EXHIBIT (1)
THE GABELLI UTILITY FUND
____________________________________________
AGREEMENT AND DECLARATION OF TRUST
____________________________________________
MARCH 29, 1999
TABLE OF CONTENTS
ARTICLE I
The Trust
1.1 Name . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.2 Definitions . . . . . . . . . . . . . . . . . . . . . . . 3
1.3 Purpose and Powers of Trust . . . . . . . . . . . . . . . 5
ARTICLE II
Trustees
2.1 Number and Qualification . . . . . . . . . . . . . . . . . 5
2.2 Term and Election . . . . . . . . . . . . . . . . . . . . 5
2.3 Resignation and Removal . . . . . . . . . . . . . . . . . 6
2.4 Vacancies . . . . . . . . . . . . . . . . . . . . . . . . 6
2.5 Meetings . . . . . . . . . . . . . . . . . . . . . . . . . 7
2.6 Officers . . . . . . . . . . . . . . . . . . . . . . . . . 8
ARTICLE III
Powers and Duties of Trustees
3.1 General . . . . . . . . . . . . . . . . . . . . . . . . . 8
3.2 Investments . . . . . . . . . . . . . . . . . . . . . . . 8
3.3 Legal Title . . . . . . . . . . . . . . . . . . . . . . . 9
3.4 Issuance and Repurchase of Shares . . . . . . . . . . . . 9
3.5 Borrow Money or Utilize Leverage . . . . . . . . . . . . 10
3.6 Collection and Payment . . . . . . . . . . . . . . . . . 10
3.7 Expenses . . . . . . . . . . . . . . . . . . . . . . . . 10
3.8 By-Laws . . . . . . . . . . . . . . . . . . . . . . . . 11
3.9 Miscellaneous Powers . . . . . . . . . . . . . . . . . . 11
3.10 Delegation; Committees . . . . . . . . . . . . . . . . 11
3.11 Further Powers . . . . . . . . . . . . . . . . . . . . 12
ARTICLE IV
Limitations of Liability
and Indemnification
4.1 No Personal Liability of Shareholders, Trustees, etc. . 12
4.2 Mandatory Indemnification . . . . . . . . . . . . . . . 13
4.3 No Duty of Investigation; Notice in Trust Instruments,
etc. . . . . . . . . . . . . . . . . . . . . . . . . . 14
4.4 Reliance on Experts, etc . . . . . . . . . . . . . . . . 15
ARTICLE V
Shares of Beneficial Interest
5.1 Beneficial Interest . . . . . . . . . . . . . . . . . . 15
5.2 Classes and Series . . . . . . . . . . . . . . . . . . . 15
5.3 Issuance of Shares . . . . . . . . . . . . . . . . . . . 16
5.4 Rights of Shareholders . . . . . . . . . . . . . . . . . 16
5.5 Trust Only . . . . . . . . . . . . . . . . . . . . . . . 16
5.6 Register of Shares . . . . . . . . . . . . . . . . . . . 17
5.7 Transfer Agent and Registrar . . . . . . . . . . . . . . 17
5.8 Transfer of Shares . . . . . . . . . . . . . . . . . . . 17
5.9 Notices . . . . . . . . . . . . . . . . . . . . . . . . 18
5.10 Net Asset Value . . . . . . . . . . . . . . . . . . . . 18
5.11 Distributions to Shareholders. . . . . . . . . . . . . 18
ARTICLE VI
Shareholders
6.1 Meetings of Shareholders . . . . . . . . . . . . . . . . 19
6.2 Voting . . . . . . . . . . . . . . . . . . . . . . . . . 19
6.3 Notice of Meeting, Shareholder Proposals and Record Date 20
6.4 Quorum and Required Vote . . . . . . . . . . . . . . . . 20
6.5 Proxies, etc. . . . . . . . . . . . . . . . . . . . . . 21
6.6 Reports . . . . . . . . . . . . . . . . . . . . . . . . 22
6.7 Inspection of Records . . . . . . . . . . . . . . . . . 22
6.8 Shareholder Action by Written Consent . . . . . . . . . 22
ARTICLE VII
Duration: Termination of Trust;
Amendment; Mergers, Etc.
7.1 Duration . . . . . . . . . . . . . . . . . . . . . . . . 22
7.2 Termination. . . . . . . . . . . . . . . . . . . . . . . 22
7.3 Amendment Procedure. . . . . . . . . . . . . . . . . . . 23
7.4 Merger, Consolidation and Sale of Assets . . . . . . . . 24
7.5 Redemption; Conversion . . . . . . . . . . . . . . . . . 25
7.6 Certain Transactions . . . . . . . . . . . . . . . . . . 25
ARTICLE VIII
Miscellaneous
8.1 Filing . . . . . . . . . . . . . . . . . . . . . . . . . 27
8.2 Resident Agent . . . . . . . . . . . . . . . . . . . . . 28
8.3 Governing Law . . . . . . . . . . . . . . . . . . . . . 28
8.4 Counterparts . . . . . . . . . . . . . . . . . . . . . . 28
8.5 Reliance by Third Parties . . . . . . . . . . . . . . . 28
8.6 Provisions in Conflict with Law or Regulation . . . . . 29
THE GABELLI UTILITY FUND
AGREEMENT AND DECLARATION OF TRUST
AGREEMENT AND DECLARATION OF TRUST made as of the 29th day of
March, 1999, by the Trustees hereunder, and by the holders of shares of
beneficial interest issued hereunder as hereinafter provided.
WHEREAS, this Trust has been formed to carry on business as set
forth more particularly hereinafter;
WHEREAS, this Trust is authorized to issue an unlimited number of
its shares of beneficial interest all in accordance with the provisions
hereinafter set forth;
WHEREAS, the Trustees have agreed to manage all property coming
into their hands as Trustees of a Delaware business trust in accordance
with the provisions hereinafter set forth; and
WHEREAS, the parties hereto intend that the Trust created by this
Declaration and the Certificate of Trust filed with the Secretary of State
of the State of Delaware on February 25th, 1999 shall constitute a business
trust under the Delaware Business Trust Statute and that this Declaration
shall constitute the governing instrument of such business trust.
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 as
hereinafter set forth.
ARTICLE I
The Trust
1.1 Name. This Trust shall be known as the "The Gabelli Utility
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.
1.2 Definitions. As used in this Declaration, the following
terms shall have the following meanings:
The terms "Affiliated Person", "Assignment", "Commission",
"Interested Person" and "Principal Underwriter" shall have the meanings
given them in the 1940 Act.
"By-Laws" shall mean the By-Laws of the Trust as amended from
time to time by the Trustees.
"Code" shall mean the Internal Revenue Code of 1986, as amended,
and the regulations promulgated thereunder.
"Commission" shall mean the Securities and Exchange Commission.
"Declaration" shall mean this Agreement and Declaration of Trust,
as amended or amended and restated from time to time, including by way of
any supplement authorizing or creating any class of Shares or any series of
any such class.
"Delaware Business Trust Statute" shall mean the provisions of
the Delaware Business Trust Act, 12 Del. C. section3801, et. seq., as such
Act may be amended from time to time.
