IMPERIAL SPECIAL INVESTMENTS INC
N-2, EX-99.2.B, 2000-07-26
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                       IMPERIAL SPECIAL INVESTMENTS, INC.

                            A CALIFORNIA CORPORATION



                                     BYLAWS







                                 April 24, 2000




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                                     BYLAWS

                                       OF

                        IMPERIAL SPECIAL INVESTMENTS, INC.
                            (A CALIFORNIA CORPORATION)

                                    ARTICLE I

                        NAME OF CORPORATION, LOCATION OF
                                OFFICES AND SEAL

Section 1 . Name.  The name of the Corporation is Imperial Special Investments,
Inc.

Section 2. Principal Offices. The principal office of the Corporation is in the
City of Inglewood, California. The Corporation may, in addition, establish and
maintain such other offices and places of business as the Board of Directors
may, from time to time, determine.

Section 3. Seal. The Corporation need not have a seal, but if it chooses to have
one, the corporate seal of the Corporation shall be circular in form and shall
bear the name of the Corporation, the year of its incorporation, and the word
"California." The form of the seal shall be subject to alteration by the Board
of Directors and the seal may be used by causing it or a facsimile to be
impressed or affixed or printed or otherwise reproduced. Any officer or Director
of the Corporation shall have authority to affix the corporate seal of the
Corporation to any document requiring the same.

                                   ARTICLE II

                                  SHAREHOLDERS

Section 1. Place of Meetings. Meetings of shareholders shall be held at any
place within or outside the State of California designated by the Board of
Directors. In the absence of any such designation, shareholders' meetings shall
be held at the principal executive office of the Corporation.

Section 2. Annual Meetings. The annual meeting of shareholders shall be held
each year on the third Thursday in May, or at such other date as the Board of
Directors may set by resolution. However, if this day falls on a legal holiday,
then the meeting shall be held at the same time and place on the next succeeding
full business day. At this meeting, Directors shall be elected and any other
proper business may be transacted.

Section 3. Special Meetings. Special meetings of shareholders may be called at
any time by the Board of Directors, or by the Chairman of the Board, or by the
President, and shall be held at such time and place as may be stated in the
notice of the meeting.



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Special meetings of the shareholders may be called by the Secretary upon the
written request of the holders of shares entitled to vote not less than ten
percent (10%) of all the votes entitled to be cast at such meeting, provided
that (1) such request shall state the purposes of such meeting and the matters
proposed to be acted on, and (2) the shareholders requesting such meeting shall
have paid to the Corporation the reasonably estimated cost of preparing and
mailing the notice thereof, which the Secretary shall determine and specify to
such shareholders. No special meeting shall be called upon the request of
shareholders to consider any matter which is substantially the same as a matter
voted upon at any special meeting of the shareholders held during the preceding
twelve months, unless requested by the holders of a majority of all shares
entitled to be voted at such meeting.

Section 4. Notice of Annual and Special Meetings. The Secretary shall cause
notice of the place, date, and hour, and, in the case of a special meeting, the
purpose or purposes for which the meeting is called, to be mailed, postage
prepaid, not less than ten (10) (thirty-five (35) in the case of special
meetings) nor more than sixty (60) days before the date of the meeting, to each
shareholder entitled to vote at such meeting at his or her address as it appears
on the records of the Corporation at the time of such mailing. Notice shall be
deemed to be given when deposited in the United States mail addressed to the
shareholders as aforesaid. Notice of any shareholders' meeting need not be given
to any shareholder who shall sign a written waiver of such notice whether before
or after the time of such meeting, or to any shareholder who is present at such
meeting in person or by proxy. Notice of adjournment of a shareholders' meeting
to another time or place need not be given if such time and place are announced
at the meeting. Irregularities in the notice of any meeting to, or the
nonreceipt of any such notice by, any of the shareholders shall not invalidate
any action otherwise properly taken by or at any such meeting.

Section 5. Quorum and Adjournment of Meetings. The presence in person or by
proxy of the holders of a majority of the shares entitled to vote at any meeting
of shareholders shall constitute a quorum for the transaction of business. The
shareholders present at a duly called or held meeting at which a quorum is
present may continue to do business until adjournment, notwithstanding the
withdrawal of enough shareholders to leave less than a quorum, if any action
taken (other than adjournment) is approved by at least a majority of the shares
required to constitute a quorum.

Any shareholder's meeting, annual or special, whether or not a quorum is
present, may be adjourned from time to time by the vote of the majority of the
shares represented at that meeting, either in person or by proxy, but in the
absence of a quorum no other business may be transacted at that meeting, except
as provided in this Section.

When any meeting of shareholders, either annual or special, is adjourned to
another time or place, notice need not be given of the adjourned meeting at
which the adjournment is taken, unless a new record date of the adjourned
meeting is fixed or unless the adjournment is for more than forty-five (45) days
from the date set for the original meeting, in which case the Board of Directors
shall set a new record date. Notice of any such adjourned meeting shall be given
to each shareholder of record entitled to vote at the adjourned meeting in
accordance with the provisions of Section 4 of this Article II. At any adjourned
meeting the corporation may transact any business which might have been
transacted at the original meeting.



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Section 6. Voting. Except as otherwise provided in the Articles of Incorporation
or by applicable law, at each shareholders' meeting each shareholder shall be
entitled to one vote for each share of stock of the Corporation validly issued
and outstanding and registered in his or her name on the books of the
Corporation on the record date fixed in accordance with Section 5 of Article VI
hereof, either in person or by proxy appointed by instrument in writing
subscribed by such shareholder or his or her duly authorized attorney, except
that no shares held by the Corporation shall be entitled to a vote.

