<PAGE> PAGE 1
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007 C010700 7
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011 C01AA01 BOSTON
011 C02AA01 MA
011 C03AA01 02199
011 C04AA01 7603
012 A00AA01 JOHN HANCOCK SIGNATURE SERVICES, INC.
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012 C01AA01 BOSTON
<PAGE> PAGE 2
012 C02AA01 MA
012 C03AA01 02199
012 C04AA01 7603
013 A00AA01 PRICEWATERHOUSECOOPERS LLP
013 B01AA01 BOSTON
013 B02AA01 MA
013 B03AA01 02110
014 A00AA01 SIGNATOR INVESTORS, INC.
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014 A00AA02 JOHN HANCOCK FUNDS, INC.
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<PAGE> PAGE 3
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<PAGE> PAGE 4
054 D00AA00 N
054 E00AA00 N
054 F00AA00 N
054 G00AA00 Y
054 H00AA00 Y
054 I00AA00 N
054 J00AA00 Y
054 K00AA00 N
054 L00AA00 N
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054 N00AA00 N
054 O00AA00 N
055 A00AA00 N
055 B00AA00 N
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<PAGE> PAGE 5
082 A00AA00 N
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083 B00AA00 0
084 A00AA00 N
084 B00AA00 0
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015 A000101 INVESTORS BANK & TRUST COMPANY
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015 C020101 MA
015 C030101 02111
015 E010101 X
015 A000102 CITIBANK, N.A. (ARGENTINA)
015 B000102 S
015 C010102 BUENOS AIRES
015 D010102 ARGENTINA
015 E040102 X
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015 B000103 S
015 C010103 MELBOURNE
015 D010103 AUSTRALIA
015 E040103 X
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015 B000104 S
015 C010104 VIENNA
015 D010104 AUSTRIA
015 E040104 X
015 A000105 PARIBAS
015 B000105 S
015 C010105 BRUSSELS
015 D010105 BELGIUM
015 E040105 X
015 A000106 ROYAL BANK OF CANADA
015 B000106 S
015 C010106 TORONTO
015 D010106 CANADA
015 E040106 X
<PAGE> PAGE 6
015 A000107 UNIBANK, A.S.
015 B000107 S
015 C010107 COPENHAGEN
015 D010107 DENMARK
015 E040107 X
015 A000108 EUROCLEAR/KANSALLIS-OSAKE-PANKKI
015 B000108 S
015 C010108 HELSINKI
015 D010108 FINLAND
015 E040108 X
015 A000109 PARIBAS
015 B000109 S
015 C010109 PARIS
015 D010109 FRANCE
015 E040109 X
015 A000110 EUROCLEAR/DEUTSCHE BANK A.G.
015 B000110 S
015 C010110 FRANKFURT
015 D010110 GERMANY
015 E040110 X
015 A000111 PARIBAS
015 B000111 S
015 C010111 ATHENS
015 D010111 GREECE
015 E040111 X
015 A000112 STANDARD CHARTERED BANK, HONG KONG
015 B000112 S
015 C010112 HONG KONG
015 D010112 HONG KONG
015 E040112 X
015 A000113 STANDARD CHARTERED BANK, JAKARTA
015 B000113 S
015 C010113 JAKARTA
015 D010113 INDONESIA
015 E040113 X
015 A000114 BANK OF IRELAND SECURITIES SERVICES
015 B000114 S
015 C010114 DUBLIN
015 D010114 IRELAND
015 E040114 X
015 A000115 PARIBAS
015 B000115 S
015 C010115 MILAN
015 D010115 ITALY
015 E040115 X
015 A000116 STANDARD CHARTERED BANK, TOKYO
015 B000116 S
015 C010116 TOKYO
015 D010116 JAPAN
015 E040116 X
015 A000117 STANDARD CHARTERED BANK, SEOUL
<PAGE> PAGE 7
015 B000117 S
015 C010117 SEOUL
015 D010117 KOREA
015 E040117 X
015 A000118 STANDARD CHARTERED BANK MALAYSIA BERHAD
015 B000118 S
015 C010118 KUALA LAMPUR
015 D010118 MALAYSIA
015 E040118 X
015 A000119 BANCOMER, S.A.
015 B000119 S
015 C010119 MEXICO CITY
015 D010119 MEXICO
015 E040119 X
015 A000120 MEESPIERSON
015 B000120 S
015 C010120 AMSTERDAM
015 D010120 NETHERLANDS
015 E040120 X
015 A000121 NATIONAL NOMINEES LIMITED
015 B000121 S
015 C010121 WELLINGTON
015 D010121 NEW ZEALAND
015 E040121 X
015 A000122 UNION BANK OF NORWAY
015 B000122 S
015 C010122 OSLO
015 D010122 NORWAY
015 E040122 X
015 A000123 STANDARD CHARTERED BANK, MANILA
015 B000123 S
015 C010123 MANILA
015 D010123 PHILIPPINES
015 E040123 X
015 A000124 CITIBANK PORTUGAL S.A.
015 B000124 S
015 C010124 LISBON
015 D010124 PORTUGAL
015 E040124 X
015 A000125 STANDARD CHARTERED BANK, SINGAPORE
015 B000125 S
015 C010125 SINGAPORE
015 D010125 SINGAPORE
015 E040125 X
015 A000126 PARIBAS
015 B000126 S
015 C010126 MADRID
015 D010126 SPAIN
015 E040126 X
015 A000127 SVENSKA HANDELSBANKEN
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<PAGE> PAGE 8
015 C010127 STOCKHOLM
015 D010127 SWEDEN
015 E040127 X
015 A000128 BANK LEU LTD.
015 B000128 S
015 C010128 ZURICH
015 D010128 SWITZERLAND
015 E040128 X
015 A000129 STANDARD CHARTERED BANK, TAIPEI
015 B000129 S
015 C010129 TAIPEI
015 D010129 TAIWAN
015 E040129 X
015 A000130 STANDARD CHARTERED BANK, BANGKOK
015 B000130 S
015 C010130 BANGKOK
015 D010130 THAILAND
015 E040130 X
015 A000131 OTTOMAN BANK
015 B000131 S
015 C010131 ISTANBUL
015 D010131 TURKEY
015 E040131 X
015 A000132 HSB PLC
015 B000132 S
015 C010132 LONDON
015 D010132 UNITED KINGDOM
015 E040132 X
015 A000133 CITIBANK, N.A. (CARACAS)
015 B000133 S
015 C010133 CARACAS
015 D010133 VENEZUELA
015 E040133 X
015 A000134 BANKBOSTON BRAZIL
015 B000134 S
015 C010134 SAO PAULO
015 D010134 BRAZIL
015 E040134 X
015 A000135 HSBC BANK MIDDLE EAST
015 B000135 S
015 C010135 MANAMA
015 D010135 BAHRAIN
015 E040135 X
015 A000136 CITITRUST COLOMBIA S.A. (COLOMBIA)
015 B000136 S
015 C010136 BOGOTA
015 D010136 COLOMBIA
015 E040136 X
015 A000137 STANDARD CHARTERED BANK, KARACHI
015 B000137 S
015 C010137 KARACHI
<PAGE> PAGE 9
015 D010137 PAKISTAN
015 E040137 X
015 A000138 STANDARD CHARTERED BANK, COLOMBO
015 B000138 S
015 C010138 COLOMBO
015 D010138 SRI LANKA
015 E040138 X
015 A000139 STANDARD CHARTERED BANK, SHENZHEN
015 B000139 S
015 C010139 SHENZHEN
015 D010139 CHINA
015 E040139 X
015 A000140 STANDARD CHARTERED BANK, DHAKA
015 B000140 S
015 C010140 DHAKA
015 D010140 BANGLADESH
015 E040140 X
015 A000141 STANDARD CHARTERED BANK, SHANGHAI
015 B000141 S
015 C010141 SHANGHAI
015 D010141 CHINA
015 E040141 X
015 A000142 CITIBANK BUDAPEST RT
015 B000142 S
015 C010142 BUDAPEST
015 D010142 HUNGARY
015 E040142 X
015 A000143 BANKAUSTRIA CREDITANSTALT
015 B000143 S
015 C010143 ZAGREB
015 D010143 CROATIA
015 E040143 X
015 A000144 CITIBANK, A.S.
015 B000144 S
015 C010144 PRAGUE
015 D010144 CZECH REPUBLIC
015 E040144 X
015 A000145 EUROCLEAR/BANQUE ET CAISSE D'EPARGNE DE LETAT
015 B000145 S
015 C010145 LUXEMBOURG
015 D010145 LUXEMBOURG
015 E040145 X
015 A000146 CITIBANK, N.A. (PERU)
015 B000146 S
015 C010146 LIMA
015 D010146 PERU
015 E040146 X
015 A000147 BANK POLSKA (PEKAO)
015 B000147 S
015 C010147 WARSAW
015 D010147 POLAND
<PAGE> PAGE 10
015 E040147 X
015 A000148 THE STANDARD BANK OF SOUTH AFRICA LIMITED
015 B000148 S
015 C010148 CAPETOWN, PRETORIA
015 D010148 SOUTH AFRICA
015 E040148 X
015 A000149 BARCLAYS BANK OF BOTSWANA LTD.
015 B000149 S
015 C010149 GARBORONE
015 D010149 BOTSWANA
015 E040149 X
015 A000150 HANSABANK
015 B000150 S
015 C010150 TALLIN
015 D010150 ESTONIA
015 E040150 X
015 A000151 BARCLAYS BANK OF GHANA LTD.
015 B000151 S
015 C010151 ACCRA
015 D010151 GHANA
015 E040151 X
015 A000152 CITIBANK, N.A. (JORDAN)
015 B000152 S
015 C010152 AMMAN
015 D010152 JORDAN
015 E040152 X
015 A000153 BARCLAYS BANK PLC
015 B000153 S
015 C010153 LUSAKA
015 D010153 ZAMBIA
015 E040153 X
015 A000154 BARCLAYS BANK PLC
015 B000154 S
015 C010154 HARARE
015 D010154 ZIMBABWE
015 E040154 X
015 A000155 CITIBANK, N.A. (EGYPT)
015 B000155 S
015 C010155 CAIRO
015 D010155 EGYPT
015 E040155 X
015 A000156 BANK HAPOALIM B.M.
015 B000156 S
015 C010156 JERUSALEM
015 D010156 ISRAEL
015 E040156 X
015 A000157 HONGKONG SHANGHAI BANKING CORP.
015 B000157 S
015 C010157 PORT LOUIS
015 D010157 MAURITIUS
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<PAGE> PAGE 11
015 A000158 CITIBANK - MAGHREB
015 B000158 S
015 C010158 RABAT
015 D010158 MOROCCO
015 E040158 X
015 A000159 CESKOSLOVENSKA OBCHODNA BANKA A.S.
015 B000159 S
015 C010159 BRATISLAVA
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015 E040159 X
015 A000160 CITIBANK, N.A. (ECUADOR)
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015 C010160 QUITO
015 D010160 ECUADOR
015 E040160 X
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015 B000161 S
015 C010161 MOSCOW
015 D010161 RUSSIA
015 E040161 X
015 A000162 THE DEPOSITORY AND CLEARING CENTRE
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015 C010162 LONDON
015 D010162 UNITED KINGDOM
015 E040162 X
015 A000163 EUROCLEAR/DEUTSCHE BANK A.G.
015 B000163 S
015 C010163 FRANKFURT
015 D010163 GERMANY
015 E040163 X
015 A000164 ANZ GRINDLAYS BANK
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015 D010164 INDIA
015 E040164 X
015 A000165 THE BANK OF BERMUDA LIMITED
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015 C010165 HAMILTON
015 D010165 BERMUDA
015 E040165 X
015 A000166 HANSABANK
015 B000166 S
015 C010166 RIGA
015 D010166 LATVIA
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015 A000167 HSBC BANK MIDDLE EAST
015 B000167 S
015 C010167 BEIRUT
015 D010167 LEBANON
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<PAGE> PAGE 12
015 B000168 S
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015 D010168 LITHUANIA
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<PAGE> PAGE 13
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<PAGE> PAGE 14
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<PAGE> PAGE 15
070 C020100 N
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<PAGE> PAGE 16
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<PAGE> PAGE 17
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015 A000601 INVESTORS BANK & TRUST COMPANY
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<PAGE> PAGE 18
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048 J010600 0
048 J020600 0.000
048 K010600 500000
048 K020600 0.450
062 A000600 Y
062 B000600 0.0
062 C000600 0.0
062 D000600 8.3
062 E000600 0.0
062 F000600 0.0
062 G000600 0.0
062 H000600 0.0
062 I000600 0.0
062 J000600 0.0
062 K000600 0.0
062 L000600 -12.9
062 M000600 32.4
062 N000600 72.2
062 O000600 0.0
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<PAGE> PAGE 19
062 Q000600 0.0
062 R000600 0.0
063 A000600 0
063 B000600 8.5
064 A000600 N
064 B000600 N
070 A010600 Y
070 A020600 Y
070 B010600 N
070 B020600 N
070 C010600 Y
070 C020600 N
070 D010600 Y
070 D020600 N
070 E010600 Y
070 E020600 Y
070 F010600 Y
070 F020600 N
070 G010600 Y
070 G020600 N
070 H010600 Y
070 H020600 N
070 I010600 N
070 I020600 N
070 J010600 Y
070 J020600 N
070 K010600 Y
070 K020600 N
070 L010600 Y
070 L020600 Y
070 M010600 N
070 M020600 N
070 N010600 Y
070 N020600 N
070 O010600 Y
070 O020600 N
070 P010600 Y
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070 Q020600 N
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070 R020600 N
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<PAGE> PAGE 20
072 F000600 956
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<PAGE> PAGE 21
074 R030600 0
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SIGNATURE SUSAN S. NEWTON
TITLE VICE PRESIDENT
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</TABLE>
AMENDED AND RESTATED
DECLARATION OF TRUST
OF
JOHN HANCOCK STRATEGIC SERIES
101 Huntington Avenue
Boston, Massachusetts
02199-7603
Dated June 8, 1999
Table of Contents
Page
ARTICLE I - NAME AND DEFINITIONS 1
Section 1.1. Name 1
Section 1.2. Definitions 1
ARTICLE II - TRUSTEES 3
Section 2.1. General Powers 3
Section 2.2. Investments 4
Section 2.3. Legal Title 6
Section 2.4. Issuance and Repurchase of Shares. 6
Section 2.5. Delegation; Committees 6
Section 2.6. Collection and Payment 6
Section 2.7. Expenses 6
Section 2.8. Manner of Acting; By-laws 6
Section 2.9. Miscellaneous Powers 7
Section 2.10. Principal Transactions 7
Section 2.11. Litigation. 8
Section 2.12. Number of Trustees 8
Section 2.13. Election and Term 8
Section 2.14. Resignation and Removal 8
Section 2.15. Vacancies 8
Section 2.16. Delegation of Power to Other Trustees 9
ARTICLE III - CONTRACTS 9
Section 3.1. Distribution Contract 9
Section 3.2. Advisory or Management Contract 9
Section 3.3. Administration Agreement 10
Section 3.4. Service Agreement 10
Section 3.5. Transfer Agent 10
Section 3.6. Custodian. 10
Section 3.7. Affiliations of Trustees or Officers, Etc. 11
Section 3.8. Compliance with 1940 Act 11
ARTICLE IV - LIMITATIONS OF LIABILITY OF SHAREHOLDERS,
TRUSTEES AND OTHERS 11
Section 4.1. No Personal Liability of Shareholders, Trustees,
Etc 11
Section 4.2. Non-Liability of Trustees, Etc. 12
Section 4.3. Mandatory Indemnification 12
Section 4.4. No Bond Required of Trustees 14
Section 4.5. No Duty of Investigation; Notice in Trust
Instruments, Etc. 14
Section 4.6. Reliance on Experts, Etc. 14
ARTICLE V - SHARES OF BENEFICIAL INTEREST 15
Section 5.1. Beneficial Interest 15
Section 5.2. Rights of Shareholders 15
Section 5.3. Trust Only 15
Section 5.4. Issuance of Shares 15
Section 5.5. Register of Shares 16
Section 5.6. Transfer of Shares 16
Section 5.7. Notices 16
Section 5.8. Treasury Shares 16
Section 5.9. Voting Powers 16
Section 5.10. Meetings of Shareholders 17
Section 5.11. Series or Class Designation 17
Section 5.12. Assent to Declaration of Trust 20
ARTICLE VI - REDEMPTION AND REPURCHASE OF SHARES 20
Section 6.1. Redemption of Shares 20
Section 6.2. Price 21
Section 6.3. Payment. 21
Section 6.4. Effect of Suspension of Determination of Net Asset
Value 21
Section 6.5. Repurchase by Agreement. 21
Section 6.6. Redemption of Shareholder's Interest. 21
Section 6.7. Redemption of Shares in Order to Qualify as
Regulated Investment Company;
Disclosure of Holding 22
Section 6.8. Reductions in Number of Outstanding Shares Pursuant
to Net
Asset Value Formula 22
Section 6.9. Suspension of Right of Redemption 22
ARTICLE VII - DETERMINATION OF NET ASSET VALUE, NET INCOME AND
DISTRIBUTIONS 23
Section 7.1. Net Asset Value 23
Section 7.2. Distributions to Shareholders. 23
Section 7.3. Determination of Net Income; Constant Net Asset
Value; Reduction
of Outstanding Shares 24
Section 7.4. Power to Modify Foregoing Procedures 25
ARTICLE VIII - DURATION; TERMINATION OF TRUST OR A SERIES OR
CLASS;
AMENDMENT; MERGERS, ETC. 25
Section 8.1. Duration. 25
Section 8.2. Termination of the Trust or a Series or a Class
25
Section 8.3. Amendment Procedure. 26
Section 8.4. Merger, Consolidation and Sale of Assets 27
Section 8.5. Incorporation. 27
ARTICLE IX - REPORTS TO SHAREHOLDERS 28
ARTICLE X - MISCELLANEOUS 28
Section 10.1. Execution and Filing. 28
Section 10.2. Governing Law. 28
Section 10.3. Counterparts 28
Section 10.4. Reliance by Third Parties 29
Section 10.5. Provisions in Conflict with Law or Regulations
29
Amended and Restated
Declaration of Trust
of
John Hancock Strategic Series
Dated June 8, 1999
DECLARATION OF TRUST made this 8th day of June, 1999 by the
undersigned (together with all other persons from time to time
duly elected, qualified and serving as Trustees in accordance
with the provisions of Article II hereof, the "Trustees");
WHEREAS, pursuant to an amended and restated declaration of
trust executed and delivered on September 21, 1993 (the "Original
Declaration"), the Trustees established a trust for the
investment and reinvestment of funds contributed thereto;
WHEREAS, the Trustees divided the beneficial interest in the
trust assets into transferable shares of beneficial interest, as
provided therein;
WHEREAS, the Trustees declared that all money and property
contributed to the trust established thereunder be held and
managed in trust for the benefit of the holders, from time to
time, of the shares of beneficial interest issued thereunder and
subject to the provisions thereof;
WHEREAS, the Trustees desire to amend and restate the
Original Declaration;
NOW, THEREFORE, in consideration of the foregoing premises
and the agreements contained herein, the undersigned, being a
majority of the Trustees of the trust, hereby amend and restate
the Original Declaration as follows:
ARTICLE I
NAME AND DEFINITIONS
Section 1.1. Name. The name of the trust created hereby is
"John Hancock Strategic Series" (the "Trust").