"Fundamental Policies" shall mean the investment policies and
restrictions as set forth from time to time in any Prospectus or contained
in any current Registration Statement of the Trust filed with the
Securities and Exchange Commission or as otherwise adopted by the Trustees
and the Shareholders in accordance with the requirements of the 1940 Act
and designated as fundamental policies therein as they may be amended from
time to time in accordance with the requirements of the 1940 Act.
"Majority Shareholder Vote" shall mean a vote of a majority of
the outstanding voting securities (as such term is defined in the 1940 Act)
of the Trust or the applicable class or classes of such voting securities.
"Person" shall mean and include natural persons, corporations,
partnerships, trusts, limited liability companies, associations, joint
ventures and other entities, whether or not legal entities, and governments
and agencies and political subdivisions thereof.
"Prospectus" shall mean the currently effective Prospectus of the
Trust, if any, under the Securities Act of 1933, as amended.
"Shareholders" shall mean as of any particular time the holders
of record of outstanding Shares of the Trust, at such time.
"Shares" shall mean the transferable units of beneficial interest
into which the beneficial interest in the Trust shall be divided from time
to time and includes fractions of Shares as well as whole Shares. All
references to Shares shall be deemed to be Shares of any or all Series or
classes or series thereof as the context may require.
"Trust" shall mean the trust established by this Declaration, as
amended from time to time, inclusive of each such amendment.
"Trustees" shall mean the signatory to this Declaration, so long
as he shall continue in office in accordance with the terms hereof, and all
other persons who at the time in question have been duly elected or
appointed and have qualified as trustees in accordance with the provisions
hereof and are then in office.
"Trust Property" shall mean as of any particular time any and all
property, real or personal, tangible or intangible, which at such time is
owned or held by or for the account of the Trust or the Trustees in such
capacity.
The "1933 Act" refers to the Securities Act of 1933 and the rules
and regulations promulgated thereunder and exemptions therefrom covering
the Trust and its affiliated persons, as amended from time to time.
The "1940 Act" refers to the Investment Company Act of 1940 and
the rules and regulations promulgated thereunder and exemptions granted
therefrom, as amended from time to time.
1.3 Purpose and Powers of Trust. The Trust is established for
the purpose of engaging in any activity not prohibited by Delaware law and
shall have the power to engage in any such activity and in any activity
incidental or related to any such activity.
ARTICLE II
Trustees
2.1 Number and Qualification. Prior to a public offering of
Shares, there may be a sole Trustee and thereafter the number of Trustees
shall be such number, not less than three or more than fifteen, as shall be
set forth in a written instrument signed or adopted by a majority of the
Trustees then in office. No reduction in the number of Trustees shall have
the effect of removing any Trustee from office prior to the expiration of
his term. An individual nominated as a Trustee shall be at least 21 years
of age and not older than such age as shall be set forth in a written
instrument signed or adopted by a majority of the Trustees then in office
and shall not be under legal disability. Trustees need not own Shares and
may succeed themselves in office.
2.2 Term and Election. The Board of Trustees shall be divided
into three classes. Within the limits specified in Section 2.1, the number
of the Trustees in each class shall be determined by resolution of the
Board of Trustees. The initial term of office of the first class shall
expire on the date of the first annual meeting of Shareholders or special
meeting in lieu thereof. The initial term of office of the second class
shall expire on the date of the second annual meeting of Shareholders or
special meeting in lieu thereof. The initial term of office of the third
class shall expire on the date of the third annual meeting of Shareholders
or special meeting in lieu thereof. Upon expiration of the initial term of
office of each class as set forth above and the expiration of each
subsequent term of office of such class, the number of Trustees in such
class, as determined by the Board of Trustees, shall be elected for a term
expiring on the date of the third annual meeting of Shareholders or special
meeting in lieu thereof following such expiration to succeed the Trustees
whose terms of office expire. The Trustees shall be elected at an annual
meeting of the Shareholders or special meeting in lieu thereof called for
that purpose, except as provided in Section 2.4 of this Article, and each
Trustee elected shall hold office until his or her successor shall have
been elected and shall have qualified, except as provided in Section 2.3.
2.3 Resignation and Removal. Any Trustee may resign his trust
(without need for prior or subsequent accounting) by an instrument in
writing signed by him and delivered or mailed to the Chairman, if any, the
President or the Secretary and such resignation shall be effective upon
such delivery, or at a later date according to the terms of the instrument.
Any Trustee may be removed (provided the aggregate number of Trustees after
such removal shall not be less than the number required by Section 2.1
hereof) for cause at any time by written instrument, signed by two-thirds
of the remaining Trustees, specifying the date when such removal shall
become effective. Any Trustee may be removed (provided the aggregate
number of Trustees after such removal shall not be less than the minimum
number required by Section 2.1 hereof) without cause at any time by a
written instrument, signed or adopted by two-thirds of the remaining
Trustees or by vote of Shares having not less than two-thirds of the
aggregate number of Shares entitled to vote in the election of such
Trustee, specifying the date when such removal shall become effective.
Upon the resignation or removal of a Trustee, or such persons otherwise
ceasing to be a Trustee, such persons shall execute and deliver such
documents as the remaining Trustees shall require for the purpose of
conveying to the Trust or the remaining Trustees any Trust Property held in
the name of the resigning or removed Trustee. Upon the incapacity or death
of any Trustee, such Trustee's legal representative shall execute and
deliver on such Trustee's behalf such documents as the remaining Trustees
shall require as provided in the preceding sentence.
2.4 Vacancies. The term of office of a Trustee shall terminate
and a vacancy shall occur in the event of the death, resignation,
bankruptcy, adjudicated incompetence or other incapacity to perform the
duties of the office, or removal, of a Trustee. Whenever a vacancy in the
Board of Trustees shall occur, the remaining Trustees may fill such vacancy
by appointing an individual having the qualifications described in this
Article by a written instrument signed or adopted by a majority of the
Trustees then in office or by election by the Shareholders, or may leave
such vacancy unfilled or may reduce the number of Trustees (provided the
aggregate number of Trustees after such reduction shall not be less than
the minimum number required by Section 2.1 hereof). Any vacancy created by
an increase in Trustees may be filled by the appointment of an individual
having the qualifications described in this Article made by a written
instrument signed by a majority of the Trustees then in office or by
election by the Shareholders. No vacancy shall operate to annul this
Declaration or to revoke any existing agency created pursuant to the terms
of this Declaration. Whenever a vacancy in the number of Trustees shall
occur, until such vacancy is filled as provided herein, the Trustees in
office, 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.
