0000940400-12-000026.txt : 20120127
0000940400-12-000026.hdr.sgml : 20120127
20120127163848
ACCESSION NUMBER: 0000940400-12-000026
CONFORMED SUBMISSION TYPE: NSAR-B
PUBLIC DOCUMENT COUNT: 3
CONFORMED PERIOD OF REPORT: 20111130
FILED AS OF DATE: 20120127
DATE AS OF CHANGE: 20120127
EFFECTIVENESS DATE: 20120127
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: Flaherty & Crumrine PREFERRED INCOME OPPORTUNITY FUND INC
CENTRAL INDEX KEY: 0000882071
IRS NUMBER: 954355600
STATE OF INCORPORATION: MD
FISCAL YEAR END: 1130
FILING VALUES:
FORM TYPE: NSAR-B
SEC ACT: 1940 Act
SEC FILE NUMBER: 811-06495
FILM NUMBER: 12552283
BUSINESS ADDRESS:
STREET 1: 301 E COLORADO BLVD STE 720
STREET 2: C/O FLAHERTY & CRUMRINE INC
CITY: PASADENA
STATE: CA
ZIP: 91101
BUSINESS PHONE: (626) 795-7300
MAIL ADDRESS:
STREET 1: 301 COLORADO BLVD STE 720
STREET 2: C/O FLAHERTY & CRUMRINE INC
CITY: PASADENA
STATE: CA
ZIP: 91101
FORMER COMPANY:
FORMER CONFORMED NAME: PREFERRED INCOME OPPORTUNITY FUND INC
DATE OF NAME CHANGE: 19920929
NSAR-B
1
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SIGNATURE R. ERIC CHADWICK
TITLE CHIEF FINANCIAL OFFICER
EX-99.77Q1 OTHR EXHB
2
pfo77q1.txt
FLAHERTY & CRUMRINE PREFERRED INCOME OPPORTUNITY FUND
INCORPORATED
AMENDED AND RESTATED BYLAWS
ARTICLE I
NAME OF COMPANY, LOCATION OF OFFICES AND SEAL
Section 1.1. Name. The name of the Company is Flaherty
& Crumrine Preferred Income Opportunity Fund Incorporated.
Section 1.2. Principal Offices. The principal office
of the Company in the State of Maryland shall be located in
Baltimore, Maryland. The Company may, in addition, establish
and maintain such other offices, including a principal
executive office, and places of business within or outside the
State of Maryland as the Board of Directors may from time to
time determine.
Section 1.3. Seal. The corporate seal of the Company
shall be circular in form and shall bear the name of the
Company, the year of its incorporation and the words
"Corporate Seal, Maryland." The form of the seal shall be
subject to alteration by the Board of Directors and the seal
may be used by causing it or a facsimile to be impressed or
affixed or printed or otherwise reproduced. Any Officer or
Director of the Company shall have authority to affix the
corporate seal of the Company to any document requiring the
same.
ARTICLE II
STOCKHOLDERS
Section 2.1. Place of Meetings. All meetings of the
Stockholders shall be held at such place, whether within or
outside the State of Maryland, as the Board of Directors shall
determine, which shall be stated in the notice of the meeting
or in a duly executed waiver of notice thereof.
Section 2.2. Annual Meeting. The annual meeting of the
Stockholders of the Company shall be held on the date and at
such time and place as the Board of Directors shall determine
in its discretion, at which time the Stockholders shall elect
Directors and transact such other business as may properly
come before the meeting. Any business of the Company may be
transacted at the annual meeting without being specially
designated in the notice except as otherwise provided by
statute, by the charter of the Company (the "Charter") or by
these Bylaws.
Section 2.3. Special Meetings.
(a) General. The Chairman of the Board, the Chief
Executive Officer, the President or the Board of Directors may
call a special meeting of the Stockholders. Subject to
subsection (b) of this Section 2.3, a special meeting of
Stockholders shall also be called by the Secretary of the
Company to act on any matter that may properly be considered
at a meeting of Stockholders upon the written request of
Stockholders entitled to cast not less than a majority of all
the votes entitled to be cast on such matter at such meeting.
Subject to subsection (b) of this Section 2.3, any special
meeting shall be held at such place, date and time as may be
designated by the Chairman of the Board, the Chief Executive
Officer, the President or the Board of Directors, whoever
shall have called the meeting. In fixing a date for any
special meeting, the Chairman of the Board, the Chief
Executive Officer, the President or the Board of Directors may
consider such factors as he, she or it deems relevant,
including, without limitation, the nature of the matters to be
considered, the facts and circumstances surrounding any
request for the meeting and any plan of the Board of Directors
to call an annual meeting or a special meeting.
(b) Stockholder Requested Special Meetings. (1) Any
Stockholder of record seeking to have Stockholders request a
special meeting shall, by sending written notice to the
Secretary (the "Record Date Request Notice") by registered
mail, return receipt requested, request the Board of Directors
to fix a record date to determine the Stockholders entitled to
request a special meeting (the "Request Record Date"). The
Record Date Request Notice shall set forth the purpose of the
meeting and the matters proposed to be acted on at it, shall
be signed by one or more Stockholders of record as of the date
of signature (or their agents duly authorized in a writing
accompanying the Record Date Request Notice), shall bear the
date of signature of each such Stockholder (or such agent) and
shall set forth all information relating to each such
Stockholder and each matter proposed to be acted on at the
meeting that would be required to be disclosed in connection
with the solicitation of proxies for election of Directors in
an election contest (even if an election contest is not
involved), or would otherwise be required in connection with
such a solicitation, in each case pursuant to Regulation 14A
(or any successor provision) under the Securities Exchange Act
of 1934, as amended, and the rules and regulations promulgated
thereunder (the "Exchange Act"). Upon receiving the Record
Date Request Notice, the Board of Directors may fix a Request
Record Date. The Request Record Date shall not precede and
shall not be more than ten days after the close of business on
the date on which the resolution fixing the Request Record
Date is adopted by the Board of Directors. If the Board of
Directors, within ten days after the date on which a valid
Record Date Request Notice is received, fails to adopt a
resolution fixing the Request Record Date, the Request Record
Date shall be the close of business on the tenth day after the
first date on which a Record Date Request Notice is received
by the Secretary.
(2) In order for any Stockholder to request a
special meeting to act on any matter that may properly be
considered at a meeting of Stockholders, one or more written
requests for a special meeting (collectively, the "Special
Meeting Request") signed by Stockholders of record (or their
agents duly authorized in a writing accompanying the request)
as of the Request Record Date entitled to cast not less than a
majority of all of the votes entitled to be cast on such
matter at such meeting (the "Special Meeting Percentage")
shall be delivered to the Secretary. In addition, the Special
Meeting Request shall (a) set forth the purpose of the meeting
and the matters proposed to be acted on at it (which shall be
limited to those lawful matters set forth in the Record Date
Request Notice received by the Secretary), (b) bear the date
of signature of each such Stockholder (or such agent) signing
the Special Meeting Request, (c) set forth (i) the name and
address, as they appear in the Company's books, of each
Stockholder signing such request (or on whose behalf the
Special Meeting Request is signed), (ii) the class, series and
number of all shares of stock of the Company which are owned
(beneficially or of record) by each such Stockholder and (iii)
the nominee holder for, and number of, shares of stock of the
Company owned beneficially but not of record by such
Stockholder, (d) be sent to the Secretary by registered mail,
return receipt requested, and (e) be received by the Secretary
within 60 days after the Request Record Date. Any requesting
Stockholder (or agent duly authorized in a writing
accompanying the revocation of the Special Meeting Request)
may revoke his, her or its request for a special meeting at
any time by written revocation delivered to the Secretary.
(3) The Secretary shall inform the requesting
Stockholders of the reasonably estimated cost of preparing and
mailing or delivering the notice of the meeting (including the
Company's proxy materials). The Secretary shall not be
required to call a special meeting upon Stockholder request
and such meeting shall not be held unless, in addition to the
documents required by paragraph (2) of this Section 2.3(b),
the Secretary receives payment of such reasonably estimated
cost prior to the preparation and mailing or delivery of such
notice of the meeting.
