-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, WKACQY6i0WSYH/OEUbijOsdaLIHss7iucZklqaeWgnTYx0Jnj0nUQdkRKCJUAQ5Q ZxHFp7QaLX56SNCGuiHhBg== 0001236835-09-000298.txt : 20091230 0001236835-09-000298.hdr.sgml : 20091230 20091230154408 ACCESSION NUMBER: 0001236835-09-000298 CONFORMED SUBMISSION TYPE: NSAR-B PUBLIC DOCUMENT COUNT: 8 CONFORMED PERIOD OF REPORT: 20091031 FILED AS OF DATE: 20091230 DATE AS OF CHANGE: 20091230 EFFECTIVENESS DATE: 20091230 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MORGAN STANLEY INSURED MUNICIPAL BOND TRUST CENTRAL INDEX KEY: 0000861185 IRS NUMBER: 000000000 STATE OF INCORPORATION: MA FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: NSAR-B SEC ACT: 1940 Act SEC FILE NUMBER: 811-06053 FILM NUMBER: 091266458 BUSINESS ADDRESS: STREET 1: 522 FIFTH AVENUE CITY: NEW YORK STATE: NY ZIP: 10036 BUSINESS PHONE: 800-869-6397 MAIL ADDRESS: STREET 1: 522 FIFTH AVENUE CITY: NEW YORK STATE: NY ZIP: 10036 FORMER COMPANY: FORMER CONFORMED NAME: MORGAN STANLEY DEAN WITTER INSURED MUNICIPAL BOND TRUST DATE OF NAME CHANGE: 19981221 FORMER COMPANY: FORMER CONFORMED NAME: INTERCAPITAL INSURED MUNICIPAL BOND TRUST DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: ALLSTATE MUNICIPAL PREMIUM INCOME TRUST II DATE OF NAME CHANGE: 19901202 NSAR-B 1 answer.fil ANSWER FILE PAGE 1 000 B000000 10/31/2009 000 C000000 0000861185 000 D000000 N 000 E000000 NF 000 F000000 Y 000 G000000 N 000 H000000 N 000 I000000 6.1 000 J000000 A 001 A000000 MORGAN STANLEY INSURED MUNICIPAL BOND TRUST 001 B000000 811-06053 001 C000000 2122966963 002 A000000 522 FIFTH AVENUE 002 B000000 NEW YORK 002 C000000 NY 002 D010000 10036 003 000000 N 004 000000 N 005 000000 N 006 000000 N 007 A000000 N 007 B000000 0 007 C010100 1 008 A000001 MORGAN STANLEY INVESTMENT ADVISORS INC. 008 B000001 A 008 C000001 801-42061 008 D010001 NEW YORK 008 D020001 NY 008 D030001 10036 010 A000001 MORGAN STANLEY SERVICES COMPANY INC. 010 B000001 8-00000 010 C010001 JERSEY CITY 010 C020001 NJ 010 C030001 07311 012 A000001 COMPUTERSHARE TRUST COMPANY, N.A. 012 B000001 84-00000 012 C010001 PROVIDENCE 012 C020001 RI 012 C030001 02940 012 C040001 3078 013 A000001 DELOITTE & TOUCHE LLP 013 B010001 NEW YORK 013 B020001 NY 013 B030001 10281 014 A000001 ARIGIL MENKUL DEGERLER A.S. 014 B000001 8-00000 014 A000002 BANK MORGAN STANLEY AG 014 B000002 8-00000 014 A000003 BETTER ALTERNATIVE TRADING SYSTEM 014 B000003 8-00000 014 A000004 BLOCK INTEREST DISCOVERY SERVICE PAGE 2 014 B000004 8-00000 014 A000005 CHINA INTERNATIONAL CAPITAL CORP. 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The Special Meeting of Shareholders was adjourned until December 12, 2008 with respect to proposal 1 only. The voting results with respect to all proposals were as follows: (1) Approval of a modification to the Trust's investment policies to allow the Trust to invest, under normal market conditions, at least 80% of the Trust's net assets in municipal obligations which are covered by insurance guaranteeing the timely payment of principal and interest thereon and that are rated at least "A" by a nationally recognized statistical rating organization ("NRSRO") or are unrated but judged to be of similar credit quality by the Trust's Investment Adviser, or covered by insurance issued by insurers rated at least "A" by a NRSRO: FOR AGAINST ABSTAIN BNV* COMMON SHAREHOLDERS 1,850,486 314,837 129,168 0 PREFERRED SHAREHOLDERS 356 8 3 0 (2) Approval of a modification to the Trust's investment policies to allow the Trust to invest up to 20% of the Trust's net assets in taxable or tax-exempt fixed income securities rated at least investment grade by a nationally recognized statistical rating organization or, if not rated, determined by the Trust's Investment Adviser to be of comparable quality, including uninsured municipal obligations, obligations of the U.S. government, its respective agencies or instrumentalities, and other fixed income obligations, and, during periods in which the Investment Adviser believes that changes in economic, financial or political conditions make it advisable to do so, to invest an unlimited extent in such investments for temporary defensive purposes. The Trust may also invest in options, futures, swaps and other derivatives: FOR AGAINST ABSTAIN BNV* 1,702,689 341,872 129,918 0 (3) Eliminate certain fundamental policies and restrictions:

(4) Modify certain fundamental investment policies and restrictions:

* Broker "non-votes" are shares held in street name for which the broker indicates that instructions have not been received from the beneficial owners or other persons entitled to vote and for which the broker does not have discretionary voting authority. EX-99.77D POLICIES 3 subitem77d.txt POLICY CHANGES SUB-ITEM 77D: POLICIES WITH RESPECT TO SECURITY INVESTMENT Effective October 13, 2009, the Board of Trustees of the Trust approved a change to the Trust's investment practice to permit the Trust to invest, without limit, in private placement securities in order to enhance portfolio management flexibility in managing the Trust. EX-99.77O RULE 10F-3 4 tenf3.txt 10F3 TRANSACTIONS MORGAN STANLEY INSURED MUNICIPAL BOND TRUST ITEM 77(O) 10F-3 TRANSACTIONS MAY 1, 2009 - OCTOBER 31, 2009 AMOUNT OF % OF % OF OFFERING SHARES OFFERING FUNDS SECURITY PURCHASE/ SIZE OF PRICE OF TOTAL AMOUNT PURCHASED PURCHASED TOTAL PURCHASED TRADE DATE OFFERING SHARES OF OFFERING BY FUND BY FUND ASSETS BROKERS PURCHASED FROM - ---------------- ---------- -------- -------- ----------------- -------------- --------- ------ ------------------- ---------------- Puerto Rico 06/11/09 -- $100.000 $354,925,000 260,000 0.07% 0.35% Citi, Goldman Sachs Sales Tax Goldman, Financing Sachs & Co., 5.00% due J.P. Morgan, 8/1/2039 Popular Securities, Santander Securities, Merrill Lynch & Co., Barclays Capital, Morgan Stanley, UBS Financial Services Incorporated of Puerto Rico State of Iowa 07/14/09 -- $105.323 $380,120,000 710,000 0.19% 0.94% Barclays Barclays - ljobs Capital, Capital Program Merrill Lynch Specialist & Co., Obligation Williams Bonds Series Blair & 2009 Company, Citi, Goldman, Sachs & Co., J.P. Morgan, Morgan Stanley, RBC Capital Markets

EX-99.77Q1 OTHR EXHB 5 adminagreement.txt ADMIN AGREEMENT ADMINISTRATION AGREEMENT AGREEMENT made as of the November 1, 2004 and supplemented as of April 24, 2008, by and between the registered investment companies, including any portfolio/series thereof, as set forth on Schedule A (each, a "Fund" and collectively, the "Funds") as may be amended from time to time, and Morgan Stanley Services Company Inc., a Delaware corporation (hereinafter called the "MS Services"): WHEREAS, on the date hereof, the Funds and Morgan Stanley Investment Advisors Inc. (the "Investment Adviser") are entering into an Amended and Restated Investment Advisory Agreement (the "Investment Advisory Agreement") which further amends an Amended and Restated Investment Management Agreement, dated as of May 1, 2004 between the Funds and the Investment Adviser (the "Amended and Restated Investment Management Agreement") to remove from the Amended and Restated Investment Management Agreement administrative and other management services, with those services to be provided for in a separate agreement; WHEREAS, the Funds desire to retain MS Services to perform the administrative services as described below; and WHEREAS, MS Services desires to be retained by the Funds to perform such administrative services; NOW, THEREFORE, in consideration of the mutual covenants and agreements of the parties hereto as herein set forth, the parties covenant and agree as follows: 1. MS Services agrees to provide administrative services to each Fund as hereinafter set forth. Without limiting the generality of the foregoing, MS Services shall (i) administer the Fund's business affairs and supervise the overall day-to-day operations of the Fund (other than rendering investment advice); (ii) provide the Fund with full administrative services, including the maintenance of certain books and records, such as journals, ledger accounts and other records required under the Investment Company Act of 1940, as amended (the "Act"), the notification to the Fund of available funds for investment, the reconciliation of account information and balances among the Fund's custodian, transfer agent and dividend disbursing agent and the Fund, and the calculation of the net asset value of the Fund's shares; (iii) provide the Fund with the services of persons competent to perform such supervisory, administrative and clerical functions as are necessary to provide effective operation of the Fund; (iv) oversee the performance of administrative and professional services rendered to the Fund by others, including its custodian, transfer agent and dividend disbursing agent, as well as accounting, auditing and other services, including: (1) maintenance of the books and records and accounting controls for the Fund's assets, including records of all securities transactions; (2) daily calculation of the net asset value for each of the Fund's Portfolios; (3) accounting for dividends and interest received and distributions made by each of the Fund's Portfolios; (4) preparation and filing of the Fund's U.S. tax returns and annual and semi-annual reports; (5) the production of transaction data, financial reports and such other periodic and special reports as the Board of Directors of the Fund may reasonably request; (6) the preparation of financial statements for the annual and semi-annual reports and other shareholder communications; (7) liaison with the Fund's independent registered public accounting firms; (8) monitoring and administration of arrangements with the Fund's custodian and depository banks; and (9) maintenance of (but not the payment for) the Fidelity Bond required to be maintained under Investment Company Act of 1940 (the "1940 Act") and preparation of the filings required in connection therewith; (v) provide the Fund with adequate general office space and facilities; (vi) assist in the preparation and the printing of the periodic updating of the Fund's registration statement and prospectus (and, in the case of an open-end Fund, the statement of additional information), tax returns, proxy statements, and reports to its shareholders and the Securities and Exchange Commission; and (vii) monitor the compliance of the Fund's investment policies and restrictions. 2. MS Services shall, at its own expense, maintain such staff and employ or retain such personnel and consult with such other persons as it shall from time to time determine to be necessary or useful to the performance of its obligations under this Agreement. Without limiting the generality of the foregoing, the staff and personnel of MS Services shall be deemed to include officers of MS Services and persons employed or otherwise retained by MS Services (including officers and employees of the Funds, with the consent of the Funds) to furnish services, statistical and other factual data, information with respect to technical and scientific developments, and such other information, advice and assistance as MS Services may desire. MS Services shall maintain each Fund's records and books of account (other than those maintained by the Fund's transfer agent, registrar, custodian and other agencies). All such books and records so maintained shall be the property of the Fund and, upon request therefor, MS Services shall surrender to the Fund such of the books and records so requested. 3. The Funds will, from time to time, furnish or otherwise make available to MS Services such financial reports, proxy statements and other information relating to the business and affairs of the Fund as MS Services may reasonably require in order to discharge its duties and obligations to the Fund under this Agreement or to comply with any applicable law and regulation or request of the Board of Directors/Trustees of the Fund. 4. For the services to be rendered, the facilities furnished, and the expenses assumed by MS Services, the Funds shall pay to MS Services monthly compensation calculated daily (in the case of an open-end Fund) or weekly (in the case of a closed-end Fund) by applying the annual rate or rates set forth on Schedule B to the net assets of each Fund. Except as hereinafter set forth, (i) in the case of an open-end Fund, compensation under this Agreement shall be calculated by applying 1/365th of the annual rate or rates to the Fund's or the Series' daily net assets determined as of the close of business on that day or the last previous business day and (ii) in the case of a closed-end Fund, compensation under this Agreement shall be calculated by applying the annual rate or rates to the Fund's average weekly net assets determined as of the close of the last business day of each week. If this Agreement becomes effective subsequent to the first day of a month or shall terminate before the last day of a month, compensation for that part of the month this Agreement is in effect shall be prorated in a manner consistent with the calculation of the fees as set forth on Schedule B. For the purposes of calculating the administrative fee for the closed-end funds referenced on Annex 2 to the Investment Advisory Agreement, the liquidation preference of any Preferred Shares issued by each of such Funds will not be deducted from the Fund's total assets. In addition, for purposes of this calculation, an amount up to the aggregate amount of any other borrowings may be included in the Fund's administrative fee calculation. Subject to the provisions of paragraph 5 hereof, payment of MS Services' compensation for the preceding month shall be made as promptly as possible after completion of the computations contemplated by paragraph 5 hereof. 5. In the event the operating expenses of those Funds identified in Annex 3 to the Investment Advisory Agreement, including amounts payable to the Investment Adviser pursuant to paragraph 7 thereof and the amounts payable hereunder, for any fiscal year ending on a date on which this Agreement is in effect, exceed the expense limitations applicable to the Fund and/or any Series thereof imposed by state securities laws or regulations thereunder, as such limitations may be raised or lowered from time to time, the fee payable hereunder shall be reduced on a pro rata basis in the same proportion as the fee payable by the Fund under the Investment Advisory Agreement is reduced. 6. MS Services shall bear the cost of rendering the administrative services to be performed by it under this Agreement, and shall, at its own expense, pay the compensation of the officers and employees, if any, of the Funds who are also directors, officers or employees of MS Services, and provide -2- such office space and equipment and such clerical and bookkeeping services as each Fund shall reasonably require in the conduct of its business. MS Services shall also bear the cost of heat, light, power and other utilities provided to each Fund and the cost of out-of-pocket expenses incurred in the ordinary course of providing services under this Agreement, such as telephone, fax, system usage, internal controls assurance (such as a Statement on Auditing Standards (SAS) No. 70 report), envelopes, postage and special delivery mail. Each Fund shall reimburse MS Services for any extraordinary expenses and the expenses of one or more independent pricing services, approved from time to time by the Board of Directors of a Fund, to obtain securities prices in connection with determining the net asset value of the Fund. The Fund will reimburse MS Services for its share of the cost of such services based upon its actual use of the services. 7. MS Services will use its best efforts in the performance of administrative activities on behalf of each Fund, but in the absence of willful misfeasance, bad faith, gross negligence or reckless disregard of its obligations hereunder, MS Services shall not be liable to the Fund or any of its investors for any error of judgment or mistake of law or for any act or omission by MS Services or for any losses sustained by the Fund or its investors. 8. It is understood that any of the shareholders, Directors/Trustees, officers and employees of the Fund may be a shareholder, director, officer or employee of, or be otherwise interested in, MS Services, and in any person controlling, controlled by or under common control with MS Services, and that MS Services and any person controlling, controlled by or under common control with MS Services may have an interest in the Fund. It is also understood that MS Services and any affiliated persons thereof or any persons controlling, controlled by or under common control with MS Services have and may have advisory, management, administration service or other contracts with other organizations and persons, and may have other interests and businesses, and further may purchase, sell or trade any securities or commodities for their own accounts or for the account of others for whom they may be acting. 9. This Agreement shall continue unless terminated by either party by written notice delivered to the other party within 30 days. In the event that the Amended and Restated Investment Advisory Agreement between any Fund and the Investment Adviser is terminated, this Agreement will automatically terminate with respect to such Fund. 10. This Agreement may be amended or modified by the parties in any manner by written agreement executed by each of the parties hereto. 11. This Agreement may be assigned by either party with the written consent of the other party. 