ADVANTAGE ADVISERS MULTI-SECTOR FUND I
(A Delaware Business Trust)
SECOND AMENDED AND RESTATED
AGREEMENT AND DECLARATION OF TRUST
Dated as of March 26, 2002
ADVANTAGE ADVISERS MULTI-SECTOR FUND I
SECOND AMENDED AND RESTATED AGREEMENT AND DECLARATION OF TRUST
SECOND AMENDED AND RESTATED AGREEMENT AND DECLARATION OF TRUST
made as of the 26th day of March 2002, by the Trustees hereunder, and by
the holders of Shares 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 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 August 14, 2001 shall constitute a business
trust under the Delaware Business Trust Act 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 "Advantage Advisers
Multi-Sector Fund I" 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:
"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.
"Advisers Act" refers to the Investment Advisers Act of 1940 and
the rules and regulations promulgated thereunder and exemptions granted
therefrom, as amended from time to time.
The term "Interested Person" shall have the meaning given to it in
the 1940 Act.
"By-Laws" shall mean the By-Laws of the Trust, as amended from
time to time by the Trustees.
"Chairman" refers to the Chairman of the Board of Trustees, if
any.
"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 Amended and Restated Agreement and
Declaration of Trust, as amended or amended and restated from time to time.
"Delaware Business Trust Act" shall mean the provisions of the
Delaware Business Trust Act, 12 Del. C.ss.3801, et. seq., as such Act may
be amended from time to time.
"Delaware General Corporation Law" means the Delaware General
Corporation Law, 8 Del. C.ss.100, et. seq., as amended from time to time.
"Exchange Act" refers to the Securities Exchange Act of 1934 and
the rules and regulations promulgated thereunder and exemptions granted
therefrom, as 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
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 0000
Xxx) of the Trust with each class voting together (except where the classes
are required to vote separately by the 1940 Act or other applicable law).
"Person" shall mean and include individuals, 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 Prospectus of the Trust, if any, as in
effect from time to time under the Securities Act of 1933, as amended.
"Securities Act" refers to the Securities Act of 1933 and the
rules and regulations promulgated thereunder and exemptions granted
therefrom, as amended from time to time.
"Shareholders" shall mean, as of any particular time, the holders
of record of outstanding Shares 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 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.
"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.
"Trustees" shall mean the signatories to this Declaration so long
as they 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.
ARTICLE II
Trustees
2.1 Number and Qualification. Prior to a public offering of
Shares, there may be a sole Trustee. Thereafter, the number of Trustees
shall be determined by a written instrument signed by a majority of the
Trustees then in office; provided that the number of Trustees shall be no
less than two or more than nine. 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 80 years of age at the time of
nomination and not under legal disability. Trustees need not own Shares and
may succeed themselves in office.
2.2 Term and Election. The number of the Trustees shall be
determined by resolution of the Board of Trustees. The term of office of
all of the Trustees shall expire on the date of the first annual or special
meeting of Shareholders following the effective date of the Registration
Statement relating to the Shares under the Securities Act of 1933, as
amended; thereafter, the term of office of all of the Trustees shall expire
on the date of each successive annual meeting or special meeting in lieu
thereof called for the purpose of electing all Trustees. Except as provided
in Sections 2.3 or 2.4, the Trustees shall be elected at an annual meeting
of the Shareholders or special meeting in lieu thereof called for the
purpose, and each Trustee elected shall hold office until his or her
successor shall have been elected and shall have qualified.
2.3 Resignation and Removal. Any of the Trustees may resign their
trust (without need for prior or subsequent accounting) by an instrument in
writing signed by such Trustee and delivered or mailed to the Trustees or
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 of the Trustees 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) for cause only, and not
without cause, and only by action taken by a majority of the remaining
Trustees followed by consent of the holders of at least seventy-five
percent (75%) of the Shares then entitled to vote in an election of such
Trustee. Upon the resignation or removal of a Trustee, each such resigning
or removed Trustee 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 such
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 II by a written instrument signed 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 that 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 II 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, or the President 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 given by the Secretary and
shall be delivered to the Trustees orally not less than 24 hours, or in
writing not less than 72 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 properly called or convened. A quorum for all meetings of the
Trustees shall be not less than two. Unless provided otherwise in this
Declaration and except as required under the 1940 Act, 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.