2.5 Meetings. Meetings of the Trustees shall be held from time
to time upon the call of the Chairman, if any, the President, the Secretary
or any two Trustees. Regular meetings of the Trustees may be held without
call or notice at a time and place fixed by the By-Laws or by resolution of
the Trustees. Notice of any other meeting shall be mailed not less than 48
hours before the meeting or otherwise actually delivered orally or in
writing not less than 24 hours before the meeting, but may be waived in
writing by any Trustee either before or after such meeting. The attendance
of a Trustee at a meeting shall constitute a waiver of notice of such
meeting except where a Trustee attends a meeting for the express purpose of
objecting to the transaction of any business on the ground that the meeting
has not been lawfully called or convened. The Trustees may act with or
without a meeting. A quorum for all meetings of the Trustees shall be one-
third of the Trustees. Unless provided otherwise in this Declaration of
Trust, any action of the Trustees may be taken at a meeting by vote of a
majority of the Trustees present (a quorum being present) or without a
meeting by written consent of a majority of the Trustees or such other
proportion as shall be specified herein for action at a meeting at which
all Trustees then in office are present.
Any committee of the Trustees, including an executive committee,
if any, may act with or without a meeting. A quorum for all meetings of
any such committee shall be a majority of the members thereof. Unless
provided otherwise in this Declaration, any action of any such committee
may be taken at a meeting by vote of a majority of the members present (a
quorum being present) or without a meeting by written consent of a majority
of the members or such other proportion as shall be specified herein for
action at a meeting at which all committee members are present.
With respect to actions of the Trustees and any committee of the
Trustees, Trustees who are Interested Persons in any action to be taken may
be counted for quorum purposes under this Section and shall be entitled to
vote to the extent not prohibited by the 1940 Act.
All or any one or more Trustees may participate in a meeting of
the Trustees or any committee thereof by means of a conference telephone or
similar communications equipment by means of which all persons
participating in the meeting can hear each other; participation in a
meeting pursuant to any such communications system shall constitute
presence in person at such meeting except as otherwise provided by the 1940
Act.
2.6 Officers. The Trustees shall elect a President, a Secretary
and a Treasurer and may elect a Chairman who shall serve at the pleasure of
the Trustees or until their successors are elected. The Trustees may elect
or appoint or may authorize the Chairman, if any, or President to appoint
such other officers or agents with such other titles and powers as the
Trustees may deem to be advisable. A Chairman shall, and the President,
Secretary and Treasurer may, but need not, be a Trustee.
ARTICLE III
Powers and Duties of Trustees
3.1 General. The Trustees shall owe to the Trust and its
Shareholders the same fiduciary duties as owed by directors of corporations
to such corporations and their stockholders under the general corporation
law of the State of Delaware. The Trustees shall have exclusive and
absolute control over the Trust Property and over the business of the Trust
to the same extent as if the Trustees were the sole owners of the Trust
Property and business in their own right, but with such powers of
delegation as may be permitted by this Declaration. The Trustees shall
have power to engage in any activity not prohibited by Delaware law. The
enumeration of any specific power herein shall not be construed as limiting
the aforesaid power. The Trustees may perform such acts as in their sole
discretion are proper for conducting the business of the Trust. The powers
of the Trustees may be exercised without order of or resort to any court.
No Trustee shall, be obligated to give any bond or other security for the
performance of any of his duties or powers hereunder.
3.2 Investments. The Trustees shall have power to:
(a) manage, conduct, operate and carry on the business of
an investment company;
(b) subscribe for, invest in, reinvest in, purchase or
otherwise acquire, hold, pledge, sell, assign, transfer, exchange,
distribute or otherwise deal in or dispose of any and all sorts of
property, tangible or intangible, including but not limited to securities
of any type whatsoever, whether equity or non-equity, of any issuer,
evidences of indebtedness of any person and any other rights, interests,
instruments or property of any sort and to exercise any and all rights,
powers and privileges of ownership or interest in respect of any and all
such investments of every kind and description, including, without
limitation, the right to consent and otherwise act with respect thereto,
with power to designate one or more Persons to exercise any of said rights,
powers and privileges in respect of any of said investments. The Trustees
shall not be limited by any law limiting the investments which may be made
by fiduciaries.
3.3 Legal Title. 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 in the
name of any other Person as nominee, custodian or pledgee, on such terms as
the Trustees may determine, provided that the interest of the Trust 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 his due election and qualification. Upon the ceasing of any
person to be a Trustee for any reason, such person 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.
3.4 Issuance and Repurchase of Shares. Subject to the
provisions of this Declaration and applicable law, the Trustees shall have
the power to issue, sell, repurchase, redeem, retire, cancel, acquire,
hold, resell, reissue, dispose of, transfer, and otherwise deal in, Shares,
including Shares in fractional denominations, and to apply to any such
repurchase, redemption, retirement, cancellation or acquisition of Shares
any funds or property whether capital or surplus or otherwise, to the full
extent now or hereafter permitted by the laws of the State of Delaware
governing business corporations.
3.5 Borrow Money or Utilize Leverage. The Trustees shall have
the power to borrow money or otherwise obtain credit or utilize leverage in
connection with the activities of the Trust to the maximum extent permitted
by law regulation or order and to secure the same by mortgaging, pledging
or otherwise subjecting as security the assets of the Trust, including the
lending of portfolio securities, and to endorse, guarantee, or undertake
the performance of any obligation, contract or engagement of any other
person, firm, association or corporation.
3.6 Collection and Payment. The Trustees shall have power to
collect all property due to the Trust; to pay all claims, including taxes,
against the Trust Property or the Trust, the Trustees or any officer,
employee or agent of the Trust; to prosecute, defend, compromise or abandon
any claims relating to the Trust Property or the Trust, or the Trustees or
any officer, employee or agent of the Trust; to foreclose any security
interest securing any obligations, by virtue of which any property is owed
to the Trust; and to enter into releases, agreements and other instruments.
Except to the extent required for a Delaware business corporation, the
Shareholders shall have no power to vote as to whether or not a court
action, legal proceeding or claim should or should not be brought or
maintained derivatively or as a class action on behalf of the Trust or the
Shareholders.
3.7 Expenses. The Trustees shall have power to incur and pay
out of the assets or income of the Trust any expenses which in the opinion
of the Trustees are necessary or appropriate to carry out any of the
purposes of this Declaration, and the business of the Trust, and to pay
reasonable compensation from the funds of the Trust to themselves as
Trustees. The Trustees shall fix the compensation of all officers,
employees and Trustees. The Trustees may pay themselves such compensation
for special services, including legal, underwriting, syndicating and
brokerage services, as they in good faith may deem reasonable and
reimbursement for expenses reasonably incurred by themselves on behalf of
the Trust. The Trustees shall have the power, as frequently as they may
determine, to cause each Shareholder to pay directly, in advance or
arrears, for charges of distribution, of the custodian or transfer,
shareholder servicing or similar agent, a pro rata amount as defined from
time to time by the Trustees, by setting off such charges due from such
Shareholder from declared but unpaid dividends or distributions 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.
3.8 By-Laws. The Trustees may adopt and from time to time amend
or repeal By-Laws for the conduct of the business of the Trust. Such By-
Laws shall be binding on the Trust and the Shareholders unless inconsistent
with the provisions of this Declaration.
