BARON SELECT FUNDS TRUST
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AGREEMENT
AND DECLARATION OF TRUST
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April [ ], 2003
TABLE OF CONTENTS
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ARTICLE I
The Trust
Section 1.1 Name...........................................................2
Section 1.2 Definitions....................................................2
Section 1.3 Purpose and Powers of Trust....................................4
ARTICLE II
Trustees
Section 2.1 Number and Qualification.......................................4
Section 2.2 Term and Election..............................................4
Section 2.3 Resignation and Removal........................................5
Section 2.4 Vacancies......................................................5
Section 2.5 Meetings.......................................................6
Section 2.6 Officers.......................................................7
ARTICLE III
Powers and Duties of Trustees
Section 3.1 General........................................................7
Section 3.2 Investments....................................................8
Section 3.3 Legal Title....................................................8
Section 3.4 Issuance and Repurchase of Shares..............................8
Section 3.5 Borrow Money or Utilize Leverage...............................9
Section 3.6 Delegation; Committees.........................................9
Section 3.7 Collection and Payment.........................................9
Section 3.8 Expenses......................................................10
Section 3.9 By-Laws.......................................................10
Section 3.10 Miscellaneous Powers........ .................................10
Section 3.11 Further Powers................................................11
ARTICLE IV
Limitations of Liability and Indemnification
Section 4.1 No Personal Liability of Shareholders, Trustees, etc..........11
Section 4.2 Mandatory Indemnification.....................................12
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Section 4.3 No Duty of Investigation; Notice in Trust Instruments, etc....14
Section 4.4 Reliance on Experts, etc......................................14
ARTICLE V
Shares of Beneficial Interest
Section 5.1 Beneficial Interest...........................................14
Section 5.2 Series Designation............................................15
Section 5.3 Class Designation.............................................15
Section 5.4 Description of Shares.........................................16
Section 5.5 Rights of Shareholders........................................17
Section 5.6 Trust Only....................................................18
Section 5.7 Issuance of Shares............................................18
Section 5.8 Register of Shares............................................18
Section 5.9 Transfer of Shares............................................19
Section 5.10 Notices.......................................................19
Section 5.11 Net Asset Value...............................................20
Section 5.12 Distributions to Shareholders.................................20
ARTICLE VI
Shareholders
Section 6.1 Meetings of Shareholders......................................20
Section 6.2 Voting........................................................21
Section 6.3 Notice of Meeting, Shareholder Proposals and Record Date......21
Section 6.4 Quorum and Required Vote......................................22
Section 6.5 Proxies, etc..................................................22
Section 6.6 Reports.......................................................23
Section 6.7 Inspection of Records.........................................23
Section 6.8 Shareholder Action by Written Consent.........................23
ARTICLE VII
Redemption
Section 7.1 Redemptions...................................................24
Section 7.2 Disclosure of Holding.........................................24
Section 7.3 Redemptions of Small Accounts.................................24
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ARTICLE VIII
Duration: Termination of Trust; Amendment; Mergers, Etc.
Section 8.1 Duration......................................................25
Section 8.2 Termination...................................................25
Section 8.3 Amendment Procedure...........................................26
Section 8.4 Merger, Consolidation and Sale of Assets......................27
ARTICLE IX
Miscellaneous
Section 9.1 Filing........................................................28
Section 9.2 Resident Agent................................................28
Section 9.3 Governing Law.................................................28
Section 9.4 Counterparts..................................................28
Section 9.5 Use of the Name "Baron".......................................29
Section 9.6 Reliance by Third Parties.....................................29
Section 9.7 Provisions in Conflict with Law or Regulation.................29
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BARON SELECT FUNDS TRUST
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AGREEMENT
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AND
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DECLARATION OF TRUST
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AGREEMENT AND DECLARATION OF TRUST made as of the [ ] th day of April,
2003, by the Trustees hereunder, and by the holders of shares of beneficial
interest issued hereunder as hereinafter provided.
WHEREAS, this Trust has been formed to carry on business as set forth more
particularly hereinafter;
WHEREAS, this Trust is authorized to issue an unlimited number of its
shares of beneficial interest in separate series and classes of each such
series, each separate series to be a sub-trust hereunder, all in accordance with
the provisions hereinafter set forth;
WHEREAS, the Trustees have agreed to manage all property coming into their
hands as Trustees of a Delaware statutory trust in accordance with the
provisions hereinafter set forth; and
WHEREAS, the parties hereto intend that the Trust created by this
Declaration and the Certificate of Trust filed with the Secretary of State of
the State of Delaware on December [ ], 2002 shall constitute a statutory trust
under the Delaware Statutory Trust Statute and that this Declaration shall
constitute the governing instrument of such statutory trust.
NOW, THEREFORE, the Trustees hereby declare that they will hold all cash,
securities, and other assets which they may from time to time acquire in any
manner as Trustees hereunder IN TRUST to manage and dispose of the same upon the
following terms and conditions for the benefit of the holders from time to time
of shares of beneficial interest in this Trust or sub-trusts created hereunder
as hereinaf ter set forth.
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ARTICLE I
The Trust
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Section 1.1 Name. This Trust shall be known as "Baron Select Funds Trust"
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or any other name or names as the Trustees may from time to time determine;
provided, however, that if BAMCO or an affiliate or successor thereof ceases to
be the investment adviser to the Trust, the Trustees shall promptly modify the
name of the Trust to exclude the word "Baron" and any variant thereof.
Section 1.2 Definitions. As used in this Declaration, the following terms
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shall have the following meanings:
"By-Laws" shall mean the By-Laws of the Trust as amended from time to time
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by the Trustees.
"Class" shall mean a portion of Shares of a Series of the Trust established
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in accordance with Section 5.3 hereof.
"Code" shall mean the Internal Revenue Code of 1986, as amended, and the
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regulations promulgated thereunder.
"Commission" shall mean the Securities and Exchange Commission.
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"Declaration" shall mean this Agreement and Declaration of Trust, as
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amended or amended and restated from time to time, including by way of any
classifying or reclassifying Shares of any Series or any Class of any such
Series or determining any designations, powers, preferences, voting, conversion
and other rights, limitations, qualifications and terms and conditions thereof.
"Delaware Statutory Trust Statute" shall mean the provisions of the
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Delaware Statutory Trust Act, 12 Del. C. Sec. 3801, et. seq., as such Act may be
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amended from time to time.
"Fundamental Policies" shall mean the investment policies and restrictions
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set forth from time to time in any Prospectus or contained in any current
Registration Statement of the Trust or any Series filed with the Commission or
as otherwise adopted by the Trustees and the Shareholders in accordance with the
requirements of the 1940 Act that are expressly designated as fundamental
policies of
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such Series as they may be amended from time to time in accordance with the 1940
Act.
"Interested Person" shall have the meaning ascribed thereto in the 1940
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Act.
"Majority Shareholder Vote" shall mean a vote of a "majority of the
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outstanding voting securities" (as such term is defined in the 0000 Xxx) of the
Trust, any Series of the Trust or any Class thereof, as applicable.
The "1940 Act" refers to the Investment Company Act of 1940 and the rules
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and regulations promulgated thereunder and applicable exemptions there from, as
amended from time to time.
The "1933 Act" refers to the Securities Act of 1933, and the rules and
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regulations promulgated thereunder and applicable exemptions therefrom, as
amended from time to time.
"Person" shall mean and include natural persons, corporations,
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partnerships, trusts, limited liability companies, associations, joint ventures
and other entities, whether or not legal entities, and governments and agencies
and political subdivisions thereof.
"Prospectus" shall mean the current prospectus or offering memoran dum of
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securities of the Trust or of any Series thereof or of any Class of any such
Series, as applicable.
"Series" shall mean the separate sub-trusts that may be established and
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designated as series pursuant to Section 5.2 hereof or any one of such
sub-trusts, as applicable.