(4) In the case of any special meeting called by the
Secretary upon the request of Stockholders (a "Stockholder-
Requested Meeting"), such meeting shall be held at such place,
date and time as may be designated by the Board of Directors;
provided, however, that the date of any Stockholder-Requested
Meeting shall be not more than 90 days after the record date
for such meeting (the "Meeting Record Date"); and provided
further that if the Board of Directors fails to designate,
within ten days after the date that a valid Special Meeting
Request is actually received by the Secretary (the "Delivery
Date"), a date and time for a Stockholder-Requested Meeting,
then such meeting shall be held at 2:00 p.m. local time on the
90th day after the Meeting Record Date or, if such 90th day is
not a Business Day (as defined below), on the first preceding
Business Day; and provided further that in the event that the
Board of Directors fails to designate a place for a
Stockholder-Requested Meeting within ten days after the
Delivery Date, then such meeting shall be held at the
principal executive office of the Company. In the case of any
Stockholder-Requested Meeting, if the Board of Directors fails
to fix a Meeting Record Date that is a date within 30 days
after the Delivery Date, then the close of business on the
30th day after the Delivery Date shall be the Meeting Record
Date. The Board of Directors may revoke the notice for any
Stockholder-Requested Meeting in the event that the requesting
Stockholders fail to comply with the provisions of paragraph
(3) of this Section 2.3(b).
(5) If written revocations of the Special Meeting
Request have been delivered to the Secretary and the result is
that Stockholders of record (or their agents duly authorized
in writing), as of the Request Record Date, entitled to cast
less than the Special Meeting Percentage have delivered, and
not revoked, requests for a special meeting on the matter to
the Secretary: (i) if the notice of meeting has not already
been delivered, the Secretary shall refrain from delivering
the notice of the meeting and send to all requesting
Stockholders who have not revoked such requests written notice
of any revocation of a request for a special meeting on the
matter, or (ii) if the notice of meeting has been delivered
and if the Secretary first sends to all requesting
Stockholders who have not revoked requests for a special
meeting on the matter written notice of any revocation of a
request for the special meeting and written notice of the
Company's intention to revoke the notice of the meeting or for
the chairman of the meeting to adjourn the meeting without
action on the matter, (A) the Secretary may revoke the notice
of the meeting at any time before ten days before the
commencement of the meeting or (B) the chairman of the meeting
may call the meeting to order and adjourn the meeting without
acting on the matter. Any request for a special meeting
received after a revocation by the Secretary of a notice of a
meeting shall be considered a request for a new special
meeting.
(6) The Board of Directors, the Chairman of the
Board, the Chief Executive Officer or the President may
appoint regionally or nationally recognized independent
inspectors of elections to act as the agent of the Company for
the purpose of promptly performing a ministerial review of the
validity of any purported Special Meeting Request received by
the Secretary. For the purpose of permitting the inspectors to
perform such review, no such purported Special Meeting Request
shall be deemed to have been delivered to the Secretary until
the earlier of (i) five Business Days after receipt by the
Secretary of such purported request and (ii) such date as the
independent inspectors certify to the Company that the valid
requests received by the Secretary represent, as of the
Request Record Date, Stockholders of record entitled to cast
not less than the Special Meeting Percentage. Nothing
contained in this paragraph (6) shall in any way be construed
to suggest or imply that the Company or any Stockholder shall
not be entitled to contest the validity of any request,
whether during or after such five Business Day period, or to
take any other action (including, without limitation, the
commencement, prosecution or defense of any litigation with
respect thereto, and the seeking of injunctive relief in such
litigation).
(7) For purposes of these Bylaws, "Business Day"
shall mean any day other than a Saturday, a Sunday or a day on
which banking institutions in the State of New York are
authorized or obligated by law or executive order to close.
Section 2.4. Notice. Not less than ten nor more than 90
days before each meeting of Stockholders, the Secretary shall
give to each Stockholder entitled to vote at such meeting and
to each Stockholder not entitled to vote who is entitled to
notice of the meeting notice in writing or by electronic
transmission stating the time and place of the meeting and, in
the case of a special meeting or as otherwise may be required
by any statute, the purpose for which the meeting is called.
Notice may be delivered by mail, by presenting it to such
Stockholder personally, by leaving it at the Stockholder's
residence or usual place of business, by electronic means, or
by any other means permitted by Maryland law. If mailed, such
notice shall be deemed to be given when deposited in the
United States mail addressed to the Stockholder at the
Stockholder's address as it appears on the records of the
Company, with postage thereon prepaid. If transmitted
electronically, such notice shall be deemed to be given when
transmitted to the Stockholder by an electronic transmission
to any address or number of the Stockholder at which the
Stockholder receives electronic transmissions. The Corporation
may give a single notice to all Stockholders who share an
address, which single notice shall be effective as to any
Stockholder at such address, unless a Stockholder objects to
receiving such single notice or revokes a prior consent to
receiving such single notice. Failure to give notice of any
meeting to one or more Stockholders, or any irregularity in
such notice, shall not affect the validity of any meeting
fixed in accordance with this Article II or the validity of
any proceedings at any such meeting.
Subject to Section 2.5(a) of this Article II, any
business of the Company may be transacted at an annual meeting
of Stockholders without being specifically designated in the
notice, except such business as is required by any statute to
be stated in such notice. No business shall be transacted at a
special meeting of Stockholders except as specifically
designated in the notice. The Corporation may postpone or
cancel a meeting of Stockholders by making a public
announcement (as defined in Section 2.5(c)(3) of this Article
II) of such postponement or cancellation prior to the meeting.
Notice of the date, time and place to which the meeting is
postponed shall be given not less than ten days prior to such
date and otherwise in the manner set forth in this section.
Section 2.5. Advance Notice of Stockholder Nominees for
Director and Other Stockholder Proposals.
(a) Annual Meetings of Stockholders. (1)
Nominations of individuals for election to the Board of
Directors and the proposal of other business to be considered
by the Stockholders may be made at an annual meeting of
Stockholders (i) pursuant to the Company's notice of meeting,
(ii) by or at the direction of the Board of Directors or (iii)
by any Stockholder of the Company who was a Stockholder of
record both at the time of giving of notice by the Stockholder
as provided for in this Section 2.5(a) and at the time of the
annual meeting, who is entitled to vote at the meeting in the
election of each individual so nominated or on any such other
business and who has complied with this Section 2.5(a).
(2) For any nomination or other business to be
properly brought before an annual meeting by a Stockholder
pursuant to clause (iii) of paragraph (a)(1) of this Section
2.5, the Stockholder must have given timely notice thereof in
writing to the Secretary of the Company and, in the case of
any such other business, such other business must otherwise be
a proper matter for action by the Stockholders. To be timely,
a Stockholder's notice shall set forth all information
required under this Section 2.5 and shall be delivered to the
Secretary at the principal executive office of the Company not
earlier than 9:00 a.m. on the 150th day nor later than 5:00
p.m., Eastern Time, on the 120th day prior to the first
anniversary of the date of the proxy statement (as defined in
Section 2.5(c)(3)) for the preceding year's annual meeting;
provided, however, that in the event that the date of the
annual meeting is advanced or delayed by more than 30 days
from the first anniversary of the date of the preceding year's
annual meeting, notice by the Stockholder to be timely must be
so delivered not earlier than the 150th day prior to the date
of such annual meeting and not later than 5:00 p.m., Eastern
Time, on the later of the 120th day prior to the date of such
annual meeting, as originally convened, or the tenth day
following the day on which public announcement of the date of
such meeting is first made. The public announcement of a
postponement or adjournment of an annual meeting shall not
commence a new time period for the giving of a Stockholder's
notice as described above.
