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<PAGE> PAGE 7
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<PAGE> PAGE 8
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<PAGE> PAGE 11
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<PAGE> PAGE 13
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<PAGE> PAGE 17
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<PAGE> PAGE 18
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<PAGE> PAGE 19
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<PAGE> PAGE 20
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<PAGE> PAGE 21
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<PAGE> PAGE 23
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SIGNATURE DAVID GOLDSTEIN
TITLE SECRETARY
CORE TRUST (DELAWARE)
TRUST INSTRUMENT
AS AMENDED MAY 21, 1999
TABLE OF CONTENTS
Page
ARTICLE I -- THE TRUST
Section 1.1 Name 1
Section 1.2 Definitions 1
ARTICLE II -- TRUSTEES AND OFFICERS
Section 2.1 Number and Qualification 3
Section 2.2 Term and Election 3
Section 2.3 Resignation and Removal 3
Section 2.4 Vacancies 3
Section 2.5 Meetings 3
Section 2.6 Committees 4
Section 2.7 By-Laws 5
Section 2.8 Officers of the Trust 5
Section 2.9 Election,Tenure and Removal
of Officers 5
Section 2.10 Chairman, President and
Vice Presidents 5
Section 2.11 Secretary 6
Section 2.12 Treasurer 6
Section 2.13 Other Officers and Duties 6
ARTICLE III -- POWERS OF TRUSTEES
Section 3.1 General 6
Section 3.2 Investments 6
Section 3.3 Legal Title 7
Section 3.4 Sale of Interests 7
Section 3.5 Borrow Money 7
Section 3.6 Delegation 7
Section 3.7 Collection and Payment 7
Section 3.8 Expenses 7
Section 3.9 Miscellaneous Powers 8
Section 3.10 Further Powers 8
Section 3.11 Principal Transactions 8
ARTICLE IV -- INVESTMENT MANAGEMENT, CUSTODIAL
AND PRIVATE PLACEMENT
ARRANGEMENTS
Section 4.1 Investment Management and
Other Arrangements 8
Section 4.2 Custodial Arrangements 9
Section 4.3 Parties to Contract 9
Section 4.4 Compliance with 1940 Act 9
ARTICLE V -- LIMITATIONS OF LIABILITY
Section 5.1 No Personal Liability of
Trustees, Holders
9
Section 5.2 Indemnification 10
Section 5.3 No Bond Required of
Trustees 11
Section 5.4 No Duty of Investigation;
Notice in Trust
Instruments, etc. 11
Section 5.5 Reliance on Experts, etc. 11
Section 5.6 Holder Offering Documents 12
ARTICLE VI -- INTERESTS OF THE TRUST
Section 6.1 Interests 13
Section 6.2 Rights of Holders 13
Section 6.3 Purchase of or Increase in
Interests 13
Section 6.4 Register of Interests 14
Section 6.5 Non-Transferability 14
Section 6.6 Notices 14
Section 6.7 Assent to Trust Instrument 14
Section 6.8 Establishment of Series 14
Section 6.9 Assets and Liabilities of
Series 14
ARTICLE VII -- DECREASES AND WITHDRAWALS
Section 7.1 Decreases and Withdrawals 15
ARTICLE VIII -- DETERMINATION OF BOOK CAPITAL
ACCOUNT BALANCES,
NET ASSET VALUE,
ALLOCATIONS AND
DISTRIBUTIONS
Section 8.1 Book Capital Acct Balances 15
Section 8.2 Net Asset Value 16
Section 8.3 Allocation of Net Profits
and Net Losses 16
Section 8.4 Distributions 17
Section 8.5 Power to Modify Foregoing
Procedures 17
ARTICLE IX -- HOLDERS
Section 9.1 Meetings of Holders 17
Section 9.2 Notice of Meetings 17
Section 9.3 Record Date for Meetings 17
Section 9.4 Proxies, etc. 18
Section 9.5 Inspectors of Election 18
Section 9.6 Inspection of Records 18
Section 9.7 Holder Action by Written
Consent 18
Section 9.8 Voting Powers 18
ARTICLE X -- DURATION; TERMINATION;
DISSOLUTION; AMENDMENT; MERGERS; ETC.
Section 10.1 Termination of Trust
or any Series 19
Section 10.2 Dissolution 19
Section 10.3 Amendment Procedure 20
Section 10.4 Merger or Consolidation 20
Section 10.5 Incorporation 20
ARTICLE XI -- MISCELLANEOUS
Section 11.1 Governing Law 21
Section 11.2 Counterparts 21
Section 11.3 Reliance by Third Parties 21
Section 11.4 Provisions in Conflict with
Law on Regulations 21
Section 11.5 Signatures 21
Section 11.6 Seal 22
Section 11.7 Fiscal Year 22
Section 11.8 Waivers of Notice 22
Section 11.9 Reports 22
CORE TRUST (DELAWARE)
This TRUST INSTRUMENT of CORE TRUST (DELAWARE)
is restated and amended this 1st day of November,
1994 by the parties signatory hereto, as Trustees.
WHEREAS, having formed a business trust under
the law of Delaware for the investment and
reinvestment of the Trust's assets the Trustees do
desire to amend and restate the Trust Instrument
executed on September 1, 1994; and
WHEREAS, it is proposed that the trust assets
be composed of money and property contributed
hereto by the holders of interests in the trust
entitled to ownership rights in the trust;
NOW, THEREFORE, the Trustees hereby declare
that they will hold in trust all money and property
contributed to the trust fund to manage and dispose
of the same for the benefit of the holders of
interests in the trust and subject to the provisions
hereof, to wit:
ARTICLE I
The Trust
1.1. Name. The name of the trust created hereby
(the "Trust") shall be "Core Trust (Delaware),"
and so far as may be practicable the Trustees shall
conduct the Trust's activities, execute all documents
and sue or be sued under that name, which name (and
the word "Trust" wherever hereinafter used) shall
refer to the Trustees as Trustees, and not individually,
and shall not refer to the officers, agents, employees
or holders of interests in the Trust. However, should
the Trustees determine that the use of the name of
the Trust is not advisable, they may select such other
name for the Trust as they deem proper and the Trust
may hold its property and conduct its activities under
such other name.
1.2. Definitions. As used in this Trust
Instrument, the following terms shall have the
following meanings:
The terms "Affiliated Person," "Assignment"
and "Interested Person" shall have the meanings
given them in the 1940 Act, as modified by any
applicable order or orders of the Commission or
interpretive releases of the Commission thereunder.
"Book Capital Account" shall mean, for any
Holder of Interests in a particular Series at
any time, the Book Capital Account of the Holder
with respect to that Series for such day, deter-
mined in accordance with Article VIII of this
Instrument.
"Code" shall mean the Internal Revenue
Code of 1986, as amended.
"Commission" shall mean the Securities
and Exchange Commission.
"Delaware Act" shall mean Chapter 38
of Title 12 of the Delaware Code entitled
"Treatment of Delaware Business Trusts," as
it may be amended from time to time.
"Fiscal Year" shall mean, with respect
to any Series, an annual period as determined
by the Trustees.
"Holders" shall mean as of any particular
time all holders of record of Interests of a
Series of the Trust at such time.
"Instrument" shall mean this Trust
Instrument as amended from time to time.
References in this Instrument to "Instrument,"
"hereof," "herein" and "hereunder" shall be
deemed to refer to the Instrument rather than
the article or section in which such words
appear.
"Interest(s)" shall mean, with respect
to each Series, the interest of a Holder in
that Series, including all rights, powers and
privileges accorded to such Holders in this
Instrument, which interest may be expressed
as a percentage, determined by calculating,
at such times and on such basis, as the Trustees
shall from time to time determine, the ratio
of each Holder's Book Capital Account balance
to the total of all Holders' Book Capital
Account balances in that Series. Reference
herein to a specified percentage in, or
fraction of, Interests of the Holders in a
Series means Holders whose combined Book
Capital Accounts represent such specified
percentage or fraction of the Book Capital
Accounts of all Holders in that Series.
"Investment Manager" shall mean any
person furnishing services to the Trust or
any Series pursuant to any investment manage-
ment contract as described in Section 4.1
hereof.
"Majority Interests Vote" shall mean,
with respect to the Trust or a Series thereof,
the vote, at a meeting of the Holders of the
Trust or Series, as the case may be, of (i)
67% or more of the Interests present or
represented at such meeting, if the Holders
of more than 50% of the Interests of the
Trust or Series, as the case may be, are
present or represented by proxy or (ii)
more than 50% of the Interests of the Trust
or Series, as the case may be, whichever is
less.
"Net Asset Value" shall have the meaning
assigned to that term in Section 8.2 hereof.
"Person" shall mean and include
individuals, corporations, partnerships, trusts,
associations, joint ventures and other entities,
whether or not legal entities, and governments
and agencies and political subdivisions thereof.
"Registration Statement" shall mean
the Registration Statement of the Trust under
the 1940 Act, as amended from time to time.
"Series" shall mean a series of Interests
of the Trust established in accordance with
the provisions of Article VI, Section 6.8
hereof.
"Trustees" shall mean the signatories
to this Instrument, so long as they shall
continue in office in accordance with the
terms hereof, and all other persons who at
the time in question have been duly elected
or appointed and have qualified as trustees
in accordance with the provisions hereof and
are then in office, who are herein referred
to as the "Trustees," and reference in this
Instrument to a Trustee or Trustees shall
refer to such person or persons in their
capacity as trustees hereunder.
"Trust Property" shall mean as of any
particular time any and all property, real
or personal, tangible or intangible, which
at such time is owned or held by or for the
account of the Trust or any Series, or the
Trustees on behalf of the Trust or any Series.
The "1940 Act" refers to the Investment
Company Act of 1940, as amended from time to
time, and the rules and regulations thereunder.
ARTICLE II
Trustees and Officers
2.1. Number and Qualification. The
number of Trustees shall be fixed from time
to time by the Trustees then in office,
provided, however, that the number of
Trustees shall in no event be less than
three or more than twelve. Any vacancy
created by an increase in Trustees may be
filled by the appointment of an individual
having the qualifications described in this
Article. Any such appointment shall not
become effective, however, until the
individual appointed shall have accepted
such appointment and agreed to be bound by
the terms of this Instrument. No reduction
in the number of Trustees shall have the
effect of removing any Trustee from office.
Whenever a vacancy in the number of Trustees
shall occur, until such vacancy is filled
as provided in Section 2.4 hereof, the
Trustees in office, regardless of their number,
shall have all the powers granted to the
Trustees and shall discharge all the duties
imposed upon the Trustees by this Instrument.
