AMERICAN SKANDIA MASTER TRUST
AGREEMENT AND DECLARATION OF TRUST
THIS AGREEMENT AND DECLARATION OF TRUST, made this 5th day of March,
1997, by the Trustees hereunder (hereinafter with any additional and successor
trustees referred to as the "Trustees") and by the holders of Interests to be
issued hereunder as hereinafter provided.
W I T N E S S E T H:
WHEREAS, the Trustees have agreed to manage all property coming into
their hands as trustees of a Delaware business trust in accordance with the
provisions hereinafter set forth.
NOW, THEREFORE, the Trustees hereby declare that they will hold all cash,
securities and other assets, which they may from time to time acquire in any
manner as Trustees hereunder IN TRUST to manage and dispose of the same upon the
following terms and conditions for the pro rata benefit of the holders from time
to time of Interests, whether or not certificated, in this Trust as hereinafter
set forth.
ARTICLE I
NAME AND DEFINITIONS
Section 1. Name. This Trust shall be known as American
Skandia Master Trust and the Trustees shall conduct the business of
the Trust under that name or any other name as they may from time
to time determine
Section 2. Definitions. Whenever used herein, unless
otherwise required by the context or specifically provided:
(a) The term "Commission" shall have the meaning provided in
the 1940 Act;
(b) The "Trust" refers to the Delaware business trust established by
this Declaration of Trust, as amended from time to time;
(c) The term "Interestholder" shall mean a record owner of
Interests of the Trust;
(d) The term "Interests" shall mean the equal proportionate
non-transferable units of interest into which the beneficial interest in the
Trust shall be divided from time to time or, if more than one series or class of
Interests is authorized by the Trustees, the equal proportionate
non-transferable units into which each series or class of Interests shall be
divided from time to
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time, and includes a fraction of an Interest as well as a whole
Interest;
(e) The "1940 Act" refers to the Investment Company Act of 1940, and
the Rules and Regulations thereunder, all as amended from time to time;
(f) The term "Manager" is defined in Article IV, Section 5;
(g) The term "Person" shall mean an individual or any
corporation, partnership, joint venture, trust or other enterprise;
(h) "Declaration of Trust" shall mean this Agreement and
Declaration of Trust as amended or restated from time to time;
(i) "Bylaws" shall mean the Bylaws of the Trust as amended
from time to time;
(j) The term "series" or "series of Interests" refers to the one or
more separate investment portfolios of the Trust into which the assets and
liabilities of the Trust may be divided and the Interests of the Trust
representing the beneficial interest of Interestholders in such respective
portfolios;
(k) The term "class" or "class of Interests" refers to the division of
Interests representing any series into two or more classes as provided in
Article III, Section 1 hereof;
(l) The term "Delaware Act" shall mean the Delaware Business
Trust Act, 12 Del. C. xx.xx. 3801, et seq.; and
(m) The term "Bankruptcy" shall mean, with respect to any
Interestholder, any of the following:
(i) filing a voluntary petition in bankruptcy or for
reorganization or for the adoption of an arrangement under the
Bankruptcy Code (as now or in the future amended) or an admission
seeking the relief therein provided;
(ii) making a general assignment for the benefit of creditors;
(iii) consenting to the appointment of a receiver for all or a
substantial part of such Interestholder's property;
(iv) in the case of the filing of an involuntary petition in
bankruptcy, an entry of an order for relief;
(v) the entry of a court order appointing a receiver or
trustee for all or a substantial part of such Interestholder's
property without its consent; or
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(vi) the assumption of custody or sequestration by a court of
competent jurisdiction of all or substantially all of such
Interestholder's property.
(n) The term "Adjusted Basis" shall mean, with respect to any Security,
its adjusted basis for federal income tax purposes.
(o) The term "Adjusted Gross Asset Value" shall mean, with respect to a
Built-in Gain Security, the lesser of (i) the Gross Asset Value of such Security
on the day such Security is contributed to the Trust and (ii) the lowest Gross
Asset Value of such Security on any day thereafter, and, with respect to a
Built- in Loss Security, the higher of (i) the Gross Asset Value of such
Security on the day such Security is contributed to the Trust and (ii) the
highest Gross Asset Value of such Security on any day thereafter.
(p) The term "Appreciated Security" shall mean any Security held by the
Trust immediately before but on the same day as a new Interestholder is admitted
to the Trust if on such day the Gross Asset Value of such Security exceeds its
Adjusted Basis or if such Security is a Built-in Gain Security its Adjusted
Gross Asset Value.
(q) The term "Book Capital Account" shall mean, with respect to any
Interestholder, the Capital Account maintained for such Interestholder on a
daily basis in accordance with the following provisions:
(i) To each Interestholder's Book Capital Account there shall
be credited (a) the amount of money and the Gross Asset Value of
any property contributed by such Interestholder to the Trust, (b)
such Interestholder's distributive share of Net Income, (c) such
Interestholder's distributive share of Book Sales Gain, and (d)
the amount of any Trust liabilities assumed by such
Interestholder or which are secured by any property distributed
to such Interestholder.
(ii) To each Interestholder's Book Capital Account there shall
be debited (a) the amount of money and the Gross Asset Value of
any property distributed to such Interestholder pursuant to any
provision of this Agreement, (b) such Interestholder's
distributive share of Net Loss, (c) such Interestholder's
distributive share of Book Sales Loss, and (d) the amount of any
liabilities of such Interestholder assumed by the Trust or which
are secured by any property contributed by such Interestholder to
the Trust.
Any decisions relating to the maintenance of Book Capital Accounts
shall be made by the Trustees in any manner that reasonably reflects the purpose
and intention of this Agreement. In the event the Trustees shall determine that
it is prudent to
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modify the manner in which the Book Capital Accounts, or any debits or credits
thereto, are computed in order to reflect the purpose and intention of this
Agreement, the Trustee may make such modification.
(r) The terms "Book Sales Gain" or "Book Sales Loss" shall mean, for
any day, the difference, positive or negative, as the case may be, between (x)
the aggregate Gross Asset Value of all Securities held by the Trust at any time
during such day other than Securities acquired by the Trust on such day and (y)
the aggregate Gross Asset Value of all such Securities as determined for the
preceding day.
(s) The term "Built-in Gain Security" shall mean any Security
contributed by an Interestholder to the Trust if on the day such Security is
contributed to the Trust, its Gross Asset Value exceeds its Adjusted Basis.
(t) The term "Built-in Loss Security" shall mean any Security
contributed by an Interestholder to the Trust if on the day such Security is
contributed to the Trust, its Gross Asset Value is less than its Adjusted Basis.
(u) The term "Code", shall mean the Internal Revenue Code of 1986, as
amended from time to time (or any corresponding provisions of succeeding law).
(v) The term "Depreciated Security" shall mean any Security held by the
Trust immediately before but on the same day as a new Interestholder is admitted
to the Trust if on such day such Security's Gross Asset Value is less than its
Adjusted Basis or if such Security is a Built-in Loss Security its Adjusted
Gross Asset Value.
(w) The term "Gross Asset Value" shall mean, with respect to any
Security, the value of such Security determined as follows:
Securities are valued at the last sale price on the securities exchange
on which such securities are primarily traded or at the last sale price
on the national securities market. Securities not listed on an exchange
or national securities market, or securities in which there were no
transactions, are valued at the average of the most recent bid and
asked prices, except in the case of open short positions where the
asked price is used for valuation purposes. Short-term investments are
carried at amortized cost, which approximates value. Bid price is used
when no asked price is available. Market quotations for foreign
securities in foreign currencies are translated into U.S. dollars at
the prevailing rates of exchange. Any securities or other assets for
which recent market quotations are not readily available are valued at
fair market as determined in good faith by the Trustees. Securities
sold are valued for the day of sale at their net sales price.
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(x) The term "Modified Gross Asset Value" shall mean, with respect to
an Appreciated Security, the lesser of (i) the Gross Asset Value of such
Security on the day such Security became an Appreciated Security and (ii) the
lowest Gross Asset Value of such Security on any day thereafter, and, with
respect to a Depreciated Security, the higher of (i) the Gross Asset Value of
such Security on the day such Security became a Depreciated Security and (ii)
the highest Gross Asset Value of such Security on any day thereafter.
