<PAGE> PAGE 1
000 B000000 02/28/98
000 C000000 0000809991
000 D000000 N
000 E000000 NF
000 F000000 Y
000 G000000 N
000 H000000 N
000 I000000 2.2.a
000 J000000 A
001 A000000 PAINEWEBBER MUNICIPAL SERIES
001 B000000 811-5014
001 C000000 2127131074
002 A000000 1285 AVENUE OF THE AMERICAS
002 B000000 NEW YORK
002 C000000 NY
002 D010000 10019
003 000000 N
004 000000 N
005 000000 N
006 000000 N
007 A000000 Y
007 B000000 2
007 C010100 1
007 C020100 PAINEWEBBER MUNICIPAL HIGH INCOME FUND
007 C030100 N
007 C010200 2
007 C020200 PAINEWEBBER NEW YORK TAX-FREE INCOME FUND
007 C030200 N
007 C010300 3
007 C010400 4
007 C010500 5
007 C010600 6
007 C010700 7
007 C010800 8
007 C010900 9
007 C011000 10
008 A00AA01 MITCHELL HUTCHINS ASSET MANAGEMENT, INC.
008 B00AA01 A
008 C00AA01 801-13219
008 D01AA01 NEW YORK
008 D02AA01 NY
008 D03AA01 10019
008 A00AA02 DELETE
010 A00AA01 MITCHELL HUTCHINS ASSET MANAGEMENT, INC.
010 B00AA01 801-13219
010 C01AA01 NEW YORK
010 C02AA01 NY
010 C03AA01 10019
011 A00AA01 PAINEWEBBER, INC.
011 B00AA01 8-16267
011 C01AA01 NEW YORK
<PAGE> PAGE 2
011 C02AA01 NY
011 C03AA01 10019
012 A00AA01 PFPC INC.
012 B00AA01 84-0000000
012 C01AA01 WILMINGTON
012 C02AA01 DE
012 C03AA01 19809
013 A00AA01 ERNST & YOUNG
013 B01AA01 NEW YORK
013 B02AA01 NY
013 B03AA01 10019
014 A00AA01 PAINEWEBBER INC.
014 B00AA01 8-16267
015 A00AA01 STATE STREET BANK AND TRUST CO.
015 B00AA01 C
015 C01AA01 NORTH QUINCY
015 C02AA01 MA
015 C03AA01 02171
015 E01AA01 X
018 00AA00 Y
019 A00AA00 Y
019 B00AA00 68
019 C00AA00 PAINEWEBBR
020 C000001 0
020 C000002 0
020 C000003 0
020 C000004 0
020 C000005 0
020 C000006 0
020 C000007 0
020 C000008 0
020 C000009 0
020 C000010 0
021 000000 0
022 A000001 SMITH BARNEY INC.
022 B000001 13-1912900
022 C000001 18601
022 D000001 23876
022 A000002 NUVEEN (JOHN) & COMPANY
022 B000002 36-2639476
022 C000002 14764
022 D000002 11645
022 A000003 LEHMAN BROTHERS INC.
022 B000003 13-2518466
022 C000003 11452
022 D000003 9725
022 A000004 PRUDENTIAL SECURITIES INC.
022 B000004 22-2347336
022 C000004 3400
022 D000004 9960
022 A000005 MORGAN STANLEY AND COMPANY
<PAGE> PAGE 3
022 B000005 13-2655998
022 C000005 2981
022 D000005 8297
022 A000006 CITICORP SECURITIES
022 B000006 13-2765182
022 C000006 5600
022 D000006 4000
022 A000007 GOLDMAN SACHS AND COMPANY
022 B000007 13-5108880
022 C000007 7417
022 D000007 1446
022 A000008 MERRILL LYNCH PIERCE FENNER & SMITH
022 B000008 13-5674085
022 C000008 3675
022 D000008 1366
022 A000009 O'CONNOR & AYER INC.
022 B000009 00-0000000
022 C000009 3350
022 D000009 0
022 A000010 EDWARDS (AG) & SONS INC.
022 B000010 43-0875447
022 C000010 0
022 D000010 2748
023 C000000 90564
023 D000000 83855
024 00AA00 N
025 D00AA01 0
025 D00AA02 0
025 D00AA03 0
025 D00AA04 0
025 D00AA05 0
025 D00AA06 0
025 D00AA07 0
025 D00AA08 0
026 A000000 N
026 B000000 N
026 C000000 N
026 D000000 Y
026 E000000 N
026 F000000 N
026 G010000 N
026 G020000 N
026 H000000 Y
027 000000 Y
077 A000000 Y
077 B000000 Y
077 C000000 N
077 D000000 N
077 E000000 N
077 F000000 N
077 G000000 N
<PAGE> PAGE 4
077 H000000 N
077 I000000 N
077 J000000 N
077 K000000 N
077 L000000 N
077 M000000 N
077 N000000 N
077 O000000 Y
077 P000000 N
077 Q010000 Y
077 Q020000 N
077 Q030000 N
078 000000 N
080 A00AA00 ICI MUTUAL INSURANCE CO.
080 C00AA00 45000
081 A00AA00 Y
081 B00AA00 66
082 A00AA00 N
082 B00AA00 0
083 A00AA00 N
083 B00AA00 0
084 A00AA00 N
084 B00AA00 0
085 A00AA00 Y
085 B00AA00 N
086 A010000 0
086 A020000 0
086 B010000 0
086 B020000 0
086 C010000 0
086 C020000 0
086 D010000 0
086 D020000 0
086 E010000 0
086 E020000 0
086 F010000 0
086 F020000 0
028 A010100 5410
028 A020100 184
028 A030100 0
028 A040100 5419
028 B010100 2899
028 B020100 196
028 B030100 0
028 B040100 2035
028 C010100 2628
028 C020100 232
028 C030100 0
028 C040100 3194
028 D010100 4211
028 D020100 187
<PAGE> PAGE 5
028 D030100 0
028 D040100 1728
028 E010100 1676
028 E020100 180
028 E030100 0
028 E040100 1136
028 F010100 1862
028 F020100 227
028 F030100 0
028 F040100 1100
028 G010100 18686
028 G020100 1206
028 G030100 0
028 G040100 14612
028 H000100 4703
029 000100 Y
030 A000100 122
030 B000100 4.00
030 C000100 0.00
031 A000100 79
031 B000100 0
032 000100 0
033 000100 43
034 000100 Y
035 000100 88
036 A000100 N
036 B000100 0
037 000100 N
038 000100 0
039 000100 Y
040 000100 Y
041 000100 Y
042 A000100 0
042 B000100 0
042 C000100 0
042 D000100 0
042 E000100 0
042 F000100 0
042 G000100 0
042 H000100 100
043 000100 462
044 000100 0
045 000100 Y
046 000100 N
047 000100 Y
048 000100 0.600
048 A010100 0
048 A020100 0.000
048 B010100 0
048 B020100 0.000
048 C010100 0
<PAGE> PAGE 6
048 C020100 0.000
048 D010100 0
048 D020100 0.000
048 E010100 0
048 E020100 0.000
048 F010100 0
048 F020100 0.000
048 G010100 0
048 G020100 0.000
048 H010100 0
048 H020100 0.000
048 I010100 0
048 I020100 0.000
048 J010100 0
048 J020100 0.000
048 K010100 0
048 K020100 0.000
049 000100 N
050 000100 N
051 000100 N
052 000100 N
053 A000100 N
054 A000100 Y
054 B000100 Y
054 C000100 N
054 D000100 N
054 E000100 N
054 F000100 N
054 G000100 Y
054 H000100 Y
054 I000100 N
054 J000100 Y
054 K000100 N
054 L000100 N
054 M000100 Y
054 N000100 N
054 O000100 N
055 A000100 N
055 B000100 N
056 000100 N
057 000100 N
058 A000100 N
059 000100 Y
060 A000100 N
060 B000100 N
061 000100 1000
062 A000100 Y
062 B000100 0.0
062 C000100 0.0
062 D000100 0.0
062 E000100 1.9
<PAGE> PAGE 7
062 F000100 0.0
062 G000100 0.0
062 H000100 0.0
062 I000100 0.0
062 J000100 0.0
062 K000100 0.0
062 L000100 0.0
062 M000100 0.0
062 N000100 0.0
062 O000100 102.3
062 P000100 0.0
062 Q000100 0.0
062 R000100 0.0
063 A000100 0
063 B000100 19.2
064 A000100 N
064 B000100 N
066 A000100 N
067 000100 N
068 A000100 N
068 B000100 N
069 000100 N
070 A010100 Y
070 A020100 N
070 B010100 N
070 B020100 N
070 C010100 Y
070 C020100 N
070 D010100 N
070 D020100 N
070 E010100 Y
070 E020100 Y
070 F010100 N
070 F020100 N
070 G010100 Y
070 G020100 N
070 H010100 N
070 H020100 N
070 I010100 N
070 I020100 N
070 J010100 Y
070 J020100 N
070 K010100 Y
070 K020100 N
070 L010100 N
070 L020100 N
070 M010100 N
070 M020100 N
070 N010100 Y
070 N020100 N
070 O010100 Y
<PAGE> PAGE 8
070 O020100 N
070 P010100 Y
070 P020100 N
070 Q010100 Y
070 Q020100 N
070 R010100 Y
070 R020100 N
071 A000100 28797
071 B000100 19542
071 C000100 89203
071 D000100 22
072 A000100 12
072 B000100 5850
072 C000100 0
072 D000100 0
072 E000100 0
072 F000100 551
072 G000100 0
072 H000100 0
072 I000100 62
072 J000100 52
072 K000100 24
072 L000100 27
072 M000100 10
072 N000100 57
072 O000100 0
072 P000100 0
072 Q000100 0
072 R000100 42
072 S000100 46
072 T000100 462
072 U000100 0
072 V000100 0
072 W000100 21
072 X000100 1354
072 Y000100 0
072 Z000100 4496
072AA000100 1065
072BB000100 0
072CC010100 3837
072CC020100 0
072DD010100 2812
072DD020100 1684
072EE000100 0
073 A010100 0.0000
073 A020100 0.0000
073 B000100 0.0000
073 C000100 0.0000
074 A000100 25
074 B000100 0
074 C000100 1900
<PAGE> PAGE 9
074 D000100 101710
074 E000100 0
074 F000100 0
074 G000100 0
074 H000100 0
074 I000100 0
074 J000100 0
074 K000100 0
074 L000100 1917
074 M000100 87
074 N000100 105639
074 O000100 5475
074 P000100 83
074 Q000100 0
074 R010100 0
074 R020100 0
074 R030100 0
074 R040100 657
074 S000100 0
074 T000100 99424
074 U010100 5408
074 U020100 3662
074 V010100 0.00
074 V020100 0.00
074 W000100 0.0000
074 X000100 3039
074 Y000100 0
075 A000100 0
075 B000100 91851
076 000100 0.00
028 A010200 308
028 A020200 93
028 A030200 0
028 A040200 835
028 B010200 453
028 B020200 98
028 B030200 0
028 B040200 789
028 C010200 447
028 C020200 114
028 C030200 0
028 C040200 760
028 D010200 190
028 D020200 95
028 D030200 0
028 D040200 896
028 E010200 509
028 E020200 90
028 E030200 0
028 E040200 975
028 F010200 1620
<PAGE> PAGE 10
028 F020200 113
028 F030200 0
028 F040200 604
028 G010200 3527
028 G020200 603
028 G030200 0
028 G040200 4859
028 H000200 1721
029 000200 Y
030 A000200 48
030 B000200 4.00
030 C000200 0.00
031 A000200 31
031 B000200 0
032 000200 0
033 000200 17
034 000200 Y
035 000200 26
036 A000200 N
036 B000200 0
037 000200 N
038 000200 0
039 000200 Y
040 000200 Y
041 000200 Y
042 A000200 0
042 B000200 0
042 C000200 0
042 D000200 0
042 E000200 0
042 F000200 0
042 G000200 0
042 H000200 100
043 000200 240
044 000200 0
045 000200 Y
046 000200 N
047 000200 Y
048 000200 0.600
048 A010200 0
048 A020200 0.000
048 B010200 0
048 B020200 0.000
048 C010200 0
048 C020200 0.000
048 D010200 0
048 D020200 0.000
048 E010200 0
048 E020200 0.000
048 F010200 0
048 F020200 0.000
<PAGE> PAGE 11
048 G010200 0
048 G020200 0.000
048 H010200 0
048 H020200 0.000
048 I010200 0
048 I020200 0.000
048 J010200 0
048 J020200 0.000
048 K010200 0
048 K020200 0.000
049 000200 N
050 000200 N
051 000200 N
052 000200 N
053 A000200 Y
053 B000200 Y
053 C000200 N
054 A000200 Y
054 B000200 Y
054 C000200 N
054 D000200 N
054 E000200 N
054 F000200 N
054 G000200 Y
054 H000200 Y
054 I000200 N
054 J000200 Y
054 K000200 N
054 L000200 N
054 M000200 Y
054 N000200 N
054 O000200 N
055 A000200 N
055 B000200 N
056 000200 Y
057 000200 N
058 A000200 N
059 000200 Y
060 A000200 N
060 B000200 N
061 000200 1000
062 A000200 Y
062 B000200 0.0
062 C000200 0.0
062 D000200 0.0
062 E000200 2.7
062 F000200 0.0
062 G000200 0.0
062 H000200 0.0
062 I000200 0.0
062 J000200 0.0
<PAGE> PAGE 12
062 K000200 0.0
062 L000200 0.0
062 M000200 0.0
062 N000200 0.0
062 O000200 96.2
062 P000200 0.0
062 Q000200 0.0
062 R000200 0.0
063 A000200 0
063 B000200 20.6
064 A000200 Y
064 B000200 N
066 A000200 N
067 000200 N
068 A000200 N
068 B000200 N
069 000200 N
070 A010200 Y
070 A020200 N
070 B010200 N
070 B020200 N
070 C010200 Y
070 C020200 N
070 D010200 N
070 D020200 N
070 E010200 Y
070 E020200 Y
070 F010200 N
070 F020200 N
070 G010200 Y
070 G020200 N
070 H010200 N
070 H020200 N
070 I010200 N
070 I020200 N
070 J010200 Y
070 J020200 N
070 K010200 Y
070 K020200 N
070 L010200 N
070 L020200 N
070 M010200 N
070 M020200 N
070 N010200 Y
070 N020200 N
070 O010200 Y
070 O020200 N
070 P010200 Y
070 P020200 N
070 Q010200 Y
070 Q020200 N
<PAGE> PAGE 13
070 R010200 Y
070 R020200 N
071 A000200 14872
071 B000200 19318
071 C000200 43494
071 D000200 34
072 A000200 12
072 B000200 2542
072 C000200 0
072 D000200 0
072 E000200 0
072 F000200 265
072 G000200 0
072 H000200 0
072 I000200 22
072 J000200 20
072 K000200 10
072 L000200 15
072 M000200 10
072 N000200 45
072 O000200 0
072 P000200 0
072 Q000200 0
072 R000200 35
072 S000200 24
072 T000200 240
072 U000200 0
072 V000200 0
072 W000200 11
072 X000200 697
072 Y000200 118
072 Z000200 1963
072AA000200 840
072BB000200 0
072CC010200 1014
072CC020200 0
072DD010200 1065
072DD020200 898
072EE000200 0
073 A010200 0.0000
073 A020200 0.0000
073 B000200 0.0000
073 C000200 0.0000
074 A000200 93
074 B000200 0
074 C000200 1200
074 D000200 42806
074 E000200 0
074 F000200 0
074 G000200 0
074 H000200 0
<PAGE> PAGE 14
074 I000200 0
074 J000200 0
074 K000200 0
074 L000200 694
074 M000200 37