"Series Liabilities" shall mean as of any particular time any and all
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debts, obligations or other liabilities, contingent or otherwise, of or relating
to a particular Series of the Trust.
"Series Property" shall mean as of any particular time any and all
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property, real or personal, tangible or intangible, which at such time is owned
or held by or for the account of a particular Series.
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"Shareholders" shall mean as of any particular time the holders of record
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of outstanding Shares of the Trust, any Series of the Trust or any Class of any
Series, as applicable, at such time.
"Shares" shall mean the transferable units of beneficial interest in the
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Trust or in a Series of the Trust and includes fractions of Shares as well as
whole Shares, which Shares may be classified as relating to particular Series
and Classes within a Series. All references to Shares shall be deemed to be
Shares of any or all Series or Classes as the context may require.
"Trust" shall mean the trust established by this Declaration, as amended
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from time to time, inclusive of each such amendment and every sub-trust
established as a Series hereunder.
"Trustees" shall mean the signatory to this Declaration, so long as such
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signatory shall continue in office in accordance with the terms hereof, and all
other Persons who at the time in question have been duly elected or appointed
and have qualified as trustees in accordance with the provisions hereof and are
then in office.
Section 1.3 Purpose and Powers of Trust. The Trust is established for the
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purpose of engaging in any activity not prohibited by Delaware law and shall
have the power to engage in any such activity and in any activity incidental or
related to any such activity.
ARTICLE II
Trustees
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Section 2.1 Number and Qualification. Prior to any offering of Shares,
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there may be a sole Trustee and thereafter the number of Trustees shall be such
number, not less than three or more than fifteen, as shall be set forth in a
written instrument or resolution signed or adopted by a majority of the Trustees
then in office. No reduction in the number of Trustees shall have the effect of
removing any Trustee from office prior to the expiration of his or her term. An
individual nomi nated as a Trustee shall be at least 21 years of age and not
older than such age as may be set forth in a written instrument or resolution
signed or adopted by not less than a majority of the Trustees then in office and
shall not be under legal disability. Trustees need not own Shares and may
succeed themselves in office.
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Section 2.2 Term and Election. Except for the Trustees appointed to fill
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vacancies pursuant to Section 2.4 hereof, each Trustee shall be elected to serve
until death, resignation, removal or reelection at the annual meeting, if one is
held, or at any special meeting of shareholders. Subject to the foregoing
sentence, each Trustee named herein or elected or appointed pursuant to the
terms hereof shall hold office until such Trustee's successor has been elected
at such a meeting and has qualified to serve as Trustee. Election of Trustees at
a meeting shall be by the affirmative vote of the holders of a plurality of the
Shares present in person or by proxy. Each individual elected or appointed as a
Trustee of the Trust shall, unless otherwise provided by such election or
appointment, also thereby be elected or appointed, as the case may be, as a
Trustee of each Series of the Trust in existence at any time such individual is
a Trustee. The Trustees may elect one of themselves to serve as Chairman.
Section 2.3 Resignation and Removal. Any Trustee may resign his trust
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(without need for prior or subsequent accounting) by an instrument in writing
signed by him and delivered or mailed to the Trustees or the Chairman, if any,
the President or the Secretary and such resignation shall be effective upon such
delivery, or at a later date according to the terms of the instrument. Any
Trustee may be removed (provided the aggregate number of Trustees after such
removal shall not be less than the minimum number required by Section 2.1
hereof) for cause at any time by written instrument, signed by two-thirds of the
remaining Trustees, specifying the date when such removal shall become
effective. Any Trustee may be removed (provided the aggregate number of Trustees
after such removal shall not be less than the minimum number required by Section
2.1 hereof) without cause at any time by a written instrument, signed or adopted
by two-thirds of the remaining Trustees or by vote of Shares having not less
than two-thirds of the aggregate number of Shares entitled to vote in the
election of such Trustee, specifying the date when such removal shall become
effective. Upon the resignation or removal of a Trustee, or such Person
otherwise ceasing to be a Trustee, such Person shall cease to hold any Series
Property previously held in the name of such former Trustee, without any
requirement that such former Trustee execute and deliver any conveyance or ac
knowledgment thereof.
Section 2.4 Vacancies. Whenever a vacancy in the Board of Trustees shall
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occur, the remaining Trustees may fill such vacancy by appointing an individual
having the qualifications described in this Article by a written instrument
signed by a majority of the Trustees then in office or by election by the
Shareholders, or may leave such vacancy unfilled or may reduce the number of
Trustees (provided the aggregate number of Trustees after such reduction shall
not be less than the
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minimum number required by Section 2.1 hereof). Any vacancy created by an
increase in Trustees may be filled by the appointment of an individual having
the qualifications described in this Article made by a written instrument or
resolution signed or approved by a majority of the Trustees then in office or by
election by the Shareholders. No vacancy shall operate to annul this Declaration
or to revoke any existing authority or power existing pursuant to the terms of
this Declaration. Whenever a vacancy in the number of Trustees shall occur,
until such vacancy is filled as provided herein, the Trustees in office,
regardless of their number, shall have all the powers granted to the Trustees
and shall discharge all the duties imposed upon the Trustees by this
Declaration.
Section 2.5 Meetings. Meetings of the Trustees shall be held from time to
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time upon the call of the Chairman, if any, the President, the Secretary or any
two Trustees. Regular meetings of the Trustees may be held without call or
notice at a time and place fixed by the By-Laws or by resolution of the
Trustees. Notice of any other meeting shall be given by the Secretary and shall
be mailed not less than 48 hours to the Trustees before the meeting or otherwise
actually delivered orally or in writing 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 properly called or convened. A quorum for all meetings of
the Trustees shall be one-third, but not less than two, of the Trustees then in
office. Unless provided otherwise in this Declaration of Trust and except as
required by the 1940 Act, any action of the Trustees may be taken at a meeting
by vote of a majority of the Trustees present (a quorum being present) or
without a meeting by written consent of a majority of the Trustees then in
office.
Any committee of the Trustees, including an executive committee, if any,
may act with or without a meeting. A quorum for all meetings of any such
committee shall be one third, but not less than two, of the members thereof.
Unless provided otherwise in this Declaration or any instrument or resolution of
the Trustees establishing or affecting such Committee, 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.
With respect to actions of the Trustees and any committee of the Trustees,
Trustees who are Interested Persons in any action to be taken may be counted for
quorum purposes under this Section and shall be entitled to vote to the extent
not prohibited by the 1940 Act.
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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, internet
connection or similar communications equipment by means of which all Persons
participating in the meeting can hear or otherwise communicate with each other;
participation in a meeting pursuant to any such communications system shall
constitute presence in person at such meeting except as otherwise provided by
the 1940 Act.
Section 2.6 Officers. The Trustees shall elect a President, a Secre tary, a
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Treasurer and an Assistant Treasurer, who shall serve at the pleasure of the
Trustees or until their successors are elected. The Trustees may elect or
appoint or may authorize the Chairman, if any, or President to appoint such
other officers or agents with such other titles and powers as the Trustees may
deem to be advisable. The President, Secretary, Treasurer and Assistant
Treasurer may, but need not, be a Trustee.
ARTICLE III
Powers and Duties of Trustees
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Section 3.1 General. The Trustees shall owe to the Trust and its
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Shareholders the same fiduciary duties as owed by directors of corporations to
such corporations and their stockholders under the general corporation law of
the State of Delaware. The Trustees shall have exclusive and absolute control
over the Series Property of each Series and over the business of the Trust and
any Series thereof to the same extent as if the Trustees were the sole owners of
all such Series Property and business in their own right, but with such powers
of delegation as may be permitted by this Declaration. The enumeration of any
specific power herein shall not be construed as limiting the aforesaid power.
