As filed with the Securities and Exchange Commission on August 30, 1996
1940 Act File No. 811-2589
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER
THE INVESTMENT COMPANY ACT OF 1940 X
Amendment No. 19 X
EATON VANCE SERIES TRUST
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(Exact Name of Registrant as Specified in Charter)
24 Federal Street, Boston, Massachusetts 02110
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(Address of Principal Executive Offices)
(617) 482-8260
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(Registrant's Telephone Number including Area Code)
THOMAS OTIS, Secretary
24 Federal Street, Boston, Massachusetts 02110
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(Name and address of agent for service)
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ADOPTION OF REGISTRATION STATEMENT
The Registrant hereby adopts as its own the Registration Statement (File
No. 811-2589) of Vance, Sanders Exchange Fund (a California Limited
Partnership), as amended.
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PART A
INFORMATION REQUIRED IN A PROSPECTUS
Responses to Items 1, 2, 3 and 5A have been omitted pursuant to Paragraph 4
of Instruction F of the General Instructions to Form N-1A.
Item 4. General Description of Registrant
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(a) (i) The Registrant is an open-end diversified management investment
company organized on June 24, 1996, as a business trust under the laws of the
Commonwealth of Massachusetts. The Registrant has established and designated
seven separate series of shares. This registration statement relates to the
series designated Vance Sanders Exchange Fund (the "Fund"). The Fund is the
successor to Vance, Sanders Exchange Fund (a California Limited Partnership)
(the "Partnership") which commenced operations in 1975. Shares of the Fund are
not currently offered for sale.
(ii) The investment objective of the Fund is to achieve long-term,
after-tax returns for its shareholders through investing in a diversified
portfolio of equity securities. This objective is nonfundamental but the
Trustees intend to submit any proposed change which would be material to
shareholders for approval.
Prior to September 3, 1996, the Fund invested directly in a portfolio of
securities. Information provided herein for prior periods reflects this
investment practice. Commencing on September 3, 1996, the Fund seeks to achieve
its investment objective by investing in Tax-Managed Growth Portfolio (the
"Portfolio") (File No. 811-7409). The Fund and the Portfolio have the same
investment policies and restrictions, and, therefore, the Registrant
incorporates by reference the items identified herein of the Portfolio's
Registration Statement under the Investment Company Act of 1940 (the "1940 Act")
on Form N-1A as previously filed electronically with the Securities and Exchange
Commission (the "Commission") on November 2, 1995 (Accession No.
0000898432-95-000362).
(b) and (c) The Registrant incorporates herein by reference the information
set forth under Item 4 of the Registration Statement of the Portfolio.
Item 5. Management of the Fund
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(a) The Board of Trustees has overall responsibility for management of the
Registrant.
(b) and (c) The Registrant incorporates herein by reference the information
set forth under Item 5 of the Registration Statement of the Portfolio.
(d) Eaton Vance Management ("Eaton Vance" or the "Administrator") acts as
Administrator of the Fund, but currently receives no compensation for providing
administrative services to the Fund. Under its agreement with the Registrant,
Eaton Vance has been engaged to administer the Fund's affairs, subject to the
supervision of the Board of Trustees, and shall furnish for the use of the Fund
office space and all necessary office facilities, equipment and personnel for
administering the affairs of the Fund.
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(e) The transfer and dividend disbursing agent is First Data Investor
Services Group, P.O. Box 5123, Westborough, MA 01581-5123 (the "Transfer
Agent").
(f) The Fund's ratio of expenses to average net assets for the fiscal year
ended December 31, 1995 was 0.70%.
(g) Not applicable
Item 6. Capital Stock and Other Securities
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(a)(i), (ii) and (iii) The Registrant may issue an unlimited number of
shares of beneficial interest (no par value per share) in one or more series
(such as the Fund). Each share of the Fund represents an equal proportionate
beneficial interest in the Fund. When issued and outstanding, the shares are
fully paid and nonassessable by the Trust. Shareholders are entitled to one vote
for each full share held. Fractional shares may be voted proportionately. Shares
have no preemptive or conversion rights and are freely transferable. In the
event of the liquidation of the Fund, shareholders are entitled to share pro
rata in the net assets of the Fund available for distribution to shareholders.
In addition, whenever the Registrant on behalf of the Fund as an investor in the
Portfolio is requested to vote on matters pertaining to the Portfolio (other
than the termination of the Portfolio's business, which may be determined by the
Trustees of the Portfolio without investor approval), the Fund will hold a
meeting of shareholders and will vote its interest in the Portfolio for or
against such matters proportionately to the instructions to vote for or against
such matters received from shareholders. The Fund shall vote shares for which it
receives no voting instructions in the same proportion as the shares for which
it receives voting instructions. Other investors in the Portfolio may alone or
collectively acquire sufficient voting interests in the Portfolio to control
matters relating to the operation of the Portfolio, which may require the Fund
to withdraw its investment in the Portfolio or take other appropriate action.
(b) Not applicable
(c) Not applicable
(d) Not applicable
(e) Shareholder inquiries should be forwarded to the Registrant's office at
24 Federal Street, Boston, Massachusetts 02110.
(f) Distributions from net investment income are paid at least quarterly.
These distributions are paid in shares of the Fund computed at net asset value,
subject to an option to each shareholder to elect to be paid in cash. Net
realized long-term capital gains are retained by the Fund as described below.
(g)(i) Since the Fund intends to distribute substantially all of its net
investment income to shareholders, it is not expected that the Fund will be
required to pay any federal income taxes on such income. However, shareholders
of the Fund normally will have to pay federal income taxes and any state or
local taxes, on distributions from investment income.
(ii) Since the Fund retains any allocated net realized long-term capital
gain and pays the federal tax thereon, shareholders include in their personal
federal income tax return their proportionate share of such gains, take a credit
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for the payment of taxes thereon and increase the tax cost basis of their
shares by an amount equal to such gains less the taxes paid. The Fund provides
each shareholder with information regarding the shareholder's federal income tax
treatment of any undistributed realized long-term capital gain retained by the
Fund.
(iii) After the end of each calendar year, each shareholder receives
information for tax purposes regarding the distributions paid during the year
and the amount of any distributions eligible for the dividends received
deduction for corporations.
(h) The Fund, unlike mutual funds which directly acquire and manage their
own portfolios of securities, seeks to achieve its investment objective by
investing its assets in an interest in the Portfolio, which is a separate
investment company with an identical investment objective (although the Fund may
temporarily hold a de minimis amount of cash). Therefore, the Fund's interest in
the securities owned by the Portfolio is indirect. In addition to selling an
interest to the Fund, the Portfolio may sell interests to other affiliated and
non-affiliated mutual funds or institutional investors. Such investors will
invest in the Portfolio on the same terms and conditions and will pay a
proportionate share of the Portfolio's expenses. The Fund may withdraw
(completely redeem) all its assets from the Portfolio at any time if the Board
of Trustees of the Registrant determines that it is in the best interest of the
Fund to do so. The investment objective and the nonfundamental investment
policies of the Fund and the Portfolio may be changed by the Trustees of the
Registrant and the Trustees of the Portfolio without obtaining the approval of
the shareholders of the Registrant or the investors in the Portfolio, as the
case may be. Any such change of the investment objective will be preceded by
thirty days' advance written notice to the shareholders of the Fund or the
investors in the Portfolio, as the case may be. In the event the Fund withdraws
all of its assets from the Portfolio, or the Board of Trustees of the Registrant
determines that the investment objective of the Portfolio is no longer
consistent with the investment objective of the Fund, such Trustees would
consider what action might be taken, including investing the assets of the Fund
in another pooled investment entity or retaining an investment adviser to manage
the Fund's assets in accordance with its investment objective. The Fund's
investment performance may be affected by a withdrawal of all its assets from
the Portfolio.
Smaller investors in the Portfolio may be adversely affected by the actions
of a larger investor in the Portfolio. For example, if a large investor
withdraws from the Portfolio, the remaining investors may experience higher pro
rata operating expenses, thereby producing lower returns. Additionally, the
Portfolio may become less diverse, resulting in increased portfolio risk, and
experience decreasing economies of scale. However, this possibility exists as
well for historically structured funds which have large or institutional
investors. Until 1992, the Administrator sponsored and advised historically
structured funds. Funds which invest all their assets in interests in a separate
investment company are a relatively new development in the mutual fund industry
and, therefore, the Fund may be subject to additional regulations than
historically structured funds.
The Declaration of Trust of the Portfolio provides that the Portfolio will
terminate 120 days after the complete withdrawal of the Fund or any other
investor in the Portfolio, unless either the remaining investors, by a majority
vote at a meeting of such investors, or a majority of the Trustees of the
Portfolio, by written instrument consented to by a majority of its investors,
agree to continue the business of the Portfolio. This provision is consistent
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with treatment of the Portfolio as a partnership for federal income tax
purposes.
Item 7. Purchase of Securities Being Offered
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Not applicable. Registrant does not offer its shares for sale.
Item 8. Redemption or Repurchase of Registrant's Shares
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A shareholder has the right to redeem Fund shares by delivering to the
Transfer Agent during its business hours a written request in good order plus
any share certificates, or stock powers if no certificates have been issued.
Redemption will be made at the net asset value next computed after such
delivery. Good order means that all relevant documents must be endorsed by the
record owner(s) exactly as the shares are registered and the signature(s) must
be guaranteed by a member of either the Securities Transfer Association's STAMP
program or the New York Stock Exchange's Medallion Signature Program, or certain
banks, savings and loan institutions, credit unions, securities dealers,
securities exchanges, clearing agencies and registered securities associations
as required by a regulation of the Securities and Exchange Commission (the
"Commission") acceptable to the Transfer Agent. In addition, in some cases, good
order may require the furnishing of additional documentation if shares are
registered in the name of a corporation, partnership or fiduciary. Payment will
be made within seven days of the receipt of the aforementioned documents.
In addition to the redemption of shares in the manner described above, the
Registrant, for the convenience of its shareholders, has authorized Eaton Vance
to act as its agent in the repurchase of Fund shares. Eaton Vance will normally
accept orders to repurchase shares by wire or telephone from investment dealers
for their customers at the net asset value next computed after receipt of the
order by the dealer if such order is received by Eaton Vance prior to its close
of business that day. It is the dealer's responsibility to transmit promptly the
repurchase order to Eaton Vance. These repurchase arrangements do not involve a
charge to the shareholder by either the Registrant or its agent; however,
investment dealers may make a charge to the shareholder. Payment will be made
within seven days of the receipt of an order to repurchase provided that the
certificates, or a stock power if no certificates have been issued, have been
delivered to the Transfer Agent in good order as described above.
The Registrant reserves the right to pay the redemption or repurchase price
of Fund shares in whole or in part by a distribution of portfolio securities in
lieu of cash if, in the opinion of management, it seems advisable to do so;
normally, when the redemption or repurchase price equals or exceeds $2,500
portfolio securities will be used by the Registrant. Any portfolio securities so
distributed will be valued at the figure at which they were appraised in
computing the net asset value of Fund's shares. If the portfolio securities so
distributed are sold by the redeeming shareholder he will incur brokerage
commissions or other transaction costs in connection with such sale.
The right to redeem shares of the Fund can be suspended and the payment of
the redemption price deferred when the Exchange is closed (other than for
customary weekend and holiday closings), during periods when trading on the
Exchange is restricted as determined by the Commission, or during any emergency
as determined by the Commission which makes it impracticable for the Portfolio
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or the Fund to dispose of its securities or value its assets, or during any
other period permitted by order of the Commission for the protection of
investors.
The Fund values its shares once on each day the New York Stock Exchange (the
"Exchange") is open for trading, as of the close of regular trading on the
Exchange (normally 4:00 p.m. New York time). The Fund's net asset value per
share is determined by its custodian, Investors Bank & Trust Company ("IBT"),
(as agent for the Fund) in the manner authorized by the Trustees of the Trust.
Net asset value is computed by dividing the value of the Fund's total assets,
less its liabilities, by the number of Fund shares outstanding. Because the Fund
invests its assets in an interest in the Portfolio, the Fund's net asset value
will reflect the value of its interest in the Portfolio (which, in turn,
reflects the underlying value of the Portfolio's assets and liabilities).
The Portfolio's net asset value is also determined as of the close of regular
trading on the Exchange by IBT (as custodian and agent for the Portfolio) based
on market or fair value in the manner authorized by the Trustees of the
Portfolio. Net asset value is computed by subtracting the liabilities of the
Portfolio from the value of its total assets. Securities listed on securities
exchanges or in the NASDAQ National Market are valued at closing sales prices.
Item 9. Pending Legal Proceeding
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Not applicable
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PART B
INFORMATION REQUIRED IN A STATEMENT OF ADDITIONAL INFORMATION
Item 10. Cover Page
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Not applicable
Item 11. Table of Contents
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Not applicable
Item 12. General Information and History
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The assets of the Partnership are being transferred to the Fund in exchange
for shares of the Fund on August 30, 1996. The other six series of the Trust
(which have not yet commenced operations) are Capital Exchange Fund, Depositors
Fund of Boston, Diversification Fund, The Exchange Fund of Boston, Fiduciary
Exchange Fund and Second Fiduciary Exchange Fund.
Item 13. Investment Objectives and Policies
(a) - (c) The Registrant incorporates herein by reference the information
set forth under Item 13 of the Registration Statement of the Portfolio.
(d) Not applicable
Item 14. Management of the Registrant
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The Trustees and officers of the Registrant and the Portfolio are listed
below. Except as indicated, each individual has held the office shown or other
offices in the same company for the last five years. Unless otherwise noted, the
business address of each Trustee and officer is 24 Federal Street, Boston,
Massachusetts, 02110, which is also the address of the Portfolio's investment
adviser, Boston Management and Research ("BMR"), a wholly-owned subsidiary of
Eaton Vance Management ("Eaton Vance"); Eaton Vance's parent, Eaton Vance Corp.
("EVC"); and of Eaton Vance's and BMR's Trustee, Eaton Vance, Inc. ("EV"). Eaton
Vance and EV are both wholly-owned subsidiaries of EVC. Those Trustees who are
"interested persons" of the Registrant, Eaton Vance, BMR, EVC, or EV as defined
in the 1940 Act, by virtue of their affiliation with or stockholdings of any one
or more of, the Registrant, Eaton Vance, BMR, EVC or EV are indicated by an
asterisk(*). All of the officers and Trustees listed below are also officers,
Directors or Trustees of various investment companies managed by Eaton Vance or
BMR.
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(1) (2) (3)
Position Held
with Registrant/ Principal Occupations
Name (Age) and Address Portfolio during Past 5 Years
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Landon T. Clay(70)* President & Chairman of the Board and
Trustee Director of EVC and EV;
Chairman, Eaton Vance
and BMR.
Donald R. Dwight(65) Trustee President Dwight Partners,
Clover Mill Lane Inc. (since 1988) (a
Lyme, New Hampshire 03468 corporate relations and
communications company);
Chairman of the Board of
Newspapers of New England,
Inc. (since 1983).
Samuel L. Hayes, III(61) Trustee Jacob H. Schiff Professor
Harvard Graduate School of of Investment Banking,
Business Administration Harvard University
Soldier Field Road Graduate School of
Boston, Massachusetts 02163 Business Administration.
Norton H. Reamer (60) Trustee President and Director,
One International Place United Asset Management
Boston, Massachusetts 02110 Corporation, (a holding,
company owning
institutional investment
management firms);
Chairman, President and
Director, UAM Funds
(mutual funds).
John L. Thorndike (69) Trustee Director, Fiduciary
175 Federal Street Company Incorporated.
Boston, Massachusetts 02110
Jack L. Treynor (66) Trustee Investment Adviser and
504 Via Almar Consultant.
Palos Verdes Estates,
California 90274
James B. Hawkes (54) Vice President Executive Vice President
and Director, EVC and EV;
Executive Vice President
of Eaton Vance and BMR.
Duncan W. Richardson(38) Vice President of Vice President, Eaton
the Portfolio Vance, EV and BMR.
Thomas Otis(64) Secretary Vice President and
Secretary, EVC, Eaton
Vance, EV and BMR.
James L. O'Connor(51) Treasurer Vice President, Eaton
Vance, EV and BMR.
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Janet E. Sanders(60) Assistant Treasurer Vice President, Eaton
& Assistant Vance, EV and BMR.
Secretary
M. Katherine Kreider(35) Assistant Treasurer Assistant Vice
(since 2/21/96) President, Eaton Vance,
BMR and EV (since
2/5/96); Senior Audit
Manager and Audit
Manager Financial
Services Industry
Practice with Deloitte
& Touche LLP (1987 to
1996).
A. John Murphy (33) Assistant Secretary Assistant Vice
(since 3/27/95) President, Eaton Vance,
BMR and EV (since
3/1/94); employee of
Eaton Vance (since
March 1993); State
Regulations Supervisor,
The Boston Company
(1991-1993);
Registration
Specialist, Fidelity
Management & Research
Co. (1986-1991).
Eric G. Woodbury (39) Assistant Secretary Vice President of Eaton
(since 6/19/95) Vance, BMR and EV and
employee of Eaton Vance
(since February, 1993);
formerly, associate
attorney at Dechert,
Price & Rhoads.
Messrs. Thorndike (Chairman), Hayes and Reamer are members of the Special
Committee of the Boards of Trustees of the Registrant and the Portfolio. The
purpose of the Special Committee is to consider, evaluate and make
recommendations to the full Board concerning (i) all contractual arrangements
with service providers to the Registrant, including administrative services,
transfer agency, custodial and fund accounting and distribution services, and
(ii) all other matters in which Eaton Vance or its affiliates has any actual or
potential conflict of interest with the Registrant or its shareholders.
The Nominating Committee is comprised of four Board members who are not
"interested persons" as that term is defined under the Investment Company Act of
1940 ("noninterested Trustees"). The Committee has four-year staggered terms,
with one member rotating off the Committee to be replaced by another
noninterested Trustee of the Registrant. The purpose of the Committee is to
recommend to the Board nominees for the position of noninterested Trustee and to
assure that at least a majority of the Board is independent of Eaton Vance and
its affiliates.
Messrs. Treynor (Chairman) and Dwight are members of the Audit Committee of
the Boards of Trustees of the Registrant and the Portfolio. The Audit
Committee's functions include making recommendations to the Board regarding the
selection of the independent public accountants, and reviewing with such
accountants and the Treasurer of the Registrant and the Portfolio matters
relative to trading and brokerage policies and practices, accounting and
auditing practices and procedures, accounting records, internal accounting
controls, and the functions performed by the custodian, transfer agent and
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dividend disbursing agent of the Registrant and the Portfolio.
(c) The fees and expenses of those Trustees of the Registrant and the
Portfolio who are not members of the Eaton Vance organization (noninterested
Trustees) are paid by the Registrant and the Portfolio, respectively. (The
Trustees of the Registrant and the Portfolio who are members of the Eaton Vance
organization receive no compensation from the Registrant or the Portfolio.) For
the fiscal year ended October 31, 1996, it is estimated that the noninterested
Trustees of the Registrant and the Portfolio will earn the following
compensation in their capacities as Trustees from the Fund. During the one-year
period ended March 31, 1996, the noninterested Trustees of the Registrant and
the Portfolio earned the following compensation in their capacities as Directors
and/or Trustees from the funds in the Eaton Vance fund complex(1):
Estimated Estimated Total Compensation
Aggregate Aggregate from Registrant
Name from Fund from Portfolio and Fund Complex
Donald R.
Dwight $ 160 $ 1,200 $137,500(2)
Samuel L.
Hayes, III 160 1,200 153,750(3)
Norton H.
Reamer 160 1,200 137,500
John L.
Thorndike 160 1,200 142,500
Jack L.
Treynor 160 1,200 142,500
(1) The Eaton Vance fund complex consists of 219 registered investment
companies or series thereof.
(2) Includes $35,313 of deferred compensation.
(3) Includes $37,500 of deferred compensation.
Trustees of the Portfolio that are not affiliated with the investment
adviser, BMR, may elect to defer receipt of all or a percentage of their annual
fees in accordance with the terms of a Trustees Deferred Compensation Plan (the
"Plan"). Under the Plan, an eligible Trustee may elect to have his deferred fees
invested by the Portfolio in the shares of one or more funds in the Eaton Vance
Family of Funds, and the amount paid to the Trustees under the Plan will be
determined based upon the performance of such investments. Deferral of Trustees'
fees in accordance with the Plan will have a negligible effect on the
Portfolio's assets, liabilities, and net income, and will not obligate the
Portfolio to retain the services of any Trustee or obligate the Portfolio to pay
any particular level of compensation to the Trustee. Neither the Registrant nor
the Portfolio has a retirement plan for Trustees.
Item 15. Control Persons and Principal Holders of Securities
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(a) Not applicable
(b) As of July 31, 1996, the Trustees and officers of the Registrant, as a
group, owned in the aggregate less than 1% of the outstanding shares of the
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Fund. To the knowledge of the Registrant no person of record or
beneficially owned 5% or more of Fund shares, except the following shareholders
who owned of record the approximate percentage of outstanding shares indicated
after their names as of July 31, 1996: Kathleen L. McCarthy and J. Thomas
McCarthy, Trustees of the McCarthy Revocable Trust u/a dtd. 4/7/95, Los Angeles,
CA (5.8%). To the Fund's knowledge, no other person owned of record or
beneficially 5% or more of the Fund's outstanding shares as of such date.
Item 16. Investment Advisory and Other Services
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(a) - (c) The Registrant incorporates the information set forth under Item
16 of the Registration Statement of the Portfolio herein by reference.
The management fees paid by the Registrant for the fiscal years ended
December 31, 1995, 1994 and 1993 were $1,266,428, $1,096,383 and $1,126,388,
respectively.
(d) - (g) Not applicable.
(h) and (i) Investors Bank & Trust Company ("IBT"), 89 South Street,
Boston, Massachusetts, acts as custodian for the Registrant and the Portfolio.
IBT has custody of all cash and securities representing the Fund's interest in
the Portfolio, has custody of all the Portfolio's assets, maintains the general
ledger of the Portfolio and the Fund and computes the daily net asset value of
interests in the Portfolio and the net asset value of shares of the Fund. In
such capacity it attends to details in connection with the sale, exchange,
substitution, transfer or other dealings with the Portfolio's investments,
receives and disburses all funds, and performs various other ministerial duties
upon receipt of proper instructions from the Registrant and the Portfolio. IBT
charges fees which are competitive within the industry. A portion of the fee
relates to custody, bookkeeping and valuation services and is based upon a
percentage of the Fund's and the Portfolio's net assets and a portion of the fee
relates to activity charges, primarily the number of portfolio transactions.
These fees are then reduced by a credit for cash balances of the particular
investment company at the custodian equal to 75% of the 91-day, U.S. Treasury
Bill auction rate applied to the particular investment company's average daily
collected balances for the week. Landon T. Clay, a Director of EVC and an
officer, Trustee or Director of other members of the Eaton Vance organization,
owns approximately 13% of the voting stock of Investors Financial Services
Corp., the holding company parent of IBT. In view of Mr. Clay's interest in IBT,
the Fund is treated as a self-custodian pursuant to Rule 17f-2 under the
Investment Company Act of 1940, and the Fund's investments held by IBT as
custodian's are thus subject to the additional examinations by the Fund's
independent certified public accountants as called for by such Rule. For the
fiscal year ended December 31, 1995, the Fund paid IBT $11,037.
Deloitte & Touche LLP, 125 Summer Street, Boston, Massachusetts are the
independent certified public accountants for the Registrant and the Portfolio.
As such they provide customary professional services in connection with the
audit function for a management investment company, including services leading
to the expression of an opinion on the financial statements in the annual report
to shareholders and preparation of federal tax returns.
Item 17. Brokerage Allocation and Other Practices
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(a) - (e) Not applicable to the Fund. With respect to the Portfolio, the
Registrant incorporates herein by reference the information set forth under Item
17 of the Registration Statement of the Portfolio.
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During the Fund's fiscal years ended December 31, 1995, 1994 and 1993, the
Fund paid brokerage commissions of $3,900, $12,600 and $21,020 respectively, on
portfolio security transactions all of which was paid in respect of portfolio
security transactions for the 1995 fiscal year and $5,100 and $16,220 of which
was paid in respect of portfolio security transactions for the 1994 and 1993
fiscal years, aggregating approximately $2,069,531, $4,996,366 and $9,391,181,
respectively, to firms which provided some research services to Eaton Vance
(although many of such firms may have been selected in any particular
transaction primarily because of their execution capabilities).
Item 18. Capital Stock and Other Securities
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(a) The Declaration of Trust may be amended by the Trustees when authorized
by a majority of the outstanding voting securities of the Trust affected by the
amendment. The Trustees may also amend the Declaration of Trust without the vote
or consent of shareholders to change the name of the Trust or any series or to
make such other changes as do not have a materially adverse effect on the rights
or interests of shareholders or if they deem it necessary to conform the
Declaration to the requirements of federal laws or state laws or regulations.
The Trust or any series may be terminated by: (1) the affirmative vote of the
holders of not less than two-thirds of the shares outstanding and entitled to
vote at any meeting of shareholders of the Trust or the appropriate series, or
by an instrument or instruments in writing without a meeting, consented to by
the holders of two-thirds of the shares of the Trust or a series, provided,
however, that, if such termination is recommended by the Trustees, the vote of a
majority of the outstanding voting securities of the Trust or a series entitled
to vote thereon shall be sufficient authorization; or (2) by means of an
instrument in writing signed by a majority of the Trustees, to be followed by a
written notice to shareholders stating that a majority of the Trustees has
determined that the continuation of the Trust or a series is not in the best
interest of the Trust, or such series or of their respective shareholders.
As permitted by Massachusetts law, there will normally be no meetings of
shareholders for the purpose of electing Trustees unless and until such time as
less than a majority of the Trustees of the Trust holding office have been
elected by shareholders. In such an event the Trustees then in office will call
a shareholder's meeting for the election of Trustees. Except for the foregoing
circumstances and unless removed by action of the shareholders in accordance
with the Trust's By-Laws, the Trustees shall continue to hold office and may
appoint successor Trustees.
The Declaration of Trust further provides that the Trustees will not be
liable for errors of judgment or mistakes of fact or law; but nothing in the
Declaration of Trust protects a Trustee against any liability to which he would
otherwise be subject by reason of willful misfeasance, bad faith, gross
negligence, or reckless disregard of the duties involved in the conduct of his
office. In addition, the By-laws of the Trust provide that no natural person
shall serve as a Trustee of the Trust after the holders of record of not less
than two-thirds of the outstanding shares have declared that he be removed from
office either by declaration in writing filed with the custodian of the assets
of the Trust or by votes set in person or by proxy at a meeting called for the
purpose. The By-laws further provide that under certain circumstances the
shareholders may call a meeting to remove a Trustee and that the Trust is
required to provide assistance in communicating with shareholders about such a
meeting. The By-laws also provide that the Trustees shall promptly call a
meeting of shareholders for the purpose of voting upon a question of removal of
a Trustee when requested so to do by the record holders of not less than 10 per
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centum of the outstanding shares.
