KOBRICK-CENDANT INVESTMENT TRUST
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MASTER TRUST AGREEMENT
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AGREEMENT AND DECLARATION OF TRUST made at Boston, Massachusetts this
10th day of October, 1997, by the Trustees hereunder, and by the holders of
shares of beneficial interest to be issued hereunder as hereinafter provided.
WITNESSETH
WHEREAS this Trust has been formed to carry on the business of an
investment company; and
WHEREAS this Trust is authorized to issue its shares of beneficial
interest in separate series, all in accordance with the provisions hereinafter
set forth; and
WHEREAS the Trustees have agreed to manage all property coming into
their hands as trustees of a Massachusetts business trust in accordance with the
provisions hereinafter set forth;
NOW, THEREFORE, the Trustees hereby declare that they will hold all
cash, securities and other assets which they may from time to time acquire in
any manner as Trustees hereunder IN TRUST to manage and dispose of the same upon
the following terms and conditions for the benefit of the holders from time to
time of shares of beneficial interest in this Trust as hereinafter set forth.
ARTICLE I
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NAME AND DEFINITIONS
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Section 1.1 Name. This Trust shall be known as Kobrick-Cendant
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Investment Trust and the Trustees shall conduct the business of the Trust under
that name or any other name or names as they may from time to time determine.
Section 1.2 Definitions. Whenever used herein, unless otherwise
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required by the context or specifically provided:
(a) "By-Laws" shall mean the By-Laws of the Trust as amended from
time to time;
(b) "Commission" shall have the meaning given it in the 1940 Act;
(c) "Declaration of Trust" shall mean this Agreement and
Declaration of Trust as amended or restated from time to time;
(d) "1940 Act" refers to the Investment Company Act of 1940 and the
Rules and Regulations thereunder, all as amended from time to time;
(e) "Shareholder" means a record owner of Shares;
(f) "Shares" refers to the transferable units of interest into
which the beneficial interest in the Trust shall be divided from time to time;
(g) "Series" refers to a series of Shares established and
designated under or in accordance with the provisions of Article IV;
(h) "Trust" refers to the Massachusetts business trust established
by this Declaration of Trust, as amended from time to time, inclusive of each
and every Series established hereunder; and
(i) "Trustees" refers to the Trustees of the Trust named herein or
elected in accordance with Article III.
ARTICLE II
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PURPOSE OF TRUST
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The purpose of the Trust is to operate as an investment company and to
offer Shareholders one or more investment programs primarily in securities and
debt instruments and to engage in any and all lawful acts or activities.
ARTICLE III
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THE TRUSTEES
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Section 3.1 Number, Designation, Election, Term, etc.
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(a) Initial Trustees. Upon execution of this Declaration of Trust
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or a counterpart hereof or some other writing in which he accepts such
Trusteeship and agrees to the provisions hereof, ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇ ▇▇▇▇▇▇▇
▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, shall become Trustees.
(b) Number. The Trustees serving as such, whether named above or
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hereafter becoming Trustees, may increase or decrease (to not less than two at
any time after the effective date of the Trust's Registration Statement on Form
N-1A with the Commission) the number of Trustees to a number other than the
number theretofore determined. No decrease in the number of Trustees shall have
the effect of removing an 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 3.1.
(c) Election and Term. The Shareholders shall elect a Board of
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Trustees a the first meeting of Shareholders following the initial Acquisition
of Shares by the public. Each Trustee, whether name above or hereafter becoming
a Trustee, shall serve as a Trustee during the lifetime of this Trust and until
its termination as hereinafter provided or until such Trustee sooner dies,
resigns or is removed. The Trustees may elect their own successors, and may,
pursuant to Section 3.1(f)
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hereof, appoint Trustees to fill vacancies; provided, however, that the
Shareholders shall have the right to elect Trustees subsequent to the initial
election contemplated by this Section 3.1(c) in the event there shall at any
time be no Trustees in office or when and to the extent otherwise required by
Section 16(a) of the 1940 Act.
(d) Resignation and Retirement. Any Trustee may resign his trust
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or retire as a Trustee, by 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.
(e) Removal. Any Trustee may be removed with or without cause at
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any time: (i) by written instrument, signed by at least two-thirds of the number
of Trustees in office immediately prior to such removal, specifying the date
upon which such removal will become effective; (ii) by vote of Shareholders
holding not less than two-thirds of the shares then outstanding, cast in person
or by proxy at any meeting called for the purpose; or (iii) by a declaration in
writing signed by Shareholders holding not less than two-thirds of the Shares
then outstanding and filed with the Trust's Custodian.