12. This Agreement shall be construed and interpreted in accordance with the laws of the State of New York. -3- IN WITNESS WHEREOF, the parties hereto have executed and delivered this Agreement, as amended, on April 24, 2008 in New York, New York. ON BEHALF OF EACH FUND AS SET FORTH IN SCHEDULE A By: /s/ Amy R. Doberman ------------------------------------ Amy R. Doberman Vice President Attest: /s/ Joanne Antico - ------------------------------------- Joanne Antico MORGAN STANLEY SERVICES COMPANY INC. By: /s/ Stefanie V. Chang Yu ------------------------------------ Stefanie V. Chang Yu Managing Director Attest: /s/ Yvette K. Hayes - ------------------------------------- Yvette K. Hayes SCHEDULE A MORGAN STANLEY FUNDS AT JANUARY 15, 2009 OPEN-END FUNDS 1. Active Assets California Tax-Free Trust 2. Active Assets Government Securities Trust 3. Active Assets Institutional Government Securities Trust 4. Active Assets Institutional Money Trust 5. Active Assets Money Trust 6. Active Assets Tax-Free Trust 7. Morgan Stanley Balanced Fund 8. Morgan Stanley California Tax-Free Daily Income Trust 9. Morgan Stanley California Tax-Free Income Fund 10. Morgan Stanley Capital Opportunities Trust 11. Morgan Stanley Convertible Securities Trust 12. Morgan Stanley Series Funds: - Morgan Stanley Alternative Opportunities Fund - Morgan Stanley Commodities Alpha Fund - Morgan Stanley Commodities Alpha Fund (Cayman) Ltd. - Morgan Stanley U.S. Multi-Cap Alpha Fund 13. Morgan Stanley Dividend Growth Securities Inc. 14. Morgan Stanley Equally-Weighted S&P Index Fund 15. Morgan Stanley European Equity Fund Inc. 16. Morgan Stanley Flexible Income Trust 17. Morgan Stanley Focus Growth Fund 18. Morgan Stanley Fundamental Value Fund Sch.A-1 19. Morgan Stanley FX Series Fund: - Morgan Stanley FX Alpha Plus Strategy Portfolio - Morgan Stanley FX Alpha Strategy Portfolio 20. Morgan Stanley Global Advantage Fund 21. Morgan Stanley Global Dividend Growth Securities 22. Morgan Stanley Global Infrastructure Fund 23. Morgan Stanley Health Sciences Trust 24. Morgan Stanley High Yield Securities Inc. 25. Morgan Stanley Income Trust 26. Morgan Stanley International Fund 27. Morgan Stanley International Value Equity Fund 28. Morgan Stanley Limited Duration Fund 29. Morgan Stanley Limited Duration U.S. Government Trust 30. Morgan Stanley Limited Term Municipal Trust 31. Morgan Stanley Liquid Asset Fund Inc. 32. Morgan Stanley Mid Cap Growth Fund 33. Morgan Stanley Mid-Cap Value Fund 34. Morgan Stanley Mortgage Securities Trust 35. Morgan Stanley Natural Resource Development Securities Inc. 36. Morgan Stanley New York Municipal Money Market Trust 37. Morgan Stanley New York Tax-Free Income Fund 38. Morgan Stanley Pacific Growth Fund Inc. 39. Morgan Stanley Real Estate Fund 40. Morgan Stanley Select Dimensions Investment Series (i) Balanced Portfolio (ii) Capital Growth Portfolio Sch.A-2 (iii) Capital Opportunities Portfolio (iv) Dividend Growth Portfolio (v) Equally-Weighted S&P 500 Portfolio (vi) Flexible Income Portfolio (vii) Focus Growth Portfolio (viii) Global Equity Portfolio (ix) Global Infrastructure Portfolio (x) Mid Cap Growth Portfolio (xi) Money Market Portfolio 41. Morgan Stanley Small-Mid Special Value Fund 42. Morgan Stanley Special Growth Fund 43. Morgan Stanley Special Value Fund 44. Morgan Stanley Strategist Fund 45. Morgan Stanley S&P 500 Index Fund 46. Morgan Stanley Tax-Exempt Securities Trust 47. Morgan Stanley Tax-Free Daily Income Trust 48. Morgan Stanley Technology Fund 49. Morgan Stanley U.S. Government Money Market Trust 50. Morgan Stanley U.S. Government Securities Trust 51. Morgan Stanley Value Fund 52. Morgan Stanley Variable Investment Series (i) Aggressive Equity Portfolio (ii) Capital Opportunities Portfolio (iii) Dividend Growth Portfolio (iv) European Equity Portfolio (v) Global Advantage Portfolio Sch.A-3 (vi) Global Dividend Growth Portfolio (vii) Global Infrastructure Portfolio (viii) High Yield Portfolio (ix) Income Builder Portfolio (x) Income Plus Portfolio (xi) Limited Duration Portfolio (xii) Money Market Portfolio (xiii) S&P 500 Index Portfolio (xiv) Strategist Portfolio CLOSED-END FUNDS 53. Morgan Stanley California Insured Municipal Income Trust 54. Morgan Stanley California Quality Municipal Securities 55. Morgan Stanley Income Securities Inc. 56. Morgan Stanley Insured California Municipal Securities 57. Morgan Stanley Insured Municipal Bond Trust 58. Morgan Stanley Insured Municipal Income Trust 59. Morgan Stanley Insured Municipal Securities 60. Morgan Stanley Insured Municipal Trust 61. Morgan Stanley Municipal Income Opportunities Trust 62. Morgan Stanley Municipal Income Opportunities Trust II 63. Morgan Stanley Municipal Income Opportunities Trust III 64. Morgan Stanley Municipal Premium Income Trust 65. Morgan Stanley New York Quality Municipal Securities 66. Morgan Stanley Quality Municipal Income Trust 67. Morgan Stanley Quality Municipal Investment Trust 68. Morgan Stanley Quality Municipal Securities Sch.A-4 SCHEDULE B MORGAN STANLEY SERVICES COMPANY INC. SCHEDULE OF ADMINISTRATIVE FEES Monthly compensation calculated daily by applying the following annual rates to a fund's daily net assets. The fees set forth herein are subject to the waivers and/or limitations for certain of the Funds described in Schedule A of the Investment Advisory Agreement: FIXED INCOME FUNDS 0.080% of the daily net assets. Morgan Stanley California Tax-Free Income Fund Morgan Stanley Convertible Securities Trust Morgan Stanley Flexible Income Trust Morgan Stanley High Yield Securities Inc. Morgan Stanley Income Trust Morgan Stanley Limited Duration Fund Morgan Stanley Limited Term Municipal Trust Morgan Stanley Mortgage Securities Trust Morgan Stanley New York Tax-Free Income Fund Morgan Stanley Select Dimensions Investment Series: - Flexible Income Portfolio Morgan Stanley Series Fund: - Morgan Stanley Commodities Alpha Fund Morgan Stanley Tax-Exempt Securities Trust Morgan Stanley U.S. Government Securities Trust Morgan Stanley Variable Investment Series-- - High Yield Portfolio - Income Plus Portfolio - Limited Duration Portfolio Sch.B-1 EQUITY FUNDS 0.080% of the daily net assets. Morgan Stanley Balanced Fund Morgan Stanley Capital Opportunities Trust Morgan Stanley Dividend Growth Securities Inc. Morgan Stanley Equally-Weighted S&P 500 Index Fund Morgan Stanley European Equity Fund Inc. Morgan Stanley Focus Growth Fund Morgan Stanley Fundamental Value Fund Morgan Stanley FX Series Funds: - Morgan Stanley FX Alpha Plus Strategy Portfolio - Morgan Stanley FX Alpha Strategy Portfolio Morgan Stanley Global Advantage Fund Morgan Stanley Global Dividend Growth Securities Morgan Stanley Global Infrastructure Fund Morgan Stanley Health Sciences Trust Morgan Stanley International Fund Morgan Stanley International Value Equity Fund Morgan Stanley Mid Cap Growth Fund Morgan Stanley Mid-Cap Value Fund Morgan Stanley Natural Resource Development Securities Inc. Morgan Stanley Pacific Growth Fund Inc. Morgan Stanley Real Estate Fund Morgan Stanley S&P 500 Index Fund Morgan Stanley Select Dimensions Investment Series: Sch.B-2 - Balanced Portfolio - Capital Growth Portfolio - Capital Opportunities Portfolio - Dividend Growth Portfolio - Equally-Weighted S&P 500 Index Portfolio - Focus Growth Portfolio - Global Equity Portfolio - Global Infrastructure Portfolio - Mid Cap Growth Portfolio Morgan Stanley Series Funds: - Morgan Stanley Alternative Opportunities Fund - Morgan Stanley U.S. Multi Cap Alpha Fund Morgan Stanley Small-Mid Special Value Fund Morgan Stanley Special Growth Fund Morgan Stanley Special Value Fund Morgan Stanley Strategist Fund Morgan Stanley Technology Fund Morgan Stanley Value Fund Morgan Stanley Variable Investment Series-- - Aggressive Equity Portfolio - Dividend Growth Portfolio - European Equity Portfolio - Global Advantage Portfolio - Global Dividend Growth Portfolio - Global Infrastructure Portfolio - Income Builder Portfolio Sch.B-3 - S&P 500 Index Portfolio - Strategist Portfolio MONEY MARKET FUNDS 0.050% of the daily net assets. Active Assets Trusts: (1) Active Assets California Tax-Free Trust (2) Active Assets Government Securities Trust (3) Active Assets Institutional Government Securities Trust (4) Active Assets Institutional Money Trust (5) Active Assets Money Trust (6) Active Assets Tax-Free Trust Morgan Stanley California Tax-Free Daily Income Trust Morgan Stanley Liquid Asset Fund Inc. Morgan Stanley New York Municipal Money Market Trust Morgan Stanley Select Dimensions Investment Series -- - Money Market Portfolio Morgan Stanley Tax-Free Daily Income Trust Morgan Stanley U.S. Government Money Market Trust Morgan Stanley Variable Investment Series -- - Money Market Portfolio Monthly compensation calculated weekly by applying the following annual rates to a fund's weekly net assets: CLOSED-END FUNDS 0.080% of the average weekly net assets (including an amount up to the aggregate amount of any other borrowings). Morgan Stanley California Insured Municipal Income Trust Sch.B-4 Morgan Stanley California Quality Municipal Securities Morgan Stanley Income Securities Inc. Morgan Stanley Insured California Municipal Securities Morgan Stanley Insured Municipal Bond Trust Morgan Stanley Insured Municipal Income Trust Morgan Stanley Insured Municipal Securities Morgan Stanley Insured Municipal Trust Morgan Stanley Municipal Income Opportunities Trust Morgan Stanley Municipal Income Opportunities Trust II Morgan Stanley Municipal Income Opportunities Trust III Morgan Stanley Municipal Premium Income Trust Morgan Stanley New York Quality Municipal Securities Morgan Stanley Quality Municipal Income Trust Morgan Stanley Quality Municipal Investment Trust Morgan Stanley Quality Municipal Securities Sch.B-5 EX-99.77B ACCT LTTR 6 audit.txt AUDITORS LETTER REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Shareholders and Board of Trustees of Morgan Stanley Insured Municipal Bond Trust: In planning and performing our audit of the financial statements of Morgan Stanley Insured Municipal Bond Trust (the Trust) as of and for the year ended October 31, 2009, in accordance with the standards of the Public Company Accounting Oversight Board (United States), we considered the Trust's internal control over financial reporting, including controls over safeguarding securities, as a basis for designing our auditing procedures for the purpose of expressing our opinion on the financial statements and to comply with the requirements of Form N-SAR, but not for the purpose of expressing an opinion on the effectiveness of the Trust's internal control over financial reporting. Accordingly, we express no such opinion. The management of the Trust is responsible for establishing and maintaining effective internal control over financial reporting. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of controls. A fund's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A fund's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the fund; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the fund are being made only in accordance with authorizations of management and trustees of the fund; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of a fund's assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate. A deficiency in internal control over financial reporting exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the fund's annual or interim financial statements will not be prevented or detected on a timely basis. Our consideration of the Trust's internal control over financial reporting was for the limited purpose described in the first paragraph and would not necessarily disclose all deficiencies in internal control that might be material weaknesses under standards established by the Public Company Accounting Oversight Board (United States). However, we noted no deficiencies in the Trust's internal control over financial reporting and its operation, including controls for safeguarding securities, that we consider to be a material weakness, as defined above, as of October 31, 2009. This report is intended solely for the information and use of management and the Board of Trustees of Morgan Stanley Insured Municipal Bond Trust and the Securities and Exchange Commission and is not intended to be and should not be used by anyone other than these specified parties. /s/ Deloitte & Touche LLP December 24, 2009 EX-99.77Q1 OTHR EXHB 7 investmentadvisoryagreement.txt ADVISORY AGREEMENT AMENDED AND RESTATED INVESTMENT ADVISORY AGREEMENT INVESTMENT ADVISORY AGREEMENT made as of the 1st day of November, 2004 and supplemented as of April 24, 2008, by and between the registered investment companies, including any portfolio/series thereof, as set forth on Schedule A (each, a "Fund" and collectively, the "Funds") as may be amended from time to time, and Morgan Stanley Investment Advisors Inc., a Delaware corporation (hereinafter called the "Investment Adviser"): WHEREAS, each Fund is engaged in business as an open-end management investment company or as a closed-end management investment company, as identified as such on Schedule A, and is registered as such under the Investment Company Act of 1940, as amended (the "Act"); and WHEREAS, the Investment Adviser is registered as an investment adviser under the Investment Advisers Act of 1940, and engages in the business of acting as investment adviser; and WHEREAS, each Fund entered into an Investment Management Agreement to provide management and investment advisory services with the Investment Adviser, or its predecessor as the case may be, effective as of the date set forth in Schedule A (the "Current Investment Management Agreements"); and WHEREAS, as of May 1, 2004, the Current Investment Management Agreements were amended and restated to combine the Current Investment Management Agreements into a single Amended and Restated Investment Management Agreement (the "Amended and Restated Investment Management Agreement") to reflect the current parties to such agreements and to make other ministerial changes designed to facilitate the administration of the Amended and Restated Investment Management Agreement; and WHEREAS, each Fund desires to retain the Investment Adviser to render investment advisory services in the manner and on the terms and conditions hereinafter set forth; and WHEREAS, the Investment Adviser desires to be retained to perform said services on said terms and conditions; and WHEREAS, each Fund and the Investment Adviser desires to provide for the administrative and other management services that the Investment Adviser provided under the Amended and Restated Investment Management Agreement in a separate Administration Agreement (the "Administration Agreement") to be entered into by each Fund with Morgan Stanley Services Company Inc.; and WHEREAS, this Agreement further amends and restates the Amended and Restated Investment Management Agreement to remove the provisions relating to the administrative and other management services, and to reduce the fees payable by the Funds hereunder but otherwise reflects the current parties to the Amended and Restated Investment Management Agreement (and Annexes 1, 2 and 3 will be amended, if necessary, to add a Fund when such Fund is first included in Schedule A); WITNESSETH In consideration of the mutual covenants and agreements of the parties hereto as hereinafter contained, each Fund and the Investment Adviser agree as follows: 1. Each Fund hereby retains the Investment Adviser to act as investment adviser of such Fund and, subject to the supervision of the Trustees/Directors, to supervise the investment activities of such Fund as hereinafter set forth. Without limiting the generality of the foregoing, the Investment Adviser shall obtain and evaluate such information and advice relating to the economy, securities, securities markets and commodities markets as it deems necessary or useful to discharge its duties hereunder; shall continuously manage the assets of each Fund in a manner consistent with the investment objectives and policies of a Fund; shall determine the securities to be purchased, sold or otherwise disposed of by a Fund and the timing of such purchases, sales and dispositions; and shall take such further action, including the placing of purchase and sale orders on behalf of a Fund, as the Investment Adviser shall deem necessary or appropriate. The Investment Adviser shall also furnish to or place at the disposal of each Fund such of the information, evaluations, analyses and opinions formulated or obtained by the Investment Adviser in the discharge of its duties as each Fund may, from time to time, reasonably request. 2. In connection with those Funds identified in Annex 1 to this Agreement and as permitted in their respective Current Investment Management Agreements, and in connection with all Funds added to Schedule A after the date hereof, the Investment Adviser may, subject to the approval of the Board of Trustees/Directors (and in the case of the Morgan Stanley European Growth Fund Inc., Morgan Stanley International SmallCap Fund, Morgan Stanley Japan Fund, Morgan Stanley Pacific Growth Fund Inc. and Morgan Stanley Variable Investment Series (on behalf of its European Growth Portfolio) shall) at its own expense, enter into a Sub-Advisory Agreement with a Sub-Advisor to make determinations as to certain or all of the securities and commodities to be purchased, sold or otherwise disposed of by such Funds and the timing of such purchases, sales and dispositions and to take such further action, including the placing of purchase and sale orders on behalf of such Funds as the Sub-Advisor, in consultation with the Investment Adviser, shall deem necessary or appropriate; provided that the Investment Adviser shall be responsible for monitoring compliance by such Sub-Advisor with the investment policies and restrictions of such Funds and with such other limitations or directions as the Trustees/Directors of the Fund may from time to time prescribe. 3. The Investment Adviser shall, at its own expense, maintain such staff and employ or retain such personnel and consult with such other persons as it shall from time to time determine to be necessary or useful to the performance of its obligations under this Agreement. Without limiting the generality of the foregoing, the staff and personnel of the Investment Adviser shall be deemed to include persons employed or otherwise retained by the Investment Adviser to furnish statistical and other factual data, advice regarding economic factors and trends, information with respect to technical and scientific developments, and such other information, advice and assistance as the Investment Adviser may desire. 4. Each Fund will, from time to time, furnish or otherwise make available to the Investment Adviser such financial reports, proxy statements and other information relating to the business and affairs of such Fund as the Investment Adviser may reasonably require in order to discharge its duties and obligations hereunder. The Investment Adviser shall, as agent for each Fund, maintain the Fund's records required in connection with the performance of its obligations under this Agreement and required to be maintained under the Act. All such records so maintained shall be the property of the Funds and, upon request therefor, the Investment Adviser shall surrender to each Fund such of the records so requested. 