In accordance with the Declaration of Trust of the Portfolio, there will
normally be no meetings of the investors for the purpose of electing Trustees
unless and until such time as less than a majority of the Trustees holding
office have been elected by investors. In such an event the Trustees of the
Portfolio then in office will call an investors' meeting for the election of
Trustees. Except for the foregoing circumstances and unless removed by action of
the investors in accordance with the Portfolio's Declaration of Trust, the
Trustees shall continue to hold office and may appoint successor Trustees.
The Declaration of Trust of the Portfolio provides that no person shall
serve as a Trustee if investors holding two-thirds of the outstanding interest
have removed him from that office either by a written declaration filed with the
Portfolio's custodian or by votes cast at a meeting called for that purpose. The
Declaration of Trust further provides that under certain circumstances the
investors may call a meeting to remove a Trustee and that the Portfolio is
required to provide assistance in communicating with investors about such a
meeting.
(b) Not applicable
Item 19. Purchase, Redemption and Pricing of Securities Being Offered
- -------- ------------------------------------------------------------
(a) The Registrant does not offer shares of the Fund for sale.
(b) The net asset value of the Portfolio and of shares of the Fund is
determined by IBT (as agent and custodian for the Fund and the Portfolio) in the
manner described in Item 8 above. The Fund and Portfolio will be closed for
business and will not price their shares on the following business holidays: New
Year's Day, Presidents' Day, Good Friday (a New York Stock Exchange holiday),
Memorial Day, Independence Day, Labor Day, Thanksgiving Day and Christmas Day.
With respect to valuation of the Portfolio's holdings, the Registrant
incorporates herein by reference the information set forth under Item 19 of the
Registration Statement of the Portfolio.
Each investor in the Portfolio, including the Fund, may add to or reduce
its investment in the Portfolio on each day the New York Stock Exchange (the
"Exchange") is open for trading ("Portfolio Business Day") as of the close of
regular trading on the Exchange (the "Portfolio Valuation Time"). The value of
each investor's interest in the Portfolio will be determined by multiplying the
net asset value of the Portfolio by the percentage, determined on the prior
Portfolio Business Day, which represents that investor's share of the aggregate
interests in the Portfolio on such prior day. Any additions or withdrawals for
the current Portfolio Business Day will then be recorded. Each investor's
percentage of the aggregate interest in the Portfolio will then be recomputed as
a percentage equal to a fraction (i) the numerator of which is the value of such
investor's investment in the Portfolio as of the Portfolio Valuation Time on the
prior Portfolio Business Day plus or minus, as the case may be, that amount of
any additions to or withdrawals from the investor's investment in the Portfolio
on the current Portfolio Business Day and (ii) the denominator of which is the
aggregate net asset value of the Portfolio as of the Portfolio Valuation Time on
the prior Portfolio Business Day plus or minus, as the case may be, the amount
of the net additions to or withdrawals from the aggregate investment in the
14
<PAGE>
Portfolio on the current Portfolio Business Day by all investors in the
Portfolio. The percentage so determined will then be applied to determine the
value of the investor's interest in the Portfolio for the current Portfolio
Business Day.
(c) Not applicable
Item 20. Tax Status
- -------- ----------
The Fund, as a series of a Massachusetts business trust, will be treated as
a separate entity for accounting and tax purposes. The Fund intends to meet the
requirements of subchapter M for the taxable year ending October 31, 1996.
Accordingly, the Fund intends to satisfy certain requirements relating to
sources of its income and diversification of its assets and to distribute all of
its net investment income in accordance with the timing requirements imposed by
the Code, so as to avoid any federal income or excise tax on such income. The
Fund's treatment of net realized long-term capital gains is discussed below.
Because the Fund invests its assets in the Portfolio, the Portfolio normally
must satisfy the applicable source of income and diversification requirements in
order for the Fund to satisfy them. The Portfolio will allocate at least
annually among its investors, including the Fund, each investor's distributive
share of the Portfolio's net investment income and any other items of income,
gain, loss, deduction or credit (other than net realized long-term capital gain
which is discussed below). The Portfolio will make allocations to the Fund in
accordance with the Code and applicable regulations and will make moneys
available for withdrawal at appropriate times and in sufficient amounts to
enable the Fund to satisfy the tax distribution requirements that apply to the
Fund and that must be satisfied in order to avoid federal income and/or excise
tax on the Fund. For purposes of applying the requirements of the Code regarding
qualification as a RIC, the Fund will be deemed (i) to own its proportionate
share of each of the assets of the Portfolio and (ii) to be entitled to the
gross income of the Portfolio attributable to such share.
Allocated net realized long-term capital gains are normally retained by the
Fund, and the Fund pays the federal tax thereon. When this is done, the
shareholder includes in his personal income tax return his proportionate share
of such gains, takes a credit for the payment of taxes thereon, and increases
the tax cost basis of his shares by an amount equal to such gains less the taxes
paid. Due to regulations imposed by the Internal Revenue Service the Registrant
is required to distribute net realized long-term capital gains (computed on the
basis of the one-year period ending on October 31 of such year) and 100% of any
income from the present year that was not paid out during such year and on which
the Fund was not taxed. The Registrant therefore reserves the right to
distribute such capital gains when required. Certain distributions, if declared
in October, November or December and paid the following January, will be taxed
to shareholders as if received on December 31 of the year in which they are
declared.
In order to avoid federal excise tax, the Code requires that the Fund
distribute (or be deemed to have distributed) by December 31 of each calendar
year at least 98% of its ordinary income (not including tax-exempt income) for
such year, at least 98% of the excess of its realized capital gains over its
realized capital losses, generally computed on the basis of the one-year period
ending on October 31 of such year, after reduction by any available capital loss
carryforwards, and 100% of any income and capital gains from the prior year (as
previously computed) that was not paid out during such year and on on which the
15
<PAGE>
Fund was not taxed. Further, under current law, provided that the Fund qualifies
as a RIC for federal income tax purposes and the Portfolio is treated as a
partnership for Massachusetts and federal tax purposes, neither the Fund
nor the Portfolio is liable for any income, corporate excise or franchise tax in
the Commonwealth of Massachusetts.
Foreign exchange gains and losses realized by the Portfolio and allocated
to the Fund in connection with the Portfolio's investments in foreign securities
and certain options, futures or forward contracts or foreign currency may be
treated as ordinary income and losses under special tax rules. Certain options,
futures or forward contracts of the Portfolio may be required to be marked to
market (i.e., treated as if closed out) on the last day of each taxable year,
and any gain or loss realized with respect to these contracts may be required to
be treated as 60% long-term and 40% short-term gain or loss. Positions of the
Portfolio in securities and offsetting options, swaps, futures or forward
contracts may be treated as "straddles" and be subject to other special rules
that may, upon allocation of the Portfolio's income, gain or loss to the Fund,
affect the amount, timing and character of the Fund's distributions to
shareholders. Certain uses of foreign currency and foreign currency derivatives
such as options, futures, forward contracts and swaps and investment by the
Portfolio in certain "passive foreign investment companies" may be limited or a
tax election may be made, if available, in order to preserve the Fund's
qualification as a RIC or avoid imposition of a tax on the Fund.
The Portfolio will allocate at least annually to the Fund and its other
investors their respective distributive shares of any net investment income and
net capital gains (except as described above) which have been recognized for
federal income tax purposes (including unrealized gains at the end of the
Portfolio's fiscal year on certain options and futures transactions that are
required to be marked-to-market). Such amounts will be distributed by the Fund
to its shareholders in cash or additional shares, as they elect. Shareholders of
the Fund will be advised of the nature of the distributions.
Certain investors in the Portfolio, including the Fund and other RICs, have
acquired interests in the Portfolio by contributing securities. Due to tax
considerations, during the first five years following the contribution of
securities to the Portfolio by an investor, such securities will not be
distributed to any investor other than the investor who contributed those
securities. Investors who acquire an interest in the Portfolio by contributing
securities and who redeem that interest within five years thereafter will
generally receive back one or more of the securities they contributed. In
partial redemptions by such investors during this period, the Portfolio will
attempt to accommodate requests to distribute initially those contributed
securities and share lots with the highest cost basis.
The Portfolio has significant holdings of highly appreciated securities
that were contributed to the Portfolio by investors other than the Fund. If such
securities were to be sold, the resulting capital gain would be allocated
disproportionately among the Portfolio's investors, with the result that the
Fund would not be subject to taxation on any gain arising prior to the
contribution of the securities to the Portfolio. If any appreciated securities
to be contributed to the Portfolio by the Fund are sold, the resulting capital
gain would be allocated to the Fund.
Amounts paid by the Fund to individuals and certain other shareholders who
have not provided the Fund with their correct taxpayer identification number and
certain required certifications, as well as shareholders with respect to whom
16
<PAGE>
the Fund has received notification from the Internal Revenue Service or a
broker, may be subject to "backup" withholding of federal income tax from the
Fund's dividends and distributions and the proceeds of redemptions (including
repurchases and exchanges) at a rate of 31%. An individual's taxpayer
identification number is generally his or her social security number.
Non-resident alien individuals and certain foreign corporations and other
foreign entities generally will be subject to a U.S. withholding tax at a rate
of 30% on the Fund's distributions from its ordinary income and the excess of
its net short-term capital gain over its net long-term capital loss, unless the
tax is reduced or eliminated by an applicable tax treaty. Distributions from the
excess of the Fund's net long-term capital gain over its net short-term capital
loss received by such shareholders and any gain from the sale or other
disposition of shares of the Fund generally will not be subject to U.S. Federal
income taxation, provided that non-resident alien status has been certified by
the shareholder. Different U.S. tax consequences may result if the shareholder
is engaged in a trade or business in the United States, is present in the United
States for a sufficient period of time during a taxable year to be treated as a
U.S. resident, or fails to provide any required certifications regarding status
as a non-resident alien investor. Foreign shareholders should consult their tax
advisers regarding the U.S. and foreign tax consequences of an investment in the
Fund.
Shareholders should consult their own tax advisers with respect to these or
other special tax rules that may apply in their particular situations, as well
as the state, local or foreign tax consequences of investing in the Fund.
Item 21. Underwriters
- -------- ------------
Not applicable because Registrant does not make a continuous offering of
Fund shares.
Item 22. Calculation of Performance Data
- -------- -------------------------------
Not applicable
17
<PAGE>
Item 23. Financial Statements
- -------- --------------------
Registrant incorporates by reference the audited financial information for
the Registrant contained in (i) the Partnership's shareholder report for the
fiscal year ended December 31, 1995 as previously filed electronically with the
Commission on May 15, 1996 (Accession Number 0000950156-96-000165) and (ii) the
Partnership's shareholder report for the period ended June 30, 1996 as
previously filed electronically with the Commission on August 8, 1996 (Accession
Number 0000950156-96-000633).
18
<PAGE>
PART C
OTHER INFORMATION
Item 24. Financial Statements and Exhibits
- -------- ---------------------------------
(a) THE FOLLOWING FINANCIAL STATEMENTS ARE INCORPORATED BY REFERENCE TO THE
REPORTS TO SHAREHOLDERS OF VANCE, SANDERS EXCHANGE FUND (A CALIFORNIA
LIMITED PARTNERSHIP) DATED DECEMBER 31, 1995 AND JUNE 30, 1996
(ACCESSION NOS. 0000950156-96-000165 AND 0000950156-96-000633,
RESPECTIVELY):
Portfolio of Investments
Statement of Assets and Liabilities
Statement of Operations
Statement of Changes In Net Assets
Financial Highlights For the last Five Years Ended
Notes to Financial Statements
Independent Auditor's Report (in December 31, 1995 report only)
(b) Exhibits:
(1) Declaration of Trust of the Registrant dated June 24, 1996,
filed herewith.
(2) By-laws of the Registrant dated June 24, 1996, filed
herewith.
(3) Not Applicable
(4) Not Applicable
(5) Not Applicable
(6) Not Applicable
(7) The Securities and Exchange Commission has granted the
Registrant an exemptive order that permits the Registrant
to enter into deferred compensation arrangements with its
independent Directors. See in the Matter of Capital
Exchange Fund, Inc., Release No. IC-20671 (November 1,
1994).
(8) Custodian Agreement dated August 30, 1996, filed herewith.
(9) Administrative Services Agreement with Eaton Vance
Management dated August 30, 1996, filed herewith.
(10) Not Applicable
(11) Not Applicable
(12) Not Applicable
(13) Not Applicable
(14) Not Applicable
19
<PAGE>
(15) Not Applicable
(16) Not Applicable
Item 25. Persons Controlled by or under Common Control with Registrant
- -------- -------------------------------------------------------------
Not Applicable
Item 26. Number of Holders of Securities
- -------- -------------------------------
(1) (2)
Number of Record
Title of Class Holders
-------------- -------
Shares of Beneficial 449
Interest as of July 31, 1996
Item 27. Indemnification
- -------- ---------------
Article XI of the Registrant's By-Laws filed herewith as Exhibit 2 contains
provisions limiting the liability, and providing for indemnification, of the
Trustees and officers under certain circumstances.
Registrant's Trustees and officers are insured under a standard mutual fund
errors and omissions insurance policy covering loss incurred by reason of
negligent errors and omissions committed in their capacities as such.
Item 28. Business and Other Connections of Investment Adviser
- -------- ----------------------------------------------------
Registrant incorporates herein by reference the information set forth under
the caption "Investment Advisory and Other Services" in Item 16 of the
Portfolio's registration statement.
Item 29. Principal Underwriters
- -------- ----------------------
Not applicable because Registrant does not make a continuous offering of
its shares.
20
<PAGE>
Item 30. Location of Accounts and Records
- -------- --------------------------------
All applicable accounts, books, and documents required to be maintained by
Registrant by Section 31(a) of the Investment Company Act of 1940 and the Rules
promulgated thereunder are in the possession and custody of the Registrant's
custodian, Investors Bank & Trust Company, 89 South Street, Boston, MA 02110,
and the Registrant's transfer agent, First Data Investor Services Group, 4400
Computer Drive, Westborough, Massachusetts 01581, with the exception of certain
corporate documents and portfolio trading documents as prescribed and listed in
Rules 31a-1(b), (4), (5), (6), (7), (9), (10), and (11) which are in the
possession and custody of the Registrant's Treasurer at 24 Federal Street,
Boston, Massachusetts 02110. Registrant is informed that all applicable
accounts, books and documents required to be maintained by registered investment
advisers are in the custody and possession of the Portfolio's investment
adviser, BMR, 24 Federal Street, Boston, Massachusetts 02110.
Item 31. Management Services
Not Applicable
Item 32. Undertakings
Not Applicable
21
<PAGE>
SIGNATURE
Pursuant to the requirements of the Investment Company Act of 1940, the
Registrant has duly caused this Amendment to be signed on its behalf by the
undersigned, thereunto duly authorized in the City of Boston and Commonwealth of
Massachusetts, on the 29th day of August 1996.
EATON VANCE SERIES TRUST
By /s/ James L. O'Connor
--------------------------------
James L. O'Connor, Treasurer
22
<PAGE>
EXHIBIT INDEX
The following exhibits are filed as part of this Registration Statement.
Exhibit No. Description
- ----------- -----------
1 Declaration of Trust dated June 24, 1996.
2 By-Laws dated June 24, 1996.
8 Custodian Agreement dated August 30, 1996.
9 Administrative Services Agreement with Eaton Vance
Management dated August 30, 1996.
23
DECLARATION OF TRUST
OF
EATON VANCE SERIES TRUST
Dated: June 24, 1996
DECLARATION OF TRUST, made June 24, 1996 by Landon T. Clay, Donald R.
Dwight, Samuel L. Hayes, III, Norton H. Reamer, John L. Thorndike and Jack L.
Treynor, hereinafter referred to collectively as the "Trustees" and individually
as a "Trustee", which terms shall include any successor Trustees or Trustee.
WHEREAS, the Trustees desire to established a trust for the investment and
reinvestment of funds contributed thereto; and
NOW, THEREFORE, the Trustees declare that all money and property
contributed to the trust established hereunder shall be held and managed under
this Declaration of Trust as herein set forth.
ARTICLE I
NAME AND DEFINITIONS
SECTION 1.1. NAME. The name of the trust created hereby is Eaton Vance
Series Trust (the "Trust").
SECTION 1.2 DEFINITIONS. Wherever they are used herein, the following terms
have the following respective meanings:
(a) "Administrator" means the party, other than the Trust, to a contract
described in Section 3.3 hereof.
(b) "By-Laws" means the By-Laws referred to in Section 2.5 hereof, as from
time to time amended.
(d) The term "Commission" has the meaning given it in the 1940 Act.
(e) "Custodian" means any person other than he Trust who has custody of any
Trust Property as required by Section 17(f) of the 1940 Act, but does not
include a system for the central handling of securities described in said
Section 17(f).
(f) "Declaration" means this Declaration of Trust as amended from time to
time. Reference in this Declaration of Trust to "Declaration," "hereof,"
"herein," and "hereunder" shall be deemed to refer to this Declaration rather
than exclusively to the article or section in which such words appear.
(g) "Fund" or "Funds," individually or collectively, means the separate
Series of Shares of the Trust, together with the assets and liabilities
belonging and allocated thereto.
<PAGE>
(i) The term "Interested Person" has the meaning specified in the 1940 Act
subject, however, to such exceptions and exemptions as my be granted by the
Commission in any rule, regulation or order.
(j) "Investment Adviser" means the party, other than the Trust, to an
agreement described in Section 3.2 hereof.
(k) The "1940 Act" means the Investment Company Act of 1940 and the Rules
and Regulations thereunder, as amended from time to time.
(l) "Person" means and includes individuals, corporations, partnerships,
trusts, associations, firms joint ventures and other entities, whether or not
legal entities, as well as governments instrumentalities, and agencies and
political subdivisions thereof, and quasi-governmental agencies and
instrumentalities.
(m) "Principal Underwriter" means the party, other than the Trust, to a
contract described in Section 3.1 hereof.
(n) "Prospectus" means the Prospectus and Statement of Additional
Information included in the Registration Statement of the Trust under the
Securities Act of 1933 as such Prospectus and Statement of Additional
Information may be amended or supplemented and filed with the Commission from
time to time.
(o) "Series" individually or collectively means the separately managed
component(s) of Fund(s) of the Trust (or, if the Trust shall have only one such
component of Fund then that one) as may be established and designated from time
to time by the Trustees pursuant to Section 5.5 hereof.
(p) "Shareholder" means a record owner of Outstanding Shares. A shareholder
of Shares of a Series shall be deemed to own a proportionate undivided
beneficial interest in such Series equal to the number of Shares of such Series
of which he is the record owner divided by the total number of Outstanding
Shares of such Series. A Shareholder of Shares of a Class within a Series shall
be deemed to own a proportionate undivided beneficial interest in such Class
equal to the number of Shares of such Class of which he is the record owner
divided by the total number of Outstanding Shares of such Class. As used herein
the term "Shareholder" shall, when applicable to one or more Series of Funds or
to one or more Classes thereof, refer to the record owners of Outstanding Shares
of such Series, Fund or Funds or of such Class or Classes of shares.
(q) "Shares" means the equal proportionate units of interest into which the
beneficial interest in the Trust shall be divided from time to time, including
the Shares of any and all Series or of any Class within any and all Series of
any Class within any Series (as the context may require) which may be
established by the Trustees, and includes fractions of Shares as well as whole
Shares. "Outstanding Shares" means those Shares shown from time to time on the
books of the Trust or its Transfer Agent as then issued and outstanding, but
shall not include Shares which have been redeemed or repurchased by the Trust
and which are at the time held in the treasury of the Trust.
(r) "Transfer Agent" means any Person other than the Trust who maintains
the Shareholder records of the Trust, such as the list of Shareholders, the
number of Shares credited to each account, and the like.
2
<PAGE>
(s) "Trust" means Eaton Vance Series Trust. As used herein the term Trust
shall, when applicable to one or more Series or Funds, refer to such series or
Funds.
(t) The "Trustees" means the persons who have signed this Declaration, so
long as they shall continue in office in accordance with the terms hereof, and
all other persons who now serve or may from time to time be duly elected,
qualified and serving as Trustees in accordance with the provisions of Article
II hereof and the By-Laws of the Trust, and reference herein to a Trustee of the
Trustees shall refer to such person or persons in this capacity or their
capacities as trustees hereunder.
(u) "Trust Property" means any and all property, real or personal, tangible
or intangible, which is owned or held by or for the account of the Trust or the
Trustees including any and all assets of or allocated to any Series or Class, as
the context may require.
(v) Except as such term may be otherwise defined by the Trustees in
connection with any meeting or other action of Shareholders or in conjunction
with the establishment of any Series or Class of Shares, the term "vote" when
used in connection with an action of Shareholders shall include a vote taken at
a meeting of Shareholders or the consent or consents of Shareholders taken
without such a meeting. Except as such term may be otherwise defined by the
Trustees in connection with any meeting or other action of Shareholders or in
conjunction with the establishment of any Series or Class of Shares, the term
"vote of a majority of the outstanding voting securities" as used is Sections
8.2 and 8.4 shall have he same meaning as is assigned to that term in the 1940
Act.
ARTICLE II
TRUSTEES
SECTION 2.1. MANAGEMENT OF THE TRUST. The business and affairs of the Trust
shall be managed by the Trustees and they shall have all powers and authority
necessary, appropriate or desirable to perform that function. The number, term
of office, manner of election, resignation, filling of vacancies and procedures
with respect to meetings and actions of the Trustees shall be as prescribed in
the By-Laws of the Trust.
SECTION 2.2. GENERAL POWERS. The Trustees in all instances shall act as
principals for and on behalf of the Trust and the applicable Series thereof, and
their acts shall bend the Trust and the applicable Series. The Trustees shall
have full power and authority to do any and all acts and to make and execute any
and all contracts and instruments that they may consider necessary, appropriate
or desirable in connection with the management of the Trust. The Trustees shall
not be bound or limited in any way by present or future laws, practices or
customs in regard to trust investments or to other investments which may be made
by fiduciaries, but shall have full authority and power to make any and all
investments which they, in their uncontrolled discretion, shall deem proper to
promote, implement or accomplish the various objectives and interests of the
Trust and of its Series of Shares. The Trustees shall have full power and
authority to adopt such accounting and tax accounting practices as they consider
appropriate for the Trust and for any Series or Class of Shares. 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, and with such full powers
of delegation as the Trustees may exercise from time to time. The Trustees shall
have 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
Commonwealth of Massachusetts, in any and all states of the United States of
America, in the District of Columbia, and in any and all commonwealths,
3
<PAGE>
territories, dependencies, colonies, possessions, agencies of
instrumentalities of the United States of America and of foreign governments,
and to do all such other things as they deem necessary, appropriate or desirable
in order to promote or implement the interests of the Trust or of any Series or
Class of Shares although such things are not herein specifically mentioned. Any
determinations to what is in the interests of the Trust or of any Series or
Class of Shares made by the Trustees in good fait shall be conclusive and
binding upon all Shareholders. In construing the provisions of this Declaration,
the presumption shall be in favor of a grand of plenary power and authority to
the Trustees.
The enumeration of any specific power in this Declaration shall not be
construed as limiting the aforesaid general and plenary powers.
SECTION 2.3. INVESTMENTS. The Trustees shall have full power and authority:
(a) To operate as and carry on the business of an investment company, and
exercise all the powers necessary and appropriate to the conduct of such
operations.
(b) To acquire or buy, and invest Trust Property in, own, hold for
investment or otherwise, and to sell or otherwise dispose of, all types and
kinds of securities including, but no limited to, stocks, profit-sharing
interests or participations and all other contracts for or evidences of equity
interests, bonds, debentures, warrants and rights to purchase securities,
certificates of beneficial interest, bills, notes and all other contracts for or
evidences of indebtedness, money market instruments including bank certificates
of deposit, finance paper, commercial paper, bankers' acceptances and other
obligations, and all other negotiable and non-negotiable securities and
instruments, however named or described, issued by corporations, trusts,
associations or any other Persons, domestic or foreign, or issued or guaranteed
by the United States of America or any agency or instrumentality thereof, by the
government of any foreign country, by any State, territory or possession of the
United States, by any political subdivision or agency or instrumentality of any
State or foreign country, or by any other government or other governmental or
quasi-governmental agency or instrumentality, domestic or foreign; to acquire
and dispose of interests in domestic or foreign loans made by banks and other
financial institutions; to deposit any assets of the Trust in any bank, trust
company or banking institution or retain any such assets in domestic or foreign
cash or currency; to purchase and sell gold and silver bullion, precious or
strategic metals, coins and currency of all countries; to engage in "when
issued" and delayed delivery transactions; to enter into repurchase agreements,
reverse repurchase agreements and firm commitment agreements; to employ all
types and kinds of hedging techniques and investment management strategies; and
to change the investments of the Trust and of each Series.
(c) To acquire (by purchase, subscription or otherwise), to hold, to trade
in and deal in, to acquire any rights or options to purchase or sell, to sell or
otherwise dispose of, to lend and to pledge any Trust Property or any of the
foregoing securities, instruments or investments; to purchase and sell (or
write) options on securities, currency, precious metals and other commodities,
indices, futures contracts and other financial instruments and assets and inter
into closing and other transactions in connection therewith; to enter into all
types of commodities contracts, including without limitation the purchase and
sale of futures contracts on securities, currency, precious metals and other
commodities, indices and other financial instruments and assets; to enter into
forward foreign currency exchange contracts and other foreign exchange and
currency transactions of all types and kinds; to enter into interest rate,
currency and other swap transactions; and to engage in all types and kinds of
hedging and risk management transactions.
4
<PAGE>
(d) To exercise all rights, powers and privileges of ownership or interest
in all securities and other assets included in the Trust Property, including
without limitation the right to vote thereon and otherwise act with respect
thereto; and to do all acts and things for the preservation, protection,
improvement and enhancement in value of all such securities and assets.
(e) To acquire (by purchase, lease or otherwise) and to hold, use,
maintain, lease, develop and dispose of (by sale or otherwise) any type or kind
of property, real or personal, including domestic or foreign currency, and any
right or interest therein.
(f) To borrow money and in this connection issue notes, commercial paper or
other evidence of indebtedness; to secure borrowings by mortgaging, pledging or
otherwise subjecting as security all or any part of the Trust Property; to
endorse, guarantee, or undertake the performance of any obligation or engagement
of any other Person; and to lend all or any part of the Trust Property to other
Persons.
(g) To aid, support or assist by further investment or other action any
Person, any obligation of or interest in which is included in the Trust Property
or in the affairs of which the Trust or any Series has any direct or indirect
interest; to do all acts and things designed to protect, preserve, improve or
enhance the value of such obligation or interest; and to guarantee or become
surety on any or all of the contracts, securities and other obligations of any
such Person.
