EXHIBIT 1.(a)
AGREEMENT AND DECLARATION OF TRUST
OF
CFB MARKETWATCH FUNDS
This AGREEMENT AND DECLARATION OF TRUST, made at Boston,
Massachusetts this 4th day of June, 1992 by and between the
Settlor named below and the Trustee whose signature is set forth
below (the "Initial Trustee"),
W I T N E S S E T H T H A T:
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WHEREAS, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, an individual residing in
Boston, Massachusetts (the "Settlor"), proposes to deliver to the
Initial Trustee the sum of one hundred dollars ($100.00) lawful
money of the United States of America in trust hereunder and to
authorize the Initial Trustee and all other Persons acting as
Trustees hereunder to employ such funds, and any other funds
coming into their hands or the hands of their successor or
successors as such Trustees, to carry on the business of an
investment company, and as such of buying, selling, investing in
or otherwise dealing in and with stocks, bonds, debentures,
warrants, options, futures contracts and other securities and
interests therein, or calls or puts with respect to any of the
same, or such other and further investment media and other
property as the Trustees may deem advisable, which are not
prohibited by law or the terms of this Declaration of Trust; and
WHEREAS, the Initial Trustee is willing to accept such sum,
together with any and all additions thereto and the income or
increments thereof, upon the terms, conditions and trusts
hereinafter set forth; and
WHEREAS, it is proposed that the assets held by the Trustees
may be divided into separate funds or portfolios, each with its
own separate investment assets, investment objective, policies
and purposes, and that the beneficial interest in each such fund
or portfolio be divided into transferable shares of beneficial
interest, with one or more separate classes of shares for each
fund or portfolio, all in accordance with the provisions
hereinafter set forth; and
WHEREAS, it is desired that the trust established hereby
(the "Trust") be managed and operated as a trust with
transferable shares under the laws of the Commonwealth of
Massachusetts, of the type commonly known as and referred to as a
Massachusetts business trust with transferable Shares, in
accordance with the provisions hereinafter set forth;
NOW, THEREFORE, the Initial Trustee, for himself and his
successors as Trustees, hereby declares, and agrees with the
Settlor, for himself and for all Persons who shall hereafter
become holders of shares of beneficial interest of the Trust that
the Trustees will hold the sum delivered to them upon the
execution hereof, and all other and further cash, securities and
other property of every type and description which they may in
any way acquire in their capacity as such Trustees, together with
the income therefrom and the proceeds thereof, IN TRUST
NEVERTHELESS, to manage and dispose of the same for the benefit
of the holders from time to time of the shares of beneficial
interest of the several classes being issued and to be issued
hereunder and in the manner and subject to the provisions hereof,
to wit:
I.
NAME
This trust shall be known as CFB MARKETWATCH FUNDS
hereinafter called the "Trust"), and the Trustees shall conduct
the business of the Trust under that name or any other name as
they shall from time to time determine.
II.
DEFINITIONS
2.1 Definition of Certain Terms. As used in this
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Declaration of Trust, the terms set forth below shall have the
following meanings:
A. The "Act" refers to the Investment Company Act of
1940, as now or hereafter amended, to the rules and regulations
adopted from time to time thereunder and to any order or orders
thereunder which may from time to time be applicable to the
Trust.
B. The terms "affiliated person," "assignment" and
"interested person" shall have the respective meanings set forth
in the Act. The term "vote of a majority of outstanding Shares"
shall mean the "vote of a majority of the outstanding voting
securities" as defined in the Section 2(a)(42) of the Act.
C. The "Regulations" shall refer to the Code of
Regulations of the Trust as adopted and amended from time to
time.
D. The "Declaration of Trust" shall mean this
Declaration of Trust as amended or restated from time to time.
E. "Person" shall mean a natural person, a
corporation, a partnership, an association, a joint-stock
company, a trust, a fund or any organized group of persons
whether incorporated or not.
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F. "Shares" means the equal proportionate
transferable units of interest of each class into which the
beneficial interest in the Trust may be classified or
reclassified from time to time by the Trustees acting under this
Declaration of Trust, or in the absence of such action, means the
equal proportionate transferable units of interest into which the
entire beneficial interest in the Trust shall be divided from
time to time, and includes fractions of Shares as well as whole
Shares.
G. "Shareholder" means a record owner of Shares in
the Trust.
H. The "Trustees" refers to the individual trustees
of the Trust named herein or elected in accordance with
Article VI hereof in their capacity as trustees hereunder and not
as individuals and to their successor or successors while serving
in office as a trustee of the Trust, and includes a single
trustee.
I. "Trust Property" means any and all assets and
property, real or personal, tangible or intangible, which is
owned or held by or for the account of the Trust or the Trustees.
III.
PURPOSE OF TRUST; AGENT FOR SERVICE
The Trust is a Massachusetts business trust with
transferable Shares of the type described in Chapter 182
Section 1 of the General Laws of the Commonwealth of
Massachusetts formed for the purpose of acting as a management
investment company under the Act; provided, however, that the
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Trust may exercise all powers which are ordinarily exercised by
or permissible for Massachusetts business trusts with
transferable Shares.
The Agent of the Trust for Service of Process within the
Commonwealth of Massachusetts shall be: CT Corporation System,
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
IV.
OWNERSHIP OF ASSETS OF THE TRUST
The assets of the Trust shall be held separate and apart
from any assets now or hereafter held in any capacity, other than
as Trustees hereunder, by the Trustees, including without
limitation any successor Trustees. Legal title to all the assets
of the Trust shall be vested in the Trustees as joint tenants
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except that the Trustees shall have power to cause legal title to
any assets of the Trust to be held by or in the name of one or
more of the Trustees, or in the name of the Trust, or in the name
of any other person as nominee, on such terms as the Trustees may
reasonably determine. The right, title and interest of the
Trustees in the assets of the Trust shall vest automatically in
each person who may hereafter become a Trustee. Upon the
resignation, removal or death of a Trustee, such Trustee shall
automatically cease to have any right, title or interest in any
of the assets of the Trust, and the right, title and interest of
such Trustee in the assets of the Trust shall vest automatically
in the remaining Trustees. Such vesting and cessation of title
shall be effective regardless of whether conveyancing documents
(pursuant to Section 6.6 hereof or otherwise) have been executed
and delivered. Except to the extent otherwise required by
Article V hereof, no Shareholder shall be deemed to have
severable ownership in any individual asset of the Trust or any
right of partition or possession thereof, or shall be called upon
to assume any loss of the Trust or suffer an assessment of any
kind by virtue of his ownership of Shares, but each Shareholder
shall have a proportionate undivided beneficial interest in the
assets belonging to a particular class or classes of Shares to
the extent provided in Article V. The ownership of the Trust
Property of every description and the right to conduct any
business hereinbefore described shall be vested exclusively in
the Trustees, and the Shareholders shall have no interest therein
other than the beneficial interest conferred by their Shares, and
they shall have no right to call for any partition or division of
any property, profits, rights or interests of the Trust nor can
they be called upon to assume any losses of the Trust or suffer
an assessment of any kind by virtue of their ownership of Shares.
The Shares shall be personal property giving only the rights
specifically set forth in this Declaration of Trust. Shares
shall not entitle any holder thereof to preference, preemptive,
appraisal, conversion or exchange rights, except as the Trustees
may determine pursuant to Article V hereof.
V.