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 one-third, but not less than two, 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 as set forth
in Section 2.6.
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 for all purposes of the Trust, except to
the extent that participation in such a meeting would not satisfy any
requirement under the 1940 Act with respect to any matter that requires the
in personam approval of the Trustees.
2.6 Trustee Action by Written Consent. Unless provided otherwise
in this Declaration and except as required under the 1940 Act, any action
which may be taken by Trustees by vote may be authorized or taken without a
meeting if the Trustees, or members of a committee, as the case may be,
having not less than the minimum number of votes that would be necessary to
authorize or take such action at a meeting at which all Trustees, or
members of a committee, as the case may be, entitled to vote thereon were
present and voted, consent to the action in writing and the written
consents are filed with the records of the meetings of Trustees. Such
consent shall be treated for all purposes as a vote taken at a meeting of
Trustees.
2.7 Officers. The Trustees shall elect a President, Secretary,
Vice President, Treasurer and one or more Assistant Secretaries and may
elect a Chairman who shall each 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 powers as the Trustees may deem to be
advisable. A Chairman shall, and the President, Secretary, Vice President,
Treasurer and any Assistant Secretary 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 Delaware General
Corporation Law. 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 may perform such acts as they,
in their sole discretion, determine to be proper for conducting the
business of the Trust. The enumeration of any specific power herein shall
not be construed as limiting the aforesaid power. Such powers of the
Trustees may be exercised without order of or resort to any court.
3.2 Investments. The Trustees shall have power, subject to the
Fundamental Policies in effect from time to time with respect to the Trust
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. 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, subject to the more
detailed provisions set forth in Articles VIII and IX, 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 corporations formed under the Delaware
General Corporation Law.
3.5 Borrow Money or Utilize Leverage. Subject to the Fundamental
Policies in effect from time to time with respect to the Trust, the
Trustees shall have the power to borrow money or otherwise obtain credit or
utilize leverage to the maximum extent permitted by law or regulation as
such may be needed from time to time 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 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 corporations formed under the Delaware General Corporation Law
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.
3.7 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 corporation formed under the Delaware
General Corporation Law, 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.
3.8 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 incidental 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.
3.9 By-Laws. The Trustees shall have the exclusive authority to
adopt and from time to time amend or repeal By-Laws for the conduct of the
business of the Trust.
3.10 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; (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
advisers, 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 law, indemnify
any Person with whom the Trust has dealings, including without limitation
any adviser, administrator, manager, transfer agent, custodian, distributor
or selling agent, 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.
3.11 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. The
Trustees will not be required to obtain any court order to deal with the
Trust Property.
ARTICLE IV
Advisory, Management and Distribution Arrangements
4.1 Advisory and Management Arrangements. Subject to the
requirements of applicable law as in effect from time to time, the Trustees
may in their discretion from time to time enter into advisory,
administration or management contracts (including, in each case, one or
more sub-advisory, sub-administration or sub-management contracts) whereby
the other party to any such contract shall undertake to furnish the
Trustees such advisory, administrative and management services, with
respect to the Trust as the Trustees shall from time to time consider
desirable and all upon such terms and conditions as the Trustees may in
their discretion determine. Notwithstanding any provisions of this
Declaration, the Trustees may authorize any adviser, administrator or
manager (subject to such general or specific instructions as the Trustees
may from time to time adopt) to effect investment transactions with respect
to the assets on behalf of the Trustees to the full extent of the power of
the Trustees to effect such transactions or may authorize any officer,
employee or Trustee to effect such transactions pursuant to recommendations
of any such adviser, administrator or manager (and all without further
action by the Trustees). Any such investment transaction shall be deemed to
have been authorized by all of the Trustees.
4.2 Distribution Arrangements. Subject to compliance with the 1940
Act, the Trustees may retain distributors and/or selling agents to sell
Shares. The Trustees may in their discretion from time to time enter into
one or more contracts, providing for the sale of the Shares, whereby the
Trust may either agree to sell such Shares to the other party to the
contract or appoint such other party its distributor or selling agent for
such Shares. In either case, the contract shall be on such terms and
conditions as the Trustees may in their discretion determine not
inconsistent with the provisions of this Article IV, the By-Laws or the
1940 Act; and such contract may also provide for the repurchase or sale of
Shares by such other party as principal or as agent of the Trust and may
provide that such other party may enter into selling and servicing (and
similar) agreements with registered securities dealers and brokers (or with
persons who are not registered securities dealers but are otherwise
authorized to distribute or repurchase Shares) to further the purposes of
the distribution or repurchase of the Shares of the Trust.