(h) To carry on any other business in connection with or incidental to any
of the foregoing powers referred to in this Declaration, to do everything
necessary, appropriate or desirable for the accomplishment of any purpose or the
attainment of any object or the furtherance of any power referred to in this
Declaration, either alone or in association with others, and to do every other
act or thing incidental or appurtenant to or arising out of or connected with
such business or purposes, objects or powers.
The foregoing clauses shall be construed both as objects and powers, and
shall not be held to limit or restrict in any manner the general and plenary
powers of the Trustees.
Notwithstanding any other provision herein, the Trustees shall have full
power in their discretion, without any requirement of approval by Shareholders,
to invest part or all of the Trust Property (or part or all of the assets of any
Fund), or to dispose of part or all of the Trust Property (or part or all of the
assets of any Fund) and invest the proceeds of such disposition, in securities
issued by one or more other investment companies registered under the 1940 Act.
Any such other investment company my (but need not) be a trust (formed under the
laws of the State of New York or of any other state) which is classified as a
partnership for federal income tax purposes.
SECTION 2.4. LEGAL TITLE. Legal title to all the Trust Property shall be
vested in the Trustees who from time to time shall be in office. The Trustees
may hold any security or other Trust Property in a form not indicating any
trust, whether in bearer, unregistered or other negotiable form, and may cause
legal title to any security or other 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 any Series, or in
the name of a custodian, subcustodian, agent, securities depository, clearing
agency, system for the central handling of securities or other book-entry
system, or in the name of a nominee or nominees of the Trust of a Series, or in
the name of a nominee or nominees of a custodian, subcustodian, agent,
securities depository, clearing agent, system for the central handling of
securities or other book-entry system, or in the name of any other Person as
nominee. 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
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the termination of the term of office, resignation, removal or death of a
Trustee he 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.
SECTION 2.5. BY-LAWS. The Trustees shall have full power and authority to
adopt By-Laws providing for the conduct of the business of the Trust and
containing such other provisions as they deem necessary, appropriate or
desirable, and to amend and repeal such By-Laws. Unless the ByLaws specifically
require that Shareholders authorize or approve the amendment or repeal of a
particular provision of the By-Laws, any provision of the By-Laws my be amended
or repealed by the Trustees without Shareholder authorization or approval.
SECTION 2.6. DISTRIBUTION AND REPURCHASE OF SHARES. The Trustees shall have
full power and authority to issue, sell, repurchase, redeem, retire, cancel,
acquire, hold, resell, reissue, dispose of, transfer, and otherwise deal in
Shares. Shares may be sold for cash or property or other consideration whenever
and in such amounts and manner as the Trustees deem desirable. The Trustees
shall have full power to provide for the distribution of Shares either through
one or more principal underwriters or by the Trust itself, or both. The Trustees
shall have full power and authority to cause the Trust and any Series and Class
or Shares to finance distribution activities in the manner described in Section
3.7, and to authorize the Trust, on behalf of one or more Series or Classes of
Shares, to adopt or enter into one or more plans or arrangements whereby
multiple Series and Classes of Shares may be issued and sold to various types of
investors.
SECTION 2.7. DELEGATION. The Trustees shall have full power and authority
to delegate from time to time to such of their number or to officers, employees
or agents of the Trust or to other Persons the doing of such things and the
execution of such agreements or other instruments either in the name of the
Trust or any Series of the Trust of the names of the Trustees or otherwise as
the Trustees may deem desirable or expedient.
SECTION 2.8. COLLECTION AND PAYMENT. The Trustees shall have full power and
authority to collect all property due to the Trust; to pay all claims, including
taxes, against the Trust or Trust Property; to prosecute, defend, compromise,
settle or abandon any claims relating to the Trust or Trust Property; 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.
SECTION 2.9. EXPENSES. The Trustees shall have full power and authority to
incur on behalf of the Trust or any Series or Class of Shares and pay any costs
or expenses which the Trustees deem necessary, appropriate, desirable or
incidental to carry out, implement or enhance the business or operations of the
Trust or any Series thereof, and to pay compensation from the funds of the Trust
to themselves as Trustees. The Trustees shall determine the compensation of all
officers, employees and Trustees of the Trust. The Trustees shall have full
power and authority to cause the Trust to charge all or any part of any cost,
expense or expenditure (including without limitation any expense of selling or
distributing Shares) or tax against the principal or capital of the Trust or any
Series or Class of Shares, and to credit all or any part of the profit, income
or receipt (including without limitation any deferred sales charge or fee,
whether contingent or otherwise, paid or payable to the Trust or any Series or
Class of Shares on any redemption or repurchase of Shares) to the principal or
capital of the Trust or any Series or Class of Shares.
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SECTION 2.10. MANNER OF ACTING. Except as otherwise provided herein or in
the By-Laws, the Trustees and committees of the Trustees shall have full power
and authority to act in any manner which they deem necessary, appropriate or
desirable to carry out, implement or enhance the business or operations of the
Trust or any Series thereof.
SECTION 2.11. MISCELLANEOUS POWERS. The Trustees shall have full power and
authority to: (a) distribute to Shareholders all or any part of the earnings or
profits, surplus (including paid-in surplus), capital (including paid-in
capital) or assets of the Trust or of any Series or Class of Shares, the amount
of such distributions and the manner of payment thereof to be solely at the
discretion of the Trustees; (b) employ, engage or contract with such Persons as
the Trustees may deem desirable for the transaction of the business or
operations of the Trust or any Series thereof; (c) enter into or cause the Trust
or any Series thereof to enter into joint ventures, partnerships (whether as
general partner, limited partner or otherwise) and any other combinations or
associations; (d) remove Trustees or fill vacancies in or add to their number,
elect and remove such officers and appoint and terminate such agents or
employees or other Persons as the consider appropriate, and appoint from their
own number, and terminate, any one or more committees which may exercise some or
all of the power and authority of the Trustees as the Trustees may determine;
(e) purchase, and pay for out of Trust Property, insurance policies which may
insure such of the Shareholders, Trustees, officers, employees, agents,
investment advisers, administrators, principal underwriters, distributors or
independent contractors of the Trust as the Trustees deem appropriate against
loss or liability arising by reason of holding any such position or by reason of
any action taken or omitted by any such Person in such capacity, whether or not
constituting negligence, or whether or not the Trust would have the power to
indemnify such Person against such loss or liability; (f) establish pension,
profit-sharing, share purchase, and other retirement, incentive and benefit
plans for any Trustees, officers, employees and agents of the Trust; (g)
indemnify or reimburse any Person with whom the Trust or any Series thereof has
dealings, including without limitation the Investment Adviser, Administrator,
Principal Underwriter, Transfer Agent and financial service firms, to such
extent as the Trustees shall determine; (h) guarantee the indebtedness or
contractual obligations of other Persons; (i) determine and change the fiscal
year of the Trust or any Series thereof and the methods by which its and their
books, accounts and records shall be kept; and (j) adopt a seal for the Trust,
but the absence of such seal shall no impair the validity of any instrument
executed on behalf of the Trust or any Series thereof.
SECTION 2.12. LITIGATION. The Trustees shall have full power and authority,
in the name and on behalf of the Trust, to engage in and to prosecute, defend,
compromise, settle, abandon, or adjust by arbitration or otherwise, any actions,
suits proceedings, disputes, claims and demands relating to the Trust, and out
of the assets of the Trust or any Series thereof to pay or to satisfy any
liabilities, losses, debts, claims or expenses (including without limitation
attorneys' fees) incurred in connection therewith, including those of
litigation, and such power shall include without limitation the power of the
Trustees or any committee thereof, in the exercise of their or its good faith
business judgment, to dismiss or terminate any action, suit, proceeding,
dispute, claim or demand, derivative or otherwise, brought by any Person,
including a Shareholder in his own name or in the name of the Trust or any
Series thereof, whether or not the Trust or any Series thereof or any of the
Trustees may be named individually therein or the subject matter arises by
reason of business for or on behalf of the Trust or any Series thereof.
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ARTICLE III
CONTRACTS
SECTION 3.1 PRINCIPAL UNDERWRITER. The Trustees may in their discretion
form time to time authorize the Trust to enter into one or more contracts
providing for the sale of the Shares. Pursuant to any such contract the Trust
may either agree to sell the Shares to the other party to the contractor appoint
such other party its sales agent for such Shares. In either case, any such
contract shall be on such terms and conditions as the Trustees may in their
discretion determine; and any such contract may also provide for the repurchase
or sale of Shares by such other party as principal or as agent of the Trust.
SECTION 3.2. INVESTMENT ADVISER. The Trustees may in their discretion from
time to time authorize the Trust to enter into one or more investment advisory
agreements, or, if the Trustees establish multiple Series, separate investment
advisory agreements, with respect to one or more Series whereby the other party
or parties to any such agreements shall undertake to furnish the Trust or such
Series investment advisory and research facilities and services and such other
facilities and services, if any, as the Trustees shall consider desirable and
all upon such terms and conditions as the Trustees may in their discretion
determine. Notwithstanding any provisions of this Declaration, the Trustees may
authorize the Investment Adviser, in its discretion and without any prior
consultation with the Trust, to buy, sell, lend and otherwise trade and deal in
any and all securities, commodity contracts and other investments and assets of
the Trust and of each Series and to engage in and employ all types of
transactions and strategies in connection therewith. Any such action take
pursuant to such agreement shall be deemed to have been authorized by all of the
Trustees.
The Trustees may also authorize the Trust to employ, or authorize the
Investment Adviser to employ, one or more sub-investment advisers from time to
time to perform such of the acts and services of the Investment Adviser and upon
such terms and conditions as ma be agreed upon between the Investment Adviser
and such sub-investment adviser and approved by the Trustees.
SECTION 3.3. ADMINISTRATOR. The Trustees may in their discretion from time
to time authorize the Trust to enter into an administration agreement or, if the
Trustees establish multiple Series or Classes, separate administration
agreements with respect to one or more Series or Classes, whereby the other
party to such agreement shall undertake to furnish to the Trust or a Series or a
Class thereof with such administrative facilities and services and such other
facilities and services, if any, as the Trustees consider desirable and all upon
such terms and conditions as the Trustees may in their discretion determine.
SECTION 3.4. OTHER SERVICE PROVIDERS. The Trustees may in their discretion
from time to time authorize the Trust to enter into one or more agreements with
respect to one or more Series or Classes of Shares whereby the other party or
parties to any such agreements will undertake to provide to the Trust or Series
or Class or Shareholders or beneficial owners of Shares such services as the
Trustees consider desirable and all upon such terms and conditions as the
Trustees in their discretion may determine.
SECTION 3.5. TRANSFER AGENTS. The Trustees may in their discretion from
time to time appoint one or more transfer agents for the Trust or any Series
thereof. Any contract with a transfer agent shall be on such terms and
conditions as the Trustees may in their discretion determine.
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SECTION 3.6. CUSTODIAN. The Trustees may appoint a bank or trust company
having an aggregate capital, surplus and undivided profits (as shown in its last
published report) of at least $2,000,000 as the principal custodian of the Trust
(the "Custodian") with authority as its agent to hold cash and securities owned
by the Trust and to release and deliver the same upon such terms and conditions
as may be agreed upon between the Trust and Custodian.
SECTION 3.7. PLANS OF DISTRIBUTION. The Trustees may in their discretion
authorize the Trust, on behalf of one or more Series or Classes of Shares, to
adopt or enter into a plan or plans of distribution and any related agreements
whereby the Trust or Series or Class may finance directly or indirectly any
activity which is primarily intended to result i sales of Shares or any
distribution activity within the meaning of Rule 12b-1 (or successor rule) under
the 1940 Act. Such plan or plans of distribution and any related agreements may
contain such terms and conditions as the Trustees may in their discretion
determine, subject to the requirements of the 1940 Act and any other applicable
rules and regulations.
SECTION 3.8. AFFILIATIONS. The fact that:
(i) any of the Shareholders, Trustees or officers of the Trust is a
shareholder, creditor, director, officer, partner, trustee or employee of or has
any interest in any Person or any parent or affiliate of any such Person, with
which a contract or agreement of the character described in Sections 3.1, 3.2,
3.3, 3.4, 3.5 or 3.6 above has been or will be made or to which payments have
been or will be made pursuant to a plan or related agreement described in
Section 3.7 above, or that any such Person , or any parent or affiliate thereof,
is a Shareholder of or has an interest in the Trust, or that
(ii) any such Person also has similar contracts, agreements or plans with
other investment companies (including, without limitation, the investment
companies referred to in the last paragraph of Section 2.3) or organization, or
has other business activities or interests, shall not affect in any way the
validity of any such contract, agreement or plan or disqualify any Shareholder,
Trustee or officer of the Trust from authorizing, voting upon or executing the
same or create any liability or accountability to the Trust or its Shareholders.
ARTICLE IV
LIMITATIONS OF LIABILITY OF SHAREHOLDERS, TRUSTEES AND OTHERS
SECTION 4.1. NO PERSONAL LIABILITY OF SHAREHOLDERS, TRUSTEES, OFFICERS AND
EMPLOYEES. No Shareholder shall be subject to any personal liability whatsoever
to any Person in connection with Trust Property or the acts, obligations or
affairs of the Trust or any Series thereof. All Persons dealing or contracting
with the Trustees as such or with the Trust or any Series thereof shall have
recourse only to the Trust or such Series for the payment of their claims or for
the payment or satisfaction of claims, obligations or liabilities arising out of
such dealings or contracts. No Trustee, officer or employee of the Trust,
whether past, present or future, shall be subject to any personal liability
whatsoever to any such Person, and all such Persons shall look solely to the
Trust Property, or the assets of one or more specific Series of the Trust if the
claim arises from the act, omission or other conduct of such Trustee, officer or
employee with respect to only such Series, for satisfaction of claims of any
nature arising in connection with the affairs of the Trust or such Series. If
any Shareholder, Trustee, officer or employee, as such, of the Trust or any
Series thereof, is made a party to any suit or proceeding to enforce any such
liability of the Trust or any Series thereof, he shall not, on account thereof,
be held to any personal liability.
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SECTION 4.2. TRUSTEE'S GOOD FAITH ACTION; ADVICE OF OTHERS; NO BOND OR
SURETY. The exercise by the Trustees of their powers and discretions hereunder
shall be binding upon everyone interested. A trustee shall not be liable for
errors of judgment or mistakes of fact or law. The Trustees shall not be
responsible or liable in any event for any neglect or wrongdoing of any officer,
agent, employee, consultant, investment adviser or other adviser, administrator,
distributor or principal underwriter, custodian or transfer, dividend
disbursing, shareholder servicing or accounting agent of the Trust, nor shall
any Trustee be responsible for the act or omission of any other Trustee. The
Trustees may take advice of counsel or other experts with respect to the meaning
and operation of this Declaration and their duties as Trustees, and shall be
under no liability for any act or omission in accordance with such advice or for
failing o follow such advice. In discharging their duties, the Trustees, when
acting in good faith, shall be entitled to rely upon the records, books and
accounts of the Trust and upon reports made to the Trustees by any officer,
employee, agent, consultant, accountant, attorney, investment adviser or other
adviser, principal underwriter, expert, professional firm or independent
contractor. The Trustees as such shall not be required to give any bond or
surety or any other security for the performance of their duties. No provision
of this Declaration shall protect any Trustee or officer of the Trust against
any liability to the Trust of its Shareholders to which he would otherwise be
subject by reason of his own willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of his office.
SECTION 4.3. INDEMNIFICATION. The Trustees may provide, whether in the
By-Laws or by contract, vote or other action, for the indemnification by the
Trust or by any Series thereof of the Shareholders, Trustees, officers and
employees of the Trust and of such other Persons as the Trustees in the exercise
of their discretion my deem appropriate or desirable. Any such indemnification
may be mandatory of permissive, and may be insured against by policies
maintained by the Trust.
SECTION 4.4. NO DUTY OF INVESTIGATION. No purchaser, lender or other Person
dealing with the Trustees or any officer, employee or agent of the Trust or a
Series thereof 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, instrument, certificate, Share, other
security of the Trust of a Series thereof or undertaking, and every other act or
thing whatsoever executed in connection with the Trust shall be conclusively
presumed 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 or a Series thereof. Every written obligation,
contract, instrument, certificate, Share, other security of the Trust or a
Series thereof or undertaking made or issued by the Trustees may recite that the
same is executed or made by them not individually, but as Trustees under the
Declaration, and that the obligations of the Trust of a Series thereof under any
such instrument are not binding upon any of the Trustees or Shareholders
individually, but bind only the Trust Property or the Trust Property of the
applicable Series, and may contain any further recital which they may deem
appropriate, but the omission of any such recital shall not operate to bind the
Trustees or Shareholders individually.
SECTION 4.5. RELIANCE ON RECORDS AND EXPERTS. Each Trustee, officer or
employee of the Trust or a Series thereof 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 records,
books and accounts of the Trust or a Series thereof, upon an opinion or other
advice of legal counsel, or upon reports made or advice given to the Trust or a
Series thereof by any Trustee or any of its officers employees or by the
Investment Adviser, the Administrator, The Custodian, The Principal Underwriter,
Transfer Agent, accountants, appraisers or other experts, advisers, consultants
or professionals selected with reasonable care by the Trustees or officers of
the Trust, regardless of whether the person rendering such report or advice may
also be a Trustee, officer or employee of the Trust.
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ARTICLE V
SHARES OF BENEFICIAL INTEREST
SECTION 5.1. BENEFICIAL INTEREST. The interest of the beneficiaries
hereunder shall be divided into transferable Shares of beneficial interest
without par value. The number of such Shares of beneficial interest authorized
hereunder is unlimited, and the number of Shares of each Series or Class thereof
that may be issued hereunder is unlimited. The Trustees shall have the exclusive
authority without the requirement of Shareholder authorization or approval to
establish and designate one or more Series of Shares and one or more Classes
thereof as the Trustees deem necessary, appropriate or desirable. Each Share of
any series shall represent a beneficial interest only in the assets of that
Series. Subject to the provisions of Section 5.5 hereof, the Trustees may also
authorize the creation of additional Series of Shares (the proceeds of which may
be invested in separate and independent investment portfolios) and additional
Classes of Shares within any Series. All Series issued hereunder including,
without limitation, Shares issued in connection with a dividend or distribution
in Shares or a split in Shares, shall be fully paid and nonassessable.
SECTION 5.2. RIGHTS OF SHAREHOLDERS. The ownership of the Trust property of
every description and the right to conduct any business of the Trust are vested
exclusively in the Trustees, and the Shareholders shall have no interest therein
other than the beneficial interest conferred by their Shares, and they shall
have no right to call for any partition or division of any property, profits,
rights or interests of the Trust or on any Fund nor can they be called upon to
share or assume any losses of the Trust or of any Fund or suffer an assessment
of any kind by virtue of their ownership of Shares. The Shares shall be personal
property giving only the rights specifically set forth in this Declaration. The
Shares shall not entitle the holder to preference, preemptive, appraisal,
conversion or exchange rights, except as the Trustees may specifically determine
with respect to any Series of Class of Shares.
SECTION 5.3. 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
Massachusetts business 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.
SECTION 5.4. ISSUANCE OF SHARES. The Trustees in their discretion may, from
time to time and without any authorization or vote of the Shareholders, issue
Shares, in addition to the then issued and outstanding Shares and Shares held in
the treasury, to such party or parties and for such amount and type of
consideration, including cash or property, a such time or times and on such
terms as the Trustees may deem appropriate or desirable, except that only Shares
previously contracted to be sold may be issued during any period when the right
of redemption is suspended pursuant to Section 6.9 hereof, and may in such
manner acquire other assets (including the acquisition of assets subject to, and
in connection wit the assumption of, liabilities) and businesses. In connection
with any issuance of Shares, the Trustees may issue fractional Shares and
reissue and resell full and fractional Shares held in the treasury. The Trustees
may from time to time divide or combine the Shares of the Trust or, if the
Shares be divided into Series or Classes, of any Series or any Class thereof of
the Trust, into a greater or lesser number without thereby changing the
proportionate beneficial interests in the Trust or in the Trust Property
allocated or belonging to such Series or Class. Contributions to the Trust or
Series thereof may be accepted for, and Shares shall be redeemed as, whole
Shares and/or fractional Shares as the Trustees may in their discretion
determine. The Trustees may authorize the issuance of certificates of beneficial
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interest to evidence the ownership of Shares. Shares held in the treasury
shall not be voted nor shall such shares be entitled to any dividends or other
distributions declared with respect thereto.
SECTION 5.5. SERIES AND CLASS DESIGNATIONS. Without limiting the exclusive
authority of the Trustees set forth in Section 5.1 to establish and designate
any further Series, the following Series are hereby established and designated:
Capital Exchange Fund, Depositors Fund of Boston, Diversification Fund, The
Exchange Fund of Boston, Fiduciary Exchange Fund, Second Fiduciary Exchange Fund
and Vance Sanders Exchange Fund (the "Existing Series"). Without limiting the
exclusive authority of the Trustees set forth in Section 5.1 to establish and
designate any further Classes, there are hereby established and designated
distinct Classes of Shares of the Existing Series: (none as of the date of this
Declaration). The Shares of the Existing Series and such Classes thereof herein
established and designated and any Shares of any further Series and Classes
thereof that may from time to time be established and designated by the Trustees
shall be established and designated, and the variations i the relative rights
and preferences as between the different Series and Classes shall be fixed and
determined, by the Trustees (unless the Trustees otherwise determine with
respect to further Series or Classes at the time of establishing and designating
the same); provided, that all Shares shall be identical except that there may be
variations so fixed and determined between different Series or Classes thereof
as to investment objective, policies and restrictions, sales charges, purchase
prices, determination of net asset value, assets, liabilities, expenses, costs,
charges and reserves belonging or allocated thereto, the price, terms and manner
of redemption or repurchase, special and relative rights as to dividends and
distributions and on liquidation, conversion rights, exchange rights, and voting
rights. All references to Shares in this Declaration shall be deemed to be
Shares of any or all Series or Classes as the context may require. As to any
Existing Series and Classes, both heretofore and herein established and
designated, and any further division of the Trust into additional Series or
Classes, the following provisions shall be applicable:
(i) The number of authorized Shares and the number of Shares of each Series
or Class thereof that may be issued shall be unlimited. The Trustees may
classify or reclassify any unissued Shares or any Shares previously issued and
reacquired of any Series or Class into one or more other Series or one or more
other classes that may be established and designated from time to time. The
Trustees may hold as treasury shares (of the same or some other Series or
Class), reissue for such consideration and on such terms as they may determine,
or cancel any Shares of any Series or Class reacquired by the Trust at their
discretion from time to time.
(ii) All consideration received by the Trust for the issue or sale of
Shares of a particular Series, together with all assets in which such
consideration is invested or reinvested, all income, earnings, profits, and
proceeds thereof, including any proceeds derived from the sale, exchange or
liquidation of such assets, and any funds or payments derived form any
reinvestment of such proceeds in whatever form the same may be, shall
irrevocably belong to that Series for all purposes, subject only to the rights
of creditors of such Series and except as may otherwise be required by
applicable tax laws, and shall be so recorded upon the books of account of the
Trust. In the event that there are any assets, income, earnings, profits, and
proceeds thereof, funds, or payments which are not readily identifiable as
belonging to any particular Series, the Trustees or their delegate shall
allocate them among any one or more of the Series established and designated
form time to time in such manner and on such basis as the Trustees in their sole
discretion deem fair and equitable. Each such allocation by the Trustees or
their delegate shall be conclusive and binding upon the Shareholders of all
Series for all purposes. No holder of Shares of any Series shall have any claim
on or right to any assets allocated or belonging to any other Series.
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(iii) Any general liabilities, expenses, costs, charges or reserves of the
Trust which are no readily identifiable as belonging to any particular Series
shall be allocated and charged by the Trustees or their delegate to and among
any one or more of the Series established and designated from time to time in
such manner and on such basis as the Trustees in their sole discretion deem fair
and equitable. The assets belonging to each particular Series shall be charged
with the liabilities, expenses, costs, charges and reserves of the Trust so
allocated to that Series and all liabilities, expenses, costs, charges and
reserves attributable to that Series which are not readily identifiable as
belonging to any particular Class thereof. Each allocation of liabilities,
expenses, costs, charges and reserves by the Trustees or their delegate shall be
conclusive and binding upon the Shareholders of all Series and Classes for all
purposes. The Trustees shall have full discretion to determine which items are
capital; and each such determination shall be conclusive and binding upon the
Shareholders. The assets of a particular Series of the Trust shall, under no
circumstances, be charged with liabilities, expenses, costs, charges and
reserves attributable to any other Series or Class thereof of the Trust. All
Persons extending credit to, or contracting with or having any claim against a
particular Series of the Trust shall look only to the assets of that particular
series for payment of such credit, contract or claim.
(iv) Dividends and distributions on Shares of a particular Series or Class
may be paid or credited in such manner and with such frequency as the Trustees
may determine, to the holders of Shares of that Series or Class, from such of
the earnings or profits, surplus (including paid-in surplus), capital (including
paid-in capital) or assets belonging to that Series, as the Trustees may deem
appropriate or desirable, after providing for actual and accrued liabilities,
expenses, costs, charges and reserves belonging and allocated to that Series or
Class. Such dividends and distributions may be paid daily or otherwise pursuant
to the offering prospectus relating to the Shares or pursuant to a standing vote
or votes of the Trustees adopted only once or from time to time or pursuant to
other authorization or instruction of the Trustees. All dividends and
distributions on Shares of a particular Series or Class shall be distributed pro
rata to the Shareholders of that Series or class in proportion to the number of
Shares of that Series or Class held by such Shareholders at the time of record
established for the payment or crediting of such dividends or distributions.
(v) Each Share of a Series of the Trust shall represent a beneficial
interest in the net assets of such Series. Each holder of Shares of a Series or
Class thereof shall be entitled to receive his pro rata share of distributions
of income and capital gains made with respect to such Series or Class net of
liabilities, expenses, costs, charges and reserves belonging and allocated to
such Series or Class. Upon redemption of his Shares of indemnification for
liabilities incurred by reason of his being or having been a Shareholder of a
Series or Class, such Shareholder shall be paid solely out of the funds and
property of such Series of the Trust. Upon liquidation or termination of a
Series or Class thereof of the Trust, a Shareholder of such Series or Class
thereof shall be entitled to receive a pro rata share of the net assets of such
Series based on the net asset value of his Shares. A Share holder of a
particular Series of the Trust shall not be entitled to commence or participate
in a derivative or class action on behalf of any other Series or the
Shareholders of any other Series of the Trust.
