PIMCO CALIFORNIA MUNICIPAL INCOME FUND
AGREEMENT AND DECLARATION OF TRUST
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May 10, ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ MUNICIPAL INCOME FUND
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AGREEMENT AND DECLARATION OF TRUST
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AGREEMENT AND DECLARATION OF TRUST made at Boston, Massachusetts, this
10th day of May, 2001 by the Trustees hereunder, and by the holders of shares of
beneficial interest to be issued hereunder as hereinafter provided.
WITNESSETH that
WHEREAS, this Trust has been formed to carry on the business of an
investment company; 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 pro rata benefit of the holders from
time to time of Shares in this Trust as hereinafter set forth.
ARTICLE I
NAME AND DEFINITIONS
Name
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Section 1. This Trust shall be known as "PIMCO California Municipal Income
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Fund" and the Trustees shall conduct the business of the Trust under that name
or any other name as they may from time to time determine.
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Definitions
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Section 2. Whenever used herein, unless otherwise required by the context or
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specifically provided:
(a) The "Trust" refers to the Massachusetts business trust established
by this Agreement and Declaration of Trust, as amended from time to time;
(b) "Trustees" refers to the Trustees of the Trust named herein or
elected in accordance with Article IV;
(c) "Shares" means the equal proportionate 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;
(d) "Shareholder" means a record owner of Shares;
(e) The "1940 Act" refers to the Investment Company Act of 1940 and the
Rules and Regulations thereunder, all as amended from time to time;
(f) The terms "Affiliated Person", "Assignment", "Commission",
"Interested Person", "Principal Underwriter" and "Majority Shareholder
Vote" (the 67% or 50% requirement of the third sentence of Section 2(a)(42)
of the 1940 Act, whichever may be applicable) shall have the applicable
meanings given them in the 1940 Act;
(g) "Declaration of Trust" shall mean this Agreement and Declaration of
Trust as amended or restated from time to time;
(h) "By-Laws" shall mean the By-Laws of the Trust as amended from time
to time;
(i) The term "class" or "class of Shares" refers to the division of
Shares into two or more classes as provided in Article III, Section 1
hereof; and
(j) The term "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 1 hereof.
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ARTICLE II
PURPOSE
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 and to carry on such other business as the Trustees may from
time to time determine pursuant to their authority under this Declaration.
ARTICLE III
SHARES
Division of Beneficial Interest
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Section 1. The Trustees may, without Shareholder approval, authorize one or
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more classes of Shares (which classes may be divided into two or more series),
Shares of each such class or series having no par value and such preferences,
voting powers, terms of redemption, if any, and special or relative rights or
privileges (including conversion rights, if any) as the Trustees may determine
and as shall be set forth in this Declaration or in the By-Laws. The number of
Shares of each class or series authorized shall be unlimited, except as the By-
Laws may otherwise provide, and the Shares so authorized may be represented in
part by fractional shares. 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.
Ownership of Shares
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Section 2. The ownership of Shares shall be recorded on the books of the
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Trust or a transfer or similar agent. No certificates certifying the ownership
of Shares shall 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 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 and series and as to the number of Shares of each class and series
held from time to time by each Shareholder.
Investments in the Trust
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Section 3. The Trustees shall accept investments in the Trust from such
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persons and on such terms and, subject to any requirements of law, for such
consideration, which may consist of cash or tangible or intangible property or a
combination thereof, as they or the By-Laws from time to time authorize.
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No Preemptive Rights
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Section 4. Shareholders shall have no preemptive or other right to
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receive, purchase or subscribe for any additional Shares or other securities
issued by the Trust.
Derivative Claims
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Section 5. No Shareholder shall have the right to bring or maintain any
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court action, proceeding or claim on behalf of the Trust or any series or class
of Shares without first making demand on the Trustees requesting the Trustees to
bring or maintain such action, proceeding or claim. Such demand shall not be
excused under any circumstances, including claims of alleged interest on the
part of the Trustees, unless the plaintiff makes a specific showing that
irreparable nonmonetary injury to the Trust or series or class of Shares would
otherwise result. Such demand shall be mailed to the Secretary of the Trust at
the Trust's principal office and shall set forth with particularity the nature
of the proposed court action, proceeding or claim and the essential facts relied
upon by the Shareholder to support the allegations made in the demand. The
Trustees shall consider such demand within 45 days of its receipt by the Trust.
