<SEC-DOCUMENT>0001258897-13-000208.txt : 20130429
<SEC-HEADER>0001258897-13-000208.hdr.sgml : 20130427
<ACCEPTANCE-DATETIME>20130429094949
ACCESSION NUMBER: 0001258897-13-000208
CONFORMED SUBMISSION TYPE: NSAR-B
PUBLIC DOCUMENT COUNT: 3
CONFORMED PERIOD OF REPORT: 20130228
FILED AS OF DATE: 20130429
DATE AS OF CHANGE: 20130429
EFFECTIVENESS DATE: 20130429
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: Invesco Van Kampen Trust for Value Municipals
CENTRAL INDEX KEY: 0000880893
IRS NUMBER: 363797563
STATE OF INCORPORATION: MA
FISCAL YEAR END: 1031
FILING VALUES:
FORM TYPE: NSAR-B
SEC ACT: 1940 Act
SEC FILE NUMBER: 811-06472
FILM NUMBER: 13789418
BUSINESS ADDRESS:
STREET 1: 1555 PEACHTREE STREET, N.E.
STREET 2: SUITE 1800
CITY: ATLANTA
STATE: 2Q
ZIP: 30309
BUSINESS PHONE: 404-439-3217
MAIL ADDRESS:
STREET 1: 1555 PEACHTREE STREET, N.E.
STREET 2: SUITE 1800
CITY: ATLANTA
STATE: 2Q
ZIP: 30309
FORMER COMPANY:
FORMER CONFORMED NAME: Invesco Van Kampen Trust for Insured Municipals
DATE OF NAME CHANGE: 20100601
FORMER COMPANY:
FORMER CONFORMED NAME: VAN KAMPEN TRUST FOR INSURED MUNICIPALS
DATE OF NAME CHANGE: 19981006
FORMER COMPANY:
FORMER CONFORMED NAME: VAN KAMPEN AMERICAN CAPITAL TRUST FOR INSURED MUNICIPALS
DATE OF NAME CHANGE: 19960102
</SEC-HEADER>
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<PAGE> PAGE 2
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SIGNATURE KELLI GALLEGOS
TITLE ASST VP & TREASURER
</TEXT>
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<DOCUMENT>
<TYPE>EX-99.77Q1A
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<PAGE>
Sub-Item 77Q1(a)
BYLAWS OF INVESCO VAN KAMPEN TRUST FOR VALUE MUNICIPALS,
A DELAWARE STATUTORY TRUST
Adopted effective May 15, 2012
Capitalized terms not specifically defined herein
shall have the meanings ascribed to them in the Trust's
Amended and Restated Agreement and Declaration of Trust (the "Agreement").
ARTICLE I
OFFICES
Section 1. Registered Office. The registered office of Invesco Van Kampen
Trust for Value Municipals (the "Trust") shall be at the offices of The
Corporation Trust Company in the County of New Castle, State of Delaware.
Section 2. Other Offices. The Trust may also have offices at such other
places both within and without the State of Delaware as the Trustees may from
time to time determine or the business of the Trust may require.
ARTICLE II
TRUSTEES
Section 1. Meetings of the Trustees. The Trustees of the Trust may hold
meetings, both regular and special, either within or without the State of
Delaware. Meetings of the Trustees may be called orally or in writing by or at
the direction of the Chair or his or her designee or by a majority of the
Trustees. Meetings of the Board of Trustees and any committee or sub-committee
thereof may be held in person or by telephonic or other electronic means.
Section 2. Regular Meetings. Regular meetings of the Board of Trustees shall
be held each year, at such time and place as the Board of Trustees may
determine.
Section 3. Notice of Meetings. Notice of the time, date, and place of all
meetings of the Board of Trustees and any committee or sub-committee thereof
shall be given to each Trustee, committee member or sub-committee member, as
applicable, (i) by telephone, telex, telegram, facsimile, electronic-mail, or
other electronic mechanism sent to his or her home or business address at least
twenty-four hours in advance of the meeting; (ii) in person at another meeting
of the Board of Trustees or such committee or sub-committee, as applicable; or
(iii) by written notice mailed or sent via overnight courier to his or her home
or business address at least seventy-two hours in advance of the meeting.
Notice need not be given to any Trustee, committee member or sub-committee
member who attends a meeting of the Board of Trustees or any committee or
sub-committee thereof without objecting to the lack of notice or who signs a
waiver of notice either before or after such meeting.
Section 4. Quorum. At all meetings of the Board of Trustees and any
committee or sub-committee thereof, one-third of the Trustees then in office or
one-third of the committee members or sub-committee members (but in no event
less than two Trustees, committee members or sub-committee members), as
applicable, shall constitute a quorum for the transaction of business. The act
of a majority of the Trustees, committee members or sub-
<PAGE>
committee members present at any meeting at which there is a quorum shall be
the act of the Board of Trustees or such committee or sub-committee, as
applicable, except as may be otherwise specifically provided by applicable law
or by the Governing Instrument. If a quorum shall not be present at any meeting
of the Board of Trustees or any committee or sub-committee thereof, the
Trustees, committee members or sub-committee members, as applicable, present
thereat may adjourn such meeting from time to time, without notice other than
announcement at the meeting, until a quorum shall be present.
Section 5. Designation, Powers, and Names of Committees; Sub-Committees;
Committee Charters. Subject to Section 4.3 of the Agreement, the Board of
Trustees may, by resolution passed by a majority of the whole Board, designate
one or more committees, including ad hoc committees to address specified
issues, each of which may, if deemed advisable by the Board of Trustees, have a
written Charter. Each committee shall consist of two or more of the Trustees of
the Trust. The Board may designate one or more Trustees as alternate members of
any committee, who may replace any absent or disqualified member at any meeting
of such committee. Each committee, other than ad hoc committees, shall have a
written charter governing its membership, duties and operations, and the Board
shall designate the powers of each such committee in its charter. Each
committee, to the extent provided in the resolution and/or in such committee's
charter, if applicable, shall have and may exercise the powers of the Board of
Trustees in the management of the business and affairs of the Trust; provided,
however, that in the absence or disqualification of any member of such
committee or committees, the member or members thereof present at any meeting
and not disqualified from voting, whether or not such members constitute a
quorum, may unanimously appoint another member of the Board of Trustees to act
at the meeting in the place of any such absent or disqualified member. Any
committee or committees shall have such name or names as may be determined from
time to time by resolution adopted by the Board of Trustees and/or as set forth
in the written charter of such committee or committees, if applicable. The
Board of Trustees may terminate any such committee at its discretion. Subject
to Section 4.3 of the Agreement, the Board of Trustees may, by resolution
passed by a majority of the whole Board, establish one or more sub-committees
of any committee, and the membership, duties and operations of each such
sub-committee shall be set forth in the written charter of the applicable
committee.
Section 6. Chair; Vice Chair. The Board of Trustees shall have a Chair, who
shall be a Trustee. The Chair shall be elected by a majority of the Trustees,
including a majority of the Trustees who are not "interested persons," as such
term is defined in the 1940 Act. The Board of Trustees may also have a Vice
Chair, who shall be a Trustee. The Vice Chair shall be elected by a majority of
the Trustees, including a majority of the Trustees who are not "interested
persons," as such term is defined in the 1940 Act. The Chair shall preside at
all meetings of the Shareholders and the Board of Trustees, if the Chair is
present, shall approve the agendas of all meetings of the Shareholders and the
Board of Trustees and shall establish rules for the orderly conduct of meetings
of the Shareholders and the Board of Trustees. The Chair shall have such other
powers and duties as shall be determined by the Board of Trustees, and shall
undertake such other assignments as may be requested by the Board of Trustees.
If the Chair shall not be present, the Vice Chair, if any, shall preside at all
meetings of the Shareholders and the Board of Trustees, if the Vice Chair is
present. The Vice Chair shall have such other powers and duties as shall be
determined by the Chair or the Board of Trustees, and shall undertake such
other assignments as may be requested by the Chair or the Board of Trustees.
2
<PAGE>
ARTICLE III
OFFICERS
Section 1. Executive Officers. The executive officers shall include a
Principal Executive Officer, a President, one or more Vice Presidents, which
may include one or more Executive Vice Presidents and/or Senior Vice Presidents
(the number thereof to be determined by the Board of Trustees), a Principal
Financial Officer, a Chief Legal Officer, a Chief Compliance Officer, a
Treasurer, a Secretary and an Anti-Money Laundering Compliance Officer. The
Board of Trustees may also in its discretion appoint Assistant Vice Presidents,
Assistant Secretaries, Assistant Treasurers, and other officers, agents and
employees, who shall have such authority and perform such duties as the Board
may determine. The Board of Trustees may fill any vacancy that may occur in any
office. Any two offices, except for those of President and Vice President, may
be held by the same person, but no officer shall execute, acknowledge or verify
any instrument on behalf of the Trust in more than one capacity, if such
instrument is required by law or by these Bylaws to be executed, acknowledged
or verified by two or more officers.
Section 2. Term of Office. Unless otherwise specifically determined by the
Board of Trustees, the officers shall serve at the pleasure of the Board of
Trustees. If the Board of Trustees in its judgment finds that the best
interests of the Trust will be served, the Board of Trustees may remove any
officer of the Trust at any time with or without cause. The Trustees may
delegate this power to the President (without supervision by the Trustees) with
respect to any other officer. Such removal shall be without prejudice to the
contract rights, if any, of the person so removed. Any officer may resign from
office at any time by delivering a written resignation to the Trustees or the
President. Unless otherwise specified therein, such resignation shall take
effect upon delivery.
Section 3. Principal Executive Officer. The Principal Executive Officer
shall be the chief executive officer of the Trust and shall generally manage
the business and affairs of the Trust. The Principal Executive Officer shall be
responsible for making the certifications required of the Trust's principal
executive officer by Sections 302 and 906 of the Sarbanes-Oxley Act of 2002, as
amended, and the rules promulgated thereunder by the Securities and Exchange
Commission (the "Commission").
Section 4. President; Vice Presidents. The President and one or more Vice
Presidents, which may include one or more Executive Vice Presidents and/or
Senior Vice Presidents, shall have and exercise such powers and duties of the
Principal Executive Officer in the absence or inability to act of the Principal
Executive Officer, as may be assigned to them, respectively, by the Board of
Trustees or, to the extent not so assigned, by the Principal Executive Officer.
In the absence or inability to act of the Principal Executive Officer, the
powers and duties of the Principal Executive Officer not otherwise assigned by
the Board of Trustees or the Principal Executive Officer shall devolve first
upon the President, then upon the Executive Vice Presidents, then upon the
Senior Vice Presidents, and finally upon the Vice Presidents, all in the order
of their election. If both the Chair and the Vice Chair are absent, or if the
Chair is absent and there is no Vice Chair, the President shall, if present,
preside at all meetings of the Shareholders.
Section 5. Principal Financial Officer. The Principal Financial Officer, who
shall also have a title of at least Vice President, shall be the chief
financial officer of the Trust and shall generally manage the financial affairs
of the Trust. The Principal Financial Officer shall be responsible for making
the certifications required of the Trust's principal financial officer by
Sections 302 and 906 of the Sarbanes-Oxley Act of 2002, as amended, and the
rules promulgated thereunder.
3
<PAGE>
Section 6. Chief Legal Officer. The Chief Legal Officer, who shall also have
a title of at least Senior Vice President, shall generally manage the legal
affairs of the Trust. The Chief Legal Officer shall be responsible for
receiving up-the-ladder reports within the Trust of any evidence of material
violations of securities laws or breaches of fiduciary duty or similar
violations by the Trust, as required by Section 307 of the Sarbanes-Oxley Act
of 2002, as amended, and the rules promulgated thereunder.
Section 7. Chief Compliance Officer. The Chief Compliance Officer, who shall
also have a title of at least Senior Vice President, shall be responsible for
administering the Trust's policies and procedures adopted pursuant to Rule
38a-1(a)(1) under the 1940 Act.
Section 8. Treasurer. The Treasurer shall have the care and custody of the
funds and securities of the Trust and shall deposit the same in the name of the
Trust in such bank or banks or other depositories, subject to withdrawal in
such manner as these Bylaws or the Board of Trustees may determine. The
Treasurer shall, if required by the Board of Trustees, give such bond for the
faithful discharge of duties in such form as the Board of Trustees may require.
Section 9. Secretary. The Secretary shall (a) have custody of the seal of
the Trust, if any; (b) if requested, attend meetings of the Shareholders, the
Board of Trustees, and any committees or sub-committees of Trustees; (c) keep
or cause to be kept the minutes of all meetings of Shareholders, the Board of
Trustees and any committees or sub-committees thereof; and (d) issue all
notices of the Trust. The Secretary shall have charge of the Shareholder
records and such other books and papers as the Board may direct, and shall
perform such other duties as may be incidental to the office or which are
assigned by the Board of Trustees.
Section 10. Anti-Money Laundering Compliance Officer. The Anti-Money
Laundering Compliance Officer shall have such powers and duties as are set
forth in the Anti-Money Laundering Program adopted by the Trust pursuant to the
USA PATRIOT Act of 2001 and the rules promulgated thereunder, as such Program
may be amended from time to time.
Section 11. Assistant Officers. Assistant officers, which may include one or
more Assistant Vice Presidents, Assistant Secretaries and Assistant Treasurers,
shall perform such functions and have such responsibilities as the Board of
Trustees may assign to them or, to the extent not so assigned, by the
President, Vice President(s), Secretary or Treasurer, as applicable.
Section 12. Surety Bond. The Trustees may require any officer or agent of
the Trust to execute a bond (including, without limitation, any bond required
by the 1940 Act and the rules and regulations of the Commission) to the Trust
in such sum and with such surety or sureties as the Trustees may determine,
conditioned upon the faithful performance of his or her duties to the Trust,
including responsibility for negligence and for the accounting of any of the
Trust's property, funds, or securities that may come into his or her hands.
Section 13. Authorized Signatories. Unless a specific officer is otherwise
designated in these Bylaws or in a resolution adopted by the Board of Trustees,
the proper officers of the Trust for executing agreements, documents and
instruments other than Internal Revenue Service forms shall be the Principal
Executive Officer, the President, any Vice President, the
4
<PAGE>
Principal Financial Officer, the Chief Legal Officer, the Chief Compliance
Officer, the Treasurer, the Secretary, the Anti-Money Laundering Compliance
Officer, any Assistant Vice President, any Assistant Treasurer or any Assistant
Secretary. Unless a specific officer is otherwise designated in these Bylaws or
in a resolution adopted by the Board of Trustees, the proper officers of the
Trust for executing any and all Internal Revenue Service forms shall be the
Principal Executive Officer, the President, any Vice President, the Principal
Financial Officer, the Treasurer, the Secretary, any Assistant Treasurer or any
Assistant Secretary.
ARTICLE IV
MEETINGS OF SHAREHOLDERS
Section 1. Purpose. All meetings of the Shareholders for the election of
Trustees shall be held at such time and place as may be fixed from time to time
by the Trustees, or at such other place either within or without the State of
Delaware as shall be designated from time to time by the Trustees and stated in
the notice indicating that a meeting has been called for such purpose. Meetings
of Shareholders may be held for any other purpose determined by the Trustees
and may be held at such time and place, within or without the State of Delaware
as shall be stated in the notice of the meeting or in a duly executed waiver of
notice thereof. At all meetings of the Shareholders, every Record Owner
entitled to vote on a matter to be voted on by such Shares shall be entitled to
vote on such matter at such meeting either in person or by written proxy signed
by the Record Owner or by his duly authorized attorney in fact. A Record Owner
may duly authorize such attorney in fact through written, electronic,
telephonic, computerized, facsimile, telecommunication, telex or oral
communication or by any other form of communication. Unless a proxy provides
otherwise, such proxy is not valid more than eleven months after its date. A
proxy with respect to shares held in the name of two or more persons shall be
valid if executed by any one of them unless at or prior to exercise of the
proxy the Trust receives a specific written notice to the contrary from any one
of them. A proxy purporting to be executed by or on behalf of a Record Owner
shall be deemed valid unless challenged at or prior to its exercise and the
burden of proving invalidity shall rest on the challenger.
Section 2. Election of Trustees. All meetings of Shareholders for the
purpose of electing Trustees shall be held on such date and at such time as
shall be designated from time to time by the Trustees and stated in the notice
of the meeting, at which the Shareholders shall elect the number of Trustees as
provided in the Agreement and as the notice for such meeting shall state are to
be elected, and transact such other business as may properly be brought before
the meeting in accordance with Section 1 of this Article IV.
Section 3. Notice of Meetings. Written notice of any meeting stating (a) the
place, date, and hour of the meeting and (b) the purpose or purposes for which
the meeting is called, shall be given to each Shareholder entitled to vote on a
matter to be voted on by such shares at such meeting not less than ten days
before the date of the meeting in accordance with Article V hereof.
Section 4. Special Meetings. Special meetings of the Shareholders, for any
purpose or purposes, unless otherwise prescribed by applicable law or by the
Agreement, may be called by the Chair or by a majority of the Trustees. For the
avoidance of doubt, Shareholders shall have no power to call special meetings
of Shareholders.
Section 5. Conduct of Meeting. Business transacted at any meeting of
Shareholders shall be limited to (a) the purpose stated in the notice, (b) such
other matters as are permitted to
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be presented at the meeting in accordance with Section 15 of this Article IV,
and (c) the adjournment of such meeting in accordance with Section 14 of this
Article IV.
Section 6. Quorum. A majority of the outstanding Shares entitled to vote at
a Shareholders' meeting, which are present in person or represented by proxy,
shall constitute a quorum at the Shareholders' meeting, except when a larger
quorum is required by applicable law or the requirements of any securities
exchange on which Shares are listed for trading, in which case such quorum
shall comply with such requirements. Quorum shall be determined with respect to
the meeting as a whole regardless of whether particular matters have achieved
the requisite vote for approval, but the presence of a quorum shall not prevent
any adjournment at the meeting pursuant to Section 14 of this Article IV.
Section 7. Organization of Meetings.
(a) The meetings of the Shareholders shall be presided over by the
Chair, or if the Chair shall not be present, by the Vice Chair, if any, or if
the Vice Chair shall not be present or if there is no Vice Chair, by the
President, or if the President shall not be present, by a Vice President, or if
no Vice President is present, by a chair appointed for such purpose by the
Board of Trustees or, if not so appointed, by a chair appointed for such
purpose by the officers and Trustees present at the meeting. The Secretary of
the Trust, if present, shall act as Secretary of such meetings, or if the
Secretary is not present, an Assistant Secretary of the Trust shall so act, and
if no Assistant Secretary is present, then a person designated by the Secretary
of the Trust shall so act, and if the Secretary has not designated a person,
then the meeting shall elect a secretary for the meeting.
(b) The Board of Trustees of the Trust shall be entitled to make such
rules and regulations for the conduct of meetings of Shareholders as it shall
deem necessary, appropriate or convenient. Subject to such rules and
regulations of the Board of Trustees, if any, the chair of the meeting shall
have the right and authority to prescribe such rules, regulations and
procedures and to do all such acts as, in the judgment of such chair, are
necessary, appropriate or convenient for the proper conduct of the meeting,
including, without limitation, establishing: an agenda or order of business for
the meeting; rules and procedures for maintaining order at the meeting and the
safety of those present; limitations on participation in such meeting to
shareholders of record of the Trust and their duly authorized and constituted
proxies, and such other persons as the chairman shall permit; restrictions on
entry to the meeting after the time fixed for the commencement thereof;
limitations on the time allotted to questions or comments by participants; and
regulation of the opening and closing of the polls for balloting on matters
which are to be voted on by ballot. Unless and to the extent otherwise
determined by the Board of Trustees or the chair of the meeting, meetings of
Shareholders shall not be required to be held in accordance with the rules of
parliamentary procedure.
Section 8. Voting Standard. When a quorum is present at any meeting, the
vote of the Shares as set forth in the Agreement shall decide any question
brought before such meeting, unless a different vote is required by the express
provision of applicable law, the Governing Instrument or applicable contract,
in which case such express provision shall govern and control the decision of
such question. Where a separate vote by classes is required, the preceding
sentence shall apply to such separate votes by classes.
Section 9. Voting Procedure. Each Record Owner as of the record date
established pursuant to Section 13 of this Article IV shall be entitled to one
vote for each whole Share and a
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proportionate fractional vote for each fractional Share owned of record on the
record date by such Shareholder.
Section 10. Action Without Meeting. Unless otherwise provided in the
Agreement or applicable law, any action required to be taken at any meeting of
the Shareholders, or any action which may be taken at any meeting of the
Shareholders, may be taken without a meeting, without prior notice and without
a vote, if a consent in writing, setting forth the action so taken, shall be
signed by the holders of outstanding Shares of a class of Shares having not
less than the minimum number of votes that would be necessary to authorize or
take such action at a meeting at which all Shares of such class entitled to
vote thereon were present and voted. Prompt notice of the taking of any such
action without a meeting by less than unanimous written consent shall be given
to those Shareholders of such class of Shares who have not consented in writing.
Section 11. Broker Non-Votes. At any meeting of Shareholders, the Trust will
consider broker non-votes, if any, as "entitled to vote," and therefore present
for purposes of determining whether a quorum is present at the meeting and the
percentage of outstanding Shares present in person or by proxy and entitled to
vote at the meeting.
Section 12. Abstentions. At any meeting of Shareholders, the Trust will
consider abstentions, if any, as "entitled to vote," and therefore present for
purposes of determining whether a quorum is present at the meeting and the
percentage of outstanding Shares present in person or by proxy and entitled to
vote at the meeting.
Section 13. Record Date for Shareholder Meetings and Consents. In order that
the Trustees may determine the Record Owners entitled to notice of or to vote
at any meeting of Shareholders or any adjournment thereof, or to express
consent to action in writing without a meeting, the Board of Trustees may fix a
record date, which record date shall not precede the date upon which the
resolution fixing the record date is adopted by the Board of Trustees, and
which record date shall not be more than ninety nor less than ten days before
the original date upon which the meeting of Shareholders is scheduled. A
determination of Record Owners of record entitled to notice of or to vote at a
meeting of Shareholders shall apply to any adjournment of the meeting;
provided, however, that the Board of Trustees may fix a new record date for the
adjourned meeting so long as notice of the adjournment and the new record and
meeting dates are given to the Shareholders.
Section 14. Adjournments.
(a) If (1) a quorum is not present or represented at any meeting of the
Shareholders convened on the date for which it was called, or (2) a quorum is
present at a meeting of Shareholders but sufficient votes to approve a proposal
have not been received, then the affirmative vote of a majority of Shares
present in person or by proxy and entitled to vote at the meeting (even though
not constituting a quorum), or the chair of the meeting in his or her
discretion, shall have power to adjourn the meeting from time to time without
notice other than announcement at the meeting. At such adjourned meeting,
provided a quorum is present, any business may be transacted that might have
been transacted at the meeting as originally notified.
(b) A meeting of Shareholders may be adjourned from time to time without
further notice to Shareholders to a date not more than 120 days after the
original meeting date. A meeting of Shareholders may not be adjourned for more
than 120 days after the original
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meeting date without giving the Shareholders notice of the adjournment and the
new meeting date.
(c) In voting for adjournment, the persons named as proxies may vote
their proxies (including those marked "withhold," "against" or "abstain") in
favor of one or more adjournments of the meeting, or the chair of the meeting
may call an adjournment, provided such Persons determine that such adjournment
is reasonable and in the best interests of Shareholders and the Trust, based on
a consideration of such factors as they may deem relevant.
Section 15. 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.
(b) For any matter to be properly brought before any annual meeting of
Shareholders, the matter must be:
(1) Specified in the notice of annual meeting given by or at the
direction of the Board of Trustees;
(2) Otherwise brought before the annual meeting by or at the
direction of the Board of Trustees; or
(3) Brought before the annual meeting in the manner specified in this
Section by a Record Owner at the time of the giving of notice provided
for in this Section, on the record date for such meeting 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 the time of the giving
of notice provided for in this Section, on the record date for such
meeting and at the time of the meeting.
(c) In addition to any other requirements under applicable law and the
Governing Instrument 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 ninety (90) nor more than one
hundred twenty (120) days prior to the first anniversary date of the annual
meeting for the preceding year. A person may be nominated by a Shareholder for
election as a Trustee of the Trust only by a holder of a class of Shares
entitled to vote on the election of such nominee.
(d) 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
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provided herein by the later of the close of business on (i) the date ninety
(90) 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; provided, however, that if the Other Annual Meeting Date was
disclosed in the proxy statement for the prior year's annual meeting, than the
dates for receipt of the Shareholder Notice shall be calculated in accordance
with Section 15(c) above based on such Other Annual Meeting Date and disclosed
in the proxy statement for the prior year's annual meeting.
(e) Notwithstanding anything in these Bylaws 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.
(f) 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:
(1) A statement in writing with respect to the person or persons to be
nominated (a "Proposed Nominee") setting forth:
(A) The name, age, business address, residence address and principal
occupation or employment of the Proposed Nominee;
(B) The number and class of all Shares of the Trust owned of record
and beneficially by each such Proposed Nominee and the date(s) of
acquisition of such Shares, together with records evidencing such
holdings;
(C) The name of each nominee holder of Shares owned beneficially but
not of record by such Proposed Nominee, the number and class of such
Shares held by each such nominee holder and the date(s) of acquisition
of such Shares, together with records evidencing such holdings;
(D) The number and class of all Shares (i) which the Proposed Nominee
has the right to acquire pursuant to any agreement or upon exercise of
conversion rights or warrants, or otherwise or (ii) which are
beneficially owned, directly or indirectly (including Shares deemed
owned through application of clause (i) above), by any other Person or
group with which the Proposed Nominee or its "affiliate" or "associate,"
as those terms are defined in Rule 12b-2, or any successor rule, under
the 1934 Act, has any agreement, arrangement, or understanding for the
purpose of acquiring, holding, voting, or disposing of Shares, or which
is its "affiliate" or "associate" as so defined;
(E) The information regarding each such Proposed Nominee required by
paragraph (b) of Item 22 of Rule 14a-101 under the 1934 Act, adopted by
the
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Commission (or the corresponding provisions of any regulation or rule
subsequently adopted by the Commission applicable to the Trust);
(F) Whether such Shareholder believes any Proposed Nominee will be an
"interested person" of the Trust (as defined in the 1940 Act), and, if
not an "interested person", information regarding each Proposed Nominee
that will be sufficient for the Trust to make such determination; and
(G) A description of any agreement, arrangement or understanding,
whether written or oral (including any derivative or short positions,
profit interests, options or similar rights and borrowed or loaned
shares) that has been entered into as of the date of the Shareholder
Notice by, or on behalf of, such Proposed Nominee (i) the effect or
intent of which is to mitigate loss to, manage risk or benefit of share
price changes for, or increase or decrease the voting power of such
Proposed Nominee; or (ii) related to such nomination;
(H) Each such Proposed Nominee's signed consent to serve as a Trustee
of the Trust if elected; and
(I) Each Proposed Nominee's written representation that he or she is
not ineligible under Section 9(a) of the 1940 Act and is not covered by,
or subject to a proceeding regarding Section 9(b) of the 1940 Act and an
agreement to complete and execute the Trust's form of trustee
questionnaire.
(2) Such other information as is required by Section 15(h) below.
(g) Any Shareholder who gives a Shareholder Notice of any matter
proposed to be brought before the meeting shall deliver, as part of such
Shareholder Notice:
(1) The text of the proposal to be presented;
(2) A brief written statement of the reasons why such Shareholder favors
the proposal; and
(3) Any material interest of such Shareholder in the matter proposed
(other than as a Shareholder).
(h) Any Shareholder who gives a Shareholder Notice of any matter
proposed to be brought before the meeting or to elect Proposed Nominees shall
deliver, as part of such Shareholder Notice:
(1) 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;
(2) A representation whether the Shareholder or the beneficial owner, if
any, intends or is part of a group which intends to solicit proxies from
Shareholders in support of such proposal or nomination;
(3) Any other information relating to such Shareholder and such
beneficial owner that would be required to be disclosed in a proxy statement
or other
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filing required to be made in connection with the solicitation of proxies by
such Person with respect to the proposed business to be brought by such
Person before the annual meeting pursuant to Section 14 of the 1934 Act and
the rules and regulations promulgated thereunder, whether or not such Person
intends to deliver a proxy statement or solicit proxies; and
(4) A statement in writing with respect to the Shareholder and the
beneficial owner, if any, on whose behalf the proposal is being made setting
forth:
(A) The name and address of such Shareholder, as they appear on the
Trust's books, and of such beneficial owner;
(B) The number and class of Shares which are owned beneficially and
of record by such Shareholder and such beneficial owner, and the date(s)
of acquisition of such shares, together with records evidencing such
holdings;
(C) The name of each nominee holder of Shares owned beneficially but
not of record by such Shareholder and beneficial owner, and the number
and class of such Shares held by each such nominee holder, and the
date(s) of acquisition of such shares, together with records evidencing
such holdings;
(D) The number and class of all Shares (i) which the Shareholder has
the right to acquire pursuant to any agreement or upon exercise of
conversion rights or warrants, or otherwise or (ii) which are
beneficially owned, directly or indirectly (including Shares deemed
owned through application of clause (i) above), by any other Person or
group with which the nominating Shareholder or its "affiliate" or
"associate," as those terms are defined in Rule 12b-2, or any successor
rule, under the 1934 Act, has any agreement, arrangement, or
understanding for the purpose of acquiring, holding, voting, or
disposing of Shares, or which is its "affiliate" or "associate" as so
defined; and
(E) A description of any agreement, arrangement or understanding,
whether written or oral (including any derivative or short positions,
profit interests, options or similar rights and borrowed or loaned
shares) that has been entered into as of the date of the Shareholder
Notice by, or on behalf of, such Shareholder or such beneficial owners
(i) the effect or intent of which is to mitigate loss to, manage risk or
benefit of share price changes for, or increase or decrease the voting
power of such Shareholder or such beneficial owner; or (ii) related to
such proposal.
(i) A Shareholder providing notice of any nomination or other business
proposed to be brought before an annual meeting of Shareholders shall further
update and supplement such notice, if necessary, so that the information
provided or required to be provided in the notice of the annual meeting
delivered pursuant to Section 3 of this Article shall be true and correct as of
the record date for determining the Record Owners entitled to receive notice of
the annual meeting of Shareholders and such update and supplement shall be
received by the Secretary at the principal executive offices of the Trust not
later than five (5) business days before the record date for determining the
Shareholders entitled to receive notice of the annual meeting of Record Owners.
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(j) Notwithstanding the foregoing provisions of this Article, unless
otherwise required by law, if the Shareholder (or a qualified representative of
the Shareholder) does not appear at the annual meeting or special meeting of
Shareholders of the Trust to present a nomination or proposed business, such
nomination shall be disregarded and such proposed business shall not be
transacted, notwithstanding that proxies in respect of such vote may have been
received by the Trust. For purposes of this Article, to be considered a
qualified representative of the Shareholder, a Person must be a duly authorized
officer, manager or partner of such Shareholder or must be authorized by a
writing executed by such Shareholder delivered by such Shareholder to act for
such Shareholder as proxy at the meeting of Shareholders and such Person must
deliver a copy of such writing to the acting secretary at the meeting of
Shareholders.
(k) 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 1934 Act.
(l) 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:
(1) Pursuant to the Trust's notice of meeting;
(2) By or at the direction of the Board of Trustees; or
(3) Provided that the Board of Trustees has determined that Trustees
shall be elected at such special meeting, by:
(A) Any Shareholder of the Trust who is a Record Owner of record at
the time of giving of notice provided for in this Section, at the record
date for such meeting 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; or
(B) 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 the time of giving of notice provided for in this Section, at
the record date for such meeting 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.
(m) 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
Record Owner or Nominee Holder, meeting the requirements of Section 15(l)(3)
above, 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
appropriate Shareholder Notice 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.
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(n) For purposes of this Section, 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
Commission.
(o) 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.
(p) This Section shall not apply to Shareholder proposals made pursuant
to Rule 14a-8 under the 1934 Act.
(q) The chair of 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 and, if not so given, shall direct and declare
at the meeting that such nominees and other matters are out of order and/or
shall not be considered.
ARTICLE V
NOTICES
Section 1. Methods of Giving Notice. Whenever, under the provisions of
applicable law or of the Governing Instrument, notice is required to be given
to any Trustee or Shareholder, it shall not, unless otherwise provided herein,
be construed to mean personal notice, but such notice may be given orally in
person, or by telephone (promptly confirmed in writing) or in writing, by mail
addressed to such Trustee at his or her last given address or to such
Shareholder at his address as it appears on the records of the Trust, with
postage thereon prepaid, and such notice shall be deemed to be given at the
time when the same shall be deposited in the United States mail. Notice to
Trustees or members of a committee or sub-committee may also be given by telex,
telegram, facsimile, electronic-mail or via overnight courier. If sent by telex
or facsimile, notice to a Trustee or member of a committee or sub-committee
shall be deemed to be given upon transmittal; if sent by telegram, notice to a
Trustee or member of a committee or sub-committee shall be deemed to be given
when the telegram, so addressed, is delivered to the telegraph company; if sent
by electronic-mail, notice to a Trustee or member of a committee or
sub-committee shall be deemed to be given and shall be presumed valid when the
Trust's electronic-mail server reflects the electronic-mail message as having
been sent; and if sent via overnight courier, notice to a Trustee or member of
a committee or sub-committee shall be deemed to be given when delivered against
a receipt therefor.
Section 2. Written Waiver. Whenever any notice is required to be given under
the provisions of applicable law, or of the Governing Instrument, a waiver
thereof in writing, signed by the person or persons entitled to said notice,
whether before or after the time stated therein, shall be deemed equivalent
thereto.
ARTICLE VI
UNCERTIFICATED SHARES AND SHARE OWNERSHIP
Section 1. Uncertificated Shares. Except as otherwise required by applicable
law, the rules of any exchange on which the Trust is listed or the Governing
Instrument, the Trust
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shall not issue share certificates and no Shareholder shall have the right to
demand or require that a certificate be issued to him, her or it.
Section 2. Transfer of Shares. Shares shall be transferable on the records
of the Trust only by the record holder thereof or by its agent thereto duly
authorized in writing, upon delivery to the transfer agent of the Trust of a
duly executed instrument of transfer, together with such evidence of the
genuineness of each such execution and authorization and of other matters
(including compliance with any securities laws and contractual restrictions) as
may reasonably be required. Upon such delivery the transfer shall be recorded
on the applicable register of the Trust. Until such record is made, the
Shareholder shall be deemed to be the holder of such Shares for all purposes
hereof and neither the Trustees nor any transfer agent or registrar nor any
officer, employee or agent of the Trust shall be affected by any notice of the
proposed transfer.
Section 3. Record Owners Book. The Trust shall keep or cause to be kept a
Shareholder book, which may be maintained by means of computer systems,
containing the names, alphabetically arranged, of all persons who are Record
Owners of the Trust, showing their places of residence, the number and class of
any Shares held by them, respectively, and the dates when they became the
record owners thereof.
Section 4. Registered Shareholders. The Trust shall be entitled to recognize
the exclusive right of a person registered on its books as the owner of Shares
to receive dividends, and to vote as such owner, and shall not be bound to
recognize any equitable or other claim of interest in such Share or Shares on
the part of any other person, whether or not it shall have express or other
notice hereof.
Section 5. Record Date for Receiving Dividends and Other Actions. In order
that the Trustees may determine the Record Owners entitled to receive payment
of any dividend or other distribution of allotment of any rights, or entitled
to exercise any rights in respect of any change, conversion or exchange of
Shares or for the purpose of any other lawful action (other than the record
date for meetings of shareholders as set forth in Section 13 of Article IV),
the Board of Trustees may fix a record date, which record date (i) shall be set
forth in the resolution or resolutions authorizing the payment of such dividend
or other lawful action and (ii) shall not precede the date upon which the
resolution fixing the record date is adopted by the Board of Trustees.
ARTICLE VII
GENERAL PROVISIONS
Section 1. Seal. The Trust is not required to have any seal, and the
adoption or use of a seal shall be purely ornamental and be of no legal effect.
The seal, if any, of the Trust may be affixed to any instrument, 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 affixed
manually in the same manner and with the same force and effect as if done by a
Delaware business corporation. The presence or absences of a seal shall have no
effect on the validity, enforceability or binding nature of any document or
instrument that is otherwise duly authorized, executed and delivered.
Section 2. Severability. The provisions of these Bylaws are severable. If
any provision hereof shall be held invalid or unenforceable in any
jurisdiction, such invalidity or
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unenforceability shall attach only to such provision only in such jurisdiction
and shall not affect any other provision of these Bylaws.
Section 3. Headings. Headings are placed in these Bylaws for convenience of
reference only and in case of any conflict, the text of these Bylaws rather
than the headings shall control.
ARTICLE VIII
INDEMNIFICATION
Section 1. Indemnification.
(a) To the maximum extent permitted by law, the Trust shall indemnify
any person who was or is a party or is threatened to be made a party to, or is
involved as a witness in, any proceeding (other than a proceeding by or in the
right of the Trust) by reason of the fact that such person is or was a Covered
Person, against expenses, judgments, fines and amounts paid in settlement
actually and reasonably incurred by such person in connection with such
proceeding.
(b) To the maximum extent permitted by law, the Trust shall indemnify
any person who was or is a party or is threatened to be made a party to, or is
involved as a witness in, any proceeding by or in the right of the Trust to
procure a judgment in its favor by reason of the fact that such person is or
was a Covered Person, against expenses actually and reasonably incurred by that
person in connection with the investigation, defense or settlement of such
proceeding.
(c) Notwithstanding any provision to the contrary contained herein, no
Covered Person shall be indemnified for any expenses, judgments, fines, amounts
paid in settlement, or other liability or loss arising by reason of disabling
conduct or for any proceedings by such Covered Person against the Trust. The
termination of any proceeding by conviction, or a plea of nolo contendere or
its equivalent, or an entry of an order of probation prior to judgment, creates
a rebuttable presumption that the person engaged in disabling conduct.
(d) Notwithstanding the foregoing, with respect to any action, suit or
other proceeding voluntarily prosecuted by any indemnitee as plaintiff,
indemnification shall be mandatory only if the prosecution of such action, suit
or other proceeding by such indemnitee (1) was authorized by a majority of the
Trustees or (2) was instituted by the indemnitee to enforce his or her rights
to indemnification hereunder in a case in which the indemnitee is found to be
entitled to such indemnification. The rights to indemnification set forth in
these Bylaws shall continue as to a person who has ceased to be a Trustee or
officer of the Trust and shall inure to the benefit of his or her heirs,
executors and personal and legal representatives. No amendment or restatement
of these Bylaws or repeal of any of its provisions shall limit or eliminate any
of the benefits provided to any person who at any time is or was a trustee or
officer of the Trust or otherwise entitled to indemnification hereunder in
respect of any act or omission that occurred prior to such amendment,
restatement or repeal.