(vi) On any matter submitted to a vote of Shareholder, the Shares entitled
to vote thereon and the manner in which such Shares shall be voted shall be as
set forth in the By-Laws or proxy materials for the meeting or other
solicitation materials or as otherwise determined by the Trustees, subject to
any applicable requirements of the 1940 Act. The Trustees shall have full power
and authority to call meetings of the Shareholder of a particular Class of
Classes of Shares or of one or more particular Series of Shares, or otherwise
call for the action of such Shareholders on any particular matter.
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(vii) Except as otherwise provided in this Article V, the Trustees shall
have full power and authority to determine the designations, preferences,
privileges, sales charges, purchase prices, assets, liabilities, expenses,
costs, charges and reserves belonging or allocated thereto, limitations and
rights, including without limitation voting, dividend, distribution and
liquidation rights, of each Class and Series of Shares. Subject to any
applicable requirements of the 1940 Act, the Trustees shall have the authority
to provide that Shares of one Class shall be automatically converted into Shares
of another Class of the same Series or that the holders of Shares of any Series
or Class shall have the right to convert or exchange such Shares into shares of
one or more other Series or Classes of Shares, all in accordance with such
requirements, conditions and procedures as may be established by the Trustees.
(viii) The establishment and designation of any Series or Class of Shares
shall be effective upon the execution by a majority of the then Trustees of an
instrument setting forth such establishment and designation and the relative
rights and preferences of such Series or Class, or as otherwise provided in such
instrument. The Trustees may by an instrument subsequently executed by a
majority of their number amend, restate or rescind any prior instrument relating
to the establishment and designation of any such Series or Class. Each
instrument referred to in this paragraph shall have the status of an amendment
to this Declaration in accordance with Section 8.4 hereof, and a copy of each
such instrument shall be filed in accordance with Section 10.2 hereof.
SECTION 5.6. ASSENT TO DECLARATION OF TRUST AND BY-LAWS. Every Shareholder,
by virtue of having become a Shareholder, shall be held to have expressly
assented and agreed to all the terms and provisions of this Declaration and of
the By-Laws of the Trust.
ARTICLE VI
REDEMPTION AND REPURCHASE OF SHARES
SECTION 6.1. REDEMPTION OF SHARES. (a)Shares of the Trust shall be
redeemable, at such times and in such manner as may be permitted by the Trustees
from time to time. The trustees shall have full power and authority to vary and
change the right of redemption applicable to the various Series and Classes of
Shares established by the Trustees. Redeemed or repurchased shares may be resold
by the Trust. The Trust may require any shareholder to pay a sales charge to the
Trust, the Principal Underwriter or any other Person designated by the Trustees
upon redemption or repurchase of Shares in such amount and upon such conditions
as shall be determined from time to time by the Trustees.
(b) The Trust shall redeem the Shares of the Trust or any Series or Class
thereof at the price determined as hereinafter set forth, upon the appropriately
verified written application of the record holder thereof (or upon such other
form of request as the Trust may use for the purpose) deposited at such office
or agency as may be designated from time to time for that purpose by the
Trustees. The Trust may from time to time establish additional requirements,
terms, conditions and procedures, not inconsistent with the 1940 Act, relating
to the redemption of Shares.
SECTION 6.2. PRICE. Shares shall be redeemed at a price based on their net
asset value determined as set forth in Section 7.1 hereof as of such time as the
Trustees shall prescribe. The amount of any sales charge or redemption fee
payable upon redemption of shares may be deducted form the proceeds of such
redemption.
SECTION 6.3. PAYMENT. Payment of the redemption price of Shares thereof
shall be made in cash or in property to the Shareholder at such time and in the
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manner, not inconsistent with the 1940 Act, as may be specified from time
to time in the then effective prospectus relating to such shares, subject to the
provisions of Sections 6.4 and 6.9 hereof. Notwithstanding the foregoing, the
Trust of its agent may withhold from such redemption proceeds any amount arising
(i) from a liability of the redeeming Shareholder to the Trust or (ii) in
connection with any federal or state tax withholding requirements.
SECTION 6.4. EFFECT OF SUSPENSION OF DETERMINATION OF NET ASSET VALUE. If,
pursuant to Section 7.1 hereof, the Trust shall declare a suspension of the
determination of net asset value with respect to Shares of the Trust or of any
Series or class thereof, the rights of Shareholders (including those who shall
have applied for redemption pursuant to Section 6.1 hereof but who shall not yet
received payment) to have Shares redeemed and paid for by the Trust or a Series
shall be suspended until the termination of such suspension is declared. Any
record holder who shall have his redemption right so suspended may, during the
period of such suspension, by appropriate written notice at the office or agency
where his application or request for redemption was made, with draw his
application or request and withdraw any Share certificates on deposit.
SECTION 6.5. REPURCHASE BY AGREEMENT. The Trust may repurchase Shares
directly, or through the Principal Underwriter or another agent designated for
the purpose, by agreement with the owner thereof at a price not exceeding the
net asset value per share determined as of such time as the Trustees shall
prescribe. The trust may from time to time establish the requirements, terms,
conditions and procedures relating to such repurchases, and the amount of any
sales charge or repurchase fee payable on any repurchase of shares may be
deducted from the proceeds of such repurchase.
SECTION 6.6. REDEMPTION OF SHAREHOLDER'S INTEREST. The Trustees, in their
sole discretion, may cause the Trust to redeem all of the shares of one or more
Series or Class thereof held by any Shareholder if the value of such Shares held
by such Shareholder is less than the minimum amount established from time to
time by the Trustees.
SECTION 6.7. REDEMPTION OF SHARES IN ORDER TO QUALIFY AS REGULATED
INVESTMENT COMPANY; DISCLOSURE OF HOLDING. (a)If the Trustees shall, at any time
and in good faith, be of the opinion that direct or indirect ownership of Shares
or other securities of the Trust has or may become concentrated in any Person to
an extent which would disqualify the Trust or any Series of the Trust as a
regulated investment company under the Internal Revenue Code of 1986, then the
Trustees shall have the power by lot or other means deemed equitable by them (i)
to call for redemption by any such Person a number, or principal amount, of
Shares or other securities of the Trust or any Series of the Trust sufficient to
maintain or bring the direct or indirect ownership of Shares or other securities
of the Trust or any Series of the Trust into conformity with the requirements
for such qualification and (ii) to refuse to transfer or issue Shares or other
securities of the Trust or any Series of the Trust to any Person whose
acquisition of the Shares or other securities of the Trust or any Series of the
Trust in question would result in such disqualification. the redemption shall be
effected in the manner provided in Section 6.1 and at the redemption price
referred to in Section 6.2.
(b) The holders of Shares or other securities of the Trust shall upon
demand disclose to the Trustees in writing such information with respect to
direct and indirect ownership of shares or other securities of the Trust as the
Trustees deem necessary to comply with the provisions of the Internal Revenue
Code of 1986, or to comply with the requirements of any other taxing authority.
SECTION 6.8. REDUCTION IN NUMBER OF OUTSTANDING SHARES PURSUANT TO NET
ASSET VALUE FORMULA. The Trust may also reduce the number of outstanding Shares
of the Trust or of any Series or class thereof pursuant to the provisions of
Section 7.3.
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SECTION 6.9. SUSPENSION OF RIGHT OF REDEMPTION. The Trust may declare a
suspension of the right of redemption or postpone the date of payment or
redemption for the whole or any part of any period (i) during which the New York
Stock Exchange is closed other than customary weekend and holiday closings, (ii)
during which trading on the New York Stock Exchange is restricted, (iii) during
which an emergency exists as a result of which disposal by the Trust of a Fund
of securities owned by it is not reasonably practicably or it is not reasonable
practicable for the Trust or a Fund fairly to determine the value of its net
assets, of (iv) as the Commission may by order permit for the protection of
security holders of the Trust. Such suspension shall take effect at such time as
the Trust shall specify but not later than the close of business on the business
day next following the declaration of suspension, and thereafter there shall be
no right of redemption or payment on redemption until the Trust shall declare
the suspension at an end, except that the suspension shall terminate in any
event on the first day on which said stock exchange shall have reopened or the
period specified in (ii) or (iii) shall have expired (as to which in the absence
of an official ruling by the Commission, the determination of the Trust shall be
conclusive). In the case of a suspension of the right of redemption, a
Shareholder may either withdraw his application or request for redemption or
receive payment based on the net asset value existing after the termination of
the suspension.
ARTICLE VII
DETERMINATION OF NET ASSET VALUE, NET INCOME AND DISTRIBUTIONS
SECTION 7.1. NET ASSET VALUE. The net asset value of each outstanding Share
of the Trust or of each Series or class thereof shall be determined on such days
and at or as of such time or times as the Trustees may determine. Any reference
in this Declaration to the time at which a determination of net asset value is
made shall mean the time as of which the determination is made. The power and
duty to determine net asset value may be delegated by the Trustees from time to
time to the Investment Adviser, the Administrator, the Custodian, the Transfer
Agent or such other Person or Persons as the Trustees may determine. The value
of the assets of the Trust or any Series thereof shall be determined in a manner
authorized by the Trustees. From the total value of said assets, there shall be
deducted all indebtedness, interest, taxes, payable or accrued, including
estimated taxes on unrealized book profits, expenses and management charges
accrued to the appraisal date, amounts determined and declared as a dividend or
distribution and all other items in the nature of liabilities which shall be
deemed appropriate, as incurred by or allocated to the Trust or any series or
Class thereof. The resulting amount, which shall represent the total net assets
of the Trust or Series or Class thereof, shall be divided by the number of
Shares of the Trust or series or Class thereof outstanding at the time and the
quotient so obtained shall be deemed to be the net asset value of the Shares of
the Trust or Series or Class thereof. The trust may declare a suspension of the
determination of net asset value to the extent permitted by the 1940 Act. It
shall not be a violation of any provision of this Declaration if Shares are
sold, redeemed or repurchased by the Trust at a price other than one based on
net asset value if the net asset value is affected by one or more errors
inadvertently made in the pricing of portfolio securities or other investments
or in accruing or allocation income, expenses, reserves or liabilities. No
provision of this Declaration shall be construed to restrict or affect the right
or ability of the Trust to employ or authorize the use of pricing services,
appraisers or any other means, methods, procedures, or techniques in valuing the
assets or calculating the liabilities of the Trust or any Series or Class
thereof.
SECTION 7.2. DIVIDENDS AND DISTRIBUTIONS. (a)The Trustees may from time to
time distribute ratably among the Shareholders of the Trust or of a Series or
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Class thereof such proportion of the net earnings or profits, surplus
(including paid-in surplus), capital (including paid-in capital), or assets of
the Trust or such Series held by the Trustees as they may deem appropriate or
desirable. Such distributions may be made in cash, additional Shares or property
(including without limitation any type of obligations of the Trust of Series or
Class thereof additional Shares of the Trust or Series or Class thereof issuable
hereunder in such manner, at such times, and on such terms as the Trustees may
deem appropriate or desirable. Such distributions may be among the Shareholders
of the Trust or Series or Class thereof at the time of declaring a distribution
or among the Shareholders of the Trust or Series or Class thereof at such other
date or time or dates or times as the Trustees shall determine. The Trustees may
in their discretion determine that, solely for the purposes of such
distributions, Outstanding Shares shall exclude Shares for which orders have
been placed subsequent to a specified time. The Trustees may always retain from
the earnings or profits such amounts as they may deem appropriate or desirable
to pay the expenses and liabilities of the Trust or a Series or Class thereof or
to meet obligations of the Trust or a Series or Class thereof, together with
such amounts as they may deem desirable to use in the conduct of its affairs or
to retain for future requirements or extensions of the business or operations of
the Trust or such Series. The Trust may adopt and offer to Shareholders such
dividend reinvestment plans, cash dividend payout plans or other distribution
plans as the Trustees may deem appropriate or desirable. The Trustees may in
their discretion determine that an account administration fee or other similar
charge may be deducted directly from the income and other distributions paid on
Shares to a Shareholder's account in any Series or Class.
(b) The Trustees may prescribe, in their absolute discretion, such bases
and times for determining the amounts for the declaration and payment of
dividends and distributions as they may deem necessary, appropriate or
desirable.
(c) Inasmuch as the computation of net income and gains for federal income
tax purposes may vary from the computation thereof on the books of account, the
above provisions shall be interpreted to give the Trustees full power and
authority in their absolute discretion to distribute for any fiscal year as
dividends and as capital gains distributions, respectively, additional amounts
sufficient to enable the Trust or a Series thereof to avoid or reduce liability.
SECTION 7.3. CONSTANT NET ASSET VALUE; REDUCTION OF OUTSTANDING SHARES. The
Trustees may determine to maintain the net asset value per Share of any Series
or Class at a designated constant amount and in connection therewith may adopt
procedures not inconsistent with the 1940 Act for the continuing declarations of
income attributable to that Series or Class as dividends payable in additional
Shares of that Series or Class or in cash or in any combination thereof and for
the handling of any losses attributable to that Series or Class. Such procedures
may provide that, if, for any reason, the income of any such Series or Class
determined at any time is a negative amount, the Trust may with respect to such
Series or Class (i) offset each Shareholder's pro rata share of such negative
amount from the accrued dividend account of such Shareholder, or (ii) reduce the
number of Outstanding Shares of such Series or Class by reducing the number of
Shares in the account of such Shareholder by that number of full and fractional
Shares which represents the amount of such excess negative income, or (iii)
cause to be recorded on the books of the Trust an asset account in the amount of
such negative income, which account may be reduced by the amount, provided that
the same shall thereupon become the property of the Trust with respect to such
Series or Class and shall not be paid to any Share holder, of dividends declared
thereafter upon the Outstanding Shares of such Series or Class on the day such
negative income is experienced, until such asset account is reduced to zero, or
(iv) combine the methods described in clauses (i), (ii) and (iii) of this
sentence, in order to cause the net asset value per Share of such Series or
Class to remain at a constant amount per Outstanding Share immediately after
such determination and declaration. The Trust may also fail to declare a
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dividend out of income for the purpose of causing the net asset value of
any such Share to be increased. The Trustees shall have full discretion to
determine whether any cash or property received shall be treated as income or as
principal and whether any item expense shall be charged to the income or the
principal account, and their determination made in good faith shall be
conclusive upon all Shareholders. In the case of stock dividends or similar
distributions received, the Trustees shall have full discretion to determine, in
the light of the particular circumstances, how much if any of the value thereof
shall be treated as income, the balance, if any, to be treated as principal.
SECTION 7.4. POWER TO MODIFY FOREGOING PROCEDURES. Notwithstanding any
provision contained in this Declaration, the Trustees may prescribe, in their
absolute discretion, such other means, methods, procedures or techniques for
determining the per Share net asset value of a Series or Class thereof or the
income of the Series or Class thereof, or for the declaration and payment of
dividends and distributions on any Series or Class of Shares.
ARTICLE VIII
DURATION; TERMINATION OF TRUST OR A
SERIES OR CLASS; MERGERS; AMENDMENTS
SECTION 8.1. DURATION. The Trust shall continue without limitation of time
but subject to the provisions of this Article VIII. The death, declination,
resignation, retirement, removal or incapacity of the Trustees, or any one of
them, shall not operate to terminate or annul the Trust or to revoke any
existing agency or delegation of authority pursuant to the terms of this
Declaration or of the By-Laws.
SECTION 8.2. TERMINATION OF THE TRUST OR A SERIES OR A CLASS. (a) The Trust
or any Series or Class thereof may be terminated by: (1) the affirmative vote of
the holders of not less than two-thirds of the Shares outstanding and entitled
to vote at any meeting of Shareholders of the Trust or the appropriate Series or
Class thereof, or by an instrument or instruments in writing without a meeting,
consented to by the holders of two-thirds of the Shares of the Trust or a Series
or Class thereof, provided, however, that, if such termination is recommended by
the Trustees, the vote of a majority of the outstanding voting securities of the
Trust or a Series or Class thereof entitled to vote thereon shall be sufficient
authorization; or (2) by means of an instrument in writing signed by a majority
of the Trustees, to be followed by a written notice to Shareholders stating that
a majority of the Trustees as determined that the continuation of the Trust or a
Series or a Class thereof is not in the best interest of the Trust, such Series
or Class or of their respective Shareholders. Such determination may (but need
not) be based on factors or events adversely affecting the ability of the Trust,
such Series or Class to conduct its business and operations in an economically
viable manner. Such factors and events may include (but are not limited to) the
inability of a Series or Class or the Trust to maintain its assets at an
appropriate size, changes in laws or regulations governing the Series or Class
or the Trust or affecting assets of the type in which such Series or Class or
the Trust invest, or political, social, legal or economic developments or trends
having an adverse impact on the business or operations of such Series or Class
or the Trust invests, or political, social, legal or economic developments or
trends having an adverse impact on the business or operations of such Series or
Class or the Trust. Upon the termination of the Trust or the Series or Class,
(i) The Trust, Series or Class 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, Series
or Class and all of the powers of the Trustees under this Declaration shall
continue until the affairs of the Trust, Series or Class shall have been wound
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up, including the power to fulfill or discharge the contracts of the Trust,
Series or Class, collect its assets, sell, convey, assign, exchange, transfer or
otherwise dispose of all or any part of the remaining Trust Property or assets
allocated or belonging to such Series or Class to one or more persons at public
or private sale for consideration which may consist in whole or in part of cash,
securities or other property of any kind, discharge or pay its liabilities, and
do all other acts appropriate to liquidate its business.
(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 or the remaining property of the
terminated Series or Class, in cash or in kind or in any combination thereof,
among the Shareholders of the Trust or the Series or Class according to their
respective rights.
(b) After termination of the Trust, Series or Class and distribution to the
Shareholders as herein provided, a majority of the Trustees shall execute and
lodge among the records of the Trust and file with the Massachusetts Secretary
of State an instrument in writing setting forth the fact of such termination,
and Trustees shall thereupon be discharged from all further liabilities and
duties with respect to the Trust or the terminated Series or Class, and rights
and interests of all Shareholders of the Trust or the terminated Series or
Class.
SECTION 8.3. MERGER, CONSOLIDATION OR SALE OF ASSETS OF A SERIES. A
particular Series may merge or consolidate with any other corporation,
association, trust or other organization or may sell, lease or exchange all or
substantially all of its property, including its good will, upon such terms and
conditions and for such consideration when and as authorized by the Trustees and
without any authorization, vote or consent of the Shareholders; and any such
merger, consolidation, sale, lease or exchange shall be deemed for all purposes
to have been accomplished under and pursuant to the statutes of the Commonwealth
of Massachusetts. The Trustees may also at any time sell and convert into money
all the assets of a particular Series. Upon making provision for the payment of
all outstanding obligations, taxes, and other liabilities, accrued or
contingent, of the particular Series, the Trustees shall distribute the
remaining assets of such Series among the Shareholders of such Series according
to their respective rights. Upon completion of the distribution of the remaining
proceeds or the remaining assets, the Series shall terminate and the Trustees
shall take the action provided in Section 8.2(b) hereof and they shall thereupon
be discharged from all further liabilities and duties with respect to such
Series, and the rights and interests of all Shareholders of the terminated
Series shall thereupon cease.
SECTION 8.4. AMENDMENTS. The execution of an instrument setting forth the
establishment and designation and the relative rights and preferences of any
Series or Class of Shares (or amending, restating or rescinding any such prior
instrument) in accordance with Section 5.5 hereof shall, without any
authorization, consent or vote of the Shareholders, effect an amendment of this
Declaration. Except as otherwise provided in this Section 8.4, if authorized by
vote of a majority of the outstanding voting securities of the Trust the
financial interests os which are affected by the amendment and which are
entitled to vote thereon (which securities shall, unless otherwise provided by
the Trustees, vote together on such amendment as a single class), the Trustees
may amend this Declaration by an instrument signed by a majority of the Trustees
then in office. No Shareholder not so affected by any such amendment shall be
entitled to vote thereon. The Trustees may (by such an instrument) also amend or
otherwise supplement this Declaration of Trust, without any authorization,
consent or vote of the Shareholders, to change the name of the Trust or any Fund
or to make such other changes as do not have a materially adverse effect on the
financial interests of Shareholders hereunder or if they deem it necessary or
desirable to conform this Declaration to the requirements of applicable federal
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or state laws or regulations or the requirements of the Internal Revenue
Code of 1986, but the Trustees shall not be liable for failing to do so. Any
such amendment or supplemental Declaration of Trust shall be effective as
provided in the instrument containing its terms or, if there is no provision
therein with respect to effectiveness, upon the signing of such instrument by a
majority of the Trustees then in office. Copies of any amendment or of any
supplemental Declaration of Trust shall be filed as specified in Section 10.2
hereof. 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.
Notwithstanding any other provision hereof, until such time as Shares are
issued and sold, this Declaration may be terminated or amended in any respect by
an instrument signed by a majority of the Trustees then in office.
ARTICLE X
MISCELLANEOUS
SECTION 10.1. USE OF THE WORDS "EATON VANCE". Eaton Vance Corp.
(hereinafter referred to as "EVC"), which owns (either directly or through
subsidiaries) all of the capital shares of the Investment Adviser of the Trust
and the Funds (or of the investment adviser or each of the investment companies
referred to in the last paragraph of Section 2.3), has consented to the use by
the Trust and the Funds of the identifying words "Eaton Vance" in the name of
the Trust and in the name of each Fund. Such consent is conditioned upon the
continued employment of EVC or a subsidiary or affiliate of EVC as Investment
Adviser of the Trust and of each such Fund or as the investment adviser of each
of the investment companies referred to in the last paragraph of Section 2.3. As
between the Trust and itself, EVC shall control the use of the name of the Trust
and the name of any Fund insofar as such name contains the identifying words
"Eaton Vance". EVC may from time to time use the identifying words "Eaton Vance'
in other connections and for other purposes, including, without limitation, in
the names of other investment companies, trusts corporations or businesses which
it may manage, advise, sponsor or own or in which it may have a financial
interest. EVC may require the Trust to cease using the identifying words "Eaton
Vance" in the name of the Trust or any Fund if EVC or a subsidiary or affiliate
of EVC ceases to act as investment adviser of the Trust or such Fund or as the
investment adviser of each of the investment companies referred to in the last
paragraph of Section 2.3.
SECTION 10.2. FILING OF COPIES, REFERENCES, HEADINGS AND COUNTERPARTS. The
original or a copy of this instrument, of any amendment hereto and of each
declaration of trust supplemental hereto, shall be kept at the office of the
Trust. A copy of this instrument, of any amendment hereto, and of each
supplemental declaration of trust shall be filed with the Massachusetts
Secretary of State and with any other governmental office where such filing may
from time to time be required. Anyone dealing with the Trust may rely on a
certificate by a Trustee or an officer of the Trust as to whether or not any
such amendments or supplemental declarations of trust have been made and as to
any matters in connection with the Trust hereunder, and with the same effect as
if it were the original, may rely on a copy certified by a Trustee or an officer
of the Trust to be a copy of this instrument or of any such amendment hereto or
supplemental declaration of trust.
In this instrument or in any such amendment or supplemental declaration of
trust, references to this instrument, and all expressions such as "herein",
"hereof", and "hereunder", shall be deemed to refer to this instrument as
amended or affected by any such supplemental declaration of trust. Headings are
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placed herein for convenience of reference only and in case of any
conflict, the text of this instrument, rather than the headings, shall control.
This instrument may be executed in any number of counterparts each of which
shall be deemed an original, but such counterparts shall constitute one
instrument. A restated Declaration, integrating into a single instrument all of
the provisions of the Declaration which are then in effect and operative, may be
executed from time to time by a majority of the Trustees then in office and
filed with the Massachusetts Secretary of State. A restated Declaration shall,
upon execution, be conclusive evidence of all amendments and supplemental
declarations contained therein and may hereafter be referred to in lieu of the
original Declaration and the various amendments and supplements thereto.
SECTION 10.3. APPLICABLE LAW. The Trust set forth in this instrument is
made in the Commonwealth of Massachusetts, and it is created under and is to be
governed by and construed and administered according to the laws of said
Commonwealth. The Trust shall be of the type commonly called a Massachusetts
business trust, and without limiting the provisions hereof, the Trust may
exercise all powers which are ordinarily exercised by such a trust.
SECTION 10.4. PROVISIONS IN CONFLICT WITH LAW OR REGULATIONS. (a) The
provisions of this Declaration are severable, and if the Trustees shall
determine, with the advice of legal counsel, that any of such provisions is in
conflict with the 1940 Act, the Internal Revenue Code of 1986 or with other
applicable laws and regulations, the conflicting provision shall be deemed never
to have constituted a part of this Declaration; provided, however, that such
determination shall not affect an of the remaining provisions of this
Declaration or render invalid or improper any action taken or omitted prior to
such determination
(b) If any provision of this Declaration shall be held invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall
attach only to such provision in such jurisdiction and shall not in any manner
affect such provisions in any other jurisdiction or any other provision of this
Declaration in any jurisdiction.
IN WITNESS WHEREOF, the undersigned, being a majority of the Trustees
of the Trust, have executed this instrument this 24th day of June, 1996.
/s/ Landon T. Clay /s/ Norton H. Reamer
- ---------------------------- -------------------------
Landon T. Clay Norton H. Reamer
/s/ Donald R. Dwight /s/ John L. Thorndike
- ---------------------------- -------------------------
Donald R. Dwight John L. Thorndike
/s/ Samuel L. Hayes, III /s/ Jack L. Treynor
- --------------------------- -------------------------
Samuel L. Hayes, III Jack L. Treynor
21
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THE COMMONWEALTH OF MASSACHUSETTS
Suffolk, ss. Boston, Massachusetts
Then personally appeared the above named Landon T. Clay, Donald R. Dwight,
Samuel L. Hayes, III, John L. Thorndike and Jack L. Treynor being a majority of
the Trustees then in office, who severally acknowledge the foregoing instrument
to be their free act and deed.
Before me,
/s/ Lynne M. Hetu
-----------------------------
My commission expires 7/31/98
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The names and addresses of all the Trustees of the Trust are as follows:
Landon T. Clay Samuel L. Hayes, III
Old Dublin Road 345 Nahatan Street
Hancock, NH 03449 Westwood, MA 02090
Donald R. Dwight Norton H. Reamer
Clover Mill Lane 70 Circuit Road
Lyme, NH 03768 Chestnut Hill, MA 02167
Jack L. Treynor John L. Thorndike
504 Via Almar 10 Main Street
Palos Verdes Estates, CA 90274 Dover, MA 02030
Trust Address:
24 Federal St
Boston, MA 021102
23
BY-LAWS
OF
EATON VANCE SERIES TRUST
ARTICLE I
The Trustees
SECTION 1. INITIAL TRUSTEES, ELECTION AND TERM OF OFFICE. The Trustees named in
the preamble of the Declaration of Trust dated June 24, 1996, as from time to
time amended (the "Declaration of Trust"), and any additional Trustees appointed
pursuant to Section 4 of this Article I, shall serve as Trustees during the
lifetime of the Trust, except as otherwise provided below.
