Eaton Vance Senior Income Trust SC TO-I, filed Jun 29, 2021
Eaton Vance Senior Income Trust (EVF)
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 29, 2021
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE TO
Tender Offer Statement Under Section 14(d)(1) or 13(e)(1) of the
Securities Exchange Act Of 1934
Eaton Vance Senior Income Trust
(Name of Subject Company (Issuer))
Eaton Vance Senior Income Trust
(Name of Filing Person (Issuer))
Common Shares of Beneficial Interest, $.01 par value
(Title of Class of Securities)
27826S103
(CUSIP Number of Class of Securities)
Deidre E. Walsh
Eaton Vance Management
Two International Place
Boston, Massachusetts 02110
(617) 672-8579
(Name, Address and Telephone Number of Person Authorized to Receive Notices
and Communications on Behalf of the Person(s) Filing Statement)
| Calculation of Filing Fee | |
| Transaction Valuation | Amount Of Filing Fee |
| $155,027,409.10(a) | $16,913.49 (b) |
| (a) | Estimated for purposes of calculating the amount of the filing fee only. Pursuant to Rule 0-11(b)(1) under the Securities Exchange Act of 1934, as amended, the Transactional Value was calculated by multiplying 22,719,965 shares in the offer (60% of the total number of common shares outstanding) by $6.8234 (99% of the net asset value per share of $6.8923 as of the close of regular trading on the New York Stock Exchange on June 23, 2021). |
| (b) | Calculated at $109.10 per $1,000,000 of the Transaction Valuation. |
| [_] | Check the box if any part of the fee is offset as provided by Rule 0-11(a)(2) and identify the filing with which the offsetting fee was previously paid. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. |
| Amount Previously Paid: Not Applicable | Filing Party: Not Applicable |
| Form of Registration No.: Not Applicable | Date Filed: Not Applicable |
| [_] | Check the box if the filing relates solely to preliminary communications made before the commencement of a tender offer. |
Check the appropriate boxes below to designate any transactions to which the statement relates:
| [_] | third party tender offer subject to Rule 14d-1. |
| [x] | issuer tender offer subject to Rule 13e-4. |
| [_] | going-private transaction subject to Rule 13e-3. |
| [_] | amendment to Schedule 13D under Rule 13d-2. |
Check the following box if the filing is a final amendment reporting the results of the tender offer. [_]
Items 1 through 9 and Item 11.
This Tender Offer Statement on Schedule TO is filed by Eaton Vance Senior Income Trust, a Massachusetts business trust (the “Fund”). This Schedule TO relates to the Fund’s offer to purchase for cash up to 60% or 22,719,965 shares of its outstanding common shares, 0.01 par value (the “Common Shares”), upon the terms and subject to the conditions set forth in the Fund’s Offer to Purchase dated June 29, 2021 (the “Offer to Purchase”) and the related Letter of Transmittal (the “Letter of Transmittal” which, together with the Offer to Purchase constitute the “Offer”), copies of which are attached hereto as Exhibits (a)(1)(i) and (a)(1)(ii), respectively. The price to be paid for the Common Shares is an amount per share, net to the seller in cash, equal to 99% of the net asset value per share as of the Expiration Date (as defined in the Offer) or such later date to which the Offer is extended. The information set forth in the Offer is incorporated herein by reference with respect to Items 1 through 9 and Item 11 of this Schedule TO.
Item 10.
Not applicable.
Item 12. Exhibits.
| Exhibit No. | Document |
| (a)(1)(i) | Offer to Purchase dated June 29, 2021 |
| (a)(1)(ii) | Letter of Transmittal |
| (a)(1)(iii) | Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees |
| (a)(1)(iv) | Letter to Clients for us by Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees |
| (a)(1)(v) | Form of Notice of Withdrawal |
| (a)(5)(i) | Press Release issued on June 29, 2021 |
| (b)(i) | Form of Amended and Restated Revolving Credit and Security Agreement between Eaton Vance Senior Income Trust, Conduit Lenders and Citibank, N.A. |
| (d)(i) | Standstill Agreement dated May 12, 2021 |
Item 13.
Not applicable.
Signature
After due inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.
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Eaton Vance Senior Income Trust
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| By: | /s/ Eric A. Stein |
| Name: | Eric A. Stein |
| Title: | President |
Dated as of June 29, 2021
Exhibit (a)(1)(i)
OFFER TO PURCHASE
EATON VANCE SENIOR INCOME TRUST
OFFER TO PURCHASE FOR CASH UP TO
60% OR 22,719,965 OF ITS OUTSTANDING
COMMON SHARES OF BENEFICIAL INTEREST AT 99%
OF NET ASSET VALUE PER SHARE
THE FUND’S OFFER AND WITHDRAWAL RIGHTS
WILL EXPIRE AT 5:00 P.M., EASTERN TIME
ON JULY 30, 2021, UNLESS THE OFFER IS EXTENDED
On May 12, 2021, the Board of Trustees (the “Board”) of Eaton Vance Senior Income Trust, a Massachusetts business trust registered under the Investment Company Act of 1940, as amended, as a closed-end management investment company (the “Fund”), approved a tender offer for up to 60% of the outstanding common shares of beneficial interest of the Fund (the “Shares”), upon the terms and subject to the conditions set forth in the enclosed Offer to Purchase and the related Letter of Transmittal (which together constitute the “Offer”). If more than 60% of the Fund’s Shares are tendered and not withdrawn, any purchases will be made on a pro rata basis (disregarding fractional shares). The Offer is for cash at a price per Share equal to 99% of the net asset value (“NAV”) of the Shares as of the close of ordinary trading on the New York Stock Exchange (the “NYSE”) on the date the Offer expires. The Offer period and withdrawal rights will expire at 5:00 p.m. Eastern Time on July 30, 2021, unless extended, upon the terms and subject to the conditions of the Offer. The Offer is designed to provide shareholders of the Fund with the opportunity to redeem some or all of their Shares at a price close to NAV should they wish to do so.
None of the Fund, the Board nor Eaton Vance Management, the investment adviser for the Fund (“EVM”), makes any recommendation as to whether or not you should tender any or all of your Shares in the Offer. No person has been authorized to give any information or to make any representations in connection with the Offer other than those contained in this Offer to Purchase and in the related Letter of Transmittal, and if given or made, such information or representations may not be relied upon as having been authorized by the Board or the officers of the Fund or EVM.
You may direct questions and requests for assistance to AST Fund Solutions, LLC, the information agent (“Information Agent”) for the Offer, at its address and telephone number set forth on the back cover of this Offer to Purchase. Any holders of Shares (“Shareholders”) may obtain additional copies of this Offer to Purchase, the Letter of Transmittal, the Notice of Withdrawal or any other tender materials from the Information Agent and may also contact their brokers, dealers, banks, trust companies or other nominees for copies of these documents. If you do not wish to tender your Shares, you need not take any action.
If, after carefully evaluating all of the information set forth in this Offer to Purchase, you wish to tender Shares pursuant to the Offer, please follow the instructions contained herein and in the Letter of Transmittal or, if your Shares are held of record in the name of a broker, dealer, commercial bank, trust company or other nominee, contact that firm to effect the tender for you. Shareholders are urged to consult their own investment and tax advisors and make their own decisions whether to tender any Shares and, if so, how many Shares to tender.
THIS OFFER TO PURCHASE AND THE FUND’S RELATED LETTER OF TRANSMITTAL CONTAIN IMPORTANT INFORMATION, AND YOU SHOULD CAREFULLY READ BOTH IN THEIR ENTIRETY BEFORE YOU MAKE A DECISION WITH RESPECT TO THE OFFER.
June 29, 2021
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Table of Contents
| SUMMARY TERM SHEET | 3 | |
| INTRODUCTION | 8 | |
| THE OFFER | 11 | |
| 1. | TERMS OF THE OFFER; EXPIRATION DATE | 11 |
| 2. | EXTENSION OF TENDER PERIOD, TERMINATION; AMENDMENT | 12 |
| 3. | PROCEDURES FOR TENDERING COMMON SHARES | 12 |
| 4. | WITHDRAWAL RIGHTS | 14 |
| 5. | ACCEPTANCE FOR PAYMENT AND PAYMENT | 15 |
| 6. | CERTAIN MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES | 16 |
| 7. | PRINCE RANGE OF COMMON SHARES; DIVIDENDS | 19 |
| 8. | SOURCE AND AMOUNT OF FUNDS; EFFECT OF THE OFFER | 19 |
| 9. | PURPOSE OF THE OFFER | 21 |
| 10. | INFORMATION CONCERNING THE FUND | 22 |
| 11. | INTERESTS OF THE TRUSTEES AND OFFICERS; TRANSACTIONS AND ARRANGEMENTS CONCERNING THE SHARES | 23 |
| 12. | LEGAL MATTER; REGULATORY APPROVALS | 24 |
| 13. | CONDITIONS OF THE OFFER | 24 |
| 14. | FEES AND EXPENSES | 25 |
| 15. | MISCELLANEOUS | 25 |
| 16. | CONTACTING THE DEPOSITARY AND THE INFORMATION AGENT | 26 |
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OFFER TO PURCHASE
EATON VANCE SENIOR INCOME TRUST
OFFER TO PURCHASE FOR CASH UP TO 60% OR 22,719,965
OUTSTANDING COMMON SHARES OF BENEFICIAL INTEREST
SUMMARY TERM SHEET
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This Summary Term Sheet highlights certain information in this Offer to Purchase. To understand the Offer (as defined herein) fully and for a more complete description of the terms of the Offer, please read carefully this entire Offer to Purchase and the related Letter of Transmittal (which together constitute the “Offer”). We have included section references to direct you to a more complete description in this Offer to Purchase of the topics in this Summary.
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What and how many securities is Eaton Vance Senior Income Trust (the “Fund”) offering to purchase?
The Board of Trustees of the Fund (the “Board” or the “Trustees”) has authorized the Fund to conduct a cash tender offer to purchase up to 60% or 22,719,965 (the “Offer Amount”) of its issued and outstanding common shares of beneficial interest the “Shares”) at the purchase price discussed below. If the number of Shares properly tendered and not withdrawn prior to the date and time the Offer expires is less than or equal to the Offer Amount, the Fund will, upon the terms and subject to the conditions of the Offer, purchase all Shares tendered. If more Shares than the Offer Amount are properly tendered and not withdrawn prior to the date the Offer expires, the Fund will purchase the Offer Amount on a pro rata basis (disregarding fractional shares). Shareholders cannot be assured that all of their tendered Shares will be repurchased. For more information see Section 1, “Terms of the Offer; Expiration Date.”
Are there conditions to the Offer?
The Offer is subject to certain customary conditions described in Section 13 of this Offer to Purchase.
How much and in what form will the Fund pay me for my Shares?
The Fund will pay cash for Shares purchased pursuant to the Offer. The purchase price will equal 99% of the Fund’s net asset value (“NAV”) per Share as of the close of regular trading on the New York Stock Exchange (the “NYSE”) on the date the Offer expires, July 30, 2021 (or if the Offer is extended, on the date to which the Offer is extended), upon the terms and subject to the conditions set forth in Offer.
The Shares are traded on the NYSE under the ticker symbol “EVF.” As of June 23, 2021, the closing price as of the close of regular trading of the NYSE was $6.78 per Share. The Fund normally calculates the NAV of its Shares daily at the close of regular trading of the NYSE. As of the close of regular trading of the NYSE on June 23, 2021, the NAV was $6.8923 per Share. During the pendency of the Offer, current NAV quotations can be obtained from AST Fund Solutions, LLC, the information agent for the Offer (“Information Agent”) at 1-877-732-3614. For more information see Section 1, “Terms of the Offer; Expiration Date” and Section 5, “Acceptance for Payment and Payment.”
When does the Offer expire? Can the Fund extend the Offer, and if so, when will the Fund announce the extension?
| • | The Offer expires on July 30, 2021 at 5:00 p.m., Eastern Time, unless the Fund extends the Offer. The later of July 30, 2021 and the latest time or date to which the Offer is extended is hereinafter called the “Expiration Date.” |
| • | The Fund may extend the Offer period at any time. If it does, the Fund would adjust the purchase price as needed to correspond with such extension. |
| • |
If the Offer period is extended, the Fund will make a public announcement of the extension no later than 9:30 a.m. Eastern Time on the next business day following the previously scheduled Expiration Date.
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If you hold your Shares directly, you have until the Expiration Date to decide whether to tender your Shares in the Offer. If you want to tender your Shares, but you cannot comply with the procedure for book-entry transfer by the Expiration Date, you will not be able to tender your Shares. This can occur, for example, if you purchased Shares at, or within one or two days of, the Expiration Date, not allowing sufficient time for such purchase transaction to settle. There are no guaranteed delivery procedures available under the terms of the Offer as an alternative delivery mechanism. You should consult your broker or other Nominee Holder, as defined below, to determine if there is an earlier deadline by which you must inform such Nominee Holder of any decision to tender your Shares and provide to such Nominee Holder any other required materials. For more information see Section 1, “Terms of the Offer; Expiration Date” and Section 2, “Extension of Tender Period; Termination; Amendment.”
Will I have to pay any fees or commissions on Shares I tender?
No fees or commissions will be payable to the Fund in connection with the Offer. However, brokers, dealers, or other persons may charge Shareholders a fee for soliciting tenders for Shares by the Fund pursuant to the Offer. Shareholders may be obligated to pay transfer taxes on the purchase of Shares by the Fund and other transaction costs. For more information see Section 1, “Terms of the Offer; Expiration Date,” Section 5, “Acceptance for Payment and Payment” and Section 14, “Fees and Expenses.”
Does the Fund have the financial resources to pay me for my Shares?
Yes. If the Fund purchased 60% or 22,719,965 Shares at 99% of the June 23, 2021 NAV of $ 6.8234 per Share, the Fund’s total cost, not including fees and expenses incurred in connection with the Offer (which will be paid by EVM), would be approximately $155,027,409.10. The Fund expects to borrow money to finance a portion of the purchase of tendered Shares under a credit agreement (the “Credit Agreement”) that it currently has in place with State Street Bank and Trust Company. Other sources of funds for the purchase of tendered shares include cash on hand and the liquidation of portfolio instruments. For more information see Section 8, “Source and Amount of Funds; Effect of the Offer.”
How do I tender my Shares?
If your Shares are registered in the name of a nominee holder, such as a broker, dealer, commercial bank, trust company or other nominee (“Nominee Holder”), you should contact that firm if you wish to tender your Shares.
All other Shareholders wishing to participate in the Offer must, prior to the Expiration Date, complete and execute a Letter of Transmittal, together with any required signature guarantees, and any other documents required by the Letter of Transmittal. You must send these materials to American Stock Transfer & Trust Company, LLC (the “Depositary”) at its address set forth on page 10 of this Offer to Purchase. You must comply with the book-entry delivery procedure set forth in Section 3.C of this Offer to Purchase. The Depositary must receive these materials prior to the date and time the Offer expires. For more information see Section 3, “Procedures for Tendering Common Shares.”
Until what time can I withdraw tendered Shares?
You may withdraw your tendered Shares at any time prior to the Expiration Date. In addition, after the Offer expires, you may withdraw your tendered Shares if the Fund has not yet accepted tendered Shares for payment by August 25, 2021, the date that is 40 business days from commencement of the Offer.
Withdrawals of tendered Shares may not be rescinded, and any Shares validly withdrawn will thereafter be deemed not validly tendered for purposes of the Offer. However, withdrawn Shares may be retendered by following one of the procedures described in Section 3 of this Offer to Purchase at any time before the Expiration Date. For more information see Section 4, “Withdrawal Rights.”
How do I withdraw tendered Shares?
If you desire to withdraw tendered Shares, you should either:
| • | Give proper written notice to the Depositary; or |
| • | If your Shares are held of record in the name of a Nominee Holder, contact that firm to withdraw your tendered Shares. |
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For more information see Section 4, “Withdrawal Rights.”
What are the tax consequences of tendering Common Shares?
The receipt of cash for Shares pursuant to the Offer by a U.S. shareholder other than a Shareholder exempt from tax or investing through a tax-advantaged arrangement generally will be a taxable transaction for U.S. federal income tax purposes and may also be a taxable transaction under applicable state, local, foreign and other tax laws. For U.S. federal income tax purposes, the sale of your Shares for cash generally will be treated either as (1) a sale or exchange of the Shares, or (2) a distribution with respect to the Shares that is treated in whole or in part as a taxable dividend. Each Shareholder should consult its tax adviser as to the tax consequences of tendering its Shares in the Offer. For more information see Section 6, “Certain Material U.S. Federal Income Tax Consequences.”
What is the purpose of the Offer?
On March 1, 2021, Eaton Vance Corp., the parent company of the Fund’s investment adviser, Eaton Vance Management (“EVM”), was acquired by Morgan Stanley, a leading global financial services firm that provides a wide range of investment banking, securities, wealth management and investment management services (the “Transaction”). In connection with the Transaction, Fund shareholders were asked to approve a new investment advisory agreement with EVM (the “New Agreement”) in order to maintain the continuity of the Fund’s operations. As announced on May 12, 2021, the Board approved the Offer, conditioned on Fund shareholders approving the New Agreement. Shareholders approved the New Agreement at a special meeting of shareholders held on June 24, 2021 and the condition was met.
The Offer will provide Shareholders with partial liquidity at close to NAV and has the potential to reduce, at least temporarily, the discount from NAV at which the Shares currently trade. There can be no assurance, however, that this Offer will have the effect of narrowing the discount or that any reduction in the discount will be sustained following the expiration of the Offer. The market price of the Shares will also be determined by, among other things, the relative demand for and supply of the Shares in the market, the Fund’s investment performance, the Fund’s dividends and yield, and investor perception of the Fund’s overall attractiveness as an investment as compared with other investment alternatives.
Saba Capital Management, L.P. (“Saba”) and certain of its affiliates are holders of the Fund’s Shares. In late 2020 and 2021, representatives of EVM and Saba were involved in discussions relating to shareholder approval of the New Agreement. As a result of those discussions, EVM and Saba entered into an agreement (the “Agreement”) pursuant to which EVM recommended to the Board, and the Board authorized, the Offer and the three conditional tender offers discussed below, and Saba agreed to, among other things, (i) vote in favor of the Fund’s New Agreement and (ii) constraints in connection with initiating certain activist activities during the term of the Agreement. As discussed above, the New Agreement was approved by shareholders at a special meeting held on June 24, 2021.
In addition to the Offer, EVM also recommended to the Board, and the Board authorized, three conditional cash tender offers to follow the Offer (“Subsequent Conditional Tender Offers”). Specifically, the Board authorized the Fund to conduct a conditional tender offer in the fourth quarter of each of 2022, 2023 and 2024 for up to 10% of the Fund’s then-outstanding common shares at 98% of NAV if, from January to August of that year, the Fund’s shares trade at an average discount to its NAV of more than 10% (based upon the Fund’s volume-weighted average market price and NAV on business days during the period).
This Offer to Purchase and the Letter of Transmittal relate solely to the Offer and do not relate to the Subsequent Conditional Tender Offers.
EVM recommended, and the Board approved the Offer upon the terms specified in this Offer to Purchase and the Letter of Transmittal. Among other things, the Board considered that EVM would bear the costs of this Offer and that this Offer: (i) will provide Shareholders with partial liquidity at close to NAV; (ii) may result in a temporary reduction in the Fund’s trading discount; (iii) because the Offer would be conducted at a 1% discount to NAV, the Offer would result in immediate accretion to the NAV of the Shares of remaining Shareholders; and (iv) would facilitate an agreement with Saba to support approval of the New Agreement, which the Board believes is in the best interests of the Fund. The Board also considered that the Offer may also have certain negative consequences for the Fund, including: (i) a decrease in net assets and an associated increase in the Fund’s per share total expense ratio; (ii) brokerage and other transaction expenses associated with selling portfolio instruments to purchase Shares
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pursuant to the Offer; (iii) potential tax consequences to the Fund and the Shareholders; and (iv) the likelihood that any reduction in the Fund’s trading discount resulting from the Offer will be temporary. The Board also considered that the Offer was conditioned on shareholder approval of the New Agreement.
Please bear in mind that none of the Fund, its Board, nor EVM has made any recommendation as to whether or not you should tender your Shares. Shareholders are urged to consult their own investment and tax advisors and make their own decisions whether to tender any Shares and, if so, how many Shares to tender. For more information see Section 9, “Purpose of the Offer.”
What are the most significant conditions of the Offer?
The Fund may not accept Shares tendered for payment under any one of the following circumstances that, in the view of the Board, would make it inadvisable to proceed with the Offer, purchase or payment. The following is not a complete list. For a complete list of the conditions of the Offer, please see Section 13, “Conditions of the Offer.”
| • | The purchase of Shares in the Offer would result in the delisting of the Shares from the NYSE. |
| • | The Offer could impair compliance with U.S. Securities and Exchange Commission or Internal Revenue Service requirements. |
| • | The purchase of Shares in the Offer would result in a failure to comply with the applicable asset coverage requirements applicable to any senior securities of the Fund that are issued and outstanding. |
| • | In the Board’s reasonable judgment, there is a material legal action or proceeding instituted or threatened, challenging the Offer or otherwise potentially materially adversely affecting the Fund. |
| • | The suspension of or limitation on prices for trading securities generally on the NYSE, other national securities exchange or NASDAQ. |
| • | Declaration of a banking moratorium by federal or state authorities or any suspension of payment by banks in the United States or New York State. |
| • | New limitation affecting the Fund or the issuers of its portfolio instruments imposed by federal or state authorities on the extension of credit by lending institutions. |
| • | The Board determines that the purchase of Shares might be a breach of its fiduciary duty. |
If I decide not to tender, how will the Offer affect my Shares?
If you do not tender your Shares (or if you own Shares following completion of the Offer), your percentage ownership interest in the Fund will increase after the completion of the Offer and you will be subject to any increased risks associated with the reduction in the Fund’s total assets due to the payment for the tendered Shares. These risks may include greater volatility due to a decreased asset base and proportionately higher expenses, as well as the possibility of receiving additional taxable capital gains on the distributions from the sale of portfolio instruments to pay for tendered Shares. The reduced assets of the Fund as a result of the Offer may result in less investment flexibility for the Fund, depending on the number of Shares repurchased and may have an adverse effect on the Fund’s investment performance. For more information see Section 8, “Source and Amount of Funds; Effect of the Offer” and Section 14, “Fees and Expenses.”
Whom do I contact if I have questions about the Offer?
If you own Shares through a broker or other Nominee Holder, you can call your broker or other Nominee Holder. You can also contact AST Fund Solutions, LLC, the Information Agent, at 1-877-732-3614.
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EATON VANCE SENIOR INCOME TRUST
OFFER TO PURCHASE FOR CASH UP TO 60% OR 22,719,965
OF ITS OUTSTANDING COMMON SHARES OF
BENEFICIAL INTEREST AT 99%
OF NET ASSET VALUE PER SHARE
THE FUND’S OFFER AND WITHDRAWAL RIGHTS
WILL EXPIRE AT 5:00 P.M., EASTERN TIME
ON JULY 30, 2021, UNLESS THE OFFER IS EXTENDED
To the holders of Shares of Eaton Vance Senior Income Trust:
INTRODUCTION
The Fund is a Massachusetts business trust registered under the Investment Company Act of 1940, as amended, (“1940 Act”) as a closed-end management investment company. The Fund, upon the terms and conditions set forth herein, is offering to purchase up to 60% or 22,719,965 (the “Offer Amount”) of its outstanding common shares of beneficial interest, with par value of $.01 per share (the “Shares”) for cash at a price equal to 99% of the NAV per Share as of the close of regular trading of the NYSE on the Expiration Date (as defined below). As of the close of regular trading of the NYSE on June 23, 2021, the Fund’s NAV was $6.8923 per Share. During the pendency of the Offer, current NAV quotations can be obtained from AST Fund Solutions, LLC, the information agent for the Offer (“Information Agent”) at 1-877-732-3614. For information on Share price history, see Section 7, “Price Range of Shares; Dividends.”
The Offer period and withdrawal rights will expire at 5:00 p.m. Eastern Time on July 30, 2021, unless extended, upon the terms and subject to the conditions set forth in this Offer to Purchase and the related Letter of Transmittal (which together, constitute the “Offer”). The later of July 30, 2021 or the latest time and date to which the Offer is extended is hereinafter called the “Expiration Date.” Shareholders who choose to participate in the Offer can expect payments for Shares tendered and accepted to be mailed within approximately ten business days after the Expiration Date.
This Offer is open to all Shareholders and none of the Fund, its Board, or Eaton Vance Management (“EVM”), the investment adviser for the Fund, makes any recommendation to any Shareholder as to whether to tender any or all of such Shareholder’s Shares. Shareholders are urged to evaluate carefully all information in the Offer, consult their own investment and tax advisors, and make their own decisions whether to tender Shares and, if so, how many Shares to tender.
No person has been authorized to make any recommendation on behalf of the Fund as to whether Shareholders should tender their Shares pursuant to the Offer. No person has been authorized to give any information or to make any representations in connection with the Offer other than those contained herein or in the Letter of Transmittal. If given or made, such recommendation and such information and representations must not be relied upon as having been authorized by the Fund or EVM. The Fund has been advised that the Fund’s Trustees, officers or its investment adviser do not intend to tender any Shares pursuant to the Offer.
The Offer is not conditioned upon the tender of any minimum number of Shares. If the number of Shares properly tendered and not withdrawn prior to the Expiration Date is less than or equal to the Offer Amount, the Fund will, upon the terms and subject to the conditions of the Offer, purchase all Shares tendered. If more Shares than the Offer Amount are properly tendered and not withdrawn prior to the Expiration Date, the Fund will, upon the terms and subject to the conditions of the Offer, purchase the Offer Amount on a pro rata basis (disregarding fractional shares). See Section 1, “Terms of the Offer; Expiration Date.”
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If, after carefully evaluating all of the information set forth in the Offer, you wish to tender Shares pursuant to the Offer, please either follow the instructions contained in this Offer to Purchase and Letter of Transmittal or, if your Shares are held of record in the name of a Nominee Holder, contact such firm to effect the tender for you.
THIS OFFER TO PURCHASE AND THE LETTER OF TRANSMITTAL CONTAIN IMPORTANT INFORMATION AND YOU SHOULD READ THEM CAREFULLY AND IN THEIR ENTIRETY BEFORE YOU MAKE ANY DECISION WITH RESPECT TO THE OFFER.
If you do not wish to tender your Shares, you need not take any action.
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THIS OFFER IS BEING MADE TO ALL SHAREHOLDERS
OF THE FUND AND IS NOT CONDITIONED UPON ANY
MINIMUM NUMBER OF SHARES BEING TENDERED.
THIS OFFER IS SUBJECT TO CERTAIN CONDITIONS.
SEE SECTION 13, “CONDITIONS OF THE OFFER.”
IMPORTANT
None of the Fund, its Board, nor EVM makes any recommendation to any Shareholder as to whether to tender any or all of such Shareholder’s Shares. Shareholders are urged to evaluate carefully all information in the offer, consult their own investment and tax advisors, and make their own decisions whether to tender Shares and, if so, how many Shares to tender.
No person has been authorized to make any recommendation on behalf of the Fund as to whether Shareholders should tender Shares pursuant to the Offer. No person has been authorized to give any information or to make any representations in connection with the Offer other than those contained herein or in the Letter of Transmittal. If given or made, such recommendation and such information and representations must not be relied upon as having been authorized by the Fund. The Fund has been advised that neither the Fund’s Trustees, its officers or its investment adviser intend to tender any Shares pursuant to the Offer.
Questions and requests for assistance and requests for additional copies of this Offer to Purchase and Letter of Transmittal should be directed to the Information Agent at the telephone number set forth below.
The Information Agent for the Offer is:
AST Fund Solutions, LLC
48 Wall Street, 22nd Floor
New York, New York 10005
1-877-732-3614
The Depositary for the Offer is:
American Stock Transfer & Trust Company, LLC
|
If delivering by hand, mail, express mail, courier or any other expedited service: American Stock Transfer & Trust Company,
LLC
If delivering by facsimile transmission: 718-234-5001 |
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THE OFFER
1. TERMS OF THE OFFER; EXPIRATION DATE
Upon the terms and subject to the conditions set forth in this Offer to Purchase, the Fund will accept for payment and purchase for cash for up to 60% or 22,719,965 of its issued and outstanding Shares at a price equal to 99% of the NAV per Share as of the close of regular trading of the NYSE on the date the Offer expires, July 30, 2021, or if the Offer is extended, as of the close of regular trading of the NYSE on the date to which the Offer is extended. As of the close of regular trading of the NYSE on June 23, 2021, the Fund’s NAV was $6.8923 per Share. During the pendency of the Offer, current NAV quotations can be obtained from AST Fund Solutions, LLC, the information agent for the Offer (“Information Agent”) at 1-877-732-3614. The Fund reserves the right to extend the Offer at any time. The Offer period may be extended by the Fund issuing a press release or making some other public announcement no later than 9:30 a.m. Eastern Time on the next business day after the Offer otherwise would have expired. During any such extension, all Shares previously tendered and not withdrawn will remain subject to the Offer, subject to the right of any such tendering Shareholder to withdraw his, her or its Shares.
If the Fund makes a material change in the terms of the Offer or the information concerning the Offer, or if it waives a material condition of the Offer, the Fund will extend the Offer to the extent required under the Securities Exchange Act of 1934, as amended, (the “Exchange Act”).
The Offer is being made to all Shareholders of the Fund and is not conditioned upon any minimum number of Shares being tendered. If the number of Shares properly tendered and not withdrawn prior to the Expiration Date is less than or equal to 60% of the Fund’s outstanding Shares, the Fund will, upon the terms and subject to the conditions of the Offer, purchase all Shares so tendered. If more Shares than the Offer Amount are properly tendered and not withdrawn prior to the Expiration Date, the Fund will purchase the Offer Amount on a pro rata basis (disregarding fractional shares). Shares acquired by the Fund pursuant to the Offer will thereafter constitute authorized but unissued Shares of the Fund. Under no circumstances will interest be paid on the Offer price for tendered Shares, regardless of any extension of or amendment to the Offer or any delay in paying for such Shares.
When considering whether to tender Shares, Shareholders should be aware that the payment received pursuant to the Offer will be less than the amount that the Shareholders would be entitled to receive upon a liquidation of the Fund.
Shares will be purchased at 99% of the NAV of the Shares as of the close of regular trading of the NYSE on the date the Offer expires, July 30, 2021, or if the Offer is extended, as of the close of regular trading of the NYSE on the date the Offer is extended, which is expected to more than offset the costs of the tender, including the processing of tender forms, effecting payment, postage and handling. The Fund will not charge a separate service fee in conjunction with the Offer. If your Shares are held through a financial intermediary, the financial intermediary may charge you a service or other fee for participation in the Offer. Tendering Shareholders will not be obligated to pay transfer taxes on the purchase of Shares by the Fund, except in the circumstances set forth in Section 5, “Acceptance for Payment and Payment.”
Subject to the terms and conditions of the Offer, the Fund will pay the consideration offered or return the tendered Shares promptly after the termination or withdrawal of the Offer. Specifically, shareholders who choose to participate in the Offer can expect payments for Shares tendered and accepted to be mailed within approximately ten business days after the Expiration Date. If payment of the purchase price is to be made to, or Shares not tendered or not purchased are to be returned in, the name of any person other than the registered holder(s), or if a transfer tax is imposed for any reason other than the sale or transfer of Shares to the Fund pursuant to the Offer, then the amount of any share transfer taxes (whether imposed on the registered holder(s), such other persons or otherwise) will be deducted from the purchase price unless satisfactory evidence of the payment of such taxes, or exemption therefrom, is submitted.
As of June 23, 2021, there were 37,866,607 Shares outstanding and there were approximately 72 holders of record of these Shares. As of the date of this Offer to Purchase, the Fund has been advised that none of its Trustees, officers nor investment adviser intend to tender any Shares pursuant to the Offer.
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2. EXTENSION OF TENDER PERIOD, TERMINATION; AMENDMENT
The Fund expressly reserves the right, in its sole discretion, at any time or from time to time, to extend the period of time during which the Offer is open by giving notice of such extension to the Information Agent and making a public announcement thereof. In the event that the Fund so elects to extend the tender period, the NAV for the Shares tendered will be computed as of the close of regular trading of the NYSE on the newly designated Expiration Date. During any such extension, all Shares previously tendered and not purchased or withdrawn will remain subject to the Offer. The Fund also reserves the right, at any time and from time to time up to and including the Expiration Date, to (a) terminate the Offer and not purchase or pay for any Shares or, subject to applicable law, postpone payment for Shares, in each case upon the occurrence of any of the conditions specified in Section 13, “Conditions of the Offer”; and (b) amend the Offer in any respect by making a public announcement thereof. Such public announcement will be issued no later than 9:30 a.m. Eastern Time on the next business day after the previously scheduled Expiration Date. Without limiting the manner in which the Fund may choose to make a public announcement of extension, termination or amendment, except as provided by applicable law (including Rule 13e-4(d)(2), Rule 13e-4(e)(3), and Rule 14e-l(d) under the Exchange Act), the Fund shall have no obligation to publish, advertise or otherwise communicate any such public announcement.
If the Fund materially changes the terms of the Offer or the information concerning the Offer, or if it waives a material condition of the Offer, the Fund will extend the Offer to the extent required by Rules 13e-4(d)(2) and 13e-4(e)(3) under the Exchange Act. These rules require that the minimum period during which the Offer must remain open following material changes in the terms of the Offer or information concerning the Offer (other than a change in price or a change in percentage of securities sought) will depend on the facts and circumstances, including the relative materiality of such terms or information. If (i) the Fund increases or decreases the price to be paid for Shares, or the Fund unilaterally decreases the number of Shares being sought and (ii) the Expiration Date is less than ten business days away, then the Expiration Date will be extended at least ten business days from the date of the notice.
3. PROCEDURES FOR TENDERING COMMON SHARES
A. Proper Tender of Shares.
Shareholders that are registered in the name of a Nominee Holder should contact such firm if they desire to tender their Shares.
For Shares to be properly tendered pursuant to the Offer, the following must occur prior to 5:00 p.m. Eastern Time on the Expiration Date:
| (a) | A properly completed and duly executed Letter of Transmittal, together with any required signature guarantees, (or an Agent’s Message as described in Section 3.C, “Book Entry Delivery Procedures”), and any other documents required by the Letter of Transmittal must be received by the Depositary at its address set forth on page 10 of this Offer to Purchase; and |
| (b) | The tendering Shareholder must comply with the book-entry delivery procedure set forth in Section 3.C, “Book Entry Delivery Procedures.” |
If you want to tender your Shares, but you cannot comply with the procedure for book-entry transfer by the Expiration Date of the Offer, you will not be able to tender your Shares. This can occur, for example, if you purchased Shares at, or within one or two days of, the Expiration Date, not allowing sufficient time for such purchase transaction to settle. There are no guaranteed delivery procedures available under the terms of the Offer as an alternative delivery mechanism. If the Letter of Transmittal is signed by trustees, executors, administrators, guardians, agents, attorneys- in-fact, officers of corporations or others acting in a fiduciary or representative capacity, such persons should so indicate when signing and must submit proper evidence satisfactory to the Fund of their authority to so act. Letters of Transmittal should be sent to the Depositary; they should not be sent or delivered to the Fund.
Section 14(e) of the Exchange Act, and Rule 14e-4 promulgated thereunder make it unlawful for any person, acting alone or in concert with others, to tender shares in a partial tender offer for such person’s own account unless at the time of tender, and at the time the shares are accepted for payment, the person tendering has a net long position equal to or greater than the amount tendered in (i) shares, and will deliver or cause to be delivered such shares for the purpose of tendering to the person making the offer within the period specified in the offer, or (ii) an equivalent security and, upon acceptance of his or her tender, will acquire shares by conversion, exchange, or exercise of such equivalent security to the extent required by the terms of the Offer, and will deliver or cause to be delivered the shares so acquired for the purpose of tender to the offer or prior to or on the expiration date. Section 14(e) and Rule 14e-4 provide a similar restriction applicable to the tender or guarantee of a tender on behalf of another person.
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The acceptance of Shares by the Fund for payment will constitute a binding agreement between the tendering Shareholder and the Fund upon the terms and subject to the conditions of the Offer, including the tendering Shareholder’s representation that (i) such Shareholder has a net long position in the Shares being tendered within the meaning of Rule 14e-4 promulgated under the Exchange Act and (ii) the tender of such Shares complies with Rule 14e-4.
By submitting the Letter of Transmittal, a tendering Shareholder shall, subject to and effective upon acceptance for payment of the Shares tendered, be deemed in consideration of such acceptance to sell, assign and transfer to, or upon the order of, the Fund all right, title and interest in and to all the Shares that are being tendered (and any and all dividends, distributions, other Shares or other securities or rights declared or issuable in respect of such Shares after the Expiration Date) and irrevocably constitute and appoint the Depositary the true and lawful agent and attorney-in-fact of the tendering Shareholder with respect to such Shares (and any such dividends, distributions, other Shares or securities or rights), with full power of substitution (such power of attorney being deemed to be an irrevocable power coupled with an interest) to (a) present such Shares (and any such other dividends, distributions, other Shares or securities or rights) for transfer on the books of the Fund, and (b) receive all benefits and otherwise exercise all rights of beneficial ownership of such Shares (and any such other dividends, distributions, other Shares or securities or rights), all in accordance with the terms of the Offer. By submitting a Letter of Transmittal, and in accordance with the terms and conditions of the Offer, a tendering Shareholder shall be deemed to represent and warrant that: (a) the tendering Shareholder has full power and authority to tender, sell, assign and transfer the tendered Shares (and any and all dividends, distributions, other Shares or other securities or rights declared or issuable in respect of such Shares after the Expiration Date); (b) when and to the extent the Fund accepts the Shares for purchase, the Fund will acquire good, marketable and unencumbered title thereto, free and clear of all liens, restrictions, charges, proxies, encumbrances or other obligations relating to their sale or transfer, and not subject to any adverse claim; (c) on request, the tendering Shareholder will execute and deliver any additional documents deemed by the Depositary or the Fund to be necessary or desirable to complete the sale, assignment and transfer of the tendered Shares (and any and all dividends, distributions, other Shares or securities or rights declared or issuable in respect of such Shares after the Expiration Date); and (d) the tendering Shareholder has read and agreed to all of the terms of the Offer, including this Offer to Purchase and the Letter of Transmittal.
B. Signature Guarantees and Method of Delivery.
Signatures on the Letter of Transmittal are required to be guaranteed if a check for cash is to be issued in a name other than that of the registered owner of such Shares. In those instances, all signatures on the Letter of Transmittal must be guaranteed by an eligible guarantor acceptable to the Depositary (an “Eligible Guarantor”). An Eligible Guarantor includes a bank, broker, dealer, credit union, savings association or other entity that is a member in good standing of the Securities Transfer Agents Medallion Program, or a bank, broker, dealer, credit union, savings association or other entity that is an “Eligible Guarantor Institution” as such term is defined in Rule 17Ad-15 under the Exchange Act. If Shares are tendered for the account of an institution that qualifies as an Eligible Guarantor, signatures on the Letter of Transmittal are not required to be guaranteed. If the Letter of Transmittal is signed by a person or persons authorized to sign on behalf of the registered owner(s), then the Letter of Transmittal must be accompanied by documents evidencing such authority to sign to the satisfaction of the Fund.
THE METHOD OF DELIVERY OF ANY DOCUMENTS IS AT THE ELECTION AND RISK OF THE PARTY TENDERING SHARES. IF DOCUMENTS ARE SENT BY MAIL, IT IS RECOMMENDED THAT THEY BE SENT BY REGISTERED MAIL, PROPERLY INSURED, WITH RETURN RECEIPT REQUESTED.
C. Book-Entry Delivery Procedure.
The Depositary will establish accounts with respect to the Shares at The Depository Trust Company (“DTC”) for purposes of the Offer. Any financial institution that is a participant in any of DTC’s systems may make delivery of tendered Shares by (i) causing DTC to transfer such Shares into the Depositary’s account in accordance with DTC’s procedure for such transfer; and (ii) causing a confirmation of receipt of such delivery to be received by the Depositary. DTC may charge the account of such financial institution for tendering Shares on behalf of Shareholders. Notwithstanding that delivery of Shares may be properly effected in accordance with this book-entry delivery procedure, the Letter of Transmittal, with signature guarantee, if required, or, in lieu of the Letter of Transmittal, an Agent’s Message (as defined below), must be transmitted to and received by the Depositary at the appropriate address set forth on page 10 of this Offer to Purchase before 5:00 p.m. Eastern Time on the Expiration Date.
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The term “Agent’s Message” means a message from DTC transmitted to, and received by, the Depositary forming a part of a timely confirmation of a book-entry transfer (a “Book-Entry Confirmation”), which states that DTC has received an express acknowledgment from the DTC participant (“DTC Participant”) tendering the Shares that are the subject of the Book-Entry Confirmation that (i) the DTC Participant has received and agrees to be bound by the terms of the Letter of Transmittal; and (ii) the Fund may enforce such agreement against the DTC Participant.
DELIVERY OF DOCUMENTS TO DTC IN ACCORDANCE WITH DTC’S PROCEDURES DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY FOR PURPOSES OF THIS OFFER.
D. Determination of Validity.
All questions as to the validity, form, eligibility (including time of receipt) and acceptance of tenders will be determined by the Fund, in its sole discretion, whose determination shall be final and binding. The Fund reserves the absolute right to reject any or all tenders determined by it not to be in appropriate form or good order, or the acceptance of or payment for which may, in the opinion of the Fund’s counsel, be unlawful. The Fund also reserves the absolute right to waive any of the conditions of the Offer or any defect in any tender with respect to any particular Shares or any particular Shareholder, and the Fund’s interpretations of the terms and conditions of the Offer will be final and binding. Unless waived, any defects or irregularities in connection with tenders must be cured within such times as the Fund shall determine. Tendered Shares will not be accepted for payment unless any defects or irregularities have been cured or waived within such time. Neither the Fund, EVM, the Depositary nor any other person shall be obligated to give notice of any defects or irregularities in tenders, nor shall any of them incur any liability for failure to give such notice.
E. Federal Income Tax Withholding.
Payments made to tendering Shareholders pursuant to the Offer may be subject to withholding pursuant to the Internal Revenue Code of 1986, as amended, (the “Code”) and the regulations thereunder. For an additional discussion of such withholding as well as a discussion of certain other U.S. federal income tax consequences to tendering and non-tendering Shareholders, see Section 6, “Certain Material U.S. Federal Income Tax Consequences.”
4. WITHDRAWAL RIGHTS
Except as otherwise provided in this Section 4, tenders of Shares made pursuant to the Offer will be irrevocable. You have the right to withdraw tendered Shares at any time prior to 5:00 p.m. Eastern Time on the Expiration Date. If you desire to withdraw Shares tendered on your behalf by a Nominee Holder, you may withdraw by contacting that firm and instructing them to withdraw such Shares. In addition, after the Offer expires, you may withdraw your tendered Shares if the Fund has not yet accepted tendered Shares for payment by August 25, 2021, the date that is 40 business days from commencement of the Offer. To be effective, a written or facsimile transmission notice of withdrawal must be timely received by the Depositary at the address set forth on page 10 of this Offer to Purchase. Any notice of withdrawal must specify the name of the person who tendered the Shares to be withdrawn, the number of Shares to be withdrawn, and the names in which the Shares to be withdrawn are registered. Shareholders should contact the Information Agent for instructions if they wish to submit a notice of withdrawal.
Any notice of withdrawal must specify the name and number of the account at the book-entry transfer facility to be credited with the withdrawn Shares (which must be the same name, number, and book-entry transfer facility from which the Shares were tendered), and must comply with the procedures of DTC.
All questions as to the form and validity (including time of receipt) of notices of withdrawal will be determined by the Fund in its sole discretion, whose determination shall be final and binding.
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Neither the Fund, EVM, the Depositary nor any other person shall be obligated to give notice of any defects or irregularities in tenders, nor shall any of them incur any liability for failure to give such notice. Shares properly withdrawn shall not thereafter be deemed to be tendered for purposes of the Offer. However, withdrawn Shares may be retendered by following the procedures described in Section 3, “Procedures for Tendering Common Shares,” prior to 5:00 p.m. Eastern Time on the Expiration Date.
The method of delivery of any documents related to a withdrawal is at the risk of the withdrawing Shareholder. Any documents related to a withdrawal will be deemed delivered only when actually received by the Depositary. If delivery is by mail, registered mail with return receipt requested, properly insured, is recommended. In all cases, sufficient time should be allowed to ensure timely delivery.
5. ACCEPTANCE FOR PAYMENT AND PAYMENT
Upon the terms and subject to the conditions of the Offer, the Fund will accept for payment, and will pay cash for, Shares validly tendered on or before the Expiration Date, and not properly withdrawn in accordance with Section 4, promptly after the Expiration Date of the Fund’s Offer. Specifically, shareholders who choose to participate in the Offer can expect payments for Shares tendered and accepted to be mailed within approximately ten business days after the Expiration Date. The Fund expressly reserves the right, in its sole discretion, to delay the acceptance for payment of, or payment for, Shares, in order to comply, in whole or in part, with any applicable law.
Payment for Shares accepted for payment pursuant to the Offer will be made by the Depositary out of funds made available to it by the Fund. The Depositary will act as agent for the Fund for the purpose of effecting payment to the tendering Shareholders. In all cases, payment for Shares tendered and accepted for payment pursuant to the Offer will be made only after timely receipt by the Depositary of (i) a Book-Entry Confirmation of the delivery of such Shares, (ii) a properly completed and duly executed Letter of Transmittal or, in the case of a book-entry transfer, an Agent’s Message in lieu of the Letter of Transmittal, and (iii) any other documents required by the Letter of Transmittal. Accordingly, payment may not be made to all tendering Shareholders at the same time and will depend upon when Book-Entry Confirmations of tendered Shares are received in the Depositary’s account at DTC.
If any tendered Shares are not accepted for payment or are not paid because of an invalid tender or if a Shareholder withdraws tendered Shares, (i) the Shares will be issued in book-entry form and will be electronically held in your account for such unpurchased Shares, as soon as practicable following the expiration, termination or withdrawal of the Offer, (ii) Shares delivered pursuant to the book-entry delivery procedures will be credited to the account from which they were delivered, and (iii) Shares held by the Fund’s transfer agent pursuant to the Fund’s dividend reinvestment and cash purchase plan will be returned to the dividend reinvestment and cash purchase plan account maintained by the transfer agent.
The Fund will pay all transfer taxes, if any, payable on the transfer to it of Shares purchased pursuant to the Offer. If, however, payment of the purchase price is to be made to, or if unpurchased Shares were registered in the name of, any person other than the tendering holder, the amount of any transfer taxes (whether imposed on the registered holder or such other person) payable on account of such transfer will be deducted from the purchase price unless satisfactory evidence of the payment of such taxes, or exemption therefrom, is submitted. In addition, if certain events occur, the Fund may not be obligated to purchase Shares pursuant to the Offer. See Section 13, “Conditions of the Offer.”
A tendering U.S. Shareholder or other payee who fails to fully complete and sign an IRS Form W-9 (or substitute form) may be subject to U.S. federal income backup withholding on the gross proceeds paid to such Shareholder or other payee pursuant to the Offer. Non-U.S. Shareholders (as defined in Section 6, “Certain Material U.S. Federal Income Tax Consequences” below) should provide the Depositary with an appropriate completed IRS Form W-8BEN or Form W-8BEN-E (or substitute form) in order to avoid backup withholding. A copy of IRS Form W-9, W-8BEN or W-8BEN-E will be provided upon request from the Depositary. See Section 3, “Procedures for Tendering Common Shares” and Section 6, “Certain Material U.S. Federal Income Tax Consequences.”
6. CERTAIN MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES
The following discussion is a general summary of the U.S. federal income tax consequences of the purchase of Shares by the Fund from Shareholders pursuant to the Offer. This summary is based on U.S. federal income tax law as of the date the Offer begins, including the Code, applicable Treasury regulations, Internal Revenue Service (“IRS”) rulings, judicial authority and current administrative rulings and practice, all of which are subject to change, possibly with retroactive effect. There can be no assurance that the IRS would not assert, or that a court would not
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sustain, a position contrary to any of those set forth below, and the Fund has not obtained, nor does the Fund intend to obtain, a ruling from the IRS or an opinion of counsel with respect to any of the consequences described below. Shareholders should also consult their own tax advisors regarding their particular situation and the potential tax consequences to them of a purchase of their Shares by the Fund pursuant to the Offer, including potential state, local and foreign taxation, as well as any applicable transfer taxes.
As used herein, the term “U.S. Shareholder” refers to a Shareholder who is (i) a citizen or resident of the United States, (ii) a corporation (other entity taxable as a corporation) created or organized in or under the laws of the United States or any State thereof or the District of Columbia, (iii) an estate the income of which is subject to U.S. federal income tax regardless of the source of such income, or (iv) a trust if (x) a court within the United States is able to exercise primary supervision over the administration of the trust and one or more U.S. persons (as defined in the Code) have the authority to control all substantial decisions of the trust or (y) the trust has a valid election in effect under applicable U.S. Treasury regulations to be treated as a U.S. person. If an entity or arrangement treated as a partnership for U.S. federal income tax purposes holds our Shares, the tax treatment of an owner of such an entity or arrangement will depend on the status of the owner, the activities of the entity or arrangement and certain determinations made at the owner level. The term “Non-U.S. Shareholder” refers to a Shareholder who is not a U.S. Shareholder.
Sale or Exchange of Shares. A Shareholder whose Shares are repurchased pursuant to the Offer generally will be treated as having sold the Shares and (other than tax-exempt Shareholders) will recognize gain or loss for U.S. federal income tax purposes, so long as either (a) such Shareholder tenders, and the Fund repurchases, all of such Shareholder’s Shares (i.e., the Shareholder reduces its percentage ownership of the Fund to 0%) or meets certain numerical safe harbors with respect to percentage voting interest and reduction in ownership of the Fund following the completion of the Offer, or (b) the tender otherwise is treated as being “not essentially equivalent to a dividend” under current U.S. federal income tax law. For these purposes, a Shareholder’s ownership of the Fund is determined after applying the ownership attribution rules under Section 318 of the Code. Under Section 318 of the Code, a Shareholder may constructively own Shares actually owned, and in some cases constructively owned, by certain related individuals and certain entities in which the Shareholder or a related individual or entity has an interest. The rules of constructive ownership are complex and must be applied to a particular Shareholder’s situation. Such gain or loss will equal the difference between the price paid by the Fund for the Shares pursuant to the Offer and the Shareholder’s adjusted tax basis in the Shares sold. A Shareholder’s holding period for Shares repurchased pursuant to the Offer will terminate as of the Expiration Date. A tendering Shareholder’s gain or loss will generally be capital gain or loss if the Shares sold are held by the Shareholder at the time of sale as capital assets and will be treated as long-term capital gain if the Shares have been held for more than one year or as short-term if the Shares have been held for one year or less. It is expected that, if a Shareholder is treated as having sold Shares pursuant to the Offer and realizes a gain upon such sale, and if one or more payments are received after the close of the taxable year of the Shareholder in which the Expiration Date occurs, unless the Shareholder elects otherwise, the gain will be accounted for under the installment sale rules for U.S. federal income tax purposes and the Shareholder will generally recognize any such gain as and when proceeds are received, likely allocating tax basis according to the presumed percentage of the total payment received in each installment. To the extent that a portion of any such gain is treated as interest, that portion will be taxed to the Shareholder as ordinary income.
The maximum U.S. federal income tax rate applicable to short-term capital gains recognized by a non-corporate Shareholder is currently the same as the applicable ordinary income rate. In addition, the Code generally imposes a 3.8% Medicare contribution tax on the net investment income of certain individuals, estates and trusts to the extent their income exceeds certain threshold amounts. For these purposes, “net investment income” generally includes, among other things, (i) distributions paid by the Fund of net investment income and capital gains, and (ii) any net gain from the sale, exchange or other taxable disposition of Shares of the Fund.
In the event that a tendering Shareholder’s ownership of the Fund is not reduced to the extent required under the tests described above, such Shareholder will be deemed to receive a distribution from the Fund under Section 301 of the Code with respect to the Shares held (or deemed held under Section 318 of the Code) by the Shareholder after the tender (a “Section 301 distribution”). Such distribution, which will equal the price paid by the Fund to such Shareholder for the Shares sold, will be taxable as a dividend to the extent of the Fund’s current and accumulated earnings and profits allocable to such distribution. Any such dividend will constitute an ordinary income dividend, an exempt-interest dividend or a capital gain dividend. An ordinary income dividend is generally taxable at ordinary income tax rates, and a dividend properly reported as a capital gain dividend is generally taxable at long-term capital gain rates. The excess will be treated as a return of capital reducing the Shareholder’s tax basis in the Shares held after the Offer (but not below zero), and thereafter as capital gain. In the case of a tendering Shareholder that is a corporation treated as receiving a Section 301 distribution from the Fund in connection with the transaction, special basis adjustments might also apply with respect to any Shares of such Shareholder not repurchased in connection with the Offer.
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Provided that no tendering Shareholder is treated as receiving a Section 301 distribution as a result of the Offer, Shareholders whose percentage ownership of the Fund increases as a result of the Offer will not be treated as realizing constructive distributions by virtue of that increase. In the event that any tendering Shareholder is deemed to receive a Section 301 distribution as a result of the Offer, it is possible that Shareholders whose percentage ownership of the Fund increases as a result of the Offer, including Shareholders who do not tender any Shares pursuant to the Offer, will be deemed to receive a constructive distribution under Section 305(c) of the Code in an amount determined by the increase in their percentage ownership of the Fund as a result of the Offer. Such constructive distribution will be treated as a dividend to the extent of current or accumulated earnings and profits allocable to it, and treated as provided in the immediately preceding paragraph. Such dividend treatment will not apply, however, if the tender is treated as an “isolated redemption” within the meaning of the Treasury regulations.
Under the “wash sale” rules under the Code, provided the tender of Shares pursuant to the Offer is treated as a sale or exchange (and not a distribution as described above), loss recognized on Shares sold pursuant to the Offer will ordinarily be disallowed to the extent the Shareholder acquires other Shares of the Fund (whether through automatic reinvestment of dividends or otherwise) or substantially identical stock or securities within 30 days before or after the date the tendered Shares are purchased pursuant to the Offer and, in that event, the basis and holding period of the Shares acquired will be adjusted to reflect the disallowed loss. Any loss realized by a Shareholder on the sale of a Share held by the Shareholder for six months or less will be treated for U.S. federal income tax purposes as a long-term capital loss to the extent of any distributions or deemed distributions of long-term capital gains received by the Shareholder with respect to such Share. A Shareholder’s ability to use capital losses may be limited under the Code.
