Exhibit (a)
ADVANTAGE ADVISERS MULTI-SECTOR FUND I
(A Delaware Business Trust)
SECOND AMENDED AND RESTATED
AGREEMENT AND DECLARATION OF TRUST
Dated as of March 26, 2002
ADVANTAGE ADVISERS MULTI-SECTOR FUND I
SECOND AMENDED AND RESTATED AGREEMENT AND DECLARATION OF TRUST
SECOND AMENDED AND RESTATED AGREEMENT AND DECLARATION OF TRUST made
as of the 26th day of March 2002, by the Trustees hereunder, and by the
holders of Shares issued hereunder as hereinafter provided.
WHEREAS, this Trust has been formed to carry on business as set forth
more particularly hereinafter;
WHEREAS, this Trust is authorized to issue an unlimited number of its
Shares all in accordance with the provisions hereinafter set forth;
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; and
WHEREAS, the parties hereto intend that the Trust created by this
Declaration and the Certificate of Trust filed with the Secretary of State of
the State of Delaware on August 14, 2001 shall constitute a business trust
under the Delaware Business Trust Act and that this Declaration shall
constitute the governing instrument of such business trust.
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 benefit of the holders from
time to time of shares of beneficial interest in this Trust as hereinafter set
forth.
ARTICLE I
The Trust
1.1 Name. This Trust shall be known as the "Advantage Advisers
Multi-Sector Fund I" and the Trustees shall conduct the business of the Trust
under that name or any other name or names as they may from time to time
determine.
1.2 Definitions. As used in this Declaration, the following terms
shall have the following meanings:
"1940 Act" refers to the Investment Company Act of 1940 and the rules
and regulations promulgated thereunder and exemptions granted therefrom, as
amended from time to time.
"Advisers Act" refers to the Investment Advisers Act of 1940 and the
rules and regulations promulgated thereunder and exemptions granted therefrom,
as amended from time to time.
The term "Interested Person" shall have the meaning given to it in
the 1940 Act.
"By-Laws" shall mean the By-Laws of the Trust, as amended from time
to time by the Trustees.
"Chairman" refers to the Chairman of the Board of Trustees, if any.
"Code" shall mean the Internal Revenue Code of 1986, as amended, and
the regulations promulgated thereunder.
"Commission" shall mean the Securities and Exchange Commission.
"Declaration" shall mean this Amended and Restated Agreement and
Declaration of Trust, as amended or amended and restated from time to time.
"Delaware Business Trust Act" shall mean the provisions of the
Delaware Business Trust Act, 12 Del. C.ss.3801, et. seq., as such Act may be
amended from time to time.
"Delaware General Corporation Law" means the Delaware General
Corporation Law, 8 Del. C.ss.100, et. seq., as amended from time to time.
"Exchange Act" refers to the Securities Exchange Act of 1934 and the
rules and regulations promulgated thereunder and exemptions granted therefrom,
as amended from time to time.
"Fundamental Policies" shall mean the investment policies and
restrictions as set forth from time to time in any Prospectus or contained in
any current Registration Statement of the Trust filed with the Commission or
as otherwise adopted by the Trustees and the Shareholders in accordance with
the requirements of the 1940 Act and designated as fundamental policies
therein, as they may be amended from time to time in accordance with the
requirements of the 1940 Act.
"Majority Shareholder Vote" shall mean a vote of "a majority of the
outstanding voting securities" (as such term is defined in the 0000 Xxx) of
the Trust with each class voting together (except where the classes are
required to vote separately by the 1940 Act or other applicable law).
"Person" shall mean and include individuals, corporations,
partnerships, trusts, limited liability companies, associations, joint
ventures and other entities, whether or not legal entities, and governments
and agencies and political subdivisions thereof.
"Prospectus" shall mean the Prospectus of the Trust, if any, as in
effect from time to time under the Securities Act of 1933, as amended.
"Securities Act" refers to the Securities Act of 1933 and the rules
and regulations promulgated thereunder and exemptions granted therefrom, as
amended from time to time.
"Shareholders" shall mean, as of any particular time, the holders of
record of outstanding Shares at such time.
"Shares" shall mean the transferable units of beneficial interest
into which the beneficial interest in the Trust shall be divided from time to
time and includes fractions of Shares as well as whole Shares. All references
to Shares shall be deemed to be Shares of any or all series or classes as the
context may require.
"Trust" shall mean the trust established by this Declaration, as
amended from time to time, inclusive of each such amendment.
"Trust Property" shall mean as of any particular time any and all
property, real or personal, tangible or intangible, which at such time is
owned or held by or for the account of the Trust or the Trustees in such
capacity.
"Trustees" shall mean the signatories to this Declaration so long as
they shall continue in office in accordance with the terms hereof, and all
other persons who at the time in question have been duly elected or appointed
and have qualified as trustees in accordance with the provisions hereof and
are then in office.
ARTICLE II
Trustees
2.1 Number and Qualification. Prior to a public offering of Shares,
there may be a sole Trustee. Thereafter, the number of Trustees shall be
determined by a written instrument signed by a majority of the Trustees then
in office; provided that the number of Trustees shall be no less than two or
more than nine. No reduction in the number of Trustees shall have the effect
of removing any Trustee from office prior to the expiration of his term. An
individual nominated as a Trustee shall be at least 21 years of age and not
older than 80 years of age at the time of nomination and not under legal
disability. Trustees need not own Shares and may succeed themselves in office.
2.2 Term and Election. The number of the Trustees shall be determined
by resolution of the Board of Trustees. The term of office of all of the
Trustees shall expire on the date of the first annual meeting of Shareholders
following the effective date of the Registration Statement relating to the
Shares under the Securities Act of 1933, as amended; thereafter, the term of
office of all of the Trustees shall expire on the date of each successive
annual meeting or special meeting in lieu thereof called for the purpose of
electing all Trustees. Except as provided in Sections 2.3 or 2.4, the Trustees
shall be elected at an annual meeting of the Shareholders or special meeting
in lieu thereof called for the purpose, and each Trustee elected shall hold
office until his or her successor shall have been elected and shall have
qualified.
2.3 Resignation and Removal. Any of the Trustees may resign their
trust (without need for prior or subsequent accounting) by an instrument in
writing signed by such Trustee and delivered or mailed to the Trustees or the
Chairman, if any, the President or the Secretary and such resignation shall be
effective upon such delivery, or at a later date according to the terms of the
instrument. Any of the Trustees may be removed (provided the aggregate number
of Trustees after such removal shall not be less than the minimum number
required by Section 2.1 hereof) for cause only, and not without cause, and
only by action taken by a majority of the remaining Trustees followed by
consent of the holders of at least seventy-five percent (75%) of the Shares
then entitled to vote in an election of such Trustee. Upon the resignation or
removal of a Trustee, each such resigning or removed Trustee shall execute and
deliver such documents as the remaining Trustees shall require for the purpose
of conveying to the Trust or the remaining Trustees any Trust Property held in
the name of such resigning or removed Trustee. Upon the incapacity or death of
any Trustee, such Trustee's legal representative shall execute and deliver on
such Trustee's behalf such documents as the remaining Trustees shall require
as provided in the preceding sentence.
2.4 Vacancies. The term of office of a Trustee shall terminate and a
vacancy shall occur in the event of the death, resignation, bankruptcy,
adjudicated incompetence or other incapacity to perform the duties of the
office, or removal, of a Trustee. Whenever a vacancy in the Board of Trustees
shall occur, the remaining Trustees may fill such vacancy by appointing an
individual having the qualifications described in this Article II by a written
instrument signed by a majority of the Trustees then in office or by election
by the Shareholders or may leave such vacancy unfilled or may reduce the
number of Trustees; provided that the aggregate number of Trustees after such
reduction shall not be less than the minimum number required by Section 2.1
hereof. Any vacancy created by an increase in Trustees may be filled by the
appointment of an individual having the qualifications described in this
Article II made by a written instrument signed by a majority of the Trustees
then in office or by election by the Shareholders. No vacancy shall operate to
annul this Declaration or to revoke any existing agency created pursuant to
the terms of this Declaration. Whenever a vacancy in the number of Trustees
shall occur, until such vacancy is filled as provided herein, the Trustees in
office, regardless of their number, shall have all the powers granted to the
Trustees and shall discharge all the duties imposed upon the Trustees by this
Declaration.