In their sole discretion, the Trustees may submit the matter to a vote of
Shareholders of the Trust or series or class of Shares, as appropriate. Any
decision by the Trustees to bring, maintain or settle (or not to bring, maintain
or settle) such court action, proceeding or claim, or to submit the matter to a
vote of Shareholders, shall be binding upon the Shareholders. Any decision by
the Trustees to bring or maintain a court action, proceeding or suit on behalf
of the Trust or a series or class of Shares shall be subject to the right of the
Shareholders under Article V hereof to vote on whether or not such court action,
proceeding or suit should or should not be brought or maintained.
Direct Claims
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Section 6. No class of Shareholders shall have the right to bring or
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maintain a direct action or claim for monetary damages against the Trust or the
Trustees predicated upon an express or implied right of action under this
Declaration or the 1940 Act (excepting rights of action permitted under section
36(b) of the 1940 Act), nor shall any single Shareholder, who is similarly
situated to one or more other Shareholders with respect to the alleged injury,
have the right to bring such an action, unless the class of Shareholders or
Shareholder has obtained authorization from the Trustees to bring the action.
The requirement of authorization shall not be excused under any circumstances,
including claims of alleged interest on the part of the Trustees. A request for
authorization shall be mailed to the Secretary of the Trust at the Trust's
principal office and shall set forth with particularity the nature of the
proposed court action, proceeding or claim and the essential facts relied upon
by the class of Shareholders or Shareholder to support the allegations made in
the request. The Trustees shall consider such request within 45 days of its
receipt by the Trust. In their sole discretion, the Trustees may submit the
matter to a vote of Shareholders of the Trust or series, as appropriate. Any
decision by the Trustees to settle or to authorize (or not to settle or to
authorize) such court action, proceeding or claim, or to submit the matter to a
vote of Shareholders, shall be binding upon the class of Shareholders or
Shareholder seeking authorization. Any decision by the Trustees to authorize a
court action, proceeding or
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suit by a class of Shareholders shall be subject to the right of the
Shareholders under Article V hereof to vote on whether or not such court action,
proceeding or suit should or should not be brought or maintained.
Status of Shares and Limitation of Personal Liability
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Section 7. Shares shall be deemed to be personal property giving only the
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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 and thereto. The death of a Shareholder
during the continuance of the Trust shall not operate to terminate the same nor
entitle the representative of any deceased Shareholder to an accounting or to
take any action in court or elsewhere against the Trust or the Trustees, but
only to the rights of said decedent 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.
ARTICLE IV
THE TRUSTEES
Number of Trustees and Term of Office
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Section 1. Subject to the voting powers of one or more classes or series of
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Shares as set forth in the By-Laws, the number of Trustees shall be such number
as shall be fixed from time to time by a written instrument signed by a majority
of the Trustees; provided, however, that the number of Trustees shall in no
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event be less than three (3) from and after the date when Shares are first sold
pursuant to a public offering. No reduction in the number of Trustees shall
have the effect of removing any Trustee from office prior to the expiration of
his or her term unless the Trustee is specifically removed pursuant to Section 2
of this Article at the time of the decrease. The Board of Trustees shall be
divided into three classes. The number of Trustees in each class shall be
determined by resolution of the Board of Trustees. The initial Trustees, each
of whom shall serve until the first meeting of Shareholders at which Trustees
are elected and until his or her successor is elected and qualified, or until he
or she sooner dies, resigns or is removed, shall be ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and such
other persons as the Trustee or Trustees then in office shall, prior to any sale
of Shares pursuant to a public offering, appoint. The term of office of all of
the initial Trustees, and any Trustee who is appointed to fill a vacancy created
by the resignation of an initial Trustee prior to the expiration of such term,
shall expire on the date of the first annual meeting of Shareholders or special
meeting in lieu thereof, which annual or special meeting shall be called to be
held not more than fifteen months after Shares are first sold
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pursuant to a public offering. The term of office of the first class shall
expire on the date of the second annual meeting of Shareholders or any special
meeting in lieu thereof. The term of office of the second class shall expire on
the date of the third annual meeting of Shareholders or any special meeting in
lieu thereof. The term of office of the third class shall expire on the date of
the fourth annual meeting of Shareholders or any special meeting in lieu
thereof. Upon expiration of the term of office of each class as set forth above,
the number of Trustees in such class, as determined by the Board of Trustees,
shall be elected for a term expiring on the date of the third annual meeting of
Shareholders or any special meeting in lieu thereof following such expiration to
succeed the Trustees whose terms of office expire. The Trustees shall be elected
at an annual meeting of the Shareholders or a special meeting in lieu thereof,
except as provided in Section 2 of this Article.