(y) The terms "Net Income" or "Net Loss" shall mean, for any day, the
sum, if positive, or if negative, as the case may be, of all items of income,
gain, deduction and loss (other than items included in computing Tax Sales Gain,
Tax Sales Loss, Remaining Built-in Gain, Remaining Built-in Loss, Remaining
Appreciated Gain or Remaining Depreciated Loss) recognized by the Trust on such
day for federal income tax purposes and determined in accordance with the
provisions of this Agreement.
(z) The term "Percentage Interest" shall mean, with respect to any
Interestholder, as of any day, the ratio (expressed as a percentage) of such
Interestholder's Book Capital Account as of the close of business on the
preceding day to the aggregate Book Capital Accounts of all Interestholders as
of the close of business on such preceding day, such Book Capital Accounts to be
determined after giving effect to all contributions, distributions, and
allocations through such preceding day.
(aa) The term "Positive Book/Tax Disparity" shall mean, with respect to
any Interestholder, the excess (if any) of such Interestholder's Book Capital
Account over the sum of such Interestholder's (i) Tax Capital Account, (ii)
Remaining Built-in Gain with respect to each Built-in Gain Security contributed
by such Interestholder to the Trust and (iii) share of Remaining Appreciated
Gain.
(bb) The term "Positive Tax/Book Disparity" shall mean, with respect to
any Interestholder, the excess (if any) of such Interestholder's Tax Capital
Account over the sum of such Interestholder's (i) Book Capital Account, (ii)
Remaining Built-in Loss with respect to each Built-in Loss Security contributed
by such Interestholder to the Trust and (iii) share of Remaining Depreciated
Gain.
(cc) The term "Regulations" shall mean the Income Tax Regulations,
including Temporary Regulations, promulgated under the Code, as such regulations
may be amended from time to time (including corresponding provisions of
succeeding regulations).
(dd) The term "Remaining Appreciated Gain" shall mean, with respect to
each Appreciated Security, the excess (if any) of such Security's Modified Gross
Asset Value over such Security's Adjusted Basis, or if such Security is a
Built-in Gain Security its Adjusted Gross Asset Value, on the day such Security
became an Appreciated
Security.
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(ee) The term "Remaining Built-in Gain" shall mean, with respect to
each Built-in Gain Security, the excess (if any) of such Security's Adjusted
Gross Asset Value over such Security's Adjusted Basis on the day such Security
is contributed to the Trust.
(ff) The term "Remaining Built-in Loss" shall mean, with respect to
each Built-in Loss Security, the excess (if any) of such Security's Adjusted
Basis on the day such Security is contributed to the Trust over such Security's
Adjusted Gross Asset Value.
(gg) The term "Remaining Depreciated Loss" shall mean, with respect to
each Depreciated Security, the excess (if any) of such Security's Adjusted
Basis, or if such Security is a Built-in Loss Security its Adjusted Gross Asset
Value, on the day such Security became a Depreciated Security over such
Security's Modified Gross Asset Value.
(hh) The term "Tax Capital Account" shall mean, with respect to any
Interestholder, the Capital Account maintained for such Interestholder on a
daily basis in accordance with the following provisions:
(i) To each Interestholder's Tax Capital Account there shall
be credited (a) the amount of money and the Adjusted Basis of any
property contributed by such Interestholder to the Trust, (b)
such Interestholder's distributive share of Net Income, (c) such
Interestholder's distributive share of Tax Sales Gain, and (d)
the amount of any Trust liabilities assumed by such
Interestholder or which are secured by any property distributed
to such Interestholder.
(ii) To each Interestholder's Tax Capital Account there shall
be debited (a) the amount of money and the Gross Asset Value of
any property distributed to such Interestholder pursuant to any
provision of this Agreement, (b) such Interestholder's
distributive share of Net Loss, (c) such Interestholder's
distributive share of Tax Sales Loss, and (d) the amount of any
liabilities of such Interestholder assumed by the Trust or which
are secured by any property contributed by such Interestholder to
the Trust.
Any decisions relating to the maintenance of Tax Capital Accounts shall
be made by the Trustees in any manner that reasonably reflects the purpose and
intention of this Agreement. In the event the Trustees shall determine that it
is prudent to modify the manner in which the Tax Capital Accounts, or any debits
or credits thereto, are computed in order to reflect the purpose and intention
of this Agreement, the Trustee may make such modification.
(ii) The terms "Tax Sales Gain" or "Tax Sales Loss" shall mean, for any
day, the sum, if positive, or if negative, as the
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case may be, of all items of gain or loss recognized by the Trust on such day
for federal income tax purposes from the sale or other disposition of Securities
(other than items of gain or loss included in Remaining Built-in Gain, Remaining
Built-in Loss, Remaining Appreciated Gain or Remaining Depreciated Loss with
respect to such Securities).
ARTICLE II
PURPOSES OF TRUST
This Trust is formed for the following purpose or purposes:
(a) to conduct, operate and carry on the business of an
investment company;
(b) to subscribe for, invest in, reinvest in, purchase or otherwise
acquire, hold, pledge, sell, assign, transfer, lend, write options on, exchange,
distribute or otherwise dispose of and deal in and with securities of every
nature, kind, character, type and form, including, without limitation of the
generality of the foregoing, all types of stocks, shares, futures contracts,
bonds, debentures, notes, bills and other negotiable or non-negotiable
instruments, obligations, evidences of interest, certificates of interest,
certificates of participation, certificates, interests, evidences of ownership,
guarantees, warrants, options or evidences of indebtedness issued or created by
or guaranteed as to principal and interest by any state or local government or
any agency or instrumentality thereof, by the United States Government or any
agency, instrumentality, territory, district or possession thereof, by any
foreign government or any agency, instrumentality, territory, district or
possession thereof, by any corporation organized under the laws of any state,
the United States or any territory or possession thereof or under the laws of
any foreign country, bank certificates of deposit, bank time deposits, bankers'
acceptances and commercial paper; to pay for the same in cash or by the issue of
stock, including treasury stock, bonds or notes of the Trust or otherwise; and
to exercise any and all rights, powers and privileges of ownership or interest
in respect of any and all such investments of every kind and description,
including, without limitation, the right to consent and otherwise act with
respect thereto, with power to designate one or more persons, firms,
associations or corporations to exercise any of said rights, powers and
privileges in respect of any said instruments;
(c) to borrow money or otherwise obtain credit and to secure the same
by mortgaging, pledging or otherwise subjecting as security the assets of the
Trust;
(d) to issue, sell, repurchase, redeem, retire, cancel, acquire, hold,
resell, reissue, dispose of, and otherwise deal in, Interests including
Interests in fractional denominations, and to apply to any such repurchase,
redemption, retirement, cancellation or acquisition of Interests any funds or
other assets of the appropriate series or class of Interests, whether capital or
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surplus or otherwise, to the full extent now or hereafter permitted
by the laws of the State of Delaware;
(e) to conduct its business, promote its purposes, and carry on its
operations in any and all of its branches and maintain offices both within and
without the State of Delaware, in any and all States of the United States of
America, in the District of Columbia, and in any other parts of the world; and
(f) to do all and everything necessary, suitable, convenient, or proper
for the conduct, promotion, and attainment of any of the businesses and purposes
herein specified or which at any time may be incidental thereto or may appear
conducive to or expedient for the accomplishment of any of such businesses and
purposes and which might be engaged in or carried on by a Trust organized under
the Delaware Act, and to have and exercise all of the powers conferred by the
laws of the State of Delaware upon a Delaware business trust.
The foregoing provisions of this Article II shall be construed both as
purposes and powers and each as an independent purpose and power.
ARTICLE III
BENEFICIAL INTEREST
Section 1. Interests. The Interests of the Trust are non-transferable
and shall be issued in one or more series as the Trustees may, without
Interestholder approval, authorize. Each series shall be separate from all other
series in respect of the assets and liabilities allocated to that series and
shall represent a separate investment portfolio of the Trust. The beneficial
interest in each series at all times shall be divided into Interests, with or
without par value as the Trustees may from time to time determine, each of which
shall, except as provided in the following sentence, represent an equal
proportionate interest in the series with each other Interest of the same
series, none having priority or preference over another. The Trustees may,
without Interestholder approval, divide Interests of any series into two or more
classes, Interests of each such class having such preferences and special or
relative rights and privileges (including without limitation, such redemption
rights, dividend rights, liquidation rights, voting rights and conversion
rights, if any) as the Trustees may determine. The number of Interests
authorized shall be unlimited, and the Interests so authorized may be
represented in part by fractional Interests. From time to time, the Trustees may
divide or combine the Interests of any series or class into a greater or lesser
number without thereby changing the proportionate beneficial interests in the
series or class.
