BLACK PEARL FUNDS
AGREEMENT AND DECLARATION OF TRUST
TABLE OF CONTENTS
Page
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ARTICLE I. THE TRUST
Section 1.1 Name 1
Section 1.2 Trust Purpose 1
Section 1.3 Definitions 2
ARTICLE II. TRUSTEES
Section 2.1 Number and Qualification 3
Section 2.2 Term and Election 3
Section 2.3 Resignation and Removal 4
Section 2.4 Vacancies 4
Section 2.5 Meetings 4
Section 2.6 Officers; Chairman of the Board 5
Section 2.7 By-Laws 5
ARTICLE III. POWERS OF TRUSTEES
Section 3.1 General 5
Section 3.2 Investments 6
Section 3.3 Legal Title 6
Section 3.4 Sale of Interests 6
Section 3.5 Borrow Money 7
Section 3.6 Delegation; Committees 7
Section 3.7 Collection and Payment 7
Section 3.8 Expenses 7
Section 3.9 Miscellaneous Powers 7
Section 3.10 Further Powers 8
ARTICLE IV. INVESTMENT ADVISORY, ADMINISTRATIVE SERVICES
AND PLACEMENT AGENT ARRANGEMENTS
Section 4.1 Investment Advisory and Other
Arrangements 8
Section 4.2 Parties to Contract 8
ARTICLE V. LIMITATIONS OF LIABILITY
Section 5.1 No Personal Liability of Trustees,
Officers, Employees, Agents 8
Section 5.2 Indemnification of Trustees,
Officers, Employees, Agents 9
Section 5.3 Liability of Holders; Indemnification 9
Section 5.4 No Bond Required of Trustees 10
Section 5.5 No Duty of Investigation; Notice
in Trust Instruments, Etc 10
Section 5.6 Reliance on Experts, Etc 10
Section 5.7 Assent To Declaration 10
ARTICLE VI. INTERESTS IN THE TRUST
Section 6.1 Interests 10
Section 6.2 Rights of Holders 10
Section 6.3 Register of Interests 11
Section 6.4 Notices 11
Section 6.5 No Pre-emptive Rights; Derivative Suits 11
Section 6.6 No Appraisal Rights 11
ARTICLE VII. PURCHASES AND REDEMPTIONS
Section 7.1 Purchases 11
Section 7.2 Redemption by Holder 11
Section 7.3 Redemption by Trust 12
Section 7.4 Net Asset Value 12
ARTICLE VIII. HOLDERS
Section 8.1 Meetings of Holders 12
Section 8.2 Notice of Meetings 13
Section 8.3 Record Date for Meetings 13
Section 8.4 Proxies, Etc 13
Section 8.5 Reports 13
Section 8.6 Inspection of Records 14
Section 8.7 Voting Powers 14
Section 8.8 Series of Interests 14
Section 8.9 Holder Action by Written Consent 16
Section 8.10 Holder Communications 16
ARTICLE IX. DURATION; TERMINATION OF TRUST;
AMENDMENT; MERGERS; ETC
Section 9.1 Duration 17
Section 9.2 Termination of Trust 17
Section 9.3 Amendment Procedure 17
Section 9.4 Merger, Consolidation and Sale of Assets 18
Section 9.5 Incorporation 18
ARTICLE X. MISCELLANEOUS
Section 10.1 Certificate of Designation; Agent
for Service of Process 19
Section 10.2 Governing Law 19
Section 10.3 Counterparts 19
Section 10.4 Reliance by Third Parties 19
Section 10.5 Provisions in Conflict With Law
or Regulations 20
Section 10.6 Trust Only 20
Section 10.7 Withholding 20
Section 10.8 Headings and Construction 20
AGREEMENT AND DECLARATION OF TRUST OF
BLACK PEARL FUNDS
This AGREEMENT AND DECLARATION OF TRUST is made by the initial trustee(s)
of the Black Pearl Funds in the City of San Xxxx, the State of California, this
6th day of July, 2005.
WITNESSETH:
WHEREAS, Black Pearl Funds has been formed to carry on the business of an
investment company; and
WHEREAS, the Trust is authorized to issue its Shares of beneficial interest
in separate series, each separate series to be a Portfolio hereunder, and to
issue Classes of Shares of any Portfolio or divide Shares of any Portfolio into
two or more Classes, all in accordance with the provisions hereinafter set
forth; and
WHEREAS, the Trustees have agreed to manage all property coming into their
hands as trustees of a Delaware statutory trust in accordance with the
provisions hereinafter set forth.
AGREEMENT:
NOW, THEREFORE, the Trustees hereby declare that they will hold IN TRUST
all cash, securities and other assets which the Trust may from time to time
acquire and manage and dispose of the same upon the following terms and
conditions for the pro rata benefit of the Shareholders in the Trust and the
Portfolios created hereunder as hereinafter set forth.
ARTICLE I. THE TRUST
SECTION I.1 NAME. The name of the trust shall be "Black Pearl Funds", and
so far as may be practicable the Trustees shall conduct the Trust's activities,
execute all documents and xxx or be sued under that name, which name (and the
word "Trust" wherever hereinafter used) shall not refer to the Trustees in their
individual capacities or to the officers, agents, employees or holders of
Interest in the Trust. However, should the Trustees determine that the use of
the name of the Trust is not advisable, they may select such other name for the
Trust as they deem proper and the Trust may hold its property and conduct its
activities under such other name. Any name change shall become effective upon
the execution by a majority of the then Trustees of an instrument setting forth
the new name and the filing of a certificate of amendment pursuant to Section
3810(b) of Title 12 of the Delaware Code (the "DBTA"). Any such instrument shall
not require the approval of the holders of Interests in the Trust, but shall
have the status of an amendment to this Declaration.
SECTION I.2 TRUST PURPOSE. The purpose of the Trust is to conduct, operate
and carry on the business of an open-end management investment company
registered under the Investment Company Act of 1940, as amended (the "1940
Act"). In furtherance of the foregoing, it shall be the purpose of the Trust to
do everything necessary, suitable, convenient or proper for the conduct,
promotion and attainment of any businesses and purposes which at any time may be
incidental or may appear conducive or expedient for the accomplishment of the
business of an open-end management investment company registered under the 1940
Act and which may be engaged in or carried on by a trust organized under the
DBTA and in connection therewith the Trust shall have and may exercise all of
the powers conferred by the laws of the State of Delaware upon a Delaware
statutory trust.
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SECTION I.3 DEFINITIONS. As used in this Declaration, the following terms
shall have the following meanings:
(a) "1940 Act" shall mean the Investment Company Act of 1940, as amended
from time to time, and the rules and regulations thereunder, as adopted or
amended from time to time.
(b) "Affiliated Person", "Assignment" and "Interested Person" shall have
the meanings given them in the 1940 Act.
