AGREEMENT AND DECLARATION OF TRUST
OF
AMERICAN GENERAL SERIES PORTFOLIO COMPANY 2
March 16 , 1998
AGREEMENT AND DECLARATION OF TRUST
Index
RECITALS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE I THE TRUST . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
SECTION 1.1 Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
SECTION 1.2. Location . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
SECTION 1.3. Nature of Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
SECTION 1.4. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
SECTION 1.5. Real Property to be Converted into Personal Property . . . . . . . . . . . . . 5
ARTICLE 2 PURPOSE OF THE TRUST . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
ARTICLE 3 POWERS OF THE TRUSTEES . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SECTION 3.1. Powers in General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
(a) Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
(b) Disposition of Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
(c) Ownership Powers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
(d) Form of Holding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
(e) Reorganization, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
(f) Voting Trusts, etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
(g) Contracts, etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
(h) Guarantees, etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
(i) Partnerships, etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
(j) Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
(k) Pensions, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
(I) Power of Collection and Litigation . . . . . . . . . . . . . . . . . . . . . . 7
(m) Issuance and Repurchase of Shares . . . . . . . . . . . . . . . . . . . . . . 8
(n) Offices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
(o) Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
(p) Agents, etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
(q) Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
(r) Valuation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
(s) Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
(t) General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 3.2. Borrowings; Financings; Issuance of Securities . . . . . . . . . . . . . . . . 9
i
SECTION 3.3. Deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
SECTION 3.4. Allocations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
SECTION 3.5. Further Powers; Limitations . . . . . . . . . . . . . . . . . . . . . . . . . . 9
ARTICLE 4 TRUSTEES AND OFFICERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 4.1. Number, Designation, Election, Term, etc. . . . . . . . . . . . . . . . . . . . 10
(a) Initial Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(b) Number . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(c) Election and Term . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(d) Resignation and Retirement . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(e) Removal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(f) Vacancies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(g) Acceptance of Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
(h) Effect of Death, Resignation, etc. . . . . . . . . . . . . . . . . . . . . . . 11
(i) Conveyance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
(j) No Accounting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
SECTION 4.2. Trustees' Meetings; Participation by Telephone, etc. . . . . . . . . . . . . . 11
SECTION 4.3. Committees; Delegation . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
SECTION 4.4. Officers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 4.5. Compensation of Trustees and Officers . . . . . . . . . . . . . . . . . . . . . 12
SECTION 4.6. Ownership of Shares and Securities of the Trust . . . . . . . . . . . . . . . 12
SECTION 4.7. Right of Trustees and Officers to Own Property or to Engage in Business;
Authority of Trustees to Permit Others to Do Likewise . . . . . . . . . . . . 12
SECTION 4.8. Reliance on Experts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 4.9. Surety Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 4.10. Apparent Authority of Trustees and Officers . . . . . . . . . . . . . . . . . . 13
SECTION 4.11. Other Relationships Not Prohibited . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 4.12. Payment of Trust Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 4.13. Ownership of the Trust Property . . . . . . . . . . . . . . . . . . . . . . . . 14
ii
SECTION 4.14. By-Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
ARTICLE 5 DELEGATION OF MANAGERIAL RESPONSIBILITIES . . . . . . . . . . . . . . . . . . . 14
SECTION 5.1. Appointment; Action by Less than All Trustees . . . . . . . . . . . . . . . . . 14
SECTION 5.2. Certain Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
(a) Advisory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
(b) Administration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
(c) Underwriting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
(d) Custodian . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
(e) Transfer and Dividend Disbursing Agent . . . . . . . . . . . . . . . . . . . . 15
(f) Shareholder Servicing . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
(g) Accounting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 5.3. Distribution Arrangements . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Section 5.4. Service Arrangements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
ARTICLE 6 SERIES AND SHARES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 6.1. Description of Series and Shares . . . . . . . . . . . . . . . . . . . . . . . 16
(a) General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
(b) Establishment, etc. of Series; Authorization of Shares . . . . . . . . . . . . 16
(c) Character of Separate Series and Shares Thereof . . . . . . . . . . . . . . . 16
(d) Consideration for Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
(e) Assets Belonging to Series . . . . . . . . . . . . . . . . . . . . . . . . . . 17
(f) Liabilities of Series . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
(g) Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
(h) Liquidation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
(i) Voting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
(j) Redemption by Shareholder . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
(k) Redemption at the Option of the Trust . . . . . . . . . . . . . . . . . . . . . 18
(l) Net Asset Value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
(m) Transfer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
(n) Equality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
(o) Rights of Fractional Shares . . . . . . . . . . . . . . . . . . . . . . . . . 19
(p) Conversion Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 6.2. Ownership of Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 6.3. Investments in the Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 6.4. No Pre-emptive Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
iii
SECTION 6.5. Status of Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
ARTICLE 7 SHAREHOLDERS' VOTING POWERS AND MEETINGS . . . . . . . . . . . . . . . . . . . 20
SECTION 7.1. Voting Powers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 7.2. Number of Votes and Manner of Voting; Proxies . . . . . . . . . . . . . . . . . 21
SECTION 7.3. Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 7.4. Record Dates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 7.5. Quorum and Required Vote . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 7.6. Action by Written Consent . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 7.7. Inspection of Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 7.8. Additional Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
ARTICLE 8 LIMITATION OF LIABILITY; INDEMNIFICATION . . . . . . . . . . . . . . . . . . . 22
SECTION 8.1. Trustees, Shareholders, etc. Not Personally Liable; Notice . . . . . . . . . . 22
SECTION 8.2. Trustees' Good Faith Action; Expert Advice; No Bond or Surety . . . . . . . . . 23
SECTION 8.3. Indemnification of Shareholders . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 8.4. Indemnification of Trustees, Officers, etc. . . . . . . . . . . . . . . . . . 23
SECTION 8.5. Compromise Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 8.6. Indemnification Not Exclusive, etc. . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 8.7. Liability of Third Persons Dealing with Trustees . . . . . . . . . . . . . . . 24
ARTICLE 9 DURATION; REORGANIZATION; INCORPORATION;
AMENDMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 9.1. Duration of Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 9.2. Termination of Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 9.3. Reorganization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 9.4. Incorporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
iv
SECTION 9.5. Amendments; etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 9.6. Filing of Copies of Declaration and Amendments . . . . . . . . . . . . . . . . 26
ARTICLE 10 MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 10.1. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 10.2. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 10.3. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 10.4. Reliance by Third Parties . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 10.5. References; Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 10.6. Provisions in Conflict With Law or Regulation . . . . . . . . . . . . . . . . . 26
SECTION 10.7. Use of the Name "American General" . . . . . . . . . . . . . . . . . . . . . . 27
Signature . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Acknowledgments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
v
AGREEMENT AND DECLARATION OF TRUST
OF
AMERICAN GENERAL SERIES PORTFOLIO COMPANY 2
This AGREEMENT AND DECLARATION OF TRUST, made at this 16th day of
March, 1998, by and between The Variable Annuity Life Insurance Company, a
corporation resident in Houston, Texas (the "Settlor"), and the Trustee whose
signature is set forth below (the "Initial Trustee"),
W I T N E S S E T H T H A T:
WHEREAS, the Settlor proposes to deliver to the Initial Trustee the
sum of one hundred dollars ($100.00) lawful money of the United States of
America in trust hereunder and to authorize the Initial Trustee and all other
individuals acting as Trustees hereunder to employ such funds, and any other
funds coming into their hands or the hands of their successor or successors as
such Trustees, to carry on the business of an investment company and as such of
buying, selling, investing or otherwise dealing in and with stocks, bonds,
debentures, warrants and other securities and interests therein, financial
futures contracts, or options with respect to securities or financial futures
contracts, and such other and further investment media and other property as
the Trustees may deem advisable, which are not prohibited by law or the terms
of this Declaration; and
WHEREAS, the Initial Trustee is willing to accept such sum, together
with any and all additions thereto and the income or increments thereof, upon
the terms, conditions and trusts hereinafter set forth; and
WHEREAS, the beneficial interest in the assets held by the Trustees
shall be divided into transferable Shares, all in accordance with the
provisions hereinafter set forth; and
WHEREAS, it is desired that the trust established hereby be managed
and operated as a trust with transferable shares under the laws of Delaware
with respect to Delaware business trusts in accordance with the provisions
hereinafter set forth:
NOW, THEREFORE, the Initial Trustee, for him/her self and his/her
successors as Trustees, hereby declares and agrees with the Settlor, for
him/her self and for all Persons who shall hereafter become holders of Shares
that the Trustees will hold the sum delivered to them upon the execution
hereof, and all other and further cash, securities and other property of every
type and description which they may in any way acquire in their capacity as
such Trustees, together with the income therefrom and the proceeds thereof, IN
TRUST NEVERTHELESS, to manage and dispose of the same for the benefit of the
holders from time to time of the Shares being issued and to be issued hereunder
and in the manner and subject to the provisions hereof, to wit:
1
ARTICLE I
THE TRUST
SECTION 1.1 Name. The name of the Trust shall be
"AMERICAN GENERAL SERIES PORTFOLIO COMPANY 2"
and so far as may be practicable, the Trustees shall conduct the Trust's
activities, execute all documents and ▇▇▇ or be sued under that name, which
name (and the word "Trust" wherever used in this Agreement and Declaration of
Trust, except where the context otherwise requires) shall refer to the Trustees
in their capacity as Trustees, and not individually or personally, and shall
not refer to the officers, agents or employees of the Trust or of such
Trustees, or to the holders of the Shares of the Trust or any Series. If the
Trustees determine that the use of such name is not practicable, legal or
convenient at any time or in any jurisdiction, or if the Trust is required to
discontinue the use of such name pursuant to Section 10.7 hereof, then subject
to that Section, the Trustees may use such other designation, or they may adopt
such other name for the Trust as they deem proper, and the Trust may hold
property and conduct its activities under such designation or name.
SECTION 1.2. Location. The Trust shall maintain a registered office in
the State of Delaware and may have such other offices or places of business as
the Trustees may from time to time determine to be necessary or expedient.
SECTION 1.3. Nature of Trust. The Trust shall be a trust with
transferable shares under the laws of The State of Delaware, of the type
defined in Title 12, Chapter 38, Section 3801 of the Delaware Code as a
business trust. The Trust is not intended to be, shall not be deemed to be, and
shall not be treated as, a general partnership, limited partnership, joint
venture, corporation or joint stock company. The Shareholders shall be
beneficiaries and their relationship to the Trustees shall be solely in that
capacity in accordance with the rights conferred upon them hereunder.
SECTION 1.4. Definitions. As used in this Agreement and Declaration of
Trust, the following terms shall have the meanings set forth below unless the
context thereof otherwise requires:
"Accounting Agent" shall have the meaning designated in Section 5.2(g)
hereof.
"Administrator" shall have the meaning designated in Section 5.2(b)
hereof.
"Affiliated Person" shall have the meaning assigned to it in the 1940
Act.
"By-Laws" shall mean the By-Laws of the Trust, as amended from time to
time.
"Certificate of Designation" shall have the meaning designated in
Section 6.1 hereof.
"Certificate of Termination" shall have the meaning designated in
Section 6.1 hereof.
"Class" or "Classes" shall mean, with respect to the Trust (or any
Series thereof), any unissued Shares of the Trust (or such Series) in
respect of which the Trustees shall from time to time fix and
determine any special provisions relating to sales charges, any rights
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 Shareholders of such Class shall have
separate voting rights or no voting rights.
2
"Commission" shall have the same meaning as in the 1940 Act.
"Contracting Party" shall have the meaning designated in the preamble
to Section 5.2 hereof.
"Conversion Date" shall mean with respect to Shares of any Class that
are convertible automatically into Shares of any other Class of the
Trust (or Series thereof) the date fixed by the Trustees for such
conversion.
"Covered Person" shall have the meaning designated in Section 8.4
hereof.
"Custodian" shall have the meaning designated in Section 5.2(d)
hereof.