SHAREHOLDERS; BENEFICIAL INTEREST IN THE TRUST;
PURCHASE AND REDEMPTION OF SHARES
5.1 Shares in the Trust.
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A. The beneficial interest in the Trust shall at all
times be divided into an unlimited number of full and fractional
transferable Shares with a par value of $.001 per share. All
Shares shall be of one class, provided that subject to this
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Declaration of Trust and the requirements of applicable law, the
Trustees shall have the power to classify or reclassify any
unissued Shares into any number of additional classes of Shares
by setting or changing in any one or more respects, from time to
time before the issuance thereof, their designations,
preferences, conversion or other rights, voting powers,
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restrictions, limitations, qualifications or terms or conditions
of redemption, and provided further that the investment
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objectives, policies and restrictions governing the management
and operations of the Trust, including the management of assets
belonging to any class of Shares, may from time to time be
changed or supplemented by the Trustees, subject to the
requirements of the Act. The power of the Trustees to classify
or reclassify Shares shall include, without limitation, the power
to classify or reclassify any class of Shares into one or more
series of such class. A copy of each action of the Trustees by
which Shares are classified or reclassified pursuant to this
subsection 5.1(A), executed by a majority of the Trustees (or by
an officer of the Trust pursuant to a vote of a majority of the
Trustees), shall be kept at the office of the Trust where it may
be inspected by any Shareholder, and one copy of each such
instrument shall be filed with the Secretary of The Commonwealth
of Massachusetts, as well as with any other governmental office
where such filing may from time to time be required by the laws
of Massachusetts. All references to Shares in this Declaration
of Trust which are not accompanied by a reference to any
particular class of Shares shall be deemed to apply to all
outstanding Shares of any and all classes. All references in
this Declaration of Trust to any class of Shares shall include
and refer to the Shares of any series thereof.
Upon the issuance of the first Share of a second class of
Shares classified or reclassified by the Trustees pursuant to
this Section 5.1, all Shares theretofore issued and outstanding
shall automatically represent Shares of a separate class having
the preferences, conversion and
other rights, voting powers, restrictions, limitations,
qualifications and terms and conditions of redemption provided
for in this Declaration of Trust with respect to any class of
Shares. The Trustees may from time to time divide or combine the
outstanding Shares of the Trust, or of any class or classes with
the same alphabetical designation, into a greater or lesser
number without thereby changing the proportionate beneficial
interest of the Shares in the Trust as so divided or combined or
in the assets belonging to such class or classes, as the case may
be.
At any time that there are no Shares outstanding of a
particular class previously established and designated, the
Trustees may abolish that class and the establishment and
designation thereof.
B. Subject always to the power of the Trustees to
classify and reclassify any unissued Shares pursuant to
subsection A of this Section 5.1, Shares of the Trust shall
(unless the Trustees otherwise determine with respect to a class
of Shares at the time of establishing and designating the same)
have the following designations, preferences, conversion and
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other rights, voting powers, restrictions, limitations,
qualifications and terms and conditions of redemption:
(1) Designations. The Board of Trustees shall
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give each class of Shares an alphabetical designation ("A," "B,"
"C," etc.), and may give any class of Shares such supplementary
designations as the Board may deem appropriate. More than one
class of Shares may have the same alphabetical designation.
(2) Assets Belonging to Classes With Same
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Alphabetical Designation. All consideration received by the
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Trust for the issue and sale of Shares of any class shall be
commingled, invested and reinvested together with the
consideration received by the Trust for the issue and sale of
Shares of such other class or classes, if any, that have the same
alphabetical designation, along with all income, earnings,
profits and proceeds derived from the investment thereof,
including any proceeds derived from the sale, exchange or
liquidation of such investments, any funds or payments derived
from any reinvestment of such proceeds in whatever form the same
may be, and any general assets of the Trust not belonging to a
particular class which the Trustees may, in their sole
discretion, allocate to such classes having the same alphabetical
designation, and shall irrevocably belong to the classes with
respect to which such assets, payments or funds were received or
allocated for all purposes, subject only to the rights of
creditors, and shall be so handled upon the books of account of
the Trust. For purposes of this Declaration of Trust, such
assets and the income, earnings, profits and proceeds thereof,
including any proceeds derived from the sale, exchange or
liquidation thereof, and any assets derived from any reinvestment
of such proceeds in whatever form, are referred to as "assets
belonging to" such classes. Each Share of the classes having the
same alphabetical designation shall share equally with each other
Share of such classes in the assets belonging to such classes.
Shareholders of any class of Shares shall have no right, title or
interest in or to the assets belonging to any class of Shares
with a different alphabetical designation.
(3) Liabilities Belonging to Classes With Same
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Alphabetical Designation. The assets belonging to classes of
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Shares with the same alphabetical designation shall be charged
with the direct liabilities in respect of such classes and shall
also be charged with such classes' proportionate share of the
general liabilities of the Trust as determined by comparing the
assets belonging to such classes with the aggregate assets of the
Trust, provided, that the Board of Trustees may, in their
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discretion, direct that any one or more general liabilities of
the Trust be allocated to the respective classes on a different
basis. The liabilities so charged to such classes are herein
referred to as "liabilities belonging to" such classes, and each
Share of such classes shall be charged equally with each other
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Share of a class having the same alphabetical designation with
the liabilities belonging to such classes, except that:
(a) A class of Shares with respect to which
agreements are entered into by or on behalf of the Trust pursuant
to which institutions agree to provide services with respect to
beneficial owners of Shares of that class but not with respect to
beneficial owners of Shares of other classes with the same
alphabetical designation shall bear the expenses and liabilities
relating to such agreements, as well as any other expenses
directly attributable to such class of Shares which the Trustees
determine should be borne solely by such class; and
(b) A class of Shares shall not be required
to bear the expenses and liabilities relating to any agreement
described in clause (a) above pursuant to which an institution
agrees to provide services with respect to beneficial owners of
Shares of other classes with the same alphabetical designation
but not to beneficial owners of Shares of that class, or any
other expenses directly attributable to one or more other classes
of Shares which the Trustees determine should be borne solely by
such other class or classes.
(4) Dividends and Distributions. Shares of
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classes having the same alphabetical designation shall be
entitled to such dividends and distributions, in Shares or in
cash or both, as may be declared from time to time by the
Trustees, acting in their sole discretion, with respect to such
classes, provided that such dividends and distributions shall be
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paid only out of the lawfully available "assets belonging to"
such classes as such term is defined in subsection B(2) of this
Section 5.1.
(5) Liquidating Distributions. In the event of
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the termination of the Trust and the winding up of its affairs,
the Shareholders of classes having the same alphabetical
designation shall be entitled to receive out of the assets of the
Trust available for distribution to Shareholders, but other than
general assets not belonging to any particular class of Shares,
the assets belonging to such classes and the assets so
distributable to the Shareholders of such
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classes shall, subject to the allocation of certain liabilities
to a particular class as set forth in subsection B(3) of this
Section 5.1, be distributed among such shareholders in proportion
to the number of Shares of such classes held by them and recorded
in their name on the books of the Trust. In the event that there
are any general assets not belonging to any particular class of
Shares and available for distribution, the Shareholders of
classes having the same alphabetical designation shall be
entitled to receive a portion of such general assets determined
by comparing the assets belonging to such classes with the
aggregate assets of the Trust; and the assets so distributable to
the Shareholders of such classes shall, subject to the allocation
of certain liabilities to a particular class as set forth in
subsection B(3) of this Section 5.1, be distributed among such
Shareholders in proportion to the number of Shares of such
classes held by them and recorded in their name on the books of
the Trust.
(6) Voting. The holder of each Share shall be
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entitled to one vote for each full Share, and a proportionate
fractional vote for each fractional Share, irrespective of the
class, then recorded in his name on the books of the Trust, to
the extent provided in Article VIII hereof.
(7) Preemptive Rights. Shareholders shall have
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no preemptive or other rights to subscribe to any additional
Shares or other securities issued by the Trust.
(8) Conversion Rights. The Trustees shall have
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the authority to provide from time to time that the holders of
Shares of any class shall have the right to convert or exchange
said Shares for or into Shares of one or more other classes in
accordance with such requirements and procedures as may be
established from time to time by the Trustees.