Except as otherwise provided in the Articles of Incorporation, these Bylaws, as
required by provisions of the Investment Company Act of 1940, as amended ("1940
Act") or as required under California law, all matters shall be decided by a
vote of the majority of the votes validly cast. The vote upon any question shall
be by ballot whenever requested by any person entitled to vote, but, unless such
a request is made, voting may be conducted in any way approved at the meeting.

At any meeting at which there is an election of Directors, the Chairman of the
meeting may, and upon the request of the holders of ten percent (10%) of the
stock entitled to vote at such election shall, appoint two inspectors of
election who shall first subscribe an oath or affirmation to execute faithfully
the duties of inspectors at such election with strict impartiality and according
to the best of their ability, and shall, after the election, make a certificate
of the result of the vote taken. No candidate for the office of Director shall
be appointed as an inspector.

Section 7. Validity of Proxies. The right to vote by proxy shall exist only if
the instrument authorizing such proxy to act shall have been signed by the
shareholder or by his or her duly authorized attorney. All proxies shall be
delivered to the Secretary of the Corporation or to the person acting as
Secretary of the meeting before being voted, who shall decide all questions
concerning qualification of voters, the validity of proxies, and the acceptance
or rejection of votes. If inspectors of election have been appointed by the
Chairman of the meeting, such inspectors shall decide all such questions. A
proxy with respect of stock held in the name of two or more persons shall be
valid if executed by one of them unless at or prior to exercise of such proxy
the Corporation receives a specific written notice to the contrary from any one
of them. A proxy purporting to be executed by or on behalf of a shareholder
shall be deemed valid unless challenged at or prior to its exercise.

A validly executed proxy which does not state that it is irrevocable shall
continue in full force and effect unless (i) revoked by the person executing it
before the vote pursuant to that proxy by a writing delivered to the corporation
stating that the proxy is revoked or by a subsequent proxy executed by or
attendance at the meeting and voting in person by the person executing that
proxy; or (ii) written notice of the death or incapacity of the maker of that
proxy is received by the corporation before the vote pursuant to that proxy is
counted; provided however, that no proxy shall be valid after the expiration of
eleven (11) months from the date of the proxy unless otherwise provided in the
proxy. The revocability of a proxy that states on its face that it is
irrevocable shall be governed by the provisions of the California General
Corporation Law.



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Section 8. Stock Ledger and List of Shareholders. The corporation shall keep at
its principal executive office or at the office of its transfer agent or
registrar, if either be appointed and as determined by resolution of the Board
of Directors, a record of its shareholders, giving the names and addresses of
all shareholders and the number and class of shares held by each shareholder.

     A shareholder or shareholders of the corporation holding at least five
percent (5%) in the aggregate of the outstanding voting shares of the
corporation may (i) inspect and copy the records of shareholders' names and
addresses and shareholdings during usual business hours on five (5) days' prior
written demand on the corporation, and (ii) obtain from the transfer agent of
the corporation, on written demand and on the tender of such transfer agent's
usual charges for such list, a list of the shareholder's names and addresses who
are entitled to vote for the election of directors and their shareholdings as of
the most recent record date for which that list has been compiled or as of a
date specified by the shareholder after the date of demand. This list shall be
made available to any such shareholder by the transfer agent on or before the
later of five (5) days after the demand is received or the date specified in the
demand as the date as of which the list is to be compiled. The record of
shareholders shall also be open to inspection on the written demand of any
shareholder or holder of a voting trust certificate at any time during usual
business hours for a purpose reasonably related to the holder's interests as a
shareholder or as the holder of a voting trust certificate. Any inspection and
copying under this Section 1 may be made in person or by an agent or attorney of
the shareholder or holder of voting trust certificate making the demand.

Section 9. Maintenance and Inspection of Bylaws. The corporation shall keep at
its principal executive office or if its principal executive office is not in
the State of California, at its principal business office in this state, the
original or a copy of the Bylaws as amended to date, which shall be open to
inspection by the shareholders at all reasonable times during office hours. If
the principal executive office of the corporation is outside the State of
California and the corporation has no principal business office in this state,
the secretary shall upon the written request of any shareholder furnish to that
shareholder a copy of the Bylaws as amended to date.

Section 10. Maintenance and Inspection of Other Corporate Records. The
accounting books and records and minutes of proceedings of the shareholders and
the Board of Directors and any committee or committees of the Board of Directors
shall be kept at such place or places designated by the Board of Directors or in
the absence of such designation, at the principal executive office of the
corporation. The minutes shall be kept in written form and the accounting books
and records shall be kept either in written form or in any other form capable of
being converted into written form. The minutes and accounting books and records
shall be open to inspection upon the written demand of any shareholder or holder
of a voting trust certificate at any reasonable time during usual business hours
for a purpose reasonably related to the holder's interests as a shareholder or
as the holder of a voting trust certificate. The inspection may be made in
person or by an agent or attorney and shall include the right to copy and make
extracts. These rights of inspection shall extend to the records of each
subsidiary corporation of the corporation.

Section 11. Inspection by Directors. Every director shall have the absolute
right at any reasonable time to inspect all books, records, and documents of
every kind and the physical



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properties of the corporation and each of its subsidiary corporations. This
inspection by a director may be made in person or by an agent or attorney and
the right of inspection includes the right to copy and make extracts of
documents.

Section 12. Annual Report to Shareholders. The annual report to shareholders
referred to in the California General Corporation Law is expressly dispensed
with, but nothing herein shall be interpreted as prohibiting the Board of
Directors from issuing annual or other periodic reports to the shareholders of
the corporation as they consider appropriate.

