AGREEMENT AND DECLARATION OF TRUST
OF
CLAYMORE EQUITY TRUST
A Delaware Statutory Trust
FEBRUARY 15, 2005
TABLE OF CONTENTS
PAGE
Article 1 THE TRUST......................................................................................1
Section 1.1. Name..............................................................................1
Section 1.2. Location..........................................................................2
Section 1.3. Nature of Trust...................................................................2
Section 1.4. Definitions.......................................................................2
Section 1.5. Real Property to be Converted into Personal Property..............................5
Article 2 PURPOSE OF THE TRUST...........................................................................5
Article 3 POWERS OF THE TRUSTEES.........................................................................6
Section 3.1. Powers in General.................................................................6
Section 3.2. Borrowings; Financings; Issuance of Securities...................................10
Section 3.3. Deposits.........................................................................10
Section 3.4. Allocations......................................................................10
Section 3.5. Further Powers; Limitations......................................................11
Article 4 TRUSTEES AND OFFICERS.........................................................................11
Section 4.1. Number Designation, Election, Term, etc..........................................11
Section 4.2. Trustees' Meetings...............................................................13
Section 4.3. Committees; Delegation...........................................................13
Section 4.4. Officers.........................................................................13
Section 4.5. Compensation of Trustees and Officers............................................13
Section 4.6. Ownership of Shares and Securities of the Trust..................................14
Section 4.7. Right of Trustees and Officers to Own Property or to Engage in Business;
Authority of Trustees to Permit Others to Do Likewise............................14
Section 4.8. Reliance on Experts..............................................................14
Section 4.9. Surety Bonds.....................................................................15
Section 4.10. Apparent Authority of Trustees and Officers......................................15
Section 4.11. Other Relationships Not Prohibited...............................................15
Section 4.12. Payment of Trust Expenses........................................................16
Section 4.13. Ownership of the Trust Property..................................................16
Section 4.14. By-Laws..........................................................................16
Article 5 DELEGATION OF MANAGERIAL RESPONSIBILITIES.....................................................16
Section 5.1. Appointment; Action by Less than All Trustees....................................16
Section 5.2. Certain Contracts................................................................17
Section 5.3. Distribution Arrangements........................................................19
Section 5.4. Service Arrangements.............................................................19
Article 6 SERIES AND SHARES.............................................................................19
Section 6.1. Description of Series and Shares.................................................19
Section 6.2. Ownership of Shares..............................................................24
Section 6.3. Investments in the Trust.........................................................25
Section 6.4. No Preemptive Rights.............................................................25
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TABLE OF CONTENTS
(continued)
Section 6.5. Status of Shares.................................................................25
Article 7 SHAREHOLDERS' VOTING POWERS AND MEETINGS......................................................25
Section 7.1. Voting Powers....................................................................25
Section 7.2. Number of Votes and Manner of Voting; Proxies....................................26
Section 7.3. Meetings.........................................................................26
Section 7.4. Record Dates.....................................................................27
Section 7.5. Quorum and Required Vote.........................................................27
Section 7.6. Action By Written Consent........................................................27
Section 7.7. Inspection of Records............................................................27
Section 7.8. Additional Provisions............................................................28
Article 8 LIMITATION OF LIABILITY; INDEMNIFICATION......................................................28
Section 8.1. Trustees, Shareholders, etc......................................................28
Section 8.2. Trustees' Good Faith Action; Expert Advice; No Bond or Surety....................28
Section 8.3. Indemnification of Shareholders..................................................29
Section 8.4. Indemnification of Trustees, Officers, etc.......................................29
Section 8.5. Compromise Payment...............................................................30
Section 8.6. Indemnification Not Exclusive, etc...............................................30
Section 8.7. Liability of Third Persons Dealing with Trustees.................................31
Article 9 DURATION; REORGANIZATION; INCORPORATION; AMENDMENTS...........................................31
Section 9.1. Duration of Trust................................................................31
Section 9.2. Termination of Trust.............................................................31
Section 9.3. Reorganization...................................................................31
Section 9.4. Incorporation....................................................................32
Section 9.5. Amendments, etc..................................................................32
Section 9.6. Filing of Copies of Declaration and Amendments...................................32
Article 10 MISCELLANEOUS.................................................................................33
Section 10.1. Notices..........................................................................33
Section 10.2. Governing Law....................................................................33
Section 10.3. Counterparts.....................................................................33
Section 10.4. Reliance by Third Parties........................................................33
Section 10.5. References; Headings.............................................................33
Section 10.6. Provisions in Conflict With Law or Regulation....................................34
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AGREEMENT AND DECLARATION OF TRUST
OF
CLAYMORE EQUITY TRUST
AGREEMENT AND DECLARATION OF TRUST made as of the 15th day of February,
2005, by the Trustee 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 all in accordance with the provisions hereinafter
set forth;
WHEREAS, the Trustees have agreed to manage all property coming into
the hands of the Trust as Trustees of a Delaware Statutory Trust in accordance
with the provisions hereinafter set forth; and
WHEREAS, the Trustees 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 February 15, 2005 shall constitute a Statutory Trust under the
Delaware Statutory Trust Act 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 as hereinafter set forth.
ARTICLE 1
THE TRUST
Section 1.1 Name. The name of the Trust shall be:
CLAYMORE EQUITY TRUST
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 used in this Agreement and Declaration of Trust,
except where the context otherwise requires) shall refer to the Trustees in
their capacity as Trustees, and not individually or personally, and shall not
refer to the officers, agents or employees of the Trust or of such Trustees, or
to the holders of the Shares of the Trust or any Series. If the Trustees
determine that the use of such name is not practicable, legal or convenient at
any time or in any jurisdiction, the Trustees may use such other designation, or
they may adopt such other name for the Trust as they deem proper, and the Trust
may hold property and conduct its activities under such designation or name.
Section 1.2 Location. The Trust shall maintain a registered office in
the State of Delaware and may have such other offices or places of business as
the Trustees may from time to time determine to be necessary or expedient.
Section 1.3 Nature of Trust. The Trust shall be a trust with
transferable shares under the laws of The State of Delaware, of the type defined
in Title 12, Chapter 38, Section 3801 of the Delaware Code as a statutory trust.
The Trust is not intended to be, shall not be deemed to be, and shall not be
treated as, a general partnership, limited partnership, joint venture,
corporation or joint stock company. The Shareholders shall be beneficiaries and
their relationship to the Trustees shall be solely in that capacity in
accordance with the rights conferred upon them hereunder.
Section 1.4 Definitions. As used in this Agreement and Declaration of
Trust, the following terms shall have the meanings set forth below unless the
context thereof otherwise requires:
"ACCOUNTING AGENT" shall have the meaning designated in Section 5.2(g)
hereof.
"ADMINISTRATOR" shall have the meaning designated in Section 5.2(b)
hereof.
"AFFILIATED PERSON" shall have the meaning assigned to it in the 1940
Act.
"BY-LAWS" shall mean the By-Laws of the Trust, as amended from time to
time.
"CERTIFICATE OF DESIGNATION" shall have the meaning designated in
Section 6.1 hereof.
"CERTIFICATE OF TERMINATION" shall have the meaning designated in
Section 6.1 hereof.
"CLASS" or "CLASSES" shall mean, with respect to any Series, any
unissued Shares of such Series in respect of which the Trustees shall from time
to time fix and determine any special provisions relating to sales charges, any
rights of redemption and the price, terms and manner of redemption, special and
relative rights as to dividends and other distributions and on liquidation,
sinking or purchase fund provisions, conversion rights, and conditions under
which the Shareholders of such Class shall have separate voting rights or no
voting rights.
"COMMISSION" shall have the same meaning as in the 1940 Act.
"CONTRACTING PARTY" shall have the meaning designated in the preamble
to Section 5.2 hereof.
"CONVERSION DATE" shall mean with respect to Shares of any Class that
are convertible automatically into Shares of any other Class of a Series the
date fixed by the Trustees for such conversion.
"COVERED PERSON" shall have the meaning designated in Section 8.4
hereof.
"CUSTODIAN" shall have the meaning designated in Section 5.2(d) hereof.
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"DECLARATION" and "DECLARATION OF TRUST" shall mean this Agreement and
Declaration of Trust and all amendments or modifications thereof as from time to
time in effect. This Agreement and Declaration of Trust is the "governing
instrument" of the Trust within the meaning of the laws of the State of Delaware
with respect to Delaware statutory trusts. References in this Agreement and
Declaration of Trust to "hereof", "herein" and "hereunder" shall be deemed to
refer to the Declaration of Trust generally, and shall not be limited to the
particular text, Article or Section in which such words appear.
"DISABLING CONDUCT" shall have the meaning designated in Section 8.4
hereof.
"DISTRIBUTOR" shall have the meaning designated in Section 5.2(c)
hereof.
"DIVIDEND DISBURSING AGENT" shall have the meaning designated in
Section 5.2(e) hereof.
"GENERAL ITEMS" shall have the meaning defined in Section 6.1(e)
hereof.
"INVESTMENT ADVISOR" shall have the meaning defined in Section 5.2(a)
hereof.
"MAJORITY OF THE TRUSTEES" shall mean a majority of the Trustees in
office at the time in question. At any time at which there shall be only one (1)
Trustee in office, such term shall mean such Trustee.
"MAJORITY SHAREHOLDER VOTE," as used with respect to (a) the election
of any Trustee at a meeting of Shareholders, shall mean the vote for the
election of such Trustee of a plurality of all outstanding Shares of the Trust,
without regard to Series, represented in person or by proxy and entitled to vote
thereon, provided that a quorum (as determined in accordance with the By-Laws)
is present, (b) any other action required or permitted to be taken by
Shareholders, shall mean the vote for such action of the holders of that
majority of all outstanding Shares (or, where a separate vote of Shares of any
particular Series is to be taken, the affirmative vote of that majority of the
outstanding Shares of that Series) of the Trust which consists of: (i) a
majority of all Shares (or of Shares of the particular Series) represented in
person or by proxy and entitled to vote on such action at the meeting of
Shareholders at which such action is to be taken, provided that a quorum (as
determined in accordance with the By-Laws) is present; or (ii) if such action is
to be taken by written consent of Shareholders, a majority of all Shares (or of
Shares of the particular Series) issued and outstanding and entitled to vote on
such action; provided that (iii) as used with respect to any action requiring
the affirmative vote of "a majority of the outstanding voting securities," as
the quoted phrase is defined in the 1940 Act, of the Trust or of any Series,
"Majority Shareholder Vote" means the vote for such action at a meeting of
Shareholders of the smallest majority of all outstanding Shares of the Trust (or
of Shares of the particular Series) entitled to vote on such action which
satisfies such 1940 Act voting requirement.
"1940 ACT" shall mean the provisions of the Investment Company Act of
1940 and the rules and regulations thereunder, both as amended from time to
time, and any order or orders thereunder which may from time to time be
applicable to the Trust.
"PERSON" shall mean and include individuals, as well as corporations,
limited partnerships, general partnerships, joint stock companies, joint
ventures, associations, banks,
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trust companies, land trusts, statutory trusts or other organizations
established under the laws of any jurisdiction, whether or not considered to be
legal entities, and governments and agencies and political subdivisions thereof.
"PRINCIPAL UNDERWRITER" shall have the meaning designated in Section
5.2(c) hereof.
"PROSPECTUS," as used with respect to the Trust (or the Shares of a
particular Series), shall mean the prospectus relating to the Trust (or such
Series) which constitutes part of the currently effective Registration Statement
of the Trust under the Securities Act of 1933, as such prospectus may be amended
or supplemented from time to time.
