<DOCUMENT>
<TYPE>EX-99.2H.1
<SEQUENCE>4
<FILENAME>c72644a1exv99w2hw1.txt
<DESCRIPTION>FORM OF UNDERWRITING AGREEMENT
<TEXT>
<PAGE>
                                                                     EXHIBIT h.1


               Municipal Auction Rate Cumulative Preferred Shares

           NUVEEN INSURED CALIFORNIA TAX-FREE ADVANTAGE MUNICIPAL FUND

                             1,800 Shares, Series TH


                    Liquidation Preference $25,000 Per Share

                             UNDERWRITING AGREEMENT



                                                               January ___, 2003


SALOMON SMITH BARNEY INC.
NUVEEN INVESTMENTS, LLC
A.G. EDWARDS & SONS, INC.
PRUDENTIAL SECURITIES INCORPORATED

c/o      Salomon Smith Barney Inc.
         388 Greenwich Street
         New York, New York 10013


Ladies and Gentlemen:

                  Nuveen Insured California Tax-Free Advantage Municipal Fund, a
Massachusetts business trust (the "Fund"), proposes, upon the terms and
conditions set forth herein, to issue and sell an aggregate of 1,800 shares of
its Series TH Municipal Auction Rate Cumulative Preferred Shares (the
"MuniPreferred shares"), par value $.01 per share, with a liquidation preference
of $25,000 per share (the shares of MuniPreferred shares to be sold hereby are
referred to herein, collectively, as the "Shares"). The Shares will be
authorized by, and subject to the terms and conditions of, the Statement
Establishing and Fixing the Rights and Preferences of Municipal Auction Rate
Cumulative Preferred Shares (the "Statement") in the form filed as an exhibit to
the registration statement referred to in Section 1 of this Underwriting
Agreement (the "Agreement"). Nuveen Advisory Corp., a Delaware corporation (the
"Adviser"), is the Fund's investment adviser. This is to confirm the agreement
concerning the purchase of the Shares from the Fund by Salomon Smith Barney Inc.
(the "Representative"), Nuveen Investments, LLC, A.G. Edwards & Sons, Inc. and
Prudential Securities Incorporated (each, an "Underwriter", and together with
the Representative, the "Underwriters"). We understand that the Representative
has been duly authorized by each of the Underwriters to execute this Agreement
on behalf of such Underwriters and has been duly authorized to act hereunder on
behalf of each of the Underwriters.

                  The Fund has entered into an investment management agreement
with the Adviser dated November 14, 2003, a master custodian agreement with
State Street Bank & Trust





<PAGE>
                                                                               2


Company dated November 4, 2002, a transfer agency and service agreement with
State Street Bank & Trust Company dated October 7, 2002, and an auction agency
agreement, including the Basic Terms in respect thereof, with The Bank of New
York to be dated as of the Closing Date and substantially in the form as filed
with the Registration Statement. Such agreements are hereinafter referred to as
the "Investment Management Agreement", the "Custodian Agreement", the "Transfer
Agency Agreement" and the "Auction Agency Agreement", respectively, and are
hereinafter collectively referred to as the "Fund Agreements".

                  1. Registration Statement and Prospectus. The Fund has
prepared and filed with the Securities and Exchange Commission (the
"Commission"), in accordance with the provisions of the Securities Act of 1933,
as amended (the "1933 Act"), the Investment Company Act of 1940, as amended (the
"1940 Act"), and the rules and regulations of the Commission promulgated under
the 1933 Act (the "1933 Act Rules and Regulations") and the 1940 Act (the "1940
Act Rules and Regulations" and, together with the 1933 Act Rules and
Regulations, the "Rules and Regulations"), a registration statement on Form N-2
under the 1933 Act and the 1940 Act (the "registration statement"), including a
prospectus (including any statement of additional information) relating to the
Shares. The Fund also has filed a notification of registration of the Fund as an
investment company under the 1940 Act on Form N-8A (the "1940 Act
Notification"). The term "Registration Statement" as used in this Agreement
means the registration statement (including all financial schedules and
exhibits), as amended at the time it becomes effective under the 1933 Act, or,
if the registration statement became effective under the 1933 Act prior to the
execution of this Agreement, as amended or supplemented at the time it became
effective, prior to the execution of this Agreement, and includes any
information deemed to be included by Rule 430A under the 1933 Act Rules and
Regulations. If it is contemplated, at the time this Agreement is executed, that
a post-effective amendment to the registration statement will be filed under the
1933 Act and must be declared effective before the offering of the Shares may
commence, the term "Registration Statement" as used in this Agreement means the
registration statement as amended by said post-effective amendment. If the Fund
has filed an abbreviated registration statement to register an additional amount
of Shares pursuant to Rule 462(b) under the 1933 Act (the "Rule 462 Registration
Statement"), then any reference herein to the term "Registration Statement"
shall include such Rule 462 Registration Statement. The term "Prospectus" as
used in this Agreement means the prospectus and statement of additional
information in the forms included in the Registration Statement or, if the
prospectus or statement of additional information included in the Registration
Statement omits information in reliance on Rule 430A under the 1933 Act, all
references to the Prospectus shall be deemed to include, without limitation, the
prospectus, the statement of additional information and the term sheet, taken
together, provided to the Underwriters by the Fund in reliance on Rule 434 under
the 1933 Act and filed with the Commission pursuant to Rule 497(h) under the
1933 Act. The term "Prepricing Prospectus" as used in this Agreement means the
prospectus (including the statement of additional information) subject to
completion in the form included in the Registration Statement at the time of the
initial filing of the Registration Statement with the Commission and as such
prospectus (including the statement of additional information) shall have been
amended from time to time prior to the date of the Prospectus, together with any
other prospectus (including any other statement of additional information)
relating to the Fund other than the Prospectus approved in writing by or
directly or indirectly prepared by the Fund or the Adviser; it being understood
that the definition of Prepricing Prospectus above shall not include any



<PAGE>
                                                                               3


Prepricing Prospectus prepared by the Underwriters unless approved in writing by
the Fund or Adviser.

                  The Fund has furnished the Representative with copies of such
Registration Statement, each amendment to such Registration Statement filed with
the Commission and each Prepricing Prospectus.

                  2. Agreements to Sell and Purchase. The Fund hereby agrees,
subject to all the terms and conditions set forth herein, to issue and sell to
the Underwriters, and, upon the basis of the representations, warranties and
agreements of the Fund and the Adviser herein contained and subject to all the
terms and conditions set forth herein, each Underwriter agrees, severally and
not jointly, to purchase from the Fund, at a purchase price of $______ per
Share, the number of Series TH Shares set forth opposite the name of each such
Underwriter in Schedule I hereto.

                  3. Terms of Public Offering. The Fund and the Adviser have
been advised by the Underwriters that the Underwriters propose to make a public
offering of the Shares as soon after the Registration Statement and this
Agreement have become effective as in the Underwriters' judgment is advisable
and initially to offer the Shares upon the terms set forth in the Prospectus.

                  4. Delivery of the Shares and Payment Therefor. Delivery to
the Underwriters of and payment to the Fund for the Shares shall be made at the
office of Simpson Thacher & Bartlett, 425 Lexington Avenue, New York, NY 10017
or through the facilities of The Depository Trust Company ("DTC") or another
mutually agreeable facility at 9:30 A.M., New York City time, on January [ ],
2003 (the "Closing Date"). The place of closing for the Shares and the Closing
Date may be varied by agreement between the Representative and the Fund.

                  A certificate evidencing the Shares shall be delivered to and
registered at DTC, against payment of the purchase price therefor in immediately
available funds.

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

                  (a) If, at the time this Agreement is executed and delivered,
it is necessary for the Registration Statement or a post-effective amendment
thereto to be declared effective under the 1933 Act before the offering of the
Shares may commence, the Fund will use its reasonable best efforts to cause the
Registration Statement or such post-effective amendment to become effective
under the 1933 Act as soon as possible and will advise the Representative
promptly and, if requested by the Representative, will confirm such advice in
writing when the Registration Statement or such post-effective amendment has
become effective.

                  (b) The Fund will advise the Representative promptly and, if
requested by the Representative, will confirm such advice in writing: (i) of any
request made by the Commission for amendment of or a supplement to the
Registration Statement, any Prepricing Prospectus or the Prospectus (or any
amendment or supplement to any of the foregoing) or for additional information,
(ii) of the issuance by the Commission, the National Association of Securities
Dealers, Inc. (the "NASD"), any state securities commission, any national
securities exchange, any arbitrator, any court or any other governmental,
regulatory, self-regulatory or administrative agency or any official of any
order suspending the effectiveness of the Registration Statement,




<PAGE>
                                                                               4



prohibiting or suspending the use of the Prospectus, any Prepricing Prospectus
or any sales material (as hereinafter defined), of any notice pursuant to
Section 8(e) of the 1940 Act, of the suspension of qualification of the Shares
for offering or sale in any jurisdiction, or the initiation or contemplated
initiation of any proceeding for any such purposes, (iii) of receipt by the
Fund, the Adviser, any affiliate of the Fund or the Adviser or any
representative or attorney of the Fund or the Adviser of any other material
communication from the Commission, the NASD, any state securities commission,
any national securities exchange, any arbitrator, any court or any other
governmental, regulatory, self-regulatory or administrative agency or any
official relating to the Fund (if such communication relating to the Fund is
received by such person within three years after the date of this Agreement),
the Registration Statement, the 1940 Act Notification, the Prospectus, any
Prepricing Prospectus, any sales material (as hereinafter defined) (or any
amendment or supplement to any of the foregoing) or this Agreement or any of the
Fund Agreements and (iv) within the period of time referred to in paragraph (f)
below, of any material adverse change in the condition (financial or other),
business, prospects, properties, net assets or results of operations of the Fund
or the Adviser or of the happening of any other event which makes any statement
of a material fact made in the Registration Statement or the Prospectus or any
sales material (as hereinafter defined) (or any amendment or supplement to any
of the foregoing), untrue or which requires the making of any additions to or
changes in the Registration Statement, the Prospectus or any Prepricing
Prospectus or any sales material (as hereinafter defined) (or any amendment or
supplement to any of the foregoing) in order to state a material fact required
by the 1933 Act, the 1940 Act or the Rules and Regulations to be stated therein
or necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading or of the necessity to
amend or supplement the Registration Statement, the Prospectus, or any
Prepricing Prospectus or any sales material (as hereinafter defined) (or any
amendment or supplement to any of the foregoing) to comply with the 1933 Act,
the 1940 Act, the Rules and Regulations or any other law or order of any court
or regulatory body. If at any time the Commission, the NASD, any state
securities commission, any national securities exchange, any arbitrator, any
court or any other governmental, regulatory, self-regulatory or administrative
agency or any official shall issue any order suspending the effectiveness of the
Registration Statement, prohibiting or suspending the use of the Prospectus, any
Prepricing Prospectus or any sales material (as hereinafter defined) (or any
amendment or supplement to any of the foregoing) or suspending the qualification
of the Shares for offering or sale in any jurisdiction, the Fund will use its
reasonable best efforts to obtain the withdrawal of such order at the earliest
possible time.