The Trustees may perform such acts as in their sole discretion are proper for
conducting the business of the Trust. The powers of the Trustees may be
exercised without order of or resort to any court. No Trustee shall be obligated
to give any bond or other security for the performance of any of his duties or
powers hereunder.
Section 3.2 Investments. The Trustees shall have power, subject to the
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Fundamental Policies in effect from time to time, to:
(a) manage, conduct, operate and carry on the business of an
investment company;
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(b) subscribe for, invest in, reinvest in, purchase or otherwise
acquire, hold, pledge, sell, assign, transfer, exchange, distribute or otherwise
deal in or dispose of any and all sorts of property, tangible or intangible,
including but not limited to securities of any type whatsoever, whether equity
or non-equity, of any issuer, evidences of indebtedness of any Person and any
other rights, interests, instruments or property of any sort and to exercise any
and all rights, powers and privileges of ownership or interest in respect of any
and all such investments of every kind and description, including, without
limitation, the right to consent and otherwise act with respect thereto, with
power to designate one or more Persons to exercise any of said rights, powers
and privileges in respect of any of said investments. The Trustees shall not be
limited by any law limiting the investments which may be made by fiduciaries.
Section 3.3 Legal Title. Legal title to all the Series Property shall be
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vested in the Trustees as joint tenants except that the Trustees shall have
power to cause legal title to any Series Property to be held by or in the name
of one or more of the Trustees, or in the name of the Trust, or any Series
thereof, or in the name of any other Person as nominee, custodian or pledgee, on
such terms as the Trustees may determine, provided that the interest of the
Trust or any Series thereof therein is appropriately protected.
The right, title and interest of the Trustees in the Series Property shall
vest automatically in each Person who may hereafter become a Trustee upon his
due election and qualification. Upon the ceasing of any Person to be a Trustee
for any reason, such Person shall automatically cease to have any right, title
or interest in any of the Series Property, and the right, title and interest of
such Trustee in the Series Property shall vest automatically in the remaining
Trustees. Such vesting and cessation of title shall be effective whether or not
conveyancing documents have been executed and delivered.
Section 3.4 Issuance and Repurchase of Shares. The Trustees shall have the
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power to issue, sell, repurchase, redeem, retire, cancel, acquire, hold, resell,
reissue, dispose of, transfer, and otherwise deal in, Shares, including Shares
in fractional denominations, shall have the power to establish from time to time
in accordance with the provisions of Section 5.2 and 5.3 hereof Series and
Classes representing interests in the Trust or a Series thereof and, subject to
the more detailed provisions set forth in Article VII, shall have the power to
apply to any such repur chase, redemption, retirement, cancellation or
acquisition of Shares any funds or property of the applicable Series of the
Trust whether capital or surplus or otherwise,
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to the full extent now or hereafter permitted by the laws of the State of
Delaware governing business corporations.
Section 3.5 Borrow Money or Utilize Leverage. Subject to the Fundamental
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Policies in effect from time to time, the Trustees shall have the power to
borrow money or otherwise obtain credit or utilize leverage in connection with
the activities of any Series to the maximum extent permitted by law, regulation
or order and the Fundamental Policies of any Series and to secure the same by
mortgaging, pledging or otherwise subjecting as security the assets of such
Series, including the lending of portfolio securities, and to endorse,
guarantee, or undertake the perfor xxxxx of any obligation, contract or
engagement of any other Person; provided, however, that the assets of any
particular Series shall not be used as security for any credit extended solely
or partially to one or more other Series.
Section 3.6 Delegation; Committees. The Trustees shall have the power,
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consistent with their continuing exclusive authority over the management of the
Trust and the Series 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
applicable Series or the names of the Trustees or otherwise as the Trustees may
deem expedient, to at least the same extent as such delegation is permitted to
directors of a Delaware business corporation and is permitted by the 1940 Act,
as well as any further delega tions the Trustees may determine to be desirable,
expedient or necessary in order to effect the purpose hereof. The Trustees may
designate one or more committees which shall have all or such lesser portion of
the authority of the entire Board of Trustees as the Trustees shall determine
from time to time except to the extent action by the entire Board of Trustees or
particular Trustees is required by the 1940 Act.
Section 3.7 Collection and Payment. The Trustees shall have power to
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collect all property due to any Series of the Trust; to pay all claims,
including taxes, against any Series Property, the Trust or any Series of the
Trust, the Trustees or any officer, employee or agent of the Trust; to
prosecute, defend, compromise or abandon any claims relating to any Series
Property, the Trust or any Series of the Trust, the Trustees or any officer,
employee or agent of the Trust; to foreclose any security interest securing any
obligations, by virtue of which any property is owed to any Series of the Trust;
and to enter into releases, agreements and other instruments. Except to the
extent required for a Delaware business corporation, the Shareholders shall have
no power to vote as to whether or not a court action, legal proceeding or claim
should or should not be brought or maintained derivatively or as a class action
on behalf of the Trust, any Series or the Shareholders thereof.
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Section 3.8 Expenses. The Trustees shall have power to incur and pay out of
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the assets or income of any Series of the Trust, any expenses which in the
opinion of the Trustees are necessary or appropriate to carry out any of the
purposes of this Declaration, and the business of any Series of the Trust, and
to pay reasonable compensation from the funds of each Series to themselves as
Trustees. The Trustees shall fix the compensation of all officers, employees and
Trustees. Subject to the 1940 Act, the Trustees may pay themselves such
compensation for special services, including legal, underwriting, syndicating
and brokerage services, as they in good faith may deem reasonable and
reimbursement for expenses reasonably incurred by themselves on behalf of any
Series. The Trustees shall have the power, as frequently as they may determine,
to cause each Shareholder, or each Shareholder of any particular Series, to pay
directly, in advance or arrears, for charges of distribution, of the custodian
or transfer, shareholder servicing or similar agent of such Series or Class, a
pro rata amount as defined from time to time by the Trustees, by setting off
such charges due from such Shareholder from declared but unpaid dividends or
distributions owed such Shareholder and/or by reducing the number of shares in
the account of such Shareholder by that number of full and/or fractional Shares
which represents, at the net asset value thereof, the outstanding amount of such
charges due from such Shareholder.
Section 3.9 By-Laws. The Trustees shall have the exclusive author ity to
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adopt and from time to time amend or repeal By-Laws for the conduct of the
business of the Trust.
Section 3.10 Miscellaneous Powers. The Trustees shall have the power to:
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(a) employ or contract with such Persons as the Trustees may deem desirable for
the transaction of the business of any Series, including investment advisors,
administrators, custodians, transfer agents, shareholder services providers,
accountants, counsel, brokers, dealers and others; (b) enter into joint
ventures, partnerships and any other combinations or associations; (c) purchase,
and pay for out of Series Property, insurance policies insuring the
Shareholders, Trustees, officers, employees, agents, investment advisors,
distributors, selected dealers or independent contractors of any Series against
all claims arising by reason of holding any such position or by reason of any
action taken or omitted by any such Person in such capacity, whether or not
constituting negligence, or whether or not the Trust would have the power to
indemnify such Person against such liability; (d) establish pension,
profit-sharing, share purchase, and other retirement, incentive and benefit
plans for any Trustees, officers, employees and agents of the Trust; (e) make
xxxx tions, irrespective of benefit to the Trust, for charitable, religious,
educational, scientific, civic or similar purposes; (f) to the extent permitted
by applicable law,
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indemnify any Person with whom any Series has dealings, including without limita
tion any investment advisor, administrator, manager, transfer agent, custodian,
distributor or selected dealer, or any other Person as the Trustees may see fit
to such extent as the Trustees shall determine; (g) guarantee indebtedness or
contractual obligations of others; (h) determine and change the fiscal year of
the Trust and the method in which its accounts shall be kept; and (i) adopt a
seal for the Trust but the absence of such seal shall not impair the validity of
any instrument executed on behalf of the Trust.
