ALLIANCE TAX-EXEMPT RESERVES
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AGREEMENT AND DECLARATION OF TRUST
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Dated: April 16, 1985
ALLIANCE TAX-EXEMPT RESERVES
AGREEMENT AND DECLARATION OF TRUST
Index
Page
RECITALS
ARTICLE I. THE TRUST 2
Section 1.1 Name 2
Section 1.2 Location 2
Section 1.3 Nature of Trust 3
Section 1.4 Definitions 3
Section 1.5 Real Property to be Converted into
Personal Property 7
ARTICLE II. PURPOSE OF THE TRUST 8
ARTICLE III. POWERS OF THE TRUSTEES 8
Section 3.1 Powers in General 8
(a) Investments 10
(b) Disposition of Assets 10
(c) Ownership Powers 10
(d) Form of Holding 10
(e) Reorganization, etc. 11
(f) Voting Trusts, etc. 11
(g) Contracts, etc. 11
(h) Guarantees, etc. 11
(i) Partnerships, etc. 11
(j) Insurance. 12
(k) Pensions, etc. 12
(l) Power of Collection and Litigation 12
(m) Issuance and Repurchase of Shares 13
(n) Offices 13
(o) Expenses 13
(p) Agents, etc. 13
(q) Accounts 13
(r) Valuation 13
(s) Indemnification 14
(t) General 14
Section 3.2 Borrowings; Financings; Issuance of
Securities 14
Section 3.3 Deposits 15
Section 3.4 Allocations 15
Section 3.5 Further Powers; Limitations 15
ARTICLE IV. TRUSTEES AND OFFICERS 16
Section 4.1 Number, Designation, Election, Term, etc. 16
(a) Initial Trustee 16
(b) Number 16
(c) Election and ▇▇▇▇ ▇▇
(▇) Resignation and Retirement 17
(e) Removal 17
(f) Vacancies 17
(g) Acceptance of Trusts 18
(h) Effect of Death, Resignation, etc. 18
(i) Conveyance 18
(j) No Accounting 19
(k) Filings 19
Section 4.2 Trustees' Meetings; Participation by
Telephone, etc 19
Section 4.3 Committees; Delegation 20
Section 4.4 Officers 20
Section 4.5 Compensation of Trustees and Officers 20
Section 4.6 Ownership of Shares and Securities of
the Trust 21
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 21
Section 4.8 Reliance on Experts 22
Section 4.9 Surety Bonds 22
Section 4.10 Apparent Authority of Trustees and Officers 22
Section 4.11 Other Relationships Not Prohibited 22
Section 4.12 Payment of Trust Expenses 23
Section 4.13 Ownership of the Trust Property 24
ARTICLE V. DELEGATION OF MANAGERIAL RESPONSIBILITIES 24
Section 5.1 Appointment; Action by Less than all Trustees 24
Section 5.2 Certain Contracts 25
(a) Advisory 25
(b) Administration 26
(c) Distribution 26
(d) Custodian 26
(e) Transfer and Dividend Disbursing Agency 27
(f) Shareholder Servicing 27
(g) Accounting 27
ARTICLE VI. FUNDS AND SHARES 28
Section 6.1 Description of Funds and Shares 28
(a) Shares; Funds; Series of Shares 28
(b) Establishment, etc. of Funds;
Authorization of Shares 28
(c) Character of Separate Funds and
Shares Thereof 29
(d) Consideration for Shares 29
Section 6.2 Establishment and Designation of the
Tax-Exempt Reserves Fund; General
Provisions for All Funds 30
(a) Assets Belonging to Funds 30
(b) Liabilities of Funds 31
(c) Dividends 31
(d) Liquidation 32
(e) Voting 32
(f) Redemption by Shareholder 32
(g) Redemption at the Option of the Trust 33
(h) Net Asset Value 33
(i) Transfer 34
(j) Equality 34
(k) Rights of Fractional Shares 34
(l) Conversion Rights 35
Section 6.3 Ownership of Shares 35
Section 6.4 Investments in the Trust 35
Section 6.5 No Pre-emptive Rights 35
Section 6.6 Status of Shares 36
ARTICLE VII. SHAREHOLDERS' VOTING POWERS AND MEETINGS 36
Section 7.1 Voting Powers 36
Section 7.2 Number of Votes and Manner of Voting;
Proxies 37
Section 7.3 Meetings 37
Section 7.4 Record Dates 38
Section 7.5 Quorum and Required Vote 38
Section 7.6 Action by Written Consent 38
Section 7.7 Inspection of Records 39
Section 7.8 Additional Provisions 39
ARTICLE VIII. LIMITATION OF LIABILITY; INDEMNIFICATION 39
Section 8.1 Trustees, Shareholders, etc. Not Personally
Liable; Notice 39
Section 8.2 Trustees' Good Faith Action Expert Advice;
No Bond or Surety 40
Section 8.3 Indemnification of Shareholders 41
Section 8.4 Indemnification of Trustees, Officers, etc. 41
Section 8.5 Compromise Payment 42
Section 8.6 Indemnification Not Exclusive, etc. 43
Section 8.7 Liability of Third Persons Dealing with
Trustees 43
ARTICLE IX DURATION; REORGANIZATION; AMENDMENTS 43
Section 9.1 Duration and Termination of Trust 43
Section 9.2 Reorganization 44
Section 9.3 Amendments; etc. 44
Section 9.4 Filing of Copies of Declaration and
Amendments 45
ARTICLE X MISCELLANEOUS 46
Section 10.1 Governing Law 46
Section 10.2 Counterparts 46
Section 10.3 Reliance by Third Parties 46
Section 10.4 References; Headings 46
Section 10.5 Use of the Name "Alliance" 46
Signatures 47
Acknowledgments 48
AGREEMENT AND DECLARATION OF TRUST
OF
ALLIANCE TAX-EXEMPT RESERVES
This AGREEMENT AND DECLARATION OF TRUST, made at
Boston, Massachusetts this 16th day of April, 1985, by and
between 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, ▇▇▇▇ ▇▇▇▇, an individual residing in
Manchester, Massachusetts (the "Settlor"), proposes to
deliver to the Initial Trustee the sum of one hundred
dollars ($100.00) lawful money of the United States of
America in trust hereunder and to authorize the Initial
Trustee and all other Persons acting as Trustees hereunder
to employ such funds, and any other funds coming into their
hands or the hands of their successor or successors as such
Trustees, to carry on the business of an investment company,
and as such of buying, selling, investing in or otherwise
dealing in and with stocks, bonds, debentures, warrants,
options, future contracts and other securities and interests
