<DOCUMENT>
<TYPE>EX-99.H1
<SEQUENCE>3
<FILENAME>c82676a1exv99wh1.txt
<DESCRIPTION>FORM OF UNDERWRITING AGREEMENT
<TEXT>
<PAGE>
                                                                     EXHIBIT h.1



                    AUCTION RATE CUMULATIVE PREFERRED SHARES

                       CALAMOS STRATEGIC TOTAL RETURN FUND

                                SHARES, SERIES M
                                SHARES, SERIES T
                                SHARES, SERIES W
                                SHARES, SERIES TH
                                SHARES, SERIES F
                                SHARES, SERIES A
                                SHARES, SERIES B
                    LIQUIDATION PREFERENCE $25,000 PER SHARE
                         FORM OF UNDERWRITING AGREEMENT


                                                                      May , 2004

Citigroup Global Markets Inc.
As Representative of the several Underwriters

c/o Citigroup Global Markets Inc.
388 Greenwich Street
New York, New York  10013


Ladies and Gentlemen:

         The undersigned, Calamos Strategic Total Return Fund, a Delaware
statutory trust (the "Fund") and Calamos Asset Management, Inc., an Illinois
corporation (the "Adviser"), address you as underwriters and as the
representative (the "Representative") of each of the several underwriters named
on Schedule I hereto (the "Underwriters"). The Fund proposes to sell to the
Underwriters an aggregate of (i)   shares of its Series M Preferred Shares, (ii)
    shares of its Series T Preferred Shares, (iii)    shares of its Series W
Preferred Shares, (iv)    shares of its Series TH Preferred Shares, (v)
     shares of its Series F Preferred Shares, (vi)    shares of its Series A
Preferred Shares and (vii) and    shares of its Series B Preferred Shares
(collectively, the "Preferred Shares"), each no par value per share, with a
liquidation preference of $25,000 per share to the Underwriters. The
Preferred Shares will be authorized by, and subject to the terms and
conditions of, the Statement of Preferences of Preferred Shares adopted in
connection with the issuance of the Preferred Shares and as amended through
the date hereof (the "Statement") and the Agreement and Declaration of Trust
dated December 31, 2003, as it may be amended (the "Declaration of Trust")
in the forms filed as exhibits to the Registration Statement referred to in
Section 1 of this Agreement. Unless otherwise stated, the term "you" as used
herein means Citigroup Global Markets Inc. individually on its own behalf and
on behalf of the other Underwriters. Certain terms used herein are defined in
Section 18 hereof.


<PAGE>
                                                                               2

                  The Fund and the Adviser wish to confirm as follows their
agreements with you and the other several Underwriters on whose behalf you are
acting in connection with the several purchases of the Preferred Shares by the
Underwriters.

                  The Fund has entered into an Investment Management Agreement
with the Adviser dated as of March 12, 2004, a Custody Agreement with The Bank
of New York dated as of March 12, 2004, a Stock Transfer Agency Agreement with
The Bank of New York dated as of March 12, 2004, a Financial Accounting Services
Agreement with the Adviser dated as of March 30, 2004, a Master Services
Agreement with State Street Bank and Trust Company dated as of March 15, 2004
and an Auction Agency Agreement (including the form of Broker-Dealer Agreement)
with the Bank of New York dated May , 2004, and such agreements are herein
referred to as the "Management Agreement," the "Custodian Agreement, " the
"Transfer Agency Agreement," the "Accounting Agreement," the "Administration
Agreement" and the "Auction Agency Agreement" respectively. Collectively, the
Management Agreement, the Custodian Agreement, the Transfer Agency Agreement,
the Accounting Agreement, the Administration Agreement and the Auction Agent
Agreement are herein referred to as the "Fund Agreements." In addition, the Fund
has adopted a dividend reinvestment plan (the "Dividend Reinvestment Plan")
pursuant to which holders of common shares of beneficial interest, no par value
per share (the "Common Shares"), shall have their dividends automatically
reinvested in additional Common Shares of the Fund unless they elect to receive
such dividends in cash. This Underwriting Agreement is herein referred to as the
"Agreement".

                  1. Representations and Warranties of the Fund and the Adviser.
The Fund and the Adviser, jointly and severally, represent and warrant to, and
agree with, each Underwriter as set forth below in this Section 1.

                  (a) The Fund has prepared and filed with the Commission a
         registration statement (file numbers 333-113439 and 811-21484) on Form
         N-2, including a related preliminary prospectus (including the
         statement of additional information incorporated by reference therein),
         for registration under the Act and the 1940 Act of the offering and
         sale of the Preferred Shares. The Fund may have filed one or more
         amendments thereto, including a related preliminary prospectus
         (including the statement of additional information incorporated by
         reference therein), each of which has previously been furnished to you.
         The Fund will next file with the Commission one of the following:
         either (1) prior to the Effective Date of such registration statement,
         a further amendment to such registration statement (including the form
         of final prospectus (including the statement of additional information
         incorporated by reference therein)) or (2) after the Effective Date of
         such registration statement, a final prospectus (including the
         statement of additional information incorporated by reference therein)
         in accordance with Rules 430A and 497. In the case of clause (2), the
         Fund has included in such registration statement, as amended at the
         Effective Date, all information (other than Rule 430A Information)
         required by the Act and the 1940 Act and the Rules and Regulations to
         be included in such registration statement and the Prospectus. As
         filed, such amendment and form of final prospectus (including the
         statement of additional information incorporated by reference therein),
         or such final prospectus (including the statement of additional
         information incorporated by reference therein), shall contain all Rule
         430A Information, together with all other such required information,
         and, except to the extent the


<PAGE>
                                                                               3

         Representative shall agree in writing to a modification, shall be in
         all substantive respects in the form furnished to you prior to the
         Execution Time or, to the extent not completed at the Execution Time,
         shall contain only such specific additional information and other
         changes (beyond that contained in the latest Preliminary Prospectus) as
         the Fund has advised you, prior to the Execution Time, will be included
         or made therein.

                  (b) Each Preliminary Prospectus complied when filed with the
         Commission in all material respects with the provisions of the Act, the
         1940 Act and the Rules and Regulations, except that this representation
         and warranty does not apply to statements in or omissions from the
         registration statement or the Preliminary Prospectus made in reliance
         upon and in conformity with information relating to any Underwriter
         furnished to the Fund in writing by or on behalf of any Underwriter
         through you expressly for use therein. The Commission has not issued
         any order preventing or suspending the use of any Preliminary
         Prospectus.

                  (c) On the Effective Date, the Registration Statement did or
         will, and when the Prospectus (and any supplement thereto) is first
         filed (if required) in accordance with Rule 497 it will, and the 1940
         Act Notification when originally filed with the Commission and any
         amendment or supplement thereto when filed with the Commission did or
         will, comply in all material respects with the applicable requirements
         of the Act, the 1940 Act and the Rules and Regulations and the
         Registration Statement on the Effective Date did not or will not
         contain any untrue statement of a material fact or omit to state any
         material fact required to be stated therein or necessary in order to
         make the statements therein not misleading; and, on the Effective Date,
         the Prospectus, if not filed pursuant to Rule 497, and on the date of
         any filing pursuant to Rule 497, will not include any untrue statement
         of a material fact or omit to state a material fact necessary in order
         to make the statements therein, in the light of the circumstances under
         which they were made, not misleading; provided, however, that the Fund
         makes no representations or warranties as to the information contained
         in or omitted from the Registration Statement, or the Prospectus (or
         any supplement thereto) in reliance upon and in conformity with
         information furnished in writing to the Fund by or on behalf of any
         Underwriter through the Representative specifically for inclusion in
         the Registration Statement or the Prospectus (or any supplement
         thereto).

                  (d) The Fund has been duly formed and is validly existing in
         good standing as a statutory trust under the laws of the State of
         Delaware, with full power and authority to own, lease and operate its
         properties and to conduct its business as described in the Registration
         Statement and the Prospectus (and any amendment or supplement to either
         of them) and is duly registered and qualified to conduct business and
         is in good standing in each jurisdiction or place where the nature of
         its properties or the conduct of its business requires such
         registration or qualification, except where the failure so to register
         or to qualify does not have a material, adverse effect on the condition
         (financial or other), business, prospects, properties, net assets or
         results of operations of the Fund. The Fund has no subsidiaries.

                  (e) The Fund's authorized equity capitalization is as set
         forth in the Prospectus; the capital stock of the Fund conforms in all
         material respects to the description thereof


<PAGE>
                                                                               4


         contained in the Prospectus; all outstanding Common Shares have been
         duly and validly authorized and issued and are fully paid and, except
         as described in the Prospectus, nonassessable; the Preferred Shares
         have been duly and validly authorized, and, when issued and delivered
         to and paid for by the Underwriters pursuant to this Agreement, will be
         fully paid and, except as described in the Prospectus, nonassessable
         and free of any preemptive or similar rights that entitle or will
         entitle any person to acquire any Preferred Shares upon issuance
         thereof by the Fund; the certificates for the Preferred Shares are in
         valid and sufficient form; the holders of outstanding Common Shares are
         not entitled to preemptive or other rights to subscribe for the
         Preferred Shares; and, except as set forth in the Prospectus, no
         options, warrants or other rights to purchase, agreements or other
         obligations to issue, or rights to convert any obligations into or
         exchange any securities for, shares of capital stock of, or ownership
         interests in, the Fund are outstanding.

                  (f) The Fund's registration statement on Form 8-A under the
         Exchange Act has become effective.

                  (g) The Fund, subject to the Registration Statement having
         been declared effective and the filing of the Prospectus under Rule
         497, has taken all required action under the Act, the 1940 Act and the
         Rules and Regulations to make the public offering and consummate the
         sale of the Preferred Shares as contemplated by this Agreement.

