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EXHIBIT 1.1
COMMON SENSE TRUST
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AGREEMENT AND DECLARATION OF TRUST
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Dated: January 29, 1987
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COMMON SENSE TRUST
AGREEMENT AND DECLARATION OF TRUST
Index
Page
RECITALS . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
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. . . . . . . . . . . . . . . 7
ARTICLE III. POWERS OF THE TRUSTEES. . . . . . . . . . . . . . 8
Section 3.1 Powers in General . . . . . . . . . . . . . . . . 8
(a) Investments. . . . . . . . . . . . . . . . 9
(b) Disposition of Assets. . . . . . . . . . . 9
(c) Ownership Powers . . . . . . . . . . . . . 9
(d) Form of Holding. . . . . . . . . . . . . . 10
(e) Reorganization, etc. . . . . . . . . . . . 10
(f) Voting Trusts, etc.. . . . . . . . . . . . 10
(g) Contracts, etc.. . . . . . . . . . . . . . 10
(h) Guarantees, etc. . . . . . . . . . . . . . 10
(i) Partnerships, etc. . . . . . . . . . . . . 11
(j) Insurance. . . . . . . . . . . . . . . . . 11
(k) Pensions, etc. . . . . . . . . . . . . . . 11
(l) Power of Collection and Litigation . . . . 11
(m) Issuance and Repurchase of Shares. . . . . 12
(n) Offices. . . . . . . . . . . . . . . . . . 12
(o) Expenses . . . . . . . . . . . . . . . . . 12
(p) Agents, etc. . . . . . . . . . . . . . . . 12
(q) Accounts . . . . . . . . . . . . . . . . . 12
(r) Valuation. . . . . . . . . . . . . . . . . 12
(s) Indemnification. . . . . . . . . . . . . . 13
(t) General. . . . . . . . . . . . . . . . . . 13
Section 3.2 Borrowings; Financings; Issuance of
Securities. . . . . . . . . . . . . . . . . . . 13
Section 3.3 Deposits. . . . . . . . . . . . . . . . . . . . . 13
Section 3.4 Allocations . . . . . . . . . . . . . . . . . . . 14
Section 3.5 Further Powers; Limitations . . . . . . . . . . . 14
(i)
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ARTICLE IV. TRUSTEES AND OFFICERS . . . . . . . . . . . . . . 15
Section 4.1 Number, Designation, Election, Term, etc. . . . . 15
(a) Initial Trustees . . . . . . . . . . . . . 15
(b) Number . . . . . . . . . . . . . . . . . . 15
(c) Election and Term. . . . . . . . . . . . . 15
(d) Resignation and Retirement . . . . . . . . 16
(e) Removal. . . . . . . . . . . . . . . . . . 16
(f) Vacancies. . . . . . . . . . . . . . . . . 16
(g) Acceptance of Trusts . . . . . . . . . . . 16
(h) Effect of Death, Resignation, etc. . . . . 17
(i) Conveyance . . . . . . . . . . . . . . . . 17
(j) No Accounting. . . . . . . . . . . . . . . 17
(k) Filings. . . . . . . . . . . . . . . . . . 17
Section 4.2 Trustees' Meetings; Participation
by Telephone, etc.. . . . . . . . . . . . . . . 18
Section 4.3 Committees; Delegation. . . . . . . . . . . . . . 18
Section 4.4 Officers. . . . . . . . . . . . . . . . . . . . . 18
Section 4.5 Compensation of Trustees and Officers . . . . . . 19
Section 4.6 Ownership of Shares and Securities
of the Trust. . . . . . . . . . . . . . . . . . 19
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. . . . . . . . . . . . . . . . . 19
Section 4.8 Reliance on Experts . . . . . . . . . . . . . . . 20
Section 4.9 Surety Bonds. . . . . . . . . . . . . . . . . . . 20
Section 4.10 Apparent Authority of Trustees and Officers . . . 20
Section 4.11 Other Relationships Not Prohibited. . . . . . . . 21
Section 4.12 Payment of Trust Expenses . . . . . . . . . . . . 21
Section 4.13 Ownership of the Trust Property . . . . . . . . . 22
ARTICLE V. DELEGATION OF MANAGERIAL RESPONSIBILITIES. . . . . 22
Section 5.1 Appointment: Action by Less than
All Trustees. . . . . . . . . . . . . . . . . . 22
Section 5.2 Certain Contracts . . . . . . . . . . . . . . . . 23
(a) Advisory . . . . . . . . . . . . . . . . . 23
(b) Administration . . . . . . . . . . . . . . 24
(c) Distribution . . . . . . . . . . . . . . . 24
(d) Custodian. . . . . . . . . . . . . . . . . 24
(e) Transfer and Dividend Disbursing Agency. . 24
(f) Shareholder Servicing. . . . . . . . . . . 25
(g) Accounting . . . . . . . . . . . . . . . . 25
(ii)
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ARTICLE VI. PORTFOLIOS AND SHARES . . . . . . . . . . . . . . 25
Section 6.1 Description of Portfolios and Shares. . . . . . . 25
(a) Shares; Portfolios; Series of Shares . . . 25
(b) Establishment, etc. of Portfolios;