4.3 Parties to Contract. Any contract of the character described
in Sections 4.1 and 4.2 of this Article IV or in Article VII hereof may be
entered into with any Person, although one or more of the Trustees,
officers or employees of the Trust may be an officer, director, trustee,
shareholder, or member of such other party to the contract, and no such
contract shall be invalidated or rendered voidable by reason of the
existence of any such relationship, nor shall any Person holding such
relationship be liable merely by reason of such relationship for any loss
or expense to the Trust under or by reason of said contract or accountable
for any profit realized directly or indirectly therefrom; provided that the
contract when entered into was reasonable and fair and not inconsistent
with the provisions of this Article IV or the By-Laws. The same Person may
be the other party to contracts entered into pursuant to Sections 4.1 and
4.2 above or Article VII, and any individual may be financially interested
or otherwise affiliated with Persons who are parties to any or all of the
contracts mentioned in this Section 4.3.
ARTICLE V
Limitations of Liability and Indemnification
5.1 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 Delaware General
Corporation Law. 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
(negligence in the case of those Trustees or officers who are directors,
officers or employees of the Trust's investment adviser ("Affiliated
Indemnitees")) 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. Any repeal or
modification of this Section 5.1 shall not adversely affect any right or
protection of a Trustee or officer of the Trust existing at the time of
such repeal or modification with respect to acts or omissions occurring
prior to such repeal or modification.
5.2 Mandatory Indemnification.
(a) The Trust hereby agrees to indemnify each person who at any
time serves as a Trustee or officer 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 or with which he may be or may have been threatened,
while acting in any capacity set forth in this Article V 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, 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
(1) was authorized by a majority of the Trustees or (2) was instituted by
the Indemnitee to enforce his or her rights to indemnification hereunder in
a case in which the Indemnitee is found to be entitled to such
indemnification. The rights to indemnification set forth in this
Declaration shall continue as to a person who has ceased to be a Trustee or
officer of the Trust and shall inure to the benefit of his or her heirs,
executors and personal and legal representatives. No amendment or
restatement of this Declaration or repeal of any of its provisions shall
limit or eliminate any of the benefits provided to any person who at any
time is or was a Trustee or officer of the Trust or otherwise entitled to
indemnification hereunder in respect of any act or omission that occurred
prior to such amendment, restatement or repeal.
(b) Notwithstanding the foregoing, no indemnification shall be
made hereunder unless there has been a determination (i) 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,
(ii) in the absence of such a decision, by (1) 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 (2) if such quorum
is not obtainable or even if obtainable, if such majority so directs,
independent legal counsel in a written opinion concludes 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 the Indemnitee 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: (i) the Indemnitee shall
provide adequate security for his undertaking, (ii) the Trust shall be
insured against losses arising by reason of any lawful advances, or (iii) a
majority of a quorum of the Disinterested 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 which any person may have or hereafter
acquire under this Declaration, the By-Laws of the Trust, any statute,
agreement, vote of stockholders or persons that are not Interested Persons
or any other right to which he or she may be lawfully entitled.
(e) Subject to any limitations provided by the 1940 Act and this
Declaration, the Trust shall have the power and authority to indemnify and
provide for the advance payment of expenses to employees, agents and other
Persons providing services to the Trust or serving in any capacity at the
request of the Trust to the full extent corporations organized under the
Delaware General Corporation Law may indemnify or provide for the advance
payment of expenses for such Persons; provided that such indemnification
has been approved by a majority of the Trustees.
5.3 No Bond Required of Trustees. No Trustee shall, as such, be
obligated to give any bond or other security for the performance of any of
his duties hereunder.
