1
EXHIBIT 2
BY-LAWS
OF
PRUDENTIAL DIVERSIFIED SERIES
2
TABLE OF CONTENTS
Page
ARTICLE I - AGREEMENT AND DECLARATION OF TRUST ........................... 1
Section 1. Agreement and Declaration
of Trust ............................................. 1
Section 2. Definitions ............................................ 1
ARTICLE II - OFFICES ..................................................... 1
Section 1. Principal Office ....................................... 1
Section 2. Registered Office and Other Office ..................... 1
ARTICLE III - SHAREHOLDERS ............................................... 1
Section 1. Meetings ............................................... 1
Section 2. Notice of Meetings ..................................... 2
Section 3. Record Date for Meetings ............................... 2
Section 4. Proxies ................................................ 2
Section 5. Inspection of Books .................................... 3
Section 6. Action without Meeting ................................. 3
Section 7. Application of this Article ............................ 4
ARTICLE IV - TRUSTEES .................................................... 4
Section 1. Meetings of the Trustees ............................... 4
Section 2. Quorum and Manner of Acting ............................ 5
ARTICLE V - COMMITTEES ................................................... 5
Section 1. Executive and Other Committees ......................... 5
Section 2. Meetings, Quorum and Xxxxxx of Acting .................. 5
ARTICLE VI - OFFICERS .................................................... 6
Section 1. General Provisions ..................................... 6
Section 2. Term of Office and Qualifications ...................... 6
Section 3. Removal ................................................ 6
Section 4. Xxxxxx and Duties of the Chairman ...................... 6
Section 5. Xxxxxx and Duties of the President ..................... 7
Section 6. Xxxxxx and Duties of the Vice
President ............................................ 7
Section 7. Powers and Duties of the Treasurer ..................... 7
Section 8. Xxxxxx and Duties of the Secretary ..................... 8
Section 9. Powers and Duties of Assistant
Treasurers ........................................... 8
Section 10. Powers and Duties of Assistant
Secretaries .......................................... 8
Section 11. Compensation of Officers and
Trustees ........................................ 8
ARTICLE VII - FISCAL YEAR ................................................ 9
(i)
3
ARTICLE VIII - SEAL ..................................................... 9
ARTICLE IX - WAIVERS OF NOTICE .......................................... 9
ARTICLE X - CUSTODY OF SECURITIES ....................................... 9
Section 1. Employment of a Custodian .............................. 9
Section 2. Action upon Termination of Custodian Agreement ......... 9
Section 3. Provisions of Custodian Contract ....................... 10
Section 4. Central Certificate System ............................. 10
ARTICLE XI - INDEMNIFICATION OF TRUSTEES, OFFICERS, EMPLOYEES AND
OTHER AGENTS ............................................... 11
Section 1. Agents, Proceedings, Expenses .......................... 11
Section 2. Indemnification ........................................ 11
Section 3. Limitations, Settlements ............................... 11
Section 4. Insurance, Rights Not Exclusive ........................ 12
Section 5. Advance of Expenses .................................... 12
Section 6. Fiduciaries of Employee Benefit Plan ................... 13
ARTICLE XII - AMENDMENTS ................................................ 13
(ii)
4
BY-LAWS
OF
PRUDENTIAL DIVERSIFIED SERIES
ARTICLE I
Agreement and Declaration of Trust
Section 1. Agreement and Declaration of Trust. These By-Laws shall be
subject to the Agreement and Declaration of Trust, as from time to time
amended, supplemented or restated (the "Declaration of Trust") of Prudential
Diversified Series (the "Trust").
Section 2. Definitions. Unless otherwise defined herein, the terms used
herein have the respective meanings given them in the Declaration of Trust.
ARTICLE II
Offices
Section 1. Principal Office. The principal office of the Trust shall be
located in the City of Newark, State of New Jersey, or such other location as
the Trustees may from time to time determine. Section 2. Registered Office
and Other Offices. The registered office of the Trust shall be located in the
City of Wilmington, State of Delaware or such other location within the State
of Delaware as the Trustees may from time to time determine. The Trust may
establish and maintain such other offices and places of business as the
Trustees may from time to time determine.