authorization of Shares . . . . . . . . 26
(c) Character of Separate Portfolios and
Shares Thereof. . . . . . . . . . . . . 26
(d) Consideration for Shares . . . . . . . . . 27
Section 6.2 Establishment and Designation of Certain
Portfolios; General Provisions for All
Portfolios. . . . . . . . . . . . . . . . . . . 27
(a) Assets Belonging to Portfolios . . . . . . 27
(b) Liabilities of Portfolios. . . . . . . . . 28
(c) Dividends. . . . . . . . . . . . . . . . . 28
(d) Liquidation. . . . . . . . . . . . . . . . 29
(e) Voting . . . . . . . . . . . . . . . . . . 29
(f) Redemption by Shareholder. . . . . . . . . 29
(g) Redemption at the Option of the Trust. . . 30
(h) Net Asset Value. . . . . . . . . . . . . . 30
(i) Transfer . . . . . . . . . . . . . . . . . 31
(j) Equality . . . . . . . . . . . . . . . . . 31
(k) Rights of Fractional Shares. . . . . . . . 31
(l) Conversion Rights31 .
Section 6.3 Ownership of Shares . . . . . . . . . . . . . . . 32
Section 6.4 Investments in the Trust. . . . . . . . . . . . . 32
Section 6.5 No Preemptive Rights. . . . . . . . . . . . . . . 32
Section 6.6 Status of Shares. . . . . . . . . . . . . . . . . 32
ARTICLE VII. SHAREHOLDERS' VOTING POWERS AND MEETINGS . . . . 33
Section 7.1 Voting Powers . . . . . . . . . . . . . . . . . . 33
Section 7.2 Number of Votes and Manner of Voting; Proxies . . 33
Section 7.3 Meetings. . . . . . . . . . . . . . . . . . . . . 34
Section 7.4 Record Dates. . . . . . . . . . . . . . . . . . . 34
Section 7.5 Quorum and Required Vote. . . . . . . . . . . . . 35
Section 7.6 Action by Written Consent . . . . . . . . . . . . 35
Section 7.7 Inspection of Records . . . . . . . . . . . . . . 35
Section 7.8 Additional Provisions . . . . . . . . . . . . . . 35
ARTICLE VIII LIMITATION OF LIABILITY; INDEMNIFICATION . . . . 36
Section 8.1 Trustees, Shareholders, etc. Not Personally
Liable; Notice. . . . . . . . . . . . . . . . . 36
Section 8.2 Trustees' Good Faith Action; Expert Advice;
No Bond or Surety . . . . . . . . . . . . . . . 37
Section 8.3 Indemnification of Shareholders . . . . . . . . . 37
Section 8.4 Indemnification of Trustees, Officers, etc. . . . 37
(iii)
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Section 8.5 Compromise Payment. . . . . . . . . . . . . . . . 39
Section 8.6 Indemnification Not Exclusive, etc. . . . . . . . 39
Section 8.7 Liability of Third Persons Dealing
with Trustees . . . . . . . . . . . . . . . . . 39
ARTICLE IX DURATION; REORGANIZATION; AMENDMENTS . . . . . . . 39
Section 9.1 Duration and Termination of Trust . . . . . . . . 39
Section 9.2 Reorganization. . . . . . . . . . . . . . . . . . 40
Section 9.3 Amendments; etc . . . . . . . . . . . . . . . . . 41
Section 9.4 Filing of Copies of Declaration and Amendments. . 41
ARTICLE X MISCELLANEOUS . . . . . . . . . . . . . . . . . . . 42
Section 10.1 Governing Law. . . . . . . . . . . . . . . . . . 42
Section 10.2 Counterparts . . . . . . . . . . . . . . . . . . 42
Section 10.3 Reliance by Third Parties. . . . . . . . . . . . 42
Section 10.4 References; Headings . . . . . . . . . . . . . . 42
Section 10.5 Use of the Name "Common Sense" . . . . . . . . . 42
Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . 43
(iv)
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AGREEMENT AND DECLARATION OF TRUST
OF
COMMON SENSE TRUST
This AGREEMENT AND DECLARATION OF TRUST, made at Boston, Massachusetts this
29th day of January, 1987, by and between the Settlor and the Trustee whose
signature is set forth below (the "Initial Trustee"),
WITNESSETH THAT:
WHEREAS, Xxxxx X. Xxxxx, an individual residing in Brookline, Massachusetts
(the "Settlor"), proposes to deliver to the Initial Trustee the sum of one
hundred dollars ($100.00) lawful money of the United States of America in
trust hereunder and to authorize the Initial Trustee and all other Persons
acting as Trustees hereunder to employ such funds, and any other funds coming
into their hands or the hands of their successor or successors as such
Trustees, to carry on the business of an investment company, and as such of
buying, selling, investing in or otherwise dealing in and with stocks, bonds,
debentures, warrants, options, futures contracts and other securities and
interests therein, or calls or puts with respect to any of the same, or such
other and further investment media and other property as the Trustees may
