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SIGNATURE MICHAEL A. PIGNATARO
TITLE CFO
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000854580
<NAME> THE PORTUGAL FUND, INC.
<S> <C>
<PERIOD-TYPE> 12-MOS
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<PERIOD-START> JAN-01-1999
<PERIOD-END> DEC-31-1999
<INVESTMENTS-AT-COST> 71296006
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</TABLE>
Report of Independent Accountants
To the Board of Directors and Shareholders
of The Portugal Fund, Inc.
In planning and performing our audit of the financial statements of
The Portugal Fund, Inc (the Company) for the year ended December
31, 1999, we considered its internal control, including control
activities for safeguarding securities, in order to determine our
auditing procedures for the purpose of expressing our opinion on
the financial statements and to comply with the requirements of
Form N-SAR, not to provide assurance on internal control.
The management of the Company 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 entitys
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 controls may become inadequate because of changes
in conditions or that the effectiveness of their design and
operation may deteriorate.
Our consideration of internal control would not necessarily
disclose all matters in internal control that might be material
weaknesses under standards established by the American Institute
of Certified Public Accountants. A material weakness is a condition
in which the design or operation of one or more of the internal
control components does not reduce to a relatively low level the risk
that misstatements caused by error or fraud in amounts that would be
material in relation to the financial statements being audited may
occur and not be detected within a timely period by employees in the
normal course of performing their assigned functions. However, we
noted no matters involving internal control and its operation,
including controls for safeguarding securities, that we consider to
be material weaknesses as defined above as of December 31, 1999.
This report is intended solely for the information and use of the
Board of Directors, management and the Securities and Exchange
Commission and is not intended to be and should not be used by
anyone other than these specified parties.
PricewaterhouseCoopers LLP
2400 Eleven Penn Center
Philadelphia, PA
February 15, 2000
RESULTS OF ANNUAL MEETING OF SHAREHOLDERS (UNAUDITED)
On October 15, 1999, the annual meeting of shareholders
(the "Meeting") of The Portugal Fund, Inc. (the "Fund")
was held and the following matters were voted upon:
At the Meeting, the votes cast for, against and abstaining from
voting with respect to Proposal 1(a) to convert the
Fund from a closed-end investment company to an open-end investment
company, and to amend and restate the
Fund's Articles of Incorporation to provide for such conversion, were
as follows:
For Against Abstain Non-Votes
825,500 1,664,171 637,540 2,201,105
At the Meeting, the votes cast for, against and abstaining from
voting with respect to Proposal 1(b) to change the
Fund's fundamental investment policy relating to borrowing to reflect
its proposed new subclassification as an open-end
investment company were as follows:
For Against Abstain Non-Votes
800,930 1,659,406 666,765 2,201,215
Proposals 1(a) and 1(b) did not receive the requisite vote for
approval.
At the Meeting, the votes cast on Proposal 2(a) to elect tw
o Directors of the Fund for a three year term in the event
that Proposal 1(a) is not approved were as follows:
Nominee For Withheld Non-Votes
J.J. Cattano 451,698 45,664 4,830,954
R.W. Watt 451,876 45,486 4,830,954
R.G. Olin 2,616,897 12,848 2,698,571
R. W. Bradshaw 2,616,697 13,048 2,698,571
As Messrs. Olin and Bradshaw received a plurality of the votes cast,
they were elected as directors of the Fund.
At the Meeting, the votes cast for, against and abstaining from
voting on Proposal 3-the ratification of the
selection of PricewaterhouseCoopers LLP as the Fund's independent
public accountants for the fiscal year ending
December 31, 1999-were as follows:
For Against Abstain Non-Votes
2,925,304 27,077 174,722 2,201,215
Shareholders presented a number of additional proposals for
consideration that had not been included in any
proxy statement circulated prior to the meeting. The proposals, and
the votes for, against and abstaining from
voting on such proposals were as follows: Proposal 5(a)-"Any bylaw(s)
providing that in order to bring business
before a meeting of Stockholders or to nominate a person for election
as a Director, a shareholder must notify the
Secretary of the Fund prior to the meeting, shall be repealed"
For Against Abstain Non-Votes
48,300 3,078,924 -0- 2,201,092
Proposal 5(b)-"Article 2.3 of the bylaws shall be amended by
inserting 'By any shareholder who has presented a
proposal that was approved at the Company's last annual meeting of
Stockholders,' after the words 'may be called'
in the first sentence"
For Against Abstain Non-Votes
48,300 3,078,924 -0- 2,201,092
Proposal 5(c)-"The following bylaw shall be adopted: 'As soon as
possible after the 1999 annual meeting of
Stockholders, the Company shall conduct a self-tender offer for the
maximum number of shares legally permitted at
a price not less that 99% of net asset value per share'"
For Against Abstain Non-Votes
48,300 3,078,924 -0- 2,201,092
None of these proposals, as well as other proposals that were
dependent upon approval of Proposal 5(c) received the
requisite vote of shareholders and thus were not adopted.