5. The Investment Adviser shall bear the cost of rendering the investment advisory and supervisory services to be performed by it under this Agreement, and shall, at its own expense, pay the -2- compensation of the officers and employees, if any, of the Funds who are also directors, officers or employees of the Investment Adviser. 6. Except as otherwise provided in the Administration Agreement, each Fund assumes and shall pay or cause to be paid all other expenses of such Fund, including without limitation: fees and expenses payable under the Administration Agreement, the charges and expenses of any registrar, any custodian or depository appointed by the Fund for the safekeeping of its cash, portfolio securities and commodities and other property, and any stock transfer or dividend agent or agents appointed by the Fund; brokers' commissions chargeable to the Fund in connection with portfolio securities transactions to which the Fund is a party; all taxes, including securities and commodities issuance and transfer taxes, and fees payable by the Fund to Federal, State or other governmental agencies; the cost and expense of engraving or printing share certificates representing shares of the Fund; all costs and expenses in connection with the registration and maintenance of registration of the Fund and its shares with the Securities and Exchange Commission and various states and other jurisdictions (including filing fees and legal fees and disbursements of counsel); the cost and expense of printing (including typesetting) and distributing prospectuses of the Fund and supplements thereto to the Fund's shareholders; all expenses of shareholders' and Trustees'/Directors' meetings and of preparing, printing and mailing proxy statements and reports to shareholders; fees and travel expenses of Trustees/Directors or members of any advisory board or committee who are not employees of the Investment Adviser or any corporate affiliate of the Investment Adviser; all expenses incident to the payment of any dividend, distribution, withdrawal or redemption (and in the case of the closed-end funds, any dividend or distribution program), whether in shares or in cash; charges and expenses of any outside pricing service used for pricing of the Fund's shares; charges and expenses of legal counsel, including counsel to the Trustees/Directors of the Fund who are not interested persons (as defined in the Act) of the Fund or the Investment Adviser, and of independent accountants in connection with any matter relating to the Fund; membership dues of the Investment Company Institute (and in the case of the closed-end funds, other appropriate industry associations); interest payable on Fund borrowings; (and in the case of the closed-end funds, fees and expenses incident to the listing of the funds' shares on any stock exchange); postage; insurance premiums on property or personnel (including officers and Trustees/Directors) of the Fund which inure to its benefit; extraordinary expenses (including but not limited to legal claims and liabilities and litigation costs and any indemnification related thereto); and all other charges and costs of the Fund's operation. 7. For the services to be rendered, the facilities furnished, and the expenses assumed by the Investment Adviser, each Fund shall pay to the Investment Adviser monthly compensation determined by applying the annual rates to the Fund's daily net assets (weekly net assets with respect to each closed-end fund) as set forth in Schedule A, provided, however, that in no event will the sum of the fee payable hereunder by each Fund to the Investment Adviser hereunder and the fee payable by that Fund under the Administration Agreement, as that agreement may be amended from time to time, exceed the fee payable by the Fund under the Amended and Restated Investment Management Agreement. For the purposes of calculating the advisory fee hereunder and the administrative fee under the Administration Agreement for the closed-end funds referenced on Annex 2 the liquidation preference of any Preferred Shares issued by each of such Funds will not be deducted from the Fund's total assets. In addition, for purposes of this calculation, an amount up to the aggregate amount of any other borrowings may be included in the Fund's advisory fee calculation. Except as hereinafter set forth, compensation under this Agreement shall be calculated and accrued daily and the amounts of the daily accruals shall be paid monthly. Such calculations shall be made by applying 1/365ths of the annual rates to each Fund's net assets each day determined as of the close of business on that day or the last previous business day. In connection with the closed-end funds identified on Schedule A, compensation under this Agreement shall be calculated and accrued weekly and paid monthly by applying the annual rates to the average weekly net assets of the Fund determined as of the close of the last business day of each week, -3- except for such closed-end funds as may be specified in Schedule A. At the request of the Investment Adviser, compensation hereunder shall be calculated and accrued at more frequent intervals in a manner consistent with the calculation of fees on a weekly basis. If this Agreement becomes effective subsequent to the first day of a month or shall terminate before the last day of a month, compensation for that part of the month this Agreement is in effect shall be prorated in a manner consistent with the calculation of the fees as set forth in Schedule A. Subject to the provisions of paragraph 8 hereof, payment of the Investment Adviser's compensation for the preceding month shall be made as promptly as possible after completion of the computation contemplated by paragraph 8 hereof. 8. This section is applicable only to those Funds listed on Annex 3 and subject to any fund specific requirements set forth in Annex 3. In the event the operating expenses of those Funds identified in Annex 3 to this Agreement, including amounts payable to the Investment Adviser pursuant to paragraph 7 hereof and the amounts payable by the Funds under the Administration Agreement, for any fiscal year ending on a date on which this Agreement is in effect, exceed the expense limitations applicable to a Fund imposed by state securities laws or regulations thereunder, as such limitations may be raised or lowered from time to time, the Investment Adviser shall reduce its advisory fee to the extent of such excess and, if required, pursuant to any such laws or regulations, will reimburse a Fund for annual operating expenses in excess of any expense limitation that may be applicable; provided, however, there shall be excluded from such expenses the amount of any interest, taxes, brokerage commissions and extraordinary expenses (including but not limited to legal claims and liabilities and litigation costs and any indemnification related thereto) paid or payable by a Fund. Such reduction, if any, shall be computed and accrued daily (and in the case of the closed-end funds, weekly), shall be settled on a monthly basis, and shall be based upon the expense limitation applicable to a Fund as at the end of the last business day of the month. Should two or more such expense limitations be applicable as at the end of the last business day of the month, (and in the case of the closed-end funds, as at the end of the last full week of the month) that expense limitation which results in the largest reduction in the Investment Adviser's fee shall be applicable. 9. The Investment Adviser will use its best efforts in the supervision and management of the investment activities of each Fund, but in the absence of willful misfeasance, bad faith, gross negligence or reckless disregard of its obligations hereunder, the Investment Adviser shall not be liable to a Fund or any of its investors for any error of judgment or mistake of law or for any act or omission by the Investment Adviser or for any losses sustained by a Fund or its investors. 10. Nothing contained in this Agreement shall prevent the Investment Adviser or any affiliated person of the Investment Adviser from acting as investment adviser or manager for any other person, firm or corporation and shall not in any way bind or restrict the Investment Adviser or any such affiliated person from buying, selling or trading any securities or commodities for their own accounts or for the account of others for whom they may be acting. Nothing in this Agreement shall limit or restrict the right of any trustee/director, officer or employee of the Investment Adviser to engage in any other business or to devote his or her time and attention in part to the management or other aspects of any other business whether of a similar or dissimilar nature. 11. This Agreement shall continue in effect with respect to each Fund for a period of up to one year from the effective date hereof (except with respect to any Fund added to Schedule A of this Agreement after the date hereof, for an initial period of two years from the date that such Fund is added) and thereafter provided such continuance is approved at least annually by the vote of holders of a majority (as defined in the Act) of the outstanding voting securities of each Fund (if applicable, Common Shares and Preferred Shares voting together as a single class) or by the Board of Trustees/Directors of such -4- Fund; provided that in either event such continuance is also approved annually by the vote of a majority of the Trustees/Directors of such Fund who are not parties to this Agreement or "interested persons" (as defined in the Act) of any such party, which vote must be cast in person at a meeting called for the purpose of voting on such approval; provided, however, that (a) each Fund may, at any time and without the payment of any penalty, terminate this Agreement upon thirty days' written notice to the Investment Adviser, either by majority vote of the Board of Trustees/Directors of such Fund or by the vote of a majority of the outstanding voting securities of such Fund (if applicable, Common Shares and Preferred Shares voting together as a single class); (b) this Agreement shall immediately terminate in the event of its assignment (within the meaning of the Act) unless such automatic termination shall be prevented by an exemptive order of the Securities and Exchange Commission; and (c) the Investment Adviser may terminate this Agreement without payment of penalty on thirty days' written notice to such Fund. Any notice under this Agreement shall be given in writing, addressed and delivered, or mailed post-paid, to the other party at the principal office of such party. Any approval of this Agreement by the holders of a majority of the outstanding voting securities of any portfolio/series of a Fund shall be effective to continue this Agreement with respect to such portfolio/series notwithstanding (a) that this Agreement has not been approved by the holders of a majority of the outstanding voting securities of any other portfolio/series or (b) that this Agreement has not been approved by the vote of a majority of the outstanding voting securities of the Fund of which it is a portfolio/series unless such approval shall be required by any other applicable law or otherwise. 12. This Agreement may be amended by the parties without the vote or consent of shareholders of a Fund to supply any omission, to cure, correct or supplement any ambiguous, defective or inconsistent provision hereof, or if they deem it necessary to conform this Agreement to the requirements of applicable federal laws or regulations, but neither the Funds nor the Investment Adviser shall be liable for failing to do so. 13. This Agreement shall be construed in accordance with the law of the State of New York and the applicable provisions of the Act. To the extent the applicable law of the State of New York, or any of the provisions herein, conflicts with the applicable provisions of the Act, the latter shall control. 14. The Declaration of Trust, together with all amendments thereto establishing each Fund identified in Schedule A as a Massachusetts business trust (the "Declaration"), is on file in the office of the Secretary of the Commonwealth of Massachusetts, provides that the name of such Funds refers to the Trustees under the Declaration collectively as Trustees, but not as individuals or personally; and no Trustee, shareholder, officer, employee or agent of such Funds shall be held to any personal liability, nor shall resort be had to their private property for the satisfaction of any obligation or claim or otherwise, in connection with the affairs of such Funds, but the Trust Estate only shall be liable. 15. The Investment Adviser and each Fund agree that the name Morgan Stanley is a property right of the Investment Adviser or its parent. Each Fund agrees and consents that (i) it will only use the name Morgan Stanley as a component of its name and for no other purpose, (ii) it will not purport to grant to any third party the right to use the Name for any purpose, (iii) the Investment Adviser or its parent, or any corporate affiliate of the Investment Adviser's parent, may use or grant to others the right to use the name Morgan Stanley, or any combination or abbreviation thereof, as all or a portion of a corporate or business name or for any commercial purpose, including a grant of such right to any other investment company, (iv) at the request of the Investment Adviser or its parent or any corporate affiliate of the Investment Adviser's parent, each Fund will take such action as may be required to provide its consent to the use name Morgan Stanley, or any combination or abbreviation thereof, by the Investment Adviser or its parent or any corporate affiliate of the Investment Adviser's parent, or by any person to whom the Investment Adviser or its then current parent or a corporate affiliate of the Investment Adviser's parent -5- shall have granted the right to such use, and (v) upon the termination of any investment advisory agreement into which a corporate affiliate of the Investment Adviser's parent and each Fund may enter, or upon termination of affiliation of the Investment Adviser with its parent, each Fund shall, upon request of the Investment Adviser or its parent or any corporate affiliate of the Investment Adviser's parent, cease to use the Name as a component of its name, and shall not use the name, or any combination or abbreviation thereof, as a part of its name or for any other commercial purpose, and shall cause its officers, trustees/directors and shareholders to take any and all actions which the Investment Adviser or its parent or any corporate affiliate of the Investment Adviser's parent, may request to effect the foregoing and to reconvey to the Investment Adviser's parent any and all rights to such name. -6- IN WITNESS WHEREOF, the parties hereto have executed and delivered this Agreement, on April 24, 2008, in New York, New York. ON BEHALF OF EACH FUND AS SET FORTH IN SCHEDULE A By: //s/ Amy R.Doberman ------------------------------------ Amy R. Doberman Vice President Attest: /s/ Joanne Antico - ------------------------------------- Joanne Antico MORGAN STANLEY INVESTMENT ADVISORS INC. By: /s/ Stefanie V. Chang Yu ------------------------------------ Stefanie V. Chang Yu Managing Director Attest: /s/ Yvette K. Hayes - ------------------------------------- Yvette K. Hayes SCHEDULE A As of January 15, 2009 All of the Funds referenced below are organized as Massachusetts business trusts unless otherwise indicated. I. OPEN-END FUNDS: Monthly Compensation calculated daily by applying the following annual rates to a fund's daily net assets: EFFECTIVE DATE OF AGREEMENT AND ANY AMENDMENTS ENTERED FIXED INCOME FUNDS INTO PRIOR TO MAY 1, 2004 INVESTMENT ADVISORY FEE ------------------ ------------------------------- --------------------------------------------------------- Morgan Stanley California Tax- Free 05/31/97, as amended on 0.47% of the portion of the daily net assets not Income Fund 04/30/98 exceeding $500 million; 0.445% of the portion of the daily net assets exceeding $500 million but not exceeding $750 million; 0.42% of the portion of the daily net assets exceeding $750 million but not exceeding $1 billion; and 0.395% of the portion of the daily net assets exceeding $1 billion. Morgan Stanley Convertible Securities 05/31/97 0.52% of the portion of the daily net assets not Trust exceeding $750 million; 0.47% of the portion of the daily net assets exceeding $750 million but not exceeding $1 billion; 0.42% of the portion of the daily net assets of the exceeding $1 billion but not exceeding $1.5 billion; 0.395% of the portion of the daily net assets exceeding $1.5 billion but not exceeding $2 billion; 0.37% of the portion of the daily net assets exceeding $2 billion but not exceeding $3 billion; and 0.345% of the portion of the daily net assets exceeding $3 billion. Morgan Stanley Mortgage Securities Trust 05/31/97, as amended on 0.47% of the portion of the daily net assets not 04/30/98 exceeding $1 billion; 0.445% of the portion of the daily net assets exceeding $1 billion but not exceeding $1.5 billion; 0.42% of the portion of the daily net assets exceeding $1.5 billion but not exceeding $2 billion; 0.395% of the portion of the daily net assets exceeding $2 billion but not exceeding $2.5 billion; 0.37% of the portion of the daily net assets exceeding $2.5 billion but not exceeding $5 billion; 0.345% of the portion of the daily net assets exceeding $5 billion but not exceeding $7.5 billion; 0.32% of the portion of the daily net assets exceeding $7.5 billion but Sch.A-1 EFFECTIVE DATE OF AGREEMENT AND ANY AMENDMENTS ENTERED FIXED INCOME FUNDS INTO PRIOR TO MAY 1, 2004 INVESTMENT ADVISORY FEE ------------------ ------------------------------- --------------------------------------------------------- not exceeding $10 billion; 0.295% of the portion of the daily net assets exceeding $10 billion but not exceeding $12.5 billion; and 0.27% of the portion of the daily net assets exceeding $12.5 billion. Morgan Stanley Flexible Income Trust 05/31/97, as amended on 0.32% of the daily net assets. 