(f) Vacancies. Any vacancy or anticipated vacancy resulting from
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any reason, including without limitation the death, resignation, retirement,
removal or incapacity of any of the Trustees, or resulting from an increase in
the number of Trustees by the other Trustees may (but so long as there are at
least three remaining Trustees, need not unless required by the ▇▇▇▇ ▇▇▇) be
filled by either (i) a majority of the remaining Trustees through the
appointment in writing of such other person as such remaining Trustees in their
discretion shall determine (unless a Shareholder election is required by the
▇▇▇▇ ▇▇▇) or (ii) by the election by the Shareholders, at a meeting called for
the purpose, of a person to fill such vacancy, and such appointment or election
shall be effective upon the written acceptance of the person named therein to
serve as a Trustee and agreement by such person to be bound by the provisions of
this Declaration of Trust, except that any such appointment or election in
anticipation of a vacancy to occur by reason of retirements resignation or
increase in 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 number of Trustees. As soon as any Trustee so appointed or elect
shall have accepted such appointment or election and shall have agreed in
writing to be bound by this Declaration of Trust and the appointment or election
is effective, the Trust estate shall vest in the new Trustee, together with the
continuing Trustees, without any further act or conveyance.
(g) Effect of Death, Resignation, etc. The death, resignation,
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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.
(h) No Accounting. Except to the extent required by the 1940 Act
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or under circumstances which would justify his removal for cause, no person
ceasing to be a Trustee as a result of his death, resignation, retirement,
removal or incapacity (nor the estate of such person)
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shall be required to make an accounting to the Shareholders or remaining
Trustees upon such cessation.
Section 3.2 Powers of Trustees. Subject to the provisions of this
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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 and the purpose of the Trust. The Trustees in all instances
shall act as principals, and are and shall be free from the control of the
Shareholders. The Trustees shall have full power and authority to do any and all
acts and to make and execute any and all contracts and instruments that they may
consider necessary or appropriate in connection with the management of the
Trust. The Trustees shall not be bound or limited by present or future laws or
customs with regard to investment by trustees or fiduciaries, but shall have
full authority and absolute power and control over the assets of the Trust and
the business of the Trust to the same extent as if the Trustees were sole owners
of the assets of the Trust and the business in their own right, including such
authority, power and control to do all acts and things as they, in their
uncontrolled discretion, shall deem proper to accomplish the purposes of this
Trust. 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 may amend and repeal them to the extent
that such By-Laws do not reserve that right to the Shareholders; they may ▇▇▇ or
be sued in the name of the Trust; they may from time to time in accordance with
the provisions of Section 4.1 hereof establish Series, each such Series to
operate as a separate and distinct investment medium and with separately defined
investment objectives and policies and distinct investment purposes; 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, 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 two 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 3.3 they may employ one or more advisers, administrators, depositories
and custodians and may authorize any depository or 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 and debt instruments, retain
transfer, dividend, 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, and set record dates or
times for the determination of Shareholders or various of them with respect to
various matters; they may compensate or provide for the compensation of the
Trustees, officers, advisers, administrators, custodians, other agents,
consultants and employees of the Trust or the Trustees on such terms as they
deem appropriate; and in general they may delegate to any officer of the Trust,
to any committee of the Trustees and to any employee, adviser, administrator,
distributor, depository, custodian, transfer and 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.
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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 invest and reinvest cash and other property,
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and to hold cash or other property uninvested without in any event being bound
or limited by any present or future law or custom in regard to investments by
trustees;
(b) Disposition of Assets. To sell, exchange, lend, pledge,
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mortgage, hypothecate, write options on and lease any or all of the assets of
the Trust;
(c) Ownership Powers. To vote or give assent, or exercise any
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rights of ownership, with respect to stock or other securities, debt instruments
or property; and to execute and deliver proxies or powers of attorney to such
person or persons as the Trustees shall deem proper, granting to such person or
persons such power and discretion with relation to securities, debt instruments
or property as the Trustees shall deem proper;
(d) Subscription. To exercise powers and rights of subscription or
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otherwise which in any manner arise out of ownership of securities or debt
instruments;
(e) Form of Holding. To hold any security, debt instrument or
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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 in the
name of a custodian, sub-custodian or other depository or a nominee or nominees
or otherwise;
(f) Reorganization, etc. To consent to or participate in any plan
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for the reorganization, consolidation or merger of any corporation or issuer,
any security or debt instrument of which is or was held in the Trust; 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 or debt instrument held in the Trust;
(g) Voting Trusts, etc. To join with other holders of any
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securities or debt instruments in acting through a committee, depository, voting
trustee or otherwise, and in that connection to deposit any security or debt
instrument with, or transfer any security or debt instrument to, any such
committee, depository or trustee, and to delegate to them such power and
authority with relation to any security or debt instrument (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;
(h) Compromise. To compromise, arbitrate or otherwise adjust
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claims in favor of or against the Trust or any matter in controversy, including
but not limited to claims for taxes;
(i) Partnerships, etc. To enter into joint ventures, general or
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limited partnerships and any other combinations or associations;
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(j) Borrowing and Security. To borrow funds and to mortgage and
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pledge the assets of the Trust or any part thereof to secure obligations arising
in connection with such borrowing;
(k) Guarantees, etc. To endorse or guarantee the payment of any
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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;
(l) Insurance. To purchase and pay for entirely out of Trust
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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 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, including any action taken or omitted that may be determined
to constitute negligence, whether or not the Trust would have the power to
indemnify such person against such liability; and
(m) Pensions, etc. To pay pensions for faithful service, as deemed
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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; and
Except as otherwise provided by the 1940 Act or other applicable law,
this Declaration of Trust or the By-Laws, any action to be taken by the Trustees
on behalf of the Trust may be taken by a majority of the Trustees present at a
meeting of Trustees (a quorum, consisting of at least one-half of the Trustees
then in the office, being present), within or without Massachusetts, including
any meeting held by means of a conference telephone or other communications
equipment by means of which all persons participating in the meeting can hear
each other at the same time, and participation by such means shall constitute
presence in person at a meeting, or by written consents of a majority of the
Trustees then in office (or such larger or different number as may be required
by the 1940 Act or other applicable law).