(c) "Administrator" shall mean any party furnishing services to the Trust
pursuant to an administrative services contract as described in Article IV
hereof.
(d) "By-Laws" shall mean the By-Laws of the Trust as amended from time to
time.
(e) "Class" means any division of shares of a Series. A Series may have a
single named or unnamed Class, or multiple Classes.
(f) "Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and the rules and regulations thereunder, as adopted or amended
from time to time.
(g) "Commission" shall mean the Securities and Exchange Commission.
(h) "Declaration" shall mean this Declaration of Trust as amended from time
to time. References in this Declaration to "Declaration", "hereof", "herein",
and "hereunder" shall be deemed to refer to the Declaration rather than the
article or section in which such words appear. This Declaration shall, together
with the Trust's By-Laws, constitute the governing instrument of the Trust under
the DBTA.
(i) "DBTA" shall mean the Delaware Statutory Trust Act, Delaware Code
Annotated Title 12, Sections 3801 et seq., as amended from time to time.
(j) "Fiscal Year" shall mean an annual period as determined by the Trustees
unless otherwise provided by the Code or applicable regulations.
(k) "Holders" shall mean as of any particular time any or all holders of
record of Interests in the Trust or in Trust Property, as the case may be, at
such time.
(l) "Interest" shall mean a Holder's units of interest into which the
beneficial interest in the Trust and each Series or each Class of the Trust
shall be divided from time to time.
(m) "Investment Adviser" shall mean any party furnishing services to the
Trust pursuant to an investment advisory contract as described in Article IV
hereof.
(n) "Majority Interests Vote" shall mean the vote, at a meeting of the
Holders of Interests, of the lesser of , (A) 67% or more of the Interests
present or represented at such meeting, provided the Holders of more than 50% of
the Interests are present or represented by proxy or (B) more than 50% of the
interest.
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(o) "Person" shall mean and include an individual, corporation,
partnership, trust, association, joint venture and other entity, whether or not
a legal entity, and a government and agencies and political subdivisions
thereof.
(p) "Registration Statement" as of any particular time shall mean the
Registration Statement of the Trust that is effective at such time under the
1940 Act.
(q) "Series" refers to each series of the Trust established and designated
under or in accordance with the provisions of this Trust.
(r) "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.
(s) "Trustees" shall mean such persons who are indemnified as trustees of
the Trust on the signature page of this Declaration, so long as they shall
continue in office in accordance with the terms of this Declaration of Trust,
and all other persons who at the time in question have been duly elected or
appointed as trustees in accordance with the provisions of this Declaration of
Trust and are then in office, in their capacity as trustees hereunder.
ARTICLE II. TRUSTEES
SECTION II.1 NUMBER AND QUALIFICATION. The number of Trustees shall
initially be 1 and shall thereafter be fixed from time to time by written
instrument signed by a majority of the Trustees so fixed then in office;
provided, however, that the number of Trustees shall in no event be less than
one. A Trustee shall be an individual at least 21 years of age who is not under
legal disability.
(a) Any vacancy created by an increase in Trustees shall be filled by the
appointment or election of an individual having the qualifications described in
this Article as provided in Section 2.4. Any such appointment shall not become
effective, however, until the individual appointed or elected shall have
accepted in writing such appointment or election and agreed in writing to be
bound by the terms of the Declaration. No reduction in the number of Trustees
shall have the effect of removing any Trustee from office.
(b) Whenever a vacancy in the number of Trustees shall occur, until such
vacancy is filled as provided in Section 2.4 hereof, 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.
SECTION II.2 TERM AND ELECTION. Each Trustee named herein, or elected or
appointed prior to the first meeting of the Holders, shall (except in the event
of resignations or removals or vacancies pursuant to Section 2.3 or 2.4 hereof)
hold office until his or her successor has been elected at such meeting and has
qualified to serve as Trustee. Beginning with the Trustees elected at the first
meeting of Holders, each Trustee shall hold office during the lifetime of this
Trust and until its termination as hereinafter provided unless such Trustee
resigns or is removed as provided in Section 2.3 below.
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SECTION II.3 RESIGNATION AND REMOVAL. Any Trustee may resign (without need
for prior or subsequent accounting by an instrument in writing signed by him or
her and delivered or mailed to 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.
(a) Any of the Trustees may be removed with or without cause by the
affirmative vote of the Holders of two-thirds (2/3) of the Interests or
(provided the aggregate number of Trustees, after such removal and after giving
effect to any appointment made to fill the vacancy created by such removal,
shall not be less than the number required by Section 2.1 hereof) with cause, by
the action of two-thirds (2/3) of the remaining Trustees. Removal with cause
shall include, but not be limited to, the removal of a Trustee due to physical
or mental incapacity.
(b) Upon the resignation or removal of a Trustee, or his or her otherwise
ceasing to be a Trustee, he or she 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 the resigning
or removed Trustee. Upon the death of any Trustee or upon removal or resignation
due to any Trustee's incapacity to serve as trustee, his or her legal
representative shall execute and deliver on his or her behalf such documents as
the remaining Trustees shall require as provided in the preceding sentence.
SECTION II.4 VACANCIES. The term of office of a Trustee shall terminate and
a vacancy shall occur in the event of the death, resignation, adjudicated
incompetence or other incapacity to perform the duties of the office, or
removal, of a Trustee. A vacancy shall also occur in the event of an increase in
the number of Trustees as provided in Section 2.1. No such vacancy shall operate
to annul this Declaration or to revoke any existing trust created pursuant to
the terms of this Declaration. In the case of a vacancy, the Holders of at least
a majority of the Interests entitled to vote, acting at any meeting of the
Holders held in accordance with Section 8.1 hereof, or, to the extent permitted
by the 1940 Act, a majority vote of the Trustees continuing in office acting by
written instrument or instruments, may fill such vacancy, and any Trustee so
elected by the Trustees or the Holders shall hold office as provided in this
Declaration. There shall be no cumulative voting by the Holders in the election
of Trustees.
SECTION II.5 MEETINGS. Meetings of the Trustees shall be held from time to
time within or without the State of Delaware upon the call of the Chairman, if
any, the President, the Chief Operating Officer, the Secretary, an Assistant
Secretary or any two Trustees.
(a) 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 not later than 72 hours preceding the
meeting by United States mail or by electronic transmission to each Trustee at
his business address as set forth in the records of the Trust or otherwise given
personally not less than 24 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 lawfully
called or convened.
(b) A quorum for all meetings of the Trustees shall be one-third of the
total number of Trustees, but (except at such time as there is only one Trustee)
no less than two Trustees. Unless provided otherwise in this Declaration, 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
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meeting by written consent of a majority of the Trustees, which written consent
shall be filed with the minutes of proceedings of the Trustees or any such
committee. If there be less than a quorum present at any meeting of the
Trustees, a majority of those present may adjourn the meeting until a quorum
shall have been obtained.