2.2. Term and Election. Each Trustee
named herein, or elected or appointed
hereunder, shall (except in the event of
resignations or removals or vacancies
pursuant to Section 2.3 or 2.4 hereof) hold
office until the Trustee's successor has been
elected and has qualified to serve as Trustee.
Beginning with the Trustees elected at the
first meeting of Holders, each Trustee shall
hold office during the lifetime of this Trust
and until its termination as hereinafter
provided unless such Trustee resigns or
is removed as provided in Section 2.3 below.
2.3. Resignation and Removal. Any
Trustee may resign their trust (without
need for prior or subsequent accounting) by
an instrument in writing signed by him and
delivered or mailed to the Chairman, if any,
the President or the Secretary and such
resignation shall be effective upon such
delivery, or at a later date according to the
terms of the instrument. Any of the Trustees
may be removed by the affirmative vote of the
Holders of two-thirds (2/3) of the Interests
or (provided the aggregate number of Trustees,
after such removal and after giving effect to
any appointment made to fill the vacancy
created by such removal, shall not be less
than the number required by Section 2.1 hereof)
with cause, by the action of two-thirds of the
remaining Trustees. Removal with cause includes,
but is not limited to, the removal of a Trustee
due to physical or mental incapacity. Upon the
resignation or removal of a Trustee, or the
Trustee's otherwise ceasing to be a Trustee,
the Trustee shall execute and deliver such
documents as the remaining Trustees shall
require for the purpose of conveying to the
Trust or the remaining Trustees any Trust
Property held in the name of the resigning or
removed Trustee. Upon the death of any Trustee
or upon removal or resignation due to any
Trustee's incapacity to serve as trustee,
the Trustee's legal representative shall
execute and deliver on the Trustee's behalf
such documents as the remaining Trustees
shall require as provided in the preceding
sentence.
2.4. Vacancies. The term of office
of a Trustee shall terminate and a vacancy
shall occur in the event of the death,
resignation, adjudicated incompetence or
other incapacity to perform the duties of
the office, or removal, of a Trustee or
increase in the number of Trustees. No
such vacancy shall operate to annul this
Instrument or to revoke any existing agency
created pursuant to the terms of this
Instrument. In the case of a vacancy, the
Holders of at least a majority of the
Interests entitled to vote, acting at
any meeting of the Holders held in
accordance with Section 9.1 hereof, or a
majority vote of the Trustees continuing
in office, may fill such vacancy, and any
Trustee so elected by the Trustees or the
Holders shall hold office as provided in
this Instrument.
2.5. Meetings.
(a) Meetings of the Trustees shall
be held from time to time upon the call of
the Chairman, if any, the President, the
Secretary, or any two Trustees. The
Trustees may act with or without a meeting.
A quorum for all meetings of the Trustees
shall be a majority of the Trustees.
Unless provided otherwise in this Instrument,
any action of the Trustees may be taken by
vote of a majority of the Trustees present
(a quorum being present) at a meeting duly
called or by unanimous written consent of the
Trustees without a meeting. In the absence
of a quorum, a majority of the Trustees present
may adjourn the meeting from time to time
until a quorum shall be present. Notice
of an adjourned meeting need not be given.
The Trustees by majority vote may delegate
to any one or more of their number their
authority to approve particular matters or
take particular actions on behalf of
the Trust.
(b) Regular meetings of the Trustees
may be held without call or notice at a time
and place fixed by the Trustees. Notice of
any other meeting shall be given by mail,
facsimile or telegram (which term shall include
a cablegram) or delivered personally,
which shall include by telephone. Notice of a
meeting designating the time, date and place
of such meeting shall be mailed not less
than 72 hours or otherwise given not less
than 24 hours before the meeting but may be
waived in writing by any Trustee either before
or after such meeting. The attendance of a
Trustee at a meeting shall constitute a waiver
of notice of such meeting except where a Trustee
attends a meeting for the express purpose of
objecting, at the commencement of such meeting,
to the transaction of any business on the
ground that the meeting has not been lawfully
called or convened. Neither the business to
be transacted at, nor the purpose of, any
meeting of the Board of Trustees need be
stated in the notice or waiver of notice of
such meeting, and no notice need be given of
action proposed to be taken by unanimous written
consent.
(c) All or any one or more Trustees may
participate in a meeting of the Trustees or
any committee thereof by means of a conference
telephone or similar communications equipment
by means of which all persons participating
in the meeting can hear each other and
participation in a meeting pursuant to such
communications system shall constitute
presence in person at such meeting.
(d) The Chairman, if any, shall act
as chairman at all meetings of the Trustees;
in the Chairman's absence the President shall
act as chairman; and, in the absence of the
Chairman and the President, the Trustees
present shall elect one of their number to
act as temporary chairman. The results of
all actions taken at a meeting of the
Trustees, or by unanimous written consent of
the Trustees, shall be recorded by the Secretary.
(e) With respect to actions of the
Trustees and any committee of the Trustees,
Trustees who are Interested Persons of
the Trust or otherwise interested in any
action to be taken may be counted for quorum
purposes under this Section 2.5, or with respect
to committees, Section 2.6 of this Instrument,
and shall be entitled to vote to the extent
permitted by the 1940 Act.
2.6. Committees.
(a) Any committee of the Trustees may
act with or without a meeting. A quorum for
all meetings of any committee shall be a majority
of the members thereof or such lesser number as
determined by the Trustees. Unless provided
otherwise in this Instrument, any action of any
committee may be taken by a vote of a majority
of the members present (a quorum being present)
at a meeting or by unanimous written consent of
the members without a meeting or by telephone
meeting.
(b) The Trustees by vote of a majority
of all the Trustees may elect from their own
number an Executive Committee to consist of not
less than two (2) to hold office at the pleasure
of the Trustees, which shall have the power to
conduct the current and ordinary business of the
Trust while the Trustees are not in session,
including the purchase and sale of securities
and the designation of securities to be delivered
upon decrease or withdrawal of Interests of the
Trust or any Series, and such other powers of
the Trustees as the Trustees may, from time to
time, delegate to them except those powers
which by law or this Instrument they are
prohibited from delegating. The Trustees may
also elect from their own number other
Committees from time to time, the number
composing such Committees, the powers conferred
upon the same (subject to the same limitations
as with respect to the Executive Committee)
and the term of membership on such Committees
to be determined by the Trustees. The Trustees
may designate a Chairman of any such Committee.
In the absence of such designation, the
Committee may elect its own Chairman. Each
Committee shall keep regular minutes of its
meetings and records of decisions taken without
a meeting and cause them to be recorded in a
book designated for that purpose and kept in
the Office of the Trust.
(c) The Trustees may (1) provide for
stated meetings of any Committee; (2) specify
the manner of calling and notice required
for special meetings of any Committee; (3)
specify the number of members of a Committee
required to constitute a quorum and the
number of members of a Committee required
to exercise specified powers delegated to such
Committee; (4) authorize the making of
decisions to exercise specified powers by
written assent of the requisite number of
members of a Committee without a meeting; and
(5) authorize the members of a Committee to
meet by means of a telephone conference circuit.
2.7. By-Laws. The Trustees may, but
need not, adopt By-Laws for the conduct of the
business of the Trust and may from time to
time amend or repeal any By-Laws.
2.8. Officers of the Trust. The Trustees
shall, from time to time, elect a President, a
Secretary and a Treasurer. The Trustees may
elect or appoint, from time to time, a Chairman
of the Board. The Trustees may elect or appoint
such other officers or assistant officers,
including Vice Presidents, as the business of
the Trust may require. The Trustees may delegate
to any officer or committee the power to appoint
any subordinate officers or agents. Any two or
more of the offices may be held by the same
person, except that the same person may not
be both President and Secretary. The Trustees
may designate a Vice President as an Executive
Vice President and may designate the order in
which the other Vice Presidents may act. The
Chairman and the President shall be Trustees,
but no other officer of the Trust need be a
Trustee. Any officer may be required by the
Trustees to be bonded for the faithful perfor-
mance of the officer's duties in such amount
and with such sureties as the Trustees may
determine.
2.9. Election, Tenure and Removal of
Officers. At the initial organization meeting
and thereafter at each annual meeting of the
Trustees, the Trustees shall elect the Chairman,
if any, President, Secretary, Treasurer. The
Trustees may from time to time elect or appoint
such other officers as the Trustees shall deem
necessary or appropriate in order to carry out
the business of the Trust and such officers
shall hold office until the next annual meeting
of the Trustees and until their successors have
been duly elected and qualified. The Trustees
also may authorize or appoint the President to
appoint such other officers as the
Trustees shall deem necessary or appropriate in
order to carry out the business of the Trust.
The Trustees may fill any vacancy in office or
add any additional officers at any time. Any
officer may be removed at any time, with or
without cause, by action of a majority of the
Trustees. This provision shall not prevent the
making of a contract of employment for a definite
term with any officer and shall have no effect
upon any cause of action which any officer may
have as a result of removal in breach of a
contract of employment. Any officer may resign
at any time by notice in writing signed by such
officer and delivered or mailed to the Chairman,
if any, President, or Secretary, and such
resignation shall take effect immediately, or at
a later date according to the terms of such notice
in writing.
2.10. Chairman, President, and Vice
Presidents. The Chairman, if any, shall, if present,
preside at all meetings of the Holders and of the
Trustees and shall exercise and perform such other
powers and duties as may be from time to time assigned
to him by the Trustees. Subject to such supervisory
powers, if any, as may be given by the Trustees to the
Chairman, if any, the President shall be the chief
executive officer of the Trust and, subject to the
control of the Trustees, shall have general supervision,
direction and control of the business of the Trust
and of its employees and shall exercise such general
powers of management as are usually vested in the office
of President of a corporation. In the absence of the
Chairman, if any, the President shall preside at all
meetings of the Holders and the Trustees. Subject to
direction of the Trustees, the Chairman, if any, and
the President shall each have power in the name and on
behalf of the Trust to execute any and all loan
documents,contracts, agreements, deeds, mortgages,
and other instruments in writing, and to employ
and discharge employees and agents of the Trust.
Unless otherwise directed by the Trustees, the
Chairman, if any, and the President shall each
have full authority and power, on behalf of all
of the Trustees, to attend and to act andto vote,
on behalf of the Trust, at any meetings of business
organizations in which the Trust holds an interest,
or to confer such powers upon any other persons, by
executing any proxies duly authorizing such persons.
The Chairman, if any, and the President shall have
such further authorities and duties as the Trustees
shall from time to time determine. In the absence
or disability of the President, the Vice Presidents
in order of their rank or the Vice President
designated by the Trustees, shall perform all of
the duties of President, and when so acting shall
have all the powers of and be subject to all of the
restrictions upon the President. Subject to the
direction of the President, each Vice President
shall have the power in the name and on behalf of
the Trust to execute any and all loan documents,
contracts, agreements, deeds, mortgages and other
instruments in writing, and, in addition, shall
have such other duties and powers as shall be
designated from time to time by the Trustees or
by the President.