"SECURITIES" shall have the same meaning ascribed to that term in the
Securities Act of 1993.
"SERIES" shall mean one or more of the series of Shares authorized by
the Trustees to represent the beneficial interest in one or more separate
components of the assets of the Trust which are now or hereafter established and
designated under or in accordance with the provisions of Article 6 hereof.
"SHAREHOLDER" shall mean as of any particular time any Person shown of
record at such time on the books of the Trust as a holder of outstanding Shares
of any Series, and shall include a pledgee into whose name any such Shares are
transferred in pledge.
"SHAREHOLDER SERVICING AGENT" shall have the meaning designated in
Section 5.2(f) hereof.
"SHARES" shall mean the transferable units into which the beneficial
interest in the Trust and each Series of the Trust (as the context may require)
shall be divided from time to time, and includes fractions of Shares as well as
whole Shares. All references herein to "Shares" which are not accompanied by a
reference to any particular Series or Class shall be deemed to apply to
outstanding Shares without regard to Series or Class.
"SINGLE CLASS VOTING," as used with respect to any matter to be acted
upon at a meeting or by written consent of Shareholders, shall mean a style of
voting in which each holder of one or more Shares shall be entitled to one vote
on the matter in question for each Share standing in his name on the records of
the Trust, irrespective of Series or Class of a Series, and all outstanding
Shares of all Series vote as a single class.
"STATEMENT OF ADDITIONAL INFORMATION," as used with respect to the
Trust (or any Series), shall mean the statement of additional information
relating to the Trust (or such Series) which constitutes part of the currently
effective Registration Statement of the Trust under the Securities Act of 1933,
as such statement of additional information may be amended or supplemented from
time to time.
"TRANSFER AGENT" shall have the meaning defined in Section 5.2(e)
hereof.
"TRUST" shall mean the trust named in Section 1.1 hereof.
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"TRUST PROPERTY" shall mean, as of any particular time, any and all
property which shall have been transferred, conveyed or paid to the Trust or the
Trustees, and all interest, dividends, income, earnings, profits and gains
therefrom, and proceeds thereof, including any proceeds derived from the sale,
exchange or liquidation thereof, and any funds or payments derived from any
reinvestment of such proceeds in whatever form the same may be, and which at
such time is owned or held by, or for the account of, the Trust or the Trustees,
without regard to the Series to which such property is allocated.
"TRUSTEES" shall mean, collectively, the Initial Trustees, so long as
they shall continue in office, and all other individuals who at the time in
question have been duly elected or appointed as Trustees of the Trust in
accordance with the provisions hereof and who have qualified and are then in
office. At any time at which there shall be only one (l) Trustee in office, such
term shall mean such single Trustee.
Section 1.5 Real Property to be Converted into Personal Property.
Notwithstanding any other provision hereof, any real property at any time
forming part of the Trust Property shall be held in trust for sale and
conversion into personal property at such time or times and in such manner and
upon such terms as the Trustees shall approve, but the Trustees shall have power
until the termination of this Trust to postpone such conversion as long as they
in their uncontrolled discretion shall think fit, and for the purpose of
determining the nature of the interest of the Shareholders therein, all such
real property shall at all times be considered as personal property.
ARTICLE 2
PURPOSE OF THE TRUST
The purpose of the Trust shall be to (a) manage, conduct, operate and
carry on the business of an open-end investment company registered under the
1940 Act; (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 nonequity, of any issuer, evidences of indebtedness of any person and any
other rights, interest, instruments or property of any sort to exercise any and
all rights, powers and privileges of ownership or interest in respect of any and
all such investment 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.
Not limited by the foregoing, the Trust shall have and may exercise all of the
powers conferred by the laws of the state of Delaware concerning Statutory
Trusts.
ARTICLE 3
POWERS OF THE TRUSTEES
Section 3.1 Powers in General. The Trustees shall have, without other
or further authorization, full, entire, exclusive and absolute power, control
and authority over, and
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management of, the business of the Trust and over the Trust Property, to the
same extent as if the Trustees were the sole owners of the business and property
of the Trust in their own right, and with such powers of delegation as may be
permitted by this Declaration, subject only to such limitations as may be
expressly imposed by this Declaration of Trust or by applicable law. The
enumeration of any specific power or authority herein shall not be construed as
limiting the aforesaid power or authority or any specific power or authority.
Without limiting the foregoing; they may select, and from time to time change,
the fiscal year of the Trust; they may adopt and use a seal for the Trust,
provided that unless otherwise required by the Trustees, it shall not be
necessary to place the seal upon, and its absence shall not impair the validity
of, any document, instrument or other paper executed and delivered by or on
behalf of the Trust; they may from time to time in accordance with the
provisions of Section 6.1 hereof establish one or more Series to which they may
allocate such of the Trust Property, subject to such liabilities, as they shall
deem appropriate, each such Series to be operated by the Trustees as a separate
and distinct investment medium and with separately defined investment objectives
and policies, all as established by the Trustees, or from time to time changed
by them; they may as they consider appropriate elect and remove officers and
appoint and terminate agents and consultants and hire and terminate employees,
any one or more of the foregoing of whom may be a Trustee; they may appoint from
their own number, and terminate, any one or more committees consisting of one or
more Trustees, including without implied limitation an Executive Committee,
which may, when the Trustees are not in session and subject to the 1940 Act,
exercise some or all of the power and authority of the Trustees as the Trustees
may determine; in accordance with Section 5.2 they may employ one or more
Investment Advisers, Administrators and Custodians and may authorize any such
service provider to employ one or more other service providers and to deposit
all or any part of such assets in a system or systems for the central handling
of Securities, retain Transfer, Dividend Disbursing, Accounting or Shareholder
Servicing Agents or any of the foregoing, provide for the distribution of Shares
by the Trust through one or more Distributors, Principal Underwriters or
otherwise, set record dates or times for the determination of Shareholders
entitled to participate in, benefit from or act with respect to various matters;
and in general they may delegate to any officer of the Trust, to any Committee
of the Trustees and to any employee, Investment Adviser, Administrator,
Distributor, Custodian, Transfer Agent, Dividend Disbursing Agent, or any other
agent or consultant of the Trust, such authority, powers, functions and duties
as they consider desirable or appropriate for the conduct of the business and
affairs of the Trust, including without implied limitation the power and
authority to act in the name of the Trust and of the Trustees, to sign documents
and to act as attorney-in-fact for the Trustees. Without limiting the foregoing
and to the extent not inconsistent with the 1940 Act or other applicable law,
the Trustees shall have power and authority:
(a) Investments. To 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 nonequity, of any
issuer, evidences of indebtedness of any person and any other rights,
interest, instruments or property of any sort, 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
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privileges in respect of any of said investments, in every case without
being limited by any law limiting the investments which may be made by
fiduciaries;
(b) Disposition of Assets. Upon such terms and conditions as
they deem best, to lend, sell, exchange, mortgage, pledge, hypothecate,
grant security interests in, encumber, negotiate, convey, transfer or
otherwise dispose of, and to trade in, any and all of the Trust
Property, free and clear of all trusts, for cash or on terms, with or
without advertisement, and on such terms as to payment, security or
otherwise, all as they shall deem necessary or expedient;
(c) Ownership Powers. To vote or give assent, or exercise any
and all other rights, powers and privileges of ownership with respect
to, and to perform any and all duties and obligations as owners of, any
Securities or other property forming part of the Trust Property, the
same as any individual might do; to exercise powers and rights of
subscription or otherwise which in any manner arise out of ownership of
Securities, and to receive powers of attorney from, and to execute and
deliver proxies or powers of attorney to, such Person or Persons as the
Trustees shall deem proper, receiving from or granting to such Person
or Persons such power and discretion with relation to Securities or
other property of the Trust, all as the Trustees shall deem proper;
(d) Form of Holding. To hold any Security or other property in
a form not indicating any trust, whether in bearer, unregistered or
other negotiable form, or in the name of the Trustees or of the Trust,
or of the Series to which such Securities or property belong, or in the
name of a Custodian, sub-custodian or other nominee or nominees, or
otherwise, upon such terms, in such manner or with such powers, as the
Trustees may determine, and with or without indicating any trust or the
interest of the Trustees therein;
(e) Reorganizations, etc. To consent to or participate in any
plan for the reorganization, consolidation or merger of any corporation
or issuer, any Security of which is or was held in the Trust or any
Series; to consent to any contract, lease, mortgage, purchase or sale
of property by such corporation or issuer, and to pay calls or
subscriptions with respect to any Security forming part of the Trust
Property;
(f) Voting Trusts, etc. To join with other holders of any
Securities in acting through a committee, depository, voting trustee or
otherwise, and in that connection to deposit any Security with, or
transfer any Security to, any such committee, depository or trustee,
and to delegate to them such power and authority with relation to any
Security (whether or not so deposited or transferred) as the Trustees
shall deem proper, and to agree to pay, and to pay, such portion of the
expenses and compensation of such committee, depository or trustee as
the Trustees shall deem proper;
(g) Contracts, etc. To enter into, make and perform all such
obligations, contracts, agreements and undertakings of every kind and
description, with any Person or Persons, as the Trustees shall in their
discretion deem expedient in the conduct of the business of the Trust,
for such terms as they shall see fit, whether or not extending beyond
the term of office of the Trustees, or beyond the possible expiration
of the Trust; to amend, extend, release or cancel any such obligations,
contracts, agreements or
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understandings; and to execute, acknowledge, deliver and record all
written instruments which they may deem necessary or expedient in the
exercise of their powers;
(h) Guarantees, etc. To endorse or guarantee the payment of
any notes or other obligations of any Person; to make contracts of
guaranty or suretyship, or otherwise assume liability for payment
thereof; and to mortgage and pledge the Trust Property or any part
thereof to secure any of or all such obligations;
(i) Partnerships, etc. To enter into joint ventures, general
or limited partnerships and any other combinations or association;
(j) Insurance. To purchase and pay for entirely out of Trust
Property such insurance as they may deem necessary or appropriate for
the conduct of the business, including, without limitation, insurance
policies insuring the assets of the Trust and payment of distributions
and principal on its portfolio investments, and insurance policies
insuring the Shareholders, Trustees, officers, employees, agents,
consultants, Investment Advisers, managers, Administrators,
Distributors, Principal Underwriters, or other independent contractors,
or any thereof (or any Person connected therewith), of the Trust,
individually, against all claims and liabilities of every nature
arising by reason of holding, being or having held any such office or
position, or by reason of any action alleged to have been taken or
omitted by any such Person in any such capacity, whether or not the
Trust would have the power to indemnify such Person against such
liability;
(k) Pensions, etc. To pay pensions for faithful service, as
deemed appropriate by the Trustees, and to adopt, establish and carry
out pension, profit sharing, share bonus, share purchase, savings,
thrift, deferred compensation and other retirement, incentive and
benefit plans, trusts and provisions, including the purchasing of life
insurance and annuity contracts as a means of providing such retirement
and other benefits, for any or all of the Trustees, officers, employees
and agents of the Trust;
(l) Power of Collection and Litigation. To collect, xxx for
and receive all sums of money coming due to the Trust, to employ
counsel, and to commence, engage in, prosecute, intervene in, join,
defend, compound, compromise, adjust or abandon, in the name of the
Trust, any and all actions, suits, proceedings, disputes, claims,
controversies, demands or other litigation or legal proceedings
relating to the Trust, the business of the Trust, the Trust Property,
or the Trustees, officers, employees, agents and other independent
contractors of the Trust, in their capacity as such, at law or in
equity, or before any other bodies or tribunals, and to compromise,
arbitrate or otherwise adjust any dispute to which the Trust may be a
party, whether or not any suit is commenced or any claim shall have
been made or asserted. Except to the extent required for a Delaware
Statutory Trust, the Shareholders shall have no power to vote as to
whether or not a court action, legal proceeding or claim should or
should not be brought or maintained derivatively or as a class action
on behalf of the Trust or the Shareholders.