2.5 Meetings. Meetings of the Trustees shall be held from time to
time upon the call of the Chairman, if any, or the President or any two
Trustees. Regular meetings of the Trustees may be held without call or notice
at a time and place fixed by the By-Laws or by resolution of the Trustees.
Notice of any other meeting shall be given by the Secretary and shall be
delivered to the Trustees orally not less than 24 hours, or in writing not
less than 72 hours, before the meeting, but may be waived in writing by any
Trustee either before or after such meeting. The attendance of a Trustee at a
meeting shall constitute a waiver of notice of such meeting except where a
Trustee attends a meeting for the express purpose of objecting to the
transaction of any business on the ground that the meeting has not been
properly called or convened. A quorum for all meetings of the Trustees shall
be not less than two. Unless provided otherwise in this Declaration and except
as required under the 1940 Act, any action of the Trustees may be taken at a
meeting by vote of a majority of the Trustees present (a quorum being present)
or without a meeting by written consent of a majority of the Trustees.
Any committee of the Trustees, including an executive committee, if
any, may act with or without a meeting. A quorum for all meetings of any such
committee shall be one-third, but not less than two, of the members thereof.
Unless provided otherwise in this Declaration, any action of any such
committee may be taken at a meeting by vote of a majority of the members
present (a quorum being present) or without a meeting as set forth in Section
2.6.
With respect to actions of the Trustees and any committee of the
Trustees, Trustees who are Interested Persons in any action to be taken may be
counted for quorum purposes under this Section and shall be entitled to vote
to the extent not prohibited by the 1940 Act.
All or any one or more Trustees may participate in a meeting of the
Trustees or any committee thereof by means of a conference telephone or
similar communications equipment by means of which all persons participating
in the meeting can hear each other; participation in a meeting pursuant to any
such communications system shall constitute presence in person at such meeting
for all purposes of the Trust, except to the extent that participation in such
a meeting would not satisfy any requirement under the 1940 Act with respect to
any matter that requires the in personam approval of the Trustees.
2.6 Trustee Action by Written Consent. Unless provided otherwise in
this Declaration and except as required under the 1940 Act, any action which
may be taken by Trustees by vote may be authorized or taken without a meeting
if the Trustees, or members of a committee, as the case may be, having not
less than the minimum number of votes that would be necessary to authorize or
take such action at a meeting at which all Trustees, or members of a
committee, as the case may be, entitled to vote thereon were present and
voted, consent to the action in writing and the written consents are filed
with the records of the meetings of Trustees. Such consent shall be treated
for all purposes as a vote taken at a meeting of Trustees.
2.7 Officers. The Trustees shall elect a President, Secretary, Vice
President, Treasurer and one or more Assistant Secretaries and may elect a
Chairman who shall each serve at the pleasure of the Trustees or until their
successors are elected. The Trustees may elect or appoint or may authorize the
Chairman, if any, or President to appoint such other officers or agents with
such powers as the Trustees may deem to be advisable. A Chairman shall, and
the President, Secretary, Vice President, Treasurer and any Assistant
Secretary may, but need not, be a Trustee.
ARTICLE III
Powers and Duties of Trustees
3.1 General. The Trustees shall owe to the Trust and its Shareholders
the same fiduciary duties as owed by directors of corporations to such
corporations and their stockholders under the Delaware General Corporation
Law. The Trustees shall have exclusive and absolute control over the Trust
Property and over the business of the Trust to the same extent as if the
Trustees were the sole owners of the Trust Property and business in their own
right, but with such powers of delegation as may be permitted by this
Declaration. The Trustees may perform such acts as they, in their sole
discretion, determine to be proper for conducting the business of the Trust.
The enumeration of any specific power herein shall not be construed as
limiting the aforesaid power. Such powers of the Trustees may be exercised
without order of or resort to any court.
3.2 Investments. The Trustees shall have power, subject to the
Fundamental Policies in effect from time to time with respect to the Trust to:
(a) manage, conduct, operate and carry on the business of an
investment company;
(b) subscribe for, invest in, reinvest in, purchase or otherwise
acquire, hold, pledge, sell, assign, transfer, exchange, distribute or
otherwise deal in or dispose of any and all sorts of property, tangible or
intangible, including but not limited to securities of any type whatsoever,
whether equity or non-equity, of any issuer, evidences of indebtedness of any
person and any other rights, interests, instruments or property of any sort
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 to
exercise any of said rights, powers and privileges in respect of any of said
investments. The Trustees shall not be limited by any law limiting the
investments which may be made by fiduciaries.
3.3 Legal Title. Legal title to all the Trust Property shall be
vested in the Trustees as joint tenants except that the Trustees shall have
power to cause legal title to any Trust Property to be held by or in the name
of one or more of the Trustees, or in the name of the Trust, or in the name of
any other Person as nominee, custodian or pledgee, on such terms as the
Trustees may determine; provided that the interest of the Trust therein is
appropriately protected.
The right, title and interest of the Trustees in the Trust Property
shall vest automatically in each person who may hereafter become a Trustee
upon his due election and qualification. Upon the ceasing of any person to be
a Trustee for any reason, such person shall automatically cease to have any
right, title or interest in any of the Trust Property, and the right, title
and interest of such Trustee in the Trust Property shall vest automatically in
the remaining Trustees. Such vesting and cessation of title shall be effective
whether or not conveyancing documents have been executed and delivered.
3.4 Issuance and Repurchase of Shares. The Trustees shall have the
power to issue, sell, repurchase, redeem, retire, cancel, acquire, hold,
resell, reissue, dispose of, transfer, and otherwise deal in, Shares,
including Shares in fractional denominations, and, subject to the more
detailed provisions set forth in Articles VIII and IX, to apply to any such
repurchase, redemption, retirement, cancellation or acquisition of Shares any
funds or property whether capital or surplus or otherwise, to the full extent
now or hereafter permitted corporations formed under the Delaware General
Corporation Law.
3.5 Borrow Money or Utilize Leverage. Subject to the Fundamental
Policies in effect from time to time with respect to the Trust, the Trustees
shall have the power to borrow money or otherwise obtain credit or utilize
leverage to the maximum extent permitted by law or regulation as such may be
needed from time to time and to secure the same by mortgaging, pledging or
otherwise subjecting as security the assets of the Trust, including the
lending of portfolio securities, and to endorse, guarantee, or undertake the
performance of any obligation, contract or engagement of any other person,
firm, association or corporation.
3.6 Delegation; Committees. The Trustees shall have the power,
consistent with their continuing exclusive authority over the management of
the Trust and the Trust Property, to delegate from time to time to such of
their number or to officers, employees or agents of the Trust the doing of
such things and the execution of such instruments either in the name of the
Trust or the names of the Trustees or otherwise as the Trustees may deem
expedient, to at least the same extent as such delegation is permitted to
directors of corporations formed under the Delaware General Corporation Law
and is permitted by the 1940 Act, as well as any further delegations the
Trustees may determine to be desirable, expedient or necessary in order to
effect the purpose hereof.
3.7 Collection and Payment. The Trustees shall have power to collect
all property due to the Trust; to pay all claims, including taxes, against the
Trust Property or the Trust, the Trustees or any officer, employee or agent of
the Trust; to prosecute, defend, compromise or abandon any claims relating to
the Trust Property or the Trust, or the Trustees or any officer, employee or
agent of the Trust; to foreclose any security interest securing any
obligations, by virtue of which any property is owed to the Trust; and to
enter into releases, agreements and other instruments. Except to the extent
required for a corporation formed under the Delaware General Corporation Law,
the Shareholders shall have no power to vote as to whether or not a court
action, legal proceeding or claim should or should not be brought or
maintained derivatively or as a class action on behalf of the Trust or the
Shareholders.