2.11. Secretary. The Secretary shall keep
the minutes of all meetings of, and record all votes
of, Holders, Trustees and the Executive Committee,
if any. The Secretary shall be custodian of the seal
of the Trust, if any, and the Secretary (and any other
person so authorized by the Trustees) shall affix the
seal or, if permitted, a facsimile thereof, to any
instrument executed by the Trust which would be
sealed by a Delaware corporation executing the same
or a similar instrument and shall attest the seal
and the signature or signatures of the officer or
officers executing such instrument on behalf of the
Trust. The Secretary shall also perform any other
duties commonly incident to such office in a Delaware
business corporation, and shall have such other
authorities and duties as the Trustees shall from
time to time determine.
2.12. Treasurer. Except as otherwise
directed by the Trustees, the Treasurer shall have
the general supervision of the monies, funds,
securities, notes receivable and other valuable
papers and documents of the Trust, and shall have
and exercise under the supervision of the Trustees
and of the President all powers and duties normally
incident to the President's office. The Treasurer
may endorse for deposit or collection all notes,
checks and other instruments payable to the Trust
or to its order. The Treasurer shall deposit all
funds of the Trust as may be ordered by the
Trustees or the Treasurer. The Treasurer shall
deliver all funds of the Trust which may come into
the Treasurer's hands to such Custodian as the
Trustees may employ pursuant to Article V of these
By-Laws.
The Treasurer shall keep accurate account of the
books of the Trust's transactions which shall be
the property of the Trust, and which together with
all other property of the Trust in the Treasurer's
possession, shall be subject at all times to the
inspection and control of the Trustees. Unless the
Trustees shall otherwise determine, the Treasurer
shall be the principal accounting officer of the
Trust and shall also be the principal financial
officer of the Trust. The Treasurer shall have such
other duties and authorities as the Trustees or
President shall from time to time determine.
Notwithstanding anything to the contrary herein
contained, the Trustees may authorize any
investment adviser, administrator or manager to
maintain bank accounts and deposit and disburse
funds on behalf of the Trust.
2.13. Other Officers and Duties. The
Trustees may elect such other officers and
assistant officers as they shall from time to
time determine to be necessary or desirable in
order to conduct the business of the Trust.
Assistant officers shall act generally in the
absence of the officer whom they assist and
shall assist that officer in the duties of their
office. Each officer, employee and agent of the
Trust shall have such other duties and authority
as may be conferred upon him by the Trustees or
delegated to him by the President.
ARTICLE III
Powers of Trustees
3.1. General. The Trustees shall have
exclusive and absolute control over the Trust
Property and over the business of the Trust
to the same extent as if the Trustees were the
sole owners of the Trust Property and business
in their own right, but with such powers of
delegation as may be permitted by this Instrument.
The Trustees may perform such acts as in their
sole discretion are proper for conducting the
business of the Trust. The enumeration of any
specific power herein shall not be construed as
limiting the aforesaid power. Such powers of
the Trustees may be exercised without order of
or resort to any court.
3.2. Investments. The Trustees shall have
power to:
(a) Conduct, operate and carry on the
business of an investment company;
(b) Subscribe for, invest in, reinvest in,
purchase or otherwise acquire, hold, pledge, sell,
assign, transfer, exchange, distribute or otherwise
deal in or dispose of any form of property including
United States and foreign currencies and related
instruments including forward contracts, and
securities, including common and preferred stocks,
warrants, bonds, debentures, time notes and all
other evidences of indebtedness, negotiable or non-
negotiable instruments, obligations, certificates
of deposit or indebtedness, commercial paper,
repurchase agreements, reverse repurchase agreements,
convertible securities, forward contracts, options,
futures contracts, and other securities, including,
without limitation, those issued, guaranteed or
sponsored by any state, territory or possession
of the United States and the District of Columbia
and their political subdivisions, agencies and
instrumentalities, or by the United States Government,
any foreign government, or any agency, instrumentality
or political subdivision of the United States Government
or any foreign government, or international
instrumentalities, or by any bank, savings institution,
corporation or other business entity organized under
the laws of the United States or under foreign laws;
and to exercise any and all rights, powers and
privileges of ownership or interest in respect of
any and all such investments of every kind and
description, including, without limitation, the
right to consent and otherwise act with respect
thereto, with power to designate one or more persons,
firms, associations or corporations to exercise any of
said rights, powers and privileges in respect of any
of said instruments; and the Trustees shall be deemed
to have the foregoing powers with the respect to any
additional securities in which the Trustees may
determine to invest.
The Trustees shall not be limited to investing
in obligations maturing before the possible termination
of the Trust, nor shall the Trustees be limited by any
law limiting the investments which may be made by
fiduciaries.
3.3. Legal Title. Legal title to all the Trust
Property shall be vested in the Trustees as joint
tenants except that the Trustees shall have the power
to cause legal title to any Trust Property to be held
by or in the name of one or more of the Trustees, or
in the name of the Trust, or in the name of any other
Person on behalf of the Trust, on such terms as the
Trustees may determine.
The right, title and interest of the Trustees
in the TrustProperty shall vest automatically in each
person who may hereafter become a Trustee upon the
Trustee's due election and qualification. Upon the
resignation, removal or death of a Trustee, the
Trustee shall automatically cease to have any right,
title or interest in any of the Trust Property, and
the right, title and interest of such Trustee in the
Trust Property shall vest automatically in the
remaining Trustees. Such vesting and cessation of
title shall be effective whether or not conveyancing
documents have been executed and delivered.
3.4. Sale of Interests. Subject to the more
detailed provisions set forth in Articles VII and
VIII, the Trustees shall have the power to permit
persons to purchase Interests and to add to or
reduce, in whole or in part, their Interest in the
Trust or any Series thereof.
3.5. Borrow Money. The Trustees shall have
power to borrow money or otherwise obtain credit
and to secure the same by mortgaging, pledging or
otherwise subjecting as security the assets of the
Trust, including the lending of portfolio securities,
and to endorse, guarantee or undertake the performance
of any obligation, contract or engagement of any other
person, firm, association or corporation.
3.6. Delegation. The Trustees shall have power,
consistent with their continuing exclusive authority
over the management of the Trust and the Trust Property,
to delegate from time to time to such of their number
or to officers, employees or agents of the Trust the
doing of such things and the execution of such
instruments either in the name of the Trust or the
names of the Trustees or otherwise as the Trustees
may deem expedient.
3.7. Collection and Payment. The Trustees shall
have power to collect all property due to the Trust;
and to pay all claims, including taxes, against the
Trust Property; to prosecute, defend, compromise or
abandon any claims relating to the 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.
3.8. Expenses. The Trustees shall have power to
incur and pay all expenses which in the opinion of the
Trustees are necessary or incidental to carry out any
of the purposes of this Instrument, and to pay reasonable
compensation from the funds of the Trust or the assets of
the appropriate Series to themselves as Trustees. The
Trustees shall fix the compensation of all officers,
employees and Trustees. The Trustees may pay themselves
such compensation for special services, including legal
and brokerage services, as they in good faith may deem
reasonable, and reimbursement for expenses reasonably
incurred by themselves on behalf of the Trust or any
Series thereof.
3.9. Miscellaneous Powers. The Trustees shall
have the power to: (a) employ or contract with such
Persons as the Trustees may deem desirable for the
transaction of the business of the Trust and terminate
such employees or contractual relationships as they
consider appropriate; (b) enter into joint ventures,
partnerships and any other combinations or associations;
(c) purchase, and pay for out of Trust Property or the
assets of the appropriate Series, insurance policies
insuring the Investment Manager, placement agent,
Holders, Trustees, officers, employees, agents, or
independent contractors of the Trust against all claims
arising by reason of holding any such position or by
reason of any action taken or omitted by any such
Person in such capacity, whether or not the Trust would
have the power to indemnify such Person against such
liability; (d) establish pension, profit-sharing and
other retirement, incentive and benefit plans for any
Trustees, officers, employees and agents of the Trust;
(e) make donations, irrespective of benefit to the
Trust, for charitable, religious, educational,
scientific, civic or similar purposes; (f) to the
extent permitted by law, indemnify any Person with
whom the Trust has dealings, including the Investment
Manager, placement agent, Holders, Trustees, officers,
employees, agents or independent contractors of the
Trust, to such extent as the Trustees shall determine;
(g) guarantee indebtedness or contractual obligations
of others; (h) determine and change the Fiscal Year of
each Series of the Trust and the method in which its
accounts shall be kept; (i) adopt a seal for the Trust,
but the absence of such seal shall not impair the
validity of any instrument executed on behalf of the
Trust; (j) establish separate and distinct Series with
separately defined investment objectives and policies
and distinct investment purposes in accordance with
the provisions of Article VI hereof; (k) subject to
the provisions of Section 3804 of the Delaware Act,
allocate assets, liabilities and expenses of the Trust
to a particular Series or apportion the same between or
among two or more Series, provided that any liabilities
or expenses incurred by a particular Series shall be
payable solely out of the assets belonging to that
Series as provided for in Article VI hereof; (l)
establish, from time to time, a minimum investment
for Holders in the Trust or in one or more Series,
and require the withdrawal of any Holder whose
investment is less than such minimum upon giving
notice to such Holder and; (m) appoint,or authorize
any officer or officers to appoint, one or more
registrars of the Trust.
3.10. Further Powers. 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, whether within or without the
State of Delaware, in any and all states of the United
States of America, in the District of Columbia, and
in any and all commonwealths, territories, dependencies,
colonies, possessions, agencies or instrumentalities
of the United States of America and of foreign
governments, and to do all such other things and execute
all such instruments as they deem necessary, proper or
desirable in order to promote the interests of the Trust
although such things are not herein specifically
mentioned. Any determination as to what is in the
interests of the Trust made by the Trustees in good
faith shall be conclusive.
In construing the provisions of this Instrument,
the presumption shall be in favor of a grant of power
to the Trustees. The Trustees will not be required to
obtain any court order to deal with Trust Property.
3.11. Principal Transactions. The Trustees may,
on behalf of the Trust, buy any securities from or sell
any securities to, or lend any assets of the Trust or any
Series to, any Trustee or officer of the Trust or any firm
of which any such Trustee or officer is a member acting as
principal, or have any such dealings with any investment
manager, placement agent or transfer agent for the Trust
or with any Interested Person of such person; and the
Trust may employ any such person, or firm or company in
which such person is an Interested Person, as broker,
legal counsel, registrar, investment manager, placement
agent, transfer agent, dividend disbursing agent,
custodian or in any other capacity upon customary terms.
