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AGREEMENT AND DECLARATION OF TRUST OF
PATRIOT PREMIUM DIVIDEND FUND II
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Dated: September 26, 1989
AGREEMENT AND DECLARATION OF
TRUST OF PATRIOT PREMIUM DIVIDEND FUND II
This AGREEMENT AND DECLARATION OF TRUST, made at Boston, Massachusetts
this 26th day of September, 1989, by and between ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, an individual
residing in Boston, Massachusetts (the "SETTLOR"), and the Trustee whose
signature is set forth below (the "INITIAL TRUSTEE"),
W I T N E S S E T H T H A T:
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WHEREAS, the Settlor proposes to deliver to the Initial Trustee the sum
of one hundred dollars ($100.00) lawful money of the United States of America in
trust hereunder and to authorize the Initial Trustee and all other individuals
acting as Trustees hereunder to employ such funds, and any other funds coming
into their hands or the hands of their successors or successor as such Trustees,
to carry on the business of an investment company and as such of buying,
selling, investing or otherwise dealing in and with stocks, bonds, debentures,
warrants and other securities and interests therein, financial futures
contracts, or options with respect to securities or financial futures contracts,
and such other and further investment media and other property as the Trustees
may deem advisable, which are not prohibited by law or the terms of this
Declaration; and
WHEREAS, the Initial Trustee is willing to accept such sum, together
with any and all additions thereto and the income or increments thereon, upon
the terms, conditions and trusts hereinafter set forth; and
WHEREAS, the beneficial interest in the assets held by the Trustees
shall be divided into transferable Shares, all in accordance with the provisions
hereinafter set forth; and
WHEREAS, it is desired that the trust established hereby be managed and
operated as a trust with transferable shares under the laws of Massachusetts, of
the type commonly known as a Massachusetts business trust, in accordance with
the provisions hereinafter set forth;
NOW, THEREFORE, the Initial Trustee, for himself and his successors as
Trustees, hereby declares, and agrees with the Settlor, for himself and for all
persons who shall hereafter become holders of ▇▇▇▇▇▇, that the Trustees will
hold the sum delivered to them upon the execution hereof, and all, other and
further cash, securities and other property of every type and description which
they may in any way acquire in their capacity as such Trustees, together with
the income therefrom and the proceeds thereof, IN TRUST NEVERTHELESS, to manage
and dispose of the same for the benefit of the holders from time to time of the
Shares being issued and to be issued hereunder and in the manner and subject to
the provisions hereof, to wit:
ARTICLE I
THE TRUST
Section 1.1. NAME; USE OF NAME.
(a) TRUST NAME. The name of the Trust shall be "Patriot Premium
Dividend Fund II", and so far as may be practicable the Trustees shall conduct
the Trust's activities, execute all documents and sue or be sued under that
name, which name (and the word "Trust" wherever used in this 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 Shareholders. If the Trustees determine that the use of such name is not
practicable, legal or convenient at any time or in any jurisdiction, or if the
Trust is required to discontinue the use of such name, then the Trustees may use
such other designation or adopt such other name for the Trust as they deem
proper, and the Trust may hold property and conduct its activities under such
other designation or name.
(b) USE OF THE NAME "PATRIOT". The Patriot Group, Inc., a
Massachusetts corporation ("Patriot Group"), has consented to the use by the
Trust of the identifying name "Patriot", which is a property right of Patriot
Group, in the name of the Trust. Such consent is conditioned upon the Trust's
employment of Patriot Advisers, Inc., a wholly owned subsidiary of Patriot
Group, as investment adviser to the Trust. As between Patriot Group and the
Trust, Patriot Group shall control the use of such name insofar as the name of
the Trust contains the identifying name "Patriot". Patriot Group may from time
to time use the identifying name "Patriot" in other connections and for other
purposes, including without limitation in the names of other investment
companies, corporations or businesses that it may manage, advise, sponsor or
own, or in which it may have a financial interest. Patriot Group may require the
Trust to cease using the identifying name "Patriot" in the name of the Trust if
the Trust ceases to employ Patriot Advisers, Inc., or an affiliate thereof, as
investment adviser.
Section 1.2. OFFICES; RESIDENT AGENT. The Trust shall have an office in
Boston, Massachusetts, unless changed by the Trustees to another location in
Massachusetts or elsewhere, but such office need not be the sole or principal
office of the Trust. The Trust may have such other offices or places of business
as the Trustees may from time to time determine to be necessary or expedient.
The Trustees may appoint, and from time to time replace, a resident agent for
the Trust in The Commonwealth of Massachussetts.
Section 1.3. NATURE OF TRUST. The Trust shall be a trust with
transferable shares under the laws of The Commonwealth. of Massachusetts, of the
type referred to in Section 1 of Chapter 182 of the Massachusetts General Laws
and commonly known as a Massachusetts business 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.