Section 3.11 Further Powers. The Trustees shall have the power to conduct
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the business of the Trust or any Series of the Trust or any Class thereof and
carry on its operations in any and all of its branches and maintain offices both
within and without the State of Delaware, in any and all states of the United
States of America, in the District of Columbia, and in any and all
commonwealths, territories, dependencies, colonies, possessions, agencies or
instrumentalities of the United States of America and of foreign governments,
and to do all such other things and execute all such instruments as they deem
necessary, proper or desirable in order to promote the interests of the Trust or
any Series of the Trust or any Class thereof although such things are not herein
specifically mentioned. Any determination as to what is in the interests of the
Trust or any Series of the Trust or any Class thereof made by the Trustees in
good faith shall be conclusive. In construing the provisions of this
Declaration, the presumption shall be in favor of a grant of power to the
Trustees.
ARTICLE IV
Limitations of Liability and Indemnification
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Section 4.1 No Personal Liability of Shareholders, Trustees, etc. No
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Shareholder of the Trust shall be subject in such capacity to any personal
liability whatsoever to any Person in connection with Series Property or the
acts, obligations or affairs of the Trust. Shareholders shall have the same
limitation of personal liability as is extended to stockholders of a private
corporation for profit incorporated under the general corporation law of the
State of Delaware. No Trustee, officer, employee or agent of the Trust or any
Series of the Trust shall be subject in such capacity to any personal liability
whatsoever to any Person, other than the Trust or the respective Series or the
Shareholders, in connection with Series Property or the affairs of the Trust or
the respective Series, save only liability to the Trust or its Shareholders
arising from bad faith, willful misfeasance, gross negligence or reckless
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disregard for his duty to such Person; and, subject to the foregoing exception,
all such Persons shall look solely to the Series Property of the affected Series
for satisfaction of claims of any nature arising in connection with the affairs
of the Trust. If any Shareholder, Trustee or officer, as such, of the Trust, is
made a party to any suit or proceeding to enforce any such liability, subject to
the foregoing exception regarding Trustees and officers, he shall not, on
account thereof, be held to any personal liability. Any repeal or modification
of this Section 4.1 shall not adversely affect any right or protection of a
Trustee or officer of the Trust existing at the time of such repeal or
modification with respect to acts or omissions occurring prior to such repeal or
modification.
Section 4.2 Mandatory Indemnification. (a) The Trust hereby agrees, solely
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out of the assets of the affected Series, to indemnify each Person who at any
time serves as Trustee or officer of the Trust (each such Person being an
"indemnitee") against any liabilities and expenses, including amounts paid in
satisfaction of judgments, in compromise or as fines and penalties, and
reasonable counsel fees reasonably incurred by such indemnitee in connection
with the defense or disposition of any action, suit or other proceeding, whether
civil or criminal, before any court or administrative or investigative body in
which he may be or may have been involved as a party or otherwise or with which
he may be or may have been threatened, while acting in any capacity set forth
above in this Article IV by reason of his having acted in any such capacity,
except with respect to any matter as to which he shall not have acted in good
faith in the reasonable belief that his action was in the best interest of the
Trust or the respective Series of the Trust and further more, in the case of any
criminal proceeding, as to which he shall have had reason able cause to believe
that the conduct was unlawful, provided, however, that no indemnitee shall be
indemnified hereunder against any liability to any Person or any expense of such
indemnitee arising by reason of (i) willful misfeasance, (ii) bad faith, (iii)
gross negligence, or (iv) reckless disregard of the duties involved in the
conduct of his position. Notwithstanding the foregoing, with respect to any
action, suit or other proceeding voluntarily prosecuted by any indemnitee as
plaintiff, indemnifica tion shall be mandatory only if the prosecution of such
action, suit or other proceed ing by such indemnitee was (1) authorized by a
majority of the Trustees or (2) was instituted by the indemnitee to enforce his
or her rights to indemnification hereunder in a case in which the indemnitee is
found to be entitled to such indemnification. The rights to indemnification set
forth in this Declaration shall continue as to a Person who has ceased to be a
Trustee or officer of the Trust and shall inure to the benefit of his or her
heirs, executors and personal and legal representatives. No amendment or
restatement of this Declaration or repeal of any of its provisions shall limit
or eliminate any of the benefits provided to any Person who at any time is or
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was a Trustee or officer of the Trust or otherwise entitled to indemnification
hereun der in respect of any act or omission that occurred prior to such
amendment, restate ment or repeal.
(b) Notwithstanding the foregoing, no indemnification shall be made
hereunder unless there has been a determination (1) by a final decision on the
merits by a court or other body of competent jurisdiction before whom the issue
of entitlement to indemnification hereunder was brought that such indemnitee is
entitled to indemnification hereunder or, (2) in the absence of such a decision,
by (i) a majority vote of a quorum (being one-third of such Trustees) of those
Trustees who are neither Interested Persons of the Trust nor parties to the
proceeding ("Disinter ested Non-Party Trustees"), that the indemnitee is
entitled to indemnification hereunder, or (ii) if such quorum is not obtainable
or even if obtainable, if such majority so directs, independent legal counsel in
a written opinion conclude that the indemnitee should be entitled to
indemnification hereunder. All determinations to make advance payments in
connection with the expense of defending any proceeding shall be authorized and
made in accordance with the immediately succeeding paragraph (c) below.
(c) The Trust shall make advance payments in connection with the
expenses of defending any action with respect to which indemnification might be
sought hereunder if the Trust receives a written affirmation by the indemnitee
of the indemnitee's good faith belief that the standards of conduct necessary
for indemnification have been met and a written undertaking to reimburse the
Trust unless it is subsequently determined that indemnitee is entitled to such
indemnification and if a majority of the Trustees determine that the applicable
standards of conduct necessary for indemnification appear to have been met. In
addition, at least one of the following conditions must be met: (1) the
indemnitee shall provide adequate security for his undertaking, (2) the Trust
shall be insured against losses arising by reason of any lawful advances, or (3)
a majority of a quorum of the Disinterested Non-Party Trustees, or if a majority
vote of such quorum so directs, independent legal counsel in a written opinion,
shall conclude, based on a review of readily available facts (as opposed to a
full trial-type inquiry), that there is substantial reason to believe that the
indemnitee ultimately will be found entitled to indemnification.
(d) The rights accruing to any indemnitee under these provisions
shall not exclude any other right to which he or she may be lawfully entitled.
13
(e) Subject to any limitations provided by the 1940 Act and this
Declaration, the Trust shall have the power and authority, solely out of the
assets of the affected Series, to indemnify and provide for the advance payment
of expenses to employees, agents and other Persons providing services to the
Trust or serving in any capacity at the request of the Trust to the full extent
as corporations organized under the Delaware General Corporation Law may
indemnify or provide for the advance payment of expenses for such Persons
provided that such indemnification has been approved by a majority of the
Trustees.
Section 4.3 No Duty of Investigation; Notice in Trust Instruments, etc. No
------------------------------------------------------------
purchaser, lender, transfer agent or other Person dealing with the Trustees or
with any officer, employee or agent of the Trust or any Series of the Trust or
Class thereof shall be bound to make any inquiry concerning the validity of any
transaction purporting to be made by the Trustees or by said officer, employee
or agent or be liable for the application of money or property paid, loaned, or
delivered to or on the order of the Trustees or of said officer, employee or
agent. Every obligation, contract, undertaking, instrument, certificate, Share,
other security of the Trust or any Series of the Trust, and every other act or
thing whatsoever executed in connection with the Trust or any Series of the
Trust shall be conclusively taken to have been executed or done by the executors
thereof only in their capacity as Trustees under this Declaration or in their
capacity as officers, employees or agents of the Trust. The Trustees may
maintain insurance for the protection of the Series Property, the Shareholders
of each Series, Trustees, officers, employees and agents in such amount as the
Trustees shall deem adequate to cover possible liability, and such other
insurance as the Trustees in their sole judgment shall deem advisable or is
required by the 1940 Act.