04/30/98 Morgan Stanley High Yield Securities 05/31/97 0.42% of the portion of the daily net assets not Inc. (Maryland corporation) exceeding $500 million; 0.345% of the portion of the daily net assets exceeding $500 million but not exceeding $750 million; 0.295% of the portion of the daily net assets exceeding $750 million but not exceeding $1 billion; 0.27% of the portion of the daily net assets exceeding $1 billion but not exceeding $2 billion; 0.245% of the portion of the daily net assets exceeding $2 billion but not exceeding $3 billion; and 0.22% of the portion of the daily net assets exceeding $3 billion. Morgan Stanley Limited Duration Fund 05/31/97, as amended on 0.52% of the portion of the daily net assets not 04/30/98, 05/01/04 exceeding $1 billion; 0.47% of the portion of the daily net assets exceeding $1 billion but not exceeding $2 billion; and 0.42% of the portion of the daily net assets exceeding $2 billion. Morgan Stanley Limited Duration U.S. 05/31/97, as amended on 0.27% of the daily net assets not exceeding $1 billion; Government Trust 04/30/98 and 0.25% of the portion of the daily net assets exceeding $1 billion. Morgan Stanley Limited Term Municipal 05/31/97, as amended on 0.42% of the daily net assets. Trust 04/30/98 Morgan Stanley New York Tax- Free 05/31/97, as amended on 0.47% of the portion of the daily net assets not Income Fund 04/30/98 exceeding $500 million; and 0.445% of the portion of the daily net assets exceeding $500 million. Morgan Stanley Income Trust 05/31/97, as amended on 0.42% of the portion of the daily net assets not 04/30/98 exceeding $500 million; 0.35% of the portion of the daily net assets exceeding $500 million but not exceeding $1.25 billion; and 0.22% of the portion of the daily net assets exceeding $1.25 billion. Sch.A-2 EFFECTIVE DATE OF AGREEMENT AND ANY AMENDMENTS ENTERED FIXED INCOME FUNDS INTO PRIOR TO MAY 1, 2004 INVESTMENT ADVISORY FEE ------------------ ------------------------------- --------------------------------------------------------- Morgan Stanley Select Dimensions 05/31/97, as amended on 0.32% of the daily net assets. Investment Series-- 04/30/98 - - Flexible Income Portfolio Morgan Stanley Series Funds - -Morgan Stanley Commodities Alpha Fund March 5, 2008 0.80% of the daily net assets - -Morgan Stanley Commodities Alpha Fund March 5, 2008 None (Cayman)Ltd. Morgan Stanley Tax-Exempt Securities 05/31/97, as amended on 0.42% of the portion of the daily net assets not Trust 04/30/98, 05/01/02 exceeding $500 million; 0.345% of the portion of the daily net assets exceeding $500 million but not exceeding $750 million; 0.295% of the portion of the daily net assets exceeding $750 million but not exceeding $1 billion; 0.27% of the portion of the daily net assets exceeding $1 billion but not exceeding $1.25 billion; 0.245% of the portion of the daily net assets exceeding $1.25 billion but not exceeding $2.5 billion; and 0.22% of the portion of the daily net assets exceeding $2.5 billion. Morgan Stanley U.S. Government 05/31/97, as amended on 0.42% of the portion of the daily net assets not Securities Trust 04/30/98 exceeding $1 billion; 0.395% of the portion of the daily net assets exceeding $1 billion but not exceeding $1.5 billion; 0.37% of the portion of the daily net assets exceeding $1.5 billion but not exceeding $2 billion; 0.345% of the portion of the daily net assets exceeding $2 billion but not exceeding $2.5 billion; 0.32% of the portion of the daily net assets exceeding $2.5 billion but not exceeding $5 billion; 0.295% of the portion of the daily net assets exceeding $5 billion but not exceeding $7.5 billion; 0.27% of the portion of the daily net assets exceeding $7.5 billion but not exceeding $10 billion; 0.245% of the portion of the daily net assets exceeding $10 billion but not exceeding $12.5 billion; and 0.22% of the portion of the daily net assets Sch.A-3 EFFECTIVE DATE OF AGREEMENT AND ANY AMENDMENTS ENTERED FIXED INCOME FUNDS INTO PRIOR TO MAY 1, 2004 INVESTMENT ADVISORY FEE ------------------ ------------------------------- --------------------------------------------------------- exceeding $12.5 billion. Morgan Stanley Variable Investment Series-- - - High Yield Portfolio 05/31/97, as amended on 0.42% of the portion of the daily net assets not 05/01/98, 05/01/99, 05/01/00 exceeding $500 million; 0.345% of the portion of the daily net assets exceeding $500 million but not exceeding $750 million; 0.295% of the portion of the daily net assets exceeding $750 million but not exceeding $1 billion; 0.27% of the portion of the daily net assets exceeding $1 billion but not exceeding $2 billion; 0.245% of the portion of the daily net assets exceeding $2 billion but not exceeding $3 billion; and 0.22% of the portion of the daily net assets exceeding $3 billion. - - Income Plus Portfolio 05/31/97, as amended on 0.42% of the portion of the daily net assets not 05/01/98, 05/01/99, 05/01/00 exceeding $500 million; 0.35% of the portion of the daily net assets exceeding $500 million but not exceeding $1.25 billion; and 0.22% of the portion of the daily net assets exceeding $1.25 billion. - - Limited Duration Portfolio 05/31/97, as amended on 0.30% of the daily net assets. 05/01/98, 05/01/99, 05/01/00 Sch.A-4 EFFECTIVE DATE OF AGREEMENT EQUITY, BALANCED AND AND ANY AMENDMENTS ENTERED ASSET ALLOCATION FUNDS INTO PRIOR TO MAY 1, 2004 INVESTMENT ADVISORY FEE ---------------------- ------------------------------- --------------------------------------------------------- Morgan Stanley Balanced Fund 05/31/97, as amended on 0.52% of the portion of the daily net assets not 04/30/98, 05/01/99 exceeding $500 million; and 0.495% of the portion of the daily net assets exceeding $500 million. Morgan Stanley Capital Opportunities 06/28/99 0.67% of the portion of the daily net assets not Trust exceeding $500 million; 0.645% of the portion of the daily net assets exceeding $500 million but not exceeding $2 billion; 0.62% of the portion of the daily net assets exceeding $2 billion but not exceeding $3 billion; and 0.595% of the portion of the daily net assets exceeding $3 billion. Morgan Stanley Dividend Growth 05/31/97, as amended on 0.545% of the portion of the daily net assets not Securities Inc. 04/30/98 exceeding $250 million; 0.42% of the portion of the daily net assets exceeding $250 million but not (Maryland corporation) exceeding $1 billion; 0.395% of the portion of the daily net assets exceeding $1 billion but not exceeding $2 billion; 0.37% of the portion of the daily net assets exceeding $2 billion but not exceeding $3 billion; 0.345% of the portion of the daily net assets exceeding $3 billion but not exceeding $4 billion; 0.32% of the portion of the daily net assets exceeding $4 billion but not exceeding $5 billion; 0.295% of the portion of the daily net assets exceeding $5 billion but not exceeding $6 billion; 0.27% of the portion of the daily net assets exceeding $6 billion but not exceeding $8 billion; 0.245% of the portion exceeding $8 billion but not exceeding $10 billion; 0.22% of the portion of the daily net assets exceeding $10 billion but not exceeding $15 billion; and 0.195% of the portion of the daily net assets exceeding $15 billion. Morgan Stanley Equally-Weighted S&P 05/31/97, as amended on 0.12% of the portion of the daily net assets not 500 Fund 05/01/98 exceeding $2 billion; and 0.10% of the portion of the daily net assets exceeding $2 billion. Sch.A-5 EFFECTIVE DATE OF AGREEMENT EQUITY, BALANCED AND AND ANY AMENDMENTS ENTERED ASSET ALLOCATION FUNDS INTO PRIOR TO MAY 1, 2004 INVESTMENT ADVISORY FEE ---------------------- ------------------------------- --------------------------------------------------------- Morgan Stanley European Equity Fund 05/31/97, as amended on 0.87% of the portion of the daily net assets not Inc. 04/30/98, 12/01/98, 05/01/00 exceeding $500 million; 0.82% of the portion of the daily net assets exceeding $500 million but not (Maryland corporation) exceeding $2 billion; 0.77% of the portion of the daily net assets exceeding $2 billion but not exceeding $3 billion; and 0.745% of the portion of the daily net assets exceeding $3 billion. Morgan Stanley Focus Growth Fund 05/31/97 0.545% of the portion of the daily net assets not exceeding $250 million; 0.42% of the portion of the daily net assets exceeding $250 million but not exceeding $2.5 billion; 0.395% of the portion of the daily net assets exceeding $2.5 billion but not exceeding $3.5 billion; 0.37% of the portion of the daily net assets exceeding $3.5 billion but not exceeding $4.5 billion; and 0.345% of the portion of the daily net assets exceeding $4.5 billion. Morgan Stanley Fundamental Value Fund 08/19/02 0.67% of the portion of the daily net assets not exceeding $500 million; and 0.62% of the portion of the daily net assets exceeding $500 million. Morgan Stanley Global Advantage Fund 11/06/97, as amended on 0.57% of the portion of the daily net assets not 05/01/98 exceeding $1.5 billion; and 0.545% of the portion of the daily net assets exceeding $1.5 billion. Morgan Stanley Global Dividend Growth 05/31/97, as amended on 0.67% of the portion of the daily net assets not Securities 05/01/98 exceeding $1 billion; 0.645% of the portion of the daily net assets exceeding $1 billion but not exceeding $1.5 billion; 0.62% of the portion of the daily net assets exceeding $1.5 billion but not exceeding $2.5 billion; 0.595% of the portion of the daily net assets exceeding $2.5 billion but not exceeding $3.5 billion; 0.57% of the portion of the daily net assets exceeding $3.5 billion but not exceeding $4.5 billion; and 0.545% of the portion of the daily net assets exceeding $4.5 billion. Sch.A-6 EFFECTIVE DATE OF AGREEMENT EQUITY, BALANCED AND AND ANY AMENDMENTS ENTERED ASSET ALLOCATION FUNDS INTO PRIOR TO MAY 1, 2004 INVESTMENT ADVISORY FEE ---------------------- ------------------------------- --------------------------------------------------------- Morgan Stanley Global Infrastructure 05/31/97, as amended on 0.57% of the portion of the daily net assets not Fund 04/30/98 exceeding $500 million; 0.47% of the portion of the daily net assets exceeding $500 million but not exceeding $1 billion; 0.445% of the portion of the daily net assets exceeding $1 billion but not exceeding $1.5 billion; 0.42% of the portion of the daily net assets exceeding $1.5 billion but not exceeding $2.5 billion; 0.395% of the portion of the daily net assets exceeding $2.5 billion but not exceeding $3.5 billion; 0.37% of the portion of the daily net assets exceeding $3.5 billion but not exceeding $5 billion; and 0.345% of the portion of the daily net assets exceeding $5 billion. Morgan Stanley Health Sciences Trust 05/31/97, as amended on 0.92% of the portion of the daily net assets not 04/30/98, 05/01/01 exceeding $500 million; 0.87% of the portion of the daily net assets exceeding $500 million but not exceeding $1 billion; and 0.845% of the portion of the daily net assets exceeding $1 billion. Morgan Stanley International Fund 05/04/99, as amended on 0.65% of the portion of the daily net assets not 05/01/01 exceeding $1 billion; and 0.60% of the portion of the daily net assets exceeding $1 billion. Morgan Stanley International Value 02/14/01 0.80% of the daily net assets. Equity Fund Morgan Stanley Mid Cap Growth Fund 05/31/97, as amended on 0.42% of the portion of the daily net assets not 04/30/98 exceeding $500 million; and 0.395% of the portion of the daily net assets exceeding $500 million. Morgan Stanley Mid-Cap Value Fund 05/16/01 0.72% of the portion of daily net assets not exceeding $1 billion; and 0.65% of the portion of daily net assets exceeding $1 billion. Morgan Stanley Natural Resource 05/31/97, as amended on 0.545% of the portion of the daily net assets not Development Securities Inc. 04/30/98 exceeding $250 million; and 0.42% of the portion of the daily net assets exceeding $250 million. Sch.A-7 EFFECTIVE DATE OF AGREEMENT EQUITY, BALANCED AND AND ANY AMENDMENTS ENTERED ASSET ALLOCATION FUNDS INTO PRIOR TO MAY 1, 2004 INVESTMENT ADVISORY FEE ---------------------- ------------------------------- --------------------------------------------------------- Morgan Stanley Pacific Growth Fund Inc. 05/31/97, as amended on 0.87% of the portion of the daily net assets not 04/30/98, 11/01/98 exceeding $1 billion; 0.82% of the portion of the daily (Maryland corporation) net assets exceeding $1 billion but not exceeding $2 billion; and 0.77% of the portion of the daily net assets exceeding $2 billion. Morgan Stanley Real Estate Fund 02/09/99 0.80% of the portion of the daily net assets not exceeding $500 million; 0.75% of the portion of the daily net assets exceeding $500 million but not exceeding $1 billion; and 0.70% of the portion of the daily net assets exceeding $1 billion. Morgan Stanley Select Dimensions Investment Series- - - Balanced Portfolio 05/31/97, as amended on 0.52% of the portion of the daily net assets not 03/02/98, 05/01/98, 05/10/00 exceeding $500 million; and 0.495% of the portion of the daily net assets exceeding $500 million. - - Capital Growth Portfolio 05/31/97, as amended on 0.50% of the portion of the daily net assets not 03/02/98, 05/01/98, 05/01/00 exceeding $1 billion; 0.45% of the portion of the daily net assets exceeding $1 billion but not exceeding $2 billion; 0.40% of the portion of the daily net assets exceeding $2 billion but not exceeding $3 billion; and 0.35% of the portion of the daily net assets exceeding $3 billion. - - Capital Opportunities Portfolio 05/31/97, as amended on 0.67% of the portion of the daily net assets not 03/02/98, 05/01/98, 05/01/00 exceeding $500 million; 0.645% of the portion of the daily net assets exceeding $500 million but not exceeding $2 billion; 0.62% of the portion of the daily net assets exceeding $2 billion but not exceeding $3 billion; and 0.595% of the portion of the daily net assets exceeding $3 billion. Sch.A-8 EFFECTIVE DATE OF AGREEMENT EQUITY, BALANCED AND AND ANY AMENDMENTS ENTERED ASSET ALLOCATION FUNDS INTO PRIOR TO MAY 1, 2004 INVESTMENT ADVISORY FEE ---------------------- ------------------------------- --------------------------------------------------------- - - Dividend Growth Portfolio 05/31/97, as amended on 0.545% of the portion of the daily net assets not 03/02/98, 05/01/98, 05/01/00 exceeding $250 million; 0.42% of the portion of the daily net assets exceeding $250 million but not exceeding $1 billion; 0.395% of the portion of the daily net assets exceeding $1 billion but not exceeding $2 billion; and 0.37% of the portion of the daily net assets exceeding $2 billion. - - Equally-Weighted S&P 500 Portfolio 05/31/97, as amended on 0.12% of the portion of the daily net assets not 04/30/98 exceeding $2 billion; and 0.10% of the portion of the daily net assets exceeding $2 billion. - - Focus Growth Portfolio 05/31/97, as amended on 0.545% of the portion of the daily net assets not 03/02/98, 05/01/98, 05/01/00 exceeding $250 million; 0.42% of the portion of the daily net assets exceeding $250 million but not exceeding $2.5 billion; 0.395% of the daily net assets exceeding $2.5 billion but not exceeding $3.5 billion, 0.37% of the portion of the daily net assets exceeding $3.5 billion but not exceeding $4.5 billion; and 0.345% of the portion of the daily net assets exceeding $4.5 billion. - - Global Equity Portfolio 05/31/97, as amended on 0.92% of the daily net assets. 03/02/98, 05/01/98, 05/01/00 - - Global Infrastructure Portfolio 05/31/97, as amended on 0.57% of the portion of the daily net assets not 03/02/98, 05/01/98, 05/01/00 exceeding $500 million; 0.47% of the portion of the daily net assets exceeding $500 million but not exceeding $1 billion; 0.445% of the portion of the daily net assets exceeding $1 billion but not exceeding $1.5 billion; 0.42% of the portion of the daily net assets exceeding $1.5 billion but not exceeding $2.5 billion; 0.395% of the portion of the daily net assets exceeding $2.5 billion but not exceeding $3.5 billion; 0.37% of the portion of the daily net assets exceeding $3.5 billion but not exceeding $5 billion; and 0.345% of the portion of the daily net assets exceeding $5 billion. Sch.A-9 EFFECTIVE DATE OF AGREEMENT EQUITY, BALANCED AND AND ANY AMENDMENTS ENTERED ASSET ALLOCATION FUNDS INTO PRIOR TO MAY 1, 2004 INVESTMENT ADVISORY FEE ---------------------- ------------------------------- --------------------------------------------------------- - -Mid Cap Growth Portfolio 05/31/97, as amended on 0.42% of the portion of the daily net assets not 03/02/98, 05/01/98, 05/01/00 exceeding $500 million; and 0.395% of the portion of the daily net assets exceeding $500 million. Morgan Stanley Series Funds - -Morgan Stanley U.S. Multi-Cap Alpha 06/26/08 0.78% of the portion of the daily net assets not Fund exceeding $1 billion; 0.750% of the portion of the daily net assets exceeding $1 billion but not exceeding $2 billion; and 0.725% of the portion of the daily net assets exceeding $2 billion. Morgan Stanley S&P 500 Index Fund 07/28/97, as amended on 0.12% of the portion of the daily net assets not 04/30/98, 05/01/99, 05/01/04 exceeding $2 billion; and 0.10% of the portion of the daily net assets exceeding $2 billion. The Investment Adviser has agreed to cap the Fund's operating expenses (except for brokerage and 12b-1 fees) by assuming the Fund's "other expenses" and/or waiving its fees under this Agreement and the Administration Agreement to the extent such operating expenses exceed on an annualized basis 0.40% of the average daily net assets of the Fund, which may reduce the fees under this Agreement and the Administration Agreement below 0.20% of the Fund's average daily net assets. Morgan Stanley Small-Mid Special Value 04/04/02 0.67% of the daily net assets. Fund Morgan Stanley Special Growth Fund 06/28/99, as amended on 0.92% of the portion of the daily net assets not 05/01/00 exceeding $1 billion; 0.85% of the portion of the daily net assets exceeding $1 billion but not exceeding $1.5 billion; and 0.80% of the portion of the daily net assets exceeding $1.5 billion. Morgan Stanley Special Value Fund 05/31/97, as amended on 0.67% of the portion of the daily net assets not 04/30/98, 05/01/99 05/01/02 exceeding $500 million; 0.645% of the portion of the daily net assets exceeding $500 million but not exceeding $1 billion; and 0.62% of the portion of the daily net assets exceeding $1 billion. Sch.A-10 EFFECTIVE DATE OF AGREEMENT EQUITY, BALANCED AND AND ANY AMENDMENTS ENTERED ASSET ALLOCATION FUNDS INTO PRIOR TO MAY 1, 2004 INVESTMENT ADVISORY FEE ---------------------- ------------------------------- --------------------------------------------------------- Morgan Stanley Strategist Fund 05/31/97, as amended on 0.42% of the portion of the daily net assets not 05/01/98, 