Exhibit 99.1(A)
Sierra Prime Income Fund
AMENDED AGREEMENT AND DECLARATION OF TRUST
January 18, 1996
AMENDED AGREEMENT AND DECLARATION OF TRUST
PAGE
ARTICLE I. NAME AND DEFINITIONS 2
Section 1.1 Name 2
Section 1.2 Definitions 2
a) "Trust" 2
b) "Trustees" 2
c) "Shares" 2
d) "Shareholder" 2
e) "1940 Act" 2
f) "Affiliated Person,"
"Assignment," "Commission,"
"Interested Person,"
"Principal Underwriter," and
"Majority Shareholder Vote" 2
g) "Declaration of Trust" 2
h) "By-Laws" 2
ARTICLE II. PURPOSE OF THE TRUST 2
Section 2.1 Purpose of the Trust 2
ARTICLE III. THE TRUSTEES 3
Section 3.1 Election, Resignation, Vacancies, etc. 3
a) Election 3
b) Effect of Death, Resignation, etc. 3
c) No Accounting 3
d) Vacancies 3
Section 3.2 Powers of Trustees 4
a) Investments 4
b) Disposition of Assets 4
c) Act as Distributor, Underwriter,
Broker, Dealer 5
d) Ownership Powers 5
e) Subscription 5
f) Form of Holding 5
g) Allocation of Assets and
Liabilities 5
h) Reorganization, etc. 5
i) Voting Trusts, etc. 5
j) Compromise 5
k) Partnerships, etc. 6
l) Borrowing 6
m) Guarantees, etc. 6
n) Insurance 6
o) Pensions 6
p) Any Other Lawful Activity 6
Section 3.3 Advisory, Management and Distribution 7
Section 3.4 Payment of Expenses by the Trust 8
Section 3.5 Ownership of Assets of the Trust 9
ARTICLE IV. SHARES 9
Section 4.1 Beneficial Interest 9
Section 4.2 Ownership of Shares 9
Section 4.3 Investment in the Trust 9
Section 4.4 No Preemption Rights 10
Section 4.5 Status of Shares and Limitation
of Personal Liability 10
ARTICLE V. SHAREHOLDERS' VOTING POWERS AND MEETINGS 10
Section 5.1 Shareholders' Voting Powers and Meetings 10
ARTICLE VI. DISTRIBUTIONS AND REPURCHASES 10
Section 6.1 Distributions 10
Section 6.2 Repurchases 11
Section 6.3 Dividends, Distributions and Repurchases 11
ARTICLE VII. COMPENSATION AND LIMITATION OF LIABILITY
OF TRUSTEES 11
Section 7.1 Compensation 11
Section 7.2 Limitation of Liability 11
ARTICLE VIII. INDEMNIFICATION 12
Section 8.1 Trustees, Officers, etc. 12
Section 8.2 Compromise Payment 12
Section 8.3 Indemnification Not Exclusive 13
Section 8.4 Shareholders 13
ARTICLE IX. MISCELLANEOUS 14
Section 9.1 Trustees, Shareholders, etc. Not
Personally Liable; Notice 14
Section 9.2 Trustee's Good Faith Action,
Expert Advice, No Bond or Surety 14
Section 9.3 Liability of Third Persons Dealing
with Trustees 15
Section 9.4 Merger of Classes of Shares of the
Trust 15
Section 9.5 Duration and Termination of Trust 16
Section 9.6 Merger, Consolidation and Sale of Assets 16
Section 9.7 Conversion to Open-End Management
Investment Company 17
Section 9.8 Certain Transactions 17
Section 9.9 Amendments 19
Section 9.10 Resident Agent 19
Section 9.11 Filing of Copies; References; Headings 19
Section 9.12 Applicable Law 20
Section 9.13 Provisions in Conflict with Laws
or Regulations 20
Section 9.14 Use of Name 21
Sierra Prime Income Fund
CROSS-REFERENCE SHEET
Pursuant to CMR 116.00:
116.03 (a) Name of organization or trust:
Sierra Prime Income Fund
(b) Date of organization:
October 4, 1995
(c) Names and address of the trustees:
F. Xxxxx Xxxxxx
0000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
(d) Original signatures of all trustees:
See page 21.
(e) Principal place of business:
0000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
(f) Statement that beneficial interest is
divided into transferable certificates of
participation or shares;
See Section 4.1, page 9.
(g) Ability to merge:
See Section 9.6, page 16.
(h) The name and address of the resident agent
in Massachusetts:
The Xxxxxxxx-Xxxx Corporation System, Inc.
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
SIERRA PRIME INCOME FUND
AMENDED AGREEMENT AND DECLARATION OF TRUST
AMENDED AGREEMENT AND DECLARATION OF TRUST made at Boston,
Massachusetts this 18th day of January, 1996, by the Trustees hereunder, and by
the holders of shares of beneficial interest to be issued hereunder as
hereinafter provided.
WITNESSETH
WHEREAS this Trust has been formed to carry on the business of
an investment company; and
WHEREAS this Trust is authorized to issue its shares of
beneficial interest in accordance with the provisions hereinafter set forth; and
WHEREAS the Trustees have agreed to manage all property coming
into their hands as trustees of a Massachusetts business trust in accordance
with the provisions hereinafter set forth.
NOW, THEREFORE, the Trustees hereby declare that they will
hold all cash, securities and other assets which they may from time to time
acquire in any manner as Trustees hereunder IN TRUST to manage and dispose of
the same upon the following terms and conditions for the benefit of the holders
from time to time of shares of beneficial interest in this Trust.
