Exhibit A(13)
FREMONT MUTUAL FUNDS, INC.
ARTICLES SUPPLEMENTARY
Fremont Mutual Funds, Inc., a Maryland corporation, having its principal
office in Baltimore, Maryland (hereinafter called the "Corporation"), hereby
certifies to the State Department of Assessments and Taxation of Maryland that:
FIRST: Pursuant to authority expressly vested in the Board of Directors of
the Corporation by Article FIFTH of the Charter of the Corporation, the Board of
Directors has duly classified 100,000,000 shares of the unissued shares of
capital stock of the Corporation into a series designated the Fremont New Era
Value Fund (the "New Era Value Fund") and has provided for the issuance of such
series. The Board of Directors of the Corporation may from time to time increase
or decrease the number of shares of capital stock so classified. All such shares
are initially classified as "Class A Common Stock" of the New Era Value Fund.
The Board of Directors may classify or reclassify any unissued shares of capital
stock of the New Era Value Fund (whether or not such shares have been previously
classified or reclassified) from time to time by setting or changing in any one
or more respects the preferences, conversion or other rights, voting powers,
restrictions, limitations as to dividends, qualifications, or terms or
conditions of redemption of such shares of stock.
SECOND: A description of the preferences, conversion and other rights,
voting powers, restrictions, limitations as to dividends, qualifications and
terms and conditions of redemption of the New Era Value Fund is as follows:
(1) ASSETS BELONGING TO THE NEW ERA VALUE FUND SERIES. All consideration
received by the Corporation from the issue or sale of shares of the New Era
Value Fund, together with all assets in which such consideration is invested or
reinvested, all income, earnings, profits, and proceeds thereof, including any
proceeds derived from the sale, exchange or liquidation of such assets, and any
funds or payments derived from any reinvestment of such proceeds in whatever
form the same may be, shall irrevocably belong to the New Era Value Fund for all
purposes, subject only to the rights of creditors, and shall be so recorded upon
the books of account of the Corporation. Such consideration, assets, 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,
together with any General Items allocated to the New Era Value Fund as provided
in the following sentence, are herein referred to as "assets belonging to" the
New Era Value Fund. If there are any assets, income, earnings, profits, and
proceeds thereof, funds, or payments which are not readily identifiable as
belonging to any particular class or series (collectively "General Items"), such
General Items shall be allocated by or under the supervision of the Board of
Directors to the New Era Value Fund in such manner and on such basis as the
Board of Directors, in its sole discretion, deems fair and equitable; and any
General Items so allocated to the New Era Value Fund shall belong to that
series. Each such allocation by the Board of Directors shall be conclusive and
binding for all purposes.
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(2) LIABILITIES OF THE NEW ERA VALUE FUND SERIES. The assets belonging to
the New Era Value Fund shall be charged with the liabilities of the Corporation
in respect of that series and all expenses, costs, charges and reserves
attributable to that series, and any general liabilities, expenses, costs,
charges or reserves of the Corporation which are not readily identifiable as
belonging to any particular class or series shall be allocated and charged by or
under the supervision of the Board of Directors to the New Era Value Fund in
such manner and on such basis as the Board of Directors, in its sole discretion,
deems fair and equitable. The liabilities, expenses, costs, charges and reserves
allocated and so charged to the New Era Value Fund are herein referred to as
"liabilities belonging to" that series. Each allocation of liabilities,
expenses, costs, charges and reserves by the Board of Directors shall be
conclusive and binding for all purposes.
(3) INCOME BELONGING TO THE NEW ERA VALUE FUND SERIES. The Board of
Directors shall have full discretion, to the extent not inconsistent with the
Maryland General Corporation Law and the Investment Company Act of 1940, as
amended (the "1940 Act"), to determine which items shall be treated as income
and which items as capital; and each such determination and allocation shall be
conclusive and binding.
Income belonging to the New Era Value Fund includes all income, earnings
and profits derived from assets belonging to the New Era Value Fund less any
expenses, costs, charges or reserves belonging to the New Era Value Fund for the
relevant time period, all determined in accordance with generally accepted
accounting principles.
(4) DIVIDENDS AND DISTRIBUTIONS. Dividends and distributions on shares of
the New Era Value Fund may be paid with such frequency, in such form and in such
amount as the Board of Directors may from time to time determine. Dividends may
be daily or otherwise pursuant to a standing resolution or resolutions adopted
only once or with such frequency as the Board of Directors may determine, after
providing for actual and accrued liabilities belonging to the New Era Value
Fund.