therein, or calls or puts with respect to any of the same,
or such other and further investment media and other
property as the Trustees may deem advisable, which are not
prohibited by law or the terms of this Declaration; and
WHEREAS, the Initial Trustee is willing to accept
such sum, together with any and all additions thereto and
the income or increments thereof, upon the terms, conditions
and trusts hereinafter set forth; and
WHEREAS, it is proposed that the assets held by the
Trustees be divided into separate funds, each with its own
separate investment portfolio, investment objectives,
policies and purposes, and that the beneficial interest in
each such fund shall be divided into transferable Shares of
Beneficial Interest, a separate Series of Shares for each
fund, all in accordance with the provisions hereinafter set
forth; and
WHEREAS, it is desired that the trust established
hereby (the "Trust") be managed and operated as a trust with
transferable shares under the laws of Massachusetts, of the
type commonly known as and referred to as a Massachusetts
business trust, in accordance with the provisions
hereinafter set forth,
1
NOW, THEREFORE, the Initial Trustee, for himself
and his successors as Trustees, hereby declares, and agrees
with the Settlor, for himself and for all Persons who shall
hereafter become holders of Shares of Beneficial Interest of
the Trust, of any Series, that the Trustees will hold the
sum delivered to them upon the execution hereof, and all
other and further cash, securities and other property of
every type and description which they may in any way acquire
in their capacity as such Trustees, together with the income
therefrom and the proceeds thereof, IN TRUST NEVERTHELESS,
to manage and dispose of the same for the benefit of the
holders from time to time of the Shares of Beneficial
Interest of the several Series being issued and to be issued
hereunder and in the manner and subject to the provisions
hereof, to wit:
ARTICLE I
THE TRUST
SECTION 1.1. Name. The name of the Trust shall be
"ALLIANCE TAX-EXEMPT RESERVES",
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 Beneficial
Interest of the Trust, of 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 10.5 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 have an
office in Boston, Massachusetts, unless changed by the
Trustees to another location in Massachusetts or elsewhere,
but such office need not be the sole or principal office of
the Trust. The Trust may have such other offices or places
of business as the Trustees may from time to time determine
to be necessary or expedient.
2
SECTION 1.3. Nature of Trust. The Trust shall be
a trust with transferable shares under the laws of The
Commonwealth of Massachusetts, of the type referred to in
Section 1 of Chapter 182 of the Massachusetts General Laws
and commonly termed a Massachusetts 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.
"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.
"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.
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References in this Agreement and Declaration of Trust to
"hereof", "herein" and "hereunder" shall be deemed to refer
to the Declaration of Trust generally, end 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.
"Fund" or "Funds" shall mean one or more of the
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 VI hereof.
"Fund Assets" shall have the meaning defined in
Section 6.2(a) 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 Advisor" shall have the meaning stated
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 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, and
as used with respect to 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
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(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 Fund,
"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 Fund) entitled to vote on such action which
satisfies such 1940 Act voting requirement.
"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 any Fund or
Series of Shares, shall mean the prospectus relating to such
Fund or 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 mean any and all bills, notes,
bonds, debentures or other obligations or evidences of
indebtedness, certificates of deposit, bankers' acceptances,
commercial paper, repurchase agreements or other money
market instruments; stocks, shares or other equity ownership
interests; and warrants, options or other instruments
representing rights to subscribe for, purchase, receive or
otherwise acquire or to sell, transfer, assign or otherwise
5
dispose of, and scrip, certificates, receipts or other
instruments evidencing any ownership rights or interests in,
any of the foregoing and "when issued" and "delayed
delivery" contracts for securities, issued, guaranteed or
sponsored by any governments, political subdivisions or
governmental authorities, agencies or instrumentalities, by
any individuals, firms, companies, corporations, syndicates,
associations or trusts, or by any other organizations or
entities whatsoever, irrespective of their forms or the
names by which they may be described, whether or not they be
organized and operated for profit, and whether they be
domestic or foreign with respect to The Commonwealth of
Massachusetts or the United States of America.
