Exhibit 1(f)
MASTER VALUE OPPORTUNITIES LLC
LIMITED LIABILITY COMPANY AGREEMENT
Dated: June 15, 2007
TABLE OF CONTENTS
Page
ARTICLE I NAME AND DEFINITIONS.............................................1
Section 1.1. Name....................................................1
Section 1.2. Definitions.............................................2
ARTICLE II DIRECTORS.................................................4
Section 2.1. Number of Directors and Qualification...................4
Section 2.2. Term and Election.......................................5
Section 2.3. Resignation, Retirement and Removal.....................5
Section 2.4. Vacancies...............................................5
Section 2.5. Meetings................................................5
Section 2.6. Officers; Chairman......................................6
Section 2.7. By-Laws.................................................6
ARTICLE III POWERS OF DIRECTORS.......................................6
Section 3.1. General.................................................6
Section 3.2. Activities and Investments..............................7
Section 3.3. Legal Title.............................................8
Section 3.4. Sale of Interests; Reclassification.....................9
Section 3.5. Borrowing Money; Pledging Company Assets;
Lending Property........................................9
Section 3.6. Delegation; Committees..................................9
Section 3.7. Collection and Payment..................................9
Section 3.8. Expenses................................................9
Section 3.9. Common Items............................................9
Section 3.10. Litigation.............................................10
Section 3.11. Tax Matters............................................10
Section 3.12. Miscellaneous Powers...................................10
Section 3.13. Manner of Acting.......................................11
ARTICLE IV MANAGEMENT, ADMINISTRATIVE SERVICES AND PLACEMENT
AGENT ARRANGEMENTS; CUSTODIAN............................11
Section 4.1. Management and Other Arrangements......................11
Section 4.2. Parties to Contract....................................11
Section 4.3. Custodian..............................................11
ARTICLE V INTERESTS IN THE COMPANY.................................12
Section 5.1. Interests..............................................12
Section 5.2. Classes of Interests...................................12
Section 5.3. Rights of Holders......................................13
Section 5.4. Admission of Holders; Increase in Interests............13
(i)
Section 5.5. Register of Interests..................................13
Section 5.6. Non-Transferability....................................13
Section 5.7. Notices................................................13
Section 5.8. Limitation on Number of Holders........................13
Section 5.9. No Liability of Holders................................14
ARTICLE VI DECREASES AND WITHDRAWALS................................14
Section 6.1. Decreases and Withdrawals..............................14
ARTICLE VII DETERMINATION OF BOOK CAPITAL ACCOUNT BALANCES,
NET INCOME AND DISTRIBUTIONS.............................14
Section 7.1. Book Capital Account Balances..........................14
Section 7.2. Allocations and Distributions to Holders...............14
Section 7.3. Power to Modify Foregoing Procedures...................15
ARTICLE VIII LIABILITY FOR COMPANY OBLIGATIONS; FIDUCIARY DUTIES......15
Section 8.1. No Personal Liability of Directors, etc................15
Section 8.2. Indemnification........................................15
Section 8.3. No Protection Against Certain 1940 Act Liabilities.....16
Section 8.4. No Bond Required of Directors..........................17
Section 8.5. No Duty of Investigation; Notice in
Company Instruments, etc...............................17
Section 8.6. Insurance..............................................17
Section 8.7. Reliance on Experts, etc...............................17
Section 8.8. Accounting.............................................18
ARTICLE IX HOLDERS..................................................18
Section 9.1. Meetings of Holders....................................18
Section 9.2. Notice of Meetings.....................................18
Section 9.3. Record Date for Meetings...............................18
Section 9.4. Proxies, etc...........................................18
Section 9.5. Reports................................................19
Section 9.6. Inspection of Records..................................19
Section 9.7. Holder Action by Written Consent.......................19
ARTICLE X DURATION; DISSOLUTION OF COMPANY; AMENDMENT;
MERGERS; ETC.............................................19
Section 10.1. Duration...............................................19
Section 10.2. Dissolution of Company.................................19
Section 10.3. Actions Upon Dissolution...............................20
Section 10.4. Amendment Procedure....................................20
Section 10.5. Merger, Consolidation, Conversion and Sale of Assets...21
(ii)
ARTICLE XI MISCELLANEOUS............................................22
Section 11.1. Registered Agent.......................................22
Section 11.2. Governing Law..........................................22
Section 11.3. Reliance by Third Parties..............................22
Section 11.4. Provisions in Conflict with Law or Regulations.........22
Section 11.5. Company Only...........................................22
(iii)
LIMITED LIABILITY COMPANY AGREEMENT
OF
MASTER VALUE OPPORTUNITIES LLC
This Limited Liabilities Company Agreement ("Agreement") of Master Value
Opportunity LLC (the "Company"), is made as of June 15, 2007, by the Directors
named herein and the Holders (as hereinafter defined) of the Company on the date
hereof and those persons and entities hereinafter admitted as Holders.
W I T N E S S E T H:
WHEREAS, this Agreement is made and entered into for the purpose of
continuing the business of Master Value Opportunity Trust, a Delaware statutory
trust (the "Trust"), as a Delaware limited liability company in accordance with
the provisions hereinafter set forth;
WHEREAS, the Trust was converted into the Company pursuant to the Delaware
Statutory Trust Act (12 Del. C. ss.3801 et. seq.) and Section 18-214 of the Act
(as defined herein) (the "Conversion"), by causing to be filed a Certificate of
Conversion and a Certificate of Formation with the office of the Secretary of
State of the State of Delaware on June 15, 2007;
WHEREAS, the Directors desire to continue the Company as a limited
liability company under the Act and have adopted this Agreement; and
NOW, THEREFORE, it being the intention that this Agreement constitute the
limited liability company agreement of the Company, it is declared that the
Directors will oversee the management of all cash, securities and other assets
which the Company now possesses or may hereafter acquire from time to time in
any manner and oversee the disposal of the same upon the following terms and
conditions for the pro rata benefit of the holders of Interests in the Company.
ARTICLE I
NAME AND DEFINITIONS
Section 1.1. Name. The name of the limited liability company formed hereby
is "Master Value Opportunities LLC" and, insofar as may be practicable, the
Company shall conduct its activities, execute all documents and xxx or be sued
under that name, which name (and the word "Company" wherever herein used) shall
refer to the Company as a separate legal entity, and shall not refer to the
Directors, officers, agents, employees or Holders. If the Directors determine
that the Company's use of such name is not advisable, the Directors may adopt
such other name for the Company as they deem proper and the Company may hold its
property and conduct its activities under such other name. Any name change shall
become effective upon the execution by a Director, as an "authorized person" of
the Company, of an instrument setting forth the new name and the filing of a
Certificate of Amendment under the Act. Any such instrument shall have the
status of an amendment to this Agreement.
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Effective as of the time of the Conversion, (i) the Certificate of Trust of the
Trust, the Declaration of Trust of the Trust and the By-Laws of the Trust, in
each case as in effect immediately prior to the Conversion, are replaced and
superseded in their entirety by the Certificate of Formation of the Company,
this Agreement and the By-Laws in respect of all periods beginning on or after
the Conversion, (ii) each of the Persons who was a holder of beneficial
interests in the Company immediately prior to the Conversion is hereby
automatically admitted as a Holder of the Company, and is hereby issued the
Interests reflected on the books and records of the Company, and (iii) in
accordance with Section 18-214(g) of the Act, the Company shall constitute a
continuation of the existence of the Trust in the form of a Delaware limited
liability company and, for all purposes of the laws of the State of Delaware,
the Company shall be deemed to be the same entity as the Trust. Xxxxx X.
