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BELL, BOYD & LLOYD LLC
Three First National Plaza
70 West Madison Street, Suite 3300
Chicago, Illinois 60602-4207
312 372-1121
Fax 312 372-2098
December 8, 2000
Liberty Floating Rate Fund
One Financial Center
Boston, MA 02111
Ladies and Gentlemen:
Liberty Floating Rate Fund
We are furnishing this opinion with respect to the proposed offer and
sale from time to time of an additional 45,000,000 shares of beneficial interest
(the "Shares") of the Liberty Floating Rate Fund (the "Fund") registered under
the Securities Act of 1933 and the Investment Company Act of 1940 by a sixth
amendment to the registration statement on Form N-2 (File No. 811-08953) as
amended from time to time (the "Registration Statement") to be filed with the
Securities and Exchange Commission (the "Commission").
We have acted as counsel for the Fund in connection with its initial
organization and its registrations with the Commissions, and we are familiar
with the actions taken by its board of trustees to authorize previously the
issuance, offer and sale of 10,000,000 Shares of each of Class A, Class B, Class
C and Class Z and currently the issuance, offer and sale of an additional
20,000,000 Shares of Class A, 15,000,000 Shares of Class B and 20,000,000 Shares
of Class C.
In this connection we have examined originals, or copies certified or
otherwise identified to our satisfaction, of such documents, corporate and other
records, certificates and other papers as we deemed it necessary to examine for
the purpose of this opinion, including the agreement and declaration of trust
(the "Trust Agreement") and by-laws of the Fund, actions of the board of
trustees of the Fund authorizing the issuance of shares of the Fund and the
Registration Statement.
We assume that, upon sale of the Shares, the Fund will receive the
authorized consideration therefor, which will at least equal the net asset value
of the Shares.
Based upon the foregoing, we are of the opinion that the Fund is
authorized to issue the 20,000,000 Shares of Class A, 15,000,000 Shares of Class
B and 20,000,000 Shares of Class C, and that, when the Shares are issued and
sold after the Registration Statement has been declared effective and the
authorized consideration therefor is received by the Fund, they will be validly
issued, fully paid and nonassessable by the Fund.
The Fund is an entity of the type commonly known as a "Massachusetts
business trust." Under Massachusetts law, shareholders could, under certain
circumstances, be held personally liable for the obligations of the Fund.
However, the Trust Agreement disclaims shareholder liability for acts or
obligations of the Fund and requires that notice of such disclaimer be given in
every note, bond, contract, instrument, certificate or other undertaking issued
by or on behalf of the Fund. The Trust Agreement provides for indemnification
for all loss and expense of any shareholder of the Fund held personally liable
for obligations of the Fund. Thus, the risk of a shareholder incurring financial
loss on account of shareholder liability is limited to circumstances in which
the Fund would be unable to meet its obligations.
In rendering the foregoing opinion, we have relied upon the opinion of
Ropes & Gray expressed in their letter to us dated ________, 2000.
We consent to the filing of this opinion as an exhibit to the
Registration Statement. In giving this consent, we do not admit that we are in
the category of persons whose consent is required under section 7 of the Act.
Very truly yours,
/s/ Bell, Boyd & Lloyd LLC
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