ARTICLE I
NAME AND DEFINITIONS
Section 1.1 Name. This Trust shall be known as the "Sierra
Prime Income Fund" and the Trustees shall conduct the business of the Trust
under that name or any other name or names as they may from time to time
determine.
Section 1.2 Definitions. Whenever used herein, unless
otherwise required by the context or specifically provided:
(a) The "Trust" refers to the Massachusetts business trust
established by an Agreement and Declaration of Trust dated October 4, 1995, as
amended from time to time;
(b) "Trustees" refers to the Trustees of the Trust hereunder
named herein or elected in accordance with Article III;
(c) "Shares" refers to the transferable units of interest into
which the beneficial interest in the Trust shall be divided from time to time;
(d) "Shareholder" means a record owner of Shares;
(e) The "1940 Act" refers to the Investment Company Act of
1940 and the Rules and Regulations thereunder, all as amended from time to time;
(f) The terms "Affiliated Person," "Assignment," "Commission,"
"Interested Person," "Principal Underwriter" and "Majority Shareholder Vote"
(the 67% or 50% requirement of the third sentence of Section 2(a)(42) of the
1940 Act, whichever may be applicable) shall have the meanings given them in the
1940 Act;
(g) "Declaration of Trust" shall mean this Amended Agreement
and Declaration of Trust as amended or restated from time to time; and
(h) "By-Laws" shall mean the By-Laws of the Trust as amended
from time to time.
ARTICLE II
PURPOSE OF THE TRUST
Section 2.1 Purpose of the Trust. The purpose of the Trust is
to operate as an investment company and to provide investors a managed
investment primarily in securities and to carry on such other business as the
Trustees may from time to time determine pursuant to their authority under this
Amended Agreement and Declaration of Trust.
ARTICLE III
THE TRUSTEES
Section 3.1 Election, Resignation, Vacancies, etc..
(a) Election. There shall initially be one Trustee who shall
be F. Xxxxx Xxxxxx. The number of Trustees shall be as provided in the By-laws
or as fixed from time to time by the Trustees. The Shareholders may elect
Trustees at any meeting of Shareholders called by the Trustees for that purpose.
Each Trustee shall serve during the continued lifetime of the Trust until he or
she dies, resigns or is removed, or, if sooner, until the next meeting of
Shareholders called for the purpose of electing Trustees and the election and
qualification of his or her successor. Any Trustee may resign at any time by
written instrument signed by him or her and delivered to any officer of the
Trust, to each other Trustee or to a meeting of the Trustees. Such resignation
shall be effective upon receipt unless specified to be effective at some other
time. Except to the extent expressly provided in a written agreement with the
Trust, no Trustee resigning and no Trustee removed shall have any right to any
compensation for any period following his resignation or removal, or any right
to damages on account of such removal.
(b) Effect of Death, Resignation, etc. of a Trustee. The
death, declination, resignation, retirement, removal or incapacity of the
Trustees, or any one of them, shall not operate to annul the Trust or to revoke
any existing agency created pursuant to the terms of this Amended Declaration of
Trust.
(c) No Accounting. Except to the extent required by the 1940
Act or under circumstances which would justify his or her removal for cause, no
person ceasing to be a Trustee as a result of his or her death, resignation,
retirement, removal or incapacity (nor the estate of any such person) shall be
required to make an accounting to the Shareholders or remaining Trustees upon
such cessation.
(d) Vacancies. Any vacancy or anticipated vacancy resulting
from any reason, including without limitation the death, resignation,
retirement, removal or incapacity of any of the Trustees, or resulting from an
increase in the number of Trustees by the other Trustees may (but so long as
there are at least two remaining Trustees, need not unless required by the 0000
Xxx) be filled by a majority of the remaining Trustees, subject to the
provisions of Section 16(a) of the 1940 Act, through the appointment in writing
of such other person as such remaining Trustees in their discretion shall
determine and such appointment shall be effective upon the written acceptance of
the person named therein to serve as a Trustee and agreement by such person to
be bound by the provisions of this Amended Agreement and Declaration of Trust,
except that any such appointment in anticipation of a vacancy to occur by reason
of retirement, resignation, or increase in 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 number of Trustees. As soon as any
Trustee so appointed shall have accepted such appointment and shall have agreed
in writing to be bound by this Amended Agreement and Declaration of Trust and
the appointment is effective, the Trust estate shall vest in the new Trustee,
together with the continuing Trustees, without any further act or conveyance.
Section 3.2. Powers. Subject to the provisions of this Amended
Agreement and Declaration of Trust, the business of the Trust shall be managed
by the Trustees, and they shall have all powers necessary or convenient to carry
out that responsibility. Without limiting the foregoing, the Trustees may adopt
By-laws not inconsistent with this Declaration of Trust providing for the
conduct of the business 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
enlarge or reduce their number, may fill vacancies in their number, including
vacancies caused by enlargement of their number, and may remove Trustees with or
without cause; they may elect and remove, with or without cause, such officers
and appoint and terminate such agents as they consider appropriate; they may
appoint from their own number, and terminate, any one or more committees
consisting of two or more Trustees, including an executive committee which may,
when the Trustees are not in session, exercise some or all of the power and
authority of the Trustees as the Trustees may determine; they may employ one or
more custodians of the assets of the Trust and may authorize such custodians to
employ subcustodians and to deposit all or any part of such assets in a system
or systems for the central handling of securities, retain a transfer agent or a
Shareholder servicing agent, or both, provide for the distribution of Shares by
the Trust, through one or more principal underwriters or otherwise, set record
dates for the determination of Shareholders with respect to various matters, and
in general delegate such authority as they consider desirable to any officer of
the Trust, to any committee of the Trustees and to any agent or employee of the
Trust or to any such custodian or underwriter.