Vacancies; Resignation; Removal
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Section 2. From and after the date when Shares are first sold pursuant to a
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public offering and subject to any voting powers of one or more classes or
series of Shares as set forth in this Declaration or in the By-Laws, any
vacancies occurring in the Board of Trustees may be filled by the Trustees if,
immediately after filling any such vacancy, at least two-thirds of the Trustees
then holding office shall have been elected to such office by the Shareholders.
In the event that at any time less than a majority of the Trustees then holding
office were elected to such office by the Shareholders, the Trustees shall call
a meeting of Shareholders for the purpose of electing Trustees. Prior to the
date when Shares are first sold pursuant to a public offering, any vacancies
occurring in the Board of Trustees may be filled by the Trustees without any
action by or meeting of Shareholders. Any Trustee may resign his trust or
retire as a Trustee (without need for prior or subsequent accounting except in
the event of removal) by an instrument in writing signed by him and delivered to
the President or Secretary of the Trust, and such resignation or retirement
shall be effective upon such delivery, or at a later date according to the terms
of the instrument. Any Trustee may be removed from office only for "Cause" (as
hereinafter defined) and only (i) by action of at least seventy-five percent
(75%) of the outstanding Shares of the classes or series of Shares entitled to
vote for the election of such Trustee, or (ii) by written instrument, signed by
at least seventy-five percent (75%) of the remaining Trustees, specifying the
date when such removal shall become effective. "Cause" for these purposes shall
require willful misconduct, dishonesty or fraud on the part of the Trustee in
the conduct of his office or such Trustee being convicted of a felony.
Effect of Death, Resignation, etc. of a Trustee
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Section 3. The death, declination, resignation, retirement, removal, or
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incapacity of the Trustees, or any one of them, shall not operate to annul the
Trust or to revoke any existing agency created pursuant to the terms of this
Declaration of Trust.
Powers
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Section 4. Subject to the provisions of this Declaration of Trust, the
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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 of the Trust
and 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 of Shares.
Subject to the voting power of one or more classes or series of Shares as set
forth in the By-Laws, the Trustees may fill vacancies in or add to their number,
including vacancies resulting from increases in their number, and may elect and
remove such officers and appoint and terminate such agents as they consider
appropriate; they may appoint from their own number, and terminate, any one or
more committees consisting of two or more Trustees, including an executive
committee which may, when the Trustees are not in session, exercise some or all
of the power and authority of the Trustees as the Trustees may determine; they
may appoint an advisory board, the members of which shall not be Trustees and
need not be Shareholders, they may employ one or more custodians of the assets
of the Trust and may authorize such custodians to employ subcustodians and to
deposit all or any part of such assets in a system or systems for the central
handling of securities, retain a transfer agent or a Shareholder servicing
agent, or both, provide for the distribution of Shares by the Trust, through one
or more principal underwriters or otherwise, set record dates for the
determination of Shareholders with respect to various matters, and in general
delegate such authority as they consider desirable to any officer of the Trust,
to any committee of the Trustees and to any agent or employee of the Trust or to
any such custodian or underwriter.