5.4 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. Every written obligation, contract, undertaking, instrument,
certificate, Share, other security of the Trust made or issued by the
Trustees or by any officers, employees or agents of the Trust in their
capacity as such, shall contain an appropriate recital to the effect that
the Shareholders, Trustees, officers, employees or agents of the Trust
shall not personally be bound by or liable thereunder, nor shall resort be
had to their private property for the satisfaction of any obligation or
claim thereunder, and appropriate references shall be made therein to this
Declaration, and may contain any further recital which they may deem
appropriate, but the omission of such recital shall not operate to impose
personal liability on any of the Trustees, Shareholders, officers,
employees or agents of the Trust. The Trustees may maintain insurance,
including a fidelity bond, 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 tort liability, and such
other insurance as the Trustees in their sole judgment shall deem advisable
or is required by the 1940 Act.
5.5 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 expert may also be a Trustee.
5.6 Indemnification of Shareholders. If any Shareholder or former
Shareholder shall be held personally liable solely by reason of its being
or having been a Shareholder and not because of its acts or omissions or
for some other reason, the Shareholder or former Shareholder (or its heirs,
executors, administrators or other legal representatives or in the case of
any entity, its general successor) shall be entitled out of the assets
belonging to the Trust to be held harmless from and indemnified to the
maximum extent permitted by law against all loss and expense arising from
such liability. The Trust shall, upon request by such Shareholder, assume
the defense of any claim made against such Shareholder for any act or
obligation of the Trust and satisfy any judgment thereon from the assets of
the Trust.
ARTICLE VI
Shares of Beneficial Interest
6.1 Beneficial Interest. The interest of the beneficiaries
hereunder shall be divided into an unlimited number of transferable 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.
6.2 Other Securities. The Trustees may authorize and issue such
other securities as they determine to be necessary, desirable or
appropriate, including additional classes of Shares, preferred interests,
debt securities or other senior securities subject to the Fundamental
Policies and the requirements of the 1940 Act. To the extent that the
Trustees authorize and issue other securities, they are hereby authorized
and empowered to amend or supplement this Declaration as is necessary or
appropriate to comply with the requirements of the 1940 Act relating to
such securities or as required to issue such securities, all without the
approval of Shareholders. Any such supplement or amendment shall be filed
as is necessary. The Trustees are also authorized to take such actions and
retain such persons as they see fit to offer and sell such securities.
6.3 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 suffer an assessment of any kind by
virtue of their ownership of Shares. Shares shall not entitle the holder
thereof to preference, preemptive, appraisal, conversion or exchange rights
(except as specified in this Section 6.3, in Section 11.4 or as specified
by the Trustees when creating the Shares).
6.4 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, limited liability
company, 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.
6.5 Issuance of Shares. The Trustees, in their discretion, may
from time to time without vote of the Shareholders issue Shares, including
multiple classes of Shares, in addition to the then issued and outstanding
Shares and Shares held in the treasury, 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
into a greater or lesser number without thereby changing the proportionate
beneficial interest in such Shares. Issuances and redemptions of Shares may
be made in whole Shares and/or, as the Trustees may determine, in such
fractions thereof.
6.6 Register of Shares. A register shall be kept at the offices of
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. Each such register shall be conclusive as to
who are the holders of the Shares of the applicable class 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; provided, however, that 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.
6.7 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 agents and/or
registrars shall perform the duties usually performed by transfer agents
and registrars of certificates of stock in a corporation, as modified by
the Trustees.
6.8 Transfer of Shares.
(a) Subject to clause (b) of this Section 6.8, 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. Subject to clause (b) of this Section 6.8, 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.
Subject to clause (b) of this Section 6.8, any purported
transferee of Shares as a result 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 (including evidence satisfying
subclauses (i) and (ii) of clause (b) of this Section 6.8) 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.
(b) Shares and any interest therein shall be subject to
restrictions on transfer as set forth herein.
(i) Shares and any interest therein may be held only
through a broker or dealer that has entered into an agreement for
the provision of shareholder services to the Trust;
(ii) Shares and any interest therein may not be
transferred, except to any person or entity who meets the standard
as a "qualified client" within the meaning of paragraph
(d)(1)(ii)(A) of Rule 205-3 under the Advisers Act.
Any transfer of Shares or any interest therein that, if effective, would
not comply with this Section 6.8(b) shall be void to the fullest extent
permitted by law and the purported transferee shall acquire no rights in
such Shares. In addition, the Trustees shall have the right, but shall not
be required, to repurchase such Shares from such purported transferee in
accordance with Section 8.2 hereof.