(c) 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 two or more of the members thereof, unless the Board shall
provide otherwise. 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 by written consent
of a majority of the members, which written consent shall be filed with the
minutes of proceedings of the Trustees or any such committee.
(d) With respect to actions of the Trustees and any committee of the
Trustees, Trustees who are Interested Persons of the Trust or are otherwise
interested in any action to be taken may be counted for quorum purposes under
this Section 2.5 and shall be entitled to vote to the extent permitted by the
1940 Act.
(e) 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, and participation in a meeting pursuant to such
communications system shall constitute presence in person at such meeting,
unless the 1940 Act specifically requires the Trustees to act "in person" in
which case such term shall be construed consistent with Commission or staff
releases or interpretations.
SECTION II.6 OFFICERS; CHAIRMAN OF THE BOARD. The Trustees shall, from time
to time, elect officers of the Trust, including a President, a Secretary and a
Treasurer. The Trustees shall elect or appoint, from time to time, a Trustee to
act as Chairman of the Board who shall preside at all meetings of the Trustees
and carry out such other duties as the Trustees shall designate. The Trustees
may elect or appoint or authorize the President to appoint such other officers
or agents with such powers as the Trustees may deem to be advisable. The
President, Secretary and Treasurer may, but need not, be a Trustee. The Chairman
of the Board and such officers of the Trust shall serve in such capacity for
such time and with such authority as the Trustees may, in their discretion, so
designate or as provided by in the By-Laws.
SECTION II.7 BY-LAWS. The Trustees may adopt and, from time to time, amend
or repeal the By-Laws for the conduct of the business of the Trust not
inconsistent with this Declaration and such By-Laws are hereby incorporated in
this Declaration by reference thereto.
ARTICLE III. POWERS OF TRUSTEES
SECTION III.1 GENERAL. The Trustees shall have exclusive and absolute
control over management of the business and affairs of the Trust, but with such
powers of delegation as may be permitted by this Declaration and the DBTA. The
Trustees may perform such acts as in their sole discretion are proper for
conducting the business and affairs of the Trust. The enumeration of any
specific power herein shall not be construed as limiting the aforesaid power.
Such powers of the Trustee may be exercised without order of or recourse to any
court.
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SECTION III.2 INVESTMENTS. The Trustees shall have power to:
(a) 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 United States and foreign currencies and related instruments
including forward contracts, and securities, including common and preferred
stock, warrants, bonds, debentures, time notes and all other evidences of
indebtedness, negotiable or nonnegotiable instruments, obligations, certificates
of deposit or indebtedness, commercial paper, repurchase agreements, reverse
repurchase agreements, convertible securities, forward contracts, options,
futures contracts, and other securities, including, without limitation, those
issued, guaranteed or sponsored by any state, territory or possession of the
United States and the District of Columbia and their political subdivisions,
agencies and instrumentalities, or by the United States Government, any foreign
government, or any agency, instrumentality or political subdivision of the
United States Government or any foreign government, or international
instrumentalities, or by any bank, savings institution, corporation or other
business entity organized under the laws of the United States or under foreign
laws; 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 of said instruments; and the Trustees shall be
deemed to have the foregoing powers with respect to any additional securities in
which the Trustees may determine to invest.
The Trustees shall not be limited to investing in obligations maturing
before the possible termination of the Trust, nor shall the Trustees be limited
by any law limiting the investments which may be made by fiduciaries.
SECTION III.3 LEGAL TITLE. Legal title to all the Trust Property shall be
vested in the Trust as a separate legal entity under the DBTA, except that the
Trustees shall have the 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 any
other Person on behalf of the Trust on such terms as the Trustees may determine.
In the event that title to any part of the Trust Property is vested in one
or more Trustees, 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 or her due election and qualification. Upon the resignation,
removal or death of a Trustee he or she 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. To the extent permitted by law, such vesting and cessation
of title shall be effective whether or not conveyancing documents have been
executed and delivered.
SECTION III.4 SALE OF INTERESTS. Subject to the more detailed provisions
set forth in Article VII, the Trustees shall have the power to permit persons to
purchase Interests and to add or reduce, in whole or in part, their Interest in
the Trust.
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SECTION III.5 BORROW MONEY. The Trustees shall have power 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, 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.
SECTION III.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.
SECTION III.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; to prosecute, defend, compromise or abandon any
claims relating to the Trust Property; to foreclose any security interest
securing any obligations, by virtue of which any property is owned to the Trust;
and to enter into releases, agreements and other instruments.
SECTION III.8 EXPENSES. The Trustees shall have the power to incur and pay
any expenses which in the opinion of the Trustees are necessary or incidental to
carry out any of the purposes of this Declaration, 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 and
brokerage services, as they in good faith may deem reasonable (subject to any
limitations in the 1940 Act), and reimbursement for expenses reasonably incurred
by themselves on behalf of the Trust.
SECTION III.9 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 and terminate such employees or
contractual relationships as they consider appropriate; (b) enter into joint
ventures, partnerships and any other combinations or associations; (c) purchase,
and pay for out of Trust Property, insurance policies (including, but not
limited to, fidelity bonding and errors and omission policies) insuring the
Investment Adviser, Administrator, Distributor, Holders, Trustees, officers,
employees, agents, 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 the Trust would
have the power to indemnify such Person against liability; (d) establish
pension, profit-sharing and other retirement, incentive and benefit plans for
all Trustees, officers, employees and agents of the Trust; (e) to the extent
permitted by law, indemnify any Person with whom the Trust has dealings,
including the Investment Adviser, Administrator, Distributor, Holders, Trustees,
officers, employees, agents or independent contractors of the Trust, to such
extent as the Trustees shall determine; (f) guarantee indebtedness or
contractual obligations of others; (g) determine and change the Fiscal Year of
the Trust and the method by which its accounts shall be kept; and (h) 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.
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SECTION III.10 FURTHER POWERS. The Trustees shall have power to conduct the
business of the Trust and carry on its operations in any and all of its branches
and maintain offices, whether within or without the State of Delaware, in any
and all states of the United States of America, in the District of Columbia, in
any foreign countries, and in any and all commonwealths, territories,
dependencies, colonies, possessions, agencies or instrumentalities of the United
States of America and of foreign countries, 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 and shall be
binding upon the Trust and the Holders, past, present and future. In construing
the provisions of this Declaration, the presumption shall be in favor of a grant
of power to the Trustees. The Trustees shall not be required to obtain any court
order to deal with Trust Property.