All consideration received by the Trust for the issue or sale of Interests
of a particular series, together with all assets in which such consideration is
invested or reinvested, all income,
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earnings, profits, and proceeds thereof, including any proceeds derived from the
sale, exchange or liquidation of such assets, and any funds or payments derived
from any reinvestment of such proceeds in whatever form the same may be, shall
be held and accounted for separately from the other assets of the Trust and of
every other series and may be referred to herein as "assets of" that series. The
assets of a particular series shall belong to that series for all purposes, and
to no other series, subject only to the rights of creditors of that series. In
addition, any assets, income, earnings, profits or funds, or payments and
proceeds with respect thereto, which are not readily identifiable as belonging
to any particular series shall be allocated by the Trustees between and among
one or more of the series in such manner as the Trustees, in their sole
discretion, deem fair and equitable. Each such allocation shall be conclusive
and binding upon the Interestholders of all series for all purposes, and such
assets, income, earnings, profits or funds, or payments and proceeds with
respect thereto shall be assets of that series. The assets of a particular
series shall be so recorded upon the books of the Trust, and shall be held by
the Trustees in trust for the benefit of the holders of Interests of that
series. The assets of each particular series shall be charged with the
liabilities of that series and all expenses, costs, charges and reserves
attributable to that series. Any general liabilities, expenses, costs, charges
or reserves of the Trust which are not readily identifiable as belonging to any
particular series shall be allocated and charged by the Trustees between or
among any one or more of the series in such manner as the Trustees in their sole
discretion deem fair and equitable. Each such allocation shall be conclusive and
binding upon the Interestholders of all series for all purposes. Without
limitation of the foregoing provisions of this Section, but subject to the right
of the Trustees in their discretion to allocate general liabilities, expenses,
costs, charges or reserves as herein provided, the debts, liabilities,
obligations and expenses incurred, contracted for or otherwise existing with
respect to a particular series shall be enforceable against the assets of such
series only, and not against the assets of any other series. Notice of this
limitation on inter-series liabilities may, in the Trustees' sole discretion, be
set forth in the certificate of trust of the Trust (whether originally or by
amendment) as filed or to be filed in the Office of the Secretary of State of
the State of Delaware pursuant to the Delaware Act, and upon the giving of such
notice in the certificate of trust, the statutory provisions of Section 3804 of
the Delaware Act relating to limitations on inter- series liabilities (and the
statutory effect under Section 3804 of setting forth such notice in the
certificate of trust) shall become applicable to the Trust and each series.
Every note, bond, contract or other undertaking issued by or on behalf of a
particular series shall include a recitation limiting the obligation represented
thereby to that series and its assets. No Interestholder or former
Interestholder of any series shall have a claim on or any right to any assets
allocated or belonging to any other series.
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The Trustees shall be authorized to the extent necessary or appropriate
in their discretion to give effect to the preferences and special or relative
rights or privileges of all classes of shares in carrying out the foregoing
powers and, in furtherance of such authority, to allocate assets, income,
earnings, profits and funds and all expenses, costs, charges and reserves
attributable to a series to a particular class of shares of that series or to
apportion the same among two or more classes of shares of that series with the
same effect as allocations made between or among series.
The establishment and designation of any series or of any class of
Interests of any series shall be effective (i) upon the execution by a majority
of the Trustees of an instrument or the adoption in accordance with the terms
hereof of a resolution setting forth such establishment and designation of the
relative rights and preferences of the Interests of such series or class, (ii)
upon the execution of an instrument in writing by an officer of the Trust
pursuant to the vote of a majority of the Trustees, or (iii) as otherwise
provided in either such instrument. At any time that there are no Interests
outstanding of any particular series or class previously established and
designated, the Trustees may by an instrument executed by a majority of the
Trustees or the adoption in accordance with the terms hereof of a resolution (or
by an instrument executed by an officer of the Trust pursuant to the vote of a
majority of the Trustees) abolish that series or class and the establishment and
designation thereof. Each instrument or Trustees' resolution establishing and
designating any series or class shall have the status of an amendment to this
Declaration of Trust.
Section 2. Ownership of Interests. The ownership of Interests will be
recorded in the books of the Trust or a transfer agent. The record books of the
Trust or any transfer agent, as the case may be, shall be conclusive as to who
are the holders of Interests of each series and class and as to the number of
Interests of each series and class held from time to time by each. No
certificates certifying the ownership of Interests need be issued except as the
Trustees may otherwise determine from time to time.
Section 3. Issuance of Interests. The Trustees are authorized, from
time to time, to issue or authorize the issuance of Interests at not less than
the par value thereof, if any, and to fix the price or the minimum price or the
consideration (in cash and/or such other property, real or personal, tangible or
intangible, as from time to time they may determine) or minimum consideration
for such Interests, all without action or approval of the Interestholders.
Interests so issued shall be validly issued, fully paid and, subject to the
obligation of an Interestholder set forth in Section 6, nonassessable. Anything
herein to the contrary notwithstanding, the Trustees may issue Interests pro
rata to the Interestholders of a series at any time for no consideration as a
stock dividend, except to the extent otherwise required or permitted by the
preferences and special or relative rights and
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privileges of any classes of Interests of that series, and any stock dividend to
the Interestholders of a particular class of Interests shall be made to such
Interestholders pro rata in proportion to the number of Interests of such class
held by each of them.
Interests may be issued in fractional denominations to the same extent
as whole Interests, and Interests in fractional denominations shall be Interests
having proportionately to the respective fractions represented thereby all the
rights of whole Interests, including, without limitation, the right to vote, the
right to receive dividends and distributions, and the right to participate upon
liquidation of the Trust or of a particular series of Interests.
The Trustees may classify or re-classify any unissued Interests or
Interests previously issued and reacquired of any series or class thereof into
one or more series or classes thereof that may be established and designated
from time to time. The Trustees may hold as treasury Interests, re-issue for
such consideration and on such terms as they may determine, or cancel, in their
discretion from time to time, any interests of any series or class thereof
reacquired by the Trust.
Section 4. No Preemptive or Appraisal Rights; Derivative Suits.
Interestholders shall have no preemptive or appraisal or other right to
subscribe for any additional Interests or other securities issued by the Trust.
Interestholders shall have no right to demand payment for their Interests or any
other rights of dissenting shareholders in the event the Trust participates in
any transaction which would give rise to appraisal or dissenters' rights by a
shareholder of a corporation organized under the General Corporation Law of the
State of Delaware, or otherwise. No action may be brought by an Interestholder
on behalf of the Trust or a series unless Interestholders owning not less than
10 percent of the then outstanding Interests or series join in the bringing of
such action.
Section 5. Status of Interests and Limitation of Personal Liability.
Interests shall be deemed to be personal property giving only the rights
provided in this instrument. Every Person by virtue of having become registered
as an Interestholder on the books of the Trust pursuant to Section 3 of this
Article shall be held to have expressly assented and agreed to the terms hereof
and to be bound by this Declaration of Trust. The death of an Interestholder
during the continuance of the Trust shall not operate to terminate the same nor
entitle the representative of any deceased Interestholder to an accounting or to
take any action in court or elsewhere against the Trust or the Trustees, but
only to the rights of said decedent under this Trust. Ownership of Interests
shall not entitle the Interestholder to any title in or to the whole or any part
of the Trust property or right to call for a partition or division of the same
or for an accounting, nor shall the ownership of Interests constitute the
Interestholders partners.
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Interestholders of a series of the Trust shall be jointly and severally liable
(with rights of contribution inter se in proportion to their respective
interests in that series) for the liabilities and obligations of such series in
the event the Trust fails to satisfy such liabilities and obligations. Neither
the Trust nor the Trustees, nor any officer, employee or agent of the Trust
shall have any power to bind any Interestholder or Trustee personally or,
subject to the preceding sentence, to call upon any Interestholder for the
payment of any sum of money or assessment whatsoever other than such as the
Interestholder at any time personally may agree to pay by way of subscription
for any Interests or otherwise. Every note, bond, contract or other undertaking
issued by or on behalf of a particular series shall include a recitation
limiting the obligation represented thereby to that series and its assets.