Non-U.S. Shareholders. Provided the sale of Shares pursuant to the Offer is respected as a sale or exchange for U.S. federal income tax purposes, any gain realized by a Non-U.S. Shareholder upon the tender of Shares pursuant to the Offer will generally not be subject to any U.S. tax withholding and, provided such gain is not effectively connected with a trade or business carried on in the U.S. by such Non-U.S. Shareholder, will not be subject to any U.S. federal income tax. If, instead, all or a portion of the proceeds received by a tendering Non-U.S. Shareholder is treated for U.S. federal income tax purposes as a Section 301 distribution by the Fund that is treated in whole or in part as a dividend, or if a Non-U.S. Shareholder is otherwise treated as receiving a deemed distribution that is a dividend by reason of the Shareholder’s increase in its percentage ownership of the Fund resulting from other Shareholders’ sale of Shares pursuant to the Offer, absent a statutory exemption, the dividend received or deemed received by the Non-U.S. Shareholder would be subject to a U.S. withholding tax at the rate of 30% (or such lower rate as may be applicable under a tax treaty). If any gain or dividend income realized in connection with the tender of Shares by a Non-U.S. Shareholder is effectively connected with a trade or business carried on in the U.S. by the Non-U.S. Shareholder, such gain or dividend will be taxed at the graduated rates applicable to U.S. Shareholders. If a Non-U.S. Shareholder is eligible for the benefits of a tax treaty, any gain or dividend income that is effectively connected with a U.S. trade or business will generally be subject to U.S. federal income tax on a graduated basis only if it is also attributable to a permanent establishment maintained by such Non-U.S. Shareholder in the United States. In addition, if the Non-U.S. Shareholder is a non-U.S. corporation, it may be subject to a 30% (or such lower rate as may be applicable under a tax treaty) branch profits tax on such effectively connected income.
As the Fund may be unable to determine whether a payment made pursuant to the Offer will properly be characterized as an “exchange” or a “dividend” for U.S. tax purposes at the time of such payment, the Fund may withhold up to 30% of payments made to a Non-U.S. Shareholder or its agents. In that case, such Non-U.S. Shareholder may be eligible to file for a refund of such tax or a portion of such tax if all or a portion of the tender of Shares pursuant to the Offer is treated as a sale or exchange for U.S. federal income tax purposes or if such Non- U.S. Shareholder is entitled to a reduced rate of withholding pursuant to a tax treaty and the Fund withheld at a higher rate.
In order to qualify for any exemptions from withholding described above or for lower withholding tax rates under income tax treaties, or to establish an exemption from backup withholding, a Non-U.S. Shareholder must comply with special certification and filing requirements relating to its non-U.S. status (including, in general, by furnishing an IRS Form W-8BEN, W-8BEN-E or substitute form). Non-U.S. Shareholders are urged to consult their tax advisors regarding the application of U.S. federal income tax rules, including withholding, to their tender of Shares.
Backup Withholding. The Fund generally is required to withhold and remit to the U.S. Treasury a percentage of the taxable distributions and redemption proceeds paid to any individual Shareholder who fails to properly furnish the Fund with a correct taxpayer identification number, who has under-reported dividend or interest income, or who fails to certify to the Fund that he or she is not subject to such withholding.
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Shareholders should provide the Fund with a completed IRS Form W-9, W-8BEN, W-8BEN-E, as applicable, or other appropriate form in order to avoid backup withholding on the distributions they receive from the Fund regardless of how they are taxed with respect to their tendered Shares. Backup withholding is not an additional tax and any amount withheld may be credited against a Shareholder’s U.S. federal income tax liability, provided the appropriate information is furnished to the IRS.
Other Tax Consequences. The Fund’s purchase of Shares in the Offer may directly result in, or contribute to, a subsequent limitation on the Fund’s ability to use capital loss carryforwards to offset future gains. Therefore, in certain circumstances, Shareholders who remain Shareholders following completion of the Offer may pay taxes sooner, or pay more taxes, than they would have had the Offer not occurred.
Any sales of securities by the Fund to raise cash to meet repurchase requests could result in increased taxable distributions to Shareholders, including distributions taxable as ordinary income. See “Recognition of Capital Gains” below.
Under Treasury regulations directed at tax shelter activity, if a Shareholder recognizes a loss of $2 million or more in the case of an individual Shareholder or $10 million or more in the case of a corporate Shareholder (or a greater loss over a combination of years), such Shareholder must file a disclosure statement with the IRS on Form 8886. Direct holders of portfolio instruments are in many cases excepted from this reporting requirement, but under current guidance, Shareholders of a regulated investment company (“RIC”) are not excepted. Future guidance may extend the current exception from this reporting requirement to Shareholders of most or all RICs. The fact that a loss is reportable under these regulations does not affect the legal determination of whether the taxpayer’s treatment of the loss is proper. Shareholders should consult their own tax advisors concerning any possible disclosure obligation with respect to their investment in Shares.
FATCA Withholding. Sections 1471-1474 of the Code and the U.S. Treasury and IRS guidance issued thereunder (collectively, “FATCA”) generally require the Fund to obtain information sufficient to identify the status of each of its Shareholders under FATCA or under an applicable intergovernmental agreement (an “IGA”) between the United States and a foreign government. If a Shareholder fails to provide the requested information or otherwise fails to comply with FATCA or an IGA, the Fund may be required to withhold under FATCA with respect to that Shareholder at a rate of 30% on ordinary dividends it pays. The IRS and Department of Treasury have issued proposed regulations providing that these withholding rules will not be applicable to the gross proceeds of share redemptions or capital gain dividends the Fund pays. If a payment by the Fund is subject to FATCA withholding, the Fund is required to withhold without reference to any other withholding exemption.
In addition to the withholding described above under “-Non-U.S. Shareholders,” as the Fund may be unable to determine whether a payment made pursuant to the Offer will properly be characterized as an “exchange” or a “dividend” for U.S. tax purposes at the time of such payment, the Fund may withhold under FATCA up to 30% of any payment to a tendering Shareholder that is a foreign financial institution (“FFI”) or non-financial foreign entity (“NFFE”) unless (a) in the case of an FFI, the FFI reports certain direct and indirect ownership of foreign financial accounts held by U.S. persons with the FFI and (b) in the case of an NFFE, the NFFE (i) reports information relating to its “substantial U.S. owners” (within the meaning of FATCA), if any, or (ii) certifies that it has no “substantial U.S. owners.”
Certain Non-U.S. Shareholders may fall into certain exempt, excepted or deemed-compliant categories as established by U.S. Treasury regulations, IGAs, and other guidance regarding FATCA. In order to qualify for any such exception, a Non-U.S. Shareholder generally must provide the Fund with the applicable IRS Form W-8 (W-8BEN-E, W-8ECI, W-8EXP or W-8IMY) properly certifying the Shareholder’s status under FATCA.
Shareholders are urged to consult their own tax advisors regarding the application of U.S. federal income tax withholding, including eligibility for a withholding tax reduction or exemption, and the applicable refund procedure, if any.
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7. PRICE RANGE OF COMMON SHARES; DIVIDENDS
The Shares are traded on the NYSE. During each completed quarter indicated below, the highest and lowest market price per Share, and period-end market price per Share (as of the close of regular trading of the NYSE on the last day of such periods) were as follows:
| Quarter Ended | |||
| Market Price ($) | |||
| High | Low | Close | |
| March 31, 2019 | $6.31 | $5.92 | $6.15 |
| June 30, 2019 | $6.39 | $6.08 | $6.23 |
| September 30, 2019 | $6.32 | $6.03 | $6.12 |
| December 31, 2019 | $6.41 | $6.09 | $6.41 |
| March 31, 2020 | $6.58 | $3.84 | $4.61 |
| June 30, 2020 | $5.57 | $4.48 | $5.33 |
| September 30, 2020 | $6.01 | $5.29 | $5.87 |
| December 31, 2020 | $6.43 | $5.80 | $6.36 |
| March 31, 2021 | $6.70 | $6.33 | $6.63 |
The Fund commenced operations on October 30, 1998 as an NYSE-listed company. The Fund intends to declare and pay a dividend to common shareholders at least monthly and a distribution to preferred shareholders, if any, approximately monthly or weekly, as applicable. Any capital gains are distributed at least annually.
8. SOURCE AND AMOUNT OF FUNDS; EFFECT OF THE OFFER
The actual cost to the Fund of purchasing Shares from the Offer cannot be determined at this time because the number of Shares to be purchased will depend on the number tendered, and the price will be 99% of the NAV of the Shares on the Expiration Date. If the NAV on that date were the same as the NAV per share on June 23, 2021, and if 60% of the outstanding Shares are purchased pursuant to the Offer, the estimated cost to the Fund, not including fees and expenses incurred in connection with the Offer, would be approximately $155,027,409.10. Of course, the NAV can change every business day. You can obtain current NAV quotations from AST Fund Solutions, LLC, the Information Agent at 1-877-732-3614.
The monies to be used by the Fund to purchase Shares pursuant to the Offer will be obtained from any cash on hand, borrowings under its credit facility and/or from proceeds of sales of instruments in the Fund’s investment portfolio. The Fund expects to borrow money to finance a portion of the purchase of tendered Shares. See “Effect on NAV and Consideration Received by Tendering Shareholders.” below for more information.
The Offer may have certain adverse consequences for tendering and non-tendering Shareholders.
Effect on NAV and Consideration Received by Tendering Shareholders. To pay the aggregate purchase price of Shares accepted for payment pursuant to the Offer, the Fund anticipates that funds will be derived from cash on hand, borrowings under its credit facility and/or from proceeds of sales of instruments in the Fund’s investment portfolio. The Fund expects to borrow money to finance a portion of the purchase of tendered Shares. The Fund is a party to an Amended and Restated Revolving Credit and Security Agreement, as amended (the “Credit Agreement”) with conduit lenders and Citibank, N.A. (together, “Citi”) to borrow up to $125 million. Borrowings under the Credit Agreement are secured by the assets of the Fund. Interest is charged at a spread above the conduits’ commercial paper issuance rate and is payable monthly. Under the terms of the Credit Agreement, the Fund also pays a program fee of 0.85% per annum on its outstanding borrowings to administer the facility and a liquidity fee of 0.15% (0.25% if the outstanding loan amount is less than or equal to 60% of the total facility size) per annum on the unused portion of the total commitment under the Credit Agreement. In connection with the renewal of the Agreement on March 8, 2021, the Fund paid upfront fees of $187,000. Following the close of the tender period and no later than 3 days after the payment date for tendered Shares, the total commitment under the Credit Agreement will be reduced by an amount proportionate to the percentage of total Fund shares tendered.
If the Fund is required to sell a substantial amount of portfolio instruments to raise cash to finance the Offer, the over-supply of portfolio instruments for sale could cause market prices of the Fund’s portfolio instruments, and hence the NAV of the Shares, to decline. If such a decline occurs, the Fund cannot predict what its magnitude might be or whether such a decline would be temporary or continue to or beyond the Expiration Date. Because the price per Share to be paid in the Offer will be dependent upon the NAV as determined as of the close of regular trading of
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the NYSE on the Expiration Date, if such a decline continued to the Expiration Date, the consideration received by tendering Shareholders would be less than it otherwise might be. In addition, a sale of portfolio instruments will cause increased transaction expenses, and the Fund may receive proceeds from the sale of portfolio instruments that are less than the valuations of such securities by the Fund. Accordingly, because of the Offer, the NAV per Share may decline more than it otherwise might, thereby reducing the amount of proceeds received by tendering Shareholders, and also reducing the NAV for non-tendering Shareholders. However, because the Offer price is for 99% of the NAV of the Shares, the purchase of Shares tendered in and of itself would be somewhat accretive to the NAV of Shares outstanding following completion of the Offer.
The Fund may sell portfolio instruments during the pendency of the Offer to raise cash for the purchase of Shares. Thus, it is likely that during the pendency of the Offer, and possibly for a short time thereafter, the Fund will hold a greater than normal percentage of its net assets in cash and cash equivalents. This larger cash position may interfere with the Fund’s ability to meet its investment objective and invest consistent with its investment strategy. The Fund is required by law to pay for tendered Shares it accepts for payment promptly after the Expiration Date of this Offer. Specifically, shareholders who choose to participate in the Offer can expect payments for Shares tendered and accepted to be mailed within approximately ten business days after the Expiration Date. If on or prior to the Expiration Date, the Fund does not have, or believes it is unlikely to have, sufficient cash to pay for all Shares tendered, it may extend the Offer to allow additional time to sell portfolio instruments and raise sufficient cash.
Recognition of Capital Gains. As noted above, the Fund may be required to sell portfolio instruments in order to raise cash to meet purchase requests pursuant to the Offer. The actual tax effect of such sales will depend on the difference between the price at which such portfolio instruments are sold and the tax basis of the Fund in such securities. Any capital gains recognized in any such sales on a net basis, after reduction by any available capital losses, including capital loss carryforwards, will be distributed to Shareholders as capital gain dividends (to the extent of net realized long-term capital gains over net realized short-term capital losses) or ordinary dividends (to the extent of net realized short-term capital gains over net realized long-term capital losses) during or with respect to the year of sale, and such distributions will be taxable to Shareholders. Any such sales (1) could require Shareholders that hold Shares at the time of a declaration of distributions to pay taxes on greater distributions of capital gains recognized by the Fund than they otherwise would have absent such sales; and (2) could require the Fund to sell additional portfolio instruments in order to raise cash to make such additional distributions, thereby, requiring the Fund, in turn, to realize and recognize additional capital gains.
It is impossible to predict the amount of unrealized gains or losses in the Fund’s portfolio instruments at the time that the Fund is required to sell such portfolio instruments, and hence the amount of capital gains or losses that would be realized and recognized. As of June 23, 2021, the Fund had net unrealized gains of $3,868,565.54, net realized losses for the current fiscal year to date of $(5,782,396.98), and capital loss carryforwards of $(14,226,660) from its most recent tax year-end of June 30, 2020.
Tax Consequences of Repurchases to Shareholders. The Fund’s purchase of Shares tendered pursuant to the Offer will have tax consequences for tendering Shareholders and may also have tax consequences for non-tendering Shareholders. See Section 6, “Certain Material U.S. Federal Income Tax Consequences.”
Effect on Remaining Shareholders, Higher Expense Ratio and Less Investment Flexibility. The purchase of Shares by the Fund pursuant to the Offer will have the effect of increasing the proportionate interest in the Fund of non-tendering Shareholders. All Shareholders remaining after the Offer will be subject to any increased risks associated with the reduction in the Fund’s aggregate assets resulting from payment for the tendered Shares, such as greater volatility due to decreased diversification, potentially greater exposure to leverage, and proportionately higher expenses. The reduced net assets of the Fund as a result of the Offer may result in less investment flexibility for the Fund, depending on the number of Shares repurchased, and may have an adverse effect on the Fund’s investment performance.
Possible Proration. If greater than 60% of the Fund’s Shares are tendered pursuant to the Offer, the Fund would, upon the terms and subject to the conditions of the Offer, purchase Shares tendered on a pro rata basis (disregarding fractional shares). Accordingly, Shareholders cannot be assured that all of their tendered Shares will be repurchased.
THE OFFER MAY HAVE CERTAIN ADVERSE CONSEQUENCES FOR TENDERING AND NON-TENDERING SHAREHOLDERS.
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9. PURPOSE OF THE OFFER
On March 1, 2021, Eaton Vance Corp., the parent company of the Fund’s investment adviser, Eaton Vance Management (“EVM”), was acquired by Morgan Stanley, a leading global financial services firm that provides a wide range of investment banking, securities, wealth management and investment management services (the “Transaction”). In connection with the Transaction, Fund shareholders were asked to approve a new investment advisory agreement with EVM (the “New Agreement”) in order to maintain the continuity of the Fund’s operations. As announced on May 12, 2021, the Board approved the Offer, conditioned on Fund shareholders approving the New Agreement. Shareholders approved the New Agreement at a special meeting of shareholders held on June 24, 2021 and the condition was met.
The Board has authorized the Offer because, among other things, it will provide Shareholders with partial liquidity at close to NAV and has the potential to reduce, at least temporarily, the discount from NAV at which the Shares currently trade. There can be no assurance, however, that this Offer will have the effect of narrowing the discount or that any reduction in the discount will be sustained following the expiration of the Offer. The market price of the Shares will also be determined by, among other things, the relative demand for and supply of the Shares in the market, the Fund’s investment performance, the Fund’s dividends and yield, and investor perception of the Fund’s overall attractiveness as an investment as compared with other investment alternatives.
Saba Capital Management, L.P. (“Saba”) and certain of its affiliates are holders of the Fund’s Shares. In late 2020 and 2021, representatives of EVM and Saba were involved in discussions relating to shareholder approval of the New Agreement. As a result of those discussions, EVM and Saba entered into an agreement (the “Agreement”) pursuant to which EVM recommended to the Board, and the Board authorized, the Offer and the three conditional tender offers discussed below, and Saba agreed to, among other things, (i) vote in favor of the Fund’s New Agreement and (ii) constraints in connection with initiating certain activist activities during the term of the Agreement. As discussed above, the New Agreement was approved by shareholders at a special meeting held on June 24, 2021.
In addition to the Offer, EVM also recommended to the Board, and the Board authorized, three conditional cash tender offers to follow the Offer (“Subsequent Conditional Tender Offers”). Specifically, the Board authorized the Fund to conduct a conditional tender offer in the fourth quarter of each of 2022, 2023 and 2024 for up to 10% of the Fund’s then-outstanding common shares at 98% of NAV if, from January to August of that year, the Fund’s shares trade at an average discount to its NAV of more than 10% (based upon the Fund’s volume-weighted average market price and NAV on business days during the period).
This Offer to Purchase and the Letter of Transmittal relate solely to the Offer and do not relate to the Subsequent Conditional Tender Offers.
EVM recommended, and the Board approved the Offer upon the terms specified in this Offer to Purchase and the Letter of Transmittal. Among other things, the Board considered that EVM would bear the costs of this Offer and that this Offer: (i) will provide Shareholders with partial liquidity at close to NAV; (ii) may result in a temporary reduction in the Fund’s trading discount; (iii) because the Offer would be conducted at a 1% discount to NAV, the Offer would result in immediate accretion to the NAV of the Shares of remaining Shareholders; and (iv) would facilitate an agreement with Saba to support approval of the New Agreement, which the Board believes is in the best interests of the Fund. The Board also considered that the Offer may also have certain negative consequences for the Fund, including: (i) a decrease in net assets and an associated increase in the Fund’s per share total expense ratio; (ii) brokerage and other transaction expenses associated with selling portfolio instruments to purchase Shares pursuant to the Offer; (iii) potential tax consequences to the Fund and the Shareholders; and (iv) the likelihood that any reduction in the Fund’s trading discount resulting from the Offer will be temporary. The Board also considered that the Offer was conditioned on shareholder approval of the New Agreement.
None of the Fund, its Board, or EVM makes any recommendation to any Shareholder as to whether to tender any or all of such Shareholder’s Shares. Shareholders are urged to evaluate carefully all information in the Offer, consult their own investment and tax advisors, and make their own decisions whether to tender Shares and, if so, how many Shares to tender.
10. INFORMATION CONCERNING THE FUND
The Fund is a closed-end management investment company organized as a Massachusetts business trust, whose principal executive offices are located at Two International Place, Boston, MA, 02110, telephone: (800) 262-1122. The Shares were first issued to the public on October 30, 1998.
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Available Information about the Fund. The Fund is subject to the informational requirements of the 1940 Act, and in accordance therewith files annual reports, proxy statement and other information with the Securities and Exchange Commission (“SEC”) relating to its business, financial condition and other matters. As a closed-end investment company, the Fund differs from an open-end investment company (i.e., a mutual fund) in that it does not redeem its Shares at the election of a Shareholder and does not continuously offer its Shares for sale to the public. The Fund is listed on the NYSE. The Fund’s investment objective is to provide a high level of current income, consistent with the preservation of capital. The Fund seeks to achieve its investment objective by investing primarily in senior, secured floating-rate loans. The Fund may sell portfolio instruments during the pendency of the Offer to raise cash for the purchase of Shares. Thus, it is likely that during the pendency of the Offer, and possibly for a short time thereafter, the Fund will hold a greater than normal percentage of its net assets in cash and cash equivalents. This larger cash position may interfere with the Fund’s ability to meet its investment objective and invest consistent with its investment strategy.
The Fund is required to disclose in proxy statements certain information, as of particular dates, concerning the Fund’s Trustees and officers, their remuneration, the principal holders of the Fund’s securities and any material interest of such persons in transactions with the Fund. The Fund has also filed an Issuer Tender Offer Statement on Schedule TO with the SEC. Such reports and other information are available on the SEC’s web site (http://www.sec.gov).
Agreements Involving the Fund. EVM acts as the investment adviser for the Fund pursuant to an investment advisory agreement.
The Fund also is a party to certain other service agreements. The Fund has an administrative services agreement with EVM that provides that EVM shall provide the Fund with administrative personnel and services. American Stock Transfer & Trust Company, LLC is the Fund’s transfer agent, registrar and dividend disbursing agent. American Stock Transfer & Trust Company, LLC also serves as the Fund’s Depositary for the Offer. AST Fund Solutions, LLC serves as the Fund’s Information Agent for the Offer. State Street Bank and Trust Company serves as the custodian for the Fund. The amounts paid by the Fund under these service agreements are or will be disclosed in the Fund’s financial statements, which can be found in the Fund’s annual and semi-annual reports.
11. INTERESTS OF THE TRUSTEES AND OFFICERS; TRANSACTIONS AND ARRANGEMENTS CONCERNING THE SHARES
The business address of the Trustees and officers of the Fund is Two International Place, Boston, MA, 02110. As of the date of this Offer to Purchase, the Trustees, officers and associates (as such term is used in Rule 12b-2 under the Exchange Act) do not beneficially own any Shares of the Fund, with the exception of Keith Quinton who owned approximately 7,700 common shares (0.02033%) of the Fund and John Redding who owned approximately 27,700 common shares (0.0731%) of the Fund. To the best of the Fund’s knowledge, none of the Fund’s trustees, officers, or associates currently intends to tender Shares pursuant to the Offer.
The members of the Board of the Fund are: Thomas E. Faust Jr., Mark R. Fetting, Cynthia E. Frost, George J. Gorman, Valerie A. Mosley, William H. Park, Helen Frame Peters, Keith Quinton, Marcus L. Smith, Susan J. Sutherland and Scott E. Wennerholm. Thomas E. Faust Jr. is considered an “interested person” of the Fund, as that term is defined in the Investment Company Act of 1940, as amended, by reason of his positions with EVM and its affiliates.
The principal executive officer of the Fund is Eric A. Stein. The principal financial officer of the Fund is James F. Kirchner. Correspondence to the Trustees and executive officers of the Fund should be mailed to c/o Eaton Vance Senior Income Trust, Two International Place, Boston, MA, 02110 Attn: Kimberly M. Roessiger, Secretary.
Based on the Fund’s records and upon information provided to the Fund by its Trustees and officers, and associates (as such term is used in Rule 12b-2 under the Exchange Act) neither the Fund nor, to the best of the Fund’s knowledge, any of the Trustees or officers of the Fund, nor any associates (as such term is used in Rule 12b-2 under the Exchange Act) of the Fund, has effected any transactions in the Shares during the sixty day period prior to the date hereof.
Except as set forth below and otherwise in this Offer to Purchase, to the best of the Fund’s knowledge, the Fund knows of no agreement, arrangement or understanding, contingent or otherwise or whether or not legally enforceable, between (a) the Fund, any of the Fund’s officers or Trustees, any person controlling the Fund or any officer, trustee or director of any corporation or other person ultimately in control of the Fund and (b) any person
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with respect to any securities of the Fund (including, but not limited to, any agreement, arrangement or understanding concerning the transfer or the voting of any such securities, joint ventures, loan or option arrangements, puts or calls, guarantees of loans, guarantees against loss, or the giving or withholding of proxies, consents or authorizations). On May 12, 2021, EVM entered into the Agreement with Saba. Pursuant to the Agreement, EVM recommended to the Board, and the Board approved, the Offer and Subsequent Conditional Tender Offers, and Saba agreed to the following, among other things, with respect to the Fund:
| (a) | Saba will vote or cause to be voted all Shares it and its affiliates beneficially owned as of the relevant record date in favor of the New Agreement; |
| (b) | Saba will tender, or cause to be tendered, all but one of the Shares of which Saba or its affiliates is the beneficial owner of in the Offer and in any Subsequent Conditional Tender Offers, subject to limited exceptions; |
| (c) | Saba will not, directly or indirectly, solicit proxies or make any shareholder proposal or nomination for the term of the Agreement; and |
| (d) | Saba will, upon written request of the Fund, notify the Fund in writing of the number of Shares beneficially owned by Saba and its affiliates. |
EVM also agreed to reimburse Saba for $75,000 in proxy solicitation costs for Saba’s proxy contest relating to shareholder approval of the New Agreement.
A copy of the Agreement with Saba is included as an exhibit to the Fund’s Schedule TO for this Offer.
12. LEGAL MATTERS; REGULATORY APPROVALS
Except as described in this Offer to Purchase, the Fund is not aware of any license or regulatory permit that appears to be material to its business that might be adversely affected by the acquisition of Shares as contemplated by the Offer or of any approval or other action by any government or governmental, administrative or regulatory authority or agency, domestic or foreign, that would be required for the acquisition or ownership of Shares as contemplated by the Offer. Should any such approval or other action be required, the Fund currently contemplates that it will seek approval or such other action. The Fund cannot predict whether it may determine that it is required to delay the acceptance for payment of, or payment for, Shares tendered in response to the Offer pending the outcome of any such matters. There can be no assurance that any approval or other action, if needed, would be obtained or would be obtained without substantial conditions or that the failure to obtain any approval or other action might not result in adverse consequences to the Fund’s business. The Fund’s obligation to accept for payment and pay for Shares under the Offer is subject to various conditions described in Section 13, “Conditions of the Offer.”
13. CONDITIONS OF THE OFFER
Notwithstanding any other provision of the Offer, which may be changed by the Board, and it is a condition to the Offer that the Fund cannot accept tenders or effect repurchases during any period if: (1) such transactions, if consummated, would (a) result in delisting of the Fund’s Shares from the NYSE (the NYSE Listed Company Manual provides that the NYSE would promptly initiate suspension and delisting procedures with respect to closed-end funds if the total market value of publicly held shares and net assets are each less than $5,000,000 for more than 60 consecutive days or it ceases to qualify as a closed-end fund under the 1940 Act (unless the resultant entity otherwise qualifies for listing)); (b) cause the Fund to fail to qualify and to be treated as a regulated investment company under the Internal Revenue Code of 1986 (which would subject the Fund to tax on its taxable income at corporate rates, and cause all distributions from earnings and profits, including any distributions of net tax-exempt income and net long-term capital gains, to be taxable to stockholders as ordinary income); or (c) result in a failure to comply with the applicable asset coverage requirements applicable to any senior securities of the Fund that are issued and outstanding; (2) there is (a) in the Board’s reasonable judgment, any material legal action or proceeding instituted or threatened challenging such transactions or otherwise materially adversely affecting the Fund; (b) any suspension of or limitation on prices for trading securities generally on the NYSE American, the NYSE or other national securities exchange(s), or the NASDAQ National Market System; (c) any declaration of a banking moratorium by federal or state authorities or any suspension of payment by banks in the United States or New York State or (d) a new limitation affecting the Fund or the issuers of its portfolio instruments imposed by federal or state authorities on the extension of credit by lending institutions; or (3) the Board determines in good faith, upon written advice of counsel, that effecting any such transaction would constitute a breach of their fiduciary duty owed to the Fund or its Shareholders.
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The Fund reserves the right, at any time during the pendency of the Offer, to terminate, extend or amend the Offer in any respect. In the event any of the foregoing conditions are modified or waived in whole or in part at any time, the Fund will promptly make a public announcement of such waiver and may, depending on the materiality of the modification or waiver, extend the Offer period as provided in Section 2, “Extension of Tender Period; Termination; Amendment” of this Offer to Purchase.
The foregoing conditions are for the sole benefit of the Fund and may be asserted by the Fund regardless of the circumstances (including any action or inaction by the Fund) giving rise to any of these conditions, and may be waived by the Fund, in whole or in part, at any time and from time to time, on or before the Expiration Date, in its sole discretion. The Fund’s failure at any time to exercise any of the foregoing rights shall not be deemed a waiver of any of these rights, and each of these rights shall be deemed an ongoing right that may be asserted at any time and from time to time. Any determination or judgment by the Fund concerning the events described above will be final and binding on all parties.
14. FEES AND EXPENSES
The Fund has retained AST Fund Solutions, LLC to act as the Information Agent and American Stock Transfer & Trust Company, LLC to act as the Depositary in connection with the Offer. The Information Agent may contact Shareholders by mail, telephone, or email, and may request brokers and other Nominee Holders to forward materials relating to the Offer to beneficial owners. The Information Agent and the Depositary each will receive reasonable and customary compensation for their respective services, will be reimbursed for certain reasonable out-of-pocket expenses and will be indemnified against certain liabilities in connection therewith, including certain liabilities under the federal securities laws. EVM is bearing the fees and expenses of the Offer.
EVM will not pay any fees or commissions to any broker, any other Nominee Holder, or any other person (other than the Information Agent and the Depositary) for soliciting tenders of Shares pursuant to the Offer. Brokers and other Nominee Holders will, upon request, be reimbursed by EVM for reasonable and necessary costs and expenses incurred by them in forwarding materials to their customers. No such broker or other Nominee Holder has been authorized to act as the agent of the Fund, the Information Agent, or the Depositary for purposes of the Offer.
15. MISCELLANEOUS
The Offer is not being made to (nor will tenders be accepted from or on behalf of) Shareholders in any jurisdiction in which the making of the Offer or the acceptance thereof would not be in compliance with the laws of such jurisdiction. The Fund is not aware of any jurisdiction in which the making of the Offer or the tender of the Shares is not in compliance with applicable law. However, the Fund reserves the right to exclude holders in any jurisdiction in which it is asserted that the Offer is not in compliance with any applicable law. So long as the Fund makes a good faith effort to comply with any state law deemed applicable to the Offer, the Fund believes that the exclusions of holders residing in that jurisdiction is permitted under Rule 13e-4(f)(9) under the Exchange Act.
In accordance with Rule 13e-4 under the Exchange Act, the Fund has filed with the SEC a Tender Offer Statement on Schedule TO that contains additional information with respect to the Offer. The Schedule TO, including the exhibits and any amendments thereto, are available on the SEC’s web site (http://www.sec.gov).
The Fund has not authorized any person to make any recommendation on its behalf regarding whether Shareholders should tender or refrain from tendering Shares in the Offer. The Fund has not authorized any person to provide any information or make any representation in connection with the Offer, other than those contained in this Offer to Purchase or in the related Letter of Transmittal. Shareholders should not rely upon any recommendation, information or representation that is given or made as having been authorized by the Fund, the Board, the officers of the Fund, its adviser, the Fund’s transfer agent, the Depositary or the Information Agent.
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16. CONTACTING THE DEPOSITARY AND THE INFORMATION AGENT
The Letter of Transmittal and any other required documents should be sent by each Shareholder of the Fund or his or her broker, dealer, bank, trust company or other nominees to the Depositary as set forth below.
The Depositary for the Offer is:
American Stock Transfer & Trust Company, LLC
By hand, mail, express mail, courier or any other expedited service:
American Stock Transfer & Trust Company, LLC
Operations Center
Attn: Reorganization Department
6201 15th Avenue
Brooklyn, New York 11219
*By Facsimile Transmission (for eligible institutions only):
718-234-5001
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Any questions or requests for assistance or additional copies of the Offer to Purchase, the Letter of Transmittal, and other documents may be directed to the Information Agent at its telephone number below. Shareholders may also contact their broker, dealer, commercial bank or trust company or other nominee for assistance concerning the Offer.
The Information Agent for the Offer is:
AST Fund Solutions, LLC
48 Wall Street, 22nd Floor
New York, New York 10005
1-877-732-3614
Eaton Vance Senior Income Trust
June 29, 2021
EXHIBIT (a)(1)(ii)
LETTER OF TRANSMITTAL
For Tender of Common Shares of Beneficial Interest
EATON VANCE SENIOR INCOME TRUST
Pursuant to the Offer to Purchase, dated June 29, 2021
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THE FUND’S OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., EASTERN TIME ON JULY 30, 2021, UNLESS THE OFFER IS EXTENDED. |
Please complete this Letter of Transmittal and Return to the Depositary for the Offer:
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If delivering by hand, express mail, courier, or other expedited service:
American Stock Transfer & Trust Co., LLC Operations Center Attn: Reorganization Department 6201 15th Avenue Brooklyn, New York 11219
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By mail:
American Stock Transfer & Trust Co., LLC Operations Center Attn: Reorganization Department P.O. BOX 2042 New York, NY 10272-2042
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For assistance call (877) 248-6417 or (718) 921-8317
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE DOES NOT CONSTITUTE A VALID DELIVERY. THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.
Pursuant to the Offer to Purchase dated June 29, 2021, Eaton
Vance Senior Income Trust (the “Fund”) has offered to purchase up to 60% of its issued and outstanding common shares of
beneficial interest, the undersigned encloses herewith and tenders the following shares of the Fund:
Delivery of this Letter of Transmittal to an address other than one of those set forth above will not constitute a valid delivery. YOU MUST DELIVER THIS LETTER OF TRANSMITTAL AND ANY OTHER REQUIRED DOCUMENTS TO AMERICAN STOCK TRANSFER & TRUST COMPANY, LLC, THE DEPOSITARY FOR THE OFFER (THE “DEPOSITARY”). Deliveries to the Fund, the Depository Trust Company (“DTC”) or AST Fund Solutions, LLC, the information agent for the Offer (the “Information Agent”), will not be forwarded to the Depositary and therefore will not constitute valid delivery to the Depositary.
You have received this Letter of Transmittal in connection with the Fund’s Offer to Purchase up to 60% of its issued and outstanding common shares of beneficial interest, at a price per share equal to 99% of the net asset value of the shares as of the close of ordinary trading on the New York Stock Exchange on the date the Offer expires.
You should use this Letter of Transmittal to deliver to the Depositary shares held in book-entry form on the books of the Fund for tender. Shares registered in the name of a broker, dealer, commercial bank, trust company or other nominee book-entry transfer must use an Agent’s Message (as defined in Instruction 1 below).
| ☐ | Check here if you are a financial institution that is a participant in the DTC’s system and you are delivering the tendered shares by book-entry transfer to an account maintained by the Depositary at the DTC, and complete the following: |
Name(s) of Tendering Institution(s):
Account Number: Transaction Code Number:
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
| SPECIAL PAYMENT INSTRUCTIONS (See Instructions 1 and 7) |
SPECIAL DELIVERY INSTRUCTIONS (See Instructions 1 and 7) | |||||
| Complete this box ONLY if the check for the aggregate purchase price of shares purchased (less the amount of any applicable U.S. withholding taxes) are to be issued in the name of someone other than the undersigned. | Complete this box ONLY if the check for the aggregate purchase price of shares purchased (less the amount of any applicable U.S. withholding taxes) are to be mailed to someone other than the undersigned or to the undersigned at an address other than that shown below the undersigned’s signature(s). | |||||
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| (Taxpayer Identification or Social Security Number) | (Taxpayer Identification or Social Security Number) | |||||
| (See IRS Form W-9 Included Herewith) | (See IRS Form W-9 Included Herewith) | |||||
Ladies and Gentlemen:
The undersigned hereby tenders to Eaton Vance Senior Income Trust, a Massachusetts business trust registered under the Investment Company Act of 1940, as amended, as a closed-end management investment company (the “Fund”), the above-described common shares of the Fund. All references to shares are to the Fund’s shares of common shares.
The tender of the shares is being made at a price per share equal to 99% of the Fund’s net asset value (“NAV”) per share as of the close of ordinary trading on the New York Stock Exchange on the date the offer expires, pursuant to the Fund’s Offer to Purchase up to 60% or 22,719,965 of the Fund’s issued and outstanding common shares in cash, on the terms and subject to the conditions set forth in this Letter of Transmittal and in the Fund’s Offer to Purchase, dated June 29, 2021 (which together, as they may be amended and supplemented from time to time, constitute the “Offer”), receipt of which is hereby acknowledged.
Subject to and effective upon acceptance for payment of, and payment for, shares tendered with this Letter of Transmittal in accordance with the terms and subject to the conditions of the Offer, the undersigned hereby (1) sells, assigns and transfers to or upon the order of the Fund all right, title and interest in and to all of the shares tendered hereby which are so accepted and paid for; (2) orders the registration of shares tendered by book-entry transfer that are purchased under the Offer to or upon the order of the Fund; and (3) appoints the Depositary as attorney-in-fact of the undersigned with respect to such shares, with the full knowledge that the Depositary also acts as the agent of the Fund, with full power of substitution (such power of attorney being an irrevocable power coupled with an interest), to perform the following functions:
(a) transfer ownership of such shares on the account books maintained by the DTC with all accompanying evidence of transfer and authenticity, to or upon the order of the Fund, upon receipt by the Depositary, as the undersigned’s agent, of a price per share equal to 99% of its NAV per share as of the close of ordinary trading on the New York Stock Exchange on the date the Offer expires, and with respect to such shares, and receive all benefits and otherwise exercise all rights of beneficial ownership of such shares, subject to the next paragraph, all in accordance with the terms of the Offer.
The undersigned understands that, on the terms and subject to the conditions of the Offer, the Fund will pay a purchase price per share for shares validly tendered and not properly withdrawn in the Offer, equal to 99% of its NAV per share as of the close of ordinary trading on the New York Stock Exchange on the date the Offer expires. The Fund will not purchase shares that it does not accept for purchase because of proration provisions.
The undersigned hereby covenants, represents and warrants to the Fund that:
(a) the undersigned (i) understands that it is a violation of Rule 14e-4 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) for a person, directly or indirectly, to tender shares for that person’s own account unless, at the time of tender (including any extensions thereof), the person so tendering has a “net long position” equal to or greater than the amount tendered in the Fund’s shares or in securities immediately convertible into, or exchangeable or exercisable for, the Fund’s shares, and in the Fund’s shares and will deliver or cause to be delivered the shares in accordance with the terms of the Offer; (ii) has a “net long position” in the shares, within the meaning of Rule 14e-4 under the Exchange Act, at least equal to the number of shares being tendered; and (iii) is tendering the shares in compliance with Rule 14e-4 under the Exchange Act;
(b) the undersigned has full power of authority to tender, sell, assign and transfer the shares tendered hereby;
(c) at the time and to the extent that the Fund accepts the shares for purchase, the Fund will acquire good and marketable title to such shares, free and clear of all security interests, liens, restrictions, claims, charges, encumbrances, conditional sales agreements or other obligations relating to their sale or transfer, and the shares will not be subject to any adverse claims or rights;
(d) the undersigned will, upon request, execute and deliver any additional documents deemed by the Depositary or the Fund to be necessary or desirable to complete the sale, assignment and transfer of the shares tendered hereby and accepted for purchase;
(e) the Fund has advised the undersigned to consult with the undersigned’s own advisors as to the consequences of tendering shares pursuant to the Offer; and
(f) the undersigned has read and agrees to all of the terms of the Offer.
The undersigned understands that tendering shares under any one of the procedures described in Section 3 of the Offer to Purchase and in the Instructions to this Letter of Transmittal will constitute an agreement between the undersigned and the Fund upon the terms and subject to the conditions of the Offer. The undersigned acknowledges that under no circumstances will the Fund pay interest on the purchase price.
The undersigned recognizes that under certain circumstances set forth in the Offer to Purchase, the Fund may terminate or amend the Offer, or may postpone the acceptance for payment of, or the payment for, shares tendered, or may accept for payment fewer than all the shares tendered hereby.
The names and addresses of the registered holders should be printed exactly as they appear on the account registration for the shares.
Unless otherwise indicated under “Special Payment Instructions,” please issue the check for the aggregate purchase price of any shares purchased (less the amount of any applicable U.S. withholding taxes) in the name(s) of the undersigned. Similarly, unless otherwise indicated under “Special Delivery Instructions,” please mail the check for the aggregate purchase price of any shares purchased (less the amount of any applicable U.S. withholding taxes) to the undersigned at the address shown below the undersigned’s signature(s). In the event that both the “Special Payment Instructions” and the “Special Delivery Instructions” are completed, please issue the check for the aggregate purchase price of any shares purchased (less the amount of any applicable U.S. withholding taxes) and mail said check to the person(s) so indicated.
The undersigned recognizes that the Fund has no obligation, under the Special Payment Instructions, to order the registration or transfer of shares tendered by book-entry transfer. All authority conferred or agreed to be conferred in this Letter of Transmittal shall survive the death or incapacity of the undersigned and any obligations or duties of the undersigned under this Letter of Transmittal shall be binding upon the heirs, personal representatives, successors and assigns of the undersigned. Except as stated in the Offer to Purchase, this Offer is irrevocable.
THE OFFER IS NOT BEING MADE TO (NOR WILL TENDERS BE ACCEPTED FROM OR ON BEHALF OF) SHAREHOLDERS IN ANY JURISDICTION IN WHICH THE MAKING OF THE OFFER OR THE ACCEPTANCE THEREOF WOULD NOT BE IN COMPLIANCE WITH THE LAWS OF SUCH JURISDICTION.
SHAREHOLDER(S) SIGN HERE
(See Instructions 1 and 5)
(Please Complete and Return the Attached IRS Form W-9 Below)
Must be signed by registered holder(s) exactly as name(s) appear(s) on the account registration. If a signature is by an officer on behalf of a corporation or by an executor, administrator, trustee, guardian, attorney-in-fact, agent or other person acting in a fiduciary or representative capacity, please provide full title and see Instruction 5.
| Signature(s) of Shareholder(s): | ||||
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| Taxpayer ID or Social Security No.: |
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| GUARANTEE OF SIGNATURE(S) | ||||
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| Authorized Signature: | ||||
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Telephone Number, including Area Code: |
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INSTRUCTIONS TO LETTER OF TRANSMITTAL
Forming Part of the Terms and Conditions of the Offer
1. Guarantee of Signatures. Except as otherwise provided in this Instruction, all signatures on this Letter of Transmittal must be guaranteed by a financial institution that is a participant in the Securities Transfer Agents Medallion Program or a bank, broker, dealer, credit union, savings association or other entity that is an “eligible guarantor institution,” as such term is defined in Rule 17Ad-15 under the Exchange Act (an “Eligible Institution”). Signatures on this Letter of Transmittal need not be guaranteed if either: (a) this Letter of Transmittal is signed by the registered holder(s) of the shares (which term, for purposes of this Letter of Transmittal, shall include any participant in DTC whose name appears on a security position listing as the owner of shares) tendered herewith and such holder(s) have not completed either the box entitled “Special Payment Instructions” or “Special Delivery Instructions” in this Letter of Transmittal; or (b) such shares are tendered for the account of an Eligible Institution. See Instruction 5.
2. Delivery of Letter of Transmittal. This Letter of Transmittal is to be used only by registered shareholders of book-entry shares. If shares are registered in the name of a broker, dealer, commercial bank, trust company or other nominee book-entry transfer, an Agent’s Message must be used. The term “Agent’s Message” means a message transmitted by the DTC to, and received by, the Depositary, which states that the DTC has received an express acknowledgment from the DTC participant tendering the shares that the participant has received and agrees to be bound by the terms of the Letter of Transmittal and Offer to Purchase and that the Fund may enforce this agreement against the participant.
Confirmation of a book-entry transfer in the Depositary’s account at DTC of shares tendered by book-entry transfer with a properly completed and duly executed Letter of Transmittal, and any other documents required by this Letter of Transmittal, should be mailed or delivered to the Depositary at the appropriate address set forth herein and must be received by the Depositary prior to the Expiration Date, as defined in the Offer to Purchase. The method of delivery of all documents, including the Letter of Transmittal is at the option and risk of the tendering shareholder. If you choose to deliver the documents by mail, we recommend that you use registered mail with return receipt requested, properly insured. In all cases, please allow sufficient time to assure delivery.
The Fund will not accept any alternative, conditional or contingent tenders, nor will it purchase any fractional shares. By executing this Letter of Transmittal, you waive any right to receive any notice of the acceptance for payment of your tendered shares.
3. Inadequate Space. If the space provided in the box captioned “Description of Shares Tendered” is inadequate, then you should list the number of shares tendered on a separate signed schedule attached to this Letter of Transmittal.
4. Order of Purchase. Shareholders may specify the order in which their common shares are to be purchased pursuant to the terms of the Offer. The order of purchase may have an effect on the federal income tax treatment of any gain or loss on the shares that the Fund purchases.
5. Signatures on Letter of Transmittal.
(a) Exact Signatures. If this Letter of Transmittal is signed by the registered holder(s) of the common shares tendered hereby, the signature(s) must correspond exactly with the name(s) on the account registration without any change whatsoever.
(b) Joint Holders. If the common shares tendered hereby are registered in the names of two or more persons, ALL such persons must sign this Letter of Transmittal.
(c) Different Names on Account Registrations. If any tendered shares are registered in different names on your account registrations, you must complete, sign and submit as many separate letters of transmittal as there are different account registrations.
(d) Endorsements. If this Letter of Transmittal is signed by the registered holder(s) of the shares tendered hereby, no endorsements of certificate(s) representing such shares are required unless payment is to be made to a person other than the registered holder(s).
If this Letter of Transmittal is signed by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a corporation or any other person acting in a fiduciary or representative capacity, such person should so indicate when signing and must submit to the Depositary evidence satisfactory to the Fund that such person has authority so to act.
6. Stock Transfer Taxes. Except as provided in this Instruction 6, no stock transfer tax stamps or funds to cover such stamps need to accompany this Letter of Transmittal. The Fund will pay or cause to be paid any stock transfer taxes payable on the transfer to it of shares purchased under the Offer. If, however payment of the purchase price is to be made to any person other than the registered
holder(s) then the Depositary will deduct from the purchase price the amount of any stock transfer taxes (whether imposed on the registered holder(s), such other person(s) or otherwise) payable on account of the transfer of cash or stock thereby made to such person, unless satisfactory evidence of the payment of such taxes or an exemption from them is submitted with this Letter of Transmittal.
7. Special Payment and Delivery Instructions. If any of the following conditions holds:
(a) check(s) for any shares purchased pursuant to the Offer are to be issued to a person other than the person(s) signing this Letter of Transmittal; or
(b) check(s) are to be sent to any person other than the person signing this Letter of Transmittal, or to the person signing this Letter of Transmittal, but at a different address, then, in each such case, you must complete the boxes captioned “Special Payment Instructions” and/or “Special Delivery Instructions” as applicable in this Letter of Transmittal and make sure that the signatures herein are guaranteed as described in Instructions 1 and 5.
8. Taxpayer Identification Number and Certain U.S. Withholding Taxes. Under U.S. federal income tax laws, the Depositary will be required to withhold a percentage of the amount of any payments made to certain shareholders or other payees pursuant to the Offer. In order to avoid such backup withholding, each tendering shareholder that is a U.S. person must provide the Depositary with such shareholder’s correct taxpayer identification number (“TIN”) and certify that the shareholder is not subject to backup withholding by completing the Internal Revenue Service (“IRS”) Form W-9 set forth below. In certain circumstances, a person acting on behalf of a shareholder that is a U.S. person may be required to file an IRS Form W-8IMY or other applicable IRS Form and all required attachments to establish that a payment to the shareholder is not subject to backup withholding. In order for a Non-U.S. shareholder (as defined in Section 6 of the Offer to Purchase) to establish that it is not subject to backup withholding, that shareholder must submit an IRS Form W-8BEN, IRS Form W-8BEN-E or other W-8 form, as applicable, signed under penalties of perjury, instead of the IRS Form W-9. A Form W-8BEN, Form W-8BEN-E or other W-8 form, as applicable, may be obtained from the Depositary or downloaded from the IRS’s website at the following address: http://www.irs.gov.
A shareholder is a U.S. person if the shareholder is, for U.S. federal income tax purposes, a citizen or a resident of the United States (including a U.S. resident alien), a partnership (or other entity taxable as a partnership) or corporation (or other entity taxable as a corporation) created or organized in the United States or under the laws of the United States or any state thereof or the District of Columbia, an estate whose income is subject to U.S. federal income tax regardless of its source, or a trust if (x) a U.S. court can exercise primary supervision over the trust’s administration and one or more U.S. persons are authorized to control all substantial decisions of the trust or (y) the trust has a valid election in effect under applicable U.S. Treasury regulations to be treated as a U.S. person.
If the Depositary is not provided with correct information on the IRS Form W-9, the shareholder may be subject to penalties imposed by the IRS and payments that are made to such shareholder pursuant to the Offer may be subject to backup withholding.
In order to satisfy the Depositary that a Non-U.S. shareholder is not subject to backup withholding, such shareholder must submit an applicable IRS tax form, signed under penalties of perjury, establishing that shareholder’s exempt status. Such tax forms can be obtained from the Depositary or downloaded from the IRS's website at the following address: http://www.irs.gov.
For further information concerning backup withholding and instructions for completing the IRS Form W-9 (including how to obtain a TIN if you do not have one and how to complete the IRS Form W-9 if shares are held in more than one name), consult the instructions included with the IRS Form W-9 set forth below.
Failure to complete the IRS Form W-9 or appropriate IRS Form W-8, as applicable, will not, by itself, cause shares to be deemed invalidly tendered, but may require the Depositary to withhold a percentage of the amount of any payments made pursuant to the Offer. Backup withholding is not an additional federal income tax. Rather, the federal income tax liability of a person subject to backup withholding will be reduced by the amount of tax withheld. If withholding results in an overpayment of taxes, the taxpayer may obtain a refund, provided that the required information is furnished to the IRS.
NOTE: FAILURE TO COMPLETE AND RETURN THE IRS FORM W-9 OR APPROPRIATE FORM W-8, AS APPLICABLE, MAY RESULT IN BACKUP WITHHOLDING OF A PERCENTAGE OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW THE INSTRUCTIONS INCLUDED WITH THE IRS FORM W-9 SET FORTH BELOW FOR ADDITIONAL DETAILS. YOU ARE HEREBY NOTIFIED THAT YOU SHOULD SEEK ADVICE BASED ON YOUR PARTICULAR CIRCUMSTANCES FROM AN INDEPENDENT TAX ADVISOR.
In addition, as described in Section 6 of the Offer to Purchase, if unless a reduced rate of withholding tax is applicable pursuant to an income tax treaty, or an exemption from withholding is applicable because gross proceeds paid pursuant to the Offer are effectively connected with the conduct of a trade or business within the United States (and, if an income tax treaty applies, the gross proceeds are attributable to a United States permanent establishment maintained by such Non-U.S. shareholder), proceeds payable pursuant to the Offer to a Non-U.S. shareholder or his, her or its agent may be subject to U.S. federal withholding tax at a rate of 30%. As the Fund may be unable to determine whether a payment made pursuant to the Offer will properly be characterized as an “exchange” or a “dividend” for U.S. tax purposes at the time of such payment, the Fund may withhold up to 30% of payments made to a Non-U.S. Shareholder or its agents. In that case, a Non-U.S. shareholder may be eligible to file for a refund of such tax or a portion of such tax if all or a portion of the tender of Shares pursuant to the Offer is treated as a sale or exchange for U.S. federal income tax purposes or if such shareholder is entitled to a reduced rate of withholding pursuant to a tax treaty and the Fund withheld at a higher rate.
In order to obtain a reduced rate of withholding under a tax treaty, a Non-U.S. shareholder must deliver to the Depositary or an intermediary making a payment to a Non-U.S. shareholder, before the payment, a properly completed and executed IRS tax form claiming such an exemption or reduction. Applicable tax forms can be obtained from the Depositary. In order to claim an exemption from withholding on the grounds that gross proceeds paid pursuant to the tender offer are effectively connected with the conduct of a trade or business within the United States, a foreign shareholder must deliver to the Depositary or an intermediary making a payment to a Non-U.S. shareholder, before the payment, a properly executed IRS tax form claiming such exemption. Applicable tax forms can be obtained from the Depositary.
Additionally, proceeds payable pursuant to the Offer to a Non-U.S. shareholder (other than an individual) or its agent may be subject to a 30% withholding tax under Chapter 4 of the Code, commonly referred to as “FATCA,” unless such Non-U.S. shareholder establishes an exemption from such withholding tax under FATCA, typically on IRS Form W-8BEN-E (or other applicable W-8 tax form). Applicable tax forms can be obtained from the Depositary. If a payment by the Fund is subject to FATCA withholding, the Fund is required to withhold without reference to any other withholding exemption.
Non-U.S. shareholders should consult their own tax advisors regarding the application of the U.S. federal withholding tax, including their potential eligibility for a withholding tax reduction or exemption, and the refund procedure.
9. Irregularities. The Fund will determine in its sole discretion all questions as to the purchase price, the number of shares to accept, and the validity, eligibility (including time of receipt), and acceptance for payment of any tender of shares. Any such determinations will be final and binding on all parties. The Fund reserves the absolute right to reject any or all tenders of shares it determines not to be in proper form or the acceptance of which or payment for which may, in the opinion of the Fund, be unlawful. The Fund also reserves the absolute right to waive any of the conditions of the Offer and any defect or irregularity in the tender of any particular shares, and the Fund’s interpretation of the terms of the Offer, including these instructions, will be final and binding on all parties. No tender of shares will be deemed to be properly made until all defects and irregularities have been cured or waived. Unless waived, any defects or irregularities in connection with tenders must be cured within such time as the Fund shall determine. None of the Fund, the Depositary, the Information Agent or any other person is or will be obligated to give notice of any defects or irregularities in tenders and none of them will incur any liability for failure to give any such notice.
10. Questions; Requests for Assistance and Additional Copies. Please direct any questions or requests for assistance or for additional copies of the Offer to Purchase or the Letter of Transmittal to the Information Agent at the telephone number and address set forth on the last page of this Letter of Transmittal. You may also contact your broker, dealer, commercial bank or trust company for assistance concerning the Offer.
Print or type.
See Specific Instructions on page 3.