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Section 1.4. DEFINITIONS. As used in this Declaration of Trust, the
following terms shall have the meanings set forth below unless the context
thereof otherwise requires:
"BY-LAWS" means the By-Laws of the Trust, as amended from time to time.
"CLASS" or "CLASS OF SHARES" refers to the division of Shares into two
or more Classes as provided in Article III, Section 3.1 hereof.
"COMMON SHARES" means the Fund's common shares of beneficial interest.
"COMMISSION" means the Securities and Exchange Commission.
"CONTRACTING PARTY" has the meaning designated in Section 4.5 hereof.
"DECLARATION" and "DECLARATION OF TRUST" means this Agreement and
Declaration of Trust and all amendments or modifications thereof as from time to
time in effect.
"INITIAL TRUSTEE" has the meaning designated in the preamble hereto.
"MAJORITY OF THE TRUSTEES" means a majority of the Trustees in office at
the time in question. At any time at which there shall be only one Trustee in
office, such phrase shall mean such Trustee.
"1940 ACT" means 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.
"SERIES" or "SERIES OF SHARES" refers to the division of Shares
..representing any Class into two or more Series as provided in Article III,
Section 3.1 hereof.
"SERIES A DARTS" means the Trust's Dutch Auction Rate Transferable
Securities Preferred Stock Series A.
"SETTLOR" has the meaning designated in the preamble hereto.
"Shareholder" means a record owner of Shares.
"SHARES" means the transferable units of interest into which the
beneficial interest in the Trust shall be divided from time to time, or if more
than one Class or Series of Shares is authorized by the Trustees, the equal
proportionate transferable units into which each Class or Series of Shares shall
be divided from time to time.
"TRUST" means the Massachusetts business trust established by this
Agreement and Declaration of Trust, as amended from time to time.
"TRUSTEES" means, collectively, the Initial Trustee, so long as he 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
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which there shall be only one Trustee in office, such term shall mean such
single Trustee.
ARTICLE II
PURPOSE OF THE TRUST
The purpose of the Trust is to provide investors a managed investment
primarily in securities, debt instruments and other instruments and rights of a
financial character.
ARTICLE III
SHARES OF BENEFICIAL INTEREST
Section 3.1. DIVISION OF BENEFICIAL INTEREST. The beneficial interest in
the Trust shall at all times be divided into an unlimited number of Shares
without par value. Subject to the provisions of the Declaration of Trust and the
By-Laws regarding the powers, preferences or special or relative rights or
privileges of any outstanding Class or Series of Shares, the Trustees may divide
the Shares into two or more Classes and each such Class into one or more Series,
Shares of each such Class or Series having such provisions, including without
limitation, preferences or special or relative rights or privileges (including
conversion rights, if any) as the Trustees may determine and as shall be set
forth in the By-Laws. The number of Shares of any such Class or Series
authorized shall be unlimited, except as the By-Laws may otherwise provide. The
Trustees may from time to time divide or combine the Shares of any class or
Series into a greater or lesser number without thereby changing the
proportionate beneficial interest in the Class or Series.
Section 3.2. OWNERSHIP OF SHARES. The ownership of Shares shall be
recorded on the books of the Trust or of a transfer or similar agent. No
certificates evidencing the ownership of Shares shall be issued except as
specifically provided otherwise herein or as the Trustees may otherwise
determine from time to time and the Trustees shall have the power to call
outstanding Share certificates and replace them with book entries. The Trustees
may make such rules as they consider appropriate for the issuance of share
certificates, the transfer of Shares and similar matters. The record books of
the Trust as kept by the Trust or any transfer or similar agent, as the case may
be, shall be conclusive as to who are the Shareholders of each Class or Series
and as to the number of Shares of each Class or Series held from time to time by
each Shareholder.
Section 3.3. INVESTMENT IN THE TRUST. The Trustees may accept
investments in the Trust from such persons and on such terms and for such
consideration, which may consist of cash or tangible or intangible property or a
combination thereof, as they are the By-Laws from time to time authorize.
Section 3.4. NO PREEMPTIVE RIGHTS. Shareholders shall have no preemptive
or other right to subscribe to any additional Shares or other securities issued
by the Trust.
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Section 3.5. STATUS OF SHARES; LIMITATION OF PERSONAL LIABILITY. Shares
shall be deemed to be personal property, giving only the rights provided in this
Declaration of Trust or the By-Laws. Every Shareholder by virtue of having
become a Shareholder shall be held to have expressly assented and agreed to the
terms of this Declaration of Trust and the By-Laws and to have become a party
hereto. The death of a Shareholder during the continuance of the Trust shall not
operate to terminate the Trust nor to 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 under this
Declaration of Trust. Ownership of Shares shall not entitle the Shareholder to
any title in or to the whole or any part of the Trust property or any 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. Neither the Trust nor
the Trustees, nor any officer, employee or agent of the Trust shall have any
power to bind personally any Shareholder nor, except as specifically Provided
herein, to cal. upon any sum of money or assessment whatsoever other than such
as the Shareholder may at any time TD personally agree to Pay.