ARTICLE IV
Investment Management, Custodial
and Placement Agent Arrangements
4.1. Investment Management and Other Arrangements.
The Trustees may in their discretion, from time to time,
enter into investment management contracts or placement
agent agreements with respect to the Trust or any Series
whereby the other party to such contract or agreement
shall undertake to furnish the Trustees such investment
management, placement agent and/or other services as
the Trustees shall, from time to time, consider desirable
and all upon such terms and conditions as the Trustees
may in their discretion determine. Notwithstanding any
provisions of this Instrument, the Trustees may authorize
any Investment Manager (subject to such general or
specific instruments as the Trustees may, from time to
time, adopt)to effect purchases, sales, loans or
exchanges of Trust Property on behalf of the Trustees
or may authorize any officer, employee or Trustee to
effect such purchases, sales, loans or exchanges pursuant
to recommendations of any such Investment Manager (and
all without further action by the Trustees). Any such
purchases, sales, loans and exchanges shall be deemed
to have been authorized by all of the Trustees.
4.2. Custodial Arrangements.
(a) The Trustees shall at all times employ a bank,
a company that is a member of a national securities
exchange, or a trust company, each having capital,
surplus and undivided profits of at least two million
dollars ($2,000,000) as custodian with authority as the
Trust's agent, but subject to such restrictions,
limitations and other requirements as the Trustees
shall determine (i) to hold the securities owned
by the Trust and deliver the same upon written order
or oral order confirmed in writing; (ii) to receive and
receipt for any monies due to the Trust and deposit the
same in its own banking department or elsewhere as the
Trustees may direct; and (iii) to disburse such funds
upon orders or vouchers.
(b) The Trustees may direct the custodian to deposit
all or any part of the securities owned by the Trust in a
system for the central handling of securities established
by a national securities exchange or a national securities
association registered with the Commission under the
Securities Exchange Act of 1934, as amended, or such other
person as may be permitted by the Commission, or otherwise
in accordance with the 1940 Act, pursuant to which system
all securities of any particular class or series of any
issuer deposited within the system are treated as fungible
and may be transferred or pledged by bookkeeping entry
without physical delivery of such securities, provided
that allsuch deposits shall be subject to withdrawal only
upon the order of the Trust or its custodians,
subcustodians or other agents.
(c) The funds of the Trust shall be deposited in
such depositories as the Trustees shall designate and
shall be drawn out on checks, drafts or other orders
signed by such officer, officers, agent or agents (including
any investment adviser, administrator or manager), as the
Trustees may from time to time authorize.
4.3. Parties to Contract. Any contract may be entered
into with any corporation, firm, trust or association,
although one or more of the Trustees or officers of the
Trust may be an officer, director, trustee, shareholder,
or member of such other party to the contract, and no such
contract shall be invalidated or rendered void or voidable
by reason of the existence of any such relationship, nor
shall any person holding such relationship be disqualified
from voting on or executing the same in the Holder's and/or
Trustee's capacity as Holder and/or Trustee, nor shall any
person holding such relationship be liable merely by reason
of such relationship for any loss or expense to the Trust
under or by reason of said contract or accountable for any
profit realized directly or indirectly therefrom. The same
person (including a firm, corporation, trust, or association)
may be the other party to contracts entered into pursuant to
Sections 4.1 or 4.2 above or otherwise, and any person may be
financially interested or otherwise affiliated with persons
who are parties to any or all of the contracts mentioned in
this Section 4.3.
4.4. Compliance with 1940 Act. Any contract entered
into pursuant to Section 4.1 shall be consistent with and
subject to the requirements of Section 15 of the 1940 Act,
as modified by any applicable order or orders of the
Commission or interpretive releases of the Commission
thereunder, with respect to its continuance in effect,
its termination and the method of authorization and
approval of such contract or renewal thereof.
ARTICLE V
Limitations of Liability
5.1. No Personal Liability of Trustees, Holders.
No Trustee, when acting in such capacity, shall be subject
to any personal liability whatsoever to any Person, other
than the Trust or its Holders, in connection with Trust
Property or the affairs of the Trusts. No Trustee, when
acting in such capacity, shall be subject to any personal
liability whatsoever, provided that nothing contained
herein or in the Delaware Act shall protect any Trustee
against any liability to the Trust or its 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 the
office of Trustees hereunder. No Holder shall be subject
to any personal liability whatsoever to any Person in
connection with Trust Property or the affairs of the Trust.
The Trustees shall have no power to bind any Holder
personally or to call upon any Holder for the payment of
any sum of money or assessment whatsoever other than such
as the Holder may at any time personally agree to pay by
way of purchase of or increase in Interests or otherwise.
5.2. Indemnification.
(a) Subject to the exceptions and limitations
contained in Section (b) below:
(i) Every Person who is, or has been, a Trustee
orofficer of the Trust (hereinafter referred to as a
"Covered Person") shall be indemnified by the Trust to the
fullest extent permitted by law against liability and
against all expenses reasonably incurred or paid by him
in connection with any claim, action, suit or proceeding
in which he becomes involved as a party or otherwise by
virtue of being or having been a Trustee or officer and
against amounts paid or incurred by him in the settlement
thereof;
(ii) The words "claim," "action," "suit," or
"proceeding" shall apply to all claims, actions, suits or
proceedings (civil, criminal or other, including appeals),
actual or threatened while in office or thereafter, and
the words "liability" and "expenses" shall include, without
limitation, attorneys' fees, costs, judgments, amounts paid
in settlement,fines, penalties and other liabilities.
(b) No indemnification shall be provided hereunder
to a Covered Person:
(i) Who shall have been adjudicated by a court
or body before which the proceeding was brought (A) to be
liable to the Trust or its Holders by reason of willful
misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of the
Covered Person's office or (B) not to have acted in good
faith in the reasonable belief that Covered Person's
action was in the best interest of the Trust; or
(ii) In the event of a settlement, unless there
has been a determination that such Trustee or officer did
not engage in willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved
in the conduct of the Trustee's or officer's office,
(A) By the court or other body approving
the settlement;
(B) By at least a majority of those Trustees
who are neither Interested Persons of the Trust nor are
parties to the matter based upon a review of readily
available facts (as opposed to a full trial-type inquiry);
or
(C) By written opinion of independent legal
counsel based upon a review of readily available facts
(as opposed to a full trial-type inquiry);
provided, however, that any Holder may, by
appropriate legal proceedings, challenge any such
determination by the Trustees or by independent counsel.
(c) The rights of indemnification herein provided
may beinsured against by policies maintained by the Trust,
shall be severable, shall not be exclusive of or affect
any other rights to which any Covered Person may now or
hereafter be entitled, shall continue as to a person who
has ceased to be a Covered Person and shall inure to the
benefit of the heirs, executors and administrators of
such a person. Nothing contained herein shallaffect any
rights to indemnification to which Trust personnel, other
than Covered Persons, and other persons may be entitled
by contract or otherwise under law.
(d) Expenses in connection with the preparation
and presentation of a defense to any claim, action, suit
or proceeding of the character described in paragraph
(a) of this Section 5.2 may be paid by the Trust or Series
from time to time prior to final disposition thereof upon
receipt of an undertaking by or on behalf of such Covered
Person that such amount will be paid over by him to the
Trust or Series if it is ultimately determined that he is
not entitled to indemnification under this Section 5.2;
provided, however, that either (a) such Covered Person
shall have provided appropriate security for such
undertaking, (b) the Trust is insured against losses
arising out of any such advance payments or (c) either
a majority of the Trustees who are neither Interested
Persons of the Trust nor parties to the matter, or
independent legal counsel in a written opinion, shall
have determined, based upon a review of readily available
facts (as opposed to a trial-type inquiry or full
investigation), that there is reason to believe that such
Covered Person will be found entitled to indemnification
under this Section 5.2.
(e) Conditional advancing of indemnification monies
under this Section 5.2 for actions based upon the 1940 Act
may be made only on the following conditions: (i) the
advances must be limited to amounts used, or to be used,
for the preparation or presentation of a defense to the
action, including costs connected with the preparation of
a settlement; (ii) advances may be made only upon receipt
of a written promise by, or on behalf of, the recipient to
repay that amount of the advance which exceeds that amount
which it is ultimately determined that he is entitled to
receive from the Trust by reason of indemnification; and
(iii) (a)such promise must be secured by a surety bond,
other suitable insurance or an equivalent form of security
which assures that any repayments may be obtained by the
Trust without delay or litigation, which bond, insurance
or other form of security must be provided by the recipient
of the advance, or (b) a majority of a quorum of the Trust's
disinterested, non-party Trustees, or an independent legal
counsel in a written opinion, shall determine, based upon
a review of readily available facts, that the recipient of
the advance ultimately will be found entitled to
indemnification.
(f) In case any Holder or former Holder of any Series
shall be held to be personally liable solely by reason of
the Holder or former Holder being or having been a Holder
of that Series and not because of the Holder or former
Holder acts or omissions or for some other reason, the
Holder or former Holder (or the Holder or former Holder's
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 assets belonging to the applicable
Series to be held harmless from and indemnified against
all loss and expense arising from such liability. The
Trust, on behalf of the affected Series, shall, upon
request by the Holder, assume the defense of any claim
made against the Holder for any act or obligation of the
Series and satisfy any judgment thereon from the assets
of the Series.
5.3. No Bond Required of Trustees. No Trustee shall,
as such, be obligated to give any bond or surety or other
security for the performance of any of the Trustee's duties
hereunder.
5.4. No Duty of Investigation; Notice in Trust
Instruments, etc. No purchaser, lender, or other person
dealing with the Trustees or any officer, employee or agent
of the Trust shall be bound to make any inquiry concerning
the validity of any transaction purporting to be made by the
Trustees or by said officer, employee or agent or be liable
for the application of money or property paid, loaned, or
delivered to or on the order of the Trustees or of said
officer, employee or agent. Every obligation, contract,
instrument, certificate or other interest or undertaking
of the Trust or any Series, and every other act or thing
whatsoever executed in connection with the Trust or any
Series, shall be conclusively taken to have been executed
or done by the executors thereof only in their capacity
as Trustees, officers, employees or agents of the Trust.
Every written obligation, contract, instrument, certificate
or other interest or undertaking of the Trust or any Series
made or sold by the Trustees or by any officer, employee or
agent of the Trust, in their capacity as such, shall contain
an appropriate recital to the effect that the Trustee, officer,
employee and agent of the Trust shall not personally be bound
by or liable thereunder, nor shall resort be had to their
private property for the satisfaction of any obligation or
claim thereunder, and appropriate references shall be made
therein to the Instrument, and may contain any further
recital which they may deem appropriate, but the omission
of such recital shall not operate to impose personal liability
on any of the Trustees, officers, employees or agents of the
Trust. The Trustees may maintain insurance for the protection
of the Trust Property, its Holders, Trustees, officers,
employees and agents in such amount as the Trustees shall
deem adequate to cover possible tort liability, and such
other insurance as the Trustees in their sole judgment shall
deem advisable.