Section 1.2. Definitions. Wherever they are used herein,
the following terms have the following respective meanings:
(a) "Administrator" means the party, other than the Trust,
to the contract described in Section 3.3 hereof.
(b) "By-laws" means the By-laws referred to in Section 2.8
hereof, as amended from time to time.
(c) "Class" means any division of shares within a Series in
accordance with the provisions of Article V.
(d) The terms "Commission" and "Interested Person" have the
meanings given them in the 1940 Act. Except as such term may be
otherwise defined by the Trustees in conjunction with the
establishment of any Series, the term "vote of a majority of the
Outstanding Shares entitled to vote" shall have the same meaning
as is assigned to the term "vote of a majority of the outstanding
voting securities" in the 1940 Act.
(e) "Custodian" means any Person other than the Trust who
has custody of any Trust Property as required by Section 17(f) of
the 1940 Act, but does not include a system for the central
handling of securities described in said Section 17(f).
(f) "Declaration" means this Declaration of Trust as
amended from time to time. Reference in this Declaration of
Trust to "Declaration," "hereof," "herein," and "hereunder" shall
be deemed to refer to this Declaration rather than exclusively to
the article or section in which such words appear.
(g) "Distributor" means the party, other than the Trust, to
the contract described in Section 3.1 hereof.
(h) "Fund" or "Funds" individually or collectively, means
the separate Series of the Trust, together with the assets and
liabilities assigned thereto.
(i) "Fundamental Restrictions" means the investment
restrictions set forth in the Prospectus and Statement of
Additional Information for any Series and designated as
fundamental restrictions therein with respect to such Series.
(j) "His" shall include the feminine and neuter, as well as
the masculine, genders.
(k) "Investment Adviser" means the party, other than the
Trust, to the contract described in Section 3.2 hereof.
(l) The "1940 Act" means the Investment Company Act of
1940, as amended from time to time.
(m) "Person" means and includes individuals, corporations,
partnerships, trusts, associations, joint ventures and other
entities, whether or not legal entities, and governments and
agencies and political subdivisions thereof.
(n) "Prospectus" means the Prospectuses and Statements of
Additional Information included in the Registration Statement of
the Trust under the Securities Act of 1933, as amended, as such
Prospectuses and Statements of Additional Information may be
amended or supplemented and filed with the Commission from time
to time.
(o) "Series" individually or collectively means the
separately managed component(s) of the Trust (or, if the Trust
shall have only one such component, then that one) as may be
established and designated from time to time by the Trustees
pursuant to Section 5.11 hereof.
(p) "Shareholder" means a record owner of Outstanding
Shares.
(q) "Shares" means the equal proportionate units of
interest into which the beneficial interest in the Trust shall be
divided from time to time, including the Shares of any and all
Series or of any Class within any Series (as the context may
require) which may be established by the Trustees, and includes
fractions of Shares as well as whole Shares. "Outstanding"
Shares means those Shares shown from time to time on the books of
the Trust or its Transfer Agent as then issued and outstanding,
but shall not include Shares which have been redeemed or
repurchased by the Trust and which are at the time held in the
treasury of the Trust.
(r) "Transfer Agent" means any Person other than the Trust
who maintains the Shareholder records of the Trust, such as the
list of Shareholders, the number of Shares credited to each
account, and the like.
(s) "Trust" means John Hancock Strategic Series.
(t) "Trustees" means the persons who have signed this
Declaration, so long as they shall continue in office in
accordance with the terms hereof, and all other persons who now
serve or may from time to time be duly elected, qualified and
serving as Trustees in accordance with the provisions of Article
II hereof, and reference herein to a Trustee or the Trustees
shall refer to such person or persons in this capacity or their
capacities as trustees hereunder.
(u) "Trust Property" means any and all property, real or
personal, tangible or intangible, which is owned or held by or
for the account of the Trust or the Trustees, including any and
all assets of or allocated to any Series or Class, as the context
may require.
ARTICLE II
TRUSTEES
Section 2.1. General Powers. The Trustees shall have
exclusive and absolute control over the Trust Property and over
the business of the Trust to the same extent as if the Trustees
were the sole owners of the Trust Property and business in their
own right, but with such powers of delegation as may be permitted
by this Declaration. The Trustees shall have power to conduct
the business of the Trust and carry on its operations in any and
all of its branches and maintain offices both within and without
The Commonwealth of Massachusetts, in any and all states of the
United States of America, in the District of Columbia, and in any
and all commonwealths, territories, dependencies, colonies,
possessions, agencies or instrumentalities of the United States
of America and of foreign governments, and to do all such other
things and execute all such instruments as they deem necessary,
proper or desirable in order to promote the interests of the
Trust although such things are not herein specifically mentioned.
Any determination as to what is in the interests of the Trust
made by the Trustees in good faith shall be conclusive. In
construing the provisions of this Declaration, the presumption
shall be in favor of a grant of power to the Trustees.
The enumeration of any specific power herein shall not be
construed as limiting the aforesaid powers. Such powers of the
Trustees may be exercised without order of or resort to any
court.
Section 2.2. Investments. The Trustees shall have the
power:
(a) To operate as and carry on the business of an
investment company, and exercise all the powers necessary and
appropriate to the conduct of such operations.
(b) To invest in, hold for investment, or reinvest in,
cash; securities, including common, preferred and preference
stocks; warrants; subscription rights; profit-sharing interests
or participations and all other contracts for or evidence of
equity interests; bonds, debentures, bills, time notes and all
other evidences of indebtedness; negotiable or non-negotiable
instruments; government securities, including securities of any
state, municipality or other political subdivision thereof, or
any governmental or quasi-governmental agency or instrumentality;
and money market instruments including bank certificates of
deposit, finance paper, commercial paper, bankers' acceptances
and all kinds of repurchase agreements, of any corporation,
company, trust, association, firm or other business organization
however established, and of any country, state, municipality or
other political subdivision, or any governmental or quasi-
governmental agency or instrumentality; any other security,
instrument or contract the acquisition or execution of which is
not prohibited by any Fundamental Restriction; and the Trustees
shall be deemed to have the foregoing powers with respect to any
additional securities in which the Trust may invest should the
Fundamental Restrictions be amended.
(c) To acquire (by purchase, subscription or otherwise), to
hold, to trade in and deal in, to acquire any rights or options
to purchase or sell, to sell or otherwise dispose of, to lend and
to pledge any such securities, to enter into repurchase
agreements, reverse repurchase agreements, firm commitment
agreements, forward foreign currency exchange contracts, interest
rate, mortgage or currency swaps, and interest rate caps, floors
and collars, to purchase and sell options on securities, indices,
currency, swaps or other financial assets, futures contracts and
options on futures contracts of all descriptions and to engage in
all types of hedging, risk management or income enhancement
transactions.
(d) To exercise all rights, powers and privileges of
ownership or interest in all securities and repurchase agreements
included in the Trust Property, including the right to vote
thereon and otherwise act with respect thereto and to do all acts
for the preservation, protection, improvement and enhancement in
value of all such securities and repurchase agreements.
(e) To acquire (by purchase, lease or otherwise) and to
hold, use, maintain, develop and dispose of (by sale or
otherwise) any property, real or personal, including cash or
foreign currency, and any interest therein.
(f) To borrow money and in this connection issue notes or
other evidence of indebtedness; to secure borrowings by
mortgaging, pledging or otherwise subjecting as security the
Trust Property; and to endorse, guarantee, or undertake the
performance of any obligation or engagement of any other Person
and to lend Trust Property.
(g) To aid by further investment any corporation, company,
trust, association or firm, any obligation of or interest in
which is included in the Trust Property or in the affairs of
which the Trustees have any direct or indirect interest; to do
all acts and things designed to protect, preserve, improve or
enhance the value of such obligation or interest; and to
guarantee or become surety on any or all of the contracts,
stocks, bonds, notes, debentures and other obligations of any
such corporation, company, trust, association or firm.
(h) To enter into a plan of distribution and any related
agreements whereby the Trust may finance directly or indirectly
any activity which is primarily intended to result in the
distribution and/or servicing of Shares.
(i) To adopt on behalf of the Trust or any Series thereof
an alternative purchase plan providing for the issuance of
multiple Classes of Shares (as authorized herein at Section
5.11).
(j) In general to carry on any other business in connection
with or incidental to any of the foregoing powers, to do
everything necessary, suitable or proper for the accomplishment
of any purpose or the attainment of any object or the furtherance
of any power hereinbefore set forth, either alone or in
association with others, and to do every other act or thing
incidental or appurtenant to or arising out of or connected with
the aforesaid business or purposes, objects or powers.
The foregoing clauses shall be construed both as objects and
powers, and the foregoing enumeration of specific powers shall
not be held to limit or restrict in any manner the general powers
of the Trustees.
Notwithstanding any other provision herein, the Trustees
shall have full power in their discretion as contemplated in
Section 8.5, without any requirement of approval by Shareholders,
to invest part or all of the Trust Property (or part or all of
the assets of any Series), or to dispose of part or all of the
Trust Property (or part or all of the assets of any Series) and
invest the proceeds of such disposition, in securities issued by
one or more other investment companies registered under the 1940
Act. Any such other investment company may (but need not) be a
trust (formed under the laws of any state) which is classified as
a partnership or corporation for federal income tax purposes.
The Trustees shall not be limited to investing in
obligations maturing before the possible termination of the
Trust, nor shall the Trustees be limited by any law limiting the
investments which may be made by fiduciaries.
Section 2.3. Legal Title. Legal title to all the Trust
Property shall be vested in the Trustees as joint tenants except
that the Trustees shall have power to cause legal title to any
Trust Property to be held by or in the name of one or more of the
Trustees, or in the name of the Trust or any Series of the Trust,
or in the name of any other Person as nominee, on such terms as
the Trustees may determine, provided that the interest of the
Trust therein is deemed appropriately protected. The right,
title and interest of the Trustees in the Trust Property and the
Property of each Series of the Trust shall vest automatically in
each Person who may hereafter become a Trustee. Upon the
termination of the term of office, resignation, removal or death
of a Trustee he shall automatically cease to have any right,
title or interest in any of the Trust Property, and the right,
title and interest of such Trustee in the Trust Property shall
vest automatically in the remaining Trustees. Such vesting and
cessation of title shall be effective whether or not conveyancing
documents have been executed and delivered.
Section 2.4. Issuance and Repurchase of Shares. The
Trustees shall have the power to issue, sell, repurchase, redeem,
retire, cancel, acquire, hold, resell, reissue, dispose of,
transfer, and otherwise deal in Shares and, subject to the
provisions set forth in Articles VI and VII and Section 5.11
hereof, to apply to any such repurchase, redemption, retirement,
cancellation or acquisition of Shares any funds or property of
the Trust or of the particular Series with respect to which such
Shares are issued, whether capital or surplus or otherwise, to
the full extent now or hereafter permitted by the laws of The
Commonwealth of Massachusetts governing business corporations.
Section 2.5. Delegation; Committees. The Trustees shall
have power, consistent with their continuing exclusive authority
over the management of the Trust and the Trust Property, to
delegate from time to time to such of their number or to
officers, employees or agents of the Trust the doing of such
things and the execution of such instruments either in the name
of the Trust or any Series of the Trust or the names of the
Trustees or otherwise as the Trustees may deem expedient, to the
same extent as such delegation is permitted by the 1940 Act.
Section 2.6. Collection and Payment. The Trustees shall
have power to collect all property due to the Trust; to pay all
claims, including taxes, against the Trust Property; to
prosecute, defend, compromise or abandon any claims relating to
the Trust Property; to foreclose any security interest securing
any obligations, by virtue of which any property is owed to the
Trust; and to enter into releases, agreements and other
instruments.
Section 2.7. Expenses. The Trustees shall have the power
to incur and pay any expenses which in the opinion of the
Trustees are necessary or incidental to carry out any of the
purposes of this Declaration, and to pay reasonable compensation
from the funds of the Trust to themselves as Trustees. The
Trustees shall fix the compensation of all officers, employees
and Trustees.
Section 2.8. Manner of Acting; By-laws. Except as
otherwise provided herein or in the By-laws, any action to be
taken by the Trustees may be taken by a majority of the Trustees
present at a meeting of Trustees, including any meeting held by
means of a conference telephone circuit or similar communications
equipment by means of which all persons participating in the
meeting can hear each other, or by written consents of a majority
of Trustees then in office. The Trustees may adopt By-laws not
inconsistent with this Declaration to provide for the conduct of
the business of the Trust and may amend or repeal such By-laws to
the extent such power is not reserved to the Shareholders.
Notwithstanding the foregoing provisions of this Section 2.8
and in addition to such provisions or any other provision of this
Declaration or of the By-laws, the Trustees may by resolution
appoint a committee consisting of less than the whole number of
Trustees then in office, which committee may be empowered to act
for and bind the Trustees and the Trust, as if the acts of such
committee were the acts of all the Trustees then in office, with
respect to the institution, prosecution, dismissal, settlement,
review or investigation of any action, suit or proceeding which
shall be pending or threatened to be brought before any court,
administrative agency or other adjudicatory body.
Section 2.9. Miscellaneous Powers. The Trustees shall have
the power to: (a) employ or contract with such Persons as the
Trustees may deem desirable for the transaction of the business
of the Trust or any Series thereof; (b) enter into joint
ventures, partnerships and any other combinations or
associations; (c) remove Trustees, fill vacancies in, add to or
subtract from their number, elect and remove such officers and
appoint and terminate such agents or employees as they consider
appropriate, and appoint from their own number, and terminate,
any one or more committees which may exercise some or all of the
power and authority of the Trustees as the Trustees may
determine; (d) purchase, and pay for out of Trust Property or the
property of the appropriate Series of the Trust, insurance
policies insuring the Shareholders, Trustees, officers,
employees, agents, investment advisers, administrators,
distributors, selected dealers or independent contractors of the
Trust against all claims arising by reason of holding any such
position or by reason of any action taken or omitted by any such
Person in such capacity, whether or not constituting negligence,
or whether or not the Trust would have the power to indemnify
such Person against such liability; (e) establish pension,
profit-sharing, share purchase, and other retirement, incentive
and benefit plans for any Trustees, officers, employees and
agents of the Trust; (f) to the extent permitted by law,
indemnify any person with whom the Trust or any Series thereof
has dealings, including the Investment Adviser, Administrator,
Distributor, Transfer Agent and selected dealers, to such extent
as the Trustees shall determine; (g) guarantee indebtedness or
contractual obligations of others; (h) determine and change the
fiscal year and taxable year of the Trust or any Series thereof
and the method by which its or their accounts shall be kept; and
(i) adopt a seal for the Trust, but the absence of such seal
shall not impair the validity of any instrument executed on
behalf of the Trust.
