EXHIBIT 99.B1(a)
MASTER INVESTMENT PORTFOLIO
Amended and Restated Agreement and Declaration of Trust
THIS AMENDED AND RESTATED AGREEMENT AND DECLARATION OF TRUST,
made this 3rd day of January, 1994, by the Trustees hereunder (hereinafter with
any additional and successor trustees referred to as the "Trustees") and by the
holders of Interests to be issued hereunder as hereinafter provided.
W I T N E S S E T H :
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WHEREAS, the Trustees have agreed to manage all property
coming into their hands as trustees of a Delaware business trust in accordance
with the provisions hereinafter set forth.
NOW, THEREFORE, the Trustees hereby declare that they will
hold all cash, securities and other assets, which they may from time to time
acquire in any manner as Trustees hereunder IN TRUST to manage and dispose of
the same upon the following terms and conditions for the pro rata benefit of the
holders from time to time of Interests, whether or not certificated, in this
Trust as hereinafter set forth.
ARTICLE I
Name and Definitions
Section 1. Name. This Trust shall be known as Master
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Investment Portfolio.
Section 2. Definitions. Whenever used herein, unless otherwise
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required by the context or specifically provided:
(a) The term "Commission" shall have the meaning provided in
the 1940 Act;
(a) The "Trust" refers to the Delaware business trust
established by this Agreement and Declaration of Trust, as amended from time to
time;
(b) The term "Interestholder" shall mean a record owner of
Interests of the Trust;
(c) The term "Interests" shall mean the equal proportionate
non-transferable units of interest into which the beneficial interest in the
Trust shall be divided from time to time or, if more than one series or class of
Interests is authorized by the Trustees, the equal proportionate
non-transferable units into which each series or class of Interests shall be
divided from time to time, and includes a fraction of an Interest as well as a
whole Interest;
(d) The "1940 Act" refers to the Investment Company Act of
1940, and the Rules and Regulations thereunder, all as amended form time to
time;
(e) The term "Manager" is defined in Article IV, Section 5;
(f) The term "Person" shall mean an individual or any
corporation, partnership, joint venture, trust or other enterprise;
(g) "Declaration of Trust" shall mean this Agreement and
Declaration of Trust as amended or restated from time to time;
(h) "Bylaws" shall mean the Bylaws of the Trust as amended
from time to time;
(i) The term "series" or "series of Interests" refers to the
one or more separate investment portfolios of the Trust into which the assets
and liabilities of the Trust may be divided and the Interests of the Trust
representing the beneficial interest of Interestholders in such respective
portfolios;
(j) The term "class" or "class of Interests" refers to the
division of Interests representing any series into two or more classes as
provided in Article III, Section 1 hereof;
(k) The term "Delaware Act" shall mean the Delaware Business
Trust Act, 12 Del.C. ss. 3801, et seq.; and
(l) The term "Bankruptcy" shall mean, with respect to any
Interestholder, any of the following:
(i) filing a voluntary petition in bankruptcy or for
reorganization or for the adoption of an arrangement under the Bankruptcy Code
(as now or in the future amended) or an admission seeking the relief therein
provided;
(i) making a general assignment for the benefit of
creditors;
(ii) consenting to the appointment of a receiver for
all or a substantial part of such Interestholder's property;
(iii) in the case of the filing of an involuntary petition
in bankruptcy, an entry of an order for relief;
(iv) the entry of a court order appointing a receiver or
trustee for all or a substantial part of such Interestholder's property without
its consent; or
(v) the assumption of custody or sequestration by a
court of competent jurisdiction of all or substantially all of such
Interestholder's property.
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(m) The term "Adjusted Basis" shall mean, with respect to any
Security, its adjusted basis for federal income tax purposes.
(n) The term "Adjusted Gross Asset Value" shall mean, with
respect to a Built-in Gain Security, the lesser of (i) the Gross Asset Value of
such Security on the day such Security is contributed to the Trust and (ii) the
lowest Gross Asset Value of such Security on any day thereafter, and, with
respect to a Built-in Loss Security, the higher of (i) the Gross Asset Value of
such Security on the day such Security is contributed to the Trust and (ii) the
highest Gross Asset Value of such Security on any day thereafter.
(o) The term "Appreciated Security" shall mean any Security
held by the Trust immediately before but on the same day as a new Interestholder
is admitted to the Trust if on such day the Gross Asset Value of such Security
exceeds its Adjusted Basis or if such Security is a Built-in Gain Security its
Adjusted Gross Asset Value.
(p) The term "Book Capital Account" shall mean, with respect
to any Interestholder, the Capital Account maintained for such Interestholder
on a daily basis in accordance with the following provisions:
(ii) To each Interestholder's Book Capital Account there
shall be credited (a) the amount of money and the Gross Asset Value of any
property contributed by such Interestholder to the Trust, (b) such
Interestholder's distributive share of Net Income, (c) such Interestholder's
distributive share of Book Sales Gain, and (d) the amount of any Trust
liabilities assumed by such Interestholder or which are secured by any property
distributed to such Interestholder.
(i) To each Interestholder's Book Capital Account there
shall be debited (a) the amount of money and the Gross Asset Value of any
property distributed to such Interestholder pursuant to any provision of this
Agreement, (b) such Interestholder's distributive share of Net Loss, (c) such
Interestholder's distributive share of Book Sales Loss, and (d) and the amount
of any liabilities of such Interestholder assumed by the Trust or which are
secured by any property contributed by such Interestholder to the Trust.
Any decisions relating to the maintenance of Book Capital
Accounts shall be made by the Trustees in any manner that reasonably reflects
the purpose and intention of this Agreement. In the event the Trustees shall
determine that it is prudent to modify the manner in which the Book Capital
Accounts, or any debits or credits thereto, are computed in order to reflect the
purpose and intention of this Agreement, the Trustee may make such modification.
(q) The terms "Book Sales Gain" or "Book Sales Loss" shall
mean, for any day, the difference, positive or negative, as the case may be,
between (x) the aggregate gross asset value of all Securities held by the Trust
at any time during such day other than Securities acquired by the Trust on such
day and (y) the aggregate gross asset value of all such Securities as determined
for the preceding day.
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(r) The term "Built-in Gain Security" shall mean any Security
contributed by an Interestholder to the Trust if on the day such Security is
contributed to the Trust, its Gross Asset Value exceeds its Adjusted Basis.
(s) The term "Built-in Loss Security" shall mean any Security
contributed by an Interestholder to the Trust if on the day such Security is
contributed to the Trust, its Gross Asset Value is less than its Adjusted Basis.
(t) The term "Code" shall mean the Internal Revenue Code of
1986, as amended from time to time (or any corresponding provisions of
succeeding law).
(u) The term "Depreciated Security" shall mean any Security
held by the Trust immediately before but on the same day as a new Interestholder
is admitted to the Trust if on such day such Security's Gross Asset Value is
less than its Adjusted Basis or if such Security is a Built-in Loss Security its
Adjusted Gross Asset Value.
(v) The term "Gross Asset Value" shall mean, with respect to
any Security, the value of such Security determined as follows:
Securities are valued at the last sale price on the securities
exchange on which such securities are primarily traded or at
the last sale price on the national securities market.
Securities not listed on an exchange or national securities
market, or securities in which there were no transactions, are
valued at the average of the most recent bid and asked prices.
Bid price is used when no asked price is available. Market
quotations for foreign securities in foreign currencies are
translated into U.S. dollars at the prevailing rates of
exchange. Any securities or other assets for which recent
market quotations are not readily available are valued at fair
market as determined in good faith by the Trustees. Securities
sold are valued for the day of sale at their net sales price.
(w) The term "Modified Gross Asset Value" shall mean, with
respect to an Appreciated Security, the lesser of (i) the Gross Asset Value of
such Security on the day such Security became an Appreciated Security and (ii)
the lowest Gross Asset Value of such Security on any day thereafter, and, with
respect to a Depreciated Security, the higher of (i) the Gross Asset Value of
such Security on the day such Security became a Depreciated Security and (ii)
the highest Gross Asset Value of such Security on any day thereafter.