Section 2. Advance Payment of Indemnification Expenses. To the maximum
extent permitted by law, the Trust shall advance to any person who was or is a
party or is threatened to be made a party to, or is involved as a witness in,
any proceeding by reason of the fact that such person is or was a Trustee or
officer of the Trust the expenses actually and reasonably incurred by such
person in connection with the defense of such proceeding in advance of its
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final disposition. To the maximum extent permitted by law, the Trust may
advance to any person who was or is a party or is threatened to be made a party
to any proceeding by reason of the fact that such person is or was a Covered
Person (other than a Trustee or officer of the Trust) the expenses actually and
reasonably incurred by such person in connection with the defense of such
proceeding in advance of its final disposition. Notwithstanding any provision
to the contrary contained herein, the Trust shall not advance expenses to any
Covered Person (including a Trustee or officer of the Trust) unless:
(a) the Trust has received an undertaking by or on behalf of such
Covered Person that the amount of all expenses so advanced will be paid over by
such person to the Trust unless it is ultimately determined that such person is
entitled to indemnification for such expenses; and
(b)(i) such Covered Person shall have provided appropriate security for
such undertaking; (ii) the Trust shall be insured against losses by reason of
any lawful advance payments; or (iii) either (1) the Trustees, by the vote of a
majority of a quorum of qualifying Trustees (as defined in Section 6 below), or
(2) independent legal counsel in a written opinion, shall have determined,
based upon a review of readily available facts (as opposed to a full trial-type
inquiry), that there is reason to believe that such Covered Person ultimately
will be found entitled to indemnification.
Section 3. Determination of Entitlement to Indemnification. Any
indemnification required or permitted under this Article VIII (unless ordered
by a court) shall be made by the Trust only as authorized in the specific case
upon a reasonable determination, based upon a review of the facts, that the
Covered Person is entitled to indemnification because (i) he or she is not
liable by reason of disabling conduct, or (ii) in cases where there is no
liability, he or she has not engaged in disabling conduct. Such determination
shall be made by (i) the vote of a majority of a quorum of qualifying Trustees;
or (ii) if there are no such Trustees, or if such Trustees so direct, by
independent legal counsel in a written opinion. Notwithstanding anything to the
contrary in Section 2 of this Article VIII, if a determination that a Covered
Person engaged in disabling conduct is made in accordance with this Section 3,
no further advances of expenses shall be made, and all prior advances, and
insurance premiums paid for by the Trust, if applicable, must be repaid.
Section 4. Contract Rights. With respect to any person who was or is a party
or is threatened to be made a party to, or is involved as a witness in, any
proceeding by reason of the fact that such person is or was a Covered Person,
the rights to indemnification conferred in Section 1 of this Article VIII, and
with respect to any person who was or is a party or is threatened to be made a
party to, or is involved as a witness in, any proceeding by reason of the fact
that such person is or was a Trustee or officer of the Trust, the advancement
of expenses conferred in Section 2 of this Article VIII shall be contract
rights. Any amendment, repeal, or modification of, or adoption of any provision
inconsistent with, this Article VIII (or any provision hereof) shall not
adversely affect any right to indemnification or advancement of expenses
granted to any such person pursuant hereto with respect to any act or omission
of such person occurring prior to the time of such amendment, repeal,
modification, or adoption (regardless of whether the proceeding relating to
such acts or omissions is commenced before or after the time of such amendment,
repeal, modification, or adoption). Any amendment or modification of, or
adoption of any provision inconsistent with, this Article VIII (or any
provision hereof), that has the effect of positively affecting any right to
indemnification or advancement of expenses granted to any such person pursuant
hereto, shall not apply retroactively to any
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person who was not serving as a Trustee, officer, employee or agent of the
Trust at the time of such amendment, modification or adoption.
Section 5. Claims.
(a) If (X) a claim under Section 1 of this Article VIII with respect to
any right to indemnification is not paid in full by the Trust within sixty days
after a written demand has been received by the Trust or (Y) a claim under
Section 2 of this Article VIII with respect to any right to the advancement of
expenses is not paid in full by the Trust within thirty days after a written
demand has been received by the Trust, then the Covered Person seeking to
enforce a right to indemnification or to an advancement of expenses, as the
case may be, may at any time thereafter bring suit against the Trust to recover
the unpaid amount of the claim.
(b) If successful in whole or in part in any suit brought pursuant to
Section 5(a) of this Article VIII, or in a suit brought by the Trust to recover
an advancement of expenses (whether pursuant to the terms of an undertaking or
otherwise), the Covered Person seeking to enforce a right to indemnification or
an advancement of expenses hereunder or the Covered Person from whom the Trust
sought to recover an advancement of expenses, as the case may be, shall be
entitled to be paid by the Trust the reasonable expenses (including attorneys'
fees) of prosecuting or defending such suit.
Section 6. Definitions. For purposes of this Article VIII: (a) references to
"Trust" include any domestic or foreign predecessor entity of this Trust in a
merger, consolidation, or other transaction in which the predecessor's
existence ceased upon consummation of the transaction; (b) the term "disabling
conduct" means willful misfeasance, bad faith, gross negligence, or the
reckless disregard of the duties involved in the conduct of the Covered
Person's office with the Trust; (c) the term "expenses" includes, without
limitations, attorneys' fees; (d) the term "proceeding" means any threatened,
pending, or completed action, suit, or proceeding, whether civil, criminal,
administrative, or investigative; and (e) the term "qualifying Trustee" means
any Trustee who is not an interested person (as defined in the 1940 Act) of the
Trust and is not a party to the proceeding.
ARTICLE IX
AMENDMENTS
Section 1. Amendments by Trustees. These Bylaws may be altered or repealed
only by the affirmative vote of at least two-thirds (66 2/3%) of the Board of
Trustees, without the vote or approval of the Shareholders, at any regular or
special meeting of the Board of Trustees without prior notice. The Trustees
shall not adopt Bylaws which are in conflict with the Agreement and any
apparent inconsistency shall be construed in favor of the Agreement.
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AMENDMENT TO DECLARATION OF TRUST
for
INVESCO VAN KAMPEN TRUST FOR VALUE MUNICIPALS
CERTIFICATE
The undersigned hereby certifies that he is a Trustee of Invesco Van
Kampen Trust For Value Municipals, an unincorporated business trust organized
and existing under the laws of The Commonwealth of Massachusetts (the "Fund"),
that annexed hereto is the Certificate of Designation dated May 7, 2012 as an
amendment to the Declaration of Trust, establishing the powers, qualifications,
rights and preferences of the Series 2015/6-VIM Variable Rate Muni Term
Preferred Shares of the Fund, which Certificate has been adopted by the Board
of Trustees of the Fund in a manner provided in the Fund's Declaration of Trust.
Dated this May 7, 2012
By: /s/ Wayne W. Whalen
------------------------------
Name: Wayne W. Whalen
Title: Trustee
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<C> <C> <S> <C>
DESIGNATION......................................................................... 1
DEFINITIONS......................................................................... 1
TERMS............................................................................... 15
1. NUMBER OF AUTHORIZED SHARES 15
(a) Authorized Shares.......................................................... 15
(b) Capitalization............................................................. 15
(c) Capital and Surplus........................................................ 15
(d) Reduction of Capital....................................................... 15
(e) Capital Sufficiency........................................................ 16
2. DIVIDENDS 16
(a) Ranking.................................................................... 16
(b) Cumulative Cash Dividends.................................................. 16
(c) Dividends Cumulative from Date of Original Issue........................... 16
(d) Dividend Payment Dates..................................................... 16
(e) Applicable Rates and Calculation of Dividends.............................. 16
(f) Curing a Failure to Deposit................................................ 18
(g) Dividend Payments by Fund to Redemption and Paying Agent................... 18
(h) Redemption and Paying Agent to Hold Dividend Payments by Fund in Trust..... 18
(i) Dividends Paid to Holders.................................................. 18
(j) Dividends Credited Against Earliest Accumulated but Unpaid Dividends....... 19
(k) Dividends Designated as Exempt-Interest Dividends.......................... 19
3. GROSS-UP PAYMENTS AND NOTICE OF ALLOCATIONS 19
4. VOTING RIGHTS 19
(a) One Vote Per VMTP Share.................................................... 19
(b) Voting for Additional Trustees............................................. 20
(c) 1940 Act Matters........................................................... 21
(d) Exclusive Right to Vote on Certain Matters................................. 21
(e) Rights Set Forth Herein Are Sole Rights.................................... 21
(f) No Preemptive Rights or Cumulative Voting.................................. 21
(g) Voting for Trustees Sole Remedy for Fund's Failure to Pay Dividends........ 21
(h) Holders Entitled to Vote................................................... 21
(i) Grant of Irrevocable Proxy................................................. 22
5. AMENDMENTS 22
6. MINIMUM ASSET COVERAGE AND OTHER FINANCIAL REQUIREMENTS 24
(a) Minimum Asset Coverage..................................................... 24
(b) Effective Leverage Ratio................................................... 24
(c) Eligible Assets............................................................ 24
(d) Credit Quality............................................................. 24
(e) Liens...................................................................... 24
7. BASIC MAINTENANCE AMOUNT 24
8. RESTRICTIONS ON DIVIDENDS AND OTHER DISTRIBUTIONS 25
</TABLE>
i
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<TABLE>
<C> <C> <S> <C>
(a) Dividends on Preferred Shares Other Than VMTP Shares.......................................................... 25
(b) Dividends and Other Distributions With Respect to Common Shares Under the 1940 Act............................ 25
(c) Other Restrictions on Dividends and Other Distributions....................................................... 25
(d) Sources of Dividends.......................................................................................... 26
9. RATING AGENCY RESTRICTIONS 26
10. REDEMPTION 26
(a) Optional Redemption........................................................................................... 26
(b) Term/Mandatory Redemption..................................................................................... 27
(c) Notice of Redemption.......................................................................................... 30
(d) No Redemption Under Certain Circumstances..................................................................... 31
(e) Absence of Funds Available for Redemption..................................................................... 31
(f) Redemption and Paying Agent to Hold Redemption Payments by Fund in Trust...................................... 31
(g) Shares for Which Deposit Securities Have Been Deposited and Notice of Redemption Has Been Given Are No Longer
Outstanding................................................................................................... 31
(h) Compliance with Applicable Law................................................................................ 32
(i) Only Whole VMTP Shares May Be Redeemed........................................................................ 32
(j) Modification of Redemption Procedures......................................................................... 32
(k) Capital Limitations on Purchases and Redemptions.............................................................. 32
11. LIQUIDATION RIGHTS 32
(a) Ranking....................................................................................................... 32
(b) Distributions Upon Liquidation................................................................................ 32
(c) Pro Rata Distributions........................................................................................ 33
(d) Rights of Junior Shares....................................................................................... 33
(e) Certain Events Not Constituting Liquidation................................................................... 33
(f) Definition of Liabilities..................................................................................... 33
12. TRANSFERS 33
13. MISCELLANEOUS. 34
(a) No Fractional Shares.......................................................................................... 34
(b) Status of VMTP Shares Redeemed, Exchanged or Otherwise Acquired by the Fund................................... 34
(c) Treatment of VMTP Shares as Equity............................................................................ 34
(d) Board May Resolve Ambiguities................................................................................. 34
(e) Headings Not Determinative.................................................................................... 34
(f) Notices....................................................................................................... 34
(g) Redemption and Paying Agent................................................................................... 34
(h) Securities Depository......................................................................................... 34
(i) Voluntary Bankruptcy.......................................................................................... 34
(j) Applicable Law Restrictions and Requirements.................................................................. 34
(k) Information to Holders........................................................................................ 35
(l) Tax Status of the Fund........................................................................................ 36
(m) Maintenance of Existence...................................................................................... 36
(n) Use of Proceeds............................................................................................... 36
(o) Compliance with Law........................................................................................... 36
(p) Maintenance of Approvals: Filings, Etc........................................................................ 36
(q) 1940 Act Registration......................................................................................... 36
(r) Compliance with Eligible Assets Definition.................................................................... 37
(s) Access to Information Relating to Compliance With Eligible Assets Definition.................................. 37
(t) Ratings....................................................................................................... 37
(u) Purchase by Affiliates........................................................................................ 37
(v) Audits........................................................................................................ 37
(w) Personal Liability............................................................................................ 37
(x) Termination................................................................................................... 37
</TABLE>
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<TABLE>
<C> <C> <S> <C>
(y) Actions on Other Than Business Days.............................. 37
14. GLOBAL CERTIFICATE.................................................... 37
Appendix A: Eligible Assets................................................ 1
</TABLE>
iii
<PAGE>
INVESCO VAN KAMPEN TRUST FOR VALUE MUNICIPALS
CERTIFICATE OF DESIGNATION ESTABLISHING AND FIXING THE
RIGHTS AND PREFERENCES OF
VARIABLE RATE MUNI TERM PREFERRED SHARES
WHEREAS the Board of Trustees of Invesco Van Kampen Trust For Value
Municipals (the "FUND") is expressly empowered pursuant to Section 6.1 of the
Declaration of Trust to authorize the issuance of preferred shares of
beneficial interest of the Fund in one or more series, with such preferences,
powers, restrictions, limitations or qualifications as determined by the Board
of Trustees and as set forth in the resolution or resolutions providing for the
issuance of such preferred shares.
AND WHEREAS the Board of Trustees has determined that it is in the best
interest of the Fund to issue one series of such preferred shares.
NOW THEREFORE, the Board of Trustees does hereby authorize the issuance of
preferred shares of beneficial interest of the Fund, par value $0.01 per share,
to be designated Variable Rate Muni Term Preferred Shares (the "VMTP SHARES").
The VMTP Shares may be issued in one or more series, as designated and
authorized by the Board of Trustees or a duly authorized committee thereof from
time to time (each series of VMTP Shares that may be authorized and issued, a
"SERIES").
The preferences (including liquidation preference), voting powers,
restrictions, limitations as to dividends, qualifications, and terms and
conditions of redemption of the shares of each Series of VMTP Shares are as
follows or as set forth in an amendment to this Certificate of Designation or
otherwise in the Declaration of Trust (each such Series being referred to
herein as a "SERIES OF VMTP SHARES"):
DESIGNATION
Series 2015/6-VIM: A series of 522 preferred shares of beneficial interest
of the Fund, par value $0.01 per share, liquidation preference $100,000 per
share, is hereby authorized and designated "Series 2015/6-VIM VMTP Shares".
Each Series 2015/6-VIM VMTP Share shall be issued on a date determined by the
Board of Trustees of the Fund or pursuant to their delegated authority; have an
Applicable Rate for the Initial Rate Period equal to the sum of 1.10% per annum
plus the Securities Industry and Financial Markets Association ("SIFMA")
Municipal Swap Index, published at approximately 3:00 p.m., New York City time,
on Wednesday, May 2, 2012; and have such other preferences, voting powers,
restrictions, limitations as to dividends and distributions, qualifications and
terms and conditions of redemption, required by Applicable Law and that are
expressly set forth in this Certificate of Designation and the Declaration of
Trust. The Series 2015/6-VIM VMTP Shares shall constitute a separate series of
preferred shares of beneficial interest of the Fund and each Series 2015/6-VIM
VMTP Share shall be identical to each other Series 2015/6-VIM VMTP Share.
Except as otherwise provided with respect to any additional Series of VMTP
Shares, the terms and conditions of this Certificate of Designation apply to
each Series of VMTP Shares.
DEFINITIONS
The following terms shall have the following meanings (with terms defined in
the singular having comparable meanings when used in the plural and vice
versa), unless the context otherwise requires:
"1940 ACT" means the U.S. Investment Company Act of 1940 and the Rules and
Regulations thereunder, as amended from time to time.
"ADDITIONAL AMOUNT" has the meaning specified in Section 2(e)(i)(B) of this
Certificate of Designation.
"AFFECTED SERIES" has the meaning set forth in Section 5(d) of this
Certificate of Designation.
"AGENT MEMBER" means a Person with an account at the Securities Depository
that holds one or more VMTP Shares through the Securities Depository, directly
or indirectly, for a Beneficial Owner and that will be
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authorized and instructed, directly or indirectly, by a Beneficial Owner to
disclose information to the Redemption and Paying Agent with respect to such
Beneficial Owner.
"APPLICABLE BASE RATE" means the SIFMA Municipal Swap Index.
"APPLICABLE LAW" means the law of The Commonwealth of Massachusetts and the
federal law of the United States of America (including, without limitation, the
1940 Act).
"APPLICABLE RATE" means the dividend rate per annum on any VMTP Shares for a
Rate Period determined as set forth in Section 2(e)(i) of this Certificate of
Designation or in the definition of "Maximum Rate," as applicable.
"APPLICABLE RATE DETERMINATION" means each periodic operation of the process
of determining the Applicable Rate for the VMTP Shares for a Subsequent Rate
Period.
"APS" has the meaning set forth in Section 13(n) of this Certificate of
Designation.
"BASIC MAINTENANCE AMOUNT," as of any Valuation Date, shall have the meaning
set forth in the Rating Agency Guidelines.
"BASIC MAINTENANCE CURE DATE," with respect to the failure by the Fund to
satisfy the Basic Maintenance Amount (as required by Section 7(a) of this
Certificate of Designation) as of a given Valuation Date, shall have the
meaning set forth in the Rating Agency Guidelines, but in no event shall it be
longer than 10 Business Days following such Valuation Date.
"BENEFICIAL OWNER" means a Person in whose name VMTP Shares are recorded as
beneficial owner of such VMTP Shares by the Securities Depository, an Agent
Member or other securities intermediary on the records of such Securities
Depository, Agent Member or securities intermediary, as the case may be, or, if
applicable, such Person's subrogee.
"BOARD OF TRUSTEES" means the Board of Trustees of the Fund or any duly
authorized committee thereof.
"BROKER-DEALER" means any registered broker-dealer that has indicated on its
BrokerCheck Report (available on FINRA BrokerCheck) under "Firm
Operations--Types of Business" that it is engaged in each of the following
business lines: (i) "Broker or dealer retailing corporate equity securities
over-the-counter;" and (ii) "Underwriter or selling group participant" (of any
type of securities); provided that, if FINRA shall discontinue the existence of
BrokerCheck, "Broker-Dealer" means any registered broker-dealer that engages in
such business lines or substantively equivalent business lines as indicated on
whatever publicly available information source that replaces FINRA BrokerCheck;
provided further that if no publicly available information source replaces
FINRA BrokerCheck, "Broker-Dealer" shall mean any registered broker dealer.
"BUSINESS DAY" means a day (a) other than a day on which commercial banks in
The City of New York, New York are required or authorized by law or executive
order to close and (b) on which the New York Stock Exchange is not closed.
"CERTIFICATE OF DESIGNATION" means this Certificate of Designation
Establishing and Fixing the Rights and Preferences of the VMTP Shares, as
amended from time to time in accordance with the provisions hereof.
"CLOSED-END FUNDS" has the meaning set forth in Section 12(a) of this
Certificate of Designation.
"CLOSING DATE" means May 8, 2012.
"CODE" means the U.S. Internal Revenue Code of 1986, as amended.
"COMMON SHARES" has the meaning set forth in the Declaration of Trust.
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"CONDITIONAL ACCEPTANCE" means a conditional acceptance by the Total Holders
to extend the Term Redemption Date of the VMTP Shares.
"CURE DATE" means the Basic Maintenance Cure Date, the Minimum Asset
Coverage Cure Date or the last day of the Effective Leverage Ratio Cure Period,
as the case may be.
"CUSTODIAN", for purposes of this Certificate of Designation, means a bank,
as defined in Section 2(a)(5) of the 1940 Act, that has the qualifications
prescribed in paragraph 1 of Section 26(a) of the 1940 Act, or such other
entity as shall be providing custodian services to the Fund as permitted by the
1940 Act or order thereunder, and shall include, as appropriate, any similarly
qualified sub-custodian duly appointed by the Custodian.
"DATE OF ORIGINAL ISSUE" means May 8, 2012.
"DECLARATION OF TRUST" means the Declaration of Trust of the Fund, as
amended and supplemented (including by this Certificate of Designation), on
file with the Secretary of The Commonwealth of Massachusetts.
"DEFEASED SECURITIES" means a security for which cash, cash equivalents or
other eligible property has been pledged in an amount sufficient to make all
required payments on such security to and including maturity (including any
accelerated maturity pursuant to a permitted redemption), in accordance with
the instrument governing the issuance of such security.
"DEFERRED COMPENSATION HEDGE ASSETS" has the meaning specified in Appendix A
of this Certificate of Designation.
"DEPOSIT SECURITIES" means, as of any date, any United States
dollar-denominated security or other investment of a type described below that
either (i) is a demand obligation payable to the holder thereof on any Business
Day or (ii) has a maturity date, mandatory redemption date or mandatory payment
date, on its face or at the option of the holder, preceding the relevant
payment date in respect of which such security or other investment has been
deposited or set aside as a Deposit Security:
(1)cash or any cash equivalent;
(2)any U.S. Government Security;
(3)any Municipal Security that has a credit rating from at least one NRSRO
that is the highest applicable rating generally ascribed by such NRSRO
to Municipal Securities with substantially similar terms as of the date
of this Certificate of Designation (or such rating's future equivalent),
including (A) any such Municipal Security that has been pre-refunded by
the issuer thereof with the proceeds of such refunding having been
irrevocably deposited in trust or escrow for the repayment thereof and
(B) any such fixed or variable rate Municipal Security that qualifies as
an eligible security under Rule 2a-7 under the 1940 Act as amended or as
in effect on the Date of Original Issue;
(4)any investment in any money market fund registered under the 1940 Act
that qualifies under Rule 2a-7, or in any similar investment vehicle
described in Rule 12d1-1(b)(2) under the 1940 Act, that invests
principally in Municipal Securities or U.S. Government Securities or any
combination thereof; or
(5)any letter of credit from a bank or other financial institution that has
a credit rating from at least one NRSRO that is the highest applicable
rating generally ascribed by such NRSRO to bank deposits or short-term
debt of similar banks or other financial institutions as of the date of
this Certificate of Designation (or such rating's future equivalent).
"DERIVATIVE CONTRACT" means (a) any and all rate swap transactions, basis
swaps, credit derivative transactions, forward rate transactions, commodity
swaps, commodity options, forward commodity contracts,
3
<PAGE>
forward swap transactions, equity or equity index swaps or options, bond or
bond price or bond index swaps or options or forward bond or forward bond price
or forward bond index transactions, futures contracts, repurchase transactions,
interest rate options, forward foreign exchange transactions, cap transactions,
floor transactions, collar transactions, currency swap transactions,
cross-currency rate swap transactions, currency options, spot contracts, or any
other similar transactions or any combination of any of the foregoing
(including any options to enter into any of the foregoing), whether or not any
such transaction is governed by or subject to any master agreement or cleared
on an exchange or other clearing organization, and (b) any and all transactions
of any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the
International Swaps and Derivatives Association, Inc., any International
Foreign Exchange Master Agreement, or any other master agreement (any such
master agreement, together with any related schedules, a "MASTER AGREEMENT"),
including any obligations or liabilities under any such Master Agreement.
"DERIVATIVE TERMINATION VALUE" means, in respect of any one or more
Derivative Contracts, after taking into account the effect of any legally
enforceable netting agreement relating to such Derivative Contracts, (a) for
any date on or after the date such Derivative Contracts have been closed out
and termination value(s) determined in accordance therewith, such termination
value(s), (b) for any date prior to the date referenced in clause (a), the
amount(s) determined as the mark-to-market value(s) for such Derivative
Contracts, as determined based upon one or more mid-market or other readily
available quotations provided by any recognized dealer in such Derivative
Contracts (which may include a Holder or an affiliate of the Holder) or (c) for
any date on which Derivative Contracts are traded on an exchange, the last
reported sale price.
"DISCOUNTED VALUE," as of any Valuation Date, has the meaning set forth in
the Rating Agency Guidelines.
"DIVIDEND PAYMENT DATE" means the date that is the first Business Day of
each calendar month.
"DIVIDEND PERIOD" means, with respect to the Series 2015/6-VIM VMTP Shares,
in the case of the first Dividend Period, the period beginning on the Date of
Original Issue for such Series and ending on and including May 31, 2012 and for
each subsequent Dividend Period, the period beginning on and including the
first calendar day of the month following the month in which the previous
Dividend Period ended and ending on and including the last calendar day of such
month.
"EFFECTIVE LEVERAGE RATIO" means the quotient of:
(A) the sum of (i) the aggregate liquidation preference of the Fund's
"senior securities" (as that term is defined in the 1940 Act) that are shares
of beneficial interest of the Fund, plus any accumulated but unpaid dividends
thereon, excluding, without duplication, (x) any such senior securities for
which the Fund has issued a notice of redemption (in accordance with the terms
of such senior securities) and either has delivered Deposit Securities or
sufficient funds (in accordance with the terms of such senior securities) to
the paying agent for such senior securities or otherwise has adequate Deposit
Securities on hand and segregated on the books and records of the Custodian for
the purpose of such redemption and (y) the Fund's outstanding Preferred Shares
to be redeemed with the gross proceeds from the sale of VMTP Shares or other
replacement securities, for which the Fund either has delivered Deposit
Securities or sufficient funds (in accordance with the terms of such Preferred
Shares) to the paying agent for such Preferred Shares or otherwise has adequate
Deposit Securities on hand and segregated on the books and records of the
Custodian for the purpose of such redemption; (ii) the aggregate principal
amount of a Fund's "senior securities representing indebtedness" (as that term
is defined in the 1940 Act), plus any accrued but unpaid interest thereon;
(iii) the aggregate principal amount of floating rate trust certificates
corresponding to the associated residual floating rate trust certificates owned
by the Fund (less the aggregate principal amount of any such floating rate
trust certificates owned by the Fund and corresponding to the associated
residual floating rate trust certificates owned by the Fund); and (iv) the
aggregate amount of the Fund's repurchase obligations under repurchase
agreements;
divided by
(B) the sum of (i) the Market Value of the Fund's total assets (including
amounts attributable to senior securities, but excluding any assets consisting
of Deposit Securities relating to senior securities for which the Fund has
issued a notice of redemption (in accordance with the terms of such senior
securities) and either has delivered
4
<PAGE>
Deposit Securities or sufficient funds (in accordance with the terms of such
senior securities) to the paying agent for such senior securities or otherwise
has adequate Deposit Securities on hand and segregated on the books and records
of the Custodian for the purpose of such redemption), less the sum of (A) the
amount of the Fund's accrued liabilities (which accrued liabilities shall
include net obligations of the Fund under each Derivative Contract in an amount
equal to the Derivative Termination Value thereof payable by the Fund to the
related counterparty), other than liabilities for the aggregate principal
amount of senior securities representing indebtedness, and (B) the
Overconcentration Amount; and (ii) the aggregate principal amount of floating
rate trust certificates corresponding to the associated residual floating rate
trust certificates owned by the Fund (less the aggregate principal amount of
any such floating rate trust certificates owned by the Fund and corresponding
to the associated residual floating rate trust certificates owned by the Fund).
"EFFECTIVE LEVERAGE RATIO CURE PERIOD" has the meaning specified in
Section 6(b) of this Certificate of Designation.
"ELECTRONIC MEANS" means email transmission, facsimile transmission or other
similar electronic means of communication providing evidence of transmission
(but excluding online communications systems covered by a separate agreement)
acceptable to the sending party and the receiving party, in any case if
operative as between any two parties, or, if not operative, by telephone
(promptly confirmed by any other method set forth in this definition), which,
in the case of notices to the Redemption and Paying Agent, shall be sent by
such means as set forth in the Redemption and Paying Agent Agreement.
"ELIGIBLE ASSETS" means the instruments listed on Appendix A hereto.
"EXCHANGE ACT" means the U.S. Securities Exchange Act of 1934, as amended.
"EXCLUDED REDEMPTION" means a redemption of 10% or less of the Outstanding
VMTP Shares utilizing redemption proceeds derived from the issuance of tender
option bond securities.
"EXPOSURE PERIOD" has the meaning set forth in the Moody's Guidelines.
"FAILURE TO DEPOSIT" means, with respect to a series of VMTP Shares, a
failure by the Fund to pay to the Redemption and Paying Agent, not later than
12:00 noon, New York City time, (A) on the Business Day immediately preceding
any Dividend Payment Date for such series of VMTP Shares, in funds available on
such Dividend Payment Date in The City of New York, New York, the full amount
of any dividend to be paid on such Dividend Payment Date on any share of such
Series or (B) on the Business Day immediately preceding any Redemption Date for
such series of VMTP Shares in funds available on such Redemption Date in The
City of New York, New York, the Redemption Price to be paid on such Redemption
Date for any share of such Series after Notice of Redemption is provided
pursuant to Section 10(c) of this Certificate of Designation; provided,
however, that, notwithstanding anything expressed or implied herein to the
contrary, (i) the foregoing clause (B) shall not apply to the Fund's failure to
pay the Redemption Price in respect of VMTP Shares when the related Notice of
Redemption provides that redemption of such shares is subject to one or more
conditions precedent and any such condition precedent shall not have been
satisfied at the time or times and in the manner specified in such Notice of
Redemption, and (ii) a Failure to Deposit shall not be deemed to have occurred
if the Fund is unable to make the payments in clause (A) or clause (B) due to
the lack of legally available funds under Applicable Law or because of any
other Applicable Law restrictions on such payments.
"FITCH" means Fitch Ratings, a part of the Fitch Group, which is a
majority-owned subsidiary of Fimalac, S.A, or any successor thereto.
"FITCH ELIGIBLE ASSETS" means assets of the Fund set forth in the Fitch
Guidelines as eligible for inclusion in calculating the Discounted Value of the
Fund's assets in connection with Fitch ratings of VMTP Shares at the request of
the Fund.
"FITCH GUIDELINES" means the guidelines applicable to Fitch's then current
ratings of the VMTP Shares provided by Fitch in connection with Fitch's ratings
of the VMTP Shares at the request of the Fund (a copy of which
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is available to Holders on request to the Fund), in effect on the date hereof
and as may be amended from time to time, provided, however that any such
amendment will not be effective for thirty (30) days from the date that Fitch
provides final notice of such amendment to the Fund or such earlier date as the
Fund may elect.
"FITCH PROVISIONS" means Sections 7, 8(c)(B) and 9 of this Certificate of
Designation with respect to Fitch, and any other provisions hereof with respect
to Fitch's ratings of VMTP Shares at the request of the Fund, including any
provisions with respect to obtaining and maintaining a rating on VMTP Shares
from Fitch. The Fund is required to comply with the Fitch Provisions only if
Fitch is then rating VMTP Shares at the request of the Fund.
"FOREIGN ENTITY" means any non-U.S. entity that is an Operating Company
whose equity securities (or depositary receipts) are publicly traded and has a
market capitalization of a U.S. dollar equivalent of not less than
U.S.$1,000,000,000 on the trade date for the proposed transfer of VMTP Shares.
"FUND" has the meaning as set forth in the recitals of this Certificate of
Designation.
"GROSS-UP PAYMENT" means payment to a Beneficial Owner of an amount which,
when taken together with the aggregate amount of Taxable Allocations made to
such Beneficial Owner to which such Gross-up Payment relates, would cause such
Beneficial Owner's dividends in dollars (after giving effect to regular federal
income tax consequences) from the aggregate of such Taxable Allocations and the
related Gross-up Payment to be equal to the dollar amount of the dividends
which would have been received by such Beneficial Owner if the amount of such
aggregate Taxable Allocations would have been excludable from the gross income
of such Beneficial Owner. Such Gross-up Payment shall be calculated (i) without
consideration being given to the time value of money; (ii) assuming that no
Beneficial Owner of VMTP Shares is subject to the federal alternative minimum
tax with respect to dividends received from the Fund; (iii) assuming that each
Taxable Allocation and each Gross-up Payment (except to the extent such
Gross-up Payment is properly designated as an exempt-interest dividend under
Section 852(b)(5) of the Code or successor provisions) would be taxable in the
hands of each Beneficial Owner of VMTP Shares at the maximum marginal regular
federal individual income tax rate applicable to ordinary income or net capital
gains, as applicable, or the maximum marginal regular federal corporate income
tax rate applicable to ordinary income or net capital gains, as applicable,
whichever is greater, in effect at the time such Gross-up Payment is made; and
(iv) assuming that each Taxable Allocation and each Gross-up Payment would not
be subject to the tax imposed by Section 1411 of the Code or any similar
Medicare or other surtax.
"HOLDER" means a Person in whose name a VMTP Share is registered in the
registration books of the Fund maintained by the Redemption and Paying Agent.
"INCREASED RATE EVENT" means the occurrence of any of the following events:
(a) failure by the Fund to pay when due the full amount of accrued but
unpaid dividends on any Dividend Payment Date (other than a failure by the Fund
to so pay due to the lack of legally available funds under Applicable Law or
because of any other Applicable Law restrictions on such payments). This
Increased Rate Event shall be considered cured on the date the Fund pays the
full amount of such accrued but unpaid dividends;
(b) failure by the Fund to make any redemption payment pursuant to
Section 10 of this Certificate of Designation (other than a failure by the Fund
to so pay due to the lack of legally available funds under Applicable Law or
because of any other Applicable Law restrictions on such payments). This
Increased Rate Event shall be considered cured on the date the Fund makes such
redemption payment;
(c) failure by the Fund to pay when due the full amount of accrued but
unpaid dividends in respect of Gross-up Payments required to be paid pursuant
to Section 3(b), (other than a failure by the Fund to so pay due to the lack of
legally available funds under Applicable Law or because of any other Applicable
Law restrictions on such payments). This Increased Rate Event shall be
considered cured on the date the Fund pays the full amount of such accrued but
unpaid dividends in respect of Gross-up Payments required to paid pursuant to
Section 3(b);
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(d) failure by the Fund to have cured on or before the applicable Minimum
Asset Coverage Cure Date any failure to maintain Minimum Asset Coverage as
required by Section 6(a). This Increased Rate Event shall be considered cured
on the date the Fund next achieves Minimum Asset Coverage;
(e) failure by the Fund on the last day of an applicable Effective Leverage
Ratio Cure Period to have an Effective Leverage Ratio of not greater than 45%.
This Increased Rate Event shall be considered cured on the date the Fund next
has an Effective Leverage Ratio of not greater than 45%;
(f) failure by the Fund to make investments only in Eligible Assets as
required by Section 6(c). This Increased Rate Event shall be considered cured
on the date the Fund has disposed of any investments made in violation of
Section 6(c);
(g) failure by the Fund to maintain compliance with Section 6(d). This
Increased Rate Event shall be considered cured on the date the Fund returns to
compliance with Section 6(d);
(h) the creation, incurrence, or existence of any lien in violation of
Section 6(e). This Increased Rate Event shall be considered cured on the date
that such lien is released or discharged;
(i) failure by the Fund on the Basic Maintenance Cure Date to satisfy the
Basic Maintenance Amount as of the Valuation Date pertaining to such Basic
Maintenance Cure Date. This Increased Rate Event shall be considered cured on
the date that the Fund confirms in writing that it is in compliance with the
Basic Maintenance Amount and makes such confirmation publicly available, which
may be made by posting on a publicly available section of the Fund's website;
(j) the declaration, payment or setting apart for payments any dividend or
other distribution in violation of Section 8. Such Increased Rate Event shall
be considered cured (i) in the case of any declaration or setting apart for
payment of any dividend or other distribution, on the date such action is
effectively rescinded, set aside, reversed, revoked, or otherwise rendered null
and (ii) in any other case, on the first date thereafter that the Fund is not
prohibited pursuant to Section 8 from declaring, paying or setting apart for
payment a cash dividend or other cash distribution in respect of the Common
Shares;
(k) unless pursuant to an order of the court of competent jurisdiction, the
payment or distribution of any assets of the Fund in violation of Section 11(b)
or 11(c);
(l) failure of the Fund to comply with Section 13(h). This Increased Rate
Event will be considered cured on the date the Fund shall next maintain
settlement of VMTP Shares in global book entry form through the Securities
Depository;
(m) failure of the Fund to comply with Section 13(i). This Increased Rate
Event will be considered cured on the date such filing or application has been
withdrawn, rescinded or dismissed;
(n) failure of the Fund to comply with Section 13(v). This Increased Rate
Event will be considered cured on the date the Fund produces financial
statements audited in accordance with the standards of the Public Company
Accounting Oversight Board (United States);
(o) any determination is made by the Fund or the Internal Revenue Service
that the VMTP Shares are not equity in a regulated investment company for
federal income tax purposes. This Increased Rate Event will be considered cured
on the date such determination is reversed, revoked or rescinded;
(p) a Registration Rights Failure occurs. This Increased Rate Event will be
considered cured on the date such Registration Rights Failure no longer exists;
(q) failure by the Fund to have duly authorized any Related Document. This
Increased Rate Event shall be considered cured on the date the Fund duly
authorizes each such Related Document that was not previously duly authorized;
or
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<PAGE>
(r) failure by the Fund to provide the information required by Section 12(b)
and such failure is not cured by the fifth Business Day following written
request. This Increased Rate Event shall be considered cured on the date the
Fund furnishes the information specified in the foregoing sentence.
"INITIAL RATE PERIOD," with respect to the VMTP Shares of any Series, means
the period commencing on and including the Date of Original Issue thereof and
ending on, and including the next succeeding Wednesday or if such day is not a
Business Day, the next succeeding Business Day.
"INVESTMENT ADVISER", for purposes of this Certificate of Designation, means
Invesco Advisers, Inc., or any successor investment advisor to the Fund.
"LIBOR DEALER" means J.P. Morgan Securities LLC and such other dealer or
dealers as the Fund from time to time may appoint or in lieu of any thereof,
and their respective affiliates and successors.
"LIBOR RATE" means, on any Rate Determination Date, (i) the rate for
deposits in U.S. dollars for the designated Rate Period, which appears on
Reuters display page LIBOR01 ("PAGE LIBOR01") (or such other page as may
replace that page on that service, or such other service as may be selected by
the LIBOR Dealer or its successors that are LIBOR Dealers) as of 11:00 a.m.