Section 13. Financial Statements. A copy of any annual financial statements and
any income statement of the corporation for each quarterly period of each fiscal
year and accompanying balance sheet of the corporation as of the end of each
such period that has been prepared by the corporation shall be kept on file in
the principal executive office of the corporation for twelve (12) months and
each such statement shall be exhibited at all reasonable times to any
shareholder demanding an examination of any such statement or a copy shall be
mailed to any such shareholder.

If a shareholder or shareholders holding at least five percent (5%) of the
outstanding shares of any class of stock of the corporation makes a written
request to the corporation for an income statement of the corporation for the
three (3) -month, six (6) -month, or nine (9) -month period of the then current
fiscal year ended more than thirty (30) days before the date of the request and
a balance sheet of the corporation as of the end of that period, the chief
financial officer shall cause that statement to be prepared, if not already
prepared, and shall deliver personally or mail that statement or statements to
the person making the request within thirty (30) days after the receipt of the
request. If the corporation has not sent to the shareholders its annual report
for the last fiscal year, this report shall likewise be delivered or mailed to
the shareholder or shareholders within thirty (30) days after the request.

The corporation shall also on the written request of any shareholder mail to the
shareholder a copy of the last annual, semi-annual or quarterly income statement
which it has prepared and a balance sheet as of the end of that period.

The quarterly income statements and balance sheets referred to in this section
shall be accompanied by the report, if any, of any independent accountants
engaged by the corporation or the certificate of an authorized officer of the
corporation that the financial statements were prepared without audit from the
books and records of the corporation.

Section 14. Annual Statement of General Information. The corporation shall
during the month in which the anniversary of its incorporation occurs in each
year, file with the California Secretary of State on the prescribed form a
statement setting forth the authorized number of directors, the names and
complete business or residence addresses of all incumbent directors, the names
and complete business or residence addresses of the chief executive officer,
secretary and chief financial officer, the street address of its principal
executive office or principal business office in this state and the general type
of business constituting the principal business activity of the corporation,
together with a designation of the agent of the corporation for the purpose of
service of process, all in compliance with the California General Corporation
Law.



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Section 15. Action Without Meeting. Any action required or permitted to be taken
by shareholders at a meeting of shareholders may be taken without a meeting if
(1) all shareholders entitled to vote on the matter sign a written consent to
the action, (2) all shareholders entitled to notice of the meeting but not
entitled to vote at it sign a written waiver of any right to dissent, and (3)
the consents and waivers are filed with the records of the meetings of
shareholders. Such consent shall be treated for all purposes as a vote at the
meeting.

                                   ARTICLE III

                               BOARD OF DIRECTORS

Section 1. Powers. Subject to the provisions of the California General
Corporation Law and to any limitations in the Articles of Incorporation relating
to action required to be approved by the shareholders, as that term is defined
in California Corporations Code section 153, or by the outstanding shares, as
that term is defined in California Corporations Code section 152, the business
and affairs of the corporation shall be managed and all corporate powers shall
be exercised by or under the direction of the Board of Directors. The Board may
delegate the management of the day-to-day operation of the business of the
corporation to a management company or other person provided that the business
and affairs of the corporation shall be managed and all corporate powers shall
be exercised under the ultimate direction of the Board.

Section 2. Number and Term of Directors. Except for the initial Board of
Directors, the Board of Directors shall consist of not fewer than three nor more
than nine Directors, as specified by a resolution of a majority of the entire
Board of Directors. Directors need not be shareholders of the Corporation. All
acts done at any meeting of the Directors or by any person acting as a Director,
so long as his or her successor shall not have been duly elected or appointed,
shall, notwithstanding that it be afterwards discovered that there was some
defect in the election of the Directors or of such person acting as a Director,
or that they or any of them were disqualified, be as valid as if the Directors
or such other person, as the case may be, had been duly elected and were or was
qualified to be Directors or a Director of the Corporation. Each Director shall
hold office until his or her successor is elected and qualified or until his or
her earlier death, resignation, or removal.

Section 3. Election. Unless otherwise required by the 1940 Act, at each annual
meeting of shareholders, Directors shall be elected by vote of the holders of a
majority of the shares present in person or by proxy and entitled to vote
thereon. A plurality of all the votes cast at a meeting at which a quorum is
present is sufficient to elect a Director.

Section 3.1. Resignation. Any Director may resign effective on giving written
notice to the Board Chairperson, the President, the Secretary, or the Board of
Directors of the corporation, unless the notice specifies a later time for the
effectiveness of the resignation. If the resignation is effective at a future
time, a successor may be elected to take office when the resignation becomes
effective.



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Section 4. Vacancies and Newly Created Directorships. If any vacancies shall
occur in the Board of Directors by reason of death, resignation, removal, or
otherwise, or if the authorized number of Directors shall be increased, the
Directors then in office shall continue to act, and such vacancies (if not
previously filled by the shareholders) may be filled by a majority of the
Directors then in office, although less than a quorum, except that a newly
created Directorship may be filled only by a majority vote of the entire Board
of Directors; provided, however, that if, at any time that there are
shareholders of the Corporation, immediately after filling such vacancy at least
two-thirds (2/3) of the Directors then holding office shall have been elected to
such office by the shareholders of the Corporation. In the event that at any
time, other than the time preceding the first annual shareholders' meeting, less
than a majority of the Directors of the Corporation holding office at that time
were elected by the shareholders, a meeting of the shareholders shall be held
promptly, and in any event within sixty days, for the purpose of electing
Directors to fill any existing vacancies in the Board of Directors, unless the
Securities and Exchange Commission shall by order extend such period.

