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SIGNATURE MICHAEL PIGNATARO
TITLE CFO & SECRETARY
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
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NOTE F. CONTINGENCIES
Currently, the Fund is a nominal defendant in a shareholder derivative and
purported class action which alleges violations of the Federal securities
laws and breach of fiduciary duty by the Fund's directors and investment
adviser in connection with the Fund's July 1996 rights offering.
By Opinion and Order dated April 6, 1998, the District Court granted a
motion to dismiss the complaint in its entirety as to the class action
claims and denied the motion to dismiss as to all other claims.
On May 22, 1998, the directors created a special litigation committee of
the Board composed of two newly-appointed disinterested directors who are
not named parties in the Strougo Litigation for the purpose of considering
the allegations raised in the Strougo Litigation. In December, 1998, the
special litigation committee issued a report concluding that the claims
had no merits and filed a motion to dismiss or, in the alternative, for
summary judgement. In April 1999, the District Court adjourned the motion
by the special litigation committee, pending further limited discovery
by Mr. Strougo's attorneys. The District Court ordered that discovery
be completed within 60 days from April 26, 1999 at which point the
committee's motion to dismiss or, in the alternative, for summary
judgement will be renewed. That period was subsequently extended
without date, and the parties are in the process of concluding discovery.
The costs of defending the directors in this matter are being advanced
by the Fund pursuant to rights of indemnity set forth in the Fund's
charter documents and are reflected in the Fund's operating expenses.
The investment adviser may be entitled to similar advancement of expenses
and rights of indemnity. Management believes that neither the outcome of
this litigation nor the Fund's related indemnification obligations will
have a material adverse effect on the financial position or future
operating results of the Fund, although there can be no assurance to
that effect.
AMENDED AND RESTATED BYLAWS
OF
THE BRAZILIAN EQUITY FUND, INC.
BYLAW-ONE: NAME OF COMPANY, LOCATION OF OFFICES AND SEAL.
Article 1.1. Name. The name of the Company is The Brazilian Equity
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 1993, 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 a plurality of votes cast, 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 of a majority of the Board of Directors or at
the request, in writing, of Stockholders holding at least a majority of
the votes entitled to be cast at the meeting upon payment by such
Stockholders to the Company 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 Company). A written request
shall state the purpose or purposes of the proposed meeting and the matters
proposed to be acted upon at it. At any special meeting of the Stockholders,
only such business shall be conducted as shall be properly brought before the
meeting and has been indicated in the notice of meeting given in accordance
with Article 2.4 of these Bylaws. The chairman of the special meeting shall,
if the facts warrant, determine and declare to the meeting that business
was not properly brought before the meeting or is not a proper subject for
the meeting; any such business shall not be considered or transacted.
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 notice of or to vote at such meeting. If mailed (i) 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 (ii) 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 Annual Meetings (a)
At any annual 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 meeting, the business must (i) be
specified in the notice of meeting (or any supplement thereto) given by or
at the direction of the Board of Directors, (ii) otherwise be properly
brought before the meeting by or at the direction of the Board of Directors,
or (iii) otherwise (x) be properly brought before the meeting by a
Stockholder who is entitled to vote at the meeting, who complies with the
notice procedures set forth in this Article 2.5 and who is a Stockholder of
record at the time such notice is delivered to the Secretary of the Company,
and (y) constitute a proper subject to be brought before the meeting.
(b) For business to be properly brought before an annual meeting by a
Stockholder, the Stockholder must have given timely notice thereof in
writing to the Secretary of the Company. To be timely, such notice must
be delivered to or mailed and received at the principal executive offices
of the Company not later than 45 days before the date in the then current
year corresponding to the date on which the Company first mailed its notice
and proxy materials for the annual meeting held in the prior year; provided,
however, that in the event that the date of the annual meeting is advanced
or delayed by more than 30 days from the first anniversary of the preceding
year's annual meeting, notice by such 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 or public announcement of the date of such meeting
was given or made. In no event shall the public announcement of an
adjournment of an annual meeting commence a new time period for the giving
of a Stockholder's notice as described above.
(c) Any such notice by a Stockholder shall set forth as to each matter the
Stockholder proposes to bring before the annual meeting (i) a brief
description of the business desired to be brought before the annual meeting
and the reasons for conducting such business at the annual meeting, (ii)
the name and address, as they appear on the Company's books, of the
Stockholder proposing such business, (iii) the class and number of shares
of the capital stock of the Company which are beneficially owned by the
Stockholder, (iv) a representation that the Stockholder is a holder of
record of shares of the Company entitled to vote at such meeting and intends
to appear in person or by proxy at the meeting to present such business, (v)
whether the Stockholder intends or is part of a group which intends to
solicit proxies from other Stockholders in support of such business, and (vi)
any material interest of the Stockholder in such business.
(d) Notwithstanding anything in these Bylaws to the contrary, no business
shall be conducted at any annual meeting except in accordance with the
procedures set forth in this Article 2.5. The chairman of the annual
meeting shall, if the facts warrant, determine and declare to the meeting
that (i) the business proposed to be brought before the meeting is not a
proper subject thereof and/or (ii) such business was not properly brought
before the meeting 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 shall not be considered or transacted.