Section 2.10. Principal Transactions. Except for
transactions not permitted by the 1940 Act or rules and
regulations adopted, or orders issued, by the Commission
thereunder, the Trustees may, on behalf of the Trust, buy any
securities from or sell any securities to, or lend any assets of
the Trust or any Series thereof to any Trustee or officer of the
Trust or any firm of which any such Trustee or officer is a
member acting as principal, or have any such dealings with the
Investment Adviser, Distributor or Transfer Agent or with any
Interested Person of such Person; and the Trust or a Series
thereof may employ any such Person, or firm or company in which
such Person is an Interested Person, as broker, legal counsel,
registrar, transfer agent, dividend disbursing agent or custodian
upon customary terms.
Section 2.11. Litigation. The Trustees shall have the
power to engage in and to prosecute, defend, compromise, abandon,
or adjust by arbitration, or otherwise, any actions, suits,
proceedings, disputes, claims, and demands relating to the Trust,
and out of the assets of the Trust or any Series thereof to pay
or to satisfy any debts, claims or expenses incurred in
connection therewith, including those of litigation, and such
power shall include without limitation the power of the Trustees
or any appropriate committee thereof, in the exercise of their or
its good faith business judgment, to dismiss any action, suit,
proceeding, dispute, claim, or demand, derivative or otherwise,
brought by any person, including a Shareholder in its own name or
the name of the Trust, whether or not the Trust or any of the
Trustees may be named individually therein or the subject matter
arises by reason of business for or on behalf of the Trust.
Section 2.12. Number of Trustees. The initial Trustees
shall be the persons signing this Declaration. The number of
Trustees shall be such number as shall be fixed from time to time
by vote of a majority of the Trustees, provided, however, that
the number of Trustees shall in no event be less than one (1).
Section 2.13. Election and Term. Except for the Trustees
named herein or appointed to fill vacancies pursuant to Section
2.15 hereof, the Trustees may succeed themselves and shall be
elected by the Shareholders owning of record a plurality of the
Shares voting at a meeting of Shareholders on a date fixed by the
Trustees. Except in the event of resignations or removals
pursuant to Section 2.14 hereof, each Trustee shall hold office
until such time as less than a majority of the Trustees holding
office has been elected by Shareholders. In such event the
Trustees then in office shall call a Shareholders' meeting for
the election of Trustees. Except for the foregoing
circumstances, the Trustees shall continue to hold office and may
appoint successor Trustees.
Section 2.14. Resignation and Removal. Any Trustee may
resign his trust (without the need for any prior or subsequent
accounting) by an instrument in writing signed by him and
delivered to the other Trustees and such resignation shall be
effective upon such delivery, or at a later date according to the
terms of the instrument. Any of the Trustees may be removed
(provided the aggregate number of Trustees after such removal
shall not be less than one) with cause, by the action of two-
thirds of the remaining Trustees or by action of two-thirds of
the outstanding Shares of the Trust (for purposes of determining
the circumstances and procedures under which any such removal by
the Shareholders may take place, the provisions of Section 16(c)
of the 1940 Act (or any successor provisions) shall be applicable
to the same extent as if the Trust were subject to the provisions
of that Section). Upon the resignation or removal of a Trustee,
or his otherwise ceasing to be a Trustee, he shall execute and
deliver such documents as the remaining Trustees shall require
for the purpose of conveying to the Trust or the remaining
Trustees any Trust Property held in the name of the resigning or
removed Trustee. Upon the incapacity or death of any Trustee,
his legal representative shall execute and deliver on his behalf
such documents as the remaining Trustees shall require as
provided in the preceding sentence.
Section 2.15. Vacancies. The term of office of a Trustee
shall terminate and a vacancy shall occur in the event of his
death, retirement, resignation, removal, bankruptcy, adjudicated
incompetence or other incapacity to perform the duties of the
office of a Trustee. No such vacancy shall operate to annul the
Declaration or to revoke any existing agency created pursuant to
the terms of the Declaration. In the case of an existing
vacancy, including a vacancy existing by reason of an increase in
the number of Trustees, subject to the provisions of Section
16(a) of the 1940 Act, the remaining Trustees shall fill such
vacancy by the appointment of such other person as they in their
discretion shall see fit, made by vote of a majority of the
Trustees then in office. Any such appointment shall not become
effective, however, until the person named in the vote approving
the appointment shall have accepted in writing such appointment
and agreed in writing to be bound by the terms of the
Declaration. An appointment of a Trustee may be made in
anticipation of a vacancy to occur at a later date by reason of
retirement, resignation or increase in the number of Trustees,
provided that such appointment shall not become effective prior
to such retirement, resignation or increase in the number of
Trustees. Whenever a vacancy in the number of Trustees shall
occur, until such vacancy is filled as provided in this Section
2.15, the Trustees in office, regardless of their number, shall
have all the powers granted to the Trustees and shall discharge
all the duties imposed upon the Trustees by the Declaration. The
vote by a majority of the Trustees in office, fixing the number
of Trustees shall be conclusive evidence of the existence of such
vacancy.
Section 2.16. Delegation of Power to Other Trustees. Any
Trustee may, by power of attorney, delegate his power for a
period not exceeding six (6) months at any one time to any other
Trustee or Trustees; provided that in no case shall fewer than
two (2) Trustees personally exercise the powers granted to the
Trustees under this Declaration except as herein otherwise
expressly provided.
ARTICLE III
CONTRACTS
Section 3.1. Distribution Contract. The Trustees may in
their discretion from time to time enter into an exclusive or
non-exclusive distribution contract or contracts providing for
the sale of the Shares to net the Trust or the applicable Series
of the Trust not less than the amount provided for in Section 7.1
of Article VII hereof, whereby the Trustees may either agree to
sell the Shares to the other party to the contract or appoint
such other party as their sales agent for the Shares, and in
either case on such terms and conditions, if any, as may be
prescribed in the By-laws, and such further terms and conditions
as the Trustees may in their discretion determine not
inconsistent with the provisions of this Article III or of the
By-laws; and such contract may also provide for the repurchase of
the Shares by such other party as agent of the Trustees.
Section 3.2. Advisory or Management Contract. The Trustees
may in their discretion from time to time enter into one or more
investment advisory or management contracts or, if the Trustees
establish multiple Series, separate investment advisory or
management contracts with respect to one or more Series whereby
the other party or parties to any such contracts shall undertake
to furnish the Trust or such Series management, investment
advisory, administration, accounting, legal, statistical and
research facilities and services, promotional or marketing
activities, and such other facilities and services, if any, as
the Trustees shall from time to time consider desirable and all
upon such terms and conditions as the Trustees may in their
discretion determine. Notwithstanding any provisions of the
Declaration, the Trustees may authorize the Investment Advisers,
or any of them, under any such contracts (subject to such general
or specific instructions as the Trustees may from time to time
adopt) to effect purchases, sales, loans or exchanges of
portfolio securities and other investments of the Trust on behalf
of the Trustees or may authorize any officer, employee or Trustee
to effect such purchases, sales, loans or exchanges pursuant to
recommendations of such Investment Advisers, or any of them (and
all without further action by the Trustees). Any such purchases,
sales, loans and exchanges shall be deemed to have been
authorized by all of the Trustees. The Trustees may, in their
sole discretion, call a meeting of Shareholders in order to
submit to a vote of Shareholders at such meeting the approval or
continuance of any such investment advisory or management
contract. If the Shareholders of any one or more of the Series
of the Trust should fail to approve any such investment advisory
or management contract, the Investment Adviser may nonetheless
serve as Investment Adviser with respect to any Series whose
Shareholders approve such contract.
Section 3.3. Administration Agreement. The Trustees may in
their discretion from time to time enter into an administration
agreement or, if the Trustees establish multiple Series or
Classes, separate administration agreements with respect to each
Series or Class, whereby the other party to such agreement shall
undertake to manage the business affairs of the Trust or of a
Series or Class thereof and furnish the Trust or a Series or a
Class thereof with office facilities, and shall be responsible
for the ordinary clerical, bookkeeping and recordkeeping services
at such office facilities, and other facilities and services, if
any, and all upon such terms and conditions as the Trustees may
in their discretion determine.
Section 3.4. Service Agreement. The Trustees may in their
discretion from time to time enter into Service Agreements with
respect to one or more Series or Classes thereof whereby the
other parties to such Service Agreements will provide
administration and/or support services pursuant to administration
plans and service plans, and all upon such terms and conditions
as the Trustees in their discretion may determine.
Section 3.5. Transfer Agent. The Trustees may in their
discretion from time to time enter into a transfer agency and
shareholder service contract whereby the other party to such
contract shall undertake to furnish transfer agency and
shareholder services to the Trust. The contract shall have such
terms and conditions as the Trustees may in their discretion
determine not inconsistent with the Declaration. Such services
may be provided by one or more Persons.
Section 3.6. Custodian. The Trustees may appoint or
otherwise engage one or more banks or trust companies, each
having an aggregate capital, surplus and undivided profits (as
shown in its last published report) of at least two million
dollars ($2,000,000) to serve as 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. The Trustees may also authorize the Custodian to employ
one or more sub-custodians, including such foreign banks and
securities depositories as meet the requirements of applicable
provisions of the 1940 Act, and upon such terms and conditions as
may be agreed upon between the Custodian and such sub-custodian,
to hold securities and other assets of the Trust and to perform
the acts and services of the Custodian, subject to applicable
provisions of law and resolutions adopted by the Trustees.
Section 3.7. Affiliations of Trustees or Officers, Etc.
The fact that:
(i) any of the Shareholders, Trustees or officers of
the Trust or any Series thereof is a shareholder, director,
officer, partner, trustee, employee, manager, adviser or
distributor of or for any partnership, corporation, trust,
association or other organization or of or for any parent or
affiliate of any organization, with which a contract of the
character described in Sections 3.1, 3.2, 3.3 or 3.4 above
or for services as Custodian, Transfer Agent or disbursing
agent or for providing accounting, legal and printing
services or for related services may have been or may
hereafter be made, or that any such organization, or any
parent or affiliate thereof, is a Shareholder of or has an
interest in the Trust, or that
(ii) any partnership, corporation, trust, association
or other organization with which a contract of the character
described in Sections 3.1, 3.2, 3.3 or 3.4 above or for
services as Custodian, Transfer Agent or disbursing agent or
for related services may have been or may hereafter be made
also has any one or more of such contracts with one or more
other partnerships, corporations, trusts, associations or
other organizations, or has other business or interests,
shall not affect the validity of any such contract or
disqualify any Shareholder, Trustee or officer of the Trust
from voting upon or executing the same or create any
liability or accountability to the Trust or its
Shareholders.
Section 3.8. Compliance with 1940 Act. Any contract
entered into pursuant to Sections 3.1 or 3.2 shall be consistent
with and subject to the requirements of Section 15 of the 1940
Act (including any amendment thereof or other applicable Act of
Congress hereafter enacted), as modified by any applicable order
or orders of the Commission, with respect to its continuance in
effect, its termination and the method of authorization and
approval of such contract or renewal thereof.
ARTICLE IV
LIMITATIONS OF LIABILITY OF SHAREHOLDERS,
TRUSTEES AND OTHERS
Section 4.1. No Personal Liability of Shareholders,
Trustees, Etc. No Shareholder shall be subject to any personal
liability whatsoever to any Person in connection with Trust
Property or the acts, obligations or affairs of the Trust or any
Series thereof. No Trustee, officer, employee or agent of the
Trust or any Series thereof shall be subject to any personal
liability whatsoever to any Person, other than to the Trust or
its Shareholders, in connection with Trust Property or the
affairs of the Trust, except to the extent arising from bad
faith, willful misfeasance, gross negligence or reckless
disregard of his duties with respect to such Person; and all such
Persons shall look solely to the Trust Property, or to the
Property of one or more specific Series of the Trust if the claim
arises from the conduct of such Trustee, officer, employee or
agent with respect to only such Series, for satisfaction of
claims of any nature arising in connection with the affairs of
the Trust. If any Shareholder, Trustee, officer, employee, or
agent, as such, of the Trust or any Series thereof, is made a
party to any suit or proceeding to enforce any such liability of
the Trust or any Series thereof, he shall not, on account
thereof, be held to any personal liability. The Trust shall
indemnify and hold each Shareholder harmless from and against all
claims and liabilities, to which such Shareholder may become
subject by reason of his being or having been a Shareholder, and
shall reimburse such Shareholder or former Shareholder (or his or
her heirs, executors, administrators or other legal
representatives or in the case of a corporation or other entity,
its corporate or other general successor) out of the Trust
Property for all legal and other expenses reasonably incurred by
him in connection with any such claim or liability. The
indemnification and reimbursement required by the preceding
sentence shall be made only out of assets of the one or more
Series whose Shares were held by said Shareholder at the time the
act or event occurred which gave rise to the claim against or
liability of said Shareholder. The rights accruing to a
Shareholder under this Section 4.1 shall not impair any other
right to which such Shareholder may be lawfully entitled, nor
shall anything herein contained restrict the right of the Trust
or any Series thereof to indemnify or reimburse a Shareholder in
any appropriate situation even though not specifically provided
herein.
Section 4.2. Non-Liability of Trustees, Etc. No Trustee,
officer, employee or agent of the Trust or any Series thereof
shall be liable to the Trust, its Shareholders, or to any
Shareholder, Trustee, officer, employee, or agent thereof for any
action or failure to act (including without limitation the
failure to compel in any way any former or acting Trustee to
redress any breach of trust) except for his own bad faith,
willful misfeasance, gross negligence or reckless disregard of
the duties involved in the conduct of his office.
Section 4.3. Mandatory Indemnification. (a) Subject to the
exceptions and limitations contained in paragraph (b) below:
(i) every person who is, or has been, a Trustee,
officer, employee or agent of the Trust (including any
individual who serves at its request as director, officer,
partner, trustee or the like of another organization in
which it has any interest as a shareholder, creditor or
otherwise) shall be indemnified by the Trust, or by one or
more Series thereof if the claim arises from his or her
conduct with respect to only such Series, to the fullest
extent permitted by law against all liability and against
all expenses reasonably incurred or paid by him in
connection with any claim, action, suit or proceeding in
which he becomes involved as a party or otherwise by virtue
of his being or having been a Trustee or officer and against
amounts paid or incurred by him in the settlement thereof;
(ii) the words "claim," "action," "suit," or
"proceeding" shall apply to all claims, actions, suits or
proceedings (civil, criminal, or other, including appeals),
actual or threatened; and the words "liability" and
"expenses" shall include, without limitation, attorneys'
fees, costs, judgments, amounts paid in settlement, fines,
penalties and other liabilities.
(b) No indemnification shall be provided hereunder to a
Trustee or officer:
(i) against any liability to the Trust, a Series
thereof or the Shareholders by reason of willful
misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of his
office;
(ii) with respect to any matter as to which he shall
have been finally adjudicated not to have acted in good
faith in the reasonable belief that his action was in the
best interest of the Trust or a Series thereof;
(iii) in the event of a settlement or other disposition
not involving a final adjudication as provided in paragraph
(b)(ii) resulting in a payment by a Trustee or officer,
unless there has been a determination that such Trustee or
officer did not engage in willful misfeasance, bad faith,
gross negligence or reckless disregard of the duties
involved in the conduct of his office:
(A) by the court or other body approving the
settlement or other disposition;
(B) based upon a review of readily available
facts (as opposed to a full trial-type inquiry) by
(x) vote of a majority of the Non-interested Trustees
acting on the matter (provided that a majority of the
Non-interested Trustees then in office act on the
matter) or (y) written opinion of independent legal
counsel; or
(C) by a vote of a majority of the Shares
outstanding and entitled to vote (excluding Shares
owned of record or beneficially by such individual).
(c) 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
or officer may now or hereafter be entitled, shall continue as to
a person who has ceased to be such Trustee or officer and shall
inure to the benefit of the heirs, executors, administrators and
assigns of such a person. Nothing contained herein shall affect
any rights to indemnification to which personnel of the Trust or
any Series thereof other than Trustees and officers may be
entitled by contract or otherwise under law.
(d) Expenses of preparation and presentation of a defense
to any claim, action, suit or proceeding of the character
described in paragraph (a) of this Section 4.3 may be advanced by
the Trust or a Series thereof prior to final disposition thereof
upon receipt of an undertaking by or on behalf of the recipient
to repay such amount if it is ultimately determined that he is
not entitled to indemnification under this Section 4.3, provided
that either:
(i) such undertaking is secured by a surety bond or
some other appropriate security provided by the recipient,
or the Trust or Series thereof shall be insured against
losses arising out of any such advances; or
(ii) a majority of the Non-interested Trustees acting
on the matter (provided that a majority of the Non-
interested Trustees act on the matter) or an independent
legal counsel in a written opinion shall determine, based
upon a review of readily available facts (as opposed to a
full trial-type inquiry), that there is reason to believe
that the recipient ultimately will be found entitled to
indemnification.
As used in this Section 4.3, a "Non-interested Trustee" is
one who (i) is not an "Interested Person" of the Trust (including
anyone who has been exempted from being an "Interested Person" by
any rule, regulation or order of the Commission), and (ii) is not
involved in the claim, action, suit or proceeding.
Section 4.4. No Bond Required of Trustees. No Trustee
shall be obligated to give any bond or other security for the
performance of any of his duties hereunder.