05/01/00 exceeding $1.5 billion; and 0.395% of the portion of the daily net assets exceeding $1.5 billion. Morgan Stanley Technology Fund 05/31/97, as amended on 0.67% of the portion of the daily net assets not 04/30/98, 05/01/00 exceeding $500 million; 0.645% of the portion of the daily net assets exceeding $500 million but not exceeding $3 billion; and 0.62% of the portion of the daily net assets exceeding $3 billion. Morgan Stanley Value Fund 07/22/98, as amended on 0.42% of the portion of daily net assets not exceeding 05/01/02, 05/01/04 $1 billion; 0.37% of the portion of the daily net assets exceeding $1 billion but not exceeding $2 billion; 0.32% of the portion of the daily net assets exceeding $2 billion but not exceeding $3 billion; and 0.27% of the portion of the daily net assets exceeding $3 billion. Morgan Stanley Variable Investment Series- - - Aggressive Equity Portfolio 05/31/97, as amended on 0.67% of the portion of the daily net assets not 05/01/98, 05/01/99, 05/01/00 exceeding $500 million; 0.645% of the portion of the daily net assets exceeding $500 million but not exceeding $2 billion; 0.62% of the portion of the daily net assets exceeding $2 billion but not exceeding $3 billion; and 0.595% of the portion of the daily net assets exceeding $3 billion. - - Capital Opportunities Portfolio 05/31/97, as amended on 0.42% of the portion of the daily net assets not 05/01/98, 05/01/99, 05/01/00 exceeding $1 billion; 0.395% of the portion of the daily net assets exceeding $1 billion but not exceeding $2 billion; and 0.37% of the portion of the daily net assets exceeding $2 billion. - - Dividend Growth Portfolio 05/31/97, as amended on 0.545% of the portion of the daily net assets not 05/01/98, 05/01/99, 05/01/00 exceeding $250 million; 0.42% of the portion of the daily net assets exceeding $250 million but not exceeding $1 billion; 0.395% of the portion of the daily net assets exceeding $1 billion but not exceeding $2 billion; and 0.37% of the portion of the daily net assets exceeding $2 billion. Sch.A-11 EFFECTIVE DATE OF AGREEMENT EQUITY, BALANCED AND AND ANY AMENDMENTS ENTERED ASSET ALLOCATION FUNDS INTO PRIOR TO MAY 1, 2004 INVESTMENT ADVISORY FEE ---------------------- ------------------------------- --------------------------------------------------------- - - European Equity Portfolio 05/31/97, as amended on 0.87% of the portion of daily net assets not exceeding 05/01/98, 05/01/99, 05/01/00 $500 million; 0.82% of the portion of daily net assets exceeding $500 million but not exceeding $2 billion; 0.77% of the portion of the daily net assets exceeding $2 billion but not exceeding $3 billion; and 0.745% of the portion of the daily net assets exceeding $3 billion. - - Global Advantage Portfolio 05/31/97, as amended on 0.57% of the portion of the daily net assets not 05/01/98, 05/01/99, 05/01/00 exceeding $1.5 billion; and 0.545% of the portion of the daily net assets exceeding $1.5 billion. - - Global Dividend Growth Portfolio 05/31/97, as amended on 0.67% of the portion of the daily net assets not 05/01/98, 05/01/99, 05/01/00 exceeding $1 billion; 0.645% of the portion of the daily net assets exceeding $1 billion but not exceeding $1.5 billion; 0.62% of the portion of the daily net assets exceeding $1.5 billion but not exceeding $2.5 billion; 0.595% of the portion of the daily net assets exceeding $2.5 billion but not exceeding $3.5 billion; 0.57% of the portion of the daily net assets exceeding $3.5 billion but not exceeding $4.5 billion; and 0.545% of the portion of the daily net assets exceeding $4.5 billion. - - Global Infrastructure Portfolio 05/31/97, as amended on 0.57% of the portion of the daily net assets not 05/01/98, 05/01/99, 05/01/00 exceeding $500 million; 0.47% of the portion of the daily net assets exceeding $500 million but not exceeding $1 billion; 0.445% of the portion of the daily net assets exceeding $1 billion but not exceeding $1.5 billion; 0.42% of the portion of the daily net assets exceeding $1.5 billion but not exceeding $2.5 billion; 0.395% of the portion of the daily net assets exceeding $2.5 billion but not exceeding $3.5 billion; 0.37% of the portion of the daily net assets exceeding $3.5 billion but not exceeding $5 billion; and 0.345% of the portion of the daily net assets exceeding $5 billion. - - Income Builder Portfolio 05/31/97, as amended on 0.67% of the portion of the daily net assets not 05/01/98, 05/01/99, 05/01/00 exceeding $500 million; and 0.645% of the portion of the daily net assets exceeding $500 million. Sch.A-12 EFFECTIVE DATE OF AGREEMENT EQUITY, BALANCED AND AND ANY AMENDMENTS ENTERED ASSET ALLOCATION FUNDS INTO PRIOR TO MAY 1, 2004 INVESTMENT ADVISORY FEE ---------------------- ------------------------------- --------------------------------------------------------- - - S&P 500 Index Portfolio 05/31/97, as amended on 0.12% of the portion of the daily net assets not 05/01/98, 05/01/99, 05/01/00, exceeding $2 billion; and 0.10% of the portion of the 05/01/04 daily net assets exceeding $2 billion. The Investment Adviser has agreed to cap the Portfolio's operating expenses (except for brokerage and 12b-1 fees) by assuming the Portfolio's "other expenses" and/or waiving its fees under this Agreement and the Administration Agreement to the extent such operating expenses exceed on an annualized basis 0.40% of the average daily net assets of the Portfolio, which may reduce the fees under this Agreement and the Administration Agreement below 0.20% of the Portfolio's average daily net assets. - - Strategist Portfolio 05/31/97, as amended on 0.42% of the portion of the daily net assets not 05/01/98, 05/01/99, 05/01/00 exceeding $1.5 billion; and 0.395% of the portion of the daily net assets exceeding $1.5 billion. Sch.A-13 MONEY MARKET FUNDS ------------------ Active Assets California Tax-Free Trust 05/31/97, as amended on 0.45% of the portion of the daily net assets not 04/30/98 exceeding $500 million; 0.375% of the portion of the daily net assets exceeding $500 million but not exceeding $750 million; 0.325% of the portion of the daily net assets exceeding $750 million but not exceeding $1 billion; 0.30% of the portion of the daily net assets exceeding $1 billion but not exceeding $1.5 billion; 0.275% of the portion of the daily net assets exceeding $1.5 billion but not exceeding $2 billion; 0.25% of the portion of the daily net assets exceeding $2 billion but not exceeding $2.5 billion; 0.225% of the portion of the daily net assets exceeding $2.5 billion but not exceeding $3 billion; and 0.20% of the portion of the daily net assets exceeding $3 billion Active Assets Government Securities 05/31/97, as amended on 0.45% of the portion of the daily net assets not Trust 04/30/98 exceeding $500 million; 0.375% of the portion of the daily net assets exceeding $500 million but not exceeding $750 million; 0.325% of the portion of the daily net assets exceeding $750 million but not exceeding $1 billion; 0.30% of the portion of the daily net assets exceeding $1 billion but not exceeding $1.5 billion; 0.275% of the portion of the daily net assets exceeding $1.5 billion but not exceeding $2 billion; 0.25% of the portion of the daily net assets exceeding $2 billion but not exceeding $2.5 billion; 0.225% of the portion of the daily net assets exceeding $2.5 billion but not exceeding $3 billion; and 0.20% of the portion of the daily net assets exceeding $3 billion. Active Assets Institutional Government 03/08/02 0.10% of the daily net assets. Securities Trust On an ongoing basis, the Investment Adviser has agreed under this Agreement with the Fund to assume Fund operating expenses (except for brokerage fees) to the extent that such operating expenses exceed on an annualized basis 0.20% of the average daily net assets of the Fund. < This may reduce the fees under this Agreement and the Administration Agreement below 0.15% for the Fund. Sch.A-14 MONEY MARKET FUNDS ------------------ Active Assets Institutional Money Trust 01/06/00 0.10% of the daily net assets. On an ongoing basis, the Investment Adviser has agreed under this Agreement with the Fund to assume Fund operating expenses (except for brokerage fees) to the extent that such operating expenses exceed on an annualized basis 0.20% of the average daily net assets of the Fund. < This may reduce the fees under this Agreement and the Administration Agreement below 0.15% for the Fund. Active Assets Money Trust 05/31/97, as amended on 0.45% of the portion of the daily net assets not 04/30/98, 05/01/99, 05/01/01, exceeding $250 million; 0.375% of the portion of the 05/01/02 daily net assets exceeding $250 million but not exceeding $750 million; 0.325% of the portion of the daily net assets exceeding $750 million but not exceeding $1.25 billion; 0.30% of the portion of the daily net assets exceeding $1.25 billion but not exceeding $1.5 billion; 0.275% of the portion of the daily net assets exceeding $1.5 billion but not exceeding $1.75 billion; 0.25% of the portion of the daily net assets exceeding $1.75 billion but not exceeding $2.25 billion; 0.225% of the portion of the daily net assets exceeding $2.25 billion but not exceeding $2.75 billion; 0.20% of the portion of the daily net assets exceeding $2.75 billion but not exceeding $15 billion; 0.199% of the portion of the daily net assets exceeding $15 billion but not exceeding $17.5 billion; 0.198% of the portion of the daily net assets exceeding $17.5 billion but not exceeding $25 billion; 0.197% of the portion of the daily net assets exceeding $25 billion but not exceeding $30 billion; and 0.196% of the portion of the daily net assets exceeding $30 billion. Active Assets Tax-Free Trust 05/31/97, as amended on 0.45% of the portion of the daily net assets not 04/30/98 exceeding $500 million; 0.375% of the portion of the daily net assets exceeding $500 million but not exceeding $750 million; 0.325% of the portion of the daily net assets exceeding $750 million but not exceeding $1 billion; 0.30% of the portion of the daily net assets exceeding $1 billion but not exceeding $1.5 billion; 0.275% of the portion of the daily net assets exceeding $1.5 billion but not Sch.A-15 MONEY MARKET FUNDS ------------------ exceeding $2 billion; 0.25% of the portion of the daily net assets exceeding $2 billion but not exceeding $2.5 billion; 0.225% of the portion of the daily net assets exceeding $2.5 billion but not exceeding $3 billion; 0.20% of the portion of the daily net assets exceeding $3 billion but not exceeding $15 billion; and 0.199% of the portion of daily net assets exceeding $15 billion. Morgan Stanley California Tax- Free 05/31/97, as amended on 0.45% of the portion of the daily net assets not Daily Income Trust 04/30/98 exceeding $500 million; 0.375% of the portion of the daily net assets exceeding $500 million but not exceeding $750 million; 0.325% of the portion of the daily net assets exceeding $750 million but not exceeding $1 billion; 0.30% of the portion of the daily net assets exceeding $1 billion but not exceeding $1.5 billion; 0.275% of the portion of the daily net assets exceeding $1.5 billion but not exceeding $2 billion; 0.25% of the portion of the daily net assets exceeding $2 billion but not exceeding $2.5 billion; 0.225% of the portion of the daily net assets exceeding $2.5 billion but not exceeding $3 billion; and 0.20% of the portion of the daily net assets exceeding $3 billion. Morgan Stanley Liquid Asset Fund Inc. 05/31/97, as amended on 0.45% of the portion of the daily net assets not (Maryland Corporation) 04/30/98, 05/01/01, 05/01/02 exceeding $250 million; 0.375% of the portion of the daily net assets exceeding $250 million but not exceeding $750 million; 0.325% of the portion of the daily net assets exceeding $750 million but not exceeding $1.25 billion; 0.30% of the portion of the daily net assets exceeding $1.25 billion but not exceeding $1.5 billion; 0.275% of the portion of the daily net assets exceeding $1.5 billion but not exceeding $1.75 billion; 0.25% of the portion of the daily net assets exceeding $1.75 billion but not exceeding $2.25 billion; 0.225% of the portion of the daily net assets exceeding $2.25 billion but not exceeding $2.75 billion; 0.20% of the portion of the daily net assets exceeding $2.75 billion but not exceeding $15 billion; 0.199% of the portion of the daily net assets exceeding $15 billion but not exceeding $17.5 billion; 0.198% of the portion of the daily net assets exceeding $17.5 billion but not exceeding $25 billion; 0.197% of the portion of the daily net assets exceeding Sch.A-16 MONEY MARKET FUNDS ------------------ $25 billion but not exceeding $30 billion; and 0.196% of the portion of the daily net assets exceeding $30 billion. Morgan Stanley New York Municipal 05/31/97, as amended on 0.45% of the portion of the daily net assets not Money Market Trust 04/30/98 exceeding $500 million; 0.375% of the portion of the daily net assets exceeding $500 million but not exceeding $750 million; 0.325% of the portion of the daily net assets exceeding $750 million but not exceeding $1 billion; 0.30% of the portion of the daily net assets exceeding $1 billion but not exceeding $1.5 billion; 0.275% of the portion of the daily net assets exceeding $1.5 billion but not exceeding $2 billion; 0.25% of the portion of the daily net assets exceeding $2 billion but not exceeding $2.5 billion; 0.225% of the portion of the daily net assets exceeding $2.5 billion but not exceeding $3 billion; and 0.20% of the portion of the daily net assets exceeding $3 billion. Morgan Stanley Select Dimensions 05/31/97, as amended on 0.45% of the portion of the daily net assets not Investment Series- 03/02/98, 05/01/98, 05/01/00 exceeding $250 million; 0.375% of the portion of the daily net assets exceeding $250 million but not - - Money Market Portfolio exceeding $750 million; 0.325% of the portion of the daily net assets exceeding $750 million but not exceeding $1.25 billion; 0.30% of the portion of the daily net assets exceeding $1.25 billion but not exceeding $1.5 billion; and 0.275% of the portion of the daily net assets exceeding $1.5 billion. Morgan Stanley Tax-Free Daily Income 05/31/97, as amended on 0.45% of the portion of the daily net assets not Trust 04/30/98 exceeding $500 million; 0.375% of the portion of the daily net assets exceeding $500 million but not exceeding $750 million; 0.325% of the portion of the daily net assets exceeding $750 million but not exceeding $1 billion; 0.30% of the portion of the daily net assets exceeding $1 billion but not exceeding $1.5 billion; 0.275% of the portion of the daily net assets exceeding $1.5 billion but not exceeding $2 billion; 0.25% of the portion of the daily net assets exceeding $2 billion but not exceeding $2.5 billion; 0.225% of the portion of the daily net assets exceeding $2.5 billion but not exceeding $3 billion; 0.20% of the portion of daily net assets exceeding $3 billion but not exceeding $15 billion; and 0.199% of the Sch.A-17 MONEY MARKET FUNDS ------------------ portion of the daily net assets exceeding $15 billion. Morgan Stanley U.S. Government Money 05/31/97, as amended on 0.45% of the portion of the daily net assets not Market Trust 04/30/98 exceeding $500 million; 0.375% of the portion of the daily net assets exceeding $500 million but not exceeding $750 million; 0.325% of the portion of the daily net assets exceeding $750 million but not exceeding $1 billion; 0.30% of the portion of the daily net assets exceeding $1 billion but not exceeding $1.5 billion; 0.275% of the portion of the daily net assets exceeding $1.5 billion but not exceeding $2 billion; 0.25% of the portion of the daily net assets exceeding $2 billion but not exceeding $2.5 billion; 0.225% of the portion of the daily net assets exceeding $2.5 billion but not exceeding $3 billion; and 0.20% of the portion of the daily net assets exceeding $3 billion. Morgan Stanley Variable Investment 05/31/97, as amended on 0.45% of the portion of the daily net assets not Series- 05/01/98, 05/01/99, 05/01/00 exceeding $250 million; 0.375% of the portion of the daily net assets exceeding $250 million but not - - Money Market Portfolio exceeding $750 million; 0.325% of the portion of the daily net assets exceeding $750 million but not exceeding $1.25 billion; 0.30% of the portion of the daily net assets exceeding $1.25 billion but not exceeding $1.5 billion; and 0.275% of the portion of the daily net assets exceeding $1.5 billion. Sch.A-18 II. CLOSED-END FUNDS: Monthly compensation calculated weekly by applying the following annual Rates to a fund's weekly net assets (except as indicated)*: Morgan Stanley California Insured Municipal 05/31/97 0.27% of the average weekly net assets. Income Trust Morgan Stanley California Quality Municipal 05/31/97 0.27% of the average weekly net assets. Securities Morgan Stanley Income Securities Inc. 05/31/97 0.42% of the portion of average weekly (Maryland corporation) net assets not exceeding $500 million; and 0.35% of the portion of average weekly net assets exceeding $500 million. Morgan Stanley Insured California Municipal 05/31/97 0.27% of the average weekly net assets. Securities Morgan Stanley Insured Municipal Bond Trust 05/31/97 0.27% of the average weekly net assets. Morgan Stanley Insured Municipal Income Trust 05/31/97 0.27% of the average weekly net assets. Morgan Stanley Insured Municipal Securities 05/31/97 0.27% of the average weekly net assets. Morgan Stanley Insured Municipal Trust 05/31/97 0.27% of the average weekly net assets. Morgan Stanley Municipal Income Opportunities 05/31/97 0.50% of the average weekly net assets. Trust Morgan Stanley Municipal Income Opportunities 05/31/97 0.50% of the average weekly net assets. Trust II Morgan Stanley Municipal Income Opportunities 05/31/97 0.50% of the average weekly net assets. Trust III Morgan Stanley Municipal Premium Income Trust 05/31/97 0.40% of the average weekly net assets. Morgan Stanley New York Quality Municipal 05/31/97 0.27% of the average weekly net assets. Securities Morgan Stanley Quality Municipal Securities 05/31/97 0.27% of the average weekly net assets. Morgan Stanley Quality Municipal Income Trust 05/31/97 0.27% of the average weekly net assets. Morgan Stanley Quality Municipal Investment 05/31/97 0.27% of the average weekly net assets. Trust - ---------- * In addition, for purposes of this calculation, an amount up to the aggregate amount of any other borrowings may be included in the Fund's advisory fee calculation.