Section 4.4 Reliance on Experts, etc. Each Trustee and officer or employee
--------------------------
of the Trust or any Series of the Trust shall, in the performance of his 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 or any Series of the Trust or Class thereof, upon
an opinion of counsel, or upon reports made to the Trust or any Series thereof
by any of the Trust's officers or employees or by any advisor, administrator,
manager, distributor, selected dealer, accountant, appraiser or other expert or
consultant selected with reasonable care by the Trustees, officers or employees
of the Trust, regardless of whether such counsel or other expert may also be a
Trustee.
14
ARTICLE V
Shares of Beneficial Interest
-----------------------------
Section 5.1 Beneficial Interest. The interest of the beneficiaries
--------------------
hereunder shall be represented by an unlimited number of transferable shares of
beneficial interest, par value $.001 per share. All Shares issued in accordance
with the terms hereof, including, without limitation, Shares issued in
connection with a dividend in Shares or a split of Shares, shall be fully paid
and when the consideration determined by the Trustees (if any) therefor shall
have been received by the Trust. The power to make certain changes against
Shareholders and their Shares shall not be considered assessments for the
foregoing purpose.
Section 5.2 Series Designation. The Trustees, in their discretion from time
------------------
to time, may authorize the reclassification of Shares into one or more Series,
each Series relating to a separate portfolio of investments and each of which
Series shall be a separate and distinct subtrust of the Trust. Each Series so
estab lished hereunder shall be deemed to be a separate trust under the
provisions of Delaware law. The Trustees shall have exclusive power without the
requirement of Shareholder approval to establish and designate such separate and
distinct Series and to fix and determine the relative rights and preferences as
between the different Series. The establishment and designation of any Series
shall be effective upon the execution or approval by a majority of the Trustees
of an instrument or resolution setting forth the establishment and designation
of such Series (or when authorized to do so, by any officer of the Trust
pursuant to the vote of a majority of the Trustees of the Trust). Such
instrument shall also set forth any rights and preferences of such Series which
are in addition to the rights and preferences of Shares set forth in this
Declaration. At any time that there are no Shares outstanding of any particular
Series previously established and designated, the Trustees may by an instrument
or resolu tion executed or approved by a majority of their number abolish or
alter that Series and the establishment and designation thereof. Each instrument
referred to in this paragraph shall have the status of an amendment to this
Declaration.
Section 5.3 Class Designation. The Trustees, in their discretion from time
-----------------
to time, may authorize the reclassification of Shares of any Series into one or
more Classes of Shares all the assets of which Series shall remain commingled
and not allocated among the different Classes thereof. The Trustees shall have
exclusive power without the requirement of Shareholder approval to establish and
designate such separate and distinct Classes and to fix and determine the
relative rights, terms, conditions and expenses applicable to each Class of
Shares to the maximum extent
15
permitted by the 0000 Xxx. The establishment and designation of any Class of
Shares shall be effective upon the execution or approval by a majority of the
Trustees of an instrument or resolution setting forth the establishment and
designation of such Class (or when authorized to do so, by an officer of the
Trust pursuant to the vote of a majority of the Trustees of the Trust. At any
time that there are no Shares outstand ing of any particular Class previously
established and designated, the Trustees may, by an instrument or resolution
executed or approved by a majority of the Trustees, abolish or alter that Class
and the establishment and designation thereof.
Section 5.4 Description of Shares. If the Trustees shall create sub-trusts
---------------------
and reclassify the Shares into one or more Series or create Classes of Shares,
the following provisions shall be applicable:
(a) Number of Shares. The number of Shares of each Series or Class
----------------
that may be issued shall be unlimited. The Trustees may, but shall not be
required to, classify or reclassify any unissued Shares or any Shares previously
issued and reacquired of any Series or Class into one or more Series or Classes
that may be established and designated from time to time. The Trustees may, but
shall not be required to, hold as treasury Shares (of the same or some other
Series or Class), reissue for such consideration and on such terms as they may
determine, or cancel any Shares of any Series or Class reacquired by the Trust
at their discretion from time to time.
(b) Investment of Property. The power of the Trustees to invest
----------------------
and reinvest the Trust Property of each Series that may be established shall be
governed by Section 3.2 of this Declaration.
(c) Allocation of Assets. All consideration received by the Trust
--------------------
for the issue or sale of Shares of a particular Series or Class of such Series,
together with all assets in which such consideration is invested or reinvested,
all income, earnings, profits, and proceeds thereof, including any proceeds
derived from the sale, exchange or liquidation of such assets, and any funds or
payment derived from any reinvestment of such proceeds in whatever form the same
may be, together with such Series' or Class's share of any other assets of the
Trust, shall be held by the Trustees and Trust for the benefit of the
Shareholders of such Series and, subject to the rights of creditors of such
Series only, shall irrevocably belong to that Series for all purposes, and shall
be so recorded upon the books of account of the Trust. In the event that there
are any assets, income, earnings, profits, and proceeds thereof, funds or
payments which are not readily identifiable as belonging to any particular
Series, such assets shall be allocated among the Series in proportion to their
net assets as a
16
proportion of the total net assets of the Trust unless the Trustees shall have
affirma tively allocated them among any one or more of the Series established
and designated from time to time in any other manner or basis as they, in their
sole discretion, deem fair and equitable, and anything so allocated to a Series
shall belong to such Series. Each such allocation shall be conclusive and
binding upon the Shareholders of all Series for all purposes.
(d) Allocation of Liabilities. The assets belonging to each
-------------------------
particular Series or attributable to each particular Class of such Series shall
be charged with the liabilities of the Trust in respect of that Series or Class
and with all expenses, costs, charges and reserves attributable to that Series
or Class, and any general liabilities, expenses, costs, charges or reserves of
the Trust which are not readily identifiable as being attributable to any
particular Series or Class shall be allocated and charged against assets of the
Series and Classes of each Series in proportion to their net assets as a
proportion of the total net assets of the Trust unless the Trustees shall have
affirmatively allocated them and among any one or more of the Series or Classes
established and designated from time to time in any other manner or basis as the
Trustees in their sole discretion deem fair and equitable; provided that any
incremental expenses allocated to one or more Classes of Shares on a basis other
than the relative net asset values of the respective Classes shall be allocated
in a manner consistent with the 1940 Act. Each allocation of liabilities,
expenses, costs, charges and reserves by the Trustees shall be conclusive and
binding upon the Shareholders of all Series and Classes 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 Shareholders. Under no circumstances shall the assets allocated
or belonging to a particular Series or attributable to a particular Class be
charged with any liabilities attributable to another Series or Class. Any
creditor may look only to the assets of the particular Series with respect to
which such Person is a creditor for satisfaction of such creditor's debt.
(e) Dividends. The power of the Trust to pay dividends and make
---------
distributions with respect to any one or more Series shall be governed by
Section 5.12 of this Trust. Dividends and distributions on Shares of a
particular Series may be paid with such frequency as the Trust may determine,
which may be daily or otherwise, pursuant to a standing resolution or
resolutions adopted only once or with such frequency as the Trust may determine,
to the holders of Shares of that Series, from such of the income and capital
gains, accrued or realized, from the assets belonging to that Series, as the
Trust may determine, after providing for actual
17
and accrued liabilities belonging to that Series. All dividends and
distributions on each Class of a Series shall be distributed pro rata to the
holders of Shares of that Class in proportion to the number of Shares of that
Class held by such holders at the date and time of record established for the
payment of such dividends or distribu tions, and such dividends and
distributions need not be pro rata with respect to dividends and distributions
paid to Shares of any other Class of such Series. Divi dends and distributions
shall be paid with respect to Shares of a given Class only out of lawfully
available assets attributable to such Class.