074 N000200 44830
074 O000200 0
074 P000200 35
074 Q000200 0
074 R010200 0
074 R020200 0
074 R030200 0
074 R040200 306
074 S000200 0
074 T000200 44489
074 U010200 2130
074 U020200 1870
074 V010200 0.00
074 V020200 0.00
074 W000200 0.0000
074 X000200 1499
074 Y000200 0
075 A000200 0
075 B000200 44126
076 000200 0.00
SIGNATURE PAUL SCHUBERT
TITLE TREASURER
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000809991
<NAME> PAINEWEBBER MUNICIPAL SERIES
<SERIES>
<NUMBER> 1
<NAME> MUNICIPAL HIGH INCOME FUND CLASS A
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> FEB-28-1998
<PERIOD-START> MAR-01-1997
<PERIOD-END> FEB-28-1998
<INVESTMENTS-AT-COST> 57961
<INVESTMENTS-AT-VALUE> 61785
<RECEIVABLES> 1143
<ASSETS-OTHER> 52
<OTHER-ITEMS-ASSETS> 15
<TOTAL-ASSETS> 62995
<PAYABLE-FOR-SECURITIES> 3265
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 441
<TOTAL-LIABILITIES> 3706
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 55845
<SHARES-COMMON-STOCK> 5408
<SHARES-COMMON-PRIOR> 5061
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (380)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 3824
<NET-ASSETS> 59289
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 3478
<OTHER-INCOME> 0
<EXPENSES-NET> (666)
<NET-INVESTMENT-INCOME> 2812
<REALIZED-GAINS-CURRENT> 635
<APPREC-INCREASE-CURRENT> 2288
<NET-CHANGE-FROM-OPS> 5735
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (2812)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 20357
<NUMBER-OF-SHARES-REDEEMED> (20939)
<SHARES-REINVESTED> 1507
<NET-CHANGE-IN-ASSETS> 3848
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (634)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 328
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 666
<AVERAGE-NET-ASSETS> 54582
<PER-SHARE-NAV-BEGIN> 10.39
<PER-SHARE-NII> .55
<PER-SHARE-GAIN-APPREC> .57
<PER-SHARE-DIVIDEND> (.55)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.96
<EXPENSE-RATIO> 1.22
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000809991
<NAME> PAINEWEBBER MUNICIPAL SERIES
<SERIES>
<NUMBER> 1
<NAME> MUNICIPAL HIGH INCOME CLASS B
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> FEB-28-1998
<PERIOD-START> MAR-01-1997
<PERIOD-END> FEB-28-1998
<INVESTMENTS-AT-COST> 17692
<INVESTMENTS-AT-VALUE> 18859
<RECEIVABLES> 349
<ASSETS-OTHER> 16
<OTHER-ITEMS-ASSETS> 5
<TOTAL-ASSETS> 19229
<PAYABLE-FOR-SECURITIES> 997
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 135
<TOTAL-LIABILITIES> 1132
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 17046
<SHARES-COMMON-STOCK> 1651
<SHARES-COMMON-PRIOR> 1870
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (116)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 1167
<NET-ASSETS> 18097
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 1169
<OTHER-INCOME> 0
<EXPENSES-NET> (363)
<NET-INVESTMENT-INCOME> 806
<REALIZED-GAINS-CURRENT> 194
<APPREC-INCREASE-CURRENT> 698
<NET-CHANGE-FROM-OPS> 1698
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (806)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 5442
<NUMBER-OF-SHARES-REDEEMED> (5255)
<SHARES-REINVESTED> 368
<NET-CHANGE-IN-ASSETS> 1447
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (234)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 110
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 363
<AVERAGE-NET-ASSETS> 18355
<PER-SHARE-NAV-BEGIN> 10.39
<PER-SHARE-NII> .47
<PER-SHARE-GAIN-APPREC> .57
<PER-SHARE-DIVIDEND> (.47)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.96
<EXPENSE-RATIO> 1.98
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000809991
<NAME> PAINEWEBBER MUNICIPAL SERIES
<SERIES>
<NUMBER> 1
<NAME> MUNICIPAL HIGH INCOME CLASS C
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> FEB-28-1998
<PERIOD-START> MAR-01-1997
<PERIOD-END> FEB-28-1998
<INVESTMENTS-AT-COST> 21490
<INVESTMENTS-AT-VALUE> 22907
<RECEIVABLES> 424
<ASSETS-OTHER> 19
<OTHER-ITEMS-ASSETS> 6
<TOTAL-ASSETS> 23356
<PAYABLE-FOR-SECURITIES> 1211
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 164
<TOTAL-LIABILITIES> 1375
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 20705
<SHARES-COMMON-STOCK> 2006
<SHARES-COMMON-PRIOR> 1633
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (141)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 1417
<NET-ASSETS> 21981
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 1203
<OTHER-INCOME> 0
<EXPENSES-NET> (325)
<NET-INVESTMENT-INCOME> 878
<REALIZED-GAINS-CURRENT> 235
<APPREC-INCREASE-CURRENT> 848
<NET-CHANGE-FROM-OPS> 1961
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (878)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 10425
<NUMBER-OF-SHARES-REDEEMED> (6957)
<SHARES-REINVESTED> 532
<NET-CHANGE-IN-ASSETS> (5083)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (204)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 113
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 325
<AVERAGE-NET-ASSETS> 18910
<PER-SHARE-NAV-BEGIN> 10.39
<PER-SHARE-NII> 0.50
<PER-SHARE-GAIN-APPREC> 0.57
<PER-SHARE-DIVIDEND> (0.50)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.96
<EXPENSE-RATIO> 1.72
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000809991
<NAME> PAINEWEBBER MUNICIPAL SERIES
<SERIES>
<NUMBER> 1
<NAME> MUNICIPAL HIGH INCOME CLASS Y
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> FEB-28-1998
<PERIOD-START> MAR-01-1997
<PERIOD-END> FEB-28-1998
<INVESTMENTS-AT-COST> 55
<INVESTMENTS-AT-VALUE> 59
<RECEIVABLES> 1
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 60
<PAYABLE-FOR-SECURITIES> 3
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 0
<TOTAL-LIABILITIES> 3
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 53
<SHARES-COMMON-STOCK> 5
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 4
<NET-ASSETS> 57
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> 0
<NET-INVESTMENT-INCOME> 0
<REALIZED-GAINS-CURRENT> 1
<APPREC-INCREASE-CURRENT> 2
<NET-CHANGE-FROM-OPS> 3
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 56
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 59
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 4
<PER-SHARE-NAV-BEGIN> 10.98
<PER-SHARE-NII> 0.04
<PER-SHARE-GAIN-APPREC> (0.01)
<PER-SHARE-DIVIDEND> (0.04)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.97
<EXPENSE-RATIO> 1.00
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000809991
<NAME> PAINEWEBBER MUNICIPAL SERIES
<SERIES>
<NUMBER> 2
<NAME> PAINEWEBBER NEW YORK TAX-FREE INCOME FUND CLASS A
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> FEB-28-1998
<PERIOD-START> MAR-01-1997
<PERIOD-END> FEB-28-1998
<INVESTMENTS-AT-COST> 21783
<INVESTMENTS-AT-VALUE> 23437
<RECEIVABLES> 369
<ASSETS-OTHER> 21
<OTHER-ITEMS-ASSETS> 49
<TOTAL-ASSETS> 23876
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 181
<TOTAL-LIABILITIES> 181
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 22086
<SHARES-COMMON-STOCK> 2130
<SHARES-COMMON-PRIOR> 2,174
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (38)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 1646
<NET-ASSETS> 23695
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 1294
<OTHER-INCOME> 0
<EXPENSES-NET> (229)
<NET-INVESTMENT-INCOME> 1065
<REALIZED-GAINS-CURRENT> 448
<APPREC-INCREASE-CURRENT> 540
<NET-CHANGE-FROM-OPS> 2053
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (1065)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 2969
<NUMBER-OF-SHARES-REDEEMED> (5808)
<SHARES-REINVESTED> 686
<NET-CHANGE-IN-ASSETS> (1,166)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (455)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 135
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 229
<AVERAGE-NET-ASSETS> 22449
<PER-SHARE-NAV-BEGIN> 10.66
<PER-SHARE-NII> 0.51
<PER-SHARE-GAIN-APPREC> 0.46
<PER-SHARE-DIVIDEND> (0.51)
<PER-SHARE-DISTRIBUTIONS> 0.00
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 11.12
<EXPENSE-RATIO> 1.02
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000809991
<NAME> PAINEWEBBER MUNICIPAL SERIES
<SERIES>
<NUMBER> 2
<NAME> PAINEWEBBER NEW YORK TAX-FREE INCOME FUND CLASS B
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> FEB-28-1998
<PERIOD-START> MAR-01-1997
<PERIOD-END> FEB-28-1998
<INVESTMENTS-AT-COST> 7198
<INVESTMENTS-AT-VALUE> 7744
<RECEIVABLES> 122
<ASSETS-OTHER> 7
<OTHER-ITEMS-ASSETS> 16
<TOTAL-ASSETS> 7889
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 60
<TOTAL-LIABILITIES> 60
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 7298
<SHARES-COMMON-STOCK> 704
<SHARES-COMMON-PRIOR> 888
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (12)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 544
<NET-ASSETS> 7829
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 492
<OTHER-INCOME> 0
<EXPENSES-NET> (151)
<NET-INVESTMENT-INCOME> 341
<REALIZED-GAINS-CURRENT> 148
<APPREC-INCREASE-CURRENT> 178
<NET-CHANGE-FROM-OPS> 667
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (341)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1401
<NUMBER-OF-SHARES-REDEEMED> (1,802)
<SHARES-REINVESTED> 162
<NET-CHANGE-IN-ASSETS> 87
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (186)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 51
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 151
<AVERAGE-NET-ASSETS> 8549
<PER-SHARE-NAV-BEGIN> 10.65
<PER-SHARE-NII> 0.43
<PER-SHARE-GAIN-APPREC> 0.47
<PER-SHARE-DIVIDEND> (0.43)
<PER-SHARE-DISTRIBUTIONS> 0.00
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 11.12
<EXPENSE-RATIO> 1.77
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
^WPC^^^^^^K@+<69^^<^^^^|^^(^X@Bo!^^^^N^'^:_o[:^^^^^.^^^}^^{^^^}^^Tb^^v^J!g^^^^*^^~^^^^^,'+^^^g^D^^^Mx_^t^^^2V)^^
</TABLE>
Report of Independent Auditors
To the Shareholders and Board of Trustees of
PaineWebber Municipal Series
In planning and performing our audit of the financial
statements of PaineWebber Municipal Series (comprising,
respectively, PaineWebber Municipal High Income
Fund and PaineWebber New York Tax-Free Income Fund)
for the year ended February 28, 1998, we considered
its internal control, including control
activities for safeguarding securities, in
order to determine our auditing procedures for
the purpose of expressing our opinion on the financial
statements and to comply with the requirements of
Form N-SAR, not to provide assurance on the internal
control.
The management of PaineWebber Municipal Series is
responsible for establishing and maintaining internal
control. In fulfilling this responsibility,
estimates and judgments by management are required
to assess the expected benefits and related costs of
controls. Generally, controls that are relevant
to an audit pertain to the entity's objective of
preparing financial statements for external purposes
that are fairly presented in conformity with
generally accepted accounting principles. Those
controls include the safeguarding of assets against
unauthorized acquisition, use or disposition.