5.5. Reliance on Experts, etc. Each Trustee and officer
or employee of the Trust shall, in the performance of the
Trustee's, officer's and employee's duties, be fully and
completely justified and protected with regard to any act
or any failure to act resulting from reliance in good faith
upon the books of account or other records of the Trust or
any Series, upon an opinion of counsel, or upon reports made
to the Trust or any Series by any of its officers or
employeesor by any Investment Manager,accountant, appraiser
or other experts or consultants selected with reasonable care
by the Trustees, officers or employees of the Trust,
regardless of whether such counsel or expert may also be a
Trustee.
5.6 Holder Offering Documents. (a) Each Holder of
an Interest shall indemnify and hold harmless the Trust
and each Covered Person against any losses, claims, damages
or liabilities, joint or several, to which the Trust or
such Covered Person may become subject, under the 1933
Act or otherwise, specifically including but not limited
to losses, claims, damages or liabilities related to
negligence on the part of the Trust or any Covered Person,
insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based
upon any Misstatement in a Holder Statement; and each
Holder further agrees to reimburse the Trust and each
Covered Person for any legal or other expenses reasonably
incurred by it in connection with investigating or
defending any such loss, claim, damage, liability or
action; provided, however that the Holder of an Interest
shall not be liable in any such case to the extent that
any such loss, claim, damage or liability arises out of
or is based upon any Misstatement made in such Holder
Statement in reliance upon and in conformity with written
information furnished to such Holder by the Trust or such
Covered Person for use in the preparation thereof. The
foregoing proviso shall not apply to exculpate a Holder
under this Section 5.6(a) with respect to any losses,
claims, damages or liabilities to which the Trust or any
such Covered Person may become subject, insofar as such
losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any
Misstatement in any Holder Statement or portion thereof
of such Holder, if such Misstatement only relates to
(i) any investment company or series thereof that
does not and does not propose, as of the time the
Misstatement is made, to invest all or a portion of its
assets in a Series of the Trust or (ii) to an offering
of securities (as defined under the 1933 Act) of such
Holder or its affiliates the proceeds from which are not
and are not proposed, as of the time the Misstatement is
made, to be invested in a Series of the Trust.
The indemnity provisions of this Section 5.6(a)
shall inure to the benefit of each person, if any, who
controls the Trust or any Covered Person within the
meaning of the 1933 Act.
(b) The Trust shall indemnify and hold harmless
each Holder against any losses, claims, damages or
liabilities, joint or several, to which such Holder
may become subject under the 1933 Act or otherwise,
specifically including but not limited to losses,
claims, damages or liabilities (or actions in respect
thereof) that arise out of or are based upon any
Misstatement in the Holder Statement of such Holder,
in each case to the extent, but only to the extent,
that such Misstatement was made in reliance upon and
in conformity with written information furnished to
such Holder by the Trust for inclusion therein, and
will reimburse such Holder for any legal or other
expenses reasonably incurred by such Holder in
connection with investigating ordefending any such
loss, claim, damage, liability or action.
This indemnity provision in this Section 5.6
(b) shall extend upon the same terms and conditions
to, and shall inure to the benefit of, each officer
and director of each Holder and each person, if any,
who controls such Holder within the meaning of the
1933 Act.
(c) Promptly after receipt by an indemnified
party under this Section 5.6 of notice of the
commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made
against the indemnifying party under Section 5.6(a)
or 5.6(b), notify the indemnifying party in writing
of the commencement thereof, but the omission so to
notify the indemnifying party will not relieve it
from any liability which it may have to any
indemnified party otherwise than under Section 5.6(a)
or 5.6(b). In case any such action is brought against
any indemnified party, and it notified the indemnifying
party of the commencement thereof, the indemnifying
party will be entitled to participate therein, and to
the extent that it may elect by written notice
delivered to the indemnified party promptly after
receiving the aforesaid notice from such indemnified
party, to assume the defense thereof, with counsel
reasonably satisfactory to such indemnified party;
provided, however, that if the defendants in any such
action include both the indemnified parties and the
indemnifying party and the indemnified party shall
have reasonably concluded that there are legal
defenses available to it and/or other indemnified
parties that are different from or additional to
those available to the indemnifying party and that
as a result thereof, the indemnified party shall
reasonably conclude that it is inadvisable for it
to be represented by counsel for the indemnifying
party, the indemnified party or parties shall have
the right to select separate counsel to assume such
legal defenses and to otherwise participate in the
defense of such action on behalf of such indemnified
party or parties. Upon receipt of notice from the
indemnifying party to such indemnified party of the
indemnifying party's election so to assume the
defense of such action and approval by the indemnified
party of counsel (or the unreasonable withholding
of such approval), the indemnifying party will not
be liable to such indemnified party under Section 5.6(a)
or 5.6(b) for any legal or other expenses subsequently
incurred by such indemnified party in connection with
the defense thereof unless (i) the indemnified party
shall have employed separate counsel in accordance with
the proviso to the immediately preceding sentence (it
being understood, however, that the indemnifying party
shall not be liable for the expenses of more than one
separate counsel approved by the indemnifying party,
representing all the indemnified parties under Section
5.6(a) or 5.6(b) hereof who are parties to such action),
(ii) the indemnifying party shall not have employed
counsel reasonably satisfactory to the indemnified
party to represent the indemnified party within a
reasonable time after notice of commencement of the
action, or (iii) the indemnifying party has authorized
the employment of counsel for the indemnified party at
the expense of the indemnifying party. In no event
shall any indemnifying party be liable in respect of
any amounts paid in settlement of any action unless
the indemnifying party shall approved the terms of
such settlement; provided, however, that such consent
shall not be unreasonably withheld or delayed.
(d) For purposes of this Section 5.6, the following
terms shall have the following meanings:
"Holder Statement" shall mean any registration
statement or prospectus, as such terms are defined
under the 1933 Act, or any other material or information,
written or oral, distributed or communicated to
shareholders or partners, or prospective shareholders
or partners, of a Holder by or at the direction of such
Holder, including, without limitation, proxies and
proxy statements, as such terms are defined under the
1940 Act and the Securities Exchange Act of 1934, as
amended.
"Misstatement" shall mean, with respect to any
Holder Statement, any untrue statement or alleged untrue
statement of any material fact, or any omission or alleged
omission to state a material fact required to be stated
therein or necessary to make the statements therein,
in light of the circumstances in which they were made,
not misleading.
"1933 Act" shall mean the Securities Act of 1933,
as amended, and the rules and regulations thereunder.
"1940 Act" shall mean the Investment Company Act of
1940, as amended, and the rules and regulations thereunder.
(e) The provisions of this Section 5.6 shall apply
to each Holder effective on the date such Holder becomes
a shareholder of the Trust and shall survive after such
Holder no longer holds an interest in the Trust.
(f) Notwithstanding anything else herein, no
amendment to Section 5.6 shall be effective until at
least 30 days after the Trust has delivered all Holders
(as of the date of such notice)
written notice of such amendment.
ARTICLE VI
Interests of the Trust
6.1. Interests. The beneficial interest in the
property of the Trust shall be divided into Interests
of one or more separate and distinct Series as the
Trustees shall from time to time create and establish.
The Trustees may permit the purchase of Interests in
any Series by any number of Persons. Subject to
applicable law and to such restrictions as may be
adopted by the Trustees, a Holder may increase or
decrease its Interest in any Series without
limitation.
6.2. Rights of Holders. The ownership of the
Trust property of every description and the right to
conduct any business hereinbefore described are vested
exclusively in the Trustees, and the Holders shall have
no right or title therein other than the beneficial
interest conferred by their Interests and they shall
have no right to call for any partition or division of
any property, profits or rights of the Trust. The
Interests shall be personal property giving only the
rights specifically set forth in this Instrument.
6.3. Purchase of or Increase in Interests. The Trustees,
in their discretion, may, from time to time, without a
vote of the Holders, permit the purchase of Interests
of any Series by such party orparties (or increase in
the Interest of a Holder in any Series) and for such
type of consideration, including cash or property, at
such time or times (including, without limitation, each
business day), and on such terms as the Trustees may
deem best, and may in such manner acquire other assets
(including the acquisition of assets subject to, and in
connection with the assumption of, liabilities) and
businesses; provided, however, that the Trustees may
not permit the purchase of Interests of any Series if
any Series would have more than 500 Holders. The
Trustees may make such additional rules and regulations,
not inconsistent with this Instrument, as they may deem
expedient concerning the purchase or increase of Interests.
6.4. Register of Interests. A register shall be
kept at the principal office of the Trust under the
direction of the Trustees which shall contain the names
and addresses of the Holders of each Series and the Book
Capital Account balances of each Holder of each Series.
Each such register shall be conclusive as to who are
the Holders of each Series of the Trust and who shall
be entitled to payments of distributions or otherwise to
exercise or enjoy the rights of Holders. No Holder shall
be entitled to receive payment of any distribution, or to
have notice given to it as herein provided, until it has
given its address to such officer or agent of the Trustees
as shall keep the said register for entry thereon.
6.5. Non-Transferability. Interests of a Series
shall not be transferable, unless the prospective
transferor obtains the prior unanimous consent of the
Holders of that Series to the transfer. Except as
otherwise provided by law, the Trust shall be entitled
to recognize the exclusive right of a person in whose
name any Interest stands on the record of Holders as
the holder of such Interest for all purposes, including,
without limitation, the rights to receive distributions,
and to vote as such holder, and the Trust shall not be
bound to recognize any equitable or legal claim to or
interest in any such Interest on the part of any other
person.
6.6. Notices. Any and all notices to which any
Holder hereunder may be entitled and any and all
communications shall be deemed duly served or given
if mailed, postage prepaid, addressed to any Holder
of record at its last known address as recorded on
the register of the Trust.
6.7. Assent to Trust Instrument. Every Holder,
by virtue of having become a Holder, shall be held to
have expressly assented and agreed to the terms hereof
and to have become a party hereto.
6.8. Establishment of Series. The Trust created
hereby shall consist of one or more Series and separate
and distinct records shall be maintained by the Trust
for each Series and the assets associated with any such
Series shall be held and accounted for separately from
the assets of the Trust or any other Series. The
Trustees shall have full power and authority, in their
sole discretion, and without obtaining any prior
authorization or vote of the Holders of any Series of
the Trust, to establish and designate and to change in
any manner any such Series of Interests and to fix such
preferences, voting powers, right and privileges of such
Series as the Trustees may from time to time determine,
to classify or reclassify any unissued Interests or any
Series into one or more Series, and to take such other
action with respect to the Interests as the Trustees may
deem desirable.
