U.S. GLOBAL ACCOLADE FUNDS
SECOND AMENDED AND RESTATED
MASTER TRUST AGREEMENT
AUGUST 16, 2000
U.S. GLOBAL ACCOLADE FUNDS
SECOND AMENDED AND RESTATED
MASTER TRUST AGREEMENT
PAGE
DECLARATIONS .........................................................1
ARTICLE I NAME AND DEFINITIONS
Section 1.1 Name and Principal Office..................................1
Section 1.2 Definitions................................................1
(a) "By-Laws".........................................1
(b) "1940 Act"........................................1
(c) "Commission"......................................1
(d) "Series"..........................................1
(e) "Shareholder".....................................1
(f) "Shares"..........................................1
(g) "Trust"...........................................2
(h) "Agreement".......................................2
(i) "Trustees"........................................2
(j) "Class"...........................................2
ARTICLE II PURPOSE OF TRUST...........................................2
ARTICLE III THE TRUSTEES
Section 3.1 Appointment, Election, Removal, etc........................2
(a) Trustees..........................................2
(b) Number............................................2
(c) Election .........................................2
(d) Term..............................................3
(e) Vacancies.........................................3
(f) Resignation.......................................3
(g) Removal...........................................3
(h) Effect of Death, Resignation, etc.................3
(i) No Accounting.....................................3
Section 3.2 Powers of Trustees.........................................3
(a) Investments.......................................4
(b) Disposition of Assets.............................4
(c) Ownership Powers..................................4
(d) Subscription......................................4
(e) Form of Holding...................................4
(f) Reorganization, etc...............................4
(g) Voting Trusts, etc................................4
(h) Compromise........................................4
(i) Associations, etc.................................4
(j) Borrowing and Security............................5
(k) Guarantees, etc...................................5
(l) Insurance.........................................5
(m) Vote Required, Place and Type of Meeting..........5
(n) Distribution Plans................................5
Section 3.3 Certain Contracts..........................................5
Section 3.4 Trust Expenses ............................................6
Section 3.5 Ownership of Assets of the Trust...........................6
ARTICLE IV SHARES/SUB-TRUSTS
Section 4.1 Description of Shares......................................6
Section 4.2 Establishment and Designation of Sub-Trust and Classes.....7
Section 4.3 Rights and Preferences of Sub-Trusts.......................7
(a) Assets Belonging to Sub-Trusts....................7
(b) Liabilities Belonging to Sub-Trusts...............8
(c) Determination of Treatment as Income and/or
Capital........................................8
(d) Dividends.........................................8
(e) Liquidation.......................................8
(f) Voting............................................9
(g) Redemption by Shareholder.........................9
(h) Redemption by Trust...............................9
(i) Net Asset Value...................................9
(j) Transfer.........................................10
(k) Equality.........................................10
(l) Fractions........................................10
(m) Conversion Rights................................10
(n) Class Differences................................10
Section 4.4 Ownership of Shares.......................................10
Section 4.5 Investments in the Trust..................................10
Section 4.6 No Preemptive Rights......................................10
Section 4.7 Status of Shares and Limitation of Personal Liability.....10
ARTICLE V SHAREHOLDERS' VOTING POWERS AND MEETINGS
Section 5.1 Voting Powers.............................................11
Section 5.2 Meetings and Notice.......................................11
Section 5.3 Record Dates..............................................12
Section 5.4 Quorum and Required Vote..................................12
Section 5.5 Action by Written Consent.................................12
Section 5.6 Inspection of Records.....................................12
Section 5.7 Additional Provisions.....................................12
Section 5.8 Shareholder Communications................................12
ARTICLE VI LIMITATION OF LIABILITY; INDEMNIFICATION
Section 6.1 Trustees, Shareholders, etc. Not Personally Liable;
Notice..................................................13
Section 6.2 Notice for Contracts......................................13
Section 6.3 Trustee's Good Faith Action; Expert Advice; No Bond ......13
Section 6.4 Indemnification of Shareholders...........................14
Section 6.5 Indemnification of Trustees, Officers, etc................15
Section 6.6 Compromise Payment........................................15
Section 6.7 Indemnification Not Exclusive, etc........................15
Section 6.8 Liability of Third Persons Dealing with Trustees..........15
ARTICLE VII MISCELLANEOUS
Section 7.1 Duration and Termination of Trust.........................15
Section 7.2 Reorganization............................................15
Section 7.3 Amendments ...............................................16
Section 7.4 Filing of Copies; References; Headings....................16
Section 7.5 Applicable Law............................................17
Section 7.6 Resident Agent............................................17
U.S. GLOBAL ACCOLADE FUNDS
SECOND AMENDED AND RESTATED
MASTER TRUST AGREEMENT
This AGREEMENT AND DECLARATION OF TRUST (Agreement) made at San
Antonio, Texas, the 15th day of April 1993, by the Trustees named under this
Agreement, and by the holders of shares of beneficial interest to be issued as
provided under this Agreement, is hereby amended and restated in its entirety
this 16th day of August 2000 in the City of San Antonio in the State of Texas,
as follows:
DECLARATIONS
WHEREAS, this Trust has been created to conduct the business of an
investment company;
WHEREAS, this Trust is authorized to issue, in accordance with the
provisions of this Agreement, its shares of beneficial interest in separate
series, with each separate series to be a Sub-Trust as described in this
Agreement; and
WHEREAS, the Trustees have agreed to manage the property received by
them as trustees of a Massachusetts business trust in accordance with the
provisions in this Agreement.
NOW, THEREFORE, the Trustees hereby declare that they will hold all
cash, securities and other assets which they may acquire (from time to time) as
Trustees under this Agreement IN TRUST to manage and dispose of the same upon
the following terms and conditions for the benefit of the holders from time to
time of shares of beneficial interest in this Trust or in Sub-Trusts created
under this Agreement as hereinafter set forth.
ARTICLE I
NAME AND DEFINITIONS
Section 1.1 NAME AND PRINCIPAL OFFICE. This Trust shall be known as
U.S. Global Accolade Funds and the Trustees will conduct the business of the
Trust under that name or any other name or names as they may from time to time
determine. The principal place of business of the Trust shall be ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ or at such other location as the Trustees may
from time to time determine.
Section 1.2 DEFINITIONS. Unless otherwise specifically stated, the
following terms shall mean:
(a) "By-Laws" shall mean the By-Laws of the Trust as amended from time
to time.
(b) The "1940 Act" refers to the Investment Company Act of 1940 and
regulations thereunder, all as amended from time to time;
(c) The term "Commission" shall have the meaning given it in the 1940
Act;
(d) "Series" refers to Series of Shares established and designated
under or in accordance with the provisions of Article IV, each of which Series
shall be a Sub-Trust of the Trust;
(e) "Shareholder" means a record owner of Shares;
(f) "Shares" refers to the transferable units of interest into which
the beneficial interest in the Trust and each Sub-Trust of the Trust (as the
context may require) shall be divided from time to time;
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(g) The "Trust" refers to the U.S. Global Accolade Funds business trust
established by this Agreement, as amended from time to time, inclusive of each
and every Sub-Trust established hereunder;
(h) "Agreement" shall mean this Agreement and Declaration of Trust as
amended or restated from time to time;
(i) "Trustees" refers to the Trustees of the Trust named herein or
elected in accordance with Article III; and
(j) "Class" refers to any class of Shares of any Series or Sub-Trust
established and designated under or in accordance with the provisions of Article
IV.