(x) The terms "Net Income" or "Net Loss" shall mean, for any
day, the sum, if positive, or if negative, as the case may be, of all items of
income, gain, deduction and loss (other than items included in computing Tax
Sales Gain, Tax Sales Loss, Remaining Built-in Gain, Remaining Built-in Loss,
Remaining Appreciated Gain or Remaining Depreciated Loss) recognized by the
Trust on such day for federal income tax purposes and determined in accordance
with the provisions of this Agreement.
(y) The term "Percentage Interest" shall mean, with respect to
any Interestholder, as of any day, the ratio (expressed as a percentage) of such
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Interestholder's Book Capital Account as of the close of business on the
preceding day to the aggregate Book Capital Accounts of all Interestholders as
of the close of business on such preceding day, such Book Capital Accounts to be
determined after giving effect to all contributions, distributions, and
allocations through such preceding day.
(z) The term "Positive Book/Tax Disparity" shall mean, with
respect to any Interestholder, the excess (if any) of such Interestholder's Book
Capital Account over the sum of such Interestholder's (i) Tax Capital Account,
(ii) Remaining Built-in Gain with respect to each Built-in Gain Security
contributed b y such Interestholder to the Trust and (iii) share of Remaining
Appreciated Gain.
(aa) The term "Positive Tax/Book Disparity" shall mean, with
respect to any Interestholder, the excess (if any) of such Interestholder's Tax
Capital Account over the sum of such Interestholder's (i) Book Capital Account,
(ii) Remaining Built-in Loss with respect to each Built-in Loss Security
contributed by such Interestholder to the Trust and (iii) share of Remaining
Depreciated Gain.
(bb) The term "Regulations" shall mean the Income Tax
Regulations, including Temporary Regulations, promulgated under the Code, as
such regulations may be amended from time to time (including corresponding
provisions of succeeding regulations).
(cc) The term "Remaining Appreciated Gain" shall mean, with
respect to each Appreciated Security, the excess (if any) of such Security's
Modified Gross Asset Value over such Security's Adjusted Basis, or if such
Security is a Built-in Gain Security its Adjusted Gross Asset Value, on the day
such Security became an Appreciated Security.
(dd) The term "Remaining Built-in Gain" shall mean, with
respect to each Built-in Gain Security, the excess (if any) of such Security's
Adjusted Gross Asset Value over such Security's Adjusted Basis on the day such
Security is contributed to the Trust.
(ee) The term "Remaining Built-in Loss" shall mean, with
respect to each Built-in Loss Security, the excess (if any) of such Security's
Adjusted Basis on the day such Security is contributed to the Trust over such
Security's Adjusted Gross Asset Value.
(ff) The term "Remaining Depreciated Loss" shall mean, with
respect to each Depreciated Security, the excess (if any) of such Security's
Adjusted Basis, or if such Security is a Built-in Loss Security its Adjusted
Gross Asset Value, on the day such Security became a Depreciated Security over
such Security's Modified Gross Asset Value.
(gg) The term "Tax Capital Account" shall mean, with respect
to any Interestholder, the Capital Account maintained for such Interestholder on
a daily basis in accordance with the following provisions:
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(iii) To each Interestholder's Tax Capital Account there
shall be credited (a) the amount of money and the Adjusted Basis of any property
contributed by such Interestholder to the Trust, (b) such Interestholder's
distributive share of Net Income, (c) such Interestholder's distributive share
of Tax Sales Gain, and (d) the amount of any Trust liabilities assumed by such
Interestholder or which are secured by any property distributed to such
Interestholder.
(i) To each Interestholder's Tax Capital Account there
shall be debited (a) the amount of money and the Gross Asset Value of any
property distributed to such Interestholder pursuant to any provision of this
Agreement, (b) such Interestholder's distributive share of Net Loss, (c) such
Interestholder's distributive share of Tax Sales Loss, and (d) the amount of any
liabilities of such Interestholder assumed by the Trust or which are secured by
any property contributed by such Interestholder to the Trust.
Any decisions relating to the maintenance of Tax Capital
Accounts shall be made by the Trustees in any manner that reasonably reflects
the purpose and intention of this Agreement. In the event the Trustees shall
determine that it is prudent to modify the manner in which the Tax Capital
Accounts, or any debits or credits thereto, are computed in order to reflect the
purpose and intention of this Agreement, the Trustee may make such modification.
(hh) The terms "Tax Sales Gain" or "Tax Sales Loss" shall
mean, for any day, the sum, if positive, or if negative, as the case may be, of
all items of gain or loss recognized by the Trust on such day for federal income
tax purposes from the sale or other disposition of Securities (other than items
of gain or loss included in Remaining Built-in Gain, Remaining Built-in Loss,
Remaining Appreciated Gain or Remaining Depreciated Loss with respect to such
Securities).
ARTICLE II
Purposes of Trust
This Trust is formed for the following purpose or purposes:
(a) to conduct, operate and carry on the business of an
investment company;
(b) to subscribe for, invest in, reinvest in, purchase or
otherwise acquire, hold, pledge, sell, assign, transfer, lend, write options on,
exchange, distribute or otherwise dispose of and deal in and with securities of
every nature, kind, character, type and form, including, without limitation of
the generality of the foregoing, all types of stocks, shares, futures contracts,
bonds, debentures, notes, bills and other negotiable or non-negotiable
instruments, obligations, evidences of interest, certificates of interest,
certificates of participation, certificates, interests, evidences of ownership,
guarantees, warrants, options or evidences of indebtedness issued or created by
or guaranteed as to principal and interest by any state or local government or
any agency or instrumentality thereof, by the United States Government or any
agency, instrumentality, territory, district or possession thereof, by any
foreign government or any agency, instrumentality, territory,
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district or possession thereof, by any corporation organized under the laws of
any state, the United States or any territory or possession thereof or under
the laws of any foreign country, bank certificates of deposit, bank time
deposits, bankers' acceptances and commercial paper; to pay for the same in
cash or by the issue of stock, including treasury stock, bonds or notes of the
Trust or otherwise; and to exercise any and all rights, powers and privileges
of ownership or interest in respect of any and all such investments of every
kind and description, including, without limitation, the right to consent and
otherwise act with respect thereto, with power to designate one or more
persons, firms, associations or corporations to exercise any of said rights,
powers and privileges in respect of any said instruments;
(c) to borrow money or otherwise obtain credit and to secure
the same by mortgaging, pledging or otherwise subjecting as security the assets
of the Trust;
(d) to issue, sell, repurchase, redeem, retire, cancel,
acquire, hold, resell, reissue, dispose of, and otherwise deal in, Interests
including Interests in fractional denominations, and to apply to any such
repurchase, redemption, retirement, cancellation or acquisition of Interests any
funds or other assets of the appropriate series or class of Interests, whether
capital or surplus or otherwise, to the full extent now or hereafter permitted
by the laws of the State of Delaware;
(e) to conduct its business, promote its purposes, and carry
on its operations in any and all of its branches and maintain offices both
within and without the State of Delaware, in any and all States of the United
States of America, in the District of Columbia, and in any other parts of the
world; and
(f) to do all and everything necessary, suitable, convenient,
or proper for the conduct, promotion, and attainment of any of the businesses
and purposes herein specified or which at any time may be incidental thereto or
may appear conducive to or expedient for the accomplishment of any of such
businesses and purposes and which might be engaged in or carried on by a Trust
organized under the Delaware Act, and to have and exercise all of the powers
conferred by the laws of the State of Delaware upon a Delaware business trust.
The foregoing provisions of this Article II shall be construed
both as purposes and powers and each as an independent purpose and power.
ARTICLE III
Beneficial Interest
Section 1. Interests. The Interests of the Trust are
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non-transferable and shall be issued in one or more series as the Trustees may,
without Interestholder approval, authorize. Each series shall be separate from
all other series in respect of the assets and liabilities allocated to that
series and shall represent a separate investment portfolio of the Trust. The
beneficial interest in each series at all times shall be divided
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into Interests, with or without par value as the Trustees may from time to
time determine, each of which shall, except as provided in the following
sentence, represent an equal proportionate interest in the series with each
other Interest of the same series, none having priority or preference over
another. The Trustees may, without Interestholder approval, divide Interests
of any series into two or more classes, Interests of each such class having
such preferences and special or relative rights and privileges (including
conversion rights, if any) as the Trustees may determine. The number of
Interests authorized shall be unlimited, and the Interests so authorized may
be represented in part by fractional Interests. From time to time, the
Trustees may divide or combine the Interests of any series or class into a
greater or lesser number without thereby changing the proportionate beneficial
interests in the series or class.