ARTICLE IV. INVESTMENT ADVISORY, ADMINISTRATIVE SERVICES AND
PLACEMENT AGENT ARRANGEMENTS
SECTION IV.1 INVESTMENT ADVISORY AND OTHER ARRANGEMENTS. The Trustees may
in their discretion, from time to time, enter into contracts or agreements for
investment advisory services, administrative services (including transfer and
dividend disbursing agency services), fiduciary (including custodian) services,
placement agent services, Holder servicing and distribution services or other
services, whereby the other party to such contract or agreement shall undertake
to furnish the Trustees such services 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 other provisions of this
Declaration to the contrary, the Trustees may authorize any Investment Adviser
(subject to such general or specific instructions as the Trustees may, from time
to time, adopt) to effect purchases, sales, loans or exchanges of Trust Property
on behalf of the Trustees or may authorize any officer, employee or Trustee to
effect such purchases, sales, loans or exchanges pursuant to recommendations of
any such Investment Adviser (all without further action by the Trustees). Any
such purchases, sales, loans and exchanges shall be binding upon the Trust.
SECTION IV.2 PARTIES TO CONTRACT. Any contract or agreement of the
character described in Section 4.1 of this Article IV or in the By-Laws of the
Trust may be entered into with any Person, although one or more of the Trustees
or officers of the Trust or any Holder may be an officer, director, trustee,
shareholder, or member of such other party to the contract or agreement, and no
such contract or agreement 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 such contract or agreement or
accountable for any profit realized directly or indirectly therefrom, provided
that the contract or agreement when entered into was reasonable and fair and not
inconsistent with the provisions of this Article IV or the By-Laws. Any Trustee
or officer of the Trust or any Holder may be the other party to contracts or
agreements entered into pursuant to Section 4.1 hereof or the By-Laws of the
Trust, and any Trustee or officer of the Trust or any Holder may be financially
interested or otherwise affiliated with Persons who are parties to any or all of
the contracts or agreements mentioned in this Section 4.2.
ARTICLE V. LIMITATIONS OF LIABILITY
SECTION V.1 NO PERSONAL LIABILITY OF TRUSTEES, OFFICERS, EMPLOYEES, AGENTS.
No Trustee, officer, employee or agent of the Trust when acting in such capacity
shall
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be subject to any personal liability whatsoever, in his or her individual
capacity, to any Person, other than the Trust or its Holders, in connection with
Trust Property or the affairs of the Trust; and all such Persons shall look
solely to the Trust Property for satisfaction of claims of any nature against a
Trustee, officer, employee or agent of the Trust arising in connection with the
affairs of the Trust. No Trustee, officer, employee or agent of the Trust shall
be liable to the Trust, Holders of Interests therein, or to any Trustee,
officer, employee, or agent thereof for any action or failure to act (including,
without limitation, the failure to compel in any way any former or acting
Trustee to redress any breach of trust) except for his or her own bad faith,
willful misfeasance, gross negligence or reckless disregard of his or her
duties.
SECTION V.2 INDEMNIFICATION OF TRUSTEES, OFFICERS, EMPLOYEES, AGENTS. The
Trust shall indemnify each of its Trustees, officers, employees, and agents
(including Persons who serve at its request as directors, officers or trustees
of another organization in which it has an interest, as a shareholder, creditor
or otherwise) against all liabilities and expenses (including amounts paid in
satisfaction of judgments, in compromise, as fines and penalties, and as counsel
fees) reasonably incurred by him or her in connection with the defense or
disposition of any action, suit or other proceeding, whether civil or criminal,
in which he or she may be involved or with which he or she may be threatened,
while in office or thereafter, by reason of his or her being or having been such
a Trustee, officer, employee or agent, except with respect to any matter as to
which he or she shall have been adjudicated to have acted in bad faith, willful
misfeasance, gross negligence or reckless disregard of his or her duties;
provided, however, that as to any matter disposed of by a compromise payment by
such Person, pursuant to a consent decree or otherwise, no indemnification
either for said payment or for any other expenses shall be provided unless there
has been a determination that such Person did not engage in willful misfeasance,
bad faith, gross negligence or reckless disregard of the duties involved in the
conduct of his or her office by the court or other body approving the settlement
or other disposition or by a reasonable determination, based upon review of
readily available facts (as opposed to a full trial-type inquiry), that he or
she did not engage in such conduct by written opinion from independent legal
counsel approved by the Trustees. The rights accruing to any Person under these
provisions shall not exclude any other right to which he or she may be lawfully
entitled; provided that no Person may satisfy any right of indemnity or
reimbursement granted herein or in Section 5.1 or to which he or she may be
otherwise entitled except out of the Trust Property. The Trustees may make
advance payments in connection with indemnification under this Section 5.2,
provided that the indemnified Person shall have given a written undertaking to
reimburse the Trust in the event it is subsequently determined that he or she is
not entitled to such indemnification.
SECTION V.3 LIABILITY OF HOLDERS; INDEMNIFICATION. The Trust shall
indemnify and hold each Holder harmless from and against any claim or liability
to which such Holder may become subject solely by reason of his or her being or
having been a Holder and not because of such Holder's acts or omissions or for
some other reason, and shall reimburse such Holder for all legal and other
expenses reasonably incurred by him or her in connection with any such claim or
liability (upon proper and timely request by the Holder); provided, however,
that no Holder shall be entitled to indemnification by any Series established in
accordance with Section 8.8 unless such Holder is a Holder of Interests of such
Series. The rights accruing to a Holder under this Section 5.3 shall not exclude
any other right to which such Holder may be lawfully entitled, nor shall
anything herein contained restrict the right of the Trust to indemnify or
reimburse a Holder in any appropriate situation even though not specifically
provided herein.
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SECTION V.4 NO BOND REQUIRED OF TRUSTEES. No Trustee shall, as such, be
obligated to give any bond or surety or other security for the performance of
any of his or her duties hereunder.
SECTION V.5 NO DUTY OF INVESTIGATION; NOTICE IN TRUST INSTRUMENTS, ETC. No
purchaser, lender, or other Person dealing with the Trustees or 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, instrument, certificate
or other interest or undertaking 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, officers, employees or agents of the Trust. Every written obligation,
contract, instrument, certificate or other interest or undertaking of the Trust
made by the Trustees or by any officer, employee or agent of the Trust, in his
or her capacity as such, shall contain an appropriate recital to the effect that
the Trustee, officer, employee and agent of the Trust shall not personally be
bound by or liable thereunder, nor shall resort be had to their private property
or the private property of the Holders for the satisfaction of any obligation or
claim thereunder, and appropriate references shall be made therein to the
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, officers, employees or agents of the
Trust. The Trustees may maintain insurance for the protection of the Trust
Property, Holders, Trustees, officers, employees and agents in such amount as
the Trustees shall deem advisable.