deem advisable, which are not prohibited by law or the terms of this
Declaration; and
WHEREAS, the Initial Trustee is willing to accept such sum, together with
any and all additions thereto and the income or increments thereof, upon the
terms, conditions and trusts hereinafter set forth; and
WHEREAS, the assets held by the Trustees may be divided into separate
portfolios, each with its own separate investment portfolio, investment
objectives, policies and purposes, and the beneficial interest in each such
portfolio shall be divided into transferable Shares of Beneficial Interest, a
separate Series of Shares for each portfolio, all in accordance with the
provisions hereinafter set forth; and
WHEREAS, it is desired that the trust established hereby (the "Trust") be
managed and operated as a trust with transferable shares under the laws of
Massachusetts, of the type commonly known as and referred to as a
Massachusetts business trust, in accordance with the provisions hereinafter
set forth,
NOW, THEREFORE, the Initial Trustee, for himself and his successors as
Trustees, hereby declares, and agrees with the
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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, i.e. Common Sense Growth Fund, Common Sense Growth and Income Fund
and Common Sense Government Fund, 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 "COMMON SENSE TRUST", and
so far as may be practicable the Trustees shall conduct the Trust's
activities, execute all documents and xxx 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, then
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.
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 benefi-
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ciaries 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. References in this Agreement and Declaration of Trust to
"hereof," "herein" and "hereunder" shall be deemed to refer to the
Declaration of Trust generally, and shall not be limited to the particular
text, Article or Section in which such words appear.
"Disabling Conduct" shall have the meaning designated in Section 8.4
hereof.
"Distributor" shall have the meaning designated in Section 5.2(c) hereof.
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"Dividend Disbursing Agent" shall have the meaning designated ln Section
5.2(e) hereof.
"General Items" shall have the meaning defined in Section 6.2(a) hereof.
"Initial Trustee" shall have the meaning defined in the preamble hereto.
"Investment 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 (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 Portfolio, "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 Portfolio) 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 binding
upon the Trust.
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"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.
"Portfolio" or "Portfolios" 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.
"Portfolio Assets" shall have the meaning defined in Section 6.2(a) hereof.
"Principal Underwriter" shall have the meaning designated
in Section 5.2(c) hereof.
"Prospectus," as used with respect to any Portfolio or Series of Shares,
shall mean the prospectus relating to such Portfolio 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, futures contracts or other instruments representing rights
to subscribe for, purchase, receive or otherwise acquire or to sell,
transfer, assign or otherwise 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.
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"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
Portfolios.
"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 Portfolio 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 Portfolio 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 his name on the
records of the Trust, irrespective of Series, and all outstanding Shares of
all Series vote as a single class.
"Statement of Additional Information" as used with respect to any Portfolio
or Series of Shares, shall mean the statement of additional information
relating to such Portfolio 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 Section 1.1 hereof and 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,
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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 Portfolio 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.