SECTION 2. NUMBER OF TRUSTEES. The number of Trustees shall be fixed by the
Trustees, provided, however, that such number shall at no time exceed eighteen.
SECTION 3. RESIGNATION AND REMOVAL. Any Trustee may resign his trust by written
instrument signed by him and delivered to the other Trustees, which shall take
effect upon such delivery or upon such later date as is specified therein. Any
Trustee who requests in writing to be retired or who has become incapacitated by
illness or injury may be retired by written instruments signed by a majority of
the other Trustees, specifying the date of his retirement. Any Trustee may be
removed at any time by written instrument, signed by at least two-thirds of the
number of Trustees prior to such removal, specifying the date when such removal
shall become effective.
No natural person shall serve as a Trustee of the Trust after the holders
of record of not less than two-thirds of the outstanding shares of beneficial
interest of the Trust (the "shares") have declared that he be removed from that
office by a declaration in writing signed by such holders and filed with the
Custodian of the assets of the Trust or by votes cast by such holders in person
or by proxy at a meeting called for the purpose. Solicitation of such a
declaration shall be deemed a solicitation of a proxy within the meaning of
Section 20(a) of the Investment Company Act of 1940 (the "Act").
The Trustees of the Trust shall promptly call a meeting of the shareholders
for the purpose of voting upon a question of removal of any such Trustee or
Trustees when requested in writing so to do by the record holders of not less
than 10 per centum of the outstanding shares.
Whenever ten or more shareholders of record of the Trust who have been such
for at least six months preceding the date of application, and who hold in the
aggregate either shares having a net asset value of at least $25,000 or at least
1 per centum of the outstanding shares, whichever is less, shall apply to the
Trustees in writing, stating that they wish to communicate with other
shareholders with a view to obtaining signatures to a request for a meeting of
shareholders pursuant to this Section 3 and accompanied by a form of
communication and request which they wish to transmit, the Trustees shall within
five business days after receipt of such application either
(1) afford to such applicants access to a list of the names and addresses
of all shareholders as recorded on the books of the Trust; or
<PAGE>
2
(2) inform such applicants as to the approximate number of shareholders of
record, and the approximate cost of mailing to them the proposed communication
and form of request.
If the Trustees elect to follow the course specified in subparagraph (2)
above of this Section 3, the Trustees, upon the written request of such
applicants, accompanied by a tender of the material to be mailed and of the
reasonable expenses of mailing, shall, with reasonable promptness, mail such
material to all shareholders of record at their addresses as recorded on the
books, unless within five business days after such tender the Trustees shall
mail to such applicants and file with the Securities and Exchange Commission
(the "Commission"), together with a copy of the material to be mailed, a written
statement signed by at least a majority of the Trustees to the effect that in
their opinion either such material contains untrue statements of fact or omits
to state facts necessary to make the statements contained therein not
misleading, or would be in violation of applicable law, and specifying the basis
of such opinion.
After the Commission has had an opportunity for hearing upon the objections
specified in the written statement so filed by the Trustees, the Trustees or
such applicants may demand that the Commission enter an order either sustaining
one or more of such objections or refusing to sustain any of such objections. If
the Commission shall enter an order refusing to sustain any of such objections,
or if, after the entry of an order sustaining one or more of such objections,
the Commission shall find, after notice and opportunity for hearing, that all
objections so sustained have been met, and shall enter an order so declaring,
the Trustees shall mail copies of such material to all shareholders with
reasonable promptness after the entry of such order and the renewal of such
tender.
Until such provisions become null, void, inoperative and removed from these
By-Laws pursuant to the next sentence, the provisions of all but the first
paragraph of this Section 3 may not be amended or repealed without the vote of a
majority of the Trustees and a majority of the outstanding shares of the Trust.
These same provisions shall be deemed null, void, inoperative and removed from
these By-Laws upon the effectiveness of any amendment to the Act which
eliminates them from Section 16 of the Act or the effectiveness of any successor
Federal law governing the operation of the Trust which does not contain such
provisions.
SECTION 4. VACANCIES. In case of the declination, death, resignation,
retirement, removal, or inability of any of the Trustees, or in case a vacancy
shall, by reason of an increase in number, or for any other reason, exist, the
remaining Trustees shall fill such vacancy by appointing such other person as
they in their discretion shall see fit. Such appointment shall be evidenced by a
written instrument signed by a majority of the Trustees in office whereupon the
appointment shall take effect. Within three months of such appointment the
Trustees shall cause notice of such appointment to be mailed to each shareholder
at his address as recorded on the books of the Trustees. An appointment of a
Trustee may be made by the Trustees then in office and notice thereof mailed to
shareholders as aforesaid in anticipation of a vacancy to occur by reason of
retirement, resignation or increase in number of Trustees effective at a later
date, provided that said appointment shall become effective only at or after the
effective date of said retirement, resignation or increase in number of
Trustees. As soon as any Trustee so appointed shall have accepted this trust,
the trust estate shall vest in the new Trustee or Trustees, together with the
continuing Trustees, without any further act or conveyance, and he shall be
deemed a Trustee hereunder and under the Declaration of Trust. The power of
appointment is subject to the provisions of Section 16(a) of the Act.
Whenever a vacancy among the Trustees shall occur, until such vacancy is
filled, or while any Trustee is absent from the Commonwealth of Massachusetts
or, if not a domiciliary of Massachusetts, is absent from his state of domicile,
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3
or is physically or mentally incapacitated by reason of disease or
otherwise, the other Trustees shall have all the powers hereunder and the
certificate of the other Trustees of such vacancy, absence or incapacity shall
be conclusive, provided, however, that no vacancy shall remain unfilled for a
period longer than six calendar months.
SECTION 5. TEMPORARY ABSENCE OF TRUSTEE. Any Trustee may, by power of attorney,
delegate his power for a period not exceeding six months at any one time to any
other Trustee or Trustees, provided that in no case shall less than two Trustees
personally exercise the other powers hereunder except as herein otherwise
expressly provided.
SECTION 6. EFFECT OF DEATH, RESIGNATION, REMOVAL, ETC. OF A TRUSTEE. The
death, declination, resignation, retirement, removal, or incapacity of the
Trustees, or any one of them, shall not operate to annul the Trust or to revoke
any existing agency created pursuant to the terms of the Declaration of Trust or
these By-Laws.
ARTICLE II
Officers and Their Election
SECTION 1. OFFICERS. The officers of the Trust shall be a President, a
Treasurer, a Secretary, and such other officers or agents as the Trustees may
from time to time elect. It shall not be necessary for any Trustee or other
officer to be a holder of shares in the Trust.
SECTION 2. ELECTION OF OFFICERS. The Treasurer and Secretary shall be
chosen annually by the Trustees. The President shall be chosen annually by and
from the Trustees.
Except for the offices of President and Secretary, two or more offices may
be held by a single person. The officers shall hold office until their
successors are chosen and qualified.
SECTION 3. RESIGNATIONS AND REMOVALS. Any officer of the Trust may resign by
filing a written resignation with the President or with the Trustees or with the
Secretary, which shall take effect on being so filed or at such time as may
otherwise be specified therein. The Trustees may at any meeting remove an
officer.
ARTICLE III
Powers and Duties of Trustees and Officers
SECTION 1. TRUSTEES. The business and affairs of the Trust shall be managed by
the Trustees, and they shall have all powers necessary and desirable to carry
out that responsibility, so far as such powers are not inconsistent with the
laws of the Commonwealth of Massachusetts, the Declaration of Trust, or these
By-Laws.
SECTION 2. EXECUTIVE AND OTHER COMMITTEES. The Trustees may elect from their own
number an executive committee to consist of not less than three nor more than
five members, which shall have the power and duty to conduct the current and
ordinary business of the Trust, including the purchase and sale of securities,
while the Trustees are not in session, and such other powers and duties as the
Trustees may from time to time delegate to such committee. The Trustees may also
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4
elect from their own number other committees from time to time, the number
composing such committees and the powers conferred upon the same to be
determined by the Trustees.
SECTION 3. CHAIRMAN OF THE TRUSTEES. The Trustees may, but need not, appoint
from among their number a Chairman. When present he shall preside at the
meetings of the shareholders and of the Trustees. He may call meetings of the
Trustees and of any committee thereof whenever he deems it necessary. He shall
be an executive officer of this Trust and shall have, with the President,
general supervision over the business and policies of this Trust, subject to the
limitations imposed upon the President, as provided in Section 4 of this Article
III.
SECTION 4. PRESIDENT. In the absence of the Chairman of the Trustees, the
President shall preside at all meetings of the shareholders. Subject to the
Trustees and to any committees of the Trustees, within their respective spheres,
as provided by the Trustees, he shall at all times exercise a general
supervision and direction over the affairs of the Trust. He shall have the power
to employ attorneys and counsel for the Trust and to employ such subordinate
officers, agents, clerks and employees as he may find necessary to transact the
business of the Trust. He shall also have the power to grant, issue, execute or
sign such powers of attorney, proxies or other documents as may be deemed
advisable or necessary in furtherance of the interests of the Trust. The
President shall have such other powers and duties as, from time to time, may be
conferred upon or assigned to him by the Trustees.
SECTION 5. TREASURER. The Treasurer shall be the principal financial and
accounting officer of the Trust. He shall deliver all funds and securities of
the Trust which may come into his hands to such bank or trust company as the
Trustees shall employ as custodian in accordance with Article VII of the
Declaration of Trust. He shall make annual reports in writing of the business
conditions of the Trust, which reports shall be preserved upon its records, and
he shall furnish such other reports regarding the business and condition as the
Trustees may from time to time require. The Treasurer shall perform such duties
additional to foregoing as the Trustees may from time to time designate.
SECTION 6. SECRETARY. The Secretary shall record in books kept for the purpose
all votes and proceedings of the Trustees and the shareholders at their
respective meetings. He shall have custody of the seal, if any, of the Trust and
shall perform such duties additional to the foregoing as the Trustees may from
time to time designate.
SECTION 7. OTHER OFFICERS. Other officers elected by the Trustees shall
perform such duties as the Trustees may from time to time designate.
SECTION 8. COMPENSATION. The Trustees and officers of the Trust may receive
such reasonable compensation from the Trust for the performance of their duties
as the Trustees may from time to time determine.
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5
ARTICLE IV
Meetings of Shareholders
SECTION 1. MEETINGS. Meetings of the shareholders may be called at any time by
the President, and shall be called by the President or the Secretary at the
request, in writing or by resolution, of a majority of the Trustees, or at the
written request of the holder or holders of ten percent (10%) or more of the
total number of shares of the then issued and outstanding shares of the Trust
entitled to vote at such meeting. Any such request shall state the purposes of
the proposed meeting.
SECTION 2. PLACE OF MEETINGS. Meetings of the shareholders shall be held at the
principal place of business of the Trust in Boston, Massachusetts, unless a
different place within the United States is designated by the Trustees and
stated as specified in the respective notices or waivers of notice with respect
thereto.
SECTION 3. NOTICE OF MEETINGS. Notice of all meetings of the shareholders,
stating the time, place and the purposes for which the meetings are called,
shall be given by the Secretary to each shareholder entitled to vote thereat,
and to each shareholder who under the By-Laws is entitled to such notice, by
mailing the same postage paid, addressed to him at his address as it appears
upon the books of the Trust, at least seven (7) days before the time fixed for
the meeting, and the person giving such notice shall make an affidavit with
respect thereto. If any shareholder shall have failed to inform the Trust of his
post office address, no notice need be sent to him. No notice need be given to
any shareholder if a written waiver of notice, executed before or after the
meeting by the shareholder or his attorney thereunto authorized, is filed with
the records of the meeting.
SECTION 4. QUORUM. Except as otherwise provided by law, to constitute a quorum
for the transaction of any business at any meeting of shareholders, there must
be present, in person or by proxy, holders of a majority of the total number of
shares of the then issued and outstanding shares of the Trust entitled to vote
at such meeting; provided that if a series of shares is entitled to vote as a
separate series on any matter, then in the case of that matter a quorum shall
consist of the holders of a majority of the total number of shares of the then
issued and outstanding shares of that series entitled to vote at the meeting.
Shares owned directly or indirectly by the Trust, if any, shall not be deemed
outstanding for this purpose.
If a quorum, as above defined, shall not be present for the purpose of any
vote that may properly come before any meeting of shareholders at the time and
place of any meeting, the shareholders present in person or by proxy and
entitled to vote at such meeting on such matter holding a majority of the shares
present and entitled to vote on such matter may by vote adjourn the meeting from
time to time to be held at the same place without further notice than by
announcement to be given at the meeting until a quorum, as above defined,
entitled to vote on such matter, shall be present, whereupon any such matter may
be voted upon at the meeting as though held when originally convened.
SECTION 5. VOTING. At each meeting of the shareholders every shareholder of the
Trust who shall be entitled to one (1) vote in person or by proxy for each of
the then issued and outstanding shares of the Trust then having voting power in
respect of the matter upon which the vote is to be taken, standing in his name
on the books of the Trust at the time of the closing of the transfer books for
the meeting, or, if the books be not closed for any meeting, on the record date
fixed as provided in Section 4 of Article VI of these By-Laws for determining
the shareholders entitled to vote at such meeting, or if the books be not closed
and no record date be fixed, at the time of the meeting. The record holder of a
fraction of a share shall be entitled in like manner to a corresponding fraction
<PAGE>
6
of a vote. Notwithstanding the foregoing, the Trustees may, in conjunction
with the establishment of any series of shares, establish conditions under which
the several series shall have separate voting rights or no voting rights.
All elections of Trustees shall be conducted in any manner approved at the
meeting of the shareholders at which said election is held, and shall be by
ballot if so requested by any shareholder entitled to vote thereon. The persons
receiving the greatest number of votes shall be deemed and declared elected.
Except as otherwise required by law or by the Declaration of Trust or by these
By-Laws, all matters shall be decided by a majority of the votes cast, as
hereinabove provided, by persons entitled to vote thereon. With respect to the
submission of a management or investment advisory contract or a change in
investment policy to the shareholders for any shareholder approval required by
the Act, such matter shall be deemed to have been effectively acted upon with
respect to any series of shares if the holders of the lesser of
(i) 67 per centum or more of the shares of that
series present or represented at the meeting if the
holders of more than 50 per centum of the outstanding
shares of that series are present or represented by
proxy at the meeting or
(ii) more than 50 per centum of the outstanding shares
of that series
vote for the approval of such matter, notwithstanding (a) that such matter has
not been approved by the holders of a majority of the outstanding voting
securities of any other series affected by such matter (as described in rule
18f-2 under the Act) or (b) that such matter has not been approved by the vote
of a majority of the outstanding voting securities of the Trust (as defined in
the Act).
SECTION 6. PROXIES. Any shareholder entitled to vote upon any matter at any
meeting of the shareholders may so vote by proxy. A proxy may be in writing
subscribed by the shareholder or by his duly authorize representative, agent or
attorney. A written proxy shall be dated; if an undated written proxy solicited
by the management of the Trust is delivered to the Trust or its agent or
representative, such proxy shall be deemed dated by the shareholder on the date
of its receipt by the Trust or its agent or representative. A written proxy need
not be sealed, witnessed or acknowledged. The shareholder may also authorize and
empower the persons named as proxies, representatives, agents or attorneys (or
their duly appointed substitutes), or any one of them on any form of proxy
solicited by the management of the Trust to vote all shares of the Trust which
he is entitled to vote upon any matter at any meeting of the shareholders by
recording his voting instructions on any recording device maintained for the
purpose by the Trust or its agent or representative; such recorded instructions
shall be deemed to constitute a written proxy subscribed by the shareholder and
delivered by him to the Trust or its agent or representative and shall be deemed
to be dated as of the date such instructions were transmitted, and the
shareholder shall be deemed to have approved and ratified all actions taken by
such persons in accordance with the voting instructions so recorded. No proxy
which is dated (or deemed dated) more than six months before the initial session
of the meeting shall be accepted and no such proxy shall be valid after the
final adjournment of the meeting. A proxy solicited by the management of the
Trust purpoting to be executed or transmitted by or on behalf of a shareholder
shall be valid unless challenged at or prior to exercise of the proxy, and the
burden of proving any inalidity shall be borne by the perosn asserting the
challenge. A proxy solicited by the management of the Trust with respect to
shares held in the name of two or more persons shall be valid if executed or
<PAGE>
7
transmitted by one of them unless at or prior to its exercise the Trust
receives a specific written notice to the contrary from any one of them.
SECTION 7. CONSENTS. Any action which may be taken by shareholders may be taken
without a meeting if a majority of shareholders entitled to vote on the matter
(or such larger proportion thereof as shall be required by law, the Declaration
of Trust or these By-Laws for approval of such matter) consent to the action in
writing and the written consents are filed with the records of the meetings of
shareholders. Such consents shall be treated for all purposes as a vote taken at
a meeting of shareholders.
ARTICLE V
Trustees Meetings
SECTION 1. MEETINGS. The Trustees may in their discretion provide for regular or
stated meetings of the Trustees. Meetings of the Trustees other than regular or
stated meetings shall be held whenever called by the Chairman, President or by
any other Trustee at the time being in office. Any or all of the Trustees may
participate in a meeting by means of a conference telephone or similar
communications equipment through which all persons participating in the meeting
can hear each other at the same time, and participation by such means shall
constitute presence in person at a meeting.
SECTION 2. NOTICES. Notice of regular or stated meetings need not be given.
Notice of the time and place of each meeting other than regular or stated
meetings shall be given by the Secretary or by the Trustee calling the meeting
and shall be mailed to each Trustee at least two (2) days before the meeting, or
shall be telegraphed, cabled, or wirelessed to each Trustee at his business
address or personally delivered to him at least one (1) day before the meeting.
Such notice may, however, be waived by all the Trustees. Notice of a meeting
need not be given to any Trustee if a written waiver of notice, executed by him
before or after the meeting, is filed with the records of the meeting, or to any
Trustee who attends the meeting without protesting prior thereto or at its
commencement the lack of notice to him. A notice or waiver of notice need not
specify the purpose of any special meeting.
SECTION 3. CONSENTS. Any action required or permitted to be taken at any meeting
of the Trustees may be taken by the Trustees without a meeting if a written
consent thereto is signed by all the Trustees and filed with the records of the
Trustees' meetings. Such consent shall be treated as a vote at a meeting for all
purposes.
SECTION 4. PLACE OF MEETINGS. The Trustees may hold their meetings within
or without the Commonwealth of Massachusetts.
SECTION 5. QUORUM AND MANNER OF ACTING. A majority of the Trustees in office
shall be present in person at any regular stated or special meeting of the
Trustees in order to constitute a quorum for the transaction of business at such
meeting and (except as otherwise required by the Declaration of Trust, by these
By-Laws or by statute) the act of a majority of the Trustees present at any such
meeting, at which a quorum is present, shall be the act of the Trustees. In the
absence of quorum, a majority of the Trustees present may adjourn the meeting
from time to time until a quorum shall be present. Notice of any adjourned
meeting need not be given.
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8
ARTICLE VI
Shares of Beneficial Interest
SECTION 1. CERTIFICATES FOR SHARES OF BENEFICIAL INTEREST. Certificates for
shares of beneficial interest of any series of shares of the Trust, if issued,
shall be in such form as shall be approved by the Trustees. They shall be signed
by, or in the name of, the Trust by the President and by the Treasurer and may,
but need not be, sealed with seal of the Trust; provided, however, that where
such certificate is signed by a transfer agent or a transfer clerk acting on
behalf of the Trust or a registrar other than a Trustee, officer or employee of
the Trust, the signature of the President and Treasurer and the seal may be
facsimile. In case any officer or officers who shall have signed, or whose
facsimile signature or signatures shall have been used on any such certificate
or certificates, shall cease to be such officer or officers of the Trust whether
because of death, resignation or otherwise, before such certificate or
certificates shall have been delivered by the Trust, such certificate or
certificates may nevertheless be adopted by the Trust and be issued and
delivered as though the person or persons who signed such certificate or
certificates or whose facsimile signatures shall have been used thereon had not
ceased to be such officer or officers of the Trust.
SECTION 2. TRANSFER OF SHARES. Transfers of shares of beneficial interest of any
series of shares of the Trust shall be made only on the books of the Trust by
the owner thereof or by his attorney thereunto authorized by a power of attorney
duly executed and filed with the Secretary or a transfer agent, and only upon
the surrender of any certificate or certificates for such shares. The Trust
shall not impose any restrictions upon the transfer of the shares of any series
of the Trust, but this requirement shall not prevent the charging of customary
transfer agent fees.
SECTION 3. TRANSFER AGENT AND REGISTRAR; REGULATIONS. The Trust shall, if and
whenever the Trustees shall so determine, maintain one or more transfer offices
or agencies, each in the charge of a transfer agent designated by the Trustees,
where the shares of beneficial interest of the Trust shall be directly
transferable. The Trust shall, if and whenever the Trustees shall so determine,
maintain one or more registry offices, each in the charge of a registrar
designated by the Trustees, where such shares shall be registered, and no
certificate for shares of the Trust in respect of which a transfer agent and/or
registrar shall have been designated shall be valid unless countersigned by such
transfer agent and/or registered by such registrar. The principal transfer agent
may be located within or without the Commonwealth of Massachusetts and shall
have charge of the share transfer books, lists and records, which shall be kept
within or without Massachusetts in an office which shall be deemed to be the
share transfer office of the Trust. The Trustees may also make such additional
rules and regulations as it may deem expedient concerning the issue, transfer
and redemption of certificates for shares of the Trust.
SECTION 4. CLOSING OF TRANSFER BOOKS AND FIXING RECORD DATE. The Trustees may
fix in advance a time which shall be not more than sixty (60) days before the
date of any meeting of shareholders, or the date for the payment of any dividend
or the making of any distribution to shareholders or the last day on which the
consent or dissent of shareholders may be effectively expressed for any purpose,
as the record date for determining the shareholders having the right to notice
of and to vote at such meeting, and any adjournment thereof, or the right to
receive such dividend or distribution or the right to give such consent or
dissent, and in such case only shareholders of record on such record date shall
have such right, notwithstanding any transfer of shares on the books of the
Trust after the record date. The Trustees may, without fixing such record date,
close the transfer books for all or any part of such period for any of the
foregoing purposes.
<PAGE>
9
SECTION 5. LOST, DESTROYED OR MUTILATED CERTIFICATES. The holder of any shares
of a series of the Trust shall immediately notify the Trust of any loss,
destruction or mutilation of the certificate therefor, and the Trustees may, in
their discretion, cause new certificate or certificates to be issued to him, in
case of mutilation of the certificate, upon the surrender of the mutilated
certificate, or, in case of loss or destruction of the certificate, upon
satisfactory proof of such loss or destruction and, in any case, if the Trustees
shall so determine, upon the delivery of a bond in such form and in such sum and
with such surety or sureties as the Trustees may direct, to indemnify the Trust
against any claim that may be made against it on account of the alleged loss or
destruction of any such certificate.
SECTION 6. RECORD OWNER OF SHARES. The Trust shall be entitled to treat the
person in whose name any share of a series of the Trust is registered on the
books of the Trust as the owner thereof, and shall not be bound to recognize any
equitable or other claim to or interest in such share or shares on the part of
any other person.
ARTICLE VII
Fiscal Year
The fiscal year of the Trust shall end on December 31, of each year,
provided, however, that the Trustees may from time to time change the fiscal
year.
ARTICLE VIII
Seal
The Trustees may adopt a seal of the Trust which shall be in such form and
shall have such inscription thereon as the Trustees may from time to time
prescribe.
ARTICLE IX
Inspection of Books
The Trustees shall from time to time determine whether and to what extent,
and at what times and places, and under what conditions and regulations the
accounts and books of the Trust or any of them shall be open to the inspection
of the shareholders; and no shareholder shall have any right of inspecting any
account or book or document of the Trust except as conferred by law or
authorized by the Trustees or by resolution of the shareholders.
ARTICLE X
Custodian
The following provisions shall apply to the employment of the Custodian
pursuant to Article VII of the Declaration of Trust and to any contract entered
into with the Custodian so employed:
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10
(a) The Trustees shall cause to be delivered to the Custodian all
securities owned by the Trust or to which it may become entitled, and shall
order the same to be delivered by the Custodian only in completion of a sale,
exchange, transfer, pledge, loan, or other disposition thereof, against receipt
by the Custodian of the consideration therefor or a certificate of deposit or a
receipt of an issuer or of its transfer agent, or to a securities depository as
defined in Rule 17f-4 under the Act, all as the Trustees may generally or from
time to time require or approve, or to a successor Custodian; and the Trustees
shall cause all funds owned by the Trust or to which it may become entitled to
be paid to the Custodian, and shall order the same disbursed only for investment
against delivery of the securities acquired, or in payment of expenses,
including management compensation, and liabilities of the Trust, including
distributions to shareholders, or to a successor Custodian.
(b) In case of the resignation, removal or inability to serve of any such
Custodian, the Trustees shall promptly appoint another bank or trust company
meeting the requirements of said Article VII as successor Custodian. The
agreement with the Custodian shall provide that the retiring Custodian shall,
upon receipt of notice of such appointment, deliver the funds and property of
the Trust in its possession to and only to such successor, and that pending
appointment of a successor Custodian, or a vote of the shareholders to function
without a Custodian, the Custodian shall not deliver funds and property of the
Trust to the Trustees, but may deliver them to a bank or trust company doing
business in Boston, Massachusetts, of its own selection, having an aggregate
capital, surplus and undivided profits, as shown by its last published report,
of not less than $2,000,000, as the property of the Trust to be held under terms
similar to those on which they were held by the retiring Custodian.
ARTICLE XI
Limitation of Liability and Indemnification
SECTION 1. LIMITATION OF LIABILITY. Provided they have exercised reasonable care
and have acted under the reasonable belief that their actions are in the best
interest of the Trust, the Trustees shall not be responsible for or liable in
any event for neglect or wrongdoing of them or any officer, agent, employee or
investment adviser of the Trust, but nothing contained in the Declaration of
Trust or herein shall protect any Trustee against any liability to which he
would otherwise be subject by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of his
office.
SECTION 2. INDEMNIFICATION OF TRUSTEES AND OFFICERS. The Trust shall indemnify
each person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, by reason of the fact that he is or
has been a Trustee, officer, employee or agent of the Trust, or is or has been
serving at the request of the Trust as a Trustee, director, officer, employee or
agent of another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by him in connection
with such action, suit or proceeding, provided that:
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11
(a) such person acted in good faith and in a manner he reasonably believed
to be in or not opposed to the best interests of the Trust,
(b) with respect to any criminal action or proceeding, he had not
reasonable cause to believe his conduct was unlawful,
(c) unless ordered by a court, indemnification shall be made only as
authorized in the specific case upon a determination that indemnification of the
Trustee, officer, employee or agent is proper in the circumstances because he
has met the applicable standard of conduct set forth in subparagraphs (a) and
(b) above and (e) below, such determination to be made based upon a review of
readily available facts (as opposed to a full trial-type inquiry) by (i) vote of
a majority of the Disinterested Trustees acting on the matter (provided that a
majority of the Disinterested Trustees then in office act on the matter) or (ii)
by independent legal counsel in a written opinion.