Section 4.5. No Duty of Investigation; Notice in Trust
Instruments, Etc. No purchaser, lender, transfer agent or other
Person dealing with the Trustees or any officer, employee or
agent of the Trust or a Series thereof shall be bound to make any
inquiry concerning the validity of any transaction purporting to
be made by the Trustees or by said officer, employee or agent or
be liable for the application of money or property paid, loaned,
or delivered to or on the order of the Trustees or of said
officer, employee or agent. Every obligation, contract,
instrument, certificate, Share, other security of the Trust or a
Series thereof or undertaking, and every other act or thing
whatsoever executed in connection with the Trust shall be
conclusively presumed to have been executed or done by the
executors thereof only in their capacity as Trustees under this
Declaration or in their capacity as officers, employees or agents
of the Trust or a Series thereof. Every written obligation,
contract, instrument, certificate, Share, other security of the
Trust or a Series thereof or undertaking made or issued by the
Trustees may recite that the same is executed or made by them not
individually, but as Trustees under the Declaration, and that the
obligations of the Trust or a Series thereof under any such
instrument are not binding upon any of the Trustees or
Shareholders individually, but bind only the Trust Property or
the Trust Property of the applicable Series, and may contain any
further recital which they may deem appropriate, but the omission
of such recital shall not operate to bind the Trustees
individually. The Trustees shall at all times maintain insurance
for the protection of the Trust Property or the Trust Property of
the applicable Series, its Shareholders, Trustees, officers,
employees and agents in such amount as the Trustees shall deem
adequate to cover possible tort liability, and such other
insurance as the Trustees in their sole judgment shall deem
advisable.
Section 4.6. Reliance on Experts, Etc. Each Trustee,
officer or employee of the Trust or a Series thereof shall, in
the performance of his duties, be fully and completely justified
and protected with regard to any act or any failure to act
resulting from reliance in good faith upon the books of account
or other records of the Trust or a Series thereof, upon an
opinion of counsel, or upon reports made to the Trust or a Series
thereof by any of its officers or employees or by the Investment
Adviser, the Administrator, the Distributor, Transfer Agent,
selected dealers, accountants, appraisers or other experts or
consultants selected with reasonable care by the Trustees,
officers or employees of the Trust, regardless of whether such
counsel or expert may also be a Trustee.
ARTICLE V
SHARES OF BENEFICIAL INTEREST
Section 5.1. Beneficial Interest. The interest of the
beneficiaries hereunder shall be divided into transferable Shares
of beneficial interest without par value. The number of such
Shares of beneficial interest authorized hereunder is unlimited.
The Trustees shall have the exclusive authority without the
requirement of Shareholder approval to establish and designate
one or more Series of shares and one or more Classes thereof as
the Trustees deem necessary or desirable. Each Share of any
Series shall represent an equal proportionate Share in the assets
of that Series with each other Share in that Series. Subject to
the provisions of Section 5.11 hereof, the Trustees may also
authorize the creation of additional Series of Shares (the
proceeds of which may be invested in separate, independently
managed portfolios) and additional Classes of Shares within any
Series. All Shares issued hereunder including, without
limitation, Shares issued in connection with a dividend in Shares
or a split in Shares, shall be fully paid and nonassessable.
Section 5.2. Rights of Shareholders. The ownership of the
Trust Property of every description and the right to conduct any
business hereinbefore described are vested exclusively in the
Trustees, and the Shareholders shall have no interest therein
other than the beneficial interest conferred by their Shares, and
they shall have no right to call for any partition or division of
any property, profits, rights or interests of the Trust nor can
they be called upon to share or assume any losses of the Trust or
suffer an assessment of any kind by virtue of their ownership of
Shares. The Shares shall be personal property giving only the
rights specifically set forth in this Declaration. The Shares
shall not entitle the holder to preference, preemptive,
appraisal, conversion or exchange rights, except as the Trustees
may determine with respect to any Series or Class of Shares.
Section 5.3. Trust Only. It is the intention of the
Trustees to create only the relationship of Trustee and
beneficiary between the Trustees and each Shareholder from time
to time. It is not the intention of the Trustees to create a
general partnership, limited partnership, joint stock
association, corporation, bailment or any form of legal
relationship other than a trust. Nothing in this Declaration of
Trust shall be construed to make the Shareholders, either by
themselves or with the Trustees, partners or members of a joint
stock association.
Section 5.4. Issuance of Shares. The Trustees in their
discretion may, from time to time without a vote of the
Shareholders, issue Shares, in addition to the then issued and
outstanding Shares and Shares held in the treasury, to such party
or parties and for such amount and type of consideration,
including cash or property, at such time or times and on such
terms as the Trustees may deem best, except that only Shares
previously contracted to be sold may be issued during any period
when the right of redemption is suspended pursuant to Section 6.9
hereof, and may in such manner acquire other assets (including
the acquisition of assets subject to, and in connection with the
assumption of, liabilities) and businesses. In connection with
any issuance of Shares, the Trustees may issue fractional Shares
and Shares held in the treasury. The Trustees may from time to
time divide or combine the Shares of the Trust or, if the Shares
be divided into Series or Classes, of any Series or any Class
thereof of the Trust, into a greater or lesser number without
thereby changing the proportionate beneficial interests in the
Trust or in the Trust Property allocated or belonging to such
Series or Class. Contributions to the Trust or Series thereof
may be accepted for, and Shares shall be redeemed as, whole
Shares and/or 1/1000ths of a Share or integral multiples thereof.
Section 5.5. Register of Shares. A register shall be kept
at the principal office of the Trust or an office of the Transfer
Agent which shall contain the names and addresses of the
Shareholders and the number of Shares held by them respectively
and a record of all transfers thereof. Such register shall be
conclusive as to who are the holders of the Shares and who shall
be entitled to receive dividends or distributions or otherwise to
exercise or enjoy the rights of Shareholders. No Shareholder
shall be entitled to receive payment of any dividend or
distribution, nor to have notice given to him as provided herein
or in the By-laws, until he has given his address to the Transfer
Agent or such other officer or agent of the Trustees as shall
keep the said register for entry thereon. It is not contemplated
that certificates will be issued for the Shares; however, the
Trustees, in their discretion, may authorize the issuance of
share certificates and promulgate appropriate rules and
regulations as to their use.
Section 5.6. Transfer of Shares. Shares shall be
transferable on the records of the Trust only by the record
holder thereof or by his agent thereunto duly authorized in
writing, upon delivery to the Trustees or the Transfer Agent of a
duly executed instrument of transfer, together with such evidence
of the genuineness of each such execution and authorization and
of other matters as may reasonably be required. Upon such
delivery the transfer shall be recorded on the register of the
Trust. Until such record is made, the Shareholder of record
shall be deemed to be the holder of such Shares for all purposes
hereunder and neither the Trustees nor any transfer agent or
registrar nor any officer, employee or agent of the Trust shall
be affected by any notice of the proposed transfer.
Any person becoming entitled to any Shares in consequence of
the death, bankruptcy, or incompetence of any Shareholder, or
otherwise by operation of law, shall be recorded on the register
of Shares as the holder of such Shares upon production of the
proper evidence thereof to the Trustees or the Transfer Agent,
but until such record is made, the Shareholder of record shall be
deemed to be the holder of such Shares for all purposes hereunder
and neither the Trustees nor any Transfer Agent or registrar nor
any officer or agent of the Trust shall be affected by any notice
of such death, bankruptcy or incompetence, or other operation of
law.
Section 5.7. Notices. Any and all notices to which any
Shareholder may be entitled and any and all communications shall
be deemed duly served or given if mailed, postage prepaid,
addressed to any Shareholder of record at his last known address
as recorded on the register of the Trust.
Section 5.8. Treasury Shares. Shares held in the treasury
shall, until resold pursuant to Section 5.4, not confer any
voting rights on the Trustees, nor shall such Shares be entitled
to any dividends or other distributions declared with respect to
the Shares.
Section 5.9. Voting Powers. The Shareholders shall have
power to vote only (i) for the election of Trustees as provided
in Section 2.13; (ii) with respect to any investment advisory
contract entered into pursuant to Section 3.2; (iii) with respect
to termination of the Trust or a Series or Class thereof as
provided in Section 8.2; (iv) with respect to any amendment of
this Declaration to the limited extent and as provided in Section
8.3; (v) with respect to a merger, consolidation or sale of
assets as provided in Section 8.4; (vi) with respect to
incorporation of the Trust to the extent and as provided in
Section 8.5; (vii) to the same extent as the stockholders of a
Massachusetts business corporation as to whether or not a court
action, proceeding or claim should or should not be brought or
maintained derivatively or as a class action on behalf of the
Trust or a Series thereof or the Shareholders of either; (viii)
with respect to any plan adopted pursuant to Rule 12b-1 (or any
successor rule) under the 1940 Act, and related matters; and (ix)
with respect to such additional matters relating to the Trust as
may be required by this Declaration, the By-laws or any
registration of the Trust as an investment company under the 1940
Act with the Commission (or any successor agency) or as the
Trustees may consider necessary or desirable. As determined by
the Trustees without the vote or consent of shareholders, on any
matter submitted to a vote of Shareholders either (i) 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 or (ii) each dollar of net
asset value (number of Shares owned times net asset value per
share of such Series or Class, as applicable) shall be entitled
to one vote on any matter on which such Shares are entitled to
vote and each fractional dollar amount shall be entitled to a
proportionate fractional vote. The Trustees may, in conjunction
with the establishment of any further Series or any Classes of
Shares, establish conditions under which the several Series or
Classes of Shares shall have separate voting rights or no voting
rights. 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 by law,
this Declaration or the By-laws to be taken by Shareholders. The
By-laws may include further provisions for Shareholders' votes
and meetings and related matters.
Section 5.10. Meetings of Shareholders. No annual or
regular meetings of Shareholders are required. Special meetings
of the Shareholders, including meetings involving only the
holders of Shares of one or more but less than all Series or
Classes thereof, may be called at any time by the Chairman of the
Board, President, or any Vice-President of the Trust, and shall
be called by the President or the Secretary at the request, in
writing or by resolution, of a majority of the Trustees, or at
the written request of the holder or holders of ten percent (10%)
or more of the total number of Outstanding Shares of the Trust
entitled to vote at such meeting. Meetings of the Shareholders
of any Series shall be called by the President or the Secretary
at the written request of the holder or holders of ten percent
(10%) or more of the total number of Outstanding Shares of such
Series of the Trust entitled to vote at such meeting. Any such
request shall state the purpose of the proposed meeting.
Section 5.11. Series or Class Designation. (a) Without
limiting the authority of the Trustees set forth in Section 5.1
to establish and designate any further Series or Classes, the
Trustees hereby establish the following Series, each of which
consists of Class A Shares, Class B Shares, and Class C Shares:
John Hancock Strategic Income Fund (the "Existing Series").
(b) The Shares of the Existing Series and Class thereof
herein established and designated and any Shares of any further
Series and Classes thereof that may from time to time be
established and designated by the Trustees shall be established
and designated, and the variations in the relative rights and
preferences as between the different Series shall be fixed and
determined, by the Trustees (unless the Trustees otherwise
determine with respect to further Series or Classes at the time
of establishing and designating the same); provided, that all
Shares shall be identical except that there may be variations so
fixed and determined between different Series or Classes thereof
as to investment objective, policies and restrictions, purchase
price, payment obligations, distribution expenses, right of
redemption, special and relative rights as to dividends and on
liquidation, conversion rights, exchange rights, and conditions
under which the several Series or Classes shall have separate
voting rights, all of which are subject to the limitations set
forth below. All references to Shares in this Declaration shall
be deemed to be Shares of any or all Series or Classes as the
context may require.
(c) As to any Existing Series and Classes herein
established and designated and any further division of Shares of
the Trust into additional Series or Classes, the following
provisions shall be applicable:
(i) The number of authorized Shares and the number of
Shares of each Series or Class thereof that may be issued shall
be unlimited. The Trustees may classify or reclassify any
unissued Shares or any Shares previously issued and reacquired of
any Series or Class into one or more Series or one or more
Classes that may be established and designated from time to time.
The Trustees may hold as treasury shares (of the same or some
other Series or Class), reissue for such consideration and on
such terms as they may determine, or cancel any Shares of any
Series or Class reacquired by the Trust at their discretion from
time to time.
(ii) All consideration received by the Trust for the
issue or sale of Shares of a particular Series or Class, together
with all assets in which such consideration is invested or
reinvested, all income, earnings, profits, and proceeds thereof,
including any proceeds derived from the sale, exchange or
liquidation of such assets, and any funds or payments derived
from any reinvestment of such proceeds in whatever form the same
may be, shall irrevocably belong to that Series for all purposes,
subject only to the rights of creditors of such Series and except
as may otherwise be required by applicable tax laws, and shall be
so recorded upon the books of account of the Trust. In the event
that there are any assets, income, earnings, profits, and
proceeds thereof, funds, or payments which are not readily
identifiable as belonging to any particular Series, the Trustees
shall allocate them among any one or more of the Series
established and designated from time to time in such manner and
on such basis as they, in their sole discretion, deem fair and
equitable. Each such allocation by the Trustees shall be
conclusive and binding upon the Shareholders of all Series for
all purposes. No holder of Shares of any Series shall have any
claim on or right to any assets allocated or belonging to any
other Series.
(iii) The assets belonging to each particular Series
shall be charged with the liabilities of the Trust in respect of
that Series or the appropriate Class or Classes thereof and all
expenses, costs, charges and reserves attributable to that Series
or Class or Classes thereof, and any general liabilities,
expenses, costs, charges or reserves of the Trust which are not
readily identifiable as belonging to any particular Series shall
be allocated and charged by the Trustees to and among any one or
more of the Series established and designated from time to time
in such manner and on such basis as the Trustees in their sole
discretion deem fair and equitable. Each allocation of
liabilities, expenses, costs, charges and reserves by the
Trustees shall be conclusive and binding upon the Shareholders of
all Series and Classes for all purposes. The Trustees shall have
full discretion, to the extent not inconsistent with the 1940
Act, to determine which items are capital; and each such
determination and allocation shall be conclusive and binding upon
the Shareholders. The assets of a particular Series of the Trust
shall under no circumstances be charged with liabilities
attributable to any other Series or Class thereof of the Trust.
All persons extending credit to, or contracting with or having
any claim against a particular Series or Class of the Trust shall
look only to the assets of that particular Series for payment of
such credit, contract or claim.
(iv) The power of the Trustees to pay dividends and
make distributions shall be governed by Section 7.2 of this
Declaration. With respect to any Series or Class, dividends and
distributions on Shares of a particular Series or Class may be
paid with such frequency as the Trustees may determine, which may
be daily or otherwise, pursuant to a standing resolution or
resolutions adopted only once or with such frequency as the
Trustees may determine, to the holders of Shares of that Series
or Class, from such of the income and capital gains, accrued or
realized, from the assets belonging to that Series, as the
Trustees may determine, after providing for actual and accrued
liabilities belonging to that Series or Class. All dividends and
distributions on Shares of a particular Series or Class shall be
distributed pro rata to the Shareholders of that Series or Class
in proportion to the number of Shares of that Series or Class
held by such Shareholders at the time of record established for
the payment of such dividends or distribution.
(v) Each Share of a Series of the Trust shall
represent a beneficial interest in the net assets of such Series.
Each holder of Shares of a Series or Class thereof shall be
entitled to receive his pro rata share of distributions of income
and capital gains made with respect to such Series or Class net
of expenses. Upon redemption of his Shares or indemnification
for liabilities incurred by reason of his being or having been a
Shareholder of a Series or Class, such Shareholder shall be paid
solely out of the funds and property of such Series of the Trust.
Upon liquidation or termination of a Series or Class thereof of
the Trust, Shareholders of such Series or Class thereof shall be
entitled to receive a pro rata share of the net assets of such
Series. A Shareholder of a particular Series of the Trust shall
not be entitled to participate in a derivative or class action on
behalf of any other Series or the Shareholders of any other
Series of the Trust.
(vi) On each matter submitted to a vote of
Shareholders, all Shares of all Series and Classes shall vote as
a single class; provided, however, that (1) as to any matter with
respect to which a separate vote of any Series or Class is
required by the 1940 Act or is required by attributes applicable
to any Series or Class or is required by any Rule 12b-1 plan,
such requirements as to a separate vote by that Series or Class
shall apply, (2) to the extent that a matter referred to in
clause (1) above, affects more than one Class or Series and the
interests of each such Class or Series in the matter are
identical, then, subject to clause (3) below, the Shares of all
such affected Classes or Series shall vote as a single Class; (3)
as to any matter which does not affect the interests of a
particular Series or Class, only the holders of Shares of the one
or more affected Series or Classes shall be entitled to vote; and
(4) the provisions of the following sentence shall apply. On any
matter that pertains to any particular Class of a particular
Series or to any Class expenses with respect to any Series which
matter may be submitted to a vote of Shareholders, only Shares of
the affected Class or that Series, as the case may be, shall be
entitled to vote except that: (i) to the extent said matter
affects Shares of another Class or Series, such other Shares
shall also be entitled to vote, and in such cases Shares of the
affected Class, as the case may be, of such Series shall be voted
in the aggregate together with such other Shares; and (ii) to the
extent that said matter does not affect Shares of a particular
Class of such Series, said Shares shall not be entitled to vote
(except where otherwise required by law or permitted by the
Trustees acting in their sole discretion) even though the matter
is submitted to a vote of the Shareholders of any other Class or
Series.