Proposal 6-"Resolved: That (i) the first sentence of Article 3.2 of
the Bylaws of the Fund be amended to read in its
entirety as follows: 'The Board of Directors shall consist of nine
(9) directors, and (ii) that the number of directors
be increased to nine (9)'"
For Against Abstain Non-Votes
2,628,562 451,662 -0- 2,248,092
Proposal 7-"Resolved: That the following persons be nominated to fill
the vacancies created by the increase in the
number of Directors for the terms set forth by their names"
Nominee For Withheld Term Non-Votes
William A. Clark 2,628,562 451,662 2000 2,248,092
Gary A. Bentz 2,628,562 451,662 2001 2,248,092
Glenn W. Wilcox, Sr. 2,628,562 451,662 2002 2,248,092
Proposal 8-"Resolved: That all bylaw amendments or restatements since
the original Bylaws of the Fund, in the form
attached to this ballot, be repealed; including, without limitation,
the Amended and Restated Bylaws of the Fund dated
April 21, 1999"
For Against Abstain Non-Votes
2,629,862 450,362 -0- 2,048,092
None of Proposals 6, 7 or 8 received the requisite vote for approval
by the shareholders.
CT Corporation System served as Inspector of Election at the Meeting.
AMENDED AND RESTATED
BYLAWS
OF
THE PORTUGAL FUND, INC.
BYLAW-ONE: NAME OF COMPANY, LOCATION OF OFFICES AND SEAL.
Article 1.1. Name. The name of the Company is The Portugal Fund,
Inc.
Article 1.2. Principal Offices. The principal office of the Company
in the State of Maryland shall be located in Baltimore, Maryland.
The Company may, in addition, establish and maintain such other
offices and places of business within or outside the State of
Maryland as the Board of Directors may from time to time determine.
Article 1.3. Seal. The corporate seal of the Company shall be
circular in form and shall bear the name of the Company, the year
of its incorporation and the words "Corporate Seal, Maryland." The
form of the seal shall be subject to alteration by the Board of
Directors 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 Director of the Company shall have authority to affix
the corporate seal of the Company to any document requiring the same.
BYLAW-TWO: STOCKHOLDERS.
Article 2.1. Place of Meetings. All meetings of the Stockholders
shall be held at such place within the United States, whether within
or outside the State of Maryland, as the Board of Directors shall
determine, which shall be stated in the notice of the meeting or in
a duly executed waiver of notice thereof.
Article 2.2. Annual Meeting. Commencing in 1990, the annual meeting
of the Stockholders of the Company shall be held at such place as the
Board of Directors shall select on such date, during the 31-day
period ending four months after the end of the Company's fiscal
year, as may be fixed by the Board of Directors each year, at which
time the Stockholders shall elect Directors by plurality vote, and
transact such other business as may properly come before the meeting.
Any business of the Company may be transacted at the annual meeting
without being specially designated in the notice except as otherwise
provided by statute, by the Articles of Incorporation or by these
Bylaws.
Article 2.3. Special Meetings. Special meetings of the Stockholders
for any purpose or purposes, unless otherwise prescribed by statute
or by the Articles of Incorporation, may be called by resolution of
the Board of Directors or by the President, and shall be called by
the Secretary at the request, in writing, of a majority of the Board
of Directors or at the request, in writing, of Stockholders owning at
least 25% of the votes entitled to be cast at the meeting upon payment
by such Stockholders to the Corporation of the reasonably estimated
cost of preparing and mailing a notice of the meeting (which
estimated cost shall be provided to such Stockholders by the
Secretary of the Corporation). Notwithstanding the foregoing, unless
requested by Stockholders entitled to cast a majority of the votes
entitled to be cast at the meeting, a special meeting of the
Stockholders need not be called at the request of Stockholders to
consider any matter that is substantially the same as a matter voted
on at any special meeting of the Stockholders held during the
preceding 12 months. A written request shall state the purpose or
purposes of the proposed meeting.
Article 2.4. Notice. Written notice of every meeting of
Stockholders, stating the purpose or purposes for which the meeting
is called, the time when and the place where it is to be held, shall
be served, either personally or by mail, not less than ten nor more
than ninety days before the meeting, upon each Stockholder as of the
record date fixed for the meeting who is entitled to vote at such
meeting. If mailed (1) such notice shall be directed to a
Stockholder at his address as it shall appear on the books of the
Company (unless he shall have filed with the Transfer Agent of the
Company a written request that notices intended for him be mailed to
some other address, in which case it shall be mailed to the address
designated in such request) and (2) such notice shall be deemed to
have been given as of the date when it is deposited in the United
States mail with first-class postage thereon prepaid.
Article 2.5. Notice of Stockholder Business. At any annual or
special meeting of the stockholders, only such business shall be
conducted as shall have been properly brought before the meeting.
To be properly brought before an annual or special meeting, the
business must be (i) specified in the notice of meeting (or any
supplement thereto) given by or at the direction of the Board of
Directors, (ii) otherwise properly brought before the meeting by or
at the direction of the Board of Directors, or (iii) otherwise
properly brought before the meeting by a Stockholder.