Sch.A-19 ANNEX 1 LIST OF FUNDS FOR WHICH THE CURRENT INVESTMENT MANAGEMENT AGREEMENT SPECIFIES SECTION 2 IS APPLICABLE: Morgan Stanley Capital Opportunities Trust Morgan Stanley Fundamental Value Fund Morgan Stanley International Fund Morgan Stanley International Value Equity Fund Morgan Stanley Mid-Cap Value Fund Morgan Stanley Select Dimensions Investment Series Morgan Stanley Small-Mid Special Value Fund Morgan Stanley Special Growth Fund A-1-1 ANNEX 2 LIST OF CLOSED-END FUNDS FOR WHICH THE LIQUIDATION PREFERENCE OF ANY PREFERRED SHARES ISSUED BY SUCH FUND WILL NOT BE DEDUCTED FROM THE FUND'S TOTAL ASSETS FOR PURPOSES OF CALCULATING THE ADVISORY FEE UNDER THIS AGREEMENT AND ADMINISTRATIVE FEE UNDER THE ADMINISTRATION AGREEMENT*: Morgan Stanley California Insured Municipal Income Trust Morgan Stanley California Quality Municipal Securities Morgan Stanley Insured Municipal Bond Trust Morgan Stanley Insured Municipal Income Trust Morgan Stanley Insured Municipal Trust Morgan Stanley Municipal Premium Income Trust Morgan Stanley New York Quality Municipal Securities Morgan Stanley Quality Municipal Income Trust Morgan Stanley Quality Municipal Investment Trust Morgan Stanley Quality Municipal Securities - ---------- * In addition, for purposes of this calculation, an amount up to the aggregate amount of any other borrowings may be included in the Fund's advisory fee calculation. A-3-1 ANNEX 3 LIST OF FUNDS FOR WHICH THE CURRENT INVESTMENT MANAGEMENT AGREEMENT SPECIFIES THAT SECTION 8 IS APPLICABLE AND ANY FUND-SPECIFIC OPERATING EXPENSE LIMITATION: Active Assets California Tax-Free Trust Active Assets Government Securities Trust Active Assets Money Trust Active Assets Tax-Free Trust Morgan Stanley Focus Growth Fund Morgan Stanley Balanced Fund Morgan Stanley California Tax-Free Daily Income Trust Morgan Stanley California Tax-Free Income Fund Morgan Stanley Capital Opportunities Trust Morgan Stanley Convertible Securities Trust Morgan Stanley Dividend Growth Securities Inc. Morgan Stanley Equally-Weighted S&P 500 Fund Morgan Stanley European Equity Fund Inc. Morgan Stanley Mortgage Securities Trust Morgan Stanley Global Dividend Growth Securities Morgan Stanley Global Infrastructure Fund Morgan Stanley Health Sciences Trust Morgan Stanley High Yield Securities Inc. Morgan Stanley Income Securities Inc. (a) 1 1/2 % of the first $30 million of the average weekly net assets of the Fund during such year and 1 % of such average weekly net assets in excess of $30 million; or (b) 25% of the Fund's gross income for such year, the Investment Adviser will pay to the Fund the greater of the excess as computed under (a) or (b). Morgan Stanley Limited Duration Fund Morgan Stanley Limited Duration U.S. Government Trust A-3-1 Morgan Stanley Limited Term Municipal Trust Morgan Stanley Liquid Asset Fund Inc. Morgan Stanley Natural Resource Development Securities Inc. Morgan Stanley New York Municipal Money Market Trust Morgan Stanley Pacific Growth Fund Inc. Morgan Stanley Select Dimensions Investment Series: Balanced Portfolio, Capital Growth Portfolio, Dividend Growth Portfolio, Equally-Weighted S&P 500 Portfolio, Flexible Income Portfolio, Focus Growth Portfolio, Global Equity Portfolio, Global Infrastructure Portfolio, Mid Cap Growth Portfolio and Money Market Portfolio. 2.5% of the average daily net assets of such Portfolio up to $30 million, 2.0% of the next $70 million and 1.5% of the average daily net assets of such Portfolio in excess of $100 million Morgan Stanley Special Growth Fund Morgan Stanley Special Value Fund Morgan Stanley Strategist Fund Morgan Stanley Tax-Exempt Securities Trust Morgan Stanley Tax-Free Daily Income Trust Morgan Stanley Technology Fund Morgan Stanley U.S. Government Securities Trust Morgan Stanley Variable Investment Series: Capital Opportunities Portfolio, Dividend Growth Portfolio, Global Infrastructure Portfolio, High Yield Portfolio, Income Plus Portfolio, Money Market Portfolio or Strategist Portfolio. 1.5% of the average daily net assets of such Portfolio up to $30 million and 1.0% of the average daily net assets of such Portfolio in excess of $30 million European Equity Portfolio or Global Dividend Growth Portfolio: 2.5% of the average daily net assets of such Portfolio up to $30 million, 2.0% of the next $70 million and 1.5% of the average daily net assets of such Portfolio in excess of $100 million A-3-2 EX-99.77Q1 OTHR EXHB 8 bylaws.txt BY LAWS BY-LAWS OF MORGAN STANLEY INSURED MUNICIPAL BOND TRUST AMENDED AND RESTATED AS OF JUNE 19, 2009 ARTICLE I DEFINITIONS The terms "Commission," "Declaration," "Distributor," "Investment Adviser," "Majority Shareholder Vote," "1940 Act," "Shareholder," "Shares," "Transfer Agent," "Trust," "Trust Property," and "Trustees" have the respective meanings given them in the Declaration of Trust of Morgan Stanley Insured Municipal Bond Trust dated February 27, 1990, as amended from time to time. ARTICLE II OFFICES Section 2.1. Principal Office. Until changed by the Trustees, the principal office of the Trust in the Commonwealth of Massachusetts shall be in the City of Boston, County of Suffolk. Section 2.2. Other Offices. In addition to its principal office in the Commonwealth of Massachusetts, the Trust may have an office or offices in the City of New York, State of New York, and at such other places within and without the Commonwealth as the Trustees may from time to time designate or the business of the Trust may require. ARTICLE III SHAREHOLDERS' MEETINGS Section 3.1. Place of Meetings. Meetings of Shareholders shall be held at such place, within or without the Commonwealth of Massachusetts, as may be designated from time to time by the Trustees and stated in the notice of such meeting. Section 3.2. Annual Meetings. An annual meeting of Shareholders, at which the Shareholders shall elect Trustees and transact such other business as may properly come before the meeting, shall be held on such day of each calendar year as shall be designated by the Board of Trustees and at the time stated in the notice of meeting. Section 3.3. Special Meetings. Special meetings of Shareholders of the Trust shall be held whenever called by the Chairman, a majority of the Board of Trustees or the President of the Trust. Special meetings of Shareholders shall also be called by the Secretary: (i) with respect to matters not requiring voting by the Common Shareholders and the Preferred Shareholders voting as separate classes, upon the written request of the holders of Shares entitled to vote not less than a majority of all the votes entitled to be cast at such meeting; (ii) with respect to matters requiring voting by the Common Shareholders and the Preferred Shareholders voting as separate classes, upon the written request of not less than a majority of the outstanding Common Shares and not less than the percentage of the Preferred Shares as set forth in the designation pursuant to Section 6.1 of the Declaration of Trust each voting as separate classes; or (iii) in the case of a meeting for the purpose of voting on the removal of any Trustee or Trustees, upon written request of the class of Shareholders entitled to vote on the removal of such Trustee or Trustees holding in the aggregate not less than 10% of the outstanding shares of such class. Any written request for a special meeting shall state the purpose or purposes of such meeting and the matters proposed to be acted on thereat. The Secretary shall inform such Shareholders of the reasonable estimated cost of preparing and mailing such notice of the meeting, and, upon payment to the Trust of such costs, the Secretary shall give notice stating the purpose or purposes of the meeting to all Shareholders entitled to vote at such meeting and each other Shareholder entitled to notice of the meeting. No special meeting need be called upon the request of the holders of Shares entitled to cast less than a majority of all votes entitled to be cast at such meeting, to consider any matter which is substantially the same as a matter voted upon at any special meeting of Shareholders held during the preceding twelve months. Section 3.4. Notice of Meetings. Written or printed notice of every Shareholders' meeting stating the place, date, and purpose or purposes thereof, shall be given by the Secretary not less than ten (10) nor more than ninety (90) days before such meeting to each Shareholder entitled to vote at such meeting, and each other Shareholder entitled to notice of the meeting. Such notice shall be deemed to be given when deposited in the United States mail, postage prepaid, directed to the Shareholder at his address as it appears on the records of the Trust. Section 3.5. Quorum and Adjournment of Meetings. Except as otherwise provided by law, by the Declaration or by these By-Laws, at all meetings of Shareholders, the holders of a majority of the Shares issued and outstanding and entitled to vote thereat, present in person or represented by proxy, shall be requisite and shall constitute a quorum for the transaction of business. In the absence of a quorum, the chairman of the meeting or the Shareholders present or represented by proxy and entitled to vote thereat shall have the power to adjourn the meeting from time to time. The Shareholders present in person or represented by proxy at any meeting and entitled to vote thereat also shall have the power to adjourn the meeting from time to time if the vote required to approve or reject any proposal described in the original notice of such meeting is not obtained (with proxies being voted for or against adjournment consistent with the votes for and against the proposal for which the required vote has not been obtained). The affirmative vote of the holders of a majority of the Shares then present in person or represented by proxy shall be required to adjourn any meeting. Any adjourned meeting may be reconvened without further notice or change in record date. At any reconvened meeting at which a quorum shall be present, any business may be transacted that might have been transacted at the meeting as originally called. Section 3.6. Voting Rights, Proxies. At each meeting of Shareholders, each holder of record of Shares entitled to vote thereat shall be entitled to one vote in person or by proxy for each Share of beneficial interest of the Trust and for the fractional portion of one vote for each fractional Share entitled to vote so registered in his or her name on the records of the Trust on the date fixed as the record date for the determination of Shareholders entitled to vote at such meeting. Without limiting the manner in which a Shareholder may authorize another person or persons to act for such Shareholder as proxy pursuant hereto, the following shall constitute a valid means by which a Shareholder may grant such authority: (i) A Shareholder may execute a writing authorizing another person or persons to act for such Shareholder as proxy. Execution may be accomplished by the Shareholder or such Shareholder's authorized officer, director, employee, attorney-in-fact or another agent signing such writing or causing such person's signature to be affixed to such writing by any reasonable means including, but not limited to, by facsimile or telecopy signature. No written evidence of authority of a Shareholder's authorized officer, director, employee, attorney-in-fact or other agent shall be required; and -2- (ii) A Shareholder may authorize another person or persons to act for such Shareholder as proxy by transmitting or authorizing the transmission of a telegram or cablegram or by other means of telephonic, electronic or computer transmission to the person who will be the holder of the proxy or to a proxy solicitation firm, proxy support service organization or like agent duly authorized by the person who will be the holder of the proxy to receive such transmission, provided that any such telegram or cablegram or other means of telephonic, electronic or computer transmission must either set forth or be submitted with information from which it can be determined that the telegram, cablegram or other transmission was authorized by the Shareholder. No proxy shall be valid after eleven months from its date, unless otherwise provided in the proxy. At all meetings of Shareholders, unless the voting is conducted by inspectors, all questions relating to the qualification of voters and the validity of proxies and the acceptance or rejection of votes shall be decided by the chairman of the meeting. In determining whether a telegram, cablegram or other electronic transmission is valid, the chairman or inspector, as the case may be, shall specify the information upon which he or she relied. Pursuant to a resolution of a majority of the Trustees, proxies may be solicited in the name of one or more Trustees or Officers of the Trust. Proxy solicitations may be made in writing or by using telephonic or other electronic solicitation procedures that include appropriate methods of verifying the identity of the Shareholder and confirming any instructions given thereby. Section 3.7. Vote Required. Except as otherwise provided by law, by the Declaration of Trust, these By-Laws or resolution of the Trustees specifying a greater or lesser vote required for the transaction of any item of business at any meeting of Shareholders, at each meeting of Shareholders at which a quorum is present, all matters shall be decided by the vote of a majority of the Shares present in person or represented by proxy and entitled to vote, provided, however, that with respect to any matter required to be voted on separately by class of Shares the matter shall be decided by the vote of a majority of the Shares so present or represented and entitled to vote on the subject matter. Section 3.8. Inspectors of Election. In advance of any meeting of Shareholders, the Trustees may appoint Inspectors of Election to act at the meeting or any adjournment thereof. If Inspectors of Election are not so appointed, the chairman of any meeting of Shareholders may, and on the request of any Shareholder or his proxy shall, appoint Inspectors of Election of the meeting. In case any person appointed as Inspector fails to appear or fails or refuses to act, the vacancy may be filled by appointment made by the Trustees in advance of the convening of the meeting or at the meeting by the person acting as chairman. The Inspectors of Election shall determine the number of Shares outstanding, the Shares represented at the meeting, the existence of a quorum, the authenticity, validity and effect of proxies, shall receive votes, ballots or consents, shall hear and determine all challenges and questions in any way arising in connection with the right to vote, shall count and tabulate all votes or consents, determine the results, and do such other acts as may be proper to conduct the election or vote with fairness to all Shareholders. On request of the chairman of the meeting, or of any Shareholder or his proxy, the Inspectors of Election shall make a report in writing of any challenge or question or matter determined by them and shall execute a certificate of any facts found by them. Section 3.9. Inspection of Books and Records. Shareholders shall have such rights and procedures of inspection of the books and records of the Trust as are granted to Shareholders under Section 32 of the Business Corporation Law of the Commonwealth of Massachusetts. Section 3.10. Action by Shareholders Without Meeting. Except as otherwise provided by law, the provisions of these By-Laws relating to notices and meetings to the contrary notwithstanding, any action required or permitted to be taken at any meeting of Shareholders may be taken without a meeting if a majority of the Shareholders entitled to vote upon the action consent to the action in writing and such -3- consents are filed with the records of the Trust. Such consent shall be treated for all purposes as a vote taken at a meeting of Shareholders. Section 3.11. Presence at Meetings. Presence at meetings of shareholders requires physical attendance by the shareholder or his or her proxy at the meeting site and does not encompass attendance by telephonic or other electronic means. Section 3.12. Conduct of Shareholders' Meetings. The meetings of the Shareholders shall be presided over by the Chairman, or if he is not present, by the President, or if he is not present, by a Vice-President, or if none of them is present, by a chairman to be elected at the meeting. The Secretary of the Trust, if present, shall act as a Secretary of such meeting, or if he is not present, an Assistant Secretary shall so act; if neither the Secretary nor the Assistant Secretary is present, a Secretary shall be elected at the meeting. The order of business and all other matters of procedure at any meeting of Shareholders shall be determined by the chairman of the meeting. The chairman of the meeting may prescribe such rules, regulations and procedures and take such action as, in the discretion of such chairman, are appropriate for the proper conduct of the meeting, including, without limitation, (a) restricting admission to the time set for the commencement of the meeting; (b) limiting attendance at the meeting to Shareholders of record of the Trust, their duly authorized proxies and other such individuals as the chairman of the meeting may determine; (c) limiting participation at the meeting on any matter to Shareholders of record of the Trust entitled to vote on such matter, their duly authorized proxies and other such individuals as the chairman of the meeting may determine; (d) limiting the time allotted to questions or comments by participants; (e) maintaining order and security at the meeting; (f) removing any Shareholder or any other individual who refuses to comply with meeting procedures, rules or guidelines as set forth by the chairman of the meeting; and (g) recessing or adjourning the meeting to a later date and time and place announced at the meeting. Unless otherwise determined by the chairman of the meeting, meetings of Shareholders shall not be required to be held in accordance with the rules of parliamentary procedure. Section 3.13. Advance Notice of Shareholder Nominees for Trustee and Other Shareholder Proposals. (a) The matters to be considered and brought before any annual or special meeting of Shareholders of the Trust shall be limited to only such matters, including the nomination and election of Trustees, as shall be brought properly before such meeting in compliance with the procedures set forth in this Section 3.13. (b) For any matter to be properly before any annual meeting of Shareholders, the matter must be (i) specified in the notice of annual meeting given by or at the direction of the Board of Trustees; (ii) otherwise brought before the annual meeting by or at the direction of the Board of Trustees; or (iii) brought before the annual meeting in the manner specified in this Section 3.13 by a Shareholder of record both at the time of the giving of notice provided for in this Section 3.13 and at the time of the meeting, or a Shareholder (a "Nominee Holder") that holds voting securities entitled to vote at meetings of Shareholders through a nominee or "street name" holder of record and can demonstrate to the Trust such indirect ownership and such Nominee Holder's entitlement to vote such securities, and is a Nominee Holder at both the time of the giving of notice provided for in this Section 3.13 and at the time of the meeting. In addition to any other requirements under applicable law and the Declaration and By-Laws of the Trust, persons nominated by Shareholders for election as Trustees