Section 5. Removal. At any shareholders' meeting duly called, provided a quorum
is present, the shareholders may remove any Director from office (either with or
without cause) and may elect a successor or successors to fill any resulting
vacancies for the unexpired terms of the removed Director or Directors. A
majority of all the votes entitled to be cast for the election of Directors is
sufficient to remove a Director.

Section 6. Annual and Regular Meetings. The annual meeting of the Board of
Directors for choosing officers and transacting other proper business shall be
held at such other time and place as the Board may determine. The Board of
Directors from time to time may provide by resolution for the holding of regular
meetings and fix their time and place within or outside the State of California.
Except as otherwise provided in the 1940 Act, notice of such annual and regular
meetings need not be given, provided that notice of any change in the time or
place of such meetings shall be sent promptly to each Director not present at
the meeting at which such change was made, in the manner provided for notice of
special meetings. Except as otherwise provided under the 1940 Act, members of
the Board of Directors or any committee designated thereby may participate in a
meeting of such Board or committee by means of a conference telephone or similar
communications equipment that allows all persons participating in the meeting to
hear each other at the same time.

Section 7. Special Meetings. Special meetings of the Board of Directors shall be
held whenever called by the Chairman of the Board, the Vice Chairman, the
President (or, in the absence or disability of the President, by any Vice
President), the Chief Financial Officer, or by two or more Directors, at the
time and place (within or without the State of California) specified in the
respective notice or waivers of notice of such meetings. Notice of special
meetings, stating the time and place, shall be (1) mailed to each Director at
his or her residence or regular place of business at least three days before the
day on which a special meeting is to be held, or (2) delivered to him or her
personally or transmitted to him or her by telegraph, telecopy, telex, cable, or
wireless at least one day before the meeting.



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Section 8. Waiver of Notice. No notice of any meeting need be given to any
Director who is present at the meeting or who waives notice of such meeting in
writing (which waiver shall be filed with the records of such meeting) either
before or after the time of the meeting.

Section 9. Quorum and Voting. At all meetings of the Board of Directors, the
presence of a majority of the number of Directors then in office shall
constitute a quorum for the transaction of business. Every act or decision done
or made by a majority of the directors present at a meeting duly held at which a
quorum is present shall be regarded as the act of the Board of Directors,
subject to the provisions of the California General Corporation Law relating to
approval of contracts or transactions in which a director has a direct or
indirect material financial interest, to appointment of committee, and to
indemnification of directors. A meeting at which a quorum is initially present
may continue to transact business notwithstanding the withdrawal of directors if
any action taken is approved by a least a majority of the required quorum for
that meeting.

Section 10. Action Without a Meeting. Except as otherwise provided under the
1940 Act, any action required or permitted to be taken at any meeting of the
Board of Directors or of any committee thereof may be taken without a meeting if
a written consent to such action is signed by all members of the Board or of
such committee, as the case may be, and such written consent is filed with the
minutes of proceedings of the Board or committee.

Section 11. Compensation of Directors. Directors shall be entitled to receive
such compensation from the Corporation for their services as may from time to
time be determined by resolution of the Board of Directors.

                                   ARTICLE IV

                                   COMMITTEES

Section 1. Organization. By resolution adopted by the Board of Directors, the
Board may designate one or more committees of the Board of Directors, including
an Executive Committee. The Chairmen of such committees shall be elected by the
Board of Directors. Each committee must be comprised of one or more members,
each of whom must be a Director and shall hold committee membership at the
pleasure of the Board. The Board of Directors shall have the power at any time
to change the members of such committees and to fill vacancies in the
committees. The Board may delegate to these committees any of its powers, except
with respect to:

      (a)  the approval of any action which under the California General
      Corporation Law also requires shareholders' approval or approval of the
      outstanding shares;

      (b)  the filling of vacancies on the Board of Directors or in any
      committee;

      (c)  the fixing of compensation of the directors for serving on the Board
      of Directors or on any committee;

      (d)  the amendment or repeal of Bylaws or the adoption of new Bylaws;



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      (e)  the amendment or repeal of any resolution of the Board of Directors
      which by its express terms is not so amendable or repealable;

      (f)  a distribution to the shareholders of the corporation, except at a
      rate or in a periodic amount or within a price range determined by the
      Board of Directors; or

      (g)  the appointment of any other committees of the Board of Directors or
      the members of these committees; or

      (h)  approve or terminate any contract with an "investment adviser" or
           "principal underwriter," as those terms are defined in the 1940 Act;
           or

      (i)  to take any other action required by the 1940 Act to be taken by the
           Board of Directors.

Section 2. Executive Committee. Unless otherwise provided by resolution of the
Board of Directors, when the Board of Directors is not in session, the Executive
Committee, if one is designated by the Board, shall have and may exercise all
powers of the Board of Directors in the management of the business and affairs
of the Corporation that may lawfully be exercised by an Executive Committee. The
President and Chairman shall automatically be members of the Executive
Committee.

Section 3. Proceedings and Quorum. In the absence of an appropriate resolution
of the Board of Directors, each committee may adopt such rules and regulations
governing its proceedings, quorum, and manner of acting as it shall deem proper
and desirable. In the event any member of any committee is absent from any
meeting, the members thereof present at the meeting, whether or not they
constitute a quorum, may appoint a member of the Board of Directors to act in
the place of such absent member.

Section 4. Other Committees. The Board of Directors may appoint other
committees, each consisting of one or more persons, who need not be Directors.
Each such committee shall have such powers and perform such duties as may be
assigned to it from time to time by the Board of Directors, but shall not
exercise any power which may lawfully be exercised only by the Board of
Directors or a committee thereof.