3.9 Miscellaneous Powers. The Trustees shall have the power to:
(a) employ or contract with such Persons as the Trustees may deem desirable
for the transaction of the business of the Trust, including investment
advisors, administrators, custodians, transfer agents, shareholder services
providers, accountants, counsel, brokers, dealers and others; (b) enter
into joint ventures, partnerships and any other combinations or
associations; (c) purchase, and pay for out of Trust Property, insurance
policies insuring the Shareholders, Trustees, officers, employees, agents,
investment advisors, distributors, selected dealers or independent
contractors of the Trust against all claims arising by reason of holding
any such position or by reason of any action taken or omitted by any such
Person in such capacity, whether or not constituting negligence, or whether
or not the Trust would have the power to indemnify such Person against such
liability; (d) establish pension, profit-sharing, share purchase, and other
retirement, incentive and benefit plans for any Trustees, officers,
employees and agents of the Trust; (e) make donations, irrespective of
benefit to the Trust, for charitable, religious, educational, scientific,
civic or similar purposes; (f) to the extent permitted by applicable law,
indemnify any Person with whom the Trust has dealings, including without
limitation any investment adviser, administrator, manager, transfer agent,
custodian, distributor or selected dealer, or any other person as the
Trustees may see fit to such extent as the Trustees shall determine; (g)
guarantee indebtedness or contractual obligations of others; (h) determine
and change the fiscal year of the Trust and the method in which its
accounts shall be kept; and (i) adopt a seal for the Trust but the absence
of such seal shall not impair the validity of any instrument executed on
behalf of the Trust.
3.10 Delegation; Committees. The Trustees shall have the power,
consistent with their continuing exclusive authority over the management of
the Trust and the Trust Property, to delegate from time to time to such of
their number or to officers, employees or agents of the Trust the doing of
such things and the execution of such instruments either in the name of the
Trust or the names of the Trustees or otherwise as the Trustees may deem
expedient, to at least the same extent as such delegation is permitted to
directors of a Delaware business corporation and is permitted by the 1940
Act, as well as any further delegations the Trustees may determine to be
desirable, expedient or necessary in order to effect the purpose hereof.
The Trustees may designate one or more committees each of which shall have
all or such lesser portion of the power and authority of the entire Board
of Trustees as the Trustees shall determine from time to time, except to
the extent action by the entire Board of Trustees or particular Trustees is
required by the 1940 Act.
3.11 Further Powers. The Trustees shall have the power to
conduct the business of the Trust and carry on its operations in any and
all of its branches and maintain offices both within and without the State
of Delaware, in any and all states of the United States of America, in the
District of Columbia, and in any and all commonwealths, territories,
dependencies, colonies, possessions, agencies or instrumentalities of the
United States of America and of foreign governments, and to do all such
other things and execute all such instruments as they deem necessary,
proper or desirable in order to promote the interests of the Trust although
such 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, the
presumption shall be in favor of a grant of power to the Trustees.
ARTICLE IV
Limitations of Liability
and Indemnification
4.1 No Personal Liability of Shareholders, Trustees, etc. No
Shareholder of the Trust shall be subject in such capacity to any personal
liability whatsoever to any Person in connection with Trust Property or the
acts, obligations or affairs of the Trust. Shareholders shall have the
same limitation of personal liability as is extended to stockholders of a
private corporation for profit incorporated under the general corporation
law of the State of Delaware. No Trustee or officer of the Trust shall be
subject in such capacity to any personal liability whatsoever to any
Person, other than the Trust or its Shareholders, in connection with Trust
Property or the affairs of the Trust, save only liability to the Trust or
its Shareholders arising from bad faith, willful misfeasance, gross
negligence or reckless disregard for his duty to such Person; and, subject
to the foregoing exception, all such Persons shall look solely to the Trust
Property for satisfaction of claims of any nature arising in connection
with the affairs of the Trust. If any Shareholder, Trustee or officer, as
such, of the Trust, is made a party to any suit or proceeding to enforce
any such liability, subject to the foregoing exception, he shall not, on
account thereof, be held to any personal liability.
4.2 Mandatory Indemnification. (a) The Trust shall indemnify
the Trustees and officers of the Trust (each such person being an
"indemnitee") against any liabilities and expenses, including amounts paid
in satisfaction of judgments, in compromise or as fines and penalties, and
reasonable counsel fees reasonably incurred by such indemnitee in
connection with the defense or disposition of any action, suit or other
proceeding, whether civil or criminal, before any court or administrative
or investigative body in which he may be or may have been involved as a
party or otherwise (other than, except as authorized by the Trustees, as
the plaintiff or complainant) or with which he may be or may have been
threatened, while acting in any capacity set forth above in this Section
4.2 by reason of his having acted in any such capacity, except with respect
to any matter as to which he shall not have acted in good faith in the
reasonable belief that his action was in the best interest of the Trust or,
in the case of any criminal proceeding, as to which he shall have had
reasonable cause to believe that the conduct was unlawful, provided,
however, that no indemnitee shall be indemnified hereunder against any
liability to any person or any expense of such indemnitee arising by reason
of (i) willful misfeasance, (ii) bad faith, (iii) gross negligence
(negligence in the case of Affiliated Indemnitees), or (iv) reckless
disregard of the duties involved in the conduct of his position (the
conduct referred to in such clauses (i) through (iv) being sometimes
referred to herein as "disabling conduct"). Notwithstanding the foregoing,
with respect to any action, suit or other proceeding voluntarily prosecuted
by any indemnitee as plaintiff, indemnification shall be mandatory only if
the prosecution of such action, suit or other proceeding by such indemnitee
was authorized by a majority of the Trustees.
(b) Notwithstanding the foregoing, no indemnification shall
be made hereunder unless there has been a determination (1) by a final
decision on the merits by a court or other body of competent jurisdiction
before whom the issue of entitlement to indemnification hereunder was
brought that such indemnitee is entitled to indemnification hereunder or,
(2) in the absence of such a decision, by (i) a majority vote of a quorum
of those Trustees who are neither Interested Persons of the Trust nor
parties to the proceeding ("Disinterested Non-Party Trustees"), that the
indemnitee is entitled to indemnification hereunder, or (ii) if such quorum
is not obtainable or even if obtainable, if such majority so directs,
independent legal counsel in a written opinion conclude that the indemnitee
should be entitled to indemnification hereunder. All determinations to
make advance payments in connection with the expense of defending any
proceeding shall be authorized and made in accordance with the immediately
succeeding paragraph (c) below.
(c) The Trust shall make advance payments in connection
with the expenses of defending any action with respect to which
indemnification might be sought hereunder if the Trust receives a written
affirmation by the indemnitee of the indemnitee's good faith belief that
the standards of conduct necessary for indemnification have been met and a
written undertaking to reimburse the Trust unless it is subsequently
determined that he is entitled to such indemnification and if a majority of
the Trustees determine that the applicable standards of conduct necessary
for indemnification appear to have been met. In addition, at least one of
the following conditions must be met: (1) the indemnitee shall provide
adequate security for his undertaking, (2) the Trust shall be insured
against losses arising by reason of any lawful advances, or (3) a majority
of a quorum of the Disinterested Non-Party Trustees, or if a majority vote
of such quorum so direct, independent legal counsel in a written opinion,
shall conclude, based on a review of readily available facts (as opposed to
a full trial-type inquiry), that there is substantial reason to believe
that the indemnitee ultimately will be found entitled to indemnification.