Xxxxxxxxxx, is hereby designated as an "authorized person" within the meaning of
the Act, and has executed, delivered and filed the Certificate of Conversion and
the Certificate of Formation with the Secretary of State of the State of
Delaware. Upon the filing of the Certificate of Formation and the Certificate of
Conversion with the Secretary of State of the State of Delaware, such person's
powers as an "authorized person" ceased, and each Director, acting alone,
thereupon became a designated "authorized person" to execute, deliver and file
any amendments and/or restatements of the Certificate of Formation and any other
certificates (and any amendments and/or restatements thereof) permitted to be
filed with the Secretary of State of the State of Delaware
Section 1.2. Definitions. Wherever they are used herein, the following
terms have the respective meanings assigned to them below:
(a) "Administrator" means any party furnishing services to the
Company pursuant to any administrative services contract described in
Section 4.1.
(b) "Act" means the Delaware Limited Liability Company Act, 6 Del.
C. ss.1801 et seq. as the same may be amended from time to time.
(c) "Agreement" means this limited liability company agreement of
the Company as amended from time to time. References in this Agreement to
"Agreement", "hereof", "herein" and "hereunder" shall be deemed to refer
to the Agreement rather than the article or section in which such words
appear.
(d) "Affiliated Person" has the meaning assigned to it in Section
2(a)(3) of the 1940 Act.
(e) "Book Capital Account" means, for any Holder at any time, the
Book Capital Account of the Holder at such time with respect to such
Holder's interest in the Company Property, determined in accordance with
generally accepted accounting principles and the provisions of the 1940
Act.
(f) "By-Laws" means the By-Laws referred to in Section 2.7 hereof,
as amended and in effect from time to time. The By-Laws are hereby
incorporated by reference into this Agreement.
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(g) "Code" means the Internal Revenue Code of 1986 and the rules and
regulations thereunder, each as amended from time to time.
(h) "Company Property" means 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 Company.
(i) "Commission" means the Securities and Exchange Commission.
(j) "Custodian" means the party, other than the Company, to the
agreement described in Section 4.3 hereof.
(k) "Directors" means the individuals who are named in Section
2.1(b) of this Agreement, so long as such Persons shall continue in office
in accordance with the provisions hereof, and all other Persons who may
from time to time be duly elected or appointed, qualified and serving as
Directors in accordance with the provisions hereof, and reference herein
to a Director or the Directors shall refer to such individual or Persons
in their capacity as "managers" within the meaning of the Act hereunder.
(l) "Fundamental Policies" means the investment policies and
restrictions of the Company that are set forth and designated as
fundamental policies in the Registration Statement.
(m) "Holders" means as of any particular time any Institutional
Investor that is a holder of record of Interests in the Company of any
class at such time, each in its capacity as a member of the Company.
(n) "Institutional Investor(s)" means any registered investment
company (including a unit investment trust), insurance company separate
account, common or commingled trust fund, group trust or similar
organization or entity that is an "accredited investor" with in the
meaning of Regulation D under the Securities Act of 1933, and shall not
include any individual, S corporation, partnership, or grantor trust
beneficially owned by any individual, S corporation or partnership.
(o) "Interested Person" has the meaning ascribed to it in Section
2(a)(19) of the 1940 Act.
(p) "Interest(s)" shall mean the interest of a Holder in the Company
of any class, including all rights, powers and privileges accorded to
Holders in this Agreement, which interest maybe expressed as a percentage,
determined by calculating, as the Directors shall from time to time
determine, the ratio of each Holder's Book Capital Account balance in the
Company of any class to the total of all Holders' Book Capital Account
balances in the Company of any class. Reference herein to a specific
percentage in, or fraction of, Interests of the Holders means Holders
whose combined Book Capital Accounts represent such specified percentage
or fraction of the Book Capital Accounts of all Holders in
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the Company of any class or of the Company as a whole (as the context may
require).
(q) "Investment Adviser" means the party, other than the Trust, to
any investment management contract described in Section 4.1 hereof.
(r) "1940 Act" means the provisions of the Investment Company Act of
1940 and the rules and regulations thereunder as amended from time to time
and any order or orders thereunder which may from time to time be
applicable to the Company.
(s) "Person" means and includes individuals, corporations,
partnerships, trusts, associations, joint ventures and other entities,
whether or not legal entities, and governments and agencies and political
subdivisions thereof.
(t) "Registration Statement" means any Registration Statement filed
by the Company under the 1940 Act, as it may be amended or supplemented
from time to time.
(u) The use herein of the masculine or feminine gender or the
neutral shall be construed to refer to the other gender or the neutral as
well, and the use herein of the singular shall be construed to include the
plural and the plural to include the singular, as the context may require.
ARTICLE II
DIRECTORS
Section 2.1. Number of Directors and Qualification.
(a) The number of Directors shall initially be five (5) and shall
thereafter be such number as shall be fixed from time to time by a written
instrument signed by a majority of the Directors then in office; provided,
however, that the number of Directors shall, subsequent to any sale of
Interests other than sales made solely for the purposes of meeting any
applicable seed money requirement under the 1940 Act, in no event be less
than three (3) or more than fifteen (15). Any vacancy created by an
increase in Directors may be filled by the appointment of any Person
having the qualifications described in this Article made by a written
instrument signed by a majority of the Directors then in office. Any such
appointment shall not become effective, however, until the Person named in
the written instrument of appointment shall have accepted in writing such
appointment and agreed in writing to be bound by the terms of this
Agreement. No reduction in the number of Directors shall have the effect
of removing any Director from office. Whenever a vacancy in the number of
Directors shall occur, until such vacancy is filled as provided in this
Section 2.1 and Section 2.4 hereof, the Directors in office, regardless of
their number, shall have all the powers granted to the Directors and shall
discharge all the duties
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imposed upon the Directors by this Agreement. Each Director is hereby a
"manager" within the meaning of the Act.
(b) The initial Directors are Xxxxxx X. Xxxx, Xx., Xxxxxx X. Xxxxxx,
Xxxx X. X'Xxxxx, Xxxxx X. Xxxxx, and Xxxx X. Xxxxx.
Section 2.2. Term and Election. Each Director named herein, or elected or
appointed prior to the first meeting of the Holders, shall (except in the event
of resignations or removals or vacancies pursuant to Section 2.3 or Section 2.4
hereof) hold office until his successor has been elected at such meeting and has
qualified to serve as Director, as required under the 1940 Act. Each Director
shall hold office during the lifetime of this Company and until its dissolution
as hereinafter provided or until December 31 of the year in which he shall have
reached 72 years of age unless such Director resigns or is removed as provided
in Section 2.3 below.
