{"annotation_id":"6977d233-655e-416f-b0fe-24745d1a48c0","file_hash":"16f3025f7a3f49c7a90ea5dbb0e05c1040e46f7a0a2952e25dc0719cc2227920","schema_id":"open/document-extraction","schema_version":"0.5.0","record":{"extraction_type":"boxes","producer":"pdf-extractor-v0.5.0","blocks":[{"id":"3d4685a6-0130-4763-89d5-d711ca1ddf5a","block_type":"box","text":"STATEMENT OF ADDITIONAL INFORMATION","page_number":1,"box":{"x":271,"y":83,"width":435,"height":11}},{"id":"99d39104-45e3-440f-8f66-c82386a8d565","block_type":"box","text":"BlackRock Funds","page_number":1,"box":{"x":371,"y":120,"width":216,"height":14}},{"id":"725b5cb2-caee-4107-a84a-9c6fba8fbb3e","block_type":"box","text":"SM","page_number":1,"box":{"x":589,"y":120,"width":19,"height":7}},{"id":"865e68dd-c69d-4600-a588-6771cc7e2485","block_type":"box","text":"BlackRock Technology Opportunities Fund","page_number":1,"box":{"x":335,"y":149,"width":308,"height":11}},{"id":"8d376b54-2f2a-449f-9894-969964abc528","block_type":"box","text":"100 Bellevue Parkway, Wilmington, Delaware 19809 • Phone No. (800) 441-7762","page_number":1,"box":{"x":118,"y":176,"width":742,"height":14}},{"id":"49b5c451-5f2a-4b7c-90b5-8592301d8e80","block_type":"box","text":"This Statement of Additional Information of BlackRock Technology Opportunities Fund (the “Fund”), a","page_number":1,"box":{"x":101,"y":233,"width":776,"height":12}},{"id":"cbe42fbc-22b1-4972-b3a6-655fe3eaf9a8","block_type":"box","text":"series of BlackRock Funds","page_number":1,"box":{"x":69,"y":249,"width":199,"height":9}},{"id":"10698a07-cc51-4c50-8488-417e6fe3b094","block_type":"box","text":"SM","page_number":1,"box":{"x":269,"y":249,"width":12,"height":5}},{"id":"4b5d0147-4364-43c4-aab2-26a28524514e","block_type":"box","text":"(the “Trust”), is not a prospectus and should be read in conjunction with the","page_number":1,"box":{"x":286,"y":248,"width":575,"height":12}},{"id":"6fbc9a1f-eda4-4ce8-8e24-f9f31b993143","block_type":"box","text":"prospectuses of the Fund, dated September 28, 2026, as they may be amended or supplemented from time to","page_number":1,"box":{"x":70,"y":264,"width":836,"height":11}},{"id":"4b88f347-76a6-47bf-a5fa-f0e6bfa3700c","block_type":"box","text":"time (the “Prospectus”), which have been filed with the Securities and Exchange Commission (the","page_number":1,"box":{"x":69,"y":279,"width":743,"height":12}},{"id":"b03a3178-6f07-4cd9-a38c-4e1aa95e1388","block_type":"box","text":"“Commission” or the “SEC”) and can be obtained, without charge, by calling (800) 441-7762 or by writing to","page_number":1,"box":{"x":69,"y":294,"width":820,"height":12}},{"id":"d93fb6cc-a9f7-41a1-90c0-c702454d5960","block_type":"box","text":"the Fund at the above address. 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The Fund will not purchase securities while its aggregate borrowings (including reverse repurchase","page_number":8,"box":{"x":69,"y":355,"width":818,"height":11}},{"id":"6e6a8727-4dca-46bb-a003-bf48a9ae9c22","block_type":"box","text":"agreements and borrowings from banks) in excess of 5% of its total assets are outstanding. 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Purchase any securities which would cause 25% or more of the value of the Fund’s total assets at the","page_number":8,"box":{"x":135,"y":445,"width":746,"height":11}},{"id":"b53154be-523e-4f5b-9980-bee6a0756dde","block_type":"box","text":"time of purchase to be invested in the securities of one or more issuers conducting their principal business","page_number":8,"box":{"x":101,"y":460,"width":766,"height":12}},{"id":"cba78ad2-bdfc-4c0d-ad03-c88f9342f66d","block_type":"box","text":"activities in the same industry, provided that (a) there is no limitation with respect to (i) instruments issued or","page_number":8,"box":{"x":102,"y":476,"width":784,"height":11}},{"id":"509db51c-88d6-4d94-a866-d7e8e5626e0d","block_type":"box","text":"guaranteed by the United States and tax exempt instruments issued by any state, territory or possession of the","page_number":8,"box":{"x":101,"y":491,"width":797,"height":11}},{"id":"4a0c18ca-c712-48f4-a44a-f0839dea692e","block_type":"box","text":"United States, the District of Columbia or any of their authorities, agencies, instrumentalities or political","page_number":8,"box":{"x":102,"y":506,"width":740,"height":11}},{"id":"8c878985-3d35-4bec-be8b-3cf18efa18c6","block_type":"box","text":"subdivisions, and (ii) repurchase agreements secured by the instruments described in clause (i); (b) wholly","page_number":8,"box":{"x":102,"y":521,"width":763,"height":11}},{"id":"df3bbec3-1eab-4710-8a92-a48de78b584b","block_type":"box","text":"owned finance companies will be considered to be in the industries of their parents if their activities are primarily","page_number":8,"box":{"x":102,"y":536,"width":806,"height":11}},{"id":"a65fd072-36a3-4821-a10e-c671a26cdbbb","block_type":"box","text":"related to financing the activities of the parents; (c) utilities will be divided according to their services; for","page_number":8,"box":{"x":102,"y":551,"width":750,"height":11}},{"id":"a2e49725-8018-4c40-8352-052a41dd7454","block_type":"box","text":"example, gas, gas transmission, electric and gas, electric and telephone will each be considered a separate","page_number":8,"box":{"x":101,"y":566,"width":772,"height":11}},{"id":"42fa90f2-9f67-4867-9fa8-aa48fc8fef01","block_type":"box","text":"industry; and (d) the Fund may cause 25% or more of its total assets at the time of purchase to be invested in","page_number":8,"box":{"x":102,"y":581,"width":787,"height":11}},{"id":"15347a26-9560-4a0e-aac4-62899b8f356e","block_type":"box","text":"the securities of one or more issuers conducting their principal business activities in a single industry in the","page_number":8,"box":{"x":101,"y":596,"width":771,"height":12}},{"id":"f448d401-ffb6-49b9-bede-e0a366fb6b80","block_type":"box","text":"science and technology sectors as defined in its prospectuses.","page_number":8,"box":{"x":102,"y":612,"width":448,"height":11}},{"id":"91f60000-899e-4355-8dae-fa522064dbcf","block_type":"box","text":"2. 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Act as an underwriter of securities within the meaning of the Securities Act of 1933, as amended, except","page_number":8,"box":{"x":134,"y":725,"width":771,"height":11}},{"id":"72ed6aaf-64de-4d1a-bf10-6d8dd14542cd","block_type":"box","text":"to the extent that the purchase of obligations directly from the issuer thereof, or the disposition of securities, in","page_number":8,"box":{"x":101,"y":740,"width":797,"height":11}},{"id":"c8c94415-8cd9-4ea1-9e9d-a1f95429002b","block_type":"box","text":"accordance with the Fund’s investment objective, policies and limitations may be deemed to be underwriting.","page_number":8,"box":{"x":102,"y":755,"width":777,"height":11}},{"id":"b84384a4-e9d1-4a8c-80dd-ff85512b8507","block_type":"box","text":"5. 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With respect to the fundamental policy relating to issuing senior","page_number":9,"box":{"x":69,"y":241,"width":803,"height":11}},{"id":"844e09f2-9bde-46f1-97a6-c368ee2d3546","block_type":"box","text":"securities above, the Investment Company Act, including the rules and regulations thereunder, generally prohibits the","page_number":9,"box":{"x":69,"y":256,"width":835,"height":12}},{"id":"a4212ab8-2c6d-4e63-a710-db944fb1b08b","block_type":"box","text":"Fund from issuing senior securities (other than cer tain temporary borrowings) unless immediately after the issuance","page_number":9,"box":{"x":70,"y":271,"width":828,"height":12}},{"id":"8db3c951-5372-4030-9f28-a8eb4b625a82","block_type":"box","text":"the Fund has satisfied an asset coverage requirement with respect to senior securities representing indebtedness","page_number":9,"box":{"x":68,"y":286,"width":815,"height":12}},{"id":"265f1356-2b58-4bdb-8261-6d06c66d25f2","block_type":"box","text":"prescribed by the Investment Company Act. Cer tain trading practices and investments, such as derivatives","page_number":9,"box":{"x":70,"y":302,"width":758,"height":11}},{"id":"72d6fdc3-78f8-44f4-8611-bc679b3b53be","block_type":"box","text":"transactions, may be treated as senior securities. Prior to the adoption and implementation of Rule 18f-4 under the","page_number":9,"box":{"x":68,"y":317,"width":824,"height":11}},{"id":"a5e7f8c5-1683-43e6-848f-7a3a765a3666","block_type":"box","text":"Investment Company Act, when the Fund engaged in a derivatives transaction that creates future payment","page_number":9,"box":{"x":70,"y":332,"width":754,"height":11}},{"id":"59cdc45d-3b70-4586-9a4f-57da56780764","block_type":"box","text":"obligations, consistent with SEC staff guidance and interpretations, the Fund was permitted to segregate or earmark","page_number":9,"box":{"x":69,"y":347,"width":832,"height":11}},{"id":"b509a9f6-a044-4f11-b77d-f2fe72c8d136","block_type":"box","text":"liquid assets, or enter into an offsetting position, in an amount at least equal to the Fund’s exposure, on a mark-to","page_number":9,"box":{"x":70,"y":362,"width":823,"height":11}},{"id":"bbfaab9b-7b5f-4e70-973a-a396ac5261aa","block_type":"box","text":"market basis, to the transaction, instead of meeting the asset coverage requirement with respect to senior securities","page_number":9,"box":{"x":69,"y":377,"width":837,"height":12}},{"id":"0bcc568a-cd91-4159-8b63-b3f10d9c2954","block_type":"box","text":"prescribed by the Investment Company Act. The SEC staff guidance and interpretations were rescinded in connection","page_number":9,"box":{"x":70,"y":392,"width":832,"height":12}},{"id":"48fe4f04-5323-4b4d-bcbf-964a974138da","block_type":"box","text":"with the adoption of Rule 18f-4, and the Fund now complies with Rule 18f-4 with respect to its derivatives","page_number":9,"box":{"x":68,"y":407,"width":753,"height":11}},{"id":"b3b3cf8d-01d9-4651-977a-ec584b87338c","block_type":"box","text":"transactions. Thus, the fundamental policy relating to issuing senior securities above will not restrict the Fund from","page_number":9,"box":{"x":68,"y":423,"width":820,"height":11}},{"id":"1f59d5ec-c2c0-40e6-b217-440d60842d21","block_type":"box","text":"entering into derivatives transactions that are treated as senior securities so long as the Fund complies with Rule","page_number":9,"box":{"x":69,"y":438,"width":809,"height":11}},{"id":"0d82ef7b-b7ba-489c-b0c2-807940e76792","block_type":"box","text":"18f-4 with respect to such derivatives transactions.","page_number":9,"box":{"x":70,"y":453,"width":364,"height":11}},{"id":"03d319dd-5a17-47d5-91e3-3e8a694819b7","block_type":"box","text":"For purposes of investment restriction 1 above, with respect to the Fund’s industry classifications, the Fund","page_number":9,"box":{"x":102,"y":475,"width":768,"height":12}},{"id":"b1561054-c87f-469c-a5c9-7389c404b0d5","block_type":"box","text":"currently utilizes any one or more of the industry sub-classifications used by one or more widely recognized market","page_number":9,"box":{"x":69,"y":491,"width":817,"height":11}},{"id":"72a76f7a-4ad7-46cd-b8fa-1a1057fc2aac","block_type":"box","text":"indexes or rating group indexes, and/or as defined by Fund management. The policy also will be interpreted to give","page_number":9,"box":{"x":70,"y":506,"width":817,"height":11}},{"id":"dc8fd09e-8c0c-47df-ad60-f2d24dc0f890","block_type":"box","text":"broad authority to the Fund as to how to classify issuers within or among industries.","page_number":9,"box":{"x":69,"y":521,"width":597,"height":11}},{"id":"13be4a25-28ab-431b-aee4-8ff31e7f56e0","block_type":"box","text":"While cer tain swaps are now considered commodity interests for purposes of the Commodity Exchange Act and","page_number":9,"box":{"x":101,"y":543,"width":793,"height":12}},{"id":"9e8d2a80-5749-404b-bb55-270a227cc44e","block_type":"box","text":"the rules thereunder, at the time of the Fund’s adoption of fundamental investment restrictions no. 5, 8 and 10","page_number":9,"box":{"x":68,"y":559,"width":796,"height":11}},{"id":"beaa4e76-f79b-4fe4-9785-2ce025c5e350","block_type":"box","text":"above, many swaps were treated as securities for purposes of the Fund’s compliance with applicable law.","page_number":9,"box":{"x":69,"y":574,"width":752,"height":11}},{"id":"979cd024-0ea5-44ce-826d-7f5739fa6690","block_type":"box","text":"Accordingly, fundamental investment restriction no. 5, which does not restrict transactions in options on securities","page_number":9,"box":{"x":68,"y":589,"width":817,"height":11}},{"id":"b34cb5b8-8490-445f-b799-9f3449130e58","block_type":"box","text":"and securities indices, and fundamental restrictions no. 8 and 10 are being interpreted to permit the Fund to engage","page_number":9,"box":{"x":69,"y":604,"width":834,"height":11}},{"id":"9254d6cf-3015-4ed1-a295-09e1c305d229","block_type":"box","text":"in transactions in swaps and options on swaps, as applicable, related to financial instruments, such as securities,","page_number":9,"box":{"x":70,"y":619,"width":815,"height":11}},{"id":"0ab337db-a9d3-4970-8bbd-f9ed7b81586f","block_type":"box","text":"securities indices and currencies, but not to engage in transactions in swaps or options on swaps related to physical","page_number":9,"box":{"x":69,"y":634,"width":833,"height":12}},{"id":"6387b51a-8ab1-4ee5-bec6-d311feb74744","block_type":"box","text":"commodities, such as oil or metals.","page_number":9,"box":{"x":69,"y":650,"width":254,"height":10}},{"id":"ca794d24-f04a-4d5f-ba2a-d3bdc7cb2716","block_type":"box","text":"Under its non-fundamental investment restriction, which may be changed by the Board without shareholder","page_number":9,"box":{"x":102,"y":672,"width":760,"height":11}},{"id":"b86ca3cd-0929-405f-854b-41b5373b8341","block_type":"box","text":"approval, the Fund may not:","page_number":9,"box":{"x":69,"y":687,"width":197,"height":11}},{"id":"e9dc4fc5-c776-4335-8527-b596ca362e4d","block_type":"box","text":"a. Purchase securities of other investment companies, except to the extent permitted by the Investment","page_number":9,"box":{"x":102,"y":710,"width":742,"height":11}},{"id":"4e925a36-0424-49a4-85da-7d8f8aeb3f51","block_type":"box","text":"Company Act. As a matter of policy, however, the Fund will not purchase shares of any registered open-end","page_number":9,"box":{"x":69,"y":725,"width":759,"height":11}},{"id":"3e6db644-568d-4c94-8228-8c0269d8d319","block_type":"box","text":"investment company or registered unit investment trust, in reliance on Section 12(d)(1)(F) or (G) (the “fund of funds”","page_number":9,"box":{"x":70,"y":740,"width":829,"height":11}},{"id":"8d3e183b-2861-4da7-91e2-b45ddf1b226a","block_type":"box","text":"provisions) of the Investment Company Act, at any time the Fund has knowledge that its shares are purchased by","page_number":9,"box":{"x":70,"y":755,"width":808,"height":11}},{"id":"741c8fd1-0799-4f01-b82b-25e22a93f356","block_type":"box","text":"another investment company investor in reliance on the provisions of subparagraph (G) of Section 12(d)(1).","page_number":9,"box":{"x":69,"y":770,"width":763,"height":12}},{"id":"5e385e49-59d3-4186-bd78-1c722e78735f","block_type":"box","text":"Unless otherwise indicated or with respect to policies adopted pursuant to Rule 35d-1 under the Investment","page_number":9,"box":{"x":102,"y":793,"width":771,"height":11}},{"id":"eafbb5b3-3e2a-4f5a-b4d5-e77f9fbacfaa","block_type":"box","text":"Company Act, all limitations under the Fund’s fundamental or non-fundamental investment restrictions apply only at","page_number":9,"box":{"x":69,"y":808,"width":822,"height":11}},{"id":"348da47e-fd61-49cd-8957-f4a11064a4fd","block_type":"box","text":"the time that a transaction is under taken. Any change in the percentage of the Fund’s assets invested in cer tain","page_number":9,"box":{"x":68,"y":823,"width":803,"height":12}},{"id":"c70bb5ce-fb86-40de-b1ad-b3aa0570cf08","block_type":"box","text":"securities or other instruments resulting from market fluctuations or other changes in the Fund’s total assets will not","page_number":9,"box":{"x":69,"y":838,"width":835,"height":12}},{"id":"11d19073-2bf7-4e9b-a008-81667e8e7cb4","block_type":"box","text":"require the Fund to dispose of an investment until BlackRock determines that it is practicable to sell or close out the","page_number":9,"box":{"x":69,"y":853,"width":833,"height":11}},{"id":"3723dc7c-d1c7-4223-9c99-93be8ae052d3","block_type":"box","text":"investment without undue market or tax consequences.","page_number":9,"box":{"x":70,"y":869,"width":393,"height":11}},{"id":"dbdf7e62-3b98-4593-8295-ab7a83cd3be3","block_type":"box","text":"I-7","page_number":9,"box":{"x":481,"y":943,"width":16,"height":9}},{"id":"b4b00921-0896-4db1-94cc-6a897c0d3de2","block_type":"box","text":"NM1026U-5982568-9/232","page_number":9,"box":{"x":764,"y":970,"width":141,"height":7}},{"id":"0fa80de5-06a1-46eb-a214-93158e2ed96e","block_type":"box","text":"III. Information on Trustees and Officers","page_number":10,"box":{"x":69,"y":45,"width":290,"height":9}},{"id":"58885cee-06a1-4f8c-a2cf-3bcbcf16f256","block_type":"box","text":"The Board consists of fifteen individuals (each, a “Trustee”), thir teen of whom are not “interested persons” of","page_number":10,"box":{"x":101,"y":67,"width":788,"height":11}},{"id":"f3f2e590-3175-4f18-a9f7-3afe067a310f","block_type":"box","text":"the Trust as defined in the Investment Company Act (the “Independent Trustees”). The registered investment","page_number":10,"box":{"x":68,"y":82,"width":779,"height":12}},{"id":"114417e3-8e6a-40aa-965e-63257e719697","block_type":"box","text":"companies advised by the Manager or its affiliates (the “BlackRock-advised Funds”) are organized into the BlackRock","page_number":10,"box":{"x":69,"y":98,"width":837,"height":11}},{"id":"121cba67-65d7-4e3f-8596-f9799f43d8b6","block_type":"box","text":"Multi-Asset Complex, the BlackRock Fixed-Income Complex, and the iShares Complex (each, a “BlackRock Fund","page_number":10,"box":{"x":70,"y":113,"width":793,"height":11}},{"id":"de5f2472-d30b-4ae3-914c-1992bd7e0f03","block_type":"box","text":"Complex”). The Trust is included in the BlackRock Fund Complex referred to as the BlackRock Multi-Asset Complex.","page_number":10,"box":{"x":69,"y":128,"width":822,"height":11}},{"id":"7a45a65c-2ce4-46d9-bfe4-c6d8ec86bacb","block_type":"box","text":"The Trustees also oversee as board members the operations of the other open-end registered investment companies","page_number":10,"box":{"x":68,"y":143,"width":837,"height":11}},{"id":"5b2c42aa-e35b-412d-8a0f-be8366a62b2a","block_type":"box","text":"included in the BlackRock Multi-Asset Complex.","page_number":10,"box":{"x":70,"y":158,"width":335,"height":11}},{"id":"41e482ed-8fa1-4239-96f3-19766d284497","block_type":"box","text":"The Board has overall responsibility for the oversight of the Trust and the Fund. The Chair of the Board is an","page_number":10,"box":{"x":101,"y":181,"width":769,"height":11}},{"id":"336a3a63-0f00-41e9-b690-ccf817343efc","block_type":"box","text":"Independent Trustee, and the Chair of each Board committee (each, a “Committee”) is an Independent Trustee. The","page_number":10,"box":{"x":70,"y":196,"width":827,"height":11}},{"id":"43590db1-dea6-44c2-9e2f-a58a006b3fbf","block_type":"box","text":"Board has five standing Committees: an Audit Committee, a Governance and Nominating Committee, a Compliance","page_number":10,"box":{"x":70,"y":211,"width":821,"height":11}},{"id":"a4cb1b4c-0c31-4924-bc4c-895b42ee052e","block_type":"box","text":"Committee, a Per formance Oversight Committee and an Ad Hoc Topics Committee. The role of the Chair of the Board","page_number":10,"box":{"x":69,"y":226,"width":835,"height":11}},{"id":"46388928-2606-4945-89d9-515990ffc498","block_type":"box","text":"is to preside at all meetings of the Board and to act as a liaison with service providers, officers, attorneys and other","page_number":10,"box":{"x":70,"y":241,"width":830,"height":11}},{"id":"410ad702-6b45-47f9-b435-77260abcba83","block_type":"box","text":"Trustees generally between meetings. The Chair of each Committee per forms a similar role with respect to the","page_number":10,"box":{"x":68,"y":256,"width":789,"height":12}},{"id":"1097c789-5840-4cdd-bd15-6f43768bed47","block_type":"box","text":"Committee. The Chair of the Board or the Chair of a Committee may also per form such other functions as may be","page_number":10,"box":{"x":69,"y":271,"width":810,"height":12}},{"id":"3947c4cc-0264-4d2a-b258-6803bc8658b8","block_type":"box","text":"delegated by the Board or the Committee from time to time. The Independent Trustees meet regularly outside the","page_number":10,"box":{"x":69,"y":286,"width":809,"height":12}},{"id":"713d0334-b58c-43d7-b579-f7f2e5cf6683","block_type":"box","text":"presence of Fund management, in executive session or with other service providers to the Fund. The Board has","page_number":10,"box":{"x":70,"y":302,"width":794,"height":11}},{"id":"e1d514d9-052f-4805-b84d-77f90d9ba300","block_type":"box","text":"regular meetings five times a year, and may hold special meetings if required before its next regular meeting. Each","page_number":10,"box":{"x":69,"y":317,"width":816,"height":11}},{"id":"771581cd-2f1a-4613-85fc-cfb4de491894","block_type":"box","text":"Committee meets regularly to conduct the oversight functions delegated to that Committee by the Board and repor ts","page_number":10,"box":{"x":69,"y":332,"width":831,"height":11}},{"id":"d9300141-71a7-41b7-8dc4-348711dd5491","block_type":"box","text":"its findings to the Board. The Board and each standing Committee conduct annual assessments of their oversight","page_number":10,"box":{"x":70,"y":347,"width":811,"height":11}},{"id":"fb92c76d-fccb-4f0c-bfaf-faee4f88c8bc","block_type":"box","text":"function and structure. The Board has determined that the Board’s leadership structure is appropriate because it","page_number":10,"box":{"x":68,"y":362,"width":809,"height":11}},{"id":"b4e45f8c-e2bd-49fb-95a7-3a9008fbb2df","block_type":"box","text":"allows the Board to exercise independent judgment over management and to allocate areas of responsibility among","page_number":10,"box":{"x":69,"y":377,"width":825,"height":12}},{"id":"e1cb9437-20b0-48ad-b1fe-bce51c1b2a5d","block_type":"box","text":"Committees and the full Board to enhance effective oversight.","page_number":10,"box":{"x":69,"y":392,"width":441,"height":12}},{"id":"61c786f7-d9ba-4561-b448-12c9b6dba078","block_type":"box","text":"The Board has engaged the Manager to manage the Fund on a day-to-day basis. The Board is responsible for","page_number":10,"box":{"x":101,"y":415,"width":777,"height":11}},{"id":"9aacde27-824f-4ba8-bf9e-0429e7c5371f","block_type":"box","text":"overseeing the Manager, other service providers, the operations of the Fund and associated risks in accordance with","page_number":10,"box":{"x":69,"y":430,"width":832,"height":11}},{"id":"4205715c-c3ab-4654-8f76-71fab4c546b3","block_type":"box","text":"the provisions of the Investment Company Act, state law, other applicable laws, the Trust’s char ter, and the Fund’s","page_number":10,"box":{"x":68,"y":445,"width":820,"height":11}},{"id":"293a3488-3c82-41c2-853c-83cae0ed534a","block_type":"box","text":"investment objective and strategies. The Board reviews, on an ongoing basis, the Fund’s per formance, operations","page_number":10,"box":{"x":70,"y":460,"width":812,"height":12}},{"id":"e8cdd8c7-9f12-4ec9-ac69-583ff5a53723","block_type":"box","text":"and investment strategies and techniques. The Board also conducts reviews of the Manager and its role in running","page_number":10,"box":{"x":69,"y":475,"width":819,"height":12}},{"id":"371622bb-6c47-4c98-a804-78ddc5235272","block_type":"box","text":"the operations of the Fund.","page_number":10,"box":{"x":68,"y":491,"width":192,"height":11}},{"id":"720bcf08-fc4f-458b-ab0b-3e17d05294bc","block_type":"box","text":"Day-to-day risk management with respect to the Fund is the responsibility of the Manager or of sub-advisers or","page_number":10,"box":{"x":102,"y":513,"width":785,"height":12}},{"id":"d5b30e62-a6ee-4c2c-8570-41640619883e","block_type":"box","text":"other service providers (depending on the nature of the risk), subject to the supervision of the Manager. The Fund is","page_number":10,"box":{"x":69,"y":528,"width":828,"height":12}},{"id":"1e162a2c-16fb-4538-8fa1-1efab5b91eb0","block_type":"box","text":"subject to a number of risks, including investment, compliance, operational and valuation risks, among others. While","page_number":10,"box":{"x":69,"y":543,"width":832,"height":12}},{"id":"247a129a-6754-479d-bb68-c529484b347d","block_type":"box","text":"there are a number of risk management functions per formed by the Manager and the sub-advisers or other service","page_number":10,"box":{"x":68,"y":559,"width":820,"height":11}},{"id":"b4e75b62-b17c-4cf4-bdcb-b6e1e17ea427","block_type":"box","text":"providers, as applicable, it is not possible to eliminate all of the risks applicable to the Fund. Risk oversight forms","page_number":10,"box":{"x":70,"y":574,"width":811,"height":11}},{"id":"ee874aef-f0ce-46de-8bee-4cfa68b61d0d","block_type":"box","text":"par t of the Board’s general oversight of the Fund and is addressed as par t of various Board and Committee","page_number":10,"box":{"x":70,"y":589,"width":767,"height":11}},{"id":"b72bd17e-2e32-4e3e-9758-a4db0702d8e8","block_type":"box","text":"activities. The Board, directly or through a Committee, also reviews repor ts from, among others, management, the","page_number":10,"box":{"x":69,"y":604,"width":815,"height":11}},{"id":"8f8bfb82-143e-448c-b222-4900be67c509","block_type":"box","text":"independent registered public accounting firm for the Fund, sub-advisers and internal auditors for the investment","page_number":10,"box":{"x":70,"y":619,"width":803,"height":11}},{"id":"ff1a6eeb-35aa-42a7-8059-9b9d25d00da6","block_type":"box","text":"adviser or its affiliates, as appropriate, regarding risks faced by the Fund and management’s or the service provider’s","page_number":10,"box":{"x":69,"y":634,"width":840,"height":12}},{"id":"a4f1eaee-d74e-49bc-8d94-a9fcafa82c5e","block_type":"box","text":"risk functions. The Committee system facilitates the timely and efficient consideration of matters by the Trustees,","page_number":10,"box":{"x":69,"y":649,"width":812,"height":12}},{"id":"27a187a9-0f57-4daf-abe5-78579a638630","block_type":"box","text":"and facilitates effective oversight of compliance with legal and regulatory requirements and of the Fund’s activities","page_number":10,"box":{"x":69,"y":664,"width":817,"height":12}},{"id":"eb21629f-fbdd-4a61-ba7f-41681517ef05","block_type":"box","text":"and associated risks. The Board has appointed a Chief Compliance Officer, who oversees the implementation and","page_number":10,"box":{"x":69,"y":680,"width":812,"height":11}},{"id":"9d7edb3c-e02b-4b28-a742-58f15e6e6347","block_type":"box","text":"testing of the Trust’s compliance program and repor ts to the Board regarding compliance matters for the Fund and","page_number":10,"box":{"x":68,"y":695,"width":818,"height":11}},{"id":"62812058-6e9b-4746-bacd-f16618525f7b","block_type":"box","text":"its service providers. The Independent Trustees have engaged independent legal counsel to assist them in","page_number":10,"box":{"x":70,"y":710,"width":759,"height":11}},{"id":"818a1be6-4ebb-485a-8846-eddddb50462d","block_type":"box","text":"per forming their oversight responsibilities.","page_number":10,"box":{"x":70,"y":725,"width":299,"height":11}},{"id":"3843abe2-5a6b-4ad6-9996-f0b9da8901ce","block_type":"box","text":"Audit Committee.","page_number":10,"box":{"x":101,"y":748,"width":122,"height":9}},{"id":"e5a6a55f-304a-43c1-b6f3-3d329f985e78","block_type":"box","text":"The members of the Audit Committee (the “Audit Committee”) are Henry R. Keizer (Chair), Neil","page_number":10,"box":{"x":229,"y":748,"width":673,"height":11}},{"id":"c19352de-db65-4698-a359-f82b38eb1809","block_type":"box","text":"A. Cotty, Jeffrey Jarczyk, Lori Richards, Kenneth L. Urish and Claire A. Walton, all of whom are Independent Trustees.","page_number":10,"box":{"x":68,"y":763,"width":831,"height":11}},{"id":"6e49bdcd-3066-41dd-b12b-06914e7b64d2","block_type":"box","text":"The principal responsibilities of the Audit Committee are to approve, and recommend to the full Board for approval,","page_number":10,"box":{"x":68,"y":778,"width":820,"height":11}},{"id":"1e53a521-167e-495f-b629-b9a7dca8b6e6","block_type":"box","text":"the selection, retention, termination and compensation of the Fund’s independent registered public accounting firm","page_number":10,"box":{"x":68,"y":793,"width":823,"height":11}},{"id":"f96d2de1-ae07-4d85-912a-15e7a3565f8d","block_type":"box","text":"(the “Independent Registered Public Accounting Firm”) and to oversee the Independent Registered Public Accounting","page_number":10,"box":{"x":69,"y":808,"width":830,"height":11}},{"id":"927536f0-b78f-41e8-9310-d68b476feb83","block_type":"box","text":"Firm’s work. The Audit Committee’s responsibilities include, without limitation, to (1) evaluate the qualifications and","page_number":10,"box":{"x":70,"y":823,"width":825,"height":11}},{"id":"20b39c4e-88e0-4151-bf29-f4588b13adc2","block_type":"box","text":"independence of the Independent Registered Public Accounting Firm; (2) approve all audit engagement terms and","page_number":10,"box":{"x":70,"y":838,"width":807,"height":12}},{"id":"f302a37d-c67f-4545-898e-2f964e8ef0ca","block_type":"box","text":"fees for the Fund; (3) review the conduct and results of each independent audit of the Fund’s annual financial","page_number":10,"box":{"x":68,"y":853,"width":781,"height":11}},{"id":"6f440acf-03b5-4d84-bf88-a158e1311ac2","block_type":"box","text":"statements; (4) review any issues raised by the Independent Registered Public Accounting Firm or Fund management","page_number":10,"box":{"x":69,"y":869,"width":834,"height":11}},{"id":"c95e45b6-a125-411a-bc86-f4a824be69fd","block_type":"box","text":"regarding the accounting or financial repor ting policies and practices of the Fund and the internal controls of the Fund","page_number":10,"box":{"x":69,"y":884,"width":838,"height":11}},{"id":"2327de7f-8f17-4e51-8180-11410082d048","block_type":"box","text":"and cer tain service providers; (5) oversee the per formance of the Fund’s Independent Registered Public Accounting","page_number":10,"box":{"x":69,"y":899,"width":825,"height":11}},{"id":"26cda84e-f9e6-48aa-aff6-88ffbc7f9f3f","block_type":"box","text":"I-8","page_number":10,"box":{"x":481,"y":943,"width":17,"height":9}},{"id":"a8e409b5-fe0e-4e7e-bf42-766c38d250ae","block_type":"box","text":"NM1026U-5982568-10/232","page_number":10,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"915a30c9-bb3e-4505-9c15-dc9689d1a57c","block_type":"box","text":"Firm; (6) review and discuss with management and the Fund’s Independent Registered Public Accounting Firm the","page_number":11,"box":{"x":70,"y":45,"width":809,"height":11}},{"id":"f094e9e3-48b6-42cd-bbb2-8a58edbd27fb","block_type":"box","text":"per formance and findings of the Fund’s internal auditors; (7) discuss with Fund management its policies regarding","page_number":11,"box":{"x":70,"y":60,"width":815,"height":11}},{"id":"602c41ca-e913-49e2-b0ef-b5568bdf9876","block_type":"box","text":"risk assessment and risk management as such matters relate to the Fund’s financial repor ting and controls;","page_number":11,"box":{"x":69,"y":75,"width":774,"height":11}},{"id":"5d2a80dc-b1a3-4be1-8074-eedfbc1da1b2","block_type":"box","text":"(8) resolve any disagreements between Fund management and the Independent Registered Public Accounting Firm","page_number":11,"box":{"x":69,"y":90,"width":815,"height":11}},{"id":"c03f1e48-7e33-4729-8410-91971e2bacd8","block_type":"box","text":"regarding financial repor ting; and (9) under take such other duties and responsibilities as may from time to time be","page_number":11,"box":{"x":69,"y":105,"width":819,"height":11}},{"id":"a20347aa-c64d-47ee-a40d-333df1dd15d8","block_type":"box","text":"delegated by the Board to the Audit Committee. The Board has adopted a written char ter for the Audit Committee.","page_number":11,"box":{"x":69,"y":120,"width":812,"height":12}},{"id":"368ad646-bbed-4a49-b94d-09c1b5247d7b","block_type":"box","text":"During the fiscal year ended May 31, 2026, the Audit Committee met four times.","page_number":11,"box":{"x":70,"y":135,"width":574,"height":12}},{"id":"b0b22e1b-e29b-4de1-827b-250d85793223","block_type":"box","text":"Governance and Nominating Committee.","page_number":11,"box":{"x":102,"y":158,"width":286,"height":11}},{"id":"5fa1cdf7-bd72-45c0-8f35-be1cf2eff333","block_type":"box","text":"The members of the Governance and Nominating Committee (the","page_number":11,"box":{"x":394,"y":158,"width":464,"height":11}},{"id":"f8cd8bf8-4f37-4507-a1f0-517327093458","block_type":"box","text":"“Governance Committee”) are Cynthia A. Montgomery (Chair), Christopher J. Ailman, Susan J. Car ter, Collette Chilton,","page_number":11,"box":{"x":70,"y":173,"width":838,"height":11}},{"id":"9352607c-e452-4321-8dfe-8465faa9c85f","block_type":"box","text":"Henry R. Keizer and Marc D. Stern, all of whom are Independent Trustees. The principal responsibilities of the","page_number":11,"box":{"x":70,"y":188,"width":784,"height":11}},{"id":"bdccc087-72a5-4aca-9994-2ca444a57d68","block_type":"box","text":"Governance Committee are to (1) identify individuals qualified to serve as Independent Trustees of the Trust and","page_number":11,"box":{"x":69,"y":203,"width":803,"height":12}},{"id":"d47cd797-6263-4261-956c-6b399f27f470","block_type":"box","text":"recommend Independent Trustee nominees for election by shareholders or appointment by the Board; (2) advise the","page_number":11,"box":{"x":69,"y":218,"width":829,"height":12}},{"id":"4fe1250e-4f58-4635-b33b-f19527bfcb87","block_type":"box","text":"Board with respect to Board composition, procedures and committees (other than the Audit Committee); (3) oversee","page_number":11,"box":{"x":70,"y":234,"width":828,"height":11}},{"id":"1a448bdc-f049-4079-a4f9-ed0caffda4dc","block_type":"box","text":"periodic self-assessments of the Board and committees of the Board (other than the Audit Committee); (4) review","page_number":11,"box":{"x":70,"y":249,"width":809,"height":11}},{"id":"6724b082-705c-405a-bd33-548a4bbad5d7","block_type":"box","text":"and make recommendations regarding Independent Trustee compensation; (5) monitor corporate governance matters","page_number":11,"box":{"x":69,"y":264,"width":838,"height":11}},{"id":"99fff493-4675-4d5c-91f4-ff94569e0df0","block_type":"box","text":"and develop appropriate recommendations to the Board; (6) act as the administrative committee with respect to","page_number":11,"box":{"x":69,"y":279,"width":800,"height":11}},{"id":"c409c8f1-cf45-4699-802e-f427eb80427a","block_type":"box","text":"Board policies and procedures, committee policies and procedures (other than the Audit Committee) and codes of","page_number":11,"box":{"x":70,"y":294,"width":813,"height":11}},{"id":"c5b87952-a64e-492e-bff3-35bb2b49a9a4","block_type":"box","text":"ethics as they relate to Independent Trustees; and (7) under take such other duties and responsibilities as may from","page_number":11,"box":{"x":69,"y":309,"width":829,"height":11}},{"id":"2dcf7321-4e7b-459d-81dd-2ac04670cc74","block_type":"box","text":"time to time be delegated by the Board to the Governance Committee. The Governance Committee may consider","page_number":11,"box":{"x":68,"y":324,"width":804,"height":12}},{"id":"64fb66c3-42d8-4168-89cd-40b5d4f4c4ad","block_type":"box","text":"nominations for Trustees made by the Fund’s shareholders as it deems appropriate. Under the Trust’s Amended and","page_number":11,"box":{"x":69,"y":339,"width":832,"height":12}},{"id":"22a9d85b-9d7e-4acb-a11d-c11b7540a65b","block_type":"box","text":"Restated Code of Regulations (“Bylaws”), shareholders must follow cer tain procedures to nominate a person for","page_number":11,"box":{"x":70,"y":355,"width":801,"height":11}},{"id":"b832ce3d-6618-473c-97e5-f391f75a42ab","block_type":"box","text":"election as a Trustee at a shareholder meeting at which Trustees are to be elected. Under these advance notice","page_number":11,"box":{"x":69,"y":370,"width":799,"height":11}},{"id":"7ee57cbc-a94f-4fd7-a320-9ee3cc5f0cc9","block_type":"box","text":"procedures, notice of the proposed nominee to the Secretary of the Trust must be delivered to or mailed and","page_number":11,"box":{"x":70,"y":385,"width":776,"height":11}},{"id":"e8206a6a-419c-4ea0-83eb-09ac456d01b8","block_type":"box","text":"received at the principal executive offices of the Trust not later than the close of business on the fifth day following","page_number":11,"box":{"x":69,"y":400,"width":821,"height":11}},{"id":"99313851-407f-48fc-804c-8fb65032ff69","block_type":"box","text":"the day on which notice of the date of the meeting was mailed or public disclosure of the date of the meeting was","page_number":11,"box":{"x":68,"y":415,"width":812,"height":11}},{"id":"4cb4aa63-4914-4ea1-bf80-818d639da193","block_type":"box","text":"made, whichever first occurs. The Trust’s Bylaws provide that notice of a proposed nomination must include cer tain","page_number":11,"box":{"x":69,"y":430,"width":823,"height":11}},{"id":"f011f3df-c854-4a43-b885-cfde77e4c870","block_type":"box","text":"information about the shareholder and the nominee, as well as cer tain other information, including a written consent","page_number":11,"box":{"x":70,"y":445,"width":832,"height":12}},{"id":"05146ad8-62ce-462a-a458-dafcdb99ea83","block_type":"box","text":"of