"Declaration" and "Declaration of Trust" shall mean this Agreement and
Declaration of Trust and all amendments or modifications thereof as
from time to time in effect. This Agreement and Declaration of Trust
is the "governing instrument" of the Trust within the meaning of the
laws of the State of Delaware with respect to Delaware Business
Trusts. References in this Agreement and Declaration of Trust to
"hereof", "herein" and "hereunder" shall be deemed to refer to the
Declaration of Trust generally, and shall not be limited to the
particular text, Article or Section in which such words appear.
"Disabling Conduct" shall have the meaning designated in Section 8.4
hereof.
"Distributor" shall have the meaning designated in Section 5.2(c)
hereof.
"Dividend Disbursing Agent" shall have the meaning designated in
Section 5.2(e) hereof.
"General Items" shall have the meaning defined in Section 6.2(a)
hereof.
"Initial Trustee" shall have the meaning defined in the preamble
hereto.
"Investment Adviser" shall have the meaning defined in Section 5.2(a)
hereof.
"Majority of the Trustees" shall mean a majority of the Trustees in
office at the time in question. At any time at which there shall be
only one (1) Trustee in office, such term shall mean such Trustee.
"Majority Shareholder Vote," as used with respect to (a) the election
of any Trustee at a meeting of Shareholders, shall mean the vote for
the election of such Trustee of a plurality of all outstanding Shares
of the Trust, without regard to Series, represented in person or by
proxy and entitled to vote thereon, provided that a quorum (as
determined in accordance with the By-Laws) is present, (b) any other
action required or permitted to be taken by Shareholders, shall mean
the vote for such action of the holders of that majority of all
outstanding Shares (or, where a separate vote of Shares of any
particular Series is to be taken, the affirmative vote of that
majority of the outstanding Shares of that Series) of the Trust which
consists of: (i) a majority of all Shares (or of Shares of the
particular Series) represented in person or by proxy and entitled to
vote on such action at the meeting of Shareholders at which such
action is to be taken, provided that a quorum (as determined in
accordance with the By-Laws) is present; or (ii) if such action is to
be taken by written consent of Shareholders, a majority of all Shares
(or of Shares of the particular Series) issued and outstanding and
entitled to vote on such action; provided that (iii) as used with
respect to any action requiring the affirmative vote of "a majority of
the outstanding voting securities," as the quoted phrase is defined in
the 1940 Act, of the Trust or of any Series, "Majority Shareholder
Vote" means the vote for such action at a meeting of Shareholders of
the smallest majority of all outstanding Shares of the Trust (or of
Shares of the particular Series) entitled to vote on such action which
satisfies such 1940 Act voting requirement.
3
"1940 Act" shall mean the provisions of the Investment Company Act of
1940 and the rules and regulations thereunder, both as amended from
time to time, and any order or orders thereunder which may from time
to time be applicable to the Trust.
"Person" shall mean and include individuals, as well as corporations,
limited partnerships, general partnerships, joint stock companies,
joint ventures, associations, banks, trust companies, land trusts,
business trusts or other organizations established under the laws of
any jurisdiction, whether or not considered to be legal entities, and
governments and agencies and political subdivisions thereof.
"Principal Underwriter" shall have the meaning designated in Section
5.2(c) hereof.
"Prospectus," as used with respect to the Trust (or the Shares of a
particular Series), shall mean the prospectus relating to the Trust
(or such Series) which constitutes part of the currently effective
Registration Statement of the Trust under the Securities Act of 1933,
as such prospectus may be amended or supplemented from time to time.
"Securities" shall have the same meaning ascribed to that term in the
Securities Act of 1993.
"Series" shall mean one or more of the series of Shares authorized by
the Trustees to represent the beneficial interest in one or more
separate components of the assets of the Trust which are now or
hereafter established and designated under or in accordance with the
provisions of Article 6 hereof.
"Settlor" shall have the meaning defined in the preamble hereto.
"Shareholder" shall mean as of any particular time any Person shown of
record at such time on the books of the Trust as a holder of
outstanding Shares of any Series, and shall include a pledgee into
whose name any such Shares are transferred in pledge.
"Shareholder Servicing Agent" shall have the meaning designated in
Section 5.2(f) hereof.
"Shares" shall mean the transferable units into which the beneficial
interest in the Trust and each Series of the Trust (as the context may
require) shall be divided from time to time, and includes fractions of
Shares as well as whole Shares. All references herein to "Shares"
which are not accompanied by a reference to any particular Series or
Class shall be deemed to apply to outstanding Shares without regard to
Series or Class.
"Single Class Voting," as used with respect to any matter to be acted
upon at a meeting or by written consent of Shareholders, shall mean a
style of voting in which each holder of one or more Shares shall be
entitled to one vote on the matter in question for each Share standing
in his/her name on the records of the Trust, irrespective of Series or
Class of a Series, and all outstanding Shares of all Series vote as a
single class.
"Statement of Additional Information," as used with respect to the
Trust (or any Series), shall mean the statement of additional
information relating to the Trust (or such Series) which constitutes
part of the currently effective Registration Statement of the Trust
under the Securities Act of 1933, as such statement of additional
information may be amended or supplemented from time to time.
"Transfer Agent" shall have the meaning defined in Section 5.2(e)
hereof.
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"Trust" shall mean the trust named in Section 1.1 hereof.
"Trust Property" shall mean, as of any particular time, any and all
property which shall have been transferred, conveyed or paid to the
Trust or the Trustees, and all interest, dividends, income, earnings,
profits and gains therefrom, and proceeds thereof, including any
proceeds derived from the sale, exchange or liquidation thereof, and
any funds or payments derived from any reinvestment of such proceeds
in whatever form the same may be, and which at such time is owned or
held by, or for the account of, the Trust or the Trustees, without
regard to the Series to which such property is allocated.
"Trustees" shall mean, collectively, the Initial Trustee, so long as
he/she shall continue in office, and all other individuals who at the
time in question have been duly elected or appointed as Trustees of
the Trust in accordance with the provisions hereof and who have
qualified and are then in office. At any time at which there shall be
only one (I) Trustee in office, such term shall mean such single
Trustee.
SECTION 1.5. Real Property to be Converted into Personal Property.
Notwithstanding any other provision hereof, any real property at any time
forming part of the Trust Property shall be held in trust for sale and
conversion into personal property at such time or times and in such manner and
upon such terms as the Trustees shall approve, but the Trustees shall have
power until the termination of this Trust to postpone such conversion as long
as they in their uncontrolled discretion shall think fit, and for the purpose
of determining the nature of the interest of the Shareholders therein, all such
real property shall at all times be considered as personal property.
ARTICLE 2
PURPOSE OF THE TRUST
The purpose of the Trust shall be to (a) manage, conduct, operate and carry
on the business of an investment company; (b) subscribe for, invest in,
reinvest in, purchase or otherwise acquire, hold, pledge, sell, assign,
transfer, exchange, distribute or otherwise deal in or dispose of any and all
sorts of property, tangible or intangible, including but not limited to
Securities of any type whatsoever, whether equity or nonequity, of any issuer,
evidences of indebtedness of any person and any other rights, interest,
instruments or property of any sort to exercise any and all rights, powers and
privileges of ownership or interest in respect of any and all such investment
of every kind and description, including without limitation, the right to
consent and otherwise act with respect thereto, with power to designate one or
more Persons to exercise any of said rights, powers and privileges in respect
of any of said investments. The Trustees shall not be limited by any law
limiting the investments which may be made by fiduciaries.
ARTICLE 3
POWERS OF THE TRUSTEES
SECTION 3.1. Powers in General. The Trustees shall have, without other or
further authorization, full, entire, exclusive and absolute power, control and
authority over, and management of, the business of the Trust and over the Trust
Property, to the same extent as if the Trustees were the sole owners of the
business and property of the Trust in their own right, and with such powers of
delegation as may be permitted by this Declaration, subject only to such
limitations as may be expressly imposed by this Declaration of Trust or by
applicable law. The enumeration of any specific power or authority herein shall
not be construed as limiting the aforesaid power or authority or any specific
power or authority. Without limiting the foregoing; they may select, and from
time to time change, the fiscal year of the Trust; they may adopt and use a
seal for the Trust, provided that unless otherwise required by the Trustees, it
shall
5
not be necessary to place the seal upon, and its absence shall not impair the
validity of, any document, instrument or other paper executed and delivered by
or on behalf of the Trust; they may from time to time in accordance with the
provisions of Section 6.1 hereof establish one or more Series to which they may
allocate such of the Trust Property, subject to such liabilities, as they shall
deem appropriate, each such Series to be operated by the Trustees as a separate
and distinct investment medium and with separately defined investment
objectives and policies and distinct investment purposes, all as established by
the Trustees, or from time to time changed by them; they may as they consider
appropriate elect and remove officers and appoint and terminate agents and
consultants and hire and terminate employees, any one or more of the foregoing
of whom may be a Trustee; they may appoint from their own number, and
terminate, any one or more committees consisting of one or more Trustees,
including without implied limitation an Executive Committee, which may, when
the Trustees are not in session and subject to the 1940 Act, exercise some or
all of the power and authority of the Trustees as the Trustees may determine;
in accordance with Section 5.2 they may employ one or more Investment Advisers,
Administrators and Custodians and may authorize any such service provider to
employ one or more other or service providers and to deposit all or any part of
such assets in a system or systems for the central handling of Securities,
retain Transfer, Dividend Disbursing, 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,
set record dates or times for the determination of Shareholders entitled to
participate in, benefit from or act with respect to various matters; and in
general they may delegate to any officer of the Trust, to any Committee of the
Trustees and to any employee, Investment Adviser, Administrator, Distributor,
Custodian, Transfer Agent, Dividend Disbursing Agent, or any other agent or
consultant of the Trust, such authority, powers, functions and duties as they
consider desirable or appropriate for the conduct of the business and affairs
of the Trust, including without implied limitation the power and authority to
act in the name of the Trust and of the Trustees, to sign documents and to act
as attorney-in-fact for the Trustees. Without limiting the foregoing and to the
extent not inconsistent with the 1940 Act or other applicable law, the Trustees
shall have power and authority:
(a) Investments. To subscribe for, invest in, reinvest in, purchase or
otherwise acquire, hold, pledge, sell, assign, transfer, exchange, distribute
or otherwise deal in or dispose of any and all sorts of property, tangible or
intangible, including but not limited to Securities of any type whatsoever,
whether equity or nonequity, of any issuer, evidences of indebtedness of any
person and any other rights, interest, instruments or property of any sort, to
exercise any and all rights, powers and privileges of ownership or interest in
respect of any and all such investments of every kind and description,
including without limitation the right to consent and otherwise act with
respect thereto, with power to designate one or more Persons to exercise any of
said rights, powers and privileges in respect of any of said investments, in
every case without being limited by any law limiting the investments which may
be made by fiduciaries;
(b) Disposition of Assets. Upon such terms and conditions as they deem
best, to lend, sell, exchange, mortgage, pledge, hypothecate, grant security
interests in, encumber, negotiate, convey, transfer or otherwise dispose of,
and to trade in, any and all of the Trust Property, free and clear of all
trusts, for cash or on terms, with or without advertisement, and on such terms
as to payment, security or otherwise, all as they shall deem necessary or
expedient;
(c) Ownership Powers. To vote or give assent, or exercise any and all other
rights, powers and privileges of ownership with respect to, and to perform any
and all duties and obligations as owners of, any Securities or other property
forming part of the Trust Property, the same as any individual might do; to
exercise powers and rights of subscription or otherwise which in any manner
arise out of ownership of Securities, and to receive powers of attorney from,
and to execute and deliver proxies or powers of attorney to, such Person or
Persons as the Trustees shall deem proper, receiving from or granting to such
Person or Persons such power and discretion with relation to Securities or
other property of the Trust, all as the Trustees shall deem proper;
6
(d) Form of Holding. To hold any Security or other 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 of the Series to which such
Securities or property belong, or in the name of a Custodian, subcustodian or
other nominee or nominees, or otherwise,upon such terms, in such manner or with
such powers, as the Trustees may determine, and with or without indicating any
trust or the interest of the Trustees therein;
(e) Reorganizations etc. 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 or any Series; to consent to any
contract, lease, mortgage, purchase or sale of property by such corporation or
issuer, and to pay calls or subscriptions with respect to any Security forming
part of the Trust Property;
(f) Voting Trusts, etc. To join with other holders of any Securities in
acting through a committee, depository, voting trustee or otherwise, and in
that connection to deposit any Security with, or transfer any Security to, any
such committee, depository 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,
depository or trustee as the Trustees shall deem proper;
(g) Contracts. etc. To enter into, make and perform all such obligations,
contracts, agreements and undertakings of every kind and description, with any
Person or Persons, as the Trustees shall in their discretion deem expedient in
the conduct of the business of the Trust, for such terms as they shall see fit,
whether or not extending beyond the term of office of the Trustees, or beyond
the possible expiration of the Trust; to amend, extend, release or cancel any
such obligations, contracts, agreements or understandings; and to execute,
acknowledge, deliver and record all written instruments which they may deem
necessary or expedient in the exercise of their powers;
(h) Guarantees. etc. To endorse or guarantee the payment of any notes or
other obligations of any Person; to make contracts of guaranty or suretyship,
or otherwise assume liability for payment thereof; and to mortgage and pledge
the Trust Property or any part thereof to secure any of or all such
obligations;
(i) Partnerships, etc. To enter into joint ventures, general or limited
partnerships and any other combinations or association;
(j) 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
business, including, without limitation, insurance policies insuring the assets
of the Trust and payment of distributions and principal on its portfolio
investments, and insurance policies insuring the Shareholders, Trustees,
officers, employees, agents, consultants, Investment Advisers, managers,
Administrators, Distributors, Principal Underwriters, or other independent
contractors, or any thereof (or any Person connected therewith), of the Trust,
individually, against all claims and liabilities of every nature arising by
reason of holding, being or having held any such office or position, or by
reason of any action alleged to have been taken or omitted by any such Person
in any such capacity, whether or not the Trust would have the power to
indemnify such Person against such liability;
(k) Pensions, etc. To pay pensions for faithful service, as deemed
appropriate by the Trustees, and to adopt, establish and carry out pension,
profit sharing, share bonus, share purchase, savings, thrift, deferred
compensation and other retirement, incentive and benefit plans, trusts and
provisions, including the purchasing of life insurance and annuity contracts as
a means of providing such retirement and other benefits, for any or all of the
Trustees, officers, employees and agents of the Trust;
7
(l) Power of Collection and Litigation. To collect, ▇▇▇ for and receive all
sums of money coming due to the Trust, to employ counsel, and to commence,
engage in, prosecute, intervene in, join, defend, compound, compromise, adjust
or abandon, in the name of the Trust, any and all actions, suits, proceedings,
disputes, claims, controversies, demands or other litigation or legal
proceedings relating to the Trust, the business of the Trust, the Trust
Property, or the Trustees, officers, employees, agents and other independent
contractors of the Trust, in their capacity as such, at law or in equity, or
before any other bodies or tribunals, and to compromise, arbitrate or otherwise
adjust any dispute to which the Trust may be a party, whether or not any suit
is commenced or any claim shall have been made or asserted. Except to the
extent required for a Delaware Business Trust, the Shareholders shall have no
power to vote as to whether or not a court action, legal 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.