(d) The rights accruing to any indemnitee under these
provisions shall not exclude any other right to which he may be lawfully
entitled.
(e) Notwithstanding the foregoing, subject to any
limitations provided by the 1940 Act and this Declaration, the Trust shall
have the power and authority to indemnify Persons providing services to the
Trust to the full extent provided by law as if the Trust were a corporation
organized under the Delaware General Corporation Law provided that such
indemnification has been approved by a majority of the Trustees.
4.3 No Duty of Investigation; Notice in Trust Instruments, etc.
No purchaser, lender, transfer agent or other person dealing with the
Trustees or with any officer, employee or agent 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 said officer, employee or agent or be
liable for the application of money or property paid, loaned, or delivered
to or on the order of the Trustees or of said officer, employee or agent.
Every obligation, contract, undertaking, instrument, certificate, Share,
other security of the Trust, and every other act or thing whatsoever
executed in connection with the Trust shall be conclusively taken to have
been executed or done by the executors thereof only in their capacity as
Trustees under this Declaration or in their capacity as officers, employees
or agents of the Trust. The Trustees may maintain insurance for the
protection of the Trust Property, its Shareholders, Trustees, officers,
employees and agents in such amount as the Trustees shall deem adequate to
cover possible liability, and such other insurance as the Trustees in their
sole judgment shall deem advisable or is required by the 1940 Act.
4.4 Reliance on Experts, etc. Each Trustee and officer or
employee of the Trust shall, in the performance of its duties, be fully and
completely justified and protected with regard to any act or any failure to
act resulting from reliance in good faith upon the books of account or
other records of the Trust, upon an opinion of counsel, or upon reports
made to the Trust by any of the Trust's officers or employees or by any
advisor, administrator, manager, distributor, selected dealer, accountant,
appraiser or other expert or consultant selected with reasonable care by
the Trustees, officers or employees of the Trust, regardless of whether
such counsel or other person may also be a Trustee.
ARTICLE V
Shares of Beneficial Interest
5.1 Beneficial Interest. The interest of the beneficiaries
hereunder shall be divided into an unlimited number of shares of beneficial
interest, par value $.001 per share. All Shares issued in accordance with
the terms hereof, including, without limitation, Shares issued in
connection with a dividend in Shares or a split of Shares, shall be fully
paid and nonassessable when the consideration determined by the Trustees
(if any) therefor shall have been received by the Trust.
5.2 Classes and Series . The Trustees shall have the authority,
without the approval of the holders of any Shares of the Trust, to classify
and reclassify issued and unissued Shares into one or more classes and one
or more series of any or all of such classes, each of which classes and
series thereof shall have such designations, powers, preferences, voting,
conversion and other rights, limitations, qualifications and terms and
conditions as the Trustees shall determine from time to time with respect
to each such class or series; provided, however, that no reclassification
of any issued and outstanding Shares and no modifications of any of the
designations, powers, preferences, voting, conversion or other rights,
limitations, qualifications and terms and conditions of any issued and
outstanding Shares may be made by the Trustees without the affirmative vote
of the holders of Shares specified in Section 7.3(a). The initial class of
Shares of the Trust shall be designated as "Common Shares", subject to
redesignation as aforesaid. To the extent expressly determined by the
Trustees as aforesaid, all consideration received by the Trust for the
issue or sale of Shares of a class, 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 such class subject only to the rights of the
creditors, and all liabilities allocable to such class shall be charged
thereto.
5.3 Issuance of Shares. The Trustees, in their discretion, may
from time to time without vote of the Shareholders issue Shares of any
class or any series of any such class to such party or parties and for such
amount and type of consideration, including cash or property, at such time
or times, and on such terms as the Trustees may determine, and may in such
manner acquire other assets (including the acquisition of assets subject
to, and in connection with the assumption of, liabilities) and businesses.
The Trustees may from time to time divide or combine the Shares of any
class or any series of any such class into a greater or lesser number
without thereby changing the proportionate beneficial interest in such
Shares. Issuances and repurchases of Shares may be made in whole Shares
and/or l/l,000ths of a Share or multiples thereof as the Trustees may
determine.
5.4 Rights of Shareholders. The Shares shall be personal
property giving only the rights in this Declaration specifically set forth.
The ownership of the Trust Property of every description and the right to
conduct any business herein before described are vested exclusively in the
Trustees, and the Shareholders shall have no interest therein other than
the beneficial interest conferred by their Shares, and they shall have no
right to call for any partition or division of any property, profits,
rights or interests of the Trust nor can they be called upon to share or
assume any losses of the Trust or, subject to the right of the Trustees to
charge certain expenses directly to Shareholders, as provided in the last
sentence of Section 3.7, suffer an assessment of any kind by virtue of
their ownership of Shares. The Shares shall not entitle the holder to
preference, preemptive, appraisal, conversion or exchange rights (except as
specified in this Section 5.4, in Section 7.4 or as specified by the
Trustees in the designation or redesignation of any class or series thereof
of the Shares).
5.5 Trust Only. It is the intention of the Trustees to create
only the relationship of Trustee and beneficiary between the Trustees and
each Shareholder from time to time. It is not the intention of the
Trustees to create a general partnership, limited partnership, joint stock
association, corporation, bailment or any form of legal relationship other
than a trust. Nothing in this Declaration shall be construed to make the
Shareholders, either by themselves or with the Trustees, partners or
members of a joint stock association.
5.6 Register of Shares. A register shall be kept at the Trust
or any transfer agent duly appointed by the Trustees under the direction of
the Trustees which shall contain the names and addresses of the
Shareholders and the number of Shares held by them respectively and a
record of all transfers thereof. Separate registers shall be established
and maintained for each class and each series of each class. Each such
register shall be conclusive as to who are the holders of the Shares of the
applicable class and series and who shall be entitled to receive dividends
or distributions or otherwise to exercise or enjoy the rights of
Shareholders. No Shareholder shall be entitled to receive payment of any
dividend or distribution, nor to have notice given to him as herein
provided, until he has given his address to a transfer agent or such other
officer or agent of the Trustees as shall keep the register for entry
thereon. It is not contemplated that certificates will be issued for the
Shares; however, the Trustees, in their discretion, may authorize the
issuance of share certificates and promulgate appropriate fees therefore
and rules and regulations as to their use.
5.7 Transfer Agent and Registrar. The Trustees shall have power
to employ a transfer agent or transfer agents, and a registrar or
registrars, with respect to the Shares. The transfer agent or transfer
agents may keep the applicable register and record therein, the original
issues and transfers, if any, of the said Shares. Any such transfer agent
and registrars shall perform the duties usually performed by transfer
agents and registrars of stock in a corporation, as modified by the
Trustees.