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Form W-9 (Rev. October 2018) Department of the Treasury Internal Revenue Service |
Request for Taxpayer Identification Number and Certification
u Go to www.irs.gov/FormW9 for instructions and the latest information. |
Give Form to the requester. Do not send to the IRS. |
1 Name (as shown on your income tax return). Name is required on this line; do not leave this line blank.
2 Business name/disregarded entity name, if different from above
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3 Check appropriate box for federal tax classification
of the person whose name is entered on line 1. Check only one of the following seven
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4 Exemptions (codes apply only to certain entities, not individuals; see instructions on page 3): | |||||||||||||||||||||||
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Individual/sole proprietor or
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C Corporation
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S Corporation
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Partnership
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Trust/estate
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Exempt payee code (if any) | ||||||||||||||
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☐ Limited liability company. Enter the tax classification (C=C corporation, S=S corporation, P=Partnership) u
Note: Check the appropriate box in the line above
for the tax classification of the single-member owner. Do not check LLC if the |
Exemption from FATCA reporting code
(Applies to accounts maintained outside the U.S.)
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☐ Other (see instructions) u
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5 Address (number, street, and apt. or suite no.) See instructions.
Requester’s name and address (optional)
6 City, state, and ZIP code
7 List account number(s) here (optional)
| Part I | Taxpayer Identification Number (TIN) |
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Enter your TIN in the appropriate box. The TIN provided must match the name given on line 1 to avoid backup withholding. For individuals, this is generally your social security number (SSN). However, for a resident alien, sole proprietor, or disregarded entity, see the instructions for Part I, later. For other entities, it is your employer identification number (EIN). If you do not have a number, see How to get a TIN, later.
Note: If the account is in more than one name, see the instructions for line 1. Also see What Name and Number To Give the Requester for guidelines on whose number to enter. |
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| Employer identification number | ||||||||||||||||||||||
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| Part II | Certification |
Under penalties of perjury, I certify that:
| 1. | The number shown on this form is my correct taxpayer identification number (or I am waiting for a number to be issued to me); and |
| 2. | I am not subject to backup withholding because: (a) I am exempt from backup withholding, or (b) I have not been notified by the Internal Revenue Service (IRS) that I am subject to backup withholding as a result of a failure to report all interest or dividends, or (c) the IRS has notified me that I am no longer subject to backup withholding; and |
| 3. | I am a U.S. citizen or other U.S. person (defined below); and |
| 4. | The FATCA code(s) entered on this form (if any) indicating that I am exempt from FATCA reporting is correct. |
Certification instructions. You must cross out item 2 above if you have been notified by the IRS that you are currently subject to backup withholding because you have failed to report all interest and dividends on your tax return. For real estate transactions, item 2 does not apply. For mortgage interest paid, acquisition or abandonment of secured property, cancellation of debt, contributions to an individual retirement arrangement (IRA), and generally, payments other than interest and dividends, you are not required to sign the certification, but you must provide your correct TIN. See the instructions for Part II, later.
| Sign Here |
Signature of U.S. person u |
Date u |
General Instructions
Section references are to the Internal Revenue Code unless otherwise noted.
Future developments. For the latest information about developments related to Form W-9 and its instructions, such as legislation enacted after they were published, go to www.irs.gov/FormW9.
Purpose of Form
An individual or entity (Form W-9 requester) who is required to file an information return with the IRS must obtain your correct taxpayer identification number (TIN) which may be your social security number (SSN), individual taxpayer identification number (ITIN), adoption taxpayer identification number (ATIN), or employer identification number (EIN), to report on an information return the amount paid to you, or other amount reportable on an information return. Examples of information returns include, but are not limited to, the following.
• Form 1099-INT (interest earned or paid)
• Form 1099-DIV (dividends, including those from stocks or mutual funds)
• Form 1099-MISC (various types of income, prizes, awards, or gross proceeds)
• Form 1099-B (stock or mutual fund sales and certain other transactions by brokers)
• Form 1099-S (proceeds from real estate transactions)
• Form 1099-K (merchant card and third party network transactions)
• Form 1098 (home mortgage interest), 1098-E (student loan interest), 1098-T (tuition)
• Form 1099-C (canceled debt)
• Form 1099-A (acquisition or abandonment of secured property)
Use Form W-9 only if you are a U.S. person (including a resident alien), to provide your correct TIN.
If you do not return Form W-9 to the requester with a TIN, you might be subject to backup withholding. See What is backup withholding, later
| Cat. No. 10231X | Form W-9 (Rev. 10-2018) |
| Form W-9 (Rev. 10-2018) | Page 2 |
By signing the filled-out form, you:
1. Certify that the TIN you are giving is correct (or you are waiting for a number to be issued),
2. Certify that you are not subject to backup withholding, or
3. Claim exemption from backup withholding if you are a U.S. exempt payee. If applicable, you are also certifying that as a U.S. person, your allocable share of any partnership income from a U.S. trade or business is not subject to the withholding tax on foreign partners’ share of effectively connected income, and
4. Certify that FATCA code(s) entered on this form (if any) indicating that you are exempt from the FATCA reporting, is correct. See What is FATCA reporting, later, for further information.
Note: If you are a U.S. person and a requester gives you a form other than Form W-9 to request your TIN, you must use the requester’s form if it is substantially similar to this Form W-9.
Definition of a U.S. person. For federal tax purposes, you are considered a U.S. person if you are:
● An individual who is a U.S. citizen or U.S. resident alien;
● A partnership, corporation, company, or association created or organized in the United States or under the laws of the United States;
● An estate (other than a foreign estate); or
● A domestic trust (as defined in Regulations section 301.7701-7).
Special rules for partnerships. Partnerships that conduct a trade or business in the United States are generally required to pay a withholding tax under section 1446 on any foreign partners’ share of effectively connected taxable income from such business. Further, in certain cases where a Form W-9 has not been received, the rules under section 1446 require a partnership to presume that a partner is a foreign person, and pay the section 1446 withholding tax. Therefore, if you are a U.S. person that is a partner in a partnership conducting a trade or business in the United States, provide Form W-9 to the partnership to establish your U.S. status and avoid section 1446 withholding on your share of partnership income.
In the cases below, the following person must give Form W-9 to the partnership for purposes of establishing its U.S. status and avoiding withholding on its allocable share of net income from the partnership conducting a trade or business in the United States.
● In the case of a disregarded entity with a U.S. owner, the U.S. owner of the disregarded entity and not the entity;
● In the case of a grantor trust with a U.S. grantor or other U.S. owner, generally, the U.S. grantor or other U.S. owner of the grantor trust and not the trust; and
● In the case of a U.S. trust (other than a grantor trust), the U.S. trust (other than a grantor trust) and not the beneficiaries of the trust.
Foreign person. If you are a foreign person or the U.S. branch of a foreign bank that has elected to be treated as a U.S. person, do not use Form W-9. Instead, use the appropriate Form W-8 or Form 8233 (see Pub. 515, Withholding of Tax on Nonresident Aliens and Foreign Entities).
Nonresident alien who becomes a resident alien. Generally, only a nonresident alien individual may use the terms of a tax treaty to reduce or eliminate U.S. tax on certain types of income. However, most tax treaties contain a provision known as a “saving clause.” Exceptions specified in the saving clause may permit an exemption from tax to continue for certain types of income even after the payee has otherwise become a U.S. resident alien for tax purposes.
If you are a U.S. resident alien who is relying on an exception contained in the saving clause of a tax treaty to claim an exemption from U.S. tax on certain types of income, you must attach a statement to Form W-9 that specifies the following five items.
1. The treaty country. Generally, this must be the same treaty under which you claimed exemption from tax as a nonresident alien.
2. The treaty article addressing the income.
3. The article number (or location) in the tax treaty that contains the saving clause and its exceptions.
4. The type and amount of income that qualifies for the exemption from tax.
5. Sufficient facts to justify the exemption from tax under the terms of the treaty article.
Example. Article 20 of the U.S.-China income tax treaty allows an exemption from tax for scholarship income received by a Chinese student temporarily present in the United States. Under U.S. law, this student will become a resident alien for tax purposes if his or her stay in the United States exceeds 5 calendar years. However, paragraph 2 of the first Protocol to the U.S.-China treaty (dated April 30, 1984) allows the provisions of Article 20 to continue to apply even after the Chinese student becomes a resident alien of the United States. A Chinese student who qualifies for this exception (under paragraph 2 of the first protocol) and is relying on this exception to claim an exemption from tax on his or her scholarship or fellowship income would attach to Form W-9 a statement that includes the information described above to support that exemption.
If you are a nonresident alien or a foreign entity, give the requester the appropriate completed Form W-8 or Form 8233.
Backup Withholding
What is backup withholding? Persons making certain payments to you must under certain conditions withhold and pay to the IRS 24% of such payments. This is called “backup withholding.” Payments that may be subject to backup withholding include interest, tax-exempt interest, dividends, broker and barter exchange transactions, rents, royalties, nonemployee pay, payments made in settlement of payment card and third party network transactions, and certain payments from fishing boat operators. Real estate transactions are not subject to backup withholding.
You will not be subject to backup withholding on payments you receive if you give the requester your correct TIN, make the proper certifications, and report all your taxable interest and dividends on your tax return.
Payments you receive will be subject to backup withholding if:
1. You do not furnish your TIN to the requester,
2. You do not certify your TIN when required (see the instructions for Part II for details),
3. The IRS tells the requester that you furnished an incorrect TIN,
4. The IRS tells you that you are subject to backup withholding because you did not report all your interest and dividends on your tax return (for reportable interest and dividends only), or
5. You do not certify to the requester that you are not subject to backup withholding under 4 above (for reportable interest and dividend accounts opened after 1983 only).
Certain payees and payments are exempt from backup withholding. See Exempt payee code, later, and the separate Instructions for the Requester of Form W-9 for more information.
Also see Special rules for partnerships, earlier.
What is FATCA Reporting?
The Foreign Account Tax Compliance Act (FATCA) requires a participating foreign financial institution to report all United States account holders that are specified United States persons. Certain payees are exempt from FATCA reporting. See Exemption from FATCA reporting code, later, and the Instructions for the Requester of Form W-9 for more information.
Updating Your Information
You must provide updated information to any person to whom you claimed to be an exempt payee if you are no longer an exempt payee and anticipate receiving reportable payments in the future from this person. For example, you may need to provide updated information if you are a C corporation that elects to be an S corporation, or if you no longer are tax exempt. In addition, you must furnish a new Form W-9 if the name or TIN changes for the account; for example, if the grantor of a grantor trust dies.
Penalties
Failure to furnish TIN. If you fail to furnish your correct TIN to a requester, you are subject to a penalty of $50 for each such failure unless your failure is due to reasonable cause and not to willful neglect.
Civil penalty for false information with respect to withholding. If you make a false statement with no reasonable basis that results in no backup withholding, you are subject to a $500 penalty.
Criminal penalty for falsifying information. Willfully falsifying certifications or affirmations may subject you to criminal penalties including fines and/or imprisonment.
| Form W-9 (Rev. 10-2018) | Page 3 |
Misuse of TINs. If the requester discloses or uses TINs in violation of federal law, the requester may be subject to civil and criminal penalties.
Specific Instructions
Line 1
You must enter one of the following on this line; do not leave this line blank. The name should match the name on your tax return.
If this Form W-9 is for a joint account (other than an account maintained by a foreign financial institution (FFI)), list first, and then circle, the name of the person or entity whose number you entered in Part I of Form W-9. If you are providing Form W-9 to an FFI to document a joint account, each holder of the account that is a U.S. person must provide a Form W-9.
a. Individual. Generally, enter the name shown on your tax return. If you have changed your last name without informing the Social Security Administration (SSA) of the name change, enter your first name, the last name as shown on your social security card, and your new last name.
Note: ITIN applicant: Enter your individual name as it was entered on your Form W-7application, line 1a. This should also be the same as the name you entered on the Form 1040/1040A/1040EZ you filed with your application.
b. Sole proprietor or single-member LLC. Enter your individual name as shown on your 1040/1040A/1040EZ on line 1. You may enter your business, trade, or “doing business as” (DBA) name on line 2.
c. Partnership, LLC that is not a single-member LLC, C corporation, or S corporation. Enter the entity’s name as shown on the entity’s tax return on line 1 and any business, trade, or DBA name on line 2.
d. Other entities. Enter your name as shown on required U.S. federal tax documents on line 1. This name should match the name shown on the charter or other legal document creating the entity. You may enter any business, trade, or DBA name on line 2.
e. Disregarded entity. For U.S. federal tax purposes, an entity that is disregarded as an entity separate from its owner is treated as a “disregarded entity.” See Regulations section 301.7701-2(c)(2)(iii). Enter the owner’s name on line 1. The name of the entity entered on line 1 should never be a disregarded entity. The name on line 1 should be the name shown on the income tax return on which the income should be reported. For example, if a foreign LLC that is treated as a disregarded entity for U.S. federal tax purposes has a single owner that is a U.S. person, the U.S. owner’s name is required to be provided on line 1. If the direct owner of the entity is also a disregarded entity, enter the first owner that is not disregarded for federal tax purposes. Enter the disregarded entity’s name on line 2, “Business name/disregarded entity name.” If the owner of the disregarded entity is a foreign person, the owner must complete an appropriate Form W-8 instead of a Form W-9.This is the case even if the foreign person has a U.S. TIN.
Line 2
If you have a business name, trade name, DBA name, or disregarded entity name, you may enter it on line 2.
Line 3
Check the appropriate box on line 3 for the U.S. federal tax classification of the person whose name is entered on line 1. Check only one box on line 3.
|
IF the entity/person on line 1 is a(n) . . . |
THEN check the box for . . . | ||
| ● Corporation | Corporation | ||
|
● Individual
● Sole proprietorship, or
● Single-member limited liability company (LLC) owned by an individual and disregarded for U.S. federal tax purposes.
|
Individual/sole proprietor or single-member LLC | ||
|
● LLC treated as a partnership for U.S. federal tax purposes,
● LLC that has filed Form 8832 or 2553 to be taxed as a corporation, or
● LLC that is disregarded as an entity separate from its owner but the owner is another LLC that is not disregarded for U.S. federal tax purposes.
|
Limited liability company and enter the appropriate tax classification. (P= Partnership; C= C corporation; or S= S corporation) |
||
|
● Partnership
|
Partnership | ||
|
● Trust/estate
|
Trust/estate |
Line 4, Exemptions
If you are exempt from backup withholding and/or FATCA reporting, enter in the appropriate space on line 4 any code(s) that may apply to you.
Exempt payee code.
● Generally, individuals (including sole proprietors) are not exempt from backup withholding.
● Except as provided below, corporations are exempt from backup withholding for certain payments, including interest and dividends.
● Corporations are not exempt from backup withholding for payments made in settlement of payment card or third party network transactions.
● Corporations are not exempt from backup withholding with respect to attorneys’ fees or gross proceeds paid to attorneys, and corporations that provide medical or health care services are not exempt with respect to payments reportable on Form 1099-MISC.
The following codes identify payees that are exempt from backup withholding. Enter the appropriate code in the space in line 4.
1 – An organization exempt from tax under section 501(a), any IRA, or a custodial account under section 403(b)(7) if the account satisfies the requirements of section 401(f)(2)
2 – The United States or any of its agencies or instrumentalities
3 – A state, the District of Columbia, a U.S. commonwealth or possession, or any of their political subdivisions or instrumentalities
4 – A foreign government or any of its political subdivisions, agencies, or instrumentalities
5 – A corporation
6 – A dealer in securities or commodities required to register in the United States, the District of Columbia, or a U.S. commonwealth or possession
7 – A futures commission merchant registered with the Commodity Futures Trading Commission
8 – A real estate investment trust
9 – An entity registered at all times during the tax year under the Investment Company Act of 1940
10 – A common trust fund operated by a bank under section 584(a)
11 – A financial institution
12 – A middleman known in the investment community as a nominee or custodian
13 – A trust exempt from tax under section 664 or described in section 4947
| Form W-9 (Rev. 10-2018) | Page 4 |
The following chart shows types of payments that may be exempt from backup withholding. The chart applies to the exempt payees listed above, 1 through 13.
| IF the payment is for . . . | THEN the payment is exempt for . . . | |
|
Interest and dividend payments
|
All exempt payees except
| |
| Broker transactions |
Exempt payees 1 through 4 and 6 through 11 and all C corporations. S corporations must not enter an exempt payee code because they are exempt only for sales of noncovered securities acquired prior to 2012.
| |
|
Barter exchange transactions and patronage dividends
|
Exempt payees 1 through 4 | |
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Payments over $600 required to be reported and direct sales over $5,0001
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Generally, exempt payees 1 through 52 | |
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Payments made in settlement of payment card or third party network transactions
|
Exempt payees 1 through 4 |
| 1 | See Form 1099-MISC, Miscellaneous Income, and its instructions. |
| 2 | However, the following payments made to a corporation and reportable on Form 1099-MISC are not exempt from backup withholding: medical and health care payments, attorneys’ fees, gross proceeds paid to an attorney reportable under section 6045(f), and payments for services paid by a federal executive agency. |
Exemption from FATCA reporting code. The following codes identify payees that are exempt from reporting under FATCA. These codes apply to persons submitting this form for accounts maintained outside of the United States by certain foreign financial institutions. Therefore, if you are only submitting this form for an account you hold in the United States, you may leave this field blank. Consult with the person requesting this form if you are uncertain if the financial institution is subject to these requirements. A requester may indicate that a code is not required by providing you with a Form W-9 with “Not Applicable” (or any similar indication) written or printed on the line for a FATCA exemption code.
A – An organization exempt from tax under section 501(a) or any individual retirement plan as defined in section 7701(a)(37)
B – The United States or any of its agencies or instrumentalities
C – A state, the District of Columbia, a U.S. commonwealth or possession, or any of their political subdivisions or instrumentalities
D – A corporation the stock of which is regularly traded on one or more established securities markets, as described in Regulations section 1.1472-1(c)(1)(i)
E – A corporation that is a member of the same expanded affiliated group as a corporation described in Regulations section 1.1472-1(c)(1)(i)
F – A dealer in securities, commodities, or derivative financial instruments (including notional principal contracts, futures, forwards, and options) that is registered as such under the laws of the United States or any state
G – A real estate investment trust
H – A regulated investment company as defined in section 851 or an entity registered at all times during the tax year under the Investment Company Act of 1940
I – A common trust fund as defined in section 584(a)
J – A bank as defined in section 581
K – A broker
L – A trust exempt from tax under section 664 or described in section 4947(a)(1)
M – A tax exempt trust under a section 403(b) plan or section 457(g) plan
Note: You may wish to consult with the financial institution requesting this form to determine whether the FATCA code and/or exempt payee code should be completed.
Line 5
Enter your address (number, street, and apartment or suite number). This is where the requester of this Form W-9 will mail your information returns. If this address differs from the one the requester already has on file, write NEW
at the top. If a new address is provided, there is still a chance the old address will be used until the payor changes your address in their records.
Line 6
Enter your city, state, and ZIP code.
Part I. Taxpayer Identification Number (TIN)
Enter your TIN in the appropriate box. If you are a resident alien and you do not have and are not eligible to get an SSN, your TIN is your IRS individual taxpayer identification number (ITIN). Enter it in the social security number box. If you do not have an ITIN, see How to get a TIN below.
If you are a sole proprietor and you have an EIN, you may enter either your SSN or EIN.
If you are a single-member LLC that is disregarded as an entity separate from its owner, enter the owner’s SSN (or EIN, if the owner has one). Do not enter the disregarded entity’s EIN. If the LLC is classified as a corporation or partnership, enter the entity’s EIN.
Note: See What Name and Number To Give the Requester, later, for further clarification of name and TIN combinations.
How to get a TIN. If you do not have a TIN, apply for one immediately. To apply for an SSN, get Form SS-5, Application for a Social Security Card, from your local SSA office or get this form online at www.SSA.gov. You may also get this form by calling 1-800-772-1213.Use Form W-7, Application for IRS Individual Taxpayer Identification Number, to apply for an ITIN, or Form SS-4, Application for Employer Identification Number, to apply for an EIN. You can apply for an EIN online by
accessing the IRS website atwww.irs.gov/Businesses and clicking on Employer Identification Number (EIN) under Starting a Business. Go to www.irs.gov/Forms to view, download, or print Form W-7 and/or Form SS-4. Or, you can go to www.irs.gov/OrderForms to place an order and have Form W-7and/or SS-4 mailed to you within 10 business days.
If you are asked to complete Form W-9 but do not have a TIN, apply for a TIN and write “Applied For” in the space for the TIN, sign and date the form, and give it to the requester. For interest and dividend payments, and certain payments made with respect to readily tradable instruments, generally you will have 60 days to get a TIN and give it to the requester before you are subject to backup withholding on payments. The 60-day rule does not apply to other types of payments. You will be subject to backup withholding on all such payments until you provide your TIN to the requester.
Note: Entering “Applied For” means that you have already applied for a TIN or that you intend to apply for one soon.
Caution: A disregarded U.S. entity that has a foreign owner must use the appropriate Form W-8.
Part II. Certification
To establish to the withholding agent that you are a U.S. person, or resident alien, sign Form W-9. You may be requested to sign by the withholding agent even if item 1, 4, or 5 below indicates otherwise.
For a joint account, only the person whose TIN is shown in Part I should sign (when required). In the case of a disregarded entity, the person identified on line 1 must sign. Exempt payees, see Exempt payee code, earlier.
Signature requirements. Complete the certification as indicated in items 1 through 5 below.
1. Interest, dividend, and barter exchange accounts opened before 1984 and broker accounts considered active during 1983. You must give your correct TIN, but you do not have to sign the certification.
2. Interest, dividend, broker, and barter exchange accounts opened after 1983 and broker accounts considered inactive during 1983. You must sign the certification or backup withholding will apply. If you are subject to backup withholding and you are merely providing your correct TIN to the requester, you must cross out item 2 in the certification before signing the form.
3. Real estate transactions. You must sign the certification. You may cross out item 2 of the certification.
4. Other payments. You must give your correct TIN, but you do not have to sign the certification unless you have been notified that you have previously given an incorrect TIN. “Other payments” include payments made in the course of the requester’s trade or business for rents, royalties, goods (other than bills for merchandise), medical and health care services (including payments to corporations), payments to a nonemployee for services, payments made in settlement of payment card and third party network transactions,
| Form W-9 (Rev. 10-2018) | Page 5 |
payments to certain fishing boat crew members and fishermen, and gross proceeds paid to attorneys (including payments to corporations).
5. Mortgage interest paid by you, acquisition or abandonment of secured property, cancellation of debt, qualified tuition program payments (under section 529), ABLE accounts (under section 529A), IRA, Coverdell ESA, Archer MSA or HSA contributions or distributions, and pension distributions. You must give your correct TIN, but you do not have to sign the certification.
What Name and Number To Give the Requester
| For this type of account: | Give name and SSN of: | |||||
| 1. | Individual | The individual | ||||
| 2. | Two or more individuals (joint account) other than an account maintained by an FFI | The actual owner of the account or, if combined funds, the first individual on the account1 | ||||
| 3. | Two or more U.S. persons (joint account maintained by an FFI) | Each holder of the account | ||||
| 4. | Custodial account of a minor (Uniform Gift to Minors Act) | The minor2 | ||||
| 5. | a. The usual revocable savings trust (grantor is also trustee) | The grantor-trustee1 | ||||
| b. So-called trust account that is not a legal or valid trust under state law | The actual owner1 | |||||
| 6. | Sole proprietorship or disregarded entity owned by an individual | The owner3 | ||||
| 7. | Grantor trust filing under Optional Form 1099 Filing Method 1 (see Regulations section 1.671-4(b)(2)(i)(A)) | The grantor* | ||||
| For this type of account: | Give name and EIN of: | |||||
| 8. | Disregarded entity not owned by an individual | The owner | ||||
| 9. | A valid trust, estate, or pension trust | Legal entity4 | ||||
| 10. | Corporation or LLC electing corporate status on Form 8832 or Form 2553 | The corporation | ||||
| 11. | Association, club, religious, charitable, educational, or other tax-exempt organization | The organization | ||||
| 12. | Partnership or multi-member LLC | The partnership | ||||
| 13. | A broker or registered nominee | The broker or nominee | ||||
| 14. | Account with the Department of Agriculture in the name of a public entity (such as a state or local government, school district, or prison) that receives agricultural program payments | The public entity | ||||
| 15. | Grantor trust filing under the Form 1041 Filing Method or the Optional Form 1099 Filing Method 2 (see Regulations section 1.671-4(b)(2)(i)(B)) | The trust | ||||
| 1 | List first and circle the name of the person whose number you furnish. If only one person on a joint account has an SSN, that person’s number must be furnished. |
| 2 | Circle the minor’s name and furnish the minor’s SSN. |
| 3 | You must show your individual name and you may also enter your business or DBA name on the “Business name/disregarded entity” name line. You may use either your SSN or EIN (if you have one), but the IRS encourages you to use your SSN. |
| 4 | List first and circle the name of the trust, estate, or pension trust. (Do not furnish the TIN of the personal representative or trustee unless the legal entity itself is not designated in the account title.) Also see Special rules for partnerships, earlier. |
| *Note: | The grantor also must provide a Form W-9 to trustee of trust. |
Note: If no name is circled when more than one name is listed, the number will be considered to be that of the first name listed.
Secure Your Tax Records From Identity Theft
Identity theft occurs when someone uses your personal information such as your name, SSN, or other identifying information, without your permission, to commit fraud or other crimes. An identity thief may use your SSN to get a job or may file a tax return using your SSN to receive a refund.
To reduce your risk:
● Protect your SSN,
● Ensure your employer is protecting your SSN, and
● Be careful when choosing a tax preparer.
If your tax records are affected by identity theft and you receive a notice from the IRS, respond right away to the name and phone number printed on the IRS notice or letter.
If your tax records are not currently affected by identity theft but you think you are at risk due to a lost or stolen purse or wallet, questionable credit card activity or credit report, contact the IRS Identity Theft Hotline at 1-800-908-4490 or submit Form 14039.
For more information, see Pub. 5027, Identity Theft Information for Taxpayers.
Victims of identity theft who are experiencing economic harm or a systemic problem, or are seeking help in resolving tax problems that have not been resolved through normal channels, may be eligible for Taxpayer Advocate Service (TAS) assistance. You can reach TAS by calling the TAS toll-free case intake line at 1-877-777-4778 or TTY/TDD 1-800-829-4059.
Protect yourself from suspicious emails or phishing schemes. Phishing is the creation and use of email and websites designed to mimic legitimate business emails and websites. The most common act is sending an email to a user falsely claiming to be an established legitimate enterprise in an attempt to scam the user into surrendering private information that will be used for identity theft.
The IRS does not initiate contacts with taxpayers via emails. Also, the IRS does not request personal detailed information through email or ask taxpayers for the PIN numbers, passwords, or similar secret access information for their credit card, bank, or other financial accounts.
If you receive an unsolicited email claiming to be from the IRS, forward this message to phishing@irs.gov. You may also report misuse of the IRS name, logo, or other IRS property to the Treasury Inspector General for Tax Administration (TIGTA) at 1-800-366-4484. You can forward suspicious emails to the Federal Trade Commission at spam@uce.gov or report them at www.ftc.gov/complaint. You can contact the FTC at www.ftc.gov/idtheft or 877-IDTHEFT (877-438-4338). If you have been the victim of identity theft, see www.IdentityTheft.gov and Pub. 5027.
Visit www.irs.gov/IdentityTheft to learn more about identity theft and how to reduce your risk.
Privacy Act Notice
Section 6109 of the Internal Revenue Code requires you to provide your correct TIN to persons (including federal agencies) who are required to file information returns with the IRS to report interest, dividends, or certain other income paid to you; mortgage interest you paid; the acquisition or abandonment of secured property; the cancellation of debt; or contributions you made to an IRA, Archer MSA, or HSA. The person collecting this form uses the information on the form to file information returns with the IRS, reporting the above information. Routine uses of this information include giving it to the Department of Justice for civil and criminal litigation and to cities, states, the District of Columbia, and U.S. commonwealths and possessions for use in administering their laws. The information also may be disclosed to other countries under a treaty, to federal and state agencies to enforce civil and criminal laws, or to federal law enforcement and intelligence agencies to combat terrorism. You must provide your TIN whether or not you are required to file a tax return. Under section 3406, payers must generally withhold a percentage of taxable interest, dividend, and certain other payments to a payee who does not give a TIN to the payer. Certain penalties may also apply for providing false or fraudulent information.
Important: The Depositary must receive this Letter of Transmittal (together with confirmation of the book-entry transfer and all other required documents) before the Expiration Date, as defined in the Offer to Purchase.
The Letter of Transmittal and any other required documents should be sent or delivered by each tendering shareholder or its broker, dealer, commercial bank, trust company or other nominee to the Depositary at one of its addresses set forth on the first page of this Letter of Transmittal.
Any questions, requests for assistance or for additional copies of the Offer to Purchase or the Letter of Transmittal may be directed to AST Fund Solutions, LLC, the Information Agent, at the telephone number and address set forth below. You may also contact your broker, dealer, commercial bank or trust company for assistance concerning the tender offer. To confirm delivery of your shares, please contact the Depositary.
The Depositary for the Offer is:
|
If delivering by hand, mail, express mail, courier or any other expedited service:
American Stock Transfer & Trust Company,
LLC
Toll-Free 800-848-3051
If delivering by facsimile transmission: 718-234-5001 |
||||||
The Information Agent for the Offer is:
AST Fund Solutions, LLC
48 Wall Street, 22nd Floor
New York, New York 10005
Toll-Free 1-877-732-3614
EXHIBIT (a)(1)(iii)
OFFER BY
EATON VANCE SENIOR INCOME TRUST
Two International Place
Boston, Massachusetts 02110
(800) 262-1122
To Purchase For Cash Up to 60% or 22,719,965 of its Outstanding Common Shares of Beneficial Interest
At 99% of Net Asset Value Per Share
THE FUND’S OFFER AND WITHDRAWAL RIGHTS
WILL EXPIRE AT 5:00 P.M., EASTERN TIME
ON JULY 30, 2021, UNLESS THE OFFER IS EXTENDED.
June 29, 2021
To Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees:
Eaton Vance Senior Income Trust, a Massachusetts business trust registered under the Investment Company Act of 1940, as amended, as a closed-end management investment company (the “Fund” or “we”), is proposing to purchase for cash up to 22,719,965 (i.e., up to 60%) of its issued and outstanding common shares of beneficial interest at a price per share equal to 99% of its net asset value (“NAV”) per share as of the close of regular trading of the New York Stock Exchange on the date the offer expires, or if the offer period is extended, as of the close of regular trading of the NYSE on the newly designated expiration date, upon the terms and subject to the conditions set forth in the Offer to Purchase, dated June 29, 2021, and the related Letter of Transmittal (which together, as they may be amended and supplemented from time to time, constitute the “Offer”). Please furnish copies of the enclosed materials to those of your clients for whom you hold shares registered in your name or in the name of your nominee.
All shares validly tendered before 5:00 p.m., Eastern Time on July 30, 2021 or the latest date to which the Fund extends the Offer (the later of July 30, 2021 and the latest time or date to which the Offer is extended, the “Expiration Date”) and not properly withdrawn will be purchased by the Fund at a price per share equal to 99% of its NAV per share as of the close of regular trading of the New York Stock Exchange on the Expiration Date, subject to the terms and conditions of the Offer, including proration provisions. All shares that the Fund does not accept for purchase because of proration will be returned at the Fund’s expense to the shareholders that tendered such shares promptly after the Expiration Date.
As described in the Offer to Purchase, if more than 60% or 22,719,965 shares are validly tendered and not properly withdrawn before the Expiration Date, then the Fund will purchase validly tendered shares tendered at a price per share equal to 99% of its NAV per share as of the close of regular trading of the New York Stock Exchange on the Expiration Date on a pro rata basis (disregarding fractional shares).
The Offer is not conditioned on any minimum number of shares being tendered. The Offer is, however, subject to other conditions. See Sections 1 and 13 of the Offer to Purchase.
For your information and for forwarding to your clients for whom you hold shares registered in your name or in the name of your nominee, we are enclosing the following documents:
1. Offer to Purchase, dated June 29, 2021;
2. Form of Letter to Clients, which you may send to your clients for whom you hold shares registered in your name or in the name of your nominee, with an accompanying Instruction Form provided for obtaining such clients’ instructions with regard to the Offer;
3. Form of Letter of Transmittal, for your use and for the information of your clients, together with accompanying instructions, IRS Form W-9 and the instructions included therewith;
4. Return envelope addressed to American Stock Transfer & Trust Company, LLC, the depositary for the Offer (the “Depositary”).
WE URGE YOU TO CONTACT YOUR CLIENTS AS PROMPTLY AS POSSIBLE. THE FUND’S OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., EASTERN TIME, ON JULY 30, 2021, UNLESS THE OFFER IS EXTENDED.
No fees or commissions will be payable to brokers, dealers, commercial banks, trust companies or any person for soliciting tenders of shares under the Offer other than fees paid to AST Fund Solutions, LLC, the information agent for the Offer (the “Information Agent”), as described in the Offer to Purchase. We will, however, upon request, reimburse or cause to be reimbursed brokers, dealers, commercial banks and trust companies for reasonable and necessary costs and expenses incurred by them in forwarding the enclosed materials to their customers who are beneficial owners of shares held by them as a nominee or in a fiduciary capacity. We will pay or cause to be paid any stock transfer taxes applicable to our purchase of shares pursuant to the Offer, except as otherwise provided in the Offer to Purchase and Letter of Transmittal (see Instruction 6 of the Letter of Transmittal). No broker, dealer, bank, trust company or fiduciary shall be deemed to be an agent of the Fund, the Information Agent or the Depositary or any affiliate of the foregoing for purposes of the Offer.
For shares to be validly tendered pursuant to the Offer, the Depositary must timely receive confirmation of receipt of such shares under the procedure for book-entry transfer, together with a properly completed and duly executed Letter of Transmittal, including any required signature guarantees or an “agent’s message” (as defined in the Offer to Purchase and the Letter of Transmittal) and any other documents required pursuant to the Offer, all in accordance with the instructions set forth in the Offer to Purchase and Letter of Transmittal.
None of the Fund, its Board of Trustees, Eaton Vance Management, the Fund’s investment adviser, or its Information Agent makes any recommendation to any shareholder as to whether to tender or refrain from tendering any shares. Shareholders should carefully evaluate all information in the Offer, should consult their own investment and tax advisors, and should make their own decisions about whether to tender shares, and, if so, how many shares to tender. The Offer is not being made to (nor will tenders be accepted from or on behalf of) shareholders in any jurisdiction in which the making of the Offer or the acceptance thereof would not be in compliance with the laws of such jurisdiction.
Please address any inquiries you may have with respect to the Information Agent at its address set forth on the back cover page of the Offer to Purchase and telephone number set forth below.
You may obtain additional copies of the enclosed material from the Information Agent by calling them at: 1-877-732-3614.
Capitalized terms used but not defined herein have the meanings assigned to them in the Offer to Purchase and the Letter of Transmittal.
| Very truly yours, |
| Eaton Vance Senior Income Trust |
Enclosures
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU OR ANY OTHER PERSON AN AGENT OF THE FUND, THE INFORMATION AGENT OR THE DEPOSITARY OR ANY AFFILIATE OF THE FOREGOING, OR AUTHORIZE YOU OR ANY OTHER PERSON TO USE ANY DOCUMENT OR MAKE ANY STATEMENT ON BEHALF OF ANY OF THEM IN CONNECTION WITH THE OFFER OTHER THAN THE DOCUMENTS ENCLOSED HEREWITH AND THE STATEMENTS CONTAINED THEREIN.
EXHIBIT (a)(1)(iv)
OFFER BY
EATON VANCE SENIOR INCOME TRUST
Two International Place
Boston, Massachusetts 02110
(800) 262-1122
To Purchase For Cash Up to 60% or 22,719,965 of its Outstanding Common Shares of Beneficial Interest
At 99% of Net Asset Value Per Share
THE FUND’S OFFER AND WITHDRAWAL RIGHTS
WILL EXPIRE AT 5:00 P.M., EASTERN TIME
ON JULY 30, 2021, UNLESS THE OFFER IS EXTENDED.
June 29, 2021
To Our Clients:
Enclosed for your consideration are the Offer to Purchase, dated June 29, 2021, and the related Letter of Transmittal (which together, as they may be amended and supplemented from time to time, constitute the “Offer”), in connection with the offer by Eaton Vance Senior Income Trust, a Massachusetts business trust registered under the Investment Company Act of 1940, as amended, as a closed-end management investment company (the “Fund”), to purchase for cash up to 22,719,965 (i.e., up to 60%) of its issued and outstanding common shares of beneficial interest at a price per share equal to 99% of its net asset value (“NAV”) per share as of the close of regular trading of the New York Stock Exchange on the date the Offer expires, upon the terms and subject to the conditions of the Offer.
All shares validly tendered before 5:00 p.m. Eastern Time on July 30, 2021 or the latest date to which the Fund extends the Offer (the later of July 30, 2021 and the latest time or date to which the Offer is extended, the “Expiration Date”) and not properly withdrawn will be purchased by the Fund at a price per share equal to 99% of its NAV per share as of the close of regular trading of the New York Stock Exchange on the Expiration Date, subject to the terms and conditions thereof, including proration provisions. All shares that the Fund does not accept for purchase because of proration will be returned at the Fund’s expense to the shareholders that tendered such shares promptly after the Expiration Date.
We are the owner of record of shares held for your account. As such, we are the only ones who can tender your shares, and then only pursuant to your instructions. We are sending you the Letter of Transmittal for your information only. You cannot use the Letter of Transmittal to tender shares we hold for your account.
Please instruct us as to whether you wish us to tender, on the terms and subject to the conditions of the Offer, any or all of the shares we hold for your account, by completing and signing the Instruction Form enclosed herein.
Please note carefully the following:
1. You should consult with your broker and/or tax advisor as to whether (and if so, in what manner) you should designate the priority in which you want your tendered shares to be purchased if less than all of your shares are to be purchased;
2. The Offer is not conditioned upon any minimum number of shares being tendered. The Offer is, however, subject to other conditions set forth in Sections 1 and 13 of the Offer to Purchase, which you should read carefully.
3. The Offer and the withdrawal rights will expire at 5:00 p.m., Eastern Time, on July 30, 2021, unless the Offer is extended.
4. The Offer is for up to 22,719,965 (i.e., up to 60%) of the Fund’s issued and outstanding shares of common stock as of June 23, 2021.
5. No fees or commissions will be payable to the Fund in connection with the Offer. However, brokers and other nominees who tender their shares of common stock pursuant to your instructions may charge you a fee for doing so. Any stock transfer taxes applicable to the sale of shares of common stock to the Fund pursuant to the Offer will be paid by the Fund except as otherwise provided in the Offer to Purchase and Letter of Transmittal (see Instruction 6 of the Letter of Transmittal).
6. The Board of Trustees of the Fund (the “Board”) has approved the Offer. However, none of the Fund, its Board, Eaton Vance Management, the Fund’s investment adviser, or AST Fund Solutions, LLC, the information agent for the Offer (the “Information Agent”), makes any recommendation to any shareholder as to whether to tender or refrain from tendering any shares. Shareholders should carefully evaluate all information in the Offer, should consult their own investment and tax advisors, and should make their own decisions about whether to tender shares, and, if so, how many shares to tender.
The current NAV per share of the Fund will be calculated daily and may be obtained by calling the Information Agent at 1-877-732-3614 (toll-free).
If you wish to have us tender any or all of your shares, please instruct us to that effect by completing, executing and returning to us the enclosed Instruction Form. If you authorize us to tender your shares, we will tender all of the shares that we hold beneficially for your account unless you specify otherwise on the enclosed Instruction Form.
Please forward your completed Instruction Form to us in a timely manner to give us ample time to permit us to submit the tender on your behalf before the Expiration Date of the Offer. The Offer and withdrawal rights will expire at 5:00 p.m., Eastern Time, on July 30, 2021, unless the Fund extends the Offer.
As described in the Offer to Purchase, if more than 60% or 22,719,965 shares are validly tendered and not properly withdrawn before the Expiration Date, then the Fund will purchase validly tendered shares on a pro rata basis (disregarding fractional shares).
The Offer is being made solely under the Offer to Purchase and the Letter of Transmittal. The Offer is not being made to, nor will tenders be accepted from or on behalf of, holders of shares residing in any jurisdiction in which the making of the Offer or acceptance thereof would not be in compliance with the securities, blue sky or other laws of such jurisdiction.
Payment for shares purchased pursuant to the Offer will in all cases be made only after timely receipt by American Stock Transfer & Trust Company, LLC, the depositary for the Offer (the “Depositary”), of: (a) timely confirmation of the book-entry transfer of such shares into the account maintained by the Depositary at The Depository Trust Company (the “Book-Entry Transfer Facility”) pursuant to the procedures set forth in Section 3 of the Offer to Purchase; (b) an agent’s message (as defined in the Offer to Purchase), in connection with a book-entry delivery, or the Letter of Transmittal, properly completed and duly executed, with any required signature guarantees; and (c) any other documents required by the Letter of Transmittal. Accordingly, payment may not be made to all tendering shareholders at the same time depending upon when confirmation of book-entry transfer of such shares into the Depositary’s account at the Book-Entry Transfer Facility are actually received by the Depositary.
YOUR PROMPT ACTION IS REQUESTED. PLEASE FORWARD YOUR COMPLETED INSTRUCTION FORM TO US IN AMPLE TIME TO PERMIT US TO SUBMIT THE TENDER ON YOUR BEHALF BEFORE THE EXPIRATION OF THE OFFER.
INSTRUCTION FORM
With Respect to the Offer by
EATON VANCE SENIOR INCOME TRUST
to Purchase For Cash Up to 60% or 22,719,965 of its Outstanding Common Shares of Beneficial Interest
At 99% of Net Asset Value Per Share
The undersigned acknowledge(s) receipt of your letter in connection with the offer by Eaton Vance Senior Income Trust, a Massachusetts business trust registered under the Investment Company Act of 1940, as amended, as a closed-end management investment company (the “Fund”), to purchase for cash up to 22,719,965 (i.e., up to 60%) of its issued and outstanding common shares of beneficial interest at a price per share equal to 99% of its net asset value (“NAV”) per share as of the close of regular trading of the New York Stock Exchange on the date the offer expires, upon the terms and subject to the conditions set forth in the Offer to Purchase, dated June 29, 2021, and the related Letter of Transmittal (which, together with any supplements or amendments thereto, collectively constitute the “Offer”).
All shares validly tendered before 5:00 p.m. Eastern Time on July 30, 2021, or the latest date to which the Fund extends the Offer, whichever is later (the “Expiration Date”) and not properly withdrawn will be purchased by the Fund at a price per share equal to 99% of its NAV per share as of the close of regular trading of the New York Stock Exchange on the Expiration Date, subject to the terms and conditions of the Offer, including proration provisions. All shares that the Fund does not accept for purchase because of proration will be returned at the Fund’s expense to the shareholders that tendered such shares promptly after the Expiration Date.
The undersigned hereby instruct(s) you to tender to the Fund the number of shares indicated below or, if no number is indicated, all shares you hold for the account of the undersigned, in accordance with the terms and subject to the conditions of the Offer.
NUMBER OF SHARES TO BE TENDERED BY YOU FOR
THE ACCOUNT OF THE UNDERSIGNED:
SHARES*
| * | Unless you indicate otherwise, we will assume that you are instructing us to tender all of the shares that we hold for your account. |
THE METHOD OF DELIVERY OF THIS DOCUMENT IS AT THE OPTION AND RISK OF THE
TENDERING SHAREHOLDER. IF DELIVERY IS BY MAIL, WE RECOMMEND REGISTERED MAIL
WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED. IN ALL CASES, PLEASE ALLOW
SUFFICIENT TIME TO ENSURE DELIVERY.
-PLEASE SIGN ON THE NEXT PAGE-
| Signature(s): | ||
| Name(s): | ||
| (Please Print) | ||
| Address(es): | ||
| (Please Include Zip Code) | ||
|
Telephone Number(s), including Area Code(s): |
||
|
Taxpayer ID or Social Security No.: |
||
| Dated: | ||
EXHIBIT (a)(1)(v)
Instructions for Withdrawal
of
Previously Tendered Common Shares of Beneficial Interest
of
Eaton Vance Senior Income Trust
If you tendered shares to Eaton Vance Senior Income Trust, a Massachusetts business trust registered under the Investment Company Act of 1940 as a closed-end management investment company (the “Fund”), in connection with the offer by the Fund to purchase for cash up to 22,719,965 (i.e., up to 60%) of its issued and outstanding shares of common stock (the “Shares”), upon the terms and subject to the conditions set forth in the Offer to Purchase dated June 29, 2021 and the related Letter of Transmittal (which together constitute the “Offer”), and you wish to withdraw your tender of all or any of your Shares, please fill out the attached Notice of Withdrawal. If your Shares are registered in the name of your broker, dealer, commercial bank, trust company or other nominee (“Nominee Holder”), contact that Nominee Holder to withdraw your tendered Shares.
1. Withdrawal. If you have tendered your Shares pursuant to the Offer, you may withdraw your Shares previously tendered by completing, executing and sending the attached “Notice of Withdrawal” to any one of the addresses set forth on the first page of the Notice of Withdrawal. If your Shares are registered in the name of your Nominee Holder, contact that Nominee Holder to withdraw your tendered Shares.
2. Delivery of Notice of Withdrawal. American Stock Transfer & Trust Company, LLC (the “Depositary”) must receive the Notice of Withdrawal prior to 5:00 p.m., Eastern Time, on July 30, 2021 (the “Expiration Date”), or if the Offer period is extended, by the close of regular trading of the New York Stock Exchange on the newly designated expiration date (the later of July 30, 2021 and the latest time or date to which the Offer is extended, the “Expiration Date”). The method of delivery of any documents related to a withdrawal is at the option and risk of the withdrawing holder of Shares. Any documents related to a withdrawal will be deemed delivered only when actually received by the Depositary. If delivery is by mail, registered mail with return receipt requested, properly insured, is recommended. In all cases, sufficient time should be allowed to ensure timely delivery. If your Shares are registered in the name of your Nominee Holder, you may need to allow such Nominee Holder additional time to withdraw your tendered Shares on or before the Expiration Date. You should consult your Nominee Holder to determine if there is an earlier deadline by which you must inform such Nominee Holder of any decision to withdraw your tendered Shares.
3. Procedures and Signatures. The Notice of Withdrawal must specify the name of the person who tendered the Shares to be withdrawn and the number of Shares to be withdrawn and the name of the registered holder of Shares, if different from that of the person who tendered such Shares. The Notice of Withdrawal must specify the name and number of the account at the book-entry transfer facility to be credited with the withdrawn Shares (which must be the same name, number, and book-entry transfer facility from which the Shares were tendered), and must comply with the procedures of The Depository Trust Company. If this Notice of Withdrawal is signed by trustees, executors, administrators, guardians, agents, attorneys-in-fact, officers of corporations or others acting in a fiduciary or representative capacity, such persons should so indicate when signing, should indicate location of signing and must submit proper evidence satisfactory to the Fund of their authority to so act.
NOTICE OF WITHDRAWAL
of Common Shares of Beneficial Interest (“Shares”)
of
Eaton Vance Senior Income Trust
Previously Tendered
Pursuant to the Offer to Purchase Dated June 29, 2021
THE WITHDRAWAL DEADLINE IS 5:00 P.M., EASTERN TIME,
ON JULY 30, 2021, UNLESS EXTENDED
This Notice of Withdrawal is Submitted to:
American Stock Transfer & Trust Company, LLC
Via Email:
info@astfinancial.com
|
If delivering by hand, mail, express mail, courier or any other expedited service:
American Stock Transfer & Trust Company, LLC Operations Center Attn: Reorganization Department 6201 15th Avenue Brooklyn, New York 11219
|
|
If delivering by facsimile transmission:
718-234-5001 |
| DESCRIPTION OF SHARES WITHDRAWN | |
| Name(s), Account Number(s) and Addresses of Registered Holder(s): (Please Fill in, if Blank, Exactly as Name(s) Appear(s) on Account Registration) | Number of Shares Withdrawn (Please check appropriate box below)* |
|
Number of Shares Withdrawn
| |
* Unless otherwise indicated, it will be assumed that all Shares held in the Direct Registration System, including any Shares held in the Fund’s distribution reinvestment plan, are being withdrawn.
This Notice of Withdrawal is to be completed if you tendered Shares, of Eaton Vance Senior Income Trust, a Massachusetts business trust, in connection with its offer to purchase for cash up to 60% or 22,719,965 of its outstanding Shares and you wish to withdraw some or all of the Shares tendered.
Signatures are required on the next page.
NOTE: SIGNATURE(S) MUST BE PROVIDED BELOW.
PLEASE READ THE INSTRUCTIONS SET FORTH IN THIS
NOTICE OF WITHDRAWAL CAREFULLY.
| Signature(s) of Owner(s): | ||
| Date: | , 2021 | |
| Printed Names: | ||
| Capacity (full title): | ||
| Address: | ||
Exhibit (a)(5)(i)
Investor Contact: (800) 262-1122
FOR IMMEDIATE RELEASE
CERTAIN EATON VANCE CLOSED-END FUNDS
COMMENCE TENDER OFFERS
BOSTON, MA, June 29, 2021 — Eaton Vance Short Duration Diversified Income Fund (NYSE: EVG), Eaton Vance Floating-Rate Income Trust (NYSE: EFT), Eaton Vance Senior Floating-Rate Trust (NYSE: EFR) and Eaton Vance Senior Income Trust (NYSE: EVF) (each, a “Fund” and collectively, the “Funds”) each announced today the commencement of a cash tender offer for outstanding common shares (each, a “Tender Offer” and collectively, the “Tender Offers”) in the following amounts and as further described below.
| Fund | Tender Offer Amount |
| EVG | Up to 25% or 4,470,149 of its outstanding common shares |
| EFT | Up to 50% or 19,931,845 of its outstanding common shares |
| EFR | Up to 50% or 18,424,157 of its outstanding common shares |
| EVF | Up to 60% or 22,719,965 of its outstanding common shares |
Each Tender Offer will be conducted at a price per share equal to 99% of such Fund’s net asset value (“NAV”) per share as of the close of regular trading on the New York Stock Exchange (NYSE) on the date the Tender Offer expires. Each Tender Offer will expire at 5:00 P.M., Eastern Time on July 30, 2021 or on such later date to which the offer is extended. The pricing date will also be July 30, 2021, unless extended. If the number of shares tendered exceeds the maximum amount of a Tender Offer, the Fund will purchase shares from tendering shareholders on a pro-rata basis (disregarding fractional shares). Accordingly, there is no assurance that a Fund will purchase all of a shareholder's tendered common shares in connection with the relevant Tender Offer.
Each Fund may sell portfolio instruments during the pendency of its Tender Offer to raise cash for the purchase of common shares. Thus, it is likely that during the pendency of each Tender Offer, and possibly for a short time thereafter, each Fund will hold a greater than normal percentage of its net assets in cash and cash equivalents. This larger cash position may interfere with a Fund’s ability to meet its investment objectives and invest consistent with its investment strategy.
Each Tender Offer is being made on the terms and subject to the conditions set forth in the relevant Fund’s tender offer statement on Schedule TO (including an offer to purchase, a related letter of transmittal and other offer documents) that has been filed with the Securities and Exchange Commission (the “SEC”). All of these documents contain important information about the relevant Tender Offer. Shareholders of each Fund should read their documents carefully as they contain important information about the relevant Tender Offer. Shareholders of each Fund can obtain a free copy of the relevant documents at the SEC’s website at www.sec.gov or from the Fund by calling AST Fund Solutions, LLC, the Fund’s information agent for the tender offer, at 1-877-732-3614.
As previously announced, in addition to the above described Tender Offers, each of EFT, EFR and EVF will conduct cash tender offers by the end of the fourth quarter of each of 2022, 2023 and 2024 (each, a “Conditional Tender Offer”) for up to 10% of the Fund’s then-outstanding common shares if, from January to August of the relevant year, the Fund’s shares trade at an average discount to NAV of more than 10% (based upon the Fund’s volume-weighted average market price and NAV on business day during the period). If triggered, common shares tendered and accepted in a Conditional Tender Offer would be repurchased at a price per share equal to 98% of a Fund’s NAV as of the close of regular trading on the NYSE on the date such Conditional Tender Offer expires.
This press release is not a recommendation, an offer to purchase, or a solicitation of an offer to sell shares of the Funds and is not a prospectus, circular or representation intended for use in the purchase or sale of Fund shares.
About the Funds.
Eaton Vance applies in-depth fundamental analysis to the active management of equity, income, alternative and multi-asset strategies. Eaton Vance’s investment teams follow time-tested principles of investing that emphasize ongoing risk management, tax management (where applicable) and the pursuit of consistent long-term returns. The firm’s investment capabilities encompass the global capital markets. With a history dating back to 1924, Eaton Vance is headquartered in Boston and also maintains investment offices in New York, London, Tokyo and Singapore. For more information, visit evmanagement.com. Eaton Vance is a part of Morgan Stanley Investment Management, the asset management division of Morgan Stanley.
Except pursuant to a tender offer, common shares of the Funds are only available for purchase or sale on the NYSE exchange at their current market price. Shares of closed-end funds (such as the Funds) often trade at a discount from their net asset value. The market price of a fund’s shares may vary from net asset value based on factors affecting the supply and demand for shares, such as fund distribution rates relative to similar investments, investors’ expectations for future distribution changes, the clarity of a fund’s investment strategy
and future return expectations, and investors’ confidence in the underlying markets in which the fund invests. Fund shares are subject to investment risk, including possible loss of principal invested. Shares of the Funds are not FDIC-insured and are not deposits or other obligations of, or guaranteed by, any bank. Each Fund is not a complete investment program and you may lose money investing in the Fund. An investment in a Fund may not be appropriate for all investors. Before investing, prospective investors should consider carefully such Fund’s investment objectives, risks, charges and expenses.
This announcement is not a recommendation, an offer to purchase or a solicitation of an offer to sell shares of the Funds. The Funds have not commenced the Tender Offers described in this release. The Tender Offers will be made only by the respective offers to purchase, related letters of transmittal and other documents filed with the U.S. Securities and Exchange Commission (“SEC”) as exhibits to the tender offer statements on Schedule TO, with all such documents available on the SEC’s website at www.sec.gov. For each Tender Offer, the Funds will also make available to shareholders without charge the offer to purchase and the letter of transmittal. Shareholders should read these documents carefully, as they will contain important information about the Tender Offers.