3.8 Expenses. The Trustees shall have power to incur and pay out of
the assets or income of the Trust any expenses which in the opinion of the
Trustees are necessary or incidental to carry out any of the purposes of this
Declaration, and the business of the Trust, and to pay reasonable compensation
from the funds of the Trust to themselves as Trustees. The Trustees shall fix
the compensation of all officers, employees and Trustees. The Trustees may pay
themselves such compensation for special services, including legal,
underwriting, syndicating and brokerage services, as they in good faith may
deem reasonable and reimbursement for expenses reasonably incurred by
themselves on behalf of the Trust.
3.9 By-Laws. The Trustees shall have the exclusive authority to adopt
and from time to time amend or repeal By-Laws for the conduct of the business
of the Trust.
3.10 Miscellaneous Powers. The Trustees shall have the power to: (a)
employ or contract with such Persons as the Trustees may deem desirable for
the transaction of the business of the Trust; (b) enter into joint ventures,
partnerships and any other combinations or associations; (c) purchase, and pay
for out of Trust Property, insurance policies insuring the Shareholders,
Trustees, officers, employees, agents, investment advisers, distributors,
selected dealers or independent contractors of the Trust against all claims
arising by reason of holding any such position or by reason of any action
taken or omitted by any such Person in such capacity, whether or not
constituting negligence, or whether or not the Trust would have the power to
indemnify such Person against such liability; (d) establish pension,
profit-sharing, share purchase, and other retirement, incentive and benefit
plans for any Trustees, officers, employees and agents of the Trust; (e) make
donations, irrespective of benefit to the Trust, for charitable, religious,
educational, scientific, civic or similar purposes; (f) to the extent
permitted by law, indemnify any Person with whom the Trust has dealings,
including without limitation any adviser, administrator, manager, transfer
agent, custodian, distributor or selling agent, or any other person as the
Trustees may see fit to such extent as the Trustees shall determine; (g)
guarantee indebtedness or contractual obligations of others; (h) determine and
change the fiscal year of the Trust and the method in which its accounts shall
be kept; and (i) adopt a seal for the Trust, but the absence of such seal
shall not impair the validity of any instrument executed on behalf of the
Trust.
3.11 Further Powers. The Trustees shall have the power to conduct the
business of the Trust 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 and all commonwealths, territories, dependencies,
colonies, possessions, agencies or instrumentalities of the United States of
America and of foreign governments, and to do all such other things and
execute all such instruments as they deem necessary, proper or desirable in
order to promote the interests of the Trust although such things are not
herein specifically mentioned. Any determination as to what is in the
interests of the Trust made by the Trustees in good faith shall be conclusive.
In construing the provisions of this Declaration, the presumption shall be in
favor of a grant of power to the Trustees. The Trustees will not be required
to obtain any court order to deal with the Trust Property.
ARTICLE IV
Advisory, Management and Distribution Arrangements
4.1 Advisory and Management Arrangements. Subject to the requirements
of applicable law as in effect from time to time, the Trustees may in their
discretion from time to time enter into advisory, administration or management
contracts (including, in each case, one or more sub-advisory,
sub-administration or sub-management contracts) whereby the other party to any
such contract shall undertake to furnish the Trustees such advisory,
administrative and management services, with respect to the Trust as the
Trustees shall from time to time consider desirable and all upon such terms
and conditions as the Trustees may in their discretion determine.
Notwithstanding any provisions of this Declaration, the Trustees may authorize
any adviser, administrator or manager (subject to such general or specific
instructions as the Trustees may from time to time adopt) to effect investment
transactions with respect to the assets on behalf of the Trustees to the full
extent of the power of the Trustees to effect such transactions or may
authorize any officer, employee or Trustee to effect such transactions
pursuant to recommendations of any such adviser, administrator or manager (and
all without further action by the Trustees). Any such investment transaction
shall be deemed to have been authorized by all of the Trustees.
4.2 Distribution Arrangements. Subject to compliance with the 1940
Act, the Trustees may retain distributors and/or selling agents to sell
Shares. The Trustees may in their discretion from time to time enter into one
or more contracts, providing for the sale of the Shares, whereby the Trust may
either agree to sell such Shares to the other party to the contract or appoint
such other party its distributor or selling agent for such Shares. In either
case, the contract shall be on such terms and conditions as the Trustees may
in their discretion determine not inconsistent with the provisions of this
Article IV, the By-Laws or the 1940 Act; and such contract may also provide
for the repurchase or sale of Shares by such other party as principal or as
agent of the Trust and may provide that such other party may enter into
selling and servicing (and similar) agreements with registered securities
dealers and brokers (or with persons who are not registered securities dealers
but are otherwise authorized to distribute or repurchase Shares) to further
the purposes of the distribution or repurchase of the Shares of the Trust.
4.3 Parties to Contract. Any contract of the character described in
Sections 4.1 and 4.2 of this Article IV or in Article VII hereof may be
entered into with any Person, although one or more of the Trustees, officers
or employees of the Trust may be an officer, director, trustee, shareholder,
or member of such other party to the contract, and no such contract shall be
invalidated or rendered voidable by reason of the existence of any such
relationship, nor shall any Person holding such relationship be liable merely
by reason of such relationship for any loss or expense to the Trust under or
by reason of said contract or accountable for any profit realized directly or
indirectly therefrom; provided that the contract when entered into was
reasonable and fair and not inconsistent with the provisions of this Article
IV or the By-Laws. The same Person may be the other party to contracts entered
into pursuant to Sections 4.1 and 4.2 above or Article VII, and any individual
may be financially interested or otherwise affiliated with Persons who are
parties to any or all of the contracts mentioned in this Section 4.3.
ARTICLE V
Limitations of Liability and Indemnification
5.1 No Personal Liability of Shareholders, Trustees, etc. No
Shareholder of the Trust shall be subject in such capacity to any personal
liability whatsoever to any Person in connection with Trust Property or the
acts, obligations or affairs of the Trust. Shareholders shall have the same
limitation of personal liability as is extended to stockholders of a private
corporation for profit incorporated under the Delaware General Corporation
Law. No Trustee or officer of the Trust shall be subject in such capacity to
any personal liability whatsoever to any Person, other than the Trust or its
Shareholders, in connection with Trust Property or the affairs of the Trust,
save only liability to the Trust or its Shareholders arising from bad faith,
willful misfeasance, gross negligence (negligence in the case of those
Trustees or officers who are directors, officers or employees of the Trust's
investment adviser ("Affiliated Indemnitees")) or reckless disregard for his
duty to such Person; and, subject to the foregoing exception, all such Persons
shall look solely to the Trust Property for satisfaction of claims of any
nature arising in connection with the affairs of the Trust. If any
Shareholder, Trustee or officer, as such, of the Trust, is made a party to any
suit or proceeding to enforce any such liability, subject to the foregoing
exception, he shall not, on account thereof, be held to any personal
liability. Any repeal or modification of this Section 5.1 shall not adversely
affect any right or protection of a Trustee or officer of the Trust existing
at the time of such repeal or modification with respect to acts or omissions
occurring prior to such repeal or modification.
5.2 Mandatory Indemnification.
(a) The Trust hereby agrees to indemnify each person who at any time
serves as a Trustee or officer of the Trust (each such person being an
"Indemnitee") against any liabilities and expenses, including amounts paid in
satisfaction of judgments, in compromise or as fines and penalties, and
reasonable counsel fees reasonably incurred by such Indemnitee in connection
with the defense or disposition of any action, suit or other proceeding,
whether civil or criminal, before any court or administrative or investigative
body in which he may be or may have been involved as a party or otherwise or
with which he may be or may have been threatened, while acting in any capacity
set forth in this Article V by reason of his having acted in any such
capacity, except with respect to any matter as to which he shall not have
acted in good faith in the reasonable belief that his action was in the best
interest of the Trust or, in the case of any criminal proceeding, as to which
he shall have had reasonable cause to believe that the conduct was unlawful;
provided, however, that no Indemnitee shall be indemnified hereunder against
any liability to any person or any expense of such Indemnitee arising by
reason of (i) willful misfeasance, (ii) bad faith, (iii) gross negligence, or
(iv) reckless disregard of the duties involved in the conduct of his position
(the conduct referred to in such clauses (i) through (iv) being sometimes
referred to herein as "disabling conduct"). Notwithstanding the foregoing,
with respect to any action, suit or other proceeding voluntarily prosecuted by
any Indemnitee as plaintiff, indemnification shall be mandatory only if the
prosecution of such action, suit or other proceeding by such Indemnitee (1)
was authorized by a majority of the Trustees or (2) was instituted by the
Indemnitee to enforce his or her rights to indemnification hereunder in a case
in which the Indemnitee is found to be entitled to such indemnification. The
rights to indemnification set forth in this Declaration shall continue as to a
person who has ceased to be a Trustee or officer of the Trust and shall inure
to the benefit of his or her heirs, executors and personal and legal
representatives. No amendment or restatement of this Declaration or repeal of
any of its provisions shall limit or eliminate any of the benefits provided to
any person who at any time is or was a Trustee or officer of the Trust or
otherwise entitled to indemnification hereunder in respect of any act or
omission that occurred prior to such amendment, restatement or repeal.