For business to be properly brought before an annual or special
meeting by a Stockholder, the Stockholder must have given timely
notice thereof in writing to the Secretary of the Corporation. To be
timely, any such notice must be delivered to or mailed and received
at the principal executive offices of the Corporation not later than
60 days prior to the date of the meeting; provided, however, that if
less than 70 days' notice or prior public disclosure of the date of
the meeting is given or made to Stockholders, any such notice by a
Stockholder to be timely must be so received not later than the close
of business on the 10th day following the day on which notice of the
date of the annual or special meeting was given or such public
disclosure was made.
Any such notice by a Stockholder shall set forth as to each matter
the Stockholder proposes to bring before the annual or special
meeting (i) a brief description of the business desired to be brought
before the annual or special meeting and the reasons for conducting
such business at the annual or special meeting, (ii) the name and
address, as they appear on the Corporation's books, of the
Stockholder proposing such business, (iii) the class and number of
shares of the capital stock of the Corporation which are
beneficially owned by the Stockholder, and (iv) any material interest
of the Stockholder in such business.
Notwithstanding anything in the Bylaws to the contrary, no business
shall be conducted at any annual or special meeting except in
accordance with the procedures set forth in this Article 2.5. The
chairman of the annual or special meeting shall, if the facts
warrant, determine and declare to the meeting that business was not
properly brought before the meeting and in accordance with the
provisions of this Article 2.5, and if he should so determine, he
shall so declare to the meeting that any such business not properly
brought before the meeting shall not be considered or transacted.
Article 2.6. Quorum. The holders of a majority of the stock issued
and outstanding and entitled to vote, present in person or represented
by proxy, shall be requisite and shall constitute a quorum at all
meetings of the Stockholders for the transaction of business except
as otherwise provided by statute, by the Articles of Incorporation or
by these Bylaws. If a quorum shall not be present or represented,
the Stockholders entitled to vote thereat, present in person or
represented by proxy, shall have the power to adjourn the meeting
from time to time, without notice other than announcement at the
meeting, to a date not more than 120 days after the original record
date, until a quorum shall be present or represented. At such
adjourned meeting, at which a quorum shall be present or represented,
any business which might have been transacted at the original meeting
may be transacted.
Article 2.7. Vote of the Meeting. When a quorum is present or
represented at any meeting, the vote of the holders of a majority of
votes cast shall decide any question brought before such meeting
(except with respect to election of directors which shall be by a
plurality of votes cast), unless the question is one upon which, by
express provisions of applicable statutes, of the Articles of
Incorporation or of these Bylaws, a different vote is required, in
which case such express provision shall govern and control the
decision of such question.
Article 2.8. Voting Rights of Stockholders. Each Stockholder of
record having the right to vote shall be entitled at every meeting
of the Stockholders of the Company to one vote for each share of
stock having voting power standing in the name of such Stockholder
on the books of the Company on the record date fixed in accordance
with Article 6.5 of these Bylaws, with pro rata voting rights for any
fractional shares, and such votes may be cast either in person or by
written proxy.
Article 2.9. Organization. At every meeting of the Stockholders,
the Chairman of the Board, or in his absence or inability to act, the
Vice Chairman of the Board, or in his absence or inability to act, a
chairman chosen by the Stockholders, shall act as chairman of the
meeting. The Secretary, or in his absence or inability to act, a
person appointed by the chairman of the meeting, shall act as
secretary of the meeting and keep the minutes of the meeting.
Article 2.10. Proxies. Every proxy must be executed in writing by
the Stockholder or by his duly authorized attorney-in-fact. No proxy
shall be valid after the expiration of eleven months from the date of
its execution unless it shall have specified therein its duration.
Every proxy shall be revocable at the pleasure of the person
executing it or of his personal representatives or assigns. Proxies
shall be delivered prior to the meeting to the Secretary of the
Company or to the person acting as Secretary of the meeting before
being voted. A proxy with respect to stock 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 Company receives a specific
written notice to the contrary from any one of them. A proxy
purporting to be executed by or on behalf of a Stockholder shall be
deemed valid unless challenged at or prior to its exercise.
Article 2.11. Stock Ledger and List of Stockholders. It shall be
the duty of the Secretary or Assistant Secretary of the Company to
cause an original or duplicate stock ledger to be maintained at the
office of the Company's transfer agent.
Article 2.12. Action without Meeting. Any action to be taken by
Stockholders may be taken without a meeting if (1) all Stockholders
entitled to vote on the matter consent to the action in writing, (2)
all Stockholders entitled to notice of the meeting but not entitled
to vote at it sign a written waiver of any right to dissent and (3)
said consents and waivers are filed with the records of the meetings
of Stockholders. Such consent shall be treated for all purposes as a
vote at a meeting.
BYLAW-THREE: BOARD OF DIRECTORS.