the proposed nominee to serve if elected. Reference is made to the Trust’s Bylaws for more details. The Board","page_number":11,"box":{"x":69,"y":460,"width":811,"height":12}},{"id":"24e5092e-133f-4946-b02d-3af00d7002e0","block_type":"box","text":"has adopted a written char ter for the Governance Committee. During the fiscal year ended May 31, 2026, the","page_number":11,"box":{"x":69,"y":475,"width":783,"height":12}},{"id":"67aa9293-4bc4-4805-b0ef-ec502f3ccb29","block_type":"box","text":"Governance Committee met ten times.","page_number":11,"box":{"x":69,"y":491,"width":274,"height":9}},{"id":"f8c1d9f5-2151-4b6e-bd84-a6c4f9486933","block_type":"box","text":"Compliance Committee.","page_number":11,"box":{"x":102,"y":513,"width":168,"height":11}},{"id":"49123b6f-59b2-4ddb-b7c0-fb870dade6cb","block_type":"box","text":"The members of the Compliance Committee (the “Compliance Committee”) are Claire A.","page_number":11,"box":{"x":276,"y":513,"width":629,"height":11}},{"id":"680ef4d8-1b59-4efe-b07b-6c16070307e7","block_type":"box","text":"Walton (Chair), Jeffrey Jarczyk, Cynthia A. Montgomery, Donald C. Opatrny, Lori Richards and Kenneth L. Urish, all of","page_number":11,"box":{"x":68,"y":528,"width":828,"height":12}},{"id":"418fff8d-74cc-4fcd-adb1-76b7e587649a","block_type":"box","text":"whom are Independent Trustees. The Compliance Committee’s purpose is to assist the Board in fulfilling its","page_number":11,"box":{"x":68,"y":543,"width":771,"height":12}},{"id":"2aed8cf3-e174-4175-925d-6ae48c9c57ed","block_type":"box","text":"responsibility to oversee regulatory and fiduciary compliance matters involving the Trust, the fund-related activities of","page_number":11,"box":{"x":69,"y":559,"width":835,"height":11}},{"id":"03fd17a7-e13c-49f9-ad20-ca2ce3341f8b","block_type":"box","text":"BlackRock and any sub-adviser and the Trust’s third-par ty service providers. The Compliance Committee’s","page_number":11,"box":{"x":70,"y":574,"width":754,"height":11}},{"id":"ff4a3a96-0fb8-41ba-879a-b847a4e4bb97","block_type":"box","text":"responsibilities include, without limitation, to (1) oversee the compliance policies and procedures of the Trust and its","page_number":11,"box":{"x":69,"y":589,"width":834,"height":11}},{"id":"3c48f269-9331-48e4-9f03-b014e1d5182d","block_type":"box","text":"service providers and recommend changes or additions to such policies and procedures; (2) review information on","page_number":11,"box":{"x":69,"y":604,"width":815,"height":11}},{"id":"49d1920f-f393-4f73-bf27-263a05d78a1d","block_type":"box","text":"and, where appropriate, recommend policies concerning the Trust’s compliance with applicable law; (3) review","page_number":11,"box":{"x":69,"y":619,"width":785,"height":11}},{"id":"d2eb1c4d-430a-4d29-a813-a495b3d04580","block_type":"box","text":"repor ts from, oversee the annual per formance review of, and make cer tain recommendations and determinations","page_number":11,"box":{"x":69,"y":634,"width":811,"height":11}},{"id":"033d24a2-ae5f-4c07-a494-333e9bc2003a","block_type":"box","text":"regarding the Trust’s Chief Compliance Officer (the “CCO”), including determining the amount and structure of the","page_number":11,"box":{"x":69,"y":649,"width":812,"height":12}},{"id":"19335e87-6107-4c13-b14d-3f26f899f780","block_type":"box","text":"CCO’s compensation and recommending such amount and structure to the full Board for approval and ratification;","page_number":11,"box":{"x":69,"y":664,"width":812,"height":12}},{"id":"b6f75735-57eb-4cfc-adc1-0742a2465c2e","block_type":"box","text":"and (4) under take such other duties and responsibilities as may from time to time be delegated by the Board to the","page_number":11,"box":{"x":69,"y":680,"width":825,"height":11}},{"id":"14ac077f-374e-45a2-a82b-5b01d41271b4","block_type":"box","text":"Compliance Committee. The Board has adopted a written char ter for the Compliance Committee. During the fiscal","page_number":11,"box":{"x":69,"y":695,"width":811,"height":11}},{"id":"65c75141-4d6f-4194-ae97-ba143859aef0","block_type":"box","text":"year ended May 31, 2026, the Compliance Committee met four times.","page_number":11,"box":{"x":68,"y":710,"width":502,"height":11}},{"id":"f3706e0e-34b2-469b-9a85-aaed8a08f047","block_type":"box","text":"Per formance Oversight Committee.","page_number":11,"box":{"x":102,"y":732,"width":248,"height":12}},{"id":"497e28b6-1e13-49cc-aa8b-2ab86002eb65","block_type":"box","text":"The members of the Per formance Oversight Committee (the “Per formance","page_number":11,"box":{"x":356,"y":732,"width":531,"height":12}},{"id":"1be65999-e497-426c-9436-ae386f2be8ba","block_type":"box","text":"Oversight Committee”) are Donald C. Opatrny (Chair), Christopher J. Ailman, Susan J. Car ter, Collette Chilton, Neil A.","page_number":11,"box":{"x":69,"y":748,"width":829,"height":11}},{"id":"ec8de909-fca7-4959-ac8c-4bf8371e0eef","block_type":"box","text":"Cotty and Marc D. Stern, all of whom are Independent Trustees. The Per formance Oversight Committee’s purpose is","page_number":11,"box":{"x":69,"y":763,"width":830,"height":11}},{"id":"c7cfa0fa-868f-4009-bbe3-10f43fa88627","block_type":"box","text":"to assist the Board in fulfilling its responsibility to oversee the Fund’s investment per formance relative to its agreed","page_number":11,"box":{"x":68,"y":778,"width":832,"height":11}},{"id":"dce01115-43cc-48fd-8c54-ce4944a9b729","block_type":"box","text":"upon per formance objectives and to assist the Independent Trustees in their consideration of investment advisory","page_number":11,"box":{"x":69,"y":793,"width":816,"height":11}},{"id":"be7c1abb-ab88-4ba5-807c-4d4d8a48296a","block_type":"box","text":"agreements. The Per formance Oversight Committee’s responsibilities include, without limitation, to (1) review","page_number":11,"box":{"x":69,"y":808,"width":782,"height":11}},{"id":"55201a81-c77f-4675-bb79-9a6d0748dc7b","block_type":"box","text":"information on, and make recommendations to the full Board in respect of, the Fund’s investment objective, policies","page_number":11,"box":{"x":70,"y":823,"width":829,"height":11}},{"id":"79acf82d-868a-42a3-a162-628f4fa7b742","block_type":"box","text":"and practices; (2) review information on the Fund’s investment per formance; (3) review information on appropriate","page_number":11,"box":{"x":69,"y":838,"width":816,"height":11}},{"id":"ee61e541-536b-4281-8c0a-0683e7c846f5","block_type":"box","text":"benchmarks and competitive universes and unusual or exceptional investment matters; (4) review personnel and","page_number":11,"box":{"x":69,"y":854,"width":803,"height":10}},{"id":"259eb291-4592-4cd6-895b-abf82c4073ee","block_type":"box","text":"other resources devoted to management of the Fund and evaluate the nature and quality of information furnished to","page_number":11,"box":{"x":69,"y":869,"width":827,"height":11}},{"id":"6614643e-aa05-4685-992d-e7370ee65fc4","block_type":"box","text":"the Per formance Oversight Committee; (5) recommend any required action regarding changes in fundamental and","page_number":11,"box":{"x":68,"y":884,"width":811,"height":11}},{"id":"e1c90bdf-5fd9-4648-bda6-663c244d6b6c","block_type":"box","text":"non-fundamental investment policies and restrictions, fund mergers or liquidations; (6) request and review","page_number":11,"box":{"x":69,"y":899,"width":757,"height":11}},{"id":"e9beb412-2dae-4eb1-8019-750bfe4a10c1","block_type":"box","text":"I-9","page_number":11,"box":{"x":481,"y":943,"width":17,"height":9}},{"id":"a5fbdbad-3cb5-47dd-b0a8-52b070d14d61","block_type":"box","text":"NM1026U-5982568-11/232","page_number":11,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"275adc4d-42d1-461d-91a8-d91f5cef6c44","block_type":"box","text":"information on the nature, extent and quality of services provided to the shareholders; (7) make recommendations to","page_number":12,"box":{"x":70,"y":45,"width":835,"height":11}},{"id":"8155e394-c5e3-454a-8f4f-8b03248c38b5","block_type":"box","text":"the Board concerning the approval or renewal of investment advisory agreements; and (8) under take such other","page_number":12,"box":{"x":68,"y":60,"width":800,"height":11}},{"id":"cd3c7fee-78a2-419c-a418-2319d7cd5f24","block_type":"box","text":"duties and responsibilities as may from time to time be delegated by the Board to the Per formance Oversight","page_number":12,"box":{"x":69,"y":75,"width":780,"height":11}},{"id":"880f34c4-738c-435d-9ce9-024602e9353d","block_type":"box","text":"Committee. The Board has adopted a written char ter for the Per formance Oversight Committee. During the fiscal year","page_number":12,"box":{"x":69,"y":90,"width":838,"height":11}},{"id":"f25e1301-e6f7-4fd5-8b47-f99d8f377551","block_type":"box","text":"ended May 31, 2026, the Per formance Oversight Committee met five times.","page_number":12,"box":{"x":69,"y":105,"width":544,"height":11}},{"id":"93656571-a7ed-468e-ac4c-d81b7868c7e4","block_type":"box","text":"Ad Hoc Topics Committee.","page_number":12,"box":{"x":101,"y":128,"width":186,"height":11}},{"id":"22daa017-34d5-4334-8b7d-1f64ebae37d7","block_type":"box","text":"The members of the Ad Hoc Topics Committee (the “Ad Hoc Topics Committee”) are","page_number":12,"box":{"x":293,"y":128,"width":598,"height":11}},{"id":"fa9afc94-6210-497d-9534-da133862f78a","block_type":"box","text":"Mark Stalnecker (Chair) and Claire A. Walton, both of whom are Independent Trustees, and John M. Perlowski, who","page_number":12,"box":{"x":70,"y":143,"width":817,"height":11}},{"id":"36d8de75-180a-496f-b6a7-08481606a185","block_type":"box","text":"serves as an interested Trustee. The principal responsibilities of the Ad Hoc Topics Committee are to (1) act on","page_number":12,"box":{"x":69,"y":158,"width":795,"height":11}},{"id":"7935853e-c70c-4974-98b9-9b42494043cc","block_type":"box","text":"routine matters between meetings of the Board; (2) act on such matters as may require urgent action between","page_number":12,"box":{"x":69,"y":173,"width":788,"height":11}},{"id":"3672b4b8-6a20-4a28-9a3e-24f035e50de4","block_type":"box","text":"meetings of the Board; and (3) exercise such other authority as may from time to time be delegated to the Ad Hoc","page_number":12,"box":{"x":69,"y":188,"width":813,"height":12}},{"id":"dbddb460-132b-44ca-b5ae-970dc9bf9572","block_type":"box","text":"Topics Committee by the Board. The Board has adopted a written char ter for the Ad Hoc Topics Committee. During","page_number":12,"box":{"x":68,"y":203,"width":816,"height":12}},{"id":"c15b421c-fbc4-41d9-9c8b-37253f6eb2da","block_type":"box","text":"the fiscal year ended May 31, 2026, the Ad Hoc Topics Committee did not meet.","page_number":12,"box":{"x":68,"y":218,"width":575,"height":12}},{"id":"6d21ab1a-d4ad-445c-bb4e-12f085680610","block_type":"box","text":"The Governance Committee has adopted a statement of policy that describes the experience, qualifications,","page_number":12,"box":{"x":101,"y":241,"width":771,"height":11}},{"id":"b090c2cd-86cf-4a1e-a4f4-60c3afa2fe8a","block_type":"box","text":"skills and attributes that are necessary and desirable for potential Independent Trustee candidates (the “Statement","page_number":12,"box":{"x":69,"y":256,"width":827,"height":11}},{"id":"b0eb25f0-92f8-4ece-8ba4-0d332c03ee1b","block_type":"box","text":"of Policy”). The Board believes that each Independent Trustee satisfied, at the time he or she was initially elected or","page_number":12,"box":{"x":69,"y":271,"width":830,"height":12}},{"id":"486be823-84a7-4b87-9207-af40cb2c60c2","block_type":"box","text":"appointed a Trustee, and continues to satisfy, the standards contemplated by the Statement of Policy. Fur thermore,","page_number":12,"box":{"x":69,"y":286,"width":825,"height":12}},{"id":"90f6c3b1-d5c8-4ce0-b1c8-ec1a9b64bb67","block_type":"box","text":"in determining that a par ticular Independent Trustee was and continues to be qualified to serve as a Trustee, the","page_number":12,"box":{"x":70,"y":302,"width":807,"height":11}},{"id":"46af097a-8aff-436e-8983-954baa055f91","block_type":"box","text":"Board has considered a variety of criteria, none of which, in isolation, was controlling. The Board believes that,","page_number":12,"box":{"x":70,"y":317,"width":787,"height":11}},{"id":"d6e0ad65-77c2-49e8-a103-4e3fdd920f77","block_type":"box","text":"collectively, the Independent Trustees have balanced and diverse experience, skills, attributes and qualifications,","page_number":12,"box":{"x":69,"y":332,"width":805,"height":11}},{"id":"e08d5c2b-1cc8-41a2-b028-a129a3706522","block_type":"box","text":"which allow the Board to operate effectively in governing the Trust and protecting the interests of shareholders.","page_number":12,"box":{"x":68,"y":347,"width":794,"height":11}},{"id":"ea788354-2cc4-4b18-bab1-5fc48d4bba88","block_type":"box","text":"Among the attributes common to all Independent Trustees are their ability to review critically, evaluate, question and","page_number":12,"box":{"x":68,"y":362,"width":829,"height":11}},{"id":"f46e1c9c-9264-4da7-b394-5db722cde520","block_type":"box","text":"discuss information provided to them, to interact effectively with the Fund’s investment adviser, sub-advisers, other","page_number":12,"box":{"x":69,"y":377,"width":823,"height":11}},{"id":"d6549bb3-871b-485d-93f3-159711136275","block_type":"box","text":"service providers, counsel and the Independent Registered Public Accounting Firm, and to exercise effective","page_number":12,"box":{"x":69,"y":392,"width":771,"height":12}},{"id":"080a0fa0-8aab-463d-b3ed-c71df5fda7fb","block_type":"box","text":"business judgment in the per formance of their duties as Trustees.","page_number":12,"box":{"x":69,"y":407,"width":473,"height":12}},{"id":"48100180-9241-47c6-943d-7518f1d66206","block_type":"box","text":"Each Trustee’s ability to per form his or her duties effectively is evidenced by his or her educational background","page_number":12,"box":{"x":102,"y":430,"width":792,"height":11}},{"id":"4c7ce9bb-c008-4817-bb4e-4dfa6bf745f1","block_type":"box","text":"or professional training; business, consulting, public service or academic positions; experience from service as a","page_number":12,"box":{"x":69,"y":445,"width":807,"height":12}},{"id":"1a59053f-3d7b-4195-ae57-6ef85ce4a3b0","block_type":"box","text":"board member of the Trust and the other funds in the BlackRock Fund Complexes (and any predecessor funds), other","page_number":12,"box":{"x":69,"y":460,"width":837,"height":12}},{"id":"58a096ad-84b8-49d3-b82f-f46a148932d1","block_type":"box","text":"investment funds, public companies, non-profit entities or other organizations; ongoing commitment to and","page_number":12,"box":{"x":70,"y":475,"width":759,"height":12}},{"id":"869a10a5-52a2-4bc2-b61f-e5c72c217b8b","block_type":"box","text":"par ticipation in Board and Committee meetings, as well as his or her leadership of standing and","page_number":12,"box":{"x":70,"y":491,"width":685,"height":11}},{"id":"cd3e369e-90c0-4751-8aee-23d805b3a499","block_type":"box","text":"ad hoc","page_number":12,"box":{"x":762,"y":491,"width":47,"height":9}},{"id":"2a4d5b9a-77a7-4eed-a701-4784a3e9ab53","block_type":"box","text":"committees","page_number":12,"box":{"x":814,"y":491,"width":82,"height":9}},{"id":"a4b4b895-9c52-441b-b2c0-88dde22c78d3","block_type":"box","text":"throughout the years; or other relevant life experiences.","page_number":12,"box":{"x":68,"y":506,"width":395,"height":11}},{"id":"69321ae6-6852-4090-ae86-d39acedd88f6","block_type":"box","text":"The table below discusses some of the experiences, qualifications and skills of each of the Trustees that","page_number":12,"box":{"x":101,"y":528,"width":751,"height":11}},{"id":"75f8e5c0-483d-4fad-97b7-f9f4fc9fe908","block_type":"box","text":"suppor t the conclusion that each Trustee should serve on the Board.","page_number":12,"box":{"x":69,"y":544,"width":492,"height":10}},{"id":"2fc540a7-aca6-4e05-a39f-26d3d66035de","block_type":"box","text":"Trustees Experience, Qualifications and Skills","page_number":12,"box":{"x":68,"y":572,"width":409,"height":9}},{"id":"8b7928ea-9c31-438f-b41b-8e790335b221","block_type":"box","text":"Independent Trustees","page_number":12,"box":{"x":70,"y":588,"width":154,"height":11}},{"id":"eed54d38-6944-4cc4-ba11-6cea49758ace","block_type":"box","text":"Christopher J. Ailman Christopher Ailman has more than 30 years of experience in the financial services","page_number":12,"box":{"x":69,"y":603,"width":781,"height":12}},{"id":"fddb4696-76d6-4c83-9f51-31ad2ae7fea7","block_type":"box","text":"industry, including most recently serving as Chief Investment Officer of the California","page_number":12,"box":{"x":265,"y":618,"width":604,"height":12}},{"id":"a5faddfe-b6b4-4109-bc03-81e78a4cd778","block_type":"box","text":"State Teachers Retirement System (CalSTRS) from 2000 to June 2024 where he led its","page_number":12,"box":{"x":265,"y":634,"width":623,"height":11}},{"id":"cb55d2e5-e771-4d29-9438-295ed9a74a27","block_type":"box","text":"investment program. Mr. Ailman currently is a principal at Ailman Advisers. In addition, he","page_number":12,"box":{"x":265,"y":649,"width":637,"height":11}},{"id":"5ad69413-f09c-43c5-a118-a8caa0bb7391","block_type":"box","text":"has held various roles in the industry, including as member and chair of the asset owner","page_number":12,"box":{"x":265,"y":664,"width":631,"height":11}},{"id":"c77e4045-1f6a-4347-9e4d-907f36b8948d","block_type":"box","text":"committee of the Kroner Center for Financial Research, chairman of the Nor th American","page_number":12,"box":{"x":264,"y":679,"width":626,"height":10}},{"id":"65471c08-68ac-46cd-9f51-7c59e016403f","block_type":"box","text":"Chapter of the 300 Club of Global CIOs, and co-chair of the Milken Global Capital Markets","page_number":12,"box":{"x":265,"y":694,"width":639,"height":11}},{"id":"b3928007-9911-499f-bfc6-29ecb634e387","block_type":"box","text":"Advisory Council. These positions have provided Mr. Ailman with considerable investment","page_number":12,"box":{"x":264,"y":709,"width":637,"height":11}},{"id":"1caa6fc8-0303-4bcb-b4ed-a54ac55b566f","block_type":"box","text":"exper tise across asset classes and strategies, and insight and perspective on the","page_number":12,"box":{"x":265,"y":725,"width":586,"height":11}},{"id":"fc4e4e97-c672-42df-89df-ae609eac79d5","block_type":"box","text":"markets and the economy. In addition, Mr. Ailman serves as a member of the Governance","page_number":12,"box":{"x":265,"y":739,"width":640,"height":12}},{"id":"9ca27fff-f204-4c0c-9289-e2ba3e5ac874","block_type":"box","text":"Committee and the Per formance Oversight Committee.","page_number":12,"box":{"x":265,"y":755,"width":389,"height":11}},{"id":"ad31c856-fdc0-46c9-b534-daa2e63d5490","block_type":"box","text":"I-10","page_number":12,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"95c5d93e-a16b-4b46-a2f7-c981d2537775","block_type":"box","text":"NM1026U-5982568-12/232","page_number":12,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"5907e10e-42b3-454f-bbeb-97c73ed56902","block_type":"box","text":"Trustees Experience, Qualifications and Skills","page_number":13,"box":{"x":68,"y":49,"width":409,"height":9}},{"id":"d9a7c91f-6ed9-4f35-a710-57a66f746821","block_type":"box","text":"Susan J. Car ter Susan J. Car ter has over 35 years of experience in investment management. She has","page_number":13,"box":{"x":69,"y":65,"width":806,"height":12}},{"id":"dde7598d-8011-4a8d-809b-8221b0f884a7","block_type":"box","text":"served as President & Chief Executive Officer of Commonfund Capital, Inc. (“CCI”), a","page_number":13,"box":{"x":265,"y":81,"width":604,"height":11}},{"id":"3b4a556b-a7e1-4d0a-9e0b-3f8aae4ac86c","block_type":"box","text":"registered investment adviser focused on non-profit investors, from 1997 to 2013, Chief","page_number":13,"box":{"x":265,"y":96,"width":632,"height":11}},{"id":"de7ac24a-d843-4d58-94a5-06d44e44aa62","block_type":"box","text":"Executive Officer of CCI from 2013 to 2014 and Senior Advisor to CCI in 2015.","page_number":13,"box":{"x":265,"y":111,"width":562,"height":9}},{"id":"330a4bfb-0443-426b-ab94-9bc1a57294cd","block_type":"box","text":"Ms. Car ter also served as director of the Pacific Pension Institute from 2014 to 2018,","page_number":13,"box":{"x":265,"y":126,"width":616,"height":10}},{"id":"6112d327-4cc3-4a8b-8e3d-476181b68bba","block_type":"box","text":"trustee to the Financial Accounting Foundation from 2017 to 2021, Advisory Board","page_number":13,"box":{"x":264,"y":141,"width":591,"height":11}},{"id":"851a692d-6ffa-4827-81d3-a7f441e0f90b","block_type":"box","text":"Member for the Center for Private Equity and Entrepreneurship at Tuck School of Business","page_number":13,"box":{"x":265,"y":156,"width":641,"height":11}},{"id":"fa98abfb-14be-4238-b455-933aecefb8ec","block_type":"box","text":"from 1997 to 2021, Advisory Board Member for Bridges Fund Management from 2016 to","page_number":13,"box":{"x":264,"y":171,"width":638,"height":12}},{"id":"0b2f1fb9-4400-4bef-8b79-ecf5756e1cb7","block_type":"box","text":"2018, Advisory Board Member for Girls Who Invest from 2015 to 2018 and Board","page_number":13,"box":{"x":265,"y":186,"width":584,"height":12}},{"id":"9078dea3-7ff0-42b6-b561-8e9ebcdad311","block_type":"box","text":"Member thereof from 2018 to 2022, and Practitioner Advisory Board Member for Private","page_number":13,"box":{"x":265,"y":201,"width":630,"height":12}},{"id":"ba444eae-8196-410e-975a-c1673ca1500e","block_type":"box","text":"Capital Research Institute (“PCRI”) from 2017 to 2024. She currently serves as Member","page_number":13,"box":{"x":265,"y":217,"width":634,"height":11}},{"id":"2a2cb39d-ac0f-42ec-a4a5-9cf3d9775caf","block_type":"box","text":"of the President’s Counsel for Commonfund. These positions have provided her with","page_number":13,"box":{"x":265,"y":232,"width":599,"height":11}},{"id":"b8855700-1204-417c-b054-c64db8ec85c9","block_type":"box","text":"insight and perspective on the markets and the economy.","page_number":13,"box":{"x":265,"y":247,"width":407,"height":11}},{"id":"c34fd89e-7eca-4930-9759-b78b5257d340","block_type":"box","text":"Collette Chilton Collette Chilton has over 20 years of experience in investment management. She held the","page_number":13,"box":{"x":69,"y":269,"width":837,"height":12}},{"id":"020325a5-8a9f-479c-9108-418e22c15586","block_type":"box","text":"position of Chief Investment Officer of Williams College from October 2006 to June 2023.","page_number":13,"box":{"x":265,"y":285,"width":638,"height":11}},{"id":"9ae468ff-5324-4444-a9bb-6d54404b72af","block_type":"box","text":"Prior to that she was President and Chief Investment Officer of Lucent Asset Management","page_number":13,"box":{"x":265,"y":300,"width":642,"height":11}},{"id":"9cb1fa19-ef1f-4bc6-9a1e-50f0649f354a","block_type":"box","text":"Corporation, where she oversaw approximately $40 billion in pension and retirement","page_number":13,"box":{"x":265,"y":314,"width":601,"height":12}},{"id":"5f4979b8-4e45-4198-b375-33b2051f1065","block_type":"box","text":"savings assets for the company. These positions have provided her with insight and","page_number":13,"box":{"x":265,"y":330,"width":595,"height":11}},{"id":"c3056041-a758-45bb-94d4-f0736cc142ca","block_type":"box","text":"perspective on the markets and the economy.","page_number":13,"box":{"x":265,"y":345,"width":323,"height":11}},{"id":"ee0bf513-11e0-4cff-8e16-256bd876a111","block_type":"box","text":"Neil A. Cotty Neil A. Cotty has more than 30 years of experience in the financial services industry,","page_number":13,"box":{"x":70,"y":368,"width":798,"height":11}},{"id":"581ac03a-8e6b-4cd8-8077-e6db06e33843","block_type":"box","text":"including 19 years at Bank of America Corporation and its affiliates, where he served, at","page_number":13,"box":{"x":265,"y":383,"width":631,"height":11}},{"id":"7754e3db-c373-45d5-9e6a-7650dade76dd","block_type":"box","text":"different times, as the Chief Financial Officer of various businesses including Investment","page_number":13,"box":{"x":265,"y":398,"width":633,"height":11}},{"id":"5c39f58a-ca27-4eec-aede-81997da56bfe","block_type":"box","text":"Banking, Global Markets, Wealth Management and Consumer and also served ten years","page_number":13,"box":{"x":265,"y":413,"width":628,"height":11}},{"id":"6fd20148-fa07-4472-bdf1-2c1012efce40","block_type":"box","text":"as the Chief Accounting Officer for Bank of America Corporation. Mr. Cotty has been","page_number":13,"box":{"x":265,"y":428,"width":596,"height":12}},{"id":"caadd022-d656-4524-a9c9-bc467145e00f","block_type":"box","text":"determined by the Audit Committee to be an audit committee financial exper t, as such","page_number":13,"box":{"x":265,"y":443,"width":616,"height":12}},{"id":"c33a3d05-d313-4cea-91d8-c9b8d950f488","block_type":"box","text":"term is defined in the applicable Commission rules.","page_number":13,"box":{"x":264,"y":458,"width":368,"height":11}},{"id":"e8712064-1e6a-4c4f-a254-1c3a2b18d461","block_type":"box","text":"Jeffrey Jarczyk Jeffrey Jarczyk is a CPA and has more than 30 years of experience in the financial","page_number":13,"box":{"x":69,"y":481,"width":777,"height":11}},{"id":"6147f6f7-a709-4402-bbdd-ead9105a762d","block_type":"box","text":"services industry, including over 19 years at Fidelity Investments, where he served, at","page_number":13,"box":{"x":265,"y":496,"width":613,"height":12}},{"id":"19f8f8bf-8291-44c6-9760-4950a3266b7f","block_type":"box","text":"different times, as the Chief Auditor and the Chief Accounting Officer of Fidelity","page_number":13,"box":{"x":265,"y":511,"width":563,"height":12}},{"id":"cd6fb63c-d9b0-4beb-947c-e821df1715f5","block_type":"box","text":"Investments’ parent company, FMR LLC. Prior to working at Fidelity, Mr. Jarczyk was a","page_number":13,"box":{"x":265,"y":527,"width":607,"height":11}},{"id":"197a1103-7d3e-4650-adec-302637fb06aa","block_type":"box","text":"par tner at Deloitte and Ar thur Andersen for approximately 17 years. These positions have","page_number":13,"box":{"x":265,"y":542,"width":638,"height":11}},{"id":"645e6f92-21fa-4959-827c-ae3173b4e865","block_type":"box","text":"allowed him to work extensively with audit and risk committees and company executives","page_number":13,"box":{"x":265,"y":557,"width":626,"height":11}},{"id":"4e8ddb1a-438d-4672-892e-e7ea6db64097","block_type":"box","text":"helping to identify, manage and mitigate risks for financial services companies.","page_number":13,"box":{"x":265,"y":572,"width":563,"height":11}},{"id":"23f0de90-713b-43b3-8c84-c5944cd18a60","block_type":"box","text":"Mr. Jarczyk also served as consultant to the Independent Trustees prior to becoming an","page_number":13,"box":{"x":265,"y":587,"width":625,"height":11}},{"id":"e28efb4b-392d-41af-b8b3-b5778fa204cb","block_type":"box","text":"Independent Trustee. Mr. Jarczyk has been determined by the Audit Committee to be an","page_number":13,"box":{"x":265,"y":602,"width":625,"height":11}},{"id":"89802169-f1da-4fba-81f8-45e0caf2217d","block_type":"box","text":"audit committee financial exper t, as such term is defined in the applicable Commission","page_number":13,"box":{"x":265,"y":617,"width":623,"height":11}},{"id":"a0d6abc3-1b2c-434c-bbb1-e61916fcd765","block_type":"box","text":"rules.","page_number":13,"box":{"x":265,"y":633,"width":38,"height":8}},{"id":"13f31d4a-b8df-49a1-8a44-b682ae1ac0be","block_type":"box","text":"Henry R. Keizer Henry R. Keizer brings over 40 years of executive, financial, operational, strategic and","page_number":13,"box":{"x":70,"y":655,"width":806,"height":11}},{"id":"9254448a-e4f7-4b31-94f7-d170752daa00","block_type":"box","text":"global exper tise gained through his 35 year career at KPMG, a global professional","page_number":13,"box":{"x":264,"y":670,"width":584,"height":11}},{"id":"9a5fdb0c-4f7d-4d6f-a37c-4d01da9fc52f","block_type":"box","text":"services organization and by his service as a director to both publicly and privately held","page_number":13,"box":{"x":265,"y":686,"width":622,"height":11}},{"id":"eb3c00cb-e499-4a46-a258-09eb4b3b9bf5","block_type":"box","text":"organizations. He has extensive experience with issues facing complex, global companies","page_number":13,"box":{"x":265,"y":700,"width":638,"height":12}},{"id":"f65996cf-1298-4933-abf9-31f120824ec4","block_type":"box","text":"and exper tise in financial repor ting, accounting, auditing, risk management, and","page_number":13,"box":{"x":265,"y":715,"width":570,"height":12}},{"id":"b5390778-cbe2-4ba0-92a7-d662dad537b8","block_type":"box","text":"regulatory affairs for such companies. Mr. Keizer’s experience also includes service as an","page_number":13,"box":{"x":265,"y":731,"width":642,"height":11}},{"id":"e9895c68-194a-4ffe-80cf-3fff4f01581d","block_type":"box","text":"audit committee chair to both publicly and privately held organizations across numerous","page_number":13,"box":{"x":265,"y":746,"width":626,"height":11}},{"id":"7aa5da5f-f4a3-484f-b78e-1e48e7ab90eb","block_type":"box","text":"industries including professional services, proper ty and casualty reinsurance, insurance,","page_number":13,"box":{"x":265,"y":761,"width":630,"height":11}},{"id":"038d2980-6e82-44a2-8e2f-05a7a79f8049","block_type":"box","text":"diversified financial services, banking, direct to consumer, business to business and","page_number":13,"box":{"x":265,"y":776,"width":602,"height":11}},{"id":"12965010-524b-4cbe-b096-f90399985d2d","block_type":"box","text":"technology. Mr. Keizer is a cer tified public accountant and also served on the board of the","page_number":13,"box":{"x":264,"y":791,"width":643,"height":11}},{"id":"7a27ae1f-a9db-4972-bbb7-5979372c0227","block_type":"box","text":"American Institute of Cer tified Public Accountants. Mr. Keizer has been determined by the","page_number":13,"box":{"x":264,"y":806,"width":639,"height":11}},{"id":"63d5cd6a-c983-4d9e-a56c-85c42dbf82c9","block_type":"box","text":"Audit Committee to be an audit committee financial exper t, as such term is defined in the","page_number":13,"box":{"x":264,"y":821,"width":641,"height":11}},{"id":"c2e520fb-2acd-4c4c-bb5e-c61061d71e7c","block_type":"box","text":"applicable Commission rules.","page_number":13,"box":{"x":265,"y":837,"width":208,"height":10}},{"id":"86e3249c-5182-46cd-aa05-874fabcf69d6","block_type":"box","text":"I-11","page_number":13,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"8c7af8d4-eb50-4e34-a6f3-2db449e3fbae","block_type":"box","text":"NM1026U-5982568-13/232","page_number":13,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"ac477109-93f5-4421-a62b-bd0caabf87b8","block_type":"box","text":"Trustees Experience, Qualifications and Skills","page_number":14,"box":{"x":68,"y":49,"width":409,"height":9}},{"id":"e6a15f8e-122a-4d36-bbd2-b68c990bf521","block_type":"box","text":"Cynthia A. Montgomery Cynthia A. Montgomery has served for over 20 years on the boards of registered","page_number":14,"box":{"x":69,"y":65,"width":769,"height":12}},{"id":"98b43cc5-3ef7-45cc-bd89-339b9b975caf","block_type":"box","text":"investment companies, most recently as a member of the boards of cer tain BlackRock","page_number":14,"box":{"x":265,"y":81,"width":621,"height":11}},{"id":"f7b2d7da-7437-40e8-af6c-050b0e6fcf20","block_type":"box","text":"advised Funds and predecessor funds, including the legacy Merrill Lynch Investment","page_number":14,"box":{"x":265,"y":96,"width":599,"height":11}},{"id":"f6860966-9351-4f87-ba10-bbcc6f45a1c9","block_type":"box","text":"Managers, L.P. (“MLIM”) funds. The Board benefits from Ms. Montgomery’s more than 20","page_number":14,"box":{"x":265,"y":111,"width":641,"height":11}},{"id":"fada9601-fab3-444a-897d-5d35cea36a36","block_type":"box","text":"years of academic experience as a professor at Harvard Business School where she","page_number":14,"box":{"x":264,"y":126,"width":602,"height":11}},{"id":"eb483682-20e5-4b7a-a8ff-408eaef4fcb3","block_type":"box","text":"taught courses on corporate strategy and corporate governance. Ms. Montgomery also","page_number":14,"box":{"x":264,"y":141,"width":617,"height":11}},{"id":"a22d8c19-1953-4629-8290-2ebc7fb31c04","block_type":"box","text":"has business management and corporate governance experience through her service on","page_number":14,"box":{"x":265,"y":156,"width":629,"height":11}},{"id":"3b2588bd-abce-41c9-b94b-fc583b5552e1","block_type":"box","text":"the corporate boards of a variety of public companies. She has also authored numerous","page_number":14,"box":{"x":264,"y":171,"width":628,"height":11}},{"id":"e1b644f9-8b13-400e-9c84-7663f0420b6a","block_type":"box","text":"ar ticles and books on these topics.","page_number":14,"box":{"x":265,"y":187,"width":251,"height":10}},{"id":"9a7507f1-c46a-4fc8-9c2d-3ee11c6353ad","block_type":"box","text":"Donald C. Opatrny Donald C. Opatrny has more than 40 years of business, oversight and executive","page_number":14,"box":{"x":70,"y":209,"width":764,"height":11}},{"id":"a68762ed-8c4e-4f03-858e-e5f5437ede65","block_type":"box","text":"experience, including through his service as president, director and investment committee","page_number":14,"box":{"x":265,"y":224,"width":642,"height":11}},{"id":"97e89ed9-82f6-43b6-b873-282303b86ce6","block_type":"box","text":"chair for academic and not-for-profit organizations, and his experience as a par tner,","page_number":14,"box":{"x":264,"y":239,"width":593,"height":12}},{"id":"3c73b4fb-e698-4b6a-90dc-bb6037a258c8","block_type":"box","text":"managing director and advisory director at Goldman Sachs for 32 years. He also has","page_number":14,"box":{"x":265,"y":254,"width":603,"height":12}},{"id":"3212ed39-001f-458a-b6f0-f5dd5c99605e","block_type":"box","text":"investment management experience as a board member of Athena Capital Advisors LLC.","page_number":14,"box":{"x":265,"y":269,"width":629,"height":12}},{"id":"866a18f4-91ca-47ee-bdb4-2aeb29987680","block_type":"box","text":"Lori Richards Lori Richards has more than 30 years of experience in the financial services industry,","page_number":14,"box":{"x":70,"y":292,"width":804,"height":11}},{"id":"74e34f69-c7a9-46f1-b7b5-9d380d40e638","block_type":"box","text":"most notably as the first Director of the Office of Compliance Inspections and","page_number":14,"box":{"x":265,"y":307,"width":552,"height":11}},{"id":"aa955138-ceb9-49f7-a2ff-12c9546f6c52","block_type":"box","text":"Examinations (“OCIE”) of the Securities and Exchange Commission (“SEC”) from 1995 to","page_number":14,"box":{"x":265,"y":322,"width":636,"height":12}},{"id":"fd448765-8903-4e4e-a56c-4d50235bc7ee","block_type":"box","text":"2009. During 14 years as the Director of OCIE, she led the SEC’s nationwide examination","page_number":14,"box":{"x":265,"y":338,"width":639,"height":11}},{"id":"8c12d862-8314-47cb-a1ab-20cbf9447483","block_type":"box","text":"oversight program for advisers, mutual funds, hedge funds, broker-dealers, stock","page_number":14,"box":{"x":265,"y":353,"width":576,"height":11}},{"id":"5281c4d9-345a-4644-8519-bddf4ff71fa7","block_type":"box","text":"exchanges, and other industry firms. Prior to that, from 1985 to 1995, she held various","page_number":14,"box":{"x":265,"y":368,"width":626,"height":11}},{"id":"b4092c49-c08c-46b4-988d-0241d71127ef","block_type":"box","text":"roles at the SEC, including Associate Director for Enforcement for the SEC’s Pacific","page_number":14,"box":{"x":265,"y":383,"width":592,"height":11}},{"id":"4d332ea4-15db-4f0e-b1d1-6af606540b68","block_type":"box","text":"Regional Office and executive assistant and senior advisor to then SEC Chairman Ar thur","page_number":14,"box":{"x":265,"y":398,"width":629,"height":11}},{"id":"24d54f48-97f2-4f40-b89d-99d327414809","block_type":"box","text":"Levitt. More recently, Ms. Richards served as Chief Compliance Officer of the Asset and","page_number":14,"box":{"x":265,"y":413,"width":626,"height":11}},{"id":"626f67b1-fb72-4a06-8c82-ee74d31a2732","block_type":"box","text":"Wealth Management global lines of business at JPMorgan Chase & Co. from 2013 to","page_number":14,"box":{"x":264,"y":428,"width":608,"height":12}},{"id":"fec56a31-2c85-4a20-bdc0-4d2f84128ac2","block_type":"box","text":"2018 where she led its global compliance program, advised business leaders on","page_number":14,"box":{"x":265,"y":443,"width":575,"height":12}},{"id":"dbf3bc1b-ec4b-478b-9a6b-4d99f4f733f0","block_type":"box","text":"compliance issues, oversaw risk assessment, monitoring, testing and training, and","page_number":14,"box":{"x":264,"y":459,"width":591,"height":11}},{"id":"eaabae1b-7cba-4ab1-bade-8d2ba812422d","block_type":"box","text":"maintained relationships with regulators. In addition, Ms. Richards served as a member","page_number":14,"box":{"x":265,"y":474,"width":627,"height":11}},{"id":"b2384bb7-e0d4-4c4a-a5e3-f363fcd6bf15","block_type":"box","text":"of the National Adjudicatory Council of the Financial Industry Regulatory Authority","page_number":14,"box":{"x":265,"y":489,"width":578,"height":11}},{"id":"a87b4cf8-aea2-4586-9fdc-53b9d6f0aa72","block_type":"box","text":"(FINRA) from 2019 to 2022 and held the chair and vice chair posts during her tenure.","page_number":14,"box":{"x":265,"y":504,"width":607,"height":11}},{"id":"2402fcb8-fe37-48df-9153-ada1f32dc178","block_type":"box","text":"Prior thereto, from 2010 to 2013, she was a Principal at PricewaterhouseCoopers LLP","page_number":14,"box":{"x":265,"y":519,"width":615,"height":11}},{"id":"3e1c6e1e-8d09-4daf-95d3-99e54a341ea0","block_type":"box","text":"(“PwC”) and co-leader of its Asset Management Regulatory group. At PwC, she assisted