The establishment and designation of any Series shall be
effective upon the adoption of a resolution by a majority
of the Trustees setting forth such establishment and
designation and the relative rights and preferences of
the Interests of such Series. At any time that there
are no Interests outstanding of any particular Series
previously established and designated, the Trustees may
by a majority vote abolish that Series and the
establishment and designation thereof.
All references to Interests in this Trust Instrument
shall be deemed to be Interests of any or all Series, as
the context may require. All provisions herein relating
to the Trust shall apply equally to each Series of the
Trust, except as the context otherwise requires.
6.9. Assets and Liabilities of Series. All
consideration received by the Trust for the issuance or
sale of Interests 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 from any reinvestment of such
proceeds in whatever form the same may be, shall be
held and accounted for separately from the other assets
of the Trust and of every other Series and may be
referred to herein as "assets belonging to" that Series.
The assets belonging to a particular Series shall belong
to that Series for all purposes, and to no other Series,
subject only to the rights of creditors of that Series.
In addition, any assets, income, earnings, profits or
funds, or payments and proceeds with respect thereto,
which are not readily identifiable as belonging to any
particular Series shall be allocated by the Trustees
between and among one or more of the Series in such
manner as the Trustees, in their sole discretion, deem
fair and equitable. Each such allocation shall be
conclusive and binding upon the Holders of all Series
for all purposes, and such assets, income, earnings,
profits or funds, or payments and proceeds with respect
thereto shall be assets belonging to that Series. The
assets belonging to a particular Series shall be so
recorded upon the books of the Trust, and shall be held
by the Trustees in trust for the benefit of the Holders
of Interests of that Series. The assets belonging to
each particular Series shall be charged with the
liabilities of that Series and all expenses, costs,
charges and reserves attributable to that Series. Any
general liabilities, expenses, costs, charges or reserves
of the Trust which are not readily identifiable as
belonging to any particular Series shall be allocated
and charged by the Trustees between or among any one
or more of the Series in such manner as the Trustees
in their sole discretion deem fair and equitable.
Each such allocation shall be conclusive and binding
upon the Holders of all Series for all purposes.
Without limitation of the foregoing provisions of this
Section 6.9, but subject to the right of the Trustees
in their discretion to allocate general liabilities,
expenses, costs, changes or reserves as herein provided,
the debts, liabilities, obligations and expenses incurred,
contracted for or otherwise existing with respect to a
particular Series shall be enforceable against assets
of such Series only, and not against the assets of the
Trust generally. Notice of this contractual limitation
on inter-Series liabilities may, in the Trustee's sole
discretion, be set forth in the certificate of trust of
the Trust (whether originally or by amendment) as filed
or to be filed in the Office of the Secretary of State
of the State of Delaware pursuant to the Delaware Act,
and upon the giving of such notice in the certificate
of trust, the statutory provisions of Section 3804 of
the Delaware Act relating to limitations on inter-Series
liabilities (and the statutory effect under Section 3804
of the Delaware Act setting forth such notice in the
certificate of trust) shall become applicable to the
Trust and each Series. Any person extending credit to,
contracting with or having any claim against any Series
may look only to the assets of that Series to satisfy
or enforce any debt with respect to that Series. No
Holder or former Holder of any Series shall have a claim
on or any right to any assets allocated or belonging to
any other Series.
ARTICLE VII
Decreases and Withdrawals
7.1. Decreases and Withdrawals. A Holder shall
have the authority to decrease or withdraw its Interest
in any Series of the Trust, at such Holder's option,
subject to the terms and conditions provided in this
Article VII. The Trust shall, upon application of any
Holder or pursuant to authorization from any Holder,
and subject to this Article VII, decrease or withdraw
such Holder's Interest for an amount (which shall be
treated as a distribution for purposes of Section 8.1)
determined by the application of a formula adopted for
such purpose by resolution of the Trustees; provided
that (a) such amount shall not exceed the positive
balance in such Holder's Book Capital Account
(determined after taking into account such adjustments
as are required by Treasury Department Regulation
1.704-1(b) (2) (ii) (b) (2) but before reduction
thereof to reflect the distribution of such amount)
and (b) if so authorized by the Trustees, the Trust
may, at any time and from time to time, charge fees
for effecting such decrease or withdrawal, at such
rates as the Trustees may establish, and may, at
any time and from time to time, suspend such right
of decrease or withdrawal. The procedures for
effecting decreases or withdrawals shall be as
determined by the Trustees from time to time.
ARTICLE VIII
Determination of Book Capital Account
Balances, Net Asset Value, Allocations and
Distributions
8.1. Book Capital Account Balances. A Book
Capital Account shall be maintained for each Holder
of each Series. With respect to each Series, each
Book Capital Account shall be credited with the
amounts of consideration paid by the Holder to
purchase or increase its Interest in the Series
and with its share of the Series' Net Profits
(defined below), shall be charged with such Holder's
share of the Series' Net Losses (defined below),
distributions and withholding taxes (if any) and
shall otherwise appropriately reflect transactions
of the Series and the Holders.No interest shall be
paid on any amount of consideration paid to the
Trust to purchase or increase Interests.
"Net Profits" of a Series for any given time
period shall mean the excess of the Net Asset Value
of the Series (defined in Section 8.2) at the close
of business on the last day of the period, prior to
any distribution being made with respect to such
period, over the Net Asset Value of the Series as
of the opening of business on the first day of such
period, after any additional contributions made on
such date.
"Net Losses" of a Series for any given time
period shall mean the excess of the Net Asset Value
of the Series as of the opening of business on the
first day of the period, after any additional
contributions made on such date, over the Net Asset
Value of the Series at the close of business on the
last day of such period, prior to any distribution
being made with respect to such period.
The Book Capital Account balances of Holders
of each Series shall be determined periodically at
such time or times as the Trustees may determine.
The power and duty to make calculations necessary
to determine these balances may be delegated by the
Trustees to the Investment Manager, custodian, or
such other person as the Trustees may determine.
Notwithstanding anything herein to the contrary,
the Book Capital Accounts and any related accounts
(including without limitation tax capital accounts,
gross appreciation [unrealized gain] accounts, and
gross depreciation [unrealized loss] accounts) of the
Holders and of any series shall at all times during
the full term of such Series be determined and
maintained in accordance with the rules of Treasury
Department Regulation 1.704-1 (b) (2) (iv). The
Trustees are authorized to prescribe, in their
absolute discretion, such policies for the
establishment and maintenance of such accounts
("Policies") as they, in consultation with the
Trust's professional advisers, consider to be in
accordance with the requirements of such rules.
8.2. Net Asset Value. The term "Net Asset Value"
shall mean, with respect to any Series, that amount
by which the assets of the Series exceed its liabilities,
all as determined by or under the direction of the
Trustees. In making this determination, the Trustees,
without Holder approval, may alter the method of valuing
portfolio securities insofar as permitted under the 1940
Act and the rules, regulations and interpretations thereof
promulgated or issued by the Commission or insofar as
permitted by any order of the Commission applicable to
the Series. The Trustees may delegate any of their
powers and duties under this Section 8.2 with respect
to valuation of assets and liabilities.
8.3. Allocation of Net Profits and Net Losses.
(a) Net Profits and Net Losses of each Series shall
be determined and allocated daily as of the close of
business to and among the Holders of that Series in
proportion to their respective Interests in the Series,
determined as of the opening of business on such day.
(b) Except as otherwise provided in this Section
8.3, for each fiscal year, items of income, deduction,
gain, loss or credit that are recognized by a Series for
tax purposes shall be allocated pursuant to Treasury
Department Regulations 1.704-1(b) in such manner as
to equitably reflect amounts credited or debited to the
Book Capital Account of each Holder of that Series for
such year. Allocations of such items also shall be made,
where appropriate, in accordance with section 704(c) of
the Code and the regulations thereunder, as may be
provided in any Policies adopted by the Trustees
pursuant to Section 8.1.
(c) Expenses of a Series, if any, which are borne
by any Holder of that Series in its individual capacity
shall be specially allocated to that Holder.
(d) Notwithstanding anything in Section 8.3(b) or
(c) to the contrary, in the event any Holder of a Series
unexpectedly receives any adjustments, allocations or
distributions described in Treasury Department Regulations
1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5) or
1.704-1(b)(2)(ii)(d)(6), items of income (including gross
income) and gain of that Series shall be specially
allocated to such Holder in an amount and manner
sufficient to eliminate the deficit balance in the
Holder's Book Capital Account (as determined in
accordance with Treasury Department Regulation
1.704-1 (b)(2)(ii)(d)) created by such adjustments,
allocations or distributions as quickly as possible.
Any special allocations of income and gain of a Series
pursuant to this Section 8.3(d) shall be taken into
account in computing subsequent allocations of income
and gain of that Series pursuant to this Article VIII,
so that the net amount of any items of that Series so
allocated and the income, gain, loss, deduction and
all other items of that Series allocated to each Holder
pursuant to this Article VIII shall, to the extent
possible, equal the net amount that would have been
allocated to each such Holder pursuant to the
provisions of this Article VIII if such special
allocations had not been made.
8.4. Distributions. The Trustees may from time
to time agree to the payment of distributions to Holders
of a Series. The amount of such distributions and the
payment of them and whether they are in cash or in any
other assets of the Series shall be wholly in the
discretion of the Trustees.
8.5. Power to Modify Foregoing Procedures.
Notwithstanding any of the foregoing provisions of
this Article VIII, the Trustees may prescribe,
in their absolute discretion, such other bases and
times for determining, for financial reporting and/or
tax accounting purposes, (a) the Net Profits, Net
Losses, taxable income, tax loss, and/or net assets of
any Series (or, where appropriate in the Trustees'
judgment, of the Trust as a whole), and/or (b) the
allocation of the Net profits or Net Losses and taxable
income or tax loss so determined among, or the payment
of distributions to, the Holders of any Series as they
deem necessary or desirable to enable the Trust or any
Series to comply with any provision of the 1940 Act,
the Code, any rule or regulation thereunder, or any
order of exemption issued by the Commission, all as
in effect now or as hereafter amended or modified.