Without limiting the foregoing, the Trustees shall have power and authority:
(a) To invest and reinvest cash, and to hold cash uninvested;
(b) To sell, exchange, lend, pledge, mortgage, hypothecate,
write options on and lease any or all of the assets of the Trust;
(c) To act as a distributor of shares and as underwriter of,
or broker or dealer in, securities or other property;
(d) To vote or give assent, or exercise any rights of
ownership, with respect to stock or other securities or property; and to execute
and deliver proxies or powers of attorney to such person or persons as the
Trustees shall deem proper, granting to such person or persons such power and
discretion with relation to securities or property as the Trustees shall deem
proper;
(e) To exercise powers and rights of subscription or otherwise
which in any manner arise out of ownership of securities;
(f) To hold any security or property in a form not indicating
any trust, whether in bearer, unregistered or other negotiable form, or in the
name of the Trustees or of the Trust or in the name of a custodian, subcustodian
or other depository or a nominee or nominees or otherwise;
(g) To allocate assets, liabilities and expenses of the Trust
to a particular class of Shares or to apportion the same among two or more
classes of Shares, provided that any liabilities or expenses incurred by a
particular class of Shares shall be payable solely out of the assets of that
class.
(h) 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; to consent to any contract,
lease, mortgage, purchase or sale of property by such corporation or issuer, and
to pay calls or subscriptions with respect to any security held in the Trust;
(i) To join with other security holders in acting through a
committee depositary, voting trustee or otherwise, and in that connection to
deposit any security with, or transfer any security to, any such committee,
depositary or trustee, and to delegate to them such power and authority with
relation to any security (whether or not so deposited or transferred) as the
Trustees shall deem proper, and to agree to pay, and to pay, such portion of the
expenses and compensation of such committee, depositary or trustee as the
Trustees shall deem proper;
(j) To compromise, arbitrate or otherwise adjust claims in
favor of or against the Trust or any matter in controversy, including but not
limited to claims for taxes;
(k) To enter into joint ventures, general or limited
partnerships and any other combinations or associations;
(l) To borrow funds;
(m) To endorse or guarantee the payment of any notes or other
obligations of any person; to make contracts of guaranty or suretyship, or
otherwise assume liability for payment thereof; and to mortgage and pledge the
Trust property or any part thereof to secure any of or all such obligations;
(n) 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, investment advisers or managers, principal
underwriters, or independent contractors of the Trust individually against all
claims and liabilities of every nature arising by reason of holding, being or
having held any such office or position, or by reason of any action alleged to
have been taken or omitted by any such person as Shareholder, Trustee, officer,
employee, agent, investment adviser or manager, principal underwriter, or
independent contractor, including any 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;
(o) 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; and
(p) To engage in any other lawful act or activity in which
corporations organized under the Massachusetts Business Corporation Law may
engage.
The Trustees shall not in any way be bound or limited by any
present or future law or custom in regard to investments by trustees. Except as
otherwise provided herein or from time to time in 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 being present), within or without Massachusetts,
including any meeting held by means of a conference telephone or other
communications equipment by means of which all persons participating in the
meeting can hear each other at the same time and participation by such means
shall constitute presence in person at a meeting, or by written consents of a
majority of the Trustees then in office.
Section 3.3 Advisory, Management and Distribution. The
Trustees may, at any time and from time to time, contract for exclusive or
nonexclusive advisory and/or management services with any corporation, trust,
association or other organization (the "Advisor"), every such contract to comply
with such requirements and restrictions as may be set forth in the By-laws; and
any such contract may provide for one or more Sub-advisers who shall perform all
or part of the obligations of the Advisor under such contract and may contain
such other terms interpretive of or in addition to said requirements and
restrictions as the Trustees may determine, including, without limitation,
authority to determine from time to time what investments shall be purchased,
held, sold or exchanged and what portion, if any, of the assets of the Trust
shall be held uninvested and to make changes in the Trust's investments. The
Trustees may also, at any time and from time to time, contract with the Advisor
or any other corporation, trust, association or other organization, appointing
it exclusive or nonexclusive distributor or principal underwriter for the
Shares, every such contract to comply with such requirements and restrictions as
may be set forth in the By-laws; and any such contract may contain such other
terms interpretive of or in addition to said requirements and restrictions as
the Trustees may determine.
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 corporation, trust,
association, or other organization, or of or for any parent or
affiliate of any organization, with which an advisory or
management contract, or principal underwriter's or
distributor's contract, or transfer, shareholder servicing or
other agency contract may have been or may hereafter be made,
or that any such organization, or any parent or affiliate
thereof, is a Shareholder or has an interest in the Trust, or
that
(ii) any corporation, trust, association or other
organization with which an advisory or management contract or
principal underwriter's or distributor's contract, or
transfer, shareholder servicing or other agency contract may
have been or may hereafter be made also has an advisory or
management contract, or principal underwriter's or
distributor's contract, or transfer, Shareholder servicing or
other agency contract with one or more other corporations,
trusts, associations, or other organizations, or has other
business or interests
shall not affect the validity of any such contract 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 its Shareholders.