(9) Redemption of Shares. To the extent of the
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assets of the Trust legally available for such redemptions, a
Shareholder of the Trust shall have the right to require the
Trust to redeem his full and fractional Shares of any class out
of assets belonging to the classes with the same alphabetical
designation as such class at a redemption price equal to the net
asset value per Share next determined after receipt of a request
to redeem in proper form as determined by the Trustees, subject
to the right of the Trustees to suspend the right of redemption
of Shares or postpone the date of payment of such redemption
price in accordance with the provisions of applicable law. The
Trustees shall establish such rules and procedures as they deem
appropriate for the redemption of Shares, provided that all
redemptions shall be in accordance with the Act. Without
limiting the generality of the foregoing, the Trust shall, to the
extent permitted by applicable law, have the right at any time to
redeem the Shares owned by any holder thereof: (a) in connection
with the termination of any class of Shares as provided
hereunder; (b) if the value of such Shares in the account or
accounts maintained by the Trust or its transfer agent for any
class or classes of Shares is less than the value determined from
time to time by the Trustees as the minimum required for an
account or accounts of such class or classes, provided that the
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Trust shall provide a Shareholder with written notice at least
fifteen (15) days prior to effecting a redemption of Shares as a
result of not satisfying such requirement; (c) to reimburse the
Trust for any loss it has sustained by reason of the failure of
such Shareholder to make full payment for Shares purchased by
such Shareholder; (d) to collect any charge relating to a
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transaction effected for the benefit of such Shareholder which is
applicable to Shares as provided in the prospectus relating to
such Shares; or (e) if the net income with respect to any
particular class of Shares should be negative or it should
otherwise be appropriate to carry out the Trust's
responsibilities under the Act, in each case subject to such
further terms and conditions as the Trustees may from time to
time establish. The redemption price of Shares in the Trust
shall, except as otherwise provided in this subsection, be the
net asset value thereof as determined by the Trustees from time
to time in accordance with the provisions of applicable law, less
such redemption fee or other charge, if any, as may be fixed by
the Trustees. When the net income of any class with respect to
which the Trustees have, in their discretion, established a
policy of maintaining a constant net asset value per Share is
negative or whenever deemed appropriate by the Trustees in order
to carry out the Trust's responsibilities under the Act, the
Trust may, without payment of compensation but in consideration
of the interests of the Trust and the holders of Shares of such
class in maintaining a constant net asset value per Share of such
class, redeem pro rata from each holder of record on such day,
such number of full and fractional Shares of such class as may be
necessary to reduce the aggregate number of outstanding Shares in
order to permit the net asset value thereof to remain constant.
Payment of the redemption price, if any, shall be made in cash by
the Trust at such time and in such manner as may be determined
from time to time by the Trustees unless, in the opinion of the
Trustees, which shall be conclusive, conditions exist which make
payment wholly in cash unwise or undesirable; in such event the
Trust may make payment in the assets belonging or allocable to
the classes of Shares having the same alphabetical designation as
the class of the Shares redemption of which is being sought, the
value of which shall be determined as provided herein.
(10) Termination of Classes. Without the vote of
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the Shares of any class then outstanding (unless otherwise
required by applicable law), the Trustees may:
(a) Sell and convey the assets belonging to
any class or classes of Shares having the same alphabetical
designation to another trust or corporation that is a management
investment company (as defined in the Act) and is organized under
the laws of any state of the United States for consideration
which may include the assumption of all outstanding obligations,
taxes and other liabilities, accrued or contingent, belonging to
such class(es) and which may include securities issued by such
trust or corporation. Following such sale and conveyance, and
after making provision for the payment of any liabilities
belonging to such class(es) that are not assumed by the purchaser
of the assets belonging to such class(es), the Trust may, at the
Trustees' option, redeem all outstanding Shares of such class(es)
at net asset value as determined by the Trustees in accordance
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with the provisions of applicable law, less such redemption fee
or other charge, if any, as may be fixed by the Trustees.
Notwithstanding any other provision of this Declaration of Trust
to the contrary, the redemption price may be paid in cash or by
distribution of the securities or other consideration received by
the Trust for the assets belonging to such class(es) upon such
conditions as the Trustees deem, in their sole discretion, to be
appropriate consistent with applicable law and this Declaration
of Trust;
(b) Sell and convert the assets belonging to
any class or classes of Shares having the same alphabetical
designation into cash and, after making provision for the payment
of all obligations, taxes and other liabilities, accrued or
contingent, belonging to such class(es), the Trust may, at the
Trustees' option, (i) redeem all outstanding Shares of such
class(es) at net asset value as determined by the Trustees in
accordance with the provisions of applicable law, less such
redemption fee or other charge, if any, as may be fixed by the
Trustees upon such conditions as the Trustees deem, in their sole
discretion, to be appropriate consistent with applicable law and
this Declaration of Trust; or (ii) combine the assets belonging
to such class(es) following such sale and conversion with the
assets belonging to any one or more other class(es) of Shares
having a different alphabetical designation pursuant to and in
accordance with subsection (c) of this Section 5.1(B)(10);
(c) Combine the assets belonging to any
class or classes of Shares having the same alphabetical
designation with the assets belonging to any one or more other
classes of Shares having a different alphabetical designation if
the Trustees reasonably determine that such combination will not
have a material adverse effect on the Shareholders of any class
participating in such combination. In connection with any such
combination of assets the Shares of any class then outstanding
may, if so determined by the Trustees, be converted into Shares
of any other class or classes of Shares participating in such
combination, or may be redeemed, at the option of the Trustees,
at net asset value as determined by the Trustees in accordance
with the provisions of applicable law, less such redemption fee
or other charge, or conversion cost, if any, as may be fixed by
the Trustees upon such conditions as the Trustees deem, in their
sole discretion, to be appropriate consistent with applicable law
and this Declaration of Trust. Notwithstanding any other
provision of this Declaration of Trust to the contrary, any
redemption price, or part thereof, paid pursuant to this
subsection may be paid in Shares of any other class or classes
participating in such combination; or
(d) Otherwise terminate and wind up the
affairs of any class or classes of Shares having the same
alphabetical designation in accordance with this Declaration of
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Trust and applicable law. In connection with such termination of
a class or classes of Shares having the same alphabetical
designation and the winding up of the affairs of such class(es),
all of the powers of the Trustees under this Declaration of Trust
shall continue until the affairs of such class(es) shall have
been wound up, including the power to fulfill or discharge the
contracts of the Trust relating to such class(es), to collect
assets belonging to such class(es), to sell, convey, assign,
exchange, transfer or otherwise dispose of all or any part of the
remaining assets belonging to such class(es) to one or more
persons at public or private sale for consideration that may
consist in whole or in part of cash, securities or other property
of any kind, to discharge or pay the liabilities belonging to
such class(es), and to do all other acts appropriate to liquidate
the business of such class(es), provided that the holders of
Shares of any class shall not be entitled in any liquidation to
receive any distribution upon the assets belonging to any other
class that has a different alphabetical designation.
If no Shares of a class then remain outstanding, or after
the excess of the assets belonging to any class(es) of Shares
over the liabilities belonging to such class(es) has been
distributed among the Shareholders of such class(es) as provided
in this Declaration of Trust, the Trustees may authorize the
termination of such class(es) of Shares.
5.2 Purchase of Shares. The Trustees may accept
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investments in the Trust from such persons for such
consideration, including cash or property, and on such other
terms as they may from time to time authorize and the Trustees
may in such manner acquire other assets (including the
acquisition of assets subject to, and in connection with, the
assumption of liabilities) and businesses. The Trustees may in
their discretion reject any order for the purchase of Shares.
5.3 Net Asset Value Per Share. The net asset value per
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Share of any class of Shares shall be computed at such time or
times as the Trustees may specify pursuant to the Act. Assets
shall be valued and net asset value per Share shall be determined
by such person or persons as the Trustees may appoint under the
supervision of the Trustees in such manner as the Trustees may
determine not inconsistent with the Act.
5.4 Ownership of Shares. The ownership of Shares shall be
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recorded on the record books of the Trust. The Trustees may make
such rules and regulations as they consider appropriate for the
issuance of Share certificates, the transfer of Shares and
similar matters. Certificates certifying the ownership of Shares
may be issued as the Trustees may determine from time to time,
provided that the Trustees shall have the power to call
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outstanding Share certificates and to replace them with book
entries. The record books of the Trust shall be conclusive as to
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the identity of holders of Shares and as to the number of Shares
held by each Shareholder.