ARTICLE II
PURPOSE OF TRUST
The purpose of the Trust is to conduct the business of an investment
company, offering Shareholders of the Trust one or more investment programs; and
to engage in any business allowable under applicable law which the Trustees may
deem convenient or proper in furtherance of the Trust's business.
ARTICLE III
THE TRUSTEES
Section 3.1 APPOINTMENT, ELECTION, REMOVAL, ETC.
(a) TRUSTEES. The Trustees hereof are ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇; ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇; J. ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇; and
▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇., ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇.
(b) NUMBER. The Trustee(s) serving as such, whether named above or
hereafter appointed or elected, have the discretion to increase or decrease the
number of Trustees. No decrease in the number of Trustees may remove any Trustee
from office prior to the expiration of his term; however, a decrease in the
number of Trustees may coincide with the removal of a Trustee pursuant to
subsection (g) of this Section 3.1.
(c) ELECTION. The Shareholders shall elect the Trustees of the Trust.
Subject to Section 16(a) of the 1940 Act, the Trustees may elect their own
successors and may, pursuant to Section 3.1(e), appoint Trustees to fill
vacancies.
(d) TERM. Whether named above, appointed or elected pursuant to the
terms of this Agreement, a Trustee shall serve as trustee of the Trust and each
Sub-Trust hereunder for a period of six years or until termination of the Trust
or the Trustees' death, resignation or removal, whichever occurs first. This
provision shall not be construed to preclude re-election of a Trustee whose
terms is expiring.
(e) VACANCIES. Any vacancy resulting from death, resignation, removal
or any other means, including without limitation an increase in the number of
trustees by the other trustees, or any anticipated vacancy may (but need not
unless required by the ▇▇▇▇ ▇▇▇) be filled by a majority of the remaining
Trustees. Subject to the provisions of Section 16(a) of the 1940 Act, the
remaining Trustees, in their sole discretion, may appoint in
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writing a Trustee to fill a vacancy, and this appointment shall become effective
upon the written acceptance of such named person and his agreement to be bound
by the provisions of this Agreement. In the event of an appointment to fill an
anticipated vacancy, the appointment shall become effective at or after the date
the anticipated vacancy occurs. No further act is necessary for the Trust estate
to vest in the new Trustee once the appointment is effective.
(f) RESIGNATION. A Trustee may resign as a trustee by delivering to the
Trustees or any Trust officer a signed written document to that effect. The
effective date of such resignation will be the later of the date stated in the
document or the date of delivery of the document to the Trust at its principal
offices.
(g) REMOVAL. Any Trustee may be removed with or without cause at any
time either: (i) by a written document stating the effective date of the removal
and signed by at least two-thirds of the number of Trustees prior to such
removal; or (ii) by at least a two-thirds vote of the outstanding shares, with
such vote cast in person or by proxy at a meeting called for such purpose; or
(iii) by a written declaration signed by Shareholders owning at least two-thirds
of the outstanding shares and filed with the Trust's custodian.
(h) EFFECT OF DEATH, RESIGNATION, ETC. The death, resignation,
retirement, removal, or incapacity of one or more of the Trustees shall not
terminate the Trust or any Sub-Trust or revoke or terminate any existing agency
or contract created or entered into pursuant to the terms of this Agreement.
(i) NO ACCOUNTING. No persons or estate of such person who has ceased
acting as Trustee shall be required to make an accounting to the Trustees or
Shareholders unless required by the 1940 Act or justified by circumstances
calling for removal for cause.
Section 3.2 POWERS OF TRUSTEES. The Trustees may, in accordance with
this Trust Agreement, carry on the business of the Trust and shall have all the
powers necessary to conduct such business to carry out the purpose of the Trust.
The Trustees' powers include, but are not limited to:
adopting By-Laws consistent with the Trust Agreement which specify
procedures for conducting the daily business affairs of the Trust,
including the power to amend and repeal the By-Laws to the extent that
the By-Laws do not reserve that right to the Shareholders;
establish Sub-Trusts, each such Sub-Trust to operate as a separate and
distinct investment medium and with separately defined investment
objectives and policies;
establish, from time to time in accordance with the provisions of
Section 4.1 hereof, classes of Shares of any Series or Sub-Trust or
divide the Shares of any Series or Sub-Trust into classes;
elect and remove officers, appoint and terminate agents and
consultants, and hire and terminate employees, any one or more of the
foregoing of whom may be a Trustee, and provide for the compensation of
all of the foregoing;
appoint from their own number, and terminate, any one or more
committees consisting of two or more Trustees, including without
implied limitation an executive committee, which may, when the Trustees
are not in session and subject to the 1940 Act, exercise some or all of
the power and authority of the Trustees as the Trustees may determine;
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employ one or more Advisers, Administrators, Depositories and
Custodians, and authorize any Depository or Custodian to employ
subcustodians or agents and to deposit all or any part of such assets
in a system or systems for the central handling of securities and debt
instruments, retain transfer, dividend, accounting or Shareholder
servicing agents or any of the foregoing, provide for the distribution
of Shares by the Trust through one or more distributors, principal
underwriters or otherwise; and
in general, delegate to any officer of the Trust, to any committee of
the Trustees and to any employee, adviser, administrator, distributor,
depository, custodian, transfer and dividend disbursing agent, or any
other agent or consultant of the Trust such authority, powers,
functions and duties as they consider desirable or appropriate for the
conduct of the business and affairs of the Trust, including authority
to act in the name of the Trust and of the Trustees, to sign documents
and to act as attorney-in-fact for the Trustees.