                  (c) The Fund will furnish to the Representative, without
charge, three signed copies of the Registration Statement as originally filed
with the Commission and of each amendment thereto, including financial
statements and all exhibits thereto, and will also furnish to the
Representative, without charge, such number of conformed copies of the
Registration Statement as originally filed and of each amendment thereto, but
without exhibits, as the Representative may reasonably request.

                  (d) The Fund will not (i) file any amendment to the
Registration Statement or make any amendment or supplement to the Prospectus,
any Prepricing Prospectus or any sales material (as hereinafter defined) of
which the Representative shall not previously have been advised or to which the
Representative shall reasonably object after being so advised or (ii) so long
as, in the opinion of counsel for the Underwriters, a Prospectus is required by
the 1933 Act




<PAGE>
                                                                               5


to be delivered in connection with sales by any Underwriter or any dealer, file
any information, documents or reports pursuant to the Securities Exchange Act of
1934, as amended (the "1934 Act") or the 1940 Act, without delivering a copy of
such information, documents or reports to the Underwriters prior to or
concurrently with such filing.

                  (e) Prior to the execution and delivery of this Agreement, the
Fund has delivered to the Representative, without charge, in such quantities as
the Representative has reasonably requested, copies of each form of any
Prepricing Prospectus. The Fund consents to the use, in accordance with the
provisions of the 1933 Act and with the state securities or Blue Sky laws of the
jurisdictions in which the Shares are offered by the several Underwriters and by
dealers, prior to the date of the Prospectus, of each Prepricing Prospectus so
furnished by the Fund.

                  (f) As soon after the execution and delivery of this Agreement
as possible and thereafter from time to time for such period as in the opinion
of counsel for the Underwriters a Prospectus is required by the 1933 Act to be
delivered in connection with sales of Shares by the Underwriters or any dealer,
the Fund will expeditiously deliver to the Underwriters and each dealer, without
charge, as many copies of the Prospectus (and of any amendment or supplement
thereto) as the Representative may reasonably request. The Fund consents to the
use of the Prospectus (and of any amendment or supplement thereto) in accordance
with the provisions of the 1933 Act and with the state securities or Blue Sky
laws of the jurisdictions in which the Shares are offered by the Underwriters
and by all dealers to whom the Shares may be sold, both in connection with the
offering or sale of the Shares and for such period of time thereafter as the
Prospectus is required by the 1933 Act to be delivered in connection with sales
of the Shares by the Underwriters or any dealer. If during such period of time
any event shall occur that in the judgment of the Fund or in the opinion of
counsel for the Underwriters is required to be set forth in the Registration
Statement or the Prospectus (as then amended or supplemented) or should be set
forth therein in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if it is necessary
to supplement or amend the Registration Statement or the Prospectus to comply
with the 1933 Act, the 1940 Act, the Rules and Regulations or any other federal
law, rule or regulation, or any state securities or Blue Sky disclosure laws,
rules or regulations, the Fund will forthwith prepare and, subject to the
provisions of paragraph (d) above, promptly file with the Commission an
appropriate supplement or amendment thereto, and will promptly furnish to the
Underwriters and dealers, without charge, such number of copies thereof as they
shall reasonably request. In the event that the Registration Statement or the
Prospectus should be amended or supplemented, the Fund, if requested by the
Representative and to the extent consistent with applicable law, will promptly
issue a press release announcing or disclosing the matters to be covered by the
proposed amendment or supplement.

                  (g) The Fund will cooperate with the Representative and with
counsel for the Underwriters in connection with the registration or
qualification of the Shares for offering and sale by the Underwriters and by
dealers under the securities or Blue Sky laws of such jurisdictions as the
Representative may designate and will file such consents to service of process
or other documents necessary or appropriate in order to effect such registration
or qualification; provided that in no event shall the Fund be obligated to
qualify to do business in any jurisdiction where it is not now so qualified or
to take any action which would subject it to service of process




<PAGE>
                                                                               6


in suits, other than those arising out of the offering or sale of the Shares, in
any jurisdiction where it is not now so subject.

                  (h) The Fund will make generally available to its security
holders an earnings statement, which need not be audited, covering a
twelve-month period commencing after the effective date of the Registration
Statement and ending not later than 15 months thereafter, as soon as practicable
after the end of such period, which earnings statement shall satisfy the
provisions of Section 11(a) of the 1933 Act and Rule 158 of the 1933 Act Rules
and Regulations.

                  (i) The Fund will comply with the undertaking set forth in
paragraph 6 of Item 33 of Part C of the Registration Statement.

                  (j) During the period of five years hereafter, the Fund will
furnish to the Underwriters (i) as soon as available, a copy of each report of
the Fund mailed to stockholders or filed with the Commission or furnished to the
American Stock Exchange (the "AMEX") other than reports on Form N-SAR, and (ii)
from time to time such other information concerning the Fund as the
Representative may reasonably request.

                  (k) The Fund will direct the investment of the net proceeds
from the sale of the Shares in accordance with the description set forth in the
Prospectus and in such a manner as to comply with the investment objectives,
policies and restrictions of the Fund as described in the Prospectus.

                  (l) The Fund will file the requisite copies of the Prospectus
with the Commission in a timely fashion pursuant to Rule 497(c) or Rule 497(h)
of the 1933 Act Rules and Regulations, whichever is applicable or, if
applicable, will timely file the certification permitted by Rule 497(j) of the
1933 Act Rules and Regulations and will advise the Representative of the time
and manner of such filing.

                  (m) Except as provided in this Agreement, the Fund will not
sell, contract to sell, or otherwise dispose of any senior securities (as
defined in the 1940 Act) of the Fund or any securities convertible into or
exercisable or exchangeable for senior securities or grant any options or
warrants to purchase senior securities of the Fund for a period of 180 days
after the date of the Prospectus other than MuniPreferred shares, without the
prior written consent of the Representative.

                  (n) Except as stated in this Agreement and in the Prospectus,
neither the Fund nor the Adviser has taken, nor will it take, directly or
indirectly, any action designed to or that might reasonably be expected to cause
or result in stabilization or manipulation of the price of any securities issued
by the Fund to facilitate the sale or resale of the Shares.

                  (o) The Fund will use its reasonable best efforts to cause the
Shares, prior to the Closing Date, to be assigned a rating of 'Aaa' by Moody's
Investors Service ("Moody's") and 'AAA' by Standard & Poor's Investors Services,
a division of The McGraw-Hill Companies, Inc. ("S&P" and, together with Moody's,
the "Rating Agencies").



<PAGE>
                                                                               7


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

                  6. Representations and Warranties of the Fund and the Adviser.
The Fund and the Adviser, jointly and severally, represent and warrant to the
Underwriters that, as of the date hereof or at such other time or times
identified below:

                  (a) Each Prepricing Prospectus included as part of the
Registration Statement as originally filed or as part of any amendment or
supplement thereto, or filed pursuant to Rule 497 of the 1933 Act Rules and
Regulations, complied when so filed in all material respects with the provisions
of the 1933 Act, the 1940 Act and the Rules and Regulations. The Commission has
not issued any order preventing or suspending the use of any Prepricing
Prospectus.

                  (b) The Registration Statement in the form in which it became
or becomes effective and also in such form as it may be when any post-effective
amendment thereto shall become effective and the Prospectus and any supplement
or amendment thereto when filed with the Commission under Rule 497 of the 1933
Act Rules and Regulations and the 1940 Act Notification when originally filed
with the Commission and any amendment or supplement thereto when filed with the
Commission, complied or will comply in all material respects with the provisions
of the 1933 Act, the 1940 Act and the Rules and Regulations and did not or will
not at any such times contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein (in the case of the Prospectus, in the light of the
circumstances under which they were made) not misleading, except that this
representation and warranty does not apply to statements in or omissions from
the Registration Statement or the Prospectus (or any amendment or supplement
thereto) made in reliance upon and in conformity with information relating to
the Underwriters furnished to the Fund in writing by or on behalf of the
Underwriters expressly for use therein.

                  (c) All the outstanding shares of beneficial interest of the
Fund have been duly authorized and validly issued, are fully paid and
nonassessable and are free of any preemptive or similar rights, except that, as
set forth in the Registration Statement, shareholders of a Massachusetts
business trust may under certain circumstances be held personally liable for its
obligations; the Shares have been duly authorized and, when issued and delivered
to the Underwriters against payment therefor in accordance with the terms
hereof, will be validly issued, fully paid and nonassessable and free of any
preemptive or similar rights that entitle or will entitle any person to acquire
any Shares upon issuance thereof by the Fund, except as stated above, and will
conform to the description thereof in the Registration Statement and the
Prospectus (and any amendment or supplement to either of them); and the shares
of beneficial interest of the Fund conform to the description thereof in the
Registration Statement and the Prospectus (and any amendment or supplement to
either of them).

                  (d) The Fund has been duly established and is validly existing
and in good standing as a voluntary association (commonly referred to as a
"Massachusetts business trust") under the laws of the Commonwealth of
Massachusetts, 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




<PAGE>
                                                                               8


registered and qualified to conduct its business and is in good standing in each
jurisdiction or place where the nature of its properties or the conduct of its
business requires such registration or qualification except where the failure to
so register or to qualify does not have a material adverse effect on the
condition (financial or otherwise), business, properties, prospects, net assets
or results of operations of the Fund; and the Fund has no subsidiaries.