                  (h) There are no agreements, contracts, indentures, leases or
         other instruments that are required to be described in the Registration
         Statement or the Prospectus, or to be filed as an exhibit thereto,
         which are not described or filed as required; and the statements in the
         Registration Statement and Prospectus, insofar as they are descriptions
         of contracts, agreements or other legal documents or refer to
         statements of law or legal conclusions, are accurate and present fairly
         the information required to be shown.

                  (i) The execution and delivery of and the performance by the
         Fund of its obligations under this Agreement and the Fund Agreements
         have been duly and validly authorized by the Fund and this Agreement
         and the Fund Agreements have been duly executed and delivered by the
         Fund and constitute the valid and legally binding agreements of the
         Fund, enforceable against the Fund in accordance with their terms,
         except as rights to indemnity and contribution hereunder may be limited
         by federal or state securities laws and subject to the qualification
         that the enforceability of the Fund's obligations hereunder and
         thereunder may be limited by bankruptcy, insolvency, reorganization,
         moratorium and other laws relating to or affecting creditors' rights
         generally and by general equitable principles.

                  (j) The Fund is duly registered under the 1940 Act as a
         closed-end, diversified management investment company and the 1940 Act
         Notification has been duly filed with the Commission. The Fund has not
         received any notice from the Commission pursuant to Section 8(e) of the
         1940 Act with respect to the 1940 Act Notification or the Registration
         Statement.

                  (k) No consent, approval, authorization, filing with or order
         of any court or governmental agency or body is required in connection
         with the transactions


<PAGE>
                                                                               5


         contemplated herein or in the Fund Agreements, except such as have been
         made or obtained under the Act, the 1940 Act and the rules and
         regulations of the National Association of Securities Dealers, Inc.
         (the "NASD"), and such as may be required under the blue sky laws of
         any jurisdiction in connection with the purchase and distribution of
         the Preferred Shares by the Underwriters in the manner contemplated
         herein and in the Prospectus.

                  (l) Neither the issuance and sale of the Preferred Shares, the
         execution, delivery or performance of this Agreement or any of the Fund
         Agreements by the Fund, nor the consummation by the Fund of the
         transactions contemplated hereby or thereby (i) conflicts or will
         conflict with or constitutes or will constitute a breach of the
         Statement, Declaration of Trust or by-laws of the Fund ("By-Laws"),
         (ii) conflicts or will conflict with or constitutes or will constitute
         a breach of or a default under, any material agreement, indenture,
         lease or other instrument to which the Fund is a party or by which it
         or any of its properties may be bound or (iii) materially violates or
         will materially violate any material statute, law, regulation or filing
         or judgment, injunction, order or decree applicable to the Fund or any
         of its properties or will result in the creation or imposition of any
         material lien, charge or encumbrance upon any property or assets of the
         Fund pursuant to the terms of any agreement or instrument to which it
         is a party or by which it may be bound or to which any of the property
         or assets of the Fund is subject.

                  (m) No holders of securities of the Fund have rights to the
         registration of such securities under the Registration Statement.

                  (n) The financial statements, together with related schedules
         and notes, included in the Prospectus and the Registration Statement
         present fairly in all material respects the financial condition and
         results of operations of the Fund as of the dates and for the periods
         indicated, comply as to form with the applicable accounting
         requirements of the Act and the 1940 Act and have been prepared in
         conformity with generally accepted accounting principles applied on a
         consistent basis throughout the periods involved (except as otherwise
         noted therein).

                  (o) No action, suit or proceeding by or before any court or
         governmental agency, authority or body or any arbitrator involving the
         Fund or its property is pending or, to the knowledge of the Fund,
         threatened that (i) could reasonably be expected to have a material
         adverse effect on the performance of this Agreement or the consummation
         of any of the transactions contemplated hereby or (ii) could reasonably
         be expected to have a material adverse effect on the condition
         (financial or otherwise), prospects, earnings, business or properties
         of the Fund, whether or not arising from transactions in the ordinary
         course of business, except as set forth in or contemplated in the
         Prospectus (exclusive of any supplement thereto).

                  (p) The Fund is not (i) in violation of its Statement,
         Declaration of Trust or By-Laws, (ii) in breach or default in any
         material respect in the performance of the terms of any material
         indenture, contract, lease, mortgage, deed of trust, note agreement,
         loan agreement or other agreement, obligation, condition, covenant or
         instrument to which it is a party or bound or to which its property is
         subject or (iii) in material violation of any
<PAGE>
                                                                               6

        material law, ordinance, administrative or governmental rule or
        regulation applicable to the Fund, including, without limitation, the
        applicable provisions of the Sarbanes-Oxley Act of 2002 (the
        "Sarbanes-Oxley Act") and the rules and regulations promulgated in
        connection therewith, or of any material decree of the Commission, the
        NASD, any state securities commission, any national securities exchange,
        any arbitrator, any court or any other governmental, regulatory,
        self-regulatory or administrative agency or any official having
        jurisdiction over the Fund.

                  (q) Since the date as of which information is given in the
         Prospectus, except as otherwise stated therein, (i) there has been no
         material, adverse change in the condition (financial or other),
         business, properties, net assets or results of operations of the Fund
         or business prospects (other than as a result of a change in the
         financial markets generally) of the Fund, whether or not arising in the
         ordinary course of business, (ii) there have been no transactions
         entered into by the Fund which are material to the Fund other than
         those in the ordinary course of its business as described in the
         Prospectus and (iii) there has been no dividend or distribution of any
         kind declared, paid or made by the Fund on any class of its Common
         Shares.

                  (r) Deloitte & Touche LLP, who have audited the Statement of
         Assets and Liabilities and the related Statement of Operations included
         in the Registration Statement and the Prospectus, are independent
         public accountants with respect to the Fund within the meaning of the
         Act, the 1940 Act and the Rules and Regulations.

                  (s) The Fund has not distributed and, prior to the later to
         occur of (i) the Closing Date (as defined below in Section 4) and (ii)
         completion of the distribution of the Preferred Shares, will not
         distribute any offering material in connection with the offering and
         sale of the Preferred Shares other than the Registration Statement, the
         Preliminary Prospectus, the Prospectus or other materials permitted by
         the Act, the 1940 Act or the Rules and Regulations.

                  (t) The Fund has filed all tax returns required to be filed
         and the Fund is not in material default in the payment of any taxes
         which were shown as payable on said returns or any assessments with
         respect thereto; and, as required by Subchapter M of the Code, the Fund
         is currently in compliance with the requirements to qualify as a
         regulated investment company under the Code.

                  (u) All advertising, sales literature or other promotional
         material (including "prospectus wrappers", "broker kits", "road show
         slides" and "road show scripts"), whether in printed or electronic
         form, authorized in writing by or prepared by the Fund or the Adviser
         for use in connection with the offering and sale of the Preferred
         Shares (collectively, "sales material") complied and comply in all
         material respects with the applicable requirements of the Act, the Act
         Rules and Regulations and the rules and interpretations of the NASD and
         if required to be filed with the NASD under the NASD's conduct rules
         were provided to Simpson Thacher & Bartlett LLP, counsel for the
         Underwriters, for filing. No sales material contained or contains an
         untrue statement of a material fact or omitted or omits to state a
         material fact necessary in order to make the


<PAGE>
                                                                               7


         statements therein, in the light of the circumstances under which they
         were made, not misleading.

                  (v) The Fund's directors and officers/errors and omissions
         insurance policy and its fidelity bond required by Rule 17g-1 of the
         1940 Act Rules and Regulations are in full force and effect; the Fund
         is in compliance with the terms of such policy and fidelity bond in all
         material respects; and there are no claims by the Fund under any such
         policy or fidelity bond as to which any insurance company is denying
         liability or defending under a reservation of rights clause; the Fund
         has not been refused any insurance coverage sought or applied for; and
         the Fund has no reason to believe that it will not be able to renew its
         existing insurance coverage as and when such coverage expires or to
         obtain similar coverage from similar insurers as may be necessary to
         continue its business at a cost that would not have a material adverse
         effect on the condition (financial or otherwise), prospects, earnings,
         business or properties of the Fund, whether or not arising from
         transactions in the ordinary course of business, except as set forth in
         or contemplated in the Prospectus (exclusive of any supplement
         thereto).

                  (w) The Fund has such licenses, permits, and authorizations of
         governmental or regulatory authorities ("permits") as are necessary to
         own its property and to conduct its business in the manner described in
         the Prospectus, except where the failure to hold any such permit does
         not have a material, adverse effect on the condition (financial or
         other), business, prospects, properties, net assets or results of
         operations of the Fund; the Fund has fulfilled and performed all its
         material obligations with respect to such permits and no event has
         occurred which allows or, after notice or lapse of time, would allow,
         revocation or termination thereof or results in any other material
         impairment of the rights of the Fund under any such permit, subject in
         each case to such qualification as may be set forth in the Prospectus;
         and, except as described in the Prospectus, none of such permits
         contains any restriction that is materially burdensome to the Fund.

                  (x) The Fund maintains and will maintain a system of internal
         accounting controls sufficient to provide reasonable assurances that
         (i) transactions are executed in accordance with management's general
         or specific authorization and with the investment objectives, policies
         and restrictions of the Fund and the applicable requirements of the
         1940 Act, the 1940 Act Rules and Regulations and the Internal Revenue
         Code of 1986, as amended (the "Code"); (ii) transactions are recorded
         as necessary to permit preparation of financial statements in
         conformity with generally accepted accounting principles, to calculate
         net asset value, to maintain accountability for assets and to maintain
         material compliance with the books and records requirements under the
         1940 Act and the 1940 Act Rules and Regulations; (iii) access to assets
         is permitted only in accordance with management's general or specific
         authorization; and (iv) the recorded accountability for assets is
         compared with existing assets at reasonable intervals and appropriate
         action is taken with respect to any differences.