Section 2.3. Resignation, Retirement and Removal. Any Director may resign
(without need for prior or subsequent accounting) by an instrument in writing
signed by him and delivered to the other Directors, and such resignation shall
be effective upon such delivery or at any later date according to the terms of
the instrument. Any of the Directors may be removed by the action of two-thirds
of the remaining Directors; provided, that if the removal of one or more
Directors would have the effect of reducing the number of remaining Directors
below the minimum number prescribed by Section 2.1 hereof, then subject to
Section 16(a) of the 1940 Act, at the time of the removal of such Director or
Directors, the remaining Directors shall elect or appoint a number of additional
Directors at least sufficient to increase the number of Directors holding office
to the minimum number prescribed by Section 2.1 hereof. Upon the resignation,
retirement or removal of a Director, or his otherwise ceasing to be a Director
due to death or legal disability, he shall execute and deliver such documents as
the remaining Directors shall require for the purpose of conveying to the
Company or the remaining Directors any Company Property held in his name. Upon
the death or legal disability of any Director, his legal representative shall
execute and deliver on his behalf such documents as the remaining Directors
shall require as provided in the preceding sentence.
Section 2.4. Vacancies. The term of office of a Director shall terminate
and a vacancy shall occur in the event of such Director's death, resignation,
retirement, removal, bankruptcy, adjudicated incompetence or other legal
disability to perform the duties of the office of Director. No such vacancy
shall operate to annul this Agreement or to revoke any existing obligations
created pursuant to the terms of this Agreement. In the case of a vacancy, the
Holders of at least a majority of the Interests cast, acting at any meeting of
the Holders held in accordance with Section 9.1 hereof, or, to the extent
permitted by the 1940 Act, a majority vote of the Directors continuing in office
acting by written instrument or instruments, may fill such vacancy, and any
Director so elected by the Directors or the Holders shall hold office as
provided in this Agreement.
Section 2.5. Meetings. Regular meetings of the Directors may be held on
such notice at such place or places and times as may be fixed by the By-Laws or
by resolution of the Directors. Special Meetings of the Directors shall be held
upon the call of the Chairman, if any, the president, the secretary, or any
Director, by oral or electronic or written notice duly served on
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or sent, mailed or sent by telecopy or e-mail to each Director not less than one
day before the meeting. No notice need be given to any Director who attends in
person or to any Director who, in writing signed and filed with the records of
the meeting either before or after the holding thereof, waives notice. Notice or
waiver of notice need not state the purpose or purposes of the meeting. The
Directors may act with or without a meeting, subject to the requirements of the
1940 Act. A quorum for all meetings of the Directors shall be a majority of the
Directors. Unless provided otherwise in this Agreement, any action of the
Directors may be taken at a meeting by vote of a majority of the Directors
present (a quorum being present) or without a meeting by written consent of a
majority of the Directors.
Any committee of the Directors, 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 Agreement, 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.
With respect to actions of the Directors and any committee of the
Directors, Directors who are Interested Persons of the Company within the
meaning of Section 1.2 hereof or otherwise interested in any action to be taken
may be counted for quorum purposes under this Section 2.5 and shall be entitled
to vote to the extent permitted by the 1940 Act.
All or any one or more Directors may participate in a meeting of the
Directors 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 and participation in a meeting pursuant to such
communications system shall constitute presence in person at such meeting.
Section 2.6. Officers; Chairman. The Directors shall, from time to time,
elect a President, a Secretary and a Treasurer. The Directors may elect or
appoint, from time to time, a Chairman who shall preside at all meetings of the
Directors and carry out such other duties as the Directors shall designate. The
Directors may elect or appoint or authorize the President to appoint such other
officers or agents with such powers as the Directors may deem to be advisable.
The President, the Secretary and the Treasurer may, but need not, be Directors.
Section 2.7. By-Laws. The Directors may adopt By-Laws not inconsistent
with this Agreement for the conduct of activities of the Company and may amend
or repeal such By-Laws to the extent such power is not reserved to the Holders
by express provision of such By-Laws. This Agreement and the By-Laws shall
together constitute the limited liability company agreement of the Company
within the meaning of the Act.
ARTICLE III
POWERS OF DIRECTORS
Section 3.1. General. The Directors shall have exclusive and absolute
authority and control over the Company Property and over the activities of the
Company to the fullest extent permitted by the Act and other applicable law, but
with such powers of delegation as may
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be permitted by this Agreement. The Directors shall have power to conduct the
activities of the Company and to carry on their operations and maintain offices
both within and without the State of Delaware, in any and all states of the
United States of America, and in the District of Columbia, in any foreign
country, 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 Company although such things are not herein specifically
mentioned. Any determination as to what is in the interests of the Company made
by the Directors in good faith shall be conclusive. In construing the provisions
of this Agreement, the presumption shall be in favor of a grant of power to the
Directors. The Directors will not be required to obtain any court order to deal
with Company Property.
The enumeration of any specific power herein shall not be construed as
limiting the aforesaid powers. Such powers of the Directors may be exercised
without order of or resort to any court.
Section 3.2. Activities and Investments. The Directors shall have the
power with respect to the Company:
(a) to conduct, operate and carry on the activities of an investment
company, and, in connection therewith:
(i) to subscribe for, purchase or otherwise acquire and invest
and reinvest in, to hold for investment or otherwise, to sell,
transfer, assign, negotiate, exchange, lend or otherwise dispose of,
and to turn to account or realize upon and generally deal in and
with, domestic or foreign securities (which term, "securities,"
shall include without limitation any and all bills, notes, bonds,
debentures or other obligations or evidences of indebtedness,
certificates of deposit, bankers acceptances, commercial paper,
repurchase agreements or other money market instruments; stocks,
shares or other equity ownership interests (including non-publicly
traded or illiquid securities and those securities the disposition
of which is restricted under the Federal securities laws);
convertible securities; mortgage-backed or other asset-backed
securities; and warrants, options or other instruments representing
rights to subscribe for, purchase, receive or otherwise acquire or
to sell, transfer, assign or otherwise dispose of, and scrip,
certificates, receipts or other instruments evidencing any ownership
rights or interests in, any of the foregoing; and "forward
commitment", "when issued" and "delayed delivery" contracts for
securities, issued, guaranteed or sponsored by any governments,
political subdivisions or governmental authorities, agencies or
instrumentalities, by any individuals, firms, companies,
corporations, syndicates, associations or trusts, or by any other
organizations or entities whatsoever, irrespective of their forms or
the names by which they may be described, whether or not they be
organized and operated for profit, and
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whether they be domestic or foreign with respect to the State of
Delaware or the United States of America); and
(ii) to acquire and become the owner of or interested in any
securities by delivering or issuing in exchange or payment therefor,
in any lawful manner, any of the Company Property; and
(iii) to exercise while the owner of any securities or
interests therein any and all of the rights, powers and privileges
of ownership of such securities or interests, including without
limitation any and all voting rights and rights of assent, consent
or dissent pertaining thereto, and to do any and all acts and things
for the preservation, protection, improvement and enhancement in
value thereof; and
(iv) to purchase, sell and hold currencies and enter into
contracts for the future purchase or sale of currencies, including
but not limited to forward foreign currency exchange contracts; and
(v) to enter into futures and forward contracts, and to
purchase and write put and call options on futures contracts,
securities, currencies and securities indexes; and
(vi) to make loans to the extent provided in the Registration
Statement from time to time; and
(vii) to engage in such other activities as may be disclosed
in the Registration Statement from time to time; and
(b) to conduct, operate and carry on any other lawful activities
which the Directors, in their sole and absolute discretion, consider to be
(i) incidental to the activities of the Company as an investment company,
(ii) conducive to or expedient for the benefit or protection of the
Company or the Holders, or (iii) calculated in any other manner to promote
the interests of the Company or the Holders.