London time, on the day that is the London Business Day preceding the Rate
Determination Date (the "LIBOR DETERMINATION DATE"), or (ii) if such rate does
not appear on Page LIBOR01 or such other page as may replace such Page LIBOR01,
(A) the LIBOR Dealer shall determine the arithmetic mean of the offered
quotations of the Reference Banks to leading banks in the London interbank
market for deposits in U.S. dollars for the designated Rate Period in an amount
determined by such LIBOR Dealer by reference to requests for quotations as of
approximately 11:00 a.m. (London time) on such date made by such LIBOR Dealer
to the Reference Banks, (B) if at least two of the Reference Banks provide such
quotations, the LIBOR Rate shall equal such arithmetic mean of such quotations,
(C) if only one or none of the Reference Banks provide such quotations, the
LIBOR Rate shall be deemed to be the arithmetic mean of the offered quotations
that leading banks in The City of New York selected by the LIBOR Dealer (after
obtaining the Fund's approval) are quoting on the relevant LIBOR Determination
Date for deposits in U.S. dollars for the designated Rate Period in an amount
determined by the LIBOR Dealer (after obtaining the Fund's approval) that is
representative of a single transaction in such market at such time by reference
to the principal London offices of leading banks in the London interbank
market; provided, however, that if one of the LIBOR Dealers does not quote a
rate required to determine the LIBOR Rate, the LIBOR Rate will be determined on
the basis of the quotation or quotations furnished by any Substitute LIBOR
Dealer or Substitute LIBOR Dealers selected by the Fund to provide such rate or
rates not being supplied by the LIBOR Dealer; provided further, that if the
LIBOR Dealer and Substitute LIBOR Dealers are required but unable to determine
a rate in accordance with at least one of the procedures provided above, the
LIBOR Rate shall be the LIBOR Rate as determined on the previous Rate
Determination Date.
"LIQUIDATION PREFERENCE," means $100,000 per share.
"LIQUIDITY ACCOUNT" has the meaning specified in Section 10(b)(ii)(A) of
this Certificate of Designation.
"LIQUIDITY ACCOUNT INITIAL DATE" means the date which is six-months prior to
the Term Redemption Date.
"LIQUIDITY ACCOUNT INVESTMENTS" means Deposit Securities or any other
security or investment owned by the Fund that is rated not less than A-/A3 or
the equivalent rating (or any such rating's future equivalent) by each NRSRO
then rating such security or investment (or if rated by only one NRSRO, by such
NRSRO) or, if no NRSRO is then rating such security, deemed to be of an
equivalent rating by the Investment Adviser on the Fund's books and records.
"LIQUIDITY REQUIREMENT" has the meaning specified in Section 10(b)(ii)(B) of
this Certificate of Designation.
"LONDON BUSINESS DAY" means any day on which commercial banks are generally
open for business in London.
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"MAJORITY" means the Holders of more than 50% of the aggregate Outstanding
amount of the VMTP Shares.
"MANAGED ASSETS" means the Fund's total assets (including any assets
attributable to money borrowed for investment purposes) minus the sum of the
Fund's accrued liabilities (other than money borrowed for investment purposes).
For the avoidance of doubt, assets attributable to money borrowed for
investment purposes includes the portion of the Fund's assets in a tender
option bond trust of which the Fund owns the residual interest (without regard
to the value of the residual interest to avoid double counting).
"MARKET VALUE" of any asset of the Fund means the indication of value
thereof determined by an independent third-party pricing service designated
pursuant to the Fund's valuation policies and procedures approved from time to
time by the Board of Trustees for use in connection with the determination of
the Fund's net asset value. The pricing service values portfolio securities at
the mean between the quoted bid and asked price or the yield equivalent when
quotations are readily available. Securities for which quotations are not
readily available are valued at fair value as determined by the pricing service
using methods which include consideration of: yields or prices of municipal
bonds of comparable quality, type of issue, coupon, maturity and rating;
indications as to value from dealers; and general market conditions. The
pricing service may employ electronic data processing techniques or a matrix
system, or both, to determine valuations.
"MAXIMUM RATE" means 15% per annum, increased by any applicable Gross-up
Payment due and payable in accordance with Section 3 of this Certificate of
Designation.
"MINIMUM ASSET COVERAGE" means asset coverage, as defined in Section 18(h)
of the 1940 Act as in effect on the Date of Original Issue (excluding from
(1) the denominator of such asset coverage test (i) any senior securities (as
defined in the 1940 Act) for which the Fund has issued a notice of redemption
and either has delivered Deposit Securities or sufficient funds (in accordance
with the terms of such senior securities) to the paying agent for such senior
securities or otherwise has adequate Deposit Securities or sufficient deposits
on hand and segregated on the books and records of the Custodian for the
purpose of such redemption and (ii) the Fund's outstanding Preferred Shares to
be redeemed with the gross proceeds from the sale of VMTP Shares or other
replacement securities, for which the Fund either has delivered Deposit
Securities or sufficient funds (in accordance with the terms of such Preferred
Shares) to the paying agent for such Preferred Shares or otherwise has adequate
Deposit Securities or sufficient deposits on hand and segregated on the books
and records of the Custodian for the purpose of such redemption and (2) from
the numerator of such asset coverage test, any Deposit Securities referred to
in the previous clause (1)(i) and (ii)) of at least 225% with respect to all
outstanding senior securities of the Fund which are shares of beneficial
interest of the Fund, including all Outstanding VMTP Shares (or, if higher,
such other asset coverage as may be specified in or under the 1940 Act as in
effect from time to time as the minimum asset coverage for senior securities
which are stock of a closed-end investment company as a condition of declaring
dividends on its common shares).
"MINIMUM ASSET COVERAGE CURE DATE," with respect to the failure by the Fund
to maintain the Minimum Asset Coverage (as required by Section 6 of this
Certificate of Designation), means the tenth Business Day following such
failure.
"MOODY'S" means Moody's Investors Service, Inc., a Delaware corporation, or
any successor thereto.
"MOODY'S DISCOUNT FACTOR" means the discount factors set forth in the
Moody's Guidelines for use in calculating the Discounted Value of the Fund's
assets in connection with Moody's ratings of VMTP Shares at the request of the
Fund.
"MOODY'S ELIGIBLE ASSETS" means assets of the Fund set forth in the Moody's
Guidelines as eligible for inclusion in calculating the Discounted Value of the
Fund's assets in connection with Moody's ratings of VMTP Shares at the request
of the Fund.
"MOODY'S GUIDELINES" means the guidelines applicable to Moody's then current
ratings of the VMTP Shares, provided by Moody's in connection with Moody's
ratings of the VMTP Shares at the request of the Fund (a
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copy of which is available to Holders on request to the Fund), in effect on the
date hereof and as may be amended from time to time, provided, however that any
such amendment will not be effective for thirty (30) days from the date that
Moody's provides final notice of such amendment to the Fund or such earlier
date as the Fund may elect.
"MOODY'S PROVISIONS" means Sections 7, 8(c)(B) and 9 of this Certificate of
Designation with respect to Moody's, and any other provisions hereof with
respect to Moody's ratings of VMTP Shares at the request of the Fund, including
any provisions with respect to obtaining and maintaining a rating on VMTP
Shares from Moody's. The Fund is required to comply with the Moody's Provisions
only if Moody's is then rating VMTP Shares at the request of the Fund.
"MUNICIPAL SECURITIES" means municipal bonds, municipal securities
(including, without limitation, municipal notes and municipal commercial paper)
or other instruments, the underlying obligations or reference obligations of
which, are one or more municipal bonds or municipal securities, in any case in
which the Fund may invest for purposes of satisfying its policy of investing in
municipal securities pursuant to its investment policies and procedures.
"NET TAX-EXEMPT INCOME" means the excess of the amount of interest
excludable from gross income under Section 103(a) of the Code over the amounts
disallowed as deductions under Sections 265 and 171(a)(2) of the Code.
"NOTICE OF REDEMPTION" means any notice with respect to the redemption of
VMTP Shares pursuant to Section 10(c) of this Certificate of Designation.
"NRSRO" means a "nationally recognized statistical rating organization"
within the meaning of Section 3(a)(62) of the Exchange Act that is not an
"affiliated person" (as defined in Section 2(a)(3) of the 1940 Act) of the
Fund, including, at the date hereof, Moody's and Fitch.
"OPERATING COMPANY" means any company that (i) is not, and does not hold
itself out as being engaged primarily in the business of investing,
reinvesting, owning, holding or trading in securities and does not own
securities having a value exceeding 50% of the value of such company's total
assets as set forth on such company's most recently publicly available
financial statement; or (ii) is a banking institution, insurance company or
broker-dealer, incorporated or organized under the laws of a country other than
the United States, or a political subdivision of a country other than the
United States that is regulated as such by that country's or subdivision's
government or any agency thereof.
"OTHER RATING AGENCY" means each NRSRO, if any, other than Fitch or Moody's
then providing a rating for the VMTP Shares at the request of the Fund.
"OTHER RATING AGENCY ELIGIBLE ASSETS" means assets of the Fund set forth in
the Other Rating Agency Guidelines as eligible for inclusion in calculating the
Discounted Value of the Fund's assets in connection with Other Rating Agency
ratings of VMTP Shares at the request of the Fund.
"OTHER RATING AGENCY GUIDELINES" means the guidelines applicable to each
Other Rating Agency's ratings of the VMTP Shares, provided by such Other Rating
Agency in connection with such Other Rating Agency's ratings of the VMTP Shares
at the request of the Fund (a copy of which is available on request to the
Fund), as may be amended from time to time, provided, however that any such
amendment will not be effective except as agreed between such Other Rating
Agency and the Fund or such earlier date as the Fund may elect.
"OTHER RATING AGENCY PROVISIONS" means Sections 7, 8(c)(B) and 9 of this
Certificate of Designation with respect to any Other Rating Agency then rating
the VMTP Shares at the request of the Fund, and any other provisions hereof
with respect to such Other Rating Agency's ratings of VMTP Shares, including
any provisions with respect to obtaining and maintaining a rating on VMTP
Shares from such Other Rating Agency. The Fund is required to comply with the
Other Rating Agency Provisions of an Other Rating Agency only if such Other
Rating Agency is then rating VMTP Shares at the request of the Fund.
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"OUTSTANDING" means, as of any date with respect to the VMTP Shares of any
Series, the number of VMTP Shares of such Series theretofore issued by the Fund
except, without duplication, (i) any VMTP Shares of such Series theretofore
cancelled or delivered to the Redemption and Paying Agent for cancellation or
redemption by the Fund, (ii) any VMTP Shares of such Series with respect to
which the Fund has given a Notice of Redemption and irrevocably deposited with
the Redemption and Paying Agent sufficient Deposit Securities to redeem such
VMTP Shares, pursuant to Section 10 of this Certificate of Designation,
(iii) any VMTP Shares of such Series as to which the Fund shall be a Beneficial
Owner, and (iv) any VMTP Shares of such Series represented by any certificate
in lieu of which a new certificate has been executed and delivered by the Fund.
"OVERCONCENTRATION AMOUNT" means as of any date of calculation of the
Effective Leverage Ratio, an amount equal to the sum of: (i) the Market Value
of the Fund's Managed Assets in a single state or territory in excess of 20%;
(ii) the Market Value of the Fund's Managed Assets in a single state or
territory rated lower than A2 by Moody's or A by S&P or Fitch in excess of 10%;
(iii) the Market Value of the Fund's Managed Assets in a single state or
territory rated lower than Baa3 by Moody's or BBB- by S&P or Fitch in excess of
5%; (iv) the Market Value of the Fund's Managed Assets that constitute tobacco
obligations (excluding tobacco obligations that are Defeased Securities and
tobacco obligations backed by state appropriation) in excess of 0%; (v) the
Market Value of the Fund's Managed Assets paying less frequently than
semi-annually in excess of 20%; and (vi) the Market Value of the Fund's Managed
Assets that constitute tobacco obligations backed by state appropriation in
excess of 5%; in each case, as a percentage of the Market Value of the Fund's
Managed Assets.
"PERMITTED ISSUER" shall have the meaning set forth in Appendix A of this
Certificate of Designation.
"PERSON" means and includes an individual, a partnership, a corporation, a
trust, an unincorporated association, a joint venture or other entity or a
government or any agency or political subdivision thereof.
"PREFERRED SHARES" has the meaning set forth in the Declaration of Trust,
and includes the VMTP Shares.
"PURCHASE AGREEMENT" means the Variable Rate Muni Term Preferred Shares
Purchase Agreement, dated as of the Closing Date, between the Fund and the
Purchaser, as amended, modified or supplemented from time to time.
"PURCHASER" means the purchaser on the Date of Original Issue as set forth
in the Purchase Agreement.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A under
the Securities Act.
"RATE DETERMINATION DATE" means, with respect to any Series of VMTP Shares,
(i) with respect to the Initial Rate Period for any Series of VMTP Shares, the
Business Day immediately preceding the Date of Original Issue of such Series
and (ii) with respect to any Subsequent Rate Period, the last day of the
immediately preceding Rate Period for such Series.
"RATE PERIOD," with respect to VMTP Shares, means the Initial Rate Period
and any Subsequent Rate Period.
"RATING AGENCY" means each of Fitch (if Fitch is then rating VMTP Shares at
the request of the Fund), Moody's (if Moody's is then rating VMTP Shares at the
request of the Fund) and any Other Rating Agency (if such Other Rating Agency
is then rating VMTP Shares at the request of the Fund).
"RATING AGENCY CERTIFICATE" has the meaning specified in Section 7(b) of
this Certificate of Designation.
"RATING AGENCY GUIDELINES" means Moody's Guidelines (if Moody's is then
rating VMTP Shares at the request of the Fund), Fitch Guidelines (if Fitch is
then rating VMTP Shares at the request of the Fund) and any Other Rating Agency
Guidelines (if such Other Rating Agency is then rating VMTP Shares at the
request of the Fund).
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"RATING AGENCY PROVISIONS" means the Moody's Provisions (if Moody's is then
rating VMTP Shares at the request of the Fund), the Fitch Provisions (if Fitch
is then rating VMTP Shares at the request of the Fund) and any Other Rating
Agency Provisions (if such Other Rating Agency is then rating VMTP Shares at
the request of the Fund). The Fund is required to comply with the Rating Agency
Provisions of a Rating Agency only if such Rating Agency is then rating VMTP
Shares at the request of the Fund.
"RATINGS SPREAD" means, with respect to any Rate Period for any Series of
VMTP Shares, the percentage per annum set forth opposite the highest applicable
credit rating assigned to such Series, unless the lowest applicable credit
rating is at or below A+/A1, in which case it means the percentage per annum
set forth opposite the lowest applicable credit rating assigned to such Series,
by either Moody's (if Moody's is then rating the VMTP Shares at the request of
the Fund), Fitch (if Fitch is then rating the VMTP Shares at the request of the
Fund) or Other Rating Agency (if Other Rating Agency is then rating the VMTP
Shares at the request of the Fund) in the table below on the Rate Determination
Date for such Rate Period:
MOODY'S/FITCH* PERCENTAGE
------------------------------------- -------------------------------------
Aaa/AAA 1.10%
Aa3/AA- to Aa1/AA+ 1.20%
A3/A- to A1/A+ 2.00%
Baa3/BBB- to Baa1/BBB+ 3.00%
Non-investment grade or NR 4.00%
* And/or the equivalent ratings of an Other Rating Agency then rating the VMTP
Shares at the request of the Fund.
"REDEMPTION AND PAYING AGENT" means Deutsche Bank Trust Company Americas or
any successor Person, which has entered into an agreement with the Fund to act
as the Fund's transfer agent, registrar, dividend disbursing agent, paying
agent, redemption price disbursing agent and calculation agent in connection
with the payment of regularly scheduled dividends with respect to each Series
of VMTP Shares, or any successor by operation of law or any successor that
acquires all or substantially all of the assets and assumes all of the
liabilities of the Redemption and Paying Agent being replaced, either directly
or by operation of law, provided that such successor (i) has a rating of at
least A3/A- from an NRSRO and (ii) is a licensed banking entity with trust
powers or a trust company and has total assets of at least $50 million.
"REDEMPTION AND PAYING AGENT AGREEMENT" means the redemption and paying
agent agreement, dated as of May 8, 2012 by and between the Fund and the
Redemption and Paying Agent pursuant to which Deutsche Bank Trust Company
Americas, or any successor, acts as Redemption and Paying Agent, as amended,
modified or supplemented from time to time.
"REDEMPTION DATE" has the meaning specified in Section 10(c) of this
Certificate of Designation.
"REDEMPTION PREMIUM" means, with respect to any VMTP Share rated above A1/A+
and its equivalent by all Rating Agencies then rating such VMTP Share at the
request of the Fund as of the relevant Redemption Date and subject to any
redemption on such Redemption Date, other than redemptions required to comply
with Minimum Asset Coverage requirements or exceed compliance with the Minimum
Asset Coverage requirements up to 240%, an amount equal to:
(A) if such Redemption Date is greater than or equal to two years from the
Term Redemption Date, the product of 3% and the Liquidation Preference of the
VMTP Shares subject to redemption;
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(B) if such Redemption Date is less than two years but greater than or equal
to 18 months from the Term Redemption Date, the product of 2% and the
Liquidation Preference of the VMTP Shares subject to redemption; and
(C) if such Redemption Date is less than 18 months but greater than or equal
to one year from the Term Redemption Date, the product of 1% and the
Liquidation Preference of the VMTP Shares subject to redemption.
Any VMTP Share exchanged for a preferred share of an acquiring entity or
successor entity in connection with a reorganization, merger or redomestication
of the Fund in another state that had been previously approved by the Holders
of VMTP Shares or that otherwise does not require the vote or consent of the
Holders of VMTP Shares shall not be subject to the Redemption Premium.
"REDEMPTION PRICE" means, with respect to any VMTP Share, the sum of (i) the
Liquidation Preference, (ii) accumulated but unpaid dividends thereon (whether
or not declared) to, but not including, the date fixed for redemption (subject
to Section 10(e)) and (iii) the Redemption Premium, if any, in respect of such
VMTP Share.
"REFERENCE BANKS" means four major banks in the London interbank market
selected by J.P. Morgan Securities LLC or its affiliates or successors or such
other party as the Fund may from time to time appoint.
"REGISTRATION RIGHTS AGREEMENT" means the registration rights agreement
entered into between the Fund and the Purchaser dated as of the Closing Date
and as amended from time to time.
"REGISTRATION RIGHTS FAILURE" means any failure by the Fund to (i) use its
commercially reasonable efforts to make effective a VMTP Registration Statement
with the SEC in violation of the Fund's obligations under the Registration
Rights Agreement, or (ii) comply in any material respect with any other
material provision of the Registration Rights Agreement necessary to effect the
VMTP Registration Statement which has not been cured within 30 Business Days of
the date of such violation.
"RELATED DOCUMENTS" means this Certificate of Designation, the Declaration
of Trust, the Purchase Agreement, the Registration Rights Agreement and the
VMTP Shares.
"RULE 2A-7" means Rule 2a-7 under the 1940 Act.
"S&P" means Standard & Poor's Ratings Services, a Standard & Poor's
Financial Services LLC business, and any successor or successors thereto
"SEC" means the Securities and Exchange Commission.
"SECURITIES ACT" means the U.S. Securities Act of 1933, as amended.
"SECURITIES DEPOSITORY" means The Depository Trust Company, New York, New
York, and any substitute for or successor to such securities depository that
shall maintain a book-entry system with respect to the VMTP Shares.
"SERIES" has the meaning as set forth in the recitals of this Certificate of
Designation.
"SERIES OF VMTP SHARES" has the meaning as set forth in the recitals of this
Certificate of Designation.
"SIFMA" has the meaning as set forth in the recitals of this Certificate of
Designation.
"SIFMA MUNICIPAL SWAP INDEX" means the Securities Industry and Financial
Markets Association Municipal Swap Index, or such other weekly, high-grade
index comprised of seven-day, tax-exempt variable rate demand notes produced by
Municipal Market Data, Inc. or its successor, or as otherwise designated by the
Securities Industry and Financial Markets Association as of 3:00 p.m., New York
City time, on the applicable Rate
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Determination Date; provided, however, that if such index is no longer produced
by Municipal Market Data, Inc. or its successor, then SIFMA Municipal Swap
Index means (i) the S&P Weekly High Grade Municipal Index produced by
Standard & Poor's Financial Services LLC or its successors on the applicable
Rate Determination Date or (ii) if the S&P Weekly High Grade Municipal Index is
no longer produced, the one-week LIBOR Rate on the applicable Rate
Determination Date.
"SUBSEQUENT RATE PERIOD," with respect to VMTP Shares, means the period
from, and including, the first day following a Rate Period of such VMTP Shares
to, and including, the next succeeding Wednesday, or if such day is not a
Business Day, the next succeeding Business Day.
"SUBSTITUTE LIBOR DEALER" means any LIBOR Dealer selected by the Fund;
provided that none of such entities shall be an existing LIBOR Dealer.
"TAXABLE ALLOCATION" means any payment or portion of a payment of a dividend
that is not designated by the Fund as an exempt-interest dividend (as defined
in Section 852(b)(5) of the Code).
"TERM REDEMPTION AMOUNT" has the meaning specified in Section 10(b)(ii)(A)
of this Certificate of Designation.
"TERM REDEMPTION DATE" means June 1, 2015 or such later date to which it may
be extended in accordance with Section 10(b)(i)(A) of this Certificate of
Designation.
"TOTAL HOLDERS" means the Holders of 100% of the aggregate Outstanding
amount of the VMTP Shares.
"U.S. GOVERNMENT SECURITIES" means direct obligations of the United States
or of its agencies or instrumentalities that are entitled to the full faith and
credit of the United States and that, except in the case of United States
Treasury Bills, provide for the periodic payment of interest and the full
payment of principal at maturity or call for redemption.
"VALUATION DATE" means each Friday that is a Business Day, or for any Friday
that is not a Business Day, the immediately preceding Business Day, and the
Date of Original Issue, commencing with the Date of Original Issue.
"VMTP REGISTRATION STATEMENT" means a registration statement prepared on
Form N-2 under the Securities Act, including the related final prospectus or
prospectuses, related to the VMTP Shares.
"VMTP SHARES" has the meaning as set forth in the recitals of this
Certificate of Designation.
"VOTING PERIOD" has the meaning specified in Section 4(b)(i) of this
Certificate of Designation.
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TERMS
1. NUMBER OF AUTHORIZED SHARES.
(a) Authorized Shares. The initial number of authorized VMTP Shares is
522.
(b) Capitalization. So long as any VMTP Shares are Outstanding, the Fund
shall not, issue (i) any class or series of shares ranking prior to or on a
parity with VMTP Shares with respect to the payment of dividends or the
distribution of assets upon dissolution, liquidation or winding up of the
affairs, or (ii) any other "senior security" (as defined in the 1940 Act as of
the Date of Original Issue) of the Fund other than the Fund's use of tender
option bonds, when-issued and delayed delivery transactions, futures, forwards,
swaps and other derivative transactions, except as may be issued in connection
with any issuance of preferred shares or other senior securities some or all of
the proceeds from which issuance are used to redeem all of the Outstanding VMTP
Shares (provided that the Fund delivers the proceeds from such issuance
necessary to redeem all of the Outstanding VMTP Shares to the Redemption and
Paying Agent for investment in Deposit Securities for the purpose of redeeming
such VMTP Shares and issues a Notice of Redemption and redeems such VMTP Shares
as soon as practicable in accordance with the terms of this Certificate of
Designation).
(c) Capital and Surplus. For so long as any VMTP Shares are outstanding,
(i) for any of the Fund's shares of beneficial interest having a par value, the
portion of any consideration received by the Fund for such shares equal to the
aggregate par value of such shares shall be deemed to be capital of the Fund,
and (ii) for any of the Fund's shares of beneficial interest having no par
value, the portion of any consideration received by the Fund for such shares
that shall be deemed to be capital of the Fund shall equal $0.01 per share
multiplied by the number of such shares issued by the Fund, unless in either or
each case the Board of Trustees by resolution determines that a greater portion
of such consideration shall be capital of the Fund. The capital of the Fund may
be increased from time to time by resolution of the Board of Trustees directing
that a portion of the net assets of the Fund in excess of the amount so
determined to be capital be transferred to the capital account. The excess, if
any, at any given time, of the net assets of the Fund over the amount
determined to be capital shall be surplus. Solely for purposes of determining
the capital and surplus of the Fund in accordance with this Section 1(c), the
Fund's net assets means the amount by which total assets of the Fund exceed its
total liabilities. Capital and surplus are not liabilities for this purpose.
(d) Reduction of Capital. The Fund may reduce its capital by a
resolution of the Board of Trustees in any of the following ways:
(i) by reducing or eliminating the capital represented by shares of
beneficial interest which have been retired;
(ii) by applying to an otherwise authorized purchase or redemption of
outstanding shares of beneficial interest some or all of the
capital represented by the shares being purchased or redeemed, or
any capital that has not been allocated to any particular class of
beneficial interest;
(iii)by applying to an otherwise authorized conversion or exchange of
its outstanding shares of beneficial interest some or all of the
capital represented by the shares being converted or exchanged, or
some or all of any capital that has not been allocated to any
particular class or series of its shares of beneficial interest, or
both, to the extent that such capital in the aggregate exceeds the
total aggregate par value or the stated capital of any previously
unissued shares issuable upon such conversion or exchange; or
(iv) by transferring to surplus (A) some or all of the capital not
represented by any particular class or series of its beneficial
interests, (B) some or all of the capital represented by its issued
shares of beneficial interests having a par value, which capital is
in excess of the aggregate par value of such shares, or (C) some of
the capital represented by issued shares of its beneficial
interests without par value.
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(e) Capital Sufficiency. Notwithstanding the other provisions of
Section (d), no reduction of capital shall be made or effected
unless the assets of the Fund remaining after such reduction shall
be sufficient to pay any debts of the Fund for which payment has
not been otherwise provided.
2. DIVIDENDS.
(a) Ranking. The shares of any Series of VMTP Shares shall rank on a
parity with each other, with shares of any other Series of VMTP Shares and with
shares of any other Series of Preferred Shares as to the payment of dividends
by the Fund.
(b) Cumulative Cash Dividends. The Holders of VMTP Shares of any Series
shall be entitled to receive, when, as and if declared by the Board of
Trustees, out of funds legally available therefor under Applicable Law and
otherwise in accordance with the Declaration of Trust and Applicable Law,
cumulative cash dividends at the Applicable Rate for such VMTP Shares,
determined as set forth in Section 2(e), and no more (except to the extent set
forth in Section 3 of this Certificate of Designation), payable on the Dividend
Payment Dates with respect to such VMTP Shares determined pursuant to
Section 2(d). Holders of VMTP Shares shall not be entitled to any dividend,
whether payable in cash, property or shares, in excess of full cumulative
dividends, as herein provided, on VMTP Shares. No interest, or sum of money in
lieu of interest, shall be payable in respect of any dividend payment or
payments on VMTP Shares which may be in arrears, and no additional sum of money
shall be payable in respect of such arrearage, except that the Fund shall pay
as a supplemental dividend out of funds legally available therefor under
Applicable Law and otherwise in accordance with Applicable Law, the Additional
Amount (as defined below in Section 2(e)(i)(B)) on account of a Failure to
Deposit, if any, in respect of each day during the period commencing on the day
a Failure to Deposit occurs through and including the day immediately preceding
the earlier of (i) the day the Failure to Deposit is cured and (ii) the third
Business Day next succeeding the day on which the Failure to Deposit occurred.
(c) Dividends Cumulative from Date of Original Issue. Dividends on VMTP
Shares of any Series shall be declared daily and accumulate at the Applicable
Rate until paid for such VMTP Shares from the Date of Original Issue thereof.
(d) Dividend Payment Dates. The Dividend Payment Date with respect to
VMTP Shares shall be the first Business Day of each calendar month.
(e)Applicable Rates and Calculation of Dividends.
(i) Applicable Rates. The dividend rate on VMTP Shares of any Series during
the period from and after the Date of Original Issue of such VMTP Shares
to and including the last day of the Initial Rate Period for such VMTP
Shares shall be calculated by the Redemption and Paying Agent and shall
equal the rate per annum set forth with respect to the shares of such
Series under "Designation" above. For each Subsequent Rate Period for
VMTP Shares thereafter, the dividend rate on such VMTP Shares shall be
calculated by the Redemption and Paying Agent and shall be equal to the
rate per annum that results from the Applicable Rate Determination for
such VMTP Shares on the Rate Determination Date immediately preceding
such Subsequent Rate Period which shall be the sum of the (1) Applicable
Base Rate and (2) Ratings Spread; provided, however, that:
(A) if an Applicable Rate Determination for any such Subsequent Rate
Period is not held (x) due to any reason not directly attributable
to fault on the part of the Fund, including, without limitation, war
damage, enemy action, terrorism, the act of any government or other
competent authority, riot, civil commotion, rebellion, storm,
tempest, accident, fire, lock-out, strike, power failure, computer
failure or error, breakdown or delay in communications or disruption
of relevant markets, the dividend rate on such VMTP Shares for the
first such Subsequent Rate Period will equal the sum of the
previously determined dividend rate and 2.00% and if the Applicable
Rate Determination for the next Subsequent Rate Period is not held
for any reason, the dividend rate on such VMTP Shares for such next
Subsequent Rate Period will be the Maximum Rate for such VMTP
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Shares and (y) for any other reason other than as provided for in
clause (x), the dividend rate on such VMTP Shares for such
Subsequent Rate Period will be adjusted to the Maximum Rate for such
VMTP Shares on the Rate Determination Date therefore;
(B) if any Failure to Deposit shall have occurred with respect to such
VMTP Shares during any Dividend Period thereof, but, prior to 12:00
noon, New York City time, on the third Business Day next succeeding
the date on which such Failure to Deposit occurred, such Failure to
Deposit shall have been cured in accordance with Section 2(f) and
the Fund shall have paid to the Redemption and Paying Agent, an
additional amount out of legally available funds therefor under
Applicable Law and otherwise in accordance with Applicable Law (the
"ADDITIONAL AMOUNT"), daily supplemental dividends equal in the
aggregate to the sum of (1) if such Failure to Deposit consisted of
the failure to timely pay to the Redemption and Paying Agent the
full amount of dividends with respect to any Dividend Period of such
VMTP Shares, an amount computed by multiplying (x) the Applicable
Rate for the Rate Period during which such Failure to Deposit occurs
on the Dividend Payment Date for such Dividend Period plus 2.00% by
(y) a fraction, the numerator of which shall be the number of days
for which such Failure to Deposit has not been cured in accordance
with Section 2(f) (including the day such Failure to Deposit occurs
and excluding the day such Failure to Deposit is cured) and the
denominator of which shall be 360, and applying the rate obtained
against the aggregate Liquidation Preference of the Outstanding
shares of such Series (with the amount for each individual day that
such Failure to Deposit occurs or continues uncured being declared
as a supplemental dividend on that day) and (2) if such Failure to
Deposit consisted of the failure to timely pay to the Redemption and
Paying Agent the Redemption Price of the shares, if any, of such
Series for which Notice of Redemption has been provided by the Fund
pursuant to Section 10(c) of this Certificate of Designation, an
amount computed by multiplying, (x) for the Rate Period during which
such Failure to Deposit occurs on the Redemption Date, the
Applicable Rate plus 2.00% by (y) a fraction, the numerator of which
shall be the number of days for which such Failure to Deposit is not
cured in accordance with Section 2(f) (including the day such
Failure to Deposit occurs and excluding the day such Failure to
Deposit is cured) and the denominator of which shall be 360, and
applying the rate obtained against the aggregate Liquidation
Preference of the Outstanding shares of such Series to be redeemed
(with the amount for each individual day that such Failure to
Deposit occurs or continues uncured being declared as a supplemental
dividend on that day), and if a Rate Determination Date occurs on
the date on which such Failure to Deposit occurred or on either of
the two Business Days succeeding that date, and the Failure to
Deposit has not been cured on such Rate Determination Date in
accordance with Section 2(f), no Applicable Rate Determination will
be held in respect of such VMTP Shares for the Subsequent Rate
Period relating to such Rate Determination Date and the dividend
rate for such VMTP Shares for such Subsequent Rate Period will be
the Maximum Rate for such VMTP Shares on the Rate Determination Date
for such Subsequent Rate Period; or
(C) Upon the occurrence of an Increased Rate Event, for each day from
(and including) the day the Increased Rate Event first occurs to
(and excluding) the day the Increased Rate Event is cured, the
dividend rate shall be a rate equal to the lesser of (x) the sum of
(I) the dividend rate otherwise determined pursuant to the
provisions of Section 2(e)(i) (exclusive of this proviso (C)) and
(II) 2.00% and (y) the Maximum Rate.
Each dividend rate determined in accordance with this Section 2(e)(i) of
this Certificate of Designation shall be an "Applicable Rate." The
Applicable Rate shall not be more than the Maximum Rate.
(ii) Calculation of Dividends. The amount of dividends per share payable on
VMTP Shares of a Series on any Dividend Payment Date shall be calculated
by the Redemption and Paying Agent and shall equal the sum of the
dividends accumulated but not yet paid for each Rate Period (or part
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thereof) in the related Dividend Period or Dividend Periods. The amount
of dividends accumulated for each such Rate Period (or part thereof)
shall be computed by multiplying the Applicable Rate in effect for VMTP
Shares of such Series for such Rate Period (or part thereof) by a
fraction, the numerator of which shall be the number of days in such
Rate Period (or part thereof) and the denominator of which shall be the
actual number of days in the year (365 or 366), and multiplying such
product by $100,000.
(f) Curing a Failure to Deposit. A Failure to Deposit with respect to
shares of a Series of VMTP Shares shall have been cured (if such Failure to
Deposit is not solely due to the willful failure of the Fund to make the
required payment to the Redemption and Paying Agent) with respect to any
Dividend Period of such VMTP Shares if, within the respective time periods
described in Section 2(e)(i), the Fund shall have paid to the Redemption and
Paying Agent (A) all accumulated but unpaid dividends on such VMTP Shares and
(B) without duplication, the Redemption Price for shares, if any, of such
Series for which Notice of Redemption has been provided by the Fund pursuant to
Section 10(c) of this Certificate of Designation; provided, however, that the
foregoing clause (B) shall not apply to the Fund's failure to pay the
Redemption Price in respect of VMTP Shares when the related Notice of
Redemption provides that redemption of such shares is subject to one or more
conditions precedent and any such condition precedent shall not have been
satisfied at the time or times and in the manner specified in such Notice of
Redemption.
(g) Dividend Payments by Fund to Redemption and Paying Agent. In
connection with each Dividend Payment Date for VMTP Shares, the Fund shall pay
to the Redemption and Paying Agent, not later than 12:00 noon, New York City
time, on the Business Day immediately preceding the Dividend Payment Date, an
aggregate amount of Deposit Securities equal to the dividends to be paid to all
Holders of VMTP Shares on such Dividend Payment Date as determined in
accordance with Section 2(e)(ii) of this Certificate of Designation or as
otherwise provided for. If an aggregate amount of funds equal to the dividends
to be paid to all Holders of VMTP Shares on such Dividend Payment Date are not
available in New York, New York, by 12:00 noon, New York City time, on the
Business Day immediately preceding such Dividend Payment Date, the Redemption
and Paying Agent will notify the Holders by Electronic Means of such fact prior
to the close of business on such day.
(h) Redemption and Paying Agent to Hold Dividend Payments by Fund in
Trust. All Deposit Securities paid to the Redemption and Paying Agent for the
payment of dividends shall be held in trust for the payment of such dividends
by the Redemption and Paying Agent for the benefit of the Holders specified in
Section 2(i). The Redemption and Paying Agent shall sell or settle any non-cash
Deposit Securities after 12:00 noon, New York City time on the Business Day
prior to a Dividend Payment Date to the extent that the Redemption and Paying
Agent has not by such time received sufficient cash to pay the full amount
dividends to be paid to all Holders of VMTP Shares on such Dividend Payment
Date and pay such cash to the Holders of VMTP Shares on a pro rata basis. In no
event shall the Redemption and Paying Agent be responsible for any losses
arising in connection with, or the sale price obtained, in connection with any
such sale or settlement of Deposit Securities. The Redemption and Paying Agent
shall notify the Fund by Electronic Means of the amount of any funds deposited
with the Redemption and Paying Agent by the Fund for any reason under the
Redemption and Paying Agent Agreement, including for the payment of dividends
or the redemption of VMTP Shares, that remain with the Redemption and Paying
Agent after ninety (90) days from the date of such deposit and such amount
shall, to the extent permitted by law, be repaid to the Fund by the Redemption
and Paying Agent upon request by Electronic Means of the Fund. The Fund's
obligation to pay dividends to Holders in accordance with the provisions of
this Certificate of Designation shall be satisfied upon payment by the
Redemption and Paying Agent of such dividends to the Securities Depository on
the relevant Dividend Payment Date.
(i) Dividends Paid to Holders. Each dividend on VMTP Shares shall be
declared daily to the Holders thereof at the close of business on each such day
and paid on each Dividend Payment Date to the Holders thereof at the close of
business on the day immediately preceding such Dividend Payment Date. In
connection with any transfer of VMTP Shares, the transferor as Beneficial Owner
of VMTP Shares shall be deemed to have agreed pursuant to the terms of the VMTP
Shares to transfer to the transferee the right to receive from the Fund any
dividends declared and unpaid for each day prior to the transferee becoming the
Beneficial Owner of the VMTP Shares in exchange for payment of the purchase
price for such VMTP Shares by the transferee. In connection with any transfer
of VMTP Shares, the transferee as Beneficial Owner of VMTP Shares shall be
deemed to have agreed pursuant to the terms of the VMTP Shares to transfer to
the transferor (or prior Holder) the right to receive from the
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Fund any dividends in the nature of Gross-up Payments that relate to dividends
paid during the transferor's (or prior Holder's) holding period.
(j) Dividends Credited Against Earliest Accumulated but Unpaid
Dividends. Any dividend payment made on VMTP Shares that is insufficient to
cover the entire amount of dividends payable shall first be credited against
the earliest accumulated but unpaid dividends due with respect to such VMTP
Shares. Dividends in arrears for any past Dividend Period may be declared and
paid at any time, without reference to any regular Dividend Payment Date, to
the Holders as their names appear on the record books of the Fund on such date,
not exceeding 15 days preceding the payment date thereof, as may be fixed by
the Board of Trustees.
(k) Dividends Designated as Exempt-Interest Dividends. Dividends on VMTP
Shares shall be designated as exempt-interest dividends up to the amount of the
Net Tax-Exempt Income of the Fund, to the extent permitted by, and for purposes
of, Section 852 of the Code.