                  (e) There are no legal or governmental proceedings pending or,
to the knowledge of the Fund, threatened, against the Fund, or to which the Fund
or any of its properties is subject, that are required to be described in the
Registration Statement or the Prospectus (or any amendment or supplement to
either of them), but are not described as required by the 1933 Act, the 1940 Act
or the Rules and Regulations, and there are no agreements, contracts,
indentures, leases or other instruments that are required to be described in the
Registration Statement or the Prospectus (or any amendment or supplement to
either of them), or to be filed as an exhibit to the Registration Statement that
are not described or filed as required by the 1933 Act, the 1940 Act or the
Rules and Regulations.

                  (f) The Fund is not in violation of its Declaration of Trust,
as it may be amended (the "Declaration"), the Statement or by-laws (the
"By-Laws"), or other organizational documents (together, the "Organizational
Documents") of the Fund or of any material law, ordinance, administrative or
governmental rule or regulation applicable to the Fund or any material decree of
the Commission, the NASD, any state securities commission, any national
securities exchange, any arbitrator, any court or other governmental,
regulatory, self-regulatory or administrative agency, body or official having
jurisdiction over the Fund, or in breach or default in any material respect in
the performance of any obligation, agreement or condition contained in any
material bond, debenture, note or any other evidence of indebtedness or in any
material agreement, indenture, lease or other instrument to which the Fund is a
party or by which it or any of its properties may be bound.

                  (g) Neither the issuance and sale of the Shares, the
execution, delivery or performance of this Agreement nor any of the Fund
Agreements by the Fund nor the consummation by the Fund of the transactions
contemplated hereby or thereby (A) requires any consent, approval, authorization
or other order of or registration or filing with, the Commission, the NASD, any
state securities commission, any national securities exchange, any arbitrator,
any court, regulatory body, administrative agency or other governmental body,
agency or official (except such as may have been obtained or made prior to the
date hereof and such as may be required for compliance with the state securities
or Blue Sky laws of various jurisdictions and the filing of the Statement with
the Secretary of State of the Commonwealth of Massachusetts which have been or
will be effected in accordance with this Agreement) or conflicts or will
conflict with or constitutes or will constitute a breach of, or a default under,
the Organizational Documents of the Fund or (B) conflicts or will conflict with
or constitutes or will constitute a breach of, or a default under, any
agreement, indenture, lease or other instrument to which the Fund is a party or
by which it or any of its properties may be bound, or violates or will violate
any statute, law, regulation, filing, judgment, injunction, order or decree
applicable to the Fund or any of its properties, or will result in the creation
or imposition of any lien, charge or encumbrance upon any property or assets of
the Fund pursuant to the terms of any agreement or instrument to which it is a
party or by which it may be bound or to which any of its property or assets is
subject, except where such conflict, breach, default, violation, creation or
imposition





<PAGE>
                                                                               9


would not have a material adverse effect on the condition (financial or
otherwise), business, properties, prospects net assets or results of operations
of the Fund or on the ability of the Fund to perform its obligations under this
Agreement and the Fund Agreements. The Fund is not subject to any order of any
court or of any arbitrator, governmental authority or administrative agency,
except such orders which do not have a material adverse effect on the condition
(financial or otherwise), business, properties, prospects, net assets or results
of operations of the Fund or on the ability of the Fund to perform its
obligations under this Agreement and the Fund Agreements.

                  (h) Since the date as of which information is given in the
Registration Statement and the Prospectus (and any amendment or supplement to
either of them), except as otherwise stated therein, (A) there has been no
material, adverse change in the condition (financial or other), 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, and (B) there have been no transactions entered into by the Fund which
are material to the Fund other than those in the ordinary course of its
business.

                  (i) The accountants, Ernst & Young LLP, who have certified or
shall certify the statement of assets and liabilities and statement of
operations included or incorporated by reference in the Registration Statement
and the Prospectus (or any amendment or supplement to either of them), are an
independent public accounting firm as required by the 1933 Act, the 1940 Act and
the Rules and Regulations.

                  (j) The financial statements, together with related schedules
and notes, included or incorporated by reference in the Registration Statement
and the Prospectus (and any amendment or supplement to either of them), present
fairly the financial position, results of operations and changes in financial
position of the Fund on the basis stated or incorporated by reference in the
Registration Statement and the Prospectus at the respective dates or for the
respective periods to which they apply; such statements and related schedules
and notes have been prepared in accordance with generally accepted accounting
principles consistently applied throughout the periods involved, except as
disclosed therein; and the other financial and statistical information and data
included in the Registration Statement and the Prospectus (and any amendment or
supplement thereto), are accurately derived from such financial statements and
the books and records of the Fund.

                  (k) 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 and thereunder may be limited by federal or state securities laws and
subject to the qualification that the enforceability of the Fund's obligations
hereunder and thereunder may be limited to bankruptcy, insolvency,
reorganization, moratorium and other laws relating to or affecting creditors'
rights generally and by general equitable principles.




<PAGE>
                                                                              10


                  (l) Except as disclosed in the Registration Statement and the
Prospectus (or any amendment or supplement to either of them), subsequent to the
respective dates as of which such information is given in the Registration
Statement and the Prospectus (or any amendment or supplement to either of them),
the Fund has not incurred any liability or obligation, direct or contingent, or
entered into any transaction, not in the ordinary course of business, that is
material to the Fund, and there has not been any change in the shares of
beneficial interest, or material increase in the short-term debt or long-term
debt, of the Fund, or any material adverse change, or any development involving
or which would reasonably be expected to involve, a prospective material adverse
change in the condition (financial or other), business, prospects, properties,
net assets or results of operations of the Fund, whether or not arising in the
ordinary course of business.

                  (m) The Fund has filed all tax returns required to be filed,
which returns are complete and correct in all material respects, and the Fund is
not in material default in the payment of any taxes which were payable pursuant
to said returns or any assessments with respect thereto.

                  (n) The Fund is registered under the 1940 Act as a closed-end
non-diversified management investment company, and the 1940 Act Notification has
been duly filed with the Commission and, at the time of filing thereof and any
amendment or supplement thereto, conformed in all material respects with all
applicable provisions of the 1940 Act and the Rules and Regulations. The Fund
is, and at all times through the completion of the transactions contemplated
hereby, will be, in compliance in all material respects with the terms and
conditions of the 1933 Act and the 1940 Act. No person is serving or acting as
an officer, director or investment adviser of the Fund except in accordance with
the provisions of the 1940 Act and the 1940 Act Rules and Regulations and the
Investment Advisers Act of 1940, as amended (the "Advisers Act"), and the rules
and regulations of the Commission promulgated under the Advisers Act (the
"Advisers Act Rules and Regulations").

                  (o) As required by Subchapter M of the Internal Revenue Code
of 1986, as amended (the "Code"), the Fund is currently in compliance with the
requirements to qualify as a regulated investment company under the Code.

                  (p) The Fund's Common Shares (as defined in the Prospectus)
are duly listed on the AMEX.

                  (q) The Fund has not distributed and, prior to the later to
occur of (i) the Closing Date and (ii) completion of the distribution of the
Shares, will not distribute to the public any offering material in connection
with the offering and sale of the Shares other than the Registration Statement,
any Prepricing Prospectus, the Prospectus or other materials, if any, permitted
by the 1933 Act, the 1940 Act or the Rules and Regulations.

                  (r) The Fund has such licenses, permits, and authorizations of
governmental or regulatory authorities ("permits") as are necessary to own its
property and to conduct its business in the manner described in the Prospectus
(and any amendment or supplement thereto); 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




<PAGE>
                                                                              11


termination thereof or results in any other material impairment of the rights of
the Fund under any such permit, subject in each case to such qualification as
may be set forth in the Prospectus (and any amendment or supplement thereto);
and, except as described in the Prospectus (and any amendment or supplement
thereto), none of such permits contains any restriction that is materially
burdensome to the Fund.

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

                  (t) No holder of any security of the Fund has any right to
require registration of shares of beneficial interest, MuniPreferred shares or
any other security of the Fund because of the filing of the Registration
Statement or consummation of the transactions contemplated by this Agreement.

                  (u) 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.

                  (v) Except as stated in this Agreement and in the Prospectus
(and any amendment or supplement thereto), the Fund has not taken, nor will it
take, directly or indirectly, any action designed to or which would reasonably
be expected to cause or result in stabilization or manipulation of the price of
any securities issued by the Fund to facilitate the sale or resale of the
Shares, and the Fund is not aware of any such action taken or to be taken by any
affiliates of the Fund.

                  (w) The Fund has filed in a timely manner each document or
report required to be filed by it pursuant to the 1940 Act, the 1940 Act Rules
and Regulations, the 1934 Act and the rules and regulations of the Commission
promulgated thereunder (the "1934 Act Rules and Regulations"); each such
document or report at the time it was filed conformed in all material respects
with all applicable requirements of the 1934 Act and the 1934 Act Rules and
Regulations; and none of such documents or reports contained an untrue statement
of any material fact or omitted to state any material fact required to be stated
therein, in the light of the circumstances under which they were made, not
misleading. The Fund has not received any notice from the Commission pursuant to
Section 8(e) of the 1940 Act with respect to the 1940 Act Notification or the
Registration Statement (or any amendment or supplement to either of them).



<PAGE>
                                                                              12


                  (x) All advertising, sales literature or other promotional
material (including "prospectus wrappers," "broker kits," "road show slides" and
"road show scripts") authorized in writing by or prepared by the Fund or the
Adviser for use in connection with the offering and sale of the Shares
(collectively, "sales material") complied and comply in all material respects,
to the Fund's and Adviser's best knowledge, with the applicable requirements of
the 1933 Act, the 1940 Act, the 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, all sales material were so filed, and no such sales
material contained or contains an untrue statement of a material fact or omitted
or omits to state a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading.

                  (y) 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.

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

                  7. Representations and Warranties of the Adviser. The Adviser
represents and warrants to each Underwriter that, as of the date hereof or at
such other time or times identified below:

                  (a) The Adviser is a corporation duly organized and validly
existing in good standing under the laws of its jurisdiction of incorporation,
with full corporate power and authority to own, lease and operate its properties
and to conduct its business as described in the Registration Statement and the
Prospectus (and any amendment or supplement to either of them), and is duly
registered and qualified to conduct its business and is in good standing in each
jurisdiction or place where the nature of its properties or the conduct of its
business requires such registration or qualification except where the failure so
to register or to qualify would not have a material adverse effect on the
condition (financial or other), business, prospects, properties, net assets or
results of operations of such Adviser.

                  (b) 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; 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.