Because of inherent limitations in internal control,
errors or fraud may occur and not be detected.
Also, projection of any evaluation of internal control
to future periods is subject to the risk that it
may become inadequate because of changes in conditions
or that the effectiveness of the design and operation
may deteriorate.
Our consideration of the internal control would not
necessarily disclose all matters in the internal
control that might be material weaknesses under
standards established by the American Institute of
Certified Public Accountants. A material weakness is a
condition in which the design or operation of one or
more of the internal control components does not reduce to
a relatively low level the risk that errors or fraud
in amounts that would be material in relation to the
financial statements being audited may occur and
not be detected within a timely period by employees
in the normal course of performing their assigned fuctions.
However, we noted no matters involving the internal control
and its operation, including controls for safeguarding
securities, that we consider to be material weaknesses
as defined above at February 28, 1998.
This report is intended solely for the information and
use of the shareholders, board of trustees and management
of PaineWebber Municipal Series and the Securities and
Exchange Commission.
ERNST & YOUNG LLP
April 15, 1998
/
For period ending February 28, 1998
File number 811-5014
77. A. Is the Registrant filing any of the following
attachments with the current filing of Form
N-SAR?(ANSWER FOR ALL SERIES AS A GROUP)______ __
Y/N
NOTE: If answer is Y (Yes), mark those items below being
filed as an attachment to this form or incorporated
by reference. __
Y/N
B. Accountant s report on internal control ___
C. Matters submitted to a vote of security holders N
D. Policies with respect to security investments N
E. Legal proceedings N
F. Changes in security for debt N
G. Defaults and arrears on senior securities N
H. Changes in control of Registrant N
I. Terms of new or amended securities N
J. Revaluation of assets or restatement of
capital share account N
K. Changes in Registrant s certifying accountant N
L. Changes in accounting principles and practices N
M. Mergers N
N. Actions required to be reported pursuant
to Rule 2a-7 N
O. Transactions effected pursuant to Rule 10f-3 Y
P. Information required to be filed
pursuant to existing exemptive orders N
Attachment Information (Cont. On Screen 39)
For period ending February 28, 1998
File number 811-5014
Attachment Information (Cont. from Screen 38)
77. Q. 1. Exhibits Y
Y/N
2. Any information called for by
instructions to sub-item 77Q2 N
Y/N
3. Any information called for by
instructions to sub-item 77Q3 N
Y/N
SCREEN NUMBER: 39
__ __ __ __ __ __ __ __ __ __ __ __ __ __ __ __ __ __ __ __
79. List the 811 numbers and names of Registrant's
wholly-owned investment company subsidiaries
consolidated in this report.
811 Number Subsidiary Name
For period ending February 28, 1998
File number 811-5014
ANNUAL SUPPLEMENT
Page 53 is to be filed only once each year at
the end of Registrant s fiscal year.
105. Fidelity bond(s) in effect at the end of the period:
A. Insurer Name: ICI Mutual Insurance Co.
B. Second Insurer:
C. Aggregate face amount of coverage for
Registrant on all bonds on which
it is named as an insured
($000 s omitted) $45,000
106. A. Is the bond part of a joint fidelity
bond(s) shared with other investment
companies or other entities? Y
Y/N
B. If the answer to 106A is Y (Yes),
how many other investment companies
or other entities are covered by the
bond? 66
NOTE: Count each series as a separate
investment company.
107. A. Does the mandatory coverage of the
fidelity bond have a deductible? N
Y/N
B. If the answer to 107A is Y (Yes),
what is the amount of the deductible? $______
108. A. Were any claims with respect to
this Registrant filed under the
bond during the period? N
Y/N
B. If the answer to 108A is Y
(Yes), what was the total amount of
such claim(s)? $______
109. A. Were any losses incurred with
respect to this Registrant that
could have been filed as a claim
under the fidelity bond but were
not? N
Y/N
B. If the answer to sub-item 109A
is Y (Yes), what was the total
amount of such losses? ($000 somitted) $______
110. A. Are Registrant s officers and directors
covered as officers and directors of
Registrant under any errors and omissions
insurance policy owned by the Registrant
or anyone else? Y
Y/N
B. Were any claims filed under such policy
during the period with respect to
Registrant? N
Y/N
<PAGE>
For period ending February 28, 1998
Exhibit 77(Q)(1)
File number 811-5014
PAINEWEBBER MUNICIPAL SERIES
AMENDED AND RESTATED DECLARATION OF TRUST
DECLARATION OF TRUST, made at Boston, Massachusetts,
this 28th day of January 1987 and amended and restated
this 19th day of November, 1997 by the Trustees:
WHEREAS, the Trustees desire to establish a
trust fund for the investment and
reinvestment of funds contributed thereto;
NOW, THEREFORE, the Trustees declare that all
money and property contributed
to the trust fund hereunder shall be
held and managed in trust under this Declaration of Trust
as herein set forth below.
ARTICLE I
NAME AND DEFINITIONS
NAME
Section 1. This Trust shall be known as "PaineWebber
Municipal Series. Theresident agent for the Trust
in Massachusetts shall be CT Corporation System, whose
address is 2 Oliver Street, Boston, Massachusetts, or
such other person as the Trustees may from time
to time designate.
DEFINITIONS
Section 2. Wherever used herein, unless otherwise
required by the context or specifically provided:
(a) The Terms "Affiliated Person", "Assignment",
"Commission", "Interested Person", "Majority Shareholder
Vote" (the 67% or 50% requirement of the third sentence of
Section 2(a)(42) of the 1940 Act, whichever may be applicable)
and "Principal Underwriter" shall have the meanings
given them in the 1940 Act, as amended from time to time;
(b) The "Trust" refers to PaineWebber Municipal Series
and reference to the Trust, when applicable to one or m
ore Series of the Trust, shall refer to any such Series;
(c) "Net Asset Value" means the net asset value of each
Series of the Trust determined in the manner provided in
Article IX, Section 3;
(d) "Shareholder" means a record owner of Shares of the
Trust;
(e) The "Trustees" means the person who has signed
this Declaration of Trust so long as he shall continue
in office in accordance with the terms hereof, and all
other persons who may from time to time be duly elected
or appointed, qualified and serving as Trustees in
accordance with the provisions of Article IV hereof, and
reference herein to a Trustee or the Trustees shall refer
to such person or persons in his capacity or their
capacities as trustees hereunder.
(f) "Shares" means the equal proportionate transferable
units of interest into which the beneficial interest of
each Series or Class thereof shall be divided from time
to time and includes fractions of shares as well as
whole shares (all of the transferable units of a Series
or of a single Class may be referred to as "Shares"
as the context may require);
(g) The "1940 Act" refers to the Investment Company
Act of 1940, as amended from time to time;
(h) "Series" refers to series of Shares of the Trust
established in accordance with the provisions of
Article III;
(i) "Class" refers to the class of Shares of a Series
of the Trust established in accordance with the Provisions
of Article III.
ARTICLE II
PURPOSE OF TRUST
The purpose of this Trust is to provide investors a
continuous source of managed investment in securities.
ARTICLE III
BENEFICIAL INTEREST
SHARES OF BENEFICIAL INTEREST
Section 1. The beneficial interest in the Trust shall
be divided into such transferable Shares of one or more
separate and distinct Series or Classes thereof as the
Tustees shall from time to time create and establish.
The number of Shares is unlimited and each Share shall
have a par value of $0.001 per Share and upon issuance
in accordance with the terms hereof shall be fully paid
and nonassessable. The Trustees shall have full power
and authority, in their sole discretion and without
obtaining any prior authorization or vote of the
Shareholders of the Trust, to create and establish
(and to change in any manner) Shares with such preferences,
terms of conversion, voting powers, rights and privileges
as the Trustees may from time to time determine, to divide
or combine the Shares into a greater or lesser number, to
classify or reclassify any unissued Shares into one or
more Series or Classes of Shares, to abolish any one
or more Series or Classes of Shares, and to take such
other action with respect to the Shares as the Trustees
may deem desirable. The Trustees, in their discretion
without a vote of the Shareholders, may divide the Shares
of any Series into Classes. In such event, each Class of
a Series shall represent interests in the assets of that
Series and have identical voting, dividend, liquidation
and other rights and the same terms and conditions,
except that expenses allocated to a Class of a Series
may be borne solely by such Class as shall be determined
by the Trustees and a Class of a Series may have exclusive
voting rights with respect to matters affecting only that
Class. Without limiting the authority of the Trustees set
forth in this Section 1 to establish and designate any
further Series or Classes, the Trustees have established
and designated the Series of Shares and Classes listed
in Schedule A attached hereto and made a part hereof.
ESTABLISHMENT OF SERIES OR CLASS
Section 2. The establishment of any Series or Class
in addition to those set forth in Section 1 shall be
effective upon the adoption of a resolution by a majority
of the then Trustees setting forth such establishment and
designation and the relative rights and preferences of the
Shares of such Series or Class thereof. At any time that
there are no Shares outstanding of any particular Series
previously established and designated, the Trustees may
by a majority vote abolish that Series and the
establishment and designation thereof. At any time that
there are no shares outstanding of any particular Class
of a Series, the Trustees may by a majority vote abolish
that Class and the establishment and designation thereof.
The Trustees by a majority vote may change the name of
any Series or Class.
OWNERSHIP OF SHARES
Section 3. The ownership of Shares shall be recorded in
the books of the Trust. The Trustees may make such rules
as they consider appropriate for the transfer of Shares
and similar matters. The record books of the Trust shall
be conclusive as to who are the holders of Shares and as
to the number of Shares held from time to time by each
Shareholder.
INVESTMENT IN THE TRUST
Section 4. The Trustees shall accept investments in the
Trust from such persons and on such terms as they may from
time to time authorize. Such investments may be in the form
of cash or securities in which the appropriate Series is
authorized to invest, valued as provided in Article IX,
Section 3. After the date of the initial contribution of
capital, the number of Shares to represent the initial
contribution may in the Trustees' discretion be considered
as outstanding and the amount received by the Trustees on
account of the contribution shall be treated as an asset
of the Trust or a Series thereof, as appropriate.
Subsequent investments in the Trust shall be credited to
each Shareholder's account in the form of full Shares at
the Net Asset Value per Share next determined after the
investment is received; provided, however, that the
Trustees may, in their sole discretion, (a) impose a sales
charge upon investments in the Trust or Series and (b)
issue fractional Shares. The Trustees shall have the
right to refuse to accept investments in the Trust or
any Series at any time without any cause or reason therefor
whatsoever.
ASSETS AND LIABILITIES OF SERIES
Section 5. All consideration received by the Trust for
the issue or sale of Shares of a particular Series,
together with all assets in which such consideration is
invested or reinvested, all income, earnings, profits,
and proceeds thereof, including any proceeds derived from
the sale, exchange or liquidation of such assets, and
any funds or payments derived from any reinvestment of
such proceeds in whatever form the same may be, shall be
referred to as "assets belonging to" that Series. In
addition, any assets, income, earnings, profits, and
proceeds thereof, funds, or payments which are not
readily identifiable as belonging to any particular
Series shall be allocated by the Trustees between and
among one or more of the Series in such manner as they,
in their sole discretion, deem fair and equitable.
Each such allocation shall be conclusive and binding
upon the Shareholders of all Series for all purposes,
and shall be referred to as assets belonging to that
Series. The assets belonging to a particular Series
shall be so recorded upon the books of the Trust, and
shall be held by the Trustees in Trust for the
benefit of the holders of Shares of that Series.
The assets belonging to each particular Series
shall be charged with the liabilities of that Series
and all expenses, costs, charges and reserves attributable
to that Series except that liabilities and expenses
allocated solely to a particular Class shall be borne
by that Class. Any general liabilities, expenses, costs,
charges or reserves of the Trust or Series which are not
readily identifiable as belonging to any particular Series
or Class shall be allocated and charged by the Trustees
between or among any one or more of the
Series or Classes in such manner as the Trustees in their
sole discretion deem fair and equitable.
Each such allocation shall be conclusive and binding
upon the Shareholders of all Series or
Classes for all purposes. Any creditor of
any Series may look only to the assets of that Series
to satisfy such creditor's debt. See Article X, Section 1.
NO PREEMPTIVE RIGHTS
Section 6. Shareholders shall have no preemptive or
other right to subscribe to any additional Shares or other
securities issued by the Trust or the Trustees.
STATUS OF SHARES AND LIMITATION OF PERSONAL LIABILITY
Section 7. Shares shall be deemed to be personal
property giving only the rights provided in this Declaration
of Trust. Every Shareholder by virtue of having become a
Shareholder shall be held expressly to have assented and
agreed to the terms of this Declaration
of Trust and to have become a party hereto.
The death of a Shareholder during the continuance
of the Trust shall not operate to terminate the
Trust nor entitle the representative of any deceased
Shareholder to an accounting or to take any action in
court or elsewhere against the Trust or the
Trustees, but only to the rights of said decedent
under this Trust. Ownership of Shares shall not
entitle the Shareholder to any title in or to the
whole or any part of the Trust property or right
to call for a partition or division of the same
or for an accounting, nor shall the ownership of
Shares constitute the Shareholders partners.
Neither the Trust nor the Trustees shall have any
power to bind any Shareholder personally or to
call upon any Shareholder for the payment of
any sum of money or assessment whatsoever other
than such as the Shareholder may at any time
personally agree to pay by way of subscription
for any Shares or otherwise.
ARTICLE IV
THE TRUSTEES
MANAGEMENT OF THE TRUST
Section 1. The business and affairs of the Trust
shall be managed by the Trustees, and they shall have
all powers necessary and desirable to carry out that
responsibility. A Trustee shall not be required to
be a Shareholder of the Trust.