Without limiting the foregoing, the Trustees shall have power and
authority:
(a) To invest and reinvest cash, and to hold cash uninvested;
(b) To sell, exchange, lend, pledge, mortgage, hypothecate, write
options on and lease any or all of the assets of the Trust;
(c) To vote or give assent, or exercise any rights of ownership, with
respect to stock or other securities 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 or property as the Trustees
shall deem proper;
(d) To exercise powers and rights of subscription or otherwise which in
any manner arise out of ownership of securities;
(e) 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 of the Trust or in the name of a custodian, subcustodian or
other depository or a nominee or nominees or otherwise;
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(f) To the extent necessary or appropriate to give effect to the
preferences, special or relative rights and privileges of any classes or
series of Shares, to allocate assets, liabilities, income and expenses of
the Trust to a particular class or classes or series of Shares or to
apportion the same among two or more classes or series;
(g) 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 such corporation or issuer, and to pay
calls or subscriptions with respect to any security held in the Trust;
(h) 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;
(i) To compromise, arbitrate or otherwise adjust claims in favor of or
against the Trust on any matter in controversy, including but not limited
to claims for taxes;
(j) To enter into joint ventures, general or limited partnerships,
limited liability companies, and any other combinations or associations;
(k) To borrow funds;
(l) To endorse or guarantee the payment of any notes or other
obligations of any person; to make contracts of guaranty or suretyship, or
otherwise assume liability for payment thereof; and to mortgage and pledge
the Trust property or any part thereof to secure any of or all of such
obligations;
(m) To purchase and pay for entirely out of Trust property such
insurance as they may deem necessary or appropriate for the conduct of the
business of the Trust, 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, investment advisers or
managers, principal underwriters or independent contractors 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 as Shareholder, Trustee, officer, employee, agent, investment
adviser or manager, principal underwriter or independent contractor,
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;
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(n) 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;
(o) To purchase or otherwise acquire Shares; and
(p) To engage in any other lawful act or activity in which business
corporations organized under the laws of The Commonwealth of Massachusetts
may engage.
The Trustees shall not in any way be bound or limited by any present or
future law or custom in regard to investments by trustees. 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 Trustees present at a meeting of
the Trustees (a quorum being present), within or without Massachusetts. 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 at a 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 a presence in person at a meeting,
or by written consents of a majority of the Trustees then in office (or such
greater number as may be required by this Declaration of Trust, the By-Laws or
applicable law).
Payment of Expense by Trust
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Section 5. The Trustees are authorized to pay, or to cause to be paid out of
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the principal or income of the Trust, or partly out of principal and partly out
of income, as they 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, manager or sub-adviser, principal underwriter,
auditor, counsel, custodian, transfer 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.
Ownership of Assets of the Trust
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Section 6. Title to all of the assets of the Trust and each series and class
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of Shares shall at all times be considered as vested in the Trustees.
Advisory, Management and Distribution
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Section 7. The Trustees may, at any time and from time to time, contract for
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exclusive or nonexclusive advisory and/or management services with any
corporation, trust, association or other organization (the "Manager"), every
such contract to comply with such requirements and restrictions as may be set
forth in the By-Laws; and any such contract may provide for one or more sub-
advisers or other agents who shall perform all or part of the obligations of the
Manager under such contract and contain such other terms interpretive of or in
addition to said requirements and restrictions as the Trustees may determine,
including, without limitation, authority to determine from time to time what
investments shall be purchased, held, sold, or exchanged and what portion, if
any, of the assets of the Trust shall be held uninvested and to make changes in
the Trust's investments. The Trustees may also, at any time and from time to
time, contract with the Manager or any other corporation, trust, association or
other organization, appointing it exclusive or nonexclusive distributor or
principal underwriter for the Shares, every such contract to comply with such
requirements and restrictions as may be set forth in the By-Laws; and any such
contract may contain such other terms interpretive of or in addition to said
requirements and restrictions as the Trustees may determine.