(vii) Except as otherwise provided in this Article V,
the Trustees shall have the power to determine the designations,
preferences, privileges, payment obligations, limitations and
rights, including voting and dividend rights, of each Class and
Series of Shares. Subject to compliance with the requirements of
the 1940 Act, the Trustees shall have the authority to provide
that the holders of Shares of any Series or Class shall have the
right to convert or exchange said Shares into Shares of one or
more Series or Classes of Shares in accordance with such
requirements, conditions and procedures as may be established by
the Trustees.
(viii) The establishment and designation of any Series or
Classes of Shares shall be effective upon the execution by a
majority of the then Trustees of an instrument setting forth such
establishment and designation and the relative rights and
preferences of such Series or Classes, or as otherwise provided
in such instrument. At any time that there are no Shares
outstanding of any particular Series or Class previously
established and designated, the Trustees may by an instrument
executed by a majority of their number abolish that Series or
Class and the establishment and designation thereof. Each
instrument referred to in this section shall have the status of
an amendment to this Declaration.
Section 5.12. Assent to Declaration of Trust. Every
Shareholder, by virtue of having become a Shareholder, shall be
held to have expressly assented and agreed to the terms hereof
and to have become a party hereto.
ARTICLE VI
REDEMPTION AND REPURCHASE OF SHARES
Section 6.1. Redemption of Shares. (a) All Shares of the
Trust shall be redeemable, at the redemption price determined in
the manner set out in this Declaration. Redeemed or repurchased
Shares may be resold by the Trust. The Trust may require any
Shareholder to pay a sales charge to the Trust, the underwriter,
or any other person designated by the Trustees upon redemption or
repurchase of Shares in such amount and upon such conditions as
shall be determined from time to time by the Trustees.
(b) The Trust shall redeem the Shares of the Trust or any
Series or Class thereof at the price determined as hereinafter
set forth, upon the appropriately verified written application of
the record holder thereof (or upon such other form of request as
the Trustees may determine) at such office or agency as may be
designated from time to time for that purpose by the Trustees.
The Trustees may from time to time specify additional conditions,
not inconsistent with the 1940 Act, regarding the redemption of
Shares in the Trust's then effective Prospectus.
Section 6.2. Price. Shares shall be redeemed at a price
based on their net asset value determined as set forth in Section
7.1 hereof as of such time as the Trustees shall have theretofore
prescribed by resolution. In the absence of such resolution, the
redemption price of Shares deposited shall be based on the net
asset value of such Shares next determined as set forth in
Section 7.1 hereof after receipt of such application. The amount
of any contingent deferred sales charge or redemption fee payable
upon redemption of Shares may be deducted from the proceeds of
such redemption.
Section 6.3. Payment. Payment of the redemption price of
Shares of the Trust or any Series or Class thereof shall be made
in cash or in property to the Shareholder at such time and in the
manner, not inconsistent with the 1940 Act or other applicable
laws, as may be specified from time to time in the Trust's then
effective Prospectus(es), subject to the provisions of Section
6.4 hereof. Notwithstanding the foregoing, the Trustees may
withhold from such redemption proceeds any amount arising (i)
from a liability of the redeeming Shareholder to the Trust or
(ii) in connection with any Federal or state tax withholding
requirements.
Section 6.4. Effect of Suspension of Determination of Net
Asset Value. If, pursuant to Section 6.9 hereof, the Trustees
shall declare a suspension of the determination of net asset
value with respect to Shares of the Trust or of any Series or
Class thereof, the rights of Shareholders (including those who
shall have applied for redemption pursuant to Section 6.1 hereof
but who shall not yet have received payment) to have Shares
redeemed and paid for by the Trust or a Series or Class thereof
shall be suspended until the termination of such suspension is
declared. Any record holder who shall have his redemption right
so suspended may, during the period of such suspension, by
appropriate written notice of revocation at the office or agency
where application was made, revoke any application for redemption
not honored and withdraw any Share certificates on deposit. The
redemption price of Shares for which redemption applications have
not been revoked shall be based on the net asset value of such
Shares next determined as set forth in Section 7.1 after the
termination of such suspension, and payment shall be made within
seven (7) days after the date upon which the application was made
plus the period after such application during which the
determination of net asset value was suspended.
Section 6.5. Repurchase by Agreement. The Trust may
repurchase Shares directly, or through the Distributor or another
agent designated for the purpose, by agreement with the owner
thereof at a price not exceeding the net asset value per share
determined as of the time when the purchase or contract of
purchase is made or the net asset value as of any time which may
be later determined pursuant to Section 7.1 hereof, provided
payment is not made for the Shares prior to the time as of which
such net asset value is determined.
Section 6.6. Redemption of Shareholder's Interest. The
Trustees, in their sole discretion, may cause the Trust to redeem
all of the Shares of one or more Series or Class thereof held by
any Shareholder if the value of such Shares held by such
Shareholder is less than the minimum amount established from time
to time by the Trustees.
Section 6.7. Redemption of Shares in Order to Qualify as
Regulated Investment Company; Disclosure of Holding. (a) If the
Trustees shall, at any time and in good faith, be of the opinion
that direct or indirect ownership of Shares or other securities
of the Trust has or may become concentrated in any Person to an
extent which would disqualify the Trust or any Series of the
Trust as a regulated investment company under the Internal
Revenue Code of 1986, then the Trustees shall have the power by
lot or other means deemed equitable by them (i) to call for
redemption by any such Person a number, or principal amount, of
Shares or other securities of the Trust or any Series of the
Trust sufficient to maintain or bring the direct or indirect
ownership of Shares or other securities of the Trust or any
Series of the Trust into conformity with the requirements for
such qualification and (ii) to refuse to transfer or issue Shares
or other securities of the Trust or any Series of the Trust to
any Person whose acquisition of the Shares or other securities of
the Trust or any Series of the Trust in question would result in
such disqualification. The redemption shall be effected at the
redemption price and in the manner provided in Section 6.1.
(b) The holders of Shares or other securities of the Trust
or any Series of the Trust shall upon demand disclose to the
Trustees in writing such information with respect to direct and
indirect ownership of Shares or other securities of the Trust or
any Series of the Trust as the Trustees deem necessary to comply
with the provisions of the Internal Revenue Code of 1986, as
amended, or to comply with the requirements of any other taxing
authority.
Section 6.8. Reductions in Number of Outstanding Shares
Pursuant to Net Asset Value Formula. The Trust may also reduce
the number of outstanding Shares of the Trust or of any Series of
the Trust pursuant to the provisions of Section 7.3.
Section 6.9. Suspension of Right of Redemption. The Trust
may declare a suspension of the right of redemption or postpone
the date of payment or redemption for the whole or any part of
any period (i) during which the New York Stock Exchange is closed
other than customary weekend and holiday closings, (ii) during
which trading on the New York Stock Exchange is restricted, (iii)
during which an emergency exists as a result of which disposal by
the Trust or a Series thereof of securities owned by it is not
reasonably practicable or it is not reasonably practicable for
the Trust or a Series thereof fairly to determine the value of
its net assets, or (iv) during any other period when the
Commission may for the protection of Shareholders of the Trust by
order permit suspension of the right of redemption or
postponement of the date of payment or redemption; provided that
applicable rules and regulations of the Commission shall govern
as to whether the conditions prescribed in clauses (ii), (iii),
or (iv) exist. Such suspension shall take effect at such time as
the Trust shall specify but not later than the close of business
on the business day next following the declaration of suspension,
and thereafter there shall be no right of redemption or payment
on redemption until the Trust shall declare the suspension at an
end, except that the suspension shall terminate in any event on
the first day on which said stock exchange shall have reopened or
the period specified in (ii) or (iii) shall have expired (as to
which in the absence of an official ruling by the Commission, the
determination of the Trust shall be conclusive). In the case of
a suspension of the right of redemption, a Shareholder may either
withdraw his request for redemption or receive payment based on
the net asset value existing after the termination of the
suspension.
ARTICLE VII
DETERMINATION OF NET ASSET VALUE,
NET INCOME AND DISTRIBUTIONS
Section 7.1. Net Asset Value. The net asset value of each
outstanding Share of the Trust or of each Series or Class thereof
shall be determined on such days and at such time or times as the
Trustees may determine. The value of the assets of the Trust or
any Series thereof may be determined (i) by a pricing service
which utilizes electronic pricing techniques based on general
institutional trading, (ii) by appraisal of the securities owned
by the Trust or any Series of the Trust, (iii) in certain cases,
at amortized cost, or (iv) by such other method as shall be
deemed to reflect the fair value thereof, determined in good
faith by or under the direction of the Trustees. From the total
value of said assets, there shall be deducted all indebtedness,
interest, taxes, payable or accrued, including estimated taxes on
unrealized book profits, expenses and management charges accrued
to the appraisal date, net income determined and declared as a
distribution and all other items in the nature of liabilities
which shall be deemed appropriate, as incurred by or allocated to
the Trust or any Series or Class of the Trust. The resulting
amount which shall represent the total net assets of the Trust or
Series or Class thereof shall be divided by the number of Shares
of the Trust or Series or Class thereof outstanding at the time
and the quotient so obtained shall be deemed to be the net asset
value of the Shares of the Trust or Series or Class thereof. The
net asset value of the Shares shall be determined at least once
on each business day, as of the close of regular trading on the
New York Stock Exchange or as of such other time or times as the
Trustees shall determine. The power and duty to make the daily
calculations may be delegated by the Trustees to the Investment
Adviser, the Administrator, the Custodian, the Transfer Agent or
such other Person as the Trustees by resolution may determine.
The Trustees may suspend the daily determination of net asset
value to the extent permitted by the 1940 Act. It shall not be a
violation of any provision of this Declaration if Shares are
sold, redeemed or repurchased by the Trust at a price other than
one based on net asset value if the net asset value is affected
by one or more errors inadvertently made in the pricing of
portfolio securities or in accruing income, expenses or
liabilities.
Section 7.2. Distributions to Shareholders. (a) The
Trustees shall from time to time distribute ratably among the
Shareholders of the Trust or of a Series or Class thereof such
proportion of the net profits, surplus (including paid-in
surplus), capital, or assets of the Trust or such Series held by
the Trustees as they may deem proper. Such distributions may be
made in cash or property (including without limitation any type
of obligations of the Trust or Series or Class or any assets
thereof), and the Trustees may distribute ratably among the
Shareholders of the Trust or Series or Class thereof additional
Shares of the Trust or Series or Class thereof issuable hereunder
in such manner, at such times, and on such terms as the Trustees
may deem proper. Such distributions may be among the
Shareholders of the Trust or Series or Class thereof at the time
of declaring a distribution or among the Shareholders of the
Trust or Series or Class thereof at such other date or time or
dates or times as the Trustees shall determine. The Trustees may
in their discretion determine that, solely for the purposes of
such distributions, Outstanding Shares shall exclude Shares for
which orders have been placed subsequent to a specified time on
the date the distribution is declared or on the next preceding
day if the distribution is declared as of a day on which Boston
banks are not open for business, all as described in the then
effective Prospectus under the Securities Act of 1933. The
Trustees may always retain from the net profits such amount as
they may deem necessary to pay the debts or expenses of the Trust
or a Series or Class thereof or to meet obligations of the Trust
or a Series or Class thereof, or as they may deem desirable to
use in the conduct of its affairs or to retain for future
requirements or extensions of the business. The Trustees may
adopt and offer to Shareholders such dividend reinvestment plans,
cash dividend payout plans or related plans as the Trustees shall
deem appropriate. The Trustees may in their discretion determine
that an account administration fee or other similar charge may be
deducted directly from the income and other distributions paid on
Shares to a Shareholder's account in each Series or Class.
(b) Inasmuch as the computation of net income and gains for
Federal income tax purposes may vary from the computation thereof
on the books, the above provisions shall be interpreted to give
the Trustees the power in their discretion to distribute for any
fiscal year as ordinary dividends and as capital gains
distributions, respectively, additional amounts sufficient to
enable the Trust or a Series or Class thereof to avoid or reduce
liability for taxes.
Section 7.3. Determination of Net Income; Constant Net
Asset Value; Reduction of Outstanding Shares. Subject to Section
5.11 hereof, the net income of the Series and Classes thereof of
the Trust shall be determined in such manner as the Trustees
shall provide by resolution. Expenses of the Trust or of a
Series or Class thereof, including the advisory or management
fee, shall be accrued each day. Each Class shall bear only
expenses relating to its Shares and an allocable share of Series
expenses in accordance with such policies as may be established
by the Trustees from time to time and as are not inconsistent
with the provisions of this Declaration or of any applicable
document filed by the Trust with the Commission or of the
Internal Revenue Code of 1986, as amended. Such net income may
be determined by or under the direction of the Trustees as of the
close of regular trading on the New York Stock Exchange on each
day on which such market is open or as of such other time or
times as the Trustees shall determine, and, except as provided
herein, all the net income of any Series or Class, as so
determined, may be declared as a dividend on the Outstanding
Shares of such Series or Class. If, for any reason, the net
income of any Series or Class determined at any time is a
negative amount, or for any other reason, the Trustees shall have
the power with respect to such Series or Class (i) to offset each
Shareholder's pro rata share of such negative amount from the
accrued dividend account of such Shareholder, or (ii) to reduce
the number of Outstanding Shares of such Series or Class by
reducing the number of Shares in the account of such Shareholder
by that number of full and fractional Shares which represents the
amount of such excess negative net income, or (iii) to cause to
be recorded on the books of the Trust an asset account in the
amount of such negative net income, which account may be reduced
by the amount, provided that the same shall thereupon become the
property of the Trust with respect to such Series or Class and
shall not be paid to any Shareholder, of dividends declared
thereafter upon the Outstanding Shares of such Series or Class on
the day such negative net income is experienced, until such asset
account is reduced to zero. The Trustees shall have full
discretion to determine whether any cash or property received
shall be treated as income or as principal and whether any item
of expense shall be charged to the income or the principal
account, and their determination made in good faith shall be
conclusive upon the Shareholders. In the case of stock dividends
received, the Trustees shall have full discretion to determine,
in the light of the particular circumstances, how much if any of
the value thereof shall be treated as income, the balance, if
any, to be treated as principal.
Section 7.4. Power to Modify Foregoing Procedures.
Notwithstanding any of the foregoing provisions of this Article
VII, but subject to Section 5.11 hereof, the Trustees may
prescribe, in their absolute discretion, such other bases and
times for determining the per Share net asset value of the Shares
of the Trust or a Series or Class thereof or net income of the
Trust or a Series or Class thereof, or the declaration and
payment of dividends and distributions as they may deem necessary
or desirable. Without limiting the generality of the foregoing,
the Trustees may establish several Series or Classes of Shares in
accordance with Section 5.11, and declare dividends thereon in
accordance with Section 5.11(d)(iv).
ARTICLE VIII
DURATION; TERMINATION OF TRUST OR A SERIES OR CLASS;
AMENDMENT; MERGERS, ETC.
Section 8.1. Duration. The Trust shall continue without
limitation of time but subject to the provisions of this Article
VIII.
Section 8.2. Termination of the Trust or a Series or a
Class. The Trust or any Series or Class thereof may be
terminated by (i) the affirmative vote of the holders of not less
than two-thirds of the Outstanding Shares entitled to vote and
present in person or by proxy at any meeting of Shareholders of
the Trust or the appropriate Series or Class thereof, (ii) by an
instrument or instruments in writing without a meeting, consented
to by the holders of two-thirds of the Outstanding Shares of the
Trust or a Series or Class thereof; provided, however, that, if
such termination as described in clauses (i) and (ii) is
recommended by the Trustees, the vote or written consent of the
holders of a majority of the Outstanding Shares of the Trust or a
Series or Class thereof entitled to vote shall be sufficient
authorization, or (iii) notice to Shareholders by means of an
instrument in writing signed by a majority of the Trustees,
stating that a majority of the Trustees has determined that the
continuation of the Trust or a Series or a Class thereof is not
in the best interest of such Series or a Class, the Trust or
their respective shareholders as a result of factors or events
adversely affecting the ability of such Series or a Class or the
Trust to conduct its business and operations in an economically
viable manner. Such factors and events may include (but are not
limited to) the inability of a Series or Class or the Trust to
maintain its assets at an appropriate size, changes in laws or
regulations governing the Series or Class or the Trust or
affecting assets of the type in which such Series or Class or the
Trust invests or economic developments or trends having a
significant adverse impact on the business or operations of such
Series or Class or the Trust. Upon the termination of the Trust
or the Series or Class,
(i) The Trust, Series or Class shall carry on no
business except for the purpose of winding up its affairs.
(ii) The Trustees shall proceed to wind up the affairs
of the Trust, Series or Class and all of the powers of the
Trustees under this Declaration shall continue until the
affairs of the Trust, Series or Class shall have been wound
up, including the power to fulfill or discharge the
contracts of the Trust, Series or Class, collect its assets,
sell, convey, assign, exchange, transfer or otherwise
dispose of all or any part of the remaining Trust Property
or Trust Property allocated or belonging to such Series or
Class to one or more persons at public or private sale for
consideration which may consist in whole or in part of cash,
securities or other property of any kind, discharge or pay
its liabilities, and do all other acts appropriate to
liquidate its business; provided that any sale, conveyance,
assignment, exchange, transfer or other disposition of all
or substantially all the Trust Property or Trust Property
allocated or belonging to such Series or Class that requires
Shareholder approval in accordance with Section 8.4 hereof
shall receive the approval so required.