(m) Issuance and Repurchase of Shares. To authorize, issue, sell,
repurchase, redeem, retire, cancel, acquire, hold, resell, reissue, dispose of,
transfer, and otherwise deal in Shares of any Series, and, subject to Article 6
hereof, to apply to any such repurchase, redemption, retirement, cancellation
or acquisition of Shares of any Series, any of the assets belonging to the
Series to which such Shares relate, whether constituting capital or surplus or
otherwise, to the full extent now or hereafter permitted by applicable law;
provided that any Shares belonging to the Trust shall not be voted, directly or
indirectly;
(n) Offices. To have one or more offices, and to carry on all or any of the
operations and business of the Trust, in any of the States, Districts or
Territories of the United States, and in any and all foreign countries, subject
to the laws of such State, District, Territory or country;
(o) Expenses. To incur and pay any and all such expenses and charges as
they may deem advisable (including without limitation appropriate fees to
themselves as Trustees), and to pay all such sums of money for which they may
be held liable by way of damages, penalty, fine or otherwise;
(p) Agents, etc. To retain and employ any and all such servants, agents,
employees, attorneys, brokers, Investment Advisers, accountants, architects,
engineers, builders, escrow agents, depositories, consultants, ancillary
trustees, custodians, agents for collection, insurers, banks and officers, as
they think best for the business of the Trust or any Series, to supervise and
direct the acts of any of the same, and to fix and pay their compensation and
define their duties;
(q) Accounts. To determine, and from time to time change, the method or
form in which the accounts of the Trust or any Series shall be kept;
(r) Valuation. Subject to the requirements of the 1940 Act, to determine
from time to time the value of all or any part of the Trust Property and of any
services, Securities, property or other consideration to be furnished to or
acquired by the Trust, and from time to time to revalue all or any part of the
Trust Property in accordance with such appraisals or other information as is,
in the Trustees' sole judgment, necessary and satisfactory;
(s) Indemnification. In addition to the mandatory indemnification provided
for in Article 8 hereof and to the extent permitted by law, to indemnify or
enter into agreements with respect to indemnification with any Person with whom
this Trust has dealings, including, without limitation, any independent
contractor, to such extent as the Trustees shall determine; and
(t) General. Subject to the fundamental policies in effect from time to
time with respect to the Trust, to do all such other acts and things and to
conduct, operate, carry on and engage in such other lawful businesses or
business activities as they shall in their sole and absolute discretion
consider to be incidental to the business of the Trust or any Series as
8
an investment company, and to exercise all powers which they shall in their
discretion consider necessary, useful or appropriate to carry on the business
of the Trust or any Series, to promote any of the purposes for which the Trust
is formed, whether or not such things are specifically mentioned herein, in
order to protect or promote the interests of the Trust or any Series, or
otherwise to carry out the provisions of this Declaration.
SECTION 3.2. Borrowings; Financings: Issuance of Securities. The Trustees
have power, subject to the fundamental policies in effect from time to time
with respect to the Trust, to borrow or in any other manner raise such sum or
sums of money, and to incur such other indebtedness for goods or services, or
for or in connection with the purchase or other acquisition of property, as
they shall deem advisable for the purposes of the Trust, in any manner and on
any terms, and to evidence the same by negotiable or nonnegotiable Securities
which may mature at any time or times, even beyond the possible date of
termination of the Trust; to issue Securities of any type for such cash,
property, services or other considerations, and at such time or times and upon
such terms, as they may deem advisable; and to reacquire any such Securities.
Any such Securities of the Trust may, at the discretion of the Trustees, be
made convertible into Shares of any Series, or may evidence the right to
purchase, subscribe for or otherwise acquire Shares of any Series, at such
times and on such terms as the Trustees may prescribe.
SECTION 3.3. Deposits. Subject to the requirements of the 1940 Act, the
Trustees shall have power to deposit any moneys or Securities included in the
Trust Property with any one or more banks, trust companies or other banking
institutions, whether or not such deposits will draw interest. Such deposits
are to be subject to withdrawal in such manner as the Trustees may determine,
and the Trustees shall have no responsibility for any loss which may occur by
reason of the failure of the bank, trust company or other banking institution
with which any such moneys or Securities have been deposited, except as
provided in Section 8.2 hereof.
SECTION 3.4. Allocations. The Trustees shall have power to determine
whether moneys or other assets received by the Trust shall be charged or
credited to income or capital, or allocated between income and capital,
including the power to amortize or fail to amortize any part or all of any
premium or discount, to treat any part or all of the profit resulting from the
maturity or sale of any asset, whether purchased at a premium or at a discount,
as income or capital, or to apportion the same between income and capital, to
apportion the sale price of any asset between income and capital, and to
determine in what manner any expenses or disbursements are to be borne as
between income and capital, whether or not in the absence of the power and
authority conferred by this Section 3.4 such assets would be regarded as income
or as capital or such expense or disbursement would be charged to income or to
capital; to treat any dividend or other distribution on any investment as
income or capital, or to apportion the same between income and capital; to
provide or fail to provide reserves, including reserves for depreciation,
amortization or obsolescence in respect of any Trust Property in such amounts
and by such methods as they shall determine; to allocate less than all of the
consideration paid for Shares of any Series to surplus with respect to the
Series to which such Shares relate and to allocate the balance thereof to
paid-in capital of that Series, and to reallocate such amounts from time to
time; all as the Trustees may reasonably deem proper.
SECTION 3.5. Further Powers: Limitations. The Trustees shall have power
to do all such other matters and things, and to execute all such instruments,
as they deem necessary, proper or desirable in order to carry out, promote or
advance the interests of the Trust, although such matters or 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 of Trust, the presumption shall
be in favor of a grant of power to the Trustees. The Trustees shall not be
required to obtain any court order to deal with the Trust Property. The
Trustees may limit their right to exercise any of their powers through express
restrictive provisions in the instruments evidencing or providing the terms for
any Securities of the Trust or in other contractual instruments adopted on
behalf of the Trust.
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ARTICLE 4
TRUSTEES AND OFFICERS
SECTION 4.1. Number. Designation, Election. Term, etc.
(a) Initial Trustee. Upon his/her execution of this Agreement and
Declaration of Trust dated March 18, 1998 or a counterpart hereof or some other
writing in which he/she accepted such Trusteeship and agreed to the provisions
hereof, the individual whose signature is affixed thereto as Initial Trustee
became the Initial Trustee thereof.
(b) Number. The Trustees serving as such, whether named above or hereafter
becoming Trustees, may increase (to not more than eight (8)) or decrease the
number of Trustees to a number other than the number theretofore determined by
a written instrument signed by a Majority of the Trustees (or by an officer of
the Trust pursuant to the vote of a Majority of the Trustees). No decrease in
the number of Trustees shall have the effect of removing any Trustee from
office prior to the expiration of his or her term, but the number of Trustees
may be decreased in conjunction with the removal of a Trustee pursuant to
Section (e) of this Section 4.1.
(c) Election and Term. The Trustees shall be elected by the Shareholders of
the Trust at the first meeting of Shareholders immediately prior to the initial
issuance of shares of the Trust in a public offering and the term of office of
any Trustees in office before such election shall terminate at the time of such
election. Subject to Section 16(a) of the 1940 Act and to the preceding
sentence of this subsection (c) and to any requirements specified in the
By-Laws, the Trustees shall have the power to set and alter the terms of office
of the Trustees, and at any time to lengthen or shorten their own terms or make
their terms of unlimited duration, to elect their own successors and, pursuant
to subsection (f) of this Section 4.1, to appoint Trustees to fill vacancies;
provided that Trustees shall be elected by a Majority Shareholder Vote at any
such time or times as the Trustees shall determine that such action is required
under Section 16(a) of the 1940 Act or, if not so required, that such action is
advisable; and further provided that, after the initial election of Trustees by
the Shareholders, the term of office of any incumbent Trustee shall continue
until the termination of this Trust or his/her earlier death, resignation,
retirement, bankruptcy, adjudicated incompetency or other incapacity or
removal, or if not so terminated, until the election of such Trustee's
successor in office has become effective in accordance with this subsection
(c).
(d) Resignation and Retirement. Any Trustee may resign his/her trust or
retire as a Trustee, by a written instrument signed by him/her and delivered to
the other Trustees or to any officer of the Trust, and such resignation or
retirement shall take effect upon such delivery or upon such later date as is
specified in such instrument.
(e) Removal. Any Trustee may be removed: (i) by vote of shareholders
holding a majority of the Shares of the Trust then outstanding, cast in person
or by proxy at any meeting called for the purpose; or (ii) by a written
declaration signed by Shareholders holding not less than a majority of the
Shares of the Trust then outstanding.