"Securities of the Trust" shall mean any Securities
issued by the Trust.
"Series" shall mean one or more of the series of
Shares authorized by the Trustees to represent the
beneficial interest in one or more of the Funds.
"Settlor" shall have the meaning stated in the
first "Whereas" clause set forth above.
"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 Fund 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
Fund shall be deemed to apply to outstanding Shares without
regard to Series.
"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 name on
the records of the Trust, irrespective of Series, and all
outstanding Shares of all Series vote as a single class.
6
"Statement of Additional Information," as used with
respect to any Fund or Series of Shares shall mean the
statement of additional information relating to such Fund or
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.
"Trust" shall have the meaning stated in the fourth
"whereas" clause set forth above.
"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
Fund to which such property is allocated.
"Trustees" shall mean, collectively, the Initial
Trustee, so long as he 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
(1) 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.
7
ARTICLE II
PURPOSE OF THE TRUST
The purpose of the Trust shall be to engage in the
business of being an investment company, and as such of
subscribing for, purchasing or otherwise acquiring, holding
for investment or trading in, borrowing, lending and selling
short, selling, assigning, negotiating or exchanging and
otherwise disposing of, and turning to account, realizing
upon and generally dealing in and with, in any manner,
(a) Securities of all kinds, (b) precious metals and other
minerals, contracts to purchase and sell, and other
interests of every nature and kind in, such metals or
minerals, and (c) rare coins and other numismatic items, and
all as the Trustees in their discretion shall determine to
be necessary, desirable or appropriate, and to exercise and
perform any and every act, thing or power necessary,
suitable or desirable for the accomplishment of such
purpose, the attainment of any of the objects or the
furtherance of any of the powers given hereby which are
lawful purposes, objects or powers of a trust with
transferable shares of the type commonly termed a
Massachusetts business trust; and to do every other act or
acts or thing or things incidental or appurtenant to or
growing out of or in connection with the aforesaid objects,
purposes or powers, or any of them, which a trust of the
type commonly termed a Massachusetts business trust is not
now or hereafter prohibited from doing, exercising or
performing.
ARTICLE III
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, the Trustees may adopt By-Laws not inconsistent
with this Declaration of Trust providing for the conduct of
the business and affairs of the Trust and may amend and
8
repeal them to the extent that such By-Laws do not reserve
that right to the Shareholders; 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 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 Funds to which
they may allocate such of the Trust Property, subject to
such liabilities, as they shall deem appropriate, each such
Fund 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 Advisors, Administrators and
Custodians and may authorize any Custodian to employ
subcustodians or agents and to deposit all or any part of
such assets in a system or systems for the central handling
of Securities, 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 Advisor, 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:
9
(a) Investments. To invest and reinvest cash
and other property; to buy, for cash or on margin,
and otherwise acquire and hold, Securities created
or issued by any Persons, including Securities
maturing after the possible termination of the
Trust; to make payment therefor in any lawful
manner in exchange for any of the Trust Property;
and to hold cash or other property uninvested
without in any event being bound or limited by any
present or future law or custom in regard to
investments by trustees;
(b) Disposition of Assets. 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;
(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 Fund to which such Securities or
property belong, or in the name of a Custodian,
subcustodian or other depository or a 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;
10
(e) Reorganization, 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 Fund; 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 or
all such obligations;
(i) Partnerships, etc. To enter into joint
ventures, general or limited partnerships and any
other combinations or associations;
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(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 Advisors, 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,
including any action taken or omitted that may be
determined to constitute negligence, whether or not
the Trust would have the power to indemnify such
Person against such liability;
(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 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;
(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,
12
whether or not any suit is commenced or any claim
shall have been made or asserted;
(m) Issuance and Repurchase of Shares. To
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 VI hereof, to apply
to any such repurchase, redemption, retirement,
cancellation or acquisition of Shares of any
Series, any of the Fund Assets belonging to the
Fund to which such Series relates, 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 Fund, 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 shall be kept;
(r) Valuation. Subject to the requirements
of the 1940 Act, to determine from time to time the
13
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
VIII 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. 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 Fund as 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 Fund, 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 Fund, or otherwise to carry out the
provisions of this Declaration.
SECTION 3.2. Borrowings; Financings: Issuance of
Securities. The Trustees have power 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 non-negotiable 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,
14
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, other than
liability based on their gross negligence or willful fault.
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 the shares of beneficial interest account
of the Fund to which such Shares relate and to allocate the
balance thereof to paid-in capital of that Fund, 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.
15
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.
ARTICLE IV
TRUSTEES AND OFFICERS
SECTION 4.1. Number, Designation, Election, Term,
etc.
(a) Initial Trustee. Upon his execution of
this Declaration of Trust or a counterpart hereof
or some other writing in which he accepts such
Trusteeship and agrees to the provisions hereof,
the individual whose signature is affixed hereto as
Initial Trustee shall become the Initial Trustee
hereof.