(3) Such Stockholder's notice shall set forth:
(i) as to each individual whom the
Stockholder proposes to nominate for election or reelection as
a Director (each, a "Proposed Nominee"),
(A) all information relating to the
Proposed Nominee that would be required to be disclosed in
connection with the solicitation of proxies for the election
of the Proposed Nominee as a Director in an election contest
(even if an election contest is not involved), or would
otherwise be required in connection with such solicitation, in
each case pursuant to Regulation 14A (or any successor
provision) under the Exchange Act and the rules thereunder;
and
(B) whether such Stockholder believes
any such Proposed Nominee is, or is not, an "interested
person" of the Company, as defined in the Investment Company
Act of 1940, as amended, and the rules promulgated thereunder
(the "Investment Company Act") and information regarding such
individual that is sufficient, in the discretion of the Board
of Directors or any committee thereof or any authorized
Officer of the Company, to make such determination;
(ii) as to any business that the
Stockholder proposes to bring before the meeting, a
description of such business, the Stockholder's reasons for
proposing such business at the meeting and any material
interest in such business of such Stockholder or any
Stockholder Associated Person (as defined below), individually
or in the aggregate, including any anticipated benefit to the
Stockholder or the Stockholder Associated Person therefrom;
(iii) as to the Stockholder giving the
notice, any Proposed Nominee and any Stockholder Associated
Person,
(A) the class, series and number of
all shares of stock or other securities of the Company or any
affiliate thereof (collectively, the "Company Securities"), if
any, which are owned (beneficially or of record) by such
Stockholder, Proposed Nominee or Stockholder Associated
Person, the date on which each such Company Security was
acquired and the investment intent of such acquisition, and
any short interest (including any opportunity to profit or
share in any benefit from any decrease in the price of such
stock or other security) in any Company Securities of any such
person;
(B) the nominee holder for, and
number of, any Company Securities owned beneficially but not
of record by such Stockholder, Proposed Nominee or Stockholder
Associated Person;
(C) whether and the extent to which
such Stockholder, Proposed Nominee or Stockholder Associated
Person, directly or indirectly (through brokers, nominees or
otherwise), is subject to or during the last twelve months has
engaged in any hedging, derivative or other transaction or
series of transactions or entered into any other agreement,
arrangement or understanding (including any short interest,
any borrowing or lending of securities or any proxy or voting
agreement), the effect or intent of which is to (I) manage
risk or benefit of changes in the price of (x) Company
Securities or (y) any security of any other closed-end
investment company (a "Peer Group Company") for such
Stockholder, Proposed Nominee or Stockholder Associated Person
or (II) increase or decrease the voting power of such
Stockholder, Proposed Nominee or Stockholder Associated Person
in the Company or any affiliate thereof (or, as applicable, in
any Peer Group Company) disproportionately to such person's
economic interest in the Company Securities (or, as
applicable, in any Peer Group Company); and
(D) any substantial interest, direct
or indirect (including, without limitation, any existing or
prospective commercial, business or contractual relationship
with the Company), by security holdings or otherwise, of such
Stockholder, Proposed Nominee or Stockholder Associated
Person, in the Company or any affiliate thereof, other than an
interest arising from the ownership of Company Securities
where such Stockholder, Proposed Nominee or Stockholder
Associated Person receives no extra or special benefit not
shared on a pro rata basis by all other holders of the same
class or series;
(iv) as to the Stockholder giving the
notice, any Stockholder Associated Person with an interest or
ownership referred to in clauses (ii) or (iii) of this
paragraph (3) of this Section 2.5(a) and any Proposed Nominee,
(A) the name and address of such
Stockholder, as they appear on the Company's stock ledger, and
the current name and business address, if different, of each
such Stockholder Associated Person and any Proposed Nominee
and
(B) the investment strategy or
objective, if any, of such Stockholder and each such
Stockholder Associated Person who is not an individual and a
copy of the prospectus, offering memorandum or similar
document, if any, provided to investors or potential investors
in such Stockholder and each such Stockholder Associated
Person; and
(v) to the extent known by the Stockholder
giving the notice, the name and address of any other
Stockholder supporting the Proposed Nominee for election or
reelection as a Director or the proposal of other business on
the date of such Stockholder's notice.
(4) Such Stockholder's notice shall, with
respect to any Proposed Nominee, be accompanied by a
certificate executed by the Proposed Nominee (i) certifying
that such Proposed Nominee (a) is not, and will not become a
party to, any agreement, arrangement or understanding with any
person or entity other than the Company in connection with
service or action as a Director that has not been disclosed to
the Company and (b) will serve as a Director of the Company if
elected; and (ii) attaching a completed Proposed Nominee
questionnaire (which questionnaire shall be provided by the
Company, upon request, to the Stockholder providing the notice
and shall include all information relating to the Proposed
Nominee that would be required to be disclosed in connection
with the solicitation of proxies for the election of the
Proposed Nominee as a Director in an election contest (even if
an election contest is not involved), or would otherwise be
required in connection with such solicitation, in each case
pursuant to Regulation 14A (or any successor provision) under
the Exchange Act and the rules thereunder, or would be
required pursuant to the rules of any national securities
exchange or over-the-counter market).
(5) Notwithstanding anything in this subsection
(a) of this Section 2.5 to the contrary, in the event that the
number of Directors to be elected to the Board of Directors is
increased, and there is no public announcement of such action
at least 130 days prior to the first anniversary of the date
of the proxy statement (as defined in Section 2.5(c)(3)) for
the preceding year's annual meeting, a Stockholder's notice
required by this Section 2.5(a) shall also be considered
timely, but only with respect to nominees for any new
positions created by such increase, if it shall be delivered
to the Secretary at the principal executive office of the
Company not later than 5:00 p.m., Eastern Time, on the tenth
day following the day on which such public announcement is
first made by the Company.
(6) For purposes of this Section 2.5,
"Stockholder Associated Person" of any stockholder means (i)
any person acting in concert with such Stockholder, (ii) any
beneficial owner of shares of stock of the Company owned of
record or beneficially by such Stockholder (other than a
Stockholder that is a depositary) and (iii) any person that
directly, or indirectly through one or more intermediaries,
controls, or is controlled by, or is under common control
with, such Stockholder or such Stockholder Associated Person
or is an officer, director, partner, member, employee or agent
of such Stockholder or such Stockholder Associated Person.
(b) Special Meetings of Stockholders. Only such
business shall be conducted at a special meeting of
Stockholders as shall have been brought before the meeting
pursuant to the Company's notice of meeting. Nominations of
individuals for election to the Board of Directors may be made
at a special meeting of Stockholders at which Directors are to
be elected only (i) by or at the direction of the Board of
Directors or (ii) provided that the special meeting has been
called in accordance with Section 2.3 of this Article II for
the purpose of electing Directors, by any Stockholder of the
Company who is a Stockholder of record both at the time of
giving of notice provided for in this Section 2.5 and at the
time of the special meeting, who is entitled to vote at the
meeting in the election of each individual so nominated and
who has complied with the notice procedures set forth in this
Section 2.5. In the event the Company calls a special meeting
of Stockholders for the purpose of electing one or more
individuals to the Board of Directors, any such Stockholder
may nominate an individual or individuals (as the case may be)
for election as a Director as specified in the Company's
notice of meeting, if the Stockholder's notice, containing the
information required by paragraph (a)(3) of this Section 2 5
shall be delivered to the Secretary at the principal executive
office of the Company not earlier than the 120th day prior to
such special meeting and not later than 5:00 p.m., Eastern
Time, on the later of the 90th day prior to such special
meeting or the tenth day following the day on which public
announcement is first made of the date of the special meeting
and of the nominees proposed by the Board of Directors to be
elected at such meeting. The public announcement of a
postponement or adjournment of a special meeting shall not
commence a new time period for the giving of a Stockholder's
notice as described above.
(c) General. (1) If information submitted pursuant
to this Section 2.5 by any Stockholder proposing a nominee for
election as a Director or any proposal for other business at a
meeting of Stockholders shall be inaccurate in any material
respect, such information may be deemed not to have been
provided in accordance with this Section 2.5. Any such
Stockholder shall notify the Company of any inaccuracy or
change (within two Business Days of becoming aware of such
inaccuracy or change) in any such information. Upon written
request by the Secretary of the Company or the Board of
Directors, any such Stockholder shall provide, within five
Business Days of delivery of such request (or such other
period as may be specified in such request), (A) written
verification, satisfactory, in the discretion of the Board of
Directors or any authorized Officer of the Company, to
demonstrate the accuracy of any information submitted by the
Stockholder pursuant to this Section 2.5, and (B) a written
update of any information (including, if requested by the
Company, written confirmation by such Stockholder that it
continues to intend to bring such nomination or other business
proposal before the meeting) submitted by the Stockholder
pursuant to this Section 2.5 as of an earlier date. If a
Stockholder fails to provide such written verification or
written update within such period, the information as to which
written verification or a written update was requested may be
deemed not to have been provided in accordance with this
Section 2.5.