                  (y) Except as stated in this Agreement and the Prospectus, the
         Fund has not taken, directly or indirectly, any action designed to or
         that would constitute or that might reasonably be expected to cause or
         result in, under the Exchange Act or otherwise, stabilization or
         manipulation of the price of any security of the Fund to facilitate the
         sale


<PAGE>
                                                                               8


         or resale of the Preferred Shares, and the Fund is not aware of any
         such action taken or to be taken by any affiliates of the Fund.

                  (z) This Agreement and each of the Fund Agreements complies in
         all material respects with all applicable provisions of the 1940 Act,
         the 1940 Act Rules and Regulations, the Advisers Act and the Advisers
         Act Rules and Regulations.

                  (aa) The Fund intends to direct the investment of the proceeds
         of the offering of the Preferred Shares in such a manner as to comply
         with the requirements of Subchapter M of the Code.

                  (bb) The conduct by the Fund of its business (as described in
         the Prospectus) does not require it to be the owner, possessor or
         licensee of any patents, patent licenses, trademarks, service marks or
         trade names which it does not own, possess or license, except where the
         failure to own, possess or license any such patent, patent license,
         trademark, service mark or trade name does not have a material, adverse
         effect on the condition (financial or other), business, prospects,
         properties, net assets or results of operations of the Fund.

                  (cc) Except as disclosed in the Registration Statement and the
         Prospectus, the Fund (i) does not have any material lending or other
         relationship with any bank or lending affiliate of Citigroup Global
         Markets Holdings Inc. and (ii) does not intend to use any of the
         proceeds from the sale of the Preferred Shares hereunder to repay any
         outstanding debt owed to any affiliate of Citigroup Global Markets
         Holdings Inc.

                  (dd) The Common Shares are duly listed on the New York Stock
         Exchange (the "NYSE").

                  Any certificate signed by any officer of the Fund and
delivered to the Representative or counsel for the Underwriters in connection
with the offering of the Preferred Shares shall be deemed a representation and
warranty by the Fund, as to matters covered thereby, to each Underwriter.

                  2. Representations and Warranties of the Adviser. The Adviser
         represents and warrants to each Underwriter as follows:

                  (a) The Adviser has been duly formed and is validly existing
         in good standing as a corporation under the laws of the State of
         Illinois, with full corporate power and authority to own, lease and
         operate its properties and to conduct its business as described in the
         Prospectus, and is duly qualified to do business as a foreign
         corporation and is in good standing under the laws of each jurisdiction
         which requires such qualification, except where the failure to so
         qualify would not have a material, adverse effect on the condition
         (financial or other), business, prospects, properties, net assets or
         results of operations of the Adviser.

                  (b) The Adviser is duly registered as an investment adviser
         under the Advisers Act and is not prohibited by the Advisers Act, the
         1940 Act, the Advisers Act Rules and


<PAGE>
                                                                               9


         Regulations or the 1940 Act Rules and Regulations from acting under the
         Management Agreement and the Accounting Agreement as contemplated by
         the Prospectus.

                  (c) The Adviser has full power and authority to enter into
         this Agreement, the Management Agreement and the Accounting Agreement;
         the execution and delivery of, and the performance by the Adviser of
         its obligations under, this Agreement, the Management Agreement and the
         Accounting Agreement have been duly and validly authorized by the
         Adviser; and this Agreement, the Management Agreement and the
         Accounting Agreement have been duly executed and delivered by the
         Adviser and constitute the valid and legally binding agreements of the
         Adviser, enforceable against the Adviser in accordance with their
         terms, except as rights to indemnity and contribution hereunder may be
         limited by federal or state securities laws and subject to the
         qualification that the enforceability of the Adviser's obligations
         hereunder and thereunder may be limited by bankruptcy, insolvency,
         reorganization, moratorium and other laws relating to or affecting
         creditors' rights generally and by general equitable principles.

                  (d) The Adviser has the financial resources available to it
         necessary for the performance of its services and obligations as
         contemplated in the Prospectus and under this Agreement, the Management
         Agreement and the Accounting Agreement.

                  (e) The description of the Adviser and its business, and the
         statements attributable to the Adviser, in the Prospectus complied and
         comply in all material respects with the provisions of the Act, the
         1940 Act, the Advisers Act, the Rules and Regulations and the Advisers
         Act Rules and Regulations and did not and will not contain an untrue
         statement of a material fact or omit to state a material fact necessary
         in order to make the statements therein, in light of the circumstances
         under which they were made, not misleading.

                  (f) No action, suit or proceeding by or before any court or
         governmental agency, authority or body or any arbitrator involving the
         Adviser or its property is pending or, to the best knowledge of the
         Adviser, threatened that (i) is required to be described in the
         Prospectus that is not so described as required, (ii) could reasonably
         be expected to have a material adverse effect on the ability of the
         Adviser to fulfill its obligations hereunder or under the Management
         Agreement and the Accounting Agreement or (iii) could reasonably be
         expected to have a material adverse effect on the condition (financial
         or otherwise), prospects, earnings, business or properties of the
         Adviser, whether or not arising from transactions in the ordinary
         course of business, except as set forth in or contemplated in the
         Prospectus (exclusive of any supplement thereto).

                  (g) Since the date as of which information is given in the
         Prospectus, except as otherwise stated therein, (i) there has been no
         material, adverse change in the condition (financial or other),
         business, properties, net assets or results of operations or business
         prospects of the Adviser, whether or not arising from the ordinary
         course of business and (ii) there have been no transactions entered
         into by the Adviser which are material to the Adviser other than those
         in the ordinary course of its business as described in the Prospectus.


<PAGE>
                                                                              10


                  (h) The Adviser has such licenses, permits and authorizations
         of governmental or regulatory authorities ("permits") as are necessary
         to own its property and to conduct its business in the manner described
         in the Prospectus, except where the failure to hold any such permit
         does not have a material, adverse effect on the condition (financial or
         other), business, prospects, properties, net assets or results of
         operations of the Adviser or on the ability of the Adviser to perform
         its obligations under this Agreement, the Management Agreement and the
         Accounting Agreement; the Adviser has fulfilled and performed all its
         material obligations with respect to such permits and no event has
         occurred which allows, or after notice or lapse of time would allow,
         revocation or termination thereof or results in any other material
         impairment of the rights of the Adviser under any such permit.

                  (i) This Agreement, the Management Agreement and the
         Accounting Agreement comply in all material respects with all
         applicable provisions of the 1940 Act, the 1940 Act Rules and
         Regulations, the Advisers Act and the Advisers Act Rules and
         Regulations.

                  (j) No consent, approval, authorization, filing with or order
         of any court or governmental agency or body is required in connection
         with the transactions contemplated herein or in the Management
         Agreement and the Accounting Agreement, except such as have been made
         or obtained under the Act and the 1940 Act and such as may be required
         under the blue sky laws of any jurisdiction in connection with the
         purchase and distribution of the Preferred Shares by the Underwriters
         in the manner contemplated herein and in the Prospectus.

                  (k) Neither the execution, delivery or performance of this
         Agreement, the Management Agreement and the Accounting Agreement, nor
         the consummation by the Fund or the Adviser of the transactions
         contemplated hereby or thereby (i) conflicts or will conflict with or
         constitutes or will constitute a breach of the certificate of
         incorporation or By-Laws of the Adviser, (ii) conflicts or will
         conflict with or constitutes or will constitute a breach of or a
         default under, any material agreement, indenture, lease or other
         instrument to which the Adviser is a party or by which it or any of its
         properties may be bound or (iii) materially violates or will materially
         violate any material statute, law, regulation or filing or judgment,
         injunction, order or decree applicable to the Adviser or any of its
         properties or will result in the creation or imposition of any material
         lien, charge or encumbrance upon any property or assets of the Adviser
         pursuant to the terms of any agreement or instrument to which the
         Adviser is a party or by which the Adviser may be bound or to which any
         of the property or assets of the Adviser is subject.

                  (l) Except as stated in this Agreement and in the Prospectus,
         the Adviser has not taken nor will it take, directly or indirectly, any
         action designed to or which should reasonably be expected to cause or
         result in or which will constitute, stabilization or manipulation of
         the price of any security of the Fund in violation of federal
         securities laws and the Adviser is not aware of any such action taken
         or to be taken by any affiliates of the Adviser.

                  (m) In the event that the Fund or the Adviser makes available
         any promotional materials intended for use only by qualified
         broker-dealers and registered representatives


<PAGE>
                                                                              11

         thereof by means of an Internet web site or similar electronic means,
         the Adviser will install and maintain pre-qualification and
         password-protection or similar procedures which are reasonably designed
         to effectively prohibit access to such promotional materials by persons
         other than qualified broker-dealers and registered representatives
         thereof.

                  Any certificate signed by any officer of the Adviser and
delivered to the Representative or counsel for the Underwriters in connection
with the offering of the Preferred Shares shall be deemed a representation and
warranty by the Adviser, as to matters covered thereby, to each Underwriter.

                  3. Purchase and Sale. Subject to the terms and conditions and
in reliance upon the representations and warranties herein set forth, the Fund
agrees to sell to each Underwriter, and each Underwriter agrees, severally and
not jointly, to purchase from the Fund, at a purchase price of $ per share, the
amount of the Preferred Shares set forth opposite such Underwriter's name in
Schedule I hereto.

                  4. Delivery and Payment. Delivery of and payment for the
Preferred Shares shall be made at 10:00 AM, New York City time, on      , 2004
or at such time on such later date not more than three Business Days after the
foregoing date as the Representative shall designate, which date and time may be
postponed by agreement between the Representative and the Fund or as provided in
Section 10 hereof (such date and time of delivery and payment for the Preferred
Shares being herein called the "Closing Date"). Delivery of the Preferred Shares
shall be made to the Representative for the respective accounts of the several
Underwriters against payment by the several Underwriters through the
Representative of the purchase price thereof to or upon the order of the Fund by
wire transfer payable in same-day funds to an account specified by the Fund.
Delivery of the Preferred Shares shall be made through the facilities of The
Depository Trust Company unless the Representative shall otherwise instruct.