SECTION V.6 RELIANCE ON EXPERTS, ETC. Each Trustee and officer or employee
of the Trust shall, in the performance of his or her 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 its officers or employees or by any Investment Adviser, Administrator,
accountant, appraiser or other experts or consultants 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.
SECTION V.7 ASSENT TO DECLARATION. Every Holder, by virtue of having become
a Holder in accordance with the terms of this Declaration, shall be held to have
expressly assented and agreed to the terms hereof and to have become a party
hereto.
ARTICLE VI. INTERESTS IN THE TRUST
SECTION VI.1 INTERESTS. The beneficial interests in the property of the
Trust shall consist of an unlimited number of Interests. No certificates
certifying the ownership of Interests need be issued except as the Trustees may
otherwise determine from time to time.
SECTION VI.2 RIGHTS OF HOLDERS. The ownership of the Trust Property of
every description and the right to conduct any business hereinbefore described
are vested exclusively in the Trust or the Trustees, and the Holders shall have
no right or title therein other than the beneficial interest conferred by their
Interests and they shall have no right to call for any partition or division of
any property, profits or rights of the Trust. The Interests shall be personal
property giving only the rights specifically set forth in this Declaration.
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SECTION VI.3 REGISTER OF INTERESTS. A register shall be kept by the Trust
under the direction of the Trustees which shall contain the names and addresses
of the Holders and Interests held by each Holder. Each such register shall be
conclusive as to the identity of the Holders of the Trust and the Persons who
shall be entitled to payments of distributions or otherwise to exercise or enjoy
the rights of Holders. No Holder shall be entitled to receive payment of any
distribution, nor to have notice given to it as herein provided, until it has
given its address to such officer or agent of the Trustees as shall keep the
said register for entry thereon.
SECTION VI.4 NOTICES. Any and all notices to which any Holder hereunder may
be entitled and any and all communications shall be deemed duly served or given
if mailed, postage prepaid, addressed to any Holder of record at its last known
address as recorded on the register of the Trust.
SECTION VI.5 NO PRE-EMPTIVE RIGHTS; DERIVATIVE SUITS. Holders shall have no
preemptive or other right to subscribe to any additional Interests or other
securities issued by the Trust or any Series thereof. No action may be brought
by a Holder on behalf of the Trust unless Holders owning no less than 10% of the
then outstanding Interests join in the bringing of such action.
SECTION VI.6 NO APPRAISAL RIGHTS. Holders shall have no right to demand
payment for their Interests or to any other rights of dissenting Holders in the
event the Trust participates in any transaction which would give rise to
appraisal or dissenters' rights by a holder of a corporation organized under the
General Corporation Law of Delaware, or otherwise.
ARTICLE VII. PURCHASES AND REDEMPTIONS
SECTION VII.1 PURCHASES. The Trustees, in their discretion, may, from time
to time, without a vote of the Holders, permit the purchase of Interests by such
party or parties (or increase in the interests of a Holder) and for such type of
consideration, including, without limitation, cash or property, at such time or
times (including, without limitation each business day), and on such terms as
the Trustees may deem best, and may in such manner acquire other assets
(including, without limitation, the acquisition of assets subject to, and in
connection with the assumption of liabilities) and businesses.
SECTION VII.2 REDEMPTION BY HOLDER. Each Holder of Interest of the Trust or
any Series or Class thereof shall have the right at such times as may be
permitted by the Trust to require the Trust to redeem all or any part of his or
her Interests of the Trust or Series or Class thereof at a redemption price
equal to the net asset value per Interest of the Trust or Series or Class
thereof next determined in accordance with Section 7.4 hereof after the
Interests are properly tendered for redemption, subject to any contingent
deferred sales charge in effect at the time of redemption. Payment of the
redemption price shall be in cash; provided, however, that if the Trustees
determine, which determination shall be conclusive, that conditions exist which
make payment wholly in cash unwise or undesirable, the Trust may, subject to the
requirements of the 1940 Act, make payment wholly or partly in securities or
other assets belonging to the Trust or Series thereof of which the Interests
being redeemed are part of the value of such securities or assets used in such
determination of net asset value.
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Notwithstanding the foregoing, the Trust may postpone payment of the
redemption price and may suspend the right of the Holders of Interests of the
Trust or Series or Class thereof to require the Trust to redeem Shares of the
Trust or Series or Class during any period or at any time when and to the extent
permissible under the 1940 Act.
SECTION VII.3 REDEMPTION BY TRUST. Each Interest of the Trust or Series
or Class thereof that has been established and designated is subject to
redemption by the Trust at the redemption price which would be applicable if
such Interest was then being redeemed by the Holder pursuant to Section 7.2
hereof: (i) at any time, if the Trustees determine in their sole discretion and
by majority vote that failure to so redeem may have materially adverse
consequences to the Trust or any Series or to the Holders of the Interests of
the Trust or any Series or Class thereof, or (ii) upon such other conditions as
may from time to time be determined by the Trustees and set forth in the then
current Prospectus of the Trust with respect to maintenance of Holder accounts
of a minimum amount. Upon such redemption the Holders of the Interests so
redeemed shall have no further right with respect thereto other than to receive
payment of such redemption price.
SECTION VII.4 NET ASSET VALUE. The net asset value per Interest of any
Series shall be (i) in the case of a Series whose Interests are not divided into
Classes, the quotient obtained by dividing the value of the net assets of that
Series (being the value of the assets belonging to that Series less the
liabilities belonging to that Series) by the total number of Interests of that
Series outstanding, and (ii) in the case of a Class of Interests of a Series
whose Interests are divided into Classes, the quotient obtained by dividing the
value of the net assets of that Series allocable to such Class (being the value
of the assets belonging to that Series allocable to such Class less the
liabilities belonging to such Class) by the total number of Interests of such
Class outstanding; all determined in accordance with the methods and procedures,
including without limitation those with respect to rounding, established by the
Trustees from time to time.
The Trustees may determine to maintain the net asset value per Interest of
any Series at a designated constant dollar amount and in connection therewith
may adopt procedures consistent with the 1940 Act for continuing declarations of
income attributable to that Series or Class thereof as dividends payable in
additional Interests of that Series or Class thereof at the designated constant
dollar amount and for the handling of any losses attributable to that Series or
Class.
ARTICLE VIII. HOLDERS
SECTION VIII.1 MEETINGS OF HOLDERS. Meetings of the Holders may be called
at any time by a majority of the Trustees and shall be called by any Trustee
upon written request of Holders holding, in the aggregate, not less than 10% of
the Interests, such request specifying the purpose or purposes for which such
meeting is to be called. Any such meeting shall be held within or without the
State of Delaware on such day and at such time as the Trustees shall designate.