Section 3.3 Certain Contracts. Subject to compliance with the
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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 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 types 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, and/or the Trustees, and to provide for the performance and
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assumption of such other services, duties and responsibilities in addition to
those set forth below as the Trustees may determine appropriate:
(a) Advisory. Subject to the general supervision of the Trustees
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and in conformity with the stated policy of the Trustees with respect to the
investments of the Trust or of the assets belonging to any Series of Shares of
the Trust (as that phrase is defined in subsection (a) of Section 4.2), to
manage such investments and assets, make investment decisions with respect
thereto, and to place purchase and sale orders for portfolio transactions
relating to such investments and assets;
(b) Administration. Subject to the general supervision of the
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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 operations of the Trust;
(c) Distribution. To distribute the Shares of the Trust, to be
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principal underwriter of such Shares, and/or to act as agent of the Trust in the
sale of Shares and the acceptance or rejection of orders for the purchase of
Shares;
(d) Custodian and Depository. To act as depository for and to
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maintain custody of the property of the Trust and accounting records in
connection therewith;
(e) Transfer and Dividend Disbursing Agent. To maintain records of
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the 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/or the instructions of any
particular Shareholder to reinvest any such dividends;
(f) Shareholder Servicing. To provide service with respect to the
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relationship of the Trust and its Shareholders, records with respect to
Shareholders and their Shares, and similar matters; and
(g) Legal, Accounting, Taxes and Others. To handle all or any
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part of the legal, accounting, tax or other responsibilities, whether with
respect to the Trust's properties, Shareholders or otherwise.
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 sub-contractual arrangements relating to any of the matters referred to in
Sections 3.3(a) through (g) hereof.
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Subject to the provisions of the 1940 Act, 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, 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 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 its Shareholders, 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 (1) 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), (2) 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 3.4 Payment of Trust Expenses and Compensation of Trustees. The
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Trustees are authorize 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 to
charge or allocate the same to, between or among such one or more of the Series
that may be established and designated pursuant to Article IV, as the Trustees
deem fair, 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, administrator, distributor, principal underwriter, auditor,
counsel, depository, 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. 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 3.5 Ownership of Assets of the Trust. Title to all of the assets
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of the Trust shall at all times be considered as vested in the Trustees.
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ARTICLE IV
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SHARES
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Section 4.1 Description of Shares. The beneficial interest in the
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Trust shall be divided into Shares, all without par value, but the Trustees
shall have the authority from time to time to divide the class of Shares into
two or more Series of Shares, as they deem necessary or desirable to establish
and designate such Series, and to fix and determine the relative rights and
preferences as between the shares of the different Series of Shares as to right
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 several Series shall have separate voting rights or no voting
rights.