                                    ARTICLE V

                                    OFFICERS

Section 1. General. The officers of the Corporation shall be a President, a
Chief Financial Officer, a Secretary and such other officers, if any, as the
Board of Directors from time to time may in its discretion elect or appoint in
accordance with Section 9 of this Article including without limitation a
Chairman of the Board, one or more Vice Presidents and a Controller. The
corporation may also have such agents, if any, as the Board of Directors from
time to time may in its discretion choose. Any officer may be but none need be a
Director or stockholder. Any two or more offices may be held by the same person.
Any officer may be required by the Board



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of Directors to secure the faithful performance of his duties to the corporation
by giving bond in such amount and with sureties or otherwise as the Board of
Directors may determine.

Section 2. Election, Tenure and Qualifications. The officers of the Corporation,
except those appointed as provided in Section 9 of this Article V, shall be
elected by the Board of Directors at its first meeting or such subsequent
meetings as shall be held prior to its first annual meeting, and thereafter
annually at its annual meeting. If any officers are not elected at any annual
meeting, such officers may be elected at any subsequent regular or special
meeting of the Board. Except as otherwise provided in this Article V, each
officer elected by the Board of Directors shall hold office until the next
annual meeting of the Board of Directors and until his or her successor shall
have been elected and qualified. Any person may hold one or more offices of the
Corporation, except that no one person may serve concurrently as both President
and Vice President. A person who holds more than one office in the Corporation
may not act in more than one capacity to execute, acknowledge, or verify an
instrument required by law to be executed, acknowledged, or verified by more
than one officer. No officer, other than the Chairman or Vice Chairman, need be
a Director.

Section 3. Vacancies and Newly Created Officers. If any vacancy shall occur in
any office by reason of death, resignation, removal, disqualification, or other
cause, or if any new office shall be created, such vacancies or newly created
offices may be filled by the Board of Directors at any regular or special
meeting or, in the case of any office created pursuant to Section 9 hereof, by
any officer upon whom such power shall have been conferred by the Board of
Directors.

Section 4. Removal and Resignation. Any officer may be removed from office by
the vote of a majority of the members of the Board of Directors given at a
regular meeting or any special meeting called for such purpose. Any officer may
resign from office at any time by delivering a written resignation to the Board
of Directors, the President, the Chairman, the Secretary, or any Assistant
Secretary. Unless otherwise specified therein, such resignation shall take
effect upon delivery.

Section 5. Chairman, President and Vice President. The Chairman of the Board, if
any, shall have such duties and powers as shall be designated from time to time
by the Board of Directors. Unless the Board of Directors otherwise specifies,
the Chairman of the Board, or if there is none, the Chief Executive Officer,
shall preside, or designate the person who shall preside, at all meetings of the
shareholders and of the Board of Directors.

Unless the Board of Directors otherwise specifies, the President shall be the
Chief Executive Officer and shall have direct charge of all business operations
of the corporation and, subject to the control of the Directors, shall have
general charge and supervision of the business of the corporation.

Any Vice Presidents shall have such duties and powers as shall be set forth in
these bylaws or as shall be designated from time to time by the Board of
Directors or by the President.

Section 6. Chief Financial Officer and Assistant Chief Financial Officers.
Unless the Board of Directors otherwise specifies, the chief financial officer
shall be the treasurer of the corporation



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and shall be in charge of its funds and valuable papers, and shall have such
other duties and powers as may be designated from time to time by the Board of
Directors or by the President. If no controller is elected, the chief financial
officer shall, unless the Board of Directors otherwise specifies, also have the
duties and powers of the controller.

Any assistant chief financial officers or assistant treasurers shall have such
duties and powers as shall be designated from time to time by the Board of
Directors, the President or the chief financial officer.

Section 7. Controller and Assistant Controller. If a controller is elected, he
shall, unless the Board of Directors otherwise specifies, be the chief
accounting officer of the corporation and be in charge of its books of account
and accounting records, and of its accounting procedures. He shall have such
other duties and powers as may be designated from time to time by the Board of
Directors, the President or the treasurer.

Section 8. Secretary and Assistant Secretaries. The Secretary shall attend to
the giving and serving of all notices of the Corporation and shall record all
proceedings of the meetings of the shareholders and Directors in books to be
kept for that purpose. The Secretary shall keep in safe custody the seal of the
Corporation, and shall have responsibility for the records of the Corporation,
including the stock books and such other books and papers as the Board of
Directors may direct and such books, reports, certificates, and other documents
required by law to be kept, all of which shall at all reasonable times be open
to inspection by any Director. The Secretary shall perform such other duties
which appertain to this office or as may be required by the Board of Directors.

Any Assistant Secretary may perform such duties of the Secretary as the
Secretary or the Board of Directors may assign, and, in the absence of the
Secretary, may perform all the duties of the Secretary.

Section 9. Subordinate Officers. The Board of Directors from time to time may
appoint such other officers and agents as it may deem advisable, each of whom
shall have such title, hold office for such period, have such authority, and
perform such duties as the Board of Directors may determine. The Board of
Directors from time to time may delegate to one or more officers or agents the
power to appoint any such subordinate officers or agents and to prescribe their
respective rights, terms of office, authorities, and duties. Any officer or
agent appointed in accordance with the provisions of this Section 9 may be
removed, either with or without cause, by any officer upon whom such power of
removal shall have been conferred by the Board of Directors.

Section 10. Remuneration. The salaries or other compensation, if any, of the
officers of the Corporation shall be fixed from time to time by resolution of
the Board of Directors in the manner provided by Section 11 of Article III,
except that the Board of Directors may by resolution delegate to any person or
group of persons the power to fix the salaries or other compensation of any
subordinate officers or agents appointed in accordance with the provisions of
Section 9 of this Article V.