Holders of one-third of the Interests in the Trust, present in person or by
proxy, shall constitute a quorum for the transaction of any business, except as
may otherwise be required by the 1940 Act or other applicable law or by this
Declaration or the By-Laws of the Trust. If a quorum is present at a meeting, an
affirmative vote by the Holders present, in person or by proxy, holding more
than 50% of the total Interests of the Holders present, either in person or by
proxy, at such meeting constitutes the action of the Holders, unless the 1940
Act, other applicable law, this Declaration or the By-Laws of the Trust requires
a greater number of affirmative votes.
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SECTION VIII.2 NOTICE OF MEETINGS. Written or printed notice of all
meetings of the Holders, stating the time, place and purposes of the meeting,
shall be given by the Trustees either by presenting it personally to a Holder,
leaving it at his or her residence or usual place of business, or by sending it
via United States mail or by electronic transmission to a Holder, at his or her
registered address, at least 10 business days and not more than 90 business days
before the meeting. If mailed, such notice shall be deemed to be given when
deposited in the United States mail addressed to the Holder at his or her
address as it is registered with the Trust, with postage thereon prepaid. At any
such meeting, any business properly before the meeting may be considered whether
or not stated in the notice of the meeting. Any adjourned meeting may be held as
adjourned without further notice.
SECTION VIII.3 RECORD DATE FOR MEETINGS. For the purpose of determining the
Holders who are entitled to notice of any meeting and to vote at any meeting, or
to participate in any distribution, or for the purpose of any other action, the
Trustees may from time to time fix a date, not more than 90 calendar days prior
to the date of any meeting of the Holders or payment of distributions or other
action, as the case may be, as a record date for the determination of the
persons to be treated as holders of record for such purposes. If the Trustees
shall divide the Trust Property into two or more Series and Classes in
accordance with Section 8.8 herein, nothing in this Section 8.3 shall be
construed as precluding the Trustees from setting different record dates for
different Series and Classes.
SECTION VIII.4 PROXIES, ETC. At any meeting of Holders, any Holder entitled
to vote thereat may vote by 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.
(a) 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 of
the Trust. Only Holders of record shall be entitled to vote. Each Holder shall
be entitled to a vote proportionate to its Interest in the Trust.
(b) When Interests are held jointly by several persons, any one of them may
vote at any meeting in person or by proxy in respect of such Interest, 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 Interest.
(c) A proxy purporting to be executed by or on behalf of a Holder 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 is a minor or a
person of unsound mind, and subject to guardianship or to the legal control of
any other person regarding the charge or management of its Interest, he or she
may vote by his or her guardian or such other person appointed or having such
control, and such vote may be given in person or by proxy.
SECTION VIII.5 REPORTS. The Trustees shall cause to be prepared, at least
annually, a report of operations containing a balance sheet and statement of
income and undistributed income of the Trust prepared in conformity with
generally accepted accounting principles and an opinion of an independent public
accountant on such financial statements. The Trustees shall, in addition,
furnish to the Holders at least semi-annually interim reports containing an
unaudited
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balance sheet as of the end of such period and an unaudited statement of income
and surplus for the period from the beginning of the current Fiscal Year to the
end of such period.
SECTION VIII.6 INSPECTION OF RECORDS. The records of the Trust shall be
open to inspection by Holders during normal business hours and for any purpose
not harmful to the Trust.
SECTION VIII.7 VOTING POWERS. The Holders shall have power to vote only (a)
for the election of Trustees as contemplated by Section 2.2 hereof, (b) with
respect to any investment advisory contract as contemplated by Section 4.1
hereof, (c) with respect to termination of the Trust as provided in Section 9.2
hereof, (d) with respect to any merger, consolidation or sale of assets as
provided in Section 9.4 hereof, (e) with respect to incorporation of the Trust
to the extent and as provided in Section 9.5 hereof, (f) with respect to such
additional matters relating to the Trust as may be required by the 1940 Act,
DBTA, or any other applicable law, the Declaration, the By-Laws or any
registration of the Trust with the Commission (or any successor agency) or any
state, or as and when the Trustees may consider necessary or desirable.
Each Holder shall be entitled to vote based on the ratio its Interest bears
to the Interests of all Holders entitled to vote. Until Interests are issued,
the Trustees may exercise all rights of Holders and may take any action required
by law, the Declaration or the By-Laws to be taken by Holders, The By-Laws may
include further provisions for Holders' votes and meetings and related matters
not inconsistent with this Declaration.
SECTION VIII.8 SERIES OF INTERESTS. The Trustees shall have the power to
divide the Trust Property into two or more Series and may further divide each
Series into separate Classes. The following provisions shall be applicable to
such Series and Classes and any further Series and Classes that may from time to
time be established and designated by the Trustees:
(a) All consideration received by the Trust for the issue or sale of
Interests of a particular Series or Class together with all Trust Property in
which such consideration is invested or reinvested, all income, earnings,
profits, and proceeds thereof, including any proceeds derived from the sale,
exchange or liquidation of such assets, and any funds or payments derived from
any reinvestment of such proceeds in whatever form the same may be, shall
irrevocably belong to that Series or Class for all purposes, subject only to the
rights of creditors of such Series or Class and except as may otherwise be
required by applicable tax laws, and shall be so recorded upon the books of
account of the Trust. In the event that there is any Trust Property, or any
income, earnings, profits, and proceeds thereof, funds, or payments which are
not readily identifiable as belonging to any particular Series or Class, the
Trustees shall allocate them among any one or more of the Series or Class
established and designated from time to time in such manner and on such basis as
they, in their sole discretion, deem fair and equitable. Each such allocation by
the Trustees shall be conclusive and binding upon the Holders of all Interests
for all purposes.
(b) The Trust Property belonging to each particular Series shall be charged
with the liabilities of the Trust in respect of that Series and all expenses,
costs, charges and reserves attributable to that Series, except that
liabilities, expenses, costs, charges and reserves allocated solely to a
particular Class, if any, shall be borne by that Class. Any general liabilities,
expenses, costs, charges or reserves of the Trust which are not readily
identifiable as belonging to any particular Series or Class shall be allocated
and charged by the Trustees to and among any one or more of the Series or
Classes established and designated from time to time in such manner and
14
on such basis as the Trustees in their sole discretion deem fair and equitable.
Each allocation of liabilities, expenses, costs, charges and reserves by the
Trustees shall be conclusive and binding upon the Holders of all Interests for
all purposes. The Trustees shall have full discretion, to the extent not
inconsistent with the 1940 Act, to determine which items shall be treated as
income and which items as capital, and each such determination and allocation
shall be conclusive and binding upon the Holders. 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 DBTA, and upon the giving of such notice in the
certificate of trust, the statutory provisions of Section 3805 of the DBTA
relating to limitations on inter-series liabilities (and the statutory effect
under Section 3805 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.