Article 3.1. General Powers. Except as otherwise provided in the
Articles of Incorporation, the business and affairs of the
Corporation shall be managed under the direction of the Board of
Directors. All powers of the Corporation may be exercised by or
under authority of the Board of Directors except as conferred on or
reserved to the Stockholders by law, by the Articles of Incorporation
or by these Bylaws.
Article 3.2. Board of Three to Nine Directors. The Board of
Directors shall consist of not less than three (3) nor more than nine
(9) Directors; provided that if there are no shares of capital stock
outstanding, the number of Directors may be less than three but not
less than one. Directors need not be Stockholders. The Directors
shall have power from time to time, and at any time when the
Stockholders as such are not assembled in a meeting, regular or
special, to increase or decrease the number of Directors. If the
number of Directors is increased, the additional Directors may be
elected by a majority of the Directors in office at the time of the
increase. If such additional Directors are not so elected by the
Directors in office at the time they increase the number of places
on the Board, or if the additional Directors are elected by the
existing Directors prior to the first meeting of the Stockholders
of the Company, then in either of such events the additional
Directors shall be elected or reelected by the Stockholders at their
next annual meeting or at an earlier special meeting called for that
purpose.
Beginning with the first annual meeting of Stockholders held after
the initial public offering of the shares of the Company (the
"initial annual meeting"), the Board of Directors shall be divided
into three classes: Class I, Class II and Class III. The terms of
office of the classes of Directors elected at the initial annual
meeting shall expire at the times of the annual meetings of the
Stockholders as follows: Class I on the next annual meeting, Class
II on the second next annual meeting and Class III on the third next
annual meeting, or thereafter in each case when their respective
successors are elected and qualified. At each subsequent annual
election, the Directors chosen to succeed those whose terms are
expiring shall be identified as being of the same class as the
Directors whom they succeed, and shall be elected for a term expiring
at the time of the third succeeding annual meeting of Stockholders,
or thereafter in each case when their respective successors are
elected and qualified. The number of Directorships shall be
apportioned among the classes so as to maintain the classes as
nearly equal in number as possible.
Article 3.3. Director Nominations.
(a) Only persons who are nominated in accordance with the procedures
set forth in this Article 3.3 shall be eligible for election or
re-election as Directors. Nominations of persons for election or
re-election to the Board of Directors of the Corporation may be made
at a meeting of Stockholders by or at the direction of the Board of
Directors or by any Stockholder of the Corporation who is entitled
to vote for the election of such nominee at the meeting and who
complies with the notice procedures set forth in this Article 3.3.
(b) Such nominations, other than those made by or at the direction
of the Board of Directors, shall be made pursuant to timely notice
delivered in writing to the Secretary of the Corporation. To be
timely, any such notice by a Stockholder must be delivered to or
mailed and received at the principal executive offices of the
Corporation not later than 60 days prior to the meeting; provided,
however, that if less than 70 days' notice or prior public disclosure
of the date of the meeting is given or made to Stockholders, any
such notice by a Stockholder to be timely must be so received not
later than the close of business on the 10th day following the day
on which notice of the date of the meeting was given or such public
disclosure was made.
(c) Any such notice by a Stockholder shall set forth (i) as to each
person whom the Stockholder proposes to nominate for election or
re-election as a Director, (A) the name, age, business address and
residence address of such person, (B) the principal occupation or
employment of such person, (C) the class and number of shares of the
capital stock of the Corporation which are beneficially owned by such
person and (D) any other information relating to such person that is
required to be disclosed in solicitations of proxies for the election
of Directors pursuant to Regulation 14A under the Securities Exchange
Act of 1934 or any successor regulation thereto (including without
limitation such persons' written consent to being named in the proxy
statement as a nominee and to serving as a Director if elected and
whether any person intends to seek reimbursement from the Corporation
of the expenses of any solicitation of proxies should such person be
elected a Director of the Corporation); and (ii) as to the Stockholder
giving the notice (A) the name and address, as they appear on the
Corporation's books, of such Stockholder and (B) the class and number
of shares of the capital stock of the Corporation which are
beneficially owned by such Stockholder. At the request of the
Board of Directors any person nominated by the Board of Directors
for election as a Director shall furnish to the Secretary of the
Corporation that information required to be set forth in a
Stockholder's notice of nomination which pertains to the nominee.
(d) If a notice by a Stockholder is required to be given pursuant to
this Article 3.3, no person shall be entitled to receive
reimbursement from the Corporation of the expenses of a solicitation
of proxies for the election as a Director of a person named in such
notice unless such notice states that such reimbursement will be
sought from the Corporation. The Chairman of the meeting shall, if
the facts warrant, determine and declare to the meeting that a
nomination was not made in accordance with the procedures prescribed
by the Bylaws, and if he should so determine, he shall so declare to
the meeting and the defective nomination shall be disregarded for all
purposes.
Article 3.4. Vacancies. Subject to the provisions of the Investment
Company Act of 1940, as amended, if the office of any Director or
Directors becomes vacant for any reason (other than an increase in
the number of Directors), the Directors in office, although less than
a quorum, shall continue to act and may choose a successor or
successors, who shall hold office until the next election of
Directors, or any vacancy may be filled by the Stockholders at any
meeting thereof.
