How do I add an event handler to a .NET object in PowerShell?

I'm writing a PowerShell script which uses a third-party library. One of the objects I'm using requires that I add an event handler. The event delegate looks like this:

public delegate void TSBPGPCreateOutputStreamEvent(object Sender, 
                                                   string Filename, 
                                                   System.DateTime TimeStamp, 
                                                   ref System.IO.Stream Stream, 
                                                   ref bool FreeOnExit)

In PowerShell, I tried doing this:

$reader.Add_OnCreateOutputStream( {
    param(
        $sender,
        $fileName,
        $timestamp,
        [ref]
        $stream,
        [ref]
        $freeOnExit
    )
    $stream = New-Object IO.MemoryStream
} )

But I get back this error message:

 Cannot convert value "
    param(
        $sender,
        $fileName,
        $timestamp,
        [ref]
        $stream,
        [ref]
        $freeOnExit
    )
$stream = New-Object IO.MemoryStream
" to type "SBPGP.TSBPGPCreateOutputStreamEvent". 
Error: "The type 'System.IO.Stream&' may not be used as a type argument."

Is there a better way of subscribing to events? Why can't the Stream type be used as a type argument? What am I doing wrong?