The Directors shall not be limited to investing in securities maturing before
the possible dissolution of the Company, nor shall the Directors be limited by
any law limiting the investments that may be made by fiduciaries.
Notwithstanding anything to the contrary herein contained but consistent with
the applicable investment objectives, the Company shall be managed in compliance
with the requirements of the Code applicable to regulated investment companies.
Section 3.3. Legal Title. Legal title to all the Company Property shall be
vested in the Company as a separate legal entity, except that the Directors
shall have power to cause legal title to any Company Property to be held by or
in the name of one or more of the Directors on behalf of the Company, or in the
name of any other Person as nominee on behalf of the Company, on such terms as
the Directors may determine; provided, that the interest of the Company therein
is appropriately protected.
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Section 3.4. Sale of Interests; Reclassification. Subject to more detailed
provisions set forth in Article V and the Directors' duty of impartiality to the
Holders, the Directors shall have the power to permit any Institutional Investor
to purchase Interests and to add to or reduce, in whole or in part, their
Interests in any class; provided that from and after the commencement of the
private placement of Interests, Interests shall be sold only to Institutional
Investors, and the original Holders shall withdraw their entire Interests from
the class. The Directors shall also have the power to acquire, hold, resell,
dispose of, transfer, classify, reclassify and otherwise deal in Interests of
the Company or class. The Directors may hold as treasury Interests (without such
Interests being deemed to be canceled), re-issue for such consideration and on
such terms as they determine, or cancel, in their discretion from time to time,
any Interests in any class thereof reacquired by the Company.
Section 3.5 Borrowing Money; Pledging Company Assets; Lending Property.
Subject to any applicable Fundamental Policies of the Company or any applicable
provision of the By-Laws, the Directors shall have power, on behalf of the
Company, to borrow money or otherwise obtain credit and to secure the same by
mortgaging, pledging or otherwise subjecting as security any of the Company
Property, to endorse, guarantee, or undertake the performance of any obligation,
contract or engagement of any other Person and to lend Company Property.
Section 3.6. Delegation; Committees. The Directors shall have power,
consistent with their continuing exclusive authority over the management of the
Company and the Company Property, to delegate from time to time to such
committee or committees as they may from time to time appoint from among their
own number or to such officers, employees or agents of the Company as they may
from time to time designate the doing of such things and the execution of such
instruments either in the name of the Company or the names of the Directors or
otherwise as the Directors may deem expedient.
Section 3.7. Collection and Payment. The Directors shall have power to
collect all property due to the Company; to pay all claims, including taxes,
against the Company Property; to prosecute, defend, compromise or abandon any
claims relating to the Company Property; to foreclose any security interest
securing any obligations by virtue of which any property is owed to the Company;
and to enter into releases, agreements and other instruments.
Section 3.8. Expenses. The Directors shall have the power to incur and
pay, out of the income or the principal of the Company Property, any expenses
which, in the opinion of the Directors, are necessary or incidental to carrying
out any of the purposes of this Agreement, and to pay reasonable compensation
from the funds of the Company to themselves as Directors. The Directors shall
not be obligated to account to the Holders for the retention of compensation,
and each Holder agrees that compliance with the accounting requirements of the
1940 Act and of this Agreement shall constitute satisfactory accounting with
respect to all acts of the Directors. The Directors shall fix the compensation
of all officers, employees and Directors of the Company and may pay such
compensation out of the Company Property without reduction of the Directors'
compensation.
Section 3.9. Common Items. Except as otherwise determined by the
Directors, all expenses and other items of the Company shall be borne by or
allocated to each Holder proportionately based upon the relative net asset
values of each Holder. Such common items
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shall include, but not be limited to, Directors' fees; 1940 Act registration
expenses; organizational expenses of the Trust; and accounting expenses relating
to the Trust.
Section 3.10. Litigation. The Directors shall have the power to engage in
and to prosecute, defend, compromise, abandon, or adjust, by arbitration or
otherwise, any actions, suits, proceedings, disputes, claims, and demands
relating to the Company or the Company Property, and, out of the Company
Property, to pay or to satisfy any debts, claims or expenses incurred in
connection therewith, including those of litigation, and such power shall
include without limitation the power of the Directors or any appropriate
committee thereof, in the exercise of their or its good faith business judgment,
consenting to dismiss any action, suit, proceeding, dispute, claim or demand,
brought by any Person, including, to the extent permitted by applicable law, a
Holder in such Holder's own name or in the name of the Company, whether or not
the Company, or any of the Directors may be named individually therein or the
subject matter arises by reason of business for or on behalf of the Company.
Section 3.11. Tax Matters. The Directors shall have the exclusive power,
authority and responsibility with respect to the Company regarding (i)
preparation and filing of tax returns; (ii) providing reports to the Holders
regarding tax information necessary to the filing of their respective tax
returns; (iii) making any and all available elections with respect to the tax
treatment of the Company and its investments; (iv) representing the Company
before the Internal Revenue Service and/or any state taxing authority and
exercising the powers and authorities of a tax matters partner under the Code
with respect to the Company's tax returns; (v) exercising such responsibility as
may be imposed by law with respect to withholding from a Holder's share of
income or distributions; (vi) providing to the accountants of the Company such
instructions regarding allocations of realized income, gains and losses as may
be necessary or appropriate to assure compliance by the Company with applicable
provisions of the Code and Treasury Regulations; and (vii) any and all other tax
matters.
Section 3.12. Miscellaneous Powers. The Directors shall have the power to:
(a) employ or contract with such Persons as the Directors may deem desirable for
the transaction of the activities of the Company and eliminate such employees or
contractual relationships as they consider appropriate; (b) enter into joint
ventures, partnerships and any other combinations or associations; (c) remove
Directors or fill vacancies in or add to their number, subject to and in
accordance with Section 2.3 and Section 2.4 hereof; elect and remove at will
such officers and appoint and terminate such agents or employees as they
consider appropriate; and appoint from their own number and terminate at will
any one or more committees that may exercise some or all of the power and
authority of the Directors as the Directors may determine; (d) purchase, and pay
for out of Company Property, insurance policies insuring the Company Property,
and, to the extent permitted by law and not inconsistent with any applicable
provision of this Agreement or the By-Laws, insuring the Investment Adviser,
Administrator, placement agent, Holders, Directors, officers, employees, agents
or independent contractors of the Company against all claims arising by reason
of holding any such position or by reason of any action taken or omitted to be
taken by any such Person in such capacity, whether or not constituting
negligence, or whether or not the Company would have the power to indemnify such
Person against such liability; (e) indemnify any person with whom the Company
has dealings, including the Holders, Directors, officers, employees, agents, the
Investment Adviser, Administrator, placement agent and independent contractors
of the Company, to such extent permitted by law and not
10
inconsistent with the applicable provisions of this Agreement; (f) subject to
applicable Fundamental Policies, guarantee indebtedness or contractual
obligations of others; (g) determine and change the fiscal year of the Company
and the method by which its accounts shall be kept; and (h) adopt a seal for the
Company, but the absence of such seal shall not impair the validity of any
instrument executed on behalf of the Company.