Article 3.5. Removal. At any meeting of Stockholders duly called and
at which a quorum is present, the Stockholders may, by the
affirmative vote of the holders of at least three-fourths of the
votes entitled to be cast thereon, remove any Director or Directors
from office, with or without cause, and may elect a successor or
successors to fill any resulting vacancies for the unexpired term
of the removed Director.
Article 3.6. Resignation. A Director may resign at any time by
giving written notice of his resignation to the Board of Directors
or the Chairman or the Vice Chairman of the Board or the Secretary of
the Corporation. Any resignation shall take effect at the time
specified in it or, should the time when it is to become effective
not be specified in it, immediately upon its receipt. Acceptance of
a resignation shall not be necessary to make it effective unless the
resignation states otherwise.
Article 3.7. Place of Meetings. The Directors may hold their
meetings at the principal office of the Company or at such other
places, either within or outside the State of Maryland, as they may
from time to time determine.
Article 3.8. Regular Meetings. Regular meetings of the Board may be
held at such date and time as shall from time to time be determined
by resolution of the Board.
Article 3.9. Special Meetings. Special meetings of the Board may be
called by order of the Chairman or Vice Chairman of the Board on one
day's notice given to each Director either in person or by mail,
telephone, telegram, cable or wireless to each Director at his
residence or regular place of business. Special meetings will be
called by the Chairman or Vice Chairman of the Board or Secretary in
a like manner on the written request of a majority of the Directors.
Article 3.10. Quorum. At all meetings of the Board, the presence of
one-third of the entire Board of Directors (but not less than two
Directors unless the Board of Directors shall consist of only one
Director in which event that one Director shall constitute a quorum)
shall be necessary to constitute a quorum and sufficient for the
transaction of business, and any act of a majority present at a
meeting at which there is a quorum shall be the act of the Board of
Directors, except as may be specifically provided by statute, by the
Articles of Incorporation or by these Bylaws. If a quorum shall not
be present at any meeting of Directors, the Directors present thereat
may adjourn the meeting from time to time, without notice other than
announcement at the meeting, until a quorum shall be present.
Article 3.11. Organization. The Board of Directors shall designate
one of its members to serve as Chairman of the Board and another of
its members to serve as Vice Chairman of the Board. The Chairman of
the Board shall preside at each meeting of the Board. In the absence
or inability of the Chairman of the Board to act, the Vice Chairman
of the Board, or, in his absence or inability to act, another
Director chosen by a majority of the Directors present, shall act
as chairman of the meeting and preside at the meeting. The Secretary
(or, in his absence or inability to act, any person appointed by the
chairman) shall act as secretary of the meeting and keep the minutes
of the meeting.
Article 3.12. Informal Action by Directors and Committees. Any
action required or permitted to be taken at any meeting of the Board
of Directors or of any committee thereof may, except as otherwise
required by statute, be taken without a meeting if a written consent
to such action is signed by all members of the Board, or of such
committee, as the case may be, and filed with the minutes of the
proceedings of the Board or committee. Subject to the Investment
Company Act of 1940, as amended, members of the Board of Directors or
a committee thereof may participate in a meeting by means of a
conference telephone or similar communications equipment if all
persons participating in the meeting can hear each other at the same
time.
Article 3.13. Executive Committee. There may be an Executive
Committee of two or more Directors appointed by the Board who may
meet at stated times or on notice to all by any of their own number.
The Executive Committee shall consult with and advise the Officers of
the Company in the management of its business and exercise such
powers of the Board of Directors as may be lawfully delegated by the
Board of Directors. Vacancies shall be filled by the Board of
Directors at any regular or special meeting. The Executive Committee
shall keep regular minutes of its proceedings and report the same to
the Board when required.
Article 3.14. Audit Committee. There shall be an Audit Committee of
two or more Directors who are not "interested persons" of the Company
(as defined in the Investment Company Act of 1940, as amended)
appointed by the Board who may meet at stated times or on notice to
all by any of their own number. The Committee's duties shall include
reviewing both the audit and other work of the Company's independent
accountants, recommending to the Board of Directors the independent
accountants to be retained, and reviewing generally the maintenance
and safekeeping of the Company's records and documents.
Article 3.15. Other Committees. The Board of Directors may appoint
other committees which shall in each case consist of such number of
members (but not less than two) and shall have and may exercise, to
the extent permitted by law, such powers as the Board may determine
in the resolution appointing them. A majority of all members of any
such committee may determine its action, and fix the time and place
of its meetings, unless the Board of Directors shall otherwise
provide. The Board of Directors shall have power at any time to
change the members and, to the extent permitted by law, to change
the powers of any such committee, to fill vacancies and to
discharge any such committee.
Article 3.16. Compensation of Directors. The Board may, by
resolution, determine what compensation and reimbursement of
expenses of attendance at meetings, if any, shall be paid to
Directors in connection with their service on the Board. Nothing
herein contained shall be construed to preclude any Director from
serving the Company in any other capacity or from receiving
compensation therefor.