(iii) After paying or adequately providing for the
payment of all liabilities, and upon receipt of such
releases, indemnities and refunding agreements as they deem
necessary for their protection, the Trustees may distribute
the remaining Trust Property or the remaining property of
the terminated Series or Class, in cash or in kind or partly
each, among the Shareholders of the Trust or the Series or
Class according to their respective rights.
(b) After termination of the Trust, Series or Class and
distribution to the Shareholders as herein provided, a majority
of the Trustees shall execute and lodge among the records of the
Trust and file with the Office of the Secretary of The
Commonwealth of Massachusetts an instrument in writing setting
forth the fact of such termination, and the Trustees shall
thereupon be discharged from all further liabilities and duties
with respect to the Trust or the terminated Series or Class, and
the rights and interests of all Shareholders of the Trust or the
terminated Series or Class shall thereupon cease.
Section 8.3. Amendment Procedure. (a) This Declaration may
be amended by a vote of the holders of a majority of the Shares
outstanding and entitled to vote or by any instrument in writing,
without a meeting, signed by a majority of the Trustees and
consented to by the holders of a majority of the Shares
outstanding and entitled to vote.
(b) This Declaration may be amended by a vote of a majority
of Trustees, without approval or consent of the Shareholders,
except that no amendment can be made by the Trustees to impair
any voting or other rights of shareholders prescribed by Federal
or state law. Without limiting the foregoing, the Trustees may
amend this Declaration without the approval or consent of
Shareholders (i) to change the name of the Trust or any Series,
(ii) to add to their duties or obligations or surrender any
rights or powers granted to them herein; (iii) to cure any
ambiguity, to correct or supplement any provision herein which
may be inconsistent with any other provision herein or to make
any other provisions with respect to matters or questions arising
under this Declaration which will not be inconsistent with the
provisions of this Declaration; and (iv) to eliminate or modify
any provision of this Declaration which (a) incorporates,
memorializes or sets forth an existing requirement imposed by or
under any Federal or state statute or any rule, regulation or
interpretation thereof or thereunder or (b) any rule, regulation,
interpretation or guideline of any Federal or state agency, now
or hereafter in effect, including without limitation,
requirements set forth in the 1940 Act and the rules and
regulations thereunder (and interpretations thereof), to the
extent any change in applicable law liberalizes, eliminates or
modifies any such requirements, but the Trustees shall not be
liable for failure to do so.
(c) The Trustees may also amend this Declaration without
the approval or consent of Shareholders if they deem it necessary
to conform this Declaration to the requirements of applicable
Federal or state laws or regulations or the requirements of the
regulated investment company provisions of the Internal Revenue
Code of 1986, as amended, or if requested or required to do so by
any Federal agency or by a state Blue Sky commissioner or similar
official, but the Trustees shall not be liable for failing so to
do.
(d) Nothing contained in this Declaration shall permit the
amendment of this Declaration to impair the exemption from
personal liability of the Shareholders, Trustees, officers,
employees and agents of the Trust or to permit assessments upon
Shareholders.
(e) A certificate signed by a majority of the Trustees
setting forth an amendment and reciting that it was duly adopted
by the Trustees or by the Shareholders as aforesaid or a copy of
the Declaration, as amended, and executed by a majority of the
Trustees, shall be conclusive evidence of such amendment when
lodged among the records of the Trust.
Section 8.4. Merger, Consolidation and Sale of Assets. The
Trust or any Series may merge or consolidate into any other
corporation, association, trust or other organization or may
sell, lease or exchange all or substantially all of the Trust
Property or Trust Property allocated or belonging to such Series,
including its good will, upon such terms and conditions and for
such consideration when and as authorized at any meeting of
Shareholders called for the purpose by the affirmative vote of
the holders of two-thirds of the Shares of the Trust or such
Series outstanding and entitled to vote and present in person or
by proxy at a meeting of Shareholders, or by an instrument or
instruments in writing without a meeting, consented to by the
holders of two-thirds of the Shares of the Trust or such Series;
provided, however, that, if such merger, consolidation, sale,
lease or exchange is recommended by the Trustees, the vote or
written consent of the holders of a majority of the Outstanding
Shares of the Trust or such Series entitled to vote shall be
sufficient authorization; and any such merger, consolidation,
sale, lease or exchange shall be deemed for all purposes to have
been accomplished under and pursuant to Massachusetts law.
Section 8.5. Incorporation. The Trustees may cause to be
organized or assist in organizing a corporation or corporations
under the laws of any jurisdiction or any other trust,
partnership, association or other organization to take over all
or any portion of the Trust Property or the Trust Property
allocated or belonging to such Series or to carry on any business
in which the Trust shall directly or indirectly have any
interest, and to sell, convey and transfer all or any portion of
the Trust Property or the Trust Property allocated or belonging
to such Series to any such corporation, trust, association or
organization in exchange for the shares or securities thereof or
otherwise, and to lend money to, subscribe for the shares or
securities of, and enter into any contracts with any such
corporation, trust, partnership, association or organization, or
any corporation, partnership, trust, association or organization
in which the Trust or such Series holds or is about to acquire
shares or any other interest. The Trustees may also cause a
merger or consolidation between the Trust or any successor
thereto and any such corporation, trust, partnership, association
or other organization if and to the extent permitted by law, as
provided under the law then in effect. Nothing contained herein
shall be construed as requiring approval of Shareholders for the
Trustees to organize or assist in organizing one or more
corporations, trusts, partnerships, associations or other
organizations and selling, conveying or transferring all or a
portion of the Trust Property to such organization or entities.
ARTICLE IX
REPORTS TO SHAREHOLDERS
The Trustees shall at least semi-annually submit to the
Shareholders of each Series a written financial report of the
transactions of the Trust and Series thereof, including financial
statements which shall at least annually be certified by
independent public accountants.
ARTICLE X
MISCELLANEOUS
Section 10.1. Execution and Filing. This Declaration and
any amendment hereto shall be filed in the office of the
Secretary of The Commonwealth of Massachusetts and in such other
places as may be required under the laws of Massachusetts and may
also be filed or recorded in such other places as the Trustees
deem appropriate. Each amendment so filed shall be accompanied
by a certificate signed and acknowledged by a Trustee stating
that such action was duly taken in a manner provided herein, and
unless such amendment or such certificate sets forth some later
time for the effectiveness of such amendment, such amendment
shall be effective upon its execution. A restated Declaration,
integrating into a single instrument all of the provisions of the
Declaration which are then in effect and operative, may be
executed from time to time by a majority of the Trustees and
filed with the Secretary of The Commonwealth of Massachusetts. A
restated Declaration shall, upon execution, be conclusive
evidence of all amendments contained therein and may thereafter
be referred to in lieu of the original Declaration and the
various amendments thereto.
Section 10.2. Governing Law. This Declaration is executed
by the Trustees and delivered in The Commonwealth of
Massachusetts and with reference to the laws thereof, and the
rights of all parties and the validity and construction of every
provision hereof shall be subject to and construed according to
the laws of said Commonwealth.
Section 10.3. Counterparts. This Declaration may be
simultaneously executed in several counterparts, each of which
shall be deemed to be an original, and such counterparts,
together, shall constitute one and the same instrument, which
shall be sufficiently evidenced by any such original counterpart.
Section 10.4. Reliance by Third Parties. Any certificate
executed by an individual who, according to the records of the
Trust appears to be a Trustee hereunder, certifying (a) the
number or identity of Trustees or Shareholders, (b) the due
authorization of the execution of any instrument or writing, (c)
the form of any vote passed at a meeting of Trustees or
Shareholders, (d) the fact that the number of Trustees or
Shareholders present at any meeting or executing any written
instrument satisfies the requirements of this Declaration, (e)
the form of any By-laws adopted by or the identity of any
officers elected by the Trustees, or (f) the existence of any
fact or facts which in any manner relate to the affairs of the
Trust, shall be conclusive evidence as to the matters so
certified in favor of any Person dealing with the Trustees and
their successors.
Section 10.5. Provisions in Conflict with Law or
Regulations. (a) The provisions of this Declaration are
severable, and if the Trustees shall determine, with the advice
of counsel, that any of such provisions is in conflict with the
1940 Act, the regulated investment company provisions of the
Internal Revenue Code of 1986 or with other applicable laws and
regulations, the conflicting provision shall be deemed never to
have constituted a part of this Declaration; provided, however,
that such determination shall not affect any of the remaining
provisions of this Declaration or render invalid or improper any
action taken or omitted prior to such determination.
(b) If any provision of this Declaration shall be held
invalid or unenforceable in any jurisdiction, such invalidity or
unenforceability shall attach only to such provision in such
jurisdiction and shall not in any manner affect such provision in
any other jurisdiction or any other provision of this Declaration
in any jurisdiction.
IN WITNESS WHEREOF, the undersigned have executed this
instrument as of the 8th of June, 1999.
____________________________________
Edward J. Boudreau, Jr.
as Trustee and not
individually,
34 Swan Road
Winchester, Massachusetts
01890
______________________________
______
Dennis S. Aronowitz
as Trustee and not
individually,
1216 Falls Boulevard
Fort Lauderdale, Florida
33327
______________________________
______
Stephen L. Brown
as Trustee and not
individually,
180 Beacon Street, Apt. 14G
Boston, MA 02116
______________________________
______
Richard P. Chapman, Jr.
as Trustee and not
individually,
107 Upland Road
Brookline, Massachusetts
02146
______________________________
______
William J. Cosgrove
as Trustee and not
individually,
20 Buttonwood Place
Saddle River, New Jersey
07458
______________________________
______
Douglas M. Costle
as Trustee and not
individually,
RR2 Box 480
Woodstock, Vermont 05091
______________________________
______
Leland O. Erdahl
as Trustee and not
individually,
8046 MacKenzie Court
Las Vegas, Nevada 89129
______________________________
______
Richard A. Farrell
as Trustee and not
individually,
50 Beacon Street
Marblehead, Massachusetts
01945
______________________________
______
Gail D. Fosler
as Trustee and not
individually,
3054 So. Abingdon Street
Arlington, VA 22206
______________________________
______
William F. Glavin
as Trustee and not
individually,
120 Paget Court
Vero Beach, Florida 32963
______________________________
______
Anne C. Hodsdon
as Trustee and not
individually,
135 Woodland Road
Hampton, New Hampshire 03842
______________________________
______
Dr. John A. Moore
as Trustee and not
individually,
P.O. Box 474
Wicomico, Virginia 22579
______________________________
______
Patti McGill Peterson
as Trustee and not
individually,
P.O. Box 34
King Ferry, NY 13081
______________________________
______
John W. Pratt
as Trustee and not
individually,
2 Gray Gardens East
Cambridge, Massachusetts
02138
______________________________
______
Richard S. Scipione
as Trustee and not
individually,
4 Sentinel Road
Hingham, Massachusetts 02043
THE COMMONWEALTH OF MASSACHUSETTS
SUFFOLK COUNTY, MASSACHUSETTS
_______________,
1999
Then personally appeared the above-named persons, Edward J.
Boudreau, Jr., Dennis S. Aronowitz, Stephen L. Brown, Richard P.
Chapman, Jr., William J. Cosgrove, Leland O. Erdahl, Richard A.
Farrell, Gail D. Fosler, William F. Glavin, Anne C. Hodsdon, John
A. Moore, Patti McGill Peterson, John W. Pratt, and Richard S.
Scipione, who acknowledged the foregoing instrument to be his
free act and deed.
Before me,
___________________________________
Notary Public
My commission expires:
s:\funds\strategic\dectrust
43
1
EXHIBIT A
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement") is
made this 9th day of June, 1999, by and between John Hancock
Strategic Income Fund (the "Acquiring Fund"), a series of John
Hancock Strategic Series, a Massachusetts business trust (the
"Trust II"), and John Hancock Short-Term Strategic Income Fund
(the "Acquired Fund"), a series of John Hancock Investment Trust
III, a Massachusetts business trust (the "Trust") each with their
principal place of business at 101 Huntington Avenue, Boston,
Massachusetts 02199. The Acquiring Fund and the Acquired Fund
are sometimes referred to collectively herein as the "Funds" and
individually as a "Fund."
This Agreement is intended to be and is adopted as a plan of
"reorganization," as such term is used in Section 368(a) of the
Internal Revenue Code of 1986, as amended (the "Code"). The
reorganization will consist of the transfer of all of the assets
of the Acquired Fund to the Acquiring Fund in exchange solely for
the issuance of Class A, Class B, and Class C shares of
beneficial interest of the Acquiring Fund (the "Acquiring Fund
Shares") to the Acquired Fund and the assumption by the Acquiring
Fund of all of the liabilities of the Acquired Fund, followed by
the distribution by the Acquired Fund, on or promptly after the
Closing Date hereinafter referred to, of the Acquiring Fund
Shares to the shareholders of the Acquired Fund in liquidation
and termination of the Acquired Fund as provided herein, all upon
the terms and conditions set forth in this Agreement.
In consideration of the premises of the covenants and agreements
hereinafter set forth, the parties hereto covenant and agree as
follows:
1. TRANSFER OF ASSETS OF THE ACQUIRED FUND IN EXCHANGE FOR
ASSUMPTION OF LIABILITIES AND ISSUANCE OF ACQUIRING FUND
SHARES; LIQUIDATION OF THE ACQUIRED FUND
1.1 The Acquired Fund will transfer all of its assets
(consisting, without limitation, of portfolio securities and
instruments, dividends and interest receivables, cash and
other assets), as set forth in the statement of assets and
liabilities referred to in Paragraph 7.2 hereof (the
"Statement of Assets and Liabilities"), to the Acquiring Fund
free and clear of all liens and encumbrances, except as
otherwise provided herein, in exchange for (i) the assumption
by the Acquiring Fund of the known and unknown liabilities of
the Acquired Fund, including the liabilities set forth in the
Statement of Assets and Liabilities (the "Acquired Fund
Liabilities"), which shall be assigned and transferred to the
Acquiring Fund by the Acquired Fund and assumed by the
Acquiring Fund, and (ii) delivery by the Acquiring Fund to
the Acquired Fund, for distribution pro rata by the Acquired
Fund to its shareholders in proportion to their respective
ownership of Class A, Class B and/or Class C shares of
beneficial interest of the Acquired Fund, as of the close of
business on October 22, 1999 (the "Closing Date"), of a
number of the Acquiring Fund Shares having an aggregate net
asset value equal, in the case of each class of Acquiring
Fund Shares, to the value of the assets, less such
liabilities (herein referred to as the "net value of the
assets") attributable to the applicable class, assumed,
assigned and delivered, all determined as provided in
Paragraph 2.1 hereof and as of a date and time as specified
therein. Such transactions shall take place at the closing
provided for in Paragraph 3.1 hereof (the "Closing"). All
computations with respect to the Acquiring Fund shall be
provided by Investors Bank & Trust Company (the "Acquiring
Fund's Custodian"), as custodian and pricing agent for the
Acquiring Fund and, and with respect to the Acquired Fund by
State Street Bank and Trust Company (the "Acquired Fund's
Custodian).
1.2 The Acquired Fund has provided the Acquiring Fund with a list
of the current securities holdings of the Acquired Fund as of
the date of execution of this Agreement. The Acquired Fund
reserves the right to sell any of these securities (except to
the extent sales may be limited by representations made in
connection with issuance of the tax opinion provided for in
paragraph 8.6 hereof) but will not, without the prior
approval of the Acquiring Fund, acquire any additional
securities other than securities of the type in which the
Acquiring Fund is permitted to invest.
1.3 The Acquiring Fund and the Acquired Fund shall each bear its
own expenses in connection with the transactions contemplated
by this Agreement.
1.4 On or as soon after the Closing Date as is conveniently
practicable (the "Liquidation Date"), the Acquired Fund will
liquidate and distribute pro rata to shareholders of record
(the "Acquired Fund shareholders"), determined as of the
close of regular trading on the New York Stock Exchange on
the Closing Date, the Acquiring Fund Shares received by the
Acquired Fund pursuant to Paragraph 1.1 hereof. Such
liquidation and distribution will be accomplished by the
transfer of the Acquiring Fund Shares then credited to the
account of the Acquired Fund on the books of the Acquiring
Fund, to open accounts on the share records of the Acquiring
Fund in the names of the Acquired Fund shareholders and
representing the respective pro rata number and class of
Acquiring Fund Shares due such shareholders. Acquired Fund
shareholders who own Class A shares of the Acquired Fund will
receive Class A Acquiring Fund Shares, Acquired Fund
shareholders who own Class B shares of the Acquired Fund will
receive Class B Acquiring Fund Shares, and Acquired Fund
shareholders who own Class C shares of the Acquired Fund will
receive Class C Acquiring Fund Shares,. The Acquiring Fund
shall not issue certificates representing Acquiring Fund
Shares in connection with such exchange.