(b) Notwithstanding the foregoing, no indemnification shall be made
hereunder unless there has been a determination (i) by a final decision on the
merits by a court or other body of competent jurisdiction before whom the
issue of entitlement to indemnification hereunder was brought that such
Indemnitee is entitled to indemnification hereunder or, (ii) in the absence of
such a decision, by (1) a majority vote of a quorum of those Trustees who are
neither Interested Persons of the Trust nor parties to the proceeding
("Disinterested Non-Party Trustees"), that the Indemnitee is entitled to
indemnification hereunder, or (2) if such quorum is not obtainable or even if
obtainable, if such majority so directs, independent legal counsel in a
written opinion concludes that the Indemnitee should be entitled to
indemnification hereunder. All determinations to make advance payments in
connection with the expense of defending any proceeding shall be authorized
and made in accordance with the immediately succeeding paragraph (c) below.
(c) The Trust shall make advance payments in connection with the
expenses of defending any action with respect to which indemnification might
be sought hereunder if the Trust receives a written affirmation by the
Indemnitee of the Indemnitee's good faith belief that the standards of conduct
necessary for indemnification have been met and a written undertaking to
reimburse the Trust unless it is subsequently determined that the Indemnitee
is entitled to such indemnification and if a majority of the Trustees
determine that the applicable standards of conduct necessary for
indemnification appear to have been met. In addition, at least one of the
following conditions must be met: (i) the Indemnitee shall provide adequate
security for his undertaking, (ii) the Trust shall be insured against losses
arising by reason of any lawful advances, or (iii) a majority of a quorum of
the Disinterested Non-Party Trustees, or if a majority vote of such quorum so
direct, independent legal counsel in a written opinion, shall conclude, based
on a review of readily available facts (as opposed to a full trial-type
inquiry), that there is substantial reason to believe that the Indemnitee
ultimately will be found entitled to indemnification.
(d) The rights accruing to any Indemnitee under these provisions
shall not exclude any other right which any person may have or hereafter
acquire under this Declaration, the By-Laws of the Trust, any statute,
agreement, vote of stockholders or persons that are not Interested Persons or
any other right to which he or she may be lawfully entitled.
(e) Subject to any limitations provided by the 1940 Act and this
Declaration, the Trust shall have the power and authority to indemnify and
provide for the advance payment of expenses to employees, agents and other
Persons providing services to the Trust or serving in any capacity at the
request of the Trust to the full extent corporations organized under the
Delaware General Corporation Law may indemnify or provide for the advance
payment of expenses for such Persons; provided that such indemnification has
been approved by a majority of the Trustees.
5.3 No Bond Required of Trustees. No Trustee shall, as such, be
obligated to give any bond or other security for the performance of any of his
duties hereunder.
5.4 No Duty of Investigation; Notice in Trust Instruments, etc. No
purchaser, lender, transfer agent or other person dealing with the Trustees or
with any officer, employee or agent of the Trust shall be bound to make any
inquiry concerning the validity of any transaction purporting to be made by
the Trustees or by said officer, employee or agent or be liable for the
application of money or property paid, loaned, or delivered to or on the order
of the Trustees or of said officer, employee or agent. Every obligation,
contract, undertaking, instrument, certificate, Share, other security of the
Trust, and every other act or thing whatsoever executed in connection with the
Trust shall be conclusively taken to have been executed or done by the
executors thereof only in their capacity as Trustees under this Declaration or
in their capacity as officers, employees or agents of the Trust. Every written
obligation, contract, undertaking, instrument, certificate, Share, other
security of the Trust made or issued by the Trustees or by any officers,
employees or agents of the Trust in their capacity as such, shall contain an
appropriate recital to the effect that the Shareholders, Trustees, officers,
employees or agents of the Trust shall not personally be bound by or liable
thereunder, nor shall resort be had to their private property for the
satisfaction of any obligation or claim thereunder, and appropriate references
shall be made therein to this Declaration, and may contain any further recital
which they may deem appropriate, but the omission of such recital shall not
operate to impose personal liability on any of the Trustees, Shareholders,
officers, employees or agents of the Trust. The Trustees may maintain
insurance, including a fidelity bond, for the protection of the Trust
Property, its Shareholders, Trustees, officers, employees and agents in such
amount as the Trustees shall deem adequate to cover possible tort liability,
and such other insurance as the Trustees in their sole judgment shall deem
advisable or is required by the 1940 Act.
5.5 Reliance on Experts, etc. Each Trustee and officer or employee of
the Trust shall, in the performance of its duties, be fully and completely
justified and protected with regard to any act or any failure to act resulting
from reliance in good faith upon the books of account or other records of the
Trust, upon an opinion of counsel, or upon reports made to the Trust by any of
the Trust's officers or employees or by any advisor, administrator, manager,
distributor, selected dealer, accountant, appraiser or other expert or
consultant selected with reasonable care by the Trustees, officers or
employees of the Trust, regardless of whether such counsel or expert may also
be a Trustee.
5.6 Indemnification of Shareholders. If any Shareholder or former
Shareholder shall be held personally liable solely by reason of its being or
having been a Shareholder and not because of its acts or omissions or for some
other reason, the Shareholder or former Shareholder (or its heirs, executors,
administrators or other legal representatives or in the case of any entity,
its general successor) shall be entitled out of the assets belonging to the
Trust to be held harmless from and indemnified to the maximum extent permitted
by law against all loss and expense arising from such liability. The Trust
shall, upon request by such Shareholder, assume the defense of any claim made
against such Shareholder for any act or obligation of the Trust and satisfy
any judgment thereon from the assets of the Trust.
ARTICLE VI
Shares of Beneficial Interest
6.1 Beneficial Interest. The interest of the beneficiaries hereunder
shall be divided into an unlimited number of transferable shares of beneficial
interest, par value $.001 per share. All Shares issued in accordance with the
terms hereof, including, without limitation, Shares issued in connection with
a dividend in Shares or a split of Shares, shall be fully paid and
nonassessable when the consideration determined by the Trustees (if any)
therefor shall have been received by the Trust.
6.2 Other Securities. The Trustees may authorize and issue such other
securities as they determine to be necessary, desirable or appropriate,
including additional classes of Shares, preferred interests, debt securities
or other senior securities subject to the Fundamental Policies and the
requirements of the 1940 Act. To the extent that the Trustees authorize and
issue other securities, they are hereby authorized and empowered to amend or
supplement this Declaration as is necessary or appropriate to comply with the
requirements of the 1940 Act relating to such securities or as required to
issue such securities, all without the approval of Shareholders. Any such
supplement or amendment shall be filed as is necessary. The Trustees are also
authorized to take such actions and retain such persons as they see fit to
offer and sell such securities.
6.3 Rights of Shareholders. The Shares shall be personal property
giving only the rights in this Declaration specifically set forth. The
ownership of the Trust Property of every description and the right to conduct
any business herein before described are vested exclusively in the Trustees,
and the Shareholders shall have no interest therein other than the beneficial
interest conferred by their Shares, and they shall have no right to call for
any partition or division of any property, profits, rights or interests of the
Trust nor can they be called upon to share or assume any losses of the Trust
or suffer an assessment of any kind by virtue of their ownership of Shares.
