SEC REGISTRATION NOS.
2-76527 AND 811-3418
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933
POST-EFFECTIVE AMENDMENT NO. 25 XX
AND/OR
REGISTRATION STATEMENT UNDER THE
INVESTMENT COMPANY ACT OF 1940
AMENDMENT NO. 25 XX
CALVERT CASH RESERVES
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)
4550 MONTGOMERY AVENUE
SUITE 1000N
BETHESDA, MARYLAND 20814
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
REGISTRANT'S TELEPHONE NUMBER: (301) 951-4800
WILLIAM M. TARTIKOFF, ESQ.
4550 MONTGOMERY AVENUE
SUITE 1000N
BETHESDA, MARYLAND 20814
(NAME AND ADDRESS OF AGENT FOR SERVICE)
IT IS PROPOSED THAT THIS FILING WILL BECOME EFFECTIVE
__ IMMEDIATELY UPON FILING XX ON JANUARY 31, 2000
PURSUANT TO PARAGRAPH (B) PURSUANT TO PARAGRAPH (B)
__ 60 DAYS AFTER FILING __ ON (DATE)
PURSUANT TO PARAGRAPH (A) PURSUANT TO PARAGRAPH (A)
OF RULE 485.
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PROSPECTUS
JANUARY 31, 2000
CALVERT CASH RESERVES
TABLE OF CONTENTS
ABOUT THE FUND
INVESTMENT GOAL 2
INVESTMENT STRATEGIES AND RISKS 2
PERFORMANCE CHART 3
FEES AND EXPENSES 3
ABOUT THE ADVISOR
MANAGEMENT 3
YEAR 2000 4
SHAREHOLDER GUIDE
HOW TO BUY SHARES 4
OTHER CALVERT GROUP FEATURES 4
DIVIDENDS, CAPITAL GAINS AND TAXES 5
HOW TO SELL SHARES 6
FINANCIAL HIGHLIGHTS 7
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION (SEC) OR ANY STATE SECURITIES COMMISSION, NOR HAS THE SEC OR
ANY STATE SECURITIES COMMISSION PASSED ON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
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CALVERT CASH RESERVES FUND
ADVISOR CALVERT ASSET MANAGEMENT COMPANY, INC.
FUNDAMENTAL GOAL - INVESTMENT OBJECTIVE
CALVERT CASH RESERVES INSTITUTIONAL PRIME FUND (THE "FUND") IS A MONEY MARKET
FUND WHICH SEEKS TO OBTAIN THE HIGHEST LEVEL OF CURRENT INCOME, CONSISTENT WITH
SAFETY, PRESERVATION OF CAPITAL AND LIQUIDITY THAT IS AVAILABLE THROUGH
INVESTMENTS IN SPECIFIED MONEY MARKET INSTRUMENTS. THE FUND SEEKS TO MAINTAIN A
CONSTANT NET ASSET VALUE OF $1.00 PER SHARE FOR THE FUND.
THE FUND IS DESIGNED FOR INSTITUTIONAL INVESTORS WHO ARE LOOKING FOR A HIGH
QUALITY MONEY MARKET PORTFOLIO.
PRINCIPAL INVESTMENT STRATEGIES
THE FUND'S ASSETS ARE INVESTED PRIMARILY IN TOP-TIER SECURITIES, SUCH AS:
- - HIGH-QUALITY SHORT-TERM INVESTMENTS, INCLUDING US GOVERNMENT
AND AGENCY OR INSTRUMENTALITY SECURITIES;
- - HIGH-QUALITY, US DOLLAR DENOMINATED INTERNATIONAL MONEY MARKET
INVESTMENTS;
- - CERTIFICATES OF DEPOSIT OF MAJOR BANKS;
- - COMMERCIAL PAPER;
- - ELIGIBLE HIGH-GRADE SHORT-TERM CORPORATE OBLIGATIONS,
INCLUDING PARTICIPATION INTERESTS IN LOANS EXTENDED TO ISSUERS OF SUCH
OBLIGATIONS;
- - REPURCHASE AGREEMENTS;
- - REVERSE REPURCHASE AGREEMENTS;
- - BANKERS ACCEPTANCES;
- - FLOATING RATE NOTES;
- - VARIABLE-RATE DEMAND NOTES; AND
- - TAXABLE MUNICIPAL SECURITIES.
THE FUND INVESTS IN ACCORDANCE WITH RULE 2A-7 UNDER THE INVESTMENT COMPANY ACT
OF 1940, AS AMENDED.
RISKS OF INVESTING
THE YIELD OF THE FUND WILL VARY DAILY, DEPENDING ON MARKET INTEREST RATES, AND
TENDS TO FOLLOW THE SAME DIRECTION AS THE RATES.
DIVIDENDS PAID BY THE FUND WILL FLUCTUATE AS INTEREST RATES AND NET INVESTMENT
INCOME FLUCTUATE.
INVESTMENTS IN OBLIGATIONS NOT GUARANTEED BY THE FULL FAITH AND CREDIT OF THE
U.S. GOVERNMENT ARE SUBJECT TO THE ABILITY OF THE ISSUER TO MAKE PAYMENT AT
MATURITY.
PURCHASING OBLIGATIONS FOR FUTURE DELIVERY OR ON A "WHEN-ISSUED" BASIS MAY
INCREASE THE FUND'S OVERALL INVESTMENT EXPOSURE AND INVOLVES A RISK OF LOSS IF
THE VALUE OF THE SECURITIES DECLINES PRIOR TO THE SETTLEMENT DATE. THE
TRANSACTIONS ARE FULLY SECURED AT ALL TIMES.
THE SUDDEN CREDIT DETERIORATION OF A HOLDING COULD CAUSE THE YIELD OR OVERALL
VALUE OF THE FUND TO DECREASE. THE FUND LIMITS THE AMOUNT IT INVESTS IN ANY ONE
ISSUER TO LESSEN EXPOSURE.
AN INVESTMENT IN THE FUND IS NOT A DEPOSIT OF ANY BANK AND IS NEITHER INSURED
NOR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER
GOVERNMENT AGENCY. ALTHOUGH THE FUND SEEKS TO PRESERVE THE VALUE OF YOUR
INVESTMENT AT $1.00 PER SHARE, IT IS POSSIBLE TO LOSE MONEY BY INVESTING IN THE
FUND.
BAR CHART AND PERFORMANCE TABLE
THE FOLLOWING BAR CHART AND TABLE PROVIDE SOME INDICATION OF THE RISKS OF
INVESTING IN THE FUND. THE CHART SHOWS HOW THE PERFORMANCE HAS VARIED FROM YEAR
TO YEAR. PRIOR TO JULY 1, 1996 THE FUND WAS NOT AN INSTITUTIONAL FUND;
THEREFORE, THE EXPENSES WERE HIGHER. THE TABLE COMPARES THE FUND'S RETURNS OVER
TIME TO THE LIPPER INSTITUTIONAL MONEY MARKET INDEX, A COMPOSITE INDEX OF THE
ANNUAL RETURN OF MUTUAL FUNDS THAT HAVE AN INVESTMENT GOAL SIMILAR TO THAT OF
THE FUND. THE FUND'S PAST PERFORMANCE DOES NOT NECESSARILY INDICATE HOW THE FUND
WILL PERFORM IN THE FUTURE.
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YEAR-BY-YEAR TOTAL RETURN
[INSERT BAR CHART HERE]
BEST QUARTER (OF PERIODS SHOWN) Q4 '99 1.45%
WORST QUARTER (OF PERIODS SHOWN) Q1 '99 1.22%
AVERAGE ANNUAL TOTAL RETURNS (FOR THE PERIODS ENDED 12/31/99)
1 YEAR 3 YEAR 5 YEAR* 10 YEAR
CCR INSTITUTIONAL
PRIME 5.27% 5.54% N/A N/A
LIPPER INSTITUTIONAL
MONEY MARKET INDEX 5.09% 5.35% N/A N/A
* PRIOR TO 7/1/96 THE FUND WAS NOT AN INSTITUTIONAL
FUND; THEREFORE, THE EXPENSES WERE HIGHER.
SINCE INCEPTION (7/31/96) 5.55%; LIPPER INSTITUTIONAL MONEY MARKET INDEX 5.34%.
THE MONTH END DATE OF 7/31/96 IS USED FOR COMPARISON PURPOSES ONLY, ACTUAL FUND
INCEPTION IS 7/1/96.
FOR CURRENT YIELD INFORMATION, CALL 1-800-317-2274, OR VISIT CALVERT'S WEBSITE
AT: WWW.CALVERT.COM.
FEES AND EXPENSES OF THE FUND
THIS TABLE DESCRIBES THE FEES AND EXPENSES YOU MAY PAY IF YOU BUY AND HOLD
SHARES OF THE FUND.
A. SHAREHOLDER FEES (FEES PAID DIRECTLY FROM YOUR INVESTMENT)
MAXIMUM SALES LOAD ON PURCHASES NONE
MAXIMUM DEFERRED SALES LOAD NONE
MAXIMUM SALES LOAD ON
REINVESTED DIVIDENDS NONE
REDEMPTION FEES NONE
EXCHANGE FEE NONE
B. ANNUAL FUND OPERATING EXPENSES - FISCAL YEAR ENDED SEPTEMBER 30, 1999
(EXPENSES THAT ARE DEDUCTED FROM FUND ASSETS)
MANAGEMENT FEES1 0.30%
RULE 12B-1 AND/OR SERVICE FEES NONE
OTHER EXPENSES 0.06%
TOTAL FUND OPERATING EXPENSES 0.36%*
1MANAGEMENT FEES INCLUDE THE ADMINISTRATIVE FEE PAID BY THE FUND TO CALVERT
ADMINISTRATIVE SERVICES COMPANY, AN AFFILIATE OF THE ADVISOR.
*THE TOTAL FUND OPERATING EXPENSES, NET OF REIMBURSEMENT OR FEE WAIVER, WERE
0.21% FOR FISCAL YEAR 1999.
C. EXAMPLE:
THIS EXAMPLE IS INTENDED TO HELP YOU COMPARE THE COST OF INVESTING IN THE FUND
WITH THE COST OF INVESTING IN OTHER MUTUAL FUNDS. THE EXAMPLE ASSUMES THAT:
- - YOU INVEST $1,000,000 (THE MINIMUM REQUIRED INVESTMENT) IN
THE FUND FOR THE TIME PERIODS INDICATED;
- - YOU REDEEM ALL SHARES AT THE END OF THE PERIODS;
- - YOUR INVESTMENT HAS A 5% RETURN EACH YEAR; AND
- - THE FUND'S OPERATING EXPENSES REMAIN THE SAME.
ALTHOUGH YOUR ACTUAL COSTS MAY BE HIGHER OR LOWER, UNDER THESE ASSUMPTIONS YOUR
COSTS WOULD BE:
1 YEAR 3 YEARS 5 YEARS 10 YEARS
$3,684 $11,571 $20,208 $45,560
MANAGEMENT AND ADVISORY FEES
CALVERT ASSET MANAGEMENT COMPANY, INC. ("CAMCO") IS THE FUND'S INVESTMENT
ADVISOR. CAMCO HAS BEEN MANAGING MUTUAL FUNDS SINCE 1976, AND IS A SUBSIDIARY OF
CALVERT GROUP, LTD. CAMCO CURRENTLY ADVISES OVER 25 MUTUAL FUND PORTFOLIOS,
INCLUDING THE FIRST AND LARGEST FAMILY OF SOCIALLY SCREENED FUNDS. CAMCO IS
LOCATED AT 4550 MONTGOMERY AVENUE, SUITE 1000N, BETHESDA, MARYLAND 20814. AS OF
DECEMBER 31, 1999, IT HAS OVER $6 BILLION IN ASSETS UNDER MANAGEMENT.
CAMCO PROVIDES THE FUND WITH INVESTMENT SUPERVISION AND MANAGEMENT;
ADMINISTRATIVE SERVICES AND OFFICE SPACE; AND FURNISHES EXECUTIVE AND OTHER
PERSONNEL TO THE FUND. CAMCO ALSO PAYS THE SALARIES AND FEES OF ALL TRUSTEES WHO
ARE AFFILIATED PERSONS. CAMCO MAY PAY CERTAIN ADVERTISING AND PROMOTIONAL
EXPENSES OF THE FUND. THE ADVISORY FEE PAID TO CAMCO BY THE FUND FOR THE FISCAL
YEAR ENDED SEPTEMBER 30, 1999, WAS 0. % OF THE FUND'S AVERAGE DAILY NET ASSETS.
CAMCO MAY VOLUNTARILY WAIVE A PORTION OF ITS ADVISORY FEE.
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A WORD ABOUT THE YEAR 2000 (Y2K) AND OUR COMPUTER SYSTEMS
LIKE WITH OTHER MUTUAL FUNDS, CAMCO AND ITS SERVICE PROVIDERS USE COMPUTER
SYSTEMS FOR ALL ASPECTS OF OUR BUSINESS-PROCESSING SHAREHOLDER AND FUND
TRANSACTIONS, FUND ACCOUNTING, EXECUTING TRADES, AND PRICING SECURITIES JUST TO
NAME A FEW. THE CONCERN HAS BEEN THAT MANY SOFTWARE PROGRAMS CANNOT DISTINGUISH
BETWEEN THE YEAR 2000 AND THE YEAR 1900. THIS COULD CAUSE PROBLEMS WITH
RETIREMENT PLAN DISTRIBUTIONS, DIVIDEND PAYMENT SOFTWARE, TRANSACTION SOFTWARE,
AND NUMEROUS OTHER AREAS THAT IMPACT THE FUND. LEADING UP TO THIS YEAR, CALVERT
GROUP HAS BEEN REVIEWING ALL OF ITS COMPUTER SYSTEMS FOR Y2K COMPLIANCE.
ALTHOUGH, THUS FAR, THERE HAVE BEEN NO PROBLEMS CAUSED BY Y2K THAT COULD IMPACT
THE FUND, THERE CAN BE NO ASSURANCE THAT THERE WILL BE NO FUTURE NEGATIVE IMPACT
ON THE FUND. THE ADVISOR, THE UNDERWRITER, TRANSFER AGENT AND CUSTODIAN HAVE
ADVISED THE FUND THAT THEY WILL CONTINUE TO ACTIVELY WORK ON ANY NECESSARY
CHANGES TO THEIR COMPUTER SYSTEMS TO ADDRESS ANY ISSUES THAT MAY ARISE
THROUGHOUT THE YEAR AND EXPECT THAT THEIR SYSTEMS, AND THOSE OF THEIR OUTSIDE
SERVICE PROVIDERS, WILL BE ADAPTED ACCORDINGLY. FOR MORE INFORMATION, PLEASE
VISIT OUR WEBSITE AT WWW.CALVERT.COM.
HOW TO BUY SHARES
COMPLETE AND SIGN AN APPLICATION FOR EACH NEW ACCOUNT. FOR MORE INFORMATION,
PLEASE CONTACT THE CALVERT INSTITUTIONAL MARKETING GROUP AT 800-317-2274.
THE MINIMUM INITIAL INVESTMENT AND MINIMUM BALANCE REQUIRED IS $1,000,000. THERE
IS NO MINIMUM FOR SUBSEQUENT INVESTMENTS. INVESTMENTS MAY BE MADE BY WIRE OR BY
EXCHANGE FROM ANOTHER CALVERT GROUP ACCOUNT:
ABA#011000028
FBO: CALVERT CASH RESERVES FUND 707
WIRE ACCOUNT #9903-765-7
INSERT YOUR NAME AND ACCOUNT NUMBER HERE
STATE STREET BANK & TRUST COMPANY
BOSTON, MASSACHUSETTS
IMPORTANT - HOW SHARES ARE PRICED
THE PRICE OF SHARES IS BASED ON THE FUND'S NET ASSET VALUE ("NAV"). NAV IS
COMPUTED BY ADDING THE VALUE OF THE FUND'S HOLDINGS PLUS OTHER ASSETS,
SUBTRACTING LIABILITIES, AND THEN DIVIDING THE RESULT BY THE NUMBER OF SHARES
OUTSTANDING.
THE FUND IS VALUED ACCORDING TO THE "AMORTIZED COST" METHOD, WHICH IS INTENDED
TO STABILIZE THE NAV AT $1 PER SHARE. IF MARKET QUOTATIONS ARE NOT READILY
AVAILABLE, SECURITIES ARE VALUED BY A METHOD THAT THE FUND'S BOARD OF
TRUSTEES/DIRECTORS BELIEVES ACCURATELY REFLECTS FAIR VALUE.
THE NAV IS CALCULATED AS OF THE CLOSE OF EACH BUSINESS DAY, WHICH COINCIDES WITH
THE CLOSING OF THE REGULAR SESSION OF THE NEW YORK STOCK EXCHANGE ("NYSE")
(NORMALLY 4 P.M. ET). THE FUND IS OPEN FOR BUSINESS EACH DAY THE NYSE IS OPEN.
PLEASE NOTE THAT THERE ARE SOME FEDERAL HOLIDAYS, HOWEVER, SUCH AS COLUMBUS DAY
AND VETERANS' DAY, WHEN THE NYSE IS OPEN AND THE FUND IS OPEN BUT PURCHASES
CANNOT BE RECEIVED BECAUSE THE BANKS ARE CLOSED.
WHEN YOUR ACCOUNT WILL BE CREDITED
YOUR PURCHASE WILL BE PROCESSED AT THE NAV CALCULATED AFTER YOUR ORDER IS
RECEIVED. A TELEPHONE ORDER PLACED TO CALVERT INSTITUTIONAL MARKETING GROUP BY
1:00 P.M. EASTERN TIME WILL RECEIVE THE DIVIDEND ON FUND SHARES DECLARED THAT
DAY IF FEDERAL FUNDS ARE RECEIVED BY THE CUSTODIAN BY 5 P.M. EASTERN TIME.
TELEPHONE ORDERS PLACED AFTER 1:00 P.M. WILL BEGIN EARNING DIVIDENDS ON FUND
SHARES THE NEXT BUSINESS DAY. IF NO TELEPHONE ORDER IS PLACED, INVESTMENTS BEGIN
EARNING DIVIDENDS THE NEXT BUSINESS DAY. EXCHANGES BEGIN EARNING DIVIDENDS THE
NEXT BUSINESS DAY AFTER THE EXCHANGE REQUEST IS RECEIVED BY MAIL OR TELEPHONE.
ALL OF YOUR PURCHASES MUST BE MADE BY WIRE. NO CASH OR CHECKS WILL BE ACCEPTED.
THE FUND RESERVES THE RIGHT TO SUSPEND THE OFFERING OF SHARES FOR A PERIOD OF
TIME OR TO REJECT ANY SPECIFIC PURCHASE ORDER.
OTHER CALVERT GROUP FEATURES
CALVERT INFORMATION NETWORK
FOR 24 HOUR PERFORMANCE AND ACCOUNT INFORMATION CALL 800-368-2745 OR VISIT
WWW.CALVERT.COM YOU CAN OBTAIN CURRENT PERFORMANCE AND PRICING INFORMATION,
VERIFY ACCOUNT BALANCES, AND AUTHORIZE CERTAIN TRANSACTIONS WITH THE CONVENIENCE
OF ONE PHONE CALL, 24 HOURS A DAY.
ACCOUNT SERVICES
BY SIGNING UP FOR SERVICES WHEN YOU OPEN YOUR ACCOUNT, YOU AVOID HAVING TO
OBTAIN A SIGNATURE GUARANTEE. IF YOU WISH TO ADD SERVICES AT A LATER DATE, A
SIGNATURE GUARANTEE TO VERIFY YOUR SIGNATURE MAY BE OBTAINED FROM ANY BANK,
TRUST COMPANY AND SAVINGS AND LOAN ASSOCIATION, CREDIT UNION, BROKER-DEALER FIRM
OR MEMBER OF A DOMESTIC STOCK EXCHANGE. A NOTARY PUBLIC CANNOT PROVIDE A
SIGNATURE GUARANTEE.
TELEPHONE TRANSACTIONS
YOU MAY REDEEM BY EXCHANGE OF SHARES OR BY WIRE IF YOU HAVE PRE-AUTHORIZED
SERVICE INSTRUCTIONS. YOU RECEIVE TELEPHONE PRIVILEGES AUTOMATICALLY WHEN YOU
OPEN YOUR ACCOUNT UNLESS YOU ELECT OTHERWISE. FOR OUR MUTUAL PROTECTION, THE
FUND, THE SHAREHOLDER SERVICING AGENT AND THEIR AFFILIATES USE PRECAUTIONS SUCH
AS VERIFYING SHAREHOLDER IDENTITY AND RECORDING TELEPHONE CALLS TO CONFIRM
INSTRUCTIONS GIVEN BY PHONE. A CONFIRMATION STATEMENT IS SENT FOR MOST
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TRANSACTIONS; PLEASE REVIEW THIS STATEMENT AND VERIFY THE ACCURACY OF YOUR
TRANSACTION IMMEDIATELY.
EXCHANGES
CALVERT GROUP OFFERS A WIDE VARIETY OF INVESTMENT OPTIONS THAT INCLUDES COMMON
STOCK FUNDS, TAX-EXEMPT AND CORPORATE BOND FUNDS, AND MONEY MARKET FUNDS. WE
MAKE IT EASY FOR YOU TO PURCHASE SHARES IN OTHER CALVERT FUNDS IF YOUR
INVESTMENT GOALS CHANGE. THE EXCHANGE PRIVILEGE OFFERS FLEXIBILITY BY ALLOWING
YOU TO EXCHANGE SHARES ON WHICH YOU HAVE ALREADY PAID A SALES CHARGE FROM ONE
MUTUAL FUND TO ANOTHER AT NO ADDITIONAL CHARGE.
COMPLETE AND SIGN AN ACCOUNT APPLICATION, TAKING CARE TO REGISTER YOUR NEW
ACCOUNT IN THE SAME NAME AND TAXPAYER IDENTIFICATION NUMBER AS YOUR EXISTING
CALVERT ACCOUNT(S). EXCHANGE INSTRUCTIONS MAY THEN BE GIVEN BY TELEPHONE IF
TELEPHONE REDEMPTIONS HAVE BEEN AUTHORIZED AND THE SHARES ARE NOT IN CERTIFICATE
FORM.
BEFORE YOU MAKE AN EXCHANGE, PLEASE NOTE THE FOLLOWING:
EACH EXCHANGE REPRESENTS THE SALE OF SHARES OF ONE FUND AND THE PURCHASE OF
SHARES OF ANOTHER.
YOU MAY EXCHANGE SHARES ACQUIRED BY REINVESTMENT OF DIVIDENDS OR DISTRIBUTIONS
INTO ANOTHER CALVERT FUND AT NO ADDITIONAL CHARGE.
SHARES MAY ONLY BE EXCHANGED FOR SHARES OF THE SAME CLASS OF ANOTHER CALVERT
FUND.
EXCHANGE REQUESTS WILL NOT BE ACCEPTED ON ANY DAY WHEN CALVERT IS OPEN BUT THE
FUND'S CUSTODIAN BANK IS CLOSED (E.G., COLUMBUS DAY AND VETERAN'S DAY); THESE
EXCHANGE REQUESTS WILL BE PROCESSED THE NEXT DAY THE FUND'S CUSTODIAN BANK IS
OPEN.
THE FUND AND THE DISTRIBUTOR RESERVE THE RIGHT AT ANY TIME TO REJECT OR CANCEL
ANY PART OF ANY PURCHASE OR EXCHANGE ORDER; MODIFY ANY TERMS OR CONDITIONS OF
PURCHASE OF SHARES OF THE FUND; OR WITHDRAW ALL OR ANY PART OF THE OFFERING MADE
BY THIS PROSPECTUS. TO PROTECT THE INTERESTS OF INVESTORS, THE FUND AND THE
DISTRIBUTOR MAY REJECT ANY ORDER CONSIDERED MARKET-TIMING ACTIVITY.
THE FUND RESERVES THE RIGHT TO TERMINATE OR MODIFY THE EXCHANGE PRIVILEGE WITH
60 DAYS' WRITTEN NOTICE.
ELECTRONIC DELIVERY OF PROSPECTUSES AND
SHAREHOLDER REPORTS
YOU MAY REQUEST TO RECEIVE ELECTRONIC DELIVERY OF PROSPECTUSES AND ANNUAL AND
SEMI ANNUAL REPORTS.
COMBINED GENERAL MAILINGS (HOUSEHOLDING)
MULTIPLE ACCOUNTS WITH THE SAME TAX IDENTIFICATION NUMBER WILL RECEIVE ONE
MAILING PER HOUSEHOLD OF INFORMATION SUCH AS PROSPECTUSES AND SEMI-ANNUAL AND
ANNUAL REPORTS. YOU MAY REQUEST FURTHER GROUPING OF ACCOUNTS TO RECEIVE FEWER
MAILINGS. SEPARATE STATEMENTS WILL BE GENERATED FOR EACH SEPARATE ACCOUNT AND
WILL BE MAILED IN ONE ENVELOPE FOR EACH COMBINATION ABOVE.
SPECIAL SERVICES AND CHARGES
THE FUND PAYS FOR SHAREHOLDER SERVICES BUT NOT FOR SPECIAL SERVICES THAT ARE
REQUIRED BY A FEW SHAREHOLDERS, SUCH AS A REQUEST FOR A HISTORICAL TRANSCRIPT OF
AN ACCOUNT. YOU MAY BE REQUIRED TO PAY A FEE FOR THESE SPECIAL SERVICES.
IF YOU ARE PURCHASING SHARES THROUGH A PROGRAM OF SERVICES OFFERED BY A
BROKER/DEALER OR FINANCIAL INSTITUTION, YOU SHOULD READ THE PROGRAM MATERIALS
TOGETHER WITH THIS PROSPECTUS. CERTAIN FEATURES MAY BE MODIFIED IN THESE
PROGRAMS, AND THE BROKER/DEALER OR FINANCIAL INSTITUTION MAY IMPOSE CHARGES FOR
THEIR SERVICES.
DIVIDENDS, CAPITAL GAINS AND TAXES
THE FUND ACCRUES DIVIDENDS DAILY FROM ITS NET INVESTMENT INCOME, AND PAYS THE
DIVIDENDS MONTHLY. NET INVESTMENT INCOME CONSISTS OF INTEREST INCOME, NET
SHORT-TERM CAPITAL GAINS, IF ANY, AND DIVIDENDS DECLARED AND PAID ON
INVESTMENTS, LESS EXPENSES. DISTRIBUTIONS OF NET SHORT-TERM CAPITAL GAINS
(TREATED AS DIVIDENDS FOR TAX PURPOSES) AND NET LONG-TERM CAPITAL GAINS, IF ANY,
ARE NORMALLY PAID ONCE A YEAR; HOWEVER, THE FUND DOES NOT ANTICIPATE MAKING ANY
SUCH DISTRIBUTIONS UNLESS AVAILABLE CAPITAL LOSS CARRYOVERS HAVE BEEN USED OR
HAVE EXPIRED.
DIVIDEND PAYMENT OPTIONS
DIVIDENDS AND ANY DISTRIBUTIONS ARE AUTOMATICALLY REINVESTED IN THE SAME FUND AT
NAV (WITHOUT SALES CHARGE), UNLESS YOU ELECT TO HAVE AMOUNTS OF $10 OR MORE
WIRED TO A PREDESIGNATED BANK ACCOUNT. DIVIDENDS AND DISTRIBUTIONS FROM ANY
CALVERT GROUP FUND MAY BE AUTOMATICALLY INVESTED IN AN IDENTICALLY REGISTERED
ACCOUNT IN ANY OTHER CALVERT GROUP FUND AT NAV. IF REINVESTED IN THE SAME
ACCOUNT, NEW SHARES WILL BE PURCHASED AT NAV ON THE REINVESTMENT DATE, WHICH IS
GENERALLY 1 TO 3 DAYS PRIOR TO THE PAYMENT DATE. YOU MUST NOTIFY THE FUND IN
WRITING TO CHANGE YOUR PAYMENT OPTIONS. IF YOU ELECT TO HAVE DIVIDENDS AND/OR
DISTRIBUTIONS PAID IN CASH, AND THE US POSTAL SERVICE RETURNS THE CHECK AS
UNDELIVERABLE, IT, AS WELL AS FUTURE DIVIDENDS AND DISTRIBUTIONS, WILL BE
REINVESTED IN ADDITIONAL SHARES. NO DIVIDENDS WILL ACCRUE ON AMOUNTS REPRESENTED
BY UNCASHED DISTRIBUTION OR REDEMPTION CHECKS.
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FEDERAL TAXES
IN JANUARY, THE FUND WILL MAIL YOU FORM 1099-DIV INDICATING THE FEDERAL TAX
STATUS OF DIVIDENDS AND ANY CAPITAL GAIN DISTRIBUTIONS PAID TO YOU DURING THE
PAST YEAR. GENERALLY, DIVIDENDS AND DISTRIBUTIONS ARE TAXABLE IN THE YEAR THEY
ARE PAID. HOWEVER, ANY DIVIDENDS AND DISTRIBUTIONS PAID IN JANUARY BUT DECLARED
DURING THE PRIOR THREE MONTHS ARE TAXABLE IN THE YEAR DECLARED. DIVIDENDS AND
DISTRIBUTIONS ARE TAXABLE TO YOU REGARDLESS OF WHETHER THEY ARE TAKEN IN CASH OR
REINVESTED. DIVIDENDS, INCLUDING SHORT-TERM CAPITAL GAINS, ARE TAXABLE AS
ORDINARY INCOME. DISTRIBUTIONS FROM LONG-TERM CAPITAL GAINS ARE TAXABLE AS
LONG-TERM CAPITAL GAINS, REGARDLESS OF HOW LONG YOU HAVE OWNED SHARES.
OTHER TAX INFORMATION
IN ADDITION TO FEDERAL TAXES, YOU MAY BE SUBJECT TO STATE OR LOCAL TAXES ON YOUR
INVESTMENT, DEPENDING ON THE LAWS IN YOUR AREA. YOU WILL BE NOTIFIED TO THE
EXTENT, IF ANY, THAT DIVIDENDS REFLECT INTEREST RECEIVED FROM US GOVERNMENT
SECURITIES. SUCH DIVIDENDS MAY BE EXEMPT FROM CERTAIN STATE INCOME TAXES.
TAXPAYER IDENTIFICATION NUMBER
IF WE DO NOT HAVE YOUR CORRECT SOCIAL SECURITY OR TAXPAYER IDENTIFICATION NUMBER
("TIN") AND A SIGNED CERTIFIED APPLICATION OR FORM W-9, FEDERAL LAW REQUIRES US
TO WITHHOLD 31% OF YOUR REPORTABLE DIVIDENDS, AND POSSIBLY 31% OF CERTAIN
REDEMPTIONS. IN ADDITION, YOU MAY BE SUBJECT TO A FINE BY THE INTERNAL REVENUE
SERVICE. YOU WILL ALSO BE PROHIBITED FROM OPENING ANOTHER ACCOUNT BY EXCHANGE.
IF THIS TIN INFORMATION IS NOT RECEIVED WITHIN 60 DAYS AFTER YOUR ACCOUNT IS
ESTABLISHED, YOUR ACCOUNT MAY BE REDEEMED (CLOSED) AT THE CURRENT NAV ON THE
DATE OF REDEMPTION. CALVERT GROUP RESERVES THE RIGHT TO REJECT ANY NEW ACCOUNT
OR ANY PURCHASE ORDER FOR FAILURE TO SUPPLY A CERTIFIED TIN.
HOW TO SELL SHARES
YOU MAY REDEEM ALL OR A PORTION OF YOUR SHARES ON ANY DAY THE FUND IS OPEN FOR
BUSINESS, PROVIDED THE AMOUNT REQUESTED IS NOT ON HOLD. YOUR SHARES WILL BE
REDEEMED AT THE NEXT NAV CALCULATED AFTER YOUR REDEMPTION REQUEST IS RECEIVED.
YOU WILL RECEIVE DIVIDENDS THROUGH THE DATE THE REQUEST IS RECEIVED AND
PROCESSED. A TELEPHONE ORDER FOR A REDEMPTION MUST BE RECEIVED BY THE CALVERT
INSTITUTIONAL MARKETING GROUP BY NOON EASTERN TIME IN ORDER FOR THE PROCEEDS TO
BE SENT TO YOU ON THE SAME BUSINESS DAY. IF MAKING IMMEDIATE PAYMENT COULD
ADVERSELY AFFECT THE FUND, IT MAY TAKE UP TO SEVEN (7) DAYS TO MAKE PAYMENT. THE
FUND HAS THE RIGHT TO REDEEM SHARES IN ASSETS OTHER THAN CASH FOR REDEMPTION
AMOUNTS EXCEEDING, IN ANY 90-DAY PERIOD, $250,000 OR 1% OF THE NET ASSET VALUE
OF THE FUND, WHICHEVER IS LESS. WHEN THE NYSE IS CLOSED (OR WHEN TRADING IS
RESTRICTED) FOR ANY REASON OTHER THAN ITS CUSTOMARY WEEKEND OR HOLIDAY CLOSINGS,
OR UNDER ANY EMERGENCY CIRCUMSTANCES AS DETERMINED BY THE SECURITIES AND
EXCHANGE COMMISSION, REDEMPTIONS MAY BE SUSPENDED OR PAYMENT DATES POSTPONED.
PLEASE NOTE THAT THERE ARE SOME FEDERAL HOLIDAYS, HOWEVER, SUCH AS COLUMBUS DAY
AND VETERANS' DAY, WHEN THE NYSE IS OPEN AND THE FUND IS OPEN BUT REDEMPTIONS
CANNOT BE MAILED OR WIRED BECAUSE THE POST OFFICE AND BANKS ARE CLOSED.FOLLOW
THESE SUGGESTIONS TO ENSURE TIMELY PROCESSING OF YOUR REDEMPTION REQUEST:
BY TELEPHONE
YOU MAY REDEEM SHARES FROM YOUR ACCOUNT BY TELEPHONE AND HAVE YOUR MONEY
ELECTRONICALLY TRANSFERRED OR WIRED TO A BANK YOU HAVE PREVIOUSLY AUTHORIZED. TO
BETTER ENABLE CAMCO TO KEEP THE FUND FULLY INVESTED, CALVERT REQUESTS THAT YOU
NOTIFY THE INSTITUTIONAL MARKETING GROUP AT LEAST 24 HOURS IN ADVANCE FOR ANY
REDEMPTION OVER $10 MILLION PER DAY. A CHARGE OF $5 MAY BE IMPOSED ON WIRE
TRANSFERS OF LESS THAN $50,000.
WRITTEN REQUESTS
CALVERT GROUP, P.O. BOX 219544,
KANSAS CITY, MO 64121-9544
YOUR LETTER SHOULD INCLUDE YOUR ACCOUNT NUMBER AND FUND AND THE NUMBER OF SHARES
OR THE DOLLAR AMOUNT YOU ARE REDEEMING. PLEASE PROVIDE A DAYTIME TELEPHONE
NUMBER, IF POSSIBLE, FOR US TO CALL IF WE HAVE QUESTIONS. IF THE MONEY IS BEING
SENT TO A NEW BANK, PERSON, OR ADDRESS OTHER THAN THE ADDRESS OF RECORD, YOUR
LETTER MUST BE SIGNATURE GUARANTEED.
CORPORATIONS AND ASSOCIATIONS
YOUR LETTER OF INSTRUCTION AND CORPORATE RESOLUTION SHOULD BE SIGNED BY
PERSON(S) AUTHORIZED TO ACT ON THE ACCOUNT, ACCOMPANIED BY SIGNATURE
GUARANTEE(S).
FINANCIAL HIGHLIGHTS
THE FINANCIAL HIGHLIGHTS TABLE IS INTENDED TO HELP YOU UNDERSTAND THE FUND'S
FINANCIAL PERFORMANCE FOR THE PAST FIVE (5) FISCAL YEARS. THE FUND'S FISCAL YEAR
END IS SEPTEMBER 30. CERTAIN INFORMATION REFLECTS FINANCIAL RESULTS FOR A SINGLE
SHARE. THE TOTAL RETURNS IN THE TABLE REPRESENT THE RATE THAT AN INVESTOR WOULD
HAVE EARNED (OR LOST) ON AN INVESTMENT IN THE FUND, ASSUMING REINVESTMENT OF ALL
DIVIDENDS AND DISTRIBUTIONS. THIS INFORMATION HAS BEEN AUDITED BY
PRICEWATERHOUSECOOPERS LLP, WHOSE REPORT AND THE FUND'S FINANCIAL STATEMENTS ARE
INCLUDED IN THE FUND'S ANNUAL REPORT, AVAILABLE UPON REQUEST.
<PAGE>
FINANCIAL HIGHLIGHTS
Years Ended September 30,
1999
Net asset value, beginning $1.00
Income from investment operations
Net investment income .051
Distributions from
Net investment income (.051)
Net asset value, ending $1.00
Total return 5.18%
Ratios to average net assets:
Net investment income 5.05%
Total expenses .36%
Expenses before offsets .22%
Net expenses .21%
Net assets, ending (in thousands) $594,824
Number of shares outstanding,
ending (in thousands) 594,813
Years Ended September 30,
1998 1997 1996
Net asset value, beginning $1.00 $1.00 $1.00
Income from investment operations
Net investment income .056 .055 .040
Distributions from
Net investment income (.056) (.055) (.040)
Net asset value, ending $1.00 $1.00 $1.00
Total return 5.74% 5.55% 3.99%
Ratios to average net assets:
Net investment income 5.59% 5.55% 4.80%
Total expenses .14% .07% .73%
Expenses before offsets . .14% .07% .73%
Net expenses .13% .06% .69%
Net assets, ending (in thousands) $436,685 $375,351 $131,218
Number of shares outstanding,
ending (in thousands) 436,680 375,353 131,217
Years Ended September 30,
1995
Net asset value, beginning $1.00
Income from investment operations
Net investment income .045
Distributions from
Net investment income (.045)
Net asset value, ending $1.00
Total return 4.55%
Ratios to average net assets:
Net investment income 4.53%
Total expenses + 1.41%
Expenses before offsets 1.41%
Net expenses 1.39%
Net assets, ending (in thousands) $26,775
Number of shares outstanding,
ending (in thousands) 26,821
TO OPEN AN ACCOUNT:
800-368-2748
PERFORMANCE AND PRICES:
WWW.CALVERT.COM
CALVERT INFORMATION NETWORK
24 HOURS, 7 DAYS A WEEK
800-368-2745
SERVICE FOR EXISTING ACCOUNTS:
SHAREHOLDERS 800-368-2745
BROKERS 800-368-2746
TDD FOR HEARING-IMPAIRED:
800-541-1524
BRANCH OFFICE:
4550 MONTGOMERY AVENUE
SUITE 1000N
BETHESDA, MD 20814
REGISTERED, CERTIFIED OR
OVERNIGHT MAIL:
CALVERT GROUP
C/O INSTITUTIONAL MARKETING GROUP
4550 MONTGOMERY AVENUE
SUITE 1000N
BETHESDA, MD 20814
CALVERT GROUP WEB-SITE
ADDRESS: WWW.CALVERT.COM
PRINCIPAL UNDERWRITER
CALVERT DISTRIBUTORS, INC.
4550 MONTGOMERY AVENUE
SUITE 1000N
BETHESDA, MD 20814
<PAGE>
FOR INVESTORS WHO WANT MORE INFORMATION ABOUT THE FUND, THE FOLLOWING DOCUMENTS
ARE AVAILABLE FREE UPON REQUEST:
ANNUAL/SEMI-ANNUAL REPORTS: ADDITIONAL INFORMATION ABOUT THE FUND'S INVESTMENTS
IS AVAILABLE IN THE FUND'S ANNUAL AND SEMI-ANNUAL REPORTS TO SHAREHOLDERS. IN
THE FUND'S ANNUAL REPORT, YOU WILL FIND A DISCUSSION OF THE MARKET CONDITIONS
AND INVESTMENT STRATEGIES THAT SIGNIFICANTLY AFFECTED THE FUND'S PERFORMANCE
DURING ITS LAST FISCAL YEAR.
SAI: THE SAI FOR THE FUND PROVIDES MORE DETAILED INFORMATION ABOUT THE FUND AND
IS INCORPORATED INTO THIS PROSPECTUS BY REFERENCE.
YOU CAN GET FREE COPIES OF REPORTS AND THE SAI, REQUEST OTHER INFORMATION AND
DISCUSS YOUR QUESTIONS ABOUT THE FUND BY CONTACTING YOUR FINANCIAL PROFESSIONAL,
OR THE FUND AT:
CALVERT GROUP
4550 MONTGOMERY AVE.
SUITE 1000N
BETHESDA, MD 20814
TELEPHONE: 1-800-317-2274
CALVERT GROUP WEB-SITE:
WWW.CALVERT.COM
YOU CAN REVIEW THE FUND'S REPORTS AND SAI AT THE PUBLIC REFERENCE ROOM OF THE
SECURITIES AND EXCHANGE COMMISSION. YOU CAN GET TEXT-ONLY COPIES:
- - FOR A FEE, BY WRITING TO OR CALLING THE PUBLIC REFERENCE SECTION OF THE
COMMISSION, WASHINGTON, D.C. 20549-6009, TELEPHONE: 1-800-SEC-0330.
- - FREE FROM THE COMMISSION'S INTERNET WEBSITE AT WWW.SEC.GOV.
INVESTMENT COMPANY ACT FILE NO.: 811-3418
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION-JANUARY 31, 2000
CALVERT CASH RESERVES
INSTITUTIONAL PRIME FUND
4550 MONTGOMERY AVENUE, BETHESDA, MARYLAND 20814
NEW ACCOUNT (800) 368-2748 SHAREHOLDER
INFORMATION: (301) 951-4820 SERVICES: (800) 368-2745
BROKER (800) 368-2746 TDD FOR THE HEARING-
SERVICES: (301) 951-4850 IMPAIRED: (800) 541-1524
THIS STATEMENT OF ADDITIONAL INFORMATION IS NOT A PROSPECTUS. INVESTORS
SHOULD READ THE STATEMENT OF ADDITIONAL INFORMATION IN CONJUNCTION WITH THE
FUND'S PROSPECTUS DATED JANUARY 31, 2000, WHICH MAY BE OBTAINED FREE OF CHARGE
BY WRITING OR CALLING THE FUND, OR BY VISITING OUR WEBSITE AT WWW.CALVERT.COM.
THE AUDITED FINANCIAL STATEMENTS INCLUDED IN THE ANNUAL REPORT TO
SHAREHOLDERS DATED SEPTEMBER 30, 1999, ARE EXPRESSLY INCORPORATED BY REFERENCE
AND MADE A PART OF THIS STATEMENT OF ADDITIONAL INFORMATION. COPIES OF THIS
REPORT MAY BE OBTAINED FREE OF CHARGE BY WRITING OR CALLING THE FUND.
TABLE OF CONTENTS
INVESTMENT POLICIES AND RISKS 1
INVESTMENT RESTRICTIONS 3
PURCHASE AND REDEMPTION OF SHARES 4
DIVIDENDS AND TAXES 4
VALUATION OF SHARES 5
CALCULATION OF YIELD 5
ADVERTISING 6
TRUSTEES AND OFFICERS 6
INVESTMENT ADVISOR 9
ADMINISTRATIVE SERVICES AGENT 9
TRANSFER AND SHAREHOLDER SERVICING AGENTS 10
INDEPENDENT ACCOUNTANTS AND CUSTODIANS 10
METHOD OF DISTRIBUTION 10
PORTFOLIO TRANSACTIONS 10
PERSONAL SECURITIES TRANSACTIONS 11
GENERAL INFORMATION 11
CONTROL PERSONS AND PRINCIPAL HOLDERS
OF SECURITIES 11
APPENDIX 11
INVESTMENT POLICIES AND RISKS
-----------------------------
CALVERT CASH RESERVES IS AN OPEN-END MANAGEMENT INVESTMENT COMPANY. CALVERT
CASH RESERVES INSTITUTIONAL PRIME FUND (THE "FUND") IS A DIVERSIFIED MONEY
MARKET FUND WHICH SEEKS TO OBTAIN THE HIGHEST LEVEL OF CURRENT INCOME,
CONSISTENT WITH SAFETY, AND THE PRESERVATION OF CAPITAL AND LIQUIDITY, THAT IS
AVAILABLE THROUGH INVESTMENT IN SPECIFIED MONEY MARKET INSTRUMENTS. THE
FOLLOWING DISCUSSION SUPPLEMENTS THE DISCUSSION IN THE PROSPECTUS.
REPURCHASE AGREEMENTS
THE FUND ENGAGES IN REPURCHASE AGREEMENTS IN ORDER TO EARN A HIGHER RATE OF
RETURN THAN IT COULD EARN SIMPLY BY INVESTING IN THE OBLIGATION WHICH IS THE
SUBJECT OF THE REPURCHASE AGREEMENT. REPURCHASE AGREEMENTS ARE NOT, HOWEVER,
WITHOUT RISK.
IN THE EVENT OF THE BANKRUPTCY OF A SELLER DURING THE TERM OF A REPURCHASE
AGREEMENT, A LEGAL QUESTION EXISTS AS TO WHETHER THE FUND WOULD BE DEEMED THE
OWNER OF THE UNDERLYING SECURITY OR WOULD BE DEEMED ONLY TO HAVE A SECURITY
INTEREST IN AND LIEN UPON SUCH SECURITY. THE FUND WILL ONLY ENGAGE IN REPURCHASE
AGREEMENTS WITH RECOGNIZED SECURITIES DEALERS AND BANKS DETERMINED TO PRESENT
MINIMAL CREDIT RISK BY CAMCO. REPURCHASE AGREEMENTS ARE ALWAYS FOR PERIODS OF
LESS THAN ONE YEAR AND ARE SUBJECT TO LIMITATIONS ON ILLIQUID SECURITIES.
IN ADDITION, THE FUND WILL ONLY ENGAGE IN REPURCHASE AGREEMENTS REASONABLY
DESIGNED TO SECURE FULLY DURING THE TERM OF THE AGREEMENT THE SELLER'S
OBLIGATION TO REPURCHASE THE UNDERLYING SECURITY AND WILL MONITOR THE MARKET
VALUE OF THE UNDERLYING SECURITY DURING THE TERM OF THE AGREEMENT. IF THE VALUE
OF THE UNDERLYING SECURITY DECLINES AND IS NOT AT LEAST EQUAL TO THE REPURCHASE
PRICE DUE THE FUND PURSUANT TO THE AGREEMENT, THE FUND WILL REQUIRE THE SELLER
TO PLEDGE ADDITIONAL SECURITIES OR CASH TO SECURE THE SELLER'S OBLIGATIONS
PURSUANT TO THE AGREEMENT. IF THE SELLER DEFAULTS ON ITS OBLIGATION TO
REPURCHASE AND THE VALUE OF THE UNDERLYING SECURITY DECLINES, THE FUND MAY INCUR
A LOSS AND MAY INCUR EXPENSES IN SELLING THE UNDERLYING SECURITY.
REVERSE REPURCHASE AGREEMENTS
THE FUND MAY ALSO ENGAGE IN REVERSE REPURCHASE AGREEMENTS. UNDER A REVERSE
REPURCHASE AGREEMENT, THE FUND SELLS ITS SECURITIES TO A BANK OR SECURITIES
DEALER AND AGREES TO REPURCHASE THOSE SECURITIES FROM SUCH PARTY AT AN AGREED
UPON DATE AND PRICE REFLECTING A MARKET RATE OF INTEREST. THE FUND INVESTS THE
PROCEEDS FROM EACH REVERSE REPURCHASE AGREEMENT IN OBLIGATIONS IN WHICH IT IS
AUTHORIZED TO INVEST. THE FUND INTENDS TO ENTER INTO A REVERSE REPURCHASE
AGREEMENT ONLY WHEN THE INTEREST INCOME PROVIDED FOR IN THE OBLIGATION IN WHICH
THE FUND INVESTS THE PROCEEDS IS EXPECTED TO EXCEED THE AMOUNT THE FUND WILL PAY
IN INTEREST TO THE OTHER PARTY TO THE AGREEMENT, PLUS ALL COSTS ASSOCIATED WITH
THE TRANSACTIONS. THE FUND DOES NOT INTEND TO BORROW FOR LEVERAGE PURPOSES. THE
FUND WILL ONLY BE PERMITTED TO PLEDGE ASSETS TO THE EXTENT NECESSARY TO SECURE
BORROWINGS AND REVERSE REPURCHASE AGREEMENTS.
DURING THE TIME A REVERSE REPURCHASE AGREEMENT IS OUTSTANDING, THE FUND
WILL MAINTAIN IN A SEGREGATED CUSTODIAL ACCOUNT AN AMOUNT OF CASH, U.S.
GOVERNMENT SECURITIES OR OTHER LIQUID, HIGH-QUALITY DEBT SECURITIES EQUAL IN
VALUE TO THE REPURCHASE PRICE. THE FUND WILL MARK TO MARKET THE VALUE OF ASSETS
HELD IN THE SEGREGATED ACCOUNT, AND WILL PLACE ADDITIONAL ASSETS IN THE ACCOUNT
WHENEVER THE TOTAL VALUE OF THE ACCOUNT FALLS BELOW THE AMOUNT REQUIRED UNDER
APPLICABLE REGULATIONS.
THE FUND'S USE OF REVERSE REPURCHASE AGREEMENTS INVOLVES THE RISK THAT THE
OTHER PARTY TO THE AGREEMENTS COULD BECOME SUBJECT TO BANKRUPTCY OR LIQUIDATION
PROCEEDINGS DURING THE PERIOD THE AGREEMENTS ARE OUTSTANDING. IN SUCH EVENT, THE
FUND MAY NOT BE ABLE TO REPURCHASE THE SECURITIES IT HAS SOLD TO THAT OTHER
PARTY. UNDER THOSE CIRCUMSTANCES, IF AT THE EXPIRATION OF THE AGREEMENT SUCH
SECURITIES ARE OF GREATER VALUE THAN THE PROCEEDS OBTAINED BY THE FUND UNDER THE
AGREEMENTS, THE FUND MAY HAVE BEEN BETTER OFF HAD IT NOT ENTERED INTO THE
AGREEMENT. HOWEVER, THE FUND WILL ENTER INTO REVERSE REPURCHASE AGREEMENTS ONLY
WITH BANKS AND DEALERS WHICH CAMCO BELIEVES PRESENT MINIMAL CREDIT RISKS UNDER
GUIDELINES ADOPTED BY THE FUND'S BOARD OF TRUSTEES. IN ADDITION, THE FUND BEARS
THE RISK THAT THE MARKET VALUE OF THE SECURITIES SOLD BY THE FUND MAY DECLINE
BELOW THE AGREED-UPON REPURCHASE PRICE, IN WHICH CASE THE DEALER MAY REQUEST THE
FUND TO POST ADDITIONAL COLLATERAL.
INTERNATIONAL MONEY MARKET INSTRUMENTS
THE FUND MAY INVEST IN U.S. DOLLAR-DENOMINATED OBLIGATIONS OF FOREIGN
BRANCHES OF U.S. BANKS AND U.S. BRANCHES OF FOREIGN BANKS ("BANK OBLIGATIONS").
SUCH BANK OBLIGATIONS MAY BE SUBJECT TO RISKS NOT ASSOCIATED WITH DOMESTICALLY
INSURED BANK OBLIGATIONS. FOR EXAMPLE, FOREIGN AND DOMESTIC BANK RESERVE
REQUIREMENTS MAY DIFFER.
THE FUND MAY ALSO INVEST IN COMMERCIAL PAPER, SHORT-TERM CORPORATE
OBLIGATIONS, AND OBLIGATIONS ISSUED OR GUARANTEED BY FOREIGN GOVERNMENTS, THEIR
AGENCIES AND INSTRUMENTALITIES, OR BY INTERNATIONAL AGENCIES AND
INSTRUMENTALITIES, SO LONG AS SUCH INSTRUMENTS ARE U.S. DOLLAR-DENOMINATED AND
MEET THE SAME CREDIT, LIQUIDITY, AND CONCENTRATION REQUIREMENTS AS DOMESTIC
OBLIGATIONS.
THE BANK OBLIGATIONS AND OTHER MONEY MARKET INSTRUMENTS OF FOREIGN ISSUERS
DESCRIBED ABOVE ARE SUBJECT TO CERTAIN ADDITIONAL RISKS. PAYMENT OF INTEREST AND
PRINCIPAL UPON THESE OBLIGATIONS AND THE MARKETABILITY AND LIQUIDITY OF SUCH
OBLIGATIONS IN THE SECONDARY MARKET MAY ALSO BE ADVERSELY AFFECTED BY
GOVERNMENTAL ACTION IN THE COUNTRY OF DOMICILE OF THE BRANCH (GENERALLY REFERRED
TO AS "SOVEREIGN RISK"). EXAMPLES OF GOVERNMENTAL ACTIONS WOULD BE THE
IMPOSITION OF EXCHANGE OR CURRENCY CONTROLS, INTEREST LIMITATIONS OR WITHHOLDING
TAXES ON INTEREST INCOME, SEIZURE OF ASSETS, OR THE DECLARATION OF A MORATORIUM
ON THE PAYMENT OF PRINCIPAL OR INTEREST. IN ADDITION, EVIDENCES OF OWNERSHIP OF
FUND SECURITIES MAY BE HELD OUTSIDE OF THE U.S., AND THE FUND MAY BE SUBJECT TO
THE RISKS ASSOCIATED WITH THE HOLDING OF SUCH PROPERTY OVERSEAS.
OBLIGATIONS WITH PUTS ATTACHED
THE FUND HAS AUTHORITY TO PURCHASE SECURITIES AT A PRICE WHICH WOULD RESULT
IN A YIELD TO MATURITY LOWER THAN THAT GENERALLY OFFERED BY THE SELLER AT THE
TIME OF PURCHASE WHEN IT CAN ACQUIRE AT THE SAME TIME THE RIGHT TO SELL THE
SECURITIES BACK TO THE SELLER AT AN AGREED UPON PRICE AT ANY TIME DURING A
STATED PERIOD OR ON A CERTAIN DATE. SUCH A RIGHT IS GENERALLY DENOTED AS A
"PUT."
WHEN-ISSUED PURCHASES
SECURITIES PURCHASED ON A WHEN-ISSUED BASIS AND THE SECURITIES HELD IN THE
FUND ARE SUBJECT TO CHANGES IN MARKET VALUE BASED UPON THE PUBLIC'S PERCEPTION
OF THE CREDITWORTHINESS OF THE ISSUER AND CHANGES IN THE LEVEL OF INTEREST RATES
(WHICH WILL GENERALLY RESULT IN BOTH CHANGING IN VALUE IN THE SAME WAY, I.E.,
BOTH EXPERIENCING APPRECIATION WHEN INTEREST RATES DECLINE AND DEPRECIATION WHEN
INTEREST RATES RISE). THEREFORE, IF IN ORDER TO ACHIEVE HIGHER INTEREST INCOME,
THE FUND REMAINS SUBSTANTIALLY FULLY INVESTED AT THE SAME TIME THAT IT HAS
PURCHASED SECURITIES ON A WHEN-ISSUED BASIS, THERE WILL BE A GREATER POSSIBILITY
THAT THE MARKET VALUE OF THE FUND'S ASSETS MAY VARY. NO NEW WHEN-ISSUED
COMMITMENTS WILL BE MADE BY A FUND IF MORE THAN 50% OF THAT FUND'S NET ASSETS
WOULD BECOME SO COMMITTED.
WHEN THE TIME COMES TO PAY FOR WHEN-ISSUED SECURITIES, THE FUND WILL MEET
ITS OBLIGATIONS FROM THEN AVAILABLE CASH FLOW, SALE OF SECURITIES OR, ALTHOUGH
IT WOULD NOT NORMALLY EXPECT TO DO SO, FROM SALE OF THE WHEN-ISSUED SECURITIES
THEMSELVES (WHICH MAY HAVE A MARKET VALUE GREATER OR LESS THAN THE FUND'S
PAYMENT OBLIGATION). SALE OF SECURITIES TO MEET SUCH OBLIGATIONS CARRIES WITH IT
A GREATER POTENTIAL FOR THE REALIZATION OF CAPITAL LOSSES AND CAPITAL GAINS
WHICH ARE NOT EXEMPT FROM FEDERAL INCOME TAX.
INVESTMENT RESTRICTIONS
-----------------------
FUNDAMENTAL INVESTMENT RESTRICTIONS
THE FUND HAS ADOPTED THE FOLLOWING FUNDAMENTAL INVESTMENT RESTRICTIONS.
THESE RESTRICTIONS CANNOT BE CHANGED WITHOUT THE APPROVAL OF THE HOLDERS OF A
MAJORITY OF THE OUTSTANDING SHARES OF THE FUND.
(1) THE FUND MAY NOT MAKE ANY INVESTMENT INCONSISTENT WITH ITS CLASSIFICATION AS
A DIVERSIFIED INVESTMENT COMPANY UNDER THE 1940 ACT.
(2) THE FUND MAY NOT CONCENTRATE ITS INVESTMENTS IN THE SECURITIES OF ISSUERS
PRIMARILY ENGAGED IN ANY PARTICULAR INDUSTRY (OTHER THAN SECURITIES ISSUED OR
GUARANTEED BY THE U.S. GOVERNMENT OR ITS AGENCIES OR INSTRUMENTALITIES AND
REPURCHASE AGREEMENTS SECURED THEREBY), OR DOMESTIC BANK MONEY MARKET
INSTRUMENTS.
(3) THE FUND MAY NOT ISSUE SENIOR SECURITIES OR BORROW MONEY, EXCEPT FROM BANKS
FOR TEMPORARY OR EMERGENCY PURPOSES AND THEN ONLY IN AN AMOUNT UP TO 33 1/3% OF
THE VALUE OF ITS TOTAL ASSETS OR AS PERMITTED BY LAW AND EXCEPT BY ENGAGING IN
REVERSE REPURCHASE AGREEMENTS, WHERE ALLOWED. IN ORDER TO SECURE ANY PERMITTED
BORROWINGS AND REVERSE REPURCHASE AGREEMENTS UNDER THIS SECTION, THE FUND MAY
PLEDGE, MORTGAGE OR HYPOTHECATE ITS ASSETS.
(4) THE FUND MAY NOT UNDERWRITE THE SECURITIES OF OTHER ISSUERS, EXCEPT AS
ALLOWED BY LAW OR TO THE EXTENT THAT THE PURCHASE OF OBLIGATIONS IN ACCORDANCE
WITH ITS INVESTMENT OBJECTIVE AND POLICIES, EITHER DIRECTLY FROM THE ISSUER, OR
FROM AN UNDERWRITER FOR AN ISSUER, MAY BE DEEMED AN UNDERWRITING.
(5) THE FUND MAY NOT INVEST DIRECTLY IN COMMODITIES OR REAL ESTATE, ALTHOUGH IT
MAY INVEST IN SECURITIES WHICH ARE SECURED BY REAL ESTATE OR REAL ESTATE
MORTGAGES AND SECURITIES OF ISSUERS WHICH INVEST OR DEAL IN COMMODITIES,
COMMODITY FUTURES, REAL ESTATE OR REAL ESTATE MORTGAGES.
(6) THE FUND MAY NOT MAKE LOANS, OTHER THAN THROUGH THE PURCHASE OF MONEY MARKET
INSTRUMENTS AND REPURCHASE AGREEMENTS OR BY THE PURCHASE OF BONDS, DEBENTURES OR
OTHER DEBT SECURITIES, OR AS PERMITTED BY LAW. THE PURCHASE OF ALL OR A PORTION
OF AN ISSUE OF PUBLICLY OR PRIVATELY DISTRIBUTED DEBT OBLIGATIONS IN ACCORDANCE
WITH THE FUND'S INVESTMENT OBJECTIVE, POLICIES AND RESTRICTIONS, SHALL NOT
CONSTITUTE THE MAKING OF A LOAN.
NONFUNDAMENTAL INVESTMENT RESTRICTIONS
THE BOARD OF TRUSTEES HAS ADOPTED THE FOLLOWING NONFUNDAMENTAL INVESTMENT
RESTRICTIONS. A NONFUNDAMENTAL INVESTMENT RESTRICTION CAN BE CHANGED BY THE
BOARD AT ANY TIME WITHOUT A SHAREHOLDER VOTE.
(1) THE FUND MAY ONLY ENGAGE IN REVERSE REPURCHASE AGREEMENTS SO LONG AS, AT THE
TIME IT ENTERS INTO A REVERSE REPURCHASE AGREEMENT, THE AGGREGATE PROCEEDS FROM
OUTSTANDING REVERSE REPURCHASE AGREEMENTS, WHEN ADDED TO OTHER OUTSTANDING
BORROWINGS, DO NOT EXCEED 33 1/3% OF ITS TOTAL ASSETS. THE FUND DOES NOT INTEND
TO MAKE ANY PURCHASES OF SECURITIES IF BORROWING EXCEEDS 5% OF TOTAL ASSETS.
(2) THE FUND MAY NOT PURCHASE COMMON STOCKS, PREFERRED STOCKS, WARRANTS, OR
OTHER EQUITY SECURITIES.
(3) NO MORE THAN 10% OF THE FUND'S NET ASSETS MAY BE INVESTED IN ILLIQUID
SECURITIES.
(4) THE FUND MAY NOT SELL SECURITIES SHORT.
(5) THE FUND MAY NOT WRITE OR PURCHASE PUT OR CALL OPTIONS.
PURCHASE AND REDEMPTION OF SHARES
---------------------------------
THE FUND REQUIRES A MINIMUM INITIAL INVESTMENT OF $1,000,000. SHARES WILL
BE HELD IN BOOK ENTRY FORM AT THE FUND'S TRANSFER AGENT. NO SHARE CERTIFICATES
WILL BE ISSUED.
AMOUNTS REDEEMED BY CHECK REDEMPTION MAY BE MAILED TO THE INVESTOR WITHOUT
CHARGE. AMOUNTS OF $50,000 OR MORE WILL BE TRANSMITTED BY WIRE WITHOUT CHARGE BY
THE FUND TO THE INVESTOR'S ACCOUNT AT A DOMESTIC COMMERCIAL BANK THAT IS A
MEMBER OF THE FEDERAL RESERVE SYSTEM OR TO A CORRESPONDENT BANK. A CHARGE OF $5
MAY BE IMPOSED ON WIRE TRANSFERS OF LESS THAN $50,000. IF THE INVESTOR'S BANK IS
NOT A FEDERAL RESERVE SYSTEM MEMBER, FAILURE OF IMMEDIATE NOTIFICATION TO THAT
BANK BY THE CORRESPONDENT BANK COULD RESULT IN A DELAY IN CREDITING THE FUNDS TO
THE INVESTOR'S BANK ACCOUNT.
EXISTING SHAREHOLDERS WHO AT ANY TIME DESIRE TO CHANGE INSTRUCTIONS ALREADY
GIVEN MUST SEND A NOTICE EITHER TO THE BROKER THROUGH WHICH SHARES WERE
PURCHASED OR TO THE FUND WITH A VOIDED CHECK FROM THE BANK ACCOUNT TO RECEIVE
THE REDEMPTION PROCEEDS. NEW WIRING INSTRUCTIONS MAY BE ACCOMPANIED BY A VOIDED
CHECK IN LIEU OF A SIGNATURE GUARANTEE. IF A VOIDED CHECK DOES NOT ACCOMPANY THE
REQUEST, THEN THE REQUEST MUST BE SIGNATURE GUARANTEED BY A COMMERCIAL BANK,
SAVINGS AND LOAN ASSOCIATION, TRUST COMPANY, MEMBER FIRM OF ANY NATIONAL
SECURITIES EXCHANGE, OR CREDIT UNION. FURTHER DOCUMENTATION, SUCH AS A CORPORATE
RESOLUTION, IS REQUIRED FROM CORPORATIONS, FIDUCIARIES, PENSION PLANS, AND
INSTITUTIONAL INVESTORS.
THE FUND'S REDEMPTION CHECK NORMALLY WILL BE MAILED TO THE INVESTOR ON THE
NEXT BUSINESS DAY FOLLOWING THE DATE OF RECEIPT BY THE FUND OF THE WRITTEN OR
TELEPHONE REDEMPTION REQUEST. IF THE INVESTOR SO INSTRUCTS IN THE REDEMPTION
REQUEST, THE CHECK WILL BE MAILED OR THE REDEMPTION PROCEEDS WIRED TO A
PREDESIGNATED ACCOUNT AT THE INVESTOR'S BANK.
THE RIGHT OF REDEMPTION MAY BE SUSPENDED OR THE DATE OF PAYMENT POSTPONED
FOR ANY PERIOD DURING WHICH THE NEW YORK STOCK EXCHANGE IS CLOSED (OTHER THAN
CUSTOMARY WEEKEND AND HOLIDAY CLOSINGS), WHEN TRADING ON THE NEW YORK STOCK
EXCHANGE IS RESTRICTED, OR AN EMERGENCY EXISTS, AS DETERMINED BY THE SEC, OR IF
THE COMMISSION HAS ORDERED SUCH A SUSPENSION FOR THE PROTECTION OF SHAREHOLDERS.
REDEMPTION PROCEEDS ARE NORMALLY MAILED OR WIRED THE NEXT BUSINESS DAY AFTER A
PROPER REDEMPTION REQUEST HAS BEEN RECEIVED, UNLESS REDEMPTIONS HAVE BEEN
SUSPENDED OR POSTPONED AS DESCRIBED ABOVE.
DIVIDENDS AND TAXES
-------------------
THE FUND DECLARES DIVIDENDS DAILY AND PAYS THEM MONTHLY, BASED ON ITS NET
INVESTMENT INCOME. NET INVESTMENT INCOME CONSISTS OF THE INTEREST INCOME EARNED
ON INVESTMENTS (ADJUSTED FOR AMORTIZATION OF ORIGINAL ISSUE OR MARKET DISCOUNT
OR PREMIUM), LESS EXPENSES. REALIZED AND UNREALIZED GAINS AND LOSSES ARE NOT
INCLUDED IN NET INVESTMENT INCOME. NET SHORT-TERM CAPITAL GAINS WILL BE
DISTRIBUTED ONCE EACH YEAR, ALTHOUGH THE FUND MAY DISTRIBUTE THEM MORE
FREQUENTLY IF NECESSARY IN ORDER TO MAINTAIN NET ASSET VALUE AT $1.00 PER SHARE.
DISTRIBUTIONS OF NET CAPITAL GAINS, IF ANY, ARE NORMALLY DECLARED AND PAID BY
THE FUND ONCE A YEAR; HOWEVER, THE FUND DOES NOT INTEND TO MAKE ANY SUCH
DISTRIBUTIONS FROM SECURITIES PROFITS UNLESS AVAILABLE LOSS CARRYOVERS, IF ANY,
HAVE BEEN USED OR HAVE EXPIRED.
IN 1999 THE FUND DID QUALIFY AND IN 2000 THE FUND INTENDS TO QUALIFY AS A
"REGULATED INVESTMENT COMPANY" UNDER SUBCHAPTER M OF THE INTERNAL REVENUE CODE
AS AMENDED. BY SO QUALIFYING, THE FUND WILL NOT BE SUBJECT TO FEDERAL INCOME
TAXES, NOR TO THE FEDERAL EXCISE TAX IMPOSED BY THE TAX REFORM ACT OF 1986, TO
THE EXTENT THAT IT DISTRIBUTES ITS NET INVESTMENT INCOME AND REALIZED CAPITAL
GAINS.