5.8 Transfer of Shares. Shares shall be transferable on the
records of the Trust only by the record holder thereof or by its agent
thereto duly authorized in writing, upon delivery to the Trustees or a
transfer agent of the Trust of a duly executed instrument of transfer,
together with such evidence of the genuineness of each such execution and
authorization and of other matters as may reasonably be required. Upon
such delivery the transfer shall be recorded on the applicable register of
the Trust. Until such record is made, the Shareholder of record shall be
deemed to be the holder of such Shares for all purposes hereof and neither
the Trustees nor any transfer agent or registrar nor any officer, employee
or agent of the Trust shall be affected by any notice of the proposed
transfer.
Any person becoming entitled to any Shares in consequence of the
death, bankruptcy, or incompetence of any Shareholder, or otherwise by
operation of law, shall be recorded on the applicable register of Shares as
the holder of such Shares upon production of the proper evidence thereof to
the Trustees or a transfer agent of the Trust, but until such record is
made, the Shareholder of record shall be deemed to be the holder of such
for all purposes hereof, and neither the Trustees nor any transfer agent or
registrar nor any officer or agent of the Trust shall be affected by any
notice of such death, bankruptcy or incompetence, or other operation of
law.
5.9 Notices. Any and all notices to which any Shareholder
hereunder may be entitled and any and all communications to any Shareholder
shall be deemed duly served or given if mailed, postage prepaid, addressed
to any Shareholder of record at his last known address as recorded on the
applicable register of the Trust and may be sent together with any such
notice or other communication to another Shareholder at the same address.
5.10 Net Asset Value. The value of the assets of the Trust, the
amount of liabilities of the Trust and the net asset value of each
outstanding Share of Common Shares of the Trust shall be determined at such
time or times on such days as the Trustees may determine, in accordance
with the 1940 Act. The method of determination of net asset value shall be
determined by the Trustees. The power and duty to make net asset value
determinations and calculations may be delegated by the Trustees.
5.11 Distributions to Shareholders.
(a) The Trustees shall from time to time distribute among
the Shares such proportion of the net profits, surplus (including paid-in
surplus), capital, or assets held by the Trustees as they may deem proper
or as may otherwise be determined in the instrument setting forth the terms
of such Shares such class or series of Shares, which need not be ratable
with respect to distributions in respect of Shares of any other class or
series thereof of the Trust. Such distributions may be made in cash or
property (including without limitation any type of obligations of the Trust
or any assets thereof) or any combination thereof.
(b) Distributions may be made to the Shareholders entitled
to such distribution of record at the time such distribution is declared or
at such later date as shall be determined by the Trust prior to the date of
payment.
(c) The Trustees may always retain from any source such
amount as they may deem necessary to pay the debts or expenses of the Trust
or to meet obligations of the Trust, or as they otherwise may deem
desirable to use in the conduct of its affairs or to retain for future
requirements or extensions of the business of the Trust.
ARTICLE VI
Shareholders
6.1 Meetings of Shareholders. The Trust may, but shall not be
required to, hold annual meetings of the holders of any class or series of
Shares. An annual or special meeting of Shareholders may be called at any
time only by the Trustees; provided, however, that if May 31 of any year
shall have passed and the Trustees shall not have called an annual meeting
of Shareholders for such year, the Trustees shall call a meeting for the
purpose of voting on the removal of one or more Trustees or the termination
of any investment advisory agreement, upon written request of holders of
Shares of the Trust having in the aggregate not less than a majority of the
votes of the outstanding Shares of the Trust entitled to vote on the matter
or matters in question, such request specifying the purpose or purposes for
which such meeting is to be called. Any meeting of Shareholders shall be
held within or without the State of Delaware on such day and at such time
as the Trustees shall designate.
6.2 Voting. Shareholders shall have no power to vote on any
matter except matters on which a vote of Shares is required by applicable
law, this Declaration or resolution of the Trustees. Any matter required
to be submitted for approval of any of the Shares and affecting one or more
classes or series shall require approval by the required vote of Shares of
the affected class or classes and series voting together as a single class
and, if such matter affects one or more classes or series thereof
differently from one or more other classes or series thereof or from one or
more series of the same class, approval by the required vote of Shares of
such other class or classes or series or series voting as a separate class
shall be required in order to be approved with respect to such other class
or classes or series or series; provided, however, that except to the
extent required by the 1940 Act, there shall be no separate class votes on
the election or removal of Trustees or the selection of auditors for the
Trust. Shareholders of a particular class or series thereof shall not be
entitled to vote on any matter that affects the rights or interests of only
one or more other classes or series of such other class or classes or only
one or more other series of the same class. There shall be no cumulative
voting in the election or removal of Trustees.
6.3 Notice of Meeting, Shareholder Proposals and Record Date.
Notice of all meetings of Shareholders, stating the time, place and
purposes of the meeting, shall be given by the Trustees by mail to each
Shareholder of record entitled to vote thereat at its registered address,
mailed at least 10 days before the meeting or otherwise in compliance with
applicable law. Except with respect to an annual meeting, at which any
business required by the 1940 Act may be conducted, only the business
stated in the notice of the meeting shall be considered at such meeting.
Subject to the provisions of applicable law, any Shareholder wishing to
include a proposal to be considered at an annual meeting must submit such
proposal to the Trust at least 30 days in advance of such meeting. Any
adjourned meeting may be held as adjourned one or more times without
further notice not later than 130 days after the record date. For the
purposes of determining the Shareholders who are entitled to notice of and
to vote at any meeting the Trustees may, without closing the transfer
books, fix a date not more than 100 days prior to the date of such meeting
of Shareholders as a record date for the determination of the Persons to be
treated as Shareholders of record for such purposes.
6.4 Quorum and Required Vote.
(a) The holders of one-third of the outstanding Shares of
the Trust on the record date present in person or by proxy shall constitute
a quorum at any meeting of the Shareholders for purposes of conducting
business on which a vote of all Shareholders of the Trust is being taken.
The holders of one-third of the outstanding Shares of a class or classes on
the record date present in person or by proxy shall constitute a quorum at
any meeting of the Shareholders of such class or classes for purposes of
conducting business on which a vote of Shareholders of such class or
classes is being taken. The holders of one-third of the outstanding Shares
of a series or series on the record date present in person or by proxy
shall constitute a quorum at any meeting of the Shareholders of such series
or series for purposes of conducting business on which a vote of
Shareholders of such series or series is being taken. Shares underlying a
proxy as to which a broker or other intermediary states its absence of
authority to vote with respect to one or more matters shall be treated as
present for purposes of establishing a quorum for taking action on any such
matter only to the extent so determined by the Trustees at or prior to the
meeting of Shareholders at which such matter is to be considered.
(b) Subject to any provision of applicable law, this
Declaration or resolution of the Trustees specifying or requiring a greater
or lesser vote requirement for the transaction of any matter of business at
any meeting of Shareholders, (i) the affirmative vote of a plurality of the
Shares entitled to vote for the election of any Trustee or Trustees shall
be the act of such Shareholders with respect to the election of such
Trustee or Trustees, (ii) the affirmative vote of a majority of the Shares
present in person or represented by proxy and entitled to vote on any other
matter shall be the act of the Shareholders with respect to such matter,
and (iii) where a separate vote of one or more classes or series is
required on any matter, the affirmative vote of a majority of the Shares of
such class or classes or series or series present in person or represented
by proxy at the meeting shall be the act of the Shareholders of such class
or classes or series or series with respect to such matter.