a","page_number":14,"box":{"x":265,"y":534,"width":638,"height":11}},{"id":"df9fc8aa-6fb7-4667-8989-570de8158ab7","block_type":"box","text":"broad range of financial services clients in designing and implementing risk management","page_number":14,"box":{"x":265,"y":549,"width":635,"height":11}},{"id":"b7640c2d-1b59-41f9-8b1c-b2143f80050a","block_type":"box","text":"and compliance programs, and preparing for new regulatory expectations. These positions","page_number":14,"box":{"x":265,"y":564,"width":642,"height":12}},{"id":"48e22406-4fbd-4225-a5dc-5a3d4484db20","block_type":"box","text":"have provided her with insight and perspective on the markets and the economy, as well","page_number":14,"box":{"x":265,"y":580,"width":627,"height":11}},{"id":"2683f3a1-58e0-4021-a495-f39fe6af0a76","block_type":"box","text":"as asset management regulation and compliance. In addition, Ms. Richards serves as a","page_number":14,"box":{"x":265,"y":595,"width":628,"height":11}},{"id":"30589f95-4245-44d4-a2f2-087e3c77942c","block_type":"box","text":"member of the Audit Committee and the Compliance Committee.","page_number":14,"box":{"x":265,"y":610,"width":460,"height":11}},{"id":"60dff5b1-5e4b-4c7e-928a-e542f8be6df4","block_type":"box","text":"Mark Stalnecker Mark Stalnecker has gained a wealth of experience in investing and asset management","page_number":14,"box":{"x":70,"y":632,"width":818,"height":12}},{"id":"2749f4bd-50c0-4a5f-8d63-536ff770f9d5","block_type":"box","text":"from his over 13 years of service as the Chief Investment Officer of the University of","page_number":14,"box":{"x":264,"y":647,"width":603,"height":12}},{"id":"43959d66-bca6-4b67-8f55-c28b5e6152d3","block_type":"box","text":"Delaware as well as from his various positions with First Union Corporation, including","page_number":14,"box":{"x":265,"y":663,"width":606,"height":11}},{"id":"44f169eb-cef4-4f01-82b9-8cce2930c24e","block_type":"box","text":"Senior Vice President and State Investment Director of First Investment Advisors. The","page_number":14,"box":{"x":265,"y":678,"width":608,"height":9}},{"id":"ef91a9af-869e-4c72-ae7b-983586880a9a","block_type":"box","text":"Board benefits from his experience and perspective as the Chief Investment Officer of a","page_number":14,"box":{"x":265,"y":693,"width":626,"height":11}},{"id":"c8ce0af1-f5d8-4c7b-b297-b04d54853530","block_type":"box","text":"university endowment and from the oversight experience he gained from service on","page_number":14,"box":{"x":265,"y":708,"width":591,"height":11}},{"id":"a733e8a2-ecc7-4cb5-8333-fca07bc38ef7","block_type":"box","text":"various private and non-profit boards.","page_number":14,"box":{"x":264,"y":723,"width":265,"height":11}},{"id":"c27f167c-dc30-452d-ad32-18579d73a71c","block_type":"box","text":"Marc D. Stern Marc D. Stern has more than 30 years of experience in investing and asset management.","page_number":14,"box":{"x":70,"y":746,"width":833,"height":11}},{"id":"9ccea7d2-8545-4f45-b013-230c05b1714e","block_type":"box","text":"Mr. Stern served as the Chief Executive Officer at Bessemer Trust, a wealth management","page_number":14,"box":{"x":265,"y":761,"width":638,"height":11}},{"id":"fd6c99f4-0b17-48eb-a343-8a123c9407e0","block_type":"box","text":"business, for 13 years. During his tenure at Bessemer Trust, Mr. Stern served on the","page_number":14,"box":{"x":265,"y":776,"width":608,"height":11}},{"id":"8bab5623-294e-4a8a-9e34-d5fa49cb20a3","block_type":"box","text":"firm’s board of directors, chaired the board’s trust and investment committee, and led the","page_number":14,"box":{"x":264,"y":791,"width":645,"height":11}},{"id":"f687c667-9bd7-47ad-b573-0b1983b49f82","block_type":"box","text":"firm’s executive committee. He also served as Bessemer’s Chief Investment Officer for 8","page_number":14,"box":{"x":264,"y":806,"width":639,"height":9}},{"id":"08bd2ee8-f1fd-4162-9369-9df544146687","block_type":"box","text":"years, where he was Chair of the Investment Policy and Strategy Committee with","page_number":14,"box":{"x":264,"y":821,"width":573,"height":12}},{"id":"e63a1a41-bc31-434e-9f15-1498efd5213d","block_type":"box","text":"responsibility for overall asset allocation and investment strategy. Mr. Stern also served","page_number":14,"box":{"x":265,"y":836,"width":625,"height":12}},{"id":"514c22b9-4973-4d30-81d4-2588d85d0026","block_type":"box","text":"as Chair of the Private Clients Investment group at AllianceBernstein. These positions","page_number":14,"box":{"x":265,"y":852,"width":610,"height":11}},{"id":"0432695a-1463-4410-8f18-18bf8fd75336","block_type":"box","text":"provide Mr. Stern with insight and perspective into investment management, the economy,","page_number":14,"box":{"x":265,"y":867,"width":642,"height":11}},{"id":"5e6abc68-5bf2-4dba-a957-0e12985c566c","block_type":"box","text":"and fiduciary governance. Mr. Stern also served as consultant to the Independent","page_number":14,"box":{"x":265,"y":882,"width":583,"height":11}},{"id":"8b8ca645-c275-4fb5-98c4-1c6c155b3c99","block_type":"box","text":"Trustees prior to becoming an Independent Trustee.","page_number":14,"box":{"x":264,"y":897,"width":369,"height":11}},{"id":"91ba96cc-1d83-42d8-a757-e160befef4ce","block_type":"box","text":"I-12","page_number":14,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"e9ba108e-9f54-4040-9127-00c7f1af0e67","block_type":"box","text":"NM1026U-5982568-14/232","page_number":14,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"35e9ed20-e4cc-4f91-b61b-5a5c297276a4","block_type":"box","text":"Trustees Experience, Qualifications and Skills","page_number":15,"box":{"x":68,"y":49,"width":409,"height":9}},{"id":"d16f6d5a-25a2-4b08-8565-b4480d763623","block_type":"box","text":"Kenneth L. Urish Kenneth L. Urish has served for over 15 years on the boards of registered investment","page_number":15,"box":{"x":70,"y":65,"width":807,"height":12}},{"id":"bef91d5a-9b7b-424d-82fb-7318c811fb08","block_type":"box","text":"companies, most recently as a member of the boards of cer tain BlackRock-advised Funds","page_number":15,"box":{"x":264,"y":81,"width":641,"height":11}},{"id":"4c46c628-0f8e-4da9-a401-a166186afb4a","block_type":"box","text":"and predecessor funds, including the legacy BlackRock funds. He has over 30 years of","page_number":15,"box":{"x":265,"y":96,"width":618,"height":11}},{"id":"ed0ecc5b-e1f8-4321-8171-8d5dc01433bf","block_type":"box","text":"experience in public accounting. Mr. Urish has served as a managing member of an","page_number":15,"box":{"x":265,"y":111,"width":594,"height":11}},{"id":"08833058-7a22-474c-b176-d5d9902da923","block_type":"box","text":"accounting and consulting firm. Mr. Urish has been determined by the Audit Committee to","page_number":15,"box":{"x":265,"y":126,"width":639,"height":11}},{"id":"76089cae-f77b-4127-a1f9-9b7c7fd234c2","block_type":"box","text":"be an audit committee financial exper t, as such term is defined in the applicable","page_number":15,"box":{"x":265,"y":141,"width":575,"height":11}},{"id":"27991a03-4739-4d13-bcbd-0a410dd5343b","block_type":"box","text":"Commission rules.","page_number":15,"box":{"x":265,"y":156,"width":131,"height":9}},{"id":"f7886c91-d1a1-45fa-8759-a3d7df82a5a7","block_type":"box","text":"Claire A. Walton Claire A. Walton has over 25 years of experience in investment management. She has","page_number":15,"box":{"x":69,"y":179,"width":808,"height":11}},{"id":"2aa44e74-5b74-4860-b1ca-8bef139ac695","block_type":"box","text":"served as the Chief Operating Officer and Chief Financial Officer of Liber ty Square Asset","page_number":15,"box":{"x":265,"y":194,"width":630,"height":11}},{"id":"edbf4387-9085-4dcd-8754-9911177fc7d4","block_type":"box","text":"Management, LP / Steel Par tners Japan Asset Management, LP from 1998 to 2015, an","page_number":15,"box":{"x":265,"y":209,"width":627,"height":11}},{"id":"a435c366-eca6-4c39-abd7-3aa62874ae69","block_type":"box","text":"investment manager that specialized in long/shor t non-U.S. equity investments, and was","page_number":15,"box":{"x":265,"y":224,"width":632,"height":11}},{"id":"c2ce523c-3326-467e-bc63-15bdc707e8d2","block_type":"box","text":"an owner and General Par tner of Neon Liber ty Capital Management, LLC from 2003 to","page_number":15,"box":{"x":265,"y":239,"width":615,"height":12}},{"id":"6c1846cc-c683-4b63-8a16-b1e1a045504d","block_type":"box","text":"2023, a firm focusing on long/shor t equities in global emerging and frontier markets.","page_number":15,"box":{"x":265,"y":254,"width":608,"height":12}},{"id":"454793ec-8120-41f1-b981-241533f8785b","block_type":"box","text":"These positions have provided her with insight and perspective on the markets and the","page_number":15,"box":{"x":264,"y":270,"width":620,"height":11}},{"id":"10673315-3ac1-4ac7-8964-d3e74b31d793","block_type":"box","text":"economy. Ms. Walton has been determined by the Audit Committee to be an audit","page_number":15,"box":{"x":265,"y":285,"width":584,"height":11}},{"id":"03cf4bbe-27c4-4e7f-8904-5395e6874fac","block_type":"box","text":"committee financial exper t, as such term is defined in the applicable Commission rules.","page_number":15,"box":{"x":264,"y":300,"width":629,"height":11}},{"id":"f705c0a2-57b1-42de-b062-b6b310e3382a","block_type":"box","text":"Interested Trustees","page_number":15,"box":{"x":70,"y":323,"width":138,"height":8}},{"id":"572552a3-1ab9-4065-919c-819c3027f551","block_type":"box","text":"Rober t Fairbairn Rober t Fairbairn has more than 25 years of experience with BlackRock, Inc. and over 30","page_number":15,"box":{"x":70,"y":338,"width":823,"height":11}},{"id":"36343b1c-b020-4b7a-9406-a4e7fd9f4afe","block_type":"box","text":"years of experience in finance and asset management. In par ticular, Mr. Fairbairn’s","page_number":15,"box":{"x":264,"y":353,"width":593,"height":11}},{"id":"40c1edd9-6e47-4604-9f8f-31cbc61ddaa1","block_type":"box","text":"positions as Vice Chairman of BlackRock, Inc., Member of BlackRock’s Global Operating","page_number":15,"box":{"x":265,"y":368,"width":629,"height":11}},{"id":"a8110c78-d6c9-4c0b-91aa-5f21cacd565e","block_type":"box","text":"Committee and Co-Chair of BlackRock’s Human Capital Committee provide the Board with","page_number":15,"box":{"x":265,"y":383,"width":639,"height":11}},{"id":"a14bdc25-c13c-4898-9f86-ad5765722c7a","block_type":"box","text":"a wealth of practical business knowledge and leadership. In addition, Mr. Fairbairn has","page_number":15,"box":{"x":265,"y":398,"width":617,"height":11}},{"id":"e2b43e7d-94fc-4ba9-a5a3-d6eb9abe9183","block_type":"box","text":"global investment management and oversight experience through his former positions as","page_number":15,"box":{"x":264,"y":413,"width":634,"height":11}},{"id":"592a428c-919a-45be-b6f5-217159334f1e","block_type":"box","text":"Member of BlackRock’s Global Executive Committee, Global Head of BlackRock’s Retail","page_number":15,"box":{"x":265,"y":428,"width":624,"height":11}},{"id":"cdf39700-5367-4a87-be22-13fd6a9395fd","block_type":"box","text":"and iShares","page_number":15,"box":{"x":265,"y":443,"width":84,"height":9}},{"id":"8b97c72e-9db4-40d1-b1b2-3421edd7819c","block_type":"box","text":"®","page_number":15,"box":{"x":350,"y":444,"width":6,"height":4}},{"id":"f11932a5-e3a0-4d9f-a7ca-dae2c0b6d624","block_type":"box","text":"businesses, Head of BlackRock’s Global Client Group, Chairman of","page_number":15,"box":{"x":362,"y":443,"width":478,"height":11}},{"id":"816a4c41-19e4-42e1-9e9f-32d8e5ce2c65","block_type":"box","text":"BlackRock’s international businesses and his previous oversight over BlackRock’s","page_number":15,"box":{"x":265,"y":459,"width":585,"height":11}},{"id":"c5285721-1ca8-46f9-b640-fa8493085fd3","block_type":"box","text":"Strategic Par tner Program and Strategic Product Management Group. Mr. Fairbairn also","page_number":15,"box":{"x":265,"y":474,"width":620,"height":11}},{"id":"fe5206ff-fc6f-4484-8956-006ded9ed1c1","block_type":"box","text":"serves as a board member for the funds in the BlackRock Fixed-Income Complex.","page_number":15,"box":{"x":265,"y":489,"width":578,"height":11}},{"id":"33bffd06-80ff-4978-a609-79a0dd329e8e","block_type":"box","text":"John M. Perlowski John M. Perlowski’s experience as Senior Managing Director of BlackRock, Inc. since","page_number":15,"box":{"x":69,"y":511,"width":800,"height":12}},{"id":"b3ff20ed-9353-47b7-b09d-05af1bd5efca","block_type":"box","text":"2026, as Managing Director of BlackRock, Inc. from 2009 to 2025, as the Head of","page_number":15,"box":{"x":265,"y":526,"width":593,"height":12}},{"id":"4de6584b-b592-4091-9713-9af4a40dbd03","block_type":"box","text":"BlackRock Global Business Operations Services since 2009, and as President and Chief","page_number":15,"box":{"x":265,"y":542,"width":633,"height":11}},{"id":"c2db45ef-a146-40a4-ae6d-1eeebc5b86c4","block_type":"box","text":"Executive Officer of the BlackRock-advised Funds provides him with a strong","page_number":15,"box":{"x":265,"y":557,"width":542,"height":11}},{"id":"c9057744-4408-4c42-85cb-01b92641c2b5","block_type":"box","text":"understanding of the BlackRock-advised Funds, their operations, and the business and","page_number":15,"box":{"x":265,"y":572,"width":617,"height":11}},{"id":"69ddff57-4f3e-4062-a266-ec285fc9304b","block_type":"box","text":"regulatory issues facing the BlackRock-advised Funds. Mr. Perlowski’s prior position as","page_number":15,"box":{"x":265,"y":587,"width":620,"height":11}},{"id":"96db7743-36ba-4827-a74e-155621d32732","block_type":"box","text":"Managing Director and Chief Operating Officer of the Global Product Group at Goldman","page_number":15,"box":{"x":265,"y":602,"width":616,"height":11}},{"id":"c8a768ba-966e-42e8-b306-5a49bcb46bbd","block_type":"box","text":"Sachs Asset Management, and his former service as Treasurer and Senior Vice President","page_number":15,"box":{"x":265,"y":617,"width":639,"height":12}},{"id":"e4132aef-28eb-4580-b6e1-e4090ac0d8f7","block_type":"box","text":"of the Goldman Sachs Mutual Funds and as Director of the Goldman Sachs Offshore","page_number":15,"box":{"x":265,"y":632,"width":603,"height":9}},{"id":"13c34bc5-73a9-46b4-beb8-07f64aa38bb6","block_type":"box","text":"Funds provides the Board with the benefit of his experience with the management","page_number":15,"box":{"x":265,"y":647,"width":582,"height":12}},{"id":"a5de62c1-a7f9-406a-8e4e-2b26984a7b00","block_type":"box","text":"practices of other financial companies. Mr. Perlowski also serves as a board member for","page_number":15,"box":{"x":265,"y":663,"width":632,"height":11}},{"id":"5ea3b7a8-c6e3-4c17-a2ec-8a46ea4e9060","block_type":"box","text":"the funds in the BlackRock Fixed-Income Complex. 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Stern","page_number":20,"box":{"x":79,"y":117,"width":97,"height":9}},{"id":"20f65915-478c-44c8-a1a5-aa1eac59ea17","block_type":"box","text":"*","page_number":20,"box":{"x":178,"y":118,"width":4,"height":2}},{"id":"7e945b5d-9a6d-4ccc-86b2-ba29970ff02c","block_type":"box","text":"............................................","page_number":20,"box":{"x":192,"y":125,"width":352,"height":1}},{"id":"fdce9a5e-e5af-427a-8b9f-a6b8048f0df8","block_type":"box","text":"None None","page_number":20,"box":{"x":633,"y":117,"width":217,"height":9}},{"id":"a8dddad9-3596-4792-ac18-6b407f0f536d","block_type":"box","text":"Kenneth L. Urish","page_number":20,"box":{"x":79,"y":132,"width":117,"height":9}},{"id":"4bdd10e0-2ea8-4ac1-bcd9-40880dbf8366","block_type":"box","text":"...........................................","page_number":20,"box":{"x":200,"y":140,"width":344,"height":1}},{"id":"960bb06e-e4d8-4a20-99ed-2c66aa99419b","block_type":"box","text":"None Over $100,000","page_number":20,"box":{"x":633,"y":132,"width":254,"height":11}},{"id":"7413e7d8-3af4-4208-9547-db5306937a0b","block_type":"box","text":"Claire A. Walton . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Over","page_number":20,"box":{"x":79,"y":147,"width":548,"height":9}},{"id":"7328afc9-1d67-4138-945d-35bf07decb0e","block_type":"box","text":"$100,000 Over $100,000","page_number":20,"box":{"x":633,"y":147,"width":254,"height":11}},{"id":"5fce88c3-d2fb-4baf-b02c-d820bd83ed9f","block_type":"box","text":"Interested Trustees","page_number":20,"box":{"x":70,"y":163,"width":138,"height":8}},{"id":"10ed9bdd-ac02-4543-9296-f693b6dc3347","block_type":"box","text":"Rober t Fairbairn","page_number":20,"box":{"x":79,"y":178,"width":113,"height":9}},{"id":"c1794155-4ea4-401a-87ac-25e421832c92","block_type":"box","text":"...........................................","page_number":20,"box":{"x":200,"y":185,"width":344,"height":1}},{"id":"c590ae04-64ee-4366-9ef4-140bbb4cfdde","block_type":"box","text":"None Over $100,000","page_number":20,"box":{"x":633,"y":177,"width":254,"height":11}},{"id":"c5942941-c0f3-42bd-9c8c-73f93ef2f615","block_type":"box","text":"John M. Perlowski. . .","page_number":20,"box":{"x":78,"y":193,"width":149,"height":9}},{"id":"db9d1708-e316-4cba-b721-fec9a5a7ffdf","block_type":"box","text":".......................................","page_number":20,"box":{"x":233,"y":200,"width":311,"height":2}},{"id":"ad593ed0-97fe-464e-b627-03108bb57141","block_type":"box","text":"None Over $100,000","page_number":20,"box":{"x":633,"y":192,"width":254,"height":11}},{"id":"b8aaab5d-3702-46e4-aaeb-b523decf3444","block_type":"box","text":"* Information is provided as of April 1, 2026, the date Mr. Jarczyk and Mr. Stern first served as consultants to the Independent Trustees.","page_number":20,"box":{"x":70,"y":217,"width":795,"height":9}},{"id":"eca2e514-0d0f-4efa-8a39-7fc6f3865338","block_type":"box","text":"As of September 3, 2026, the Trustees and officers of the Trust as a group directly or indirectly beneficially","page_number":20,"box":{"x":101,"y":238,"width":767,"height":11}},{"id":"b7174eb9-5154-4266-80e3-46bdce81e3fd","block_type":"box","text":"owned an aggregate of less than 1% of any class of the outstanding shares of the Fund. As of December 31, 2025","page_number":20,"box":{"x":69,"y":253,"width":819,"height":11}},{"id":"4616cec3-0ca3-4e0c-a539-0a721f61ef38","block_type":"box","text":"(and, with respect to Mr. Jarczyk and Mr. Stern, as of April 1, 2026), none of the Independent Trustees of the Trust or","page_number":20,"box":{"x":69,"y":268,"width":839,"height":11}},{"id":"c303678c-3b06-4748-b0a6-1b59e8c32988","block_type":"box","text":"their immediate family members owned beneficially or of record any securities of the Fund’s investment adviser,","page_number":20,"box":{"x":68,"y":283,"width":798,"height":12}},{"id":"6108679d-464c-4799-bb81-4195ea25efbc","block_type":"box","text":"principal underwriter, or any person directly or indirectly controlling, controlled by, or under common control with such","page_number":20,"box":{"x":70,"y":299,"width":831,"height":11}},{"id":"a5fedb12-2265-4afc-b580-0a4c41b8223a","block_type":"box","text":"entities.","page_number":20,"box":{"x":69,"y":314,"width":56,"height":9}},{"id":"c25cc05c-0286-4594-ba31-76a9bac201a1","block_type":"box","text":"Compensation of Trustees","page_number":20,"box":{"x":69,"y":344,"width":190,"height":11}},{"id":"5f762f02-0e69-4c8e-9dcc-b98109a65133","block_type":"box","text":"Each Trustee who is an Independent Trustee is paid as compensation an annual retainer of $375,000 per year","page_number":20,"box":{"x":102,"y":366,"width":791,"height":12}},{"id":"4bff3c52-bc0e-4692-a15e-4fb3d6a42e6d","block_type":"box","text":"for his or her services as a board member of the BlackRock-advised Funds in the BlackRock Multi-Asset Complex,","page_number":20,"box":{"x":68,"y":382,"width":810,"height":11}},{"id":"bc50a618-9cf6-4196-9330-012b7a75dd2d","block_type":"box","text":"including the Trust, and a $20,000 board meeting fee to be paid for each in-person board meeting attended (and may","page_number":20,"box":{"x":70,"y":396,"width":838,"height":12}},{"id":"d6287757-6532-4e7a-94f4-3fc50b6ccd71","block_type":"box","text":"receive a board meeting fee for telephonic attendance at board meetings), for up to five board meetings held in a","page_number":20,"box":{"x":69,"y":412,"width":807,"height":11}},{"id":"2b871640-68af-4734-a98f-db1610c087d6","block_type":"box","text":"calendar year (compensation for meetings in excess of this number to be determined on a case-by-case basis),","page_number":20,"box":{"x":69,"y":427,"width":791,"height":11}},{"id":"5b0522e5-3a12-4274-8313-a06f3fcd5920","block_type":"box","text":"together with out-of-pocket expenses in accordance with a board policy on travel and other business expenses","page_number":20,"box":{"x":68,"y":442,"width":786,"height":11}},{"id":"1b07ddac-ff9e-4e00-aa56-afb7d5c7fd79","block_type":"box","text":"relating to attendance at meetings. The Chairs of the Audit Committee, Compliance Committee, Governance","page_number":20,"box":{"x":69,"y":457,"width":769,"height":12}},{"id":"ddfd570e-b955-4ae8-8d01-62079c26e1bb","block_type":"box","text":"Committee and Per formance Oversight Committee are paid as compensation an additional annual retainer of","page_number":20,"box":{"x":69,"y":472,"width":778,"height":12}},{"id":"37d49b43-f5f1-4653-b4aa-d05ebcad2313","block_type":"box","text":"$45,000, respectively. The Chair of the Board is paid an additional annual retainer of $150,000.","page_number":20,"box":{"x":69,"y":487,"width":689,"height":12}},{"id":"a12e461a-3666-474e-9611-0eca6be93b39","block_type":"box","text":"The following table sets for th the compensation the Trust paid to the Trustees on behalf of the Fund for the","page_number":20,"box":{"x":101,"y":510,"width":766,"height":11}},{"id":"175f94eb-361a-48ce-bc42-c33543107913","block_type":"box","text":"fiscal year ending May 31, 2026 and the aggregate compensation paid to them by all BlackRock-advised Funds for","page_number":20,"box":{"x":68,"y":525,"width":817,"height":12}},{"id":"8399185e-8745-4046-8304-fa1d0b8389a5","block_type":"box","text":"the calendar year ended December 31, 2025.","page_number":20,"box":{"x":68,"y":540,"width":326,"height":12}},{"id":"fece91a9-3dfb-4067-a4ce-75054d9f8f12","block_type":"box","text":"Name","page_number":20,"box":{"x":69,"y":609,"width":32,"height":7}},{"id":"9b1b606e-bb88-464a-b686-d1df88731040","block_type":"box","text":"Compensation","page_number":20,"box":{"x":551,"y":599,"width":83,"height":9}},{"id":"d52ddc9f-75a3-4a71-84df-a7f586884435","block_type":"box","text":"from the Fund","page_number":20,"box":{"x":552,"y":609,"width":81,"height":7}},{"id":"2b1c964f-4646-443c-b89f-b7d8b3692e22","block_type":"box","text":"Estimated Annual","page_number":20,"box":{"x":664,"y":589,"width":102,"height":7}},{"id":"ebd1fbd9-2096-4212-999f-8c5bd4c0f6ac","block_type":"box","text":"Benefits upon","page_number":20,"box":{"x":676,"y":599,"width":79,"height":9}},{"id":"412c392e-b146-4e52-aa3a-77776903acc7","block_type":"box","text":"Retirement","page_number":20,"box":{"x":683,"y":609,"width":64,"height":7}},{"id":"a137bf74-d655-434b-b89a-5a6ffc5f1159","block_type":"box","text":"Aggregate","page_number":20,"box":{"x":822,"y":569,"width":61,"height":9}},{"id":"f7f4a720-5be1-46fc-8a1a-be95ae24a344","block_type":"box","text":"Compensation from","page_number":20,"box":{"x":796,"y":579,"width":113,"height":9}},{"id":"191ac72a-e27b-4cb4-ad39-446de2dcf7cd","block_type":"box","text":"the Fund and","page_number":20,"box":{"x":815,"y":589,"width":75,"height":7}},{"id":"a8057630-8971-47dd-bb90-72e205f0d651","block_type":"box","text":"Other BlackRock","page_number":20,"box":{"x":802,"y":599,"width":102,"height":7}},{"id":"a4aeb7f2-f53e-47ec-b152-b8f2d81f8164","block_type":"box","text":"Advised Funds","page_number":20,"box":{"x":809,"y":609,"width":84,"height":7}},{"id":"d041970d-00d9-4f8a-8f87-3f87c3e6e302","block_type":"box","text":"1","page_number":20,"box":{"x":893,"y":609,"width":4,"height":4}},{"id":"e5c8b03c-8959-4a93-b0ad-20129137516b","block_type":"box","text":"Independent Trustees","page_number":20,"box":{"x":70,"y":627,"width":154,"height":11}},{"id":"c56c2839-8999-4c0f-9bc5-999d2f198d64","block_type":"box","text":"Christopher J. 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Cotty. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $4,408 None","page_number":20,"box":{"x":79,"y":686,"width":654,"height":12}},{"id":"51dc5a81-8fb5-47d1-860e-7c2687ae30fc","block_type":"box","text":"$467,500","page_number":20,"box":{"x":817,"y":686,"width":72,"height":12}},{"id":"c63e3cf2-4dd1-4c6f-b1c1-c3fb11f0fdd2","block_type":"box","text":"Jeffrey Jarczyk","page_number":20,"box":{"x":78,"y":702,"width":103,"height":11}},{"id":"06c3015c-5c75-4d58-8099-db20410ba79f","block_type":"box","text":"2","page_number":20,"box":{"x":181,"y":703,"width":4,"height":4}},{"id":"e6ce9dc6-7412-46e0-9a8a-0a53e12a2259","block_type":"box","text":".........................................","page_number":20,"box":{"x":192,"y":710,"width":328,"height":1}},{"id":"8c7de8ef-9d62-4838-8a8a-587005e067be","block_type":"box","text":"$813 None None","page_number":20,"box":{"x":574,"y":702,"width":297,"height":10}},{"id":"dfab0c07-4405-450a-8cfe-cc9db6af7168","block_type":"box","text":"Henry R. Keizer","page_number":20,"box":{"x":79,"y":718,"width":109,"height":11}},{"id":"801c9db2-9438-471c-85cc-6cf15d83cbbd","block_type":"box","text":"3","page_number":20,"box":{"x":189,"y":718,"width":4,"height":4}},{"id":"c80aa241-564b-45d8-93ba-a0d3a9f2d99a","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $4,810 None","page_number":20,"box":{"x":200,"y":717,"width":533,"height":11}},{"id":"8bbfa35f-e54a-4bb6-9824-d498cc65c176","block_type":"box","text":"$490,000","page_number":20,"box":{"x":817,"y":717,"width":72,"height":11}},{"id":"8c2d63af-dcbb-4b77-b6aa-69ccfc5b283c","block_type":"box","text":"Cynthia A. Montgomery","page_number":20,"box":{"x":79,"y":733,"width":164,"height":11}},{"id":"72e109d2-db8c-412f-87ba-c596f3c0400a","block_type":"box","text":"4","page_number":20,"box":{"x":244,"y":733,"width":4,"height":4}},{"id":"e6e2dfe4-3a54-4567-9853-b42385191264","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $4,628 None $490,000","page_number":20,"box":{"x":257,"y":732,"width":632,"height":11}},{"id":"1846c9bc-dbfb-452f-bbb8-1d09764bfc88","block_type":"box","text":"Donald C. 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Management, Advisory and Other Service Arrangements","page_number":21,"box":{"x":69,"y":137,"width":432,"height":11}},{"id":"99f40a33-e4bb-424f-a3c2-287d2d357b19","block_type":"box","text":"Management Agreement","page_number":21,"box":{"x":69,"y":167,"width":180,"height":11}},{"id":"7935217c-14d6-4217-bd5b-bc3cabcffde4","block_type":"box","text":"The Trust, on behalf of the Fund, has entered into an investment advisory agreement with BlackRock (the","page_number":21,"box":{"x":101,"y":189,"width":751,"height":12}},{"id":"975e879f-ab41-4acd-9178-7cb1d332c8e0","block_type":"box","text":"“Management Agreement”) pursuant to which BlackRock is entitled to receive fees for the services it provides.","page_number":21,"box":{"x":70,"y":205,"width":788,"height":11}},{"id":"cd4383ad-783b-4830-b98b-617fc19e7272","block_type":"box","text":"BlackRock has contractually agreed to waive the management fee with respect to any por tion of the Fund’s","page_number":21,"box":{"x":102,"y":227,"width":762,"height":12}},{"id":"182043e7-4104-4d5b-a739-1b851ecaf20c","block_type":"box","text":"assets estimated to be attributable to investments in other equity and fixed-income mutual funds and exchange","page_number":21,"box":{"x":69,"y":242,"width":799,"height":12}},{"id":"28b13b2b-75ff-484c-b5f2-dca19485d9b9","block_type":"box","text":"traded funds managed by BlackRock or its affiliates that have a contractual management fee, through","page_number":21,"box":{"x":68,"y":258,"width":726,"height":11}},{"id":"ba8799ea-e1b0-46f6-9f70-cca031b99443","block_type":"box","text":"June 30, 2028. 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The contractual agreements may be terminated upon 90 days’","page_number":21,"box":{"x":70,"y":303,"width":810,"height":11}},{"id":"1b09ec39-fafd-48dc-a0de-3c68ac6a054b","block_type":"box","text":"notice by a majority of the Independent Trustees or by a vote of a majority of the outstanding voting securities of the","page_number":21,"box":{"x":69,"y":318,"width":827,"height":11}},{"id":"0b242330-f104-45af-9a6e-87d3497ffddd","block_type":"box","text":"Fund.","page_number":21,"box":{"x":70,"y":333,"width":36,"height":9}},{"id":"5154089a-9b35-4291-9761-b5f1524a49b7","block_type":"box","text":"BlackRock has contractually agreed to waive and/or reimburse fees or expenses in order to limit Total Annual","page_number":21,"box":{"x":102,"y":356,"width":778,"height":11}},{"id":"b35fa1b8-44fd-48f0-90ab-3219c4b42963","block_type":"box","text":"Fund Operating Expenses After Fee Waivers and/or Expense Reimbursements (excluding Interest Expense, Dividend","page_number":21,"box":{"x":70,"y":371,"width":823,"height":11}},{"id":"6bc537ff-3a27-4af5-a064-afc1a6e87ec5","block_type":"box","text":"Expense, Acquired Fund Fees and Expenses and cer tain other Fund expenses (as defined in the Fund’s","page_number":21,"box":{"x":70,"y":386,"width":734,"height":11}},{"id":"638a21b9-db5f-4e09-8895-728c2e1ec17f","block_type":"box","text":"Prospectuses) as a percentage of average daily net assets to 1.14% for Investor A Shares, 1.89% for Investor C","page_number":21,"box":{"x":69,"y":401,"width":798,"height":11}},{"id":"b90c441f-dbf3-489b-9762-35dcb9bb1a99","block_type":"box","text":"Shares, 0.89% for Institutional Shares, 1.39% for Class R Shares, 1.14% for Service Shares, and 0.84% for Class K","page_number":21,"box":{"x":69,"y":416,"width":831,"height":11}},{"id":"e4f58ea4-b3c4-414a-a646-8811c2cc8aee","block_type":"box","text":"Shares through June 30, 2028. The contractual agreements may be terminated upon 90 days’ notice by a majority of","page_number":21,"box":{"x":69,"y":431,"width":837,"height":12}},{"id":"f2ad21e6-9f12-4a41-8781-a17f77bc909f","block_type":"box","text":"the Independent Trustees or by a vote of a majority of the outstanding voting securities of the Fund.","page_number":21,"box":{"x":68,"y":446,"width":710,"height":12}},{"id":"36ec0d45-0802-4774-b51c-8c4e9eeb84a6","block_type":"box","text":"Pursuant to the Management Agreement, BlackRock may from time to time, in its sole discretion to the extent","page_number":21,"box":{"x":102,"y":469,"width":784,"height":11}},{"id":"c67706de-5989-46aa-95dc-9572689ee073","block_type":"box","text":"permitted by applicable law, appoint one or more sub-advisers, including, without limitation, affiliates of BlackRock, to","page_number":21,"box":{"x":70,"y":484,"width":838,"height":12}},{"id":"a80474b1-7fba-43b1-83a7-6fc4e62cd658","block_type":"box","text":"per form investment advisory services with respect to the Fund. 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BlackRock may terminate any or all sub-advisers or such delegation arrangements in its","page_number":21,"box":{"x":70,"y":530,"width":827,"height":11}},{"id":"d9331143-ed88-4f9c-9b81-a377b69d2c02","block_type":"box","text":"sole discretion at any time to the extent permitted by applicable law.","page_number":21,"box":{"x":69,"y":545,"width":486,"height":11}},{"id":"197e953e-659e-41f4-a85d-2520d88ebe8c","block_type":"box","text":"The table below sets for th information about the total management fees paid by the Trust to BlackRock, on","page_number":21,"box":{"x":101,"y":567,"width":765,"height":12}},{"id":"d44dac4d-6ade-4098-9196-cd3d44058ef9","block_type":"box","text":"behalf of the Fund, and the amounts waived and reimbursed by BlackRock for the periods shown.","page_number":21,"box":{"x":69,"y":583,"width":692,"height":11}},{"id":"70bef3ad-7608-409a-a7bf-5932754cfddb","block_type":"box","text":"Fees","page_number":21,"box":{"x":637,"y":611,"width":27,"height":7}},{"id":"302090ed-cacd-409d-abe3-49556b69400e","block_type":"box","text":"Paid to","page_number":21,"box":{"x":630,"y":621,"width":41,"height":7}},{"id":"27834a55-631e-4d0e-a777-15204f9f11b3","block_type":"box","text":"BlackRock","page_number":21,"box":{"x":619,"y":631,"width":63,"height":7}},{"id":"9465905b-4ebf-4ebb-a57a-6511888736cd","block_type":"box","text":"Fees","page_number":21,"box":{"x":747,"y":611,"width":27,"height":7}},{"id":"e11e2794-4f45-4a30-aa50-ad77566ff15f","block_type":"box","text":"Waived by","page_number":21,"box":{"x":731,"y":621,"width":59,"height":9}},{"id":"e47ff1dc-8482-4c21-b1fd-d7510d9099f5","block_type":"box","text":"BlackRock","page_number":21,"box":{"x":730,"y":631,"width":62,"height":7}},{"id":"a935527d-aa15-4558-8a3d-7abbd5df541f","block_type":"box","text":"Fees","page_number":21,"box":{"x":852,"y":611,"width":27,"height":7}},{"id":"74c15757-7d68-4da9-a6ea-5b28bcc9ed8f","block_type":"box","text":"Reimbursed by","page_number":21,"box":{"x":823,"y":621,"width":85,"height":9}},{"id":"ff9b14b8-2cba-4c7c-aa18-fd9f6cd217f9","block_type":"box","text":"BlackRock","page_number":21,"box":{"x":835,"y":631,"width":62,"height":7}},{"id":"c97e9835-fbda-4050-97b8-dc4ea5a588e8","block_type":"box","text":"Fiscal Year Ended May 31, 2026 . . . .","page_number":21,"box":{"x":70,"y":649,"width":264,"height":11}},{"id":"7be3aa04-2011-4c35-be00-e967f7bff637","block_type":"box","text":".............................","page_number":21,"box":{"x":341,"y":656,"width":230,"height":2}},{"id":"678faca2-8cb0-4247-89de-6502e9d1842a","block_type":"box","text":"$51,387,897 $19,246 $ 80,785","page_number":21,"box":{"x":602,"y":648,"width":307,"height":11}},{"id":"47fd3994-aa61-416c-b47b-ad062baaffa6","block_type":"box","text":"Fiscal Year Ended May 31, 2025 . . . .","page_number":21,"box":{"x":70,"y":664,"width":264,"height":11}},{"id":"22e4a613-dcaa-4b78-8627-ddb14c65a4f6","block_type":"box","text":".............................","page_number":21,"box":{"x":341,"y":671,"width":230,"height":2}},{"id":"dad9cc47-a9e7-4e24-86bb-a238d9a4b63b","block_type":"box","text":"$44,202,451 $36,173 $ 123,137","page_number":21,"box":{"x":602,"y":663,"width":306,"height":11}},{"id":"a84568f7-0408-4d59-9cab-0852ccbe454c","block_type":"box","text":"Fiscal Year Ended May 31, 2024 . . . .","page_number":21,"box":{"x":70,"y":679,"width":264,"height":11}},{"id":"b43f3c76-b4d8-48d2-bcbf-9f5af4958f60","block_type":"box","text":".............................","page_number":21,"box":{"x":341,"y":686,"width":230,"height":2}},{"id":"93724a60-5bc8-47dc-9794-8d97157d6a0d","block_type":"box","text":"$36,858,993 $ 9,040 $1,007,943","page_number":21,"box":{"x":602,"y":678,"width":307,"height":11}},{"id":"53c3eba6-5865-4eb8-b4c0-5f9984146159","block_type":"box","text":"Administration Agreement","page_number":21,"box":{"x":68,"y":711,"width":191,"height":11}},{"id":"1b9b1058-8822-4edc-b2b6-83623244ce88","block_type":"box","text":"BlackRock serves as the Fund’s administrator (in such capacity, the “Administrator”) pursuant to an","page_number":21,"box":{"x":102,"y":733,"width":711,"height":11}},{"id":"df0dfa79-2da4-46f8-a28e-8fe9511aa0f9","block_type":"box","text":"administration agreement (the “Administration Agreement”). The Administrator has agreed to maintain office facilities","page_number":21,"box":{"x":69,"y":748,"width":838,"height":12}},{"id":"d7146ad9-de48-4fe3-81cc-f3946feadc3a","block_type":"box","text":"for the Fund; furnish the Fund with clerical, bookkeeping and administrative services; oversee the determination and","page_number":21,"box":{"x":68,"y":763,"width":830,"height":12}},{"id":"1f40fab5-c8d6-4d12-8149-bc2c2b13b9ed","block_type":"box","text":"publication of the Fund’s net asset value; oversee the preparation and filing of Federal, state and local income tax","page_number":21,"box":{"x":70,"y":778,"width":813,"height":12}},{"id":"44e6db6f-40dc-4283-aca6-d21de58f6a57","block_type":"box","text":"returns; prepare cer tain repor ts required by regulatory authorities; calculate various contractual expenses; determine","page_number":21,"box":{"x":69,"y":794,"width":837,"height":11}},{"id":"3100b90f-9d2e-4423-b296-404b7cffa7ee","block_type":"box","text":"the amount of dividends and distributions available for payment by the Fund to its shareholders; prepare and arrange","page_number":21,"box":{"x":68,"y":809,"width":836,"height":11}},{"id":"c5e200b6-3ced-415e-9f23-f7b6d80c7627","block_type":"box","text":"for the printing of dividend notices to shareholders; provide Fund service providers with such information as is","page_number":21,"box":{"x":68,"y":824,"width":785,"height":11}},{"id":"03eadbf2-2e8b-4ae6-aac4-226bb960d8b3","block_type":"box","text":"required to effect the payment of dividends and distributions; and serve as liaison with the Trust’s officers,","page_number":21,"box":{"x":69,"y":839,"width":765,"height":11}},{"id":"9f0ba84e-1df5-4bdc-b885-7e84e48ce5fb","block_type":"box","text":"independent accountants, legal counsel, custodian, accounting agent and transfer and dividend disbursing agent in","page_number":21,"box":{"x":70,"y":854,"width":819,"height":11}},{"id":"f383a34f-828d-4d47-995b-26bdbc4884a3","block_type":"box","text":"establishing the accounting policies of the Fund and monitoring financial and shareholder accounting services. The","page_number":21,"box":{"x":69,"y":869,"width":818,"height":11}},{"id":"4d9c7456-bf3b-4fd8-b392-8e9e6c3dfe2a","block_type":"box","text":"Administrator may from time to time voluntarily waive administration fees with respect to the Fund and may voluntarily","page_number":21,"box":{"x":68,"y":884,"width":840,"height":11}},{"id":"5ff3183c-d107-4cf3-8367-651814dc691c","block_type":"box","text":"reimburse the Fund for