6.9 Notices. Any and all notices to which any Shareholder
hereunder may be entitled and any and all communications shall be deemed
duly served or given if mailed, postage prepaid, addressed to any
Shareholder of record at his last known address as recorded on the
applicable register of the Trust.
ARTICLE VII
Custodians
7.1 Appointment and Duties. The Trustees shall at all times employ
a custodian or custodians, meeting the qualifications for custodians for
portfolio securities of investment companies contained in the 1940 Act, as
custodian with respect to the assets of the Trust. Any custodian shall have
authority as agent of the Trust with respect to which it is acting as
determined by the custodian agreement or agreements, but subject to such
restrictions, limitations and other requirements, if any, as may be
contained in the By-Laws of the Trust and the 1940 Act:
(a) to hold the securities owned by the Trust and deliver
the same upon written order;
(b) to receive any receipt for any moneys due to the
Trust and deposit the same in its own banking department (if a
bank) or elsewhere as the Trustees may direct;
(c) to disburse such funds upon orders or vouchers;
(d) if authorized by the Trustees, to keep the books and
accounts of the Trust and furnish clerical and accounting
services; and
(e) if authorized to do so by the Trustees, to compute
the net income or net asset value of the Trust;
all upon such basis of compensation as may be agreed upon between the
Trustees and the custodian.
The Trustees may also authorize each custodian to employ one or
more sub-custodians from time to time to perform such of the acts and
services of the custodian and upon such terms and conditions, as may be
agreed upon between the custodian and such sub-custodian and approved by
the Trustees; provided that in every case such sub-custodian shall meet the
qualifications for custodians contained in the 1940 Act.
7.2 Central Certificate System. Subject to such rules, regulations
and orders as the Commission may adopt, the Trustees may direct the
custodian to deposit all or any part of the securities owned by the Trust
in a system for the central handling of securities established by a
national securities exchange or a national securities association
registered with the Commission under the Exchange Act or such other Person
as may be permitted by the Commission, or otherwise in accordance with the
1940 Act, pursuant to which system all securities of any particular class
of any issuer deposited within the system are treated as fungible and may
be transferred or pledged by bookkeeping entry without physical delivery of
such securities; provided that all such deposits shall be subject to
withdrawal only upon the order of the Trust.
ARTICLE VIII
Redemptions; Repurchases, etc.
8.1 Redemptions. The Shares of the Trust are not redeemable by the
Shareholders.
8.2 Repurchases. Subject to the requirements of the 1940 Act, the
Trustees are empowered to authorize the repurchase by the Trust from time
to time of all or any portion of the Shares, whether now or hereafter
authorized, or securities convertible into Shares of any class or classes,
whether now or hereafter authorized, upon such time, at such prices (which
may be determined by formula) and subject to such conditions (which may
include prorating shares tendered for repurchase) as the Trustees may
determine.
8.3 Disclosure of Holding. The holders of Shares or other
securities of the Trust shall, upon demand, disclose to the Trustees in
writing such information with respect to direct and indirect ownership of
Shares or other securities of the Trust as the Trustees deem necessary to
comply with the provisions of the Code, the 1940 Act or other applicable
laws or regulations, or to comply with the requirements of any other taxing
or regulatory authority.
ARTICLE IX
Determination of Net Asset Value, Net Income and Distributions
9.1 Net Asset Value. The net asset value of each outstanding Share
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 and
shall be as set forth in the Prospectus or as may otherwise be determined
by the Trustees. The power and duty to make the net asset value
calculations may be delegated by the Trustees and shall be as generally set
forth in the Prospectus or as may otherwise be determined by the Trustees.
9.2 Distributions to Shareholders.
(a) The Trustees shall from time to time distribute ratably
among the Shareholders such proportion of the net profits, surplus
(including paid-in surplus), capital or assets held by the Trustees as they
may deem proper. Such distribution 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, and the Trustees may distribute
ratably among the Shareholders additional Shares in such manner, at such
times, and on such terms as the Trustees may deem proper.