(2) Only such individuals who are nominated in
accordance with this Section 2.5 shall be eligible for
election by Stockholders as Directors, and only such business
shall be conducted at a meeting of Stockholders as shall have
been brought before the meeting in accordance with this
Section 2.5. The chairman of the meeting shall have the power
to determine whether a nomination or any other business
proposed to be brought before the meeting was made or
proposed, as the case may be, in accordance with this Section
2.5.
(3) For purposes of this Section 2.5, "the date
of the proxy statement" shall have the same meaning as "the
date of the company's proxy statement released to
shareholders" as used in Rule 14a-8(e) promulgated under the
Exchange Act, as interpreted by the Securities and Exchange
Commission from time to time. "Public announcement" shall mean
disclosure (i) in a press release reported by the Dow Jones
News Service, Associated Press, Business Wire, PR Newswire or
other widely circulated news or wire service or (ii) in a
document publicly filed by the Company with the Securities and
Exchange Commission pursuant to the Exchange Act or the
Investment Company Act.
(4) Notwithstanding the foregoing provisions of
this Section 2.5, a Stockholder shall also comply with all
applicable requirements of state law and of the Exchange Act
and the rules and regulations thereunder with respect to the
matters set forth in this Section 2.5. Nothing in this Section
2 5 shall be deemed to affect any right of a Stockholder to
request inclusion of a proposal in, or the right of the
Company to omit a proposal from, the Company's proxy statement
pursuant to Rule 14a-8 (or any successor provision) under the
Exchange Act. Nothing in this Section 2 5 shall require
disclosure of revocable proxies received by the Stockholder or
Stockholder Associated Person pursuant to a solicitation of
proxies after the filing of an effective Schedule 14A by such
Stockholder or Stockholder Associated Person under Section
14(a) of the Exchange Act.
Section 2.6. Quorum. At any meeting of Stockholders,
the presence in person or by proxy of Stockholders entitled to
cast a majority of all the votes entitled to be cast at such
meeting on any matter shall constitute a quorum; but this
section shall not affect any requirement under any statute or
the charter of the Company for the vote necessary for the
approval of any matter. If such quorum is not established at
any meeting of the Stockholders, the chairman of the meeting
may adjourn the meeting sine die or from time to time to a
date not more than 120 days after the original record date
without notice other than announcement at the meeting. At such
adjourned meeting at which a quorum shall be present, any
business may be transacted which might have been transacted at
the meeting as originally notified.
The Stockholders present either in person or by proxy, at
a meeting which has been duly called and at which a quorum has
been established, may continue to transact business until
adjournment, notwithstanding the withdrawal from the meeting
of enough Stockholders to leave fewer than would be required
to establish a quorum.
Section 2.7. Voting. A plurality of all the votes cast
at a meeting of Stockholders duly called and at which a quorum
is present shall be sufficient to elect a Director. Each share
may be voted for as many individuals as there are Directors to
be elected and for whose election the share is entitled to be
voted. A majority of the votes cast at a meeting of
Stockholders duly called and at which a quorum is present
shall be sufficient to approve any other matter which may
properly come before the meeting, unless a different vote is
required by statute or by the Charter.
Section 2.8. Voting Rights of Stockholders. Unless
otherwise provided by statute or in the Charter, each
Stockholder of record having the right to vote shall be
entitled at every meeting of the Stockholders of the Company
to one vote for each share of stock having voting power
standing in the name of such Stockholder on the books of the
Company on the record date fixed in accordance with Section
6.5 of these Bylaws, with pro rata voting rights for any
fractional shares, and such votes may be cast either in person
or by proxy, by any means permitted by law.
Section 2.9. Organization and Conduct. Every meeting of
Stockholders shall be conducted by an individual appointed by
the Board of Directors to be chairman of the meeting or, in
the absence of such appointment or appointed individual, by
the Chairman of the Board, if any, or, in the case of a
vacancy in the office or absence of the Chairman of the Board,
by one of the following Officers present at the meeting in the
following order: the Vice Chairman of the Board, if any, the
Chief Executive Officer, the President, any Vice Presidents in
order of their rank and seniority, the Secretary, the
Treasurer or, in the absence of such Officers, a chairman
chosen by the Stockholders by the vote of a majority of the
votes cast by Stockholders present in person or by proxy. The
Secretary, or, in the Secretary's absence, an Assistant
Secretary, or, in the absence of both the Secretary and
Assistant Secretaries, an individual appointed by the Board of
Directors or, in the absence of such appointment, an
individual appointed by the chairman of the meeting shall act
as secretary. In the event that the Secretary presides at a
meeting of the Stockholders, an Assistant Secretary, or, in
the absence of Assistant Secretaries, an individual appointed
by the Board of Directors or the chairman of the meeting,
shall record the minutes of the meeting. The order of business
and all other matters of procedure at any meeting of
Stockholders shall be determined by the chairman of the
meeting. The chairman of the meeting may prescribe such rules,
regulations and procedures and take such action as, in the
discretion of such chairman and without any action by the
Stockholders, are appropriate for the proper conduct of the
meeting, including, without limitation, (a) restricting
admission to the time set for the commencement of the meeting;
(b) limiting attendance at the meeting to Stockholders of
record of the Company, their duly authorized proxies and other
such individuals as the chairman of the meeting may determine;
(c) limiting participation at the meeting on any matter to
Stockholders of record of the Company entitled to vote on such
matter, their duly authorized proxies and other such
individuals as the chairman of the meeting may determine; (d)
limiting the time allotted to questions or comments; (e)
determining when and for how long the polls should be open and
when the polls should be closed; (f) maintaining order and
security at the meeting; (g) removing any Stockholder or any
other individual who refuses to comply with meeting
procedures, rules or guidelines as set forth by the chairman
of the meeting; (h) concluding a meeting or recessing or
adjourning the meeting to a later date and time and at a place
announced at the meeting; and (i) complying with any state and
local laws and regulations concerning safety and security.
Unless otherwise determined by the chairman of the meeting,
meetings of Stockholders shall not be required to be held in
accordance with the rules of parliamentary procedure.
Section 2.10. Proxies. Each Stockholder entitled to vote
at any meeting of Stockholders may authorize another person to
act as proxy for the Stockholder by (a) signing a writing
authorizing another person to act as proxy, (b) transmitting
an authorization for a person or persons to act as proxy to
either (i) the person or persons authorized to act as proxy or
(ii) any other person authorized to receive the proxy
authorization on behalf of the person or persons authorized to
act as proxy or (c) any other means permitted by law. Signing
of a writing may be accomplished by the Stockholder or the
Stockholder's authorized agent signing the writing or causing
the Stockholder's signature to be affixed to the writing by
any reasonable means, including facsimile signature. An
authorization of a person or persons to serve as proxy may be
transmitted by any means permitted by law, including telegram,
datagram, electronic mail or any other electronic or
telephonic means. No proxy shall be valid after the expiration
of eleven months from its date unless it provides otherwise.
Unless a proxy provides otherwise, every proxy shall be
revocable prior to its exercise at the pleasure of the person
authorizing it or of his or her personal representatives or
assigns. Proxies shall be delivered prior to the meeting to
the Secretary of the Company or to the person acting as
Secretary of the meeting before being exercised. A proxy with
respect to stock held in the name of two or more persons shall
be valid if authorized by one of them unless, at or prior to
exercise of such proxy, the Company receives a specific
written notice to the contrary from any one of them. A proxy
purporting to be authorized by or on behalf of a Stockholder
shall be deemed valid unless challenged at or prior to its
exercise.