The Shares of each Series may be issued or reissued from time to time
in one or more classes ("Classes"), as determined by the Board of Trustees
pursuant to resolution. Each Class shall be appropriately designated, prior to
the issuance of any shares thereof, by some distinguishing letter, number or
title. All shares within a Class shall be alike in every particular. All
Shares of each Series shall be of equal rank and have the same powers,
preferences and rights, and shall be subject to the same qualifications,
limitations and restrictions without distinction between the shares of different
Classes thereof, except with respect to such differences among such Classes, as
the Board of Trustees shall from time to time determine to b necessary or
desirable, including differences in the rate or rates of dividends or
distributions. The Board of Trustees may from time to time increase the number
of Shares allocated to any Class already created by providing that any unissued
Shares of the applicable Series shall constitute part of such Class, or may
decrease the number of Shares allocated to any Class already created by
providing that any unissued Shares previously assigned to such Class shall no
longer constitute part thereof. The Board of Trustees is hereby empowered to
classify or reclassify from time to time any unissued Shares of each Series by
fixing or altering the terms thereof and by assigning such unissued shares to an
existing or newly created Class. Notwithstanding anything to the contrary in
this paragraph the Board of Trustees is hereby empowered (i) to redesignate any
issued Shares of any Series by assigning a distinguishing letter, number or
title to such shares and (ii) to reclassify all or any part of the issued Shares
of any Series to make them part of an existing or newly created Class.
The number of authorized Shares and the number of Shares of each
Series that may be issued is unlimited, and 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 nonassessable (but may be
subject to mandatory contribution back to the Trust as provided in subsection
(h) of Section 4.2). The Trustees may classify or reclassify any unissued
Shares or any Shares previously issued and reacquired of any Series into one or
more Series that may be established and designated from time to time. The
Trustees may hold as treasury Shares (of the same or some other Series), reissue
for such consideration and on such terms as they may determine, or cancel, at
their discretion from time to time, any Shares of any Series reacquired by the
Trust.
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The Trustees may from time to time close the transfer books or
establish record dates and times for the purposes of determining the holders of
Shares entitled to be treated as such, to the extent provided or referred to in
Section 5.3.
The establishment and designation of any Series of Shares in addition
to those established and designated in Section 4.2, or of any Class of Shares,
shall be effective (i) upon the execution by a majority of the then Trustees of
an instrument setting forth such establishment and designation and the relative
rights and preferences of such Series or Class, (ii) upon the execution of an
instrument in writing by an officer of the Trust pursuant to the vote of a
majority of the Trustees, or (iii) as otherwise provided in either such
instrument. At any time that there are no Shares outstanding of any particular
Series or Class previously established and designated the Trustees may by an
instrument executed by a majority of their number abolish that Series or Class
and the establishment and designation thereof. Each instrument referred to in
this paragraph shall have the status of an amendment to this Declaration of
Trust.
Any Trustee, officer or other 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 of the Trust to the same extent as if such person were not
a Trustee, officer or other agent of the Trust; and the Trust may issue and sell
or cause to be issued and sold and may purchase Shares of any Series 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 generally.
Section 4.2 Establishment and Designation of Series. Without
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limiting the authority of the Trustees set forth in Section 4.1 to establish and
designate further Series, the Trustees hereby establish and designate two Series
of Shares: the "Kobrick-Cendant Emerging Growth Fund" and the "Kobrick-Cendant
Capital Fund." The Shares of the Kobrick-Cendant Emerging Growth Fund and the
Kobrick-Cendant Capital Fund and any Shares of any further Series that may from
time to time be established and designated by the Trustees shall (unless the
Trustees otherwise determine with respect to some further Series at the time of
establishing and designating the same) have the following relative rights and
preferences:
(a) Assets Belonging to Series. All consideration received by the
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Trust for the issue or sale of Shares of a particular Series, together with all
assets in which such consideration is invested or reinvested, all income,
earnings, profits, and proceeds thereof, including any proceeds derived from the
sale, exchange or liquidation of such assets, and any funds or 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. Such
consideration, assets, income, earnings, profits, and proceeds thereof,
including any proceeds derived from the sale, exchange or liquidation of such
assets, and any funds or payments derived from any reinvestment of such
proceeds, in whatever form the same may be, together with any General Items (as
hereinafter defined) allocated to that Series as provided in the following
sentence, are herein referred to as "assets belonging to" that Series. In the
event that there are any assets,
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income, earnings, profits, and proceeds thereof, funds, or payments which are
not readily 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 that Series. Each such allocation by the Trustees shall be conclusive
and binding upon the Shareholders of all Series for all purposes.
(b) Liabilities Belonging to Series. The assets belonging to each
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particular Series shall be charged with the liabilities in respect of that
Series and all expenses, costs, charges and reserves belonging to that Series,
and any general liabilities, expenses, costs, charges or reserves of the Trust
which are not readily identifiable as belonging to any particular Series shall
be allocated and charged by the Trustees 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
liabilities, expenses, costs, charges and reserves allocated and so charged to a
Series are herein referred to as "liabilities belonging to" 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 of that Series
to satisfy such creditor's debt.
The Trustees shall have full discretion, to the extent not inconsistent
with the 1940 Act, to determine which items shall be treated as income and which
items as capital; and each such determination and allocation shall be conclusive
and binding upon the Shareholders.