(b) In the event the Trust has outstanding more than one class
of Shares, the Trustees shall from time to time distribute ratably among
each class of Shareholders of the Trust such proportion of the net profits,
surplus (including paid-in surplus), capital or assets attributable to such
class held by the Trustees as they may deem proper or as may otherwise be
determined in the instrument creating such class of Shares, and the
Trustees may distribute ratably among the Shareholders of each class of the
Trust additional Shares of such class in such manner, at such times, and on
such terms as the Trustees may deem proper. Such distributions to one class
need not be ratable with respect to distributions to Shares of any other
class of the Trust.
(c) Distributions pursuant to this Section 9.2 may be among the
Shareholders of record at the time of declaring a distribution or among the
Shareholders of record at such later date as the Trustees shall determine
and specify at the time of declaration.
(d) The Trustees may always retain from the net profits 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.
(e) Inasmuch as the computation of net income and gains for
federal income tax purposes may vary from the computation thereof on the
books, the above provisions shall be interpreted to give the Trustees the
power in their discretion to distribute for any fiscal year as ordinary
dividends and as capital gains distributions, respectively, additional
amounts sufficient to enable the Trust to avoid or reduce liability for
taxes.
9.3 Power to Modify Foregoing Procedures. Notwithstanding any of
the foregoing provisions of this Article IX, the Trustees may prescribe, in
their absolute discretion except as may be required by the 1940 Act, such
other bases and times for determining the per share asset value of the
Trust's Shares or net income, or the declaration and payment of dividends
and distributions as they may deem necessary or desirable for any reason,
including to enable the Trust to comply with any provision of the 1940 Act,
or the Exchange Act, or any order of exemption issued by the Commission,
all as in effect now or hereafter amended or modified.
ARTICLE X
Shareholders
10.1 Meetings of Shareholders. The Trust shall not hold annual
meetings of the Shareholders. A special meeting of Shareholders may be
called at any time by a majority of the Trustees or the President and shall
be called by any Trustee for any proper purpose upon written request of
Shareholders of the Trust holding in the aggregate not less than 51% of the
outstanding Shares of the Trust or class having voting rights, such request
specifying the purpose or purposes for which such meeting is to be called.
Any Shareholder meeting shall be held within or without the State of
Delaware on such day and at such time as the Trustees shall designate.
10.2 Voting. Shareholders shall have no power to vote on any
matter except matters on which a vote of Shareholders is required by the
1940 Act, other applicable law, this Declaration or resolution of the
Trustees. Except as otherwise provided herein, any matter required to be
submitted to Shareholders and affecting one or more classes shall require
approval by the required vote of all the affected classes of Shares voting
together as a single class; provided, however, that as to any matter with
respect to which a separate vote of any class is required by the 1940 Act,
such requirement as to a separate vote by that class shall apply in lieu of
a vote of all the affected classes voting together as a single class.
Shareholders of a particular class shall not be entitled to vote on any
matter that affects only one or more other classes. There shall be no
cumulative voting in the election or removal of Trustees. The Trustees
shall cause each matter required or permitted to be voted upon at a meeting
or by written consent of Shareholders to be submitted to a vote of all
classes of outstanding Shares entitled to vote thereon, unless the 1940
Act, other applicable law or this Declaration requires that the actions of
the Shareholders be taken by a separate vote of one or more classes, or the
Trustees determine that any matter to be submitted to a vote of
Shareholders affects only the rights or interests of one or more (but not
all) classes of outstanding Shares, in which case only the Shareholders of
the class or classes so affected shall be entitled to vote thereon.
10.3 Notice of Meeting 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 and not
more than 90 days before the meeting or otherwise in compliance with
applicable law. Only the business stated in the notice of the meeting shall
be considered at such meeting. Any adjourned meeting may be held as
adjourned one or more times without further notice not later than 120 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 90 nor less
than 10 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.
10.4 Quorum and Required Vote.
(a) The holders of a majority of the Shares entitled to vote at
the meeting 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 Shareholders of the Trust is being taken. The holders of a majority
of the Shares of a class entitled to vote at the meeting present in person
or by proxy shall constitute a quorum at any meeting of the Shareholders of
such class for purposes of conducting business on which a vote of
Shareholders of such class is being taken. The absence from any meeting, in
person or by proxy, of a quorum of Shareholders for action upon any given
matter shall not prevent action at such meeting upon any other matter or
matters which may properly come before the meeting, if there shall be
present thereat, in person or by proxy, a quorum of Shareholders in respect
of such other matter.