ARTICLE IV
TRUSTEES
Section 1. Election. A Trustee may be elected either by the Trustees or
the Interestholders. The Trustees named herein shall serve until the first
meeting of the Interestholders or until the election and qualification of their
successors. Prior to the first meeting of Interestholders the initial Trustees
hereunder may elect additional Trustees to serve until such meeting and until
their successors are elected and qualified. The Trustees also at any time may
elect Trustees to fill vacancies in the number of Trustees. The number of
Trustees shall be fixed from time to time by the Trustees and, at or after the
commencement of the business of the Trust, shall be not less than three. Each
Trustee, whether named above or hereafter becoming a Trustee, shall serve as a
Trustee during the lifetime of this Trust, until such Trustee dies, resigns,
retires, or is removed, or, if sooner, until the next meeting of Interestholders
called for the purpose of electing Trustees and the election and qualification
of his successor. Subject to Section 16(a) of the 1940 Act, the Trustees may
elect their own successors and, pursuant to this Section, may appoint Trustees
to fill vacancies.
The Trustees shall have the power to set and modify the terms of office
of the Trustees and they may at any time make their terms of limited duration
and lengthen or shorten the terms so established.
Section 2. Powers. The Trustees shall have all powers necessary or
desirable to carry out the purposes of the Trust, including, without limitation,
the powers referred to in Article II hereof. Without limiting the generality of
the foregoing, the Trustees may adopt By-Laws not inconsistent with this
Declaration of Trust providing for the conduct of the business of the Trust and
may amend and repeal them to the extent that they do not reserve that right to
the Interestholders and such By-Laws are deemed to be incorporated and included
in this Declaration of Trust; they may
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fill vacancies in their number, including vacancies resulting from increases in
their own number, and may elect and remove such officers and employ, appoint and
terminate such employees or agents as they consider appropriate; they may
appoint from their own number and terminate any one or more committees; they may
employ one or more custodians of the assets of the Trust and may authorize such
custodians to employ subcustodians and to deposit all or any part of such assets
in a system or systems for the central handling of securities, retain a transfer
agent and an Interestholder servicing agent, or both, provide for the
distribution of Interests through a principal placement agent or otherwise, set
record dates, and in general delegate such authority as they consider desirable
(including, without limitation, the authority to purchase and sell securities
and to invest funds, to determine the net income of the Trust for any period,
the value of the total assets of the Trust and the net asset value of each
Interest, and to execute such deeds, agreements or other instruments either in
the name of the Trust or the names of the Trustees or as their attorney or
attorneys or otherwise as the Trustees from time to time may deem expedient) to
any officer of the Trust, committee of the Trustees, any such employee, agent,
custodian or underwriter or to any Manager.
Without limiting the generality of the foregoing, the Trustees shall have
full power and authority:
(a) To invest and reinvest cash and to hold cash uninvested;
(b) To vote or give assent, or exercise any rights of ownership, with
respect to stock or other securities or property; and to execute
and deliver proxies or powers of attorney to such person or
persons as the Trustees shall deem proper, granting to such
person or persons such power and discretion with relation to
securities or property as the Trustees shall deem proper;
(c) To hold any security or property in a form not indicating any
trust whether in bearer, unregistered or other negotiable form or
in the name of the Trust or a custodian, subcustodian or other
depository or a nominee or nominees or otherwise;
(d) To consent to or participate in any plan for the reorganization,
consolidation or merger of any corporation or concern, any
security of which is held in the Trust; to consent to any
contract, lease, mortgage, purchase or sale of property by such
corporation or concern, and to pay calls or subscriptions with
respect to any security held in the Trust;
(e) To join with other security holders in acting through a
committee, depositary, voting trustee or otherwise, and in that
connection to deposit any security with, or transfer any security
to, any such committee, depositary
NB128986.2
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or trustee, and to delegate to them such power and authority with
relation to any security (whether or not so deposited or
transferred) as the Trustees shall deem proper, and to agree to
pay, and to pay, such portion of the expenses and compensation of
such committee, depositary or trustee as the Trustees shall deem
proper;
(f) To compromise, arbitrate, or otherwise adjust claims in favor of
or against the Trust or any matter in controversy, including, but
not limited to, claims for taxes;
(g) Subject to the provisions of Article III, Section 1, to
allocate assets, liabilities, income and expenses of the
Trust to a particular series of Interests or to apportion
the same among two or more series, provided that any
liabilities or expenses incurred by a particular series
of Interests shall be payable solely out of the assets
and by the Interestholders of that series; and to the
extent necessary or appropriate to give effect to the
preferences and special or relative rights and privileges
of any classes of Interests, to allocate assets,
liabilities, income and expenses of a series to a
particular class of Interests of that series or to
apportion the same among two or more classes of Interests
of that series;
(h) To enter into joint ventures, general or limited
partnerships and any other combinations or associations;
(i) To purchase and pay for entirely out of Trust property
such insurance as they may deem necessary or appropriate
for the conduct of the business, including, without
limitation, insurance policies insuring the assets of the
Trust and payment of distributions and principal on its
portfolio investments, and insurance policies insuring
the Interestholders, Trustees, officers, employees,
agents, investment advisers or Managers, principal
underwriters, or independent contractors of the Trust
individually against all claims and liabilities of every
nature arising by reason of holding, being or having held
any such office or position, or by reason of any action
alleged to have been taken or omitted by any such person
as Interestholder, Trustee, officer, employee, agent,
investment adviser or Manager, principal underwriter, or
independent contractor, including any action taken or
omitted that may be determined to constitute negligence,
whether or not the Trust would have the power to
indemnify such person against such liability;
(j) To pay pensions for faithful service, as deemed appropriate by
the Trustees, and to adopt, establish and carry out pension,
profit-sharing, share bonus, share purchase, savings, thrift and
other retirement, incentive
NB128986.2
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and benefit plans, trusts and provisions, including the
purchasing of life insurance and annuity contracts as a means of
providing such retirement and other benefits, for any or all of
the Trustees, officers, employees and agents of the Trust;
(k) To establish a registered office and have a registered
agent in the State of Delaware;
(l) To establish separate and distinct series with separately defined
investment objectives and policies and separately defined
investment purposes in accordance with the provisions of Article
III hereof and to establish classes of such series having
relative rights, powers and duties as they may provide consistent
with applicable law;
(m) Subject to Article X, Section 9 hereof, to reorganize the
Trust; and
(n) Subject to Article X, Section 10 hereof, to sell all or
substantially all of the assets of the Trust or any series.
Further, without limiting the generality of the foregoing, the Trustees
shall have full power and authority to incur and pay out of the principal or
income of the Trust such expenses and liabilities as may be deemed by the
Trustees to be necessary or proper for the purposes of the Trust; provided,
however, that all expenses and liabilities incurred by or arising in connection
with a particular series or class of Interests, as determined by the Trustees,
shall be payable solely out of the assets and by the Interestholders of that
series or class.
Any determination made in good faith and, so far as accounting matters
are involved, in accordance with generally accepted accounting principles by or
pursuant to the authority granted by the Trustees, as to the amount of the
assets, debts, obligations or liabilities of the Trust, its Interestholders or a
particular series or class of Interests; the amount of any reserves or charges
set up and the propriety thereof; the time of or purpose for creating such
reserves or charges; the use, alteration or cancellation of any reserves or
charges (whether or not any debt, obligation or liability for which such
reserves or charges shall have been created shall have been paid or discharged
or shall be then or thereafter required to be paid or discharged); the price or
closing bid or asked price of any investment owned or held by the Trust or a
particular series; the market value of any investment or fair value of any other
asset of the Trust or a particular series; the number of Interests outstanding;
the estimated expense to the Trust or a particular series in connection with
purchases of its Interests; the ability to liquidate investments in an orderly
fashion; and the extent to which it is practicable to deliver a cross-section of
the portfolio of the Trust or a particular series in payment for any such
Interests, or as to any other matters
NB128986.2
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relating to the issue, sale, purchase and/or other acquisition or disposition of
investments or Interests of the Trust or a particular series or class , shall be
final and conclusive, and shall be binding upon the Trust or such series and its
Interestholders, past, present and future, and Interests are issued and sold on
the condition and understanding that any and all such determinations shall be
binding as aforesaid.
In construing the provisions of this Agreement, there shall be a
presumption in favor of the grant of authority and power to the Trustees.