(c) 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 holders
of Shares of that Series, from such of the income and capital gains, accrued or
realized, from the assets belonging to that Series, as the Trustees may
determine, after providing for actual and accrued liabilities belonging to that
Series. All dividends and distributions on Shares of a particular Series shall
be distributed pro rata to the holders of Shares of that Series in proportion to
the number of Shares of that Series held by such holders at the date and time of
record established for the payment of such dividends or distributions, 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. Such dividends and distributions may be made in cash or Shares 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
(h) of Section 4.2.
- 11 -
The Trust intends to qualify each Series as a "regulated investment
company" under the Internal Revenue Code of 1986, as amended, or any successor
or comparable statute thereto, and regulations promulgated thereunder. Inasmuch
as the computation of net income and gains for federal income tax purposes may
vary from the computation thereof on the books of the Trust, the Board of
Trustees shall have the power, in its sole discretion, to distribute in any
fiscal year as dividends, including dividends designated in whole or in part as
capital gains distributions, amounts sufficient, in the opinion of the Board of
Trustees, to enable each Series to qualify as a regulated investment company and
to avoid liability of the Series for federal income tax in respect of that year.
However, nothing in the foregoing shall limit the authority of the Board of
Trustees to make distributions greater than or less than the amount necessary to
qualify as a regulated investment company and to avoid liability of each Series
for such tax.
(d) Liquidation. In the event of the liquidation or dissolution of
-----------
the Trust, the Shareholders of each Series that has been established and
designated shall be entitled to receive, when and as declared by the Trustees,
the excess of the assets belonging to that Series over the liabilities belonging
to that Series. The assets so distributable to the Shareholders of any
particular Series shall be distributed among such Shareholders in proportion to
the number of Shares of that Series held by them and recorded on the books of
the Trust. The liquidation of any particular Series may be authorized at any
time by vote of a majority of the Trustees then in office, subject to the
approval of a majority of the outstanding voting Shares of that Series, as
defined in the 1940 Act.
(e) Voting. All Shares of all Series shall have "equal voting rights"
------
as such term is defined in the 1940 Act and except as otherwise provided by the
1940 Act or rules, regulations or orders promulgated thereunder. On each matter
submitted to a vote of the Shareholders, each holder of a Share shall be
entitled to one vote for each whole Share standing in his name on the books of
the Trust, irrespective of the series thereof, and all Shares of all series
shall vote as a single class ("Single Class Voting"); provided, however, that
(a) as to any matter with respect to which a separate vote of any Series is
required by the 1940 Act or rules and regulations promulgated thereunder, or
would be required under the Massachusetts Business Corporation Law if the Trust
were a Massachusetts corporation, such requirements as to a separate vote by
that Series shall apply in lieu of Single Class Voting as described above; (b)
in the event that the separate vote requirements referred to in (a) above apply
with respect to one or more Series, then, subject to (c) below, the Shares of
all other Series shall vote as a single class; and (c) as to any matter which
does not affect the interest of a particular Series, only the holders of Shares
of the one or more affected Series shall be entitled to vote.
(f) 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 once each week, to require the Trust 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 (h) of this Section 4.2 after the Shares are properly tendered for
redemption, subject to any contingent deferred sales charge in effect at the
time of redemption. Payment of the redemption price shall be in cash; provided,
however, that if the Trustees determine, which determination shall
- 12 -
be conclusive, that conditions exist which make payment wholly in cash unwise or
undesirable, the Trust may, subject to the requirements of the 1940 Act, make
payment wholly or partly in securities or other assets belonging to the Series
of which the Shares being redeemed are part 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, and such
redemption is conditioned upon the Trust having funds or property legally
available therefor.
(g) Redemption by Trust. Each Share of each Series 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 Shareholder pursuant to subsection (f) of this Section 4.2: (a) at any
time, if the Trustees determine in their sole discretion that failure to so
redeem may have materially adverse consequences to all or any of the holders of
the Shares, or any Series thereof, of the Trust, or (b) upon such other
conditions as may from time to time be determined by the Trustees and set forth
in the then current Prospectus of the Trust with respect to maintenance of
Shareholder accounts of a minimum amount. 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.
(h) Net Asset Value. The net asset value per Share of any Series
---------------
shall be the quotient obtained by dividing the value of the net assets of that
Series (being the value of the assets belonging to that Series less the
liabilities belonging to that Series) by the total number of Shares of that
Series outstanding, all determined in accordance with the methods and
procedures, including without limitation those with respect to rounding,
established by the Trustees from time to time.
The Trustees may determine to maintain the net asset value per 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
declarations 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 capital of the Trust attributable to that Series his pro rata
portion of the total number of 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 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.
(i) 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
- 13 -
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.