(m) Issuance and Repurchase of Shares. To authorize, issue,
sell, repurchase, redeem, retire, cancel, acquire, hold, resell,
reissue, dispose of, transfer, and otherwise deal in Shares of any
Series, and, subject to Article 6 hereof, to apply to any such
8
repurchase, redemption, retirement, cancellation or acquisition of
Shares of any Series, any of the assets belonging to the Series to
which such Shares relate, whether constituting capital or surplus or
otherwise, to the full extent now or hereafter permitted by applicable
law; provided that any Shares belonging to the Trust shall not be
voted, directly or indirectly;
(n) Offices. To have one or more offices, and to carry on all
or any of the operations and business of the Trust, in any of the
States, Districts or Territories of the United States, and in any and
all foreign countries, subject to the laws of such State, District,
Territory or country;
(o) Expenses. To incur and pay any and all such expenses and
charges as they may deem advisable (including without limitation
appropriate fees to themselves as Trustees), and to pay all such sums
of money for which they may be held liable by way of damages, penalty,
fine or otherwise;
(p) Agents, etc. To retain and employ any and all such
servants, agents, employees, attorneys, brokers, Investment Advisers,
accountants, architects, engineers, builders, escrow agents,
depositories, consultants, ancillary trustees, custodians, agents for
collection, insurers, banks and officers, as they think best for the
business of the Trust or any Series, to supervise and direct the acts
of any of the same, and to fix and pay their compensation and define
their duties;
(q) Accounts. To determine, and from time to time change, the
method or form in which the accounts of the Trust or any Series shall
be kept;
(r) Valuation. Subject to the requirements of the 1940 Act, to
determine from time to time the value of all or any part of the Trust
Property and of any services, assets, Securities, property or other
consideration to be furnished to or acquired by the Trust, and from
time to time to revalue all or any part of the Trust Property in
accordance with such appraisals or other information as is, in the
Trustees' sole judgment, necessary and satisfactory;
(s) Indemnification. In addition to the mandatory
indemnification provided for in Article 8 hereof and to the extent
permitted by law, to indemnify or enter into agreements with respect to
indemnification with any Person with whom this Trust has dealings,
including, without limitation, any independent contractor, to such
extent as the Trustees shall determine; and
(t) General. Subject to the fundamental policies in effect
from time to time with respect to the Trust, to do all such other acts
and things and to conduct, operate, carry on and engage in such other
lawful businesses or business activities as they shall in their sole
and absolute discretion consider to be incidental to the business of
the Trust or any Series as an investment company, and to exercise all
powers which they shall in their discretion consider necessary, useful
or appropriate to carry on the business of the Trust or any Series, to
promote any of the purposes for which the Trust is formed, whether or
not such things are specifically mentioned herein, in order to protect
or promote the
9
interests of the Trust or any Series, or otherwise to carry out the
provisions of this Declaration.
Section 3.2. Borrowings; Financings; Issuance of Securities. The
Trustees have power, subject to the fundamental policies in effect from time to
time with respect to the Trust, to borrow or in any other manner raise such sum
or sums of money, and to incur such other indebtedness for goods or services, or
for or in connection with the purchase or other acquisition of property, as they
shall deem advisable for the purposes of the Trust, in any manner and on any
terms, and to evidence the same by negotiable or nonnegotiable Securities which
may mature at any time or times, even beyond the possible date of termination of
the Trust; to issue Securities of any type for such cash, property, services or
other considerations, and at such time or times and upon such terms, as they may
deem advisable; and to reacquire any such Securities. Any such Securities of the
Trust may, at the discretion of the Trustees, be made convertible into Shares of
any Series, or may evidence the right to purchase, subscribe for or otherwise
acquire Shares of any Series, at such times and on such terms as the Trustees
may prescribe.
Section 3.3. Deposits. Subject to the requirements of the 1940 Act, the
Trustees shall have power to deposit any moneys or Securities included in the
Trust Property with any one or more banks, trust companies or other banking
institutions, whether or not such deposits will draw interest. Such deposits are
to be subject to withdrawal in such manner as the Trustees may determine, and
the Trustees shall have no responsibility for any loss which may occur by reason
of the failure of the bank, trust company or other banking institution with
which any such moneys or Securities have been deposited, except as provided in
Section 8.2 hereof. Section 3.4. Allocations. The Trustees shall have power to
determine whether moneys or other assets received by the Trust shall be charged
or credited to income or capital, or allocated between income and capital,
including the power to amortize or fail to amortize any part or all of any
premium or discount, to treat any part or all of the profit resulting from the
maturity or sale of any asset, whether purchased at a premium or at a discount,
as income or capital, or to apportion the same between income and capital, to
apportion the sale price of any asset between income and capital, and to
determine in what manner any expenses or disbursements are to be borne as
between income and capital, whether or not in the absence of the power and
authority conferred by this Section 3.4 such assets would be regarded as income
or as capital or such expense or disbursement would be charged to income or to
capital; to treat any dividend or other distribution on any investment as income
or capital, or to apportion the same between income and capital; to provide or
fail to provide reserves, including reserves for depreciation, amortization or
obsolescence in respect of any Trust Property in such amounts and by such
methods as they shall determine; to allocate less than all of the consideration
paid for Shares of any Series to surplus with respect to the Series to which
such Shares relate and to allocate the balance thereof to paid-in capital of
that Series, and to reallocate such amounts from time to time; all as the
Trustees may reasonably deem proper.
Section 3.5. Further Powers; Limitations. The Trustees shall have power
to do all such other matters and things 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 and
territories, dependencies, colonies, possessions, agencies or instrumentalities
of the United States of America and of foreign countries, and to execute all
10
such instruments, as they deem necessary, proper or desirable in order to carry
out, promote or advance the interests of the Trust, although such matters or
things are not herein specifically mentioned. Any determination as to what is in
the interests of the Trust made by the Trustees in good faith shall be
conclusive. In construing the provisions of this Declaration of Trust, 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 the Trust Property.
The Trustees may limit their right to exercise any of their powers through
express restrictive provisions in the instruments evidencing or providing the
terms for any Securities of the Trust or in other contractual instruments
adopted on behalf of the Trust.
ARTICLE 4
TRUSTEES AND OFFICERS
Section 4.1. Number Designation, Election, Term, etc.
(a) Initial Trustees. Upon their execution of this Declaration
of Trust or a counterpart hereof or some other writing in which they
accept such Trusteeship and agrees to the provisions hereof, the
individuals whose signatures are affixed hereto as Initial Trustees
shall become the Initial Trustees hereof. Prior to a public offering of
Shares there may be a sole Trustee.
(b) Number. The Trustees serving as such, whether named above
or hereafter becoming Trustees, may increase (to not more than twenty
(20)) or decrease the number of Trustees to a number other than the
number theretofore determined by a Majority of the Trustees (or by an
officer of the Trust pursuant to the vote of a Majority of the
Trustees). No decrease in the number of Trustees shall have the effect
of removing any Trustee from office prior to the expiration of his
term, but the number of Trustees may be decreased in conjunction with
the removal of a Trustee pursuant to subsection (e) of this Section
4.1.
(c) Election and Term. The Trustees shall be elected by the
Shareholders of the Trust at the first meeting of Shareholders
immediately prior to the initial public offering of Shares of the
Trust, and the term of office of any Trustees in office before such
election shall terminate at the time of such election. Subject to
Section 16(a) of the 1940 Act and to the preceding sentence of this
subsection (c), the Trustees shall have the power to set and alter the
terms of office of the Trustees, and at any time to lengthen or shorten
their own terms or make their terms of unlimited duration, to elect
their own successors and, pursuant to subsection (f) of this Section
4.1, to appoint Trustees to fill vacancies; provided that Trustees
shall be elected by a Majority Shareholder Vote at any such time or
times as the Trustees shall determine that such action is required
under Section 16(a) of the 1940 Act or, if not so required, that such
action is advisable; and further provided that, after the initial
election of Trustees by the Shareholders, the term of office of any
incumbent Trustee shall continue until the termination of this Trust or
his earlier death, resignation, retirement, bankruptcy, adjudicated
incompetency or other incapacity or removal, or if not so terminated,
until the election of such Trustee's successor in office has become
effective.
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(d) Resignation and Retirement. Any Trustee may resign his
trust or retire as a Trustee, by a written instrument signed by him and
delivered to the other Trustees or to any officer of the Trust
specified in the By-Laws, and such resignation or retirement shall take
effect upon such delivery or upon such later date as is specified in
such instrument.
(e) Removal. Any Trustee may be removed with or without cause
at any time: (i) by written instrument, signed by at least two thirds
(2/3) of the number of Trustees prior to such removal, specifying the
date upon which such removal shall become effective; or (ii) by vote of
Shareholders holding not less than two thirds (2/3) of the Shares of
each Series then outstanding, cast in person or by proxy at any meeting
called for the purpose; or (iii) by a written declaration signed by
Shareholders holding not less than two thirds (2/3) of the Shares of
each Series then outstanding. Upon incapacity or death of any Trustee,
his legal representative shall execute and deliver on his behalf such
documents as the remaining Trustees shall require in order to effect
the purpose of this Paragraph.
(f) Vacancies. Any vacancy or anticipated vacancy resulting
from any reason, including an increase in the number of Trustees, may
(but need not unless required by the 0000 Xxx) be filled by a Majority
of the Trustees, subject to the provisions of Section 16(a) of the 1940
Act, through the appointment of such other individual as such remaining
Trustees in their discretion shall determine; provided that if there
shall be no Trustees in office, such vacancy or vacancies shall be
filled by Majority Shareholders Vote. Any such appointment or election
shall be effective upon such individual's written acceptance of his
appointment as a Trustee and his agreement to be bound by the
provisions of this Declaration of Trust, except that any such
appointment in anticipation of a vacancy to occur by reason of
retirement, resignation or increase in the number of Trustees to be
effective at a later date shall become effective only at or after the
effective date of said retirement, resignation or increase in the
number of Trustees.
(g) Effect of Death, Resignation, etc. No vacancy, whether
resulting from the death, resignation, retirement, bankruptcy,
adjudicated incompetency, incapacity, or removal of any Trustee, an
increase in the number of Trustees or otherwise, shall operate to annul
or terminate the Trust hereunder or to revoke or terminate any existing
agency or contract created or entered into pursuant to the terms of
this Declaration of Trust. Until such vacancy is filled as provided in
this Section 4.1, the Trustees in office (if any), 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.
(h) No Accounting. Except to the extent required by the 1940
Act or under circumstances which would justify his removal for cause,
no Person ceasing to be a Trustee (nor the estate of any such Person)
shall be required to make an accounting to the Shareholders or
remaining Trustees upon such cessation.