DIVIDENDS AND DISTRIBUTIONS ARE AUTOMATICALLY REINVESTED AT NET ASSET VALUE
IN ADDITIONAL SHARES. SHAREHOLDERS MAY ELECT TO HAVE THEIR DIVIDENDS AND
DISTRIBUTIONS PAID OUT MONTHLY OR QUARTERLY IN CASH. THE FUND'S DIVIDENDS OF NET
INVESTMENT INCOME AND DIVIDENDS OF NET SHORT-TERM CAPITAL GAINS, WHETHER TAKEN
IN CASH OR REINVESTED IN ADDITIONAL SHARES, ARE TAXABLE TO SHAREHOLDERS AS
ORDINARY INCOME AND MAY QUALIFY FOR THE CORPORATE DIVIDENDS-RECEIVED DEDUCTION.
NET LONG-TERM CAPITAL GAIN DISTRIBUTIONS, IF ANY, WILL GENERALLY BE INCLUDABLE
AS LONG-TERM CAPITAL GAIN IN THE GROSS INCOME OF SHAREHOLDERS WHO ARE CITIZENS
OR RESIDENTS OF THE UNITED STATES. WHETHER SUCH REALIZED SECURITIES GAINS AND
LOSSES ARE LONG- OR SHORT-TERM DEPENDS ON THE PERIOD THE SECURITIES ARE HELD BY
THE FUND, NOT THE PERIOD FOR WHICH THE SHAREHOLDER HOLDS SHARES OF THE FUND.
THE FUND WILL NOTIFY SHAREHOLDERS ANNUALLY ABOUT THE TAX STATUS OF
DIVIDEND AND DISTRIBUTIONS PAID BY THE FUND AND THE AMOUNT OF DIVIDENDS
WITHHELD, IF ANY, DURING THE PREVIOUS YEAR. MANY STATES DO NOT TAX THE PORTION
OF A FUND'S DIVIDENDS WHICH IS DERIVED FROM INTEREST ON U.S. GOVERNMENT
OBLIGATIONS. STATE LAW VARIES CONSIDERABLY CONCERNING THE TAX STATUS OF
DIVIDENDS DERIVED FROM U.S. GOVERNMENT OBLIGATIONS. ACCORDINGLY, SHAREHOLDERS
SHOULD CONSULT THEIR TAX ADVISORS ABOUT THE TAX STATUS OF DIVIDENDS AND
DISTRIBUTIONS FROM THE FUND IN THEIR RESPECTIVE JURISDICTIONS.
THE FUND IS REQUIRED TO WITHHOLD 31% OF ANY DIVIDENDS AND ANY LONG-TERM
CAPITAL GAIN DIVIDENDS, PAID IF: (A) THE SHAREHOLDER'S SOCIAL SECURITY NUMBER OR
OTHER TAXPAYER IDENTIFICATION NUMBER ("TIN") IS NOT PROVIDED OR AN OBVIOUSLY
INCORRECT TIN IS PROVIDED: (B) THE SHAREHOLDER DOES NOT CERTIFY UNDER PENALTIES
OF PERJURY THAT THE TIN PROVIDED IS THE SHAREHOLDER'S CORRECT TIN AND THAT THE
SHAREHOLDER IS NOT SUBJECT TO BACKUP WITHHOLDING UNDER SECTION 3406(A)(1)(C) OF
THE INTERNAL REVENUE CODE BECAUSE OF UNDERREPORTING; OR (C) THE FUND IS NOTIFIED
BY THE INTERNAL REVENUE SERVICE THAT THE TIN PROVIDED BY THE SHAREHOLDER IS
INCORRECT OR THAT THERE HAS BEEN UNDERREPORTING OF INTEREST OR DIVIDENDS BY THE
SHAREHOLDER. AFFECTED SHAREHOLDERS WILL RECEIVE STATEMENTS AT LEAST ANNUALLY
SPECIFYING THE AMOUNT OF DIVIDENDS WITHHELD. SHAREHOLDERS EXEMPT FROM BACKUP
WITHHOLDING INCLUDE: CORPORATIONS; FINANCIAL INSTITUTIONS; TAX EXEMPT
ORGANIZATIONS; INDIVIDUAL RETIREMENT PLANS; THE U.S., A STATE, THE DISTRICT OF
COLUMBIA, A U.S. POSSESSION, A FOREIGN GOVERNMENT, AN INTERNATIONAL
ORGANIZATION, OR ANY POLITICAL SUBDIVISION, AGENCY OR INSTRUMENTALITY OF ANY OF
THE FOREGOING; U.S. REGISTERED COMMODITIES OR SECURITIES DEALERS; REAL ESTATE
INVESTMENT TRUSTS; REGISTERED INVESTMENT COMPANIES; BANK COMMON TRUST FUNDS;
CERTAIN CHARITABLE TRUSTS; AND FOREIGN CENTRAL BANKS OF ISSUE. NON-RESIDENT
ALIENS ALSO ARE GENERALLY NOT SUBJECT TO BACKUP WITHHOLDING BUT, ALONG WITH
CERTAIN FOREIGN PARTNERSHIPS AND FOREIGN CORPORATIONS, MAY INSTEAD BE SUBJECT TO
WITHHOLDING UNDER SECTION 1441 OF THE INTERNAL REVENUE CODE. SHAREHOLDERS
CLAIMING EXEMPTION FROM BACKUP WITHHOLDING SHOULD CALL OR WRITE THE FUND FOR
FURTHER INFORMATION.
VALUATION OF SHARES
-------------------
THE NET ASSET VALUE PER SHARE, THE PRICE AT WHICH SHARES ARE CONTINUOUSLY
ISSUED AND REDEEMED, IS COMPUTED BY DIVIDING THE VALUE OF THE FUND'S TOTAL
ASSETS, LESS ITS LIABILITIES, BY THE TOTAL NUMBER OF SHARES OUTSTANDING. THE
FUND'S NET ASSET VALUE IS DETERMINED EVERY BUSINESS DAY AT THE CLOSE OF THE
REGULAR SESSION OF THE NEW YORK STOCK EXCHANGE (GENERALLY, 4:00 P.M. EASTERN
TIME). THE FUNDS DO NOT DETERMINE NET ASSET VALUE ON CERTAIN NATIONAL HOLIDAYS
OR OTHER DAYS ON WHICH THE NEW YORK STOCK EXCHANGE IS CLOSED: NEW YEAR'S DAY,
MARTIN LUTHER KING DAY, PRESIDENTS' DAY, GOOD FRIDAY, MEMORIAL DAY, INDEPENDENCE
DAY, LABOR DAY, THANKSGIVING DAY, AND CHRISTMAS DAY.
THE FUND'S ASSETS, INCLUDING COMMITMENTS TO PURCHASE SECURITIES ON A
WHEN-ISSUED BASIS, ARE VALUED AT THEIR AMORTIZED COST WHICH DOES NOT TAKE INTO
ACCOUNT UNREALIZED CAPITAL GAINS OR LOSSES. THIS INVOLVES VALUING AN INSTRUMENT
AT ITS COST AND THEREAFTER ASSUMING A CONSTANT AMORTIZATION TO MATURITY OF ANY
DISCOUNT OR PREMIUM, REGARDLESS OF THE IMPACT OF FLUCTUATING INTEREST RATES ON
THE MARKET VALUE OF THE INSTRUMENT. WHILE THIS METHOD PROVIDES CERTAINTY IN
VALUATION, IT MAY RESULT IN PERIODS DURING WHICH VALUE, AS DETERMINED BY
AMORTIZED COST, IS HIGHER OR LOWER THAN THE PRICE THAT WOULD BE RECEIVED UPON
SALE OF THE INSTRUMENT. DURING PERIODS OF DECLINING INTEREST RATES, THE DAILY
YIELD ON SHARES OF A FUND MAY TEND TO BE HIGHER THAN A LIKE COMPUTATION MADE BY
A FUND WITH IDENTICAL INVESTMENTS UTILIZING A METHOD OF VALUATION BASED UPON
MARKET PRICES AND ESTIMATES OF MARKET PRICES FOR ALL OF ITS FUND INSTRUMENTS.
THUS, IF THE USE OF AMORTIZED COST BY A FUND RESULTED IN A LOWER AGGREGATE FUND
VALUE ON A PARTICULAR DAY, A PROSPECTIVE INVESTOR IN THE FUND WOULD BE ABLE TO
OBTAIN A SOMEWHAT HIGHER YIELD THAN WOULD RESULT FROM INVESTMENT IN A FUND
UTILIZING SOLELY MARKET VALUES, AND EXISTING INVESTORS IN THE FUND WOULD RECEIVE
LESS INVESTMENT INCOME. THE CONVERSE WOULD APPLY IN A PERIOD OF RISING INTEREST
RATES.
CALCULATION OF YIELD
--------------------
FROM TIME TO TIME, THE FUND ADVERTISES "YIELD" AND "EFFECTIVE YIELD." BOTH
YIELD FIGURES ARE BASED ON HISTORICAL EARNINGS AND ARE NOT INTENDED TO INDICATE
FUTURE PERFORMANCE. THE "YIELD" REFERS TO THE ACTUAL INCOME GENERATED BY AN
INVESTMENT IN THE FUND OVER A PARTICULAR BASE PERIOD OF TIME. THE LENGTH AND
CLOSING DATE OF THE BASE PERIODS WILL BE STATED IN THE ADVERTISEMENT. IF THE
BASE PERIOD IS LESS THAN ONE YEAR, THE YIELD IS THEN "ANNUALIZED." THAT IS, THE
NET CHANGE, EXCLUSIVE OF CAPITAL CHANGES, IN THE VALUE OF A SHARE DURING THE
BASE PERIOD IS DIVIDED BY THE NET ASSET VALUE PER SHARE AT THE BEGINNING OF THE
PERIOD, AND THE RESULT IS MULTIPLIED BY 365 AND DIVIDED BY THE NUMBER OF DAYS IN
THE BASE PERIOD. CAPITAL CHANGES EXCLUDED FROM THE CALCULATION OF YIELD ARE: (1)
REALIZED GAINS AND LOSSES FROM THE SALE OF SECURITIES, AND (2) UNREALIZED
APPRECIATION AND DEPRECIATION. A FUND'S "EFFECTIVE YIELD" FOR A SEVEN-DAY PERIOD
IS ITS ANNUALIZED COMPOUNDED AVERAGE YIELD DURING THE PERIOD, CALCULATED
ACCORDING TO THE FOLLOWING FORMULA:
EFFECTIVE YIELD = [(BASE PERIOD RETURN) + 1]365/7 - 1
FROM TIME TO TIME, THE FUND MAY PROVIDE, FOR A GIVEN PERIOD, QUOTATIONS OF
DIVIDEND YIELD TO SHAREHOLDERS OR PROSPECTIVE INVESTORS. FOR THE SEVEN-DAY
PERIOD ENDED SEPTEMBER 30, 1999, THE YIELD AND EFFECTIVE YIELD WERE 5.41% AND
5.56%, RESPECTIVELY.
ADVERTISING
-----------
THE FUND OR ITS AFFILIATES MAY PROVIDE INFORMATION SUCH AS, BUT NOT LIMITED
TO, THE ECONOMY, INVESTMENT CLIMATE, INVESTMENT PRINCIPLES, SOCIOLOGICAL
CONDITIONS AND POLITICAL AMBIANCE. DISCUSSION MAY INCLUDE HYPOTHETICAL SCENARIOS
OR LISTS OF RELEVANT FACTORS DESIGNED TO AID THE INVESTOR IN DETERMINING WHETHER
THE FUND IS COMPATIBLE WITH THE INVESTOR'S GOALS. THE FUND MAY LIST FUND
HOLDINGS OR GIVE EXAMPLES OR SECURITIES THAT MAY HAVE BEEN CONSIDERED FOR
INCLUSION IN THE FUND, WHETHER HELD OR NOT.
THE FUND OR ITS AFFILIATES MAY SUPPLY COMPARATIVE PERFORMANCE DATA AND
RANKINGS FROM INDEPENDENT SOURCES SUCH AS DONOGHUE'S MONEY FUND REPORT, BANK
RATE MONITOR, MONEY, FORBES, LIPPER ANALYTICAL SERVICES, INC., CDA INVESTMENT
TECHNOLOGIES, INC., WIESENBERGER INVESTMENT COMPANIES SERVICE, MUTUAL FUND
VALUES MORNINGSTAR RATINGS, MUTUAL FUND FORECASTER, BARRON'S, AND THE WALL
STREET JOURNAL. THE FUND MAY ALSO CITE TO ANY SOURCE, WHETHER IN PRINT OR
ON-LINE, SUCH AS BLOOMBERG, IN ORDER TO ACKNOWLEDGE ORIGIN OF INFORMATION. THE
FUND MAY COMPARE ITSELF OR ITS FUND HOLDINGS TO OTHER INVESTMENTS, WHETHER OR
NOT ISSUED OR REGULATED BY THE SECURITIES INDUSTRY, INCLUDING, BUT NOT LIMITED
TO, CERTIFICATES OF DEPOSIT AND TREASURY NOTES. THE FUND, ITS ADVISOR, AND ITS
AFFILIATES RESERVE THE RIGHT TO UPDATE PERFORMANCE RANKINGS AS NEW RANKINGS
BECOME AVAILABLE.
CALVERT GROUP IS THE LEADING FAMILY OF SOCIALLY RESPONSIBLE MUTUAL FUNDS,
BOTH IN TERMS OF SOCIALLY RESPONSIBLE MUTUAL FUND ASSETS UNDER MANAGEMENT, AND
NUMBER OF SOCIALLY RESPONSIBLE MUTUAL FUND PORTFOLIOS OFFERED (SOURCE: SOCIAL
INVESTMENT FORUM, DECEMBER 31, 1999). CALVERT GROUP WAS ALSO THE FIRST TO OFFER
A FAMILY OF SOCIALLY RESPONSIBLE MUTUAL FUND PORTFOLIOS.
TRUSTEES AND OFFICERS
---------------------
RICHARD L. BAIRD, JR., TRUSTEE. MR. BAIRD IS EXECUTIVE VICE PRESIDENT FOR
THE FAMILY HEALTH COUNCIL, INC. IN PITTSBURGH, PENNSYLVANIA, A NON-PROFIT
CORPORATION WHICH PROVIDES FAMILY PLANNING SERVICES, NUTRITION, MATERNAL/CHILD
HEALTH CARE, AND VARIOUS HEALTH SCREENING SERVICES. MR. BAIRD IS A
TRUSTEE/DIRECTOR OF EACH OF THE INVESTMENT COMPANIES IN THE CALVERT GROUP OF
FUNDS, EXCEPT FOR CALVERT VARIABLE SERIES, INC., CALVERT NEW WORLD FUND, INC.
AND CALVERT WORLD VALUES FUND, INC. DOB: 05/09/48. ADDRESS: 211 OVERLOOK DRIVE,
PITTSBURGH, PENNSYLVANIA 15216.
FRANK H. BLATZ, JR., ESQ., TRUSTEE. MR. BLATZ IS A PARTNER IN THE LAW FIRM
OF SNEVILY, ELY, WILLIAMS & BLATZ. HE WAS FORMERLY A PARTNER WITH ABRAMS, BLATZ,
GRAN, HENDRICKS & REINA, P.A. HE IS ALSO A DIRECTOR OF CALVERT VARIABLE SERIES,
INC. DOB: 10/29/35. ADDRESS: 282 SOUTH AVE., SUITE 201, P.O. BOX 207 FANWOOD, NJ
07023.
FREDERICK T. BORTS, M.D., TRUSTEE. DR. BORTS IS A RADIOLOGIST WITH KAISER
PERMANENTE. PRIOR TO THAT, HE WAS A RADIOLOGIST AT BETHLEHEM MEDICAL IMAGING IN
ALLENTOWN, PENNSYLVANIA. DOB: 07/23/49. ADDRESS: 2610 NONOHE STREET, WAHIAWI, HI
96786.
CHARLES E. DIEHL, TRUSTEE. MR. DIEHL IS A SELF-EMPLOYED CONSULTANT AND IS
VICE PRESIDENT AND TREASURER EMERITUS OF THE GEORGE WASHINGTON UNIVERSITY. HE
HAS RETIRED FROM UNIVERSITY SUPPORT SERVICES, INC. OF HERNDON, VIRGINIA.
FORMERLY, HE WAS A DIRECTOR OF ACACIA MUTUAL LIFE INSURANCE COMPANY, AND IS
CURRENTLY A DIRECTOR OF SERVUS FINANCIAL CORPORATION. DOB: 10/13/22. ADDRESS:
1658 QUAIL HOLLOW COURT, MCLEAN, VIRGINIA 22101.
DOUGLAS E. FELDMAN, M.D., TRUSTEE. DR. FELDMAN IS MANAGING PARTNER OF
FELDMAN OTOLARYNGOLOGY, HEAD AND NECK SURGERY IN WASHINGTON, D.C. A GRADUATE OF
HARVARD MEDICAL SCHOOL, HE IS ASSOCIATE PROFESSOR OF OTOLARYNGOLOGY, HEAD AND
NECK SURGERY AT GEORGETOWN UNIVERSITY AND GEORGE WASHINGTON UNIVERSITY MEDICAL
SCHOOL, AND PAST CHAIRMAN OF THE DEPARTMENT OF OTOLARYNGOLOGY, HEAD AND NECK
SURGERY AT THE WASHINGTON HOSPITAL CENTER. HE IS INCLUDED IN THE BEST DOCTORS IN
AMERICA. DOB: 05/23/48. ADDRESS: 7536 PEPPERELL DRIVE, BETHESDA, MARYLAND 20817.
PETER W. GAVIAN, CFA, TRUSTEE. MR. GAVIAN IS PRESIDENT OF CORPORATE FINANCE
OF WASHINGTON, INC. FORMERLY, HE WAS A PRINCIPAL OF GAVIAN DE VAUX ASSOCIATES,
AN INVESTMENT BANKING FIRM. HE IS ALSO A CHARTERED FINANCIAL ANALYST AND AN
ACCREDITED SENIOR BUSINESS APPRAISER. DOB: 12/08/32. ADDRESS: 3005 FRANKLIN ROAD
NORTH, ARLINGTON, VIRGINIA 22201.
JOHN G. GUFFEY, JR., TRUSTEE. MR. GUFFEY IS EXECUTIVE VICE PRESIDENT OF
CALVERT SOCIAL INVESTMENT FUND. HE IS ON THE BOARD OF DIRECTORS OF THE CALVERT
SOCIAL INVESTMENT FOUNDATION, ORGANIZING DIRECTOR OF THE COMMUNITY CAPITAL BANK
IN BROOKLYN, NEW YORK, AND A FINANCIAL CONSULTANT TO VARIOUS ORGANIZATIONS. IN
ADDITION, HE IS A DIRECTOR OF THE COMMUNITY BANKERS MUTUAL FUND OF DENVER,
COLORADO, A DIRECTOR OF ARIEL FUNDS, AND THE TREASURER AND DIRECTOR OF SILBY,
GUFFEY, AND CO., INC., A VENTURE CAPITAL FIRM. MR. GUFFEY IS A TRUSTEE/DIRECTOR
OF EACH OF THE OTHER INVESTMENT COMPANIES IN THE CALVERT GROUP OF FUNDS, EXCEPT
FOR CALVERT VARIABLE SERIES, INC. AND CALVERT NEW WORLD FUND, INC. DOB:
05/15/48. ADDRESS: 388 CALLE COLINA SANTA FE, NEW MEXICO 87501.
MR. GUFFEY HAS BEEN ADVISED THAT THE SECURITIES AND EXCHANGE COMMISSION
("SEC") HAS ENTERED AN ORDER AGAINST HIM RELATING TO HIS FORMER SERVICE AS A
DIRECTOR OF COMMUNITY BANKERS MUTUAL FUND, INC. THIS FUND IS NOT CONNECTED WITH
ANY CALVERT FUND OR THE CALVERT GROUP AND CEASED OPERATIONS IN SEPTEMBER, 1994.
MR. GUFFEY CONSENTED TO THE ENTRY OF THE ORDER WITHOUT ADMITTING OR DENYING THE
FINDINGS IN THE ORDER. THE ORDER CONTAINS FINDINGS THAT: (1) THAT THE COMMUNITY
BANKERS MUTUAL FUND'S PROSPECTUS AND STATEMENT OF ADDITIONAL INFORMATION WERE
MATERIALLY FALSE AND MISLEADING BECAUSE THEY MISSTATED OR FAILED TO STATE
MATERIAL FACTS CONCERNING THE PRICING OF FUND SHARES AND THE PERCENTAGE OF
ILLIQUID SECURITIES IN THE FUND'S PORTFOLIO AND THAT MR. GUFFEY, AS A MEMBER OF
THE FUND'S BOARD, SHOULD HAVE KNOWN OF THESE MISSTATEMENTS AND THEREFORE
VIOLATED THE SECURITIES ACT OF 1933; (2) THAT THE PRICE OF THE FUND'S SHARES
SOLD TO THE PUBLIC WAS NOT BASED ON THE CURRENT NET ASSET VALUE OF THE SHARES,
IN VIOLATION OF THE INVESTMENT COMPANY ACT OF 1940 (THE "INVESTMENT COMPANY
ACT"); AND (3) THAT THE BOARD OF THE FUND, INCLUDING MR. GUFFEY, VIOLATED THE
INVESTMENT COMPANY ACT BY DIRECTING THE FILING OF A MATERIALLY FALSE
REGISTRATION STATEMENT. THE ORDER DIRECTED MR. GUFFEY TO CEASE AND DESIST FROM
COMMITTING OR CAUSING FUTURE VIOLATIONS AND TO PAY A CIVIL PENALTY OF $5,000.
THE SEC PLACED NO RESTRICTIONS ON MR. GUFFEY'S CONTINUING TO SERVE AS A TRUSTEE
OR DIRECTOR OF MUTUAL FUNDS.
*BARBARA J. KRUMSIEK, PRESIDENT AND TRUSTEE. MS. KRUMSIEK SERVES AS
PRESIDENT, CHIEF EXECUTIVE OFFICER AND VICE CHAIRMAN OF CALVERT GROUP, LTD. AND
AS AN OFFICER AND DIRECTOR OF EACH OF ITS AFFILIATED COMPANIES. SHE IS A
DIRECTOR OF CALVERT-SLOAN ADVISERS, L.L.C., AND A TRUSTEE/DIRECTOR OF EACH OF
THE INVESTMENT COMPANIES IN THE CALVERT GROUP OF FUNDS, AS WELL AS SENIOR VICE
PRESIDENT OF CALVERT SOCIAL INVESTMENT FUND. MS. KRUMSIEK IS ON THE BOARD OF
DIRECTORS OF THE CALVERT SOCIAL INVESTMENT FOUNDATION. PRIOR TO JOINING CALVERT
GROUP, MS. KRUMSIEK SERVED AS A MANAGING DIRECTOR OF ALLIANCE FUND DISTRIBUTORS,
INC. DOB: 08/09/52.
M. CHARITO KRUVANT, TRUSTEE. MS. KRUVANT IS PRESIDENT AND CEO OF CREATIVE
ASSOCIATES INTERNATIONAL, INC., A FIRM THAT SPECIALIZES IN HUMAN RESOURCES
DEVELOPMENT, INFORMATION MANAGEMENT, PUBLIC AFFAIRS AND PRIVATE ENTERPRISE
DEVELOPMENT. SHE IS ALSO A DIRECTOR OF ACACIA FEDERAL SAVINGS BANK. DOB:
12/08/45. ADDRESS: 5301 WISCONSIN AVENUE, N.W., WASHINGTON, D.C. 20015.
ARTHUR J. PUGH, TRUSTEE. MR. PUGH IS A DIRECTOR OF CALVERT VARIABLE SERIES,
INC., AND SERVES AS A DIRECTOR OF ACACIA FEDERAL SAVINGS BANK. DOB: 09/24/37.
ADDRESS: 4823 PRESTWICK DRIVE, FAIRFAX, VIRGINIA 22030.
*DAVID R. ROCHAT, SENIOR VICE PRESIDENT AND TRUSTEE. MR. ROCHAT IS
EXECUTIVE VICE PRESIDENT OF CALVERT ASSET MANAGEMENT COMPANY, INC., DIRECTOR AND
SECRETARY OF GRADY, BERWALD AND CO., INC., AND DIRECTOR AND PRESIDENT OF CHELSEA
SECURITIES, INC. HE IS THE SENIOR VICE PRESIDENT OF FIRST VARIABLE RATE FUND,
CALVERT TAX-FREE RESERVES, CALVERT MUNICIPAL FUND, INC., CALVERT CASH RESERVES,
AND THE CALVERT FUND. DOB: 10/07/37. ADDRESS: BOX 93, CHELSEA, VERMONT 05038.
*D. WAYNE SILBY, ESQ., TRUSTEE. MR. SILBY IS A TRUSTEE/DIRECTOR OF EACH OF
THE INVESTMENT COMPANIES IN THE CALVERT GROUP OF FUNDS, EXCEPT FOR CALVERT
VARIABLE SERIES, INC. AND CALVERT NEW WORLD FUND, INC. HE IS THE PRESIDENT OF
CALVERT SOCIAL INVESTMENT FUND. MR. SILBY IS EXECUTIVE CHAIRMAN OF GROUP SERVE,
INC., AN INTERNET COMPANY FOCUSED ON COMMUNITY BUILDING COLLABORATIVE TOOLS, AND
AN OFFICER, DIRECTOR AND SHAREHOLDER OF SILBY, GUFFEY & COMPANY, INC., WHICH
SERVES AS GENERAL PARTNER OF CALVERT SOCIAL VENTURE PARTNERS ("CSVP"). CSVP IS A
VENTURE CAPITAL FIRM INVESTING IN SOCIALLY RESPONSIBLE SMALL COMPANIES. HE IS
ALSO A DIRECTOR OF ACACIA MUTUAL LIFE INSURANCE COMPANY AND CHAIRMAN OF THE
CALVERT SOCIAL INVESTMENT FOUNDATION. DOB: 7/20/48. ADDRESS: 1715 18TH STREET,
N.W., WASHINGTON, D.C. 20009.
RENO J. MARTINI, SENIOR VICE PRESIDENT. MR. MARTINI IS A DIRECTOR AND
SENIOR VICE PRESIDENT OF CALVERT GROUP, LTD., AND SENIOR VICE PRESIDENT AND
CHIEF INVESTMENT OFFICER OF CALVERT ASSET MANAGEMENT COMPANY, INC. MR. MARTINI
IS ALSO A DIRECTOR AND PRESIDENT OF CALVERT-SLOAN ADVISERS, L.L.C., AND A
DIRECTOR AND OFFICER OF CALVERT NEW WORLD FUND. DOB: 1/13/50.
RONALD M. WOLFSHEIMER, CPA, TREASURER. MR. WOLFSHEIMER IS SENIOR VICE
PRESIDENT AND CHIEF FINANCIAL OFFICER OF CALVERT GROUP, LTD. AND ITS
SUBSIDIARIES AND AN OFFICER OF EACH OF THE OTHER INVESTMENT COMPANIES IN THE
CALVERT GROUP OF FUNDS. MR. WOLFSHEIMER IS VICE PRESIDENT AND TREASURER OF
CALVERT-SLOAN ADVISERS, L.L.C., AND A DIRECTOR OF CALVERT DISTRIBUTORS, INC.
DOB: 07/24/47.
WILLIAM M. TARTIKOFF, ESQ., VICE PRESIDENT AND SECRETARY. MR. TARTIKOFF IS
AN OFFICER OF EACH OF THE INVESTMENT COMPANIES IN THE CALVERT GROUP OF FUNDS,
AND IS SENIOR VICE PRESIDENT, SECRETARY, AND GENERAL COUNSEL OF CALVERT GROUP,
LTD., AND EACH OF ITS SUBSIDIARIES. MR. TARTIKOFF IS ALSO VICE PRESIDENT AND
SECRETARY OF CALVERT-SLOAN ADVISERS, L.L.C., A DIRECTOR OF CALVERT DISTRIBUTORS,
INC., AND IS AN OFFICER OF ACACIA NATIONAL LIFE INSURANCE COMPANY. DOB:
08/12/47.
DANIEL K. HAYES, VICE PRESIDENT. MR. HAYES IS VICE PRESIDENT OF CALVERT
ASSET MANAGEMENT COMPANY, INC., AND IS AN OFFICER OF EACH OF THE OTHER
INVESTMENT COMPANIES IN THE CALVERT GROUP OF FUNDS, EXCEPT FOR CALVERT NEW WORLD
FUND, INC. DOB: 09/09/50.
SUSAN WALKER BENDER, ESQ., ASSISTANT SECRETARY. MS. BENDER IS ASSOCIATE
GENERAL COUNSEL OF CALVERT GROUP, LTD. AND AN OFFICER OF EACH OF ITS
SUBSIDIARIES AND CALVERT-SLOAN ADVISERS, L.L.C. SHE IS ALSO AN OFFICER OF EACH
OF THE OTHER INVESTMENT COMPANIES IN THE CALVERT GROUP OF FUNDS. DOB: 01/29/59.
VICTOR FRYE, ESQ., ASSISTANT SECRETARY AND COMPLIANCE OFFICER. MR. FRYE IS
COUNSEL AND COMPLIANCE OFFICER OF CALVERT GROUP AND AN OFFICER OF EACH OF ITS
SUBSIDIARIES AND CALVERT-SLOAN ADVISERS, L.L.C. HE IS ALSO AN OFFICER OF EACH OF
THE OTHER INVESTMENT COMPANIES IN THE CALVERT GROUP OF FUNDS. PRIOR TO WORKING
AT CALVERT GROUP, MR. FRYE WAS COUNSEL AND MANAGER OF THE COMPLIANCE DEPARTMENT
AT THE ADVISORS GROUP. DOB: 10/15/58.
IVY WAFFORD DUKE, ESQ., ASSISTANT SECRETARY. MS. DUKE IS ASSOCIATE GENERAL
COUNSEL OF CALVERT GROUP AND AN OFFICER OF EACH OF ITS SUBSIDIARIES AND
CALVERT-SLOAN ADVISERS, L.L.C. SHE IS ALSO AN OFFICER OF EACH OF THE OTHER
INVESTMENT COMPANIES IN THE CALVERT GROUP OF FUNDS. SHE ALSO SERVES AS SECRETARY
AND PROVIDES COUNSEL TO THE CALVERT SOCIAL INVESTMENT FOUNDATION. PRIOR TO
WORKING AT CALVERT GROUP, MS. DUKE WAS AN ASSOCIATE IN THE INVESTMENT MANAGEMENT
GROUP OF THE BUSINESS AND FINANCE DEPARTMENT AT DRINKER BIDDLE & REATH. DOB:
09/07/68.
THE ADDRESS OF DIRECTORS AND OFFICERS, UNLESS OTHERWISE NOTED, IS 4550
MONTGOMERY AVENUE, SUITE 1000N, BETHESDA, MARYLAND 20814. TRUSTEES AND OFFICERS
OF THE FUND AS A GROUP OWN LESS THAN 1% OF THE FUND'S OUTSTANDING SHARES.
TRUSTEES MARKED WITH AN *, ABOVE, ARE "INTERESTED PERSONS" OF THE FUND, UNDER
THE INVESTMENT COMPANY ACT OF 1940.
EACH OF THE ABOVE DIRECTORS/TRUSTEES AND OFFICERS IS A DIRECTOR/TRUSTEE OR
OFFICER OF EACH OF THE INVESTMENT COMPANIES IN THE CALVERT GROUP OF FUNDS WITH
THE EXCEPTION OF CALVERT SOCIAL INVESTMENT FUND, OF WHICH ONLY MESSRS. BAIRD,
GUFFEY, SILBY AND MS. KRUMSIEK ARE AMONG THE TRUSTEES, CALVERT VARIABLE SERIES,
INC., OF WHICH ONLY MESSRS. BLATZ, DIEHL, PUGH AND MS. KRUMSIEK AND MS. KRUVANT
ARE AMONG THE DIRECTORS, CALVERT WORLD VALUES FUND, INC., OF WHICH ONLY MESSRS.
GUFFEY, SILBY AND MS. KRUMSIEK ARE AMONG THE DIRECTORS, AND CALVERT NEW WORLD
FUND, INC., OF WHICH ONLY MS. KRUMSIEK AND MR. MARTINI ARE AMONG THE DIRECTORS.
THE AUDIT COMMITTEE OF THE BOARD IS COMPOSED OF MESSRS. BAIRD, BLATZ,
FELDMAN, GUFFEY AND PUGH. THE BOARD'S INVESTMENT POLICY COMMITTEE IS COMPOSED OF
MESSRS. BORTS, DIEHL, GAVIAN, ROCHAT, SILBY AND MS. KRUMSIEK.
DURING FISCAL 1999, TRUSTEES OF THE FUND NOT AFFILIATED WITH THE FUND'S
ADVISOR WERE PAID $59,538. TRUSTEES OF THE FUND NOT AFFILIATED WITH CAMCO
PRESENTLY RECEIVE AN ANNUAL FEE OF $20,500 FOR SERVICE AS A MEMBER OF THE BOARD
OF TRUSTEES OF THE CALVERT GROUP OF FUNDS, AND A FEE OF $750 TO $1,500 FOR EACH
REGULAR BOARD OR COMMITTEE MEETING ATTENDED; SUCH FEES ARE ALLOCATED AMONG THE
RESPECTIVE FUNDS ON THE BASIS OF NET ASSETS.
TRUSTEES OF THE FUND NOT AFFILIATED WITH THE FUND'S ADVISOR MAY ELECT TO
DEFER RECEIPT OF ALL OR A PERCENTAGE OF THEIR FEES AND INVEST THEM IN ANY FUND
IN THE CALVERT GROUP OF FUNDS THROUGH THE TRUSTEES DEFERRED COMPENSATION PLAN
(SHOWN AS "PENSION OR RETIREMENT BENEFITS ACCRUED AS PART OF FUND EXPENSES,"
BELOW). DEFERRAL OF THE FEES IS DESIGNED TO MAINTAIN THE PARTIES IN THE SAME
POSITION AS IF THE FEES WERE PAID ON A CURRENT BASIS. MANAGEMENT BELIEVES THIS
WILL HAVE A NEGLIGIBLE EFFECT ON THE FUND'S ASSETS, LIABILITIES, NET ASSETS, AND
NET INCOME PER SHARE.
TRUSTEE COMPENSATION TABLE
FISCAL YEAR 1999
(UNAUDITED NUMBERS)
Trustee Compensation Table
Fiscal Year 1999 Aggregate Pension or Total Compensation
Compensation Retirement from Benefits
(unaudited numbers) from Registrant Accrued as Registrant and Fund
for Service part of Complex paid to
as Trustee of Registrant Trustee**
Expenses*
NAME OF TRUSTEE
RICHARD L. BAIRD, JR. $36,250 $0 $39,250
FRANK H. BLATZ, JR. $37,749 $37,749 $48,250
FREDERICK T. BORTS $35,500 $0 $35,500
CHARLES E. DIEHL $37,749 $0 $48,250
DOUGLAS E. FELDMAN $37,000 $0 $37,000
PETER W. GAVIAN $37,000 $0 $37,000
JOHN G. GUFFEY, JR. $36,249 $7,032 $56,365
M. CHARITO KRUVANT $35,501 $21,300 $45,250
ARTHUR J. PUGH $37,750 $0 $48,250
D. WAYNE SILBY $32,500 $0 $60,831
*MESSRS. BLATZ, DIEHL, GAVIAN, PUGH, GUFFEY AND MS. KRUVANT HAVE CHOSEN TO DEFER
A PORTION OF THEIR COMPENSATION. AS OF SEPTEMBER 30, 1999, TOTAL DEFERRED
COMPENSATION, INCLUDING DIVIDENDS AND CAPITAL APPRECIATION, WAS $610,683,
$835,804, $110,429, $220,237, $11,021 AND $57,932, FOR EACH OF THEM,
RESPECTIVELY.
**FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 1999. THE FUND COMPLEX CONSISTS OF
NINE (9) REGISTERED INVESTMENT COMPANIES.
INVESTMENT ADVISOR
------------------
THE FUND'S INVESTMENT ADVISOR IS CALVERT ASSET MANAGEMENT COMPANY, INC.,
4550 MONTGOMERY AVENUE, SUITE 1000N, BETHESDA, MARYLAND 20814, A SUBSIDIARY OF
CALVERT GROUP, LTD., WHICH IS A SUBSIDIARY OF ACACIA LIFE INSURANCE COMPANY OF
WASHINGTON, D.C. ("ACACIA"). ACACIA IS A SUBSIDIARY OF AMERITAS ACACIA MUTUAL
HOLDING COMPANY.
THE ADVISORY CONTRACT BETWEEN THE FUND AND CAMCO WILL REMAIN IN EFFECT
UNTIL JANUARY 1, 2000, AND FROM YEAR TO YEAR THEREAFTER, PROVIDED CONTINUANCE IS
APPROVED AT LEAST ANNUALLY BY THE VOTE OF THE HOLDERS OF A MAJORITY OF THE
OUTSTANDING SHARES OF THE FUND, OR BY THE TRUSTEES OF THE FUND; AND FURTHER
PROVIDED THAT SUCH CONTINUANCE IS ALSO APPROVED ANNUALLY BY THE VOTE OF A
MAJORITY OF THE TRUSTEES OF THE FUND WHO ARE NOT PARTIES TO THE ADVISORY
CONTRACT OR INTERESTED PERSONS OF SUCH PARTIES, CAST IN PERSON AT A MEETING
CALLED FOR THE PURPOSE OF VOTING ON SUCH APPROVAL. THE ADVISORY CONTRACT MAY BE
TERMINATED WITHOUT PENALTY BY EITHER PARTY ON 60 DAYS' PRIOR WRITTEN NOTICE; IT
AUTOMATICALLY TERMINATES IN THE EVENT OF ITS ASSIGNMENT.
UNDER THE ADVISORY CONTRACT, CAMCO MANAGES THE INVESTMENT AND REINVESTMENT
OF THE FUND'S ASSETS, SUBJECT TO THE DIRECTION AND CONTROL OF THE FUND'S BOARD
OF TRUSTEES. FOR ITS SERVICES, CAMCO RECEIVES AN ANNUAL FEE, PAYABLE MONTHLY, OF
0.25% OF THE FUND'S AVERAGE DAILY NET ASSETS.
CAMCO PROVIDES THE FUND WITH INVESTMENT SUPERVISION AND MANAGEMENT, OFFICE
SPACE, FURNISHES EXECUTIVE AND OTHER PERSONNEL TO THE FUND, AND PAYS THE
SALARIES AND FEES OF ALL TRUSTEES WHO ARE AFFILIATED PERSONS OF CAMCO. CAMCO MAY
ASSUME AND PAY CERTAIN FUND ADVERTISING AND PROMOTIONAL EXPENSES AND RESERVES
THE RIGHT TO COMPENSATE BROKER-DEALERS IN CONSIDERATION OF THEIR PROMOTIONAL OR
ADMINISTRATIVE SERVICES.
THE FUND PAYS ALL OTHER EXPENSES INCLUDING: CUSTODIAL FEES; SHAREHOLDER
SERVICING, DIVIDEND DISBURSING AND TRANSFER AGENCY FEES; ADMINISTRATIVE
SERVICES; FEDERAL AND STATE SECURITIES REGISTRATION FEES; INSURANCE PREMIUMS;
TRADE ASSOCIATION DUES; INTEREST, TAXES AND OTHER BUSINESS FEES; LEGAL AND AUDIT
FEES; AND BROKERAGE COMMISSIONS AND OTHER COSTS ASSOCIATED WITH THE PURCHASE AND
SALE OF FUND SECURITIES.
THE ADVISORY FEES ACCRUED FOR THE 1997, 1998 AND 1999 FISCAL YEARS WERE
$934,322, $1,254,573, AND $1,482,590 RESPECTIVELY. DURING 1997, 1998, AND 1999
FISCAL YEARS, CAMCO VOLUNTARILY WAIVED FEES OR ASSUMED EXPENSES OF $1,107,017,
$1,038,689, AND $816,535, RESPECTIVELY, WHICH WERE NOT CHARGED TO THE FUND.
ADMINISTRATIVE SERVICES AGENT
CALVERT ADMINISTRATIVE SERVICES COMPANY ("CASC"), AN AFFILIATE OF CAMCO,
HAS BEEN RETAINED BY THE FUND TO PROVIDE CERTAIN ADMINISTRATIVE SERVICES
NECESSARY TO THE CONDUCT OF ITS AFFAIRS, INCLUDING THE PREPARATION OF REGULATORY
FILINGS AND SHAREHOLDER REPORTS, THE DAILY DETERMINATION OF ITS NET ASSET VALUE
PER SHARE AND DIVIDENDS, AND THE MAINTENANCE OF ITS PORTFOLIO AND GENERAL
ACCOUNTING RECORDS. FOR THE 1997, 1998, AND 1999 FISCAL PERIODS, THE FUND PAID
CASC $176,987, $250,915, AND $296,518 IN ADMINISTRATIVE FEES, RESPECTIVELY.
TRANSFER AND SHAREHOLDER SERVICING AGENTS
-----------------------------------------
NATIONAL FINANCIAL DATA SERVICES, INC. ("NFDS"), A SUBSIDIARY OF STATE
STREET BANK & TRUST, HAS BEEN RETAINED BY THE FUND TO ACT AS TRANSFER AGENT AND
DIVIDEND DISBURSING AGENT. THESE RESPONSIBILITIES INCLUDE: RESPONDING TO CERTAIN
SHAREHOLDER INQUIRIES AND INSTRUCTIONS, CREDITING AND DEBITING SHAREHOLDER
ACCOUNTS FOR PURCHASES AND REDEMPTIONS OF FUND SHARES AND CONFIRMING SUCH
TRANSACTIONS, AND DAILY UPDATING OF SHAREHOLDER ACCOUNTS TO REFLECT DECLARATION
AND PAYMENT OF DIVIDENDS.
CALVERT SHAREHOLDER SERVICES, INC. ("CSSI), A SUBSIDIARY OF CALVERT GROUP,
LTD., AND ACACIA MUTUAL, HAS BEEN RETAINED BY THE FUND TO ACT AS SHAREHOLDER
SERVICING AGENT. SHAREHOLDER SERVICING RESPONSIBILITIES INCLUDE RESPONDING TO
SHAREHOLDER INQUIRIES AND INSTRUCTIONS CONCERNING THEIR ACCOUNTS, ENTERING ANY
TELEPHONED PURCHASES OR REDEMPTIONS INTO THE NFDS SYSTEM, MAINTENANCE OF
BROKER-DEALER DATA, AND PREPARING AND DISTRIBUTING STATEMENTS TO SHAREHOLDERS
REGARDING THEIR ACCOUNTS. FOR THESE SERVICES, NFDS AND CSSI RECEIVE A BASED ON
THE NUMBER OF SHAREHOLDER ACCOUNTS AND TRANSACTIONS.
PERSONAL SECURITIES TRANSACTIONS
--------------------------------
THE FUND, ITS ADVISOR, AND PRINCIPAL UNDERWRITER HAVE ADOPTED A CODE OF
ETHICS PURSUANT TO RULE 17J-1 OF THE INVESTMENT COMPANY ACT OF 1940. THE CODE OF
ETHICS IS DESIGNED TO PROTECT THE PUBLIC FROM ABUSIVE TRADING PRACTICES AND TO
MAINTAIN ETHICAL STANDARDS FOR ACCESS PERSONS AS DEFINED IN THE RULE WHEN
DEALING WITH THE PUBLIC. THE CODE OF ETHICS PERMITS THE FUND'S INVESTMENT
PERSONNEL TO INVEST IN SECURITIES THAT MAYBE PURCHASED OR HELD BY THE FUND. THE
CODE OF ETHICS CONTAINS CERTAIN CONDITIONS SUCH AS PRECLEARANCE AND RESTRICTIONS
ON USE OF MATERIAL INFORMATION.
INDEPENDENT ACCOUNTANTS AND CUSTODIANS
--------------------------------------
PRICEWATERHOUSECOOPERS, LLP HAS BEEN SELECTED BY THE BOARD OF TRUSTEES TO
SERVE AS INDEPENDENT AUDITORS FOR FISCAL YEAR 1999. STATE STREET BANK & TRUST
COMPANY, N.A., 225 FRANKLIN STREET, BOSTON, MA 02110, SERVES AS CUSTODIAN OF THE
FUND'S INVESTMENTS ALLFIRST FINANCIAL, INC., 25 SOUTH CHARLES STREET, BALTIMORE,
MARYLAND 21203 ALSO SERVES AS CUSTODIAN OF CERTAIN OF THE FUND'S CASH ASSETS.
THE CUSTODIAN HAS NO PART IN DECIDING THE FUND'S INVESTMENT POLICIES OR THE
CHOICE OF SECURITIES THAT ARE TO BE PURCHASED OR SOLD FOR THE FUND.
METHOD OF DISTRIBUTION
----------------------
CALVERT DISTRIBUTORS, INC. ("CDI"), 4550 MONTGOMERY AVENUE, SUITE 1000N,
BETHESDA, MARYLAND 20814, IS THE PRINCIPAL UNDERWRITER AND DISTRIBUTOR FOR THE
FUND. CDI IS AN AFFILIATE OF THE FUND'S ADVISOR. UNDER THE TERMS OF ITS
UNDERWRITING AGREEMENT WITH THE FUNDS, CDI MARKETS AND DISTRIBUTES THE FUND'S
SHARES AND IS RESPONSIBLE FOR PREPARING ADVERTISING AND SALES LITERATURE, AND
PRINTING AND MAILING PROSPECTUSES TO PROSPECTIVE INVESTORS. THE ADVISOR AND CDI,
AT THEIR OWN EXPENSE, MAY INCUR COSTS OR PAY EXPENSES ASSOCIATED WITH THE
DISTRIBUTION OF THE FUND'S SHARES.
PORTFOLIO TRANSACTIONS
----------------------
FUND TRANSACTIONS ARE UNDERTAKEN ON THE BASIS OF THEIR DESIRABILITY FROM AN
INVESTMENT STANDPOINT. THE FUND'S ADVISOR MAKES INVESTMENT DECISIONS AND THE
CHOICE OF BROKERS AND DEALERS UNDER THE DIRECTION AND SUPERVISION OF THE FUND'S
BOARD OF TRUSTEES.
BROKER-DEALERS WHO EXECUTE FUND TRANSACTIONS ON BEHALF OF THE FUND ARE
SELECTED ON THE BASIS OF THEIR EXECUTION CAPABILITY AND TRADING EXPERTISE
CONSIDERING, AMONG OTHER FACTORS, THE OVERALL REASONABLENESS OF THE BROKERAGE
COMMISSIONS, CURRENT MARKET CONDITIONS, SIZE AND TIMING OF THE ORDER, DIFFICULTY
OF EXECUTION, PER SHARE PRICE, MARKET FAMILIARITY, RELIABILITY, INTEGRITY,
FINANCIAL CONDITION, SUBJECT TO THE ADVISOR'S OBLIGATION TO SEEK BEST EXECUTION.
THE ADVISOR MAY ALSO CONSIDER SALES OF FUND SHARES AS A FACTOR IN THE SELECTION
OF BROKERS.
FOR THE LAST THREE FISCAL YEARS, TOTAL BROKERAGE COMMISSIONS PAID ARE AS
FOLLOWS:
1997 1998 1999
$0 $0 $0
THE FUND DID NOT PAY ANY BROKERAGE COMMISSIONS TO AFFILIATED PERSONS DURING THE
LAST THREE FISCAL YEARS.
WHILE THE FUND'S ADVISOR AND SUBADVISOR(S) SELECT BROKERS PRIMARILY ON THE
BASIS OF BEST EXECUTION, IN SOME CASES THEY MAY DIRECT TRANSACTIONS TO BROKERS
BASED ON THE QUALITY AND AMOUNT OF THE RESEARCH AND RESEARCH-RELATED SERVICES
WHICH THE BROKERS PROVIDE TO THEM. THE ADVISOR OR SUBADVISOR MAY ALSO CONSIDER
SALES OF FUND SHARES MADE BY THE BROKER. THESE RESEARCH SERVICES INCLUDE ADVICE,
EITHER DIRECTLY OR THROUGH PUBLICATIONS OR WRITINGS, AS TO THE VALUE OF
SECURITIES, THE ADVISABILITY OF INVESTING IN, PURCHASING OR SELLING SECURITIES,
AND THE AVAILABILITY OF SECURITIES OR PURCHASERS OR SELLERS OF SECURITIES;
FURNISHING OF ANALYSES AND REPORTS CONCERNING ISSUERS, SECURITIES OR INDUSTRIES;
PROVIDING INFORMATION ON ECONOMIC FACTORS AND TRENDS; ASSISTING IN DETERMINING
PORTFOLIO STRATEGY; PROVIDING COMPUTER SOFTWARE USED IN SECURITY ANALYSES;
PROVIDING PORTFOLIO PERFORMANCE EVALUATION AND TECHNICAL MARKET ANALYSES; AND
PROVIDING OTHER SERVICES RELEVANT TO THE INVESTMENT DECISION MAKING PROCESS. IT
IS THE POLICY OF THE ADVISOR THAT SUCH RESEARCH SERVICES WILL BE USED FOR THE
BENEFIT OF THE FUND AS WELL AS OTHER CALVERT GROUP FUNDS AND MANAGED ACCOUNTS.
OTHER SUCH SERVICES ARE DESIGNED PRIMARILY TO ASSIST THE ADVISOR IN MONITORING
THE INVESTMENT ACTIVITIES OF THE SUBADVISOR(S) OF THE FUND. SUCH SERVICES
INCLUDE PORTFOLIO ATTRIBUTION SYSTEMS, RETURN-BASED STYLE ANALYSIS, AND
TRADE-EXECUTION ANALYSIS.
IF, IN THE JUDGMENT OF THE ADVISOR OR SUBADVISOR(S), THE FUND OR OTHER ACCOUNTS
MANAGED BY THEM WILL BE BENEFITED BY SUPPLEMENTAL RESEARCH SERVICES, THEY ARE
AUTHORIZED TO PAY BROKERAGE COMMISSIONS TO A BROKER FURNISHING SUCH SERVICES
WHICH ARE IN EXCESS OF COMMISSIONS WHICH ANOTHER BROKER MAY HAVE CHARGED FOR
EFFECTING THE SAME TRANSACTION.
GENERAL INFORMATION
-------------------
THE FUND IS THE ONLY SERIES OF A MASSACHUSETTS BUSINESS TRUST ORGANIZED ON
MARCH 16, 1982, UNDER THE NAME CALVERT CASH RESERVES. UNTIL JUNE 30, 1996, THE
FUND DID BUSINESS AS MONEY MANAGEMENT PLUS. THE FUND'S DECLARATION OF TRUST
CONTAINS AN EXPRESS DISCLAIMER OF SHAREHOLDER LIABILITY FOR ACTS OR OBLIGATIONS
OF THE FUND. THE SHAREHOLDERS OF A MASSACHUSETTS BUSINESS TRUST MIGHT, HOWEVER,
UNDER CERTAIN CIRCUMSTANCES, BE HELD PERSONALLY LIABLE AS PARTNERS FOR ITS
OBLIGATIONS. THE DECLARATION OF TRUST PROVIDES FOR INDEMNIFICATION AND
REIMBURSEMENT OF EXPENSES OUT OF FUND ASSETS FOR ANY SHAREHOLDER HELD PERSONALLY
LIABLE FOR OBLIGATIONS OF THE FUND. THE DECLARATION OF TRUST PROVIDES THAT THE
FUND SHALL, UPON REQUEST, ASSUME THE DEFENSE OF ANY CLAIM MADE AGAINST ANY
SHAREHOLDER FOR ANY ACT OR OBLIGATION OF THE FUND AND SATISFY ANY JUDGMENT
THEREON. THE DECLARATION OF TRUST FURTHER PROVIDES THAT THE FUND MAY MAINTAIN
APPROPRIATE INSURANCE (FOR EXAMPLE, FIDELITY BONDING AND ERRORS AND OMISSIONS
INSURANCE) FOR THE PROTECTION OF THE FUND, ITS SHAREHOLDERS, TRUSTEES, OFFICERS,
EMPLOYEES, AND AGENTS TO COVER POSSIBLE TORT AND OTHER LIABILITIES. THUS, THE
RISK OF A SHAREHOLDER INCURRING FINANCIAL LOSS ON ACCOUNT OF SHAREHOLDER
LIABILITY IS LIMITED TO CIRCUMSTANCES IN WHICH BOTH INADEQUATE INSURANCE EXISTS
AND THE FUND ITSELF IS UNABLE TO MEET ITS OBLIGATIONS.
THE FUND IS NOT REQUIRED TO HOLD ANNUAL SHAREHOLDER MEETINGS, BUT SPECIAL
MEETINGS MAY BE CALLED FOR CERTAIN PURPOSES SUCH AS ELECTING TRUSTEES, CHANGING
FUNDAMENTAL POLICIES, OR APPROVING A MANAGEMENT CONTRACT. AS A SHAREHOLDER, YOU
RECEIVE ONE VOTE FOR EACH SHARE OF THE FUND YOU OWN.
CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES
---------------------------------------------------
AS OF JANUARY 14, 2000, THERE WERE NO SHAREHOLDERS THAT OWNED OF RECORD 5%
OR MORE OF THE FUND.
APPENDIX
--------
COMMERCIAL PAPER RATINGS
COMMERCIAL PAPER RATED A-1 BY STANDARD & POOR'S CORPORATION HAS THE
FOLLOWING CHARACTERISTICS: LIQUIDITY RATIOS ARE ADEQUATE TO MEET CASH
REQUIREMENTS; LONG-TERM SENIOR DEBT IS RATED "A" OR BETTER; THE ISSUER HAS
ACCESS TO AT LEAST TWO ADDITIONAL CHANNELS OF BORROWING; BASIC EARNINGS AND CASH
FLOW HAVE AN UPWARD TREND WITH ALLOWANCE MADE FOR UNUSUAL CIRCUMSTANCES;
TYPICALLY, THE ISSUER'S INDUSTRY IS WELL ESTABLISHED AND THE ISSUER HAS A STRONG
POSITION WITHIN THE INDUSTRY; AND THE RELIABILITY AND QUALITY OF MANAGEMENT ARE
UNQUESTIONED. THE RELATIVE STRENGTH OR WEAKNESS OF THE ABOVE FACTORS DETERMINES
WHETHER AN ISSUER'S COMMERCIAL PAPER IS RATED AL, A2, OR A3.
THE RATING PRIME-1 IS THE HIGHEST COMMERCIAL PAPER RATING ASSIGNED BY
MOODY'S INVESTORS SERVICE, INC. AMONG THE FACTORS CONSIDERED BY MOODY'S IN
ASSIGNING RATING ARE THE FOLLOWING: EVALUATION OF THE MANAGEMENT OF THE ISSUER;
ECONOMIC EVALUATION OF THE ISSUER'S INDUSTRY OR INDUSTRIES AND AN APPRAISAL OF
SPECULATIVE-TYPE RISKS WHICH MAY BE INHERENT IN CERTAIN AREAS; EVALUATION OF THE
ISSUER'S PRODUCTS IN RELATION TO COMPETITION AND CUSTOMER ACCEPTANCE; LIQUIDITY;
AMOUNT AND QUALITY OF LONG-TERM DEBT; TREND OF EARNINGS OVER A PERIOD OF TEN
YEARS; FINANCIAL STRENGTH OF A PARENT COMPANY AND THE RELATIONSHIPS WHICH EXIST
WITH THE ISSUER; AND RECOGNITION BY THE MANAGEMENT OF OBLIGATIONS WHICH MAY BE
PRESENT OR MAY ARISE AS A RESULT OF PUBLIC INTEREST QUESTION AND PREPARATIONS TO
MEET SUCH OBLIGATIONS.
INVESTMENT ADVISOR
CALVERT ASSET MANAGEMENT COMPANY, INC.
4550 MONTGOMERY AVENUE
SUITE 1000N
BETHESDA, MARYLAND 20814
SHAREHOLDER SERVICE TRANSFER AGENT
CALVERT SHAREHOLDER SERVICES, INC. NATIONAL FINANCIAL DATA SERVICES, INC.
4550 MONTGOMERY AVENUE 1004 BALTIMORE
SUITE 1000N 6TH FLOOR
BETHESDA, MARYLAND 20814 KANSAS CITY, MISSOURI 64105
PRINCIPAL UNDERWRITER INDEPENDENT ACCOUNTANTS
CALVERT DISTRIBUTORS, INC. PRICEWATERHOUSECOOPERS LLP
4550 MONTGOMERY AVENUE 250 WEST PRATT STREET
SUITE 1000N BALTIMORE, MARYLAND 21201
BETHESDA, MARYLAND 20814
<PAGE>
PART C. OTHER INFORMATION
ITEM 23. EXHIBITS
99.B1 DECLARATION OF TRUST INCORPORATED BY REFERENCE TO REGISTRANT'S
INITIAL REGISTRATION STATEMENT, MARCH 16, 1982, FILED HEREWITH.
99.B2 BY-LAWS INCORPORATED BY REFERENCE TO REGISTRANT'S PRE-EFFECTIVE
AMENDMENT NO. 2, AUGUST 31, 1982, FILED HEREWITH.
99.B5 INVESTMENT ADVISORY AGREEMENT DATED MARCH 1, 1999, FILED HEREWITH.
99.B6 UNDERWRITING AGREEMENT INCORPORATED BY REFERENCE TO
REGISTRANT'S POST-EFFECTIVE AMENDMENT NO. 17,
JANUARY 31, 1995, FILED HEREWITH.
99.B8 CUSTODIAL CONTRACT, INCORPORATED BY REFERENCE TO REGISTRANT'S POST-
EFFECTIVE AMENDMENT NO. 13, SEPTEMBER 30, 1992, FILED HEREWITH.
99.B9 TRANSFER AGENCY AGREEMENT AND SERVICE AGREEMENT FILED HEREWITH.
99.B9A SERVICING AGREEMENT FILED HEREWITH.
99.B9B ADMINISTRATIVE SERVICES AGREEMENT INCORPORATED BY REFERENCE TO
REGISTRANT'S POST-EFFECTIVE AMENDMENT NO. 15, JANUARY 30, 1989,
AMENDED IN 1999, FILED HEREWITH.
99.B10 OPINION AND CONSENT OF COUNSEL FILED HEREWITH.
99.B11. CONSENT OF INDEPENDENT ACCOUNTANTS TO USE OF REPORT FILED HEREWITH.
99.B17.B POWER OF ATTORNEY FORMS SIGNED BY EACH DIRECTOR/TRUSTEE, INCORPORATED
BY
REFERENCE TO REGISTRANT'S POST-EFFECTIVE AMENDMENT NO. 24, DATED
JANUARY 28, 1999, ACCESSION NUMBER 0000701219-99-000002.
99.B18 CODE OF ETHICS FILED HEREWITH.
ITEM 24. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT
NOT APPLICABLE.
ITEM 25. INDEMNIFICATION
REGISTRANT'S DECLARATION OF TRUST, WHICH DECLARATION IS EXHIBIT 1 OF
THIS REGISTRATION STATEMENT, PROVIDES, IN SUMMARY, THAT OFFICERS, TRUSTEES,
EMPLOYEES, AND AGENTS SHALL BE INDEMNIFIED BY REGISTRANT AGAINST LIABILITIES
AND EXPENSES INCURRED BY SUCH PERSONS IN CONNECTION WITH ACTIONS, SUITS, OR
PROCEEDINGS ARISING OUT OF THEIR OFFICES OR DUTIES OF EMPLOYMENT, EXCEPT THAT
NO INDEMNIFICATION CAN BE MADE TO SUCH A PERSON IF HE HAS BEEN ADJUDGED LIABLE
OF WILLFUL MISFEASANCE, BAD FAITH, GROSS NEGLIGENCE, OR RECKLESS DISREGARD OF
HIS DUTIES. IN THE ABSENCE OF SUCH AN ADJUDICATION, THE DETERMINATION OF
ELIGIBILITY FOR INDEMNIFICATION SHALL BE MADE BY INDEPENDENT COUNSEL IN A
WRITTEN OPINION OR BY THE VOTE OF A MAJORITY OF A QUORUM OF TRUSTEES WHO ARE
NEITHER "INTERESTED PERSONS" OF REGISTRANT, AS THAT TERM IS DEFINED IN SECTION
2(A)(19) OF THE INVESTMENT COMPANY ACT OF 1940, NOR PARTIES TO THE PROCEEDING.
REGISTRANT'S DECLARATION OF TRUST ALSO PROVIDES THAT REGISTRANT MAY
PURCHASE AND MAINTAIN LIABILITY INSURANCE ON BEHALF OF ANY OFFICER, TRUSTEE,
EMPLOYEE OR AGENT AGAINST ANY LIABILITIES ARISING FROM SUCH STATUS. IN THIS
REGARD, REGISTRANT MAINTAINS A DIRECTORS & OFFICERS (PARTNERS) LIABILITY
INSURANCE POLICY WITH CHUBB GROUP OF INSURANCE COMPANIES, 15 MOUNTAIN VIEW
ROAD, WARREN, NEW JERSEY 07061, PROVIDING REGISTRANT WITH $5 MILLION IN
DIRECTORS AND OFFICERS LIABILITY COVERAGE, PLUS $5 MILLION IN EXCESS DIRECTORS
AND OFFICERS LIABILITY COVERAGE FOR THE INDEPENDENT TRUSTEES/DIRECTORS ONLY.
REGISTRANT ALSO MAINTAINS AN $9 MILLION INVESTMENT COMPANY BLANKET BOND ISSUED
BY ICI MUTUAL INSURANCE COMPANY, P.O. BOX 730, BURLINGTON, VERMONT, 05402.
ITEM 26. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER
NAME OF COMPANY, PRINCIPAL
NAME BUSINESS AND ADDRESS CAPACITY
BARBARA J. KRUMSIEK CALVERT VARIABLE SERIES, INC. OFFICER
CALVERT MUNICIPAL FUND, INC. AND
CALVERT WORLD VALUES FUND, INC. DIRECTOR
INVESTMENT COMPANIES
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
----------------
FIRST VARIABLE RATE FUND FOR OFFICER
GOVERNMENT INCOME AND
CALVERT TAX-FREE RESERVES TRUSTEE
CALVERT SOCIAL INVESTMENT FUND
CALVERT CASH RESERVES
THE CALVERT FUND
INVESTMENT COMPANIES
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
----------------
CALVERT ASSET MANAGEMENT CO., INC. OFFICER
INVESTMENT ADVISOR AND
4550 MONTGOMERY AVENUE DIRECTOR
BETHESDA, MARYLAND 20814
----------------
CALVERT GROUP, LTD. OFFICER
HOLDING COMPANY AND
4550 MONTGOMERY AVENUE DIRECTOR
BETHESDA, MARYLAND 20814
----------------
CALVERT SHAREHOLDER SERVICES, INC. OFFICER
TRANSFER AGENT AND
4550 MONTGOMERY AVENUE DIRECTOR
BETHESDA, MARYLAND 20814
---------------
CALVERT ADMINISTRATIVE SERVICES CO. OFFICER
SERVICE COMPANY AND
4550 MONTGOMERY AVENUE DIRECTOR
BETHESDA, MARYLAND 20814
---------------
CALVERT DISTRIBUTORS, INC. OFFICER
BROKER-DEALER AND
4550 MONTGOMERY AVENUE DIRECTOR
BETHESDA, MARYLAND 20814
---------------
CALVERT-SLOAN ADVISERS, LLC DIRECTOR
INVESTMENT ADVISOR
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT NEW WORLD FUND, INC. DIRECTOR
INVESTMENT COMPANY
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
--------------
ALLIANCE CAPITAL MGMT. L.P. SR. VICE PRESIDENT
MUTUAL FUND DIVISION DIRECTOR
1345 AVENUE OF THE AMERICAS
NEW YORK, NY 10105
--------------
RONALD M. WOLFSHEIMER FIRST VARIABLE RATE FUND OFFICER
FOR GOVERNMENT INCOME
CALVERT TAX-FREE RESERVES
CALVERT CASH RESERVES
CALVERT SOCIAL INVESTMENT FUND
THE CALVERT FUND
CALVERT VARIABLE SERIES, INC.
CALVERT MUNICIPAL FUND, INC.
CALVERT WORLD VALUES FUND, INC.
CALVERT NEW WORLD FUND, INC.
INVESTMENT COMPANIES
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
--------------
CALVERT ASSET MANAGEMENT CO., INC. OFFICER
INVESTMENT ADVISOR
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT GROUP, LTD. OFFICER
HOLDING COMPANY
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT SHAREHOLDER SERVICES, INC. OFFICER
TRANSFER AGENT
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT ADMINISTRATIVE SERVICES CO. OFFICER
SERVICE COMPANY AND
4550 MONTGOMERY AVENUE DIRECTOR
BETHESDA, MARYLAND 20814
---------------
CALVERT DISTRIBUTORS, INC. OFFICER
BROKER-DEALER AND
4550 MONTGOMERY AVENUE DIRECTOR
BETHESDA, MARYLAND 20814
---------------
CALVERT-SLOAN ADVISERS, LLC OFFICER
INVESTMENT ADVISOR
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
DAVID R. ROCHAT FIRST VARIABLE RATE FUND OFFICER
FOR GOVERNMENT INCOME AND
CALVERT TAX-FREE RESERVES TRUSTEE
CALVERT CASH RESERVES
THE CALVERT FUND
INVESTMENT COMPANIES
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT MUNICIPAL FUND, INC. OFFICER
INVESTMENT COMPANY AND
4550 MONTGOMERY AVENUE DIRECTOR
BETHESDA, MARYLAND 20814
---------------
CALVERT ASSET MANAGEMENT CO., INC. OFFICER
INVESTMENT ADVISOR AND
4550 MONTGOMERY AVENUE DIRECTOR
BETHESDA, MARYLAND 20814
---------------
CHELSEA SECURITIES, INC. OFFICER
SECURITIES FIRM AND
POST OFFICE BOX 93 DIRECTOR
CHELSEA, VERMONT 05038
---------------
GRADY, BERWALD & CO. OFFICER
HOLDING COMPANY AND
43A SOUTH FINLEY AVENUE DIRECTOR
BASKING RIDGE, NJ 07920
---------------
RENO J. MARTINI CALVERT ASSET MANAGEMENT CO., INC. OFFICER
INVESTMENT ADVISOR
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT GROUP, LTD. OFFICER
HOLDING COMPANY
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
FIRST VARIABLE RATE FUND OFFICER
FOR GOVERNMENT INCOME
CALVERT TAX-FREE RESERVES
CALVERT CASH RESERVES
CALVERT SOCIAL INVESTMENT FUND
THE CALVERT FUND
CALVERT VARIABLE SERIES, INC.
CALVERT MUNICIPAL FUND, INC.
CALVERT WORLD VALUES FUND, INC.