BYLAW-FOUR: OFFICERS.
Article 4.1. Officers. The Officers of the Company shall be fixed
by the Board of Directors and shall include a President, Secretary
and Treasurer. Any two of the aforesaid offices may be held by the
same person except the offices of President and Vice President. A
person who holds more than one office in the Company may not act in
more than one capacity to execute, acknowledge or verify an
instrument required by law to be executed, acknowledged or verified
by more than one officer.
Article 4.2. Appointment of Officers. The Directors shall appoint
the Officers, who need not be members of the Board.
Article 4.3. Additional Officers. The Board may appoint such other
Officers and agents as it shall deem necessary who shall exercise
such powers and perform such duties as shall be determined from time
to time by the Board.
Article 4.4. Salaries of Officers. The salaries of all Officers of
the Company shall be fixed by the Board of Directors.
Article 4.5. Term, Removal, Vacancies. The Officers of the Company
shall serve at the pleasure of the Board of Directors and hold office
for one year and until their successors are chosen and qualify in
their stead. Any Officer elected or appointed by the Board of
Directors may be removed at any time by the affirmative vote of a
majority of the Directors. If the office of any Officer becomes
vacant for any reason, the vacancy shall be filled by the Board
of Directors.
Article 4.6. President. The President shall be the chief executive
officer of the Company, shall, subject to the supervision of the
Board of Directors, have general responsibility for the management
of the business of the Company and shall see that all orders and
resolutions of the Board are carried into effect.
Article 4.7. Vice President. The Vice President shall, in the
absence or disability of the President, perform the duties and
exercise the powers of the President and shall perform such other
duties as the Board of Directors shall prescribe.
Article 4.8. Treasurer. The Treasurer shall have the custody of
the corporate funds and securities and shall keep full and accurate
accounts of receipts and disbursements in books belonging to the
Company and shall deposit all moneys and other valuable effects in
the name and to the credit of the Company in such depositories as
may be designated by the Board of Directors. He shall disburse the
funds of the Company as may be ordered by the Board, taking proper
vouchers for such disbursements, and shall render to the Chairman
of the Board and Directors at the regular meetings of the Board,
or whenever they may require it, an account of the financial
condition of the Company.
Any Assistant Treasurer may perform such duties of the Treasurer
as the Treasurer or the Board of Directors may assign, and, in the
absence of the Treasurer, he may perform all the duties of the
Treasurer.
Article 4.9. Secretary. The Secretary shall attend meetings of
the Board and meetings of the Stockholders and record all votes and
the minutes of all proceedings in a book to be kept for that purpose,
and shall perform like duties for the Executive Committee of the Board
when required. He shall give or cause to be given notice of all
meetings of Stockholders and special meetings of the Board of
Directors and shall perform such other duties as may be prescribed
by the Board of Directors. He shall keep in safe custody the seal
of the Company and affix it to any instrument when authorized by the
Board of Directors.
Any Assistant Secretary may perform such duties of the Secretary as
the Secretary or the Board of Directors may assign, and, in the
absence of the Secretary, may perform all the duties of the
Secretary.
Article 4.10. Subordinate Officers. The Board of Directors from
time to time may appoint such other officers or agents as it may deem
advisable, each of whom shall serve at the pleasure of the Board of
Directors and have such title, hold office for such period, have such
authority and perform such duties as the Board of the Directors may
determine. The Board of Directors 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.
Article 4.11. Surety Bonds. The Board of Directors may require any
officer or agent of the Company to execute a bond (including, without
limitation, any bond required by the Investment Company Act of 1940,
as amended, and the rules and regulations of the Securities and
Exchange Commission) to the Company in such sum and with such surety
or sureties as the Board of Directors may determine, conditioned upon
the faithful performance of his duties to the Company, including
responsibility for negligence and for the accounting of any of the
Company's property, funds or securities that may come into his hands.
BYLAW-FIVE: GENERAL PROVISIONS.
Article 5.1. Waiver of Notice. Whenever the Stockholders or the
Board of Directors are authorized by statute, the provisions of the
Articles of Incorporation or these Bylaws to take any action at any
meeting after notice, such notice may be waived, in writing, before
or after the holding of the meeting, by the person or persons
entitled to such notice, or, in the case of a Stockholder, by his
duly authorized attorney-in-fact.
Article 5.2. Indemnity.
(a) The Company shall indemnify its directors to the fullest extent
that indemnification of directors is permitted by the Maryland
General Corporation Law. The Company shall indemnify its officers
to the same extent as its directors and to such further extent as is
consistent with law. The Company shall indemnify its directors and
officers who while serving as directors or officers also serve at the
request of the Company as a director, officer, partner, trustee,
employee, agent or fiduciary of another corporation, partnership,
joint venture, trust, other enterprise or employee benefit plan to
the fullest extent consistent with law. The indemnification and
other rights provided by this Article shall continue as to a person
who has ceased to be a director or officer and shall inure to the
benefit of the heirs, executors and administrators of such a person.