VI.
THE TRUSTEES
6.1 Management of the Trust. The affairs of the Trust
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shall be managed by the Trustees and they shall have all powers
necessary or desirable to carry out such responsibility,
including without limitation the appointment of and delegation of
responsibility to such officers, employees, agents, and
contractors as they may select.
6.2 Number and Term of Office. The number of Trustees
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shall be determined from time to time by the Trustees themselves,
but shall not be more than ten. Subject to the provisions of
this section relating to resignation or removal, the Trustees
shall have the power to set and alter the terms of office of the
Trustees, and they may at any time lengthen or shorten their own
terms or make their terms of unlimited duration, provided that
the term of office of any incumbent Trustee shall continue until
terminated as provided in the concluding sentence of this
Section 6.2 or, if not so terminated until the election of such
Trustee's successor in office has become effective in accordance
with this section. A Trustee shall qualify by accepting in
writing his election or appointment and agreeing to be bound by
the provisions of this Declaration of Trust. Except as otherwise
provided herein in the case of vacancies, Trustees (other than
the Initial Trustee provided in Section 6.3 hereof) shall be
elected by the Shareholders at such time or times as the Trustees
shall determine that such election is required under
Section 16(a) of the Act or is otherwise advisable.
Notwithstanding the foregoing, (a) any Trustee may resign as a
Trustee by written instrument signed by him and delivered to the
other Trustees at the principal business office of the Trust
(without need for prior or subsequent accounting), which shall
take effect upon such delivery or upon such later date as is
specified therein; (b) any Trustee may be removed at any time
with or without cause by written instrument, signed by a least
two-thirds of the number of Trustees in office prior to such
removal, specifying the date when such removal shall become
effective; (c) any Trustee who has become incapacitated by
illness or injury may be removed by written instrument signed by
a majority of the other Trustees; and (d) the term of a Trustee
shall terminate at his death, resignation, removal or adjudicated
incompetency.
6.3 Initial Trustee. The initial Trustee shall be
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▇▇▇▇ ▇. ▇▇▇▇▇, who, by his execution hereof, has agreed to be
bound by the provisions of this Declaration of Trust. The
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initial Trustee shall have the power to appoint additional
Trustees prior to any public meeting.
6.4 Quorum. At all meetings of the Trustees, a majority of
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the Trustees shall constitute a quorum for the transaction of
business and the action of a majority of the Trustees present at
any meeting at which a quorum is present shall be the action of
the Trustees unless the concurrence of a greater proportion is
required for such action by law, the Regulations or this
Declaration of Trust. If a quorum shall not be present at any
meeting of Trustees, the Trustees present thereat may by a
majority vote adjourn the meeting from time to time, without
notice other than announcement at the meeting, until a quorum
shall be present. Meetings may be held by means of a conference
telephone circuit or similar communications equipment by means of
which all persons participating may hear each other. The
Trustees may also act without a meeting, unless provided
otherwise in this Declaration of Trust or required by law, by
written consent of a majority of the Trustees. As used herein, a
"majority of the Trustees" shall mean a majority of the Trustees
in office at the time in question or if there shall be only one
(1) Trustee in office then such term shall mean such Trustee.
The Trustees may appoint committees of Trustees and delegate
powers to them as provided in the Regulations. Any committee of
the Trustees, including an executive committee, if any, may act
with or without a meeting. A quorum for all meetings of any such
committee shall be a majority of the members thereof. Unless
provided otherwise in this Declaration of Trust, any action of
any such committee may be taken at a meeting at which a quorum is
present by vote of a majority of the members present or without a
meeting by written consent of a majority of all the members.
6.5 Vacancies. In case a vacancy shall exist by reason of
---------
an increase in number, or for any other reason, the remaining
Trustee or Trustees may fill such vacancy by appointing such
other person as he or they in their discretion shall select. An
appointment of a Trustee may be made in anticipation of a vacancy
to occur at a later date by reason of retirement or resignation
of a Trustee or an increase in the number of Trustees; provided,
that such appointment will not become effective prior to such
retirement or resignation or such increase in the number of
Trustees. Whenever a vacancy in the number of Trustees shall
occur, until such vacancy is filled as provided in this
Section 6.5, the Trustee or Trustees then in office, regardless
of number, shall have all the powers granted to the Trustees, and
shall discharge all the duties imposed on the Trustees, by this
Declaration of Trust. A written instrument certifying the
existence of such vacancy signed by a majority of the Trustees
shall be conclusive evidence of the existence of such vacancy.
Such appointment shall be evidenced by a written instrument
signed by a majority of the then Trustees but the appointment
-13-
shall not take effect until the individual so named shall have
qualified by accepting in writing the appointment and agreeing to
be bound by the terms of this Declaration of Trust. A vacancy
may also be filled by the Shareholders in an election held at an
annual or special meeting. As soon as any Trustee so appointed
or elected shall have qualified, the Trust estate shall vest in
the new Trustee or Trustees, together with the continuing
Trustees, without any further act or conveyance.
6.6 Effect of Death, Resignation, etc. of Trustee. The
---------------------------------------------
death, resignation, removal, or 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. Upon the resignation or removal of a
Trustee, or his otherwise ceasing to be a Trustee, he shall
execute and deliver such documents as the remaining Trustees
shall require for the purpose of conveying to the Trust or the
remaining Trustees any Trust Property held in the name of the
resigning or removed Trustee. Upon the incapacity or death of
any Trustee, his legal representative shall execute and deliver
on his behalf such documents as the remaining Trustees shall
require as provided in the preceding sentence. The failure to
request or deliver such documents shall not affect the operation
of the provisions of Article IV hereof.
6.7 Powers. 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
desirable in connection with the management of the Trust. The
Trustees shall not be bound or limited by present or future laws
or customs in regard to Trust investments, but shall have full
authority and power to make any and all investments which they,
in their uncontrolled discretion, shall deem proper to accomplish
the purpose of this Trust. Without limiting the foregoing, and
subject to any applicable limitation in this Declaration of Trust
or the Regulations, the Trustees shall have power and authority:
A. To conduct, operate and carry on, either directly
or through one or more wholly-owned subsidiaries, the business of
an investment company or any other lawful business activity which
the Trustees, in their sole and absolute discretion, consider to
be (1) incidental to the business of the Trust or any class of
Shares as an investment company, (2) conducive to or expedient
for the benefit or protection of the Trust or the Shareholders of
any class of Shares, or (3) calculated in any other manner to
promote the interests of the Trust or the Shareholders of any
class of Shares.
B. To adopt Regulations not inconsistent with this
Declaration of Trust providing for the conduct of the affairs of
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the Trust and to amend and repeal them to the extent that they do
not reserve that right solely to the Shareholders.
C. To issue, sell, repurchase, redeem, retire,
cancel, acquire, hold, resell, reissue, dispose of, transfer, and
otherwise deal in Shares of the Trust; and to apply to any such
repurchase, redemption, retirement, cancellation or acquisition
of Shares, any funds or other assets of the Trust, whether
constituting capital or surplus or otherwise, to the full extent
now or hereafter permitted by applicable law; and to divide or
combine Shares without thereby changing the proportionate
beneficial interest in the Trust.
D. To issue, acquire, hold, resell, convey, write
options on, and otherwise deal in securities, debt instruments
and other instruments and rights of a financial character and to
apply to any acquisition of securities any property of the Trust
whether from capital or surplus or otherwise.
E. To invest and reinvest cash, and to hold cash
uninvested.
F. To borrow money, issue guarantees of indebtedness
or contractural obligations of others, to sell, exchange, lend,
pledge, mortgage, hypothecate, write options on and lease any or
all of the Trust Property.
G. To act as a distributor of Shares and as
underwriter of, or broker or dealer in, securities or other
property.
H. 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.
I. To exercise powers and rights of subscription or
otherwise which in any manner arise out of ownership of
securities.