                  (c) The Adviser is duly registered with the Commission as an
investment adviser under the Advisers Act and is not prohibited by the Advisers
Act, the Advisers Act Rules and Regulations, the 1940 Act or the 1940 Act Rules
and Regulations from acting under the Investment Management Agreement or the
Sub-Advisory Agreement for the Fund as contemplated by the Prospectus (or any
amendment or supplement thereto). There does not exist any proceeding, to the
best of the Adviser's knowledge after reasonable investigation, or any facts or
circumstances the existence of which could lead to any proceeding which would



<PAGE>
                                                                              13


reasonably be expected to adversely affect the registration of the Adviser as an
investment adviser with the Commission.

                  (d) There are no legal or governmental proceedings pending or,
to the knowledge of the Adviser, threatened against the Adviser, or to which the
Adviser or any of its properties is subject, that are required to be described
in the Registration Statement or the Prospectus (or any amendment or supplement
to either of them), but are not described as required or that would reasonably
be expected to involve a prospective material adverse change in the condition
(financial or other), business, prospects, properties, assets or results of
operations of the Adviser or on the ability of the Adviser to perform its
obligations under this Agreement or under the Fund Agreements to which it is a
party.

                  (e) The Adviser is not in violation of its corporate charter
or by-laws, or other organizational documents, in default under any material
agreement, indenture or instrument or in breach or violation of any judgment,
decree, order, rule or regulation of any court or governmental or
self-regulatory agency or body except where such violation would not have a
material adverse effect on the condition (financial or other), business,
prospects, properties, net assets or results of operations of such Adviser or on
the ability of the Adviser to perform its obligations under this Agreement or
under the Fund Agreements to which it is a party.

                  (f) Neither the execution, delivery or performance of this
Agreement or the Fund Agreements to which it is a party by the Adviser, nor the
consummation by the Adviser of the transactions contemplated hereby or thereby
(A) requires the Adviser to obtain any consent, approval, authorization or other
order of or registration or filing with, the Commission, the NASD, any state
securities commission, any national securities exchange, any arbitrator, any
court, regulatory body, administrative agency or other governmental body, agency
or official (except such as may have been obtained or made prior to the date
hereof) or conflicts or will conflict with or constitutes or will constitute a
breach of or a default under, the corporate charter or by-laws, or other
organizational documents, of the Adviser, except where the failure to obtain
such consent, approval, authorization or other order of, or make such
registration or filing, or such conflict, breach or default would not have a
material adverse effect on the condition (financial or otherwise), business,
prospects, properties, net assets or result of operations of the Adviser or on
the ability of the Adviser to perform its obligations under this Agreement and
the Fund Agreements to which it is a party or (B) conflicts or will conflict
with or constitutes or will constitute a breach of or a default under, any
agreement, indenture, lease or other instrument to which the Adviser is a party
or by which it or any of its properties may be bound, or violates or will
violate any statute, law, regulation or filing or judgment, injunction, order or
decree applicable to the Adviser or any of its properties or will result in the
creation or imposition of any lien, charge or encumbrance upon any property or
assets of the Adviser pursuant to the terms of any agreement or instrument to
which it is a party or by which it may be bound or to which any of the property
or assets of the Adviser is subject, except where such conflict, breach, default
or violation would not have a material adverse effect on the condition
(financial or otherwise), prospects, business, properties, net assets or results
of operations of the Adviser or on the ability of the Adviser to perform its
obligations under this Agreement and the Fund Agreements to which it is a party.
The Adviser is not subject to any order of any court or of any arbitrator,
governmental authority or administrative agency, except such orders which do not
have a material adverse effect on the condition (financial or otherwise),
business, prospects, properties,



<PAGE>
                                                                              14


net assets or results of operations of the Adviser or on the ability of the
Adviser to perform its obligations under this Agreement and the Fund Agreements
to which it is a party.

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

                  (h) The Adviser has the financial resources available to it
necessary for the performance of its services and obligations as contemplated in
the Prospectus (or any amendment or supplement thereto) and under this Agreement
and the Fund Agreements to which it is a party.

                  (i) The description of the Adviser, its business and the
statements attributable to the Adviser in the Registration Statement and the
Prospectus (and any amendment or supplement thereto) complied and comply in all
material respects with the provisions of the 1933 Act, the 1940 Act, the
Advisers Act, the Rules and Regulations and the Advisers Act Rules and
Regulations and did not and will not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading.

                  (j) Except as disclosed in the Registration Statement and the
Prospectus (or any amendment or supplement to either of them), subsequent to the
respective dates as of which such information is given in the Registration
Statement and the Prospectus (or any amendment or supplement to either of them),
the Adviser has not incurred any liability or obligation, direct or contingent,
or entered into any transaction, not in the ordinary course of business, that is
material to the Adviser or the Fund and that is required to be disclosed by the
1933 Act, the 1940 Act or the Rules and Regulations in the Registration
Statement or the Prospectus and there has not been any material adverse change,
or any development involving or which would reasonably be expected to involve, a
prospective material adverse change, in the condition (financial or other),
business, prospects, properties, assets or results of operations of the Adviser,
whether or not arising in the ordinary course of business, or which, in each
case, could have a material adverse effect on the ability of the Adviser to
perform its obligations under this Agreement and the Fund Agreements to which it
is a party.

                  (k) 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 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





<PAGE>
                                                                              15


designed to effectively prohibit access to such promotional materials by persons
other than qualified broker-dealers and registered representatives thereof.

                  8. Indemnification and Contribution.

                  (a) The Fund and the Adviser, jointly and severally, agree to
indemnify and hold harmless each of the Underwriters and each person, if any,
who controls the Underwriters within the meaning of Section 15 of the 1933 Act
or Section 20 of the 1934 Act from and against any and all losses, claims,
damages, liabilities and expenses, (including reasonable costs of
investigation), joint or several, arising out of or based upon any untrue
statement or alleged untrue statement of a material fact contained in any
Prepricing Prospectus or in the Registration Statement or the Prospectus or any
sales material or in any amendment or supplement thereto, or arising out of or
based upon any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading,
except insofar as such losses, claims, damages, liabilities or expenses arise
out of or are based upon any untrue statement or omission or alleged untrue
statement or omission which has been made therein or omitted therefrom in
reliance upon and in conformity with the information relating to the
Underwriters furnished in writing to the Fund by or on behalf of the
Underwriters expressly for use in connection therewith; provided, however, that
the indemnification contained in this paragraph (a) with respect to the
Registration Statement, the Prospectus or any Prepricing Prospectus (or any
amendment or supplement to any of the foregoing) shall not inure to the benefit
of the Underwriters (or to the benefit of any person controlling the
Underwriters) on account of any such loss, claim, damage, liability or expense
arising from the sale of the Shares by the Underwriters to any person if it is
shown that a copy of the Prospectus, as then amended or supplemented, was not
delivered or sent to such person by or on behalf of the Underwriters within the
time required by the 1933 Act and the 1933 Act Rules and Regulations, and the
untrue statement or alleged untrue statement or omission or alleged omission of
a material fact was corrected in the Prospectus, provided that the Fund has
delivered the Prospectus to the Underwriters in the requisite quantity and on a
timely basis to permit such delivery or sending. The foregoing indemnity
agreement shall be in addition to any liability which the Fund or the Adviser
may otherwise have.

                  (b) If any action, suit or proceeding shall be brought against
the Underwriters or any person controlling any Underwriter in respect of which
indemnity may be sought against the Fund or the Adviser, the Underwriters or
such controlling person shall promptly notify the Fund or the Adviser, and the
Fund or the Adviser shall assume the defense thereof, including the employment
of counsel and payment of all fees and expenses. The Underwriters or any such
controlling person shall have the right to employ separate counsel in any such
action, suit or proceeding and to participate in the defense thereof, but the
fees and expenses of such counsel shall be at the expense of the Underwriters or
such controlling person unless (i) the Fund or the Adviser has agreed in writing
to pay such fees and expenses, (ii) the Fund and the Adviser have failed within
a reasonable time to assume the defense and employ counsel, or (iii) the named
parties to any such action, suit or proceeding (including any impleaded parties)
include both the Underwriters or such controlling person and the Fund or the
Adviser and the Underwriters or such controlling person shall have been advised
by its counsel that representation of such indemnified party and the Fund or the
Adviser by the same counsel would be inappropriate under





<PAGE>
                                                                              16


applicable standards of professional conduct (whether or not such representation
by the same counsel has been proposed) due to actual or potential differing
interests between them (in which case the Fund and the Adviser shall not have
the right to assume the defense of such action, suit or proceeding on behalf of
the Underwriters or such controlling person). It is understood, however, that
the Fund and the Adviser shall, in connection with any one such action, suit or
proceeding or separate but substantially similar or related actions, suits or
proceedings in the same jurisdiction arising out of the same general allegations
or circumstances, be liable for the reasonable fees and expenses of only one
separate firm of attorneys (in addition to any local counsel if there is any
action, suit or proceeding in more than one jurisdiction) at any time for the
Underwriters and controlling persons not having actual or potential differing
interests with you or among themselves, which firm shall be designated in
writing by the Representative, and that all such fees and expenses shall be
reimbursed promptly as they are incurred. The Fund and the Adviser shall not be
liable for any settlement of any such action, suit or proceeding effected
without its written consent, but if settled with such written consent, or if
there be a final judgment for the plaintiff in any such action, suit or
proceeding, the Fund and the Adviser agree to indemnify and hold harmless the
Underwriters, to the extent provided in the preceding paragraph, and any such
controlling person from and against any loss, claim, damage, liability or
expense by reason of such settlement or judgment.

                  (c) The Underwriters agree, severally and not jointly, to
indemnify and hold harmless the Fund and the Adviser, their trustees, directors,
any officers who sign the Registration Statement, and any person who controls
the Fund or the Adviser within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act, to the same extent as the foregoing indemnity from
the Fund and the Adviser to the Underwriters, but only with respect to
information relating to the Underwriters furnished in writing by or on behalf of
the Underwriters expressly for use in the Registration Statement, the Prospectus
or any Prepricing Prospectus, or any amendment or supplement thereto. If any
action, suit or proceeding shall be brought against the Fund or the Adviser, any
of their trustees, directors, any such officer, or any such controlling person
based on the Registration Statement, the Prospectus or any Prepricing
Prospectus, or any amendment or supplement thereto, and in respect of which
indemnity may be sought against the Underwriters pursuant to this paragraph (c),
the Underwriters shall have the rights and duties given to the Fund and the
Adviser by paragraph (b) above (except that if the Fund or the Adviser shall
have assumed the defense thereof the Underwriters shall not be required to do
so, but may employ separate counsel therein and participate in the defense
thereof, but the fees and expenses of such counsel shall be at the Underwriters'
expense), and the Fund and the Adviser, their directors, any such officer, and
any such controlling person shall have the rights and duties given to the
Underwriters by paragraph (b) above. The foregoing indemnity agreement shall be
in addition to any liability which the Underwriters may otherwise have.