Section 3.4 Payment of Expenses by the Trust. 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, as they deem fair,
all expenses, fees, charges, taxes and liabilities incurred or arising in
connection with the Trust, in connection with the management thereof, or in
connection with the financing of the sale of Shares, including, but not limited
to, the Trustees' compensation and such expenses and charges for the services of
the Trust's officers, employees, any investment adviser, manager, or
sub-adviser, principal underwriter, auditor, counsel, custodian, transfer agent,
shareholder servicing agent, and such other agents or independent contractors
and such other expenses and charges as the Trustees may deem necessary or proper
to incur; provided, however, that all expenses, fees, charges, taxes and
liabilities incurred or arising in connection with a particular series or class
of Shares as determined by the Trustees, shall be payable solely out of the
assets of that series or class. Any general liabilities, expenses, costs,
charges or reserves of the Trust which are not readily identifiable as belonging
to any particular series shall be allocated and charged by the Trustees between
or among any one or more of the series in such manner as the Trustees in their
sole discretion deem fair and equitable. Each such allocation shall be
conclusive and binding upon the Shareholders of all series for all purposes. Any
creditor of any series may look only to the assets of that series to satisfy
such creditor's debt.
The Trustees shall have the power, as frequently as they may
determine, to cause each Shareholder to pay directly, in advance or arrears, for
any and all expenses of the Trust, an amount fixed from time to time by the
Trustees, by setting off such charges due from such Shareholder from declared
but unpaid dividends owed such Shareholder and/or by reducing the number of
Shares in the account of such Shareholder by that number of full and/or
fractional Shares which represents the outstanding amount of such charges due
from such Shareholder.
Section 3.5 Ownership of Assets of the Trust. Title to all of
the assets of the Trust shall at all times be considered as vested in the
Trustees.
ARTICLE IV
SHARES
Section 4.1 Beneficial Interest. The Shares of the Trust shall
have no par value and shall be issued in one or more classes or series as the
Trustees may, without shareholder approval, authorize. Each class or series of
Shares shall represent an equal proportionate interest in the assets and
liabilities of the Trust, with no class or series having priority or preference
over another. If the Trustees have authorized the issuance of two or more
classes or series of Shares, then the classes or series may have such variations
as to dividend, redemption, voting rights, net asset values, expenses borne by
the classes, and other matters as the Trustees have authorized. The number of
Shares authorized shall be unlimited.
Section 4.2 Ownership of Shares. The ownership of Shares shall
be recorded on the books of the Trust or a transfer or similar agent. No
certificates certifying the ownership of Shares shall be issued except as the
Trustees may otherwise determine from time to time. The Trustees may make such
rules as they consider appropriate for the issuance of Share certificates, the
transfer of Shares and similar matters. The record books of the Trust as kept by
the Trust or any transfer or similar agent, as the case may be, shall be
conclusive as to who are the Shareholders of each class or series and as to the
number of Shares of each class or series held from time to time by each
Shareholder.
Section 4.3 Investment in the Trust. The Trustees shall accept
investments in the Trust from such persons and on such terms and for such
consideration, which may consist of cash or tangible or intangible property or a
combination thereof, as they from time to time authorize.
All consideration received by the Trust for the issue or sale
of Shares of each class or series of Shares, together with all income, earnings,
profits, and proceeds thereof, including any proceeds derived from the sale,
exchange or liquidation thereof, and any funds or payments derived from any
reinvestment of such proceeds in whatever form the same may be, shall
irrevocably belong to the class or series of Shares with respect to which the
same were received by the Trust for all purposes, subject only to the rights of
creditors, and shall be so handled upon the books of account of the Trust and
are herein referred to as "assets of" such class or series of shares.
Section 4.4 No Preemptive Rights. Shareholders shall have no
preemptive or other right to subscribe to any additional Shares or other
securities issued by the Trust.
Section 4.5 Status of Shares and Limitation of Personal
Liability. Shares shall be deemed to be personal property giving only the rights
provided in this instrument. Every Shareholder by virtue of having become a
Shareholder shall be held to have expressly assented and agreed to the terms
hereof and to have become a party hereto. The death of a Shareholder during the
continuance of the Trust shall not operate to terminate the same nor entitle the
representative of any deceased Shareholder to an accounting or to take any
action in court or elsewhere against the Trust or the Trustees, but only to the
rights of said decedent under this Trust. Ownership of Shares shall not entitle
the Shareholder to any title in or to the whole or any part of the Trust
property or right to call for a partition or division of the same or for an
accounting, nor shall the ownership of Shares constitute the Shareholders
partners. Neither the Trust nor the Trustees, nor any officer, employee or agent
of the Trust shall have any power to bind personally any Shareholder, nor except
as specifically provided herein to call upon any Shareholder for the payment of
any sum of money or assessment whatsoever other than such as the Shareholder may
at any time personally agree to pay.
ARTICLE V
SHAREHOLDERS' VOTING POWERS AND MEETINGS
Section 5.1 Shareholders' Voting Powers and Meetings.
Shareholders shall have such power to vote as is provided for in, and may hold
meetings and take actions pursuant to the provisions of the By-laws.
ARTICLE VI
DISTRIBUTIONS AND REPURCHASES
Section 6.1 Distributions. The Trustees may each year, or more
frequently if they so determine, distribute to the Shareholders of each class or
series of Shares such income and capital gains, accrued or realized, as the
Trustees may determine, after providing for actual and accrued expenses and
liabilities (including such reserves as the Trustees may establish) determined
in accordance with good accounting practices. The Trustees shall have full
discretion to determine which items shall be treated as income and which items
as capital and their determination shall be binding upon the Shareholders.