INVESTMENT COMPANIES
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT NEW WORLD FUND, INC. DIRECTOR
INVESTMENT COMPANY AND
4550 MONTGOMERY AVENUE OFFICER
BETHESDA, MARYLAND 20814
---------------
CALVERT-SLOAN ADVISERS, LLC DIRECTOR
INVESTMENT ADVISOR AND
4550 MONTGOMERY AVENUE OFFICER
BETHESDA, MARYLAND 20814
---------------
CHARLES T. NASON AMERITAS ACACIA MUTUAL HOLDING COMPANY OFFICER
ACACIA LIFE INSURANCE AND
DIRECTOR
INSURANCE COMPANIES
7315 WISCONSIN AVENUE
BETHESDA, MARYLAND 20814
---------------
ACACIA FINANCIAL CORPORATION OFFICER
HOLDING COMPANY AND
7315 WISCONSIN AVENUE DIRECTOR
BETHESDA, MARYLAND 20814
---------------
ACACIA FEDERAL SAVINGS BANK DIRECTOR
SAVINGS BANK
7600-B LEESBURG PIKE
FALLS CHURCH, VIRGINIA 22043
---------------
ENTERPRISE RESOURCES, INC. DIRECTOR
BUSINESS SUPPORT SERVICES
7315 WISCONSIN AVENUE
BETHESDA, MARYLAND 20814
---------------
ACACIA REALTY SQUARE, L.L.C. DIRECTOR
REALTY INVESTMENTS
7315 WISCONSIN AVENUE
BETHESDA, MARYLAND 20814
---------------
GARDNER MONTGOMERY COMPANY DIRECTOR
TAX RETURN PREPARATION SERVICES
7315 WISCONSIN AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT GROUP, LTD. DIRECTOR
HOLDING COMPANY
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT ADMINISTRATIVE SERVICES CO. DIRECTOR
SERVICE COMPANY
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT ASSET MANAGEMENT CO., INC. DIRECTOR
INVESTMENT ADVISOR
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT SHAREHOLDER SERVICES, INC. DIRECTOR
TRANSFER AGENT
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT SOCIAL INVESTMENT FUND TRUSTEE
INVESTMENT COMPANY
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
-----------------
THE ADVISORS GROUP, LTD. DIRECTOR
BROKER-DEALER AND
INVESTMENT ADVISOR
7315 WISCONSIN AVENUE
BETHESDA, MARYLAND 20814
---------------
ROBERT-JOHN H. SANDS
AMERITAS ACACIA MUTUAL HOLDING COMPANY OFFICER
ACACIA LIFE INSURANCE
ACACIA NATIONAL LIFE INSURANCE OFFICER
INSURANCE COMPANY AND
7315 WISCONSIN AVENUE DIRECTOR
BETHESDA, MARYLAND 20814
----------------
ACACIA LIFE INSURANCE OFFICER
INSURANCE COMPANY
7315 WISCONSIN AVENUE
BETHESDA, MARYLAND 20814
----------------
ACACIA FINANCIAL CORPORATION OFFICER
HOLDING COMPANY AND
7315 WISCONSIN AVENUE DIRECTOR
BETHESDA, MARYLAND 20814
----------------
ACACIA FEDERAL SAVINGS BANK OFFICER
SAVINGS BANK
7600-B LEESBURG PIKE
FALLS CHURCH, VIRGINIA 22043
---------------
ENTERPRISE RESOURCES, INC. DIRECTOR
BUSINESS SUPPORT SERVICES
7315 WISCONSIN AVENUE
BETHESDA, MARYLAND 20814
---------------
ACACIA REALTY SQUARE, L.L.C. DIRECTOR
REALTY INVESTMENTS
7315 WISCONSIN AVENUE
BETHESDA, MARYLAND 20814
---------------
THE ADVISORS GROUP, LTD. DIRECTOR
BROKER-DEALER AND
INVESTMENT ADVISOR
7315 WISCONSIN AVENUE
BETHESDA, MARYLAND 20814
---------------
GARDNER MONTGOMERY COMPANY DIRECTOR
TAX RETURN PREPARATION SERVICES
7315 WISCONSIN AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT GROUP, LTD. DIRECTOR
HOLDING COMPANY
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT ADMINISTRATIVE SERVICES CO. DIRECTOR
SERVICE COMPANY
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT ASSET MANAGEMENT, CO., INC. DIRECTOR
INVESTMENT ADVISOR
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT SHAREHOLDER SERVICES, INC. DIRECTOR
TRANSFER AGENT
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
WILLIAM M. TARTIKOFF ACACIA NATIONAL LIFE INSURANCE OFFICER
INSURANCE COMPANY
7315 WISCONSIN AVENUE
BETHESDA, MARYLAND 20814
----------------
FIRST VARIABLE RATE FUND FOR OFFICER
GOVERNMENT INCOME
CALVERT TAX-FREE RESERVES
CALVERT CASH RESERVES
CALVERT SOCIAL INVESTMENT FUND
THE CALVERT FUND
CALVERT VARIABLE SERIES, INC.
CALVERT MUNICIPAL FUND, INC.
CALVERT WORLD VALUES FUND, INC.
CALVERT NEW WORLD FUND, INC.
INVESTMENT COMPANIES
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT GROUP, LTD. OFFICER
HOLDING COMPANY
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT ADMINISTRATIVE OFFICER
SERVICES COMPANY
SERVICE COMPANY
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT ASSET MANAGEMENT CO. INC. OFFICER
INVESTMENT ADVISOR
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
----------------
CALVERT SHAREHOLDER SERVICES, INC. OFFICER
TRANSFER AGENT
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
----------------
CALVERT DISTRIBUTORS, INC. DIRECTOR
BROKER-DEALER AND
4550 MONTGOMERY AVENUE OFFICER
BETHESDA, MARYLAND 20814
----------------
CALVERT-SLOAN ADVISERS, LLC OFFICER
INVESTMENT ADVISOR
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
----------------
SUSAN WALKER BENDER CALVERT GROUP, LTD. OFFICER
HOLDING COMPANY
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT ADMINISTRATIVE SERVICES CO. OFFICER
SERVICE COMPANY
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT ASSET MANAGEMENT CO., INC. OFFICER
INVESTMENT ADVISOR
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
----------------
CALVERT SHAREHOLDER SERVICES, INC. OFFICER
TRANSFER AGENT
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
----------------
CALVERT DISTRIBUTORS, INC. OFFICER
BROKER-DEALER
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
----------------
CALVERT-SLOAN ADVISERS, LLC OFFICER
INVESTMENT ADVISOR
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
----------------
FIRST VARIABLE RATE FUND FOR OFFICER
GOVERNMENT INCOME
CALVERT TAX-FREE RESERVES
CALVERT CASH RESERVES
CALVERT SOCIAL INVESTMENT FUND
THE CALVERT FUND
CALVERT VARIABLE SERIES, INC.
CALVERT MUNICIPAL FUND, INC.
CALVERT WORLD VALUES FUND, INC.
CALVERT NEW WORLD FUND, INC.
INVESTMENT COMPANIES
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
IVY WAFFORD DUKE CALVERT GROUP, LTD. OFFICER
HOLDING COMPANY
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT ADMINISTRATIVE SERVICES CO. OFFICER
SERVICE COMPANY
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT ASSET MANAGEMENT CO., INC. OFFICER
INVESTMENT ADVISOR
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
----------------
CALVERT SHAREHOLDER SERVICES, INC. OFFICER
TRANSFER AGENT
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
----------------
CALVERT DISTRIBUTORS, INC. OFFICER
BROKER-DEALER
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
----------------
CALVERT-SLOAN ADVISERS, LLC OFFICER
INVESTMENT ADVISOR
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
----------------
FIRST VARIABLE RATE FUND FOR OFFICER
GOVERNMENT INCOME
CALVERT TAX-FREE RESERVES
CALVERT CASH RESERVES
CALVERT SOCIAL INVESTMENT FUND
THE CALVERT FUND
CALVERT VARIABLE SERIES, INC.
CALVERT MUNICIPAL FUND, INC.
CALVERT WORLD VALUES FUND, INC.
CALVERT NEW WORLD FUND, INC.
INVESTMENT COMPANIES
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
JENNIFER STREAKS CALVERT GROUP, LTD. OFFICER
HOLDING COMPANY
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT ADMINISTRATIVE SERVICES CO. OFFICER
SERVICE COMPANY
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT ASSET MANAGEMENT CO., INC. OFFICER
INVESTMENT ADVISOR
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
----------------
CALVERT SHAREHOLDER SERVICES, INC. OFFICER
TRANSFER AGENT
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
----------------
CALVERT DISTRIBUTORS, INC. OFFICER
BROKER-DEALER
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
VICTOR FRYE CALVERT GROUP, LTD. OFFICER
HOLDING COMPANY
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT ADMINISTRATIVE SERVICES CO. OFFICER
SERVICE COMPANY
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
---------------
CALVERT ASSET MANAGEMENT CO., INC. OFFICER
INVESTMENT ADVISOR
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
----------------
CALVERT SHAREHOLDER SERVICES, INC. OFFICER
TRANSFER AGENT
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
----------------
CALVERT DISTRIBUTORS, INC. OFFICER
BROKER-DEALER
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
----------------
THE ADVISORS GROUP, LTD. COUNSEL
BROKER-DEALER AND AND
INVESTMENT ADVISOR COMPLIANCE
7315 WISCONSIN AVENUE MANAGER
BETHESDA, MARYLAND 20814
---------------
DANIEL K. HAYES CALVERT ASSET MANAGEMENT CO., INC. OFFICER
INVESTMENT ADVISOR
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
------------------
FIRST VARIABLE RATE FUND FOR OFFICER
GOVERNMENT INCOME
CALVERT TAX-FREE RESERVES
CALVERT CASH RESERVES
CALVERT SOCIAL INVESTMENT FUND
THE CALVERT FUND
CALVERT VARIABLE SERIES, INC.
CALVERT MUNICIPAL FUND, INC.
CALVERT WORLD VALUES FUND, INC.
INVESTMENT COMPANIES
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
------------------
JOHN NICHOLS CALVERT ASSET MANAGEMENT OFFICER
COMPANY, INC.
INVESTMENT ADVISOR
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
------------------
DAVID LEACH CALVERT ASSET MANAGEMENT OFFICER
COMPANY, INC.
INVESTMENT ADVISOR
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
------------------
MATTHEW D. GELFAND CALVERT ASSET MANAGEMENT OFFICER
COMPANY, INC.
INVESTMENT ADVISOR
4550 MONTGOMERY AVENUE
BETHESDA, MARYLAND 20814
------------------
STRATEGIC INVESTMENT MANAGEMENT OFFICER
INVESTMENT ADVISOR
1001 19TH STREET NORTH
ARLINGTON, VIRGINIA 20009
------------------
ITEM 27. PRINCIPAL UNDERWRITERS
(A) REGISTRANT'S PRINCIPAL UNDERWRITER UNDERWRITES SHARES OF
FIRST VARIABLE RATE FUND FOR GOVERNMENT INCOME, CALVERT TAX-FREE RESERVES,
CALVERT SOCIAL INVESTMENT FUND, CALVERT CASH RESERVES, THE CALVERT FUND,
CALVERT MUNICIPAL FUND, INC., CALVERT WORLD VALUES FUND, INC., CALVERT NEW
WORLD FUND, INC., AND CALVERT VARIABLE SERIES, INC. (FORMERLY NAMED ACACIA
CAPITAL CORPORATION).
(B) POSITIONS OF UNDERWRITER'S OFFICERS AND DIRECTORS
NAME AND PRINCIPAL POSITION(S) WITH POSITION(S) WITH
BUSINESS ADDRESS UNDERWRITER REGISTRANT
BARBARA J. KRUMSIEK DIRECTOR AND PRESIDENT PRESIDENT AND TRUSTEE
RONALD M. WOLFSHEIMER DIRECTOR, SENIOR VICE TREASURER
PRESIDENT AND CHIEF FINANCIAL OFFICER
WILLIAM M. TARTIKOFF DIRECTOR, SENIOR VICE VICE PRESIDENT AND
PRESIDENT AND SECRETARY SECRETARY
CRAIG CLOYED SENIOR VICE PRESIDENT NONE
KAREN BECKER VICE PRESIDENT, OPERATIONS NONE
MATTHEW GELFAND VICE PRESIDENT NONE
GEOFFREY ASHTON REGIONAL VICE PRESIDENT NONE
MARTIN BROWN REGIONAL VICE PRESIDENT NONE
BILL HAIRGROVE REGIONAL VICE PRESIDENT NONE
ANTHONY EAMES REGIONAL VICE PRESIDENT NONE
STEVE HIMBER REGIONAL VICE PRESIDENT NONE
TANYA WILLIAMS REGIONAL VICE PRESIDENT NONE
BEN OGBOGU REGIONAL VICE PRESIDENT NONE
TOM STANTON REGIONAL VICE PRESIDENT NONE
CHRISTINE TESKE REGIONAL VICE PRESIDENT NONE
JENNIFER STREAKS ASSISTANT SECRETARY NONE
SUSAN WALKER BENDER ASSISTANT SECRETARY ASSISTANT SECRETARY
IVY WAFFORD DUKE ASSISTANT SECRETARY ASSISTANT SECRETARY
VICTOR FRYE ASSISTANT SECRETARY NONE
AND COMPLIANCE OFFICER
(C) INAPPLICABLE.
ITEM 28. LOCATION OF ACCOUNTS AND RECORDS
RONALD M. WOLFSHEIMER, TREASURER
AND
WILLIAM M. TARTIKOFF, ASSISTANT SECRETARY
4550 MONTGOMERY AVENUE, SUITE 1000N
BETHESDA, MARYLAND 20814
ITEM 29. MANAGEMENT SERVICES
NOT APPLICABLE
ITEM 30. UNDERTAKINGS
NOT APPLICABLE
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933 AND THE INVESTMENT
COMPANY ACT OF 1940, THE REGISTRANT CERTIFIES THAT IT MEETS ALL OF THE
REQUIREMENTS FOR EFFECTIVENESS OF THIS REGISTRATION STATEMENT UNDER RULE
485(B) UNDER THE SECURITIES ACT AND HAS DULY CAUSED THIS REGISTRATION
STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, DULY AUTHORIZED, IN
THE CITY OF BETHESDA, AND STATE OF MARYLAND, ON THE 25TH DAY OF JANUARY, 2000.
CALVERT CASH RESERVES
BY:
________________**_________________
BARBARA J. KRUMSIEK
PRESIDENT AND TRUSTEE
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933,
THIS REGISTRATION STATEMENT HAS BEEN SIGNED BELOW BY THE FOLLOWING
PERSONS IN THE CAPACITIES INDICATED.
SIGNATURE TITLE DATE
__________**____________ PRESIDENT AND 1/25/2000
BARBARA J. KRUMSIEK TRUSTEE (PRINCIPAL EXECUTIVE OFFICER)
__________**____________ PRINCIPAL ACCOUNTING 1/25/2000
RONALD M. WOLFSHEIMER OFFICER
__________**____________ TRUSTEE 1/25/2000
RICHARD L. BAIRD, JR.
__________**____________ TRUSTEE 1/25/2000
FRANK H. BLATZ, JR., ESQ.
__________**____________ TRUSTEE 1/25/2000
FREDERICK T. BORTS, M.D.
__________**____________ TRUSTEE 1/25/2000
CHARLES E. DIEHL
__________**____________ TRUSTEE 1/25/2000
DOUGLAS E. FELDMAN
__________**____________ TRUSTEE 1/25/2000
PETER W. GAVIAN
__________**____________ TRUSTEE 1/25/2000
JOHN G. GUFFEY, JR.
__________**____________ TRUSTEE 1/25/2000
M. CHARITO KRUVANT
__________**____________ TRUSTEE 1/25/2000
ARTHUR J. PUGH
__________**____________ TRUSTEE 1/25/2000
DAVID R. ROCHAT
__________**____________ TRUSTEE 1/25/2000
D. WAYNE SILBY
** SIGNED BY SUSAN WALKER BENDER PURSUANT TO POWER OF ATTORNEY,
ATTACHED HERETO.
CALVERT CASH RESERVES
DECLARATION OF TRUST
ARTICLE I NAME AND DEFINITIONS 1
1. NAME 1
2. DEFINITIONS -
(A) AFFILIATED PERSON, ASSIGNMENT,
COMMISSION, INTERESTED PERSON,
MAJORITY SHAREHOLDER NOTE, PRINCIPAL
UNDERWRITER 1
(B) TRUST 1
(C) ACCUMULATED NET INCOME 1
(D) SHAREHOLDER 1
(E) TRUSTEES 1
(F) SHARES 2
(G) 1940 ACT 2
(H) COMMISSION 2
(I) BUSINESS DAY 2
ARTICLE II PURPOSE OF TRUST 2
ARTICLE III BENEFICIAL INTEREST 2
1. SHARES OF BENEFICIAL INTEREST 2
2. OWNERSHIP OF SHARES 3
3. INVESTMENT IN THE TRUST 3
4. NO PRE-EMPTIVE RIGHTS 4
5. PROVISIONS RELATING TO SERIES OF SHARES 4
ARTICLE IV THE TRUSTEES 5
1. MANAGEMENT OF THE TRUST 5
2 ELECTION OF TRUSTEES 5
3. TERM OF OFFICE OF TRUSTEES 5
4. TERMINATION OF SERVICE AND
APPOINTMENT OF TRUSTEES 6
5. TEMPORARY ABSENCE OF TRUSTEE 6
6. NUMBER OF TRUSTEES 6
7. EFFECT OF DEATH, RESIGNATION, ETC.
OF A TRUSTEE 7
8. OWNERSHIP OF THE TRUST 7
ARTICLE V POWERS OF THE TRUSTEES 7
1. POWERS 7
2. TRUSTEES AND OFFICERS AS SHAREHOLDERS 10
3. PARTIES TO CONTRACT 10
ARTICLE VI TRUSTEES' EXPENSES AND COMPENSATION 11
1. TRUSTEE REIMBURSEMENT 11
2. TRUSTEE COMPENSATION 12
ARTICLE VII INVESTMENT ADVISER, ADMINISTRATIVE
SERVICES, PRINCIPAL UNDERWRITER AND
TRANSFER AGENT 12
1. INVESTMENT ADVISER 12
2. ADMINISTRATIVE SERVICES 13
3. PRINCIPAL UNDERWRITER 13
4. TRANSFER AGENT 13
ARTICLE VIII SHAREHOLDERS' VOTING POWERS AND MEETINGS 14
1. VOTING POWERS 14
2. MEETINGS 14
3. QUORUM AND REQUIRED VOTE 14
4. PROXIES 15
5. ADDITIONAL PROVISIONS 15
ARTICLE IX CUSTODIANS 15
1. APPOINTMENT OF CUSTODIAN AND DUTIES 15
2. CENTRAL CERTIFICATE SYSTEM 16
3. SPECIAL CUSTODIANS 16
4. SPECIAL DEPOSITORIES 17
ARTICLE X DISTRIBUTIONS AND REDEMPTIONS 17
1. DISTRIBUTIONS 17
2. REDEMPTIONS AND REPURCHASES 18
3. DETERMINATION OF ACCUMULATED NET INCOME 19
4. NET ASSET VALUE OF SHARES 19
5. SUSPENSION OF THE RIGHT OF REDEMPTION 20
6. TRUST'S RIGHT TO REDEEM SHARES 20
ARTICLE XI LIMITATION OF LIABILITY AND INDEMNIFICATION 21
1. LIMITATION OF PERSONAL LIABILITY AND
INDEMNIFICATION OF SHAREHOLDERS 21
2. LIMITATION OF PERSONAL LIABILITY OF
TRUSTEES, OFFICERS, EMPLOYEES OR
AGENTS OF THE TRUST 22
3. EXPRESS EXCULPATORY CLAUSES AND INSTRUMENTS 22
4. MANDATORY INDEMNIFICATION 23
ARTICLE XII MISCELLANEOUS 24
1. TRUST IS NOT A PARTNERSHIP 24
2. TRUSTEE'S GOOD FAITH ACTION, EXPERT
ADVICE, NO BOND OR SURETY 24
3. ESTABLISHMENT OF RECORD DATES 24
4. TERMINATION OF TRUST 25
5. OFFICES OF THE TRUST, FILING OF COPIES
REFERENCES, HEADINGS 25
6. APPLICABLE LAW 26
7. AMENDMENTS 26
8. CONFLICTS WITH LAW OR REGULATIONS 27
9. USE OF NAME 27
CALVERT CASH RESERVES
DECLARATION OF TRUST
DECLARATION OF TRUST MADE THIS 16TH DAY OF MARCH, 1982, BY JOHN G. GUFFEY, JR.,
AND D. WAYNE SILBY.
WHEREAS, THE TRUSTEES DESIRE TO ESTABLISH A TRUST FUND FOR THE INVESTMENT AND
REINVESTMENT OF FUNDS CONTRIBUTED THERETO;
NOW, THEREFORE, THE TRUSTEES DECLARE THAT ALL MONEY AND PROPERTY CONTRIBUTED TO
THE TRUST FUND HEREUNDER SHALL BE HELD AND MANAGED UNDER THIS DECLARATION OF
TRUST IN TRUST AS HEREIN SET FORTH BELOW.
ARTICLE I
NAMES AND DEFINITIONS
SECTION I. NAME. THIS TRUST SHALL BE KNOWN AS "CALVERT CASH RESERVES." SHOULD
THE TRUSTEES DETERMINE THAT THE USE OF SUCH NAME IS NOT ADVISABLE OR OTHERWISE
CEASE USING SUCH NAME, THEN THEY MAY HOLD THE PROPERTY OF THE TRUST AND CONDUCT
ITS BUSINESS UNDER ANOTHER NAME OF THEIR CHOOSING, AND SHALL UNDERTAKE TO CHANGE
THE NAME OF THE TRUST ACCORDINGLY.
SECTION 2. DEFINITIONS. WHEREVER USED HEREIN, UNLESS OTHERWISE REQUIRED BY THE
CONTEXT OR SPECIFICALLY PROVIDED:
(A) THE TERMS "AFFILIATED PERSON", "ASSIGNMENT", "INTERESTED PERSON",
"MAJORITY SHAREHOLDER VOTE" (THE 67% OR 5O% REQUIREMENT OF THE THIRD SENTENCE OF
SECTION 2(A) (42) OF THE 1940 ACT, WHICHEVER MAY BE APPLICABLE), AND "PRINCIPAL
UNDERWRITER" SHALL HAVE THE MEANINGS GIVEN THEM IN THE INVESTMENT COMPANY ACT OF
1940, AS AMENDED FROM TIME TO TIME;
(B) THE "TRUST" REFERS TO CALVERT CASH RESERVES;
(C) "ACCUMULATED NET INCOME" MEANS THE ACCUMULATED NET INCOME OF THE TRUST
DETERMINED IN THE MANNER PROVIDED OR AUTHORIZED IN ARTICLE X, SECTION 3;
(D) "SHAREHOLDER" MEANS A RECORD OWNER OF SHARES OF THE TRUST;
(E)1 THE "TRUSTEES" REFERS TO THE INDIVIDUAL TRUSTEES IN THEIR CAPACITY AS
TRUSTEES HEREUNDER OF THE TRUST AND THEIR SUCCESSOR OR SUCCESSORS FOR THE TIME
BEING IN OFFICE AS SUCH TRUSTEES;
(F) "SHARES" MEANS THE EQUAL PROPORTIONATE UNITS OF INTEREST INTO WHICH THE
BENEFICIAL INTEREST IN THE TRUST SHALL BE DIVIDED FROM TIME TO TIME AND INCLUDES
FRACTIONS OF SHARES AS WELL AS WHOLE SHARES;
(G) THE "1940 ACT" REFERS TO THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED
FROM TIME TO TIME;
(H) THE "COMMISSION" REFERS TO THE COMMISSION DESCRIBED IN THE 1940 ACT AND
TO ANY SUCCEEDING GOVERNMENTAL AUTHORITY; AND
(I) A "BUSINESS DAY" MEANS A DAY WHEN THE NEW YORK STOCK EXCHANGE IS OPEN
FOR TRADING AND THE TRUSTEES HAVE NOT DETERMINED THAT THE TRUST SHALL BE CLOSED
FOR BUSINESS IN OBSERVANCE OF A HOLIDAY OBSERVED GENERALLY BY BANKS IN NEW YORK
CITY, WASHINGTON, D.C., OR BY THE OFFICES OF THE FEDERAL GOVERNMENT IN
WASHINGTON, D.C.
ARTICLE II
PURPOSE OF TRUST
THIS TRUST IS ORGANIZED TO OPERATE AS AN INVESTMENT COMPANY REGISTERED UNDER THE
1940 ACT FOR THE PURPOSE OF INVESTING AND REINVESTING ITS ASSETS IN SECURITIES.
ARTICLE III
BENEFICIAL INTEREST
SECTION 1. SHARES OF BENEFICIAL INTEREST. THE
BENEFICIAL INTEREST IN THE TRUST SHALL AT ALL TIMES BE DIVIDED INTO TRANSFERABLE
SHARES, WITHOUT PAR VALUE, EACH OF WHICH SHALL REPRESENT AN EQUAL PROPORTIONATE
INTEREST IN THE TRUST WITH EACH OTHER SHARE OUTSTANDING, NONE HAVING PRIORITY OR
PREFERENCE OVER ANOTHER, EXCEPT TO THE EXTENT MODIFIED BY THE TRUSTEES UNDER THE
PROVISIONS OF THIS SECTION. THE NUMBER OF SHARES WHICH MAY BE ISSUED IS
UNLIMITED. THE TRUSTEES MAY FROM TIME TO TIME DIVIDE OR COMBINE THE OUTSTANDING
SHARES INTO A GREATER OR LESSER NUMBER WITHOUT THEREBY CHANGING THE
PROPORTIONATE BENEFICIAL INTEREST IN THE TRUST. CONTRIBUTIONS TO THE TRUST MAY
BE ACCEPTED FOR, AND SHARES SHALL BE REDEEMED AS, WHOLE SHARES AND/OR FRACTIONS.
SHARES MAY BE REPRESENTED BY CERTIFICATES OR BY SUITABLE ENTRIES IN THE BOOKS OF
THE TRUST
FROM TIME TO TIME AS THEY DEEM APPROPRIATE, THE TRUSTEES MAY CREATE SERIES
AND/OR CLASSES OF SHARES. REFERENCES IN THIS DECLARATION OF TRUST TO SHARES OF
THE TRUST SHALL APPLY TO EACH SUCH SERIES OF SHARES AND (TO THE EXTENT NOT
INCONSISTENT WITH THE RIGHTS AND RESTRICTIONS OF CLASS) TO EACH SUCH CLASS OF
SHARES, EXCEPT TO THE EXTENT MODIFIED BY THE TRUSTEES UNDER THE PROVISIONS OF
THIS SECTION.
ANY SERIES OF SHARES CREATED HEREUNDER SHALL REPRESENT THE BENEFICIAL INTEREST
IN THE ASSETS (AND RELATED LIABILITIES) ALLOCATED BY THE TRUSTEES TO SUCH SERIES
OF SHARES AND ACQUIRED BY THE TRUST ONLY AFTER CREATION OF THE RESPECTIVE SERIES
OF SHARES AND ONLY ON THE ACCOUNT OF SUCH SERIES. UPON CREATION OF ANY SERIES OF
SHARES, THE TRUSTEES SHALL DESIGNATE IT APPROPRIATELY AND DETERMINE THE
INVESTMENT POLICIES WITH RESPECT TO THE ASSETS ALLOCATED TO SUCH SERIES OF
SHARES, PREFERENCES, REDEMPTION RIGHTS, DIVIDEND RIGHTS, CONVERSION RIGHTS,
LIQUIDATION RIGHTS, VOTING RIGHTS, AND SUCH OTHER RIGHTS AND RESTRICTIONS AS THE
TRUSTEES DEEM APPROPRIATE, TO THE EXTENT NOT INCONSISTENT WITH THE PROVISIONS OF
THIS DECLARATION OF TRUST.
THE TRUSTEES MAY DIVIDE THE SHARES OR ANY SERIES OF SHARES INTO MORE THAN ONE
CLASS. UPON CREATION OF ANY ADDITIONAL CLASS OF SHARES; THE TRUSTEES SHALL
DESIGNATE IT APPROPRIATELY AND DETERMINE ITS PREFERENCES, REDEMPTION RIGHTS,
DIVIDEND RIGHTS, CONVERSION RIGHTS,-LIQUIDATION RIGHTS, VOTING RIGHTS, AND SUCH
OTHER RIGHTS AND RESTRICTIONS AS THE TRUSTEES DEEM APPROPRIATE.
SECTION 2. OWNERSHIP OF SHARES. THE OWNERSHIP OF SHARES SHALL BE RECORDED IN THE
BOOKS OF THE TRUST OR OF A TRANSFER AGENT. THE TRUSTEES MAY MAKE SUCH RULES AS
THEY CONSIDER APPROPRIATE FOR THE TRANSFER OF SHARES AND SIMILAR MATTERS. THE
RECORD BOOKS OF THE TRUST OR ANY TRANSFER AGENT, AS THE CASE MAY BE, SHALL BE
CONCLUSIVE AS TO WHO ARE THE HOLDERS OF SHARES AND AS TO THE NUMBER OF SHARES
HELD FROM TIME TO TIME BY EACH.
SECTION 3. INVESTMENT IN THE TRUST. THE TRUSTEES MAY ACCEPT INVESTMENTS IN THE
TRUST FROM SUCH PERSONS AND ON SUCH TERMS AS THEY MAY FROM TIME TO TIME
AUTHORIZE AND MAY CEASE OFFERING SHARES TO THE PUBLIC AT ANY TIME. AFTER THE
DATE OF THE INITIAL CONTRIBUTION OF CAPITAL TO THE TRUST, THE NUMBER OF SHARES
DETERMINED BY THE TRUSTEES TO REPRESENT THE INITIAL CONTRIBUTION SHALL BE
CONSIDERED AS OUTSTANDING, AND THE AMOUNT RECEIVED BY THE TRUSTEES ON ACCOUNT OF
THE CONTRIBUTION SHALL BE TREATED AS AN ASSET OF THE TRUST. SUBSEQUENT TO SUCH
INITIAL CONTRIBUTION OF CAPITAL, SHARES (INCLUDING SHARES WHICH MAY HAVE BEEN
REDEEMED OR REPURCHASED BY THE TRUST) MAY BE ISSUED OR SOLD AT A PRICE WHICH
WILL NET THE TRUST, BEFORE PAYING ANY TAXES IN CONNECTION WITH SUCH ISSUE OR
SALE, NOT LESS THAN THE NET ASSET VALUE (AS DEFINED IN ARTICLE X, SECTION 4)
HEREOF; PROVIDED, HOWEVER, THAT THE TRUSTEES MAY IN THEIR DISCRETION IMPOSE A
SALES CHARGE UPON INVESTMENTS IN THE TRUST.
SECTION 4. NO PRE-EMPTIVE RIGHTS. SHAREHOLDERS SHALL HAVE NO PRE-EMPTIVE OR
OTHER RIGHT TO SUBSCRIBE TO ANY ADDITIONAL SHARES OR OTHER SECURITIES ISSUED BY
THE TRUST OR THE TRUSTEES.
SECTION 5. PROVISIONS RELATING TO SERIES OF SHARES. WHENEVER NO SHARES
OF A SERIES ARE OUTSTANDING, THEN THE TRUSTEES MAY ABOLISH SUCH SERIES (OR ANY
CLASS OF SHARES OF A SERIES FOR WHICH THERE ARE NO OUTSTANDING SHARES). WHENEVER
MORE THAN ONE SERIES OF SHARES IS OUTSTANDING, THEN THE FOLLOWING PROVISIONS
SHALL APPLY:
(A) ASSETS BELONGING TO EACH SERIES. ALL CONSIDERATION RECEIVED BY THE
TRUST FOR THE ISSUE OR SALE OF SHARES OF A PARTICULAR SERIES, TOGETHER WITH ALL
ASSETS IN WHICH SUCH CONSIDERATION IS INVESTED OR REINVESTED, ALL INCOME,
EARNINGS AND PROCEEDS THEREOF, AND ANY FUNDS DERIVED FROM ANY REINVESTMENT OF
SUCH PROCEEDS, SHALL IRREVOCABLY BELONG TO THAT SERIES FOR ALL PURPOSES, SUBJECT
ONLY TO THE RIGHTS OF AND SHALL BE SO RECORDED UPON THE BOOKS OF THE TRUST. IN
THE EVENT THERE ARE ASSETS, INCOME, EARNINGS, AND PROCEEDS THEREOF WHICH ARE NOT
READILY IDENTIFIABLE AS BELONGING TO A PARTICULAR SERIES, THEN THE TRUSTEES
SHALL ALLOCATE SUCH ITEMS TO THE VARIOUS SERIES THEN EXISTING, IN SUCH MANNER
AND ON SUCH BASIS AS THEY, IN THEIR SOLE DISCRETION, DEEM FAIR AND EQUITABLE.
THE AMOUNT OF EACH SUCH ITEM ALLOCATED TO A PARTICULAR SERIES BY THE TRUSTEES
SHALL THEN BELONG TO THAT SERIES, AND EACH SUCH ALLOCATION SHALL BE CONCLUSIVE
AND BINDING UPON THE SHAREHOLDERS OF ALL SERIES FOR ALL PURPOSES.
(B) LIABILITIES BELONGING TO EACH SERIES. THE ASSETS BELONGING TO EACH
PARTICULAR SERIES SHALL BE CHARGED WITH THE LIABILITIES, EXPENSES, COSTS AND
RESERVES OF THE TRUST ATTRIBUTABLE TO THAT SERIES; ANY GENERAL LIABILITIES,
EXPENSES, COSTS AND RESERVES OF THE TRUST WHICH ARE NOT READILY IDENTIFIABLE AS
ATTRIBUTABLE TO A PARTICULAR SERIES SHALL BE ALLOCATED BY THE TRUSTEES TO THE
VARIOUS SERIES THEN EXISTING, IN SUCH MANNER AND ON SUCH BASIS AS THEY, IN THEIR
SOLE DISCRETION, DEEM FAIR AND EQUITABLE. EACH SUCH ALLOCATION SHALL BE
CONCLUSIVE AND BINDING UPON THE SHAREHOLDERS OF ALL SERIES FOR ALL PURPOSES.
(C) SERIES SHARES, DIVIDENDS AND LIQUIDATION. EACH SHARE OF EACH
RESPECTIVE CLASS OF A SERIES SHALL HAVE THE SAME RIGHTS AND PRO RATA BENEFICIAL
INTEREST IN THE ASSETS AND LIABILITIES OF THE SERIES AS ANY OTHER SUCH SHARE.
ANY DIVIDENDS PAID ON THE SHARES OF ANY SERIES SHALL ONLY BE PAYABLE FROM AND TO
THE EXTENT OF THE ASSETS (NET OF LIABILITIES) BELONGING TO THAT SERIES. IN THE
EVENT OF LIQUIDATION OF A SERIES, ONLY THE ASSETS (LESS PROVISION FOR
LIABILITIES) OF THAT SERIES SHALL BE DISTRIBUTED TO THE HOLDERS OF THE SHARES OF
THAT SERIES.
(D) VOTING BY SERIES. EXCEPT AS PROVIDED IN THIS SECTION OR AS LIMITED BY
THE RIGHTS AND RESTRICTIONS OF ANY CLASS, EACH SHARE OF THE TRUST SHALL VOTE
WITH AND IN THE SAME MANNER AS ANY OTHER SHARE ON MATTERS SUBMITTED TO A VOTE OF
THE SHAREHOLDERS, WITHOUT DIFFERENTIATION AMONG VOTES FROM THE SEPARATE SERIES;
PROVIDED, HOWEVER, THAT (I) AS TO ANY MATTER WITH RESPECT TO WHICH A SEPARATE
VOTE OF ANY SERIES IS REQUIRED BY THE 1940 ACT OR WOULD BE REQUIRED UNDER THE
MASSACHUSETTS BUSINESS CORPORATION LAW IF THE TRUST WERE A MASSACHUSETTS
BUSINESS CORPORATION, SUCH REQUIREMENTS AS TO A SEPARATE VOTE BY THE SERIES
SHALL APPLY IN LIEU OF THE VOTING DESCRIBED ABOVE HEREIN; (II) IN THE EVENT THAT
THE SEPARATE VOTE REQUIREMENTS REFERRED TO IN (I) ABOVE APPLY WITH RESPECT TO
ONE OR MORE SERIES, THEN, SUBJECT TO (III) BELOW, THE SHARES OF ALL OTHER SERIES
SHALL VOTE WITHOUT DIFFERENTIATION AMONG THEIR VOTES; AND (III) AS TO ANY MATTER
WHICH DOES NOT AFFECT-THE INTEREST OF A PARTICULAR SERIES, ONLY THE HOLDERS OF
SHARES OF THE ONE OR MORE AFFECTED SERIES SHALL BE ENTITLED TO VOTE.
ARTICLE IV
THE TRUSTEES
SECTION 1. MANAGEMENT OF THE TRUST. THE BUSINESS AND AFFAIRS OF THE TRUST
SHALL BE MANAGED BY THE TRUSTEES, AND THEY SHALL HAVE ALL POWERS NECESSARY AND
DESIRABLE TO CARRY OUT THAT RESPONSIBILITY.
SECTION 2. ELECTION OF TRUSTEES. DURING THE YEAR FOLLOWING THE END OF THE
TRUST'S FIRST FISCAL YEAR SUBSEQUENT TO ITS INITIAL PUBLIC OFFERING OF SHARES,
THE SHAREHOLDERS SHALL ELECT, AT A MEETING CALLED BY THE THEN TRUSTEES OF THE
TRUST, THE TRUSTEES WHO WILL SERVE FOR SUCH REGULAR TERMS AS MAY BE PROVIDED IN
THE BY-LAWS OF THE TRUST.
SECTION 3. TERM OF OFFICE OF TRUSTEES. THE TRUSTEES SHALL HOLD OFFICE
DURING THE LIFETIME OF THIS TRUST, AND UNTIL THE EXPIRATION OF THE TERM OF
OFFICE FOR WHICH EACH WAS ELECTED; EXCEPT THAT (A) ANY TRUSTEE MAY RESIGN HIS
TRUST BY WRITTEN INSTRUMENT SIGNED BY HIM AND DELIVERED TO THE OTHER TRUSTEES,
WHICH SHALL TAKE EFFECT UPON SUCH DELIVERY OR UPON SUCH LATER DATE AS IS
SPECIFIED THEREIN; (B) ANY TRUSTEE MAY BE REMOVED AT ANY TIME BY WRITTEN
INSTRUMENT SIGNED BY AT LEAST TWO-THIRDS OF THE NUMBER OF TRUSTEES PRIOR TO SUCH
REMOVAL, SPECIFYING THE DATE WHEN SUCH REMOVAL SHALL BECOME EFFECTIVE; (C) ANY
TRUSTEE WHO REQUESTS IN WRITING TO BE RETIRED OR WHO HAS BECOME MENTALLY OR
PHYSICALLY INCAPACITATED MAY BE RETIRED BY WRITTEN INSTRUMENT SIGNED BY A
MAJORITY OF THE OTHER TRUSTEES, SPECIFYING THE DATE OF HIS RETIREMENT; AND (D) A
TRUSTEE MAY BE REMOVED AT ANY SPECIAL MEETING OF SHAREHOLDERS OF THE TRUST BY A
VOTE OF TWO-THIRDS OF THE OUTSTANDING SHARES.
SECTION 4. TERMINATION OF SERVICE AND APPOINTMENT OF TRUSTEES. IN CASE OF THE
DEATH, RESIGNATION, RETIREMENT, REMOVAL OR MENTAL OR PHYSICAL INCAPACITY OF ANY
OF THE TRUSTEES, OR IN CASE A VACANCY SHALL, BY REASON OF AN INCREASE IN NUMBER,
OR FOR ANY OTHER REASON, EXIST, THE REMAINING TRUSTEES SHALL FILL SUCH VACANCY
BY APPOINTING FOR THE REMAINING TERM OF THE PREDECESSOR TRUSTEE SUCH OTHER
PERSON AS THEY IN THEIR DISCRETION SHALL SEE FIT. SUCH APPOINTMENT SHALL BE
EFFECTED BY THE SIGNING OF A WRITTEN INSTRUMENT BY A MAJORITY OF THE TRUSTEES IN
OFFICE. WITHIN THREE MONTHS OF SUCH APPOINTMENT, THE TRUSTEES SHALL CAUSE NOTICE
OF SUCH APPOINTMENT TO BE MAILED TO EACH SHAREHOLDER AT HIS ADDRESS AS RECORDED
ON THE BOOKS OF THE TRUST. AN APPOINTMENT OF A TRUSTEE MAY BE MADE BY THE
TRUSTEES THEN IN OFFICE AND NOTICE THEREOF MAILED TO SHAREHOLDERS AS AFORESAID
IN ANTICIPATION OF A VACANCY TO OCCUR BY REASON OF RETIREMENT, RESIGNATION OR
INCREASE IN NUMBER OF TRUSTEES EFFECTIVE AT A LATER DATE, PROVIDED THAT SAID
APPOINTMENT SHALL BECOME EFFECTIVE ONLY AT OR AFTER THE EFFECTIVE DATE OF SAID
RETIREMENT, RESIGNATION OR INCREASE IN NUMBER OF TRUSTEES. AS SOON AS ANY
TRUSTEE SO APPOINTED SHALL HAVE ACCEPTED THIS TRUST, THE TRUST ESTATE SHALL VEST
IN THE NEW TRUSTEE OR TRUSTEES, TOGETHER WITH THE CONTINUING TRUSTEES, WITHOUT
ANY FURTHER ACT OR CONVEYANCE, AND HE SHALL BE DEEMED A TRUSTEE HEREUNDER. ANY
APPOINTMENT AUTHORIZED BY THIS SECTION 4 IS SUBJECT TO THE PROVISIONS OF SECTION
16(A) OF THE 1940 ACT.
SECTION 5. TEMPORARY ABSENCE OF TRUSTEE. ANY TRUSTEE MAY, BY POWER OF ATTORNEY,
DELEGATE HIS POWER FOR A PERIOD NOT EXCEEDING SIX MONTHS AT ANY ONE TIME TO ANY
OTHER TRUSTEE OR TRUSTEES, PROVIDED THAT IN NO CASE SHALL LESS THAN TWO OF THE
TRUSTEES PERSONALLY EXERCISE THEIR POWER HEREUNDER, EXCEPT AS HEREIN OTHERWISE
EXPRESSLY PROVIDED.
SECTION 6. NUMBER OF TRUSTEES. THE NUMBER OF TRUSTEES SERVING HEREUNDER AT ANY
TIME SHALL BE DETERMINED BY THE TRUSTEES THEMSELVES, BUT ONCE SHARES HAVE BEEN
ISSUED SHALL NOT BE LESS THAN THREE (3) NOR MORE THAN FIFTEEN (15).
WHENEVER A VACANCY IN THE BOARD OF TRUSTEES SHALL OCCUR, UNTIL SUCH
VACANCY IS FILLED OR WHILE ANY TRUSTEE IS PHYSICALLY OR MENTALLY INCAPACITATED,
THE OTHER TRUSTEES SHALL HAVE ALL THE POWERS HEREUNDER AND THE CERTIFICATE
SIGNED BY A MAJORITY OF THE OTHER TRUSTEES OF SUCH VACANCY, ABSENCE OR
INCAPACITY, SHALL BE CONCLUSIVE, PROVIDED, HOWEVER, THAT NO VACANCY WHICH
REDUCES THE NUMBER OF TRUSTEES BELOW THREE (3) SHALL REMAIN UNFILLED FOR A
PERIOD LONGER THAN SIX CALENDAR MONTHS
SECTION 7. EFFECT OF DEATH, RESIGNATION, ETC., OF A TRUSTEE. THE
DEATH, RESIGNATION, RETIREMENT, REMOVAL , OR MENTAL OR PHYSICAL INCAPACITY OF
THE TRUSTEES, OR ANY ONE OF THEM, SHALL NOT OPERATE TO ANNUL THE TRUST OR TO
REVOKE ANY EXISTING AGENCY CREATED PURSUANT TO THE TERMS OF THIS DECLARATION OF
TRUST.
SECTION 8. OWNERSHIP OF THE TRUST. THE ASSETS OF THE TRUST SHALL BE
HELD SEPARATE AND APART FROM ANY ASSETS NOW OR HEREAFTER HELD IN ANY CAPACITY
OTHER THAN AS TRUSTEE HEREUNDER BY THE TRUSTEES OR BY ANY SUCCESSOR TRUSTEES.
ALL OF THE ASSETS OF THE TRUST SHALL AT ALL TIMES BE CONSIDERED AS VESTED IN THE
TRUSTEES. NO SHAREHOLDER SHALL BE DEEMED TO HAVE SEVERABLE OWNERSHIP IN ANY
INDIVIDUAL ASSET OF THE TRUST OR ANY RIGHT OF PARTITION OR POSSESSION THEREOF,
BUT EACH SHAREHOLDER SHALL HAVE A PROPORTIONATE UNDIVIDED BENEFICIAL INTEREST IN
THE TRUST.
ARTICLE V
POWERS OF THE TRUSTEES
SECTION 1. POWERS. THE TRUSTEES IN ALL INSTANCES SHALL ACT AS PRINCIPALS,
AND ARE AND SHALL BE FREE FROM THE CONTROL OF THE SHAREHOLDERS. THE TRUSTEES
SHALL HAVE FULL POWER AND AUTHORITY TO DO ANY AND ALL ACTS AND TO MAKE AND
EXECUTE ANY AND ALL CONTRACT AND INSTRUMENTS THAT THEY MAY CONSIDER NECESSARY OR
APPROPRIATE IN CONNECTION WITH THE MANAGEMENT OF THE TRUST. THE TRUSTEES SHALL
NOT BE BOUND OR LIMITED BY PRESENT OR FUTURE LAWS OR CUSTOMS IN REGARD TO
INVESTMENT BY TRUSTEES OR FIDUCIARIES, BUT SHALL HAVE FULL AUTHORITY AND POWER
TO MAKE ANY AND ALL INVESTMENTS WHICH THEY, IN THEIR UNCONTROLLED DISCRETION,
SHALL DEEM PROPER TO ACCOMPLISH THE PURPOSE OF THIS TRUST. WITHOUT LIMITING THE
FOREGOING, THE TRUSTEES SHALL HAVE THE FOLLOWING SPECIFIC POWERS AND AUTHORITY,
SUBJECT TO ANY APPLICABLE LIMITATION IN THIS DECLARATION OF TRUST OR IN THE
BY-LAWS OF THE TRUST.
(A) TO BUY, AND INVEST FUNDS OF THE TRUST, IN SECURITIES INCLUDING, BUT NOT
LIMITED TO, COMMON STOCKS, PREFERRED STOCKS, BONDS, DEBENTURES, WARRANTS AND
RIGHTS TO PURCHASE SECURITIES, OPTIONS, CERTIFICATES OF BENEFICIAL INTEREST,
MONEY MARKET INSTRUMENTS, NOTES OR OTHER EVIDENCES OF INDEBTEDNESS ISSUED BY
CORPORATIONS, TRUSTS, ASSOCIATIONS, OR BANKING INSTITUTIONS, DOMESTIC OR
FOREIGN, OR ISSUED OR GUARANTEED BY THE UNITED STATES OF AMERICA OR ANY AGENCY
OR INSTRUMENTALITY THEREOF, BY THE GOVERNMENT OF ANY FOREIGN COUNTRY, BY ANY
STATE OF THE UNITED STATES (INCLUDING THE DISTRICT OF COLUMBIA, PUERTO RICO AND
GUAM) OR BY ANY POLITICAL SUBDIVISION OR AGENCY OR INSTRUMENTALITY OF ANY STATE
OR FOREIGN COUNTRY, OR IN "WHEN-ISSUED" OR "DELAYED-DELIVERY" CONTACTS FOR ANY
SUCH SECURITIES, OR IN ANY REPURCHASE AGREEMENT (AGREEMENTS UNDER WHICH THE
SELLER AGREES AT THE TIME OF SALE TO REPURCHASE THE SECURITY AT AN AGREED TIME
AND PRICE); OR RETAIN TRUST ASSETS IN CASH, AND FROM TIME TO TIME CHANGE THE
INVESTMENTS CONSTITUTING THE ASSETS OF THE TRUST;
(B) TO ADOPT BY-LAWS NOT INCONSISTENT WITH THE DECLARATION OF TRUST
PROVIDING FOR THE CONDUCT OF THE BUSINESS OF THE TRUST AND TO AMEND AND REPEAL
THEM TO THE EXTENT THAT THEY DO NOT RESERVE THAT RIGHT TO THE SHAREHOLDERS;
(C) TO ELECT AND REMOVE SUCH OFFICERS AND APPOINT AND TERMINATE SUCH AGENTS
AS THEY CONSIDER APPROPRIATE;
(D) TO APPOINT OR OTHERWISE ENGAGE ONE OR MORE BANKS OR TRUST COMPANIES OR
MEMBER FIRMS OF ANY NATIONAL SECURITIES EXCHANGE REGISTERED UNDER THE SECURITIES
EXCHANGE ACT OF 1934 AS CUSTODIAN OF ANY ASSETS OF THE TRUST, SUBJECT TO ANY
CONDITIONS SET FORTH IN THIS DECLARATION OF TRUST OR IN THE BY-LAWS.
(E) TO APPOINT OR OTHERWISE ENGAGE CUSTODIAL AGENTS, TRANSFER AGENTS,
DIVIDEND DISBURSING AGENTS, SHAREHOLDER SERVICING AGENTS, INVESTMENT ADVISERS,
SUB-INVESTMENT ADVISERS, PRINCIPAL UNDERWRITERS, ADMINISTRATIVE SERVICE AGENTS,
AND SUCH OTHER AGENTS AS THE TRUSTEES MAY FROM TIME TO TIME APPOINT OR OTHERWISE
ENGAGE;
(F) TO PROVIDE FOR THE DISTRIBUTION OF INTERESTS OF THE TRUST EITHER
THROUGH A PRINCIPAL UNDERWRITER IN THE MANNER HEREINAFTER PROVIDED FOR OR BY THE
TRUST ITSELF, OR BOTH;
(G) TO SET RECORD DATES IN THE MANNER HEREINAFTER PROVIDED FOR;
(H) TO DELEGATE SUCH AUTHORITY AS THEY CONSIDER DESIRABLE TO A COMMITTEE OR
COMMITTEES COMPOSED OF TRUSTEES, INCLUDING WITHOUT LIMITATION, AN EXECUTIVE
COMMITTEE, OR TO ANY OFFICERS OF THE TRUST AND TO ANY AGENT, CUSTODIAN OR
UNDERWRITER;
(I) TO SELL OR EXCHANGE ANY OR ALL OF THE ASSETS OF THE TRUST, SUBJECT TO THE
PROVISIONS OF ARTICLE XII, SECTION 4(B) HEREOF;
(J) TO VOTE OR GIVE ASSENT, OR EXERCISE ANY RIGHTS OF OWNERSHIP, WITH RESPECT TO
STOCK OR OTHER SECURITIES OR PROPERTY; AND TO EXECUTE AND DELIVER POWERS OF
ATTORNEY TO SUCH PERSON OR PERSONS AS THE TRUSTEES SHALL DEEM PROPER, GRANTING
TO SUCH PERSON OR PERSONS SUCH POWER AND DISCRETION WITH RELATION TO SECURITIES
OR PROPERTY AS THE TRUSTEES SHALL DEEM PROPER;
(K) TO EXERCISE POWERS AND RIGHTS OF SUBSCRIPTION OR OTHERWISE WHICH IN ANY
MANNER ARISE OUT OF OWNERSHIP OF SECURITIES;
(1) TO HOLD ANY SECURITY OR PROPERTY IN A FORM NOT INDICATING ANY TRUST, WHETHER
IN BEARER, UNREGISTERED OR OTHER NEGOTIABLE FORM; OR EITHER IN ITS OWN NAME OR
IN THE NAME OF A CUSTODIAN OR A NOMINEE OR NOMINEES, SUBJECT IN EITHER CASE TO
PROPER SAFEGUARDS ACCORDING TO THE USUAL PRACTICE OF MASSACHUSETTS TRUST
COMPANIES OR INVESTMENT COMPANIES;
(M) TO CONSENT TO OR PARTICIPATE IN ANY PLAN FOR THE REORGANIZATION,
CONSOLIDATION OR MERGER OF ANY CORPORATION OR CONCERN, ANY SECURITY OF WHICH IS
HELD IN THE TRUST; TO CONSENT TO ANY CONTRACT, LEASE, MORTGAGE, PURCHASE, OR
SALE OF PROPERTY BY SUCH CORPORATION OR CONCERN, AND TO PAY CALLS OR
SUBSCRIPTIONS WITH RESPECT TO ANY SECURITY HELD IN THE TRUST.
(N) TO ENGAGE IN AND TO PROSECUTE, COMPOUND, COMPROMISE, ABANDON, OR ADJUST,
BY ARBITRATION, OR OTHERWISE, ANY ACTIONS, SUITS, PROCEEDINGS, DISPUTES, CLAIMS,
DEMANDS, AND THINGS RELATING TO THE TRUST, AND OUT OF THE ASSETS OF THE TRUST TO
PAY, OR TO SATISFY, ANY DEBTS, CLAIMS OR EXPENSES INCURRED IN CONNECTION
THEREWITH, INCLUDING THOSE OF LITIGATION, UPON ANY EVIDENCE THAT THE TRUSTEES
MAY DEEM SUFFICIENT (SUCH POWERS SHALL INCLUDE WITHOUT LIMITATION ANY ACTIONS,
SUITS, PROCEEDINGS, DISPUTES, CLAIMS DEMANDS AND THINGS RELATING TO THE TRUST
WHEREIN ANY OF THE TRUSTEES MAY BE NAMED INDIVIDUALLY AND THE SUBJECT MATTER OF
WHICH ARISES BY REASON OF BUSINESS FOR OR ON BEHALF OF THE TRUST);
(O) TO MAKE DISTRIBUTIONS OF INCOME AND OF CAPITAL GAINS TO SHAREHOLDERS IN THE
MANNER HEREINAFTER PROVIDED FOR;
(P) TO BORROW MONEY AND ENTER INTO REVERSE REPURCHASE AGREEMENTS (AGREEMENTS IN
WHICH THE TRUST SELLS ASSETS WHILE CONCURRENTLY AGREEING TO REPURCHASE SUCH
ASSETS AT A LATER DATE
<PAGE>
AT A SPECIFIC PRICE) IF SUCH BORROWINGS ARE MADE TEMPORARILY FOR EXTRAORDINARY
OR EMERGENCY PURPOSES OR TO PERMIT REDEMPTIONS OF SHARES WITHOUT SELLING
PORTFOLIO SECURITIES. ANY BORROWINGS HEREUNDER MAY BE MADE WITH OR WITHOUT
COLLATERAL SECURITY AND THE TRUSTEES MAY, IN THEIR DISCRETION, PLEDGE, MORTGAGE,
CHARGE, HYPOTHECATE OR OTHERWISE ENCUMBER THE GROSS ASSETS OF THE TRUST AS
SECURITY FOR ANY LOANS OR REVERSE REPURCHASE AGREEMENTS, SUBJECT TO THE
LIMITATIONS PROVIDED HEREIN.
(Q) TO LEND PORTFOLIO SECURITIES OF THE TRUST PURSUANT TO POLICIES
ESTABLISHED BY THE TRUSTEES.
(R) TO INVEST IN SECURITIES HAVING LEGAL OR CONTRACTUAL RESTRICTIONS ON
THEIR RESALE OR FOR WHICH NO READILY AVAILABLE MARKET EXISTS.
(S) FROM TIME TO TIME TO ISSUE AND SELL THE SHARES OF THE TRUST EITHER FOR
CASH OR FOR PROPERTY WHENEVER AND IN SUCH AMOUNTS AS THE TRUSTEES MAY DEEM
DESIRABLE, BUT SUBJECT TO THE LIMITATIONS SET FORTH IN SECTION 3 OF ARTICLE III.
(T) TO PURCHASE INSURANCE OF ANY KIND, INCLUDING, WITHOUT LIMITATION,
INSURANCE ON BEHALF OF ANY PERSON WHO IS OR WAS A TRUSTEE, OFFICER, EMPLOYEE OR
AGENT OF THE TRUST, OR IS OR WAS SERVING AT THE REQUEST OF THE TRUST AS A
TRUSTEE, DIRECTOR, OFFICER, AGENT OR EMPLOYEE OF ANOTHER CORPORATION,
PARTNERSHIP, JOINT VENTURE, TRUST OR OTHER ENTERPRISE AGAINST ANY LIABILITY
ASSERTED AGAINST SUCH PERSON AND INCURRED BY SUCH PERSON IN ANY SUCH CAPACITY OR
ARISING OUT OF SUCH PERSON'S STATUS AS SUCH.
NO ONE DEALING WITH THE TRUSTEES SHALL BE UNDER OBLIGATION TO MAKE ANY INQUIRY
CONCERNING THE AUTHORITY OF THE TRUSTEES.
SECTION 2. TRUSTEES AND OFFICERS AS SHAREHOLDERS. ANY TRUSTEE, OFFICER OR OTHER
AGENT OF THE TRUST MAY ACQUIRE, OWN AND DISPOSE OF SHARES OF THE TRUST TO THE
SAME EXTENT AS IF HE WERE NOT A TRUSTEE, OFFICER OR AGENT; AND THE TRUSTEES MAY
ISSUE AND SELL OR CAUSE TO BE ISSUED OR SOLD SHARES OF THE TRUST TO AN
INTERESTED PERSON SUBJECT ONLY TO THE GENERAL LIMITATIONS HEREIN CONTAINED AS TO
THE SALE AND PURCHASE OF SUCH SHARES; AND ALL SUBJECT TO ANY RESTRICTIONS WHICH
MAY BE CONTAINED IN THE BY-LAWS.
SECTION 3. PARTIES TO CONTRACT. THE TRUSTEES MAY ENTER INTO ANY CONTRACT OF THE
CHARACTER DESCRIBED IN SECTION 1, 2, 3, OR 4 OF ARTICLE VII, OR IN ARTICLE IX
HEREOF, OR OF ANY OTHER CHARACTER NOT PROHIBITED BY THE 1940 ACT WITH ANY
CORPORATION, FIRM, TRUST OR ASSOCIATION, ALTHOUGH ONE OR MORE OF THE
SHAREHOLDERS, TRUSTEES, OFFICERS, EMPLOYEES OR AGENTS OF THE TRUST OR THEIR
AFFILIATES MAY BE AN OFFICER, DIRECTOR, TRUSTEE, SHAREHOLDER OR INTERESTED
PERSON OF SUCH OTHER PARTY TO THE CONTRACT, AND NO SUCH CONTRACT SHALL BE
INVALIDATED OR RENDERED VOIDABLE BY REASON OF THE EXISTENCE OF ANY SUCH
RELATIONSHIP, NOR SHALL ANY PERSON HOLDING SUCH RELATIONSHIP RELIABLE 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, IN THE ABSENCE OF ACTUAL FRAUD. THE SAME PERSON (INCLUDING
A FIRM, CORPORATION, TRUST OR ASSOCIATION) MAY BE THE OTHER PARTY TO CONTRACTS
ENTERED INTO PURSUANT TO SECTIONS 1, 2, 3, AND 4 OF ARTICLE VII OR ARTICLE IX OR
ANY OTHER CAPACITY DEEMED LEGAL UNDER THE 1940 ACT, AND ANY INDIVIDUAL MAY BE
FINANCIALLY INTERESTED OR OTHERWISE AN INTERESTED PERSON OF PARTIES TO ANY OR
ALL OF THE CONTRACTS MENTIONED IN THIS SECTION 4.
ARTICLE VI
TRUSTEES' EXPENSES AND COMPENSATION
SECTION 1. TRUSTEE REIMBURSEMENT. THE TRUSTEES SHALL BE REIMBURSED FROM THE
TRUST ESTATE FOR ALL OF THEIR EXPENSES AND DISBURSEMENTS NOT OTHERWISE
REIMBURSED, INCLUDING, WITHOUT LIMITATION, EXPENSES OF ORGANIZING THE TRUST AND
CONTINUING ITS EXISTENCE; FEES AND EXPENSES OF TRUSTEES AND OFFICERS OF THE
TRUST; FEES FOR INVESTMENT ADVISORY SERVICES, ADMINISTRATIVE SERVICES AND
PRINCIPAL UNDERWRITING SERVICES PROVIDED FOR IN ARTICLE VII, SECTIONS 1, 2, AND
3; FEES AND EXPENSES OF PREPARING AND PRINTING ITS REGISTRATION STATEMENTS UNDER
THE SECURITIES ACT OF 1933 AND THE INVESTMENT COMPANY ACT OF 1940 AND ANY
AMENDMENTS THERETO; EXPENSES OF REGISTERING AND QUALIFYING THE TRUST AND ITS
SHARES UNDER FEDERAL AND STATE LAWS AND REGULATIONS; EXPENSES OF PREPARING,
PRINTING AND DISTRIBUTING PROSPECTUSES AND ANY AMENDMENTS THEREOF SENT TO
SHAREHOLDERS, UNDERWRITERS, BROKER-DEALERS AND TO INVESTORS WHO MAY BE
CONSIDERING THE PURCHASE OF SHARES; EXPENSES OF REGISTERING, LICENSING OR OTHER
AUTHORIZATION OF THE TRUST AS A BROKER-DEALER AND OF ITS OFFICERS AS AGENTS AND
SALESMEN UNDER FEDERAL AND STATE LAWS AND REGULATIONS; INTEREST EXPENSE, TAXES,
FEES AND COMMISSIONS OF EVERY KIND; EXPENSES OF ISSUE (INCLUDING COST OF SHARE
CERTIFICATES), REPURCHASE AND REDEMPTION OF SHARES, INCLUDING EXPENSES
ATTRIBUTABLE TO A PROGRAM OF PERIODIC ISSUE; CHARGES AND EXPENSES OF CUSTODIANS,
TRANSFER AGENTS, DIVIDEND DISBURSING AGENTS, SHAREHOLDER SERVICING AGENTS AND
REGISTRARS; PRINTING AND MAILING COSTS; AUDITING, ACCOUNTING AND LEGAL EXPENSES;
REPORTS TO SHAREHOLDERS AND GOVERNMENTAL OFFICERS AND COMMISSIONS; EXPENSES OF
MEETINGS OF SHAREHOLDERS AND PROXY SOLICITATIONS THEREFOR; INSURANCE EXPENSES;
ASSOCIATION MEMBERSHIP DUES AND NONRECURRING ITEMS AS MAY ARISE, INCLUDING ALL
LOSSES AND LIABILITIES BY-THEM INCURRED IN ADMINISTERING THE TRUST, INCLUDING
EXPENSES INCURRED IN CONNECTION WITH LITIGATION, PROCEEDINGS AND CLAIMS AND THE
OBLIGATIONS OF THE TRUST UNDER ARTICLE XI HEREOF TO INDEMNIFY ITS TRUSTEES,
OFFICERS, EMPLOYEES, SHAREHOLDERS AND AGENTS, AND FOR THE PAYMENT OF SUCH
EXPENSES, DISBURSEMENTS, LOSSES AND LIABILITIES, THE TRUSTEES SHALL HAVE A LIEN
ON THE TRUST ESTATE PRIOR TO ANY RIGHTS OR INTERESTS OF THE SHAREHOLDERS
THERETO. THIS SECTION SHALL NOT PRECLUDE THE TRUST FROM DIRECTLY PAYING ANY OF
THE AFOREMENTIONED FEES AND EXPENSES.
SECTION 2. TRUSTEES COMPENSATION. THE TRUSTEES SHALL BE ENTITLED TO COMPENSATION
FROM THE TRUST FOR THEIR RESPECTIVE SERVICES AS TRUSTEES, TO BE DETERMINED FROM
TIME TO TIME BY VOTE OF THE TRUSTEES, AND THE TRUSTEES SHALL ALSO DETERMINE THE
COMPENSATION OF ALL OFFICERS, CONSULTANTS AND AGENTS WHO THEY MAY ELECT OR
APPOINT. THE TRUST MAY PAY ANY TRUSTEE OR ANY CORPORATION, FIRM, TRUST OR
ASSOCIATION OF WHICH A TRUSTEE IS AN INTERESTED PERSON FOR SERVICES RENDERED TO
THE TRUST IN ANY CAPACITY NOT PROHIBITED BY THE 1940 ACT, AND SUCH PAYMENTS
SHALL NOT BE DEEMED COMPENSATION FOR SERVICES AS A TRUSTEE UNDER THE FIRST
SENTENCE OF THIS SECTION 2 OF ARTICLE VI.
ARTICLE VII
INVESTMENT ADVISER, ADMINISTRATIVE SERVICES,
PRINCIPAL UNDERWRITER AND TRANSFER AGENT
SECTION 1. INVESTMENT ADVISER. SUBJECT TO A MAJORITY SHAREHOLDER VOTE, THE
TRUSTEES MAY IN THEIR DISCRETION FROM TIME TO TIME ENTER INTO AN INVESTMENT
ADVISORY CONTRACT WHEREBY THE OTHER PARTY TO SUCH CONTRACT SHALL UNDERTAKE TO
FURNISH THE TRUSTEES INVESTMENT ADVISORY SERVICES UPON SUCH TERMS AND CONDITIONS
AND FOR SUCH COMPENSATION AS THE TRUSTEES MAY IN THEIR DISCRETION DETERMINE.
SUBJECT TO A MAJORITY SHAREHOLDER VOTE, THE INVESTMENT ADVISER MAY ENTER INTO A
SUB-INVESTMENT ADVISORY CONTRACT TO RECEIVE INVESTMENT ADVICE, STATISTICAL AND
FACTUAL INFORMATION FROM THE SUB-INVESTMENT ADVISER UPON SUCH TERMS AND
CONDITIONS AND FOR SUCH COMPENSATION AS THE TRUSTEES MAY IN THEIR DISCRETION
AGREE TO. NOTWITHSTANDING ANY PROVISIONS OF THIS DECLARATION OF TRUST, THE
TRUSTEES MAY AUTHORIZE THE INVESTMENT ADVISER OR SUB-INVESTMENT ADVISER OR ANY
PERSON FURNISHING ADMINISTRATIVE PERSONNEL AND SERVICES AS SET FORTH IN ARTICLE
VII, SECTION 2 (SUBJECT TO SUCH GENERAL OR SPECIFIC INSTRUCTIONS AS THE TRUSTEES
MAY FROM TIME TO TIME ADOPT) TO EFFECT PURCHASES, SALES OR EXCHANGES OF
PORTFOLIO SECURITIES OF THE TRUST ON BEHALF OF THE TRUSTEES OR MAY AUTHORIZE ANY
OFFICER OR TRUSTEE TO EFFECT SUCH PURCHASES, SALES OR EXCHANGES PURSUANT TO
RECOMMENDATIONS OF THE INVESTMENT ADVISER (AND ALL WITHOUT FURTHER ACTION BY THE
TRUSTEES). ANY SUCH PURCHASES, SALES AND EXCHANGES SHALL BE DEEMED TO HAVE BEEN
AUTHORIZED BY THE TRUSTEES. THE TRUSTEES MAY ALSO AUTHORIZE THE INVESTMENT
ADVISER TO DETERMINE WHAT FIRMS SHALL BE EMPLOYED TO EFFECT TRANSACTIONS IN
SECURITIES FOR THE ACCOUNT OF THE TRUST AND TO DETERMINE WHAT FIRMS SHALL
PARTICIPATE IN ANY SUCH TRANSACTIONS OR SHALL SHARE IN COMMISSIONS OR FEES
CHARGED IN CONNECTION WITH SUCH TRANSACTIONS.
SECTION 2. ADMINISTRATIVE SERVICES. THE TRUSTEES MAY IN THEIR DISCRETION FROM
TIME TO TIME CONTRACT FOR ADMINISTRATIVE PERSONNEL AND SERVICES WHEREBY THE
OTHER PARTY SHALL AGREE TO PROVIDE THE TRUSTEES ADMINISTRATIVE PERSONNEL AND
SERVICES TO OPERATE THE TRUST ON A DAILY BASIS, ON SUCH TERMS AND CONDITIONS AS
THE TRUSTEES MAY IN THEIR DISCRETION DETERMINE. SUCH SERVICES MAY BE PROVIDED BY
ONE OR MORE ENTITIES.