expenses.","page_number":21,"box":{"x":69,"y":899,"width":238,"height":11}},{"id":"a5a37895-aa0b-4127-b3aa-3abe9ccec059","block_type":"box","text":"I-19","page_number":21,"box":{"x":476,"y":943,"width":26,"height":9}},{"id":"11b0378c-1a15-4c3f-9a55-9a1d9201a9a5","block_type":"box","text":"NM1026U-5982568-21/232","page_number":21,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"43a31ce7-7e67-4d6f-938a-841dafc2fafc","block_type":"box","text":"Under the Administration Agreement, the Trust, on behalf of the Fund, pays to the Administrator a fee, computed","page_number":22,"box":{"x":102,"y":45,"width":802,"height":11}},{"id":"f2094ea0-961f-4a23-a9ed-b922a1cd13a1","block_type":"box","text":"daily and payable monthly, at an aggregate annual rate of (i) 0.0425% of the first $500 million of the Fund’s average","page_number":22,"box":{"x":69,"y":59,"width":830,"height":12}},{"id":"120d1953-4508-4791-ad0c-79dab0b0eeb8","block_type":"box","text":"daily net assets, 0.040% of the next $500 million of the Fund’s average daily net assets, 0.0375% of the next","page_number":22,"box":{"x":69,"y":74,"width":788,"height":12}},{"id":"72b7dc64-3916-41ae-891c-cad99acb053f","block_type":"box","text":"$1 billion of the Fund’s average daily net assets, 0.035% of the next $2 billion of the Fund’s average daily net","page_number":22,"box":{"x":69,"y":89,"width":785,"height":12}},{"id":"8e7aca81-f2cb-417e-a229-7c1f2dae19b3","block_type":"box","text":"assets, 0.0325% of the next $9 billion of the Fund’s average daily net assets and 0.030% of the average daily net","page_number":22,"box":{"x":69,"y":104,"width":816,"height":12}},{"id":"8a0e0618-3605-4a66-b836-a0ba154dedf8","block_type":"box","text":"assets of the Fund in excess of $13 billion and (ii) 0.020% of average daily net assets allocated to each class of","page_number":22,"box":{"x":69,"y":120,"width":805,"height":12}},{"id":"9453011f-3d9b-4cc6-9b28-0632d66868b6","block_type":"box","text":"shares of the Fund.","page_number":22,"box":{"x":69,"y":135,"width":137,"height":9}},{"id":"2e1f78ef-1aa6-4bc8-bada-3dcaca815538","block_type":"box","text":"The table below sets for th information about the administration fees paid by the Trust on behalf of the Fund, to","page_number":22,"box":{"x":101,"y":158,"width":793,"height":11}},{"id":"fc28d57f-1c95-4eb9-b0ca-448ce1521efc","block_type":"box","text":"the Administrator, and the amounts waived, for the periods shown.","page_number":22,"box":{"x":68,"y":173,"width":474,"height":11}},{"id":"ebf10b5e-4427-4b88-8e2d-1c05efc13343","block_type":"box","text":"Fees Paid","page_number":22,"box":{"x":729,"y":201,"width":56,"height":8}},{"id":"dc674b66-d865-46fb-9dab-6821dc6547d3","block_type":"box","text":"to the","page_number":22,"box":{"x":740,"y":212,"width":34,"height":7}},{"id":"f687de5a-f102-4d85-8613-9b10c922af30","block_type":"box","text":"Administrator","page_number":22,"box":{"x":717,"y":222,"width":79,"height":7}},{"id":"8007de39-3d1c-4893-b3cd-f568c14280c8","block_type":"box","text":"Fees Waived","page_number":22,"box":{"x":834,"y":201,"width":72,"height":8}},{"id":"f8327006-80c4-4d23-920a-40d3b34a29af","block_type":"box","text":"by the","page_number":22,"box":{"x":853,"y":212,"width":35,"height":8}},{"id":"426ceff8-7a46-4e0c-96fb-e5a52c079172","block_type":"box","text":"Administrator","page_number":22,"box":{"x":830,"y":222,"width":79,"height":7}},{"id":"5599ff8f-a1f6-4d7d-967c-d9c19cbf0742","block_type":"box","text":"Fiscal Year Ended May 31, 2026 . . .","page_number":22,"box":{"x":70,"y":239,"width":253,"height":11}},{"id":"ccc79582-7299-4e3a-8f27-8e9a8f04b782","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $3,","page_number":22,"box":{"x":330,"y":239,"width":406,"height":11}},{"id":"9d77ab28-db2e-44e5-a934-93de15e7d883","block_type":"box","text":"773,431 $886,984","page_number":22,"box":{"x":738,"y":239,"width":168,"height":11}},{"id":"058ecd00-beac-4fce-9c20-b99a5575f843","block_type":"box","text":"Fiscal Year Ended May 31, 2025 . . .","page_number":22,"box":{"x":70,"y":255,"width":253,"height":11}},{"id":"8f58bf52-30d0-4362-bd3f-069d901106c7","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $3,","page_number":22,"box":{"x":330,"y":254,"width":406,"height":11}},{"id":"ace140f5-bf4a-415d-bf96-61d22727e537","block_type":"box","text":"241,940 $646,033","page_number":22,"box":{"x":738,"y":254,"width":168,"height":11}},{"id":"48731698-b31b-4294-bb8f-86717b83dfe9","block_type":"box","text":"Fiscal Year Ended May 31, 2024 . . .","page_number":22,"box":{"x":70,"y":270,"width":253,"height":11}},{"id":"a2b2dc20-6d3f-431b-9edc-2269f19e75d4","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $2,","page_number":22,"box":{"x":330,"y":269,"width":406,"height":11}},{"id":"2c8b603f-7fcf-49b3-b772-95765d9f5584","block_type":"box","text":"705,640 $918,064","page_number":22,"box":{"x":738,"y":269,"width":168,"height":11}},{"id":"c5227948-42f0-4810-a58b-8c67443ed1ca","block_type":"box","text":"The Trust and its service providers may engage third par ty plan administrators who provide trustee,","page_number":22,"box":{"x":101,"y":294,"width":708,"height":11}},{"id":"a330a5af-6148-48d2-bbda-5d55eab02b22","block_type":"box","text":"administrative and recordkeeping services for cer tain employee benefit, profit-sharing and retirement plans as agents","page_number":22,"box":{"x":69,"y":309,"width":838,"height":11}},{"id":"a4d0665f-cd80-4766-a681-1e3ec8837507","block_type":"box","text":"for the Trust with respect to such plans, for the purpose of accepting orders for the purchase and redemption of","page_number":22,"box":{"x":68,"y":324,"width":800,"height":11}},{"id":"a0219e6f-9ddb-45f0-8c7f-ec96f9f63673","block_type":"box","text":"shares of the Trust.","page_number":22,"box":{"x":69,"y":339,"width":138,"height":9}},{"id":"3200e435-3b03-44e9-9a4c-1b7f49ca6be2","block_type":"box","text":"In addition, pursuant to a Shareholders’ Administrative Services Agreement, BlackRock provides cer tain","page_number":22,"box":{"x":102,"y":362,"width":740,"height":11}},{"id":"ed380b64-29f2-432c-892e-3515e8a8a863","block_type":"box","text":"shareholder liaison services in connection with the Trust’s investor service center. The Trust, on behalf of the Fund,","page_number":22,"box":{"x":69,"y":377,"width":824,"height":10}},{"id":"212a2c5f-d27e-4012-bd9f-cd98adad84e4","block_type":"box","text":"reimburses BlackRock for its costs in maintaining the service center, which costs include, among other things,","page_number":22,"box":{"x":69,"y":392,"width":787,"height":11}},{"id":"9b353681-01ea-4d10-a6dc-80641ac579f4","block_type":"box","text":"employee salaries, leasehold expenses, and other out-of-pocket expenses.","page_number":22,"box":{"x":69,"y":407,"width":531,"height":11}},{"id":"d8870fd6-2f50-4213-9e29-3f2cd0c50ee9","block_type":"box","text":"For the periods shown, the Trust on behalf of the Fund reimbursed BlackRock for shareholder liaison services","page_number":22,"box":{"x":102,"y":429,"width":780,"height":11}},{"id":"f4dea62e-2771-4843-8583-1a6096629a6a","block_type":"box","text":"pursuant to such agreement in the amounts set for th below.","page_number":22,"box":{"x":70,"y":445,"width":427,"height":11}},{"id":"1a95b2cc-8088-4a2c-ab70-e5c708b6a630","block_type":"box","text":"Fees Paid","page_number":22,"box":{"x":655,"y":473,"width":55,"height":7}},{"id":"75418f2c-a223-442f-ad00-20b3c1ec0415","block_type":"box","text":"to BlackRock Fees Waived by BlackRock","page_number":22,"box":{"x":643,"y":483,"width":267,"height":9}},{"id":"7dc35b72-a9f7-4cbe-9df9-30720a4b3dc4","block_type":"box","text":"Fiscal Year Ended May 31, 2026 . . . . . . .","page_number":22,"box":{"x":70,"y":501,"width":289,"height":11}},{"id":"dcf20ccb-1e37-4bc1-b50c-ea5493e90197","block_type":"box","text":"...............................","page_number":22,"box":{"x":366,"y":508,"width":246,"height":2}},{"id":"1b036d96-8a37-41ca-a560-90dfa3ef304f","block_type":"box","text":"$110,200 $26,546","page_number":22,"box":{"x":647,"y":500,"width":215,"height":11}},{"id":"5d7f2b53-dbce-419d-8ed3-0f025a50e00f","block_type":"box","text":"Fiscal Year Ended May 31, 2025 . . . . . . .","page_number":22,"box":{"x":70,"y":516,"width":289,"height":11}},{"id":"e729edeb-4af1-4112-8e5f-2b579ef50a47","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 68,181","page_number":22,"box":{"x":366,"y":515,"width":352,"height":11}},{"id":"a125d397-9977-43d1-aa0c-3b2646b0ecea","block_type":"box","text":"$25,155","page_number":22,"box":{"x":800,"y":515,"width":62,"height":11}},{"id":"f53e62a8-07e3-4599-b70a-c6fa8bfc4c74","block_type":"box","text":"Fiscal Year Ended May 31, 2024 . . . . . . .","page_number":22,"box":{"x":70,"y":531,"width":289,"height":11}},{"id":"04354e11-a87d-45d6-812d-affbc71d8d62","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 87,543","page_number":22,"box":{"x":366,"y":530,"width":353,"height":11}},{"id":"ed3dc8e6-72b2-4673-91e6-a1ffdec4f5f7","block_type":"box","text":"$86,543","page_number":22,"box":{"x":800,"y":530,"width":62,"height":11}},{"id":"b1e011db-1df8-474d-bf25-8dc00a7a0c33","block_type":"box","text":"Information Regarding the Portfolio Managers","page_number":22,"box":{"x":69,"y":562,"width":335,"height":12}},{"id":"e9928844-bd66-4809-9343-76681d0ecdf7","block_type":"box","text":"Tony Kim and Reid Menge are the por tfolio managers and are jointly and primarily responsible for the day-to-day","page_number":22,"box":{"x":101,"y":585,"width":796,"height":11}},{"id":"8c975040-c4b7-4720-a97f-fdba871f6a91","block_type":"box","text":"management of the Fund.","page_number":22,"box":{"x":69,"y":600,"width":181,"height":12}},{"id":"40f4016e-0338-4d36-86b5-5ad0f8f3e6d8","block_type":"box","text":"Other Funds and Accounts Managed","page_number":22,"box":{"x":70,"y":631,"width":265,"height":11}},{"id":"160439db-9af6-49b1-8464-8bc3280a8ac1","block_type":"box","text":"The following table sets for th information about the funds and accounts other than the Fund for which the","page_number":22,"box":{"x":101,"y":653,"width":753,"height":11}},{"id":"2a361a32-219a-4ec8-a1c8-f71efac9b056","block_type":"box","text":"por tfolio managers are primarily responsible for the day-to-day por tfolio management as of the Fund’s fiscal year","page_number":22,"box":{"x":70,"y":668,"width":801,"height":12}},{"id":"d8818613-b7a1-403c-97a8-189024ec0c48","block_type":"box","text":"ended May 31, 2026.","page_number":22,"box":{"x":69,"y":683,"width":154,"height":12}},{"id":"7dc34081-cbdb-41e1-9c31-44b178767107","block_type":"box","text":"Number of Other Accounts Managed","page_number":22,"box":{"x":362,"y":712,"width":211,"height":9}},{"id":"564c3dfa-83a7-441c-8d73-7323dbcd626d","block_type":"box","text":"and Assets by Account Type","page_number":22,"box":{"x":385,"y":722,"width":165,"height":9}},{"id":"24763404-b399-4105-8de4-25b3566e67ee","block_type":"box","text":"Number of Other Accounts and Assets","page_number":22,"box":{"x":656,"y":712,"width":222,"height":7}},{"id":"7a92f4ea-66f1-4dff-bcfa-f881d0a1b9cf","block_type":"box","text":"for Which Advisory Fee is Performance-Based","page_number":22,"box":{"x":634,"y":722,"width":265,"height":9}},{"id":"d9d698f1-2c60-4131-a930-0d602094412d","block_type":"box","text":"Name of Portfolio 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Pooled","page_number":22,"box":{"x":425,"y":744,"width":74,"height":8}},{"id":"b325c61c-de9e-4f81-9fa5-da07a6bfe99e","block_type":"box","text":"Investment","page_number":22,"box":{"x":430,"y":755,"width":64,"height":7}},{"id":"ed31b7d0-7800-45d0-b6b2-cd01240f4797","block_type":"box","text":"Vehicles","page_number":22,"box":{"x":438,"y":765,"width":48,"height":7}},{"id":"7b4ace4c-48a8-4dab-8a68-c07f284abd08","block_type":"box","text":"Other","page_number":22,"box":{"x":553,"y":755,"width":31,"height":7}},{"id":"e31db104-9b5c-4eb3-90fb-0eb440a0c54a","block_type":"box","text":"Accounts","page_number":22,"box":{"x":541,"y":765,"width":54,"height":7}},{"id":"d24a4e93-1c96-4db6-b7ca-734f29ce261a","block_type":"box","text":"Other","page_number":22,"box":{"x":656,"y":734,"width":32,"height":7}},{"id":"774ac78f-cf4f-47d6-8abc-e34c8d48d289","block_type":"box","text":"Registered","page_number":22,"box":{"x":641,"y":744,"width":62,"height":9}},{"id":"10919e7b-ae62-4564-8334-c146a815aa2b","block_type":"box","text":"Investment","page_number":22,"box":{"x":640,"y":755,"width":64,"height":7}},{"id":"27dd167d-6459-4577-9d2f-b0d3f5739d6b","block_type":"box","text":"Companies","page_number":22,"box":{"x":640,"y":765,"width":64,"height":8}},{"id":"ed3c17bf-d5a9-4246-8e68-29f3cb062b6e","block_type":"box","text":"Other Pooled","page_number":22,"box":{"x":735,"y":744,"width":74,"height":8}},{"id":"fa04c93b-ef22-4871-91af-5d07c4af7e1f","block_type":"box","text":"Investment","page_number":22,"box":{"x":740,"y":755,"width":64,"height":7}},{"id":"8dded3b5-7e1b-44f6-afa1-e02d9f5ed842","block_type":"box","text":"Vehicles","page_number":22,"box":{"x":748,"y":765,"width":48,"height":7}},{"id":"f203c1ef-d824-4397-a96b-653b50af338b","block_type":"box","text":"Other","page_number":22,"box":{"x":852,"y":755,"width":31,"height":7}},{"id":"0592924a-05d5-4639-a1f5-70964f7a1445","block_type":"box","text":"Accounts","page_number":22,"box":{"x":840,"y":765,"width":54,"height":7}},{"id":"fe392866-9497-40ac-84cf-827b7b452f41","block_type":"box","text":"Tony Kim 6 4 2 0 0 0","page_number":22,"box":{"x":73,"y":778,"width":798,"height":9}},{"id":"0fac824a-c8c8-46d4-a16f-9470411c3914","block_type":"box","text":"$23.41 Billion $23.72 Billion $231.78 Million $0 $0 $0","page_number":22,"box":{"x":321,"y":790,"width":553,"height":9}},{"id":"3ff997a7-57bc-4914-bca6-2e86e2e70b9a","block_type":"box","text":"Reid Menge 16 7 2 0 0 0","page_number":22,"box":{"x":74,"y":804,"width":797,"height":9}},{"id":"737464d9-b065-4bd9-8b20-abbc0e78b8e5","block_type":"box","text":"$43.53 Billion $28.24 Billion $231.78 Million $0 $0 $0","page_number":22,"box":{"x":321,"y":816,"width":553,"height":8}},{"id":"3d0c509c-97a3-4b72-b95c-d7e2f1cc87f4","block_type":"box","text":"Por tfolio Manager Compensation Overview","page_number":22,"box":{"x":69,"y":850,"width":304,"height":12}},{"id":"558baeb7-60fe-49e5-b98f-5dc085006f36","block_type":"box","text":"The discussion below describes the por tfolio managers’ compensation as of May 31, 2026.","page_number":22,"box":{"x":101,"y":873,"width":656,"height":11}},{"id":"685b078f-b6a7-402d-8cd6-d85bd4278078","block_type":"box","text":"BlackRock’s financial arrangements with its por tfolio managers, its competitive compensation and its career","page_number":22,"box":{"x":102,"y":896,"width":774,"height":11}},{"id":"ac96f8cf-4356-4336-b703-b8746d5376e2","block_type":"box","text":"path emphasis at all levels reflect the value senior management places on key resources. Compensation may include","page_number":22,"box":{"x":70,"y":911,"width":837,"height":11}},{"id":"cee6dd7d-bfb3-4cef-bf55-6c8e11234f28","block_type":"box","text":"I-20","page_number":22,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"b477b177-0b2b-427f-a641-b27e8e9fe184","block_type":"box","text":"NM1026U-5982568-22/232","page_number":22,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"9be01ff8-9858-4eb7-89d8-040dc2df34bd","block_type":"box","text":"a variety of components and may vary from year to year based on a number of factors. The principal components of","page_number":23,"box":{"x":69,"y":45,"width":823,"height":11}},{"id":"8a4904f1-a3a9-4ea4-980c-57c19e62e19e","block_type":"box","text":"compensation include a base salary, a per formance-based discretionary bonus, par ticipation in various benefits","page_number":23,"box":{"x":69,"y":60,"width":799,"height":11}},{"id":"c2158818-fd5b-42b4-87d0-2b9f27d97492","block_type":"box","text":"programs and one or more of the incentive compensation programs established by BlackRock.","page_number":23,"box":{"x":70,"y":75,"width":670,"height":11}},{"id":"55b27b74-395a-4275-a0cd-7be8a464927a","block_type":"box","text":"Base Compensation.","page_number":23,"box":{"x":102,"y":98,"width":148,"height":11}},{"id":"a9b82790-0292-4598-9a0a-965fae0b0a79","block_type":"box","text":"Generally, por tfolio managers receive base compensation based on their position with the","page_number":23,"box":{"x":257,"y":98,"width":640,"height":11}},{"id":"8c9ff66f-cfb4-4d0d-b015-bc5473d499e1","block_type":"box","text":"firm.","page_number":23,"box":{"x":68,"y":113,"width":32,"height":9}},{"id":"0ba5ae5d-541e-4312-8266-26d43ed363cc","block_type":"box","text":"Discretionary Incentive Compensation","page_number":23,"box":{"x":69,"y":143,"width":277,"height":11}},{"id":"37444776-1a9d-4d4f-a412-9150d3918f86","block_type":"box","text":"Generally, discretionary incentive compensation for Fundamental Equities por tfolio managers is based on a","page_number":23,"box":{"x":102,"y":166,"width":763,"height":11}},{"id":"a390ad41-ba17-4658-be01-c769a9c18ef7","block_type":"box","text":"formulaic compensation program. BlackRock’s formulaic por tfolio manager compensation program is based on team","page_number":23,"box":{"x":68,"y":181,"width":832,"height":11}},{"id":"525ee484-6036-4cb2-bdd0-980f4df5c9b9","block_type":"box","text":"revenue and pre-tax investment per formance relative to appropriate competitors or benchmarks over 3- and 5-year","page_number":23,"box":{"x":69,"y":196,"width":815,"height":11}},{"id":"83e6bb21-e988-498a-93a8-4e87302c7523","block_type":"box","text":"per formance periods, as applicable. In most cases, these benchmarks are the same as the benchmark or","page_number":23,"box":{"x":70,"y":211,"width":757,"height":11}},{"id":"341fd438-fe15-4fae-b759-274e081fcb05","block_type":"box","text":"benchmarks against which the per formance of the Fund or other accounts managed by the por tfolio managers are","page_number":23,"box":{"x":69,"y":226,"width":814,"height":11}},{"id":"aa53234e-de45-4ba5-802e-ba5905342293","block_type":"box","text":"measured. BlackRock’s global compensation team determines the benchmarks or rankings against which the","page_number":23,"box":{"x":69,"y":241,"width":780,"height":11}},{"id":"8966f25f-4432-485b-b1a7-8a792870fcb0","block_type":"box","text":"per formance of funds and other accounts managed by each por tfolio management team is compared and the period","page_number":23,"box":{"x":70,"y":256,"width":829,"height":12}},{"id":"9c9a3052-7e38-4a67-8b42-753fdb3f578e","block_type":"box","text":"of time over which per formance is evaluated. With respect to these por tfolio managers, such benchmarks for the","page_number":23,"box":{"x":69,"y":271,"width":806,"height":12}},{"id":"5a00bd86-3427-4544-b564-f2b759fd762d","block_type":"box","text":"Fund and other accounts are: MSCI ACWI 25% Call Overwrite Index; MSCI All Country World Index (Net Total Return);","page_number":23,"box":{"x":70,"y":287,"width":825,"height":11}},{"id":"f7c48c02-757d-430d-96b1-c17415867eaa","block_type":"box","text":"MSCI All Country World Information Technology- Net Return in USD.","page_number":23,"box":{"x":70,"y":302,"width":474,"height":11}},{"id":"7de1c5c4-3693-4a49-ad89-09a785dc3ac0","block_type":"box","text":"A smaller element of por tfolio manager discretionary compensation may include consideration of: financial","page_number":23,"box":{"x":101,"y":324,"width":759,"height":12}},{"id":"59ecad44-f255-4849-852f-1af3a1f1c2f0","block_type":"box","text":"results, expense control, profit margins, strategic planning and implementation, quality of client service, market","page_number":23,"box":{"x":69,"y":339,"width":798,"height":12}},{"id":"fef4e4d8-5266-4a3f-8df5-109615cc7d72","block_type":"box","text":"share, corporate reputation, capital allocation, compliance and risk control, leadership, technology and innovation.","page_number":23,"box":{"x":69,"y":355,"width":814,"height":11}},{"id":"13e8d9c5-7740-425a-b751-bcbc6eb5772c","block_type":"box","text":"These factors are considered collectively by BlackRock management and the relevant Chief Investment Officers.","page_number":23,"box":{"x":68,"y":370,"width":798,"height":11}},{"id":"2b042341-4d67-45d6-8d2e-6ba80c70125e","block_type":"box","text":"Distribution of Discretionary Incentive Compensation.","page_number":23,"box":{"x":102,"y":392,"width":389,"height":11}},{"id":"14092eda-d778-47b5-9c78-3cdc1d725d0d","block_type":"box","text":"Discretionary incentive compensation is distributed to","page_number":23,"box":{"x":499,"y":393,"width":383,"height":11}},{"id":"d80815cb-e9f7-44a0-be2f-9772659b0858","block_type":"box","text":"por tfolio managers in a combination of cash, deferred BlackRock, Inc. stock awards, and/or deferred cash awards","page_number":23,"box":{"x":70,"y":407,"width":815,"height":12}},{"id":"2856618b-c184-4c2b-9332-77df35b95288","block_type":"box","text":"that notionally track the return of cer tain BlackRock investment products.","page_number":23,"box":{"x":68,"y":423,"width":522,"height":11}},{"id":"2e90ebf6-70ea-4cf8-a875-8eccf699cc4a","block_type":"box","text":"Por tfolio managers receive their annual discretionary incentive compensation in the form of cash. Por tfolio","page_number":23,"box":{"x":102,"y":445,"width":760,"height":12}},{"id":"5540f67c-eee9-424f-a42d-821ed631f8bc","block_type":"box","text":"managers whose total compensation is above a specified threshold also receive deferred BlackRock, Inc. stock","page_number":23,"box":{"x":69,"y":460,"width":795,"height":12}},{"id":"09c39c80-d98a-4083-97f8-9be87a62c12a","block_type":"box","text":"awards annually as par t of their discretionary incentive compensation. Paying a por tion of discretionary incentive","page_number":23,"box":{"x":69,"y":475,"width":805,"height":12}},{"id":"6a077ad6-a616-4685-a05c-03f8402bb141","block_type":"box","text":"compensation in the form of deferred BlackRock, Inc. stock puts compensation earned by a por tfolio manager for a","page_number":23,"box":{"x":69,"y":491,"width":822,"height":11}},{"id":"e00f9be3-a36d-4a5f-b145-8bff22d9d660","block_type":"box","text":"given year “at risk” based on BlackRock’s ability to sustain and improve its per formance over future periods. In some","page_number":23,"box":{"x":68,"y":506,"width":839,"height":11}},{"id":"37d985b2-f34c-49a4-be6e-e24e5c668248","block_type":"box","text":"cases, additional deferred BlackRock, Inc. stock may be granted to cer tain key employees as par t of a long-term","page_number":23,"box":{"x":69,"y":521,"width":802,"height":11}},{"id":"b459436f-5bdd-4dde-903d-8c95224e5fe7","block_type":"box","text":"incentive award to aid in retention, align interests with long-term shareholders and motivate per formance. Deferred","page_number":23,"box":{"x":70,"y":536,"width":820,"height":11}},{"id":"4ac09cad-a504-48c8-85f2-3f2d466aab32","block_type":"box","text":"BlackRock, Inc. stock awards are generally granted in the form of BlackRock, Inc. restricted stock units that vest","page_number":23,"box":{"x":70,"y":551,"width":801,"height":11}},{"id":"ced1bd0e-820b-4bf6-b4ae-346b10fe9f8d","block_type":"box","text":"pursuant to the terms of the applicable plan and, once vested, settle in BlackRock, Inc. common stock. The por tfolio","page_number":23,"box":{"x":70,"y":566,"width":831,"height":11}},{"id":"ad5879ae-e7a0-4ca7-808a-a5143b2daf51","block_type":"box","text":"managers of this Fund have deferred BlackRock, Inc. stock awards.","page_number":23,"box":{"x":69,"y":581,"width":479,"height":12}},{"id":"6f49b03c-1b09-495c-83a3-99a71a63478f","block_type":"box","text":"For cer tain por tfolio managers, a por tion of the discretionary incentive compensation is also distributed in the","page_number":23,"box":{"x":102,"y":604,"width":785,"height":11}},{"id":"78d64164-8e9a-49d5-81bd-3acbe6799bb9","block_type":"box","text":"form of deferred cash awards that notionally track the returns of select BlackRock investment products they manage,","page_number":23,"box":{"x":68,"y":619,"width":836,"height":11}},{"id":"03655965-8df6-427a-8910-a9fa939b5954","block_type":"box","text":"which provides direct alignment of por tfolio manager discretionary incentive compensation with investment product","page_number":23,"box":{"x":68,"y":634,"width":821,"height":12}},{"id":"d61be8a8-ad7c-4ae6-b84f-8fdca85a01b9","block_type":"box","text":"results. Deferred cash awards vest ratably over a number of years and, once vested, settle in the form of cash. Only","page_number":23,"box":{"x":69,"y":649,"width":829,"height":12}},{"id":"fd5c54fd-8d55-4857-99d7-109579c47315","block_type":"box","text":"por tfolio managers who manage specified products and whose total compensation is above a specified threshold are","page_number":23,"box":{"x":70,"y":664,"width":835,"height":12}},{"id":"c653fb36-00e1-4a1c-a8a2-63e22c563a18","block_type":"box","text":"eligible to par ticipate in the deferred cash award program.","page_number":23,"box":{"x":69,"y":680,"width":414,"height":11}},{"id":"5bd48146-bed8-45fb-8f59-2c6e61e35af4","block_type":"box","text":"Other Compensation Benefits.","page_number":23,"box":{"x":101,"y":702,"width":218,"height":11}},{"id":"38099fdd-dfdd-44e7-9559-f8393a3b34f5","block_type":"box","text":"In addition to base salary and discretionary incentive compensation, por tfolio","page_number":23,"box":{"x":327,"y":702,"width":552,"height":11}},{"id":"1e714e5d-0ffd-4882-ab0c-6185f0efda4e","block_type":"box","text":"managers may be eligible to receive or par ticipate in one or more of the following:","page_number":23,"box":{"x":69,"y":717,"width":582,"height":12}},{"id":"94b5ca41-b6ba-4aad-bb89-ce1140a94ebe","block_type":"box","text":"Incentive Savings Plans","page_number":23,"box":{"x":102,"y":740,"width":167,"height":11}},{"id":"9e0adbd4-6bde-49c8-959d-3cf79760ed95","block_type":"box","text":"— BlackRock, Inc. has created a variety of incentive savings plans in which BlackRock","page_number":23,"box":{"x":274,"y":740,"width":614,"height":11}},{"id":"9ecb0036-64c4-409d-b5f7-9527de79cf1f","block_type":"box","text":"employees are eligible to par ticipate, including a 401(k) plan, the BlackRock Retirement Savings Plan (RSP), and the","page_number":23,"box":{"x":69,"y":755,"width":831,"height":11}},{"id":"cfd940a6-84ed-4e93-ac2a-b601255ade15","block_type":"box","text":"BlackRock Employee Stock Purchase Plan (ESPP). The employer contribution components of the RSP include a","page_number":23,"box":{"x":70,"y":770,"width":785,"height":11}},{"id":"f96f263f-fa9b-4ece-80f0-51f4a7d18a0f","block_type":"box","text":"company match equal to 50% of the first 8% of eligible pay contributed to the plan capped at $5,000 per year, and a","page_number":23,"box":{"x":69,"y":785,"width":830,"height":12}},{"id":"266d35b5-d324-4f41-9406-a419f3249551","block_type":"box","text":"company retirement contribution equal to 3-5% of eligible compensation up to the Internal Revenue Service limit","page_number":23,"box":{"x":69,"y":801,"width":799,"height":11}},{"id":"52a4ebce-784c-4865-a630-b475bc743486","block_type":"box","text":"($360,000 for 2026). The RSP offers a range of investment options, including registered investment companies and","page_number":23,"box":{"x":69,"y":815,"width":831,"height":12}},{"id":"9b9054cf-9cc8-4469-8566-0d96e47cb1be","block_type":"box","text":"collective investment funds managed by the firm. BlackRock contributions follow the investment direction set by","page_number":23,"box":{"x":69,"y":831,"width":798,"height":11}},{"id":"8f6d09a3-7376-4582-8186-60bc72d40297","block_type":"box","text":"par ticipants for their own contributions or, absent par ticipant investment direction, are invested into a target date","page_number":23,"box":{"x":70,"y":846,"width":809,"height":11}},{"id":"6093fc42-d2bf-48b1-aa6b-ebf107ccb43e","block_type":"box","text":"fund that corresponds to, or is closest to, the year in which the par ticipant attains age 65. The ESPP allows for","page_number":23,"box":{"x":68,"y":861,"width":793,"height":11}},{"id":"1a5d7648-1539-4e8e-864c-10d8dd6ddd18","block_type":"box","text":"investment in BlackRock common stock at a 5% discount on the fair market value of the stock on the purchase date.","page_number":23,"box":{"x":70,"y":876,"width":832,"height":11}},{"id":"3dd572b6-2856-42b6-9aa9-6394e15ba5ae","block_type":"box","text":"Annual par ticipation in the ESPP is limited to the purchase of 1,000 shares of common stock or a dollar value of","page_number":23,"box":{"x":68,"y":891,"width":805,"height":11}},{"id":"76de6967-8c51-458b-b44a-c626efaa88f4","block_type":"box","text":"I-21","page_number":23,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"6c47e239-901a-40cc-ba3c-95185772e78e","block_type":"box","text":"NM1026U-5982568-23/232","page_number":23,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"2dbd9416-f808-41d6-be04-6e77aa2d92f7","block_type":"box","text":"$25,000 based on its fair market value on the purchase date. All of the eligible por tfolio managers are eligible to","page_number":24,"box":{"x":69,"y":44,"width":808,"height":12}},{"id":"4f49d2ac-d006-483c-b1aa-15932e061b45","block_type":"box","text":"par ticipate in these plans.","page_number":24,"box":{"x":70,"y":60,"width":185,"height":11}},{"id":"36d54a82-3511-42e4-977f-c1e618d0b491","block_type":"box","text":"Por tfolio Manager Beneficial Holdings","page_number":24,"box":{"x":69,"y":90,"width":268,"height":11}},{"id":"04dd9f81-28e7-4f89-96a2-2996514fded6","block_type":"box","text":"As of May 31, 2026, the Fund’s most recently completed fiscal year end, the dollar range of securities","page_number":24,"box":{"x":101,"y":113,"width":731,"height":11}},{"id":"4d8d6b9d-fcfa-434c-8e2f-89ec89e3b99c","block_type":"box","text":"beneficially owned by the por tfolio managers in the Fund is shown below:","page_number":24,"box":{"x":69,"y":128,"width":519,"height":11}},{"id":"d6b98086-f054-40b2-a80f-e59b0308c884","block_type":"box","text":"Portfolio Manager","page_number":24,"box":{"x":69,"y":166,"width":105,"height":9}},{"id":"a1a4ae5c-23a1-4b51-9c63-5441684e307f","block_type":"box","text":"Dollar Range of Equity","page_number":24,"box":{"x":759,"y":156,"width":129,"height":9}},{"id":"d0f85ec8-4c36-4505-8709-68931cd8f095","block_type":"box","text":"Securities Beneficially Owned","page_number":24,"box":{"x":736,"y":166,"width":173,"height":9}},{"id":"d944503b-8e54-4282-9f89-4a5d6e04093e","block_type":"box","text":"Tony Kim . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Over $1,","page_number":24,"box":{"x":68,"y":183,"width":752,"height":12}},{"id":"ab848d7b-c49e-4bdb-a3b8-c47d1a764d36","block_type":"box","text":"000,000","page_number":24,"box":{"x":822,"y":184,"width":63,"height":10}},{"id":"d724a36c-620f-4c35-bbc0-10ad8333a6fa","block_type":"box","text":"Reid Menge . . .","page_number":24,"box":{"x":70,"y":199,"width":105,"height":11}},{"id":"5677ce48-ee37-4038-9275-6a569a0f8db5","block_type":"box","text":".................................................................","page_number":24,"box":{"x":182,"y":206,"width":523,"height":2}},{"id":"f81f48d4-d989-48f3-8224-3cb8447e8a76","block_type":"box","text":"$100,001-$500,000","page_number":24,"box":{"x":749,"y":198,"width":148,"height":11}},{"id":"f18f73ff-480c-4206-ae7d-bcdc7b86fcb3","block_type":"box","text":"Por tfolio Manager Potential Material Conflicts of Interest","page_number":24,"box":{"x":69,"y":230,"width":403,"height":12}},{"id":"435ae6f4-bdb1-4048-91d6-024a75cd9866","block_type":"box","text":"BlackRock has built a professional working environment, firm-wide compliance culture and compliance","page_number":24,"box":{"x":102,"y":253,"width":727,"height":11}},{"id":"e1002bfd-405a-47cd-a5f0-dfd1368ef067","block_type":"box","text":"procedures and systems designed to protect against potential incentives that may favor one account over another.","page_number":24,"box":{"x":70,"y":268,"width":814,"height":12}},{"id":"b75a939c-5c18-4230-a458-3ce528bd485e","block_type":"box","text":"BlackRock has adopted policies and procedures that address the allocation of investment oppor tunities, execution of","page_number":24,"box":{"x":70,"y":283,"width":837,"height":11}},{"id":"edd5b20a-8d67-4079-ae0b-2e4759ec48ab","block_type":"box","text":"por tfolio transactions, personal trading by employees and other potential conflicts of interest that are designed to","page_number":24,"box":{"x":70,"y":298,"width":810,"height":12}},{"id":"6ba90b47-9319-4df7-8af4-88710332cddf","block_type":"box","text":"ensure that all client accounts are treated equitably over time. Never theless, BlackRock furnishes investment","page_number":24,"box":{"x":69,"y":314,"width":782,"height":11}},{"id":"0e474a2d-ebc6-4a2a-ad94-0dacb3d50f6e","block_type":"box","text":"management and advisory services to numerous clients in addition to the Fund, and BlackRock may, consistent with","page_number":24,"box":{"x":69,"y":329,"width":830,"height":11}},{"id":"df21b1cd-7de6-4fb2-b332-8134a824d756","block_type":"box","text":"applicable law, make investment recommendations to other clients or accounts (including accounts which are hedge","page_number":24,"box":{"x":69,"y":344,"width":828,"height":11}},{"id":"d314cff5-fb6b-434e-a81b-8c2e5026b3a1","block_type":"box","text":"funds or have per formance or higher fees paid to BlackRock, or in which por tfolio managers have a personal interest","page_number":24,"box":{"x":68,"y":359,"width":834,"height":11}},{"id":"1a8e47f2-d50c-43c1-abe1-c700abe9500f","block_type":"box","text":"in the receipt of such fees), which may be the same as or different from those made to the Fund. In addition,","page_number":24,"box":{"x":70,"y":374,"width":777,"height":11}},{"id":"c685ce8c-75e4-470a-870e-299b0b77e2de","block_type":"box","text":"BlackRock, its affiliates and significant shareholders and any officer, director, shareholder or employee may or may","page_number":24,"box":{"x":70,"y":389,"width":821,"height":11}},{"id":"1958c536-4bf8-46b7-a95b-f66e0f0eaf1f","block_type":"box","text":"not have an interest in the securities whose purchase and sale BlackRock recommends to the Fund. BlackRock, or","page_number":24,"box":{"x":69,"y":405,"width":819,"height":10}},{"id":"2cdf4cb1-20e1-4899-a6a8-ab3ed3fc9819","block_type":"box","text":"any of its affiliates or significant shareholders, or any officer, director, shareholder, employee or any member of their","page_number":24,"box":{"x":69,"y":419,"width":832,"height":12}},{"id":"641f895e-fc0d-4691-9ef5-ea945210e5e0","block_type":"box","text":"families may take different actions than those recommended to the Fund by BlackRock with respect to the same","page_number":24,"box":{"x":68,"y":435,"width":804,"height":11}},{"id":"8d5d1ea7-caf8-4f66-9d83-6e0c770a83f7","block_type":"box","text":"securities. Moreover, BlackRock may refrain from rendering any advice or services concerning securities of","page_number":24,"box":{"x":69,"y":450,"width":760,"height":11}},{"id":"2439a85f-0547-4803-a1a6-915c5e136921","block_type":"box","text":"companies of which any of BlackRock’s (or its affiliates’ or significant shareholders’) officers, directors or employees","page_number":24,"box":{"x":69,"y":465,"width":834,"height":11}},{"id":"789e1a6f-b5ca-4117-9123-55c59b399dec","block_type":"box","text":"are directors or officers, or companies as to which BlackRock or any of its affiliates or significant shareholders or the","page_number":24,"box":{"x":69,"y":480,"width":836,"height":11}},{"id":"3b775e31-f043-4c47-9754-cf4fff1873dd","block_type":"box","text":"officers, directors and employees of any of them has any substantial economic interest or possesses material non","page_number":24,"box":{"x":69,"y":495,"width":822,"height":11}},{"id":"0566de46-756e-4936-9cf0-b6e2f7c457dc","block_type":"box","text":"public information. Cer tain por tfolio managers also may manage accounts whose investment strategies may at times","page_number":24,"box":{"x":70,"y":510,"width":835,"height":11}},{"id":"9568cb4e-9fdc-4a7c-b897-b023c140c1b6","block_type":"box","text":"be opposed to the strategy utilized for the Fund. It should also be noted that Messrs. Kim and Menge may be","page_number":24,"box":{"x":69,"y":525,"width":779,"height":12}},{"id":"b6acfdb4-234f-4306-a0c4-03772b592c46","block_type":"box","text":"managing hedge fund and/or long only accounts, or may be par t of a team managing hedge fund and/or long only","page_number":24,"box":{"x":69,"y":540,"width":811,"height":12}},{"id":"2cccb7e3-58e9-463a-aaea-1e18d34ac5f4","block_type":"box","text":"accounts, subject to incentive fees. Messrs. Kim and Menge may therefore be entitled to receive a por tion of any","page_number":24,"box":{"x":69,"y":555,"width":809,"height":12}},{"id":"88250891-4442-4e55-945e-308ef6fc4485","block_type":"box","text":"incentive fees earned on such accounts.","page_number":24,"box":{"x":70,"y":571,"width":286,"height":9}},{"id":"0ac3ccdc-a6c9-47f3-817c-ffc7500c401f","block_type":"box","text":"As a fiduciary, BlackRock owes a duty of loyalty to its clients and must treat each client fairly. When BlackRock","page_number":24,"box":{"x":101,"y":593,"width":788,"height":11}},{"id":"e69f5388-b13f-43c0-a1bf-98f6dc4cad32","block_type":"box","text":"purchases or sells securities for more than one account, the trades must be allocated in a manner consistent with its","page_number":24,"box":{"x":70,"y":608,"width":839,"height":11}},{"id":"153a42fa-c73a-4712-aa28-efad5d5d00fb","block_type":"box","text":"fiduciary duties. BlackRock attempts to allocate investments in a fair and equitable manner among client accounts,","page_number":24,"box":{"x":68,"y":623,"width":823,"height":12}},{"id":"7d667d6a-2ed8-44d8-9121-cedcc738f682","block_type":"box","text":"with no account receiving preferential treatment. To this end, BlackRock has adopted policies that are intended to","page_number":24,"box":{"x":68,"y":639,"width":812,"height":11}},{"id":"64814c39-1d56-4edb-af6a-4eae78e5b2a7","block_type":"box","text":"ensure reasonable efficiency in client transactions and provide BlackRock with sufficient flexibility to allocate","page_number":24,"box":{"x":69,"y":654,"width":777,"height":11}},{"id":"cdfc8780-9cd6-40c4-ab29-1c721617ee03","block_type":"box","text":"investments in a manner that is consistent with the par ticular investment discipline and client base, as appropriate.","page_number":24,"box":{"x":70,"y":669,"width":826,"height":11}},{"id":"c09b0ce3-122f-42a8-a943-6827c15b74c7","block_type":"box","text":"Accounting Services","page_number":24,"box":{"x":68,"y":699,"width":150,"height":11}},{"id":"3677f58d-445b-46db-81b7-68f24a3b70a0","block_type":"box","text":"The Bank of New York Mellon (“BNY”) serves as the accounting services provider for the Fund. BNY records","page_number":24,"box":{"x":101,"y":722,"width":767,"height":11}},{"id":"69ae2835-7de9-4751-a264-32ba1dd65300","block_type":"box","text":"investment, capital share and income and expense activities; verifies and transmits trade tickets; maintains","page_number":24,"box":{"x":70,"y":737,"width":769,"height":11}},{"id":"c8b87a43-17f0-4e4e-865b-7fbee2a8e650","block_type":"box","text":"accounting ledgers for investment securities; maintains tax lots; reconciles cash with the Fund’s custodian; repor ts","page_number":24,"box":{"x":69,"y":752,"width":823,"height":11}},{"id":"3e732231-f55e-4ecb-903e-990df6af9a38","block_type":"box","text":"cash balances to BlackRock; prepares cer tain financial statements; calculates expenses, gains, losses and income;","page_number":24,"box":{"x":69,"y":767,"width":830,"height":11}},{"id":"805ed14d-e7c2-4544-8751-b09d559345f8","block_type":"box","text":"controls disbursements; works with independent pricing sources; and computes and repor ts net asset value. 