(e) For purpose of Articles 2.5 and 3.3 of these Bylaws, "public
announcement" shall mean disclosure in a press release reported by the
Dow Jones News Service, Bloomberg or comparable news service or in a
document publicly filed by the Company with the Securities and Exchange
Commission pursuant to the Securities Exchange Act of 1934 or the
Investment Company Act of 1940, as amended.
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 the
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 provisions 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 President
or a Vice President of the Company, 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.
The Board of Directors of the Company shall be entitled to make such rules
or regulations for the conduct of meetings of Stockholders as it shall deem
necessary or appropriate. Subject to such rules and regulations of the Board
of Directors, if any, the chairman of the meeting shall have the right and
authority to prescribe such rules, regulations and procedures and to do all
such acts as, in the judgment of such chairman, are necessary or appropriate
for the proper conduct of the meeting, including, without limitation,
establishing an order of business for the meeting, rules and procedures
for maintaining order at the meeting and the safety of those present,
limitations on participation in such meeting to Stockholders of record
of the Company and their duly authorized and constituted proxies, and
such other persons as the chairman shall permit, limitations on the
time allotted to questions or comments by participants and regulation
of the opening and closing of the polls for balloting and matters which
are to be voted on by ballot.
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 Company
shall be managed under the direction of the Board of Directors.
All powers of the Company 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 less than three stockholders, the number of
Directors may be less than three but not less than the number of
stockholders or one, if less. Directors need not be Stockholders.
The majority of the entire Board of Directors shall have power from
time to time 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 he 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 Company may be made at an annual meeting of
Stockholders or at a special meeting of Stockholders as to which the
Company's notice of the meeting provides for election of directors, by
or at the direction of the Board of Directors or by any Stockholder of
the Company who is entitled to vote for the election of such nominee at
the meeting, who complies with the notice procedures set forth in this
Article 3.3 and who is a Stockholder of record at the time such notice
is delivered to the Secretary of the Company.
(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 Company. To be timely, (i) any notice
of nomination(s) by a Stockholder given in connection with an annual
meeting must be delivered to or mailed and received at the principal
executive offices of the Company not later than 45 days before the date
in the then current year corresponding to the date on which the Company
first mailed its notice and proxy materials for the annual meeting held
in the prior year; provided, however, that in the event that the date
of the annual meeting is advanced or delayed by more than 30 days from
the first anniversary of the preceding year's annual meeting, notice by
such 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 or public
announcement of the date of such meeting was given or made, and (ii)
any notice of nomination(s) given in connection with a special meeting
as to which the Company's notice of the meeting provides for election
of directors must be delivered to or mailed and received at the principal
executive offices of the Company 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 such special 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 such special meeting was
given or such public disclosure was made. In no event shall the public
announcement of an adjournment of a meeting commence a new time period for
the giving of a Stockholder's notice of nomination(s) as described above.
(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 Company 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 person's 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 Company of the expenses
of any solicitation of proxies should such person be elected a Director
of the Company); and (ii) as to the Stockholder giving the notice (A) the
name and address, as they appear on the Company's books, of such Stockholder,
(B) the class and number of shares of the capital stock of the Company which
are beneficially owned by such Stockholder, (C) a representation that the
Stockholder is a holder of record of shares of the Company entitled to vote
at such meeting and intends to appear in person or by proxy at the meeting
to present such nomination(s) and (D) whether the Stockholder intends or
is part of a group which intends to solicit proxies from other Stockholders
in support of such nomination(s). 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 Company 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
Company 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 Company and the Board of
Directors approves such reimbursement. 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 as provided for in Article 3.2), 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 annual
meeting of Stockholders and until his successor is elected and qualifies,
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
of the Board or the Secretary of the Company. 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 the
Board.
Article 3.9. Special Meetings. Special meetings of the Board may be
called by order of the 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 of the Board or the
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. 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, 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 composed of one or more members which shall in each
case consist of such number of members 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, Vice President,
Secretary and Treasurer. Any two 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 th
e 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. Any 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, 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 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. Such
notice is also waived if the person entitled to the notice is present at
the meeting in person, or, in the case of a stockholder, by proxy.
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 conditions shall be met: (i) the person seeking
indemnification shall provide security in form and amount acceptable
to the Company for his undertaking; (ii) the Company is insured against
losses arising by reason of the advance; or (iii) 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: (i) 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 of disabling conduct or (ii) 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 (a) the vote of a majority of a quorum of disinterested
non-party directors or (b) 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 mi
ligence 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, a Vice President or the Chairman of the Board of Directors
and the Treasurer or an Assistant Treasurer or the Secretary or an Assistant
Secretary and bears the corporate seal. Any or all of the signatures or the
seal on the certificate may be a 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 if such
Transfer Agents or Registrars are not the same person, and shall not be
valid unless the certificates are 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. The Board of Directors, by affirmative vote of
a majority thereof, shall have the exclusive right to make, amend, alter
and repeal the Bylaws of the Company, 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, except as otherwise
required by the Investment Company Act of 1940, as amended.
BYLAW-EIGHT: SPECIAL PROVISIONS.
Article 8.1. Actions Relating to Discount in Price of the Company's Shares.
In the event that at any time after the second anniversary of the initial
public offering of shares of the Company's Common Stock such shares publicly
trade for a substantial period of time at a substantial discount from the
Company's then current net asset value per share, the Board of Directors
shall consider, at its next regularly scheduled meeting, taking various
actions designed to eliminate the discount. The actions conside
Dated: November 9, 1999
0097904.07
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