                  5. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the Preferred Shares for sale to the public as set
forth in the Prospectus.

                  6. Agreements of the Fund and the Adviser. The Fund and the
Adviser, jointly and severally, agree with the several Underwriters as follows:

                  (a) The Fund will use its best efforts to cause the
         Registration Statement, if not effective at the Execution Time, and any
         amendment thereof, to become effective. Prior to the termination of the
         offering of the Preferred Shares, the Fund will not file any amendment
         of the Registration Statement or supplement to the Prospectus or any
         Rule 462(b) Registration Statement unless the Fund has furnished you a
         copy for your review prior to filing and will not file any such
         proposed amendment or supplement to which you reasonably object.
         Subject to the foregoing sentence, if the Registration Statement has
         become or becomes effective pursuant to Rule 430A, or filing of the
         Prospectus is otherwise required under Rule 497, the Fund will cause
         the Prospectus, properly completed, and any supplement thereto to be
         filed in a form approved by the Representative with the Commission
         pursuant to Rule 497 within the time period prescribed and will provide
         evidence satisfactory to the Representative of such timely


<PAGE>
                                                                              12


         filing. The Fund will promptly advise the Representative (1) when the
         Registration Statement, if not effective at the Execution Time, shall
         have become effective, (2) when the Prospectus, and any supplement
         thereto, shall have been filed (if required) with the Commission
         pursuant to Rule 497 or when any Rule 462(b) Registration Statement
         shall have been filed with the Commission, (3) when, prior to
         termination of the offering of the Preferred Shares, any amendment to
         the Registration Statement shall have been filed or become effective,
         (4) of any request by the Commission or its staff for any amendment of
         the Registration Statement, or any Rule 462(b) Registration Statement,
         or for any supplement to the Prospectus or for any additional
         information, (5) of the issuance by the Commission of any stop order
         suspending the effectiveness of the Registration Statement or the
         institution or threatening of any proceeding for that purpose and (6)
         of the receipt by the Fund of any notification with respect to the
         suspension of the qualification of the Preferred Shares for sale in any
         jurisdiction or the institution or threatening of any proceeding for
         such purpose. The Fund will use its best efforts to prevent the
         issuance of any such stop order or the suspension of any such
         qualification and, if issued, to obtain as soon as possible the
         withdrawal thereof.

                  (b) If, at any time when a prospectus relating to the
         Preferred Shares is required to be delivered under the Act, any event
         occurs as a result of which, in the judgment of the Fund or in the
         reasonable opinion of counsel for the Underwriters, the Prospectus as
         then supplemented would include any untrue statement of a material fact
         or omit to state any material fact necessary to make the statements
         therein in the light of the circumstances under which they were made
         not misleading, or if it shall be necessary to amend the Registration
         Statement or supplement the Prospectus to comply with the Act, the 1940
         Act and the Rules and Regulations, the Fund promptly will (1) notify
         the Representative of any such event; (2) prepare and file with the
         Commission, subject to the second sentence of paragraph (a) of this
         Section 6, an amendment or supplement which will correct such statement
         or omission or effect such compliance; and (3) supply any supplemented
         Prospectus to you in such quantities as you may reasonably request.

                  (c) As soon as practicable, the Fund will make generally
         available to its security holders and to the Representative an earnings
         statement or statements of the Fund which will satisfy the provisions
         of Section 11(a) of the Act and Rule 158 under the Act.

                  (d) The Fund will furnish to the Representative and counsel
         for the Underwriters signed copies of the Registration Statement
         (including exhibits thereto) and to each other Underwriter a copy of
         the Registration Statement (without exhibits thereto) and, so long as
         delivery of a prospectus by an Underwriter or dealer may be required by
         the Act, as many copies of each Preliminary Prospectus and the
         Prospectus and any supplement thereto as the Representative may
         reasonably request.

                  (e) The Fund will cooperate with you and with counsel for the
         Underwriters in connection with the registration or qualification of
         the Preferred Shares for offering and sale by the several Underwriters
         and by dealers with the NASD and under the securities or blue sky laws
         of such jurisdictions as you may designate and will file such consents
         to service of process or other documents necessary or appropriate in
         order to effect such registration or qualification; provided that in no
         event shall the Fund be obligated to


<PAGE>
                                                                              13

         qualify to do business in any jurisdiction where it is not now so
         qualified or to take any action which would subject it to service of
         process in suits, other than those arising out of the offering or sale
         of the Preferred Shares, in any jurisdiction where it is not now so
         subject.

                  (f) Except as provided in this Agreement or pursuant to any
         dividend reinvestment plan of the Fund in effect on the date hereof,
         the Fund will not sell, contract to sell, grant any options or warrants
         to purchase or otherwise dispose of, any senior securities (as defined
         in the 1940 Act) other than the Preferred Shares or any securities
         convertible into, or exercisable, or exchangeable for, senior
         securities other than the Preferred Shares, or publicly announce an
         intention to effect any such transaction for a period of 180 days
         following the Execution Time, without the prior written consent of
         Citigroup Global Markets Inc.

                  (g) The Fund will comply with all applicable securities and
         other applicable laws, rules and regulations, including, without
         limitation, the Sarbanes-Oxley Act, and to use its best efforts to
         cause the Fund's trustees and officers, in their capacities as such, to
         comply with such laws, rules and regulations, including, without
         limitation, the provisions of the Sarbanes-Oxley Act.

                  (h) Except as stated in this Agreement and the Prospectus,
         neither the Fund nor the Adviser will take, directly or indirectly, any
         action designed to or that would constitute or that might reasonably be
         expected to cause or result in, under the Exchange Act or otherwise,
         stabilization or manipulation of the price of any security of the Fund
         to facilitate the sale or resale of the Preferred Shares.

                  (i) The Fund agrees to pay the costs and expenses relating to
         the following matters: (i) the preparation, printing or reproduction
         and filing with the Commission of the Registration Statement (including
         financial statements and exhibits thereto), each Preliminary
         Prospectus, the Prospectus and the 1940 Act Notification and each
         amendment or supplement to any of them; (ii) the printing (or
         reproduction) and delivery (including postage, air freight charges and
         charges for counting and packaging) of such copies of the Registration
         Statement, each Preliminary Prospectus, the Prospectus, any sales
         material and all amendments or supplements to any of them, as may, in
         each case, be reasonably requested for use in connection with the
         offering and sale of the Preferred Shares; (iii) the preparation,
         printing, authentication, issuance and delivery of certificates for the
         Preferred Shares, including any stamp or transfer taxes in connection
         with the original issuance and sale of the Preferred Shares; (iv) the
         printing (or reproduction) and delivery of this Agreement, any blue sky
         memorandum, dealer agreements and all other agreements or documents
         printed (or reproduced) and delivered in connection with the offering
         of the Preferred Shares; (v) the registration of the Preferred Shares
         under the Exchange Act; (vi) any registration or qualification of the
         Preferred Shares for offer and sale under the Preferred Shares or blue
         sky laws of the several states (including filing fees and the
         reasonable fees and expenses of counsel for the Underwriters relating
         to such registration and qualification); (vii) any filings required to
         be made with the NASD (including filing fees and the reasonable fees
         and expenses of counsel for the Underwriters relating to such filings);
         (viii) the transportation and other expenses


<PAGE>
                                                                              14


         incurred by or on behalf of Fund representatives in connection with
         presentations to prospective purchasers of the Preferred Shares; (ix)
         the fees and expenses of the Fund's accountants and the fees and
         expenses of counsel (including local and special counsel) for the Fund,
         (x) any expenses and fees for the cost of Rating Agencies (as defined
         below); and (xi) all other costs and expenses incident to the
         performance by the Fund of its obligations hereunder.

                  (j) The Fund will direct the investment of the net proceeds of
         the offering of the Preferred Shares in such a manner as to comply with
         the investment objectives, policies and restrictions of the Fund as
         described in the Prospectus.

                  (k) The Fund will comply with the requirements of Subchapter M
         of the Code to qualify as a regulated investment company under the
         Code.

                  (l) The Fund and the Adviser will use their reasonable best
         efforts to perform all of the agreements required of them by this
         Agreement and discharge all conditions of theirs to closing as set
         forth in this Agreement.

                  (m) The Fund will use its reasonable best efforts to cause the
         Preferred Shares, prior to the Closing Date, to be assigned a rating of
         `AAA' by Fitch Ratings ("Fitch") and `AAA' by Standard & Poor's ("S&P",
         and together with Fitch, the "Rating Agencies").

                  7. Conditions to the Obligations of the Underwriters. The
obligations of the Underwriters to purchase the Preferred Shares, shall be
subject to the accuracy of the representations and warranties on the part of the
Fund and the Adviser contained herein as of the Execution Time and the Closing
Date, to the accuracy of the statements of the Fund and Adviser made in any
certificates pursuant to the provisions hereof, to the performance by the Fund
or the Adviser of its obligations hereunder and to the following additional
conditions:

                  (a) If the Registration Statement has not become effective
         prior to the Execution Time, unless the Representative agrees in
         writing to a later time, the Registration Statement will become
         effective not later than (i) 6:00 PM New York City time on the date of
         determination of the public offering price, if such determination
         occurred at or prior to 3:00 PM New York City time on such date or (ii)
         9:30 AM on the Business Day following the day on which the public
         offering price was determined, if such determination occurred after
         3:00 PM New York City time on such date; if filing of the Prospectus,
         or any supplement thereto, is required pursuant to Rule 497, the
         Prospectus, and any such supplement, will be filed in the manner and
         within the time period required by Rule 497; and no stop order
         suspending the effectiveness of the Registration Statement shall have
         been issued and no proceedings for that purpose shall have been
         instituted or threatened.