Shares shall not entitle the holder thereof to preference, preemptive,
appraisal, conversion or exchange rights (except as specified in this Section
6.3, in Section 11.4 or as specified by the Trustees when creating the
Shares).
6.4 Trust Only. It is the intention of the Trustees to create only
the relationship of Trustee and beneficiary between the Trustees and each
Shareholder from time to time. It is not the intention of the Trustees to
create a general partnership, limited partnership, limited liability company,
joint stock association, corporation, bailment or any form of legal
relationship other than a trust. Nothing in this Declaration shall be
construed to make the Shareholders, either by themselves or with the Trustees,
partners or members of a joint stock association.
6.5 Issuance of Shares. The Trustees, in their discretion, may from
time to time without vote of the Shareholders issue Shares, including multiple
classes of Shares, in addition to the then issued and outstanding Shares and
Shares held in the treasury, to such party or parties and for such amount and
type of consideration, including cash or property, at such time or times, and
on such terms as the Trustees may determine, and may in such manner acquire
other assets (including the acquisition of assets subject to, and in
connection with the assumption of, liabilities) and businesses. The Trustees
may from time to time divide or combine the Shares into a greater or lesser
number without thereby changing the proportionate beneficial interest in such
Shares. Issuances and redemptions of Shares may be made in whole Shares
and/or, as the Trustees may determine, in such fractions thereof.
6.6 Register of Shares. A register shall be kept at the offices of
the Trust or any transfer agent duly appointed by the Trustees under the
direction of the Trustees which shall contain the names and addresses of the
Shareholders and the number of Shares held by them respectively and a record
of all transfers thereof. Separate registers shall be established and
maintained for each class. Each such register shall be conclusive as to who
are the holders of the Shares of the applicable class and who shall be
entitled to receive dividends or distributions or otherwise to exercise or
enjoy the rights of Shareholders. No Shareholder shall be entitled to receive
payment of any dividend or distribution, nor to have notice given to him as
herein provided, until he has given his address to a transfer agent or such
other officer or agent of the Trustees as shall keep the register for entry
thereon. It is not contemplated that certificates will be issued for the
Shares; provided, however, that the Trustees, in their discretion, may
authorize the issuance of share certificates and promulgate appropriate fees
therefore and rules and regulations as to their use.
6.7 Transfer Agent and Registrar. The Trustees shall have power to
employ a transfer agent or transfer agents, and a registrar or registrars,
with respect to the Shares. The transfer agent or transfer agents may keep the
applicable register and record therein, the original issues and transfers, if
any, of the said Shares. Any such transfer agents and/or registrars shall
perform the duties usually performed by transfer agents and registrars of
certificates of stock in a corporation, as modified by the Trustees.
6.8 Transfer of Shares.
(a) Subject to clause (b) of this Section 6.8, Shares shall be
transferable on the records of the Trust only by the record holder thereof or
by its agent thereto duly authorized in writing, upon delivery to the Trustees
or a transfer agent of the Trust of a duly executed instrument of transfer,
together with such evidence of the genuineness of each such execution and
authorization and of other matters as may reasonably be required. Subject to
clause (b) of this Section 6.8, upon such delivery the transfer shall be
recorded on the applicable register of the Trust. Until such record is made,
the Shareholder of record shall be deemed to be the holder of such Shares for
all purposes hereof and neither the Trustees nor any transfer agent or
registrar nor any officer, employee or agent of the Trust shall be affected by
any notice of the proposed transfer.
Subject to clause (b) of this Section 6.8, any purported transferee
of Shares as a result of the death, bankruptcy, or incompetence of any
Shareholder, or otherwise by operation of law, shall be recorded on the
applicable register of Shares as the holder of such Shares upon production of
the proper evidence thereof (including evidence satisfying subclauses (i) and
(ii) of clause (b) of this Section 6.8) to the Trustees or a transfer agent of
the Trust, but until such record is made, the Shareholder of record shall be
deemed to be the holder of such for all purposes hereof, and neither the
Trustees nor any transfer agent or registrar nor any officer or agent of the
Trust shall be affected by any notice of such death, bankruptcy or
incompetence, or other operation of law. (b) Shares and any interest therein
shall be subject to restrictions on transfer as set forth herein.
(i) Shares and any interest therein may be held only through a
broker or dealer that has entered into an agreement for the provision
of shareholder services to the Trust;
(ii) Shares and any interest therein may not be transferred,
except to any person or entity who meets the standard as a "qualified
client" within the meaning of paragraph (d)(1)(ii)(A) of Rule 205-3
under the Advisers Act.
Any transfer of Shares or any interest therein that, if effective, would not
comply with this Section 6.8(b) shall be void to the fullest extent permitted
by law and the purported transferee shall acquire no rights in such Shares. In
addition, the Trustees shall have the right, but shall not be required, to
repurchase such Shares from such purported transferee in accordance with
Section 8.2 hereof.
6.9 Notices. Any and all notices to which any Shareholder hereunder
may be entitled and any and all communications shall be deemed duly served or
given if mailed, postage prepaid, addressed to any Shareholder of record at
his last known address as recorded on the applicable register of the Trust.
ARTICLE VII
Custodians
7.1 Appointment and Duties. The Trustees shall at all times employ a
custodian or custodians, meeting the qualifications for custodians for
portfolio securities of investment companies contained in the 1940 Act, as
custodian with respect to the assets of the Trust. Any custodian shall have
authority as agent of the Trust with respect to which it is acting as
determined by the custodian agreement or agreements, but subject to such
restrictions, limitations and other requirements, if any, as may be contained
in the By-Laws of the Trust and the 1940 Act:
(a) to hold the securities owned by the Trust and deliver the
same upon written order;
(b) to receive any receipt for any moneys due to the Trust and
deposit the same in its own banking department (if a bank) or
elsewhere as the Trustees may direct;
(c) to disburse such funds upon orders or vouchers;
(d) if authorized by the Trustees, to keep the books and
accounts of the Trust and furnish clerical and accounting services;
and
(e) if authorized to do so by the Trustees, to compute the net
income or net asset value of the Trust;
all upon such basis of compensation as may be agreed upon between the Trustees
and the custodian.
The Trustees may also authorize each custodian to employ one or more
sub-custodians from time to time to perform such of the acts and services of
the custodian and upon such terms and conditions, as may be agreed upon
between the custodian and such sub-custodian and approved by the Trustees;
provided that in every case such sub-custodian shall meet the qualifications
for custodians contained in the 1940 Act.
7.2 Central Certificate System. Subject to such rules, regulations
and orders as the Commission may adopt, 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 Exchange Act 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 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 VIII
Redemptions; Repurchases, etc.
8.1 Redemptions. The Shares of the Trust are not redeemable by the
Shareholders.
8.2 Repurchases. Subject to the requirements of the 1940 Act, the
Trustees are empowered to authorize the repurchase by the Trust from time to
time of all or any portion of the Shares, whether now or hereafter authorized,
or securities convertible into Shares of any class or classes, whether now or
hereafter authorized, upon such time, at such prices (which may be determined
by formula) and subject to such conditions (which may include prorating shares
tendered for repurchase) as the Trustees may determine.
8.3 Disclosure of Holding. The holders of Shares or other securities
of the Trust shall, upon demand, disclose to the Trustees in writing such
information with respect to direct and indirect ownership of Shares or other
securities of the Trust as the Trustees deem necessary to comply with the
provisions of the Code, the 1940 Act or other applicable laws or regulations,
or to comply with the requirements of any other taxing or regulatory
authority.
ARTICLE IX
Determination of Net Asset Value, Net Income and Distributions
9.1 Net Asset Value. The net asset value of each outstanding Share of
the Trust shall be determined at such time or times on such days as the
Trustees may determine, in accordance with the 1940 Act. The method of
determination of net asset value shall be determined by the Trustees and shall
be as set forth in the Prospectus or as may otherwise be determined by the
Trustees. The power and duty to make the net asset value calculations may be
delegated by the Trustees and shall be as generally set forth in the
Prospectus or as may otherwise be determined by the Trustees.