Section 4.2. Trustees' Meetings. Annual and special meetings may be
held from time to time, in each case, upon the call of such officers as may be
thereunto authorized by the By-Laws or vote of the Trustees, or by any two (2)
Trustees, or pursuant to a vote of the Trustees adopted at a duly constituted
meeting of the Trustees, and upon such notice as shall be provided
12
in the By-Laws. Any such meeting may be held within or without the state of
Delaware. The Trustees may act with or without a meeting, and a written consent
to any matter, signed by a Majority of the Trustees, shall be equivalent to
action duly taken at a meeting of the Trustees, duly called and held. Except as
otherwise provided by the 1940 Act or other applicable law, or by this
Declaration of Trust or the By-Laws, any action to be taken by the Trustees may
be taken by a majority of the Trustees present at a meeting of Trustees (a
quorum, consisting of at least a Majority of the Trustees, being present),
within or without Delaware. If authorized by the By-Laws, all or any one or more
Trustees may participate in a meeting of the Trustees or any Committee thereof
by means of conference telephone or similar means of communication by means of
which all Persons participating in the meeting can hear each other, and
participation in a meeting pursuant to such means of communication shall
constitute presence in person at such meeting. The minutes of any meeting thus
held shall be prepared in the same manner as a meeting at which all participants
were present in person.
Section 4.3. Committees; Delegation. The Trustees shall have power,
consistent with their ultimate responsibility to supervise the affairs of the
Trust, to delegate from time to time to one or more other Committees, or to any
single Trustee, the doing of such things and the execution of such deeds or
other instruments, either in the name of the Trust or the names of the Trustees
or as their attorney or attorneys in fact, or otherwise as the Trustees may from
time to time deem expedient, and any agreement, deed, mortgage, lease or other
instrument or writing executed by the Trustee or Trustees or other Person to
whom such delegation was made shall be valid and binding upon the Trustees and
upon the Trust.
Section 4.4. Officers. The Trustees shall elect such officers or
agents, who shall have such powers, duties and responsibilities as the Trustees
may deem to be advisable, and as they shall specify by resolution or in the
By-Laws. Except as may be provided in the By-Laws, any officer elected by the
Trustees may be removed at any time with or without cause. Any two (2) or more
offices may be held by the same individual.
Section 4.5. Compensation of Trustees and Officers. The Trustees shall
fix the compensation of all officers and Trustees. Without limiting the
generality of any of the provisions hereof, the Trustees shall be entitled to
receive reasonable compensation for their general services as such, and to fix
the amount of such compensation, and to pay themselves or any one or more of
themselves such compensation for special services, including legal, accounting,
or other professional services, as they in good faith may deem reasonable. No
Trustee or officer resigning (except where a right to receive compensation for a
definite future period shall be expressly provided in a written agreement with
the Trust, duly approved by the Trustees) and no Trustee or officer removed
shall have any right to any compensation as such Trustee or officer for any
period following his resignation or removal, or any right to damages on account
of his removal, whether his compensation be by the month, or the year or
otherwise.
Section 4.6. Ownership of Shares and Securities of the Trust. Any
Trustee, and any officer, employee or agent of the Trust, and any organization
in which any such Person is interested, may acquire, own, hold and dispose of
Shares of any Series and other Securities of the Trust for his or its individual
account, and may exercise all rights of a holder of such Shares or Securities to
the same extent and in the same manner as if such Person were not such a
Trustee, officer, employee or agent of the Trust; subject, in the case of
Trustees and officers, to the same
13
limitations as directors or officers (as the case may be) of a Delaware business
corporation; and the Trust may issue and sell or cause to be issued and sold and
may purchase or redeem any such Shares or other Securities from any such Person
or any such organization, subject only to the general limitations, restrictions
or other provisions applicable to the sale or purchase of Shares of such Series
or other Securities of the Trust generally.
Section 4.7. Right of Trustees and Officers to Own Property or to
Engage in Business; Authority of Trustees to Permit Others to Do Likewise. The
Trustees, in their capacity as Trustees, and (unless otherwise specifically
directed by vote of the Trustees) the officers of the Trust in their capacity as
such, shall not be required to devote their entire time to the business and
affairs of the Trust. Except as otherwise specifically provided by vote of the
Trustees, or by agreement in any particular case, any Trustee or officer of the
Trust may acquire, own, hold and dispose of, for his own individual account, any
property, and acquire, own, hold, carry on and dispose of, for his own
individual account, any business entity or business activity, whether similar or
dissimilar to any property or business entity or business activity invested in
or carried on by the Trust, and without first offering the same as an investment
opportunity to the Trust subject to any policies or procedures concerning
investment opportunities approved by the Trustees, and may exercise all rights
in respect thereof as if he were not a Trustee or officer of the Trust. The
Trustees shall also have power, generally or in specific cases, to permit
employees or agents of the Trust to have the same rights (or lesser rights) to
acquire, hold, own and dispose of property and businesses, to carry on
businesses, and to accept investment opportunities without offering them to the
Trust, as the Trustees have by virtue of this Section 4.7.
Section 4.8. Reliance on Experts. The Trustees and officers may consult
with counsel, engineers, brokers, appraisers, auctioneers, accountants,
investment bankers, securities analysts or other Persons (any of which may be a
firm in which one or more of the Trustees or officers is or are members or
otherwise interested) whose profession gives authority to a statement made by
them on the subject in question, and who are reasonably deemed by the Trustees
or officers in question to be competent, and the advice or opinion of such
Persons shall be full and complete personal protection to all of the Trustees
and officers in respect of any action taken or suffered by them in good faith
and in reliance on or in accordance with such advice or opinion. In discharging
their duties, Trustees and officers, when acting in good faith, may rely upon
financial statements of the Trust represented to them to be correct by any
officer of the Trust having charge of its books of account, or stated in a
written report by an independent certified public accountant fairly to present
the financial position of the Trust. The Trustees and officers may rely, and
shall be personally protected in acting, upon any instrument or other document
believed by them to be genuine.
Section 4.9. Surety Bonds. No Trustee, officer, employee or agent of
the Trust shall, as such, be obligated to give any bond or surety or other
security for the performance of any of his duties, unless required by applicable
law or regulation, or unless the Trustees shall otherwise determine in any
particular case.
Section 4.10. Apparent Authority of Trustees and Officers. No
purchaser, lender, transfer agent or other Person dealing with the Trustees or
any officer of the Trust shall be bound to make any inquiry concerning the
validity of any transaction purporting to be made by the
14
Trustees or by such officer, or to make inquiry concerning or be liable for the
application of money or property paid, loaned or delivered to or on the order of
the Trustees or of such officer.
Section 4.11. Other Relationships Not Prohibited. The fact that:
(i) any of the Shareholders, Trustees or officers of
the Trust is a shareholder, director, officer, partner,
trustee, employee, manager, adviser, principal underwriter or
distributor or agent of or for any Contracting Party (as
defined in Section 5.2 hereof), or of or for any parent or
affiliate of any Contracting Party, or that the Contracting
Party or any parent or affiliate thereof is a Shareholder or
has an interest in the Trust or any Series, or that
(ii) any Contracting Party may have a contract
providing for the rendering of any similar services to one or
more other corporations, trusts, associations, partnerships,
limited partnerships or other organizations, or have other
business or interests, shall not affect the validity of any
contract for the performance and assumption of services,
duties and responsibilities to, for or of the Trust and/or the
Trustees or disqualify any Shareholder, Trustee or officer of
the Trust from voting upon or executing the same or create any
liability or accountability to the Trust or to the holders of
Shares of any Series; provided that, in the case of any
relationship or interest referred to in the preceding clause
(i) on the part of any Trustee or officer of the Trust, either
(x) the material facts as to such relationship or interest
have been disclosed to or are known by the Trustees not having
any such relationship or interest and the contract involved is
approved in good faith by a majority of such Trustees not
having any such relationship or interest (even though such
unrelated or disinterested Trustees are less than a quorum of
all of the Trustees), (y) the material facts as to such
relationship or interest and as to the contract have been
disclosed to or are known by the Shareholders entitled to vote
thereon and the contract involved is specifically approved in
good faith by vote of the Shareholders, or (z) the specific
contract involved is fair to the Trust as of the time it is
authorized, approved or ratified by the Trustees or by the
Shareholders.
Section 4.12. Payment of Trust Expenses. The Trustees are authorized to
pay or to cause to be paid out of the principal or income of the Trust, or
partly out of principal and partly out of income, and according to any
allocation to a particular Series and Class made by them pursuant to Section
6.1(f) hereof, all expenses, fees, charges, taxes and liabilities incurred or
arising in connection with the business and affairs of the Trust or in
connection with the management thereof, including, but not limited to, the
Trustees' compensation and such expenses and charges for the services of the
Trust's officers, employees, Investment Adviser, Administrator, Distributor,
Principal Underwriter, auditor, counsel, Custodian, Transfer Agent, Dividend
Disbursing Agent, Accounting Agent, Shareholder Servicing Agent, and such other
agents, consultants, and independent contractors and such other expenses and
charges as the Trustees may deem necessary or proper to incur.
Section 4.13. Ownership of the Trust Property. Legal title to all the
Trust Property shall be vested in the Trustees as joint tenants, except that the
Trustees shall have power to cause legal
15
title to any Trust Property to be held by or in the name of one or more of the
Trustees, or in the name of the Trust, or of any particular Series, or in the
name of any other Person as nominee, on such terms as the Trustees may
determine; provided that the interest of the Trust and of the respective Series
therein is appropriately protected. The right, title and interest of the
Trustees in the Trust Property shall vest automatically in each Person who may
hereafter become a Trustee. Upon the termination of the term of office of a
Trustee as provided in Section 4.1(c), (d) or (e) hereof, such Trustee 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.
Section 4.14. By-Laws. The Trustees may adopt and from time to time
amend or repeal By-Laws for the conduct of the business of the Trust.
ARTICLE 5
DELEGATION OF MANAGERIAL RESPONSIBILITIES
Section 5.1. Appointment; Action by Less than All Trustees. The
Trustees shall be responsible for the general operating policy of the Trust and
for the general supervision of the business of the Trust conducted by officers,
agents, employees or advisers of the Trust or by independent contractors, but
the Trustees shall not be required personally to conduct all the business of the
Trust and, consistent with their ultimate responsibility as stated herein, the
Trustees may appoint, employ or contract with one or more officers, employees
and agents to conduct, manage and/or supervise the operations of the Trust, and
may grant or delegate such authority to such officers, employees and/or agents
as the Trustees may, in their sole discretion, deem to be necessary or
desirable, without regard to whether such authority is normally granted or
delegated by trustees. With respect to those matters of the operation and
business of the Trust which they shall elect to conduct themselves, except as
otherwise provided by this Declaration or the By-Laws, if any, the Trustees may
authorize any single Trustee or defined group of Trustees, or any committee
consisting of a number of Trustees less than the whole number of Trustees then
in office without specification of the particular Trustees required to be
included therein, to act for and to bind the Trust, to the same extent as the
whole number of Trustees could do, either with respect to one or more particular
matters or classes of matters, or generally.
Section 5.2. Certain Contracts. Subject to compliance with the
provisions of the 1940 Act, but notwithstanding any limitations of present and
future law or custom in regard to delegation of powers by trustees generally,
the Trustees may, at any time and from time to time in their discretion and
without limiting the generality of their powers and authority otherwise set
forth herein, enter into one or more contracts with any one or more
corporations, trusts, associations, partnerships, limited partnerships, limited
liability companies or other types of organizations, or individuals
("Contracting Party"), to provide for the performance and assumption of some or
all of the following services, duties and responsibilities to, for or on behalf
of the Trust and/or any Series, and/or the Trustees, and to provide for the
performance and assumption of such other services, duties and responsibilities
in addition to those set forth below, as the Trustees may deem appropriate:
16
(a) Investment Advisory. An investment advisory or management
agreement whereby the agent shall undertake to furnish each Series of
the Trust such management, investment advisory or supervisory,
statistical and research facilities and services, and such other
facilities and services, if any, as the Trustees shall from time to
time consider desirable, all upon such terms and conditions as the
Trustees may in their discretion determine to be not inconsistent with
this Declaration, the applicable provisions of the 1940 Act or any
applicable provisions of the By-Laws (any such agent being herein
referred to as an "Investment Adviser"). To the extent required by the
1940 Act, any such advisory or management agreement and any amendment
thereto shall be subject to approval by a Majority Shareholder Vote at
a meeting of the Shareholders of the applicable Series of the Trust.