1.5 The Acquired Fund shareholders holding certificates
representing their ownership of shares of beneficial interest
of the Acquired Fund shall surrender such certificates or
deliver an affidavit with respect to lost certificates in
such form and accompanied by such surety bonds as the
Acquired Fund may require (collectively, an "Affidavit"), to
John Hancock Signature Services, Inc. prior to the Closing
Date. Any Acquired Fund share certificate which remains
outstanding on the Closing Date shall be deemed to be
canceled, shall no longer evidence ownership of shares of
beneficial interest of the Acquired Fund and shall evidence
ownership of Acquiring Fund Shares. Unless and until any
such certificate shall be so surrendered or an Affidavit
relating thereto shall be delivered, dividends and other
distributions payable by the Acquiring Fund subsequent to the
Liquidation Date with respect to Acquiring Fund Shares shall
be paid to the holder of such certificate(s), but such
shareholders may not redeem or transfer Acquiring Fund Shares
received in the Reorganization. The Acquiring Fund will not
issue share certificates in the Reorganization.
1.6 Any transfer taxes payable upon issuance of Acquiring Fund
Shares in a name other than the registered holder of the
Acquired Fund Shares on the books of the Acquired Fund as of
that time shall, as a condition of such issuance and
transfer, be paid by the person to whom such Acquiring Fund
Shares are to be issued and transferred.
1.7 The existence of the Acquired Fund shall be terminated as
promptly as practicable following the Liquidation Date.
1.8 Any reporting responsibility of the Trust, including, but not
limited to, the responsibility for filing of regulatory
reports, tax returns, or other documents with the Securities
and Exchange Commission (the "Commission"), any state
securities commissions, and any federal, state or local tax
authorities or any other relevant regulatory authority, is
and shall remain the responsibility of the Trust.
2. VALUATION
2.1 The net asset values of the Class A, Class B and Class C
Acquiring Fund Shares and the net values of the assets and
liabilities of the Acquired Fund attributable to its Class A,
Class B and Class C shares to be transferred shall, in each
case, be determined as of the close of business (4:00 p.m.
Boston time) on the Closing Date. The net asset values of
the Class A, Class B, and Class C Acquiring Fund Shares shall
be computed by the Acquiring Fund's Custodian in the manner
set forth in the Acquiring Fund's Declaration of Trust as
amended and restated (the "Declaration"), or By-Laws and the
Acquiring Fund's then-current prospectus and statement of
additional information and shall be computed in each case to
not fewer than four decimal places. The net values of the
assets of the Acquired Fund attributable to its Class A,
Class B, and Class C shares to be transferred shall be
computed by the Acquired Fund's Custodian by calculating the
value of the assets of each class transferred by the Acquired
Fund and by subtracting therefrom the amount of the
liabilities of each class assigned and transferred to and
assumed by the Acquiring Fund on the Closing Date, said
assets and liabilities to be valued in the manner set forth
in the Acquired Fund's then current prospectus and statement
of additional information and shall be computed in each case
to not fewer than four decimal places.
2.2 The number of shares of each class of Acquiring Fund Shares
to be issued (including fractional shares, if any) in
exchange for the Acquired Fund's assets shall be determined
by dividing the value of the Acquired Fund's assets
attributable to a class, less the liabilities attributable to
that class assumed by the Acquiring Fund, by the Acquiring
Fund's net asset value per share of the same class, all as
determined in accordance with Paragraph 2.1 hereof.
2.3 All computations of value shall be made by each Custodian in
accordance with its regular practice as pricing agent for its
respective Fund.
3. CLOSING AND CLOSING DATE
3.1 The Closing Date shall be October 22, 1999 or such other date
on or before April 30, 2000 as the parties may agree. The
Closing shall be held as of 5:00 p.m. at the offices of the
Trust II and the Trust, 101 Huntington Avenue, Boston,
Massachusetts 02199, or at such other time and/or place as
the parties may agree.
3.2 Portfolio securities that are not held in book-entry form in
the name of the Acquired Fund's Custodian as record holder
for the Acquired Fund shall be presented by the Acquired Fund
to the Acquiring Fund's Custodian for examination no later
than five business days preceding the Closing Date.
Portfolio securities which are not held in book-entry form
shall be delivered by the Acquired Fund to the Acquiring
Fund's Custodian for the account of the Acquiring Fund on the
Closing Date, duly endorsed in proper form for transfer, in
such condition as to constitute good delivery thereof in
accordance with the custom of brokers, and shall be
accompanied by all necessary federal and state stock transfer
stamps or a check for the appropriate purchase price thereof.
Portfolio securities held of record by the Acquired Fund's
Custodian in book-entry form on behalf of the Acquired Fund
shall be delivered to the Acquiring Fund by the Acquiring
Fund's Custodian by recording the transfer of beneficial
ownership thereof on its records. The cash delivered shall
be in the form of currency or by the Acquiring Fund's
Custodian crediting the Acquiring Fund's account maintained
with the Acquiring Fund's Custodian with immediately
available funds.
3.3 In the event that on the Closing Date (a) the New York Stock
Exchange shall be closed to trading or trading thereon shall
be restricted or (b) trading or the reporting of trading on
said Exchange or elsewhere shall be disrupted so that
accurate appraisal of the value of the net assets of the
Acquiring Fund or the Acquired Fund is impracticable, the
Closing Date shall be postponed until the first business day
after the day when trading shall have been fully resumed and
reporting shall have been restored; provided that if trading
shall not be fully resumed and reporting restored on or
before April 30, 2000, this Agreement may be terminated by
the Acquiring Fund or by the Acquired Fund upon the giving of
written notice to the other party.
3.4 The Acquired Fund shall deliver at the Closing a list of the
names, addresses, federal taxpayer identification numbers and
backup withholding and nonresident alien withholding status
of the Acquired Fund shareholders and the number of
outstanding shares of each class of beneficial interest of
the Acquired Fund owned by each such shareholder, all as of
the close of business on the Closing Date, certified by its
Treasurer, Secretary or other authorized officer (the
"Shareholder List"). The Acquiring Fund shall issue and
deliver to the Acquired Fund a confirmation evidencing the
Acquiring Fund Shares to be credited on the Closing Date, or
provide evidence satisfactory to the Acquired Fund that such
Acquiring Fund Shares have been credited to the Acquired
Fund's account on the books of the Acquiring Fund. At the
Closing, each party shall deliver to the other such bills of
sale, checks, assignments, stock certificates, receipts or
other documents as such other party or its counsel may
reasonably request.
4. REPRESENTATIONS AND WARRANTIES
4.1 The Trust on behalf of the Acquired Fund represents, warrants
and covenants to the Acquiring Fund as follows:
(a) The Trust is a business trust, duly organized, validly
existing and in good standing under the laws of The
Commonwealth of Massachusetts and has the power to own all
of its properties and assets and, subject to approval by the
shareholders of the Acquired Fund, to carry out the
transactions contemplated by this Agreement. Neither the
Trust nor the Acquired Fund is required to qualify to do
business in any jurisdiction in which it is not so qualified
or where failure to qualify would subject it to any material
liability or disability. The Trust has all necessary
federal, state and local authorizations to own all of its
properties and assets and to carry on its business as now
being conducted;
(b) The Trust is a registered investment company classified as
a management company and its registration with the
Commission as an investment company under the Investment
Company Act of 1940, as amended (the "1940 Act"), is in full
force and effect. The Acquired Fund is a diversified series
of the Trust;
(c) The Trust and the Acquired Fund are not, and the execution,
delivery and performance of their obligations under this
Agreement will not result, in violation of any provision of
the Trust's Declaration of Trust, as amended and restated
(the "Trust's Declaration") or By-Laws or of any agreement,
indenture, instrument, contract, lease or other undertaking
to which the Trust or the Acquired Fund is a party or by
which it is bound;
(d) Except as otherwise disclosed in writing and accepted by
the Acquiring Fund, no material litigation or administrative
proceeding or investigation of or before any court or
governmental body is currently pending or threatened against
the Trust or the Acquired Fund or any of the Acquired Fund's
properties or assets. The Trust knows of no facts which
might form the basis for the institution of such
proceedings, and neither the Trust nor the Acquired Fund is
a party to or subject to the provisions of any order, decree
or judgment of any court or governmental body which
materially and adversely affects the Acquired Fund's
business or its ability to consummate the transactions
herein contemplated;
(e) The Acquired Fund has no material contracts or other
commitments (other than this Agreement or agreements for the
purchase of securities entered into in the ordinary course
of business and consistent with its obligations under this
Agreement) which will not be terminated without liability to
the Acquired Fund at or prior to the Closing Date;
(f) The audited statement of assets and liabilities, including
the schedule of investments, of the Acquired Fund as of
October 31, 1998 and the related statement of operations
(copies of which have been furnished to the Acquiring Fund)
and the unaudited statements as of April 30, 1999, present
fairly in all material respects the financial condition of
the Acquired Fund as of October 31, 1998 and April 30, 1999
and the results of its operations for the period then ended
in accordance with generally accepted accounting principles
consistently applied, and there were no known actual or
contingent liabilities of the Acquired Fund as of the
respective dates thereof not disclosed therein;
(g) Since April 30, 1999, there has not been any material
adverse change in the Acquired Fund's financial condition,
assets, liabilities, or business other than changes
occurring in the ordinary course of business, or any
incurrence by the Acquired Fund of indebtedness maturing
more than one year from the date such indebtedness was
incurred, except as otherwise disclosed to and accepted by
the Acquiring Fund;
(h) At the date hereof and by the Closing Date, all federal,
state and other tax returns and reports, including
information returns and payee statements, of the Acquired
Fund required by law to have been filed or furnished by such
dates shall have been filed or furnished, and all federal,
state and other taxes, interest and penalties shall have
been paid so far as due, or provision shall have been made
for the payment thereof, and to the best of the Acquired
Fund's knowledge no such return is currently under audit and
no assessment has been asserted with respect to such returns
or reports;
(i) Each of the Acquired Fund and its predecessors has
qualified as a regulated investment company for each taxable
year of its operation and the Acquired Fund will qualify as
such as of the Closing Date with respect to its taxable year
ending on the Closing Date;
(j) The authorized capital of the Acquired Fund consists of an
unlimited number of shares of beneficial interest, no par
value. All issued and outstanding shares of beneficial
interest of the Acquired Fund are, and at the Closing Date
will be, duly and validly issued and outstanding, fully paid
and nonassessable by the Trust. All of the issued and
outstanding shares of beneficial interest of the Acquired
Fund will, at the time of Closing, be held by the persons and
in the amounts and classes set forth in the Shareholder List
submitted to the Acquiring Fund pursuant to Paragraph 3.4
hereof. The Acquired Fund does not have outstanding any
options, warrants or other rights to subscribe for or
purchase any of its shares of beneficial interest, nor is
there outstanding any security convertible into any of its
shares of beneficial interest;
(k) At the Closing Date, the Acquired Fund will have good and
marketable title to the assets to be transferred to the
Acquiring Fund pursuant to Paragraph 1.1 hereof, and full
right, power and authority to sell, assign, transfer and
deliver such assets hereunder, and upon delivery and payment
for such assets, the Acquiring Fund will acquire good and
marketable title thereto subject to no restrictions on the
full transfer thereof, including such restrictions as might
arise under the Securities Act of 1933, as amended (the
"1933 Act");
(l) The execution, delivery and performance of this Agreement
have been duly authorized by all necessary action on the part
of the Trust on behalf of the Acquired Fund, and this
Agreement constitutes a valid and binding obligation of the
Trust and the Acquired Fund enforceable in accordance with
its terms, subject to the approval of the Acquired Fund's
shareholders;
(m) The information to be furnished by the Acquired Fund to the
Acquiring Fund for use in applications for orders,
registration statements, proxy materials and other documents
which may be necessary in connection with the transactions
contemplated hereby shall be accurate and complete and shall
comply in all material respects with federal securities and
other laws and regulations thereunder applicable thereto;
(n) The proxy statement of the Acquired Fund (the "Proxy
Statement") to be included in the Registration Statement
referred to in Paragraph 5.7 hereof (other than written
information furnished by the Acquiring Fund for inclusion
therein, as covered by the Acquiring Fund's warranty in
Paragraph 4.2(m) hereof), on the effective date of the
Registration Statement, on the date of the meeting of the
Acquired Fund shareholders and on the Closing Date, shall
not contain any untrue statement of a material fact or omit
to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the
circumstances under which such statements were made, not
misleading;
(o) No consent, approval, authorization or order of any court
or governmental authority is required for the consummation
by the Acquired Fund of the transactions contemplated by
this Agreement;
(p) All of the issued and outstanding shares of beneficial
interest of the Acquired Fund have been offered for sale and
sold in conformity with all applicable federal and state
securities laws;
(q) The prospectus of the Acquired Fund, dated March 1, 1999
(the "Acquired Fund Prospectus"), previously furnished to
the Acquiring Fund, does not contain any untrue statement of
a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements
therein, in light of the circumstances in which they were
made, not misleading.
4.2 The Trust II on behalf of the Acquiring Fund represents,
warrants and covenants to the Acquired Fund as follows:
(a) The Trust II is a business trust duly organized, validly
existing and in good standing under the laws of The
Commonwealth of Massachusetts and has the power to own all
of its properties and assets and to carry out the Agreement.
Neither the Trust II nor the Acquiring Fund is required to
qualify to do business in any jurisdiction in which it is
not so qualified or where failure to qualify would subject
it to any material liability or disability. The Trust II
has all necessary federal, state and local authorizations to
own all of its properties and assets and to carry on its
business as now being conducted;
(b) The Trust II is a registered investment company classified
as a management company and its registration with the
Commission as an investment company under the 1940 Act is in
full force and effect. The Acquiring Fund is a diversified
series of the Trust II;
(c) The prospectus (the "Acquiring Fund Prospectus") and
statement of additional information for Class A, Class B,
and Class C shares of the Acquiring Fund, each dated April
1, 1999, and any amendments or supplements thereto on or
prior to the Closing Date, and the Registration Statement on
Form N-14 to be filed in connection with this Agreement (the
"Registration Statement") (other than written information
furnished by the Acquired Fund for inclusion therein, as
covered by the Acquired Fund's warranty in Paragraph 4.1(m)
hereof) will conform in all material respects to the
applicable requirements of the 1933 Act and the 1940 Act and
the rules and regulations of the Commission thereunder, the
Acquiring Fund Prospectus does not include any untrue
statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under
which they were made, not misleading and the Registration
Statement will not include any untrue statement of material
fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made,
not misleading;
(d) At the Closing Date, the Trust II on behalf of the
Acquiring Fund will have good and marketable title to the
assets of the Acquiring Fund;
(e) The Trust II and the Acquiring Fund are not, and the
execution, delivery and performance of their obligations
under this Agreement will not result, in violation of any
provisions of the Trust II's Declaration, or By-Laws or of
any agreement, indenture, instrument, contract, lease or
other undertaking to which the Trust II or the Acquiring
Fund is a party or by which the Trust II or the Acquiring
Fund is bound;
(f) Except as otherwise disclosed in writing and accepted by
the Acquired Fund, no material litigation or administrative
proceeding or investigation of or before any court or
governmental body is currently pending or threatened against
the Trust II or the Acquiring Fund or any of the Acquiring
Fund's properties or assets. The Trust II knows of no facts
which might form the basis for the institution of such
proceedings, and neither the Trust II nor the Acquiring Fund
is a party to or subject to the provisions of any order,
decree or judgment of any court or governmental body which
materially and adversely affects the Acquiring Fund's
business or its ability to consummate the transactions herein
contemplated;
(g) The audited statement of assets and liabilities, including
the schedule of investments, of the Acquiring Fund as of May
31, 1999 and the related statement of operations (copies of
which have been furnished to the Acquired Fund) present
fairly in all material respects the financial condition of
the Acquiring Fund as of May 31, 1999 and the results of its
operations for the period then ended in accordance with
generally accepted accounting principles consistently
applied, and there were no known actual or contingent
liabilities of the Acquiring Fund as of the respective dates
thereof not disclosed therein;
(h) Since May 31, 1999, there has not been any material adverse
change in the Acquiring Fund's financial condition, assets,
liabilities or business other than changes occurring in the
ordinary course of business, or any incurrence by the Trust
II on behalf of the Acquiring Fund of indebtedness maturing
more than one year from the date such indebtedness was
incurred, except as disclosed to and accepted by the
Acquired Fund;
(i) Each of the Acquiring Fund and its predecessors has
qualified as a regulated investment company for each taxable
year of its operation and the Acquiring Fund will qualify as
such as of the Closing Date;
(j) The authorized capital of the Trust II consists of an
unlimited number of shares of beneficial interest, no par
value per share. All issued and outstanding shares of
beneficial interest of the Acquiring Fund are, and at the
Closing Date will be, duly and validly issued and
outstanding, fully paid and nonassessable by the Trust II.