6.5 Proxies, etc. At any meeting of Shareholders, any holder of
Shares entitled to vote thereat may vote by proxy, provided that no proxy
shall be voted at any meeting unless it shall have been placed on file with
the Secretary, or with such other officer or agent of the Trust as the
Secretary may direct, for verification prior to the time at which such vote
shall be taken. Pursuant to a resolution of a majority of the Trustees,
proxies may be solicited in the name of one or more Trustees or one or more
of the officers or employees of the Trust. Only Shareholders of record
shall be entitled to vote. Each full Share shall be entitled to one vote
and each fractional Share shall be entitled to a vote equal to its fraction
of a full Share. When any Share is held jointly by several persons, any
one of them may vote at any meeting in person or by proxy in respect of
such Share, but if more than one of them shall be present at such meeting
in person or by proxy, and such joint owners or their proxies so present
disagree as to any vote to be cast, such vote shall not be received in
respect of such Share. A proxy purporting to be given by or on behalf of a
Shareholder of record on the record date for a meeting shall be deemed
valid unless challenged at or prior to its exercise, and the burden of
proving invalidity shall rest on the challenger. If the holder of any such
Share is a minor or a person of unsound mind, and subject to guardianship
or to the legal control of any other person as regards the charge or
management of such Share, he may vote by his guardian or such other person
appointed or having such control, and such vote may be given in person or
by proxy. The Trustees shall have the authority to make and modify from
time to time regulations regarding the validity of proxies. In addition to
signed proxies, such regulations may authorize facsimile, telephonic,
Internet and other methods of appointing a proxy that are subject to such
supervision by or under the direction of the Trustees as the Trustees shall
determine.
6.6 Reports. The Trustees shall cause to be prepared and sent
to Shareholders at least annually and more frequently to the extent and in
the form required by law, regulation or any exchange on which Trust Shares
are listed a report of operations containing financial statements of the
Trust prepared in conformity with generally accepted accounting principles
and applicable law.
6.7 Inspection of Records. The records of the Trust shall be
open to inspection by Persons who have been holders of record of at least
$25,000 in net asset value or liquidation preference of Shares for a
continuous period of not less than six months to the same extent and for
the same purposes as is permitted under the Delaware General Business
Corporation Law to shareholders of a Delaware business corporation.
6.8 Shareholder Action by Written Consent. Any action which may
be taken by Shareholders by vote may be taken without a meeting if the
holders of all of the Shares entitled to vote thereon consent to the action
in writing and the written consents are filed with the records of the
meetings of Shareholders. Such consent shall be treated for all purposes
as a vote taken at a meeting of Shareholders.
ARTICLE VII
Duration: Termination of Trust;
Amendment; Mergers, Etc.
7.1 Duration. Subject to termination in accordance with the
provisions of Section 7.2 hereof, the Trust created hereby shall have
perpetual existence.
7.2 Termination.
(a) The Trust may be dissolved, after two thirds of the
Trustees have approved a resolution therefor, upon approval by Xxxxxx
having at least 75% of the votes of all of the Shares outstanding on the
record date for such meeting, voting as a single class except to the extent
required by the 1940 Act. Upon the dissolution of the Trust:
(i) The Trust shall carry on no business except
for the purpose of winding up its affairs.
(ii) The Trustees shall proceed to wind up the
affairs of the Trust and all of the powers of the Trustees under
this Declaration shall continue until the affairs of the Trust
shall have been wound up, including the power to fulfill or
discharge the contracts of the Trust, collect its assets, sell,
convey, assign, exchange, merger where the Trust is not the
survivor, transfer or otherwise dispose of all or any part of the
remaining Trust Property to one or more Persons at public or
private sale for consideration which may consist in whole or in
part in cash, securities or other property of any kind, discharge
or pay its liabilities, and do all other acts appropriate to
liquidate its business; provided that any sale, conveyance,
assignment, exchange, merger in which the Trust is not the
survivor, transfer or other disposition of all or substantially
all the Trust Property of the Trust shall require approval of the
principal terms of the transaction and the nature and amount of
the consideration with the same vote as required for dissolution
pursuant to paragraph (a) above.
(iii) After paying or adequately providing for
the payment of all liabilities, and upon receipt of such
releases, indemnities and refunding agreements, as they deem
necessary for their protection, the Trustees may distribute the
remaining Trust Property, in cash or in kind or partly each,
among the Shareholders according to their respective rights.
(b) After the winding up and termination of the Trust and
distribution to the Shareholders as herein provided, a majority of the
Trustees shall execute and lodge among the records of the Trust an
instrument in writing setting forth the fact of such termination and shall
execute and file a certificate of cancellation with the Secretary of State
of the State of Delaware. Upon termination of the Trust, the Trustees
shall thereupon be discharged from all further liabilities and duties
hereunder, and the rights and interests of all Shareholders shall thereupon
cease.
7.3 Amendment Procedure.
(a) Other than Sections 2.2, 2.3, 6.1, 6.8, 7.2, 7.3, 7.4,
7.5 and 7.6 and other than as set forth in the last sentence of this
Section 7.3(a), this Declaration may be amended, after a majority of the
Trustees have approved a resolution therefor, by the affirmative vote of
the holders of not less than a majority of the affected Shares outstanding
on the record date and present and voting on such amendment. Sections 2.2,
2.3, 6.1, 7.2, 7.3, 7.4, 7.5 and 7.6 may be amended, after a majority of
the Trustees have approved a resolution therefor by the affirmative vote of
the holders of not less than 75% of the affected Shares outstanding on the
record date. The Trustees also may amend this Declaration without any vote
of Shareholders for any of the purposes set forth in Section 6.2, to change
the name of the Trust or any class or series, to make any change that does
not adversely affect the relative rights or preferences of any class or
series of Shares or to conform this Declaration to the requirements of the
1940 Act or any other applicable law, but the Trustees shall not be liable
for failing to do so.
(b) Nothing contained in this Declaration shall permit the
amendment of this Declaration to impair the exemption from personal
liability of the Shareholders, Trustees, officers, employees and agents of
the Trust or to permit assessments upon Shareholders.
(c) An amendment duly adopted by the requisite vote of the
Board of Trustees and, if required, Shareholders as aforesaid, shall become
effective at the time of such adoption or at such other time as may be
designated by the Board of Trustees or Shareholders, as the case may be. A
certification signed by a majority of the Trustees setting forth an
amendment and reciting that it was duly adopted by the Trustees and, if
required, Shareholders as aforesaid, or a copy of the Declaration, as
amended, and executed by a majority of the Trustees, shall be conclusive
evidence of such amendment when lodged among the records of the Trust or at
such other time designated by the Board.
Notwithstanding any other provision hereof, until such time as
Shares are issued and outstanding, this Declaration may be terminated or
amended in any respect by the affirmative vote of a majority of the
Trustees or by an instrument signed by a majority of the Trustees.