ARTICLE III
Shareholders
Section 1. Meetings. Meetings of the Shareholders shall be held at the
principal executive offices of the Trust or at such other place within the
United States of America as the Trustees shall designate. Meetings of the
Shareholders shall be called by the Secretary whenever (i) ordered by the
Trustees or (ii) for the purpose of voting on the removal of any Trustee,
requested in writing by Shareholders holding at least ten percent (10%) of
the outstanding Shares entitled to vote. If the Secretary, when so ordered or
requested, refuses or neglects for more than 10 days to call such meetings,
the Trustees or the
5
Shareholders so requesting, may, in the name of the Secretary, call the meeting
by giving notice thereof in the manner required when notice is given by the
Secretary.
Section 2. Notice of Meetings. Except as otherwise herein provided,
notice of all meetings of the Shareholders, stating the time, place and
purposes of the meeting, shall be given by the Secretary by delivering or
mailing, postage prepaid, to each Shareholder entitled to vote at said
meeting at his or her address as recorded on the register of the Trust at
least ten (10) days and not more than ninety (90) days before the meeting.
Only the business stated in the notice of the meeting shall be considered at
such meeting. Notice of adjournment of a Shareholders' meeting to another
time or place need not be given, if such time and place are announced at the
meeting and the adjourned meeting is held within a reasonable time after the
date set for the original meeting. No notice need be given to any Shareholder
who shall have failed to inform the Trust of his or her current address or if
a written waiver of notice, executed before or after the meeting by the
Shareholder or his or her attorney thereunto authorized, is filed with the
records of the meeting.
Section 3. Record Date for Meetings. For the purpose of determining the
Shareholders who are entitled to notice of and to vote at any meeting, the
Trustees may from time to time close the transfer books for such period, not
exceeding thirty (30) days, as the Trustees may determine; or without closing
the transfer books the Trustees may fix a date not more than ninety (90) days
prior to the date of any meeting of Shareholders as a record date for the
determination of the persons to be treated as Shareholders of record for such
purpose.
Section 4. Proxies. At any meeting of Shareholders, any holder of Shares
entitled to vote thereat may vote either in person or by written proxy signed
by the Shareholder, provided that no proxy shall be voted at any meeting
unless it shall have been placed on file with the Secretary, or with such
other officer or agent of the Trust as the Secretary may direct, for
verification prior to the time at which such vote shall be taken; provided,
however, that notwithstanding any other provision of this Section 4 to the
contrary, the Trustees may at any time adopt one or more electronic,
telecommunication, telephonic, computerized or other alternatives to
execution of a written instrument that will enable holders of Shares entitled
to vote at any meeting to appoint a proxy to vote such holders' Shares at
such meeting. Proxies may be solicited in
2
6
the name of one or more Trustees or one or more of the officers of the Trust.
Only Shareholders of record shall be entitled to vote. When any Share is held
jointly by several persons, any one of them may vote at any meeting in person or
by proxy in respect of such Share, but if more than one of them shall be present
at such meeting in person or by proxy, and such joint owners or their proxies so
present disagree as to any vote to be cast, such vote shall not be received in
respect of such Share. A proxy purporting to be executed by or on behalf of a
Shareholder shall be deemed valid unless challenged at or prior to its exercise,
and the burden of proving invalidity shall rest on the challenger. If the holder
of any such Share is a minor or a person of unsound mind, and subject to
guardianship or the legal control of any other person as regards the charge or
management of such Share, he or she may vote by his or her guardian or such
other person appointed or having such control, and such vote may be given in
person or by proxy. At all meetings of the Shareholders, unless the voting is
conducted by inspectors, all questions relating to the qualifications of voters,
the validity of proxies, and the acceptance or rejection of votes shall be
decided by the chairman of the meeting. Except as otherwise provided herein or
in the Declaration of Trust, all matters relating to the giving, voting or
validity of proxies shall be governed by the General Corporation Law of the
State of Delaware relating to proxies, and judicial interpretations thereunder,
as if the Trust were a Delaware corporation and the Shareholders were
shareholders of a Delaware corporation.