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
corporation, trust, association or other organization, or of or for
any parent or affiliate of any organization, with which an advisory or
management contract, or principal underwriter's or distributor's
contract, or transfer, Shareholder servicing or other agency contract
may have been or may hereafter be made or that any such organization,
or any parent or affiliate thereof, is a Shareholder or has an
interest in the Trust, or that
(ii) any corporation, trust, association or other organization
with which an advisory or management contract or principal
underwriter's or distributor's contract or transfer, Shareholder
servicing or other agency contract may have been or may hereafter be
made also has an advisory or management contract, or principal
underwriter's or distributor's contract or transfer, Shareholder
servicing or other agency contract with one or more other
corporations, trusts, associations or other organizations, or has
other business 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 its Shareholders.
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ARTICLE V
SHAREHOLDERS' VOTING POWERS AND MEETINGS
Shareholders shall have such power to vote as is provided for in, and shall
and may hold meetings and take actions pursuant to, the provisions of the By-
Laws.
ARTICLE VI
DISTRIBUTIONS AND DETERMINATION OF NET ASSET VALUE
Distributions
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Section 1. The Trustees may each year, or more frequently if they so desire,
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but need not, distribute to the Shareholders of any or all classes or series
such income and gains, accrued or realized, as the Trustees may determine, after
providing for actual and accrued expenses and liabilities (including such
reserves as the Trustees may establish) determined in accordance with good
accounting practices and subject to the preferences, special or relative rights
and privileges of the various classes or series of Shares. The Trustees shall
have full discretion to determine which items shall be treated as income and
which items as capital and their determination shall be binding upon the
Shareholders. Distributions of income for each year or other period, if any be
made, may be made in one or more payments, which shall be in Shares, in cash or
otherwise and on a date or dates and as of a record date or dates determined by
the Trustees. At any time and from time to time in their discretion, the
Trustees may distribute to the Shareholders as of a record date or dates
determined by the Trustees, in Shares, in cash or otherwise, all or part of any
gains realized on the sale or disposition of property or otherwise, or all or
part of any other principal of the Trust. Each distribution pursuant to this
Section 1 to the Shareholders of a particular class or series shall be made
ratably according to the number of Shares of such class or series held by the
several Shareholders on the applicable record date thereof, provided that no
distribution need be made on Shares purchased pursuant to orders received, or
for which payment is made, after such time or times as the Trustees may
determine. Any such distribution paid in Shares will be paid at the net asset
value thereof as determined in accordance with Section 2 of this Article VI, or
at such other value as may be specified by the By-Laws or as the Trustees may
from time to time determine, subject to applicable laws and regulations then in
effect.
Determination of Net Asset Value
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Section 2. The net asset value per share of each class and each series of
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Shares of the Trust shall be determined in accordance with the 1940 Act and any
related procedures adopted by the Trustees from time to time. Determinations
made under and pursuant to this Section 2 in good faith and in accordance with
the provisions of the 1940 Act shall be binding on all parties concerned.
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ARTICLE VII
COMPENSATION AND LIMITATION
OF LIABILITY OF TRUSTEES
Compensation
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Section 1. The Trustees as such shall be entitled to reasonable compensation
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from the Trust; they may fix the amount of their compensation. Nothing herein
shall in any way prevent the employment of any Trustee for advisory, management,
legal, accounting, investment banking, underwriting, brokerage or other services
and payment for the same by the Trust.
Limitation of Liability
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Section 2. The Trustees shall not be responsible or liable in any event for
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any neglect or wrongdoing of any officer, agent, employee, adviser, manager or
principal underwriter of the Trust, nor shall any Trustee be responsible for the
act or omission of any other Trustee, but nothing herein contained shall protect
any Trustee against any liability to which he or she would otherwise be subject
by reason of willful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of his or her office.
Every note, bond, contract, instrument, certificate, Share 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 or her capacity as Trustees or Trustee, and such Trustees or
Trustee shall not be personally liable thereon.
ARTICLE VIII
INDEMNIFICATION
Trustees, Officers etc.