Without limiting the foregoing, the Trustees, on behalf of the Trust,
shall, in accordance with the 1940 Act or other applicable law, have the
authority:
(a) INVESTMENTS. To invest cash and other property, and to hold cash or
other property uninvested without regard to the custom of investments by
trustees;
(b) DISPOSITION OF ASSETS. To sell, exchange, lend, pledge, mortgage,
write options on and lease any or all of the assets of the Trust;
(c) OWNERSHIP POWERS. To vote, or give assent to, or exercise any
rights of ownership, with respect to stock or other securities, debt instruments
or property; and to execute and deliver proxies or powers of attorney to such
person or persons as the Trustees shall deem proper;
(d) SUBSCRIPTION. To exercise powers and rights of subscription which
arise out of ownership of securities or debt instruments;
(e) FORM OF HOLDING. To hold any assets of the Trust in the name of the
Trust, Trustees, Sub-Trust, nominee or otherwise;
(f) REORGANIZATION, ETC. To consent to or participate in any plan for
the reorganization or consolidation of any corporation or issuer for which a
security or debt instrument is or was held in the Trust;
(g) VOTING TRUSTS, ETC. To join with other holders of any securities or
debt instruments in acting through a committee, depository, voting trustee or
otherwise, and in that connection to deposit any security or debt instrument
with, or transfer any security or debt instrument to the other holders or a
representative thereof and to delegate to them such power and authority with
regard to any security or debt instrument (whether or not so deposited or
transferred) as the Trustees shall deem proper, and to pay such portion of the
expenses and compensation of such representative as the Trustees shall deem
proper;
(h) COMPROMISE. To compromise or arbitrate claims (or any matter in
controversy) in favor of or against the Trust or any Sub-Trust;
(i) ASSOCIATIONS, ETC. To enter into joint ventures, general or limited
partnerships and any other combinations or associations;
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(j) BORROWING AND SECURITY. To borrow funds and to mortgage the assets
of the Trust to secure the obligations arising out of such borrowing;
(k) GUARANTEES, ETC. To make contracts of guaranty, endorse or
guarantee the payment of any obligations of any person, and to mortgage and
pledge any Trust property to secure any of or all such obligations;
(l) INSURANCE. To purchase and pay for entirely out of Trust property
such insurance as they may deem necessary or appropriate for the conduct of the
Trust's business including, without limitation, liability insurance for the
benefit of the Shareholders, Trustees, officers, employees, agents, consultants,
investment advisors, managers, administrators, distributors, principal
underwriters or independent contractors (or any person connected therewith);
(m) VOTE REQUIRED, PLACE AND TYPE OF MEETING. Except as otherwise
provided by the 1940 Act or other applicable law, this Agreement or the By-Laws,
any action to be taken by the Trustees on behalf of the Trust or any Sub-Trust
may be taken by a majority of the Trustees present at a meeting of Trustees (a
quorum, consisting of at least a majority of the Trustees then in office, being
present), within or without Massachusetts, including any meeting held by means
of a conference telephone or other communications equipment by means of which
all persons participating in the meeting can hear each other at the same time
and participation by such means shall constitute presence in person at a
meeting, or by written consents of a majority of the Trustees then in office (or
such larger or different number as may be required by the 1940 Act or other
applicable law); and
(n) DISTRIBUTION PLANS. To adopt on behalf of the Trust or any
Sub-Trust with respect to any class thereof a plan of distribution and related
agreements thereto pursuant to the terms of Rule 12b-1 and/or other provisions
of the 1940 Act and to make payments from the assets of the Trust or the
relevant Sub-Trust or Sub- Trusts pursuant to said Rule 12b-1 Plan.
Section 3.3 CERTAIN CONTRACTS. The Trustees may from time to time enter
into contracts with any type of organization or individual ("Contracting Party")
to provide services for the Trust. Any delegation of powers by the Trustees
shall not limit the generality of their powers and authority.
The fact that:
(i) any of the Shareholders, Trustees or officers of the Trust is a
shareholder, director, officer, partner, trustee, employee,
manager, adviser, principal underwriter or distributor or agent of
or for any Contracting Party, or of or for any parent or affiliate
of any contracting party or that the contracting party or any
parent or affiliate thereof is a Shareholder or has an interest in
the Trust or any Sub-Trust, or that
(ii) any Contracting Party may have a contract providing for the
rendering of any similar services to one or more other
corporations, trusts, associations, partnerships, limited
partnerships or other organizations, or have other business or
interests,
shall not affect the validity of any contract for the performance and assumption
of services, duties and responsibilities to, for or of the Trust or any
Sub-Trust and/or the Trustees or disqualify any Shareholder, Trustee or officer
of the Trust from voting upon or executing the same or create any liability or
accountability to the Trust, any Sub-Trust or its Shareholders, provided that in
the case of any relationship or interest referred to in the preceding clause (i)
on the part of any Trustee or officer of the Trust either (x) the material facts
as to such relationship or interest have been disclosed to or are known by the
Trustees not having any such
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relationship or interest and the contract involved is approved in good faith by
a majority of such Trustees not having any such relationship or interest (even
though such unrelated or disinterested Trustees are less than a quorum of all of
the Trustees), (y) the material facts as to such relationship or interest and as
to the contract have been disclosed to or are known by the Shareholders entitled
to vote thereon and the contract involved is specifically approved in good faith
by vote of the shareholders, or (z) the specific contract involved is fair to
the Trust as of the time it is authorized, approved or ratified by the Trustees
or by the Shareholders.
Section 3.4 TRUST EXPENSES. The Trustees are authorized to incur on
behalf of the Trust expenses which they deem necessary and proper to carry out
the business of the Trust. As an element of expenses, the Trustees are
authorized to determine, establish, and receive reasonable compensation for
their services as Trustees. The Trustees are authorized to pay all expenses from
either principal or income and may allocate expenses among the Sub-Trusts and/or
one or more classes of Shares thereof as the Trustees, in their discretion, deem
necessary and appropriate.
Section 3.5 OWNERSHIP OF ASSETS OF THE TRUST. Title to all of the Trust
assets shall at all times be considered as vested in the Trustees.
ARTICLE IV
SHARES/SUB-TRUSTS
Section 4.1 DESCRIPTION OF SHARES. The beneficial interest in the Trust
shall consist of one class of no- par Shares; however, the Trustees have
authority to divide the class of Shares into Series of Shares, each of which
Series of Shares shall be a separate and distinct Sub-Trust of the Trust, as
they deem necessary or desirable. Each Sub-Trust of Shares established will be
deemed to be a separate Trust under Massachusetts General Laws Chapter 182. The
Trustees shall have exclusive powers without Shareholder approval to establish
any Sub-Trust and to determine the relative rights and preferences between the
Shares of the separate Sub- Trusts as to right of redemption and the price,
terms and manner of redemption, special and relative rights as to dividends and
other distributions and on liquidation, sinking or purchase fund provisions,
conversion rights, and conditions under which the several Sub-Trusts shall have
separate voting rights or no voting rights.
In addition, the Trustees shall have exclusive power, without the
requirement of Shareholder approval, to issue classes of Shares of any Sub-Trust
or divide the Shares of any Sub-Trust into classes, each class having such
difference dividend, liquidation, voting and other rights as the Trustees may
determine, and may establish and designate the specific classes of Shares of
each Sub-Trust. The fact that a Sub-Trust shall have initially been established
and designated without any specific establishment or designation or classes
(i.e., that all Shares of such Sub-Trust are initially of a single class), or
that a Sub-Trust shall have more than one established and designated class,
shall not limit the authority of the Trustees to establish and designate
separate classes, or one or more further classes, of said Sub-Trust without
approval of the holders of the initial class thereof, or previously established
and designated class or classes thereof, provided that the establishment and
designation of such further separate classes would not adversely affect the
rights of the holders of the initial or previously established and designated
class or classes.
The number of authorized Shares and the number of Shares of each
Sub-Trust or class thereof that may be issued is unlimited, and the Trustees may
issue Shares of any Sub-Trust or class thereof for such consideration and on
such terms as they may determine (or for no consideration if pursuant to a Share
dividend or split-up), all without action or approval of the Shareholders. All
Shares when so issued on the terms determined by the Trustees shall be fully
paid and nonassessable (but may be subject to mandatory contribution
Page 6 of 18
SECOND AMENDED AND RESTATED MASTER TRUST AGREEMENT
back to the Trust as provided in Subsection (h) of Section 4.3). The Trustees
may classify or reclassify any unissued Shares or any Shares previously issued
and reacquired of any Sub-Trust or class thereof into one or more Sub-Trusts or
classes thereof that may be established and designated from time to time. The
Trustees may hold as treasury Shares, reissue for such consideration and on such
terms as they may determine, or cancel, at their discretion from time to time,
any Shares of any Sub-Trust or class thereof reacquired by the Trust.
The Trustees may, at any time, abolish a Sub-Trust if no Shares of that
Sub-Trust are outstanding.