(d) in the case of an action or suit by or in the right of the Trust to
procure a judgment in its factor, no indemnification shall be made in respect of
any claim, issue or matter as to which such person shall have been adjudged to
be liable for negligence or misconduct in the performance of his duty to the
Trust unless and only to the extent that the court in which such action or suit
is brought, or a court of equity in the county in which the Trust has its
principal office, shall determine upon application that, despite the
adjudication of liability but in view of all the circumstances of the case, he
is fairly and reasonably entitled to indemnity for such expenses which such
court shall deem proper, and
(e) no indemnification or other protection shall be made or given to any
Trustee or officer of the Trust against any liability to the Trust or to its
security holders to which he would otherwise be subject by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of his office.
Expenses (including attorneys' fees) incurred with respect to any claim,
action, suit or proceeding of the character described in the preceding paragraph
shall be paid by the Trust in advance of the final disposition thereof upon
receipt of an undertaking by or on behalf of such person to repay such amount
unless it shall ultimately be determined that he is entitled to be indemnified
by the Trust as authorized by this Article, provided that either:
(1) such undertaking is secured by a surety bond or some other appropriate
security provided by the recipient, or the Trust shall be insured against losses
arising out of any such advances; or
(2) a majority of the Disinterested Trustees acting on the matter (provided
that a majority of the Disinterested Trustees act on the matter) or an
independent legal counsel in a written opinion shall determine, based upon a
review of readily available facts (as opposed to a full trial-type inquiry),
that there is reason to believe that the recipient ultimately will be found
entitled to indemnification.
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As used in this Section 2, a "Disinterested Trustee" is one who is not (i)
an "Interested Person", as defined in the Act, of the Trust (including anyone
who has been exempted from being an "Interested Person" by any rule, regulation,
or order of the Securities and Exchange Commission), or (ii) involved in the
claim, action, suit or proceeding.
The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that the person did not act in good
faith and in a manner which he reasonably believed to be in or not opposed to
the best interests of the Trust, or with respect to any criminal action or
proceeding, had reasonable cause to believe that his conduct was unlawful.
For the purpose of this ARTICLE XI, Trustees, officers, employees and
agents of the Trust shall also mean the Directors, officers, employees and
agents of the Trust's predecessor, Eaton Vance Special Equities Fund, Inc.
SECTION 3. INDEMNIFICATION OF SHAREHOLDERS. In case any shareholder or former
shareholder shall be held to be personally liable solely by reason of his being
or having been a shareholder and not because of his acts or omissions or for
some other reason, the shareholder or former shareholder (or his heirs,
executors, administrators or other legal representatives or, in the case of a
corporation or other entity, its corporate or other general successor) shall be
entitled out of the Trust estate to be held harmless from and indemnified
against all loss and expense arising from such liability. The Trust shall, upon
request by the shareholder, assume the defense of any claim made against any
shareholder for any act or obligation of the Trust and satisfy any judgment
thereon. A holder of shares of a series shall be entitled to indemnification
hereunder only out of assets allocated to that series.
ARTICLE XII
Underwriting Arrangements
Any contract entered into for the sale of shares of the Trust pursuant to
Article VIII, Section 2 of the Declaration of Trust shall require the other
party thereto (hereinafter called the "underwriter") whether acting as principal
or as agent to use reasonable efforts, consistent with the other business of the
underwriter, to secure purchasers for the shares of the Trust.
The underwriter may be granted the right
(a) To purchase as principal, from the Trust, at not less than net asset
value per share, the shares needed, but no more than the shares needed (except
for clerical errors and errors of transmission), to fill unconditional orders
for shares of the Trust received by the underwriter.
(b) To purchase as principal, from shareholders of the Trust at not less
than net asset value per share (minus any applicable sales charge payable upon
redemption or repurchase of shares) such shares as may be presented to the
Trust, or the transfer agent of the Trust, for redemption and as may be
determined by the underwriter in its sole discretion.
<PAGE>
13
(c) to resell any such shares purchased at not less than net asset value
per share (minus any applicable sales charge payable upon redemption or
repurchase of shares).
ARTICLE XIII
Report to Shareholders
The Trustees shall at least semi-annually submit to the shareholders a
written financial report of the transactions of the Trust including financial
statements which shall at least annually be certified by independent public
accountants.
ARTICLE XIV
Certain Transactions
SECTION 1. LONG AND SHORT POSITIONS. Except as hereinafter provided, no officer
or Trustee and no partner, officer, director or shareholder of the manager, or
investment adviser of the Trust or of the underwriter of the Trust, and no
manager, or investment adviser or underwriter of the Trust, shall take long or
short positions in the securities issued by the Trust.
(a) The foregoing provision shall not prevent the underwriter from
purchasing shares of the Trust from the Trust if such purchases are limited
(except for reasonable allowances for clerical errors, delays and errors of
transmission and cancellation of orders) to purchases for the purpose of filling
orders for such shares received by the underwriter, and provided that orders to
purchase from the Trust are entered with the Trust or the Custodian promptly
upon receipt by the underwriter of purchase orders for such shares, unless the
underwriter is otherwise instructed by its customer.
(b) The foregoing provision shall not prevent the underwriter from
purchasing shares of the Trust as agent for the account of the Trust.
(c) The foregoing provision shall not prevent the purchase from the Trust
or from the underwriter of shares issued by the Trust by any officer or Trustee
of the Trust or by any partner, officer, director or shareholder of the manager
or investment adviser of the Trust at the price available to the public
generally at the moment of such purchase or, to the extent that any such person
is a shareholder, at the price available to shareholders of the Trust generally
at the moment of such purchase, or as described in the current Prospectus of the
Trust.
SECTION 2. LOANS OF TRUST ASSETS. The Trust shall not lend assets of the Trust
to any officer or Trustee of the Trust, or to any partner, officer, director or
shareholder of, or person financially interested in, the manager or investment
adviser of the Trust, or the underwriter of the Trust, or to the manager or
investment adviser of the Trust or to the underwriter of the Trust.
<PAGE>
14
SECTION 3. MISCELLANEOUS. The Trust shall not permit any officer or Trustee, or
any officer or director of the manager or investment adviser or underwriter of
the Trust, to deal for or on behalf of the Trust with himself as principal or
agent, or with any partnership, association or corporation in which he has a
financial interest; provided that the foregoing provisions shall not prevent (i)
officers and Trustees of the Trust from buying, holding or selling shares in the
Trust, or from being partners, officers or directors of or otherwise financially
interested in the manager or investment adviser or underwriter of the Trust;
(ii) purchases or sales of securities or other property by the Trust from or to
an affiliated person or to the manager or investment adviser or underwriter of
the Trust if such transaction is exempt from the applicable provisions of the
Act; (iii) purchases of investments from the portfolio of the Trust or sales of
investments owned by the Trust through a security dealer who is, or one or more
of whose partners, shareholders, officers or directors is, an officer or Trustee
of the Trust, if such transactions are handled in the capacity of broker only
and commissions charged do not exceed customary brokerage charges for such
services; (iv) employment of legal counsel, registrar, transfer agent, dividend
disbursing agent or custodian who is, or has a partner, shareholder, officer or
director who is, an officer or Trustee of the Trust if only customary fees are
charged for services to the Trust; (v) sharing statistical, research, legal and
management expenses and office hire and expenses with any other investment
company in which an officer or Trustee of the Trust is an officer,trustee or
director or otherwise financially interested; or (vi) the purchase for the
portfolio of the Trust of securities issued by an issuer having an officer,
director or security holder who is an officer, Trustee or director of the Trust
or of the manager or investment adviser of the Trust, unless such purchase would
violate the Trust's investment policies or restrictions.
References to the manager or investment adviser of the Trust contained in
this Article XIV shall also be deemed to refer to any sub-adviser appointed in
accordance with Article VIII, Section 1 of the Declaration of Trust.
ARTICLE XV
Amendments
Except as provided in Section 3 of Article I of these By-Laws for the
portions of such Section 3 referred to therein, these By-Laws may be amended at
any meeting of the Trustees by a vote of a majority of the Trustees then in
office.
**********
Eaton Vance Series Trust
24 Federal Street
Boston, MA 02110
(617) 482-8260
August 30, 1996
Eaton Vance Series Trust hereby adopts and agrees to become a party to the
attached Master Custodian Agreement as amended between the Eaton Vance Group of
Funds and Investors Bank & Trust Company on behalf of the series of the Trust
listed on the attached Schedule A.
EATON VANCE SERIES TRUST
By: /S/ JAMES L. O'CONNOR
--------------------------------
Treasurer
Accepted and agreed to:
INVESTORS BANK & TRUST COMPANY
By: /S/ Michael F. Rogers
- -----------------------------------
Title: Executive Managing Director
<PAGE>
Schedule A
August 30, 1996
EATON VANCE SERIES TRUST
Vance Sanders Exchange Fund
<PAGE>
MASTER CUSTODIAN AGREEMENT
between
EATON VANCE GROUP OF FUNDS
and
INVESTORS BANK & TRUST COMPANY
<PAGE>
TABLE OF CONTENTS
1. Definitions........................................................1-2
2. Employment of Custodian and Property to be held by it..............2-3
3. Duties of the Custodian with Respect to
Property of the Fund.................................................3
A. Safekeeping and Holding of Property..............................3
B. Delivery of Securities.........................................3-6
C. Registration of Securities.......................................6
D. Bank Accounts....................................................6
E. Payments for Shares of the Fund..................................6
F. Investment and Availability of Federal Funds.....................6
G. Collections......................................................7
H. Payment of Fund Moneys.........................................8-9
I. Liability for Payment in Advance of
Receipt of Securities Purchased..................................9
J. Payments for Repurchases of Redemptions
of Shares of the Fund.........................................9-10
K. Appointment of Agents by the Custodian..........................10
L. Deposit of Fund Portfolio Securities in Securities Systems...10-11
M. Deposit of Fund Commercial Paper in an Approved Book-Entry
System for Commercial Paper................................12-13
N. Segregated Account...........................................13-14
O. Ownership Certificates for Tax Purposes.........................14
P. Proxies.........................................................14
Q. Communications Relating to Fund Portfolio Securities............14
R. Exercise of Rights; Tender Offers...........................14-15
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S. Depository Receipts.............................................15
T. Interest Bearing Call or Time Deposits..........................15
U. Options, Futures Contracts and Foreign Currency Transactions.15-17
V. Actions Permitted Without Express Authority.....................17
4. Duties of Bank with Respect to Books of Account and
Calculations of Net Asset Value.....................................17
5. Records and Miscellaneous Duties....................................18
6. Opinion of Fund`s Independent Public Accountants....................18
7. Compensation and Expenses of Bank...................................18
8. Responsibility of Bank...........................................18-19
9. Persons Having Access to Assets of the Fund.........................19
10. Effective Period, Termination and Amendment; Successor Custodian....20
11. Interpretive and Additional Provisions..............................20
12. Notices.............................................................21
13. Massachusetts Law to Apply..........................................21
14. Adoption of the Agreement by the Fund...............................21
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<PAGE>
MASTER CUSTODIAN AGREEMENT
This Agreement is made between each investment company advised by Eaton
Vance Management which has adopted this Agreement in the manner provided herein
and Investors Bank & Trust Company (hereinafter called "Bank", "Custodian" and
"Agent"), a trust company established under the laws of Massachusetts with a
principal place of business in Boston, Massachusetts.
Whereas, each such investment company is registered under the Investment
Company Act of 1940 and has appointed the Bank to act as Custodian of its
property and to perform certain duties as its Agent, as more fully hereinafter
set forth; and
Whereas, the Bank is willing and able to act as each such investment
company's Custodian and Agent, subject to and in accordance with the provisions
hereof;
Now, therefore, in consideration of the premises and of the mutual
covenants and agreements herein contained, each such investment company and the
Bank agree as follows:
1. DEFINITIONS
Whenever used in this Agreement, the following words and phrases, unless
the context otherwise requires, shall have the following meanings:
(a) "Fund" shall mean the investment company which has adopted this
Agreement. If the Fund is a Massachusetts business trust, it may in the future
establish and designate other separate and distinct series of shares, each of
which may be called a "portfolio"; in such case, the term "Fund" shall also
refer to each such separate series or portfolio.
(b) "Board" shall mean the board of directors/trustees/managing general
partners/director general partners of the Fund, as the case may be.
(c) "The Depository Trust Company", a clearing agency registered with the
Securities and Exchange Commission under Section 17A of the Securities Exchange
Act of 1934 which acts as a securities depository and which has been
specifically approved as a securities depository for the Fund by the Board.
(d) "Participants Trust Company", a clearing agency registered with the
Securities and Exchange Commission under Section 17A of the Securities Exchange
Act of 1934 which acts as a securities depository and which has been
specifically approved as a securities depository for the Fund by the Board.
(e) "Approved Clearing Agency" shall mean any other domestic clearing
agency registered with the Securities and Exchange Commission under Section 17A
of the Securities Exchange Act of 1934 which acts as a securities depository BUT
ONLY if the Custodian has received a certified copy of a vote of the Board
approving such clearing agency as a securities depository for the Fund.
(f) "Federal Book-Entry System" shall mean the book-entry system referred
to in Rule 17f-4(b) under the Investment Company Act of 1940 for United States
and federal agency securities (i.e., as provided in Subpart O of Treasury
Circular No. 300, 31 CFR 306, Subpart B of 31 CFR Part 350, and the book-entry
regulations of federal agencies substantially in the form of Subpart O).
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<PAGE>
(g) "Approved Foreign Securities Depository" shall mean a foreign
securities depository or clearing agency referred to in Rule 17f-4 under the
Investment Company Act of 1940 for foreign securities BUT ONLY if the Custodian
has received a certified copy of a vote of the Board approving such depository
or clearing agency as a foreign securities depository for the Fund.
(h) "Approved Book-Entry System for Commercial Paper" shall mean a system
maintained by the Custodian or by a subcustodian employed pursuant to Section 2
hereof for the holding of commercial paper in book-entry form BUT ONLY if the
Custodian has received a certified copy of a vote of the Board approving the
participation by the Fund in such system.
(i) The Custodian shall be deemed to have received "proper instructions" in
respect of any of the matters referred to in this Agreement upon receipt of
written or facsimile instructions signed by such one or more person or persons
as the Board shall have from time to time authorized to give the particular
class of instructions in question. Electronic instructions for the purchase and
sale of securities which are transmitted by Eaton Vance Management to the
Custodian through the Eaton Vance equity trading system and the Eaton Vance
fixed income trading system shall be deemed to be proper instructions; the Fund
shall cause all such instructions to be confirmed in writing. Different persons
may be authorized to give instructions for different purposes. A certified copy
of a vote of the Board may be received and accepted by the Custodian as
conclusive evidence of the authority of any such person to act and may be
considered as in full force and effect until receipt of written notice to the
contrary. Such instructions may be general or specific in terms and, where
appropriate, may be standing instructions. Unless the vote delegating authority
to any person or persons to give a particular class of instructions specifically
requires that the approval of any person, persons or committee shall first have
been obtained before the Custodian may act on instructions of that class, the
Custodian shall be under no obligation to question the right of the person or
persons giving such instructions in so doing. Oral instructions will be
considered proper instructions if the Custodian reasonably believes them to have
been given by a person authorized to give such instructions with respect to the
transaction involved. The Fund shall cause all oral instructions to be confirmed
in writing. The Fund authorizes the Custodian to tape record any and all
telephonic or other oral instructions given to the Custodian. Upon receipt of a
certificate signed by two officers of the Fund as to the authorization by the
President and the Treasurer of the Fund accompanied by a detailed description of
the communication procedures approved by the President and the Treasurer of the
Fund, "proper instructions" may also include communications effected directly
between electromechanical or electronic devices provided that the President and
Treasurer of the Fund and the Custodian are satisfied that such procedures
afford adequate safeguards for the Fund's assets. In performing its duties
generally, and more particularly in connection with the purchase, sale and
exchange of securities made by or for the Fund, the Custodian may take
cognizance of the provisions of the governing documents and registration
statement of the Fund as the same may from time to time be in effect (and votes,
resolutions or proceedings of the shareholders or the Board), but, nevertheless,
except as otherwise expressly provided herein, the Custodian may assume unless
and until notified in writing to the contrary that so-called proper instructions
received by it are not in conflict with or in any way contrary to any provisions
of such governing documents and registration statement, or votes, resolutions or
proceedings of the shareholders or the Board.
2. EMPLOYMENT OF CUSTODIAN AND PROPERTY TO BE HELD BY IT
The Fund hereby appoints and employs the Bank as its Custodian and Agent in
accordance with and subject to the provisions hereof, and the Bank hereby
accepts such appointment and employment. The Fund agrees to deliver to the
Custodian all securities, participation interests, cash and other assets owned
by it, and all payments of income, payments of principal and capital
distributions and adjustments received by it with respect to all securities and
participation interests owned by the Fund from time to time, and the cash
-2-
<PAGE>
consideration received by it for such new or treasury shares ("Shares") of
the Fund as may be issued or sold from time to time. The Custodian shall not be
responsible for any property of the Fund held by the Fund and not delivered by
the Fund to the Custodian. The Fund will also deliver to the Bank from time to
time copies of its currently effective charter (or declaration of trust or
partnership agreement, as the case may be), by-laws, prospectus, statement of
additional information and distribution agreement with its principal
underwriter, together with such resolutions, votes and other proceedings of the
Fund as may be necessary for or convenient to the Bank in the performance of its
duties hereunder.
The Custodian may from time to time employ one or more subcustodians to
perform such acts and services upon such terms and conditions as shall be
approved from time to time by the Board of Directors. Any such subcustodian so
employed by the Custodian shall be deemed to be the agent of the Custodian, and
the Custodian shall remain primarily responsible for the securities,
participation interests, moneys and other property of the Fund held by such
subcustodian. Any foreign subcustodian shall be a bank or trust company which is
an eligible foreign custodian within the meaning of Rule 17f-5 under the
Investment Company Act of 1940, and the foreign custody arrangements shall be
approved by the Board of Directors and shall be in accordance with and subject
to the provisions of said Rule. For the purposes of this Agreement, any property
of the Fund held by any such subcustodian (domestic or foreign) shall be deemed
to be held by the Custodian under the terms of this Agreement.
3. DUTIES OF THE CUSTODIAN WITH RESPECT TO PROPERTY OF THE FUND
A. SAFEKEEPING AND HOLDING OF PROPERTY The Custodian shall keep safely all
property of the Fund and on behalf of the Fund shall from time to time receive
delivery of Fund property for safekeeping. The Custodian shall hold, earmark and
segregate on its books and records for the account of the Fund all property of
the Fund, including all securities, participation interests and other assets of
the Fund (1) physically held by the Custodian, (2) held by any subcustodian
referred to in Section 2 hereof or by any agent referred to in Paragraph K
hereof, (3) held by or maintained in The Depository Trust Company or in
Participants Trust Company or in an Approved Clearing Agency or in the Federal
Book-Entry System or in an Approved Foreign Securities Depository, each of which
from time to time is referred to herein as a "Securities System", and (4) held
by the Custodian or by any subcustodian referred to in Section 2 hereof and
maintained in any Approved Book-Entry System for Commercial Paper.
B. DELIVERY OF SECURITIES The Custodian shall release and deliver
securities or participation interests owned by the Fund held (or deemed to be
held) by the Custodian or maintained in a Securities System account or in an
Approved Book-Entry System for Commercial Paper account only upon receipt of
proper instructions, which may be continuing instructions when deemed
appropriate by the parties, and only in the following cases:
1) Upon sale of such securities or participation interests for the account
of the Fund, BUT ONLY against receipt of payment therefor; if delivery is made
in Boston or New York City, payment therefor shall be made in accordance with
generally accepted clearing house procedures or by use of Federal Reserve Wire
System procedures; if delivery is made elsewhere payment therefor shall be in
accordance with the then current "street delivery" custom or in accordance with
such procedures agreed to in writing from time to time by the parties hereto; if
the sale is effected through a Securities System, delivery and payment therefor
shall be made in accordance with the provisions of Paragraph L hereof; if the
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<PAGE>
sale of commercial paper is to be effected through an Approved Book-Entry
System for Commercial Paper, delivery and payment therefor shall be made in
accordance with the provisions of Paragraph M hereof; if the securities are to
be sold outside the United States, delivery may be made in accordance with
procedures agreed to in writing from time to time by the parties hereto; for the
purposes of this subparagraph, the term "sale" shall include the disposition of
a portfolio security (i) upon the exercise of an option written by the Fund and
(ii) upon the failure by the Fund to make a successful bid with respect to a
portfolio security, the continued holding of which is contingent upon the making
of such a bid;
2) Upon the receipt of payment in connection with any repurchase agreement
or reverse repurchase agreement relating to such securities and entered into by
the Fund;
3) To the depository agent in connection with tender or other similar
offers for portfolio securities of the Fund;
4) To the issuer thereof or its agent when such securities or participation
interests are called, redeemed, retired or otherwise become payable; PROVIDED
that, in any such case, the cash or other consideration is to be delivered to
the Custodian or any subcustodian employed pursuant to Section 2 hereof;
5) To the issuer thereof, or its agent, for transfer into the name of the
Fund or into the name of any nominee of the Custodian or into the name or
nominee name of any agent appointed pursuant to Paragraph K hereof or into the
name or nominee name of any subcustodian employed pursuant to Section 2 hereof;
or for exchange for a different number of bonds, certificates or other evidence
representing the same aggregate face amount or number of units; PROVIDED that,
in any such case, the new securities or participation interests are to be
delivered to the Custodian or any subcustodian employed pursuant to Section 2
hereof;
6) To the broker selling the same for examination in accordance with the
"street delivery" custom; PROVIDED that the Custodian shall adopt such
procedures as the Fund from time to time shall approve to ensure their prompt
return to the Custodian by the broker in the event the broker elects not to
accept them;
7) For exchange or conversion pursuant to any plan of merger,
consolidation, recapitalization, reorganization or readjustment of the
securities of the Issuer of such securities, or pursuant to provisions for
conversion of such securities, or pursuant to any deposit agreement; PROVIDED
that, in any such case, the new securities and cash, if any, are to be delivered
to the Custodian or any subcustodian employed pursuant to Section 2 hereof;
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<PAGE>
8) In the case of warrants, rights or similar securities, the surrender
thereof in connection with the exercise of such warrants, rights or similar
securities, or the surrender of interim receipts or temporary securities for
definitive securities; PROVIDED that, in any such case, the new securities and
cash, if any, are to be delivered to the Custodian or any subcustodian employed
pursuant to Section 2 hereof;
9) For delivery in connection with any loans of securities made by the Fund
(such loans to be made pursuant to the terms of the Fund's current registration
statement), BUT ONLY against receipt of adequate collateral as agreed upon from
time to time by the Custodian and the Fund, which may be in the form of cash or
obligations issued by the United States government, its agencies or
instrumentalities; except that in connection with any securities loans for which
collateral is to be credited to the Custodian's account in the book-entry system
authorized by the U.S. Department of Treasury, the Custodian will not be held
liable or responsible for the delivery of securities loaned by the Fund prior to
the receipt of such collateral;
10) For delivery as security in connection with any borrowings by the Fund
requiring a pledge or hypothecation of assets by the Fund (if then permitted
under circumstances described in the current registration statement of the
Fund), provided, that the securities shall be released only upon payment to the
Custodian of the monies borrowed, except that in cases where additional
collateral is required to secure a borrowing already made, further securities
may be released for that purpose; upon receipt of proper instructions, the
Custodian may pay any such loan upon redelivery to it of the securities pledged
or hypothecated therefor and upon surrender of the note or notes evidencing the
loan;
11) When required for delivery in connection with any redemption or
repurchase of Shares of the Fund in accordance with the provisions of Paragraph
J hereof;
12) For delivery in accordance with the provisions of any agreement between
the Custodian (or a subcustodian employed pursuant to Section 2 hereof) and a
broker-dealer registered under the Securities Exchange Act of 1934 and, if
necessary, the Fund, relating to compliance with the rules of The Options
Clearing Corporation or of any registered national securities exchange, or of
any similar organization or organizations, regarding deposit or escrow or other
arrangements in connection with options transactions by the Fund;
13) For delivery in accordance with the provisions of any agreement among
the Fund, the Custodian (or a subcustodian employed pursuant to Section 2
hereof), and a futures commissions merchant, relating to compliance with the
rules of the Commodity Futures Trading Commission and/or of any contract market
or commodities exchange or similar organization, regarding futures margin
account deposits or payments in connection with futures transactions by the
Fund;
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<PAGE>
14) For any other proper corporate purpose, BUT ONLY upon receipt of, in
addition to proper instructions, a certified copy of a vote of the Board
specifying the securities to be delivered, setting forth the purpose for which
such delivery is to be made, declaring such purpose to be proper corporate
purpose, and naming the person or persons to whom delivery of such securities
shall be made.
C. REGISTRATION OF SECURITIES Securities held by the Custodian (other than
bearer securities) for the account of the Fund shall be registered in the name
of the Fund or in the name of any nominee of the Fund or of any nominee of the
Custodian, or in the name or nominee name of any agent appointed pursuant to
Paragraph K hereof, or in the name or nominee name of any subcustodian employed
pursuant to Section 2 hereof, or in the name or nominee name of The Depository
Trust Company or Participants Trust Company or Approved Clearing Agency or
Federal Book-Entry System or Approved Book-Entry System for Commercial Paper;
provided, that securities are held in an account of the Custodian or of such
agent or of such subcustodian containing only assets of the Fund or only assets
held by the Custodian or such agent or such subcustodian as a custodian or
subcustodian or in a fiduciary capacity for customers. All certificates for
securities accepted by the Custodian or any such agent or subcustodian on behalf
of the Fund shall be in "street" or other good delivery form or shall be
returned to the selling broker or dealer who shall be advised of the reason
thereof.
D. BANK ACCOUNTS The Custodian shall open and maintain a separate bank
account or accounts in the name of the Fund, subject only to draft or order by
the Custodian acting in pursuant to the terms of this Agreement, and shall hold
in such account or accounts, subject to the provisions hereof, all cash received
by it from or for the account of the Fund other than cash maintained by the Fund
in a bank account established and used in accordance with Rule 17f-3 under the
Investment Company Act of 1940. Funds held by the Custodian for the Fund may be
deposited by it to its credit as Custodian in the Banking Department of the
Custodian or in such other banks or trust companies as the Custodian may in its
discretion deem necessary or desirable; PROVIDED, however, that every such bank
or trust company shall be qualified to act as a custodian under the Investment
Company Act of 1940 and that each such bank or trust company and the funds to be
deposited with each such bank or trust company shall be approved in writing by
two officers of the Fund. Such funds shall be deposited by the Custodian in its
capacity as Custodian and shall be subject to withdrawal only by the Custodian
in that capacity.