Section 5. Inspection of Books. The Trustees shall from time to time
determine whether and to what extent, and at what times and places, and under
what conditions and regulations the accounts and books of the Trust or any of
them shall be open to the inspection of the Shareholders; and no Shareholder
shall have any right to inspect any account or book or document of the Trust
except as conferred by law or otherwise by the Trustees or by resolution of
the Shareholders.
Section 6. Action Without Meeting. Any action that may be taken at any
meeting of Shareholders may be taken without a meeting and without prior
notice if a consent in writing setting forth the action so taken is signed by
the holders of outstanding Shares having not less than the minimum number of
votes that would be necessary to authorize or take that action at a meeting
at which all Shares entitled to vote on that action were present and voted.
All such consents shall be filed with the records of Shareholder meetings.
Such consents shall be treated for all purposes as a vote taken at a meeting
of Shareholders.
3
7
Section 7. Application of this Article. Meetings of Shareholders shall
consist of Shareholders of any Series (or Class thereof) or of all
Shareholders, as determined pursuant to the Declaration of Trust, and this
Article shall be construed accordingly.
ARTICLE IV
Trustees
Section 1. Meetings of the Trustees. The Trustees may in their discretion
provide for regular or stated meetings of the Trustees. Notice of regular or
stated meetings need not be given. Meetings of the Trustees other than regular
or stated meetings shall be held whenever called by the Chairman, the President,
or by any two of the Trustees, at the time being in office. Notice of the time
and place of each meeting other than regular or stated meetings shall be given
by the Secretary or an Assistant Secretary or by the officer or Trustees calling
the meeting and shall be delivered or mailed, postage prepaid, to each Trustee
at least two days before the meeting, or shall be telegraphed, cabled, or wired
to each Trustee at his or her business address, or personally delivered to him
or her, at least one day before the meeting. Such notice may, however, be waived
by any Trustees. Notice of a meeting need not be given to any Trustee if a
written waiver of notice, executed by him or her before or after the meeting, is
filed with the records of the meeting, or to any Trustee who attends the meeting
without protesting prior thereto or at its commencement the lack of notice to
him or her. A notice or waiver of notice need not specify the purpose of any
meeting. The Trustees may meet by means of a telephone conference circuit or
similar communications equipment by means of which all persons participating in
the meeting are connected, which meeting shall be deemed to have been held at a
place designated by the Trustees at the meeting. Participation in a telephone
conference meeting shall constitute presence in person at such meeting. Any
action required or permitted to be taken at any meeting of the Trustees may be
taken by the Trustees without a meeting if a majority of the Trustees then in
office (or such higher number of Trustees as would be required to act on the
matter under the Declaration of Trust, these By-Laws or applicable law if a
meeting were held) consent to the action in writing and the written consents are
filed with the records of the Trustees' meetings. Such consents shall be treated
for all purposes as a vote taken at a meeting of the
4
8
Trustees. Notwithstanding the foregoing, all actions of the Trustees shall be
taken in compliance with the provisions of the Investment Company Act of 1940,
as amended.
Section 2. Quorum and Xxxxxx of Acting. A majority of the Trustees then
in office shall constitute a quorum for the transaction of business. If at
any meeting of the Trustees there shall be less than a quorum present, a
majority of those present may adjourn the meeting from time to time until a
quorum shall be obtained. Notice of an adjourned meeting need not be given.
The act of the majority of the Trustees present at any meeting at which there
is a quorum shall be the act of the Trustees, except as may be otherwise
specifically provided by law or by the Declaration of Trust or by these
By-Laws.