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, (c) rare coins and other numismatic items, (d) currencies of
all kinds, and (e) contracts to purchase or sell, and other interests of any
kind in, any of the foregoing, 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
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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 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 Portfolios to which they may
allocate such of the Trust Property, subject to such liabilities, as they
shall deem appropriate, each such Portfolio 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
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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:
(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 enter into futures contracts
of all kinds; 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
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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 Portfolio to which such Securities or property belong, or in the
name of a Custodian, subcustodian or other nominee or nominees, or
otherwise, upon such terms, in such manner or with such powers, as the
Trustees may determine, and with or without indicating any trust or the
interest of the Trustees therein;
(e) 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
Portfolio; to consent to any contract, lease, mortgage, purchase or sale
of property by such corporation or issuer, and to pay calls or
subscriptions with 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
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assume liability for payment thereof; and to mortgage and pledge the
Trust Property or any part thereof to secure any of or all such
obligations;
(i) Partnerships, etc. To enter into joint ventures, general or
limited partnerships and any other combinations or associations;
(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, xxx 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,
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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 Portfolio Assets belonging to the Portfolio 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 expenses and charges as
they may deem advisable (including without limitation appropriate fees
to themselves as Trustees), and to pay all 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 Portfolio, 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 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;
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(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 Portfolio 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 Portfolio, 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 Portfolio, 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-ne- gotiable 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; to reacquire any such Securities; and to
borrow securities to sell shorts; any such Securities of the Trust may, at
the discretion of the Trustees, be made convertible into Shares of any
Series, or may evidence the right to purchase, subscribe for or otherwise
acquire Shares of any Series, at such times and on such terms as and 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
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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 to 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 Portfolio to which such Shares relate and
to allocate the balance thereof to paid-in capital of that Portfolio, and to
reallocate such amounts from time to time; all as the Trustees may reasonably
deem proper.
SECTION 3.5 Further Powers; Limitations. The Trustees shall have power to
do all such other matters and things, and to execute all such instruments, as
they deem necessary, proper or desirable in order to carry out, promote or
advance the interests of the Trust, although such matters or things are not
herein specifically mentioned. Any determination as to what is in the
interests of the Trust made by the Trustees in good faith shall be
conclusive. In construing the provisions of this Declaration of Trust, the
presumption shall be in favor of a grant of power to the Trustees. The
Trustees shall not be required to obtain any court order to deal with the
Trust Property. The Trustees may limit their right to exercise any of their
powers through express restrictive provisions in the instruments evidencing
or providing the terms for any Securities of the Trust or in other
contractual instruments adopted on behalf of the Trust.
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ARTICLE 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 (or by an officer of the Trust pursuant to the vote of a
Majority of the Trustees). No decrease in the number of Trustees shall
have the effect of removing any Trustee from office prior to the
expiration of his 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 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).
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(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 0000 Xxx) 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
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.
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(h) Effect of 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 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
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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 preceding 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 vote of the Trustees adopted at a duly
constituted meeting of the Trustees, and upon such notice as shall be
provided in the By-Laws. 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
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 or Officer of the Trust, 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.
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SECTION 4.5 Compensation of Trustees and Officers. The Trustees shall fix
the compensation of all officers and Trustees. Without limiting the
generality of any of the provisions hereof, the Trustees shall be entitled to
receive reasonable compensation for their general services as such, and to
fix the amount of such compensation, and to pay themselves or any one or more
of themselves such compensation for special services, including legal,
accounting, or other professional services, as they in good faith may deem
reasonable. No Trustee or officer resigning 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
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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 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 action, 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.
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SECTION 4.11 Other Relationships Not Prohibited. The fact that:
(i) any of the Shareholders, Trustees or officers of the Trust is a
shareholder, director, officer, partner, trustee, employee, manager,
adviser, principal underwriter or distributor or agent of or for any
Contracting Party (as defined in Section 5.2 hereof), or of or for any
parent or affiliate of any Contracting Party, or that the Contracting
Party or any parent or affiliate thereof is a Shareholder or has an
interest in the Trust or any Portfolio, 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 Portfolios 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, employ-
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ees, Investment Advisor, Administrator, Distributor, Principal Underwriter,
auditor, counsel, Custodian, Transfer Agent, Dividend Disbursing Agent,
Accounting Agent, Shareholder Servicing Agent, and such other agents,
consultants, and independent contractors and such other expenses and charges
as the Trustees may deem necessary or proper to incur.
SECTION 4.13 Ownership of the Trust Property. Legal title to all the Trust
Property shall be vested in the Trustees as joint tenants, except that the
Trustees shall have power to cause legal title to any Trust Property to be
held by or in the name of one or more of the Trustees, or in the name of the
Trust, or of any particular Portfolio, 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 Portfolio 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 number
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of Trustees then in office without specification of the particular Trustees
required to be included therein, to act for and to bind the Trust, to the
same extent as the whole number of Trustees could do, either with respect to
one or more particular matters or classes of matters, or generally.
SECTION 5.2 Certain Contracts. Subject to compliance with the provisions of
the 1940 Act, but notwithstanding any limitations of present and future law
or custom in regard to delegation of powers by trustees generally, the
Trustees may, at any time and from time to time in their discretion and
without limiting the generality of their powers and authority otherwise set
forth herein, enter into one or more contracts with any one or more
corporations, trusts, associations, partnerships, limited partnerships, joint
ventures 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 Portfolio, 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 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
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agreement. If the Shareholders of any Portfolio 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 Portfolio 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
Portfolio, will supervise all or any part of the operations of the Trust
and each Portfolio, 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 Portfolio (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 Portfolio
and of the accounting records in connection therewith (any 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").