(f) Vacancies. Any vacancy or anticipated vacancy resulting from any
reason, including an increase in the number of Trustees, may (but need not
unless required by the ▇▇▇▇ ▇▇▇) be filled by a Majority (or a supermajority if
required by the By-Laws) of the Trustees, subject to the provisions of Section
16(a) of the 1940 Act, through the appointment in writing of such other
individual as such remaining Trustees in their discretion shall determine;
provided that if there
10
shall be no Trustees in office, such vacancy or vacancies shall be filled by
Majority Shareholders Vote. Any such appointment or election shall be effective
upon such individual's written acceptance of his/her appointment as a Trustee
and his/her agreement to be bound by the provisions of this Declaration of
Trust, except that any such appointment in anticipation of a vacancy to occur
by reason of retirement, resignation or increase in the number of Trustees to
be effective at a later date shall become effective only at or after the
effective date of said retirement, resignation or increase in the number of
Trustees.
(g) Acceptance of Trusts. Whenever any conditions to the appointment or
election of any individual as a Trustee hereunder who was not, immediately
prior to such appointment or election, acting as a Trustee shall have been
satisfied, such individual shall become a Trustee and the Trust estate shall
vest in the new Trustee, together with the continuing Trustees, without any
further act or conveyance. Such new Trustee shall accept such appointment or
election in writing and agree in such writing to be bound by the provisions
hereof, but the execution of such writing shall not be requisite to the
effectiveness of the appointment or election of a new Trustee.
(h) Effect of Death. Resignation, etc. No vacancy, whether resulting from
the death, resignation, retirement, bankruptcy, adjudicated incompetency,
incapacity, or removal of any Trustee, an increase in the number of Trustees or
otherwise, shall operate to annul or terminate the Trust hereunder or to revoke
or terminate any existing agency or contract created or entered into pursuant
to the terms of this Declaration of Trust. Until such vacancy is filled as
provided in this Section 4.1, the Trustees in office (if any), regardless of
their number, shall have all the powers granted to the Trustees and shall
discharge all the duties imposed upon the Trustees by this Declaration. Upon
incapacity or death of any Trustee, his/her legal representative shall execute
and deliver on his/her behalf such documents as the remaining Trustees shall
require in order to effect the purpose of this Paragraph.
(i) Conveyance. In the event of the resignation or removal of a Trustee or
his/her otherwise ceasing to be a Trustee, such former Trustee or his/her legal
representative shall, upon request of the continuing Trustees, execute and
deliver such documents as may be required for the purpose of consummating or
evidencing the conveyance to the Trust or the remaining Trustees of any Trust
Property held in such former Trustee's name, but the execution and delivery of
such documents shall not be requisite to the vesting of title to the Trust
Property in the remaining Trustees, as provided in subsection (g) of this
Section 4.1 and in Section 4.13 hereof.
(j) No Accounting. Except to the extent required by the 1940 Act or under
circumstances which would justify his/her removal for cause, no Person ceasing
to be a Trustee (nor the estate of any such Person) shall be required to make
an accounting to the Shareholders or remaining Trustees upon such cessation.
SECTION 4.2. Trustees' Meetings: Participation by Telephone. etc. Annual
and special meetings may be held from time to time, in each case, upon the call
of such officers as may be thereunto authorized by the By-Laws or vote of the
Trustees, or by any three (3) Trustees, or pursuant to a vote of the Trustees
adopted at a duly constituted meeting of the Trustees, and upon such notice as
shall be provided in the By-Laws. Any such meeting may be held within or
without the state of Delaware. The Trustees may act with or without a meeting,
and a written consent to any matter, signed by all of the Trustees, shall be
equivalent to action duly taken at a meeting of the Trustees, duly called and
held. Except as otherwise provided by the 1940 Act or other applicable law, or
by this Declaration of Trust or the By-Laws, any action to be taken by the
Trustees may be taken by a majority of the Trustees present at a meeting of
Trustees (a quorum, consisting of at least a Majority of the Trustees, being
present), within or without Delaware. If authorized by the By-Laws, all or any
one or more Trustees may participate in a meeting of the Trustees or any
Committee thereof by means of conference telephone or similar means of
communication by means of which all Persons participating in the meeting can
hear each other, and participation in a meeting pursuant to such means of
communication shall constitute
11
presence in person at such meeting. The minutes of any meeting thus held shall
be prepared in the same manner as a meeting at which all participants were
present in person.
SECTION 4.3. Committees; Delegation. The Trustees shall have power,
consistent with their ultimate responsibility to supervise the affairs of the
Trust, to delegate from time to time to one or more other Committees, or to any
single Trustee, the doing of such things and the execution of such deeds or
other instruments, either in the name of the Trust or the names of the Trustees
or as their attorney or attorneys in fact, or otherwise as the Trustees may
from time to time deem expedient, and any agreement, deed, mortgage, lease or
other instrument or writing executed by the Trustee or Trustees or other Person
to whom such delegation was made shall be valid and binding upon the Trustees
and upon the Trust.
SECTION 4.4. Officers. The Trustees shall annually elect such officers or
agents, who shall have such powers, duties and responsibilities as the Trustees
may deem to be advisable, and as they shall specify by resolution or in the
By-Laws. Except as may be provided in the By-Laws, any officer elected by the
Trustees may be removed at any time with or without cause. Any two (2) or more
offices may be held by the same individual.
SECTION 4.5. Compensation of Trustees and Officers. The Trustees shall fix
the compensation of all officers and Trustees. Without limiting the generality
of any of the provisions hereof, the Trustees shall be entitled to receive
reasonable compensation for their general services as such, and to fix the
amount of such compensation, and to pay themselves or any one or more of
themselves such compensation for special services, including legal, accounting,
or other professional services, as they in good faith may deem reasonable. No
Trustee or officer resigning (except where a right to receive compensation for
a definite future period shall be expressly provided in a written agreement
with the Trust, duly approved by the Trustees) and no Trustee or officer
removed shall have any right to any compensation as such Trustee or officer for
any period following his/her resignation or removal, or any right to damages on
account of his/her removal, whether his/her compensation be by the month, or
the year or otherwise.
SECTION 4.6. Ownership of Shares and Securities of the Trust. Any Trustee,
and any officer, employee or agent of the Trust, and any organization in which
any such Person is interested, may acquire, own, hold and dispose of Shares of
any Series and other Securities of the Trust for his/her or its individual
account, and may exercise all rights of a holder of such Shares or Securities
to the same extent and in the same manner as if such Person were not such a
Trustee, officer, employee or agent of the Trust; subject, in the case of
Trustees and officers, to the same limitations as directors or officers (as the
case may be) of a Delaware business corporation; and the Trust may issue and
sell or cause to be issued and sold and may purchase any such Shares or other
Securities from any such Person or any such organization, subject only to the
general limitations, restrictions or other provisions applicable to the sale or
purchase of Shares of such Series or other Securities of the Trust generally.
SECTION 4.7. Right of Trustees and Officers to Own Property or to Engage in
Business; Authority of Trustees to Permit Others to Do Likewise. The Trustees,
in their capacity as Trustees, and (unless otherwise specifically directed by
vote of the Trustees) the officers of the Trust in their capacity as such,
shall not be required to devote their entire time to the business and affairs
of the Trust. Except as otherwise specifically provided by vote of the
Trustees, or by agreement in any particular case, any Trustee or officer of the
Trust may acquire, own, hold and dispose of, for his/her own individual
account, any property, and acquire, own, hold, carry on and dispose of, for
his/her own individual account, any business entity or business activity,
whether similar or dissimilar to any property or business entity or business
activity invested in or carried on by the Trust, and without first offering the
same as an investment opportunity to the Trust, and may exercise all rights in
respect thereof as if he/she were not a Trustee or officer of the Trust. The
Trustees shall also have power, generally or in specific cases, to permit
employees or agents of the Trust to have the
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same rights (or lesser rights) to acquire, hold, own and dispose of property
and businesses, to carry on businesses, and to accept investment opportunities
without offering them to the Trust, as the Trustees have by virtue of this
Section 4.7.
SECTION 4.8. Reliance on Experts. The Trustees and officers may consult
with counsel, engineers, brokers, appraisers, auctioneers, accountants,
investment bankers, securities analysts or other Persons (any of which may be a
firm in which one or more of the Trustees or officers is or are members or
otherwise interested) whose profession gives authority to a statement made by
them on the subject in question, and who are reasonably deemed by the Trustees
or officers in question to be competent, and the advice or opinion of such
Persons shall be full and complete personal protection to all of the Trustees
and officers in respect of any action taken or suffered by them in good faith
and in reliance on or in accordance with such advice or opinion. In discharging
their duties, Trustees and officers, when acting in good faith, may rely upon
financial statements of the Trust represented to them to be correct by any
officer of the Trust having charge of its books of account, or stated in a
written report by an independent certified public accountant fairly to present
the financial position of the Trust. The Trustees and officers may rely, and
shall be personally protected in acting, upon any instrument or other document
believed by them to be genuine.
SECTION 4.9. Surety Bonds. No Trustee, officer, employee or agent of the
Trust shall, as such, be obligated to give any bond or surety or other security
for the performance of any of his/her duties, unless required by applicable law
or regulation, or unless the Trustees shall otherwise determine in any
particular case.
SECTION 4.10. Apparent Authority of Trustees and Officers. No purchaser,
lender, transfer agent or other Person dealing with the Trustees or any officer
of the Trust shall be bound to make any inquiry concerning the validity of any
transaction purporting to be made by the Trustees or by such officer, or to
make inquiry concerning or be liable for the application of money or property
paid, loaned or delivered to or on the order of the Trustees or of such
officer.
SECTION 4.11. Other Relationships Not Prohibited. 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
(as defined in Section 5.2 hereof), 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 Series, or that
(ii) any Contracting Party may have a contract providing for the rendering
of any similar services to one or more other corporations, trusts,
associations, partnerships, limited partnerships or other organizations, or
have other business or interests, shall not affect the validity of any contract
for the performance and assumption of services, duties and responsibilities to,
for or of the Trust and/or the Trustees or disqualify any Shareholder, Trustee
or officer of the Trust from voting upon or executing the same or create any
liability or accountability to the Trust or to the holders of Shares of any
Series; 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 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 4.12. Payment of Trust Expenses. The Trustees are authorized to pay
or to cause to be paid out of the principal or income of the Trust, or partly
out of principal and partly out of income, and according to any allocation to
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a particular Series and Class made by them pursuant to Section 6.1(f) hereof,
all expenses, fees, charges, taxes and liabilities incurred or arising in
connection with the business and affairs of the Trust or in connection with the
management thereof, including, but not limited to, the Trustees' compensation
and such expenses and charges for the services of the Trust's officers,
employees, Investment Adviser, Administrator, Distributor, Principal
Underwriter, auditor, counsel, Custodian, Transfer Agent, Dividend Disbursing
Agent, Accounting Agent, Shareholder Servicing Agent, and such other agents,
consultants, and independent contractors and such other expenses and charges as
the Trustees may deem necessary or proper to incur.
SECTION 4.13. Ownership of the Trust Property. Legal title to all the Trust
Property shall be vested in the Trustees as joint tenants, except that the
Trustees shall have power to cause legal title to any Trust Property to be held
by or in the name of one or more of the Trustees, or in the name of the Trust,
or of any particular Series, or in the name of any other Person as nominee, on
such terms as the Trustees may determine; provided that the interest of the
Trust and of the respective Series therein is appropriately protected. The
right, title and interest of the Trustees in the Trust Property shall vest
automatically in each Person who may hereafter become a Trustee. Upon the
termination of the term of office of a Trustee as provided in Section 4.1(c),
(d) or (e) hereof, such Trustee shall automatically cease to have any right,
title or interest in any of the Trust Property, and the right, title and
interest of such Trustee in the Trust Property shall vest automatically in the
remaining Trustees. Such vesting and cessation of title shall be effective
whether or not conveyancing documents have been executed and delivered pursuant
to Section 4.1(i) hereof.
SECTION 4.14. By-Laws. The Trustees may adopt and from time to time amend
or repeal By-Laws for the conduct of the business of the Trust.