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<PAGE>   13

Section 11. Surety Bond. The Board of Directors may require any officer or agent
of the Corporation to execute a bond (including, without limitation, any bond
required by the 1940 Act and the rules and regulations of the Securities and
Exchange Commission promulgated thereunder) to the Corporation in such sum and
with such surety or sureties as the Board of Directors may determine,
conditioned upon the faithful performance of his or her duties to the
Corporation, including responsibility for negligence and for the accounting of
any of the Corporation's property, funds or securities that may come into his or
her hands.

                                   ARTICLE VI

                                 CAPITAL STOCK

Section 1. Certificates of Stock. The interest of each shareholder of the
Corporation may be evidenced by certificates for shares of stock in such form as
the Board of Directors may from time to time authorize; provided, however, the
Board of Directors may, in its discretion, authorize the issuance of
non-certificated shares. No certificate shall be valid unless it is signed by
the Chairman, Vice Chairman, President, or a Vice President and countersigned by
the Secretary or an Assistant Secretary, or the Treasurer or an Assistant
Treasurer of the Corporation and sealed with the seal of the Corporation, or
bears the facsimile signatures of such officers and a facsimile of such seal. In
case any officer who shall have signed any such certificate, or whose facsimile
signature has been placed thereon, shall cease to be such an officer (because of
death, resignation, or otherwise) before such certificate is issued, such
certificate may be issued and delivered by the Corporation with the same effect
as if he or she were such officer at the date of issue.

In the event that the Board of Directors authorizes the issuance of
non-certificated shares of stock, the Board of Directors may, in its discretion
and at any time, discontinue the issuance of share certificates and may, by
written notice to the registered owners of each certificated share, require the
surrender of share certificates to the Corporation for cancellation. Such
surrender and cancellation shall not affect the ownership of shares of the
Corporation.

Section 2. Transfer of Shares. Subject to the provisions of the next sentence of
this Section 2 of Article VI, Shares of the Corporation shall be transferable on
the books of the Corporation by the holder of record thereof in person or by his
or her duly authorized attorney or legal representative (i) upon surrender and
cancellation of any certificate or certificates for the same number of shares of
the same class, duly endorsed or accompanied by proper instruments of assignment
and transfer, with such proof of the authenticity of the signature as the
Corporation or its agents may reasonably require, or (ii) as otherwise
prescribed by the Board of Directors. The Board of Directors may, from time to
time, adopt limitations and rules and regulations with reference to the transfer
of the shares of stock of the Corporation to comply with the requirements of the
Securities Act of 1933, as amended, or other applicable laws. The Corporation
shall be entitled to treat the holder of record of any share of stock as the
absolute owner thereof for all purposes, and accordingly shall not be bound to
recognize any legal, equitable, or other claim or interest in such share on the
part of any other person, whether or not it shall have express or other notice
thereof, except as otherwise expressly provided by law or the statutes of the
State of California.



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<PAGE>   14

Section 3. Stock Ledgers. The stock ledgers of the Corporation, containing the
names and addresses of the shareholders and the number of shares held by them
respectively, shall be kept at the principal offices of the Corporation or, if
the Corporation employs a transfer agent, at the offices of the transfer agent
of the Corporation.

Section 4. Transfer Agents and Registrars. The Board of Directors may from time
to time appoint or remove transfer agents and registrars of transfers for shares
of stock of the Corporation, and it may appoint the same person as both transfer
agent and registrar. Upon any such appointment being made, all certificates
representing shares of capital stock thereafter issued shall be countersigned by
one of such transfer agents or by one of such registrars or by both and shall
not be valid unless so countersigned. If the same person shall be both transfer
agent and registrar, only one countersignature by such person shall be required.

Section 5. Fixing of Record Date. For purposes of determining the shareholders
entitled to notice of any meeting or to vote or entitled to give consent to
corporate action without a meeting, the Board of Directors may fix in advance a
record date which shall not be more than sixty (60) days nor less than ten (10)
days before the date of any such meeting nor more than sixty (60) days before
such action without a meeting and in this event only shareholders of record on
the date so fixed are entitled to notice and to vote or to give consents as the
case may be, notwithstanding any transfer of any shares on the books of the
corporation after the record date, except as otherwise provided in the
California General Corporation Law.

     If the Board of Directors does not so fix a record date:

     (a) The record date for determining shareholders entitled to notice of or
to vote at a meeting of shareholders shall be at the close of business on the
business day next preceding the day on which notice is given or if notice is
waived, at the close of business on the business day next preceding the day on
which the meeting is held.

     (b) The record date for determining shareholders entitled to give consent
to corporate action in writing without a meeting, (i) when no prior action by
the Board of Directors has been taken, shall be the day on which the first
written consent is given, or (ii) when prior action of the Board of Directors
has been taken, shall be at the close of business on the day on which the Board
of Directors adopts the resolution relating to that action or the sixtieth day
before the date of such other action, whichever is later.

Section 6. Lost, Stolen or Destroyed Certificates. Before issuing a new
certificate for stock of the Corporation alleged to have been lost, stolen, or
destroyed, the Board of Directors or any officer authorized by the Board may, in
their discretion, require the owner of the lost, stolen, or destroyed
certificate (or his or her legal representative) to give the Corporation a bond
or other indemnity, in such form and in such amount as the Board or any such
officer may direct and with such surety or sureties as may be satisfactory to
the Board or any such officer, sufficient to indemnify the Corporation against
any claim that may be made against it on account of the alleged loss, theft, or
destruction of any such certificate or the issuance of such new certificate.