                  (b) You shall have received on the Closing Date an opinion of
         Vedder, Price, Kaufman & Kammholz, special counsel for the Fund, dated
         the Closing Date and addressed to the Representative, in substantially
         the form attached as Exhibit A, which opinion may rely as to matters of
         Delaware law on the opinion of Morris, Nichols, Arsht & Tunnell,
         special Delaware counsel for the Fund, dated the Closing Date and
         addressed


<PAGE>
                                                                              15


         to the Representative, in substantially the form attached as Exhibit B.
         The opinion of Morris, Nichols, Arsht & Tunnell shall state that
         Simpson Thacher & Bartlett LLP, counsel for the Underwriters, may rely
         on such opinion as to matters of Delaware law for the purposes of
         rendering its opinion referenced in Section 7(d).

                  (c) You shall have received on the Closing Date an opinion of
         Vedder, Price, Kaufman & Kammholz, special counsel for the Adviser,
         dated the Closing Date and addressed to the Representative, in
         substantially the form attached as Exhibit C. The opinion of Vedder,
         Price, Kaufman & Kammholz shall state that Simpson Thacher & Bartlett
         LLP, counsel for the Underwriters, may rely on opinion 4 of Exhibit C
         as to matters of Illinois law for the purposes of rendering its opinion
         referenced in Section 7(d).

                  (d) The Representative shall have received from Simpson
         Thacher & Bartlett LLP, counsel for the Underwriters, such opinion or
         opinions, dated the Closing Date and addressed to the Representative,
         with respect to the issuance and sale of the Preferred Shares, the
         Registration Statement, the Prospectus (together with any supplement
         thereto) and other related matters as the Representative may reasonably
         require, and the Fund and the Adviser shall have furnished to such
         counsel such documents as they request for the purpose of enabling them
         to pass upon such matters.

                  (e) Each of the Fund and the Adviser shall have furnished to
         the Representative a certificate, signed by the president, any managing
         director or any vice president and of the controller, treasurer or
         assistant treasurer of each of the Fund and the Adviser, dated the
         Closing Date, to the effect that the signers of such certificates have
         carefully examined the Registration Statement, the Prospectus, any
         supplements to the Prospectus and this Agreement and that:

                           (i) The representations and warranties of the Fund or
                  the Adviser, as the case may be, in this Agreement are true
                  and correct on and as of the Closing Date with the same effect
                  as if made on the Closing Date and the Fund or the Adviser, as
                  the case may be, have complied with all the agreements and
                  satisfied all the conditions on its part to be performed or
                  satisfied at or prior to the Closing Date;

                           (ii) No stop order suspending the effectiveness of
                  the Registration Statement has been issued and no proceedings
                  for that purpose have been instituted or, to the Fund's or the
                  Adviser's knowledge, as the case may be, threatened; and

                           (iii) Since the date of the most recent financial
                  statements included in the Prospectus (exclusive of any
                  supplement thereto) (with respect to the Fund), and since the
                  date of the Prospectus (exclusive of any supplement thereto)
                  (with respect to the Adviser), there has been no material
                  adverse effect on the condition (financial or otherwise),
                  prospects, earnings, business or properties of the Fund or the
                  Adviser, as the case may be, whether or not arising from
                  transactions in the ordinary course of business, except as set
                  forth in or contemplated in the Prospectus (exclusive of any
                  supplement thereto).


<PAGE>
                                                                              16


                  (f) The Fund shall have requested and caused Deloitte & Touche
         LLP to have furnished to the Representative, at the Execution Time and
         at the Closing Date, letters, dated respectively as of the Execution
         Time and as of the Closing Date, in form and substance heretofore
         approved by the Representative.

                  (g) Subsequent to the Execution Time or, if earlier, the dates
         as of which information is given in the Registration Statement
         (exclusive of any amendment thereof) and the Prospectus (exclusive of
         any supplement thereto), there shall not have been (i) any material
         change specified in the letter referred to in paragraph (f) of this
         Section 7 delivered on the Closing Date from the letter delivered at
         the Execution Time or (ii) any change, or any development involving a
         prospective change, in or affecting the condition (financial or
         otherwise), earnings, business or properties of the Fund and the
         Adviser, whether or not arising from transactions in the ordinary
         course of business, except as set forth in or contemplated in the
         Prospectus (exclusive of any supplement thereto) the effect of which,
         in any case referred to in clause (i) or (ii) above, is, in the sole
         judgment of the Representative, so material and adverse as to make it
         impractical or inadvisable to proceed with the offering or delivery of
         the Preferred Shares as contemplated by the Registration Statement
         (exclusive of any amendment thereof) and the Prospectus (exclusive of
         any supplement thereto).

                  (h) The Fund shall have furnished to you as soon as
         practicable from the Closing Date a report showing compliance with the
         asset coverage requirements of the 1940 Act and a Preferred Shares
         Basic Maintenance Report (as defined in the Statement), each in form
         and substance satisfactory to you. Each such report shall assume the
         receipt of the net proceeds from the sale of the Preferred Shares and
         may use portfolio holdings and valuations as of the close of business
         of any day not more than six business days preceding the Closing Date,
         provided, however, that the Fund represents in such report that its
         total net assets as of the Closing Date have not declined by 5% or more
         from such valuation date.

                  (i) The Fund shall have delivered and the Underwriters shall
         have received evidence satisfactory to the Underwriters that each
         series of Preferred Shares is rated `AAA' by Fitch and `AAA' by S&P as
         of the Closing Date, and there shall not have been given any notice of
         any intended or potential downgrading, or of any review for a potential
         downgrading, in the rating accorded to the shares of each series of the
         Preferred Shares by either Rating Agency.

                  (j) Prior to the Closing Date, the Fund and the Adviser shall
         have furnished to the Representative such further information,
         certificates and documents as the Representative may reasonably
         request.

                  If any of the conditions specified in this Section 7 shall not
have been fulfilled when and as provided in this Agreement, or if any of the
opinions and certificates mentioned above or elsewhere in this Agreement shall
not be reasonably satisfactory in form and substance to the Representative and
counsel for the Underwriters, this Agreement and all obligations of the
Underwriters hereunder may be canceled at, or at any time prior to, the Closing
Date by the


<PAGE>
                                                                              17


Representative. Notice of such cancellation shall be given to the Fund in
writing or by telephone or facsimile confirmed in writing.

                  The documents required to be delivered by this Section 7 shall
be delivered at the office of Simpson Thacher & Bartlett LLP, counsel for the
Underwriters, at 425 Lexington Avenue, New York, New York, 10017, on the Closing
Date.

                  8. Reimbursement of Underwriters' Expenses. If the sale of the
Preferred Shares provided for herein is not consummated because any condition to
the obligations of the Underwriters set forth in Section 7 hereof is not
satisfied, because of any termination pursuant to Section 11 hereof or because
of any refusal, inability or failure on the part of the Fund or the Adviser to
perform any agreement herein or comply with any provision hereof other than by
reason of a default by any of the Underwriters, the Fund and the Adviser,
jointly and severally, agree to reimburse the Underwriters severally through
Citigroup Global Markets Inc. on demand for all reasonable out-of-pocket
expenses (including reasonable fees and disbursements of counsel) that shall
have been incurred by them in connection with the proposed purchase and sale of
the Preferred Shares.

                  9. Indemnification and Contribution. (a) The Fund and the
Adviser, jointly and severally, agree to indemnify and hold harmless each of you
and each other Underwriter, the directors, officers, employees and agents of
each Underwriter and each person who controls any Underwriter within the meaning
of either the Act or the Exchange Act against any and all losses, claims,
damages or liabilities, joint or several (including reasonable costs of
investigation), to which they or any of them may become subject under the Act,
the Exchange Act or other Federal or state statutory law or regulation, at
common law or otherwise, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement, the Prospectus, any Preliminary Prospectus, any sales
material (or any amendment or supplement to any of the foregoing), or arise out
of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, and agrees to reimburse each such indemnified party, as
incurred, for any legal or other expenses reasonably incurred by them in
connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the Fund and Adviser will not be
liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon any such untrue statement or alleged
untrue statement or omission or alleged omission made therein in reliance upon
and in conformity with written information furnished to the Fund or Adviser by
or on behalf of any Underwriter through the Representative specifically for
inclusion therein. This indemnity agreement will be in addition to any liability
which the Fund and Adviser may otherwise have.

                  (b) Each Underwriter severally and not jointly agrees to
indemnify and hold harmless each of the Fund and the Adviser, each of their
directors, trustees, each officer who signs the Registration Statement, and each
person who controls the Fund or the Adviser within the meaning of either the Act
or the Exchange Act, to the same extent as the foregoing indemnity from the Fund
and the Adviser to each Underwriter, but only with reference to written
information relating to such Underwriter furnished to the Fund or the Adviser by
or on behalf of such Underwriter through the Representative specifically for
inclusion in the documents referred


<PAGE>
                                                                              18


to in the foregoing indemnity. This indemnity agreement will be in addition to
any liability which any Underwriter may otherwise have. The Fund and the Adviser
acknowledge that the statements set forth in the last paragraph of the cover
page regarding delivery of the Preferred Shares and, under the heading
"Underwriting", (i) the list of Underwriters and their respective participation
in the sale of the Preferred Shares, (ii) the sentences related to concessions
and reallowances, (iii) the paragraph related to stabilization, syndicate
covering transactions and penalty bids and (iv) the paragraph related to
prospectuses in electronic format in any Preliminary Prospectus and the
Prospectus constitute the only information furnished in writing by or on behalf
of the several Underwriters for inclusion in any Preliminary Prospectus or the
Prospectus.