ARTICLE V
Committees
Section 1. Executive and Other Committees. The Trustees by vote of a
majority of all the Trustees may elect from their own number an Executive
Committee to consist of not less than three (3) Trustees to hold office at
the pleasure of the Trustees, which shall have the power to conduct the
current and ordinary business of the Trust while the Trustees are not in
session, including the purchase and sale of securities and the designation of
securities to be delivered upon redemption of Shares of the Trust, and such
other powers of the Trustees as the Trustees may, from time to time, delegate
to them except those powers by law, the Declaration of Trust or these By-laws
they are prohibited from delegating. The Trustees may also elect from their
own number or otherwise other Committees from time to time, the number
composing such Committees, the powers conferred upon the same (subject to the
same limitations as with respect to the Executive Committee), the terms of
membership on such Committees and the termination or circumstances giving
rise to the termination of such Committees to be determined by the Trustees.
The Trustees may designate a chairman of any such Committee. In the absence
of such designation the Committee may elect its own chairman.
Section 2. Meetings, Quorum and Xxxxxx of Acting. The Trustees may (1)
provide for stated meetings of any Committees, (2) specify the manner of
calling and notice required for special meeting of any Committee, (3) specify
the number of members of a Committee required to constitute a quorum and the
numbers of members of a Committee required to exercise specified powers
delegated to such
5
9
Committee, (4) authorize the making of decisions to exercise specified powers by
written assent of the requisite number of members of a Committee without a
meeting, and (5) authorize the members of a Committee to meet by means of a
telephone conference circuit. Each Committee shall keep regular minutes of its
meetings and records of decisions taken without a meeting and cause them to be
recorded in a book designated for that purpose and kept at the principal
executive offices of the Trust.
ARTICLE VI
Officers
Section 1. General Provisions. The officers of the Trust shall be a
President, a Treasurer and a Secretary, who shall be elected by the
Trustees. The Trustees may elect or appoint such other officers or agents as
the business of the Trust may require, including a Chairman of the Board
("Chairman"), one or more Vice Presidents, one or more Assistant Secretaries,
and one or more Assistant Treasurers. The Trustees may delegate to any
officer or Committee the power to appoint any subordinate officers or agents.
Section 2. Term of Office and Qualifications. Except as otherwise
provided by law, the Declaration of Trust or these By-Laws, the President,
the Treasurer and the Secretary, and all other officers shall hold office at
the pleasure of the Trustees. The Secretary and Treasurer may be the same
person. A Vice President and the Treasurer or a Vice President and the
Secretary may be the same person, but the offices of Vice President,
Secretary and Treasurer shall not be held by the same person. The President
shall hold no other office, but may be a Trustee of the Trust. Except as
above provided, any two offices may be held by the same person. The Chairman,
if there be one, shall be a Trustee and may but need not be a Shareholder.
Any other officer may be but none need be a Trustee or Shareholder.
Section 3. Removal. The Trustees, at any regular or special meeting of
the Trustees, may remove any officer with or without cause, by a vote of a
majority of the Trustees then in office. Any officer or agent appointed by an
officer or committee may be removed with or without cause by such appointing
officer or committee.
Section 4. Xxxxxx and Duties of the Chairman. The Chairman, if such an
officer is elected, shall if present preside at meetings of the Shareholders
and the Trustees, shall be the chief executive officer of the Trust and
shall, subject to the control of the Trustees, have general supervision,
direction and control
6
10
of the business and the officers of the Trust and exercise and perform such
other powers and duties as may be from time to time assigned to him by the
Trustees or prescribed by the Declaration of Trust or these By-Laws.
Section 5. Xxxxxx and Duties of the President. Subject to the powers of
the Chairman, if there be such an officer, the President shall be the
principal executive officer of the Trust. He or she may call meetings of the
Trustees and of any Committee thereof when he or she deems it necessary and,
in the absence of the Chairman, shall preside at all meetings of the
Shareholders and the Trustees. Subject to the control of the Trustees, the
Chairman and any Committees of the Trustees, within their respective spheres,
as provided by the Trustees, the President shall at all times exercise a
general supervision and direction over the affairs of the Trust. The
President shall have the power to employ attorneys, accountants and other
advisers and agents for the Trust and to employ such subordinate officers,
agents, clerks and employees as he or she may find necessary to transact the
business of the Trust. He or she shall also have the power to grant, issue,
execute or sign such powers of attorney, proxies or other documents as may be
deemed advisable or necessary in furtherance of the interests of the Trust.