                  (d) If the indemnification provided for in this Section 8 is
unavailable to an indemnified party under paragraphs (a) or (c) hereof in
respect of any losses, claims, damages, liabilities or expenses referred to
therein, then an indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such indemnified party
as a result of such losses, claims, damages, liabilities or expenses (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Fund and the Adviser on the one hand (treated jointly for this purpose as one
person) and the Underwriters on the other hand from the offering of the Shares,
or (ii) if the allocation provided by clause (i) above is not permitted by




<PAGE>
                                                                              17


applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Fund and the Adviser on the one hand (treated jointly for this purpose as
one person) and the Underwriters on the other in connection with the statements
or omissions that resulted in such losses, claims, damages, liabilities or
expenses, as well as any other relevant equitable considerations. The relative
benefits received by the Fund and the Adviser on the one hand (treated jointly
for this purpose as one person) and the Underwriters on the other shall be
deemed to be in the same proportion as the total net proceeds from the offering
(before deducting expenses) received by the Fund bear to the total sales load
received by the Underwriters, in each case as set forth in the table on the
cover page of the Prospectus. The relative fault of the Fund and the Adviser on
the one hand (treated jointly for this purpose as one person) and the
Underwriters on the other hand shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Fund and the Adviser on the one hand (treated jointly for this
purpose as one person) or by the Underwriters on the other hand and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.

                  (e) The Fund, the Adviser and the Underwriters agree that it
would not be just and equitable if contribution pursuant to this Section 8 were
determined by a pro rata allocation or by any other method of allocation that
does not take account of the equitable considerations referred to in paragraph
(d) above. The amount paid or payable by an indemnified party as a result of the
losses, claims, damages, liabilities and expenses referred to in paragraph (d)
above shall be deemed to include, subject to the limitations set forth above,
any legal or other expenses reasonably incurred by such indemnified party in
connection with investigating any claim or defending any such action, suit or
proceeding. Notwithstanding the provisions of this Section 8, the Underwriters
shall not be required to contribute any amount in excess of the amount by which
the total price of the Shares underwritten by it and distributed to the public
exceeds the amount of any damages which the Underwriters have otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution
from any person who was not guilty of such fraudulent misrepresentation. The
Underwriters' obligations to contribute pursuant to this Section 8 are several
in proportion to the respective number of Shares set forth opposite their names
in Schedule I and not joint.

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

                  (g) Any losses, claims, damages, liabilities or expenses for
which an indemnified party is entitled to indemnification or contribution under
this Section 8 shall be paid by the indemnifying party to the indemnified party
as such losses, claims, damages, liabilities or expenses are incurred. The
indemnity and contribution agreements contained in this Section 8 and the
representations and warranties of the Fund and the Adviser set forth in this
Agreement





<PAGE>
                                                                              18


shall remain operative and in full force and effect, regardless of (i) any
investigation made by or on behalf of the Underwriters or any person controlling
the Underwriters, the Fund, the Adviser, their trustees, directors or officers,
or any person controlling the Fund or the Adviser, (ii) acceptance of any Shares
and payment therefor hereunder, and (iii) any termination of this Agreement. A
successor to the Underwriters or any person controlling any Underwriter, or to
the Fund, the Adviser, their trustees, directors or officers, or any person
controlling the Fund or the Adviser, shall be entitled to the benefits of the
indemnity, contribution, and reimbursement agreements contained in this Section
8.

                  (h) Any indemnification by the Fund shall be subject to the
requirements and limitations of Section 17(i) of the 1940 Act.

                  9. Conditions of Underwriters' Obligations. The several
obligations of the Underwriters to purchase any Shares hereunder are subject to,
in the good faith judgment of the Underwriters, the accuracy of and compliance
with the representations, warranties and agreements of and by the Fund and the
Adviser contained herein on and as of the date hereof, the date on which the
Registration Statement becomes or became effective, the date of the Prospectus
(and of any amendment or supplement thereto) and the Closing Date; to the
accuracy and completeness of all statements made by the Fund, the Adviser or any
of their officers in any certificate delivered to the Underwriters or their
counsel pursuant to this Agreement and to the following conditions:

                  (a) If, at the time this Agreement is executed and delivered,
it is necessary for the Registration Statement or a post-effective amendment
thereto to be declared effective before the offering of the Shares may commence,
the Registration Statement or such post-effective amendment shall have become
effective not later than 5:30 P.M., New York City time, on the date hereof, or
at such later date and time as shall be consented to in writing by the
Underwriters, and all filings, if any, required by Rules 497 and 430A under the
1933 Act and the 1933 Act Rules and Regulations shall have been timely made; no
stop order suspending the effectiveness of the Registration Statement or order
pursuant to Section 8(e) of the 1940 Act shall have been issued and no
proceeding for those purposes shall have been instituted or, to the knowledge of
the Fund, the Adviser or the Underwriters, threatened by the Commission, and any
request of the Commission for additional information (to be included in the
Registration Statement or the Prospectus or otherwise) shall have been complied
with to the Underwriters' satisfaction.

                  (b) Subsequent to the effective date of this Agreement, there
shall not have occurred (i) any change or any development involving a
prospective change in or affecting the condition (financial or other), business,
prospects, properties, net assets, or results of operations of the Fund or the
Adviser not contemplated by the Prospectus, which in the Underwriters' opinion
would materially and adversely affect the market for the Shares, or (ii) any
event or development relating to or involving the Fund or the Adviser or any
officer, trustee or director of the Fund or the Adviser which makes any
statement of a material fact made in the Prospectus untrue or which, in the
opinion of the Fund and its counsel or the Underwriters and their counsel,
requires the making of any addition to or change in the Prospectus in order to
state a material fact required by the 1933 Act, the 1940 Act or the Rules and
Regulations or any other law to be stated therein or necessary in order to make
the statements therein, in the light of the circumstances under which they were
made, not misleading, if amending or supplementing the





<PAGE>
                                                                              19


Prospectus to reflect such event or development would, in the Underwriters'
opinion, materially adversely affect the market for the Shares.

                  (c) The Fund shall have furnished to the Representative as
soon as practicable from the Closing Date a report showing compliance with the
asset coverage requirements of the 1940 Act and a Basic Maintenance Report (as
defined in the Statement), in form and substance reasonably satisfactory to the
Representative.

                  (d) Vedder, Price, Kaufman & Kammholz, counsel to the Fund,
shall have furnished to the Representative on the Closing Date its opinion
addressed to the Underwriters and dated the Closing Date, to the effect that:

                           (i) The Fund is (A) duly established and validly
                  existing under the Fund's Declaration and the laws of the
                  Commonwealth of Massachusetts as a voluntary association with
                  transferable shares of beneficial interest, commonly referred
                  to as a "Massachusetts business trust," (B) is in good
                  standing with the Secretary of the Commonwealth of
                  Massachusetts, (C) has full power and authority as a business
                  trust, to own, lease and operate its properties and to conduct
                  its business, in each case as described in the Registration
                  Statement and the Prospectus (and any amendment or supplement
                  to either of them through the date of the opinion);

                           (ii) The Shares have been duly authorized by the Fund
                  for issuance and sale to the Underwriters pursuant to the
                  Underwriting Agreement and, when issued and delivered to the
                  Underwriters against payment therefor in accordance with the
                  terms of the Underwriting Agreement, will be validly issued,
                  fully paid and nonassessable, except that, as set forth in the
                  Registration Statement, shareholders of a Massachusetts
                  business trust may under certain circumstances be held liable
                  for its obligations, and are free of any statutory preemptive
                  rights. Except as set forth in the Declaration and the
                  Statement, there are no restrictions upon the transfer of any
                  Shares pursuant to the Declaration or By-Laws of the Fund or,
                  to the best knowledge of such counsel, any agreement or other
                  outstanding instrument to which the Fund is a party. The form
                  of certificate evidencing the Shares complies as to form with
                  all requirements of Massachusetts law;

                           (iii) The description of the authorized shares of
                  beneficial interest of the Fund contained under the caption
                  "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. The statements in the
                  first two paragraphs under the caption "Certain Provisions in
                  the Declaration of Trust" in the Prospectus, to the extent
                  that they constitute descriptions of Massachusetts law, are in
                  summary form accurate in all material respects. The
                  description of the Shares contained under the captions
                  "Description of MuniPreferred Shares" and "The Auction" in the
                  Prospectus conforms in all material respects as to legal
                  matters to the terms thereof contained in the Fund's
                  Declaration and Statement;



<PAGE>
                                                                              20


                           (iv) All of the outstanding shares of the Fund have
                  been duly authorized by the Fund and validly issued, are fully
                  paid and nonassessable, except that, as set forth in the
                  Registration Statement, shareholders of a Massachusetts
                  business trust may under certain circumstances be held liable
                  for its obligations, and are free of any statutory preemptive
                  rights;

                           (v) 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 such counsel's
                  knowledge, no proceeding for any such purpose has been
                  instituted or is pending or threatened in writing by the
                  Commission;

                           (vi) The Fund's notification of registration as an
                  investment company under the 1940 Act on Form N-8A (the "1940
                  Act Notification"), 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) complies as to form in all material respects with
                  the requirements of the 1933 Act, the 1940 Act and the Rules
                  and Regulations;

                           (vii) The statements made in the Prospectus under the
                  captions "The Auction," "Description of MuniPreferred Shares"
                  and "Additional Information Concerning The Auctions for
                  MuniPreferred Shares," insofar as they purport to summarize
                  the provisions of the Statement or other documents or
                  agreements specifically referred to therein, constitute
                  accurate summaries of the terms of the Statement or such other
                  documents, in all material respects;