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BNY, among other responsibilities, maintains a custody account or accounts in the name","page_number":25,"box":{"x":68,"y":82,"width":836,"height":12}},{"id":"7b546b0b-b420-40a6-8cfc-1087237187cf","block_type":"box","text":"of the Fund, receives and delivers all assets for the Fund upon purchase and upon sale or maturity, and collects and","page_number":25,"box":{"x":69,"y":98,"width":829,"height":11}},{"id":"10c44b20-b9ae-40be-849d-5c4dd63baa63","block_type":"box","text":"receives all income and other payments and distributions on account of the assets of the Fund.","page_number":25,"box":{"x":69,"y":113,"width":680,"height":11}},{"id":"904fb6ad-d82e-4d34-bc11-326e8fd1b5e7","block_type":"box","text":"Transfer Agent","page_number":25,"box":{"x":68,"y":143,"width":107,"height":11}},{"id":"4c71c2ce-4a07-4950-bdbe-1cf65f2f896a","block_type":"box","text":"BNY, which has its principal place of business at 118 Flanders Road, Westborough, Massachusetts 01581,","page_number":25,"box":{"x":102,"y":166,"width":767,"height":11}},{"id":"e47e6044-7b81-4114-a9f1-8b922d8c98de","block_type":"box","text":"serves as the transfer agent and dividend disbursing agent for the Fund.","page_number":25,"box":{"x":69,"y":181,"width":515,"height":11}},{"id":"f2f85362-4810-48d7-b15b-92fea430cce6","block_type":"box","text":"Credit Agreement","page_number":25,"box":{"x":69,"y":211,"width":129,"height":11}},{"id":"5c3be7c7-44ed-4156-9269-b476a2a7bb73","block_type":"box","text":"The Trust, on behalf of the Fund, along with cer tain other funds managed by the Manager and its affiliates","page_number":25,"box":{"x":101,"y":234,"width":757,"height":11}},{"id":"f6f054be-1755-4de7-9f27-83eac9fe0f77","block_type":"box","text":"(“Par ticipating Funds”), is a par ty to a 364-day, $2.4 billion credit agreement with a group of lenders, which facility","page_number":25,"box":{"x":69,"y":248,"width":817,"height":12}},{"id":"31292d22-f822-4b25-9876-87c6642620cd","block_type":"box","text":"terminates on April 8, 2027, unless otherwise extended or renewed (the “Credit Agreement”). Excluding","page_number":25,"box":{"x":68,"y":264,"width":743,"height":11}},{"id":"19e5d759-6502-4650-8283-e72a64b7193e","block_type":"box","text":"commitments designated for cer tain Par ticipating Funds, the Par ticipating Funds, including the Fund, can borrow up","page_number":25,"box":{"x":69,"y":279,"width":825,"height":11}},{"id":"5d6b1fc9-8b84-4409-abef-9793020bb0b8","block_type":"box","text":"to an aggregate commitment amount of $1.75 billion at any time outstanding, subject to asset coverage and other","page_number":25,"box":{"x":68,"y":293,"width":818,"height":12}},{"id":"426ecc15-b008-4e22-b2b7-89b1c819c448","block_type":"box","text":"limitations as specified in the Credit Agreement. The Fund may borrow under the Credit Agreement to meet","page_number":25,"box":{"x":70,"y":309,"width":761,"height":11}},{"id":"d27e6474-f23e-48c3-b244-b6a8d6b77cf4","block_type":"box","text":"shareholder redemptions and for other lawful purposes. However, the Fund may not borrow under the Credit","page_number":25,"box":{"x":69,"y":324,"width":768,"height":11}},{"id":"bc38161d-8002-4c0b-81f7-a3011282294f","block_type":"box","text":"Agreement for leverage. The Fund may borrow up to the maximum amount allowable under its current Prospectuses","page_number":25,"box":{"x":68,"y":339,"width":825,"height":12}},{"id":"bbf3351e-57f7-4167-b97d-32b2bc942bf8","block_type":"box","text":"and SAI, subject to various other legal, regulatory or contractual limits. Borrowing results in interest expense and","page_number":25,"box":{"x":69,"y":355,"width":805,"height":11}},{"id":"2eb06e5e-792a-4651-b196-190d796576c2","block_type":"box","text":"other fees and expenses for the Fund which may impact the Fund’s net expenses. The costs of borrowing may reduce","page_number":25,"box":{"x":69,"y":370,"width":838,"height":11}},{"id":"d7945e89-d6c0-4c7e-9e20-6b132d66a743","block_type":"box","text":"the Fund’s return. The Fund is charged its pro rata share of upfront fees and commitment fees on the aggregate","page_number":25,"box":{"x":68,"y":385,"width":801,"height":11}},{"id":"4730f673-6bbb-46a0-951b-7dbfb2aaa8bf","block_type":"box","text":"commitment amount based on its net assets. If the Fund borrows pursuant to the Credit Agreement, the Fund will be","page_number":25,"box":{"x":69,"y":400,"width":833,"height":11}},{"id":"9c640cf6-8f97-4126-a38d-4289186c7894","block_type":"box","text":"charged interest at a variable rate.","page_number":25,"box":{"x":69,"y":415,"width":245,"height":11}},{"id":"16b1caae-56b2-41b7-a406-52769a95ed41","block_type":"box","text":"V. Information on Sales Charges and Distribution Related Expenses","page_number":25,"box":{"x":68,"y":445,"width":491,"height":11}},{"id":"f709353e-4882-40b8-b7f3-dfa63e0e297f","block_type":"box","text":"Set for th below is information on sales charges (including any contingent deferred sales charges (“CDSCs”))","page_number":25,"box":{"x":102,"y":468,"width":773,"height":11}},{"id":"40c24d77-2d74-4a95-95c5-0d7a90be788e","block_type":"box","text":"received by the Fund, including the amounts paid to affiliates of the Manager (“affiliates”) for the past three fiscal","page_number":25,"box":{"x":69,"y":483,"width":812,"height":11}},{"id":"115330d7-3a05-47a8-8339-1231e9bdca86","block_type":"box","text":"years. BlackRock Investments, LLC (“BRIL” or the “Distributor”) acts as the Fund’s sole distributor.","page_number":25,"box":{"x":68,"y":498,"width":706,"height":11}},{"id":"b7bdacc8-234c-4f1b-ae20-7c094abe90bd","block_type":"box","text":"Investor A 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$17,787","page_number":25,"box":{"x":731,"y":718,"width":174,"height":11}},{"id":"867337dc-c50e-4a6c-ad72-b1de34af8a83","block_type":"box","text":"Fiscal Year Ended May 31, 2024 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .","page_number":25,"box":{"x":70,"y":734,"width":474,"height":11}},{"id":"b6889521-e877-4655-8cf7-961a9f020f55","block_type":"box","text":".................","page_number":25,"box":{"x":550,"y":741,"width":132,"height":2}},{"id":"e771a732-49a3-41e1-9d49-cb53066161ca","block_type":"box","text":"$14,023 $14,023","page_number":25,"box":{"x":731,"y":733,"width":175,"height":11}},{"id":"37039e2d-3968-4037-b06d-682e55d35dc6","block_type":"box","text":"The table below provides information for the fiscal year ended May 31, 2026 shown about the 12b-1 fees the","page_number":25,"box":{"x":101,"y":758,"width":781,"height":11}},{"id":"5e07e12d-b937-4689-bab5-0c5e86c1dd4e","block_type":"box","text":"Fund paid to BRIL under the Fund’s 12b-1 plan. A por tion of the fees collected by BRIL were paid to affiliates for","page_number":25,"box":{"x":70,"y":773,"width":800,"height":11}},{"id":"ab31bf57-7064-44f8-9c91-9f2d80140fb1","block_type":"box","text":"providing shareholder servicing activities for Investor A and Service Shares and for providing shareholder servicing","page_number":25,"box":{"x":70,"y":788,"width":815,"height":11}},{"id":"e96ea9be-d242-4be3-8017-6ce99b1e41a8","block_type":"box","text":"and distribution-related activities and services for Investor C and Class R Shares.","page_number":25,"box":{"x":69,"y":803,"width":579,"height":9}},{"id":"ad8b92b0-a3a0-4498-a8e4-ed666a6a8de0","block_type":"box","text":"Class Name","page_number":25,"box":{"x":69,"y":831,"width":68,"height":7}},{"id":"c5418835-a212-4562-9d1b-f2aebe11d7e0","block_type":"box","text":"Fees Paid to BRIL","page_number":25,"box":{"x":806,"y":831,"width":103,"height":7}},{"id":"85316cf0-d394-4ec9-aee5-2ccab750c007","block_type":"box","text":"Investor A Shares .","page_number":25,"box":{"x":70,"y":849,"width":134,"height":9}},{"id":"8c0fa06f-d0f8-44ef-bf1c-423feb589323","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $6,","page_number":25,"box":{"x":210,"y":848,"width":626,"height":12}},{"id":"7c6ffd6d-cda0-4284-8cdc-23a7fa81235e","block_type":"box","text":"148,208","page_number":25,"box":{"x":839,"y":849,"width":62,"height":11}},{"id":"17bd8fae-d663-4a4e-a4e7-4ab77ede4c05","block_type":"box","text":"Investor C Shares . . .","page_number":25,"box":{"x":70,"y":864,"width":150,"height":9}},{"id":"b5173dda-8348-478c-9248-2083337f11f3","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $3,","page_number":25,"box":{"x":226,"y":864,"width":610,"height":11}},{"id":"a9a94dd2-d1c4-4a1c-9818-33c9762a0f17","block_type":"box","text":"127,385","page_number":25,"box":{"x":839,"y":864,"width":61,"height":11}},{"id":"5a565d76-b22b-4dfa-bcb0-b6d7ea456b15","block_type":"box","text":"Class R Shares","page_number":25,"box":{"x":69,"y":879,"width":109,"height":9}},{"id":"652f30d9-bf5c-406b-9d41-0d53395cec6c","block_type":"box","text":"......................................................................... $","page_number":25,"box":{"x":185,"y":879,"width":637,"height":10}},{"id":"003f4ef5-cccb-44fb-9d95-69dd165abbbd","block_type":"box","text":"287,081","page_number":25,"box":{"x":839,"y":879,"width":62,"height":11}},{"id":"7647919e-1ee2-444a-a0b5-512d3fdcd67d","block_type":"box","text":"Service Shares . .","page_number":25,"box":{"x":69,"y":895,"width":126,"height":8}},{"id":"4bccde62-76a2-4b00-88dd-870bb7e1a8c1","block_type":"box","text":"....................................................................... $","page_number":25,"box":{"x":202,"y":894,"width":620,"height":10}},{"id":"94a57f91-3b3d-4430-a48c-3104a10b723b","block_type":"box","text":"139,171","page_number":25,"box":{"x":839,"y":895,"width":62,"height":10}},{"id":"d5041c44-3694-4be8-abd5-8e72e927f54c","block_type":"box","text":"I-23","page_number":25,"box":{"x":476,"y":943,"width":26,"height":9}},{"id":"b33f2abc-dd02-44b8-9181-535b7f2f9b10","block_type":"box","text":"NM1026U-5982568-25/232","page_number":25,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"b082de67-3407-4f47-9d99-760633e25223","block_type":"box","text":"VI. Computation of Offering Price Per Share","page_number":26,"box":{"x":68,"y":45,"width":318,"height":11}},{"id":"08a4546a-35f4-412c-9b14-1872c49b8af0","block_type":"box","text":"An illustration of the computation of the offering price of the Investor A Shares of the Fund based on the value of","page_number":26,"box":{"x":101,"y":67,"width":805,"height":12}},{"id":"b69bb5cc-816e-4c18-b7b8-dce026c7bcb2","block_type":"box","text":"the Fund’s Investor A Shares’ net assets and the number of Investor A Shares outstanding on May 31, 2026, is set","page_number":26,"box":{"x":68,"y":82,"width":827,"height":12}},{"id":"93640835-cc40-4ae8-b015-09d77307ef84","block_type":"box","text":"for th below.","page_number":26,"box":{"x":68,"y":98,"width":83,"height":9}},{"id":"dbd1b3df-4649-46cd-9c50-ebc828edfb5b","block_type":"box","text":"Investor A Shares","page_number":26,"box":{"x":798,"y":126,"width":102,"height":7}},{"id":"2a617e47-04dc-4f27-befe-322d1c15d11f","block_type":"box","text":"Net Assets . . .","page_number":26,"box":{"x":70,"y":144,"width":100,"height":9}},{"id":"e6c3fd6a-4dae-49f0-9a57-88a12a79d05c","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $3,247,","page_number":26,"box":{"x":176,"y":143,"width":669,"height":11}},{"id":"d94b4180-9421-411c-8fed-69d6bd50472f","block_type":"box","text":"176,113","page_number":26,"box":{"x":847,"y":144,"width":62,"height":10}},{"id":"91167d81-3acc-48ab-9812-4dda4651765d","block_type":"box","text":"Number of Shares Outstanding . . . . . . . . . . . .","page_number":26,"box":{"x":70,"y":159,"width":320,"height":11}},{"id":"a41f185b-9c86-4d44-9a20-0fa1f124cad4","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33,","page_number":26,"box":{"x":396,"y":159,"width":449,"height":10}},{"id":"0e695acf-28be-4d94-9e6d-0bbc32893f1e","block_type":"box","text":"893,916","page_number":26,"box":{"x":847,"y":159,"width":62,"height":10}},{"id":"f690fdf0-0a57-4c4a-bc3c-b50b89b6d138","block_type":"box","text":"Net Asset Value Per Share (net assets divided by number of shares outstanding)","page_number":26,"box":{"x":70,"y":174,"width":571,"height":11}},{"id":"29d2acb8-2ef4-4426-8eac-86e7927eff51","block_type":"box","text":"..............","page_number":26,"box":{"x":649,"y":181,"width":108,"height":2}},{"id":"4158a5be-c2db-4505-bef3-ced757f4bff7","block_type":"box","text":"$95.80","page_number":26,"box":{"x":857,"y":173,"width":52,"height":11}},{"id":"bb548b3e-2874-4ef6-ab58-dee1f3e78b05","block_type":"box","text":"Sales Charge (5.25% of offering price; 5.54% of net asset value per share)","page_number":26,"box":{"x":69,"y":189,"width":534,"height":11}},{"id":"68b98551-034f-4709-a348-d950737bc565","block_type":"box","text":"1","page_number":26,"box":{"x":604,"y":189,"width":4,"height":5}},{"id":"3fb04d85-bc1e-41ac-92ec-1b075553ecd7","block_type":"box","text":". . . . . . . . . . . . . . . . . . $5.29","page_number":26,"box":{"x":616,"y":188,"width":293,"height":11}},{"id":"de51e48c-0ac2-42e8-8cdf-5f159f2be568","block_type":"box","text":"Offering Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .","page_number":26,"box":{"x":69,"y":208,"width":687,"height":12}},{"id":"f446b897-3321-49e3-9ab0-8cadda9791bc","block_type":"box","text":"$100.72","page_number":26,"box":{"x":847,"y":208,"width":62,"height":10}},{"id":"d82a286d-0bca-4465-a22f-786d556c31b7","block_type":"box","text":"1","page_number":26,"box":{"x":69,"y":241,"width":3,"height":3}},{"id":"b2548863-4709-4d7e-9d70-e52e6c5bb43c","block_type":"box","text":"Rounded to the nearest one-hundredth percent; assumes maximum sales charge is applicable.","page_number":26,"box":{"x":94,"y":241,"width":541,"height":8}},{"id":"d476e59b-75ed-428e-b931-f980d116dda1","block_type":"box","text":"The offering price for the Fund’s other share classes is equal to the share class’s net asset value computed as","page_number":26,"box":{"x":101,"y":261,"width":796,"height":12}},{"id":"654e7e5c-c04d-41b4-a780-2a3dda208c33","block_type":"box","text":"set for th above for Investor A Shares. Though not subject to a sales charge, cer tain share classes may be subject to","page_number":26,"box":{"x":69,"y":276,"width":833,"height":12}},{"id":"94f213b4-9b15-4bc6-9b9e-b7264de80069","block_type":"box","text":"a CDSC on redemption. For more information on the purchasing and valuation of shares, please see “Purchase of","page_number":26,"box":{"x":69,"y":292,"width":813,"height":11}},{"id":"a643f82d-a178-4e51-889b-86d43dfe6034","block_type":"box","text":"Shares” and “Pricing of Shares” in Par t II of this SAI.","page_number":26,"box":{"x":69,"y":307,"width":377,"height":11}},{"id":"bea9c34f-aef8-41b0-b49a-3a58a5bd5690","block_type":"box","text":"VII. Portfolio Transactions and Brokerage","page_number":26,"box":{"x":68,"y":337,"width":302,"height":11}},{"id":"452b8cb1-2941-4cb2-aeea-bf87d1532f83","block_type":"box","text":"See “Por tfolio Transactions and Brokerage” in Par t II of this SAI for more information.","page_number":26,"box":{"x":102,"y":360,"width":609,"height":11}},{"id":"b3178537-d4e0-4c15-9f09-7ff8825d9141","block_type":"box","text":"Information about the brokerage commissions paid by the Fund, including commissions paid to affiliates, during","page_number":26,"box":{"x":102,"y":382,"width":798,"height":12}},{"id":"ee32db00-e299-4320-b0b0-c43b1ee83045","block_type":"box","text":"the past three fiscal years is set for th in the following tables:","page_number":26,"box":{"x":68,"y":397,"width":435,"height":12}},{"id":"12143d5a-730b-43fa-8413-51074ccabf89","block_type":"box","text":"Aggregate Brokerage","page_number":26,"box":{"x":613,"y":426,"width":125,"height":9}},{"id":"aa409b66-8857-4ca3-99ca-882b7c3afac7","block_type":"box","text":"Commissions Paid","page_number":26,"box":{"x":623,"y":436,"width":106,"height":7}},{"id":"26008f6f-4eee-4e09-a511-c86e0b34b5ca","block_type":"box","text":"Brokerage Commissions","page_number":26,"box":{"x":769,"y":426,"width":140,"height":9}},{"id":"fd829df5-c890-42e9-88e3-5d4e83f07934","block_type":"box","text":"Paid to Affiliates","page_number":26,"box":{"x":791,"y":436,"width":96,"height":7}},{"id":"b71e3f56-cb85-42fe-81a9-5ce3b77396ee","block_type":"box","text":"Fiscal Year Ended May 31, 2026. . . . . . . .","page_number":26,"box":{"x":70,"y":454,"width":292,"height":11}},{"id":"c72e23c8-968b-4f70-aac3-12750c3daff5","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . $2,","page_number":26,"box":{"x":369,"y":453,"width":286,"height":11}},{"id":"2ac7d910-dce7-4cda-8fe3-cb5ab1f8fc54","block_type":"box","text":"096,772","page_number":26,"box":{"x":657,"y":454,"width":62,"height":10}},{"id":"c5b4189b-ef47-4bf2-b95b-29707ae3e23b","block_type":"box","text":"1","page_number":26,"box":{"x":720,"y":454,"width":4,"height":4}},{"id":"02c50018-0f4c-4d96-b260-d270e4e91d99","block_type":"box","text":"$0","page_number":26,"box":{"x":830,"y":453,"width":18,"height":10}},{"id":"88d22db6-4d6b-482f-b053-468ef9ab0ee3","block_type":"box","text":"Fiscal Year Ended May 31, 2025. . . . . . . .","page_number":26,"box":{"x":70,"y":469,"width":292,"height":11}},{"id":"ae508c96-7d1a-45ec-9d3f-1049db65c0bf","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . $1,","page_number":26,"box":{"x":369,"y":468,"width":286,"height":11}},{"id":"bfe5186b-9b83-4a7b-8334-94cef54c3241","block_type":"box","text":"042,686 $0","page_number":26,"box":{"x":657,"y":468,"width":191,"height":11}},{"id":"db936215-d826-43d7-a481-3b107803f598","block_type":"box","text":"Fiscal Year Ended May 31, 2024. . . . . . . .","page_number":26,"box":{"x":70,"y":484,"width":292,"height":11}},{"id":"c389ec0b-d532-4878-b290-826cbe09aa9f","block_type":"box","text":"........................... $","page_number":26,"box":{"x":369,"y":483,"width":272,"height":11}},{"id":"2eb7a277-50ad-443a-9b33-10c164714d8a","block_type":"box","text":"937,353 $0","page_number":26,"box":{"x":657,"y":483,"width":191,"height":11}},{"id":"510c9160-ab7a-446f-9a0e-4d281fabaeb4","block_type":"box","text":"1.","page_number":26,"box":{"x":69,"y":508,"width":5,"height":4}},{"id":"958af7b6-d5f7-49e3-962e-bd2971fcb7f3","block_type":"box","text":"The increase in brokerage commissions paid by the Fund as compared to the prior fiscal year was due to an increase in trading volume","page_number":26,"box":{"x":93,"y":508,"width":770,"height":9}},{"id":"f0729021-78ef-4b91-88dc-6e3b23a5dada","block_type":"box","text":"resulting from market volatility.","page_number":26,"box":{"x":94,"y":518,"width":173,"height":9}},{"id":"9d2a39e3-8b29-4c11-9c52-b6e1c36cf783","block_type":"box","text":"The following table shows the dollar amount of brokerage commissions paid to brokers for providing Section","page_number":26,"box":{"x":101,"y":539,"width":770,"height":11}},{"id":"5e97d27b-a75d-4f14-a7b3-f7730d4eb4fb","block_type":"box","text":"28(e) research/brokerage services under Section 28(e) of the Securities Exchange Act of 1934, as amended, and","page_number":26,"box":{"x":69,"y":554,"width":814,"height":12}},{"id":"03e6bd23-b31e-4675-a3b2-2b25eb1c27f0","block_type":"box","text":"the approximate dollar amount of the transactions involved for the fiscal year ended May 31, 2026. The provision of","page_number":26,"box":{"x":68,"y":569,"width":829,"height":12}},{"id":"2755460c-a11a-4f82-8af7-27c5dde0ff6e","block_type":"box","text":"Section 28(e) research/brokerage services was not necessarily a factor in the placement of all brokerage business","page_number":26,"box":{"x":69,"y":584,"width":822,"height":12}},{"id":"5555244d-34e9-4631-87a7-ca2cb65f9db2","block_type":"box","text":"with such brokers.","page_number":26,"box":{"x":68,"y":600,"width":130,"height":9}},{"id":"8847a6e3-99fe-4a4e-8326-73c32a636af3","block_type":"box","text":"Amount of Commissions","page_number":26,"box":{"x":264,"y":628,"width":141,"height":7}},{"id":"8c24a612-85ec-4207-8f17-c7a9798aabcc","block_type":"box","text":"Paid to Brokers for","page_number":26,"box":{"x":280,"y":638,"width":110,"height":7}},{"id":"15c298d6-2dee-4eb2-af3b-31a7e5c6d891","block_type":"box","text":"Providing 28(e) Eligible","page_number":26,"box":{"x":267,"y":648,"width":136,"height":9}},{"id":"5c7ee824-809e-42b6-a1d9-9c2422c8d01c","block_type":"box","text":"Research Services","page_number":26,"box":{"x":281,"y":658,"width":108,"height":7}},{"id":"6c0340ab-f9ea-4901-bb75-aaec11cb7f61","block_type":"box","text":"Amount of Brokerage","page_number":26,"box":{"x":588,"y":648,"width":124,"height":9}},{"id":"6e6391c6-159d-41d2-816f-649aa38a3783","block_type":"box","text":"Transactions Involved","page_number":26,"box":{"x":587,"y":658,"width":126,"height":7}},{"id":"cd7fee46-b037-4df9-94ed-81485994e618","block_type":"box","text":"$940,153 $3,148,738,962","page_number":26,"box":{"x":299,"y":675,"width":412,"height":11}},{"id":"e09b4c3d-a47a-4157-94d8-a9dd2515808d","block_type":"box","text":"As of May 31, 2026, the Fund held no securities of its regular brokers or dealers (as defined in Rule 10b-1 under","page_number":26,"box":{"x":101,"y":700,"width":808,"height":11}},{"id":"624e7b90-72d1-4b10-a1fb-9d4ebaa4b9ca","block_type":"box","text":"the Investment Company Act) or their parents whose shares were purchased during the fiscal year ended","page_number":26,"box":{"x":68,"y":715,"width":748,"height":11}},{"id":"56a4fcda-904d-4642-ae09-bafe43cb52d6","block_type":"box","text":"May 31, 2026.","page_number":26,"box":{"x":70,"y":730,"width":104,"height":11}},{"id":"a6013c5a-6897-453d-970b-5b8379043c3f","block_type":"box","text":"Securities Lending","page_number":26,"box":{"x":68,"y":760,"width":135,"height":11}},{"id":"faf115dd-ce52-487c-a847-41edde510773","block_type":"box","text":"To the extent that the Fund engages in securities lending, the Fund conducts its securities lending pursuant to an","page_number":26,"box":{"x":101,"y":783,"width":807,"height":11}},{"id":"4f904e7a-d54f-4a65-93fd-cb1156c73f46","block_type":"box","text":"exemptive order from the Commission permitting it to lend por tfolio securities to borrowers affiliated with the Fund","page_number":26,"box":{"x":69,"y":798,"width":817,"height":11}},{"id":"63f9b6b4-9811-4e27-b44c-48aea79fc177","block_type":"box","text":"and to retain an affiliate of the Fund as securities lending agent. To the extent that the Fund engages in securities","page_number":26,"box":{"x":69,"y":813,"width":813,"height":11}},{"id":"fac970a7-4a43-40d2-b0e6-9b6b7b9833b4","block_type":"box","text":"lending, BlackRock Investment Management, LLC (“BIM”) acts as securities lending agent for the Fund, subject to the","page_number":26,"box":{"x":70,"y":828,"width":838,"height":12}},{"id":"fa16d1ec-2bfe-4294-af96-c528353dc096","block_type":"box","text":"overall supervision of the Manager, pursuant to a written agreement (the “Securities Lending Agency Agreement”).","page_number":26,"box":{"x":69,"y":843,"width":813,"height":12}},{"id":"5156899a-166e-4f56-970e-fdd0f630c43d","block_type":"box","text":"BIM administers the lending program in accordance with guidelines approved by the Board.","page_number":26,"box":{"x":70,"y":859,"width":646,"height":11}},{"id":"2bba0782-7b68-4618-9cdc-71cd20c58c4d","block_type":"box","text":"The Fund retains a por tion of the securities lending income and remits the remaining por tion to BIM as","page_number":26,"box":{"x":101,"y":881,"width":735,"height":11}},{"id":"928c3d8e-34a6-47c4-9340-5f92116d7e56","block_type":"box","text":"compensation for its services as securities lending agent. Securities lending income is generally equal to the total of","page_number":26,"box":{"x":69,"y":896,"width":834,"height":12}},{"id":"baf4f97b-19fe-454f-bc84-7f020859b07e","block_type":"box","text":"income earned from the reinvestment of cash collateral (and excludes collateral investment fees as defined below),","page_number":26,"box":{"x":70,"y":911,"width":822,"height":11}},{"id":"52caa884-cfa5-4b59-a0db-414df9ca47ea","block_type":"box","text":"I-24","page_number":26,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"11017f4a-3031-4562-9189-a6d5ae29a053","block_type":"box","text":"NM1026U-5982568-26/232","page_number":26,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"069dc143-941f-474a-8d3d-d6c361eeb950","block_type":"box","text":"and any fees or other payments to and from borrowers of securities. As securities lending agent, BIM bears all","page_number":27,"box":{"x":69,"y":45,"width":787,"height":11}},{"id":"75ffc658-e4df-48e4-99e0-d3828adf7f35","block_type":"box","text":"operational costs directly related to securities lending. The Fund is responsible for fees in connection with the","page_number":27,"box":{"x":69,"y":60,"width":783,"height":11}},{"id":"ceb29376-6f6f-422f-8d0e-c6d83d2bc2fe","block_type":"box","text":"investment of cash collateral received for securities on loan in a money market fund managed by BlackRock (the","page_number":27,"box":{"x":70,"y":75,"width":800,"height":11}},{"id":"ef137e0d-ca10-42ac-a0fb-ec071a0f785d","block_type":"box","text":"“collateral investment fees”); however, the securities lending agent has agreed to reduce the amount of securities","page_number":27,"box":{"x":70,"y":90,"width":813,"height":11}},{"id":"bec3d92f-3ec8-4c99-a15c-9a57c295c90f","block_type":"box","text":"lending income it receives in order to effectively limit the collateral investment fees the Fund bears to an annual rate","page_number":27,"box":{"x":70,"y":105,"width":830,"height":11}},{"id":"94d1a295-867e-4bd1-b066-c3d13c5884ee","block_type":"box","text":"of 0.04%. Such money market fund shares will not be subject to a sales load, distribution fee or service fee.","page_number":27,"box":{"x":69,"y":120,"width":773,"height":11}},{"id":"f724f57a-6fab-4380-8a74-2739675c3a65","block_type":"box","text":"To the extent that the Fund invests cash collateral in a non-government money market fund, the Fund may be","page_number":27,"box":{"x":101,"y":143,"width":776,"height":11}},{"id":"e5479bad-21f2-4934-852e-a9e29c8d26f3","block_type":"box","text":"subject to a discretionary liquidity fee of up to 2% on all redemptions. Discretionary liquidity fees may be imposed or","page_number":27,"box":{"x":69,"y":158,"width":831,"height":11}},{"id":"4be2629f-d247-45ee-8269-a333c3a991a5","block_type":"box","text":"terminated at any time at the discretion of the board of directors of the money market fund, or its delegate, if it is","page_number":27,"box":{"x":68,"y":173,"width":812,"height":11}},{"id":"d3ff57da-0512-49a2-96c7-34cfca926ecd","block_type":"box","text":"determined that such fee would be, or would not be, respectively, in the best interest of the money market fund.","page_number":27,"box":{"x":69,"y":188,"width":799,"height":11}},{"id":"1fb97986-27c6-494e-92cb-3512743daeb8","block_type":"box","text":"Additionally, the Fund will be subject to a mandatory liquidity fee if the money market fund’s total net redemptions on","page_number":27,"box":{"x":68,"y":203,"width":835,"height":12}},{"id":"4680602b-e607-4863-9502-9786b9394860","block_type":"box","text":"a single day exceed 5% of the money market fund’s net assets, unless the liquidity costs are de minimis (i.e., less","page_number":27,"box":{"x":69,"y":218,"width":818,"height":12}},{"id":"97d355ac-bad3-420c-8274-d168ee42ec17","block_type":"box","text":"than one basis point (0.01%)). The money market fund will determine the size of the mandatory liquidity fee by","page_number":27,"box":{"x":68,"y":234,"width":789,"height":11}},{"id":"1c203ea9-d9a8-42c8-ab41-b4e33744a68f","block_type":"box","text":"making a good faith estimate of cer tain costs the money market fund would incur if it were to sell a pro rata amount","page_number":27,"box":{"x":69,"y":249,"width":829,"height":11}},{"id":"26579f0d-fd91-44d5-87ca-5d05d2848f0a","block_type":"box","text":"of each security in the por tfolio to satisfy the amount of net redemptions on that day. There is no limit to the size of a","page_number":27,"box":{"x":69,"y":264,"width":839,"height":11}},{"id":"14932bf9-c2bd-4d66-9a0a-23c9b535d14e","block_type":"box","text":"mandatory liquidity fee. If the money market fund cannot estimate the costs of selling a pro rata amount of each","page_number":27,"box":{"x":69,"y":279,"width":802,"height":11}},{"id":"1d28bbb6-71c2-4fe5-aa31-8475a6a0a499","block_type":"box","text":"por tfolio security in good faith and suppor ted by data, it is required to apply a default liquidity fee of 1% on the value","page_number":27,"box":{"x":70,"y":294,"width":830,"height":11}},{"id":"9f615ec9-bc32-4462-b743-2cdb3e6029f5","block_type":"box","text":"of shares redeemed on that day. The imposition of any such discretionary or mandatory liquidity fee would reduce the","page_number":27,"box":{"x":69,"y":309,"width":838,"height":11}},{"id":"e2404100-4723-400b-8019-529f5f369323","block_type":"box","text":"Fund’s returns on securities lending.","page_number":27,"box":{"x":70,"y":325,"width":258,"height":11}},{"id":"31e13b90-54d4-428c-81a4-639a53d8004b","block_type":"box","text":"Under the securities lending program, the Fund is categorized into one of several specific asset classes. The","page_number":27,"box":{"x":102,"y":347,"width":774,"height":11}},{"id":"23e2bb0b-d2c1-494f-a258-d257f274d2a9","block_type":"box","text":"determination of the Fund’s asset class category (fixed-income, domestic equity, international equity, or fund of","page_number":27,"box":{"x":69,"y":362,"width":794,"height":11}},{"id":"67e9953c-0d63-4961-a712-bab1c715d994","block_type":"box","text":"funds), each of which may be subject to a different fee arrangement, is based on a methodology agreed to by the","page_number":27,"box":{"x":68,"y":377,"width":809,"height":12}},{"id":"53ab69d8-839a-4bc8-87db-11946a11d542","block_type":"box","text":"Trust and BIM.","page_number":27,"box":{"x":68,"y":393,"width":103,"height":8}},{"id":"d4bc4e9d-74bd-444e-abcf-0f4bac5593dd","block_type":"box","text":"Pursuant to the securities lending agreement effective January 1, 2026: (i) the Fund retains 81% of securities","page_number":27,"box":{"x":102,"y":415,"width":783,"height":11}},{"id":"3713e0f6-8a4d-4ed6-8367-cd401618d94a","block_type":"box","text":"lending income (which excludes collateral investment fees); and (ii) this amount can never be less than 70% of the","page_number":27,"box":{"x":70,"y":430,"width":815,"height":11}},{"id":"3fef5dc2-180f-47a8-805c-b114b697e11f","block_type":"box","text":"sum of securities lending income plus collateral investment fees.","page_number":27,"box":{"x":69,"y":445,"width":463,"height":12}},{"id":"493e5c5e-5c05-47d1-a47b-066e6fe9276c","block_type":"box","text":"In addition, commencing the business day following the date that the aggregate securities lending income","page_number":27,"box":{"x":102,"y":468,"width":753,"height":11}},{"id":"022ebebc-f010-464a-86cb-b4293f0679c0","block_type":"box","text":"earned across the BlackRock Multi-Asset Complex in a calendar year exceeds specified thresholds, the Fund,","page_number":27,"box":{"x":69,"y":483,"width":778,"height":11}},{"id":"abc4215c-6488-4600-af37-2c94ac8dc5f1","block_type":"box","text":"pursuant to the current securities lending agreement, will receive for the remainder of that calendar year securities","page_number":27,"box":{"x":70,"y":498,"width":817,"height":11}},{"id":"cc49ce7d-adee-47a2-b00c-5279fda08283","block_type":"box","text":"lending income as follows: (i) 84% of securities lending income (which excludes collateral investment fees); and","page_number":27,"box":{"x":70,"y":513,"width":794,"height":12}},{"id":"d90f512a-1836-4093-b81d-9851abe60a3e","block_type":"box","text":"(ii) this amount can never be less than 70% of the sum of securities lending income plus collateral investment fees.","page_number":27,"box":{"x":69,"y":528,"width":825,"height":12}},{"id":"eea4b23d-d86e-476f-9bb9-b65211d31083","block_type":"box","text":"Prior to January 1, 2026, the Fund was subject to the same securities lending fee arrangement.","page_number":27,"box":{"x":102,"y":551,"width":683,"height":11}},{"id":"02e68dde-41c0-4f89-b566-47d3cbbe9487","block_type":"box","text":"The services provided to the Fund by BIM, in the most recent fiscal year ended May 31, 2026, primarily included","page_number":27,"box":{"x":101,"y":574,"width":803,"height":11}},{"id":"156d5017-8753-465b-9ea7-6007dd1e5f8c","block_type":"box","text":"the following:","page_number":27,"box":{"x":68,"y":589,"width":93,"height":11}},{"id":"17416a06-1e61-4b78-b248-28b638a35b9d","block_type":"box","text":"(1) selecting borrowers from an approved list of borrowers and executing a securities lending agreement as agent","page_number":27,"box":{"x":69,"y":609,"width":818,"height":11}},{"id":"208f435e-96c9-4f5a-a9b2-ba3875affee3","block_type":"box","text":"on behalf of the Fund with each such borrower;","page_number":27,"box":{"x":102,"y":624,"width":333,"height":11}},{"id":"1cef8f89-0b36-4234-b42a-a409b521b11e","block_type":"box","text":"(2) negotiating the terms of securities loans, including the amount of fees;","page_number":27,"box":{"x":69,"y":644,"width":538,"height":12}},{"id":"3ffef78e-0f26-491d-8a4d-dea07aea97e6","block_type":"box","text":"(3) directing the delivery of loaned securities;","page_number":27,"box":{"x":69,"y":664,"width":330,"height":12}},{"id":"b806cc5a-046a-4259-b9e7-5799b54b9118","block_type":"box","text":"(4) monitoring the daily value of the loaned securities and directing the payment of additional collateral or the return","page_number":27,"box":{"x":69,"y":685,"width":834,"height":11}},{"id":"8ce5425c-9c05-4255-829c-ad27aa670a18","block_type":"box","text":"of excess collateral, as necessary;","page_number":27,"box":{"x":102,"y":700,"width":246,"height":11}},{"id":"5ed225b9-0e4f-40a6-b7ef-b1c64d850ec1","block_type":"box","text":"(5) investing cash collateral received in connection with any loaned securities;","page_number":27,"box":{"x":69,"y":720,"width":562,"height":11}},{"id":"9e94734c-4a30-4182-b118-ba9d899df7e3","block_type":"box","text":"(6) monitoring distributions on loaned securities (for example, interest and dividend activity);","page_number":27,"box":{"x":69,"y":740,"width":665,"height":11}},{"id":"6d659c70-0367-4aa9-981c-a75c7561c883","block_type":"box","text":"(7) in the event of default by a borrower with respect to any securities loan, using the collateral or the proceeds of","page_number":27,"box":{"x":69,"y":760,"width":822,"height":12}},{"id":"ba4357c4-675c-45a2-ba79-ec93232c2c5b","block_type":"box","text":"the liquidation of collateral to purchase replacement securities of the same issue, type, class and series as that","page_number":27,"box":{"x":101,"y":775,"width":803,"height":11}},{"id":"3bf66604-285b-4a1c-981f-18600920dc1b","block_type":"box","text":"of the loaned securities; and","page_number":27,"box":{"x":102,"y":790,"width":203,"height":11}},{"id":"4336b395-5f99-450c-a588-1d7c9d5e677f","block_type":"box","text":"(8) terminating securities loans and arranging for the return of loaned securities to the Fund at loan termination.","page_number":27,"box":{"x":69,"y":811,"width":808,"height":11}},{"id":"8622accf-3c70-4f24-a4df-84c901d22dce","block_type":"box","text":"I-25","page_number":27,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"987cdd3f-4346-4a44-a837-e82abda28442","block_type":"box","text":"NM1026U-5982568-27/232","page_number":27,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"d6b49702-2ecb-4a3c-94ff-d9fca6c46689","block_type":"box","text":"The following table shows the dollar amounts of income and fees/compensation related to the securities lending","page_number":28,"box":{"x":101,"y":45,"width":805,"height":11}},{"id":"30e531e5-abc3-46fa-949b-e0be7b37fa9e","block_type":"box","text":"activities of the Fund during its most recent fiscal year ended May 31, 2026.","page_number":28,"box":{"x":69,"y":60,"width":546,"height":11}},{"id":"cc0f71ab-b0ac-4262-8086-9529c9cea329","block_type":"box","text":"Gross income from securities lending activities","page_number":28,"box":{"x":69,"y":88,"width":343,"height":11}},{"id":"4e1db2da-29bf-44f4-b51d-65a5cced6cd1","block_type":"box","text":"................................................","page_number":28,"box":{"x":416,"y":95,"width":385,"height":1}},{"id":"550431a8-2b5e-4400-b831-350282d4fa92","block_type":"box","text":"$2,738,932","page_number":28,"box":{"x":822,"y":87,"width":87,"height":11}},{"id":"cc1dddb7-9144-4570-a777-f949c8760e83","block_type":"box","text":"Fees and/or compensation for securities lending activities and related services","page_number":28,"box":{"x":70,"y":107,"width":565,"height":11}},{"id":"1b7298b7-a4ad-4c75-80ba-bb76aa767835","block_type":"box","text":"Securities lending income paid to BIM for services as securities lending agent . . . . .","page_number":28,"box":{"x":79,"y":122,"width":599,"height":11}},{"id":"57915d9c-28c7-43ee-a7c2-638416f95842","block_type":"box","text":"............... $","page_number":28,"box":{"x":685,"y":121,"width":145,"height":11}},{"id":"2a5e36ce-486f-40b8-a6e7-f0ad4a44f772","block_type":"box","text":"290,707","page_number":28,"box":{"x":847,"y":122,"width":61,"height":11}},{"id":"2439372b-0b69-419b-bfd8-538cd9016773","block_type":"box","text":"Cash collateral management expenses not included in securities lending income paid to BIM . .","page_number":28,"box":{"x":79,"y":137,"width":673,"height":12}},{"id":"bb19b3bd-7ee8-4883-a783-cbbaf14dddc1","block_type":"box","text":". . . . . . $ 18,392","page_number":28,"box":{"x":758,"y":137,"width":151,"height":11}},{"id":"a664b7bf-e9b5-4811-9d24-048e54e5aad2","block_type":"box","text":"Administrative fees not included in securities lending income paid to BIM . . . .","page_number":28,"box":{"x":78,"y":152,"width":551,"height":12}},{"id":"ef27b448-71e5-4680-8d6d-709ecf4635d0","block_type":"box","text":"..................... $ 0","page_number":28,"box":{"x":636,"y":152,"width":273,"height":10}},{"id":"ddf99041-8d02-4f3a-9444-3c77b9006f73","block_type":"box","text":"Indemnification fees not included in securities lending income paid to BIM . . . . .","page_number":28,"box":{"x":79,"y":167,"width":567,"height":12}},{"id":"29d44f81-92e5-432b-9ca9-a670d6d84b87","block_type":"box","text":"................... $ 0","page_number":28,"box":{"x":652,"y":167,"width":257,"height":10}},{"id":"b1b3e457-05c2-499b-b4ea-7ca0fa89df3e","block_type":"box","text":"Rebates (paid to borrowers) . . . . . . . . . . .","page_number":28,"box":{"x":79,"y":183,"width":289,"height":11}},{"id":"47955afa-d011-48f4-9cbe-bd4c99f0bdae","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,","page_number":28,"box":{"x":375,"y":182,"width":470,"height":11}},{"id":"4c49960c-24c0-4deb-b2eb-8fda6c49d43a","block_type":"box","text":"179,770","page_number":28,"box":{"x":847,"y":183,"width":62,"height":10}},{"id":"3846b873-8d67-4770-ac1b-fa7918ea8d21","block_type":"box","text":"Other fees not included in securities lending income paid to BIM. . . . . . . . . . .","page_number":28,"box":{"x":79,"y":198,"width":542,"height":11}},{"id":"258d866d-d412-41d6-b525-ad37c1ca5638","block_type":"box","text":"...................... $ 0","page_number":28,"box":{"x":628,"y":197,"width":281,"height":11}},{"id":"e8896816-7a82-4a92-beda-599bf0c3b2dd","block_type":"box","text":"Aggregate fees/compensation for securities lending activities","page_number":28,"box":{"x":68,"y":213,"width":455,"height":11}},{"id":"7af839c2-390a-44c8-8c93-a44f54420962","block_type":"box","text":"..................................","page_number":28,"box":{"x":530,"y":220,"width":271,"height":2}},{"id":"9c4dd8a0-9c5c-46c9-bc1b-9418a72cf5b1","block_type":"box","text":"$1,488,869","page_number":28,"box":{"x":822,"y":212,"width":87,"height":12}},{"id":"df3e091e-1f36-491b-8822-f624da4c488a","block_type":"box","text":"Net income from securities lending activities","page_number":28,"box":{"x":69,"y":232,"width":327,"height":11}},{"id":"e72f056d-f140-471d-bee4-cb4e8b278f4a","block_type":"box","text":"..................................................","page_number":28,"box":{"x":399,"y":240,"width":402,"height":1}},{"id":"0cb9eb23-5aa3-4f7e-b71d-caf8c63eb3a6","block_type":"box","text":"$1,250,063","page_number":28,"box":{"x":822,"y":232,"width":87,"height":11}},{"id":"32bac354-9ec0-4ac6-84fc-c3ec60c45caf","block_type":"box","text":"VIII. 