The President shall have such other powers and duties as from time to time
may be conferred upon or assigned to him or her by the Trustees.
Section 6. Xxxxxx and Duties of the Vice President. In the absence or
disability of the President, the Vice President or, if there be more than one
Vice President, any Vice President designated by the Trustees shall perform
all the duties and may exercise any of the powers of the President, subject
to the control of the Trustees. Each Vice President shall perform such other
duties as may be assigned to him or her from time to time by the Trustees or
the President.
Section 7. Powers and Duties of the Treasurer. The Treasurer shall be
the principal financial and accounting officer of the Trust. The Treasurer
shall deliver all funds of the Trust which may come into his or her hands to
such Custodian as the Trustees may employ pursuant to Article X of these
By-Laws. He or she shall render a statement of condition of the finances of
the Trust to the Trustee as often as they shall require the same and he or
she shall in general perform all the duties incident to the office of
Treasurer and such other duties as from time to time may be assigned to him
or her by the Trustees. The Treasurer
7
11
shall give a bond for the faithful discharge of his or her duties, if required
so to do by the Trustees, in such sum and with such surety or sureties as the
Trustees shall require.
Section 8. Xxxxxx and Duties of the Secretary. The Secretary shall keep
the minutes of all meetings of the Trustees and of the Shareholders in proper
books provided for that purpose; he or she shall have custody of the seal of
the Trust; he or she shall have charge of the Share transfer books, lists and
records unless the same are in the charge of the Transfer Agent. The
Secretary shall attend to the giving and serving of all notices by the Trust
in accordance with the provisions of these By-laws and as required by law;
and subject to these By-Laws, he or she shall in general perform all duties
incident to the office of the Secretary and such other duties as from time to
time may be assigned to him or her by the Trustees.
Section 9. Xxxxxx and Duties of Assistant Treasurers. In the absence or
disability of the Treasurer, any Assistant Treasurer designated by the
Trustees shall perform all the duties, and may exercise any of the powers, of
the Treasurer. Each Assistant Treasurer shall perform such other duties as
from time to time may be assigned to him or her by the Trustees. Each
Assistant Treasurer shall give a bond for the faithful discharge of his or
her duties, if required so to do by the Trustees, in such sum and with such
surety or sureties as the Trustees shall require.
Section 10. Powers and Duties of Assistant Secretaries. In the absence
or disability of the Secretary, any Assistant Secretary designated by the
Trustees shall perform all the duties, and may exercise any of the powers, of
the Secretary. Each Assistant Secretary shall perform such other duties as
from time to time may be assigned to him or her by the Trustees.
Section 11. Compensation of Officers and Trustees. Subject to any
applicable provisions of the Declaration of Trust, the compensation of the
officers and Trustees shall be fixed from time to time by the Trustees or, in
the case of officers, by any Committee or officer upon whom such power may be
conferred by the Trustees. No officer shall be prevented from receiving such
compensation as such officer by reason of the fact that he or she is also a
Trustee.
8
12
ARTICLE VII
Fiscal Year
The fiscal year of the Trust shall end on such date as the Trustees
shall from time to time determine.
ARTICLE VIII
Seal
The Trustees may adopt a seal which shall be in such form and shall
have such inscription thereon as the Trustees may from time to time prescribe.
ARTICLE IX
Waivers of Notice
Whenever any notice whatever is required to be given by law, the
Declaration of Trust or these By-laws, a waiver thereof in writing, signed by
the person or persons entitled to said notice, whether before or after the
time stated therein, shall be deemed equivalent thereto. A notice shall be
deemed to have been telegraphed, cabled or wired for the purposes of these
By-Laws when it has been delivered to a representative of any telegraph,
cable or wire company with instructions that it be telegraphed, cabled or
wired.