(b) Number. The Trustees serving as such,
whether named above or hereafter becoming Trustees,
may increase (to not more than twenty (20)) 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. No
decrease in the number of Trustees shall have the
effect of removing any Trustee from office prior to
the expiration of his term, but the number of
Trustees may be decreased in conjunction with the
removal of a Trustee pursuant to subsection (e) of
this Section 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 public offering of Shares of the Trust,
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), 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
16
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 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 trust or retire as a Trustee, by a
written instrument signed by him and delivered to
the other Trustees or to any officer of the Trust,
and such resignation or retirement shall take
effect upon such delivery or upon such later date
as is specified in such instrument.
(e) Removal. Any Trustee may be removed with
or without cause at any time: (i) by written
instrument, signed by at least two-thirds (2/3) of
the number of Trustees prior to such removal,
specifying the date upon which such removal shall
become effective; or (ii) by vote of Shareholders
holding not less than two-thirds (2/3) of the
Shares of each Series then outstanding, cast in
person or by proxy at any meeting called for the
purpose; or (iii) by a written declaration signed
by Shareholders holding not less than two-thirds
(2/3) of the Shares of each Series then outstanding
and filed with the Trust's Custodian.
(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 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 shall be no
Trustees in office, such vacancy or vacancies shall
17
be filled by vote of the Shareholders. Any such
appointment or election shall be effective upon
such individual's written acceptance of his
appointment as a Trustee and his 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. Any individual
appointed as a Trustee under subsection (f), and
any individual elected as a Trustee under
subsection (c), of this Section 4.1 who was not,
immediately prior to such election, acting as a
Trustee, shall accept such appointment or election
in writing and agree in such writing to be bound by
the provisions hereof, and whenever such individual
shall have executed such writing and any conditions
to such appointment or election shall have been
satisfied, such individual shall become a Trustee
and the Trust Property shall vest in the new
Trustee, together with the continuing Trustees,
without any further act or conveyance.
(h) Effect or Death, Resignation, etc. No
vacancy, whether resulting from the death,
resignation, retirement, removal or incapacity 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. A written instrument certifying the
existence of such vacancy signed by a Majority of
the Trustees shall be conclusive evidence of the
existence of such vacancy.
(i) Conveyance. In the event of the
resignation or removal of a Trustee or his
otherwise ceasing to be a Trustee, such former
Trustee or his legal representative shall, upon
request of the continuing Trustees, execute and
18
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 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.
(k) Filings. Whenever there shall be a
change in the composition of the Trustees, the
Trust shall cause to be filed in the office of the
Secretary of The Commonwealth of Massachusetts and
in each other place where the Trust is required to
file amendments to this Declaration a copy of
(i) the instrument by which (in the case of the
appointment of a new Trustee, or the election of an
individual who was not theretofore a Trustee) the
new Trustee accepted his appointment or election
and agreed to be bound by the terms of this
Declaration, or (in the case of a resignation) by
which the former Trustee resigned as such, together
in either case with a certificate of one of the
other Trustees as to the circumstances of such
election, appointment or resignation, or (ii) in
the case of the removal or death of a Trustee, a
certificate of one of the Trustees as to the
circumstances of such removal or resignation.
SECTION 4.2. Trustees' Meetings: Participation by
Telephone, etc. An annual meeting of Trustees shall be held
not later than the last day of the fourth month after the
end of each fiscal year of the Trust 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 two (2) Trustees,
or pursuant to a vole of the Trustees adopted at a duly
constituted meeting of the Trustees, and upon such notice as
shall be provided in the By-Laws. The Trustees may act with
or without a meeting, and a written consent to any matter,
signed by a Majority of the Trustees, shall be equivalent to
action duly taken at a meeting of the Trustees, duly called
19
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 Massachusetts.
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 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 an Executive Committee, and 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
20
resigning and (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) no Trustee or officer removed shall have any right
to any compensation as such Trustee or officer for any
period following his resignation or removal, or any right to
damages on account of his removal, whether his compensation
be by the month, by 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 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 Massachusetts 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 own individual account, any property,
and acquire, own, hold, carry on and dispose of, for his 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 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 same rights (or lesser
rights) to acquire, hold, own and dispose of property and
businesses, to carry on businesses, and to accept investment
21
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 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
22
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 Fund, 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 particular Funds made by them pursuant to
Section 6.2(b) 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
Advisor, Administrator, Distributor, Principal Underwriter,
auditor, counsel, Custodian, Transfer Agent, Dividend
Disbursing Agent, Accounting Agent, Shareholder Servicing
23
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 Fund, 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 Fund 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.
ARTICLE V
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
24
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 l940 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 or on behalf of the Trust
and/or any Fund, 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 Investment Advisor
shall undertake to furnish the Trust such
management, investment advisory or supervisory,
administrative, accounting, legal, 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 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. Notwithstanding any provisions of
this Declaration, the Trustees may authorize the
Investment Advisor (subject to such general or
specific instructions as the Trustees may from time
to time adopt) to effect purchases, sales, loans or
exchanges of portfolio 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 Advisor (and
25
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 at such meeting
the approval of continuance of any such investment
advisory or management agreement. If the
Shareholders of any Fund should fail to approve any
such investment advisory or management agreement,
the Investment Advisor may nonetheless serve as
Investment Advisor with respect to any other Fund
whose Shareholders shall have approved such
contract.