Section 3. Meetings. At any meeting of the Trustees, a majority of the
Trustees then in office shall constitute a quorum. Any meeting may be adjourned
from time to time by a majority of the votes cast upon the question, whether or
not a quorum is present, and the meeting may be held as adjourned without
further notice.
When a quorum is present at any meeting, a majority of the Trustees
present may take any action, except when a larger vote is required by this
Declaration of Trust, the By-Laws or the 1940 Act.
Any action required or permitted to be taken at any meeting of the
Trustees or of any committee thereof may be taken without a meeting, if a
written consent to such action is signed by a majority of the Trustees or
members of any such committee then in office, as the case may be, and such
written consent is filed with the minutes of proceedings of the Trustees or any
such committee.
The Trustees or any committee designated by the Trustees may
participate in a meeting of the Trustees or such committee by means of a
conference telephone or similar communications equipment by means of which all
persons participating in the meeting can hear each other at the same time.
Participation by such means shall constitute presence in person at a meeting.
Notwithstanding anything to the contrary stated in this Section 3,
unless otherwise permitted under the 1940 Act, meetings of the Trustees to
approve advisory agreements or distribution arrangements shall be held in
person.
Section 4. Ownership of Assets of the Trust. Title to all of the assets
of each series of Interests of the Trust at all times shall be vested in the
Trust as a separate legal entity under the Delaware Act.
Section 5. Investment Advice and Management Services. The Trustees
shall not in any way be bound or limited by any present or future law or custom
in regard to investments by trustees. The Trustees from time to time may enter
into a written contract or contracts with any person or persons (herein called
the "Manager"), including any firm, corporation, trust or association in which
any Trustee or Interestholder may be interested, to act as investment advisers
and/or managers of the Trust and to provide such
NB128986.2
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investment advice and/or management as the Trustees from time to time may
consider necessary for the proper management of the assets of the Trust,
including, without limitation, authority to determine from time to time what
investments shall be purchased, held, sold or exchanged and what portion, if
any, of the assets of the Trust shall be held uninvested and to make changes in
the Trust's investments. Any such contract shall be subject to the requirements
of the 1940 Act with respect to its continuance in effect, its termination and
the method of authorization and approval of such contract, or any amendment
thereto or renewal thereof.
Any Trustee or any organization with which any Trustee may be
associated also may act as broker for the Trust in making purchases and sales of
securities for or to the Trust for its investment portfolio, and may charge and
receive from the Trust the usual and customary commission for such service. Any
organization with which a Trustee may be associated in acting as broker for the
Trust shall be responsible only for the proper execution of transactions in
accordance with the instructions of the Trust and shall be subject to no further
liability of any sort whatever.
The Trustees may also at any time and from time to time contract with
any party to appoint it exclusive or non-exclusive distributor or principal
underwriter for the Interests, every such contract to comply with such
requirements and restrictions as may be set forth in the By-laws or applicable
law, including the 1940 Act. Any such contract shall be subject to the
requirements of the 1940 Act with respect to its continuance in effect, its
termination and the method of authorization and approval of such contract, or
any amendment thereto or renewal thereof. The Manager, or any affiliate thereof,
also may be a distributor or principal underwriter or both for the sale of
Interests by separate contract or may be a person controlled by or affiliated
with any Trustee or any distributor, principal underwriter or a person in which
any Trustee or any distributor is interested financially, subject only to
applicable provisions of law. Nothing herein contained shall operate to prevent
any Manager, who also acts as such a distributor or principal underwriter, from
also receiving compensation for services in such capacity or capacities.
Section 6. Removal and Resignation of Trustees. The Trustees or the
Interestholders (by vote of 66-2/3% of the outstanding Interests entitled to
vote thereon) may remove at any time any Trustee with or without cause, and any
Trustee may resign at any time as Trustee, without penalty by written notice to
the Trust; provided that sixty days' advance written notice shall be given in
the event that there are only three or fewer Trustees at the time a notice of
resignation is submitted.
Section 7. Additional Provisions. The By-Laws may include
further provisions for Trustees' votes and meetings and related
matters not inconsistent with the provisions hereof.
NB128986.2
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ARTICLE V
INTERESTHOLDERS' VOTING POWERS AND MEETINGS
Section 1. Voting Powers. The Interestholders shall have power to vote
only (i) for the election of Trustees as provided in Article IV, Section 1, of
this Declaration of Trust; provided, however, that no meeting of Interestholders
is required to be called for the purpose of electing Trustees unless and until
such time as less than a majority of the Trustees have been elected by the
Interestholders, (ii) for the removal of Trustees as provided in Article IV,
Section 6, (iii) with respect to any Manager as provided in Article IV, Section
5, (iv) with respect to any amendment of this Declaration of Trust as provided
in Article X, Section 8, (v) with respect to the termination of the Trust or a
series or class of Interests as provided in Article X, Section 4, and (vi) with
respect to such additional matters relating to the Trust as may be required by
law, by this Declaration of Trust, or the By-Laws of the Trust or any
registration of the Trust with the Commission or any state, or as the Trustees
may consider desirable. Each whole Interest shall be entitled to one vote as to
any matter on which it is entitled to vote (except that in the election of
Trustees said vote may be cast for as many persons as there are Trustees to be
elected), and each fractional Interest shall be entitled to a proportionate
fractional vote. Notwithstanding any other provision of this Declaration of
Trust, on any matter submitted to a vote of Interestholders, all Interests of
the Trust then entitled to vote shall be voted in the aggregate as a single
class without regard to series or classes of Interests, except (i) when required
by the 1940 Act or when the Trustees shall have determined that the matter
affects one or more series or classes differently Interests shall be voted by
individual series or class and (ii) when the Trustees have determined that the
matter affects only the interests of one or more series or classes then only
Interestholders of such series or classes shall be entitled to vote thereon.
There shall be no cumulative voting in the election of Trustees. Interests may
be voted in person or by proxy. A proxy with respect to Interests held in the
name of two or more persons shall be valid if executed by any one of them,
unless at or prior to exercise of the proxy the Trust receives a specific
written notice to the contrary from any one of them. A proxy purporting to be
executed by or on behalf of an Interestholder shall be deemed valid unless
challenged at or prior to its exercise and the burden of proving invalidity
shall rest on the challenger. Whenever no Interests of any series or class are
issued and outstanding, the Trustees may exercise with respect to such series or
class all rights of Interestholders and may take any action required by law,
this Declaration of Trust or any By-Laws of the Trust to be taken by
Interestholders.
Section 2. Meetings. No annual or regular meeting of
Interestholders is required. Meetings of the Interestholders may
be called by the Trustees or such other person or persons as may be
specified in the By-Laws and shall be called by the Trustees upon
the written request of Interestholders owning at least 10% of the
NB128986.2
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outstanding Interests entitled to vote. Interestholders shall be
entitled to at least ten days' prior notice of any meeting.
Section 3. Quorum and Required Vote. Thirty percent (30%) of the
outstanding Interests shall be a quorum for the transaction of business at an
Interestholders' meeting, except that where any provision of law or of this
Declaration of Trust permits or requires that holders of any series or class
shall vote as a series or class, then thirty percent (30%) of the aggregate
number of Interests of that series or class entitled to vote shall be necessary
to constitute a quorum for the transaction of business by that series or class.
Any lesser number, however, shall be sufficient for adjournment and any
adjourned session or sessions may be held within 90 days after the date set for
the original meeting without the necessity of further notice. Except when a
larger vote is required by any provision of this Declaration of Trust or the
By-Laws of the Trust and subject to any applicable requirements of law, a
majority of the Interests voted shall decide any question, provided that where
any provision of law or of this Declaration of Trust permits or requires that
the holders of any series or class shall vote as a series or class, then a
majority of the Interests of that series or class voted on the matter shall
decide that matter insofar as that series or class is concerned.
Section 4. Action by Written Consent. Any action required or permitted
to be taken at any meeting may be taken without a meeting if a consent in
writing, setting forth such action, is signed by a majority of Interestholders
entitled to vote on the subject matter thereof (or such larger proportion
thereof as shall be required by any express provision of this Declaration of
Trust) and such consent is filed with the records of the Trust.
Section 5. Additional Provisions. The By-Laws may include
further provisions for Interestholders' votes and meetings and
related matters.
ARTICLE VI
ALLOCATIONS
Section 1. Net Income and Net Loss. For each day, Net Income or Net
Loss of the Trust, if any, will be allocated among the Interestholders, and
credited or charged, as the case may be, to their Book Capital Accounts and Tax
Capital Accounts, in accordance with their Percentage Interests on such day.