ELECTION OF TRUSTEES AND APPOINTMENT OF INITIAL TRUSTEE
Section 2. On a date fixed by the Trustees, the
Shareholders shall elect the Trustees. Until such election,
the Trustees shall be the initial Trustee and such other
persons as may be hereafter appointed pursuant to
Section 4 of this Article IV. The initial Trustee shall
be Dianne E. O Donnell.
TERM OF OFFICE OF TRUSTEES
Section 3. The Trustees shall hold office during
the lifetime of this Trust, and until its termination
as hereinafter provided; except (a) that any Trustee may
resign his trust by written instrument signed by him
and delivered to the other Trustees or to any officer
of the Trust, which shall take effect upon such delivery
or upon such later date as is specified therein; (b) that any
Trustee may be removed with or without cause at any time by
written instrument, signed by at least two-thirds of the
number of Trustees prior to such removal, specifying the
date when such removal shall become effective; (c) that any
Trustee who requests in writing to be retired or who
has become incapacitated by illness or injury may be
retired by written instrument signed by a
majority of other Trustees, specifying the date of his
retirement; and (d) that any Trustee may
be removed at any Special Meeting of the Trust by a
vote of at least two-thirds of the outstanding Shares.
RESIGNATION AND APPOINTMENT OF TRUSTEES
Section 4. In case of the declination, death,
resignation, retirement, removal,incapacity, or inability
of any of the Trustees, or in case a vacancy shall exist
by reason of an increase in number or for any other reason,
the remaining Trustees shall fill such vacancy by
appointment of such other person as they in their
discretion shall see fit consistent with the
limitations under the 1940 Act. Such appointment
shall be evidenced by a written instrument
signed by a majority of the Trustees in office
or by a recording in the records of the Trust,
whereupon the appointment shall take effect.
An appointment of a Trustee may be made by the
Trustees then in office as aforesaid in anticipation
of a vacancy to occur by reason of retirement,
resignation or increase in number of Trustees
effective at a later date, provided that said
appointment shall become effective only at or
after the effective date of said retirement,
resignation or increase in number of Trustees.
As soon as any Trustee so appointed shall have
accepted this trust, the trust estate shall vest
in the new Trustee or Trustees, together with the
continuing Trustees, without any further act or
conveyance, and he shall be deemed a Trustee
hereunder. The power of appointment is subject to the
provisions of Section 16(a) of the 1940
Act.
TEMPORARY ABSENCE OF TRUSTEE
Section 5. Any Trustee may, by power of attorney,
delegate his power for a period not exceeding six months
at any one time to any other Trustee or Trustees, provided
that in no case shall less than two Trustees personally
exercise the other powers hereunder except as herein
otherwise expressly provided.
NUMBER OF TRUSTEES
Section 6. The number of Trustees shall initially
be one (1) and thereafter shall be such number as shall
be fixed from time to time by a written instrument signed
by a majority of the Trustees (or by an officer of the
Trust pursuant to a vote of the majority of such Trustees);
provided, however, that the number of Trustees serving
hereunder at any time shall in no event be less than
one (1) nor more than fifteen (15).
Whenever a vacancy in the Board of Trustees shall
occur, until such vacancy is filled, or while
any Trustee is absent from his state of domicile
(unless said Trustee has made arrangements to be informed
about, and to participate in, the affairs of the Trust
during such absence), or is physically or mentally
incapacitated by reason of disease or otherwise, the other
Trustees shall have all the powers hereunder and the
certificate of the other Trustees of such
vacancy, absence or incapacity, shall be conclusive.
EFFECT OF DEATH, RESIGNATION, ETC. OF A TRUSTEE
Section 7. The death, declination, resignation,
retirement, removal, incapacity, or inability of the
Trustee, or any one of them, shall not operate to annul
the Trust or to revoke any existing agency created
pursuant to the terms of this Declaration of Trust.
OWNERSHIP OF ASSETS OF THE TRUST
Section 8. The assets of the Trust shall be held
separate and apart from any assets now or hereafter held
in any capacity other than as Trustee hereunder by the
Trustees or any successor Trustees. All of the assets of
the Trust shall at all times be considered as vested in
the Trustees.
ARTICLE V
POWERS OF THE TRUSTEES
POWERS
Section 1. The Trustees in all instances shall act as
principals, and are and shall be free from the control of the
Shareholders. The Trustees shall have full power and
authority to do any and all acts and to make and execute
any and all contracts and instruments that they may
consider necessary or appropriate in connection with
the management of the Trust. The Trustees shall not
in any way be bound or limited by present or future laws
or customs in regard to trust investments, but shall have
full authority and power to make any and all investments
which they, in their uncontrolled discretion, shall deem
proper to accomplish the purposes of
this Trust. Subject to any applicable
limitation in this Declaration of Trust or the By-Laws of
the Trust, the Trustees shall have power and authority,
without limitation:
(a) To invest and reinvest cash and other property,
and to hold cash or other property uninvested, without in
any event being bound or limited by any present or future law
or custom in regard to investments by trustees, and to sell,
exchange, lend, pledge, mortgage, hypothecate, write options o
n and lease any or all of the assets of the Trust; to purchase
and sell (or write) options on securities, currencies,
indices, futures contracts and other financial
instruments and enter into closing transactions in connection
therewith; to enter into all types
of commodities contracts, including
without limitation the purchase and sale of futures contracts
and forward contracts on securities, indices, currencies, and
other financial instruments; to
engage in forward commitment, "when issued" and delayed
delivery transactions; to enter into
repurchase agreements and reverse repurchase
agreements; and to employ all kinds of hedging
techniques and investment management strategies.
(b) To adopt By-Laws not inconsistent with
this Declaration of Trust providing for the conduct of
the business of the Trust and to amend and repeal them
to the extent that they do not reserve the right to the
Shareholders.
(c) To elect and remove such officers and appoint
and terminate such agents as they consider appropriate.
(d) To employ as custodian of any assets of the Trust
subject to any conditions set forth in this Declaration
of Trust or in the By-Laws, if any, a bank, trust company, or
other entity permitted by the Commission to serve as such.
(e) To retain a transfer agent and Shareholder servicing
agent, or both.
(f) To provide for the distribution of interests of the
Trust either through a principal underwriter in the manner
hereinafter provided for or by the Trust itself, or both.
(g) To set record dates in the manner hereinafter
provided for.
(h) To delegate such authority as they consider
desirable to any officers of the Trust and to any agent,
independent contractor, custodian or underwriter.
(i) To sell or exchange any or all of the assets of
the Trust, subject to the provisions of Article XI,
Section 4(b) hereof.
(j) To vote or give assent, or exercise any rights
of ownership, with respect to stock or other securities
or property; and to execute and deliver powers of attorney
to such person or persons as the Trustees shall deem
proper, granting to such person or persons such power
and discretion with relation to securities or property
as the Trustees shall deem proper.
(k) To exercise powers and rights of subscription or
otherwise which in any manner arise out of ownership
of securities.
(l) To hold any security or property in a form not
indicating any trust, whether in bearer, unregistered or
other negotiable form; or either in its own name or in the name
of a custodian or a nominee or nominees, subject in either case
to proper safeguards according to the usual practice of
Massachusetts trust companies or investment companies.
(m) To establish separate and distinct Series with
separately defined investment objectives and policies
and distinct investment purposes in accordance with
the provisions of Article III and to establish
separate Classes thereof.
(n) To allocate assets, liabilities and expenses of the
Trust to a particular Series and liabilities and expenses to a
particular Class thereof or to apportion the same between or
among two or more Series or Classes, provided that any
liabilities or expenses incurred by a particular Series or
Class shall be payable solely out of the assets belonging to
that Series or Class as provided for in Article III.
(o) To consent to or participate in any plan for the
reorganization, consolidation or merger of any corporation
or concern, any security of which is held in the Trust;
to consent to any contract, lease, mortgage, purchase,
or sale of property by such corporation or concern,
and to pay calls or subscriptions with respect to any
security held in the Trust.
(p) To compromise, arbitrate, or otherwise adjust
claims in favor of or against the Trust or any matter in
controversy including, but not limited to, claims for taxes.
(q) To make distributions of income and of capital gains
to Shareholders in the manner hereinafter provided for.
(r) To borrow money.
(s) To establish, from time to time, a minimum total
investment for Shareholders, and to require the redemption
of the Shares of any Shareholders whose investment is less
than such minimum upon giving notice to such Shareholder.
No one dealing with the Trustees shall be under any
obligation to make any inquiry concerning the authority
of the Trustees, or to see to the application of any
payments made or property transferred to the Trustees or
upon their order.
TRUSTEES AND OFFICERS AS SHAREHOLDERS
Section 2. Any Trustee, officer, other agent or
independent contractor of the Trust may acquire, own and
dispose of Shares to the same extent as if he were not a
Trustee, officer, agent or independent contractor; and the
Trustees may issue and sell or cause to be issued and sold
Shares to and buy such Shares from any such person or any
firm or company in which he is interested, subject only to
the general limitations herein contained as to the sale and
purchase of such Shares; and all subject to any restrictions
which may be contained in the By-Laws.
ACTION BY THE TRUSTEES
Section 3. The Trustees shall act by majority vote at a
meeting duly called or by unanimous written consent without
a meeting or by telephone consent provided a quorum of
Trustees participate in any such telephonic meeting,
unless the 1940 Act requires that a
particular action be taken only at a meeting in
person of the Trustees. At any meeting of the
Trustees, a majority of the Trustees shall constitute
a quorum. Meetings of the Trustees may
be called orally or in writing by the Chairman of
the Trustees or by any two other Trustees.
Notice of the time, date and place of all meetings of the
Trustees shall be given by the party
calling the meeting to each Trustee by telephone or telegram
sent to his home or business
address at least twenty-four hours in advance of the meeting or
by written notice mailed to his
home or business address at least seventy-two hours in
advance of the meeting. Notice need not
be given to any Trustee who attends the meeting without
objecting to the lack of notice or who
executes a written waiver of notice with respect to the
meeting either before or after such
meeting. Subject to the requirements of the 1940 Act,
the Trustees by majority vote may
delegate to any one of their number their authority to
approve particular matters or take
particular actions on behalf of the Trust.
CHAIRMAN OF THE TRUSTEES
Section 4. The Trustees may appoint one of their
number to be Chairman of the Board
of Trustees. The Chairman shall preside at all meetings
of the Trustees, shall be responsible for
the execution of policies established by the
Trustees and the administration of the Trust, and
may be the chief executive, financial and/or
accounting officer of the Trust.
ARTICLE VI
EXPENSES OF THE TRUST
TRUSTEE REIMBURSEMENT
Section 1. Subject to the provisions of Article III,
Section 5, the Trustees shall be
reimbursed from the Trust estate or the
assets belonging to the appropriate Series for their
expenses and disbursements, including, without limitation,
fees and expenses of Trustees who are not Interested Persons
of the Trust, interest expense, taxes, fees and commissions
of every kind, expenses of pricing Trust portfolio securities,
expenses of issue, repurchase and redemption of Shares
including expenses attributable to a program of periodic
repurchases or redemptions, expenses of distributing its Shares
and providing services to Shareholders,
expenses of registering and qualifying the Trust and its
Shares under Federal and State laws and
regulations, charges of investment advisers, administrators,
custodians, transfer agents, and registrars, expenses of
preparing and setting in type prospectuses and statements
of additional information, expenses of printing and
distributing prospectuses and statements of additional
information sent to existing Shareholders, auditing and
legal expenses, reports to Shareholders,
expenses of meetings of Shareholders and proxy
solicitations therefor, insurance expense,
association membership dues and for such
non-recurring items as may arise, including litigation
to which the Trust is a party (except those losses
and expenses the indemnification of which is
not permitted under Article X hereof), and
for all losses and liabilities by them incurred in
administering the Trust; and for the payment of
such expenses, disbursements, losses and
liabilities the Trustees shall have a
lien on the assets belonging to the
appropriate Series prior to any rights or interests
of the Shareholders thereto. This section shall
not preclude the Trust from directly paying any of
the aforementioned fees and expenses.
ARTICLE VII
INVESTMENT ADVISER, PRINCIPAL UNDERWRITER AND
TRANSFER AGENT INVESTMENT ADVISER
Section 1. Subject to a Majority Shareholder Vote,
the Trustees may in their discretion
from time to time enter into an investment
advisory or management contract(s) with respect to
the Trust or any Series thereof whereby the other
party(ies) to such contract(s) shall undertake
to furnish the Trustees such management,
investment advisory, statistical and research facilities
and services and such other facilities and
services, if any, and all upon such terms and
conditions, as the Trustees may in their
discretion determine. Notwithstanding any provisions
of this Declaration of Trust, the Trustees may
authorize the investment adviser(s) (subject to
such general or specific instruments as the
Trustees may from time to time adopt) to effect
purchases, sales or exchanges of portfolio
securities and other investment instruments of the
Trust on behalf of the Trustees or may
authorize any officer, agent, or Trustee to effect such
purchases, sales or exchanges pursuant to
recommendations of the investment adviser (and all
without further action by the Trustees).
Any such purchases, sales and exchanges shall be
deemed to have been authorized by all of the Trustees.
The Trustees may, subject to applicable
requirements of the 1940 Act, including those
relating to Shareholder approval, authorize the
investment adviser to employ one or more sub-
advisers from time to time to perform such of
the acts and services of the investment adviser,
and upon such terms and conditions, as may be
agreed upon between the investment adviser and
sub-adviser.