ARTICLE X
Custody of Securities
Section 1. Employment of a Custodian. The Trust shall place and at all
times maintain in the custody of a Custodian (including any sub-custodian for
the Custodian) all funds, securities and similar investments included in the
Trust Property. The Custodian (and any sub-custodian) shall be a bank having
not less than $20,000,000 aggregate capital, surplus and undivided profits
and shall be appointed from time to time by the Trustees, who shall fix its
remuneration.
Section 2. Action upon Termination of Custodian Agreement. Upon
termination of a Custodian Agreement or inability of the Custodian to
continue to serve, the Trustees shall promptly appoint a successor custodian,
but in the event that no successor custodian can be found who has the
required
9
13
qualifications and is willing to serve, the Trustees shall call as promptly as
possible a special meeting of the Shareholders to determine whether the Trust
shall function without a custodian or shall be liquidated. If so directed by a
vote of holders of the majority of the outstanding Shares entitled to vote, the
Custodian shall deliver and pay over all Trust Property held by it as specified
in such vote.
Section 3. Provisions of Custodian Contract. The following provisions
shall apply to the employment of a Custodian and to any contract entered into
with the Custodian so employed: The Trustees shall cause to be delivered to
the Custodian all securities included in the Trust Property or to which the
Trust may become entitled, and shall order the same to be delivered by the
Custodian only in completion of a sale, exchange, transfer, pledge, loan of
portfolio securities to another person, or other disposition thereof, all as
the Trustees may generally or from time to time require or approve or to a
successor Custodian; and the Trustees shall cause all funds included in the
Trust Property or to which it may become entitled to be paid to the
Custodian, and shall order the same disbursed only for investment against
delivery of the securities acquired (including securities acquired under a
repurchase agreement), or the return of cash held as collateral for loans of
portfolio securities, or in payment of expenses, including management
compensation, and liabilities of the Trust, including distributions to
Shareholders, or to a successor Custodian. Notwithstanding anything to the
contrary to these By-Laws, upon receipt of proper instructions, which may be
standing instructions, the Custodian may deliver funds in the following
cases: In connection with repurchase agreements, the Custodian shall transmit
prior to receipt on behalf of the Fund of any securities or other property,
funds from the Fund's custodian account to a special custodian approved by
the Trustees of the Fund, which funds shall be used to pay for securities to
be purchased by the Fund subject to the Fund's obligation to sell and the
seller's obligation to repurchase such securities (in such case, the
securities shall be held in the custody of the special custodian); in
connection with the Trust's purchase or sale of financial futures contracts,
the Custodian shall transmit, prior to receipt on behalf of the Fund of any
securities or other property, funds from the Trust's custodian account in
order to furnish and to maintain funds with brokers as margin to guarantee
the performance of the Trust's futures obligations in accordance with the
applicable requirements of commodities exchanges and brokers.
10
14
Section 4. Central Certificate System. Subject to applicable rules,
regulations and orders adopted by the Commission, the Trustees may direct the
Custodian to deposit all or any part of the securities owned by the Trust in
a system for the central handling of securities established by a national
securities exchange or a national securities association registered with the
Commission under the Securities Exchange Act of 1934, or such other person as
may be permitted by the Commission, or otherwise in accordance with the 1940
Act, pursuant to which system all securities of any particular class or
series of any issuer deposited within the system are treated as fungible and
may be transferred or pledged by bookkeeping entry without physical delivery
of such securities, provided that all such deposits shall be subject to
withdrawal only upon the order of the Trust.
ARTICLE XI
Indemnification of Trustees, Officers,
Employees and Other Agents
Section 1. Agents, Proceedings, Expenses. For the purpose of this
Article, "agent" means any Person who is or was a Trustee, officer, employee
or other agent of the Trust or is or was serving at the request of the Trust
as a trustee, director, officer, employee or agent of another organization in
which the Trust has any interest as a shareholder, creditor or otherwise;
"proceeding" means any threatened, pending or completed claim, action, suit
or proceeding, whether civil, criminal, administrative or investigative
(including appeals); and "expenses" includes, without limitation, attorneys'
fees, costs, judgments, amounts paid in settlement, fines, penalties and all
other liabilities whatsoever.