                           (viii) The statements made in the Prospectus under
                  the captions "Prospectus Summary -- Taxation" and "Tax Matters
                  -- Federal Income Tax Matters", insofar as they constitute
                  matters of law or legal conclusions, have been reviewed by
                  such counsel and constitute accurate statements of any such
                  matters of law or legal conclusions, and fairly present the
                  information called for with respect thereto by Form N-2, in
                  all material respects;

                           (ix) To the best of such counsel's 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;

                           (x) The Underwriting Agreement and the Fund
                  Agreements have each been duly and validly authorized,
                  executed and delivered by the Fund, each complies with all
                  applicable provisions of the 1940 Act and the 1940 Act Rules
                  and Regulations and the Advisers Act and the rules and
                  regulations thereunder,




<PAGE>
                                                                              21


                  and each constitutes the valid and binding agreement of the
                  Fund, enforceable against the Fund in accordance with its
                  terms;

                           (xi) The Fund is registered under the 1940 Act as a
                  closed-end non-diversified management investment company; the
                  provisions of the Declaration, Statement and By-Laws of the
                  Fund and the investment policies and restrictions described in
                  the Prospectus do not violate the requirements of the 1940 Act
                  in any material respect;

                           (xii) 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, State
                  of Illinois or the Commonwealth of Massachusetts (except (1)
                  any, the absence of which, either individually or in the
                  aggregate, would not have a material adverse effect on the
                  Fund; (2) such as may have been obtained prior to the date
                  hereof; and (3) such as may be required for compliance with
                  the AMEX or state securities or Blue Sky laws of various
                  jurisdictions in accordance with the Underwriting Agreement)
                  or violates or will violate or constitutes or will constitute
                  a breach of any of the provisions of the Organizational
                  Documents of the Fund or (B) 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 such counsel to which the Fund is party or
                  by which it or any of its properties may be bound, or violates
                  any material United States, State of Illinois or the
                  Commonwealth of Massachusetts statute, law, regulation
                  (assuming compliance with all applicable state securities and
                  Blue Sky laws), 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 known to
                  such counsel to which the Fund is a party or by which any of
                  its property or assets is bound. To the best of such counsel's
                  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, the State of Illinois
                  or the Commonwealth of Massachusetts;

                           (xiii) No holder of any security of the Fund has any
                  right pursuant to any agreement known to such counsel to which
                  the Fund is a party to require registration of shares of
                  beneficial interest, MuniPreferred shares or any other
                  security of the Fund because of the filing of the Registration
                  Statement or consummation of the transactions contemplated by
                  the Underwriting Agreement;

                           (xiv) To the best of such counsel's knowledge, there
                  are no agreements, contracts, indentures, leases or other
                  instruments that are required to be described




<PAGE>
                                                                              22


                  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

                           (xv) Such counsel shall state that it has
                  participated in conferences with officers and employees of the
                  Fund and the Adviser, representatives of the independent
                  accountants for the Fund, Massachusetts 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 it is not passing
                  upon, and does 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 (iii), (vii)
                  and (viii) above, and has made no independent check or
                  verification thereof, on the basis of the foregoing, no facts
                  have come to its attention that would have led it to believe
                  that (A) the Registration Statement, at the time it became
                  effective, contained an untrue statement of a material fact or
                  omitted to state any material fact required to be stated
                  therein or necessary to make the statements contained therein
                  not misleading, (B) the Prospectus, as of its date contained
                  or as of the Closing Date contains, an untrue statement of a
                  material fact or omitted or omits to state a material fact
                  required to be stated therein or necessary to make the
                  statements contained therein, in the light of the
                  circumstances under which they were made, not misleading, or
                  (C) the 1940 Act Notification as of its date 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 it expresses no opinion 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.

                  In giving such opinion, Vedder, Price, Kaufman & Kammholz may
rely on the opinion of Bingham McCutchen LLP as to matters of Massachusetts law,
provided that Vedder, Price, Kaufman & Kammholz furnish a copy thereof to the
Underwriters and state that such opinion is satisfactory in substance and form
and that the Underwriters and counsel for the Underwriters are entitled to rely
thereon.

                  (e) Gifford R. Zimmerman, Esq., Managing Director, Assistant
Secretary and General Counsel for the Adviser, shall have furnished to the
Representative on the Closing Date his opinion addressed to the Underwriters and
dated the Closing Date, to the effect that:

                           (i) The Adviser has been duly organized and is
                  validly existing and in good standing as a corporation under
                  the laws of the State of Delaware, with full corporate power
                  and authority to own, lease and operate its properties and to
                  conduct its business as described in the Registration
                  Statement and the Prospectus (and any amendment or supplement
                  to either of them), and is duly registered and qualified to
                  conduct its business and is in good standing in each
                  jurisdiction or place where the nature of its properties or
                  the conduct of its business requires such registration or
                  qualification, except where the failure so to register or to
                  qualify



<PAGE>
                                                                              23


                  does not have a material, adverse effect on the condition
                  (financial or other), business, properties, prospects, net
                  assets or results of operations of the Adviser;

                           (ii) The Adviser is duly registered and in good
                  standing with the Commission as an investment adviser under
                  the Advisers Act and is not prohibited by the Advisers Act,
                  the Advisers Act Rules and Regulations, the 1940 Act or the
                  1940 Act Rules and Regulations from acting under the
                  Investment Management Agreement for the Fund as contemplated
                  by the Prospectus (or any amendment or supplement thereto);
                  there does not exist any proceeding or, to the best of such
                  counsel's knowledge after reasonable investigation, any facts
                  or circumstances the existence of which could lead to any
                  proceeding which would materially and adversely affect the
                  registration of the Adviser with the Commission;

                           (iii) To the best of such counsel's knowledge, there
                  are no legal or governmental proceedings pending or threatened
                  against the Adviser, or to which the Adviser or any of its
                  properties is subject, that are required to be described in
                  the Registration Statement or the Prospectus (or any amendment
                  or supplement to either of them), but are not described as
                  required or that would reasonably be expected to involve a
                  prospective material adverse change, in the condition
                  (financial or other), business, prospects, properties, assets
                  or results of operations of the Adviser or on the ability of
                  the Adviser to perform its obligations under the Underwriting
                  Agreement and the Investment Management Agreement;

                           (iv) To the best of such counsel's knowledge, the
                  Adviser is not in violation of its corporate charter or
                  by-laws or other organizational documents, nor is the Adviser
                  in default under any material agreement, indenture or
                  instrument or in breach or violation of any judgment, decree,
                  order, rule or regulation of any court or governmental or
                  self-regulatory agency or body;

                           (v) The Adviser has corporate power and authority to
                  enter into this Agreement and the Investment Management
                  Agreement and this Agreement have each been duly and validly
                  authorized, executed and delivered by the Adviser, each
                  complies with all applicable provisions of the 1940 Act and
                  the Advisers Act and the 1940 Act Rules and Regulations and
                  the Advisers Act Rules and Regulations and each constitutes
                  the valid and legally binding agreement of the Adviser,
                  enforceable against the Adviser in accordance with its terms,
                  subject as to enforcement to bankruptcy, insolvency,
                  reorganization and other laws of general applicability
                  relating to or affecting creditors' rights and to general
                  equity principles;

                           (vi) The description of the Adviser in the
                  Registration Statement and the Prospectus (and any amendment
                  or supplement thereto) complies in all material respects with
                  the provisions of the 1933 Act, the 1940 Act, the Advisers
                  Act, the Rules and Regulations and the Advisers Act Rules and
                  Regulations and does not contain an untrue statement of a
                  material fact or omit to state a material fact





<PAGE>
                                                                              24


                  required to be stated therein or necessary to make the
                  statements therein, in light of the circumstances under which
                  they were made, not misleading;

                           (vii) To the best knowledge of such counsel after
                  reasonable inquiry, other than as described or contemplated in
                  the Registration Statement and the Prospectus (or any
                  amendment or supplement to either of them), subsequent to the
                  respective dates as of which such information is given in the
                  Registration Statement and the Prospectus (or any amendment or
                  supplement to either of them), the Adviser has not incurred
                  any liability or obligation, direct or contingent, or entered
                  into any transaction, not in the ordinary course of business,
                  that is material to the Adviser or the Fund and that is
                  required to be disclosed in the Registration Statement or the
                  Prospectus and there has not been any material adverse change,
                  or any development involving or which may reasonably be
                  expected to involve, a prospective material adverse change, in
                  the condition (financial or other), business, prospects,
                  properties, assets or results of operations of the Adviser,
                  whether or not arising in the ordinary course of business, or
                  which, in each case, could have a material adverse effect on
                  the ability of the Adviser to perform its obligations under
                  the Underwriting Agreement and the Investment Management
                  Agreement; and

                           (viii) Neither the execution, delivery or performance
                  of the Underwriting Agreement or the Investment Management
                  Agreement by the Adviser, nor the consummation by the Adviser
                  of the transactions contemplated in the Underwriting Agreement
                  or the Investment Management Agreement (A) requires the
                  Adviser to obtain any consent, approval, authorization or
                  other order of or registration or filing with, the Commission,
                  the NASD, any state securities commission, any national
                  securities exchange, any arbitrator, any court, regulatory
                  body, administrative agency or other governmental body, agency
                  or official (except such as may have been obtained prior to
                  the date hereof and such as may be required for compliance
                  with the state securities or Blue Sky laws of various
                  jurisdictions in accordance with the Underwriting Agreement)
                  or conflicts or will conflict with or constitutes or will
                  constitute a breach of or a default under, the corporate
                  charter or by-laws, or other organizational documents, of the
                  Adviser or (B) conflicts or will conflict with or constitutes
                  or will constitute a breach of or a default under its
                  corporate charter or by-laws or 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
                  violates or will 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
                  it is a party or by which it may be bound or to which any of
                  the property or assets of the Adviser is subject. The Adviser
                  is not subject to any order of any court or of any arbitrator,
                  governmental authority or administrative agency, except such
                  orders which do not have a material adverse effect on the
                  condition (financial or otherwise), business, properties,
                  prospects, net assets or results of




<PAGE>
                                                                              25


                  operations of the Fund or on the ability of the Fund to
                  perform its obligations under this Agreement and the Fund
                  Agreements.