Section 3.13. Manner of Acting. Except as otherwise provided herein, in
the By-Laws, in the 1940 Act or in any other applicable provision of law, any
action to be taken by the Directors may be taken in the manner set forth in
Section 2.5 hereof.
ARTICLE IV
MANAGEMENT, ADMINISTRATIVE SERVICES
AND PLACEMENT AGENT ARRANGEMENTS; CUSTODIAN
Section 4.1. Management and Other Arrangements. The Directors may in their
discretion, from time to time, enter into management and administrative services
contracts or placement agent agreements whereby the other party to such contract
or agreement shall undertake to furnish such management, administrative,
placement agent and/or other services as the Directors shall, from time to time,
consider desirable with respect to the Company and upon such terms and
conditions as the Directors may in their discretion determine. Notwithstanding
any other provisions of this Agreement, the Directors may authorize any
Investment Adviser (subject to such general or specific instructions as the
Directors may, from time to time, adopt) to effect purchases, sales, loans or
exchanges of Company Property or may authorize any officer, employee or Director
to effect such purchases, sales, loans or exchanges pursuant to recommendations
of any such Investment Adviser (and all without further action by the
Directors). Any such purchase, sales, loans and exchanges shall be deemed to
have been authorized by all of the Directors.
Section 4.2. Parties to Contract. Subject to the provisions of Section
8.1(c), any contract of the character described in Section 4.1 of this Article
IV or in the By-Laws of the Company may be entered into with any corporation,
firm, trust or association, although one or more of the Directors or officers of
the Company may be an officer, director, Director, 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 Company 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 (including a firm, corporation, trust, or association) may be the
other party to contracts entered into pursuant to Section 4.1 above or the
By-Laws of the Company, 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 4.2.
Section 4.3. Custodian. The Directors may appoint one or more banks or
trust companies as custodian of the securities and cash belonging to the
Company. The agreement providing for such appointment shall contain such terms
and conditions as the Directors in their
11
discretion determine to be not inconsistent with this Agreement, the applicable
provisions of the 1940 Act and any applicable provisions of the By-Laws of the
Company. One or more subcustodians may be appointed in a manner not inconsistent
with this Agreement, the applicable provisions of the 1940 Act and any
applicable provisions of the By-Laws of the Company.
ARTICLE V
INTERESTS IN THE COMPANY
Section 5.1. Interests. Subject to the limitations contained in Section
5.8 relating to the number of permitted Holders, the limited liability company
interests in the Company shall consist of an unlimited number of
non-transferable Interests that shall be denominated in dollars corresponding to
the value of such Interests determined by reference to the corresponding Book
Capital Accounts. All Interests shall be validly issued, fully paid and
nonassessable when issued for such consideration as the Directors shall
determine. The Directors may permit the purchase of Interests (for cash or other
consideration acceptable to the Directors, subject to the requirements of the
0000 Xxx) but only if the purchaser is an Institutional Investor. Subject to
applicable law, the provisions hereof and such restrictions as may be adopted by
the Directors, any Holder may increase its Interest by contributions or decrease
its Interest by withdrawals without limitation. Any Person to whom Interests are
issued after the date hereof shall be deemed admitted to the Company as a Holder
upon its acquisition of an Interest and its reflection on the register of
Holders.
Section 5.2. Classes of Interests. The Directors may, without approval of
the Holders of any Interests, establish and designate classes of Interests or
divide Interests into two or more classes, Interests of each class having such
preferences and special or relative rights and privileges (including conversion
rights, if any) as the Directors may determine in their sole discretion.
The establishment and designation of any class of Interests shall be
effective upon the execution by the Secretary or an Assistant Secretary of the
Company, pursuant to authorization by a majority of the Directors, of an
instrument setting forth such establishment and designation and the relative
rights and preferences of such class. The Directors may amend the By-Laws
providing for class votes and meetings and related matters. Notwithstanding
anything set forth herein, classes of Interests shall not be required to vote or
receive distributions on a pro rata basis unless required by applicable law or
the terms of the instrument establishing such class.
The Interests shall have the following relative rights and preferences: on
each matter submitted to a vote of the Holders, each Holder of an Interest shall
be entitled to a vote proportionate to its Interest as recorded on the books of
the Company and all Holders of Interests shall vote by class except as to voting
for Directors and as otherwise required by the 1940 Act, in which case all
Holders shall vote together as a single class. As to any matter that does not
affect the interest of a particular class, only the Holders of Interests of the
one or more affected classes shall be entitled to vote.
12
Section 5.3. Rights of Holders. The ownership of the Company Property of
every description and the right to conduct any activities hereinbefore described
shall be vested exclusively in the Company, and the Holders shall have no
interest therein. Holders shall have no right to call for any partition or
division of any property, profits, rights or interests of the Company. The
Interests shall be personal property giving only the rights specifically set
forth in this Agreement and the Act. The Holders shall have no right to demand
payment for their Interests or any other rights of dissenting shareholders in
the event the Company participates in any transaction that would give rise to
appraisal or dissenter's rights by a shareholder of a corporation organized
under the General Corporation Law of the State of Delaware or otherwise. Holders
shall have no preemptive or other rights to subscribe for additional Interests
or other securities issued by the Company. All Persons, by virtue of acquiring
an Interest in the Company and being registered as a Holder in accordance with
Section 5.5 hereof, shall be deemed to have assented to, and shall be bound by,
this Agreement to the same extent as if such Person was a party hereto.
Section 5.4. Admission of Holders; Increase in Interests. The Directors,
in their discretion, may, from time to time, without a vote of the Holders,
permit the admission of an Institutional Investor as a Holder or an increase in
the Interest of an Institutional Investor or Institutional Investors (including
existing Holders), subject to the provisions of Section 5.1 hereof, and for such
type of consideration, including cash or property, at such time or times
(including, without limitation, each business day), and on such terms as the
Directors may deem best, 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.
Section 5.5. Register of Interests. A register shall be kept by the
Company that shall contain the names and addresses of the Holders and the Book
Capital Account balances of each Holder. Each such register shall be conclusive
as to who the Holders are and who shall be entitled to payments of distributions
or otherwise to exercise or enjoy the rights of Holders. No Holder shall be
entitled to receive payment of any distribution, nor to have notice given to it
as herein provided, until it has given its address to such officer or agent of
the Company as shall keep the said register for entry thereon.
Section 5.6. Non-Transferability. To the fullest extent permitted by law,
Interests shall not be transferable and no transferee shall be recognized as a
Holder except with the prior written consent of all of the Directors and all
remaining Holders of Interests.
Section 5.7. Notices. Any and all notices to which any Holder hereunder
may be entitled and any and all communications shall be deemed duly served or
given if mailed, postage prepaid, addressed to any Holder of record at its last
known address as recorded on the register of the Company or transmitted to the
Holders by any other method permitted by law.
Section 5.8. Limitation on Number of Holders. Notwithstanding any
provision hereof to the contrary, the number of Holders of Interests shall be
limited to fewer than 100. Solely for purposes of determining the number of
Holders of Interests under this Section 5.8, each beneficial owner of a grantor
trust that is itself a Holder shall be treated as a Holder of such Interest.