This press release is for informational purposes only and is not intended to, and does not, constitute an offer to purchase or sell shares of a Fund. Additional information about the Funds, including performance and portfolio characteristic information, is available at www.eatonvance.com.
Statements in this press release that are not historical facts may be forward-looking statements, as defined by the U.S. securities laws. You should exercise caution in interpreting and relying on forward-looking statements because they are subject to uncertainties and other factors that may be beyond a Fund’s control and could cause actual results to differ materially from those set forth in the forward-looking statements.
###
Exhibit (b)(i)
FORM OF AMENDED AND RESTATED REVOLVING CREDIT AND SECURITY AGREEMENT
among
EATON VANCE SENIOR INCOME TRUST,
as Borrower
CHARTA, LLC,
CAFCO, LLC,
CIESCO, LLC,
CRC FUNDING, LLC,
as Conduit Lenders
CITIBANK, N.A.,
as Secondary Lender
and
CITIBANK, N.A.,
as Agent
Dated as of ___________
PLEASE NOTE THAT THIS IS A CONFORMED VERSION OF THE REVOLVING CREDIT AND SECURITY AGREEMENT THAT HAS BEEN REVISED TO REFLECT THE AMENDMENTS REFERENCED ABOVE. THIS CONFORMED CREDIT AGREEMENT IS FOR REFERENCE PURPOSES ONLY AND IS NOT INTENDED TO REPLACE THE EXECUTED VERSIONS OF THE ABOVE-REFERENCED DOCUMENTS
TABLE OF CONTENTS
Article I
DEFINITIONS AND RULES OF CONSTRUCTION
| SECTION 1.01. Definitions. | 1 |
| SECTION 1.02. Rules of Construction. | 27 |
|
SECTION 1.03. Computation of Time Periods.
|
28 |
Article II
ADVANCES TO THE BORROWER
| SECTION 2.01. Advance Facility. | 28 |
| SECTION 2.02. Making of Advances. | 28 |
| SECTION 2.03. Noteless Agreement; Evidence of Indebtedness. | 29 |
| SECTION 2.04. Maturity of the Advances. | 30 |
| SECTION 2.05. Prepayment of the Advances. | 30 |
| SECTION 2.06. Conversions; Continuations. | 32 |
| SECTION 2.07. Yield. | 33 |
| SECTION 2.08. Increased Costs. | 33 |
| SECTION 2.09. Compensation. | 36 |
| SECTION 2.10. Additional Yield on Eurodollar Rate Advances. | 36 |
| SECTION 2.11. Termination or Reduction of the Total Commitment. | 36 |
| SECTION 2.12. Rescission or Return of Payment. | 37 |
| SECTION 2.13. Fees Payable by Borrower. | 37 |
| SECTION 2.14. Post Default Interest. | 37 |
| SECTION 2.15. Payments. | 37 |
| SECTION 2.16. Ratable Payments. | 38 |
| SECTION 2.17. Borrower’s Obligations Absolute. | 38 |
| SECTION 2.18. Right of Set-off. | 38 |
| SECTION 2.19. Non-Receipt of Funds by the Agent. | 39 |
|
SECTION 2.20. Effect of Benchmark Replacement Event.
|
40 |
Article III
CONDITIONS PRECEDENT
| SECTION 3.01. [INTENTIONALLY OMITTED] | 43 |
| SECTION 3.02. Conditions Precedent to All Advances. | 43 |
|
SECTION 3.03. Conditions Precedent to the Effectiveness of this Agreement on the Restatement Effective Date.
|
44 |
Article IV
REPRESENTATIONS AND WARRANTIES
| SECTION 4.01. Representations and Warranties of the Borrower. | 46 |
| i |
Article V
COVENANTS
| SECTION 5.01. Affirmative Covenants of the Borrower. | 50 |
|
SECTION 5.02. Negative Covenants of the Borrower.
|
55 |
Article VI
EVENTS OF DEFAULT
| SECTION 6.01. Events of Default. | 58 |
Article VII
PLEDGE OF PLEDGED COLLATERAL; RIGHTS OF THE AGENT
| SECTION 7.01. Security Interests. | 62 |
| SECTION 7.02. Substitution of Collateral and Release of Security Interest. | 63 |
| SECTION 7.03. Application of Proceeds. | 63 |
| SECTION 7.04. Rights and Remedies upon Event of Default. | 64 |
|
SECTION 7.05. Remedies Cumulative.
|
65 |
Article VIII
THE AGENT
| SECTION 8.01. Authorization and Action. | 66 |
| SECTION 8.02. Delegation of Duties. | 66 |
| SECTION 8.03. Agent's Reliance, Etc. | 66 |
| SECTION 8.04. Indemnification. | 67 |
| SECTION 8.05. Successor Agent. | 68 |
| SECTION 8.06. Delegation of Duties. | 68 |
|
SECTION 8.07. Non-Reliance on Agent and Other Lenders.
|
68 |
Article IX
MISCELLANEOUS
| SECTION 9.01. No Waiver; Modifications in Writing. | 69 |
| SECTION 9.02. Notices, Etc. | 69 |
| SECTION 9.03. Taxes. | 71 |
| SECTION 9.04. Costs and Expenses; Indemnification. | 72 |
| SECTION 9.05. Execution in Counterparts. | 74 |
| SECTION 9.06. Assignability. | 74 |
| SECTION 9.07. Governing Law. | 75 |
| SECTION 9.08. Severability of Provisions. | 76 |
| SECTION 9.09. Confidentiality. | 76 |
| SECTION 9.10. Merger. | 78 |
| SECTION 9.11. No Proceedings; No Recourse. | 78 |
| SECTION 9.12. Survival of Representations and Warranties. | 78 |
| SECTION 9.13. Loan Documents. | 78 |
| ii |
| SECTION 9.14. Submission to Jurisdiction; Waivers; Etc. | 79 |
| SECTION 9.15. E-Mail Reports. | 80 |
| SECTION 9.16. Waiver of Jury Trial. | 80 |
| SECTION 9.17. Several Obligations. | 80 |
| SECTION 9.18. Limitation on Liability. | 81 |
| SECTION 9.19. Patriot Act Notice. | 81 |
| SECTION 9.20. Certain ERISA Matters. | 81 |
SCHEDULES
| Schedule I | Form of Investor Report |
| Schedule II | Location of Loan Documents |
| Schedule III | Industry Classifications |
| Schedule IV | Trustee Information |
| Schedule 4.01(J) | Pending Litigation or Other Proceedings |
| Schedule V | List of Advance Rates |
EXHIBITS
| EXHIBIT A | Form of Advance Note |
| EXHIBIT B | Form of Notice of Borrowing |
| EXHIBIT C | Form of Assignment and Acceptance |
| EXHIBIT D | Form of Notice of Prepayment |
| EXHIBIT E | Form of Notice of Conversion or Continuation |
| iii |
FORM OF
AMENDED AND RESTATED REVOLVING CREDIT
AND SECURITY AGREEMENT
AMENDED AND RESTATED REVOLVING CREDIT AND SECURITY AGREEMENT, dated as of ________ among CHARTA, LLC, CAFCO, LLC, CIESCO, LLC and CRC FUNDING, LLC, as Conduit Lenders, CITIBANK, N.A. and the other Secondary Lenders (as hereinafter defined) from time to time parties hereto, CITIBANK, N.A., as agent for the Secured Parties (as hereinafter defined) (in such capacity, together with its successors and assigns, the "Agent") and EATON VANCE SENIOR INCOME TRUST (together with its permitted successors and assigns, the "Borrower"), to amend and restate the Revolving Credit and Security Agreement entered into as of _________, among the Borrower, the Conduit Lenders party thereto, the Secondary Lenders party thereto and the Agent (as amended, supplemented or otherwise modified prior to the Restatement Effective Date, the "Existing Credit Agreement"), and, from and after the Restatement Effective Date, the Existing Credit Agreement is hereby amended and restated in its entirety.
W I T N E S S E T H:
WHEREAS, the Borrower desires that the Conduit Lenders (as hereinafter defined) and the Secondary Lenders from time to time make Advances to the Borrower on the terms and subject to the conditions set forth in this Agreement; and
WHEREAS, the Conduit Lenders and the Secondary Lenders are willing to make such Advances to the Borrower for such purposes on the terms and subject to the conditions set forth in this Agreement;
NOW, THEREFORE, in consideration of the premises and of the mutual covenants herein contained, the parties hereto agree as follows:
Article
I
DEFINITIONS AND RULES OF CONSTRUCTION
SECTION 1.01. Definitions.
As used in this Agreement, the following terms shall have the meanings indicated:
"Accounting Based Consolidation Event" means the consolidation, for financial and/or regulatory accounting purposes, of all or any portion of the assets and liabilities of a Conduit Lender that are the subject of this Agreement, the Asset Purchase Agreement or any other Program Document with all or any portion of the assets and liabilities of Citibank or the Agent or any of their affiliates as the result of the existence of, or occurrence of any change in, accounting standards or the issuance of any pronouncement, interpretation (including any change in interpretation by independent accountants or regulators with direct application to financial statements of regulatory financial reports of Citibank, the Agent or any of their Affiliates) or release, by any accounting body or any other body charged with the promulgation or administration of accounting standards, including, without limitation, the Financial Accounting Standards Board, the International Accounting Standards Board, the American Institute of Certified Public Accountants, the Federal Reserve Board of Governors and the Securities and Exchange Commission, and shall occur as of the date that such consolidation (i) shall have occurred with respect to the financial statements of Citibank or the Agent or any of their affiliates or (ii) shall have been required to have occurred, regardless of whether such financial statements were prepared as of such date.
“Acquisition” means the merger of Eaton Vance Corp., of which the Adviser is an indirect, wholly-owned subsidiary, with and into one or more wholly owned subsidiaries of Morgan Stanley, substantially as described in that certain Agreement and Plan of Merger dated as of October 7, 2020 by and among Morgan Stanley, Mirror Merger Sub 1, Inc., Mirror Merger Sub 2, LLC and Eaton Vance Corp. (as it may be amended from time to time).
“Acquisition Closing Date” means the date, if any, that the Acquisition becomes effective.
"Adjusted Asset Value" means in respect of any Borrowing Base Eligible Asset an amount equal to the product of (i) the Asset Value of such Borrowing Base Eligible Asset, and (ii) the applicable Advance Rate for such Borrowing Base Eligible Asset.
"Advance" means each advance by a Conduit Lender or a Secondary Lender to the Borrower on a Borrowing Date pursuant to Article II, provided, that if any Conduit Lender assigns a portion of any Advance made by it to a Lender pursuant to an Asset Purchase Agreement or otherwise or any Secondary Lender assigns a portion of any outstanding Advance made by it pursuant to an Assignment and Acceptance, the portion of such Advance retained by such Conduit Lender or Secondary Lender, as the case may be, and the portion of such Advance acquired by such assignee shall each be deemed to constitute a separate Advance for purposes of this Agreement.
"Advance Note" means each promissory note, if any, issued by the Borrower to a Conduit Lender or a Secondary Lender in accordance with the provisions of Section 2.03(d), substantially in the form of Exhibit A hereto, as the same may from time to time be amended, supplemented, waived or modified.
"Advance Rate" means in respect of any Asset, the percentage corresponding to such Asset or the ratings category for such Asset set forth on Schedule V hereto.
"Adverse Claim" means any Lien or other right, claim, encumbrance or any other type of preferential arrangement in, of or on any Person’s assets or properties in favor of any other Person, other than in the case of the Borrower, Permitted Liens.
"Adviser" means Eaton Vance Management, an indirect subsidiary of Morgan Stanley, together with its permitted successors and assigns.
“Advisory Agreement” means the Investment Advisory Agreement, dated as of the date of certification of shareholder approval thereof following the Acquisition Closing Date, between the Adviser and the Borrower, as the same may be amended, supplemented, waived or modified as permitted under this Agreement.
“Affected Financial Institution” means (a) any EEA Financial Institution or (b) any UK Financial Institution.
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"Affected Person" means each Lender, each Secondary Lender, any other entity which enters into a commitment to make or purchase any Advance or any interest therein, or to provide any liquidity or credit enhancement to a Conduit Lender, and any of their respective Affiliates, including any permitted assignee or participant of any Lender or any Secondary Lender.
"Affiliate" means, in respect of a referenced Person, (a) another Person controlling, controlled by or under common control with such referenced Person (which in the case of the Conduit Lenders and the Agent shall also include any entity which is a special purpose entity that issues promissory notes and has a relationship to the Agent comparable to that of the Conduit Lenders) or (b) any officer (exclusive of a "ministerial officer" with no authority to bind a Person), director of or partner in the referenced Person. The terms "control," "controlling," "controlled" and the like mean the direct or indirect possession of the power to direct or cause the direction of the management or policies of a Person or the disposition of its assets or properties, whether through ownership, by contract, arrangement or understanding, or otherwise.
"Agent" shall have the meaning assigned to such term in the introduction to this Agreement.
"Agent's Account" means the special account () of the Agent maintained at the office of Citibank, N.A. at its Principal Office or to such other account as the Agent shall designate in writing to the Borrower.
"Aggregate Custodian’s Advance Amount" means the sum of (i) the aggregate unpaid Dollar amount of all outstanding Custodian’s Overdraft Advances of cash, (ii) the aggregate Asset Value of all Custodian’s Overdraft Advances of securities to the extent not reimbursed by the Borrower, and (iii) the accrued and unpaid interest, if any, on the amounts set forth above.
"Agreement" means this Agreement, as the same may from time to time be amended, supplemented, waived or modified.
"Alternate Base Rate" means a fluctuating interest rate per annum as shall be in effect from time to time, which rate shall be at all times equal to the sum of the Applicable Margin plus the Base Rate for such Advance.
"Alternate Base Rate Advance" means an Advance, the Yield on which is computed with reference to the Alternate Base Rate.
"Applicable Law" means any Law of any Authority, including, without limitation, all Federal and state banking or securities laws, to which the Person in question is subject or by which it or any of its property is bound.
"Applicable Margin" means, with respect to the Eurodollar Rate, % per annum and with respect to the Alternate Base Rate, % per annum; provided, however, that during the continuance of any Event of Default, the "Applicable Margin" shall mean with respect to the Eurodollar Rate, % per annum and with respect to the Alternate Base Rate, % per annum. For the avoidance of doubt, during any period that Yield in respect of any Advance is computed by reference to the Post-Default Rate, the “Applicable Margin” applicable to such Advance during such period shall be deemed to be.
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"Approved Pricing Service" means, in respect of any Borrowing Base Eligible Asset, any of the following pricing services: Bloomberg, Bridge Information Services, Data Resources Inc., Interactive Data Services, International Securities Market Association, Merrill Lynch Securities Pricing Service, Muller Data Corp., Thomson Reuters Pricing Service, Telerate, Markit Partners or Pricing Direct.
"ARPS Mandatory Redemption" means any redemption by the Borrower of any outstanding Auction Preferred Shares required pursuant to the terms and conditions set forth in Article VII, paragraph 3 of the By-laws.
"ARPS Retirement" means the full redemption or repurchase of all outstanding Auction Preferred Shares by the Borrower.
"Asset Coverage Test" means, as of any Business Day, the Borrower's "senior securities representing indebtedness" (as defined in Section 18(g) of the Investment Company Act) have "asset coverage" (as defined in Section 18(h) of the Investment Company Act) of at least % (or such higher percentage as may be set forth in Section 18(h) of the Investment Company Act), computed on each Business Day regardless of whether or not dividends or distributions are being made on such day, or whether Debt is being incurred on such day and computed as if each outstanding Advance constituted a "senior security" without regard to whether such Advance is a loan for "temporary purposes" or otherwise excludable from the definition of "senior securities" under Section 18(g) of the Investment Company Act.
"Asset Purchase Agreement" means the Asset Purchase Agreement entered into by the Conduit Lenders and a Secondary Lender (other than Citibank) concurrently with an Assignment and Acceptance or any similar arrangement in respect of Citibank.
"Assets" means a collective reference to all items which would be classified as an "asset" on the balance sheet of the Borrower in accordance with GAAP.
"Asset Value" means, as of any day of determination (a) in respect of Cash, the amount of such Cash, (b) in respect of any Loan Asset, the lower of (i) the value of such Loan Asset provided by an Approved Pricing Service, and (ii) the Value of such Loan Asset determined by the Borrower based upon the Matrix Price of such Loan Asset or such other Value as is determined by the Borrower in a manner which is in accordance with the Prospectus of the Borrower in effect on the Restatement Effective Date and in accordance with Applicable Law, including without limitation the rules, regulations and interpretations of the SEC under the Investment Company Act, (c) in respect of any Asset which is listed or traded on NYSE, NYSE MKT LLC or NASDAQ, the Value of such Asset computed in the manner as such Value is required to be computed by the Borrower in accordance with the Prospectus of the Borrower in effect on the Restatement Effective Date and in accordance with Applicable Law, including without limitation the rules, regulations and interpretations of the SEC under the Investment Company Act, and (d) in respect of any other Asset, the lower of (i) the value of such Asset provided by an Approved Pricing Service, and (ii) the Value of such Asset computed in the manner as such Value is required to be computed by the Borrower in accordance with the Prospectus of the Borrower in effect on the Restatement Effective Date and in accordance with Applicable Law, including without limitation the rules, regulations and interpretations of the SEC under the Investment Company Act; provided, that the Asset Value of any Asset shall be net of the Borrower's liabilities relating thereto, including without limitation all of the Borrower’s obligations to pay any unpaid portion of the purchase price therefor; provided, further, that the Asset Value of any Borrowing Base Eligible Asset shall be if the Value of such Asset is not determined as expressly set forth above.
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"Assignee Rate" means in respect of any Advance for any Settlement Period an interest rate per annum equal to the sum of the Applicable Margin plus the Eurodollar Rate for such Settlement Period; provided, however, that in case of:
(i) any Settlement Period on or prior to the first day of which a Lender (other than the Conduit Lenders) or Secondary Lender shall have notified the Agent that the introduction of or any change in or in the interpretation of any law or regulation makes it unlawful, or any central bank or other governmental authority asserts that it is unlawful, for such Lender or Secondary Lender to fund such Advance at the Assignee Rate set forth above (and such Lender or such Secondary Lender shall not have subsequently notified the Agent that such circumstances no longer exist);
(ii) any Settlement Period of one to (and including) 27 days;
(iii) any Settlement Period as to which the Agent does not receive notice, by no later than 12:00 noon (New York City time) on the second Business Day preceding the first day of such Settlement Period, that such Advance will not be funded by issuance of commercial paper; or
(iv) any Settlement Period for which the aggregate principal amount of the outstanding Advances is less than $;
the "Assignee Rate" for such Settlement Period shall be an interest rate per annum equal to the Alternate Base Rate in effect on the first day of such Settlement Period.
"Assignment and Acceptance" means the Assignment and Acceptance, in substantially the form of Exhibit C hereto, entered into by a Secondary Lender, an Eligible Assignee, the Agent and, if applicable, the Borrower, pursuant to which such Eligible Assignee became a party to this Agreement.
"Auction Preferred Shares" means any series of preferred shares which are issued by the Borrower pursuant to Section 5.5 of Article V of the Declaration of Trust and Article VII of the By-laws, and for which the per annum rate of cash dividends payable to holders of such shares are determined periodically pursuant to the auction procedures set forth in Part II of Article VII of the By-laws.
"Australian Dollars" means the lawful currency of Australia.
"Authority" means any governmental or quasi-governmental authority (including the National Association of Securities Dealers, the stock exchanges and the SEC), whether executive, legislative, judicial, administrative or other, or any combination thereof, including, without limitation, any Federal, state, territorial, county, municipal or other government or governmental or quasi-governmental agency, arbitrator, board, body, branch, bureau, commission, corporation, court, department, instrumentality, master, mediator, panel, referee, system or other political unit or subdivision or other entity of any of the foregoing, whether domestic or foreign.
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“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable Resolution Authority in respect of any liability of an Affected Financial Institution.
“Bail-In Legislation” means (a) with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law, regulation rule or requirement for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule and (b) with respect to the United Kingdom, Part I of the United Kingdom Banking Act 2009 (as amended from time to time) and any other law, regulation or rule applicable in the United Kingdom relating to the resolution of unsound or failing banks, investment firms or other financial institutions or their affiliates (other than through liquidation, administration or other insolvency proceedings).
"Base Rate" means the rate of interest from time to time announced publicly by Citibank at its Principal Office as its base rate. The Base Rate is a reference rate and does not necessarily represent the lowest or best rate actually charged to any customer of Citibank. Notwithstanding the foregoing, the Base Rate shall not be less than %.
"Basel III" means the global regulatory standards on bank capital adequacy and liquidity referred to by the Basel Committee on Banking Regulations and Supervisory Practices as "Basel III" or the "Basel III Framework" published in December 2010 together with any further guidance or standards in relation to "Basel III" or the "Basel III Framework" published or to be published by the Basel Committee on Banking Regulations and Supervisory Practices.
"Benefit Arrangement" means an employee benefit plan within the meaning of Section 3(3) of ERISA which is subject to the provisions of Title I of ERISA and is not a Plan or a Multiemployer Plan.
“Benefit Plan” means any of (a) an “employee benefit plan” (as defined in ERISA) that is subject to Title I of ERISA, (b) a “plan” as defined in Section 4975 of the Code or (c) any Person whose assets include (for purposes of ERISA Section 3(42) or otherwise for purposes of Title I of ERISA or Section 4975 of the Code) the assets of any such “employee benefit plan” or “plan”.
"Borrower" shall have the meaning assigned to such term in the introduction to this Agreement.
"Borrower Obligations" means all indebtedness, whether absolute, fixed or contingent, at any time or from time to time owing by the Borrower or the Adviser to any Secured Party under or in connection with this Agreement, the Advance Notes, the Letter Agreement, the Control Agreement, the Fee Letter or any other Program Document, including without limitation, all amounts payable by the Borrower in respect of the Advances, with interest thereon, and the amounts payable under Sections 2.05, 2.07, 2.08, 2.09, 2.10, 2.12, 2.13, 2.14,1 7.04(b), 9.03 and 9.04 of this Agreement.
"Borrower's Account" means DDA Account Number 00421339, ABA No. 011-000-028, maintained with the Custodian, or such other account as the Borrower shall from time to time designate in writing to the Agent.
1 Amendment No. 1
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"Borrowing Base" means on the date any determination thereof is made, an amount equal to (i) the aggregate Adjusted Asset Value of all Eligible Collateral as of such date of determination in which the Agent has a valid and perfected first priority security interest free and clear of Adverse Claims, minus (ii) the Borrowing Base Excess Amount as of such date of determination.
"Borrowing Base Determination Date" shall have the meaning assigned to such term in Section 2.05(b).
"Borrowing Base Eligible Asset" means Cash maintained in the Collateral Account, any Eligible Debt Security, any Eligible Equity Security, any Eligible Commercial Paper, any Eligible Money Market Investment, and any Eligible Government Security which the Borrower is permitted to purchase in accordance with the Investment Policies and Restrictions which are free and clear of all Adverse Claims; provided, that such Asset does not constitute (i) a Derivatives Transaction, an Equity Security (other than Eligible Equity Securities), any Convertible Securities, a Distressed Asset, an Unrated Asset, a Non-OECD Asset, a Citigroup Asset or an Illiquid Asset, (ii) an Asset which is the subject of a reverse repurchase agreement, dollar roll, securities lending transaction or other Derivatives Transaction (other than Derivatives Transactions entered into solely to protect against interest rate risk which have not been entered into for speculative purposes), including, without limitation, any cash or other Asset maintained in a segregated account with the Custodian relating to any outstanding reverse repurchase agreement entered into by the Borrower or any Asset which is pledged for margin requirements on options and derivatives transactions or dollar rolls or securities lending transactions, (iii) an Asset that is committed to a repurchase of shares pursuant to Rule 23c-3(b)(9) under the Investment Company Act, (iv) an Asset held by a sub-custodian of the Custodian which is not located in the United States, or (v) an Asset the obligor of which (a) is, or is owned or controlled by, a Sanctioned Person; (b) is located, incorporated, organized, or resident in a Sanctioned Country; (c) has any business affiliation or commercial dealings with, or investments in, any Sanctioned Country or Sanctioned Person in a manner that would violate any Sanction; or (d) is the subject of any formal governmental action, proceeding or investigation under any Sanctions Laws or any applicable anti-money laundering laws.
"Borrowing Base Excess Amount"
"Borrowing Base Test" means as of any date of determination that the Borrowing Base shall be equal to or greater than Credits Outstanding.
"Borrowing Date" shall have the meaning assigned to such term in Section 2.02.
"Borrowing Limit" shall have the meaning assigned to such term in Section 2.05(c).
"Business Day" means any day on which (i) banks are not authorized or required to close in New York, New York and the NYSE is not authorized or required to close, and (ii) if this definition of "Business Day" is utilized in connection with a Eurodollar Rate Advance, dealings are carried out in the London interbank market.
"By-laws" means the duly adopted by-laws of the Borrower dated as of September 23, 1998, as the same may be amended, restated, supplemented, waived or modified from time to time.
"CAFCO" means CAFCO, LLC.
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"Canadian Dollars" means the lawful currency of Canada.
"Cash" means United States Dollars immediately available on the day in question in an account maintained by the Custodian.
"CHARTA" means CHARTA, LLC.
"CIESCO" means CIESCO, LLC.
"Citibank" means Citibank, N.A. and its successors.
"Citigroup Asset" means an Asset for which Citigroup Inc. or any Affiliate of Citigroup Inc. is the issuer or guarantor.
"Class A Corporate Bond Assets" means, as of any date of determination, all Borrowing Base Eligible Assets which are Eligible Corporate Bond Assets and which are related to corporate bond obligations which obligations are rated as of such date of determination no less than "BBB-" from S&P and "Baa3" from Moody’s, or which, if rated only by S&P or Moody’s, shall be rated no less than "BBB-" from S&P or "Baa3" from Moody’s.
"Class A Loan Asset" means as of any date of determination, a Borrowing Base Eligible Asset which (i) is an Eligible Loan Asset, (ii) is not a Distressed Asset, and (iii) has an Asset Value which is at least percent (%) of its par value as of such date of determination.
"Class B Corporate Bond Assets" means, as of any date of determination, all Borrowing Base Eligible Assets which are Eligible Corporate Bond Assets and which are related to corporate bond obligations (i) that are not Class A Corporate Bond Assets and (ii) which obligations are rated as of such date of determination no less than "BB-" from S&P and "Ba3" from Moody’s, or which, if rated only by S&P or Moody’s, shall be rated no less than "BB-" from S&P or "Ba3" from Moody’s.
"Class B Loan Asset" means as of any date of determination, a Borrowing Base Eligible Asset which (i) is an Eligible Loan Asset, (ii) is not a Distressed Asset, and (iii) has an Asset Value which is less than percent (%) of its par value but greater than or equal to percent (%) of its par value as of such date of determination.
"Class C Corporate Bond Assets" means, as of any date of determination, all Borrowing Base Eligible Assets which are Eligible Corporate Bond Assets and which are related to corporate bond obligations (i) that are not Class A Corporate Bond Assets or Class B Corporate Bond Assets and (ii) which obligations are rated as of such date of determination no less than "B-" from S&P and "B3" from Moody’s, or which, if rated only by S&P or Moody’s, shall be rated no less than “B-” from S&P or “B3” from Moody’s.
"Closing Date" means November 9, 1998.
"Code" means the Internal Revenue Code of 1986, as amended from time to time, or any successor statute.
"Collateral Account" shall have the meaning assigned to such term in the Control Agreement.
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"Compliance Certification Date" shall have the meaning assigned to such term in Section 2.05(b).2
"Conduit Lender" means each of CHARTA, LLC, CAFCO, LLC, CIESCO, LLC, and CRC Funding, LLC, together with their permitted successors and assigns that constitute special purpose entities that issue commercial paper notes or other debt securities.
"Control Agreement" means (i) for the period prior to the date hereof, the Control and Disbursement Agreement, dated as of November 9, 1998, among the Borrower, the Agent and the Custodian, as amended, supplemented, waived or modified on or prior to the date hereof, and (ii) for the period from and after the date hereof, the Control and Collateral Agency Agreement, dated as of the date hereof, among the Borrower, the Agent and the Custodian, as the same may from time to time be amended, supplemented, waived or modified.
"Convertible Security" means any Asset which is convertible or exchangeable into an Equity Security.
"CP Rate" for each day during a Settlement Period for any Advance means to the extent a Conduit Lender funds such Advance on such day by issuing commercial paper notes, the per annum rate equivalent to the weighted average of the per annum rates paid or payable by such Conduit Lender from time to time as interest on or otherwise (by means of interest rate hedges or otherwise) in respect of those commercial paper notes issued by such Conduit Lender that are allocated, in whole or in part, by the Agent (on behalf of such Conduit Lender) to fund the making or maintenance of such Advance on such day during such Settlement Period as determined by the Agent (on behalf of such Conduit Lender) and reported to the Borrower, which rates shall reflect and give effect to the commissions of placement agents and dealers in respect of such commercial paper notes, to the extent such commissions are allocated, in whole or in part, to such commercial paper notes by the Agent on behalf of such Conduit Lender; provided, however, that if any component of such rate is a discount rate, in calculating the "CP Rate" for such day, the Agent shall for such component use the rate resulting from converting such discount rate to an interest bearing equivalent rate per annum; provided, further, that for each day during the continuance of any Event of Default the "CP Rate" shall mean the CP Rate as computed above plus % per annum; provided, further, that for any period that Yield in respect of any Advance is computed by reference to the Post-Default Rate, the "CP Rate" in respect of such Advance for such period shall be deemed to be . Notwithstanding the foregoing, the CP Rate shall not be less than %.
"CRC" means CRC Funding, LLC.
"Credits Outstanding" means at any time a determination thereof is made, an amount equal to the sum of (i) the outstanding principal amount of all Advances, plus (ii) any unpaid and past due Yield accrued on the outstanding advances and unpaid fees due under the Fee Letter, plus (iii) the Yield that would accrue on the outstanding principal amount of the Advances through the sixty (60) day period following such date of determination, computed by reference to the Assignee Rate based upon the Eurodollar Rate for a thirty (30) day period in effect as of the time of determination, plus (iv) all fees that would accrue under the Fee Letter through the sixty (60) day period following such date of computation, computed as if the outstanding principal amount of the Advances on each day during such period was equal to the Total Commitment, plus (v) the Aggregate Custodian's Advance Amount, plus (vi) the amount of any judgment or the amount of any taxes that give rise to a Permitted Lien on any Assets of the Borrower.
2 Amendment No. 1
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"Custodial Agreement" means the Amended and Restated Master Custodial Agreement between the Custodian and the Borrower dated as of September 1, 2013, as the same may from time to time be amended, supplemented, waived or modified as permitted under the Program Documents.
"Custodian" means State Street Bank and Trust Company (as successor to Investors Bank & Trust Company), as custodian under the Custodial Agreement and as securities intermediary and collateral agent under the Control Agreement, and its permitted successors and assigns.
"Custodian’s Overdraft Advances" means any advance of cash, assets or securities by the Custodian pursuant to or in connection with the Custodial Agreement.
"Debt" means with respect to any Person, at any date, without duplication, (i) all "senior securities representing indebtedness" (as defined in Section 18(g) of the Investment Company Act), (ii) all obligations of such Person for borrowed money, including without limitation, all obligations of such Person which are evidenced by letters of credit or letter of credit reimbursement, (iii) all obligations of such Person evidenced by bonds, debentures, notes, acceptances or other similar instruments, (iv) all obligations of such Person to pay the deferred purchase price of property or services, (v) all obligations of such Person as lessee which are capitalized in accordance with GAAP, (vi) all Debt of others secured by a Lien on any asset of such Person, whether or not such Debt is assumed by such Person, (vii) payment obligations, fixed or contingent, under investment, financial derivative or similar contracts (other than covered short sales), (viii) all Debt of others Guaranteed by such Person, and (ix) to the extent not otherwise included, all items which in accordance with GAAP would be included in determining total liabilities as shown on the liabilities side of such Person’s balance sheet.
"Declaration of Trust" means the Agreement and Declaration of Trust of the Borrower dated as of September 23, 1998, made by the initial Trustee thereunder, as amended, restated, supplemented, waived or modified from time to time.
"Default" means any event which, with the passage of time, the giving of notice, or both, would constitute an Event of Default.
"Derivatives Transaction" means any financial futures contract, option, forward contract, warrant, swap, swaption, collar, floor, cap and other agreement, instrument and derivative and other transactions of a similar nature (whether currency linked, index linked, insurance risk linked, credit risk linked or otherwise).
"Determination Date" shall have the meaning assigned to such term in Section 2.05(c).
"Distressed Asset" means an Asset (i) which is, or the Obligor of which, is the subject of a bankruptcy, insolvency, liquidation or other similar proceedings, (ii) which is in default beyond the applicable notice and cure periods, if any, as to payment of principal or interest or otherwise, including, without limitation, any “event of default”, under the instruments or agreements under which they were issued or otherwise evidenced, including the applicable Loan Documents with respect to a Loan Asset; provided, however, that if such Asset is in default for a period of time equal to or greater than thirty (30) consecutive days, such Asset shall be
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deemed to constitute a Distressed Asset regardless of whether or not the applicable grace period in respect of such Asset has expired, (iii) which is otherwise classified by the Adviser or the Borrower as a "Distressed Asset", (iv) which is rated "Caa1" or lower by Moody's or "CCC+" or lower by S&P, or (v) which has an Asset Value which is less than percent (%) of its par value.
"Dodd-Frank Act" means the Dodd-Frank Wall Street Reform and Consumer Protection Act.
"Dollars" and "$" mean lawful money of the United States of America.
“EEA Financial Institution” means (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.
“EEA Member Country” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.
“EEA Resolution Authority” means any public administrative authority or any person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.
"Eligible Assignee" means Citibank, any of its Affiliates, any Person managed by Citibank or any of its Affiliates, or any financial or other institution acceptable to the Agent.
"Eligible Collateral" means at any time the Pledged Collateral which constitutes Borrowing Base Eligible Assets.
"Eligible Commercial Paper" means a promissory note issued in the United States commercial paper market by an obligor having its principal office in the United States, having a maturity of not more than 270 days and which (i) if rated by both S&P and Moody's is rated at least "A-1" by S&P and at least "P-1" by Moody's, and (ii) if rated by S&P or Moody's (but not both) is rated at least "A-1" by S&P or at least "P-1" by Moody's.
"Eligible Corporate Bond Asset" at any time means any Asset that is a direct interest in a corporate bond obligation (i) which is part of an issuance of corporate debt with an aggregate outstanding principal amount on the original issuance date of such Asset which is at least equal to $; and (ii) which has a scheduled final maturity date no later than the thirtieth (30th) anniversary after the related original issuance date.
"Eligible Debt Securities" means Eligible Loan Assets and Eligible Corporate Bond Assets.
"Eligible Equity Security" means (a) an Equity Security (other than Preferred Stock) (i) which is listed on the NYSE, NYSE MKT LLC or NASDAQ, (ii) which has a per share trading price of at least $, and (iii) which was issued by an issuer having an equity market capitalization of at least $, and (b) any Preferred Stock (i) which is issued by a United States issuer meeting the criteria set forth in clause (a) above and (ii) the terms of such Preferred Stock provide for the periodic payment of dividends thereon in Dollars.
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"Eligible Foreign Currency" means Euros, Sterling, Canadian Dollars, Swiss Francs and Australian Dollars.
"Eligible Government Securities" means all "Government Securities" (as defined in the Investment Company Act and which for the purposes hereof shall include any securities issued or guaranteed as to principal and interest by an agency of the government of the United States) held in an account maintained by the Custodian, which mature in five (5) years or less from the date of issuance thereof.
"Eligible Loan Asset" at any time means a Loan Asset:
(i) which is a first lien syndicated senior secured floating rate loan with respect to which the interest payable on the principal amount thereof by the related Obligor is payable in cash;
(ii) in respect of which the Borrower’s interest is not a subparticipation;
(iii) which has a scheduled final maturity date no later than the eighth (8th) anniversary after the related Origination Date;
(iv) which is part of a syndicated credit facility where the sum of the aggregate revolving loan commitment amount plus the aggregate outstanding principal amount of all term loans under such facility on the Origination Date of such Loan Asset is at least equal to $;
(v) which relates to Loan Documents in which the Borrower’s interest (direct or participating) in the aggregate outstanding principal amount of all loans thereunder is no greater than percent (%);
(vi) in respect of which the related Loan Documents are not subject to any confidentiality arrangement which would preclude the Agent from reviewing such Loan Documents;
(vii) in which the Borrower’s interest in all collateral security therefor and principal and interest payments thereunder is no less than pro rata and pari passu with all other lenders thereunder or participants therein, as the case may be;
(viii) in respect of which the credit rating of the related Transaction Agent or its controlling Affiliate is no less than "A-" from S&P or "A3" from Moody's;
(ix) in respect of which, if the Borrower's interest therein is that of a participant, the credit rating of the related Selling Institution is no less than "A-" from S&P and "A3" from Moody's;
(x) the pledge of which under Article VII of this Agreement, would not conflict with or constitute a default under or be prohibited by any anti-assignment or other provisions contained in the related Loan Documents, except for anti-assignment provisions rendered ineffective by applicable law;
(xi) which does not constitute a Non-OECD Asset;
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(xii) which is denominated and payable in Dollars or an Eligible Foreign Currency; and
(xiii) which relates to Loan Documents in full force and effect which are legal, valid and binding obligations of the parties purported to be bound thereby, enforceable against such parties in accordance with their respective terms.
“Eligible Money Market Investment" means an investment with a maturity of 360 days or less (i) in a money market fund having a rating of "AAAm" or "AAAm-g" from S&P or a rating of "P-1" from Moody’s, or (ii) in Eaton Vance Cash Reserves Fund, LLC (solely to the extent that (x) it meets the requirements of SEC Rule 2a-7 under the Investment Company Act and (y) Eaton Vance Management or an Affiliate of Eaton Vance Management acts as its investment manager).
"Eligible Successor Adviser" means a wholly-owned direct or indirect subsidiary of Morgan Stanley or another registered investment adviser approved by the Board of Trustees of the Borrower, in each case which has executed a letter agreement in favor of the Agent in substantially the form of the Letter Agreement in effect on the Restatement Effective Date and which has been approved of in writing by the Agent.
"E-Mail Report" shall have the meaning assigned to such term in Section 9.15.
"Equity Securities" means common stock and preferred stock, warrants, membership interests or partnership interests and securities that are convertible into common or preferred stock, membership interests or partnership interests.
"ERISA" means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated and rulings issued thereunder.
"ERISA Group" means the Borrower and all members of a controlled group of corporations and all trades or businesses (whether or not incorporated) under common control which, together with the Borrower, are treated as a single employer under Section 414(b), (c), (m) or (n) of the Code.
“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor person), as in effect from time to time.
"Euro" means the lawful currency of Member States of the European Union that adopt the single currency introduced in accordance with the Treaty Establishing the European Community, as amended.
"Eurocurrency Liabilities" shall have the meaning assigned to such term in Regulation D of the Board of Governors of the Federal Reserve System, as in effect from time to time.
"Eurodollar Additional Yield" means additional Yield on the outstanding principal of each Advance during the Settlement Period in respect of such Advance in respect of which Yield is computed by reference to the Eurodollar Rate, for such Settlement Period, at a rate per annum equal at all times during such Settlement Period to the remainder obtained by subtracting (i) the Eurodollar Rate for such Settlement Period from (ii) the rate obtained by dividing such Eurodollar Rate referred to in clause (i) above by that percentage equal to percent (%) minus the Eurodollar Rate Reserve Percentage of the applicable Lender (other than a Conduit Lender) or Secondary Lender, as the case may be, for such Settlement Period.
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"Eurodollar Rate" means, for any Advance funded or maintained by a Lender (other than a Conduit Lender) or a Secondary Lender for any Settlement Period, an interest rate per annum equal to the rate per annum obtained by dividing (a) the rate per annum (rounded upward to the nearest whole multiple of % per annum) appearing on the display designated as "BBAM" on the screens maintained by Bloomberg, L.P. (or on any successor or substitute page of Bloomberg, L.P., or any successor to or substitute for Bloomberg, L.P., providing rate quotations comparable to those currently provided on such page of Bloomberg, L.P., as determined by the Agent from time to time for purposes of providing quotations of interest rates applicable to Dollar deposits in the London interbank market) as the London interbank offered rate for deposits in Dollars at approximately 11:00 a.m. (London time) two (2) Business Days prior to the first day of such Settlement Period for a term comparable to such Settlement Period or, if for any reason such rate is not available and a Benchmark Transition Event or an Early Opt-in Election, as applicable, and its related Benchmark Replacement Date have not occurred with respect to USD LIBOR , the rate per annum (rounded upwards to the nearest whole multiple of % per annum) at which Dollar deposits of $ and for a maturity comparable to such Settlement Period are offered by the principal London office of Citibank in the London interbank market at 11:00 a.m. (London time) two (2) Business Days before the first day of such Settlement Period, by (b) a percentage equal to % minus the Eurodollar Rate Reserve Percentage for such Settlement Period. Notwithstanding the foregoing, the Eurodollar Rate shall not be less than %.
"Eurodollar Rate Advance" means an Advance made or maintained by a Lender (other than a Conduit Lender) or a Secondary Lender, the Yield on which is computed with reference to the Eurodollar Rate.
"Eurodollar Rate Reserve Percentage" for any Settlement Period for any Eurodollar Rate Advance means the reserve percentage applicable during such Settlement Period under regulations issued from time to time by the Board of Governors of the Federal Reserve System (or any successor) (or if more than one such percentage shall be applicable, the daily average of such percentages for those days in such Settlement Period during which any such percentage shall be so applicable) for determining the maximum reserve requirement (including, without limitation, any emergency, supplemental or other marginal reserve requirement) for a Lender (other than a Conduit Lender) or any Secondary Lender with respect to liabilities or assets consisting of or including Eurocurrency Liabilities (or any other category of liabilities that includes deposits by reference to which the interest rate on Eurocurrency Liabilities is determined) having a term comparable to such Settlement Period.
"Event of Default" means any of the events, acts or occurrences set forth in Section 6.01.
"Exchange Act" means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC thereunder, all as from time to time in effect, or any successor law, rules or regulations, and any reference to any statutory or regulatory provision shall be deemed to be a reference to any successor statutory or regulatory provision.
"Existing Credit Agreement" shall have the meaning assigned to such term in the introduction to this Agreement.
"Facility" shall have the meaning assigned to such term in Section 9.09.
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"Federal Funds Rate" means, for any period, a fluctuating interest rate per annum equal for each day during such period to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System, as published for such day (or, if such day is not a Business Day, for the next preceding Business Day) by the Federal Reserve Bank of New York, or, if such rate is not so published for any day which is a Business Day, the average of the quotations for such day on such transactions received by Citibank from three Federal funds brokers of recognized standing selected by it.
"Fee Letter" means that certain amended and restated letter agreement dated the date hereof between the Borrower and the Agent, as the same may from time to time be amended, supplemented, waived or modified.
"Fitch" means Fitch Ratings Inc., together with its successors.
"Foreign Asset" means any Asset issued, guaranteed or owing by persons organized under the laws of any OECD Country (other than the United States of America) and which is denominated and payable in Dollars or an Eligible Foreign Currency.
"GAAP" means generally accepted accounting principles in the United States, in effect from time to time, consistently applied.
"Governmental Authorizations" means all franchises, permits, licenses, approvals, consents and other authorizations of all Authorities.
"Governmental Filings" means all filings, including franchise and similar tax filings, and the payment of all fees, assessments, interests and penalties associated with such filing with all Authorities.
"Guarantee" by any Person means any obligation, contingent or otherwise, of such Person directly or indirectly guaranteeing any Debt or other obligation of any other Person and, without limiting the generality of the foregoing, any obligation, direct or indirect, contingent or otherwise, of such Person (i) to purchase or pay (or advance or supply funds for the purchase or payment of) such Debt or other obligation (whether arising by virtue of partnership arrangements, or by agreement to keep-well, to purchase assets, goods, securities or services, to take-or-pay, or to maintain financial statement conditions or otherwise) or (ii) entered into for the purpose of assuring in any other manner the obligee of such Debt or other obligation of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part); provided, that the term "Guarantee" shall not include endorsements for collection or deposit in the ordinary course of business. The term "Guarantee" used as a verb has a corresponding meaning.
"Illiquid Asset" means as of any date, any Restricted Security or any other Asset for which (i) there is no established public or private institutional trading market in the United States, such that such Asset may be reasonably expected to be sold in such market within seven (7) days in the ordinary course of business at a price approximating the Asset Value of such Asset on such date subject only to fluctuations in the market price therefor, (ii) the fair market value of such Asset, is not readily ascertainable from recognized independent sources in the market for such Assets, or (iii) are otherwise categorized as "illiquid securities" by the Borrower or the Adviser.
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"Industry Class" means any industry class set forth on Schedule III hereto, as such Schedule III may be amended and supplemented from time to time with the prior written consent of the Agent.
"Investment Company Act" means the Investment Company Act of 1940, as amended, and the rules and regulations of the SEC thereunder, as modified or interpreted by orders of the SEC, or other interpretative releases or letters issued by the SEC or its staff, all as from time to time in effect, or any successor law, rules or regulations, and any reference to any statutory or regulatory provision shall be deemed to be a reference to any successor statutory or regulatory provision.
"Investment Policies and Restrictions" means the provisions dealing with investment policies, distributions, investment restrictions, tender offers, repurchases, leverage and diversification status as set forth in the Borrower’s Prospectus in effect on the Restatement Effective Date as modified as permitted by Section 5.02(i).
"Investor Report" means the Investor Report of the Borrower substantially in the form of Schedule I hereto.
"Largest Issuers" shall have the meaning assigned to such term in the definition of "Borrowing Base Excess Amount".
"Law" means any action, code, consent decree, constitution, decree, directive, enactment, finding, guideline, law, injunction, interpretation, judgment, order, ordinance, policy statement, proclamation, promulgation, regulation, requirement, rule, rule of law, rule of public policy, settlement agreement, statute, or writ, of any Authority, or any particular section, part or provision thereof.
"Lenders" means the Conduit Lenders, together with all Persons which acquire or are obligated to acquire any interest in any Advance under an Asset Purchase Agreement or in the case of Citibank, under any similar arrangement, or otherwise.
"Letter Agreement" means the Amended and Restated Letter Agreement dated as of the date hereof from the Adviser to the Agent on behalf of the Secured Parties, as the same may from time to time be amended, supplemented, waived or modified.
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien or security interest (statutory or other), or preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever (including, without limitation, any conditional sale or other title retention agreement, any financing lease having substantially the same economic effect as any of the foregoing, and the filing of any financing statement under the UCC or comparable law of any jurisdiction).
"Liquidation Fee" means, in respect of any Advance for any Settlement Period which is funded by a Conduit Lender during which the principal on such Advance is repaid by the Borrower in whole or in part, the amount, if any, by which (i) the additional Yield (calculated without taking into account any Liquidation Fee or any shortened duration of such Settlement Period) which would have accrued during such Settlement Period on the reduction of the outstanding principal amount of such Advance relating to such Settlement Period had such reductions remained as outstanding principal, exceeds (ii) that income, if any, received by the applicable Conduit Lender's investing the proceeds of such reductions of principal.
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"Loan Asset" means a direct or participation or sub-participation interest in or assignment or novation of a loan or other extension of credit.
"Loan Documents" means with respect to any Loan Asset, each loan agreement, promissory note, collateral security agreement, participation certificate, guarantee and any other agreement or document evidencing, securing, governing or executed in connection with such Loan Asset, including without limitation, the agreements and instruments in respect of which the Borrower acquired such Loan Asset.
"Margin Stock" shall have the meaning assigned to such term in Regulation U.
"Margin Stock Percentage" means, as of any date of determination, the then current percentage of market value assigned by the Board of Governors of the Federal Reserve System under Section 221.7 of Regulation U to Margin Stock (which percentage, as of the Restatement Effective Date, is percent (%)).
"Material Adverse Effect" means a (i) material adverse effect on the ability of the Borrower or the Adviser to perform its obligations under this Agreement, any other Program Document or any Loan Document, (ii) a material adverse effect on any Secured Party’s right, title and interest in the Pledged Collateral or on the rights and remedies of any Secured Party under any Program Document, (iii) a material adverse effect on the business, financial position, operations, Assets or properties of the Borrower or the Adviser, or (iv) a Default or Event of Default.
"Matrix Price" means, with respect to any Loan Asset, the matrix price derived from an Approved Pricing Service in a manner approved by the Board of Trustees of the Borrower and in accordance with the Prospectus of the Borrower in effect on the Restatement Effective Date and in accordance with Applicable Law, including without limitation the rules, regulations and interpretations of the SEC under the Investment Company Act.
"Maturity Date" means the Termination Date (or if such day is not a Business Day, the Business Day immediately preceding such date) or such earlier date as provided in Section 6.01.
"Moody's" means Moody's Investors Service, Inc., together with its successors.
“Morgan Stanley” means Morgan Stanley, a Delaware corporation.
"Multiemployer Plan" means an employee pension benefit plan within the meaning of Section 4001(a)(3) of ERISA.
"NASDAQ" means the NASDAQ Stock Market.
"NAV" means in respect of the Borrower, the net asset value of the Borrower computed in the manner such net asset value is required to be computed by the Borrower in accordance with the Investment Company Act and as described in its Prospectus; provided that, for the avoidance of doubt, NAV shall be computed for the Borrower on an aggregate basis taking into account the market value of the Borrower’s Assets and Debts, and not on a per share basis.3
3 Amendment No. 3
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"Non-OECD Asset" means any Asset issued or Guaranteed by a Person organized or domiciled outside of any OECD Country or with respect to any Loan Asset, the Obligor of which is organized outside of any OECD Country.
"Notice of Borrowing" shall have the meaning assigned to such term in Section 2.02.
"Notice of Conversion or Continuation" shall have the meaning assigned to such term in Section 2.06(a).
"Notice of Exclusive Control" shall have the meaning assigned to such term in the Control Agreement.
"NYSE" means the New York Stock Exchange.
"Obligor" means in respect of any Loan Asset, the Person primarily obligated under the related Loan Documents to repay the loan or extension of credit which is the subject of such Loan Asset.
"OECD Country" means the United States of America and any other country which is a member of the Organization for Economic Cooperation and Development and which has a sovereign credit rating for "foreign currency" of at least "AA-" and "Aa3" from S&P and Moody’s, respectively.
"OFAC" means the U.S. Office of Foreign Assets Control, together with any successor thereto.
"Origination Date" means in respect of any Loan Asset the initial date on which the proceeds of the loan or other extension of credit which is the subject of such Loan Asset was advanced to the Obligor under the related Loan Documents.
"Percentage" of any Secondary Lender means, (a) with respect to Citibank, the percentage set forth on the signature page to this Agreement, or such amount as reduced by any Assignment and Acceptance entered into with an Eligible Assignee, or (b) with respect to a Secondary Lender that has entered into an Assignment and Acceptance, the percentage set forth therein as such Secondary Lender’s Percentage, or such amount as reduced by an Assignment and Acceptance entered into between such Secondary Lender and an Eligible Assignee.
"Permitted Debt" means (a) (i) Debt arising under this Agreement or the other Program Documents to the Secured Parties, (ii) Debt in favor of the Custodian relating to Custodian's Overdraft Advances incurred in the ordinary course of the Borrower’s business, which are not overdue, (iii) accrued expenses and current trade accounts payable incurred in the ordinary course of the Borrower’s business which are not overdue for a period of more than thirty (30) days or which are being contested in good faith by appropriate proceedings, (iv) Debt (other than Debt for borrowed money) arising in connection with transactions in the ordinary course of the Borrower’s business in connection with its purchasing of Assets, Derivatives Transactions, reverse repurchase agreements or dollar rolls to the extent such purchases are permitted under the Investment Company Act and the Borrower’s Investment Policies and Restrictions, (v) obligations of the Borrower to fund future extensions of credit under the Loan Documents relating to its Loan Assets which do not exceed percent (%) of the aggregate Asset Value of the Borrower's Assets and which meet the Borrower's diversification requirements set forth under the heading "Investment Restrictions" in the Borrower's Statement of Additional
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Information as of the Restatement Effective Date, (vi) Debt in respect of judgments or awards so long as such judgments or awards do not constitute an Event of Default and so long as the Borrower shall at the time in good faith be diligently prosecuting an appeal or proceeding for review and in respect of which a stay of execution shall have been obtained pending such appeal or review, and (vii) endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (b) any other Debt (other than Debt for borrowed money), to the extent such Debt arises from a transaction permitted under the Investment Company Act and the Borrower’s Investment Policies.
"Permitted Liens" means (a) in respect of any Asset of the Borrower, (i) Liens of any Secured Party created by or pursuant to this Agreement or the Control Agreement, (ii) Liens of the Custodian securing the Custodian's Overdraft Advances to the extent such Custodian’s Overdraft Advances do not exceed the amount permitted by Section 5.02(p), (iii) Liens of the Custodian which are by the terms of the Control Agreement expressly subordinated to the payment of the Borrower Obligations, (iv) Liens for taxes, assessments or other governmental charges or levies not at the time delinquent or being diligently contested in good faith by appropriate actions and for which adequate reserves in accordance with GAAP shall have been set aside on the Borrower’s books, (v) Liens in respect of judgments or awards so long as such judgments or awards do not constitute an Event of Default and so long as the Borrower shall at the time in good faith be diligently prosecuting an appeal or proceeding for review and in respect of which a stay of execution shall have been obtained pending such appeal or review, (vi) Liens incidental to the conduct of the Borrower’s business securing the performance of fee and expense obligations to the Custodian and other similar agents which are providing services in respect of the Borrower’s Assets arising in the ordinary course of the Borrower’s business which are not overdue for a period in excess of thirty (30) days, and (vii) Liens in respect of the Debt permitted under clause (a) (iv) of the definition of Permitted Debt and (b) in respect of any Asset of the Borrower which does not constitute Pledged Collateral and which is not maintained in the Collateral Account, Liens in favor of the relevant party to transactions permitted in accordance with clause (b) of the definition of Permitted Debt, in respect of which collateral is pledged by the Borrower to such parties to secure the Borrower's obligations to such parties.