(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 Fund, will supervise all or any part
of the operations of the Trust and each Fund, 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 and each Fund (any such agent being herein
referred to as an "Administrator").
(c) Distribution. An agreement providing for
the sale of Shares of any one or more Series to net
the Trust not less than the net asset value per
Share (as described in Section 6.2(h) 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 a bank or
trust company having an aggregate capital, surplus
and undivided profits (as shown in its last
published report) of at least two million dollars
($2,000,000) as custodian of the Securities and
cash of the Trust and of each Fund and of the
accounting records in connection therewith (any
26
such agent being herein referred to as a
"Custodian").
(e) Transfer and Dividend Disbursing Agency.
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").
(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").
The same Person may be the Contracting Party for some or all
of the services, duties and responsibilities to, for and of
the Trust and/or the Trustees, and the contracts with
respect thereto may contain such terms interpretive of or in
addition to the delineation of the services, duties and
responsibilities provided for, including provisions that are
not inconsistent with the 1940 Act relating to the standard
of duty of and the rights to indemnification of the
Contracting Party and others, as the Trustees may determine.
Nothing herein shall preclude, prevent or limit the Trust or
a Contracting Party from entering into sub-contractual
arrangements relative to any of the matters referred to in
subsections (a) through (g) of this Section 5.2.
27
ARTICLE VI
FUNDS AND SHARES
SECTION 6.1. Description of Funds and Shares.
(a) Shares; Funds; Series of Shares. The
beneficial interest in the Trust shall be divided
into Shares having a nominal or par value of one
cent ($.01) per Share, and all of one class, 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 Funds into which the
assets of the Trust shall be divided, and to
authorize a separate Series of Shares for each such
Fund (each of which Series, including without
limitation each Series authorized in Section 6.2
hereof, shall represent interests only in the Fund
with respect to which such Series was authorized),
as they deem necessary or desirable. Except as
otherwise provided as to a particular Fund 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 Fund and the assets and
affairs thereof as they have under this Declaration
with respect to the Trust and the Trust Property in
general.
(b) Establishment, etc. of Funds;
Authorization of Shares. The establishment and
designation of any Fund in addition to the Funds
established and designated in Section 6.2 hereof
and the authorization of the Shares thereof shall
be effective upon the execution by 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 Fund
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 which may be
issued is unlimited, or may limit the number
issuable. At any time that there are no Shares
outstanding of any particular Fund previously
established and designated, including any Fund
established and designated in Section 6.2 hereof,
the Trustees may by an instrument executed by a
Majority of the Trustees terminate such Fund and
the establishment and designation thereof and the
authorization of its Shares (a "Certificate of
28
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, and shall be filed and become effective as
provided in Section 9.4 hereof.
(c) Character of Separate Funds and Shares
Thereof. Each Fund established hereunder shall be
a separate component of the assets of the Trust,
and the holders of Shares of the Series
representing the beneficial interest in the assets
of that Fund shall be considered Shareholders of
such Fund, 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 Fund as to such Fund,
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
Funds, and to fix and determine the relative rights
and preferences as between the shares of the
respective Funds 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 Funds shall have separate voting rights or
no voting rights.
(d) Consideration for Shares. The Trustees
may issue Shares of any Series 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 non-assessable (but may be
subject to mandatory contribution back to the Trust
as provided in Section 6.2(h) hereof). The
Trustees may classify or reclassify any unissued
Shares, or any Shares of any Series previously
issued and reacquired by the Trust, into Shares of
one or more other Funds that may be established and
designated from time to time.
29
SECTION 6.2. Establishment and Designation of the
Tax-Exempt Reserves Fund; General Provisions for All Funds.
Without limiting the authority of the Trustees set forth in
Section 6.1(a) hereof to establish and designate further
Funds, there is hereby established and designated the
Tax-Exempt Reserves Fund. The Shares of such Fund, and the
Shares of any further Funds that may from time to time be
established and designated by the Trustees shall (unless the
Trustees otherwise determine which respect to some further
Fund at the time of establishing and designating the same)
have the following relative rights and preferences:
(a) Assets Belonging to Funds. Any portion
of the Trust Property allocated to a particular
Fund, and all consideration received by the Trust
for the issue or sale of Shares of such Fund,
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 Fund and shall
irrevocably belong to that Fund for all purposes,
and shall be so recorded upon the books of account
of the Trust, and the Shareholders of such Fund
shall not have, and shall be conclusively deemed to
have waived, any claims to the assets of any Fund
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 Fund as
provided in the following sentence, are herein
referred to collectively as "Fund Assets" of such
Fund, and as assets "belonging to" that Fund. 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 Fund (collectively
"General Items"), the Trustees shall allocate such
General Items to and among any one or more of the
Funds 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 Fund
shall belong to and be part of the Fund Assets of
that Fund. Each such allocation by the Trustees
30
shall be conclusive and binding upon the
Shareholders of all Funds for all purposes.