                  (c) Promptly after receipt by an indemnified party under this
Section 9 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section 9, notify the indemnifying party in writing of the
commencement thereof; but the failure so to notify the indemnifying party (i)
will not relieve it from liability under paragraph (a) or (b) above unless and
to the extent it did not otherwise learn of such action and such failure results
in the forfeiture by the indemnifying party of substantial rights and defenses
and (ii) will not, in any event, relieve the indemnifying party from any
obligations to any indemnified party other than the indemnification obligation
provided in paragraph (a) or (b) above. The indemnifying party shall be entitled
to appoint counsel of the indemnifying party's choice at the indemnifying
party's expense to represent the indemnified party in any action for which
indemnification is sought (in which case the indemnifying party shall not
thereafter be responsible for the fees and expenses of any separate counsel
retained by the indemnified party or parties except as set forth below);
provided, however, that such counsel shall be satisfactory to the indemnified
party. Notwithstanding the indemnifying party's election to appoint counsel to
represent the indemnified party in an action, the indemnified party shall have
the right to employ separate counsel (including local counsel), and the
indemnifying party shall bear the reasonable fees, costs and expenses of such
separate counsel if (i) the use of counsel chosen by the indemnifying party to
represent the indemnified party would present such counsel with a conflict of
interest, (ii) the actual or potential defendants in, or targets of, any such
action include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be legal
defenses available to it and/or other indemnified parties which are different
from or additional to those available to the indemnifying party, (iii) the
indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable time
after notice of the institution of such action or (iv) the indemnifying party
shall authorize the indemnified party to employ separate counsel at the expense
of the indemnifying party.

                  (d) In the event that the indemnity provided in paragraph (a)
or (b) of this Section 9 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, the Fund, the Adviser and the Underwriters
severally agree to contribute to the aggregate losses, claims, damages and
liabilities (including legal or other expenses reasonably incurred in connection
with investigating or defending same) (collectively "Losses") to which the Fund,
the Adviser and one or more of the Underwriters may be subject in such
proportion as is appropriate to reflect the relative benefits received by the
Fund and the Adviser on the one hand (treated jointly for this purpose as one
person) and by the Underwriters on the other from the offering of the Preferred
Shares; provided, however, that in no case shall any Underwriter (except as may
be

<PAGE>
                                                                              19


provided in any agreement among underwriters relating to the offering of the
Preferred Shares) be responsible for any amount in excess of the underwriting
discount or commission applicable to the Preferred Shares purchased by such
Underwriter hereunder. If the allocation provided by the immediately preceding
sentence is unavailable for any reason, the Fund, the Adviser and the
Underwriters severally shall contribute in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the Fund
and the Adviser on the one hand (treated jointly for this purpose as one person)
and of the Underwriters on the other in connection with the statements or
omissions which resulted in such Losses as well as any other relevant equitable
considerations. Benefits received by the Fund and the Adviser (treated jointly
for this purpose as one person) shall be deemed to be equal to the total net
proceeds from the offering (before deducting expenses) received by it, and
benefits received by the Underwriters shall be deemed to be equal to the total
underwriting discounts and commissions, in each case as set forth on the cover
page of the Prospectus. Relative fault shall be determined by reference to,
among other things, whether any untrue or any alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information provided by the Fund and the Adviser on the one hand
(treated jointly for this purpose as one person) or the Underwriters on the
other, the intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such untrue statement or
omission. The Fund, the Adviser and the Underwriters agree that it would not be
just and equitable if contribution pursuant to this Section 9 were determined by
pro rata allocation or any other method of allocation which does not take
account of the equitable considerations referred to above. Notwithstanding the
provisions of this paragraph (d), no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 9, each person who controls an
Underwriter within the meaning of either the Act or the Exchange Act and each
director, officer, employee and agent of an Underwriter shall have the same
rights to contribution as such Underwriter, and each person who controls the
Fund or the Adviser within the meaning of either the Act or the Exchange Act,
each officer of the Fund and the Adviser who shall have signed the Registration
Statement and each director of the Fund and the Adviser shall have the same
rights to contribution as the Fund and the Adviser, subject in each case to the
applicable terms and conditions of this paragraph (d).

                  (e) No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened action, suit or proceeding in respect of which any indemnified party
is or could have been a party and indemnity could have been sought hereunder by
such indemnified party, unless such settlement includes an unconditional release
of such indemnified party from all liability from claimants on claims that are
the subject matter of such action, suit or proceeding.

                  (f) Any losses, claims, damages, liabilities or expenses for
which an indemnified party is entitled to indemnification or contribution under
this Section 9 shall be paid by the indemnifying party to the indemnified party
as such losses, claims, damages, liabilities or expenses are incurred. The
indemnity and contribution agreements contained in this Section 9 and the
representations and warranties of the Fund and the Adviser set forth in this
Agreement shall remain operative and in full force and effect, regardless of (i)
any investigation made by or on behalf of any Underwriter or any person
controlling any Underwriter, the Fund, the Adviser or their shareholders,
trustees, directors, managers, members or officers or any person controlling


<PAGE>
                                                                              20


the Fund or the Adviser (control to be determined within the meaning of the Act
or the Exchange Act), (ii) acceptance of any Preferred Shares and payment
therefor hereunder and (iii) any termination of this Agreement. A successor to
any Underwriter or to the Fund, the Adviser or their shareholders, trustees,
directors, managers, members or officers or any person controlling any
Underwriter, the Fund or the Adviser shall be entitled to the benefits of the
indemnity, contribution and reimbursement agreements contained in this Section
9.

                  10. Default by an Underwriter. If any one or more Underwriters
shall fail to purchase and pay for any of the Preferred Shares agreed to be
purchased by such Underwriter or Underwriters hereunder and such failure to
purchase shall constitute a default in the performance of its or their
obligations under this Agreement, the remaining Underwriters shall be obligated
severally to take up and pay for (in the respective proportions which the amount
of Preferred Shares set forth opposite their names in Schedule I hereto bears to
the aggregate amount of Preferred Shares set forth opposite the names of all the
remaining Underwriters or in such other proportion as you may specify in
accordance with the Citigroup Global Markets Inc. Master Agreement Among
Underwriters) the Preferred Shares which the defaulting Underwriter or
Underwriters agreed but failed to purchase; provided, however, that in the event
that the aggregate amount of Preferred Shares which the defaulting Underwriter
or Underwriters agreed but failed to purchase shall exceed 10% of the aggregate
amount of Preferred Shares set forth in Schedule I hereto, the remaining
Underwriters shall have the right to purchase all, but shall not be under any
obligation to purchase any, of the Preferred Shares, and if such nondefaulting
Underwriters do not purchase all the Preferred Shares, this Agreement will
terminate without liability to any nondefaulting Underwriter, the Fund or the
Adviser. In the event of a default by any Underwriter as set forth in this
Section 10, the Closing Date shall be postponed for such period, not exceeding
five Business Days, as the Representative shall determine in order that the
required changes in the Registration Statement and the Prospectus or in any
other documents or arrangements may be effected. Nothing contained in this
Agreement shall relieve any defaulting Underwriter of its liability, if any, to
the Fund and any nondefaulting Underwriter for damages occasioned by its default
hereunder.

                  11. Termination. This Agreement shall be subject to
termination in the absolute discretion of the Representative, without liability
on the part of the Underwriters to the Fund or the Adviser, by notice given to
the Fund or the Adviser prior to delivery of and payment for the Preferred
Shares, if at any time prior to such time (i) trading in the Common Shares shall
have been suspended by the Commission or the NYSE or trading in securities
generally on the NYSE shall have been suspended or limited or minimum prices
shall have been established on the NYSE, (ii) a banking moratorium shall have
been declared either by Federal or New York State authorities or (iii) there
shall have occurred any outbreak or escalation of hostilities, declaration by
the United States of a national emergency or war, or other calamity or crisis
the effect of which on financial markets is such as to make it, in the sole
judgment of the Representative, impractical or inadvisable to proceed with the
offering or delivery of the Preferred Shares as contemplated by the Prospectus
(exclusive of any supplement thereto).

                  12. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Fund and the Adviser or their officers and of the Underwriters set forth in or
made pursuant to this Agreement will remain in full force and effect, regardless
of any investigation made by or on behalf of any Underwriter or


<PAGE>
                                                                              21


the Fund or the Adviser or any of the officers, trustees, directors, employees,
agents or controlling persons referred to in Section 9 hereof, and will survive
delivery of and payment for the Preferred Shares. The provisions of Sections 8
and 9 hereof shall survive the termination or cancellation of this Agreement.

                  13. Notices. All communications hereunder will be in writing
and effective only on receipt, and, if sent to the Representative, will be
mailed, delivered or telefaxed to the Citigroup Global Markets Inc. General
Counsel (fax no.: (212) 816-7912) and confirmed to the General Counsel,
Citigroup Global Markets Inc., at 388 Greenwich Street, New York, New York,
10013, Attention: General Counsel; or, if sent to the Fund or the Adviser, will
be mailed, delivered or telefaxed to: c/o Calamos Asset Management, Inc. at 1111
E. Warrenville Road, Naperville, Illinois 60563, Attention: General Counsel,
(fax no.: (630) 245-6343).

                  14. Successors. This Agreement will inure to the benefit of
and be binding upon the parties hereto and their respective successors and the
officers, trustees, directors, employees, agents and controlling persons
referred to in Section 9 hereof, and no other person will have any right or
obligation hereunder.

                  15. Applicable Law. This Agreement will be governed by and
construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed within the State of New York.

                  16. Counterparts. This Agreement may be signed in one or more
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same agreement.

                  17. Headings. The section headings used herein are for
convenience only and shall not affect the construction hereof.

                  18. Definitions. The terms which follow, when used in this
Agreement, shall have the meanings indicated.

                  "1940 Act" shall mean the Investment Company Act of 1940, as
         amended.

                  "1940 Act Rules and Regulations" shall mean the rules and
         regulations of the Commission under the 1940 Act.