7.4 Merger, Consolidation and Sale of Assets. Subject to
Section 7.6, 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 or the property, including its
good will, upon such terms and conditions and for such consideration when
and as authorized by two-thirds of the Trustees and approved by the
affirmative vote of the holders of not less than 75% of the affected Shares
outstanding on the record date for the meeting of Shareholders to approve
such transaction, and any such merger, consolidation, sale, lease or
exchange shall be determined for all purposes to have been accomplished
under and pursuant to the statutes of the State of Delaware.
7.5 Redemption; Conversion. No holder of Shares of any class or
series, other than in accordance with the provisions of Section 23(c) of
the 1940 Act and other than to the extent expressly determined by the
Trustees with respect to Shares qualifying as preferred stock pursuant to
Section 18(a) of the 1940 Act, shall have any right to require the Trust or
any person controlled by the Trust to purchase any of such holder's Shares.
The Trust may be converted at any time from a "closed-end company" to an
"open-end company" as those terms are defined by the 1940 Act, upon the
approval of such a proposal, together with the necessary amendments to this
Declaration to permit such a conversion, by a majority of the Trustees then
in office, by the holders of not less than 75% of the Trust's outstanding
Shares entitled to vote thereon and by such vote or votes of the holders of
any class or classes or series of Shares as may be required by the 1940
Act. From time to time, the Trustees may consider recommending to the
Shareholders a proposal to convert the Trust from a "closed-end company" to
an "open-end company." Upon the recommendation and subsequent adoption of
such a proposal and the necessary amendments to this Declaration to permit
such a conversion of the Trust's outstanding Shares entitled to vote, the
Trust shall, upon complying with any requirements of the 1940 Act and state
law, become an "open-end" investment company.
7.6 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 eighty percent (80%) of the Shares of each class
outstanding and entitled to vote, voting as a class, 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 Shares otherwise required by law or by
the terms of any class or series of preferred stock, whether now or
hereafter authorized, or any agreement between the Trust and any national
securities exchange.
(b) The term "Principal Shareholder" shall mean any Person which is
the beneficial owner, directly or indirectly, of five percent (5%) or more
of the outstanding Shares and shall include any affiliate or associate, as
such terms are defined in clause (ii) below, of such Person. For the
purposes of this Section, in addition to the Shares which a Person
beneficially owns directly, (a) any Person 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
Person with which 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 of the General Rules
and Regulations under the Securities Exchange Act of 1934 as in effect on
the date of initial adoption of this Declaration, 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:
(i) The merger or consolidation of the Trust or any subsidiary
of the Trust with or into any Principal Shareholder.
(ii) The issuance of any securities of the Trust to any
Principal Shareholder for cash (other than pursuant to any automatic
dividend reinvestment plan or any offering in which such Principal
Shareholder acquires securities that do not increase the percentage of any
class of Shares beneficially owned by such Principal Shareholder).
(iii) 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.)
(iv) 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).
(v) The purchase by the Trust or any Person controlled by the
Trust of any Common Shares of the Trust from such Principal Shareholder or
any person to whom such Principal Shareholder shall have transferred such
Common Shares.
(d) The provisions of this Section shall not be applicable to (i) any
of the transactions described in paragraph (c) of this Section if two-
thirds of the Board of Trustees of the Trust shall by resolution have
approved a memorandum of understanding with such Principal Shareholder with
respect to and substantially consistent with such transaction prior to the
time such Person shall have become a Principal Shareholder, or (ii) any
such transaction with any corporation of which a majority of the
outstanding shares of all classes of a stock normally entitled to vote in
elections of directors is owned of record or beneficially by the Trust and
its subsidiaries and of which such Person is not a Principal Shareholder.
(e) The Board of 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 Person beneficially owns five percent (5%) or more of
the outstanding Shares, (ii) a Person 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.
ARTICLE VIII
Miscellaneous
8.1 Filing. This Declaration and any amendment (including any
supplement) hereto shall be filed in such places as may be required or as
the Trustees deem appropriate. Each amendment shall be accompanied by a
certificate signed and acknowledged by a Trustee stating that such action
was duly taken in a manner provided herein, and shall, upon insertion in
the Trust's minute book, be conclusive evidence of all amendments contained
therein. A restated Declaration, containing the original Declaration and
all amendments theretofore made, may be executed from time to time by a
majority of the Trustees and shall, upon insertion in the Trust's minute
book, 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.
8.2 Resident Agent. The Trust shall maintain a resident agent
in the State of Delaware, which agent shall initially be The Corporation
Trust Company, 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000 The Trustees
may designate a successor resident agent, provided, however, that such
appointment shall not become effective until written notice thereof is
delivered to the office of the Secretary of the State.
8.3 Governing Law. This Declaration is executed by a majority
of the Trustees and delivered in the State of Delaware and with reference
to the laws thereof, and the rights of all parties and the validity and
construction of every provision hereof shall be subject to and construed
according to the laws of said State and reference shall be specifically
made to the business corporation law of the State of Delaware as to the
construction of matters not specifically covered herein or as to which an
ambiguity exists, although such law shall not be viewed as limiting the
powers otherwise granted to the Trustees hereunder and any ambiguity shall
be viewed in favor of such powers.
8.4 Counterparts. This Declaration may be simultaneously
executed in several counterparts, each of which shall be deemed to be an
original, and such counterparts, together, shall constitute one and the
same instrument, which shall be sufficiently evidenced by any such original
counterpart.
8.5 Reliance by Third Parties. Any certificate executed by an
individual who, according to the records of the Trust, or of any recording
office in which this Declaration may be recorded, appears to be a Trustee
hereunder, certifying to: (a) the number or identity of Trustees or
Shareholders, (b) the name of the Trust, (c) the due authorization of the
execution of any instrument or writing, (d) the form of any vote passed at
a meeting of Trustees or Shareholders, (e) the fact that the number of
Trustees or Shareholders present at any meeting or executing any written
instrument satisfies the requirements of this Declaration, (f) the form of
any By Laws adopted by or the identity of any officers elected by the
Trustees, or (g) the existence of any fact or facts which in any manner
relate to the affairs of the Trust, shall be conclusive evidence as to the
matters so certified in favor of any person dealing with the Trustees and
their successors.
8.6 Provisions in Conflict with Law or Regulation.
(a) The provisions of this Declaration are severable, and
if the Trustees shall determine, with the advice of counsel, that any of
such provisions is in conflict with the 1940 Act, the regulated investment
company provisions of the Internal Revenue Code or with other applicable
laws and regulations, the conflicting provision shall be deemed never to
have constituted a part of this Declaration; provided, however, that such
determination shall not affect any of the remaining provisions of this
Declaration or render invalid or improper any action taken or omitted prior
to such determination.
(b) If any provision of this Declaration shall be held
invalid or unenforceable in any jurisdiction, such invalidity or
unenforceability shall attach only to such provision in such jurisdiction
and shall not in any manner affect such provision in any other jurisdiction
or any other provision of this Declaration in any jurisdiction.
IN WITNESS WHEREOF, the undersigned has caused these presents to
be executed as of the day and year first above written.
By: /s/ Xxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx