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Please see below for the per formance of MSCI All","page_number":28,"box":{"x":69,"y":427,"width":794,"height":11}},{"id":"7ed6004a-d53c-4b2e-94c9-b2e82be79562","block_type":"box","text":"Country World Index, MSCI All-Country World Information Technology 10/40 Index and MSCI All-Country World","page_number":28,"box":{"x":69,"y":442,"width":777,"height":11}},{"id":"0ff59f8e-d781-4f93-8bcb-46d18ded5b58","block_type":"box","text":"Information Technology Index that do not reflect the deduction of such maximum withholding taxes for the period","page_number":28,"box":{"x":70,"y":457,"width":799,"height":12}},{"id":"fa685e4c-1c52-4a7a-9fdf-2083643b7e3c","block_type":"box","text":"noted below:","page_number":28,"box":{"x":69,"y":473,"width":89,"height":8}},{"id":"fff1d535-d4d7-4a73-83f1-8fe05314964c","block_type":"box","text":"For the periods ended 12/31/25","page_number":28,"box":{"x":69,"y":501,"width":193,"height":8}},{"id":"b07f5d55-5a3c-4d12-a625-096e62569377","block_type":"box","text":"Average Annual Total Returns","page_number":28,"box":{"x":68,"y":511,"width":173,"height":9}},{"id":"1c69b5ee-714a-47fe-a87c-305534ab74aa","block_type":"box","text":"1 Year 5 Years 10 Years","page_number":28,"box":{"x":716,"y":511,"width":193,"height":7}},{"id":"a812e3be-1483-4d8a-8afc-c14a6beb6107","block_type":"box","text":"MSCI All Country World Index","page_number":28,"box":{"x":70,"y":529,"width":205,"height":11}},{"id":"d7e95bfe-31b8-4feb-9439-f70933cb3690","block_type":"box","text":"(Reflects no deduction for fees, expenses or taxes) . . . . . . . .","page_number":28,"box":{"x":79,"y":543,"width":431,"height":11}},{"id":"63a54a97-6eec-4a81-8ac0-e41e8952dd71","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . 22.87% 11.70% 12.28%","page_number":28,"box":{"x":516,"y":543,"width":401,"height":9}},{"id":"5b33f7dd-565a-4c6b-805e-e2cc34b91c50","block_type":"box","text":"MSCI All-Country World Information Technology 10/40 Index","page_number":28,"box":{"x":70,"y":558,"width":425,"height":11}},{"id":"fc85e636-66c2-4a42-8e29-480583c12e9a","block_type":"box","text":"(Reflects no deduction for fees, expenses or taxes) . . . . . . . .","page_number":28,"box":{"x":79,"y":572,"width":431,"height":12}},{"id":"39a45720-6bb5-4162-934b-d19b6b21ae5e","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . 30.46% N/A N/A","page_number":28,"box":{"x":516,"y":573,"width":382,"height":11}},{"id":"095d58db-c8cf-49c7-80c7-40612774e8d8","block_type":"box","text":"MSCI All-Country World Information Technology Index","page_number":28,"box":{"x":70,"y":588,"width":373,"height":11}},{"id":"46fffd8f-eb61-4418-ade6-31003056f201","block_type":"box","text":"(Reflects no deduction for fees, expenses or taxes) . . . . . . . .","page_number":28,"box":{"x":79,"y":602,"width":431,"height":11}},{"id":"7e18e062-f450-41e8-ac9e-d6d6de80ccf6","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . 26.62% 17.43% 21.98%","page_number":28,"box":{"x":516,"y":602,"width":401,"height":9}},{"id":"d043cc54-7026-4fa1-8a89-0636a4afbd57","block_type":"box","text":"The Trust","page_number":28,"box":{"x":68,"y":634,"width":69,"height":9}},{"id":"16c8e607-65eb-4629-8799-72571203dd5b","block_type":"box","text":"The Trust was organized as a Massachusetts business trust on December 22, 1988, and is registered under the","page_number":28,"box":{"x":101,"y":656,"width":807,"height":12}},{"id":"ab928720-9fd4-40d8-a4d6-0bf802e2b607","block_type":"box","text":"Investment Company Act as an open-end management investment company. 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Financial Statements","page_number":31,"box":{"x":69,"y":45,"width":179,"height":9}},{"id":"72a0c12f-9e51-4348-903a-868a9d2d708f","block_type":"box","text":"The audited financial statements, financial highlights and notes thereto in the Fund’s Annual Financial","page_number":31,"box":{"x":101,"y":67,"width":726,"height":12}},{"id":"322e7312-1323-4c0c-96eb-45685e219453","block_type":"box","text":"Statements and Additional Information for the fiscal year ended May 31, 2026, as filed with the SEC on Form N-CSR","page_number":31,"box":{"x":69,"y":82,"width":829,"height":12}},{"id":"a60a6c58-ca0f-4e17-9908-fbada1d9900b","block_type":"box","text":"(the “2026 Annual Financial Statements”), are incorporated in this SAI by reference. No other par ts of the 2026","page_number":31,"box":{"x":69,"y":98,"width":800,"height":11}},{"id":"ba8df813-9a6a-4a2f-b970-819e43f8405b","block_type":"box","text":"Annual Financial Statements are incorporated by reference herein. The 2026 Annual Financial Statements have been","page_number":31,"box":{"x":68,"y":113,"width":833,"height":11}},{"id":"7c91fb39-bda1-4971-a29c-507bf5dd2062","block_type":"box","text":"audited by Deloitte & Touche LLP. The repor t of Deloitte & Touche LLP is incorporated herein by reference. Such 2026","page_number":31,"box":{"x":69,"y":128,"width":839,"height":11}},{"id":"e842be70-723b-4d37-89d4-82b146e6fceb","block_type":"box","text":"Annual Financial Statements have been incorporated herein in reliance upon the repor t of such firm given their","page_number":31,"box":{"x":68,"y":143,"width":790,"height":11}},{"id":"174707d3-e542-4d70-a430-a7f7eaf64f27","block_type":"box","text":"authority as exper ts in accounting and auditing. Additional copies of the Fund’s annual and semi-annual repor ts to","page_number":31,"box":{"x":69,"y":158,"width":815,"height":11}},{"id":"442e6f35-d5ab-457e-9240-2d584fab92ef","block_type":"box","text":"shareholders and the Fund’s Annual and Semi-Annual Financial Statements and Additional Information may be","page_number":31,"box":{"x":69,"y":173,"width":785,"height":11}},{"id":"8724d76f-e944-4f94-9db2-ecc984f23b49","block_type":"box","text":"obtained at no charge by telephoning the Distributor at the telephone number appearing on the front page of this SAI.","page_number":31,"box":{"x":69,"y":188,"width":836,"height":12}},{"id":"d9a3053f-6af9-48ca-86c6-b780d954b315","block_type":"box","text":"I-29","page_number":31,"box":{"x":476,"y":943,"width":26,"height":9}},{"id":"9ecc6a4a-6244-4b38-964d-9f2fbd8436aa","block_type":"box","text":"NM1026U-5982568-31/232","page_number":31,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"1122c194-1c72-47d4-ae87-68359fa4f38e","block_type":"box","text":"PART II","page_number":32,"box":{"x":463,"y":45,"width":52,"height":9}},{"id":"4ad0f571-cacc-491a-9ce7-4c145b82f0b7","block_type":"box","text":"Throughout this Statement of Additional Information (“SAI”), each BlackRock-advised fund may be referred to as","page_number":32,"box":{"x":101,"y":67,"width":799,"height":12}},{"id":"0e713a09-548e-42b7-9be5-3a33f5529eb5","block_type":"box","text":"a “Fund” or collectively with others as the “Funds.” Cer tain Funds may also be referred to as “Municipal Funds” if","page_number":32,"box":{"x":69,"y":82,"width":813,"height":12}},{"id":"84ce8284-bcf0-43de-8200-52125950625a","block_type":"box","text":"they invest cer tain of their assets in municipal investments described below.","page_number":32,"box":{"x":68,"y":98,"width":546,"height":11}},{"id":"344060e1-a58f-4189-aae2-2c196d0ee7cd","block_type":"box","text":"Each Fund is organized either as a Maryland corporation, a Massachusetts business trust or a Delaware","page_number":32,"box":{"x":102,"y":120,"width":745,"height":12}},{"id":"66742e2c-c277-447d-9a0f-eab1cf37de57","block_type":"box","text":"statutory trust. In each jurisdiction, nomenclature varies. For ease and clarity of presentation, shares of common","page_number":32,"box":{"x":69,"y":135,"width":805,"height":11}},{"id":"f2f72cf6-4d73-42aa-93ce-627b8e25878d","block_type":"box","text":"stock and shares of beneficial interest are referred to herein as “shares” or “Common Stock,” holders of shares of","page_number":32,"box":{"x":69,"y":150,"width":824,"height":11}},{"id":"3507b096-97a4-4e0c-a507-e8aa6624c21c","block_type":"box","text":"Common Stock are referred to as “shareholders,” the trustees or directors of each Fund are referred to as","page_number":32,"box":{"x":69,"y":166,"width":761,"height":10}},{"id":"43b846c7-44ba-4c45-ae17-fd3777d1a461","block_type":"box","text":"“Directors,” the boards of trustees/directors of each Fund are referred to as the “Board of Directors” or the “Board,”","page_number":32,"box":{"x":70,"y":181,"width":835,"height":11}},{"id":"e67ed688-e672-4cb8-8194-9716e9cf5f6e","block_type":"box","text":"BlackRock Advisors, LLC, BlackRock Fund Advisors or their respective affiliates is the investment adviser or manager","page_number":32,"box":{"x":70,"y":196,"width":832,"height":11}},{"id":"a7721053-f95a-4498-b971-44ba3a5e5fb7","block_type":"box","text":"of each Fund and is referred to herein as the “Manager” or “BlackRock,” and the investment advisory agreement or","page_number":32,"box":{"x":69,"y":211,"width":826,"height":11}},{"id":"8fd6c7ce-e287-487c-a107-aa305638b435","block_type":"box","text":"management agreement applicable to each Fund is referred to as the “Management Agreement.” Each Fund’s","page_number":32,"box":{"x":69,"y":226,"width":786,"height":11}},{"id":"3814cc5a-908c-4f32-aedc-6bc4c3865cd5","block_type":"box","text":"Ar ticles of Incorporation or Declaration of Trust, together with all amendments thereto, is referred to as its “char ter.”","page_number":32,"box":{"x":68,"y":241,"width":834,"height":11}},{"id":"23a0c9a4-ad1b-4f3a-8291-a492e06798d6","block_type":"box","text":"The Investment Company Act of 1940, as amended, is referred to herein as the “Investment Company Act.” The","page_number":32,"box":{"x":68,"y":256,"width":801,"height":11}},{"id":"8e173caf-bd19-4e90-809e-94d3b86eabf4","block_type":"box","text":"Securities Act of 1933, as amended, is referred to herein as the “Securities Act.” The Securities and Exchange","page_number":32,"box":{"x":69,"y":271,"width":793,"height":12}},{"id":"bd887f66-24a2-4d1c-bc70-e73df4325829","block_type":"box","text":"Commission is referred to herein as the “Commission” or the “SEC.”","page_number":32,"box":{"x":69,"y":286,"width":492,"height":10}},{"id":"56f54f34-6f46-4ff9-b325-288c2bc8a16f","block_type":"box","text":"Cer tain Funds are “feeder” funds (each, a “Feeder Fund”) that invest all or a por tion of their assets in a","page_number":32,"box":{"x":102,"y":309,"width":741,"height":11}},{"id":"ce68e007-3d30-4531-9a78-b9e510215009","block_type":"box","text":"corresponding “master” por tfolio (each, a “Master Por tfolio”) of a master limited liability company (each, a “Master","page_number":32,"box":{"x":69,"y":324,"width":824,"height":12}},{"id":"545becf5-5d19-45b0-9b28-ef122872b7d0","block_type":"box","text":"LLC”), a mutual fund that has the same objective and strategies as the Feeder Fund. All investments are generally","page_number":32,"box":{"x":70,"y":339,"width":814,"height":12}},{"id":"a08de50b-f448-49bc-afa2-e988c73989cb","block_type":"box","text":"made at the level of the Master Por tfolio. This structure is sometimes called a “master/feeder” structure. A Feeder","page_number":32,"box":{"x":69,"y":355,"width":825,"height":11}},{"id":"6417a9c6-98ca-4e24-b7e1-ddef32b30b8c","block_type":"box","text":"Fund’s investment results will correspond directly to the investment results of the underlying Master Por tfolio in","page_number":32,"box":{"x":70,"y":370,"width":795,"height":11}},{"id":"2bf1bfe6-52ca-4987-b73d-b9cc63cd2699","block_type":"box","text":"which it invests. For simplicity, this SAI uses the term “Fund” to include both a Feeder Fund and its Master Por tfolio.","page_number":32,"box":{"x":68,"y":385,"width":830,"height":11}},{"id":"d0e456c9-aa7f-419b-8653-50c435a609ca","block_type":"box","text":"In addition to containing information about the Funds, Par t II of this SAI contains general information about all","page_number":32,"box":{"x":102,"y":407,"width":783,"height":12}},{"id":"722260c6-ad28-4e9e-9d90-34ade1757793","block_type":"box","text":"funds in the BlackRock-advised fund complex. Cer tain information contained herein may not be relevant to a","page_number":32,"box":{"x":68,"y":423,"width":772,"height":11}},{"id":"0848a8e7-34ac-47ac-80b0-d90adf56352f","block_type":"box","text":"par ticular Fund.","page_number":32,"box":{"x":70,"y":438,"width":109,"height":11}},{"id":"0de33253-2ece-4bad-9637-e55d5d4b2b4b","block_type":"box","text":"INVESTMENT RISKS AND CONSIDERATIONS","page_number":32,"box":{"x":314,"y":467,"width":351,"height":10}},{"id":"dd0a828a-c7e0-40d9-a015-f633b38c5c41","block_type":"box","text":"Set for th below are descriptions of some of the types of investments and investment strategies that one or more","page_number":32,"box":{"x":102,"y":490,"width":805,"height":11}},{"id":"5b731833-ea47-4189-aafb-67dbd08d46a6","block_type":"box","text":"of the Funds may use, and the risks and considerations associated with those investments and investment","page_number":32,"box":{"x":69,"y":505,"width":765,"height":11}},{"id":"be99d914-51a4-4c17-8c3e-eaabdead4ed8","block_type":"box","text":"strategies. Please see each Fund’s prospectuses (the “Prospectus”) and the “Investment Objective and Policies,”","page_number":32,"box":{"x":69,"y":520,"width":811,"height":12}},{"id":"8da20cd0-b2de-4503-b2ad-990cafe1d5e5","block_type":"box","text":"“Investment Objectives and Policies” or “Investment Strategies and Risks of the Fund” section, as applicable, of Par t","page_number":32,"box":{"x":70,"y":535,"width":837,"height":12}},{"id":"a94ad817-6221-41c5-bfd7-702678963b35","block_type":"box","text":"I of this SAI for fur ther information on each Fund’s investment policies and risks. Information contained in this","page_number":32,"box":{"x":70,"y":550,"width":785,"height":11}},{"id":"8b3dde40-4bed-4d1a-8da1-dc19ea2e256b","block_type":"box","text":"section about the risks and considerations associated with a Fund’s investments and/or investment strategies","page_number":32,"box":{"x":69,"y":566,"width":791,"height":11}},{"id":"49e4ae54-15a6-407f-bf40-9e6fe0e46491","block_type":"box","text":"applies only to those Funds specifically identified in Par t I of this SAI as making each type of investment or using","page_number":32,"box":{"x":69,"y":581,"width":805,"height":11}},{"id":"66490bf5-879c-48cf-85d5-2eaf9baf46dd","block_type":"box","text":"each investment strategy (each, a “Covered Fund”). Information that does not apply to a Covered Fund does not form","page_number":32,"box":{"x":69,"y":596,"width":835,"height":11}},{"id":"4ef13a90-5849-4c2d-98c1-d906ad08230f","block_type":"box","text":"a par t of that Covered Fund’s SAI and should not be relied on by investors in that Covered Fund. Only information that","page_number":32,"box":{"x":69,"y":611,"width":840,"height":11}},{"id":"17ca5fba-c5ab-4d9a-9e85-f3782a70cc2d","block_type":"box","text":"is clearly identified as applicable to a Covered Fund is considered to form a par t of that Covered Fund’s SAI.","page_number":32,"box":{"x":70,"y":626,"width":770,"height":11}},{"id":"c0809361-8982-4239-a54e-d580112580cb","block_type":"box","text":"Asset-Backed Securities.","page_number":32,"box":{"x":101,"y":649,"width":183,"height":9}},{"id":"d39e05c5-25e2-4181-a1d2-75cc65c8aa08","block_type":"box","text":"Asset-backed securities are securities backed by home equity loans, installment sale","page_number":32,"box":{"x":290,"y":649,"width":607,"height":11}},{"id":"6ccc04e6-d78b-4ddf-a650-fbb6e1da1d41","block_type":"box","text":"contracts, credit card receivables or other assets. Asset-backed securities are “pass-through” securities, meaning","page_number":32,"box":{"x":69,"y":664,"width":814,"height":11}},{"id":"cabbdf51-0d3c-4f74-8030-4e3286d84192","block_type":"box","text":"that principal and interest payments — net of expenses — made by the borrower on the underlying assets (such as","page_number":32,"box":{"x":68,"y":679,"width":825,"height":11}},{"id":"39a11fc7-8dd5-46d9-ab6a-4c613720020a","block_type":"box","text":"credit card receivables) are passed through to a Fund. The value of asset-backed securities, like that of traditional","page_number":32,"box":{"x":69,"y":694,"width":813,"height":11}},{"id":"83e2d5f3-1ff5-4ac0-87c9-6f5d78b7adc2","block_type":"box","text":"fixed-income securities, typically increases when interest rates fall and decreases when interest rates rise. However,","page_number":32,"box":{"x":68,"y":709,"width":830,"height":11}},{"id":"95cc66ac-322d-44d6-b960-cbd348172bf8","block_type":"box","text":"asset-backed securities differ from traditional fixed-income securities because of their potential for prepayment. The","page_number":32,"box":{"x":69,"y":724,"width":827,"height":11}},{"id":"3bc5d743-0e04-4fa5-909a-614ba7895b16","block_type":"box","text":"price paid by a Fund for its asset-backed securities, the yield the Fund expects to receive from such securities and","page_number":32,"box":{"x":70,"y":739,"width":813,"height":12}},{"id":"82d973e2-b459-437d-a0bb-de7b531723ce","block_type":"box","text":"the average life of the securities are based on a number of factors, including the anticipated rate of prepayment of","page_number":32,"box":{"x":68,"y":755,"width":818,"height":11}},{"id":"9070834a-03d6-4d43-87b0-269e8d46730b","block_type":"box","text":"the underlying assets. In a period of declining interest rates, borrowers may prepay the underlying assets more","page_number":32,"box":{"x":68,"y":770,"width":792,"height":11}},{"id":"a6a8d6a6-303a-4619-ac9e-c38bc3bf0dac","block_type":"box","text":"quickly than anticipated, thereby reducing the yield to maturity and the average life of the asset-backed securities.","page_number":32,"box":{"x":69,"y":785,"width":811,"height":11}},{"id":"e87755b5-bba7-46bf-8e01-427df52d5316","block_type":"box","text":"Moreover, when a Fund reinvests the proceeds of a prepayment in these circumstances, it will likely receive a rate of","page_number":32,"box":{"x":70,"y":800,"width":832,"height":11}},{"id":"7e5f60b7-4d4e-47fc-b071-66eee0692326","block_type":"box","text":"interest that is lower than the rate on the security that was prepaid. To the extent that a Fund purchases asset","page_number":32,"box":{"x":70,"y":815,"width":792,"height":11}},{"id":"c37c277d-1210-42b3-a983-a0c5430eceab","block_type":"box","text":"backed securities at a premium, prepayments may result in a loss to the extent of the premium paid. If a Fund buys","page_number":32,"box":{"x":69,"y":830,"width":825,"height":11}},{"id":"72b57afe-1070-4dcb-be7e-56e66fc92e08","block_type":"box","text":"such securities at a discount, both scheduled payments and unscheduled prepayments will increase current and total","page_number":32,"box":{"x":69,"y":846,"width":838,"height":10}},{"id":"945ef9a7-7911-4da3-a733-3afab91704cb","block_type":"box","text":"returns and unscheduled prepayments will also accelerate the recognition of income which, when distributed to","page_number":32,"box":{"x":69,"y":860,"width":793,"height":12}},{"id":"7913082d-8885-4731-a9d9-5afad4c88404","block_type":"box","text":"shareholders, will be taxable as ordinary income. In a period of rising interest rates, prepayments of the underlying","page_number":32,"box":{"x":69,"y":875,"width":819,"height":12}},{"id":"3791e323-f299-4e82-a9cc-1a202ea796a3","block_type":"box","text":"assets may occur at a slower than expected rate, creating maturity extension risk. This par ticular risk may effectively","page_number":32,"box":{"x":69,"y":891,"width":834,"height":11}},{"id":"c1885994-f140-40a0-b0a1-a510f4b06ed2","block_type":"box","text":"change a security that was considered shor t- or intermediate-term at the time of purchase into a longer term security.","page_number":32,"box":{"x":69,"y":906,"width":837,"height":11}},{"id":"932fe6d1-da99-4ba4-99f9-c2acbfbb72bb","block_type":"box","text":"II-1","page_number":32,"box":{"x":478,"y":943,"width":23,"height":9}},{"id":"a95dffb3-4a8a-42d3-8b1e-7e414adfef8e","block_type":"box","text":"NM1026U-5982568-32/232","page_number":32,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"0012af7d-0861-420a-8bb1-6f14c02307ad","block_type":"box","text":"Since the value of longer-term securities generally fluctuates more widely in response to changes in interest rates","page_number":33,"box":{"x":69,"y":45,"width":810,"height":11}},{"id":"cfa3978f-a779-479e-8bc2-598400db2ffa","block_type":"box","text":"than does the value of shor ter-term securities, maturity extension risk could increase the volatility of the Fund. When","page_number":33,"box":{"x":68,"y":60,"width":833,"height":11}},{"id":"dd66a7b1-f07d-4048-a4ed-d7c3f522d194","block_type":"box","text":"interest rates decline, the value of an asset-backed security with prepayment features may not increase as much as","page_number":33,"box":{"x":70,"y":75,"width":827,"height":11}},{"id":"d8b60284-8b05-4f0e-882a-ddc3265e4501","block_type":"box","text":"that of other fixed-income securities, and, as noted above, changes in market rates of interest may accelerate or","page_number":33,"box":{"x":68,"y":90,"width":805,"height":11}},{"id":"f9df6967-1162-4047-8340-2b2d07ec0cfa","block_type":"box","text":"retard prepayments and thus affect maturities.","page_number":33,"box":{"x":69,"y":105,"width":333,"height":11}},{"id":"6ea23ce7-1326-4d16-b82a-067d4a000774","block_type":"box","text":"Asset-Based Securities.","page_number":33,"box":{"x":101,"y":128,"width":173,"height":9}},{"id":"a462dff1-f76b-4925-bdec-1a81dda864a1","block_type":"box","text":"Cer tain Funds may invest in debt, preferred or conver tible securities, the principal","page_number":33,"box":{"x":281,"y":128,"width":582,"height":11}},{"id":"59c2110d-c27e-48cf-a3a5-f09b6a07f1a0","block_type":"box","text":"amount, redemption terms or conversion terms of which are related to the market price of some natural resource","page_number":33,"box":{"x":69,"y":143,"width":808,"height":11}},{"id":"a5d292cc-67b0-4278-b098-386a7f8cd2ee","block_type":"box","text":"asset such as gold bullion. These securities are referred to as “asset-based securities.” A Fund will purchase only","page_number":33,"box":{"x":69,"y":158,"width":815,"height":11}},{"id":"0def725f-969f-4621-853b-a954a62d5175","block_type":"box","text":"asset-based securities that are rated, or are issued by issuers that have outstanding debt obligations rated,","page_number":33,"box":{"x":69,"y":173,"width":769,"height":11}},{"id":"233a738b-42dc-4e8a-b3ae-97d27d11dcaa","block_type":"box","text":"investment grade (for example, AAA, AA, A or BBB by S&P Global Ratings (“S&P”) or Fitch Ratings (“Fitch”), or Baa by","page_number":33,"box":{"x":70,"y":188,"width":833,"height":12}},{"id":"fbe6523a-f3e1-4161-9e76-6247d5459008","block_type":"box","text":"Moody’s Investors Service, Inc. (“Moody’s”) or commercial paper rated A-1 by S&P or Prime-1 by Moody’s) or by","page_number":33,"box":{"x":70,"y":203,"width":795,"height":12}},{"id":"40b68264-a8bc-4325-94ee-ea7d90ddcbe2","block_type":"box","text":"issuers that the Manager has determined to be of similar creditwor thiness. Obligations ranked in the four th highest","page_number":33,"box":{"x":70,"y":218,"width":824,"height":12}},{"id":"bfa9b194-3663-4ae8-9051-a5ea96e414ba","block_type":"box","text":"rating category, while considered “investment grade,” may have cer tain speculative characteristics and may be more","page_number":33,"box":{"x":69,"y":234,"width":832,"height":11}},{"id":"0aa874a4-4557-414d-a89b-83fefd18663b","block_type":"box","text":"likely to be downgraded than securities rated in the three highest rating categories. If an asset-based security is","page_number":33,"box":{"x":70,"y":249,"width":797,"height":11}},{"id":"7ac08e00-2a46-434d-a105-201cc4697d8d","block_type":"box","text":"backed by a bank letter of credit or other similar facility, the Manager may take such backing into account in","page_number":33,"box":{"x":69,"y":264,"width":768,"height":11}},{"id":"ac3bc50b-f8ea-4c2b-9a6d-3d9bf3eef8bb","block_type":"box","text":"determining the creditwor thiness of the issuer. While the market prices for an asset-based security and the related","page_number":33,"box":{"x":69,"y":279,"width":819,"height":11}},{"id":"bb351253-438f-407e-b750-d1c25218fd2a","block_type":"box","text":"natural resource asset generally are expected to move in the same direction, there may not be per fect correlation in","page_number":33,"box":{"x":69,"y":294,"width":829,"height":11}},{"id":"5029e185-8636-4101-a6de-8e7a3f7ca0c3","block_type":"box","text":"the two price movements. Asset-based securities may not be secured by a security interest in or claim on the","page_number":33,"box":{"x":68,"y":309,"width":780,"height":11}},{"id":"42ca3fcb-30c9-43ff-aa6f-b1f9144e2926","block_type":"box","text":"underlying natural resource asset. The asset-based securities in which a Fund may invest may bear interest or pay","page_number":33,"box":{"x":69,"y":325,"width":815,"height":11}},{"id":"2db68098-086e-4e37-9d13-eb1c4f826b0c","block_type":"box","text":"preferred dividends at below market (or even relatively nominal) rates. Cer tain asset-based securities may be payable","page_number":33,"box":{"x":70,"y":339,"width":837,"height":12}},{"id":"ecc8bc0c-137d-44e0-b7bc-11d2677a2397","block_type":"box","text":"at maturity in cash at the stated principal amount or, at the option of the holder, directly in a stated amount of the","page_number":33,"box":{"x":69,"y":355,"width":812,"height":11}},{"id":"7c75b42c-7aca-4af5-9b8a-464416a60814","block_type":"box","text":"asset to which it is related. In such instance, because no Fund presently intends to invest directly in natural resource","page_number":33,"box":{"x":69,"y":370,"width":836,"height":11}},{"id":"0c92858d-9b96-4277-b097-c181daf28518","block_type":"box","text":"assets, a Fund would sell the asset-based security in the secondary market, to the extent one exists, prior to","page_number":33,"box":{"x":69,"y":385,"width":778,"height":11}},{"id":"4b1d5b52-10e5-4f64-96a0-652adbd1c2e6","block_type":"box","text":"maturity if the value of the stated amount of the asset exceeds the stated principal amount and thereby realize the","page_number":33,"box":{"x":69,"y":400,"width":819,"height":11}},{"id":"8cb9f91f-3a58-4b7b-b4e0-1fd06850447a","block_type":"box","text":"appreciation in the underlying asset.","page_number":33,"box":{"x":69,"y":415,"width":258,"height":11}},{"id":"8e153c1f-b01e-4463-9f7a-2a5c70ca0d7b","block_type":"box","text":"Precious Metal-Related Securities.","page_number":33,"box":{"x":102,"y":438,"width":243,"height":9}},{"id":"7b5c2646-1fd9-4216-b4c9-bcd07ddfd7c4","block_type":"box","text":"A Fund may invest in the equity and other securities of companies that","page_number":33,"box":{"x":351,"y":438,"width":503,"height":11}},{"id":"679ea532-9980-4eec-917f-38774d1ed94e","block_type":"box","text":"explore for, extract, process or deal in precious metals (","page_number":33,"box":{"x":69,"y":453,"width":398,"height":11}},{"id":"f7a22e01-5e02-49a9-bf05-49ff0ffc6620","block_type":"box","text":"e.g.","page_number":33,"box":{"x":469,"y":454,"width":25,"height":10}},{"id":"9cd5f186-43e7-4dce-8433-1ea3536c4d5f","block_type":"box","text":", gold, silver and platinum), and in asset-based securities","page_number":33,"box":{"x":497,"y":453,"width":407,"height":11}},{"id":"eb7655df-ce50-4fb8-98bd-9712292100ff","block_type":"box","text":"indexed to the value of such metals. Such securities may be purchased when they are believed to be attractively","page_number":33,"box":{"x":70,"y":468,"width":801,"height":11}},{"id":"c0fa28ce-4aae-4146-8767-d335af5313b7","block_type":"box","text":"priced in relation to the value of a company’s precious metal-related assets or when the values of precious metals","page_number":33,"box":{"x":70,"y":483,"width":815,"height":11}},{"id":"962a6771-003b-42e8-b4f1-0b76562f3318","block_type":"box","text":"are expected to benefit from inflationary pressure or other economic, political or financial uncer tainty or instability.","page_number":33,"box":{"x":69,"y":498,"width":815,"height":11}},{"id":"3968d416-5020-424f-a134-752c9577227a","block_type":"box","text":"Based on historical experience, during periods of economic or financial instability the securities of companies","page_number":33,"box":{"x":70,"y":513,"width":779,"height":12}},{"id":"b8796d06-6273-4091-a8a0-78ef51c85d14","block_type":"box","text":"involved in precious metals may be subject to extreme price fluctuations, reflecting the high volatility of precious","page_number":33,"box":{"x":70,"y":528,"width":799,"height":12}},{"id":"8433c751-fbb9-4938-a5c5-0bf0f3c90275","block_type":"box","text":"metal prices during such periods. In addition, the instability of precious metal prices may result in volatile earnings of","page_number":33,"box":{"x":69,"y":543,"width":838,"height":12}},{"id":"32045bd5-a405-4429-9a74-d43d1a748330","block_type":"box","text":"precious metal-related companies, which may, in turn, adversely affect the financial condition of such companies. The","page_number":33,"box":{"x":70,"y":559,"width":838,"height":11}},{"id":"25eaffb4-f571-4656-8473-79da1fb5d96e","block_type":"box","text":"major producers of gold include the Republic of South Africa, Russia, Canada, the United States, Brazil and Australia.","page_number":33,"box":{"x":69,"y":574,"width":835,"height":11}},{"id":"3dbb869f-6fd0-43e9-9a9e-8057b8d8d065","block_type":"box","text":"Sales of gold by Russia are largely unpredictable and often relate to political and economic considerations rather","page_number":33,"box":{"x":69,"y":589,"width":806,"height":11}},{"id":"b785d54c-06bb-4b34-9d43-9d3ee4999e50","block_type":"box","text":"than to market forces. Economic, financial, social and political factors within South Africa may significantly affect","page_number":33,"box":{"x":68,"y":604,"width":805,"height":11}},{"id":"8bb44c87-45ff-4235-bc8f-23f43690545e","block_type":"box","text":"South African gold production.","page_number":33,"box":{"x":69,"y":619,"width":213,"height":11}},{"id":"d98d7c58-2c48-477b-81b8-603d01eec472","block_type":"box","text":"Borrowing and Leverage.","page_number":33,"box":{"x":102,"y":642,"width":179,"height":11}},{"id":"8c7e3850-1916-42c2-83b9-0b5a2fdffb3c","block_type":"box","text":"Each Fund may borrow as a temporary measure for extraordinary or emergency","page_number":33,"box":{"x":288,"y":642,"width":563,"height":11}},{"id":"ba52fc07-64df-4495-a5c8-4f2b46adce4b","block_type":"box","text":"purposes, including to meet redemptions or to settle securities transactions. Cer tain Funds will not purchase","page_number":33,"box":{"x":70,"y":657,"width":777,"height":11}},{"id":"b10238a7-b77d-405f-a47c-184cd41087b5","block_type":"box","text":"securities at any time when borrowings exceed 5% of their total assets, except (a) to honor prior commitments or","page_number":33,"box":{"x":69,"y":672,"width":806,"height":11}},{"id":"6f2b4653-4d98-4c69-8f66-8fdcaee22ded","block_type":"box","text":"(b) to exercise subscription rights when outstanding borrowings have been obtained exclusively for settlements of","page_number":33,"box":{"x":69,"y":687,"width":810,"height":11}},{"id":"db2db0f3-b7e0-444b-8b7f-2d447cc13657","block_type":"box","text":"other securities transactions.","page_number":33,"box":{"x":69,"y":703,"width":207,"height":8}},{"id":"1da886a3-103b-41a5-9b49-64d31fd0a773","block_type":"box","text":"Cer tain Funds may also borrow in order to make investments, to the extent disclosed in such Fund’s Prospectus.","page_number":33,"box":{"x":102,"y":725,"width":806,"height":11}},{"id":"9c858161-5ab5-4db4-8830-568e173e8f5e","block_type":"box","text":"The purchase of securities while borrowings are outstanding will have the effect of leveraging the Fund. Such","page_number":33,"box":{"x":68,"y":740,"width":776,"height":11}},{"id":"0762bd95-25ec-447e-8e2e-1f2bc8d5ad2d","block_type":"box","text":"leveraging increases the Fund’s exposure to capital risk, and borrowed funds are subject to interest costs that will","page_number":33,"box":{"x":70,"y":755,"width":813,"height":11}},{"id":"51f0bb41-b68a-42c0-a86f-c6f5fc2364c3","block_type":"box","text":"reduce net income. The use of leverage by a Fund creates an oppor tunity for greater total return, but, at the same","page_number":33,"box":{"x":69,"y":770,"width":813,"height":12}},{"id":"0504786f-7439-4e36-bfd1-2b5f003b316a","block_type":"box","text":"time, creates special risks. For example, leveraging may exaggerate changes in the net asset value (“NAV”) of Fund","page_number":33,"box":{"x":68,"y":785,"width":823,"height":12}},{"id":"76391cd9-c557-4eb9-827e-a0cb4ec2b970","block_type":"box","text":"shares and in the yield on the Fund’s por tfolio. Although the principal of such borrowings will be fixed, the Fund’s","page_number":33,"box":{"x":69,"y":801,"width":806,"height":11}},{"id":"2680755f-b547-40a6-9763-ebd8648567a1","block_type":"box","text":"assets may change in value during the time the borrowings are outstanding. Borrowings will create interest expenses","page_number":33,"box":{"x":69,"y":816,"width":835,"height":11}},{"id":"0c7c81e6-6ff4-41cf-b285-9021cdf395bc","block_type":"box","text":"for the Fund that can exceed the income from the assets purchased with