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<PAGE>   15

                                   ARTICLE VII

                           FISCAL YEAR AND ACCOUNTANT

Section 1. Fiscal Year.   The fiscal year of the Corporation shall, unless
otherwise ordered by the Board of Directors, be twelve calendar months ending on
the 31st day of December.

Section 2. Accountant.

A. The Corporation shall employ an independent public accountant or a firm of
independent public accountants as its Accountant to examine the accounts of the
Corporation and to sign and certify financial statements filed by the
Corporation. The Accountant's certificates and reports shall be addressed both
to the Board of Directors and to the shareholders. The employment of the
Accountant shall be conditioned upon the right of the Corporation to terminate
the employment forthwith without any penalty by vote of a majority of the
outstanding voting securities at any shareholders' meeting called for that
purpose.

B. A majority of the members of the Board of Directors who are not "interested
persons" (as defined in the 1940 Act) of the Corporation shall select the
Accountant at any meeting held within thirty days before or after the beginning
of the fiscal year of the Corporation or before the annual shareholders' meeting
in that year. The selection shall be submitted for ratification or rejection at
the next succeeding annual shareholders' meeting. If the selection is rejected
at that meeting, the Accountant shall be selected by majority vote of the
Corporation's outstanding voting securities, either at the meeting at which the
rejection occurred, or at a subsequent meeting of shareholders called for the
purpose of selecting an Accountant.

C. Any vacancy occurring between annual meetings due to the resignation of the
Accountant may be filled by the vote of a majority of the members of the Board
of Directors who are not interested persons.

                                  ARTICLE VIII

                             CUSTODY OF SECURITIES

Section 1. Employment of a Custodian. The Corporation shall place and at all
times maintain in the custody of a Custodian (including any sub-custodian for
the Custodian) all funds, securities and similar investments owned by the
Corporation. The Custodian (and any sub-custodian) shall be a bank or trust
company of good standing having an aggregate capital, surplus, and undivided
profits not less than fifty million dollars ($50,000,000) or such other
financial institution or other entity as shall be permitted by rule or order of
the Securities and Exchange Commission. The Custodian shall be appointed from
time to time by the Board of Directors, which shall fix its remuneration.

Section 2. Termination of Custodian Agreement. Upon termination of the agreement
for services with the Custodian or inability of the Custodian to continue to
serve, the Board of



                                       15
<PAGE>   16

Directors shall promptly appoint a successor Custodian, but in the event that no
successor Custodian can be found who has the required qualifications and is
willing to serve, the Board of Directors shall call as promptly as possible a
special meeting of the shareholders to determine whether the Corporation shall
function without a Custodian or shall be liquidated. If so directed by
resolution of the Board of Directors, or by vote of the holders of a majority of
the outstanding shares of stock of the Corporation, the Custodian shall deliver
and pay over all property of the Corporation held by it as specified in such
vote.

Section 3. Other Arrangements. The Corporation may make such other arrangements
for the custody of its assets (including deposit arrangements) as may be
required by any applicable law, rule, or regulation.

                                   ARTICLE IX

                         INDEMNIFICATION AND INSURANCE

Section 1. Agents, Proceedings and Expenses. For the purpose of this Article,
"agent" means any person who is or was a Director, officer, employee or other
agent of this corporation (including any "investment adviser" or "principal
underwriter," as those terms are defined in the 1940 Act) or is or was serving
at the request of this corporation as a Director, officer, employee or agent of
another foreign or domestic corporation, partnership, joint venture, trust or
other enterprise or was a Director, officer, employee or agent of a foreign or
domestic corporation which was a predecessor corporation of this corporation or
of another enterprise at the request of such predecessor corporation;
"proceeding" means any threatened, pending or completed action or proceeding,
whether civil, criminal, administrative or investigative; and "expenses"
includes without limitation attorney's fees and any expenses of establishing a
right to indemnification under this Article.

Section 2. Actions Other Than by Corporation. This corporation shall indemnify
any person who was or is a party or is threatened to be made a party to any
proceeding (other than an action by or in the right of this corporation) by
reason of the fact that such person is or was an agent of this corporation,
against expenses, judgments, fines, settlements and other amounts actually and
reasonably incurred in connection with such proceeding if that person acted in
good faith and in a manner that person reasonably believed to be in the best
interests of this corporation and in the case of a criminal proceeding, had no
reasonable cause to believe the conduct of that person was unlawful. The
termination of any 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 the
person reasonably believed to be in the best interests of this corporation or
that the person had reasonable cause to believe that the person's conduct was
unlawful.

Section 3. Actions by the Corporation. This corporation shall indemnify any
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action by or in the right of this corporation
to procure a judgment in its favor by reason of the fact that that person is or
was an agent of this corporation, against expenses actually and reasonably
incurred by that person in connection with the defense or settlement of that
action if that person acted in



                                       16
<PAGE>   17

good faith, in a manner that person believed to be in the best interests of this
corporation and with such care, including reasonable inquiry, as an ordinarily
prudent person in a like position would use under similar circumstances.

Section 4. Exclusion of Indemnification. Notwithstanding any provision to the
contrary contained herein, there shall be no right to indemnification in
violation of Sections 17(h) and (i) of the 1940 Act or for any liability arising
by reason of willful misfeasance, bad faith, gross negligence, or the reckless
disregard of the duties involved in the conduct of the agent's office with the
corporation.