(j) Equality. All Shares of each particular Series shall represent an
--------
equal proportionate interest in the assets belonging to that Series (subject to
the liabilities belonging to that Series), and each Share of any particular
Series shall be equal to each other Share of that Series; but the provisions of
this sentence shall not restrict any distinctions permissible under subsection
(c) of this Section 4.2 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 particular Series into a greater or lesser
number of Shares of that Series without thereby changing the proportionate
beneficial interest in the assets belonging to that Series or in any way
affecting the rights of Shares of any other Series.
(k) Fractions. Any fractional Share of any Series or Class, if any
---------
such fractional Share is outstanding, shall carry proportionately all the rights
and obligations of a whole Share of that Series or Class, including rights and
obligations with respect to voting, receipt of dividends and distributions,
redemption of Shares, and liquidation of the Trust.
(l) Conversion Rights. 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 in accordance with such requirements and procedures as
may be established by the Trustees.
Section 4.3 Ownership of Shares. The ownership of Shares shall be
-------------------
recorded on the books of the Trust or of a transfer or similar agent for the
Trust, which books shall be maintained separately for the Shares of each Series
that has been established and designated. No certificates certifying the
ownership of Shares need be issued except as the Trustees may otherwise
determine from time to time. 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 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.
Section 4.4 Investments in the Trust. The Trustees may accept
------------------------
investments in 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 4.5 No Pre-emptive Rights. Shareholders shall have no pre-
---------------------
emptive or other right to subscribe to any additional Shares or other securities
issued by the Trust.
- 14 -
Section 4.6 Status of Shares and Limitation of Personal Liability.
-----------------------------------------------------
Shares shall be deemed to be personal property giving only the rights provided
in this instrument. 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. The death of a Shareholder during the continuance of
the Trust shall not operate to terminate the Trust nor entitle the
representative of any deceased Shareholder to an accounting or take any action
in court or elsewhere against the Trust or the Trustees, but only to the rights
of said decedent under this Trust. Ownership of 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. 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 call upon any Shareholder for the payment of any sum of money
or assessment whatsoever other than such as the Shareholder may at any time
personally agree to pay.
Section 4.7 No Appraisal Rights. Shareholders shall have no right to
-------------------
demand payment for their shares or to any other rights of dissenting
Shareholders in the event the Trust participates in any transaction which would
give rise to appraisal or dissenters' rights by a Shareholder of a corporation
organized under Chapter 156B of the General Laws of the Commonwealth of
Massachusetts, or otherwise.
ARTICLE V
---------
SHAREHOLDERS' VOTING POWERS AND MEETINGS
----------------------------------------
Section 5.1 Voting Powers. The Shareholders shall have power to vote
-------------
only (i) for the election or removal of Trustees as provided in Section 3.1,
(ii) with respect to any contract with a Contracting Party as provided in
Section 3.3 as to which Shareholder approval is as required by the 1940 Act,
(iii) with respect to any termination or reorganization of the Trust or any
Series to the extent and as provided in Sections 7.1 and 7.2, (iv) with respect
to any amendment of this Declaration of Trust to the extent and as provided in
Section 7.3, (v) 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 (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. There shall be no cumulative voting in the
election of any Trustee or Trustees. Shares may be voted in person or by proxy.
A proxy with respect to Shares 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
- 15 -
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. No annual or regular meeting of Shareholders is
--------
required. Special meetings (including meetings involving only the holders of
Shares of one or more but less than all Series) 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 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 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 30 days after written application
by Shareholders holding at least 10% of the Shares then outstanding requesting 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 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.
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 (subject to any provisions permissible
under subjection (c) of Section 4.2 with respect to dividends or distributions
on Shares that have not been ordered and/or paid for by the time or times
established by the Trustees under the applicable dividend or distribution
program or procedure then in effect) 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, 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 of the Shares voted, at a meeting of which a quorum is present shall
decide any questions and a
- 16 -
plurality shall elect a Trustee, 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.
Section 5.5 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 as shall be required by the 1940 Act or by
any express provision of this Declaration of Trust or the By-Laws) 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.
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 not
inconsistent with the provisions hereof.
Section 5.8 Shareholder Communications. Whenever ten or more
--------------------------
shareholders of record who have been such for at least six months preceding the
date of application, and who hold in the aggregate either Shares having a net
asset value of at least $25,000 or at least 1% of the outstanding shares,
whichever is less, shall apply to the Trustees in writing, stating that they
wish to communicate with other Shareholders with a view to obtaining signatures
to a request for a Shareholder meeting and accompanied by a form of
communication and request which they wish to transmit, the Trustees shall within
five business days after receipt of such application either (1) afford to such
applicants access to a list of the names and addresses of all Shareholders as
recorded upon the books of the Trust; or (2) inform such applicants as to the
approximate number of Shareholders of record, and the approximate cost of
mailing to them the proposed communication and form of request.