                  "1940 Act Notification" shall mean a notification of
         registration of the Fund as an investment company under the 1940 Act on
         Form N-8A, as the 1940 Act Notification may be amended from time to
         time.

                  "Act" shall mean the Securities Act of 1933, as amended.

                  "Act Rules and Regulations" shall mean the rules and
         regulations of the Commission under the Act.

                  "Advisers Act" shall mean the Investment Advisers Act of 1940,
         as amended.


<PAGE>
                                                                              22


                  "Advisers Act Rules and Regulations" shall mean the rules and
         regulations of the Commission under the Advisers Act.

                  "Business Day" shall mean any day other than a Saturday, a
         Sunday or a legal holiday or a day on which banking institutions or
         trust companies are authorized or obligated by law to close in New York
         City.

                  "Commission" shall mean the Securities and Exchange
         Commission.

                  "Effective Date" shall mean each date and time that the
         Registration Statement, any post-effective amendment or amendments
         thereto and any Rule 462(b) Registration Statement became or become
         effective.

                  "Exchange Act" shall mean the Securities Exchange Act of 1934,
         as amended, and the rules and regulations of the Commission promulgated
         thereunder.

                  "Execution Time" shall mean the date and time that this
         Agreement is executed and delivered by the parties hereto.

                  "Preliminary Prospectus" shall mean any preliminary prospectus
         (including the statement of additional information incorporated by
         reference therein) referred to in paragraph 1(a) above and any
         preliminary prospectus (including the statement of additional
         information incorporated by reference therein) included in the
         Registration Statement at the Effective Date that omits Rule 430A
         Information.

                  "Prospectus" shall mean the prospectus (including the
         statement of additional information incorporated by reference therein)
         relating to the Preferred Shares that is first filed pursuant to Rule
         497 after the Execution Time or, if no filing pursuant to Rule 497 is
         required, shall mean the form of final prospectus (including the
         statement of additional information incorporated by reference therein)
         relating to the Preferred Shares included in the Registration Statement
         at the Effective Date.

                  "Registration Statement" shall mean the registration statement
         referred to in paragraph 1(a) above, including exhibits and financial
         statements, as amended at the Execution Time (or, if not effective at
         the Execution Time, in the form in which it shall become effective)
         and, in the event any post-effective amendment thereto or any Rule
         462(b) Registration Statement becomes effective prior to the Closing
         Date, shall also mean such registration statement as so amended or such
         Rule 462(b) Registration Statement, as the case may be. Such term shall
         include any Rule 430A Information deemed to be included therein at the
         Effective Date as provided by Rule 430A.

                  "Rule 430A" and "Rule 462" refer to such rules under the Act.

                  "Rule 430A Information" shall mean information with respect to
         the Preferred Shares and the offering thereof permitted to be omitted
         from the Registration Statement when it becomes effective pursuant to
         Rule 430A.


<PAGE>
                                                                              23


                  "Rule 462(b) Registration Statement" shall mean a registration
         statement and any amendments thereto filed pursuant to Rule 462(b)
         relating to the offering covered by the registration statement referred
         to in Section 1(a) hereof.

                  "Rule 497" refers to Rule 497(c) or 497(h) under the Act, as
         applicable.

                  "Rules and Regulations" shall mean, collectively, the Act
         Rules and Regulations and the 1940 Act Rules and Regulations.



<PAGE>
                                                                              24




                  If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and your acceptance shall represent a binding agreement
among the Fund, the Adviser and the several Underwriters.



                                     Very truly yours,

                                     CALAMOS STRATEGIC TOTAL RETURN FUND


                                     By:
                                          --------------------------------------
                                          Name:
                                          Title:


                                     CALAMOS ASSET MANAGEMENT, INC.


                                     By:
                                          --------------------------------------
                                          Name:
                                          Title:




<PAGE>
                                                                              25




The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.

Citigroup Global Markets Inc.

     By:
          ---------------------------------------------
          Name:
          Title:

For itself and the other
several Underwriters named in
Schedule I to the foregoing
Agreement.


<PAGE>
                                   SCHEDULE I


<TABLE>
<CAPTION>
                                         NUMBER        NUMBER       NUMBER       NUMBER       NUMBER         NUMBER        NUMBER
                                       OF SHARES     OF SHARES    OF SHARES    OF SHARES    OF SHARES      OF SHARES     OF SHARES
                                           OF            OF           OF           OF           OF             OF            OF
UNDERWRITERS                            SERIES M      SERIES T     SERIES W    SERIES TH     SERIES F       SERIES A      SERIES B
------------
<S>                                     <C>          <C>          <C>          <C>          <C>            <C>           <C>

Citigroup Global Markets Inc. ........

Merrill Lynch, Pierce, Fenner & Smith
                     Incorporated.....

UBS Securities LLC....................



                  Total...............
                                          ====          ====         ====         ====         ====         ====            ====
</TABLE>



<PAGE>


                                                                       EXHIBIT A



     Opinions of Vedder, Price, Kaufman & Kammholz, P.C. Regarding the Fund



         1. The Fund has been duly formed and is validly existing in good
standing as a statutory trust under the Delaware Act. The Fund has the statutory
trust power and authority to own property and conduct its business as described
in the Prospectus;

         2. Under the Delaware Act and the Declaration, the execution and
delivery of the Underwriting Agreement and each of the Fund Agreements by the
Fund, and the performance by the Fund of its obligations thereunder, have been
duly authorized by all requisite statutory trust action on the part of the Fund;
the Underwriting Agreement and each of the Fund Agreements have been duly
executed and delivered by the Fund; each of the Fund Agreements constitute the
valid and binding agreement of the Fund enforceable against the Fund in
accordance with its terms; and the Underwriting Agreement and each of the Fund
Agreements comply with all applicable provisions of the 1940 Act and the 1940
Act Rules and Regulations and the Advisers Act and the Advisers Act Rules and
Regulations;

         3. The Common Shares have been duly authorized for issuance by the
Fund, are validly issued and, subject to the qualifications below, fully paid
and non-assessable beneficial interests in the Fund. The holders of Common
Shares will be, subject to the terms of the Declaration, entitled to the same
limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the State
of Delaware; provided, however, that we express no opinion with respect to the
liability of any holder of Common Shares who is, was or may become a named
Trustee of the Fund;

         4. The Shares have been duly authorized for issuance by the Fund and,
when issued and delivered against payment therefor in accordance with the terms,
conditions, requirements and procedures set forth in the Underwriting Agreement,
will be validly issued and, subject to the qualifications below, fully paid and
non-assessable beneficial interests in the Fund. The holders of Shares will be,
subject to the terms of the Declaration, entitled to the same limitation of
personal liability extended to stockholders of private corporations for profit
organized under the General Corporation Law of the State of Delaware; provided,
however, that we express no opinion with respect to the liability of any holder
of Shares who is, was or may become a named Trustee of the Fund;

         5. Under the Declaration and the Delaware Act, the issuance of the
Shares is not subject to preemptive rights;

         6. The form of certificate evidencing the Shares complies with all
applicable requirements of the Delaware Act and the NYSE;

         7. The execution and delivery by the Fund of the Underwriting Agreement
and the Fund Agreements, the consummation by the Fund of the transactions
contemplated by the Underwriting Agreement and the Fund Agreements, the
performance by the Fund of its obligations thereunder, the issuance and sale by
the Fund of the Shares will not violate (i) the Organizational Documents or (ii)
any applicable Delaware law or administrative regulation;


                                       A-1

<PAGE>


         8. None of the issuance and sale of the Shares by the Fund pursuant to
the Underwriting Agreement, the execution and delivery of the Underwriting
Agreement or any of the Fund Agreements by the Fund, or the performance by the
Fund of its agreements under the Underwriting Agreement or any of the Fund
Agreements (A) requires any consent, approval, authorization or other order of
or registration or filing with, the Commission, the National Association of
Securities Dealers, Inc., or any national securities exchange, or governmental
body or agency, or arbitrator or court of the United States of America, or State
of Illinois or State of Delaware or, based solely on the Docket Search, an order
of any Delaware Court (as that term is defined in the opinion of Morris,
Nichols, Arsht & Tunnell) (except (1) the absence of which, either individually
or in the aggregate, would not have a material adverse effect on the Fund or the
offering of the Shares as contemplated in the Underwriting Agreement; (2) such
as may have been obtained prior to the date hereof; and (3) such as may be
required for compliance with state securities or blue sky laws of various
jurisdictions) or (B) violates or will violate or constitutes or will constitute
a breach of any of the provisions of the Statement or the Organizational
Documents of the Fund or (C) violates or will violate or constitutes or will
constitute a breach of, or a default under, any material agreement, indenture,
lease or other instrument known to us to which the Fund is party or by which it
or any of its properties may be bound, or violates any existing material United
States of America or State of Illinois or State of Delaware statute, law or
regulation (assuming compliance with all applicable state securities and blue
sky laws, and except that, in the published opinion of the Commission, the
indemnification provisions in the Underwriting Agreement and the Fund
Agreements, insofar as they relate to indemnification for liabilities arising
under the 1933 Act, are against public policy as expressed in the 1933 Act and
therefore unenforceable), or violates any judgment, injunction, order or decree
known to us to be applicable to the Fund or any of its properties, or will
result in the creation or imposition of any material lien, charge or encumbrance
upon any property or assets of the Fund pursuant to the terms of any agreement
or instrument known to us to which the Fund is a party or by which any of its
property or assets is bound. To the best of our knowledge, the Fund is not
subject to any order of any court or of any arbitrator, governmental authority
or administrative agency of the United States of America or the State of
Illinois;

         9. Based solely on the Docket Search, there is not any Delaware court
action, suit or proceeding pending against the Fund.