Distributions of each year's income of each class or series of Shares shall be
distributed pro rata to Shareholders in proportion to the number of Shares of
each class or series held by each of them. Such distributions shall be made in
cash or Shares or a combination thereof as determined by the Trustees. Any such
distribution paid in Shares will be paid at the net asset value thereof as
determined in accordance with the By-laws.
Section 6.2 Repurchases. The Trustees may in their business
judgment authorize the Trust to repurchase all or a portion of its outstanding
classes or series of Shares at the net asset value of such Shares thereof as
determined in accordance with the By-Laws. Such Share repurchases are expected
to be in the form of tender offers by the Trust to the Shareholders.
Section 6.3 Dividends, Distributions and Repurchases. No
dividend or distribution (including, without limitation, any distribution paid
upon termination of the Trust or of a class or series of Shares) with respect to
the Shares shall be effected by the Trust other than from the assets of such
Trust. The Trust may borrow against its assets for the purpose of funding said
repurchase of Shares.
ARTICLE VII
COMPENSATION AND LIMITATION OF LIABILITY OF TRUSTEES
Section 7.1 Compensation. The Trustees as such shall be
entitled to reasonable compensation from the Trust; they may fix the amount of
their compensation. Nothing herein shall in any way prevent the employment of
any Trustee for advisory, management, legal, accounting, investment banking,
underwriting, brokerage, or investment dealer or other services and payment for
the same by the Trust.
Section 7.2 Limitation of Liability. The Trustees shall not
be responsible or liable in any event for any neglect or wrongdoing of any
officer, agent, employee, manager or principal underwriter of the Trust, nor
shall any Trustee be responsible for the act or omission of any other Trustee,
but nothing herein contained shall protect any Trustee against any liability to
which he or she would otherwise be subject by reason of wilful misfeasance, bad
faith, gross negligence or reckless disregard of the duties involved in the
conduct of his or her office.
Every note, bond, contract, instrument, certificate, Share or
undertaking and every other act or thing whatsoever executed or done by or on
behalf of the Trust or the Trustees or any of them in connection with the Trust
shall be conclusively deemed to have been executed or done only in or with
respect to their or his or her capacity as Trustees or Trustee, and such
Trustees or Trustee shall not be personally liable thereon.
ARTICLE VIII
INDEMNIFICATION
Section 8.1 Trustees, Officers, etc. The Trust shall indemnify
each of its Trustees and officers (including persons who serve at the Trust's
request as directors, officers or trustees of another organization in which the
Trust has any interest as a shareholder, creditor or otherwise) (hereinafter
referred to as a "Covered Person") against all liabilities and expenses,
including but not limited to amounts paid in satisfaction of judgments, in
compromise or as fines and penalties, and counsel fees reasonably 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 Covered Person except with respect to any matter as
to which such Covered Person shall have been finally adjudicated in any such
action, suit or other proceeding to be liable to the Trust or its Shareholders
by reason of wilful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of such Covered Person's office.
Expenses, including counsel fees so incurred by any such Covered Person (but
excluding amounts paid in satisfaction of judgments, in compromise or as fines
or penalties), shall be paid from time to time by the Trust in advance of the
final disposition of any such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such Covered Person to repay amounts so paid to
the Trust if it is ultimately determined that indemnification of such expenses
is not authorized under this Article; provided, however, that either (a) such
Covered Person shall have provided appropriate security for such undertaking,
(b) the Trust shall be insured against losses arising from any such advance
payments or (c) either a majority of the disinterested Trustees acting on the
matter (provided that a majority of the disinterested Trustees then in office
act on the matter), or independent legal counsel in a written opinion, shall
have determined, based upon a review of readily available facts (as opposed to a
full trial type inquiry) that there is reason to believe that such Covered
Person will be found entitled to indemnification under this Article.
Section 8.2 Compromise Payment. As to any matter disposed of
(whether by a compromise payment, pursuant to a consent decree or otherwise)
without an adjudication by a court, or by any other body before which the
proceeding was brought, that such Covered Person is liable to the Trust or its
Shareholders by reason of wilful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of his or her office,
indemnification shall be provided if (a) approved, after notice that it involves
such indemnification, by at least a majority of the disinterested Trustees
acting on the matter (provided that a majority of the disinterested Trustees
then in office act on the matter) upon a determination, based upon a review of
readily available facts (as opposed to a full trial type inquiry) that such
Covered Person is not liable to the Trust or its Shareholders by reasons of
wilful misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of his or her office, or (b) there has been
obtained an opinion in writing of independent legal counsel, based upon a review
of readily available facts (as opposed to a full trial type inquiry) to the
effect that such indemnification would not protect such Person against any
liability to the Trust or to its shareholders to which he or she would otherwise
be subject by reason of wilful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of his office. Any
approval pursuant to this Section shall not prevent the recovery from any
Covered Person of any amount paid to such Covered Person in accordance with this
Section as indemnification if such Covered Person is subsequently adjudicated by
a court of competent jurisdiction to have been liable to the Trust or its
Shareholders by reason of wilful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of such Covered
Person's office.