Section 3.6. CONSIDERATION FOR SHARES. The Trustees may issue Shares of
any Series for such consideration 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 non-assessable.
ARTICLE IV
TRUSTEES
Section 4.1. NUMBER, DESIGNATION, ELECTION, TERM, ETC.
(a) NUMBER. Except as otherwise provided herein or in the By-Laws,
a majority of the Trustees may increase or decrease the number of 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
(d) of this Section 4.1.
(b) ELECTION AND TERM. The Trustees shall be elected by the
Shareholders at a meeting called and held for that purpose for the terms and to
the classes as provided in this Declaration. Subject to the 1940 Act and except
as otherwise provided herein or in the By-Laws, 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 appoint their own successors and, pursuant to subsection (e) of this Section
4.1, to fill vacancies; provided, that a Trustee or Trustees shall be elected by
the Shareholders at any such time or times such action is required under this
Declaration of Trust, the By-Laws or the 1940 Act; and provided, further that
after the initial election of Trustees by the Shareholders, the term of office
of any incumbent Trustee shall continue (unless specifically provided otherwise
herein or in the By-Laws) until the termination of this Trust or his earlier
death, resignation, retirement, bankruptcy, adjudicated incompetency, or other
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incapacity or removal, or if not so terminated, until the appointment or
election of such Trustee's successor in office has become effective.
(c) CLASS. The Board of Trustees shall be divided into three Classes,
each Class to consist, as nearly as may be, of one third of the number of
Trustees then constituting the whole Board of Trustees. The Trustees shall be
elected to each Class as provided in the By-Laws. The term of office of those
Trustees elected to the first Class shall expire on the first anniversary of the
initial election of Trustees following the initial Public offering of Shares.
The term of office of the Trustees elected to the second Class shall expire one
year thereafter on the second anniversary of the initial election. The term of
office of the Trustees elected to the third Class shall expire two years
thereafter on the third anniversary of the initial election. At each succeeding
annual election, the Trustees elected to succeed those whose terms expire shall
be elected for a full term of three years.
(d) RESIGNATION, RETIREMENT AND REMOVAL. 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, and such
resignation or retirement shall take effect upon such delivery or upon such
later date as is specified in such instrument. At any meeting called for the
purpose, a Trustee elected (i) by the holders of the Series A DARTS may be
removed from his office during his term, with or without cause, but only by
action of the holders of at least 50% of the outstanding Series A DARTS, voting
separately as a Class and (ii) by the holders of the Common Shares may be
removed from his office during his term, but only for cause and only by action
of the holders of at least 75% of the outstanding Common Shares, voting
separately as a class.
(e) VACANCIES. Any vacancy or anticipated vacancy resulting from any
reason, including without limitation the death, resignation, retirement; removal
or incapacity of any of the Trustees, or an increase in the number of Trustees,
may (but unless required by the 1940 Act need not) be filled by a Majority of
the Trustees, subject to the provisions of this Declaration of Trust, the
By-Laws and the 1940 Act; provided, that if there shall be no Trustees in
office, such vacancy or vacancies shall be filled by the Shareholders. Any such
appointment or election shall take effect immediately, except that an
appointment or election 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.
(f) EFFECT OF DEATH, RESIGNATION, ETC. The death, resignation,
retirement, removal or incapacity of the Trustees, or any one of them, shall not
operate to annul or terminate the Trust or to revoke or terminate any existing
agency or contract created or entered into pursuant to the terms of this
Declaration of Trust. Whenever a vacancy shall occur, until such vacancy is
filled, the Trustees in office, regardless of their number, shall have all the
powers granted to the Trustees and shall discharge all the duties imposed upon
the Trustees by this Declaration.
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(g) NO ACCOUNTING. Except to the extent required by the 1940 Act or
under circumstances which would justify his removal for cause, no individual
ceasing to be a Trustee (nor the estate of any such individual) shall be
required to rake an accounting to the Shareholders or remaining Trustees upon
such cessation.
Section 4.2. POWERS. Subject to the provisions of this Declaration of
Trust, the business of the Trust shall be managed by the Trustees, and they
shall have all powers necessary or convenient to carry out that responsibility.