"Permitted Senior Securities" means "senior securities" within the meaning of the Investment Company Act which constitute Advances under this Agreement, Auction Preferred Shares, Derivatives Transactions, repurchase transactions, reverse repurchase transactions, or commitments of the Borrower to fund future advances or other extensions of credit under any Loan Document, to the extent the issuance of any such senior security by the Borrower is not in contravention of the Investment Company Act or the Borrower's Investment Policies and Restrictions in effect on the Restatement Effective Date.
"Person" means an individual or a corporation (including a business trust), partnership, trust, incorporated or unincorporated association, joint stock company, limited liability company, government (or an agency or political subdivision thereof) or other entity of any kind.
"Plan" means an employee pension benefit plan (other than a Multiemployer Plan) which is covered by Title IV of ERISA or subject to the minimum funding standards under Section 412 of the Code.
"Pledged Collateral" shall have the meaning assigned to such term in Section 7.01.
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"Post-Default Rate" means in respect of all amounts payable to any Secured Party under any Program Document not paid when due (whether at stated maturity, by acceleration or otherwise), including, without limitation, the principal and Yield on any Advance not paid when due, a rate per annum during the period commencing on the due date until such amount is paid in full equal to the applicable Base Rate as in effect from time to time plus percent (%).
"Preferred Stock" means an Equity Security which represents an equity interest in an issuer that entitles the holder to receive, in preference to holders of other stock such as common stock, dividends and a fixed share of the proceeds resulting from the liquidation of such issuer.
"Principal Office" means the principal office of Citibank, N.A. presently located at 399 Park Avenue, New York, New York or at such other location as the Agent shall designate in writing to the Borrower.
"Private Authorizations" means all franchises, permits, licenses, approvals, consents and other authorizations of all Persons (other than Authorities) including, without limitation, those with respect to trademarks, service marks, trade names, copyrights, computer software programs, technical and other know-how.
"Proceeds" shall have, with reference to any asset or property, the meaning assigned to it under the UCC and, in any event, shall include, but not be limited to, any and all amounts from time to time paid or payable under or in connection with such asset or property.
"Product Information" shall have the meaning assigned to such term in Section 9.09(a).
"Program Documents" means this Agreement, the Advance Notes, the Letter Agreement, the Control Agreement, the Advisory Agreement, the Custodial Agreement, the Asset Purchase Agreement, the Fee Letter, the Loan Documents and the other agreements, documents and instruments entered into or delivered in connection herewith or therewith.
"Program Termination Date" means the later to occur of (i) the Termination Date, and (ii) the date that all Borrower Obligations have been finally paid in full; provided, however, that if any payment in respect of any Borrower Obligation made to any Secured Party must be rescinded or returned for any reason whatsoever (including the insolvency or bankruptcy of the Borrower) such Borrower Obligation shall be deemed to be reinstated as though such payment had not been made and the Program Termination Date shall be deemed to have not occurred.
"Prospectus" means with respect to the Borrower the prospectus dated October 24, 2018 filed with the SEC as a part of the Borrower’s registration statement on Form N-2, as amended, and shall include, without limitation, the related statement of additional information, if any, included in such registration statement, and all supplements, amendments and modifications thereto as of the Restatement Effective Date, and as further supplemented, amended or modified in accordance with Applicable Law, including, without limitation, the Securities Act and the Investment Company Act.
"PTE" means a prohibited transaction class exemption issued by the United States Department of Labor, as any such exemption may be amended from time to time.”
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"Rating Agencies" means S&P, Moody’s and Fitch, or any other nationally-recognized statistical rating agency which has been approved of in writing by the Agent.
"Regulation T" means Regulation T of the Board of Governors of the Federal Reserve System, as in effect from time to time.
"Regulation U" means Regulation U of the Board of Governors of the Federal Reserve System, as in effect from time to time.
"Regulation X" means Regulation X of the Board of Governors of the Federal Reserve System, as in effect from time to time.
“Related Parties” means, with respect to any Person, such Person’s Affiliates and the partners, members, managers, directors, officers, employees, agents and advisors of such Person and of such Person’s Affiliates.
"Requested Amount" shall have the meaning assigned to such term in Section 2.02.
"Requisite Ratings" shall have the meaning assigned to such term in Section 2.08(e).
“Resolution Authority” means an EEA Resolution Authority or, with respect to any UK Financial Institution, a UK Resolution Authority.
"Responsible Officer" means in respect of any Person, the president, the executive vice president, the senior vice president, any vice president, the treasurer, the secretary, any other duly authorized officer of such Person, or any other authorized Person designated by any such Person; provided, that the Agent shall have received a manually signed certificate of the Secretary or Assistant Secretary of such Person as to the incumbency of or authority of, and bearing a manual specimen signature of, such duly authorized officer or authorized Person.
"Restatement Effective Date" means the first date on which the conditions precedent specified in Section 3.03 have been fully satisfied.
"Restricted Payments" means (a) the declaration of any distribution or dividends (other than distributions payable solely in shares of beneficial interest in the Borrower) on, or the payment on account of, or the setting apart of assets for the purchase, redemption, retirement or other acquisition of any shares of beneficial interests in the Borrower, whether now or hereafter outstanding, either directly or indirectly, whether in cash, property or in obligations of the Borrower, and (b) the payment of fees and expenses to the Adviser or any Affiliate of the Adviser as compensation for the provision of managerial, administrative services or otherwise.
"Restricted Security" shall have the meaning assigned to such term under Rule 144.
"Rule 144" means Rule 144 promulgated by the SEC under the Securities Act, as amended and from time to time in effect, or any successor regulatory provision.
"S&P" means Standard & Poor's Ratings Services, together with its successors.
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"Sanctioned Country" means, at any time, a country or territory that is, or whose government is, the subject of Sanctions, including, without limitation, currently, Crimea, Cuba, Iran, North Korea, Sudan and Syria.
"Sanctioned Person" means a Person that is, or is owned or controlled by Persons that are, (i) the subject of any Sanctions, or (ii) located, organized or resident in a Sanctioned Country.
"Sanctions" shall have the meaning assigned to such term in Section 4.01(w).
"Sanctions Laws" are the laws, regulations, and rules promulgated or administered by OFAC to implement US sanctions programs, including any enabling legislation or Executive Order related thereto, as amended from time to time; the US Comprehensive Iran Sanctions, Accountability, and Divestment Act and the regulations and rules promulgated thereunder, as amended from time to time; the US Iran Threat Reduction and Syria Human Rights Act and the regulations and rules promulgated thereunder, as amended from time to time; the US Iran Freedom and Counter-Proliferation Act and the regulations and rules promulgated thereunder; the sanctions and other restrictive measures applied by the European Union in pursuit of the Common Foreign and Security Policy objectives set out in the Treaty on European Union; and any similar sanctions laws as may be enacted from time to time in the future by the U.S., the European Union (and its Member States), or the Security Council or any other legislative body of the United Nations; and any corresponding Laws administered by any applicable Authority or Laws of jurisdictions in which the Borrower operates or in which the proceeds of the Advances will be used or from which repayments of the Borrower Obligations will be derived.
"SEC" means the Securities and Exchange Commission or any other governmental authority of the United States of America at the time administrating the Securities Act, the Investment Company Act or the Exchange Act.
"Secondary Lender Commitment" means (a) with respect to Citibank, subject to Section 2.01(a), an amount equal to the Total Commitment, as such amount shall be adjusted by any Assignment and Acceptance entered into between Citibank and an Eligible Assignee, or (b) with respect to a Secondary Lender that has entered into an Assignment and Acceptance, the amount set forth therein as such Secondary Lender's "Secondary Lender Commitment" in each case as such amount may be reduced by an Assignment and Acceptance entered into between such Secondary Lender and an Eligible Assignee, and as may be further reduced (or terminated) pursuant to the next sentence. Any reduction (or termination) of the Total Commitment pursuant to the terms of this Agreement shall reduce ratably (or terminate) each Secondary Lender's Secondary Lender Commitment.
"Secondary Lender Stated Expiration Date" means March 7, 20224, as such date may be extended by the parties hereto for additional periods not to exceed 364 days per period.
"Secondary Lenders" means Citibank and each Eligible Assignee that becomes a party to this Agreement pursuant to Section 9.06(b).
"Secured Parties" means the Agent, the Lenders, the Secondary Lenders and their respective successors and assigns.
4 Amendment No. 1; Amendment No. 2; Amendment No. 5
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"Securities Act" means the Securities Act of 1933, as amended, and the rules and regulations of the SEC thereunder, all as from time to time in effect, or any successor law, rules or regulations, and any reference to any statutory or regulatory provisions shall be deemed to be a reference to any successor statutory or regulatory provision.
"Selling Institution" means in respect of any Loan Asset which constitutes a participation interest, the Person which has granted or sold to the Borrower a participation interest in the loan or other extension of credit which is the subject of such Loan Asset.
"Settlement Date" means the date which is two (2) Business Days after the end of each Settlement Period.
"Settlement Period" means in respect of any Advance:
(a) in the case of any Settlement Period in respect of which Yield in respect of such Advance is computed by reference to the CP Rate, the period beginning on the date such Advance was made and ending on the last day of the calendar month in which such Advance was made and thereafter each successive period commencing on the first day of each calendar month during the term of this Agreement and ending on the last day of such calendar month during the term of this Agreement; provided, however, that in the case of any Settlement Period for any Advance which commences before the Maturity Date for such Advance and would otherwise end on a date occurring after such Maturity Date, such Settlement Period shall end on such Maturity Date and the duration of each Settlement Period which commences on or after the Maturity Date for such Advance may be any period (including, without limitation, a period of one day) as shall be selected from time to time by the Agent;
(b) in the case of any Settlement Period in respect of which Yield in respect of such Advance is computed by reference to the Assignee Rate, the period beginning on the date such Advance was made and ending on the last day of the calendar month in which such Advance was made and thereafter each successive period commencing on the first day of each calendar month during the term of this Agreement and ending on the last day of such calendar month during the term of this Agreement; provided, however, that any Settlement Period which is other than the monthly Settlement Period shall be of such duration as shall be selected by the Agent; provided, further, that each Settlement Period which would otherwise commence before and end after the Termination Date shall end on the Termination Date; and
(c) in the case of any Settlement Period in respect of which Yield is computed by reference to the Alternate Base Rate, such Settlement Period shall be of such duration as shall be selected by the Agent.
"Specified Loan Documents" shall have the meaning assigned to such term in the Control Agreement.
"Sterling" means the lawful currency of the United Kingdom of Great Britain and Northern Ireland.
"Swiss Francs" means the lawful currency of Switzerland.
"Taxes" shall have the meaning assigned to such term in Section 9.03(a).
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"Termination Date" means the earlier of (i) the Secondary Lender Stated Expiration Date, and (ii) the date the Total Commitment shall terminate pursuant to Section 2.11 or Section 6.01.
"Total Commitment" means $, as such amount may be reduced pursuant to Section 2.11 or Section 5.02(n). References to the unused portion of the Total Commitment shall mean, at any time, the Total Commitment then in effect, minus the outstanding principal amount of the Advances.
"Transaction Agent" means a commercial bank, insurance company, finance company or other financial institution that is acting as agent or trustee under the Loan Documents relating to any Loan Asset.
"Trustee" shall have the meaning assigned to such term in the Declaration of Trust.
"Trust Indenture Act" shall have the meaning assigned to such term in Section 8.03.
"UCC" means the Uniform Commercial Code, as from time to time in effect in the applicable jurisdictions.
“UK Financial Institution” means any BRRD Undertaking (as such term is defined under the PRA Rulebook (as amended from time to time) promulgated by the United Kingdom Prudential Regulation Authority) or any person falling within IFPRU 11.6 of the FCA Handbook (as amended from time to time) promulgated by the United Kingdom Financial Conduct Authority, which includes certain credit institutions and investment firms, and certain affiliates of such credit institutions or investment firms.
“UK Resolution Authority” means the Bank of England or any other public administrative authority having responsibility for the resolution of any UK Financial Institution.
"Unfunded Loan Commitment" means the obligation of the Borrower to fund loans or other extensions of credit pursuant to the terms of any Loan Document to which the Borrower is a party.
"Unrated Asset" shall mean an Asset that is rated by neither S&P nor Moody’s.
"Value" shall have the meaning assigned to such term in Section 2(a)(41) of the Investment Company Act.
“Write-Down and Conversion Powers” means, (a) with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule, and (b) with respect to the United Kingdom, any powers of the applicable Resolution Authority under the Bail-In Legislation to cancel, reduce, modify or change the form of a liability of any UK Financial Institution or any contract or instrument under which that liability arises, to convert all or part of that liability into shares, securities or obligations of that person or any other person, to provide that any such contract or instrument is to have effect as if a right had been exercised under it or to suspend any obligation in respect of that liability or any of the powers under that Bail-In Legislation that are related to or ancillary to any of those powers.
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"Yield" means for each Advance for each Settlement Period:
(i) for each day during such Settlement Period to the extent such Advance will be funded or maintained on such day by a Conduit Lender through the issuance of commercial paper notes,
CPR x P + LF
360
(ii) for each day during such Settlement Period to the extent such Advance will be funded or maintained on such day by a Secondary Lender or a Lender (other than a Conduit Lender),
AR x P
360
where:
| AR = | the Assignee Rate for such Advance for such Settlement Period |
| P = | the outstanding principal amount of such Advance on such day |
| CPR = | the CP Rate for such Advance on such day |
| LF = | the Liquidation Fee, if any, for such Advance for such Settlement Period (expressed as a daily amount); |
provided, further, that Yield for any Advance shall not be considered paid by any distribution to the extent that at any time all or a portion of such distribution is rescinded or must otherwise be returned for any reason; provided, further, that notwithstanding the foregoing, to the extent that any Advance is an Alternate Base Rate Advance, the Yield for such Advance shall be computed with respect to the Alternate Base Rate.
SECTION 1.02. Rules of Construction.
For all purposes of this Agreement, except as otherwise expressly provided or unless the context otherwise requires (i) singular words shall connote the plural as well as the singular, and vice versa (except as indicated), as may be appropriate, (ii) the words "herein," "hereof" and "hereunder" and other words of similar import used in this Agreement refer to this Agreement as a whole and not to any particular appendix, article, schedule, section, paragraph, clause, exhibit or other subdivision, (iii) the headings, subheadings and table of contents set forth in this Agreement are solely for convenience of reference and shall not constitute a part of this Agreement nor shall they affect the meaning, construction or effect of any provision hereof, (iv) references in this Agreement to "including" shall mean including without limiting the generality of any description preceding such term, and for purposes hereof the rule of ejusdem generis shall not be applicable to limit a general statement, followed by or referable to an enumeration of specific matters, to matters similar to those specifically mentioned, and (v) each
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of the parties to this Agreement and its counsel have reviewed and revised, or requested revisions to, this Agreement, and the usual rule of construction that any ambiguities are to be resolved against the drafting party shall be inapplicable in the construction and interpretation of this Agreement.
SECTION 1.03. Computation of Time Periods.
Unless otherwise stated in this Agreement, in the computation of a period of time from a specified date to a later specified date, the word "from" means "from and including" and the words "to" and "until" both mean "to but excluding".
Article
II
ADVANCES TO THE BORROWER
SECTION 2.01. Advance Facility.
(a) On the terms and conditions hereinafter set forth, including without limitation, Sections 3.02 and 3.03, any Conduit Lender may, in its sole discretion, make Advances to the Borrower on any Borrowing Date from the date hereof to the Termination Date. On the terms and conditions hereinafter set forth, including without limitation, Sections 3.02 and 3.03 and during the period from the date hereof to the Termination Date, the Secondary Lenders shall make Advances to the Borrower, ratably in accordance with their respective Secondary Lender Commitments, to the extent no Conduit Lender has determined to make such Advance. Under no circumstances shall any Conduit Lender or any Secondary Lender make any such Advance to the extent that after giving effect to the making of such Advance the aggregate principal amount of all outstanding Advances would exceed the Total Commitment.
(b) The failure of any Secondary Lender to make any Advance to be made by it on any Borrowing Date shall not relieve any other Secondary Lender of its obligation to make its Advance on such Borrowing Date, but neither any Secondary Lender nor the Agent shall be responsible for the failure of any other Secondary Lender to make an Advance. The amounts payable by the Borrower to each Conduit Lender and each Secondary Lender at any time hereunder and under the Advance Notes to each Conduit Lender and each Secondary Lender shall be a separate and independent debt and each Conduit Lender and each Secondary Lender shall be entitled to protect and enforce its rights arising out of this Agreement and the Advance Notes, and it shall not be necessary for any other Conduit Lender, Secondary Lender or the Agent to consent to, or be joined as an additional party in, any proceedings for such purposes.
SECTION 2.02. Making of Advances.
The Borrower shall give the Agent written notice (which notice shall be irrevocable and effective only upon receipt by the Agent) of each request for an Advance (each such request a "Notice of Borrowing") not later than 12:00 noon (New York City time) on the day which is two (2) Business Days (or in respect of the initial Borrowing Date, as otherwise agreed between the Borrower and the Agent) prior to the proposed borrowing date, which notice shall specify (i) the proposed borrowing date therefor (each such date, a "Borrowing Date"), (ii) the aggregate principal amount of the proposed borrowing (the "Requested Amount"), and (iii) whether such borrowing, to the extent funded by a Secondary Lender, shall be an Alternate Base Rate Advance or a Eurodollar Rate Advance. Any such Notice of Borrowing shall be substantially in the form of Exhibit B hereto, dated the date such request is being made, signed by a Responsible Officer of the Borrower and otherwise appropriately completed. The
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Requested Amount specified in any Notice of Borrowing shall be at least $ and in integral multiples of $ in excess thereof. The Borrower shall not request that more than two (2) Borrowing Dates occur in any single calendar week. During the period prior to the Termination Date, each Conduit Lender shall promptly notify the Agent whether it has determined to make a proposed Advance and the Agent shall promptly thereafter notify the Borrower whether any of the Conduit Lenders has determined to make such Advance. If the Conduit Lenders have declined to make such proposed Advance, the Agent shall promptly send notice of the proposed borrowing to the Secondary Lenders concurrently by facsimile or electronic mail specifying the Borrowing Date for such borrowing, each Secondary Lender’s Percentage multiplied by the principal amount of such Advance and whether the Yield for such Advance is calculated based on the Eurodollar Rate or the Alternate Base Rate. On each Borrowing Date the applicable Conduit Lenders or the Secondary Lenders shall, subject to the terms and conditions of this Agreement, make available to the Borrower at the Borrower's Account the Requested Amount in immediately available funds. To the extent not covered by Section 2.09, the Borrower shall indemnify each Conduit Lender, each Secondary Lender and the Agent against any loss or expense incurred by them as a result of any failure by the Borrower to accept any Advance requested in a Notice of Borrowing or as a result of the failure of the Borrower to receive any Advance requested in a Notice of Borrowing as a result of the failure of any condition precedent to the making of such Advance to be satisfied, including, without limitation, any loss or expense incurred by reason of the liquidation or reemployment of funds acquired or requested to fund such Advance.
SECTION 2.03. Noteless Agreement; Evidence of Indebtedness.
(a) Each Conduit Lender and each Secondary Lender shall maintain in accordance with its usual practice an account or accounts evidencing the indebtedness of the Borrower to it and resulting from each Advance made by it, from time to time, including the amounts of principal and Yield thereon and paid to it, from time to time hereunder.
(b) The Agent shall maintain accounts in which it will record (i) the amount of each Advance made hereunder and the Settlement Period with respect thereto, (ii) the amount of any principal and Yield due and payable or to become due and payable from the Borrower to each Conduit Lender and each Secondary Lender hereunder, and (iii) the amount of any sum received by the Agent hereunder from the Borrower and each Conduit Lender's and each Secondary Lender's share thereof.
(c) The entries maintained in the accounts maintained pursuant to clauses (a) and (b) of this Section 2.03 shall be rebuttable presumptive evidence of the existence and amounts of the Borrower Obligations therein recorded; provided, however, that the failure of the Agent, any Conduit Lender or any Secondary Lender to maintain such accounts or any error therein shall not in any manner affect the obligation of the Borrower to repay the Borrower Obligations in accordance with their terms.
(d) Any Conduit Lender or any Secondary Lender may request that its Advances be evidenced by an Advance Note. In such event, the Borrower shall promptly prepare, execute and deliver to such Conduit Lender or such Secondary Lender, as applicable, an Advance Note payable to the order of such Conduit Lender or such Secondary Lender, as applicable. Thereafter, the Advances evidenced by such Advance Note and interest thereon shall at all times (including after any assignment pursuant to Section 9.06) be represented by one or more Advance Notes payable to the order of the payee named therein or any assignee pursuant to Section 9.06, except to the extent that such Conduit Lender, such Secondary Lender or assignee
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subsequently returns any such Advance Note for cancellation and requests that such Advance once again be evidenced as described in clauses (a) and (b) of this Section 2.03. In connection with any assignment pursuant to Section 9.06, if the assigning Secondary Lender shall have an Advance Note issued to it, the assigning Secondary Lender shall promptly return its Advance Note to the Agent marked "cancelled". As of the Restatement Effective Date, any outstanding Advance Notes (including those Advance Notes dated as of November 9, 1998 in favor of each of Corporate Receivables Corporation and Citibank, N.A.) shall be deemed to have been returned for cancellation and the Advances in connection therewith shall be evidenced as described in clauses (a) and (b) of this Section 2.03.
SECTION 2.04. Maturity of the Advances.
The principal amount of and the accrued and unpaid Yield on each outstanding Advance shall be due and payable by the Borrower on the Maturity Date for such Advance.
SECTION 2.05. Prepayment of the Advances.
(a) The Borrower shall have the right at any time and from time to time, upon not less than two (2) Business Days' prior written notice in the form of Exhibit D hereto or telephonic notice (in the case of telephonic notice, promptly confirmed in writing in the form of Exhibit D hereto) to the Agent specifying the date and amount of such prepayment, to prepay all or a portion of the outstanding Advances, together with unpaid Yield thereon, on a Business Day; provided, that any such prepayment, if a partial prepayment, shall be at least $ and an integral multiples of $ in excess thereof.
(b) If on any Business Day the Borrower is not in full compliance with the Borrowing Base Test (any such date, a "Borrowing Base Determination Date"), the Borrower shall on such Borrowing Base Determination Date (I) notify the Agent of such failure to comply, and (II) on the Business Day next succeeding such Borrowing Base Determination Date (each such date, a "Compliance Certification Date") prepay Advances (together with Yield thereon) and/or pledge to the Agent additional Borrowing Base Eligible Assets in an amount necessary to cause the Borrower to be in full compliance with the Borrowing Base Test on such Compliance Certification Date; provided, however, that to the extent the Borrower does not have sufficient available funds or Borrowing Base Eligible Assets to fully cure such compliance shortfall on such Compliance Certification Date, then the Borrower shall (i) on such Compliance Certification Date prepay outstanding Advances in the amount of its available funds; (ii) no later than the close of business on the seventh (7th) Business Day following such Borrowing Base Determination Date either (A) acquire and pledge to the Agent under this Agreement and the Control Agreement additional Borrowing Base Eligible Assets having an Adjusted Asset Value at least sufficient to cause the Borrowing Base (as determined on such Compliance Certification Date) to be at least equal to the product of (x) 1.05, and (y) Credits Outstanding, as determined on such Compliance Certification Date, or (B) prepay Advances in a principal amount (and pay the Yield thereon) at least sufficient to cause the Borrowing Base (as determined on such Compliance Certification Date) to be at least equal to the product of (x) 1.05 and (y) Credits Outstanding, as determined on such Compliance Certification Date; and (iii) no later than the close of business on such Compliance Certification Date, deliver to the Agent a certificate, signed by an Responsible Officer of the Borrower, that (1) certifies the amount of the compliance shortfall, (2) specifies whether the Borrower shall either (x) prepay the Advances in accordance with clause (B) above, or (y) acquire additional Borrowing Base Eligible Assets in accordance with clause (A) above and specifies the identity and Adjusted Asset Value of the Borrowing
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Base Eligible Assets for which the Borrower has entered into corrective trades in order to satisfy the requirements of clause (A) of this Section 2.05(b), and (3) certifies that the requirements of this Section 2.05(b) shall be satisfied on or prior to the seventh (7th) Business Day following such Borrowing Base Determination Date.
(c) If on any Business Day (any such date, a “Determination Date”) the Borrower is not in full compliance with the Asset Coverage Test (determined regardless of whether or not dividends or distributions are being made on such Business Day, or whether Debt is being incurred on such Business Day as if each outstanding Advance constituted a "senior security" without regard to whether such Advance is a loan for "temporary purposes" or otherwise excludable from the definition of "senior securities" under Section 18(g) of the Investment Company Act) or the aggregate outstanding amount of the Advances or other indebtedness of the Borrower exceeds any borrowing limits set forth in the Prospectus of the Borrower or any limits set forth under the Investment Company Act (each a "Borrowing Limit"), the Borrower shall (I) on such Determination Date notify the Agent of such failure to comply, and (II) prepay Advances on the next succeeding Business Day in a principal amount (and pay the Yield thereon) necessary to cause the Borrower to be in full compliance with the Asset Coverage Test and each Borrowing Limit, as applicable, provided, however, that to the extent the Borrower does not have sufficient available funds to prepay the Advances in an amount sufficient to cure such compliance shortfall on such Determination Date, then the Borrower shall (i) on such Determination Date prepay outstanding Advances in the amount of its available funds; (ii) no later than the close of business on the third (3rd) Business Day following such Determination Date sell such portion of its Assets as shall be necessary for the Borrower to prepay the Advances in an amount necessary to be in full compliance with the Asset Coverage Test and each Borrowing Limit, as applicable, as determined on the first Business Day after such Determination Date; and (iii) no later than the close of business on the second Business Day following such Determination Date, deliver to the Agent a certificate, signed by an authorized officer of the Borrower, that (1) certifies the amount of the compliance shortfall, (2) specifies the identity and Adjusted Asset Value of the Borrowing Base Eligible Assets for which the Borrower has entered into corrective trades in order to satisfy the requirements of clause (ii) of this Section 2.05(c), and (3) certifies that the requirements of this Section 2.05(c) shall be satisfied on or prior to the third (3rd) Business Day following such Determination Date.5
(d) If at any time the aggregate credit extended by the Lenders and the Secondary Lenders in connection with this Agreement exceeds the sum of (x) the product of (a) the Margin Stock Percentage multiplied by (b) the current market value (as defined in Regulation U) of all Margin Stock of the Borrower, plus, (y) the good faith loan value (as determined in accordance with Regulation U) of all other Assets of the Borrower, the Borrower shall as promptly as practicable, and in any event within one (1) Business Day, prepay the outstanding Advances in an amount equal to such excess, together with all accrued and unpaid Yield thereon. For the avoidance of doubt, the Agent and each Lender acknowledge that, unless otherwise required by any Authority or Regulation U, the Adjusted Asset Value of an Asset other than Margin Stock shall constitute the good faith value of that Asset for purposes of Regulation U.
(e) Subject to Section 7.03, the amount of each prepayment under this Section 2.05 shall be applied ratably to the Advances in the order in which such Advances were made; provided, however, that the amount of such prepayment shall be applied first to any outstanding Advances in respect of which Yield is computed by reference to the Alternate Base Rate, second to any outstanding Advances in respect of which Yield is computed by reference to the Eurodollar Rate, and third to any outstanding Advances in respect of which Yield is computed by reference to the CP Rate.
5 Amendment No. 1
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SECTION 2.06. Conversions; Continuations.
(a) The Borrower may, at its option, so long as no Event of Default shall have occurred and be continuing, (i) on the last day of any Settlement Period, convert a Eurodollar Rate Advance into an Alternate Base Rate Advance, (ii) on the last day of any Settlement Period, continue a Eurodollar Rate Advance as a Eurodollar Rate Advance, and (iii) on any Business Day, convert an Alternate Base Rate Advance into a Eurodollar Rate Advance, subject to the availability of such Eurodollar Rate and the obligations of the Borrower to make all payments required in connection therewith pursuant to Section 2.10; provided, that, (x) no conversion of any Advance shall result in more than eight (8) Eurodollar Rate Advances being outstanding to any Lender or Secondary Lender, and (y) except as otherwise provided in this Agreement to the contrary, the Borrower shall deliver to the Agent and the applicable Lender or Secondary Lender written notice (each such notice a "Notice of Conversion or Continuation") in the form of Exhibit E hereto (which notice shall be irrevocable and effective only upon receipt by the Agent and the applicable Lender or Secondary Lender) by 12:00 noon., New York time, not less than three (3) Business Days prior to the date of each such conversion or continuation. Each Notice of Conversion or Continuation shall specify (x) the amount of each Advance to be continued or converted, (y) the date of such continuation or conversion, and (z) if such Advance is to be converted into a Eurodollar Rate Advance. Each conversion of an Advance from one type to another shall be in an amount of at least $ and in integral multiples of $ in excess thereof (unless otherwise agreed to by the Agent or the applicable Lender or Secondary Lender). If the Borrower fails to give a Notice of Conversion or Continuation for any Advance in accordance with the terms hereof, the Borrower shall be deemed to have elected on the last day of the Settlement Period applicable to such Advance to continue such Advance as an Advance of the same type.
(b) Notwithstanding anything to the contrary contained herein, the aggregate principal amount of Eurodollar Rate Advances with the same Settlement Period shall be at least equal to $, and, if any Eurodollar Rate Advances would otherwise be in a lesser principal amount for any period, such Advances shall be Alternate Base Rate Advances during such period.
(c) Notwithstanding anything to the contrary set forth herein, upon the occurrence and continuance of an Event of Default, each Eurodollar Rate Advance shall automatically convert to an Alternate Base Rate Advance on the last day of the then current Settlement Period for such Eurodollar Rate Advance.
SECTION 2.07. Yield.
The Borrower hereby agrees to pay the Yield computed with reference to the principal amount of each Advance outstanding from time to time. Yield accruing in respect of any Advance for any Settlement Period shall be due and payable on the Settlement Date immediately succeeding such Settlement Period and as required by Section 2.05. It is the intention of the parties hereto that the Yield on the Advances shall not exceed the maximum rate permissible under applicable law. Accordingly, anything herein or in any Advance Note to the contrary notwithstanding, in the event any Yield is charged to, collected from or received from or on behalf of the Borrower by the Conduit Lenders or the Secondary Lenders pursuant hereto or thereto in excess of such maximum lawful rate, then the excess of such payment over that
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maximum shall be applied first to the payment of amounts then due and owing by the Borrower to the Secured Parties under the Program Documents (other than in respect of principal and Yield on Advances) and then to the reduction of the outstanding principal balance of the Advances.
SECTION 2.08. Increased Costs.
(a) If, due to either (i) the introduction of or any change (other than any change by way of imposition or increase of reserve requirements reflected in the Eurodollar Rate Reserve Percentage) in or in the interpretation of any Applicable Law, (ii) the compliance with any guideline or request from any central bank or other Authority (whether or not having the force of law), or (iii) the compliance, whether commenced prior to or after the Closing Date, by any Affected Person with the final rule titled Risk-Based Capital Guidelines; Capital Adequacy Guidelines; Capital Maintenance: Regulatory Capital; Impact of Modifications to Generally Accepted Accounting Principles; Consolidation of Asset-Backed Commercial Paper Programs; and Other Related Issues, adopted by the United States bank regulatory agencies on December 15, 2009, or any rules or regulations promulgated in connection therewith by any such agency or any authority (including, without limitation, any applicable non U.S. agencies or authorities) there shall be any increase in the cost to any Affected Person of agreeing to make or making, funding or maintaining any Advances to the Borrower, or agreeing to purchase or purchasing any such Advances from a Conduit Lender, then the Borrower shall from time to time, upon demand by such Affected Person pay to the Agent for the account of such Affected Person additional amounts sufficient to compensate such Affected Person for such increased cost. A certificate as to the amount of such increased cost, submitted to the Borrower by an Affected Person, shall be conclusive and binding for all purposes, absent manifest error.
(b) If an Affected Person determines that compliance with any Applicable Law or request from any central bank or other Authority charged with the interpretation or administration thereof (whether or not having the force of law) or the occurrence of any Accounting Based Consolidation Event after the Closing Date (regardless of whether the date of such Accounting Based Consolidation Event is before or after the Closing Date) or the compliance, whether commenced prior to or after the Closing Date, by any Affected Person with the final rule titled Risk-Based Capital Guidelines; Capital Adequacy Guidelines; Capital Maintenance: Regulatory Capital; Impact of Modifications to Generally Accepted Accounting Principles; Consolidation of Asset-Backed Commercial Paper Programs; and Other Related Issues, adopted by the United States bank regulatory agencies on December 15, 2009, or any rules or regulations promulgated in connection therewith by any such agency or any authority (including, without limitation, any applicable non U.S. agencies or authorities) (i) affects or would affect the amount of capital required or reasonably expected to be maintained by such Affected Person and that the amount of such capital is increased by or based upon the existence of such Affected Person’s commitment to make, fund or maintain Advances to the Borrower or to purchase such Advances from a Conduit Lender or upon such Affected Person’s making, funding, maintaining or purchasing Advances to the Borrower, (ii) increases the cost to any Affected Person for (A) making, funding or maintaining Advances to the Borrower, (B) purchasing Advances to the Borrower from a Conduit Lender, (C) committing to make, fund or maintain Advances to the Borrower, or (D) committing to purchase Advances to the Borrower from a Conduit Lender, or (iii) reduces the return of an Affected Person for (A) making, funding, or maintaining Advances to the Borrower, (B) purchasing Advances to the Borrower from a Conduit Lender, (C) committing to make, fund or maintain Advances to the Borrower, or (D) committing to purchase Advances to the Borrower from a Conduit Lender, then, upon written demand of such Affected Person (with a copy of such demand to the Agent), the Borrower shall
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immediately pay to the Agent for the account of such Affected Person, from time to time as specified by such Affected Person, additional amounts sufficient to compensate such Affected Person for such increased cost and/or reduced return in light of such circumstances. A certificate setting forth in reasonable detail such amounts and the circumstances giving rise thereto submitted to the Borrower by such Affected Person shall be conclusive and binding for all purposes, absent manifest error.
(c) The Affected Person agrees to use reasonable efforts to advise the Borrower promptly of the occurrence of any circumstances giving rise to a claim for reimbursement pursuant to the foregoing Sections 2.08(a) or 2.08(b), but the failure to do so shall not affect or impair the Borrower’s obligations thereunder. The Affected Person further agrees that amounts payable as specified in Sections 2.08(a) or 2.08(b) by the Borrower specified in any certificate referenced in Sections 2.08(a) and 2.08(b) shall be limited to amounts accrued or incurred by such Affected Person during the one hundred and eighty (180) day period preceding the Affected Person’s delivery to the Borrower of such certificate.
(d) Upon the occurrence of any event giving rise to the Borrower's obligation to pay additional amounts to an Affected Person pursuant to clauses (a) or (b) of this Section 2.08, such Affected Person will, if requested by the Borrower, use reasonable efforts (subject to overall policy considerations of an Affected Person) to designate a different lending office if such designation would reduce or obviate the obligations of the Borrower to make future payments of such additional amounts; provided, however, that such designation is made on such terms that such Affected Person and its lending office suffer no significant economic, legal or regulatory disadvantage, with the object of avoiding future consequences of the event giving rise to the operation of any such provision. If such increased costs are not eliminated by any such designation and the applicable Affected Person does not waive payment of such additional amounts, the Agent, may at its sole discretion within sixty (60) days, recommend to the Borrower a replacement Lender or Secondary Lender, as the case may be, not so affected. If after the sixty (60) day period described in the preceding sentence a replacement Lender or Secondary Lender, as the case may be, has not been procured, the Borrower may propose a replacement Lender or Secondary Lender, as the case may be, not so affected and, upon approval of the Agent, the Affected Person shall assign its interests hereunder to such a replacement Lender or Secondary Lender, as the case may be. The parties hereby agree that unless and until the Affected Person to be replaced (i) is paid in full for all amounts due and owing hereunder and under any other Program Document, and (ii) enters into assignment documents with the replacement Lender or Secondary Lender, as the case may be, which are reasonably satisfactory to such Affected Person, it shall have no obligation to assign any of its rights and interests hereunder. Each such Affected Person agrees to take all actions necessary to permit a replacement to succeed to its rights and obligations hereunder. The Borrower agrees to pay all reasonable expenses incurred by the Affected Person in utilizing another lending office of the Affected Person or in assigning its interest pursuant to this Section 2.08(d). Nothing in this Section 2.08(d) shall affect or postpone any of the obligations of the Borrower or the rights of the Affected Person elsewhere herein.
(e) If any event or circumstance gives rise to, or is reasonably expected to give rise to, an increase in the amount of capital required to be maintained by any Affected Person in respect of such Affected Person's commitment under the Program Documents or upon such Affected Person’s making, funding or maintaining any Advances, the Borrower shall at the request of the Agent, and at the sole cost and expense of the Borrower (i) provide each of the Rating Agencies with all such information and documents relating to the Facility (as defined in Section 9.09(a)), the Program Documents and the Pledged Collateral as shall be necessary to
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obtain from the Rating Agencies such ratings for the Program as are necessary to reduce the amount of capital required or proposed to be required to be maintained by such Affected Person (the "Requisite Ratings"), (ii) cooperate with the Rating Agencies’ review of the Facility and the Program Documents in connection with obtaining the Requisite Ratings, (iii) negotiate in good faith such amendments to the Program Documents as shall be necessary to obtain the Requisite Ratings for the Facility, and (iv) take such other action as shall be reasonably requested by the Agent to reduce or to avoid such increased capital charges to be maintained or expected to be maintained by such Affected Person.
(f) Failure or delay on the part of an Affected Person to demand compensation pursuant to this Section 2.08 shall not constitute a waiver of such Affected Person’s right to demand such compensation.
(g) For the avoidance of doubt, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 and all requests, rules, guidelines or directives thereunder or issued in connection therewith, (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III and (z) any interpretation of Statement of Financial Accounting Standards Nos. 166 and 167 by the Financial Accounting Standards Board, in each case, shall constitute an adoption, change, request or directive occurring after the date hereof and subject to Section 2.08.
SECTION 2.09. Compensation.
The Borrower shall compensate each Affected Person, upon its written request (which request shall set forth the basis for requesting such amounts), for all reasonable losses, expenses and liabilities (including, without limitation, any interest paid by such Affected Person to lenders of funds borrowed by it to make or carry its Eurodollar Rate Advances and any loss sustained by such Affected Person in connection with the re-employment of such funds), which such Affected Person may sustain: (i) if for any reason (other than a default by such Affected Person) a borrowing of any Eurodollar Rate Advance by the Borrower does not occur on a date specified therefor in the Notice of Borrowing (whether or not withdrawn), (ii) without duplication of any amounts payable in respect of any Liquidation Fee, if any payment or prepayment or conversion of any of the Borrower's Eurodollar Rate Advances occurs on a date which is not the last day of a Settlement Period applicable thereto, (iii) if any payment or prepayment or conversion of any of the Borrower's Eurodollar Rate Advances is not made on any date specified in a notice of prepayment given by the Borrower, or (iv) as a consequence of any other default by the Borrower to repay its Eurodollar Rate Advances when required by the terms of this Agreement.
SECTION 2.10. Additional Yield on Eurodollar Rate Advances.
So long as any Affected Person shall be required under regulations of the Board of Governors of the Federal Reserve System to maintain reserves with respect to liabilities or assets consisting of or including Eurocurrency Liabilities, the Borrower shall pay to such Affected Person Eurodollar Additional Yield on the principal amount of each outstanding Eurodollar Rate Advance on each date on which Yield is payable on such Eurodollar Rate Advance. Such Eurodollar Additional Yield shall be determined by such Affected Person and notified to the Borrower through the Agent within thirty (30) days after the date any payment is made with respect to which such additional Yield is requested. A certificate as to such Eurodollar Additional Yield submitted to the Borrower and the Agent shall be conclusive and binding for all purposes, absent manifest error.
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SECTION 2.11. Termination or Reduction of the Total Commitment.
The Borrower may at any time, upon ten (10) days’ prior written notice to the Agent terminate in whole or reduce in part the unused portion of the Total Commitment; provided, that each such partial reduction of the Total Commitment shall be in an amount equal to at least $ or an integral multiple thereof.
SECTION 2.12. Rescission or Return of Payment.
The Borrower further agrees that, if at any time all or any part of any payment theretofore made by it to any Secured Party or their designees is or must be rescinded or returned for any reason whatsoever (including, without limitation, the insolvency, bankruptcy or reorganization of the Borrower or any of its Affiliates), the obligation of the Borrower to make such payment to such Secured Party shall, for the purposes of this Agreement, to the extent that such payment is or must be rescinded or returned, be deemed to have continued in existence and this Agreement shall continue to be effective or be reinstated, as the case may be, as to such obligations, all as though such payment had not been made.
SECTION 2.13. Fees Payable by Borrower.
The Borrower agrees to pay the Agent such fees as are set forth in the Fee Letter.
SECTION 2.14. Post Default Interest.
The Borrower hereby promises to pay interest on the unpaid principal amount of each Advance and any other Borrower Obligation payable by the Borrower, in each case, which shall not be paid in full when due, for the period commencing on the due date thereof until but not including the date the same is paid in full at the Post-Default Rate. Interest payable at the Post-Default Rate shall be payable on the Agent’s demand.
SECTION 2.15. Payments.
(a) All amounts owing and payable to any Secured Party, any Affected Person or an Indemnified Party in respect of the Advances and other Borrower Obligations, including, without limitation, the principal thereof, Yield, fees, indemnities, expenses or other amounts payable under the Program Documents, shall be paid in Dollars, in immediately available funds on or prior to 12:00 p.m. (New York City time) on the date due without counterclaim, setoff, deduction, defense, abatement, suspension or deferment. Any payment paid after 12:00 p.m. (New York City time) on any day shall be deemed to have been made on the next Business Day for all purposes of this Agreement.
(b) All computations of interest at the Post-Default Rate and all computations of Yield, fees and other Borrower Obligations shall be made on the basis of a year of 360 days for the actual number of days elapsed. Whenever any payment or deposit to be made hereunder shall be due on a day other than a Business Day, such payment or deposit shall be made on the next succeeding Business Day and such extension of time shall be included in the computation of such payment or deposit.
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(c) Except as otherwise expressly provided in this Agreement, upon receipt of funds deposited into the Agent's Account, the Agent shall distribute such funds, first to the Lenders and the Secondary Lenders in payment in full of all accrued and unpaid Yield owing to the Lenders and Secondary Lenders, second to the Lenders, the Secondary Lenders or the Agent in payment of any other fees or other amounts owed by the Borrower to the Lenders, the Secondary Lenders and the Agent under this Agreement and the other Program Documents (other than in respect of the principal amount of the Advances), third to the payment of the principal amount of the Advances, and fourth to the Secured Parties on a pro rata basis in accordance with the amounts owed to each such Person.
(d) During the continuance of an Event of Default all payments in respect of the Borrower Obligations, payable by or on behalf of the Borrower, including all Proceeds resulting from the sale or disposition of the Pledged Collateral shall be remitted to the Agent's Account and applied in accordance with Section 7.03(a).
SECTION 2.16. Ratable Payments.
If any Secondary Lender or Lender (other than a Conduit Lender), whether by set-off, bankers' lien, counterclaim or otherwise, has payment made to it with respect to any Borrower Obligations owing to it in a greater proportion than that received by any other Lender or Secondary Lender entitled to receive a ratable share of such payments, such Lender or Secondary Lender agrees, promptly upon demand, to purchase for cash without recourse or warranty a portion of the unpaid Borrower Obligations held by the other Lenders and Secondary Lenders so that after such purchase each Lender and Secondary Lender will hold its ratable proportion of such unpaid Borrower Obligations; provided that if all or any portion of such excess amount is thereafter recovered from such Secondary Lender or Lender, as the case may be, such purchase shall be rescinded and the purchase price restored to the extent of such recovery, but without interest.
SECTION 2.17. Borrower’s Obligations Absolute.
The Borrower’s obligations under this Agreement and under the other Program Documents shall be absolute, unconditional and irrevocable, and shall be paid strictly in accordance with the terms hereof and thereof, under any and all circumstances and irrespective of any setoff, counterclaim or defense to payment which the Borrower, the Adviser or any other Person may have or have had against any Secured Party or any other Person.
SECTION 2.18. Right of Set-off.
If an Event of Default shall have occurred and be continuing, each Conduit Lender and each Secondary Lender and each of its respective Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by applicable law, to set off and apply any and all deposits (general or special, time or demand, provisional or final, in whatever currency) at any time held and other obligations (in whatever currency) at any time owing by such Conduit Lender or such Secondary Lender or any such Affiliate to or for the credit or the account of the Borrower against any and all of the Borrower Obligations now or hereafter existing to such Conduit Lender or such Secondary Lender, as the case may be, irrespective of whether or not such Conduit Lender or such Secondary Lender shall have made any demand under this Agreement or any other Program Document and although such obligations of the Borrower may be contingent or unmatured or are owed to a branch or office of such Conduit
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Lender or such Secondary Lender different from the branch or office holding such deposit or obligated on such indebtedness. The rights of each Conduit Lender and each Secondary Lender and its respective Affiliates under this Section 2.18 are in addition to other rights and remedies (including other rights of set-off) that such Conduit Lender and such Secondary Lender or its respective Affiliates may have. Each Conduit Lender and each Secondary Lender agrees to notify the Borrower and the Agent promptly after any such set-off and application, provided that the failure to give such notice shall not affect the validity of such set-off and application.
SECTION 2.19. Non-Receipt of Funds by the Agent.
(a) If the Agent shall have received notice in accordance with Section 2.02 that each Conduit Lender has declined to make any proposed Advance, then unless the Agent shall have received notice from a Secondary Lender prior to an applicable Borrowing Date that such Secondary Lender will not make available to the Agent such Secondary Lender’s share of the Requested Amount to be funded on such Borrowing Date, the Agent may assume that such Secondary Lender has made such share available on such date in accordance with Section 2.02 and may, in reliance upon such assumption, make available to the Borrower a corresponding amount. In such event, if a Secondary Lender has not in fact made its share of the applicable borrowing available to the Agent, then the applicable Secondary Lender and the Borrower severally agree to pay to the Agent forthwith on demand such corresponding amount with interest thereon, for each day from and including the date such amount is made available to the Borrower to but excluding the date of payment to the Agent, at (i) in the case of a payment to be made by such Secondary Lender, the greater of the Federal Funds Rate and a rate determined by the Agent in accordance with banking industry rules on interbank compensation, and (ii) in the case of a payment to be made by the Borrower, the Assignee Rate. If the Borrower and such Secondary Lender shall pay such interest to the Agent for the same or an overlapping period, the Agent shall promptly remit to the Borrower the amount of such interest paid by the Borrower for such period. If such Secondary Lender pays its share of the applicable borrowing to the Agent, then the amount so paid shall constitute such Secondary Lender’s Advance included in such borrowing. Any payment by the Borrower shall be without prejudice to any claim the Borrower may have against a Secondary Lender that shall have failed to make such payment to the Agent.
(b) Unless the Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Agent for the account of the Secondary Lenders hereunder that the Borrower will not make such payment, the Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Secondary Lenders, as the case may be, the amount due. In such event, if the Borrower has not in fact made such payment, then each of the Secondary Lenders severally agrees to repay to the Agent forthwith on demand the amount so distributed to such Secondary Lender, with interest thereon, for each day from and including the date such amount is distributed to it but excluding the date of payment to the Agent, at the greater of the Federal Funds Rate and a rate determined by the Agent in accordance with banking industry rules on interbank compensation.
SECTION 2.20. Effect of Benchmark Replacement Event.6
(a) Benchmark Replacement.
6 Amendment No. 2; Amendment No. 5
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Notwithstanding anything to the contrary herein or in any other Program Document, if a Benchmark Transition Event or an Early Opt-in Election, as applicable, and its related Benchmark Replacement Date have occurred prior to the Reference Time in respect of any setting of the then-current Benchmark, then, (x) if a Benchmark Replacement is determined in accordance with clause (1) or (2) of the definition of “Benchmark Replacement” for such Benchmark Replacement Date, in connection with a Benchmark Transition Event, such Benchmark Replacement will replace such Benchmark for all purposes hereunder and under any Program Document in respect of such Benchmark setting and subsequent Benchmark settings without any amendment to, or further action or consent of any other party to, this Agreement or any other Program Document and (y) if a Benchmark Replacement is determined in accordance with clause (3) of the definition of “Benchmark Replacement” for such Benchmark Replacement Date, or in connection with an Early Opt-in Election, such Benchmark Replacement will replace such Benchmark for all purposes hereunder and under any Program Document in respect of any Benchmark setting at or after 5:00 p.m. (New York City time) on the fifth (5th) Business Day after the date notice of such Benchmark Replacement is provided to the Borrower without any amendment to this Agreement or any other Program Document, or further action or consent of the Borrower, so long as the Agent has not received, by such time, written notice of objection to such Benchmark Replacement from the Borrower.
If (i) a Benchmark Replacement Date has occurred and the applicable Benchmark Replacement on such Benchmark Replacement Date is a Benchmark Replacement other than the sum of: (a) Term SOFR and (b) the related Benchmark Replacement Adjustment, (ii) subsequently, the Relevant Governmental Body recommends for use a forward-looking term rate based on SOFR and the Borrower requests that the Agent review the administrative feasibility of such recommended forward-looking term rate for purposes of this Agreement and (iii) following such request from the Borrower, the Agent determines (in its sole discretion) that such forward looking term rate is administratively feasible for the Agent, then the Agent may (in its sole discretion) provide the Borrower with written notice that from and after a date identified in such notice: (i) a Benchmark Replacement Date shall be deemed to have occurred, the Benchmark Replacement on such Benchmark Replacement Date shall be deemed to be a Benchmark Replacement determined in accordance with clause (1) of the definition of “Benchmark Replacement” under this Section 2.20; provided, however, that if upon such Benchmark Replacement Date the Benchmark Replacement Adjustment is unable to be determined in accordance with clause (1) of the definition of “Benchmark Replacement” and the corresponding definition of “Benchmark Replacement Adjustment”, then the Benchmark Replacement Adjustment in effect immediately prior to such new Benchmark Replacement Date shall be utilized for purposes of this Benchmark Replacement (for the avoidance of doubt, for purposes of this proviso, such Benchmark Replacement Adjustment shall be the Benchmark Replacement Adjustment which was established in accordance with the definition of “Benchmark Replacement Adjustment” on the date determined in accordance with clauses (1) or (2), as applicable, of the definition of “Benchmark Replacement Date” hereunder) and (ii) such forward looking term rate shall be deemed to be the forward looking term rate referenced in the definition of “Term SOFR” for all purposes hereunder or under any Program Document in respect of any Benchmark setting and any subsequent Benchmark settings, without any amendment to, or further action or consent of any other party to, this Agreement or any other Program Document. For the avoidance of doubt, if the circumstances described in the immediately preceding sentence shall occur, all applicable provisions set forth in this Section 2.21 shall apply with respect to such election of the Agent as completely as if such forward-looking term rate was initially determined in accordance with clause (1) of the definition of “Benchmark Replacement”, including, without limitation, the provisions set forth in clauses (b) and (f) of this Section 2.20.
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(b) Benchmark Replacement Conforming Changes.
In connection with the implementation of a Benchmark Replacement, the Agent will have the right to make Benchmark Replacement Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Program Document, any amendments implementing such Benchmark Replacement Conforming Changes will become effective without any further action or consent of the Borrower.
(c) Notices; Standards for Decisions and Determinations.
The Agent will promptly notify the Borrower of (i) any Benchmark Replacement Date and the related Benchmark Replacement, (ii) the effectiveness of any Benchmark Replacement Conforming Changes, (iii) the removal or reinstatement of any tenor of a Benchmark pursuant to clause (d) below and (iv) the commencement of any Benchmark Unavailability Period. For the avoidance of doubt, any notice required to be delivered by the Agent as set forth in this Section 2.20 may be provided, at the option of the Agent (in its sole discretion), in one or more notices and may be delivered together with, or as part of any amendment which implements any Benchmark Replacement or Benchmark Conforming Changes. Any determination, decision or election that may be made by the Agent pursuant to this Section 2.20 including any determination with respect to a tenor, rate or adjustment or of the occurrence or non-occurrence of an event, circumstance or date and any decision to take or refrain from taking any action or any selection, will be conclusive and binding absent manifest error and may be made in its sole discretion and without consent from the Borrower, except, in each case, as expressly required pursuant to this Section 2.20.
(d) Unavailability of Tenor of Benchmark.
Notwithstanding anything to the contrary herein or in any other Program Document, at any time (including in connection with the implementation of a Benchmark Replacement), (i) if the then-current Benchmark is a term rate (including Term SOFR or USD LIBOR) and either (A) any tenor for such Benchmark is not displayed on a screen or other information service that publishes such rate from time to time as selected by the Agent in its reasonable discretion or (B) the regulatory supervisor for the administrator of such Benchmark has provided a public statement or publication of information announcing that any tenor for such Benchmark is or will be no longer representative, then the Agent may modify the definition of “Settlement Period” for any Benchmark settings at or after such time to remove such unavailable or non-representative tenor and (ii) if a tenor that was removed pursuant to clause (i) above either (A) is subsequently displayed on a screen or information service for a Benchmark (including a Benchmark Replacement) or (B) is not, or is no longer, subject to an announcement that it is or will no longer be representative for a Benchmark (including a Benchmark Replacement), then the Agent may modify the definition of “Settlement Period” for all Benchmark settings at or after such time to reinstate such previously removed tenor.
(e) Benchmark Unavailability Period.
Upon the Borrower’s receipt of notice of the commencement of a Benchmark Unavailability Period, the Borrower may revoke any request for a borrowing of, conversion to or continuation of Eurodollar Rate Advance to be made, converted or continued during any Benchmark Unavailability Period and, failing that, the Borrower will be deemed to have converted any such request into a request for a borrowing of or conversion to Alternate Base Rate Advances.
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(f) Disclaimer.
The Agent does not warrant or accept any responsibility for, and shall not have any liability with respect to (i) the administration, submission or any other matter related to the London interbank offered rate or other rates in the definition of “Eurodollar Rate” or with respect to any alternative or successor rate thereto, or replacement rate thereof (including, without limitation any Benchmark Replacement implemented hereunder), (ii) the composition or characteristics of any such Benchmark Replacement, including whether it is similar to, or produces the same value or economic equivalence to USD LIBOR (or any other Benchmark) or has the same volume or liquidity as did USD LIBOR (or any other Benchmark), (iii) any actions or use of its discretion or other decisions or determinations made with respect to any matters covered by this Section 2.20 including, without limitation, whether or not a Benchmark Transition Event has occurred, the removal or lack thereof of unavailable or non-representative tenors, the implementation or lack thereof of any Benchmark Replacement Conforming Changes, the delivery or non-delivery of any notices required by clause (c) above or otherwise in accordance herewith, and (iv) the effect of any of the foregoing provisions of this Section 2.20.