                  Such counsel shall also state that although counsel has not
         undertaken, except as otherwise indicated in its opinion, to determine
         independently and does not assume any responsibility for, the accuracy
         or completeness of the statements in the Registration Statement, such
         counsel has participated in the preparation of the Registration
         Statement and the Prospectus, including review and discussion of the
         contents thereof and nothing has come to its attention that has caused
         it to believe that the Registration Statement at the time it became
         effective or the Prospectus, as of its date and as of the Closing Date,
         as the case may be, contained an untrue statement of a material fact or
         omitted to state a material fact required to be stated therein or
         necessary to make the statements therein (in the case of a prospectus,
         in light of the circumstances under which they were made) not
         misleading or that any amendment or supplement to the Prospectus, as of
         its date and as of the Closing Date, contained an untrue statement of a
         material fact or omitted to state a material fact necessary in order to
         make the statements therein, in light of the circumstances under which
         they were made, not misleading (it being understood that such counsel
         need express no opinion with respect to the financial statements and
         the notes thereto and the schedules and other financial and statistical
         data included in the Registration Statement or the Prospectus).

                  In rendering such opinion, counsel may limit such opinion to
         matters involving the application of the laws of the State of Illinois,
         the Delaware General Corporation Law statute and the laws of the United
         States and may rely upon an opinion or opinions, each dated the Closing
         Date, of other counsel retained by the Adviser as to laws of any
         jurisdiction other than the United States, the State of Illinois and
         the Delaware General Corporation Law statute, provided that (X) each
         such local counsel is acceptable to the Representative, (Y) such
         reliance is expressly authorized by each opinion so relied upon and a
         copy of each such opinion is delivered to the Representative and is, in
         form and substance satisfactory to it and its counsel and (Z) counsel
         shall state in their view that they believe that they and the
         Underwriters are justified in relying thereon.

                  (f) (i) The Representative shall have received on the Closing
Date an opinion of Orrick, Herrington & Sutcliffe, LLP, special California
counsel to the Fund, dated the Closing Date and addressed to the Representatives
of the several Underwriters, to the effect that:

                  The statements contained in the Prospectus under the headings
                  "Risk Factors - Concentration in California Issuers", "The
                  Fund's Investments--Municipal Bonds - Special Considerations
                  Relating to California Municipal Bonds" and "Tax Matters -
                  California Tax Matters", in the column titled "State Tax Rate"
                  under the caption "Taxable Equivalent Yield Table--
                  California" in Appendix A to the Prospectus and in Appendix D
                  to the statement of additional information, to the extent that
                  such statements constitute matters of law or legal
                  conclusions, provide a fair and accurate summary of such law
                  or conclusions and fairly present the information called for
                  with respect thereto by Form N-2 on the dates such statements
                  were made and as of the Closing Date. Such statements are
                  based on





<PAGE>
                                                                              26


                  current law and special counsel's understanding of the Fund's
                  proposed operations, as disclosed in the Prospectus.

                  Such counsel shall also state that although special counsel
       does not pass upon or assume any responsibility for the accuracy,
       completeness or fairness of the statements contained in the Registration
       Statement or the Prospectus (other than to the extent set forth above),
       and has not made any independent check or verification thereof, no facts
       have come to the attention of such special counsel which would lead it to
       believe that the material contained in the Registration Statement and the
       Prospectus under the headings "Risk Factors - Concentration in California
       Issuers", "The Fund's Investments -- Municipal Bonds - Special
       Considerations Relating to California Municipal Bonds", "Tax Matters -
       California Tax Matters", in the column titled "State Tax Rate" under the
       caption "Taxable Equivalent Yield Table -- California" in Appendix A to
       the Prospectus and in Appendix D to the statement of additional
       information, at the time the Registration Statement became effective, or
       in the Prospectus, as of its date and as of the Closing Date, as the case
       may be, contained an untrue statement of a material fact or omitted to
       state a material fact required to be stated therein or necessary to make
       the statements therein (in the case of a prospectus, in light of the
       circumstances under which they were made) not misleading or that the
       material contained under such headings in any amendment or supplement to
       the Prospectus, as of the Closing Date, contained an untrue statement of
       a material fact or omitted to state a material fact necessary in order to
       make the statements therein, in light of the circumstances under which
       they were made, not misleading.

                  In rendering such opinion, such special counsel may rely as to
       matters of fact, to the extent such special counsel deems proper, on
       certificates of responsible officers of the Fund and of the Manager, and
       of public officials.

                  (ii) The Representative shall have received on the Closing
Date a comfort letter, substantially in the form heretofore approved by you,
from Chapman and Cutler, special counsel to the Fund, dated the Closing Date and
addressed to you, as Representatives of the several Underwriters, with respect
to the information presented in Appendix A to the Prospectus under the heading
"Taxable Equivalent Yield Table".

                  (g) The Representative shall have received on the Closing Date
an opinion of Simpson Thacher & Bartlett, counsel for the Underwriters, dated
the Closing Date and addressed to the Underwriters, with respect to such matters
as the Underwriters may reasonably request and the Fund, the Adviser and their
respective counsels shall have furnished to such counsel such documents as they
may request for the purpose of enabling them to pass upon such matters.

                  (h) The Fund shall have furnished to the Representative on the
Closing Date a certificate, dated the Closing Date, of its President or a Vice
President and its Controller or Treasurer stating that:

                            (i) the signers have carefully examined the
                  Registration Statement, the Prospectus (and any amendments or
                  supplements to either of them) and this Agreement, (ii) the
                  representations and warranties of the Fund in this Agreement



<PAGE>
                                                                              27


                  are true and correct on and as of the date of the certificate
                  as if made on such date, (iii) since the date of the
                  Prospectus (and any amendment or supplement thereto) there has
                  not been any material, adverse change in the condition
                  (financial or other), business, prospects (other than as a
                  result of a change in the financial markets generally),
                  properties, net assets or results of operations of the Fund,
                  (iv) to the knowledge of such officers after reasonable
                  investigation, no order suspending the effectiveness of the
                  Registration Statement or prohibiting the sale of any of the
                  Shares or having a material, adverse effect on the Fund has
                  been issued and no proceedings for any such purpose are
                  pending before or threatened by the Commission or any court or
                  other regulatory body, 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, (v)
                  the Fund has performed and complied in all material respects
                  with all agreements that this Agreement requires it to perform
                  by such Closing Date, (vi) the Fund has not sustained any
                  material loss or interference with its business from any court
                  or from legislative or other governmental action, order or
                  decree or from any other occurrence not described in the
                  Registration Statement and the Prospectus and any amendment or
                  supplement to either of them and (vii) there has not been any
                  change in the capital stock of the Fund nor any material
                  increase in the debt of the Fund from that set forth in the
                  Prospectus (and any amendment or supplement thereto) and the
                  Fund has not sustained any material liabilities or
                  obligations, direct or contingent, other than those reflected
                  in the Prospectus (and any amendment or supplement thereto).

                  (i) The Adviser shall have furnished to the Representative on
the Closing Date a certificate, dated the Closing Date, of its Chairman of the
Board, President or a Vice President and its Controller or Treasurer stating
that:

                             (i) the signers have carefully examined the
                  Registration Statement, the Prospectus (and any amendments or
                  supplements to either of them) and this Agreement, (ii) the
                  representations and warranties of the Adviser in this
                  Agreement are true and correct on and as of the date of the
                  certificate as if made on such date, (iii) since the date of
                  the Prospectus (and any amendment or supplement thereto) there
                  has not been any material, adverse change in the condition
                  (financial or other), business, prospects (other than as a
                  result of a change in the financial markets generally),
                  properties, net assets or results of operations of the
                  Adviser, (iv) to the knowledge of such officers after
                  reasonable investigation, no order suspending the
                  effectiveness of the Registration Statement or prohibiting the
                  sale of any of the Shares or having a material, adverse effect
                  on the Adviser has been issued and no proceedings for any such
                  purpose are pending before or threatened by the Commission or
                  any court or other regulatory body, 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, (v)
                  the Adviser has performed and complied in all material
                  respects with all agreements that this Agreement requires it
                  to perform by such Closing Date, and (vi) the Adviser has not
                  sustained any material loss or interference with its business
                  from any court or from legislative or




<PAGE>
                                                                              28


                  other governmental action, order or decree or from any other
                  occurrence not described in the Registration Statement and the
                  Prospectus and any amendment or supplement to either of them.

                  (j) The Representative shall have received letters addressed
to the Underwriters, and dated the date hereof and the Closing Date from Ernst &
Young LLP, independent certified public accountants, substantially in the forms
heretofore approved by the Representative.

                  (k) (i) No order suspending the effectiveness of the
Registration Statement or prohibiting or suspending the use of the Prospectus
(or any amendment or supplement thereto) or any Prepricing Prospectus or any
sales material shall have been issued and no proceedings for such purpose or for
the purpose of commencing an enforcement action against the Fund, the Adviser
or, with respect to the transactions contemplated by the Prospectus (or any
amendment or supplement thereto) and this Agreement, the Underwriters, may be
pending before or, to the knowledge of the Fund, the Adviser or the Underwriters
or in the reasonable view of counsel to the Underwriters, shall be threatened or
contemplated by the Commission at or prior to the Closing Date and that any
request for additional information on the part of the Commission (to be included
in the Registration Statement, the Prospectus or otherwise) be complied with to
the satisfaction of the Representative ; (ii) there shall not have been any
change in the shares of beneficial interest of the Fund nor any material
increase in the short-term or long-term debt of the Fund (other than in the
ordinary course of business) from that set forth or contemplated in the
Registration Statement or the Prospectus (or any amendment or supplement
thereto); (iii) there shall not have been, subsequent to the respective dates as
of which information is given in the Registration Statement and the Prospectus
(or any amendment or supplement thereto), except as may otherwise be stated in
the Registration Statement and Prospectus (or any amendment or supplement
thereto), any material adverse change in the condition (financial or other),
business, prospects, properties, net assets or results of operations of the Fund
or the Adviser; (iv) the Fund shall not have any liabilities or obligations,
direct or contingent (whether or not in the ordinary course of business), that
are material to the Fund, other than those reflected in the Registration
Statement or the Prospectus (or any amendment or supplement to either of them);
and (v) all the representations and warranties of the Fund and the Adviser
contained in this Agreement shall be true and correct on and as of the date
hereof and on and as of the Closing Date as if made on and as of the Closing
Date.

                  (l) Neither the Fund nor the Adviser shall have failed at or
prior to the Closing Date to have performed or complied in all material respects
with any of its agreements herein contained and required to be performed or
complied with by it hereunder at or prior to the Closing Date.