E. PAYMENT FOR SHARES OF THE FUND The Custodian shall make appropriate
arrangements with the Transfer Agent and the principal underwriter of the Fund
to enable the Custodian to make certain it promptly receives the cash or other
consideration due to the Fund for such new or treasury Shares as may be issued
or sold from time to time by the Fund, in accordance with the governing
documents and offering prospectus and statement of additional information of the
Fund. The Custodian will provide prompt notification to the Fund of any receipt
by it of payments for Shares of the Fund.
F. INVESTMENT AND AVAILABILITY OF FEDERAL FUNDS Upon agreement between the
Fund and the Custodian, the Custodian shall, upon the receipt of proper
instructions, which may be continuing instructions when deemed appropriate by
the parties,
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<PAGE>
1) invest in such securities and instruments as may be set forth in such
instructions on the same day as received all federal funds received after a time
agreed upon between the Custodian and the Fund; and
2) make federal funds available to the Fund as of specified times agreed
upon from time to time by the Fund and the Custodian in the amount of checks
received in payment for Shares of the Fund which are deposited into the Fund's
account.
G. COLLECTIONS The Custodian shall promptly collect all income and other
payments with respect to registered securities held hereunder to which the Fund
shall be entitled either by law or pursuant to custom in the securities
business, and shall promptly collect all income and other payments with respect
to bearer securities if, on the date of payment by the issuer, such securities
are held by the Custodian or agent thereof and shall credit such income, as
collected, to the Fund's custodian account.
The Custodian shall do all things necessary and proper in connection with
such prompt collections and, without limiting the generality of the foregoing,
the Custodian shall
1) Present for payment all coupons and other income items requiring
presentations;
2) Present for payment all securities which may mature or be called,
redeemed, retired or otherwise become payable;
3) Endorse and deposit for collection, in the name of the Fund, checks,
drafts or other negotiable instruments;
4) Credit income from securities maintained in a Securities System or in an
Approved Book-Entry System for Commercial Paper at the time funds become
available to the Custodian; in the case of securities maintained in The
Depository Trust Company funds shall be deemed available to the Fund not later
than the opening of business on the first business day after receipt of such
funds by the Custodian.
The Custodian shall notify the Fund as soon as reasonably practicable
whenever income due on any security is not promptly collected. In any case in
which the Custodian does not receive any due and unpaid income after it has made
demand for the same, it shall immediately so notify the Fund in writing,
enclosing copies of any demand letter, any written response thereto, and
memoranda of all oral responses thereto and to telephonic demands, and await
instructions from the Fund; the Custodian shall in no case have any liability
for any nonpayment of such income provided the Custodian meets the standard of
care set forth in Section 8 hereof. The Custodian shall not be obligated to take
legal action for collection unless and until reasonably indemnified to its
satisfaction.
The Custodian shall also receive and collect all stock dividends, rights
and other items of like nature, and deal with the same pursuant to proper
instructions relative thereto.
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H. PAYMENT OF FUND MONEYS Upon receipt of proper instructions, which may be
continuing instructions when deemed appropriate by the parties, the Custodian
shall pay out moneys of the Fund in the following cases only:
1) Upon the purchase of securities, participation interests, options,
futures contracts, forward contracts and options on futures contracts purchased
for the account of the Fund but only (a) against the receipt of
(i) such securities registered as provided in Paragraph C hereof or in
proper form for transfer or
(ii) detailed instructions signed by an officer of the Fund regarding the
participation interests to be purchased or
(iii) written confirmation of the purchase by the Fund of the options,
futures contracts, forward contracts or options on futures contracts
by the Custodian (or by a subcustodian employed pursuant to Section 2
hereof or by a clearing corporation of a national securities exchange of which
the Custodian is a member or by any bank, banking institution or trust company
doing business in the United States or abroad which is qualified under the
Investment Company Act of 1940 to act as a custodian and which has been
designated by the Custodian as its agent for this purpose or by the agent
specifically designated in such instructions as representing the purchasers of a
new issue of privately placed securities); (b) in the case of a purchase
effected through a Securities System, upon receipt of the securities by the
Securities System in accordance with the conditions set forth in Paragraph L
hereof; (c) in the case of a purchase of commercial paper effected through an
Approved Book-Entry System for Commercial Paper, upon receipt of the paper by
the Custodian or subcustodian in accordance with the conditions set forth in
Paragraph M hereof; (d) in the case of repurchase agreements entered into
between the Fund and another bank or a broker-dealer, against receipt by the
Custodian of the securities underlying the repurchase agreement either in
certificate form or through an entry crediting the Custodian's segregated,
non-proprietary account at the Federal Reserve Bank of Boston with such
securities along with written evidence of the agreement by the bank or
broker-dealer to repurchase such securities from the Fund; or (e) with respect
to securities purchased outside of the United States, in accordance with written
procedures agreed to from time to time in writing by the parties hereto;
2) When required in connection with the conversion, exchange or surrender
of securities owned by the Fund as set forth in Paragraph B hereof;
3) When required for the redemption or repurchase of Shares of the Fund in
accordance with the provisions of Paragraph J hereof;
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4) For the payment of any expense or liability incurred by the Fund,
including but not limited to the following payments for the account of the Fund:
advisory fees, distribution plan payments, interest, taxes, management
compensation and expenses, accounting, transfer agent and legal fees, and other
operating expenses of the Fund whether or not such expenses are to be in whole
or part capitalized or treated as deferred expenses;
5) For the payment of any dividends or other distributions to holders of
Shares declared or authorized by the Board; and
6) For any other proper corporate purpose, BUT ONLY upon receipt of, in
addition to proper instructions, a certified copy of a vote of the Board,
specifying the amount of such payment, setting forth the purpose for which such
payment is to be made, declaring such purpose to be a proper corporate purpose,
and naming the person or persons to whom such payment is to be made.
I. LIABILITY FOR PAYMENT IN ADVANCE OF RECEIPT OF SECURITIES PURCHASED In
any and every case where payment for purchase of securities for the account of
the Fund is made by the Custodian in advance of receipt of the securities
purchased in the absence of specific written instructions signed by two officers
of the Fund to so pay in advance, the Custodian shall be absolutely liable to
the Fund for such securities to the same extent as if the securities had been
received by the Custodian; EXCEPT that in the case of a repurchase agreement
entered into by the Fund with a bank which is a member of the Federal Reserve
System, the Custodian may transfer funds to the account of such bank prior to
the receipt of (i) the securities in certificate form subject to such repurchase
agreement or (ii) written evidence that the securities subject to such
repurchase agreement have been transferred by book-entry into a segregated
non-proprietary account of the Custodian maintained with the Federal Reserve
Bank of Boston or (iii) the safekeeping receipt, PROVIDED that such securities
have in fact been so transfered by book-entry and the written repurchase
agreement is received by the Custodian in due course; AND EXCEPT that if the
securities are to be purchased outside the United States, payment may be made in
accordance with procedures agreed to in writing from time to time by the parties
hereto.
J. PAYMENTS FOR REPURCHASES OR REDEMPTIONS OF SHARES OF THE FUND From such
funds as may be available for the purpose, but subject to any applicable votes
of the Board and the current redemption and repurchase procedures of the Fund,
the Custodian shall, upon receipt of written instructions from the Fund or from
the Fund's transfer agent or from the principal underwriter, make funds and/or
portfolio securities available for payment to holders of Shares who have caused
their Shares to be redeemed or repurchased by the Fund or for the Fund`s account
by its transfer agent or principal underwriter.
The Custodian may maintain a special checking account upon which special
checks may be drawn by shareholders of the Fund holding Shares for which
certificates have not been issued. Such checking account and such special checks
shall be subject to such rules and regulations as the Custodian and the Fund may
from time to time adopt. The Custodian or the Fund may suspend or terminate use
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of such checking account or such special checks (either generally or for one
or more shareholders) at any time. The Custodian and the Fund shall notify
the other immediately of any such suspension or termination.
K. APPOINTMENT OF AGENTS BY THE CUSTODIAN The Custodian may at any time or
times in its discretion appoint (and may at any time remove) any other bank or
trust company (PROVIDED such bank or trust company is itself qualified under the
Investment Company Act of 1940 to act as a custodian or is itself an eligible
foreign custodian within the meaning of Rule 17f-5 under said Act) as the agent
of the Custodian to carry out such of the duties and functions of the Custodian
described in this Section 3 as the Custodian may from time to time direct;
PROVIDED, however, that the appointment of any such agent shall not relieve the
Custodian of any of its responsibilities or liabilities hereunder, and as
between the Fund and the Custodian the Custodian shall be fully responsible for
the acts and omissions of any such agent. For the purposes of this Agreement,
any property of the Fund held by any such agent shall be deemed to be held by
the Custodian hereunder.
L. DEPOSIT OF FUND PORTFOLIO SECURITIES IN SECURITIES SYSTEMS The
Custodian may deposit and/or maintain securities owned by the Fund
(1) in The Depository Trust Company;
(2) in Participants Trust Company;
(3) in any other Approved Clearing Agency;
(4) in the Federal Book-Entry System; or
(5) in an Approved Foreign Securities Depository
in each case only in accordance with applicable Federal Reserve Board and
Securities and Exchange Commission rules and regulations, and at all times
subject to the following provisions:
(a) The Custodian may (either directly or through one or more subcustodians
employed pursuant to Section 2 keep securities of the Fund in a Securities
System provided that such securities are maintained in a non-proprietary account
("Account") of the Custodian or such subcustodian in the Securities System which
shall not include any assets of the Custodian or such subcustodian or any other
person other than assets held by the Custodian or such subcustodian as a
fiduciary, custodian, or otherwise for its customers.
(b) The records of the Custodian with respect to securities of the Fund
which are maintained in a Securities System shall identify by book-entry those
securities belonging to the Fund, and the Custodian shall be fully and
completely responsible for maintaining a recordkeeping system capable of
accurately and currently stating the Fund's holdings maintained in each such
Securities System.
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(c) The Custodian shall pay for securities purchased in book-entry form for
the account of the Fund only upon (i) receipt of notice or advice from the
Securities System that such securities have been transferred to the Account, and
(ii) the making of any entry on the records of the Custodian to reflect such
payment and transfer for the account of the Fund. The Custodian shall transfer
securities sold for the account of the Fund only upon (i) receipt of notice or
advice from the Securities System that payment for such securities has been
transferred to the Account, and (ii) the making of an entry on the records of
the Custodian to reflect such transfer and payment for the account of the Fund.
Copies of all notices or advices from the Securities System of transfers of
securities for the account of the Fund shall identify the Fund, be maintained
for the Fund by the Custodian and be promptly provided to the Fund at its
request. The Custodian shall promptly send to the Fund confirmation of each
transfer to or from the account of the Fund in the form of a written advice or
notice of each such transaction, and shall furnish to the Fund copies of daily
transaction sheets reflecting each day's transactions in the Securities System
for the account of the Fund on the next business day.
(d) The Custodian shall promptly send to the Fund any report or other
communication received or obtained by the Custodian relating to the Securities
System's accounting system, system of internal accounting controls or procedures
for safeguarding securities deposited in the Securities System; the Custodian
shall promptly send to the Fund any report or other communication relating to
the Custodian's internal accounting controls and procedures for safeguarding
securities deposited in any Securities System; and the Custodian shall ensure
that any agent appointed pursuant to Paragraph K hereof or any subcustodian
employed pursuant to Section 2 hereof shall promptly send to the Fund and to the
Custodian any report or other communication relating to such agent's or
subcustodian's internal accounting controls and procedures for safeguarding
securities deposited in any Securities System. The Custodian's books and records
relating to the Fund's participation in each Securities System will at all times
during regular business hours be open to the inspection of the Fund's authorized
officers, employees or agents.
(e) The Custodian shall not act under this Paragraph L in the absence of
receipt of a certificate of an officer of the Fund that the Board has approved
the use of a particular Securities System; the Custodian shall also obtain
appropriate assurance from the officers of the Fund that the Board has annually
reviewed the continued use by the Fund of each Securities System, and the Fund
shall promptly notify the Custodian if the use of a Securities System is to be
discontinued; at the request of the Fund, the Custodian will terminate the use
of any such Securities System as promptly as practicable.
(f) Anything to the contrary in this Agreement notwithstanding, the
Custodian shall be liable to the Fund for any loss or damage to the Fund
resulting from use of the Securities System by reason of any negligence,
misfeasance or misconduct of the Custodian or any of its agents or subcustodians
or of any of its or their employees or from any failure of the Custodian or any
such agent or subcustodian to enforce effectively such rights as it may have
against the Securities System or any other person; at the election of the Fund,
it shall be entitled to be subrogated to the rights of the Custodian with
respect to any claim against the Securities System or any other person which the
Custodian may have as a consequence of any such loss or damage if and to the
extent that the Fund has not been made whole for any such loss or damage.
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M. DEPOSIT OF FUND COMMERCIAL PAPER IN AN APPROVED BOOK-ENTRY SYSTEM FOR
COMMERCIAL PAPER Upon receipt of proper instructions with respect to each issue
of direct issue commercial paper purchased by the Fund, the Custodian may
deposit and/or maintain direct issue commercial paper owned by the Fund in any
Approved Book-Entry System for Commercial Paper, in each case only in accordance
with applicable Securities and Exchange Commission rules, regulations, and
no-action correspondence, and at all times subject to the following provisions:
(a) The Custodian may (either directly or through one or more subcustodians
employed pursuant to Section 2) keep commercial paper of the Fund in an Approved
Book-Entry System for Commercial Paper, provided that such paper is issued in
book entry form by the Custodian or subcustodian on behalf of an issuer with
which the Custodian or subcustodian has entered into a book-entry agreement and
provided further that such paper is maintained in a non-proprietary account
("Account") of the Custodian or such subcustodian in an Approved Book-Entry
System for Commercial Paper which shall not include any assets of the Custodian
or such subcustodian or any other person other than assets held by the Custodian
or such subcustodian as a fiduciary, custodian, or otherwise for its customers.
(b) The records of the Custodian with respect to commercial paper of the
Fund which is maintained in an Approved Book-Entry System for Commercial Paper
shall identify by book-entry each specific issue of commercial paper purchased
by the Fund which is included in the System and shall at all times during
regular business hours be open for inspection by authorized officers, employees
or agents of the Fund. The Custodian shall be fully and completely responsible
for maintaining a recordkeeping system capable of accurately and currently
stating the Fund's holdings of commercial paper maintained in each such System.
(c) The Custodian shall pay for commercial paper purchased in book-entry
form for the account of the Fund only upon contemporaneous (i) receipt of notice
or advice from the issuer that such paper has been issued, sold and transferred
to the Account, and (ii) the making of an entry on the records of the Custodian
to reflect such purchase, payment and transfer for the account of the Fund. The
Custodian shall transfer such commercial paper which is sold or cancel such
commercial paper which is redeemed for the account of the Fund only upon
contemporaneous (i) receipt of notice or advice that payment for such paper has
been transferred to the Account, and (ii) the making of an entry on the records
of the Custodian to reflect such transfer or redemption and payment for the
account of the Fund. Copies of all notices, advices and confirmations of
transfers of commercial paper for the account of the Fund shall identify the
Fund, be maintained for the Fund by the Custodian and be promptly provided to
the Fund at its request. The Custodian shall promptly send to the Fund
confirmation of each transfer to or from the account of the Fund in the form of
a written advice or notice of each such transaction, and shall furnish to the
Fund copies of daily transaction sheets reflecting each day's transactions in
the System for the account of the Fund on the next business day.
(d) The Custodian shall promptly send to the Fund any report or other
communication received or obtained by the Custodian relating to each System's
accounting system, system of internal accounting controls or procedures for
safeguarding commercial paper deposited in the System; the Custodian shall
promptly send to the Fund any report or other communication relating to the
Custodian's internal accounting controls and procedures for safeguarding
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<PAGE>
commercial paper deposited in any Approved Book-Entry System for Commercial
Paper; and the Custodian shall ensure that any agent appointed pursuant to
Paragraph K hereof or any subcustodian employed pursuant to Section 2 hereof
shall promptly send to the Fund and to the Custodian any report or other
communication relating to such agent's or subcustodian's internal accounting
controls and procedures for safeguarding securities deposited in any Approved
Book-Entry System for Commercial Paper.
(e) The Custodian shall not act under this Paragraph M in the absence of
receipt of a certificate of an officer of the Fund that the Board has approved
the use of a particular Approved Book-Entry System for Commercial Paper; the
Custodian shall also obtain appropriate assurance from the officers of the Fund
that the Board has annually reviewed the continued use by the Fund of each
Approved Book-Entry System for Commercial Paper, and the Fund shall promptly
notify the Custodian if the use of an Approved Book-Entry System for Commercial
Paper is to be discontinued; at the request of the Fund, the Custodian will
terminate the use of any such System as promptly as practicable.
(f) The Custodian (or subcustodian, if the Approved Book-Entry System for
Commercial Paper is maintained by the subcustodian) shall issue physical
commercial paper or promissory notes whenever requested to do so by the Fund or
in the event of an electronic system failure which impedes issuance, transfer or
custody of direct issue commercial paper by book-entry.
(g) Anything to the contrary in this Agreement notwithstanding, the
Custodian shall be liable to the Fund for any loss or damage to the Fund
resulting from use of any Approved Book-Entry System for Commercial Paper by
reason of any negligence, misfeasance or misconduct of the Custodian or any of
its agents or subcustodians or of any of its or their employees or from any
failure of the Custodian or any such agent or subcustodian to enforce
effectively such rights as it may have against the System, the issuer of the
commercial paper or any other person; at the election of the Fund, it shall be
entitled to be subrogated to the rights of the Custodian with respect to any
claim against the System, the issuer of the commercial paper or any other person
which the Custodian may have as a consequence of any such loss or damage if and
to the extent that the Fund has not been made whole for any such loss or damage.
N. SEGREGATED ACCOUNT The Custodian shall upon receipt of proper
instructions establish and maintain a segregated account or accounts for and on
behalf of the Fund, into which account or accounts may be transferred cash
and/or securities, including securities maintained in an account by the
Custodian pursuant to Paragraph L hereof, (i) in accordance with the provisions
of any agreement among the Fund, the Custodian and any registered broker-dealer
(or any futures commission merchant), relating to compliance with the rules of
the Options Clearing Corporation and of any registered national securities
exchange (or of the Commodity Futures Trading Commission or of any contract
market or commodities exchange), or of any similar organization or
organizations, regarding escrow or deposit or other arrangements in connection
with transactions by the Fund, (ii) for purposes of segregating cash or U.S.
Government securities in connection with options purchased, sold or written by
the Fund or futures contracts or options thereon purchased or sold by the Fund,
(iii) for the purposes of compliance by the Fund with the procedures required by
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Investment Company Act Release No. 10666, or any subsequent release or
releases of the Securities and Exchange Commission relating to the maintenance
of segregated accounts by registered investment companies and (iv) for other
proper purposes, BUT ONLY, in the case of clause (iv), upon receipt of, in
addition to proper instructions, a certificate signed by two officers of the
Fund, setting forth the purpose such segregated account and declaring such
purpose to be a proper purpose.
O. OWNERSHIP CERTIFICATES FOR TAX PURPOSES The Custodian shall execute
ownership and other certificates and affidavits for all federal and state tax
purposes in connection with receipt of income or other payments with respect to
securities of the Fund held by it and in connection with transfers of
securities.
P. PROXIES The Custodian shall, with respect to the securities held by it
hereunder, cause to be promptly delivered to the Fund all forms of proxies and
all notices of meetings and any other notices or announcements or other written
information affecting or relating to the securities, and upon receipt of proper
instructions shall execute and deliver or cause its nominee to execute and
deliver such proxies or other authorizations as may be required. Neither the
Custodian nor its nominee shall vote upon any of the securities or execute any
proxy to vote thereon or give any consent or take any other action with respect
thereto (except as otherwise herein provided) unless ordered to do so by proper
instructions.
Q. COMMUNICATIONS RELATING TO FUND PORTFOLIO SECURITIES The Custodian shall
deliver promptly to the Fund all written information (including, without
limitation, pendency of call and maturities of securities and participation
interests and expirations of rights in connection therewith and notices of
exercise of call and put options written by the Fund and the maturity of futures
contracts purchased or sold by the Fund) received by the Custodian from issuers
and other persons relating to the securities and participation interests being
held for the Fund. With respect to tender or exchange offers, the Custodian
shall deliver promptly to the Fund all written information received by the
Custodian from issuers and other persons relating to the securities and
participation interests whose tender or exchange is sought and from the party
(or his agents) making the tender or exchange offer.
R. EXERCISE OF RIGHTS; TENDER OFFERS In the case of tender offers, similar
offers to purchase or exercise rights (including, without limitation, pendency
of calls and maturities of securities and participation interests and
expirations of rights in connection therewith and notices of exercise of call
and put options and the maturity of futures contracts) affecting or relating to
securities and participation interests held by the Custodian under this
Agreement, the Custodian shall have responsibility for promptly notifying the
Fund of all such offers in accordance with the standard of reasonable care set
forth in Section 8 hereof. For all such offers for which the Custodian is
responsible as provided in this Paragraph R, the Fund shall have responsibility
for providing the Custodian with all necessary instructions in timely fashion.
Upon receipt of proper instructions, the Custodian shall timely deliver to the
issuer or trustee thereof, or to the agent of either, warrants, puts, calls,
rights or similar securities for the purpose of being exercised or sold upon
proper receipt therefor and upon receipt of assurances satisfactory to the
Custodian that the new securities and cash, if any, acquired by such action are
to be delivered to the Custodian or any subcustodian employed pursuant to
Section 2 hereof. Upon receipt of proper instructions, the Custodian shall
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timely deposit securities upon invitations for tenders of securities upon
proper receipt therefor and upon receipt of assurances satisfactory to the
Custodian that the consideration to be paid or delivered or the tendered
securities are to be returned to the Custodian or subcustodian employed pursuant
to Section 2 hereof. Notwithstanding any provision of this Agreement to the
contrary, the Custodian shall take all necessary action, unless otherwise
directed to the contrary by proper instructions, to comply with the terms of all
mandatory or compulsory exchanges, calls, tenders, redemptions, or similar
rights of security ownership, and shall thereafter promptly notify the Fund in
writing of such action.
S. DEPOSITORY RECEIPTS The Custodian shall, upon receipt of proper
instructions, surrender or cause to be surrendered foreign securities to the
depository used by an issuer of American Depository Receipts or International
Depository Receipts (hereinafter collectively referred to as "ADRs") for such
securities, against a written receipt therefor adequately describing such
securities and written evidence satisfactory to the Custodian that the
depository has acknowledged receipt of instructions to issue with respect to
such securities ADRs in the name of a nominee of the Custodian or in the name or
nominee name of any subcustodian employed pursuant to Section 2 hereof, for
delivery to the Custodian or such subcustodian at such place as the Custodian or
such subcustodian may from time to time designate. The Custodian shall, upon
receipt of proper instructions, surrender ADRs to the issuer thereof against a
written receipt therefor adequately describing the ADRs surrendered and written
evidence satisfactory to the Custodian that the issuer of the ADRs has
acknowledged receipt of instructions to cause its depository to deliver the
securities underlying such ADRs to the Custodian or to a subcustodian employed
pursuant to Section 2 hereof.
T. INTEREST BEARING CALL OR TIME DEPOSITS The Custodian shall, upon receipt
of proper instructions, place interest bearing fixed term and call deposits with
the banking department of such banking institution (other than the Custodian)
and in such amounts as the Fund may designate. Deposits may be denominated in
U.S. Dollars or other currencies. The Custodian shall include in its records
with respect to the assets of the Fund appropriate notation as to the amount and
currency of each such deposit, the accepting banking institution and other
appropriate details and shall retain such forms of advice or receipt evidencing
the deposit, if any, as may be forwarded to the Custodian by the banking
institution. Such deposits shall be deemed portfolio securities of the
applicable Fund for the purposes of this Agreement, and the Custodian shall be
responsible for the collection of income from such accounts and the transmission
of cash to and from such accounts.
U. OPTIONS, FUTURES CONTRACTS AND FOREIGN CURRENCY TRANSACTIONS
1. OPTIONS. The Custodians shall, upon receipt of proper instructions and
in accordance with the provisions of any agreement between the Custodian, any
registered broker-dealer and, if necessary, the Fund, relating to compliance
with the rules of the Options Clearing Corporation or of any registered national
securities exchange or similar organization or organizations, receive and retain
confirmations or other documents, if any, evidencing the purchase or writing of
an option on a security or securities index or other financial instrument or
index by the Fund; deposit and maintain in a segregated account for each Fund
separately, either physically or by book-entry in a Securities System,
securities subject to a covered call option written by the Fund; and release
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and/or transfer such securities or other assets only in accordance with a
notice or other communication evidencing the expiration, termination or exercise
of such covered option furnished by the Options Clearing Corporation, the
securities or options exchange on which such covered option is traded or such
other organization as may be responsible for handling such options transactions.
The Custodian and the broker-dealer shall be responsible for the sufficiency of
assets held in each Fund's segregated account in compliance with applicable
margin maintenance requirements.
2. FUTURES CONTRACTS The Custodian shall, upon receipt of proper
instructions, receive and retain confirmations and other documents, if any,
evidencing the purchase or sale of a futures contract or an option on a futures
contract by the Fund; deposit and maintain in a segregated account, for the
benefit of any futures commission merchant, assets designated by the Fund as
initial, maintenance or variation "margin" deposits (including mark-to-market
payments) intended to secure the Fund's performance of its obligations under any
futures contracts purchased or sold or any options on futures contracts written
by Fund, in accordance with the provisions of any agreement or agreements among
the Fund, the Custodian and such futures commission merchant, designed to comply
with the rules of the Commodity Futures Trading Commission and/or of any
contract market or commodities exchange or similar organization regarding such
margin deposits or payments; and release and/or transfer assets in such margin
accounts only in accordance with any such agreements or rules. The Custodian and
the futures commission merchant shall be responsible for the sufficiency of
assets held in the segregated account in compliance with the applicable margin
maintenance and mark-to-market payment requirements.
3. FOREIGN EXCHANGE TRANSACTIONS The Custodian shall, pursuant to proper
instructions, enter into or cause a subcustodian to enter into foreign exchange
contracts or options to purchase and sell foreign currencies for spot and future
delivery on behalf and for the account of the Fund. Such transactions may be
undertaken by the Custodian or subcustodian with such banking or financial
institutions or other currency brokers, as set forth in proper instructions.