All dividends on shares of the New Era Value Fund shall be paid only out of
the income belonging to the New Era Value Fund and capital gains distributions
on shares of the New Era Value Fund shall be paid only out of the capital gains
belonging to the New Era Value Fund. Subject to subsection (12) below, all
dividends and distributions on shares of the New Era Value Fund shall be
distributed pro rata to the holders of the New Era Value Fund in proportion to
the number of shares of the New Era Value Fund held by such holders at the date
and time of record established for the payment of such dividends or
distributions, except that in connection with any dividend or distribution
program or procedure, the Board of Directors may determine that no dividend or
distribution shall be payable on shares as to which the Shareholder's purchase
order and/or payment have not been received by the time or times established by
the Board of Directors under such program or procedure.
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The New Era Value Fund intends to qualify as a "regulated investment
company" under the Internal Revenue Code of 1986, as amended, or any successor
or comparable statute thereto, and regulations promulgated thereunder. Inasmuch
as the computation of net income and gains for federal income tax purposes may
vary from the computation thereof on the books of the New Era Value Fund, the
Board of Directors shall have the power, in its sole discretion, to distribute
in any fiscal year as dividends, including dividends designated in whole or in
part as capital gains distributions, amounts sufficient, in the opinion of the
Board of Directors, to enable the New Era Value Fund to qualify as a regulated
investment company and to avoid liability of the New Era Value Fund for federal
income tax in respect of that year. However, nothing in the foregoing shall
limit the authority of the Board of Directors to make distributions greater than
or less than the amount necessary to qualify as a regulated investment company
and to avoid liability of the New Era Value Fund for such tax.
Dividends and distributions may be made in cash, property or additional
shares of the New Era Value Fund or another class or series, or a combination
thereof, as determined by the Board of Directors or pursuant to any program that
the Board of Directors may have in effect at the time for the election by each
Shareholder of the mode of the making of such dividend or distribution to that
Shareholder. Any such dividend or distribution paid in shares will be paid at
the net asset value thereof as defined in subsection (9) below.
(5) LIQUIDATION. In the event of the liquidation or dissolution of the
Corporation, the shareholders of the New Era Value Fund shall be entitled to
receive, as a series and in preference to any other series, when and as declared
by the Board of Directors, the excess of the assets belonging to the New Era
Value Fund over the liabilities belonging to that series and such shareholders
shall not be entitled thereby to any distribution upon liquidation of any other
class or series. The assets so distributable to the shareholders of the New Era
Value Fund shall be distributed among such shareholders in proportion to the
number of shares of that series held by them and recorded on the books of the
Corporation. The liquidation of the New Era Value Fund may be authorized by vote
of a majority of the Board of Directors then in office, subject to the approval
of a majority of the outstanding securities of that series, as defined in the
1940 Act, and without the vote of the holders of any other class or series. The
liquidation or dissolution of the New Era Value Fund may be accomplished, in
whole or in part, by the transfer of assets of such series to another class or
series or by the exchange of shares of such series for the shares of another
class or series.
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(6) VOTING. On each matter submitted to a vote of the shareholders of the
Corporation, each holder of a share of the New Era Value Fund shall be entitled
to one vote for each share of the New Era Value Fund standing in his name on the
books of the Corporation, and all shares of all classes or series shall vote as
a single class or series ("Single Class Voting"); provided, however, that (a) as
to any matter with respect to which a separate vote of the New Era Value Fund or
of any class or classes thereof is required by the 1940 Act or by the Maryland
General Corporation Law (including, without limitation, approval of any plan,
agreement or other arrangement referred to in subsection (12)(b)(iii) below),
such requirement as to a separate vote by the New Era Value Fund or of any class
or classes thereof shall apply in lieu of Single Class Voting as described
above; (b) in the event that the separate vote requirements referred to in (a)
above apply with respect to one or more classes of series, then, subject to (c)
below, the shares of all other classes or series shall vote as a single class or
series; and (c) as to any matter which does not affect the interest of the New
Era Value Fund, or of any class or classes thereof, the holders of shares of the
New Era Value Fund, or of any class or classes thereof, as the case may be,
shall not be entitled to vote. As to any matter with respect to which a separate
vote of the New Era Value Fund is required pursuant to proviso (a) above,
notwithstanding any provision of law requiring any action on that matter to be
taken or authorized by the holders of a greater proportion than a majority of
the New Era Value Fund entitled to vote thereon, such action shall be valid and
effective if taken or authorized by the affirmative vote of the holders of a
majority of shares of the New Era Value Fund outstanding and entitled to vote
thereon.