Notwithstanding any provisions of this Declaration, the Trustees may
authorize the 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 securities of the Trust on
behalf of the Trustees or may authorize any officer or employee of the
Trust or any Trustee to effect such purchases, sales, loans or
exchanges pursuant to recommendations of the Investment Adviser (and
all without further action by the Trustees). Any such purchases, sales,
loans and exchanges shall be deemed to have been authorized by all of
the Trustees. The Trustees may, in their sole discretion, call a
meeting of Shareholders in order to submit to a vote of Shareholders of
the applicable Series of Trust at such meeting the approval of or
continuance of any such investment advisory or management agreement.
(b) Administration. An agreement whereby the agent, subject to
the general supervision of the Trustees and in conformity with any
policies of the Trustees with respect to the operations of the Trust
and each Series, will supervise all or any part of the operations of
the Trust and each Series, and will provide all or any part of the
administrative and clerical personnel, office space and office
equipment and services appropriate for the efficient administration and
operations of the Trust and each Series (any such agent being herein
referred to as an "Administrator").
(c) Underwriting. An agreement providing for the sale of
Shares of any one or more Series to net the Trust not less than the net
asset value per Share (as described in Section 6.1(l) hereof) and
pursuant to which the Trust may appoint the other party to such
agreement as its principal underwriter or distributor for the
distribution of such Shares. The agreement shall contain such terms and
conditions as the Trustees may in their discretion determine to be not
inconsistent with this Declaration, the applicable provisions of the
1940 Act and any applicable provisions of the By-Laws (any such agent
being herein referred to as a "Distributor" or a "Principal
Underwriter," as the case may be).
(d) Custodian. The appointment of an agent meeting the
requirements for a custodian for the assets of investment companies
contained in the 1940 Act as custodian of the Securities, assets and
cash of the Trust and of each Series and of the accounting records in
connection therewith (any such agent being herein referred to as a
"Custodian").
17
(e) Transfer and Dividend Disbursing Agent. An agreement with
an agent to maintain records of the ownership of outstanding Shares,
the issuance and redemption and the transfer thereof (any such agent
being herein referred to as a "Transfer Agent"), and to disburse any
dividends declared by the Trustees and in accordance with the policies
of the Trust and/or the instructions of any particular Shareholder to
reinvest any such dividends (any such agent being herein referred to as
a "Dividend Disbursing Agent").
(f) Shareholder Servicing. An agreement with an agent to
provide service with respect to the relationship of the Trust and its
Shareholders, records with respect to Shareholders and their Shares,
and similar matters (any such agent being herein referred to as a
"Shareholder Servicing Agent").
(g) Accounting. An agreement with an agent to handle all or
any part of the accounting responsibilities, whether with respect to
the Trust's properties, Shareholders or otherwise (any such agent being
herein referred to as an "Accounting Agent").
In addition, the Trustees may from time to time cause the Trust or any
Series thereof to enter into agreements with respect to such other services and
upon such other terms and conditions as they may deem necessary, appropriate or
desirable. The same Person may be the Contracting Party for some or all of the
services, duties and responsibilities to, for and of the Trust and/or the
Trustees, and the contracts with respect thereto may contain such terms
interpretive of or in addition to the delineation of the services, duties and
responsibilities provided for, including provisions that are not inconsistent
with the 1940 Act relating to the standard of duty of and the rights to
indemnification of the Contracting Party and others, as the Trustees may
determine. Nothing herein shall preclude, prevent or limit the Trust or a
Contracting Party from entering into subcontractual arrangements relative to any
of the matters referred to in subsections (a) through (g) of this Section 5.2.
Section 5.3. Distribution Arrangements. Subject to compliance with the
1940 Act, the Trustees may adopt and amend or repeal from time to time and
implement one or more plans of distribution pursuant to Rule 12b-1 of the 1940
Act which plan(s) will provide for the payment of specified marketing,
distribution and shareholder relations expenses of the Trust and any or all
Series and their agents and the agents of such agents.
Section 5.4. Service Arrangements. Subject to compliance with the 1940
Act, the Trustees may adopt and amend or repeal from time to time and implement
one or more service plans which plans will provide for the payment to Persons
for providing ongoing services to holders of the shares of such Trust or any
Series thereof and in connection with the maintenance of such shareholders'
accounts.
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ARTICLE 6
SERIES AND SHARES
Section 6.1. Description of Series and Shares.
(a) General. The beneficial interest in the Trust shall be divided into
Shares having $ 0.01 par value per Share, of which an unlimited number may be
issued. The Trustees shall have the authority from time to time to establish and
designate one or more separate, distinct and independent Series of Shares (each
of which Series, including without limitation each Series authorized in Section
6.1(b) hereof, shall represent interests only in the assets attributed by the
Trustees to such Series), and to authorize separate Classes of Shares of any
such Series, as they deem necessary or desirable. The Trustees may, without
Shareholder approval, divide interests of any Series into two or more Classes.
(b) Establishment, etc. of Series; Authorization of Shares. The
establishment and designation of any Series or Class and the authorization of
the Shares thereof shall be effective upon the execution by a Majority of the
Trustees (or by an officer of the Trust pursuant to the vote of a Majority of
the Trustees) of an instrument setting forth such establishment and designation
and the relative rights and preferences of the Shares of such Series or Class
and the manner in which the same may be amended (a "Certificate of
Designation"), and may provide that the number of Shares of such Series or Class
which may be issued is unlimited, or may limit the number issuable. At any time
that there are no Shares outstanding of any particular Series or Class
previously established and designated, the Trustees may by an instrument
executed by a Majority of the Trustees (or by an officer of the Trust pursuant
to the vote of a Majority of the Trustees) terminate such Series or Class and
the establishment and designation thereof and the authorization of its Shares (a
"Certificate of Termination"). Each Certificate of Designation, Certificate of
Termination and any instrument amending a Certificate of Designation shall have
the status of an amendment to this Declaration of Trust.
(c) Character of Separate Series and Shares Thereof. Each Series
established hereunder shall represent beneficial interests in a separate
component of the assets of the Trust. Holders of Shares of a Series shall be
considered Shareholders of such Series, but such Shareholders shall also be
considered Shareholders of the Trust for purposes of receiving reports and
notices and, except as otherwise provided herein or in the Certificate of
Designation of a particular Series, or as required by the 1940 Act or other
applicable law, the right to vote, all without distinction by Series. The
Trustees shall have exclusive power without Shareholder approval to establish
and designate such separate and distinct Series, and to fix and determine the
relative rights and preferences as between the shares of the respective Series,
and as between the Classes of any Series, as to rights of redemption and the
price, terms and manner of redemption, special and relative rights as to
dividends and other distributions and on liquidation, sinking or purchase fund
provisions, conversion rights, and conditions under which the Shareholders of
the several Series or the several Classes of any Series of Shares shall have
separate voting rights or no voting rights. Except as otherwise provided as to a
particular Series
19
herein, or in the Certificate of Designation therefor, the Trustees shall have
all the rights and powers, and be subject to all the duties and obligations,
with respect to each such Series and the assets and affairs thereof as they have
under this Declaration with respect to the Trust and the Trust Property in
general. Separate and distinct records shall be maintained for each Series of
Shares and the assets and liabilities attributable thereto.
(d) Consideration for Shares. The Trustees may issue Shares of any
Series for such consideration (which may include property subject to, or
acquired in connection with the assumption of, liabilities) and on such terms as
they may determine (or for no consideration if pursuant to a Share dividend or
split-up), all without action or approval of the Shareholders. All Shares when
so issued on the terms determined by the Trustees shall be fully paid and
nonassessable (but may be subject to mandatory contribution back to the Trust as
provided in Section 6.1(l) hereof. The Trustees may classify or reclassify any
unissued Shares, or any Shares of any Series previously issued and reacquired by
the Trust, into Shares of one or more other Series that may be established and
designated from time to time.
(e) Assets Belonging to Series. Any portion of the Trust Property
allocated to a particular Series, and all consideration received by the Trust
for the issue or sale of Shares of such Series, together with all assets in
which such consideration is invested or reinvested, all interest, dividends,
income, earnings, profits and gains therefrom, and proceeds thereof, including
any proceeds derived from the sale, exchange or liquidation of such assets, and
any funds or payments derived from any reinvestment of such proceeds in whatever
form the same may be, shall be held by the Trustees in trust for the benefit of
the holders of Shares of that Series and shall irrevocably belong to that Series
for all purposes, and shall be so recorded upon the books of account of the
Trust, and the Shareholders of such Series shall not have, and shall be
conclusively deemed to have waived, any claims to the assets of any Series of
which they are not Shareholders. Such consideration, assets, interest,
dividends, income, earnings, profits, gains and proceeds, together with any
General Items allocated to that Series as provided in the following sentence,
are herein referred to collectively as assets "belonging to" that Series. In the
event that there are any assets, income, earnings, profits, and proceeds
thereof, funds, identifiable as belonging to any particular Series
(collectively, "General Items"), the Trustees shall allocate such General Items
to and among any one or more of the Series established and designated from time
to time in such manner and on such basis as they, in their sole discretion, deem
fair and equitable; and any General Items so allocated to a particular Series
shall belong to and be part of the assets belonging to that Series. Each such
allocation by the Trustees shall be conclusive and binding upon the Shareholders
of all Series for all purposes.
(f) Liabilities of Series. The assets belonging to each particular
Series shall be charged with the liabilities in respect of that Series and all
expenses, costs, charges and reserves attributable to that Series, and any
general liabilities, expenses, costs, charges or reserves of the Trust which are
not readily identifiable as pertaining to any particular Series shall be
allocated and charged by the Trustees to and among any one or more of the Series
established and designated from time to time in such manner and on such basis as
the Trustees in their sole discretion deem fair and equitable. The
20
indebtedness, expenses, costs, charges and reserves allocated and so charged to
a particular Series are herein referred to as "liabilities of" that Series. Each
allocation of liabilities, expenses, costs, charges and reserves by the Trustees
shall be conclusive and binding upon the Shareholders of all Series for all
purposes. Any creditor of any Series may look only to the assets belonging to
that Series to satisfy such creditor's debt.