Section 5.5 Rights of Shareholders. The Shares shall be personal property
----------------------
giving only the rights in this Declaration specifically set forth. The owner
ship of the Trust Property of every description and the right to conduct any
business herein before described are vested exclusively in the Trustees, and the
Shareholders shall have no interest therein other than the beneficial interest
conferred by their Shares, with respect to a particular Series or Class and they
shall have no right to call for any partition or division of any property,
profits, rights or interests of the Trust nor can they be called upon to share
or assume any losses of the Trust or, subject to the right of the Trustees to
charge certain expenses directly to Shareholders, as provided in the last
sentence of Section 3.8, suffer an assessment of any kind by virtue of their
ownership of Shares. The Shares shall not entitle the holder to preference,
preemptive, appraisal, conversion or exchange rights (except as specified in
Section 8.4 or as specified by the Trustees in the designation or redesignation
of any Series or Class thereof).
Section 5.6 Trust Only. It is the intention of the Trustees to create only
----------
the relationship of Trustee and beneficiary between the Trustees and each
Shareholder from time to time. It is not the intention of the Trustees to create
a general partnership, limited partnership, joint stock association,
corporation, bail ment or any form of legal relationship other than a trust.
Nothing in this Declaration shall be construed to make the Shareholders, either
by themselves or with the Trustees, partners, members or shareholders of any
such entity.
Section 5.7 Issuance of Shares. The Trustees, in their discretion, may from
------------------
time to time without the vote of the Shareholders issue Shares with respect to
any Series that may have been established pursuant to Section 5.2, in addition
to the then issued and outstanding Shares and Shares held in the treasury, to
such party or parties and for such amount and type of consideration, including
cash or property, at such time or times, and on such terms as the Trustees may
determine, and may in such manner acquire other assets (including the
acquisition of assets subject to, and in connection with the assumption of,
liabilities) and businesses. The Trustees may
18
from time to time divide or combine the Shares of any Series into a greater or
lesser number without thereby changing the proportionate beneficial interest in
such Series of the Trust. Issuances and redemptions of Shares may be made in
whole Shares and/or l/l,000ths of a Share or multiples thereof as the Trustees
may determine.
Section 5.8 Register of Shares. One or more registers shall be kept at the
------------------
offices of the Trust or any transfer agent duly appointed by the Trustees under
the direction of the Trustees which shall contain the names and addresses of the
Shareholders and the number of Shares of each Series and Class thereof held by
them respectively and a record of all transfers thereof. Such registers shall be
conclusive as to who are the holders of the Shares of the applicable Series and
Classes thereof and who shall be entitled to receive dividends or distributions
or otherwise to exercise or enjoy the rights of Shareholders. No Shareholder
shall be entitled to receive payment of any dividend or distribution, nor to
have notice given to him as herein provided, until he or she has given his or
her address to a transfer agent or such other officer or agent of the Trustees
as shall keep the register for entry thereon. It is not contemplated that
certificates will be issued for the Shares; however, the Trustees, in their
discretion, may authorize the issuance of share certificates and promulgate
appropriate fees therefore and rules and regulations as to their use.
Section 5.9 Transfer of Shares. Shares shall be transferable on the records
------------------
of the Trust only by the record holder thereof or by its agent thereto duly
authorized in writing, upon delivery to the Trustees or a transfer agent of the
Trust of a duly executed instrument of transfer, together with such evidence of
the genuine ness of each such execution and authorization and of other matters
as may reasonably be required. Upon such delivery, the transfer shall be
recorded on the applicable register of the Trust. Until such record is made, the
Shareholder of record shall be deemed to be the holder of such Shares for all
purposes hereof and neither the Trustees nor any transfer agent or registrar nor
any officer, employee or agent of the Trust shall be affected by any notice of
the proposed transfer.
Any Person becoming entitled to any Shares in consequence of the death,
bankruptcy, or incompetence of any Shareholder, or otherwise by operation of
law, shall be recorded on the applicable register of Shares as the holder of
such Shares upon production of the proper evidence thereof to the Trustees or a
transfer agent of the Trust, but until such record is made, the Shareholder of
record shall be deemed to be the holder of such for all purposes hereof, and
neither the Trustees nor any transfer agent or registrar nor any officer or
agent of the Trust shall be affected by any notice of such death, bankruptcy or
incompetence, or other operation of law.
19
Section 5.10 Notices. Any and all notices to which any Shareholder
-------
hereunder may be entitled and any and all communications to any Shareholder
shall be deemed duly served or given if mailed, postage prepaid, addressed to
any Share holder of record at his or her last known address as recorded on the
applicable register of the Trust and may be sent together with any such notice
or other commu nication to another Shareholder at the same address.
Section 5.11 Net Asset Value. The value of the assets of the Trust or any
----------------
Series of the Trust or any Class of such Series, the amount of liabilities of
the Trust or any Series of the Trust or any Class of such Series and the net
asset value of each outstanding Share of any Series or Class shall be determined
at such time or times and on such days as the Trustees may determine in
accordance with the 1940 Act. The method of determination of net asset value
shall be determined by the Trustees. The power and duty to value the assets and
liabilities of the Trust and make net asset value determinations and
calculations may be delegated by the Trustees.
Section 5.12 Distributions to Shareholders.
-----------------------------
(a) The Trust shall from time to time distribute among the Shares
such proportion of the net profits, surplus (including paid-in surplus),
capital, or assets held by the Trustees as they or any Persons to whom they
delegate such determination may deem proper or as may otherwise be determined in
the instrument setting forth the terms of such Series or Class of Shares, which
need not be ratable with respect to distributions in respect of Shares of any
other Class. Such distribu tions may be made in cash or property (including
without limitation any type of obligations of the Trust or any assets thereof)
or any combination thereof.
(b) Distributions may be made to the Shareholders of record entitled
to such distribution at the time such distribution is declared or at such later
date as shall be determined by the Trust prior to the date of payment.
(c) The Trust may always retain from any source such amount as the
Trustees or their delegee may deem necessary to pay the debts or expenses of the
Trust or to meet obligations of the Trust, or as the Trustees or their delegee
otherwise may deem desirable to use in the conduct of its affairs or to retain
for future requirements or extensions of the business of the Trust.
20
ARTICLE VI
Shareholders
------------
Section 6.1 Meetings of Shareholders. The Trust may, but shall not be
--------------------------
required to, hold annual meetings of the Shareholders of any or all of the Class
or Series. An annual or special meeting of Shareholders may be called at any
time only by the Trustees; provided, however, that if May 31 of any year shall
have passed and the Trustees shall not have called an annual meeting of
Shareholders for such year, the Trustees shall call a meeting for the purpose of
voting on the removal of one or more Trustees or the termination of any
investment advisory agreement, upon written request of holders of Shares of the
Trust or a Series having in the aggregate not less than a majority of the votes
of the outstanding Shares of the Trust entitled to vote on the matter or matters
in question, such request specifying the purpose or purposes for which such
meeting is to be called. Any meeting of Shareholders shall be held within or
without the State of Delaware on such day and at such time as the Trustees shall
designate.