The Trustees may from time to time close the transfer books or
establish record dates and times for the purposes of determining the holders of
Shares entitled to be treated as such, to the extent provided or referred to in
Section 5.3.
The establishment and designation of any Sub-Trust or of any class of
Shares of any Sub-Trust in addition to those established and designated in
Section 4.2 shall be effective upon the vote of a majority of the Trustees
setting forth such establishment and designation and the relative rights and
preferences of the Shares of such Sub-Trust or class, or as otherwise provided
in such instrument. At any time that there are NO Shares outstanding of any
particular Sub-Trust or class previously established and designated, the
Trustees may by vote of a majority of their number (or by an instrument executed
by an officer of the Trust pursuant to the vote of a majority of the Trustees)
abolish that Sub-Trust or class and the establishment and designation thereof.
Each vote referred to in this paragraph shall be implemented by preparation and
filing of an amendment to this Agreement.
Any Trustee, officer or other agent of the Trust, and any organization
in which any such person is interested may acquire, own, hold and dispose of
Shares of any Sub-Trust (including any classes thereof) of the Trust to the same
extent as if such person were not a Trustee, officer or other agent of the
Trust; and the Trust may issue and sell or cause to be issued and sold and may
purchase Shares of any Sub-Trust (including any classes thereof from any such
person or any such organization subject only to the general limitations,
restrictions or other provisions applicable to the sale or purchase of Shares of
such Sub-Trust (including any classes thereof) generally.
Section 4.2 ESTABLISHMENT AND DESIGNATION OF SUB-TRUSTS. Without
limiting the Trustees' authority to establish further Sub-Trusts pursuant to
Section 4.1, the Trustees hereby establish the following Sub-Trusts: Bonnel
Growth Fund; MegaTrends Fund; and Regent Eastern European Fund.
Section 4.3 RIGHTS AND PREFERENCES OF SUB-TRUSTS. Unless otherwise
specified by the Trustees, the Sub- Trusts established above and all future
Sub-Trusts or any classes thereof have the following rights and preferences:
(a) ASSETS BELONGING TO SUB-TRUSTS. All consideration received by the
Trust for the issue or sale of Shares of a particular Sub-Trust or any classes
thereof, all assets in which the consideration is invested, and proceeds from
the sale, exchange or liquidation thereof, all income earnings, profits and
proceeds from those assets and any items allocated to the Sub-Trust or class
thereof by the Trustees shall be held in trust by the Trustees for the benefit
of the Shareholders of that Sub-Trust or class thereof, shall irrevocably belong
to that Sub-Trust (and be allocable to any classes thereof), and shall be
recorded on the books of account of the Trust as assets belonging to that
Sub-Trust. The Trustees may, in a manner they deem fair and equitable, allocate
among the Sub-Trusts any items which are not readily identifiable to any one
particular Sub-Trust (and allocable to any classes thereof). Each allocation
shall be binding upon the Shareholders of the Trust.
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(b) LIABILITIES BELONGING TO SUB-TRUSTS. The liabilities belonging to a
Sub-Trust shall include all liabilities associated with the assets of that
particular Sub-Trust, all expenses and charges attributable to that Sub-Trust
and any general liabilities which are not readily identifiable and which the
Trustees may allocate in a manner they deem fair and equitable to that
Sub-Trust. In addition, the liabilities in respect of a particular class of
Shares of a particular Sub-Trust and all expenses, costs, charges and reserves
belonging to that class of Shares, and any general liabilities, expenses, costs,
charges or reserves of that particular Sub-Trust which are not readily
identifiable as belonging to any particular class of Shares of that Sub-Trust
shall be allocated and charged by the Trustees to and among any one or more of
the classes of Shares of that Sub-Trust established and designated from time to
time in such manner and on such basis as the Trustees in their sole discretion
deem fair and equitable. Each allocation shall be binding upon the Shareholders
of the Trust. Only the assets of a particular Sub-Trust (including any classes
thereof) may be used to satisfy a creditor of that Sub- Trust.
(c) DETERMINATION OF TREATMENT AS INCOME AND/OR CAPITAL. Except as
otherwise provided by the 1940 Act, the Trustees shall have full discretion to
determine which items shall be treated as income and which items as capital; and
each such determination and allocation shall be conclusive and binding upon the
Shareholders.
(d) DIVIDENDS. Dividends and distributions on Shares of a particular
Sub-Trust or any class thereof may be paid with such frequency as the Trustees
may determine, which may be daily or otherwise pursuant to a standing resolution
or resolutions adopted only once or with such frequency as the Trustees may
determine, to the holders of Shares of that Sub-Trust or class, from such of the
income and capital gains, accrued or realized, from the assets belonging to that
Sub-Trust, or in the case of a class, belonging to that Sub-Trust and allocable
to that class, as the Trustees may determine, after providing for actual and
accrued liabilities belonging to that Sub-Trust or class. All dividends and
distributions on Shares of a particular Sub-Trust or class thereof shall be
distributed pro rata to the holders of Shares of that Sub-Trust or class in
proportion to the number of Shares of that Sub-Trust held by such holders at the
date and time of record established for the payment of such dividends or
distributions, except that in connection with any dividend or distribution
program or procedure the Trustees may determine that no dividend or distribution
shall be payable on Shares as to which the Shareholder's purchase order and/or
payment have not been received by the time or times established by the Trustees
under such program or procedure. Such dividends and distributions may be made in
cash or Shares of that Sub-Trust or class or a combination thereof as determined
by the Trustees or pursuant to any program that the Trustees may have in effect
at the time for the election by each Shareholder of the mode of the making of
such dividend or distribution to that Shareholder. Any such dividend or
distribution paid in Shares will be paid at the net asset value thereof as
determined in accordance with Subsection (i) of Section 4.3.
The Trustees shall have full discretion, to the extent not inconsistent
with the 1940 Act, to determine which items shall be treated as income and which
items as capital; and each such determination and allocation shall be conclusive
and binding upon the Shareholders.
(e) LIQUIDATION. In the event of the liquidation or dissolution of the
Trust, any Sub-Trust or class thereof the Shareholders of each Sub-Trust or any
class thereof that has been established and designated shall be entitled to
receive, when and as declared by the Trustees, the excess of the assets
belonging to that Sub-Trust, or in the case of a class, belonging to that
Sub-Trust and allocable to that class, over the liabilities belonging to that
Sub- Trust or class. Upon the liquidation or dissolution of the Trust or any
Sub-Trust or class pursuant to this Section 4.3(e) the Trustees shall make
provisions for the payment of all outstanding obligations, taxes and other
liabilities, accrued or contingent, of the Trust or that Sub-Trust or class. The
assets so distributable to the Shareholders of any particular Sub-Trust or class
thereof shall be distributed among such Shareholders in proportion to the
relative net asset value, as defined in Section 4.3(i), of such Shares. The
liquidation or
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dissolution of any particular Sub-Trust or class thereof may be authorized by
vote of a majority of the Trustees then in office without the approval of the
Shareholders of the Trust or that Sub-Trust or class thereof.
(f) VOTING. On each matter submitted to a vote of the Shareholders,
each holder of a Share of each Sub- Trust or any class thereof shall be entitled
to one vote for each whole Share and for a proportionate fractional vote for
each fractional Share outstanding in his name on the books of the Trust, and all
shares of each Sub- Trust or class thereof shall vote as a separate class,
except as to voting for Trustees and as otherwise required by the 1940 Act. As
to any matter which does not affect the interest of a particular Sub-Trust or
class thereof, only the holders of Shares of one or more of the affected
Sub-Trusts or classes thereof shall be entitled to vote.