3. GROSS-UP PAYMENTS AND NOTICE OF ALLOCATIONS. Holders of VMTP Shares shall be
entitled to receive, when, as and if declared by the Board of Trustees, out of
funds legally available therefor under Applicable Law and otherwise in
accordance with Applicable Law, dividends in an amount equal to the aggregate
Gross-up Payments as follows:
(a) Whenever the Fund intends or expects to include any net capital gains or
ordinary income taxable for regular federal income tax purposes in any dividend
on VMTP Shares, the Fund shall use its best efforts to notify the Redemption
and Paying Agent in writing of the amount to be so included (i) not later than
14 calendar days preceding the first Rate Determination Date on which the
Applicable Rate for such dividend is to be established, and (ii) for any
successive Rate Determination Date on which the Applicable Rate for such
dividend is to be established, not later than the close of business on the
immediately preceding Rate Determination Date; provided, however, that if such
information is not known before the dates specified in clauses (i) or (ii), the
Fund shall notify the Redemption and Paying Agent of such information as soon
thereafter as is commercially feasible. Whenever such advance notice is
received from the Fund, the Redemption and Paying Agent will notify each
Holder. With respect to a Rate Period for which such advance notice was given
and whose dividends are comprised partly of such ordinary income or capital
gains and partly of exempt-interest income, the different types of income will
be paid in the same relative proportions for each day during the Rate Period.
(b)(i) If the Fund allocates, under Subchapter M of Chapter 1 of the Code,
any net capital gains or ordinary income taxable for regular federal income tax
purposes to a dividend paid on VMTP Shares the Fund shall to the extent
practical simultaneously increase such dividend payment by an additional amount
equal to the Gross-up Payment and provide the Redemption and Paying Agent a
notice with respect to such dividend describing the Gross-up Payment for it to
send to the Holders and (ii) if the Fund allocates, under Subchapter M of
Chapter 1 of the Code, any net capital gains or ordinary income taxable for
regular federal income tax purposes to a dividend paid on VMTP Shares without
simultaneously increasing such dividend as described in clause (i) above the
Fund shall, prior to the end of the calendar year in which such dividend was
paid, provide the amount of the Gross-up Payments due all Holders to the
Redemption and Paying Agent and a notice with respect to such Gross-up Payment
to transmit to the Holders that were entitled to such dividend payment during
such calendar year at such Holder's address as the same appears or last
appeared on the record books of the Fund.
(c) The Fund shall, as soon as reasonably possible, make Gross-up Payments with
respect to any net capital gains or ordinary income determined by the Internal
Revenue Service to be allocable in a manner different from the manner used by
the Fund due to a clerical or similar calculation error made by the Fund,
provided that the amount of any such net capital gains or ordinary income
reallocated to the VMTP Shares exceeds $25,000 in the aggregate and such
reallocation occurs prior to the expiration of the period of limitations of the
Fund (even if such period expires prior to the expiration of the period of
limitations of any particular holder).
4. VOTING RIGHTS.
(a) One Vote Per VMTP Share. Except as otherwise provided in the
Declaration of Trust or as otherwise required by law, (i) each Holder of VMTP
Shares shall be entitled to one vote for each VMTP Share held by such Holder on
each matter submitted to a vote of shareholders of the Fund, and (ii) the
holders of outstanding
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Preferred Shares, including each VMTP Share, and of Common Shares shall vote
together as a single class; provided, however, that the holders of outstanding
Preferred Shares, including VMTP Shares, voting together as a class, to the
exclusion of the holders of all other securities and classes of shares of
beneficial interest of the Fund, shall be entitled to elect two trustees of the
Fund at all times, each Preferred Share, including each VMTP Share, entitling
the holder thereof to one vote. Subject to Section 4(b), the holders of
outstanding Common Shares and Preferred Shares, including VMTP Shares, voting
together as a single class, shall elect the balance of the trustees.
(b) Voting for Additional Trustees.
(i) Voting Period. During any period in which any one or more of the
conditions described in subparagraphs (A) or (B) of this
Section 4(b)(i) shall exist (such period being referred to herein as
a "VOTING PERIOD"), the number of trustees constituting the Board of
Trustees shall be automatically increased by the smallest number
that, when added to the two trustees elected exclusively by the
holders of Preferred Shares, including VMTP Shares, would constitute
a majority of the Board of Trustees as so increased by such smallest
number; and the holders of Preferred Shares, including VMTP Shares,
shall be entitled, voting together as a single class on a
one-vote-per-share basis (to the exclusion of the holders of all
other securities and classes of shares of beneficial interest of the
Fund), to elect such smallest number of additional trustees, together
with the two trustees that such holders are in any event entitled to
elect. A Voting Period shall commence:
(A) if at the close of business on any Dividend Payment Date
accumulated dividends (whether or not earned or declared) on any
outstanding Preferred Shares, including VMTP Shares, equal to at
least two full years' dividends shall be due and unpaid and
sufficient cash or specified securities shall not have been
deposited with the Redemption and Paying Agent (or other
redemption and paying agent for Preferred Shares other than VMTP
Shares, if applicable) for the payment of such accumulated
dividends; or
(B) if at any time holders of Preferred Shares are entitled under the
1940 Act to elect a majority of the trustees of the Fund.
Upon the termination of a Voting Period, the voting rights described
in this Section 4(b)(i) shall cease, subject always, however, to the
revesting of such voting rights in the holders of Preferred Shares
upon the further occurrence of any of the events described in this
Section 4(b)(i).
(ii) Notice of Special Meeting. As soon as reasonably practicable after
the accrual of any right of the holders of Preferred Shares to elect
additional trustees as described in Section 4(b)(i) of this
Section 4, the Fund may call a special meeting of such holders, such
call to be made by notice as provided in the bylaws of the Fund, such
meeting to be held not less than ten (10) nor more than sixty
(60) days after the date of mailing of such notice. If a special
meeting is not called by the Fund, it may be called by any such
holder on like notice. The record date for determining the holders
entitled to notice of and to vote at such special meeting shall be
not less than ten (10) days nor more than sixty (60) prior to the
date of such special meeting. At any such special meeting and at each
meeting of holders of Preferred Shares held during a Voting Period at
which trustees are to be elected, such holders, voting together as a
class (to the exclusion of the holders of all other securities and
classes of shares of beneficial interest of the Fund), shall be
entitled to elect the number of trustees prescribed in
Section 4(b)(i) on a one-vote-per-share basis.
(iii) Terms of Office of Existing Trustees. The terms of office of all
persons who are trustees of the Fund at the time of a special meeting
of Holders and holders of other Preferred Shares to elect trustees
shall continue, notwithstanding the election at such meeting by the
Holders and such other holders of other Preferred Shares of the
number of trustees that they are entitled to elect, and the persons
so elected by the Holders and such other holders of other Preferred
Shares, together with the two incumbent trustees elected by the
Holders and such other holders of other Preferred Shares and the
remaining incumbent trustees elected by the holders of the Common
Shares and Preferred Shares, shall constitute the duly elected
trustees of the Fund.
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(iv) Terms of Office of Certain Trustees to Terminate Upon Termination of
Voting Period. Simultaneously with the termination of a Voting
Period, the terms of office of the additional trustees elected by the
Holders and holders of other Preferred Shares pursuant to
Section 4(b)(i) shall terminate, the remaining trustees shall
constitute the trustees of the Fund and the voting rights of the
Holders and such other holders to elect additional trustees pursuant
to Section 4(b)(i) shall cease, subject to the provisions of the last
sentence of Section 4(b)(i).
(c) 1940 Act Matters. The affirmative vote of the holders of a "majority
of the outstanding Preferred Shares," including the VMTP Shares Outstanding at
the time, voting as a separate class, shall be required to approve (A) any
conversion of the Fund from a closed-end to an open-end investment company,
(B) any plan of reorganization (as such term is used in the 1940 Act) adversely
affecting such shares and (C) any action requiring a vote of security holders
of the Fund under Section 13(a) of the 1940 Act.
For purposes of the foregoing, "majority of the outstanding Preferred
Shares" means (i) 67% or more of such shares present at a meeting, if the
Holders of more than 50% of such shares are present or represented by proxy, or
(ii) more than 50% of such shares, whichever is less. In the event a vote of
Holders of VMTP Shares is required pursuant to the provisions of Section 13(a)
of the 1940 Act, the Fund shall, not later than 10 Business Days prior to the
date on which such vote is to be taken, notify Moody's (if Moody's is then
rating the VMTP Shares at the request of the Fund), Fitch (if Fitch is then
rating the VMTP Shares at the request of the Fund) and Other Rating Agency (if
any Other Rating Agency is then rating the VMTP Shares at the request of the
Fund) that such vote is to be taken and the nature of the action with respect
to which such vote is to be taken.
(d) Exclusive Right to Vote on Certain Matters Notwithstanding the
foregoing, and except as otherwise required by the Declaration of Trust or
Applicable Law, (i) Holders of Outstanding VMTP Shares will be entitled as a
Series, to the exclusion of the holders of all other securities, including
other Preferred Shares, Common Shares and other classes of shares of beneficial
interest of the Fund, to vote on matters adversely affecting VMTP Shares that
do not adversely affect any of the rights of holders of such other securities,
including other Preferred Shares, Common Shares and other classes of shares of
beneficial interest of the Fund and (ii) Holders of Outstanding VMTP Shares
will not be entitled to vote on matters adversely affecting any other Preferred
Shares, Common Shares and other classes of shares of beneficial interest of the
Fund that do not adversely affect any of the rights of Holders of the VMTP
Shares.
(e) Rights Set Forth Herein Are Sole Rights. Unless otherwise required
by law, the Holders of VMTP Shares shall not have any relative rights or
preferences or other special rights other than those specifically set forth
herein.
(f) No Preemptive Rights or Cumulative Voting. The Holders of VMTP
Shares shall have no preemptive rights or rights to cumulative voting.
(g) Voting for Trustees Sole Remedy for Fund's Failure to Pay Dividends.
In the event that the Fund fails to pay any dividends on the VMTP Shares, the
exclusive remedy of the Holders shall be the right to vote for trustees
pursuant to the provisions of this Section 4.
(h) Holders Entitled to Vote. For purposes of determining any rights of
the Holders to vote on any matter, whether such right is created by this
Certificate of Designation, by the other provisions of the Declaration of
Trust, by statute or otherwise by Applicable Law, no Holder shall be entitled
to vote any VMTP Shares and no VMTP Shares shall be deemed to be "Outstanding"
for the purpose of voting or determining the number of VMTP Shares required to
constitute a quorum if, prior to or concurrently with the time of determination
of VMTP Shares entitled to vote or VMTP Shares deemed Outstanding for quorum
purposes, as the case may be, the requisite Notice of Redemption with respect
to such VMTP Shares shall have been provided as set forth in Section 10(c) of
this Certificate of Designation and Deposit Securities in an amount equal to
the Redemption Price for the redemption of such VMTP Shares shall have been
deposited in trust with the Redemption and Paying Agent for that purpose. VMTP
Shares held (legally or beneficially) by the Fund or any affiliate of the Fund
or otherwise controlled by the Fund shall not have any voting rights or be
deemed to be Outstanding for voting or for calculating the voting percentage
required on any other matter or other purposes.
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(i) Grant of Irrevocable Proxy. To the fullest extent permitted by
Applicable Law, each Holder and Beneficial Owner may in its discretion grant an
irrevocable proxy.
5. AMENDMENTS.
(a) Except as may be otherwise expressly provided in respect of a particular
provision of this Certificate of Designation or as otherwise required by
Applicable Law, this Certificate of Designation may be amended only upon the
affirmative vote or written consent of (1) a majority of the Board of Trustees
and (2) the Holders of a majority of the Outstanding VMTP Shares.
(b) Notwithstanding Section 5(a) of this Certificate of Designation, except
as may be otherwise expressly provided by Sections 5(f), 5(g) or 5(h) of this
Certificate of Designation or as otherwise required by Applicable Law, so long
as any VMTP Shares are Outstanding, (x) the definitions of "Eligible Assets"
(including Appendix A hereto) and "Minimum Asset Coverage" and (y) Sections
1(b), 6(a), 6(b), 6(c), 6(d), paragraphs (A) through (D) of Section 10(b)(ii),
Section 13(h) and Section 13(i) of this Certificate of Designation may be
amended only upon the affirmative vote or written consent of (1) a majority of
the Board of Trustees and (2) the Holders of 66 2/3% of the Outstanding VMTP
Shares. No amendment to paragraphs (A) through (D) of Section 10(b)(ii) of this
Certificate of Designation shall be effective unless the Fund has received
written confirmation from each Rating Agency, as applicable, then rating the
VMTP Shares at the request of the Fund, that such amendment will not adversely
affect the rating then assigned by such Rating Agency to the VMTP Shares.
(c) Notwithstanding Sections 5(a) and 5(b) of this Certificate of
Designation, except as may be otherwise expressly provided by Sections 5(f),
5(g) or 5(h) of this Certificate of Designation or as otherwise required by
Applicable Law, the provisions of this Certificate of Designation set forth
under (x) the caption "Designation" (but only with respect to any VMTP Shares
already issued and Outstanding), (y) Sections 1(a) (but only with respect to
any VMTP Shares already issued and Outstanding), 2(a), 2(b), 2(c), 2(d),
2(e)(i), 2(e)(ii), 2(k), 3(b), 8, 10(a)(i), 10(b)(i), 10(h), 11(a), 11(b) or
11(c) of this Certificate of Designation and (z) the definitions "Additional
Amount", "Applicable Base Rate", "Applicable Rate", "Dividend Payment Date",
"Dividend Period", "Effective Leverage Ratio", "Failure to Deposit", "Gross-up
Payment", "Liquidation Preference", "Maximum Rate", "Outstanding", "Rate
Determination Date", "Ratings Spread", "Redemption Premium", "Redemption
Price", "Subsequent Rate Period" or "Term Redemption Date" (i) (A) may be
amended so as to adversely affect the amount, timing, priority or taxability of
any dividend, redemption or other payment or distribution due to the Holders
and (B) the definition of "Effective Leverage Ratio" or the provisions of this
Certificate of Designation specifying the calculation thereof may be amended,
in each case, only upon the affirmative vote or written consent of (1) a
majority of the Board of Trustees and (2) the Total Holders and (ii) except as
set forth in clause (i) above, may otherwise be amended upon the affirmative
vote or written consent of (1) a majority of the Board of Trustees and (2) the
holders of 66 2/3% of the Outstanding VMTP Shares.
(d) If any action set forth above in Sections 5(a) to 5(c) would adversely
affect the rights of one or more Series (the "AFFECTED SERIES") of VMTP Shares
in a manner different from any other Series of VMTP Shares, except as may be
otherwise expressly provided as to a particular provision of this Certificate
of Designation or as otherwise required by Applicable Law, the affirmative vote
or consent of Holders of the corresponding percentage of the Affected Series
Outstanding (as set forth in Section 5(a), (b) or (c)), shall also be required.
(e) Any amendment that amends a provision of this Certificate of
Designation, the Declaration of Trust or the VMTP Shares that requires the vote
or consent of Holders of a percentage greater than a Majority shall require
such specified percentage to approve any such proposed amendment.
(f) Notwithstanding paragraphs (a) through (e) above or anything expressed
or implied to the contrary in this Certificate of Designation, but subject to
Applicable Law, a majority of the Board of Trustees may, by resolution duly
adopted, without shareholder approval, but with at least 20 Business Days prior
written notice to the Holders, amend or supplement this Certificate of
Designation (1) to the extent not adverse to any Holder, to supply any
omission, or cure, correct or supplement any ambiguous, defective or
inconsistent provision hereof; provided that if Holders of at least 66 2/3% of
the VMTP Shares Outstanding, indicate in writing that they are adversely
affected thereby not later than five (5) Business Days prior to the effective
date of any such amendment or supplement, the Fund either shall not make any
such amendment or supplement or may seek arbitration with respect
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to such matter (at the expense of the Fund), or (2) to reflect any amendments
or supplements hereto which the Board of Trustees is expressly entitled to
adopt pursuant to the terms of this Certificate of Designation without
shareholder approval, including without limitation, (i) amendments pursuant to
Section 5(g) of this Certificate of Designation, (ii) amendments the Board of
Trustees deem necessary to conform this Certificate of Designation to the
requirements of Applicable Law or the requirements of the Code,
(iii) amendments to effect or implement any plan of reorganization among the
Fund and any registered investment companies under the 1940 Act that has been
approved by the requisite vote of the Fund's shareholders or (iv) to designate
additional Series of VMTP Shares (and terms relating thereto) to the extent
permitted by this Certificate of Designation, the VMTP Shares or the
Declaration of Trust. Any arbitration commenced pursuant to clause 1 of the
immediately preceding sentence shall be conducted in New York, New York and in
accordance with the American Arbitration Association rules.
(g) Notwithstanding anything expressed or implied to the contrary in this
Certificate of Designation, the Board of Trustees may, subject to this
Section 5(g), at any time, terminate the services of a Rating Agency then
providing a rating for VMTP Shares of such Series with or without replacement,
in either case, without the approval of Holders of VMTP Shares of such Series
or other shareholders of the Fund.
(i) Notwithstanding anything herein to the contrary, the Board of
Trustees, without the approval of Holders of VMTP Shares or other
shareholders of the Fund, may terminate the services of any Rating Agency
then providing a rating for a Series of VMTP Shares and replace it with
another Rating Agency, provided that the Fund provides seven (7) days'
notice by Electronic Means to Holders of VMTP Shares of such Series prior to
terminating the services of a Rating Agency and replacing it with another
Rating Agency. In the event a Rating Agency ceases to furnish a preferred
share rating or the Fund terminates a Rating Agency with replacement in
accordance with this clause (i), the Fund shall no longer be required to
comply with the Rating Agency Provisions of the Rating Agency so terminated
and, as applicable, the Fund shall be required to thereafter comply with the
Rating Agency Provisions of each Rating Agency then providing a rating for
the VMTP Shares of such Series at the request of the Fund.
(ii)(A) Notwithstanding anything herein to the contrary, the Board of
Trustees, without the approval of Holders of VMTP Shares or other
shareholders of the Fund, may terminate the services of any Rating
Agency then providing a rating for a Series of VMTP Shares without
replacement, provided that (I) the Fund has given the Redemption and
Paying Agent, and such terminated Rating Agency and Holders of VMTP
Shares of such Series at least 45 calendar days' advance written notice
of such termination of services, (II) the Fund is in compliance with the
Rating Agency Provisions of such terminated Rating Agency at the time
the notice required in clause (I) hereof is given and at the time of the
termination of services, and (III) the VMTP Shares of such Series
continue to be rated by at least one NRSRO at and after the time of the
termination of services.
(B) On the date that the notice is given as described in the
preceding clause (A) and on the date that the services of the applicable
Rating Agency is terminated, the Fund shall provide the Redemption and
Paying Agent and such terminated Rating Agency with an officers'
certificate as to the compliance with the provisions of the preceding
clause (A), and, on such later date and thereafter, the Fund shall no
longer be required to comply with the Rating Agency Provisions of the
Rating Agency whose services were terminated.
(iii) Notwithstanding anything herein to the contrary, but subject to
this Section 5(g), the Rating Agency Guidelines, as they may be amended from
time to time by the respective Rating Agency, will be reflected in a written
document and may be amended by the respective Rating Agency without the
vote, consent or approval of the Fund, the Board of Trustees or any holder
of Preferred Shares, including any Series of VMTP Shares, or any other
shareholder of the Fund. The Board of Trustees, without the vote or consent
of any holder of Preferred Shares, including any Series of VMTP Shares, or
any other shareholder of the Fund, may from time to time take such actions
as may be reasonably required in connection with obtaining, maintaining or
changing the rating of any Rating Agency that is then rating the VMTP Shares
at the request of the Fund, and any such action will not be deemed to affect
the preferences, rights or powers of Preferred Shares, including VMTP
Shares, or the Holders thereof, provided that the Board of Trustees receives
written confirmation from such Rating Agency then rating the VMTP Shares at
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the request of the Fund (with such confirmation in no event being required
to be obtained from a particular Rating Agency with respect to definitions
or other provisions relevant only to and adopted in connection with another
Rating Agency's rating of any Series of VMTP Shares) that any such action
would not adversely affect the rating then assigned by such Rating Agency.
(h) Notwithstanding the foregoing, nothing in this Section 5 is intended in
any way to limit the ability of the Board of Trustees to, subject to Applicable
Law, amend or alter any provisions of this Certificate of Designation at any
time that there are no VMTP Shares Outstanding.
6. MINIMUM ASSET COVERAGE AND OTHER FINANCIAL REQUIREMENTS.
(a) Minimum Asset Coverage. The Fund shall maintain, as of the Valuation
Date of each week in which any VMTP Share is Outstanding, the Minimum Asset
Coverage.
(b) Effective Leverage Ratio. The Fund shall maintain an Effective
Leverage Ratio of not greater than 45% (other than solely by reason of
fluctuations in the market value of its portfolio securities). In the event
that the Fund's Effective Leverage Ratio exceeds 45% (whether by reason of
fluctuations in the market value of its portfolio securities or otherwise), the
Fund shall cause the Effective Leverage Ratio to be 45% or lower within 10
Business Days ("EFFECTIVE LEVERAGE RATIO CURE PERIOD").
(c) Eligible Assets. The Fund shall make investments only in Eligible
Assets in accordance with the Fund's investment objectives and investment
policies.
(d) Credit Quality. Under normal market conditions, the Fund shall
invest at least 80% of its total assets in Municipal Securities rated, at the
time of investment, in one of the four highest rating categories by at least
one NRSRO or, if unrated, determined to be of comparable quality by the
Investment Adviser.
(e) Liens. The Fund shall not create or incur or suffer to be incurred
or to exist any lien on any funds, accounts or other property held under the
Declaration of Trust, except as permitted by the Declaration of Trust or as
arising by operation of law and except for (i) any lien of the Custodian or any
other Person with respect to the payment of fees or repayment for advances or
otherwise, (ii) any lien arising in connection with any overdrafts incurred by
the Fund in connection with custody accounts that it maintains, (iii) any lien
that may be incurred in connection with the Fund's use of tender option bonds,
(iv) any lien arising in connection with futures, forwards, swaps and other
derivative transactions, when-issued and delayed delivery transactions,
options, caps, floors, collars, and residual floating rate obligations issued
by tender option bond trusts, including residual interest bonds or tender
option bonds, (v) any lien that may be incurred in connection with the Fund's
proposed redemption or repurchase of all of its APS in accordance with the
terms of the governing document of such APS and in accordance with
Section 13(n) of this Certificate of Designation, and (vi) any lien that may be
incurred in connection with the Fund's proposed redemption or repurchase of all
of the Outstanding VMTP Shares (provided that the Fund delivers to the
Redemption and Paying Agent sufficient Deposit Securities for the purpose of
redeeming the VMTP Shares, issues a Notice of Redemption for the VMTP Shares
and redeems such VMTP Shares in accordance with the terms of this Certificate
of Designation) as soon as practicable after the incurrence of such lien.
7. BASIC MAINTENANCE AMOUNT.
(a) So long as VMTP Shares are Outstanding, the Fund shall maintain, on
each Valuation Date, and shall verify to its satisfaction that it is
maintaining on such Valuation Date, (i) Moody's Eligible Assets having an
aggregate Discounted Value equal to or greater than the Basic Maintenance
Amount (if Moody's is then rating the VMTP Shares at the request of the Fund),
(ii) Fitch Eligible Assets having an aggregate Discounted Value equal to or
greater than the Basic Maintenance Amount (if Fitch is then rating the VMTP
Shares at the request of the Fund), and (iii) Other Rating Agency Eligible
Assets having an aggregate Discounted Value equal to or greater than the Basic
Maintenance Amount (if any Other Rating Agency is then rating the VMTP Shares
at the request of the Fund).
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(b) The Fund shall deliver to each Rating Agency which is then rating VMTP
Shares at the request of the Fund and any other party specified in the Rating
Agency Guidelines all certificates that are set forth in the respective Rating
Agency Guidelines regarding Minimum Asset Coverage, the Basic Maintenance
Amount and/or related calculations at such times and containing such
information as set forth in the respective Rating Agency Guidelines (each, a
"RATING AGENCY CERTIFICATE"). A failure by the Fund to deliver a Rating Agency
Certificate with respect to the Basic Maintenance Amount shall be deemed to be
delivery of a Rating Agency Certificate indicating the Discounted Value for all
assets of the Fund is less than the Basic Maintenance Amount, as of the
relevant Valuation Date; provided, however, that the Fund shall have the
ability to cure such failure to deliver a Rating Agency Certificate within one
day of receipt of notice from such Rating Agency that the Fund failed to
deliver such Rating Agency Certificate.
8. RESTRICTIONS ON DIVIDENDS AND OTHER DISTRIBUTIONS.
(a) Dividends on Preferred Shares Other Than VMTP Shares. Except as set
forth in the next sentence, no dividends shall be declared or paid or set apart
for payment on the shares of any class or series of shares of beneficial
interest of the Fund ranking, as to the payment of dividends, on a parity with
VMTP Shares for any period unless full cumulative dividends have been or
contemporaneously are declared and paid on the shares of each Series of VMTP
Shares through their most recent Dividend Payment Date. When dividends are not
paid in full upon the VMTP Shares through their most recent Dividend Payment
Date or upon the shares of any other class or series of shares of beneficial
interest of the Fund ranking on a parity as to the payment of dividends with
VMTP Shares through their most recent respective dividend payment dates, all
dividends declared upon VMTP Shares and any other such class or series of
shares of beneficial interest of the Fund ranking on a parity as to the payment
of dividends with VMTP Shares shall be declared pro rata so that the amount of
dividends declared per share on VMTP Shares and such other class or series of
shares of beneficial interest of the Fund shall in all cases bear to each other
the same ratio that accumulated dividends per share on the VMTP Shares and such
other class or series of beneficial interest of the Fund bear to each other
(for purposes of this sentence, the amount of dividends declared per VMTP Share
shall be based on the Applicable Rate for such VMTP Share effective during the
Dividend Periods during which dividends were not paid in full).
(b) Dividends and Other Distributions With Respect to Common Shares Under
the 1940 Act. The Board of Trustees shall not declare any dividend (except a
dividend payable in Common Shares), or declare any other distribution, upon the
Common Shares, or purchase Common Shares, unless in every such case the
Preferred Shares have, at the time of any such declaration or purchase, an
asset coverage (as defined in and determined pursuant to the 1940 Act) of at
least 200% (or such other asset coverage as may in the future be specified in
or under the 1940 Act as the minimum asset coverage for senior securities which
are shares or stock of a closed-end investment company as a condition of
declaring dividends on its Common Shares) after deducting the amount of such
dividend, distribution or purchase price, as the case may be.
(c) Other Restrictions on Dividends and Other Distributions. For so long as
any VMTP Share is Outstanding, and except as set forth in Section 8(a) and
Section 11(c) of this Certificate of Designation, (A) the Fund shall not
declare, pay or set apart for payment any dividend or other distribution (other
than a dividend or distribution paid in shares of, or in options, warrants or
rights to subscribe for or purchase, Common Shares or other shares, if any,
ranking junior to the VMTP Shares as to the payment of dividends and the
distribution of assets upon dissolution, liquidation or winding up) in respect
of the Common Shares or any other shares of the Fund ranking junior to or on a
parity with the VMTP Shares as to the payment of dividends or the distribution
of assets upon dissolution, liquidation or winding up, or call for redemption,
redeem, purchase or otherwise acquire for consideration any Common Shares or
any other such junior shares (except by conversion into or exchange for shares
of the Fund ranking junior to the VMTP Shares as to the payment of dividends
and the distribution of assets upon dissolution, liquidation or winding up), or
any such parity shares (except by conversion into or exchange for shares of the
Fund ranking junior to or on a parity with VMTP Shares as to the payment of
dividends and the distribution of assets upon dissolution, liquidation or
winding up), unless (i) full cumulative dividends on shares of each Series of
VMTP Shares through its most recently ended Dividend Period shall have been
paid or shall have been declared and sufficient funds for the payment thereof
deposited with the Redemption and Paying Agent and (ii) the Fund has redeemed
the full number of VMTP Shares required to be redeemed by any provision for
mandatory redemption pertaining thereto, and (B) the Fund shall not declare,
pay or set apart for payment any dividend or other distribution (other than a
dividend or distribution paid in shares of, or in options, warrants or rights
to subscribe for or purchase,
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Common Shares or other shares, if any, ranking junior to VMTP Shares as to the
payment of dividends and the distribution of assets upon dissolution,
liquidation or winding up) in respect of Common Shares or any other shares of
the Fund ranking junior to VMTP Shares as to the payment of dividends or the
distribution of assets upon dissolution, liquidation or winding up, or call for
redemption, redeem, purchase or otherwise acquire for consideration any Common
Shares or any other such junior shares (except by conversion into or exchange
for shares of the Fund ranking junior to VMTP Shares as to the payment of
dividends and the distribution of assets upon dissolution, liquidation or
winding up), unless immediately after such transaction the Discounted Value of
Moody's Eligible Assets (if Moody's is then rating the VMTP Shares at the
request of the Fund), Fitch Eligible Assets (if Fitch is then rating the VMTP
Shares at the request of the Fund) and Other Rating Agency Eligible Assets (if
any Other Rating Agency is then rating the VMTP Shares at the request of the
Fund) would each at least equal the Basic Maintenance Amount.
(d) Sources of Dividends. Notwithstanding anything expressed or implied
herein to the contrary, the Board of Trustees may declare and pay dividends
(including any Gross-up Payments or Additional Amounts) upon the VMTP Shares
either (i) out of the Fund's surplus, as defined in and computed in accordance
with Sections 1(c) and 1(d) hereof; or (ii) in case there shall be no such
surplus, out of its net profits for the fiscal year in which the dividend is
declared and/or the preceding fiscal year. If the capital of the Fund, computed
in accordance with Sections 1(c) and 1(d) hereof, shall have been diminished by
depreciation in the value of its property, or by losses, or otherwise, to an
amount less than the aggregate amount of the capital represented by issued and
outstanding shares of beneficial interest of all classes having a preference
upon the distribution of assets, the Board of Trustees shall not declare and
pay out of such net profits any dividends upon any shares of beneficial
interest of any class until the deficiency in the amount of capital represented
by the issued and outstanding shares of beneficial interest of all classes
having a preference upon the distribution of assets shall have been repaired.
Nothing is this Section 8(d) shall invalidate or otherwise affect a note,
debenture or other obligation of the Fund paid by it as a dividend on its
shares of beneficial interest, or any payment made thereon, if at the time such
note, debenture or obligation was delivered by the Fund, the Fund had either
surplus or net profits as provided in Sections 8(d)(i) or (ii) from which the
dividend could lawfully have been paid.
9. RATING AGENCY RESTRICTIONS. For so long as any VMTP Shares are Outstanding
and any Rating Agency is then rating the VMTP Shares at the request of the
Fund, the Fund will not engage in certain proscribed transactions set forth in
the Rating Agency Guidelines, unless it has received written confirmation from
each such Rating Agency that proscribes the applicable transaction in its
Rating Agency Guidelines that any such action would not impair the rating then
assigned by such Rating Agency to a Series of VMTP Shares.
10.REDEMPTION.
(a) Optional Redemption.
(i) Subject to the provisions of Section 10(a)(iii), (x) VMTP Shares of
any Series may be redeemed, at the option of the Fund, at any time, as
a whole or from time to time in part, out of funds legally available
therefor under Applicable Law and otherwise in accordance with
Applicable Law, at the Redemption Price or (y) if (i) the Board of
Trustees determines it is necessary to modify this Certificate of
Designation as a result of changes in the Rating Agency Guidelines to
prevent any downgrade of the VMTP Shares by a Rating Agency then
rating the VMTP Shares at the request of the Fund and the Fund
certifies in writing to the Holders that such circumstance exists,
(ii) the Holders have not approved such proposed modifications in
accordance with Section 5 of this Certificate of Designation and
(iii) at least nine months have elapsed since the Closing Date, then
the Fund shall have the right to send a Notice of Redemption and set a
Redemption Date for a redemption of all or a portion of the
Outstanding VMTP Shares within 30 days after the occurrence of the
non-approval under clause (ii) and upon such occurrence, the Fund
shall be entitled to redeem the VMTP Shares, out of funds legally
available therefor under Applicable Law and otherwise in accordance
with Applicable Law at the Redemption Price exclusive of the
Redemption Premium; provided, however, that (A) VMTP Shares may not be
redeemed in part if after such partial redemption fewer than 50 VMTP
Shares of such Series would remain Outstanding; and (B) VMTP Shares
are not redeemable by the Fund during the Initial Rate Period.
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(ii) If fewer than all of the Outstanding VMTP Shares of a Series are to
be redeemed pursuant to Section 10(a)(i), the number of VMTP Shares
of such Series to be redeemed shall be selected either pro rata from
the Holders of VMTP Shares of such Series in proportion to the number
of VMTP Shares of such Series held by such Holders or by lot or other
fair method as determined by the Fund's Board of Trustees, in
accordance with the rules and regulations of the Securities
Depository, if applicable, and Applicable Law. The Fund's Board of
Trustees will have the full power and authority to prescribe the
terms and conditions upon which VMTP Shares will be redeemed from
time to time.
(iii) The Fund may not on any date send a Notice of Redemption pursuant to
Section 10(c) in respect of a redemption contemplated to be effected
pursuant to this Section 10(a) unless on such date (A) to the extent
such redemption is not an Excluded Redemption, the Fund has available
Deposit Securities with maturity or tender dates not later than the
day preceding the applicable Redemption Date and having a Market
Value not less than the amount (including any applicable Redemption
Premium) due to Holders of VMTP Shares by reason of the redemption of
such VMTP Shares on such Redemption Date and (B) the Discounted Value
of Moody's Eligible Assets (if Moody's is then rating the VMTP Shares
at the request of the Fund), the Discounted Value of Fitch Eligible
Assets (if Fitch is then rating the VMTP Shares at the request of the
Fund) and the Discounted Value of Other Rating Agency Eligible Assets
(if any Other Rating Agency is then rating the VMTP Shares at the
request of the Fund) would at least equal the Basic Maintenance
Amount immediately subsequent to such redemption if such redemption
were to occur on such date. For purposes of determining in clause
(B) of the preceding sentence whether the Discounted Value of Moody's
Eligible Assets at least equals the Basic Maintenance Amount, the
Moody's Discount Factors applicable to Moody's Eligible Assets shall
be determined by reference to the first Exposure Period longer than
the Exposure Period then applicable to the Fund, as described in the
definition of Moody's Discount Factor herein.
(b) Term/Mandatory Redemption.
(i)(A) Term Redemption. The Fund shall redeem, out of funds legally
available therefor and otherwise in accordance with Applicable Law,
all Outstanding VMTP Shares on the Term Redemption Date at the
Redemption Price; provided, however, the Fund shall have the right,
exercisable not more than 180 days nor less than 90 days prior to the
Liquidity Account Initial Date, to request that the Total Holders
extend the term of the Term Redemption Date for an additional 364 day
period, which request may conditioned upon terms and conditions that
are different from the terms and conditions herein. Each Holder
shall, no later than 30 days after receiving such request, notify the
Fund and the Redemption and Paying Agent of its acceptance or
rejection of such request, which acceptance by any such Holder may be
a Conditional Acceptance conditioned upon terms and conditions which
are different from the terms and conditions herein or the terms and
conditions proposed by the Fund in making an extension request. If
any Holder fails to notify the Fund and the Redemption and Paying
Agent of their acceptance or rejection of the Fund's request for
extension within such 30-day period, such failure to respond shall
constitute a rejection of such request. If the Total Holders provide
a Conditional Acceptance, then the Fund shall have 30 days thereafter
to notify the Total Holders and the Redemption and Paying Agent of
its acceptance or rejection of the terms and conditions specified in
the Total Holders' Conditional Acceptance. The Fund's failure to
notify the Total Holders and the Redemption and Paying Agent within
the 30-day period will be deemed a rejection of the terms and
conditions specified in the Total Holders' Conditional Acceptance.
Each Holder may grant or deny any request for extension of the Term
Redemption Date in its sole and absolute discretion.
(B) Basic Maintenance Amount, Minimum Asset Coverage and Effective
Leverage Ratio Mandatory Redemption. The Fund also shall redeem, out
of funds legally available therefor under Applicable Law and
otherwise in accordance with Applicable Law, at the Redemption Price,
certain of the VMTP Shares, if the Fund fails to have either Moody's
27
<PAGE>
Eligible Assets (if Moody's is then rating the VMTP Shares at the
request of the Fund) with a Discounted Value, Fitch Eligible Assets
(if Fitch is then rating the VMTP Shares at the request of the Fund)
with a Discounted Value, or Other Rating Agency Eligible Assets (if
any Other Rating Agency is then rating the VMTP Shares at the request
of the Fund) with a Discounted Value greater than or equal to the
Basic Maintenance Amount, fails to maintain the Minimum Asset
Coverage in accordance with this Certificate of Designation or fails
to maintain the Effective Leverage Ratio in accordance with
Section 6(b) of this Certificate of Designation, and such failure is
not cured on or before the applicable Cure Date. If a redemption
pursuant to this Section 10(b)(i)(B) is to occur, the Fund shall
cause a Notice of Redemption to be sent to Holders in accordance with
Section 10(c) and cause to be deposited Deposit Securities or other
sufficient funds, out of funds legally available therefor under
Applicable Law and otherwise in accordance with Applicable Law, in
trust with the Redemption and Paying Agent or other applicable paying
agent, in each case in accordance with the terms of the VMTP Shares
to be redeemed. The number of VMTP Shares to be redeemed shall be
equal to the lesser of (A) the sum of (x) the minimum number of VMTP
Shares, together with all other Preferred Shares subject to
redemption, the redemption of which, if deemed to have occurred
immediately prior to the opening of business on the applicable Cure
Date, would result in the Fund's having each of Moody's Eligible
Assets (if Moody's is then rating the VMTP Shares at the request of
the Fund) with a Discounted Value, Fitch Eligible Assets (if Fitch is
then rating the VMTP Shares at the request of the Fund) with a
Discounted Value and Other Rating Agency Eligible Assets (if any
Other Rating Agency is then rating the VMTP Shares at the request of
the Fund) with a Discounted Value greater than or equal to the Basic
Maintenance Amount, maintaining the Minimum Asset Coverage or
satisfying the Effective Leverage Ratio, as the case may be, as of
the applicable Cure Date and (y) the number of additional VMTP Shares
of the Fund may elect to simultaneously redeem (provided, however,
that if there is no such minimum number of VMTP Shares and other
Preferred Shares the redemption of which would have such result, all
Preferred Shares then outstanding shall be redeemed), and (B) the
maximum number of VMTP Shares, together with all other Preferred
Shares subject to redemption, that can be redeemed out of funds
legally available therefor under Applicable Law and otherwise in
accordance with the Declaration of Trust and Applicable Law. In
determining the VMTP Shares required to be redeemed in accordance
with the foregoing, the Fund shall allocate the number required to be
redeemed to satisfy the Basic Maintenance Amount, the Minimum Asset
Coverage or the Effective Leverage Ratio, as the case may be, pro
rata, by lot or other fair method as determined by the Fund's Board
of Trustees, in accordance with the rules and regulations of the
Securities Depository, if applicable, and Applicable Law, among VMTP
Shares and other Preferred Shares (and, then, pro rata, by lot or
other fair method as determined by the Fund's Board of Trustees, in
accordance with the rules and regulations of the Securities
Depository, if applicable, and Applicable Law, among each Series of
VMTP Shares) subject to redemption. The Fund shall effect such
redemption on the date fixed by the Fund therefor, which date shall
not be earlier than 10 Business Days nor later than 60 days after the
applicable Cure Date, except that if the Fund does not have funds
legally available under Applicable Law for the redemption of all of
the required number of VMTP Shares and other Preferred Shares which
are subject to redemption or the Fund otherwise is unable as a result
of Applicable Law to effect such redemption on or prior to 60 days
after the applicable Cure Date, the Fund shall redeem those VMTP
Shares and other Preferred Shares which it was unable to redeem on
the earliest practicable date on which it is able to effect such
redemption. If fewer than all of the Outstanding VMTP Shares are to
be redeemed pursuant to this Section 10(b), the number of VMTP Shares
to be redeemed shall be redeemed pro rata, by lot or other fair
method as determined by the Fund's Board of Trustees, in accordance
with the rules and regulations of the Securities Depository, if
applicable, and Applicable Law, from the Holders of the VMTP Shares
in proportion to the number of VMTP Shares held by such Holders.