                  (m) The Fund shall have delivered and the Underwriters shall
have received evidence satisfactory to the Representative that the shares of
MuniPreferred shares are rated 'Aaa' by Moody's 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 any outstanding shares of beneficial interest of the Fund by
any rating agency.



<PAGE>
                                                                              29


                  (n) The Fund and the Adviser shall have furnished or caused to
be furnished to the Underwriters such further certificates, documents and
opinions of counsel as the Representative shall have requested (including
certificates of officers of the Fund and the Adviser).

                  All such opinions, certificates, letters and other documents
will be in compliance with the provisions hereof only if they are satisfactory
in form and substance to the Representative and the Underwriters' counsel.

                  Any certificate or document signed by any officer of the Fund
or the Adviser and delivered to the Underwriters, or to counsel for the
Underwriters, shall be deemed a representation and warranty by the Fund or the
Adviser to the Underwriters as to the statements made therein.

                  10. Expenses. The Fund agrees to pay the costs incident to the
authorization, issuance, sale and delivery of the Shares to be sold by the Fund
to the Underwriters and any taxes payable in that connection; the costs incident
to the preparation, printing and filing under the 1933 Act and 1940 Act of the
Registration Statement and any amendments and exhibits thereto; the costs of
preparing, printing and distributing the Registration Statement as originally
filed and each amendment and any post-effective amendment thereto (including
exhibits), any Prepricing Prospectus, the Prospectus and any amendment or
supplement to the Prospectus; the costs of printing this Agreement and
distributing the terms of agreements relating to the organization of any
underwriting syndicate by mail, telex or other means of communication; the fees
paid to Rating Agencies in connection with the rating of the Shares; the fees
and expenses of qualifying the Shares under the securities laws of the several
jurisdictions as provided in this Section and of preparing and printing a Blue
Sky survey (including related fees and expenses of counsel to the Underwriters);
the fees and expenses of the Auction Agent as set forth in the Auction Agency
Agreement; and all other costs and expenses incident to the performance of the
obligations of the Fund under this Agreement; provided (i) the Fund, the Adviser
and each Underwriter shall pay its own costs and expenses in attending any
information meeting relating to the Fund, (ii) each Underwriter shall pay the
costs and expenses of preparing and distributing any sales material prepared by
it in connection with the public offering of the Shares, (iii) the Underwriters
shall pay the costs and expenses of any "tombstone advertisements and (iv)
except as provided in this Section and in Section 5 hereof, the Underwriters
shall pay their own costs and expenses, including the fees and expenses of their
counsel and any transfer taxes on the Shares which they may sell.

                  If notice shall have been given pursuant to Paragraph 12
terminating the Underwriters' obligations hereunder, or if the sale of the
Shares provided for herein is not consummated because of any failure, refusal or
inability on the part of the Fund or Adviser to perform any agreement on its
part to be performed or if the Underwriters shall decline to purchase the Shares
for any reason permitted under this Agreement, the Fund shall reimburse the
Underwriters for the reasonable fees and expenses of their counsel and for such
other out-of-pocket expenses as shall have been reasonably incurred by them in
connection with this Agreement and the proposed purchase of the Shares, and upon
demand the Fund shall pay the full amount thereof to the Underwriters; it being
understood that the Fund shall not in any event be liable to any of the
Underwriters for damages on account of loss of anticipated profits from





<PAGE>
                                                                              30


the sale by them of the Shares. If the Fund fails to reimburse the Underwriters
for such fees and expenses, the Adviser shall upon demand, pay the full amount
thereof to the Underwriters.

                  11. Effective Date of Agreement. This Agreement shall become
effective: (i) upon the execution and delivery hereof by the parties hereto; or
(ii) if, at the time this Agreement is executed and delivered, it is necessary
for the Registration Statement or a post-effective amendment thereto to be
declared effective before the offering of the Shares may commence, when
notification of the effectiveness of the Registration Statement or such
post-effective amendment has been released by the Commission. Until such time as
this Agreement shall have become effective, it may be terminated by the Fund, by
notifying the Underwriters, or by the Underwriters, by notifying the Fund.

                  If any of the Underwriters shall fail or refuse to purchase
Shares which it is obligated to purchase hereunder on the Closing Date, and the
aggregate number of Shares which such defaulting Underwriter is obligated but
fails or refuses to purchase is not more than one-tenth of the aggregate number
of Shares which the Underwriters are obligated to purchase on the Closing Date,
the non-defaulting Underwriters shall be obligated severally, in the proportion
which the aggregate number of Shares set forth opposite its name in Schedule I
hereto bears to the aggregate number of Shares set forth opposite the names of
all non-defaulting Underwriters or in such other proportion as the
Representative may specify in accordance with the Salomon Smith Barney Master
Agreement Among Underwriters, to purchase on the Closing Date the Shares which
such defaulting Underwriter is obligated, but fails or refuses, to purchase. If
any of the Underwriters shall fail or refuse to purchase Shares which it is
obligated to purchase on the Closing Date and the number of Shares with respect
to which such default occurs is more than one-tenth of the aggregate number of
Shares which the Underwriters are obligated to purchase on the Closing Date and
arrangements satisfactory to the Representative and the Fund for the purchase of
such Shares by the non-defaulting Underwriter or other party or parties approved
by you and the Fund are not made within 36 hours after such default, this
Agreement will terminate without liability on the part of the non-defaulting
Underwriter or the Fund. In any such case which does not result in termination
of this Agreement, either the Representative or the Fund shall have the right to
postpone the Closing Date, but in no event for longer than seven days, in order
that the required changes, if any, in the Registration Statement and the
Prospectus or any other documents or arrangements may be effected. Any action
taken under this paragraph shall not relieve the defaulting Underwriter from
liability in respect of any such default of any such Underwriter under this
Agreement. The term "Underwriter" as used in this Agreement includes, for all
purposes of this Agreement, any party not listed in Schedule I hereto who, with
your approval and the approval of the Fund, purchases Shares which a defaulting
Underwriter is obligated, but fails or refuses, to purchase.

                  Any notice under this Section 11 may be given by telegram,
telecopy or telephone but shall be subsequently confirmed by letter.

                  12. Termination of Agreement. This Agreement shall be subject
to termination in the Representative's absolute discretion, without liability on
the part of the Underwriters to the Fund or the Adviser, by notice to the Fund
or the Adviser, prior to delivery of and payment for the MuniPreferred shares,
if at any time prior to such time (i) trading in the Fund's Common Shares (as
defined in the Prospectus) shall have been suspended by the Commission or the



<PAGE>
                                                                              31


AMEX or trading in securities generally on the NYSE or AMEX shall have been
suspended or limited or minimum prices for trading in securities generally shall
have been established on either of such Exchanges, (ii) a commercial banking
moratorium shall have been declared by either federal or New York state
authorities, or (iii) there shall have occurred any outbreak or escalation of
hostilities or a declaration by the United States of a national emergency or
war, or other calamity or crisis the effect of which on financial markets in the
United States is such as to make it, in the Representative's sole judgment,
impracticable or inadvisable to proceed with the offering or delivery of the
MuniPreferred shares as contemplated by the Prospectus (exclusive of any
supplement thereto). Notice of such termination may be given to the Fund by
telegram, telecopy or telephone and shall be subsequently confirmed by letter.

                  13. Information Furnished by the Underwriters. The statements
set forth in the last paragraph of the cover page and the first, third and
eighth paragraphs under the caption "Underwriting" in any Prepricing Prospectus
and in the Prospectus, constitute the only information furnished by or on behalf
of the Underwriters as such information is referred to in Sections 6(b) and 8
hereof.

                  14. Miscellaneous. Except as otherwise provided in Sections 5,
11 and 12 hereof, notice given pursuant to any provision of this Agreement shall
be in writing and shall be delivered (i) if to the Fund or the Adviser, at the
office of the Fund at 333 West Wacker Drive, Chicago, IL 60606, Attention:
Gifford R. Zimmerman, Managing Director, Assistant Secretary and General Counsel
to the Adviser; (ii) if to the Underwriters, to Salomon Smith Barney Inc., 388
Greenwich Street, New York, New York 10013, Attention: Manager, Investment
Banking Division.

                  This Agreement has been and is made solely for the benefit of
the Underwriters, the Fund, the Adviser, their directors and officers, and the
other controlling persons referred to in Section 8 hereof and their respective
successors and assigns, to the extent provided herein, and no other person shall
acquire or have any right under or by virtue of this Agreement. Neither the term
"successor" nor the term "successors and assigns" as used in this Agreement
shall include a purchaser from the Underwriters of any of the Shares in his
status as such purchaser.

                  15. Applicable Law; Counterparts. This Agreement shall be
governed by and construed in accordance with the laws of the State of New York.

                  16. Limitation of Liability. Consistent with the Fund's
Declaration, notice is hereby given and the parties hereto agree that this
instrument is executed or made by or on behalf of the Fund by the Trustee(s) or
officer(s) of the Fund and not individually by them and that the obligations of
this instrument are not binding upon any of them or the shareholders of the Fund
individually but are binding only upon the assets and property of the Fund.

                  This Agreement may be signed in various counterparts which
together constitute one and the same instrument. If signed in counterparts, this
Agreement shall not become effective unless at least one counterpart hereof
shall have been executed and delivered on behalf of each party hereto.

                     [Rest of page intentionally left blank]



<PAGE>
                  Please confirm that the foregoing correctly sets forth the
agreement among the Fund, the Adviser and the Underwriters.


                                  Very truly yours,

                                  NUVEEN INSURED CALIFORNIA TAX-FREE ADVANTAGE
                                  MUNICIPAL FUND

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

                                  NUVEEN ADVISORY CORP.

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



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

SALOMON SMITH BARNEY INC.

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

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


<PAGE>



                                   SCHEDULE I



           NUVEEN INSURED CALIFORNIA TAX-FREE ADVANTAGE MUNICIPAL FUND



<Table>
<Caption>
                                                             Number of Shares
Underwriters                                                   of Series TH
------------                                                 ----------------


<S>                                                          <C>
Salomon Smith Barney Inc. ..........................                ---

Nuveen Investments .................................                ---

A.G. Edwards & Sons, Inc............................                ---

Prudential Securities Incorporated..................                ---

Total...............................................               1,800
                                                                ========
</Table>



</TEXT>
</DOCUMENT>