(g) Certain Defined Terms. As used in this Agreement:
“Available Tenor” means, as of any date of determination and with respect to the then-current Benchmark, as applicable, any tenor for such Benchmark or payment period for interest calculated with reference to such Benchmark, as applicable, that is or may be used for determining the length of a Settlement Period pursuant to this Agreement as of such date and not including, for the avoidance of doubt, any tenor for such Benchmark that is then-removed from the definition of “Settlement Period” pursuant to clause (d) of this Section 2.20.
“Benchmark” means, initially, USD LIBOR; provided that if a Benchmark Transition Event or an Early Opt-in Election, as applicable, and its related Benchmark Replacement Date have occurred with respect to USD LIBOR or the then-current Benchmark, then “Benchmark” means the applicable Benchmark Replacement to the extent that such Benchmark Replacement has replaced such prior benchmark rate pursuant to clause (a) of this Section 2.20.
“Benchmark Replacement” means, for any Available Tenor, the first alternative set forth in the order below that can be determined by the Agent for the applicable Benchmark Replacement Date:
(1) the sum of: (a) Term SOFR and (b) the related Benchmark Replacement Adjustment;
(2) the sum of: (a) Daily Simple SOFR and (b) the related Benchmark Replacement Adjustment;
(3) the sum of: (a) the alternate benchmark rate that has been selected by the Agent as the replacement for the then-current Benchmark for the applicable Corresponding Tenor giving due consideration to (i) any selection or recommendation of a replacement benchmark rate or the mechanism for determining such a rate by the Relevant Governmental Body or (ii) any evolving or then-prevailing market convention for determining a benchmark rate as a replacement for the then-current Benchmark for Dollar-denominated syndicated or bilateral credit facilities at such time and (b) the related Benchmark Replacement Adjustment; provided that, in the case of clause (1), such Unadjusted Benchmark Replacement is displayed on a screen or other information service that publishes such rate from time to time as selected by the Agent in its reasonable discretion.
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If the Benchmark Replacement as determined pursuant to clause (1), (2) or (3) above would be less than the Floor, the Benchmark Replacement will be deemed to be the Floor for the purposes of this Agreement and the other Program Documents.
“Benchmark Replacement Adjustment” means, with respect to any replacement of the then current Benchmark with an Unadjusted Benchmark Replacement for any applicable Settlement Period and Available Tenor for any setting of such Unadjusted Benchmark Replacement:
(1) for purposes of clauses (1) and (2) of the definition of “Benchmark Replacement,” the first alternative set forth in the order below that can be determined by the Agent: (a) the spread adjustment, or method for calculating or determining such spread adjustment, (which may be a positive or negative value or zero) as of the Reference Time such Benchmark Replacement is first set for such Settlement Period that has been selected or recommended by the Relevant Governmental Body for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement for the applicable Corresponding Tenor; (b) the spread adjustment (which may be a positive or negative value or zero) as of the Reference Time such Benchmark Replacement is first set for such Settlement Period that would apply to the fallback rate for a derivative transaction referencing the ISDA Definitions to be effective upon an index cessation event with respect to such Benchmark for the applicable Corresponding Tenor; and
(2) for purposes of clause (3) of the definition of “Benchmark Replacement,” the spread adjustment, or method for calculating or determining such spread adjustment, (which may be a positive or negative value or zero) that has been selected by the Agent for the applicable Corresponding Tenor giving due consideration to (i) any selection or recommendation of a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement by the Relevant Governmental Body on the applicable Benchmark Replacement Date or (ii) any evolving or then-prevailing market convention for determining a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement for Dollar denominated syndicated or bilateral credit facilities; provided that, in the case of clause (1) above, such adjustment is displayed on a screen or other information service that publishes such Benchmark Replacement Adjustment from time to time as selected by the Agent in its reasonable discretion.
“Benchmark Replacement Conforming Changes” means, with respect to any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definition of “Alternate Base Rate,” the definition of “Business Day,” the definition of “Settlement Period,” timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment, conversion or continuation notices, length of lookback periods, the applicability of breakage provisions, the formula for calculating any successor rates identified pursuant to the definition of “Benchmark Replacement”, the formula, methodology or convention for applying the successor Floor to the successor Benchmark Replacement and other technical, administrative or operational matters) that the Agent decides may be appropriate to reflect the adoption and implementation of such Benchmark Replacement and to permit the administration thereof by the Agent in a manner substantially consistent with market practice (or, if the Agent decides that adoption of any portion of such market practice is not administratively feasible or if the Agent determines that no market practice for the administration of such Benchmark Replacement exists, in such other manner of administration as the Agent decides is reasonably necessary in connection with the administration of this Agreement and the other Program Documents).
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“Benchmark Replacement Date” means the earliest to occur of the following events with respect to the then-current Benchmark:
(1) in the case of clause (1) or (2) of the definition of “Benchmark Transition Event,” the later of (a) the date of the public statement or publication of information referenced therein and (b) the date on which the administrator of such Benchmark (or the published component used in the calculation thereof) permanently or indefinitely ceases to provide all Available Tenors of such Benchmark (or such component thereof);
(2) in the case of clause (3) of the definition of “Benchmark Transition Event,” the date of the public statement or publication of information referenced therein; or
(3) in the case of an Early Opt-in Election, the sixth (6th) Business Day after the date notice of such Early Opt-in Election is provided to the Borrower, so long as the Agent has not received, by 5:00 p.m. (New York City time) on the fifth (5th) Business Day after the date notice of such Early Opt-in Election is provided to the Borrower, written notice of objection to such Early Opt-in Election from the Borrower.
For the avoidance of doubt, (i) if the event giving rise to the Benchmark Replacement Date occurs on the same day as, but earlier than, the Reference Time in respect of any determination, the Benchmark Replacement Date will be deemed to have occurred prior to the Reference Time for such determination and (ii) the “Benchmark Replacement Date” will be deemed to have occurred in the case of clause (1) or (2) with respect to any Benchmark upon the occurrence of the applicable event or events set forth therein with respect to all then-current Available Tenors of such Benchmark (or the published component used in the calculation thereof).
“Benchmark Transition Event” means the occurrence of one or more of the following events with respect to the then-current Benchmark:
(1) a public statement or publication of information by or on behalf of the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that such administrator has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof), permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof);
(2) a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof), the Board of Governors of the Federal Reserve System, the Federal Reserve Bank of New York, an insolvency official with jurisdiction over the administrator for such Benchmark (or such component), a resolution authority with jurisdiction over the administrator for such Benchmark (or such component) or a court or an entity with similar insolvency or resolution authority over the administrator for such Benchmark (or such component), which states that the administrator of such Benchmark (or such component) has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof) permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof); or
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(3) a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that all Available Tenors of such Benchmark (or such component thereof) are no longer representative.
For the avoidance of doubt, a “Benchmark Transition Event” will be deemed to have occurred with respect to any Benchmark if a public statement or publication of information set forth above has occurred with respect to each then-current Available Tenor of such Benchmark (or the published component used in the calculation thereof).
“Benchmark Unavailability Period” means the period (if any) (x) beginning at the time that a Benchmark Replacement Date pursuant to clauses (1) or (2) of that definition has occurred if, at such time, no Benchmark Replacement has replaced the then-current Benchmark for all purposes hereunder and under any Program Document in accordance with this Section 2.20 and (y) ending at the time that a Benchmark Replacement has replaced the then-current Benchmark for all purposes hereunder and under any Program Document in accordance with this Section 2.20.
“Corresponding Tenor” with respect to any Available Tenor means, as applicable, either a tenor (including overnight) or an interest payment period having approximately the same length (disregarding business day adjustment) as such Available Tenor.
“Daily Simple SOFR” means, for any day, SOFR, with the conventions for this rate (which will include a lookback) being established by the Agent in accordance with the conventions for this rate selected or recommended by the Relevant Governmental Body for determining “Daily Simple SOFR” for business loans; provided, that if the Agent decides that any such convention is not administratively feasible for the Agent, then the Agent may establish another convention in its reasonable discretion.
“Early Opt-in Election” means, if the then-current Benchmark is USD LIBOR, the occurrence of the following:
(1) a determination by the Agent that at least five currently outstanding Dollar-denominated syndicated or bilateral credit facilities in the U.S. syndicated or bilateral loan market at such time contain (as a result of amendment or as originally executed) a SOFR-based rate (including SOFR, a term SOFR or any other rate based upon SOFR) as a benchmark rate (and such credit facilities are identified in the notice to the Borrower described in clause (2) below and are publicly available for review), and
(2) the election by the Agent to trigger a fallback from USD LIBOR and the provision by the Agent of written notice of such election to the Borrower.
“Floor” means the benchmark rate floor, if any, provided in this Agreement initially (as of the execution of this Agreement, the modification, amendment or renewal of this Agreement or otherwise) with respect to USD LIBOR.
“ISDA Definitions” means the 2006 ISDA Definitions published by the International Swaps and Derivatives Association, Inc. or any successor thereto, as amended or supplemented from time to time, or any successor definitional booklet for interest rate derivatives published from time to time by the International Swaps and Derivatives Association, Inc. or such successor thereto.
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“Reference Time” with respect to any setting of the then-current Benchmark means (1) if such Benchmark is USD LIBOR, 11:00 a.m. (London time) on the day that is two London banking days preceding the date of such setting, and (2) if such Benchmark is not USD LIBOR, the time determined by the Agent in its reasonable discretion.
“Relevant Governmental Body” means the Board of Governors of the Federal Reserve System or the Federal Reserve Bank of New York, or a committee officially endorsed or convened by the Board of Governors of the Federal Reserve System or the Federal Reserve Bank of New York, or any successor thereto.
“SOFR” means, with respect to any Business Day, a rate per annum equal to the secured overnight financing rate for such Business Day published by the SOFR Administrator on the SOFR Administrator’s Website on the immediately succeeding Business Day.
“SOFR Administrator” means the Federal Reserve Bank of New York (or a successor administrator of the secured overnight financing rate).
“SOFR Administrator’s Website” means the website of the Federal Reserve Bank of New York, currently at http://www.newyorkfed.org, or any successor source for the secured overnight financing rate identified as such by the SOFR Administrator from time to time.
“Term SOFR” means, for the applicable Corresponding Tenor as of the applicable Reference Time, the forward-looking term rate based on SOFR that has been selected or recommended by the Relevant Governmental Body.
“Unadjusted Benchmark Replacement” means the applicable Benchmark Replacement excluding the related Benchmark Replacement Adjustment.
“USD LIBOR” means the London interbank offered rate for Dollars.
Article
III
CONDITIONS PRECEDENT
SECTION 3.01. [INTENTIONALLY OMITTED]
SECTION 3.02. Conditions Precedent to All Advances.
The obligation of the Conduit Lenders and the Secondary Lenders to make any Advance (including the initial Advance) on any Borrowing Date shall be subject to the fulfillment of the following conditions:
(a) each of the representations and warranties of the Borrower, the Custodian and the Adviser contained in this Agreement, the Control Agreement, the Letter Agreement and the other Program Documents shall be true and correct as of such date and shall continue to be true immediately after giving effect to such Advance;
(b) no Default or Event of Default shall have occurred and be continuing at or prior to the time of the making of such Advance or shall result from the making of such Advance;
(c) the conditions precedent set forth in Section 3.03 shall have been fully satisfied;
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(d) immediately after giving effect to such Advance and all other Advances to be made on such date the Borrower shall be in full compliance with each of the Borrowing Base Test and the Asset Coverage Test;
(e) immediately after the making of any such Advance and all other Advances to be made on such date, the aggregate outstanding principal amount of all Advances shall not exceed the Total Commitment;
(f) the Agent shall have received a pro-forma Investor Report, which shall evidence compliance with the terms of this Agreement after giving effect to all borrowings on such Borrowing Date;
(g) the aggregate credit extended by the Lenders and the Secondary Lenders in connection with this Agreement does not exceed the sum of (x) the Margin Stock Percentage of the current market value (as defined in Regulation U) of all Margin Stock of the Borrower, plus, (y) the good faith loan value (as determined in accordance with Regulation U) of all other Assets of the Borrower;
(h) with respect to (i) the initial Advance to the Borrower after the Restatement Effective Date, a Form FR G-3 and a Form FR U-1, each duly completed, executed and delivered by the Borrower specifying Pledged Collateral having a value sufficient, after giving effect to such initial borrowing, to comply with the requirements of Regulation U, and (ii) each subsequent Advance to the Borrower, an amendment to the Form FR G-3 and the Form FR U-1 previously delivered in accordance with the provisions of Section 221.3(c)(2)(iv) of Regulation U; and
(i) the Agent shall have received such other instruments, certificates and documents as the Agent shall have reasonably requested.
SECTION 3.03. Conditions Precedent to the Effectiveness of this Agreement on the Restatement Effective Date.
The effectiveness of this Agreement and the Conduit Lenders’ and the Secondary Lenders’ obligations hereunder shall be subject to the conditions precedent that the Agent shall have received on or before the Restatement Effective Date the following, each (unless otherwise indicated) in form and substance reasonably satisfactory to the Agent in sufficient copies for the Conduit Lenders and the Secondary Lenders:
(a) each of the Program Documents (other than any Loan Documents) duly executed and delivered by the parties thereto, which shall be in full force and effect;
(b) the Prospectus, as in effect on the Restatement Effective Date;
(c) a certificate of a Responsible Officer of the Borrower certifying that the Prospectus, as delivered pursuant to Section 3.01 of the Existing Credit Agreement, has not been modified since the Closing Date (other than any modifications in accordance with the provisions of the Existing Credit Agreement as in effect immediately preceding the Restatement Effective Date);
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(d) the signed opinions of counsel to the Borrower and the Adviser addressed to the Agent, each Conduit Lender and each Secondary Lender as to such matters as the Agent, each Conduit Lender and each Secondary Lender shall have reasonably requested;
(e) if requested by any Conduit Lender or any Secondary Lender pursuant to Section 2.03 on or prior to the Restatement Effective Date, an Advance Note duly executed and completed by the Borrower to such Conduit Lender or such Secondary Lender, as applicable;
(f) all Governmental Authorizations, Private Authorizations and Governmental Filings, if any, which may be required in connection with the transactions contemplated by the Program Documents;
(g) a certificate of a Responsible Officer of each of the Borrower and the Adviser certifying (i) as to its certificate of incorporation or declaration of trust, as applicable, and by-laws, together with all amendments thereto, (ii) as to the resolutions of its Board of Directors or Board of Trustees, as applicable, approving this Agreement and the other Program Documents to which it is a party (other than any Loan Documents) and the transactions contemplated hereby and thereby, (iii) that its representations and warranties set forth in the Program Documents (other than any Loan Documents) to which it is a party are true and correct, and (iv) the incumbency and specimen signature of each of its officers of the Borrower authorized to execute the Program Documents (other than any Loan Documents) to which it is a party and of each of its Responsible Officers for purposes of this Agreement;
(h) copies of proper financing statements or financing statement amendments under the UCC in all jurisdictions that the Agent may deem necessary or desirable in order to perfect the interests in the Pledged Collateral contemplated by this Agreement;
(i) copies of proper financing statements necessary to release all security interests and other rights of any Person in the Assets of the Borrower previously granted by the Borrower other than in accordance with the Existing Credit Agreement;
(j) completed requests for information, dated on or before the date of such initial Advance, listing the financing statements referred to in clause (i) above and all other effective financing statements filed in the jurisdictions referred to in subsection (h) above that name the Borrower (under its present name and any previous name) as debtor, together with copies of such other financing statements (none of which shall cover any Assets of the Borrower other than those filed in accordance with the Existing Credit Agreement);
(k) a pro-forma Investor Report, which shall evidence compliance with the terms of the Program Documents (other than the Loan Documents), including compliance with the Borrowing Base Test and the Asset Coverage Test, after giving effect to the initial borrowing of Advances under this Agreement after the Restatement Effective Date;
(l) the fees to be received by it on or prior to the Restatement Effective Date under the Fee Letter or otherwise; and
(m) such other instruments, certificates and documents from the Borrower and the Adviser as the Agent shall have reasonably requested, all in form and substance satisfactory to the Agent.
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Article
IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Borrower.
The Borrower represents and warrants to each of the Secured Parties on and as of the Restatement Effective Date, each Borrowing Date and each date that any Asset is credited to or removed from the Collateral Account (and in respect of clause (l) below, each date such information is provided), as follows:
(a) Due Organization. The Borrower is a Massachusetts business trust, duly organized, validly existing and in good standing under the laws of the Commonwealth of Massachusetts, with full power and authority to own and operate its assets and properties, conduct the business in which it is now engaged and to execute and deliver and perform its obligations under this Agreement and the other Program Documents to which it is a party.
(b) Due Qualification and Good Standing. The Borrower is duly qualified to do business and is in good standing in each jurisdiction in which the nature of its business, assets and properties, including, without limitation, the performance of its obligations under this Agreement and the other Program Documents, requires such qualification, except to the extent that the failure to be so qualified could not reasonably be expected to give rise to a Material Adverse Effect.
(c) Due Authorization; Execution and Delivery; Legal, Valid and Binding; Enforceability. The execution and delivery by the Borrower of, and the performance by the Borrower of its obligations under the Program Documents and the other instruments, certificates and agreements contemplated thereby are within its powers and have been duly authorized by all requisite action and have been duly executed and delivered by the Borrower and constitute the legal, valid and binding obligations of the Borrower enforceable against the Borrower in accordance with their respective terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors' rights generally and by general equitable principles (whether enforcement is sought by proceedings in equity or at law).
(d) Noncontravention. Neither the execution and delivery by the Borrower of this Agreement, the other Program Documents, or any instrument, certificate or agreement referred to herein or therein, or contemplated hereby or thereby, nor the consummation of the transactions herein or therein contemplated, nor compliance with the terms, conditions and provisions hereof or thereof by it, will (i) conflict with, or result in a breach or violation of, or constitute a default under its Declaration of Trust, By-laws or other organizational documents, (ii) conflict with, contravene or violate (A) any Applicable Law, the violation of which could reasonably give rise to a Material Adverse Effect, (B) any contractual restriction binding on or affecting the Borrower or any of its Assets, the violation of which could reasonably give rise to a Material Adverse Effect, or (C) any order, writ, judgment, award, injunction or decree binding on or affecting the Borrower or any of its Assets, (iii) result in a breach or violation of, or constitute a default under, or permit the acceleration of any obligation or liability in, or but for any requirement of the giving of notice or the passage of time (or both) would constitute such a conflict with, breach or violation of, or default under, or permit any such acceleration in, any contractual obligation or any agreement or document to which it is a party or by which it or any of its Assets or properties are bound (or to which any such obligation, agreement or document relates), or (iv) result in any Adverse Claim upon the Borrower or any of its Assets or properties.
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(e) Governmental Authorizations; Private Authorizations; Governmental Filings. The Borrower has obtained all necessary Governmental Authorizations and Private Authorizations, and made all Governmental Filings necessary for the execution and delivery by the Borrower of, and the performance by the Borrower of its obligations under this Agreement, the other Program Documents and the agreements, certificates and instruments contemplated hereby or thereby, and no Governmental Authorization, Private Authorization or Governmental Filing which has not been obtained or made, is required to be obtained or made by it in connection with the execution and delivery by the Borrower of, or the performance of its obligations under this Agreement and the other Program Documents.
(f) Security Interest. This Agreement and the Control Agreement and the actions required to be taken pursuant to the terms hereof and thereof are, and at all times shall be, effective to create and perfect in the Agent for the benefit of the Secured Parties a first priority perfected security interest in the Pledged Collateral (subject to the Lien of the Custodian securing the Custodian's Overdraft Advances to the extent permitted by Section 5.02(p)) free and clear of all Adverse Claims. Further, on and as of the Restatement Effective Date, each Borrowing Date and each date that any Asset is credited to or removed from the Collateral Account, the Borrower represents and warrants as to itself that each remittance of Borrower Obligations by the Borrower to the Secured Parties under or in connection with this Agreement shall be (i) a payment of a debt incurred by the Borrower in the ordinary course of business or financial affairs of the Borrower, and (ii) made in the ordinary course of business or financial affairs of the Borrower.
(g) Borrowing Base Eligible Assets, Adverse Claims, Etc. The Borrower owns each Borrowing Base Eligible Asset free and clear of Adverse Claims and the Agent has a first priority perfected security interest in the Pledged Collateral (subject to the Lien of the Custodian securing the Custodian's Overdraft Advances to the extent permitted by Section 5.02(p)) free and clear of all Adverse Claims and no actions, except as have been taken, are necessary or advisable to perfect or protect such security interest free and clear of Adverse Claims.
(h) No Financing Statement. No effective financing statements or other instruments similar in effect covering any Asset of the Borrower are on file in any recording office, except those filed in favor of the Agent pursuant to this Agreement.
(i) Principal Office; Organization. The Borrower's principal place of business and chief executive office is at the addresses referred to in Section 9.02, the Borrower’s jurisdiction of organization is the Commonwealth of Massachusetts and the Borrower has not transacted any business under any name other than "Eaton Vance Senior Income Trust". The state of the principal residence of each Trustee is accurately set forth on Schedule IV, as the same may be amended from time to time by notice to the Agent pursuant to Section 5.02(d).
(j) Pending Litigation or Other Proceeding. Except as set forth on Schedule 4.01(j) attached hereto, there are no pending or, to the best of the Borrower’s knowledge, threatened investigations, actions, suits or proceedings involving the Borrower which could give rise to a reasonable possibility of a Material Adverse Effect.
(k) Investment Company Act, Etc. The Borrower is and will continue to be registered as a closed-end diversified investment company as such term is used in the Investment Company Act and is in full compliance with the Investment Company Act and the Investment Policies and Restrictions.
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(l) Information and Reports. The Prospectus, each Investor Report, each Notice of Borrowing and all other written information, reports, certificates and statements (with respect to which, other than the Investor Report and each Notice of Borrowing, shall be taken as a whole) provided by or on behalf of the Borrower or the Adviser to any Secured Party for purposes of or in connection with this Agreement, the other Program Documents or the transactions contemplated hereby or thereby is, and all such information hereafter provided by or on behalf of the Borrower or the Adviser to any Secured Party is and will be true, correct and complete in all material respects on the date such information is stated or certified and no such information contains, or will contain, any material misrepresentation or any omission to state therein matters necessary to make the statements made therein not misleading in any material respect when considered in its entirety.
(m) Applicable Law. The Borrower is in full compliance with all Applicable Law, including, without limitation, the Securities Act and the Investment Company Act, including the rules and regulations promulgated thereunder.
(n) ERISA. The Borrower is not now nor has during the past five years been a member of an ERISA Group and does not have nor during the past five years had any liability or obligation with respect to any Plan, Multiemployer Plan or Benefit Arrangement.
(o) No Default or Event of Default. No Default or Event of Default has occurred and is continuing, and each of the conditions precedent to the making of Advances set forth in Section 3.02 are fully satisfied on each Borrowing Date and immediately after the making of each Advance.
(p) Borrowing Base Test; Asset Coverage Test, Etc. The Borrowing Base Test and the Asset Coverage Test are fully satisfied and will be fully satisfied immediately after the making of each Advance; provided, that if on any date this representation is made (other than a Borrowing Date) the Borrower is in full compliance with the requirements set forth in clauses (b) and (c) of Section 2.05, the Borrower shall be deemed to be in compliance with this clause (p) as of such date.
(q) Internal Revenue Code. The Borrower is a "regulated investment company" within the meaning of the Code, and will take all actions necessary to avoid having any more than a de minimis amount of its annual income subject to United States federal income or excise taxation.
(r) Taxes. The Borrower has filed all United States Federal income tax returns and all other tax returns which are required to be filed by it, if any, and has paid all taxes due pursuant to such returns, if any, or pursuant to any assessment received by the Borrower, except for any taxes or assessments which are being contested in good faith by appropriate proceedings and with respect thereto adequate reserves have been established in accordance with GAAP and the non-payment of which could otherwise not give rise to a reasonable possibility of a Material Adverse Effect and the charges, accruals and reserves on the books of the Borrower in respect of taxes or other governmental charges, if any, are, in the opinion of the Borrower, adequate.
(s) Financial Condition. Each financial statement delivered by the Borrower to the Agent in accordance with Section 5.01(e) fairly presents the financial condition of the Borrower in accordance with GAAP as of the date such balance sheets are stated or certified, and since the date that the first such financial statement was stated or certified there has been no material adverse change in the business, financial position, results of operations or prospects of the Borrower.
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(t) Regulations T, U and X. Neither the making of any Advance nor the use of proceeds thereof will violate or be inconsistent with the provisions of Regulation T, Regulation U or Regulation X.
(u) Covered Fund. The Borrower is not a "covered fund" (as defined in Section 619 of the Dodd-Frank Wall Street Reform and Consumer Protection Act and §248.10(b) of the rules adopted thereunder) as a result of the exclusion for investment companies registered under Section 8 of the Investment Company Act, as amended, provided under §248.10(c)(12)(i) of the rules adopted thereunder.
(v) Eligible Asset. Each Advance made by a Conduit Lender pursuant to and in accordance with this Agreement shall constitute an "eligible asset" as defined in Rule 3a-7 under the Investment Company Act and there is nothing in the nature of the Assets or properties of the Borrower or in the conduct of its business and operations that could be reasonably likely to impair the ability of any Conduit Lender to rely on Rule 3a-7 under the Investment Company Act for its exemption thereunder.
(w) Sanctions. None of (i) the Borrower, any of its subsidiaries, any director or officer, or Affiliate, of the Borrower or any of its subsidiaries, or (ii) to its knowledge, any other employee or agent of the Borrower or any of its subsidiaries, is a Person that is, or is owned or controlled by Persons that are, (A) the subject of any sanctions administered or enforced by the US Department of the Treasury’s OFAC, the US Department of State, the United Nations Security Council, the European Union, Her Majesty’s Treasury or the Hong Kong Monetary Authority (collectively, "Sanctions"), or (B) located, organized or resident in a Sanctioned Country. None of the Borrower, nor to the knowledge of the Borrower, any director, officer, agent, employee, Affiliate or other person acting on behalf of the Borrower or any of its subsidiaries is aware of or has taken any action, directly or indirectly, that would result in a violation by such persons of any applicable anti-bribery law, including but not limited to, the United Kingdom Bribery Act 2010 (the "UK Bribery Act") and the U.S. Foreign Corrupt Practices Act of 1977 (the "FCPA"). Furthermore, the Borrower and, to the knowledge of the Borrower, its Affiliates have conducted their businesses in compliance with the UK Bribery Act, the FCPA and similar laws, rules or regulations and have instituted and maintain policies and procedures reasonably designed to ensure, and which are reasonably expected to continue to ensure, continued compliance therewith.
(x) Subsidiaries. The Borrower does not have (i) any subsidiaries or (ii) any material equity investments or interests in any Person other than in accordance with its Prospectus, Declaration of Trust, By-laws, or other organizational documents.7
(y) Affiliated Persons. To the best of the knowledge of the Borrower, the Borrower, together with its Affiliates, is not an "Affiliated Person" (as defined in the Investment Company Act) of the Agent, any Lender, or any Secondary Lender.
(z) Borrowings. All borrowings by the Borrower under this Agreement are subject to the requirements of the Investment Company Act.
7 Amendment No. 1
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(aa) Loan Assets. In the reasonable determination of the Borrower, no restriction in any Loan Document for any Loan Assets could materially adversely affect the Borrower’s performance of its obligations hereunder or under any other Program Document.
Article
V
COVENANTS
SECTION 5.01. Affirmative Covenants of the Borrower.
The Borrower covenants and agrees that it shall:
(a) Compliance with Agreements, Laws, Etc. (i) Duly observe, comply with and conform to in all material respects all requirements of Applicable Law relative to the conduct of its business or to its Assets, including without limitation the Investment Company Act, (ii) preserve and keep in full force and effect the legal existence of the Borrower and the rights, privileges, qualifications and franchises of the Borrower, (iii) comply in all material respects with the terms and conditions of each Program Document to which it is a party, and (iv) obtain, maintain and keep in full force and effect all Governmental Authorizations, Private Authorizations and Governmental Filings which are necessary or appropriate to properly carry out its business and the transactions contemplated to be performed by the Borrower under this Agreement and the other Program Documents.
(b) Taxes. Cause to be computed, paid and discharged when due all taxes, assessments and other governmental charges or levies imposed upon it, or upon any income or Assets or properties of the Borrower, prior to the day on which penalties are attached thereto, unless and to the extent that the same shall be contested in good faith by appropriate proceedings and with respect to which adequate reserves have been established on the books of the Borrower in accordance with GAAP.
(c) Further Assurances. Promptly, at its expense, execute and deliver such further instruments and take such further action in order to (i) establish and protect the rights, interests and remedies created, or intended to be created, in favor of the Secured Parties including, without limitation, all such actions which are necessary or advisable to maintain and protect the Agent's first priority perfected security interest in the Pledged Collateral for the benefit of the Secured Parties free and clear of Adverse Claims (including, without limitation, take or cause to take any actions required under the laws of the jurisdiction in which any assets are held by a foreign sub-custodian), (ii) enable the Secured Parties to enforce their rights and remedies under the Program Documents, including, without limitation, to do all things necessary at the request of the Agent during the continuance of an Event of Default to have each Loan Asset which constitutes Pledged Collateral and the related Loan Documents assigned to the Agent or its designee, and (iii) effectuate the intent and purpose of, and to carry out the terms of, the Program Documents.
(d) Continued Existence. Keep the Commonwealth of Massachusetts as its jurisdiction of organization and keep its principal place of business and chief executive office at the address of the Borrower set forth in Section 9.02 or, upon thirty (30) days’ prior written notice to the Agent, in any other jurisdiction of organization or at any other locations in jurisdictions where all actions reasonably requested by the Agent to protect and perfect the Agent’s first priority perfected security interest in the Pledged Collateral have been taken and completed , and maintain the state of the principal residence of each Trustee as set forth on Schedule IV, as the same may be amended from time to time, upon thirty (30) days’ prior written notice to the Agent.
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(e) Financial Statement; Accountants’ Reports; Other Information. Provide to the Agent (with enough additional copies for each Conduit Lender and each Secondary Lender):
(i) (a) as soon as available, and in any event within one hundred and twenty (120) days after the end of each fiscal year of the Borrower, a statement of assets and liabilities of the Borrower as at the end of such fiscal year, and statements of operations and of changes in net assets of the Borrower for such fiscal year, and a portfolio of investments as of the end of such fiscal year, with an audit report thereon issued by Deloitte & Touche LLP or other independent certified public accountants of nationally recognized standing, together with the comparable report for the prior fiscal year, and (b) as soon as available, and in any event within five (5) days after filing thereof, copies of each Form 10-K and each other filing containing financial information for the fiscal year then ended which Morgan Stanley shall have filed with the SEC;
(ii) (a) as soon as available and in any event within ninety (90) days after the end of each first semi-annual fiscal period of the Borrower, a statement of assets and liabilities of the Borrower as at the end of such period, a statement of operations and of changes in net assets of the Borrower for such period, and a portfolio of investments as of the end of such period, all in reasonable detail and stating in comparative form the respective figures for the comparable period in the preceding year, prepared in accordance with GAAP, consistently applied and all certified (subject to normal year-end adjustment) as to fairness of presentation in all material respects by a Responsible Officer of the Borrower, and (b) as soon as available, and in any event within five (5) days after filing thereof, copies of each Form 10-Q and each other filing containing financial information for the fiscal quarter then ended which Morgan Stanley shall have filed with the SEC;
(iii) simultaneously with the delivery of each set of financial statements referred to in clauses (i) and (ii) above, a statement of either the firm of independent public accountants which reported on such statements or a Responsible Officer to the effect that nothing has come to its attention to cause it to believe that any Default or Event of Default existed on the date of such statements;
(iv) as soon as possible, and in any event within two (2) Business Days of the occurrence of any Default or Event of Default, a certificate of a Responsible Officer of the Borrower setting forth the details thereof and the action which the Borrower is taking or proposes to take with respect thereto;
(v) as soon as possible, and in any event within two (2) Business Days, after the Borrower has knowledge of any failure by the Custodian to perform or observe any term, covenant or agreement on its part to be performed under the Custodial Agreement or the Control Agreement, written notice thereof executed by a Responsible Officer of the Borrower;
(vi) promptly upon the mailing thereof to the shareholders of the Borrower, generally, copies of all financial statements, reports and proxy statements so mailed;
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(vii) promptly upon the filing thereof, copies of all registration statements (other than the exhibits thereto and any registration statements on Form N-2 or its equivalent) and annual and semi-annual reports which the Borrower shall have filed with the SEC;
(viii) from time to time upon the request of the Agent, the Borrower shall, or shall cause the Custodian to deliver a report identifying the locations of any Pledged Collateral which is in the possession of or is maintained in securities accounts with an agent or sub-custodian of the Custodian which report shall specify the Pledged Collateral held by each such agent or sub-custodian;
(ix) an Investor Report substantially in the form of Schedule I hereto, (a) on any Business Day upon the reasonable request of the Agent, with respect to the period from the last day covered under the Investor Report most recently delivered through and including the immediately preceding Business Day (which may be daily), (b) on the Monday of each calendar week, with respect to the immediately preceding week; provided, that if such Monday is not a Business Day, the immediately succeeding Business Day, and (c) on or before the fifth (5th) Business Day of each calendar month, with respect to the immediately preceding calendar month;
(x) promptly upon its receipt of and contemporaneously with its giving of any notice relating to the termination of the Custodial Agreement or the Control Agreement, copies of any such notice;
(xi) prior to the issuance by the Borrower of any preferred shares after the Restatement Effective Date, notice of such issuance which notice shall include the offering materials to be used in connection with the issuance of such preferred shares;
(xii) prompt notice of any amendment or modification to the Investment Policies and Restrictions which notice shall include, in reasonable detail, a description of any such change; and
(xiii) from time to time such additional information regarding the financial position or business of the Borrower and its compliance with this Agreement or the other Program Documents as the Agent may reasonably request.
(f) Maintenance of Property; Insurance. Keep all property useful and necessary in its business, if any, in good working order and condition; maintain with financially sound and reputable insurance companies insurance on all its property in at least such amounts and against at least such risks as are usually insured against in the same general area by entities engaged in the same or similar lines of business of comparable size and financial strength or as may otherwise be required by the Investment Company Act or by the SEC or any successor or analogous Authority (including, without limitation, (i) fidelity bond coverage as shall be required by Rule 17g-1 promulgated under the Investment Company Act or any successor provision, and (ii) errors and omissions insurance); and furnish to the Agent, upon written request, full information as to the insurance carried.
(g) Maintenance of Business. Remain at all times a closed-end investment company for the purposes of the Investment Company Act and continue to engage in business of the same general type as now conducted by the Borrower, and will preserve, renew and keep in full force and effect its existence and rights, privileges and franchises necessary or desirable in the normal conduct of business and will at all times remain registered under the Investment Company Act.
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(h) Audits. Annually (or more frequently as the Agent, for itself and as agent for the Secured Parties may require after the occurrence of and during the continuance of a Default or an Event of Default) and at the sole cost and expense of the Borrower (i) cause Deloitte & Touche, LLP, or another independent nationally recognized accounting firm selected by the Borrower and reasonably satisfactory to the Agent, to enter the premises of the Borrower and any Person to whom the Borrower delegates all or any portion of its duties under any Program Document (including, without limitation, the Adviser) and examine and audit the books, records and accounts of the Borrower and such other Person relating to its business, financial condition, operations and the Borrower’s and such other Person's performance under the Program Documents, (ii) permit such accounting firm to discuss the Borrower’s and such other Person's affairs and finances with the officers, partners, employees and accountants of any of them, (iii) cause such accounting firm to provide to the Agent, for itself and as agent for the Secured Parties, with a certified report in respect of the foregoing, which shall be in form and scope reasonably satisfactory to the Agent, for itself and as agent for the Secured Parties, and (iv) authorize such accounting firm to discuss such affairs, finances and performance with representatives of the Agent and its designees.
(i) Access to Records. Permit the Agent or any Person designated by the Agent to, upon reasonable advance notice and during normal hours, visit and inspect at reasonable intervals its and any Person to which it delegates any of its duties under the Program Documents (including, without limitation, the Adviser) books, records and accounts relating to its business, financial condition, operations, Assets and its performance under the Program Documents and to discuss the foregoing with its and such Person's officers, partners, employees and accountants, all as often as the Agent may reasonably request.
(j) Investment Policies and Restrictions. At all times be in compliance in all material respects with Investment Policies and Restrictions and maintain necessary liquidity to meet its obligations to fund future advances or other extensions of credit under the Loan Documents relating to its Loan Assets.
(k) Defense of Secured Parties’ Interest. Defend each of the Secured Parties' right and interest in, to and under the Pledged Collateral against all Adverse Claims of all Persons whomsoever.
(l) Custody and Control. At all times cause all Borrowing Base Eligible Assets of the Borrower (including all investments, if any, evidencing the same and all Loan Documents) to constitute Pledged Collateral and to be (i) custodied with the Custodian to the Custodial Agreement, and (ii) subject to the Custodian's control and custody in accordance with the Custodial Agreement and the Control Agreement; provided, that if such Borrowing Base Eligible Asset or Pledged Collateral is a Loan Asset and concurrently with any request to register such Loan Asset in the name of the Borrower, the Borrower shall deliver instructions to all Selling Institutions, Transaction Agents and Obligors related to such Loan Asset requiring that any instrument evidencing such Loan Asset be delivered to the Custodian. At all times cause all Loan Documents (other than Specified Loan Documents) to be held at the addresses set forth on Schedule II or, such other location as the Borrower shall designate upon twenty (20) day's prior written notice to the Agent.
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(m) Notice of Litigation or Other Proceedings. Promptly give notice in writing to the Agent of all material litigation, arbitration proceedings and regulatory proceedings affecting the Borrower or the Assets of the Borrower.
(n) Maintenance of Books of Record and Account. Keep proper books of record and account in which full, true and correct entries shall be made of all dealings and transactions in relation to its business and activities in accordance with the requirements of the SEC or under the Investment Company Act.
(o) Proceeds of Pledged Collateral. Cause all Proceeds of the Pledged Collateral to be remitted to the Collateral Account if a Default or Event of Default shall be continuing or would occur as a result of the failure to so remit such Proceeds.
(p) Use of Proceeds. Use the net proceeds of any Advance made hereunder solely in the ordinary course of its business or financial affairs for the purpose of (i) purchasing Assets (other than any Asset which constitutes real property or a direct interest therein), (ii) paying principal and Yield in respect of outstanding Advances, or (iii) for general fund purposes.
(q) Adviser. At all times maintain the Adviser or an Eligible Successor Adviser reasonably acceptable to the Agent as the Borrower's investment adviser, provided, that if the Board of Trustees of the Borrower shall have terminated the Advisory Agreement by terminating the Adviser, the Borrower shall replace the Adviser with an Eligible Successor Adviser reasonably satisfactory to the Agent on terms reasonably satisfactory to the Agent in accordance with the terms of the Program Documents within ten (10) days of such termination.
(r) Beneficial Ownership Certification. To the extent the Borrower qualifies as a “legal entity customer” under 31 C.F.R. §1010.230, the Borrower shall furnish to the Agent all information regarding beneficial ownership required by such regulation, if any.
SECTION 5.02. Negative Covenants of the Borrower.
The Borrower covenants and agrees that the Borrower shall not:
(a) Impairment of Rights. Enter into any agreement containing any provision which would be violated or breached by the performance of its obligations under any Program Document.
(b) Prospectus and Investment Policies and Restrictions. Purchase any Assets or engage in any line of business not contemplated by the Prospectus or the Investment Policies and Restrictions in effect on the Restatement Effective Date, as such Investment Policies may be subsequently amended by the Borrower's Board of Trustees in accordance with the terms of this Agreement (and which would not necessarily be disclosed in a Prospectus) or take any action inconsistent with the Prospectus, including without limitation, the Investment Policies and Restrictions.
(c) Creation of Debt. Create, assume or suffer to exist any Debt or any Guarantee, except for Permitted Debt.
(d) Mergers; Sale of Assets. Adopt or carry out any plan of liquidation, partial liquidation, reorganization, incorporation or recapitalization, or merge into or consolidate with, or convey, transfer, lease or otherwise dispose of (whether in one transaction or in a series
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of transactions) any of its Assets other than ordinary course sales of Assets in the conduct of its business as an investment company, other than as contemplated in the Program Documents, provided, however, that in the event such ordinary course sale or transfer of Assets would result in a decrease in the Borrowing Base (as set forth in the most recent Investor Report) equal to or greater than percent (%), such sale shall be permitted only if the Borrower delivers to the Agent a certificate demonstrating compliance with the Borrowing Base Test and the Asset Coverage Test after giving effect to such sale.
(e) Advances and Extensions of Credit. Make any (i) payment or make any advance or other extension of credit except in the ordinary course of the Borrower’s business and as expressly contemplated by the Investment Policies and Restrictions in effect on the Restatement Effective Date, or as otherwise modified in accordance with Section 5.02(i) below, or (ii) advance or other extension of credit to any Person, except as contemplated by the Investment Policies and Restrictions in effect on the Restatement Effective Date, or as otherwise modified in accordance with Section 5.02(i) below.
(f) Custodial Agreement and Advisory Agreement. Permit or consent to a change of the Custodian without the prior written consent of the Agent. Permit or consent to any material amendment, modification or waiver of the Custodial Agreement, unless the Borrower has delivered to the Agent a certificate of a Responsible Officer of the Borrower certifying that such amendment, modification or waiver could not reasonably be expected to have a Material Adverse Effect. Permit or cause the Advisory Agreement in effect on the Restatement Effective Date or any replacement advisory agreement approved of in writing by the Agent to be terminated unless a replacement investment management agreement has been entered into with an Eligible Successor Adviser which is substantially similar in all material respects to the Advisory Agreement in effect immediately prior to any such termination. Without the prior written consent of the Agent, permit or cause the Advisory Agreement in effect on the Restatement Effective Date or any replacement advisory agreement approved of in writing by the Agent to be amended, waived or otherwise modified in a manner that could reasonably be expected to give rise to a Material Adverse Effect.
(g) Amendments to Organizational Documents. Amend, terminate, supplement or otherwise modify in any material respect its declaration of trust, By-laws or other organizational documents.
(h) ERISA. Become a member of an ERISA Group or incur any liability or obligation with respect to Plan, Multiemployer Plan or any Benefit Arrangement.
(i) Investment Policies and Restrictions. Without the prior written consent of the Agent (which consent shall not be unreasonably withheld or delayed) permit any material change in the Investment Policies and Restrictions in effect on the Restatement Effective Date, unless required by a change in Applicable Law.
(j) Liens. Create, assume or suffer to exist any Adverse Claim on any Asset now owned or hereafter acquired by it (including without limitation the Pledged Collateral).
(k) Senior Securities. Issue any "senior securities", as such term is defined and used in the Investment Company Act other than Permitted Senior Securities.
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(l) Margin Requirements. Extend credit to others for the purpose of buying or carrying any "margin stock" in such a manner as to violate Regulation T, Regulation U or Regulation X or use the proceeds of any Advance in violation of Regulation T, Regulation U or Regulation X.
(m) Restricted Payments. Make any Restricted Payment (other than Restricted Payments in connection with the ARPS Retirement or an ARPS Mandatory Redemption) (i) if immediately after giving effect to such payment the Borrower will not be in full compliance with the Borrowing Base Test and the Asset Coverage Test, (ii) if any Default or Event of Default shall result from the making of such Restricted Payment, (iii) if any Default of the type specified in Section 6.01(f) shall be continuing with respect to the Borrower, or (iv) if any Event of Default shall be continuing.
(n) ARPS Retirement and ARPS Mandatory Redemption Restricted Payments. Make any Restricted Payment in connection with the ARPS Retirement or an ARPS Mandatory Redemption unless (i) immediately after giving effect to such payment the Borrower will be in full compliance with the Borrowing Base Test and the Asset Coverage Test and the Agent shall have received a pro forma Investor Report, which shall evidence compliance therewith, (ii) no Default or Event of Default shall result from the making of such Restricted Payment; unless, with respect to subparagraphs (i) and (ii) hereof, (a) if such noncompliance or Default or Event of Default can be prevented from occurring prior to the making of such Restricted Payment by the prepayment of Advances or the delivery of additional Pledged Collateral, prior to making such Restricted Payment, the Borrower has prepaid Advances or provided such additional Pledged Collateral in an amount sufficient to prevent such noncompliance or Default or Event or Default from occurring upon such Restricted Payment being made, and (b) if such noncompliance or Default or Event of Default cannot be prevented by the prepayment of Advances or delivery of additional Pledged Collateral prior to the making of such Restricted Payment, then the Borrower shall have repaid all Borrower Obligations, the Total Commitment shall have been terminated and the Program Termination Date shall have occurred, and (iii) no Default or Event of Default of the type specified in Section 6.01(f) shall be continuing with respect to the Borrower.
(o) Name Change. Change its name (i) without giving the Agent at least thirty (30) days prior written notice, and (ii) unless all actions necessary and appropriate to protect and perfect the Secured Parties' first priority perfected security interest in the Pledged Collateral have been taken and completed.
(p) Custodian’s Overdraft Advances. Permit the Aggregate Custodian’s Advance Amount to at any time exceed $.
(q) Pledged Collateral; Notice of Exclusive Control. Without the prior written consent of the Agent, sell, dispose of or substitute any Pledged Collateral or originate any entitlement orders or other instructions with respect to any Pledged Collateral unless immediately following any such sale, disposition or substitution the Borrower will be in full compliance with the Borrowing Base Test and the Asset Coverage Test. After the Borrower has received written notice of delivery by the Agent to the Custodian of a Notice of Exclusive Control, unless such Notice of Exclusive Control is revoked in writing by the Agent, give any instruction to the Custodian in respect of the Pledged Collateral without the prior written consent of the Agent.
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(r) Subsidiaries. The Borrower shall not establish any Subsidiaries without the prior written consent of the Agent.
(s) Conversion to Open-End Status, Etc. Convert to an open-end investment company or purchase any Asset or engage in any line of business not contemplated by the Prospectus without the Agent's prior written consent.
(t) Sanctions. The Borrower will not, directly or indirectly, use the proceeds of any Advance, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other Person, (i) to knowingly (after having made all reasonable investigations) fund any activities or business of or with any Person, or in any country or territory, that, at the time of such funding, is, or whose government is, the subject of Sanctions or (ii) in any other manner that would reasonably result in a violation of Sanctions by any Person (including any Person participating in the Advances, whether as underwriter, advisor, investor or otherwise). No part of the proceeds of any Advance will be used, directly or indirectly, for any payments that could constitute a violation of any applicable anti-bribery law.
(u) Transactions with Affiliates. Sell, lease or otherwise transfer any property or assets to, or purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any other transactions with, any of its affiliates, except in compliance with the provisions of the Investment Company Act and the rules and regulations thereunder or pursuant to an exemption therefrom by the SEC or pursuant to a "no-action" letter issued to such Borrower by the SEC indicating that the staff of the SEC would not recommend enforcement action as a result of such transaction.
(v) Adviser Bankruptcy Event. If the Advisory Agreement shall have terminated as a result of an event of the type described in Section 6.01(f) involving the Adviser and a successor investment advisor has not been appointed as contemplated by Sections 5.01(q), 5.02(f), or 6.01(m), the Borrower shall not remove or give instructions to the Custodian to remove any Asset (including any cash or other proceeds of) from the Collateral Account or otherwise release or cause any Asset pledged to the Agent at such time to no longer constitute Pledged Collateral, without the prior written consent of the Agent (which consent shall not be unreasonably withheld or delayed).
Article
VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default.
If any of the following events (each an "Event of Default") shall occur:
(a) the Borrower shall fail to make or cause to be made in the manner and when due any payment or deposit to be made or to be caused to be made by it under this Agreement or any of the other Program Documents to which it is a party and such failure shall continue for (i) in the case of any principal payments on any Advance (other than the failure to comply with clauses (b), (c) and (d) of Section 2.05 in which case no grace period or requirement of notice shall apply, other than the cure periods set forth in such clauses), one (1) Business Day, and (ii) in the case of all other payments (other than the failure to comply with clauses (b), (c) and (d) of Section 2.05 in which case no grace period or requirement of notice shall apply, other than the cure periods set forth in such clauses), three (3) Business Days; or
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(b) the Borrower shall fail to comply with clauses (b), (c) or (d) of Section 2.05 (after giving effect to the applicable cure periods set forth in such clauses), clauses (g), (l) or (q) of Section 5.01 or clauses (c), (d), (e), (f), (h), (i), (k) or (m) of Section 5.02 or the Adviser shall fail to comply with the Letter Agreement; or
(c) the Borrower or the Adviser shall fail to perform or observe any other term, covenant or agreement on its part to be performed or observed under this Agreement or any other Program Document and such failure shall continue for ten (10) Business Days; or
(d) any representation or warranty made or deemed made by the Borrower or the Adviser under or in connection with this Agreement, the Control Agreement, the Letter Agreement or any other Program Document or any other certificate, information or report delivered by or on behalf of the Borrower or the Adviser in connection therewith shall have been false or incorrect when made or deemed made or delivered or any representation or warranty made or deemed made by the Borrower or the Adviser in any other Program Document to which it is a party or any certificate, information or report delivered by or on behalf of the Borrower or the Adviser in connection therewith shall be false or incorrect in any material respect when made or deemed made or delivered; or
(e) the Agent shall for any reason cease to have a valid and perfected first priority security interest in the Pledged Collateral (subject to the Lien of the Custodian securing the Custodian's Overdraft Advances to the extent permitted by Section 5.02(p)) free and clear of all Adverse Claims or the Custodian, as collateral agent and/or securities intermediary under the Control Agreement, shall not have custody and control, as contemplated by the Control Agreement, of the Pledged Collateral; or
(f) the Borrower, the Adviser or Morgan Stanley shall generally not pay its debts as such debts become due, or shall admit in writing its inability to pay its debts generally, or shall make a general assignment for the benefit of creditors; or any proceeding shall be instituted by or against the Borrower, the Adviser or Morgan Stanley seeking to adjudicate it a bankrupt or insolvent, or seeking liquidation, winding up, reorganization, arrangement, adjustment, protection, relief, or composition of it or its debts under any law relating to bankruptcy, insolvency or reorganization or relief of debtors, or seeking the entry of an order for relief or the appointment of a receiver, trustee, custodian or other similar official for it or for any substantial part of its property and, in the case of any such proceeding instituted against it (but not instituted by it), either such proceeding shall remain undismissed or unstayed for a period of forty (40) days, or any of the actions sought in such proceeding (including an order for relief against, or the appointment of a receiver, trustee, custodian or other similar official for, it or for any substantial part of its property) shall occur; or the Borrower, the Adviser, Morgan Stanley or the Custodian shall take any action to authorize any of the actions set forth above in this subsection; or
(g) any material provision of any Program Document (other than any Loan Document) shall cease to be a legal, valid and binding obligation of any of the parties purported to be bound thereby, enforceable in accordance with its respective terms or any party thereto (other than a Secured Party) shall so assert in writing; or
(h) there shall have been a material default or material breach, or to the extent defined therein, an Event of Default, under any Program Document (other than any Loan Document); or
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(i) any judgment or order, or any series of judgments or orders, shall have been entered against the Borrower, provided that (i) such judgments or orders shall aggregate to more than $ (other than any judgment or order as to which, and only to the extent, a reputable insurance company has acknowledged coverage of such claim in writing or has acknowledged in writing its willingness to defend any such claim under a reservation of rights), and (ii) enforcement actions have been commenced with respect thereto and have not been dismissed for ten (10) Business Days or more; or
(j) either (1) State Street Bank and Trust Company (or any successor approved of in writing by the Agent) shall at any time cease to serve as Custodian under the Custodial Agreement or the Control Agreement, unless a successor thereto satisfactory to the Agent shall have assumed the duties of Custodian thereunder and in accordance with the terms of the Program Documents, or (2) the Custodian or the Borrower shall have given notice of the termination of the Custodial Agreement or the Control Agreement; provided, however, that events specified in clause (2) above shall not constitute an Event of Default if prior to the fifth (5th) Business Day immediately preceding the effective date of such termination a successor custodian reasonably satisfactory to the Agent shall have been appointed as custodian under the Custodial Agreement and shall have assumed the obligations of the Custodian under the Custodial Agreement and the Control Agreement and the Agent shall have received such certificates and opinions as it shall have reasonably requested; or
(k) any event or condition shall occur which results in the acceleration of the maturity of any Debt of the Borrower which Debt in the aggregate is at least $ or enables (or, with the giving of notice or lapse of time or both would enable) the holder of such Debt or any Person acting on such holder’s behalf to accelerate the maturity thereof; or
(l) any change in Law shall be enacted, promulgated or proposed which (i) would limit in any material respect the ability of the Agent, or any Secured Party, to foreclose upon its interest in, or in the event of such foreclosure to dispose of, the Pledged Collateral or to be granted the security interest in Pledged Collateral as contemplated by the Program Documents, or (ii) unless such changes have been consented to in writing by the Agent, would require any change to the Investment Policies and Restrictions which in the reasonable opinion of the Agent could materially adversely affect the net asset value of the Borrower, materially increase the credit risk associated with the Assets of the Borrower or otherwise give rise to a reasonable possibility of a Material Adverse Effect; provided, however, that notwithstanding anything herein to the contrary, the Dodd-Frank Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith shall be deemed to be a “change in Law” for purposes hereof, regardless of the date enacted, adopted or issued; or
(m) the Advisory Agreement in effect on the date of certification of shareholder approval thereof following the Acquisition Closing Date shall be (i) amended, waived or otherwise modified in any respect which could reasonably be expected to cause a Material Adverse Effect, or (ii) terminated, in either case without the prior written consent of the Agent; provided, that if the Board of Trustees of the Borrower shall have terminated the Advisory Agreement by terminating the Adviser, but shall have replaced the Adviser with an Eligible Successor Adviser reasonably satisfactory to the Agent and on terms reasonably satisfactory to the Agent in accordance with the terms of the Program Documents within ten (10) days of such termination, and such successor investment adviser shall have entered into an agreement with the Agent which is substantially identical to the Letter Agreement and such Letter Agreement is in full force and effect, no Event of Default under this clause (n) shall be deemed to have occurred after the date of such replacement and the Program Documents have been amended to reflect such replacement; or
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(n) the Adviser shall (i) sell or otherwise dispose of all or a substantial portion of its Assets, (ii) consolidate with or merge into any other entity unless it is the survivor, or (iii) acquire all or substantially all of the assets of another Person, unless the assets acquired are less than percent (%) of its assets, unless in each case the Agent has consented to the same in writing, which consent shall not be unreasonably withheld; or
(o) as of the last Business Day of any calendar month after the Restatement Effective Date, the NAV of the Borrower shall have decreased by percent (%) or more from the NAV of the Borrower as of the last Business Day of the immediately preceding calendar month; provided that, for the avoidance of doubt, a decrease in the NAV of the Borrower as computed as of any day during a calendar month other than as of the last Business Day of such month by percent (%) or more from the NAV of the Borrower as of the last Business Day of the immediately preceding calendar month shall not be considered a “Default” or an “Event of Default” under this subsection;8
(p) notwithstanding anything to the contrary set forth in this Agreement, including without limitation Section 2.05, the Borrower shall not be in full compliance with the Asset Coverage Test or the Borrowing Base Test or the aggregate outstanding amount of Advances or other indebtedness of the Borrower exceeds any Borrowing Limit for fifteen (15) consecutive Business Days; or
(q) Other than to the extent permitted by Section 5.01(q),9 (i) the Adviser shall cease to be a wholly owned direct or indirect subsidiary of Morgan Stanley, (ii) Eaton Vance Management or another Eligible Successor Adviser shall cease to be the Borrower’s investment adviser, or (iii) the Letter Agreement or a replacement letter agreement executed by the Agent shall cease to be in full force and effect.
then, and in any such event, in addition to all rights and remedies specified in this Agreement, including without limitation, Article VII, and the rights and remedies of a secured party under Applicable Law including, without limitation the UCC, the Agent may, by notice to the Borrower, declare the Termination Date to have occurred and declare the outstanding Advances to be due and payable (in which case the Termination Date and the Maturity Date shall be deemed to have occurred); provided, that, upon the occurrence of any event (without any requirement for the passage of time or the giving of notice, or both) described in subsection (f) of this Section 6.01 with respect to the Borrower, the Termination Date and the Maturity Date shall be deemed to have automatically occurred.