(g) Dividends. Dividends and distributions on Shares of a particular
Series may be paid with such frequency as the Trustees may determine, which may
be daily or otherwise pursuant to a standing resolution or resolutions adopted
only once or with such frequency as the Trustees may determine, to the
Shareholders of that Series, from such of the income, accrued or realized, and
capital gains, realized or unrealized, and out of the assets belonging to that
Series, as the Trustees may determine, after providing for actual and accrued
liabilities of that Series. All dividends and distributions on Shares of a
particular Series shall be distributed pro rata to the Shareholders of that
Series in proportion to the number of such Shares held by such holders at the
date and time of record established for the payment of such dividends or
distributions, except that the dividends and distributions of investment income
and capital gains with respect to each Class of Shares of a particular Series
shall be in such amount as may be declared from time to time by the Trustees,
and such dividends and distributions may vary as between such Classes to reflect
differing allocations of the expenses of the Series between the Shareholders of
such several Classes and any resultant differences between the net asset value
of such several Classes to such extent and for such purposes as the Trustees may
deem appropriate and further except that, in connection with any dividend or
distribution program or procedure, the Trustees may determine that no dividend
or distribution shall be payable on Shares as to which the Shareholder's
purchase order and/or payment have not been received by the time or times
established by the Trustees under such program or procedure, or that dividends
or distributions shall be payable on Shares which have been tendered by the
holder thereof for redemption or repurchase, but the redemption or repurchase
proceeds of which have not yet been paid to such Shareholder. Such dividends and
distributions may be made in cash, property or Shares of any Class of that
Series or a combination thereof as determined by the Trustees, or pursuant to
any program that the Trustees may have in effect at the time for the election by
each Shareholder of the mode of the making of such dividend or distribution to
that Shareholder. Any such dividend or distribution paid in Shares will be paid
at the net asset value thereof as determined in accordance with subsection (l)
of this Section 6.1.
(h) Liquidation. In the event of the liquidation or dissolution of the
Trust or any Series or Class thereof, the Shareholders of each Series (or Class)
of which Shares are outstanding shall be entitled to receive, when and as
declared by the Trustees, the excess of the assets belonging to that Series (or
Class) over the liabilities of such Series (or Class). The assets so
distributable to the Shareholders of any particular Series (or Class) shall be
distributed among such Shareholders in proportion to the number of Shares of
that Series (or Class) held by them and recorded on the books of the Trust.
(i) Voting. The Shareholders shall have the voting rights set forth in
or determined under Article 7 hereof.
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(j) Redemption by Shareholder. Each holder of Shares of a particular
Series shall have the right at such times as may be permitted by the Trust, but
no less frequently than required by the 1940 Act, to require the Series to
redeem all or any part of his Shares of that Series at a redemption price equal
to the net asset value per Share of that Series next determined in accordance
with subsection (l) of this Section 6.1 after the Shares are properly tendered
for redemption; provided, that the Trustees may from time to time, in their
discretion, determine and impose a fee for such redemption and that the proceeds
of the redemption of Shares (including a fractional Share) of any Class of a
particular Series shall be reduced by the amount of any applicable contingent
deferred sales charge or other sales charge, if any, payable on such redemption
of Shares of such Class (to the extent consistent with the 1940 Act or
regulations or exemptions thereunder). 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 make payment wholly or partly in Securities
or other assets belonging to such Series at the value of such Securities or
assets used in such determination of net asset value. Notwithstanding the
foregoing, the Trust may postpone payment of the redemption price and may
suspend the right of the holders of Shares of any Series to require the Trust to
redeem Shares of that Series during any period or at any time when and to the
extent permissible under the 1940 Act.
(k) Redemption at the Option of the Trust. Each Share 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 Share was then being redeemed by the holder pursuant to Section 6.1(j)
hereof: (a) at any time, if the Trustees determine in their sole discretion and
by vote of a Majority of the Trustees that it is in the best interest of the
Trust, or any Series or Class thereof, to so redeem; or (b) upon such other
conditions as may from time to time be determined by the Trustees and set forth
in the current Prospectus of the Trust with respect to maintenance of
Shareholder accounts of a minimum or maximum amount or percentage. Upon such
redemption the holders of the Shares so redeemed shall have no further right
with respect thereto other than to receive payment of such redemption price.
(l) Net Asset Value. The net asset value per Share of any Series at any
time shall be the quotient obtained by dividing the value of the net assets of
such Series at such time (being the current value of the assets belonging to
such Series, less its then existing liabilities) by the total number of Shares
of that Series then outstanding. The net asset value of the several Classes of a
particular Series shall be separately computed, and may vary from one another.
The Trustees shall establish procedures for the allocation of investment income
or capital gains and expenses and liabilities of a particular Series between the
several Classes of such Series. The Trustees may determine to maintain the net
asset value per Share of any Series at a designated constant dollar amount and
in connection therewith may adopt procedures not inconsistent with the 1940 Act
for the continuing declaration of income attributable to that Series as
dividends payable in additional Shares of that Series at the designated constant
dollar amount and for the handling of any losses attributable to that Series.
Such procedures may provide that in the event of any loss each Shareholder shall
be deemed to have contributed to the shares of beneficial interest account of
that Series his pro rata portion of the total number of
22
Shares required to be canceled in order to permit the net asset value per Share
of that Series to be maintained, after reflecting such loss, at the designated
constant dollar amount. Each Shareholder of the Trust shall be deemed to have
expressly agreed, by his investment in any Series with respect to which the
Trustees shall have adopted any such procedure, to make the contribution
referred to in the preceding sentence in the event of any such loss.
(m) Transfer. All Shares of each particular Series shall be
transferable, but transfers of Shares of a particular Series will be recorded on
the Share transfer records of the Trust applicable to that Series only at such
times as Shareholders shall have the right to require the Trust to redeem Shares
of that Series and at such other times as may be permitted by the Trustees.
(n) Equality. All Shares of each particular Series shall represent an
equal proportionate interest in the assets belonging to that Series (subject to
the liabilities of that Series), and each Share of any particular Series shall
be equal to each other Share thereof; but the provisions of this sentence shall
not restrict any distinctions between the several Classes of a Series
permissible under this Section 6.1 or under Section 7.1 hereof nor any
distinctions permissible under subsection (g) of this Section 6.1 that may exist
with respect to dividends and distributions on Shares of the same Series. The
Trustees may from time to time divide or combine the Shares of any class of
particular Series into a greater or lesser number of Shares of that class of a
Series without thereby changing the proportionate beneficial interest in the
assets belonging to that Series or in any way affecting the rights of the
holders of Shares of any other Series.
(o) Rights of Fractional Shares. Any fractional Share of any Series
shall carry proportionately all the rights and obligations of a whole Share of
that Series, including rights and obligations with respect to voting, receipt of
dividends and distributions, redemption of Shares, and liquidation of the Trust
or of the Series to which they pertain.
(p) Conversion Rights.
(i) Subject to compliance with the requirements of the 1940
Act, the Trustees shall have the authority to provide that holders of
Shares of any Series shall have the right to convert said Shares into
Shares of one or more other Series, that holders of any Class of a
Series of Shares shall have the right to convert said Shares of such
Class into Shares of one or more other Classes of such Series, and that
Shares of any Class of a Series shall be automatically converted into
Shares of another Class of such Series, in each case in accordance with
such requirements and procedures as the Trustees may establish.
(ii) The number of Shares into which a convertible Share shall
convert shall equal the number (including for this purpose fractions of
a Share) obtained by dividing the net asset value per Share for
purposes of sales and redemptions of the converting Share on the
Conversion Date by the net asset value per Share for purposes of sales
and redemptions of the Class of Shares into which it is converting on
the Conversion Date.
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(iii) On the Conversion Date, the Share converting into
another share will cease to accrue dividends and will no longer be
deemed outstanding and the rights of the holders thereof (except the
right to receive the number of target Shares into which the converting
Shares have been converted and declared but unpaid dividends to the
Conversion Date) will cease. Certificates representing Shares resulting
from the conversion need not be issued until certificates representing
Shares converted, if issued, have been received by the Trust or its
agent duly endorsed for transfer.
(iv) The Trust will appropriately reflect the conversion of
Shares of one Class of a Series into Shares of another Class of such
Series on the first periodic statements of account sent to Shareholders
of record affected which provide account information with respect to a
reporting period which includes the date such conversion occurred.
Section 6.2. Ownership of Shares. The ownership of Shares shall be
recorded on the books of the Trust or of a Transfer Agent or similar agent for
the Trust, which books shall be maintained separately for the Shares of each
Series that has been authorized. Certificates evidencing the ownership of Shares
need not be issued except as the Trustees may otherwise determine from time to
time, and the Trustees shall have power to call outstanding Share certificates
and to replace them with book entries. The Trustees may make such rules as they
consider appropriate for the issuance of Share certificates, the use of
facsimile signatures, the transfer of Shares and similar matters. The record
books of the Trust as kept by the Trust or any Transfer Agent or similar agent,
as the case may be, shall be conclusive as to who are the Shareholders and as to
the number of Shares of each Series held from time to time by each such
Shareholder.
The holders of Shares of each Series shall upon demand disclose to the
Trustees in writing such information with respect to their direct and indirect
ownership of Shares of such Series as the Trustees deem necessary to comply with
the provisions of the Internal Revenue Code, or to comply with the requirements
of any other authority.
Section 6.3. Investments in the Trust. The Trustees may accept
investments in any Series of the Trust from such Persons and on such terms and
for such consideration, not inconsistent with the provisions of the 1940 Act, as
they from time to time authorize. The Trustees may authorize any Distributor,
Principal Underwriter, Custodian, Transfer Agent or other Person to accept
orders for the purchase of Shares that conform to such authorized terms and to
reject any purchase orders for Shares, whether or not conforming to such
authorized terms.
Section 6.4. No Preemptive Rights. No Shareholder, by virtue of holding
Shares of any Series, shall have any preemptive or other right to subscribe to
any additional Shares of that Series, or to any shares of any other Series, or
any other Securities issued by the Trust.
Section 6.5. Status of Shares. Every Shareholder, by virtue of having
become a Shareholder, shall be held to have expressly assented and agreed to the
terms hereof and to have become a party hereto. Shares shall be deemed to be
personal property, giving only the rights
24
provided herein. Ownership of Shares shall not entitle the Shareholder to any
title in or to the whole or any part of the Trust Property or right to call for
a partition or division of the same or for an accounting, nor shall the
ownership of Shares constitute the Shareholders partners. The death of a
Shareholder during the continuance of the Trust shall not operate to terminate
the Trust or any Series, nor entitle the representative of any deceased
Shareholder to an accounting or to take any action in court or elsewhere against
the Trust or the Trustees, but only to the rights of said decedent as a
Shareholder under this Declaration of Trust.
ARTICLE 7
SHAREHOLDERS' VOTING POWERS AND MEETINGS
Section 7.1. Voting Powers. The Shareholders shall have power to vote only (i)
for the election or removal of Trustees as provided in Sections 4.1(c) and (e)
hereof, (ii) with respect to the approval or termination in accordance with the
1940 Act of any contract with a Contracting Party as provided in Section 5.2
hereof as to which Shareholder approval is required by the 1940 Act, (iii) with
respect to any reorganization of the Trust or any Series to the extent and as
provided in Sections 9.3 and 9.4 hereof, (iv) with respect to any amendment of
this Declaration of Trust to the extent and as provided in Section 9.5 hereof,
(v) to the same extent as the stockholders of a Delaware business corporation as
to whether or not a court action, proceeding or claim should or should not be
brought or maintained derivatively or as a class action on behalf of the Trust
or any Series, or the Shareholders of any of them (provided. however, that a
Shareholder of a particular Series shall not in any event be entitled to
maintain a derivative or class action on behalf of any other Series or the
Shareholders thereof), and (vi) with respect to such additional matters relating
to the Trust as may be required by the 1940 Act, this Declaration of Trust, the
By-Laws or any registration of the Trust with the Commission (or any successor
agency) or any State, or as the Trustees may consider necessary or desirable. If
and to the extent that the Trustees shall determine that such action is required
by law or by this Declaration, they shall cause each matter required or
permitted to be voted upon at a meeting or by written consent of Shareholders to
be submitted to a separate vote of the outstanding Shares of each Series
entitled to vote thereon; provided, that (i) when expressly required by the 1940
Act or by other law, actions of Shareholders shall be taken by Single Class
Voting of all outstanding Shares whose holders are entitled to vote thereon; and
(ii) when the Trustees determine that any matter to be submitted to a vote of
Shareholders affects only the rights or interests of Shareholders of one or more
but not all Series or of one or more but not all Classes of a single Series
(including without limitation any distribution plan pursuant to Rule 12b-1 of
the 1940 Act applicable to such Class), then only the Shareholders of the Series
or Classes so affected shall be entitled to vote thereon. Any matter required to
be submitted to shareholders and affecting one or more Series shall require
separate approval by the required vote of Shareholders of each affected Series;
provided, however, that to the extent required by the 1940 Act, there shall be
no separate Series votes on the election or removal of Trustees, the selection
of auditors for the Trust and its Series or approval of any agreement or
contract entered into by the Trust or any Series. Shareholders of a particular
Series shall not be entitled to vote on any matter that affects only one or more
other Series.