J. 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, sub-custodian or other depositary
or a nominee or nominees or otherwise.
K. 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; and
consent to any contract, lease, mortgage, purchase or sale of
-15-
property by such corporation or issuer; and to pay calls or
subscriptions with respect to any security held in the Trust.
L. 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.
M. To enter into joint ventures, general or limited
partnerships and any other combinations or associations.
N. To enter into contracts of any kind and
description.
O. To collect all property due to the Trust, to pay
all claims, including taxes, against the assets belonging to the
Trust, to prosecute, defend, compromise, arbitrate, or otherwise
adjust claims in favor of or against the Trust or any matter in
controversy including, but not limited to, claims for taxes, to
foreclose any security interest securing any obligations by
virtue of which any property is owed to the Trust, and to enter
into releases, agreements and other instruments.
P. To retain and employ any Person or Persons to
serve on behalf of the Trust as investment adviser,
administrator, transfer agent, custodian, underwriter,
distributor or in such other capacities as they consider
desirable and to delegate such power and authority as they
consider desirable to any such Person or Persons.
Q. To indemnify any person with whom the Trust has
dealings.
R. To purchase and pay for entirely out of Trust
Property such insurance as they may deem necessary or appropriate
for the conduct of the business, including without limitation,
insurance policies insuring the Trust Property 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
-16-
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.
S. To engage in and to prosecute, defend, compromise,
abandon, or adjust, by arbitration or otherwise, any actions,
suits, proceedings, disputes, claims, and demands relating to the
Trust or the Trust Property, and, out of the Trust Property, to
pay or to satisfy any debts, claims or expenses incurred in
connection therewith, including those of litigation, and such
power shall include without limitation the power of the Trustees
or any appropriate committee thereof, in the exercise of their or
its good faith business judgment, consenting to dismiss any
action, suit, proceeding, dispute, claims, or demand, derivative
or otherwise, brought by any person, including a Shareholder in
such Shareholder's own name or in the name of the Trust, whether
or not the Trust or any of the Trustees may be named individually
therein or the subject matter arises by reason of business for or
on behalf of the Trust.
T. To establish pension, profit sharing, Share
purchase, and other retirement, incentive and benefit plans for
any Trustees, officers, employees and agents of the Trust.
U. To determine and change the fiscal year of the
Trust and the method by which its accounts shall be kept.
V. To establish in their absolute discretion in
accordance with the provisions of applicable law the basis or
method for determining the value of the assets belonging to any
class or classes of Shares, the value of the liabilities
belonging to any class or classes of Shares, the allocation of
any assets or liabilities to any class or classes of Shares, the
net asset value of any class of Shares, the times at which Shares
of any class shall be deemed to be outstanding or no longer
outstanding and the net asset value of each Share of any class
for purposes of sales, redemptions, repurchases of Shares or
otherwise.
W. To determine in accordance with generally accepted
accounting principles and practices what constitutes net profits
or net earnings, and to determine what accounting periods shall
be used by the Trust for any purpose, whether annual or any other
period, including daily; to set apart out of the assets belonging
to any class or classes of Shares such reserves of funds for such
purposes as it shall determine and to abolish the same; to
declare and pay any dividends and distributions to any class of
Shares in cash, securities or other property from any assets
legally available therefor, at such intervals (which may be as
frequently as daily) or on such other periodic basis, as it shall
determine; to declare such dividends or distributions by means of
a formula or other method of determination, at meetings held less
-17-
frequently than the frequency of the effectiveness of such
declaration; to establish payment dates for dividends or any
other distributions on any basis, including dates occurring less
frequently than the effectiveness of declarations thereof; and to
provide for the payment of declared dividends on a date earlier
or later than the specified payment date in the case of
Shareholders redeeming their entire ownership of Shares of any
class.
X. To engage in any other lawful act or activity in
which a Massachusetts business trust with transferable Shares or
a corporation organized under the Massachusetts Business
Corporation Law may engage.
No one dealing with the Trustees shall be under any
obligation to make any inquiry concerning the authority of the
Trustees, or to see to the application of any payments made or
property transferred to the Trustees or upon their order.
6.8 Trustees and Representatives as Shareholders. Any
--------------------------------------------
Trustee, representative or other agent of the Trust may acquire,
own and dispose of Shares of the Trust to the same extent as if
he were not a Trustee, representative or agent; and the Trust may
issue and sell or cause to be issued and sold Shares of the Trust
to, and may buy such Shares from, any person with which such
Trustee, representative or agent is affiliated subject only to
the general limitations herein contained as to the sale and
purchase of such Shares; all subject to any restrictions which
may be contained in the Regulations.
6.9 Expenses; Trustee Reimbursement. The Trustees shall
-------------------------------
have the power to incur and to pay (or shall be reimbursed) from
the Trust Property all expenses and disbursements of the Trust,
including, without limitation, interest expense, compensation
payable to Trustees and representatives of the Trust, taxes, fees
and commissions of every kind incurred in connection with the
affairs of the Trust, expenses of issue, repurchase and
redemption of Shares, expenses of registering and qualifying the
Trust and its Shares under Federal and State securities laws and
regulations, charges of custodians, transfer agents, investment
advisers, administrators and registrars, expenses in obtaining
securities prices for valuation purposes, expenses of preparing
and printing and distributing prospectuses, auditing and legal
expenses, expenses of reports to Shareholders, expenses of
meetings of Shareholders and proxy solicitations therefor,
insurance expense, association membership dues and such non-
recurring items as may arise, including costs and expenses of
litigation to which the Trust is a party, and for all losses and
liabilities by them incurred in administering the Trust, provided
--------
that expenses, disbursements, losses and liabilities incurred in
connection with classes of Shares having the same alphabetical
designation or in connection with the management of the assets
-18-
belonging to such classes shall be payable solely out of the
assets belonging to such classes, and provided further that the
-------- -------
Trustees shall have a lien on the Trust Property prior to any
rights or interests of the Shareholders thereto for the payment
of any expenses, disbursements, losses and liabilities of the
Trust.
6.10 Power to Carry Out Trust's Purposes; Presumptions. The
-------------------------------------------------
Trustees shall have power to carry out any and all acts
consistent with the Trust's purposes through branches and offices
both within and without the Commonwealth of Massachusetts, in any
and all states of the United States of America, in the District
of Columbia, and in any and all commonwealths, territories,
dependencies, possessions, agencies or instrumentalities of the
United States of America and of foreign governments, and to do
all such other things and execute all such instruments as they
deem necessary, proper or desirable in order to promote the
interests of the Trust although such things are not herein
specifically mentioned. Any determination as to what is in the
interests of the Trust made by the Trustees in good faith shall
be conclusive. In construing the provisions of this Declaration,
the presumption shall be in favor of a grant of power to the
Trustees. The enumeration of any specific power herein shall not
be construed as limiting the aforesaid power. The Trustees shall
not be required to obtain any court order to deal with the Trust
Property.
6.11 Determinations by Trustees. Any determination made in
--------------------------
good faith and, so far as accounting matters are involved in
accordance with generally accepted accounting principles, by or
pursuant to the direction of the Trustees as to the amount and
value of assets, obligations or liabilities of the Trust or any
class of Shares, as to the amount of net income of the Trust or
any class of Shares from dividends and interest for any period or
amounts at any time legally available for the payment of
dividends, as to the amount of any reserves or charges set up and
the propriety thereof, as to the time of or purpose for creating
reserves or as to the use, alteration or cancellation of any
reserves or charges (whether or not any obligation or liability
for which such reserves or charges shall have been created shall
have been paid or discharged or shall be then or thereafter
required to be paid or discharged), as to the value of any
security owned by the Trust or any class of Shares, as to the
allocation of any assets or liabilities to a class or classes of
Shares, as to the times at which Shares of any class shall be
deemed to be outstanding or no longer outstanding, or as to any
other matters relating to the issuance, sale, redemption or other
acquisition or disposition of securities or Shares, and any
reasonable determination made in good faith by the Trustees as to
whether any transaction constitutes a purchase of securities on
"margin," a sale of securities "short," or any underwriting of
the sale of, or a participation in any underwriting or selling
-19-
group in connection with the public distribution of, any
securities, shall be final and conclusive, and shall be binding
upon the Trust and all Shareholders, past, present and future,
and Shares are issued and sold on the condition and
understanding, evidenced by the purchase of Shares or acceptance
of Share certificates, that any and all such determinations shall
be binding as aforesaid.