Article
VII
PLEDGE OF PLEDGED COLLATERAL; RIGHTS OF THE AGENT
SECTION 7.01. Security Interests.
In consideration of the Conduit Lenders and the Secondary Lenders making and maintaining the Advances, and as collateral security for the prompt, complete and unconditional payment and performance of all of the Borrower Obligations, the Borrower hereby pledges (and in the case of all Pledged Collateral other than the Loan Assets),
8 Amendment No. 3
9 Amendment No. 1
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hypothecates, collaterally assigns, transfers, sets over and delivers to the Agent for the benefit of the Secured Parties and grants to the Agent for the benefit of the Secured Parties a continuing Lien upon and security interest in, all of the Borrower's right, title and interest in, to and under the following assets and properties, whether now owned or existing or hereafter arising or acquired and wheresoever located (the items specified in clauses (i) through (viii) below, collectively, the "Pledged Collateral"):
(i) all of the cash, Assets, investments and property from time to time credited to the Collateral Account, including all security entitlements with respect to the Collateral Account and all Loan Assets held by the Custodian for the benefit of the Agent pursuant to the Control Agreement;
(ii) the Collateral Account (together with all other accounts in which the distributions referred to in clause (iii) below are remitted);
(iii) all interest, dividends, stock dividends, stock splits, distributions and other money or property of any kind distributed in respect of the assets, investments, property and security entitlements described in clause (i) above, including without limitation the principal payments in respect of such Loan Assets;
(iv) all rights and remedies of the Borrower under the Loan Documents and the Custodial Agreement in respect of the assets, investments, property and security entitlements described in clause (i) above;
(v) all security interests, liens, collateral, property, guaranties, supporting obligations, insurance and other agreements or arrangements of whatever character from time to time supporting or securing payment of the assets, investments, property and security entitlements described in clause (i) above;
(vi) all accounts, contract rights, documents, instruments, securities, investment property, chattel paper, general intangibles (including payment intangibles), inventory, goods, equipment and all other property of every kind and nature, now owned or hereafter acquired in respect of the assets, investments, property and security entitlements described in clause (i) above);
(vii) all books, records and other information (including, without limitation, computer programs, tapes, discs, punch cards, data processing software and related property and rights) relating to the assets, investments, property and security entitlements described in clause (i) above; and
(viii) all Proceeds of any and all of the foregoing.
SECTION 7.02. Substitution of Collateral and Release of Security Interest.
(a) So long as no Default or Event of Default shall have occurred and be continuing or would occur as a consequence of such sale, transfer, disposition or substitution and the Borrowing Base Test will be satisfied immediately following such sale, transfer, disposition or substitution, the Borrower may originate entitlement orders with respect to the Collateral Account and may sell, transfer or dispose of or substitute Pledged Collateral in accordance with the terms of this Agreement and the Control Agreement.
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(b) After the Program Termination Date, the Agent at the request of the Borrower shall execute, deliver and file such instruments as the Borrower shall reasonably request in order to reassign, release or terminate its security interest in the Pledged Collateral. Any and all actions under this Section 7.02 shall be without any recourse to, or representation or warranty by, the Agent or any Secured Party and shall be at the sole cost and expense of the Borrower.
SECTION 7.03. Application of Proceeds.
(a) After the occurrence and during the continuance of an Event of Default, all amounts remitted to the Agent's Account in respect of the Borrower Obligations, including without limitation all Proceeds resulting from the sale or other disposition of the Pledged Collateral, shall be applied by the Agent in the following order and priority:
First, to the payment of all amounts advanced or expended by the Agent and all costs and expenses incurred by the Agent in connection with the enforcement of the Secured Parties’ rights and remedies under the Program Documents;
Second, to the extent funds are remaining after the above application, to the Lenders and the Secondary Lenders to the payment of all accrued and unpaid Yield on all outstanding Advances on a pro-rata basis according to the amount of accrued Yield owing to each Lender and each Secondary Lender;
Third, to the extent funds are remaining after the above applications, to the Secured Parties to the payment of all fees payable under the Fee Letter on a pro rata basis according to the amount of such fees owing to each Secured Party;
Fourth, to the extent funds are remaining after the above applications, to the Lenders and the Secondary Lenders to the payment of the principal amount of each outstanding Advance on a pro-rata basis according to the amount of principal owing to each Lender and each Secondary Lender;
Fifth, to the extent funds are remaining after the above applications, to the Secured Parties and any Affected Person to the payment of all Borrower Obligations and other amounts payable to the Secured Parties pursuant to this Agreement and the other Program Documents on a pro rata basis according to the amounts owed to each Person.
The Agent shall, after the final payment in full of all Advances and all other Borrower Obligations, remit the remaining excess Proceeds which it had received from the sale or disposition of the Pledged Collateral to the Borrower’s Account.
(b) For purposes of determining the application to be made of such monies and other cash proceeds by the Agent to the Lenders and the Secondary Lenders pursuant to this Section 7.03, the Agent may rely exclusively upon a certificate or other statement of the Lenders or such Secondary Lender, as the case may be, setting forth in reasonable detail the amount then owing to such Lender and such Secondary Lender, as the case may be. The Agent shall not be liable for any application of funds in accordance with any certificate or direction delivered pursuant to this Section 7.03; provided, however, that no application of funds in accordance with any certificate delivered pursuant to this Section 7.03 shall be deemed to restrict or limit the right of any party to contest with the purported obligee its respective liability in respect of the amount set forth in such certificate.
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SECTION 7.04. Rights and Remedies upon Event of Default.
(a) The Agent (for itself and on behalf of the other Secured Parties) shall have all of the rights and remedies of a secured party under the UCC and other Applicable Law. Upon the occurrence and during the continuance of an Event of Default, the Agent or its designees may (i) deliver a Notice of Exclusive Control to the Custodian; (ii) instruct the Custodian to deliver any or all of the Pledged Collateral and any Loan Documents relating to the Pledged Collateral to the Agent or its designees and otherwise give all instructions and entitlement orders to the Custodian regarding the Pledged Collateral; (iii) sell or otherwise dispose of the Pledged Collateral, all without judicial process or proceedings; (iv) take control of the Proceeds of any such Pledged Collateral; (v) subject to the provisions of the applicable Loan Documents, exercise any consensual or voting rights in respect of the Pledged Collateral; (vi) release, make extensions, discharges, exchanges or substitutions for, or surrender all or any part of the Pledged Collateral; (vii) enforce the Borrower’s rights and remedies under the Custodial Agreement with respect to the Pledged Collateral; (viii) institute and prosecute legal and equitable proceedings to enforce collection of, or realize upon, any of the Pledged Collateral; (ix) require that the Borrower and the Custodian immediately take action to liquidate the Assets to pay amounts due and payable in respect of the Borrower Obligations; (x) remove from the Borrower's, the Adviser's and their respective agents' place of business all books, records and documents relating to the Pledged Collateral unless copies thereof shall have been provided to the Agent which copies of such books and records shall thereafter be deemed to be originals thereof; and/or (xi) notify all Selling Institutions, Transaction Agents and Obligors related to the Loan Assets which constitute Pledged Collateral to make payments in respect thereof directly to the Agent’s Account; (xii) at the request of the Agent execute all documents and agreements which are necessary or appropriate to have the Pledged Collateral which constitutes Loan Assets to be assigned to the Agent or its designee; and (xiii) endorse the name of the Borrower upon any items of payment relating to the Pledged Collateral or upon any proof of claim in bankruptcy against an account debtor. For purposes of taking the actions described in Subsections (i) through (xiii) of this Section 7.04(a) the Borrower hereby irrevocably appoints the Agent as its attorney-in-fact (which appointment being coupled with an interest is irrevocable while any of the Borrower Obligations remain unpaid), with power of substitution, in the name of the Agent or in the name of the Borrower or otherwise, for the use and benefit of the Agent, but at the cost and expense of the Borrower and without notice to the Borrower.
(b) All sums paid or advanced by the Agent in connection with the foregoing and all costs and expenses (including, without limitation, reasonable attorneys’ fees and expenses) incurred in connection therewith, together with interest thereon at the Post-Default Rate from the date of payment until repaid in full, shall be paid by the Borrower to the Agent on demand and shall constitute and become a part of the Borrower Obligations secured hereby.
SECTION 7.05. Remedies Cumulative.
Each right, power, and remedy of the Agent and the other Secured Parties, or any of them, as provided for in this Agreement or in the other Program Documents or now or hereafter existing at law or in equity or by statute or otherwise shall be cumulative and concurrent and shall be in addition to every other right, power, or remedy provided for in this
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Agreement or in the other Program Documents or now or hereafter existing at law or in equity or by statute or otherwise, and the exercise or beginning of the exercise by the Agent or any other Secured Party of any one or more of such rights, powers, or remedies shall not preclude the simultaneous or later exercise by such Persons of any or all such other rights, powers, or remedies. For the avoidance of doubt, and subject to Section 9.18, each of the parties hereto hereby acknowledges and agrees that this Agreement shall be full recourse to the Assets of the Borrower in accordance with the terms hereof and the other Program Documents.
Section 7.06. Enforcement of Remedies under the Custodial Agreement and Loan Documents.
(a) The Borrower agrees that it shall (i) upon the request of the Agent (and at the Borrower’s own expense) diligently enforce the rights and remedies under the Custodial Agreement and at law or equity against the Custodian for the breach by the Custodian of any term, covenant or agreement thereunder relating to or affecting any Pledged Collateral, and (ii) diligently enforce its rights and remedies under the Loan Documents relating to the Pledged Collateral. In enforcing such rights and remedies the Borrower shall exercise the same degree of care that it would exercise if this Agreement had not been entered into; provided, that the Borrower shall not, in enforcing such rights and remedies, settle any claim against the Custodian without the prior written consent of the Agent (which consent shall not be unreasonably withheld).
(b) The Borrower agrees that to the extent not expressly prohibited by the terms of the related Loan Documents, it shall (i) upon the written request of the Agent promptly forward to the Agent all information and notices which it receives under or in connection with the Loan Documents relating to the Pledged Collateral, and (ii) following a Default or an Event of Default, act and refrain from acting in respect of any request, act, decision or vote under the Loan Documents relating to the Pledged Collateral only in accordance with the direction of the Agent.
Article VIII
THE AGENT
SECTION 8.01. Authorization and Action.
Each Lender and each of the Secondary Lenders hereby irrevocably appoints and authorizes the Agent to take such action as agent on its behalf and to exercise such powers under this Agreement, the other Program Documents and the Asset Purchase Agreement as are delegated to the Agent by the terms hereof and thereof, together with such powers as are reasonably incidental thereto. The Agent shall not have any duties or responsibilities, except those expressly set forth herein or in the other Program Documents, or any fiduciary relationship with any Secured Party, and no implied covenants, functions, responsibilities, duties or obligations or liabilities on the part of the Agent shall be read into this Agreement, any other Program Document or the Asset Purchase Agreement or otherwise exist for the Agent. As to any matters not expressly provided for by this Agreement, the other Program Documents or the Asset Purchase Agreement, the Agent shall not be required to exercise any discretion or take any action, but shall be required to act or to refrain from acting (and shall be fully protected in so acting or refraining from acting) upon the instructions of the Lenders or the Secondary Lenders; provided, however, that the Agent shall not be required to take any action which exposes the Agent to personal liability or which is contrary to this Agreement, the other Program Documents, the Asset Purchase Agreement or Applicable Law. Each Lender and each Secondary Lender
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agrees that in any instance in which the Program Documents provide that the Agent's consent may not be unreasonably withheld, provide for the exercise of the Agent's reasonable discretion, or provide to a similar effect, it shall not in its instructions to the Agent withhold its consent or exercise its discretion in an unreasonable manner.
SECTION 8.02. Delegation of Duties.
The Agent may execute any of its duties under this Agreement, each other Program Document and the Asset Purchase Agreement by or through agents or attorneys-in-fact and shall be entitled to advice of counsel concerning all matters pertaining to such duties. The Agent shall not be responsible for the negligence or misconduct of any agents or attorneys-in-fact selected by it with reasonable care.
SECTION 8.03. Agent's Reliance, Etc.
The Agent shall not have any duties or obligations except for those expressly set forth in this Agreement and the other Program Documents. Neither the Agent nor any of its directors, officers, agents or employees shall be liable for any action taken or omitted to be taken by it or them under or in connection with this Agreement, any of the other Program Documents or the Asset Purchase Agreement, except for its or their own gross negligence or willful misconduct. Without limiting the generality of the foregoing, the Agent: (i) may consult with legal counsel (including counsel for the Borrower or the Adviser) and independent public accountants and other experts selected by it and shall not be liable for any action taken or omitted to be taken in good faith by it in accordance with the advice of such counsel, accountants or experts; (ii) makes no warranty or representation to any Secured Party or any other Person and shall not be responsible to any Secured Party or any Person for any statements, warranties or representations (whether written or oral) made in or in connection with this Agreement, the other Program Documents or the Asset Purchase Agreement; (iii) shall not have any duty to ascertain or to inquire as to the performance or observance of any of the terms, covenants or conditions of this Agreement, the other Program Documents, the Asset Purchase Agreement or any Loan Documents on the part of the Borrower, the Adviser, the Custodian or any other Person or to inspect the property (including the books and records) of the Borrower or the Adviser; (iv) shall not be responsible to any Secured Party or any other Person for the due execution, legality, validity, enforceability, genuineness, sufficiency or value of this Agreement, the other Program Documents, any Loan Document, the Asset Purchase Agreement or any other instrument or document furnished pursuant hereto or thereto; (v) shall not be subject to any fiduciary or implied duties regardless of whether a Default or Event of Default has occurred and is continuing; (vi) shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Program Documents; provided that the Agent shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose the Agent to liability or that is contrary to any Program Document or applicable law; (vii) shall not, except as expressly set forth herein and in the other Program Documents, have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Borrower, the Adviser or any of their respective Affiliates that is communicated to or obtained by the Person servicing as the Agent or any of its Affiliates in any capacity; and (viii) shall incur no liability under or in respect of this Agreement, any other Program Document or the Asset Purchase Agreement by acting upon any notice, consent, certificate or other instrument or writing (which may be delivered by facsimile or electronic transmission) believed by it to be genuine and signed or sent by the proper party or parties. In the event that the Agent or any of its Affiliates shall be or become an indenture
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trustee under the Trust Indenture Act of 1939 (as amended, the "Trust Indenture Act") in respect of any securities issued or guaranteed by any Lender or Secondary Lender, the parties hereto acknowledge and agree that any payment or property received in satisfaction of or in respect of any Borrower Obligation hereunder or under any other Program Document by or on behalf of Citibank, N.A. in its capacity as the Agent for the benefit of any Lender or Secondary Lender under any Program Document (other than Citibank or an Affiliate of Citibank) and which is applied in accordance with the Program Documents shall be deemed to be exempt from the requirements of Section 311 of the Trust Indenture Act pursuant to Section 311(b)(3) of the Trust Indenture Act.
SECTION 8.04. Indemnification.
Each of the Lenders and the Secondary Lenders agrees to indemnify and hold the Agent harmless (to the extent not reimbursed by or on behalf of the Borrower) from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever which may be imposed on, incurred by, or asserted against the Agent in any way relating to or arising out of this Agreement, any other Program Document or the Asset Purchase Agreement or any action taken or omitted by the Agent under this Agreement, any other Program Document or the Asset Purchase Agreement; provided, that no Secured Party shall be liable for any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements resulting from the Agent's gross negligence or willful misconduct. Without limitation of the foregoing, each of the Lenders and the Secondary Lenders agrees to reimburse the Agent promptly upon demand for any out-of-pocket expenses (including reasonable counsel fees) incurred by the Agent in connection with the administration or enforcement (whether through negotiations, legal proceedings or otherwise) or legal advice in respect of rights or responsibilities under this Agreement, any Asset Purchase Agreement or the other Program Documents, to the extent that the Agent is not reimbursed for such expenses by or on behalf of the Borrower. Each Lender or Secondary Lender shall be obligated to pay its pro rata share of all amounts payable to the Agent under this Section 8.04. As used in this Section 8.04, the term "Pro Rata Share" in respect of any Lender and each Secondary Lender means the fraction, expressed as a percentage, the numerator of which is the Secondary Lender Commitment of such Secondary Lender and the denominator of which is the Total Commitment.
SECTION 8.05. Successor Agent.
The Agent may, upon thirty (30) days' notice to the Conduit Lenders and the Secondary Lenders, resign as Agent. If the Agent shall resign, then the Lenders during such thirty (30) day period shall appoint from among the Secondary Lenders a successor agent. If for any reason a successor agent is not so appointed and does not accept such appointment during such thirty (30) day period, the Agent may appoint a successor agent. Any resignation of the Agent shall be effective upon the appointment of a successor agent pursuant to this Section 8.05 and the acceptance of such appointment by such successor. After the effectiveness of any retiring Agent's resignation hereunder as Agent, the retiring Agent shall be discharged from its duties and obligations hereunder, under any Asset Purchase Agreement and under the other Program Documents and the provisions of this Article VIII and Section 9.04 shall continue in effect for its benefit with respect to any actions taken or omitted to be taken by it while it was Agent under this Agreement, any Asset Purchase Agreement and under the other Program Documents.
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SECTION 8.06. Delegation of Duties.
The Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Program Document by or through any one or more sub-agents appointed by the Agent. The Agent and any such sub-agent may perform any and all of its duties and exercise its rights and powers by or through their respective Related Parties. The exculpatory provisions of this Article VIII shall apply to any such sub-agent and to the Related Parties of the Agent and any such sub-agent, and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as Agent.
SECTION 8.07. Non-Reliance on Agent and Other Lenders.
Each Conduit Lender and each Secondary Lender acknowledges that it has, independently and without reliance upon the Agent or any other Conduit Lender or Secondary Lender or any of their Related Parties and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each Conduit Lender and each Secondary Lender also acknowledges that it will, independently and without reliance upon the Agent or any other Conduit Lender or Secondary Lender or any of their Related Parties and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any other Program Document or any related agreement or any document furnished hereunder or thereunder.
Article
IX
MISCELLANEOUS
SECTION 9.01. No Waiver; Modifications in Writing.
No failure or delay on the part of any Secured Party exercising any right, power or remedy hereunder or with respect to the Advances shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power or remedy preclude any other or further exercise thereof or the exercise of any other right, power or remedy. The remedies provided for herein are cumulative and are not exclusive of any remedies that may be available to any Secured Party, at law or in equity. No amendment, modification, supplement, termination or waiver of this Agreement shall be effective unless the same shall be in writing and signed by the Borrower and the Agent. If any Advances made by a Conduit Lender are outstanding, the Agent shall give written notice to S&P prior to the effectiveness of any material amendment or modification of this Agreement or any other Program Document to which a Conduit Lender is a party. Any waiver of any provision of this Agreement, and any consent to any departure by the Borrower from the terms of any provision of this Agreement, shall be effective only in the specific instance and for the specific purpose for which given. No notice to or demand on the Borrower in any case shall entitle the Borrower to any other or further notice or demand in similar or other circumstances.
SECTION 9.02. Notices, Etc.
Except where telephonic instructions are authorized herein to be given, all notices, demands, instructions and other communications required or permitted to be given to or made upon any party hereto shall be in writing and shall be personally delivered or sent by registered, certified or express mail, postage prepaid, or by facsimile transmission, or by
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electronic transmission, or by prepaid courier service, and shall be deemed to be given for purposes of this Agreement on the day that such writing is received by the intended recipient thereof in accordance with the provisions of this Section 9.02. Unless the Agent otherwise prescribes, all notices, demands, requests, consents and other communications described in this Section 9.02 shall be effective (i) if delivered by hand, including any overnight courier service, upon personal delivery, (ii) if delivered by mail, when deposited in the mails, (iii) if delivered by electronic mail, when transmitted to an electronic mail address (or by another means of electronic delivery) as provided in the preceding clause; provided, however, that notices and communications to the Agent, as the case may be, pursuant to Article II or Article VIII shall not be effective until received by the Agent; provided, further that, for both clauses (i) and (iii), if such notice, e-mail or other communication is not sent during the normal business hours of the recipient, such notice, electronic mail or electronic communication shall be deemed to have been sent at the opening of business on the next Business Day for the recipient. Unless otherwise specified in a notice sent or delivered in accordance with the foregoing provisions of this Section 9.02, notices, demands, instructions and other communications in writing shall be given to or made upon the respective parties hereto at their respective addresses (or to their respective facsimile numbers or electronic mail addresses) indicated below, and, in the case of telephonic instructions or notices, by calling the telephone number or numbers indicated for such party below:
|
If to CAFCO, CHARTA CIESCO, or CRC: |
Citibank, N.A. 1615 Brett Road Ops Building 3 New Castle, DE 19720 Attention: Global Loans – Conduit Operations Telephone No.: (302) 323-3125 Email: conduitoperations@citi.com |
| With a copy to: |
c/o Citibank, N.A. 750 Washington Boulevard Stamford, CT 06901 Attention: Robert Kohl Telephone No.: (203) 975-6383 Facsimile No.: (914) 274-9038 Email: robert.kohl@citi.com |
| With a copy to: |
Citibank, N.A. 388 Greenwich Street, 7th Floor New York, New York 10013 Attention: Junette Earl Telephone No.: (212) 723-3704 Facsimile No.: (646) 843-3661 Email: junette.m.earl@citi.com
|
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| If to the Agent: |
Citibank, N.A. 388 Greenwich Street, 7th Floor New York, New York 10013 Attention: Junette Earl Telephone No.: (212) 723-3704 Facsimile No.: (646) 843-3661 Email: junette.m.earl@citi.com
|
| With a copy to: |
Citibank, N.A. 750 Washington Boulevard Stamford, CT 06901 Attention: Robert Kohl Telephone No. (203) 975-6383 Facsimile No. (914) 274-9038 Email: robert.kohl@citi.com
|
| If to Citibank: |
Citibank, N.A. 388 Greenwich Street, 7th Floor New York, New York 10013 Attention: Junette Earl Telephone No.: (212) 723-3704 Facsimile No.: (646) 843-3661 Email: junette.m.earl@citi.com
|
| With a copy to: |
Citibank, N.A. 750 Washington Boulevard Stamford, CT 06901 Attention: Robert Kohl Telephone No. (203) 975-6383 Facsimile No. (914) 274-9038 Email: robert.kohl@citi.com |
| If to the Borrower: |
Eaton Vance Senior Income Trust c/o Eaton Vance Management Two International Place Boston, MA 02110-4104 Attention: Chief Legal Officer Telephone No.: (617) 672-8305 Facsimile No.: (617) 672-1305 |
| If to S&P: |
Standard & Poor's Ratings Group 55 Water Street New York, New York 10041 Attention: CDO Leveraged Fund Surveillance Telephone No.: (212) 438-5056 Email: CDOLeveragedFundSurveillance@sandp.com
|
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SECTION 9.03. Taxes.
(a) Any and all payments by the Borrower under this Agreement, the Advance Notes or any other Program Document (other than any Loan Document) shall be made, in accordance with this Agreement, free and clear of and without deduction for any and all present or future taxes, levies, imposts, deductions, charges or withholdings, and all liabilities with respect thereto, excluding, in the case of the Secured Parties, (i) United States federal withholding taxes and (ii) income and franchise taxes imposed on it by any taxing Authority in any jurisdiction which asserts jurisdiction to impose such taxes on the basis of contacts which the Secured Party in question maintains with such jurisdiction other than contacts arising out of the execution, delivery or performance of the Program Documents (other than the Loan Documents) or the transactions contemplated thereby (all such non-excluded taxes, levies, imposts, deductions, charges, withholdings and liabilities being hereinafter referred to as "Taxes"). If the Borrower shall be required by law to deduct any Taxes from or in respect of any sum payable hereunder, under any Advance Note or under any other Program Document (other than any Loan Document) to any Secured Party, (i) the sum payable shall be increased as may be necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section 9.03) such Secured Party receives an amount equal to the sum it would have received had no such deductions been made, (ii) the Borrower shall make such deductions and (iii) the Borrower shall pay the full amount deducted to the relevant taxation authority or other authority in accordance with Applicable Law.
(b) In addition, the Borrower agrees to pay any present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies which arise from any payment made by the Borrower hereunder, under the Advance Notes or under any other Program Document or from the execution, delivery or registration of, or otherwise with respect to, this Agreement, the Advance Notes or under any other Program Document (hereinafter referred to as "Other Taxes").
(c) The Borrower will indemnify each of the Secured Parties for the full amount of Taxes or Other Taxes (including, without limitation, any Taxes or Other Taxes imposed by any jurisdiction on amounts payable under this Section 9.03) paid by any Secured Party in respect of the Borrower and any liability (including penalties, interest and expenses) arising therefrom or with respect thereto, whether or not such Taxes or Other Taxes were correctly or legally asserted. This indemnification shall be made within thirty (30) days from the date the Secured Party makes written demand therefor to the Borrower.
(d) Within thirty (30) days after the date of any payment of Taxes or Other Taxes, the Borrower will furnish to the Agent the original or a certified copy of a receipt evidencing payment thereof.
(e) Without prejudice to the survival of any other agreement of the Borrower hereunder, the agreement and obligations of the Borrower contained in this Section 9.03 shall survive the termination of this Agreement and the payment in full of principal and Yield hereunder and under the Advance Notes.
(f) Each Secured Party shall use reasonable efforts to avoid the imposition of any Taxes for which the Borrower is required to pay additional amounts pursuant to this Section 9.03; provided, however, that such efforts shall not require any Secured Party to, in its reasonable judgment, incur any economic, legal, regulatory or other disadvantage.
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SECTION 9.04. Costs and Expenses; Indemnification.
(a) The Borrower agrees to promptly pay on demand all reasonable costs and expenses of each of the Secured Parties (including, without limitation, the fees and disbursements of counsel (whether through negotiations, legal proceedings or otherwise)), in connection with the preparation, review, negotiation, reproduction, execution, delivery, administration, modification, amendment, restructuring and enforcement of this Agreement, the Advance Notes or any other Program Document, including, without limitation, the reasonable out of pocket fees and disbursements of counsel for the Secured Parties with respect thereto and with respect to advising the Secured Parties, as to its rights, remedies and responsibilities under this Agreement, any Asset Purchase Agreement and the other Program Documents, all actuarial fees, UCC filing fees, the fees of S&P, Moody’s or any other rating agency that rates the commercial paper notes or other debt securities of any Conduit Lender, periodic auditing fees and expenses, regulatory costs associated with capital adequacy and all other related fees and expenses.
(b) In addition, the Borrower shall pay on demand (i) any and all commissions of placement agents and commercial paper dealers in respect of commercial paper notes issued to fund the Advances, (ii) any and all costs and expenses of any issuing and paying agent or other Person responsible for the administration of the Lender’s commercial paper program in connection with the preparation, completion, issuance, delivery or payment of commercial paper notes issued to fund the Advances, and (iii) in connection with the transaction contemplated by the Program Documents, the applicable pro-rata costs and expenses of the rating agencies’ rating the Lender’s commercial paper notes.
(c) The Borrower agrees to indemnify and hold harmless each Secured Party and each of their Affiliates and the respective officers, directors, employees, agents, managers of, and any Person controlling any of, the foregoing (each, an "Indemnified Party") from and against any and all claims, damages, losses, liabilities, obligations, expenses, penalties, actions, suits, judgments and disbursements of any kind or nature whatsoever, (including, without limitation, the reasonable fees and disbursements of counsel) (collectively the "Liabilities") that may be incurred by or asserted or awarded against any Indemnified Party, in each case arising out of or in connection with or by reason of the execution, delivery, enforcement, performance, administration of or otherwise arising out of or incurred in connection with this Agreement, any Loan Document or any other Program Document or any transaction contemplated hereby or thereby (and regardless of whether or not any such transactions are consummated), including, without limitation any such Liability that is incurred or arises out of or in connection with, or by reason of any one or more of the following: (i) preparation for a defense of, any investigation, litigation or proceeding arising out of, related to or in connection with this Agreement or any other Program Document or any of the transactions contemplated hereby or thereby; (ii) any breach or alleged breach of any covenant by the Borrower, the Adviser or the Custodian contained in any Program Document; (iii) any representation or warranty made or deemed made by the Borrower or the Custodian, contained in any Program Document or in any certificate, statement or report delivered in connection therewith is, or is alleged to be, false or misleading; (iv) any failure by the Borrower, the Adviser or the Custodian to comply with any Applicable Law or contractual obligation binding upon it; (v) any failure to vest, or delay in vesting, in the Secured Parties a first priority perfected security interest in all of the Pledged Collateral; (vi) any action or omission, not expressly authorized by the Program Documents, by the Borrower, the Adviser or the Custodian, which has the effect of reducing or impairing the Pledged Collateral or the rights of the Agent or the Secured Parties with respect thereto; (vii) any Default or Event of Default; and (viii) any transactions related to the funding, carrying or repayment of the
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outstanding principal amount of the Advances in connection with the Program Documents; except to the extent any such Liability is found in a final, non-appealable judgment by a court of competent jurisdiction to have resulted from such Indemnified Party's gross negligence or willful misconduct.
(d) Without prejudice to the survival of any other agreement of the Borrower hereunder, the agreements and obligations of the Borrower contained in this Section 9.04 shall survive the termination of this Agreement and the payment in full of principal and Yield on the Advances.
SECTION 9.05. Execution in Counterparts.
This Agreement may be executed in any number of counterparts and by different parties hereto on separate counterparts, each of which counterparts, when so executed and delivered, shall be deemed to be an original and all of which counterparts, taken together, shall constitute but one and the same agreement.
SECTION 9.06. Assignability.
(a) This Agreement and each Conduit Lender’s rights and obligations herein (including the outstanding Advances) shall be assignable by such Conduit Lender and its successors and assigns to an Eligible Assignee with the prior consent of the Borrower (which consent shall not be unreasonably withheld or delayed); provided, that the consent of the Borrower shall not be required for any such assignment by a Conduit Lender to any financial or other institution which is a Person managed by Citibank or any of its Affiliates; provided further that the Borrower shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to the Agent within five (5) Business Days after having received notice thereof. Each such assignor shall notify the Agent and the Borrower of any such assignment. Each such assignor may, in connection with the assignment or participation, disclose to the assignee or participant any information relating to the Borrower, including the Pledged Collateral, furnished to such assignor by or on behalf of the Borrower or by the Agent; provided that, prior to any such disclosure, the assignee or participant agrees to preserve the confidentiality of any confidential information relating to the Borrower received by it from any of the foregoing entities. Notwithstanding the foregoing, without the consent of the Borrower, each Conduit Lender may, pursuant to the Asset Purchase Agreement or otherwise, sell, assign, transfer and convey all or any portion of the Advances maintained by such Conduit Lender, together with all rights hereunder, under any Asset Purchase Agreement and under the Program Documents in respect thereof, to Citibank and any other bank or financial institution which is also a Secondary Lender. The Borrower hereby agrees and consents to the pledge, assignment and/or granting of a security interest by each Conduit Lender in or of all of its rights under, interest in, title to and obligations under this Agreement and the other Program Documents to its collateral agent or trustee under such Conduit Lender's commercial paper note program.
(b) Each Secondary Lender may, with the consent of the Borrower (which consent shall not be unreasonably withheld or delayed and which consent shall, in any event, not be required if a an Event of Default shall have occurred and be continuing), assign to any Eligible Assignee or to any other Secondary Lender all or a portion of its rights and obligations under this Agreement (including, without limitation, all or a portion of its Secondary Lender Commitment and the outstanding Advances or interests therein owned by it); provided, that the Borrower's consent to any such assignment shall not be required if the assignee is an existing
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Secondary Lender or a U.S. Affiliate of an existing Secondary Lender that is an Eligible Assignee; provided further that the Borrower shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to the Agent and such Secondary Lender within five (5) Business Days after having received notice thereof. The parties to each such assignment shall execute and deliver to the Agent an Assignment and Acceptance. Notwithstanding the foregoing, any Secondary Lender may at any time pledge or grant a security interest in all or a portion of its rights (including, without limitation, rights to payment of principal and Yield on the Advances) under this Agreement to secure obligations of such Secondary Lender to a Federal Reserve Bank without notice to or consent of the Borrower or the Agent.
(c) This Agreement and the rights and obligations of the Agent herein may be assignable by the Agent and its successors and assigns with the prior written consent of the Borrower (which consent shall not be unreasonably withheld or delayed); provided, that the consent of the Borrower shall not be required for any such assignment by the Agent to any financial or other institution which is Citibank or an Affiliate of Citibank or a Person managed by Citibank or any of its Affiliates; provided further that the Borrower shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to the Agent and such Secondary Lender within five (5) Business Days after having received notice thereof.
(d) The Borrower may not assign its rights or obligations hereunder or any interest herein without the prior written consent of the Agent.
(e) The Borrower acknowledges and agrees that the Secondary Lender's source of funds may derive in part from its participants. Accordingly, references in Sections 2.07, 2.08, 2.09, 9.03 and 9.04 and the other terms and provisions of this Agreement, any Asset Purchase Agreement and the other Program Documents to rates, determinations, reserve and capital adequacy requirements, expenses, increased costs, reduced receipts and the like as they pertain to the Secondary Lenders shall be deemed also to include those of each of its participants; provided that the Borrower shall not be required to reimburse a participant of a Secondary Lender pursuant to Sections 2.07, 2.08, 2.09, 9.03 and 9.04 in an amount in excess of the amount that would have been payable to such Secondary Lender had such participation not been made.
(f) The Agent shall maintain at its address specified in Section 9.02 or such other address as the Agent shall designate in writing to the Lenders and Secondary Lenders, a copy of this Agreement and each signature page hereto and each Assignment and Acceptance delivered to and accepted by it and a register (the "Register") for the recordation of the names and addresses of the Secondary Lenders, their Secondary Lender Commitment, effective dates and Secondary Lender Stated Expiration Date, and the aggregate outstanding principal amount of the outstanding Advances made by each Secondary Lender under this Agreement. The entries in the Register shall be conclusive and binding for all purposes, absent manifest error, and the Borrower, the Agent and the Secondary Lenders may treat each person whose name is recorded in the Register as a Secondary Lender hereunder for all purposes of this Agreement. The Register shall be available for inspection by the Borrower or any Secondary Lender at any reasonable time and from time to time upon reasonable prior notice.
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SECTION 9.07. Governing Law.
THIS AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK, AND FOR ALL PURPOSES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF SAID STATE.
SECTION 9.08. Severability of Provisions.
Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof or affecting the validity or enforceability of such provision in any other jurisdiction.
SECTION 9.09. Confidentiality.
(a) Until the day that is one (1) year after the Program Termination Date, the Borrower agrees that it shall and shall cause each of its Affiliates (i) to keep this Agreement, the Control Agreement, the Fee Letter, the Letter Agreement, the proposal relating to the structure of the facility contemplated by this Agreement and the other Program Documents (other than the Loan Documents), (the "Facility"), any analyses, computer models, information or document prepared by the Agent, Citibank or any of their Affiliates in connection with the Facility, the Agent’s or its Affiliate’s written reports to the Borrower, the Adviser or any of their respective Affiliates and any related written information (collectively, the "Product Information") confidential and to disclose Product Information only to those of its officers, employees, agents, trustees, accountants, legal counsel and other representatives (collectively, the "Borrower Representatives") who have a need to know such Product Information for the purpose of assisting in the negotiation, completion and administration of the Facility; (ii) to use the Product Information only in connection with the Facility and not for any other purpose; and (iii) to cause the Borrower Representatives to comply with the provisions of this Section 9.09 and to be responsible for any failure of any Borrower Representative to so comply. The Borrower shall not disclose Product Information to any third-party for the purpose of enabling such third-party to provide senior debt to the Borrower.
The provisions of this Section 9.09(a) shall not apply to any Product Information that is a matter of general public knowledge or that has heretofore been made available to the public by any Person other than the Borrower, the Adviser, any of their respective Affiliates or any Borrower Representative, that was or becomes available to the receiving party on a non-confidential basis from a source that is not known to such receiving party to be subject to confidentiality restrictions with respect to such Product Information, or that is required to be disclosed by applicable law or regulation or is requested by any Authority with jurisdiction over the Borrower, the Adviser, any Borrower Representative or any of their respective Affiliates, it being understood that any such disclosure or filing shall not relieve the Borrower, the Adviser, any of their respective Affiliates or any Borrower Representative of any of its obligations under this Section 9.09(a). Each of the Borrower and the Adviser agree that if any Product Information is required by applicable law or regulation to be included by it in any filing with the SEC or any other Authority it shall, in consultation with the Agent, use its reasonable best efforts to "black-out" all information which is not necessary under applicable law or regulation to be included in such filing which the Agent deems is of a sensitive nature and in no event shall the Fee Letter or the Investor Report be disclosed in any such filing.
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(b) Until the day that is one (1) year after the Program Termination Date, each of the Secured Parties agrees (i) to keep all non-public information with respect to the Borrower and the Adviser and their respective Affiliates which such Secured Party receives pursuant to the Program Documents (collectively, the "Borrower Information") confidential and to disclose Borrower Information only to those of its officers, employees, agents, accountants, legal counsel and other representatives of the Secured Parties (collectively, the "Secured Party Representatives"), to providers of program-wide credit enhancement for a Conduit Lender, to any actual or potential subordinated investor in a Conduit Lender or liquidity provider if such investor or liquidity provider, as the case may be, has signed a confidentiality agreement substantially on the terms of this Section 9.09(b), to any other Person with the prior written consent of the Borrower, and to S&P, Moody’s or any other rating agency that rates the promissory notes of a Conduit Lender which, in each case, may have a need to know or review such Borrower Information for the purpose of assisting in the negotiation, completion, administration and evaluation of the Facility; (ii) to use the Borrower Information only in connection with the Facility and not for any other purpose; and (iii) to cause its related Secured Party Representatives to comply with the provisions of this Section 9.09(b) and to be responsible for any failure of any Secured Party Representative to so comply.
The provisions of this Section 9.09(b) shall not apply to any Borrower Information that is a matter of general public knowledge or that has heretofore been made available to the public by any Person other than any Secured Party or any Secured Party Representative, that was or becomes available to the receiving party on a non-confidential basis from a source that is not known to such receiving party to be subject to confidentiality restrictions with respect to such Borrower Information, or that is required to be disclosed by applicable law or regulation or is requested by any Authority with jurisdiction over any Secured Party or Secured Party Representative or any of its Affiliates. Without limiting the foregoing, nothing contained in this Section 9.09 (b) shall serve to (i) restrict any brokerage, research, investment management or trading activities conducted in the ordinary course of business (which includes arbitrage activities) by a Secured Party, its employees or any other Affiliates of such Secured Party either for their own account or for the accounts of their customers; or (ii) restrict any investment banking and merger/acquisition activity performed in the ordinary course of the business of such Secured Party or its Affiliates; provided that with respect to (i) or (ii) above, the individuals engaged in any of the foregoing activities have not reviewed the Borrower Information or otherwise been informed by those who have reviewed it or the contents thereof.
Notwithstanding the foregoing, the Borrower Information may be disclosed by any Secured Party Representative to permitted assignees and participants and potential assignees and participants in the Facility to the extent such disclosure is made pursuant to a written agreement of confidentiality substantially similar to this Section 9.09(b).
(c) Notwithstanding anything in this Section 9.09 to the contrary, the parties hereto (and each of their respective employees, representatives or other agents) may disclose to any and all Persons, without limitation of any kind, the "tax treatment" and "tax structure" (in each case within the meaning of Treasury Regulation Section 1.6011-4) of the Facility and all materials of any kind (including opinions or other tax analyses) that are provided to it, relating to such tax treatment and tax structure of the Facility.
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SECTION 9.10. Merger.
The Program Documents taken as a whole incorporate the entire agreement between the parties thereto concerning the subject matter thereof. The Program Documents supersede any prior agreements among the parties relating to the subject matter thereof.
SECTION 9.11. No Proceedings; No Recourse.
Each of the Borrower, the Agent, the Secondary Lenders and each assignee of an Advance or any interest therein and each entity which enters into a commitment to make Advances to the Borrower hereunder hereby agrees that it will not institute against any Conduit Lender any proceeding of the type referred to in Section 6.01(f) so long as any commercial paper or other senior indebtedness issued by such Conduit Lender shall be outstanding or there shall not have elapsed one year plus one day since the last day on which any such commercial paper or other senior indebtedness shall have been outstanding. The obligations of each Conduit Lender under and in connection with this Agreement and the other Program Documents are solely the obligations of such Conduit Lender. It is expressly agreed that no recourse shall be had for the payment of any amount owing in respect of this Agreement or any other Program Document or for any other obligation or claim arising out of or based upon this Agreement or any other Program Document, against any member, stockholder, employee, officer, manager, director, organizer or incorporator of the Conduit Lenders or against any member, stockholder, employee, officer, manager, director, organizer or incorporator of any such member, stockholder or manager.
SECTION 9.12. Survival of Representations and Warranties.
All representations and warranties made hereunder, in the other Program Documents and in any document, certificate or statement delivered pursuant hereto or thereto or in connection herewith or therewith shall survive the execution and delivery of this Agreement and the making of the Advances hereunder. The agreements in Sections 9.03, 9.04, 9.09, 9.11 and 9.12 shall survive the termination of this Agreement.
SECTION 9.13. Loan Documents.
No obligation or liability of the Borrower is intended to be assumed by the Agent or any other Secured Party under or as a result of this Agreement or the other Program Documents, and the transactions contemplated hereby and thereby, including, without limitation, under any Loan Document and, to the maximum extent permitted under provisions of law, the Agent and the other Secured Parties expressly disclaim any such assumption. The Borrower shall indemnify, defend and hold harmless the Agent and the other Secured Parties from any loss, liability or expense incurred as a result of any claim that any such obligation or liability has been so assumed.
If an Event of Default under Section 6.01(f) in respect of the Borrower shall have occurred and is continuing or the Agent shall have delivered a Notice of Exclusive Control to the Custodian, and such notice has not been revoked by the Agent, the Borrower will use its best efforts to obtain and give all necessary consents under all Loan Documents relating to any Pledged Collateral and execute and deliver all agreements and documents which are necessary or appropriate in order to enable the Secured Parties to enforce their rights and remedies hereunder and under the other Program Documents, including without limitation, to permit the Pledged
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Collateral which constitutes Loan Assets to be assigned to the Agent or its designees. In addition, the Borrower shall pay all assignment fees which are required to be paid pursuant to the Loan Documents relating to the Pledged Collateral in connection with the foregoing. The Agent and the Secured Parties acknowledge that in order to enforce certain of their remedies in respect of the Pledged Collateral which constitutes Loan Assets after the occurrence of an Event of Default, certain provisions of the related Loan Documents may need to be complied with, including provisions requiring the consent of the related Transaction Agent and/or Obligor.
The Agent agrees that if it would be prevented from reviewing any Loan Document relating to an Eligible Debt Security in connection with the exercise of its rights under this Agreement, as a result of any confidentiality agreement entered into by the Borrower in respect thereof, and if its review of such Loan Documents would be permitted if it agrees to maintain the confidentiality of such Loan Documents in accordance with the terms of such confidentiality agreement (each such confidentiality agreement a "Subject Confidentiality Agreement"), the Agent hereby agrees to abide by the terms of such Subject Confidentiality Agreement in respect of such Loan Documents.
SECTION 9.14. Submission to Jurisdiction; Waivers; Etc.
The Borrower hereby irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or proceeding relating to this Agreement or the other Program Documents to which it is a party, or for recognition and enforcement of any judgment in respect thereof, to the exclusive general jurisdiction of the courts of the State of New York sitting in the Borough of Manhattan in the City of New York, the courts of the United States of America for the Southern District of New York, and the appellate courts of any of them;
(b) consents that any such action or proceeding may be brought in any of such courts and waives any objection that it may now or hereafter have to the venue of any such action or proceeding in any such court or that such action or proceeding was brought in an inconvenient court and agrees not to plead or claim the same;
(c) agrees that service of process in any such action or proceeding may be effected by mailing a copy thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, to the Borrower at its address set forth in Section 9.02 or at such other address as may be permitted thereunder;
(d) agrees that nothing herein shall affect the right to effect service of process in any other manner permitted by law or shall limit the right to sue in any other jurisdiction or court;
(e) to the fullest extent permitted by applicable law, agrees not to assert, and hereby waives, any claim against any Secured Party, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Program Document or any agreement or instrument contemplated hereby, the transactions contemplated hereby or thereby, any Advance or the use of the proceeds thereof. No Secured Party shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed by it through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Program Documents or the transactions contemplated hereby or thereby; and
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(f) acknowledges and agrees that in addition to any right of setoff, banker's lien or counterclaim a Secured Party may otherwise have, each Secured Party shall be entitled, at its option, to set-off any amount owing by it to the Borrower or any balances held by it for the account of the Borrower against any Borrower Obligations which are not paid when due.
SECTION 9.15. E-Mail Reports.
Subject to the following terms and conditions the Borrower may, unless otherwise notified to the contrary by the Agent, transmit Investor Reports and weekly officer's certificates to the Agent by electronic mail (each an "E-Mail Report"). Each E-Mail Report shall be formatted as the Agent may designate from time to time. Each E-Mail Report shall be sent to the Agent at an electronic mail address designated by the Agent, and the executed "summary sheet" for each E-Mail Report shall be transmitted via facsimile transmission to the Agent at the facsimile numbers specified for the Agent in Section 9.02.
SECTION 9.16. Waiver of Jury Trial.
EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER PROGRAM DOCUMENT OR FOR ANY COUNTERCLAIM THEREIN OR RELATING THERETO.
SECTION 9.17. Several Obligations.
Except for the commitment of the Secondary Lenders to make Advances if a Conduit Lender has declined to make an Advance to the extent expressly required by Section 2.02, no Lender or Secondary Lender shall be responsible for the failure of any other Lender or Secondary Lender to make any Advance or to perform any obligation on this Agreement, any Asset Purchase Agreement or any other Program Document. The Agent shall not have any liability to the Borrower, any Lender or any Secondary Lender for the Borrower's, any Lender's or any Secondary Lender's, as the case may be, performance of, or failure to perform, any of their respective obligations and duties under this Agreement, any Asset Purchase Agreement or any other Program Document. The Agent shall not have any liability to the Borrower, any Lender or any Secondary Lender for the Borrower's, any Lender's or any Secondary Lender's, as the case may be, performance of, or failure to perform, any of their respective obligations and duties under this Agreement or any other Program Document.
SECTION 9.18. Limitation on Liability.
The Borrower's Declaration of Trust is on file with the Secretary of the Commonwealth of Massachusetts. This Agreement is executed on behalf of the Borrower by the Borrower's officers as officers and not individually and the obligations imposed upon the Borrower by this Agreement are not binding upon any of the Borrower's trustees, officers, directors, shareholders, beneficiaries or other equity holders individually but are binding only upon the assets and property of the Borrower.
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SECTION 9.19. Patriot Act Notice.
Each of the Lenders hereby notifies the Borrower that pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law on October 26, 2001)) (the “Patriot Act”), it is required to obtain, verify and record information that identifies the Borrower, which information includes the name and address of the Borrower and other information that will allow such Lender to identify the Borrower in accordance with the Patriot Act. The Borrower shall, and shall cause each of its subsidiaries, if any, to, provide to the extent commercially reasonable, such information and take such actions as are reasonably requested by any Lender in order to assist such Lender in maintaining compliance with the Patriot Act.
SECTION 9.20. Certain ERISA Matters.
(a) Each Lender and Secondary Lender (x) represents and warrants, as of the date such Person became a Lender or Secondary Lender party hereto, to, and (y) covenants, from the date such Person became a Lender or Secondary Lender party hereto to the date such Person ceases being a Lender or Secondary Lender party hereto, for the benefit of, the Agent and its Affiliates, and not, for the avoidance of doubt, to or for the benefit of the Borrower, that at least one of the following is and will be true:
(i) such Lender or Secondary Lender is not a “benefit plan investor” (within the meaning of Section 3(42) of ERISA) or otherwise using “plan assets” (within the meaning of 29 CFR § 2510.3-101, as modified by Section 3(42) of ERISA) of one or more Benefit Plans in connection with the Advances or the Secondary Lender Commitments,
(ii) the transaction exemption set forth in one or more PTEs, such as PTE 84-14 (a class exemption for certain transactions determined by independent qualified professional asset managers), PTE 95-60 (a class exemption for certain transactions involving insurance company general accounts), PTE 90-1 (a class exemption for certain transactions involving insurance company pooled separate accounts), PTE 91-38 (a class exemption for certain transactions involving bank collective investment funds) or PTE 96-23 (a class exemption for certain transactions determined by in-house asset managers), is applicable with respect to such Lender’s or Secondary Lender’s entrance into, participation in, administration of and performance of the Advances, the Secondary Lender Commitments and this Agreement,
(iii) (A) such Lender or Secondary Lender is an investment fund managed by a “Qualified Professional Asset Manager” (within the meaning of Part VI of PTE 84-14), (B) such Qualified Professional Asset Manager made the investment decision on behalf of such Lender or Secondary Lender to enter into, participate in, administer and perform the Advances, the Secondary Lender Commitments and this Agreement, (C) the entrance into, participation in, administration of and performance of the Advances, the Secondary Lender Commitments and this Agreement satisfies the requirements of sub-sections (b) through (g) of Part I of PTE 84-14 and (D) to the best knowledge of such Lender or Secondary Lender, the requirements of subsection (a) of Part I of PTE 84-14 are satisfied with respect to such Lender’s or Secondary Lender’s entrance into, participation in, administration of and performance of the Advances, the Secondary Lender Commitments and this Agreement, or
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(iv) such other representation, warranty and covenant as may be agreed in writing between the Agent, in its sole discretion, and such Lender or Secondary Lender.
(b) In addition, unless sub-clause (i) in the immediately preceding clause (a) is true with respect to a Lender or Secondary Lender, such Lender or Secondary Lender further (x) represents and warrants, as of the date such Person became a Lender or Secondary Lender party hereto, to, and (y) covenants, from the date such Person became a Lender or Secondary Lender party hereto to the date such Person ceases being a Lender or Secondary Lender party hereto, for the benefit of, the Agent and its Affiliates, and not, for the avoidance of doubt, to or for the benefit of the Borrower, that:
(i) none of the Agent or any of its Affiliates is a fiduciary under ERISA or the Code with respect to the assets of such Lender or Secondary Lender in connection with such Lender’s or Secondary Lender’s entrance into, participation in, administration of and performance of the Advances, the Secondary Lender Commitments and this Agreement (including in connection with the reservation or exercise of any rights by the Agent under this Agreement, any Program Document or any documents related hereto or thereto),
(ii) the Person making the investment decision on behalf of such Lender or Secondary Lender with respect to the entrance into, participation in, administration of and performance of the Advances, the Secondary Lender Commitments and this Agreement is independent (within the meaning of 29 CFR § 2510.3-21) and is a bank, an insurance carrier, an investment adviser, a broker-dealer or other person that holds, or has under management or control, total assets of at least $, in each case as described in 29 CFR § 2510.3-21(c)(1)(i)(A)-(E),6
(iii) the Person making the investment decision on behalf of such Lender or Secondary Lender with respect to the entrance into, participation in, administration of and performance of the Advances, the Secondary Lender Commitments and this Agreement is capable of evaluating investment risks independently, both in general and with regard to particular transactions and investment strategies (including in respect of the Borrower Obligations),
(iv) the Person making the investment decision on behalf of such Lender or Secondary Lender with respect to the entrance into, participation in, administration of and performance of the Advances, the Secondary Lender Commitments and this Agreement is a fiduciary under ERISA or the Code, or both, with respect to the Advances, the Secondary Lender Commitments and this Agreement and is responsible for exercising independent judgment in evaluating the transactions hereunder, and
(v) no fee or other compensation is being paid directly to the Agent or any of its Affiliates for investment advice (as opposed to other services) in connection with the Advances, the Secondary Lender Commitments, or this Agreement.