PRINCIPAL UNDERWRITER
Section 2. The Trustees may in their discretion
from time to time enter into one or
more contract(s) providing for the sale
of the Shares, whereby the Trust may either agree to sell
the Shares to the other party to the contract
or appoint such other party its sales agent for such
Shares. In either case, the contract shall
be on such terms and conditions as may be prescribed
in the By-Laws, if any, and such further terms
and conditions as the Trustees may in their
discretion determine not inconsistent with
the provisions of this Article VII, or of the By-Laws,
if any; and such contract may also provide
for the repurchase or sale of Shares by such other
party as principal or as agent of the Trust.
The Trustees may in their discretion adopt a plan or
plans of distribution and enter into any
related agreements whereby the Trust finances directly
or indirectly any activity that is primarily
intended to result in sales of Shares. Such plan or
plans of distribution and any related agreements
may contain such terms and conditions as the
Trustees may in their discretion determine
subject to the requirements of Section 12 of the 1940
Act, Rule 12b-1 thereunder and any other
applicable rules and regulations.
TRANSFER AGENT
Section 3. The Trustees may in their discretion
from time to time enter into a transfer
agency and Shareholder service contract whereby the other
party shall undertake to furnish the
Trustees and Trust with transfer agency
and shareholder services. The contract shall be on such
terms and conditions as the Trustees may in their
discretion determine not inconsistent with the
provisions of this Declaration of Trust or of
the By-Laws, if any. Such services may be provided
by one or more entities, including one or more
agents of such other party.
PARTIES TO CONTRACT
Section 4. Any contract of the character described in
Sections 1, 2 and 3 of this Article
VII or that relates to the provision of
custodian services to the Trust may be entered into with
any corporation, firm, partnership, trust or
association, although one more of the Trustees or
officers of the Trust may be an officer,
director, trustee, shareholder, or member of such other
party to the contract, and no such
contract shall be invalidated or rendered voidable by reason
of the existence of any relationship, nor
shall any person holding such relationship be liable
merely by reason of such relationship for any
loss or expense to the Trust under or by reason of
said contract or accountable for any profit
realized directly or indirectly therefrom, provided that
the contract when entered into was reasonable
and fair and not inconsistent with the provisions
of this Article VII or the By-Laws, if any.
The same person (including a firm, corporation,
partnership, trust, or association) may be the
other party to contracts entered into pursuant to
Sections 1, 2 and 3 above or with respect to the
provision of custodian services to the Trust, and
any individual may be financially interested in
or otherwise affiliated with persons who are
parties to any or all of the contracts mentioned
in this Section 4.
PROVISIONS AND AMENDMENTS
Section 5. Any contract entered into pursuant to
Sections 1 and 2 of this Article VII
shall be consistent with and subject to the
applicable requirements of Sections 12 and 15 of the
1940 Act and the rules and orders thereunder
(including any amendments thereto or other
applicable Act of Congress hereafter enacted)
with respect to its continuance in effect, its
termination, and the method of authorization
and approval of such contract or renewal thereof.
ARTICLE VIII
SHAREHOLDERS' VOTING POWERS AND MEETINGS
VOTING POWERS
Section 1. The Shareholders shall have power to
vote (i) for the election of Trustees
as provided in Article IV, Section 2, (ii)
for the removal of Trustees as provided in Article IV,
Section 3(d), (iii) with respect to any
investment advisory or management contract as provided
in Article VII, Section 1, (iv) with respect to
any termination or reorganization of the Trust as
provided in Article XI, Section 4, (v) with
respect to the amendment of this Declaration of Trust
to the extent and as provided in Article XI,
Section 7, (vi) to the same extent as the shareholders
of a Massachusetts business corporation, as to
whether or not a court action, proceeding or
claim should be brought or maintained
derivatively or as a class action on behalf of the Trust
or the Shareholders, provided, however,
that a Shareholder of a particular Series shall not be
entitled to bring any derivative or class action
on behalf of any other Series of the Trust, and
provided further that, within a Series, a
Shareholder of a particular Class shall not be entitled
to bring any derivative or class action on
behalf of any other Class except with respect to matters
sharing a common fact pattern with said
Shareholder's own Class; and (vii) with respect to such
additional matters relating to the Trust as may be
required or authorized by law, by this
Declaration of Trust, or the By-Laws of the Trust,
if any, or any registration of the Trust with
the Commission or any State, or as the Trustees
may consider desirable. On any matter
submitted to a vote of the Shareholders, all
Shares shall be voted by individual Series, except
(i) when required by the 1940 Act, Shares shall be
voted in the aggregate and not by individual
Series; and (ii) when the Trustees have
determined that the matter affects only the interests of
one or more Classes, then only the Shareholders
of such Class or Classes shall be entitled to
vote thereon. Each whole Share shall be entitled
to one vote as to any matter on which it is
entitled to vote, and each fractional Share
shall be entitled to a proportionate fractional vote.
There shall be no cumulative voting in the
election of Trustees. Shares may be voted in person
or by proxy. Until Shares are issued, the Trustees
may exercise all rights of Shareholders and
may take any action required or permitted by law,
this Declaration of Trust or any By-Laws of
the Trust to be taken by Shareholders.
MEETINGS
Section 2. The first Shareholders' meeting shall
be held as specified in Section 2 of
Article IV at the principal office of the
Trust or such other place as the Trustees may designate.
Special meetings of the Shareholders or any
Series or Class thereof may be called by the
Trustees and shall be called by the Trustees
upon the written request of Shareholders owning
at least one-tenth of the outstanding Shares
entitled to vote. Whenever ten or more Shareholders
meeting the qualifications set forth in
Section 16(c) of the 1940 Act, as the same may be
amended from time to time, seek the opportunity
of furnishing materials to the other
Shareholders with a view to obtaining
signatures on such a request for a meeting, the Trustees
shall comply with the provisions of said
Section 16(c) and any rules or orders thereunder with
respect to providing such Shareholders access to
the list of the Shareholders of record of the
Trust or the mailing of such materials to
such Shareholders of record. Shareholders shall be
entitled to at least fifteen days' notice of any meeting.
QUORUM AND REQUIRED VOTE
Section 3. A majority of Shares entitled to
vote in person or by proxy shall be a
quorum for the transaction of business at
a Shareholders' meeting, except that where any
provision of law or of this Declaration of
Trust permits or requires that holders of any Series or
Class thereof shall vote as a Series or Class,
then a majority of the aggregate number of Shares
of that Series or Class thereof entitled to
vote shall be necessary to constitute a quorum
for the transaction of business by that Series or Class.
Any lesser number shall be sufficient for
adjournments. Any adjourned session or
sessions may be held, within a reasonable time after
the date set for the original meeting, without
the necessity of further notice. Except when a
larger vote is required by any provision of
this Declaration of Trust or the By-Laws, a majority
of the Shares voted in person or by proxy
shall decide any questions and a plurality shall elect
a Trustee, provided that where any provision
of law or of this Declaration of Trust permits or
requires that the holders of any Series or Class
shall vote as a Series or Class, then a majority
of the Shares of that Series or Class voted on
the matter shall decide that matter insofar as that
Series or Class is concerned.
ARTICLE IX
DISTRIBUTIONS AND REDEMPTIONS
DISTRIBUTIONS
Section 1.
(a) The Trustees may from time to time declare
and pay dividends and other
distributions. The amount of such
dividends and the payment of them shall be wholly in the
discretion of the Trustees.
(b) The Trustees shall have power, to the
fullest extent permitted by the laws of
the Commonwealth of Massachusetts, at any time
to declare and cause to be paid dividends on
Shares of a particular Series, from the
assets belonging to that Series, which dividends and other
distributions, at the election of the Trustees,
may be paid daily or otherwise pursuant to a
standing resolution or resolutions adopted
only once or with such frequency as the Trustees may
determine, and may be payable in Shares of
that Series or Class thereof, as appropriate, at the
election of each Shareholder of that Series or
Class. All dividends and distributions on Shares
of a particular Series shall be distributed pro
rata to the holders of that Series in proportion to
the number of Shares of that Series held by such
holders at the date and time of record
established for the payment of such
dividends or distributions, except that such dividends and
distributions shall appropriately reflect expenses
allocated to a particular Class of such Series.
(c) Anything in this instrument to the contrary
notwithstanding, the Trustees may
at any time declare and distribute a
"stock dividend" pro rata among the Shareholders of a
particular Series or of a Class thereof as of
the record date of that Series (fixed as provided in
Section 3 of Article XI hereof).
REDEMPTIONS
Section 2. In case any holder of record of
Shares of a particular Series or Class desires
to dispose of his Shares, he may deposit at
the office of the transfer agent or other authorized
agent of that Series a written request or such
other form of request as the Trustees may from
time to time authorize, requesting that
the Series purchase the Shares in accordance with this
Section 2; and the Shareholder so requesting
shall be entitled to require the Series to purchase,
and the Series or the principal underwriter of
the Series shall purchase his said Shares, but only
at the Net Asset Value of the Series or Class h
eld by the Shareholder (as described in Section
3 hereof) minus any applicable sales charge or
redemption or repurchase fee. The Series shall
make payment for any such Shares to be redeemed,
as aforesaid, in cash or property from the
assets of that Series and payment for such
Shares shall be made by the Series or the principal
underwriter of the Series to the Shareholder of
record within seven (7) days after the date upon
which the request is effective; provided, however,
that if Shares being redeemed have been
purchased by check, the Trust may postpone payment
until the Trust has assurance that good
payment has been collected for the purchase
of the Shares. The Trust may require Shareholders
to pay a sales charge to the Trust, the underwriter
or any other person designated by the Trustees
upon redemption or repurchase of Shares of
any Series or Class thereof, in such amount as shall
be determined from time to time by the Trustees.
The amount of such sales charge may but need
not vary depending on various factors, including
without limitation the holding period of the
redeemed or repurchased Shares. The Trustees
may also charge a redemption or repurchase
fee in such amount as may be determined from
time to time by the Trustees.
DETERMINATION OF NET ASSET VALUE AND VALUATION OF PORTFOLIO
ASSETS
Section 3. The term "Net Asset Value" of any Series
shall mean that amount by which
the assets of that Series exceed its
liabilities, all as determined by or under
the direction of the Trustees. Net Asset Value per
Share shall be determined separately for each Series of Shares
and shall be determined on such days and at such times
as the Trustees may determine. Such
determination may be made on a Series-by-Series
or Class-by-Class basis, as appropriate, and
shall include any expenses allocated to a
specific Series or Class. The determination shall be
made with respect to securities for which
market quotations are readily available at the market
value of such securities; and with respect to
other securities and assets, at the fair value as
determined in good faith by the Trustees,
provided, however, that the Trustees, without
Shareholder approval, may alter the method of
appraising portfolio securities insofar as
permitted under the 1940 Act and the rules,
regulations and interpretations thereof promulgated
or issued by the Commission or insofar as permitted
by any order of the Commission applicable
to the Series. The Trustees may delegate
any of their powers and duties under this Section 3
with respect to appraisal of assets and liabilities.
At any time the Trustees may cause the Net
Asset Value per Share last determined to be
determined again in a similar manner and may fix
the time when such redetermined values shall become effective.
SUSPENSION OF THE RIGHT OF REDEMPTION
Section 4. Notwithstanding Section 2 hereof,
the Trustees may declare a suspension
of the right of redemption or postpone the
date of payment as permitted under the 1940 Act.
Such suspension shall take effect at such time as
the Trustees shall specify but not later than the
close of business on the business day next
following the declaration of suspension, and
thereafter there shall be no right of redemption
or payment until the Trustees shall declare the
suspension at an end. 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
per Share existing after the termination of the suspension.
ARTICLE X
LIMITATION OF LIABILITY AND INDEMNIFICATION
LIMITATION OF LIABILITY
Section 1. All persons extending credit to, contracting
with or having any claim
against the Trust or a particular Series shall
look only to the assets of the Trust or such Series,
as the case may be, for payment under such credit,
contract or claim; and neither the
Shareholders nor the Trustees, nor any of the Trust's
officers, employees or agents, whether past,
present or future, nor any other Series shall
be personally liable therefor.
Every note, bond, contract, instrument, certificate
or undertaking and every other act
or thing whatsoever executed or done by or on
behalf of the Trust, any Series, or the Trustees
or any of them in connection with the Trust shall
be conclusively deemed to have been executed
or done only in or with respect to their or
his capacity as Trustees or Trustee and neither such
Trustees or Trustee nor the Shareholders shall be
personally liable thereon. Every note, bond,
contract, instrument, certificate or undertaking
made or issued by the Trustees or by any officers
or officer shall give notice that the same was
executed or made by them on behalf of the Trust
or by them as Trustees or Trustee or as officers
or officer and not individually and that the
obligations of such instrument are not binding
upon any of them or the Shareholders individually
but are binding only upon the assets and property
of the Trust or the particular Series in
question, as the case may be, but the omission
thereof shall not operate to bind any Trustees or
Trustee or officers or officer or Shareholders or
Shareholder individually.
Section 2. Provided they have exercised reasonable
care and have acted under the
reasonable belief that their actions are in the
best interest of the Trust, the Trustees and officers
of the Trust shall not be responsible for or liable
in any event for neglect or wrongdoing of them
or any officer, agent, employee, investment
adviser or independent contractor of the Trust, but
nothing contained in this Declaration of Trust
shall protect any Trustee or officer against any
liability to which he would otherwise be subject
by reason of willful misfeasance, bad faith,
gross negligence or reckless disregard of the
duties involved in the conduct of his office.
INDEMNIFICATION
Section 3.