Foreign exchange contracts and options shall be deemed to be portfolio
securities of the Fund; and accordingly, the responsibility of the Custodian
therefor shall be the same as and no greater than the Custodian's responsibility
in respect of other portfolio securities of the Fund. The Custodian shall be
responsible for the transmittal to and receipt of cash from the currency broker
or banking or financial institution with which the contract or option is made,
the maintenance of proper records with respect to the transaction and the
maintenance of any segregated account required in connection with the
transaction. The Custodian shall have no duty with respect to the selection of
the currency brokers or banking or financial institutions with which the Fund
deals or for their failure to comply with the terms of any contract or option.
Without limiting the foregoing, it is agreed that upon receipt of proper
instructions and insofar as funds are made available to the Custodian for the
purpose, the Custodian may (if determined necessary by the Custodian to
consummate a particular transaction on behalf and for the account of the Fund)
make free outgoing payments of cash in the form of U.S. dollars or foreign
currency before receiving confirmation of a foreign exchange contract or
confirmation that the countervalue currency completing the foreign exchange
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contact has been delivered or received. The Custodian shall not be
responsible for any costs and interest charges which may be incurred by the Fund
or the Custodian as a result of the failure or delay of third parties to deliver
foreign exchange; provided that the Custodian shall nevertheless be held to the
standard of care set forth in, and shall be liable to the Fund in accordance
with, the provisions of Section 8.
V. ACTIONS PERMITTED WITHOUT EXPRESS AUTHORITY The Custodian may in its
discretion, without express authority from the Fund:
1) make payments to itself or others for minor expenses of handling
securities or other similar items relating to its duties under this Agreement,
PROVIDED, that all such payments shall be accounted for by the Custodian to the
Treasurer of the Fund;
2) surrender securities in temporary form for securities in definitive
form;
3) endorse for collection, in the name of the Fund, checks, drafts and
other negotiable instruments; and
4) in general, attend to all nondiscretionary details in connection with
the sale, exchange, substitution, purchase, transfer and other dealings with the
securities and property of the Fund except as otherwise directed by the Fund.
4. DUTIES OF BANK WITH RESPECT TO BOOKS OF ACCOUNT AND CALCULATIONS OF NET
ASSET VALUE
The Bank shall as Agent (or as Custodian, as the case may be) keep such
books of account (including records showing the adjusted tax costs of the Fund's
portfolio securities) and render as at the close of business on each day a
detailed statement of the amounts received or paid out and of securities
received or delivered for the account of the Fund during said day and such other
statements, including a daily trial balance and inventory of the Fund's
portfolio securities; and shall furnish such other financial information and
data as from time to time requested by the Treasurer or any executive officer of
the Fund; and shall compute and determine, as of the close of business of the
New York Stock Exchange, or at such other time or times as the Board may
determine, the net asset value of a Share in the Fund, such computation and
determination to be made in accordance with the governing documents of the Fund
and the votes and instructions of the Board at the time in force and applicable,
and promptly notify the Fund and its investment adviser and such other persons
as the Fund may request of the result of such computation and determination. In
computing the net asset value the Custodian may rely upon security quotations
received by telephone or otherwise from sources or pricing services designated
by the Fund by proper instructions, and may further rely upon information
furnished to it by any authorized officer of the Fund relative (a) to
liabilities of the Fund not appearing on its books of account, (b) to the
existence, status and proper treatment of any reserve or reserves, (c) to any
procedures established by the Board regarding the valuation of portfolio
securities, and (d) to the value to be assigned to any bond, note, debenture,
Treasury bill, repurchase agreement, subscription right, security, participation
interests or other asset or property for which market quotations are not readily
available.
-17-
<PAGE>
5. RECORDS AND MISCELLANEOUS DUTIES
The Bank shall create, maintain and preserve all records relating to its
activities and obligations under this Agreement in such manner as will meet the
obligations of the Fund under the Investment Company Act of 1940, with
particular attention to Section 31 thereof and Rules 31a-1 and 31a-2 thereunder,
applicable federal and state tax laws and any other law or administrative rules
or procedures which may be applicable to the Fund. All books of account and
records maintained by the Bank in connection with the performance of its duties
under this Agreement shall be the property of the Fund, shall at all times
during the regular business hours of the Bank be open for inspection by
authorized officers, employees or agents of the Fund, and in the event of
termination of this Agreement shall be delivered to the Fund or to such other
person or persons as shall be designated by the Fund. Disposition of any account
or record after any required period of preservation shall be only in accordance
with specific instructions received from the Fund. The Bank shall assist
generally in the preparation of reports to shareholders, to the Securities and
Exchange Commission, including Forms N-SAR and N-1Q, to state "blue sky"
authorities and to others, audits of accounts, and other ministerial matters of
like nature; and, upon request, shall furnish the Fund's auditors with an
attested inventory of securities held with appropriate information as to
securities in transit or in the process of purchase or sale and with such other
information as said auditors may from time to time request. The Custodian shall
also maintain records of all receipts, deliveries and locations of such
securities, together with a current inventory thereof, and shall conduct
periodic verifications (including sampling counts at the Custodian) of
certificates representing bonds and other securities for which it is responsible
under this Agreement in such manner as the Custodian shall determine from time
to time to be advisable in order to verify the accuracy of such inventory. The
Bank shall not disclose or use any books or records it has prepared or
maintained by reason of this Agreement in any manner except as expressly
authorized herein or directed by the Fund, and the Bank shall keep confidential
any information obtained by reason of this Agreement.
6. OPINION OF FUND'S INDEPENDENT PUBLIC ACCOUNTANTS
The Custodian shall take all reasonable action, as the Fund may from time
to time request, to enable the Fund to obtain from year to year favorable
opinions from the Fund's independent public accountants with respect to its
activities hereunder in connection with the preparation of the Fund's
registration statement and Form N-SAR or other periodic reports to the
Securities and Exchange Commission and with respect to any other requirements of
such Commission.
7. COMPENSATION AND EXPENSES OF BANK
The Bank shall be entitled to reasonable compensation for its services as
Custodian and Agent, as agreed upon from time to time between the Fund and the
Bank. The Bank shall be entitled to receive from the Fund on demand
reimbursement for its cash disbursements, expenses and charges, including
counsel fees, in connection with its duties as Custodian and Agent hereunder,
but excluding salaries and usual overhead expenses.
8. RESPONSIBILITY OF BANK
So long as and to the extent that it is in the exercise of reasonable care,
the Bank as Custodian and Agent shall be held harmless in acting upon any
notice, request, consent, certificate or other instrument reasonably believed by
it to be genuine and to be signed by the proper party or parties.
-18-
<PAGE>
The Bank as Custodian and Agent shall be entitled to rely on and may act
upon advice of counsel (who may be counsel for the Fund) on all matters, and
shall be without liability for any action reasonably taken or omitted pursuant
to such advice.
The Bank as Custodian and Agent shall be held to the exercise of reasonable
care in carrying out the provisions of this Agreement but shall be liable only
for its own negligent or bad faith acts or failures to act. Notwithstanding the
foregoing, nothing contained in this paragraph is intended to nor shall it be
construed to modify the standards of care and responsibility set forth in
Section 2 hereof with respect to subcustodians and in subparagraph f of
Paragraph L of Section 3 hereof with respect to Securities Systems and in
subparagraph g of Paragraph M of Section 3 hereof with respect to an Approved
Book-Entry System for Commercial Paper.
The Custodian shall be liable for the acts or omissions of a foreign
banking institution to the same extent as set forth with respect to
subcustodians generally in Section 2 hereof, provided that, regardless of
whether assets are maintained in the custody of a foreign banking institution, a
foreign securities depository or a branch of a U.S. bank, the Custodian shall
not be liable for any loss, damage, cost, expense, liability or claim resulting
from, or caused by, the direction of or authorization by the Fund to maintain
custody of any securities or cash of the Fund in a foreign county including, but
not limited to, losses resulting from nationalization, expropriation, currency
restrictions, acts of war, civil war or terrorism, insurrection, revolution,
military or usurped powers, nuclear fission, fusion or radiation, earthquake,
storm or other disturbance of nature or acts of God.
If the Fund requires the Bank in any capacity to take any action with
respect to securities, which action involves the payment of money or which
action may, in the opinion of the Bank, result in the Bank or its nominee
assigned to the Fund being liable for the payment of money or incurring
liability of some other form, the Fund, as a prerequisite to requiring the
Custodian to take such action, shall provide indemnity to the Custodian in an
amount and form satisfactory to it.
9. PERSONS HAVING ACCESS TO ASSETS OF THE FUND
(i) No trustee, director, general partner, officer, employee or agent of
the Fund shall have physical access to the assets of the Fund held by the
Custodian or be authorized or permitted to withdraw any investments of the Fund,
nor shall the Custodian deliver any assets of the Fund to any such person. No
officer or director, employee or agent of the Custodian who holds any similar
position with the Fund or the investment adviser of the Fund shall have access
to the assets of the Fund.
(ii) Access to assets of the Fund held hereunder shall only be available to
duly authorized officers, employees, representatives or agents of the Custodian
or other persons or entities for whose actions the Custodian shall be
responsible to the extent permitted hereunder, or to the Fund's independent
public accountants in connection with their auditing duties performed on behalf
of the Fund.
(iii) Nothing in this Section 9 shall prohibit any officer, employee or
agent of the Fund or of the investment adviser of the Fund from giving
instructions to the Custodian or executing a certificate so long as it does not
result in delivery of or access to assets of the Fund prohibited by paragraph
(i) of this Section 9.
-19-
<PAGE>
10. EFFECTIVE PERIOD, TERMINATION AND AMENDMENT; SUCCESSOR CUSTODIAN
This Agreement shall become effective as of its execution, shall continue
in full force and effect until terminated by either party after August 31, 2000
by an instrument in writing delivered or mailed, postage prepaid to the other
party, such termination to take effect not sooner than sixty (60) days after the
date of such delivery or mailing; PROVIDED, that the Fund may at any time by
action of its Board, (i) substitute another bank or trust company for the
Custodian by giving notice as described above to the Custodian in the event the
Custodian assigns this Agreement to another party without consent of the
noninterested Trustees of the Funds, or (ii) immediately terminate this
Agreement in the event of the appointment of a conservator or receiver for the
Custodian by the Federal Deposit Insurance Corporation or by the Banking
Commissioner of The Commonwealth of Massachusetts or upon the happening of a
like event at the direction of an appropriate regulatory agency or court of
competent jurisdiction. Upon termination of the Agreement, the Fund shall pay to
the Custodian such compensation as may be due as of the date of such termination
(and shall likewise reimburse the Custodian for its costs, expenses and
disbursements).
This Agreement may be amended at any time by the written agreement of the
parties hereto. If a majority of the non-interested trustees of any of the Funds
determines that the performance of the Custodian has been unsatisfactory or
adverse to the interests of shareholders of any Fund or Funds or that the terms
of the Agreement are no longer consistent with publicly available industry
standards, then the Fund or Funds shall give written notice to the Custodian of
such determination and the Custodian shall have 60 days to (1) correct such
performance to the satisfaction of the non-interested trustees or (2)
renegotiate terms which are satisfactory to the non-interested trustees of the
Funds. If the conditions of the preceding sentence are not met then the Fund or
Funds may terminate this Agreement on sixty (60) days written notice.
The Board of the Fund shall, forthwith, upon giving or receiving notice of
termination of this Agreement, appoint as successor custodian, a bank or trust
company having the qualifications required by the Investment Company Act of 1940
and the Rules thereunder. The Bank, as Custodian, Agent or otherwise, shall,
upon termination of the Agreement, deliver to such successor custodian, all
securities then held hereunder and all funds or other properties of the Fund
deposited with or held by the Bank hereunder and all books of account and
records kept by the Bank pursuant to this Agreement, and all documents held by
the Bank relative thereto. In the event that no written order designating a
successor custodian shall have been delivered to the Bank on or before the date
when such termination shall become effective, then the Bank shall not deliver
the securities, funds and other properties of the Fund to the Fund but shall
have the right to deliver to a bank or trust company doing business in Boston,
Massachusetts of its own selection meeting the above required qualifications,
all funds, securities and properties of the Fund held by or deposited with the
Bank, and all books of account and records kept by the Bank pursuant to this
Agreement, and all documents held by the Bank relative thereto. Thereafter such
bank or trust company shall be the successor of the Custodian under this
Agreement.
11. INTERPRETIVE AND ADDITIONAL PROVISIONS
In connection with the operation of this Agreement, the Custodian and the
Fund may from time to time agree on such provisions interpretive of or in
addition to the provisions of this Agreement as may in their joint opinion be
consistent with the general tenor of this Agreement. Any such interpretive or
additional provisions shall be in a writing signed by both parties and shall be
annexed hereto, PROVIDED that no such interpretive or additional provisions
shall contravene any applicable federal or state regulations or any provision of
the governing instruments of the Fund. No interpretive or additional provisions
made as provided in the preceding sentence shall be deemed to be an amendment of
this Agreement.
-20-
<PAGE>
12. NOTICES
Notices and other writings delivered or mailed postage prepaid to the Fund
addressed to 24 Federal Street, Boston, Massachusetts 02110, or to such other
address as the Fund may have designated to the Bank, in writing, or to Investors
Bank & Trust Company, 24 Federal Street, Boston, Massachusetts 02110, shall be
deemed to have been properly delivered or given hereunder to the respective
addressees.
13. MASSACHUSETTS LAW TO APPLY
This Agreement shall be construed and the provisions thereof interpreted
under and in accordance with the laws of The Commonwealth of Massachusetts.
If the Fund is a Massachusetts business trust, the Custodian expressly
acknowledges the provision in the Fund's declaration of Trust limiting the
personal liability of the trustees and shareholders of the Fund; and the
Custodian agrees that it shall have recourse only to the assets of the Fund for
the payment of claims or obligations as between the Custodian and the Fund
arising out of this Agreement, and the Custodian shall not seek satisfaction of
any such claim or obligation from the trustees or shareholders of the Fund.
14. ADOPTION OF THE AGREEMENT BY THE FUND
The Fund represents that its Board has approved this Agreement and has duly
authorized the Fund to adopt this Agreement, such adoption to be evidenced by a
letter agreement between the Fund and the Bank reflecting such adoption, which
letter agreement shall be dated and signed by a duly authorized officer of the
Fund and duly authorized officer of the Bank. This Agreement shall be deemed to
be duly executed and delivered by each of the parties in its name and behalf by
its duly authorized officer as of the date of such letter agreement, and this
Agreement shall be deemed to supersede and terminate, as of the date of such
letter agreement, all prior agreements between the Fund and the Bank relating to
the custody of the Fund's assets.
* * * * *
-21-
EATON VANCE SERIES TRUST
ADMINISTRATIVE SERVICES AGREEMENT
AGREEMENT made this 30th day of August, 1996, between Eaton Vance
Series Trust, a Massachusetts business trust (the "Trust") on behalf of each of
its series listed on Schedule A (the "Funds") and Eaton Vance Management, a
Massachusetts business Trust, (the "Administrator").
IN CONSIDERATION of the mutual promises and undertakings herein
contained, the parties hereto agree with respect to each Fund:
1. DUTIES OF THE ADMINISTRATOR. The Trust hereby employs the
Administrator to act as administrator of the Fund and to administer its affairs,
subject to the supervision of the Trustees of the Trust, for the period and on
the terms set forth in this Agreement.
The Administrator hereby accepts such employment, and undertakes to
afford to the Trust the advice and assistance of the Administrator's
organization in the administration of the Fund and to furnish for the use of the
Fund office space and all necessary office facilities, equipment and personnel
for administering the affairs of the Fund and to pay the salaries and fees of
all officers and Trustees of the Trust who are members of the Administrator's
organization and all personnel of the Administrator performing services relating
to administrative activities. The Administrator shall for all purposes herein be
deemed to be an independent contractor and shall, except as otherwise expressly
provided or authorized, have no authority to act for or represent the Trust in
any way or otherwise be deemed an agent of the Trust.
Notwithstanding the foregoing, the Administrator shall not be deemed to
have assumed any duties with respect to, and shall not be responsible for, the
management of the Fund's assets or the rendering of investment advice and
supervision with respect thereto or the distribution of shares of the Fund, nor
shall the Administrator be deemed to have assumed or have any responsibility
with respect to functions specifically assumed by any transfer agent, custodian
or shareholder servicing agent of the Trust or the Fund. It is intended that the
assets of the Fund will be invested in an interest in a registered open-end
investment company having substantially the same investment objective, policies
and restrictions as the Fund (the "Portfolio"). Boston Management and Research
("BMR"), an affiliate of the Administrator, currently acts as investment adviser
to the Portfolio under an Investment Advisory Agreement between the Portfolio
and BMR.
2. ALLOCATION OF CHARGES AND EXPENSES. The Administrator shall pay the
entire salaries and fees of all of the Trust's Trustees and officers who devote
part or all of their time to the affairs of the Administrator, and the salaries
and fees of such persons shall not be deemed to be expenses incurred by the
Trust for purposes of this Section 2. Except as provided in the foregoing
sentence, the Administrator shall not pay any expenses relating to the Trust or
the Fund including, without implied limitation, (i) expenses of maintaining the
Fund and continuing its existence, (ii) registration of the Trust under the
Investment Company Act of 1940, (iii) commissions, fees and other expenses
connected with the acquisition, disposition and valuation of securities and
other investments, (iv) auditing, accounting and legal expenses, (v) taxes and
interest, (vi) governmental fees, (vii) expenses of issue, sale, repurchase and
redemption of shares, (viii) expenses of registering and qualifying the Trust,
the Fund and its shares under federal and state securities laws and of preparing
and printing prospectuses for such purposes and for distributing the same to
shareholders and investors, and fees and expenses of registering and maintaining
registrations of the Fund and of the Fund's principal underwriter, if any, as
broker-dealer or agent under state securities laws, (ix) expenses of reports and
notices to shareholders and of meetings of shareholders and proxy solicitations
therefor, (x) expenses of reports to governmental officers and commissions, (xi)
insurance expenses, (xii) association membership dues (xiii) fees, expenses and
disbursements of custodians and subcustodians for all services to the Fund
<PAGE>
(including without limitation safekeeping of funds, securities and other
investments, keeping of books and accounts and determination of net asset
values), (xiv) fees, expenses and disbursements of transfer agents, dividend
disbursing agents, shareholder servicing agents and registrars for all services
to the Fund, (xv) expenses for servicing shareholder accounts, (xvi) any direct
charges to shareholders approved by the Trustees of the Trust, (xvii)
compensation and expenses of Trustees of the Trust who are not members of the
Adviser's organization, and (xviii) such non-recurring items as may arise,
including expenses incurred in connection with litigation, proceedings and
claims and the obligation of the Trust to indemnify its Trustees and officers
with respect thereto.
3. COMPENSATION OF ADMINISTRATOR. The Board of Trustees of the Trust
have currently determined that, based on the current level of compensation
payable to BMR by the Portfolio under the Portfolio's present Investment
Advisory Agreement with BMR, the Administrator shall receive no compensation
from the Trust or the Fund in respect of the services to be rendered and the
facilities to be provided by the Administrator under this Agreement. If the
Trustees determine that the Trust or Fund, should compensate the Administrator
for such services and facilities, such compensation shall be set forth in a new
agreement or in an amendment to this Agreement to be entered into by the parties
hereto.
4. OTHER INTERESTS. It is understood that Trustees and officers of the
Trust and shareholders of the Fund are or may be or become interested in the
Administrator as trustees, officers, employees, shareholders or otherwise and
that trustees, officers, employees and shareholders of the Administrator are or
may be or become similarly interested in the Fund, and that the Administrator
may be or become interested in the Fund as shareholder or otherwise. It is also
understood that trustees, officers, employees and shareholders of the
Administrator may be or become interested (as directors, trustees, officers,
employees, stockholders or otherwise) in other companies or entities (including,
without limitation, other investment companies) which the Administrator may
organize, sponsor or acquire, or with which it may merge or consolidate, and
which may include the words "Eaton Vance" or "Eaton & Howard" or "Vance Sanders"
or any combination thereof as part of their name, and that the Administrator or
its subsidiaries or affiliates may enter into advisory or management or
administration agreements or other contracts or relationships with such other
companies or entities.
5. LIMITATION OF LIABILITY OF THE ADMINISTRATOR. The services of the
Administrator to the Trust and the Fund are not to be deemed to be exclusive,
the Administrator being free to render services to others and engage in other
business activities. In the absence of willful misfeasance, bad faith, gross
negligence or reckless disregard of obligations or duties hereunder on the part
of the Administrator, the Administrator shall not be subject to liability to the
Trust or the Fund or to any shareholder of the Fund for any act or omission in
the course of, or connected with, rendering services hereunder or for any losses
which may be sustained in the acquisition, holding or disposition of any
security or other investment.
6. SUB-ADMINISTRATORS. The Administrator may employ one or more
sub-administrators from time to time to perform such of the acts and services of
the Administrator and upon such terms and conditions as may be agreed upon
between the Administrator and such sub-administrators and approved by the
Trustees of the Trust.
7. DURATION AND TERMINATION OF THIS AGREEMENT. This Agreement shall
become effective upon the date of its execution, and, unless terminated as
herein provided, shall remain in full force and effect through and including
February 28, 1997 and shall continue in full force and effect indefinitely
thereafter, but only so long as such continuance after February 28, 1997 is
specifically approved at least annually (i) by the Board of Trustees of the
Trust and (ii) by the vote of a majority of those Trustees of the Trust who are
not interested persons of the Administrator or the Trust.
2
<PAGE>
Either party hereto may, at any time on sixty (60) days' prior written
notice to the other, terminate this Agreement without the payment of any
penalty, by action of Trustees of the Trust or the trustee of the Administrator,
as the case may be, and the Trust may, at any time upon such written notice to
the Administrator, terminate this Agreement by vote of a majority of the
outstanding voting securities of the Fund. This Agreement shall terminate
automatically in the event of its assignment.
8. AMENDMENTS OF THE AGREEMENT. This Agreement may be amended by a
writing signed by both parties hereto, provided that no amendment to this
Agreement shall be effective until approved (i) by the vote of a majority of
those Trustees of the Trust who are not interested persons of the Administrator
or the Trust, and (ii) by vote of the Board of Trustees of the Trust. Additional
series of the Trust, however, will become a Fund hereunder upon approval by the
Trustees of the Trust and amendment of Schedule A.
9. LIMITATION OF LIABILITY. The Fund shall not be responsible for the
obligations of any other series of the Trust. The Administrator expressly
acknowledges the provision in the Declaration of Trust of the Trust limiting the
personal liability of shareholders of the Fund and of the officers and Trustees
of the Trust, and the Administrator hereby agrees that it shall have recourse to
the Trust or the Fund for payment of claims or obligations as between the Trust
or the Fund and the Administrator arising out of this Agreement and shall not
seek satisfaction from the shareholders or any shareholder of the Fund or from
the officers or Trustees of the Trust.
10. USE OF THE NAME "EATON VANCE." The Administrator hereby consents to
the use by the Fund of the name "Eaton Vance" as part of the Fund's name;
provided, however, that such consent shall be conditioned upon the employment of
the Administrator or one of its affiliates as the administrator of the Fund. The
name "Eaton Vance" or any variation thereof may be used from time to time in
other connections and for other purposes by the Administrator and its affiliates
and other investment companies that have obtained consent to the use of the name
"Eaton Vance." The Administrator shall have the right to require the Fund to
cease using the name "Eaton Vance" as part of the Fund's name if the Fund
ceases, for any reason, to employ the Administrator or one of its affiliates as
the Fund's administrator. Future names adopted by the Fund for itself, insofar
as such names include identifying words requiring the consent of the
Administrator, shall be the property of the Administrator and shall be subject
to the same terms and conditions.
11. CERTAIN DEFINITIONS. The terms "assignment" and "interested
persons" when used herein shall have the respective meanings specified in the
Investment Company Act of 1940 as now in effect or as hereafter amended subject,
however, to such exemptions as may be granted by the Securities and Exchange
Commission by any rule, regulation or order. The term "vote of a majority of the
outstanding voting securities" shall mean the vote of the lesser of (a) 67 per
centum or more of the shares of the Fund present or represented by proxy at the
meeting if the holders of more than 50 per centum of the outstanding shares of
the Fund are present or represented by proxy at the meeting, or (b) more than 50
per centum of the outstanding shares of the Fund.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed on the day and year first above written.
EATON VANCE SERIES TRUST EATON VANCE MANAGEMENT
By /s/ Landon T. Clay By /s/ James B. Hawkes
- --------------------------- -----------------------------
PRESIDENT VICE PRESIDENT AND NOT
INDIVIDUALLY
3
<PAGE>
SCHEDULE A
Eaton Vance Series Trust
ADMINISTRATIVE SERVICES AGREEMENT
Dated August 30, 1996
Vance Sanders Exchange Fund
<TABLE> <S> <C>
<ARTICLE> 6
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 196,304
<INVESTMENTS-AT-VALUE> 236,798
<RECEIVABLES> 295,926
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 237,175
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 0
<TOTAL-LIABILITIES> 143
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 0
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<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 237,032
<DIVIDEND-INCOME> 3,766
<INTEREST-INCOME> 228
<OTHER-INCOME> 0
<EXPENSES-NET> 1,486
<NET-INVESTMENT-INCOME> 2,508
<REALIZED-GAINS-CURRENT> 9,325
<APPREC-INCREASE-CURRENT> 51,654
<NET-CHANGE-FROM-OPS> 63,487
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 0
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 0
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 54,424
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 118
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 237,032
<PER-SHARE-NAV-BEGIN> 308.44
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 347.57
<EXPENSE-RATIO> 0.70
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000102818
<NAME>VANCE SANDERS EXCHANGE FUND
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> JUN-30-1996
<INVESTMENTS-AT-COST> 41,787
<INVESTMENTS-AT-VALUE> 261,094
<RECEIVABLES> 346
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 261,477
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 162
<TOTAL-LIABILITIES> 162
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 38,844
<SHARES-COMMON-STOCK> 672
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 3,161
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 219,309
<NET-ASSETS> 261,314
<DIVIDEND-INCOME> 2,050
<INTEREST-INCOME> 185
<OTHER-INCOME> 0
<EXPENSES-NET> 890
<NET-INVESTMENT-INCOME> 1,345
<REALIZED-GAINS-CURRENT> 4,682
<APPREC-INCREASE-CURRENT> 23,003
<NET-CHANGE-FROM-OPS> 29,030
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 1,345
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 0
<NUMBER-OF-SHARES-REDEEMED> 10,050
<SHARES-REINVESTED> 368
<NET-CHANGE-IN-ASSETS> 24,282
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 746
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 890
<AVERAGE-NET-ASSETS> 248,706
<PER-SHARE-NAV-BEGIN> 347.570
<PER-SHARE-NII> 2.048
<PER-SHARE-GAIN-APPREC> 40.832
<PER-SHARE-DIVIDEND> 1.750
<PER-SHARE-DISTRIBUTIONS> 0.00
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 388.700
<EXPENSE-RATIO> 0.72
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0.00
</TABLE>