ARTICLE 5
DELEGATION OF MANAGERIAL RESPONSIBILITIES
SECTION 5.1. Appointment; Action by Less than All Trustees. The Trustees
shall be responsible for the general operating policy of the Trust and for the
general supervision of the business of the Trust conducted by officers, agents,
employees or advisers of the Trust or by independent contractors, but the
Trustees shall not be required personally to conduct all the business of the
Trust and, consistent with their ultimate responsibility as stated herein, the
Trustees may appoint, employ or contract with one or more officers, employees
and agents to conduct, manage and/or supervise the operations of the Trust, and
may grant or delegate such authority to such officers, employees and/or agents
as the Trustees may, in their sole discretion, deem to be necessary or
desirable, without regard to whether such authority is normally granted or
delegated by trustees. With respect to those matters of the operation and
business of the Trust which they shall elect to conduct themselves, except as
otherwise provided by this Declaration or the By-Laws, if any, the Trustees may
authorize any single Trustee or defined group of Trustees, or any committee
consisting of a number of Trustees less than the whole number of Trustees then
in office without specification of the particular Trustees required to be
included therein, to act for and to bind the Trust, to the same extent as the
whole number of Trustees could do, either with respect to one or more
particular matters or classes of matters, or generally.
SECTION 5.2. Certain Contracts. Subject to compliance with the provisions
of the 1940 Act, but notwithstanding any limitations of present and future law
or custom in regard to delegation of powers by trustees generally, the Trustees
may, at any time and from time to time in their discretion and without limiting
the generality of their powers and authority otherwise set forth herein, enter
into one or more contracts with any one or more corporations, trusts,
associations, partnerships, limited partnerships or other types of
organizations, or individuals ("Contracting Party"), to provide for the
performance and assumption of some or all of the following services, duties and
responsibilities to, for
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or on behalf of the Trust and/or any Series, and/or the Trustees, and to
provide for the performance and assumption of such other services, duties and
responsibilities in addition to those set forth below, as the Trustees may deem
appropriate:
(a) Advisory. An investment advisory or management agreement whereby the
agent shall undertake to furnish the Trust (or any Series thereof) such
management, investment advisory or supervisory, statistical and research
facilities and services, and such other facilities and services, if any, as
the Trustees shall from time to time consider desirable, all upon such
terms and conditions as the Trustees may in their discretion determine to
be not inconsistent with this Declaration, the applicable provisions of the
1940 Act or any applicable provisions of the By-Laws (any such agent being
herein referred to as an "Investment Adviser"). To the extent required by
the 1940 Act, regulations or exemptions thereunder, any such advisory or
management agreement and any amendment thereto shall be subject to approval
by a Majority Shareholder Vote at a meeting of the Shareholders of the
Trust (or applicable Series). Notwithstanding any provisions of this
Declaration, the Trustees may authorize the Investment Adviser (subject to
such general or specific instructions as the Trustees may from time to time
adopt) to effect purchases, sales, loans or exchanges of securities of the
Trust on behalf of the Trustees or may authorize any officer or employee of
the Trust or any Trustee to effect such purchases, sales, loans or
exchanges pursuant to recommendations of the Investment Adviser (and all
without further action by the Trustees). Any such purchases, sales, loans
and exchanges shall be deemed to have been authorized by all of the
Trustees. The Trustees may, in their sole discretion, call a meeting of
Shareholders in order to submit to a vote of Shareholders of the Trust (or
applicable Series) at such meeting the approval of continuance of any such
investment advisory or management agreement.
(b) Administration. An agreement whereby the agent, subject to the general
supervision of the Trustees and in conformity with any policies of the
Trustees with respect to the operations of the Trust and each Series
thereof, will supervise all or any part of the operations of the Trust (or
any Series thereof), and will provide all or any part of the administrative
and clerical personnel, office space and office equipment and services
appropriate for the efficient administration and operations of the Trust
(or any Series thereof) (any such agent being herein referred to as an
"Administrator").
(c) Underwriting. An agreement providing for the sale of Shares of the
Trust (or any Series thereof) to net the Trust not less than the net asset
value per Share (as described in Section 6.1(l) hereof) and pursuant to
which the Trust may appoint the other party to such agreement as its
principal underwriter or sales agent for the distribution of such Shares.
The agreement shall contain such terms and conditions as the Trustees may
in their discretion determine to be not inconsistent with this Declaration,
the applicable provisions of the 1940 Act and any applicable provisions of
the By-Laws (any such agent being herein referred to as a "Distributor" or
a "Principal Underwriter," as the case may be).
(d) Custodian. The appointment of an agent meeting the requirements for a
custodian for the assets of Investment Companies contained in the 1940 Act
as custodian of the Securities and cash of the Trust (or any Series
thereof) and of the accounting records in connection therewith (any such
agent being herein referred to as a "Custodian").
(e) Transfer and Dividend Disbursing Agent. An agreement with an agent to
maintain records of the ownership of outstanding Shares, the issuance and
redemption and the transfer thereof (any such agent being herein referred
to as a "Transfer Agent"), and to disburse any dividends declared by the
Trustees and in accordance with the policies of the Trustees and/or the
instructions of any particular Shareholder to reinvest any such dividends
(any such agent being herein referred to as a "Dividend Disbursing Agent").
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(f) Shareholder Servicing. An agreement with an agent to provide service
with respect to the relationship of the Trust and its Shareholders, records
with respect to Shareholders and their Shares, and similar matters (any
such agent being herein referred to as a "Shareholder Servicing Agent").
(g) Accounting. An agreement with an agent to handle all or any part of the
accounting responsibilities, whether with respect to the Trust's
properties, Shareholders or otherwise (any such agent being herein referred
to as an "Accounting Agent").
In addition, the Trustees may from time to time cause the Trust (or any Series
thereof) to enter into agreements with respect to such other services and upon
such other terms and conditions as they may deem necessary, appropriate or
desirable. The same Person may be the Contracting Party for some or all of the
services, duties and responsibilities to, for and of the Trust and/or the
Trustees, and the contracts with respect thereto may contain such terms
interpretive of or in addition to the delineation of the services, duties and
responsibilities provided for, including provisions that are not inconsistent
with the 1940 Act relating to the standard of duty of and the rights to
indemnification of the Contracting Party and others, as the Trustees may
determine. Nothing herein shall preclude, prevent or limit the Trust or a
Contracting Party from entering into subcontractual arrangements relative to
any of the matters referred to in subsections (a) through (g) of this Section
5.2.
Section 5.3. Distribution Arrangements. Subject to compliance with the 1940
Act, the Trustees may adopt and amend or repeal from time to time and implement
one or more plans of distribution pursuant to Rule 12b-1 of the 1940 Act which
plan(s) will provide for the payment of specified marketing, distribution and
shareholder relations expenses of the Trust and any or all Series and their
agents and the agents of such agents.
Section 5.4. Service Arrangements. Subject to compliance with the 1940
Act, the Trustees may adopt and amend or repeal from time to time and implement
one or more service plans which plans will provide for the payment of ongoing
services to holders of the shares of such Trust (or any Series thereof) and in
connection with the maintenance of such shareholders' accounts.
ARTICLE 6
SERIES AND SHARES
SECTION 6.1. Description of Series and Shares.
(a) General. The beneficial interest in the Trust shall be divided into
Shares (either full or fractional) with $.01 par value per Share, of which an
unlimited number may be issued. The Trustees shall have the authority from time
to time to establish and designate one or more separate, distinct and
independent Series of Shares (each of which Series shall represent interests
only in the asset attributed by the Trustees to such Series), and to authorize
separate Classes of Shares of the Trust (or any such Series), as they deem
necessary or desirable. All Shares shall be of one class, provided that the
Trustees shall have the power to classify or reclassify any unissued Shares of
any Series into any number of additional Classes of such Series.
(b) Establishment. etc. of Series and Classes; Authorization of Shares. The
establishment and designation of any Series and the authorization of the Shares
thereof shall be effective upon the execution by a Majority of the Trustees (or
by an officer of the Trust pursuant to the vote of a Majority of the Trustees)
of an instrument setting forth such establishment and designation and the
relative rights and preferences of the Shares of such Series or Class and the
manner in which the same may be amended (a "Certificate of Designation"), and
may provide that the number of Shares of such Series or Class which may be
issued is unlimited, or may limit the number issuable. At any time that there
are no Shares outstanding of any particular Series or Class previously
established and designated, the Trustees may by an instrument executed by a
Majority of the Trustees (or by an officer of the Trust pursuant to the vote of
a Majority of
16
the Trustees) terminate such Series or Class and the establishment and
designation thereof and the authorization of its Shares (a "Certificate of
Termination"). Each Certificate of Designation, Certificate of Termination and
any instrument amending a Certificate of Designation shall have the status of
an amendment to this Declaration of Trust.
(c) Character of Separate Series and Shares Thereof. Each Series
established hereunder shall represent beneficial interests in a separate
component of the assets of the Trust. Holders of Shares of a Series shall be
considered Shareholders of such Series, but such Shareholders shall also be
considered Shareholders of the Trust for purposes of receiving reports and
notices and, except as otherwise provided herein or in the Certificate of
Designation of a particular Series, or as required by the 1940 Act or other
applicable law, the right to vote, all without distinction by Series. The
Trustees shall have exclusive power without the requirement of Shareholder
approval to establish and designate such separate and distinct Series, and to
fix and determine the relative rights and preferences as between the shares of
the respective Series, and as between the Classes of the Trust (or any Series
thereof), as to rights 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 Shareholders of the several Series or the several
Classes of any Series of Shares shall have separate voting rights or no voting
rights. Except as otherwise provided as to a particular Series herein, or in
the Certificate of Designation therefor, the Trustees shall have all the rights
and powers, and be subject to all the duties and obligations, with respect to
each such Series and the assets and affairs thereof as they have under this
Declaration with respect to the Trust and the Trust Property in general.
Separate and distinct records shall be maintained for each Series of Shares and
the assets and liabilities attributable thereto.
(d) Consideration for Shares. The Trustees may issue Shares of the Trust
(or any Series thereof) for such consideration (which may include property
subject to, or acquired in connection with the assumption of, liabilities) and
on such terms as they may determine (or for no consideration if pursuant to a
Share dividend or split-up), all without action or approval of the
Shareholders. All Shares when so issued on the terms determined by the Trustees
shall be fully paid and nonassessable (but may be subject to mandatory
contribution back to the Trust (or applicable Series) as provided in Section
6.1(l) hereof. The Trustees may classify or reclassify any unissued Shares, or
any Shares of the Trust (or any Series thereof) previously issued and
reacquired by the Trust, into Shares of the Trust or one or more other Series
that may be established and designated from time to time.
(e) Assets Belonging to Series. Any portion of the Trust Property
allocated to a particular Series, and all consideration received by the Trust
for the issue or sale of Shares of such Series, together with all assets in
which such consideration is invested or reinvested, all interest, dividends,
income, earnings, profits and gains therefrom, and proceeds thereof, including
any proceeds derived from the sale, exchange or liquidation of such assets, and
any funds or payments derived from any reinvestment of such proceeds in
whatever form the same may be, shall be held by the Trustees in trust for the
benefit of the holders of Shares of that Series and shall irrevocably belong to
that Series for all purposes, and shall be so recorded upon the books of
account of the Trust, and the Shareholders of such Series shall not have, and
shall be conclusively deemed to have waived, any claims to the assets of any
Series of which they are not Shareholders. Such consideration, assets,
interest, dividends, income, earnings, profits, gains and proceeds, together
with any General Items allocated to that Series as provided in the following
sentence, are herein referred to collectively as assets "belonging to" that
Series. In the event that there are any assets, income, earnings, profits, and
proceeds thereof, funds, or payments which are not readily identifiable as
belonging to any particular Series (collectively, "General Items"), the
Trustees shall allocate such General Items to and among any one or more of the
Series established and designated from time to time in such manner and on such
basis as they, in their sole discretion, deem fair and equitable; and any
General Items so allocated to a particular Series shall belong to and be part
of the assets belonging to that Series. Each such allocation by the Trustees
shall be conclusive and binding upon the Shareholders of all Series for all
purposes.
(f) Liabilities of Series. The assets belonging to each particular Series
shall be charged with the liabilities in respect of that Series and all
expenses, costs, charges and reserves attributable to that Series, and any
general liabilities, expenses, costs, charges or reserves of the Trust which
are not readily identifiable as pertaining to any particular Series shall be
allocated and charged by the Trustees to and among any one or more of the
Series established and designated from time to time in such manner and on such
basis as the Trustees in their sole discretion deem fair and equitable. The
17
indebtedness, expenses, costs, charges and reserves allocated and so charged to
a particular Series are herein referred to as "liabilities of" that Series.