Section 2.11. Action without Meeting. Any action to be
taken by holders of Common Stock, or of Common Stock and
Preferred Stock (and any other class of stock) voting together
as a single class, may be taken without a meeting if (i) all
Stockholders entitled to vote on the matter consent to the
action in writing, and (ii) such consents are filed with the
records of the meetings of Stockholders. Except as provided
above, the holders of Preferred Stock and of any other class
of stock (other than Common Stock entitled to vote generally
in the election of Directors) may take action or consent to
any action by the written consent of the holders of the
Preferred Stock and/or such other class of stock entitled to
cast not less than the minimum number of votes that would be
necessary to authorize or take the action at a Stockholders'
meeting if the Company gives notice of the action to each
Stockholder of the Company not later than 10 days after the
effective time of the action. A consent shall be treated for
all purposes as a vote at a meeting.
Section 2.12. Inspectors. The Board of Directors or the
chairman of the meeting may appoint, before or at the meeting,
one or more inspectors for the meeting and any successor to
the inspector. Except as otherwise provided by the chairman of
the meeting, the inspectors, if any, shall (i) determine the
number of shares of stock represented at the meeting, in
person or by proxy, and the validity and effect of proxies,
(ii) receive and tabulate all votes, ballots or consents,
(iii) report such tabulation to the chairman of the meeting,
(iv) hear and determine all challenges and questions arising
in connection with the right to vote, and (v) do such acts as
are proper to fairly conduct the election or vote. Each such
report shall be in writing and signed by the inspector or by a
majority of them if there is more than one inspector acting at
such meeting. If there is more than one inspector, the report
of a majority shall be the report of the inspectors. The
report of the inspector or inspectors on the number of shares
represented at the meeting and the results of the voting shall
be prima facie evidence thereof.
ARTICLE III
BOARD OF DIRECTORS
Section 3.1. General Powers. Except as otherwise
provided in the Charter, the business and affairs of the
Company shall be managed under the direction of the Board of
Directors. All powers of the Company may be exercised by or
under authority of the Board of Directors except as conferred
on or reserved to the Stockholders by law, by the Charter or
by these Bylaws.
Section 3.2. Board of Three to 12 Directors. The Board
of Directors shall consist of not less than three nor more
than 12 Directors; provided that if there are less than three
Stockholders, the number of Directors may be the same number
as the number of Stockholders but not less than one. Directors
need not be Stockholders. The Directors shall have power from
time to time, to increase or decrease the number of Directors
by vote of a majority of the entire Board of Directors. If the
number of Directors is increased, the additional Directors may
be elected by a majority of the Directors in office at the
time of the increase. If such additional Directors are not so
elected by the Directors in office at the time they increase
the number of places on the Board, or if the additional
Directors are elected by the existing Directors prior to the
first meeting of the Stockholders of the Company, then in
either of such events the additional Directors shall be
elected or re-elected by the Stockholders at their next annual
meeting or at an earlier special meeting called for that
purpose.
Beginning with the first annual meeting of Stockholders
held after the initial public offering of the shares of the
Company (the "initial annual meeting"), the Board of Directors
shall be divided into three classes: Class I, Class II and
Class III. The terms of office of the classes of Directors
elected at the initial annual meeting shall expire at the
times of the annual meetings of the Stockholders as follows:
Class I on the next annual meeting, Class II on the second
next annual meeting and Class III on the third next annual
meeting, or thereafter in each case when their respective
successors are elected and qualified. At each subsequent
annual election, the Directors chosen to succeed those whose
terms are expiring shall be identified as being of the same
class as the Directors whom they succeed, and shall be elected
for a term expiring at the time of the third succeeding annual
meeting of Stockholders, or thereafter in each case when their
respective successors are elected and qualified. If the
Company issues Preferred Stock entitling the holders to elect
additional Directors in special circumstances and those
special circumstances arise, then the number of Directors that
the holders of the Common Stock are entitled to elect shall be
reduced to a number such that, when the requisite number of
Directors has been elected by Preferred Stockholders, the
total number of Directors shall not exceed 12 in number.
Section 3.3. Vacancies. Subject to the provisions of
the Investment Company Act, if the office of any Director or
Directors becomes vacant for any reason (other than an
increase in the number of Directors), the Directors in office,
although less than a quorum, shall continue to act and may
elect a successor or successors, who shall hold office for the
remainder of the full term of the class of Directors in which
the vacancy occurred and until a successor is elected and
qualifies.
Section 3.4. Removal. As provided in the Charter, at
any meeting of Stockholders duly called and at which a quorum
is present, the Stockholders may, by the affirmative vote of
the holders of at least 80% of the votes entitled to be cast
for election of the Director's successor, remove any Director
or Directors from office, with or without cause.
Section 3.5. Resignation. A Director may resign at any
time by giving written notice of his or her resignation to the
Board of Directors or the Chairman or the Vice Chairman, if
any, of the Board or the Secretary of the Company. Any
resignation shall take effect immediately upon its receipt or
at such later time specified in the resignation. Acceptance of
a resignation shall not be necessary to make it effective,
unless the resignation states otherwise.
Section 3.6. Place of Meetings. The Directors may hold
their meetings at the principal office of the Company or at
such other places, either within or outside the State of
Maryland, as they may from time to time determine
Section 3.7. Regular Meetings. Regular meetings of the
Board may be held at such date and time as shall from time to
time be determined by resolution of the Board.
Section 3.8. Special Meetings. Special meetings of the
Board may be called by order of the Chairman or Vice Chairman
of the Board on one day's notice given to each Director either
in person or by mail, telephone, telegram, cable or wireless
to each Director at his or her residence or regular place of
business. Special meetings will be called by the Chairman or
Vice Chairman of the Board or Secretary in a like manner on
the written request of a majority of the Directors.
Section 3.9. Quorum and Voting. At all meetings of the
Board, the presence of a majority of the entire Board of
Directors shall be necessary to constitute a quorum and
sufficient for the transaction of business; provided, however,
that if there are only two or three Directors, not less than
two may constitute a quorum and provided, further, that if
there is only one Director, the presence of such Director will
constitute a quorum. The act of a majority of the Directors
present at a meeting at which there is a quorum shall be the
act of the Board of Directors, except as may be otherwise
specifically provided by statute, by the Charter or by these
Bylaws. If a quorum shall not be present at any meeting of
Directors, the Directors present thereat may adjourn the
meeting from time to time, without notice other than
announcement at the meeting, until a quorum shall be present.
The Directors present at a meeting which has been
duly called and at which a quorum has been established may
continue to transact business until adjournment,
notwithstanding the withdrawal from the meeting of enough
Directors to leave fewer than required to establish a quorum.
If enough Directors have withdrawn from a meeting to leave
fewer than required to establish a quorum, but the meeting is
not adjourned, the action of the majority of that number of
Directors necessary to constitute a quorum at such meeting
shall be the action of the Board of Directors, except as may
be otherwise specifically provided by statute, by the Charter
or by these Bylaws.
Section 3.10. Organization. The Board of Directors shall
designate one of its members to serve as Chairman of the
Board. The Chairman of the Board shall preside at each meeting
of the Board. In the absence or inability of the Chairman of
the Board to act, another Director chosen by a majority of the
Directors present, shall act as chairman of the meeting and
preside at the meeting. The Secretary (or, in his or her
absence or inability to act, any person appointed by the
Chairman) shall act as secretary of the meeting and keep the
minutes of the meeting.
Section 3.11. Informal Action by Directors and
Committees. Any action required or permitted to be taken at
any meeting of the Board of Directors or of any committee
thereof may, except as otherwise required by statute, be taken
without a meeting if a consent to such action is given in
writing or by electronic transmission by all members of the
Board, or of such committee, as the case may be, and filed
with the minutes of the proceedings of the Board or committee.
Subject to the Investment Company Act, members of the Board of
Directors or a committee thereof may participate in a meeting
by means of a conference telephone or similar communications
equipment if all persons participating in the meeting can hear
each other at the same time.
Section 3.12. Executive Committee. There may be an
Executive Committee of two or more Directors appointed by the
Board who may meet at stated times or on notice to all by any
of their own number. The Executive Committee shall consult
with and advise the Officers of the Company in the management
of its business and exercise such powers of the Board of
Directors as may be lawfully delegated by the Board of
Directors. Vacancies shall be filled by the Board of Directors
at any regular or special meeting. The Executive Committee
shall keep regular minutes of its proceedings and report the
same to the Board when required.