SECTION 3. PRINCIPAL UNDERWRITER. THE TRUSTEES MAY IN THEIR DISCRETION FROM TIME
TO TIME ENTER INTO AN EXCLUSIVE OR NON-EXCLUSIVE CONTRACT OR CONTRACTS PROVIDING
FOR THE SALE OF THE SHARES OF THE TRUST TO NET THE TRUST NOT LESS THAN THE
AMOUNT PROVIDED IN ARTICLE III, SECTION 3 HEREOF, WHEREBY THE TRUST MAY EITHER
AGREE TO SELL THE SHARES TO THE OTHER PARTY TO THE CONTRACT OR APPOINT SUCH
OTHER 'PARTY ITS SALES AGENT FOR SUCH SHARES. IN EITHER CASE, THE CONTRACT SHALL
BE ON SUCH TERMS AND CONDITIONS AS THE TRUSTEES MAY IN THEIR DISCRETION
DETERMINE NOT INCONSISTENT WITH THE PROVISIONS OF THIS ARTICLE VII; AND SUCH
CONTRACTS MAY ALSO PROVIDE FOR THE REPURCHASE OR SALES OF SHARES OF THE TRUST BY
SUCH OTHER PARTY AS PRINCIPAL OR AS AGENT OF THE TRUST AND MAY PROVIDE THAT THE
OTHER PARTY MAY MAINTAIN A MARKET FOR SHARES OF THE TRUST.
SECTION 4. TRANSFER AGENT. THE TRUSTEES MAY IN THEIR DISCRETION FROM TIME TO
TIME ENTER INTO TRANSFER AGENCY AND SHAREHOLDER SERVICES CONTRACTS WHEREBY THE
OTHER PARTY SHALL UNDERTAKE TO FURNISH THE TRUSTEES TRANSFER AGENCY AND
SHAREHOLDER SERVICES. THE CONTRACTS SHALL BE ON SUCH TERMS AND CONDITIONS AS THE
TRUSTEES MAY IN THEIR DISCRETION DETERMINE NOT INCONSISTENT WITH THE PROVISIONS
OF THIS DECLARATION OF TRUST. SUCH SERVICES MAY BE PROVIDED BY ONE OR MORE
ENTITIES.
ARTICLE VIII
SHAREHOLDERS' VOTING POWERS AND MEETINGS
SECTION 1. VOTING POWERS. THE SHAREHOLDERS SHALL HAVE POWER TO VOTE (I) FOR THE
ELECTION OF TRUSTEES AS PROVIDED IN ARTICLE IV, SECTION 2; (II) FOR THE REMOVAL
OF TRUSTEES AS PROVIDED IN ARTICLE IV, SECTION 3(D); (III) WITH RESPECT TO ANY
INVESTMENT ADVISER OR SUB-INVESTMENT ADVISER AS PROVIDED IN ARTICLE VII, SECTION
1; (IV) WITH RESPECT TO THE AMENDMENT OF THIS DECLARATION OF TRUST AS PROVIDED
IN ARTICLE XII, SECTION 7; (V) TO THE SAME EXTENT AS THE SHAREHOLDERS OF A
MASSACHUSETTS BUSINESS CORPORATION AS TO WHETHER OR NOT A COURT ACTION,
PROCEEDING OR CLAIM SHOULD BE BROUGHT OR MAINTAINED DERIVATIVELY OR AS A CLASS
ACTION ON BEHALF OF THE TRUST OR THE SHAREHOLDERS; AND (VI) WITH RESPECT TO SUCH
ADDITIONAL MATTERS RELATING TO THE TRUST AS MAY BE REQUIRED BY LAW, BY THIS
DECLARATION OF TRUST, OR BY BY-LAWS OF THE TRUST OR ANY REGULATION OF THE TRUST
BY THE COMMISSION OR ANY STATE, OR AS THE TRUSTEES MAY CONSIDER DESIRABLE. EACH
WHOLE SHARE SHALL BE ENTITLED TO ONE VOTE AS TO ANY MATTER ON WHICH IT IS
ENTITLED TO VOTE, AND EACH FRACTIONAL SHARE SHALL BE ENTITLED TO A PROPORTIONATE
FRACTIONAL VOTE. THERE SHALL BE NO CUMULATIVE VOTING IN THE ELECTION OF
TRUSTEES. UNTIL SHARES ARE ISSUED, THE TRUSTEES MAY EXERCISE ALL RIGHTS OF
SHAREHOLDERS AND MAY TAKE ANY ACTION REQUIRED OR PERMITTED BY LAW, THIS
DECLARATION OF TRUST OR ANY BY-LAWS OF THE TRUST TO BE TAKEN BY SHAREHOLDERS.
SECTION 2. MEETINGS. SHAREHOLDER MEETINGS SHALL BE HELD AS SPECIFIED IN SECTION
2 OF ARTICLE IV AND IN THE BY-LAWS AT THE PRINCIPAL OFFICE OF THE TRUST OR AT
SUCH OTHER PLACE AS THE TRUSTEES MAY DESIGNATE. SPECIAL MEETINGS OF THE
SHAREHOLDERS MAY BE CALLED BY THE TRUSTEES OR BY OFFICERS OF THE TRUST GIVEN
SUCH AUTHORITY IN THE BY-LAWS AND SHALL BE CALLED BY THE TRUSTEES AT A PLACE
DESIGNATED BY THEM UPON THE WRITTEN REQUEST OF SHAREHOLDERS OWNING AT LEAST
ONE-TENTH OF THE OUTSTANDING SHARES ENTITLED TO VOTE. SHAREHOLDERS SHALL BE
ENTITLED TO AT LEAST TEN DAYS' NOTICE OF ANY MEETING.
SECTION 3. QUORUM AND REQUIRED VOTE. EXCEPT AS OTHERWISE PROVIDED BY LAW, TO
CONSTITUTE A QUORUM FOR THE TRANSACTION OF ANY BUSINESS AT ANY MEETING OF
SHAREHOLDERS THERE MUST BE PRESENT, IN PERSON OR BY PROXY, HOLDERS OF ONE-FOURTH
OF THE TOTAL NUMBER OF SHARES OF THE TRUST THEN OUTSTANDING AND ENTITLED TO VOTE
AT SUCH MEETING. IF A QUORUM, AS ABOVE DEFINED, SHALL NOT BE PRESENT FOR THE
PURPOSE OF ANY VOTE THAT MAY PROPERLY COME BEFORE THE MEETING, THE SHAREHOLDERS
PRESENT IN PERSON OR BY PROXY AND ENTITLED TO VOTE AT SUCH MEETING ON SUCH
MATTER HOLDING A MAJORITY OF THE SHARES PRESENT ENTITLED TO VOTE ON SUCH MATTER
MAY BY VOTE ADJOURN THE MEETING FROM TIME TO TIME TO HE HELD AT THE SAME PLACE
WITHOUT FURTHER NOTICE THAN BY ANNOUNCEMENT TO BE GIVEN AT THE MEETING UNTIL A
QUORUM, AS ABOVE DEFINED, ENTITLED TO VOTE ON SUCH MATTER SHALL HE PRESENT,
WHEREUPON ANY SUCH MATTER MAY BE VOTED UPON AT THE MEETING AS THOUGH HELD WHEN
ORIGINALLY CONVENED. SUBJECT TO ANY APPLICABLE REQUIREMENT OF LAW OR OF THIS
DECLARATION OF TRUST OR BY THE BY-LAWS, A PLURALITY OF THE VOTES CAST SHALL
ELECT A TRUSTEE AND ALL OTHER MATTERS SHALL BE DECIDED BY A MAJORITY OF THE
VOTES CAST ENTITLED TO VOTE THEREON.
SECTION 4. PROXIES. ANY VOTE BY A SHAREHOLDER OF THE TRUST MAY BE MADE IN PERSON
OR BY PROXY, PROVIDED THAT NO PROXY SHALL BE VOTED AT ANY MEETING UNLESS IT
SHALL HAVE BEEN PLACED ON FILE WITH THE TRUSTEES OR THEIR DESIGNATE PRIOR TO THE
TIME THE VOTE IS TAKEN. PURSUANT TO A RESOLUTION OF A MAJORITY OF THE TRUSTEES,
PROXIES MAY BE SOLICITED IN THE NAME OF ONE OR MORE TRUSTEES OR ONE OR MORE
OFFICERS OF THE TRUST. ONLY SHAREHOLDERS OF RECORD SHALL BE ENTITLED TO VOTE. A
PROXY PURPORTING TO BE EXECUTED BY OR ON BEHALF OF A SHAREHOLDER SHALL BE DEEMED
VALID UNLESS CHALLENGED AT OR PRIOR TO ITS EXERCISE, AND THE BURDEN OF PROVING
INVALIDITY SHALL REST ON THE CHALLENGER.
SECTION 5. ADDITIONAL PROVISIONS. THE BY-LAWS MAY INCLUDE FURTHER PROVISIONS FOR
SHAREHOLDERS' VOTES AND MEETINGS AND RELATED MATTERS.
ARTICLE IX
CUSTODIANS
SECTION 1. APPOINTMENT OF CUSTODIAN AND DUTIES. THE TRUSTEES SHALL APPOINT OR
OTHERWISE ENGAGE A BANK OR TRUST COMPANY HAVING AN AGGREGATE CAPITAL, SURPLUS
AND UNDIVIDED PROFITS (AS SHOWN IN ITS LAST PUBLISHED REPORT) OF AT LEAST TWO
MILLION DOLLARS ($2,000,000) AS ITS CUSTODIAN WITH AUTHORITY AS ITS AGENT, BUT
SUBJECT TO SUCH RESTRICTIONS, LIMITATIONS AND OTHER REQUIREMENTS, IF ANY, AS MAY
BE CONTAINED IN THE BY-LAWS OF THE TRUST:
(1) TO RECEIVE AND HOLD SECURITIES OWNED BY THE TRUST AND DELIVER THE SAME
UPON WRITTEN ORDER;
(2) TO RECEIVE AND RECEIPT FOR ANY MONEYS DUE TO THE TRUST AND DEPOSIT THE
SAME IN ITS OWN BANKING DEPARTMENT OR ELSEWHERE AS THE TRUSTEES MAY DIRECT;
(3) TO DISBURSE SUCH FUNDS UPON ORDERS OR VOUCHERS;
(4) TO KEEP, IF AUTHORIZED TO DO SO BY THE TRUSTEES, THE BOOKS AND ACCOUNTS
OF THE TRUST AND FURNISH CLERICAL AND ACCOUNTING SERVICES; AND
(2) TO COMPUTE, IF AUTHORIZED TO DO SO BY THE TRUSTEES, THE ACCUMULATED NET
INCOME OF THE TRUST AND THE NET ASSET VALUE OF THE SHARES IN ACCORDANCE WITH THE
PROVISIONS HEREOF;
ALL UPON SUCH BASIS OF COMPENSATION AS MAY BE AGREED UPON BETWEEN THE TRUSTEES
AND THE CUSTODIAN. IF SO DIRECTED BY A MAJORITY SHAREHOLDER VOTE, THE CUSTODIAN
SHALL DELIVER AND PAY OVER ALL PROPERTY OF THE TRUST HELD BY IT AS SPECIFIED IN
SUCH VOTE.
THE TRUSTEES MAY ALSO AUTHORIZE THE CUSTODIAN TO EMPLOY ONE OR MORE
SUB-CUSTODIANS FROM TIME TO TIME TO PERFORM SUCH OF THE ACTS AND SERVICES OF THE
CUSTODIAN AND UPON SUCH TERMS AND CONDITIONS, AS MAY BE AGREED UPON BETWEEN THE
CUSTODIAN AND SUCH SUB-CUSTODIAN AND APPROVED BY THE TRUSTEES, PROVIDED THAT IN
EVERY CASE SUCH SUB-CUSTODIAN SHALL BE A BANK OR TRUST COMPANY ORGANIZED UNDER
THE LAWS OF THE UNITED STATES OR ONE OF THE STATES THEREOF AND HAVING AN
AGGREGATE CAPITAL, SURPLUS AND UNDIVIDED PROFITS (AS SHOWN IN ITS LAST PUBLISHED
REPORT) OF AT LEAST TWO MILLION DOLLARS ($2,000,000) OR A MEMBER FIRM OF A
NATIONAL SECURITIES EXCHANGE REGISTERED UNDER THE SECURITIES EXCHANGE ACT OF
1934.
SECTION 2. CENTRAL CERTIFICATE SYSTEM. SUBJECT TO SUCH RULES, REGULATIONS AND
ORDERS AS THE COMMISSION MAY ADOPT, 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, 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
ALL SUCH DEPOSITS SHALL BE SUBJECT TO WITHDRAWAL ONLY UPON THE ORDER OF THE
CUSTODIAN AT THE DIRECTION OF THE TRUSTEES.
SECTION 3. SPECIAL CUSTODIANS. THE TRUSTEES MAY APPOINT OR OTHERWISE ENGAGE ANY
INSTITUTION WHICH WOULD BE PERMITTED TO ACT AS A SUB-CUSTODIAN HEREUNDER TO ACT
AS A SPECIAL CUSTODIAN OF THE TRUST. ANY SPECIAL CUSTODIAN WHICH IS A MEMBER
FIRM OF A NATIONAL SECURITIES EXCHANGE SHALL HAVE CUSTODY ONLY OF SECURITIES
OWNED BY THE TRUST AND SHALL NOT HOLD ANY OF ITS CASH. SPECIAL CUSTODIANS SHALL
BE APPOINTED PURSUANT TO A WRITTEN AGREEMENT APPROVED AND THEREAFTER AT LEAST
ANNUALLY RATIFIED BY THE TRUSTEES, AND ANY SUCH WRITTEN AGREEMENT SHALL MEET
SUCH REQUIREMENTS AS MAY BE SPECIFIED BY LAW OR BY THE REGULATIONS OF THE
COMMISSION. ANY SUCH WRITTEN AGREEMENT WITH A MEMBER FIRM OF A NATIONAL
SECURITIES EXCHANGE SHALL ALSO REQUIRE THAT THE SPECIAL CUSTODIAN SHALL DELIVER
TO THE CUSTODIAN ITS RECEIPT, EVIDENCING THAT IT HOLDS THE SPECIFIC SECURITIES
IN QUESTION ON BEHALF OF THE TRUST IN ITS SAFEKEEPING, BEFORE ANY PAYMENT CAN BE
MADE FOR SUCH SECURITIES BY THE TRUST. SPECIAL CUSTODIANS SHALL BE USED BY THE
TRUST ONLY FOR PURPOSES OF SAFEKEEPING DESIGNATED TYPES OF SECURITIES FOR
PERIODS OF LIMITED DURATION IN CASES WHERE, IN THE OPINION OF THE TRUSTEES,
OFFICERS OF THE TRUST, ITS INVESTMENT ADVISER OR OTHER AUTHORIZED AGENT, SUCH
SAFEKEEPING SERVICES WOULD BE MORE APPROPRIATE OR CONVENIENT TO THE _____ BAN
THE SAFEKEEPING OF SUCH SECURITIES WITH THE CUSTODIAN.
SECTION 4. SPECIAL DEPOSITORIES. THE TRUSTEES MAY BY RESOLUTION APPOINT AS
SPECIAL DEPOSITORIES ANY COMMERCIAL BANKS INSURED BY THE FEDERAL DEPOSIT
INSURANCE CORPORATION HAVING AGGREGATE CAPITAL, SURPLUS AND UNDIVIDED PROFITS
(AS SHOWN IN THEIR RESPECTIVE LAST PUBLISHED REPORTS) OF AT LEAST TWO MILLION
DOLLARS ($2,000,000). THE TRUST MAY MAINTAIN WITH A SPECIAL DEPOSITORY ONLY
DEMAND DEPOSIT ACCOUNTS AND SHALL NOT PERMIT THE AGGREGATE BALANCES IN SUCH
ACCOUNTS TO EXCEED THE AMOUNT OF ANY FIDELITY BOND COVERING ANY OFFICER OF THE
TRUST AUTHORIZED BY THE TRUSTEES TO HAVE SIGNATURE AUTHORITY OVER SUCH DEMAND
DEPOSIT ACCOUNTS.
ARTICLE X
DISTRIBUTIONS AND REDEMPTIONS
SECTION 1.DISTRIBUTIONS.
(A) THE TRUSTEES MAY FROM TIME TO TIME DECLARE AND PAY DIVIDENDS, AND THE AMOUNT
OF SUCH DIVIDENDS AND THE PAYMENT OF THEM SHALL BE WHOLLY IN THE DISCRETION OF
THE TRUSTEES.
(B) THE TRUSTEES MAY DECLARE ACCUMULATED NET INCOME OF THE TRUST (AS DEFINED
IN SECTION 3 OF THIS ARTICLE X) AS A DIVIDEND TO SHAREHOLDERS OF RECORD AT SUCH
TIME AS THE TRUSTEES SHALL DESIGNATE, PAYABLE IN ADDITIONAL FULL AND FRACTIONAL
SHARES OR IN CASH. THE TRUSTEES MAY, IF THEY DEEM IT ADVISABLE, DECLARE A
NEGATIVE DIVIDEND (OR REVERSE SPLIT) AND DEDUCT SUCH AMOUNT FROM THE PREVIOUSLY
ACCUMULATED DIVIDENDS OF EACH SHAREHOLDER OR FROM SUCH SHAREHOLDER'S INTEREST IN
THE TRUST.
(C) THE TRUSTEES MAY DISTRIBUTE IN RESPECT OF ANY FISCAL YEAR AS ORDINARY
DIVIDENDS AND AS CAPITAL GAINS DISTRIBUTIONS, RESPECTIVELY, AMOUNTS SUFFICIENT
TO ENABLE THE TRUST AS A REGULATED INVESTMENT COMPANY TO AVOID ANY LIABILITY FOR
FEDERAL INCOME TAXES IN RESPECT OF THAT YEAR.
(D) THE DECISION OF THE TRUSTEES AS TO WHAT, IN ACCORDANCE WITH GOOD
ACCOUNTING PRACTICE, IS INCOME AND WHAT IS PRINCIPAL SHALL. BE FINAL, AND EXCEPT
AS SPECIFICALLY PROVIDED HEREIN, THE DECISION OF THE TRUSTEES AS TO WHAT
EXPENSES AND CHARGES OF THE TRUST SHALL BE CHARGED AGAINST PRINCIPAL AND WHAT
AGAINST INCOME SHALL BE FINAL. ANY INCOME NOT DISTRIBUTED IN ANY YEAR MAY BE
PERMITTED TO ACCUMULATE AND AS LONG AS NOT DISTRIBUTED MAY BE INVESTED FROM TIME
TO TIME IN THE SAME MANNER AS THE PRINCIPAL FUNDS OF THE TRUST.
(E) THE TRUSTEES SHALL HAVE POWER, TO THE FULLEST EXTENT PERMITTED BY LAW,
AT ANY TIME, OR FROM TIME TO TIME, TO DECLARE AND CAUSE TO BE PAID DIVIDENDS,
WHICH AT THE ELECTION OF THE TRUSTEES, MAY BE ACCRUED, AUTOMATICALLY REINVESTED
IN ADDITIONAL SHARES (OR FRACTIONS THEREOF) OF THE TRUST OR PAID IN CASH OR
ADDITIONAL SHARES, ALL UPON SUCH TERMS AND CONDITIONS AS THE TRUSTEES MAY
PRESCRIBE.
(F) ANYTHING IN THIS INSTRUMENT TO THE CONTRARY NOTWITHSTANDING, THE
TRUSTEES MAY AT ANY TIME DECLARE AND DISTRIBUTE A DIVIDEND CONSISTING OF SHARES
OF THE TRUST.
SECTION 2. REDEMPTION AND REPURCHASES.
(A) IN CASE ANY SHAREHOLDER OF RECORD OF THE TRUST AT ANY TIME DESIRES OR
AUTHORIZES THE DISPOSITION OF SHARES RECORDED IN HIS NAME, HE OR HIS AUTHORIZED
AGENT MAY DEPOSIT A WRITTEN REQUEST (OR SUCH OTHER FORM OF REQUEST AS THE
TRUSTEES MAY FROM TIME TO TIME AUTHORIZE) REQUESTING THAT THE TRUST PURCHASE HIS
SHARES, TOGETHER WITH SUCH OTHER INSTRUMENTS OR AUTHORIZATION TO EFFECT THE
TRANSFER AS THE TRUSTEES MAY FROM TIME TO TIME REQUIRE, AT THE OFFICE OF THE
TRUST, AND THE TRUST SHALL PURCHASE HIS SAID SHARES, BUT ONLY AT THE NET ASSET
VALUE OF SUCH SHARES (AS DEFINED IN SECTION 4 OF THIS ARTICLE X) DETERMINED BY
OR ON BEHALF OF THE TRUSTEES NEXT AFTER SAID REQUEST.
PAYMENT FOR SUCH SHARES SHALL BE MADE BY THE TRUST TO THE SHAREHOLDER OF RECORD
AT A TIME DETERMINED BY THE TRUSTEES WITHIN SEVEN (7) DAYS AFTER THE DATE UPON
WHICH THE REQUEST (AND, IF REQUIRED, SUCH OTHER INSTRUMENTS OR AUTHORIZATIONS OF
TRANSFER) IS DEPOSITED, SUBJECT TO THE RIGHT OF THE TRUSTEES TO POSTPONE THE
DATE OF PAYMENT PURSUANT TO SECTION 5 OF THIS ARTICLE X. IF THE REDEMPTION IS
POSTPONED BEYOND THE DATE ON WHICH IT WOULD NORMALLY OCCUR BY REASON OF A
DECLARATION BY THE TRUSTEES SUSPENDING THE RIGHT OF REDEMPTION PURSUANT TO
SECTION 5 OF THIS ARTICLE X, THE RIGHT OF THE SHAREHOLDER TO HAVE HIS SHARES
PURCHASED BY THE TRUST SHALL BE SIMILARLY SUSPENDED, AND HE MAY WITHDRAW HIS
REQUEST (OR SUCH OTHER INSTRUMENTS OR AUTHORIZATIONS OF TRANSFER) FROM DEPOSIT
IF HE SO ELECTS; OR, IF HE DOES NOT SO ELECT, THE PURCHASE PRICE SHALL BE THE
NET ASSET VALUE OF HIS SHARES, DETERMINED NEXT AFTER TERMINATION OF SUCH
SUSPENSION AND PAYMENT THEREFOR SHALL BE MADE WITHIN SEVEN (7) DAYS THEREAFTER.
(B) THE TRUST MAY PURCHASE SHARES OF THE TRUST BY AGREEMENT WITH THE OWNER
THEREOF (1) AT A PRICE NOT EXCEEDING THE NET ASSET VALUE PER SHARE DETERMINED
NEXT AFTER THE PURCHASE OR CONTRACT OF PURCHASE IS MADE OR (2) AT A PRICE NOT
EXCEEDING THE NET ASSET VALUE PER SHARE DETERMINED AT SOME LATER TIME.
(C) SHARES PURCHASED BY THE TRUST EITHER PURSUANT TO PARAGRAPH (A) OR
PARAGRAPH (B) OF THIS SECTION 2 SHALL BE DEEMED TREASURY SHARES AND MAY BE
RESOLD BY THE TRUST.
(D) IF THE TRUSTEES DETERMINE THAT ECONOMIC CONDITIONS WOULD MAKE IT
SERIOUSLY DETRIMENTAL TO THE BEST INTERESTS OF THE REMAINING SHAREHOLDERS OF THE
TRUST TO MAKE PAYMENT WHOLLY OR PARTLY IN CASH, THE TRUST MAY PAY THE REDEMPTION
PRICE IN WHOLE OR IN PART BY A DISTRIBUTION IN KIND OF SECURITIES FROM THE
PORTFOLIO OF THE TRUST, IN LIEU OF CASH IN CONFORMITY WITH APPLICABLE RULES OF
THE COMMISSION, TAKING SUCH SECURITIES AT THE SAME VALUE EMPLOYED IN DETERMINING
NET ASSET VALUE AND SELECTING THE SECURITIES IN SUCH MANNER AS THE TRUSTEES MAY
DEEM FAIR AND EQUITABLE.
SECTION 3. DETERMINATION OF ACCUMULATED NET INCOME. THE ACCUMULATED NET INCOME
OF THE RUST SHALL BE DETERMINED BY OR ON BEHALF OF THE TRUSTEES DAILY OR MORE
FREQUENTLY AT THE DISCRETION OF THE TRUSTEES, ON EACH BUSINESS DAY AT SUCH TIME
OR TIMES AS THE TRUSTEES SHALL IN THEIR DISCRETION DETERMINE. SUCH DETERMINATION
SHALL BE MADE IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES AND
PRACTICES AND THE ACCOUNTING POLICIES ESTABLISHED BY THE TRUSTEES, AND MAY
INCLUDE REALIZED AND/OR UNREALIZED GAINS FROM THE SALE OR DISPOSITION OF
SECURITIES OR OTHER PROPERTY OF THE TRUST. THE POWER AND DUTY TO DETERMINE
ACCUMULATED NET INCOME MAY BE DELEGATED BY THE TRUSTEES FROM TIME TO TIME TO ONE
OR MORE OF THE TRUSTEES OR OFFICERS OF THE TRUST, TO THE OTHER PARTY TO ANY
CONTRACT ENTERED INTO PURSUANT TO SECTION 1 OR 2 OF ARTICLE VII, OR TO THE
CUSTODIAN OR TO A TRANSFER AGENT.
SECTION 4. NET ASSET VALUE OF SHARES. THE NET ASSET VALUE OF EACH SHARE OF THE
TRUST OUTSTANDING SHALL BE DETERMINED AT LEAST ONCE ON EACH BUSINESS DAY BY OR
ON BEHALF OF THE TRUSTEES. THE POWER AND DUTY TO DETERMINE NET ASSET VALUE MAY
BE DELEGATED BY THE TRUSTEES FROM TIME TO TIME TO ONE OR MORE OF THE TRUSTEES OR
OFFICERS OF THE TRUST, TO THE OTHER PARTY TO ANY CONTRACT ENTERED INTO PURSUANT
TO SECTION 1 OR 2 OF ARTICLE VII, OR TO THE CUSTODIAN OR TO A TRANSFER AGENT.
THE NET ASSET VALUE OF EACH SHARE OF THE TRUST AS OF ANY PARTICULAR TIME SHALL
BE THE QUOTIENT (ADJUSTED TO THE NUMBER OF SIGNIFICANT DIGITS DETERMINED BY THE
TRUSTEES) OBTAINED BY DIVIDING THE VALUE, AS OF SUCH TIME, OF THE NET ASSETS OF
THE TRUST (I.E., THE VALUE OF THE ASSETS OF THE TRUST LESS ITS LIABILITIES
EXCLUSIVE OF CAPITAL AND SURPLUS) BY THE TOTAL NUMBER OF SHARES OUTSTANDING
(EXCLUSIVE OF TREASURY SHARES) AT SUCH TIME IN ACCORDANCE WITH THE REQUIREMENTS
OF THE 1940 ACT AND ANY APPLICABLE RULES, REGULATIONS AND ORDERS THEREUNDER, AND
APPLICABLE PROVISIONS OF THE BY-LAWS OF THE TRUST IN CONFORMITY WITH GENERALLY
ACCEPTED ACCOUNTING PRACTICES AND PRINCIPLES.
SECTION 5. SUSPENSION OF THE RIGHT OF REDEMPTION. THE TRUSTEES MAY DECLARE A
SUSPENSION OF THE DETERMINATION OF NET ASSET VALUE AND/OR THE RIGHT OF
REDEMPTION OR POSTPONE THE DATE OF PAYMENT OR THE WHOLE OR ANY PART OF ANY
PERIOD (I) DURING WHICH THE NEW YORK STOCK EXCHANGE IS CLOSED OTHER THAN
CUSTOMARY WEEKEND AND HOLIDAY CLOSINGS, (II) DURING WHICH TRADING ON THE NEW
YORK STOCK EXCHANGE IS RESTRICTED, (III) DURING WHICH AN EMERGENCY EXISTS AS A
RESULT OF WHICH DISPOSAL BY THE TRUST OF SECURITIES OWNED BY IT IS NOT
REASONABLY PRACTICABLE OR IT IS NOT REASONABLY PRACTICABLE FOR THE TRUST FAIRLY
TO DETERMINE THE VALUE OF ITS NET ASSETS, OR (IV) DURING ANY OTHER PERIOD WHEN
THE COMMISSION MAY FOR THE PROTECTION OF SECURITY HOLDERS OF THE TRUST BY ORDER,
RULE OR INTERPRETATION PERMIT SUSPENSION OF THE RIGHT OF REDEMPTION OR
POSTPONEMENT OF THE DATE OF PAYMENT ON REDEMPTION; PROVIDED THAT APPLICABLE
RULES, INTERPRETATIONS AND REGULATIONS OF THE COMMISSION SHALL GOVERN AS TO
WHETHER THE CONDITIONS PRESCRIBED IN (II) OR (III) EXIST. SUCH SUSPENSION SHALL
TAKE EFFECT AT SUCH TIME AS THE TRUSTEES SHALL SPECIFY BUT NOT LATER THAN THE
CLOSE OF BUSINESS ON THE BUSINESS DAY NEXT FOLLOWING THE DECLARATION OF
SUSPENSION, AND THEREAFTER THERE SHALL BE NO RIGHT OF REDEMPTION OR PAYMENT
UNTIL THE TRUSTEES SHALL DECLARE THE SUSPENSION AT AN END, EXCEPT THAT THE
SUSPENSION SHALL TERMINATE IN ANY EVENT ON THE FIRST DAY ON WHICH SAID STOCK
EXCHANGE SHALL HAVE REOPENED OR THE PERIOD SPECIFIED IN (II) OR (III) SHALL HAVE
EXPIRED (AS TO WHICH IN THE ABSENCE OF AN OFFICIAL RULING BY THE COMMISSION, THE
DETERMINATION OF THE TRUSTEES SHALL BE CONCLUSIVE).
SECTION 6. TRUST'S RIGHT TO REDEEM SHARES. THE TRUST SHALL HAVE THE RIGHT TO
CAUSE THE REDEMPTION OF SHARES IN ANY SHAREHOLDER'S ACCOUNT FOR THEIR THEN
CURRENT NET ASSET VALUE (WHICH WILL BE PROMPTLY PAID TO THE SHAREHOLDER IN
CASH) IF AT ANY TIME THE TOTAL INVESTMENT IN THE ACCOUNT DOES NOT HAVE A MINIMUM
DOLLAR VALUE DETERMINED FROM TIME TO TIME BY THE TRUSTEES IN THEIR SOLE
DISCRETION. SHARES OF THE TRUST ARE REDEEMABLE AT THE OPTION OF THE TRUST IF, IN
THE OPINION OF THE TRUSTEES, OWNERSHIP OF TRUST SHARES HAS OR MAY BECOME
CONCENTRATED TO AN EXTENT WHICH WOULD CAUSE THE TRUST TO BE A PERSONAL HOLDING
COMPANY WITHIN THE MEANING OF THE INTERNAL REVENUE CODE OF 1954, AS AMENDED, AND
ANY SUCCESSOR STATUTE (AND THEREBY DISQUALIFIED UNDER SUB-CHAPTER M OF SAID
CODE); IN SUCH CIRCUMSTANCES THE TRUST MAY COMPEL THE REDEMPTION OF SHARES,
REJECT ANY ORDER FOR THE PURCHASE OF SHARES OR REFUSE TO GIVE EFFECT TO THE
TRANSFER OF SHARES.
ARTICLE XI
LIMITATION OF LIABILITY AND INDEMNIFICATION
SECTION 1. LIMITATION OF PERSONAL LIABILITY AND INDEMNIFICATION OF
SHAREHOLDERS. THE TRUSTEES, OFFICERS, EMPLOYEES OR AGENTS OF THE TRUST SHALL
HAVE NO POWER TO BIND ANY SHAREHOLDER PERSONALLY OR TO CALL UPON ANY SHAREHOLDER
FOR THE PAYMENT OF ANY SUM OF MONEY OR ASSESSMENT WHATSOEVER, OTHER THAN SUCH AS
THE SHAREHOLDER MAY AT ANY TIME AGREE TO PAY BY WAY OF SUBSCRIPTION TO ANY
SHARES OR OTHERWISE.
NO SHAREHOLDER OR FORMER SHAREHOLDER OF THE TRUST SHALL BE LIABLE SOLELY BY
REASON OF HIS BEING OR HAVING BEEN A SHAREHOLDER FOR ANY DEBT, CLAIM, ACTION,
DEMAND, SUIT, PROCEEDING, JUDGMENT, DECREE, LIABILITY OR OBLIGATION OF ANY KIND,
AGAINST, OR WITH RESPECT TO THE TRUST ARISING OUT OF ANY ACTION TAKEN OR OMITTED
FOR OR ON BEHALF OF THE TRUST, AND THE TRUST SHALL BE SOLELY LIABLE THEREFOR AND
RESORT SHALL BE HAD SOLELY TO THE TRUST PROPERTY FOR THE PAYMENT OR PERFORMANCE
THEREOF.
EACH SHAREHOLDER OR FORMER SHAREHOLDER OF THE TRUST (OR THEIR HEIRS, EXECUTORS,
ADMINISTRATORS OR OTHER LEGAL REPRESENTATIVES OR, IN CASE OF A CORPORATE ENTITY,
ITS CORPORATE OR GENERAL SUCCESSOR) SHALL BE ENTITLED TO INDEMNITY AND
REIMBURSEMENT OUT OF THE TRUST PROPERTY TO THE FULL EXTENT OF SUCH LIABILITY AND
THE COSTS OF ANY LITIGATION OR OTHER PROCEEDINGS IN WHICH SUCH LIABILITY SHALL
HAVE BEEN DETERMINED, INCLUDING, WITHOUT LIMITATION, THE FEES AND DISBURSEMENTS
OF COUNSEL IF, CONTRARY TO THE PROVISIONS HEREOF, SUCH SHAREHOLDER OR FORMER
SHAREHOLDER OF THE TRUST SHALL BE HELD TO PERSONAL LIABILITY.
THE TRUST SHALL, UPON REQUEST BY THE SHAREHOLDER OR FORMER SHAREHOLDER, ASSUME
THE DEFENSE OF ANY CLAIM MADE AGAINST ANY SHAREHOLDER FOR ANY ACT OR OBLIGATION
OF THE TRUST AND SATISFY ANY JUDGMENT THEREON.
SECTION 2. LIMITATION OF PERSONAL LIABILITY OF TRUSTEES, OFFICERS,
EMPLOYEES OR AGENTS OF THE TRUST. NO
TRUSTEE, OFFICER, EMPLOYEE OR AGENT OF THE TRUST SHALL HAVE THE POWER TO BIND
ANY OTHER TRUSTEE, OFFICER, EMPLOYEE OR AGENT OF THE TRUST PERSONALLY. THE
TRUSTEES, OFFICERS, EMPLOYEES OR AGENTS OF THE TRUST INCURRING ANY DEBTS,
LIABILITIES OR OBLIGATIONS, OR IN TAKING OR OMITTING ANY OTHER ACTIONS FOR OR IN
CONNECTION WITH THE TRUST ARE, AND EACH SHALL BE DEEMED TO BE, ACTING AS
TRUSTEE, OFFICER, EMPLOYEE OR AGENT OF THE TRUST AND NOT IN HIS OWN INDIVIDUAL
CAPACITY.
PROVIDED THEY HAVE ACTED UNDER THE BELIEF THAT THEIR ACTIONS ARE IN THE BEST
INTEREST OF THE TRUST, THE TRUSTEES AND OFFICERS SHALL NOT BE RESPONSIBLE FOR OR
LIABLE IN ANY EVENT FOR NEGLECT OR WRONGDOING BY THEM OR ANY OFFICER, AGENT,
EMPLOYEE, INVESTMENT ADVISER, PRINCIPAL UNDERWRITER, TRANSFER AGENT OR CUSTODIAN
OF THE TRUST OR OF ANY ENTITY PROVIDING ADMINISTRATIVE SERVICES FOR THE TRUST,
BUT NOTHING HEREIN CONTAINED SHALL PROTECT ANY TRUSTEE OR OFFICER AGAINST ANY
LIABILITY TO WHICH HE WOULD OTHERWISE BE SUBJECT BY REASON OF WILLFUL
MISFEASANCE, BAD FAITH, GROSS NEGLIGENCE OR RECKLESS DISREGARD OF THE DUTIES
INVOLVED IN THE CONDUCT OF HIS OFFICE.
SECTION 3. EXPRESS EXCULPATORY CLAUSES AND INSTRUMENTS. THE TRUSTEES SHALL USE
APPROPRIATE MEANS TO ASSURE THAT ALL PERSONS HAVING DEALINGS WITH THE TRUST
SHALL BE INFORMED THAT THE PROPERTY OF THE SHAREHOLDERS AND THE TRUSTEES,
OFFICERS, EMPLOYEES AND AGENTS OF THE TRUST SHALL NOT BE SUBJECT TO CLAIMS
AGAINST OR OBLIGATIONS OF THE TRUST TO ANY EXTENT WHATSOEVER. THE TRUSTEES MAY
CAUSE TO BE INSERTED IN ANY WRITTEN AGREEMENT, UNDERTAKING OR OBLIGATION MADE OR
ISSUED ON BEHALF OF THE TRUST (INCLUDING CERTIFICATES FOR SHARES OF THE TRUST)
AN APPROPRIATE REFERENCE TO THIS DECLARATION, PROVIDING THAT NEITHER THE
SHAREHOLDERS, THE TRUSTEES, THE OFFICERS, THE EMPLOYEES NOR ANY AGENT OF THE
TRUST SHALL BE LIABLE THEREUNDER, AND THAT THE OTHER PARTIES TO SUCH INSTRUMENT
SHALL LOOK SOLELY TO THE TRUST PROPERTY FOR THE PAYMENT OF ANY CLAIM THEREUNDER
OR FOR THE PERFORMANCE THEREOF; BUT THE OMISSION OF SUCH PROVISIONS FROM ANY
SUCH INSTRUMENT SHALL NOT RENDER ANY SHAREHOLDER, TRUSTEE, OFFICER, EMPLOYEE OR
AGENT LIABLE, NOR SHALL THE TRUSTEE, OR ANY OFFICER, AGENT OR EMPLOYEE OF THE
TRUST BE LIABLE TO ANYONE FOR SUCH OMISSION. IF, NOTWITHSTANDING THIS PROVISION,
ANY SHAREHOLDER, TRUSTEE, OFFICER, EMPLOYEE OR AGENT SHALL BE HELD LIABLE TO ANY
OTHER PERSON BY REASON OF THE OMISSION OF SUCH PROVISION FROM ANY SUCH
AGREEMENT, UNDERTAKING OR OBLIGATION, THE SHAREHOLDER, TRUSTEE, OFFICER,
EMPLOYEE OR AGENT SHALL BE ENTITLED TO INDEMNITY AND REIMBURSEMENT OUT OF THE
TRUST PROPERTY, AS PROVIDED IN THIS ARTICLE XI.
SECTION 4. MANDATORY INDEMNIFICATION.
(A) SUBJECT ONLY TO THE PROVISIONS HEREOF, EVERY PERSON WHO IS OR HAS BEEN A
TRUSTEE, OFFICER, EMPLOYEE OR AGENT OF THE TRUST AND EVERY PERSON WHO SERVES AT
THE TRUST'S REQUEST AS DIRECTOR, OFFICER, EMPLOYEE OR AGENT OF ANOTHER
CORPORATION, PARTNERSHIP, JOINT VENTURE, TRUST OR OTHER ENTERPRISE SHALL BE
INDEMNIFIED BY THE TRUST TO THE FULLEST EXTENT PERMITTED BY LAW AGAINST ALL
LIABILITIES AND AGAINST ALL EXPENSES REASONABLY INCURRED OR PAID BY HIM IN
CONNECTION WITH ANY DEBT, CLAIM, ACTION, DEMAND, SUIT, PROCEEDING, JUDGMENT,
DECREE, LIABILITY OR OBLIGATION OF ANY KIND IN WHICH HE BECOMES INVOLVED AS A
PARTY OR OTHERWISE OR IS THREATENED BY VIRTUE OF HIS BEING OR HAVING TEEN A
TRUSTEE, OFFICER, EMPLOYEE OR AGENT OF THE TRUST OR OF ANOTHER CORPORATION,
PARTNERSHIP, JOINT VENTURE, TRUST OR OTHER ENTERPRISE AT THE REQUEST OF THE
TRUST AGAINST AMOUNTS PAID OR INCURRED BY HIM IN THE COMPROMISE OR SETTLEMENT
THEREOF.
(B) THE WORDS "CLAIM," "ACTION," "SUIT," OR "PROCEEDING" SHALL APPLY TO
ALL CLAIMS, ACTIONS, SUITS OR
PROCEEDINGS (CIVIL, CRIMINAL, ADMINISTRATIVE, LEGISLATIVE, INVESTIGATIVE OR
OTHER, INCLUDING APPEALS), ACTUAL OR THREATENED, AND THE WORDS "LIABILITIES" AND
"EXPENSES" SHALL INCLUDE, WITHOUT LIMITATION, ATTORNEYS' FEES, COSTS, JUDGMENTS,
AMOUNTS PAID IN SETTLEMENT, FINES, PENALTIES AND OTHER LIABILITIES.
(C) NO INDEMNIFICATION SHALL BE PROVIDED TO ANY PERSON HEREUNDER AGAINST ANY
LIABILITIES TO THE TRUST OR ITS SHAREHOLDERS ADJUDICATED TO HAVE BEEN INCURRED
BY REASON OF WILLFUL MISFEASANCE, BAD FAITH, GROSS NEGLIGENCE, OR RECKLESS
DISREGARD OF THE DUTIES INVOLVED IN THE CONDUCT OF SUCH PERSON'S OFFICE.
(D) THE RIGHTS OF INDEMNIFICATION HEREIN PROVIDED MAY BE INSURED AGAINST BY
POLICIES MAINTAINED BY THE TRUST, SHALL BE SEVERABLE, SHALL NOT AFFECT ANY OTHER
RIGHTS TO WHICH ANY TRUSTEE, OFFICER, EMPLOYEE OR AGENT MAY NOW OR HEREAFTER BE
ENTITLED, SHALL CONTINUE AS TO A PERSON WHO HAS CEASED TO BE SUCH TRUSTEE,
OFFICER, EMPLOYEE, OR AGENT AND SHALL INURE TO THE BENEFIT OF THE HEIRS,
EXECUTORS AND ADMINISTRATORS OF SUCH A PERSON; PROVIDED, HOWEVER, THAT NO PERSON
MAY SATISFY ANY RIGHT OF INDEMNITY OR REIMBURSEMENT GRANTED HEREIN EXCEPT OUT OF
THE PROPERTY OF THE TRUST, AND NO OTHER PERSON SHALL BE PERSONALLY LIABLE TO
PROVIDE INDEMNITY OR REIMBURSEMENT HEREUNDER (EXCEPT AN INSURER OR SURETY OF
PERSON OTHERWISE BOUND BY CONTRACT).
(E) 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 4 MAY BE PAID BY THE TRUST PRIOR TO FINAL
DISPOSITION THEREOF UPON RECEIPT OF A WRITTEN UNDERTAKING BY OR ON BEHALF OF THE
TRUSTEE, OFFICER, EMPLOYEE OR AGENT TO REIMBURSE TO THE TRUST IF IT IS
ULTIMATELY DETERMINED UNDER THIS SECTION 4 THAT HE IS NOT ENTITLED TO
INDEMNIFICATION.
ARTICLE XII
MISCELLANEOUS
SECTION 1. TRUST IS NOT A PARTNERSHIP. IT IS HEREBY EXPRESSLY DECLARED THAT
A TRUST AND NOT A PARTNERSHIP IS
CREATED HEREBY.
SECTION 2. TRUSTEE'S GOOD FAITH ACTION, EXPERT ADVICE, NO BOND OR SURETY. THE
EXERCISE BY THE TRUSTEES OF THEIR POWERS AND DISCRETIONS HEREUNDER IN GOOD FAITH
AND WITH REASONABLE CARE UNDER THE CIRCUMSTANCES THEN PREVAILING, SHALL BE
BINDING UPON EVERYONE INTERESTED. SUBJECT TO THE PROVISIONS OF ARTICLE XI, THE
TRUSTEES SHALL NOT BE LIABLE FOR ERRORS OF JUDGMENT OR MISTAKES OF FACT OR LAW.
THE TRUSTEES MAY TAKE ADVICE OF COUNSEL OR OTHER EXPERTS WITH RESPECT TO THE
MEANING AND OPERATION OF THIS DECLARATION OF TRUST, AND SUBJECT TO THE
PROVISIONS OF ARTICLE XI, SHALL BE UNDER NO LIABILITY FOR ANY ACT OR OMISSION IN
ACCORDANCE WITH SUCH ADVICE OR FOR FAILING TO FOLLOW SUCH ADVICE. THE TRUSTEES
SHALL NOT BE REQUIRED TO GIVE ANY BOND AS SUCH, NOR ANY SURETY IF A BOND IS
REQUIRED.
SECTION 3. ESTABLISHMENT OF RECORD DATES. THE TRUSTEES MAY CLOSE THE SHARE
TRANSFER BOOKS OF THE TRUST FOR A PERIOD NOT EXCEEDING NINETY (90) DAYS
PRECEDING THE DATE OF ANY MEETING OF SHAREHOLDERS, OR THE DATE FOR THE PAYMENT
OF ANY DIVIDEND OR THE MAKING OF ANY DISTRIBUTION TO SHAREHOLDERS, OR THE DATE
FOR THE ALLOTMENT OF RIGHTS, OR THE DATE WHEN ANY CHANGE OR CONVERSION OR
EXCHANGE OF SHARES SHALL GO INTO; OR IN LIEU OF CLOSING THE SHARE TRANSFER BOOKS
AS AFORESAID, THE TRUSTEES MAY FIX IN ADVANCE A DATE, NOT EXCEEDING NINETY (90)
DAYS PRECEDING THE DATE OF ANY MEETING OF SHAREHOLDERS, OR THE DATE FOR THE
PAYMENT OF ANY DIVIDEND OR THE MAKING OF ANY DISTRIBUTION TO SHAREHOLDERS, OR
THE DATE FOR THE ALLOTMENT OF RIGHTS, OR THE DATE WHEN ANY CHANGE OR CONVERSION
OR EXCHANGE OF SHARES SHALL GO INTO EFFECT, OR THE LAST DAY ON WHICH THE CONSENT
OR DISSENT OF SHAREHOLDERS MAY BE EFFECTIVELY EXPRESSED FOR ANY PURPOSE, AS A
RECORD DATE FOR THE DETERMINATION OF THE SHAREHOLDERS ENTITLED TO NOTICE OF,
AND, TO VOTE AT, ANY SUCH MEETING AND ANY ADJOURNMENT THEREOF, OR ENTITLED TO
RECEIVE PAYMENT OF ANY SUCH DIVIDEND OR DISTRIBUTION, OR TO ANY SUCH ALLOTMENT
OF RIGHTS, OR TO EXERCISE THE RIGHTS IN RESPECT OF ANY SUCH CHANGE, CONVERSION
OR EXCHANGE OF SHARES, OR TO EXERCISE THE RIGHT TO GIVE SUCH CONSENT OR DISSENT,
AND IN SUCH CASE, SUCH SHAREHOLDERS AND ONLY SUCH SHAREHOLDERS AS SHALL BE
SHAREHOLDERS OF RECORD ON THE DATE SO FIXED SHALL BE ENTITLED TO SUCH NOTICE OF,
AND TO VOTE AT, SUCH MEETING OR TO RECEIVE PAYMENT OF SUCH DIVIDEND OR
DISTRIBUTION, OR TO RECEIVE SUCH ALLOTMENT OR RIGHTS, OR TO EXERCISE SUCH
RIGHTS, AS THE CASE MAY BE, NOTWITHSTANDING ANY TRANSFER OF ANY SHARES ON THE
BOOKS OF THE TRUST AFTER ANY SUCH DATE FIXED AS AFORESAID.
SECTION 4. TERMINATION OF TRUST.
(A) THIS TRUST SHALL CONTINUE WITHOUT LIMITATION OF TIME BUT SUBJECT TO THE
PROVISIONS OF PARAGRAPHS (B), (C) AND (D) OF THIS SECTION 4.
(B) THE TRUSTEES, WITH THE APPROVAL OF THE HOLDERS OF A MAJORITY OF THE
OUTSTANDING SHARES, MAY MERGE, CONSOLIDATE, OR SELL AND CONVEY THE ASSETS OF THE
TRUST INCLUDING ITS GOODWILL TO ANOTHER TRUST OR CORPORATION ORGANIZED UNDER THE
LAWS OF ANY STATE OF THE UNITED STATES FOR AN ADEQUATE CONSIDERATION WHICH MAY
INCLUDE THE ASSUMPTION OF ALL OUTSTANDING OBLIGATIONS, TAXES, AND OTHER
LIABILITIES, ACCRUED OR CONTINGENT, OF THE TRUST AND WHICH MAY INCLUDE SHARES OF
BENEFICIAL INTEREST OR STOCK OF SUCH TRUST OR CORPORATION. UPON MAKING PROVISION
FOR THE PAYMENT OF ALL SUCH LIABILITIES, BY SUCH ASSUMPTION OR OTHERWISE, THE
TRUSTEES SHALL DISTRIBUTE THE NET PROCEEDS OF THE TRANSACTION RATABLY AMONG THE
HOLDERS OF THE SHARES OF THE TRUST THEN OUTSTANDING.
(C) SUBJECT TO A MAJORITY SHAREHOLDER VOTE, THE TRUSTEES MAY AT ANY TIME
SELL AND CONVERT INTO MONEY ALL THE ASSETS OF THE TRUST. UPON MAKING PROVISION
FOR THE PAYMENT OF ALL OUTSTANDING OBLIGATIONS, TAXES AND OTHER LIABILITIES,
ACCRUED OR CONTINGENT, OF THE TRUST, THE TRUSTEES SHALL DISTRIBUTE THE REMAINING
ASSETS OF THE TRUST RATABLY AMONG THE HOLDERS OF THE OUTSTANDING SHARES.
(D) UPON COMPLETION OF THE DISTRIBUTION OF THE REMAINING PROCEEDS OR THE
REMAINING ASSETS AS PROVIDED IN PARAGRAPHS (B) AND (C), THE TRUST SHALL BE
DISCHARGED OF ANY AND ALL FURTHER LIABILITIES AND DUTIES HEREUNDER AND THE
RIGHT, TITLE, AND INTEREST OF ALL PARTIES SHALL BE CANCELED AND DISCHARGED.
SECTION 5. OFFICES OF THE TRUST, FILING OF COPIES, REFERENCES, HEADINGS. THE
TRUST MAY MAINTAIN SUCH OFFICES IN SUCH LOCATIONS AS THE TRUSTEES MAY FROM TIME
TO TIME DETERMINE. THE ORIGINAL OR A COPY OF THIS INSTRUMENT AND OF EACH
DECLARATION OF TRUST SUPPLEMENTAL HERETO SHALL BE KEPT AT THE OFFICE OF THE
TRUST WHERE IT MAY BE INSPECTED BY ANY SHAREHOLDER. A COPY OF THIS INSTRUMENT
AND OF EACH SUPPLEMENTAL DECLARATION OF TRUST SHALL BE FILED BY THE TRUSTEES
WITH THE MASSACHUSETTS SECRETARY OF STATE, AS WELL AS ANY OTHER GOVERNMENTAL
OFFICE WHERE SUCH FILING MAY FROM TIME TO TIME BE REQUIRED. ANYONE DEALING WITH
THE TRUST MAY RELY ON A CERTIFICATE BY AN OFFICER OF THE TRUST AS TO WHETHER OR
NOT ANY SUCH SUPPLEMENTAL DECLARATION OF TRUST HAS BEEN MADE AND AS TO ANY
MATTERS IN CONNECTION WITH THE TRUST HEREUNDER, AND WITH THE SAME EFFECT AS IF
IT WERE THE ORIGINAL, MAY RELY ON A COPY CERTIFIED BY AN OFFICER OF THE TRUST TO
BE A COPY OF THIS INSTRUMENT OR OF ANY SUCH SUPPLEMENTAL DECLARATION OF TRUST.
IN THIS INSTRUMENT OR IN ANY SUCH SUPPLEMENTAL DECLARATION OF TRUST, REFERENCES
TO THIS INSTRUMENT, AND ALL EXPRESSIONS LIKE "HEREIN," "HEREOF" AND "HEREUNDER,"
SHALL BE DEEMED TO REFER TO THIS INSTRUMENT AS AMENDED OR AFFECTED BY ANY SUCH
SUPPLEMENTAL DECLARATION OF TRUST. HEADINGS ARE PLACED HEREIN FOR CONVENIENCE OR
REFERENCE ONLY, AND IN CASE OF ANY CONFLICT, THE TEXT OF THIS INSTRUMENT, RATHER
THAN THE HEADINGS, SHALL CONTROL. THIS INSTRUMENT MAY HE EXECUTED IN ANY NUMBER
OF COUNTERPARTS EACH OF WHICH SHALL BE DEEMED AN ORIGINAL.
SECTION 6. APPLICABLE LAW. THE TRUST SET FORTH IN THIS INSTRUMENT IS
CREATED UNDER AND IS TO BE GOVERNED BY AND CONSTRUED AND ADMINISTERED ACCORDING
TO THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS. THE TRUST SHALL BE OF THE TYPE
COMMONLY CALLED A MASSACHUSETTS BUSINESS TRUST, AND WITHOUT LIMITING THE
PROVISIONS HEREOF, THE TRUST MAY EXERCISE ALL POWERS WHICH ARE ORDINARILY
EXERCISED BY SUCH A TRUST.
SECTION 7. AMENDMENTS. PRIOR TO THE INITIAL ISSUANCE OF SHARES PURSUANT TO THE
SECOND SENTENCE OF SECTION 3 OF ARTICLE III, A MAJORITY OF THE TRUSTEES THEN IN
OFFICE MAY AMEND OR OTHERWISE SUPPLEMENT THIS INSTRUMENT BY MAKING A DECLARATION
OF TRUST SUPPLEMENTAL HERETO, WHICH THEREAFTER SHALL FORM A PART HEREOF.
SUBSEQUENT TO SUCH INITIAL ISSUANCE OF SHARES, IF AUTHORIZED BY A MAJORITY OF
THE TRUSTEES THEN IN OFFICE AND BY A MAJORITY SHAREHOLDER VOTE, OR BY ANY LARGER
VOTE WHICH MAY HE REQUIRED BY APPLICABLE LAW OR THIS DECLARATION OF TRUST IN ANY
PARTICULAR CASE, THE TRUSTEES SHALL AMEND OR OTHERWISE SUPPLEMENT THIS
INSTRUMENT, BY MAKING A DECLARATION OF TRUST SUPPLEMENTAL HERETO, WHICH
THEREAFTER SHALL FORM A PART HEREOF. ANY SUCH SUPPLEMENTAL DECLARATION OF TRUST
SHALL BE SIGNED BY AT LEAST A MAJORITY OF THE TRUSTEES THEN IN OFFICE. COPIES OF
THE SUPPLEMENTAL DECLARATION OF TRUST SHALL BE FILED AS SPECIFIED IN SECTION 5
OF THIS ARTICLE XII.
SECTION 8. CONFLICTS WITH LAW OR REGULATIONS.
(A) THE PROVISIONS OF THIS DECLARATION OF TRUST ARE SEVERABLE, AND IF THE
TRUSTEES DETERMINE, WITH THE ADVICE OF COUNSEL, THAT ANY SUCH PROVISION IS IN
UNRESOLVABLE CONFLICT WITH THE 1940 ACT, WITH THE PROVISIONS OF THE INTERNAL
REVENUE CODE RELATING TO THE TAX TREATMENT OF A REGULATED INVESTMENT COMPANY OR
OTHER MATTERS CONCERNING REGULATED INVESTMENT COMPANIES, OR WITH OTHER
APPLICABLE LAWS OR REGULATIONS, THE CONFLICTING PROVISION SHALL BE DEEMED NEVER
TO HAVE CONSTITUTED A PART OF THIS DECLARATION OF TRUST; PROVIDED, HOWEVER, THAT
SUCH DETERMINATION SHALL NOT AFFECT ANY OF THE REMAINING PROVISIONS HEREOF NOR
RENDER INVALID OR IMPROPER ANY ACTION TAKEN OR OMITTED PRIOR TO SUCH
DETERMINATION.
(B) IF ANY PROVISION OF THIS DECLARATION OF TRUST SHALL BE HELD INVALID OR
UNENFORCEABLE IN ANY JURISDICTION, SUCH INVALIDITY OR UNENFORCEABILITY SHALL NOT
ATTACH TO SUCH PROVISION IN ANY OTHER JURISDICTION OR ANY OTHER PROVISION HEREOF
IN ANY JURISDICTION.
SECTION 9. USE OF NAME. THE TRUSTEES OF THE TRUST ACKNOWLEDGE THAT, IN
CONSIDERATION OF ITS ASSUMPTION OF CERTAIN EXPENSES OF FORMATION OF THE TRUST,
CALVERT ASSET MANAGEMENT COMPANY, INC., HAS RESERVED FOR ITSELF THE RIGHTS TO
THE NAME "CALVERT CASH RESERVES" (OR ANY SIMILAR NAME) AND THAT USE BY THE TRUST
OF SUCH NAME SHALL CONTINUE ONLY WITH THE CONTINUING CONSENT OF CALVERT ASSET
MANAGEMENT COMPANY, INC., WHICH CONSENT MAY BE WITHDRAWN AT ANY TIME, EFFECT
IMMEDIATELY, UPON WRITTEN NOTICE THEREOF TO THE TRUST.
IN WITNESS WHEREOF, THE UNDERSIGNED HAVE EXECUTED THIS INSTRUMENT ON THE DATE
FIRST WRITTEN ABOVE.
JOHN G. GUFFEY, JR.
D. WAYNE SILBY
BY-LAWS
OF
CALVERT CASH RESERVES
ARTICLE I
SHAREHOLDERS
SECTION 1. MEETINGS. MEETINGS OF THE SHAREHOLDERS SHALL BE HELD AT THE PRINCIPAL
OFFICES OF THE TRUST IN WASHINGTON, D.C. OR AT SUCH PLACE WITHIN OR WITHOUT THE
COMMONWEALTH OF MASSACHUSETTS AND ON SUCH DATES AND AT SUCH TIMES AS THE
TRUSTEES SHALL DESIGNATE.
SECTION 2. NOTICE OF MEETINGS. NOTICE OF ALL MEETINGS OF THE SHAREHOLDERS,
STATING THE TIME, PLACE, AND PURPOSES OF THE MEETING, SHALL BE GIVEN BY THE
TRUSTEES BY MAIL TO EACH SHAREHOLDER AT HIS ADDRESS AS RECORDED WITH THE TRUST
AT LEAST TEN (10) DAYS AND NOT MORE THAN NINETY (90) DAYS BEFORE THE MEETING.
ANY ADJOURNED MEETING MAY BE HELD AS ADJOURNED WITHOUT FURTHER NOTICE. NO NOTICE
NEED BE GIVEN TO ANY SHAREHOLDER WHO SHALL HAVE FAILED TO INFORM THE TRUST OF
HIS CURRENT ADDRESS OR IF A WRITTEN WAIVER OF NOTICE, EXECUTED BEFORE OR AFTER
THE MEETING BY THE SHAREHOLDER OR HIS ATTORNEY THEREUNTO AUTHORIZED, IS FILED
WITH THE RECORDS OF THE MEETING.
SECTION 3. RECORD DATE FOR MEETINGS AND OTHER PURPOSES. FOR THE PURPOSE OF
DETERMINING THE SHAREHOLDERS WHO ARE ENTITLED TO NOTICE OF AND TO VOTE AT ANY
MEETING, INCLUDING ANY ADJOURNMENT THEREOF, OR WHO ARE ENTITLED TO PARTICIPATE
IN ANY DISTRIBUTION, OR FOR THE PURPOSE OF ANY OTHER ACTION, THE TRUSTEES MAY
FROM TIME TO TIME CLOSE THE TRANSFER BOOKS FOR SUCH PERIOD, NOT EXCEEDING NINETY
(90) DAYS, AS THE TRUSTEES MAY DETERMINE; OR WITHOUT CLOSING THE TRANSFER BOOKS,
THE TRUSTEES MAY FIX A DATE NOT MORE THAN NINETY (90) DAYS PRIOR TO THE DATE OF
ANY MEETING OF SHAREHOLDERS OR DISTRIBUTION OR OTHER ACTION AS A RECORD DATE FOR
THE DETERMINATION OF THE PERSONS TO BE TREATED AS SHAREHOLDERS GOVERNED BY THE
DECLARATION OF TRUST.
SECTION 4. PROXIES. AT ANY MEETING OF SHAREHOLDERS, ANY HOLDER OF SHARES
ENTITLED TO VOTE THEREAT MAY VOTE EITHER IN PERSON OR BY PROXY, PROVIDED THAT NO
PROXY SHALL BE VOTED AT ANY MEETING UNLESS IT SHALL HAVE BEEN PLACED ON FILE
WITH THE SECRETARY, OR WITH SUCH OTHER OFFICER OR AGENT OF THE TRUST AS THE
SECRETARY MAY DIRECT, FOR VERIFICATION PRIOR TO THE TIME AT WHICH SUCH VOTE
SHALL BE TAKEN. PURSUANT TO A RESOLUTION OF A MAJORITY OF THE TRUSTEES, PROXIES
MAY BE SOLICITED IN THE NAME OF ONE OR MORE TRUSTEES OR ONE OR MORE OFFICERS OF
THE TRUST. ONLY SHAREHOLDERS OF RECORD SHALL BE ENTITLED TO VOTE. EACH FULL
SHARE SHALL BE ENTITLED TO ONE VOTE, AND FRACTIONAL SHARES SHALL BE ENTITLED TO
A VOTE OF SUCH FRACTION. WHEN ANY SHARE IS HELD JOINTLY BY SEVERAL PERSONS, ANY
ONE OF THEM MAY VOTE AT ANY MEETING IN PERSON OR BY PROXY IN RESPECT OF SUCH
SHARE, BUT IF MORE THAN ONE OF THEM SHALL BE PRESENT AT SUCH MEETING IN PERSON
OR BY PROXY, AND SUCH JOINT OWNERS OR THEIR PROXIES DISAGREE AS TO ANY VOTE TO
BE CAST, SUCH VOTE SHALL NOT BE RECEIVED IN RESPECT OF SUCH SHARE. A PROXY
PURPORTING TO BE EXECUTED BY OR ON BEHALF OF A SHAREHOLDER SHALL BE DEEMED VALID
UNLESS CHALLENGED AT OR PRIOR TO ITS EXERCISE, AND THE BURDEN OF PROVING
INVALIDITY SHALL REST ON THE CHALLENGER. IF THE HOLDER OF ANY SUCH SHARE IS A
MINOR OR A PERSON OF UNSOUND MIND, AND SUBJECT TO GUARDIANSHIP OR TO THE LEGAL
CONTROL OF ANY OTHER PERSON AS REGARDS THE CHARGE OR MANAGEMENT OF SUCH SHARE,
HE MAY VOTE BY HIS GUARDIAN OR SUCH OTHER PERSON APPOINTED OR HAVING SUCH
CONTROL, AND SUCH VOTE MAY BE GIVEN IN PERSON OR BY PROXY.
SECTION 5. INSPECTION OF RECORDS. THE RECORDS, ACCOUNTS AND BOOKS OF THE TRUST
SHALL BE OPEN TO INSPECTION BY SHAREHOLDERS TO THE SAME EXTENT AS IS PERMITTED
SHAREHOLDERS OF A MASSACHUSETTS BUSINESS CORPORATION.
SECTION 6. ACTION WITHOUT MEETING. ANY ACTION WHICH MAY BE TAKEN BY SHAREHOLDERS
MAY BE TAKEN WITHOUT A MEETING IF ALL SHAREHOLDERS ENTITLED TO VOTE ON THE
MATTER CONSENT TO THE ACTION IN WRITING AND THE WRITTEN CONSENTS ARE FILED WITH
THE RECORDS OF THE MEETING OF SHAREHOLDERS. SUCH CONSENTS SHALL BE TREATED FOR
ALL PURPOSES AS A VOTE TAKEN AT A MEETING OF SHAREHOLDERS.
ARTICLE II
TRUSTEES
SECTION 1. THE TRUSTEES. THE TRUST SHALL HAVE EIGHT (8) TRUSTEES, UNLESS AND
UNTIL SUCH NUMBER BE CHANGED BY AMENDMENT OF THE BY-LAWS OR BY RESOLUTION OF THE
TRUSTEES. THE TERM OF OFFICE OF EACH TRUSTEE SHALL EXPIRE UPON THE ELECTION OF A
SUCCESSOR TRUSTEE AT A MEETING OF SHAREHOLDERS.
SECTION 2. MEETINGS OF TRUSTEES. THE TRUSTEES MAY IN THEIR DISCRETION PROVIDE
FOR REGULAR OR STATED MEETINGS OF THE TRUSTEES. NOTICE OF REGULAR OR STATED
MEETINGS NEED NOT BE GIVEN. MEETINGS OF THE TRUSTEES OTHER THAN REGULAR OR
STATED MEETINGS SHALL BE HELD WHENEVER CALLED BY THE PRESIDENT, OR BY ONE OF THE
TRUSTEES, AT THE TIME BEING IN OFFICE. NOTICE OF THE TIME AND PLACE OF EACH
MEETING OTHER THAN REGULAR OR STATED MEETINGS SHALL BE GIVEN BY THE SECRETARY OR
ASSISTANT SECRETARY OR BY THE OFFICER OR TRUSTEE CALLING THE MEETING AND SHALL
BE MAILED TO EACH TRUSTEE AT LEAST TWO DAYS BEFORE THE MEETING, OR SHALL BE
TELEGRAPHED, CABLED, OR PERSONALLY DELIVERED TO HIM AT LEAST ONE DAY BEFORE THE
MEETING. NOTICE BY TELEPHONE SHALL CONSTITUTE PERSONAL DELIVERY FOR THESE
PURPOSES. NOTICE MAY, HOWEVER, BE WAIVED BY ANY TRUSTEE BEFORE OR AFTER ANY
MEETING. NEITHER THE BUSINESS TO BE TRANSACTED AT, NOR THE PURPOSE OF ANY
MEETING OF THE 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. THE ATTENDANCE OF A TRUSTEE AT A MEETING SHALL CONSTITUTE A
WAIVER OF NOTICE OF SUCH MEETING EXCEPT WHERE A TRUSTEE ATTENDS A MEETING FOR
THE EXPRESS PURPOSE OF OBJECTING TO THE TRANSACTION OF ANY BUSINESS ON THE
GROUND THAT THE MEETING HAS NOT BEEN LAWFULLY CALLED OR CONVENED. THE TRUSTEES
MAY MEET BY MEANS OF A TELEPHONE CONFERENCE CIRCUIT OR SIMILAR COMMUNICATIONS
EQUIPMENT BY MEANS OF WHICH ALL PERSONS PARTICIPATING IN THE MEETING CAN HEAR
EACH OTHER, WHICH TELEPHONE CONFERENCE MEETING SHALL BE DEEMED TO HAVE BEEN HELD
AT A PLACE DESIGNATED BY THE TRUSTEES AT THE MEETING. PARTICIPATION IN A
TELEPHONE CONFERENCE MEETING SHALL CONSTITUTE PRESENCE IN PERSON AT SUCH
MEETING. ANY ACTION REQUIRED OR PERMITTED TO BE TAKEN AT ANY MEETING OF THE
TRUSTEES MAY BE TAKEN BY THE TRUSTEES WITHOUT A MEETING IF ALL THE TRUSTEES
CONSENT TO THE ACTION IN WRITING AND THE WRITTEN CONSENTS ARE FILED WITH THE
RECORDS OF THE TRUSTEES' MEETINGS. SUCH CONSENTS SHALL BE TREATED AS A VOTE FOR
ALL PURPOSES.