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(f) Shareholder Servicing. An agreement with an agent to provide
service with respect to the relationship of the Trust and its
Shareholders, records with respect to Shareholders and their Shares, and
similar matters (any such agent being herein referred to as a
"Shareholder Servicing Agent".)
(g) Accounting. An agreement with an agent to handle all or any part
of the accounting responsibilities, whether with respect to the Trust's
properties, Shareholders or otherwise (any such agent being herein
referred to as an "Accounting Agent").
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 contract 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.
ARTICLE VI
PORTFOLIOS AND SHARES
SECTION 6.1 Description of Portfolios and Shares.
(a) Shares; Portfolios; 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 Portfolios into which the assets of the Trust shall be
divided, and to authorize a separate Series of Shares for each such
Portfolios (each of which Series, including without limitation each
Series authorized in Section 6.2 hereof, shall represent interests only
in the Portfolio with respect to which such Series was authorized), as
they deem necessary or desirable. Except as otherwise provided as to a
particular Portfolio 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
Portfolio and the assets
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and affairs thereof as they have under this Declaration with respect to
the Trust and the Trust Property in general.
(b) Establishment, etc. of Portfolios; Authorization of Shares. The
establishment and designation of any Portfolio in addition to the
Portfolios 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 (or by an officer of the Trust
pursuant to the vote of a Majority of the Trustees) of an instrument
setting forth such establishment and designation and the relative rights
and preferences of the Shares of such Portfolio 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 Portfolio previously established
and designated in Section 6.2 hereof, the Trustees may by an instrument
executed by a Majority of the Trustees (or by an officer of the Trust
pursuant to the vote of a Majority of the Trustees) terminate such
Portfolio and the establishment and designation thereof and the
authorization of its Shares (a "Certificate of Termination"). Each
Certificate of Designation, Certificate of Termination and any
instrument amending a Certificate of Designation shall have the status
of an amendment to this Declaration of Trust, and shall be filed and
become effective as provided in Section 9.4 hereof.
(c) Character of Separate Portfolios and Shares Thereof. Each
Portfolio 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 Portfolio
shall be considered Shareholders of such Portfolio, 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
Portfolio as to such Portfolio, 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 Portfolios, and to fix and determine the relative rights and
preferences as between the shares of the respective Portfolios 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
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the Shareholders of the several Portfolios 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 nonassessable (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 un- issued Shares,
or any Shares of any Series previously issued and reacquired by the
Trust, into Shares of one or more other Portfolios that may be
established and designated from time to time.
SECTION 6.2 Establishment and Designation of Certain Portfolios; General
Provisions for All Portfolios. Without limiting the authority of the Trustees
set forth in Section 6.1(a) hereof to establish and designate further
portfolios, there are hereby established and designated the Common Sense
Growth Fund, the Common Sense Growth and Income Fund and the Common Sense
Government Fund as three separate portfolios. The Shares of each such
Portfolio, and the Shares of any further Portfolio that may from time to time
be established and designated by the Trustees shall (unless the Trustees
otherwise determine with respect to some further Portfolio at the time of
establishing and designating the same) have the following relative rights and
preferences:
(a) Assets Belonging to Portfolios. Any portion of the Trust Property
allocated to a particular Portfolio, and all consideration received by
the Trust for the issue or sale of Shares of such Portfolio, 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 Portfolio and shall irrevocably belong to that
Portfolio for all purposes, and shall be so recorded upon the books of
account of the Trust, and the Shareholders of such Portfolio shall not
have, and shall be conclusively deemed to have waived, any claims to the
assets of any Portfolio of which they are not Shareholders. Such
consideration, assets, interest, dividends, income, earnings, profits,
gains and pro-
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ceeds, together with any General Items allocated to that Portfolio as
provided in the following sentence, are herein referred to collectively
as "Portfolio Assets" of such Portfolio, and as assets "belonging to"
that Portfolio. 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 Portfolio
(collectively "General Items"), the Trustees shall allocate such General
Items to and among any one or more of the Portfolios 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 Portfolio shall belong to and be part of
the Portfolio Assets of that Portfolio. Each such allocation by the
Trustees shall be conclusive and binding upon the Shareholders of all
Portfolios for all purposes.