the borrowings. To the extent the income or","page_number":33,"box":{"x":68,"y":831,"width":835,"height":11}},{"id":"93258722-d898-4753-8355-669941b29f31","block_type":"box","text":"capital appreciation derived from securities purchased with borrowed funds exceeds the interest the Fund will have to","page_number":33,"box":{"x":69,"y":846,"width":838,"height":11}},{"id":"a86c5646-7299-41f6-b406-1812a92dea1a","block_type":"box","text":"pay on the borrowings, the Fund’s return will be greater than if leverage had not been used. Conversely, if the income","page_number":33,"box":{"x":70,"y":861,"width":835,"height":11}},{"id":"7fce0688-440e-4429-82d2-7f9fb805f83a","block_type":"box","text":"or capital appreciation from the securities purchased with such borrowed funds is not sufficient to cover the cost of","page_number":33,"box":{"x":69,"y":876,"width":825,"height":11}},{"id":"2a873a1d-5c72-4f58-bcab-23bb2c98bea8","block_type":"box","text":"borrowing, the return to the Fund will be less than if leverage had not been used and, therefore, the amount available","page_number":33,"box":{"x":69,"y":891,"width":837,"height":12}},{"id":"f0519e01-6730-4823-99fa-105467215086","block_type":"box","text":"for distribution to shareholders as dividends will be reduced. In the latter case, the Manager in its best judgment","page_number":33,"box":{"x":68,"y":906,"width":805,"height":12}},{"id":"5e076e23-0d48-443f-8f2a-fcad80f2f012","block_type":"box","text":"II-2","page_number":33,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"8111ffcc-8480-41e4-93a3-372e608e971a","block_type":"box","text":"NM1026U-5982568-33/232","page_number":33,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"a61b2900-8325-4905-960e-4a0adfc8221e","block_type":"box","text":"never theless may determine to maintain the Fund’s leveraged position if it expects that the benefits to the Fund’s","page_number":34,"box":{"x":69,"y":45,"width":813,"height":11}},{"id":"6aff5150-e774-44ba-9068-6cb6850ece19","block_type":"box","text":"shareholders of maintaining the leveraged position will outweigh the current reduced return.","page_number":34,"box":{"x":69,"y":60,"width":653,"height":11}},{"id":"3d2afd92-b436-4fa4-9112-3b06b175d688","block_type":"box","text":"Cer tain types of borrowings by a Fund may result in the Fund being subject to covenants in credit agreements","page_number":34,"box":{"x":102,"y":82,"width":780,"height":12}},{"id":"2eadb2c3-b580-4b8d-918d-42379d6f8e90","block_type":"box","text":"relating to asset coverage, por tfolio composition requirements and other matters. It is not anticipated that","page_number":34,"box":{"x":69,"y":98,"width":759,"height":11}},{"id":"c7bbc414-46c9-4fe2-abe1-bead9e919058","block_type":"box","text":"observance of such covenants would impede the Manager from managing a Fund’s por tfolio in accordance with the","page_number":34,"box":{"x":69,"y":113,"width":822,"height":11}},{"id":"39aa35f9-e8c2-467e-a0f3-1f8cb3423093","block_type":"box","text":"Fund’s investment objectives and policies. However, a breach of any such covenants not cured within the specified","page_number":34,"box":{"x":70,"y":128,"width":816,"height":11}},{"id":"69b338fa-1054-4be4-a444-108ea5d3c331","block_type":"box","text":"cure period may result in acceleration of outstanding indebtedness and require the Fund to dispose of por tfolio","page_number":34,"box":{"x":69,"y":143,"width":792,"height":11}},{"id":"fc5c1b41-7acd-4621-b4e0-2f749f93b34f","block_type":"box","text":"investments at a time when it may be disadvantageous to do so.","page_number":34,"box":{"x":70,"y":158,"width":459,"height":11}},{"id":"1281282e-a981-46ac-8de0-643ac45fe44a","block_type":"box","text":"Each Fund may at times borrow from affiliates of the Manager, provided that the terms of such borrowings are","page_number":34,"box":{"x":102,"y":181,"width":786,"height":11}},{"id":"ca4c0488-59dc-4852-9b7f-484627951edb","block_type":"box","text":"no less favorable than those available from comparable sources of funds in the marketplace.","page_number":34,"box":{"x":69,"y":196,"width":663,"height":11}},{"id":"15859527-ec1d-4662-ab35-a676f962ed24","block_type":"box","text":"Cash Management.","page_number":34,"box":{"x":102,"y":219,"width":140,"height":11}},{"id":"92283c32-db03-49dd-b21c-3a8fc9ef550a","block_type":"box","text":"Generally, the Manager will employ futures and options on futures to provide liquidity","page_number":34,"box":{"x":249,"y":218,"width":603,"height":12}},{"id":"933a7fb4-cfed-4f7a-96dc-b04edec74def","block_type":"box","text":"necessary to meet anticipated redemptions or for day-to-day operating purposes. However, if considered appropriate","page_number":34,"box":{"x":69,"y":234,"width":828,"height":11}},{"id":"e1d62f6c-9ec4-46f6-a6a3-c1de27451e77","block_type":"box","text":"in the opinion of the Manager, a por tion of a Fund’s assets may be invested in cer tain types of instruments with","page_number":34,"box":{"x":70,"y":249,"width":799,"height":11}},{"id":"1160ee7d-104c-47f8-9c61-b18d24579088","block_type":"box","text":"remaining maturities of 397 days or less for liquidity purposes. Such instruments would consist of: (i) obligations of","page_number":34,"box":{"x":69,"y":264,"width":826,"height":11}},{"id":"d0041220-ae02-4199-9672-f70be7b1bf82","block_type":"box","text":"the U.S. Government, its agencies, instrumentalities, authorities or political subdivisions (“U.S. Government","page_number":34,"box":{"x":68,"y":279,"width":772,"height":11}},{"id":"cc9b8b4b-a95c-4db3-ae7a-7fdfa5fd7b6a","block_type":"box","text":"Securities”); (ii) other fixed-income securities rated Aa or higher by Moody’s or AA or higher by S&P or, if unrated, of","page_number":34,"box":{"x":69,"y":294,"width":823,"height":11}},{"id":"31cce468-3a1f-481e-960d-cff447f70d80","block_type":"box","text":"comparable quality in the opinion of the Manager; (iii) commercial paper; (iv) bank obligations, including negotiable","page_number":34,"box":{"x":69,"y":309,"width":816,"height":11}},{"id":"d3bac1d4-1508-48d7-bb98-85cc4823447b","block_type":"box","text":"cer tificates of deposit, time deposits and bankers’ acceptances; and (v) repurchase agreements. At the time the","page_number":34,"box":{"x":69,"y":324,"width":804,"height":12}},{"id":"6597c886-1c36-4d05-a830-16907271ccf0","block_type":"box","text":"Fund invests in commercial paper, bank obligations or repurchase agreements, the issuer or the issuer’s parent must","page_number":34,"box":{"x":70,"y":340,"width":839,"height":11}},{"id":"b085b12c-b256-44cb-9e54-bbd2ff6d2079","block_type":"box","text":"have outstanding debt rated Aa or higher by Moody’s or AA or higher by S&P or outstanding commercial paper, bank","page_number":34,"box":{"x":69,"y":355,"width":824,"height":11}},{"id":"b5fce06a-cea7-4ba0-91c3-9d6fb1db1110","block_type":"box","text":"obligations or other shor t-term obligations rated Prime-1 by Moody’s or A-1 by S&P; or, if no such ratings are","page_number":34,"box":{"x":69,"y":370,"width":771,"height":11}},{"id":"54b6c902-8e0b-471a-ae08-f618caf6963d","block_type":"box","text":"available, the instrument must be of comparable quality in the opinion of the Manager. For more information on","page_number":34,"box":{"x":69,"y":385,"width":793,"height":11}},{"id":"018b7e7b-361c-425b-bd09-2138af7f1d3d","block_type":"box","text":"money market instruments, see “Money Market Securities” below.","page_number":34,"box":{"x":69,"y":400,"width":472,"height":11}},{"id":"3d107f85-ac06-44b7-9671-8594d89babec","block_type":"box","text":"Collateralized Debt Obligations.","page_number":34,"box":{"x":102,"y":423,"width":229,"height":11}},{"id":"13e948dc-7b3b-49b3-9993-c7438beda362","block_type":"box","text":"Cer tain Funds may invest in collateralized debt obligations (“CDOs”), which","page_number":34,"box":{"x":337,"y":423,"width":534,"height":11}},{"id":"4455b763-881e-4c8b-8eef-55808948fe81","block_type":"box","text":"include collateralized bond obligations (“CBOs”), collateralized loan obligations (“CLOs”) and other similarly","page_number":34,"box":{"x":70,"y":438,"width":764,"height":11}},{"id":"681869e1-3a4e-4fc5-86a8-5e81c719ba71","block_type":"box","text":"structured securities. CDOs are types of asset-backed securities. A CBO is ordinarily issued by a trust or other","page_number":34,"box":{"x":69,"y":453,"width":787,"height":11}},{"id":"9ed88b97-cc63-451f-8f16-d33432412dd8","block_type":"box","text":"special purpose entity (“SPE”) and is typically backed by a diversified pool of fixed-income securities (which may","page_number":34,"box":{"x":69,"y":468,"width":797,"height":11}},{"id":"80e46b70-ad07-49d2-b36a-3623b0cbb69c","block_type":"box","text":"include high risk, below investment grade securities) held by such issuer. A CLO is ordinarily issued by a trust or","page_number":34,"box":{"x":70,"y":483,"width":798,"height":11}},{"id":"1b622ca0-3ca3-4317-9769-f87940104e24","block_type":"box","text":"other SPE and is typically collateralized by a pool of loans, which may include, among others, domestic and non-U.S.","page_number":34,"box":{"x":69,"y":498,"width":827,"height":11}},{"id":"7254ea8e-041e-47c1-9e77-037708750978","block_type":"box","text":"senior secured loans, senior unsecured loans, and subordinate corporate loans, including loans that may be rated","page_number":34,"box":{"x":69,"y":514,"width":814,"height":11}},{"id":"350bb13b-6fed-4b79-8f70-ef995a4acade","block_type":"box","text":"below investment grade or equivalent unrated loans, held by such issuer. Investments in a CLO organized outside of","page_number":34,"box":{"x":69,"y":528,"width":828,"height":12}},{"id":"8d20dd00-f7a2-4ed1-8642-c13fadd0c4fc","block_type":"box","text":"the United States may not be deemed to be foreign securities if the CLO is collateralized by a pool of loans, a","page_number":34,"box":{"x":68,"y":543,"width":782,"height":12}},{"id":"3a3e1ac0-f12d-48d8-9112-ea36587384bc","block_type":"box","text":"substantial por tion of which are U.S. loans. Although cer tain CDOs may benefit from credit enhancement in the form","page_number":34,"box":{"x":69,"y":559,"width":830,"height":11}},{"id":"90334c32-c100-4d54-afb1-b5fd573abc48","block_type":"box","text":"of a senior-subordinate structure, over-collateralization or bond insurance, such enhancement may not always be","page_number":34,"box":{"x":69,"y":574,"width":803,"height":11}},{"id":"8279a98b-2844-479a-8276-4e080f703556","block_type":"box","text":"present, and may fail to protect a Fund against the risk of loss on default of the collateral. Cer tain CDO issuers may","page_number":34,"box":{"x":70,"y":589,"width":827,"height":11}},{"id":"341b34f2-0a89-43ae-91b2-31dacd0df3bc","block_type":"box","text":"use derivatives contracts to create “synthetic” exposure to assets rather than holding such assets directly, which","page_number":34,"box":{"x":69,"y":604,"width":807,"height":11}},{"id":"27be9002-9bf0-4338-8f80-3a5b4150eced","block_type":"box","text":"entails the risks of derivative instruments described elsewhere in this SAI. CDOs may charge management fees and","page_number":34,"box":{"x":69,"y":619,"width":826,"height":11}},{"id":"a10abf87-f5da-477a-a14d-a8d9f4b2b0e9","block_type":"box","text":"administrative expenses, which are in addition to those of a Fund.","page_number":34,"box":{"x":69,"y":634,"width":469,"height":11}},{"id":"aa42da3b-901b-4f20-9f5d-0a9b8058fe5c","block_type":"box","text":"For both CBOs and CLOs, the cash flows from the SPE are split into two or more por tions, called tranches,","page_number":34,"box":{"x":102,"y":657,"width":758,"height":11}},{"id":"99946b8a-6032-491a-bdc4-dc66b8cf873b","block_type":"box","text":"varying in risk and yield. The riskiest por tion is the “equity” tranche, which bears the first loss from defaults from the","page_number":34,"box":{"x":68,"y":672,"width":836,"height":11}},{"id":"90ee353a-ee49-4354-b629-0b6896614b12","block_type":"box","text":"bonds or loans in the SPE and serves to protect the other, more senior tranches from default (though such protection","page_number":34,"box":{"x":69,"y":687,"width":838,"height":11}},{"id":"40b45412-08d6-4f9f-ba69-03e0fd54e63e","block_type":"box","text":"is not complete). Since it is par tially protected from defaults, a senior tranche from a CBO or CLO typically has higher","page_number":34,"box":{"x":70,"y":702,"width":835,"height":12}},{"id":"ed60c1ab-fd39-4b9b-abab-72712e805464","block_type":"box","text":"ratings and lower yields than its underlying securities, and may be rated investment grade. Despite the protection","page_number":34,"box":{"x":69,"y":718,"width":808,"height":11}},{"id":"0ed567b5-6648-40ef-ae2b-63a5597953bd","block_type":"box","text":"from the equity tranche, CBO or CLO tranches can experience substantial losses due to actual defaults, downgrades","page_number":34,"box":{"x":68,"y":732,"width":830,"height":12}},{"id":"b98a5272-c211-47cd-a176-56f9e27241be","block_type":"box","text":"of the underlying collateral by rating agencies, forced liquidation of the collateral pool due to a failure of coverage","page_number":34,"box":{"x":69,"y":748,"width":806,"height":11}},{"id":"34aa3783-96cf-485d-9790-80987ef9af5b","block_type":"box","text":"tests, increased sensitivity to defaults due to collateral default and disappearance of protecting tranches, market","page_number":34,"box":{"x":68,"y":763,"width":809,"height":11}},{"id":"700551b3-f74b-497e-943a-b91ebc6e0715","block_type":"box","text":"anticipation of defaults as well as investor aversion to CBO or CLO securities as a class. Interest on cer tain tranches","page_number":34,"box":{"x":69,"y":778,"width":835,"height":11}},{"id":"9fc45b27-7398-4e6e-8cf8-6935a475e854","block_type":"box","text":"of a CDO may be paid in kind or deferred and capitalized (paid in the form of obligations of the same type rather than","page_number":34,"box":{"x":69,"y":793,"width":835,"height":11}},{"id":"072ba001-1acc-474f-8878-54303bf8a69a","block_type":"box","text":"cash), which involves continued exposure to default risk with respect to such payments.","page_number":34,"box":{"x":69,"y":808,"width":625,"height":11}},{"id":"bc6de04a-b993-4058-a747-60dd46cbef93","block_type":"box","text":"The risks of an investment in a CDO depend largely on the type of the collateral securities and the class of the","page_number":34,"box":{"x":101,"y":831,"width":789,"height":11}},{"id":"292ea797-47de-4bd5-b9d6-29755fb12a65","block_type":"box","text":"CDO in which a Fund invests. Normally, CBOs, CLOs and other CDOs are privately offered and sold, and thus are not","page_number":34,"box":{"x":69,"y":846,"width":830,"height":11}},{"id":"41a76e2e-51f2-469f-bb2f-7b1aa9dd5ab9","block_type":"box","text":"registered under the securities laws. However, an active dealer market may exist for CDOs, allowing a CDO to qualify","page_number":34,"box":{"x":69,"y":861,"width":830,"height":11}},{"id":"49289355-9d19-42ba-8fd6-8249c76a08fa","block_type":"box","text":"for Rule 144A transactions. In addition to the normal risks associated with fixed-income securities and asset-backed","page_number":34,"box":{"x":68,"y":876,"width":831,"height":9}},{"id":"ebd2788d-0180-4018-a0ca-8016e0a8278a","block_type":"box","text":"securities generally discussed elsewhere in this SAI, CDOs carry additional risks including, but not limited to: (i) the","page_number":34,"box":{"x":69,"y":891,"width":824,"height":12}},{"id":"541f36cb-5ea8-409b-b80e-071898930c63","block_type":"box","text":"possibility that distributions from collateral securities will not be adequate to make interest or other payments; (ii) the","page_number":34,"box":{"x":70,"y":906,"width":838,"height":12}},{"id":"bca08a60-9a98-446e-8b05-0c31992741c1","block_type":"box","text":"II-3","page_number":34,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"2cd57d96-4352-46c0-b243-f8581f1e5ed4","block_type":"box","text":"NM1026U-5982568-34/232","page_number":34,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"038b210d-1433-450b-bd1b-1f13a3f2c268","block_type":"box","text":"risk that the collateral may default or decline in value or be downgraded, if rated by a nationally recognized statistical","page_number":35,"box":{"x":69,"y":45,"width":832,"height":11}},{"id":"c590a606-40e1-4a25-a125-6ce3771f8705","block_type":"box","text":"rating organization (“NRSRO”); (iii) a Fund may invest in tranches of CDOs that are subordinate to other tranches;","page_number":35,"box":{"x":69,"y":60,"width":807,"height":11}},{"id":"daa1aeab-c444-434f-a5f4-fac4b57d88ce","block_type":"box","text":"(iv) the structure and complexity of the transaction and the legal documents could lead to disputes among investors","page_number":35,"box":{"x":69,"y":75,"width":826,"height":11}},{"id":"c39241b2-e853-4f45-9726-179c23e3306a","block_type":"box","text":"regarding the characterization of proceeds; (v) the investment return achieved by the Fund could be significantly","page_number":35,"box":{"x":69,"y":90,"width":795,"height":11}},{"id":"1483ccbe-e030-46a7-b313-0b52386dd22f","block_type":"box","text":"different than those predicted by financial models; (vi) the lack of a readily available secondary market for CDOs;","page_number":35,"box":{"x":69,"y":105,"width":804,"height":11}},{"id":"60fddca1-f499-4940-971f-800e6390effb","block_type":"box","text":"(vii) the risk of forced “fire sale” liquidation due to technical defaults such as coverage test failures; and (viii) the","page_number":35,"box":{"x":69,"y":120,"width":805,"height":12}},{"id":"0b699e5a-7fc4-477d-96cc-5f3282360a4a","block_type":"box","text":"CDO’s manager may per form poorly.","page_number":35,"box":{"x":69,"y":135,"width":257,"height":12}},{"id":"18f8565e-aaed-4cea-a808-8ac159506f63","block_type":"box","text":"Commercial Paper.","page_number":35,"box":{"x":102,"y":158,"width":136,"height":11}},{"id":"63255c8f-8095-4d92-a0a5-0adfcad5282f","block_type":"box","text":"Cer tain Funds may purchase commercial paper. Commercial paper purchasable by each","page_number":35,"box":{"x":244,"y":158,"width":626,"height":11}},{"id":"3aa6f3a9-5d9e-44ac-91e5-c1d6bc68a9de","block_type":"box","text":"Fund includes “Section 4(a)(2) paper,” a term that includes debt obligations issued in reliance on the “private","page_number":35,"box":{"x":70,"y":173,"width":781,"height":11}},{"id":"29e6bd29-7659-4ad8-ba05-e6bf76d129b7","block_type":"box","text":"placement” exemption from registration afforded by Section 4(a)(2) of the Securities Act. Section 4(a)(2) paper is","page_number":35,"box":{"x":70,"y":188,"width":806,"height":12}},{"id":"2db4c165-8204-4578-9c5d-896eb6046292","block_type":"box","text":"restricted as to disposition under the Federal securities laws, and is frequently sold (and resold) to institutional","page_number":35,"box":{"x":69,"y":203,"width":792,"height":12}},{"id":"5c61774a-3367-4c0c-8c84-348d1900f3a3","block_type":"box","text":"investors such as the Fund through or with the assistance of investment dealers who make a market in the Section","page_number":35,"box":{"x":70,"y":218,"width":820,"height":12}},{"id":"3b26fdb8-a5ef-48db-9adb-a5fc4fe3d062","block_type":"box","text":"4(a)(2) paper, thereby providing liquidity. Cer tain transactions in Section 4(a)(2) paper may qualify for the registration","page_number":35,"box":{"x":69,"y":234,"width":831,"height":11}},{"id":"02ea9d84-7dfc-430b-aa73-60d1dbefa3f0","block_type":"box","text":"exemption provided in Rule 144A under the Securities Act. Most Funds can purchase commercial paper rated (at the","page_number":35,"box":{"x":69,"y":249,"width":831,"height":11}},{"id":"359b0363-68d7-41d0-a2d1-48b13aa0451b","block_type":"box","text":"time of purchase) “A-1” by S&P or “Prime-1” by Moody’s or when deemed advisable by a Fund’s Manager or sub","page_number":35,"box":{"x":68,"y":264,"width":805,"height":11}},{"id":"88f75db9-3594-45cb-83de-dbd68910fd4c","block_type":"box","text":"adviser, “high quality” issues rated “A-2”, “Prime-2” or “F-2” by S&P, Moody’s or Fitch, respectively.","page_number":35,"box":{"x":69,"y":279,"width":707,"height":11}},{"id":"1b378b80-8e99-4207-8d45-65c6e8001910","block_type":"box","text":"Commercial paper is generally considered to be shor t-term unsecured debt of corporations. Like all fixed income","page_number":35,"box":{"x":102,"y":302,"width":801,"height":11}},{"id":"f94f90bd-d819-4cb1-9daf-613b94ac30aa","block_type":"box","text":"securities, commercial paper prices are susceptible to fluctuations in interest rates. If interest rates rise, commercial","page_number":35,"box":{"x":69,"y":317,"width":836,"height":11}},{"id":"2e22b28c-6c5f-4a3e-a9e1-c05b8e64a8c2","block_type":"box","text":"paper prices will decline and vice versa. However, the shor t-term nature of a commercial paper investment generally","page_number":35,"box":{"x":70,"y":332,"width":826,"height":11}},{"id":"eda87969-f24d-4cd3-8d90-7036d5cd4038","block_type":"box","text":"makes it less susceptible to volatility than many other fixed income securities because interest rate risk typically","page_number":35,"box":{"x":69,"y":347,"width":803,"height":11}},{"id":"44dac352-c567-4679-9603-c2ebb0f6cb98","block_type":"box","text":"increases as maturity lengths increase. Commercial paper tends to yield smaller returns than longer-term corporate","page_number":35,"box":{"x":70,"y":362,"width":822,"height":11}},{"id":"ee05a1a7-ced4-4c8d-831f-4925eef6713f","block_type":"box","text":"debt because securities with shor ter maturities typically have lower effective yields than those with longer maturities.","page_number":35,"box":{"x":69,"y":377,"width":835,"height":12}},{"id":"f429fa26-ba6c-4099-aa08-3b9654d0fadc","block_type":"box","text":"Commodity-Linked Derivative Instruments and Hybrid Instruments.","page_number":35,"box":{"x":102,"y":400,"width":483,"height":11}},{"id":"3cc4637e-dcb3-42ab-a7d0-c1f4ac1401ab","block_type":"box","text":"Cer tain Funds seek to gain exposure to the","page_number":35,"box":{"x":591,"y":400,"width":308,"height":11}},{"id":"fc41f1be-9123-4271-823d-01627cdaddee","block_type":"box","text":"commodities markets primarily through investments in hybrid instruments. Hybrid instruments are either equity or","page_number":35,"box":{"x":69,"y":415,"width":809,"height":11}},{"id":"a154fd94-0665-44ff-a760-0633ee550480","block_type":"box","text":"debt derivative securities with one or more commodity-dependent components that have payment features similar to","page_number":35,"box":{"x":69,"y":430,"width":828,"height":11}},{"id":"75d4f9b4-5981-48e1-9789-861fb4942929","block_type":"box","text":"a commodity futures contract, a commodity option contract, or a combination of both. Therefore, these instruments","page_number":35,"box":{"x":69,"y":445,"width":822,"height":11}},{"id":"59e40e22-40ea-4977-83fc-8ca05d1e9390","block_type":"box","text":"are “commodity-linked.” They are considered “hybrid” instruments because they have both commodity-like and","page_number":35,"box":{"x":69,"y":461,"width":787,"height":11}},{"id":"31843ece-b740-45f7-972f-a7e10ed1de3c","block_type":"box","text":"security-like characteristics. Hybrid instruments are derivative instruments because at least par t of their value is","page_number":35,"box":{"x":69,"y":475,"width":801,"height":12}},{"id":"7687ae14-5cea-400f-ab64-19507d5c023d","block_type":"box","text":"derived from the value of an underlying commodity, futures contract, index or other readily measurable economic","page_number":35,"box":{"x":69,"y":491,"width":800,"height":11}},{"id":"10d6745f-056c-47b7-b5a0-ce9f81f2fb2c","block_type":"box","text":"variable.","page_number":35,"box":{"x":68,"y":506,"width":59,"height":9}},{"id":"881e364d-ccb3-490e-bb77-7d06bc8eaaf5","block_type":"box","text":"The prices of commodity-linked derivative instruments may move in different directions than investments in","page_number":35,"box":{"x":101,"y":528,"width":763,"height":12}},{"id":"2f812a58-1315-4faa-96fe-b58507f23ba3","block_type":"box","text":"traditional equity and debt securities when the value of those traditional securities is declining due to adverse","page_number":35,"box":{"x":68,"y":543,"width":783,"height":12}},{"id":"60cb50a4-dfc6-4d4c-b753-7167fe77fb99","block_type":"box","text":"economic conditions. As an example, during periods of rising inflation, debt securities have historically tended to","page_number":35,"box":{"x":69,"y":559,"width":802,"height":11}},{"id":"f8eeec30-5c07-4a39-9b8b-443e9200c291","block_type":"box","text":"decline in value due to the general increase in prevailing interest rates. Conversely, during those same periods of","page_number":35,"box":{"x":69,"y":574,"width":808,"height":11}},{"id":"e1f9aca8-1ee3-4e96-a9f5-098acf662921","block_type":"box","text":"rising inflation, the prices of cer tain commodities, such as oil and metals, have historically tended to increase. Of","page_number":35,"box":{"x":69,"y":589,"width":811,"height":11}},{"id":"df780d0e-5110-4cb3-af87-073bf477c238","block_type":"box","text":"course, there cannot be any guarantee that these investments will per form in that manner in the future, and at","page_number":35,"box":{"x":69,"y":604,"width":791,"height":11}},{"id":"0ce266e9-da92-4146-ab1c-07637458aa0f","block_type":"box","text":"cer tain times the price movements of commodity-linked instruments have been parallel to those of debt and equity","page_number":35,"box":{"x":69,"y":619,"width":819,"height":11}},{"id":"ceb7acf3-d852-4caf-bc5d-999314807165","block_type":"box","text":"securities. Commodities have historically tended to increase and decrease in value during different par ts of the","page_number":35,"box":{"x":69,"y":634,"width":795,"height":12}},{"id":"8b9377f0-1059-4b70-b899-60d638934b5e","block_type":"box","text":"business cycle than financial assets. Never theless, at various times, commodities prices may move in tandem with","page_number":35,"box":{"x":69,"y":649,"width":822,"height":12}},{"id":"ed41b6c4-621b-4894-974d-d2f292bde3be","block_type":"box","text":"the prices of financial assets and thus may not provide overall por tfolio diversification benefits. Under favorable","page_number":35,"box":{"x":68,"y":664,"width":797,"height":12}},{"id":"05a70922-f07b-421e-a7c3-20917640c24b","block_type":"box","text":"economic conditions, the Fund’s investments may be expected to under-per form an investment in traditional","page_number":35,"box":{"x":69,"y":680,"width":772,"height":11}},{"id":"01655521-15ff-48cb-8f60-d648ef638772","block_type":"box","text":"securities. Over the long term, the returns on the Fund’s investments are expected to exhibit low or negative","page_number":35,"box":{"x":69,"y":695,"width":773,"height":11}},{"id":"b3c23fcc-631d-4f04-ad8a-5e28a6e52469","block_type":"box","text":"correlation with stocks and bonds.","page_number":35,"box":{"x":69,"y":710,"width":244,"height":9}},{"id":"34a11890-d41a-4428-b9bc-101f7b0af3bf","block_type":"box","text":"Qualifying Hybrid Instruments.","page_number":35,"box":{"x":102,"y":732,"width":212,"height":12}},{"id":"50278e62-f387-428a-a47f-9cfd4de7b6ee","block_type":"box","text":"Cer tain Funds may invest in hybrid instruments that qualify for exclusion from","page_number":35,"box":{"x":320,"y":732,"width":552,"height":12}},{"id":"ddfae08a-1009-457d-bac4-eb52be0da13e","block_type":"box","text":"regulation under the Commodity Exchange Act and the regulations adopted thereunder. A hybrid instrument that","page_number":35,"box":{"x":69,"y":748,"width":795,"height":11}},{"id":"65a8ab7a-7708-4be7-bbba-38a960acfda4","block_type":"box","text":"qualifies for this exclusion from regulation must be “predominantly a security.” A hybrid instrument is considered to","page_number":35,"box":{"x":69,"y":763,"width":822,"height":11}},{"id":"268f41f8-ce17-4b98-863e-58467624048b","block_type":"box","text":"be predominantly a security if (a) the issuer of the hybrid instrument receives payment in full of the purchase price of","page_number":35,"box":{"x":69,"y":778,"width":834,"height":11}},{"id":"a1bd99b8-df92-4626-ba5f-c1e45a5cbc7f","block_type":"box","text":"the hybrid instrument, substantially contemporaneously with delivery of the hybrid instrument; (b) the purchaser or","page_number":35,"box":{"x":68,"y":793,"width":816,"height":11}},{"id":"665517cb-6a15-4790-91ad-3c68ceaf0704","block_type":"box","text":"holder of the hybrid instrument is not required to make any payment to the issuer in addition to the purchase price","page_number":35,"box":{"x":69,"y":808,"width":817,"height":11}},{"id":"7e4e0139-a01b-45b2-99e7-02dd144c6b1c","block_type":"box","text":"paid under subparagraph (a), whether as margin, settlement payment, or otherwise, during the life of the hybrid","page_number":35,"box":{"x":70,"y":823,"width":793,"height":12}},{"id":"a20aed1f-4f88-4aba-997d-d13e8a947d6a","block_type":"box","text":"instrument or at maturity; (c) the issuer of the hybrid instrument is not subject by the terms of the instrument to","page_number":35,"box":{"x":70,"y":838,"width":798,"height":11}},{"id":"aa4089ad-fac3-4ba4-8022-9040241ebf8f","block_type":"box","text":"mark-to-market margining requirements; and (d) the hybrid instrument is not marketed as a contract of sale of a","page_number":35,"box":{"x":69,"y":853,"width":797,"height":12}},{"id":"7cba23f9-e660-46fb-a040-2724759bf5e3","block_type":"box","text":"commodity for future delivery (or option on such a contract) subject to applicable provisions of the Commodity","page_number":35,"box":{"x":69,"y":869,"width":783,"height":11}},{"id":"c1121f88-db5a-4b7b-8549-6f32072b0d12","block_type":"box","text":"Exchange Act. Hybrid instruments may be principal protected, par tially protected, or offer no principal protection. A","page_number":35,"box":{"x":70,"y":884,"width":816,"height":11}},{"id":"c9a1b286-02ab-4f12-a082-50de317a739f","block_type":"box","text":"principal protected hybrid instrument means that the issuer will pay, at a minimum, the par value of the note at","page_number":35,"box":{"x":70,"y":899,"width":791,"height":11}},{"id":"dcc5cae0-fd86-4d08-b3d3-c8b8612a9e30","block_type":"box","text":"II-4","page_number":35,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"c3f19982-8327-4aae-9612-d03b123a435f","block_type":"box","text":"NM1026U-5982568-35/232","page_number":35,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"7841458e-0f56-4233-b4f6-4815cd32b818","block_type":"box","text":"maturity. Therefore, if the commodity value to which the hybrid instrument is linked declines over the life of the note,","page_number":36,"box":{"x":69,"y":45,"width":829,"height":11}},{"id":"9beb204e-7631-4f7f-a19b-e3e9aaafab32","block_type":"box","text":"the Fund will receive at maturity the face or stated value of the note. With a principal protected hybrid instrument, the","page_number":36,"box":{"x":68,"y":60,"width":837,"height":11}},{"id":"34324730-a9e6-402d-aec5-071a44737cef","block_type":"box","text":"Fund will receive at maturity the greater of the par value of the note or the increase in its value based on the","page_number":36,"box":{"x":70,"y":75,"width":772,"height":11}},{"id":"e66e147a-8656-4fb3-918d-1ccad15d5942","block_type":"box","text":"underlying commodity or index. This protection is, in effect, an option whose value is subject to the volatility and price","page_number":36,"box":{"x":69,"y":90,"width":839,"height":11}},{"id":"7b44ff11-f321-457c-805a-6ad0d5071c96","block_type":"box","text":"level of the underlying commodity. The Manager’s decision whether to use principal protection depends in par t on the","page_number":36,"box":{"x":70,"y":105,"width":835,"height":11}},{"id":"d71b6c4b-2542-4797-8126-d937d0b292a0","block_type":"box","text":"cost of the protection. In addition, the protection feature depends upon the ability of the issuer to meet its obligation","page_number":36,"box":{"x":69,"y":120,"width":833,"height":12}},{"id":"4b97c0f0-5ac5-4505-988c-330ab02f9e4c","block_type":"box","text":"to buy back the security, and, therefore, depends on the creditwor thiness of the issuer. With full principal protection,","page_number":36,"box":{"x":68,"y":135,"width":831,"height":11}},{"id":"b8f7825d-486a-454a-b70d-e1d2f36a7f85","block_type":"box","text":"the Fund will receive at maturity of the hybrid instrument either the stated par value of the hybrid instrument, or","page_number":36,"box":{"x":68,"y":150,"width":795,"height":12}},{"id":"27f8db0b-50d1-4f30-94d2-e5c1eb1d0765","block_type":"box","text":"potentially, an amount greater than the stated par value if the underlying commodity, index, futures contract or","page_number":36,"box":{"x":70,"y":166,"width":784,"height":11}},{"id":"c83ed00c-b3b3-45e6-b27a-ff0939ab35ec","block_type":"box","text":"economic variable to which the hybrid instrument is linked has increased in value. Par tially protected hybrid","page_number":36,"box":{"x":69,"y":181,"width":765,"height":11}},{"id":"97613b1e-1c13-403a-a503-5d3b0018dc84","block_type":"box","text":"instruments may suffer some loss of principal if the underlying commodity, index, futures contract or economic","page_number":36,"box":{"x":70,"y":196,"width":788,"height":11}},{"id":"a2591a26-1dcc-4b34-91bb-aef9412df2de","block_type":"box","text":"variable to which the hybrid instrument is linked declines in value during the term of the hybrid instrument. However,","page_number":36,"box":{"x":68,"y":211,"width":828,"height":11}},{"id":"86e1b825-76f2-4a6d-8f0d-094f3d99644c","block_type":"box","text":"par tially protected hybrid instruments have a specified limit as to the amount of principal that they may lose.","page_number":36,"box":{"x":70,"y":226,"width":773,"height":11}},{"id":"a16f990e-8b83-40e9-9e63-6b8b9eb54eae","block_type":"box","text":"Hybrid Instruments Without Principal Protection.","page_number":36,"box":{"x":102,"y":249,"width":339,"height":11}},{"id":"bdd558b0-c34c-4778-934a-25bccd95835f","block_type":"box","text":"Cer tain Funds may invest in hybrid instruments that offer no","page_number":36,"box":{"x":448,"y":249,"width":429,"height":11}},{"id":"cd96567e-3e1e-4211-8d32-2d34d51c6e24","block_type":"box","text":"principal protection. At maturity, there is a risk that the underlying commodity price, futures contract, index or other","page_number":36,"box":{"x":70,"y":264,"width":818,"height":11}},{"id":"4f96401b-9b21-491c-a11f-31ae599ca1c5","block_type":"box","text":"economic variable may have declined sufficiently in value such that some or all of the face value of the hybrid","page_number":36,"box":{"x":69,"y":279,"width":780,"height":11}},{"id":"16a073cf-daf1-4140-93d9-a1e361569999","block_type":"box","text":"instrument might not be returned. The Manager, at its discretion, may invest in a par tially protected principal","page_number":36,"box":{"x":70,"y":294,"width":773,"height":11}},{"id":"2536ddae-e891-4c4c-83d0-a782677ed709","block_type":"box","text":"structured note or a note without principal protection. In deciding to purchase a note without principal protection, the","page_number":36,"box":{"x":69,"y":309,"width":832,"height":11}},{"id":"a78f4efa-dde8-40de-9bb3-82ad2fc0930d","block_type":"box","text":"Manager may consider, among other things, the expected per formance of the underlying commodity futures contract,","page_number":36,"box":{"x":70,"y":324,"width":831,"height":12}},{"id":"1a2449e8-0e36-4ccc-bf44-7932bb5f3b2a","block_type":"box","text":"index or other economic variable over the term of the note, the cost of the note, and any other economic factors that","page_number":36,"box":{"x":70,"y":339,"width":831,"height":12}},{"id":"2da024d5-81b9-4d71-9ef9-39ab82bed53c","block_type":"box","text":"the Manager believes are relevant.","page_number":36,"box":{"x":68,"y":355,"width":247,"height":11}},{"id":"f2023d01-bb91-47e0-b521-8234ad5bbc82","block_type":"box","text":"Limitations on Leverage.","page_number":36,"box":{"x":102,"y":377,"width":173,"height":12}},{"id":"aa745d73-10e9-4ec9-ba24-54f51febb97f","block_type":"box","text":"Some of the hybrid instruments in which a Fund may invest may involve leverage. To","page_number":36,"box":{"x":281,"y":377,"width":598,"height":12}},{"id":"d7a75102-e44c-448b-9177-977ae79c593d","block_type":"box","text":"avoid being subject to undue leverage risk, a Fund will seek to limit the amount of economic leverage it has under any","page_number":36,"box":{"x":69,"y":392,"width":840,"height":12}},{"id":"ed015f93-4487-433b-b994-afe7e7365325","block_type":"box","text":"one hybrid instrument that it buys and the leverage of the Fund’s overall por tfolio. A Fund will not invest in a hybrid","page_number":36,"box":{"x":69,"y":407,"width":816,"height":12}},{"id":"e6ea4839-9f80-4290-887f-0354c9a72e21","block_type":"box","text":"instrument if, at the time of purchase: (i) that instrument’s “leverage ratio” exceeds 300% of the price increase in","page_number":36,"box":{"x":70,"y":423,"width":812,"height":11}},{"id":"48891ff2-6589-48c5-bbd6-0f2b44569716","block_type":"box","text":"the underlying commodity, futures contract, index or other economic variable or (ii) the Fund’s “por tfolio leverage","page_number":36,"box":{"x":68,"y":438,"width":803,"height":11}},{"id":"c9cfec17-fda7-413a-9e4a-3353218c8d17","block_type":"box","text":"ratio” exceeds 150%, measured at the time of purchase. “Leverage ratio” is the expected increase in the value of a","page_number":36,"box":{"x":69,"y":453,"width":826,"height":11}},{"id":"922c5833-c30f-4bcf-b853-2947016af42c","block_type":"box","text":"hybrid instrument, assuming a one percent price increase in the underlying commodity, futures contract, index or","page_number":36,"box":{"x":69,"y":468,"width":803,"height":11}},{"id":"fc44f0b0-55b6-4b29-ae3d-8b8789fbdd32","block_type":"box","text":"other