13
Section 5.9. No Liability of Holders. All Interests, when issued in
accordance with this Agreement, shall be fully paid and nonassessable. Holders
shall be entitled to the full protection against personal liability for the
obligations of the Company under Section 18-303 of the Act. The Company shall
indemnify to the fullest extent permitted by law and hold each Holder harmless
from and against any claim or liability to which such Holder may become subject
solely by reason of his or her being or having been a Holder and not because of
such Holder's acts or omissions or for some other reason, and shall reimburse
such Holder for all legal and other expenses reasonably incurred by him or her
in connection with any such claim or liability (upon proper and timely request
by the Holder).
ARTICLE VI
DECREASES AND WITHDRAWALS
Section 6.1. Decreases and Withdrawals. A Holder shall have the right on
any day the New York Stock Exchange is open to decrease its Interest in the
Company and to withdraw completely from, at the next determined net asset value
attributable to the Interest (or portion thereof) being withdrawn, and an
appropriate adjustment therefor shall be made to such Holder's Book Capital
Account. The rights of a Holder upon withdrawal from the Company shall be
limited to the assets belonging to the class with respect to which the
withdrawal is made. The Company may, subject to compliance with the 1940 Act,
charge fees for effecting such decrease or withdrawal, at such rates as the
Directors may establish, and may at any time and from time to time, suspend such
right of decrease or withdrawal. The procedures for effecting decreases or
withdrawals shall be as determined by the Directors from time to time, subject
to the requirements of the 1940 Act.
ARTICLE VII
DETERMINATION OF BOOK CAPITAL ACCOUNT BALANCES,
NET INCOME AND DISTRIBUTIONS
Section 7.1. Book Capital Account Balances. The Book Capital Account
balances of Holders of the Company shall be determined on such days and at such
time or times as the Directors may determine, consistent with the requirements
of the 1940 Act, with income, gains and losses of each class thereof determined
in accordance with generally accepted accounting principles to be allocated
among the Holders of such class thereof in accordance with their Interests. The
power and duty to make calculations of the Book Capital Account balances of the
Holders may be delegated by the Directors to the Investment Adviser,
Administrator, Custodian, or such other person as the Directors may determine.
Section 7.2. Allocations and Distributions to Holders. In compliance with
the Treasury Regulations promulgated under applicable provisions of the Code,
the Directors shall (i) allocate items of taxable income, gain, loss and
deduction with respect to each Holder; provided that, except as may otherwise be
specifically provided in the Treasury Regulations, in all cases allocations of
specific types of income shall be proportionate to the Interests of the Holders
in a particular class thereof, and (ii) upon liquidation of the Interests of a
Holder, make final distribution of the net assets of such a particular Holder in
accordance with such Holder's
14
respective Book Capital Accounts. The Directors shall provide each Holder that
is a regulated investment company, as defined in Section 851(a) of the Code,
information that will enable it to take into account its share of items of
taxable income, gain, loss and deduction as they are taken into account by the
Company in order to facilitate compliance with Code Section 4982. Any income tax
withholding or other withholding of taxes required by law with respect to the
allocable share of income of, or distributions to, a Holder shall be accounted
for as a distribution to and charged to the Book Capital Account of such Holder
at the time of payment of such taxes to the applicable taxing authority.
Section 7.3. Power to Modify Foregoing Procedures. Notwithstanding any of
the foregoing provisions of this Article VII, the Directors may prescribe, in
their absolute discretion, such other bases and times for determining the net
income and net assets of the Company and of each class as they may deem
necessary or desirable to enable the Company to comply with any provision of the
1940 Act, any rule or regulation thereunder, or any order of exemption issued by
said Commission, all as in effect now or hereafter amended or modified.
ARTICLE VIII
LIABILITY FOR COMPANY OBLIGATIONS; FIDUCIARY DUTIES
Section 8.1. No Personal Liability of Directors, etc.
(a) Directors. The Directors shall be entitled to the protection
against personal liability for the obligations of the Company under
Section 18-303(a) of the Act. No Director shall be liable to the Company,
its Holders, or to any Director, officer, employee, or agent there of for
any action or failure to act (including, without limitation, the failure
to compel in any way any former or acting Director to redresss any breach
of trust) except for his own bad faith, willful misfeasance, gross
negligence or reckless disregard of his duties.
(b) Officers, Employees or Agents of the Company. The officers,
employees and agents of the Company shall not be subject to any personal
liability whatsoever in his or her official or individual capacity to any
Person (other than as provided in the following sentence). No officer,
employee or agent of the Company shall be liable to the Company, its
Holders, or to any Director, officer, employee, or agent thereof for any
action or failure to act(including, without limitation, the failure to
compel in any way any former or acting Director to redress any breach of
trust) except for his own bad faith, willful misfeasance, gross negligence
or reckless disregard of his duties.
(c) The provisions of this Declaration, to the extent that they
expand or restrict the duties and liabilities of the Trustees, officers,
employees or agents of the Trust otherwise existing at law or in equity,
are agreed by the Holders to modify to that extent such other duties and
liabilities.
Section 8.2. Indemnification. The Company shall indemnify each of its
Directors, officers, employees, and agents (including persons who serve at its
request as
15
directors, managers, officers or trustees of another organization in which it
has any interest, as a shareholder, creditor or otherwise) against all
liabilities and expenses (including amounts paid in satisfaction of judgments,
in compromise, as fines and penalties, and as counsel fees) reasonably incurred
by him in connection with the defense or disposition of any action, suit or
other proceeding, whether civil or criminal, in which he may be involved or with
which he may be threatened, while in office or thereafter, by reason of his
being or having been such a Director, officer, employee or agent, except with
respect to any matter as to which he shall have been adjudicated to have acted
in bad faith, willful misfeasance, gross negligence or reckless disregard of his
duties; provided, however, that as to any matter disposed of by a compromise
payment by such Person, pursuant to a consent decree or otherwise, no
indemnification either for said payment or for any other expenses shall be
provided unless there has been a determination that such Person did not engage
in willful misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of his office by the court or other body
approving the settlement or other disposition or, in the absence of a judicial
determination, by a reasonable determination, based upon a review of readily
available facts (as opposed to a full trial-type inquiry), that he did not
engage in such conduct, which determination shall be made by a majority of a
quorum of Directors who are neither Interested Persons of the Company nor
parties to the action, suit or proceeding, or by written opinion from
independent legal counsel approved by the Directors. The rights accruing to any
Person under these provisions shall not exclude any other right to which he may
be lawfully entitled; provided that no Person may satisfy any right of indemnity
or reimbursement granted herein or to which he may be otherwise entitled except
out of the Company Property. The Directors may make advance payments in
connection with indemnification under this Section 8.2; provided that any
advance payment of expenses by the Company to any Director, officer, employee or
agent shall be made only upon the undertaking by such Director, officer,
employee or agent to repay the advance unless it is ultimately determined that
he is entitled to indemnification as above provided, and only if one of the
following conditions is met:
(a) the Director, officer, employee or agent to be indemnified
provides a security for his undertaking; or
(b) the Company shall be insured against losses arising by reason of
any lawful advances; or
(c) there is a determination, based on a review of readily available
facts, that there is reason to believe that the Director, officer,
employee or agent to be indemnified ultimately will be entitled to
indemnification, which determination shall be made by:
(i) a majority of a quorum of Directors who are neither
Interested Persons of the Company nor parties to the Proceedings; or
(ii) an independent legal counsel in a written opinion.