SECTION 3. QUORUM AND VOTE. A MAJORITY OF THE TRUSTEES SHALL BE PRESENT IN
PERSON AT ANY REGULAR OR SPECIAL MEETING OF THE TRUSTEES IN ORDER TO CONSTITUTE
A QUORUM FOR THE TRANSACTION OF BUSINESS AT SUCH MEETING AND (EXCEPT AS
OTHERWISE REQUIRED BY LAW, THE DECLARATION OF TRUST OR THESE BY-LAWS) THE ACT OF
A MAJORITY OF THE TRUSTEES PRESENT AT ANY MEETING AT WHICH A QUORUM IS PRESENT
SHALL BE THE ACT OF THE TRUSTEES. 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 ANY ADJOURNED MEETING NEED NOT BE GIVEN.
SECTION 4. COMPENSATION OF TRUSTEES. THE COMPENSATION OF THE TRUSTEES SHALL BE
FIXED FROM TIME TO TIME BY THE TRUSTEES. NO TRUSTEE SHALL BE PRECLUDED FROM
SERVING THE TRUST IN ANY OTHER CAPACITY, AS AN OFFICER, AGENT OR OTHERWISE, AND
RECEIVING COMPENSATION THEREFOR.
ARTICLE III
COMMITTEES
SECTION 1. EXECUTIVE AND OTHER COMMITTEES. 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) MEMBERS 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 AND SUCH OTHER
POWERS OF THE TRUSTEES AS THE TRUSTEES MAY, FROM TIME TO TIME, DELEGATE TO THEM
EXCEPT THOSE POWERS WHICH BY LAW, THE DECLARATION OF TRUST, OR THESE BY-LAWS
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 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 A DESIGNATION, THE COMMITTEE MAY ELECT ITS OWN
CHAIRMAN.
SECTION 2. MEETING, QUORUM AND MANNER OF ACTING. THE TRUSTEES MAY (1) PROVIDE
FOR STATED MEETINGS OF ANY COMMITTEES, (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.
ALL COMMITTEES SHALL KEEP REGULAR MINUTES OF THEIR 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. ALL ACTION BY
COMMITTEES SHALL BE REPORTED TO THE TRUSTEES AT THEIR MEETING NEXT SUCCEEDING
SUCH ACTION.
SECTION 3. COMPENSATION. THE MEMBERS OF ANY DULY APPOINTED COMMITTEE SHALL
RECEIVE SUCH COMPENSATION AND/OR FEES AS, FROM TIME TO TIME, MAY BE FIXED BY THE
TRUSTEES.
ARTICLE IV
OFFICERS
SECTION 1. GENERAL PROVISIONS. THE OFFICERS OF THE TRUST SHALL BE A PRESIDENT
AND A SECRETARY WHO SHALL BE ELECTED BY THE TRUSTEES. THE TRUSTEES MAY ELECT OR
APPOINT SUCH OTHER OFFICERS OR AGENTS AS THE BUSINESS OF THE TRUST MAY REQUIRE,
INCLUDING A CHAIRMAN, A TREASURER, ONE OR MORE VICE PRESIDENTS, ONE OR MORE
ASSISTANT SECRETARIES, AND ONE OR MORE ASSISTANT TREASURERS. THE TRUSTEES MAY
DELEGATE TO ANY OFFICER OR COMMITTEE THE POWER TO APPOINT ANY SUBORDINATE
OFFICERS OR AGENTS.
SECTION 2. TERM OF OFFICE AND QUALIFICATIONS. EXCEPT AS OTHERWISE PROVIDED BY
LAW, THE DECLARATION OF TRUST OR THESE BY-LAWS, THE PRESIDENT AND THE SECRETARY
SHALL EACH HOLD OFFICE UNTIL HIS SUCCESSOR SHALL HAVE BEEN DULY ELECTED AND
QUALIFIED, AND ALL OTHER OFFICERS SHALL HOLD OFFICE AT THE PLEASURE OF THE
TRUSTEES. 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 CHAIRMAN, IF
THERE BE SUCH AN OFFICER, AND THE PRESIDENT SHALL BE TRUSTEES, BUT NO OTHER
OFFICER OF THE TRUST NEED BE A TRUSTEE.
SECTION 3. REMOVAL. THE TRUSTEES, AT ANY REGULAR OR SPECIAL MEETING OF THE
TRUSTEES, MAY REMOVE ANY OFFICER WITH OR WITHOUT CAUSE BY A VOTE OF THE MAJORITY
OF THE TRUSTEES. ANY OFFICER OR AGENT APPOINTED BY ANY OFFICER OR COMMITTEE MAY
BE REMOVED WITH OR WITHOUT CAUSE BY SUCH APPOINTING OFFICER OR COMMITTEE.
SECTION 4. BONDS AND SURETY. ANY OFFICER MAY BE REQUIRED BY THE TRUSTEES TO BE
BONDED FOR THE FAITHFUL PERFORMANCE OF HIS DUTIES IN SUCH AMOUNT AND WITH SUCH
SURETIES AS THE TRUSTEES MAY DETERMINE.
SECTION 5. CHAIRMAN, PRESIDENT, AND VICE-PRESIDENTS. THE CHAIRMAN, IF THERE BE
SUCH AN OFFICER, SHALL, IF PRESENT, PRESIDE AT ALL MEETINGS OF THE SHAREHOLDERS
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, 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, THE PRESIDENT SHALL PRESIDE AT
ALL MEETINGS OF THE SHAREHOLDERS AND OF THE TRUSTEES. THE PRESIDENT SHALL HAVE
THE POWER IN THE NAME AND ON BEHALF OF THE TRUST TO GRANT, ISSUE, EXECUTE OR
SIGN ANY AND ALL DOCUMENTS, CONTRACTS, AGREEMENTS, DEEDS, MORTGAGES, PROXIES,
POWERS OF ATTORNEY OR OTHER INSTRUMENTS AS MAY BE DEEMED ADVISABLE OR NECESSARY
IN FURTHERANCE OF THE INTERESTS OF THE TRUST. THE PRESIDENT SHALL HAVE THE POWER
TO EMPLOY ATTORNEYS AND COUNSEL FOR THE TRUST AND TO EMPLOY SUCH SUBORDINATE
OFFICERS, AGENTS, CLERKS AND EMPLOYEES AS HE MAY FIND NECESSARY TO TRANSACT THE
BUSINESS OF THE TRUST. THE PRESIDENT SHALL HAVE SUCH FURTHER POWERS AND DUTIES
AS, FROM TIME TO TIME, MAY BE CONFERRED UPON HIM OR ASSIGNED TO HIM BY THE
TRUSTEES. IN THE ABSENCE OR DISABILITY OF THE PRESIDENT, THE VICE-PRESIDENT OR,
IF THERE BE MORE THAN ONE VICE-PRESIDENT, ANY VICE-PRESIDENT DESIGNATED BY THE
TRUSTEES SHALL PERFORM ALL OF THE DUTIES OF THE PRESIDENT, AND WHEN SO ACTING
SHALL HAVE ALL THE POWERS OF THE PRESIDENT, SUBJECT TO THE DIRECTION OF THE
TRUSTEES. EACH VICE-PRESIDENT SHALL PERFORM SUCH OTHER DUTIES AS MAY BE ASSIGNED
TO HIM FROM TIME TO TIME BY THE TRUSTEES OR THE PRESIDENT.
SECTION 6. SECRETARY. THE SECRETARY SHALL KEEP THE MINUTES OF ALL MEETINGS OF,
AND RECORD ALL VOTES OF, THE SHAREHOLDERS, THE TRUSTEES AND COMMITTEES, IF ANY,
IN PROPER BOOKS PROVIDED FOR THAT PURPOSE. HE SHALL BE CUSTODIAN OF THE SEAL OF
THE TRUST; HE SHALL HAVE CHARGE OF THE SHARE TRANSFER BOOKS, LISTS AND RECORDS
UNLESS THE SAME ARE IN THE CHARGE OF A TRANSFER AGENT. HE SHALL ATTEND TO THE
GIVING AND SERVING OF ALL NOTICES BY THE TRUST IN ACCORDANCE WITH THE PROVISIONS
OF THESE BY-LAWS AND AS REQUIRED BY LAW; AND SUBJECT TO THESE BY-LAWS, HE SHALL
IN GENERAL PERFORM ALL DUTIES INCIDENT TO THE OFFICE OF SECRETARY AND SUCH OTHER
DUTIES AS FROM TIME TO TIME MAY BE ASSIGNED TO HIM BY THE TRUSTEES. THE
SECRETARY MAY DELEGATE ANY OF HIS POWER, AUTHORITY OR DUTIES TO ANY ASSISTANT
SECRETARY OF THE TRUST.
SECTION 7. TREASURER. THE TREASURER, IF THERE BE SUCH AN OFFICER, SHALL BE THE
PRINCIPAL FINANCIAL AND ACCOUNTING OFFICER OF THE TRUST. HE SHALL DELIVER ALL
FUNDS OF THE TRUST WHICH MAY COME INTO HIS HANDS TO SUCH CUSTODIAN,
SUBCUSTODIAN, OR SPECIAL DEPOSITORY AS THE TRUSTEES SHALL EMPLOY PURSUANT TO
ARTICLE IX OF THE DECLARATION OF TRUST. HE SHALL RENDER A STATEMENT OF CONDITION
OF THE FINANCES OF THE TRUST TO THE TRUSTEES AS OFTEN AS THEY SHALL REQUIRE THE
SAME, AND HE SHALL IN GENERAL PERFORM ALL THE DUTIES INCIDENT TO THE OFFICE OF
TREASURER AND SUCH OTHER DUTIES AS FROM TIME TO TIME MAY BE ASSIGNED TO HIM BY
THE TRUSTEES. THE TREASURER MAY DELEGATE ANY OF HIS POWER, AUTHORITY OR DUTIES
TO ANY ASSISTANT TREASURER OF THE TRUST.
SECTION 8. 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 OR DISABILITY OF THE OFFICER WHOM THEY ASSIST
AND SHALL ASSIST THAT OFFICER IN THE DUTIES OF HIS OFFICE. EACH OFFICER,
EMPLOYEE, AGENT OF THE TRUST SHALL HAVE SUCH OTHER DUTIES AND AUTHORITY AS MAY
BE ASSIGNED HIM BY THE PRESIDENT.
SECTION 9. EVIDENCE OF AUTHORITY. ANYONE DEALING WITH THE TRUST SHALL BE FULLY
JUSTIFIED IN RELYING ON A COPY OF A RESOLUTION OF THE TRUSTEES OR OF ANY
COMMITTEE THEREOF EMPOWERED TO ACT IN THE PREMISES WHICH IS CERTIFIED AS TRUE BY
THE SECRETARY OR AN ASSISTANT SECRETARY UNDER THE SEAL OF THE TRUST.
SECTION 10. COMPENSATION. THE COMPENSATION OF THE OFFICERS SHALL BE FIXED FROM
TIME TO TIME BY THE TRUSTEES OR BY ANY COMMITTEE OR OFFICER UPON WHOM SUCH POWER
MAY BE CONFERRED BY THE TRUSTEES. NO OFFICER SHALL BE PREVENTED FROM RECEIVING
SUCH COMPENSATION BY REASON OF THE FACT THAT HE IS ALSO A TRUSTEE.
ARTICLE V
FISCAL YEAR
THE FISCAL YEAR OF THE TRUST SHALL BEGIN ON THE FIRST DAY OF OCTOBER IN EACH
YEAR AND SHALL END ON THE 31ST DAY OF SEPTEMBER IN EACH YEAR, PROVIDED, HOWEVER,
THAT THE TRUSTEES MAY FROM TIME TO TIME CHANGE THE FISCAL YEAR.
ARTICLE VI
SEAL
THE TRUSTEES MAY ADOPT A SEAL WHICH SHALL BE IN SUCH FORM AND SHALL HAVE SUCH
INSCRIPTION THEREON AS THE TRUSTEES MAY FROM TIME TO TIME PRESCRIBE.
ARTICLE VII
WAIVERS OF NOTICE
WHENEVER ANY NOTICE WHATEVER IS REQUIRED TO BE GIVEN BY LAW, THE DECLARATION OF
TRUST OR THESE BY-LAWS, 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 GIVEN IF TELEGRAPHED, CABLED, OR SENT BY WIRELESS AT THE TIME WHEN IT HAS
BEEN DELIVERED TO A REPRESENTATIVE OF ANY TELEGRAPH, CABLE OR WIRELESS COMPANY
WITH INSTRUCTIONS THAT IT BE TELEGRAPHED, CABLED OR SENT BY WIRELESS. ANY NOTICE
SHALL BE DEEMED TO HAVE BEEN GIVEN IF MAILED AT THE TIME WHEN IT HAS BEEN
DEPOSITED IN THE MAIL.
ARTICLE VIII
SHARES OF BENEFICIAL INTEREST
SECTION 1. BENEFICIAL INTEREST. THE BENEFICIAL INTEREST IN THE TRUST SHALL AT
ALL TIMES BE DIVIDED INTO AN UNLIMITED NUMBER OF SHARES WITHOUT PAR VALUE WHICH
THE TRUSTEES MAY FROM TIME TO TIME ISSUE AND SELL OR CAUSE TO BE ISSUED AND
SOLD.
SECTION 2. BOOK ENTRY SHARES. NO CERTIFICATES NEED BE ISSUED TO REPRESENT SHARES
IN THE TRUST. THE TRUST SHALL MAINTAIN ADEQUATE RECORDS TO DETERMINE THE
HOLDINGS OF EACH SHAREHOLDER OF RECORD, AND SUCH RECORDS SHALL BE DEEMED THE
EQUIVALENT OF A CERTIFICATE REPRESENTING THE SHARES FOR ALL PURPOSES.
SECTION 3. CERTIFICATES. ALL CERTIFICATES FOR SHARES SHALL BE SIGNED BY THE
CHAIRMAN, PRESIDENT OR ANY VICE-PRESIDENT AND BY THE TREASURER, SECRETARY OR
ASSISTANT TREASURER OR ASSISTANT SECRETARY AND SEALED WITH THE SEAL OF THE
TRUST. THE SIGNATURES MAY BE EITHER MANUAL OR FACSIMILE SIGNATURES, AND THE SEAL
MAY BE EITHER FACSIMILE OR ANY OTHER FORM OF SEAL. CERTIFICATES FOR SHARES FOR
WHICH THE TRUST HAS APPOINTED A TRANSFER AGENT SHALL NOT BE VALID UNLESS
COUNTERSIGNED BY SUCH TRANSFER AGENT.
SECTION 4. TRANSFER OF SHARES. THE SHARES OF THE TRUST SHALL BE TRANSFERABLE, SO
AS TO AFFECT THE RIGHTS OF THE TRUST, ONLY BY TRANSFER RECORDED IN THE BOOKS OF
THE TRUST, IN PERSON OR BY ATTORNEY.
SECTION 5. EQUITABLE INTEREST NOT RECOGNIZED. THE TRUST SHALL BE ENTITLED TO
TREAT THE HOLDER OF RECORD OF ANY SHARE AS THE ABSOLUTE OWNER THEREOF AND SHALL
NOT BE BOUND TO RECOGNIZE ANY EQUITABLE OR OTHER CLAIM OR INTEREST IN SUCH SHARE
ON THE PART OF ANY OTHER PERSON EXCEPT AS MAY BE OTHERWISE EXPRESSLY PROVIDED BY
LAW.
SECTION 6. LOST, DESTROYED OR MUTILATED CERTIFICATES. IN CASE ANY CERTIFICATE
FOR SHARES IS LOST, MUTILATED OR DESTROYED, THE TRUSTEES MAY ISSUE A NEW
CERTIFICATE IN PLACE THEREOF UPON SUCH INDEMNITY TO THE TRUST AGAINST LOSS AND
UPON SUCH OTHER TERMS AND CONDITIONS AS THE TRUSTEES MAY DEEM ADVISABLE.
ARTICLE IX
AMENDMENTS
THESE BY-LAWS, OR ANY OF THEM, MAY BE ALTERED, AMENDED OR REPEALED, OR NEW
BY-LAWS MAY BE ADOPTED BY (A) VOTE OF A MAJORITY OF THE SHARES OUTSTANDING AND
ENTITLED TO VOTE OR (B) BY THE TRUSTEES, PROVIDED, HOWEVER, THAT NO BY-LAWS MAY
BE AMENDED, ADOPTED OR REPEALED BY THE TRUSTEES IF SUCH AMENDMENT, ADOPTION OR
REPEAL REQUIRES, PURSUANT TO LAW, THE DECLARATION OF TRUST OR THESE BY-LAWS, A
VOTE OF THE SHAREHOLDERS.
ARTICLE X
BOOKS AND RECORDS
THE BOOKS, ACCOUNTS AND RECORDS OF THE TRUST, INCLUDING THE STOCK LEDGER OR
LEDGERS, MAY BE KEPT IN OR OUTSIDE THE COMMONWEALTH OF MASSACHUSETTS AT SUCH
OFFICES OR AGENCIES OF THE TRUST AS MAY FROM TIME TO TIME BE DETERMINED BY THE
TRUSTEES.
Calvert Cash Reserves
Investment Advisory Agreement
March 1, 1999
Page 4 of 6
INVESTMENT ADVISORY AGREEMENT
CALVERT CASH RESERVES
INVESTMENT ADVISORY AGREEMENT, MADE THIS 1ST DAY OF MARCH, 1999, BY AND
BETWEEN CALVERT ASSET MANAGEMENT COMPANY, INC., A DELAWARE CORPORATION (THE
"ADVISOR"), AND CALVERT CASH RESERVES, A MASSACHUSETTS BUSINESS TRUST CREATED
PURSUANT TO A DECLARATION OF TRUST FILED WITH THE SECRETARY OF STATE OF THE
COMMONWEALTH OF MASSACHUSETTS (THE "TRUST"), BOTH HAVING THEIR PRINCIPAL PLACE
OF BUSINESS AT 4550 MONTGOMERY AVENUE, BETHESDA, MARYLAND.
WHEREAS, THE TRUST IS REGISTERED AS AN INVESTMENT COMPANY UNDER THE
INVESTMENT COMPANY ACT OF 1940, AS AMENDED (THE "1940 ACT"), FOR THE PURPOSE OF
INVESTING AND REINVESTING ITS ASSETS IN SECURITIES, AS SET FORTH IN ITS
DECLARATION OF TRUST, ITS BY-LAWS AND ITS REGISTRATION STATEMENTS UNDER THE 1940
ACT AND THE SECURITIES ACT OF 1933 (THE "1933 ACT"), AS AMENDED; AND THE TRUST
DESIRES TO AVAIL ITSELF OF THE SERVICES, INFORMATION, ADVICE, ASSISTANCE AND
FACILITIES OF AN INVESTMENT ADVISOR AND TO HAVE AN INVESTMENT ADVISOR PERFORM
FOR IT VARIOUS INVESTMENT ADVISORY, RESEARCH SERVICES AND OTHER MANAGEMENT
SERVICES; AND
WHEREAS, THE ADVISOR IS AN INVESTMENT ADVISOR REGISTERED UNDER THE
INVESTMENT ADVISERS ACT OF 1940, AS AMENDED, AND IS ENGAGED IN THE BUSINESS OF
RENDERING MANAGEMENT AND INVESTMENT ADVISORY SERVICES TO INVESTMENT COMPANIES
AND DESIRES TO PROVIDE SUCH SERVICES TO THE TRUST;
NOW, THEREFORE, IN CONSIDERATION OF THE TERMS AND CONDITIONS HEREINAFTER
SET FORTH, IT IS AGREED AS FOLLOWS:
1. EMPLOYMENT OF THE ADVISOR. THE TRUST HEREBY EMPLOYS THE ADVISOR TO MANAGE
THE INVESTMENT AND REINVESTMENT OF THE TRUST ASSETS, SUBJECT TO THE CONTROL AND
DIRECTION OF THE TRUST'S BOARD OF TRUSTEES, FOR THE PERIOD AND ON THE TERMS
HEREINAFTER SET FORTH. THE ADVISOR HEREBY ACCEPTS SUCH EMPLOYMENT AND AGREES
DURING SUCH PERIOD TO RENDER THE SERVICES AND TO ASSUME THE OBLIGATIONS IN
RETURN FOR THE COMPENSATION PROVIDED HEREIN. THE ADVISOR SHALL FOR ALL PURPOSES
HEREIN BE DEEMED TO BE AN INDEPENDENT CONTRACTOR AND SHALL, EXCEPT AS EXPRESSLY
PROVIDED OR AUTHORIZED (WHETHER HEREIN OR OTHERWISE), HAVE NO AUTHORITY TO ACT
FOR OR REPRESENT THE TRUST IN ANY WAY OR OTHERWISE BE DEEMED AN AGENT OF THE
TRUST.
2. OBLIGATIONS OF AND SERVICES TO BE PROVIDED BY THE ADVISOR. THE ADVISOR
UNDERTAKES TO PROVIDE THE FOLLOWING SERVICES AND TO ASSUME THE FOLLOWING
OBLIGATIONS:
A. THE ADVISOR SHALL MANAGE THE INVESTMENT AND REINVESTMENT OF THE TRUST'S
ASSETS, SUBJECT TO AND IN ACCORDANCE WITH THE INVESTMENT OBJECTIVES AND POLICIES
OF THE TRUST AND ANY DIRECTIONS WHICH THE TRUST'S BOARD OF TRUSTEES MAY ISSUE
FROM TIME TO TIME. IN PURSUANCE OF THE FOREGOING, THE ADVISOR SHALL MAKE ALL
DETERMINATIONS WITH RESPECT TO THE INVESTMENT OF THE TRUST'S ASSETS AND THE
PURCHASE AND SALE OF PORTFOLIO SECURITIES AND SHALL TAKE SUCH STEPS AS MAY BE
NECESSARY TO IMPLEMENT THE SAME. SUCH DETERMINATION AND SERVICES SHALL ALSO
INCLUDE DETERMINING THE MANNER IN WHICH VOTING RIGHTS, RIGHTS TO CONSENT TO
CORPORATE ACTION, ANY OTHER RIGHTS PERTAINING TO THE TRUST'S PORTFOLIO
SECURITIES SHALL BE EXERCISED. THE ADVISOR SHALL RENDER REGULAR REPORTS TO THE
TRUST'S BOARD OF TRUSTEES CONCERNING THE TRUST'S INVESTMENT ACTIVITIES.
B. THE ADVISOR SHALL, IN THE NAME OF THE TRUST ON BEHALF OF THE TRUST, PLACE
ORDERS FOR THE EXECUTION OF THE TRUST'S PORTFOLIO TRANSACTIONS IN ACCORDANCE
WITH THE POLICIES WITH RESPECT THERETO SET FORTH IN THE TRUST'S REGISTRATION
STATEMENTS UNDER THE 1940 ACT AND THE 1933 ACT, AS SUCH REGISTRATION STATEMENTS
MAY BE AMENDED FROM TIME TO TIME. IN CONNECTION WITH THE PLACEMENT OF ORDERS FOR
THE EXECUTION OF THE TRUST'S PORTFOLIO TRANSACTIONS THE ADVISOR SHALL CREATE AND
MAINTAIN ALL NECESSARY BROKERAGE RECORDS OF THE TRUST IN ACCORDANCE WITH ALL
APPLICABLE LAWS, RULES AND REGULATIONS, INCLUDING BUT NOT LIMITED TO RECORDS
REQUIRED BY SECTION 31(A) OF THE 1940 ACT. ALL RECORDS SHALL BE THE PROPERTY OF
THE TRUST AND SHALL BE AVAILABLE FOR INSPECTION AND USE BY THE SEC, THE TRUST OR
ANY PERSON RETAINED BY THE TRUST. WHERE APPLICABLE, SUCH RECORDS SHALL BE
MAINTAINED BY THE ADVISOR FOR THE PERIODS AND THE PLACES REQUIRED BY RULE 31A-2
UNDER THE 1940 ACT.
C. THE ADVISOR SHALL BEAR ITS EXPENSES OF PROVIDING SERVICES TO THE TRUST
PURSUANT TO THIS AGREEMENT EXCEPT SUCH EXPENSES AS ARE UNDERTAKEN BY THE TRUST.
IN ADDITION, THE ADVISOR SHALL PAY THE SALARIES AND FEES OF ALL TRUSTEES AND
EXECUTIVE OFFICERS WHO ARE EMPLOYEES OF THE ADVISOR OR ITS AFFILIATES ("ADVISOR
EMPLOYEES").
3. EXPENSES OF THE TRUST. THE TRUST SHALL PAY ALL EXPENSES OTHER THAN THOSE
EXPRESSLY ASSUMED BY THE ADVISOR HEREIN, WHICH EXPENSES PAYABLE BY THE TRUST
SHALL INCLUDE, BUT ARE NOT LIMITED TO:
A. FEES TO THE ADVISOR AS PROVIDED HEREIN;
B. LEGAL AND AUDIT EXPENSES;
C. FEES AND EXPENSES RELATED TO THE REGISTRATION AND QUALIFICATION OF THE
TRUST AND ITS SHARES FOR DISTRIBUTION UNDER FEDERAL AND STATE SECURITIES LAWS;
D. EXPENSES OF THE ADMINISTRATIVE SERVICES AGENT, TRANSFER AGENT, REGISTRAR,
CUSTODIAN, DIVIDEND DISBURSING AGENT AND SHAREHOLDER SERVICING AGENT;
E. ANY TELEPHONE CHARGES ASSOCIATED WITH SHAREHOLDER SERVICING OR THE
MAINTENANCE OF THE FUNDS OR TRUST;
F. SALARIES, FEES AND EXPENSES OF TRUSTEES AND EXECUTIVE OFFICERS OF THE
TRUST, OTHER THAN ADVISOR EMPLOYEES;
G. TAXES AND CORPORATE FEES LEVIED AGAINST THE TRUST;
H. BROKERAGE COMMISSIONS AND OTHER EXPENSES ASSOCIATED WITH THE PURCHASE AND
SALE OF PORTFOLIO SECURITIES FOR THE TRUST;
I. EXPENSES, INCLUDING INTEREST, OF BORROWING MONEY;
J. EXPENSES INCIDENTAL TO MEETINGS OF THE TRUST'S SHAREHOLDERS AND THE
MAINTENANCE OF THE TRUST'S ORGANIZATIONAL EXISTENCE;
K. EXPENSES OF PRINTING STOCK CERTIFICATES REPRESENTING SHARES OF THE TRUST
AND EXPENSES OF PREPARING, PRINTING AND MAILING NOTICES, PROXY MATERIAL, REPORTS
TO REGULATORY BODIES AND REPORTS TO SHAREHOLDERS OF THE TRUST;
L. EXPENSES OF PREPARING AND TYPESETTING OF PROSPECTUSES OF THE TRUST;
M. EXPENSES OF PRINTING AND DISTRIBUTING PROSPECTUSES TO SHAREHOLDERS OF THE
TRUST;
N. ASSOCIATION MEMBERSHIP DUES;
O. INSURANCE PREMIUMS FOR FIDELITY AND OTHER COVERAGE;
P. DISTRIBUTION PLAN EXPENSES, AS PERMITTED BY RULE 12B-1 UNDER THE 1940 ACT
AND AS APPROVED BY THE BOARD; AND
Q. SUCH OTHER LEGITIMATE TRUST EXPENSES AS THE BOARD OF TRUSTEES MAY FROM
TIME TO TIME DETERMINE ARE PROPERLY CHARGEABLE TO THE TRUST.
4. COMPENSATION OF ADVISOR.
A. AS COMPENSATION FOR THE SERVICES RENDERED AND OBLIGATIONS ASSUMED
HEREUNDER BY THE ADVISOR, THE TRUST SHALL PAY TO THE ADVISOR WITHIN TEN (10)
DAYS AFTER THE LAST DAY OF EACH CALENDAR MONTH A FEE EQUAL ON AN ANNUALIZED
BASIS AS SHOWN ON SCHEDULE A. ANY AMENDMENT TO THE SCHEDULE PERTAINING TO ANY
NEW OR EXISTING FUND SHALL NOT BE DEEMED TO AFFECT THE INTEREST OF ANY OTHER
FUND AND SHALL NOT REQUIRE THE APPROVAL OF THE SHAREHOLDERS OF ANY OTHER FUND.
B. SUCH FEE SHALL BE COMPUTED AND ACCRUED DAILY. UPON TERMINATION OF THIS
AGREEMENT BEFORE THE END OF ANY CALENDAR MONTH, THE FEE FOR SUCH PERIOD SHALL BE
PRORATED. FOR PURPOSES OF CALCULATING THE ADVISOR'S FEE, THE DAILY VALUE OF A
FUND'S NET ASSETS SHALL BE COMPUTED BY THE SAME METHOD AS THE FUND USES TO
COMPUTE THE VALUE OF ITS NET ASSETS IN CONNECTION WITH THE DETERMINATION OF THE
NET ASSET VALUE OF ITS SHARES.
C. THE ADVISOR RESERVES THE RIGHT (I) TO WAIVE ALL OR PART OF ITS FEE AND
ASSUME EXPENSES OF A FUND AND (II) TO MAKE PAYMENTS TO BROKERS AND DEALERS IN
CONSIDERATION OF THEIR PROMOTIONAL OR ADMINISTRATIVE SERVICES.
5. ACTIVITIES OF THE ADVISOR. THE SERVICES OF THE ADVISOR TO THE TRUST
HEREUNDER ARE NOT TO BE DEEMED EXCLUSIVE, AND THE ADVISOR SHALL BE FREE TO
RENDER SIMILAR SERVICES TO OTHERS. IT IS UNDERSTOOD THAT TRUSTEES AND OFFICERS
OF THE TRUST ARE OR MAY BECOME INTERESTED IN THE ADVISOR AS STOCKHOLDERS,
OFFICERS, OR OTHERWISE, AND THAT STOCKHOLDERS AND OFFICERS OF THE ADVISOR ARE OR
MAY BECOME SIMILARLY INTERESTED IN THE TRUST, AND THAT THE ADVISOR MAY BECOME
INTERESTED IN THE TRUST AS A SHAREHOLDER OR OTHERWISE.
6. USE OF NAMES. THE TRUST SHALL NOT USE THE NAME OF THE ADVISOR IN ANY
PROSPECTUS, SALES LITERATURE OR OTHER MATERIAL RELATING TO THE TRUST IN ANY
MANNER NOT APPROVED PRIOR THERETO BY THE ADVISOR; PROVIDED, HOWEVER, THAT THE
ADVISOR SHALL APPROVE ALL USES OF ITS NAME WHICH MERELY REFER IN ACCURATE TERMS
TO ITS APPOINTMENT HEREUNDER OR WHICH ARE REQUIRED BY THE SEC; AND, PROVIDED,
FURTHER, THAT IN NO EVENT SHALL SUCH APPROVAL BE UNREASONABLY WITHHELD. THE
ADVISOR SHALL NOT USE THE NAME OF THE TRUST OR ANY TRUST IN ANY MATERIAL
RELATING TO THE ADVISOR IN ANY MANNER NOT APPROVED PRIOR THERETO BY THE TRUST;
PROVIDED, HOWEVER, THAT THE TRUST SHALL APPROVE ALL USES OF ITS NAME WHICH
MERELY REFER IN ACCURATE TERMS TO THE APPOINTMENT OF THE ADVISOR HEREUNDER OR
WHICH ARE REQUIRED BY THE SEC; AND, PROVIDE, FURTHER, THAT IN NO EVENT SHALL
SUCH APPROVAL BE UNREASONABLY WITHHELD.
7. LIABILITY OF THE ADVISOR. ABSENT WILLFUL MISFEASANCE, BAD FAITH, GROSS
NEGLIGENCE, OR RECKLESS DISREGARD OF OBLIGATIONS OR DUTIES HEREUNDER ON THE PART
OF THE ADVISOR, THE ADVISOR SHALL NOT BE SUBJECT TO LIABILITY TO THE TRUST OR TO
ANY SHAREHOLDER OF THE TRUST FOR ANY ACT OR OMISSION IN THE COURSE OF, OR
CONNECTED WITH, RENDERING SERVICES HEREUNDER OR FOR ANY LOSSES THAT MAY BE
SUSTAINED IN THE PURCHASE, HOLDING OR SALE OF ANY SECURITY.
8. FORCE MAJEURE. THE ADVISOR SHALL NOT BE LIABLE FOR DELAYS OR ERRORS
OCCURRING BY REASON OF CIRCUMSTANCES BEYOND ITS CONTROL, INCLUDING BUT NOT
LIMITED TO ACTS OF CIVIL OR MILITARY AUTHORITY, NATIONAL EMERGENCIES, WORK
STOPPAGES, FIRE, FLOOD, CATASTROPHE, ACTS OF GOD, INSURRECTION, WAR, RIOT, OR
FAILURE OF COMMUNICATION OR POWER SUPPLY. IN THE EVENT OF EQUIPMENT BREAKDOWNS
BEYOND ITS CONTROL, THE ADVISOR SHALL TAKE REASONABLE STEPS TO MINIMIZE SERVICE
INTERRUPTIONS BUT SHALL HAVE NO LIABILITY WITH RESPECT THERETO.
9. RENEWAL, TERMINATION AND AMENDMENT. THIS AGREEMENT SHALL CONTINUE IN
EFFECT WITH RESPECT TO THE TRUST, UNLESS SOONER TERMINATED AS HEREINAFTER
PROVIDED, THROUGH DECEMBER 31, 1999, AND INDEFINITELY THEREAFTER IF ITS
CONTINUANCE SHALL BE SPECIFICALLY APPROVED AT LEAST ANNUALLY BY VOTE OF THE
HOLDERS OF A MAJORITY OF THE OUTSTANDING VOTING SECURITIES OF THE TRUST OR BY
VOTE OF A MAJORITY OF THE TRUST'S BOARD OF TRUSTEES; AND FURTHER PROVIDED THAT
SUCH CONTINUANCE IS ALSO APPROVED ANNUALLY BY THE VOTE OF A MAJORITY OF THE
TRUSTEES WHO ARE NOT PARTIES TO THIS AGREEMENT OR INTERESTED PERSONS OF THE
ADVISOR, CAST IN PERSON AT A MEETING CALLED FOR THE PURPOSE OF VOTING ON SUCH
APPROVAL, OR AS ALLOWED BY LAW. THIS AGREEMENT MAY BE TERMINATED AT ANY TIME,
WITHOUT PAYMENT OF ANY PENALTY, BY THE TRUST'S BOARD OF TRUSTEES OR BY A VOTE OF
THE MAJORITY OF THE OUTSTANDING VOTING SECURITIES OF THE TRUST UPON 60 DAYS'
PRIOR WRITTEN NOTICE TO THE ADVISOR AND BY THE ADVISOR UPON 60 DAYS' PRIOR
WRITTEN NOTICE TO THE TRUST. THIS AGREEMENT MAY BE AMENDED AT ANY TIME BY THE
PARTIES, SUBJECT TO APPROVAL BY THE TRUST'S BOARD OF TRUSTEES AND, IF REQUIRED
BY APPLICABLE SEC RULES AND REGULATIONS, A VOTE OF A MAJORITY OF THE TRUST'S
OUTSTANDING VOTING SECURITIES. THIS AGREEMENT SHALL TERMINATE AUTOMATICALLY IN
THE EVENT OF ITS ASSIGNMENT. THE TERMS "ASSIGNMENT" AND "VOTE OF A MAJORITY OF
THE OUTSTANDING VOTING SECURITIES" SHALL HAVE THE MEANING SET FORTH FOR SUCH
TERMS IN THE 1940 ACT.
10. SEVERABILITY. IF ANY PROVISION OF THIS AGREEMENT SHALL BE HELD OR MADE
INVALID BY A COURT DECISION, STATUTE, RULE OR OTHERWISE, THE REMAINDER OF THIS
AGREEMENT SHALL NOT BE AFFECTED THEREBY.
11. MISCELLANEOUS. EACH PARTY AGREES TO PERFORM SUCH FURTHER ACTIONS AND
EXECUTE SUCH FURTHER DOCUMENTS AS ARE NECESSARY TO EFFECTUATE THE PURPOSES
HEREOF. THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH AND
GOVERNED BY THE LAWS OF THE STATE OF MARYLAND. THE CAPTIONS IN THIS AGREEMENT
ARE INCLUDED FOR CONVENIENCE ONLY AND IN NO WAY DEFINE OR DELIMIT ANY OF THE
PROVISIONS HEREOF OR OTHERWISE AFFECT THEIR CONSTRUCTION OR EFFECT.
IN WITNESS WHEREOF, THE PARTIES HAVE DULY EXECUTED THIS AGREEMENT AS OF THE
DATE FIRST WRITTEN ABOVE.
CALVERT CASH RESERVES
BY:
TITLE:
CALVERT ASSET MANAGEMENT COMPANY, INC.
BY:
TITLE:
<PAGE>
INVESTMENT ADVISORY AGREEMENT
CALVERT ASSET MANAGEMENT COMPANY, INC.
CALVERT CASH RESERVES
SCHEDULE A
AS COMPENSATION PURSUANT TO SECTION 4 OF THE INVESTMENT ADVISORY AGREEMENT
BETWEEN CALVERT ASSET MANAGEMENT COMPANY, INC. (THE "ADVISOR") AND CALVERT CASH
RESERVES DATED MARCH 1, 1999, THE ADVISOR IS ENTITLED TO RECEIVE AN ANNUAL
ADVISORY FEE (THE "FEE") OF 0.25%. THE FEE SHALL BE COMPUTED DAILY AND PAYABLE
MONTHLY, BASED ON THE AVERAGE DAILY NET ASSETS OF THE INSTITUTIONAL PRIME FUND.
E:\AGREEMENTS\CCR\OLD Agmts\CCR_UNDERWRITING_AGMT.DOC
UNDERWRITING AGREEMENT
THIS UNDERWRITING AGREEMENT, AMENDED AND RESTATED APRIL 1, 1995, BY AND
BETWEEN CALVERT CASH RESERVES, DOING BUSINESS AS MONEY MANAGEMENT PLUS (THE
"FUND"), A MASSACHUSETTS BUSINESS TRUST, AND CALVERT DISTRIBUTORS, INC., A
DELAWARE CORPORATION (THE "DISTRIBUTOR").
WHEREAS, THE FUND IS REGISTERED AS AN OPEN-END, DIVERSIFIED INVESTMENT
COMPANY UNDER THE INVESTMENT COMPANY ACT OF L940 (THE "L940 ACT") AND HAS
REGISTERED ITS SHARES, INCLUDING SHARES OF ITS SERIES, THE PRIME AND GOVERNMENT
PORTFOLIOS (THE "SERIES"), FOR SALE TO THE PUBLIC UNDER THE SECURITIES ACT OF
L933 (THE "L933 ACT") AND VARIOUS STATE SECURITIES LAWS;
WHEREAS, THE FUND WISHES TO RETAIN THE DISTRIBUTOR AS THE PRINCIPAL
UNDERWRITER IN CONNECTION WITH THE OFFER AND SALE OF SHARES OF THE SERIES (THE
"SHARES") AND TO FURNISH CERTAIN OTHER SERVICES TO THE SERIES AS SPECIFIED IN
THIS AGREEMENT;
WHEREAS, THIS AGREEMENT HAS BEEN APPROVED BY A VOTE OF THE FUND'S BOARD OF
TRUSTEES AND CERTAIN TRUSTEES WHO ARE NOT INTERESTED PERSONS OF THE FUND, IN
CONFORMITY WITH THE L940 ACT AND THE RULES AND REGULATIONS THEREUNDER; AND
WHEREAS, THE DISTRIBUTOR IS WILLING TO ACT AS PRINCIPAL UNDERWRITER AND TO
FURNISH SUCH SERVICES ON THE TERMS AND CONDITIONS HEREINAFTER SET FORTH;
NOW, THEREFORE, IN CONSIDERATION OF THE PROMISES AND MUTUAL COVENANTS
HEREIN CONTAINED, IT IS AGREED AS FOLLOWS:
L. THE FUND HEREBY APPOINTS THE DISTRIBUTOR AS PRINCIPAL UNDERWRITER IN
CONNECTION WITH THE OFFER AND SALE OF THE SHARES. THE DISTRIBUTOR SHALL, AS
AGENT FOR THE FUND, SUBJECT TO APPLICABLE FEDERAL AND STATE LAW AND THE
DECLARATION OF TRUST AND BY-LAWS OF THE FUND AND IN ACCORDANCE WITH THE
REPRESENTATIONS IN THE FUND'S PROSPECTUS, AS SUCH DOCUMENTS MAY BE AMENDED FROM
TIME TO TIME: (A) PROMOTE THE SERIES; (B) ENTER INTO APPROPRIATE DEALER
AGREEMENTS WITH OTHER REGISTERED BROKER-DEALERS TO FURTHER DISTRIBUTION OF THE
SHARES; (C) SOLICIT ORDERS FOR THE PURCHASE OF THE SHARES SUBJECT TO SUCH TERMS
AND CONDITIONS AS THE FUND MAY SPECIFY; (D) TRANSMIT PROMPTLY ORDERS AND
PAYMENTS FOR THE PURCHASE OF SHARES AND ORDERS FOR REDEMPTION OF SHARES TO THE
FUND'S TRANSFER AGENT; AND (E) PROVIDE SERVICES AGREED UPON BY THE FUND TO
SERIES SHAREHOLDERS; PROVIDED, HOWEVER, THAT THE DISTRIBUTOR SHALL SELL NO
SHARES PURSUANT TO THIS AGREEMENT UNTIL THE DISTRIBUTOR IS NOTIFIED THAT THE
FUND'S REGISTRATION STATEMENT UNDER THE 1933 ACT, AUTHORIZING THE SALE OF SUCH
SHARES THROUGH THE DISTRIBUTOR, HAS BEEN DECLARED EFFECTIVE. THE DISTRIBUTOR
SHALL COMPLY WITH ALL APPLICABLE FEDERAL AND STATE LAWS AND OFFER THE SHARES ON
AN AGENCY OR "BEST EFFORTS" BASIS UNDER WHICH THE FUND SHALL ONLY ISSUE SUCH
SHARES AS ARE ACTUALLY SOLD.
2. THE PUBLIC OFFERING PRICE OF THE SHARES SHALL BE THE NET ASSET VALUE
PER SHARE (AS DETERMINED BY THE SERIES) OF THE OUTSTANDING SHARES OF THE
RESPECTIVE SERIES, PLUS THE APPLICABLE SALES CHARGE, IF ANY, AS SET FORTH IN THE
FUND'S THEN CURRENT PROSPECTUS. THE FUND SHALL FURNISH THE DISTRIBUTOR WITH A
STATEMENT OF EACH COMPUTATION OF NET ASSET VALUE AND OF THE DETAILS ENTERING
INTO SUCH COMPUTATION.
3. COMPENSATION.
A. DISTRIBUTION FEE PURSUANT TO RULE 12B-1 DISTRIBUTION PLAN. AS
COMPENSATION FOR THE SERVICES PERFORMED AND THE EXPENSES ASSUMED BY THE
DISTRIBUTOR UNDER THIS AGREEMENT, INCLUDING, BUT NOT LIMITED TO, REMUNERATION TO
THE DISTRIBUTOR'S EMPLOYEES AND TO OTHER BROKER-DEALERS ON THE BASIS OF SALES OF
CLASS A SHARES, THE FUND SHALL PAY THE DISTRIBUTOR A DISTRIBUTION SERVICE FEE OF
0.35% OF THE AVERAGE DAILY NET ASSETS OF THE RESPECTIVE PORTFOLIO. FOR CLASS B
SHARES, THE FUND SHALL PAY THE DISTRIBUTOR A DISTRIBUTION FEE EQUAL TO THE SUM
OF (I) SALES COMMISSIONS ADVANCED TO THE SELLING BROKER FOR THE A CLASS B SHARES
OF THE NON-MONEY MARKET FUND IN WHICH THE SHARES WERE ORIGINALLY INVESTED
("ORIGINAL CLASS B FUND") , (II) 0.50% OF THE AMOUNT RECEIVED BY THE ORIGINAL
CLASS B FUND FOR EACH ORIGINAL CLASS B SHARE SOLD, THAT WAS SUBSEQUENTLY
EXCHANGED, AND REMAINS, IN THE FUND'S CLASS B SHARES, AND (III) INTEREST
CALCULATED BY APPLYING THE RATE OF 1% OVER PRIME TO THE OUTSTANDING BALANCE OF
THE DISTRIBUTOR'S EXCESS COSTS. "EXCESS COSTS" ARE THOSE COSTS INCURRED BY THE
DISTRIBUTOR IN MARKETING THE CLASS B SHARES, SUCH AS COMMISSIONS AND OTHER
PAYMENTS ADVANCED TO SALES PERSONNEL AND THIRD PARTIES AND RELATED INTEREST
COSTS AS PERMITTED BY THE RULES OF THE NATIONAL ASSOCIATION OF SECURITIES
DEALERS, INC. ("NASD"), PRINTING AND MAILING PROSPECTUSES, SALES LITERATURE AND
OTHER RELEVANT MATERIAL TO OTHER THAN CURRENT SHAREHOLDERS, ADVERTISING AND
PUBLIC RELATIONS, TELEMARKETING, MARKETING-RELATED OVERHEAD EXPENSES, AND OTHER
DISTRIBUTION COSTS, THAT EXCEED THE CUMULATIVE CONTINGENT DEFERRED SALES CHARGES
AND DISTRIBUTION FEES THE DISTRIBUTOR HAS RECEIVED FOR THOSE SHARES. SUCH
PAYMENTS HAVE BEEN AUTHORIZED BY THE FUND IN ITS DISTRIBUTION PLAN ADOPTED
PURSUANT TO RULE L2B-L UNDER THE L940 ACT ("DISTRIBUTION PLAN") AND SUCH
PAYMENTS WILL BE LIMITED IN ACCORDANCE WITH THE TERMS OF THE DISTRIBUTION PLAN.
ADDITIONAL PAYMENTS TO THE DISTRIBUTOR FROM THE FUND'S INVESTMENT ADVISER,
CALVERT ASSET MANAGEMENT COMPANY, INC. (THE "ADVISOR"), MAY BE AUTHORIZED IN
ACCORDANCE WITH APPLICABLE LAW.
B. SERVICE FEE PURSUANT TO NASD RULES. AS ADDITIONAL COMPENSATION FOR
CLASS B AND CLASS C SHARES OF EACH SERIES, THE FUND SHALL PAY THE DISTRIBUTOR A
SERVICE FEE (AS THAT TERM IS DEFINED BY THE NASD). OF 0.25% OF THE AVERAGE DAILY
NET ASSETS OF THAT CLASS, RESPECTIVELY.
C. SALES CHARGES. AS ADDITIONAL COMPENSATION FOR THE SERVICES PERFORMED
AND THE EXPENSES ASSUMED BY THE DISTRIBUTOR UNDER THIS AGREEMENT, THE
DISTRIBUTOR MAY, IN STRICT CONFORMITY WITH THE TERMS OF THE THEN CURRENT
PROSPECTUS, IMPOSE AND RETAIN FOR ITS OWN ACCOUNT THE AMOUNT OF THE CONTINGENT
DEFERRED SALES CHARGE, IF ANY, IN ACCORDANCE WITH NASD RULES.
4. AS USED IN THIS AGREEMENT, THE TERM "REGISTRATION STATEMENT" SHALL
MEAN THE REGISTRATION STATEMENT MOST RECENTLY FILED BY THE FUND WITH THE
SECURITIES AND EXCHANGE COMMISSION AND EFFECTIVE UNDER THE L933 ACT, AS SUCH
REGISTRATION STATEMENT IS AMENDED BY ANY AMENDMENTS THERETO AT THE TIME IN
EFFECT, AND THE TERM "PROSPECTUS" SHALL MEAN THE FORM OF PROSPECTUS FILED BY THE
SERIES AS PART OF THE REGISTRATION STATEMENT.
5. THE DISTRIBUTOR SHALL PRINT AND DISTRIBUTE TO PROSPECTIVE INVESTORS
PROSPECTUSES, AND MAY PRINT AND DISTRIBUTE SUCH OTHER SALES LITERATURE, REPORTS,
FORMS, AND ADVERTISEMENTS IN CONNECTION WITH THE SALE OF THE SHARES AS COMPLY
WITH THE APPLICABLE PROVISIONS OF FEDERAL AND STATE LAW. IN CONNECTION WITH
SUCH SALES AND OFFERS OF SALE, THE DISTRIBUTOR SHALL GIVE ONLY SUCH INFORMATION
AND MAKE ONLY SUCH STATEMENTS OR REPRESENTATIONS, AND REQUIRE BROKER-DEALERS
WITH WHOM IT ENTERS INTO DEALER AGREEMENTS TO GIVE ONLY SUCH INFORMATION AND
MAKE ONLY SUCH STATEMENTS OR REPRESENTATIONS, AS ARE CONTAINED IN THE PROSPECTUS
OR IN INFORMATION FURNISHED IN WRITING TO THE DISTRIBUTOR BY THE FUND. THE FUND
SHALL NOT BE RESPONSIBLE IN ANY WAY FOR ANY OTHER INFORMATION, STATEMENTS OR
REPRESENTATIONS GIVEN OR MADE BY THE DISTRIBUTOR, OTHER BROKER-DEALERS, OR THE
REPRESENTATIVES OR AGENTS OF THE DISTRIBUTOR OR SUCH BROKER-DEALERS. EXCEPT AS
SPECIFICALLY PROVIDED IN PARAGRAPH 3 OF THIS AGREEMENT, THE FUND SHALL BEAR NONE
OF THE EXPENSES OF THE DISTRIBUTOR IN CONNECTION WITH ITS OFFER AND SALE OF THE
SHARES.
6. THE FUND AGREES AT ITS OWN EXPENSE TO REGISTER THE SHARES WITH THE
SECURITIES AND EXCHANGE COMMISSION, STATE AND OTHER REGULATORY BODIES, AND TO
PREPARE AND FILE FROM TIME TO TIME SUCH PROSPECTUSES, AMENDMENTS, REPORTS AND
OTHER DOCUMENTS AS MAY BE NECESSARY TO MAINTAIN THE REGISTRATION STATEMENT. THE
FUND SHALL BEAR ALL EXPENSES RELATED TO PREPARING AND TYPESETTING SUCH
PROSPECTUSES AND OTHER MATERIALS REQUIRED BY LAW AND SUCH OTHER EXPENSES,
INCLUDING PRINTING AND MAILING EXPENSES, RELATED TO THE FUND'S COMMUNICATIONS
WITH PERSONS WHO ARE SHAREHOLDERS OF THE FUND.
7. THE FUND AGREES TO INDEMNIFY, DEFEND AND HOLD THE DISTRIBUTOR, ITS
SEVERAL OFFICERS AND DIRECTORS, AND ANY PERSON WHO CONTROLS THE DISTRIBUTOR
WITHIN THE MEANING OF SECTION L5 OF THE L933 ACT, FREE AND HARMLESS FROM AND
AGAINST ANY AND ALL CLAIMS, DEMANDS, LIABILITIES AND EXPENSES (INCLUDING THE
COST OF INVESTIGATING OR DEFENDING SUCH CLAIMS, DEMANDS OR LIABILITIES AND ANY
COUNSEL FEES INCURRED IN CONNECTION THEREWITH) WHICH THE DISTRIBUTOR, ITS
OFFICERS OR DIRECTORS, OR ANY SUCH CONTROLLING PERSON MAY INCUR, UNDER THE L933
ACT OR UNDER COMMON LAW OR OTHERWISE, ARISING OUT OF OR BASED UPON ANY ALLEGED
UNTRUE STATEMENT OF A MATERIAL FACT CONTAINED IN THE REGISTRATION STATEMENT OR
PROSPECTUS OR ARISING OUT OF OR BASED UPON ANY ALLEGED OMISSION TO STATE A
MATERIAL FACT REQUIRED TO BE STATED IN EITHER THEREOF OR NECESSARY TO MAKE THE
STATEMENTS IN EITHER THEREOF NOT MISLEADING, PROVIDED THAT IN NO EVENT SHALL
ANYTHING CONTAINED IN THIS AGREEMENT BE CONSTRUED SO AS TO PROTECT THE
DISTRIBUTOR AGAINST ANY LIABILITY TO THE FUND OR ITS SHAREHOLDERS TO WHICH THE
DISTRIBUTOR WOULD OTHERWISE BE SUBJECT BY REASON OF WILLFUL MISFEASANCE, BAD
FAITH, OR GROSS NEGLIGENCE, IN THE PERFORMANCE OF ITS DUTIES, OR BY REASON OF
ITS RECKLESS DISREGARD OF ITS OBLIGATIONS AND DUTIES UNDER THIS AGREEMENT.
8. THE DISTRIBUTOR AGREES TO INDEMNIFY, DEFEND AND HOLD THE FUND, ITS
SEVERAL OFFICERS AND DIRECTORS, AND ANY PERSON WHO CONTROLS THE FUND WITH THE
MEANING OF SECTION L5 OF THE L933 ACT, FREE AND HARMLESS FROM AND AGAINST ANY
AND ALL CLAIMS, DEMANDS, LIABILITIES AND EXPENSES (INCLUDING THE COST OF
INVESTIGATING OR DEFENDING SUCH CLAIMS, DEMANDS OR LIABILITIES AND ANY COUNSEL
FEES INCURRED IN CONNECTION THEREWITH) WHICH THE FUND, ITS OFFICERS OR
DIRECTORS, OR ANY SUCH CONTROLLING PERSON MAY INCUR, UNDER THE L933 ACT OR UNDER
COMMON LAW OR OTHERWISE, ARISING OUT OF OR BASED UPON ANY ALLEGED UNTRUE
STATEMENT OR A MATERIAL FACT CONTAINED IN INFORMATION FURNISHED IN WRITING BY
THE DISTRIBUTOR TO THE FUND FOR USE IN THE REGISTRATION STATEMENT OR PROSPECTUS
OR ARISING OUT OF OR BASED UPON ANY ALLEGED OMISSION TO STATE A MATERIAL FACT IN
CONNECTION WITH SUCH INFORMATION REQUIRED TO BE STATED IN THE REGISTRATION
STATEMENT OR PROSPECTUS OR NECESSARY TO MAKE SUCH INFORMATION NOT MISLEADING.
9. THE FUND RESERVES THE RIGHT AT ANY TIME TO WITHDRAW ALL OFFERINGS OF
THE SHARES BY WRITTEN NOTICE TO THE DISTRIBUTOR AT ITS PRINCIPAL OFFICE.
10. THE DISTRIBUTOR IS AN INDEPENDENT CONTRACTOR AND SHALL BE AGENT FOR
THE FUND ONLY IN RESPECT TO THE OFFER, SALE AND REDEMPTION OF THE SHARES.
11. THE SERVICES OF THE DISTRIBUTOR TO THE FUND UNDER THIS AGREEMENT
ARE NOT TO BE DEEMED EXCLUSIVE, AND THE DISTRIBUTOR SHALL BE FREE TO RENDER
SIMILAR SERVICES OR OTHER SERVICES TO OTHERS SO LONG AS ITS SERVICES HEREUNDER
ARE NOT IMPAIRED THEREBY.
12. THE DISTRIBUTOR ACKNOWLEDGES THAT IT HAS RECEIVED NOTICE OF AND
ACCEPTS THE LIMITATIONS UPON THE FUND'S LIABILITY SET FORTH IN ARTICLE XI OF ITS
DECLARATION OF TRUST. THE DISTRIBUTOR AGREES THAT THE FUND'S OBLIGATIONS
HEREUNDER IN ANY CASE SHALL BE LIMITED TO THE FUND AND TO ITS ASSETS AND THAT
THE DISTRIBUTOR SHALL NOT SEEK SATISFACTION OF ANY SUCH OBLIGATION FROM THE
SHAREHOLDERS OF THE FUND NOR FROM ANY TRUSTEE, OFFICER, EMPLOYEE OR AGENT OF THE
FUND.
13. THE FUND SHALL NOT USE THE NAME OF THE DISTRIBUTOR IN ANY
PROSPECTUS, SALES LITERATURE OR OTHER MATERIAL RELATING TO THE FUND IN ANY
MANNER NOT APPROVED PRIOR THERETO BY THE DISTRIBUTOR; PROVIDED, HOWEVER, THAT
THE DISTRIBUTOR SHALL APPROVE ALL USES OF ITS NAME WHICH MERELY REFER IN
ACCURATE TERMS TO ITS APPOINTMENT HEREUNDER OR WHICH ARE REQUIRED BY THE SEC OR
A STATE SECURITIES COMMISSION; AND, PROVIDED FURTHER, THAT IN NO EVENT SHALL
SUCH APPROVAL BE UNREASONABLY WITHHELD. THE DISTRIBUTOR SHALL NOT USE THE NAME
OF THE FUND IN ANY MATERIAL RELATING TO THE DISTRIBUTOR IN ANY MANNER NOT
APPROVED PRIOR THERETO BY THE FUND; PROVIDED, HOWEVER, THAT THE FUND SHALL
APPROVE ALL USES OF ITS NAME WHICH MERELY REFER IN ACCURATE TERMS TO THE
APPOINTMENT OF THE DISTRIBUTOR HEREUNDER OR WHICH ARE REQUIRED BY THE SEC OR A
STATE SECURITIES COMMISSION; AND, PROVIDED FURTHER, THAT IN NO EVENT SHALL SUCH
APPROVAL BE UNREASONABLY WITHHELD.
14. THE DISTRIBUTOR SHALL PREPARE WRITTEN REPORTS FOR THE BOARD OF
TRUSTEES OF THE FUND ON A QUARTERLY BASIS SHOWING INFORMATION CONCERNING
SERVICES PROVIDED AND EXPENSES INCURRED WHICH ARE RELATED TO THIS AGREEMENT AND
SUCH OTHER INFORMATION AS FROM TIME TO TIME SHALL BE REASONABLY REQUESTED BY THE
FUND'S BOARD OF TRUSTEES.
15. AS USED IN THIS AGREEMENT, THE TERMS "ASSIGNMENT," "INTERESTED
PERSON," AND "MAJORITY OF THE OUTSTANDING VOTING SECURITIES" SHALL HAVE THE
MEANING GIVEN TO THEM BY SECTION 2(A) OF THE L940 ACT, SUBJECT TO SUCH
EXEMPTIONS AS MAY BE GRANTED BY THE SECURITIES AND EXCHANGE COMMISSION BY ANY
RULE, REGULATION OR ORDER; PROVIDED, HOWEVER, THAT, IN ORDER TO OBTAIN
FINANCING, THE DISTRIBUTOR MAY ASSIGN TO A LENDING INSTITUTION THE PAYMENTS DUE
TO THE DISTRIBUTOR UNDER THIS AGREEMENT WITHOUT IT CONSTITUTING AN ASSIGNMENT OF
THE AGREEMENT
16. SUBJECT TO THE PROVISIONS OF PARAGRAPHS L7 AND L8 BELOW, THIS
AGREEMENT WILL REMAIN IN EFFECT FOR TWO YEARS FROM THE DATE OF ITS EXECUTION AND
FROM YEAR TO YEAR THEREAFTER, PROVIDED THAT THE DISTRIBUTOR DOES NOT NOTIFY THE
FUND IN WRITING AT LEAST SIXTY (60) DAYS PRIOR TO THE EXPIRATION DATE IN ANY
YEAR THAT IT DOES NOT WISH CONTINUANCE OF THE AGREEMENT FOR AN ADDITIONAL YEAR.
17. TERMINATION AND CONTINUED CLASS B PAYMENTS.
A. TERMINATION. THIS AGREEMENT SHALL AUTOMATICALLY TERMINATE IN THE EVENT
OF ITS ASSIGNMENT AND MAY BE TERMINATED AT ANY TIME WITHOUT THE PAYMENT OF ANY
PENALTY BY THE FUND OR BY THE DISTRIBUTOR ON SIXTY (60) DAYS' WRITTEN NOTICE TO
THE OTHER PARTY. THE FUND MAY EFFECT SUCH TERMINATION BY A VOTE OF (I) A
MAJORITY OF THE BOARD OF TRUSTEES OF THE FUND, (II) A MAJORITY OF THE TRUSTEES
WHO ARE NOT INTERESTED PERSONS OF THE FUND, WHO ARE NOT PARTIES TO THIS
AGREEMENT OR INTERESTED PERSONS OF SUCH PARTIES, AND WHO HAVE NO DIRECT OR
INDIRECT FINANCIAL INTEREST IN THE OPERATION OF THE DISTRIBUTION PLAN, IF ANY,
IN THIS AGREEMENT OR IN ANY AGREEMENT RELATED TO THE FUND'S DISTRIBUTION PLAN
(THE "RULE L2B-L TRUSTEES"), OR (III) A MAJORITY OF THE OUTSTANDING VOTING
SECURITIES OF THE SERIES.
B. CONTINUED CLASS B PAYMENTS. IT IS PROVIDED, HOWEVER, THAT THE FUND
ACKNOWLEDGES THAT THE DISTRIBUTOR IS RELYING ON THE CONTINUED PAYMENT OF FEES
FOR CLASS B SHARES TO THE EXTENT ITS EXCESS COSTS AS DEFINED IN SECTION 3(A)
ABOVE HAVE NOT BEEN RECOUPED, AND THE FUND AGREES, THAT IN THE EVENT THE
DISTRIBUTION PLAN OR THIS AGREEMENT IS TERMINATED WITH RESPECT TO ANY FUND, THAT
WITH RESPECT TO CLASS B SHARES SOLD PRIOR TO THE TERMINATION OF THE PLAN OR
AGREEMENT, THE FUND SHALL CONTINUE TO PAY THE DISTRIBUTOR THE CLASS B
DISTRIBUTION FEE, TO THE EXTENT THE DISTRIBUTOR HAS EXCESS COSTS FOR SUCH
SHARES. THIS SECTION 17(B) SHALL SURVIVE ANY TERMINATION OF THIS AGREEMENT.
18. THIS AGREEMENT SHALL BE SUBMITTED FOR RENEWAL TO THE BOARD OF
TRUSTEES OF THE FUND ANNUALLY AND SHALL CONTINUE IN EFFECT ONLY SO LONG AS
SPECIFICALLY APPROVED ANNUALLY (I) BY A MAJORITY VOTE OF THE FUND'S BOARD OF
TRUSTEES, AND (II) BY THE VOTE OF A MAJORITY OF THE RULE L2B-L TRUSTEES, IF ANY,
OF THE FUND, CAST IN PERSON AT A MEETING CALLED FOR THE PURPOSE OF VOTING ON
SUCH APPROVAL.
IN WITNESS WHEREOF, THE PARTIES HERETO HAVE CAUSED THIS AGREEMENT TO BE
EXECUTED ON THE DATE FIRST ABOVE WRITTEN BY THEIR OFFICERS THEREUNTO DULY
AUTHORIZED.
ATTEST: CALVERT CASH RESERVES
BY: BY:
ATTEST: CALVERT DISTRIBUTORS, INC.
BY: BY:
SWB/UW AGRMTS/CCR 4/95
7
CUSTODIAN AGREEMENT
THIS AGREEMENT, DATED AS OF APRIL 1, 1991, IS BETWEEN STATE STREET BANK AND
TRUST COMPANY, A MASSACHUSETTS TRUST COMPANY, HAVING ITS PRINCIPAL PLACE OF
BUSINESS AT 225 FRANKLIN STREET, BOSTON, MASSACHUSETTS, 02110 ("STATE STREET" OR
THE "CUSTODIAN"), AND [FUND], ON BEHALF OF [PORTFOLIO], HAVING ITS PRINCIPAL
PLACE OF BUSINESS AT 4550 MONTGOMERY AVENUE, SUITE 1000N, BETHESDA, MARYLAND,
20814. IN CONSIDERATION OF THE MUTUAL COVENANTS AND AGREEMENTS CONTAINED IN
THIS AGREEMENT, THE PARTIES AGREE AS FOLLOWS:
1. EMPLOYMENT OF CUSTODIAN AND PROPERTY TO BE HELD BY IT
THE PORTFOLIO HEREBY EMPLOYS STATE STREET AS THE CUSTODIAN OF ITS ASSETS,
INCLUDING SECURITIES. THE PORTFOLIO AGREES TO DELIVER TO THE CUSTODIAN ALL
SECURITIES AND CASH NOW OR HEREAFTER OWNED OR ACQUIRED, AND ALL PAYMENTS OF
INCOME, PAYMENTS OF PRINCIPAL OR CAPITAL DISTRIBUTIONS RECEIVED BY IT ON
SECURITIES OWNED BY THE PORTFOLIO AT ANY GIVEN TIME, AND THE CASH CONSIDERATION
RECEIVED BY IT FOR SHARES OF THE PORTFOLIO. THE CUSTODIAN WILL NOT BE
RESPONSIBLE FOR ANY PROPERTY OF THE PORTFOLIO HELD OR RECEIVED BY THE PORTFOLIO
AND NOT DELIVERED TO THE CUSTODIAN.
UPON RECEIPT OF "PROPER INSTRUCTIONS" (AS DEFINED IN SECTION 4), THE
CUSTODIAN WILL EMPLOY ONE OR MORE SUBCUSTODIANS LOCATED IN THE UNITED STATES,
BUT ONLY IN ACCORDANCE WITH AN APPLICABLE VOTE BY THE BOARD OF
DIRECTORS/TRUSTEES OF THE FUND, AND PROVIDED THAT THE CUSTODIAN WILL HAVE NO
MORE OR LESS RESPONSIBILITY OR LIABILITY TO THE PORTFOLIO ON ACCOUNT OF ANY
ACTIONS OR OMISSIONS OF ANY SUB-CUSTODIAN SO EMPLOYED THAN ANY SUCH
SUB-CUSTODIAN HAS TO THE CUSTODIAN, AND FURTHER PROVIDED THAT THE CUSTODIAN WILL
NOT RELEASE THE SUB-CUSTODIAN FROM ANY RESPONSIBILITY OR LIABILITY UNLESS
MUTUALLY AGREED UPON BY THE PARTIES IN WRITING.
2. DUTIES OF THE CUSTODIAN WITH RESPECT TO PROPERTY OF THE PORTFOLIO
2.1 HOLDING SECURITIES. THE CUSTODIAN WILL HOLD AND PHYSICALLY SEGREGATE
FOR THE ACCOUNT OF THE PORTFOLIO ALL NON-CASH PROPERTY OTHER THAN (A) SECURITIES
MAINTAINED IN A CLEARING AGENCY ACTING AS A SECURITIES DEPOSITORY OR IN A
BOOK-ENTRY SYSTEM AUTHORIZED BY THE U.S. DEPARTMENT OF THE TREASURY
(COLLECTIVELY REFERRED TO AS "SECURITIES SYSTEM;" SEE SECTION 2.10), AND (B)
COMMERCIAL PAPER OF AN ISSUER FOR WHICH THE CUSTODIAN ACTS AS ISSUING AND PAYING
AGENT ("DIRECT PAPER") WHICH IS DEPOSITED AND/OR MAINTAINED IN THE DIRECT PAPER
SYSTEM OF THE CUSTODIAN (SEE SECTION 2.11).