(g) REDEMPTION BY SHAREHOLDER. Each Shareholder shall have the right to
tender all or part of his shares of the Sub-Trust or any class thereof for
redemption at such times as the By-Laws permit, but at least once weekly, with
the redemption price equal to the net asset value per Share as defined in this
Section. The Trust shall make payment in cash unless in the Trustee's judgment
conditions exist which make payment in cash undesirable, in which case the Trust
may make payment wholly or partly in assets belonging to the Sub-Trust or class
thereof. The Trust may postpone payment of the redemption price and suspend the
Shareholder's right of redemption in appropriate circumstances, to the extent
permissible under the 1940 Act.
(h) REDEMPTION BY TRUST. The Trustees shall have the right to redeem
the Shares of the Trust and Sub- Trusts or classes thereof at the same
redemption price as if the Shareholder were redeeming the Shares. A redemption
by the Trustees shall occur if: (1) the Trustees determine in their sole
discretion that failure to redeem the Shares would result in material adverse
consequences to the Shareholders of any of the Sub-Trusts; or (2) a Shareholder
fails to maintain a minimum amount as set forth in the current prospectus of the
Trust (Sub-Trust). If the Trustees exercise their right of redemption, the
Shareholder shall have no further right except to receive payment of the
redemption price.
(i) NET ASSET VALUE. The net asset value per Share of any Sub-Trust
shall be (a) in the case of a Sub- Trust whose Shares are not divided into
classes, the quotient obtained by dividing the value of the net assets of that
Sub-Trust (being the value of the assets belonging to that Sub-Trust less the
liabilities belonging to that Sub-Trust) by the total number of Shares of that
Sub-Trust outstanding, and (b) in the case of a class of Shares of a Sub-Trust
whose Shares are divided into classes, the quotient obtained by dividing the
value of the assets of that Sub-Trust allocable to such class (less the
liabilities belonging to such class) by the total number of Shares of such class
outstanding. The net asset value shall be computed in accordance with the 1940
Act and regulations thereunder. In calculating the net asset value, methods and
procedures established by the Trustees shall be used.
The Trustees may determine to maintain the net asset value per Share of
any Sub-Trust at a designated constant dollar amount and in connection therewith
may adopt procedures not inconsistent with the 1940 Act for the continuing
declarations of income attributable to that Sub-Trust as dividends payable in
additional Shares of that Sub-Trust at the designated constant dollar amount and
for the handling of any losses attributable to that Sub-Trust. Such procedures
may provide that in the event of any loss each Shareholder shall be deemed to
have contributed to the capital of the Trust attributable to that Sub-Trust his
pro rata portion of the total number of Shares required to be canceled in order
to permit the net asset value per Share of that Sub-Trust to be maintained,
after reflecting such loss, at the designated constant dollar amount. Each
Shareholder of the Trust shall be deemed to have agreed, by his investment in
any Sub-Trust with respect to which the Trustees shall have adopted any such
procedure, to make the contribution referred to in the preceding sentence in the
event of any such loss.
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(j) TRANSFER. All Shares of each particular Sub-Trust or class thereof
shall be transferable, but transfers of Shares of a particular Sub-Trust or
class thereof will be recorded on the Share transfer records of the Trust
applicable to that Sub-Trust or class only at such times as Shareholders shall
have the right to require the Trust to redeem Shares of that Sub-Trust or class
and at such other times as may be permitted by the Trustees.
(k) EQUALITY. Except as provided herein or in the instrument
designating and establishing any class of Shares or any Sub-Trust, all Shares of
each particular Sub-Trust or class thereof shall represent an equal
proportionate interest in the assets belonging to that Sub-Trust, or in the case
of a class, belonging to that Sub- Trust and allocable to that class (subject to
the liabilities belonging to that Sub-Trust or class), and each Share of any
particular Sub-Trust or class shall be equal to each other Share of that
Sub-Trust or class; but the provisions of this sentence shall not restrict any
distinctions permissible under Subsection (d) of this Section 4.3 that may exist
with respect to dividends and distributions on Shares of the same Sub-Trust or
class. The Trustees may from time to time divide or combine the Shares of any
particular Sub-Trust or class into a greater or lesser number of Shares of that
Sub-Trust or class without thereby changing the proportionate beneficial
interest in the assets of that Sub-Trust or class or in any way affecting the
rights of Shares of any other Sub- Trust or class.
(l) FRACTIONS. A fractional Share of a Sub-Trust or class
proportionately carries all the rights and obligations of a whole Share of the
Sub-Trust or class.
(m) CONVERSION RIGHTS. The Trustees shall have authority to establish
procedures pursuant to which a Shareholder of one Sub-Trust or class thereof may
exchange shares of that Sub-Trust for shares of another Sub-Trust or class
thereof.
(n) CLASS DIFFERENCES. The relative rights and preferences of the
classes of any Sub-Trust may differ in such other respects as the Trustees may
determine to be appropriate in their sole discretion, provided that such
differences are set forth in the resolutions adopted by the Trustees or the
instrument establishing and designating such classes and executed by a majority
of the Trustees (or by an instrument executed by an officer of the Trust
pursuant to a vote of a majority of the Trustees).
Section 4.4 OWNERSHIP OF SHARES. The ownership of Shares shall be
recorded on the books of the Trust or of a transfer or similar agent for the
Trust, which books shall be maintained separately for the Shares of each
Sub-Trust and each class thereof. No certificates certifying the ownership of
Shares need be issued except as the Trustees determine. The Trustees may
establish such rules as they consider appropriate for the issuance of Share
certificates, use of facsimile signatures, transfer of Shares and similar
matters. The record books of the Trust shall be conclusive as to who are the
Shareholders and as to the number of Shares of each Sub-Trust and class thereof
held from time to time by each such Shareholder.
Section 4.5 INVESTMENTS IN THE TRUST. The Trustees shall have authority
to establish procedures and policies with respect to acceptance or rejection of
investments in the Trust and Sub-Trusts and to authorize other persons to accept
and reject orders for the purchase of Shares in accordance therewith.
Section 4.6 NO PREEMPTIVE RIGHTS. The Shares of the Trust or Sub-Trusts
have no preemptive rights.
Section 4.7 STATUS OF SHARES AND LIMITATION OF PERSONAL LIABILITY.
Shares shall be deemed to be personal property giving only the rights provided
in this instrument. Every Shareholder, by virtue of having become a Shareholder,
shall be held to have expressly assented and agreed to the terms hereof and to
have become a party hereto. The death of a Shareholder during the continuance of
the Trust shall not operate to terminate the Trust
Page 10 of 18
or any Sub-Trust thereof 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 as 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 V
SHAREHOLDERS' VOTING POWERS AND MEETINGS
Section 5.1 VOTING POWERS. The Shareholders shall only vote in the
following instances:
(i) election or removal of Trustees as provided herein;
(ii) approval of a contract for which the 1940 Act requires
Shareholder approval;
(iii) reorganization of the Trust or any Sub-Trust if required by
Section 7.2;
(iv) amendment of the Trust Agreement if required by Section 7.3;
(v) determination of whether a derivative or class action suit should
be brought or pursued on behalf of the Trust or Sub-Trust or
class thereof as would the stockholders of a Massachusetts
business corporation, provided that the Shareholders of one
Sub-Trust or class thereof may not vote on an action on behalf of
another Sub-Trust or class thereof or one of its Shareholders;
and
(vi) such additional matters relating to the Trust as may be required
by the 1940 Act, this Agreement, the By-Laws or any registration
of the Trust with the Commission (or any successor agency) or any
state, or as the Trustees may consider necessary or desirable.