of the Trust and any other proposals by Shareholders shall be properly brought before the meeting only if notice of any such matter to be presented by a Shareholder at such meeting of Shareholders (the "Shareholder Notice") shall be delivered to the Secretary of the Trust at the principal executive office of the Trust not less than sixty (60) nor more than ninety (90) days prior to the first anniversary date of the annual meeting for the preceding -4- year; provided, however, that, if and only if the annual meeting is not scheduled to be held within a period that commences thirty (30) days before such anniversary date and ends thirty (30) days after such anniversary date (an annual meeting date outside such period being referred to herein as an "Other Annual Meeting Date"), such Shareholder Notice shall be given in the manner provided herein by the later of the close of business on (i) the date sixty (60) days prior to such Other Annual Meeting Date or (ii) the tenth (10th) day following the date such Other Annual Meeting Date is first publicly announced or disclosed. Any Shareholder desiring to nominate any person or persons (as the case may be) for election as a Trustee or Trustees of the Trust shall deliver, as part of such Shareholder Notice: (i) a statement in writing setting forth (A) the name of the person or persons to be nominated, (B) the number and class of all shares of each class of Shares of the Trust owned of record and beneficially by each such person, as reported to such Shareholder by such nominee(s), (C) the information regarding each such person required by paragraph (b) of Item 22 of Rule 14a-101 under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), adopted by the Securities and Exchange Commission (or the corresponding provisions of any regulation or rule subsequently adopted by the Securities and Exchange Commission applicable to the Trust), (D) whether such Shareholder believes any nominee will be an "interested person" of the Trust (as defined in the 1940 Act), and, if not an "interested person", information regarding each nominee that will be sufficient for the Trust to make such determination, and (E) the number and class of all Shares of each class of Shares of the Trust owned of record and beneficially by such Shareholder; (ii) each such person's signed consent to serve as a Trustee of the Trust if elected, such Shareholder's name and address; and (iii) in the case of a Nominee Holder, evidence establishing such Nominee Holder's indirect ownership of, and entitlement to vote, securities at the meeting of Shareholders. Any Shareholder who gives a Shareholder Notice of any matter proposed to be brought before the meeting (not involving nominees for Trustee) shall deliver, as part of such Shareholder Notice, the text of the proposal to be presented and a brief written statement of the reasons why such Shareholder favors the proposal and setting forth such Shareholder's name and address, the number and class of all Shares of each class of Shares of the Trust owned of record and beneficially by such Shareholder, if applicable, any material interest of such Shareholder in the matter proposed (other than as a Shareholder) and, in the case of a Nominee Holder, evidence establishing such Nominee Holder's indirect ownership of, and entitlement to vote, securities at the meeting of Shareholders. As used herein, shares "beneficially owned" shall mean all Shares which such person is deemed to beneficially own pursuant to Rules 13d-3 and 13d-5 under the Exchange Act. Notwithstanding anything in this Section 3.13 to the contrary, in the event that the number of Trustees to be elected to the Board of Trustees of the Trust is increased and either all of the nominees for Trustee or the size of the increased Board of Trustees are not publicly announced or disclosed by the Trust at least seventy (70) days prior to the first anniversary of the preceding year's annual meeting, a Shareholder Notice shall also be considered timely hereunder, but only with respect to nominees for any new positions created by such increase, if it shall be delivered to the Secretary of the Trust at the principal executive office of the Trust not later than the close of business on the tenth (10th) day following the first date all of such nominees or the size of the increased Board of Trustees shall have been publicly announced or disclosed. (c) Only such matters shall be conducted at a special meeting of Shareholders as shall have been brought before the meeting pursuant to the Trust's notice of meeting. Nominations of individuals for election to the Board of Trustees may be made at a special meeting of Shareholders at which Trustees are to be elected (i) pursuant to the Trust's notice of meeting, (ii) by or at the direction of the Board of Trustees or (iii) provided that the Board of Trustees has determined that Trustees shall be elected at such special meeting, by any Shareholder of the Trust who is a Shareholder of record both at the time of giving of notice provided for in this Section 3.13 and at the time of the special meeting, who is entitled to vote at the meeting and who complied with the notice procedures set forth in this Section 3.13, or a Nominee Holder that holds voting securities entitled to vote at meetings of Shareholders through a nominee or -5- "street name" holder of record and can demonstrate to the Trust such indirect ownership and such Nominee Holder's entitlement to vote such securities, and is a Nominee Holder both at the time of giving of notice provided for in this Section 3.13 and at the time of the Special Meeting, and who is entitled to vote at the meeting and has complied with the notice procedures set forth in this Section 3.13. In the event the Trust calls a special meeting of Shareholders for the purpose of electing one or more Trustees to the Board of Trustees, any Shareholder may nominate a person or persons (as the case may be), for election to such position(s) as specified in the Trust's notice of meeting, if the Shareholder Notice required by clause (b) of this Section 3.13 hereof shall be delivered to the Secretary of the Trust at the principal executive office of the Trust not later than the close of business on the tenth (10th) day following the day on which the date of the special meeting and of the nominees proposed by the Board of Trustees to be elected at such meeting is publicly announced or disclosed. (d) For purposes of this Section 3.13, a matter shall be deemed to have been "publicly announced or disclosed" if such matter is disclosed in a press release reported by the Dow Jones News Service, Associated Press or comparable national news service or in a document publicly filed by the Trust with the Securities and Exchange Commission. (e) In no event shall the adjournment of an annual or special meeting, or any announcement thereof, commence a new period for the giving of notice as provided in this Section 3.13. This Section 3.13 shall not apply to Shareholder proposals made pursuant to Rule 14a-8 under the Exchange Act. (f) The person presiding at any meeting of Shareholders, in addition to making any other determinations that may be appropriate to the conduct of the meeting, shall have the power and duty to determine whether notice of nominees and other matters proposed to be brought before a meeting has been duly given in the manner provided in this Section 3.13 and, if not so given, shall direct and declare at the meeting that such nominees and other matters shall not be considered. ARTICLE IV TRUSTEES Section 4.1. Meetings of the Trustees. The Trustees may in their discretion provide for regular or special meetings of the Trustees. Regular meetings of the Trustees may be held at such time and place as shall be determined from time to time by the Trustees without further notice. Special meetings of the Trustees may be called at any time by the President and shall be called by the President or the Secretary upon the written request of any two (2) Trustees. Section 4.2. Notice of Special Meetings. Notice of special meetings of the Trustees, stating the place, date and time thereof, shall be given not less than two (2) days before such meeting to each Trustee, personally, by telegram, by mail, by electronic transmission, by telephone or by leaving such notice at his place of residence or usual place of business. If mailed, such notice shall be deemed to be given when deposited in the United States mail, postage prepaid, directed to the Trustee at his address as it appears on the records of the Trust. Subject to the provisions of the 1940 Act, notice or waiver of notice need not specify the purpose of any special meeting. Section 4.3. Telephone Meetings. Subject to the provisions of the 1940 Act, any Trustee, or any member or members of any committee designated by the Trustees, may participate in a meeting of the Trustees, or any such committee, as the case may be, 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. Participation in a meeting by these means constitutes presence in person at the meeting. -6- Section 4.4. Quorum, Voting and Adjournment of Meetings. At all meetings of the Trustees, one-third of the Trustees then in office shall be requisite to and shall constitute a quorum for the transaction of business. If a quorum is present, the affirmative vote of a majority of the Trustees present shall be the act of the Trustees, unless the concurrence of a greater proportion is expressly required for such action by law, the Declaration or these By-Laws. If at any meeting of the Trustees there be less than a quorum present, the Trustees present thereat may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall have been obtained. Section 4.5. Action by Trustees Without Meeting. The provisions of these By-Laws covering notices and meetings to the contrary notwithstanding, and except as required by law, any action required or permitted to be taken at any meeting of the Trustees may be taken without a meeting if a unanimous consent setting forth the action is given in writing or by electronic transmission by each Trustee and such consent is filed with the minutes of proceedings of the Trustees. Section 4.6. Expenses and Fees. Each Trustee may be allowed expenses, if any, for attendance at each regular or special meeting of the Trustees, and each Trustee who is not an officer or employee of the Trust or of its investment manager or underwriter or of any corporate affiliate of any of said persons shall receive for services rendered as a Trustee of the Trust such compensation as may be fixed by the Trustees. Nothing herein contained shall be construed to preclude any Trustee from serving the Trust in any other capacity and receiving compensation therefor. Section 4.7. Execution of Instruments and Documents and Signing of Checks and Other Obligations and Transfers. All instruments, documents and other papers shall be executed in the name and on behalf of the Trust and all checks, notes, drafts and other obligations for the payment of money by the Trust shall be signed, and all transfer of securities standing in the name of the Trust shall be executed, by the Chairman, the President, any Vice President or the Treasurer or by any one or more officers or agents of the Trust as shall be designated for that purpose by vote of the Trustees; notwithstanding the above, nothing in this Section 4.7 shall be deemed to preclude the electronic authorization, by designated persons, of the Trust's Custodian (as described herein in Section 9.1) to transfer assets of the Trust, as provided for herein in Section 9.1. Section 4.8. Indemnification of Trustees, Officers, Employees and Agents. (a) The Trust shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending, or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Trust) by reason of the fact that he is or was a Trustee, officer, employee, or agent of the Trust. The indemnification shall be against expenses, including attorneys' fees, judgments, fines, and amounts paid in settlement, actually and reasonably incurred by him in connection with the action, suit, or proceeding, if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Trust, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the Trust, and, with respect to any criminal action or proceeding, had reasonable cause to believe that his conduct was unlawful. (b) The Trust shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or on behalf of the Trust to obtain a judgment or decree in its favor by reason of the fact that he is or was a Trustee, officer, employee, or agent of the Trust. The indemnification shall be against expenses, including attorneys' fees actually and reasonably incurred by him in connection with the defense or settlement of the action or suit, if he acted -7- in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Trust; except that no indemnification shall be made in respect of any claim, issue, or matter as to which the person has been adjudged to be liable for negligence or misconduct in the performance of his duty to the Trust, except to the extent that the court in which the action or suit was brought, or a court of equity in the county in which the Trust has its principal office, determines upon application that, despite the adjudication of liability but in view of all circumstances of the case, the person is fairly and reasonably entitled to indemnity for those expenses which the court shall deem proper, provided such Trustee, officer, employee or agent is not adjudged to be liable by reason of his willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of his office. (c) To the extent that a Trustee, officer, employee, or agent of the Trust has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in subsection (a) or (b) or in defense of any claim, issue or matter therein, he shall be indemnified against expenses, including attorneys' fees, actually and reasonably incurred by him in connection therewith. (d) (1) Unless a court orders otherwise, any indemnification under subsections (a) or (b) of this section may be made by the Trust only as authorized in the specific case after a determination that indemnification of the Trustee, officer, employee, or agent is proper in the circumstances because he has met the applicable standard of conduct set forth in subsections (a) or (b). (2) The determination shall be made: (i) By the Trustees, by a majority vote of a quorum which consists of Trustees who were not parties to the action, suit or proceeding; or (ii) If the required quorum is not obtainable, or if a quorum of disinterested Trustees so directs, by independent legal counsel in a written opinion; or (iii) By the Shareholders. (3) Notwithstanding any provision of this Section 4.8, no person shall be entitled to indemnification for any liability, whether or not there is an adjudication of liability, arising by reason of willful misfeasance, bad faith, gross negligence, or reckless disregard of duties as described in Section 17(h) and (i) of the Investment Company Act of 1940 ("disabling conduct"). A person shall be deemed not liable by reason of disabling conduct if, either: (i) a final decision on the merits is made by a court or other body before whom the proceeding was brought that the person to be indemnified ("indemnitee") 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 indemnitee was not liable by reason of disabling conduct, is made by either: (A) a majority of a quorum of Trustees who are neither "interested persons" of the Trust, as defined in Section 2(a)(19) of the Investment Company Act of 1940, nor parties to the action, suit or proceeding, or (B) an independent legal counsel in a written opinion. -8- (e) Expenses, including attorneys' fees, incurred by a Trustee, officer, employee or agent of the Trust in defending a civil or criminal action, suit or proceeding may be paid by the Trust in advance of the final disposition thereof if: (1) authorized in the specific case by the Trustees; and (2) the Trust receives an undertaking by or on behalf of the Trustee, officer, employee or agent of the Trust to repay the advance if it is not ultimately determined that such person is entitled to be indemnified by the Trust; and (3) either, (i) such person provides a security for his undertaking, or (ii) the Trust is insured against losses by reason of any lawful advances, or (iii) a determination, based on a review of readily available facts, that there is reason to believe that such person ultimately will be found entitled to indemnification, is made by either: (A) a majority of a quorum which consists of Trustees who are neither "interested persons" of the Trust, as defined in Section 2(a)(19) of the 1940 Act, nor parties to the action, suit or proceeding, or (B) an independent legal counsel in a written opinion. (f) The indemnification provided by this Section shall not be deemed exclusive of any other rights to which a person may be entitled under any by-law, agreement, vote of Shareholders or disinterested Trustees or otherwise, both as to action in his official capacity and as to action in another capacity while holding the office, and shall continue as to a person who has ceased to be a Trustee, officer, employee, or agent and inure to the benefit of the heirs, executors and administrators of such person; provided that no person may satisfy any right of indemnity or reimbursement granted herein or to which he may be otherwise entitled except out of the property of the Trust, and no Shareholder shall be personally liable with respect to any claim for indemnity or reimbursement or otherwise. (g) The Trust may purchase and maintain insurance on behalf of any person who is or was a Trustee, officer, employee, or agent of the Trust, against any liability asserted against him and incurred by him in any such capacity, or arising out of his status as such. However, in no event will the Trust purchase insurance to indemnify any officer or Trustee against liability for any act for which the Trust itself is not permitted to indemnify him. (h) Nothing contained in this Section shall be construed to protect any Trustee or officer of the Trust against any liability to the Trust or to its security holders 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. Section 4.9. Selection and Nomination of Non-Interested Trustees. Subject to approval by a majority of the Trustees of the Trust, the Trustees of the Trust who are not interested persons of the Trust (as that term is defined in the 1940 Act) shall select and nominate the Trustees of the Trust who are not interested persons of the Trust. -9- ARTICLE V COMMITTEES Section 5.1. Executive and Other Committees. The Trustees, by resolution adopted by a majority of the Trustees, may designate an Executive Committee and/or committees, each committee to consist of one (1) or more of the Trustees of the Trust and may delegate to such committees, in the intervals between meetings of the Trustees, any or all of the powers of the Trustees in the management of the business and affairs of the Trust. In the absence of any member of any such committee, the members thereof present at any meeting, whether or not they constitute a quorum, may appoint a Trustee to act in place of such absent member. Each such committee shall keep a record of its proceedings. The Executive Committee and any other committee shall fix its own rules or procedure, but the presence of at least fifty percent (50%) of the members of the whole committee shall in each case be necessary to constitute a quorum of the committee and the affirmative vote of the majority of the members of the committee present at the meeting