Section 2. Book Sales Gain and Book Sales Loss. For each day, Book
Sales Gain or Book Sales Loss of the Trust, if any, will be allocated among the
Interestholders, and credited or charged, as the case may be, to their Book
Capital Accounts, in accordance with their Percentage Interests on such day.
Section 3. Tax Sales Gain and Tax Sales Loss. For each day,
Tax Sales Gain or Tax Sales Loss of the Trust, if any, will be
NB128986.2
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allocated among the Interestholders, and credited or charged, as the case may
be, to their Tax Capital Accounts, as follows:
(a)Tax Sales Gain will be allocated, first, to those Interestholders
with Positive Book/Tax Disparities in proportion to and to the extent thereof,
second, to the Interestholders in such manner so as to eliminate as quickly as
possible any difference between the ratio (expressed as a percentage) of each
Interestholder's Positive Tax/Book Disparity to the aggregate Positive Tax/Book
Disparities of all Interestholders and such Interestholder's Percentage
Interest, and, thereafter, to all Interestholders in accordance with their
Percentage Interests.
(b)Tax Sales Loss will be allocated, first, to those Interestholders
with Positive Tax/Book Disparities in proportion to and to the extent thereof,
second, to the Interestholders in such manner so as to eliminate as quickly as
possible any difference between the ratio (expressed as a percentage) of each
Interestholder's Positive Book/Tax Disparity to the aggregate Positive Book/Tax
Disparities of all Interestholders and such Interestholder's Percentage
Interest, and, thereafter, to all Interestholders in accordance with their
Percentage Interests.
Section 4. Remaining Built-in Gain and Remaining Built-in Loss.
Whenever the Trust recognizes gain or loss for federal income tax purposes from
the sale or other disposition of a Security, any Remaining Built-in Gain or
Remaining Built-in Loss with respect to such Security shall be allocated to the
Interestholder who contributed such Security to the Trust.
Section 5. Remaining Appreciated Gain and Remaining
Appreciated Loss.
(a)For purposes of computing an Interestholder's Positive Book/Tax
Disparity or Positive Tax/Book Disparity, such Interestholder's share of
Remaining Appreciated Gain or Remaining Appreciated Loss with respect to an
Appreciated Security or a Depreciated Security shall be determined by such
Interestholder's Percentage Interest on the day such Security became an
Appreciated Security or a Depreciated Security.
(b)Whenever the Trust recognizes gain or loss for federal income tax
purposes from the sale or other disposition of a Security, any Remaining
Appreciated Gain or Remaining Depreciated Loss with respect to such Security
shall be allocated to the Interestholders in accordance with their Percentage
Interests on the day such Security became an Appreciated Security or a
Depreciated Security.
Section 6. Distribution In-kind. Whenever the Trust makes an in-kind
distribution of a Security to any Interestholder, such Security shall be treated
for all purposes of this Agreement as sold for an amount equal to the Gross
Asset Value of such Security on the day of distribution.
NB128986.2
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Section 7. Code Section 754 Adjustment. Whenever an adjustment to the
Adjusted Basis of any Trust Security pursuant to Code Section 734(b) or Code
Section 743(b) is required pursuant to Regulations Section 1.704-1(b)(iv)(m) to
be taken into account in determining capital accounts as the result of a
distribution to an Interestholder in complete liquidation of its interest in the
Trust, appropriate adjustments shall be made in the Tax Capital Accounts (and
related items) of Interestholders to reflect such adjustment. Any elections or
other decisions relating to allocations under this Article VI shall be made by
the Trustees in any manner that reasonably reflects the purpose and intention of
this Agreement. Allocations of Tax Sales Gain, Tax Sales Loss, Remaining
Built-in Gain, Remaining Built-in Loss, Remaining Appreciated Gain and Remaining
Depreciated Loss are solely for purposes of federal, state and local taxes and
shall not affect, or any way to be taken into account, in computing any
Interestholder's Book Capital Account or share of Book Sales Gain and Book Sales
Loss, other related items, or distributions pursuant to any provisions of this
Agreement.
ARTICLE VII
DISTRIBUTIONS AND REDEMPTIONS
Section 1. Distributions. The Trustees shall distribute periodically to
the Interestholders of each series of Interests an amount approximately equal to
the net income of that series, determined by the Trustees or as they may
authorize and as herein provided. Distributions of income may be made in one or
more payments, which shall be in Interests, cash or otherwise, and on a date or
dates and as of a record date or dates determined by the Trustees. At any time
and from time to time in their discretion, the Trustees also may cause to be
distributed to the Interestholders of any one or more series as of a record date
or dates determined by the Trustees, in Interests, cash or otherwise, all or
part of any gains realized on the sale or disposition of the assets of the
series or all or part of any other principal of the Trust attributable to the
series. Each distribution pursuant to this Section 1 shall be made ratably
according to the number of Interests of the series held by the several
Interestholders on the record date for such distribution, except to the extent
otherwise required or permitted by the preferences and special or relative
rights and privileges of any classes of Interests of that series, and any
distribution to the Interestholders of a particular class of Interests shall be
made to such Interestholders pro rata in proportion to the number of Interests
of such class held by each of them. No distribution need be made on Interests
purchased pursuant to orders received, or for which payment is made, after such
time or times as the Trustees may determine.
Section 2. Determination of Net Income. In determining the
net income of each series or class of Interests for any period,
there shall be deducted from income for that period (a) such
portion of all charges, taxes, expenses and liabilities due or
NB128986.2
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accrued as the Trustees shall consider properly chargeable and fairly applicable
to income for that period or any earlier period and (b) whatever reasonable
reserves the Trustees shall consider advisable for possible future charges,
taxes, expenses and liabilities which the Trustees shall consider properly
chargeable and fairly applicable to income for that period or any earlier
period. The net income of each series or class for any period may be adjusted
for amounts included on account of net income in the net asset value of
Interests issued or redeemed or repurchased during that period. In determining
the net income of a series or class for a period ending on a date other than the
end of its fiscal year, income may be estimated as the Trustees shall deem fair.
Gains on the sale or disposition of assets shall not be treated as income, and
losses shall not be charged against income unless appropriate under applicable
accounting principles, except in the exercise of the discretionary powers of the
Trustees. Any amount contributed to the Trust which is received as income
pursuant to a decree of any court of competent jurisdiction shall be applied as
required by the said decree.
Section 3. Redemptions. Any Interestholder shall be entitled to require
the Trust to redeem and the Trust shall be obligated to redeem at the option of
such Interestholder all or any part of the Interests owned by said
Interestholder, at the redemption price, pursuant to the method, upon the terms
and subject to the conditions hereinafter set forth:
(a)Certificates for Interests, if issued, shall be presented for
redemption in proper form for transfer to the Trust or the agent of the Trust
appointed for such purpose, and these shall be presented with a written request
that the Trust redeem all or any part of the Interests represented thereby.
(b)The redemption price per Interest shall be the net asset value per
Interest when next determined by the Trust at such time or times as the Trustees
shall designate, following the time of presentation of certificates for
Interests, if issued, and an appropriate request for redemption, or such other
time as the Trustees may designate in accordance with any provision of the 1940
Act, or any rule or regulation made or adopted by any securities association
registered under the Securities Exchange Act of 1934, as determined by the
Trustees, less any applicable charge or fee imposed from time to time as
determined by the Trustees.
(c)Net asset value of each series or class of Interests (for the
purpose of issuance of Interests as well as redemptions thereof) shall be
determined by dividing:
(i) the total value of the assets of such series or class
determined as provided in paragraph (d) below less, to the extent
determined by or pursuant to the direction of the Trustees in
accordance with generally accepted accounting principles, all
debts, obligations and liabilities of such series or class (which
debts,
NB128986.2
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obligations and liabilities shall include, without limitation of
the generality of the foregoing, any and all debts, obligations,
liabilities, or claims, of any and every kind and nature, fixed,
accrued and otherwise, including the estimated accrued expenses
of management and supervision, administration and distribution
and any reserves or charges for any or all of the foregoing,
whether for taxes, expenses, or otherwise, and the price of
Interests redeemed but not paid for) but excluding the Trust's
liability upon its Interests and its surplus, by
(ii) the total number of Interests of such series or
class outstanding.