Section 8.3. No Protection Against Certain 1940 Act Liabilities. Nothing
contained in Section 8.1 or Section 8.2 hereof shall protect any Director or
officer of the Company from any liability to the Company or its Holders to which
he would otherwise be
16
subject by reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of his office. Nothing
contained in Section 8.1 or Section 8.2 hereof or in any agreement of the
character described in Section 4.1 or Section 4.2 hereof shall protect any
Investment Adviser to the Company against any liability to the Company to which
he or it would otherwise be subject by reason of willful misfeasance, bad faith,
or gross negligence in the performance of his or its duties to the Company, or
by reason of his or its reckless disregard to his or its obligations and duties
under the agreement pursuant to which he or it serves as Investment Adviser to
the Company.
Section 8.4. No Bond Required of Directors. No Director shall be obligated
to give any bond or other security for the performance of any of his duties
hereunder.
Section 8.5. No Duty of Investigation; Notice in Company Instruments, etc.
No purchaser, lender, seller or other Person dealing with the Directors or with
any officer, employee or agent of the Company shall be bound to make any inquiry
concerning the validity of any transaction purporting to be made by the
Directors or by said officer, employee or agent or be liable for the application
of money or property paid, lent or delivered to or on the order of the Directors
or of said officer, employee or agent. Every contract, undertaking, instrument,
certificate, interest or obligation or other security of the Company, and every
other act or thing whatsoever executed in connection with the Company, shall be
conclusively presumed to have been executed or done by the executors thereof
only in their capacity as Directors under this Agreement or in their capacity as
officers, employees or agents of the Company. Every written obligation,
contract, instrument, certificate or other interest or undertaking of the
Company made or sold by the Directors or by any officer, employee or agent of
the Company, in his capacity as such, may contain an appropriate recital to the
effect that the Holders, Directors, officers, employees and agents of the
Company 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 Agreement,
and may contain any further recital that they may deem appropriate, but the
omission of such recital shall not operate to impose personal liability on any
of the Holders, Directors, officers, employees or agents of the Company.
Section 8.6. Insurance. The Directors may maintain insurance for the
protection of the Company Property, its Holders, Directors, officers, employees
and agents in such amount as the Directors shall deem adequate to cover possible
tort liability, and such other insurance as the Directors in their sole judgment
shall deem advisable.
Section 8.7. Reliance on Experts, etc. Each Director, officer or employee
of the Company shall, in the performance of his 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
Company, upon an opinion of counsel, or upon reports made to the Company by any
of its officers or employees or by any Investment Adviser, the Administrator,
accountant, appraiser or other expert or consultant selected with reasonable
care by the Directors, officers or employees of the Company, regardless of
whether such counsel or expert may also be a Director; provided that nothing in
this Section shall be deemed to exonerate the Directors from their duties of
reasonable care, diligence and prudence or any other duties imposed by the 1940
Act.
17
Section 8.8. Accounting. The Directors shall not be required to file any
inventory or accounting with any court or officer of any court, unless
specifically ordered to do so on the application of the Directors or on the
application of the Holders of Interests of the Company, or on the court's own
motion.
ARTICLE IX
HOLDERS
Section 9.1. Meetings of Holders. Meetings of the Holders may be called at
any time by a majority of the Directors and shall be called by any Director upon
written request of Holders holding, in the aggregate, not less than 10% of the
Interests of the Company, such request specifying the purpose or purposes for
which such meeting is to be called. Any such meeting shall be held within or
without the State of Delaware on such day and at such time as the Directors
shall designate. Holders of at least one-third of the Interests of the Company,
present in person or by proxy, shall constitute a quorum for the transaction of
any business, except as may otherwise be required by the 1940 Act or other
applicable law or by this Agreement or the By-Laws of the Company. If a quorum
is present at a meeting, an affirmative vote by the Holders present, in person
or by proxy, holding more than 50% of the total Interests of the Holders
present, either in person or by proxy, at such meeting constitutes the action of
the Holders, unless the 1940 Act, other applicable law, this Agreement including
the By-Laws of the Company require a greater number of affirmative votes.
Section 9.2. Notice of Meetings. Notice of all meetings of the Holders
stating the time, place and purposes of the meeting, shall be given by the
Directors by mail to each Holder of the Company, as the case may be, at his
registered address or transmitted to the Holders by any other method permitted
by law, sent at least 10 days and not more than 90 days before the meeting. At
any such meeting, any business properly before the meeting may be considered
whether or not stated in the notice of the meeting. Any adjourned meeting may be
held as adjourned without further notice.
Section 9.3. Record Date for Meetings. For the purpose of determining
Holders who are entitled to notice of and to vote at any meeting, or to
participate in any distribution, or for the purpose of any other action, the
Directors may from time to time fix a date, not more than 90 days prior to the
date of any meeting of the Holders or payment of distributions or other action,
as the case may be, as a record date for the determination of the Persons to be
treated as Holders of record of the Company for such purposes.
Section 9.4. Proxies, etc. At any meeting of Holders, any Holder 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 Company 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 Directors, proxies may be solicited in the name
of one or more Directors or one or more of the officers of the Company. Only
Holders of record shall be entitled to vote. Each Holder shall be entitled to
vote proportionate to his Interest in the Trust. When Interests are held jointly
by several persons, any one of them may vote at any meeting in person or by
proxy in respect of such Interest, but if more than one of them shall be
18
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 Interest. A proxy purporting to be executed by or on
behalf of a Holder 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 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 his Interest, 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.
Section 9.5. Reports. The Directors shall cause to be prepared, at least
annually, a report of operations containing a balance sheet and statement of
income and undistributed income of the Company prepared in conformity with
generally accepted accounting principles and an opinion of an independent public
accountant on such financial statements. The Directors shall, in addition,
furnish to the Holders at least semi-annually interim reports containing an
unaudited balance sheet as of the end of such period and an unaudited statement
of income and surplus for the period from the beginning of the current fiscal
year to the end of such period.
Section 9.6. Inspection of Records. The records of the Company shall be
open to inspection by Holders during normal business hours for any purpose not
harmful to the Company.
Section 9.7. Holder Action by Written Consent. Any action that may be
taken by Holders may be taken without a meeting if Holders holding more than 50%
of the total Interests entitled to vote (or such larger proportion thereof as
shall be required by any express provision of this Agreement) shall consent to
the action in writing or by any other method permitted by law and evidence of
the consents are filed with the records of the meetings of Holders. Such consent
shall be treated for all purposes as a vote taken at a meeting of Holders.
ARTICLE X
DURATION; DISSOLUTION OF
COMPANY; AMENDMENT; MERGERS; ETC.
Section 10.1. Duration. Subject to possible dissolution in accordance with
Section 10.2, the Company created hereby shall have perpetual existence. A
termination of a Series shall not, in and of itself, dissolve the Company or
cause the termination of any other Series.