(b) Subject to any provision of the 1940 Act or other applicable
law requiring greater or lesser votes, this Declaration or resolution of
the Trustees specifying a greater or lesser vote requirement for the
transaction of any item of business at any meeting of Shareholders, (i) the
affirmative vote of a majority of the Shares present in person or
represented by proxy and entitled to vote on the subject matter shall be
the act of the Shareholders with respect to such matter, and (ii) where a
separate vote of any class is required on any matter, the affirmative vote
of a majority of the Shares of such class present in person or represented
by proxy at the meeting shall be the act of the Shareholders of such class
with respect to such matter. In the event of any conflict between the 1940
Act and this Declaration with respect to any vote requirement for the
transaction of any item of business at any meeting of Shareholders, the
Trustees are authorized to specify the vote requirement of the 1940 Act for
the transaction of such item of business.
10.5 Proxies, etc. At any meeting of Shareholders, any holder of
Shares entitled to vote thereat may vote by properly executed 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.
Each full Share shall be entitled to one vote and fractional Shares shall
be entitled to a vote of such fraction. 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
executed by or on behalf of a Shareholder shall be deemed valid unless
challenged at or prior to its exercise, and the burden of proving
invalidity shall rest on the challenger. 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.
10.6 Reports. The Trustees shall cause to be prepared at least
annually, and more frequently to the extent and in the form required by law
or regulation, a report of operations containing a statement of assets and
liabilities or balance sheet, a statement of income and undistributed
income of the Trust and a statement of changes in net assets, in each case,
prepared in conformity with generally accepted accounting principles and an
opinion of an independent public accountant on such financial statements.
Copies of such reports shall be mailed to all Shareholders of record within
the time required by the 1940 Act. The Trustees shall, in addition, furnish
to the Shareholders at least semi-annually to the extent required by law,
interim reports containing an unaudited statement of assets and liabilities
or balance sheet of the Trust as of the end of such period and an unaudited
statement of income and surplus and a statement of changes in net assets,
in each case, for the period from the beginning of the current fiscal year
to the end of such period.
10.7 Inspection of Records. The records of the Trust shall be open
to inspection by Shareholders to the same extent as is permitted
shareholders of a corporation formed under the Delaware General Corporation
Law.
10.8 Shareholder Action by Written Consent. Any action which may
be taken by Shareholders by vote may be taken without a meeting if the
holders entitled to vote thereon of the proportion of Shares required for
approval of such action at a meeting of Shareholders pursuant to Section
10.4 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 XI
Duration; Termination of Trust; Amendment; Mergers, Etc.
11.1 Duration. Subject to possible termination in accordance with
the provisions of Section 11.2 hereof, the Trust created hereby shall have
perpetual existence.
11.2 Termination.
(a) the Trust may be dissolved, after a majority of the Trustees
have approved a resolution therefor, upon approval by not less than 75% of
the Shares outstanding and entitled to vote, voting as a single class,
unless such resolution has been approved by 80% of the Trustees, in which
case approval by a Majority Shareholder Vote shall be required. 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, merge 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 by Shareholders with the same vote as required
to open-end the Trust; and
(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.
11.3 Amendment Procedure.
(a) Except as provided in subsection (b) of this Section 11.3,
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. The Trustees also may
amend this Declaration without any vote of Shareholders to divide the
Shares of the Trust into one or more classes or additional classes, to
change the name of the Trust or any class, to make any change that does not
adversely affect the relative rights or preferences of any Shareholder, as
they may deem necessary, to conform this Declaration to the requirements of
the 1940 Act or any other applicable federal laws or regulations including
pursuant to Section 6.2 or the requirements of the regulated investment
company provisions of the Code, but the Trustees shall not be liable for
failing to do so.