(a) Subject to the exceptions and limitations
contained in Section 3(b) below:
(i) every person who is, or has been a
Trustee or officer of the Trust
(hereinafter referred to as "Covered Person") shall
be indemnified by the appropriate Series to
the fullest extent permitted by law against
liability and against all expenses reasonably incurred
or paid by him in connection with any claim,
action, suit or proceeding in which he becomes
involved as a party or otherwise by virtue of
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 while in office or thereafter, and the words
"liability" and "expenses" shall include,
without limitation, attorneys' fees,
costs, judgments, amounts paid in settlement, fines,
penalties and other liabilities.
(b) No indemnification shall be provided
hereunder to a Covered Person:
(i) who shall have been adjudicated by a
court or body before which the proceeding was
brought (A) to be liable to the Trust or its
Shareholders by reason of willful
misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the
conduct of his office or (B) not to have acted
in good faith in the reasonable belief that his action
was in the best interest of the Trust; or
(ii) in the event of a settlement, unless
there has been a determination
that such Trustee or officer did not engage
in willful misfeasance, bad faith, gross negligence
or reckless disregard of the duties involved in
the conduct of his office,
(A) by the court or other body
approving the settlement;
(B) by at least a majority of
those Trustees who are neither
interested persons of the Trust nor
are parties to the matter based upon a
review of readily available facts
(as opposed to a full trial-type inquiry); or
(C) by written opinion of independent
legal counsel based upon a review of
readily available facts (as opposed to
a full trial-type inquiry); provided,
however, that any Shareholder may, by
appropriate legal proceedings, challenge any
such determination by the Trustees, or by independent counsel.
(c) The rights of indemnification herein provided may
be insured against by policies maintained by the Trust,
shall be severable, shall not be exclusive of or
affect any other rights to which any Covered Person
may now or hereafter be entitled, shall continue as to a
person who has ceased to be such Trustee or officer and shall
inure to the benefit of the heirs, executors and
administrators of such a person. Nothing contained
herein shall affect any rights to indemnification
to which Trust personnel, other than Trustees and
officers, and other persons may be entitled to by
contract or otherwise under law.
(d) Expenses in connection with the preparation and
presentation of a defense to any claim, action,
suit or proceeding of the character described in
paragraph (a) of this Section 3 may be paid by the
applicable Series from time to time prior to final
disposition thereof upon receipt of an undertaking
by or on behalf of such Covered Person that such amount
will be paid over by him to the applicable Series if
it is ultimately determined that he is not
entitled to indemnification under this Section 3;
provided, however, that either (a) such Covered
Person shall have provided appropriate security
for such undertaking, (b) the Trust is insured
against losses arising out of any such advance
payments or (c) either a majority of the Trustees
who are neither interested persons of the Trust
nor parties to the matter, or independent legal
counsel in a written opinion, shall have determined,
based upon a review of readily available
facts (as opposed to a trial-type inquiry or full
investigation), that there is reason to believe that
such Covered Person will not be disqualified from
indemnification under this Section 3.
SHAREHOLDERS
Section 4. In case any Shareholder or former
Shareholder of any Series of the Trust
shall be held to be personally liable solely
by reason of his being or having been a Shareholder
and not because of his acts or omissions or for
some other reason, the Shareholder or former
Shareholder (or his heirs, executors,
administrators or other legal representatives or in the case
of a corporation or other entity, its corporate or
other general successor) shall be entitled out of
the assets belonging to the applicable Series to
be held harmless from and indemnified against
all loss and expense arising from such liability.
The Series shall, upon request by the
Shareholder, assume the defense of
any claim made against the Shareholder for any act or
obligation of the Series and satisfy any judgment
thereon.
ARTICLE XI
MISCELLANEOUS
TRUST NOT A PARTNERSHIP
Section 1. It is hereby expressly declared
that a trust and not a partnership is created
hereby. No Trustee hereunder shall have any power
to bind personally either the Trust's officers
or any Shareholder.
TRUSTEE'S GOOD FAITH ACTION, EXPERT ADVICE, NO BOND OR SURETY
Section 2. The exercise by the Trustees of their
powers and discretion hereunder in
good faith and with reasonable care under
the circumstances then prevailing, shall be binding
upon everyone interested. Subject to the
provisions of Article X, the Trustees shall not be liable
for errors of judgment or mistakes of fact or law.
The Trustees may take advice of counsel or
other experts with respect to the meaning
and operation of this Declaration of Trust, and subject
to the provisions of Article X, shall be under
no liability for any act or omission in accordance
with such advice or for failing to follow such advice.
The Trustees shall not be required to give
any bond as such, nor any surety if a bond is obtained.
ESTABLISHMENT OF RECORD DATES
Section 3. The Trustees may close the
stock transfer books of the Trust for a period
not exceeding sixty (60) days preceding the
date of any meeting of Shareholders, or the date for
the payment of any dividends, or the date for
the allotment of rights, or the date when any change
or conversion or exchange of Shares shall go
into effect; or in lieu of closing the stock transfer
books as aforesaid, the Trustees may fix in
advance a date, not exceeding ninety (90) days
preceding the date of any meeting of Shareholders,
or the date for payment of any dividend, or
the date for the allotment of rights, or the
date when any change or conversion or exchange of
Shares shall go into effect, as a record date for
the determination of the Shareholders entitled to
notice of, and to vote at, any such meeting, or to
receive payment of such dividend, or to receive
such allotment or rights, or to exercise such
rights in respect of any such change, conversion or
exchange of Shares, and in such case such
Shareholders and only such Shareholders as shall be
Shareholders of record on the date so fixed shall
be entitled to such notice of, and to vote at,
such meeting, or to receive payment of such
dividend, or to receive such allotment of rights, or
to exercise such rights, as the case may be,
notwithstanding any transfer of any Shares on the
books of the Trust after any such record date
fixed or aforesaid.
TERMINATION OF TRUST
Section 4.
(a) This Trust shall continue without
limitation of time but subject to the
provisions of sub-section (b) of this Section 4.
(b) Subject to a Majority Shareholder
Vote of each Series affected by the matter
or, if applicable, to a Majority Shareholder
Vote of the Trust, the Trustees may
(i) sell, convey, merge and transfer
all or substantially all of the assets
of the Trust or any affected Series to another Series
or to a trust, partnership, association or
corporation organized under the laws of any state
which is an investment company as defined
in the 1940 Act, for adequate consideration
which may include the assumption of all outstanding
obligations, taxes and other liabilities, accrued
or contingent, of the Trust or any affected Series,
and which may include shares of beneficial interest
or stock of such Series, trust, partnership,
association or corporation; or
(ii) at any time sell and convert into
money all or substantially all of the
assets of the Trust or any affected Series.
Upon making provision for the payment
of all known liabilities of the Trust or any
affected Series in either (i) or (ii), by such
assumption or otherwise, the Trustees shall distribute
the remaining proceeds or assets (as the case may be)
ratably among the holders of the Shares
of the Trust or any affected Series then
outstanding; however, the payment to any particular
Class within such Series may be reduced by any fees,
expenses or charges allocated to that
Class. Nothing in this Declaration of Trust
shall preclude the Trustees from distributing such
remaining proceeds or assets so that holders of
the Shares of a particular Class of the Trust or
any affected Series receive as their ratable
distribution shares solely of an analogous class, as
determined by the Trustees, of such trust, partnership,
association or corporation.
The Trustees may take any of the actions specified
in clauses (i) and (ii) above without
obtaining a Majority Shareholder Vote of
any Series or the Trust if a majority of the Trustees
makes a determination that the continuation of a
Series or the Trust is not in the best interests
of such Series, the Trust or their respective
Shareholders as a result of factors or events
adversely affecting the ability of such Series
or the Trust to conduct its business and operations
in an economically viable manner. Such factors
and events may include the inability of a Series
or the Trust to maintain its assets at an
appropriate size, changes in laws or regulations
governing the Series or Trust or affecting assets
of the type in which such Series or the Trust
invests or economic developments or trends
having a significant adverse impact on the business
or operations of such Series or the Trust.
(c) Upon completion of the distribution of
the remaining proceeds or the
remaining assets as provided in sub-section (b),
the Trust or any affected Series shall terminate
and the Trustees shall be discharged of any and
all further liabilities and duties hereunder with
respect thereto and the right, title and interest
of all parties therein shall be canceled and
discharged.
FILING OF COPIES, REFERENCES, HEADINGS
Section 5. The original or a copy of this
instrument and of each amendment hereto
shall be kept at the office of the Trust where
it may be inspected by any shareholder. A copy
of this instrument and of each amendment hereto
shall be filed by the Trustees with the
Secretary of the Commonwealth of Massachusetts
and the Boston City Clerk, as well as any
other governmental office where such filing
may from time to time be required. Anyone dealing
with the Trust may rely on a certificate by an
officer or Trustee of the Trust as to whether or not
any such amendments to this Declaration of Trust
have been made and as to any matters in
connection with the Trust hereunder, and
with the same effect as if it were the original, may rely
on a copy certified by an officer or Trustee of the
Trust to be a copy of this instrument or of any
such amendments. In this instrument or in any
such amendments, references to this instrument,
and all expressions like "herein," "hereof" and
"hereunder," shall be deemed to refer to this
instrument as amended from time to time.
The masculine gender shall include the feminine and
neuter genders. Headings are placed herein for
convenience of reference only, and in case of
any conflict, the text of this instrument,
rather than the headings, shall control. This instrument
may be executed in any number of counterparts
each of which shall be deemed an original.
APPLICABLE LAW
Section 6. The Trust set forth in this
instrument is made in the Commonwealth of
Massachusetts, and it is created under and is
to be governed by and construed and administered
according to the laws of said Commonwealth.
The Trust shall be of the type commonly called
a Massachusetts business trust, and, without
limiting the provisions hereof, the Trust may
exercise all powers which are ordinarily
exercised by such a trust.
AMENDMENTS
Section 7. All rights granted to the
Shareholders under this Declaration of Trust are
granted subject to the reservation of the right to
amend this Declaration of Trust as herein
provided, except that no amendment shall
repeal the limitations on personal liability of any
Shareholder or Trustee or repeal the prohibition
of assessment upon the Shareholders without
the express consent of each Shareholder or
Trustee involved. Subject to the foregoing, the
provisions of this Declaration of Trust
(whether or not related to the rights of Shareholders) may
be amended at any time, so long as such
amendment does not adversely affect the rights of any
Shareholder with respect to which such amendment
is or purports to be applicable and so long
as such amendment is not in contravention of
applicable law, including the 1940 Act, by an
instrument in writing signed by a majority of
the then Trustees (or by an officer of the Trust
pursuant to the vote of a majority of such Trustees).
Except as provided in the first sentence of
this Section 7, any amendment to this
Declaration of Trust that adversely affects the rights of
Shareholders may be adopted at any time by an
instrument signed in writing by a majority of the
then Trustees (or by an officer of the Trust pursuant
to the vote of a majority of such Trustees)
when authorized to do so by Majority Shareholder
Vote; provided, however, that an amendment
that shall affect the Shareholders of one
or more Series (or of one or more Classes),
but not the Shareholders of all outstanding
Series (or Classes), shall be authorized by a Majority
Shareholder Vote of each Series (or Class, as the case
may be) affected, and no vote of a Series
(or Class) not affected shall be required.
Subject to the foregoing, any such amendment shall
be effective as provided in the instrument
containing the terms of such amendment or, if there
is no provision therein with respect to effectiveness,
upon the execution of such instrument and
of a certificate (which may be a part of
such instrument) executed by a Trustee or officer to the
effect that such amendment has been duly adopted.
Copies of the amendment to this Declaration
of Trust shall be filed as specified in
Section 5 of this Article XI. A restated Declaration of
Trust, integrating into a single instrument all
of the provisions of the Declaration of Trust which
are then in effect and operative, may be executed
from time to time by a majority of the Trustees
and shall be effective upon filing as
specified in such Section 5.
FISCAL YEAR
Section 8. The fiscal year of the Trust
shall be determined by the Trustees in
accordance with the By-Laws, provided,
however, that the Trustees may, without Shareholder
approval, change the fiscal year of the Trust. <PAGE>
Schedule A
Series of the Trust
PaineWebber Municipal High Income Fund
PaineWebber New York Tax-Free Income Fund
Classes of Shares of Each Series
An unlimited number of shares of beneficial
interest have been established by the Board as
Class A shares, Class B shares, Class C shares
and Class Y shares of each of the above Series.
Each of the Class A shares, Class B shares,
Class C shares and Class Y shares of a Series
represents interests in the assets of only
that Series and has the same preferences, conversion
and other rights, voting powers, restrictions,
limitations as to dividends, qualifications and terms
and conditions of redemption of shares, except as
provided in the Trust's Declaration of Trust
and as set forth below with respect to the
Class B shares of each Series:
1. Each Class B share, other than a share
purchased through the reinvestment of a
dividend or a distribution with
respect to the Class B share, shall be converted
automatically, and without any action or choice
on the part of the holder
thereof, into Class A shares of the same
Series, based on the relative net asset
value of each such class at the time of
the calculation of the net asset value of
such class of shares on the date that is
the first Business Day (as defined in the
Series' prospectus and/or statement of
additional information) of the month in
which the sixth anniversary of the issuance
of such Class B shares occurs
(which, for the purpose of calculating
the holding period required for
conversion, shall mean (i) the date on
which the issuance of such Class B
shares occurred or (ii) for Class B shares
obtained through an exchange, the
date on which the issuance of the Class B
shares of an eligible PaineWebber
fund occurred, if such shares were exchanged
directly, or through a series of
exchanges for the Series Class B shares
(the "Conversion Date")).