Section 3.13. Audit Committee. There shall be an Audit
Committee of two or more Directors who are not "interested
persons" of the Company (as defined in the Investment Company
Act) appointed by the Board who may meet at stated times or on
notice to all by any of their own number. The Committee's
duties shall include reviewing both the audit and other work
of the Company's independent accountants, recommending to the
Board of Directors the independent accountants to be retained,
and reviewing generally the maintenance and safekeeping of the
Company's records and documents.
Section 3.14. Other Committees. The Board of Directors
may appoint other committees which shall in each case consist
of such number of members (which may be one) and shall have
and may exercise, to the extent permitted by law, such powers
as the Board may determine in the resolution appointing them.
A majority of all members of any such committee may determine
its action, and fix the time and place of its meetings, unless
the Board of Directors shall otherwise provide. The Board of
Directors shall have power at any time to change the members
and, to the extent permitted by law, to change the powers of
any such committee, to fill vacancies and to discharge any
such committee.
Section 3.15. Compensation of Directors. The Board may,
by resolution, determine what compensation and reimbursement
of expenses of attendance at meetings, if any, shall be paid
to Directors in connection with their service on the Board or
on various committees of the Board. Nothing herein contained
shall be construed to preclude any Director from serving the
Company in any other capacity or from receiving compensation
therefor.
Section 3.16. Authority to Retain Experts and Advisers.
The Directors who are not "interested persons" (as defined in
the Investment Company Act) of the Company may hire employees
and retain experts and advisers, including independent legal
counsel, at the expense of the Company, to the extent such
Directors deem necessary to carry out their duties as
Directors.
Section 3.17. Reliance. Each Director and Officer of the
Company shall, in the performance of his or her duties with
respect to the Company, be entitled to rely on any
information, opinion, report or statement, including any
financial statement or other financial data, prepared or
presented by an Officer or employee of the Company whom the
Director or Officer reasonably believes to be reliable and
competent in the matters presented, by a lawyer, certified
public accountant or other person, as to a matter which the
Director or Officer reasonably believes to be within the
person's professional or expert competence, or, with respect
to a Director, by a committee of the Board of Directors on
which the Director does not serve, as to a matter within its
designated authority, if the Director reasonably believes the
committee to merit confidence.
Section 3.18. Ratification. The Board of Directors or
the Stockholders may ratify and make binding on the Company
any action or inaction by the Company or its Officers to the
extent that the Board of Directors or the Stockholders could
have originally authorized the matter. Moreover, any action or
inaction questioned in any Stockholders' derivative proceeding
or any other proceeding on the ground of lack of authority,
defective or irregular execution, adverse interest of a
Director, Officer or Stockholder, non-disclosure,
miscomputation, the application of improper principles or
practices of accounting or otherwise, may be ratified, before
or after judgment, by the Board of Directors or by the
Stockholders, and if so ratified, shall have the same force
and effect as if the questioned action or inaction had been
originally duly authorized, and such ratification shall be
binding upon the Company and its Stockholders and shall
constitute a bar to any claim or execution of any judgment in
respect of such questioned action or inaction.
Section 3.19. Emergency Provisions. Notwithstanding any
other provision in the Charter or these Bylaws, this Section
3.19 shall apply during the existence of any catastrophe, or
other similar emergency condition, as a result of which a
quorum of the Board of Directors under this Article III cannot
readily be obtained (an "Emergency"). During any Emergency,
unless otherwise provided by the Board of Directors, (i) a
meeting of the Board of Directors or a committee thereof may
be called by any Director or Officer by any means feasible
under the circumstances; (ii) notice of any meeting of the
Board of Directors during such an Emergency may be given less
than 24 hours prior to the meeting to as many Directors and by
such means as may be feasible at the time, including
publication, television or radio; and (iii) the number of
Directors necessary to constitute a quorum shall be one-third
of the entire Board of Directors.
ARTICLE IV
OFFICERS
Section 4.1. Officers. The Officers of the Company
shall be fixed by the Board of Directors and shall include a
President, Secretary and Treasurer. Any two offices may be
held by the same person except the offices of President and
Vice President. A person who holds more than one office in the
Company may not act in more than one capacity to execute,
acknowledge or verify an instrument required by law to be
executed, acknowledged or verified by more than one Officer.
Section 4.2. Election of Officers. The Directors shall
elect the Officers, who need not be members of the Board.
Section 4.3. Additional Officers. The Board may appoint
such other Officers and agents as it shall deem necessary who
shall exercise such powers and perform such duties as shall be
determined from time to time by the Board.
Section 4.4. Salaries of Officers. The salaries of all
Officers of the Company shall be fixed by the Board of
Directors.
Section 4.5. Term, Removal, Resignation and Vacancies.
The Officers of the Company shall serve at the pleasure of the
Board of Directors and hold office for one year and until
their successors are elected and qualify. Any officer of the
Company may be removed, with or without cause, by the Board of
Directors if in its judgment the best interests of the Company
would be served thereby. Any officer of the Company may resign
at any time by delivering his or her resignation to the Board
of Directors, the Chairman of the Board, the Chief Executive
Officer, the President or the Secretary. Any resignation shall
take effect immediately upon its receipt or at such later time
specified in the resignation. The acceptance of a resignation
shall not be necessary to make it effective unless otherwise
stated in the resignation. Such resignation shall be without
prejudice to the contract rights, if any, of the Company. If
the office of any Officer becomes vacant for any reason, the
vacancy shall be filled by the Board of Directors.
Section 4.6. Chief Executive Officer; President. The
Chief Executive Officer shall be the highest ranking Officer
of the Company and shall, subject to the supervision of the
Board of Directors, have general oversight responsibility for
the management of the business of the Company. The Chief
Executive Officer shall see that all orders and resolutions of
the Board are carried into effect. If the Board has not
selected a Chief Executive Officer, the President shall be the
Chief Executive Officer of the Company and shall perform the
duties and exercise the powers of the Chief Executive Officer
and shall perform such other duties as the Board of Directors
shall prescribe. The Company may select a President in
addition to the Chief Executive Officer, to have such duties
as the Board of Directors shall prescribe.
Section 4.7. Vice President. Any Vice President shall,
in the absence or disability of the President, perform the
duties and exercise the powers of the President and shall
perform such other duties as the Board of Directors shall
prescribe.
Section 4.8. Treasurer or Chief Financial Officer. The
Treasurer or Chief Financial Officer shall have the custody of
the corporate funds and securities and shall keep full and
accurate accounts of receipts and disbursements in books
belonging to the Company and shall deposit all moneys and
other valuable effects in the name and to the credit of the
Company in such depositories as may be designated by the Board
of Directors. He or she shall disburse the funds of the
Company as may be ordered by the Board, taking proper vouchers
for such disbursements, and shall render to the Chairman of
the Board and Directors at the regular meetings of the Board,
or whenever they may require it, an account of the financial
condition of the Company.
Any Assistant Treasurer may perform such duties of the
Treasurer or Chief Financial Officer as the Treasurer or Chief
Financial Officer or the Board of Directors may assign, and,
in the absence of the Treasurer or Chief Financial Officer,
may perform all the duties of the Treasurer or Chief Financial
Officer.
Section 4.9. Secretary. The Secretary shall attend
meetings of the Board and meetings of the Stockholders and
record all votes and the minutes of all proceedings in a book
to be kept for those purposes, and shall perform like duties
for the Executive Committee, or other committees, of the Board
when required. He or she shall give or cause to be given
notice of all meetings of Stockholders and special meetings of
the Board of Directors and shall perform such other duties as
may be prescribed by the Board of Directors. The Secretary
shall keep in safe custody the seal of the Company and affix
it to any instrument when authorized by the Board of
Directors.
Any Assistant Secretary may perform such duties of the
Secretary as the Secretary or the Board of Directors may
assign, and, in the absence of the Secretary, may perform all
the duties of the Secretary.
Section 4.10. Subordinate Officers. The Board of
Directors from time to time may appoint such other Officers or
agents as it may deem advisable, each of whom shall serve at
the pleasure of the Board of Directors and have such title,
hold office for such period, have such authority and perform
such duties as the Board of Directors may determine. The Board
of Directors from time to time may delegate to one or more
Officers or agents the power to appoint any such subordinate
Officers or agents and to prescribe their respective rights,
terms of office, authorities and duties.