9.2 Distributions to Shareholders.
(a) The Trustees shall from time to time distribute ratably among the
Shareholders such proportion of the net profits, surplus (including paid-in
surplus), capital or assets held by the Trustees as they may deem proper. Such
distribution may be made in cash or property (including without limitation any
type of obligations of the Trust or any assets thereof) or any combination
thereof, and the Trustees may distribute ratably among the Shareholders
additional Shares in such manner, at such times, and on such terms as the
Trustees may deem proper.
(b) In the event the Trust has outstanding more than one class of
Shares, the Trustees shall from time to time distribute ratably among each
class of Shareholders of the Trust such proportion of the net profits, surplus
(including paid-in surplus), capital or assets attributable to such class held
by the Trustees as they may deem proper or as may otherwise be determined in
the instrument creating such class of Shares, and the Trustees may distribute
ratably among the Shareholders of each class of the Trust additional Shares of
such class in such manner, at such times, and on such terms as the Trustees
may deem proper. Such distributions to one class need not be ratable with
respect to distributions to Shares of any other class of the Trust.
(c) Distributions pursuant to this Section 9.2 may be among the
Shareholders of record at the time of declaring a distribution or among the
Shareholders of record at such later date as the Trustees shall determine and
specify at the time of declaration.
(d) The Trustees may always retain from the net profits such amount
as they may deem necessary to pay the debts or expenses of the Trust or to
meet obligations of the Trust, or as they otherwise may deem desirable to use
in the conduct of its affairs or to retain for future requirements or
extensions of the business.
(e) Inasmuch as the computation of net income and gains for federal
income tax purposes may vary from the computation thereof on the books, the
above provisions shall be interpreted to give the Trustees the power in their
discretion to distribute for any fiscal year as ordinary dividends and as
capital gains distributions, respectively, additional amounts sufficient to
enable the Trust to avoid or reduce liability for taxes.
9.3 Power to Modify Foregoing Procedures. Notwithstanding any of the
foregoing provisions of this Article IX, the Trustees may prescribe, in their
absolute discretion except as may be required by the 1940 Act, such other
bases and times for determining the per share asset value of the Trust's
Shares or net income, or the declaration and payment of dividends and
distributions as they may deem necessary or desirable for any reason,
including to enable the Trust to comply with any provision of the 1940 Act, or
the Exchange Act, or any order of exemption issued by the Commission, all as
in effect now or hereafter amended or modified.
ARTICLE X
Shareholders
10.1 Meetings of Shareholders. The Trust shall not hold annual
meetings of the Shareholders. A special meeting of Shareholders may be called
at any time by a majority of the Trustees or the President and shall be called
by any Trustee for any proper purpose upon written request of Shareholders of
the Trust holding in the aggregate not less than 51% of the outstanding Shares
of the Trust or class having voting rights, such request specifying the
purpose or purposes for which such meeting is to be called. Any Shareholder
meeting shall be held within or without the State of Delaware on such day and
at such time as the Trustees shall designate.
10.2 Voting. Shareholders shall have no power to vote on any matter
except matters on which a vote of Shareholders is required by the 1940 Act,
other applicable law, this Declaration or resolution of the Trustees. Except
as otherwise provided herein, any matter required to be submitted to
Shareholders and affecting one or more classes shall require approval by the
required vote of all the affected classes of Shares voting together as a
single class; provided, however, that as to any matter with respect to which a
separate vote of any class is required by the 1940 Act, such requirement as to
a separate vote by that class shall apply in lieu of a vote of all the
affected classes voting together as a single class. Shareholders of a
particular class shall not be entitled to vote on any matter that affects only
one or more other classes. There shall be no cumulative voting in the election
or removal of Trustees. The Trustees shall cause each matter required or
permitted to be voted upon at a meeting or by written consent of Shareholders
to be submitted to a vote of all classes of outstanding Shares entitled to
vote thereon, unless the 1940 Act, other applicable law or this Declaration
requires that the actions of the Shareholders be taken by a separate vote of
one or more classes, or the Trustees determine that any matter to be submitted
to a vote of Shareholders affects only the rights or interests of one or more
(but not all) classes of outstanding Shares, in which case only the
Shareholders of the class or classes so affected shall be entitled to vote
thereon.
10.3 Notice of Meeting and Record Date. Notice of all meetings of
Shareholders, stating the time, place and purposes of the meeting, shall be
given by the Trustees by mail to each Shareholder of record entitled to vote
thereat at its registered address, mailed at least 10 days and not more than
90 days before the meeting or otherwise in compliance with applicable law.
Only the business stated in the notice of the meeting shall be considered at
such meeting. Any adjourned meeting may be held as adjourned one or more times
without further notice not later than 120 days after the record date. For the
purposes of determining the Shareholders who are entitled to notice of and to
vote at any meeting, the Trustees may, without closing the transfer books, fix
a date not more than 90 nor less than 10 days prior to the date of such
meeting of Shareholders as a record date for the determination of the Persons
to be treated as Shareholders of record for such purposes.
10.4 Quorum and Required Vote.
(a) The holders of a majority of the Shares entitled to vote at the
meeting present in person or by proxy shall constitute a quorum at any meeting
of the Shareholders for purposes of conducting business on which a vote of
Shareholders of the Trust is being taken. The holders of a majority of the
Shares of a class entitled to vote at the meeting present in person or by
proxy shall constitute a quorum at any meeting of the Shareholders of such
class for purposes of conducting business on which a vote of Shareholders of
such class is being taken. The absence from any meeting, in person or by
proxy, of a quorum of Shareholders for action upon any given matter shall not
prevent action at such meeting upon any other matter or matters which may
properly come before the meeting, if there shall be present thereat, in person
or by proxy, a quorum of Shareholders in respect of such other matter.
(b) Subject to any provision of the 1940 Act or other applicable law
requiring greater or lesser votes, this Declaration or resolution of the
Trustees specifying a greater or lesser vote requirement for the transaction
of any item of business at any meeting of Shareholders, (i) the affirmative
vote of a majority of the Shares present in person or represented by proxy and
entitled to vote on the subject matter shall be the act of the Shareholders
with respect to such matter, and (ii) where a separate vote of any class is
required on any matter, the affirmative vote of a majority of the Shares of
such class present in person or represented by proxy at the meeting shall be
the act of the Shareholders of such class with respect to such matter. In the
event of any conflict between the 1940 Act and this Declaration with respect
to any vote requirement for the transaction of any item of business at any
meeting of Shareholders, the Trustees are authorized to specify the vote
requirement of the 1940 Act for the transaction of such item of business.
10.5 Proxies, etc. At any meeting of Shareholders, any holder of
Shares entitled to vote thereat may vote by properly executed proxy; 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. Pursuant to a resolution of a majority of the Trustees,
proxies may be solicited in the name of one or more Trustees or one or more of
the officers or employees of the Trust. Each full Share shall be entitled to
one vote and fractional Shares shall be entitled to a vote of such fraction.
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 to the legal control of
any other person as regards the charge or management of such Share, he may
vote by his guardian or such other person appointed or having such control,
and such vote may be given in person or by proxy.
10.6 Reports. The Trustees shall cause to be prepared at least
annually, and more frequently to the extent and in the form required by law or
regulation, a report of operations containing a statement of assets and
liabilities or balance sheet, a statement of income and undistributed income
of the Trust and a statement of changes in net assets, in each case, prepared
in conformity with generally accepted accounting principles and an opinion of
an independent public accountant on such financial statements. Copies of such
reports shall be mailed to all Shareholders of record within the time required
by the 1940 Act. The Trustees shall, in addition, furnish to the Shareholders
at least semi-annually to the extent required by law, interim reports
containing an unaudited statement of assets and liabilities or balance sheet
of the Trust as of the end of such period and an unaudited statement of income
and surplus and a statement of changes in net assets, in each case, for the
period from the beginning of the current fiscal year to the end of such
period.
10.7 Inspection of Records. The records of the Trust shall be open to
inspection by Shareholders to the same extent as is permitted shareholders of
a corporation formed under the Delaware General Corporation Law.