(b) Liabilities of Portfolios. The assets belonging to each particular
Portfolio shall be charged with the liabilities in respect of that
Portfolio and all expenses, costs, charges and reserves attributable to
that Portfolio, and any general liabilities, expenses, costs, charges or
reserves of the Trust which are not readily identifiable as pertaining
to any particular Portfolio shall be allocated and charged by the
Trustees to and among any one or more of the Portfolios 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 Portfolio are herein referred to as "liabilities
of" that Portfolio. Each allocation of liabilities, expenses, costs,
charges and reserves by the Trustees shall be conclusive and binding
upon the Shareholders of all Portfolios for all purposes. Any creditor
of any Portfolio may look only to the assets of that Portfolio to
satisfy such creditor's debt.
(c) Dividends. Dividends and distributions on Shares of a particular
Portfolio 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 Portfolio, from such of the
income, accrued or realized, and capital gains, realized or unrealized,
and out of the assets belonging to that Portfolio, as the Trustees may
determine, after providing for actual and accrued liabilities of that
Portfolio. All dividends and distributions on Shares of a particular
Portfolio shall be distributed pro rata to the Shareholders of that
Portfolio in proportion to the number of such Shares held by such
holders at
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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 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 Portfolio 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 Portfolio of which Shares are
outstanding shall be entitled to receive, when and as declared by the
Trustees, the excess of the Portfolio assets over the liabilities of
such Portfolio. The assets so distributable to the Shareholders of any
particular Portfolio shall be distributed among such Shareholders in
proportion to the number of Shares of that Portfolio held by them and
recorded on the books of the Trust. The liquidation of any particular
Portfolio 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 Portfolio, 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
Portfolio 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 Portfolio at a
redemption price equal to the net asset value per Share of that
Portfolio next determined in accordance with subsection (h) of this
Section 6.2 after the Shares are properly tendered for redemption:
provided, that the Trustees
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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, 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 Portfolio 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 Portfolio to require the Trust to redeem Shares of that Portfolio
during any period or at any time when and to the extent permissible
under the 0000 Xxx.
(g) Redemption at the Option of the Trust. Each Share of any Portfolio
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 Portfolio, or (ii) upon
such other conditions with respect to maintenance of Shareholder
accounts of a minimum amount as may from time to time by determined by
the Trustees and set forth in the then current Prospectus of such
Portfolio. 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 Portfolio at
any time shall be the quotient obtained by dividing the value of the net
assets of such Portfolio at such time (being the current value of the
assets belonging to such Portfolio, less its then existing liabilities)
by the total number of Shares of that Portfolio 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 Portfolio 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 Portfolio as dividends payable in additional Shares
of that Portfolio at the designated constant dollar amount and for the
handling of any losses attributable to that Portfolio. Such procedures
may provide that in the event of any loss each Shareholder shall be
deemed to have
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contributed to the shares of beneficial interest account of that
Portfolio his pro rata portion of the total number of Shares required to
be canceled in order to permit the net asset value per Share of that
Portfolio 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 Portfolio
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 Portfolio shall be
transferable, but transfers of Shares of a particular Portfolio will be
recorded on the Share transfer records of the Trust applicable to that
Portfolio only at such times as Shareholders shall have the right to
require the Trust to redeem Shares of that Portfolio and at such other
times as may be permitted by the Trustees.
(j) Equality. All Shares of each particular Portfolio shall represent
an equal proportionate interest in the assets belonging to that
Portfolio (subject to the liabilities of that Portfolio), and each Share
of any particular Portfolio 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 Portfolio.
The Trustees may from time to time divide or combine the Shares of any
particular Portfolio into a greater or lesser number of Shares of that
Portfolio without thereby changing the proportionate beneficial interest
in the assets belonging to that Portfolio or in any way affecting the
rights of the holders of Shares of any other Portfolio.
(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 Portfolio to which they pertain.
(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 Portfolio shall have the right to convert said
Shares into Shares of one or more other Portfolios in accordance with
such requirements and procedures as the Trustees may establish.
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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 Portfolio
held from time to time by each such Shareholder.
The holders of Shares of each Portfolio shall upon demand disclose to the
Trustees in writing such information with respect to their direct and
indirect ownership of Shares of such Portfolio 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 Portfolio 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 Portfolio, shall have any pre-emptive or other right to
subscribe to any additional Shares of that Portfolio, or to any shares of any
other Portfolio, or any other Securities issued by the Trust.