Section 4.11. Surety Bonds. The Board of Directors may
require any Officer or agent of the Company to execute a bond
(including, without limitation, any bond required by the
Investment Company Act, and the rules and regulations of the
Securities and Exchange Commission) to the Company in such sum
and with such surety or sureties as the Board of Directors may
determine, conditioned upon the faithful performance of his or
her duties to the Company, including responsibility for
negligence and for the accounting of any of the Company's
property, funds or securities that may come into his or her
hands.
ARTICLE V
GENERAL PROVISIONS
Section 5.1. Waiver of Notice. Whenever the
Stockholders or the Board of Directors are authorized by
statute, the provisions of the Charter or these Bylaws to take
any action at any meeting after notice, such notice may be
waived, in writing, before or after the holding of the
meeting, by the person or persons entitled to such notice, or,
in the case of a Stockholder, by his or her duly authorized
attorney-in-fact.
Section 5.2. Indemnification and Advance of Expenses.
(a) The Company shall indemnify its Directors to the
fullest extent that indemnification of Directors is permitted
by the MGCL. The Company shall indemnify its Officers to the
same extent as its Directors and to such further extent as is
consistent with law. The Company shall indemnify its
Directors and Officers who, while serving as Directors or
Officers, also serve at the request of the Company as a
Director, Officer, partner, trustee, employee, agent or
fiduciary of another corporation, partnership, joint venture,
trust, other enterprise or employee benefit plan to the
fullest extent consistent with law. The indemnification and
other rights provided by this Section shall continue as to a
person who has ceased to be a Director or Officer and shall
inure to the benefit of the heirs, executors and
administrators of such a person. This Section shall not
protect any such person against any liability to the Company
or any Stockholder thereof to which such person would
otherwise be subject by reason of willful misfeasance, bad
faith, gross negligence or reckless disregard of the duties
involved in the conduct of his or her office ("disabling
conduct").
(b) Any current or former Director or Officer of the
Company seeking indemnification within the scope of this
Section shall be entitled to advances from the Company for
payment of the reasonable expenses incurred by him or her in
connection with the matter as to which he or she is seeking
indemnification in the manner and to the fullest extent
permissible under the MGCL without a preliminary determination
of entitlement to indemnification (except as provided below).
The person seeking indemnification shall provide to the
Company a written affirmation of his or her good faith belief
that the standard of conduct necessary for indemnification by
the Company has been met and a written undertaking to repay
any such advance if it should ultimately be determined that
the standard of conduct has not been met. In addition, at
least one of the following additional conditions shall be met:
(i) the person seeking indemnification shall provide a
security in form and amount acceptable to the Company for his
or her undertaking; (ii) the Company is insured against losses
arising by reason of the advance; or (iii) a majority of a
quorum of Directors of the Company who are neither "interested
persons" as defined in Section 2(a) (19) of the Investment
Company Act nor parties to the proceeding ("disinterested non-
party Directors"), or independent legal counsel, in a written
opinion, shall have determined, based on a review of facts
readily available to the Company at the time the advance is
proposed to be made, that there is reason to believe that the
person seeking indemnification will ultimately be found to be
entitled to indemnification.
(c) At the request of any person claiming
indemnification under this Section, the Board of Directors
shall determine, or cause to be determined, in a manner
consistent with the MGCL, whether the standards required by
this Section have been met. Indemnification shall be made only
following: (i) a final decision on the merits by a court or
other body before whom the proceeding was brought that the
person to be indemnified was not liable by reason of disabling
conduct or (ii) in the absence of such a decision, a
reasonable determination, based upon a review of the facts,
that the person to be indemnified was not liable by reason of
disabling conduct by (A) the vote of a majority of a quorum of
disinterested non-party Directors or (B) an independent legal
counsel in a written opinion.
(d) Employees and agents who are not Officers or
Directors of the Company may be indemnified, and reasonable
expenses may be advanced to such employees or agents, as may
be provided by action of the Board of Directors or by
contract, subject to any limitations imposed by the Investment
Company Act.
(e) The Board of Directors may make further provision
consistent with law for indemnification and advance of
expenses to Directors, Officers, employees and agents by
resolution, agreement or otherwise. The indemnification
provided by this Section shall not be deemed exclusive of any
other right, with respect to indemnification or otherwise, to
which those seeking indemnification may be entitled under any
insurance or other agreement or resolution of Stockholders or
disinterested Directors or otherwise.
(f) References in this Section are to the MGCL and to
the Investment Company Act. The rights to indemnification and
advance of expenses provided by the Charter and these Bylaws
shall vest immediately upon the election of a Director or
Officer. No amendment of these Bylaws shall affect any right
of any person under this Section based on any event, omission
or proceeding prior to the amendment.
Section 5.3. Insurance. The Company may purchase and
maintain insurance on behalf of any person who is or was a
Director, Officer, employee or agent of the Company or who,
while a Director, Officer, employee or agent of the Company,
is or was serving at the request of the Company as a Director,
Officer, partner, trustee, employee or agent of another
foreign or domestic corporation, partnership, joint venture,
trust, other enterprise or employee benefit plan, against any
liability asserted against and incurred by such person in any
such capacity or arising out of such person's position;
provided that no insurance may be purchased by the Company on
behalf of any person against any liability to the Company or
to its Stockholders to which he or she 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.
Section 5.4. Checks. All checks or demands for money
and notes of the Company shall be signed by such Officer or
Officers or such other person or persons as the Board of
Directors may from time to time designate.
Section 5.5. Fiscal Year. The fiscal year of the
Company shall be determined by resolution of the Board of
Directors.
ARTICLE VI
SHARES
Section 6.1(a). Certificates of Stock. The Board of
Directors may authorize the Company to issue some or all of
the shares of any class or series of its stock without
certificates. In the event that the Company issues shares of
stock represented by certificates, such certificates shall be
in such form as prescribed by the Board of Directors or a duly
authorized Officer, shall contain the statements and
information required by the MGCL and shall be signed by the
Officers of the Company in the manner permitted by the MGCL.
In the event that the Company issues shares of stock without
certificates, to the extent then required by the MGCL, the
Company shall provide to record holders of such shares a
written statement of the information required by the MGCL to
be included on stock certificates. There shall be no
differences in the rights and obligations of Stockholders
based on whether or not their shares are represented by
certificates. If shares of a class or series of stock are
authorized by the Board of Directors to be issued without
certificates, no Stockholder shall be entitled to a
certificate or certificates representing any shares of such
class or series of stock held by such Stockholder unless
otherwise determined by the Board of Directors and then only
upon written request by such Stockholder to the Secretary of
the Company.
Section 6.1(b). Uncertificated Shares. For any
shares issued without certificates, the Company or a Transfer
Agent of the Company may either issue receipts therefor or may
keep accounts upon the books of the Company for the record
holders of such shares, who shall in either case be deemed,
for all purposes hereunder, to be the holders of such shares
as if they had received certificates therefor.
Section 6.2. Lost, Stolen or Destroyed Certificates.
The Board of Directors, or the President together with the
Treasurer or Chief Financial Officer or Secretary, may direct
a new certificate to be issued in place of any certificate for
certificated shares theretofore issued by the Company, alleged
to have been lost, stolen or destroyed, upon the making of an
affidavit of that fact by the person claiming the certificate
of stock to be lost, stolen or destroyed, or by his or her
legal representative; provided, however, if such shares have
ceased to be certificated, no new certificate shall be issued
unless requested in writing by such stockholder and the Board
of Directors has determined that such certificates may be
issued. When authorizing such issue of a new certificate, the
Board of Directors, or the President and Treasurer or Chief
Financial Officer or Secretary, may, in its or their
discretion and as a condition precedent to the issuance
thereof, require the owner of such lost, stolen or destroyed
certificate, or his or her legal representative, to advertise
the same in such manner as it or they shall require and/or
give the Company a bond in such sum and with such surety or
sureties as it or they may direct as indemnity against any
claim that may be made against the Company with respect to the
certificate alleged to have been lost, stolen or destroyed for
such newly issued certificate.