All consideration received by the Trust for the issue or sale
of Interests of a particular series, together with all assets in which such
consideration is invested or reinvested, all income, earnings, profits, and
proceeds thereof, including any proceeds derived from the sale, exchange or
liquidation of such assets, and any funds or payments derived from any
reinvestment of such proceeds in whatever form the same may be, shall be held
and accounted for separately from the other assets of the Trust and of every
other series and may be referred to herein as "assets of" that series. The
assets of a particular series shall belong to that series for all purposes, and
to no other series, subject only to the rights of creditors of that series. In
addition, any assets, income, earnings, profits or funds, or payments and
proceeds with respect thereto, which are not readily identifiable as belonging
to any particular series shall be allocated by the Trustees between and among
one or more of the series in such manner as the Trustees, in their sole
discretion, deem fair and equitable. Each such allocation shall be conclusive
and binding upon the Interestholders of all series for all purposes, and such
assets, income, earnings, profits or funds, or payments and proceeds with
respect thereto shall be assets of that series. The assets of a particular
series shall be so recorded upon the books of the Trust, and shall be held by
the Trustees in trust for the benefit of the holders of Interests of that
series. The assets of each particular series shall be charged with the
liabilities of that series and all expenses, costs, charges and reserves
attributable to that series. Any general liabilities, expenses, costs, charges
or reserves of the Trust which are not readily identifiable as belonging to any
particular series shall be allocated and charged by the Trustees between or
among any one or more of the series in such manner as the Trustees in their sole
discretion deem fair and equitable. Each such allocation shall be conclusive and
binding upon the Interestholders of all series for all purposes. Without
limitation of the foregoing provisions of this Section, but subject to the right
of the Trustees in their discretion to allocate general liabilities, expenses,
costs, charges or reserves as herein provided, the debts, liabilities,
obligations and expenses incurred, contracted for or otherwise existing with
respect to a particular series shall be enforceable against the assets of such
series only, and not against the assets of any other series. Notice of this
limitation on inter-series liabilities may, in the Trustees' sole discretion, be
set forth in the certificate of trust of the Trust (whether originally or by
amendment) as filed or to be filed in the Office of the Secretary of State of
the State of Delaware pursuant to the Delaware Act, and upon the giving of such
notice in the certificate of trust, the statutory provisions of Section 3804 of
the Delaware Act relating to limitations on inter-series liabilities (and the
statutory effect under Section 3804 of setting forth such notice in the
certificate of trust)
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shall become applicable to the Trust and each series. Every note, bond,
contract or other undertaking issued by or on behalf of a particular series
shall include a recitation limiting the obligation represented thereby to that
series and its assets. No shareholder or former Interestholder of any series
shall have a claim on or any right to any assets allocated or belonging to any
other series.
The establishment and designation of any series or of any
class of Interests of any series shall be effective (i) upon the execution by a
majority of the Trustees of an instrument setting forth such establishment and
designation of the relative rights and preferences of the Interests of such
series or class, (ii) upon the execution of an instrument in writing by an
officer of the Trust pursuant to the vote of a majority of the Trustees, or
(iii) as otherwise provided in either such instrument. At any time that there
are no Interests outstanding of any particular series or class previously
established and designated, the Trustees may by an instrument executed by a
majority of the Trustees (or by an instrument executed by an officer of the
Trust pursuant to the vote of a majority of the Trustees) abolished that series
or class and the establishment and designation thereof. Each instrument
establishing and designating any series or class shall have the status of an
amendment to this Declaration of Trust.
Section 2. Non-Transferability. An Interestholder may not
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transfer, sell or exchange Interests of the Trust, except to the Trust.
Notwithstanding the foregoing, an Interestholder may assign its right to receive
dividends, distributions or other allocations of income or property from the
Trust, but such assignment will not result in a change of ownership of the
Interestholder's Interests of the Trust.
Section 3. Ownership of Interests. The ownership of Interests
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will be recorded in the books of the Trust or a transfer agent. The record books
of the Trust or any transfer agent, as the case may be, shall be conclusive as
to who are the holders of Interests of each series and class and as to the
number of Interests of each series and class held from time to time by each. No
certificates certifying the ownership of Interests need be issued except as the
Trustees may otherwise determine from time to time.
Section 4. Issuance of Interests. The Trustees are authorized,
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from time to time, to issue or authorize the issuance of Interests at not less
than the par value thereof, if any, and to fix the price or the minimum price or
the consideration (in cash and/or such other property, real or personal,
tangible or intangible, as from time to time they may determine) or minimum
consideration for such Interests, all without action or approval of the
Interestholders. Interests so issued shall be validly issued, fully paid and
nonassessable. Anything herein to the contrary notwithstanding, the Trustees may
issue Interests pro rata to the Interestholders of a series at any time for no
consideration as a stock dividend, except to the extent otherwise required or
permitted by the preferences and special or relative rights and privileges of
any classes of Interests of that series, and any stock dividend to the
Interestholders of a particular class of Interests shall be made to such
Interestholders pro rata in proportion to the number of Interests of such class
held by each of them.
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Interests may be issued in fractional denominations to the
same extent as whole Interests, and Interests in fractional denominations shall
be Interests having proportionately to the respective fractions represented
thereby all the rights of whole Interests, including, without limitation, the
right to vote, the right to receive dividends and distributions, and the right
to participate upon liquidation of the Trust or of a particular series of
Interests.
The Trustees may classify or re-classify any unissued
Interests or Interests previously issued and reacquired of any series or class
thereof into one or more series or classes thereof that may be established and
designated from time to time. The Trustees may hold as treasury Interests,
re-issue for such consideration and on such terms as they may determine, or
cancel, in their discretion from time to time, any Interests of any series or
class thereof reacquired by the Trust.
Section 5. No Preemptive or Appraisal Rights; Derivative
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Suits. Interestholders shall have no preemptive or appraisal or other right to
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subscribe for any additional Interests or other securities issued by the Trust.
Interestholders shall have no right to demand payment for their Interests or any
other rights of dissenting shareholders in the event the Trust participates in
any transaction which would give rise to appraisal or dissenters' rights by a
shareholder of a corporation organized under the General Corporation Law of the
State of Delaware, or otherwise. No action may be brought by a Interestholder on
behalf of the Trust or a series unless Interestholders owning not less than 10
percent of the then outstanding Interests or series join in the bringing of such
action.
Section 6. Status of Interests and Limitation of Personal
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Liability. Interests shall be deemed to be personal property giving only the
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rights provided in this instrument. Every Interestholder by virtue of having
become a Interestholder shall be held to have expressly assented and agreed to
the terms hereof and to have become a party hereto. The death of an
Interestholder during the continuance of the Trust shall not operate to
terminate the same nor entitle the representative of any deceased Interestholder
to an accounting or to take any action in court or elsewhere against the Trust
or the Trustees, but only to the rights of said decedent under this Trust.
Ownership of Interests shall not entitle the Interestholder to any title in or
to the whole or any part of the Trust property or right to call for a partition
or division of the same or for an accounting, nor shall the ownership of
Interests constitute the Interestholders partners. Interestholders of a series
of the Trust shall be jointly and severally liable (with rights of contribution
inter se in proportion to their respective interests in that series) for the
liabilities and obligations of such series in the event the Trust fails to
satisfy such liabilities and obligations. Neither the Trust nor the Trustees,
nor any officer, employee or agent of the Trust shall have any power to bind any
Interestholder or Trustee personally or, subject to the preceding sentence, to
call upon any Interestholder for the payment of any sum of money or assessment
whatsoever other than such as the Interestholder at any time personally may
agree to pay by way of subscription for any Interests or otherwise. Every note,
bond, contract or other undertaking issued by or on behalf of a particular
series shall include a recitation limiting the obligation represented thereby to
that series and its assets.