Section 6.2 Voting. Shareholders shall have no power to vote on any matter
------
except matters on which a vote of Shares is expressly required by applicable
law, this Declaration or resolution of the Trustees. In particular, no amendment
of this declaration, merger, consolidation, share exchange or sale of assets of
the Trust or any Series thereof, conversion of the Trust to any other form of
organization or any other action of the Trust or Series thereof shall require
any vote or other approval of any of the Shareholders except as provided by the
foregoing sentence. Any matter required to be submitted for approval of any of
the Shares and affecting more than one Series or Class shall require approval by
the required vote of Shares of the affected Series or Classes voting together as
a single Series or Class and, if such matter affects one or more Series or Class
thereof differently from one or more other Series or Class, approval, to the
extent provided by applicable law, this Declaration or resolution of the
Trustees, by the required vote of Shares of each such Series or Class voting as
a separate Series or Class shall be required in order to be approved with
respect to such Series or Class; provided, however, that except to the extent
required by the 1940 Act, there shall be no separate class votes on the election
or removal of Trustees or the selection of auditors for the Trust and its
Series. Share holders of a particular Series shall not be entitled to vote on
any matter that affects the rights or interests of only one or more other
Series. There shall be no cumulative voting in the election or removal of
Trustees.
21
Section 6.3 Notice of Meeting, Shareholder Proposals and Record Date.
-------------------------------------------------------------
Notice of all meetings of Shareholders, stating the time, place and purposes of
the meeting, shall be given by the Trustees by mail to each Shareholder of
record entitled to vote thereat at its registered address, mailed at least 10
days before the meeting or otherwise in compliance with applicable law. Except
with respect to an annual meeting, at which any business required by the 1940
Act may be conducted, only the business stated in the notice of the meeting
shall be considered at such meeting. Subject to the provisions of applicable
law, any Shareholder wishing to include a proposal to be considered at an annual
meeting must submit such proposal to the Trust at least 30 days in advance of
such meeting. Any adjourned meeting may be held as adjourned one or more times
without further notice not later than 130 days after the record date. For the
purposes of determining the Shareholders who are entitled to notice of and to
vote at any meeting the Trustees may, without closing the transfer books, fix a
date not more than 100 days prior to the date of such meeting of Shareholders as
a record date for the determination of the Persons to be treated as Shareholders
of record for such purposes.
Section 6.4 Quorum and Required Vote.
------------------------
(a) The holders of one-third of the outstanding Shares of the Trust
on the record date present in person or by proxy shall constitute a quorum at
any meeting of the Shareholders for purposes of conducting business on which a
vote of all Shareholders of the Trust is being taken. The holders of one-third
of the outstanding Shares of the affected Series or Classes on the record date
present in person or by proxy shall constitute a quorum at any meeting of the
Shareholders for purposes of conducting business on which a vote of Shareholders
of such Series or Classes is being taken. Shares underlying a proxy as to which
a broker or other intermediary states its absence of authority or lack of
instruction to vote with respect to one or more matters or fails to abstain or
vote on or against one or more matters shall be treated as present for purposes
of establishing a quorum or proportion of shares voted for taking action on any
such matter only to the extent so determined by the Trustees at or prior to the
meeting of Shareholders at which such matter is to be considered.
(b) Subject to any provision of applicable law, this Declaration or
a resolution of the Trustees specifying or requiring a greater or lesser vote
requirement for the transaction of any matter of business at any meeting of
Share holders, (i) the affirmative vote of a plurality of the Shares entitled to
vote for the election of any Trustee or Trustees shall be the act of such
Shareholders with respect
22
to the election of such Trustee or Trustees, (ii) the affirmative vote of a
majority of the Shares present in person or represented by proxy on any other
matter and entitled to vote on such matter shall be the act of the Shareholders
with respect to such matter, and (iii) where a separate vote of any Series or
Class is required on any matter, the affirmative vote of a majority of the
Shares of such Series or Class present in person or represented by proxy on such
matter and entitled to vote on such matter shall be the act of the Shareholders
of such Series or Class with respect to such matter.
Section 6.5 Proxies, etc. At any meeting of Shareholders, any holder of
-------------
Shares 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 verifica tion prior to the time at which such vote shall be taken.
Pursuant to a resolution of a majority of the Trustees, proxies may be solicited
in the name of one or more Trustees or one or more of the officers or employees
of the Trust. Only Shareholders of record shall be entitled to vote. Each full
Share shall be entitled to one vote and each fractional Share shall be entitled
to a vote equal to its fraction of a full Share. When any Share is held jointly
by several Persons, any one of them may vote at any meeting in person or by
proxy in respect of such Share, but if more than one of them shall be present at
such meeting in person or by proxy, and such joint owners or their proxies so
present disagree as to any vote to be cast, such vote shall not be received in
respect of such Share. A proxy purporting to be given by or on behalf of a
Shareholder of record on the record date for a meeting shall be deemed valid
unless challenged at or prior to its exercise, and the burden of proving
invalidity shall rest on the challenger. If the holder of any such Share is a
minor or a Person of unsound mind, and subject to guardianship or to the legal
control of any other Person as regards the charge or management of such Share,
he 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. The
Trustees shall have the authority to make and modify from time to time
regulations regarding the validity of proxies. In addition to signed proxies,
such regulations may authorize facsimile, telephonic, internet and other methods
of appointing a proxy that are subject to such supervision by or under the
direction of the Trustees as the Trustees shall determine.
Section 6.6 Reports. The Trustees shall cause to be prepared and sent to
-------
Shareholders at least annually and more frequently to the extent and in the form
required by law, regulation or any exchange on which Shares are listed a report
of operations containing financial statements of the Trust prepared in
conformity with generally accepted accounting principles and applicable law.
Separate reports
23
may be prepared for the various Series. Copies of such reports shall be mailed
to all Shareholders of record of the applicable Series within the time required
by the 1940 Act, and in any event within a reasonable period preceding the
meeting of Shareholders. The Trustees may prepare and send to Shareholders of
any Series or Class any other reports.
Section 6.7 Inspection of Records. The records of the Trust shall be open
---------------------
to inspection by Persons who have been holders of record of at least $25,000 in
net asset value or liquidation preference of Shares for a continuous period of
not less than six months to the same extent and for the same purposes as is
permitted under the Delaware General Business Corporation Law to shareholders of
a Delaware business corporation.
Section 6.8 Shareholder Action by Written Consent. Any action which may be
-------------------------------------
taken by Shareholders by vote may be taken without a meeting if the holders of
all of the Shares entitled to vote thereon consent to the action in writing and
the written consents are filed with the records of the meetings of Shareholders.
Such consent shall be treated for all purposes as a vote taken at a meeting of
Share holders.
ARTICLE VII
Redemption
----------
Section 7.1 Redemptions. All outstanding Shares of any Series of the Trust
-----------
or any Class thereof may be redeemed at the option of the holders thereof, upon
and subject to the terms and conditions provided in this Article VII. The Trust
shall, upon application by any Shareholder or pursuant to authorization from any
Shareholder of a particular Series or Class, redeem or repurchase from such
Share holder outstanding Shares of such Series or Class for an amount per share
determined by the application of a formula adopted for such purpose by the
Trustees with respect to such Series or Class (which formula shall be consistent
with the 1940 Act); provided that (a) such amount per share shall not exceed any
limitations imposed under applicable law and (b) if so authorized by the
Trustees, the Trust may, at any time and from time to time, charge fees for
effecting such redemption, at such rates as the Trustees may establish, as and
to the extent permitted under the 1940 Act, and may, at any time and from time
to time, pursuant to such Act, suspend such right of redemption. The procedures
for effecting redemption shall be as set forth in the Prospectus with respect to
the applicable Series or Class from time to time. The
24
proceeds of the redemption of Shares shall be paid in cash or property (tangible
or intangible) or any combination thereof in the sole discretion of the Trustees
or, if not determined by them, the Trust's investment advisor.
Section 7.2 Disclosure of Holding. The holders of Shares or other
-----------------------
securities of the Trust shall upon demand disclose to the Trustees in writing
such information with respect to direct and indirect ownership of Shares or
other securities of the Trust as the Trustees deem necessary to comply with the
provisions of the Code or any other applicable laws.