Section 7.2. Number of Votes and Manner of Voting; Proxies. On each
matter submitted to a vote of the Shareholders, each holder of Shares of any
Series shall be entitled to a
25
number of votes equal to the number of Shares of such Series standing in his
name on the books of the Trust. There shall be no cumulative voting in the
election or removal of Trustees. Shares may be voted in person or by proxy. A
proxy with respect to Shares held in the name of two (2) or more Persons shall
be valid if executed by any one of them unless at or prior to exercise of the
proxy the Trust receives a specific written notice to the contrary from any one
of them. A proxy purporting to be executed by or on behalf of a Shareholder
shall be deemed valid unless challenged at or prior to its exercise and the
burden of proving invalidity shall rest on the challenger. Until Shares are
issued, the Trustees may exercise all rights of Shareholders and may take any
action required by law, this Declaration of Trust or the By-Laws to be taken by
Shareholders.
Section 7.3. Meetings. Meetings of Shareholders may be called by the
Trustees from time to time for the purpose of taking action upon any matter
requiring the vote or authority of the Shareholders as herein provided, or upon
any other matter deemed by the Trustees to be necessary or desirable. Written
notice of any meeting of Shareholders shall be given or caused to be given by
the Trustees by mailing such notice at least seven (7) days before such meeting,
postage prepaid, stating the time, place and purpose of the meeting, to each
Shareholder at the Shareholder's address as it appears on the records of the
Trust. The Trustees shall promptly call and give notice of a meeting of
Shareholders for the purpose of voting upon removal of any Trustee of the Trust
when requested to do so in writing by Shareholders holding not less than ten
percent (10%) of the Shares then outstanding. If the Trustees shall fail to call
or give notice of any meeting of Shareholders for a period of thirty (30) days
after written application by Shareholders holding at least ten percent (10%) of
the Shares then outstanding requesting that a meeting be called for any other
purpose requiring action by the Shareholders as provided herein or in the
By-Laws, then Shareholders holding at least ten percent (10%) of the Shares then
outstanding may call and give notice of such meeting, and thereupon the meeting
shall be held in the manner provided for herein in case of call thereof by the
Trustees. Any meetings may be held within or without the state of Delaware.
Shareholders may only act with respect to matters set forth in the notice to
Shareholders.
Section 7.4. Record Dates. For the purpose of determining the
Shareholders who are entitled to vote or act at any meeting or any adjournment
thereof, or who are entitled to participate in any dividend or distribution, or
for the purpose of any other action, the Trustees may from time to time close
the transfer books for such period, not exceeding thirty (30) days (except at or
in connection with the termination of the Trust), as the Trustees may determine;
or without closing the transfer books the Trustees may fix a date and time not
more than ninety (90) days prior to the date of any meeting of Shareholders or
other action as the date and time of record for the determination of
Shareholders entitled to vote at such meeting or any adjournment thereof or to
be treated as Shareholders of record for purposes of such other action, and any
Shareholder who was a Shareholder at the date and time so fixed shall be
entitled to vote at such meeting or any adjournment thereof or to be treated as
a Shareholder of record for purposes of such other action, even though he has
since that date and time disposed of his Shares, and no Shareholder becoming
such after that date and time shall be so entitled to vote at such meeting or
any adjournment thereof or to be treated as a Shareholder of record for purposes
of such other action.
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Section 7.5. Quorum and Required Vote. The presence in person or by
proxy of one-third of the holders of Shares entitled to vote shall be a quorum
for the transaction of business at a Shareholders' meeting, but any lesser
number shall be sufficient for adjournments. Any adjourned session or sessions
may be held within a reasonable time after the date set for the original meeting
without the necessity of further notice. A Majority Shareholder Vote at a
meeting of which a quorum is present shall decide any question, except when a
different vote is required or permitted by any provision of the 1940 Act or
other applicable law or by this Declaration of Trust or the By-Laws, or when the
Trustees shall in their discretion require a larger vote or the vote of a
majority or larger fraction of the Shares of one or more particular Series.
Section 7.6. Action By Written Consent. Subject to the provisions of
the 1940 Act and other applicable law, any action taken by Shareholders may be
taken without a meeting if a majority of Shareholders entitled to vote on the
matter (or such larger proportion thereof or of the Shares of any particular
Series as shall be required by the 1940 Act or by any express provision of this
Declaration of Trust or the By-Laws or as shall be permitted by the Trustees)
consent to the action in writing and if the writings in which such consent is
given are filed with the records of the meetings of Shareholders, to the same
extent and for the same period as proxies given in connection with a
Shareholders' meeting. Such consent shall be treated for all purposes as a vote
taken at a meeting of Shareholders.
Section 7.7. Inspection of Records. The records of the Trust shall be
open to inspection by Shareholders to the same extent as is permitted
stockholders of a Delaware business corporation under the Delaware business
corporation law.
Section 7.8. Additional Provisions. The By-Laws may include further
provisions for Shareholders' votes and meetings and related matters not
inconsistent with the provisions hereof.
ARTICLE 8
LIMITATION OF LIABILITY; INDEMNIFICATION
Section 8.1. Trustees, Shareholders, etc. The Trustees, officers,
employees and agents of the Trust, in incurring any debts, liabilities or
obligations, or in limiting or omitting any other actions for or in connection
with the Trust, are or shall be deemed to be acting as Trustees, officers,
employees or agents of the Trust and not in their own capacities. No Shareholder
shall be subject to any personal liability whatsoever in tort, contract or
otherwise to any other Person or Persons in connection with the assets or the
affairs of the Trust or of any Series, and subject to Section 8.4 hereof, no
Trustee, officer, employee or agent of the Trust shall be subject to any
personal liability whatsoever in tort, contract, or otherwise, to any other
Person or Persons in connection with the assets or affairs of the Trust or of
any Series, save only that arising from his own willful misfeasance, bad faith,
gross negligence or reckless disregard of the duties involved in the conduct of
his office or the discharge of his functions. The Trust (or if the matter
relates only to a particular Series, that Series) shall be solely liable for any
and all debts, claims, demands, judgments, decrees, liabilities or obligations
of any and every kind, against or with respect to the Trust or such Series in
tort, contract or otherwise in connection with the assets or the affairs of the
Trust or such Series, and all Persons dealing with the Trust or any Series shall
27
be deemed to have agreed that resort shall be had solely to the Trust Property
of the Trust or the assets of such Series, as the case may be, for the payment
or performance thereof.
The Trustees shall use their best efforts to ensure that every note,
bond, contract, instrument, certificate or undertaking made or issued by the
Trustees or by any officers or officer shall give notice that a Certificate of
Trust, referring to the Declaration of Trust, is on file with the Secretary of
the state of Delaware and shall recite to the effect that the same was executed
or made by or on behalf of the Trust or by them as Trustees or Trustee or as
officers or officer, and not individually, and that the obligations of such
instrument are not binding upon any of them or the Shareholders individually but
are binding only upon the assets and property of the Trust, or the particular
Series in question, as the case may be, but the omission thereof shall not
operate to bind any Trustees or Trustee or officers or officer or Shareholders
or Shareholder individually, or to subject the assets of any Series to the
obligations of any other Series.
Section 8.2. Trustees' Good Faith Action; Expert Advice; No Bond or
Surety. The exercise by the Trustees of their powers and discretions hereunder
shall be binding upon everyone interested. Subject to Section 8.4 hereof, a
Trustee shall be liable for his own willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of the
office of Trustee, and for nothing else, and shall not be liable for errors of
judgment or mistakes of fact or law. Subject to the foregoing, (i) the Trustees
shall not be responsible or liable in any event for any neglect or wrongdoing of
any officer, agent, employee, consultant, Investment Adviser, Administrator,
Distributor or Principal Underwriter, Custodian or Transfer Agent, Dividend
Disbursing Agent, Shareholder Servicing Agent or Accounting Agent of the Trust,
nor shall any Trustee be responsible for the act or omission of any other
Trustee; (ii) the Trustees may take advice of counsel or other experts with
respect to the meaning and operation of this Declaration of Trust and their
duties as Trustees, and shall be under no liability for any act or omission in
accordance with such advice or for failing to follow such advice; and (iii) in
discharging their duties, the Trustees, when acting in good faith, shall be
entitled to rely upon the books of account of the Trust and upon written reports
made to the Trustees by any officer appointed by them, any independent public
accountant, and (with respect to the subject matter of the contract involved)
any officer, partner or responsible employee of a Contracting Party appointed by
the Trustees pursuant to Section 5.2 hereof. The Trustees as such shall not be
required to give any bond or surety or any other security for the performance of
their duties.
Section 8.3. Indemnification of Shareholders. If any Shareholder (or
former Shareholder) of the Trust shall be charged or held to be personally
liable for any obligation or liability of the Trust solely by reason of being or
having been a Shareholder and not because of such Shareholder's acts or
omissions or for some other reason, the Trust (upon proper and timely request by
the Shareholder) may assume the defense against such charge and satisfy any
judgment thereon or may reimburse the Shareholders for expenses, and the
Shareholder or former Shareholder (or the heirs, executors, administrators or
other legal representatives thereof, or in the case of a corporation or other
entity, its corporate or other general successor) shall be entitled (but solely
out of the assets of the Series of which such Shareholder or former Shareholder
is or was the holder of Shares) to be held harmless from and indemnified against
all loss and expense arising from such liability.