The Acquiring Fund does not have outstanding any options,
warrants or other rights to subscribe for or purchase any of
its shares of beneficial interest, nor is there outstanding
any security convertible into any of its shares of beneficial
interest;
(k) The execution, delivery and performance of this Agreement
has been duly authorized by all necessary action on the part
of the Trust II on behalf of the Acquiring Fund, and this
Agreement constitutes a valid and binding obligation of the
Acquiring Fund enforceable in accordance with its terms;
(l) The Acquiring Fund Shares to be issued and delivered to the
Acquired Fund pursuant to the terms of this Agreement, when
so issued and delivered, will be duly and validly issued
shares of beneficial interest of the Acquiring Fund and will
be fully paid and nonassessable by the Trust II;
(m) The information to be furnished by the Acquiring Fund for
use in applications for orders, registration statements,
proxy materials and other documents which may be necessary
in connection with the transactions contemplated hereby
shall be accurate and complete and shall comply in all
material respects with federal securities and other laws and
regulations applicable thereto; and
(n) No consent, approval, authorization or order of any court
or governmental authority is required for the consummation
by the Acquiring Fund of the transactions contemplated by
the Agreement, except for the registration of the Acquiring
Fund Shares under the 1933 Act and the 1940 Act.
5. COVENANTS OF THE ACQUIRING FUND AND THE ACQUIRED FUND
5.1 Except as expressly contemplated herein to the contrary, the
Trust on behalf of the Acquired Fund and the Trust II on
behalf of Acquiring Fund, will operate their respective
businesses in the ordinary course between the date hereof and
the Closing Date, it being understood that such ordinary
course of business will include customary dividends and
distributions and any other distributions necessary or
desirable to avoid federal income or excise taxes.
5.2 The Trust will call a meeting of the Acquired Fund
shareholders to consider and act upon this Agreement and to
take all other action necessary to obtain approval of the
transactions contemplated herein.
5.3 The Acquired Fund covenants that the Acquiring Fund Shares to
be issued hereunder are not being acquired by the Acquired
Fund for the purpose of making any distribution thereof other
than in accordance with the terms of this Agreement.
5.4 The Trust on behalf of the Acquired Fund will provide such
information within its possession or reasonably obtainable as
the Trust II on behalf of the Acquiring Fund requests
concerning the beneficial ownership of the Acquired Fund's
shares of beneficial interest.
5.5 Subject to the provisions of this Agreement, the Acquiring
Fund and the Acquired Fund each shall take, or cause to be
taken, all action, and do or cause to be done, all things
reasonably necessary, proper or advisable to consummate the
transactions contemplated by this Agreement.
5.6 The Trust on behalf of the Acquired Fund shall furnish to the
Trust II on behalf of the Acquiring Fund on the Closing Date
the Statement of Assets and Liabilities of the Acquired Fund
as of the Closing Date, which statement shall be prepared in
accordance with generally accepted accounting principles
consistently applied and shall be certified by the Acquired
Fund's Treasurer or Assistant Treasurer. As promptly as
practicable but in any case within 60 days after the Closing
Date, the Acquired Fund shall furnish to the Acquiring Fund,
in such form as is reasonably satisfactory to the Trust II, a
statement of the earnings and profits of the Acquired Fund
for federal income tax purposes and of any capital loss
carryovers and other items that will be carried over to the
Acquiring Fund as a result of Section 381 of the Code, and
which statement will be certified by the President of the
Acquired Fund.
5.7 The Trust II on behalf of the Acquiring Fund will prepare and
file with the Commission the Registration Statement in
compliance with the 1933 Act and the 1940 Act in connection
with the issuance of the Acquiring Fund Shares as
contemplated herein.
5.8 The Trust on behalf of the Acquired Fund will prepare a Proxy
Statement, to be included in the Registration Statement in
compliance with the 1933 Act, the Securities Exchange Act of
1934, as amended (the "1934 Act"), and the 1940 Act and the
rules and regulations thereunder (collectively, the "Acts")
in connection with the special meeting of shareholders of the
Acquired Fund to consider approval of this Agreement.
6. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE TRUST ON BEHALF OF
THE ACQUIRED FUND
The obligations of the Trust on behalf of the Acquired Fund to
complete the transactions provided for herein shall be, at its
election, subject to the performance by the Trust II on behalf of
the Acquiring Fund of all the obligations to be performed by it
hereunder on or before the Closing Date, and, in addition
thereto, the following further conditions:
6.1 All representations and warranties of the Trust II on behalf
of the Acquiring Fund contained in this Agreement shall be
true and correct in all material respects as of the date
hereof and, except as they may be affected by the
transactions contemplated by this Agreement, as of the
Closing Date with the same force and effect as if made on and
as of the Closing Date; and
6.2 The Trust II on behalf of the Acquiring Fund shall have
delivered to the Acquired Fund a certificate executed in its
name by the Trust II's President or Vice President and its
Treasurer or Assistant Treasurer, in form and substance
satisfactory to the Acquired Fund and dated as of the Closing
Date, to the effect that the representations and warranties
of the Trust II on behalf of the Acquiring Fund made in this
Agreement are true and correct at and as of the Closing Date,
except as they may be affected by the transactions
contemplated by this Agreement, and as to such other matters
as the Trust on behalf of the Acquired Fund shall reasonably
request.
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE TRUST II ON BEHALF
OF THE ACQUIRING FUND
The obligations of the Trust II on behalf of the Acquiring Fund
to complete the transactions provided for herein shall be, at its
election, subject to the performance by the Acquired Fund of all
the obligations to be performed by it hereunder on or before the
Closing Date and, in addition thereto, the following conditions:
7.1 All representations and warranties of the Acquired Fund
contained in this Agreement shall be true and correct in all
material respects as of the date hereof and, except as they
may be affected by the transactions contemplated by this
Agreement, as of the Closing Date with the same force and
effect as if made on and as of the Closing Date;
7.2 The Trust on behalf of the Acquired Fund shall have delivered
to the Trust II on behalf of the Acquiring Fund the Statement
of Assets and Liabilities of the Acquired Fund, together with
a list of its portfolio securities showing the federal income
tax bases and holding periods of such securities, as of the
Closing Date, certified by the Treasurer or Assistant
Treasurer of the Trust;
7.3 The Trust on behalf of the Acquired Fund shall have delivered
to the Trust II on behalf of the Acquiring Fund on the
Closing Date a certificate executed in the name of the
Acquired Fund by a President or Vice President and a
Treasurer or Assistant Treasurer of the Trust, in form and
substance satisfactory to the Trust II on behalf of the
Acquiring Fund and dated as of the Closing Date, to the
effect that the representations and warranties of the
Acquired Fund in this Agreement are true and correct at and
as of the Closing Date, except as they may be affected by the
transactions contemplated by this Agreement, and as to such
other matters as the Trust II on behalf of the Acquiring Fund
shall reasonably request; and
7.4 At or prior to the Closing Date, the Acquired Fund's
investment adviser, or an affiliate thereof, shall have made
all payments, or applied all credits, to the Acquired Fund
required by any applicable contractual expense limitation.
8. FURTHER CONDITIONS PRECEDENT TO OBLIGATIONS OF THE TRUST AND
THE TRUST II
The obligations hereunder of the Trust II on behalf of the
Acquiring Fund and the Trust on behalf of the Acquired Fund are
each subject to the further conditions that on or before the
Closing Date:
8.1 The Agreement and the transactions contemplated herein shall
have been approved by the requisite vote of the holders of
the outstanding shares of beneficial interest of the Acquired
Fund in accordance with the provisions of the Trust's
Declaration and By-Laws, and certified copies of the
resolutions evidencing such approval by the Acquired Fund's
shareholders shall have been delivered by the Acquired Fund
to the Trust II on behalf of the Acquiring Fund;
8.2 On the Closing Date no action, suit or other proceeding shall
be pending before any court or governmental agency in which
it is sought to restrain or prohibit, or obtain changes or
other relief in connection with, this Agreement or the
transactions contemplated herein;
8.3 All consents of other parties and all other consents, orders
and permits of federal, state and local regulatory
authorities (including those of the Commission and their "no-
action" positions) deemed necessary by the Trust or the Trust
II to permit consummation, in all material respects, of the
transactions contemplated hereby shall have been obtained,
except where failure to obtain any such consent, order or
permit would not involve a risk of a material adverse effect
on the assets or properties of the Acquiring Fund or the
Acquired Fund, provided that either party hereto may waive
any such conditions for itself;
8.4 The Registration Statement shall have become effective under
the 1933 Act and the 1940 Act and no stop orders suspending
the effectiveness thereof shall have been issued and, to the
best knowledge of the parties hereto, no investigation or
proceeding for that purpose shall have been instituted or be
pending, threatened or contemplated under the 1933 Act or the
1940 Act;
8.5 The Acquired Fund shall have distributed to its shareholders,
in a distribution or distributions qualifying for the
deduction for dividends paid under Section 561 of the Code,
all of its investment company taxable income (as defined in
Section 852(b)(2) of the Code determined without regard to
Section 852(b)(2)(D) of the Code) for its taxable year ending
on the Closing Date, all of the excess of (i) its interest
income excludable from gross income under Section 103(a) of
the Code over (ii) its deductions disallowed under Sections
265 and 171(a)(2) of the Code for its taxable year ending on
the Closing Date, and all of its net capital gain (as such
term is used in Sections 852(b)(3)(A) and (C) of the Code),
after reduction by any available capital loss carryforward,
for its taxable year ending on the Closing Date; and
8.6 The parties shall have received an opinion of Hale and Dorr
LLP, satisfactory to the Trust on behalf of the Acquired Fund
and the Trust II on behalf of the Acquiring Fund,
substantially to the effect that for federal income tax
purposes:
(a) The acquisition by the Acquiring Fund of all of the assets
of the Acquired Fund solely in exchange for the issuance of
Acquiring Fund Shares to the Acquired Fund and the
assumption of all of the Acquired Fund Liabilities by the
Acquiring Fund, followed by the distribution by the Acquired
Fund, in liquidation of the Acquired Fund, of Acquiring Fund
Shares to the shareholders of the Acquired Fund in exchange
for their shares of beneficial interest of the Acquired Fund
and the termination of the Acquired Fund, will constitute a
"reorganization" within the meaning of Section 368(a) of the
Code, and the Acquired Fund and the Acquiring Fund will each
be "a party to a reorganization" within the meaning of
Section 368(b) of the Code;
(b) No gain or loss will be recognized by the Acquired Fund
upon (i) the transfer of all of its assets to the Acquiring
Fund solely in exchange for the issuance of Acquiring Fund
Shares to the Acquired Fund and the assumption of all of the
Acquired Fund Liabilities by the Acquiring Fund; and (ii)
the distribution by the Acquired Fund of such Acquiring Fund
Shares to the shareholders of the Acquired Fund;
(c) No gain or loss will be recognized by the Acquiring Fund
upon the receipt of the assets of the Acquired Fund solely
in exchange for the issuance of the Acquiring Fund Shares to
the Acquired Fund and the assumption of all of the Acquired
Fund Liabilities by the Acquiring Fund;
(d) The basis of the assets of the Acquired Fund acquired by
the Acquiring Fund will be, in each instance, the same as
the basis of those assets in the hands of the Acquired Fund
immediately prior to the transfer;
(e) The tax holding period of the assets of the Acquired Fund
in the hands of the Acquiring Fund will, in each instance,
include the Acquired Fund's tax holding period for those
assets;
(f) The shareholders of the Acquired Fund will not recognize
gain or loss upon the exchange of all of their shares of
beneficial interest of the Acquired Fund solely for Acquiring
Fund Shares as part of the transaction;
(g) The basis of the Acquiring Fund Shares received by the
Acquired Fund shareholders in the transaction will be the
same as the basis of the shares of beneficial interest of
the Acquired Fund surrendered in exchange therefor; and
(h) The tax holding period of the Acquiring Fund Shares
received by the Acquired Fund shareholders will include, for
each shareholder, the tax holding period for the shares of
the Acquired Fund surrendered in exchange therefor, provided
that the Acquired Fund shares were held as capital assets on
the date of the exchange.
The Trust II and the Trust agree to make and provide
representations with respect to the Acquiring Fund and the
Acquired Fund, respectively, which are reasonably necessary to
enable Hale and Dorr LLP to deliver an opinion substantially as
set forth in this Paragraph 8.6. Notwithstanding anything herein
to the contrary, neither the Trust nor the Trust II may waive the
conditions set forth in this Paragraph 8.6.
9. BROKERAGE FEES AND EXPENSES
9.1 The Trust II on behalf of the Acquiring Fund, and the Trust
on behalf of the Acquired Fund each represent and warrant to
the other that there are no brokers or finders entitled to
receive any payments in connection with the transactions
provided for herein.
9.2 The Acquiring Fund and the Acquired Fund shall each be liable
solely for its own expenses incurred in connection with
entering into and carrying out the provisions of this
Agreement whether or not the transactions contemplated hereby
are consummated.
10. ENTIRE AGREEMENT; SURVIVAL OF WARRANTIES
10.1 The Trust II on behalf of the Acquiring Fund, and the Trust
on behalf of the Acquired Fund agree that neither party has
made any representation, warranty or covenant not set forth
herein or referred to in Paragraph 4 hereof and that this
Agreement constitutes the entire agreement between the
parties.
10.2 The representations, warranties and covenants contained in
this Agreement or in any document delivered pursuant hereto
or in connection herewith shall survive the consummation of
the transactions contemplated hereunder.
11. TERMINATION
11.1 This Agreement may be terminated by the mutual agreement of
the Trust II, on behalf of the Acquiring Fund, and the Trust
on behalf of the Acquired Fund. In addition, either party
may at its option terminate this Agreement at or prior to the
Closing Date:
(a) because of a material breach by the other of any
representation, warranty, covenant or agreement contained
herein to be performed at or prior to the Closing Date;
(b) because of a condition herein expressed to be precedent to
the obligations of the terminating party which has not been
met and which reasonably appears will not or cannot be met;
(c) by resolution of the Trust II's Board of Trustees if
circumstances should develop that, in the good faith opinion
of such Board, make proceeding with the Agreement not in the
best interests of the Acquiring Fund's shareholders; or
(d) by resolution of the Trust's Board of Trustees if
circumstances should develop that, in the good faith opinion
of such Board, make proceeding with the Agreement not in the
best interests of the Acquired Fund's shareholders.
11.2 In the event of any such termination, there shall be no
liability for damages on the part of the Trust II, the
Acquiring Fund, the Trust, or the Acquired Fund, or the
Trustees or officers of the Trust II or the Trust, but each
party shall bear the expenses incurred by it incidental to
the preparation and carrying out of this Agreement.
12. AMENDMENTS
This Agreement may be amended, modified or supplemented in such
manner as may be mutually agreed upon by the authorized officers
of the Trust and the Trust II. However, following the meeting of
shareholders of the Acquired Fund held pursuant to Paragraph 5.2
of this Agreement, no such amendment may have the effect of
changing the provisions regarding the method for determining the
number of Acquiring Fund Shares to be received by the Acquired
Fund shareholders under this Agreement to the detriment of such
shareholders without their further approval; provided that
nothing contained in this Article 12 shall be construed to
prohibit the parties from amending this Agreement to change the
Closing Date.
13. NOTICES
Any notice, report, statement or demand required or permitted by
any provisions of this Agreement shall be in writing and shall be
given by prepaid telegraph, telecopy or certified mail addressed
to the Acquiring Fund or to the Acquired Fund, each at 101
Huntington Avenue, Boston, Massachusetts 02199, Attention:
President, and, in either case, with copies to Hale and Dorr LLP,
60 State Street, Boston, Massachusetts 02109, Attention: Pamela
J. Wilson, Esq.
14. HEADINGS; COUNTERPARTS; GOVERNING LAW; ASSIGNMENT
14.1 The article and paragraph headings contained in this
Agreement are for reference purposes only and shall not
affect in any way the meaning or interpretation of this
Agreement.
14.2 This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original.
14.3 This Agreement shall be governed by and construed in
accordance with the laws of The Commonwealth of
Massachusetts.
14.4 This Agreement shall bind and inure to the benefit of the
parties hereto and their respective successors and assigns,
but no assignment or transfer hereof or of any rights or
obligations hereunder shall be made by any party without the
prior written consent of the other party. Nothing herein
expressed or implied is intended or shall be construed to
confer upon or give any person, firm or corporation, other
than the parties hereto and their respective successors and
assigns, any rights or remedies under or by reason of this
Agreement.
14.5 All persons dealing with the Trust or the Trust II must look
solely to the property of the Trust or the Trust II,
respectively, for the enforcement of any claims against the
Trust or the Trust II as the Trustees, officers, agents and
shareholders of the Trust or the Trust II assume no personal
liability for obligations entered into on behalf of the Trust
or the Trust II, respectively. None of the other series of
the Trust or the Trust II shall be responsible for any
obligations assumed by on or behalf of the Acquired Fund or
the Acquiring Fund, respectively, under this Agreement.
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed as of the date first set forth above by
its President or Vice President and has caused its corporate seal
to be affixed hereto.
JOHN HANCOCK STRATEGIC SERIES on behalf of
JOHN HANCOCK STRATEGIC INCOME FUND
By:
_________________________________________
Anne C. Hodsdon
President
JOHN HANCOCK INVESTMENT TRUST III on behalf of
JOHN HANCOCK SHORT-TERM STRATEGIC INCOME FUND
By:
__________________________________________
Susan S. Newton
Vice President and Secretary
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