Section 8.3 Indemnification Not Exclusive. The right of
indemnification hereby provided shall not be exclusive of or affect any other
rights to which such Covered Person may be entitled. As used in this Article
VIII, the term "Covered Person" shall include such person's heirs, executors and
administrators and a "disinterested Trustee" is a Trustee who is not an
"interested person" of the Trust as defined in Section 2 (a)(19) of the
Investment Company Act of 1940, as amended, (or who has been exempted from being
an "interested person" by any rule, regulation or order of the Commission) and
against whom none of such actions, suits or other proceedings or another action,
suit or other proceeding on the same or similar grounds is then or has been
pending. Nothing contained in this Article shall affect any rights to
indemnification to which personnel of the Trust, other than Trustees or
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 8.4 Shareholders. In case any Shareholder or former
Shareholder shall be held to be personally liable solely by reason of his or her
being or having been a Shareholder and not because of his or her acts or
omissions or for some other reason, the Shareholder or former Shareholder (or
his or her heirs, executors, administrators or other legal representatives or in
the case of a corporation or other entity, its corporate or other general
successor) shall be entitled to be held harmless from and indemnified against
all loss and expense arising from such liability, but only out of the assets of
the particular class or series of Shares of which he or she is or was a
Shareholder.
ARTICLE IX
MISCELLANEOUS
Section 9.1 Trustees, Shareholders, etc. Not Personally
Liable; Notice. All persons extending credit to, contracting with or having any
claim against the Trust shall look only to the assets of the Trust for payment
under such credit, contract or claim; and neither the Shareholders nor the
Trustees, nor any of the Trust's officers, employees or agents, whether past,
present or future, shall be personally liable therefor. Nothing in this
Declaration of Trust shall protect any Trustee against any liability to which
such Trustee would otherwise be subject by reason of wilful misfeasance, bad
faith, gross negligence or reckless disregard of the duties involved in the
conduct of the office of Trustee.
Every note, bond, contract, instrument, certificate or
undertaking made or issued by the Trustees or by any officer or officers shall
give notice that this Amended Agreement and Declaration of Trust is on file with
the Secretary of the Commonwealth of Massachusetts and shall recite that the
same was executed or made by or on behalf of the Trust or by them as Trustee or
Trustees 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, and
may contain such further recital as he or she or they may deem appropriate, but
the omission thereof shall not operate to bind any Trustee or Trustees or
officer or officers or Shareholder or Shareholders individually.
Section 9.2 Trustee's 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. A Trustee shall be liable
for his or her own wilful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of the office of Trustee, and
for nothing else, and shall not be liable for errors of judgment or mistakes of
fact or law. The Trustees may take advice of counsel or other experts with
respect to the meaning and operation of this Amended Agreement and Declaration
of Trust, and shall be under no liability for any act or omission in accordance
with such advice or for failing to follow such advice. The Trustees shall not be
required to give any bond as such, nor any surety if a bond is required.
Section 9.3 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.
Section 9.4 Merger or Combination of Classes or Series of
Shares of the Trust. If permitted by regulatory authorities, the Trust, by
resolution of its Board of Trustees, may direct that the separate portfolios of
two or more classes or series of the Trust's shares be combined into a single
portfolio on such terms as the Board of Trustees may deem appropriate or which
regulatory authorities may require for the protection of the rights of holders
of each class or series of shares. If portfolios are combined, the following
provisions shall apply to the classes or series of shares:
(a) The assets of the combined portfolio and the income
from investment and reinvestment of the assets shall be
allocated to each class or series of shares in accordance with
the number of shares of that class or series outstanding for
purposes of determining the net asset value of each class or
series of shares, the amounts distributable to holders of
shares of each class or series of shares in the event of
dissolution and liquidation of the Trust and the dividends
payable with respect to shares of each class or series of
shares.
(b) The liabilities and expenses of the Trust with
respect to a class or series of the Trust's shares shall be
charged to that class or series. Liabilities and expenses
chargeable to more than one class of shares shall be allocated
by or in accordance with procedures adopted by the Board of
Trustees. The determination of the Board of Trustees shall be
conclusive as to the charging or allocation of liabilities.
(c) Each class or series of shares shall be entitled to
such dividends or distributions, in shares or cash or both, as
may be declared by the Board of Trustees with respect to such
class or series. Dividends or distributions may be paid only
out of net income or surplus of that class or series.
(d) In the event of the liquidation or dissolution of
the Trust, the holders of each class or series of the Trust's
shares shall be entitled to receive that class or series share
of the assets of the Trust less the liabilities of the Trust
allocable to that class or series as determined by or in
accordance with procedures adopted by the Board of Trustees.
The assets so distributable to the holders of a particular
class or series shall be distributed among them in proportion
to the number of shares of the class or series held by each of
them and recorded on the books of the Trust.
If the Board of Trustees orders the combination of portfolios of classes or
series of shares, it may at any time thereafter by resolution order that the
portfolios be segregated or combined with portfolios of other classes or series
on such terms as the Board of Trustees determines are desirable for the
protection of the interests of the Trust and its shareholders or to comply with
regulatory requirements.
Section 9.5 Duration and Termination of Trust. Unless
terminated as provided herein, the Trust shall continue without limitation of
time. The Trust may be terminated at any time by the vote of Shareholders
holding at least a majority of the Shares entitled to vote or by the Trustees by
written notice to the Shareholders. Any class or series of Shares may be
terminated at any time by vote of Shareholders holding at least a majority of
the Shares of such class or series entitled to vote or by the Trustees by
written notice to the Shareholders of such class or series.
Upon termination of the Trust or of any one or more classes or
series of Shares, after paying or otherwise providing for all charges, taxes,
expenses and liabilities, whether due or accrued or anticipated, of the Trust or
of the particular class or series as may be determined by the Trustees, the
Trust shall, in accordance with such procedures as the Trustees shall consider
appropriate, reduce the remaining assets to distributable form in cash or shares
or other securities, or any combination thereof, and distribute the proceeds to
the Shareholders of the series involved, ratably according to the aggregate net
asset value of Shares of such class or series of Shares held by the several
Shareholders of such class or series of Shares on the date of termination.