Without limiting the foregoing, the Trustees may adopt By-Laws not inconsistent
with this Declaration of Trust providing for the conduct of the business and
affairs of the Trust and, subject to Section 7.4 hereof, may amend and repeal
them to the extent that such By-Laws do not reserve that right to the
Shareholders of one or more Classes or Series; they may select, and from time to
time change, the fiscal year of the Trust; they may as they consider appropriate
elect and remove officers, appoint and terminate agents and consultants, and
hire and terminate employees, any one or more of the foregoing of whom may be a
Trustee, and may provide for the compensation of all of the foregoing; 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; they may employ one or more custodians of the
assets of the Trust and may authorize any such custodian to employ
sub-custodians or agents and to deposit all or any part of such assets in a
system or systems for the central handling of securities; they may retain
investment advisers, administrative agents, transfer agents, dividend disbursing
agents, accounting agents or shareholder servicing agents, or any of the
foregoing; they may provide for the distribution of securities issued by the
Trust through one or more underwriters, distributors or otherwise; they may 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, 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:
(i) to invest and reinvest cash and other property, and to hold
cash uninvested;
(ii) to sell, exchange, lend, mortgage, hypothecate, write options
on, lease, grant security interests in, negotiate, convey, transfer or
otherwise dispose of and trade in the assets of the Trust;
(iii) to vote or give assent or exercise any rights of ownership
with respect to stock or other securities or property; and to receive
powers of attorney from, and to execute and deliver proxies or powers of
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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 property as the Trustees shall
deem proper;
(iv) to exercise powers and rights of subscription or otherwise
which in any manner arise out of ownership of securities;
(v) to hold any security or property in a form not indicating any
trust, whether in bearer, unregistered or other negotiable form, or in
the name of the Trustees, or in the name of a custodian, sub-custodian or
other depositary or a nominee or nominees, or otherwise;
(vi) 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; to consent to any
contract, lease, mortgage, purchase or sale of property by any such
corporation or issuer; and to pay calls or subscriptions with respect to
any security held in the Trust;
(vii) to join with other security holders in acting through a
committee, depositary, voting trustee or otherwise, and in that
connection to deposit any security with, or transfer any security to, any
such committee, depositary or trustee, and to delegate to them such power
and authority with relation to any security (whether or not so deposited
or transferred) as the Trustees shall deem proper, and to agree to pay,
and to pay, such portion of the expenses and compensation of such
committee, depositary or trustee as the Trustees shall deem proper;
(viii) to compromise, arbitrate or otherwise adjust claims in favor
of or against the Trust for any matter in controversy, including but not
limited to claims for taxes;
(ix) to enter into joint ventures, general or limited partnerships
and any other combinations or associations;
(x) to borrow funds;
(xi) to endorse or guarantee the payment of any notes or other
obligations of any person; to make contracts of guaranty or surety ship,
or otherwise assume liability for payment thereof; and to mortgage or
pledge the Trust property or any part thereof to secure any part of or
all such obligations;
(xii) to purchase and pay for entirely out of the Trust property
such insurance as they may deem necessary or appropriate for the conduct
of the business of the Trust, including without limitation insurance
policies insuring the assets of the Trust, or payment of distributions
and principal on its portfolio investments, and insurance policies
insuring the Shareholders, Trustees, officers, employees, agents,
investment advisers, underwriters, or other independent contractors, of
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the Trust individually against all claims and liabilities of every nature
arising by reason of holding 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, including any action taken or omitted
that may be determined to constitute negligence, whether or not the Trust
would have the power to indemnify any such person against such liability;
(xiii) to pay pensions for faithful, service, as deemed appropriate
by the Trustees, and to adopt, establish and carry out pension, profit-
sharing, share bonus, share purchase, savings, thrift and other
retirement, incentive 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;
(xiv) to the extent necessary or appropriate to give effect to
preferences, special or relative rights and privileges of any Class or
Series of Shares, to allocate assets, liabilities, income and expenses of
the Shares or to apportion the same among two or more Classes or Series;
(xv) 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;
and to amend, extend, release or cancel any such obligations, contracts,
agreements or understandings; and to execute, acknowledge, deliver and,
record all written instruments which they may deem necessary or expedient
in the exercise of their powers; and
(xvi) 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 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,
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 interests of the Trust or otherwise to carry out the
provisions of this Declaration.
The Trustees shall not in any way be bound or limited by any present or
future law or custom concerning investments by trustees, nor shall the Trustees
be limited to investing in obligations maturing before the possible termination
of the Trust. The Trustees shall not be required to obtain a court order to deal
with any assets of the Trust or take any other actions hereunder.
Except as otherwise provided herein or from time to time in the By-Laws,
any action to be taken by the Trustees may be taken by a majority of the
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Trustees present at a meeting of Trustees (a quorum being present), within or
without Massachusetts, or by written consent of a Majority of the Trustees. Any
meeting of Trustees may be held by means of a telephone conference call or other
communications facility and participation by such means shall (except to the
extent required otherwise by the 1940 Act) constitute presence in person at such
meeting.