28
<PAGE>
(ii)(A) On or prior to the Liquidity Account Initial Date with respect to any
Series of VMTP Shares, the Fund shall cause the Custodian to
segregate, by means of appropriate identification on its books and
records or otherwise in accordance with the Custodian's normal
procedures, from the other assets of the Fund (a "LIQUIDITY ACCOUNT")
Liquidity Account Investments with a Market Value equal to at least
110% of the Term Redemption Amount with respect to such Series. The
"TERM REDEMPTION AMOUNT" for any Series of VMTP Shares shall be equal
to the Redemption Price to be paid on the Term Redemption Date for
such Series, based on the number of shares of such Series then
Outstanding, assuming for this purpose that the Applicable Rate for
such Series in effect at the time of the creation of the Liquidity
Account for such Series will be the 6-month LIBOR Rate as in effect
at such time of creation until the Term Redemption Date for such
Series. If, on any date after the Liquidity Account Initial Date, the
aggregate Market Value of the Liquidity Account Investments included
in the Liquidity Account for a Series of VMTP Shares as of the close
of business on any Business Day is less than 110% of the Term
Redemption Amount with respect to such Series, then the Fund shall
cause the Custodian and the Investment Adviser to segregate
additional or substitute assets of the Fund as Liquidity Account
Investments, so that the aggregate Market Value of the Liquidity
Account Investments included in the Liquidity Account for such Series
is at least equal to 110% of the Term Redemption Amount with respect
to such Series not later than the close of business on the next
succeeding Business Day. With respect to assets of the Fund
segregated as Liquidity Account Investments, the Investment Adviser,
on behalf of the Fund, shall be entitled to instruct the Custodian on
any date to release any Liquidity Account Investments from such
segregation and to substitute therefor other Liquidity Account
Investments, so long as (x) the assets of the Fund segregated as
Liquidity Account Investments at the close of business on such date
have a Market Value equal to at least 110% of the Term Redemption
Amount with respect to such Series and (y) the assets of the Fund
designated and segregated as Deposit Securities at the close of
business on such date have a Market Value equal to at least the
Liquidity Requirement (if any) determined in accordance with
paragraph (B) below with respect to such Series for such date. The
Fund shall cause the Custodian not to permit any lien, security
interest or encumbrance to be created or permitted to exist on or in
respect of any Liquidity Account Investments included in the
Liquidity Account for any Series of VMTP Shares, other than liens,
security interests or encumbrances arising by operation of law and
any lien of the Custodian with respect to the payment of its fees or
repayment for its advances. Notwithstanding anything expressed or
implied herein to the contrary, the assets of the Liquidity Account
shall continue to be assets of the Fund subject to the interests of
all creditors and shareholders of the Fund.
(B) The Market Value of the Deposit Securities held in the Liquidity
Account for a Series of VMTP Shares, from and after the 15/th/ day of
the calendar month (or if such day is not a Business Day, the next
succeeding Business Day) that is the number of months preceding the
month of the Term Redemption Date for such Series specified in the
table set forth below, shall not be less than the percentage of the
Term Redemption Amount for such Series set forth below opposite such
number of months (the "LIQUIDITY REQUIREMENT"), but in all cases
subject to the cure provisions of paragraph (C) below:
29
<PAGE>
<TABLE>
<CAPTION>
Value of Deposit Securities as
Number of Months Preceding Percentage of Term Redemption Amount
-------------------------- ------------------------------------
<S> <C>
5 20%
4 40%
3 60%
2 80%
1 100%
</TABLE>
(C) If the aggregate Market Value of the Deposit Securities included in
the Liquidity Account for a Series of VMTP Shares as of the close of
business on any Business Day is less than the Liquidity Requirement
in respect of such Series for such Business Day, then the Fund shall
cause the segregation of additional or substitute Deposit Securities
in respect of the Liquidity Account for such Series, so that the
aggregate Market Value of the Deposit Securities included in the
Liquidity Account for such Series is at least equal to the Liquidity
Requirement for such Series not later than the close of business on
the next succeeding Business Day. With respect to Deposit Securities
included in the Liquidity Account, the Investment Adviser, on behalf
of the Fund, shall be entitled to instruct the Custodian on any date
to release any Deposit Securities from the Liquidity Account and to
substitute therefor other Deposit Securities, so long as the
aggregate Market Value of the Deposit Securities included in the
Liquidity Account for such Series is at least equal to the Liquidity
Requirement for such Series not later than the close of business on
the next succeeding Business Day.
(D) The Deposit Securities included in the Liquidity Account for a Series
of VMTP Shares may be liquidated by the Fund, in its discretion, and
the proceeds applied towards payment of the Term Redemption Amount
for such Series. Upon the deposit by the Fund on the Term Redemption
Date with the Redemption and Paying Agent of the proceeds from the
liquidation of the Deposit Securities having an initial combined
Market Value sufficient to effect the redemption of the VMTP Shares
of a Series on the Term Redemption Date for such Series, the
requirement of the Fund to maintain a Liquidity Account for such
Series as contemplated by this Section 10(b)(ii) shall lapse and be
of no further force and effect.
(c) Notice of Redemption. If the Fund shall determine or be required to
redeem, in whole or in part, VMTP Shares pursuant to Section 10(a) or
Section 10(b)(i), the Fund will send a notice of redemption (the "NOTICE OF
REDEMPTION"), by Electronic Means (or by first class mail, postage prepaid, in
the case where the VMTP Shares are in physical form) to Holders thereof, or
request the Redemption and Paying Agent, on behalf of the Fund to promptly do
so by Electronic Means (or by first class mail, postage prepaid, in the case
where the VMTP Shares are in physical form) so long as the Notice of Redemption
is furnished by the Fund to the Redemption and Paying Agent in electronic
format at least five (5) Business Days prior to the date a Notice of Redemption
is required to be delivered to the Holders, unless a shorter period of time
shall be acceptable to the Redemption and Paying Agent. A Notice of Redemption
shall be sent to Holders not less than ten (10) days prior to the date fixed
for redemption in such Notice of Redemption (the "REDEMPTION DATE"), subject to
the rules and regulations of the Securities Depository, if applicable. Each
such Notice of Redemption shall state: (i) the Redemption Date; (ii) the number
of VMTP Shares to be redeemed and the Series thereof; (iii) the CUSIP number
for VMTP Shares of such Series; (iv) the Redemption Price; (v) the place or
places where the certificate(s), if any, for such shares (properly endorsed or
assigned for transfer, if the Board of Trustees requires and the Notice of
Redemption states) are to be surrendered for payment of the Redemption Price;
(vi) that dividends on the VMTP Shares to be redeemed will cease to accumulate
from and after such Redemption Date; and (vii) the provisions of this
Certificate of Designation under which such redemption is made. If fewer than
all VMTP Shares held by any Holder are to be redeemed, the Notice of Redemption
delivered to such Holder shall also specify the number of VMTP Shares to be
redeemed from such Holder. The Fund may provide in any Notice of Redemption
relating to (i) an optional redemption contemplated to be effected pursuant to
Section 10(a) of this Certificate of Designation or (ii) any redemption of VMTP
Shares not
30
<PAGE>
required to be redeemed pursuant to Section 10(b)(i) of this Certificate of
Designation in accordance with the terms stated herein that such redemption is
subject to one or more conditions precedent not otherwise expressly stated
herein and that the Fund shall not be required to effect such redemption unless
each such condition has been satisfied at the time or times and in the manner
specified in such Notice of Redemption. No defect in the Notice of Redemption
or delivery thereof shall affect the validity of redemption proceedings, except
as required by Applicable Law.
(d) No Redemption Under Certain Circumstances. Notwithstanding the
provisions of Sections 10(a) or 10(b), if any dividends on VMTP Shares of a
Series (whether or not earned or declared) are in arrears, no VMTP Shares of
such Series shall be redeemed unless all Outstanding VMTP Shares of such Series
are simultaneously redeemed, and the Fund shall not otherwise purchase or
acquire any VMTP Shares of such Series; provided, however, that the foregoing
shall not prevent the purchase or acquisition of Outstanding VMTP Shares of
such Series pursuant to the successful completion of an otherwise lawful
purchase or exchange offer made on the same terms to Holders of all Outstanding
VMTP Shares of such Series.
(e) Absence of Funds Available for Redemption. To the extent that any
redemption for which Notice of Redemption has been provided is not made by
reason of the absence of legally available funds therefor in accordance with
the Declaration of Trust and Applicable Law, such redemption shall be made as
soon as practicable to the extent such funds become available. Failure to
redeem VMTP Shares shall be deemed to exist at any time after the date
specified for redemption in a Notice of Redemption when the Fund shall have
failed, for any reason whatsoever, to deposit in trust with the Redemption and
Paying Agent the Redemption Price with respect to any shares for which such
Notice of Redemption has been sent; provided, however, that the foregoing shall
not apply in the case of the Fund's failure to deposit in trust with the
Redemption and Paying Agent the Redemption Price with respect to any shares
where (1) the Notice of Redemption relating to such redemption provided that
such redemption was subject to one or more conditions precedent and (2) any
such condition precedent shall not have been satisfied at the time or times and
in the manner specified in such Notice of Redemption. Notwithstanding the fact
that the Fund may not have redeemed VMTP Shares for which a Notice of
Redemption has been provided, dividends may be declared and paid on VMTP Shares
and shall include those VMTP Shares for which a Notice of Redemption has been
provided.
(f) Redemption and Paying Agent to Hold Redemption Payments by Fund in
Trust. All moneys paid to the Redemption and Paying Agent for payment of the
Redemption Price of VMTP Shares called for redemption shall be held in trust by
the Redemption and Paying Agent for the benefit of Holders of shares so to be
redeemed. The Fund's obligation to pay the Redemption Price of VMTP Shares
called for redemption in accordance with this Certificate of Designation shall
be satisfied upon payment of such Redemption Price by the Redemption and Paying
Agent to the Securities Depository on the relevant Redemption Date.
(g) Shares for Which Deposit Securities Have Been Deposited and Notice
of Redemption Has Been Given Are No Longer Outstanding. Provided a Notice of
Redemption has been provided pursuant to Section 10(c), the Fund shall
irrevocably (except to the extent set forth below in this Section 10(g))
deposit with the Redemption and Paying Agent, no later than 12:00 noon, New
York City time, on a Business Day not less than ten (10) Business Days
preceding the Redemption Date specified in such notice, Deposit Securities in
an aggregate amount equal to the Redemption Price to be paid on the Redemption
Date in respect of any VMTP Shares that are subject to such Notice of
Redemption. Provided a Notice of Redemption has been provided pursuant to
Section 10(c), upon the deposit with the Redemption and Paying Agent of Deposit
Securities in an amount sufficient to redeem the VMTP Shares that are the
subject of such notice, dividends on such VMTP Shares shall cease to accumulate
as of the Redemption Date and such VMTP Shares shall no longer be deemed to be
Outstanding for any purpose, and all rights of the Holders of the VMTP Shares
so called for redemption shall cease and terminate, except the right of such
Holders to receive the Redemption Price, but without any interest or other
additional amount, except as provided in Section 2(e)(i) and in Section 3 of
this Certificate of Designation. Upon surrender in accordance with the Notice
of Redemption of the certificates for any VMTP Shares so redeemed (properly
endorsed or assigned for transfer, if the Board of Trustees shall so require
and the Notice of Redemption shall so state), the Redemption Price shall be
paid by the Redemption and Paying Agent to the Holders of VMTP Shares subject
to redemption. In the case that fewer than all of the shares represented by any
such certificate are redeemed, a new certificate shall be issued, representing
the unredeemed shares, without cost to the Holder thereof. The Fund shall be
entitled to receive from the Redemption and Paying Agent, promptly after the
date fixed for redemption, any cash
31
<PAGE>
or other Deposit Securities deposited with the Redemption and Paying Agent in
excess of (i) the aggregate Redemption Price of the VMTP Shares called for
redemption on such date and (ii) all other amounts to which Holders of VMTP
Shares called for redemption may be entitled pursuant to this Certificate of
Designation. Any funds so deposited that are unclaimed at the end of 90 days
from such Redemption Date shall, to the extent permitted by law, be repaid to
the Fund, after which time the Holders of VMTP Shares so called for redemption
may look only to the Fund for payment of the Redemption Price and all other
amounts to which they may be entitled pursuant to this Certificate of
Designation. The Fund shall be entitled to receive, from time to time after the
date fixed for redemption, any interest on the funds so deposited.
(h) Compliance with Applicable Law. In effecting any redemption pursuant
to this Section 10, the Fund shall use its best efforts to comply with all
applicable conditions precedent to effecting such redemption under any
Applicable Law, and shall effect no redemption except in accordance with
Applicable Law.
(i) Only Whole VMTP Shares May Be Redeemed. In the case of any
redemption pursuant to this Section 10, only whole VMTP Shares shall be
redeemed.
(j) Modification of Redemption Procedures. Notwithstanding the foregoing
provisions of this Section 10 and Section 5 hereof, the Fund may, in its sole
discretion, modify the administrative procedures set forth above with respect
to notification of redemption for the VMTP Shares, provided that such
modification does not materially and adversely affect the Holders of the VMTP
Shares or cause the Fund to violate any law, rule or regulation, or shall in
any way alter the obligations of the Redemption and Paying Agent without the
Redemption and Paying Agent's prior written consent. Furthermore, if in the
sole discretion of the Board of Trustees, after consultation with counsel,
modification of the foregoing redemption provisions (x) are permissible under
the rules and regulations or interpretations of the SEC and under other
Applicable Law and (y) would not cause a material risk as to the treatment of
the VMTP Shares as equity for U.S. federal income tax purposes, the Board of
Trustees, without shareholder approval, by resolution may modify such
redemption procedures.
(k) Capital Limitations on Purchases and Redemptions. Notwithstanding
anything expressed or implied to the contrary herein, for so long as any VMTP
Shares are outstanding, the Fund shall not purchase or redeem its own shares of
beneficial interest, including without limitation the VMTP Shares, for cash or
other property when its capital is impaired or when such purchase or redemption
would cause any impairment of its capital, except that it may purchase or
redeem out of capital any of its own shares of beneficial interest, including
without limitation the VMTP Shares, which are entitled upon any distribution of
its assets, whether by dividend or in liquidation, to a preference over another
class or series of its shares of beneficial interest, or, if no shares entitled
to such a preference are outstanding, any of its own shares of beneficial
interest, if such shares will be retired upon their acquisition and the capital
of the Fund reduced in accordance with Section 1(d) hereof. Nothing in this
Section 10(k) shall invalidate or otherwise affect a note, debenture or other
obligation of the Fund given by it as consideration for its acquisition by
purchase, redemption or exchange of its shares of beneficial interest if at the
time such note, debenture or obligation was delivered by the Fund its capital
was not then impaired or did not thereby become impaired. The Fund shall not
redeem any of its shares of beneficial interest, unless their redemption is
authorized by the Board of Trustees, and then only in accordance with the
Declaration of Trust.
11.LIQUIDATION RIGHTS.
(a) Ranking. The VMTP Shares shall rank on a parity with each other,
with shares of any other Series of VMTP Shares and with shares of any other
series of Preferred Shares as to the distribution of assets upon dissolution,
liquidation or winding up of the affairs of the Fund.
(b) Distributions Upon Liquidation. Upon the dissolution, liquidation or
winding up of the affairs of the Fund, whether voluntary or involuntary, the
Holders of VMTP Shares then Outstanding shall be entitled to receive and to be
paid out of the assets of the Fund legally available for distribution to its
shareholders under the Declaration of Trust and Applicable Law and otherwise in
accordance with the Declaration of Trust and Applicable Law, before any payment
or distribution shall be made on the Common Shares or on any other class of
shares of the Fund ranking junior to the VMTP Shares upon dissolution,
liquidation or winding up, an amount equal to the Liquidation Preference with
respect to such shares plus an amount equal to all dividends thereon (whether
or not declared) accumulated but unpaid to (but not including) the date of
final distribution in same day funds, together
32
<PAGE>
with any payments required to be made pursuant to Section 3 of this Certificate
of Designation in connection with the liquidation of the Fund. After the
payment to the Holders of the VMTP Shares of the full preferential amounts
provided for in this Section 11(b), the Holders of VMTP Shares as such shall
have no right or claim to any of the remaining assets of the Fund.
(c) Pro Rata Distributions. In the event the assets of the Fund
available for distribution to the Holders of VMTP Shares upon any dissolution,
liquidation or winding up of the affairs of the Fund, whether voluntary or
involuntary, shall be insufficient to pay in full all amounts to which such
Holders are entitled pursuant to Section 11(b), no such distribution shall be
made on account of any shares of any other class or series of Preferred Shares
ranking on a parity with the VMTP Shares with respect to the distribution of
assets upon such dissolution, liquidation or winding up unless proportionate
distributive amounts shall be paid on account of the VMTP Shares, ratably, in
proportion to the full distributable amounts for which holders of all such
parity shares are respectively entitled upon such dissolution, liquidation or
winding up.
(d) Rights of Junior Shares. Subject to the rights of the holders of
shares of any series or class or classes of shares ranking on a parity with the
VMTP Shares with respect to the distribution of assets upon dissolution,
liquidation or winding up of the affairs of the Fund, after payment shall have
been made in full to the Holders of the VMTP Shares as provided in
Section 11(b), but not prior thereto, any other series or class or classes of
shares ranking junior to the VMTP Shares with respect to the distribution of
assets upon dissolution, liquidation or winding up of the affairs of the Fund
shall, subject to the respective terms and provisions (if any) applying
thereto, be entitled to receive any and all assets remaining to be paid or
distributed, and the Holders of the VMTP Shares shall not be entitled to share
therein.
(e) Certain Events Not Constituting Liquidation. Neither the sale of all
or substantially all the property or business of the Fund, nor the merger,
consolidation or reorganization of the Fund into or with any business or
statutory trust, corporation or other entity nor the merger, consolidation or
reorganization of any business or statutory trust, corporation or other entity
into or with the Fund shall be a dissolution, liquidation or winding up,
whether voluntary or involuntary, for the purposes of this Section 11.
(f) Definition of Liabilities. For the avoidance of doubt, for purposes
of Section 9.2 of the Declaration of Trust, "liabilities" of the Fund shall
include all claims and obligations, including all contingent, conditional, or
unmatured claims and obligations known to the Fund, all claims and obligations
which are known to the Fund, but for which the identity of the claimant is
unknown, and all claims and obligations that have not been made known to the
Fund or that have not arisen but, based on the facts known to the Fund, are
likely to arise or to become known to the Fund within 10 years after the date
of dissolution.
12. TRANSFERS.
(a) Unless otherwise approved in writing by the Fund, a Beneficial Owner or
Holder may sell, transfer or otherwise dispose of VMTP Shares only in whole
shares and only to persons it reasonably believes are either (i) QIBs that are
registered closed-end management investment companies the shares of which are
traded on a national securities exchange ("CLOSED-END FUNDS"), banks (and their
direct or indirect wholly-owned subsidiaries), insurance companies,
Broker-Dealers, Foreign Entities (and their direct or indirect wholly-owned
subsidiaries), companies that are included in the S&P 500 Index (and their
direct or indirect wholly-owned subsidiaries) or registered open-end management
investment companies or (ii) tender option bond trusts in which all Beneficial
Owners are QIBs that are Closed-End Funds, banks (and their direct or indirect
wholly-owned subsidiaries), insurance companies, Broker-Dealers, Foreign
Entities (and their direct or indirect wholly-owned subsidiaries), companies
that are included in the S&P 500 Index (and their direct or indirect
wholly-owned subsidiaries) or registered open-end management investment
companies, in each case, pursuant to Rule 144A of the Securities Act or another
available exemption from registration under the Securities Act, in a manner not
involving any public offering within the meaning of Section 4(2) of the
Securities Act. Any transfer in violation of the foregoing restrictions shall
be void ab initio and any transferee of VMTP Shares transferred in violation of
the foregoing restrictions shall be deemed to agree to hold all payments it
received on any such improperly transferred VMTP Shares in trust for the
benefit of the transferor of such VMTP Shares. The foregoing restrictions on
transfer shall not apply to any VMTP Shares registered under the Securities Act
pursuant to the Registration Rights Agreement or any subsequent transfer of
such VMTP Shares thereafter.
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<PAGE>
(b) If at any time the Fund is not furnishing information to the SEC
pursuant to Section 13 or 15(d) of the Exchange Act, in order to preserve the
exemption for resales and transfers under Rule 144A of the Securities Act, the
Fund shall furnish, or cause to be furnished, to Holders of VMTP Shares and
prospective purchasers of VMTP Shares, upon request, information with respect
to the Fund satisfying the requirements of subsection (d)(4) of Rule 144A of
the Securities Act.
13.MISCELLANEOUS.
(a) No Fractional Shares. No fractional VMTP Shares shall be issued.
(b) Status of VMTP Shares Redeemed, Exchanged or Otherwise Acquired by
the Fund. VMTP Shares which are redeemed, exchanged or otherwise acquired by
the Fund shall return to the status of authorized and unissued Preferred Shares
without designation as to series. Any VMTP Shares which are provisionally
delivered by the Fund to or for the account of an agent of the Fund or to or
for the account of a purchaser of the VMTP Shares, but for which final payment
is not received by the Fund as agreed, shall return to the status of authorized
and unissued VMTP Shares.
(c) Treatment of VMTP Shares as Equity. The Fund shall, and each Holder
and Beneficial Owner, by virtue of acquiring VMTP Shares, is deemed to have
agreed to, treat the VMTP Shares as equity in the Fund for U.S. federal, state,
local income and other tax purposes.
(d) Board May Resolve Ambiguities. Subject to Section 5 of this
Certificate of Designation and to the extent permitted by Applicable Law, the
Board of Trustees may interpret and give effect to the provisions of this
Certificate of Designation in good faith so as to resolve any inconsistency or
ambiguity or to remedy any formal defect. Notwithstanding anything expressed or
implied to the contrary in this Certificate of Designation, but subject to
Section 5, the Board of Trustees may amend this Certificate of Designation with
respect to any Series of VMTP Shares prior to the issuance of VMTP Shares of
such Series.
(e) Headings Not Determinative. The headings contained in this
Certificate of Designation are for convenience of reference only and shall not
affect the meaning or interpretation of this Certificate of Designation.
(f) Notices. All notices or communications, unless otherwise specified
in the By-laws of the Fund or this Certificate of Designation, shall be
sufficiently given if in writing and delivered in person, by Electronic Means
or mailed by first-class mail, postage prepaid.
(g) Redemption and Paying Agent. The Fund shall use its commercially
reasonable efforts to engage at all times a Redemption and Paying Agent to
perform the duties specified in this Certificate of Designation; provided that
the Redemption and Paying Agent Agreement shall not allow the Redemption and
Paying Agent's termination or resignation to become effective unless and until
such time as a successor has been appointed and assumed the role of Redemption
and Paying Agent.
(h) Securities Depository. The Fund shall maintain settlement of VMTP
Shares in global book entry form through the Securities Depository.
(i) Voluntary Bankruptcy. The Fund shall not file a voluntary
application for relief under federal bankruptcy law or any similar application
under state law for so long as the Fund is solvent and does not reasonably
foresee becoming insolvent.
(j) Applicable Law Restrictions and Requirements. Notwithstanding
anything expressed or implied to the contrary in this Certificate of
Designation, all dividends, redemptions and other payments by the Fund on or in
respect of the VMTP Shares shall be paid only out of funds legally available
therefor under Applicable Law and otherwise in accordance with Applicable Law.
34
<PAGE>
(k) Information to Holders. Without limitation of other provisions of
this Certificate of Designation, the Fund shall deliver, or cause to be
delivered by the Redemption and Paying Agent at the expense of the Fund, to
each Holder:
(i) as promptly as practicable after the preparation and filing thereof
with the Securities and Exchange Commission, each annual and semi-annual
report prepared with respect to the Fund, which delivery may be made by
means of the electronic availability of any such document on a public
website;
(ii) notice of any change (including being put on Credit Watch or
Watchlist), suspension or termination in or of the ratings on the VMTP
Shares by any NRSRO then rating the VMTP Shares at the request of the Fund
as promptly as practicable upon the occurrence thereof, to the extent such
information is publicly available;
(iii) notice of any failure to pay in full when due any dividend required
to be paid by Section 2 of this Certificate of Designation that remains
uncured for more than three Business Days as soon as reasonably practicable,
but in no event later than one Business Day after expiration of the grace
period;
(iv) notice of insufficient deposit to provide for a properly noticed
redemption or liquidation as soon as reasonably practicable, but in no
event, later than two Business Days after discovery of insufficient
deposits, to the extent such information is publicly available;
(v) notice of any failure to comply with (A) a provision of the Rating
Agency Guidelines when failure continues for more than five consecutive
Business Days or (B) the Minimum Asset Coverage that continues for more than
five consecutive Business Days as soon as reasonably practicable after
discovery of such failure, but in no event, later than one Business Day
after the later of (x) the expiration of the grace period or (y) the earlier
of (1) the discovery of such failure and (2) information confirming such
failure becomes publicly available;
(vi) notice of any change to any investment adviser or sub-adviser of the
Fund within two Business Days after a resignation or a notice of removal has
been received from or sent to any investment adviser or sub-adviser;
provided, however, that this clause shall not apply to personnel changes of
the investment adviser or sub-adviser, to the extent such information is
publicly available or not involving any portfolio manager listed in the
public disclosure of the Fund;
(vii) notice of any proxy solicitation as soon as reasonably practicable,
but in no event, later than five Business Days after mailing thereof by the
Fund's proxy agent;
(viii) notice one Business Day after the occurrence thereof of (A) the
failure of the Fund to pay the amount due on any senior securities or other
debt at the time outstanding, and any period of grace or cure with respect
thereto shall have expired; (B) the failure of the Fund to pay, or admitting
in writing its inability to pay, its debts generally as they become due; or
(C) the failure of the Fund to pay accumulated dividends on any additional
preferred shares of beneficial interest of the Fund ranking pari passu with
the VMTP Shares, and any period of grace or cure with respect thereto shall
have expired, in each case, to the extent such information is publicly
available;
(ix) notice of the occurrence of any Increased Rate Event and any
subsequent cure thereof as soon as reasonably practicable, but in no event,
later than five days after knowledge of senior management of the Fund
thereof; provided that the Fund shall not be required to disclose the reason
for such Increased Rate Event unless such information is otherwise publicly
available;
(x) notice of any action, suit, proceeding or investigation formally
commenced or threatened in writing against the Fund or the Investment
Adviser in any court or before any governmental authority concerning this
Certificate of Designation, the Declaration of Trust, the VMTP Shares or any
Related Document, as promptly as practicable, but in no event, later than 10
Business Days after knowledge of senior management of the Fund thereof, in
each case, to the extent such information is publicly available;
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(xi) notice not later than three Business Days after each Valuation Date
if such Valuation Date occurs on or prior to December 31, 2012, and notice
one Business Day after each Valuation Date if such Valuation Date occurs
after December 31, 2012, of the Fund's Effective Leverage Ratio, Minimum
Asset Coverage and balances in the Liquidity Account, in each case, as of
the close of business on such Valuation Date which shall include detailed
information about the Market Value of the Fund's portfolio holdings and
delivery will be made by means of posting on a publicly available section of
the Fund's website;
(xii) a report of portfolio holdings of the Fund as of the end of each
month delivered no later than 15 days after the end of each month; and
(xiii) when available, publicly available financial statements of the
Fund's most recent fiscal year-end and the auditors' report with respect
thereto, which shall present fairly, in all material respects, the financial
position of the Fund at such date and for such period, in conformity with
accounting principles generally accepted in the United States of America.
The Fund shall require the Investment Adviser to inform the Fund as soon as
reasonably practicable after the Investment Adviser's knowledge or discovery of
the occurrence of any of the items set forth in Sections 13(k)(ix) and 13(k)(x)
of this Certificate of Designation.
(l) Tax Status of the Fund. The Fund will maintain its qualification as
a "regulated investment company" within the meaning of Section 851(a) of the
Code and to qualify the dividends made with respect to the VMTP Shares as
tax-exempt dividends to the extent designated by the Fund.
(m) Maintenance of Existence. At any time the VMTP Shares are
outstanding, the Fund shall maintain its existence as a business trust or
statutory trust under the laws of the state in which it is organized or formed,
with requisite power to issue the VMTP Shares and to perform its obligations
under this Certificate of Designation and each other Related Document to which
it is a party.
(n) Use of Proceeds. The Fund shall use the gross proceeds from the sale
of VMTP Shares to the Purchaser pursuant to the Purchase Agreement to redeem
the Fund's outstanding Auction Preferred Shares ("APS") as set forth in this
Section 13(n). The Fund shall give a notice of redemption of the fund's
outstanding APS within two Business Days following the Closing Date, or, if
such date is impracticable pursuant to the governing documents of the Fund's
outstanding APS, the earliest practicable date following the Closing Date
pursuant to the governing documents of the Fund's outstanding APS, for
redemption of the APS at the earliest practicable date pursuant to the
governing documents of the Fund's outstanding APS, which date is not be greater
than 60 days from the Closing Date. If the foregoing requirements of the prior
sentence are not complied with the Fund shall redeem, out of funds legally
available therefor under Applicable Law and otherwise in accordance with
Applicable Law, the VMTP Shares as promptly as possible.
(o) Compliance with Law. At any time the VMTP Shares are outstanding,
the Fund shall comply with all laws, ordinances, orders, rules and regulations
that are applicable to it if the failure to comply could reasonably be expected
to have a material adverse effect on the Fund's ability to comply with its
obligations under this Certificate of Designation, any of the VMTP Shares, and
the other Related Documents to which it is a party.
(p) Maintenance of Approvals: Filings, Etc. At any time the VMTP Shares
are outstanding, the Fund shall at all times maintain in effect, renew and
comply with all the terms and conditions of all consents, filings, licenses,
approvals and authorizations as are required under any Applicable Law for its
performance of its obligations under this Certificate of Designation and the
other Related Documents to which it is a party, except those as to which the
failure to do so could not reasonably be expected to have a material adverse
effect on the Fund's ability to comply with its obligations under this
Certificate of Designation, the VMTP Shares, and the other Related Documents to
which it is a party.
(q) 1940 Act Registration. At any time the VMTP Shares are outstanding,
the Fund shall maintain its registration as a closed-end management investment
company under the 1940 Act.
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(r) Compliance with Eligible Assets Definition. At any time the VMTP
Shares are outstanding, the Fund shall maintain policies and procedures that it
believes are reasonably designed to ensure compliance with Section 6(c) of this
Certificate of Designation.
(s) Access to Information Relating to Compliance With Eligible Assets
Definition. The Fund shall, upon request, provide a Beneficial Owner and such
of its internal and external auditors and inspectors as a Beneficial Owner may
from time to time designate, with reasonable access to publicly available
information and records of the Fund relevant to the Fund's compliance with
Section 6(c) of this Certificate of Designation, but only for the purposes of
internal and external audit.
(t) Ratings. The VMTP Shares shall have a long-term credit rating of at
least "Aa3" from Moody's and a long-term credit rating of "AAA" from Fitch on
the Closing Date and the Fund shall use its commercially reasonable efforts to
maintain a long-term credit rating at or above "A1" from Moody's under the
Moody's Guidelines (if Moody's is then rating the VMTP Shares at the request of
the Fund), a long-term credit rating at or above "A+" from Fitch under the
Fitch Guidelines (if Fitch is then rating the VMTP Shares at the request of the
Fund) and a long-term credit rating at or above the equivalent of "A+/A1" from
Other Rating Agency under the Other Rating Agency Guidelines (if Other Rating
Agency is then rating the VMTP Shares at the request of the Fund).
(u) Purchase by Affiliates. The Fund shall not, nor shall it permit, or
cause to be permitted, the Investment Adviser, or any account or entity over
which the Fund or the Investment Adviser exercises discretionary authority or
control or any of their respective affiliates (other than by the Fund, in the
case of a redemption permitted by this Certificate of Designation, in
connection with which the VMTP Shares subject to such redemption are to be
cancelled by the Fund upon such redemption), to purchase in the aggregate more
than 25% of the Outstanding VMTP Shares without the prior written consent of a
Majority of the Holders of the VMTP Shares Outstanding, and any such purchases
shall be void ab initio. For the avoidance of doubt, any such prior written
consent shall be deemed to have been obtained with respect to any purchase of
VMTP Shares pursuant to a right of first refusal granted by a Beneficial Owner.
(v) Audits. The audits of the Fund's financial statements shall be
conducted in accordance with the standards of the Public Company Accounting
Oversight Board (United States).
(w) Personal Liability. The Declaration of Trust provides that the name
"Invesco Van Kampen Trust For Value Municipals" refers to the trustees under
the Declaration of Trust collectively as trustees, but not as individuals or
personally; and no trustee, shareholder, officer, employee or agent of the Fund
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 the Fund, but the Fund property only shall be
liable.
(x) Termination. In the event that no VMTP Shares of a Series are
Outstanding, all rights and preferences of the VMTP Shares of such Series
established and designated hereunder shall cease and terminate, and all
obligations of the Fund under this Certificate of Designation with respect to
such Series shall terminate.
(y) Actions on Other Than Business Days. Unless otherwise provided
herein, if the date for making any payment, performing any act or exercising
any right, in each case as provided for in this Certificate of Designation, is
not a Business Day, such payment shall be made, act performed or right
exercised on the next succeeding Business Day, with the same force and effect
as if made or done on the nominal date provided therefor, and, with respect to
any payment so made, no dividends, interest or other amount shall accrue for
the period between such nominal date and the date of payment.
14.GLOBAL CERTIFICATE.
At any time prior to the commencement of a Voting Period, (i) all of the
VMTP Shares Outstanding from time to time shall be represented by one or more
global certificates registered in the name of the Securities Depository or its
nominee and countersigned by the Redemption and Paying Agent and (ii) no
registration of
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transfer of VMTP Shares shall be made on the books of the Fund to any Person
other than the Securities Depository or its nominee.
The foregoing restriction on registration of transfer shall be conspicuously
noted on the face or back of the certificates of VMTP Shares in such a manner
as to comply with the requirements of Section 8-204 of the Uniform Commercial
Code as in effect in The Commonwealth of Massachusetts, or any successor
provisions.
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APPENDIX A
ELIGIBLE ASSETS
On the Date of Original Issue and at all times thereafter that the VMTP Shares
are Outstanding:
1. "Eligible Assets" are defined to consist only of assets that conform to the
following requirements as of the time of investment:
A. Debt obligations. The following debt obligations which are not in
payment default at the time of investment:
i. Debt obligations issued by a State, the District of Columbia or
political subdivision thereof, including, but not limited to,
limited obligation bonds, revenue bonds, and obligations that
satisfy the requirements of Section 142(b)(1) of the Code issued by
or on behalf of one or more States, or any public agency or
authority of any State, or political subdivision of a State.
ii. Debt obligations issued by a U.S. Territory or political
subdivision thereof, including limited obligation bonds, revenue
bonds, and obligations that satisfy the requirements of section
142(b)(1) of the Code issued by or on behalf of one or more U.S.
Territories, or any public agency or authority of any U.S.
Territory, or political subdivision of a U.S. Territory, which are
rated in one of the four highest rating categories ("investment
grade") by two or more NRSROs, or by one NRSRO if rated by only one
NRSRO, or by one NRSRO, in the case of debt obligations that are
Defeased Securities, or are determined by the Investment Adviser in
good faith application of its internal credit rating standards to
be the credit equivalent of investment grade.
iii. Debt obligations of the United States.
iv. Debt obligations issued, insured, or guaranteed by a department or
an agency of the U.S. Government, if the obligation, insurance, or
guarantee commits the full faith and credit of the United States
for the repayment of the obligation.
v. Debt obligations of the Washington Metropolitan Area Transit
Authority guaranteed by the Secretary of Transportation under
Section 9 of the National Capital Transportation Act of 1969.
vi. Debt obligations of the Federal Home Loan Banks.
vii. Debt obligations, participations or other instruments of or issued
by the Federal National Mortgage Association or the Government
National Mortgage Association.
viii.Debt obligations which are or ever have been sold by the Federal
Home Loan Mortgage Corporation pursuant to sections 305 or 306 of
the Federal Home Loan Mortgage Corporation Act.
ix. Debt obligations of any agency named in 12 U.S.C. (S) 24 (Seventh)
as eligible to issue obligations that a national bank may
underwrite, deal in, purchase and sell for the bank's own account,
including qualified Canadian government obligations.
x. Debt obligations of issuers other than those specified in
(i) through (ix) above that are rated in one of the three highest
rating categories by two or more NRSROs, or by one NRSRO if the
security has been rated by only one NRSRO and that are
"marketable." For these purposes, an obligation is "marketable" if:
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. it is registered under the Securities Act;
. it is offered and sold pursuant to Securities and Exchange
Commission Rule 144A; 17 CFR 230.144A; or
. it can be sold with reasonable promptness at a price that
corresponds reasonably to its fair value.
xi. Certificates or other securities evidencing ownership interests in
a municipal bond trust structure (generally referred to as a tender
option bond structure) that invests in (a) debt obligations of the
types described in (i) or (ii) above or (b) depository receipts
reflecting ownership interests in accounts holding debt obligations
of the types described in (i) or (ii) above which with respect to
both "a" and "b" are rated, or credit enhanced by a third party
that is rated, in one of the three highest rating categories by two
or more NRSROs, or by one NRSRO if such debt obligations or
depository receipts or third party credit enhancement providers
have been rated by only one NRSRO.