(c) The Agent hereby informs the Lenders and the Secondary Lenders that the Agent is not undertaking to provide impartial investment advice, or to give advice in a fiduciary capacity, in connection with the transactions contemplated hereby, and that the Agent has a financial interest in the transactions contemplated hereby in that the Agent or its Affiliates (i) may receive interest or other payments with respect to the Advances, the Secondary Lender Commitments and this Agreement, (ii) may recognize a gain if it extended the Advances or the
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Secondary Lender Commitments, as applicable, for an amount less than the amount being paid for an interest in the Advances or the Secondary Lender Commitments by such Lender or Secondary Lender or (iii) may receive fees or other payments in connection with the transactions contemplated hereby, the Program Documents or otherwise, including structuring fees, commitment fees, arrangement fees, facility fees, upfront fees, underwriting fees, ticking fees, agency fees, agent or collateral agent fees, utilization fees, minimum usage fees, letter of credit fees, fronting fees, deal-away or alternate transaction fees, amendment fees, processing fees, term out premiums, banker’s acceptance fees, breakage or other early termination fees or fees similar to the foregoing.
SECTION 9.21. Acknowledgement and Consent to Bail-In of Affected Financial Institutions.
Notwithstanding anything to the contrary in any Program Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any Affected Financial Institution arising under any Program Document, to the extent such liability is unsecured, may be subject to the write-down and conversion powers of the applicable Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:
(a) the application of any Write-Down and Conversion Powers by the applicable Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an Affected Financial Institution; and
(b) the effects of any Bail-in Action on any such liability, including, if applicable:
(i) a reduction in full or in part or cancellation of any such liability;
(ii) a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such Affected Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Program Document; or
(iii) the variation of the terms of such liability in connection with the exercise of the write-down and conversion powers of the applicable Resolution Authority.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers thereunto duly authorized, as of the date first above written.
EATON VANCE SENIOR INCOME TRUST,
as Borrower
By:_____________________________
Name:
Title:
CHARTA, LLC,
as Conduit Lender
By: Citibank, N.A.,
Its Attorney-in-Fact
By:____________________________
Name:
Title:
CAFCO, LLC,
as Conduit Lender
By: Citibank, N.A.,
Its Attorney-in-Fact
By:____________________________
Name:
Title:
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CIESCO, LLC,
as Conduit Lender
By: Citibank, N.A.,
Its Attorney-in-Fact
By:____________________________
Name:
Title:
CRC FUNDING, LLC,
as Conduit Lender
By: Citibank, N.A.,
Its Attorney-in-Fact
By:____________________________
Name:
Title:
CITIBANK, N.A.,
as Agent
By:____________________________
Name:
Title:
CITIBANK, N.A.,
as Secondary Lender
By:____________________________
Name:
Title:
Percentage: %
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SCHEDULE I
FORM OF INVESTOR REPORT
| 1 |
SCHEDULE II
LOCATIONS OF LOAN DOCUMENTS
| 1 |
SCHEDULE III
INDUSTRY CLASSIFICATIONS
| 1 |
SCHEDULE IV
TRUSTEE INFORMATION
| 1 |
SCHEDULE 4.01(J)
PENDING LITIGATION OR OTHER PROCEEDINGS
| 1 |
SCHEDULE V
LIST OF ADVANCE RATES
| 1 |
EXHIBIT A
FORM OF ADVANCE NOTE
| A-1 |
EXHIBIT B
FORM OF NOTICE OF BORROWING
| B-1 |
EXHIBIT C
ASSIGNMENT AND ACCEPTANCE
| C-1 |
EXHIBIT D
FORM OF NOTICE OF PREPAYMENT
| D-1 |
EXHIBIT E
FORM OF NOTICE OF CONVERSION OR CONTINUATION
| E-1 |
Exhibit (d)(i)
AGREEMENT
This Agreement is entered into as of May 12, 2021 (this “Agreement” (including the exhibits hereto), by and between Saba Capital Management, L.P. (“Saba”) and Eaton Vance Management (the “Adviser” and, together with Saba, the “Parties” and, individually, a “Party”).
WHEREAS, the Eaton Vance Senior Income Trust (EVF) (the “Fund”) is a closed-end management investment company registered under the Investment Company Act of 1940, as amended (the “1940 Act);
WHEREAS, the Adviser serves as the Fund’s adviser pursuant to a management agreement between the Fund and the Adviser; and
WHEREAS, as of the close of business on May 12, 2021, Saba may be deemed to be the beneficial owner (as such term is used in Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) of, in the aggregate, 8,043,774 shares of common stock of the Fund, $0.01 par value (“Common Shares”), which includes Common Shares held by one or more private funds and accounts managed by Saba (the “Saba Private Funds”) and an open- end management investment company registered under the 1940 Act (the “ETF”) for which Saba serves as a sub-adviser. For the avoidance of doubt, the ETF is not a party to, is not restricted by and is not governed by, the terms of this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto hereby agree as follows:
Section 1. Tender Offer by the Fund
1.1 On the basis of the representations, warranties and agreements set forth herein and subject to performance by each Party of its respective covenants and other obligations hereunder and the other conditions set forth herein:
(a) The Adviser has recommended to the Fund’s Board of Trustees (the “Board”), and the Board has authorized the Fund, subject to the execution of this Agreement by all Parties, to conduct a conditional tender offer to purchase for cash 60% (the “Maximum Amount”) of its outstanding Common Shares (the “Tender Offer”). The Tender Offer shall include the following terms: (i) holders of Common Shares shall have the opportunity to tender some or all of their Common Shares at a price equal to 99% of the Fund’s net asset value per share (“NAV”) as determined as of the close of the regular trading session of the New York Stock Exchange (the “NYSE”) on the expiration date of the Tender Offer or, if the Tender Offer is extended, on the day to which the Tender Offer is extended, (ii) the Fund shall purchase Common Shares tendered and not withdrawn on a prorated basis up to the Maximum Amount if greater than the Maximum Amount of Common Shares are properly tendered and not properly withdrawn, (iii) the consideration to be paid by the Fund for Common Shares purchased under the Tender Offer shall consist solely of cash and (iv) if less than the Maximum Amount of Common Shares have been properly tendered and not withdrawn, then the Fund shall only be obligated to purchase such amount of Common Shares actually tendered. Notwithstanding anything contained in this Agreement to the contrary, in no event shall the Tender Offer commence prior to the date that a new investment advisory agreement for the Fund with the Adviser substantially in the form attached as Exhibit A is approved by the vote of a majority of the outstanding voting securities of the Fund as defined in the 1940 Act (the “Change of Control Approval”). The Tender Offer shall commence within 30 days following the Change of Control Approval and the Fund shall pay the proceeds of the Tender Offer within fifteen (15) business days after the completion of the Tender Offer.
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(b) The Tender Offer shall not provide for preferential treatment for any shareholders of the Fund.
(c) The Tender Offer shall require odd lot tenders to be subject to the same proration terms as tenders of 100 shares or more.
(d) Notwithstanding any commitment to conduct the Tender Offer under the circumstances set forth above, the Fund will not commence the Tender Offer or accept tenders of the Fund’s Common Shares during any period when (i) such transactions, if consummated, would, upon advice of counsel and determined by the Fund and counsel in good faith: (A) result in the delisting of the Fund’s shares from the NYSE or (B) impair the Fund’s status as a regulated investment company under the Internal Revenue Code of 1986, as amended (which would make the Fund a taxable entity, causing the Fund’s income to be taxed at the fund level in addition to the taxation of shareholders who receive distributions from the Fund); or (ii) there is any (A) legal or regulatory action or proceeding instituted or threatened in writing challenging such transaction, (B) suspension of or limitation on prices for trading securities generally on the NYSE or other national securities exchange(s), including the Nasdaq Stock Market and the NYSE MKT LLC or (C) declaration of a banking moratorium by federal or state authorities or any suspension of payment by banks in the United States, Massachusetts or New York State. In the event of a delay pursuant to either of clauses (i) or (ii) above or a determination not to conduct the tenders set forth herein, the Fund will (x) provide, within three (3) calendar days, written notice to Saba of any such determination not to conduct or delay the Tender Offer pursuant to this Section 1.1(d), in each case, together with a detailed analysis of the reason for such determination and reasonable support for such determination and (y) in the event of a delay, the Fund will commence the Tender Offer as soon as practicable and not later than 10 days after the termination of such delaying event.
(e) Other than in connection with regularly scheduled distributions under a dividend reinvestment plan, the Fund shall not issue any Common Shares or any securities exchangeable or convertible into Common Shares prior to the payment of the Tender Offer proceeds.
| (f) | The Adviser has recommended to the Fund’s Board of |
Trustees (the “Board”), and the Board has authorized the Fund, subject to the execution of this Agreement by all Parties, to conduct up to three additional conditional tender offers (each a “Subsequent Tender Offer”) subject to the following terms: (i) in calendar year 2022, the Fund will conduct a tender offer to purchase for cash up to 10% of its then outstanding Common Shares prior to December 31, 2022 if the average discount to the Fund’s NAV from January 2022 through August 2022 exceeds 10% based on the Fund’s volume-weighted average market price and NAV on business days during the period; (ii) in calendar year 2023, the Fund will conduct a tender offer to purchase for cash up to 10% of its then outstanding Common Shares prior to December 31, 2023 if the average discount to the Fund’s NAV from January 2023 through August 2023 exceeds 10% based on the Fund’s volume-weighted average market price and NAV on business days during the period; (iii) in calendar year 2024, the Fund will conduct a tender offer to purchase for cash up to 10% of its then outstanding Common Shares prior to December 31, 2024 if the average discount to the Fund’s NAV from January 2024 through August 2024 exceeds 10% based on the Fund’s volume-weighted average market price and NAV on business days during the period; (iv) each Subsequent Tender Offer shall provide holders of Common Shares with the opportunity to tender some or all of their Common Shares at a price equal to 98% of the Fund’s NAV as determined as of the close of the regular trading session of the NYSE on the expiration date of the Subsequent Tender Offer or, if the Subsequent Tender Offer is extended, on the date to which the Subsequent Tender Offer is extended; (v) in connection with each Subsequent Tender Offer, the Fund shall purchase Common Shares tendered and not withdrawn on a prorated basis up to 10% of the Fund’s then outstanding Common Shares if greater than 10% of the Common Shares are properly tendered and not properly withdrawn, (vi) the consideration to be paid by the Fund for Common Shares purchased in any Subsequent Tender Offer shall consist solely of
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cash, (vii) if less than 10% of the Common Shares are properly tendered and not withdrawn in connection with any Subsequent Tender Offer, the Fund shall only be obligated to purchase such amount of Common Shares actually tendered, and (viii) notwithstanding any commitment to conduct a Subsequent Tender Offer under the circumstances set forth in this Section 1.1(f), the Fund will not commence a Subsequent Tender Offer or accept tenders of the Fund’s Common Shares during any period described in 1.1(d) above, provided that the Fund will commence the Subsequent Tender Offer as soon as practicable and not later than 20 days after the termination of such delaying event.
1.2 Saba agrees to tender, or cause to be tendered, all but one of the Common Shares of which Saba or its Affiliates (as defined below) or a Saba Entity (as defined below and excluding the ETF) is the beneficial owner (as such term is used in Rule 13d-3 under the Exchange Act) in the Tender Offer and in any Subsequent Tender Offers, including, but not limited to, all of the Common Shares then owned by Saba and the Saba Private Funds and excluding the ETF. Notwithstanding the foregoing, if Saba and/or the Saba Entities would be required to disgorge their profits in respect of certain Common Shares pursuant to Section 16(b) of the Securities Exchange Act of 1934 if such Common Shares were tendered in the Tender Offer or a Subsequent Tender Offer, as the case may be, Saba and the Saba Entities shall not be obligated to tender its Common Shares. Saba represents that, as of the date of this Agreement, Saba and the Saba Parties do not own any Common Shares of the Fund that would or potentially could be subject to disgorgement of profits if the Tender Offer is completed in accordance with Section 1.1(a), and covenants that Saba and the Saba Entities will not acquire any additional Common Shares prior to completion of the Tender Offer.
Section 2. Additional Agreements
2.1 Saba covenants and agrees that from the execution of this Agreement until the Agreement is terminated pursuant to Section 4, it will not, and will cause its respective principals, directors, general partners, members, officers, employees, agents (acting on Saba’s behalf), affiliated persons (as defined in the 1940 Act and which, for the avoidance of doubt, shall exclude the ETF but shall include (without limitation) any account or other pooled investment vehicle now or in the future managed, advised or sub-advised by Saba or its affiliated persons) and representatives under Saba’s control (all such persons, collectively, the “Saba Entities”), and any other persons controlled by or under common control with Saba, Saba Capital Management GP, LLC or Boaz R. Weinstein (which shall not include the ETF) (such other persons, “Affiliates”), not to, directly or indirectly, alone or in concert with others (including, by directing, requesting or suggesting that any other person take any of the actions set forth below), unless specifically permitted in writing in advance by the Fund and the Adviser, take any of the actions with respect to the Fund as set forth below:
(a) effect, seek, offer, engage in, propose (whether publicly or otherwise and whether or not subject to conditions) or cause, participate in or act to, or assist any other person to effect, seek, engage in, offer or propose (whether publicly or otherwise) or cause, participate in or act to (other than as specifically contemplated by this Agreement):
(i) any “solicitation” of “proxies” or become a “participant” in any such “solicitation” as such terms are defined in Regulation 14A under the Exchange Act, including any otherwise exempt solicitation pursuant to clause (iv) of Rule 14a- 1(l)(2) and including any otherwise exempt solicitation pursuant to Rule 14a-2(b), in each case, with respect to securities of the Fund (including, without limitation, any solicitation of consents to act by written consent or call a special meeting of shareholders);
(ii) knowingly encourage or advise any other person or knowingly assist or act to assist any person in so encouraging or advising any person with respect to the giving or withholding of any proxy, consent or other authority to vote (other than such encouragement or advice that is consistent with the Board’s and/or Adviser’s recommendation with respect to the Fund in connection with such matter or encouragement or advice solely amongst Saba, the Saba Entities and the Affiliates) with respect to the Fund;
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(iii) engage, directly or indirectly, in any short sale that derives substantially all of its value from a decline in the market price of the Fund (for the avoidance of doubt, Saba and its Affiliates may short sell broad based indices);
(b) form, join or in any way participate in any “group” (within the meaning of Section 13(d)(3) of the Exchange Act and Rule 13d-5(b)(1) thereunder) (other than a group that consists solely of members of Saba, the Saba Entities and the Affiliates) with respect to the activities described in Sections 2.1(a)(i), 2.1(a)(ii) or 2.1(a)(iii);
(c) deposit any securities of the Fund in any voting trust or subject any securities of the Fund to any arrangement or agreement with respect to the voting of the securities of the Fund, including, without limitation, lend any securities of the Fund to any person or entity for the purpose of allowing such person or entity to vote such securities in connection with any shareholder vote or consent of the Fund or to sell such securities, other than any such voting trust, arrangement or agreement solely among the members of Saba, the Saba Entities and the Affiliates;
(d) seek, alone or in concert with others, (i) election or appointment to, or representation on, the Board of the Fund, or nominate or propose the nomination of, or recommend the nomination of, any candidate to the Board of the Fund, or (ii) the removal or resignation of any member of the Board of the Fund, or knowingly encourage any such actions in clause (i) or (ii) specifically with regard to the Fund;
(e) make any proposal for consideration by shareholders at any annual or special meeting of shareholders of the Fund (pursuant to Rule 14a-8 under the Exchange Act or otherwise), or take any action (other than in accordance with this Section 2.1 and Section 2.2) with respect to any shareholder proposal or written consent submitted prior to the date of this Agreement or during the period from the execution of this Agreement until the Agreement is terminated pursuant to Section 4;
(f) make a request for a shareholder list or other books and records of the Fund under Massachusetts or New York law or any other statutory or regulatory provision;
(g) seek to control or publicly influence the Adviser with respect to the Fund, the Board of the Fund or policies of the Fund;
(h) make any public proposal with respect to (i) any change in the number or term of directors or the filling of any vacancies on the Board of the Fund, (ii) any change in the capitalization, share purchase program, dividend policy or distribution policy of the Fund, (iii) any other material change in the Fund’s management, business or corporate structure with respect to the Fund, or (iv) any waiver, amendment or modification to the charter or bylaws of the Fund;
(i) enter into any negotiations, arrangements or understandings with any person with respect to any of the foregoing, or advise, knowingly assist or knowingly encourage others to take any action with respect to any of the foregoing; or
(j) publicly request (x) that the Fund, the Board of the Fund or any of their respective representatives amend or waive any provision of this Section 2.1 (including this sentence) or (y) the Board of the Fund to specifically invite Saba, the Saba Entities or the Affiliates to take any of the actions prohibited by this Section 2.1.
Nothing herein shall be deemed to prohibit Saba, the Saba Entities and the Affiliates from communicating privately with the directors, officers, and advisors of the Fund (including the Adviser) so long as such private communications would not be reasonably determined to trigger
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public disclosure obligations for any Party. In addition, the covenants set forth in this Section 2.1 shall not be deemed to prevent the voting of any Common Shares held by the ETF proportionately in accordance with the method prescribed in the second clause of Section 12(d)(1)(E)(iii)(aa) of the 1940 Act (“Mirror Voting”) in accordance with the proxy voting policy of the ETF.
2.2 Saba covenants and agrees that it will, and will cause the Saba Entities and the Affiliates (except, for the avoidance of doubt, the ETF) to:
(a) appear by proxy or otherwise at any meeting of shareholders of the Fund (including any postponements or adjournments thereof) related to the Change of Control Approval, and (i) cause all shares it and the Saba Entities beneficially own as of the record date for such meeting to be counted as present thereat for purposes of a quorum and (ii) vote or cause to be voted at such meeting all of the shares Saba, the Saba Entities and the Affiliates beneficially own as of the record date for such meeting (except, for the avoidance of doubt, for the ETF) in favor of the Change of Control Approval.
(b) during the period from the execution of this Agreement until the Agreement is terminated pursuant to Section 4, appear by proxy or otherwise at any meeting of shareholders of the Fund (including any postponements or adjournments thereof) at which shareholders of the Fund are being asked to consider a proposal recommended by the Fund Board to merge or otherwise reorganize the Fund into another registered investment company for which the Adviser serves as investment adviser (“Reorganization”), and (i) cause all shares it and the Saba Entities beneficially own as of the record date for such meeting to be counted as present thereat for purposes of a quorum, and (ii) vote or cause to be voted at such meeting all of the shares Saba, the Saba Entities and the Affiliates beneficially own as of the record date for such meeting (except, for the avoidance of doubt, for the ETF) in favor of such Reorganization. For the avoidance of doubt, except as set forth in Section 2.2(a) and (b), nothing in this Agreement shall require Saba, the Saba Entities and the Affiliates to vote or cause to be voted at any meeting or otherwise or requires Saba, the Saba Entities and the Affiliates to vote or cause to be voted in any specific direction (including being present for purposes of the calculation of quorum).
2.3 Upon the written request of the Fund, which shall be no more frequently than once each fiscal year of the Fund, Saba will notify the Fund in writing of the number of Common Shares beneficially owned by Saba, the Saba Entities and the Affiliates. Saba shall take all actions practical to prevent its present and future general partners, members, directors, officers, the Saba Entities and the Affiliates from engaging in conduct otherwise prohibited by this Agreement.
| 2.4 | Saba represents and warrants as follows: |
(a) It has the power and authority to execute, deliver and carry out the terms and provisions of this Agreement and to consummate the transactions contemplated hereby.
(b) This Agreement has been duly and validly authorized, executed and delivered by it and is enforceable against Saba in accordance with its terms.
(c) The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby will not contravene any provision of law applicable to it.
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(d) Saba beneficially owns, directly or indirectly, and has the power to vote all the Common Shares as described in the recitals to this Agreement (except for shares of the ETF, which shall be subject to Mirror Voting in accordance with the proxy voting policies presently in place at the ETF), and its ownership of Common Shares has at all times complied with applicable provisions of the 1940 Act.
(e) As of the date hereof, neither Saba nor any of the Saba Entities or the Affiliates is a party to any derivative securities, including without limitation any swap or hedging transactions or other derivative agreement, or any securities lending or short sale arrangements, of any nature with respect to the Common Shares.
| 2.5 | The Adviser represents and warrants as follows: |
(a) It has the power and authority to execute, deliver and carry out the terms and provisions of this Agreement.
(b) This Agreement has been duly and validly authorized, executed and delivered by it and is enforceable against it in accordance with its terms.
(c) The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby will not contravene any provision of law applicable to it.
(d) The Fund Board has taken all of the actions ascribed to it in this Agreement.
2.6 The Adviser covenants and agrees that, following the certification by the Fund’s inspector of election of the Change of Control Approval, the Adviser will promptly pay to Saba or the Affiliates, in reimbursement of its proxy solicitation costs for the proxy contest for the Fund, cash in the amount of $75,000 by wire in accordance with separate written instructions to be provided by Saba.
2.7. This Agreement is the result of an arms-length, good faith compromise and shall never at any time, for any purpose, be considered as an admission or evidence of liability or the absence of liability of any Party.
Section 3. Public Announcement
3.1 No later than one business day following the date of this Agreement, (a) the Fund shall issue one press release substantially in the form attached as Exhibit B (the “Fund Press Release”) and (b) Saba shall issue one press release substantially in the form attached as Exhibit C (the “Saba Press Release” and, together with the Fund Press Release, the “Press Releases”), and no party shall make any public statement inconsistent with the Press Releases during the period from the date this Agreement is executed until the termination of this Agreement, as described in Section 4. No party shall issue additional press releases in connection with this Agreement or the actions contemplated hereby without the prior written consent of the other party except as provided below. Nothing in this Agreement shall limit or prevent (a) any Party from taking any action required by any governmental or regulatory authority (except to the extent such requirement arose by discretionary acts by any Party), including without limitation any statements, filings, notices or announcements made in the context of an issuer tender offer conducted under Section 13(e)(1) of, or pursuant to Schedule TO under, the Exchange Act, (b) the Fund or the Adviser from issuing any press releases or other communications relating to the Tender Offer or any Subsequent Tender Offer, (c) any Party from making any factual statement that is required in any compelled testimony or production of information, either by legal process, by subpoena or as part of a response to a request for
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information from any governmental authority with jurisdiction over such Party or as otherwise legally required, (d) any Party from making any factual statement in the pending litigation captioned Eaton Vance Senior Income Trust v. Saba Capital Master Fund, Ltd., No. 2084-cv-01533 (Mass. Sup. Ct.) (the “Massachusetts Litigation”), and (e) any Party from communicating privately with their respective investors, prospective investors and governance boards regarding the terms of this Agreement.
3.2 Following the issuance of the Press Releases, Saba shall promptly prepare and file an amendment to their applicable Schedule 13D filed with the U.S. Securities and Exchange Commission (“SEC”) for the Fund reporting the entry into this Agreement (which will not contain any statement inconsistent with the Press Releases and the Item 4 disclosure set forth therein will be in a form materially consistent with the draft previously provided to the Fund). Saba shall also file a copy of this Agreement or a summary thereof as an exhibit to the Schedule 13D amendment.
3.3 Notwithstanding anything in this Agreement to the contrary, the Parties acknowledge and agree that, prior to the payment of the proceeds of the Tender Offer referenced in Section 1.1(a), the Fund may not effect a merger, reorganization with another registered investment company for which the Adviser or its affiliates (or with any other funds that are managed or advised by a successor adviser) serves as investment adviser (whether or not the Fund is the surviving company) nor issue additional shares. The Parties acknowledge and agree that the Fund may merge or reorganize with another registered investment company for which the Adviser or their affiliates (or with any other funds that are managed or advised by a successor adviser) serves as investment adviser (whether or not the Fund is the surviving company) at any time after the payment of the Tender Offer proceeds. The Fund will ensure that any such merger or reorganization effected with the Fund will be effected in a manner that binds the surviving company to all provisions of this Agreement.
Section 4. Termination
4.1 Notwithstanding anything herein to the contrary, if the Fund fails to complete the Tender Offer referenced in Section 1.1(a) and distribute the proceeds in cash to the participating shareholders within fifteen (15) business days after the completion of the Tender Offer, if the Fund fails to complete any Subsequent Tender Offer that it is obligated to undertake pursuant Section 1.1(f) and distribute the proceeds in cash to participating shareholders by December 31 of the calendar year in which the Subsequent Tender Offer is triggered pursuant to Section 1.1(f), or if the Adviser fails to make the payment pursuant to Section 2.6, this Agreement shall no longer be binding on Saba, the Saba Entities or the Affiliates, and Saba reserves all rights to seek appropriate relief.
4.2 Otherwise, this Agreement shall remain in full force and effect until the earlier of:
(a) if the Fund is required to undertake a Subsequent Tender Offer in calendar year 2024 pursuant to Section 1.1(f), the date the proceeds of such Subsequent Tender Offer are paid to shareholders or, if no Subsequent Tender Offer is triggered in 2024, December 31, 2024;
(b) such other date as may be established by mutual written agreement of the Fund, the Adviser and Saba;
(c) if the Change of Control Approval is abandoned by the Fund Board or is not obtained prior to the expiration of the term of the Fund’s Interim Investment Advisory Agreement dated March 1, 2021, the date of such abandonment or term expiration;
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(d) upon ten (10) business days’ prior written notice by either party to this Agreement (the Non-Breaching Party”) to the other party (the “Breaching Party”) following any such material breach of this Agreement by the other Breaching Party if such breach has not been cured within such notice period, provided that the Non-Breaching Party is not in material breach of this Agreement at the time such notice is given.
4.3 Survival. This Section 4.3 and Section 5 will survive the termination of this Agreement. No termination pursuant to Section 4.1 or Section 4.2(d) relieves any Party from liability for any breach of this Agreement prior to such termination.
Section 5. Miscellaneous
5.1 Specific Performance. Each Party hereto hereby acknowledges and agrees that irreparable harm will occur in the event any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the Parties will be entitled to seek specific performance hereunder, including, without limitation, an injunction or injunctions to prevent and enjoin breaches of the provisions of this Agreement and to enforce specifically the terms and provisions hereof in any state or federal court in The Commonwealth of Massachusetts, in addition to any other remedy to which they may be entitled at law or in equity. Any requirements for the securing or posting of any bond with respect to any such remedy are hereby waived. All rights and remedies under this Agreement are cumulative, not exclusive, and will be in addition to all rights and remedies available to any Party at law or in equity.
5.2 Jurisdiction; Venue; Waiver of Jury Trial. The Parties hereto hereby irrevocably and unconditionally consent to and submit to the jurisdiction of the state or federal courts in The Commonwealth of Massachusetts for any actions, suits or proceedings arising out of or relating to this Agreement or the transactions contemplated hereby. The Parties irrevocably and unconditionally waive any objection to the laying of venue of any action, suit or proceeding arising out of this Agreement, or the transactions contemplated hereby, in the state or federal courts in The Commonwealth of Massachusetts, and hereby further irrevocably and unconditionally waive and agree not to plead or claim in any such court that any such action, suit or proceeding brought in any such court has been brought in an inconvenient forum. Each of the Parties waives all right to trial by jury in any action, proceeding or counterclaim (whether based upon contract, tort or otherwise) in any way arising out of or relating to this Agreement.
5.3 Entire Agreement. This Agreement contains the entire understanding of the Parties with respect to the subject matter hereof and may be amended only by an agreement in writing executed by the Parties hereto. This Agreement supersedes all previous negotiations, representations and discussions by the Parties hereto concerning the subject matter hereof, and integrates the whole of all of their agreements and understanding concerning same. No prior oral representations or undertakings concerning the subject matter hereof will operate to amend, supersede, or replace any of the terms or conditions set forth in this Agreement, nor will they be relied upon.
5.4 Section Headings. Descriptive headings are for convenience only and will not control or affect the meaning or construction of any provision of this Agreement.
5.5 Notice. All notices, consents, requests, instructions, approvals and other communications provided for herein and all legal process in regard hereto will be validly given, made or served, if in writing and sent by email, with a copy by personal delivery, certified mail, return receipt requested, or by overnight courier service to:
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If to the Adviser, to:
Eaton Vance Management
Two International Place, Boston, MA 02110
Attention: Maureen A. Gemma, Vice President
With a copy to Rick Froio, Chief Compliance Officer
If to Saba, to:
Saba Capital Management, L.P.
405 Lexington Avenue, 58th Floor
New York, NY 10174
Attention: Michael D’Angelo
Email: Michael.D’Angelo@sabacapital.com
5.6 Severability. Any provision of this Agreement that is invalid or unenforceable in any jurisdiction will, as to such jurisdiction, be ineffective to the extent of such invalidity or unenforceability without rendering invalid or unenforceable the remaining provisions of this Agreement or affecting the validity or enforceability of any provisions of this Agreement in any other jurisdiction. In addition, the Parties agree to use their reasonable commercial efforts to agree upon and substitute a valid and enforceable term, provision, covenant or restriction for any such term, provision, covenant or restriction that is held invalid, void or unenforceable by a court of competent jurisdiction.
5.7 Governing Law. This Agreement will be governed by and construed and enforced in accordance with the laws of The Commonwealth of Massachusetts, without regard to the conflict of law principles thereof.
5.8 Binding Effect; No Assignment. This Agreement will be binding upon and inure to the benefit of and be enforceable by the successors and assigns of the Parties hereto. Nothing in this Agreement, expressed or implied, is intended to confer on any person other than the Parties hereto and those categories of persons specifically enumerated herein, or their respective successors and assigns any rights, remedies, obligations or liabilities under or by reason of this Agreement. No Party to this Agreement may, directly or indirectly, assign its rights or delegate its obligations hereunder (whether voluntarily, involuntarily, or by operation of law) without the prior written consent of the other Parties. Any such attempted assignment will be null and void.
5.9 Amendments; Waivers. No provision of this Agreement may be amended other than by an instrument in writing signed by the Parties hereto, and no provision hereof may be waived other than by an instrument in writing signed by the Party against whom enforcement is sought.
5.10 Receipt of Adequate Information; No Reliance; Representation by Counsel. Each party acknowledges that it has received adequate information to enter into this Agreement, that is has not relied on any promise, representation or warranty, express or implied not contained in this Agreement and that it has been represented by counsel in connection with this Agreement. Accordingly, any rule of law or any legal decision that would provide any party with a defense to the enforcement of the terms of this Agreement against such party by reason of the foregoing shall have no application and is expressly waived. The provisions of the Agreement shall be interpreted in a reasonable manner to effect the intent of the parties.
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5.11 Counterparts; Electronic Execution. This Agreement may be executed in counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument. Delivery of an executed signature page of this Agreement by email or other electronic means shall be effective as delivery of a manually executed counterparty hereof.
5.12 Expenses. Except as set forth in Section 2.6, all attorneys’ fees, costs and expenses incurred in connection with this Agreement and all matters related hereto will be paid by the party incurring such fees, costs or expenses.
[Signature Pages Follow]
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In Witness Whereof, the Parties hereto have executed this Agreement as of the date first above written.
| Eaton Vance Management | |
| By: | /s/ Maureen A. Gemma |
| Name: | Maureen A. Gemma |
| Title: | Vice President |
| Saba Capital Management, L.P. | |
| By: | /s/ Michael D’Angelo |
| Name: | Michael D’Angelo |
| 11 |
Exhibit A – Form of Investment Advisory Agreement
EATON VANCE SENIOR INCOME TRUST
INVESTMENT ADVISORY AGREEMENT
AGREEMENT made as of this [xx] day of [MONTH], [YEAR], between Eaton Vance Senior Income Trust, a Massachusetts business trust (the “Trust”), and Eaton Vance Management, a Massachusetts business trust (the “Adviser”).
1. Duties of the Adviser. The Trust hereby employs the Adviser to act as investment adviser for and to manage the investment and reinvestment of the assets of the Trust and to administer its investment affairs, subject to the supervision of the Trustees of the Trust, for the period and on the terms set forth in this Agreement.
(a) The Adviser hereby accepts such employment, and undertakes to afford to the Trust the advice and assistance of the Adviser’s organization in the choice of investments and in the purchase and sale of securities for the Trust and to furnish for the use of the Trust office space and all necessary office facilities, equipment and personnel for servicing the investments of the Trust and for administering its investment affairs and to pay the salaries and fees of all officers and Trustees of the Trust who are members of the Adviser’s organization and all personnel of the Adviser performing services relating to research and investment activities. The Adviser shall for all purposes herein be deemed to be an independent contractor and shall, except as otherwise expressly provided or authorized, have no authority to act for or represent the Trust in any way or otherwise be deemed an agent of the Trust.
(b) The Adviser shall provide the Trust with such investment management and supervision as the Trust may from time to time consider necessary for the proper supervision of the Trust’s investments. As investment adviser to the Trust, the Adviser shall furnish continuously an investment program and shall determine from time to time what securities and other investments shall be acquired, disposed of or exchanged and what portion of the Trust’s assets shall be held uninvested, subject always to the applicable restrictions of the Declaration of Trust, By-Laws and registration statement of the Trust under the Investment Company Act of 1940, as amended (the “1940 Act”). The Adviser is authorized, in its discretion and without prior consultation with the Trust, to buy, sell, and otherwise trade in any and all types of securities, commodities, derivatives and investment instruments on behalf of the Trust. Should the Trustees of the Trust at any time, however, make any specific determination as to investment policy for the Trust and notify the Adviser thereof in writing, the Adviser shall be bound by such determination for the period, if any, specified in such notice or until similarly notified that such determination has been revoked. The Adviser shall take, on behalf of the Trust, all actions that it deems necessary or desirable to implement the investment policies of the Trust.
(c) The Adviser shall place all orders for the purchase or sale of portfolio investments for the account of the Trust either directly with the issuer or with brokers, dealers, futures commission merchants, or other market participants selected by the Adviser, and, to that end, the Adviser is authorized, as the agent of the Trust, to give instructions to the custodian of the Trust as to deliveries of investments and payments of cash for the account of the Trust. In connection with the selection of such brokers, dealers, futures commission merchants, or other market participants and the placing of such orders, the Adviser shall use its best efforts to seek to execute security transactions at prices that are advantageous to the Trust and (when a disclosed commission is
| A-1 |
being charged) at commission rates that are reasonable in relation to the benefits received. Subject to the policies and procedures adopted by the Board of Trustees of the Trust, in selecting brokers or dealers qualified to execute a particular transaction, brokers or dealers may be selected who also provide brokerage and research services (as those terms are defined in Section 28(e) of the Securities Exchange Act of 1934) to the Adviser and the Adviser is expressly authorized to cause the Trust to pay any broker or dealer who provides such brokerage and research services a commission for executing a security transaction which is in excess of the amount of commission another broker or dealer would have charged for effecting that transaction if the Adviser determines in good faith that such amount of commission is reasonable in relation to the value of the brokerage and research services provided by such broker or dealer, viewed in terms of either that particular transaction or the overall responsibilities which the Adviser and its affiliates have with respect to the Trust and to other accounts over which they exercise investment discretion.
(d) Notwithstanding the foregoing, the Adviser shall not be deemed to have assumed any duties with respect to, and shall not be responsible for, the distribution of shares of the Trust, nor shall the Adviser be deemed to have assumed or have any responsibility with respect to functions specifically assumed by any transfer agent, administration, custodian or shareholder servicing agent of the Trust.
2. Compensation of the Adviser. For the services, payments and facilities to be furnished hereunder by the Adviser, the Adviser shall be entitled to receive from the Trust the compensation described on Appendix A hereto.
3. Allocation of Charges and Expenses. The Adviser shall pay the entire salaries and fees of all of the Trust’s Trustees and officers employed by the Adviser and who devote part or all of their time to the affairs of the Adviser, and the salaries and fees of such persons shall not be deemed to be expenses incurred by the Trust for purposes of this Section 3. Except as provided in the foregoing sentence, it is understood that the Trust will pay all expenses other than those expressly stated to be payable by the Adviser hereunder, which expenses payable by the Trust shall include, without implied limitation (i) expenses of maintaining the Trust and continuing its existence; (ii) registration of the Trust under the 1940 Act; (iii) commissions, spreads, fees and other expenses connected with the acquisition, holding and disposition of securities and other investments; (iv) auditing, accounting and legal expenses; (v) taxes and interest; (vi) governmental fees, (vii) expenses of listing shares of the Trust with a stock exchange, and expenses of issue, sale, repurchase and redemption (if any) of shares of the Trust, including expenses of conducting tender offers for the purpose of repurchasing Trust shares; (viii) fees and expenses of registering, qualifying, and maintaining the Trust and its shares under applicable federal and state securities laws and of preparing and filing registration statements, other offering statements or memoranda, and other reports, forms, and documents required to be filed by the Trust with the Securities and Exchange Commission (the “SEC”) and any other regulatory body, and for printing and distributing the same to shareholders; (ix) expenses of reports and notices to shareholders and of meetings of shareholders and proxy solicitations therefor; (x) expenses of reports to governmental officers and commissions; (xi) insurance expenses; (xii) association membership dues; (xiii) fees, expenses and disbursements of custodians and subcustodians for all services to the Trust (including without limitation safekeeping of funds, securities and other investments, keeping of books, accounts and records, and determination of net asset values); (xiv) fees, expenses and disbursements of transfer agents, dividend disbursing agents, shareholder servicing agents and registrars for all services to the Trust; (xv) expenses for servicing shareholder accounts; (xvi) any direct charges to the Trust or shareholders approved by the Trustees of the Trust; (xvii) compensation and expenses of Trustees of the Trust who are not members of the Adviser’s organization; (xviii) any pricing or valuation services employed by the Trust to value its investments including primary and comparative valuation services; (xix) any
| A-2 |
investment advisory, sub-investment advisory, or similar management fee payable by the Trust; (xx) all expenses incurred in connection with the Trust’s use of a line of credit, other borrowings or leverage; and (xxi) such non-recurring items as may arise, including expenses incurred in connection with litigation, proceedings and claims and the obligation of the Trust to indemnify its Trustees, officers and shareholders with respect thereto.
4. Other Interests. It is understood that Trustees and officers of the Trust and shareholders of the Trust are or may be or become interested in the Adviser as trustees, officers, employees, shareholders or otherwise and that trustees, officers, employees and shareholders of the Adviser are or may be or become similarly interested in the Trust, and that the Adviser may be or become interested in the Trust as a shareholder or otherwise. It is also understood that trustees, officers, employees and shareholders of the Adviser may be or become interested (as directors, trustees, officers, employees, shareholders or otherwise) in other companies or entities (including, without limitation, other investment companies) that the Adviser may organize, sponsor or acquire, or with which it may merge or consolidate, and which may include the words “Eaton Vance” or any combination thereof as part of their name, and that the Adviser or its subsidiaries or affiliates may enter into advisory or management agreements or other contracts or relationships with such other companies or entities.
5. Limitation of Liability of the Adviser. In the absence of willful misfeasance, bad faith, gross negligence or reckless disregard of obligations or duties hereunder on the part of the Adviser, the Adviser shall not be subject to liability to the Trust or to any shareholder of the Trust for any act or omission in the course of, or connected with, rendering services hereunder or for any losses that may be sustained in the acquisition, holding or disposition of any security or other investment.
A copy of the Declaration of Trust of the Adviser is on file with the Secretary of The Commonwealth of Massachusetts, and notice is hereby given that this Agreement is executed on behalf of the Adviser by an officer in his or her capacity as an officer and not individually. The Trust expressly acknowledges the provisions in the Declaration of Trust of the Adviser limiting the personal liability of the trustees, officers, and shareholders of the Adviser, and the Trust hereby agrees that it shall have recourse to the Adviser for payment of claims or obligations as between the Adviser and the Trust arising out of this Agreement and shall not seek satisfaction from the trustees, officers, or shareholders of the Adviser.
6. Sub-Investment Advisers. The Adviser may employ one or more sub-investment advisers from time to time to perform any of the Adviser’s duties under this Agreement, upon such terms and conditions as may be agreed upon between the Adviser and such sub-investment adviser and approved by the Trustees of the Trust, all as permitted by the 1940 Act. The performance of each such sub-investment adviser of its obligation under any such agreement shall be supervised by the Adviser. Further, the Adviser may, with the approval of the Trustees of the Trust and without the vote of any shareholders of the Trust, terminate any agreement with any sub-investment adviser and/or enter into an agreement with one or more other sub-investment advisers, all as permitted by the 1940 Act and the rules thereunder. In the event a sub-investment adviser is employed, the Adviser retains the authority to immediately assume responsibility for any functions delegated to a sub-investment adviser, subject to approval by the Board and notice to the sub-investment adviser.
| A-3 |
7. Duration and Termination of this Agreement. This Agreement shall become effective upon the date of its execution, and, unless terminated as herein provided, shall remain in full force and effect through and including the second anniversary of the execution of this Agreement and shall continue in full force and effect indefinitely thereafter, but only so long as such continuance after such second anniversary is specifically approved at least annually: (i) by the Board of Trustees of the Trust or by vote of a majority of the outstanding voting securities of the Trust and (ii) by the vote of a majority of those Trustees of the Trust who are not interested persons of the Adviser or the Trust cast in person at a meeting called for the purpose of voting on such approval.
Either party hereto may, at any time on sixty (60) days’ prior written notice to the other, terminate this Agreement without the payment of any penalty, by action of Trustees of the Trust or the trustees of the Adviser, as the case may be, and the Trust may, at any time upon such written notice to the Adviser, terminate this Agreement by vote of a majority of the outstanding voting securities of the Trust. This Agreement shall terminate automatically in the event of its assignment.
8. Amendments of the Agreement. This Agreement may be amended by a writing signed by both parties hereto, provided that no amendment to this Agreement shall be effective until approved in a manner consistent with the requirements of the 1940 Act.
9. Limitation of Liability of Trustees and Officers of the Trust. A copy of the Declaration of Trust of the Trust is on file with the Secretary of The Commonwealth of Massachusetts, and notice is hereby given that this Agreement is executed on behalf of the Trust by an officer in his or her capacity as an officer and not individually. The Adviser expressly acknowledges the provisions in the Declaration of Trust of the Trust limiting the personal liability of the Trustees, officers, and shareholders of the Trust, and the Adviser hereby agrees that it shall have recourse to the Trust for payment of claims or obligations as between the Trust and the Adviser arising out of this Agreement and shall not seek satisfaction from the Trustees, officers, or shareholders of the Trust or any Trustee, officer, or shareholder of the Trust.
10. Use of the Name “Eaton Vance”. The Adviser hereby consents to the use by the Trust of the name “Eaton Vance” as part of the Trust’s name; provided, however, that such consent shall be conditioned upon the employment of the Adviser or one of its affiliates as the investment adviser of the Trust. The name “Eaton Vance” or any variation thereof may be used from time to time in other connections and for other purposes by the Adviser and its affiliates and other investment companies that have obtained consent to the use of the name “Eaton Vance”. The Adviser shall have the right to require the Trust to cease using the name “Eaton Vance” as part of the Trust’s name if the Trust ceases, for any reason, to employ the Adviser or one of its affiliates as the Trust’s investment adviser. Future names adopted by the Trust for itself, insofar as such names include identifying words requiring the consent of the Adviser, shall be the property of the Adviser and shall be subject to the same terms and conditions.
11. No Third Party Beneficiaries. Nothing in this Agreement, express or implied, is intended to or shall confer upon any person not a party hereto any right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.
| A-4 |
12. Non-Exclusive Services. The services of the Adviser to the Trust are not to be deemed to be exclusive, the Adviser being free to render services to others and engage in other business activities. It is understood that the Adviser and its affiliates perform investment services, including rendering investment advice, to varied clients. It is understood that the Adviser or any of its affiliates may give advice or take action for other accounts that may differ from, conflict with or be adverse to advice given or taken for the Trust. It is understood that certain securities or instruments may be held in some accounts but not in others, or the accounts may have different levels of holdings in certain securities or instruments and the accounts may remit different levels of fees to the Adviser. In addition, it is understood that the Adviser or any of its affiliates may give advice or take action with respect to the investments of the Trust that may not be given or taken with respect to one or more accounts with similar investment programs, objectives, and strategies. The Trust acknowledges that the Adviser, its affiliates and their respective officers, directors, and/or employees may from time to time have positions in or transact in securities and other investments recommended to clients, including the Trust. Such transactions may differ from or be inconsistent with the advice given, or the timing or nature of the Adviser’s action or actions with respect to the Trust. The Adviser may aggregate the Trust’s orders with orders of its proprietary accounts and/or orders of other clients.
13. Certain Definitions. The terms “assignment” and “interested persons” when used herein shall have the respective meanings specified in the 1940 Act as now in effect or as hereafter amended subject, however, to such exemptions as may be granted by any rule, regulation or order by the SEC. The term “vote of a majority of the outstanding voting securities” shall mean the vote, at a meeting of shareholders, of the lesser of (a) 67 per centum or more of the shares of the Trust present or represented by proxy at the meeting if the shareholders of more than 50 per centum of the outstanding shares of the Trust are present or represented by proxy at the meeting, or (b) more than 50 per centum of the outstanding shares of the Trust. In addition, where the effect of a requirement of the 1940 Act reflected in any provision of this Agreement is modified or interpreted by any applicable order or orders of the SEC, any rules or regulations adopted by, or interpretative releases of, the SEC, or any applicable guidance issued by the staff of the SEC, such provision will be deemed to incorporate the effect of such order, rule, regulation, interpretative release, or guidance.
14. Miscellaneous.
(a) If any term or provision of this Agreement or the application thereof to any person or circumstance is held to be invalid or unenforceable to any extent, the remainder of this Agreement or the application of such provision to other persons or circumstances shall not be affected thereby and shall be enforced to the fullest extent permitted by law.
(b) This Agreement shall be governed by and interpreted in accordance with the laws of The Commonwealth of Massachusetts.
(c) This Agreement may be executed by the parties hereto in any number of counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument.
[Signature page follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the day and year first above written.
| EATON VANCE SENIOR INCOME TRUST |
| By: |
| Deidre E. Walsh |
| Vice President and not individually |
| EATON VANCE MANAGEMENT |
| By: |
| Maureen A. Gemma |
| Vice President and not individually |
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APPENDIX A
For the services, payments and facilities furnished by the Adviser under this Agreement, the Adviser is entitled to receive from the Trust compensation as set forth below:
A fee in an amount equal to 0.74% annually of average weekly gross assets of the Trust throughout each month, provided that such amount shall be reduced to the following amount as of the stated date: 5/1/2021: 0.73%, 5/1/2022: 0.72%, 5/1/2023: 0.71%, 5/1/2024: 0.70%, 5/1/2025: 0.69% and 5/1/2026: 0.55%. Gross assets shall be calculated by deducting accrued liabilities of the Trust except the principal amount of any indebtedness for money borrowed, including debt securities issued by the Trust. Accrued liabilities are expenses incurred in the normal course of operations.
In case of initiation or termination of the Agreement during any month with respect to the Trust, the fee for that month shall be reduced proportionately on the basis of the number of calendar days during which the Agreement is in effect.
Such compensation shall be paid monthly in arrears. The Adviser may, from time to time, waive all or a part of the above compensation.
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EXHIBIT B
FUND PRESS RELEASE
[Eaton Vance Logo]
Investor Contact: (800) 262-1122
FOR IMMEDIATE RELEASE
Eaton Vance Senior Income Trust Announces Conditional Tender Offers and Special Meeting of Shareholders
BOSTON, MA, [ ], 2021 — The Board of Eaton Vance Senior Income Trust (NYSE: EVF) (the “Fund”) has authorized a conditional cash tender offer for up to 60% of the Fund’s outstanding common shares at a price per share equal to 99% of the Fund’s net asset value per share (“NAV”) as of the close of regular trading on the New York Stock Exchange (“NYSE”) on the date the tender offer expires (the “Initial Tender Offer”). The Initial Tender Offer is conditioned on Fund shareholders’ approving the Fund’s new investment advisory agreement with Eaton Vance Management (“EVM”), the Fund’s investment adviser (the “New Agreement”). If the New Agreement is approved, the Fund would commence the Initial Tender Offer within 30 days following shareholder approval of the New Agreement, and the Fund would purchase common shares tendered and accepted in the Initial Tender Offer within 15 business days after the Initial Tender Offer expires. If the New Agreement is approved by shareholders, additional terms and conditions of the Initial Tender Offer would be set forth in the associated Fund offering materials and additional press releases, as applicable.
In addition to the Initial Tender Offer, the Fund is announcing today that it will conduct cash tender offers by the end of the fourth quarter of each of 2022, 2023 and 2024 (each, a “Conditional Tender Offer” and, collectively with the Initial Tender Offer, the “Tender Offers”) for up to 10% of the Fund’s then-outstanding common shares if, from January to August of the relevant year, the Fund’s shares trade at an average discount to NAV of more than 10% (based upon the Fund’s volume-weighted average market price and NAV on business days during the period). If triggered, common shares tendered and accepted in a Conditional Tender Offer would be repurchased at a price per share equal to 98% of the Fund’s NAV as of the close of regular trading on the NYSE on the date such Conditional Tender Offer expires. If a Conditional Tender Offer is triggered, the Fund will issue a press release providing notification and additional information about such Conditional Tender Offer.
The Fund also announced today that its Board has set a record date of May 14, 2021 (the “Record Date”) for determining those shareholders entitled to notice of, and the right to vote at, a special meeting of shareholders to be held on June 24, 2021 and any adjournment or postponement thereof (the “Special Meeting”). At the Special Meeting, shareholders will be asked to approve the New Agreement.
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Eaton Vance Corp. was acquired by Morgan Stanley on March 1, 2021. Its Eaton Vance Management, Parametric, Atlanta Capital and Calvert investment affiliates are now part of Morgan Stanley Investment Management, the asset management division of Morgan Stanley.
About the Fund
Except pursuant to a tender offer, common shares of the Fund are available for purchase or sale only through secondary market trading at their current market price. Shares of closed-end funds often trade at a discount from their NAV. The market price of Fund shares may vary from NAV based on factors affecting the supply and demand for shares, such as Fund distribution rates relative to similar investments, investors’ expectations for future distribution changes, the clarity of the Fund’s investment strategy and future return expectations, and investors’ confidence in the underlying markets in which the Fund invests. Fund shares are subject to investment risk, including possible loss of principal invested. Shares of the Fund are not FDIC-insured and are not deposits or other obligations of, or guaranteed by, any bank. The Fund is not a complete investment program and you may lose money investing therein. An investment in the Fund may not be appropriate for all investors. Before investing, prospective investors should consider carefully a Fund’s investment objective, strategies, risks, charges and expenses.
This announcement is not a recommendation, an offer to purchase or a solicitation of an offer to sell shares of the Fund. The Fund has not commenced the Tender Offers described in this release. Each Tender Offer will be made only if the condition described above is satisfied, and only by an offer to purchase, a related letter of transmittal and other documents filed with the SEC as exhibits to a tender offer statement on Schedule TO, with all such documents available on the SEC’s website at www.sec.gov. For each Tender Offer, the Fund will also make available to shareholders without charge the offer to purchase and the letter of transmittal.
Shareholders should read these documents carefully, as they would contain important information about the Tender Offer.
In connection with the Special Meeting, the Fund intends to file a definitive proxy statement with the SEC. Shareholders are advised to read the Fund’s Special Meeting proxy statement when it is available because it will contain important information. When filed with the SEC, the proxy statement and other documents filed by the Fund will be available free of charge on the SEC website, www.sec.gov. Copies of the Special Meeting proxy statement will also be mailed to each Fund shareholder of record as of the Record Date.
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This press release is for informational purposes only and is not intended to, and does not, constitute an offer to purchase or sell shares of the Fund. Additional information about the Fund, including performance and portfolio characteristic information, is available at eatonvance.com.
Statements in this press release that are not historical facts may be forward-looking statements, as defined by the U.S. securities laws. You should exercise caution in interpreting and relying on forward-looking statements because they are subject to uncertainties and other factors that may be beyond the Fund’s control and could cause actual results to differ materially from those set forth in the forward-looking statements.
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EXHIBIT C
Saba Press Release
SABA CAPITAL REACHES AGREEMENTS WITH THREE EATON VANCE CLOSED-END FUNDS
Eaton Vance Senior Income Trust, Eaton Vance Floating-Rate Income Trust, and Eaton Vance Senior Floating-Rate Trust to Commence Tender Offers
NEW YORK, April [XX], 2021 – Saba Capital Management, L.P. and certain associated parties (collectively “Saba”) today announced that it has reached agreement with Eaton Vance Management with respect to each of Eaton Vance Senior Income Trust (NYSE: EVF), Eaton Vance Floating-Rate Income Trust (NYSE: EFT), and Eaton Vance Senior Floating-Rate Trust (NYSE: EFR) (the “Funds”).
Under the terms of the agreements, Eaton Vance Senior Income Trust, Eaton Vance Floating-Rate Income Trust, and Eaton Vance Senior Floating-Rate Trust will commence cash tender offers for up to 60%, 50%, and 50%, respectively, of the Funds’ outstanding shares of common stock at a price per share equal to 99% of the Funds’ respective net asset values (“NAV”) per share. The Funds will repurchase shares tendered and accepted in the tender offers in exchange for cash.
The Funds also agreed to three conditional year-end tender offers for up to 10% of their then outstanding common shares, at 98% of NAV in the event the average discount to the respective Fund’s NAV from January 1 through August 31 of each of 2022, 2023 and 2024 exceeds 10% based on the respective fund’s volume-weighted average market price and NAV on the business days during such period.
In addition, Saba has agreed to certain standstill covenants.
“We are pleased to have reached these agreements that benefit all shareholders,” said Pierre Weinstein, Partner and Portfolio Manager of Saba. “By providing all shareholders of the Funds with the opportunity to tender their shares at a price near the Funds’ NAVs, tendering shareholders will receive immediate liquidity at an attractive price, and non-tendering shareholders will benefit from a narrowing in the Funds’ discounts to NAV as well as the accretive nature of the tender being conducted at 99% of NAV.”
About Saba Capital
Saba Capital Management, L.P. is a registered investment adviser founded in 2009. Saba is a spin-out of a proprietary investing group founded by Boaz Weinstein at Deutsche Bank in 1998. Saba manages $3.2 billion across four core strategies: Credit Relative Value, Tail Hedge, SPACs and Closed-End Funds. Saba’s investors are predominantly institutions and include public and corporate pension plans, endowments and foundations, family offices, banks and insurers, bank private wealth platforms, fund of funds and certain high net worth individuals.
Contacts
Investors Leah Jordan
Investor Relations Leah.Jordan@sabacapital.com
Media Gasthalter & Co.
Jonathan Gasthalter/Amanda Klein
212-257-4170
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