AGREEMENT AND DECLARATION OF TRUST
OF THE
DUFF & XXXXXX GLOBAL UTILITY INCOME FUND
TABLE OF CONTENTS
ARTICLE I
The Trust
1.1 Name .................................................................... 3
1.2 Definitions ............................................................. 3
1.3 Purpose and Powers of Trust ............................................. 4
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 ........................................ 9
3.6 Collection and Payment .................................................. 10
3.7 Expenses ................................................................ 10
3.8 By-Laws ................................................................. 10
3.9 Officers and Agents ..................................................... xx
3.10 Miscellaneous Powers .................................................... 11
3.11 Delegation; Committees .................................................. 11
3.12 Further Powers .......................................................... 11
ARTICLE IV
Limitations of Liability and Indemnification
4.1 No Personal Liability of Shareholders, Trustees, etc .................... 12
4.2 Mandatory Indemnification ............................................... 12
4.3 No Duty of Investigation; Notice in Trust Instruments, etc .............. 14
4.4 Reliance on Experts, etc ................................................ 14
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
6.6 Reports ................................................................. 22
6.7 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 References; Headings; Counterparts ...................................... xx
8.2 Filing .................................................................. 27
8.3 Resident Agent .......................................................... 28
8.4 Governing Law ........................................................... 28
8.5 Counterparts ............................................................ 28
8.6 Reliance by Third Parties ............................................... 28
8.7 Provisions in Conflict with Law or Regulation ........................... 29
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AGREEMENT AND DECLARATION OF TRUST
AGREEMENT AND DECLARATION OF TRUST made as of the 12th day of March, 2004,
by the Trustee 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 statutory trust in accordance with the
provisions of the Delaware Statutory Trust Act, as amended from time to time,
and 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 March 12, 2004, shall constitute a statutory trust
under the Delaware Statutory Trust Act and that this Declaration shall
constitute the governing instrument of such statutory 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 "Duff & Xxxxxx Global Utility
Income Fund" and the Trustees shall conduct the business of the Trust under that
name or any other name or names as they may from time to time determine.
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.
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"Declaration" shall mean this Agreement and Declaration of Trust, as
amended and restated from time to time, including by way of any classifying or
reclassifying Shares of any class or any series of any such class or determining
any designations, powers, preferences, voting, conversion and other rights,
limitations, qualifications and terms and conditions thereof.
"Delaware Statutory Trust Statute" shall mean the provisions of the
Delaware Statutory Trust Act, 12 Del. C. section 3801, et. seq., as such Act may
be amended from time to time.
"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 or the applicable class or classes or series or series 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 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.
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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 not less
than two-thirds 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
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instrument, signed by two-thirds of the remaining Trustees, specifying the date
when such removal shall become effective. "Cause" for these purposes shall
require willful misfeasance, bad faith, gross negligence or reckless disregard
of the duties involved in the conduct of such Trustee. 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 a majority 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
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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 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:
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(a) manage, conduct, operate and carry on the business of an
investment company, and exercise all the powers necessary and appropriate
to the conduct of such operations;
(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.
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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. The Shareholders shall not have authority to
adopt or amend By-Laws.
3.9 Officers and Agents. The Trustees may elect and remove such officers
and appoint and terminate such agents as they deem appropriate, in accordance
with this Declaration of Trust and the By-Laws.
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, 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
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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; (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; and (j) set record dates in the manner provided
for herein or in the By-Laws.
3.11 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. 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 0000 Xxx.
3.12 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
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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
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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 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.
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ARTICLE V
Shares of Beneficial Interest
5.1 Beneficial Interest. The beneficial interest in the Trust shall be
divided into an unlimited number of transferable shares, and each share shall
have no par value per share or such other amount as the Trustees may establish.
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) to the
extent required thereby. 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
13
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.
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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 Common
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. 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 of record entitled
to such distribution 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.
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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. 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. 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 120 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 a majority 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 a majority 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
16
on which a vote of Shareholders of such class or classes is being taken.
The holders of a majority 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. Abstentions and broker non-votes will be included
for purposes of determining whether a quorum is present. Abstentions and
broker non-votes will be treated as votes present at a Shareholders'
meeting, but will not be treated as votes cast. Abstentions and broker
non-votes, therefore, will have no effect on proposals which require a
plurality or majority of votes cast for approval, but will have the same
effect as a vote "against" on proposals requiring any percentage of the
outstanding voting securities of the Trust for approval.
(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 and
entitled to vote on such matter 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
17
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 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 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 Shares 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
18
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, 3.8, 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,
3.8, 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.
19
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) (excluding Rule
23c-3 thereunder) 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 investment
company" to an "open-end investment company" as those terms are defined by the
1940 Act or a company obligated to repurchase shares under Rule 23c-3 of the
1940 Act (and "interval company"), 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" or "interval 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.
20
(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 pursuant to any offering in which such
Principal Shareholder acquires securities that represent no greater a
percentage of any class or series of securities being offered than the
percentage of any class of Shares beneficially owned by such Principal
Shareholder immediately prior to such offering or, in the case of
securities, offered in respect of another class or series, the
percentage of such other class or series beneficially owned by such
Principal Shareholder immediately prior to such offering).
(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).
21
(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 References; Headings; Counterparts. In this Declaration of Trust and
in any such restatements and/or amendments, references to this instrument, and
all expressions of similar effect to "herein," "hereof" and "hereunder," shall
be deemed to refer to this instrument as amended or affected by any such
restatements an/or amendments. Heading are placed herein for convenience of
reference only and shall not be taken as a part hereof or control or affect the
meaning, construction or effect this instrument. Whenever the singular number is
used herein, the same shall include the plural; and the neuter, masculine and
feminine genders shall include each other, as applicable. Any references herein
to specific sections of the Delaware Statutory Trust Act, the Code or the 1940
Act shall refer to such sections as amended from time to time or any successor
sections thereof.
8.2 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
22
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.
8.3 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.
8.4 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.
8.5 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.
8.6 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.
8.7 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 to the extent of such conflict;
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.
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(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/ Xxxxxxx X. Xxxxxxxx
------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Initial Trustee
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