Section 4.3. PAYMENT OF TRUST EXPENSES; COMPENSATION OF TRUSTEES. The
Trustees are authorized to pay or to cause to be paid out of the assets of the
Trust, all expenses, fees, charges, taxes and liabilities incurred or arising in
connection with 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,
underwriter, auditor, counsel, custodian, sub-custodian, transfer agent,
dividend disbursing agent, shareholder servicing agent, and such other agents or
independent contractors and such other expenses and charges, as the Trustees may
deem necessary or proper to incur. Without limiting the generality of any other
provision hereof, the Trustees shall be entitled to reasonable compensation from
the Trust for their services as Trustees and may fix the amount of such
compensation.
Section 4.4. OWNERSHIP OF TRUST ASSETS. Title to all or the assets of
the Trust shall at all times be considered as vested in the Trustees.
Section 4.5. CERTAIN CONTRACTS. Subject to compliance with the
provisions of the 1940 Act, but notwithstanding any limitations of present and
future law or custom concerning delegation of powers by trustees generally, the
Trustees may, at any time and from time to time 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, other type of organizations, or individuals
(a "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 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:
(i) subject to the general supervision of the Trustees and in
conformity with the stated policies of the Trustees with respect to the
investments of the Trust, to manage such investments, to make investment
decisions with respect thereto, and to place purchase and sale orders for
portfolio transactions relating to such investments;
(ii) 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, to supervise all or any part of the operations
of the Trust and to provide all or any part of the administrative and
clerical personnel, office space, and office equipment and services
appropriate for the efficient administration and operation of the Trust;
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(iii) to distribute the Shares or other securities issued by the
Trust, to be principal underwriter of such Shares or securities, or to
act as agent of the Trust in the sale of such Shares or securities and
the acceptance or rejection of orders for the purchase thereof;
(iv) to act as depositary for and to maintain custody of the
property of the Trust and accounting records in connection therewith;
(v) to maintain records of ownership of outstanding Shares, the
issuance and redemption and the transfer thereof, and to disburse any
dividends declared by the Trustees and in accordance with the policies of
the Trustees and the instructions of any particular Shareholder to
reinvest any such dividends; and
(vi) to handle all or any part of the accounting responsibilities,
when her with respect to the Trust's properties, Shareholder or
otherwise.
The same person may be a Contracting Party for some or all of the
services, duties and responsibilities to, for and of the Trust 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 consistent with the 1940 Act
relating to the standard of care 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 sub-contractual arrangements relative to any of the matters referred to in
this Section 4.5.
The fact that:
(1) any of the Shareholders, Trustees or officers of the Trust is a
shareholder, director, officer, partner, trustee, employee, investment
adviser, principal underwriter or distributor, or agent of or for any
Contracting Party or of or for any parent or affiliate of any Contracting
Party, or that any Contracting Party or any parent or affiliate thereof
is a Shareholder or has an interest in the Trust, or that
(2) 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 businesses or interests, shall not affect
the validity of any such contract 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 Shareholders.
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ARTICLE V
SHAREHOLDERS' VOTING POWERS AND MEETINGS
Section 5.1. VOTING POWERS. Subject to the voting powers of one or more
Classes or Series of Shares as set forth in this Declaration of Trust or in the
By-Laws, Shareholders shall have power to vote only (i) for the election of
Trustees as provided herein, (ii) for the removal of Trustees as provided
herein, (iii) with respect to any matter as to which shareholder action is
required by the 1940 Act, ( iv) with, respect to any voluntary liquidation,
dissolution, winding up, merger or consolidation or sale of all or substantially
a1l of the assets of the Trust to the extent and as provided herein, (v) with
respect to any amendment of this Declaration of Trust or the By-Laws to the
extent and as provided herein or therein as the case may be, (vi) to the same
extent as the stockholders of a Massachusetts 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 the
Shareholders, and (vii) with respect to such additional matters as may be
required by the 1940 Act, this Declaration of Trust, the By-Laws, or any
registration with the Securities and Exchange Commission (or any successor
agency) or any state, or as the Trustees may consider necessary or desirable. On
any matter required or permitted to be voted on by the Shareholders, all Shares
then entitled to vote shall be voted in the aggregate as a single Class without
regard to Class or Series, except (i) when required by this Declaration of
Trust, the By-Laws or by the 1940 Act, or when the Trustees shall have
determined that any matter to be submitted to a vote of the Shareholders affects
the rights or interests of the Shareholders of one or more Classes or Series
materially differently, Shares shall be voted by individual Class or Series; and
(ii) when the Trustees shall have determined that the matter affects only the
interests of one or more Classes or Series, then only the Shareholders of such
Class or Classes or Series shall be entitled to vote thereon. Each Share shall
be entitled to one vote as to any matter on which it is entitled to vote and
each fractional Share shall be entitled `to a proportionate fractional vote.