         10. The Registration Statement is effective under the 1933 Act and was
filed under the 1940 Act; any required filing of the Prospectus pursuant to Rule
497 of the 1933 Act Rules and Regulations has been made within the time periods
required by Rule 497; no stop-order suspending the effectiveness of the
Registration Statement or order pursuant to Section 8(e) of the 1940 Act has
been issued and to the best of our knowledge, no proceeding for any such purpose
has been instituted or is pending or threatened in writing by the Commission;

         11. The Fund is registered under the 1940 Act as a closed-end
diversified management investment company;

         12. The description of the authorized Common Shares contained under the
captions "Description of Preferred Shares," "The Auction" and "Description of
Common Shares" in the Prospectus conforms in all material respects as to legal
matters to the terms thereof contained in the Fund's Declaration and Statement;

                                       A-2
<PAGE>


         13. The statements made in the Prospectus under the captions "U.S.
Federal Income Tax Matters," insofar as they constitute matters of law or legal
conclusions, have been reviewed by us and constitute accurate statements of any
such matters of law or legal conclusions;

         14. The Registration Statement and the Prospectus and each amendment or
supplement to the Registration Statement and the Prospectus as of their
respective issue dates (except the financial statements and other financial data
contained therein, as to which we express no opinion) comply as to form in all
material respects with the requirements of the 1933 Act, the 1940 Act and the
Rules and Regulations;

         15. To the best of our knowledge, there are no legal or governmental
proceedings pending or threatened in writing against the Fund, or to which the
Fund or any of its properties is subject, that are required to be described in
the Registration Statement or the Prospectus, but are not described therein as
required;

         16. To the best of our knowledge, there are no material agreements,
contracts, indentures, leases or other instruments that are required to be
described in the Registration Statement or the Prospectus, or to be filed as an
exhibit to the Registration Statement that are not described or filed as
required by the 1933 Act, the 1940 Act or the Rules and Regulations; and

         We have participated in conferences with officers and employees of the
Fund, Adviser, representatives of the independent auditors for the Fund, special
Delaware counsel to the Fund, the Underwriters and counsel for the Underwriters
at which the contents of the Registration Statement and the Prospectus and
related matters were discussed and, although we are not passing upon, and do not
assume any responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement or the Prospectus, except to
the limited extent otherwise covered by paragraphs 12 and 13 hereof and have
made no independent check or verification thereof, on the basis of the
foregoing, no facts have come to our attention that would have led us to believe
that (a) the Registration Statement, at the time it became effective, contained
any untrue statement of a material fact or omitted to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading, (b) the Prospectus, as of its date and as of the Closing Date,
contained or contains an untrue statement of a material fact or omitted or omits
to state a material fact necessary to make the statements contained therein, in
the light of the circumstances under which they were made, not misleading, or
(c) the 1940 Act Notification as of January 7, 2004 contained any untrue
statement of a material fact or omitted to state any material fact required to
be stated therein or necessary in order to make the statements therein not
misleading, except that in each case we express no belief with respect to the
financial statements, schedules and other financial information and statistical
data included therein or excluded therefrom or the exhibits to the Registration
Statement.


                                       A-3
<PAGE>

                                                                       EXHIBIT B


                  Opinions of Morris, Nichols, Arsht & Tunnell

         1. The Fund has been duly formed and is validly existing in good
standing as a statutory trust under the Delaware Act. The Fund has the statutory
trust power and authority to own property and conduct its business as described
in the Prospectus.

         2. Under the Delaware Act and the Governing Instrument, the execution
and delivery of the Underwriting Agreement and each of the Fund Agreements by
the Fund, and the performance by the Fund of its obligations thereunder, have
been duly authorized by all requisite statutory trust action on the part of the
Fund.

         3. The Common Shares have been duly authorized for issuance by the
Fund, are validly issued and, subject to the qualifications below, fully paid
and non-assessable beneficial interests in the Common Series. The holders of the
Common Shares will be, subject to the terms of the Governing Instrument,
entitled to the same limitation of personal liability extended to stockholders
of private corporations for profit organized under the General Corporation Law
of the State of Delaware; provided, however, that we express no opinion with
respect to the liability of any holder of Common Shares who is, was or may
become a named Trustee of the Fund.

         4. The Preferred Shares have been duly authorized for issuance by the
Fund and, when issued and delivered against payment therefor in accordance with
the terms, conditions, requirements and procedures set forth in the Underwriting
Agreement, will be validly issued and, subject to the qualifications below,
fully paid and non-assessable beneficial interests in the Series. The holders of
Preferred Shares will be, subject to the terms of the Governing Instrument,
entitled to the same limitation of personal liability extended to stockholders
of private corporations for profit organized under the General Corporation Law
of the State of Delaware; provided, however, that we express no opinion with
respect to the liability of any holder of Preferred Shares who is, was or may
become a named Trustee of the Fund.

         5. Under the Governing Instrument and the Delaware Act, the issuance of
the Preferred Shares is not subject to preemptive rights.

         6. The form of Preferred Shares Certificate complies with all
applicable requirements of the Delaware Act.

         7. No authorization, approval, consent or order of any governmental
authority or agency of the State of Delaware or, based solely on the Docket
Search, an order of any Delaware Court, is required to be obtained by the Fund
solely as a result of the issuance and sale of the Preferred Shares, the
consummation by the Fund of the transactions contemplated by the Underwriting
Agreement and the Fund Agreements or the performance by the Fund of its
obligations thereunder, or the adoption of the Automatic Dividend Reinvestment
Plan.

                                       B-1

<PAGE>

         8. The execution and delivery by the Fund of the Underwriting Agreement
and the Fund Agreements, the consummation by the Fund of the transactions
contemplated by the Underwriting Agreement and the Fund Agreements, the
performance by the Fund of its obligations thereunder, the issuance and sale by
the Fund of the Preferred Shares and the adoption of the Automatic Dividend
Reinvestment Plan will not violate (i) the Certificate or the Governing
Instrument or (ii) any applicable Delaware law or administrative regulation.

         9. Based solely on the Docket Search, there is not in any Delaware
Court any action, suit or proceeding pending against the Fund.

         With respect to the opinions expressed in paragraphs 3 and 4 above, we
note that, pursuant to Section 2 of Article VIII of the Governing Instrument,
the Trustees have the power to cause each Shareholder, or each Shareholder of
any particular Series, to pay directly, in advance or arrears, for charges of
the Fund's custodian or transfer, shareholder servicing or similar agent, an
amount fixed from time to time by the Trustees, by setting off such charges due
from such Shareholder from declared but unpaid dividends owed such Shareholder
and/or by reducing the number of Shares in the account of such Shareholder by
that number of full and/or fractional Shares which represents the outstanding
amount of such charges due from such Shareholder.


                                       B-2

<PAGE>
                                                                       EXHIBIT C



    Opinions of Vedder, Price, Kaufman & Kammholz, P.C. Regarding the Adviser




         1. The Adviser is validly existing as a corporation in good standing
under the laws of the State of Illinois.

         2. The Adviser has full corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectus and to enter into and perform its obligations under the Underwriting
Agreement, the Management Agreement and the Accounting Agreement.

         3. The Adviser is registered with the Commission as an investment
adviser under the Advisers Act and is not prohibited by the Advisers Act, the
Advisers Act Rules and Regulations, the 1940 Act or the 1940 Act Rules and
Regulations from acting under the Management Agreement and the Accounting
Agreement as contemplated by the Prospectus.

         4. The Underwriting Agreement, the Management Agreement and the
Accounting Agreement have been duly authorized by all requisite corporate action
on the part of the Adviser, have each been duly executed and delivered on behalf
of the Adviser, and each of the Management Agreement and the Accounting
Agreement constitutes a valid and binding obligation of the Adviser, enforceable
against the Adviser in accordance with its terms.

         5. To the best of our knowledge, there is not pending or threatened in
writing any action, suit, proceeding, inquiry or investigation, to which the
Adviser is a party, or to which the property of the Adviser is subject, before
or brought by any court or governmental agency or body, which might reasonably
be expected to (i) result in any material adverse change in the condition,
financial or otherwise, earnings, business affairs or business prospects of the
Adviser, (ii) materially and adversely affect the properties or assets of the
Adviser or (iii) materially impair or adversely affect the ability of the
Adviser to function as an investment adviser or perform its obligations under
the Management Agreement and the Accounting Agreement, or which is required to
be disclosed in the Registration Statement or the Prospectus.

         6. No filing with, or authorization, approval, consent, license, order,
registration, qualification or decree of, any court or governmental authority or
agency of the United States of America or the State of Illinois (other than (i)
under the 1933 Act, the 1940 Act and the Rules and Regulations; (ii) such as
have been obtained; and (iii) as may be required under the securities or blue
sky laws of the various states, as to each of which we express no opinion) is
necessary or required in connection with the performance by the Adviser of its
obligations under the Management Agreement and the Accounting Agreement.

         7. The execution and delivery of the Underwriting Agreement the
Management Agreement and the Accounting Agreement by the Adviser, and


                                      C-1

<PAGE>

performance by the Adviser of its obligations thereunder do not and will not,
whether with or without the giving of notice or lapse of time or both: (A)
result in the creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Adviser, or (B) violate or constitute a breach of, or
default under any material contract, indenture, mortgage, deed of trust, loan or
credit agreement, note, lease or any other material agreement or instrument
known to us and to which the Adviser is a party or by which it may be bound, or
to which any of the property or assets of the Adviser is subject, or (C) violate
any applicable federal or State of Illinois law, statute, rule, regulation, or
any judgment, order, writ or decree, known to us, of any governmental authority
or administrative agency of the United States of America or the State of
Illinois (except in each case for such violations, breaches or defaults or
liens, charges or encumbrances that would not have a material adverse effect on
the ability of the Adviser to perform its obligations under the Management
Agreement and the Accounting Agreement) nor will such action result in any
violation of the provisions of the Organizational Documents of the Adviser.




                                      C-2

</TEXT>
</DOCUMENT>