(b) No amendment may be made to Section 2.1, Section 2.3,
Section 3.9, Section 5.1, Section 5.2, Section 11.2(a), this Section 11.3,
Section 11.4, Section 11.6 or Section 11.7 of this Declaration and no
amendment may be made to this Declaration which would change any rights
with respect to any Shares of the Trust by reducing the amount payable
thereon upon liquidation of the Trust or by diminishing or eliminating any
voting rights pertaining thereto (except that this provision shall not
limit the ability of the Trustees to authorize, and to cause the Trust to
issue, other securities pursuant to Section 6.2), except after a majority
of the Trustees have approved a resolution therefor, by the affirmative
vote of the holders of not less than seventy-five percent (75%) of the
Shares outstanding and entitled to vote, voting as a single class, unless
such amendment has been approved by 80% of the Trustees, in which case
approval by a Majority Shareholder Vote shall be required. 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, the 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 in recordable form signed by a majority of the Trustees
setting forth an amendment and reciting that it was duly adopted by the
Trustees and, if required, the Shareholders as aforesaid, or a copy of the
Declaration, as amended, in recordable form, 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 a
Registration Statement under the Securities Act covering the first public
offering of Shares of the Trust shall have become effective, 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.
11.4 Merger, Consolidation and Sale of Assets. Except as provided
in Section 11.7, 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 a majority vote of the affected Shareholders 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.
11.5 Incorporation. Upon approval by Shareholders, the Trustees
may cause to be organized or assist in organizing, a corporation or
corporations under the laws of any jurisdiction or any other trust,
partnership, limited liability company, association or other organization
to take over all of the Trust Property or to carry on any business in which
the Trust shall directly or indirectly have any interest, and to sell,
convey and transfer the Trust Property to any such corporation, trust,
partnership, limited liability company, association or organization in
exchange for the shares or securities thereof, or otherwise, and to lend
money to, subscribe for the shares or securities of, and enter into any
contracts with any such corporation, trust, partnership, limited liability
company, association or organization, or any corporation, trust,
partnership, limited liability company, association or organization in
which the Trust holds or is about to acquire shares or any other interests.
The Trustees may also cause a merger or consolidation between the Trust or
any successor thereto and any such corporation, trust, partnership, limited
liability company, association or other organization if and to the extent
permitted by law, as provided under the law then in effect. Nothing
contained herein shall be construed as requiring approval of Shareholders
for the Trustees to organize or assist in organizing one or more
corporations, trusts, partnerships, limited liability companies,
associations or other organizations and selling, conveying or transferring
a portion of the Trust Property to such organizations or entities.
11.6 Conversion. Notwithstanding any other provisions of this
Declaration or the By-Laws of the Trust, a favorable vote of a majority of
the Trustees then in office followed by the favorable vote of the holders
of not less than seventy-five percent (75%) of the Shares outstanding and
entitled to vote, voting as a single class, shall be required to approve,
adopt or authorize an amendment to this Declaration that makes the Shares
or any other class of units of beneficial interest of the Trust a
"redeemable security" as that term is defined in the 1940 Act, unless such
amendment has been approved by 80% of the Trustees, in which case approval
by a Majority Shareholder Vote shall be required. Upon the adoption of a
proposal to convert the Trust from a "closed-end company" to an "open-end
company" as those terms are defined by the 1940 Act 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. 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.
11.7 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 a majority of the Trustees then
in office followed by the affirmative vote of the holders of not less than
seventy-five percent (75%) of the Shares outstanding and entitled to vote,
voting as a single 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 corporation,
Person or other entity 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 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 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 Exchange Act, 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);
(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); or
(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).
(d) The provisions of this Section shall not be applicable to
(i) any of the transactions described in paragraph (c) of this Section if
80% of the Trustees shall by resolution have approved a memorandum of
understanding with such Principal Shareholder with respect to and
substantially consistent with such transaction, in which case approval by a
Majority Shareholder Vote shall be required, 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.
(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 corporation, person or entity beneficially
owns five percent (5%) or more 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.
ARTICLE XII
Miscellaneous
12.1 Filing. This Declaration and any amendment 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, subject to the second paragraph of
Section 11.3(c), 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.
12.2 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.
12.3 Governing Law. This Declaration is executed by 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 laws
of said State and reference shall be specifically made to the Delaware
General Corporation Law 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.
12.4 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.
12.5 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.
12.6 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 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.
/s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx
Chairman of the Board and Trustee
/s/ Xxx Xxxxxxxxx
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Xxx Xxxxxxxxx
Trustee
/s/ Xxxx X. Xxxxx
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Xxxx X. Xxxxx
Trustee
/s/ Xxxxx X. Xxxxxxxxxxx
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Xxxxx X. Xxxxxxxxxxx
Trustee