Each allocation of liabilities, expenses, costs, charges and reserves by the
Trustees shall be conclusive and binding upon the Shareholders of all Series
for all purposes. Any creditor of any Series may look only to the assets
belonging to that Series to satisfy such creditor's debt.
(g) Dividends. Dividends and distributions on Shares of a particular Series
may be paid with such frequency as the Trustees may determine, which may be
daily or otherwise pursuant to a standing resolution or resolutions adopted
only once or with such frequency as the Trustees may determine, to the
Shareholders of that Series, from such of the income, accrued or realized, and
capital gains, realized or unrealized, and out of the assets belonging to that
Series, as the Trustees may determine, after providing for actual and accrued
liabilities of that Series. All dividends and distributions on Shares of a
particular Series shall be distributed pro rata to the Shareholders of that
Series in proportion to the number of such Shares held by such holders at the
date and time of record established for the payment of such dividends or
distributions, except that the dividends and distributions of investment income
and capital gains with respect to each Class of Shares of a particular Series
shall be in such amount as may be declared from time to time by the Trustees,
and such dividends and distributions may vary as between such Classes to
reflect differing allocations of the expenses of the Series between the
Shareholders of such several Classes and any resultant differences between the
net asset value of such several Classes to such extent and for such purposes as
the Trustees may deem appropriate and further 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, or that
dividends or distributions shall be payable on Shares which have been tendered
by the holder thereof for redemption or repurchase, but the redemption or
repurchase proceeds of which have not yet been paid to such Shareholder. Such
dividends and distributions may be made in cash, property or Shares of any
Class of that Series or a combination thereof as determined by the Trustees, or
pursuant to any program that the Trustees may have in effect at the time for
the election by each Shareholder of the mode of the making of such dividend or
distribution to that Shareholder. Any such dividend or distribution paid in
Shares will be paid at the net asset value thereof as determined in accordance
with subsection (l) of this Section 6.1.
(h) Liquidation. In the event of the liquidation or dissolution of the
Trust (or any particular Series), the Shareholders of the Trust (or that
Series) shall be entitled to receive, when and as declared by the Trustees, the
excess of the assets belonging to the Trust (or that Series) over the
liabilities of such Series. The assets so distributable to the Shareholders of
the Trust (or that Series) shall be distributed among such Shareholders in
proportion to the number of Shares of the Trust (or that Series) held by them
and recorded on the books of the Trust. The liquidation of the Trust (or any
particular Series) may be authorized by vote of a Majority of the Trustees,
subject to the affirmative vote of "a majority of the outstanding voting
securities" of that Series, as the quoted phrase is defined in the 1940 Act,
determined in accordance with clause (iii) of the definition of "Majority
Shareholder Vote" in Section 1.4 hereof.
(i) Voting. The Shareholders shall have the voting rights set forth in or
determined under Article 7 hereof.
(j) Redemption by Shareholder. Each holder of Shares of the Trust (or a
particular Series thereof) shall have the right at such times as may be
permitted by the Trust, but no less frequently than required by the 1940 Act,
to require the Trust (or such Series) to redeem all or any part of his Shares
of the Trust (or such Series) at a redemption price equal to the net asset
value per Share of the Trust (or Series) next determined in accordance with
subsection (l) of this Section 6.1 after the Shares are properly tendered for
redemption; provided, that the Trustees may from time to time, in their
discretion, determine and impose a fee for such redemption and that the
proceeds of the redemption of Shares (including a fractional Share) of any
Class of the Trust (or any Series thereof) shall be reduced by the amount of
any applicable contingent deferred sales charge or other sales charge, if any,
payable on such redemption to the distributor of Shares of such Class pursuant
to the terms of the initial issuance of the Shares of such Class (to the extent
consistent with the 1940 Act or regulations or exemptions thereunder) and the
Trust shall promptly pay to such distributor the amount of such deferred sales
charge. Payment of the redemption price shall be in cash; provided, however,
that if the Trustees determine, which determination shall be conclusive, that
conditions exist which make payment wholly in cash unwise or undesirable, the
Trust may make payment wholly or partly in Securities or other assets belonging
to such Series at
18
the value of such Securities or assets used in such determination of net asset
value. Notwithstanding the foregoing, the Trust may postpone payment of the
redemption price and may suspend the right of the holders of Shares of the Trust
(or any Series thereof) to require the Trust to redeem Shares of the Trust (or
such Series) during any period or at any time when and to the extent permissible
under the 1940 Act.
(k) Redemption at the Option of the Trust. The Trustees shall have the
power to redeem Shares of the Trust (or any Series thereof) at a redemption
price determined in accordance with Section 6.1(j), if at any time (i) the
total investment in such account does not have a value of at least such minimum
amount as may be specified in the Prospectus for the Trust (or such Series)
from time to time (ii) the number of Shares held in such account is equal to or
in excess of a specified percentage of Shares of the Trust or any Series as set
forth from time to time in the applicable Prospectus. In the event the Trustees
determine to exercise their power to redeem Shares provided in this Section
6.1(k), the Shareholder shall be notified that the value of his/her account is
less than the applicable minimum amount and shall be allowed 30 days to make an
appropriate investment before redemption is processed.
(l) Net Asset Value. The net asset value per Share of the Trust (or any
Series or Class) at any time shall be the quotient obtained by dividing the
value of the net assets of the Trust (or such Series or Class) at such time
(being the current value of the assets belonging to the Trust (or such Series
or Class), less its then existing liabilities) by the total number of Shares of
the Trust (or such Series) then outstanding, all determined in accordance with
the methods and procedures, including without limitation those with respect to
rounding, established by the Trustees from time to time in accordance with the
requirements of the 1940 Act. The net asset value of the several Classes of the
Trust (or a particular Series) shall be separately computed, and may vary from
one another. The Trustees shall establish procedures for the allocation of
investment income or capital gains and expenses and liabilities of a particular
Series between the several Classes of the Trust (or such Series). The Trustees
may determine to maintain the net asset value per Share of the Trust or any
Series or Class at a designated constant dollar amount and in connection
therewith may adopt procedures not inconsistent with the 1940 Act for the
continuing declaration of income attributable to the Trust or such Series or
Class as dividends payable in additional Shares of the Trust or such Series or
Class at the designated constant dollar amount and for the handling of any
losses attributable to the Trust or such Series or Class. Such procedures may
provide that in the event of any loss each Shareholder shall be deemed to have
contributed to the shares of beneficial interest account of the Trust or such
Series or Class 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 the Trust or
such Series or Class to be maintained, after reflecting such loss, at the
designated constant dollar amount. Each Shareholder of the Trust shall be
deemed to have expressly agreed, by his/her investment in the Trust (or any
Series thereof) 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.
(m) Transfer. All Shares of the Trust and each Series shall be
transferable, but transfers of Shares of the Trust or a particular Series will
be recorded on the Share transfer records of the Trust applicable to the Trust
or such Series only at such times as Shareholders shall have the right to
require the Trust to redeem Shares of the Trust or such Series and at such
other times as may be permitted by the Trustees.
(n) Equality. All Shares of each particular Series shall represent an equal
proportionate interest in the assets belonging to that Series (subject to the
liabilities of that Series), and each Share of any particular Series shall be
equal to each other Share thereof; but the provisions of this sentence shall
not restrict any distinctions between the several Classes of a Series
permissible under this Section 6.1 or under Section 7. 1 hereof nor any
distinctions permissible under subsection (g) of this Section 6.1 that may
exist with respect to dividends and distributions on Shares of the same Series.
The Trustees may from time to time divide or combine the Shares of any class of
particular Series into a greater or lesser number of Shares of that class of a
Series without thereby changing the proportionate beneficial interest in the
assets belonging to that Series or in any way affecting the rights of the
holders of Shares of any other Series.
(o) Rights of Fractional Shares. Any fractional Share of the Trust (or any
Series thereof) shall carry proportionately all the rights and obligations of a
whole Share of the Trust (or such Series), including rights and obligations
with respect to voting, receipt of dividends and distributions, redemption of
Shares, and liquidation of the Trust or of the Series to which they pertain.
19
(p) Conversion Rights. (i) Subject to compliance with the requirements of
the 1940 Act, the Trustees shall have the authority to provide that holders of
Shares of any Series shall have the right to convert said Shares into Shares of
one or more other Series, that holders of any Class of the Trust or a Series of
Shares shall have the right to convert said Shares of such Class into Shares of
one or more other Classes of the Trust or such Series, and that Shares of any
Class of the Trust or a Series shall be automatically converted into Shares of
another Class of the Trust or such Series, in each case in accordance with such
requirements and procedures as the Trustees may establish.
(ii) The number of Shares of into which a convertible Share shall convert
shall equal the number (including for this purpose fractions of a Share)
obtained by dividing the net asset value per Share for purposes of sales and
redemptions of the converting Share on the Conversion Date by the net asset
value per Share for purposes of sales and redemptions of the Class of Shares
into which it is converting on the Conversion Date.
(iii) On the Conversion Date, the Share converting into another share will
cease to accrue dividends and will no longer be deemed outstanding and the
rights of the holders thereof (except the right to receive the number of target
Shares into which the converting Shares have been converted and declared but
unpaid dividends to the Conversion Date) will cease. Certificates representing
Shares resulting from the conversion need not be issued until certificates
representing Shares converted, if issued, have been received by the Trust or
its agent duly endorsed for transfer.
(iv) The Trust will appropriately reflect the conversion of Shares of one
Class of the Trust (or a Series thereof) into Shares of another Class of the
Trust (or such Series) on the first periodic statements of account sent to
Shareholders of record affected which provide account information with respect
to a reporting period which includes the date such conversion occurred.
SECTION 6.2. Ownership of Shares. The ownership of Shares shall be recorded
on the books of the Trust or of a Transfer Agent or similar agent for the
Trust, which books shall be maintained separately for the Shares of each Series
that has been authorized. Certificates evidencing the ownership of Shares need
not be issued except as the Trustees may otherwise determine from time to time,
and the Trustees shall have power to call outstanding Share certificates and to
replace them with book entries. The Trustees may make such rules as they
consider appropriate for the issuance of Share certificates, the use of
facsimile signatures, the transfer of Shares and similar matters. The record
books of the Trust as kept by the Trust or any Transfer Agent or similar agent,
as the case may be, shall be conclusive as to who are the Shareholders and as
to the number of Shares of the Trust and, if designated, each Series thereof
held from time to time by each such Shareholder.
The holders of Shares of the Trust and, if designated, each Series thereof
shall upon demand disclose to the Trustees in writing such information with
respect to their direct and indirect ownership of Shares of the Trust or, if
designated, such Series as the Trustees deem necessary to comply with the
provisions of the Internal Revenue Code, or to comply with the requirements of
any other authority.
SECTION 6.3. Investments in the Trust. The Trustees may accept investments
in any Series of the Trust from such Persons and on such terms and for such
consideration, not inconsistent with the provisions of the 1940 Act, as they
from time to time authorize. The Trustees may authorize any Distributor,
Principal Underwriter, Custodian, Transfer Agent or other Person to accept
orders for the purchase of Shares that conform to such authorized terms and to
reject any purchase orders for Shares, whether or not conforming to such
authorized terms.
SECTION 6.4. No Preemptive Rights. No Shareholder, by virtue of holding
Shares of the Trust or, if designated, any Series thereof, shall have any
preemptive or other right to subscribe to any additional Shares of the Trust or
such Series, or to any shares of any other Series, or any other Securities
issued by the Trust.
SECTION 6.5. Status of Shares. 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. Shares shall be deemed to
be personal property, giving only the rights provided herein. 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
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accounting, nor shall the ownership of Shares constitute the Shareholders
partners. The death of a Shareholder during the continuance of the Trust shall
not operate to terminate the Trust or any Series, 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 Declaration of Trust.