There shall be no cumulative voting in the election of Trustees. Shares may be
voted in person or by proxy. A proxy with respect to ▇▇▇▇▇▇ held in the name of
two or more persons shall be valid if executed by any one of them unless at or
prior to exercise of the proxy the Trust receives a specific written notice to
the contrary from any one of them. A proxy purporting to be executed by or on
behalf of 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 5.2. MEETINGS. Meetings of the 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. Except as
otherwise provided in the By--Laws, 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 days before such meeting, postage prepaid, stating
the time, place and purpose of the meeting, to each Shareholder entitled to vote
at such meeting at the Shareholder's address as it appears on the records of the
Trust. If the Trustees shall fail to call or give notice of any meeting of
Shareholders for a period of 30 days after written application by Shareholders
holding at least 25% of the then outstanding Shares entitled to vote at such
meeting requesting that a meeting be called for a purpose requiring action by
the Shareholders as provided herein or in the By-Laws, then Shareholders holding
at least 25% of the
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then outstanding Shares entitled to vote at such meeting 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. Notice of a meeting
need not be given to any Shareholder if a written waiver of notice, executed by
him before or after the meeting, is filed with the records of the meeting, or to
any Shareholder who attends the meeting without protesting prior thereto or at
its commencement the lack of notice to him.
Section 5.3. 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 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 reasonable date and
time 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.
Section 5.4. QUORUM AND REQUIRED VOTE. A majority of the Shares entitled
to vote shall be a quorum for the transaction of business at a Shareholders'
meeting, except that where the By- Laws so require or the Trustees provide that
holders of any Class or Classes or Series shall vote as a Class or Classes or
Series, then a majority of the aggregate number of Shares of that Class or
Classes or Series entitled to vote shall be necessary to constitute a quorum for
the transaction of business by that Class or Series. 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. Except when a different vote is required by any
provision of time By-Laws or this Declaration Trust or, when such a different is
not specifica1ly provided in this Declaration of Trust or the By-Laws, the
Trustees shall in their discretion require a different vote or the vote of a
majority or different percentage of the Shares of one or more particular Classes
or Series, a majority of the Shares voted shall decide any question and a
plurality shall elect a Trustee.
Section 5.5. ACTION BY WRITTEN CONSENT. Any action taken by Shareholders
may be taken without a meeting if a majority of Shareholders entitled to vote on
the matter (or such different proportion thereof as shall be required 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 such written
consents are filed with the records of the meetings of Shareholders. Such
consent shall be treated for all purposes as a vote taken at a meeting of
Shareholders.
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Section 5.6. 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 Massachusetts business corporation under the Massachusetts
Business Corporation Law.
Section 5.7. ADDITIONAL PROVISIONS. The By-Laws may include further
provisions for Shareholders' votes and meetings and related matters.
ARTICLE VI
LIMITATION OF LIABILITY; INDEMNIFICATION
Section 6.1. TRUSTEES, SHAREHOLDERS, ETC. NOT PERSONALLY LIABLE; NOTICE.
All persons extending credit to, contracting with or having any claim against
the Trust shall look only to the assets of the Trust for payment under such
credit, contract or claim, and neither the Shareholders nor the Trustees, nor
any of the Trust's officers, employees or agents, whether past, present or
future, shall be personally liable therefor. Every note, bond, contract,
instrument, certificate or undertaking and every other act or thing whatsoever
executed or done by or on behalf of the Trust or the Trustees or any of them in
connection with the Trust shall be conclusively deemed to have been executed or
done only in or with respect to their or his capacity as Trustees or Trustee,
and such Trustees or Trustee shall not be personally liable thereon.
Notwithstanding the foregoing, nothing in this Declaration of Trust shall
protect any Trustee against any liability to which such Trustee would otherwise
be subject by reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of the office of
Trustee.
Every note, bond, contract, instrument, certificate or undertaking made
or issued by the Trustees or by any officer or officers shall give notice that
this Declaration of Trust is on file with the Secretary of The Commonwealth of
Massachusetts and shall recite that the same was executed or made by or on
behalf of the Trust or by them as Trustee or Trustees or as officer or officers
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, and may contain such further recital as he or
they may deem appropriate, but the omission thereof shall not operate to bind
any Trustee or Trustees or officer or officers or Shareholder or Shareholders
individually.
Section 6.2. TRUSTEES' GOOD FAITH ACTION; EXPERT ADVICE; NO BOND OR
SURETY. The exercise by the Trustees of their powers and discretion hereunder
shall be binding upon everyone interested. 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 or Contracting Party, 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 shall be under no liability for any act or omission in
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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
accountant, and (with respect to the subject matter of the contract involved)
any officer, partner or responsible employee of a Contracting Party. The
Trustees shall not be required to give any bond as such, nor any surety or any
other security if a bond is required.
Section 6.3. APPARENT AUTHORITY OF THE 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.