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ARTICLE IV
Trustees
Section 1. Election. A Trustee may be elected either by the
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Trustees or the Interestholders. The Trustees named herein shall serve until the
first meeting of the Interestholders or until the election and qualification of
their successors. Prior to the first meeting of Interestholders the initial
Trustees hereunder may elect additional Trustees to serve until such meeting and
until their successors are elected and qualified. The Trustees also at any time
may elect Trustees to fill vacancies in the number of Trustees. The number of
Trustees shall be fixed from time to time by the Trustees and, at or after the
commencement of the business of the Trust, shall be not less than three. Each
Trustee, whether named above or hereafter becoming a Trustee, shall serve as a
Trustee during the lifetime of this Trust, until such Trustee dies, resigns,
retires, or is removed, or, if sooner, until the next meeting of Interestholders
called for the purpose of electing Trustees and the election and qualification
of his successor. Subject to Section 16(a) of the 1940 Act, the Trustees may
elect their own successors and, pursuant to this Section, may appoint Trustees
to fill vacancies.
Section 2. Powers. The Trustees shall have all powers
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necessary or desirable to carry out the purposes of the Trust, including,
without limitation, the powers referred to in Article II hereof. Without
limiting the generality of the foregoing, the Trustees may adopt By-Laws not
inconsistent with this Declaration of Trust providing for the conduct of the
business of the Trust and may amend and repeal them to the extent that they do
not reserve that right to the Interestholders and such By-Laws are deemed to
be incorporated and included in this Declaration of Trust; they may fill
vacancies in their number, including vacancies resulting from increases in
their own number, and may elect and remove such officers and employ, appoint
and terminate such employees or agents as they consider appropriate; they may
appoint from their own number and terminate any one or more committees; they
may employ one or more custodians of the assets of the Trust and may authorize
such custodians to employ subcustodians and to deposit all or any part of such
assets in a system or systems for the central handling of securities, retain a
transfer agent and an Interestholder servicing agent, or both, provide for the
distribution of Interests through a principal placement agent or otherwise,
set record dates, and in general delegate such authority as they consider
desirable (including, without limitation, the authority to purchase and sell
securities and to invest funds, to determine the net income of the Trust for
any period, the value of the total assets of the Trust and the net asset value
of each Interest, and to execute such deeds, agreements or other instruments
either in the name of the Trust or the names of the Trustees or as their
attorney or attorneys or otherwise as the Trustees from time to time may deem
expedient) to any officer of the Trust, committee of the Trustees, any such
employee, agent, custodian or underwriter or to any Manager.
Without limiting the generality of the foregoing, the Trustees
shall have full power and authority:
(a) To invest and reinvest cash and to hold cash uninvested;
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(b) To vote or give assent, or exercise any rights of
ownership, with respect to stock or other securities or property; and to execute
and deliver proxies or powers of attorney to such person or persons as the
Trustees shall deem proper, granting to such person or persons such power and
discretion with relation to securities or property as the Trustees shall deem
proper;
(c) To hold any security or property in a form not indicating
any trust whether in bearer, unregistered or other negotiable form or in the
name of the Trust or custodian, subcustodian or other depository or a nominee or
nominees or otherwise;
(d) To consent to or participate in any plan for the
reorganization, consolidation or merger of any corporation or concern, any
security of which is held in the Trust; to consent to any contract, lease,
mortgage, purchase or sale of property by such corporation or concern, and to
pay calls or subscriptions with respect to any security held in the Trust;
(e) To join with other security holders in acting through a
committee, depositary, voting trustee or otherwise, and in that connection to
deposit any security with, or transfer any security to, any such committee,
depositary or trustee, and to delegate to them such power and authority with
relation to any security (whether or not so deposited or transferred) as the
Trustees shall deem proper, and to agree to pay, and to pay, such portion of the
expenses and compensation of such committee, depositary or trustee as the
Trustees shall deem proper;
(f) To compromise, arbitrate, or otherwise adjust claims in
favor of or against the Trust or any matter in controversy, including, but not
limited to, claims for taxes;
(g) Subject to the provisions of Article III, Section 1, to
allocate assets, liabilities, income and expenses of the Trust to a particular
series of Interests or to apportion the same among two or more series, provided
that any liabilities or expenses incurred by a particular series of Interests
shall be payable solely out of the assets and by the Interestholders of that
series; and to the extent necessary or appropriate to give effect to the
preferences and special or relative rights and privileges of any classes of
Interests, to allocate assets, liabilities, income and expenses of a series to a
particular class of Interests of that series or to apportion the same among two
or more classes of Interests of that series;
(h) To enter into joint ventures, general or limited
partnerships and any other combinations or associations;
(i) To purchase and pay for entirely out of Trust property
such insurance as they may deem necessary or appropriate for the conduct of
the business, including, without limitation, insurance policies insuring the
assets of the Trust and payment of distributions and principal on its
portfolio investments, and insurance policies insuring the Interestholders,
Trustees, officers, employees, agents, investment advisers or Managers,
principal underwriters, or independent contractors of the Trust individually
12
against all claims and liabilities of every nature arising by reason of
holding, being or having held any such office or position, or by reason of any
action alleged to have been taken or omitted by any such person as
Interestholder, Trustee, officer, employee, agent, investment adviser or
Manager, principal underwriter, or independent contractor, including any
action taken or omitted that may be determined to constitute negligence,
whether or not the Trust would have the power to indemnify such person against
such liability;
(j) To pay pensions for faithful service, as deemed
appropriate by the Trustees, and to adopt, establish and carry out pension,
profit-sharing, share bonus, share purchase, savings, thrift and other
retirement, incentive and benefit plans, trusts and provisions, including the
purchasing of life insurance and annuity contracts as a means of providing
such retirement and other benefits, for any or all of the Trustees, officers,
employees and agents of the Trust;
(k) To establish a registered office and have a registered
agent in the State of Delaware;
(l) To establish separate and distinct series with separately
defined investment objectives and policies and separately defined investment
purposes in accordance with the provisions of Article III hereof and to
establish classes of such series having relative rights, powers and duties as
they may provide consistent with applicable law;
(m) Subject to Article X, Section 9 hereof, to reorganize the
Trust; and
(n) Subject to Article X, Section 10 hereof, to sell all or
substantially all of the assets of the Trust or any series.
Further, without limiting the generality of the foregoing, the
Trustees shall have full power and authority to incur and pay out of the
principal or income of the Trust such expenses and liabilities as may be deemed
by the Trustees to be necessary or proper for the purposes of the Trust;
provided, however, that all expenses and liabilities incurred by or arising in
-------- -------
connection with a particular series of Interests, as determined by the Trustees,
shall be payable solely out of the assets and by the Interestholders of that
series.
Any determination made in good faith and, so far as accounting
matters are involved, in accordance with generally accepted accounting
principles by or pursuant to the authority granted by the Trustees, as to the
amount of the assets, debts, obligations or liabilities of the Trust, its
Interestholders or a particular series or class of Interests; the amount of any
reserves or charges set up and the propriety thereof; the time of or purpose for
creating such reserves or charges; the use, alteration or cancellation of any
reserves or charges (whether or not any debt, obligation or liability for which
such reserves or charges shall have been created shall have been paid or
discharged or shall be then or thereafter required to be paid or discharged);
the price or closing bid or asked price of any investment owned or held by the
Trust or a particular series; the market value of any investment or fair value
of any other asset of the Trust or a particular series; the number
13
of Interests outstanding; the estimated expense to the Trust or a particular
series in connection with purchases of its Interests; the ability to liquidate
investments in an orderly fashion; and the extent to which it is practicable
to deliver a cross-section of the portfolio of the Trust or a particular
series in payment for any such Interests, or as to any other matters relating
to the issue, sale, purchase and/or other acquisition or disposition of
investments or Interests of the Trust or a particular series, shall be final
and conclusive, and shall be binding upon the Trust or such series and its
Interestholders, past, present and future, and Interests are issued and sold
on the condition and understanding that any and all such determinations shall
be binding as aforesaid.
Section 3. Meetings. At any meeting of the Trustees, a
--------- --------
majority of the Trustees then in office shall constitute a quorum. Any meeting
may be adjourned from time to time by a majority of the votes cast upon the
question, whether or not a quorum is present, and the meeting may be held as
adjourned without further notice.