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Section 8.4. Indemnification of Trustees, Officers, etc. Subject to the
limitations, if applicable, hereinafter set forth in this Section 8.4, the Trust
shall indemnify (from the assets of the Series or Series to which the conduct in
question relates) each of its Trustees, officers, employees and agents
(including Persons who serve at the Trust's request as directors, officers or
trustees of another organization in which the Trust has any interest as a
shareholder, creditor or otherwise (hereinafter, together with such Person's
heirs, executors, administrators or personal representative, referred to as a
"Covered Person")) against all liabilities, including but not limited to amounts
paid in satisfaction of judgments, in compromise or as fines and penalties, and
expenses, including reasonable accountants' and counsel fees, incurred by any
Covered Person in connection with the defense or disposition of any action, suit
or other proceeding, whether civil or criminal, before any court or
administrative or legislative body, in which such Covered Person may be or may
have been involved as a party or otherwise or with which such Covered Person may
be or may have been threatened, while in office or thereafter, by reason of
being or having been such a Trustee or officer, director or trustee, except with
respect to any matter as to which it has been determined that such Covered
Person (i) did not act in good faith in the reasonable belief that such Covered
Person's action was in or not opposed to the best interests of the Trust; (ii)
had acted with willful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of such Covered Person's office
(iii) for a criminal proceeding, had reasonable cause to believe that his
conduct was unlawful (the conduct described in (i), (ii) and (iii) being
referred to hereafter as "Disabling Conduct"). A determination that the Covered
Person is entitled to indemnification may be made by (i) a final decision on the
merits by a court or other body before whom the proceeding was brought that the
Covered Person to be indemnified was not liable by reason of Disabling Conduct,
(ii) dismissal of a court action or an administrative proceeding against a
Covered Person for insufficiency of evidence of Disabling Conduct, or (iii) a
reasonable determination, based upon a review of the facts, that the indemnity
was not liable by reason of Disabling Conduct by (a) a vote of a majority of a
quorum of Trustees who are neither "interested persons" of the Trust as defined
in Section 2(a)(19) of the 1940 Act nor parties to the proceeding (the
"Disinterested Trustees"), or (b) an independent legal counsel in a written
opinion. Expenses, including accountants' and counsel fees so incurred by any
such Covered Person (but excluding amounts paid in satisfaction of judgments, in
compromise or as fines or penalties), may be paid from time to time by one or
more Series to which the conduct in question related in advance of the final
disposition of any such action, suit or proceeding; provided that the Covered
Person shall have undertaken to repay the amounts so paid to such Series if it
is ultimately determined that indemnification of such expenses is not authorized
under this Article 8 and (i) the Covered Person shall have provided security for
such undertaking, (ii) the Trust shall be insured against losses arising by
reason of any lawful advances, or (iii) a majority of a quorum of the
disinterested Trustees, or an independent legal counsel in a written opinion,
shall have determined, based on a review of readily available facts (as opposed
to a full trial type inquiry), that there is reason to believe that the Covered
Person ultimately will be found entitled to indemnification.
Section 8.5. Compromise Payment. As to any matter disposed of by a
compromise payment by any such Covered Person referred to in Section 8.4 hereof,
pursuant to a consent decree or otherwise, no such indemnification either for
said payment or for any other expenses shall be provided unless such
indemnification shall be approved (i) by a majority of a quorum of the
disinterested Trustees or (ii) by an independent legal counsel in a written
opinion. Approval by the Trustees pursuant to clause (i) or by independent legal
counsel pursuant to clause (ii) shall
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not prevent the recovery from any Covered Person of any amount paid to such
Covered Person in accordance with either of such clauses as indemnification if
such Covered Person is subsequently adjudicated by a court of competent
jurisdiction not to have acted in good faith in the reasonable belief that such
Covered Person's action was in or not opposed to the best interests of the Trust
or to have been liable to the Trust or its Shareholders by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of the Covered Person's office.
Section 8.6. Indemnification Not Exclusive, etc. The right of
indemnification provided by this Article 8 shall not be exclusive of or affect
any other rights to which any such Covered Person or shareholder may be
entitled. As used in this Article 8, a "disinterested" Person is one against
whom none of the actions, suits or other proceedings in question, and no other
action, suit or other proceeding on the same or similar grounds is then or has
been pending or threatened. Nothing contained in this Article 8 shall affect any
rights to indemnification to which personnel of the Trust, other than Trustees
and officers, and other Persons may be entitled by contract or otherwise under
law, nor the power of the Trust to purchase and maintain liability insurance on
behalf of any such Person.
Section 8.7. Liability of Third Persons Dealing with Trustees. No
person dealing with the Trustees shall be bound to make any inquiry concerning
the validity of any transaction made or to be made by the Trustees or to see to
the application of any payments made or property transferred to the Trust or
upon its order.
ARTICLE 9
DURATION; REORGANIZATION; INCORPORATION; AMENDMENTS
Section 9.1. Duration of Trust. Unless terminated as provided herein,
the Trust shall have perpetual existence.
Section 9.2. Termination of Trust. The Trust may be terminated at any
time by a vote of a Majority of the Trustees by written notice to the
Shareholders. Upon termination, after paying or otherwise providing for all
charges, taxes, expenses and liabilities, whether due or accrued or anticipated
as may be determined by the Trustees, the Trust shall in accordance with such
procedures as the Trustees consider appropriate reduce the remaining assets to
distributable form in cash, Securities or other property, or any combination
thereof, and distribute the proceeds to the Shareholders, in conformity with the
provisions of Section 6.1(h) hereof. After termination of the Trust or any
Series or Class 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. 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. Upon termination of any Series or Class, the
Trustees shall thereupon be discharged from all further liabilities and duties
with respect to such Series or Class, and the rights and interests of all
Shareholders of such Series or Class shall thereupon cease.
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Section 9.3. Reorganization. The Trustees may sell, convey and transfer
all or substantially all of the assets of the Trust, or the assets belonging to
any one or more Series, to another trust, partnership, association, corporation
or other entity organized under the laws of any state of the United States, or
may transfer such assets to another Series of the Trust, in exchange for cash,
Shares or other Securities (including, in the case of a transfer to another
Series of the Trust, Shares of such other Series), or to the extent permitted by
law then in effect may merge or consolidate the Trust or any Series with any
other Trust or any corporation, partnership, or association organized under the
laws of any state of the United States, all upon such terms and conditions and
for such consideration when and as authorized by vote or written consent of a
Majority of the Trustees and approved by the affirmative vote of the holders of
not less than a majority of the Shares outstanding and entitled to vote of each
Series whose assets are affected by such transaction, or by an instrument or
instruments in writing without a meeting, consented to by the holders of not
less than a majority of such Shares, and/or by such other vote of any Series as
may be established by the Certificate of Designation with respect to such
Series. Following such transfer, the Trustees shall distribute the cash, Shares
or other Securities or other consideration received in such transaction (giving
due effect to the assets belonging to and indebtedness of, and any other
differences among, the various Series of which the assets have so been
transferred) among the Shareholders of the Series of which the assets have been
so transferred; and if all of the assets of the Trust have been so transferred,
the Trust shall be terminated. Nothing in this Section 9.3 shall be construed as
requiring approval of Shareholders for the Trustees to organize or assist in
organizing one or more corporations, trusts, partnerships, associations or other
organizations, and to sell, convey or transfer less than substantially all of
the Trust Property or the assets belonging to any Series to such organizations
or entities.
Section 9.4. Incorporation. Upon approval by Majority Shareholder 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 shares or
securities thereof, or otherwise, and to lend money to, subscribe for the shares
of securities of, and enter into any contracts with any such corporation, trust,
partnership, association or organization in which the Trust holds or is about to
acquire shares or any other interests. The Trustees may also cause a merger or
consolidation between the Trust or any successor thereto and any such
corporation, trust, partnership, association or other organization if and to the
extent permitted by law, as provided under the law then in effect. Nothing
contained herein shall be construed as requiring approval of Shareholders for
the Trustees to organize or assist in organizing one or more corporation,
trusts, partnerships, associations or other organizations and selling, conveying
or transferring a portion of the Trust Property to such organizations or
entities.
Section 9.5. Amendments, etc. All rights granted to the Shareholders
under this Declaration of Trust are granted subject to the reservation of the
right to amend this Declaration of Trust as herein provided, except that no
amendment shall repeal the limitations on personal liability of any Shareholder
or Trustee or the prohibition of assessment upon the Shareholders (otherwise
than as permitted under Section 6.1(l)) without the express consent of each
Shareholder or Trustee involved. Subject to the foregoing, the provisions of
this Declaration of Trust (whether or not related to the rights of Shareholders)
may be amended at any time, so long
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as such amendment does not adversely affect the rights of any Shareholder with
respect to which such amendment is or purports to be applicable and 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 Trustees (or by an
officer of the Trust pursuant to the vote of a Majority of the Trustees). Any
amendment to this Declaration of Trust that adversely affects the rights of all
Shareholders may be adopted at any time by an instrument in writing signed by a
Majority of the Trustees (or by an officer of the Trust pursuant to a vote of a
Majority of the Trustees) when authorized to do so by the vote in accordance
with Section 7.1 hereof of Shareholders holding a majority of all the Shares
outstanding and entitled to vote, without regard to Series, or if said amendment
adversely affects the rights of the Shareholders of less than all of the Series,
by the vote of the holders of a majority of all the Shares entitled to vote of
each Series so affected.
Section 9.6. Filing of Copies of Declaration and Amendments. The
original or a copy of this Declaration and of each amendment hereto (including
each Certificate of Designation and Certificate of Termination) shall be kept at
the office of the Trust where it may be inspected by any Shareholder. A restated
Declaration, integrating into a single instrument all of the provisions of this
Declaration which are then in effect and operative, may be executed from time to
time by a Majority of the Trustees and shall, upon execution, be conclusive
evidence of all amendments contained therein and may thereafter be referred to
in lieu of the original Declaration and the various amendments thereto. A
Certificate of Trust shall be filed in the office of the Secretary of State of
the State of Delaware.
ARTICLE 10
MISCELLANEOUS
Section 10.1. Notices. Any and all notices to which any Shareholder
hereunder may be entitled and any and all communications shall be deemed duly
served or given if mailed, postage prepaid, addressed to any Shareholder of
record at his last known address as recorded on the applicable register of the
Trust.
Section 10.2. Governing Law. This Declaration of Trust is, with
reference to the laws thereof, and the rights of all parties and the
construction and effect of every provision hereof shall be, subject to and
construed according to the laws of said The State of Delaware.
Section 10.3. Counterparts. This Declaration of Trust and any amendment
thereto may be simultaneously executed in several counterparts, each of which so
executed shall be deemed to be an original, and such counterparts, together,
shall constitute but one and the same instrument, which shall be sufficiently
evidenced by any such original counterpart.
Section 10.4. Reliance by Third Parties. Any certificate executed by an
individual who, according to the records of the Trust is a Trustee hereunder,
certifying to: (a) the number or identity of Trustees or Shareholders, (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 Shareholders, (d) the fact that the
number of Trustees or Shareholders present at any meeting or executing any
written instrument satisfies the requirements of this Declaration of Trust, (e)
the form of any By-Law adopted, or the identity of any officers elected, by the
Trustees, (f) the existence or nonexistence
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of any fact or facts which in any manner relate to the affairs of the Trust, or
(g) the name of the Trust or the establishment of a Series shall be conclusive
evidence as to the matters so certified in favor of any Person dealing with the
Trustees, or any of them, and the successors of such Person.
Section 10.5. References; Headings. The masculine gender shall include
the feminine and neuter genders. Headings are placed herein for convenience of
reference only and shall not be taken as a part of this Declaration or control
or affect the meaning, construction or effect hereof.
Section 10.6. Provisions in Conflict With Law or Regulation.
(a) The provisions of this Declaration are severable, and if
the Trustees shall determine, with the advice of counsel, that any of
such provisions is in conflict with the 1940 Act, the regulated
investment company provisions of the Internal Revenue Code of 1986 or
with other applicable laws and regulations, the conflicting provision
shall be deemed never to have constituted a part of this Declaration;
provided, however, that such determination shall not affect any of the
remaining provisions of this Declaration or render invalid or improper
any action taken or omitted prior to such determination.
(b) If any provision of this Declaration shall be held invalid
or unenforceable in any jurisdiction, such invalidity or
unenforceability shall attach only to such provision in such
jurisdiction and shall not in any manner affect such provision in any
other jurisdiction or any other provision of this Declaration in any
jurisdiction.
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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.
/s/ Xxxxxxxx Xxxxxxx
____________________________________
Xxxxxxxx Xxxxxxx
Trustee
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