2.2 DELIVERY OF SECURITIES. THE CUSTODIAN WILL RELEASE AND DELIVER
PORTFOLIO SECURITIES HELD BY THE CUSTODIAN OR IN A SECURITIES SYSTEM ACCOUNT OF
THE CUSTODIAN OR IN THE CUSTODIAN'S DIRECT PAPER BOOK ENTRY SYSTEM ACCOUNT
("DIRECT PAPER SYSTEM ACCOUNT") ONLY UPON RECEIPT OF PROPER INSTRUCTIONS, WHICH
MAY BE CONTINUING INSTRUCTIONS WHEN DEEMED APPROPRIATE BY MUTUAL AGREEMENT OF
THE PARTIES, AND ONLY IN THE FOLLOWING CASES:
L) SALE. UPON THE SALE OF AND RECEIPT OF PAYMENT FOR PORTFOLIO SECURITIES;
2) SECURITIES SYSTEM. IN THE CASE OF A SALE EFFECTED THROUGH A SECURITIES
SYSTEM, IN ACCORDANCE WITH THE PROVISIONS OF SECTION 2.10;
3) TENDER OFFER. TO THE DEPOSITORY AGENT OR OTHER RECEIVING AGENT IN
CONNECTION WITH TENDER OR OTHER SIMILAR OFFERS FOR THE PORTFOLIO'S SECURITIES;
4) REDEMPTION BY ISSUER. TO THE ISSUER OR ITS AGENT WHEN PORTFOLIO
SECURITIES ARE CALLED, REDEEMED, RETIRED OR OTHERWISE BECOME PAYABLE; PROVIDED
THAT, IN ANY SUCH CASE, THE CASH OR OTHER CONSIDERATION IS TO BE DELIVERED TO
THE CUSTODIAN;
5) TRANSFER TO ISSUER, NOMINEE; EXCHANGE. TO THE ISSUER OR ITS AGENT FOR
TRANSFER INTO THE NAME OF THE PORTFOLIO OR INTO THE NAME OF ANY NOMINEE OR
NOMINEES OF THE CUSTODIAN OR INTO THE NAME OR NOMINEE NAME OF ANY AGENT
APPOINTED PURSUANT TO THIS AGREEMENT OR INTO THE NAME OR NOMINEE NAME OF ANY
SUB-CUSTODIAN APPOINTED PURSUANT TO SECTION L; OR FOR EXCHANGE FOR A DIFFERENT
NUMBER OF BONDS, CERTIFICATES OR OTHER EVIDENCE REPRESENTING THE SAME AGGREGATE
FACE AMOUNT OR NUMBER OF UNITS AND BEARING THE SAME INTEREST RATE, MATURITY DATE
AND CALL PROVISIONS, IF ANY; PROVIDED THAT, IN ANY SUCH CASE, THE NEW SECURITIES
ARE TO BE DELIVERED TO THE CUSTODIAN;
6) SALE TO BROKER OR DEALER. UPON THE SALE OF PORTFOLIO SECURITIES TO THE
BROKER OR ITS CLEARING AGENT OR DEALER, AGAINST A RECEIPT, FOR EXAMINATION IN
ACCORDANCE WITH "STREET DELIVERY" CUSTOM; PROVIDED THAT THE CUSTODIAN WILL HAVE
NO RESPONSIBILITY OR LIABILITY FOR ANY LOSS ARISING FROM THE DELIVERY OF SUCH
SECURITIES PRIOR TO RECEIVING PAYMENT FOR SUCH SECURITIES EXCEPT AS MAY ARISE
FROM THE CUSTODIAN'S FAILURE TO ACT IN ACCORDANCE WITH ITS DUTIES AS SET FORTH
IN THIS AGREEMENT.
7) EXCHANGE OR CONVERSION. FOR EXCHANGE OR CONVERSION PURSUANT TO ANY PLAN
OF MERGER, CONSOLIDATION, RECAPITALIZATION, REORGANIZATION, SPLIT-UP OF SHARES,
CHANGE OF PAR VALUE OR READJUSTMENT OF THE SECURITIES OF THE ISSUER OF SUCH
SECURITIES, OR PURSUANT TO PROVISIONS FOR CONVERSION CONTAINED IN SUCH
SECURITIES, OR PURSUANT TO ANY DEPOSIT AGREEMENT PROVIDED THAT, IN ANY SUCH
CASE, THE NEW SECURITIES AND CASH, IF ANY, ARE TO BE DELIVERED TO THE CUSTODIAN;
8) WARRANTS, RIGHTS. IN THE CASE OF WARRANTS, RIGHTS OR SIMILAR SECURITIES,
THE SURRENDER THEREOF IN THE EXERCISE OF SUCH WARRANTS, RIGHTS OR SIMILAR
SECURITIES OR THE SURRENDER OF INTERIM RECEIPTS OR TEMPORARY SECURITIES FOR
DEFINITIVE SECURITIES; PROVIDED THAT, IN ANY SUCH CASE, THE NEW SECURITIES AND
CASH, IF ANY, ARE TO BE DELIVERED TO THE CUSTODIAN;
9) LOANS OF SECURITIES. FOR DELIVERY IN CONNECTION WITH ANY LOANS OF
SECURITIES MADE BY THE PORTFOLIO, MADE ONLY AGAINST RECEIPT OF ADEQUATE
COLLATERAL AS AGREED ON FROM TIME TO TIME BY THE CUSTODIAN AND THE PORTFOLIO.
LOANS MAY BE IN THE FORM OF CASH, OBLIGATIONS ISSUED BY THE UNITED STATES
GOVERNMENT, ITS AGENCIES OR INSTRUMENTALITIES, OR SUCH OTHER PROPERTY AS
MUTUALLY AGREED BY THE PARTIES, EXCEPT THAT IN CONNECTION WITH ANY LOANS FOR
WHICH COLLATERAL IS TO BE CREDITED TO THE CUSTODIAN'S ACCOUNT IN THE BOOK-ENTRY
SYSTEM AUTHORIZED BY THE U.S. DEPARTMENT OF THE TREASURY, THE CUSTODIAN WILL NOT
BE HELD LIABLE OR RESPONSIBLE FOR THE DELIVERY OF SECURITIES OWNED BY THE
PORTFOLIO PRIOR TO THE RECEIPT OF SUCH COLLATERAL, UNLESS THE CUSTODIAN FAILS TO
ACT IN ACCORDANCE WITH ITS DUTIES SET FORTH IN THIS AGREEMENT;
10) BORROWINGS. FOR DELIVERY AS SECURITY IN CONNECTION WITH ANY BORROWINGS
BY THE PORTFOLIO REQUIRING A PLEDGE OF ASSETS BY THE PORTFOLIO, MADE ONLY
AGAINST RECEIPT OF AMOUNTS BORROWED; EXCEPT, WHERE ADDITIONAL COLLATERAL IS
REQUIRED TO SECURE A BORROWING ALREADY MADE, FURTHER SECURITIES MAY BE RELEASED
FOR THAT PURPOSE, SUBJECT TO PROPER INSTRUCTIONS;
11) OPTIONS. FOR DELIVERY IN ACCORDANCE WITH THE PROVISIONS OF ANY
AGREEMENT AMONG THE PORTFOLIO, THE CUSTODIAN AND A BROKER-DEALER REGISTERED
UNDER THE SECURITIES EXCHANGE ACT OF 1934 (THE "EXCHANGE ACT") AND A MEMBER OF
THE NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC. ("NASD"), RELATING TO
COMPLIANCE WITH THE RULES OF THE OPTIONS CLEARING CORPORATION, ANY REGISTERED
NATIONAL SECURITIES EXCHANGE, ANY SIMILAR ORGANIZATION OR ORGANIZATIONS, OR THE
INVESTMENT COMPANY ACT OF 1940, REGARDING ESCROW OR OTHER ARRANGEMENTS IN
CONNECTION WITH TRANSACTIONS BY THE PORTFOLIO;
12) FUTURES. FOR DELIVERY IN ACCORDANCE WITH THE PROVISIONS OF ANY
AGREEMENT AMONG THE PORTFOLIO, THE CUSTODIAN, AND A FUTURES COMMISSION MERCHANT
REGISTERED UNDER THE COMMODITY EXCHANGE ACT, RELATING TO COMPLIANCE WITH THE
RULES OF THE COMMODITY FUTURES TRADING COMMISSION AND/OR ANY CONTRACT MARKET,
ANY SIMILAR ORGANIZATION OR ORGANIZATIONS, OR THE INVESTMENT COMPANY ACT OF
1940, REGARDING ACCOUNT DEPOSITS IN CONNECTION WITH TRANSACTIONS BY THE
PORTFOLIO;
13) IN-KIND DISTRIBUTIONS. UPON RECEIPT OF INSTRUCTIONS FROM THE
PORTFOLIO'S TRANSFER AGENT, FOR DELIVERY TO THE TRANSFER AGENT OR TO THE HOLDERS
OF SHARES IN CONNECTION WITH DISTRIBUTIONS IN KIND, AS MAY BE DESCRIBED FROM
TIME TO TIME IN THE PORTFOLIO'S CURRENTLY EFFECTIVE PROSPECTUS AND STATEMENT OF
ADDITIONAL INFORMATION, IN SATISFACTION OF SHAREHOLDER REQUESTS FOR REPURCHASE
OR REDEMPTION;
14) MISCELLANEOUS. FOR ANY OTHER PROPER CORPORATE PURPOSE, MADE ONLY UPON
RECEIPT OF A CERTIFIED COPY OF A RESOLUTION OF THE BOARD OF TRUSTEES SIGNED BY
AN OFFICER OF THE FUND AND CERTIFIED BY THE SECRETARY OR AN ASSISTANT SECRETARY,
SPECIFYING THE SECURITIES TO BE DELIVERED, SETTING FORTH THE PURPOSE FOR WHICH
SUCH DELIVERY IS TO BE MADE, DECLARING SUCH PURPOSE TO BE A PROPER CORPORATE
PURPOSE, AND NAMING THE PERSON OR PERSONS TO WHOM DELIVERY OF THE SECURITIES
WILL BE MADE.
IN ALL CASES, PAYMENTS TO THE PORTFOLIO WILL BE MADE IN CASH, BY A
CERTIFIED CHECK OR A TREASURER'S OR CASHIER'S CHECK OF A BANK, BY EFFECTIVE BANK
WIRE TRANSFER THROUGH THE FEDERAL RESERVE WIRE SYSTEM OR, IF APPROPRIATE,
OUTSIDE OF THE FEDERAL RESERVE WIRE SYSTEM AND SUBSEQUENT CREDIT TO THE
PORTFOLIO'S CUSTODIAN ACCOUNT, OR, IN CASE OF DELIVERY THROUGH A STOCK CLEARING
COMPANY, BY BOOK-ENTRY CREDIT BY THE STOCK CLEARING COMPANY IN ACCORDANCE WITH
THE THEN CURRENT STREET CUSTOM, OR SUCH OTHER FORM OF PAYMENT AS MAY BE MUTUALLY
AGREED ON BY THE PARTIES, IN ALL SUCH CASES COLLECTED FUNDS TO BE PROMPTLY
CREDITED TO THE PORTFOLIO.
2.3 REGISTRATION OF SECURITIES. SECURITIES HELD BY THE CUSTODIAN (OTHER
THAN BEARER SECURITIES) WILL BE REGISTERED (A) IN THE NAME OF THE PORTFOLIO OR
(B) IN THE NAME OF ANY NOMINEE OF THE PORTFOLIO OR OF ANY NOMINEE OF THE
CUSTODIAN ASSIGNED EXCLUSIVELY TO THE PORTFOLIO, UNLESS THE PORTFOLIO HAS
AUTHORIZED IN WRITING THE APPOINTMENT OF A NOMINEE TO BE USED IN COMMON WITH
OTHER REGISTERED INVESTMENT COMPANIES HAVING THE SAME INVESTMENT ADVISER AS THE
PORTFOLIO, OR IN THE NAME OR NOMINEE NAME OF ANY AGENT APPOINTED PURSUANT TO
SECTION 2.9 OR IN THE NAME OR NOMINEE NAME OF ANY SUB-CUSTODIAN APPOINTED
PURSUANT TO SECTION 1. ALL SECURITIES ACCEPTED BY THE CUSTODIAN ON BEHALF OF THE
PORTFOLIO UNDER THE TERMS OF THIS AGREEMENT WILL BE IN "STREET NAME" OR OTHER
GOOD DELIVERY FORM.
2.4 BANK ACCOUNTS. THE CUSTODIAN WILL OPEN AND MAINTAIN A SEPARATE BANK
ACCOUNT OR ACCOUNTS IN THE NAME OF THE PORTFOLIO, SUBJECT ONLY TO DRAFT OR ORDER
BY THE CUSTODIAN ACTING PURSUANT TO THE TERMS OF THIS AGREEMENT. THE CUSTODIAN
WILL HOLD IN THE ACCOUNT(S), IN ACCORDANCE WITH THE PROVISIONS OF THIS
AGREEMENT, ALL CASH RECEIVED BY IT FROM OR FOR THE ACCOUNT OF THE PORTFOLIO,
OTHER THAN CASH MAINTAINED BY THE PORTFOLIO IN A BANK ACCOUNT ESTABLISHED AND
USED IN ACCORDANCE WITH RULE 17F-3 UNDER THE INVESTMENT COMPANY ACT OF 1940.
FUNDS HELD BY THE CUSTODIAN FOR THE PORTFOLIO MAY BE DEPOSITED FOR THE
PORTFOLIO'S CREDIT IN THE BANK AFFILIATE OF THE CUSTODIAN OR IN SUCH OTHER BANKS
OR TRUST COMPANIES AS THE CUSTODIAN MAY IN ITS DISCRETION DEEM NECESSARY OR
DESIRABLE; PROVIDED, HOWEVER, THAT EVERY SUCH BANK OR TRUST COMPANY MUST BE
QUALIFIED TO ACT AS A CUSTODIAN UNDER THE INVESTMENT COMPANY ACT OF 1940. FUNDS
WILL BE DEPOSITED BY THE CUSTODIAN IN ITS CAPACITY AS CUSTODIAN AND WILL BE
WITHDRAWABLE BY THE CUSTODIAN ONLY IN THAT CAPACITY.
2.5 SALE OF SHARES AND AVAILABILITY OF FEDERAL FUNDS. UPON MUTUAL AGREEMENT
BETWEEN THE PORTFOLIO AND THE CUSTODIAN, THE CUSTODIAN WILL, UPON THE RECEIPT OF
PROPER INSTRUCTIONS, MAKE FEDERAL FUNDS AVAILABLE TO THE PORTFOLIO AS OF
SPECIFIED TIMES AGREED UPON FROM TIME TO TIME BY THE PORTFOLIO AND THE CUSTODIAN
IN THE AMOUNT OF CHECKS RECEIVED IN PAYMENT FOR SHARES OF THE PORTFOLIO WHICH
ARE DEPOSITED INTO THE PORTFOLIO'S ACCOUNT.
2.6 COLLECTION OF INCOME, DIVIDENDS. THE CUSTODIAN WILL COLLECT ON A TIMELY
BASIS ALL INCOME AND OTHER PAYMENTS WITH RESPECT TO REGISTERED SECURITIES HELD
TO WHICH THE PORTFOLIO IS ENTITLED EITHER BY LAW OR PURSUANT TO CUSTOM IN THE
SECURITIES BUSINESS. THE CUSTODIAN WILL ALSO COLLECT ON A TIMELY BASIS ALL
INCOME AND OTHER PAYMENTS WITH RESPECT TO BEARER SECURITIES IF, ON THE DATE OF
PAYMENT BY THE ISSUER, THE SECURITIES ARE HELD BY THE CUSTODIAN OR ITS AGENT.
THE CUSTODIAN WILL CREDIT ALL SUCH INCOME OR OTHER PAYMENTS, AS COLLECTED, TO
THE PORTFOLIO'S CUSTODIAN ACCOUNT. WITHOUT LIMITING THE GENERALITY OF THE
FOREGOING, THE CUSTODIAN WILL DETACH AND PRESENT FOR PAYMENT ALL COUPONS AND
OTHER INCOME ITEMS REQUIRING PRESENTATION AS AND WHEN THEY BECOME DUE AND WILL
COLLECT INTEREST WHEN DUE ON SECURITIES HELD PURSUANT TO THIS AGREEMENT. THE
CUSTODIAN WILL ALSO RECEIVE AND COLLECT ALL STOCK DIVIDENDS, RIGHTS AND OTHER
ITEMS OF LIKE NATURE AS AND WHEN THEY BECOME DUE OR PAYABLE. INCOME DUE THE
PORTFOLIO ON SECURITIES LOANED PURSUANT TO THE PROVISIONS OF SECTION 2.2(10)
WILL BE THE RESPONSIBILITY OF THE PORTFOLIO; THE CUSTODIAN WILL HAVE NO DUTY OR
RESPONSIBILITY IN CONNECTION WITH LOANED SECURITIES OTHER THAN TO PROVIDE THE
PORTFOLIO WITH SUCH INFORMATION OR DATA AS MAY BE NECESSARY TO ASSIST THE
PORTFOLIO IN ARRANGING FOR THE TIMELY DELIVERY TO THE CUSTODIAN OF THE INCOME TO
WHICH THE PORTFOLIO IS PROPERLY ENTITLED.
2.7 PAYMENT OF PORTFOLIO MONIES. UPON RECEIPT OF PROPER INSTRUCTIONS, WHICH
MAY BE CONTINUING INSTRUCTIONS WHEN DEEMED APPROPRIATE BY MUTUAL AGREEMENT OF
THE PARTIES, THE CUSTODIAN WILL PAY OUT MONIES OF THE PORTFOLIO IN THE FOLLOWING
CASES ONLY:
L) PURCHASES. UPON THE PURCHASE OF DOMESTIC SECURITIES, OPTIONS, FUTURES
CONTRACTS OR OPTIONS ON FUTURES CONTRACTS FOR THE ACCOUNT OF THE PORTFOLIO BUT
ONLY (A) AGAINST THE DELIVERY OF SUCH SECURITIES, OR EVIDENCE OF TITLE TO SUCH
OPTIONS, FUTURES CONTRACTS OR OPTIONS ON FUTURES CONTRACTS, TO THE CUSTODIAN (OR
ANY BANK, BANKING FIRM OR TRUST COMPANY DOING BUSINESS IN THE UNITED STATES OR
ABROAD WHICH IS QUALIFIED UNDER THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED,
TO ACT AS A CUSTODIAN AND HAS BEEN DESIGNATED BY THE CUSTODIAN AS ITS AGENT FOR
THIS PURPOSE IN ACCORDANCE WITH SECTION 2.9 OF THIS AGREEMENT) REGISTERED IN THE
NAME OF THE PORTFOLIO OR IN THE NAME OF A NOMINEE OF THE PORTFOLIO OR OF THE
CUSTODIAN REFERRED TO IN SECTION 2.3 OF THIS AGREEMENT, OR IN OTHER PROPER FORM
FOR TRANSFER; (B) IN THE CASE OF A PURCHASE EFFECTED THROUGH A SECURITIES
SYSTEM, IN ACCORDANCE WITH THE CONDITIONS SET FORTH IN SECTION 2.10 OF THIS
AGREEMENT; (C) IN THE CASE OF A PURCHASE INVOLVING THE DIRECT PAPER SYSTEM, IN
ACCORDANCE WITH THE CONDITIONS SET FORTH IN SECTION 2.11; OR (D) IN THE CASE OF
REPURCHASE AGREEMENTS ENTERED INTO BETWEEN THE PORTFOLIO AND THE CUSTODIAN, OR
ANOTHER BANK, OR A BROKER-DEALER WHICH IS A MEMBER OF NASD, (I) AGAINST DELIVERY
OF THE SECURITIES EITHER IN CERTIFICATE FORM OR THROUGH AN ENTRY CREDITING THE
CUSTODIAN'S ACCOUNT AT THE FEDERAL RESERVE BANK WITH SUCH SECURITIES OR (II)
AGAINST DELIVERY OF THE RECEIPT EVIDENCING PURCHASE BY THE PORTFOLIO OF
SECURITIES OWNED BY THE CUSTODIAN ALONG WITH WRITTEN EVIDENCE OF THE AGREEMENT
BY THE CUSTODIAN TO REPURCHASE SUCH SECURITIES FROM THE PORTFOLIO. ALL COUPON
BONDS ACCEPTED BY THE CUSTODIAN MUST HAVE THE COUPONS ATTACHED OR MUST BE
ACCOMPANIED BY A CHECK PAYABLE ON COUPON PAYABLE DATE FOR THE INTEREST DUE ON
THAT DATE.
2) EXCHANGES. IN CONNECTION WITH CONVERSION, EXCHANGE OR SURRENDER OF
SECURITIES OWNED BY THE PORTFOLIO AS SET FORTH IN SECTION 2.2 HEREOF;
3) REDEMPTIONS. FOR THE REDEMPTION OR REPURCHASE OF SHARES ISSUED BY THE
PORTFOLIO AS SET FORTH IN THIS AGREEMENT;
4) EXPENSE AND LIABILITY. FOR THE PAYMENT OF ANY EXPENSE OR LIABILITY
INCURRED BY THE PORTFOLIO, INCLUDING BUT NOT LIMITED TO THE FOLLOWING PAYMENTS
FOR THE ACCOUNT OF THE PORTFOLIO: INTEREST, TAXES, MANAGEMENT, ACCOUNTING,
TRANSFER AGENT AND LEGAL FEES, AND OPERATING EXPENSES OF THE PORTFOLIO WHETHER
OR NOT SUCH EXPENSES ARE TO BE IN WHOLE OR PART CAPITALIZED OR TREATED AS
DEFERRED EXPENSES;
5) DIVIDENDS. FOR THE PAYMENT OF ANY DIVIDENDS OR OTHER DISTRIBUTIONS TO
SHAREHOLDERS DECLARED BY THE PORTFOLIO;
6) SHORT SALE DIVIDEND. FOR PAYMENT OF THE AMOUNT OF DIVIDENDS RECEIVED IN
RESPECT OF SECURITIES SOLD SHORT;
7) LOAN. FOR REPAYMENT OF A LOAN UPON REDELIVERY OF PLEDGED SECURITIES AND
UPON SURRENDER OF THE NOTE(S), IF ANY, EVIDENCING THE LOAN;
8) MISCELLANEOUS. FOR ANY OTHER PROPER PURPOSE UPON RECEIPT OF A CERTIFIED
COPY OF A RESOLUTION OF THE BOARD OF TRUSTEES SIGNED BY AN OFFICER OF THE FUND
AND CERTIFIED BY ITS SECRETARY OR AN ASSISTANT SECRETARY, SPECIFYING THE AMOUNT
OF SUCH PAYMENT, SETTING FORTH THE PURPOSE FOR WHICH SUCH PAYMENT IS TO BE MADE,
DECLARING SUCH PURPOSE TO BE A PROPER PURPOSE, AND NAMING THE PERSON OR PERSONS
TO WHOM SUCH PAYMENT IS TO BE MADE.
2.8 LIABILITY FOR PAYMENT IN ADVANCE OF RECEIPT OF SECURITIES PURCHASED.
WHERE PAYMENT FOR PORTFOLIO SECURITIES IS MADE BY THE CUSTODIAN IN ADVANCE OF
RECEIPT OF THE SECURITIES PURCHASED IN THE ABSENCE OF SPECIFIC WRITTEN
INSTRUCTIONS FROM THE PORTFOLIO TO SO PAY IN ADVANCE, THE CUSTODIAN WILL BE
ABSOLUTELY LIABLE TO THE PORTFOLIO FOR SUCH SECURITIES TO THE SAME EXTENT AS IF
THE SECURITIES HAD BEEN RECEIVED BY THE CUSTODIAN.
2.9 APPOINTMENT OF AGENTS. AT ITS DISCRETION, THE CUSTODIAN MAY AT ANY TIME
APPOINT (AND MAY AT ANY TIME REMOVE) ANY OTHER BANK OR TRUST COMPANY QUALIFIED
TO ACT AS A CUSTODIAN UNDER THE INVESTMENT COMPANY ACT OF 1940 AS ITS AGENT TO
CARRY OUT SUCH OF THE PROVISIONS OF THIS SECTION 2 AS THE CUSTODIAN MAY FROM
TIME TO TIME DIRECT; PROVIDED, HOWEVER, THAT THE APPOINTMENT OF ANY AGENT WILL
NOT RELIEVE THE CUSTODIAN OF ITS RESPONSIBILITIES OR LIABILITIES UNDER THIS
AGREEMENT.
2.10 DEPOSIT OF SECURITIES IN SECURITIES SYSTEMS. THE CUSTODIAN MAY DEPOSIT
AND/OR MAINTAIN PORTFOLIO SECURITIES IN A SECURITIES SYSTEM IN ACCORDANCE WITH
APPLICABLE FEDERAL RESERVE BOARD AND SECURITIES AND EXCHANGE COMMISSION RULES
AND REGULATIONS, IF ANY, AND SUBJECT TO THE FOLLOWING PROVISIONS:
L) ACCOUNT OF CUSTODIAN. THE CUSTODIAN MAY KEEP PORTFOLIO SECURITIES IN A
SECURITIES SYSTEM PROVIDED THAT SUCH SECURITIES ARE REPRESENTED IN AN ACCOUNT OF
THE CUSTODIAN IN THE SECURITIES SYSTEM THAT DOES NOT INCLUDE ANY ASSETS OF THE
CUSTODIAN OTHER THAN ASSETS HELD AS A FIDUCIARY, CUSTODIAN OR OTHERWISE FOR
CUSTOMERS;
2) RECORDS. THE CUSTODIAN'S REOCRDS, WITH RESPECT TO PORTFOLIO SECURITIES
MAINTAINED IN A SECURITIES SYSTEM, MUST IDENTIFY BY BOOK ENTRY THOSE SECURITIES
BELONGING TO THE PORTFOLIO;
3) PAYMENT/DELIVERY.
(A) SUBJECT TO SECTION 2.7 (PAYMENT OF PORTFOLIO MONIES), THE CUSTODIAN WILL
PAY FOR PORTFOLIO SECURITIES UPON (I) RECEIPT OF ADVICE FROM THE SECURITIES
SYSTEM THAT SUCH SECURITIES HAVE BEEN TRANSFERRED TO THE ACCOUNT, AND (II) THE
MAKING OF AN ENTRY ON THE RECORDS OF THE CUSTODIAN TO REFLECT SUCH PAYMENT AND
TRANSFER FOR THE ACCOUNT OF THE PORTFOLIO.
(B) SUBJECT TO SECTION 2.2 (DELIVERY OF SECURITIES), THE CUSTODIAN WILL
TRANSFER PORTFOLIO SECURITIES UPON (I) RECEIPT OF ADVICE FROM THE SECURITIES
SYSTEM THAT PAYMENT FOR SUCH SECURITIES HAS BEEN TRANSFERRED TO THE CUSTODIAN'S
ACCOUNT, AND (II) THE MAKING OF AN ENTRY ON THE RECORDS OF THE CUSTODIAN TO
REFLECT SUCH TRANSFER AND PAYMENT FOR THE ACCOUNT OF THE PORTFOLIO.
(C) COPIES OF ALL ADVICES FROM THE SECURITIES SYSTEM OF TRANSFERS OF
PORTFOLIO SECURITIES WILL IDENTIFY THE PORTFOLIO, BE MAINTAINED FOR THE
PORTFOLIO BY THE CUSTODIAN AND BE PROVIDED TO THE PORTFOLIO AT ITS REQUEST. THE
CUSTODIAN WILL FURNISH DAILY TRANSACTION SHEETS REFLECTING EACH DAY'S
TRANSACTIONS IN THE SECURITIES SYSTEM FOR THE ACCOUNT OF THE PORTFOLIO;
4) REPORTS. THE CUSTODIAN WILL PROVIDE THE PORTFOLIO WITH ANY REPORT
OBTAINED BY THE CUSTODIAN ON THE SECURITIES SYSTEM'S ACCOUNTING SYSTEM, INTERNAL
ACCOUNTING CONTROL AND PROCEDURES FOR SAFEGUARDING SECURITIES DEPOSITED IN THE
SECURITIES SYSTEM, AND FURTHER AGREES TO PROVIDE THE PORTFOLIO WITH COPIES OF
ANY DOCUMENTATION IT HAS RELATING TO ITS ARRANGEMENTS WITH THE SECURITIES
SYSTEMS AS SET FORTH IN THIS AGREEMENT OR AS OTHERWISE REQUIRED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY OTHER REGULATORY AGENCY OR
ORGANIZATION;
5) INDEMNIFICATION. ANYTHING TO THE CONTRARY IN THIS AGREEMENT
NOTWITHSTANDING, THE CUSTODIAN WILL BE LIABLE TO THE PORTFOLIO FOR ANY LOSS OR
EXPENSE, INCLUDING REASONABLE ATTORNEYS FEES, OR DAMAGE TO THE PORTFOLIO
RESULTING FROM USE OF THE SECURITIES SYSTEM BY REASON OF ANY FAILURE BY THE
CUSTODIAN, ITS AGENTS, OR ANY EMPLOYEE OR AGENT OF THE CUSTODIAN OR AGENT, OR
FROM FAILURE OF THE CUSTODIAN OR ANY SUCH AGENT TO ENFORCE EFFECTIVELY SUCH
RIGHTS AS IT MAY HAVE AGAINST THE SECURITIES SYSTEM; AT THE ELECTION OF THE
PORTFOLIO, IT WILL BE ENTITLED TO BE SUBROGATED TO THE RIGHTS OF THE CUSTODIAN
WITH RESPECT TO ANY CLAIM AGAINST THE SECURITIES SYSTEM OR ANY OTHER PERSON
WHICH THE CUSTODIAN MAY HAVE AS ACONSEQUENCE OF ANY SUCH LOSS, EXPENSE OR DAMAGE
IF AND TO THE EXTENT THAT THE PORTFOLIO HAS NOT BEEN MADE WHOLE FOR ANY SUCH
LOSS, EXPENSE OR DAMAGE.
2.11 PORTFOLIO ASSETS HELD IN THE CUSTODIAN'S DIRECT PAPER SYSTEM. THE
CUSTODIAN MAY DEPOSIT AND/OR MAINTAIN SECURITIES OWNED BY THE PORTFOLIO IN THE
DIRECT PAPER SYSTEM OF THE CUSTODIAN SUBJECT TO THE FOLLOWING PROVISIONS:
L) NO TRANSACTION RELATING TO SECURITIES IN THE DIRECT PAPER SYSTEM WILL BE
EFFECTED IN THE ABSENCE OF PROPER INSTRUCTIONS;
2) THE CUSTODIAN MAY KEEP SECURITIES OF THE PORTFOLIO IN THE DIRECT PAPER
SYSTEM ONLY IF SUCH SECURITIES ARE REPRESENTED IN AN ACCOUNT OF THE CUSTODIAN IN
THE DIRECT PAPER SYSTEM THAT DOES NOT INCLUDE ANY ASSETS OF THE CUSTODIAN OTHER
THAN ASSETS HELD AS A FIDUCIARY, CUSTODIAN OR OTHERWISE FOR CUSTOMERS;
3) THE RECORDS OF THE CUSTODIAN WITH RESPECT TO SECURITIES OF THE PORTFOLIO
THAT ARE MAINTAINED IN THE DIRECT PAPER SYSTEM WILL IDENTIFY BY BOOK ENTRY THOSE
SECURITIES BELONGING TO THE PORTFOLIO;
4) THE CUSTODIAN WILL PAY FOR SECURITIES PURCHASED FOR THE ACCOUNT OF THE
PORTFOLIO UPON THE MAKING OF AN ENTRY ON THE RECORDS OF THE CUSTODIAN TO REFLECT
SUCH PAYMENT AND TRANSFER OF SECURITIES TO THE ACCOUNT OF THE PORTFOLIO. THE
CUSTODIAN WILL TRANSFER SECURITIES SOLD FOR THE ACCOUNT OF THE PORTFOLIO UPON
THE MAKING OF AN ENTRY ON THE RECORDS OF THE CUSTODIAN TO REFLECT SUCH TRANSFER
AND RECEIPT OF PAYMENT FOR THE ACCOUNT OF THE PORTFOLIO;
5) THE CUSTODIAN WILL FURNISH THE PORTFOLIO CONFIRMATION OF EACH TRANSFER TO
OR FROM THE ACCOUNT OF THE PORTFOLIO, IN THE FORM OF A WRITTEN ADVICE OR NOTICE,
OF DIRECT PAPER ON THE NEXT BUSINESS DAY FOLLOWING SUCH TRANSFER AND WILL
FURNISH TO THE PORTFOLIO COPIES OF DAILY TRANSACTION SHEETS REFLECTING EACH
DAY'S TRANSACTION IN THE SECURITIES SYSTEM FOR THE ACCOUNT OF THE PORTFOLIO;
6) THE CUSTODIAN WILL PROVIDE THE PORTFOLIO WITH ANY REPORT ON ITS SYSTEM OF
INTERNAL ACCOUNTING CONTROL AS THE PORTFOLIO MAY REASONABLY REQUEST FROM TIME TO
TIME;
2.12 SEGREGATED ACCOUNT. THE CUSTODIAN WILL, UPON RECEIPT OF PROPER
INSTRUCTIONS, ESTABLISH AND MAINTAIN A SEGREGATED ACCOUNT OR ACCOUNTS FOR AND ON
BEHALF OF THE PORTFOLIO, INTO WHICH MAY BE TRANSFERRED CASH AND/OR SECURITIES,
INCLUDING SECURITIES MAINTAINED IN AN ACCOUNT BY THE CUSTODIAN PURSUANT TO
SECTION 2.10 OF THIS AGREEMENT; (I) IN ACCORDANCE WITH THE PROVISIONS OF ANY
AGREEMENT AMONG THE PORTFOLIO, THE CUSTODIAN AND A BROKER-DEALER REGISTERED
UNDER THE EXCHANGE ACT AND A MEMBER OF THE NASD (OR ANY FUTURES COMMISSION
MERCHANT REGISTERED UNDER THE COMMODITY EXCHANGE ACT), RELATING TO COMPLIANCE
WITH THE RULES OF THE OPTIONS CLEARING CORPORATION AND OF ANY REGISTERED
NATIONAL SECURITIES EXCHANGE (OR THE COMMODITY FUTURES TRADING COMMISSION OR ANY
REGISTERED CONTRACT MARKET), OR OF ANY SIMILAR ORGANIZATION OR ORGANIZATIONS,
REGARDING ESCROW OR OTHER ARRANGEMENTS IN CONNECTION WITH TRANSACTIONS BY THE
PORTFOLIO, (II) FOR PURPOSES OF SEGREGATING CASH OR GOVERNMENT SECURITIES IN
CONNECTION WITH OPTIONS PURCHASED, SOLD OR WRITTEN BY THE PORTFOLIO OR COMMODITY
FUTURES CONTRACTS OR OPTIONS THEREON PURCHASED OR SOLD BY THE PORTFOLIO, (III)
FOR THE PURPOSES OF COMPLIANCE BY THE PORTFOLIO WITH THE PROCEDURES REQUIRED BY
INVESTMENT COMPANY ACT RELEASE NO. 10666, OR ANY SUBSEQUENT RELEASE, RULE OR
POLICY, OF THE SECURITIES AND EXCHANGE COMMISSION RELATING TO THE MAINTENANCE OF
SEGREGATED ACCOUNTS BY REGISTERED INVESTMENT COMPANIES AND (IV) FOR OTHER PROPER
CORPORATE PURPOSES UPON RECEIPT OF A CERTIFIED COPY OF A RESOLUTION OF THE BOARD
OF TRUSTEES OR OF THE EXECUTIVE COMMITTEE SIGNED BY AN OFFICER OF THE PORTFOLIO
AND CERTIFIED BY THE SECRETARY OR AN ASSISTANT SECRETARY, SETTING FORTH THE
PURPOSE OR PURPOSES OF SUCH SEGREGATED ACCOUNT AND DECLARING SUCH PURPOSES TO BE
PROPER CORPORATE PURPOSES.
2.13 OWNERSHIP CERTIFICATES FOR TAX PURPOSES. THE CUSTODIAN WILL EXECUTE
OWNERSHIP AND OTHER CERTIFICATES AND AFFIDAVITS FOR ALL FEDERAL AND STATE TAX
PURPOSES IN CONNECTION WITH RECEIPT OF INCOME OR OTHER PAYMENTS FOR PORTFOLIO
SECURITIES AND IN CONNECTION WITH TRANSFERS OF SUCH SECURITIES.
2.14 PROXIES. IF THE SECURITIES ARE REGISTERED OTHER THAN IN THE NAME OF THE
PORTFOLIO OR A NOMINEE OF THE PORTFOLIO, THE CUSTODIAN WILL CAUSE ALL PROXIES
PROMPTLY TO BE EXECUTED BY THE REGISTERED HOLDER OF SUCH SECURITIES, WITHOUT
INDICATION OF THE MANNER IN WHICH SUCH PROXIES ARE TO BE VOTED, AND WILL
PROMPTLY DELIVER TO THE PORTFOLIO ALL PROXY SOLICITING MATERIALS AND ALL NOTICES
RELATING TO SUCH SECURITIES.
2.15 COMMUNICATIONS RELATING TO PORTFOLIO SECURITIES. THE CUSTODIAN WILL
TRANSMIT PROMPTLY TO THE PORTFOLIO ALL WRITTEN INFORMATION (INCLUDING, WITHOUT
LIMITATION, PENDENCY OF CALLS AND MATURITIES OF DOMESTIC SECURITIES AND
EXPIRATIONS OF RIGHTS IN CONNECTION THEREWITH AND NOTICES OF EXERCISE OF CALL
AND PUT OPTIONS WRITTEN BY THE PORTFOLIO AND THE MATURITY OF FUTURES CONTRACTS
PURCHASED OR SOLD BY THE PORTFOLIO) RECEIVED BY THE CUSTODIAN FROM ISSUERS OF
THE PORTFOLIO SECURITIES BY THE CUSTODIAN, AN AGENT APPOINTED UNDER SECTION 2.9,
OR SUBCUSTODIAN APPOINTED UNDER SECTION 1. WITH RESPECT TO TENDER OR EXCHANGE
OFFERS, THE CUSTODIAN WILL TRANSMIT PROMPTLY TO THE PORTFOLIO ALL WRITTEN
INFORMATION RECEIVED BY THE CUSTODIAN, AN AGENT APPOINTED UNDER SECTION 2.9, OR
SUBCUSTODIAN APPOINTED UNDER SECTION 1 FROM ISSUERS OF THE SECURITIES WHOSE
TENDER OR EXCHANGE IS SOUGHT AND FROM THE PARTY (OR ITS AGENTS) MAKING THE
TENDER OR EXCHANGE OFFER. IF THE PORTFOLIO DESIRES TO TAKE ACTION WITH RESPECT
TO ANY TENDER OFFER, EXCHANGE OFFER OR ANY OTHER SIMILAR TRANSACTION, THE
PORTFOLIO WILL NOTIFY THE CUSTODIAN OF SUCH DESIRED ACTION AT LEAST 3 BUSINESS
DAYS PRIOR TO THE TIME SUCH ACTION MUST BE TAKEN UNDER THE TERMS OF THE TENDER,
EXCHANGE OFFER, OR OTHER SIMILAR TRANSACTION, AND IT WILL BE THE RESPONSIBILITY
OF THE CUSTODIAN TO TIMELY TRANSMIT TO THE APPROPRIATE PERSON(S) THE PORTFOLIO'S
NOTICE. WHERE THE PORTFOLIO DOES NOT NOTIFY THE CUSTODIAN OF ITS DESIRED ACTION
WITHIN THE 3 BUSINESS DAY PERIOD, THE CUSTODIAN WILL USE ITS BEST EFFORTS TO
TIMELY TRANSMIT THE FUND'S NOTICE TO THE APPROPRIATE PERSON.
2.16 REPORTS TO PORTFOLIO BY INDEPENDENT PUBLIC ACCOUNTANTS. THE CUSTODIAN WILL
PROVIDE THE PORTFOLIO, AT SUCH TIMES AS THE PORTFOLIO MAY REASONABLY REQUIRE,
WITH REPORTS BY INDEPENDENT PUBLIC ACCOUNTANTS ON THE ACCOUNTING SYSTEM,
INTERNAL ACCOUNTING CONTROL AND PROCEDURES FOR SAFEGUARDING SECURITIES, FUTURES
CONTRACTS AND OPTIONS ON FUTURES CONTRACTS, INCLUDING SECURITIES DEPOSITED
AND/OR MAINTAINED IN A SECURITIES SYSTEM, RELATING TO THE SERVICES PROVIDED BY
THE CUSTODIAN UNDER THIS CONTRACT; SUCH REPORTS WILL BE OF SUFFICIENT SCOPE AND
IN SUFFICIENT DETAIL, AS MAY REASONABLY BE REQUIRED BY THE PORTFOLIO TO PROVIDE
REASONABLE ASSURANCE THAT ANY MATERIAL INADEQUACIES EXISTING OR ARISING SINCE
THE PRIOR EXAMINATION WOULD BE DISCLOSED BY SUCH EXAMINATION. THE REPORTS MUST
DESCRIBE ANY MATERIAL INADEQUACIES DISCLOSED AND, IF THERE ARE NO SUCH
INADEQUACIES, THE REPORTS WILL SO STATE.
3. PAYMENTS FOR REDEMPTIONS OF SHARES OF THE PORTFOLIO
FROM SUCH FUNDS AS MAY BE AVAILABLE FOR THE PURPOSE BUT SUBJECT TO THE
LIMITATIONS OF THE GOVERNING DOCUMENTS OF THE PORTFOLIO AND ANY APPLICABLE VOTES
OF THE BOARD OF TRUSTEES OF THE FUND PURSUANT THERETO, THE CUSTODIAN WILL, UPON
RECEIPT OF INSTRUCTIONS FROM THE TRANSFER AGENT, MAKE FUNDS AVAILABLE FOR
PAYMENT TO HOLDERS OF SHARES WHO HAVE DELIVERED TO THE TRANSFER AGENT A REQUEST
FOR REDEMPTION OF THEIR SHARES. IN CONNECTION WITH THE REDEMPTION OF SHARES OF
THE PORTFOLIO, THE CUSTODIAN IS AUTHORIZED UPON RECEIPT OF INSTRUCTIONS FROM THE
TRANSFER AGENT TO WIRE FUNDS TO OR THROUGH A COMMERCIAL BANK DESIGNATED BY THE
REDEEMING SHAREHOLDER.
THE CUSTODIAN WILL RECEIVE PAYMENTS FOR PORTFOLIO SHARES ISSUED OR SOLDFROM
THE DISTRIBUTOR FOR THE PORTFOLIO'S SHARES OR FROM THE TRANSFER AGENT OF THE
PORTFOLIO AND DEPOSIT AS RECEIVED INTO THE FUND'S ACCOUNT SUCH PAYMENTS AS ARE
RECEIVED FOR SHARES OF THE PORTFOLIO ISSUED OR SOLD FROM TIME TO TIME BY THE
PORTFOLIO. THE CUSTODIAN WILL PROVIDE TIMELY NOTIFICATION TO THE PORTFOLIO AND
THE TRANSFER AGENT OF ANY RECEIPT BY IT OF PAYMENTS FOR SHARES OF THE PORTFOLIO.
4. PROPER INSTRUCTIONS
"PROPER INSTRUCTIONS" MEANS A WRITING SIGNED OR INITIALLED BY ONE OR MORE
PERSONS AUTHORIZED BY THE BOARD OF TRUSTEES. EACH SUCH WRITING MUST SET FORTH
THE SPECIFIC TRANSACTION OR TYPE OF TRANSACTION INVOLVED, INCLUDING A STATEMENT
OF THE PURPOSE FOR WHICH SUCH ACTION IS REQUESTED, AND MAY BE A BLANKET
INSTRUCTION AUTHORIZING SPECIFIC TRANSACTIONS OF A ROUTINE NATURE OR OCCURING
REPEATEDLY. ORAL INSTRUCTIONS WILL BE CONSIDERED PROPER INSTRUCTIONS IF THE
CUSTODIAN REASONABLY BELIEVES THEM TO HAVE BEEN GIVEN BY A PERSON AUTHORIZED TO
GIVE SUCH INSTRUCTIONS WITH RESPECT TO THE TRANSACTION INVOLVED. THE PORTFOLIO
WILL CAUSE ALL ORAL INSTRUCTIONS TO BE CONFIRMED IN WRITING. UPON RECEIPT OF A
CERTIFICATE OF THE SECRETARY OR AN ASSISTANT SECRETARY AS TO THE AUTHORIZATION
BY THE BOARD OF TRUSTEES OF THE FUND, ACCOMPANIED BY A DETAILED DESCRIPTION OF
PROCEDURES APPROVED BY THE BOARD OF TRUSTEES, PROPER INSTRUCTIONS MAY INCLUDE
COMMUNICATIONS EFFECTED DIRECTLY BETWEEN ELECTRO-MECHANICAL OR ELECTRONIC
DEVICES PROVIDED THAT THE BOARD OF TRUSTEES AND THE CUSTODIAN ARE SATISFIED THAT
SUCH PROCEDURES AFFORD ADEQUATE SAFEGUARDS FOR THE PORTFOLIO'S ASSETS.
5. ACTIONS PERMITTED WITHOUT EXPRESS AUTHORITY
IN ITS DISCRETION THE CUSTODIAN MAY, WITHOUT EXPRESS AUTHORITY FROM THE
PORTFOLIO:
L) MAKE PAYMENTS TO ITSELF OR OTHERS FOR MINOR EXPENSES OF HANDLING
SECURITIES OR OTHER SIMILAR ITEMS RELATING TO ITS DUTIES UNDER THIS AGREEMENT,
PROVIDED THAT ALL SUCH PAYMENTS WILL BE ACCOUNTED FOR TO THE PORTFOLIO;
2) SURRENDER SECURITIES IN TEMPORARY FORM FOR SECURITIES IN DEFINITIVE FORM;
3) ENDORSE FOR COLLECTION, IN THE NAME OF THE PORTFOLIO, CHECKS, DRAFTS AND
OTHER NEGOTIABLE INSTRUMENTS ON THE SAME DAY AS RECEIVED; AND
4) IN GENERAL, ATTEND TO ALL NONDISCRETIONARY DETAILS IN CONNECTION WITH THE
SALE, EXCHANGE, SUBSTITUTION, PURCHASE, TRANSFER AND OTHER DEALINGS WITH THE
SECURITIES AND PROPERTY OF THE PORTFOLIO EXCEPT AS OTHERWISE DIRECTED BY THE
BOARD OF TRUSTEES OF THE FUND.
6. EVIDENCE OF AUTHORITY, RELIANCE ON DOCUMENTS
THE CUSTODIAN WILL NOT BE LIABLE FOR ACTIONS TAKEN PURSUANT TO
INSTRUCTIONS, NOTICE, REQUEST, CONSENT, CERTIFICATE OR OTHER INSTRUMENT OR PAPER
REASONABLY AND IN GOOD FAITH BELIEVED BY IT TO BE GENUINE AND TO HAVE BEEN
PROPERLY EXECUTED BY OR ON BEHALF OF THE PORTFOLIO IN ACCORDANCE WITH PROPER
INSTRUCTIONS AS DEFINED IN SECTION 4 OF THIS AGREEMENT. THE CUSTODIAN MAY
RECEIVE AND ACCEPT A CERTIFIED COPY OF A VOTE OF THE BOARD OF TRUSTEES OF THE
FUND AS CONCLUSIVE EVIDENCE (A) OF THE AUTHORITY OF ANY PERSON TO ACT IN
ACCORDANCE WITH SUCH VOTE OR (B) OF ANY DETERMINATION OR OF ANY ACTION BY THE
BOARD OF TRUSTEES PURSUANT TO THE GOVERNING DOCUMENTS OF THE FUND AS DESCRIBED
IN SUCH VOTE, AND SUCH VOTE MAY BE CONSIDERED AS IN FULL FORCE AND EFFECT UNTIL
RECEIPT BY THE CUSTODIAN OF WRITTEN NOTICE TO THE CONTRARY. SO LONG AS AND TO
THE EXTENT THAT IT IS IN THE EXERCISE OF THE STANDARD OF CARE SET FORTH IN
SECTION 11 OF THIS AGREEMENT, THE CUSTODIAN WILL NOT BE RESPONSIBLE FOR THE
TITLE, VALIDITY OR GENUINENESS OF ANY PROPERTY OR EVIDENCE OF TIT!E RECEIVED BY
IT OR DELIVERED BY IT PURSUANT TO THIS AGREEMENT AND WILL BE HELD HARMLESS IN
ACTING UPON ANY NOTICE, REQUEST, CONSENT, CERTIFICATE OR OTHER INSTRUMENT
REASONABLY BELIEVED BY IT TO BE GENUINE AND TO BE SIGNED BY THE PROPER PARTY OR
PARTIES.
7. RECORDS, INVENTORY
THE CUSTODIAN WILL CREATE AND MAINTAIN ALL RECORDS RELATING TO ITS
ACTIVITIES AND OBLIGATIONS UNDER THIS AGREEMENT IN SUCH MANNER AS WILL MEET THE
OBLIGATIONS OF THE PORTFOLIO UNDER THE INVESTMENT COMPANY ACT OF 1940, WITH
PARTICULAR ATTENTION TO SECTION 31 AND RULES 31A-1 AND 31A-2 THEREUNDER,
APPLICABLE FEDERAL AND STATE TAX LAWS AND ANY OTHER LAW OR ADMINISTRATIVE RULES
OR PROCEDURES THAT MAY BE APPLICABLE TO THE PORTFOLIO. ALL SUCH RECORDS WILL BE
THE PROPERTY OF THE PORTFOLIO AND WILL AT ALL TIMES DURING THE REGULAR BUSINESS
HOURS OF THE CUSTODIAN BE OPEN FOR INSPECTION AND AUDIT BY DULY AUTHORIZED
OFFICERS, EMPLOYEES OR AGENTS OF THE PORTFOLIO AND EMPLOYEES AND AGENTS OF THE
SECURITIES AND EXCHANGE COMMISSION, AND, IN THE EVENT OF TERMINATION OF THIS
AGREEMENT, WILL BE DELIVERED IN ACCORDANCE WITH SECTION 12 OF THIS AGREEMENT.
THE CUSTODIAN WILL, AT THE PORTFOLIO'S REQUEST, SUPPLY THE PORTFOLIO WITH A
TABULATION OF SECURITIES OWNED BY THE PORTFOLIO AND HELD BY THE CUSTODIAN AND
WILL, WHEN REQUESTED TO DO SO BY THE PORTFOLIO AND FOR SUCH COMPENSATION AS WILL
BE AGREED UPON BETWEEN THE PORTFOLIO AND THE CUSTODIAN, INCLUDE CERTIFICATE
NUMBERS IN SUCH TABULATIONS. THE CUSTODIAN WILL CONDUCT A PERIODIC INVENTORY OF
ALL SECURITIES AND OTHER PROPERTY SUBJECT TO THIS AGREEMENT AND PROVIDE TO THE
PORTFOLIO A PERIODIC RECONCILIATION OF THE VAULTED POSITION OF THE PORTFOLIO TO
THE APPRAISED POSITION OF THE PORTFOLIO. THE CUSTODIAN WILL PROMPTLY REPORT TO
THE PORTFOLIO THE RESULTS OF THE RECONCILIATION, INDICATING ANY SHORTAGES OR
DISCREPANCIES UNCOVERED THEREBY, AND TAKE APPROPRIATE ACTION TO REMEDY ANY SUCH
SHORTAGES OR DISCREPANCIES.
8. OPINION OF THE PORTFOLIO'S INDEPENDENT ACCOUNTANT
THE CUSTODIAN WILL COOPERATE WITH THE PORTFOLIO'S INDEPENDENT PUBLIC
ACCOUNTANTS IN CONNECTION WITH THE ANNUAL AND OTHER AUDITS OF THE BOOKS AND
RECORDS OF THE PORTFOLIO AND TAKE ALL REASONABLE ACTION, AS THE PORTFOLIO MAY
FROM TIME TO TIME REQUEST, TO PROVIDE THE NECESSARY INFORMATION TO SUCH
ACCOUNTANTS FOR THE EXPRESSION OF THEIR OPINION WITHOUT ANY QUALIFICATION AS TO
THE SCOPE OF THEIR EXAMINATION, INCLUDING BUT NOT LIMITED TO, ANY OPINION IN
CONNECTION WITH THE PREPARATION OF THE PORTFOLIO'S FORM N-LA, AND FORM N-SAR OR
OTHER REPORTS TO THE SECURITIES AND EXCHANGE COMMISSION OR STATE REGULATORY
AGENCY AND WITH RESPECT TO ANY OTHER LEGAL REQUIREMENTS.
9. COMPENSATION OF CUSTODIAN
THE CUSTODIAN WILL BE ENTITLED TO REASONABLE COMPENSATION FOR ITS SERVICES
AND EXPENSES AS CUSTODIAN, AS AGREED UPON FROM TIME TO TIME BETWEEN THE
PORTFOLIO AND THE CUSTODIAN.
10. RESPONSIBILITY OF CUSTODIAN - INDEMNIFICATION
REASONABLE CARE - NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THIS
AGREEMENT, THE CUSTODIAN WILL BE HELD TO THE EXERCISE OF REASONABLE CARE IN
CARRYING OUT THE PROVISIONS OF THIS AGREEMENT, BUT WILL BE KEPT INDEMNIFIED BY
AND WILL BE WITHOUT LIABILITY TO THE PORTFOLIO FOR ANY ACTION TAKEN OR OMITTED
BY IT IN GOOD FAITH WITHOUT NEGLIGENCE.
NOTICE TO PORTFOLIO - IN ORDER FOR THE INDEMNIFICATION PROVISION CONTAINED
IN THIS SECTION TO APPLY, IT IS UNDERSTOOD THAT IF IN ANY CASE THE PORTFOLIO MAY
BE ASKED TO INDEMNIFY OR HOLD THE CUSTODIAN HARMLESS, THE PORTFOLIO WILL BE
FULLY AND PROMPTLY ADVISED OF ALL PERTINENT FACTS CONCERNING THE SITUATION IN
QUESTION, AND IT IS FURTHER UNDERSTOOD THAT THE CUSTODIAN WILL USE ALL
REASONABLE CARE TO IDENTIFY AND NOTIFY THE PORTFOLIO PROMPTLY CONCERNING ANY
SITUATION WHICH PRESENTS OR APPEARS LIKELY TO PRESENT THE PROBABILITY OF SUCH A
CLAIM FOR INDEMNIFICATION AGAINST THE PORTFOLIO.
DEFENSE OF CUSTODIAN - THE PORTFOLIO WILL HAVE THE OPTION TO DEFEND THE
CUSTODIAN AGAINST ANY CLAIM WHICH MAY BE THE SUBJECT OF THIS INDEMNIFICATION,
AND IN THE EVENT THAT THE PORTFOLIO SO ELECTS, IT WILL SO NOTIFY THE CUSTODIAN,
AND THEREUPON THE PORTFOLIO WILL TAKE OVER COMPLETE DEFENSE OF THE CLAIM AND THE
CUSTODIAN WILL IN SUCH SITUATION INITIATE NO FURTHER LEGAL OR OTHER EXPENSES FOR
WHICH IT WILL SEEK INDEMNIFICATION UNDER THIS SECTION. THE CUSTODIAN WILL IN NO
CASE CONFESS ANY CLAIM OR MAKE ANY COMPROMISE IN ANY CASE IN WHICH THE PORTFOLIO
WILL BE ASKED TO INDEMNIFY THE CUSTODIAN EXCEPT WITH THE PORTFOLIO'S PRIOR
WRITTEN CONSENT. NOTHING IN THIS SECTION WILL BE CONSTRUED TO LIMIT ANY RIGHT
OR CAUSE OF ACTION ON THE PART OF THE CUSTODIAN UNDER THIS AGREEMENT WHICH IS
INDEPENDENT OF ANY RIGHT OR CAUSE OF ACTION ON THE PART OF THE PORTFOLIO. THE
CUSTODIAN WILL BE ENTITLED TO RELY ON AND MAY ACT UPON ADVICE OF COUNSEL (WHO
MAY BE COUNSEL FOR THE PORTFOLIO OR SUCH OTHER COUNSEL AS MAY BE AGREED TO BY
THE PARTIES) ON ALL MATTERS, AND WILL BE WITHOUT LIABILITY FOR ANY ACTION
REASONABLY TAKEN OR OMITTED PURSUANT TO SUCH ADVICE.
IF THE PORTFOLIO REQUIRES THE CUSTODIAN TO TAKE ANY ACTION WITH RESPECT TO
SECURITIES THAT INVOLVES THE PAYMENT OF MONEY, OR THAT MAY, IN THE OPINION OF
THE CUSTODIAN, RESULT IN THE CUSTODIAN OR ITS NOMINEE ASSIGNED TO THE PORTFOLIO
BEING LIABLE FOR THE PAYMENT OF MONEY OR INCURRING LIABILITY OF SOME OTHER FORM,
THE PORTFOLIO, AS A PREREQUISITE TO REQUIRING THE CUSTODIAN TO TAKE SUCH ACTION,
WILL INDEMNIFY THE CUSTODIAN IN AN AMOUNT AND FORM SATISFACTORY TO IT.
IF THE PORTFOLIO REQUIRES THE CUSTODIAN TO ADVANCE CASH OR SECURITIES FOR
ANY PURPOSE OR IN THE EVENT THAT THE CUSTODIAN OR ITS NOMINEE INCURS OR IS
ASSESSED ANY TAXES, CHARGES, EXPENSES, ASSESSMENTS, CLAIMS OR LIABILITIES IN
CONNECTION WITH THE PERFORMANCE OF THIS AGREEMENT, EXCEPT AS MAY ARISE FROM THE
CUSTODIAN'S OR ITS AGENT'S NEGLIGENT ACTION OR OMISSION, OR WILLFUL MISCONDUCT,
ANY PROPERTY HELD FOR THE ACCOUNT OF THE PORTFOLIO WILL SERVE AS SECURITY. IF
THE PORTFOLIO FAILS TO REPAY THE CUSTODIAN PROMPTLY, THE CUSTODIAN WILL BE
ENTITLED TO USE AVAILABLE CASH AND TO DISPOSE OF THE PORTFOLIO'S ASSETS TO THE
EXTENT NECESSARY FOR REIMBURSEMENT. IF THE CUSTODIAN EXERCISES THIS OPTION, IT
MUST GIVE THE PORTFOLIO REASONABLE NOTICE SO AS TO ENABLE THE PORTFOLIO TO REPAY
THE CASH OR SECURITIES ADVANCED. SUCH NOTICE WILL NOT PRECLUDE THE CUSTODIAN
FROM ASSERTING ANY LIEN UNDER THIS PROVISION.
11. EFFECTIVE PERIOD, TERMINATION AND AMENDMENT
THIS AGREEMENT WILL BECOME EFFECTIVE AS OF ITS EXECUTION, AND WILL CONTINUE
IN FORCE UNTIL TERMINATED AS PROVIDED IN THIS SECTION. IT MAY BE AMENDED AT ANY
TIME BY MUTUAL AGREEMENT OF THE PARTIES, AND MAY BE TERMINATED BY EITHER PARTY
WITH 60 DAYS WRITTEN NOTICE. THE PORTFOLIO MAY, BY ACTION OF THE FUND'S BOARD
OF TRUSTEES, IMMEDIATELY TERMINATE THIS AGREEMENT IN THE EVENT OF THE
APPOINTMENT OF A CONSERVATOR OR RECEIVER FOR THE CUSTODIAN BY THE COMPTROLLER OF
THE CURRENCY OR A LIKE EVENT AT THE DIRECTION OF AN APPROPRIATE REGULATORY
AGENCY OR COURT OF COMPETENT JURISDICTION.
IN THE EVENT THE AGREEMENT TERMINATES, THE PORTFOLIO WILL PAY THE CUSTODIAN
WHATEVER COMPENSATION IS DUE AS OF THE DATE OF THE TERMINATION, AND WILL
REIMBURSE THE CUSTODIAN FOR COSTS, EXPENSES AND DISBURSEMENTS INCURRED IN
CONNECTION WITH TERMINATION, BUT ONLY TO THE EXTENT THE PORTFOLIO GIVES PRIOR
APPROVAL FOR THE EXPENDITURES. APPROVAL WILL NOT BE UNREASONABLY WITHHELD.
12. SUCCESSOR CUSTODIAN
IF A SUCCESSOR CUSTODIAN IS APPOINTED BY THE BOARD OF TRUSTEES OF THE FUND,
THE CUSTODIAN WILL, UPON TERMINATION, DELIVER TO THE SUCCESSOR CUSTODIAN AT THE
OFFICE OF THE CUSTODIAN, DULY ENDORSED AND IN THE FORM FOR TRANSFER, ALL
SECURITIES, FUNDS AND OTHER PROPERTIES THEN HELD BY IT PURSUANT TO THIS
AGREEMENT, AND WILL TRANSFER TO AN ACCOUNT OF THE SUCCESSOR CUSTODIAN ALL OF THE
PORTFOLIO'S SECURITIES HELD IN A SECURITIES SYSTEM. THE CUSTODIAN WILL USE ITS
BEST EFFORTS TO ASSURE THAT THE SUCCESSOR CUSTODIAN WILL CONTINUE ANY
SUBCUSTODIAN AGREEMENT ENTERED INTO BY THE CUSTODIAN AND ANY SUBCUSTODIAN ON
BEHALF OF THE PORTFOLIO.
IF NO SUCCESSOR IS TO BE APPOINTED, THE CUSTODIAN WILL MAKE THE SECURITIES,
FUNDS AND OTHER PROPERTIES AVAILABLE AS ABOVE TO THE PORTFOLIO UPON RECEIPT OF A
CERTIFIED COPY OF A VOTE OF THE BOARD OF TRUSTEES OF THE FUND.
IF NO WRITTEN ORDER DESIGNATING A SUCCESSOR CUSTODIAN OR CERTIFIED COPY OF
A VOTE OF THE BOARD OF TRUSTEES IS DELIVERED TO THE CUSTODIAN ON OR BEFORE THE
EFFECTIVE DATE OF THE TERMINATION, THE CUSTODIAN WILL HAVE THE RIGHT TO MAKE
DELIVERY TO A BANK (AS DEFINED IN THE INVESTMENT COMPANY ACT OF 1940) OR TRUST
COMPANY OF ITS OWN SELECTION HAVING AGGREGATE CAPITAL, SURPLUS, AND UNDIVIDED
PROFITS, AS SHOWN BY ITS LAST PUBLISHED REPORT, OF NOT LESS THAN $25,000,000,
WHICH WILL BECOME THE SUCCESSOR CUSTODIAN UNDER THIS AGREEMENT.
IN THE EVENT THE SECURITIES, FUNDS AND OTHER PROPERTIES REMAIN IN THE
POSSESSION OF THE CUSTODIAN AFTER THE TERMINATION DATE DUE TO FAILURE BY THE
PORTFOLIO TO PROCURE THE CERTIFIED COPY OF THE APPROPRIATE VOTE OF THE BOARD OF
TRUSTEES, THE CUSTODIAN WILL BE ENTITLED TO FAIR COMPENSATION FOR ITS SERVICES
DURING THE PERIOD DURING WHICH IT RETAINS POSSESSION OF THE PROPERTY, AND THE
PROVISIONS OF THIS AGREEMENT RELATING TO THE DUTIES AND OBLIGATIONS OF THE
CUSTODIAN WILL REMAIN IN FULL FORCE.
IF DURING THE TERM OF THIS AGREEMENT THE PORTFOLIO IS LIQUIDATED PURSUANT
TO LAW, THE CUSTODIAN WILL DISTRIBUTE THE REMAINING ASSETS OF THE PORTFOLIO
AFTER SATISFYING ALL EXPENSES AND LIABILITIES OF THE PORTFOLIO. SUCH
DISTRIBUTIONS WILL BE PRO RATA AMONG THE PORTFOLIO'S SHAREHOLDERS AS CERTIFIED
BY THE TRANSFER AGENT, AND WILL BE IN CASH OR, IF THE PORTFOLIO SO ORDERS, IN
PORTFOLIO SECURITIES. SECTION 10 (RESPONSIBILITY OF CUSTODIAN) WILL SURVIVE ANY
TERMINATION OF THIS AGREEMENT.
13. INTERPRETIVE AND ADDITIONAL PROVISIONS
IN CONNECTION WITH THE OPERATION OF THIS AGREEMENT, THE CUSTODIAN AND THE
PORTFOLIO MAY FROM TIME TO TIME AGREE ON SUCH PROVISIONS INTERPRETIVE OF OR IN
ADDITION TO THE PROVISIONS OF THIS AGREEMENT AS MAY IN THEIR JOINT OPINION BE
CONSISTENT WITH THE GENERAL TENOR OF THIS AGREEMENT. ANY SUCH INTERPRETIVE OR
ADDITIONAL PROVISIONS WILL BE IN A WRITING SIGNED BY BOTH PARTIES AND WILL BE
ANNEXED TO TH IS AGREEMENT. NO INTERPRETIVE OR ADDITIONAL PROVISIONS WILL
CONTRAVENE ANY APPLICABLE FEDERAL OR STATE REGULATIONS OR ANY PROVISION OF THE
GOVERNING DOCUMENTS OF THE PORTFOLIO, NOR WILL THEY BE DEEMED AMENDMENTS TO THIS
AGREEMENT.
14. NOTICE
NOTICE WILL BE CONSIDERED SUFFICIENT IF SENT BY REGISTERED OR CERTIFIED
MAIL, OR BY SUCH OTHER MEANS AS THE PARTIES AGREE, TO THE OTHER PARTY AT THE
ADDRESS SET FORTH ABOVE OR AT ANY OTHER ADDRESS SPECIFIED IN WRITING AND
DELIVERED TO THE OTHER PARTY.
15. BOND
THE CUSTODIAN WILL, AT ALL TIMES, MAINTAIN A BOND ISSUED BY A REPUTABLE
FIDELITY INSURANCE COMPANY AUTHORIZED TO DO BUSINESS IN THE PLACE WHERE THE BOND
IS ISSUED. THE BOND WILL BE ISSUED AGAINST LARCENY AND EMBEZZLEMENT, AND WILL
COVER EACH OFFICER AND EMPLOYEE OF THE CUSTODIAN WHO MAY, SINGLY OR JOINTLY WITH
OTHERS, HAVE ACCESS TO SECURITIES OR FUNDS OF THE PORTFOLIO, EITHER DIRECTLY OR
THROUGH AUTHORITY TO RECEIVE AND CARRY OUT ANY CERTIFICATE INSTRUCTION, ORDER
REQUEST, NOTE OR OTHER INSTRUMENT REQUIRED OR PERMITTED BY THIS AGREEMENT. THE
CUSTODIAN AGREES THAT IT WILL NOT CANCEL, TERMINATE OR MODIFY THE BOND SO AS TO
AFFECT ADVERSELY THE PORTFOLIO, EXCEPT AFTER WRITTEN NOTICE TO THE PORTFOLIO NOT
LESS THAN 10 DAYS PRIOR TO THE EFFECTIVE DATE OF SUCH CANCELLATION, TERMINATION
OR MODIFICATION. THE CUSTODIAN WILL FURNISH TO THE PORTFOLIO A COPY OF EACH
SUCH BOND AND EACH AMENDMENT THERETO.