10.8 Shareholder Action by Written Consent. Any action which may be
taken by Shareholders by vote may be taken without a meeting if the holders
entitled to vote thereon of the proportion of Shares required for approval of
such action at a meeting of Shareholders pursuant to Section 10.4 consent to
the action in writing and the written consents are filed with the records of
the meetings of Shareholders. Such consent shall be treated for all purposes
as a vote taken at a meeting of Shareholders.
ARTICLE XI
Duration; Termination of Trust; Amendment; Mergers, Etc.
11.1 Duration. Subject to possible termination in accordance with the
provisions of Section 11.2 hereof, the Trust created hereby shall have
perpetual existence.
11.2 Termination.
(a) the Trust may be dissolved, after a majority of the Trustees have
approved a resolution therefor, upon approval by not less than 75% of the
Shares outstanding and entitled to vote, voting as a single class, unless such
resolution has been approved by 80% of the Trustees, in which case approval by
a Majority Shareholder Vote shall be required. Upon the dissolution of the
Trust:
(i) the Trust shall carry on no business except for the purpose
of winding up its affairs;
(ii) the Trustees shall proceed to wind up the affairs of the
Trust and all of the powers of the Trustees under this Declaration
shall continue until the affairs of the Trust shall have been wound
up, including the power to fulfill or discharge the contracts of the
Trust, collect its assets, sell, convey, assign, exchange, merge
where the Trust is not the survivor, transfer or otherwise dispose of
all or any part of the remaining Trust Property to one or more
Persons at public or private sale for consideration which may consist
in whole or in part in cash, securities or other property of any
kind, discharge or pay its liabilities, and do all other acts
appropriate to liquidate its business; provided that any sale,
conveyance, assignment, exchange, merger in which the Trust is not
the survivor, transfer or other disposition of all or substantially
all the Trust Property of the Trust shall require approval of the
principal terms of the transaction and the nature and amount of the
consideration by Shareholders with the same vote as required to
open-end the Trust; and
(iii) after paying or adequately providing for the payment of
all liabilities, and upon receipt of such releases, indemnities and
refunding agreements, as they deem necessary for their protection,
the Trustees may distribute the remaining Trust Property, in cash or
in kind or partly each, among the Shareholders according to their
respective rights.
(b) After the winding up and termination of the Trust and
distribution to the Shareholders as herein provided, a majority of the
Trustees shall execute and lodge among the records of the Trust an instrument
in writing setting forth the fact of such termination and shall execute and
file a certificate of cancellation with the Secretary of State of the State of
Delaware. Upon termination of the Trust, the Trustees shall thereupon be
discharged from all further liabilities and duties hereunder, and the rights
and interests of all Shareholders shall thereupon cease.
11.3 Amendment Procedure.
(a) Except as provided in subsection (b) of this Section 11.3, this
Declaration may be amended, after a majority of the Trustees have approved a
resolution therefor, by the affirmative vote of the holders of not less than a
majority of the affected Shares. The Trustees also may amend this Declaration
without any vote of Shareholders to divide the Shares of the Trust into one or
more classes or additional classes, to change the name of the Trust or any
class, to make any change that does not adversely affect the relative rights
or preferences of any Shareholder, as they may deem necessary, to conform this
Declaration to the requirements of the 1940 Act or any other applicable
federal laws or regulations including pursuant to Section 6.2 or the
requirements of the regulated investment company provisions of the Code, but
the Trustees shall not be liable for failing to do so.
(b) No amendment may be made to Section 2.1, Section 2.3, Section
3.9, Section 5.1, Section 5.2, Section 11.2(a), this Section 11.3, Section
11.4, Section 11.6 or Section 11.7 of this Declaration and no amendment may be
made to this Declaration which would change any rights with respect to any
Shares of the Trust by reducing the amount payable thereon upon liquidation of
the Trust or by diminishing or eliminating any voting rights pertaining
thereto (except that this provision shall not limit the ability of the
Trustees to authorize, and to cause the Trust to issue, other securities
pursuant to Section 6.2), except after a majority of the Trustees have
approved a resolution therefor, by the affirmative vote of the holders of not
less than seventy-five percent (75%) of the Shares outstanding and entitled to
vote, voting as a single class, unless such amendment has been approved by 80%
of the Trustees, in which case approval by a Majority Shareholder Vote shall
be required. Nothing contained in this Declaration shall permit the amendment
of this Declaration to impair the exemption from personal liability of the
Shareholders, Trustees, officers, employees and agents of the Trust or to
permit assessments upon Shareholders.
(c) An amendment duly adopted by the requisite vote of the Board of
Trustees and, if required, the Shareholders as aforesaid, shall become
effective at the time of such adoption or at such other time as may be
designated by the Board of Trustees or Shareholders, as the case may be. A
certification in recordable form signed by a majority of the Trustees setting
forth an amendment and reciting that it was duly adopted by the Trustees and,
if required, the Shareholders as aforesaid, or a copy of the Declaration, as
amended, in recordable form, and executed by a majority of the Trustees, shall
be conclusive evidence of such amendment when lodged among the records of the
Trust or at such other time designated by the Board.
Notwithstanding any other provision hereof, until such time as a
Registration Statement under the Securities Act covering the first public
offering of Shares of the Trust shall have become effective, this Declaration
may be terminated or amended in any respect by the affirmative vote of a
majority of the Trustees or by an instrument signed by a majority of the
Trustees.
11.4 Merger, Consolidation and Sale of Assets. Except as provided in
Section 11.7, the Trust may merge or consolidate with any other corporation,
association, trust or other organization or may sell, lease or exchange all or
substantially all of the Trust Property or the property, including its good
will, upon such terms and conditions and for such consideration when and as
authorized by two-thirds of the Trustees and approved by a majority vote of
the affected Shareholders and any such merger, consolidation, sale, lease or
exchange shall be determined for all purposes to have been accomplished under
and pursuant to the statutes of the State of Delaware.
11.5 Incorporation. Upon approval by Shareholders, the Trustees may
cause to be organized or assist in organizing, a corporation or corporations
under the laws of any jurisdiction or any other trust, partnership, limited
liability company, association or other organization to take over all of the
Trust Property or to carry on any business in which the Trust shall directly
or indirectly have any interest, and to sell, convey and transfer the Trust
Property to any such corporation, trust, partnership, limited liability
company, association or organization in exchange for the shares or securities
thereof, or otherwise, and to lend money to, subscribe for the shares or
securities of, and enter into any contracts with any such corporation, trust,
partnership, limited liability company, association or organization, or any
corporation, trust, partnership, limited liability company, association or
organization in which the Trust holds or is about to acquire shares or any
other interests. The Trustees may also cause a merger or consolidation between
the Trust or any successor thereto and any such corporation, trust,
partnership, limited liability company, association or other organization if
and to the extent permitted by law, as provided under the law then in effect.
Nothing contained herein shall be construed as requiring approval of
Shareholders for the Trustees to organize or assist in organizing one or more
corporations, trusts, partnerships, limited liability companies, associations
or other organizations and selling, conveying or transferring a portion of the
Trust Property to such organizations or entities.
11.6 Conversion. Notwithstanding any other provisions of this
Declaration or the By-Laws of the Trust, a favorable vote of a majority of the
Trustees then in office followed by the favorable vote of the holders of not
less than seventy-five percent (75%) of the Shares outstanding and entitled to
vote, voting as a single class, shall be required to approve, adopt or
authorize an amendment to this Declaration that makes the Shares or any other
class of units of beneficial interest of the Trust a "redeemable security" as
that term is defined in the 1940 Act, unless such amendment has been approved
by 80% of the Trustees, in which case approval by a Majority Shareholder Vote
shall be required. Upon the adoption of a proposal to convert the Trust from a
"closed-end company" to an "open-end company" as those terms are defined by
the 1940 Act and the necessary amendments to this Declaration to permit such a
conversion of the Trust's outstanding Shares entitled to vote, the Trust
shall, upon complying with any requirements of the 1940 Act and state law,
become an "open-end" investment company. Such affirmative vote or consent
shall be in addition to the vote or consent of the holders of the Shares
otherwise required by law, or any agreement between the Trust and any national
securities exchange.