Section 6.4. INDEMNIFICATION OF TRUSTEES, OFFICERS, ETC. The Trust shall
indemnify each of its Trustees and officers and any person who serves at the
Trust's request as a director, officer or trustee of another organization in
which the Trust has any interest as a shareholder, creditor or otherwise
(hereinafter referred to, together with such person's heirs, executors,
administrators or other legal representatives, as a "Covered Person" ) against
all liabilities and expenses, including but not limited to amounts paid in
satisfaction of judgments, in compromise or as fines and penalties, and counsel
fees, reasonably incurred or paid by such Covered Person in connection with 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 he may be or may have
been threatened, while in office or thereafter, by reason of being or having
been such a Covered Person, except with respect to any matter as to which such
Covered Person shall have been finally adjudicated in any such action, suit or
other proceeding (i) not to have acted in good faith in the reasonable belief
that his action was in the best interests of the Trust, or (ii) to be 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 his
office.
Section 6.5. INDEMNIFICATION NOT EXCLUSIVE, ETC. The right of
indemnification provided by this Article shall not be exclusive of or affect any
other rights to which any Covered Person may be entitled. Nothing contained in
this Article shall affect any rights to indemnification to which personnel of
the Trust, other than Trustees or 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 6.6. INDEMNIFICATION OF SHAREHOLDERS. If any Shareholder or
former Shareholder shall be held to be personally liable 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 Shareholder or former Shareholder (or
his/her heirs, executors, administrators or other legal representatives, or in
the case of a corporation or other entity, its corporate or other general
successor) shall be entitled to be held harmless from and indemnified against
all, loss and expense arising from such liability.
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ARTICLE VII
MISCELLANEOUS
Section 7.1. DURATION AND TERMINATION. Unless terminated as herein
provided, the Trust shall continue without limitation of time. The Trust may not
be terminated unless authorized at a meeting of Shareholders called for the
purpose, by the vote of (x) the holders of at least 67% of the Shares of the
Series A DARTS then outstanding and (y) the holders of at least 67% of the
Common Shares then outstanding, each voting as a separate Class provided,
however, if such termination is recommended by two- thirds of the total number
of Trustees the, office, the vote of (x) the holders of at least 67% of the
Shares of the Series A DARTS then outstanding and (y) the holders of at least
67% of the Common Shares then outstanding, each voting as a separate Class,
shall be sufficient authorization. Subject to the provisions of the Declaration
of Trust and By-Laws regarding the powers, preferences or special or relative
rights or privileges of any Class or Series of Shares, the Trust may also be
terminated by the Trustees by written notice to the Shareholders. Upon
termination of the Trust, after paying or otherwise providing for all charges,
taxes, expenses and liabilities, whether due or accrued or anticipated, 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, ratably according to the number of Shares held by
the several Shareholders on the date of termination, except to the extent
otherwise required or permitted by the relative preferences, rights and
privileges of any Classes or Series of Shares, provided that any distribution to
the Shareholders of a particular Class or Series of Shares shall be made to such
Shareholders pro rata in proportion to the number of Shares of such Class or
Series held by each of them.
Section 7.2. REORGANIZATION. The Trust may not merge or consolidate with
any other corporation, association, trust or other organization, or sell, lease
or exchange all or substantially all of its assets, including its good will, and
thereafter be terminated, unless authorized at a meeting of Shareholders called
for the purpose, by the vote of (x) the holders of at least 67% of the Shares of
the Series A DARTS then outstanding and (y) the holders of at least 67% of the
Common Shares then outstanding, each voting as a separate Class provided,
however, if such termination is recommended by two-thirds of the total number of
Trustees then in office, the vote of (x) the holders of at least 50% of the
Shares of the Series A DARTS then outstanding and (y) the holders of at least
50% of the Common Shares then outstanding, each voting as a separate Class,
shall be sufficient authorization. Nothing contained herein shall be construed
as requiring approval of Shareholders for any sale of assets in the ordinary
course of business of the Trust.
Section 7.3. CONVERSION. The Trust may not be converted from a
"closed-end company" to an "open- end company" as those terms are defined in the
1940 Act unless authorized at a meeting of Shareholders called for the purpose,
by the vote of (x) the holders of at least 75% of the number of the Series A
DARTS then outstanding and (y) the holders of at least 75% of the Common Shares
then outstanding, each voting as a separate Class provided, however, if such
conversion is recommended by 66 2/3% of the total number of Trustees then in
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office, the vote of (x) the holders of at least 75% of the number of the Series
A DARTS then outstanding and (v) share holders of at least 50% of the Common
Stock, S then outstanding, each voting as a separate Class, shall be sufficient
authorization. Upon the adopt All of such proposal and related amendment by the
Trust's Shareholders as provided above, the Trust shall, upon complying with any
requirements of the 1940 Act and state law, become an "open-end" investment
company. Such affirmative vote or consent shall be in addition to the vote or
consent of the holders of the Shares otherwise required by law, the By-Laws or
any agreement between the Trust and any national securities exchange.