16. CONFIDENTIALITY
THE CUSTODIAN AGREES TO TREAT ALL RECORDS AND OTHER INFORMATION RELATIVE TO
THE PORTFOLIO AND ITS PRIOR, PRESENT OR FUTURE SHAREHOLDERS AS CONFIDENTIAL, AND
THE CUSTODIAN, ON BEHALF OF ITSELF AND ITS EMPLOYEES, AGREES TO KEEP
CONFIDENTIAL ALL SUCH INFORMATION EXCEPT WHEN REQUESTED TO DIVULGE SUCH
INFORMATION BY DULY CONSTITUTED AUTHORITIES, OR WHEN SO REQUESTED BY THE
PORTFOLIO. IF REQUESTED TO DIVULGE CONFIDENTIAL INFORMATION, THE CUSTODIAN WILL
NOT RELEASE THE INFORMATION UNTIL IT NOTIFIES THE PORTFOLIO IN WRITING AND
RECEIVES APPROVAL IN WRITING FROM THE PORTFOLIO. APPROVAL BY THE PORTFOLIO WILL
NOT BE UNREASONABLY WITHHELD AND MAY NOT BE WITHHELD WHERE THE CUSTODIAN MAY BE
EXPOSED TO CIVIL OR CRIMINAL CONTEMPT PROCEEDINGS FOR FAILURE TO COMPLY.
17. EXEMPTION FROM LIENS
THE SECURITIES AND OTHER ASSETS HELD BY THE CUSTODIAN FOR THE PORTFOLIO
WILL BE SUBJECT TO NO LIEN OR CHARGE OF ANY KIND IN FAVOR OF THE CUSTODIAN OR
ANY PERSON CLAIMING THROUGH THE CUSTODIAN, BUT NOTHING HEREIN WILL BE DEEMED TO
DEPRIVE THE CUSTODIAN OF ITS RIGHT TO INVOKE ANY AND ALL REMEDIES AVAILABLE AT
LAW OR EQUITY TO COLLECT AMOUNTS DUE IT UNDER THIS AGREEMENT. NEITHER THE
CUSTODIAN NOR ANY SUBCUSTODIAN APPOINTED PURSUANT TO SECTION 1 OF THIS AGREEMENT
WILL HAVE ANY POWER OR AUTHORITY TO ASSIGN, HYPOTHECATE, PLEDGE OR OTHERWISE
DISPOSE OF ANY SECURITIES HELD BY IT FOR THE PORTFOLIO, EXCEPT UPON THE
DIRECTION OF THE PORTFOLIO, DULY GIVEN AS HEREIN PROVIDED, AND ONLY FOR THE
ACCOUNT OF THE PORTFOLIO.
18. MASSACHUSETTS LAW TO APPLY
THIS AGREEMENT WILL BE CONSTRUED AND THE PROVISIONS THEREOF INTERPRETED
UNDER AND IN ACCORDANCE WITH LAWS OF THE COMMONWEALTH OF MASSACHUSETTS.
19. GOVERNING DOCUMENTS
THE TERM "GOVERNING DOCUMENTS" REFERS TO THE FUND'S AGREEMENT OF TRUST,
BY-LAWS AND REGISTRATION STATEMENT FILED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED FROM TIME TO TIME WITH REGARD TO THE PORTFOLIO.
20. DIRECTORS AND TRUSTEES
NEITHER THE HOLDERS OF SHARES IN THE PORTFOLIO NOR ANY DIRECTORS OR
TRUSTEES OF THE FUND WILL BE PERSONALLY LIABLE HEREUNDER.
21. MASSACHUSETTS BUSINESS TRUST
WITH RESPECT TO THE PORTFOLIO WHICH IS A PARTY TO THIS AGREEMENT AND WHICH
IS ORGANIZED AS A MASSACHUSETTS BUSINESS TRUST, THE TERM FUND MEANS AND REFERS
TO THE TRUSTEES SERVING UNDER THE APPLICABLE TRUST AGREEMENT. IT IS EXPRESSLY
AGREED THAT THE OBLIGATIONS OF THE TRUST UNDER THIS AGREEMENT WILL NOT BE
BINDING ON ANY OF THE TRUSTEES, SHAREHOLDERS, NOMINEES, OFFICERS, AGENTS OR
EMPLOYEES OF THE TRUST PERSONALLY, BUT BIND ONLY THE TRUST PROPERTY.
22. SUCCESSORS OF PARTIES
THIS CONTRACT WILL BE BINDING ON AND WILL INURE TO THE BENEFIT OF THE
PORTFOLIO AND THE CUSTODIAN AND THEIR RESPECTIVE SUCCESSORS.
IN WITNESS WHEREOF, EACH OF THE PARTIES HAS CAUSED THIS INSTRUMENT TO BE
EXECUTED IN ITS NAME AND BEHALF BY ITS DULY AUTHORIZED REPRESENTATIVE AND ITS
SEAL TO BE AFFIXED HEREUNDER AS OF THE DATES INDICATED BELOW.
[FUND]
ATTEST: BY:
STATE STREET TRUST COMPANY
ATTEST: BY
SUB-TRANSFER AGENCY AND SERVICE AGREEMENT
BETWEEN
CALVERT SHAREHOLDER SERVICES, INC.
AND
STATE STREET BANK AND TRUST COMPANY
<PAGE>
TABLE OF CONTENTS
1. DUTIES OF THE BANK 1
2. FEES AND EXPENSES 3
3. WIRE TRANSFER OPERATING GUIDELINES 4
4. DATA ACCESS AND PROPRIETARY INFORMATION 5
5. INDEMNIFICATION 6
6. STANDARD OF CARE 8
7. COVENANTS OF THE TRANSFER AGENT AND THE BANK 8
8. REPRESENTATIONS AND WARRANTIES OF THE BANK 9
9. REPRESENTATIONS AND WARRANTIES OF THE TRANSFER AGENT 9
10. TERMINATION OF AGREEMENT 10
11. ASSIGNMENT 10
12. AMENDMENT 10
13. MASSACHUSETTS LAW TO APPLY 10
14. FORCE MAJEURE 11
15. CONSEQUENTIAL DAMAGES 11
16. LIMITATION OF SHAREHOLDER LIABILITY 11
17. MERGER OF AGREEMENT 11
18. SURVIVAL 11
19. SEVERABILITY 11
20. COUNTERPARTS 12
<PAGE>
SUB-TRANSFER AGENCY AND SERVICE AGREEMENT
AGREEMENT MADE AS OF THE 15TH DAY OF AUGUST, 1996, BY AND
BETWEEN, CALVERT SHAREHOLDER SERVICES, INC. A CORPORATION, HAVING ITS
PRINCIPAL OFFICE AND PLACE OF BUSINESS AT 4550 MONTGOMERY AVE. SUITE
1000N, BETHESDA, MARYLAND, 20814 (THE "TRANSFER AGENT"), AND STATE
STREET BANK AND TRUST COMPANY, A MASSACHUSETTS TRUST COMPANY HAVING ITS
PRINCIPAL OFFICE AND PLACE OF BUSINESS AT 225 FRANKLIN STREET, BOSTON,
MASSACHUSETTS 02110 (THE "BANK");
WHEREAS, THE TRANSFER AGENT HAS BEEN APPOINTED BY EACH OF THE
INVESTMENT COMPANIES (INCLUDING EACH SERIES THEREOF) LISTED ON SCHEDULE
A (THE "FUND(S)"), EACH AN OPEN-END MANAGEMENT INVESTMENT COMPANY
REGISTERED UNDER THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED, AS
TRANSFER AGENT, DIVIDEND DISBURSING AGENT AND SHAREHOLDER SERVICING
AGENT IN CONNECTION WITH CERTAIN ACTIVITIES, AND THE TRANSFER AGENT HAS
ACCEPTED EACH SUCH APPOINTMENT;
WHEREAS, THE TRANSFER AGENT HAS ENTERED INTO A TRANSFER AGENCY
AND SERVICE AGREEMENT WITH EACH OF THE FUNDS (INCLUDING EACH SERIES
THEREOF) LISTED ON SCHEDULE A PURSUANT TO WHICH THE TRANSFER AGENT IS
RESPONSIBLE FOR CERTAIN TRANSFER AGENCY AND DIVIDEND DISBURSING
FUNCTIONS FOR EACH FUND'S AUTHORIZED AND ISSUED SHARES OF COMMON STOCK
OR SHARES OF BENEFICIAL INTEREST AS THE CASE MAY BE ("SHARES") AND EACH
FUND'S SHAREHOLDERS ("SHAREHOLDERS") AND THE TRANSFER AGENT IS
AUTHORIZED TO SUBCONTRACT FOR THE PERFORMANCE OF ITS OBLIGATIONS AND
DUTIES THEREUNDER IN WHOLE OR IN PART WITH THE BANK;
WHEREAS, THE TRANSFER AGENT DESIRES TO APPOINT THE BANK AS ITS
SUB-TRANSFER AGENT, AND THE BANK DESIRES TO ACCEPT SUCH APPOINTMENT;
NOW, THEREFORE, IN CONSIDERATION OF THE MUTUAL COVENANT HEREIN
CONTAINED, THE PARTIES HERETO AGREE AS FOLLOWS:
1. DUTIES OF THE BANK
1.1 SUBJECT TO THE TERMS AND CONDITIONS SET FORTH IN THIS
AGREEMENT, THE BANK SHALL ACT AS THE TRANSFER AGENT'S SUB-TRANSFER
AGENT FOR SHARES IN CONNECTION WITH ANY ACCUMULATION PLAN, OPEN
ACCOUNT, DIVIDEND REINVESTMENT PLAN, RETIREMENT PLAN OR SIMILAR PLAN
PROVIDED TO SHAREHOLDERS AND SET OUT IN EACH FUND'S CURRENTLY EFFECTIVE
PROSPECTUS AND STATEMENT OF ADDITIONAL INFORMATION ("PROSPECTUS"),
INCLUDING WITHOUT LIMITATION ANY PERIODIC INVESTMENT PLAN OR PERIODIC
WITHDRAWAL PROGRAM. AS USED HEREIN THE TERM '"SHARES" MEANS THE
AUTHORIZED AND ISSUED SHARES OF COMMON STOCK, OR SHARES OF BENEFICIAL
INTEREST, AS THE CASE MAY BE, FOR EACH FUND LISTED IN SCHEDULE A. IN
ACCORDANCE WITH PROCEDURES ESTABLISHED FROM TIME TO TIME BY AGREEMENT
BETWEEN THE TRANSFER AGENT AND THE BANK, THE BANK SHALL PROVIDE THE
SERVICES LISTED IN THIS SECTION 1.
(A) THE BANK SHALL:
(I) RECEIVE FOR ACCEPTANCE, ORDERS FOR THE
PURCHASE OF SHARES, AND PROMPTLY DELIVER PAYMENT AND
APPROPRIATE DOCUMENTATION THEREOF TO THE CUSTODIAN OF
EACH FUND AUTHORIZED PURSUANT TO THE ARTICLES OF
INCORPORATION OR ORGANIZATION OF EACH FUND (THE
"CUSTODIAN");
(II) PURSUANT TO PURCHASE ORDERS, ISSUE THE
APPROPRIATE NUMBER OF SHARES AND HOLD SUCH SHARES IN
THE APPROPRIATE SHAREHOLDER ACCOUNT;
(III) RECEIVE FOR ACCEPTANCE REDEMPTION REQUESTS
AND REDEMPTION DIRECTIONS AND DELIVER THE APPROPRIATE
DOCUMENTATION THEREOF TO THE CUSTODIAN;
(IV) IN RESPECT TO THE TRANSACTIONS IN ITEMS (I),
(II) AND (III) ABOVE, THE BANK SHALL EXECUTE
TRANSACTIONS DIRECTLY WITH BROKER-DEALERS AUTHORIZED
BY EACH FUND;
(V) AT THE APPROPRIATE TIME AS AND WHEN IT
RECEIVES MONIES PAID TO IT BY THE CUSTODIAN WITH
RESPECT TO ANY REDEMPTION, PAY OVER OR CAUSE TO BE
PAID OVER IN THE APPROPRIATE MANNER SUCH MONIES AS
INSTRUCTED BY THE REDEEMING SHAREHOLDERS;
(VI) EFFECT TRANSFERS OF SHARES BY THE REGISTERED
OWNERS THEREOF UPON RECEIPT OF APPROPRIATE
INSTRUCTIONS;
(VII) PREPARE AND TRANSMIT PAYMENTS FOR DIVIDENDS
AND DISTRIBUTIONS DECLARED BY EACH FUND;
(VIII) ISSUE REPLACEMENT CERTIFICATES FOR THOSE
CERTIFICATES ALLEGED TO HAVE BEEN LOST, STOLEN OR
DESTROYED UPON RECEIPT BY THE BANK OF INDEMNIFICATION
SATISFACTORY TO THE BANK AND PROTECTING THE BANK AND
EACH FUND, AND THE BANK AT ITS OPTION, MAY ISSUE
REPLACEMENT CERTIFICATES IN PLACE OF MUTILATED STOCK
CERTIFICATES UPON PRESENTATION THEREOF AND WITHOUT
SUCH INDEMNITY;
(IX) MAINTAIN RECORDS OF ACCOUNT FOR AND ADVISE
THE TRANSFER AGENT AND ITS SHAREHOLDERS AS TO THE
FOREGOING; AND
(X) RECORD THE ISSUANCE OF SHARES OF EACH FUND
AND MAINTAIN PURSUANT TO RULE 17AD-10(E) OF THE
SECURITIES EXCHANGE ACT OF 1934 AS AMENDED (THE
"EXCHANGE ACT OF 1934") A RECORD OF THE TOTAL NUMBER
OF SHARES OF EACH FUND WHICH ARE AUTHORIZED, BASED
UPON DATA PROVIDED TO IT BY EACH FUND OR THE TRANSFER
AGENT, AND ISSUED AND OUTSTANDING. THE BANK SHALL
ALSO PROVIDE EACH FUND ON A REGULAR BASIS WITH THE
TOTAL NUMBER OF SHARES WHICH ARE AUTHORIZED AND
ISSUED AND OUTSTANDING AND SHALL HAVE NO OBLIGATION,
WHEN RECORDING THE ISSUANCE OF SHARES, TO MONITOR THE
ISSUANCE OF SUCH SHARES OR TO TAKE COGNIZANCE OF ANY
LAWS RELATING TO THE ISSUE OR SALE OF SUCH SHARES,
WHICH FUNCTIONS SHALL BE THE SOLE RESPONSIBILITY OF
EACH FUND OR THE TRANSFER AGENT.
1.2 (A) FOR REPORTS, THE BANK SHALL:
(I) MAINTAIN ALL SHAREHOLDER ACCOUNTS, PREPARE
MEETING, PROXY, AND MAILING LISTS, WITHHOLD TAXES ON
US RESIDENT AND NON-RESIDENT ALIEN ACCOUNTS, PREPARE
AND FILE US TREASURY DEPARTMENT REPORTS REQUIRED WITH
RESPECT TO INTEREST, DIVIDENDS AND DISTRIBUTIONS BY
FEDERAL AUTHORITIES FOR ALL SHAREHOLDERS, PREPARE
CONFIRMATION FORMS AND STATEMENTS OF ACCOUNT TO
SHAREHOLDERS FOR ALL PURCHASES AND REDEMPTIONS OF
SHARES AND OTHER CONFIRMABLE TRANSACTIONS IN
SHAREHOLDER ACCOUNT INFORMATION.
(B) FOR BLUE SKY REPORTING THE BANK SHALL PROVIDE A
SYSTEM THAT WILL ENABLE EACH FUND OR THE TRANSFER AGENT TO
MONITOR THE TOTAL NUMBER OF SHARES SOLD IN EACH STATE, AND
EACH FUND OR THE TRANSFER AGENT SHALL:
(I) IDENTIFY TO THE BANK IN WRITING THOSE
TRANSACTIONS AND ASSETS TO BE TREATED AS EXEMPT FROM
BLUE SKY REPORTING FOR EACH STATE; AND
(II) VERIFY THE ESTABLISHMENT OF TRANSACTIONS FOR
EACH STATE ON THE SYSTEM PRIOR TO THE ACTIVITY FOR
EACH STATE, THE RESPONSIBILITY OF THE BANK FOR EACH
FUND'S BLUE SKY STATE REGISTRATION STATUS IS SOLELY
LIMITED TO THE INITIAL ESTABLISHMENT OF TRANSACTIONS
SUBJECT TO BLUE SKY COMPLIANCE BY THE FUND OR THE
TRANSFER AGENT AND THE REPORTING OF SUCH TRANSACTIONS
TO THE FUND AS PROVIDED ABOVE.
1.3 PER THE ATTACHED SERVICE RESPONSIBILITY SCHEDULE PROCEDURES AS
TO WHO SHALL PROVIDE CERTAIN OF THESE SERVICES IN SECTION 1 MAY BE
ESTABLISHED FROM TIME TO TIME BY AGREEMENT BETWEEN THE TRANSFER AGENT
AND THE BANK. THE BANK MAY AT TIMES PERFORM ONLY A PORTION OF THESE
SERVICES AND THE TRANSFER AGENT MAY PERFORM THESE SERVICES ON EACH
FUND'S BEHALF.
1.4 THE BANK SHALL PROVIDE ADDITIONAL SERVICES ON BEHALF OF THE
TRANSFER AGENT (I.E., ESCHEAT SERVICES) THAT MAY BE AGREED UPON IN
WRITING BETWEEN THE BANK AND THE TRANSFER AGENT.
2. FEES AND EXPENSES
2.1 FOR THE PERFORMANCE BY THE BANK PURSUANT TO THIS AGREEMENT,
THE TRANSFER AGENT AGREES TO PAY THE BANK AN ANNUAL MAINTENANCE FEE FOR
EACH SHAREHOLDER ACCOUNT AS SET OUT IN THE INITIAL FEE SCHEDULE
ATTACHED HERETO. SUCH FEES AND OUT-OF-POCKET EXPENSES AND ADVANCES
IDENTIFIED UNDER SECTION 2.2 BELOW MAY BE CHANGED FROM TIME TO TIME
SUBJECT TO MUTUAL WRITTEN AGREEMENT BETWEEN THE TRANSFER AGENT AND THE
BANK.
2.2 IN ADDITION TO THE FEE PAID UNDER SECTION 2.1 ABOVE, THE
TRANSFER AGENT AGREES TO REIMBURSE THE BANK FOR OUT-OF-POCKET EXPENSES,
INCLUDING, BUT NOT LIMITED TO CONFIRMATION PRODUCTION, POSTAGE, FORMS,
TELEPHONE, MICROFILM, MICROFICHE, TABULATING PROXIES, RECORDS STORAGE,
OR ADVANCES INCURRED BY THE BANK FOR THE ITEMS SET OUT IN THE FEE
SCHEDULE ATTACHED HERETO. IN ADDITION, ANY OTHER EXPENSES INCURRED BY
THE BANK AT THE REQUEST OR WITH THE CONSENT OF THE TRANSFER AGENT, WILL
BE REIMBURSED BY THE TRANSFER AGENT.
2.3 THE TRANSFER AGENT AGREES TO PAY ALL FEES AND REIMBURSABLE
EXPENSES WITHIN FIFTEEN DAYS FOLLOWING THE RECEIPT OF THE RESPECTIVE
BILLING NOTICE. POSTAGE FOR MAILING OF DIVIDENDS, PROXIES, FUND REPORTS
AND OTHER MAILINGS TO ALL SHAREHOLDER ACCOUNTS SHALL BE ADVANCED TO THE
BANK BY THE TRANSFER AGENT AT LEAST SEVEN (7) DAYS PRIOR TO THE MAILING
DATE OF SUCH MATERIALS.
3. WIRE TRANSFER OPERATING GUIDELINES/ARTICLES 4A OF THE UNIFORM
COMMERCIAL CODE
3.1 THE BANK IS AUTHORIZED TO PROMPTLY DEBIT THE APPROPRIATE
TRANSFER AGENT ACCOUNT(S) UPON THE RECEIPT OF A PAYMENT ORDER IN
COMPLIANCE WITH THE SELECTED SECURITY PROCEDURE (THE "SECURITY
PROCEDURE") CHOSEN FOR FUNDS TRANSFER AND IN THE AMOUNT OF MONEY THAT
THE BANK HAS BEEN INSTRUCTED TO TRANSFER. THE BANK SHALL EXECUTE
PAYMENT ORDERS IN COMPLIANCE WITH THE SECURITY PROCEDURE AND WITH THE
TRANSFER AGENT'S INSTRUCTIONS ON THE EXECUTION DATE PROVIDED THAT SUCH
PAYMENT ORDER IS RECEIVED BY THE CUSTOMARY DEADLINE FOR PROCESSING SUCH
A REQUEST, UNLESS THE PAYMENT ORDER SPECIFIES A LATER TIME. ALL PAYMENT
ORDERS AND COMMUNICATIONS RECEIVED AFTER THIS TIME FRAME WILL BE DEEMED
TO HAVE BEEN RECEIVED THE NEXT BUSINESS DAY.
3.2 THE TRANSFER AGENT ACKNOWLEDGES THAT THE SECURITY PROCEDURE IT
HAS DESIGNATED ON THE TRANSFER AGENT SELECTION FORM WAS SELECTED BY THE
TRANSFER AGENT FROM SECURITY PROCEDURES OFFERED BY THE BANK. THE
TRANSFER AGENT SHALL RESTRICT ACCESS TO CONFIDENTIAL INFORMATION
RELATING TO THE SECURITY PROCEDURE TO AUTHORIZED PERSONS AS
COMMUNICATED TO THE BANK IN WRITING. THE TRANSFER AGENT MUST NOTIFY THE
BANK IMMEDIATELY IF IT HAS REASON TO BELIEVE UNAUTHORIZED PERSONS MAY
HAVE OBTAINED ACCESS TO SUCH INFORMATION OR OF ANY CHANGE IN THE
TRANSFER AGENT'S AUTHORIZED PERSONNEL. THE BANK SHALL VERIFY THE
AUTHENTICITY OF ALL SUCH INSTRUCTIONS ACCORDING TO THE SECURITY
PROCEDURE.
3.3 THE BANK SHALL PROCESS ALL PAYMENT ORDERS ON THE BASIS OF THE
ACCOUNT NUMBER CONTAINED IN THE PAYMENT ORDER. IN THE EVENT OF A
DISCREPANCY BETWEEN ANY NAME INDICATED ON THE PAYMENT ORDER AND THE
ACCOUNT NUMBER, THE ACCOUNT NUMBER SHALL TAKE PRECEDENCE AND GOVERN.
3.4 WHEN A TRANSFER AGENT INITIATES OR RECEIVES AUTOMATED CLEARING
HOUSE ("ACH") CREDIT AND DEBIT ENTRIES PURSUANT TO THESE GUIDELINES AND
THE RULES OF THE NATIONAL AUTOMATED CLEARING HOUSE ASSOCIATION AND THE
NEW ENGLAND CLEARING HOUSE ASSOCIATION, THE BANK WILL ACT AS AN
ORIGINATING DEPOSITORY FINANCIAL INSTITUTION AND/OR RECEIVING
DEPOSITORY FINANCIAL INSTITUTION, AS THE CASE MAY BE, WITH RESPECT TO
SUCH ENTRIES. CREDITS GIVEN BY THE BANK WITH RESPECT TO AN ACH CREDIT
ENTRY ARE PROVISIONAL UNTIL THE BANK RECEIVES FINAL SETTLEMENT FOR SUCH
ENTRY FROM THE FEDERAL RESERVE BANK. IF THE BANK DOES NOT RECEIVE SUCH
FINAL SETTLEMENT, THE TRANSFER AGENT AGREES THAT THE BANK SHALL RECEIVE
A REFUND OF THE AMOUNT CREDITED TO THE TRANSFER AGENT IN CONNECTION
WITH SUCH ENTRY, AND THE PARTY MAKING PAYMENT TO THE TRANSFER AGENT VIA
SUCH ENTRY SHALL NOT BE DEEMED TO HAVE PAID THE AMOUNT OF THE ENTRY.
3.5 THE BANK RESERVES THE RIGHT TO DECLINE TO PROCESS OR DELAY THE
PROCESSING OF A PAYMENT ORDER WHICH (A) IS IN EXCESS OF THE COLLECTED
BALANCE IN THE ACCOUNT TO BE CHARGED AT THE TIME OF THE BANK'S RECEIPT
OF SUCH PAYMENT ORDER, OR (B) IF THE BANK, IN GOOD FAITH, IS UNABLE TO
SATISFY ITSELF THAT THE TRANSACTION HAS BEEN PROPERLY AUTHORIZED.
3.6 THE BANK SHALL USE REASONABLE EFFORTS TO ACT ON ALL AUTHORIZED
REQUESTS TO CANCEL OR AMEND PAYMENT ORDERS RECEIVED IF REQUESTS ARE
RECEIVED IN A TIMELY MANNER AFFORDING THE BANK REASONABLE OPPORTUNITY
TO ACT. HOWEVER, THE BANK ASSUMES NO LIABILITY IF THE REQUEST FOR
AMENDMENT OR CANCELLATION CANNOT BE SATISFIED.
3.7 THE BANK SHALL ASSUME NO RESPONSIBILITY FOR FAILURE TO DETECT
ANY ERRONEOUS PAYMENT ORDER PROVIDED THAT THE BANK COMPLIES WITH THE
PAYMENT ORDER INSTRUCTIONS AS RECEIVED AND THE BANK COMPLIES WITH THE
SECURITY PROCEDURE. THE SECURITY PROCEDURE IS ESTABLISHED FOR THE
PURPOSE OF AUTHENTICATING PAYMENT ORDERS ONLY AND NOT FOR THE DETECTION
OF ERRORS IN PAYMENT ORDERS.
3.8 THE BANK SHALL ASSUME NO RESPONSIBILITY FOR LOST INTEREST WITH
RESPECT TO THE RETRANSFER AGENTABLE AMOUNT OF ANY UNAUTHORIZED PAYMENT
ORDER UNLESS THE BANK IS NOTIFIED OF THE UNAUTHORIZED PAYMENT ORDER
WITHIN THIRTY (30) DAYS OF NOTIFICATION BY THE BANK OF THE ACCEPTANCE
OF SUCH PAYMENT ORDER. IN NO EVENT (INCLUDING FAILURE TO EXECUTE A
PAYMENT ORDER) SHALL THE BANK BE LIABLE FOR SPECIAL, INDIRECT OR
CONSEQUENTIAL DAMAGES, EVEN IF ADVISED OF THE POSSIBILITY OF SUCH
DAMAGES.
3.9 CONFIRMATION OF BANK'S EXECUTION OF PAYMENT ORDERS SHALL
ORDINARILY BE PROVIDED WITHIN 24 HOURS NOTICE OF WHICH MAY BE DELIVERED
THROUGH THE BANK'S PROPRIETARY INFORMATION SYSTEMS, OR BY FACSIMILE OR
CALL-BACK. CLIENT MUST REPORT ANY OBJECTIONS TO THE EXECUTION OF AN
ORDER WITHIN 30 DAYS.
4. DATA ACCESS AND PROPRIETARY INFORMATION
THE TRANSFER AGENT ACKNOWLEDGES THAT THE DATA BASES, COMPUTER PROGRAMS,
SCREEN FORMATS, REPORT FORMATS, INTERACTIVE DESIGN TECHNIQUES, AND
OTHER INFORMATION FURNISHED TO THE TRANSFER AGENT BY THE BANK ARE
PROVIDED SOLELY IN CONNECTION WITH THE SERVICES RENDERED UNDER THIS
AGREEMENT AND CONSTITUTE COPYRIGHTED TRADE SECRETS OR PROPRIETARY
INFORMATION OF SUBSTANTIAL VALUE TO THE BANK. SUCH DATABASES, PROGRAMS,
FORMATS, DESIGNS, TECHNIQUES AND OTHER INFORMATION ARE COLLECTIVELY
REFERRED TO BELOW AS "PROPRIETARY INFORMATION". THE TRANSFER AGENT
AGREES THAT IT SHALL TREAT ALL PROPRIETARY INFORMATION AS PROPRIETARY
TO THE BANK AND FURTHER AGREES THAT IT SHALL NOT DIVULGE ANY
PROPRIETARY INFORMATION TO ANY PERSON OR ORGANIZATION EXCEPT AS
EXPRESSLY PERMITTED HEREUNDER. THE TRANSFER AGENT AGREES FOR ITSELF AND
ITS EMPLOYEES AND AGENTS:
(A) TO USE SUCH PROGRAMS AND DATABASES (I) SOLELY ON THE
TRANSFER AGENT'S COMPUTERS, OR (II) SOLELY FROM EQUIPMENT AT
THE LOCATIONS AGREED TO BETWEEN THE TRANSFER AGENT AND THE
BANK AND (III) IN ACCORDANCE WITH THE BANK'S APPLICABLE USER
DOCUMENTATION;
(B) TO REFRAIN FROM COPYING OR DUPLICATING IN ANY WAY
(OTHER THAN IN THE NORMAL COURSE OF PERFORMING PROCESSING ON
THE TRANSFER AGENT'S COMPUTERS) ANY PART OF ANY PROPRIETARY
INFORMATION;
(C) TO REFRAIN FROM OBTAINING UNAUTHORIZED ACCESS TO ANY
PROGRAMS, DATA OR OTHER INFORMATION NOT OWNED BY THE TRANSFER
AGENT, AND IF SUCH ACCESS IS ACCIDENTALLY OBTAINED, TO RESPECT
AND SAFEGUARD THE SAME PROPRIETARY INFORMATION;
(D) TO REFRAIN FROM CAUSING OR ALLOWING PROPRIETARY
INFORMATION TRANSMITTED FROM THE BANK'S COMPUTER TO THE
TRANSFER AGENT'S TERMINAL TO BE RETRANSMITTED TO ANY OTHER
COMPUTER TERMINAL OR OTHER DEVICE EXCEPT AS EXPRESSLY
PERMITTED BY THE BANK, SUCH PERMISSION NOT TO BE UNREASONABLY
WITHHELD;
(E) THAT THE TRANSFER AGENT SHALL HAVE ACCESS ONLY TO
THOSE AUTHORIZED TRANSACTIONS AS AGREED TO BETWEEN THE
TRANSFER AGENT AND THE BANK; AND
(F) TO HONOR REASONABLE WRITTEN REQUESTS MADE BY THE BANK
TO PROTECT AT THE BANK'S EXPENSE THE RIGHTS OF THE BANK IN
PROPRIETARY INFORMATION AT COMMON LAW AND UNDER
APPLICABLE STATUTES.
EACH PARTY SHALL TAKE REASONABLE EFFORTS TO ADVISE ITS EMPLOYEES OF
THEIR OBLIGATIONS PURSUANT TO THIS SECTION 4.
5. INDEMNIFICATION
5.1 EXCEPT AS PROVIDED IN SECTION 6, HEREIN, THE BANK SHALL NOT BE
RESPONSIBLE FOR, AND THE TRANSFER AGENT SHALL INDEMNIFY AND HOLD THE
BANK HARMLESS FROM AND AGAINST, ANY AND ALL LOSSES, DAMAGES, COSTS,
CHARGES, COUNSEL FEES, PAYMENTS, EXPENSES AND LIABILITY ARISING OUT OF
OR ATTRIBUTABLE TO:
(A) ALL ACTIONS OF THE BANK OR ITS AGENT OR
SUBCONTRACTORS REQUIRED TO BE TAKEN PURSUANT TO THIS
AGREEMENT, PROVIDED THAT SUCH ACTIONS ARE TAKEN IN GOOD FAITH
AND WITHOUT NEGLIGENCE OR WILLFUL MISCONDUCT;
(B) THE TRANSFER AGENT'S LACK OF GOOD FAITH, NEGLIGENCE
OR WILLFUL MISCONDUCT;
(C) THE RELIANCE ON OR USE BY THE BANK OR ITS AGENTS OR
SUBCONTRACTORS OF INFORMATION, RECORDS, DOCUMENTS OR SERVICES
WHICH (I) ARE GIVEN TO THE BANK OR ITS AGENTS OR
SUBCONTRACTORS, AND (II) HAVE BEEN PREPARED, MAINTAINED OR
PERFORMED BY THE TRANSFER AGENT OR ANY OTHER PERSON OR FIRM ON
BEHALF OF THE TRANSFER AGENT INCLUDING BUT NOT LIMITED TO ANY
PREVIOUS TRANSFER AGENT OR REGISTRAR EXCLUDING THE BANK;
(D) THE RELIANCE ON, OR THE CARRYING OUT BY THE BANK OR
ITS AGENTS OR SUBCONTRACTORS OF ANY INSTRUCTIONS OR REQUESTS
OF THE TRANSFER AGENT; AND
(E) THE OFFER OR SALE OF SHARES IN VIOLATION OF ANY
REQUIREMENT UNDER THE FEDERAL SECURITIES LAWS OR REGULATIONS
OR THE SECURITIES LAWS OR REGULATIONS OF ANY STATE THAT SUCH
SHARES BE REGISTERED IN SUCH STATE OR IN VIOLATION OF ANY STOP
ORDER OR OTHER DETERMINATION OR RULING BY ANY FEDERAL AGENCY
OR ANY STATE WITH RESPECT TO THE OFFER OR SALE OF SUCH SHARES
IN SUCH STATE.
5.2 AT ANY TIME THE BANK MAY APPLY TO ANY OFFICER OF THE TRANSFER
AGENT FOR INSTRUCTIONS, AND MAY CONSULT WITH LEGAL COUNSEL WITH RESPECT
TO ANY MATTER ARISING IN CONNECTION WITH THE SERVICES TO BE PERFORMED
BY THE BANK UNDER THIS AGREEMENT, AND THE BANK AND ITS AGENTS OR
SUBCONTRACTORS SHALL NOT BE LIABLE AND SHALL BE INDEMNIFIED BY THE
TRANSFER AGENT FOR ANY ACTION TAKEN OR OMITTED BY IT IN RELIANCE UPON
SUCH INSTRUCTIONS OR UPON THE OPINION OF SUCH COUNSEL.
THE BANK, ITS AGENTS AND SUBCONTRACTORS SHALL BE PROTECTED AND
INDEMNIFIED IN ACTING UPON ANY PAPER OR DOCUMENT FURNISHED BY OR ON
BEHALF OF THE TRANSFER AGENT, REASONABLY BELIEVED BY THE BATIK AS BEING
IN GOOD ORDER AND TO HAVE BEEN SIGNED BY THE PROPER PERSON OR PERSONS,
OR UPON ANY INSTRUCTION, INFORMATION, DATA, RECORDS OR DOCUMENTS
PROVIDED THE BANK OR ITS AGENTS OR SUBCONTRACTORS BY MACHINE READABLE
INPUT, TELEX, CRT DATA ENTRY OR OTHER SIMILAR MEANS AUTHORIZED BY THE
TRANSFER AGENT, AND SHALL NOT BE HELD TO HAVE NOTICE OF ANY CHANGE OF
AUTHORITY OF ANY PERSON, UNTIL RECEIPT OF WRITTEN NOTICE THEREOF FROM
THE TRANSFER AGENT. THE BANK, ITS AGENTS AND SUBCONTRACTORS SHALL ALSO
BE PROTECTED AND INDEMNIFIED IN RECOGNIZING STOCK CERTIFICATES WHICH
ARE REASONABLY BELIEVED TO BEAR THE PROPER MANUAL OR FACSIMILE
SIGNATURES OF THE OFFICERS OF THE TRANSFER AGENT, AND THE PROPER
COUNTERSIGNATURE OF THE TRANSFER AGENT OR ANY FORMER TRANSFER AGENT OR
FORMER REGISTRAR, OR OF A CO-TRANSFER AGENT OR CO-REGISTRAR.
5.3 IN ORDER THAT THE INDEMNIFICATION PROVISIONS CONTAINED IN THIS
SECTION 5 SHALL APPLY, UPON THE ASSERTION OF A CLAIM FOR WHICH THE
TRANSFER AGENT MAY BE REQUIRED TO INDEMNIFY THE BANK, THE BANK SHALL
PROMPTLY NOTIFY THE TRANSFER AGENT OF SUCH ASSERTION, AND SHALL KEEP
THE TRANSFER AGENT ADVISED WITH RESPECT TO ALL DEVELOPMENTS CONCERNING
SUCH CLAIM. THE TRANSFER AGENT SHALL HAVE THE OPTION TO PARTICIPATE
WITH THE BANK IN THE DEFENSE OF SUCH CLAIM OR TO DEFEND AGAINST SAID
CLAIM IN ITS OWN NAME OR IN THE NAME OF THE BANK. THE BANK SHALL IN NO
CASE CONFESS ANY CLAIM OR MAKE ANY COMPROMISE IN ANY CASE IN WHICH THE
TRANSFER AGENT MAY BE REQUIRED TO INDEMNIFY THE BANK EXCEPT WITH THE
TRANSFER AGENT'S PRIOR WRITTEN CONSENT.
6. STANDARD OF CARE
6.1 THE BANK SHALL AT ALL TIMES ACT IN GOOD FAITH AND AGREES TO
USE ITS BEST EFFORTS WITHIN REASONABLE LIMITS TO INSURE THE ACCURACY OF
ALL SERVICES PERFORMED UNDER THIS AGREEMENT, BUT ASSUMES NO
RESPONSIBILITY AND SHALL NOT BE LIABLE FOR LOSS OR DAMAGE DUE TO ERRORS
UNLESS SAID ERRORS ARE CAUSED BY ITS NEGLIGENCE, BAD FAITH, OR WILLFUL
MISCONDUCT OR THAT OF ITS EMPLOYEES.
6.2 THE BANK SHALL WORK WITH THE TRANSFER AGENT TO ENSURE THAT A
FUND IS MADE WHOLE BY THE RESPONSIBLE PARTY FOR ANY MATERIAL LOSSES OR
DAMAGES RESULTING FROM ERRORS, MATERIAL UNRECONCILED ITEMS,
CARELESSNESS, NEGLIGENCE, BAD FAITH, OR WILLFUL MISCONDUCT BY THE BANK
OR ITS AGENTS OR SUBCONTRACTORS, OR THAT OF THEIR EMPLOYEES. NEITHER
THE BANK, ITS AGENTS OR SUBCONTRACTORS, NOR THE TRANSFER AGENT MAY
WAIVE FULL LIABILITY FOR LOSSES OR DAMAGES BASED ON THE ABOVE.
6.3 ERRORS IDENTIFIED AS CAUSED BY THE SUB-TRANSFER AGENT WILL NOT
BE CHARGED TO THE FUNDS IN THE MONTHLY BILLING.
7. COVENANTS OF THE TRANSFER AGENT AND THE BANK
7.1 THE BANK HEREBY AGREES TO ESTABLISH AND MAINTAIN FACILITIES
AND PROCEDURES REASONABLY ACCEPTABLE TO THE TRANSFER AGENT FOR
SAFEKEEPING OF STOCK CERTIFICATES, CHECK FORMS AND FACSIMILE SIGNATURE
IMPRINTING DEVICES, IF ANY; AND FOR THE PREPARATION OR USE, AND FOR
KEEPING ACCOUNT OF, SUCH CERTIFICATES, FORMS AND DEVICES.
7.2 THE BANK SHALL KEEP RECORDS RELATING TO THE SERVICES TO BE
PERFORMED HEREUNDER, IN THE FORM AND MANNER AS IT MAY DEEM ADVISABLE.
TO THE EXTENT REQUIRED BY SECTION 31 OF THE INVESTMENT COMPANY ACT OF
1940, AS AMENDED, AND THE RULES THEREUNDER, THE BANK AGREES THAT ALL
SUCH RECORDS PREPARED OR MAINTAINED BY THE BANK RELATING TO THE
SERVICES TO BE PERFORMED BY THE BANK HEREUNDER ARE THE PROPERTY OF THE
TRANSFER AGENT AND WILL BE PRESERVED, MAINTAINED AND MADE AVAILABLE IN
ACCORDANCE WITH SUCH SECTION AND RULES, AND WILL BE SURRENDERED
PROMPTLY TO THE TRANSFER AGENT ON AND IN ACCORDANCE WITH ITS REQUEST.
7.3 THE BANK AND THE TRANSFER AGENT AGREE THAT ALL BOOKS, RECORDS,
INFORMATION AND DATA PERTAINING TO THE BUSINESS OF THE OTHER PARTY
WHICH ARE EXCHANGED OR RECEIVED PURSUANT TO THE NEGOTIATION OR THE
CARRYING OUT OF THIS AGREEMENT SHALL REMAIN CONFIDENTIAL, AND SHALL NOT
BE VOLUNTARILY DISCLOSED TO ANY OTHER PERSON, EXCEPT AS MAY BE REQUIRED
BY LAW.
7.4 IN CASE OF ANY REQUESTS OR DEMANDS FOR THE INSPECTION OF THE
SHAREHOLDER RECORDS OF THE TRANSFER AGENT, THE BANK WILL ENDEAVOR TO
NOTIFY THE TRANSFER AGENT AND TO SECURE INSTRUCTIONS FROM AN AUTHORIZED
OFFICER OF THE TRANSFER AGENT AS TO SUCH INSPECTION. THE BANK RESERVES
THE RIGHT, HOWEVER, TO EXHIBIT THE SHAREHOLDER RECORDS TO ANY PERSON
WHENEVER IT IS ADVISED BY ITS COUNSEL THAT IT MAY BE HELD LIABLE FOR
THE FAILURE TO EXHIBIT THE SHAREHOLDER RECORDS TO SUCH PERSON.
8. REPRESENTATIONS AND WARRANTIES OF THE BANK
THE BANK REPRESENTS AND WARRANTS TO THE TRANSFER AGENT THAT:
(A) IT IS A TRUST COMPANY DULY ORGANIZED AND EXISTING AND
IN GOOD STANDING UNDER THE LAWS OF THE COMMONWEALTH OF
MASSACHUSETTS;
(B) IT IS DULY QUALIFIED TO CARRY ON ITS BUSINESS IN THE
COMMONWEALTH OF MASSACHUSETTS;
(C) IT IS EMPOWERED UNDER APPLICABLE LAWS AND BY ITS
CHARTER AND BY-LAWS TO ENTER INTO AND PERFORM THIS AGREEMENT;
(D) ALL REQUISITE CORPORATE PROCEEDINGS HAVE BEEN TAKEN
TO AUTHORIZE IT TO ENTER INTO AND PERFORM THIS AGREEMENT;
(E) IT HAS AND WILL CONTINUE TO HAVE ACCESS TO THE
NECESSARY FACILITIES, EQUIPMENT AND PERSONNEL TO PERFORM ITS
DUTIES AND OBLIGATIONS UNDER THIS AGREEMENT; AND
(F) IT IS REGISTERED AS A TRANSFER AGENT UNDO SECTION
17A(C)(2) OF THE EXCHANGE ACT.
9. REPRESENTATIONS AND WARRANTIES OF THE TRANSFER AGENT
THE TRANSFER AGENT REPRESENTS AND WARRANTS TO THE BANK THAT:
(A) IT IS A CORPORATION DULY ORGANIZED AND EXISTING AND
IN GOOD STANDING UNDER THE LAWS OF THE STATE OF DELAWARE;
(B) IT IS EMPOWERED UNDER APPLICABLE LAWS AND BY ITS
ARTICLES OF INCORPORATION AND BY-LAWS TO ENTER INTO AND
PERFORM THIS AGREEMENT;
(C) ALL CORPORATE PROCEEDINGS REQUIRED BY SAID ARTICLES
OF INCORPORATION AND BY-LAWS HAVE BEEN TAKEN TO AUTHORIZE IT
TO ENTER INTO AND PERFORM THIS AGREEMENT.
(D) IT IS REGISTERED AS A TRANSFER AGENT UNDER SECTION
17A(C)(2) OF THE EXCHANGE ACT.
10. TERMINATION OF AGREEMENT
10.1 THIS AGREEMENT SHALL CONTINUE FOR A PERIOD OF FIVE YEARS (THE
"INITIAL TERM") AND BE RENEWED OR TERMINATED AS STATED BELOW.
10.2 THIS AGREEMENT SHALL TERMINATE UPON THE TERMINATION OF THE
TRANSFER AGENCY AGREEMENT BETWEEN THE FUNDS AND THE TRANSFER AGENT.
10.3 THIS AGREEMENT MAY BE TERMINATED OR RENEWED AFTER THE INITIAL
TERM BY EITHER PARTY UPON NINETY (90) DAYS WRITTEN NOTICE TO THE OTHER.
10.4 SHOULD THE TRANSFER AGENT EXERCISE ITS RIGHT TO TERMINATE, ALL
REASONABLE OUT-OF-POCKET EXPENSES ASSOCIATED WITH THE MOVEMENT OF
RECORDS AND MATERIAL WILL BE BORNE BY THE TRANSFER AGENT. ADDITIONALLY,
THE BANK RESERVES THE RIGHT TO CHARGE FOR ANY OTHER REASONABLE EXPENSES
ASSOCIATED WITH SUCH TERMINATION AND/OR A CHARGE EQUIVALENT TO THE
AVERAGE OF THREE (3) MONTHS' FEES.
11. ASSIGNMENT
11.1 EXCEPT AS PROVIDED IN SECTION 11.3 BELOW, NEITHER THIS
AGREEMENT NOR ANY RIGHTS OR OBLIGATIONS HEREUNDER MAY BE ASSIGNED BY
EITHER PARTY WITHOUT THE WRITTEN CONSENT OF THE OTHER PARTY.
11.2 THIS AGREEMENT SHALL INURE TO THE BENEFIT OF AND BE BINDING
UPON THE PARTIES AND THEIR RESPECTIVE PERMITTED SUCCESSORS AND ASSIGNS.
11.3 THE BANK WILL, WITHOUT FURTHER CONSENT ON THE PART OF THE
TRANSFER AGENT, SUBCONTRACT FOR THE PERFORMANCE HEREOF WITH NATIONAL
FINANCIAL DATA SERVICES, INC., A SUBSIDIARY OF BFDS DULY REGISTERED AS
A TRANSFER AGENT PURSUANT TO SECTION 17A(C)(2) PROVIDED, HOWEVER, THAT
THE BANK SHALL BE AS FULLY RESPONSIBLE TO THE TRANSFER AGENT FOR THE
ACTS AND OMISSIONS OF ANY SUBCONTRACTOR AS IT IS FOR ITS OWN ACTS AND
OMISSIONS.
12. AMENDMENT
THIS AGREEMENT MAY BE AMENDED OR MODIFIED BY A WRITTEN AGREEMENT
EXECUTED BY BOTH PARTIES.
13. MASSACHUSETTS LAW TO APPLY
THIS AGREEMENT SHALL BE CONSTRUED AND THE PROVISIONS THEREOF
INTERPRETED UNDER AND IN ACCORDANCE WITH THE LAWS OF THE COMMONWEALTH
OF MASSACHUSETTS.
14. FORCE MAJEURE
IN THE EVENT EITHER PARTY IS UNABLE TO PERFORM ITS OBLIGATIONS UNDER
THE TERMS OF THIS AGREEMENT BECAUSE OF ACTS OF GOD, STRIKES, EQUIPMENT
OR TRANSMISSION FAILURE OR DAMAGE REASONABLY BEYOND ITS CONTROL, OR
OTHER CAUSES REASONABLY BEYOND ITS CONTROL, SUCH PARTY SHALL NOT BE
LIABLE FOR DAMAGES TO THE OTHER FOR ANY DAMAGES RESULTING FROM SUCH
FAILURE TO PERFORM OR OTHERWISE FROM SUCH CAUSES.
15. CONSEQUENTIAL DAMAGES
NEITHER PARTY TO THIS AGREEMENT SHALL BE LIABLE TO THE OTHER PARTY FOR
CONSEQUENTIAL DAMAGES UNDER ANY PROVISION OF THIS AGREEMENT OR FOR ANY
CONSEQUENTIAL DAMAGES ARISING OUT OF ANY ACT OR FAILURE TO ACT
HEREUNDER.
16. LIMITATIONS OF SHAREHOLDER LIABILITY
EACH PARTY HEREBY EXPRESSLY ACKNOWLEDGES THAT RECOURSE AGAINST THE
FUNDS SHALL BE SUBJECT TO THOSE LIMITATIONS PROVIDED BY GOVERNING LAW
AND THE DECLARATION OF TRUST OR ARTICLES OF INCORPORATION OF THE FUNDS,
AS APPLICABLE, AND AGREES THAT OBLIGATIONS ASSUMED BY THE FUNDS
PURSUANT TO THE TRANSFER AGENCY AGREEMENT SHALL BE LIMITED IN ALL CASES
TO THE FUNDS AND THEIR RESPECTIVE ASSETS. EACH PARTY SHALL NOT SEEK
SATISFACTION FROM THE SHAREHOLDERS OR ANY INDIVIDUAL SHAREHOLDER OF THE
FUNDS, NOR SHALL ANY PARTY SEEK SATISFACTION OF ANY OBLIGATIONS FROM
THE DIRECTORS\TRUSTEES OR ANY INDIVIDUAL DIRECTOR\TRUSTEE OF THE FUNDS.
17. MERGER OF AGREEMENT
THIS AGREEMENT CONSTITUTES THE ENTIRE AGREEMENT BETWEEN THE PARTIES
HERETO AND SUPERSEDES ANY PRIOR AGREEMENT WITH RESPECT TO THE SUBJECT
MATTER HEREOF WHETHER ORAL OR WRITTEN.
18. SURVIVAL
ALL PROVISIONS REGARDING INDEMNIFICATION, WARRANTY, LIABILITY, AND
LIMITS THEREON, AND CONFIDENTIALITY AND/OR PROTECTION OF PROPRIETARY
RIGHTS AND TRADE SECRETS SHALL SURVIVE THE TERMINATION OF THIS
AGREEMENT.
19. SEVERABILITY
IF ANY PROVISION OR PROVISIONS OF THIS AGREEMENT SHALL BE HELD INVALID,
UNLAWFUL, OR UNENFORCEABLE, THE VALIDITY, LEGALITY AND ENFORCEABILITY
OF THE REMAINING PROVISIONS SHALL NOT IN ANY WAY BE AFFECTED OR
IMPAIRED.
20. COUNTERPARTS
THIS AGREEMENT MAY BE EXECUTED BY THE PARTIES HERETO ON ANY NUMBER OF
COUNTERPARTS, AND ALL OF SAID COUNTERPARTS TAKEN TOGETHER SHALL BE
DEEMED TO CONSTITUTE ONE AND THE SAME INSTRUMENT.
IN WITNESS WHEREOF, THE PARTIES HERETO HAVE CAUSED THIS AGREEMENT TO BE
EXECUTED IN THEIR NAMES AND ON THEIR BEHALF BY AND THROUGH THEIR DULY
AUTHORIZED OFFICERS, AS OF THE DAY FIRST WRITTEN ABOVE.
CALVERT SHAREHOLDER SERVICES, INC.
BY: /S/ KAREN BECKER
TITLE: VICE PRESIDENT
ATTEST: KATHERINE STONER
STATE STREET BANK AND TRUST COMPANY
BY: /S/ RONALD E. LOGUE
TITLE: EXECUTIVE VICE PRESIDENT
ATTEST: FRANCINE HAYES
<PAGE>
AMENDMENT TO SUB-TRANSFER AGENCY AND SERVICE AGREEMENT
BETWEEN
CALVERT SHAREHOLDER SERVICES, INC.
AND
STATE STREET BANK AND TRUST COMPANY
GENERAL BACKGROUND:
CALVERT SHAREHOLDER SERVICES, INC. ("CSSI"), AND STATE STREET BANK AND
TRUST COMPANY ("STATE STREET") ENTERED INTO A SUB-TRANSFER AGENCY AND
SERVICE AGREEMENT ("AGREEMENT") DATED AUGUST 15, 1996.
FOR ACCOUNTING REASONS, CSSI DESIRES TO AMEND THE AGREEMENT BY
ASSIGNING THE CONTRACT FOR THE TRANSFER AGENT FUNCTIONS (EXCEPT FOR
SHAREHOLDER SERVICING) TO EACH CALVERT GROUP FUND. CSSI WILL CONTINUE
TO BE RESPONSIBLE FOR THE SHAREHOLDER SERVICING AND FOR ANY
RESPONSIBILITIES CURRENTLY SHOWN AS TRANSFER AGENT RESPONSIBILITIES IN
FUND SERVICE RESPONSIBILITIES ATTACHMENT TO THE AGREEMENT.
THE AGREEMENT MUST BE ASSIGNED TO THE CALVERT GROUP FUNDS FOR
ACCOUNTING PURPOSES.
CSSI AND STATE STREET MUST EACH CONSENT TO THIS ASSIGNMENT.
CHANGES CAUSED BY THIS ASSIGNMENT:
THE CURRENT SUBTRANSFER AGENT, NATIONAL FINANCIAL DATA SERVICES, INC.
("NFDS"), WILL BILL EACH CALVERT GROUP FUND, RATHER THAN CSSI, AND EACH
CALVERT GROUP FUND SHALL PAY STATE STREET OR ITS BILLING AGENT, NFDS,
ALL FEES AND EXPENSES INCURRED UNDER THE AGREEMENT ON BEHALF OF EACH
RESPECTIVE CALVERT GROUP FUND.
NFDS WILL BE SHOWN IN EACH CALVERT GROUP FUND PROSPECTUS AND STATEMENT
OF ADDITIONAL INFORMATION AS THE TRANSFER AGENT, WHILE CSSI WILL BE
SHOWN AS THE SHAREHOLDER SERVICING AGENT.
STATE STREET (NFDS) WILL CONTINUE TO PERFORM THOSE FUNCTIONS SHOWN IN
THE AGREEMENT AS BANK RESPONSIBILITIES.
CSSI WILL CONTINUE TO PERFORM THE TRANSFER AGENT RESPONSIBILITIES, AS
SHOWN IN THE FUND SERVICE RESPONSIBILITIES ATTACHMENT TO THE AGREEMENT.
THE ASSIGNMENT:
THIS AMENDMENT, DATED AS OF THE FIRST DAY OF JANUARY, 1998, BY AND
AMONG CSSI AND STATE STREET:
NOW, THEREFORE, CSSI AND STATE STREET EACH HEREBY AGREE THAT THE
AGREEMENT WILL BE BETWEEN EACH CALVERT GROUP FUND AND STATE STREET, AND
EACH HEREBY AGREES THAT THE AGREEMENT IS SO ASSIGNED.
IN WITNESS WHEREOF, CSSI AND STATE STREET HAVE CAUSED THIS AMENDMENT TO
BE EXECUTED BY THEIR DULY AUTHORIZED OFFICERS, EFFECTIVE AS OF JANUARY
1, 1998.
CALVERT SHAREHOLDER SERVICES, INC. STATE
STREET BANK AND TRUST COMPANY
BY: /S/ BY: /S/
NAME: KAREN BECKER NAME: RONALD E. LOGUE
TITLE: VICE PRESIDENT, OPERATIONS TITLE: EXECUTIVE VICE PRESIDENT
DATE: FEBRUARY 18, 1998 DATE: FEBRUARY 20, 1998
ACACIA CAPITAL CORPORATION
FIRST VARIABLE RATE FUND
CALVERT TAX-FREE RESERVES
CALVERT SOCIAL INVESTMENT FUND
CALVERT CASH RESERVES
THE CALVERT FUND BY: /S/
CALVERT MUNICIPAL FUND, INC. NAME: WILLIAM M. TARTIKOFF
CALVERT WORLD VALUES FUND, INC. TITLE: SENIOR VICE PRESIDENT AND SECRETARY
CALVERT NEW WORLD FUND, INC. DATE: FEBRUARY 18, 1998
SERVICING AGREEMENT
THIS AGENCY AGREEMENT, EFFECTIVE JANUARY 1, 1998, BY AND BETWEEN CALVERT
SHAREHOLDER SERVICES, INC., A DELAWARE CORPORATION HAVING ITS PRINCIPAL PLACE OF
BUSINESS IN BETHESDA, MARYLAND ("CSS"), AND REGISTERED INVESTMENT COMPANIES
SPONSORED BY CALVERT GROUP, LTD. AND ITS SUBSIDIARIES AND SET FORTH ON SCHEDULE
A ("CALVERT GROUP FUNDS" OR "FUNDS"). THE FUNDS HAVE ENTERED INTO A TRANSFER
AGENCY AND SERVICE AGREEMENT WITH THE STATE STREET BANK AND TRUST OF BOSTON,
MASSACHUSETTS ("STATE STREET") ("STATE STREET AGREEMENT").
1. APPOINTMENTS. THE FUNDS HEREBY APPOINTS CSS AS SERVICING AGENT,
AGENT AND SHAREHOLDER SERVICING AGENT FOR THE FUNDS, AND CSS HEREBY ACCEPTS SUCH
APPOINTMENT AND AGREES TO PERFORM THOSE DUTIES IN ACCORDANCE WITH THE TERMS AND
CONDITIONS SET FORTH IN THIS AGREEMENT.
2. DOCUMENTATION. THE FUNDS WILL FURNISH CSS WITH ALL DOCUMENTS,
CERTIFICATES, CONTRACTS, FORMS, AND OPINIONS WHICH CSS, IN ITS DISCRETION, DEEMS
NECESSARY OR APPROPRIATE IN CONNECTION WITH THE PROPER PERFORMANCE OF ITS DUTIES
UNDER THIS AGREEMENT.
3. SERVICES TO BE PERFORMED. CSS WILL BE RESPONSIBLE FOR TELEPHONE
SERVICING FUNCTIONS, SYSTEM INTERFACE WITH STATE STREET AND OVERSIGHT OF STATE
STREET'S ADMINISTERING AND PERFORMING THEIR DUTIES PURSUANT TO THE STATE STREET
AGREEMENT. THE DETAILS OF THE OPERATING STANDARDS AND PROCEDURES TO BE FOLLOWED
WILL BE DETERMINED FROM TIME TO TIME BY AGREEMENT BETWEEN CSS AND THE FUNDS.
4. RECORDKEEPING AND OTHER INFORMATION. CSS WILL, COMMENCING ON THE
EFFECTIVE DATE OF THIS AGREEMENT, TO THE EXTENT NECESSARY CREATE AND MAINTAIN
ALL NECESSARY SHAREHOLDER ACCOUNTING RECORDS IN ACCORDANCE WITH ALL APPLICABLE
LAWS, RULES AND REGULATIONS, INCLUDING BUT NOT LIMITED TO RECORDS REQUIRED BY
SECTION 31(A) OF THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED (THE "1940
ACT"), AND THE RULES THEREUNDER, AS AMENDED FROM TIME TO TIME. ALL SUCH RECORDS
WILL BE THE PROPERTY OF THE FUND AND WILL BE AVAILABLE FOR INSPECTION AND USE BY
SUCH FUND.
5. AUDIT, INSPECTION AND VISITATION. CSS WILL MAKE AVAILABLE DURING
REGULAR BUSINESS HOURS ALL RECORDS AND OTHER DATA CREATED AND MAINTAINED
PURSUANT TO THIS AGREEMENT FOR REASONABLE AUDIT AND INSPECTION BY THE SEC, A
FUND OR ANY PERSON RETAINED BY A FUND.
6. COMPENSATION. THE FUNDS WILL COMPENSATE CSS ON A MONTHLY BASIS FOR
THE SERVICES PERFORMED PURSUANT TO THIS AGREEMENT, AT THE RATE OF COMPENSATION
SET FORTH IN SCHEDULE A. OUT OF POCKET EXPENSES INCURRED BY CSS AND NOT
INCLUDED IN SCHEDULE A WILL BE REIMBURSED TO CSS BY THE FUND, AS APPROPRIATE;
SUCH EXPENSES MAY INCLUDE, BUT ARE NOT LIMITED TO, SPECIAL FORMS AND POSTAGE FOR
MAILING THE FORMS. THESE CHARGES WILL BE PAYABLE IN FULL UPON RECEIPT OF A
BILLING INVOICE. IN LIEU OF REIMBURSING CSS FOR THESE EXPENSES, ANY FUND MAY,
IN ITS DISCRETION, DIRECTLY PAY THE EXPENSES.
7. USE OF NAMES. NO FUND WILL NOT USE THE NAME OF CSS IN ANY
PROSPECTUS, SALES LITERATURE OR OTHER MATERIAL RELATING TO THE FUND IN ANY
MANNER WITHOUT PRIOR APPROVAL BY CSS; PROVIDED, HOWEVER, THAT CSS WILL APPROVE
ALL USES OF ITS NAME THAT MERELY REFER IN ACCURATE TERMS TO ITS APPOINTMENT
UNDER THIS AGREEMENT OR THAT ARE REQUIRED BY THE SEC OR A STATE SECURITIES
COMMISSION; AND, PROVIDED, FURTHER, THAT IN NO EVENT WILL APPROVAL BE
UNREASONABLY WITHHELD.
8. SECURITY. CSS REPRESENTS AND WARRANTS THAT, TO THE BEST OF ITS
KNOWLEDGE, THE VARIOUS PROCEDURES AND SYSTEMS THAT CSS PROPOSES TO IMPLEMENT
WITH REGARD TO SAFEGUARDING FROM LOSS OR DAMAGE ATTRIBUTABLE TO FIRE, THEFT OR
ANY OTHER CAUSE (INCLUDING PROVISION FOR TWENTY-FOUR HOUR A DAY RESTRICTED
ACCESS) THE FUND'S, RECORDS AND OTHER DATA AND CSS'S RECORDS, DATA, EQUIPMENT,
FACILITIES AND OTHER PROPERTY USED IN THE PERFORMANCE OF ITS OBLIGATIONS UNDER
THIS AGREEMENT ARE ADEQUATE AND THAT IT WILL IMPLEMENT THEM IN THE MANNER
PROPOSED AND MAKE SUCH CHANGES FROM TIME TO TIME AS IN ITS JUDGMENT ARE REQUIRED
FOR THE SECURE PERFORMANCE OF OBLIGATIONS UNDER THIS AGREEMENT.
9. LIMITATION OF LIABILITY. EACH FUND WILL INDEMNIFY AND HOLD CSS
HARMLESS AGAINST ANY LOSSES, CLAIMS, DAMAGES, LIABILITIES OR EXPENSES (INCLUDING
REASONABLE COUNSEL FEES AND EXPENSES) RESULTING FROM ANY CLAIM, DEMAND, ACTION
OR SUIT BROUGHT BY ANY PERSON (INCLUDING A SHAREHOLDER NAMING SUCH FUND AS A
PARTY) OTHER THAN SUCH FUND NOT RESULTING FROM CSS'S BAD FAITH, WILLFUL
MISFEASANCE, RECKLESS DISREGARD OF ITS OBLIGATIONS AND DUTIES, OR NEGLIGENCE
ARISING OUT OF, OR IN CONNECTION WITH, CSS'S PERFORMANCE OF ITS OBLIGATIONS
UNDER THIS AGREEMENT.
TO THE EXTENT CSS HAS NOT ACTED WITH BAD FAITH, WILLFUL MISFEASANCE,
RECKLESS DISREGARD OF ITS OBLIGATIONS AND DUTIES, OR GROSS NEGLIGENCE, EACH FUND
WILL ALSO INDEMNIFY AND HOLD CSS HARMLESS AGAINST ANY LOSSES, CLAIMS, DAMAGES,
LIABILITIES OR EXPENSES (INCLUDING REASONABLE COUNSEL FEES AND EXPENSES)
RESULTING FROM ANY CLAIM, DEMAND, ACTION OR SUIT RESULTING FROM THE NEGLIGENCE
OF SUCH FUND, OR CSS'S ACTING UPON ANY INSTRUCTIONS REASONABLY BELIEVED BY IT TO
HAVE BEEN EXECUTED OR COMMUNICATED BY ANY PERSON DULY AUTHORIZED BY SUCH FUND,
OR AS A RESULT OF CSS'S ACTING IN RELIANCE UPON ADVICE REASONABLY BELIEVED BY
CSS TO HAVE BEEN GIVEN BY COUNSEL FOR THE FUND, OR AS A RESULT OF CSS'S ACTING
IN RELIANCE UPON ANY INSTRUMENT REASONABLY BELIEVED BY IT TO HAVE BEEN GENUINE
AND SIGNED, COUNTERSIGNED OR EXECUTED BY THE PROPER PERSON.
CSS'S LIABILITY FOR ANY AND ALL CLAIMS OF ANY KIND, INCLUDING NEGLIGENCE,
FOR ANY LOSS OR DAMAGE ARISING OUT OF, CONNECTED WITH, OR RESULTING FROM THIS
AGREEMENT, OR FROM THE PERFORMANCE OR BREACH THEREOF, OR FROM THE DESIGN,
DEVELOPMENT, LEASE, REPAIR, MAINTENANCE, OPERATION OR USE OF DATA PROCESSING
SYSTEMS AND THE MAINTENANCE OF A FUNDS' SHAREHOLDER ACCOUNT RECORDS AS PROVIDED
FOR BY THIS AGREEMENT WILL IN THE AGGREGATE NOT EXCEED THE TOTAL OF CSS'S
COMPENSATION HEREUNDER FOR THE SIX MONTHS IMMEDIATELY PRECEDING THE DISCOVERY OF
THE CIRCUMSTANCES GIVING RISE TO SUCH LIABILITY.
IN NO EVENT WILL CSS BE LIABLE FOR INDIRECT, SPECIAL, OR CONSEQUENTIAL
DAMAGES (EVEN IF CSS HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES)
ARISING FROM THE OBLIGATIONS ASSUMED HEREUNDER AND THE SERVICES PROVIDED FOR BY
THIS AGREEMENT, INCLUDING BUT NOT LIMITED TO LOST PROFITS, LOSS OF USE OF THE
SHAREHOLDER ACCOUNTING SYSTEM, COST OF CAPITAL, COST OF SUBSTITUTE FACILITIES,
PROGRAMS OR SERVICES, DOWNTIME COSTS, OR CLAIMS OF SHAREHOLDERS FOR SUCH DAMAGE.
10. LIMITATION OF LIABILITY OF THE FUND. CSS ACKNOWLEDGES THAT IT
ACCEPTS THE LIMITATIONS UPON THE LIABILITY OF THE FUNDS. CSS AGREES THAT EACH
FUND'S OBLIGATIONS UNDER THIS AGREEMENT IN ANY CASE WILL BE LIMITED TO SUCH FUND
AND TO ITS ASSETS AND THAT CSS WILL NOT SEEK SATISFACTION OF ANY OBLIGATION FROM
THE SHAREHOLDERS OF THE FUND NOR FROM ANY DIRECTOR, TRUSTEE, OFFICER, EMPLOYEE
OR AGENT OF SUCH FUND.
11. FORCE MAJEURE. CSS WILL NOT BE LIABLE FOR DELAYS OR ERRORS
OCCURRING BY REASON OF CIRCUMSTANCES BEYOND ITS CONTROL, INCLUDING BUT NOT
LIMITED TO ACTS OF CIVIL OR MILITARY AUTHORITY, NATIONAL EMERGENCIES, WORK
STOPPAGES, FIRE, FLOOD, CATASTROPHE, ACTS OF GOD, INSURRECTION, WAR, RIOT, OR
FAILURE OF COMMUNICATION OR POWER SUPPLY. IN THE EVENT OF EQUIPMENT BREAKDOWNS
BEYOND ITS CONTROL, CSS WILL TAKE REASONABLE STEPS TO MINIMIZE SERVICE
INTERRUPTIONS BUT WILL HAVE NO LIABILITY WITH RESPECT THERETO.