(b) Liabilities of Funds. The assets
belonging to each particular Fund shall be charged
with the liabilities in respect of that Fund and
all expenses, costs, charges and reserves
attributable to that Fund, and any general
liabilities, expenses, costs, charges or reserves
of the Trust which are not readily identifiable as
pertaining to any particular Fund shall be
allocated and charged by the Trustees to and among
any one or more of the Funds 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 indebtedness,
expenses, costs, charges and reserves allocated and
so charged to a particular Fund are herein referred
to as "liabilities of" that Fund. Each allocation
of liabilities, expenses, costs, charges and
reserves by the Trustees shall be conclusive and
binding upon the Shareholders of all Funds for all
purposes. Any creditor of any Fund may look only
to the assets of that Fund to satisfy such
creditor's debt.
(c) Dividends. Dividends and distributions
on Shares of a particular Fund 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 Fund, from such of the
income, accrued or realized, and capital gains,
realized or unrealized, and out of the assets
belonging to that Fund, as the Trustees may
determine, after providing for actual and accrued
liabilities of that Fund. All dividends and
distributions on Shares of a particular Fund shall
be distributed pro rata to the Shareholders of that
Fund 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 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
31
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 or
Shares of that Fund or a combination thereof as
determined by the Trustees, or pursuant to any
program that the Trustees may have in effect at the
time for the election by each Shareholder of the
mode of the making of such dividend or distribution
to that Shareholder. Any such dividend or
distribution paid in Shares will be paid at the net
asset value thereof as determined in accordance
with subsection (h) of this Section 6.2.
(d) Liquidation. In the event of the
liquidation or dissolution of the Trust, the
Shareholders of each Fund of which Shares are
outstanding shall be entitled to receive, when and
as declared by the Trustees, the excess of the Fund
Assets over the liabilities of such Fund. The
assets so distributable to the Shareholders of any
particular Fund shall be distributed among such
Shareholders in proportion to the number of Shares
of that Fund held by them and recorded on the books
of the Trust. The liquidation of any particular
Fund 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 Fund, 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.
(e) Voting. The Shareholders shall have the
voting rights set forth in or determined under
Article VII hereof.
(f) Redemption by Shareholder. Each holder
of Shares of a particular Fund shall have the right
at such times as may be permitted by the Trust, but
no less frequently than once each week, to require
the Trust to redeem all or any part of his Shares
of that Fund at a redemption price equal to the net
asset value per Share of that Fund next determined
in accordance with subsection (h) of this Section
6.2 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. Payment of the
redemption price shall be in cash; provided,
32
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 Fund at the value of such Securities or assets
used in such determination of net asset value.
Notwithstanding the foregoing, the Trust may
postpone payment of the redemption price and may
suspend the right of the holders of Shares of any
Fund to require the Trust to redeem Shares of that
Fund during any period or at any time when and to
the extent permissible under the ▇▇▇▇ ▇▇▇.
(g) Redemption at the Option of the Trust.
Each Share of any Fund shall be subject to
redemption at the option of the Trust at the
redemption price which would be applicable if such
Share were then being redeemed by the Shareholder
pursuant to subsection (f) of this Section 6.2:
(i) at any time, if the Trustees determine in their
sole discretion that failure to so redeem may have
materially adverse consequences to the holders of
the Shares of the Trust or of any Fund, or
(ii) upon such other conditions with respect to
maintenance of Shareholder accounts of a minimum
amount as may from time to time be determined by
the Trustees and set forth in the then current
Prospectus of such Fund. Upon such redemption the
holders of the Shares so redeemed shall have no
further right with respect thereto other than to
receive payment of such redemption price.
(h) Net Asset Value. The net asset value per
Share of any Fund at any time shall be the quotient
obtained by dividing the value of the net assets of
such Fund at such time (being the current value of
the assets belonging to such Fund, less its then
existing liabilities) by the total number of Shares
of that Fund 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. The Trustees may determine to maintain the
net asset value per Share of any Fund 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 that Fund as dividends
payable in additional Shares of that Fund at the
designated constant dollar amount and for the
33
handling of any losses attributable to that Fund.
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 that Fund his pro rata portion of the
total number of Shares required to be cancelled in
order to permit the net asset value per Share of
that Fund 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 investment in any
Fund with respect to which the Trustees shall have
adopted any such procedure, to make the
contribution referred to in the preceding sentence
in the event of any such loss.
(i) Transfer. All Shares of each particular
Fund shall be transferable, but transfers of Shares
of a particular Fund will be recorded on the Share
transfer records of the Trust applicable to that
Fund only at such times as Shareholders shall have
the right to require the Trust to redeem Shares of
that Fund and at such other times as may be
permitted by the Trustees.