There shall be no cumulative voting in Trustee elections.
Shares may be voted by proxy or in person. Shares held in the name of
two or more persons may be voted by proxy executed by one of the named persons
unless the Trust is notified to the contrary by written instructions, prior to
the execution of the proxy. A proxy purporting to be executed by or on behalf of
a Shareholder shall be presumed valid unless challenged at or prior to its
exercise and the burden of proving invalidity shall be on the challenger.
Until Shares are issued, the Trustees may take any action required by
law, this Agreement or the By- Laws to be taken by Shareholders.
Proxies may be given orally or in writing or pursuant to any
computerized or mechanical data gathering process specifically approved by the
Trustees.
Section 5.2 MEETINGS AND NOTICE. No annual or regular meeting of
Shareholders is required; however, the Trustees may call meetings to take action
on matters which require Shareholder vote and for other matters which the
Trustees determine Shareholder vote is necessary or desirable.
Page 11 of 18
The Trustees shall give Shareholders written notice of any Shareholder
meeting by mailing such notice, postage prepaid, at least seven (7) days before
the meeting date to each Shareholder at the Shareholder's address as it appears
on the records of the Trust. The notice shall state the purpose of the meeting.
Upon written request of Shareholders holding 10 percent (10%) or more
of the then outstanding Shares, the Trustees shall call a meeting to vote upon
the removal of a Trustee. If the Trustees do not call a Shareholder meeting
within thirty (30) days after receipt of the written request, Shareholders
holding 10 percent (10%) or more of the then-outstanding Shares may call a
meeting for that purpose, giving notice and following the procedures governing
Trustee-called meetings set forth in this Agreement.
No notice is required for adjourned sessions which are held within a
reasonable time after the original meeting.
Section 5.3 RECORD DATES. For the purpose of determining Shareholders
entitled to vote or act at a meeting, to participate in a dividend or
distribution, or for the purpose of any other action, the Trustees may close the
transfer books for a period not exceeding thirty (30) days (except at or in
connection with the termination of the Trust) as the Trustees may determine.
Alternatively, without closing the transfer books, the Trustees may fix a date
and time not more than sixty (60) days prior to the date of any meeting of
Shareholders or other action as the date and time of record for the
determination of Shareholders entitled to vote at such meeting or to be treated
as Shareholders of record for purposes of such other action, and any Shareholder
who was a Shareholder at the date and time so fixed shall be entitled to vote at
such meeting or any adjournment thereof or to be treated as a Shareholder of
record for purposes of such other action, even though he has since that date and
time disposed of his Shares; and no person becoming a Shareholder after that
date and time shall be so entitled to vote at such meeting or any adjournment
thereof or to be treated as a Shareholder of record for purposes of such other
action.
Section 5.4 QUORUM AND REQUIRED VOTE. A quorum to conduct business
shall consist of a majority of the Shares entitled to vote at a Shareholder's
meeting. A lesser number is sufficient for adjournments.
Unless otherwise required by applicable law or this Agreement, a
majority of the voted Shares at a meeting at which a quorum is present shall be
sufficient to transact business, and Trustees shall be elected by a plurality.
Section 5.5 ACTION BY WRITTEN CONSENT. Unless otherwise required by
applicable law, Shareholders may take action without a meeting if a majority of
the Shareholders entitled to vote on the action (or such greater percentage as
may be required by applicable law for such action) consent in writing to such
action and their consents are filed with the records of the Shareholder
meetings. Written consents shall be treated as votes taken at a Shareholder
meeting.
Section 5.6 INSPECTION OF RECORDS. Shareholders may inspect the Trust's
records to the same extent permitted by Massachusetts Business Corporation Law
to the stockholders of a Massachusetts business corporation.
Section 5.7 ADDITIONAL PROVISIONS. The By-Laws may include further
provisions for Shareholders' votes and meetings and related matters not
inconsistent with the provisions hereof.
Section 5.8 SHAREHOLDER COMMUNICATIONS. Whenever ten or more
Shareholders of record have been for a least six months preceding the date of
application, and who hold in the aggregate either Shares having a net
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asset value of at least $25,000 or at least 1% of the outstanding Shares,
whichever is less, shall apply to the Trustees in writing, stating that they
wish to communicate with other Shareholders with a view to obtaining signatures
to a request for a Shareholder meeting and accompanied by a form of
communication and request which they wish to transmit, the Trustees shall within
five (5) business days after receipt of such application either (a) afford to
such applicants access to a list of the names and addresses of all Shareholders
as recorded on the books of the Trust or Sub-Trust, as applicable; or (b) inform
such applicants as to the approximate number of Shareholders of record, and the
approximate cost of mailing to them the proposed communication and form of
request.
If the Trustees elect to follow the course specified in (b) above (of
this Section 5.8), the Trustees, upon the written request of such applicants,
accompanied by a tender of the material to be mailed and of the reasonable
expenses of mailing, shall, with reasonable promptness, mail such material to
all Shareholders of record at their addresses as recorded on the books, unless
within five (5) business days after such tender the Trustees shall mail to such
applicants and file with the Commission, together with a copy of the material to
be mailed, a written statement signed by at least a majority of the Trustees to
the effect that in their opinion either such material contains untrue statements
of fact or omits to state facts necessary to make the statements contained
therein not misleading, or would be in such violation of applicable law, and
specifying the basis of such opinion. The Trustees shall thereafter comply with
the requirements of the 1940 Act.
ARTICLE VI
LIMITATION OF LIABILITY; INDEMNIFICATION
Section 6.1 TRUSTEES, SHAREHOLDERS, ETC. NOT PERSONALLY LIABLE; NOTICE.
All persons extending credit to, contracting with or having any claim against
the Trust shall look only to the assets of the Sub-Trust with which such person
dealt for payment under such credit, contract or claim; and neither the
Shareholders of any Sub- Trust nor the Trustees, nor any of the Trust's
officers, employees or agents, whether past, present or future, nor any other
Sub-Trust shall be personally liable therefor. Every note, bond, contract,
instrument, certificate or undertaking and every other act or thing whatsoever
executed or done by or on behalf of the Trust, any Sub- Trust or the Trustees or
any of them in connection with the Trust shall be conclusively deemed to have
been executed or done only by or for the Trust (or the Sub-Trust) or the
Trustees and not personally. Nothing in this Agreement shall protect any Trustee
or officer against any liability to the Trust or the Shareholders to which such
Trustee or officer would otherwise be subject by reason of wilful misfeasance,
bad faith, gross negligence or reckless disregard of the duties involved in the
conduct of the office of Trustee or of such officer.