When a quorum is present at any meeting, a majority of the
Trustees present may take any action, except when a larger vote is required by
this Declaration of Trust, the By-Laws or the 1940 Act.
Any action required or permitted to be taken at any meeting of
the Trustees or of any committee thereof may be taken without a meeting, if a
written consent to such action is signed by a majority of the Trustees or
members of any such committee then in office, as the case may be, and such
written consent is filed with the minutes of proceedings of the Trustees or any
such committee.
The Trustees or any committee designed by the Trustees may
participate in a meeting of the Trustees or such committee by means of a
conference telephone or similar communications equipment by means of which all
persons participating in the meeting can hear each other at the same time.
Participation by such means shall constitute presence in person at a meeting.
Notwithstanding anything to the contrary stated in this
Section 3, unless otherwise permitted under the 1940 Act, meetings of the
Trustees to approve advisory agreements or distribution arrangements shall be
held in person.
Section 4. Ownership of Assets of the Trust. Title to all of
--------- --------------------------------
the assets of each series of Interests of the Trust at all times shall be vested
in the Trust as a separate legal entity under the Delaware Act.
Section 5. Investment Advice and Management Services. The
--------- -----------------------------------------
Trustees shall not in any way be bound or limited by any present or future law
or custom in regard to investments by trustees. The Trustees from time to time
may enter into a written contract or contracts with any person or persons
(herein called the "Manager"), including any firm, corporation, trust or
association in which any Trustee or Interestholder may be interested, to act as
investment advisers and/or managers of the Trust and to provide such investment
advice and/or management as the Trustees from time to time may consider
necessary for the proper management of the assets of the Trust,
14
including, without limitation, authority to determine from time to time what
investments shall be purchased, held, sold or exchanged and what portion, if
any, of the assets of the Trust shall be held uninvested and to make changes in
the Trust's investments. Any such contract shall be subject to the requirement
of the 1940 Act with respect to its continuance in effect, its termination and
the method of authorization and approval of such contract, or any amendment
thereto or renewal thereof.
Any Trustee or any organization with which any Trustee may be
associated also may act as broker for the Trust in making purchases and sales of
securities for or to the Trust for its investment portfolio, and may charge and
receive from the Trust the usual and customary commission for such service. Any
organization with which a Trustee may be associated in acting as broker for the
Trust shall be responsible only for the proper execution of transactions in
accordance with the instructions of the Trust and shall be subject to no further
liability of any sort whatever.
The Manager, or any affiliate thereof, also may be a
distributor for the sale of Interests by separate contract or may be a person
controlled by or affiliated with any Trustee or any distributor or a person in
which any Trustee or any distributor is interested financially, subject only to
applicable provisions of law. Nothing herein contained shall operate to prevent
any Manager, who also acts as such a distributor, from also receiving
compensation for services rendered as such distributor.
Section 6. Removal and Resignation of Trustees. The Trustees
--------- -----------------------------------
or the Interestholders (by vote of 66-2/3% of the outstanding Interests
entitled to vote thereon) may remove at any time any Trustee with or without
cause, and any Trustee may resign at any time as Trustee, without penalty by
written notice to the Trust; provided that sixty days' advance written notice
shall be given in the event that there are only three or fewer Trustees at the
time a notice of resignation is submitted.
Section 7. Additional Provisions. The By-Laws may include
--------- ---------------------
further provisions for Trustees' votes and meetings and related matters not
inconsistent with the provisions hereof.
ARTICLE V
Interestholders' Voting Powers and Meetings
Section 1. Voting Powers. The Interestholders shall have power
--------- -------------
to vote only (i) for the election of Trustees as provided in Article IV, Section
1, of this Declaration of Trust; provided, however, that no meeting of
-------- -------
Interestholders is required to be called for the purpose of electing Trustees
unless and until such time as less than a majority of the Trustees have been
elected by the Interestholders, (ii) for the removal of Trustees as provided in
Article IV, Section 6, (iii) with respect to any Manager as provided in Article
IV, Section 5, (iv) with respect to any amendment of this Declaration of Trust
as provided in Article X, Section 8, (v) with respect to the termination of the
Trust or a series of Interests as provided in Article X, Section 4, and (vi)
with respect to such additional matters relating to the Trust as may be required
by law, by this
15
Declaration of Trust, or the By-Laws of the Trust or any registration of the
Trust with the Commission or any state, or as the Trustees may consider
desirable. Each whole Interest shall be entitled to one vote as to any matter
on which it is entitled to vote (except that in the election of Trustees said
vote may be cast for as many persons as there are Trustees to be elected), and
each fractional Interest shall be entitled to a proportionate fractional vote.
Notwithstanding any other provision of this Declaration of Trust, on any
matter submitted to a vote of Interestholders, all Interests of the Trust then
entitled to vote shall be voted in the aggregate as a single class without
regard to series or classes of Interests, except (i) when required by the 1940
Act or when the Trustees shall have determined that the matter affects one or
more series or classes differently Interests shall be voted by individual
series or class and (ii) when the Trustees have determined that the matter
affects only the interests of one or more series or classes then only
Interestholders of such series or classes shall be entitled to vote thereon.
There shall be no cumulative voting in the election of Trustees. Interests may
be voted in person or by proxy. A proxy with respect to Interests held in the
name of two or more persons shall be valid if executed by any one of them,
unless at or prior to exercise of the proxy the Trust receives a specific
written notice to the contrary from any one of them. A proxy purporting to be
executed by or on behalf of a Interestholder shall be deemed valid unless
challenged at or prior to its exercise and the burden of proving invalidity
shall rest on the challenger. Whenever no Interests of any series or class are
issued and outstanding, the Trustees may exercise with respect to such series
or class all rights of Interestholders and may take any action required by
law, this Declaration of Trust or any By-Laws of the Trust to be taken by
Interestholders.
Section 2. Meetings. No annual or regular meeting of
--------- --------
Interestholders is required. Meetings of the Interestholders may be called by
the Trustees or such other person or persons as may be specified in the By-Laws
and shall be called by the Trustees upon the written request of Interestholders
owning at least 10% of the outstanding Interests entitled to vote.
Interestholders shall be entitled to at least ten days' prior notice of any
meeting.
Section 3. Quorum and Required Vote. Thirty percent (30%) of
--------- ------------------------
the outstanding Interests shall be a quorum for the transaction of business at
an Interestholders' meeting, except that where any provision of law or of
this Declaration of Trust permits or requires that holders of any series or
class shall vote as a series or class, then thirty percent (30%) of the
aggregate number of Interests of that series or class entitled to vote shall
be necessary to constitute a quorum for the transaction of business by that
series or class. Any lesser number, however, shall be sufficient for
adjournment and any adjourned session or sessions may be held within 90 days
after the date set for the original meeting without the necessity of further
notice. Except when a larger vote is required by any provision of this
Declaration of Trust or the By-Laws of the Trust and subject to any applicable
requirements of law, a majority of the Interests voted shall decide any
question, provided that where any provision of law or of this Declaration of
Trust permits or requires that the holders of any series or class shall vote
as a series or class, then a majority of the Interests of that series or class
voted on the matter shall decide that matter insofar as that series or class
is concerned.
16
Section 4. Action by Written Consent. Any action required or
--------- -------------------------
permitted to be taken at any meeting may be taken without a meeting if a consent
in writing, setting forth such action, is signed by a majority of
Interestholders entitled to vote on the subject matter thereof (or such larger
proportion thereof as shall be required by any express provision of this
Declaration of Trust) and such consent is filed with the records of the Trust.
Section 5. Additional Provisions. The By-Laws may include
--------- ---------------------
further provisions for Interestholders' votes and meetings and related matters.
ARTICLE VI
Allocations
Section 1. Net Income and Net Loss. For each day, Net Income
--------- -----------------------
or Net Loss of the Trust, if any, will be allocated among the Interestholders,
and credited or charged, as the case may be, to their Book Capital Accounts and
Tax Capital Accounts, in accordance with their Percentage Interests on such day.
Section 2. Book Sales Gain and Book Sales Loss. For each day,
--------- -----------------------------------
Book Sales Gain or Book Sales Loss of the Trust, if any, will be allocated among
the Interestholders, and credited or charged, as the case may be, to their Book
Capital Accounts, in accordance with their Percentage Interests on such day.