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Section 1. The Trust shall indemnify each of its Trustees and officers
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(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 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 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 Covered Person, except with respect to any matter as to which such
Covered Person shall have been finally adjudicated in a decision on the
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merits in any such action, suit or other proceeding not to have acted in good
faith in the reasonable belief that such Covered Person's action was in the best
interests of the Trust and except that no Covered Person shall be indemnified
against any liability to the Trust or its Shareholders to which such Covered
Person would otherwise be subject 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. Expenses, including 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 upon receipt of an undertaking by or on behalf of such Covered
Person to repay amounts so paid to the Trust if it is ultimately determined that
indemnification of such expenses is not authorized under this Article, provided,
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that (a) such Covered Person shall provide security for his or her undertaking,
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(b) the Trust shall be insured against losses arising by reason of such Covered
Person's failure to fulfil his or her undertaking, or (c) a majority of the
Trustees who are disinterested persons and who are not Interested Persons
(provided that a majority of such Trustees then in office act on the matter), or
independent legal counsel in a written opinion shall determine, based on a
review of readily available facts (but not a full trial-type inquiry), that
there is reason to believe such Covered Person ultimately will be entitled to
indemnification.
Compromise Payment
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Section 2. As to any matter disposed of (whether by a compromise payment,
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pursuant to a consent decree or otherwise) without an adjudication in a decision
on the merits by a court, or by any other body before which the proceeding was
brought, that such Covered Person either (a) did not act in good faith in the
reasonable belief that such Covered Person's action was in the best interests of
the Trust or (b) is 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, indemnification shall
be provided if (x) approved as in the best interest of the Trust, after notice
that it involves such indemnification, by at least a majority of the Trustees
who are disinterested persons and are not Interested Persons (provided that a
majority of such Trustees then in office act on the matter), upon a
determination, based upon a review of readily available facts (but not a full
trial-type inquiry) that such Covered Person acted in good faith in the
reasonable belief that such Covered Person's action was in the best interests of
the Trust and is not 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, or (y) there has
been obtained an opinion in writing of independent legal counsel, based upon a
review of readily available facts (but not a full trial-type inquiry), to the
effect that such Covered Person appears to have acted in good faith in the
reasonable belief that such Covered Person's action was in the best interests of
the Trust and that such indemnification would not protect such Covered Person
against any liability to the Trust to which such Covered Person would otherwise
be subject by reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of his or her office.
Any approval pursuant to this Section shall not prevent the recovery from any
Covered Person of any amount paid to such Covered Person in accordance with this
Section as
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indemnification if such Covered Person is subsequently adjudicated by a court of
competent jurisdiction not to have acted in good faith in the reasonable belief
that such Covered Person's action was in the best interests of the Trust or to
have been liable to the Trust or its Shareholders by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of such Covered Person's office.
Rebuttable Presumption
----------------------
Section 3. For purposes of the determination or opinion referred to in
---------------
clause (c) of Section 1 of this Article VIII or clauses (x) or (y) of Section 2
of this Article VIII, the majority of disinterested Trustees acting on the
matter or independent legal counsel, as the case may be, shall be afforded a
rebuttable presumption that the Covered Person has not engaged in willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of such Covered Person's office.
Indemnification Not Exclusive
-----------------------------
Section 4. The right of indemnification hereby provided shall not be
----------
exclusive of or affect any other rights to which any such Covered Person may be
entitled. As used in this Article VIII, the term "Covered Person" shall include
such person's heirs, executors and administrators, and a "disinterested person"
is a person against whom none of the actions, suits or other proceedings in
question or another action, suit or other proceeding on the same or similar
grounds is then or has been pending. Nothing contained in this Article VIII
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 such person; provided, however, that the Trust
shall not purchase or maintain any such liability insurance in contravention of
the 1940 Act or other applicable law.
Shareholders
------------
Section 5. In case any Shareholder or former Shareholder shall be held to be
----------
personally liable solely by reason of his or her being or having been a
Shareholder and not because of his or her acts or omissions or for some other
reason, the Shareholder or former Shareholder (or his or 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 IX
MISCELLANEOUS
Trustees, Shareholders etc. Not Personally Liable; Notice
---------------------------------------------------------
Section 1. All persons extending credit to, contracting with or having any
----------
claim against the Trust or a particular series or class of Shares shall look
only to the assets of the Trust or the assets of that particular series or class
of Shares 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.
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 State 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
she 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.