2. Each Class B share purchased through the
reinvestment of a dividend or a
distribution with respect to the Class B
shares and the dividends and
distributions on such shares shall be
segregated in a separate sub-account on
the stock records of the Series for each of
the holders of record thereof. On
any Conversion Date, a number of the shares
held in the sub-account of the
holder of record of the share or shares being
converted, calculated in
accordance with the next following sentence,
shall be converted automatically,
and without any action or choice on the
part of the holder thereof, into Class A
shares of the same Series. The number of
shares in the holder's sub-account so
converted shall bear the same relation to
the total number of shares maintained
in the sub-account on the Conversion Date
as the number of shares of the
holder converted on the Conversion Date
pursuant to Paragraph 2(a) hereof
bears to the total number of Class B shares
of the holder on the Conversion
Date not purchased through the automatic
reinvestment of dividends or
distributions with respect to the Class B shares.
3. The number of Class A shares into which a
Class B share is converted
pursuant to paragraphs 1 and 2 hereof
shall equal the number (including for
this purpose fractions of a share) obtained
by dividing the net asset value per
share of the Class B shares for purposes
of sales and redemptions thereof at
the time of the calculation of the net
asset value on the Conversion Date by the
net asset value per share of the Class A
shares for purposes of sales and
redemptions thereof at the time of the
calculation of the net asset value on the
Conversion Date.
4. On the Conversion Date, the Class B shares
converted into Class A shares will
cease to accrue dividends and will no
longer be outstanding and the rights of
the holders thereof will cease (except
the right to receive declared but unpaid
dividends to the Conversion Date).
For purposes of Paragraph 1 above, the term
"eligible PaineWebber fund" includes any and all
mutual funds for which PaineWebber Incorporated
or Mitchell Hutchins Asset Management Inc.
serves as investment adviser that offer
shares with a contingent deferred sales charge imposed
upon certain redemptions of such shares and that
are exchangeable with the Class B shares of
the Series.
[The next page of this Declaration of Trust also is
numbered page 22.]<PAGE>
IN WITNESS WHEREOF, the undersigned, being the all the Trustees
of the Trust, have executed this Amended and Restated
Declaration of Trust as of the day and year first above
written.
/s/ Margo N. Alexander
Margo N. Alexander
/s/ Meyer Feldberg
Meyer Feldberg
/s/ E. Garrett Bewkes, Jr.
A. Garrett Bewkes, Jr.
/s/ George W. Gowen
George W. Gowen
/s/ Richard Q. Armstrong
Richard Q. Armstrong
/s/ Frederic V. Malek
Frederic V. Malek
/s/ Richard R. Burt
Richard R. Burt
/s/ Carl W. Schafer
Carl W. Schafer
/s/ Mary C. Farrell
Mary C. Farrell
<PAGE>
PaineWebber Municipal Series
Attachment 1
1. The principal place of business of
PaineWebber Municipal Series ( Trust ) is:
1285 Avenue of the Americas
New York, New York 10019
2. The Trustees of the Trust and their business addresses*
are:
Margo N. Alexander
Richard Q. Armstrong
78 West Brother Drive
Greenwich, CT 06830
E. Garrett Bewkes, Jr.
Richard R. Burt
1101 Connecticut Avenue, N.W.
Washington, D. C. 20036
Mary C. Farrell
Meyer Feldberg
Columbia University
101 Uris Hall
New York, New York 10027
George W. Gowen
666 Third Avenue
New York, New York 10017
Frederic V. Malek
1455 Pennsylvania Avenue, N.W.
Suite 350
Washington, D. C. 20004
Carl W. Schafer
P. O. Box 1164
Princeton, N. J. 08542
* Unless otherwise indicated, the business
address of each Trustee is
1285 Avenue of the Americas, New York, New York 10019
<PAGE>
PAINEWEBBER MUNICIPAL SERIES
A Massachusetts Business Trust
RESTATED BY-LAWS
November 19, 1997<PAGE>
BY-LAWS OF PAINEWEBBER MUNICIPAL SERIES
ARTICLE I
DECLARATION OF TRUST,
LOCATION OF OFFICES AND SEAL
Section 1.01. Declaration of Trust: These By-Laws
shall be subject to the Declaration
of Trust, as from time to time in effect
(the "Declaration of Trust"), of PaineWebber Municipal
Series, the Massachusetts business trust established by
the Declaration of Trust (the "Trust").
Section 1.02. Principal Office of
the Trust: Resident Agent: The principal office of
the Trust shall be located in the City of New York,
New York. Its resident agent in
Massachusetts shall be CT Corporation System,
2 Oliver Street, Boston, Massachusetts, or such
other person as the Trustees may from time to
time designate. The Trust may establish and
maintain such other offices and places of
business as the Trustees may, from time to time,
determine.
Section 1.03. Seal: The seal of the Trust
shall be circular in form and shall bear the
name of the Trust. The form of the seal shall
be subject to alteration by the Trustees and the seal
may be used by causing it or a facsimile to be
impressed or affixed or printed or otherwise
reproduced. Any officer or Trustee of the
Trust shall have authority to affix the seal of the Trust
to any document, instrument or other paper executed
and delivered by or on behalf of the Trust;
however, unless otherwise required by the
Trustees, the seal shall not be necessary to be placed
on and its absence shall not impair the validity
of any document, instrument, or other paper
executed by or on behalf of the Trust.
ARTICLE II
SHAREHOLDERS
Section 2.01. Shareholder Meetings: Meetings
of the shareholders may be called at
any time by the Trustees or, if the Trustees
shall fail to call any meeting for a period of 30 days
after written request of Shareholders owning at
least one-tenth of the outstanding shares entitled
to vote, then such Shareholders may call such meeting.
Each call of a meeting shall state the
place, date, hour and purposes of the meeting.
Section 2.02. Place of Meetings: All meetings
of the Shareholders shall be held at the
principal office of the Trust, except that the
Trustees may designate a different place of meeting
within the United States.
Section 2.03. Notice of Meeting: The secretary
or an assistant secretary or such other
officer as may be designated by the Trustees
shall cause notice of the place, date and hour, and
purpose or purposes for which the meeting is called,
to be mailed, not less than fifteen days
before the date of the meeting, to each Shareholder
entitled to vote at such meeting, at his
address as it appears on the records of the
Trust at the time of such mailing. Notice of any
Shareholders' meeting need not be given to any
Shareholder if a written waiver of notice,
executed before or after such meeting, is
filed with the records of such meeting, or to any
Shareholder who shall attend such meeting in
person or by proxy. Notice of adjournment of a
Shareholders' meeting to another time or place
need not be given, if such time and place are
announced at the meeting.
Section 2.04. Ballots: The vote upon any
question shall be by ballot whenever
requested by any person entitled to vote, but,
unless such a request is made, voting may be
conducted in any way approved by the meeting.
Section 2.05. Voting; Proxies: Shareholders
entitled to vote may vote either in person
or by proxy, provided that such proxy to act is
authorized to act by (1) a written instrument,
dated not more than eleven months before the
meeting and executed either by the Shareholder
or by his or her duly authorized attorney in
fact (who may be so authorized by a writing or by
any non-written means permitted by the laws of
the Commonwealth of Massachusetts) or (2)
such electronic, telephonic, computerized or
other alternative means as may be approved by a
resolution adopted by the Trustees. Proxies
shall be delivered to the secretary of the Trust or
other person responsible for recording the
proceedings before being voted. A proxy with
respect to shares held in the name of two or
more persons shall be valid if executed by one of
them unless at or prior to exercise of such proxy
the Trust receives a specific written notice to
the contrary from any one of them. Unless
otherwise specifically limited by their terms, proxies
shall entitle the holder thereof to vote at any
adjournment of a meeting. A proxy purporting to
be exercised by or on behalf of a Shareholder shall
be deemed valid unless challenged at or
prior to its exercise and the burden of proving
invalidity shall rest on the challenger. At all
meetings of the Shareholders, unless the voting
is conducted by inspectors, all questions relating
to the qualifications of voters, the validity of
proxies, and the acceptance or rejection of votes
shall be decided by the chairman of the meeting.
Section 2.06. Action Without a Meeting:
Any action to be taken by Shareholders may
be taken without a meeting if all Shareholders
entitled to vote on the matter consent to the action
in writing and the written consents are filed with the
records of meetings of Shareholders of the
Trust. Such consent shall be treated for all
purposes as a vote at a meeting.
ARTICLE III
TRUSTEES
Section 3.01. Regular Meetings: Regular meetings
of the Trustees may be held
without further call or notice at such places and at
such times as the Trustees may from time to
time determine, provided that notice of the
first regular meeting following any such
determination shall be given to absent
Trustees. A regular meeting of the Trustees may be held
without further call or notice immediately after
and at the same place as any meeting of the
Shareholders.
Section 3.02. Special Meetings: Special
meetings of the Trustees may be held at any
time and at any place designated in the call of
the meeting, when called by the chairman of the
Trustees or by two or more Trustees, provided
that notice thereof shall being given to each
Trustee as set forth in the Declaration of Trust.
Section 3.03. Committees: The Trustees,
by vote of a majority of the Trustees then
in office, may elect from their number an executive
committee or other committees and may
delegate thereto some or all of their powers
except those which by law, by the Declaration of
Trust, or by these By-Laws may not be delegated.
Except as the Trustees may otherwise
determine, any such committee may make rules for
the conduct of its business, but unless
otherwise provided by the Trustees or in such rules,
its business shall be conducted so far as
possible in the same manner as is provided
by these By-Laws for the Trustees themselves. All
members of such committees shall hold such offices
at the pleasure of the Trustees. The
Trustees may abolish any such committee at
any time. Any committee to which the Trustees
delegate any of their powers or duties shall
keep records of its meetings and shall report its
actions to the Trustees. The Trustees shall have
power to rescind any action of any committee,
but no such rescission shall have retroactive
effect. Any such committee may act by meeting
in person, by unanimous written consent, or by
telephonic meeting provided a quorum of
members participates in any such telephonic meeting.
Section 3.04. Other Committees: The Trustees
may appoint other committees, each
consisting of one or more persons, who need
not be Trustees. Each such committee shall have
such powers perform such duties and abide by such
procedures as may be determined from time
to time by the Trustees, but shall not exercise
any power which may lawfully be exercised only
by the Trustees or a committee of Trustees.
Section 3.05. Compensation: Each Trustee
and each committee member may receive
such compensation for his services and
reimbursement for his expenses as may be fixed from
time to time by resolution of the Trustees.
ARTICLE IV
OFFICERS
Section 4.01. General: The officers of the
Trust shall be a president, a treasurer, a
secretary and such other officers, if any, as the
Trustees from time to time may in their discretion
elect or appoint. The Trust may also have such
agents, if any, as the Trustees from time to time
may in their discretion appoint. Any officer
may be but need not be a Trustee or shareholder.
Any two or more offices may be held by the same person.
Section 4.02. Election and Term of Office:
The president, the treasurer and the
secretary shall be elected annually by the
Trustees at their first meeting in each calendar year
or at such later meeting in such year as the
Trustees shall determine ("Annual Meeting"). Other
officers or agents, if any, may be elected or
appointed by the Trustees at said meeting or at any
other time. The president, treasurer and secretary
shall hold office until the next Annual
Meeting and until their respective successors
are chosen and qualified, or in each case until he
dies, resigns, is removed or become disqualified.
Each other officer shall hold office and each
agent shall retain his authority at the pleasure
of the Trustees.
Section 4.03. Powers: Subject to the other
provisions of these By-Laws, each officer
shall have, in addition to the duties and powers
herein and in the Declaration of Trust set forth,
such duties and powers as are commonly incident
to his office as if the Trust were organized as
a Massachusetts business corporation and such
other duties and powers as the Trustees may
from time to time designate.
Section 4.04. Chairman of the Board:
The chairman of the Board of Trustees, if one
is so appointed, shall be chosen from among the
Trustees and may hold office only so long as
he continues to be a Trustee. Unless the
Trustees otherwise provide, the chairman, if any is so
appointed, shall preside at all meetings of the
Shareholders and of the Trustees at which he is
present; may be ex officio a member of all
committees established by the Trustees; and shall
have such other duties and powers as specified
herein and as may be assigned to him by the
Trustees.
Section 4.05. President: The president
shall be the chief executive officer of the Trust
and, subject to the supervision of the Trustees,
shall have general charge of the business, affairs
and property of the Trust and general supervision
over its officers, employees and agents. He
shall exercise such other powers and perform
such other duties as from time to time may be
assigned to him by the Trustees.
Section 4.06. Vice Presidents: The Trustees
may from time to time designate and
elect one or more vice presidents who shall
have such powers and perform such duties as from
time to time may be assigned to them by the
Trustees or the president. At the request or in the
absence or disability of the president, the
vice president (or, if there are two or more vice
presidents, then the senior of the vice
presidents present and able to act) may perform all the
duties of the president and, when so acting, shall
have all the powers of and be subject to all the
restrictions upon the president.
Section 4.07. Treasurer and Assistant Treasurers:
The treasurer shall be the principal
financial and accounting officer of the Trust
and shall have general charge of the finances and
books of account of the Trust. Except as otherwise
provided by the Trustees, he shall have
general supervision of the funds and property
of the Trust and of the performance by the
custodian of its duties with respect thereto.
He shall render to the Trustees, whenever directed
by the Trustees, an account of the financial
condition of the Trust and of all his transactions as
treasurer; and as soon as possible after the close of
each financial year he shall make and submit
to the Trustees a like report for such financial year.
He shall perform all the acts incidental to
the office of treasurer, subject to the control
of the Trustees.