If the Trustees elect to follow the course specified in clause (2) above,
the Trustees, upon the written request of such applicants, accompanied by a
tender of the material to be mailed and of the reasonable expenses of mailing,
shall, with reasonable promptness, mail such material to all Shareholders of
record at their addresses as recorded on the books, unless within five business
days after such tender the Trustees shall mail to such applicants and file with
the Commission, together with a copy of the material to be mailed, a written
statement signed by at least a majority of the Trustees to the effect that in
their opinion either such material contains untrue statements of fact or omits
to state facts necessary to make the statements contained therein not
misleading, or would be in violation of applicable law, and specifying the basis
of such opinion. The Trustees shall thereafter comply with any order entered by
the Commission and the requirements of the 1940 Act and the Securities Exchange
Act of 1934.
- 17 -
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 Series with which such person
dealt for payment under such credit, contract or claim; and neither the
Shareholders of any Series nor the Trustees, nor any of the Trust's officers,
employees or agents, whether past, present or future, nor any other Series 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
by or for the Trust or the Trustees and not personally. Nothing in this
Declaration of Trust shall protect any Trustee or officer against any liability
to the Trust or the Shareholders to which such Trustee or officer 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 or of such officer.
Every note, bond, contract, instrument, certificate or undertaking made or
issued by the Trustees or by any officers or officer shall give notice that this
Declaration of Trust is on file with the Secretary of the Commonwealth of
Massachusetts 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, but the omission thereof shall not
operate to bind any Trustees or Trustee or officers or officer or Shareholders
or Shareholder individually.
Section 6.2 Trustee's 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, (a) the Trustees shall not be responsible or liable in
any event for any neglect or wrongdoing of any officer, agent, employee,
consultant, adviser, administrator, distributor or principal underwriter,
custodian or transfer, dividend disbursing, Shareholder servicing or accounting
agent of the Trust, nor shall any Trustee be responsible for the act or omission
of any other Trustee; (b) 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 (c) in discharging their duties, the Trustees 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 3.3. The Trustees as such shall not be required to give any bond or
surety or any other security for the performance of their duties.
- 18 -
Section 6.3 Indemnification of Shareholders. In case any Shareholder (or
-------------------------------
former Shareholder) 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)
shall assume the defense against such charge and satisfy any judgment thereon,
and the Shareholder or former Shareholder (or his heirs, executors,
administrators or other legal representatives or in the case of a corporation or
other entity, its corporate or other general successor) shall be entitled out of
the assets of the Trust estate to be held harmless from and indemnified against
all loss and expense arising from such liability.
Section 6.4 Indemnification of Trustees, Officers, etc. Subject to and
------------------------------------------
except as otherwise provided in the Securities Exchange Act of 1933, as amended,
and the 1940 Act, the Trust shall indemnify each of its Trustees and officers
(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 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 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 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
(such conduct 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 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 indemnitee 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, 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 the Trust 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 the Trust
if it is ultimately determined that indemnification of such expenses is not
authorized under this Article VI 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 who are not a party to the proceeding, or an independent
legal counsel in a written opinion, shall have determined, based on a review of
readily
- 19 -
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 6.5 Compromise Payment. As to any matter disposed of by a
------------------
compromise payment by any such Covered Person referred to in Section 6.4,
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 (a) by a majority of the disinterested
Trustees who are not parties to the proceeding or (b) by an independent legal
counsel in a written opinion. Approval by the Trustees pursuant to clause (a) or
by independent legal counsel pursuant to clause (b) shall not prevent the
recovery from any Covered Person of any amount paid to such Covered Person in
accordance with any of such clauses as indemnification if such Covered Person is
subsequently adjudicated by a court of competent jurisdiction 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 such Covered Person's office.
Section 6.6 Indemnification Not Exclusive, etc. The right of
----------------------------------
indemnification provided by this Article VI shall not be exclusive of or affect
any other rights to which any such Covered Person may be entitled. As used in
this Article VI, "Covered Person" shall include such person's heirs, executors
and administrators, an "interested Covered Person" is one against whom the
action, suit or other proceeding in question or another action, suit or other
proceeding on the same or similar grounds is then or has been pending or
threatened, and a "disinterested" person is a person against whom none of such
actions, suits or other proceedings or another action, suit or other proceeding
on the same or similar grounds is then or has been pending or threatened.
Nothing contained in this Article 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 6.7 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 VII
-----------
MISCELLANEOUS
-------------
Section 7.1 Duration and Termination of Trust. Unless terminated as
---------------------------------
provided herein, the Trust shall continue without limitation of time. The Trust
may be terminated at any time by a majority of the Trustees then in office
subject to a favorable vote of a majority of the outstanding voting securities,
as defined in the 1940 Act (Shares of each Series voting separately by Series).