Section 6.3. Transfer of Stock. Transfer of shares of
the Company shall be made on the books of the Company by the
registered holder thereof or by his or her duly authorized
attorney or legal representative and upon surrender and
cancellation of a certificate or certificates, if issued, for
the same number of shares of the same class, duly endorsed or
accompanied by proper evidence of succession, assignment or
authority to transfer, with such proof of the authenticity of
the transferor's signature as the Company or its agents may
reasonably require. The shares of stock of the Company may be
freely transferred, and the Board of Directors may, from time
to time, adopt rules and regulations with reference to the
method of transfer of the shares of stock of the Company. Upon
the transfer of any uncertificated shares, to the extent then
required by the MGCL, the Corporation shall provide to the
record holders of such shares a written statement of the
information required by the MGCL to be included on stock
certificates.
Section 6.4. Registered Holder. The Company shall be
entitled to treat the holder of record of any share or shares
of stock as the holder in fact thereof and, accordingly, shall
not be bound to recognize any equitable or other claim to or
interest in such share or shares on the part of any other
person whether or not it shall have express or other notice
thereof, except as expressly provided by statute.
Section 6.5. Record Date. The Board of Directors may
fix a time not less than 10 nor more than 90 days prior to the
date of any meeting of Stockholders as the time as of which
Stockholders are entitled to notice of, and to vote at, such a
meeting; and all such persons who were holders of record of
voting stock at such time, and no other, shall be entitled to
notice of, and to vote at, such meeting or to express their
consent or dissent, as the case may be. If no record date has
been fixed, the record date for the determination of the
Stockholders entitled to notice of, or to vote at, a meeting
of Stockholders shall be the later of the close of business on
the day on which notice of the meeting is mailed or
transmitted or the 30th day before the meeting, or, if notice
is waived by all Stockholders, at the close of business on the
tenth day immediately preceding the day on which the meeting
is held.
When a record date for the determination of stockholders
entitled to notice of and to vote at any meeting of
stockholders has been set as provided in this section, such
record date shall continue to apply to the meeting if
adjourned or postponed, except if the meeting is adjourned or
postponed to a date more than 120 days after the record date
originally fixed for the meeting, in which case a new record
date for such meeting may be determined as set forth herein.
The Board of Directors may also fix a time not exceeding
90 days preceding the date fixed for the payment of any
dividend or the making of any distribution, or for the
delivery of evidences of rights, or evidences of interests
arising out of any change, conversion or exchange of capital
stock, as a record time for the determination of the
Stockholders entitled to receive any such dividend,
distribution, rights or interests.
Section 6.6. Stock Ledgers. The stock ledgers of the
Company, containing the names and addresses of the
Stockholders and the number of shares held by them
respectively, shall be kept at the principal offices of the
Company or at such other location as may be authorized by the
Board of Directors from time to time, except that an original
or duplicate stock ledger shall be maintained at the office of
the Company's Transfer Agent.
Section 6.7. Transfer Agents and Registrars. The Board
of Directors may from time to time appoint or remove Transfer
Agents and/or Registrars of transfers (if any) of shares of
stock of the Company, and it may appoint the same person as
both Transfer Agent and Registrar. Upon any such appointment
being made, all certificates representing shares of capital
stock thereafter issued shall be countersigned by one of such
Transfer Agents or by one of such Registrars of transfers (if
any) or by both and shall not be valid unless so
countersigned. If the same person shall be both Transfer Agent
and Registrar, only one countersignature by such person shall
be required.
ARTICLE VII
SPECIAL PROVISIONS
Section 7.1. Actions Relating to Discount in Price of
the Company's Shares. In the event that at any time after the
third year following the initial public offering of shares of
the Company's Common Stock such shares publicly trade for a
substantial period of time at a significant discount from the
Company's then current net asset value per share, the Board of
Directors shall consider, at its next regularly scheduled
meeting, taking various actions designed to eliminate the
discount. The actions considered by the Board of Directors may
include periodic repurchases by the Company of its shares of
Common Stock or an amendment to the Charter to make the
Company's Common Stock a "redeemable security" (as such term
is defined in the Investment Company Act), subject in all
events to compliance with all applicable provisions of the
Charter, these Bylaws, the MGCL and the Investment Company
Act.
ARTICLE VIII
AMENDMENTS
Section 8.1. General. Except as provided in the next
succeeding sentence, and except as otherwise required by the
Investment Company Act, all Bylaws of the Company shall be
subject to amendment, alteration or repeal, and new Bylaws may
be made, exclusively by the affirmative vote of at least a
majority of the entire Board of Directors, at any regular or
special meeting, the notice or waiver of notice of which shall
have specified or summarized the proposed amendment,
alteration, repeal or new Bylaw. The provisions of Sections
2.5, 3.2, 3.4, 7.1 and 8.1 of these Bylaws shall be subject to
amendment, alteration or repeal exclusively by the affirmative
vote of at least a majority of the entire Board of Directors,
including at least 80% of the Continuing Directors (as such
term is defined in Section VI of the Charter), at any regular
or special meeting, the notice or waiver of notice of which
shall have specified or summarized the proposed amendment,
alteration or repeal.
Dated: January 12, 2006
As Amended and Restated: July 19th, 2011
EX-99.77B ACCT LTTR
3
pfo77b.txt
Report of Independent Registered Public Accounting Firm
To the Shareholders and Board of Directors of
Flaherty & Crumrine Preferred Income Opportunity Fund Incorporated
In planning and performing our audit of the financial
statements of Flaherty & Crumrine Preferred Income
Opportunity Fund Incorporated (the Fund) as of and for
the year ended November 30, 2011, in accordance with the
standards of the Public Company Accounting Oversight
Board (United States), we considered the Fund's internal
control over financial reporting, including controls over
safeguarding securities, as a basis for designing our
auditing procedures for the purpose of expressing our
opinion on the financial statements and to comply with
the requirements of Form N-SAR, but not for the purpose
of expressing an opinion on the effectiveness of the
Fund's internal control over financial reporting.
Accordingly, we express no such opinion.
Management of the Fund is responsible for establishing
and maintaining effective internal control over financial
reporting. In fulfilling this responsibility, estimates
and judgments by management are required to assess the
expected benefits and related costs of controls. A
company's internal control over financial reporting is a
process designed to provide reasonable assurance
regarding the reliability of financial reporting and the
preparation of financial statements for external purposes
in accordance with generally accepted accounting
principles. A company's internal control over financial
reporting includes those policies and procedures that (1)
pertain to the maintenance of records that, in reasonable
detail, accurately and fairly reflect the transactions
and dispositions of the assets of the company; (2)
provide reasonable assurance that transactions are
recorded as necessary to permit preparation of financial
statements in accordance with generally accepted
accounting principles, and that receipts and expenditures
of the company are being made only in accordance with
authorizations of management and directors of the
company; and (3) provide reasonable assurance regarding
prevention or timely detection of unauthorized
acquisition, use, or disposition of the company's assets
that could have a material effect on the financial
statements.
Because of its inherent limitations, internal control
over financial reporting may not prevent or detect
misstatements. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk
that controls may become inadequate because of changes in
conditions, or that the degree of compliance with the
policies or procedures may deteriorate.
A deficiency in internal control over financial reporting
exists when the design or operation of a control does not
allow management or employees, in the normal course of
performing their assigned functions, to prevent or detect
misstatements on a timely basis. A material weakness is a
deficiency, or a combination of deficiencies, in internal
control over financial reporting, such that there is a
reasonable possibility that a material misstatement of
the Fund's annual or interim financial statements will
not be prevented or detected on a timely basis.
Our consideration of the Fund's internal control over
financial reporting was for the limited purpose described
in the first paragraph and would not necessarily disclose
all deficiencies in internal control that might be
material weaknesses under standards established by the
Public Company Accounting Oversight Board (United
States). However, we noted no deficiencies in the Fund's
internal control over financial reporting and its
operation, including controls over safeguarding
securities, that we consider to be a material weakness as
defined above as of November 30, 2011.
This report is intended solely for the information and
use of management and the Board of Directors of Flaherty
& Crumrine Preferred Income Opportunity Fund Incorporated
and the Securities and Exchange Commission and is not
intended to be and should not be used by anyone other
than these specified parties.
KPMG LLP
Boston, Massachusetts
January 24, 2012