ARTICLE 7
SHAREHOLDERS' VOTING POWERS AND MEETINGS
SECTION 7.1. Voting Powers. The Shareholders shall have power to vote only
(i) for the election or removal of Trustees as provided in Sections 4.1(c) and
(e) hereof, (ii) with respect to the approval or termination in accordance with
the 1940 Act of any contract with a Contracting Party as provided in Section
5.2 hereof as to which Shareholder approval is required by the 1940 Act, (iii)
with respect to any termination or reorganization of the Trust or any Series to
the extent and as provided in Sections 9.2, 9.3 and 9.4 hereof, (iv) with
respect to any amendment of this Declaration of Trust to the extent and as
provided in Section 9.5 hereof, (v) to the same extent as the stockholders of a
Delaware business corporation as to whether or not a court action, proceeding
or claim should or should not be brought or maintained derivatively or as a
class action on behalf of the Trust or any Series, or the Shareholders of any
of them (provided. however, that a Shareholder of a particular Series shall not
in any event be entitled to maintain a derivative or class action on behalf of
any other Series or the Shareholders thereof), and (vi) with respect to such
additional matters relating to the Trust as may be required by the 1940 Act,
this Declaration of Trust, the By-Laws or any registration of the Trust with
the Commission (or any successor agency) or any State, or as the Trustees may
consider necessary or desirable. If and to the extent that the Trustees shall
determine that such action is required by law or by this Declaration, they
shall cause each matter required or permitted to be voted upon at a meeting or
by written consent of Shareholders to be submitted to a separate vote of the
outstanding Shares of each Series entitled to vote thereon; provided, that (i)
when expressly required by the 1940 Act or by other law, actions of
Shareholders shall be taken by Single Class Voting of all outstanding Shares
whose holders are entitled to vote thereon; and (ii) when the Trustees
determine that any matter to be submitted to a vote of Shareholders affects
only the rights or interests of Shareholders of one or more but not all Series
or of one or more but not all Classes of the Trust or a single Series
(including without limitation any distribution plan pursuant to Rule 12b-1 of
the 1940 Act applicable to such Class), then only the Shareholders of the
Series or Classes so affected shall be entitled to vote thereon. Any matter
required to be submitted to shareholders and affecting one or more Series shall
require separate approval by the required vote of Shareholders of the Trust or
each affected Series; provided, however, that to the extent required by the
1940 Act, there shall be no separate Series votes on the election or removal of
Trustees, the selection of auditors for the Trust and its Series or approval of
any agreement or contract entered into by the Trust or any Series. Shareholders
of a particular Series shall not be entitled to vote on any matter that affects
only one or more other Series.
SECTION 7.2. Number of Votes and Manner of Voting: Proxies. On each matter
submitted to a vote of the Shareholders, each holder of Shares of the Trust or,
if applicable, any Series shall be entitled to a number of votes equal to the
number of Shares of the Trust or such Series standing in his name on the books
of the Trust. There shall be no cumulative voting in the election or removal of
Trustees. Shares may be voted in person or by proxy. A proxy with respect to
Shares held in the name of two (2) or more Persons shall be valid if executed
by any one of them unless at or prior to exercise of the proxy the Trust
receives a specific written notice to the contrary from any one of them. A
proxy purporting to be executed by or on behalf of a Shareholder shall be
deemed valid unless challenged at or prior to its exercise and the burden of
proving invalidity shall rest on the challenger. Until Shares are issued, the
Trustees may exercise all rights of Shareholders and may take any action
required by law, this Declaration of Trust or the By-Laws to be taken by
Shareholders.
SECTION 7.3. Meetings. Meetings of Shareholders may be called by the
Trustees from time to time for the purpose of taking action upon any matter
requiring the vote or authority of the Shareholders as herein provided, or upon
any
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other matter deemed by the Trustees to be necessary or desirable. Written
notice of any meeting of Shareholders shall be given or caused to be given by
the Trustees by mailing such notice at least seven (7) days before such
meeting, postage prepaid, stating the time, place and purpose of the meeting,
to each Shareholder at the Shareholder's address as it appears on the records
of the Trust. The Trustees shall promptly call and give notice of a meeting of
Shareholders for the purpose of voting upon removal of any Trustee of the Trust
when requested to do so in writing by Shareholders holding not less than ten
percent (10%) of the Shares then outstanding. If the Trustees shall fail to
call or give notice of any meeting of Shareholders for a period of thirty (30)
days after written application by Shareholders holding at least ten percent
(10%) of the Shares then outstanding requesting that a meeting be called for
any other purpose requiring action by the Shareholders as provided herein or in
the By-Laws, then Shareholders holding at least ten percent (10%) of the Shares
then outstanding may call and give notice of such meeting, and thereupon the
meeting shall be held in the manner provided for herein in case of call thereof
by the Trustees. Any meetings may be held within or without The State of
Delaware. Shareholders may only act with respect to matters set forth in the
notice to Shareholders.
SECTION 7.4. Record Dates. For the purpose of determining the Shareholders
who are entitled to vote or act at any meeting or any adjournment thereof, or
who are entitled to participate in any dividend or distribution, or for the
purpose of any other action, the Trustees may from time to time close the
transfer books for such period, not exceeding thirty (30) days (except at or in
connection with the termination of the Trust), as the Trustees may determine;
or without closing the transfer books the Trustees may fix a date and time not
more than ninety (90) 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 any adjournment thereof or to
be treated as Shareholders of record for purposes of such other action, and any
Shareholder who was a Shareholder at the date and time so fixed shall be
entitled to vote at such meeting or any adjournment thereof or to be treated as
a Shareholder of record for purposes of such other action, even though he has
since that date and time disposed of his Shares, and no Shareholder becoming
such after that date and time shall be so entitled to vote at such meeting or
any adjournment thereof or to be treated as a Shareholder of record for
purposes of such other action.
SECTION 7.5. Quorum and Required Vote. A majority of the Shares entitled to
vote shall be a quorum for the transaction of business at a Shareholders'
meeting, but any lesser number shall be sufficient for adjournments. Any
adjourned session or sessions may be held within a reasonable time after the
date set for the original meeting without the necessity of further notice. A
Majority Shareholder Vote at a meeting of which a quorum is present shall
decide any question, except when a different vote is required or permitted by
any provision of the 1940 Act or other applicable law or by this Declaration of
Trust or the By-Laws, or when the Trustees shall in their discretion require a
larger vote or the vote of a majority or larger fraction of the Shares of one
or more particular Series.
SECTION 7.6. Action By Written Consent. Subject to the provisions of the
1940 Act and other applicable law, any action taken by Shareholders may be
taken without a meeting if a majority of Shareholders entitled to vote on the
matter (or such larger proportion thereof or of the Shares of any particular
Series as shall be required by the 1940 Act or by any express provision of this
Declaration of Trust or the By-Laws or as shall be permitted by the Trustees)
consent to the action in writing and if the writings in which such consent is
given are filed with the records of the meetings of Shareholders, to the same
extent and for the same period as proxies given in connection with a
Shareholders' meeting. Such consent shall be treated for all purposes as a
vote taken at a meeting of Shareholders.
SECTION 7.7. Inspection of Records. The records of the Trust shall be open
to inspection by Shareholders to the same extent as is permitted stockholders
of a Delaware business corporation under the Delaware business corporation law.
SECTION 7.8. Additional Provisions. The By-Laws may include further
provisions for Shareholders' votes and meetings and related matters not
inconsistent with the provisions hereof.
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ARTICLE 8
LIMITATION OF LIABILITY: INDEMNIFICATION
SECTION 8.1. Trustees. Shareholders. etc. Not Personally Liable; Notice.
The Trustees, officers, employees and agents of the Trust, in incurring any
debts, liabilities or obligations, or in limiting or omitting any other actions
for or in connection with the Trust, are or shall be deemed to be acting as
Trustees, officers, employees or agents of the Trust and not in their own
capacities. No Shareholder shall be subject to any personal liability
whatsoever in tort, contract or otherwise to any other Person or Persons in
connection with the assets or the affairs of the Trust or of any Series, and
subject to Section 8.4 hereof, no Trustee, officer, employee or agent of the
Trust shall be subject to any personal liability whatsoever in tort, contract,
or otherwise, to any other Person or Persons in connection with the assets or
affairs of the Trust or of any Series, save only that arising from his own
willful misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of his office or the discharge of his functions.
The Trust (or if the matter relates only to a particular Series, that Series)
shall be solely liable for any and all debts, claims, demands, judgments,
decrees, liabilities or obligations of any and every kind, against or with
respect to the Trust or such Series in tort, contract or otherwise in
connection with the assets or the affairs of the Trust or such Series, and all
Persons dealing with the Trust or any Series shall be deemed to have agreed
that resort shall be had solely to the Trust Property of the Trust or the
Series Assets of such Series, as the case may be, for the payment or
performance thereof.
The Trustees shall use their best efforts to ensure that every note, bond,
contract, instrument, certificate or undertaking made or issued by the Trustees
or by any officers or officer shall give notice that a Certificate of Trust in
respect of the Trust is on file with the Secretary of the state of Delaware and
shall recite to the effect that the same was executed or made by or on behalf
of the Trust or by them as Trustees or Trustee or as officers or officer, and
not individually, and that the obligations of such instrument are not binding
upon any of them or the Shareholders individually but are binding only upon the
assets and property of the Trust, or the particular Series in question, as the
case may be, but the omission thereof shall not operate to bind any Trustees or
Trustee or officers or officer or Shareholders or Shareholder individually, or
to subject the Series Assets of any Series to the obligations of any other
Series.
SECTION 8.2. Trustees' Good Faith Action; Expert Advice: No Bond or Surety.
The exercise by the Trustees of their powers and discretions hereunder shall be
binding upon everyone interested. Subject to Section 8.4 hereof, a Trustee
shall be liable for his/her own willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of the
office of Trustee, and for nothing else, and shall not be liable for errors of
judgment or mistakes of fact or law. Subject to the foregoing, (i) the Trustees
shall not be responsible or liable in any event for any neglect or wrongdoing
of any officer, agent, employee, consultant, Investment Adviser, Administrator,
Distributor or Principal Underwriter, Custodian or Transfer Agent, Dividend
Disbursing Agent, Shareholder Servicing Agent or Accounting Agent of the Trust,
nor shall any Trustee be responsible for the act or omission of any other
Trustee; (ii) the Trustees may take advice of counsel or other experts with
respect to the meaning and operation of this Declaration of Trust and 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 (iii) in
discharging their duties, the Trustees, when acting in good faith, shall be
entitled to rely upon the books of account of the Trust and upon written
reports made to the Trustees by any officer appointed by them, any independent
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 5.2 hereof. The Trustees as such
shall not be required to give any bond or surety or any other security for the
performance of their duties.
SECTION 8.3. Indemnification of Shareholders. If any Shareholder (or former
Shareholder) 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, the Trust (upon proper and timely request by the
Shareholder) may assume the defense against such charge and satisfy any
judgment thereon or may reimburse the Shareholders for expenses, and the
Shareholder or former Shareholder (or the heirs, executors, administrators or
other legal representatives thereof, or in the case of a corporation or other
entity, its corporate or other general successor) shall be entitled (but solely
out of the assets of the Series of which such Shareholder or former Shareholder
is or was the holder of Shares) to be held harmless from and indemnified
against all loss and expense arising from such liability.
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SECTION 8.4. Indemnification of Trustees. Officers, etc. Subject to the
limitations, if applicable, hereinafter set forth in this Section 8.4, the
Trust shall indemnify (from the assets of one or more Series to which the
conduct in question relates) each of its Trustees, officers, employees and
agents (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, together with
such Person's heirs, executors, administrators or personal representative,
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 Covered Person may be or may have been threatened, while in office or
thereafter, by reason of being or having been such a Trustee or officer,
director or trustee, except with respect to any matter as to which it has been
determined that such Covered Person (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; (ii) had acted with willful misfeasance, bad
faith, gross negligence or reckless disregard of the duties involved in the
conduct of such Covered Person's office (iii) for a criminal proceeding, had
reasonable cause to believe that his conduct was unlawful (the conduct
described in (i), (ii) and (iii) being referred to hereafter as "Disabling
Conduct"). A determination that the Covered Person is entitled to
indemnification may be made by (i) a final decision on the merits by a court or
other body before whom the proceeding was brought that the Covered 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 (the
"Disinterested Trustees"), or (b) an independent legal counsel in a written
opinion. Expenses, including accountants' and counsel fees so incurred by any
such Covered Person (but excluding amounts paid in satisfaction of judgments,
in compromise or as fines or penalties), may be paid from time to time by one
or more Series to which the conduct in question related 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 such Series if it
is ultimately determined that indemnification of such expenses is not
authorized under this Article 8 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, 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 that
the Covered Person ultimately will be found entitled to indemnification.