Section 6.2 NOTICE FOR CONTRACTS. Every contract, instrument,
certificate or undertaking made or issued by the Trustees or by any officers or
officer shall give notice (a) that this Agreement is on file with the Secretary
of the Commonwealth of Massachusetts, (b) that the document was executed or made
on behalf of the Trust or by them as Trustees or as officers and not by them
individually, and (c) that the obligations of such instrument are not binding
upon any of them or the Shareholders individually, but are binding only upon the
assets and property of the Trust, or the particular Sub-Trust in question, as
the case may be. Omission of such notice shall not operate to bind any Trustee,
officer or Shareholder individually.
Section 6.3 TRUSTEE'S GOOD FAITH ACTION; EXPERT ADVICE; NO BOND. The
exercise by the Trustees of their powers and discretion hereunder shall be
binding upon everyone interested. A Trustee shall be liable for his own wilful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of the office of Trustee, and for nothing else, and
shall not be liable for errors of judgment or mistakes of fact or law. Subject
to the foregoing, (a) the Trustees shall not be responsible or liable in any
event for any neglect or
Page 13 of 18
wrongdoing of any officer, agent, employee, consultant, adviser, administrator,
distributor or principal underwriter, custodian or transfer, dividend
disbursing, Shareholder servicing or accounting agent of the Trust, nor shall
any Trustee be responsible for the act or omission of any other Trustee; (b) the
Trustees may take advice of counsel or other experts with respect to the meaning
and operation of this Agreement and their duties as Trustees, and shall be under
no liability for any act or omission in accordance with such advice or for
failing to follow such advice; and (c) in discharging their duties, the
Trustees, when acting in good faith, shall be entitled to rely upon the books of
account of the Trust and upon written reports made to the Trustees by any
officer appointed by them, any independent public accountant, and (with respect
to the subject matter of the contract involved) any officer, partner or
responsible employee of a contracting party appointed by the Trustees pursuant
to Section 3.3. The Trustees, as such, shall not be required to give any bond or
other security for the performance of their duties.
Section 6.4 INDEMNIFICATION OF SHAREHOLDERS. In case any Shareholder
(or former Shareholder) of any Sub-Trust of the Trust shall be charged or held
to be personally liable for any obligation or liability of the Trust solely by
reason of being or having been a Shareholder and not because of such
Shareholder's acts or omissions or for some other reason, said Sub-Trust (upon
proper and timely request by the Shareholder) shall assume the defense against
such charge and satisfy any judgment thereon, and the Shareholder or former
Shareholder (or his heirs, executors, administrators or other legal
representatives or in the case of a corporation or other entity, its corporate
or other general successor) shall be entitled out of the assets of said
Sub-Trust estate to be held harmless from and indemnified against all loss and
expense arising from such liability.
Section 6.5 INDEMNIFICATION OF TRUSTEES, OFFICERS, ETC. The Trust shall
indemnify (from the assets of the Sub-Trust or class thereof or Sub-Trusts or
classes thereof in question) each of its Trustees and officers (including
persons who serve at the Trust's request as directors, officers or trustees of
another organization in which the Trust has any interest as a shareholder,
creditor or otherwise [hereinafter referred to as a "Covered Person"]) against
all liabilities, including but not limited to amounts paid in satisfaction of
judgments, in compromise or as fines and penalties, and expenses, including
reasonable accountants' and counsel fees, incurred by any Covered Person in
connection with the defense or disposition of any action, suit or other
proceeding, whether civil or criminal, before any court or administrative or
legislative body, in which such Covered Person may be or may have been involved
as a party or otherwise or with which such person may be or may have been
threatened, while in office or thereafter, by reason of being or having been
such a Trustee or officer, director or trustee, except with respect to any
matter as to which it has been determined in one of the manners described below,
that such Covered Person (i) did not act in good faith in the reasonable belief
that such Covered Person's action was in or not opposed to the best interests of
the Trust or (ii) had acted with wilful misfeasance, bad faith, gross negligence
or reckless disregard of the duties involved in the conduct of such Covered
Person's office (either and both of the conduct described in (i) and (ii) being
referred to hereafter as "Disabling Conduct"). A determination that the Covered
Person is entitled to indemnification, despite allegations of Disabling Conduct,
may be made by (i) a final decision on the merits by a court or other body
before whom the proceeding was brought that the person to be indemnified was not
liable by reason of Disabling Conduct, (ii) dismissal of a court action or an
administrative proceeding against a Covered Person for insufficiency of evidence
of Disabling Conduct, or (iii) a reasonable determination, based upon a review
of the facts, that the indemnitee was not liable by reason of Disabling Conduct
by (a) a vote of a majority of a quorum of Trustees who are neither "interested
persons" of the Trust as defined in section 2(a)(19) of the 1940 Act nor parties
to the proceeding, or (b) an independent legal counsel in a written opinion.
Expenses, including accountants' and counsel fees so incurred by any such
Covered Person (but excluding amounts paid in satisfaction of judgments, in
compromise or as fines or penalties), may be paid from time to time in advance
of the final disposition of any such action, suit or proceeding, provided that
the Covered Person shall have undertaken to repay the amounts so paid to the
Sub-Trust in question if it is ultimately determined that indemnification of
such expenses is not
Page 14 of 18
authorized under this Article VI and (i) the Covered Person shall have provided
security for such undertaking, (ii) the Trust shall be insured against losses
arising by reason of any lawful advances, or (iii) a majority of a quorum of the
disinterested Trustees who are not a party to the proceeding, or an independent
legal counsel in a written opinion, shall have determined, based on a review of
readily available facts (as opposed to a full trial- type inquiry), that there
is reason to believe the Covered Party ultimately will be found to be entitled
to indemnification.
Section 6.6 COMPROMISE PAYMENT. Any compromise settlement shall be
indemnified only if approved: (a) by a majority of the disinterested Trustees
not a party to the proceeding; or (b) by a written opinion of an independent
legal counsel. If payment has been made pursuant to (a) or (b) and the recipient
is subsequently found to have engaged in bad faith, wilful misfeasance, gross
negligence or reckless disregard of duty, the Trust may recover such payment.
Section 6.7 INDEMNIFICATION NOT EXCLUSIVE, ETC. The right of
indemnification provided by this Article VI shall not be exclusive of or affect
any other rights to which any Covered Person may be entitled. The
indemnification shall inure to the benefit of such person's heirs, executors and
administrators. Nothing contained in this Article shall affect any rights to
indemnification to which personnel of the Trust, other than Trustees and
officers, and other persons may be entitled by contract or otherwise under law,
nor the power of the Trust to purchase and maintain liability insurance on
behalf of any such person.
Section 6.8 LIABILITY OF THIRD PERSONS DEALING WITH TRUSTEES. No person
dealing with the Trustees shall be bound to make any inquiry concerning the
validity of any transaction made or to be made by the Trustees or to see to the
application of any payments made or property transferred to the Trust or upon
its order.
ARTICLE VII
MISCELLANEOUS
Section 7.1 DURATION AND TERMINATION OF TRUST. Unless terminated as
provided herein, the Trust shall continue without limitation of time and,
without limiting the generality of the foregoing, no change, alteration or
modification with respect to any Sub-Trust or class thereof shall operate to
terminate the Trust. The Trust, any Sub-Trust or class thereof may be terminated
at any time by a majority of the Trustees then in office, provided that (1) the
distribution of any remaining proceeds or assets of the Trust, any Sub-Trust or
class thereof, as the case may be, pursuant to Section 4.3(e), has been
completed or (2) no shares of the Trust, such Sub-Trust or class thereof, as the
case may be, are then outstanding.