The Trustees are empowered, in their absolute discretion, to establish
other methods for determining such net asset value whenever such other methods
are deemed by them to be necessary to enable the Trust to comply with applicable
law, or are deemed by them to be desirable, provided they are not inconsistent
with any provision of the 1940 Act.
(d)In determining for the purposes of this Declaration of Trust the
total value of the assets of each series or class of Interests at any time,
investments and any other assets of such series or class shall be valued in such
manner as may be determined from time to time by or pursuant to the order of the
Trustees.
(e)Payment of the redemption price by the Trust may be made either in
cash or in securities or other assets at the time owned by the Trust or partly
in cash and partly in securities or other assets at the time owned by the Trust.
The value of any part of such payment to be made in securities or other assets
of the Trust shall be the value employed in determining the redemption price.
Payment of the redemption price shall be made on or before the seventh day
following the day on which the Interests are properly presented for redemption
hereunder, except that delivery of any securities included in any such payment
shall be made as promptly as any necessary transfers on the books of the issuers
whose securities are to be delivered may be made, and except as postponement of
the date of payment may be permissible under the 1940 Act.
Pursuant to resolution of the Trustees, the Trust may deduct from the
payment made for any Interests redeemed a liquidating charge not in excess of an
amount determined by the Trustees from time to time.
(f)The right of any holder of Interests redeemed by the Trust as
provided in this Article VII to receive dividends or distributions thereon and
all other rights of such Interestholder with respect to such Interests shall
terminate at the time as of which the redemption price of such Interests is
determined, except the right of such Interestholder to, receive (i) the
redemption price of such Interests from the Trust in accordance with the
NB128986.2
23
provisions hereof, and (ii) any dividend or distribution to which such
Interestholder previously had become entitled as the record holder of such
Interests on the record date for such dividend or distribution.
(g)Redemption of Interests by the Trust is conditional upon the Trust
having funds or other assets legally available therefor.
(h)The Trust, either directly or through an agent, may repurchase its
Interests, out of funds legally available therefor, upon such terms and
conditions and for such consideration as the Trustees shall deem advisable, by
agreement with the owner at a price not exceeding the net asset value per
Interest as determined by or pursuant to the order of the Trustees at such time
or times as the Trustees shall designate, less any applicable charge, if and as
fixed by the Trustees from time to time, and to take all other steps deemed
necessary or advisable in connection therewith.
(i)Interests purchased or redeemed by the Trust shall be cancelled or
held by the Trust for reissue, as the Trustees from time to time may determine.
(j)The obligations set forth in this Article VII may be suspended or
postponed, (1) for any period (i) during which the New York Stock Exchange is
closed other than for customary weekend and holiday closings, or (ii) during
which trading on the New York Stock Exchange is restricted, (2) for any period
during which an emergency exists as a result of which (i) the disposal by the
Trust of investments owned by it is not reasonably practicable, or (ii) it is
not reasonably practicable for the Trust fairly to determine the value of its
net assets, or (3) for such other periods as the Commission or any successor
governmental authority by order may permit.
(k)Interestholders of a series of the Trust shall not be liable for
obligations of such series arising from conduct on a date or dates after the
date on which they have redeemed their Interests of that series of the Trust.
Notwithstanding any other provision of this Section 3 of Article VII,
if certificates representing such Interests have been issued, the redemption or
repurchase price need not be paid by the Trust until such certificates are
presented in proper form for transfer to the Trust or the agent of the Trust
appointed for such purpose; however, the redemption or repurchase shall be
effective, in accordance with the resolution of the Trustees, regardless of
whether or not such presentation has been made.
Section 4. Redemptions at the Option of the Trust. The Trust shall have
the right at its option and at any time to redeem Interests of any
Interestholder at the net asset value thereof as determined in accordance with
Section 3 of Article VII of this Declaration of Trust: (i) if at such time such
Interestholder owns fewer Interests than, or Interests having an aggregate net
asset
NB128986.2
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value of less than, an amount determined from time to time by the Trustees; or
(ii) to the extent that such Interestholder owns Interests of a particular
series or class of Interests equal to or in excess of a percentage of the
outstanding Interests of that series or class determined from time to time by
the Trustees; or (iii) to the extent that such Interestholder owns Interests of
the Trust representing a percentage equal to or in excess of such percentage of
the aggregate number of outstanding Interests of the Trust or the aggregate net
asset value of the Trust determined from time to time by the Trustees.
Section 5. Dividends, Distributions, Redemptions and Repurchases. No
dividend or distribution (including, without limitation, any distribution paid
upon termination of the Trust or of any series) with respect to, nor any
redemption or repurchase of, the Interests of any series or class shall be
effected by the Trust other than from the assets of such series or class.
Section 6. Power to Modify Foregoing Powers. Notwithstanding any of the
foregoing provisions of this Article VII, the Trustees may prescribe in their
absolute discretion such other bases and times for the declaration and payment
of dividends and distributions as they may deem desirable or may enable the
Trust to comply with or to obtain desirable treatment under any provision of the
1940 Act or the Code, including any rule or regulation adopted by the Commission
or any securities association registered under the Securities Exchange Act of
1934, as amended, or any order of exemption issued by the Commission or any rule
or regulation issued under the Code, all as in effect now or as hereafter
amended or modified.
ARTICLE VIII
COMPENSATION AND LIMITATION OF
LIABILITY OF TRUSTEES
Section 1. Compensation. The Trustees shall be entitled to
reasonable compensation from the Trust and may fix the amount of
their compensation.
Section 2. Limitation of Liability. A Trustee, when acting in such
capacity, shall not be personally liable to any person other than the Trust or
an Interestholder for any act, omission or obligation of the Trust or any
Trustee. The Trustees shall not be responsible or liable to the Trust or an
Interestholder in any event for any neglect or wrongdoing of any officer, agent,
employee or Manager of the Trust, nor shall any Trustee be responsible for the
act or omission of any other Trustee, but nothing herein contained shall protect
any Trustee against any liability to the Trust or an Interestholder to which he
would otherwise be subject by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of his
office.
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ARTICLE IX
INDEMNIFICATION
Section 1. Indemnification of Trustees, Officers, Employees and Agents.
Each person who is or was a Trustee, officer, employee or agent of the Trust or
who serves or has served at the Trust's request as a director, officer or
trustee of another person in which the Trust has or had any interest as a
shareholder, creditor or otherwise shall be entitled to indemnification out of
the assets of the Trust to the extent provided in, and subject to the provisions
of, the By-Laws, provided that no indemnification shall be granted by the Trust
in contravention of the 1940 Act.
Section 2. Merged Persons. For the purposes of this Article IX
references to "the Trust" include any constituent person (including any
constituent of a constituent) absorbed in a consolidation or merger which, if
its separate existence had continued, would have had power and authority to
indemnify its directors, trustees, officers, employees or agents as well as the
resulting or surviving person; so that any person who is or was a director,
trustee, officer, employee or agent of such a constituent person or is or was
serving at the request of such a constituent person as a trustee, director,
officer, employee or agent of another person shall stand in the same position
under the provisions of this Article IX with respect to the resulting or
surviving person as he would have with respect to such a constituent person if
its separate existence had continued.
Section 3. Interestholders. In case any Interestholder or former
Interestholder shall be held to be personally liable solely by reason of his
being or having been an Interestholder and not because of his acts or omissions
or for some other reason, the Interestholder or former Interestholder (or his
heirs, executors, administrators or other legal representatives or in the case
of a corporation or other entity, its corporate or other general successor)
shall be entitled out of the assets of the particular series of Interests of
which he is or was an Interestholder to be held harmless from and indemnified
against all losses and expenses arising from such liability. Upon request, the
Trust shall cause its counsel to assume the defense of any claim which, if
successful, would result in an obligation of the Trust to indemnify the
Interestholder as aforesaid.
ARTICLE X
OTHER GENERAL PROVISIONS
Section 1. Trustee's Good Faith Action, Expert Advice, No Bond or
Surety. The exercise by the Trustees of their powers and discretion hereunder
under the circumstances then prevailing, shall be binding upon everyone
interested. Subject to Article VIII, Section 2 hereof, a Trustee shall be liable
for his or her own willful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of the office of
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Trustee, and for nothing else, and shall not be liable for errors of judgment or
mistakes of fact or law. The Trustees may take advice of counsel or other
experts with respect to the meaning and operation of this Declaration of Trust
or otherwise with respect to the management of the Trust, and subject to the
provisions of Section 2 of Article VIII shall be under no liability for any act
or omission in accordance with such advice or for failing to follow such advice.