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
Portfolio, nor entitle the representative of any deceased Share-
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holder 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 Shareholder shall have power to vote only
(i) for the election or removal of Trustees as provided in Sections 4.1(c)
and (e) hereof, (ii) with respect to the approval or termination in
accordance with the 1940 Act of any contract with a Contracting Party as
provided in Section 5.2 hereof as to which Shareholder approval is as
required by the 1940 Act, (iii) with respect to any termination or
reorganization of the Trust or any Portfolio to the extent and as provided in
Sections 9.1 and 9.2 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 Portfolio, or the Shareholders of any of them
(provided, however, that a Shareholder of a particular Portfolio shall not in
any event be entitled to maintain a derivative or class action on behalf of
any other portfolio 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 Portfolio 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 interest of Shareholders of one or
more but not all Portfolios, then only the Shareholders of the Portfolios 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
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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 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
Shareholder 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
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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. Twenty per centum (20%) of the Shares
of each Series 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 dates set for the original meetings
without the necessity of further notice. A majority Shareholder Vote at a
meeting of which a quorum is present shall decide any question, except when a
different vote is required or permitted by any provision of the 1940 Act or
other applicable law or by this Declaration of Trust or the By-Laws, or when
the Trustees shall in their discretion require a larger vote or the vote of a
majority or larger fraction of the Shares of one or more particular Series.
SECTION 7.6 Action by Written Consent. Subject to the provisions of the
1940 Act and other applicable law, any action taken by Shareholders may be
taken without a meeting if a majority of Shareholders entitled to vote on the
matter (or such larger proportion thereof or of the Shares of any particular
Series as shall be required by the 1940 Act or by any express provision of
this Declaration of Trust or the By-Laws or as shall be permitted by the
Trustees) consent to the action in writing and if the writings in which such
consent is given are filed with the records of the meetings of Shareholders,
to the same extent and for the same period as proxies given in connection
with a Shareholders' meeting. Such consent shall be treated for all purposes
as a vote taken at a meeting of Shareholders.
SECTION 7.7 Inspection of Records. The records of the Trust shall be open
to inspection by Shareholders to the same extent as is permitted stockholders
of a 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.
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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 Portfolio, 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 Portfolio, 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 Portfolio, that Portfolio) 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 Portfolio in tort, contract or otherwise in connection with
the assets or the affairs of the Trust or such portfolio, and all Persons
dealing with the Trust or any Portfolio shall be deemed to have agreed that
resort shall be had solely to the Trust Property of the Trust or the
Portfolio Assets of such Portfolio, 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 Portfolio 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
Portfolio Assets of any Portfolio to the obligations of any other Portfolio.
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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 Adviser, Administrator,
Dealer Distributor or Principal Underwriter, Custodian or Transfer Agent,
Dividend Disbursing Agent, Shareholder Servicing Agent or Accounting Agent of
the Trust, nor shall any Trustee be responsible for the act or omission of
any other Trustee; (ii) the Trustees may take advice of counsel or other
experts with respect to the meaning and operation of this Declaration of
Trust and their duties as Trustees, and shall be under no liability for any
act or omission in accordance with such advice or for failing to follow such
advice; and (iii) in discharging their duties, the Trustees, when acting in
good faith, shall be entitled to rely upon the books of account of the Trust
and upon written reports made to the Trustees by any officer appointed by
them, any independent public accountant, and (with respect to the subject
matter of the contract involved) any officer, partner or responsible employee
of a Contracting Party appointed by the Trustees pursuant to Section 5.2
hereof. The Trustees as such shall not be required to give any bond or surety
or any other security for the performance of their duties.
SECTION 8.3 Indemnification of Shareholders. If any Shareholder (or former
Shareholder) of the Trust shall be charged or held to be personally liable
for any obligation or liability of the Trust solely by reason of being or
having been a Shareholder and not because of such Shareholder's acts or
omissions or for some other reason, the Trust (upon proper and timely request
by the Shareholder) 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 Portfolio
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 Portfolio or Portfolios to which the
conduct in question re-
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lates) each of its Trustees and officers (including Persons who serve at the
Trust's request as directors, officers or trustees or 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 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 ac- countants' 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 Portfolio or Portfolios 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 Portfolio or Portfolios 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,
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shall have determined, based on a review of readily available facts (as
opposed to a full trial-type inquiry), that there is reason to believe that
the Covered Person ultimately will be found entitled to indemnification.