(j) Equality. All Shares of each particular
Fund shall represent an equal proportionate
interest in the assets belonging to that Fund
(subject to the liabilities of that Fund), and each
Share of any particular Fund shall be equal to each
other Share thereof; but the provisions of this
sentence shall not restrict any distinctions
permissible under subsection (c) of this Section
6.2 that may exist with respect to dividends and
distributions on Shares of the same Fund. The
Trustees may from time to time divide or combine
the Shares of any particular Fund into a greater or
lesser number of Shares of that Fund without
thereby changing the proportionate beneficial
interest in the assets belonging to that Fund or in
any way affecting the rights of the holders of
Shares of any other Fund.
(k) Rights of Fractional Shares. Any
fractional Share of any Series shall carry
proportionately all the rights and obligations of a
whole Share of that 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 Fund to
which they pertain.
34
(l) Conversion Rights. Subject to compliance
with the requirements of the 1940 Act, the Trustees
shall have the authority to provide that holders of
Shares of any Fund shall have the right so convert
said Shares into Shares of one or more other Funds
in accordance with such requirements and procedures
as the Trustees may establish.
SECTION 6.3. 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 each Fund held from time to time by each
such Shareholder.
The holders of Shares of each Fund shall upon
demand disclose to the Trustees in writing such information
with respect to their direct and indirect ownership of
Shares of such Fund 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 6.4. Investments in the Trust. The
Trustees may accept investments in any Fund 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 6.5. No Pre-emptive Rights. No
Shareholder, by virtue of holding Shares of any Fund, shall
have any pre-emptive or other right to subscribe to any
additional Shares of that Fund, or to any shares of any
other Fund, or any other Securities issued by the Trust.
35
SECTION 6.6. 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 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 Fund, 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 VII
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.l(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 as required by the 1940 Act,
(iii) with respect to any termination or reorganization of
the Trust or any Fund to the extent and as provided in
Sections 9.1 and 9.9 hereof, (iv) with respect to any
amendment of this Declaration of Trust to the extent and as
provided in Section 9.3 hereof, (v) to the same extent as
the stockholders of a Massachusetts business corporation as
to whether or not a court action, proceeding or claim should
or should not be brought or maintained derivatively or as a
class action on behalf of the Trust or any Fund, or the
Shareholders of any of them (provided, however, that a
Shareholder of a particular Fund shall not in any event be
entitled to maintain a derivative or class action on behalf
of any other Fund 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, 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 Fund
36
entitled to vote thereon; provided, that (i) when expressly
required by this Declaration or by the 1940 Act, actions of
Shareholders shall be taken by Single Class Voting of all
outstanding Shares of each Series 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 Funds, then only the Shareholders of the Funds
so affected shall be entitled to vote thereon.
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 any Series shall be
entitled to a number of votes equal to the number of Shares
of such Series standing in his name on the books of the
Trust. There shall be no cumulative voting in the election
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 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
37
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.
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 sixty (60)
days prior to the date of any meeting of Shareholders or
other action as the date and time of record for the
determination of Shareholders entitled to vote at such
meeting or 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
otter 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
38
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
Massachusetts business corporation under the Massachusetts
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.
ARTICLE VIII
LIMITATION OF LIABILITY; INDEMNIFICATION
SECTION 8.1. Trustees, Shareholders, etc. Not
Personally Liable; Notice. The Trustees and officers 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 or officers 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 Fund, 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 Fund, 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 Fund, that Fund)
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 Fund in tort, contract or otherwise in connection with
the assets or the affairs of the Trust or such Fund, and all
Persons dealing with the Trust or any Fund shall be deemed
to have agreed that resort shall be had solely to the Trust
39
Property of the Trust or the Fund Assets of such Fund, 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 this Declaration
of Trust is on file with the Secretary of The Commonwealth
of Massachusetts and shall recite to the effect that the
same was executed or made by or on behalf of the Trust or by
them as Trustees or Trustee or as officers or officer, and
not individually, and that the obligations of such
instrument are not binding upon any of them or the
Shareholders individually but are binding only upon the
assets and property of the Trust, or the particular Fund 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 Fund Assets of any Fund to the obligations of
any other Fund.
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 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 Advisor, 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
40
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) shall assume the defense against such charge
and satisfy any judgment thereon, 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 Fund 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.
SECTION 8.4. Indemnification of Trustees,
Officers, etc. Subject to the limitations set forth
hereinafter in this Section 8.4, the Trust shall indemnify
(from the assets of the Fund or Funds to which the conduct
in question relates) each of its Trustees and officers
(including Persons who serve at the Trust's request as
directors, officers or trustees of another organization in
which the Trust has any interest as a shareholder, creditor
or otherwise [hereinafter, 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 or (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 (either and both of the conduct
41
described in (i) and (ii) 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, or (b) an independent legal counsel in a written
opinion. Expenses, including accountants' and counsel fees
so incurred by any such Covered Person (but excluding
amounts paid in satisfaction of judgments, in compromise or
as fines or penalties), may be paid from time to time by the
Fund or Funds 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 Fund or
Funds if it is ultimately determined that indemnification of
such expenses is not authorized under this Article VIII 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
42
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 such
Covered Person's office.
SECTION 8.6. Indemnification Not Exclusive, etc.