This Article shall not protect any such person against any liability
to the Company or any stockholder thereof to which such person 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 ("disabling conduct").
(b) Any current or former director or officer of the Company seeking
indemnification within the scope of this Article shall be entitled to
advances from the Company for payment of the reasonable expenses
incurred by him in connection with the matter as to which he is
seeking indemnification in the manner and to the fullest extent
permissible under the Maryland General Corporation Law. The person
seeking indemnification shall provide to the Company a written
affirmation of his good faith belief that the standard of conduct
necessary for indemnification by the Company has been met and a
written undertaking to repay any such advance if it should ultimately
be determined that the standard of conduct has not been met. In
addition, at least one of the following additional conditions shall
be met: (a) the person seeking indemnification shall provide a
security in form and amount acceptable to the Company for his
undertaking; (b) the Company is insured against losses arising by
reason of the advance; or (c) a majority of a quorum of directors of
the Company who are neither "interested persons" as defined in
Section 2(a)(19) of the Investment Company Act of 1940, as amended,
nor parties to the proceeding ("disinterested non-party directors"),
or independent legal counsel, in a written opinion, shall have
determined, based on a review of facts readily available to the
Company at the time the advance is proposed to be made, that there
is reason to believe that the person seeking indemnification will
ultimately be found to be entitled to indemnification.
(c) At the request of any person claiming indemnification under
this Article, the Board of Directors shall determine, or cause to
be determined, in a manner consistent with the Maryland General
Corporation Law, whether the standards required by this Article have
been met. Indemnification shall be made only following: (a) a final
decision on the merits by a court or other body before whom the
proceeding was brought that the person to be indemnified was not
liable by reason or disabling conduct or (b) in the absence of such
a decision, a reasonable determination, based upon a review of the
facts, that the person to be indemnified was not liable by reason of
disabling conduct by (i) the vote of a majority of a quorum of
disinterested non-party directors or (ii) an independent legal
counsel in a written opinion.
(d) Employees and agents who are not officers or directors of the
Company may be indemnified, and reasonable expenses may be advanced
to such employees or agents, as may be provided by action of the
Board of Directors or by contract, subject to any limitations imposed
by the Investment Company Act of 1940.
(e) The Board of Directors may make further provision consistent
with law for indemnification and advance of expenses to directors,
officers, employees and agents by resolution, agreement or otherwise.
The indemnification provided by this Article shall not be deemed
exclusive of any other right, with respect to indemnification or
otherwise, to which those seeking indemnification may be entitled
under any insurance or other agreement or resolution of stockholders
or disinterested directors or otherwise.
(f) References in this Article are to the Maryland General
Corporation Law and to the Investment Company Act of 1940 as from
time to time amended. No amendment of these Bylaws shall affect any
right of any person under this Article based on any event, omission
or proceeding prior to the amendment.
Article 5.3. Insurance. The Company may purchase and maintain
insurance on behalf of any person who is or was a director, officer,
employee, or agent of the Company or who, while a director, officer,
employee, or agent of the Company, is or was serving at the request
of the Company as a director, officer, partner, trustee, employee,
or agent of another foreign or domestic corporation, partnership,
joint venture, trust, other enterprise, or employee benefit plan,
against any liability asserted against and incurred by such person
in any such capacity or arising out of such person's position;
provided that no insurance may be purchased by the Company on
behalf of any person against any liability to the Company or to its
Stockholders 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 5.4. Checks. All checks or demands for money and notes of
the Company shall be signed by such officer or officers or such other
person or persons as the Board of Directors may from time to time
designate.
Article 5.5. Fiscal Year. The fiscal year of the Company shall be
determined by resolution of the Board of Directors.
BYLAW-SIX: CERTIFICATES OF STOCK.
Article 6.1. Certificates of Stock. The interest of each
Stockholder of the Company shall be evidenced by certificates for
shares of stock in such form as the Board of Directors may from time
to time prescribe. The certificates shall be numbered and entered in
the books of the Company as they are issued. They shall exhibit the
holder's name and the number of whole shares and no certificate shall
be valid unless it has been signed by the President and the Treasurer
or an Assistant Treasurer or the Secretary or an Assistant Secretary
and bears the corporate seal. Such seal may be a facsimile, engraved
or printed. Where any such certificate is signed by a Transfer Agent
or by a Registrar, the signatures of any such officer may be
facsimile, engraved or printed. In case any of the officers of the
Company whose manual or facsimile signature appears on any stock
certificate delivered to a Transfer Agent of the Company shall cease
to be such Officer prior to the issuance of such certificate, the
Transfer Agent may nevertheless countersign and deliver such
certificate as though the person signing the same or whose facsimile
signature appears thereon had not ceased to be such officer, unless
written instructions of the Company to the contrary are delivered to
the Transfer Agent.