(c) Dividends and distributions on Interests of a particular Series or
Class may be paid with such frequency as the Trustees may determine, which may
be daily or otherwise, pursuant to a standing resolution or resolution adopted
only once or with such frequency as the Trustees may determine, to the Holders
of Interests in that Series or Class, from such of the income and capital gains,
accrued or realized, from the Trust Property belonging to that Series or Class
as the Trustees may determine, after providing for actual and accrued
liabilities belonging to that Series or Class. All dividends and distributions
on Interests in a particular Series or Class shall be distributed pro rata to
the Holders of Interests in that Series or Class in proportion to the total
outstanding Interests in that Series or Class held by such Holders at the date
and time of record establishment for the payment of such dividends or
distribution.
(d) The Interests in a Series or Class of the Trust shall represent
beneficial interests in the Trust Property belonging to such Series or Class.
Each Holder of Interests in a Series or Class shall be entitled to receive its
pro rata share of distributions of income and capital gains made with respect to
such Series or Class. Upon reduction or withdrawal of its Interests or
indemnification for liabilities incurred by reason of being or having been a
Holder of Interests in a Series or Class, such Holder shall be paid solely out
of the funds and property of such Series or Class of the Trust. Upon liquidation
or termination of a Series or Class of the Trust, Holders of Interests in such
Series or Class shall be entitled to receive a pro rata share of the Trust
Property belonging to such Series or Class. A Holder of Interests in a
particular Series or Class of the Trust shall not be entitled to participate in
a derivative or class action lawsuit on behalf of any other Series or Class or
the Holders of Interests in any other Series or Class of the Trust.
(e) Notwithstanding any other provision hereof, if the Trust Property has
been divided into two or more Series or Classes, then on any matter submitted to
a vote of Holders of Interests in the Trust, all Interests then entitled to vote
shall be voted by individual Series or Classes, except that (1) when required by
the 1940 Act, Interests shall be voted in the aggregate and not by individual
Series or Classes, and (2) when the Trustees have determined that the matter
affects only the interests of Holders of Interests in a limited number of Series
or Classes, then only the Holders of Interests in such Series or Class shall be
entitled to vote thereon. Except as
15
otherwise provided in this Article VIII, the Trustees shall have the power to
determine the designations, preferences, privileges, limitations and rights,
including voting and dividend rights, of each Series or Class of Interests.
(f) The establishment and designation of any Series or Class of Interests
other than those set forth above shall be effective upon the Series Class
adoption of a resolution by the Trustees setting forth such establishment and
relative rights and preferences of the Interests of each such Series or Class.
(g) If the Trust Property has been divided into two or more Series, then
Section 9.2 of this Agreement shall apply also with respect to each such Series
as if such Series were a separate trust.
(h) The Trustees shall be authorized to issue an unlimited number of
Interests of each Series.
(i) Subject to compliance with the requirements of the 1940 Act, the
Trustees shall have the authority to provide that Holders of Interests of any
Series or Class shall have the right to convert said Interests into one or more
other Series or Class in accordance with such requirements and procedures as may
be established by the Trustees.
SECTION VIII.9 HOLDER ACTION BY WRITTEN CONSENT. Any action which may be
taken by Holders may be taken without notice and without a meeting if Holders
holding more than 50% of the total Interests entitled to vote (or such larger
proportion thereof as shall be required by any express provision of this
Declaration) shall consent to the action in writing and the written consents
shall be filed with the records of the meetings of Holders. Such consents shall
be treated for all purposes as votes taken at a meeting of Holders.
SECTION VIII.10 HOLDER COMMUNICATIONS. Whenever ten or more Holders who
have been such for at least six months preceding the date of application, and
who hold in the aggregate at least 1% of the total Interests, shall apply to the
Trustees in writing, stating that they wish to communicate with other Holders
with a view to obtaining signatures to a request for a meeting of Holders and
accompanied by a form of communication and request which they wish to transmit,
the Trustees shall within five business days after receipt of such application
either (1) afford to such applicants access to a list of the names and addresses
of all Holders as recorded on the books of the Trust; or (2) inform such
applicants as to the approximate number of Holders, and the approximate cost of
transmitting to them the proposed communication and form of request.
If the Trustees elect to follow the course specified in clause (2) above,
the Trustees, upon the written request of such applicants, accompanied by a
tender of the material to be transmitted and of the reasonable expenses of
transmission, shall, with reasonable promptness, transmit, by United States mail
or by electronic transmission, such material to all Holders at their addresses
as recorded on the books, unless within five business days after such tender the
Trustees shall transmit, by United States mail or by electronic transmission, to
such applicants and file with the Commission, together with a copy of the
material to be transmitted, a written statement signed by at least a majority of
the Trustees to the effect that in their opinion either such material contains
untrue statements of fact or omits to state facts necessary to make the
statements contained therein not misleading, or would be in violation of
applicable law, and specifying the
16
basis of such opinion. The Trustees shall thereafter comply with any order
entered by the Commission and the requirements of the 1940 Act and the
Securities Exchange Act of 1934.
ARTICLE IX. DURATION; TERMINATION OF TRUST; AMENDMENT; MERGERS; ETC.
SECTION IX.1 DURATION. Subject to possible termination in accordance with
the provisions of Section 9.2, the Trust created hereby shall continue
perpetually pursuant to Section 3808 of DBTA.
SECTION IX.2 TERMINATION OF TRUST.
(a) The Trust may be terminated (i) by the affirmative vote of the Holders
of not less than two-thirds of the Interests in the Trust at any meeting of the
Holders, or (ii) by an instrument in writing, without a meeting, signed by a
majority of the Trustees and consented to by the Holders of not less than
two-thirds of such Interests, or (iii) by the Trustees by written notice to the
Holders.
Upon any such termination:
(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, 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 of 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, or other disposition of all or substantially all of the Trust Property
shall require approval of the principal terms of the transaction and the nature
and amount of the consideration by the Holders by a Majority Interests Vote.
(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 Holders according to their respective rights.
(b) Upon termination of the Trust and distribution to the Holders 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 file a certificate of cancellation in accordance with Section 3810 of the
DBTA. Upon termination of the Trust, the Trustees shall thereon be discharged
from all further liabilities and duties hereunder, and the rights and interests
of all Holders shall thereupon cease.
SECTION IX.3 AMENDMENT PROCEDURE.
(a) All rights granted to the Holders under this Declaration of Trust are
granted subject to the reservation of the right of the Trustees to amend this
Declaration of Trust as herein
17
provided, except as set forth herein to the contrary. Subject to the foregoing,
the provisions of this Declaration of Trust (whether or not related to the
rights of Holders) may be amended at any time, so long as such amendment is not
in contravention of applicable law, including the 1940 Act, by an instrument in
writing signed by a majority of the then Trustees (or by an officer of the Trust
pursuant to the vote of a majority of such Trustees). Any such amendment shall
be effective as provided in the instrument containing the terms of such
amendment or, if there is no provision therein with respect to effectiveness,
upon the execution of such instrument and of a certificate (which may be a part
of such instrument) executed by a Trustee or officer of the Trust to the effect
that such amendment has been duly adopted.