Section 3. Tax Sales Gain and Tax Sales Loss. For each day,
--------- ---------------------------------
Tax Sales Gain or Tax Sales Loss of the Trust, if any, will be allocated among
the Interestholders, and credited or charged, as the case may be, to their Tax
Capital Accounts, as follows:
(a) Tax Sales Gain will be allocated, first, to those
Interestholders with Positive Book/Tax Disparities in proportion to and to the
extent thereof, second, to the Interestholders in such manner so as to eliminate
as quickly as possible any difference between the ratio (expressed as a
percentage) of each Interestholder's Positive Tax/Book Disparity to the
aggregate Positive Tax/Book Disparities of all Interestholders and such
Interestholder's Percentage Interest, and, thereafter, to all Interestholders in
accordance with their Percentage Interests.
(a) Tax Sales Loss will be allocated, first, to those
Interestholders with Positive Tax/Book Disparities in proportion to and to the
extent thereof, second, to the Interestholders in such manner so as to eliminate
as quickly as possible any difference between the ratio (expressed as a
percentage) of each Interestholder's Positive Book/Tax Disparity to the
aggregate Positive Book/Tax Disparities of all Interestholders and such
Interestholder's Percentage Interest, and, thereafter, to all Interestholders in
accordance with their Percentage Interests.
Section 4. Remaining Built-in Gain and Remaining Built-in
--------- ----------------------------------------------
Loss. Whenever the Trust recognizes gain or loss for federal income tax purposes
----
from the sale
17
or other disposition of a Security, any Remaining Built-in Gain or
Remaining Built-in Loss with respect to such Security shall be allocated to the
Interestholder who contributed such Security to the Trust.
Section 5. Remaining Associated Gain and Remaining Appreciated
--------- ---------------------------------------------------
Loss.
----
(a) For purposes of computing an Interestholder's Positive
Book/Tax Disparity or Positive Tax/Book Disparity, such Interestholder's share
of Remaining Appreciated Gain or Remaining Appreciated Loss with respect to an
Appreciated Security or a Depreciated Security shall be determined by such
Interestholder's Percentage Interest on the day such Security became an
Appreciated Security or a Depreciated Security.
(b) Whenever the Trust recognizes gain or loss for federal
income tax purposes from the sale or other disposition of a Security, any
Remaining Appreciated Gain or Remaining Depreciated Loss with respect to such
Security shall be allocated to the Interestholders in accordance with their
Percentage Interests on the day such Security became an Appreciated Security or
a Depreciated Security.
Section 6. Distribution In-kind. Whenever the Trust makes an
--------- --------------------
in-kind distribution of a Security to an Interestholder, such Security shall be
treated for all purposes of this Agreement as sold for an amount equal to the
Gross Asset Value of such Security on the day of distribution.
Section 7. Code Section 754 Adjustment. Whenever an adjustment
--------- ---------------------------
to the Adjusted Basis of any Trust Security pursuant to Code Section 734(b) or
Code Section 743(b) is required pursuant to Regulations Section
1.704-1(b)(iv)(m) to be taken into account in determining capital accounts as
the result of a distribution to an Interestholder in complete liquidation of its
interest in the Trust, appropriate adjustments shall be Tax Capital Accounts
(and related items) of Interestholders to reflect such adjustment.
Any elections or other decisions relating to allocations under
this Section 4 shall be made by the Trustees in any manner that reasonably
reflects the purpose and intention of this Agreement. Allocations of Tax Sales
Gain, Tax Sales Loss, Remaining Built-in Gain, Remaining Built-in Loss,
Remaining Appreciated Gain and Remaining Depreciated Loss are solely for
purposes of federal, state and local taxes and shall not affect, or any way to
be taken into account, in computing any Interestholder's Book Capital Account or
share of Book Sales Gain and Book Sales Loss, other related items, or
distributions pursuant to any provisions of this Agreement.
18
ARTICLE VII
Distributions and Redemptions
Section 1. Distributions. The Trustees shall distribute
--------- -------------
periodically to the Interestholders of each series of Interests an amount
approximately equal to the net income of that series, determined by the Trustees
or as they may authorize and as herein provided. Distributions of income may be
made in one or more payments, which shall be in Interests, cash or otherwise,
and on a date or dates and as of a record date or dates determined by the
Trustees. At any time and from time to time in their discretion, the Trustees
also may cause to be distributed to the Interestholders of any one or more
series as of a record date or dates determined by the Trustees, in Interests,
cash or otherwise, all or part of any gains realized on the sale or disposition
of the assets of the series or all or part of any other principal of the Trust
attributable to the series. Each distribution pursuant to this Section 1 shall
be made ratably according to the number of Interests of the series held by the
several Interestholders on the record date for such distribution, except to the
extent otherwise required or permitted by the preferences and special or
relative rights and privileges of any classes of Interests of that series, and
any distribution to the Interestholders of a particular class of Interests shall
be made to such Interestholders pro rata in proportion to the number of
Interests of such class held by each of them. No distribution need be made on
Interests purchased pursuant to orders received, or for which payment is made,
after such time or times as the Trustees may determine.
Section 2. Determination of Net Income. In determining the net
--------- ---------------------------
income of each series or class of Interests for any period, there shall be
deducted from income for that period (a) such portion of all charges, taxes,
expenses and liabilities due or accrued as the Trustees shall consider properly
chargeable and fairly applicable to income for that period or any earlier period
and (b) whatever reasonable reserves the Trustees shall consider advisable for
possible future charges, taxes, expenses and liabilities which the Trustees
shall consider properly chargeable and fairly applicable to income for that
period or any earlier period. The net income of each series or class for any
period may be adjusted for amounts included on Account of net income in the net
asset value of Interests issued or redeemed or repurchased during that period.
In determining the net income of a series or class for a period ending on a date
other than the end of its fiscal year, income may be estimated as the Trustees
shall deem fair. Gains on the sale or disposition of assets shall not be treated
as income, and losses shall not be charged against income unless appropriate
under applicable accounting principles, except in the exercise of the
discretionary powers of the Trustees. Any amount contributed to the Trust which
is received as income pursuant to a decree of any court of competent
jurisdiction shall be applied as required by the said decree.
Section 3. Redemptions. Any Interestholder shall be entitled
--------- -----------
to require the Trust to redeem and the Trust shall be obligated to redeem at the
option of such Interestholder all or any part of the Interests owned by said
Interestholder, at the redemption price pursuant to the method, upon the terms
and subject to the conditions hereinafter set forth:
19
(a) Certificates for Interests, if issued, shall be presented
for redemption in proper form for transfer to the Trust or the agent of the
Trust appointed for such purpose, and these shall be presented with a written
request that the Trust redeem all or any part of the Interests represented
thereby.
(b) The redemption price per Interest shall be the net asset
value per Interest when next determined by the Trust at such time or times as
the Trustees shall designate, following the time of presentation of certificates
for Interests, if issued, and an appropriate request for redemption, or such
other time as the Trustees may designate in accordance with any provision of the
1940 Act, or any rule or regulation made or adopted by any securities
association registered under the Securities Exchange Act of 1934, as determined
by the Trustees, less any applicable charge or fee imposed from time to time as
determined by the Trustees.
(c) Net asset value of each Interests (for the purpose of
issuance of Interests as well as redemptions thereof) shall be determined by
dividing:
(i) the total value of the assets of such series or class
determined as provided in paragraph (d) below less, to the
extent determined by or pursuant to the direction of the
Trustees in accordance with generally accepted accounting
principles, all debts, obligations and liabilities of such
series or class (which debts, obligations and liabilities
shall include, without limitation of the generality of the
foregoing, any and all debts, obligations, liabilities, or
claims, of any and every kind and nature, fixed, accrued and
otherwise, including the estimated accrued expenses of
management and supervision, administration and distribution
and any reserves or charges for any or all of the foregoing,
whether for taxes, expenses, or otherwise, and the price of
Interests redeemed but not paid for) but excluding the
Trust's liability upon its Interests and its surplus, by
(ii) the total number of Interests of such series or class
outstanding.