ARTICLE IX
Holders
9.1. Meetings of Holders. Meetings of the
Holders of any Series may be called at any time by a
majority of the Trustees and shall be called by any
Trustee upon written request of Holders holding, in
the aggregate, not less than 10% of the Interests of
that Series, such request specifying the purpose or
purposes for which such meeting is to be called. Any
such meeting shall be held within or without the State
of Delaware on such day and at such time as the
Trustees shall designate. Holders of one-third of the
Interests entitled to vote, present in person or by
proxy, shall constitute a quorum for the transaction
of any business, except as may otherwise be required
by law or by this Instrument. The Chairman, if any,
shall act as chairman at all meetings of the
Holders; in the Chairman's absence, the President
shall act aschairman; and in the absence of the
Chairman and the President, the Trustee or Trustees
present at each meeting may elect a temporary chairman
for the meeting, who may be one of themselves. Holders
may vote either in person or by duly executed proxy and
each Holder shall be entitled to vote proportionate to
the Holder's Interest in the Trust or affected Series.
If a quorum is present at a meeting, an affirmative vote
of a majority of interest of the Holders present and
entitled to vote thereon, either in person or by proxy,
at such meeting constitutes the action of the Holders,
unless law or this Instrument requires a greater number
of affirmative votes.
9.2. Notice of Meetings. Notice of all meetings
of the Holders of any Series, stating the time, place
and purposes of the meeting, shall be given by the
Trustees by mail to each Holder of that Series, at the
Holder's registered address, mailed at least 10 days and
not more than 90 days before the meeting. At any such
meeting, any business properly before the meeting may
be considered whether or not stated in the notice of
the meeting. Any adjourned meeting may be held as
adjourned without further notice. No notice need be
given to any Holder who shall have failed to inform
the Trust of the Holder's current address or if a
written waiver of notice, executed before or after
the meeting by the Holder or the Holder's attorney
thereunto authorized, is filed with the records of
the meeting.
9.3. Record Date for Meetings. For the purpose
of determining the Holders who are entitled to notice
of and to vote at any meeting, including any adjournment
thereof, or to participate in any distribution, or for
the purpose of any other action, the Trustees may from
time to time fix a date, not more than 90 days prior
to the date of any meeting of the Holders or payment
of distributions or other action, as the case may be,
as a record date for the determination of the Persons
to be treated as Holders of record for such purposes.
If the Trustees do not, prior to any meeting of Holders,
so fix a record date, then the date of mailing notice
of the meeting shall be the record date.
9.4. Proxies, etc. At any meeting of Holders,
any Holder entitled to vote thereat may vote by proxy,
provided that no proxy shall be voted at any meeting
unless it shall have been placed on file with the
Secretary, or with such other officer or agent of
the Trust as the Secretary may direct, for
verification prior to the time at which such vote
shall be taken. A proxy may be given in writing,
by any electronic or telecommunications device or
in any other manner. Pursuant to a resolution of a
majority of the Trustees, proxies may be solicited
in the name of one or more Trustees or one or more
of the officers of the Trust. Only Holders of
record shall be entitled to vote. Each Holder
shall be entitled to a vote proportionate to its
Interest in the Trust or applicable Series, as the
case may be. When Interests are held jointly by
several persons, any one of them may vote at any
meeting in person or by proxy in respect of such
Interest, but if more than one of them shall be
present at such meeting in person or by proxy,
and such joint owners or their proxies so present
disagree as to any vote to be cast, such vote shall
not bereceived in respect of such Interest. A proxy
purporting to be executed by or on behalf of a Holder
shall be deemed valid unless challenged at or prior to
its exercise, and the burden of proving invalidity
shall rest on the challenger. If the Holder is a minor
or a person of unsound mind, and subject to guardianship
or to the legal control of any other person as regards
the charge or management of its Interest, the Holder
may vote by the Holder's guardian or such other person
appointed or having such control, and such vote may be
given in person or by proxy. No proxy shall be valid
after eleven (11) months from the date of its execution,
unless a longer period is expressly stated in such proxy.
9.5. Inspectors of Election. In advance of any
meeting of Holders, the Trustees may appoint Inspectors
of Election to act atthe meeting or any adjournment
thereof. If Inspectors of Election are not so appointed,
the Chairman, if any, of any meeting of Holders may, and
on the request of any Holder or the Holder's proxy shall,
appoint Inspectors of Election of the meeting. The number
of Inspectors shall be either one or three. If appointed
at the meeting on the request of one or more Holders or
proxies, a majority of the Interests present shall
determine whether one or three Inspectors are to be
appointed, but failure to allow such determination by
the Holders shall not affect the validity of the
appointment of Inspectors of Election. In case any
person appointed as Inspector fails to appear or fails
or refuses to act, the vacancy may be filled by
appointment made by the Trustees in advance of the
convening of the meeting or at the meeting by the person
acting as Chairman. The Inspectors of Election shall
determine the percentage of the total Interests
represented at themeeting, the existence of a quorum,
the authenticity, validity and effect of proxies, shall
receive votes, ballots or consents, shall hear and
determine all challenges and questions in any way arising
in connection with the right to vote, shall count and
tabulate all votes or consents, determine the results,
and do such other acts as may be proper to conduct the
election or vote with fairness to all Holders. If there
are three Inspectors of Election, the decision, act or
certificate of a majority is effective in all respects
as the decision, act or certificate of all. On request
of the Chairman, if any, of the meeting, or of any
Holder or a Holder's proxy, the Inspectors of Election
shall make a report inwriting of any challenge or
question or matter determined by them and shall execute
a certificate of any facts found by them.
9.6. Inspection of Records. The records of the Trust
shall be open to inspection by Holders during normal
business hours for any purpose not harmful to the Trust.
At each meeting of the Holders of the Trust or any Series
there shall be open for inspection the minutes of the last
previous meeting of Holders of the Trust or Series, as the
case may be, and a list of the Holders of the Trust or Series,
certified to be true and correct by the Secretary or other
proper agent of the Trust, as of the record date of the meeting.
Such list of Holders shall contain the name of each Holder
and the address and the percentage of the total Interests
owned by such Holder.
9.7. Holder Action by Written Consent. Any action
which may be taken by Holders may be taken without a meeting
if Holders shall unanimously consent to the action in writing
and the written consents are filed with the records of the
meetings of Holders. Such consent shall be treated for all
purposes as a vote taken at a meeting of Holders.
9.8. Voting Powers. The Holders shall have power to
vote only (i) for the election of Trustees as provided in
Sections 2.2 and 2.4; (ii) for the removal of Trustees as
provided in Section 2.3; (iii) with respect to any
investment management contract entered into pursuant to
Section 4.1; (iv) with respect to termination of the Trust
as provided in Section 10.1; and (v) with respect to any
such additional matters relating to the Trust as may be
required by this Instrument or any registration of the Trust
as an investment company under the 1940 Act with the
Commission (or any successor agency) or as the Trustees may
consider necessary or desirable. On any matter submitted to
a vote of the Holders, all Interests shall be voted
separately by individual Series, except (i) when required
by the 1940 Act, Interests shall be voted in the aggregate
and not by individual Series; and (ii) when the Trustees
have determined that the matter affects the interests of
more than one Series, then the Holders of all such Series
shall be entitled to vote thereon. There shall be no
cumulative voting in the election of Trustees. Until
Interests are issued and at any time wherein no Interests
are outstanding, the Trustees may exercise all rights of
Holders and may take any action required by law or this
Instrument to be taken by Holders.
ARTICLE X
Duration; Termination; Dissolution;
Amendment; Mergers; Etc.
10.1. Termination of Trust or any Series.
(a) The Trust or any Series may be terminated by
(i) a Majority Interests Vote of each Series affected by
the matter or, if applicable, a Majority Interests vote
of the Trust, or (ii) the Trustees by written notice to
the Holders. Upon any such termination,
(i) The Trust or any affected Series 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 or any affected Series and all
of the powers of the Trustees under this Instrument with
respect to the Trust or any affected Series shall continue
until the affairs of the Trust or any such Series shall
have been wound up, including the power to fulfill or
discharge the contracts of the Trust or any such Series,
collect its assets, sell, convey, assign, exchange, or
otherwise dispose of all or any part of the remaining
assets of the Trust or any such Series 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
shall distribute the remaining assets of the Trust or
any affected Series, in cash or in kind or partly each,
among the Holders of the Trust or the affected Series
in proportion to their respective Interests in the Trust
or Series (that is, in accordance with the positive Book
Capital Account balances of the Holders), after taking
into account such adjustments as are required by Treasury
Department Regulation 1.704-1(b) (2) (ii) (b) (2).
(b) Upon termination of the Trust or any Series and
distribution to the Holders as herein provided, a majority
of the Trustees shall execute and lodge among the records
of the Trust an instrument in writing setting forth the
fact of such termination. Upon termination of the Trust
or any Series, the Trustees shall thereupon be discharged
from all further liabilities and duties hereunder with
respect to the Trust or Series, and the rights and interests
of all Holders of the Trust or Series shall thereupon cease.
10.2. Dissolution. Any Series shall be dissolved
120 days after a Holder of an Interest in such Series either
(a) makes an assignment for the benefit of creditors, (b)
files a voluntary petition in bankruptcy, (c) is adjudicated
a bankrupt or insolvent, (d) files any pleading admitting or
failing to contest the material allegations of a petition
filed against it in any bankruptcy or insolvency proceeding,
or (e) seeks, consents to, or acquiesces in the appointment
of a trustee, receiver, or liquidator of such Holder or of
all or any substantial part of its assets, unless, within
such 120 days, Holders (excluding the Holder with respect
to whom such event occurs) owning a majority of the
Interests in such Series vote to continue the Series. Upon
any dissolution pursuant to this section, the provisions of
Section 10.1(a) (i), (ii), and (iii) shall apply as if such
dissolution were a termination described in Section 10.1.
10.3. Amendment Procedure.
(a) Except as specifically provided herein, the
Trustees may, without the vote or consent of Holders, amend
or otherwise supplement this Instrument by making an
amendment, a trust instrument supplemental hereto or an
amended and restated trust instrument. Holders shall have
the right to vote (i) on any amendment which would affect
their right to vote granted in Section 9.8, (ii) on any
amendment to this Section 10.3, (iii) on any amendment as
may be required by law or by the Trust's registration
statement filed with the Commission, and (iv) on any
amendment submitted to them by the Trustees. Any
amendment required or permitted to be submitted to Holders
which, as the Trustees determine, shall affect the Holders
of one or more Series shall be authorized by vote of the
Holders of each Series affected, and no vote of Holders
of a Series not affected shall be required.
(b) Notwithstanding anything else herein, any
Amendment to Article 5 hereof shall not limit the rights
to indemnification or insurance provided therein with
respect to action or omission of Covered Persons prior
to such amendment. Nothing contained in this Instrument
shall permit the amendment of this Instrument to impair
the exemption from personal liability of the Holders or
Trustees of the Trust.
(c) Notwithstanding anything else herein, no
amendment to Section 5.6 shall be effective until at
least 30 days after the Trust has delivered all Holders
(as of the date of such notice) written notice of such
amendment.