Section 10.2. Dissolution of Company. The Company shall be dissolved by
(i) a resolution adopted by a majority of the Directors followed by notice of
dissolution to the Holders of the Interests in the Company, (ii) the termination
of the legal existence of the last remaining member of the Company or the
occurrence of any other event which terminates the continued membership of the
last remaining member of the Company in the Company unless the Company is
continued without dissolution in a manner permitted by the Act, or (iii) a
decree of judicial dissolution under Section 18-802 of the Act.
19
Section 10.3. Actions Upon Dissolution.
(a) Upon an event of dissolution of the Company, the affairs of the
Company shall be wound-up in accordance with the following provisions:
(i) The Company shall thereafter carry on no business except
for the purpose of winding up its affairs.
(ii) The Directors shall proceed to wind up the affairs of the
Company and all of the powers of the Directors under this Agreement
shall continue until the affairs of the Company shall have been
wound up, including the power to fulfill or discharge the contracts
of the Company, collect its assets, sell, convey, assign, exchange,
transfer or otherwise dispose of all or any part of the remaining
Company Property to one or more persons at public or private sale
for consideration that may consist in whole or in part of cash,
securities or other property of any kind, discharge or pay its
liabilities, and to do all other acts appropriate to liquidate its
business; provided that any sale, conveyance, assignment, exchange,
transfer or other disposition of all or substantially all of the
Company Property other than for cash, shall require approval of the
principal terms of the transaction and the nature and amount of the
consideration by the vote at a meeting, or by written consent, of
Holders holding more than 50% of the total outstanding Interests of
the Company entitled to vote.
(iii) After paying (or making reasonable provision for the
payment of) all liabilities and upon receipt of such releases,
indemnities and refunding agreements as they deem necessary for
their protection, the Directors may distribute the remaining Company
Property, in cash or in kind or partly each, among the Holders
according to their Book Capital Accounts.
(b) Upon the completion of winding up of the Company's affairs as
provided herein, the Directors shall file a certificate of cancellation in
accordance with the Act and such Directors shall, subject to the Act
thereupon be discharged from all further liabilities and duties hereunder,
and the rights and interests of all Holders shall thereupon cease.
Section 10.4. Amendment Procedure.
(a) Two-thirds (2/3) of the Directors then in office may amend this
Agreement at any time for any purpose without the approval of the Holders
of Interests; provided, that the vote or a written or other legally
permissible form of consent of Holders holding more than 50% of the total
outstanding Interests or of Holders of 67% or more of the Interests voting
or consenting, if Holders of at least 50% of such Interests vote or
consent, shall be necessary to approve any amendment whenever such vote or
consent is required under the 1940 Act.
20
(i) Nothing contained in this Agreement shall permit the
amendment of this Agreement to impair the exemption from personal
liability of Holders, Directors, officers, employees and agents of
the Company.
(ii) A certificate signed by a Director or by the Secretary or
any Assistant Secretary of the Company, setting forth an amendment
and reciting that it was duly adopted by the Holders or by the
Directors as aforesaid or a copy of the Agreement, as amended,
certified by a Director or the Secretary or any Assistant Secretary
of the Company, certifying that such Agreement is a true and correct
copy of the Agreement as amended, shall be conclusive evidence of
such amendment when lodged among the records of the Company.
Section 10.5. Merger, Consolidation, Conversion and Sale of Assets.
(a) The Company may convert or merge into or consolidate with any
corporation, association, other limited liability company or other
organization or the Company thereof may sell, lease or exchange all or
substantially all of the Company Property including its good will, upon
such terms and conditions and for such consideration when and as
authorized by vote or written or other legally permissible form of consent
of two-thirds (2/3) of the Directors then in office, without any vote or
approval of any other Person (including any Holder). In accordance with
Section 18-209 of the Act, an agreement of merger or consolidation may
effect any amendment to this Agreement or the By-Laws or effect the
adoption of a new limited liability company agreement or by-laws of the
Company if the Company is the surviving or resulting entity.
(b) The Directors may cause to be organized or assist in organizing
a corporation or corporations under the laws of any jurisdiction or any
other limited liability company, trust, partnership, association or other
organization to take over all of the Company Property, or to carry on any
business in which the Company shall directly or indirectly have any
interest, and to sell, convey and transfer the Company Property to any
such corporation, trust, association or organization in exchange for the
equity interests thereof or otherwise, and to lend money to, subscribe for
the equity interests of, and enter into any contracts with any such
corporation, limited liability company, trust, partnership, association or
organization, or any corporation, partnership, limited liability company,
trust, association or organization in which the Company holds or is about
to acquire equity interests. The Directors may also cause a merger or
consolidation between the Company or any successor thereto and any such
corporation, trust, partnership, 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 the
Holders for the Directors to organize or assist in organizing one or more
corporations, trusts, partnerships, associations or other organizations
and selling, conveying or transferring a portion of the Company Property
to such organizations or entities.
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ARTICLE XI
MISCELLANEOUS
Section 11.1. Registered Agent. The registered office of the Company is
c/o The Corporation Trust Company, 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, XX 00000 and
the registered agent of the Company at such address is The Corporation Trust
Company.
Section 11.2. Governing Law. This Agreement is executed by all of the
Directors and delivered with reference to Act and the laws of the State of
Delaware, and the rights of all parties and the validity and construction of
every provision hereof shall be governed by, subject to and construed according
to the Act and the laws of the State of Delaware (unless and to the extent
otherwise provided for and/or preempted by the 1940 Act or other applicable
federal securities laws).
Section 11.3. Reliance by Third Parties. Any certificate executed by an
individual who, according to the records of the Company, appears to be a
Director hereunder, or Secretary, Assistant Secretary, Treasurer or Assistant
Treasurer of the Company, certifying to: (a) the number or identity of Directors
or Holders, (b) the due authorization of the execution of any instrument or
writing, (c) the form of any vote passed at a meeting of Directors or Holders,
(d) the fact that the number of Directors or Holders present at any meeting or
executing any written instrument satisfies the requirements of this Agreement,
(e) the form of any By-Laws adopted by or the identity of any officers elected
by the Directors, or (f) the existence of any fact or facts that in any manner
relate to the affairs of the Company, shall be conclusive evidence as to the
matters so certified in favor of any Person dealing with the Directors and their
successors.
Section 11.4. Provisions in Conflict with Law or Regulations.
(a) The provisions of this Agreement are severable, and if the
Directors 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, the Act or, consistent with Section 11.2,
any other applicable Delaware law regarding administration of trusts, or
with other applicable laws and regulations, the conflicting provisions
shall be deemed superseded by such law or regulation to the extent
necessary to eliminate such conflict; provided, however, that such
determination shall not affect any of the remaining provisions of this
Agreement or render invalid or improper any action taken or omitted prior
to such determination.
(b) If any provision of this Agreement shall be held invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability
shall pertain 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 Agreement in any jurisdiction.
Section 11.5. Company Only. It is the intention of the Directors to create
only a limited liability company under the Act with the relationship of manager
and member between
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the Directors and each Holder from time to time. It is not the intention of the
Directors to create a general partnership, limited partnership, joint stock
association, corporation, bailment, or any form of legal relationship other than
a Delaware limited liability company except to the extent such limited liability
company is deemed to constitute a partnership under the Code and applicable
state tax laws. Nothing in this Agreement shall be construed to make the
Holders, either by themselves or with the Directors, partners or members of a
joint stock association.
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