12. AMENDMENTS. CSS AND EACH FUND WILL REGULARLY CONSULT WITH EACH
OTHER REGARDING CSS'S PERFORMANCE OF ITS OBLIGATIONS UNDER THIS AGREEMENT. ANY
CHANGE IN A FUND'S REGISTRATION STATEMENTS UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR THE 1940 ACT OR IN THE FORMS RELATING TO ANY PLAN, PROGRAM OR
SERVICE OFFERED BY THE CURRENT PROSPECTUS WHICH WOULD REQUIRE A CHANGE IN CSS'S
OBLIGATIONS UNDER THIS AGREEMENT WILL BE SUBJECT TO CSS'S APPROVAL, WHICH WILL
NOT BE UNREASONABLY WITHHELD. NEITHER THIS AGREEMENT NOR ANY OF ITS PROVISIONS
MAY BE CHANGED, WAIVED, DISCHARGED, OR TERMINATED ORALLY, BUT ONLY BY WRITTEN
INSTRUMENT WHICH WILL MAKE SPECIFIC REFERENCE TO THIS AGREEMENT AND WHICH WILL
BE SIGNED BY THE PARTY AGAINST WHICH ENFORCEMENT OF SUCH CHANGE, WAIVER,
DISCHARGE OR TERMINATION IS SOUGHT.
13. TERMINATION. THIS AGREEMENT WILL CONTINUE IN EFFECT UNTIL JANUARY
1, 1999, AND THEREAFTER AS THE PARTIES MAY MUTUALLY AGREE; PROVIDED, HOWEVER,
THAT THIS AGREEMENT MAY BE TERMINATED AT ANY TIME BY EITHER PARTY UPON AT LEAST
SIXTY DAYS' PRIOR WRITTEN NOTICE TO THE OTHER PARTY; AND PROVIDED FURTHER THAT
THIS AGREEMENT MAY BE TERMINATED IMMEDIATELY AT ANY TIME FOR CAUSE EITHER BY ANY
FUND OR CSS IN THE EVENT THAT SUCH CAUSE REMAINS UNREMEDIED FOR NO LESS THAN
NINETY DAYS AFTER RECEIPT OF WRITTEN SPECIFICATION OF SUCH CAUSE. ANY SUCH
TERMINATION WILL NOT AFFECT THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER
PARAGRAPHS 9 AND 10 HEREOF. IN THE EVENT THAT A FUND DESIGNATES A SUCCESSOR TO
ANY OF CSS'S OBLIGATIONS HEREUNDER, CSS WILL, AT THE EXPENSE AND DIRECTION OF
SUCH FUND, TRANSFER TO SUCH SUCCESSOR ALL RELEVANT BOOKS, RECORDS AND OTHER DATA
OF SUCH FUND ESTABLISHED OR MAINTAINED BY CSS UNDER THIS AGREEMENT.
15. MISCELLANEOUS. EACH PARTY AGREES TO PERFORM SUCH FURTHER ACTS AND
EXECUTE SUCH FURTHER DOCUMENTS AS ARE NECESSARY TO EFFECTUATE THE PURPOSES OF
THIS AGREEMENT. THIS AGREEMENT WILL BE CONSTRUED AND ENFORCED IN ACCORDANCE
WITH AND GOVERNED BY THE LAWS OF THE STATE OF MARYLAND. THE CAPTIONS IN THIS
AGREEMENT ARE INCLUDED FOR CONVENIENCE ONLY AND IN NO WAY DEFINE OR DELIMIT ANY
OF THE PROVISIONS HEREOF OR OTHERWISE AFFECT THEIR CONSTRUCTION OR EFFECT.
IN WITNESS WHEREOF, THE PARTIES HAVE DULY EXECUTED THIS AGREEMENT AS OF THE
DAY AND YEAR FIRST ABOVE WRITTEN.
CALVERT GROUP FUNDS
BY:
CALVERT SHAREHOLDER SERVICES, INC.
BY:
<PAGE>
SERVICING AGREEMENT
SCHEDULE A
FOR ITS SERVICES UNDER THIS SERVICING AGREEMENT, CALVERT SHAREHOLDER
SERVICES, INC., IS ENTITLED TO RECEIVE FROM THE CALVERT FUNDS (EXCEPT ACACIA
CAPITAL CORPORATION) FEES AS SET FORTH BELOW:
FUND AND PORTFOLIO ANNUAL ACCOUNT FEE*FOOT1 ACCOUNT FEES ARE
CHARGED MONTHLY BASED ON THE HIGHEST NUMBER OF NON-ZERO BALANCE ACCOUNTS
OUTSTANDING DURING THE MONTH. TRANSACTION FEE
FIRST VARIABLE RATE FUND
FIRST VARIABLE RATE FUND (D/B/A CALVERT FIRST $11.59 $.84
GOVERNMENT MONEY MARKET)
CALVERT TAX-FREE RESERVES
MONEY MARKET 13.35 .97
LIMITED-TERM 3.67 .42
LONG-TERM 2.67 .31
CALIFORNIA MONEY MARKET 12.74 .93
VERMONT MUNICIPAL 3.40 .39
CALVERT MUNICIPAL FUND, INC
CALIFORNIA INTERMEDIATE 3.48 .40
NATIONAL INTERMEDIATE 3.31 .38
MARYLAND INTERMEDIATE 4.64 .53
VIRGINIA INTERMEDIATE 3.35 .38
CALVERT CASH RESERVES
INSTITUTIONAL PRIME FUND 11.83 .86
<PAGE>
THE CALVERT FUND
INCOME 4.22 .48
NEW VISION SMALL CAP 5.90 .67
CALVERT SOCIAL INVESTMENT FUND
MONEY MARKET 11.92 .87
BOND 4.85 .55
MANAGED GROWTH 4.63 .53
EQUITY 5.24 .60
MANAGED INDEX 5.24 .60
CALVERT WORLD VALUES FUND, INC.
INTERNATIONAL EQUITY 5.36 .61
CAPITAL ACCUMULATION 6.26 .72
CALVERT NEW WORLD FUND
NEW AFRICA FUND 3.91 .45
ACACIA CAPITAL CORPORATION FEE IS AS FOLLOW:
.03% (THREE BASIS POINTS) ON THE FIRST $500 MILLION OF AVERAGE NET ASSETS
AND .02% (TWO BASIS POINTS) OVER $500 MILLION OF AVERAGE NET ASSETS, MINUS THE
FEES PAID BY ACACIA CAPITAL CORPORATION TO STATE STREET BANK AND TRUST PURSUANT
TO THE STATE STREET AGREEMENT (EXCEPT FOR OUT OF POCKET EXPENSES).
RESTATED JULY 1998
E:\AGREEMENTS\MULTI FUND AGMTS\CG OF FUNDS SERVICING _AGRMT_.DOC
*
Page 3
ADMINISTRATIVE SERVICES AGREEMENT
ADMINISTRATIVE SERVICES AGREEMENT, MADE AS OF AUGUST 7, 1996, BY AND
BETWEEN CALVERT ADMINISTRATIVE SERVICES COMPANY, A DELAWARE CORPORATION
("CASC"), AND CALVERT CASH RESERVES, ORGANIZED AS A MASSACHUSETTS BUSINESS TRUST
(THE "FUND"), BOTH HAVING THEIR PRINCIPAL PLACE OF BUSINESS AT 4550 MONTGOMERY
AVENUE, BETHESDA, MARYLAND.
THE PARTIES TO THIS AGREEMENT, INTENDING TO BE LEGALLY BOUND, AGREE WITH
EACH OTHER AS FOLLOWS:
1. PROVISION OF SERVICES. CASC HEREBY UNDERTAKES TO THE FUND'S SERIES,
AS DESIGNATED IN SCHEDULE A, WITH CERTAIN ADMINISTRATIVE SERVICES THAT MAY BE
REQUIRED IN THE CONDUCT OF BUSINESS. SUCH SERVICES INCLUDE, BUT ARE NOT LIMITED
TO, MAINTAINING THE FUND'S ORGANIZATIONAL EXISTENCE, PREPARING THE SERIES'
PROSPECTUSES, PREPARING NOTICES, PROXY MATERIALS, REPORTS TO REGULATORY BODIES
AND REPORTS TO SHAREHOLDERS OF THE SERIES, DETERMINING THE DAILY NET ASSET VALUE
OF SHARES, DETERMINING THE AMOUNT OF DAILY DIVIDENDS OF NET INVESTMENT INCOME
PER SHARE, KEEPING THE BOOKS AND RECORDS, AND SUCH OTHER INCIDENTAL
ADMINISTRATIVE SERVICES AS ARE NECESSARY TO THE CONDUCT OF THE FUND'S AFFAIRS,
RELATIVE TO THE SERIES DESIGNATED IN SCHEDULE A. THE FUND HEREBY ENGAGES CASC TO
PROVIDE IT WITH SUCH SERVICES, OR TO CAUSE SUCH SERVICES TO BE PROVIDED TO THE
FUND BY THIRD PARTIES.
2. SCOPE OF AUTHORITY. CASC IS AT ALL TIMES, IN THE PERFORMANCE OF ITS
FUNCTIONS UNDER THIS AGREEMENT, SUBJECT TO ANY DIRECTION AND CONTROL OF THE
TRUSTEES OF THE FUND AND OF ITS OFFICERS, AND TO THE TERMS OF ITS DECLARATION OF
TRUST AND BYLAWS, EXCEPT THAT IT HAS NO OBLIGATION TO PROVIDE TO THE FUND ANY
SERVICES THAT ARE CLEARLY OUTSIDE THE SCOPE OF THOSE CONTEMPLATED IN THIS
AGREEMENT. IN THE PERFORMANCE OF ITS DUTIES UNDER THIS AGREEMENT, CASC IS
AUTHORIZED TO TAKE ANY ACTION IT DEEMS ADVISABLE. CASC MAY CONTRACT WITH OTHER
PERSONS TO PROVIDE TO THE FUND ANY OF THE SERVICES CONTEMPLATED UNDER THE
AGREEMENT UNDER SUCH TERMS AS CASC DEEMS REASONABLE, AND CASC HAS THE AUTHORITY
TO DIRECT THE ACTIVITIES OF THOSE OTHER PERSONS IN THE MANNER CASC DEEMS
APPROPRIATE.
3. OTHER ACTIVITIES OF CASC. CASC AND ANY OF ITS AFFILIATES MAY RENDER
TO OTHER PERSONS SERVICES SIMILAR TO THOSE IT PROVIDES TO THE FUND UNDER THIS
AGREEMENT. CASC OR ANY INTERESTED PERSON OF CASC MAY INVEST IN ANY SERIES AS A
SHAREHOLDER, BECOME AN OFFICER OR TRUSTEE OF THE FUND IF PROPERLY ELECTED, OR
ENTER INTO ANY OTHER RELATIONSHIP WITH THE FUND APPROVED BY THE TRUSTEES, IF
NECESSARY, AND IN ACCORDANCE WITH LAW.
4. RECORDKEEPING AND OTHER INFORMATION. CASC WILL, COMMENCING NO LATER
THAN THE EFFECTIVE DATE OF THIS AGREEMENT, OR THE COMMENCEMENT DATE OF ANY
SUBSEQUENTLY-CONSTITUTED SERIES, CREATE AND MAINTAIN ALL NECESSARY
ADMINISTRATIVE RECORDS OF THE RELEVANT SERIES IN ACCORDANCE WITH ALL APPLICABLE
LAWS, RULES AND REGULATIONS, INCLUDING, BUT NOT LIMITED TO, RECORDS REQUIRED BY
SECTION 31(A) OF THE INVESTMENT COMPANY ACT OF 1940 AND THE RULES UNDER THAT
SECTION. ALL RECORDS ARE THE PROPERTY OF THE FUND AND ARE AVAILABLE FOR
INSPECTION AND USE BY THE FUND.
5. AUDIT, INSPECTION AND VISITATION. CASC WILL MAKE AVAILABLE DURING
REGULAR BUSINESS HOURS ALL RECORDS AND OTHER DATA CREATED AND MAINTAINED
PURSUANT TO THIS AGREEMENT FOR REASONABLE AUDIT AND INSPECTION BY THE SEC, THE
FUND OR ANY PERSON RETAINED BY THE FUND IF THAT PERSON'S FUNCTION NECESSITATES
ACCESS TO SUCH RECORDS AND DATA.
6. COMPENSATION TO CASC. CASC WILL BE COMPENSATED BY THE FUND ON A
MONTHLY BASIS FOR THE SERVICES PERFORMED UNDER THIS AGREEMENT, THE RATE OF
COMPENSATION BEING SET FORTH IN SCHEDULE A. CASC WILL NOT BE RESPONSIBLE FOR ANY
COSTS OR EXPENSES OF THE FUND OTHER THAN THOSE SPECIFICALLY ASSUMED IN PARAGRAPH
1. EXPENSES INCURRED BY CASC AND NOT INCLUDED IN SCHEDULE A WILL BE REIMBURSED
TO CASC BY THE FUND, AS APPROPRIATE. SUCH EXPENSES MAY INCLUDE EXPENSES
INCIDENTAL TO MEETINGS OF SHAREHOLDERS, TAXES AND CORPORATE FEES LEVIED AGAINST
THE FUND OR ITS SERIES, EXPENSES OF PRINTING STOCK CERTIFICATES REPRESENTING
SHARES OF THE SERIES, EXPENSES OF PRINTING, MAILING NOTICES, PROXY MATERIAL,
REPORTS TO REGULATORY BODIES AND REPORTS TO SHAREHOLDERS OF THE FUND, EXPENSES
OF TYPESETTING PROSPECTUSES AND PRINTING AND MAILING PROSPECTUSES TO
SHAREHOLDERS, AND DATA PROCESSING EXPENSES INCIDENTAL TO MAINTENANCE OF BOOKS
AND RECORDS. SUCH CHARGES ARE PAYABLE IN FULL UPON RECEIPT OF A BILLING INVOICE.
IN LIEU OF REIMBURSING CASC FOR EXPENSES INCURRED AND NOT INCLUDED IN SCHEDULE
A, THE FUND MAY, IN ITS DISCRETION, DIRECTLY PAY ANY EXPENSES.
7. USE OF NAMES. THE FUND MAY NOT USE THE NAME OF CASC IN ANY
PROSPECTUS, SALES LITERATURE OR OTHER MATERIAL RELATING TO THE FUND OR ITS
SERIES IN ANY MANNER WITHOUT PRIOR APPROVAL BY CASC, SUCH APPROVAL NOT TO BE
UNREASONABLY WITHHELD; PROVIDED, HOWEVER, THAT CASC HEREBY APPROVES ALL USES OF
ITS NAME THAT MERELY REFER IN ACCURATE TERMS TO ITS APPOINTMENT OR THAT ARE
REQUIRED BY THE SEC OR A STATE SECURITIES COMMISSION. CASC MAY NOT USE THE NAME
OF THE FUND OR ITS SERIES IN ANY MATERIAL RELATING TO CASC IN ANY MANNER WITHOUT
PRIOR APPROVAL BY THE FUND, SUCH APPROVAL NOT TO BE UNREASONABLY WITHHELD;
PROVIDED, HOWEVER, THAT THE FUND HEREBY APPROVES ALL USES OF ITS NAME OR THE
NAMES OF ITS SERIES THAT MERELY REFER IN ACCURATE TERMS TO THE APPOINTMENT OF
CASC OR THAT ARE REQUIRED BY THE SEC OR A STATE SECURITIES COMMISSION.
8. SECURITY. CASC REPRESENTS AND WARRANTS THAT, TO THE BEST OF ITS
KNOWLEDGE, THE VARIOUS PROCEDURES AND SYSTEMS THAT CASC PROPOSES TO IMPLEMENT
WITH REGARD TO SAFEGUARDING INFORMATION FROM LOSS OR DAMAGE ATTRIBUTABLE TO
FIRE, THEFT OR ANY OTHER CAUSE (INCLUDING PROVISION FOR TWENTY-FOUR HOUR A DAY
RESTRICTED ACCESS) WITH RESPECT TO THE FUND'S BOOKS AND RECORDS ADMINISTERED
PURSUANT TO THIS AGREEMENT AND CASC'S RECORDS, DATA, EQUIPMENT, FACILITIES AND
OTHER PROPERTY USED IN THE PERFORMANCE OF ITS OBLIGATIONS UNDER THIS AGREEMENT
ARE ADEQUATE AND THAT CASC WILL IMPLEMENT THESE PROCEDURES AND SYSTEM IN A
MANNER CALCULATED TO ENSURE THE PERFORMANCE OF CASC'S OBLIGATIONS UNDER THIS
AGREEMENT.
9. LIMITATION OF LIABILITY. THE FUND WILL INDEMNIFY AND HOLD CASC
HARMLESS AGAINST ANY LOSSES, CLAIMS, DAMAGES, LIABILITIES OR EXPENSES (INCLUDING
REASONABLE COUNSEL FEES AND EXPENSES) RESULTING FROM ANY CLAIM, DEMAND, ACTION
OR SUIT BROUGHT BY ANY PERSON (INCLUDING A SHAREHOLDER NAMING THE FUND OR ANY OF
ITS SERIES AS A PARTY) OTHER THAN THE FUND NOT RESULTING FROM CASC'S NEGLIGENCE,
OR CAUSED BY ERRORS OF JUDGMENT OR MISTAKES OF LAW COMMITTED BY CASC IN A GOOD
FAITH EFFORT TO CARRY OUT ITS DUTIES UNDER THIS AGREEMENT.
IN NO EVENT WILL CASC BE LIABLE FOR INDIRECT, SPECIAL, OR CONSEQUENTIAL
DAMAGES (EVEN IF CASC HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES)
ARISING FROM THE OBLIGATIONS ASSUMED HEREUNDER AND THE SERVICES PROVIDED FOR BY
THIS AGREEMENT, INCLUDING BUT NOT LIMITED TO LOST PROFITS, LOSS OF USE OF
ACCOUNTING SYSTEMS, COST OF CAPITAL, COST OF SUBSTITUTE FACILITIES, PROGRAMS OR
SERVICES, DOWNTIME COSTS, OR CLAIMS OF THE FUND'S SHAREHOLDERS FOR SUCH DAMAGE.
10. LIMITATION OF FUND'S LIABILITY. CASC ACKNOWLEDGES THAT IT HAS
RECEIVED NOTICE OF AND ACCEPTS THE LIMITATION ON THE FUND'S LIABILITY. CASC
AGREES THAT THE FUND'S OBLIGATIONS IN ANY CASE EXTEND ONLY TO THE SERIES AND
THEIR ASSETS, AND THAT CASC WILL NOT SEEK SATISFACTION OF ANY OBLIGATION FROM
THE SHAREHOLDERS OR ANY TRUSTEE, OFFICER, EMPLOYEE OR AGENT OF THE FUND.
11. FORCE MAJEURE. CASC WILL NOT BE LIABLE FOR DELAYS OR ERRORS CAUSED
BY CIRCUMSTANCES BEYOND CASC'S CONTROL, INCLUDING BUT NOT LIMITED TO ACTS OF
CIVIL OR MILITARY AUTHORITY, NATIONAL EMERGENCIES, WORK STOPPAGES, FIRE, FLOOD
CATASTROPHE, ACTS OF GOD, INSURRECTION, WAR, RIOT, OR FAILURE OF COMMUNICATION
OR POWER SUPPLY. IN THE EVENT OF EQUIPMENT BREAKDOWNS BEYOND ITS CONTROL, CASC
WILL TAKE REASONABLE STEPS TO MINIMIZE SERVICE INTERRUPTIONS BUT WILL HAVE NO
LIABILITY IN THE EVENT INTERRUPTIONS OCCUR.
12. AMENDMENTS. CASC AND THE FUND WILL CONSULT EACH OTHER REGARDING
CASC'S PERFORMANCE OF ITS OBLIGATIONS UNDER THIS AGREEMENT. ANY CHANGE IN THE
FUND'S REGISTRATION STATEMENTS UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
THE 1940 ACT OR IN THE FORMS RELATING TO ANY PLAN, PROGRAM OR SERVICE OFFERED BY
THE CURRENT PROSPECTUSES OF THE SERIES THAT WOULD REQUIRE A CHANGE IN CASC'S
OBLIGATIONS UNDER THIS AGREEMENT WILL BE SUBJECT TO CASC'S APPROVAL, WHICH WILL
NOT BE UNREASONABLY WITHHELD.
13. DURATION, TERMINATION, ETC. NEITHER THIS AGREEMENT NOR ANY OF ITS
PROVISIONS MAY BE CHANGED, WAIVED, DISCHARGED, OR TERMINATED ORALLY, BUT ONLY BY
WRITTEN INSTRUMENT WHICH WILL MAKE SPECIFIC REFERENCE TO THIS AGREEMENT AND
WHICH WILL BE SIGNED BY THE PARTY AGAINST WHICH ENFORCEMENT OF SUCH CHANGE,
WAIVER, DISCHARGE OR TERMINATION IS SOUGHT. THIS AGREEMENT WILL CONTINUE IN
EFFECT UNTIL DECEMBER 31, 1997, AND FOR ONE-YEAR TERMS THEREAFTER OR AS THE
PARTIES MAY MUTUALLY AGREE. THIS AGREEMENT MAY BE TERMINATED FOR CAUSE EITHER BY
THE FUND OR CASC, BUT ONLY AFTER A REASONABLE OPPORTUNITY TO CURE HAS BEEN
PROVIDED TO THE PARTY ACCUSED OF NOT PERFORMING ACCORDING TO THE TERMS OF THIS
AGREEMENT. WHAT CONSTITUTES A REASONABLE AMOUNT OF TIME TO CURE ANY DEFICIENCY
WILL BE DETERMINED BY THE PARTIES IN THE CONTEXT OF ACTION THAT NEEDS TO BE
TAKEN IN ORDER TO CURE THE DEFICIENCY, BUT IN NO EVENT WILL THE PARTY HAVE LESS
THAN 90 DAYS TO ATTEMPT TO CURE THE DEFICIENCY. IN THE EVENT THAT THE CAUSE
REMAINS UNREMEDIED, THE PARTIES HAVE THE OPTION TO TERMINATE THE CONTRACT PRIOR
TO ITS EXPIRATION DATE. ANY SUCH TERMINATION WILL NOT AFFECT THE RIGHTS AND
OBLIGATIONS OF THE PARTIES UNDER PARAGRAPHS 9 AND 10 OF THIS AGREEMENT. IN THE
EVENT THE FUND DESIGNATES A SUCCESSOR TO ANY OF CASC'S OBLIGATIONS UNDER THIS
AGREEMENT, CASC WILL, AT THE EXPENSE AND DIRECTION OF THE FUND, TRANSFER TO SUCH
SUCCESSOR ALL RELEVANT BOOKS, RECORDS AND OTHER DATA ESTABLISHED OR MAINTAINED
BY CASC.
14. MISCELLANEOUS. EACH PARTY AGREES TO PERFORM SUCH FURTHER ACTS AND
EXECUTE SUCH FURTHER DOCUMENTS AS ARE NECESSARY TO EFFECTUATE THE PURPOSES OF
THIS AGREEMENT. THIS AGREEMENT WILL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH
AND GOVERNED BY THE LAWS OF MARYLAND. THE CAPTIONS IN THIS AGREEMENT ARE
INCLUDED FOR CONVENIENCE ONLY AND DO NOT DEFINE OR DELIMIT ANY OF THE PROVISIONS
HEREOF OR OTHERWISE AFFECT THEIR CONSTRUCTION OR EFFECT.
IN WITNESS WHEREOF, THE PARTIES HAVE DULY EXECUTED THIS AGREEMENT AS OF THE
DATE INDICATED ABOVE.
CALVERT ADMINISTRATIVE SERVICES COMPANY
BY
TITLE
CALVERT CASH RESERVES
BY
TITLE
<PAGE>
ADMINISTRATIVE SERVICES AGREEMENT
SCHEDULE A
LISTED BELOW ARE THE SERIES OF CALVERT CASH RESERVES THAT ARE ENTITLED TO
RECEIVE ADMINISTRATIVE SERVICES FROM CALVERT ADMINISTRATIVE SERVICES COMPANY
("CASC") UNDER THE ADMINISTRATIVE SERVICES AGREEMENT DATED AUGUST 7, 1996, AND
WHICH WILL PAY ANNUAL FEES TO CASC PURSUANT TO THE AGREEMENT.
INSTITUTIONAL PRIME FUND 0.05%
FOR ITS SERVICES UNDER THIS ADMINISTRATIVE SERVICES AGREEMENT, CASC IS
ENTITLED TO RECEIVE THE FEE INDICATED ABOVE BASED ON AVERAGE NET ASSETS. A
SERIES' LIABILITY TO PAY FOR SERVICES UNDER THE AGREEMENT ARISES AT THE TIME THE
SERIES COMMENCES OPERATIONS, ABSENT WAIVERS.
EXHIBIT 10
JANUARY 26, 2000
SECURITIES AND EXCHANGE COMMISSION
JUDICIARY PLAZA
450 FIFTH STREET, N.W.
WASHINGTON, D.C. 20549
RE: EXHIBIT 10, FORM N-1A
CALVERT CASH RESERVES
FILE NUMBERS 2-76527 AND 811-3418
LADIES AND GENTLEMEN:
AS COUNSEL TO CALVERT CASH RESERVES (THE "TRUST"), IT IS MY OPINION,
BASED UPON AN EXAMINATION OF THE TRUST'S DECLARATION OF TRUST AND BY-LAWS AND
SUCH OTHER ORIGINAL OR PHOTOSTATIC COPIES OF TRUST RECORDS, CERTIFICATES OF
PUBLIC OFFICIALS, DOCUMENTS, PAPERS, STATUTES, AND AUTHORITIES AS I DEEMED
NECESSARY TO FORM THE BASIS OF THIS OPINION, THAT THE SECURITIES BEING
REGISTERED BY THIS POST-EFFECTIVE AMENDMENT NO. 25 OF THE TRUST WILL,
WHEN SOLD, BE LEGALLY ISSUED, FULLY PAID AND NON-ASSESSABLE.
CONSENT IS HEREBY GIVEN TO FILE THIS OPINION OF COUNSEL WITH THE SECURITIES
AND EXCHANGE COMMISSION AS AN EXHIBIT TO THE TRUST'S POST-EFFECTIVE
AMENDMENT NO. 25 TO ITS REGISTRATION STATEMENT.
SINCERELY,
/S/SUSAN WALKER BENDER
ASSOCIATE GENERAL COUNSEL
CONSENT OF INDEPENDENT ACCOUNTANTS
WE CONSENT TO THE INCORPORATION BY REFERENCE IN POST-EFFECTIVE AMENDMENT NO. 25
TO THE REGISTRATION STATEMENT OF CALVERT CASH RESERVES INSTITUTIONAL PRIME FUND
ON FORM N1 A (FILE NUMBER 2-76527 AND 811-3418) OF OUR REPORT DATED NOVEMBER 10,
1999, ON OUR AUDIT OF THE FINANCIAL STATEMENTS AND FINANCIAL HIGHLIGHTS OF THE
FUND, WHICH REPORT IS INCLUDED IN THE ANNUAL REPORT TO SHAREHOLDERS FOR THE YEAR
ENDED SEPTEMBER 30, 1999, WHICH IS INCORPORATED BY REFERENCE IN THE REGISTRATION
STATEMENT. WE ALSO CONSENT TO THE REFERENCE OF OUR FIRM UNDER THE CAPTION
"FINANCIAL HIGHLIGHTS" IN THE PROSPECTUS AND "INDEPENDENT ACCOUNTANTS" IN THE
STATEMENT OF ADDITIONAL INFORMATION.
PRICEWATERHOUSECOOPERS LLP
BALTIMORE, MARYLAND
JANUARY 27, 2000
E:\PROCEDURES\FALL FINAL 1999 CODE of ETHICS REVISIONS.doc
REVISED DECEMBER 1999
CODE OF ETHICS AND INSIDER TRADING POLICY AND PROCEDURES
CALVERT ASSET MANAGEMENT COMPANY, INC.
CALVERT-SLOAN, ADVISERS, L.L.C.
CALVERT DISTRIBUTORS, INC.
FIRST VARIABLE RATE FUND FOR GOVERNMENT INCOME
CALVERT TAX-FREE RESERVES
CALVERT SOCIAL INVESTMENT FUND
THE CALVERT FUND
CALVERT MUNICIPAL FUND INC.
CALVERT WORLD VALUES FUND, INC.
CALVERT VARIABLE SERIES, INC.
CALVERT CASH RESERVES
CALVERT NEW WORLD FUND, INC.
THE CODE OF ETHICS AND INSIDER TRADING POLICIES AND PROCEDURES ARE DESIGNED TO
PROTECT THE PUBLIC FROM ABUSIVE TRADING PRACTICES AND TO MAINTAIN ETHICAL
STANDARDS FOR ACCESS PERSONS WHEN DEALING WITH THE PUBLIC. ACTIVE LEADERSHIP
AND INTEGRITY OF MANAGEMENT DICTATES THESE PRINCIPLES BE DILIGENTLY IMPLEMENTED
AND MONITORED. THE CODE OF ETHICS IMPOSES THE FOLLOWING GENERAL OBLIGATIONS:
- - INFORMATION CONCERNING THE PURCHASE AND SALE OF SECURITIES LEARNED IN
CONNECTION WITH AN ACCESS PERSON'S SERVICE, IS PROPERTY OF THE FUND, ADVISER OR
EMPLOYER AND MAY NOT BE USED FOR PERSONAL BENEFIT.
- - FIDUCIARY DUTIES MANDATE SUITABLE INVESTMENT OPPORTUNITIES BE PRESENTED
FIRST TO THE FUND, ADVISER, OR EMPLOYER AND SHOULD NOT BE EXERCISED EVEN AFTER
FULL DISCLOSURE FOR PERSONAL BENEFIT.
- - MATERIAL INSIDE INFORMATION MUST BE KEPT CONFIDENTIAL AND RESTRICTS
TRADING OF SECURITIES.
- - FRONT RUNNING, MARKET MANIPULATION AND DECEPTIVE TRADING PRACTICES ARE
ABUSIVE TECHNIQUES PROHIBITED BY THESE PROCEDURES AND MAY RESULT, IN FINES,
TERMINATION OR LEGAL ACTIONS BY THIRD PARTIES.
- - ACCESS PERSONS MAY NOT PURCHASE IPOS DUE TO THE HIGH POTENTIAL FOR ABUSIVE
TRADING PRACTICES.
- - ACCESS PERSONS MUST NOT TRADE IN SECURITIES WITH KNOWLEDGE THAT THE FUND,
ADVISER, SUB-ADVISER OR EMPLOYER IS CONSIDERING TO MAKE A SIMILAR PURCHASE OR
SALE OF THE SAME SECURITIES.
- - ACCESS PERSONS SHALL NOT ENGAGE IN TRANSACTIONS THAT CREATE A CONFLICT OF
INTEREST INCLUDING BUT NOT LIMITED TO INAPPROPRIATELY MAKING DECISIONS ON BEHALF
OF A FUND REGARDING SECURITIES OR PRIVATE PLACEMENTS PERSONALLY OWNED BY THE
ACCESS PERSON.
CODE OF ETHICS GUIDELINES
THE LEGAL DEFINITION OF A SECURITY IS VERY BROAD AND INCORPORATES THE PURCHASE
AND SALE OF PUBLIC, PRIVATE, REGISTERED AND EXEMPT FROM REGISTRATION SECURITIES,
AS WELL AS DERIVATIVES. TO EASE THE BURDEN OF FOLLOWING THESE GUIDELINES, THE
CODE OF ETHICS REPORTING AND DISCLOSURE OBLIGATIONS AS WELL AS PRECLEARANCE
POLICIES DO NOT APPLY TO THE FOLLOWING:
1) THE SALE AND PURCHASE OF OPEN-END MUTUAL FUNDS INCLUDING MONEY MARKET
FUNDS.
2) THE SALE AND PURCHASE OF U.S. GOVERNMENT, U.S. GOVERNMENT AGENCY
SECURITIES AND MUNICIPAL SECURITIES IN TRADE AMOUNTS OF LESS THAN $20,000.
3) ACQUISITIONS THROUGH STOCK DIVIDEND PLANS, SPIN-OFFS OR OTHER
DISTRIBUTIONS APPLIED TO ALL HOLDERS OF THE SAME CLASS OF SECURITIES.
4) ACQUISITIONS THROUGH THE EXERCISE OF RIGHTS ISSUED PRO RATA TO ALL
HOLDERS.
5) ACQUISITIONS THROUGH GIFTS OR BEQUESTS.
6) TRADES IN ANY S & P 500 COMPANY OF 500 SHARES OR LESS.
7) TRADES IN REITS AND VARIABLE INSURANCE PRODUCTS.
A. DISCLOSURE OF HOLDINGS & DUPLICATE STATEMENTS AND CONFIRMATIONS FOR THE
PURCHASE AND SALE OF SECURITIES OR OPTIONS ON SECURITIES BY ACCESS PERSONS.
TO ASSURE THAT ABUSIVE OR UNETHICAL TRADING PRACTICES ARE NOT CONDUCTED BY
ACCESS PERSONS, ACCESS PERSONS ARE REQUIRED TO DISCLOSE PERSONAL SECURITIES
HOLDINGS INCLUDING PRIVATE PLACEMENT HOLDINGS AND SEND DUPLICATE BROKERAGE AND
CONFIRMATION STATEMENTS TO THE ATTENTION OF THE COMPLIANCE OFFICER AT CALVERT
GROUP, LTD., 4550 MONTGOMERY AVENUE, BETHESDA, MD 20814. PERSONAL SECURITIES
HOLDINGS MUST BE DISCLOSED AT THE POINT OF HIRE AND UPON ANNUAL ACKNOWLEDGEMENT
OF THESE PROCEDURES. DUPLICATE STATEMENTS AND CONFIRMATIONS ARE REQUIRED FOR
ANY ACCESS PERSON'S ACCOUNT OR AN ACCOUNT OVER WHICH THE ACCESS PERSON HAS
EITHER CUSTODY, CONTROL OR BENEFICIAL OWNERSHIP. ACCOUNT STATEMENTS FOR
IMMEDIATE FAMILY MEMBERS ARE ALSO REQUIRED."BENEFICIAL OWNERSHIP" SHALL HAVE THE
SAME MEANING AS IN RULE 16A-1(A)(2) UNDER THE SECURITIES EXCHANGE ACT OF 1934.
GENERALLY, A PERSON HAS A BENEFICIAL OWNERSHIP IN A SECURITY IF HE OR SHE,
DIRECTLY OR INDIRECTLY, THROUGH ANY CONTRACT, ARRANGEMENT, UNDERSTANDING,
RELATIONSHIP OR OTHERWISE, HAS OR SHARES A DIRECT OR INDIRECT PECUNIARY INTEREST
IN THE SECURITY, [HAS OR SHARES VOTING POWER (THE POWER TO VOTE OR DIRECT THE
VOTING OF THE SECURITY) OR INVESTMENT POWER (THE POWER TO DISPOSE OF OR DIRECT
THE DISPOSITION OF THE SECURITY).] BENEFICIAL OWNERSHIP" INCLUDES ACCOUNTS OF
A SPOUSE, MINOR CHILDREN AND RELATIVES RESIDENT IN THE ACCESS PERSON'S HOME, AS
WELL AS ACCOUNTS OF ANOTHER PERSON IF BY REASON OF ANY CONTRACT, UNDERSTANDING,
RELATIONSHIP, AGREEMENT OR OTHER ARRANGEMENT THE ACCESS PERSON OBTAINS THEREFROM
BENEFITS SUBSTANTIALLY EQUIVALENT TO THOSE OF OWNERSHIP, E.G., AS TRUSTEE,
SETTLOR, BENEFICIARY, POWER OF ATTORNEY.
ALL INFORMATION PROVIDED TO THE COMPLIANCE OFFICER WILL BE CONFIDENTIAL.
STATEMENTS AND CONFIRMATIONS WILL BE REVIEWED BY THE COMPLIANCE OFFICER OR HIS
OR HER DESIGNEE(S) FOR ANY PATTERN OF TRANSACTIONS INVOLVING PARALLEL
TRANSACTIONS (PORTFOLIO AND INDIVIDUAL BOTH BUYING OR BOTH SELLING THE SAME
SECURITY) GENERALLY WITHIN A 15 DAY PERIOD BEFORE OR AFTER THE TRANSACTION DATE.
AMONG THE FACTORS THAT WILL BE CONSIDERED IN THE ANALYSIS OF WHETHER ANY
PROVISION OF THE CODE HAS BEEN VIOLATED WILL BE THE NUMBER AND DOLLAR VALUE OF
THE TRANSACTIONS, THE TRADING VOLUME OF THE SECURITIES IN QUESTION, THE LENGTH
OF TIME THE SECURITY IS HELD BY THE INDIVIDUAL AND THE INDIVIDUAL'S INVOLVEMENT
IN THE INVESTMENT PROCESS. WHILE THE FOCUS OF THIS PROCEDURE OF THE CODE IS ON
"PATTERNS", IT IS IMPORTANT TO NOTE THAT A VIOLATION COULD RESULT FROM A SINGLE
TRANSACTION IF THE CIRCUMSTANCES WARRANT A FINDING THAT THE UNDERLYING
PRINCIPLES OF FAIR DEALING HAVE BEEN VIOLATED. THE COMPLIANCE OFFICER OR HIS OR
HER DESIGNEE(S), WILL SIMILARLY REVIEW THE PERSONAL SECURITIES HOLDINGS REPORTS
PROVIDED TO THE COMPLIANCE OFFICER.
B. PRECLEARANCE POLICY
BECAUSE OF THE SENSITIVE NATURE OF SECURITIES TRADING, THE COMPLIANCE OFFICER
WILL NOTIFY CERTAIN ACCESS PERSONS AND INVESTMENT PERSONNEL ABOUT THE NEED TO
FOLLOW A PRECLEARANCE POLICY. ATTACHMENT A WILL BE USED BY DESIGNATED ACCESS
PERSONS SEEKING PRECLEARANCE FOR SECURITIES TRADES INCLUDING PRECLEARANCE BY
INVESTMENT PERSONNEL FOR PRIVATE PLACEMENT TRANSACTIONS. THOSE INDIVIDUALS
SUBJECT TO THE PRECLEARANCE POLICY WILL NOT BE EXEMPT FROM THE GENERAL
PROHIBITIONS LISTED IN THE CODE OR THE POLICIES AND PROCEDURES DESIGNED TO
PREVENT INSIDER TRADING. THE COMPLIANCE OFFICER WILL REVIEW WITH THE
DIRECTORS/TRUSTEES PERIODICALLY A LIST OF PERSONS WHO ARE SUBJECT TO THE
PRECLEARANCE POLICY AND THE CRITERIA USED TO SELECT SUCH INDIVIDUALS.
THE PRECLEARANCE AUTHORIZATION SHALL BE VALID FOR A PERIOD OF THREE BUSINESS
DAYS UNLESS A FURTHER EXTENSION OF TIME IS INDICATED BY THE COMPLIANCE OFFICER.
<PAGE>
C. NOTIFICATION OF REPORTING OBLIGATION - ANNUAL CERTIFICATION TO BOARD
MEMBERS OF THE LEGAL DEPARTMENT WILL BE RESPONSIBLE FOR NOTIFYING ALL ACCESS
PERSONS ABOUT THE DUTY TO FORWARD TRADE CONFIRMATIONS TO THE COMPLIANCE OFFICER.
ONCE INFORMED OF THE DUTY TO FORWARD TRADE CONFIRMATIONS, AN ACCESS PERSON HAS A
CONTINUING OBLIGATION TO PROVIDE SUCH CONFIRMS, IN A TIMELY MANNER, UNTIL SUCH
TIME AS NOTIFIED OTHERWISE. INFORMATION COMPILED IN COMPLIANCE OFFICER REPORTS
IS AVAILABLE FOR INSPECTION BY THE SEC OR OTHER REGULATORY AUTHORITIES AT ANY
TIME DURING THE FIVE-YEAR PERIOD FOLLOWING THE END OF THE FISCAL YEAR IN WHICH
EACH REPORT IS MADE.
ANNUALLY, THE LEGAL DEPARTMENT WILL PREPARE A WRITTEN " ISSUES AND CERTIFICATION
REPORT" FOR THE BOARD THAT:
- - DESCRIBES ANY ISSUES THAT HAVE ARISEN UNDER THIS CODE OF ETHICS OR ITS
PROCEDURES SINCE THE LAST REPORT, INCLUDING INFORMATION ABOUT MATERIAL CODE OF
ETHICS OR PROCEDURE VIOLATIONS AND SANCTIONS IMPOSED IN RESPONSE TO THOSE
VIOLATIONS; AND
- - CERTIFIES TO THE BOARD THAT THE ADOPTED CODE OF ETHICS AND ITS PROCEDURES
PROVIDE REASONABLY NECESSARY MEASURES TO PREVENT INVESTMENT PERSONNEL FROM
VIOLATING THE CODE AND APPLICABLE PROCEDURES.
THE CODE OF ETHICS AND ANY MATERIAL CHANGES TO ITS PROVISIONS AND/OR PROCEDURES
MUST BE APPROVED BY A MAJORITY OF THE BOARD, INCLUDING A MAJORITY OF THE
INDEPENDENT DIRECTORS.
D. RESTRICTIONS AS TO GIFTS, ENTERTAINMENT, FAVORS AND DIRECTORSHIPS
1. GIFTS, ENTERTAINMENT AND FAVORS. ACCESS PERSONS MUST NOT MAKE BUSINESS
DECISIONS THAT ARE INFLUENCED OR APPEAR TO BE INFLUENCED BY GIVING OR ACCEPTING
GIFTS, ENTERTAINMENT OR FAVORS. ACCESS PERSONS ARE PROHIBITED FROM RECEIVING ANY
GIFT OR OTHER THING OF MORE THAN DE MINIMIS VALUE FROM ANY PERSON OR ENTITY THAT
DOES BUSINESS WITH OR ON BEHALF OF CALVERT ASSET MANAGEMENT COMPANY,
CALVERT-SLOAN ADVISERS, OR CALVERT DISTRIBUTORS INC. INVITATIONS TO AN
OCCASIONAL MEAL, SPORTING EVENT OR OTHER SIMILAR ACTIVITY WILL NOT BE DEEMED TO
VIOLATE THIS RESTRICTION UNLESS THE OCCURRENCE OF SUCH EVENTS IS SO FREQUENT OR
LAVISH AS TO SUGGEST AN IMPROPRIETY. THE PRESIDENT/CEO OF CALVERT GROUP MUST
APPROVE THE ACCEPTANCE OF ANY GIFT, ENTERTAINMENT OR FAVOR WITH A PER GIFT VALUE
OF MORE THAN $100.00.
2. DIRECTORSHIPS.
(A) GENERAL RULE:
NO ACCESS PERSON, OTHER THAN A DISINTERESTED FUND DIRECTOR/TRUSTEE, MAY SERVE ON
THE BOARD OF DIRECTORS OF A PUBLICLY-HELD OR PRIVATE FOR-PROFIT COMPANY ABSENT
PRIOR WRITTEN APPROVAL FROM THE CALVERT GROUP, LTD. BOARD OF DIRECTORS AND/OR
THE APPLICABLE FUND'S BOARD OF DIRECTORS/TRUSTEES. DISINTERESTED
DIRECTORS/TRUSTEES MUST PROVIDE ANNUAL DISCLOSURE ABOUT DIRECTORSHIPS AND OTHER
POTENTIAL CONFLICTS OF INTEREST.
(B) APPLICATIONS FOR APPROVAL:
APPLICATIONS FOR APPROVAL TO SERVE AS A DIRECTOR OF A PUBLICLY TRADED OR PRIVATE
FOR-PROFIT COMPANY SHALL BE DIRECTED, IN WRITING, TO THE OFFICE OF THE GENERAL
COUNSEL FOR PROMPT FORWARDING TO THE CALVERT GROUP, LTD. BOARD OF DIRECTORS AND
THE RESPECTIVE FUND'S BOARD OF DIRECTORS/TRUSTEES. AUTHORIZATION MAY BE GRANTED
WHERE IT IS DETERMINED THAT SUCH BOARD SERVICE WOULD BE CONSISTENT WITH THE
INTERESTS OF THE FUNDS AND THEIR SHAREHOLDERS.
(C) SUBSEQUENT INVESTMENT MANAGEMENT ACTIVITIES:
WHENEVER AN ACCESS PERSON IS GRANTED APPROVAL TO SERVE AS A DIRECTOR OF A
PUBLICLY-TRADED OR PRIVATE FOR-PROFIT COMPANY, HE OR SHE SHALL PERSONALLY
REFRAIN FROM PARTICIPATING IN ANY DELIBERATION, RECOMMENDATIONS, OR
CONSIDERATIONS OF WHETHER OR NOT TO RECOMMEND THAT ANY SECURITIES OF THAT
COMPANY BE PURCHASED, SOLD OR RETAINED IN THE INVESTMENT PORTFOLIO OF ANY
CALVERT GROUP FUND OR CALVERT ASSET MANAGEMENT COMPANY MANAGED ACCOUNT.
E. ENFORCEMENT AND SANCTIONS
EACH VIOLATION OF THIS CODE SHALL BE REPORTED TO THE BOARD OF
DIRECTORS/TRUSTEES OF THE APPLICABLE FUND OR ENTITY AT OR BEFORE THE NEXT
REGULAR MEETING OF THE BOARD. UPON DISCOVERING OR OTHERWISE BEING INFORMED OF A
VIOLATION OF THIS CODE, THE BOARD OF DIRECTORS/TRUSTEES MAY TAKE ANY ACTION IT
DEEMS APPROPRIATE INCLUDING, INTER ALIA, A LETTER OF CENSURE, TERMINATION WITH
RESPECT TO PORTFOLIO MANAGEMENT DUTIES REGARDING THE FUND, OR RECOMMENDING TO
THE OPERATING COMPANIES, SUSPENSION OR REMOVAL FROM OFFICE, IMPOSITION OF A FINE
OR TERMINATION OF EMPLOYMENT OF THE VIOLATOR.
F. RECORDKEEPING
EACH ENTITY SHALL MAINTAIN SUCH LISTS, RECORDS, AND REPORTS AS ARE REQUIRED
BY LAW.
<PAGE>
G. INSIDER TRADING POLICY AND PROCEDURES
1. SCOPE OF POLICY STATEMENT
THIS POLICY STATEMENT IS DRAFTED BROADLY; IT WILL BE APPLIED AND
INTERPRETED IN A SIMILAR MANNER. THIS POLICY STATEMENT APPLIES TO SECURITIES
TRADING AND INFORMATION HANDLING BY ALL ACCESS PERSONS.
THE LAW OF INSIDER TRADING IS UNSETTLED; AN INDIVIDUAL LEGITIMATELY MAY BE
UNCERTAIN ABOUT THE APPLICATION OF THE POLICY STATEMENT IN A PARTICULAR
CIRCUMSTANCE. OFTEN, A SINGLE QUESTION CAN FORESTALL DISCIPLINARY ACTION OR
COMPLEX LEGAL PROBLEMS. YOU SHOULD DIRECT ANY QUESTIONS RELATING TO THE POLICY
STATEMENT TO AN ATTORNEY IN THE CALVERT GROUP LEGAL DEPARTMENT. YOU MUST ALSO
NOTIFY AN ATTORNEY IN THE LEGAL DEPARTMENT IF YOU HAVE ANY REASON TO BELIEVE
THAT A VIOLATION OF THE POLICY STATEMENT HAS OCCURRED OR IS ABOUT TO OCCUR.
2. POLICY STATEMENT ON INSIDER TRADING
CALVERT FORBIDS ANY OFFICER, DIRECTOR\TRUSTEE OR EMPLOYEE FROM TRADING,
EITHER PERSONALLY OR ON BEHALF OF OTHERS, INCLUDING MUTUAL FUNDS MANAGED BY
CALVERT, ON MATERIAL NONPUBLIC INFORMATION OR COMMUNICATING MATERIAL NONPUBLIC
INFORMATION TO OTHERS IN VIOLATION OF THE LAW. THIS CONDUCT IS FREQUENTLY
REFERRED TO AS "INSIDER TRADING." CALVERT'S POLICY APPLIES TO EACH FUND, ITS
INVESTMENT ADVISOR, ITS PRINCIPAL UNDERWRITER, AND EVERY OFFICER, DIRECTOR AND
EMPLOYEE THEREOF, AND EXTENDS TO ACTIVITIES WITHIN AND OUTSIDE THEIR DUTIES AT
CALVERT. EVERY OFFICER, DIRECTOR, TRUSTEE AND EMPLOYEE MUST READ AND RETAIN THIS
POLICY STATEMENT. ANY QUESTIONS REGARDING CALVERT'S POLICY AND PROCEDURES SHOULD
BE REFERRED TO AN ATTORNEY IN THE CALVERT LEGAL DEPARTMENT. AN OFFICER,
DIRECTOR, TRUSTEE OR EMPLOYEE MUST NOTIFY AN ATTORNEY IN THE LEGAL DEPARTMENT
IMMEDIATELY IF THEY HAVE ANY REASON TO BELIEVE THAT A VIOLATION OF THE POLICY
STATEMENT HAS OCCURRED OR IS ABOUT TO OCCUR.
THE TERM "INSIDER TRADING" IS NOT DEFINED IN THE FEDERAL SECURITIES LAWS,
BUT GENERALLY IS USED TO REFER TO THE USE OF MATERIAL NONPUBLIC INFORMATION TO
TRADE IN SECURITIES (WHETHER OR NOT ONE IS AN "INSIDER") OR TO COMMUNICATIONS OF
MATERIAL NONPUBLIC INFORMATION TO OTHERS.
WHILE THE LAW CONCERNING INSIDER TRADING IS NOT STATIC, IT IS GENERALLY
UNDERSTOOD THAT THE LAW PROHIBITS:
A) TRADING BY AN INSIDER, WHILE IN POSSESSION OF MATERIAL
NONPUBLIC INFORMATION; OR
B) TRADING BY A NON-INSIDER, WHILE IN POSSESSION OF MATERIAL NONPUBLIC
INFORMATION, WHERE THE INFORMATION EITHER WAS DISCLOSED TO THE NON-INSIDER IN
VIOLATION OF AN INSIDER'S DUTY TO KEEP IT CONFIDENTIAL OR WAS MISAPPROPRIATED;
OR
C) COMMUNICATING MATERIAL NONPUBLIC INFORMATION TO OTHERS.
I. WHO IS AN INSIDER?
THE CONCEPT OF "INSIDER" IS BROAD. IT INCLUDES OFFICERS, DIRECTORS,
TRUSTEES AND EMPLOYEES OF A COMPANY. IN ADDITION, A PERSON CAN BE A "TEMPORARY
INSIDER" IF HE OR SHE ENTERS INTO A SPECIAL CONFIDENTIAL RELATIONSHIP IN THE
CONDUCT OF A COMPANY'S AFFAIRS AND AS A RESULT IS GIVEN ACCESS TO INFORMATION
SOLELY FOR THE COMPANY'S PURPOSES. A TEMPORARY INSIDER CAN INCLUDE, AMONG
OTHERS, A COMPANY'S ATTORNEYS, ACCOUNTANTS, CONSULTANTS, BANK LENDING OFFICERS,
AND THE EMPLOYEES OF SUCH ORGANIZATIONS. IN ADDITION, CALVERT MAY BECOME A
TEMPORARY INSIDER OF A COMPANY IT ADVISES OR FOR WHICH IT PERFORMS OTHER
SERVICES. ACCORDING TO THE SUPREME COURT, THE COMPANY MUST EXPECT THE OUTSIDER
TO KEEP THE DISCLOSED NONPUBLIC INFORMATION CONFIDENTIAL AND THE RELATIONSHIP
MUST AT LEAST IMPLY SUCH A DUTY BEFORE THE OUTSIDER WILL BE CONSIDERED AN
INSIDER.
II. WHAT IS MATERIAL INFORMATION?
TRADING ON INSIDE INFORMATION IS NOT A BASIS FOR LIABILITY UNLESS THE
INFORMATION IS MATERIAL. "MATERIAL INFORMATION" GENERALLY IS DEFINED AS
INFORMATION FOR WHICH THERE IS A SUBSTANTIAL LIKELIHOOD THAT A REASONABLE
INVESTOR WOULD CONSIDER IT IMPORTANT IN MAKING HIS OR HER INVESTMENT DECISIONS,
OR INFORMATION THAT IS REASONABLY CERTAIN TO HAVE A SUBSTANTIAL EFFECT ON THE
PRICE OF A COMPANY'S SECURITIES. INFORMATION THAT OFFICERS, DIRECTORS AND
EMPLOYEES SHOULD CONSIDER MATERIAL INCLUDES, BUT IS NOT LIMITED TO: DIVIDEND
CHANGES, EARNINGS ESTIMATES, CHANGES IN PREVIOUSLY RELEASED EARNINGS ESTIMATES,
SIGNIFICANT MERGER OR ACQUISITION PROPOSALS OR AGREEMENTS, MAJOR LITIGATION,
LIQUIDATION PROBLEMS, AND EXTRAORDINARY MANAGEMENT DEVELOPMENTS.
MATERIAL INFORMATION ALSO MAY RELATE TO THE MARKET FOR A COMPANY'S SECURITIES.
INFORMATION ABOUT A SIGNIFICANT ORDER TO PURCHASE OR SELL SECURITIES MAY, IN
SOME CONTEXTS, BE DEEMED MATERIAL. SIMILARLY, PREPUBLICATION INFORMATION
REGARDING REPORTS IN THE FINANCIAL PRESS ALSO MAY BE DEEMED MATERIAL. FOR
EXAMPLE, THE SUPREME COURT UPHELD THE CRIMINAL CONVICTIONS OF INSIDER TRADING
DEFENDANTS WHO CAPITALIZED ON PREPUBLICATION INFORMATION ABOUT THE WALL STREET
JOURNAL'S HEARD ON THE STREET COLUMN.
IT IS CONCEIVABLE THAT SIMILAR ADVANCE REPORTS OF SECURITIES TO BE BOUGHT OR
SOLD BY A LARGE, INFLUENTIAL INSTITUTIONAL INVESTOR, SUCH AS A FUND, MAY BE
DEEMED MATERIAL TO AN INVESTMENT IN THOSE PORTFOLIO SECURITIES. ADVANCE
KNOWLEDGE OF IMPORTANT PROPOSED GOVERNMENT REGULATION, FOR EXAMPLE, COULD ALSO
BE DEEMED MATERIAL INFORMATION REGARDING COMPANIES IN THE REGULATED INDUSTRY.
III. WHAT IS NONPUBLIC INFORMATION?
INFORMATION IS NONPUBLIC UNTIL IT HAS BEEN DISSEMINATED BROADLY TO INVESTORS IN
THE MARKET PLACE. TANGIBLE EVIDENCE OF SUCH DISSEMINATION IS THE BEST INDICATION
THAT THE INFORMATION IS PUBLIC. FOR EXAMPLE, INFORMATION IS PUBLIC AFTER IT HAS
BECOME AVAILABLE TO THE GENERAL PUBLIC THROUGH A PUBLIC FILING WITH THE SEC OR
SOME OTHER GOVERNMENTAL AGENCY, THE DOW JONES "TAPE" OR THE WALL STREET JOURNAL
OR SOME OTHER PUBLICATION OF GENERAL CIRCULATION, AND AFTER SUFFICIENT TIME HAS
PASSED SO THAT THE INFORMATION HAS BEEN DISSEMINATED WIDELY
IV. PENALTIES FOR INSIDER TRADING
PENALTIES FOR TRADING ON OR COMMUNICATING MATERIAL NONPUBLIC
INFORMATION ARE SEVERE, BOTH FOR INDIVIDUALS INVOLVED IN SUCH UNLAWFUL CONDUCT
AND THEIR EMPLOYERS. A PERSON CAN BE SUBJECT TO SOME OR ALL OF THE PENALTIES
BELOW EVEN IF HE OR SHE DOES NOT PERSONALLY BENEFIT FROM THE VIOLATION.
PENALTIES INCLUDE:
- - CIVIL INJUNCTIONS
- - TREBLE DAMAGES
- - DISGORGEMENT OF PROFITS
- - JAIL SENTENCES
- - FINES FOR THE PERSON WHO COMMITTED THE VIOLATION OF UP TO THREE TIMES THE
PROFIT GAINED OR LOSS AVOIDED, WHETHER OR NOT THE PERSON ACTUALLY BENEFITED, AND
- - FINES FOR THE EMPLOYER OR OTHER CONTROLLING PERSON OF UP TO THE GREATER OF
$1,000,000 OR THREE TIMES THE AMOUNT OF THE PROFIT GAINED OR LOSS AVOIDED.
IN ADDITION, ANY VIOLATION OF THIS POLICY STATEMENT CAN BE EXPECTED TO
RESULT IN SERIOUS SANCTIONS BY CALVERT, UP TO AND INCLUDING DISMISSAL OF THE
PERSONS INVOLVED.
<PAGE>
3. IDENTIFYING INSIDE INFORMATION
BEFORE A CALVERT EMPLOYEE EXECUTES ANY TRADE FOR HIM/HERSELF OR ON
BEHALF OF OTHERS, INCLUDING INVESTMENT COMPANIES MANAGED BY CALVERT, IN THE
SECURITIES OF A COMPANY ABOUT WHICH THE EMPLOYEE MAY HAVE POTENTIAL INSIDE
INFORMATION, THE FOLLOWING QUESTIONS SHOULD BE CONSIDERED:
A) IS THE INFORMATION MATERIAL? IS THIS INFORMATION THAT AN INVESTOR
WOULD CONSIDER IMPORTANT IN MAKING HIS OR HER INVESTMENT DECISIONS? IS THIS
INFORMATION THAT WOULD SUBSTANTIALLY AFFECT THE MARKET PRICE OF THE SECURITIES
IF GENERALLY DISCLOSED?
B) IS THE INFORMATION NONPUBLIC? HOW WAS THE INFORMATION OBTAINED? TO
WHOM HAS THIS INFORMATION BEEN PROVIDED? HAS THE INFORMATION BEEN DISSEMINATED
BROADLY TO INVESTORS IN THE MARKETPLACE BY BEING PUBLISHED IN REUTERS, THE WALL
STREET JOURNAL OR OTHER PUBLICATIONS OF GENERAL CIRCULATION? IS IT ON FILE WITH
THE SECURITIES AND EXCHANGE COMMISSION?
IF, AFTER CONSIDERATION OF THE ABOVE, IT IS FOUND THAT THE INFORMATION IS
MATERIAL AND NONPUBLIC, OR IF THERE ARE QUESTIONS AS TO WHETHER THE INFORMATION
IS MATERIAL AND NONPUBLIC, THE FOLLOWING STEPS SHOULD BE TAKEN:
A) REPORT THE MATTER IMMEDIATELY TO THE COMPLIANCE OFFICER OR AN
ATTORNEY IN THE LEGAL DEPARTMENT.
B) THE SECURITIES SHOULD NOT BE PURCHASED OR SOLD BY THE OFFICER,
DIRECTOR, TRUSTEE OR EMPLOYEE FOR HIM/HERSELF OR ON BEHALF OF OTHERS, INCLUDING
INVESTMENT COMPANIES MANAGED BY CALVERT.
C) THE INFORMATION SHOULD NOT BE COMMUNICATED INSIDE OR OUTSIDE
CALVERT, OTHER THAN TO THE LEGAL DEPARTMENT.
D) AFTER THE ISSUE HAS BEEN REVIEWED, THE LEGAL DEPARTMENT WILL
INSTRUCT THE OFFICER, DIRECTOR, OR EMPLOYEE AS TO WHETHER TO CONTINUE THE
PROHIBITIONS AGAINST TRADING AND COMMUNICATION, OR ALLOWING THE TRADE AND
COMMUNICATION OF THE INFORMATION.
4. CONTACTS WITH PUBLIC COMPANIES.
FOR CALVERT, CONTACTS WITH PUBLIC COMPANIES REPRESENT AN IMPORTANT PART OF
OUR RESEARCH EFFORTS. CALVERT MAY MAKE INVESTMENT DECISIONS ON THE BASIS OF THE
FIRM'S CONCLUSIONS FORMED THROUGH SUCH CONTACTS AND ANALYSIS OF
PUBLICLY-AVAILABLE INFORMATION. DIFFICULT LEGAL ISSUES ARISE, HOWEVER, WHEN, IN
THE COURSE OF THESE CONTACTS, A CALVERT EMPLOYEE OR OTHER PERSON SUBJECT TO THIS
POLICY STATEMENT BECOMES AWARE OF MATERIAL, NONPUBLIC INFORMATION. THIS COULD
HAPPEN, FOR EXAMPLE, IF A COMPANY'S CHIEF FINANCIAL OFFICER PREMATURELY
DISCLOSES QUARTERLY RESULTS TO AN ANALYST OR AN INVESTOR RELATION REPRESENTATIVE
MAKES A SELECTIVE DISCLOSURE OF ADVERSE NEWS TO A HANDFUL OF INVESTORS. IN SUCH
SITUATION, CALVERT MUST MAKE A JUDGMENT AS TO ITS FURTHER CONDUCT. FOR THE
PROTECTION OF THE COMPANY AND ITS EMPLOYEES, THE LEGAL DEPARTMENT SHOULD BE
CONTACTED IF AN EMPLOYEE BELIEVES THAT HE/SHE HAS RECEIVED MATERIAL, NONPUBLIC
INFORMATION.
5. TENDER OFFERS
TENDER OFFERS REPRESENT A PARTICULAR CONCERN IN THE LAW OF INSIDER TRADING
FOR TWO REASONS. FIRST, TENDER OFFER ACTIVITY OFTEN PRODUCES EXTRAORDINARY
GYRATIONS IN THE PRICE OF THE TARGET COMPANY'S SECURITIES. TRADING DURING THIS
TIME PERIOD IS MORE LIKELY TO ATTRACT REGULATORY ATTENTION (AND PRODUCES A
DISPROPORTIONATE PERCENTAGE OF INSIDER TRADING CASES). SECOND, THE SEC HAS
ADOPTED A RULE WHICH EXPRESSLY FORBIDS TRADING AND "TIPPING" WHILE IN POSSESSION
OF MATERIAL, NONPUBLIC INFORMATION REGARDING A TENDER OFFER RECEIVED FROM THE
TENDER OFFEROR, THE TARGET COMPANY OR ANYONE ACTING ON BEHALF OF EITHER. CALVERT
EMPLOYEES AND OTHERS SUBJECT TO THIS POLICY STATEMENT SHOULD EXERCISE PARTICULAR
CAUTION ANY TIME THEY BECOME AWARE OF NONPUBLIC INFORMATION RELATING TO A TENDER
OFFER.
6. EDUCATION
ANOTHER ASPECT OF CALVERT'S COMPLIANCE PROCEDURES WILL BE TO KEEP CALVERT
PERSONNEL AND OTHER ACCESS PERSONS INFORMED. THIS MEMORANDUM SERVES AS A BASIC
PRIMER ON WHAT CONSTITUTES INSIDE INFORMATION AND PERIODIC MEMORANDA WILL BE
DISTRIBUTED, PARTICULARLY WHEN A SIGNIFICANT CASE DEALING WITH THE SUBJECT HAS
BEEN DECIDED.
ALL NEW EMPLOYEES WILL BE GIVEN A COPY OF THIS STATEMENT AND WILL BE
REQUIRED TO READ IT AND AGREE TO ITS CONDITIONS. ALL EMPLOYEES WILL BE REQUIRED
TO CONFIRM THEIR UNDERSTANDING AND ACKNOWLEDGMENT OF THE STATEMENT ON AN ANNUAL
BASIS.
<PAGE>
ATTACHMENT A
[GRAPHIC OMITED]
MEMO
TO: LEGAL DEPARTMENT; COMPLIANCE
FROM:
RE: PRIOR APPROVAL OF ACCESS PERSON TRADING IN SECURITIES
THE FOLLOWING PROPOSED SECURITY(IES) TRANSACTION(S) WAS (WERE) REVIEWED BY THE
FUND, OR DESIGNATED EMPLOYEE OF THE ADVISOR (CHIEF INVESTMENT OFFICER OR
DIRECTOR OF RESEARCH) PURSUANT TO CALVERT GROUP'S CODE OF ETHICS:
NAME OF ADVISORY PERSON:
SECURITY (IES) TO BE PURCHASED OR SOLD:
BASIS OF APPROVAL OR DENIAL:
FUND OR ADVISOR DESIGNEE SIGNATURE
SIGNATURE PAGE
CODE OF ETHICS AND INSIDER TRADING POLICY AND PROCEDURES
ACKNOWLEDGEMENT FORM
I HAVE READ AND UNDERSTAND CALVERT GROUP'S CODE OF ETHICS AND INSIDER TRADING
POLICY AND PROCEDURES AND WILL COMPLY IN ALL RESPECTS WITH SUCH PROCEDURES.
SIGNATURE DATE
PRINT NAME
<PAGE>
ATTACHMENT B
ACCESS PERSONS SUBJECT TO PRECLEARANCE FOR SECURITIES TRANSACTIONS INCLUDING
PRIVATE PLACEMENTS
MICHAEL ABRAMO
FATIMA BATALVI
SUSAN BENDER
YING-WEI CHEN
TOM DAILEY
IVY DUKE
PATRICK FAUL
VICTOR FRYE
DAVID GIBSON
CEASAR GONZALES
DONNA GOMEZ
GREG HABEEB
DAN HAYES
HUI PING HO
MOHAMMED JAVAID
ANU KHONDOKAR
TRACY KNIGHT
BARBARA KRUMSIEK
EMMETT LONG
RENO MARTINI
GARY MILLER
JOHN NICHOLS
MATT NOTTINGHAM
KENDRA PLEMMONS
CARMEN REID
CHRIS SANTOS
BILL TARTIKOFF
LAURIE WEBSTER
RON WOLFSHEIMER
MIKE YUHAS
INVESTMENT PERSONNEL SUBJECT SOLEY TO PRIVATE PLACEMENT PRECLEARANCE
MEMBERS OF THE SPECIAL EQUITIES COMMITTEE OF THE BOARD OF DIRECTORS/TRUSTEES
The term "entity" will be used for any organization adopting these procedures.
For those organizations which are investment companies as defined under the
Investment Company Act of 1940, the term "Fund" may also be used if applicable.
Access person means any director/trustee, officer, general partner, or employee
of any entity adopting these procedures who participates in the selection of
securities (other than high social impact securities or special equity
securities) or who has access to information regarding impending purchases or
sales [See rule 17 j-1(e)]. The General Counsel or Compliance Officer may
designate any person, including an independent contractor or consultant, as an
access person, who, as such, shall provide signed acknowledgement of the receipt
of these procedures and their applicability. A current list of access persons
and investment personnel subject to preclearance or other requirements shall be
maintained by the Compliance Officer.
For this purpose, "securities" include options on securities and securities that
are convertible into or exchangeable for securities held or to be acquired by a
fund. A security is being considered for purchase once a recommendation has
been documented, communicated and under serious evaluation by the purchaser or
seller. Evidence of consideration may include such things as approved
recommendations in current research reports, pending or active order tickets,
and a watch list of securities under current evaluation.
Disinterested Directors and/or Trustees as defined by the Investment Company Act
of 1940, are excluded from the duplicate statement and confirmation requirement
unless the General Counsel or Compliance Officer imposes a different standard
due to an entity's active trading strategy and/or the information available to
the Disinterested Directors and/or Trustees.
All account information is subject to regulatory review. The trade confirmations
of persons other than disinterested directors or trustees may be disclosed to
other senior officers of the Fund or to legal counsel as deemed necessary for
compliance purposes and to otherwise administer the Code of Ethics.