Trustees and Officers Good Faith Action, Expert Advice, No Bond or Surety
-------------------------------------------------------------------------
Section 2. The exercise by the Trustees of their powers and discretions
----------
hereunder shall be binding upon everyone interested. A Trustee or officer shall
be liable for his or her own willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of the office of
Trustee or officer, and for nothing else, and shall not be liable for the errors
of judgment or mistakes of fact or law. The Trustees or officers 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 accordance with such advice or for failing to follow such advice.
The Trustees and officers shall not be required to give any bond as such, nor
any surety if a bond is required.
Liability of Third Persons Dealing with Trustees
------------------------------------------------
Section 3. 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.
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Duration and Termination of Trust
---------------------------------
Section 4. Unless terminated as provided herein, the Trust shall continue
----------
without limitation of time. Subject to the voting powers of one or more classes
or series of Shares as set forth in the By-Laws, the Trust may be terminated at
any time (i) by vote of Shareholders holding at least 66 2/3% of the Shares
entitled to vote or (ii) by the Trustees by written notice to the Shareholders.
Any series of class of Shares may be terminated at any time (x) by vote of
Shareholders holding at least 66 2/3% of the Shares of such series of class
entitled to vote or (y) by the Trustees by written notice to the Shareholders
of such series or class. For the avoidance of any doubt and notwithstanding
anything to the contrary in this Declaration, Shareholders shall have no
separate right to vote with respect to the termination of the Trust or a series
of class of Shares if the Trustees exercise their right to terminate the Trust
or such series or class pursuant to clauses (ii) and (y) of this Section 4.
Upon termination of the Trust or of any one or more series or classes of
Shares, after paying or otherwise providing for all charges, taxes, expenses and
liabilities, whether due or accrued or anticipated, of the Trust or of the
particular series or class, 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 or shares or other
property, or any combination thereof, and distribute the proceeds to the
Shareholders of the series or class(es) involved, ratably according to the
number of Shares of such series or class held by the several Shareholders on the
date of termination, except to the extent otherwise required or permitted by the
preferences and special or relative rights and privileges of any classes or
series of Shares.
Filing of Copies, References, Headings
--------------------------------------
Section 5. The original or a copy of this 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 State of The Commonwealth of
Massachusetts and with the Boston City Clerk, as well as any other governmental
office where such filing may from time to time be required. 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 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
amended or affected by any such amendments. 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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Applicable Law
--------------
Section 6. 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. The Trust shall be
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.
Amendments
----------
Section 7. (a) Except to the extent that the By-Laws or applicable law may
---------
require a higher vote or the separate vote of one or more classes or series of
Shares, and except as provided in paragraph (b) of this Section 7, this
Declaration of Trust may be amended at any time by an instrument in writing
signed by a majority of the then Trustees (1) when authorized so to do by a vote
of Shareholders holding a majority of the Shares entitled to vote or (2) without
Shareholder approval as may be necessary or desirable in order to authorize one
or more classes or series of Shares as in Section 1 of Article III. 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.
(b) Except to the extent that the By-Laws or applicable law may require a
higher vote or the separate vote of one or more classes or series of Shares, no
amendment may be made under this Section 7 which shall amend, alter, change or
repeal any of the provisions of Article IV, Section 1, [Article V, Section 4]
or this paragraph (b) unless the amendment effecting such amendment, alteration,
change or repeal shall receive the affirmative vote or consent of at least 66
2/3% of the Shares entitled to vote. Such affirmative vote or consent shall be
in addition to the vote or consent of the holders of Shares otherwise required
by law or by the terms of any agreement between the Trust and any national
securities exchange.
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IN WITNESS HEREOF, all of the Trustees as aforesaid do hereto set their
hands this 10th day of May, 2001.
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
COMMONWEALTH OF MASSACHUSETTS )
)
COUNTY OF SUFFOLK ) ss.
Then personally appeared before me ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, who acknowledged the
foregoing instrument to be his free act and deed.
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
Notary Public
My commission expires on:
May 10, 2001
Trustee and Address
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▇▇▇▇ ▇. ▇▇▇▇▇▇▇
c/o Ropes & ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Trust Address
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PIMCO California Municipal Income Fund
▇/▇ ▇▇▇▇▇ & ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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