(7) REDEMPTION BY SHAREHOLDER. Each holder of shares of the New Era Value
Fund shall have the right at such times as may be permitted by the Corporation,
but no less frequently than once each week, to require the Corporation to redeem
all or any part of his shares of the New Era Value Fund at a redemption price
per share equal to the net asset value per share of the New Era Value Fund next
determined (in accordance with subsection (9)) after the Shares are properly
tendered for redemption, less such redemption charge (which may, but is not
required to be, the same for the shares of each class of the New Era Value Fund)
as is determined by the Board of Directors. Payment of the redemption price
shall be in cash; provided, however, that if the Board of Directors determines,
which determination shall be conclusive, that conditions exist which make
payment wholly in cash unwise or undesirable, the Corporation may make payment
wholly or partly in securities or other assets belonging to the New Era Value
Fund at the value of such securities or assets used in such determination of net
asset value.
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Notwithstanding the foregoing, the Corporation may postpone payment of the
redemption price and may suspend the right of the holders of shares of the New
Era Value Fund to require the Corporation to redeem shares of that series during
any period or at any time when and to the extent permissible under the 1940 Act.
(8) REDEMPTION BY CORPORATION. The Board of Directors may cause the
Corporation to redeem at net asset value the shares of the New Era Value Fund
from a holder who has had shares of that series having an aggregate net asset
value (determined in accordance with subsection (9)) of an amount equal to $100
less than the minimum initial investment in or less in his account, provided
that at least sixty (60) days' prior written notice of the proposed redemption
has been given to such holder by postage paid mail to his last known address.
Upon redemption of such shares pursuant to this subsection, the Corporation
shall promptly cause payment of the full redemption price to be made to the
holder of such shares so redeemed.
(9) NET ASSET VALUE PER SHARE. Subject to subsection (12) below, the net
asset value per share of the New Era Value Fund shall be the quotient obtained
by dividing the value of the net assets of that series (being the value of the
assets belonging to that series less the liabilities belonging to that series)
by the total number of shares of the New Era Value Fund outstanding, all
determined by the Board of Directors in accordance with generally accepted
accounting principles and not inconsistent with the 1940 Act.
The Board of Directors may determine to maintain the net asset value per
share of the New Era Value Fund at a designated constant dollar amount and in
connection therewith may adopt procedures not inconsistent with the 1940 Act for
the continuing declarations of income attributable to that series as dividends
payable in additional shares of the New Era Value Fund at the designated
constant dollar amount and for the handling of any losses attributable to that
series. Such procedures may provide that in the event of any loss, each
shareholder shall be deemed to have contributed to the capital of the
Corporation attributable to the New Era Value Fund his pro rata portion of the
total number of shares required to be canceled in order to permit the net asset
value per share of the New Era Value Fund to be maintained, after reflecting
such loss, at the designated constant dollar amount. Each shareholder of the New
Era Value Fund shall be deemed to have agreed, by his investment in such series,
to make the contribution referred to in the preceding sentence in the event of
any such loss.
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(10) EQUALITY. Subject to subsection (12) below, all shares of the New Era
Value Fund shall represent an equal proportionate interest in the assets
belonging to the New Era Value Fund (subject to the liabilities belonging to
that series), and each share of the New Era Value Fund shall be equal to each
other share of that series. The Board of Directors may from time to time divide
or combine the shares of the New Era Value Fund, or any class or classes
thereof, into a greater or lesser number of shares of the New Era Value Fund or
any class or classes thereof, as the case may be, without thereby changing the
proportionate beneficial interest in the assets belonging to the New Era Value
Fund or in any way affecting the rights of shares of the New Era Value Fund, or
any class thereof.
(11) CONVERSION OR EXCHANGE RIGHTS. Subject to compliance with the
requirements of the 1940 Act, the Board of Directors shall have the authority to
provide that holders of shares of the New Era Value Fund shall have the right to
convert or exchange said shares into shares of one or more other classes or
series of shares in accordance with such requirements and procedures as may be
established by the Board of Directors.
(12) DESIGNATION OF CLASSES.