An asset shall not fail to qualify as an Eligible Asset solely by virtue of the
fact that:
. it provides for repayment of principal and interest in any form
including fixed and floating rate, zero interest, capital
appreciation, discount, leases, and payment in kind; or
. it is for long-term or short-term financing purposes.
B. Derivatives
i. Interest rate derivatives;
ii. Swaps, futures, forwards, structured notes, options and swaptions
related to Eligible Assets or on an index related to Eligible
Assets;
iii. Credit default swaps; or
iv. Common shares issued by open-end investment companies registered
under the 1940 Act, swaps, futures, forwards, structured notes,
options, swaptions, or other derivatives contracts that are
designed solely to hedge the Fund's obligations under its deferred
compensation plan, provided, that any such swap, future, forward,
structured note, option, swaption, or other derivatives contract is
not itself an equity security or a derivative based on a commodity,
and may only be settled in cash (any asset under this clause iv, a
"DEFERRED COMPENSATION HEDGE ASSET"); provided that the Deferred
Compensation Hedge Assets so acquired do not constitute more than
0.05% of the Fund's Managed Assets as of the time of investment.
C. Other Assets
i. Securities issued by other investment companies registered under
the 1940 Act (open- or closed-end funds and exchange-traded funds
(i.e., ETFs)) that invest exclusively in Eligible Assets, provided
that such investments in the aggregate do not constitute more than
5% of the Fund's Managed Assets as of the time of investment;
provided further, that notwithstanding the foregoing requirements
of this clause (i), the Fund shall be permitted, subject to
Applicable Law, to invest in securities issued by a money-market
fund that (a) is registered under the 1940 Act, (b) is affiliated
with the Investment Adviser and (c) invests exclusively in debt
obligations that are Eligible Assets so long as
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the money-market fund's holdings in any one issuer do not exceed 5%
of the money-market fund's total assets.
ii. Cash.
iii. Repurchase agreements on assets described in A above.
iv. Taxable fixed-income securities issued by an issuer described in
Section 1(A) (a "PERMITTED ISSUER") that are not in default at the
time of acquisition, acquired for the purpose of influencing
control over such Permitted Issuer or creditor group of municipal
bonds of such Permitted Issuer (a) the Fund already owns and
(b) which have deteriorated or are expected shortly to deteriorate,
with the expectation that such investment should enable the Fund to
better maximize the value of its existing investment in such
issuer, provided that the taxable fixed-income securities of such
issuer so acquired do not constitute more than 0.5% of the Fund's
Managed Assets as of the time of investment.
v. Any assets received by the Fund from a Permitted Issuer as the
result of a default by the Permitted Issuer of its obligations
under the asset or the bankruptcy or restructuring of the Permitted
Issuer; provided any assets received as a result of a default by
the Permitted Issuer shall be disposed of within five years of
receipt thereof if such assets would not otherwise qualify as
Eligible Assets but for this Section 1(C)(v).
2. At any time that VMTP Shares are outstanding, for any investment company the
securities of which are held by the Fund, the Fund will provide or make
available the following information to the Holders within 10 days after the
public quarterly release of such information and on the Date of Original
Issue (for the reporting period having ended most recently prior to the
closing):
i. the identity of the investment company and the CUSIP Number, the number
of shares owned, as of the end of the prior quarter, and the percentage
of the investment company's equity represented by the Fund's investment,
as of the end of the prior quarter;
ii.a representation that each such investment company invests solely in
"Eligible Assets," which representation may be based upon the
affirmative representation of the underlying investment company's
investment adviser; and
iii.the information contained in the most recently released financial
statements of each such underlying investment company relating to the
portfolio holdings of each such investment company.
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Sub-Item 77Q1(a)
AMENDED AND RESTATED AGREEMENT AND DECLARATION OF TRUST
OF
INVESCO VAN KAMPEN TRUST FOR VALUE MUNICIPALS
AMENDED AND RESTATED AGREEMENT AND DECLARATION OF TRUST of Invesco Van
Kampen Trust for Value Municipals is made the 15th day of May, 2012 by the
parties signatory hereto, as Trustees, and by each person who becomes a
Shareholder in accordance with the terms hereinafter set forth;
WHEREAS the Trust was formed on April 2, 2012 by its sole Trustee by the
filing of a Certificate of Trust with the office of the Secretary of State of
the State of Delaware pursuant to a Declaration of Trust, dated as of March 27,
2012 (the "Original Declaration");
WHEREAS the Trust has been formed to carry on the business of a
closed-end management investment company as defined in the 1940 Act;
WHEREAS the Trustees have agreed to manage all property coming into
their hands as trustees of a Delaware statutory trust in accordance with the
provisions of the Delaware Statutory Trust Act, as amended from time to time,
and the provisions hereinafter set forth; and
WHEREAS pursuant to the provisions of the Original Declaration, the
Board of Trustees desires to amend and restate the Original Declaration in the
manner hereinafter set forth.
NOW, THEREFORE, the Trustees hereby declare that:
(i) the Original Declaration is amended and restated in its entirety in
the manner hereinafter set forth;
(ii) they will hold all cash, securities and other assets that they may
from time to time acquire in any manner as Trustees hereunder IN TRUST to
manage and dispose of the same upon the following terms and conditions for the
benefit of the holders from time to time of Shares as hereinafter set forth; and
(iii) this Amended and Restated Agreement and Declaration of Trust and
the Bylaws shall be binding in accordance with their terms on every Trustee, by
virtue of having become a Trustee of the Trust, and on every Shareholder, by
virtue of having become a Shareholder of the Trust, pursuant to the terms of
this Agreement and the Bylaws.
ARTICLE I
NAME, DEFINITIONS, PURPOSE AND CERTIFICATE OF TRUST
Section 1.1 Name. The name of the statutory trust is Invesco Van Kampen
Trust for Value Municipals, and the Trustees may transact the Trust's affairs
in that name or any other name as the Board of Trustees may from time to time
designate. The Trust shall constitute a Delaware statutory trust in accordance
with the Delaware Act.
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Section 1.2 Offices of the Trust. The Board may at any time establish
offices of the Trust at any place or places where the Trust intends to do
business.
Section 1.3 Registered Agent and Registered Office. The name of the
registered agent of the Trust and the address of the registered office of the
Trust are as set forth in the Certificate of Trust.
Section 1.4 Definitions. Whenever used herein, unless otherwise required by
the context or specifically provided in the Governing Instrument:
(a) "Affiliated Person," "Commission," "Company," "Person," and "Principal
Underwriter" shall have the meanings given them in the 1940 Act, as
modified by or interpreted by any applicable order or orders of the
Commission or any rules or regulations adopted or interpretive
releases of the Commission thereunder;
(b) "Agreement" means this Amended and Restated Agreement and Declaration
of Trust, as it may be amended or amended, restated or supplemented,
including without limitation, supplements relating to Preferred
Shares, if any, from time to time;
(c) "Board of Trustees" or "Board" shall mean the governing body of the
Trust, that is comprised of the number of Trustees of the Trust fixed
from time to time pursuant to Article III hereof, having the powers
and duties set forth herein;
(d) "Bylaws" means the Bylaws of the Trust as amended from time to time by
the Trustees;
(e) "Certificate of Trust" shall mean the certificate of trust of the
Trust filed on April 2, 2012 with the office of the Secretary of State
of the State of Delaware as required under the Delaware Act, as such
certificate may be amended or restated from time to time;
(f) "class" or "class of Shares" refers to the division of Shares into two
or more classes as provided in Section 2.1;
(g) "Code" means the Internal Revenue Code of 1986, as amended from time
to time, and the regulations promulgated thereunder;
(h) "Covered Person" means a person who is or was a Trustee, officer,
employee or agent of the Trust, or is or was serving at the request of
the Trustees as a director, trustee, partner, officer, employee or
agent of another foreign or domestic corporation, trust, partnership,
joint venture or other enterprise;
(i) "Delaware Act" refers to the Delaware Statutory Trust Act, 12 Del. C.
(S) 3801 et seq., as such Act may be amended from time to time;
(j) "Governing Instrument" means collectively, this Agreement, the Bylaws,
and any instrument or resolution establishing preferred shares, all
amendments to this Agreement and the Bylaws, all written committee and
sub-committee charters adopted by the Trustees, and every resolution
of the Trustees or any committee or sub-committee of the Trustees that
by its terms is incorporated by reference
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into this Agreement or stated to constitute part of the Trust's
Governing Instrument, in each case as of the date of the adoption of
each such resolution or amendment or modification thereto;
(k) "Majority Shareholder Vote" means the vote of "a majority of the
outstanding voting securities" (as defined in the 1940 Act) of the
Trust with each class of Shares voting together as a single class,
except to the extent the 1940 Act or the Governing Instrument requires
the separate vote of one or more classes of Shares, in which case the
applicable proportion of such classes of Shares voting as a separate
class, as the case may be, will be required;
(l) "Majority Trustee Vote" means the vote of a majority of the Trustees
then in office;
(m) "1933 Act" means the Securities Act of 1933, as amended from time to
time, and the rules promulgated thereunder;
(n) "1940 Act" means the Investment Company Act of 1940, as amended from
time to time, and the rules promulgated thereunder;
(o) "Record Owner" means, as of any particular time, a record owner of
Shares of the Trust shown on the books of the Trust or the Trust's
transfer agent as then issued and outstanding at such time;
(p) "Registration Statement" means a registration statement of the Trust
relating to Shares filed with the Commission under the 1933 Act and/or
the 1940 Act, and all amendments to such registration statement, as in
effect from time to time. The "effective date" of a Registration
Statement shall be the date on which such Registration Statement (and
any amendments thereto) is declared effective by the Commission, or
becomes effective pursuant to the 1933 Act and/or the 1940 Act;
(q) "series" or "series of Shares" refers to the designation of Shares
into one or more series as provided in Section 2.1;
(r) "Shareholder" means, as of any particular time, an owner of Shares,
whether beneficially or of record, of the Trust;
(s) "Shares" means the transferable units of beneficial interest into
which the beneficial interest in the Trust shall be divided from time
to time and includes fractions of Shares as well as whole Shares. All
references to Shares shall be deemed to be Shares of any or all series
or classes as the context may require;
(t) "Trust" means Invesco Van Kampen Trust for Value Municipals, the
Delaware statutory trust formed under the Original Declaration, as
amended and restated by this Agreement, and by filing of the
Certificate of Trust with the office of the Secretary of State of the
State of Delaware and governed by this Agreement, as such instruments
may be further amended, restated or supplemented from time to time;
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(u) "Trust Property" means any and all property, real or personal,
tangible or intangible, which is owned or held by or for the account
of the Trust, or by the Trustees on behalf of the Trust; and
(v) "Trustees" means the natural persons who have signed this Agreement as
trustees so long as they shall continue to serve as trustees of the
Trust in accordance with the terms hereof, and all other natural
persons who may from time to time be duly appointed as Trustee in
accordance with the provisions of Section 3.4, or elected as Trustee
by the Shareholders, and reference herein to a Trustee or to the
Trustees shall refer to such natural persons in their capacity as
Trustees hereunder.
In this Agreement or in any amended, restated or supplemented Agreement,
references to this Agreement, and all expressions like "herein," "hereof," and
"hereunder," shall be deemed to refer to this Agreement as amended, restated or
supplemented. All expressions like "his," "he," and "him," shall be deemed to
include the feminine and neuter, as well as masculine, genders.
Section 1.5 Purpose. The purpose of the Trust is to conduct, operate and
carry on the business of a closed-end management investment company registered
under the 1940 Act investing primarily in securities and other financial
instruments or property, and to carry on such other business as the Trustees
may from time to time determine pursuant to their authority under this
Agreement.
ARTICLE II
SHARES OF BENEFICIAL INTEREST
Section 2.1 Shares of Beneficial Interest.
(a) The Trustees may, without Shareholder approval, authorize one or more
classes of Shares (which classes may be designated as one or more
series), with Shares of each such class or series having such par
value and such preferences, voting powers, terms of redemption, if
any, and special or relative rights or privileges (including
conversion rights, if any) as the Trustees may determine. Subject to
applicable law, the Trustees may, without Shareholder approval,
authorize the Trust to issue subscription or other rights representing
interests in Shares to existing Shareholders or other persons subject
to such terms and conditions as the Trustees may determine. The number
of Shares of each class or series authorized shall be unlimited, and,
unless otherwise provided in the Governing Instrument, the Shares so
authorized may be represented in part by fractional shares. The
Trustees may without Shareholder approval from time to time divide or
combine the Shares of any class or series into a greater or lesser
number without thereby changing the proportionate beneficial interest
in the class or series. All Shares issued hereunder, including without
limitation, Shares issued in connection with a dividend or other
distribution in Shares or a split or reverse split of shares, when
issued on the terms determined by the Trustees, shall be fully paid
and nonassessable.
(b) The Shares shall initially be designated as one class, a class of an
unlimited number of common Shares, no par value (the "Common Shares"),
having the powers, preferences, rights, qualifications, limitations
and restrictions described
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below. The Trust may also, from time to time, issue a class of an
unlimited number of preferred Shares, (the "Preferred Shares"), having
such par value, powers, preferences, rights, qualifications, limitations
and restrictions as shall be set forth in a written instrument or
resolution or resolutions adopted by the Trustees. Following the
issuance of Preferred Shares, when no Preferred Shares or series of
Preferred Shares remain outstanding, the Trustees shall adopt a
resolution eliminating such Preferred Shares or Preferred Shares of the
applicable series, subject to the right of the Trustees to issue
Preferred Shares or Preferred Shares of a series pursuant to a future
resolution or resolutions. To the extent that the Trustees authorize and
issue Preferred Shares, they are hereby authorized and empowered to
amend, restate or supplement this Agreement as they deem necessary or
appropriate, including to comply with the requirements of the 1940 Act
or requirements imposed by the rating agencies or other Persons, all
without the approval of Shareholders. Any such supplement, restatement
or amendment shall be filed as is necessary.
(c)Shareholders shall have no power to vote on any matter except matters on
which a vote of Shareholders is required by the 1940 Act or the
Governing Instrument.
(d)Subject to any Board resolution establishing and designating a class of
Shares, Shareholders shall have no preemptive or other right to
subscribe for new or additional authorized, but unissued Shares or other
securities issued by the Trust.
(e)Subject to the rights of the holders of Preferred Shares, if any,
dividends or other distributions, when, as and if declared by the Board,
shall be shared equally by the holders of Common Shares on a share for
share basis. Subject to the rights of the holders of Preferred Shares,
if any, in the event of the termination of the Trust, the holders of the
Common Shares shall be entitled to receive pro rata the net
distributable assets of the Trust.
(f)Any Trustee, officer or other agent of the Trust, and any organization
in which any such Person has an economic or other interest, may acquire,
own, hold and dispose of Shares in the Trust, whether such Shares are
authorized but unissued, or already outstanding, to the same extent as
if such Person were not a Trustee, officer or other agent of the Trust;
and the Trust may issue and sell and may purchase such Shares from any
such Person or any such organization, subject to the limitations,
restrictions or other provisions applicable to the sale or purchase of
such shares herein, the 1940 Act and other applicable law.
Section 2.2 Other Securities. The Trustees may, subject to the requirements
of the 1940 Act and the Governing Instrument, authorize and issue such other
securities of the Trust as they determine to be necessary, desirable or
appropriate, having such terms, rights, preferences, privileges, limitations
and restrictions as the Trustees see fit, including debt securities or other
senior securities. The Trustees are also authorized to take such actions and
retain such Persons as they see fit to offer and sell such securities.
Section 2.3 Personal Liability of Shareholders. No Shareholder of the Trust
shall be personally liable for the debts, liabilities, obligations and expenses
incurred by, contracted for, or otherwise existing with respect to, the Trust.
Neither the Trust nor the Trustees, nor any officer, employee, or agent of the
Trust shall have any power to bind personally any Shareholder or to
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call upon any Shareholder for the payment of any sum of money or assessment
whatsoever other than (i) such as the Shareholder may at any time personally
agree to pay by way of subscription for any Shares or otherwise, or (ii) any
indemnification payment owed to the Trust by the Shareholder pursuant to
Section 8.5. The Shareholders shall be entitled, to the fullest extent
permitted by applicable law, to the same limitation of personal liability as is
extended under the Delaware General Corporation Law to stockholders of private
corporations for profit.
Section 2.4 Derivative Actions. In addition to the requirements set forth in
Section 3816 of the Delaware Act, a Shareholder or Shareholders may bring a
derivative action on behalf of the Trust only if the following conditions are
met:
(a) The Shareholder or Shareholders must make a pre-suit demand upon the
Board of Trustees to bring the subject action unless an effort to cause the
Board of Trustees to bring such an action is not likely to succeed. For
purposes of this Section 2.4, a demand on the Board of Trustees shall be deemed
not likely to succeed and therefore excused only if a majority of the Board of
Trustees, or a majority of any committee established to consider the merits of
such action, is composed of Trustees who are not "independent trustees" (as
such term is defined in the Delaware Act);
(b) Unless a demand is not required under Section 2.4(a), Shareholders
eligible to bring such derivative action under the Delaware Act who hold at
least a majority of the outstanding Shares of the Trust shall join in the
demand for the Board of Trustees to commence such action; and
(c) Unless a demand is not required under Section 2.4(a), the Board of
Trustees must be afforded a reasonable amount of time to consider such
Shareholder request and to investigate the basis of such claim. The Board of
Trustees shall be entitled to retain counsel or other advisors in considering
the merits of the demand and shall require an undertaking by the Shareholders
making such demand to reimburse the Trust for the fees and expense of any such
counsel or other advisors and other out of pocket expenses of the Trust, in the
event that the Board of Trustees determines not to bring such action. The Trust
is hereby permitted to redeem or repurchase Shares of any Shareholder liable to
the Trust under this Section 2.4(c) at a value determined by the Board of
Trustees in accordance with the 1940 Act and other applicable law, and to set
off against and retain any distributions otherwise payable to any Shareholder
liable to the Trust under this Section 2.4(c), in payment of amounts due
hereunder.
For purposes of this Section 2.4, the Board of Trustees may designate a
committee of one Trustee to consider a Shareholder demand if necessary to
create a committee with a majority of Trustees who are "independent trustees"
(as such term in defined in the Delaware Act).
Section 2.5 Assent to Agreement. Every Shareholder, by virtue of having
purchased a Share, shall be held to have expressly assented to, and agreed to
be bound by, the terms hereof. The death, incapacity, dissolution, termination,
or bankruptcy of a Shareholder during the continuance of the Trust shall not
operate to terminate the Trust nor entitle the representative of any deceased
Shareholder to an accounting or to take any action in court or elsewhere
against the Trust or the Trustees, but only to rights of said deceased,
incapacitated, dissolved, terminated or bankrupt Shareholder under the
Governing Instrument. Ownership of Shares shall not entitle the Shareholder to
any title in or to the whole or any part of the Trust
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Property or right to call for a partition or division of the same or for an
accounting, nor shall the ownership of Shares constitute the Shareholders as
partners.
Section 2.6 Disclosure of Holding. The Shareholders or holders of other
securities of the Trust shall upon demand disclose to the Trustees in writing
such information with respect to direct or indirect ownership of Shares or
other securities of the Trust as the Trustees deem to be (i) in the best
interests of the Trust or (ii) necessary to comply with the provisions of the
Code, the 1940 Act or other applicable laws or regulations, or to comply with
the requirements of any other taxing or regulatory authority or stock exchange
on which the Shares are listed for trading.
ARTICLE III
THE TRUSTEES
Section 3.1 Management of the Trust.
(a)The Trustees shall have exclusive and absolute control over the Trust
Property and over the business of the Trust to the same extent as if the
Trustees were the sole owners of the Trust Property and business in
their own right, but with such powers of delegation as may be permitted
by this Agreement.
(b)The Trustees shall have power to conduct the business of the Trust and
carry on its operations in any and all of its branches and maintain
offices both within and without the State of Delaware, in any and all
states of the United States of America, in the District of Columbia, in
any and all commonwealths, territories, dependencies, colonies, or
possessions of the United States of America, and in any and all foreign
jurisdictions and to do all such other things and execute all such
instruments as they deem necessary, proper or desirable in order to
promote the interests of the Trust although such things are not herein
specifically mentioned.
(c)The enumeration of any specific power in this Agreement shall not be
construed as limiting the aforesaid power. The powers of the Trustees
may be exercised without order of or resort to any court or other
authority.
Section 3.2 Number of Trustees. The Board shall consist of such number of
trustees as shall be fixed from time to time by a majority of the Trustees;
provided, however, that the number of trustees shall in no event be less than
two (2) nor more than eleven (11); and provided further that the number of
trustees shall be increased automatically to such number as is required to
effectuate Section 3.4(b). The natural persons who have executed this Agreement
shall be the Trustees as of the date hereof.
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Section 3.3 Classes of Trustees; Terms of Office of Trustees.
(a)The Board of Trustees shall be divided into three classes. The number of
Trustees in each class, and the individual Trustees assigned to each class,
shall be determined by resolution of the Board of Trustees.
(b)The terms of office for each class of Trustees shall be determined as
follows:
(1)The term of office of the first class shall expire on the date of the
first annual meeting of Shareholders, or special meeting in lieu thereof
at which Trustees are elected;
(2)The term of office of the second class shall expire on the date of the
second annual meeting of Shareholders or special meeting in lieu thereof
at which Trustees are elected, following the date hereof;
(3)The term of office of the third class shall expire on the date of the
third annual meeting of Shareholders or special meeting in lieu thereof
at which Trustees are elected, following the date hereof; and
(4)Upon expiration of the term of office of each class as set forth above,
the number of Trustees in such class, as determined by the Board of
Trustees, shall be elected to succeed the Trustees whose terms of office
expire for a term expiring on the date of the third annual meeting of
Shareholders, or special meeting in lieu thereof at which Trustees are
elected, following such expiration. The term of any Trustee standing for
re-election who fails to receive sufficient votes to be elected to
office due to a lack of quorum or a failure to receive the required
Shareholder vote set forth in Section 3.4 shall continue for successive
one year terms until such Trustee is duly elected, at which time such
Trustee shall serve the remainder of the term of office for the class to
which such Trustee was originally elected.
(c)Each Trustee elected shall hold office until his or her successor shall have
been elected at a meeting of Shareholders called for the purpose of electing
Trustees and shall have qualified, except that:
(1)Any Trustee may resign as trustee or may retire by written instrument
signed by such Trustee and delivered to the other Trustees, which shall
take effect upon such delivery or upon such later date as is specified
therein;
(2)Any Trustee may be removed at any time, with or without cause, by
written instrument signed by at least 75% of the number of Trustees
prior to such removal, specifying the date when such removal shall
become effective; provided that from the date hereof through June 30,
2013, such instrument shall be signed by at least eighty percent
(80%) of the number of Trustees prior to such removal;
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(3)Any Trustee who has died, become physically or mentally incapacitated
by reason of disease or otherwise, or is otherwise unable to serve,
may be retired by written instrument signed by a majority of the
other Trustees, specifying the date of his retirement; and
(4)A Trustee shall be retired in accordance with the terms of any
retirement policy adopted by at least 75% of the Trustees and in
effect from time to time.
Section 3.4 Election, Vacancies and Appointment of Trustees.
(a)Except as set forth in Section 3.4(b), Trustees shall be elected by the
affirmative vote of a majority of the outstanding Shares of the Trust
present in person or by proxy and entitled to vote at an annual meeting
of Shareholders (or special meeting in lieu thereof at which Trustees
are elected) at which a quorum is present.
(b)At any time that Preferred Shares are issued and outstanding:
(1)Two (2) Trustees shall at all times have been elected by the holders
of Preferred Shares, voting as a separate class, or in the event of a
vacancy of a Trustee so elected, appointed by the Board for such
purpose in accordance with the terms of the Governing Instrument; and
(2)The two Trustees to be elected solely by the holders of Preferred
Shares shall be elected by the affirmative vote of a majority of the
outstanding Preferred Shares present in person or by proxy and
entitled to vote at an annual meeting of Shareholders (or special
meeting in lieu thereof at which Trustees are elected) at which a
quorum is present, voting as a separate class, and the remaining
Trustees shall be elected by the Common Shares and Preferred Shares
voting together as provided in Section 3.4(a) above.
(3)The Preferred Shareholders voting as a separate class shall elect at
least a majority of the Trustees, and the number of Trustees shall be
fixed automatically to such increased number that is the smallest
number that, when added to the two Trustees elected exclusively by
the holders of Preferred Shares, would constitute a majority of the
Board of Trustees as so increased, during any period that holders of
Preferred Shares are entitled to elect a majority of the Trustees of
the Fund pursuant to the designations and powers, preferences and
rights, and the qualifications, limitations and restrictions of the
Preferred Shares as set forth by the Trustees in accordance with this
Agreement (a "voting period"). Upon termination of a Voting Period,
the voting rights described in this subparagraph 3.4(b)(3) shall
cease and the terms of the additional Trustees elected pursuant to
this Section 3.4(b)(3) shall immediately terminate; subject always,
however, to the revesting of such voting rights upon the further
occurrence of any of the events described in this subparagraph
3.4(b)(3).
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(c)In case of the declination to serve, death, resignation, retirement or
removal of a Trustee, or a Trustee is otherwise unable to serve, or an
increase in the size of the Board, a vacancy shall occur. Whenever a
vacancy in the Board of Trustees shall occur, until such vacancy is
filled, the other Trustees shall have all the powers hereunder and the
determination of the other Trustees of such vacancy shall be conclusive.
In the case of any vacancy, the remaining Trustees may fill such vacancy
by appointing such other person as they in their discretion shall see
fit, or may leave such vacancy unfilled or may reduce the size of the
Board to not less than two (2) Trustees. A Trustee appointed to fill any
such vacancy shall serve for the remainder of the term commensurate with
the class to which the person is appointed. Such appointment shall be
evidenced by a written instrument signed by a majority of the Trustees
in office or by resolution of the Board of Trustees, duly adopted, which
shall be recorded in the minutes of a meeting of the Trustees, whereupon
the appointment shall take effect.
(d)An appointment of a Trustee may be made by the Trustees then in office
in anticipation of a vacancy to occur by reason of retirement,
resignation, or removal of a Trustee, or an increase in the size of the
Board effective at a later date, provided that said appointment shall
become effective only at the time or after the expected vacancy occurs.
(e)As soon as any Trustee appointed pursuant to this Section 3.4 or elected
by the Shareholders shall have accepted the Trust and agreed in writing
to be bound by the terms of the Agreement, the Trust estate shall vest
in the new Trustee or Trustees, together with the continuing Trustees,
without any further act or conveyance, and he shall be deemed a Trustee
hereunder.
Section 3.5 Temporary Absence of Trustee. Any Trustee may, by power of
attorney, delegate his power for a period not exceeding six months at any one
time to any other Trustee or Trustees, provided that in no case shall less than
two Trustees personally exercise the other powers hereunder except as herein
otherwise expressly provided.
Section 3.6 Effect of Death, Resignation, etc. of a Trustee. The declination
to serve, death, resignation, retirement, removal, incapacity, or inability of
the Trustees, or any one of them, shall not operate to terminate the Trust or
to revoke any existing agency created pursuant to the terms of this Agreement.
Section 3.7 Ownership of Assets of the Trust. The assets of the Trust shall
be held separate and apart from any assets now or hereafter held in any
capacity other than as Trustee hereunder by the Trustees or any successor
Trustees. Legal title in all of the assets of the Trust and the right to
conduct any business shall at all times be considered as vested in the Trust,
except that the Trustees may cause legal title to any Trust Property to be held
by or in the name of one or more of the Trustees, or in the name of any Person
as nominee.
Section 3.8 Legal Standard. The Trustees shall be subject to the same
fiduciary duties to which the directors of a Delaware corporation would be
subject if the Trust were a Delaware corporation, the Shareholders were
shareholders of such Delaware corporation and the Trustees were directors of
such Delaware corporation, and such modified duties shall replace any fiduciary
duties to which the Trustees would otherwise be subject. Without limiting the
generality of the foregoing, all actions and omissions of the Trustees shall be
evaluated under the doctrine commonly referred to as the "business judgment
rule," as defined and
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developed under Delaware law, to the same extent that the same actions or
omissions of directors of a Delaware corporation in a substantially similar
circumstance would be evaluated under such doctrine. Notwithstanding the
foregoing, the provisions of the Governing Instrument, to the extent that they
modify, restrict or eliminate the duties (including fiduciary duties), and
liabilities relating thereto, of a Trustee otherwise applicable under the
foregoing standard or otherwise existing at law (statutory or common) or in
equity, are agreed by each Shareholder and the Trust to replace such duties and
liabilities of such Trustee under the foregoing standard or otherwise existing
at law (statutory or common) or in equity.
Section 3.9 Other Business Interests. The Trustees shall devote to the
affairs of the Trust such time as may be necessary for the proper performance
of their duties hereunder, but neither the Trustees nor the officers,
directors, shareholders, partners or employees of the Trustees, if any, shall
be expected to devote their full time to the performance of such duties. The
Trustees, or any Affiliated Person, shareholder, officer, director, partner or
employee thereof, or any Person owning a legal or beneficial interest therein,
may engage in, or possess an interest in, any business or venture other than
the Trust, of any nature and description, independently or with or for the
account of others. None of the Trust or any Shareholder shall have the right to
participate or share in such other business or venture or any profit or
compensation derived therefrom.
ARTICLE IV
POWERS OF THE TRUSTEES
Section 4.1 Powers. The Trustees in all instances shall act as principals,
and are and shall be free from the control of the Shareholders. The Trustees
shall have full power and authority to do any and all acts and to make and
execute any and all contracts and instruments that they may consider necessary
or appropriate in connection with the management of the Trust.
(a) Without limiting the foregoing and subject to any applicable
limitation in the Governing Instrument or applicable law, the Trustees
shall have power and authority:
(1) To invest and reinvest cash and other property, and to hold cash or
other property uninvested, without in any event being bound or
limited by any present or future law or custom in regard to
investments by Trustees, and to sell, exchange, lend, pledge,
mortgage, hypothecate, write options on, distribute and otherwise
deal with and lease any or all of the assets of the Trust;
(2) To operate as, and to carry on the business of, an investment
company, and to exercise all the powers necessary and appropriate
to the conduct of such operations;
(3) To borrow money and in this connection issue notes or other
evidence of indebtedness; to secure borrowings by mortgaging,
pledging or otherwise subjecting as security the Trust Property; to
endorse, guarantee, or undertake the performance of an obligation
or engagement of any other Person and to lend Trust Property;
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(4) To provide for the distribution of Shares either through a
principal underwriter in the manner hereafter provided for or by
the Trust itself, or both, or otherwise pursuant to an underwriting
agreement of any kind;
(5) To adopt Bylaws not inconsistent with this Agreement providing for
the conduct of the business of the Trust and to amend and repeal
them all without a vote of the Shareholders; such Bylaws shall be
deemed incorporated and included in the Governing Instrument;
(6) To elect and remove such officers and appoint and terminate such
agents as they consider appropriate;
(7) To employ one or more banks, trust companies or companies that are
members of a national securities exchange or such other domestic or
foreign entities as custodians of any assets of the Trust subject
to any conditions set forth in this Agreement or in the Bylaws;
(8) To retain one or more transfer agents and shareholder servicing
agents;
(9) To set record dates in the manner provided herein or in the Bylaws;
(10) To delegate such authority as they consider desirable to any
officers of the Trust and to any investment adviser, manager,
administrator, custodian, underwriter or other agent or independent
contractor;
(11) To sell or exchange any or all of the assets of the Trust, subject
to the right of Shareholders, if any, to vote on such transaction
pursuant to Section 6.1;
(12) To vote or give assent, or exercise any rights of ownership, with
respect to stock or other securities or property; and to execute
and deliver proxies and powers of attorney to such person or
persons as the Trustees shall deem proper, granting to such person
or persons such power and discretion with relation to securities or
property as the Trustee shall deem proper;
(13) To exercise powers and rights of subscription or otherwise that in
any manner arise out of ownership of securities;
(14) To hold any security or property in a form not indicating any
trust, whether in bearer, book entry, unregistered or other
negotiable form; or either in the name of the Trust or a custodian
or a nominee or nominees, subject in either case to proper
safeguards according to the usual practice of Delaware statutory
trusts or investment companies;
(15) To consent to or participate in any plan for the reorganization,
consolidation or merger of any corporation or concern, with respect
to any security which is held in the Trust; to consent to any
contract, lease, mortgage, purchase, or sale of property by such
corporation or concern, and to pay calls or subscriptions with
respect to any security held in the Trust;
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(16) To compromise, arbitrate, or otherwise adjust claims in favor of or
against the Trust or any matter in controversy including, but not
limited to, claims for taxes;
(17) To declare and pay dividends and make distributions of income and
of capital gains and capital to Shareholders in the manner
hereinafter provided;
(18) To repurchase Shares from time to time as permitted by applicable
law, upon such terms and conditions as the Trustees shall establish;
(19) To establish one or more committees or sub-committees, to delegate
any of the powers of the Trustees to said committees or
sub-committees and to adopt a written charter for one or more of
such committees or sub-committees governing its membership, duties
and operations and any other characteristics as the Trustees may
deem proper, each of which committees and sub-committees may
consist of less than the whole number of Trustees then in office,
and may be empowered to act for and bind the Trustees and the Trust
as if the acts of such committee or sub-committee were the acts of
all the Trustees then in office;
(20) To interpret the investment policies, practices or limitations of
the Trust;
(21) To establish a registered office and have a registered agent in the
State of Delaware;
(22) To enter into joint ventures, general or limited partnerships,
limited liability companies, and any other combinations and
associations; and
(23) In general, to carry on any other business in connection with or
incidental to any of the foregoing powers, to do everything
necessary, suitable or proper for the accomplishment of any purpose
or the attainment of any object or the furtherance of any power
hereinbefore set forth, either alone or in association with others,
and to do every other act or thing incidental or appurtenant to or
growing out of or connected with the aforesaid business or
purposes, objects or powers.
(b) The foregoing clauses of Section 4.1(a) shall be construed both as
objects and powers, and the foregoing enumeration of specific powers
shall not be held to limit or restrict in any manner the general
powers of the Trustees.
(c) Any action by one or more of the Trustees in their capacity as such
hereunder shall be deemed an action on behalf of the Trust, and not an
action in an individual capacity.
(d) The Trustees shall not be limited to investing in obligations maturing
before the possible termination of the Trust.
(e) No one dealing with the Trustees shall be under any obligation to make
any inquiry concerning the authority of the Trustees, or to see to the
application of any payments made or property transferred to the
Trustees or upon their order.
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Section 4.2 Issuance and Repurchase of Shares. The Trustees shall have the
power to issue, sell, repurchase, redeem, retire, cancel, acquire, hold,
resell, reissue, dispose of, and otherwise deal in Shares and, subject to the
provisions set forth in Articles II and VII hereof, to apply to any such
repurchase, redemption, retirement, cancellation or acquisition of Shares any
funds or property of the Trust with respect to which such Shares are issued.
Section 4.3 Action by the Trustees. Except as otherwise set forth herein,
the Board of Trustees or any committee or sub-committee thereof shall act by
majority vote of those present at a meeting duly called as set forth in the
Bylaws at which a quorum required by the Bylaws is present. Any action that may
be taken by the Board of Trustees or any committee or sub-committee thereof by
majority vote at a meeting duly called and at which a quorum required by the
Bylaws is present, may also be taken by written consent of at least
seventy-five percent (75%) of the Trustees or members of the committee or
sub-committee, as the case may be, without a meeting, provided that the writing
or writings are filed with the minutes of proceedings of the Board or committee
or sub-committee. Written consents or waivers of the Trustees may be executed
in one or more counterparts. Any written consent or waiver may be provided and
delivered to the Trust by any means by which notice may be given to a Trustee.
Subject to the requirements of the Governing Instrument and the 1940 Act, the
Trustees by Majority Trustee Vote may delegate to any Trustee or Trustees or
committee or sub-committee of Trustees, officer or officers of the Trust or any
agent of the Trust authority to approve particular matters or take particular
actions on behalf of the Trust; provided that if an action of the Trustees
requires a vote greater than a Majority Trustee Vote, such greater vote shall
be required to delegate such action to any Trustee or Trustees or committee or
sub-committee of Trustees.
Section 4.4 Principal Transactions. Subject to Article IX, the Trustees may,
on behalf of the Trust, buy any securities from or sell any securities to, or
lend any assets of the Trust to, any Trustee or officer of the Trust or any
firm of which any such Trustee or officer is a member acting as principal, or
have any such dealings with any investment adviser, underwriter, or transfer
agent for the Trust or with any Affiliated Person of such Person; and the Trust
may employ any such Person, or firm or Company in which such Person is an
Affiliated Person, as broker, legal counsel, registrar, investment adviser,
underwriter, administrator, transfer agent, dividend disbursing agent,
custodian, or in any capacity upon customary terms, subject in all cases to
applicable laws, rules, and regulations and orders of regulatory authorities.
Section 4.5 Payment of Expenses by the Trust. The Trustees are authorized to
pay or cause to be paid out of the principal or income of the Trust, or partly
out of the principal and partly out of income, all expenses, fees, charges,
taxes and liabilities incurred or arising in connection with the Trust, or in
connection with the management thereof, including, but not limited to, the
Trustees' compensation and such expenses and charges for the services of the
Trust's officers, employees, investment adviser and manager, administrator,
principal underwriter, auditors, counsel, custodian, transfer agent,
shareholder servicing agent, and such other agents or independent contractors
and such other expenses and charges as the Trustees may deem necessary or
proper to incur.
Section 4.6 Trustee Compensation. The Trustees as such shall be entitled to
reasonable compensation from the Trust. They may fix the amount of their
compensation. Nothing herein shall in any way prevent the employment of any
Trustee for advisory, management, administrative, legal, accounting, investment
banking, underwriting, brokerage, or investment dealer or other services and
the payment for the same by the Trust.
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Section 4.7 Independent Trustee. A Trustee who is an "independent trustee,"
as that term is defined in the Delaware Act, shall be deemed to be independent
and disinterested for all purposes when making any determinations or taking any
action as a Trustee.
ARTICLE V
INVESTMENT ADVISER, PRINCIPAL UNDERWRITER AND
TRANSFER AGENT
Section 5.1 Investment Adviser.