The Trustees are empowered, in their absolute discretion, to
establish other methods for determining such net asset value whenever such other
methods are deemed by them to be necessary to enable the Trust to comply with
applicable law, or are deemed by them to be desirable, provided they are not
inconsistent with any provision of the 1940 Act.
(d) In determining for the purposes of this Declaration of
Trust the total value of the assets of each series or class of Interests at any
time, investments and any other assets of such series or class shall be valued
in such manner as may be determined from time to time by or pursuant to the
order of the Trustees.
(e) Payment of the redemption price by the Trust may be made
either in cash or in securities or other assets at the time owned by the Trust
or partly in cash and partly in securities or other assets at the time owned by
the Trust. The value of any part
20
of such payment to be made in securities or other assets of the Trust shall be
the value employed in determining the redemption price. Payment of the
redemption price shall be made on or before the seventh day following the day
on which the Interests are properly presented for redemption hereunder, except
that delivery of any securities included in any such payment shall be made as
promptly as any necessary transfers on the books of the issuers whose
securities are to be delivered may be made and, except as postponement of the
date of payment may be permissible under the 1940 Act.
Pursuant to resolution of the Trustees, the Trust may deduct
from the payment made for any Interests redeemed a liquidating charge not in
excess of an amount determined by the Trustees from time to time.
(f) The right of any holder of Interests redeemed by the Trust
as provided in this Article VII to receive dividends or distributions thereon
and all other rights of such Interestholder with respect to such Interests shall
terminate at the time as of which the redemption price of such Interests is
determined, except the right of such Interestholder to receive (i) the
redemption price of such Interests from the Trust in accordance with the
provisions hereof, and (ii) any dividend or distribution to which such
Interestholder previously had become entitled as the record holder of such
Interests on the record date for such dividend or distribution.
(g) Redemption of Interests by the Trust is conditional upon
the Trust having funds or other assets legally available therefor.
(h) The Trust, either directly or through an agent, may
repurchase its Interests, out of funds legally available therefor, upon such
terms and conditions and for such consideration as the Trustees shall deem
advisable, by agreement with the owner at a price not exceeding the net asset
value per Interest as determined by or pursuant to the order of the Trustees at
such time or times as the Trustees shall designate, less any applicable charge,
if and as fixed by the Trustees from time to time, and to take all other steps
deemed necessary or advisable in connection therewith.
(i) Interests purchased or redeemed by the Trust shall be
cancelled or held by the Trust for reissue, as the Trustees from time to time
may determine.
(j) The obligations set forth in this Article VII may be
suspended or postponed, (1) for any period (i) during which the New York Stock
Exchange is closed other than for customary weekend and holiday closings, or
(ii) during which trading on the New York Stock Exchange is restricted, (2) for
any period during which an emergency exists as a result of which (i) the
disposal by the Trust of investments owned by it is not reasonably practicable,
or (ii) it is not reasonably practicable for the Trust fairly to determine the
value of its net assets, or (3) for such other periods as the Commission or any
successor governmental authority by order may permit.
21
(k) Interestholders of a series of the Trust shall not be
liable for obligations of such series arising from conduct on a date or dates
after the date on which they have redeemed their shares of that series of the
Trust.
Notwithstanding any other provision of this Section 3 of
Article VII, if certificates representing such Interests have been issued, the
redemption or repurchase price need not be paid by the Trust until such
certificates are presented in proper form for i transfer to the Trust or the
agent of the Trust appointed for such purpose; however, the redemption or
repurchase shall be effective, in accordance with the resolution of the
Trustees, regardless of whether or not such presentation has been made.
Section 4. Redemptions at the Option of the Trust. The Trust
--------- --------------------------------------
shall have the right at its option and at any time to redeem Interests of any
Interestholder at the net asset value thereof as determined in accordance with
Section 3 of Article VII of this Declaration of Trusts (i) if at such time such
Interestholder owns fewer Interests than, or Interests having an aggregate net
asset value of less than, an amount determined from time to time by the
Trustees; or (ii) to the extent that such Interestholder owns Interests of a
particular series or class of Interests equal to or in excess of a percentage of
the outstanding Interests of that series or class determined from time to time
by the Trustees; or (iii) to the extent that such Interestholder owns Interests
of the Trust representing a percentage equal to or in excess of such percentage
of the aggregate number of outstanding Interests of the Trust or the aggregate
net asset value of the Trust determined from time to time by the Trustees.
Section 5. Dividends, Distributions. Redemptions and
--------- ------------------------
Repurchases. No dividend or distribution (including, without limitation, any
distribution paid upon termination of the Trust or of any series) with respect
to, nor any redemption or repurchase of, the Interests of any series shall be
effected by the Trust other than from the assets of such series
ARTICLE VIII
Compensation and Limitation of
Liability of Trustees
Section 1. Compensation. The Trustees shall be entitled to
--------- ------------
reasonable compensation from the Trust and may fix the amount of their
compensation.
Section 2. Limitation of Liability. A Trustee, when acting in
--------- -----------------------
such capacity, shall not be personally liable to any person other than the Trust
or an Interestholder for any act, omission or obligation of the Trust or any
Trustee. The Trustees shall not be responsible or liable to the Trust or an
Interestholder in any event for any neglect or wrongdoing of any officer, agent,
employee or Manager of the Trust, nor shall any Trustee be responsible for the
act or omission of any other Trustee, but nothing herein contained shall protect
any Trustee against any liability to the Trust or an Interestholder to which he
would otherwise be subject by reason of willful misfeasance,
22
bad faith, gross negligence or reckless disregard of the duties involved in
the conduct of his office.
Every note, bond, contract, instrument, certificate, share, or
undertaking and every other act or thing whatsoever executed or done by or on
behalf of the Trust or the Trustees or any of them in connection with the Trust,
shall be deemed conclusively to have been executed or done only in their or his
capacity as Trustees or Trustee, and such Trustees or Trustee shall not be
personally liable thereon.
ARTICLE IX
Indemnification
Section 1. Indemnification of Trustees, Officers. Employees
--------- -------------------------------------
and Agents. Each person who is or was a Trustee, officer, employee or agent of
the Trust or who serves or has served at the Trust's request as a director,
officer or trustee of another person in which the Trust has or had any interest
as a shareholder, creditor or otherwise shall be entitled to indemnification out
of the assets of the Trust to the extent provided in, and subject to the
provisions of, the By-Lows, provided that no indemnification shall be granted by
the Trust in contravention of the 1940 Act.
Section 2. Merged Persons. For the purposes of this Article
--------- --------------
VIII references to "the Trust" include any constituent person (including any
constituent of a constituent) absorbed in a consolidation or merger which, if
its separate existence had continued, would have had power and authority to
indemnify its directors, trustees, officers, employees or agents as well as the
resulting or surviving person; so that any person who is or was a director,
trustee, officer, employee or agent of such a constituent person or is or was
serving at the request of such a constituent person as a trustee, director,
officer, employee or agent of another person shall stand in the same position
under the provisions of this Article IX with respect to the resulting or
surviving person as he would have with respect to such a constituent person if
its separate existence had continued.
Section 3. Interestholders. In case any Interestholder or
--------- ---------------
former Interestholder shall be held to be personally liable solely by reason of
his being or having been an Interestholder and not because of his acts or
omissions or for some other reason, the Interestholder or former Interestholder
(or his heirs, executors, administrators or other legal representatives or in
the case of a corporation or other entity, its corporate or other general
successor) shall be entitled out of the assets of the particular series of
Interests of which he is or was an Interestholder to be held harmless from and
indemnified against all losses and expenses arising from such liability. Upon
request, the Trust shall cause its counsel to assume the defense of any claim
which, if successful, would result in an obligation of the Trust to indemnify
the Interestholder as aforesaid.
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ARTICLE X
Other General Provisions
Section 1. Trustee's Good Faith Action, Expert Advice, No
--------- ----------------------------------------------
Bond or Surety. The exercise by the Trustees of their powers and discretion
--------------
hereunder under the circumstances then prevailing, shall be binding upon
everyone interested. Subject to Article VIII, Section 2 hereof, a Trustee shall
be liable for his or her own willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of the office of
Trustee, and for nothing else, and shall not be liable for errors of judgment or
mistakes of fact or law. The Trustees may take advice of counsel or other
experts with respect to the meaning and operation of this Declaration of Trust,
and subject to the provisions of Section 2 of Article VIII shall be under no
liability for any act or omission in accordance with such advice or for failing
to follow such advice. The Trustees shall not be required to give any bond as
such, nor any surety if a bond is required.