Section 7.3 Redemptions of Small Accounts. The Trustees shall have the
-------------------------------
power to redeem shares of any Series or Class at a redemption price determined
in accordance with Section 7.1 above, (a) if at any time the total invest ment
in such account does not have a value of at least such minimum amount as may be
specified in the Prospectus for such Series or Class from time to time, (b) as
provided by Section 3.8, or (c) to the extent a Shareholder or other Person
benefi cially owns Shares equal to or in excess of a percentage of Shares of the
Trust or any Series or Class determined from time to time by the Trustees and
specified in the applicable Prospectus. In the event the Trustees determine to
exercise their power to redeem Shares provided in subsection (a) of this Section
7.3, the Shareholder shall be notified that the value of his account is less
than the applicable minimum amount and shall be allowed 30 days to make an
appropriate investment before redemption is processed.
ARTICLE VIII
Duration: Termination of Trust; Amendment; Mergers, Etc.
--------------------------------------------------------
Section 8.1 Duration. Subject to termination in accordance with the
--------
provisions of Section 8.2 hereof, the Trust created hereby shall have perpetual
existence.
Section 8.2 Termination.
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(a) The Trust or any Series may be dissolved by the affirmative
vote of a majority of the Trustees, and without any vote of the Shareholders
thereof except as may be required by the 1940 Act. Upon the dissolution of the
Trust or any Series:
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(1) The Trust or such Series shall carry on no business
except for the purpose of winding up its affairs.
(2) The Trustees shall proceed to wind up the affairs of
the Trust or such Series and all of the powers of the Trustees under this
Declaration shall continue until the affairs of the Trust or such Series shall
have been wound up, including the power to fulfill or discharge the contracts of
the Trust or such Series, collect its assets, sell, convey, assign, exchange,
merge where the Trust is not the survivor, transfer or otherwise dispose of all
or any part of the remaining Trust Property to one or more Persons at a public
or private sale for consideration which may consist in whole or in part in cash,
securities or other property of any kind, discharge or pay its liabilities, and
do all other acts appropriate to liquidate its business; provided that any sale,
conveyance, assignment, exchange, merger in which the Trust is not the survivor,
transfer or other disposition of all or substan tially all the Trust Property of
the Trust or any Series shall require approval of the principal terms of the
transaction and the nature and amount of the consideration with the same vote as
required for disso lution pursuant to paragraph (a) above.
(3) 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 of the Trust or any Series, in cash
or in kind or partly in each, among the Shareholders of such Series according to
their respective rights.
(b) After the winding up and termination of the Trust or any Series
and distribution to the Shareholders as herein provided, a majority of the
Trustees shall execute and lodge among the records of the Trust an instrument in
writing setting forth the fact of such termination and shall execute and file a
certifi cate of cancellation with the Secretary of State of the State of
Delaware. Upon termination of the Trust, the Trustees shall thereupon be
discharged from all further liabilities and duties hereunder, and the rights and
interests of all Shareholders shall thereupon cease.
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Upon termination of any Series, the Trustees shall thereunder be discharged
from all further liabilities and duties with respect to such Series, and the
rights and interests of all Shareholders of such Series shall thereupon cease.
Section 8.3 Amendment Procedure.
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(a) Subject to Section 8.3(b), this Declaration may be amended in
any respect by the affirmative vote or approval in writing of two-thirds of the
Trustees and without any vote of the Shareholders of the Trust or any Series or
Class except as may be required by the 1940 Act.
(b) Nothing contained in this Declaration shall permit the amendment
of this Declaration to impair the exemption from personal liability of the
Shareholders, Trustees, officers, employees and agents of the Trust or to permit
assessments upon Shareholders. Expenses of the Trust charged directly to Share
holders pursuant to Section 3.8 hereof or fees or sales charges payable upon or
in connection with redemptions of Shares pursuant to Section 7.1 hereof shall
not constitute "assessments" for purposes of this Section 8.3(b).
(c) An amendment duly adopted by the requisite approval of the
Board of Trustees and, if required, Shareholders as aforesaid, shall become
effective at the time of such adoption or at such other time as may be
designated by the Board of Trustees or Shareholders, as the case may be. A
certification signed by a majority of the Trustees setting forth an amendment
and reciting that it was duly adopted by the Trustees and, if required,
Shareholders 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 or at such other time
designated by the Board.
Notwithstanding any other provision hereof, until such time as Shares are
issued and outstanding, 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 8.4 Merger, Consolidation and Sale of Assets. The Trust or any
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Series may merge or consolidate with any other corporation, association, trust
or other organization or any Series, sub-trust or other designated portion
thereof or may sell, lease or exchange all or substantially all of the Trust
Property or the property of any Series including its good will or may acquire
all or substantially all of the property of any other corporation, association,
trust or other organization or any
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series, sub-trust or other designated portion thereof, upon such terms and
conditions and for such consideration when and as authorized by two-thirds of
the Trustees and without any vote by the Shareholders of the Trust or any Series
or Class except as may be required by the 1940 Act, and any such merger,
consolidation, sale, lease, exchange or purchase shall be determined for all
purposes to have been accomplished under and pursuant to the statutes of the
State of Delaware.
ARTICLE IX
Miscellaneous
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Section 9.1 Filing. This Declaration and any amendment or supplement
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hereto shall be filed in such places as may be required or as the Trustees deem
appropriate. Each amendment or supplement shall be accompanied by a certificate
signed and acknowledged by a Trustee stating that such action was duly taken in
a manner provided herein, and shall, upon insertion in the Trust's minute book,
be conclusive evidence of all amendments contained therein. A restated
Declaration, containing the original Declaration and all amendments and
supplements theretofore made, may be executed from time to time by a majority of
the Trustees and shall, upon insertion in the Trust's minute book, be conclusive
evidence of all amendments and supplements contained therein and may thereafter
be referred to in lieu of the original Declaration and the various amendments
thereto.
Section 9.2 Resident Agent. The Trust shall maintain a resident agent in
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the State of Delaware, which agent shall initially be The Corporation Trust
Company, 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000. The Trustees may
designate a successor resident agent, provided, however, that such appointment
shall not become effective until written notice thereof is delivered to the
office of the Secretary of the State.
Section 9.3 Governing Law. This Declaration is executed by a majority of
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the Trustees for the purpose of creating a "statutory trust" under the Delaware
Statutory Trust Statue and establishing this Declaration as the "governing
instrument" of the Trust within the meaning of the Delaware Statutory Trust
Statue. The rights of all Persons hereunder and the validity and construction of
every provision hereof shall be subject to and construed according to the laws
of said State of Delaware and reference shall be specifically made to the
business corporation law of the State of Delaware as to the construction of
matters not specifically covered herein or as to which an ambiguity exists,
although such law shall not be viewed as
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limiting the powers otherwise granted to the Trustees hereunder and any
ambiguity shall be viewed in favor of such powers.
Section 9.4 Counterparts. This Declaration may be simultaneously executed
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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 9.5 Use of the Name "Baron". The name "Baron Select Funds Trust" or
-----------------------
"Baron" and all rights to the use thereof belong to BAMCO, Inc. BAMCO, Inc. has
consented to the use by the Trust of such name.
Section 9.6 Reliance by Third Parties. Any certificate executed by an
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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 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 Trust.
Section 9.7 Provisions in Conflict with Law or Regulation.
(a) The provisions of this Declaration are severable, and if the
Trustees shall determine, with the advice of counsel, that any of such
provisions is in conflict with the 1940 Act, the regulated investment company
provisions of the Code or with other applicable laws and regulations, the
conflicting provision shall be deemed never to have constituted a part of this
Declaration to the extent of such conflict; 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.
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IN WITNESS WHEREOF, the undersigned has caused these presents to be
executed as of the day and year first above written.
By: /s/ Xxxxxx Xxxxx
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Xxxxxx Xxxxx, Chairman and CEO
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