The right of indemnification provided by this Article VIII
shall not be exclusive of or affect any other rights to
which any such Covered Person may be entitled. As used in
this Article VIII, 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 VIII shall
affect any rights to indemnification to which personnel of
the Trust, other than Trustees and officers, and other
Persons may be entitled by contract or otherwise under law,
nor the power of the Trust to purchase and maintain
liability insurance on behalf of any such Person.
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 IX
DURATION; REORGANIZATION; AMENDMENTS
SECTION 9.1. Duration and Termination of Trust.
Unless terminated as provided herein, the Trust shall
continue without limitation of time and, without limiting
the generality of the foregoing, no change, alteration or
modification with respect to any Fund or Series of Shares
shall operate to terminate the 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 Fund 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
43
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
6.2(d) hereof.
SECTION 9.2. 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 Funds, to another trust, partnership, association or
corporation organized under the laws of any state of the
United States, or may transfer such assets to another Fund
of the Trust, in exchange for cash, Shares or other
Securities (including, in the case of a transfer to another
Fund of the Trust, Shares of such other Fund), or to the
extent permitted by law then in effect may merge or
consolidate the Trust or any Fund 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 Fund 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 Funds of which the assets
have so been transferred) among the Shareholders of the Fund
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 9.2 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 Fund to such organizations or entities.
SECTION 9.3. 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
44
assessment upon the Shareholders (otherwise than as
permitted under Section 6.2(h)) 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 al 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
7.1 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 Funds, by the vote
of the holders of a majority of all the Shares entitled to
vote of each Fund so affected. Subject to the foregoing,
any such amendment shall be effective when the instrument
containing the terms thereof and a certificate (which may be
a part of such instrument) to the effect that such amendment
has been duly adopted, and setting forth the circumstances
thereof, shall have been executed and acknowledged by a
Trustee or officer of the Trust and filed as provided in
Section 9.4 hereof.
SECTION 9.4. 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), as well as the
certificates called for by Section 4.1(k) hereof as to
changes in the Trustees, shall be kept at the office of the
Trust where it may be inspected by any Shareholder, and one
copy of each such instrument shall be filed with the
Secretary of The Commonwealth of Massachusetts, as well as
with any other governmental office where such filing may
from time to time be required by the laws of Massachusetts.
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 filing with the
Secretary of The Commonwealth of Massachusetts, 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.
45
ARTICLE X
MISCELLANEOUS
SECTION 10.1. Governing Law. This Declaration of
Trust is executed and delivered in The Commonwealth of
Massachusetts and 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 Commonwealth.
SECTION 10.2. 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.
SECTION 10.3. Reliance by Third Parties. Any
certificate executed by an individual who, according to the
records in the office of the Secretary of The Commonwealth
of Massachusetts appears to be 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
as 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, or (f) the existence or non-existence of
any fact or facts which in any manner relate to the affairs
of the Trust, 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 10.4. 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 10.5. Use of the Name "Alliance".
Alliance Capital Management Corporation ("Alliance") has
consented to the use by the Trust of the identifying name
"Alliance", which is a property right of Alliance. The
Trust will only use the name "Alliance" as a component of
its name and for no other purpose, and will not purport to
grant to any third party the right to use the name
46
"Alliance" for any purpose. Alliance or any corporate
affiliate of Alliance may use or grant to others the right
to use the name "Alliance", as all or a portion of a
corporate or business name or for any commercial purpose,
including a grant of such right to any other investment
company. At the request of Alliance, the Trust will take
such action as may be required to provide its consent to the
use of such name by Alliance, or any corporate affiliate of
Alliance, or by any Person to whom Alliance or an affiliate
of Alliance shall have granted the right to the use of the
name "Alliance". Upon the termination of any investment
advisory or management agreement into which Alliance and the
Trust may enter, the Trust shall, upon request by Alliance,
cease to use the name "Alliance" as a component of its name,
and shall not use such name or initials as a part of its
name or for any other commercial purpose, and shall cause
its officers and Trustees to take any and all actions which
Alliance may request to effect the foregoing and to reconvey
to Alliance or such corporate affiliate any and all rights
to such name.
IN WITNESS WHEREOF, the undersigned has hereunto
set his hand and seal, for himself and his assigns, and has
thereby accepted the Trusteeship as the Initial Trustee of
Alliance Tax-Exempt Reserves hereby granted and agreed to
the provisions hereof, all as of the day and year first
above written.
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
The undersigned Settlor of Alliance Tax-Exempt
Reserves, hereby accepts, approves and authorizes the
foregoing Agreement and Declaration of Trust of Alliance
Tax-Exempt Reserves.
Dated: April 16, 1985
/S/ ▇▇▇▇ ▇▇▇▇
--------------------------
▇▇▇▇ ▇▇▇▇
47
ACKNOWLEDGMENTS
M A S S A C H U S E T T S
Suffolk, ss.: April 16, 1985
Then personally appeared the above named ▇▇▇▇ ▇▇▇▇
and acknowledged the foregoing instrument to be his free act
and deed.
Before me,
/s/
--------------------------
Notary Public
M A S S A C H U S E T T S
Suffolk, ss.: April 16, 1985
Then personally appeared the above named ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇ and acknowledged the foregoing instrument to be his
free act and deed.
Before me,
/s/
--------------------------
Notary Public
48
00250185.AH8