(c) A certification signed by a majority of the
Trustees setting forth an amendment and reciting that
it was duly adopted by the Holders or by the Trustees
as aforesaid or a copy of the Instrument, as amended,
executed by a majority of the Trustees, shall be
conclusive evidence of such amendment when lodged
among the records of the Trust.
Notwithstanding any other provision hereof,
until such time as Interests are first sold, this
Instrument may be terminated or amended in any respect
by the affirmative vote of a majority of the Trustees
or by an instrument signed by a majority of the Trustees.
10.4. Merger, Consolidation or Asset Sale.
Notwithstanding anything else herein, the Trustees may,
without the prior consent or vote of the Holders, cause
the Trust or any Series to merge or consolidate with, or
sell substantially all of its assets to, any other
partnership, trust or other organization. Pursuant to
and in accordance with the provisions of Section 3815(f)
of the Delaware Act, and notwithstanding anything to the
contrary contained in this Instrument, any agreement of
merger or consolidation may effect any amendment to the
Instrument or effect the adoption of a new trust instrument
of the Trust if the Trust or Series is the surviving or
resulting entity in the merger or consolidation.
10.5. Incorporation. Notwithstanding anything
else herein, the Trustees may, without the prior consent
or vote of the Holders, cause to be organized or assist
in organizing a corporation or corporations under the
laws of any jurisdiction or any other trust, partnership,
association or other organization to take over all of the
Trust Property or the assets of any Series or to carry on
any business in which the Trust or any Series shall directly
or indirectly have any interest, and to sell, convey and
transfer the Trust Property or the assets of any Series to
any such corporation, trust, association or organization
in exchange for the equity interests thereof or otherwise,
and to lend money to, subscribe for the equity interests of,
and enter into any contracts with any such corporation, trust,
partnership, association or organization, or any corporation,
partnership, trust, association or organization in which the
Trust or any Series holds or is about to acquire equity
interests. The Trustees may also cause a merger or
consolidation between the Trust or any Series or any
successor thereto and any such corporation, trust,
partnership, association or other organization if and to
the extent permitted by law, as provided under the law
then in effect. In addition, nothing contained herein
shall be construed as requiring approval of the Holders
for the Trustees to organize or assist in organizing one
or more corporations, trusts, partnerships, associations
or other organizations and selling, conveying or
transferring a portion of the Trust Property or the
assets of any Series to such organizations or entities.
ARTICLE XI
Miscellaneous
11.1. Governing Law. The trust set forth in
this instrument is made in the State of Delaware, and
the Trust and this Instrument, and the rights and
obligations of the Trustees and Holders hereunder,
are to be governed by and construed and administered
according to the Delaware Act and the laws of said
State; provided, however, that there shall not be
applicable to the Trust, the Trustees or this Instrument
(a) the provisions of Section 3540 of Title 12 of the
Delaware Code or (b) any provisions of the laws
(statutory or common) of the State of Delaware
(other than the Delaware Act) pertaining to trusts
which relate to or regulate (i) the filing with any
court or governmental body or agency of trustee
accounts or schedules of trustee fees and charges,
(ii) affirmative requirements to post bonds for
trustees, officers, agents or employees of a trust,
(iii) the necessity for obtaining court or other
governmental approval concerning the acquisition,
holding or disposition of real or personal property,
(iv) fees or other sums payable to trustees, officers,
agents or employees of a trust, (v) the allocation of
receipts and expenditures to income or principal,
(vi) restrictions or limitations on the permissible
nature, amount or concentration of trust investments
or requirements relating to the titling, storage or
other manner of holding of trust assets, or (vii) the
establishment of fiduciary or other standards or
responsibilities or limitations on the acts or powers
of trustees, which are inconsistent with the limitations
or liabilities or authorities and powers of the Trustees
set forth or referenced in this Instrument. The Trust
shall be of the type commonly called a "business trust,"
and without limiting the provisions hereof, the Trust
may exercise all powers which are ordinarily exercised
by such a trust under Delaware law. The trust
specifically reserves the right to exercise any of the
powers or privileges afforded to trusts or actions that
may be engaged in by trusts under the Delaware Act, and
the absence of a specific reference herein to any such
power, privilege or action shall not imply that the
Trust may not exercise such power or privilege or take
such actions.
11.2. Counterparts. This Instrument may be
simultaneously executed in several counterparts, each
of which shall be deemed to be an original, and such
counterparts, together, shall constitute one and the
same instrument, which shall be sufficiently evidenced
by any such original counterpart.
11.3. Reliance by Third Parties. Any
certificate executed by an individual who, according
to the records of the Trust or of any recording office
in which this Instrument may be recorded, appears to
be a Trustee hereunder, certifying to: (a)the number
or identity of Trustees or Holders; (b) the due
authorization of the execution of any instrument or
writing; (c)the form of any vote passed at a meeting
of Trustees or Holders; (d) the fact that the number
of Trustees or Holders present at any meeting or
executing any written instrument satisfies the
requirements of this Instrument; (e) the form of
any By-Laws adopted by or the identity of any officers
elected by the Trustees, or; (f) the existence of any
fact or facts which in any manner relate to the affairs
of the Trust, shall be conclusive evidence as to the
matters so certified in favor of any person dealing
with the Trustees and their successors.
11.4. Provisions in Conflict With Law or
Regulations.
(a) The provisions of this Instrument are
severable, and if the Trustees shall determine, with
the advice of counsel, that any of such provisions is
in conflict with any applicable laws or regulations,
the conflicting provision shall be deemed never to
have constituted a part of this Instrument; provided,
however, that such determination shall not affect any
of the remaining provisions of this Instrument or render
invalid or improper any action taken or omitted prior
to such determination.
(b) If any provision of this Instrument shall
be held invalid or unenforceable in any jurisdiction,
such invalidity or unenforceability shall attach only
to such provision in such jurisdiction and shall not
in any manner affect such provision in any other
jurisdiction or any other provision of this Instrument
in any jurisdiction.
(c) It is intended that each Series of the Trust
be classified as a partnership for federal income tax
purposes. The Trustees, in their sole discretion and
without the vote or consent of the Holders, may amend
this Instrument and do whatever else they determine to
be necessary to ensure that this objective is achieved.
11.5. Signatures. All contracts and other
instruments shall be executed on behalf of the Trust by
such officer, officers, agent or agents, as provided in
this Instrument or as the Trustees may from time to time
by resolution provide.
11.6. Seal. The seal of the Trust, if any, may
be affixed to any document, and the seal and its
attestation may be lithographed, engraved or otherwise
printed on any document with the same force and effect
as if it had been imprinted and attested manually in the
same manner and with the same effect as if done by a
Delaware business corporation.
11.7. Fiscal Year. The fiscal year of the Trust
and each Series shall begin on June 1, provided, however,
that the Trustees may from time to time change the fiscal
year of the Trust or of any Series.
11.8. Waivers of Notice. Whenever any notice
whatever is required to be given by law or this Instrument,
a waiver thereof in writing, signed by the person or
persons entitled to said notice, whether before or after
the time stated therein, shall be deemed equivalent thereto.
A notice shall be deemed to have been telegraphed, cabled
or wirelessed for the purposes of this Instrument when it
has been delivered to a representative of any telegraph,
cable or wireless company with instructions that it be
telegraphed, cabled or wirelessed.
11.9. Reports. The Trustees shall cause to be
prepared, at least annually, a report of operations
containing those financial statements as may be required
by laws or as the Trustees may direct for each Series
prepared in conformity with generally accepted accounting
principles and an opinion of an independent public
accountant on such financial statements. The Trustees
shall, in addition, furnish to the Holders of each Series
at least semi-annually interim reports containing unaudited
financial statements as may be required by laws or as the
Trustees may direct.
\\ntsrv0007\LEGAL\CORETRST\DOC\TI-0799.DOC
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.
INDEPENDENT AUDITORS' REPORT
To the Board of Trustees and Shareholders of
Forum Funds:
In planning and performing our audit of the financial
statements of Forum Funds (the "Trust") including
Investors Equity Fund, Equity Index Fund, and Polaris
Global Value Fund Portfolios for the year ended May 31,
1999 (on which we have issued our reports dated July 16,
1999), we considered its internal control, including
control activities for safeguarding securities, in
order to determine our auditing procedures for the
purpose of expressing our opinion on the financial
statements and to comply with the requirements of
Form N-SAR, and not to provide assurance on the Trust's
internal control.
The management of the Trust is responsible for
establishing and maintaining internal control. In
fulfilling this responsibility, estimates and judgments
by management are required to assess the expected
benefits and related costs of controls. Generally,
controls that are relevant to an audit pertain
to the entity's objective of preparing financial
statements for external purposes that are fairly
presented in conformity with generally accepted
accounting principles. Those controls include the
safeguarding of assets against unauthorized acquisition,
use, or disposition.
Because of inherent limitations in any internal control
misstatements, errors or fraud may occur and
not be detected. Also, projections of any evaluation
of internal control to future periods are subject to
the risk that the internal control may become inadequate
because of changes in conditions or that the degree of
compliance with policies or procedures deteriorate.
Our consideration of the Trust's internal control would
not necessarily disclose all matters in internal control
that might be material weaknesses under standards
established by the American Institute of Certified Public
Accountants. A material weakness is a condition in which
the design or operation of one or more of the internal
control components does not reduce to a relatively
low level the risk that misstatements, errors or fraud in
amounts that would be material in relation to the financial
statements being audited may occur and not be detected
within a timely period by employees in the normal course
of performing their assigned functions. However, we noted
no matters involving the Trust's internal control and its
operation, including controls for safeguarding securities,
that we consider to be material weaknesses as defined above
as of May 31, 1999.
This report is intended solely for the information and use
of management, the Board of Trustees of Forum Funds, and
the Securities and Exchange Commission and is not intended
to be and should not be used by anyone other than these
specified parties.
/s/ Deloitte & Touche LLP
Boston, Massachusetts
July 16, 1999
Note 8. Changes in Independent Accountant
On May 31, 1999, the Board of Trustees of the Trust approved
Deloitte & Touche LLP ("Deloitte") as the new independent
accountant for the Fund, subject to the resignation of
PricewaterhouseCoopers, LLP ("PwC") as auditors for the
Fund. The decision to replace PwC with Deloitte was
motivated by the fact that Deloitte already serves as
independent auditor for the other stand alone Funds of the
Trust.
The Fund commenced operations on June 1, 1998. As of the
date of its resignation, PwC had not issued a principal
accountant's report on the Fund's financial statements for
the fiscal year ended May 31, 1999, nor had it commenced its
audit of the Fund's annual financial statements. The Fund
had no disagreements with PwC through the date of its
resignation on any matter of accounting principles or
practices, financial statement disclosure or auditing scope
or procedure.