Section 2. Indemnification. Subject to the exceptions and limitation
contained in Section 3 below, every agent shall be indemnified by the Trust
to the fullest extent permitted by law against all liabilities and against
all expenses reasonably incurred or paid by him or her in connection with any
proceeding in which he or she becomes involved as a party or otherwise by
virtue of his or her being or having been an agent.
Section 3. Limitations, Settlements. No indemnification shall be
provided hereunder to an agent:
(a) who shall have been adjudicated by the court or other body before
which the proceeding was brought to be liable to the Trust or its Shareholders
by reason of willful misfeasance, bad faith, gross
11
15
negligence or reckless disregard of the duties involved in the conduct of his or
her office (collectively, "disabling conduct"); or
(b) with respect to any proceeding disposed of (whether by settlement,
pursuant to a consent decree or otherwise) without an adjudication by the
court or other body before which the proceeding was brought that such agent
was liable to the Trust or its Shareholders by reason of disabling conduct,
unless there has been a determination that such agent did not engage in
disabling conduct:
(i) by the court or other body before which the proceeding was brought;
(ii) by at least a majority of those Trustees who are neither
Interested Persons of the Trust nor are parties to the proceeding based upon
a review of readily available facts (as opposed to a full trial-type
inquiry); or
(iii) by written opinion of independent legal counsel based upon a
review of readily available facts (as opposed to a full trial-type inquiry);
provided, however, that indemnification shall be provided hereunder to an
agent with respect to any proceeding in the event of (1) a final decision on
the merits by the court or other body before which the proceeding was brought
that the agent was not liable by reason of disabling conduct, or (2) the
dismissal of the proceeding by the court or other body before which it was
brought for insufficiency of evidence of any disabling conduct with which
such agent has been charged.
Section 4. Insurance, Rights Not Exclusive. The rights of
indemnification herein provided may be insured against by policies maintained
by the Trust on behalf of any agent, shall be severable, shall not be
exclusive of or affect any other rights to which any agent may now or
hereafter be entitled and shall inure to the benefit of the heirs, executors
and administrators of any agent.
Section 5. Advance of Expenses. Expenses incurred by an agent in
connection with the preparation and presentation of a defense to any
proceeding may be paid by the Trust from time to time prior to final
disposition thereof upon receipt of an undertaking by or on behalf of such
agent that such amount will be paid over by him or her to the Trust if it is
ultimately determined that he or she is not entitled to indemnification under
this Article XI; provided, however, that (a) such agent shall have provided
appropriate security for such undertaking, (b) the Trust is insured against
losses arising out of any such advance payments or (c) either a majority of
the Trustees who are neither Interested Persons of
12
16
the Trust nor parties to the proceedings, or independent legal counsel in a
written opinion, shall have determined, based upon a review of readily available
facts (as opposed to a trial-type inquiry or full investigation), that there is
reason to believe that such agent will be found entitled to indemnification
under this Article XI.
Section 6. Fiduciaries of Employee Benefit Plan. The Article does not
apply to any proceeding against any Trustee, investment manager or other
fiduciary of an employee benefit plan in that person's capacity as such, even
though that person may also be an agent of this Trust as defined in Section 1
of this Article. Nothing contained in this Article shall limit any right to
indemnification to which such Trustee, investment manager, or other fiduciary
may be entitled by contract or otherwise which shall be enforceable to the
extent permitted by applicable law other than this Article.
ARTICLE XII
Amendments
These By-Laws, or any of them, may be altered, amended or repealed, or
new By-laws may be adopted by (a) a vote of holders of the majority of the
outstanding Shares entitled to vote or (b) by the Trustees, provided,
however, that no By-law may be amended, adopted or repealed by the Trustees
if such amendment, adoption or repeal is required by applicable law, the
Declaration of Trust or these By-Laws, to be submitted to a vote of the
Shareholders.
13