(a)The Trustees may in their discretion, from time to time, enter into an
investment advisory or management contract or contracts with respect to
the Trust whereby the other party or parties to such contract or
contracts shall undertake to furnish the Trustees with such management,
investment advisory, statistical and research facilities and services
and such other facilities and services, if any, and all upon such terms
and conditions, as the Trustees may in their discretion determine.
(b)The Trustees may authorize the investment adviser to employ, from time
to time, one or more sub-advisers to perform such of the acts and
services of the investment adviser, and upon such terms and conditions,
as may be agreed upon among the Trustees, the investment adviser and
sub-adviser. Any references in this Agreement to the investment adviser
shall be deemed to include such sub-advisers, unless the context
otherwise requires.
Section 5.2 Other Service Contracts. The Trustees may authorize the
engagement of a principal underwriter, transfer agent, administrator,
custodian, and any other service providers they deem to be in the best interest
of the Trust.
Section 5.3 Parties to Contract. Any contract of the character described in
Sections 5.1 and 5.2 may be entered into with any corporation, firm,
partnership, trust, association or other legal entity, although one or more of
the Trustees or officers of the Trust may be an officer, director, trustee,
shareholder, member, employee or agent or hold any other similar office with
respect to such other party to the contract.
Section 5.4 Miscellaneous. The fact that (i) any of the Shareholders,
Trustees or officers of the Trust is a shareholder, director, officer, partner,
trustee, employee, manager, adviser, principal underwriter or distributor or
agent of or for any company or of or for any parent or affiliate of any
company, with which an advisory or administration contract, or principal
underwriter's or distributor's contract, or transfer, shareholder servicing,
custodian or other agency contract may have been or may hereafter be made, or
that any such company, or any parent or affiliate thereof, is a Shareholder or
has an interest in the Trust, or that (ii) any company with which an advisory
or administration contract or principal underwriter's or distributor's
contract, or transfer, shareholder servicing, custodian, or other agency
contract may have been or may hereafter be made also has an advisory or
administration contract, or principal underwriter's or distributor's contract,
or transfer, shareholder servicing, custodian or other agency contract with one
or more other companies, or has other business or interests shall not affect
the validity of any such contract or disqualify any Shareholder, Trustee or
officer of the Trust from voting upon or executing the same or create any
liability or accountability to the Trust or its Shareholders.
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ARTICLE VI
SHAREHOLDERS' VOTING POWERS AND MEETING
Section 6.1 Voting Powers.
(a)The Shareholders shall have power to vote only to:
(1)Elect Trustees, provided that a meeting of Shareholders has been
called for that purpose;
(2)Approve transactions described in Section 6.2 and Article IX of this
Agreement;
(3)Approve any amendment to Section 3.3 to declassify the Board, to this
Article VI or Article IX or, to the extent required by Section 6.2,
to Section 8.4; and
(4)Approve such additional matters as may be required by the 1940 Act,
the Governing Instrument or any stock exchange on which the Shares
are listed for trading, or as the Trustees, in their sole discretion,
shall determine.
(b)Until Shares are issued, the Trustees may exercise all rights of
Shareholders and may take any action required or permitted by law, or by
the Governing Instrument that may be taken by Shareholders.
(c)Each whole Share shall be entitled to one vote as to any matter on which
it is entitled to vote, and each fractional Share shall be entitled to a
proportionate fractional vote.
(d)Except as otherwise provided in the Governing Instrument, on any matter
submitted to a vote of the Shareholders, all Shares shall be voted
together as a single class, except when required by applicable law,
Section 3.4(b) or when the Trustees have determined that the matter
affects the interests of one or more classes or affects each class
differently, then the Shareholders of each such affected class shall be
entitled to vote separately thereon.
(e)Shareholders shall not be entitled to cumulative voting in the election
of Trustees or on any other matter.
(f)Except as otherwise provided in the Governing Instrument, an affirmative
Majority Shareholder Vote shall be required to approve any matter
requiring a vote of the Shareholders.
(g)Only Record Owners shall have the power to cast a vote at a meeting of
shareholders subject to the voting provisions set forth in the Governing
Instrument. Beneficial owners of Shares who are not Record Owners shall
not be entitled to cast a vote at a meeting of Shareholders but shall be
entitled to provide voting instructions to corresponding Record Owners,
subject to any limitations imposed by applicable law and stock exchanges
on which the Shares are listed for trading.
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Section 6.2 Additional Voting Powers and Voting Requirements for Certain
Actions.
(a)Notwithstanding any other provision of this Agreement, the Shareholders
shall have power to vote to approve any amendment to Section 8.4 of this
Agreement approved by the Board of Trustees that would have the effect
of reducing the indemnification provided thereby to Shareholders or
former Shareholders, and any such action shall require the affirmative
vote or consent of Shareholders owning at least seventy-five percent
(75%) of the outstanding Shares.
(b)Notwithstanding any other provision of this Agreement, any amendment to
Section 3.3 to declassify the Board or to this Article VI or Article IX
of this Agreement shall require the affirmative vote or consent of the
Board of Trustees followed by the affirmative vote or consent of
Shareholders owning at least seventy-five percent (75%) of the
outstanding Shares, unless such amendment has been previously approved,
adopted or authorized by the affirmative vote of at least two-thirds (66
2/3%) of the Board of Trustees, in which case an affirmative Majority
Shareholder Vote shall be required.
(c)The voting requirements set forth in this Section 6.2 shall be in
addition to, and not in lieu of, any vote or consent of the Shareholders
otherwise required by applicable law (including, without limitation, any
separate vote by class that may be required by the 1940 Act) or by the
Governing Instrument.
(d)Any additional matter not expressly requiring a vote of Shareholders on
which the Trustees determine the Shareholders shall have power to vote
shall require the affirmative vote or consent of Shareholders owning at
least seventy-five percent (75%) of the outstanding Shares, unless such
matter has been previously approved, adopted or authorized by the
affirmative vote of at least two-thirds (66 2/3%) of the Board of
Trustees, in which case an affirmative Majority Shareholder Vote shall
be required.
ARTICLE VII
DISTRIBUTIONS AND REPURCHASES
Section 7.1 Distributions. The Trustees may from time to time declare and
pay dividends and make other distributions with respect to any Shares or class
thereof, which may be from surplus, income, capital gains or capital or
distributions in kind of the assets of the Trust. Subject to the rights of the
holders of Preferred Shares, if any, the amount of such dividends or
distributions and the payment of them and whether they are in cash or any other
Trust Property shall be wholly in the discretion of the Trustees, although the
Trustees pursuant to Section 4.1(a)(10) may delegate the authority to set
record, declaration, payment and ex-dividend dates, determine the amount of
dividends and distributions and pay such dividends and distributions. Dividends
and other distributions may be paid pursuant to a standing resolution adopted
once or more often as the Trustees determine. The Trustees shall have the power
and authority to amend, correct or change the amount of any declared dividend
or distribution from time to time until such dividend or distribution has been
paid to shareholders. All dividends and other distributions on Shares or a
class thereof shall be distributed pro rata to the Record Owners of such class,
as the case may be, in proportion to the number of Shares or Shares of such
class they held on the record date established for such payment. The Trustees
may adopt and offer to Shareholders such dividend reinvestment plans, cash
distribution payment plans, or similar plans as the Trustees deem appropriate.
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Section 7.2 Repurchase of Shares With Shareholder Consent.
(a) Subject to the Governing Instrument, the Trust may repurchase Shares
on the open market or such Shares as are tendered by any Record Owner for
repurchase pursuant to a repurchase offer or tender offer, if any, made by the
Trust periodically or from time to time, upon the presentation by the Record
Owner of a proper instrument of transfer together with a request directed to
the Trust, its transfer agent or other duly authorized agent, that the Trust
repurchase such Shares, or in accordance with such other procedures for
repurchase as the Board of Trustees may from time to time authorize; and the
Trust will pay therefor a price that meets the requirements of Section 23 of
the 1940 Act, and the rules and regulations adopted thereunder, and that is in
accordance with the terms of such repurchase offer, tender offer, the Governing
Instrument and other applicable law.
(b) The repurchase price may in any case or cases be paid wholly or
partly in kind if the Board of Trustees determines that such payment is
advisable in the interest of the Trust. Subject to the foregoing, the fair
value, selection and quantity of securities or other property of the Trust so
paid or delivered as all or part of the repurchase price shall be determined by
or under authority of the Board of Trustees. Subject to applicable law, the
Trust shall not be liable for any delay of any corporation or other Person in
transferring securities or other property selected for delivery as all or part
of any payment in kind.
Section 7.3 Repurchase of Shares Without Shareholder Consent. Subject to the
Governing Instrument, the Trust shall have the right at its option and at any
time, subject to the 1940 Act and other applicable law, to repurchase Shares of
any Shareholder at a price that meets the requirements of Section 23 of the
1940 Act, and the rules and regulations adopted thereunder, and that is in
accordance with the terms of the Governing Instrument and other applicable law:
(a) if at such time, such Shareholder owns Shares having an aggregate net asset
value of less than an amount determined from time to time by the Trustees; or
(b) to the extent that such Shareholder owns Shares in an amount less than,
equal to or in excess of a percentage or certain number of the Shares
determined from time to time by the Trustees.
Section 7.4 Transfer of Shares. Shares shall be transferable in accordance
with the provisions of the Bylaws.
Section 7.5 Redemptions. Unless otherwise provided in the rights of any
series of Preferred Shares, the Shares of the Trust are not redeemable at the
option of the holders thereof.
ARTICLE VIII
LIMITATION OF LIABILITY AND INDEMNIFICATION
Section 8.1 Limitation of Liability. A Trustee or officer of the Trust, when
acting in such capacity, shall not be personally liable to any person for any
act, omission or obligation of the Trust or any Trustee or officer of the
Trust; provided, however, that nothing contained herein shall protect any
Trustee or officer against any liability to the Trust or to Shareholders to
which the Trustee 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 or her office with the Trust.
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Section 8.2 Indemnification of Covered Persons. Every Covered Person shall
be indemnified by the Trust to the fullest extent permitted by the Delaware
Act, the Bylaws and other applicable law.
Section 8.3 Insurance. To the fullest extent permitted by applicable law,
the Board of Trustees shall have the authority to purchase with Trust Property
insurance for liability and for all expenses reasonably incurred or paid or
expected to be paid by a Covered Person in connection with any proceeding in
which such Covered Person becomes involved by virtue of such Covered Person's
actions, or omissions to act, in its capacity or former capacity with the
Trust, whether or not the Trust would have the power to indemnify such Covered
Person against such liability.
Section 8.4 Indemnification of Shareholders. In case any Shareholder or
former Shareholder of the Trust shall be held to be personally liable solely by
reason of his being or having been a Shareholder of the Trust and not because
of his acts or omissions or for some other reason, the Shareholder or former
Shareholder (or his heirs, executors, administrators or other legal
representatives, or, in the case of a corporation or other entity, its
corporate or general successor) shall be entitled, out of the Trust's assets,
to be held harmless from and indemnified against all loss and expense arising
from such liability in accordance with the Bylaws and applicable law. The
Trust, on its own behalf, shall upon request by the Shareholder, assume the
defense of any such claim made against the Shareholder for any act or
obligation of the Trust.
Section 8.5 Indemnification of the Trust. Except to the extent expressly set
forth in the Governing Instrument, each Shareholder will be liable to the Trust
for, and indemnify and hold harmless the Trust (and any subsidiaries or
affiliates thereof) from and against, all costs, expenses, penalties, fines or
other amounts, including without limitation, reasonable attorneys' and other
professional fees, whether third party or internal, arising from any action
against the Trust in which such Shareholder is not the prevailing party, and
shall pay such amounts on demand, together with interest on such amounts, which
interest will accrue at the lesser of the Trust's highest marginal borrowing
rate, per annum compounded, and the maximum amount permitted by law, from the
date such costs or the like are incurred until the receipt of payment. The
Trust is hereby permitted to redeem or repurchase Shares of any Shareholder
liable to the Trust under this Section 8.5 at a value determined by the Board
of Trustees in accordance with the 1940 Act and other applicable law, and to
set off against and retain any distributions otherwise payable to any
Shareholder liable to the Trust under this Section 8.5, in payment of amounts
due hereunder.
ARTICLE IX
CERTAIN TRANSACTIONS
Section 9.1 Vote Required. Notwithstanding any other provision of this
Agreement to the contrary and subject to the exceptions provided in this
Article IX, each of the transactions described in this Article IX shall require
the approval of the Board of Trustees followed by the affirmative vote of the
holders of not less than 75% of the outstanding Shares unless such transaction
has been previously approved by the affirmative vote of at least two-thirds (66
2/3%) of the Board of Trustees, in which case an affirmative Majority
Shareholder Vote shall be required. Such affirmative vote shall be in addition
to the vote or consent of Shareholders otherwise required by law or by the
terms of any class of Preferred Shares, whether now or hereafter authorized, or
any agreement between the Trust and any national securities exchange.
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Section 9.2 Dissolution of the Trust or Termination of a Class.
(a)The Trust shall have perpetual existence, except that the Trust shall be
dissolved upon approval by vote of the Board followed by a vote of
Shareholders as set forth in Section 9.1; provided that if the
affirmative vote of at least seventy-five percent (75%) of the Board
approves the dissolution, no vote of Shareholders shall be required to
dissolve the Trust.
(b)Upon dissolution of the Trust, the Trust shall carry on no business
except for the purpose of winding up its affairs, and all powers of the
Trustees under this Agreement shall continue until such affairs have
been wound up. Without limiting the foregoing, the Trustees shall (in
accordance with Section 3808 of the Delaware Act) have the power to:
(1)Fulfill or discharge the contracts of the Trust;
(2)Collect its assets;
(3)Sell, convey, assign, exchange, merge where the Trust is not the
survivor, transfer or otherwise dispose of all or any part of the
remaining Trust Property to one or more Persons at public or private
sale for consideration which may consist in whole or in part in cash,
securities or other property of any kind;
(4)Pay or make reasonable provision (including through the use of a
liquidating trust) to pay all claims and obligations of the Trust,
including all contingent, conditional or unmatured claims and
obligations known to the Trust, and all claims and obligations which
are known to the Trust, but for which the identity of the claimant is
unknown, and claims and obligations that have not been made known to
the Trust or that have not arisen but that, based on the facts known
to the Trust, are likely to arise or to become known to the Trust
within 10 years after the date of dissolution; and
(5)Do all other acts appropriate to liquidate its business.
(c)If there are sufficient assets held with respect to the Trust, such
claims and obligations shall be paid in full and any such provisions for
payment shall be made in full. If there are insufficient assets held
with respect to the Trust, such claims and obligations shall be paid or
provided for according to their priority and, among claims and
obligations of equal priority, ratably to the extent of assets available
therefor. Any remaining assets (including, without limitation, cash,
securities or any combination thereof) held with respect to the Trust
shall be distributed to the Record Owners of the Trust ratably according
to the number of Shares of the Trust held of record by the several
Record Owners on the date for such dissolution distribution, subject to
any then existing preferential rights of Shares.
(d)On completion of distribution of the remaining assets and upon the
winding up of the Trust in accordance with Section 3808 of the Delaware
Act and its termination, any one (1) Trustee shall execute, and cause to
be filed, a certificate
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of cancellation, with the office of the Secretary of State of the State
of Delaware in accordance with the provisions of Section 3810 of the
Delaware Act, whereupon the Trust shall terminate and the Trustees and
the Trust shall be discharged from all further liabilities and duties
hereunder with respect thereto. The Trustees shall not be personally
liable to the claimants of the dissolved Trust by reason of the
Trustees' actions in winding up the Trust's affairs if the Trustees
complied with Section 3808(e) of the Delaware Act.
(e)Each class hereafter created shall have perpetual existence unless
terminated upon:
(1)The vote of the Board of Trustees; or
(2)The occurrence of a termination event pursuant to any Board
resolution establishing and designating such class.
Section 9.3 Merger or Consolidation; Conversion; Reorganization.
(a)Merger or Consolidation.
(1)Pursuant to an agreement of merger or consolidation, the Board of
Trustees may cause the Trust or any of its subsidiaries to merge or
consolidate with or into one or more statutory trusts or "other
business entities" (as defined in Section 3801 of the Delaware Act)
formed or organized or existing under the laws of the State of
Delaware or any other state of the United States or any foreign
country or other foreign jurisdiction. Any such merger or
consolidation shall require approval by vote of the Board of Trustees
followed by approval of the Shareholders as set forth in Section 9.1.
(2)By reference to Section 3815(f) of the Delaware Act, any agreement of
merger or consolidation approved in accordance with this
Section 9.3(a) may, without a separate Shareholder vote, unless
required by the 1940 Act or the requirements of any stock exchange on
which Shares are listed for trading, effect any amendment to the
Governing Instrument or effect the adoption of a new governing
instrument if the Trust is the surviving or resulting statutory trust
in the merger or consolidation, which amendment or new governing
instrument shall be effective at the effective time or date of the
merger or consolidation.
(3)If the Trust is to be the surviving or resulting statutory trust, any
one (1) Trustee shall execute, and cause to be filed, a certificate
of merger or consolidation in accordance with Section 3815 of the
Delaware Act.
(b)Conversion.
(1)The Board of Trustees may cause:
(A) The Trust to convert to an "other business entity" (as defined
in Section 3801 of the Delaware Act) formed or organized under the
laws
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of the State of Delaware as permitted pursuant to Section 3821 of the
Delaware Act;
(B) The Shares of the Trust to be converted into beneficial
interests in another statutory trust; or
(C) The Shares to be exchanged under or pursuant to any state or
federal statute to the extent permitted by law.
(2)Any such statutory conversion, Share conversion or Share exchange
shall require approval by vote of the Board of Trustees followed by
the approval of the Shareholders of the Trust as set forth in
Section 9.1.
(c)Reorganization.
(1)The Board of Trustees may cause the Trust to sell, convey and
transfer all or substantially all of the assets of the Trust ("sale
of Trust assets") to another trust, statutory trust, partnership,
limited partnership, limited liability company, corporation or other
association organized under the laws of any state, or to one or more
separate series thereof, in exchange for cash, shares or other
securities, with such sale, conveyance and transfer either (a) being
made subject to, or with the assumption by the transferee of, the
liabilities associated with the Trust, or (b) not being made subject
to, or not with the assumption of, such liabilities.
(2)Any such sale, conveyance and transfer shall require approval by vote
of the Board of Trustees followed by the approval of the Shareholders
of the Trust as set forth in Section 9.1.
(3)Following such sale of Trust assets, the Board of Trustees shall
distribute such cash, shares or other securities ratably among the
Record Owners of the Trust (giving due effect to the differences
among the various classes).
(4)If all of the assets of the Trust have been so sold, conveyed and
transferred, the Trust shall be dissolved.
Section 9.4 Reclassification of the Trust. The Board of Trustees may cause
the Trust to be converted from a "closed-end company" to an "open-end company"
(as those terms are defined, respectively, in Sections 5(a)(2) and 5(a)(1) of
the 1940 Act). Such reclassification of the Trust shall require approval by
vote of the Board of Trustees followed by the approval of Shareholders as set
forth in Section 9.1.
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Section 9.5 Principal Shareholder Transactions.
(a)Notwithstanding any other provision of this Agreement and subject to the
exceptions provided in Section 9.5(c), the types of transactions
described in sub-paragraphs (1) through (3) below shall require approval
by vote of the Board of Trustees and the Shareholders of the Trust as
set forth in Section 9.1 when a Principal Shareholder (as defined in
Section 9.5(b)) is a party to the transaction.
(1)The issuance of any securities of the Trust or any of its
subsidiaries to any Principal Shareholder for cash (other than
pursuant to any dividend reinvestment plan).
(2)The sale, lease or exchange of all or any substantial part of the
assets of the Trust or any of its subsidiaries to any Principal
Shareholder (except assets having an aggregate fair market value of
less than two percent (2%) of the total assets of the Trust or any of
its subsidiaries, aggregating for the purpose of such computation all
assets sold, leased or exchanged in any series of similar
transactions within a twelve-month period).
(3)The sale, lease, or exchange to the Trust or any subsidiary thereof,
in exchange for securities of the Trust or any of its subsidiaries,
of any assets of any Principal Shareholder (except assets having an
aggregate fair market value of less than two percent (2%) of the
total assets of the Trust or any of its subsidiaries, aggregating for
the purpose of such computation, all assets sold, leased or exchanged
in any series of similar transactions within a twelve-month period).
(b)For purposes of this Section 9.5, the term "Principal Shareholder" shall
mean any Person or group (within the meaning of Rule 13d-5 under the
Securities Exchange Act of 1934, as amended (the "1934 Act")), that is
the beneficial owner, directly or indirectly, of five percent (5%) or
more of the Shares of the Trust and shall include any affiliate or
associate, as such terms are defined in clause (2) below, of a Principal
Shareholder, but shall not include the investment adviser of the Trust
or any affiliated person of the investment adviser of the Trust. For the
purposes of this Section 9.5, in addition to the Shares that a Principal
Shareholder beneficially owns directly, a Principal Shareholder shall be
deemed to be the beneficial owner of any Shares (1) which the Principal
Shareholder has the right to acquire pursuant to any agreement or upon
exercise of conversion rights or warrants, or otherwise or (2) which are
beneficially owned, directly or indirectly (including Shares deemed
owned through application of clause (1) above), by any other Person or
group with which the Principal Shareholder or its "affiliate" or
"associate," as those terms are defined in Rule 12b-2, or any successor
rule, under the 1934 Act, has any agreement, arrangement, or
understanding for the purpose of acquiring, holding, voting, or
disposing of Shares, or which is its "affiliate" or "associate" as so
defined. For purposes of this Section 9.5, calculation of the total
Shares of the Trust shall not include Shares deemed owned through
application of clause (1) above.
(c)The provisions of this Section 9.5 shall not be applicable to any such
transaction between the Trust and any entity of which a majority of the
outstanding shares of
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all classes and series of a stock normally entitled to vote in elections
of directors is owned of record and beneficially by the Trust and its
subsidiaries.
(d)The Board of Trustees shall have the power and duty to determine for the
purposes of this Section 9.5, on the basis of information known to the
Trust, whether:
(1)A Person or group beneficially owns five percent (5%) or more of the
Shares;
(2)A corporation, person or entity is an "affiliate" or "associate" (as
defined above) of another; and
(3)The assets being sold, leased or exchanged by or to the Trust have an
aggregate fair market value of less than 2% of the total assets of
the Trust (as defined above).
Any such determination shall be conclusive and binding for all purposes
of this Section 9.5 in the absence of manifest error.
Section 9.6 Absence of Appraisal or Dissenters' Rights. No Shareholder shall
be entitled, as a matter of right, to an appraisal by the Delaware Court of
Chancery or otherwise of the fair value of the Shareholder's Shares or to any
other relief as a dissenting Shareholder in respect of any proposal or action
involving the Trust or any class of Shares.
ARTICLE X
MISCELLANEOUS
Section 10.1 Trust Not a Partnership; Taxation.
(a)It is hereby expressly declared that a trust and not a partnership is
created hereby. All persons extending credit to, contracting with or
having any claim against the Trust or the Trustees in their capacity as
such shall look only to the assets of the Trust for payment under such
credit, contract or claim; and neither the Shareholders, the Trustees,
nor the Trust's officers nor any of the agents of the Trustees whether
past, present or future, shall be personally liable therefor.
(b)It is intended that the Trust be classified for income tax purposes as
an association taxable as a corporation, and the Trustees shall do all
things that they, in their sole discretion, determine are necessary to
achieve that objective, including (if they so determine), electing such
classifications on Internal Revenue Form 8832. The Trustees, in their
sole discretion and without the vote or consent of the Shareholders, may
amend this Agreement to ensure that this objective is achieved.
Section 10.2 Trustee's Good Faith Action, Expert Advice, No Bond or Surety.
The exercise by the Trustees of their powers and discretion hereunder in good
faith and with reasonable care under the circumstances then prevailing shall be
binding upon everyone interested. Subject to the provisions of Article VIII and
to this Section 10.2, the Trustees shall not be liable for errors of judgment
or mistakes of fact or law. The Trustees may take advice of counsel or other
experts with respect to the meaning and operation of this Agreement, and
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subject to the provisions of Article VIII and this Section 10.2, shall be under
no liability for any act or omission in accordance with such advice or for
failing to follow such advice. The Trustees shall not be required to give any
bond as such, nor any surety if a bond is obtained.
Section 10.3 Filing of Copies, References, Headings. The original or a copy
of this Agreement or any amendment hereto or any supplemental agreement shall
be kept at the office of the Trust. Headings are placed herein for convenience
of reference only and in case of any conflict, the text of this Agreement,
rather than the headings, shall control. This Agreement may be executed in any
number of counterparts each of which shall be deemed an original.
Section 10.4 Governing Law.
(a)The Trust and the Governing Instrument (including this Agreement) and
the rights, obligations and remedies of the Trustees and Shareholders
hereunder, are to be governed by and construed and administered
according to the Delaware Act, including the provision that gives
maximum freedom to contract, the other laws of the State of Delaware and
the applicable provisions of the 1940 Act. Notwithstanding the
foregoing, the following provisions shall not be applicable to the
Trust, the Trustees, the Shareholders or the Governing Instrument:
(1)The provisions of Section 3533, 3540, 3561 and 3583(a) of Title 12 of
the Delaware Code; or
(2)Any provisions of the laws (statutory or common) of the State of
Delaware (other than the Delaware Act) pertaining to trusts which
relate to or regulate:
(A) The filing with any court or governmental body or agency of
trustee accounts or schedules of trustee fees and charges;
(B) Affirmative requirements to post bonds for trustees, officers,
agents or employees of a trust;
(C) The necessity for obtaining court or other governmental approval
concerning the acquisition, holding or disposition of real or
personal property;
(D) Fees or other sums payable to trustees, officers, agents or
employees of a trust;
(E) The allocation of receipts and expenditures to income or
principal;
(F) Restrictions or limitations on the permissible nature, amount or
concentration of trust investments or requirements relating to the
titling, storage or other manner of holding of trust assets; or
(G) The establishment of fiduciary or other standards or
responsibilities or limitations on the indemnification, acts or
powers of trustees or other Persons, which are inconsistent with the
limitations of
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liabilities or authorities and powers of the Trustees or officers of
the Trust set forth or referenced in the Governing Instrument.
(b)The Trust shall be of the type commonly called a "statutory trust," and
without limiting the provisions hereof, the Trust may exercise all
powers which are ordinarily exercised by such a trust under Delaware
law. The Trust specifically reserves the right to exercise any of the
powers or privileges afforded to trusts or actions that may be engaged
in by trusts under the Delaware Act, and the absence of a specific
reference herein to any such power, privilege or action shall not imply
that the Trust may not exercise such power or privilege or take such
actions; provided, however, that the exercise of any such power,
privilege or action shall not otherwise violate applicable law.
Section 10.5 Amendments. Except as specifically provided in Article VI
hereof or otherwise expressly limited by the Governing Instrument, the Trustees
may, without any Shareholder vote, amend this Agreement by making an amendment
to this Agreement, an agreement supplemental hereto, or an amended and restated
trust instrument. Any such amendment to any Article of this Agreement except to
Section 3.2 to change the minimum or maximum number of trustees, to Section 3.3
to declassify the Board, to Article VI or Article IX, to the extent required by
Section 6.2, to Section 8.4, or to this Section 10.5, having been approved by a
Majority Trustee Vote, shall become effective, unless otherwise provided by
such Trustees (notwithstanding that the section being amended may require a
higher Trustee vote), upon being executed by a duly authorized officer of the
Trust. Any amendment to Section 3.2 to change the minimum or maximum number of
trustees or to this Section 10.5, having been approved by the affirmative vote
of 75% of the Board of Trustees shall become effective upon being executed by a
duly authorized officer of the Trust. For the avoidance of doubt, any
determination of the number of trustees within the minimum and maximum range
may be determined by a majority of the Trustees and the provisions of
Section 3.4(b) to increase the size of the Board are not subject to a Majority
Trustee Vote. Any amendment to Section 3.3 to declassify the Board or to
Article VI or Article IX, or, to the extent required by Section 6.2,
Section 8.4, having been approved by the requisite vote of the Board of
Trustees followed by the requisite vote of the Shareholders as provided in
Section 9.1, shall become effective upon being executed by a duly authorized
officer of the Trust. A certification signed by a duly authorized officer of
the Trust setting forth an amendment to this Agreement and reciting that it was
duly adopted by the Shareholders or by the Trustees as aforesaid, or a copy of
this Agreement, as amended, executed by a majority of the Trustees, or a duly
authorized officer of the Trust, shall be conclusive evidence of such amendment
when lodged among the records of the Trust.
Section 10.6 Provisions in Conflict with Law. The provisions of this
Agreement are severable, and if the Trustees shall determine, with the advice
of counsel, that any of such provisions is in conflict with applicable law, the
conflicting provision shall be deemed never to have constituted a part of this
Agreement; provided, however, that such determination shall not affect any of
the remaining provisions of this Agreement or render invalid or improper any
action taken or omitted prior to such determination. If any provision of this
Agreement shall be held invalid or unenforceable in any jurisdiction, such
invalidity or unenforceability shall attach only to such provision in such
jurisdiction and shall not in any manner affect such provisions in any other
jurisdiction or any other provision of this Agreement in any jurisdiction.
Section 10.7 Record Owners' Right to Shareholder List and Other Records.
Except as may be required by Regulation 14A promulgated under the 1934 Act, no
Shareholder shall have
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the right to obtain from the Trust a list of the Trust's Shareholders. Except
as required by the Act or as expressly provided in the Governing Instrument,
Shareholders shall have no right to inspect the records, documents, accounts
and books of the Trust. Any request to inspect the records of the Trust shall
be submitted by the Shareholder to the Trust in writing. Upon receipt of any
such request, the Trustees shall determine whether delivery of records
pertaining to such request is required by the Act or is otherwise necessary or
appropriate, as determined by the Trustees in their sole discretion, and
whether such request complies with the requirements of the Act and, if so,
establish procedures for such inspection. To preserve the integrity of the
records, the Trust may provide certified copies of Trust records rather than
originals. The Trust shall not be required to create records or obtain records
from third parties to satisfy a Shareholder request. The Trust may require a
requesting Shareholder to pay in advance or otherwise indemnify the Trust for
the costs and expenses of such Shareholder's inspection of records. The rights
provided for in this Section 10.7 shall not extend to any Person who is a
Shareholder but not also a Record Owner.
Section 10.8 Reports. The Trustees shall cause to be prepared at least
annually and more frequently to the extent and in the form required by law,
regulation or any stock exchange on which Shares are listed a report of
operations containing a balance sheet and statement of income and undistributed
income of the Trust prepared in conformity with generally accepted accounting
principles and an opinion of an independent public accountant on such financial
statements. Copies of such reports shall be mailed to all Shareholders within
the time required by the 1940 Act, and in any event within a reasonable period
preceding the meeting of Shareholders. The Trustees shall, in addition, furnish
to the Shareholders at least semi-annually to the extent required by law,
interim reports containing an unaudited balance sheet of the Trust as of the
end of such period and an unaudited statement of income and surplus for the
period from the beginning of the current fiscal year to the end of such period.
Section 10.9 Use of the Name "Invesco". The Board of Trustees expressly
agrees and acknowledges that the name "Invesco" is the sole property of Invesco
Ltd. ("Invesco"). Invesco has granted to the Trust a non-exclusive license to
use such name as part of the name of the Trust now and in the future. The Board
of Trustees further expressly agrees and acknowledges that the non-exclusive
license granted herein may be terminated by Invesco if the Trust ceases to use
Invesco or one of its Affiliated Persons as investment adviser or to use other
Affiliated Persons or successors of Invesco for such purposes. In such event,
the non-exclusive license may be revoked by Invesco and the Trust shall cease
using the name "Invesco" or any name misleadingly implying a continuing
relationship between the Trust and Invesco or any of its Affiliated Persons, as
part of its name unless otherwise consented to by Invesco or any successor to
its interests in such name.
The Board of Trustees further understands and agrees that so long as Invesco
and/or any future advisory Affiliated Person of Invesco shall continue to serve
as the Trust's investment adviser, other registered open- or closed-end
investment companies ("funds") and other types of investment vehicles as may be
sponsored or advised by Invesco or its Affiliated Persons shall have the right
permanently to adopt and to use the name "Invesco" in their names and in the
names of any series or class of shares of such funds.
27
<PAGE>
IN WITNESS WHEREOF, the undersigned, being all of the Trustees of the
Trust, have executed this instrument this 15th day of May, 2012.
------------------------------
David C. Arch
------------------------------
Jerry D. Choate
------------------------------
Linda Hutton Heagy
------------------------------
R. Craig Kennedy
------------------------------
Colin D. Meadows
------------------------------
Hugo F. Sonnenschein
------------------------------
Wayne W. Whalen
------------------------------
Suzanne H. Woolsey, Ph.D.
28
<PAGE>
DECLARATION OF TRUST, dated as of March 27, 2012, by the individual
trustee identified on the signature page hereto (the "Trustee"). The Trustee
hereby agrees as follows:
1. The trust created hereby (the "Trust") shall be known as "Invesco Van
Kampen Trust for Value Municipals" in which name the Trustee may conduct the
business of the Trust, make and execute contracts, and sue and be sued.
2. The Trustee hereby declares that he will hold the trust estate in
trust for such persons as are or may become entitled to a beneficial interest
in the trust estate. It is the intention of the parties hereto that the Trust
created hereby constitute a statutory trust under Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code (S) 3801 et seq., and that this document
constitutes the governing instrument of the Trust. The Trustee is hereby
authorized and directed to execute and file a certificate of trust in the
office of the Secretary of State of the State of Delaware. The Trust is hereby
established by the Trustee for the purpose of becoming a registered investment
company under the Investment Company Act of 1940, as amended (the "1940 Act"),
and engaging in such other activities as are necessary, convenient or
incidental thereto.
3. The Trustee intends to enter into an amended and restated Agreement
and Declaration of Trust and to appoint additional trustees thereunder to
provide for the contemplated operation of the Trust created hereby. Prior to
the execution and delivery of such amended and restated Agreement and
Declaration of Trust, the Trustee shall not have any duty or obligation
hereunder or with respect to the trust estate, except as required by law.
4. The following persons be, and they hereby are, elected to the offices
listed opposite their names, each to serve (a) until the first meeting of the
Board of Trustees and until his successor shall have been elected and shall
have qualified, (b) until his death or (c) until he shall have resigned or have
been removed by the Trustee:
Colin Meadows President and Principal Executive Officer
Sheri Morris Treasurer and Principal Financial Officer
John M. Zerr Secretary and Chief Legal Officer
5. The Trustee and the officers of the Trust are hereby authorized:
(i) to prepare and file with the Securities and Exchange Commission (the
"Commission") and execute, in each case on behalf of the Trust, (a) a
Registration Statement on Form 8-A (including any pre-effective or
post-effective amendments thereto) relating to the registration of the
securities of the Trust under Section 12(b) of the Securities Exchange Act of
1934, as amended (the "1934 Act"), (b) the Notification of Registration on
Form N-8A relating to the registration of the Trust under the 1940 Act, and
(c) any additional filing, request, report or application or amendment thereto
with the Commission that may be required from time to time under the 1940 Act,
the Securities Act of 1933, as amended (the "1933 Act") or the 1934 Act, and
the rules and regulations promulgated thereunder; (ii) to prepare, execute and
file, in each case on behalf of the Trust, such applications, reports, surety
bonds, irrevocable consents, appointments of attorney for service of process
and other papers and documents as shall be necessary or desirable to register
the securities of the Trust under the securities or "blue sky" laws of such
jurisdictions as the
<PAGE>
Trustee and officers may deem necessary or desirable; (iii) to negotiate the
terms of, and execute on behalf of the Trust, such investment advisory
agreements and other contracts among the Trust and any other persons relating
to the operation of the Trust or the issuance of the securities of the Trust,
satisfactory to each such party and (iv) to make any and all necessary filings
and to take any and all actions, including, without limitation, the execution
and delivery of any and all documents, amendments, certificates or other
instruments, that they, together with and upon the advice of counsel, shall
deem necessary or advisable to conduct the business of the Trust, such
determination to be conclusively evidenced by the taking of such actions and
steps and the execution and delivery of such documents, amendments,
certificates or other instruments.
6. The number of Trustees initially shall be one (1) and thereafter the
number of Trustees shall be such number as shall be fixed in an amended and
restated Agreement and Declaration of Trust. The sole Trustee may resign upon
acceptance of the trusts by the additional trustees appointed by the sole
Trustee.
7.(a) The Trustees and the officers of the Trust (the "Fiduciary
Indemnified Persons") shall not be liable, responsible or accountable in
damages or otherwise to the Trust, the Trustees or any holder of the Trust's
securities (the Trust and any holder of the Trust's securities being a "Covered
Person") for any loss, damage or claim incurred by reason of any act or
omission performed or omitted by the Fiduciary Indemnified Persons in good
faith on behalf of the Trust and in a manner the Fiduciary Indemnified Persons
reasonably believed to be within the scope of authority conferred on the
Fiduciary Indemnified Persons by this Declaration of Trust or by law, except
that the Fiduciary Indemnified Persons shall be liable for any such loss,
damage or claim incurred by reason of the Fiduciary Indemnified Person's gross
negligence or willful misconduct with respect to such acts or omissions.
(b) The Fiduciary Indemnified Persons shall be fully protected in
relying in good faith upon the records of the Trust and upon such information,
opinions, reports or statements presented to the Trust by any person as to
matters the Fiduciary Indemnified Persons reasonably believes are within such
other person's professional or expert competence and who has been selected with
reasonable care by or on behalf of the Trust, including information, opinions,
reports or statements as to the value and amount of the assets, liabilities,
profits, losses, or any other facts pertinent to the trust estate.
8. The Trust shall, to the fullest extent permitted by applicable law,
(a) indemnify and hold harmless each Fiduciary Indemnified Person
from and against any loss, damage, liability, tax, penalty, expense or claim of
any kind or nature whatsoever incurred by the Fiduciary Indemnified Persons by
reason of the creation, operation or termination of the Trust in a manner the
Fiduciary Indemnified Persons reasonably believed to be within the scope of
authority conferred on the Fiduciary Indemnified Persons by this Declaration of
Trust, except that no Fiduciary Indemnified Persons shall be entitled to be
indemnified in respect of any loss, damage or claim incurred by the Fiduciary
Indemnified Persons by reason of gross negligence or willful misconduct with
respect to such acts or omissions; and
(b) advance expenses (including legal fees) incurred by a Fiduciary
Indemnified Person in defending any claim, demand, action, suit or proceeding,
from time to
<PAGE>
time, prior to the final disposition of such claim, demand, action, suit or
proceeding, upon receipt by the Trust of an undertaking by or on behalf of such
Fiduciary Indemnified Persons to repay such amount if it shall be determined
that such Fiduciary Indemnified Person is not entitled to be indemnified as
authorized in the preceding subsection.