shall be necessary to take action. All actions of the Executive Committee shall be reported to the Trustees at the meeting thereof next succeeding to the taking of such action. Section 5.2. Advisory Committee. The Trustees may appoint an advisory committee which shall be composed of persons who do not serve the Trust in any other capacity and which shall have advisory functions with respect to the investments of the Trust but which shall have no power to determine that any security or other investment shall be purchased, sold or otherwise disposed of by the Trust. The number of persons constituting any such advisory committee shall be determined from time to time by the Trustees. The members of any such advisory committee may receive compensation for their services and may be allowed such fees and expenses for the attendance at meetings as the Trustees may from time to time determine to be appropriate. Section 5.3. Committee Action Without Meeting. The provisions of these By-Laws covering notices and meetings to the contrary notwithstanding, and except as required by law, any action required or permitted to be taken at any meeting of any Committee of the Trustees appointed pursuant to Section 5.1 of these By-Laws may be taken without a meeting if a unanimous consent setting forth the action is given in writing or by electronic transmission by each member of the Committee and such consent is filed with the records of the proceedings of the Committee. ARTICLE VI OFFICERS Section 6.1. Executive Officers. The executive officers of the Trust shall be a Chairman, a Principal Executive Officer, a President, a Chief Financial Officer, one or more Vice Presidents, a Secretary and a Treasurer. The Chairman shall be selected from among the Trustees but none of the other executive officers need be a Trustee. Two or more offices, except those of President and any Vice President, may be held by the same person, but no officer shall execute, acknowledge or verify any instrument in more than one capacity. The executive officers, and other officers, of the Trust shall be elected annually by the Trustees and each executive officer so elected shall hold office until his or her successor is elected and has qualified. Section 6.2. Other Officers and Agents. The Trustees may also elect one or more Assistant Vice Presidents, Assistant Secretaries and Assistant Treasurers and may elect, or may delegate to the -10- Chairman the power to appoint, such other officers and agents as the Trustees shall at any time or from time to time deem advisable. Section 6.3. Term and Removal and Vacancies. Each officer of the Trust shall hold office for a term of one year or until his or her successor is elected and has qualified. Any officer or agent of the Trust may be removed by the Trustees whenever, in their judgment, the best interests of the Trust will be served thereby, but such removal shall be without prejudice to the contractual rights, if any, of the person so removed. Section 6.4. Compensation of Officers. The compensation of officers and agents of the Trust shall be fixed by the Trustees, or by the Chairman to the extent provided by the Trustees with respect to officers appointed by the Chairman. Section 6.5. Powers and Duties. All officers and agents of the Trust, as between themselves and the Trust, shall have such authority and perform such duties in the management of the Trust as may be provided in or pursuant to these By-Laws or, to the extent not so provided, as may be prescribed by the Trustees; provided that no rights of any third party shall be affected or impaired by any such By-Law or resolution of the Trustees unless such third party has knowledge thereof. Section 6.6. The Chairman. The Chairman shall preside at all meetings of the Shareholders and of the Trustees and shall perform such other duties as the Trustees may from time to time prescribe. Section 6.7. The President. The President shall have general and active management of the business of the Trust. He or she shall see that all orders and resolutions of the Board of Trustees are carried into effect. He or she shall have such other duties as may be prescribed from time to time by the Board of Trustees. The President shall be authorized to delegate to one or more Vice Presidents such of his or her powers and duties at such times and in such manner as he or she may deem advisable. Section 6.8. The Principal Executive Officer. The Principal Executive Officer shall be considered the principal executive officer of the Trust for purposes of Section 6 of the Securities Act of 1933, as amended, and shall have the responsibility conferred upon the principal executive officer of an issuer under the Sarbanes-Oxley Act of 2002. Section 6.9. The Vice Presidents. The Vice Presidents shall be of such number and shall have such titles as may be determined from time to time by the Trustees. The Vice President, or, if there shall be more than one, the Vice Presidents in such order as may be determined from time to time by the Trustees or the Chairman, shall, in the absence or disability of the President, exercise the powers and perform the duties of the President, and shall perform such other duties as the Trustees or the Chairman may from time to time prescribe. Section 6.10. The Assistant Vice Presidents. The Assistant Vice President, or, if there shall be more than one, the Assistant Vice Presidents in such order as may be determined from time to time by the Trustees or the Chairman, shall perform such duties and have such powers as may be assigned them from time to time by the Trustees or the Chairman. Section 6.11. The Secretary. The Secretary shall attend all meetings of the Trustees and all meetings of the Shareholders and record all the proceedings of the meetings of the Shareholders and of the Trustees in a book to be kept for that purpose, and shall perform like duties for the standing committees when required. He or she shall give, or cause to be given, notice of all meetings of the Shareholders and special meetings of the Trustees, and shall perform such other duties and have such powers as the Trustees or the Chairman may from time to time prescribe. He or she shall keep in safe -11- custody the seal of the Trust and affix or cause the same to be affixed to any instrument requiring it, and, when so affixed, it shall be attested by his or her signature or by the signature of an Assistant Secretary. Section 6.12. The Assistant Secretaries. The Assistant Secretary, or, if there shall be more than one, the Assistant Secretaries in such order as may be determined from time to time by the Trustees or the Chairman, shall, in the absence or disability of the Secretary, perform the duties and exercise the powers of the Secretary and shall perform such duties and have such other powers as the Trustees or the Chairman may from time to time prescribe. Section 6.13. The Treasurer. The Treasurer shall perform such duties as the Board of Trustees or the President may from time to time prescribe. Section 6.14. The Assistant Treasurers. The Assistant Treasurer, or, if there shall be more than one, the Assistant Treasurers in such order as may be determined from time to time by the Trustees or the Chairman, shall, in the absence or disability of the Treasurer, perform the duties and exercise the powers of the Treasurer and shall perform such other duties and have such other powers as the Trustees or the Chairman may from time to time prescribe. Section 6.15. The Chief Financial Officer. The Chief Financial Officer shall keep or cause to be kept full and accurate accounts of receipts and disbursements in books belonging to the Trust, and he or she shall render to the Trustees and the President, whenever any of them require it, an account of his or her transactions as Chief Financial Officer and of the financial condition of the Trust, and he or she shall perform such other duties as the Trustees or the President may from time to time prescribe. He or she shall be considered the principal financial officer of the Trust for purposes of Section 6 of the Securities Act of 1933, as amended, and shall have the responsibility conferred upon the principal financial officer of an issuer under the Sarbanes-Oxley Act of 2002. Section 6.16. Delegation of Duties. Whenever an officer is absent or disabled, or whenever for any reason the Trustees may deem it desirable, the Trustees may delegate the powers and duties of an officer or officers to any other officer or officers or to any Trustee or Trustees. ARTICLE VII DIVIDENDS AND DISTRIBUTIONS Subject to any applicable provisions of law and the Declaration, dividends and distributions upon the Shares may be declared at such intervals as the Trustees may determine, in cash, in securities or other property, or in Shares, from any sources permitted by law, all as the Trustees shall from time to time determine. Inasmuch as the computation of net income and net profits from the sales of securities or other properties for federal income tax purposes may vary from the computation thereof on the records of the Trust, the Trustees shall have power, in their discretion, to distribute as income dividends and as capital gain distributions, respectively, amounts sufficient to enable the Trust to avoid or reduce liability for federal income taxes. -12- ARTICLE VIII CERTIFICATES OF SHARES Section 8.1. Certificates of Shares. Subject to the authority of the Board of Trustees to cause some or all of the Shares of any series or class of Shares to be issued without certificates, each Shareholder of the Trust shall be entitled to a certificate or certificates for the full number of Shares of the Trust owned by him. Certificates for Shares of each series or class of Shares shall be in such form and of such design as the Trustees shall approve, subject to the right of the Trustees to change such form and design at any time or from time to time, and shall be entered in the records of the Trust as they are issued. Each such certificate shall bear a distinguishing number; shall exhibit the holders' name and certify the number of full Shares owned by such holder; shall be signed by or in the name of the Trust by the President, or a Vice President, and countersigned by the Secretary or an Assistant Secretary or the Treasurer and an Assistant Treasurer of the Trust; and shall contain such recitals as may be required by law. Where any certificate is signed by a Transfer Agent or by a Registrar, the signature of such officers may be facsimile, printed or engraved. The Trust may, at its option, determine not to issue a certificate or certificates to evidence Shares owned of record by any Shareholder. In case any officer or officers who shall have signed, or whose facsimile signature or signatures shall appear on, any such certificate or certificates shall cease to be such officer or officers of the Trust, whether because of death, resignation or otherwise, before such certificate or certificates shall have been delivered by the Trust, such certificate or certificates shall, nevertheless, be adopted by the Trust and be issued and delivered as though the person or persons who signed such certificate or certificates or whose facsimile signature or signatures shall appear therein had not ceased to be such officer or officers of the Trust. No certificate shall be issued for any share until such share is fully paid. Section 8.2. Lost, Stolen, Destroyed and Mutilated Certificates. The Trustees may direct a new certificate or certificates to be issued in place of any certificate or certificates theretofore issued by the Trust alleged to have been lost, stolen or destroyed, upon satisfactory proof of such loss, theft, or destruction; and the Trustees may, in their discretion, require the owner of the lost, stolen or destroyed certificate, or his legal representative, to give to the Trust and to such Registrar, Transfer Agent and/or Transfer Clerk as may be authorized or required to countersign such new certificate or certificates, a bond in such sum and of such type as they may direct, and with such surety or sureties, as they may direct, as indemnity against any claim that may be against them or any of them on account of or in connection with the alleged loss, theft or destruction of any such certificate. ARTICLE IX CUSTODIAN Section 9.1. Appointment and Duties. The Trust shall at times employ a bank or trust company having capital, surplus and undivided profits of at least five million dollars ($5,000,000) as custodian with authority as its agent, but subject to such restrictions, limitations and other requirements, if any, as may be contained in these By-Laws and the 1940 Act: (1) to receive and hold the securities owned by the Trust and deliver the same upon written or electronically transmitted order; -13- (2) to receive and receipt for any moneys due to the Trust and deposit the same in its own banking department or elsewhere as the Trustees may direct; (3) to disburse such funds upon orders or vouchers; all upon such basis of compensation as may be agreed upon between the Trustees and the custodian. If so directed by a Majority Shareholder Vote, the custodian shall deliver and pay over all property of the Trust held by it as specified in such vote. The Trustees may also authorize the custodian to employ one or more sub-custodians from time to time to perform such of the acts and services of the custodian and upon such terms and conditions as may be agreed upon between the custodian and such sub-custodian and approved by the Trustees. Section 9.2. Central Certificate System. Subject to such rules, regulations and orders as the Commission may adopt, the Trustees may direct the custodian to deposit all or any part of the securities owned by the Trust in a system for the central handling of securities established by a national securities exchange or a national securities association registered with the Commission under the Securities Exchange Act of 1934, or such other person as may be permitted by the Commission, or otherwise in accordance with the 1940 Act, pursuant to which system all securities of any particular class or series of any issuer deposited within the system are treated as fungible and may be transferred or pledged by bookkeeping entry without physical delivery of such securities, provided that all such deposits shall be subject to withdrawal only upon the order of the Trust. ARTICLE X WAIVER OF NOTICE Whenever any notice of the time, place or purpose of any meeting of Shareholders, Trustees, or of any committee is required to be given in accordance with law or under the provisions of the Declaration or these By-Laws, a waiver thereof in writing, signed by the person or persons entitled to such notice and filed with the records of the meeting, whether before or after the holding thereof, or actual attendance at the meeting of shareholders, Trustees or committee, as the case may be, in person, shall be deemed equivalent to the giving of such notice to such person. ARTICLE XI MISCELLANEOUS Section 11.1. Location of Books and Records. The books and records of the Trust may be kept outside the Commonwealth of Massachusetts at such place or places as the Trustees may from time to time determine, except as otherwise required by law. Section 11.2. Record Date. The Trustees may fix in advance a date as the record date for the purpose of determining the Shareholders entitled to (i) receive notice of, or to vote at, any meeting of Shareholders, or (ii) receive payment of any dividend or the allotment of any rights, or in order to make a determination of Shareholders for any other proper purpose. The record date, in any case, shall not be more than one hundred eighty (180) days, and in the case of a meeting of Shareholders not less than ten (10) days, prior to the date on which such meeting is to be held or the date on which such other particular action requiring determination of Shareholders is to be taken, as the case may be. In the case of a meeting of Shareholders, the meeting date set forth in the notice to Shareholders accompanying the proxy statement shall be the date used for purposes of calculating the 180 day or 10 day period, and any -14- adjourned meeting may be reconvened without a change in record date. In lieu of fixing a record date, the Trustees may provide that the transfer books shall be closed for a stated period but not to exceed, in any case, twenty (20) days. If the transfer books are closed for the purpose of determining Shareholders entitled to notice of a vote at a meeting of Shareholders, such books shall be closed for at least ten (10) days immediately preceding the meeting. Section 11.3. Seal. The Trustees shall adopt a seal, which shall be in such form and shall have such inscription thereon as the Trustees may from time to time provide. The seal of the Trust may be affixed to any document, and the seal and its attestation may be lithographed, engraved or otherwise printed on any document with the same force and effect as if it had been imprinted and attested manually in the same manner and with the same effect as if done by a Massachusetts business corporation under Massachusetts law. Section 11.4. Fiscal Year. The fiscal year of the Trust shall end on such date as the Trustees may by resolution specify, and the Trustees may by resolution change such date for future fiscal years at any time and from time to time. Section 11.5. Orders for Payment of Money. All orders or instructions for the payment of money of the Trust, and all notes or other evidences of indebtedness issued in the name of the Trust, shall be signed by such officer or officers or such other person or persons as the Trustees may from time to time designate, or as may be specified in or pursuant to the agreement between the Trust and the bank or trust company appointed as Custodian of the securities and funds of the Trust. ARTICLE XII COMPLIANCE WITH FEDERAL REGULATIONS The Trustees are hereby empowered to take such action as they may deem to be necessary, desirable or appropriate so that the Trust is or shall be in compliance with any federal or state statute, rule or regulation with which compliance by the Trust is required. ARTICLE XIII AMENDMENTS These By-Laws may be amended, altered, or repealed, or new By-Laws may be adopted, (a) by a Majority Shareholder Vote, or (b) by the Trustees; provided, however, that no By-Law may be amended, adopted or repealed by the Trustees if such amendment, adoption or repeal requires, pursuant to law, the Declaration, or these By-Laws, a vote of the Shareholders. The Trustees shall in no event adopt By-Laws which are in conflict with the Declaration, and any apparent inconsistency shall be construed in favor of the related provisions in the Declaration. ARTICLE XIV DECLARATION OF TRUST The Declaration of Trust establishing Morgan Stanley Insured Municipal Bond Trust, dated February 27, 1990, a copy of which, together with all amendments thereto, is on file in the office of the Secretary of the Commonwealth of Massachusetts, provides that the name Morgan Stanley Insured Municipal Bond Trust refers to the Trustees under the Declaration collectively as Trustees, but not as individuals or personally; and no Trustee, Shareholder, officer, employee or agent of Morgan Stanley -15- Insured Municipal Bond Trust shall be held to any personal liability, nor shall resort be had to their private property for the satisfaction of any obligation or claim or otherwise, in connection with the affairs of said Morgan Stanley Insured Municipal Bond Trust, but the Trust Estate only shall be liable. -16- ~~-----END PRIVACY-ENHANCED MESSAGE-----~~