Article 6.2. Lost, Stolen or Destroyed Certificates. The Board of
Directors, or the President together with the Treasurer or Secretary,
may direct a new certificate to be issued in place of any certificate
theretofore issued by the Company, alleged to have been lost, stolen
or destroyed, upon the making of an affidavit of that fact by the
person claiming the certificate of stock to be lost, stolen or
destroyed, or by his legal representative. When authorizing such
issue of a new certificate, the Board of Directors, or the President
and Treasurer or Secretary, may, in its or their discretion and as a
condition precedent to the issuance thereof, require the owner of
such lost, stolen or destroyed certificate, or his legal
representative, to advertise the same in such manner as it or they
shall require and/or give the Company a bond in such sum and with
such surety or sureties as it or they may direct as indemnity
against any claim that may be made against the Company with respect
to the certificate alleged to have been lost, stolen or destroyed
for such newly issued certificate.
Article 6.3. Transfer of Stock. Shares of the Company shall be
transferable on the books of the Company by the holder thereof in
person or by his duly authorized attorney or legal representative
upon surrender and cancellation of a certificate or certificates for
the same number of shares of the same class, duly endorsed or
accompanied by proper evidence of succession, assignment or authority
to transfer, with such proof of the authenticity of the signature as
the Company or its agents may reasonably require. The shares of
stock of the Company may be freely transferred, and the Board of
Directors may, from time to time, adopt rules and regulations with
reference to the method of transfer of the shares of stock of the
Company.
Article 6.4. Registered Holder. The Company shall be entitled to
treat the holder of record of any share or shares of stock as the
holder in fact thereof and, accordingly, shall not be bound to
recognize any equitable or other claim to or interest in such share
or shares on the part of any other person whether or not it shall
have express or other notice thereof, except as expressly provided
by statute.
Article 6.5. Record Date. The Board of Directors may fix a time not
less than 10 nor more than 90 days prior to the date of any meeting
of Stockholders or prior to the last day on which the consent or
dissent of Stockholders may be effectively expressed for any purpose
without a meeting, as the time as of which Stockholders entitled to
notice of, and to vote at, such a meeting or whose consent or dissent
is required or may be expressed for any purpose, as the case may be,
shall be determined; and all such persons who were holders of record
of voting stock at such time and no other shall be entitled to notice
of, and to vote at, such meeting or to express their consent or
dissent, as the case may be. If no record date has been fixed,
the record date for the determination of Stockholders entitled to
notice of, or to vote at, a meeting of Stockholders shall be the
later of the close of business on the day on which notice of the
meeting is mailed or the thirtieth day before the meeting, or, if
notice is waived by all Stockholders, at the close of business on
the tenth day next preceding the day on which the meeting is held.
The Board of Directors may also fix a time not exceeding 90 days
preceding the date fixed for the payment of any dividend or the
making of any distribution, or for the delivery of evidences of
rights, or evidences of interests arising out of any change,
conversion or exchange of capital stock, as a record time for the
determination of the Stockholder entitled to receive any such
dividend, distribution, rights or interests.
Article 6.6. Stock Ledgers. The stock ledgers of the Company,
containing the names and addresses of the Stockholders and the
number of shares held by them respectively, shall be kept at the
principal offices of the Company or at the offices of the transfer
agent of the Company or at such other location as may be authorized
by the Board of Directors from time to time.
Article 6.7. Transfer Agents and Registrars. The Board of Directors
may from time to time appoint or remove transfer agents and/or
registrars of transfers (if any) of shares of stock of the Company,
and it may appoint the same person as both transfer agent and
registrar. Upon any such appointment being made, all certificates
representing shares of capital stock thereafter issued shall be
countersigned by one of such transfer agents or by one of such
registrars of transfers (if any) or by both and shall not be valid
unless so countersigned. If the same person shall be both transfer
agent and registrar, only one countersignature by such person shall
be required.
BYLAW-SEVEN: AMENDMENTS.
Article 7.1. General. Except as provided in the next succeeding
sentence and in the Articles of Incorporation, all Bylaws of the
Corporation, whether adopted by the Board of Directors or the
Stockholders, shall be subject to amendment, alteration or repeal,
and new Bylaws may be made, by the affirmative vote of a majority of
either: (a) the holders of record of the outstanding shares of stock
of the Corporation entitled to vote, at any annual or special
meeting, the notice or waiver of notice of which shall have
specified or summarized the proposed amendment, alteration, repeal
or new Bylaw; or (b) the Directors, at any regular or special meeting
the notice or waiver of notice of which shall have specified or
summarized the proposed amendment, alteration, repeal or new Bylaw.
The provisions of Articles 2.5, 3.2 and 3.3 of these Bylaws shall be
subject to amendment, alteration or repeal by the affirmative vote
of either: (i) the holders of record of 75% of the outstanding
shares of stock of the Corporation entitled to vote, at any annual
or special meeting, the notice or waiver of notice of which shall
have specified or summarized the proposed amendment, alteration or
repeal or (ii) 75% of the Continuing Directors (as such term is
defined in Article VII of the Corporation's Articles of
Incorporation), at any regular or special meeting the notice or
waiver of notice of which shall have specified or summarized the
proposed amendment, alteration or repeal.
Dated: April 21, 1999