SECTION 8.5. Compromise Payment. As to any matter disposed of by a
compromise payment by any such Covered Person referred to in Section 8.4
hereof, pursuant to a consent decree or otherwise, no such indemnification
either for said payment or for any other expenses shall be provided unless such
indemnification shall be approved (i) by a majority of a quorum of the
Disinterested Trustees or (ii) by an independent legal counsel in a written
opinion. Approval by the Trustees pursuant to clause (i) or by independent
legal counsel pursuant to clause (ii) shall not prevent the recovery from any
Covered Person of any amount paid to such Covered Person in accordance with
either of such clauses as indemnification if such Covered Person is
subsequently adjudicated by a court of competent jurisdiction not to have acted
in good faith in the reasonable belief that such Covered Person's action was in
or not opposed to the best interests of the Trust or to have been liable to the
Trust or its Shareholders by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of the
Covered Person's office.
SECTION 8.6. Indemnification Not Exclusive, etc. The right of
indemnification provided by this Article 8 shall not be exclusive of or affect
any other rights to which any such Covered Person or shareholder may be
entitled. As used in this Article 8, a "disinterested" Person is one against
whom none of the actions, suits or other proceedings in question, and no other
action, suit or other proceeding on the same or similar grounds is then or has
been pending or threatened. Nothing contained in this Article 8 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.
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SECTION 8.7. Liability of Third Persons Dealing with Trustees. No person
dealing with the Trustees shall be bound to make any inquiry concerning the
validity of any transaction made or to be made by the Trustees or to see to the
application of any payments made or property transferred to the Trust or upon
its order.
ARTICLE 9
DURATION: REORGANIZATION: INCORPORATION; AMENDMENTS
SECTION 9.1. Duration of Trust. Unless terminated as provided herein, the
Trust shall have perpetual existence.
SECTION 9.2. Termination of Trust. The Trust may be terminated at any time
by a Majority of the Trustees, subject to the favorable vote of the holders of
not less than a majority of the Shares outstanding and entitled to vote of each
Series of the Trust, 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, or by such greater or different vote of Shareholders of any Series as
may be established by the Certificate of Designation by which such Series was
authorized. Upon termination, after paying or otherwise providing for all
charges, taxes, expenses and liabilities, whether due or accrued or anticipated
as may be determined by the Trustees, the Trust shall in accordance with such
procedures as the Trustees consider appropriate reduce the remaining assets to
distributable form in cash, Securities or other property, or any combination
thereof, and distribute the proceeds to the Shareholders, in conformity with
the provisions of Section 6.1(h) hereof. After termination of the Trust or any
Series and distribution to the Shareholders as herein provided, a majority of
the Trustees shall execute and lodge among the records of the Trust an
instrument in writing setting forth the fact of such termination. Upon
termination of the Trust, the Trustees shall thereupon be discharged from all
further liabilities and duties hereunder, and the rights and interests of all
Shareholders shall thereupon cease. Upon termination of any Series, the
Trustees shall thereupon be discharged from all further liabilities and duties
with respect to such Series, and the rights and interests of all Shareholders
of such Series shall thereupon cease.
SECTION 9.3. Reorganization. The Trustees may sell, convey and transfer all
or substantially all of the assets of the Trust, or the assets belonging to any
one or more Series, to another trust, partnership, association, corporation or
other entity organized under the laws of any state of the United States, or may
transfer such assets to another Series of the Trust, in exchange for cash,
Shares or other Securities (including, in the case of a transfer to another
Series of the Trust, Shares of such other Series), or to the extent permitted
by law then in effect may merge or consolidate the Trust or any Series with any
other Trust or any corporation, partnership, or association organized under the
laws of any state of the United States, all upon such terms and conditions and
for such consideration when and as authorized by vote or written consent of a
Majority 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 of each
Series whose assets are affected by such transaction, 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, and/or by such other vote of any Series as
may be established by the Certificate of Designation with respect to such
Series. Following such transfer, the Trustees shall distribute the cash, Shares
or other Securities or other consideration received in such transaction (giving
due effect to the assets belonging to and indebtedness of, and any other
differences among, the various Series of which the assets have so been
transferred) among the Shareholders of the Series of which the assets have been
so transferred; and if all of the assets of the Trust have been so transferred,
the Trust shall be terminated. Nothing in this Section 9.3 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
other organizations, and to sell, convey or transfer less than substantially
all of the Trust Property or the assets belonging to any Series to such
organizations or entities.
SECTION 9.4. Incorporation. Upon approval by Majority Shareholder Vote,
the Trustees may cause to be organized or assist in organizing a corporation or
corporations under the laws of any jurisdiction or any other trust,
partnership, association or other organization to take over all of the Trust
Property or to carry on any business in which the Trust shall directly or
indirectly have any interest, and to sell, convey and transfer the Trust
Property to any such
25
corporation, trust, association or organization, in exchange for the shares or
securities thereof, or otherwise, and to lend money to, subscribe for the
shares of securities of, and enter into any contracts with any such
corporation, trust, partnership, association or organization in which the Trust
holds or is about to acquire shares or any other interests. The Trustees may
also cause a merger or consolidation between the Trust or any successor thereto
and any such corporation, trust, partnership, association or other organization
if and to the extent permitted by law, as provided under the law then in
effect. Nothing contained herein shall be construed as requiring approval of
Shareholders for the Trustees to organize or assist in organizing one or more
corporation, trusts, partnerships, associations or other organizations and
selling, conveying or transferring a portion of the Trust Property to such
organizations or entities.
SECTION 9.5. Amendments; etc. All rights granted to the Shareholders under
this Declaration of Trust are granted subject to the reservation of the right
to amend this Declaration of Trust as herein provided, except that no amendment
shall repeal the limitations on personal liability of any Shareholder or
Trustee or the prohibition of assessment upon the Shareholders (otherwise than
as permitted under Section 6.1(l)) without the express consent of each
Shareholder or Trustee involved. Subject to the foregoing, the provisions of
this Declaration of Trust (whether or not related to the rights of
Shareholders) may be amended at any time, so long as such amendment does not
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 Trustees (or by an officer of the Trust
pursuant to the vote of a Majority of the Trustees). Any amendment to this
Declaration of Trust that adversely affects the rights of all Shareholders may
be adopted at any time by an instrument in writing signed by a Majority of the
Trustees (or by an officer of the Trust pursuant to a vote of a Majority of the
Trustees) when authorized to do so by the vote in accordance with Section 7. I
hereof of Shareholders holding a majority of all the Shares outstanding and
entitled to vote, without regard to Series, or if said amendment adversely
affects the rights of the Shareholders of less than all of the Series, by the
vote of the holders of a majority of all the Shares entitled to vote of each
Series so affected. Notwithstanding any other provisions set forth in this
Declaration of Trust, a provision in this Declaration of Trust requiring
shareholder approval of any action may be amended only with like shareholder
approval.
SECTION 9.6. Filing of Copies of Declaration and Amendments. The original
or a copy of this Declaration and of each amendment hereto (including each
Certificate of Designation and Certificate of Termination) shall be kept at the
office of the Trust where it may be inspected by any Shareholder. A restated
Declaration, integrating into a single instrument all of the provisions of this
Declaration which are then in effect and operative, may be executed from time
to time by a Majority of the Trustees and shall, upon execution, be conclusive
evidence of all amendments contained therein and may thereafter be referred to
in lieu of the original Declaration and the various amendments thereto. A
Certificate of Trust shall be filed in the office of the Secretary of State of
the State of Delaware.
ARTICLE 10
MISCELLANEOUS
SECTION 10.1. Notices. Any and all notices to which any Shareholder
hereunder may be entitled and any and all communications shall be deemed duly
served or given if mailed, postage prepaid, addressed to any Shareholder of
record at his last known address as recorded on the applicable register of the
Trust.
SECTION 10.2. Governing Law. This Declaration of Trust is, with reference
to the laws thereof, and the rights of all parties and the construction and
effect of every provision hereof shall be, subject to and construed according
to the laws of said The State of Delaware.
SECTION 10.3. Counterparts. This Declaration of Trust and any amendment
thereto may be simultaneously executed in several counterparts, each of which
so executed shall be deemed to be an original, and such counterparts, together,
shall constitute but one and the same instrument, which shall be sufficiently
evidenced by any such original counterpart.
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SECTION 10.4. Reliance by Third Parties. Any certificate executed by an
individual who, according to the records of the Trust is a Trustee hereunder,
certifying to: (a) the number or identity of Trustees or Shareholders, (b) the
due authorization of the execution of any instrument or writing, (c) the form
of any vote passed at a meeting of Trustees or Shareholders, (d) the fact that
the number of Trustees or Shareholders present at any meeting or executing any
written instrument satisfies the requirements of this Declaration of Trust, (e)
the form of any By-Law adopted, or the identity of any officers elected, by the
Trustees, (f) the existence or nonexistence of any fact or facts which in any
manner relate to the affairs of the Trust, or (g) the name of the Trust or the
establishment of a Series shall be conclusive evidence as to the matters so
certified in favor of any Person dealing with the Trustees, or any of them, and
the successors of such Person.
SECTION 10.5. References; Headings. The masculine gender shall include the
feminine and neuter genders. Headings are placed herein for convenience of
reference only and shall not be taken as a part of this Declaration or control
or affect the meaning, construction or effect hereof.
SECTION 10.6. Provisions in Conflict With Law or Regulation. (a) The
provisions of this Declaration are severable, and if the Trustees shall
determine, with the advice of counsel, that any of such provisions is in
conflict with the 1940 Act, the regulated investment company provisions of the
Internal Revenue Code of 1986 or with other applicable laws and regulations,
the conflicting provision shall be deemed never to have constituted a part of
this Declaration; provided, however, that such determination shall not affect
any of the remaining provisions of this Declaration or render invalid or
improper any action taken or omitted prior to such determination.
(b) If any provision of this Declaration 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 in any jurisdiction.
SECTION 10.7. Use of the Name "American General". The Trust acknowledges
that it is adopting its name through permission of American General Corporation
(hereinafter referred to as "American General") and agrees that if American
General or a successor to its business (whether such succession be by merger,
consolidation, purchase of assets or otherwise) or a subsidiary thereof should,
at any time and for any cause, cease to be the investment adviser to the Trust,
the Trust shall at the written request of American General and/or any such
successor eliminate the name "American General" from the Trust's corporate name
and from the designations of its shares and will not thereafter use the name
"American General" in any form or combination whatsoever in the conduct of the
Trust's business. The Trust further acknowledges that American General and its
subsidiaries reserve the right to grant the non-exclusive right to use the name
"American General" to any other corporation, including other investment
companies, whether now in existence or hereafter created. The foregoing
agreements on the part of the Trust are hereby made binding upon it, its
trustees, officers, shareholders, creditors and all other persons claiming
under or through it.
IN WITNESS WHEREOF, the undersigned, being the initial Trustee, has set her
hand and seal, for herself and her assigns, unto this Declaration of Trust of
the Trust, as of the day and year first above written.
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
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Initial Trustee
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A C K N O W L E D G M E N T
STATE OF TEXAS )
) ss
COUNTY OF ▇▇▇▇▇▇ )
March 16, 1998
(Date)
Then personally appeared the above named individual and acknowledged
the foregoing instrument to be her free act and deed.
Before me,
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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(Notary Public)
My commission expires: 6/27/99
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[Notary Seal]
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Notary Public, State of Texas
My Commission Expires
June 27, 1999
28