The Trustees shall not be required to give any bond as such, nor any surety if a
bond is required.
Section 2. Liability of Third Persons Dealing with Trustees. No person
dealing with the Trustees shall be bound to make any inquiry concerning the
validity of any transaction made or to be made by the Trustees pursuant hereto
or to see to the application of any payments made or property transferred to the
Trust or upon its order.
Section 3. Trustees, Officers, etc. Not Personally Liable; Notice. All
persons extending credit to, contracting with or having any claim against the
Trust, or a particular series of Interests, shall look only to the assets of the
Trust and the Interestholders to the extent set forth in Article III, Section 6
hereof, or the assets and the Interestholders of that particular series of
Interests, for payment under such credit, contract or claim; and neither the
Trustees nor any of the Trust's officers, employees or agents, whether past,
present or future, shall be personally liable therefor. Every note, bond,
contract, instrument, certificate, share, or undertaking and every other act or
thing whatsoever executed or done by or on behalf of the Trust or the Trustees
or any of them in connection with the Trust, shall be deemed conclusively to
have been executed or done only in their or his capacity as Trustees or Trustee,
and such Trustees or Trustee shall not be personally liable thereon. Every note,
bond, contract or other undertaking issued by or on behalf of a particular
series shall include a recitation limiting the obligation represented thereby to
that series and its assets.
Section 4. Termination of Trust. Unless terminated as provided herein,
the Trust shall continue without limitation of time. The Trust may be terminated
at any time by vote of Interestholders holding at least a majority of the
Interests of each series entitled to vote or by the Trustees by written notice
to the Interestholders. Any series or class of Interests may be terminated at
any time by vote of Interestholders holding at least a majority of the Interests
of such series or class entitled to vote or by the Trustees by written notice to
the Interestholders of such series or class.
Upon termination of the Trust or of any one or more series or class of
Interests, after paying or otherwise providing for all charges, taxes, expenses
and liabilities, whether due or accrued or anticipated as may be determined by
the Trustees, the Trust shall reduce, in accordance with such procedures as the
Trustees consider appropriate, the remaining assets to distributable form in
cash or
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shares or other securities, or any combination thereof, and distribute the
proceeds to the Interestholders of the series or class involved, ratably
according to the number of Interests of such series or class held by the several
Interestholders of such series or class on the date of termination, except to
the extent otherwise required or permitted by the preferences and special or
relative rights and privileges of any classes of Interests of that series,
provided that any distribution to the Interestholders of a particular class of
Interests shall be made to such Interestholders pro rata in proportion to the
number of Interests of such class held by each of them.
Upon termination of the Trust, following completion of winding up of
its business, the Trustees shall cause a certificate of cancellation of the
Trust's certificate of trust to be filed in accordance with Section 3810 of the
Delaware Act, which certificate of cancellation may be signed by any one
Trustee.
Section 5. Filing of Copies, References, Headings. The initial Trustees
shall file a certificate of Trust of the Trust with the Secretary of State of
the State of Delaware in accordance with Section 3810 of the Delaware Act. The
original or a copy of this instrument and of each amendment hereto and of each
Declaration of Trust supplemental hereto shall be kept at the office of the
Trust where it may be inspected by any Interestholder. Anyone dealing with the
Trust may rely on a certificate by an officer of the Trust as to whether or not
any such amendments or supplemental Declarations of Trust have been made and as
to matters in connection with the Trust hereunder; and, with the same effect as
if it were the original, may rely on a copy certified by an officer of the Trust
to be a copy of this instrument or of any such amendment or supplemental
Declaration of Trust. In this instrument or in any such amendment or
Supplemental Declaration of Trust, references to this instrument, and all
expressions like "herein," "hereof," and "hereunder," shall be deemed to refer
to this instrument as amended or affected by any such amendment or supplemental
Declaration of Trust. Headings are placed herein for convenience of reference
only and in case of any conflict, the text of this instrument, rather than the
headings, shall control. This instrument may be executed in any number of
counterparts each of which shall be deemed an original. This instrument shall
not become effective until a counterpart has been executed by each Trustee.
Section 6. Applicable Law. This Declaration of Trust shall be governed
by and construed in accordance with the laws of the State of Delaware. The trust
created hereby shall be a business trust created under, and subject to the
provisions of, the Delaware Act and may exercise all powers which are ordinarily
exercised by such a trust under the Delaware Act; provided, however, that there
shall not be applicable to the Trust, the Trustees, the Interestholders or this
Declaration of Trust (a) the provisions of Section 3540 of Title 12 of the
Delaware Code or (b) any provisions of the Laws (statutory or common) of the
State of Delaware (other
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than the Delaware Act) pertaining to trusts which are inconsistent with the
rights, duties, powers, limitations or liabilities of the Trustees set forth or
referenced in this Declaration of Trust.
Section 7. Amendments. Except as specifically provided herein, the
Trustees may, without Interestholder vote, amend or otherwise supplement this
Declaration of Trust by an instrument in writing signed by a majority of the
Trustees; provided, however, the Interestholders shall have the right to vote
(a) on any amendment which would affect their right to vote granted in Section 1
of Article V hereof, (b) on any amendment to this Section, (c) on any amendment
as may be required by the 1940 Act and (d) on any amendment submitted to them by
the Trustees. Without limiting the generality of the foregoing, amendments
having the purpose of changing the name of the Trust or of supplying any
omission, curing any ambiguity or curing, correcting or supplementing any
provision which is defective or inconsistent with the 1940 Act or with the
requirements of the Code and the regulations thereunder for the Trust's
obtaining desirable treatment thereunder available to regulated investment
companies shall not require authorization by shareholder vote. Any amendment
required or permitted to be submitted to the Interestholders which, as the
Trustees determine, shall affect the Interestholders of one or more series or
class shall be authorized by vote of the Interestholders of each series or class
affected and no vote of Interestholders of a series or class not affected shall
be required.
Section 8. Reorganization. Notwithstanding anything else herein, the
Trustees, in order to change the form of organization of the Trust, may, without
Interestholder approval, (a) cause the Trust to merge or consolidate with or
into one or more trusts, partnerships, associations or corporations so long as
the surviving or resulting entity is an investment company under the 1940 Act,
or is a series thereof, or (b) cause the Trust or any series thereof to
incorporate under the laws of the State of Delaware. Any agreement of merger or
consolidation or certificate of merger may be signed by a majority of the
Trustees and facsimile signatures conveyed by electronic or telecommunication
means shall be valid.
Pursuant to and in accordance with the provisions of Section 3815(f) of
the Delaware Act, and notwithstanding anything else herein, an agreement of
merger or consolidation approved by the Trustees in accordance with this Section
may effect any amendment to this Declaration of Trust or effect the adoption of
a new declaration of trust of the Trust if it is the surviving or resulting
trust in the merger or consolidation.
Section 9. Sale of Assets. Notwithstanding anything else herein, the
Trustees may, without Interestholder approval, sell and convey all or
substantially all of the assets of the Trust or any series to one or more
trusts, partnerships, associations or corporations so long as the transferee is
an investment company under the 1940 Act, or is a series thereof. Any sale shall
be for such consideration as the Trustees, in their absolute discretion,
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deem adequate and may include the assumption of all outstanding obligations,
taxes and other liabilities, accrued or contingent, of the Trust or any series
and may include shares of beneficial interest, stock or other ownership interest
of the transferee or of a series thereof.
Section 10. Acquisition of Assets. In connection with the acquisition
of all or substantially all the assets or stock of another investment company,
[investment trust or a company classified as a personal holding company under
the Code,] the Trustees may issue or cause to be issued shares of a series or
class and accept in payment therefor in lieu of cash such assets at their market
value or such stock at the market value of the assets held by such investment
company, [investment trust or personal holding company] with or without
adjustment for contingent costs or liabilities.
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IN WITNESS WHEREOF, each of the undersigned Trustees has hereunto set
his/her hand for himself/herself and his/her assigns as of the day and year
first above written.
Trustee
Trustee
Trustee
STATE OF _______ )
: ss.:
COUNTY OF _______ )
On this 5th day of March, 1997, before me personally came the above-named
Trustees of the Fund, to me known, and known to me to be the persons described
in and who executed the foregoing instrument and who duly acknowledged to me
that they had executed the same.
Notary Public
NB128986.2