11.7 Certain Transactions.
(a) Notwithstanding any other provision of this Declaration and
subject to the exceptions provided in paragraph (d) of this Section, the types
of transactions described in paragraph (c) of this Section shall require the
affirmative vote or consent of a majority of the Trustees then in office
followed by the affirmative vote of the holders of not less than seventy-five
percent (75%) of the Shares outstanding and entitled to vote, voting as a
single class, when a Principal Shareholder (as defined in paragraph (b) of
this Section) is a party to the transaction. Such affirmative vote or consent
shall be in addition to the vote or consent of the holders of Shares otherwise
required by law or by the terms of any class or series of preferred stock,
whether now or hereafter authorized, or any agreement between the Trust and
any national securities exchange.
(b) The term "Principal Shareholder" shall mean any corporation,
Person or other entity which is the beneficial owner, directly or indirectly,
of five percent (5%) or more of the outstanding Shares and shall include any
affiliate or associate, as such terms are defined in clause (ii) below, of a
Principal Shareholder. For the purposes of this Section, in addition to the
Shares which a corporation, Person or other entity beneficially owns directly,
(a) any corporation, Person or other entity shall be deemed to be the
beneficial owner of any Shares (i) which it has the right to acquire pursuant
to any agreement or upon exercise of conversion rights or warrants, or
otherwise (but excluding share options granted by the Trust) or (ii) which are
beneficially owned, directly or indirectly (including Shares deemed owned
through application of clause (i) above), by any other corporation, Person or
entity with which its "affiliate" or "associate" (as defined below) has any
agreement, arrangement or understanding for the purpose of acquiring, holding,
voting or disposing of Shares, or which is its "affiliate" or "associate" as
those terms are defined in Rule 12b-2 of the General Rules and Regulations
under the Exchange Act, and (b) the outstanding Shares shall include Shares
deemed owned through application of clauses (i) and (ii) above but shall not
include any other Shares which may be issuable pursuant to any agreement, or
upon exercise of conversion rights or warrants, or otherwise.
(c) This Section shall apply to the following transactions:
(i) the merger or consolidation of the Trust or any subsidiary
of the Trust with or into any Principal Shareholder;
(ii) the issuance of any securities of the Trust to any
Principal Shareholder for cash (other than pursuant to any automatic
dividend reinvestment plan);
(iii) the sale, lease or exchange of all or any substantial
part of the assets of the Trust to any Principal Shareholder (except
assets having an aggregate fair market value of less than $1,000,000,
aggregating for the purpose of such computation all assets sold,
leased or exchanged in any series of similar transactions within a
twelve-month period); or
(iv) the sale, lease or exchange to the Trust or any subsidiary
thereof, in exchange for securities of the Trust, of any assets of
any Principal Shareholder (except assets having an aggregate fair
market value of less than $1,000,000, aggregating for the purposes of
such computation all assets sold, leased or exchanged in any series
of similar transactions within a twelve-month period).
(d) The provisions of this Section shall not be applicable to (i) any
of the transactions described in paragraph (c) of this Section if 80% of the
Trustees shall by resolution have approved a memorandum of understanding with
such Principal Shareholder with respect to and substantially consistent with
such transaction, in which case approval by a Majority Shareholder Vote shall
be required, or (ii) any such transaction with any corporation of which a
majority of the outstanding shares of all classes of a stock normally entitled
to vote in elections of directors is owned of record or beneficially by the
Trust and its subsidiaries.
(e) The Board of Trustees shall have the power and duty to determine
for the purposes of this Section on the basis of information known to the
Trust whether (i) a corporation, person or entity beneficially owns five
percent (5%) or more of the outstanding Shares, (ii) a corporation, person or
entity is an "affiliate" or "associate" (as defined above) of another, (iii)
the assets being acquired or leased to or by the Trust or any subsidiary
thereof constitute a substantial part of the assets of the Trust and have an
aggregate fair market value of less than $1,000,000, and (iv) the memorandum
of understanding referred to in paragraph (d) hereof is substantially
consistent with the transaction covered thereby. Any such determination shall
be conclusive and binding for all purposes of this Section.
ARTICLE XII
Miscellaneous
12.1 Filing. This Declaration and any amendment hereto shall be filed
in such places as may be required or as the Trustees deem appropriate. Each
amendment shall be accompanied by a certificate signed and acknowledged by a
Trustee stating that such action was duly taken in a manner provided herein,
and shall, upon insertion in the Trust's minute book, be conclusive evidence
of all amendments contained therein. A restated Declaration, containing the
original Declaration and all amendments theretofore made, may, subject to the
second paragraph of Section 11.3(c), be executed from time to time by a
majority of the Trustees and shall, upon insertion in the Trust's minute book,
be conclusive evidence of all amendments contained therein and may thereafter
be referred to in lieu of the original Declaration and the various amendments
thereto.
12.2 Resident Agent. The Trust shall maintain a resident agent in the
State of Delaware, which agent shall initially be The Corporation Trust
Company, 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000. The Trustees may
designate a successor resident agent; provided, however, that such appointment
shall not become effective until written notice thereof is delivered to the
office of the Secretary of the State.
12.3 Governing Law. This Declaration is executed by the Trustees and
delivered in the State of Delaware and with reference to the laws thereof, and
the rights of all parties and the validity and construction of every provision
hereof shall be subject to and construed according to laws of said State and
reference shall be specifically made to the Delaware General Corporation Law
as to the construction of matters not specifically covered herein or as to
which an ambiguity exists, although such law shall not be viewed as limiting
the powers otherwise granted to the Trustees hereunder and any ambiguity shall
be viewed in favor of such powers.
12.4 Counterparts. This Declaration may be simultaneously executed in
several counterparts, each of which shall be deemed to be an original, and
such counterparts, together, shall constitute one and the same instrument,
which shall be sufficiently evidenced by any such original counterpart.
12.5 Reliance by Third Parties. Any certificate executed by an
individual who, according to the records of the Trust, or of any recording
office in which this Declaration may be recorded, appears to be a Trustee
hereunder, certifying to: (a) the number or identity of Trustees or
Shareholders, (b) the name of the Trust, (c) the due authorization of the
execution of any instrument or writing, (d) the form of any vote passed at a
meeting of Trustees or Shareholders, (e) the fact that the number of Trustees
or Shareholders present at any meeting or executing any written instrument
satisfies the requirements of this Declaration, (f) the form of any By-Laws
adopted by or the identity of any officers elected by the Trustees, or (g) the
existence of any fact or facts which in any manner relate to the affairs of
the Trust, shall be conclusive evidence as to the matters so certified in
favor of any person dealing with the Trustees and their successors.
12.6 Provisions in Conflict with Law or Regulation.
(a) The provisions of this Declaration are severable, and if the
Trustees shall determine, with the advice of counsel, that any of such
provisions is in conflict with the 1940 Act, the regulated investment company
provisions of the Code or with other applicable laws and regulations, the
conflicting provision shall be deemed never to have constituted a part of this
Declaration; provided, however, that such determination shall not affect any
of the remaining provisions of this Declaration or render invalid or improper
any action taken or omitted prior to such determination.
(b) If any provision of this Declaration shall be held invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall
attach only to such provision in such jurisdiction and shall not in any manner
affect such provision in any other jurisdiction or any other provision of this
Declaration in any jurisdiction.
IN WITNESS WHEREOF, the undersigned has caused these presents to be
executed as of the day and year first above written.
/s/ Xxxxxx X. Xxxxxx
---------------------------------
Xxxxxx X. Xxxxxx
Chairman of the Board and Trustee
/s/ Xxx Xxxxxxxxx
---------------------------------
Xxx Xxxxxxxxx
Trustee
/s/ Xxxx X. Xxxxx
---------------------------------
Xxxx X. Xxxxx
Trustee
/s/ Xxxxx X. Xxxxxxxxxxx
---------------------------------
Xxxxx X. Xxxxxxxxxxx
Trustee