6.12 Service in Other Capacities. Any Trustee,
---------------------------
representative, employee or agent of the Trust, including any
investment adviser, transfer agent, administrator, distributor,
custodian or underwriter for the Trust, may serve in any other
capacity on his or its own behalf or on behalf of others, and may
engage in other business activities in addition to his or its
services on behalf of the Trust, provided that such other
--------
activities do not materially interfere with the performance of
his or its duties for or on behalf of the Trust.
VII.
AGREEMENTS WITH INVESTMENT ADVISER,
PRINCIPAL UNDERWRITER, ADMINISTRATOR,
TRANSFER AGENT, CUSTODIAN AND OTHERS
7.1 Investment Adviser. The Trustees may, on such terms
------------------
and conditions as they may in their discretion determine, enter
into a written investment advisory agreement or agreements with
any Person or Persons providing for portfolio management,
investment advisory, statistical and research facilities and
other services pertaining to the assets belonging to one or more
classes of Shares. Notwithstanding any other provision hereof,
the Trustees may authorize such an investment adviser (subject to
such general or specific instructions as the Trustees may adopt)
to effect purchases, sales or exchanges of portfolio securities
of such class(es) on behalf of the Trustees and to determine the
net asset value and net income of such class(es) or may authorize
any representative or Trustee to effect such purchases, sales or
exchanges pursuant to the recommendations of such investment
adviser (all without further action by the Trustees). Any such
purchases, sales and exchanges so affected shall be deemed to
have been authorized by all of the Trustees.
7.2 Administrator. The Trustees may, on such terms and
-------------
conditions as they may in their discretion determine, enter into
one or more agreements with any Person or Persons providing for
administrative services to one or more classes of Shares,
including assistance in supervising the affairs of such class(es)
and performance of administrative, clerical and other services
considered desirable by the Trustees.
-20-
7.3 Principal Underwriter. The Trustees may, on such terms
---------------------
and conditions as they may in their discretion determine, enter
into one or more distribution agreements with any Person or
Persons providing for sale of Shares of one or more classes at a
price at least equal to the net asset value per Share of such
class(es) and providing for sale of the Shares of such class(es)
pursuant to arrangements by which the Trust may either agree to
sell the Shares of such class(es) to the other party to the
agreement or appoint such other party its sales agent for such
Shares. Such agreement(s) may also provide for the repurchase of
Shares of such class(es) by such other party as principal or as
agent of the Trust, and may authorize the other party to enter
into agreements with others for the purpose of the distribution
or repurchase of Shares of such class(es).
7.4 Transfer Agent. The Trustees may, on such terms and
--------------
conditions as they may in their discretion determine, enter into
one or more agreements with any Person or Persons providing for
transfer agency and other services to Shareholders of any class.
7.5 Custodian. The Trustees may, on such terms and
---------
conditions as they may in their discretion determine, enter into
one or more agreements with any Person or Persons providing for
the custody and safekeeping of the property of the Trust or any
class of Shares.
7.6 Service and Distribution Plans. The Trustees may, on
------------------------------
such terms and conditions as they may in their discretion
determine, adopt one or more plans pursuant to which Persons may
be compensated directly or indirectly by the Trust for
Shareholder servicing, administration or distribution with
respect to one or more classes of Shares, including without
limitation plans subject to Rule 12b-1 under the Act, and the
Trustees may enter into agreements pursuant to such plans.
7.7 Parties to Agreements. The same Person may be employed
---------------------
in multiple capacities under Sections 7.1 through 7.6 of this
Article VII and may receive compensation in as many capacities as
such Person serves. The Trustees may enter into any agreement of
the character described in this Article VII, or any other
agreement necessary or appropriate to the conduct of the business
of the Trust or any class of Shares, with any Person, including
any Person in which any Trustee, representative, employee or
Shareholder of the Trust may be interested, and no such agreement
shall be invalidated or rendered voidable by reason of the
existence of any such relationship, nor shall any Person holding
such relationship be liable by reason of such relationship for
any loss or expense to the Trust under or by reason of said
agreement or accountable for any profit realized directly or
indirectly therefrom.
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VIII.
SHAREHOLDERS' VOTING POWERS AND MEETINGS
8.1 Voting Powers. The Shareholders shall have power to
-------------
vote (a) for the election of Trustees as provided in Section 6.2
hereof, (b) to the same extent as the shareholders of a
Massachusetts business corporation when considering whether 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, (c) with respect to any of the matters
and to the extent provided in Article X hereof, (d) with respect
to such additional matters relating to the Trust as may be
required by law, by this Declaration of Trust, by the Regulations
of the Trust, by any requirement applicable to or agreement of
the Trust, or as the Trustees may consider desirable. Every
Shareholder of record shall have the right to one vote for every
whole Share (other than Shares held in the treasury of the Trust)
standing in his name on the books of the Trust, and to a
proportional fractional vote for any fractional Share, as to any
matter on which the Shareholder is entitled to vote. There shall
be no cumulative voting. Shares may be voted in person or by
proxy. Until Shares are issued, the Trustees may exercise all
rights of Shareholders and may take any action required or
permitted to be taken by Shareholders by law, this Declaration of
Trust or the Regulations.
8.2 Meetings. Meetings of Shareholders may be called by
--------
the Trustees as provided in the Regulations and shall be called
by the Trustees upon the written request of Shareholders owning
at least ten percent (10%) of the outstanding Shares entitled to
vote.
8.3 Quorum and Required Vote. The presence, in person or
------------------------
by proxy, of Shareholders entitled to cast at least a majority of
the votes which all Shareholders are entitled to cast on the
particular matter shall constitute a quorum for the purpose of
considering such matter. Action may be taken on all matters for
which a quorum exists, irrespective of the absence of a quorum on
other matters. If a meeting cannot be organized with respect to
a particular matter because a quorum for that matter has not
attended, those present and entitled to vote on such matter may
adjourn the meeting to such reasonable time and place as they may
determine.
On any matter submitted to a vote of Shareholders, Shares
with different alphabetical class designations that are then
issued and outstanding and entitled to vote shall be voted in the
aggregate and not by class except: (1) as otherwise required by
applicable law or permitted by the Board of Trustees of the
Trust, or (2) when the matter, as conclusively determined by the
Trustees, affects only the interests of the Shareholders of a
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class or classes with a particular alphabetical designation (in
which case only Shareholders of the affected class or classes
shall be entitled to vote thereon).
Each Share of classes having the same alphabetical
designation shall vote together in the aggregate and not by class
on all matters submitted to a vote of the Shareholders of such
classes, except that:
(1) on any matter that pertains to the agreements or
expenses and liabilities described in subsection B(3)(a) of
Section 5.1 hereof (or to any plan or other document adopted by
the Trust relating to said agreements, expenses or liabilities)
and is submitted to a vote of Shareholders of the Trust, only the
particular class of Shares specified therein shall be entitled to
vote, except that: (i) if said matter affects Shares in the Trust
other than such class of Shares, such other affected Shares in
the Trust shall also be entitled to vote, and in such case the
particular class of Shares so specified shall be voted in the
aggregate together with such other affected Shares and not by
class except where otherwise required by law or permitted by the
Board of Trustees of the Trust; and (ii) if said matter does not
affect the particular class of Shares specified therein, said
class of Shares shall not be entitled to vote (except where
required by law or permitted by the Board of Trustees) even
though the matter is submitted to a vote of the holders of Shares
in the Trust other than Shares of such class; and
(2) on any matter that pertains to the agreements or
expenses and liabilities described in subsection B(3)(b) of
Section 5.1 hereof (or any plan or other document adopted by the
Trust relating to said agreements, expenses or liabilities) and
is submitted to a vote of Shareholders of the Trust, the
particular class of Shares specified therein shall not be
entitled to vote, except where otherwise required by law or
permitted by the Board of Trustees of the Trust, and except that
if said matter affects such class of Shares, such class of Shares
shall be entitled to vote, and in such case shall be voted in the
aggregate together with all other Shares in the Trust voting on
the matter and not by class except where otherwise required by
law or permitted by the Board of Trustees.