Section 9.6 Merger, Consolidation and Sale of Assets. Subject
to Section 9.8, the Trust may merge or consolidate with any other corporation,
association, trust or other organization, or may sell, lease or exchange all or
substantially all of the Trust Property, including its goodwill, upon such terms
and conditions and for such consideration when and as authorized at any meeting
of the Shareholders called for the purpose by the affirmative vote of the
holders of not less than two-thirds of the the Shares outstanding and entitled
to vote, or by an instrument or instruments in writing without a meeting,
consented to by the holders of not less than two-thirds of the Shares, provided,
however, that if such merger, consolidation, sale, lease or exchange is
recommended by the Trustees, the vote or written consent of the holders of a
majority of the Shares outstanding and entitled to vote shall be sufficient
authorization and any such merger, consolidation, sale, lease or exchange shall
be deemed for all purposes to have been accomplished under and pursuant to the
statutes of the Commonwealth of Massachusetts.
Section 9.7 Conversion to Open-End Management Investment
Company. Notwithstanding any other provisions of this Declaration or the
By-Laws, an amendment to this Declaration that makes the Common Shares a
"redeemable security" (as that term is defined in the 1940 Act) shall be
required to be approved by at least (a) a majority of the Trustees, including a
majority of the Trustees who are not Interested Persons; and (b) a Majority
Shareholder Vote.
The Trust shall notify the holders of all capital
securities of the approval, in accordance with the preceding paragraph of this
Section 9.7, of any amendment to this Declaration that makes the Shares a
"redeemable security" (as that term is defined in the 1940 Act) no later than
thirty (30) days prior to the date of filing of such amendment with the
Secretary of State of the Commonwealth of Massachusetts; provided, however, that
such amendment may not be so filed until the later of ninety (90) days following
the date of approval of such amendment by the holders of the Shares in
accordance with the preceding paragraph of this Section 9.7 or thirty (30) days
following the date on which notice of the approval of such amendment is first
given to Shareholders.
Section 9.8 Certain Transactions. (a) Notwithstanding any
other provision of this Declaration and subject to the exceptions provided in
paragraph (d) of this Section, the types of transactions described in paragraph
(c) of this Section shall require the affirmative vote or consent of the holders
of not less than two-thirds of the Shares outstanding and entitled to vote when
a Principal Shareholder (as defined in paragraph (b) of this Section) is a party
to the transaction. Such affirmative vote or consent shall be in addition to the
vote or consent of the holders of the Shares otherwise required by law or any
agreement between the Trust and any national securities exchange.
(b) The term "Principal Shareholder" shall mean any
corporation, person or other entity which is the beneficial owner, directly or
indirectly, of more than five percent (5%) of the outstanding Shares and shall
include any affiliate or associate, as such terms are defined in clause (ii)
below, of a Principal Shareholder. For the purposes of this Section, in addition
to the Shares which a corporation, person or other entity beneficially owns
directly, (a) any corporation, person or other entity shall be deemed to be the
beneficial owner of any Shares (i) which it has the right to acquire pursuant to
any agreement or upon exercise of conversion rights or warrants, or otherwise
(but excluding share options granted by the Trust), or (ii) which are
beneficially owned, directly or indirectly (including Shares deemed owned
through application of clause (i) above, by any other corporation, person or
entity with which it or its "affiliate" or "associate" (as defined below) has
any agreement, arrangement or understanding for the purpose of acquiring,
holding, voting or disposing of Shares, or which is its "affiliate" or
"associate" as those terms are defined in Rule 12b-2 under the Securities
Exchange Act of 1934, as amended, and (b) the outstanding Shares shall include
Shares deemed owned through application of clauses (i) and (ii) above but shall
not include any other Shares which may be issuable pursuant to any agreement, or
upon exercise of conversion rights or warrants, or otherwise.
(c) This Section shall apply to the following
transactions:
(1) The merger or consolidation of the Trust or
any subsidiary of the Trust with or into any Principal
Shareholder.
(2) The issuance of any securities of the Trust to
any Principal Shareholder for cash.
(3) The sale, lease or exchange of all or any
substantial part of the assets of the Trust to any Principal
Shareholder (except assets having an aggregate fair market
value of less than $1,000,000, aggregating for the purpose of
such computation all assets sold, leased or exchanged in any
series of similar transactions within a twelve-month period).
(4) The sale, lease or exchange to the Trust or
any subsidiary thereof, in exchange for securities of the
Trust of any assets of any Principal Shareholder (except
assets having an aggregate fair market value of less than
$1,000,000, aggregating for the purposes of such computation
all assets sold, leased or exchanged in any series of similar
transactions within a twelve-month period).
(d) The provisions of this Section shall not be
applicable to (i) any of the transactions described in paragraph (c) of this
Section if the Trustees shall by resolution have approved a memorandum of
understanding with such Principal Shareholder with respect to and substantially
consistent with such transaction, or (ii) any such transaction with any
corporation of which a majority of the outstanding shares of all classes of
stock normally entitled to vote in elections of trustees is owned of record or
beneficially by the Trust and its subsidiaries.
(e) The Trustees shall have the power and duty to
determine for the purposes of this Section, on the basis of information known to
the Trust, whether (i) a corporation, person or entity beneficially owns more
than five percent (5%) of the outstanding Shares, (ii) a corporation, person or
entity is an "affiliate" or "associate" (as defined above) of another, (iii) the
assets being acquired or leased to or by the Trust, or any subsidiary thereof,
constitute a substantial part of the assets of the Trust and have an aggregate
fair market value of less than $1,000,000, and (iv) the memorandum of
understanding referred to in paragraph (d) hereof is substantially consistent
with the transaction covered thereby. Any such determination shall be conclusive
and binding for all purposes of this Section.