Any Series liquidated pursuant to Section 4.2(d) or whose shares have been
redeemed pursuant to Section 4.2(g), may be terminated at any time by a majority
of the Trustees then in office, except that any such Series which is the last
remaining Series may only be so terminated by the Trustees
with the favorable vote of a majority of the outstanding voting securities, as
defined in the 1940 Act, in conformity with the provisions of subsection (d) of
Section 4.2.
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.
Section 7.2 Reorganization. The Trustees may sell, convey, merge and
--------------
transfer the assets of the Trust, or the assets belonging to any one or more
Series, to another trust, partnership, association or corporation organized
under the laws of any state of the United States, or to the Trust to be held as
assets belonging 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) with such transfer either (l) being made
subject to, or with the assumption by the transferee of, the liabilities
belonging to each Series the assets of which are so transferred, or (2) not
being made subject to, or not with the assumption of, such liabilities;
provided, however, that no assets belonging to any particular Series shall be so
transferred unless the terms of such transfer shall have first been approved at
a meeting called for the purpose by the affirmative vote of the holders of a
majority of the outstanding voting Shares, as defined in the 1940 Act, of that
Series. Following such transfer, the Trustees shall distribute such cash, shares
or other securities (giving due effect to the assets and liabilities belonging
to and any other differences among the various Series the assets belonging to
which have so been transferred) among the Shareholders of the Series the assets
belonging to which have been so transferred; and if all of the assets of the
Trust have been so transferred, the Trust shall be terminated.
The Trust, or any one or more Series, may, either as the successor,
survivor, or non-survivor, (l) consolidate with one or more other trusts,
partnerships, associations or corporations organized under the laws of the
Commonwealth of Massachusetts or any other state of the United States, to form a
new consolidated trust, partnership, association or corporation under the laws
of which any one of the constituent entities is organized, or (2) merge into one
or more other trusts, partnerships, associations or corporations organized under
the laws of the Commonwealth of Massachusetts or any other state of the United
States, or have one or more such trusts, partnerships, associations or
corporations merged into it, any such consolidation or merger to be upon such
terms and conditions as are specified in an agreement and plan of reorganization
entered into by the Trust, or one or more Series as the case may be, in
connection therewith. The terms "merge" or "merger" as used herein shall also
include the purchase or acquisition of any assets of any other trust,
partnership, association or corporation which is an investment company organized
under the laws of the Commonwealth of Massachusetts or any other state of the
United States. Any such consolidation or merger, other than the purchase or
acquisition of assets of an investment company or other collective investment
entity which is not registered under the 1940 Act, shall require the affirmative
vote of the holders of a majority of the outstanding voting Shares, as defined
in the 1940 Act, of each Series affected thereby.
Section 7.3 Amendments. All rights granted to the Shareholders under
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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 repeal the prohibition of assessment upon the Shareholders 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 as such
amendment does not have a material adverse effect on 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
then Trustees (or by an officer of the Trust Pursuant to the vote of a majority
of such Trustees). Any amendment to this Declaration of Trust that does have a
material adverse effect on the rights of Shareholders may be adopted at any time
by an instrument in writing signed by a majority of the then Trustees (or by an
officer of the Trust pursuant to a vote of a majority of such Trustees) when
authorized to do so by the vote in accordance with subsection (e) of Section 4.2
of Shareholders holding a majority of the Shares entitled to vote. Subject to
the foregoing, any such amendment shall be effective as provided in the
instrument containing the terms of such amendment or, if there is no provision
therein with respect to effectiveness, upon the execution of such instrument and
of a certificate (which may be a part of such instrument) executed by a Trustee
or officer of the Trust to the effect that such amendment has been duly adopted.
Section 7.4 Filing of Copies; References; Headings. The original or a
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copy of the instrument and of each amendment hereto shall be kept at the 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 the Commonwealth of Massachusetts as well as any other governmental
office where such filing 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 any 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. In this instrument and in any such
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.
Section 7.5 Applicable Law. This Declaration of Trust is made in The
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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.
Reference herein to Massachusetts Business Corporation Law is not intended to
give the Trust, the Trustees, the Shareholders or any other person any right,
power, authority or responsibility applicable only to or in connection with an
entity organized in corporate form. The Trust shall be of the type referred to
in Section 1 of Chapter 182 of the Massachusetts General Laws and of the type
commonly called a Massachusetts business trust, and without limiting the
provisions hereof, the Trust may exercise all powers which are ordinarily
exercised by such a trust.
IN WITNESS WHEREOF, the undersigned hereunto sets his hand in the City of
Boston, Massachusetts, as of the day and year first above written.
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