Subject to any applicable requirements of law or of this
Declaration of Trust or the Regulations: (a) the acts, at any
duly organized meeting, of the Shareholders present, in person or
by proxy, entitled to cast at least a majority of the votes which
all Shareholders present are entitled to cast on the particular
matter shall be the acts of the Shareholders with respect to that
matter; and (b) in the election of Trustees, a plurality of the
Shares voting shall elect a Trustee.
-23-
8.4 Shareholder Action by Written Consent. Any action
-------------------------------------
which may be taken by Shareholders may be taken without a meeting
if not less than a majority of the Shareholders entitled to vote
on the matter consent to the action in writing and the written
consents are filed with the records of the meetings of
Shareholders. Such consent shall be treated for all purposes as
a vote taken at a meeting of Shareholders.
8.5 Code of Regulations. The Regulations may include
-------------------
further provisions not inconsistent with this Declaration of
Trust for meetings of Shareholders, votes, record dates, notices
of meetings and related matters.
IX.
LIMITATIONS OF LIABILITY AND INDEMNIFICATION
9.1 Liabilities of Classes. Liabilities belonging to
----------------------
classes of Shares with the same alphabetical designation,
including, without limitation, expenses, fees, charges, taxes,
and liabilities incurred or arising in connection with such
classes, or in connection with the management thereof, shall be
paid only from the assets belonging to such classes.
9.2 Limitation of Trustee Liability. Every act or thing
-------------------------------
done or omitted, and every power exercised or obligation incurred
by the Trustees or any of them in the administration of this
Trust or in connection with any affairs, property or concerns of
the Trust, whether ostensibly in their own names or in their
Trust capacity, shall be done, omitted, exercised or incurred by
them as Trustees and not as individuals. Every person
contracting or dealing with the Trustees or having any debt,
claim or judgment against them or any of them shall look only to
the funds and property of the Trust for payment or satisfaction.
No Trustee or Trustees of the Trust shall ever be personally
liable for or on account of any contract, debt, tort, claim,
damage, judgment or decree arising out of or connected with the
administration or preservation of the Trust Property or the
conduct of any of the affairs of the Trust. Every note, bond,
contract, order or other undertaking issued by the Trust or the
Trustees relating to the Trust, and stationery used by the Trust
shall include the notice set forth in Section 9.5 of this
Article IX (but the omission thereof shall not be construed as a
waiver of the foregoing provision, and shall not render the
Trustees personally liable).
It is the intention of this Section 9.2 that no Trustee
shall be subject to any personal liability whatsoever to any
person for any action or failure to act (including without
limitation the failure to compel in any way any former or acting
Trustee to redress any breach of trust) except that nothing in
-24-
this Declaration of Trust shall protect any Trustee from any
liability to the Trust or its Shareholders to which he would
otherwise be subject by reason of willful misfeasance, bad faith
or gross negligence in the performance of his duties, or by
reason of reckless disregard of his obligations and duties as
Trustee; and that all persons shall look solely to the Trust
Property belonging to a class of Shares for satisfaction of
claims of any nature arising in connection with the affairs of
such class of the Trust.
9.3 Indemnification of Trustees, Representatives and
------------------------------------------------
Employees. The Trust shall indemnify each of its Trustees
---------
against all liabilities and expenses (including amounts paid in
satisfaction of judgments, in compromise, as fines and penalties,
and as counsel fees) reasonably incurred by him in connection
with the defense or disposition of any action, suit or other
proceeding, whether civil or criminal, in which he may be
involved or with which he may be threatened, while as a Trustee
or thereafter, by reason of his being or having been such a
Trustee except with respect to any matter as to which he shall
------
have been adjudicated to have acted in bad faith, willful
misfeasance, gross negligence or reckless disregard of his
duties, provided that as to any matter disposed of by a
--------
compromise payment by such person, pursuant to a consent decree
or otherwise, no indemnification either for said payment or for
any other expenses shall be provided unless the Trust shall have
received a written opinion from independent legal counsel
approved by the Trustees to the effect that if either the matter
of willful misfeasance, gross negligence or reckless disregard of
duty, or the matter of bad faith had been adjudicated, it would
in the opinion of such counsel have been adjudicated in favor of
such person. The rights accruing to any person under these
provisions shall not exclude any other right to which he may be
lawfully entitled, provided that no person may satisfy any right
--------
of indemnity or reimbursement hereunder except out of the
property of the Trust. The Trustees may make advance payments in
connection with the indemnification under this Section 9.3,
provided that the indemnified person shall have given a written
--------
undertaking to reimburse the Trust in the event it is
subsequently determined that he is not entitled to such
indemnification.
The Trustees shall have the power to indemnify
representatives and employees of the Trust to the same extent
that Trustees are entitled to indemnification pursuant to this
Section 9.3.
9.4 Reliance on Experts, etc. Each Trustee and
------------------------
representative of the Trust shall, in the performance of his
duties, be fully and completely justified and protected with
regard to any act or any failure to act resulting from reliance
in good faith upon the books of account or other records of the
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Trust, upon an opinion of counsel satisfactory to the Trust, or
upon reports made to the Trust by any of its representatives or
employees or by the investment adviser, the principal
underwriter, selected dealers, accountants, appraisers or other
experts or consultants selected with reasonable care by the
Trustees or representatives of the Trust, regardless of whether
such counsel or expert may also be a Trustee.
9.5 Limitation of Shareholder Liability. Shareholders
-----------------------------------
shall not be subject to any personal liability in connection with
the assets of the Trust for the acts or obligations of the Trust.
The Trustees shall have no power to bind any Shareholder
personally or 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 by way of
subscription to any Shares or otherwise. Every obligation, contract,
instrument, certificate for Shares or any other security of any class
of the Trust or undertaking, and every other act whatsoever executed
in connection with the Trust or any class of Shares shall be
conclusively presumed to have been executed or done by the
executors thereof only in their capacities as Trustees under the
Declaration of Trust or in their capacity as officers, employees
or agents of the Trust and not individually. Every note, bond,
contract, order or other undertaking issued by or on behalf of
the Trust or the Trustees relating to the Trust or any class of
Shares, and the stationery used by the Trust, shall include a
recitation limiting the obligation represented thereby to the
Trust and its assets (but the omission of such a recitation shall
not operate to bind any Shareholder), as follows:
"The names 'CFB MarketWatch Funds' and 'Trustees of CFB
MarketWatch Funds' refer respectively to the Trust
created and the Trustees, as trustees but not
individually or personally, acting from time to time
under a Declaration of Trust dated June 4, 1992 which
is hereby referred to and a copy of which is on file at
the office of the State Secretary of The Commonwealth
of Massachusetts and at the principal office of the
Trust. The obligations of 'CFB MarketWatch Funds'
entered into in the name or on behalf thereof by any of
the Trustees, representatives or agents are made not
individually, but in such capacities, and are not
binding upon any of the Trustees, Shareholders or
representatives of the Trust personally, but bind only
the Trust Property, and all persons dealing with any
class of shares of the Trust must look solely to the
Trust Property belonging to such class for the
enforcement of any claims against the Trust."
The rights accruing to a Shareholder under this Section 9.5
shall not exclude any other right to which such Shareholder may
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be lawfully entitled, nor shall anything herein contained
restrict the right of the Trust to indemnify or reimburse a
Shareholder in any appropriate situation even though not
specifically provided for herein, provided that a Shareholder of
--------
any class of Shares shall be indemnified only from assets
belonging to the classes of Shares with the same alphabetical
designation.