9. The provisions of Section 8 shall survive the resignation or removal
of the Fiduciary Indemnified Persons.
10. The Trust may terminate without issuing any securities at the
election of the Trustees.
11. This Declaration of Trust and the rights of the parties hereunder
shall be governed by and interpreted in accordance with the laws of the State
of Delaware and all rights and remedies shall be governed by such laws without
regard to the principles of conflict of laws.
IN WITNESS WHEREOF, the parties hereto have caused this Declaration of
Trust to be duly executed as of the day and year first above written.
/s/ John M. Zerr
------------------------------
John M. Zerr
<PAGE>
CERTIFICATE OF TRUST
OF
INVESCO VAN KAMPEN TRUST FOR VALUE MUNICIPALS
This Certificate of Trust of Invesco Van Kampen Trust for Value Municipals
(the "Trust"), is being duly executed and filed on behalf of the Trust by the
undersigned, as trustee, to form a statutory trust under the Delaware Statutory
Trust Act (12 Del. C. Section 3801 et seq.) (the "Act").
1. Name. The name of the trust formed hereby is Invesco Van Kampen Trust for
Value Municipals.
2. Registered Office; Registered Agent. The business address of the Trust's
registered office in the State of Delaware is 1209 Orange Street, Wilmington,
DE 19801, New Castle County. The name of the Trust's registered agent at such
address is The Corporation Trust Company.
3. Investment Company. The Trust will be a registered investment company
under the Investment Company Act of 1940, as amended.
4. Effective Date. This Certificate of Trust shall be effective upon filing.
IN WITNESS WHEREOF, the undersigned has duly executed this Certificate of
Trust in accordance with Section 3811(a)(1) of the Act.
/s/ John M. Zerr
------------------------------
Name: John M. Zerr
Title: Trustee
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.77Q1E
<SEQUENCE>3
<FILENAME>dex9977q1e.txt
<DESCRIPTION>EX-99.77Q1E
<TEXT>
<PAGE>
Sub-Item 77Q1(e)
MASTER INVESTMENT ADVISORY AGREEMENT
THIS AGREEMENT is made this 15th day of October, 2012, by and
between Invesco Van Kampen Trust for Value Municipals, a Delaware statutory
trust (the "Trust"), and Invesco Advisers, Inc., a Delaware corporation (the
"Adviser").
RECITALS
WHEREAS, the Trust is registered under the Investment Company Act of 1940,
as amended (the "1940 Act"), as a closed-end management investment company;
WHEREAS, the Adviser is registered under the Investment Advisers Act of
1940, as amended (the "Advisers Act"), as an investment Adviser and engages in
the business of acting as an investment adviser;
WHEREAS, the Trust and the Adviser desire to enter into an agreement to
provide for investment advisory services to the Trust upon the terms and
conditions hereinafter set forth;
NOW THEREFORE, in consideration of the mutual covenants herein contained and
other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties agree as follows:
1. Advisory Services. The Adviser shall act as investment adviser for the
Trust and shall, in such capacity, supervise all aspects of the Trust's
operations, including the investment and reinvestment of cash, securities or
other properties comprising the Trust's assets, subject at all times to the
policies and control of the Board of Trustees. The Adviser shall give the Trust
the benefit of its best judgment, efforts and facilities in rendering its
services as investment advisor.
2. Investment Analysis and Implementation. In carrying out its obligations
under Section 1 hereof, the Adviser shall:
(a) supervise all aspects of the operations of the Trust;
(b) obtain and evaluate pertinent information about significant
developments and economic, statistical and financial data, domestic,
foreign or otherwise, whether affecting the economy generally or the
Trust, and whether concerning the individual issuers whose securities
are included in the assets of the Trust or the activities in which such
issuers engage, or with respect to securities which the Adviser
considers desirable for inclusion in the Trust's assets;
(c) determine which issuers and securities shall be represented in
the Trust's investment portfolios and regularly report thereon to the
Board of Trustees;
(d) formulate and implement continuing programs for the purchases and
sales of the securities of such issuers and regularly report thereon to
the Board of Trustees; and
(e) take, on behalf of the Trust, all actions which appear to the
Trust necessary to carry into effect such purchase and sale programs and
supervisory functions as aforesaid, including but not limited to the
placing of orders for the purchase and sale of securities for the Trust.
3. Securities Lending Duties and Fees. The Adviser agrees to provide the
following services in connection with the securities lending activities of the
Trust: (a) oversee participation in the securities lending program to ensure
compliance with all applicable regulatory and investment guidelines; (b) assist
the securities lending agent or principal (the "Agent") in determining which
specific securities are available for loan; (c) monitor the Agent to ensure
that securities loans are effected in accordance with the Adviser's
instructions and with procedures adopted by the Board of Trustees; (d) prepare
appropriate periodic reports for, and seek appropriate approvals from, the
Board of Trustees with respect to securities lending activities; (e) respond to
Agent inquiries; and (f) perform such other duties as necessary.
<PAGE>
As compensation for such services provided by the Adviser in connection with
securities lending activities, the Trust shall pay the Adviser a fee equal to
25% of the net monthly interest or fee income retained or paid to the Trust
from such activities.
4. Delegation of Responsibilities. The Adviser is authorized to delegate any
or all of its rights, duties and obligations under this Agreement to one or
more sub-advisers, and may enter into agreements with sub-advisers, and may
replace any such sub-advisors from time to time in its discretion, in
accordance with the 1940 Act, the Advisers Act, and rules and regulations
thereunder, as such statutes, rules and regulations are amended from time to
time or are interpreted from time to time by the staff of the Securities and
Exchange Commission ("SEC"), and if applicable, exemptive orders or similar
relief granted by the SEC and upon receipt of approval of such sub-advisors by
the Board of Trustees and by shareholders (unless any such approval is not
required by such statutes, rules, regulations, interpretations, orders or
similar relief).
5. Independent Contractors. The Adviser and any sub-advisers shall for all
purposes herein be deemed to be independent contractors and shall, unless
otherwise expressly provided or authorized, have no authority to act for or
represent the Trust in any way or otherwise be deemed to be an agent of the
Trust.
6. Control by Board of Trustees. Any investment program undertaken by the
Adviser pursuant to this Agreement, as well as any other activities undertaken
by the Adviser on behalf of the Funds, shall at all times be subject to any
directives of the Board of Trustees.
7. Compliance with Applicable Requirements. In carrying out its obligations
under this Agreement, the Adviser shall at all times conform to:
(a) all applicable provisions of the 1940 Act and the Advisers Act and
any rules and regulations adopted thereunder;
(b) the provisions of the registration statement of the Trust, as the
same may be amended from time to time under the Securities Act of 1933 and
the 1940 Act;
(c) the provisions of the Declaration of Trust, as the same may be
amended from time to time;
(d) the provisions of the by-laws of the Trust, as the same may be
amended from time to time; and
(e) any other applicable provisions of state, federal or foreign law.
8. Broker-Dealer Relationships. The Adviser is responsible for decisions to
buy and sell securities for the Trust, broker-dealer selection, and negotiation
of brokerage commission rates.
(a) The Adviser's primary consideration in effecting a security
transaction will be to obtain the best execution.
(b) In selecting a broker-dealer to execute each particular transaction,
the Adviser will take the following into consideration: the best net price
available; the reliability, integrity and financial condition of the
broker-dealer; the size of and the difficulty in executing the order; and
the value of the expected contribution of the broker-dealer to the
investment performance of the Trust on a continuing basis. Accordingly, the
price to the Trust in any transaction may be less favorable than that
available from another broker-dealer if the difference is reasonably
justified by other aspects of the fund execution services offered.
(c) Subject to such policies as the Board of Trustees may from time to
time determine, the Adviser shall not be deemed to have acted unlawfully or
to have breached any duty created by this Agreement or otherwise solely by
reason of its having caused the Trust to pay a broker or dealer that
provides brokerage and research services to the Adviser an amount of
commission for effecting a fund investment transaction in excess of the
amount of commission another broker or dealer would have charged for
effecting that transaction, if the Adviser determines in good faith that
such amount of commission was reasonable in relation to the value of
2
<PAGE>
the brokerage and research services provided by such broker or dealer,
viewed in terms of either that particular transaction or the Adviser's
overall responsibilities with respect to the Trust, and to other clients of
the Adviser as to which the Adviser exercises investment discretion. The
Adviser is further authorized to allocate the orders placed by it on behalf
of the Trust to such brokers and dealers who also provide research or
statistical material, or other services to the Trust, to the Adviser, or to
any sub-adviser. Such allocation shall be in such amounts and proportions as
the Adviser shall determine and the Adviser will report on said allocations
regularly to the Board of Trustees indicating the brokers to whom such
allocations have been made and the basis therefor.
(d) With respect to the Trust, to the extent the Adviser does not
delegate trading responsibility to one or more sub-advisers, in making
decisions regarding broker-dealer relationships, the Adviser may take into
consideration the recommendations of any sub-adviser appointed to provide
investment research or advisory services in connection with the Trust, and
may take into consideration any research services provided to such
sub-adviser by broker-dealers.
(e) Subject to the other provisions of this Section 8, the 1940 Act, the
Securities Exchange Act of 1934, and rules and regulations thereunder, as
such statutes, rules and regulations are amended from time to time or are
interpreted from time to time by the staff of the SEC, any exemptive orders
issued by the SEC, and any other applicable provisions of law, the Adviser
may select brokers or dealers with which it or the Trust are affiliated.
9. Compensation. The compensation that the Trust shall pay the Adviser is
set forth in Appendix A attached hereto.
10. Expenses of the Trust. All of the ordinary business expenses incurred in
the operations of the Trust and the offering of its shares shall be borne by
the Trust unless specifically provided otherwise in this Agreement. These
expenses borne by the Trust include but are not limited to brokerage
commissions, taxes, legal, accounting, auditing, or governmental fees, the cost
of preparing share certificates, custodian, transfer and shareholder service
agent costs, expenses of issue, sale, redemption and repurchase of shares,
expenses of registering and qualifying shares for sale, expenses relating to
trustees and shareholder meetings, the cost of preparing and distributing
reports and notices to shareholders, the fees and other expenses incurred by
the Trust in connection with membership in investment company organizations and
the cost of printing copies of prospectuses and statements of additional
information distributed to the Trust's shareholders.
11. Services to Other Companies or Accounts. The Trust understands that the
Adviser now acts, will continue to act and may act in the future as investment
manager or adviser to fiduciary and other managed accounts, and as investment
manager or adviser to other investment companies, including any offshore
entities, or accounts, and the Trust has no objection to the Adviser so acting,
provided that whenever the Trust and one or more other investment companies or
accounts managed or advised by the Adviser have available funds for investment,
investments suitable and appropriate for each will be allocated in accordance
with a formula believed to be equitable to each company and account. The Trust
recognizes that in some cases this procedure may adversely affect the size of
the positions obtainable and the prices realized for the Trust.
12. Non-Exclusivity. The Trust understands that the persons employed by the
Adviser to assist in the performance of the Adviser's duties under this
Agreement will not devote their full time to such service and nothing contained
in this Agreement shall be deemed to limit or restrict the right of the Adviser
or any affiliate of the Adviser to engage in and devote time and attention to
other businesses or to render services of whatever kind or nature. The Trust
further understands and agrees that officers or directors of the Adviser may
serve as officers or trustees of the Trust, and that officers or trustees of
the Trust may serve as officers or directors of the Adviser to the extent
permitted by law; and that the officers and directors of the Adviser are not
prohibited from engaging in any other business activity or from rendering
services to any other person, or from serving as partners, officers, directors
or trustees of any other firm or trust, including other investment advisory
companies.
13. Effective Date, Term and Approval. This Agreement shall become effective
with respect to the Trust, if approved by the shareholders of the Trust, on the
date indicated above. If so approved, this Agreement shall
3
<PAGE>
thereafter continue in force and effect until two years after the date
indicated above, and may be continued from year to year thereafter, provided
that the continuation of the Agreement is specifically approved at least
annually:
(a) (i) by the Board of Trustees or (ii) by the vote of "a majority of
the outstanding voting securities" of the Trust (as defined in
Section 2(a)(42) of the 1940 Act); and
(b) by the affirmative vote of a majority of the trustees who are not
parties to this Agreement or "interested persons" (as defined in the 1940
Act) of a party to this Agreement (other than as trustees of the Trust), by
votes cast in person at a meeting specifically called for such purpose.
14. Termination. This Agreement may be terminated as to the Trust at any
time, without the payment of any penalty, by vote of the Board of Trustees or
by vote of a majority of the outstanding voting securities of the Trust, or by
the Adviser, on sixty (60) days' written notice to the other party. The notice
provided for herein may be waived by the party entitled to receipt thereof.
This Agreement shall automatically terminate in the event of its assignment,
the term "assignment" for purposes of this paragraph having the meaning defined
in Section 2(a)(4) of the 1940 Act.
15. Amendment. No amendment of this Agreement shall be effective unless it
is in writing and signed by the party against which enforcement of the
amendment is sought.
16. Liability of Adviser and Trust. In the absence of willful misfeasance,
bad faith, gross negligence or reckless disregard of obligations or duties
hereunder on the part of the Adviser or any of its officers, directors or
employees, the Adviser shall not be subject to liability to the Trust or to the
Funds or to any shareholder of the Trust for any act or omission in the course
of, or connected with, rendering services hereunder or for any losses that may
be sustained in the purchase, holding or sale of any security.
17. Liability of Shareholders. Notice is hereby given that, as provided by
applicable law, the obligations of or arising out of this Agreement are not
binding upon any of the shareholders of the Trust individually but are binding
only upon the assets and property of the Trust and that the shareholders shall
be entitled, to the fullest extent permitted by applicable law, to the same
limitation on personal liability as shareholders of private corporations for
profit.
18. Notices. Any notices under this Agreement shall be in writing, addressed
and delivered, telecopied or mailed postage paid, to the other party entitled
to receipt thereof at such address as such party may designate for the receipt
of such notice. Until further notice to the other party, it is agreed that the
address of the Trust and that of the Adviser shall be 1555 Peachtree Street,
N.E., Atlanta, Georgia 30309.
19. Questions of Interpretation. Any question of interpretation of any term
or provision of this Agreement having a counterpart in or otherwise derived
from a term or provision of the 1940 Act or the Advisers Act shall be resolved
by reference to such term or provision of the 1940 Act or the Advisers Act and
to interpretations thereof, if any, by the United States Courts or in the
absence of any controlling decision of any such court, by rules, regulations or
orders of the SEC issued pursuant to said Acts. In addition, where the effect
of a requirement of the 1940 Act or the Advisers Act reflected in any provision
of the Agreement is revised by rule, regulation or order of the SEC, such
provision shall be deemed to incorporate the effect of such rule, regulation or
order. Subject to the foregoing, this Agreement shall be governed by and
construed in accordance with the laws (without reference to conflicts of law
provisions) of the State of Texas.
20. License Agreement. The Trust shall have the non-exclusive right to use
the name "Invesco" to designate any current or future series of shares only so
long as Invesco Advisers, Inc. serves as investment manager or adviser to the
Trust with respect to such series of shares.
4
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in duplicate by their respective officers on the day and year first
written above.
<TABLE>
<S> <C> <C>
Attest: INVESCO VAN KAMPEN TRUST FOR VALUE MUNICIPALS
/s/ Peter A. Davidson By: /s/ John M. Zerr
----------------------------------------- ----------------------------------------
Assistant Secretary Name: John M. Zerr
Title: Senior Vice President
(SEAL)
Attest: INVESCO ADVISERS, INC.
/s/ Peter A. Davidson By: /s/ John M. Zerr
----------------------------------------- ----------------------------------------
Assistant Secretary Name: John M. Zerr
Title: Senior Vice President
(SEAL)
</TABLE>
5
<PAGE>
APPENDIX A
COMPENSATION TO THE ADVISER
The Trust shall pay the Adviser, out of its assets, as full compensation for
all services rendered, an advisory fee for the Trust set forth below. Such fee
shall be calculated by applying the following annual rates to the average daily
net assets of the Trust for the calendar year.
FUND NAME ADVISORY FEE RATE
--------- -----------------
Invesco Van Kampen Trust for Value
Municipals .55% on managed assets
6
<PAGE>
Sub-Item 77Q1(e)
MASTER INTERGROUP SUB-ADVISORY CONTRACT
This contract is made as of October 15, 2012 by and among Invesco Advisers,
Inc. (the "Adviser") and each of Invesco Canada Ltd., Invesco Asset Management
Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management
(Japan) Limited, Invesco Australia Limited, Invesco Hong Kong Limited, and
Invesco Senior Secured Management, Inc. (each a "Sub-Adviser" and,
collectively, the "Sub-Advisers").
WHEREAS:
A) The Adviser has entered into an investment advisory agreement
with Invesco Van Kampen Trust for Value Municipals (the "Trust"), a
closed-end management investment company registered under the Investment
Company Act of 1940, as amended (the "1940 Act");
B) The Adviser is authorized to delegate certain, any or all of its
rights, duties and obligations under investment advisory agreements to
sub-advisers, including sub-advisers that are affiliated with the Adviser;
C) Each Sub-Adviser represents that it is registered with the
U.S. Securities and Exchange Commission ("SEC") as an investment adviser
under the Investment Advisers Act of 1940 ("Advisers Act") as an investment
adviser, or will be so registered prior to providing any services to the
Trust under this Contract, and engages in the business of acting as an
investment adviser; and
D) The Sub-Advisers and their affiliates have personnel in various
locations throughout the world and have been formed in part for the purpose
of researching and compiling information and recommendations on the
economies of various countries and securities of issuers located in such
countries or on various types of investments and investment techniques, and
providing investment advisory services in connection therewith.
NOW THEREFORE, in consideration of the promises and the mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. Appointment. The Adviser hereby appoints each Sub-Adviser as a
sub-adviser of the Trust for the period and on the terms set forth herein.
Each Sub-Adviser accepts such appointment and agrees to render the services
herein set forth, for the compensation herein provided.
2. Duties as Sub-Adviser. Subject to paragraph 7 below, the Adviser may,
in its discretion, appoint each Sub-Advisor to perform one or more of the
following services with respect to all or a portion of the investments of
the Trust. The services and the portion of the investments of the Trust to
be advised or managed by each Sub-Adviser shall be as agreed upon from time
to time by the Adviser and the Sub-Advisers. Each Sub-Adviser shall pay the
salaries and fees of all personnel of such Sub-Adviser performing services
for the Trust related to research, statistical and investment activities.
(a) Investment Advice. If and to the extent requested by the Adviser,
each Sub-Adviser shall provide investment advice to the Trust and the
Adviser with respect to all or a portion of the investments of the Trust or
with respect to various investment techniques, and in connection with such
advice shall furnish the Trust and the Adviser with such factual
information, research reports and investment recommendations as the Adviser
may reasonably require.
(b) Order Execution. If and to the extent requested by the Adviser, each
Sub-Adviser shall place orders for the purchase and sale of portfolio
securities or other investments for the Trust. In so doing, each Sub-Adviser
agrees that it shall comply with paragraph 3 below.
(c) Discretionary Investment Management. If and to the extent requested
by the Adviser, each Sub-Adviser shall, subject to the supervision of the
Trust's Board of Trustees (the "Board") and the Adviser, manage all or a
portion of the investments of the Trust in accordance with the investment
objectives, policies and limitations provided in the Trust's Registration
Statement and such other limitations as the Trust or the Adviser may impose
with respect to the Trust by notice to the applicable Sub-Adviser(s) and
otherwise in accordance with
<PAGE>
paragraph 5 below. With respect to the portion of the investments of the
Trust under its management, each Sub-Adviser is authorized to: (i) make
investment decisions on behalf of the Trust with regard to any stock, bond,
other security or investment instrument, including but not limited to
foreign currencies, futures, options and other derivatives, and with regard
to borrowing money; (ii) place orders for the purchase and sale of
securities or other investment instruments with such brokers and dealers as
the Sub-Adviser may select; and (iii) upon the request of the Adviser,
provide additional investment management services to the Trust, including
but not limited to managing the Trust's cash and cash equivalents and
lending securities on behalf of the Trust. In selecting brokers or dealers
to execute trades for the Trust, each Sub-Adviser will comply with its
written policies and procedures regarding brokerage and trading, which
policies and procedures shall have been approved by the Board. All
discretionary investment management and any other activities of each
Sub-Adviser shall at all times be subject to the control and direction of
the Adviser and the Board.
3. Broker-Dealer Relationships. Each Sub-Adviser agrees that, in placing
orders with brokers and dealers, it will attempt to obtain the best net
result in terms of price and execution. Consistent with this obligation,
each Sub-Adviser may, in its discretion, purchase and sell portfolio
securities from and to brokers and dealers who sell shares of the Trust or
provide the Trust, the Adviser's other clients, or a Sub-Adviser's other
clients with research, analysis, advice and similar services. Each
Sub-Adviser may pay to brokers and dealers, in return for such research and
analysis, a higher commission or spread than may be charged by other brokers
and dealers, subject to such Sub-Adviser determining in good faith that such
commission or spread is reasonable in terms either of the particular
transaction or of the overall responsibility of the Adviser and such
Sub-Adviser to the Trust and their other clients and that the total
commissions or spreads paid by the Trust will be reasonable in relation to
the benefits to the Trust over the long term. In no instance will portfolio
securities be purchased from or sold to a Sub-Adviser, or any affiliated
person thereof, except in accordance with the applicable securities laws and
the rules and regulations thereunder and any exemptive orders currently in
effect. Whenever a Sub-Adviser simultaneously places orders to purchase or
sell the same security on behalf of the Trust and one or more other accounts
advised by such Sub-Adviser, such orders will be allocated as to price and
amount among all such accounts in a manner believed to be equitable to each
account.
4. Books and Records. Each Sub-Adviser will maintain all required books
and records with respect to the securities transactions of the Trust, and
will furnish the Board and the Adviser with such periodic and special
reports as the Board or the Adviser reasonably may request. Each Sub-Adviser
hereby agrees that all records which it maintains for the Adviser are the
property of the Adviser, and agrees to preserve for the periods prescribed
by applicable law any records which it maintains for the Adviser and which
are required to be maintained, and further agrees to surrender promptly to
the Adviser any records which it maintains for the Adviser upon request by
the Adviser.
5. Further Duties.
(a) In all matters relating to the performance of this Contract, each
Sub-Adviser will act in conformity with the Agreement and Declaration of
Trust, By-Laws and Registration Statement of the Trust and with the
instructions and directions of the Adviser and the Board and will comply
with the requirements of the 1940 Act, the rules, regulations, exemptive
orders and no-action positions thereunder, and all other applicable laws and
regulations.
(b) Each Sub-Adviser shall maintain compliance procedures for the Trust
that it and the Adviser reasonably believe are adequate to ensure compliance
with the federal securities laws (as defined in Rule 38a-1 of the 1940 Act)
and the investment objective(s) and policies as stated in the Trust's
prospectus and statement of additional information. Each Sub-Adviser at its
expense will provide the Adviser or the Trust's Chief Compliance Officer
with such compliance reports relating to its duties under this Contract as
may be requested from time to time. Notwithstanding the foregoing, each
Sub-Adviser will promptly report to the Adviser any material violations of
the federal securities laws (as defined in Rule 38a-1 of the 1940 Act) that
it is or should be aware of or of any material violation of the
Sub-Adviser's compliance policies and procedures that pertain to the Trust.
(c) Each Sub-Adviser at its expense will make available to the Board and
the Adviser at reasonable times its portfolio managers and other appropriate
personnel, either in person or, at the mutual convenience of the Adviser and
the Sub-Adviser, by telephone, in order to review the investment policies,
performance and other investment
2
<PAGE>
related information regarding the Trust and to consult with the Board and
the Adviser regarding the Trust's investment affairs, including economic,
statistical and investment matters related to the Sub-Adviser's duties
hereunder, and will provide periodic reports to the Adviser relating to the
investment strategies it employs. Each Sub-Adviser and its personnel shall
also cooperate fully with counsel and auditors for, and the Chief Compliance
Officer of, the Adviser and the Trust.
(d) Each Sub-Adviser will assist in the fair valuation of portfolio
securities held by the Trust. The Sub-Adviser will use its reasonable
efforts to provide, based upon its own expertise, and to arrange with
parties independent of the Sub-Adviser such as broker-dealers for the
provision of, valuation information or prices for securities for which
prices are deemed by the Adviser or the Trust's administrator not to be
readily available in the ordinary course of business from an automated
pricing service. In addition, each Sub-Adviser will assist the Trust and its
agents in determining whether prices obtained for valuation purposes
accurately reflect market price information relating to the assets of the
Trust at such times as the Adviser shall reasonably request, including but
not limited to, the hours after the close of a securities market and prior
to the daily determination of the Trust's net asset value per share.
(e) Each Sub-Adviser represents and warrants that it has adopted a code
of ethics meeting the requirements of Rule 17j-1 under the 1940 Act and the
requirements of Rule 204A-1 under the Advisers Act and has provided the
Adviser and the Board a copy of such code of ethics, together with evidence
of its adoption, and will promptly provide copies of any changes thereto,
together with evidence of their adoption. Upon request of the Adviser, but
in any event no less frequently than annually, each Sub-Adviser will supply
the Adviser a written report that (A) describes any issues arising under the
code of ethics or procedures since the Sub-Adviser's last report, including
but not limited to material violations of the code of ethics or procedures
and sanctions imposed in response to the material violations; and
(B) certifies that the procedures contained in the Sub-Adviser's code of
ethics are reasonably designed to prevent "access persons" from violating
the code of ethics.
(f) Upon request of the Adviser, each Sub-Adviser will review draft
reports to shareholders and other documents provided or available to it and
provide comments on a timely basis. In addition, each Sub-Adviser and each
officer and portfolio manager thereof designated by the Adviser will provide
on a timely basis such certifications or sub-certifications as the Adviser
may reasonably request in order to support and facilitate certifications
required to be provided by the Trust's Principal Executive Officer and
Principal Financial Officer and will adopt such disclosure controls and
procedures in support of the disclosure controls and procedures adopted by
the Trust as the Adviser, on behalf of the Trust, deems are reasonably
necessary.
(g) Unless otherwise directed by the Adviser or the Board, each
Sub-Adviser will vote all proxies received in accordance with the Adviser's
proxy voting policy or, if the Sub-Adviser has a proxy voting policy
approved by the Board, the Sub-Adviser's proxy voting policy. Each
Sub-Adviser shall maintain and shall forward to the Trust or its designated
agent such proxy voting information as is necessary for the Trust to timely
file proxy voting results in accordance with Rule 30b1-4 of the 1940 Act.
(h) Each Sub-Adviser shall provide the Trust's custodian on each business
day with information relating to all transactions concerning the assets of
the Trust and shall provide the Adviser with such information upon request
of the Adviser.
6. Services Not Exclusive. The services furnished by each Sub-Adviser
hereunder are not to be deemed exclusive and such Sub-Adviser shall be free
to furnish similar services to others so long as its services under this
Contract are not impaired thereby. Nothing in this Contract shall limit or
restrict the right of any director, officer or employee of a Sub-Adviser,
who may also be a Trustee, officer or employee of the Trust, 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
nature or a dissimilar nature.
7. Use of Subsidiaries and Affiliates. Each Sub-Adviser may perform any
or all of the services contemplated hereunder, including but not limited to
providing investment advice to the Trust pursuant to paragraph 2(a) above
and placing orders for the purchase and sale of portfolio securities or
other investments for the Trust pursuant to paragraph 2(b) above, directly
or through such of its subsidiaries or other affiliates, including each of
the other Sub-Advisers, as such Sub-Adviser shall determine; provided,
however, that performance of such services
3
<PAGE>
through such subsidiaries or other affiliates shall have been approved, when
required by the 1940 Act, by (i) a vote of a majority of the independent
Trustees who are not parties to this Contract or "interested persons" (as
defined in the 1940 Act) of a party to this Contract, other than as Board
members ("Independent Trustees"), cast in person at a meeting called for the
purpose of voting on such approval, and/or (ii) a vote of a majority of that
Trust's outstanding voting securities.
8. Compensation.
(a) The only fees payable to the Sub-Advisers under this Contract are for
providing discretionary investment management services pursuant to
paragraph 2(c) above. For such services, the Adviser will pay each
Sub-Adviser a fee, computed daily and paid monthly, equal to (i) 40% of the
monthly compensation that the Adviser receives from the Trust pursuant to
its advisory agreement with the Trust, multiplied by (ii) the fraction equal
to the net assets of the Trust as to which the Sub-Adviser shall have
provided discretionary investment management services pursuant to
paragraph 2(c) above for that month divided by the net assets of the Trust
for that month. This fee shall be payable on or before the last business day
of the next succeeding calendar month. This fee shall be reduced to reflect
contractual or voluntary fee waivers or expense limitations by the Adviser,
if any, in effect from time to time as set forth in paragraph 9 below. In no
event shall the aggregate monthly fees paid to the Sub-Advisers under this
Contract exceed 40% of the monthly compensation that the Adviser receives
from the Trust pursuant to its advisory agreement with the Trust, as reduced
to reflect contractual or voluntary fee waivers or expense limitations by
the Adviser, if any.
(b) If this Contract becomes effective or terminates before the end of
any month, the fees for the period from the effective date to the end of the
month or from the beginning of such month to the date of termination, as the
case may be, shall be prorated according to the proportion which such period
bears to the full month in which such effectiveness or termination occurs.
(c) If a Sub-Adviser provides the services under paragraph 2(c) above to
the Trust for a period that is less than a full month, the fees for such
period shall be prorated according to the proportion which such period bears
to the applicable full month.
9. Fee Waivers and Expense Limitations. If, for any fiscal year of the
Trust, the amount of the advisory fee which such Trust would otherwise be
obligated to pay to the Adviser is reduced because of contractual or
voluntary fee waivers or expense limitations by the Adviser, the fee payable
to each Sub-Adviser pursuant to paragraph 8 above shall be reduced
proportionately; and to the extent that the Adviser reimburses the Trust as
a result of such expense limitations, such Sub-Adviser shall reimburse the
Adviser that proportion of such reimbursement payments which the fee payable
to each Sub-Adviser pursuant to paragraph 8 above bears to the advisory fee
under this Contract.
10. Limitation of Liability of Sub-Adviser and Indemnification. No
Sub-Adviser shall be liable for any costs or liabilities arising from any
error of judgment or mistake of law or any loss suffered by the Trust in
connection with the matters to which this Contract relates except a loss
resulting from willful misfeasance, bad faith or gross negligence on the
part of such Sub-Adviser in the performance by such Sub-Adviser of its
duties or from reckless disregard by such Sub-Adviser of its obligations and
duties under this Contract. Any person, even though also an officer,
partner, employee, or agent of a Sub-Adviser, who may be or become a
Trustee, officer, employee or agent of the Trust, shall be deemed, when
rendering services to the Trust or acting with respect to any business of
the Trust, to be rendering such service to or acting solely for the Trust
and not as an officer, partner, employee, or agent or one under the control
or direction of such Sub-Adviser even though paid by it.
11. Duration and Termination.
(a) This Contract shall become effective with respect to each Sub-Adviser
upon the later of the date hereabove written and the date that such
Sub-Adviser is registered with the SEC as an investment adviser under the
Advisers Act, if a Sub-Adviser is not so registered as of the date hereabove
written; provided, however, that this Contract shall not take effect with
respect to the Trust unless it has first been approved (i) by a vote of a
majority of the Independent Trustees, cast in person at a meeting called for
the purpose of voting on such
4
<PAGE>
approval, and (ii) by vote of a majority of the Trust's outstanding voting
securities, when required by the 1940 Act.
(b) Unless sooner terminated as provided herein, this Contract shall
continue in force and effect until two years after its effective date
determined in 11(a). Thereafter, if not terminated, with respect to each
Fund, this Contract shall continue automatically for successive periods not
to exceed twelve months each, provided that such continuance is specifically
approved at least annually (i) by a vote of a majority of the Independent
Trustees, cast in person at a meeting called for the purpose of voting on
such approval, and (ii) by the Board or by vote of a majority of the
outstanding voting securities of that Fund.
(c) Notwithstanding the foregoing, with respect to the Trust or any
Sub-Adviser(s), this Contract may be terminated at any time, without the
payment of any penalty, (i) by vote of the Board or by a vote of a majority
of the outstanding voting securities of the Trust on sixty days' written
notice to such Sub-Adviser(s); or (ii) by the Adviser on sixty days' written
notice to such Sub-Adviser(s); or (iii) by a Sub-Adviser on sixty days'
written notice to the Trust. Should this Contract be terminated with respect
to a Sub-Adviser, the Adviser shall assume the duties and responsibilities
of such Sub-Adviser unless and until the Adviser appoints another
Sub-Adviser to perform such duties and responsibilities. Termination of this
Contract with respect to one Sub-Adviser(s) shall not affect the continued
effectiveness of this Contract with respect to any remaining Sub-Adviser(s).
This Contract will automatically terminate in the event of its assignment.
12. Amendment. No provision of this Contract may be changed, waived,
discharged or terminated orally, but only by an instrument in writing signed
by the party against which enforcement of the change, waiver, discharge or
termination is sought, and, when required by the 1940 Act, no amendment of
this Contract shall be effective until approved by vote of a majority of the
Trust's outstanding voting securities.
13. Notices. Any notices under this Contract shall be in writing,
addressed and delivered, telecopied or mailed postage paid, to the other
party entitled to receipt thereof at such address as such party may
designate for the receipt of such notice. Until further notice to the other
party, it is agreed that the address of the Trust and that of the Adviser
shall be 1555 Peachtree Street, N.E., Atlanta, Georgia 30309. Until further
notice to the other party, it is agreed that the address of each Sub-Adviser
shall be set forth in Exhibit A attached hereto.
14. Governing Law. This Contract shall be construed in accordance with
the laws of the State of Texas and the 1940 Act. To the extent that the
applicable laws of the State of Texas conflict with the applicable
provisions of the 1940 Act, the latter shall control.
15. Multiple Sub-Advisory Agreements. This Contract has been signed by
multiple parties; namely the Adviser, on one hand, and each Sub-Adviser, on
the other. The parties have signed one document for administrative
convenience to avoid a multiplicity of documents. It is understood and
agreed that this document shall constitute a separate sub-advisory agreement
between the Adviser and each Sub-Adviser with respect to the Trust, as if
the Adviser and such Sub-Adviser had executed a separate sub-advisory
agreement naming such Sub-Adviser as a sub-adviser to the Trust. With
respect to any one Sub-Adviser, (i) references in this Contract to "a
Sub-Adviser" or to "each Sub-Adviser" shall be deemed to refer only to such
Sub-Adviser, and (ii) the term "this Contract" shall be construed according
to the foregoing provisions.
16. Miscellaneous. The captions in this Contract are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. If any
provision of this Contract shall be held or made invalid by a court
decision, statute, rule or otherwise, the remainder of this Contract shall
not be affected thereby. This Contract shall be binding upon and shall inure
to the benefit of the parties hereto and their respective successors. Any
question of interpretation of any term or provision of this Contract having
a counterpart in or otherwise derived from a term or provision of the 1940
Act or the Advisers Act shall be resolved by reference to such term or
provision of the 1940 Act or the Advisers Act and to interpretations
thereof, if any, by the United States Courts or in the absence of any
controlling decision of any such court, by rules, regulations or orders of
the SEC issued pursuant to said Acts. In addition, where the effect of a
requirement of the 1940 Act or the Advisers Act reflected in any provision
of the Contract is revised by rule, regulation or order of the SEC, such
provision shall be deemed to incorporate the effect of such rule, regulation
or order.
5
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Contract to be
executed by their officers designated as of the day and year first above
written.
INVESCO ADVISERS, INC.
Adviser
By: /s/ John M. Zerr
------------------------------
Name: John M. Zerr
Title: Senior Vice President
6
<PAGE>
<TABLE>
<C> <S> <C> <C>
INVESCO ASSET MANAGEMENT INVESCO ASSET MANAGEMENT
DEUTSCHLAND GMBH LIMITED
Sub-Adviser Sub-Adviser
By: /s/ Christian Puschmann /s/ Jens Langewand By: /s/ G. J. Proudfoot
--------------------------------------------------- ----------------------------------------
Name: Christian Puschmann Jens Langewand Name: G. J. Proudfoot
Title: Managing Director Managing Director Title: Director
INVESCO ASSET MANAGEMENT (JAPAN) LIMITED INVESCO AUSTRALIA LIMITED
Sub-Adviser Sub-Adviser
By: /s/ Masakazu Hasegawa By: /s/ Nick Burrell /s/ Mick O'Brien
--------------------------------------------------- ----------------------------------------
Name: Masakazu Hasegawa Name: Nick Burrell Mick O'Brien
Title: Managing Director Title: Co Secretary Chief Executive Officer
INVESCO HONG KONG LIMITED INVESCO SENIOR SECURED MANAGEMENT, INC.
Sub-Adviser Sub-Adviser
By: /s/ Fanny Lee /s/ Gracie Liu By: /s/ Jeffrey H. Kupor
--------------------------------------------------- ----------------------------------------
Name: Fanny Lee Gracie Liu Name: Jeffrey H. Kupor
Title: Director Director Title: Secretary & General Counsel
INVESCO CANADA LTD.
Sub-Adviser
By: /s/ Eric Adelson
---------------------------------------------------
Name: Eric Adelson
Title: Senior Vice President; Head of Legal-Canada; CCO and Secretary
</TABLE>
7
<PAGE>
EXHIBIT A
ADDRESSES OF SUB-ADVISERS
Invesco Asset Management Deutschland GmbH
An der Welle 5, 1st Floor
Frankfurt, Germany 60322
Invesco Asset Management Limited
30 Finsbury Square
London, United Kingdom
EC2A 1AG
ENGLAND
Invesco Asset Management (Japan) Limited
Roppongi Hills Mori Tower 14F
6-10-1 Roppongi, Minato-ku, Tokyo 106-6114
Invesco Australia Limited
333 Collins Street, Level 26
Melbourne Victoria 3000, Australia
Invesco Hong Kong Limited
32nd Floor
Three Pacific Place
1 Queen's Road East
Hong Kong
Invesco Senior Secured Management, Inc.
1166 Avenue of the Americas, 27th Floor
New York, NY 10036
USA
Invesco Canada Ltd.
5140 Yonge Street
Suite 900
Toronto, ON, M2N 6X7
8
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>