(a) The New Era Value Fund of Common Stock may have such number of
classes of Common Stock as shall be designated by the Board of Directors from
time to time. Any class of Common Stock of the New Era Value Fund shall be
referred to herein individually as a "Class" and collectively, together with any
further class or classes of such Series from time to time established, as the
"Classes." Each Class shall consist of, until further changed, such number of
shares as shall be designated by the Board of Directors from time to time,
provided that the total number of shares of all Classes of the New Era Value
Fund shall not exceed the number of shares classified from time to time as
capital stock of the New Era Value Fund. All such shares are initially
classified as Class A Common Stock of the New Era Value Fund. Designations of
shares among the Classes by the Board of Directors shall be effectuated through
the filing from time to time of articles supplementary to the Corporation's
Charter.
(b) All Classes of the New Era Value Fund shall represent the same
interest in the Corporation and have identical voting, dividend, liquidation,
and other rights with any other shares of Common Stock of that Series; provided,
however, that notwithstanding anything in the Charter of the Corporation or
these Articles Supplementary to the contrary:
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(i) The shares of Class A Common Stock shall be sold without front-end
sales loads; provided, however, if no other Class is at that time
established, that the Board of Directors may in its discretion authorize
the sale of Class A Common Stock with fro sales loads, contingent deferred
sales charges or such other sales or redemption charge arrangements as are
in accordance with the 1940 Act and applicable rules and regulations (if
any) of NASD Regulation, Inc. ("NASDR").
(ii) Articles supplementary hereafter adopted by the Board of Directors in
connection with the designation of any additional Classes may provide that
shares of each additional Class may be subject to such no-load
arrangements, front-end sales loads, contingent deferred sales charges or
such other sales or redemption charge arrangements as may be established
from time to time by the Board of Directors in accordance with the 1940 Act
and applicable rules and regulations (if any) of NASDR.
(iii) Expenses related solely to a particular Class (including, without
limitation, distribution expenses under a 1940 Act Rule 12b-1 plan and
administrative expenses under an administration or service agreement, plan
or other arrangement, however designated) shall be borne by that Class and
shall be appropriately reflected (in the manner determined by the Board of
Directors) in the net asset value, dividends, distribution and liquidation
rights of the shares of that Class.
(iv) Articles supplementary hereafter adopted by the Board of Directors in
connection with the designation of any additional Classes may provide that
on an anniversary (as designated in such articles supplementary) of the
first business day of the month following the month in which shares of a
Class were purchased by a stockholder, such shares (as well as a pro rata
portion of any shares purchased through the reinvestment of dividends and
other distributions paid in respect of all shares of that Class held by
such stockholder) may automatically convert to shares of Class A Common
Stock or any other Class as may be designated in the articles
supplementary; provided, however, that such conversion may be subject to
the continuing availability of an opinion of counsel to the effect that the
conversion of the shares of that Class does not constitute a taxable event
under federal income tax law. The Board of Directors, in its sole
discretion, may suspend the conversion of shares of that Class if such
opinion is no longer available.
(13) Fractional Shares. The Corporation may issue and sell fractions of
shares of the New Era Value Fund, or any class or classes thereof, having pro
rata all the rights of full shares of the New Era Value Fund, or any class
thereof, including, without limitation, the right to vote and to receive
dividends, and wherever the words "share" or "shares" are used in the Articles
or in the By-Laws, they shall be deemed to include fractions of shares of the
New Era Value Fund, or any class or classes thereof, as the case may be, where
the context does not clearly indicate that only full shares are intended.
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(14) Stock Certificates. The Corporation shall not be obligated to issue
certificates representing shares of the New Era Value Fund, or any class or
classes thereof, unless it shall receive a written request therefor from the
record holder thereof in accordance with procedures established in the Bylaws or
by the Board of Directors.
IN WITNESS WHEREOF, Fremont Mutual Funds, Inc., has caused these presents
to be signed in its name and on its behalf by its President and witnessed by its
Secretary on September 26, 2000.
FREMONT MUTUAL FUNDS, INC.
WITNESS:
By:
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Tina Thomas, Michael H. Kosich,
Secretary President
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THE UNDERSIGNED, President of Fremont Mutual Funds, Inc., who executed on
behalf of the Corporation Articles Supplementary of which this Certificate is
made a part, hereby acknowledges in the name and on behalf of said Corporation
the foregoing Articles Supplementary to be the corporate act of said Corporation
and hereby certifies that the matters and facts set forth herein with respect to
the authorization and approval thereof are true in all material respects under
the penalties of perjury.
----------------------------
Michael H. Kosich,
President
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