Section 9.9 Amendments. This Declaration of Trust may be
amended at any time by an instrument in writing signed by a majority of the then
Trustees when authorized to do so by vote of Shareholders holding a majority of
the Shares of each class or series entitled to vote, except that an amendment
which shall affect the holders of one or more classes or series of Shares but
not the holders of all outstanding class or series shall be authorized by vote
of the Shareholders holding a majority of the Shares entitled to vote of each
class or series affected and no vote of Shareholders of a class or series not
affected shall be required. Any amendment which shall affect the holders of
Shares of one or more classes of a series but not the holders of all Shares of a
series shall be authorized by vote of the Shareholders holding a majority of the
Shares of such classes affected by the amendment voting together as a single
class, and no vote of Shareholders of the classes not affected shall be
required. Amendments having the purpose of changing the name of the Trust, of
establishing, changing, or eliminating the par value of the shares or of
supplying any omission, curing any ambiguity or curing, correcting or
supplementing any defective or inconsistent provision contained herein shall not
require authorization by Shareholder vote.
Section 9.10 Resident Agent. The Trust may appoint and
maintain a resident agent in the Commonwealth of Massachusetts.
Section 9.11 Filing of Copies; References; Headings. The
original or a copy of this instrument and of each amendment hereto shall be kept
at the office of the Trust where it may be inspected by any Shareholder. A copy
of this instrument and of each amendment hereto shall be filed by the Trust with
the Secretary of the Commonwealth of Massachusetts and with the Boston City
Clerk, as well as any other governmental office where such filing may from time
to time be required, but the failure to make any such filing shall not impair
the effectiveness of this instrument or any such amendment. Anyone dealing with
the Trust may rely on a certificate by an officer of the Trust as to whether or
not any such amendments have been made, as to the identities of the Trustees and
officers, and as to any matters in connection with the Trust hereunder; and,
with the same effect as if it were the original, may rely on a copy certified by
an officer of the Trust to be a copy of this instrument or of any such
amendments. In this instrument and in any such amendment, references to this
instrument, and all expressions like "herein", "hereof" and "hereunder" shall be
deemed to refer to this instrument as a whole as the same may be amended or
affected by any such amendments. 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 hereof or control or affect the meaning,
construction or effect of this instrument. This instrument may be executed in
any number of counterparts each of which shall be deemed an original.
Section 9.12 Applicable Law. This Amended Agreement and
Declaration of Trust is made in the Commonwealth of Massachusetts, and it is
created under and is to be governed by and construed and administered according
to the laws of said Commonwealth, including the Massachusetts Business
Corporation Law as the same may be amended from time to time, to which reference
is made with the intention that matters not specifically covered herein or as to
which an ambiguity may exist shall be resolved as if the Trust were a business
corporation organized in Massachusetts, but the reference to said Business
Corporation Law is not intended to give the Trust, the Trustees, the
Shareholders or any other person any right, power, authority or responsibility
available only to or in connection with an entity organized in corporate form.
The Trust shall be of the type referred to in Section 1 of Chapter 182 of the
Massachusetts General Laws and of the type commonly called a Massachusetts
business trust, and without limiting the provisions hereof, the Trust may
exercise all powers which are ordinarily exercised by such a trust.
Section 9.13 Provisions in Conflict with Laws and Regulations.
(a) The provisions of this Amended Agreement and Declaration of Trust are
severable, and if the Trustees shall determine, with the advice of counsel, that
any of such provisions is in conflict with the 1940 Act, the regulated
investment company provisions of the Internal Revenue Code of 1986, or any
amendments or successor statute thereto, or with other applicable laws and
regulations, the conflicting provision shall be deemed not to constitute and
never to have constituted a part of the Declaration; provided, however, that
such determination shall not affect any of the remaining provisions of the
Amended Agreement and Declaration of Trust or render invalid or improper any
action taken or omitted prior to such determination.
(b) If any provision of the Amended Agreement and
Declaration of Trust shall be held invalid or unenforceable in any jurisdiction,
such invalidity or unenforceability shall apply only to such provision in such
jurisdiction and shall not in any manner affect such provision in any other
jurisdiction or any other provision of the Declaration in any jurisdiction.
Section 9.14 Use of the Name. Sierra Investment Advisors
Corporation ("Sierra Advisors") has consented to the use by the Trust of the
identifying word or name "Sierra" in the name of the Trust. Such consent is
conditioned upon the employment of Sierra Advisors, its successors or any
affiliate thereof as Investment Advisor or administrator of the Trust. As
between the Trust and Sierra, Sierra controls the use of the name of the Trust
insofar as such name contains "Sierra." The name or identifying word "Sierra"
may be used from time to time in other connections and for other purposes by
Sierra or affiliated entities. Sierra may require the Trust to cease using
"Sierra" in the name of the Trust if the Trust ceases to employ, for any reason,
Sierra, an affiliate or any successor as Investment Advisor of the Trust.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
and seal for himself and his assigns, as of the ____ day of January, 1996.
-------------------------------
F. Xxxxx Xxxxxx
THE STATE OF CALIFORNIA
COUNTY OF LOS ANGELES January ___, 1996
Then personally appeared the above-named F. Xxxxx Xxxxxx and
acknowledged the foregoing instrument to be his free act and deed, before me.
---------------------------
Notary Public
My. Commission expires:
[Notary Seal]