Any assistant treasurer may perform such
duties of the treasurer as the treasurer or the
Trustees may assign, and, in the absence of the
treasurer, (or, if there are two or more assistant
treasurers, then the senior of the assistant
treasurers present and able to act) may perform all the
duties of the treasurer, subject to the control of
the Trustees.
Section 4.08. Secretary and Assistant Secretaries:
The secretary shall attend to the
giving and serving of all notices of the
Trust and shall record all proceedings of the meetings
of the Shareholders and Trustees in books to be kept
for that purpose. He shall keep in safe
custody the seal of the Trust, and shall
have charge of the records of the Trust, all of which shall
at all reasonable times be open to inspection by the Trustees.
He shall perform such other duties
as appertain to his office or as may be
required by the Trustees.
Any assistant secretary may perform such duties of
the secretary as the secretary or the
Trustees may assign, and, in the absence of the
secretary, (or, if there are two or more assistant
secretaries. then the senior of the assistant
secretaries present and able to act) may perform all
the duties of the secretary.
Section 4.09. Subordinate Officers: The Trustees
from time to time may appoint such
other officers or agents as they may deem
advisable, each of whom shall have such title, hold
office for such period, have such authority and
perform such duties as the Trustees may
determine. The Trustees from time to time
may delegate to one or more officers or agents the
power to appoint any such subordinate officers or
agents and to prescribe their respective rights,
terms of office, authorities and duties.
Section 4.10. Remuneration: The salaries
or other compensation of the officers of the
Trust shall be fixed from time to time by resolution
of the Trustees, except that the Trustees may
by resolution delegate to any person or group
of persons the power to fix the salaries or other
compensation of any subordinate officers or agents
appointed in accordance with the provisions
of Section 4.09 hereof.
Section 4.11. Surety Bonds: The Trustees may r
equire any officer or agent of the
Trust to execute a bond (including, without
limitation, any bond required by the Investment
Company Act of 1940, as amended, ("1940 Act")
and the rules and regulations of the Securities
and Exchange Commission ("Commission")) to the
Trust in such sum and with such surety or
sureties as the Trustees may determine,
conditioned upon the faithful performance of his duties
to the Trust including responsibility for negligence
and for the accounting of any of the Trust's
property, funds or securities that may come into his hands.
Section 4.12. Resignation: Any officer
may resign his office at any time by delivering
a written resignation to the Trustees, the president,
the secretary, or any assistant secretary.
Unless otherwise specified therein, such
resignation shall take effect upon delivery.
Section 4.13. Removal: Any officer
may be removed from office whenever in the
judgment of the Trustees the best interest of
the Trust will be served thereby, by the vote of a
majority of the Trustees given at a regular
meeting or any special meeting of the Trustees called
for such purpose. In addition, any officer or
agent appointed in accordance with the provision
of Section 4.09 hereof may be removed, either
with or without cause, by any officer upon whom
such power of removal shall have been conferred
by the Trustees.
Section 4.14. Vacancies and Newly Created Offices:
If any vacancy shall occur in any
office by reason of death, resignation, removal,
disqualification or other cause, or if any new
office shall be created, such vacancies or newly
created offices may be filled by the Trustees at
any regular or special meeting of the Trustees or,
in the case of any office created pursuant to
Section 4.09 hereof, by any officer upon whom
such power shall have been conferred by the
Trustees.
ARTICLE V
CUSTODIAN
Section 5.01. Employment of Custodian: The Trustees
shall at all times employ one
or more banks or trust companies organized
under the laws of the U.S. or one of the states
thereof provided that each such bank or trust
company has capital, surplus and undivided profits
of at least two million dollars ($2,000,000) as
custodian with authority as the Trust's agent, but
subject to such restrictions, limitations and other
requirements, if any, as may be contained in
these By-Laws:
(1) to hold the securities owned by the
Trust and deliver the same upon written
order, or oral order if confirmed
in writing, or order delivered by such
electromechanical or electronic devices
as are agreed to by the Trust and the
custodian, if such procedures have been
authorized in writing by the Trust;
(2) to receive and give receipt for any moneys
due to the Trust and deposit the
same in its own banking department or
elsewhere as the Trustees may direct;
and
(3) to disburse such moneys upon orders or vouchers;
and the Trust may also enjoy such custodian as its agent:
(1) to keep the books and accounts of the Trust
and furnish clerical and accounting services; and
(2) to compute, if authorized to do so by the
Trustees, the Net Asset Value of
any Series or Class (which terms are
defined in the Declaration of Trust) in
accordance with the provisions of the
Declaration of Trust;
all upon such basis of compensation as may be
agreed upon between the Trustees and the
custodian. If so directed by a vote of
a majority of the outstanding shares of the Trust entitled
to vote, the custodian shall deliver and pay
over all property of the Trust held by it as specified
in such vote.
The Trustees may also authorize the
custodian to employ one or more sub-custodians
from time to time to perform such of the acts
and services of the custodian, and upon such terms
and conditions, as may be agreed upon between
the custodian and such sub-custodian and
approved by the Trustees, provided that
in every case such sub-custodian shall be a bank or trust
company organized under the laws of the United States
or one of the states thereof and having
capital, surplus and undivided profits of
at least two million dollars ($2,000,000) or such other
person as may be permitted by the Commission,
or otherwise in accordance with the 1940 Act.
Section 5.02. Use of Central Securities
Handling System: Subject to such rules,
regulations and orders as the Commission may adopt,
the Trustees may direct the custodian to
deposit any or all of the securities owned
by the Trust (1) in a system for the central handling
of securities established by a national securities
exchange or a national securities association
registered with the Commission under the
Securities Exchange Act of 1934, pursuant to which
system all securities of any particular class or
series of any issuer deposited within the system
are treated as fungible and may be transferred
or pledged by bookkeeping entry without physical
delivery of such securities, provided that all
such deposits shall be subject to withdrawal only
upon the order of the Trust; or (2) with such
other person as may be permitted by the
Commission, or otherwise in accordance with the 1940 Act.
ARTICLE VI
EXECUTION OF PAPERS
Section 6.01. General: Except as the Trustees
may generally or in particular cases
authorize the execution thereof in some other
manner, all deeds, leases, transfers, contracts,
bonds, notes, checks, drafts, and other
obligations made, accepted, or endorsed by the Trust
shall be executed by the president, any vice
president, or the treasurer, or by whomever else
shall be designated for that purpose by the
Trustees, and need not bear the seal of the Trust.
ARTICLE VII
SHARES OF BENEFICIAL INTEREST
Section 7.01. Share Certificates: No certificates
certifying the ownership of Shares
shall be issued except as the Trustees
may otherwise authorize. In the event that the Trustees
authorize the issuance of Share certificates,
subject to the provisions of Section 7.03, each
Shareholder shall be entitled to a certificate
stating the number of shares owned by him, in such
form as shall be prescribed from time to time
by the Trustees. Such certificate shall be signed
by the president or a vice president and by the
treasurer, assistant treasurer, secretary or
assistant secretary. Such signatures may
be facsimiles if the certificate is signed by a transfer
or shareholder services agent or by a registrar,
other than a Trustee, officer or employee of the
Trust. In case any officer who has signed
or whose facsimile signature has been placed on such
certificate shall have ceased to be such officer
before such certificate is issued, it may be issued
by the Trust with the same effect as if he were s
uch officer at the time of its issue.
In lieu of issuing certificates for shares,
the Trustees, the transfer agent or shareholder
services agent may either issue receipts therefor
or may keep accounts upon the books of the
Trust for the record holders of such shares,
who shall in either case be deemed, for all purposes
hereunder, to be the holders of certificates
for such shares as if they had accepted such
certificates and shall be held to have expressly
assented and agreed to the terms hereof.
Section 7.02. Loss of Certificates: In the case
of the alleged loss or destruction or the
mutilation of a Share certificate, a duplicate
certificate may be issued in place thereof, upon such
terms as the Trustees may prescribe.
Section 7.03. Discontinuance of Issuance of
Certificates: The Trustees may at any
time discontinue the issuance of Share certificates
and may, by written notice to each
Shareholder, require the surrender of Share
certificates to the Trust for cancellation. Such
surrender and cancellation shall not affect the
ownership of Shares in the Trust.
Section 7.04. Equitable Interest Not Recognized:
The Trust shall be entitled to treat
the holder of record of any Share or Shares of
the Trust as the holder in fact thereof, and shall
not be bound to recognize any equitable or other
claim of interest in such Share or Shares on
the part of any other person except as may
be otherwise expressly provided by law.
Section 7.05. Transfer of Shares:
The Shares of the Trust shall be transferable only
by transfer recorded on the books of the Trust,
in person or by attorney.
ARTICLE VIII
FISCAL YEAR; ACCOUNTANT
Section 8.01. Fiscal Year: The fiscal year
of the Trust shall end on such date in each
year as the Trustees shall from time to time
determine.
Section 8.02. Accountant:
(a) The Trust shall employ an independent
public accountant or firm of independent
public accountants as its accountant to examine
the accounts of the Trust and to sign and certify
the financial statements of the Trust.
The accountant's certificates and reports shall be addressed
both to the Trustees and to the Shareholders of the Trust.
(b) Any vacancy occurring due to the death
or resignation of the accountant may be
filled by a majority vote of the Trustees who
are not interested persons of the Trust.
ARTICLE IX
INSURANCE
Section 9.01. Insurance of Officers, Trustees,
and Employees: The Trust may
purchase and maintain insurance on behalf of
any person who is or was a Trustee, officer or
employee of the Trust, or is or was serving at
the request of the Trust as a Trustee, officer or
employee of a corporation, partnership, joint
venture, trust or other enterprise against any
liability asserted against him and incurred by
him in any such capacity or arising out of his status
as such, whether or not the Trust would have
the power to indemnify him against such liability.
The Trust may not acquire or obtain a contract
for insurance that protects or purports
to protect any Trustee or officer of the Trust
against any liability to the Trust or its Shareholders
to which he would otherwise be subject by reason of
willful misfeasance, bad faith, gross
negligence, or reckless disregard of the duties
involved in the conduct of his office.
ARTICLE X
AMENDMENTS; REPORTS; MISCELLANEOUS
Section 10.1. Amendments: These By-Laws may
be amended or repealed, in whole
or in part, by a majority of the Trustees then
in office at any meeting of the Trustees, or by one
or more writings signed by such majority.
Section 10.2. Reports: The Trustees shall at
least semiannually submit to the
Shareholders a written report of the transactions
of the Trust, including financial statements that
shall at least annually be certified by
independent public accountants.
Section 10.3. Gender: As used in these By-Laws,
the masculine gender shall include
the feminine and neuter genders.
Section 10.3. Headings: Headings are placed in
these bylaws for convenience of
reference only and in case of any conflict,
the text of these By-Laws rather than the headings
shall control.
Section 10.4. Inspection of Books: The Trustees
shall from time to time determine
whether and to what extent, and at what times
and places, and under what conditions and
regulations the accounts and books of the
Trust or any of them shall be open to the inspection
of the Shareholders, and no Shareholder shall have
any right to inspect any account or book or
document of the Trust except as conferred by
law or otherwise by the Trustees.
<PAGE>
FORM 10f-3 FUND: New York Tax-Free Income
Fund
Record of Securities Purchased Under the Fund's Rule
10f-3 Procedures
1. Issuer: NYC TFA
2. Date of Purchase: 10-2-97 3. Date offering commenced:
10-1-97
4. Underwriters from whom purchased: Lehman Brothers
5. "Affiliated Underwriter" managing or participating in
syndicate: PaineWebber
6. Aggregate principal amount of purchase: 500M
7. Aggregate principal amount of offering: 650MM
8. Purchase price (net of fees and expenses): 94.372
9. Initial public offering price: 94.372
10. Commission, spread or profit: % $ 5.00
11. Have the following conditions been
satisfied? YES NO
a. The securities are part of an issue
registered under the Securities Act of
1933 which is being offered to the public
or are "municipal securities" as defined
in Section 3(a)(29) of the Securities
Exchange Act of 1934. ____X___ ______
b. The securities were purchased
prior to the end of the end first full
business day of the offering at not
more than the initial offering price
(or, if a rights offering, , the securities
were purchased on or before the fourth
day preceding the day on which the
offering terminated. ___X___ ______
c. The underwriting was a firm
commitment underwriting. ___X___ _______
d. The commission, spread or profit
was reasonable and fair in relation to
that being received by others for
underwriting similar securities during
the same period. ____X___ _______
e. (1) If securities are registered
under the Securities Act of 1933, the
issuer of the securities and its
predecessor have been in continuous
operation for not less than three years. ____X___ _____
(2) If securities are municipal
securities, the issue of
securities has received an investment
grade rating from a nationally
recognized statistical rating
organization or, if the issuer or
entity supplying the revenues from
which the issue is to be paid shall
have been in continuous operation
for less than three years (including
any predecessor), the issue has
received one of the three highest
ratings from at least one such rating
organization. ____X___ _______
f. The amount of such securities purchased
by all of the investment companies advised by
Mitchell Hutchins did not exceed 4%
of the principal amount of the offering
or $500,000 in principal amount,
whichever is greater, provided that
in no event did such amount
exceed 10% of the principal amount
of the offering. ____X___ _______
g. The purchase price was less than 3%
of the Fund's total assets. ____X___ _______
h. No Affiliated Underwriter was a
direct or indirect participant in or
beneficiary of the sale or, with
respect to municipal securities, no
purchases were designated as group
sales or otherwise allocated to the
account of any Affiliated Underwriter. ____X___ _______
Approved: Richard S. Murphy Date: October 7, 1997