SECTION 8.5 Compromise Payment. As to any matter disposed of by a
compromise payment by any such Covered Person referred to in Section 8.4
hereof, pursuant to a consent decree or otherwise, no such indemnification
either for said payment or for any other expenses shall be provided unless
such indemnification shall be approved (i) by a majority of a quorum of the
disinterested Trustees or (ii) by an independent legal counsel in a written
opinion. Approval by the Trustees pursuant to clause (i) or by independent
legal counsel pursuant to clause (ii) shall not prevent the recovery from any
Covered Person of any amount paid to such Covered Person in accordance with
either of such clauses as indemnification if such Covered Person is
subsequently adjudicated by a court of competent jurisdiction not to have
acted in good faith in the reasonable belief that such Covered Person's
action was in or not opposed to the best interests of the Trust or to have
been liable to the Trust or its Shareholders by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of 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
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limitation of time and, without limiting the generality of the foregoing, no
change, alteration or modification with respect to any Portfolio 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 Portfolio of the Trust, or by an instrument or instruments in
writing without a meeting, consented to by the holders of not less than a
majority of such Shares, or by such greater or different vote of Shareholders
of any Series as may be established by the Certificate of Designation by
which such Series was authorized. Upon termination, after paying or otherwise
providing for all charges, taxes, expenses and liabilities, whether due or
accrued or anticipated as may be determined by the Trustees, the Trust shall
in accordance with such procedures as the Trustees consider appropriate
reduce the remaining assets to distributable form in cash, Securities or
other property, or any combination thereof, and distribute the proceeds to
the Shareholders, in conformity with the provisions of Section 6.2(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 Portfolios, 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 Portfolio of the Trust, in exchange for
cash, Shares or other Securities (including, in the case of a transfer to
another Portfolio of the Trust, Shares of such other Portfolio), or to the
extent permitted by law then in effect may merge or consolidate the Trust or
any Portfolio 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 Portfolio 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 Portfolios of which the assets have so been
transferred) among the Shareholders of the Portfolio 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 Share-
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holders 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 Portfolio 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 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 at any time, so long as such amendment
does not adversely affect the rights of any Shareholder with respect to which
such amendment is or purports to be applicable and so long as such amendment
is not in contravention of applicable law, including the 1940 Act, by an
instrument in writing signed by a Majority of the Trustees (or by an officer
of the Trust pursuant to the vote of a Majority of the Trustees). Any
amendment to this Declaration of Trust that adversely affects the rights of
all Shareholders may be adopted at any time by an instrument in writing
signed by a Majority of the Trustees (or by an officer of the Trust pursuant
to a vote of a Majority of the Trustees) when authorized to do so by the vote
in accordance with Section 7.1 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 Portfolios, by the vote of the holders of a majority of all
the Shares entitled to vote of each Portfolio 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
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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.
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 nonexistence
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 "Common Sense". The Trust uses the words
"Common Sense," either alone or as part of the
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name "Common Sense Trust," with the consent for non-exclusive use of Common
Sense Investment Advisers ("CSIA"), subject to a non-exclusive agreement
("License Agreement") with X. X. Xxxxxxxx & Associates, Inc. ("Associates"),
the owner of the name, permitting the Adviser to use the words "Common Sense"
for certain purposes. CSIA or Associates may require the Trust, or any Series
or Portfolio of the Trust, to cease using the words "Common Sense" upon the
occurrence of certain events, including if there is not an effective advisory
agreement and sub-license agreement between the Trust and CSIA, CSIA is
determined to be bankrupt, or First American National Asset Management, Inc.
("FANAM") or a "permitted transferee" of FANAM ceases to be a Partner in
CSIA. In any such event, the Trust will discontinue its use of the words
"Common Sense" within 180 days. The Trust acknowledges that CSIA has reserved
the right to use "Common Sense" and to license the use of "Common Sense" to
other investment companies which it may sponsor or manage, and that
Associates has reserved all rights to "Common Sense" other than granted in
the License Agreement.
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 Common Sense Trust hereby granted and agreed to the
provisions hereof, all as of the day and year first above written.
s/Xxxxxx X. Xxxxxxx
------------------------------
Xxxxxx X. Xxxxxxx
The undersigned Settlor of Common Sense Trust, hereby accepts, approves and
authorizes the foregoing Agreement and Declaration of Trust of Common Sense
Trust.
Dated: January 29, 1987
s/Xxxxx X. Xxxxx
------------------------------
Xxxxx X. Xxxxx
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ACKNOWLEDGMENTS
M A S S A C H U S E T T S
Suffolk, ss.: January 29, 1987
Then personally appeared the above named Xxxxx X. Xxxxx and acknowledged
the foregoing instrument to be his free act and deed.
Before me,
s/Xxxxx X. Xxxx
------------------------------
Notary Public
My Commisson Expires
January 15, 1993
M A S S A C H U S E T T S
Suffolk, ss.: January 29, 1987
Then personally appeared the above named Xxxxxx X. Xxxxxxx and acknowledged
the foregoing instrument to be his free act and deed.
Before me,
s/Xxxxx X. Xxxx
------------------------------
Notary Public
My Commisson Expires
January 15, 1993
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