     No indemnification shall be made under Sections 2 or 3 of this Article:

     (a) In respect of any claim, issue or matter as to which that person shall
have been adjudged to be liable in the performance of that person's duty to this
corporation, unless and only to the extent that the court in which that action
was brought shall determine upon application that in view of all the
circumstances of the case, that person was not liable by reason of the disabling
conduct set forth in the preceding paragraph and is fairly and reasonably
entitled to indemnity for the expenses which the court shall determine; or

     (b) Of amounts paid in settling or otherwise disposing of a threatened or
pending action, with or without court approval, or of expenses incurred in
defending a threatened or pending action which is settled or otherwise disposed
of without court approval, unless the required approval set forth in Section 6
of this Article is obtained.

Section 5. Successful Defense by Agent. To the extent that an agent of this
corporation has been successful on the merits in defense of any proceeding
referred to in Sections 2 or 3 of this Article or in defense of any claim, issue
or matter therein, before the court or other body before whom the proceeding was
brought, the agent shall be indemnified against expenses actually and reasonably
incurred by the agent in connection therewith, provided that the Board of
Directors, including a majority who are disinterested, non-party Directors, also
determines that based upon a review of the facts, the agent was not liable by
reason of the disabling conduct referred to in Section 4 of this Article.

Section 6. Required Approval. Except as provided in Section 5 of this Article,
any indemnification under this Article shall be made by this corporation only if
authorized in the specific case on a determination that indemnification of the
agent is proper in the circumstances because the agent has met the applicable
standard of conduct set forth in Sections 2 or 3 of this Article and is not
prohibited from indemnification because of the disabling conduct set forth in
Section 4 of this Article, by:

     (a) A majority vote of a quorum consisting of Directors who are not parties
to the proceeding and are not interested persons of the corporation as defined
in the Investment Company Act of 1940;

     (b) Approval by the affirmative vote of a majority of the shares of this
corporation entitled to vote represented at a duly held meeting at which a
quorum is present or by the written consent of



                                       17
<PAGE>   18

holders of a majority of the outstanding shares entitled to vote. For this
purpose the shares owned by the person to be indemnified shall not be considered
outstanding or entitled to vote thereon;

     (c) The court in which the proceeding is or was pending, on application
made by this corporation or the agent or the attorney or other person rendering
services in connection with the defense, whether or not such application by the
agent, attorney or other person is opposed by this corporation; or

     (d)  A written opinion by an independent legal counsel.

Section 7. Advance of Expenses. Expenses incurred in defending any proceeding
may be advanced by this corporation before the final disposition of the
proceeding, to the extent permitted by Sections 17(h) and (i) of the 1940 Act,
on receipt of an undertaking by or on behalf of the agent to repay the amount of
the advance unless it shall be determined ultimately that the agent is entitled
to be indemnified as authorized in this Article, provided the agent provides a
security for his undertaking, or a majority of a quorum of the disinterested,
non-party Directors, or an independent legal counsel in a written opinion,
determine that based on a review of readily available facts, there is reason to
believe that said agent ultimately will be found entitled to indemnification.

Section 8. Other Contractual Rights. Nothing contained in this Article shall
affect any right to indemnification to which persons other than Directors and
officers of this corporation or any subsidiary hereof may be entitled by
contract or otherwise.

Section 9. Limitations. No indemnification or advance shall be made under this
Article, except as provided in Section 5 or Section 6(c) in any circumstances
where it appears:

     (a) That it would be inconsistent with a provision of the Articles of
Incorporation, a resolution of the shareholders or an agreement in effect at the
time of accrual of the alleged cause of action asserted in the proceeding in
which the expenses were incurred or other amounts were paid which prohibits or
otherwise limits indemnification; or

     (b) That it would be inconsistent with any condition expressly imposed by a
court in approving a settlement.

Section 10. Insurance. Upon and in the event of a determination by the Board of
Directors of this corporation to purchase such insurance, this corporation shall
purchase and maintain insurance on behalf of any agent of the corporation
against any liability asserted against or incurred by the agent in such capacity
or arising out of the agent's status as such, but only to the extent that this
corporation would have the power to indemnify the agent against that liability
under the provisions of this Article.

Section 11. Amendment. No amendment, alternation, or repeal of this Article or
the adoption, alteration, or amendment of any other provision of the Articles of
Incorporation or Bylaws inconsistent with this Article shall adversely affect
any right or protection of any person under



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<PAGE>   19

this Article with respect to any act or failure to act which occurred prior to
such amendment, alteration, repeal, or adoption.

                                    ARTICLE X

                                   AMENDMENTS

Section 1. General. Except as provided in Section 2 of this Article X, all
Bylaws of the Corporation, whether adopted by the Board of Directors or the
shareholders, shall be subject to amendment, alteration, or repeal, and new
Bylaws may be made by the affirmative vote of a majority of either: (1) the
holders of record of the outstanding shares of stock of the Corporation entitled
to vote, at any annual or special meeting, the notice or waiver of notice of
which shall have specified or summarized the proposed amendment, alteration,
repeal, or new Bylaw; or (2) the Directors, at any regular or special meeting
the notice or waiver of notice of which shall have specified or summarized the
proposed amendment, alteration, repeal, or new Bylaw.

Section 2. By Shareholders Only. No amendment of any section of these Bylaws
shall be made except by the shareholders of the Corporation if the Bylaws
provide that such section may not be amended, altered, or repealed except by the
shareholders. From and after the issue of any shares of the capital stock of the
Corporation, no amendment, alteration, or repeal of this Article X shall be made
except by the affirmative vote of the holders of either: (a) more than
two-thirds of the Corporation's outstanding shares present at a meeting at which
the holders of more than fifty percent (50%) of the outstanding shares are
present in person or by proxy, or (b) more than fifty percent (50%) of the
Corporation's outstanding shares.




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