Section 2. Liability of Third Persons Dealing with Trustees.
--------- ------------------------------------------------
No person dealing with the Trustees shall be bound to make any inquiry
concerning the validity of any transaction made or to be made by the Trustees
pursuant hereto or to see to the application of any payments made or property
transferred to the Trust or upon its order.
Section 3. Trustees, Officers, etc. Not Personally Liable:
--------- ----------------------------------------------
Notice. All persons extending credit to, contracting with or having any claim
------
against the Trust or a particular series of Interests shall look only to the
assets of the Trust or the assets and the Interestholders of that particular
series of Interests for payment under such credit, contract or claim; and
neither the Trustees nor any of the Trust's officers, employees or agents,
whether past, present or future, shall be personally liable therefor. Every
note, bond, contract or other undertaking issued by or on behalf of a particular
series shall include a recitation limiting the obligation represented thereby to
that series and its assets.
Section 4. Termination of Trust. Unless terminated as provided
--------- --------------------
herein, the Trust shall continue without limitation of time. The Trust may be
terminated at any time by vote of Interestholders holding at least a majority of
the Interests of each series entitled to vote or by the Trustees by written
notice to the Interestholders. Any series of Interests may be terminated at any
time by vote of Interestholders holding at least a majority of the Interests of
such series entitled to vote or by the Trustees by written notice to the
Interestholders of such series.
Upon termination of the Trust or of any one or more series of
Interests, after paying or otherwise providing for all charges, taxes, expenses
and liabilities, whether due or accrued or anticipated as may be determined by
the Trustees, the Trust shall reduce, in accordance with such procedures as the
Trustees consider appropriate, the remaining assets to distributable form in
cash or shares or other securities, or any combination thereof, and distribute
the proceeds to the Interestholders of the series involved, ratably according to
the number of Interests of such series held by the several
24
Interestholders of such series on the date of termination, except to the
extent otherwise required or permitted by the preferences and special or
relative rights and privileges of any classes of Interests of that series,
provided that any distribution to the Interestholders of a particular class of
Interests shall be made to such Interestholders pro rata in proportion to the
number of Interests of such class held by each of them.
Upon termination of the Trust, following completion of winding
up of its business, the Trustees shall cause a certificate of cancellation of
the Trust's certificate of trust to be filed in accordance with Section 3810 of
the Delaware Act, which certificate of cancellation may be signed by any one
Trustee.
Section 5. Termination Upon Bankruptcy of a Interestholder.
--------- -----------------------------------------------
Upon the bankruptcy of any Interestholder of a series of the Trust, such series
of the Trust shall be terminated effective 120 days after the event. However,
the Interestholders of that series of the Trust (other than such bankrupt
Interestholder) may, by a unanimous affirmative vote at any meeting of such
Interestholders or by an instrument in writing without a meeting executed by a
majority of the Trustees and consented to by all such Interestholders, agree to
continue the business of such series of the Trust even if there has been such an
event.
Section 6. Filing of Copies References, Headings. The initial
--------- -------------------------------------
Trustees shall file a certificate of Trust of the Trust with the Secretary of
State of the State of Delaware in accordance with Section 3810 of the Delaware
Act. The original or a copy of this instrument and of each amendment hereto and
of each Declaration of Trust supplemental hereto shall be kept at the office of
the Trust where it may be inspected by any Interestholder. Anyone dealing with
the Trust may rely on a certificate by an officer of the Trust as to whether or
not any such amendments or supplemental Declarations of Trust have been made and
as to matters in connection with the Trust hereunder; and, with the same effect
as if it were the original, may rely on a copy certified by an officer of the
Trust to be a copy of this instrument or of any such amendment or supplemental
Declaration of Trust. In this instrument or in any such amendment or
supplemental Declaration of Trust, references to this instrument, and all
expressions like "herein," "hereof," and "hereunder," shall be deemed to refer
to this instrument as amended or affected by any such amendment or supplemental
Declaration of Trust. Headings are placed herein for convenience of reference
only and in case of any conflict, the text of this instrument, rather than the
headings, shall control. This instrument may be executed in any number of
counterparts each of which shall be deemed an original.
Section 7. Applicable Law. This Declaration of Trust shall be
--------- --------------
governed by and construed in accordance with the laws of the State of Delaware.
The trust created hereby shall be a business trust created under, And subject to
the provisions of, the Delaware Act and may exercise all powers which are
ordinarily exercised by such a trust under the Delaware Act; provided, however,
that there shall not be applicable to the Trust, the Trustees or this
Declaration of Trust (a) the provisions of Section 3540 of Title 12 of the
Delaware Code or (b) any provisions of the laws (statutory or common) of the
State of Delaware (other than the Delaware Act) pertaining to trusts which are
inconsistent with the rights, duties, powers, limitations or liabilities of the
Trustees set forth or referenced in this Declaration of Trust.
Section 8. Amendments. Except as specifically provided
--------- ----------
herein, the Trustees may, without Interestholder vote, amend or to otherwise
supplement this Declaration of Trust by an instrument in writing signed by a
majority of the Trustees; provided, however, the Interestholders shall have the
right to vote (a) on any amendment which would affect their right to
25
vote granted in Section 1 of Article V hereof, (b) on any amendment to this
Section, (c) on any amendment as may be required by the 1940 Act and (d) on
any amendment submitted to them by the Trustees. Any amendment required or
permitted to be submitted to the Interestholders which, as the Trustees
determine, shall affect the Interestholders of one or more series shall be
authorized by vote of the Interestholders of each series affected and no vote
of Interestholders of a series not affected shall be required.
Section 9. Reorganization. Notwithstanding anything else
--------- --------------
herein, the Trustees, in order to change the form of organization of the Trust,
may, without Interestholder approval, (a) cause the Trust to merge or
consolidate with or into one or more trusts, partnerships, associations or
corporations so long as the surviving or resulting entity is an investment
company under the 1940 Act, or is a series thereof, or (b) cause the Trust or R
any series thereof to incorporate under the laws of the State of Delaware. Any
agreement of merger or consolidation or certificate of merger may be signed by a
majority of the Trustees and facsimile signatures conveyed by electronic or
telecommunication means shall be valid.
Pursuant to and in accordance with the provisions of Section
3815(f) of the Delaware Act, and notwithstanding anything else herein, an
agreement of merger or consolidation approved by the Trustees in accordance with
this Section may effect any amendment to this Declaration of Trust or effect the
adoption of a new declaration of trust of the Trust if it is the surviving or
resulting trust in the merger or consolidation.
Section 10. Sale of Assets. Notwithstanding anything else
---------- --------------
herein, the Trustees may, without Interestholder approval, sell and convey all
or substantially all of the assets of the Trust or any series to one or more
trusts, partnerships, associations or corporations so long as the transferee is
an investment company under the 1940 Act, or is a series thereof. Any sale shall
be for such consideration as the Trustees, in their absolute discretion, deem
adequate and may include the assumption of all outstanding obligations, taxes
and other liabilities, accrued or contingent, of the Trust or any series and may
include shares of beneficial interest, stock or other ownership interest of the
transferee or of a series thereof.
26
IN WITNESS WHEREOF, each of the undersigned Trustees has
hereunto his /her hand for himself/herself and his/her assigns as of the day and
year first above written.
/s/ Xxxx X. Xxxxxxx
-------------------
Xxxx X. Xxxxxxx
/s/ R. Xxxx Xxxxxx
------------------
R. Xxxx Xxxxxx
/s/ Xxxxxx X. Xxxx
------------------
Xxxxxx X. Xxxx
/s/ Zoe Xxx Xxxxx
-----------------
Zoe Xxx Xxxxx
/s/ W. Xxxxxx Xxxxxx
--------------------
W. Xxxxxx Xxxxxx
/s/ Xxxxxx X. Xxxxx
-------------------
Xxxxxx X. Xxxxx
/s/ X. Xxxxxx Xxxxx
-------------------
X. Xxxxxx Xxxxx
27