9.6 Indemnification of Shareholders. In case any
-------------------------------
Shareholder or former Shareholder shall be held to be personally
liable solely by reason of his being or having been a Shareholder
and not because of his acts or omissions or for some other
reason, 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 belonging
to the classes of Shares with the same alphabetical designation
as that of the Shares owned by such Shareholder to be held
harmless from and indemnified against all loss and expense
arising from such liability. The Trust shall, upon request by
the Shareholder, assume the defense of any claim made against any
Shareholder for any act or obligations of the Trust and satisfy
any judgment thereon from such assets.
X.
MISCELLANEOUS
10.1 Trust Not a Partnership. It is hereby expressly
-----------------------
declared that a Massachusetts business trust with transferable
Shares and not a partnership, joint venture, corporation, joint
stock company or any form of legal relationship other than a
trust is created hereby. Nothing herein shall be construed to
make the Shareholders, either by themselves or with the Trustees,
partners or members of a joint stock association. No Trustee
hereunder shall have any power to bind personally either a
representative of the Trust or any Shareholder. All persons
extending credit to, contracting with or having any claim against
the Trust or the Trustees shall look only to the assets of the
Trust for payment under such credit, contract or claim; and
neither the Shareholders nor the Trustees, whether past, present
or future, shall be personally liable therefor.
10.2 No Bond or Surety. The Trustees shall not be required
-----------------
to give any bond as such, nor any surety if a bond is required.
10.3 Duration of Trust. This Trust shall continue without
-----------------
limitation of time, provided that the Trust or any class of
--------
Shares may be terminated at any time in accordance with the
provisions of this Declaration of Trust and applicable law.
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10.4 Merger, Consolidation and Sale of Assets. The Trust
----------------------------------------
may merge into or consolidate with any other corporation,
association, trust or other organization or may sell, lease or
exchange all or substantially all of the Trust Property,
including its good will, upon such terms and conditions and for
such consideration when and as authorized by vote or written
consent of the Trustees and approved by the affirmative vote of
the holders of not less than a majority of the Shares outstanding
and entitled to vote, voting in the aggregate and not by class
except to the extent that applicable law may require voting by
class, or by an instrument or instruments in writing without a
meeting consented to by the holders of not less than a majority
of such Shares, voting in the aggregate and not by class except
to the extent that applicable law may require voting by class.
10.5 Incorporation. With the approval of the holders of a
-------------
majority of the outstanding Shares, voting in the aggregate and
not by class except to the extent that applicable law may require
voting by class, the Trustees may cause to be organized, or
assist in organizing, a corporation or corporations under the law
of any jurisdiction, to carry on any affairs in which the Trust
shall directly or indirectly have any interest, and to transfer
the Trust Property to any such Person in exchange for any Shares
or securities thereof or otherwise, and to lend money, to
subscribe for the Shares or securities of, and enter into any
contracts with any such Person in which the Trust holds or is
about to acquire securities or any other interest. The Trustees
may also cause a merger or consolidation between the Trust or any
successor thereto and any such Person if and to the extent
permitted by law. Nothing contained herein shall be construed as
requiring approval of Shareholders for the Trustees to organize
or assist in organizing one or more corporations, trusts,
partnerships associations or the organizations and selling,
conveying or transferring a portion of the Trust Property to such
Person(s).
10.6 Filing of Copies, References, Headings. The original
--------------------------------------
instrument of this Declaration of Trust and of each amendment
hereto shall be filed with the State Secretary of the
Commonwealth of Massachusetts as provided by law and copies
thereof shall be kept at the office of the Trust where they may
be inspected by any Shareholder. Each amendment so filed shall
be accompanied by a certificate signed and acknowledged by a
Trustee or by the Secretary or any Assistant Secretary of the
Trust stating that such action was duly taken in the manner
provided herein, and unless such amendment or such certificate
sets forth some later time for the effectiveness of such
amendment, such amendment shall be effective upon its filing. A
restated Declaration Trust, integrating into a single instrument
all of the provisions of the Declaration of Trust that are then
in effect and operative, may be executed from time to time by a
majority of the Trustees and shall, upon filing with the State
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Secretary of the Commonwealth of Massachusetts, be conclusive
evidence of all amendments contained therein and may thereafter
be referred to in lieu of the initial Declaration of Trust and
the various amendments thereto. Anyone dealing with the Trust
may rely on a certificate by a representative of the Trust as to
whether or not any such amendment hereto may have been made and
as to any matters in connection with the Trust hereunder, with
the same effect as if it were the original, and may rely on a
copy certified by a representative of the Trust to be a copy of
this instrument or of any amendment thereto. Headings are placed
herein for convenience of reference only and, in the case of any
conflict, the text of this instrument, rather than the headings,
shall control. This instrument may be executed in any number of
counterparts each of which shall be deemed an original. All
signatures to this instrument need not appear on the same page.
10.7 Applicable Law. The Trust set forth in this instrument
--------------
is a trust made in the Commonwealth of Massachusetts and is to be
governed by and construed and administered according the laws of
said Commonwealth.
10.8 Provisions in Conflict With Law or Regulations.
----------------------------------------------
A. No provision of this Declaration of Trust shall be
effective to:
(1) Require a waiver of compliance with any
provision of the Securities Act of 1933, as amended, or the Act,
or of any valid rule, regulation or order of the Securities and
Exchange Commission thereunder; or
(2) Protect or purport to protect any Trustee or
officer of the Trust against any liability to the Trust or its
Shareholders to which he 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 office.
B. The provisions of this Declaration of Trust are
severable, and if the Trustees shall determine with the advice of
counsel that any of such provisions is in conflict with the Act,
the regulated investment company provisions of the Internal
Revenue Code, Chapter 182 of the General Laws of the Commonwealth
of Massachusetts or with any other applicable law or regulation,
then in such event the conflicting provision shall be deemed
never to have constituted a part of this Declaration of Trust,
provided that such determination shall not affect any of the
--------
remaining provisions of this Declaration of Trust or render
invalid or improper any action taken or omitted prior to such
determination.
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C. If any provision of this Declaration of Trust
shall be held invalid or unenforceable in any jurisdiction, such
invalidity or unenforceability shall attach only to such
provision in such jurisdiction and shall not in any manner affect
such provision in any other jurisdiction or any other provision
of this Declaration of Trust in any jurisdiction.
10.9 Amendment of Declaration of Trust.
---------------------------------
A. This Declaration of Trust may be amended upon a
resolution to that effect being adopted by the Trustees and
approved by the affirmative vote of the holders of not less than
a majority of the outstanding Shares, voting in the aggregate and
not by class except to the extent that applicable law may require
voting by class.
B. Notwithstanding any other provision hereof, until
such time as a Registration Statement under the Securities Act of
1933, as amended, covering the first public offering of
securities of the Trust shall have become effective, this
Declaration of Trust may be terminated or amended in any respect
by the affirmative vote of a majority of the Trustees.
C. The Trustees may amend this Declaration of Trust
without a vote of Shareholders to change the name of the Trust or
to cure any error or ambiguity or if they deem it necessary to
conform this Declaration of Trust to the requirements of
applicable state or federal laws or regulations, including
without limitation the requirements of the regulated investment
company provisions of the Internal Revenue Code, but the Trustees
shall not be liable for failing so to do.
D. Notwithstanding any other provision hereof, this
Declaration of Trust may not be amended in any manner whatsoever
that would impair the exemption from personal liability of the
Trustees and Shareholders of the Trust or that would permit an
assessment upon any Shareholder.
IN WITNESS WHEREOF, the undersigned have executed this
Agreement and Declaration of Trust in the capacities indicated,
as of this 4th day of June, 1992.
/s/▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
---------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, Settlor
/s/▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------
▇▇▇▇ ▇. ▇▇▇▇▇, Initial Trustee
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇
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