Section 7.4. 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 or adversely affect the limitation on personal liability
of any Shareholder or Trustee, or the prohibition of assessment upon the
Shareholders except as herein provided, without the express consent of each
Shareholder or Trustee involved. Subject to the foregoing, this Declaration of
Trust may be amended at any time by the Trustees, except that the Trustees may
not amend this Declaration of Trust to eliminate the rights of Shareholders of
any Class or Series to vote on any amendment of this Declaration of Trust or the
By-Laws or alter or amend the percentage of Shareholders required to approve any
amendment or action which requires a Shareholder vote unless under this
Declaration of Trust or the By- Laws an equivalent percentage of the
Shareholders has authorized such an .amendment of the Declaration of Trust or
By-Laws and the Trustees may not take any action that they would otherwise not
be entitled to take without the vote of the Shareholders of any Class or Series
of Shares pursuant to any provision of this Declaration of Trust or the By-Laws.
Any amendment which adversely affects the holders of one or more Classes or
Series of Shares shall require a vote of the Shareholders holding a majority of
the Shares so adversely affected and entitled to vote thereon and no vote of
Shareholders not so adversely affected shall be required, except that any
amendment of any provision of
(i) Section 7.1, 7.2 or this subclause (i) of Section 7.4 of Article
VII shall require a vote of the Shareholders holding 67%, or
(ii) Section 4.1(c) or Section 4.1(d) (ii) of Article IV, Section, 5.4
of Article V, Section 7.3 of Article VII or this subclause (ii) of
Section 7.4 of Article VII shall require the vote of the
Shareholders holding 75%,
of the Shares of each Class and Series entitled to vote thereon. Amendments
having the purpose of changing the name of the Trust or of supplying any
omission, curing any ambiguity or curing, correcting or supplementing any
defective or inconsistent provision contained herein shall not require
authorization by Shareholder vote.
Section 7.5 FILING OF COPIES. The original or a copy of this instrument
and of each amendment hereto shall be kept at the principal office of the Trust
where it may be inspected by any Shareholder. A copy of this instrument and of
each amendment hereto shall be filed by the Trust with the Secretary of State of
The
17
Commonwealth of Massachusetts and with the City Clerk of the City of Boston, as
well as with any other governmental office where such filings may from time to
time be required, but the failure to make any such filing shall not impair the
effectiveness of this instrument or any such amendment. Anyone dealing with the
Trust may rely on a certificate by an officer of the Trust as to whether or not
any such amendments have been made, as to the identities of the Trustees and
officers, and as to matters in connection with the Trust hereunder, and, with
the same effect as if it were the original, may rely on a copy certified by an
officer of the Trust to be a copy of this instrument or of any such amendments.
Section 7.6. APPLICABLE LAW. This Declaration of Trust is made in The
Commonwealth of Massachusetts, and it is created under and is to be governed by
and construed and administered according to the laws of said Commonwealth.
Section 7.7. REFERENCES; GENDER; HEADINGS; COUNTERPARTS. In this
instrument and in any amendment, references to this instrument, and all
expressions like "herein", "hereof", and "hereunder" shall be deemed to refer to
this instrument as a whole as the same may be amended or affected by any such
amendments. 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 hereof or control or affect the meaning, construction or effect
of this instrument. This instrument may be executed in any number of
counterparts each of which shall be deemed an original.
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IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal,
for himself and his assigns, and has thereby accepted the trusteeship as the
Initial Trustee of Patriot Premium Dividend Fund II hereby granted and agreed to
the provisions hereof, all as or the day and year first above written.
/s/ ▇. ▇▇▇ ▇. ▇▇▇▇▇▇
---------------------
▇. ▇▇▇ ▇. ▇▇▇▇▇▇
The undersigned Settlor of Patriot Premium Dividend Fund II hereby
accepts, approves and authorizes the foregoing Agreement and Declaration of
Trust of Patriot Premium Dividend Fund II.
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Dated: September 26, 1989
Address of Trust:
Patriot Premium Dividend Fund II
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Address of Trustee:
▇. ▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇▇▇ & Worcester
One Post Office ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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ACKNOWLEDGMENTS
M A S S A C H U S E T T S
Suffolk, ss. Boston, September 26, 1989
Then personally appeared the above named ▇. ▇▇▇ ▇. ▇▇▇▇▇▇ and
acknowledged the foregoing instrument to be his free act and deed.
Before me,
/s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
--------------------
Notary Public
My commission expires: 12/11/92
M A S S A C H U S E T T S
Suffolk, ss. Boston, September 26, 1989
Then personally appeared the above named ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and
acknowledged the foregoing instrument to be his free act and deed.
Before me,
/s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
--------------------
Notary Public
My commission expires: 12/11/92
20