(b) No amendment may be made, under Section 9.3 (a) above, which would
change any rights with respect to any Interest in the Trust by reducing the
amount payable thereon upon liquidation of the Trust, by repealing the
limitations on personal liability of any Holder or Trustee, or by diminishing or
eliminating any voting rights pertaining thereto, except with a Majority
Interests Vote.
(c) A certification signed by a majority of the Trustees setting forth an
amendment and reciting that it was duly adopted by the Holders or by the
Trustees as aforesaid or a copy of the Declaration, as amended, and executed by
a majority of the Trustees, shall be conclusive evidence of such amendment when
lodged among the records of the Trust.
(d) Notwithstanding any other provision hereof, until such time as
Interests are first sold, 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.
SECTION IX.4 MERGER, CONSOLIDATION AND SALE OF ASSETS. The Trust, or any
Series or Class thereof, may merge or consolidate with any other corporation,
association, trust or other organization or may sell, lease or exchange all or
substantially all of its property, including its good will, upon such terms and
conditions and for such consideration when and as authorized by no less than a
majority of the Trustees and by a Majority Interests Vote of the Trust or such
Series or Class, as the case may be, or by an instrument or instruments in
writing without a meeting, consented to by the Holders of not less than 50% of
the total Interests of the Trust or such Series or Class, as the case may be,
and any such merger, consolidation, sale, lease or exchange shall be deemed for
all purposes to have been accomplished under and pursuant to the statutes of the
State of Delaware. In accordance with Section 3815(f) of DBTA, an agreement of
merger or consolidation may effect any amendment to the Declaration or By-Laws
or effect the adoption of a new declaration of trust or by-laws of the trust if
the Trust is the surviving or resulting business trust. A certificate of merger
or consolidation of the Trust shall be signed by a majority of the Trustees.
SECTION IX.5 INCORPORATION. Upon a Majority Interests Vote, 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, 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,
association or organization in exchange for the equity interests thereof or
otherwise, and to lend money to, subscribe for the equity interests of, and
enter into any contracts with any such corporation, trust, partnership,
association or organization, or any corporation, partnership, trust, association
or organization in which the Trust holds or is about to acquire equity
interests. The Trustees may also cause a merger or consolidation between the
Trust or any successor thereto
18
and any such corporation, trust, partnership, 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 the Holders
for the Trustees to organize or assist in organizing one or more corporations,
trusts, partnerships, associations or other organizations and selling, conveying
or transferring a portion of the Trust Property to such organizations or
entities.
ARTICLE X. MISCELLANEOUS
SECTION X.1 CERTIFICATE OF DESIGNATION; AGENT FOR SERVICE OF PROCESS. The
Trust shall file, in accordance with Section 3812 of DBTA, in the office of the
Secretary of State of Delaware, a certificate of trust, in the form and with
such information required by Section 3810 by DBTA and executed in the manner
specified in Section 3811 of DBTA. In the event the Trust does not have at least
one Trustee qualified under Section 3807(a) of DBTA, then the Trust shall comply
with Section 3807(b) of DBTA by having and maintaining a registered office in
Delaware and by designating a registered agent for service of process on the
Trust, which agent shall have the same business office as the Trust's registered
office. The failure to file any such certificate, to maintain a registered
office, to designate a registered agent for service of process, or to include
such other information shall not affect the validity of the establishment of the
Trust, the Declaration, the By-Laws or any action taken by the Trustees, the
Trust officers or any other Person with respect to the Trust except insofar as a
provision of the DBTA would have governed, in which case the Delaware common law
governs.
SECTION X.2 GOVERNING LAW. This Declaration is executed by all of the
Trustees and delivered with reference to DBTA and the laws of the State of
Delaware, and the rights of all parties and the validity and construction of
every provision hereof shall be subject to and construed according to DBTA and
the laws of the State of Delaware (unless and to the extent otherwise provided
for and/or preempted by the 1940 Act or other applicable federal securities
laws); provided, however, that there shall not be applicable to the Trust, the
Trustees or this Declaration (a) the provisions of Section 3540 of Title 12 of
the Delaware Code or (b) any provisions of the laws (statutory or common) of the
State of Delaware (other than the DBTA) pertaining to trusts which are
inconsistent with the rights, duties, powers, limitations or liabilities of the
Trustees set forth or referenced in this Declaration.
SECTION X.3 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.
SECTION X.4 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 Holders, (b) the due
authorization of the execution of any instrument or writing, (c) the form of any
vote passed at a meeting of Trustees or Holders, (d) the fact that the number of
Trustees or Holders present at any meeting or executing any written instrument
satisfies the requirements of this Declaration, (e) the form of any By-Laws
adapted by or the identity of any officers elected by the Trustees, or (f) 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.
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SECTION X.5 PROVISIONS IN CONFLICT WITH LAW OR REGULATIONS.
(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 DBTA, or with other applicable laws and
regulations, the conflicting provisions 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.
SECTION X.6 TRUST ONLY. It is the intention of the Trustees to create only
a statutory trust under DBTA with the relationship of Trustee and beneficiary
between the Trustees and each Holder from time to time. It is not the intention
of the Trustees to create a general partnership, limited partnership, joint
stock association, corporation, bailment, or any form of legal relationship
other than a Delaware statutory trust except to the extent such trust is deemed
to constitute a corporation under the Code and applicable state tax laws.
Nothing in this Declaration of Trust shall be construed to make the Holders,
either by themselves or with the Trustees, partners or members of a joint stock
association.
SECTION X.7 WITHHOLDING. Should any Holder be subject to withholding
pursuant to the Code or any other provision of law, the Trust shall withhold all
amounts otherwise distributable to such Holder as shall be required by law and
any amounts so withheld shall be deemed to have been distributed to such Holder
under this Declaration of Trust. If any sums are withheld pursuant to this
provision, the Trust shall remit the sums so withheld to and file the required
forms with the Internal Revenue Service, or other applicable government agency.
SECTION X.8 HEADINGS AND CONSTRUCTION. Headings are placed herein for
convenience of reference only and shall not be taken as a part hereof or control
or affect the meaning, construction or effect of this instrument. Whenever the
singular number is used herein, the same shall include the plural; and the
neuter, masculine and feminine genders shall include each other, as applicable.
IN WITNESS WHEREOF the undersigned Trustee named below do hereby make and
enter into this has caused this Agreement and Declaration of Trust as of the
date first written above.
/s/Xxxxx Xxxxxx
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Xxxxx Xxxxxx, Trustee
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