Section 7.2 REORGANIZATION. The Trustees may sell, convey, merge and
transfer the assets of the Trust, or the assets belonging to any one or more
Sub-Trusts, to another trust, partnership, association or corporation organized
under the laws of any state of the United States, or to the Trust to be held as
assets belonging to another Sub-Trust of the Trust, in exchange for cash, shares
or other securities (including, in the case of a transfer to another Sub-Trust
of the Trust, Shares of such other Sub-Trust) with such transfer either (1)
being made subject to, or with the assumption by the transferee of, the
liabilities belonging to each Sub-Trust the assets of which are so transferred,
or (2) not being made subject to, or not with the assumption of, such
liabilities; provided, however, that no assets belonging to any particular
Sub-Trust shall be so transferred unless the terms of such transfer shall have
first been approved at a meeting called for the purpose by the affirmative vote
of the holders of a majority of the outstanding voting Shares, as defined in the
1940 Act, of that Sub-Trust. Following such transfer, the Trustees shall
distribute such cash, shares or other securities (giving due effect to the
assets and liabilities belonging to and any other differences among the various
Sub-Trusts and classes, the
Page 15 of 18
assets belonging to which have been so transferred) among the Shareholders of
the Sub-Trust, the assets belonging to which have been so transferred; and if
all of the assets of the Trust have been so transferred, the Trust shall be
terminated.
The Trust, or any one or more Sub-Trusts, may, either as the successor,
survivor, or nonsurvivor, (1) consolidate with one or more other trusts,
partnerships, associations or corporations organized under the laws of the
Commonwealth of Massachusetts or any other state of the United States, to form a
new consolidated trust, partnership, association or corporation under the laws
of which any one of the constituent entities is organized, or (2) merge into one
or more other trusts, partnerships, associations or corporations organized under
the laws of the Commonwealth of Massachusetts or any other state of the United
States, or have one or more such trusts, partnerships, associations or
corporations merged into it, any such consolidation or merger to be upon such
terms and conditions as are specified in an agreement and plan of reorganization
entered into by the Trust, or one or more Sub-Trusts, as the case may be, in
connection therewith. The terms "merge" or "merger" as used herein shall also
include the purchase or acquisition of any assets of any other trust,
partnership, association or corporation which is an investment company organized
under the laws of the Commonwealth of Massachusetts or any other state of the
United States. Any such consolidation or merger shall require the affirmative
vote of the holders of a majority of the outstanding voting Shares, as defined
in the 1940 Act, of each Sub-Trust affected thereby.
Section 7.3 AMENDMENTS. All rights granted to the Shareholders under
this Agreement are granted subject to the reservation of the right to amend this
Agreement as herein provided, except that no amendment shall repeal the
limitations on personal liability of any Shareholder or Trustee or repeal the
prohibition of assessment upon the Shareholders without the express consent of
each Shareholder or Trustee involved. Subject to the foregoing, the provisions
of this Agreement (whether or not related to the rights of Shareholders) may be
amended at any time, so long as such amendment does not adversely affect the
rights of any Shareholder with respect to which such amendment is or purports to
be applicable and so long as such amendment is not in contravention of
applicable law, including the 1940 Act, by an instrument in writing signed by a
majority of the then Trustees (or by an officer of the Trust pursuant to the
vote of a majority of such Trustees). Any amendment to this Agreement that
adversely affects the rights of Shareholders may be adopted at any time by an
instrument in writing signed by a majority of the then Trustees (or by an
officer of the Trust pursuant to a vote of a majority of such Trustees) when
authorized to do so by the vote in accordance with Subsection (f) of Section 4.3
of Shareholders holding a majority of the Shares entitled to vote. Subject to
the foregoing, any such amendment shall be effective as provided in the
instrument containing the terms of such amendment or, if there is no provision
therein with respect to effectiveness, upon the execution of such instrument and
of a certificate (which may be a part of such instrument) executed by a trustee
or officer of the Trust to the effect that such amendment has been duly adopted.
Section 7.4 FILING OF COPIES; REFERENCES; HEADINGS. This Agreement and
all amendments shall be maintained in Trust offices for Shareholder inspection.
A copy of this Agreement and all amendments shall be filed with the
appropriate governmental offices as required, including the Secretary of the
Commonwealth of Massachusetts and the Boston City Clerk. Failure to make any
such filing shall not impair the effectiveness of this instrument or any such
amendment.
Anyone dealing with the Trust may rely on a certificate by an officer
of the Trust as to whether or not any such amendments have been made, as to the
identities of the Trustees and officers, and as to any matters in connection
with the Trust hereunder; and, with the same effect as if it were the original,
may rely on a copy certified by an officer of the Trust to be a copy of this
instrument or of any such amendments. In this instrument
Page 16 of 18
and in any such amendment, references to this instrument, and all expressions
like "herein," "hereof" and "hereunder" shall be deemed to refer to this
instrument as a whole as the same may be amended or affected by any such
amendments.
As used in this Agreement, the masculine gender shall include the
feminine and neuter genders. Headings are used for reference only and shall not
affect the meaning or construction of this Agreement. Headings are placed herein
for convenience of reference only and shall not be taken as a part hereof or as
controlling or affecting 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.
Any reference to this document shall include all amendments.
Section 7.5 APPLICABLE LAW. This Agreement 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, including the
Massachusetts Business Corporation Law as the same may be amended from time to
time, to which reference is made with the intention that matters not
specifically covered herein or as to which an ambiguity may exist shall be
resolved as if the Trust were a business corporation organized in Massachusetts,
but the reference to said Business Corporation Law is not intended to give the
Trust, the Trustees, the Shareholders or any other person any right, power,
authority or responsibility available only to or in connection with an entity
organized in corporate form. The Trust shall be of the type referred to in
Section 1 of Chapter 182 of the Massachusetts General Laws and of the type
commonly called a Massachusetts business trust, and without limiting the
provisions hereof, the Trust may exercise all powers which are ordinarily
exercised by such a trust.
Section 7.6 RESIDENT AGENT. ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇., ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ for the purposes of complying with the
laws of the Commonwealth of Massachusetts is hereby appointed as resident agent
for the Trust within the Commonwealth of Massachusetts; and hereby is designated
as its attorney in the Commonwealth of Massachusetts upon whom may be served any
notice, process or pleading in any action or proceeding against the Trust and
the undersigned does hereby consent that any such action or proceeding against
the Trust may be commenced in any court of competent jurisdiction and proper
venue within the State so designated by services of process upon said resident
agent with the same effect as if the Trust had been served lawfully with
process. It is requested that a copy of any notice, process or pleadings served
be mailed to U.S. Global Accolade Funds at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇.
Page 17 of 18
IN WITNESS WHEREOF, the undersigned have hereunto set their hand and
seals for themselves and their assigns, as of the date and year first above
written.
/s/ J. ▇▇▇▇▇▇▇ ▇▇▇▇ /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------- --------------------------------
J. ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------- --------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
STATE OF TEXAS )
)ss
COUNTY OF BEXAR )
Then personally appeared before me the above-named and acknowledged the
foregoing instrument to be their free act and deed this 16th day of August,
2000.
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇
--------------------
Notary Public
S E A L
Page 18 of 18