economic factor. In other words, for a hybrid instrument with a leverage factor of 150%, a 1% gain in the","page_number":36,"box":{"x":69,"y":483,"width":783,"height":11}},{"id":"9cbe894e-1261-4498-9b42-07f3507ed88b","block_type":"box","text":"underlying economic variable would be expected to result in a 1.5% gain in value for the hybrid instrument.","page_number":36,"box":{"x":69,"y":498,"width":758,"height":11}},{"id":"09e5bc46-0853-4595-bfe5-b0f4e83a4a7e","block_type":"box","text":"Conversely, a hybrid instrument with a leverage factor of 150% would suffer a 1.5% loss if the underlying economic","page_number":36,"box":{"x":69,"y":513,"width":818,"height":12}},{"id":"bd5849be-8b87-48ec-920b-2acaa8bdca00","block_type":"box","text":"variable lost 1% of its value. “Por tfolio leverage ratio” is defined as the average (mean) leverage ratio of all","page_number":36,"box":{"x":68,"y":528,"width":763,"height":12}},{"id":"ee9b5577-3414-4065-9aa5-23e7ab8b2b9a","block_type":"box","text":"instruments in a Fund’s por tfolio, weighted by the market values of such instruments or, in the case of futures","page_number":36,"box":{"x":70,"y":543,"width":787,"height":12}},{"id":"8a9fe1b3-e2ec-48be-9c46-f8e2d155849f","block_type":"box","text":"contracts, their notional values. A Fund may at times or from time to time decide not to use leverage in its","page_number":36,"box":{"x":69,"y":559,"width":757,"height":11}},{"id":"d0d6e738-015b-484a-bb68-6fe14f93eb01","block_type":"box","text":"investments or use less leverage than may otherwise be allowable.","page_number":36,"box":{"x":70,"y":574,"width":477,"height":11}},{"id":"98ec1162-2510-49c9-9ec0-329d5d7b6a4a","block_type":"box","text":"Counterpar ty Risk.","page_number":36,"box":{"x":102,"y":597,"width":130,"height":11}},{"id":"13167344-9f88-4f68-a662-35faa5c66ac8","block_type":"box","text":"A significant risk of hybrid instruments is counterpar ty risk. Unlike exchange-traded futures","page_number":36,"box":{"x":238,"y":596,"width":646,"height":12}},{"id":"d96f7c14-a7b6-429f-9c28-9482add9deba","block_type":"box","text":"and options, which are standard contracts, hybrid instruments are customized securities, tailor-made by a specific","page_number":36,"box":{"x":69,"y":612,"width":813,"height":11}},{"id":"3d2f59f2-534e-42e6-88a9-8ffdcbffd055","block_type":"box","text":"issuer. With a listed futures or options contract, an investor’s counterpar ty is the exchange clearinghouse. Exchange","page_number":36,"box":{"x":70,"y":627,"width":829,"height":11}},{"id":"0567fa51-707d-4351-a790-d5bb8f415f17","block_type":"box","text":"clearinghouses are capitalized by the exchange members and typically have high investment grade ratings (","page_number":36,"box":{"x":69,"y":642,"width":763,"height":11}},{"id":"428db226-1674-4831-805c-1ff162926261","block_type":"box","text":"e.g.","page_number":36,"box":{"x":834,"y":643,"width":25,"height":10}},{"id":"4177bf6d-0d06-408c-9c6e-97d50603111c","block_type":"box","text":",","page_number":36,"box":{"x":861,"y":649,"width":2,"height":3}},{"id":"5fb26247-709a-4ee8-94fe-3f70374b8ccb","block_type":"box","text":"ratings of AAA or AA by S&P). Therefore, the risk is small that an exchange clearinghouse might be unable to meet its","page_number":36,"box":{"x":69,"y":657,"width":836,"height":11}},{"id":"0f1166da-3772-422e-9549-39f132dacd06","block_type":"box","text":"obligations at maturity. However, with a hybrid instrument, a Fund will take on the counterpar ty credit risk of the","page_number":36,"box":{"x":69,"y":672,"width":795,"height":11}},{"id":"a1d3edd4-284b-46e3-8b08-8cef3179f94c","block_type":"box","text":"issuer. That is, at maturity of the hybrid instrument, there is a risk that the issuer may be unable to per form its","page_number":36,"box":{"x":70,"y":687,"width":791,"height":11}},{"id":"0ad87d0b-99b2-4bc0-a99b-033d474ce5e7","block_type":"box","text":"obligations under the structured note.","page_number":36,"box":{"x":69,"y":703,"width":268,"height":11}},{"id":"5ebd96d8-9845-4bbe-9901-e10a89dd0d6e","block_type":"box","text":"Convertible Securities.","page_number":36,"box":{"x":102,"y":725,"width":165,"height":9}},{"id":"43282dc7-b9c6-430d-90fb-61c3600ddb39","block_type":"box","text":"A conver tible security is a bond, debenture, note, preferred stock or other security that","page_number":36,"box":{"x":273,"y":725,"width":619,"height":11}},{"id":"0145c396-4a5f-499b-b198-e5203353f364","block_type":"box","text":"may be conver ted into or exchanged for a prescribed amount of common stock or other equity security of the same or","page_number":36,"box":{"x":69,"y":740,"width":839,"height":11}},{"id":"ea08749e-67bc-4f28-81e2-51cfe6ab92b2","block_type":"box","text":"a different issuer within a par ticular period of time at a specified price or formula. A conver tible security entitles the","page_number":36,"box":{"x":69,"y":755,"width":826,"height":11}},{"id":"c955e7aa-22ac-4553-80a1-4678549fdd7f","block_type":"box","text":"holder to receive interest paid or accrued on debt or the dividend paid on preferred stock until the conver tible","page_number":36,"box":{"x":69,"y":770,"width":781,"height":11}},{"id":"0e0dc714-b03a-433e-acd0-f989db449c6e","block_type":"box","text":"security matures or is redeemed, conver ted or exchanged. Before conversion, conver tible securities have","page_number":36,"box":{"x":69,"y":785,"width":750,"height":12}},{"id":"118fc711-d9df-4f4f-9e75-7ee0b524706e","block_type":"box","text":"characteristics similar to nonconver tible income securities in that they ordinarily provide a stable stream of income","page_number":36,"box":{"x":69,"y":801,"width":819,"height":11}},{"id":"a1ab6fa2-b01f-498c-af03-d00a68adda40","block_type":"box","text":"with generally higher yields than those of common stocks of the same or similar issuers, but lower yields than","page_number":36,"box":{"x":68,"y":816,"width":784,"height":11}},{"id":"052bec3b-c552-417f-a9c8-9f6f96cb2bec","block_type":"box","text":"comparable nonconver tible securities. The value of a conver tible security is influenced by changes in interest rates,","page_number":36,"box":{"x":69,"y":831,"width":823,"height":11}},{"id":"203c6cfd-4d63-4f7d-b829-59e90da74a12","block_type":"box","text":"with investment value declining as interest rates increase and increasing as interest rates decline. The credit","page_number":36,"box":{"x":68,"y":846,"width":780,"height":11}},{"id":"582ae6cf-2e17-4b08-8ba0-415accdc50e6","block_type":"box","text":"standing of the issuer and other factors also may have an effect on the conver tible security’s investment value.","page_number":36,"box":{"x":69,"y":861,"width":795,"height":11}},{"id":"85e0eb9f-8de9-4859-a2f1-3f271107e5d3","block_type":"box","text":"Conver tible securities rank senior to common stock in a corporation’s capital structure but are usually subordinated","page_number":36,"box":{"x":69,"y":876,"width":826,"height":11}},{"id":"cda250e2-a41a-4c23-8a25-4bce8ba16aa1","block_type":"box","text":"to comparable nonconver tible securities. Conver tible securities may be subject to redemption at the option of the","page_number":36,"box":{"x":68,"y":891,"width":811,"height":11}},{"id":"eb058b27-7308-45c7-b480-be52b66b68ce","block_type":"box","text":"issuer at a price established in the conver tible security’s governing instrument.","page_number":36,"box":{"x":70,"y":907,"width":563,"height":11}},{"id":"54f07abd-a44d-41ff-bfd8-d1d9f95c9f6f","block_type":"box","text":"II-5","page_number":36,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"88c3f1ac-9280-4b8f-9e31-6476abd8f6c2","block_type":"box","text":"NM1026U-5982568-36/232","page_number":36,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"f9987df9-5c7f-424e-8f9a-877e5efda885","block_type":"box","text":"The characteristics of conver tible securities make them potentially attractive investments for an investment","page_number":37,"box":{"x":101,"y":45,"width":767,"height":11}},{"id":"4acb0a64-f1ac-4a46-a1e7-8ba5d8a83a82","block_type":"box","text":"company seeking a high total return from capital appreciation and investment income. These characteristics include","page_number":37,"box":{"x":69,"y":60,"width":826,"height":11}},{"id":"8ece3003-711b-4e5b-a089-782849f6de79","block_type":"box","text":"the potential for capital appreciation as the value of the underlying common stock increases, the relatively high yield","page_number":37,"box":{"x":68,"y":75,"width":829,"height":11}},{"id":"3b54409f-1498-469e-8061-f75ab93f2edf","block_type":"box","text":"received from dividend or interest payments as compared to common stock dividends and decreased risks of decline","page_number":37,"box":{"x":69,"y":90,"width":834,"height":11}},{"id":"ffb5e0b0-e529-4fb3-b379-be820dfa11ba","block_type":"box","text":"in value relative to the underlying common stock due to their fixed-income nature. As a result of the conversion","page_number":37,"box":{"x":70,"y":105,"width":788,"height":11}},{"id":"a503d495-7ecf-4b7f-9bfa-c96c9be73ead","block_type":"box","text":"feature, however, the interest rate or dividend preference on a conver tible security is generally less than would be the","page_number":37,"box":{"x":68,"y":120,"width":839,"height":12}},{"id":"557247b8-c35b-4362-88ce-6183bf9fdfb5","block_type":"box","text":"case if the securities were issued in nonconver tible form.","page_number":37,"box":{"x":69,"y":135,"width":409,"height":9}},{"id":"a14d2118-c213-49c1-8891-ccebeeae3416","block_type":"box","text":"In analyzing conver tible securities, the Manager will consider both the yield on the conver tible security relative to","page_number":37,"box":{"x":102,"y":158,"width":802,"height":11}},{"id":"58c3e255-e825-4bd8-a86c-227672600aeb","block_type":"box","text":"its credit quality and the potential capital appreciation that is offered by the underlying common stock, among other","page_number":37,"box":{"x":70,"y":173,"width":824,"height":11}},{"id":"346bf493-efc6-447b-86b4-b7c983e72875","block_type":"box","text":"things.","page_number":37,"box":{"x":68,"y":188,"width":47,"height":12}},{"id":"dba60672-5097-4fa4-9cce-df28d43dde17","block_type":"box","text":"Conver tible securities are issued and traded in a number of securities markets. Even in cases where a","page_number":37,"box":{"x":102,"y":211,"width":731,"height":9}},{"id":"21051921-cb81-44e9-a74c-d264cd33bf43","block_type":"box","text":"substantial por tion of the conver tible securities held by a Fund are denominated in U.S. dollars, the underlying equity","page_number":37,"box":{"x":69,"y":226,"width":836,"height":11}},{"id":"d09ee8b4-84ea-4b08-8862-db96664cb0d4","block_type":"box","text":"securities may be quoted in the currency of the country where the issuer is domiciled. As a result, fluctuations in the","page_number":37,"box":{"x":69,"y":241,"width":832,"height":11}},{"id":"6754849c-2e0f-4a36-9f83-129d1121c38d","block_type":"box","text":"exchange rate between the currency in which the debt security is denominated and the currency in which the share","page_number":37,"box":{"x":69,"y":257,"width":818,"height":11}},{"id":"fe572dad-bd14-4878-9d2e-1948e6f6a587","block_type":"box","text":"price is quoted will affect the value of the conver tible security. With respect to conver tible securities denominated in","page_number":37,"box":{"x":70,"y":271,"width":828,"height":12}},{"id":"de2600e1-7f92-4744-ae1e-4724803fb467","block_type":"box","text":"a currency different from that of the underlying equity securities, the conversion price may be based on a fixed","page_number":37,"box":{"x":69,"y":286,"width":786,"height":12}},{"id":"42235aa5-ec30-479b-a479-357a6e6deecd","block_type":"box","text":"exchange rate established at the time the security is issued, which may increase the effects of currency risk. As","page_number":37,"box":{"x":69,"y":302,"width":800,"height":11}},{"id":"8730edc5-fe64-4ca9-8637-45c8d4110a58","block_type":"box","text":"described below, a Fund is authorized to enter into foreign currency hedging transactions in which it may seek to","page_number":37,"box":{"x":69,"y":317,"width":800,"height":11}},{"id":"5af142a0-3a95-4d92-ab84-8b37c1c97178","block_type":"box","text":"reduce the effect of exchange rate fluctuations.","page_number":37,"box":{"x":69,"y":332,"width":337,"height":11}},{"id":"ac924c7c-8e93-41c0-81b7-b0cb76a9bbcc","block_type":"box","text":"Apar t from currency considerations, the value of conver tible securities is influenced by both the yield on","page_number":37,"box":{"x":101,"y":355,"width":741,"height":11}},{"id":"b3df948f-25a8-4b29-858a-2a3249429bf4","block_type":"box","text":"nonconver tible securities of comparable issuers and by the value of the underlying common stock. The value of a","page_number":37,"box":{"x":69,"y":370,"width":806,"height":11}},{"id":"84783437-c493-4638-834b-63de6a53cdde","block_type":"box","text":"conver tible security viewed without regard to its conversion feature (","page_number":37,"box":{"x":69,"y":385,"width":485,"height":11}},{"id":"b51aa4a8-53be-4663-a04c-3bcc48ee1f91","block_type":"box","text":"i.e.","page_number":37,"box":{"x":557,"y":385,"width":20,"height":9}},{"id":"0f539dbb-d0ae-4287-934d-54d17d10097f","block_type":"box","text":", strictly on the basis of its yield) is","page_number":37,"box":{"x":579,"y":385,"width":248,"height":11}},{"id":"0060fff4-c3c7-433c-8a38-d5b77f03f2af","block_type":"box","text":"sometimes referred to as its “investment value.” To the extent interest rates change, the investment value of the","page_number":37,"box":{"x":69,"y":400,"width":808,"height":11}},{"id":"6f19b6cc-8337-440c-a53c-3e54b24aa4f1","block_type":"box","text":"conver tible security typically will fluctuate. At the same time, however, the value of the conver tible security will be","page_number":37,"box":{"x":69,"y":415,"width":807,"height":11}},{"id":"4638c137-14cf-4123-990a-4bcb4f6d1961","block_type":"box","text":"influenced by its “conversion value,” which is the market value of the underlying common stock that would be","page_number":37,"box":{"x":70,"y":430,"width":778,"height":11}},{"id":"b01e9480-c4ee-4a7f-878f-424ee690c6e8","block_type":"box","text":"obtained if the conver tible security were conver ted. Conversion value fluctuates directly with the price of the","page_number":37,"box":{"x":69,"y":445,"width":769,"height":11}},{"id":"2968942a-5517-4679-9df2-11abcad85286","block_type":"box","text":"underlying common stock. If the conversion value of a conver tible security is substantially below its investment value,","page_number":37,"box":{"x":69,"y":460,"width":837,"height":12}},{"id":"17d2a2c1-7501-4061-acac-9e19e369ed17","block_type":"box","text":"the price of the conver tible security is governed principally by its investment value. To the extent the conversion value","page_number":37,"box":{"x":68,"y":475,"width":837,"height":12}},{"id":"cdeb1b2b-7134-4972-a2ab-7b5b7d4543ae","block_type":"box","text":"of a conver tible security increases to a point that approximates or exceeds its investment value, the price of the","page_number":37,"box":{"x":69,"y":491,"width":800,"height":11}},{"id":"90e4fb44-0974-4bac-b3a7-60df758f08ed","block_type":"box","text":"conver tible security will be influenced principally by its conversion value. A conver tible security will sell at a premium","page_number":37,"box":{"x":69,"y":506,"width":828,"height":11}},{"id":"1991d75f-4b02-4c89-846e-f7e3ba7147f8","block_type":"box","text":"over the conversion value to the extent investors place value on the right to acquire the underlying common stock","page_number":37,"box":{"x":69,"y":521,"width":808,"height":11}},{"id":"17b4601a-22e8-4274-b200-efac7e0e9b98","block_type":"box","text":"while holding a fixed-income security. The yield and conversion premium of conver tible securities issued in Japan and","page_number":37,"box":{"x":68,"y":536,"width":835,"height":11}},{"id":"46898229-a3e8-46fd-a9b2-44868fec5b66","block_type":"box","text":"the Euromarket are frequently determined at levels that cause the conversion value to affect their market value more","page_number":37,"box":{"x":68,"y":551,"width":836,"height":11}},{"id":"10ebbe23-02b2-44f8-a89e-55806092a6d1","block_type":"box","text":"than the securities’ investment value.","page_number":37,"box":{"x":68,"y":566,"width":268,"height":9}},{"id":"9f208ce0-979a-4bff-923f-782c0fd2d567","block_type":"box","text":"Holders of conver tible securities generally have a claim on the assets of the issuer prior to the common","page_number":37,"box":{"x":102,"y":589,"width":740,"height":11}},{"id":"8205c5ae-e946-40d0-b595-ab0543bab005","block_type":"box","text":"stockholders but may be subordinated to other debt securities of the same issuer. A conver tible security may be","page_number":37,"box":{"x":69,"y":604,"width":801,"height":11}},{"id":"ba790baf-0399-45ed-abd7-c8c15bb1353f","block_type":"box","text":"subject to redemption at the option of the issuer at a price established in a char ter provision, indenture or other","page_number":37,"box":{"x":69,"y":619,"width":800,"height":11}},{"id":"a6d868c8-68ad-45b6-818e-8f0e97043b28","block_type":"box","text":"governing instrument pursuant to which the conver tible security was issued. If a conver tible security held by a Fund is","page_number":37,"box":{"x":68,"y":634,"width":840,"height":12}},{"id":"ecb89dea-1d84-4b9e-a36b-efb2e2cc2755","block_type":"box","text":"called for redemption, the Fund will be required to redeem the security, conver t it into the underlying common stock","page_number":37,"box":{"x":69,"y":649,"width":823,"height":12}},{"id":"2d7b8bcd-22c6-4a59-a8cf-bb86104de757","block_type":"box","text":"or sell it to a third par ty. Cer tain conver tible debt securities may provide a put option to the holder, which entitles the","page_number":37,"box":{"x":69,"y":665,"width":835,"height":11}},{"id":"9bdebfee-8313-4ade-a06b-9d123dcd588e","block_type":"box","text":"holder to cause the security to be redeemed by the issuer at a premium over the stated principal amount of the debt","page_number":37,"box":{"x":69,"y":680,"width":832,"height":11}},{"id":"2eb7d565-83ad-40f9-8d36-04b3a094efaf","block_type":"box","text":"security under cer tain circumstances.","page_number":37,"box":{"x":69,"y":695,"width":267,"height":11}},{"id":"13119123-0f32-48a8-aadf-b5e0557a45a2","block_type":"box","text":"A Fund may also invest in synthetic conver tible securities. Synthetic conver tible securities may include either","page_number":37,"box":{"x":101,"y":718,"width":777,"height":11}},{"id":"fe9fa74f-f05f-4519-adbe-59c16a7ddf3c","block_type":"box","text":"Cash-Settled Conver tibles or Manufactured Conver tibles. “Cash-Settled Conver tibles” are instruments that are","page_number":37,"box":{"x":69,"y":732,"width":789,"height":10}},{"id":"f35cc7c5-b613-4a29-82d9-eae3e969f83e","block_type":"box","text":"created by the issuer and have the economic characteristics of traditional conver tible securities but may not actually","page_number":37,"box":{"x":69,"y":748,"width":831,"height":11}},{"id":"0247c873-312b-4d9d-a768-1a9ebb59a3bb","block_type":"box","text":"permit conversion into the underlying equity securities in all circumstances. As an example, a private company may","page_number":37,"box":{"x":70,"y":763,"width":819,"height":11}},{"id":"3b22f8b9-f108-4939-8ead-8f60dbf61011","block_type":"box","text":"issue a Cash-Settled Conver tible that is conver tible into common stock only if the company successfully completes a","page_number":37,"box":{"x":70,"y":778,"width":833,"height":11}},{"id":"c1e6afd8-4e04-46a8-b32f-dbf183ddf791","block_type":"box","text":"public offering of its common stock prior to maturity and otherwise pays a cash amount to reflect any equity","page_number":37,"box":{"x":70,"y":793,"width":769,"height":11}},{"id":"3ecf05e0-2241-450b-a37c-9a0e4c80c75c","block_type":"box","text":"appreciation. “Manufactured Conver tibles” are created by the Manager or another par ty by combining separate","page_number":37,"box":{"x":69,"y":808,"width":791,"height":11}},{"id":"54c96c3b-1543-4a67-9a10-a430d73dc984","block_type":"box","text":"securities that possess one of the two principal characteristics of a conver tible security,","page_number":37,"box":{"x":69,"y":823,"width":627,"height":11}},{"id":"55eb852f-2822-402a-9013-0ec58fa30a1c","block_type":"box","text":"i.e.","page_number":37,"box":{"x":703,"y":823,"width":20,"height":9}},{"id":"ef19e4a3-ead1-4020-b95e-564ff8430058","block_type":"box","text":", fixed-income (“fixed","page_number":37,"box":{"x":726,"y":823,"width":151,"height":11}},{"id":"d780783c-fbce-4447-8f71-1adf07eb6993","block_type":"box","text":"income component”) or a right to acquire equity securities (“conver tibility component”). The fixed-income component","page_number":37,"box":{"x":70,"y":838,"width":830,"height":12}},{"id":"ca0fd2f7-6d59-4a98-a694-8ec9581ca3b6","block_type":"box","text":"is achieved by investing in nonconver tible fixed-income securities, such as nonconver tible bonds, preferred stocks","page_number":37,"box":{"x":70,"y":853,"width":814,"height":12}},{"id":"cb3e7529-efdb-49fc-ab54-ac4d4bdb3d17","block_type":"box","text":"and money market instruments. The conver tibility component is achieved by investing in call options, warrants, or","page_number":37,"box":{"x":69,"y":869,"width":811,"height":11}},{"id":"0fa65839-e331-4275-9728-d6deb7c1f1ae","block_type":"box","text":"other securities with equity conversion features (“equity features”) granting the holder the right to purchase a","page_number":37,"box":{"x":69,"y":884,"width":779,"height":11}},{"id":"2e2fe6a8-1548-44e5-80f2-1a23e211e592","block_type":"box","text":"II-6","page_number":37,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"70a3aee7-765f-49c0-87ae-78b207b5fe4d","block_type":"box","text":"NM1026U-5982568-37/232","page_number":37,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"4936d15e-750e-47eb-b83c-2eb088f90f4e","block_type":"box","text":"specified quantity of the underlying stocks within a specified period of time at a specified price or, in the case of a","page_number":38,"box":{"x":69,"y":45,"width":813,"height":11}},{"id":"114cc4e4-8c20-4e7d-a763-fd9c2f9a907b","block_type":"box","text":"stock index option, the right to receive a cash payment based on the value of the underlying stock index.","page_number":38,"box":{"x":69,"y":60,"width":744,"height":11}},{"id":"663fe3a4-94d9-4b08-a7d7-078cea7bd126","block_type":"box","text":"A Manufactured Conver tible differs from traditional conver tible securities in several respects. Unlike a traditional","page_number":38,"box":{"x":101,"y":82,"width":804,"height":11}},{"id":"abb76f65-fd6e-435e-94ec-281d838cdf31","block_type":"box","text":"conver tible security, which is a single security that has a unitary market value, a Manufactured Conver tible is","page_number":38,"box":{"x":69,"y":98,"width":777,"height":11}},{"id":"503ef8c6-60bb-481c-854b-fcb108e99a9f","block_type":"box","text":"comprised of two or more separate securities, each with its own market value. Therefore, the total “market value” of","page_number":38,"box":{"x":69,"y":113,"width":832,"height":11}},{"id":"2a0d48e4-fd98-4bd7-896f-ae817709dbca","block_type":"box","text":"such a Manufactured Conver tible is the sum of the values of its fixed-income component and its conver tibility","page_number":38,"box":{"x":69,"y":128,"width":781,"height":11}},{"id":"742bf388-57f6-4c4a-83bc-57ef471bbea6","block_type":"box","text":"component.","page_number":38,"box":{"x":69,"y":144,"width":82,"height":10}},{"id":"749053fe-95db-4038-9c6b-b9c2e48af57a","block_type":"box","text":"More flexibility is possible in the creation of a Manufactured Conver tible than in the purchase of a traditional","page_number":38,"box":{"x":102,"y":166,"width":773,"height":11}},{"id":"7974b8f0-c499-4bc6-ad32-657e3eb7d69d","block_type":"box","text":"conver tible security. Because many corporations have not issued conver tible securities, the Manager may combine a","page_number":38,"box":{"x":69,"y":181,"width":833,"height":11}},{"id":"407c09d9-a881-43cf-b753-2e34d68ccaf7","block_type":"box","text":"fixed-income instrument and an equity feature with respect to the stock of the issuer of the fixed-income instrument","page_number":38,"box":{"x":68,"y":196,"width":826,"height":11}},{"id":"dfed77ad-ce22-46fe-a128-003d6caef58b","block_type":"box","text":"to create a synthetic conver tible security otherwise unavailable in the market. The Manager may also combine a","page_number":38,"box":{"x":68,"y":211,"width":800,"height":11}},{"id":"2ab4c7b0-2f40-4d2c-b357-62d62fc75f01","block_type":"box","text":"fixed-income instrument of an issuer with an equity feature with respect to the stock of a different issuer when the","page_number":38,"box":{"x":68,"y":226,"width":817,"height":11}},{"id":"d567c383-2034-40e7-a5e5-34fe38d99ddb","block_type":"box","text":"Manager believes such a Manufactured Conver tible would better promote a Fund’s objective than alternative","page_number":38,"box":{"x":70,"y":241,"width":772,"height":11}},{"id":"5ce05ab7-9c8a-4ca9-bb9e-e3afa3dac666","block_type":"box","text":"investments. For example, the Manager may combine an equity feature with respect to an issuer’s stock with a fixed","page_number":38,"box":{"x":70,"y":256,"width":833,"height":12}},{"id":"b800f484-8e76-4b2a-85c8-e9ebbb6ee817","block_type":"box","text":"income security of a different issuer in the same industry to diversify the Fund’s credit exposure, or with a U.S.","page_number":38,"box":{"x":70,"y":271,"width":790,"height":12}},{"id":"46783934-d48c-4257-8b29-a08e3afb6a84","block_type":"box","text":"Treasury instrument to create a Manufactured Conver tible with a higher credit profile than a traditional conver tible","page_number":38,"box":{"x":68,"y":286,"width":815,"height":12}},{"id":"72b1bf71-6414-4bc4-821e-028214fffa7e","block_type":"box","text":"security issued by that issuer. A Manufactured Conver tible also is a more flexible investment in that its two","page_number":38,"box":{"x":69,"y":302,"width":764,"height":11}},{"id":"0247f944-9625-4d49-85fd-26082ef917cb","block_type":"box","text":"components may be purchased separately and, upon purchasing the separate securities, “combined” to create a","page_number":38,"box":{"x":69,"y":317,"width":806,"height":11}},{"id":"43e8a304-5acf-421c-b734-68a1f92fabe8","block_type":"box","text":"Manufactured Conver tible. For example, the Fund may purchase a warrant for eventual inclusion in a Manufactured","page_number":38,"box":{"x":70,"y":332,"width":818,"height":11}},{"id":"e5d00907-f157-4339-931b-d6adb8b78586","block_type":"box","text":"Conver tible while postponing the purchase of a suitable bond to pair with the warrant pending development of more","page_number":38,"box":{"x":69,"y":347,"width":824,"height":11}},{"id":"7743f80b-b627-41a0-ba68-15ffd1f4ff99","block_type":"box","text":"favorable market conditions.","page_number":38,"box":{"x":68,"y":362,"width":202,"height":9}},{"id":"319b6bf8-d776-4208-8188-7ddfa4c98135","block_type":"box","text":"The value of a Manufactured Conver tible may respond to cer tain market fluctuations differently from a traditional","page_number":38,"box":{"x":101,"y":385,"width":805,"height":11}},{"id":"f95565d9-39ca-4fd5-85d3-54a48bed2cd3","block_type":"box","text":"conver tible security with similar characteristics. For example, in the event a Fund created a Manufactured Conver tible","page_number":38,"box":{"x":69,"y":400,"width":837,"height":11}},{"id":"a7f1fa17-390d-44b4-8cb7-f11cec0fcda5","block_type":"box","text":"by combining a shor t-term U.S. Treasury instrument and a call option on a stock, the Manufactured Conver tible would","page_number":38,"box":{"x":69,"y":415,"width":839,"height":11}},{"id":"baa51ba5-a878-4115-889c-5b6231228747","block_type":"box","text":"be expected to outper form a traditional conver tible of similar maturity that is conver tible into that stock during","page_number":38,"box":{"x":69,"y":430,"width":787,"height":11}},{"id":"a5a07a36-94ea-49af-b276-5088fcb7c2fc","block_type":"box","text":"periods when Treasury instruments outper form corporate fixed-income securities and underper form during periods","page_number":38,"box":{"x":70,"y":445,"width":815,"height":12}},{"id":"461ded0a-592f-484d-9248-250dd3917e7b","block_type":"box","text":"when corporate fixed-income securities outper form Treasury instruments.","page_number":38,"box":{"x":68,"y":460,"width":523,"height":12}},{"id":"7cd9ef0c-1107-4abc-a82a-d48ab16abbf0","block_type":"box","text":"Corporate Loans.","page_number":38,"box":{"x":102,"y":483,"width":123,"height":11}},{"id":"a01efaa9-362e-4b33-aa3f-47829946464d","block_type":"box","text":"Cer tain Funds may invest in corporate loans. Corporate loans are generally non-investment","page_number":38,"box":{"x":231,"y":483,"width":647,"height":11}},{"id":"2d45bbbe-71e5-4846-b0e2-b772711347b4","block_type":"box","text":"grade floating rate instruments. Usually, they are freely callable at the issuer’s option. Cer tain Funds may invest in","page_number":38,"box":{"x":68,"y":498,"width":817,"height":11}},{"id":"ec87fb40-c0bd-4e86-b139-a87e9172b11a","block_type":"box","text":"fixed and floating rate loans (“Loans”) arranged through private negotiations between a corporate borrower or a","page_number":38,"box":{"x":68,"y":513,"width":794,"height":12}},{"id":"cd12fc2e-0ebb-4356-b8bf-0e82907c5286","block_type":"box","text":"foreign sovereign entity and one or more financial institutions or institutional investors (“Lenders”). A Fund may invest","page_number":38,"box":{"x":68,"y":528,"width":841,"height":12}},{"id":"11023bee-2ef5-4204-b569-d9158113117b","block_type":"box","text":"in such Loans in the form of par ticipations in Loans (“Par ticipations”) and assignments of all or a por tion of Loans","page_number":38,"box":{"x":70,"y":543,"width":818,"height":12}},{"id":"cc791be2-0b62-457a-9dbc-da74ebc7cba8","block_type":"box","text":"from third par ties (“Assignments”). A Fund considers these investments to be investments in debt securities for","page_number":38,"box":{"x":68,"y":559,"width":801,"height":11}},{"id":"3c9ab16b-3106-4f44-a145-13cace1696b2","block_type":"box","text":"purposes of its investment policies. Par ticipations typically will result in the Fund having a contractual relationship","page_number":38,"box":{"x":70,"y":574,"width":811,"height":11}},{"id":"78f85e49-f38a-484e-aead-2b8da6da33e9","block_type":"box","text":"only with the Lender, not with the borrower. The Fund will have the right to receive payments of principal, interest and","page_number":38,"box":{"x":69,"y":589,"width":833,"height":11}},{"id":"a7d89697-f169-496f-bed6-4dfc9cec223f","block_type":"box","text":"any fees to which it is entitled only from the Lender selling the Par ticipation and only upon receipt by the Lender of","page_number":38,"box":{"x":69,"y":604,"width":817,"height":11}},{"id":"7de86b43-ff0c-4d10-baa6-d5d5933c940c","block_type":"box","text":"the payments from the borrower. In connection with purchasing Par ticipations, the Fund generally will have no right to","page_number":38,"box":{"x":68,"y":619,"width":836,"height":11}},{"id":"b40060ab-26ad-4c9d-89b5-663a0360bee0","block_type":"box","text":"enforce compliance by the borrower with the terms of the loan agreement relating to the Loans, nor any rights of set","page_number":38,"box":{"x":69,"y":634,"width":833,"height":12}},{"id":"9dba6aec-94b8-4895-9b00-6f51997823a0","block_type":"box","text":"off against the borrower, and the Fund may not benefit directly from any collateral suppor ting the Loan in which it has","page_number":38,"box":{"x":69,"y":649,"width":837,"height":12}},{"id":"29b4484f-c461-47b6-ab52-d4aa21487caa","block_type":"box","text":"purchased the Par ticipation. As a result, the Fund will assume the credit risk of both the borrower and the Lender","page_number":38,"box":{"x":70,"y":664,"width":809,"height":11}},{"id":"d3a74da8-66aa-49a3-a141-511334442f21","block_type":"box","text":"that is selling the Par ticipation. In the event of the insolvency of the Lender selling the Par ticipation, the Fund may be","page_number":38,"box":{"x":68,"y":680,"width":838,"height":11}},{"id":"0046b693-d6d7-42d6-b2b4-14db4f1b66c2","block_type":"box","text":"treated as a general creditor of the Lender and may not benefit from any set-off between the Lender and the","page_number":38,"box":{"x":68,"y":695,"width":772,"height":11}},{"id":"34c53acb-6cac-4efe-9a35-f74d3ec1de1e","block_type":"box","text":"borrower. The Fund will acquire Par ticipations only if the Lender interpositioned between the Fund and the borrower is","page_number":38,"box":{"x":69,"y":710,"width":837,"height":11}},{"id":"f60fa362-e628-4af0-8cce-301b2a403445","block_type":"box","text":"determined by the Fund’s manager to be creditwor thy. When the Fund purchases Assignments from Lenders, the","page_number":38,"box":{"x":69,"y":725,"width":804,"height":11}},{"id":"eaa33df9-c959-4e49-85c2-02db49143e38","block_type":"box","text":"Fund will acquire direct rights against the borrower on the Loan, and will not have exposure to a counterpar ty’s credit","page_number":38,"box":{"x":70,"y":740,"width":834,"height":11}},{"id":"a518634b-02a1-4598-b8ad-00ebf3d5529d","block_type":"box","text":"risk. The Funds may enter into Par ticipations and Assignments on a forward commitment or “when-issued” basis,","page_number":38,"box":{"x":69,"y":755,"width":809,"height":11}},{"id":"08d06b82-555a-4ce3-8144-1031f420b62a","block_type":"box","text":"whereby a Fund would agree to purchase a Par ticipation or Assignment at set terms in the future. For more","page_number":38,"box":{"x":68,"y":770,"width":764,"height":12}},{"id":"0c6d2831-7c8c-4cb0-b15e-aea87ce25fc6","block_type":"box","text":"information on forward commitments and when-issued securities, see “When-Issued Securities, Delayed Delivery","page_number":38,"box":{"x":70,"y":785,"width":805,"height":12}},{"id":"33592bc1-e860-47a4-b5ef-c0787c51fced","block_type":"box","text":"Securities and Forward Commitments” below.","page_number":38,"box":{"x":69,"y":801,"width":324,"height":9}},{"id":"773c6578-79c8-45bd-8872-1da731f1cc2a","block_type":"box","text":"A Fund may have difficulty disposing of Assignments and Par ticipations. In cer tain cases, the market for such","page_number":38,"box":{"x":101,"y":823,"width":782,"height":12}},{"id":"4b94c9d8-8130-40d4-8f58-def4abca781d","block_type":"box","text":"instruments may lack sufficient liquidity, and therefore the Fund anticipates that in such cases such instruments","page_number":38,"box":{"x":70,"y":838,"width":803,"height":11}},{"id":"1930f46e-8613-4e23-81d7-ca999ea815c0","block_type":"box","text":"could be sold only to a limited number of institutional investors. The lack of a sufficiently liquid secondary market","page_number":38,"box":{"x":69,"y":853,"width":809,"height":12}},{"id":"f40934ff-1284-406e-945b-06bb6c7b049c","block_type":"box","text":"may have an adverse impact on the value of such instruments and on the Fund’s ability to dispose of par ticular","page_number":38,"box":{"x":69,"y":869,"width":795,"height":11}},{"id":"41849ac5-d7d3-4952-9f0e-8b6b9f103479","block_type":"box","text":"Assignments or Par ticipations in response to a specific economic event, such as deterioration in the creditwor thiness","page_number":38,"box":{"x":68,"y":884,"width":841,"height":11}},{"id":"11b3726c-3701-4ef2-9d10-3137b45df165","block_type":"box","text":"of the borrower.","page_number":38,"box":{"x":69,"y":899,"width":111,"height":9}},{"id":"7db4f39d-3410-45c4-9cc2-91e1c3b73fa3","block_type":"box","text":"II-7","page_number":38,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"4d3bb7ad-a915-43f7-8620-94dc28560271","block_type":"box","text":"NM1026U-5982568-38/232","page_number":38,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"8c6e6c44-4302-4440-9b22-c0d25bd4561b","block_type":"box","text":"Leading financial institutions often act as agent for a broader group of Lenders, generally referred to as a","page_number":39,"box":{"x":102,"y":45,"width":750,"height":11}},{"id":"66ac762c-f7f1-4cc5-b9c9-6f5ae8b78283","block_type":"box","text":"syndicate. The syndicate’s agent arranges the loans, holds collateral and accepts payments of principal and interest.","page_number":39,"box":{"x":69,"y":60,"width":834,"height":11}},{"id":"f1be3e4a-e39d-40e6-a2e3-b81bb86e50e1","block_type":"box","text":"Failure by the syndicate agent to fulfill its obligations may delay or adversely affect receipt of payment by the Fund.","page_number":39,"box":{"x":70,"y":75,"width":816,"height":11}},{"id":"05074d43-4153-402c-bafc-5d29366c75f9","block_type":"box","text":"The Loans in which the Fund may invest are subject to the risk of loss of principal and income. Although","page_number":39,"box":{"x":101,"y":98,"width":740,"height":11}},{"id":"8a5cd32c-6508-48f5-bb94-da61c033c3c4","block_type":"box","text":"borrowers frequently provide collateral to secure repayment of these obligations they do not always do so. If they do","page_number":39,"box":{"x":69,"y":113,"width":827,"height":11}},{"id":"5e0ab954-f0e6-4b1e-a9d0-b8fa4c7fe215","block_type":"box","text":"provide collateral, the value of the collateral may not completely cover the borrower’s obligations at the time of a","page_number":39,"box":{"x":70,"y":128,"width":802,"height":11}},{"id":"3d0601b1-f306-45a2-9339-28fb9151466b","block_type":"box","text":"default. If a borrower files for protection from its creditors under the U.S. bankruptcy laws, these laws may limit a","page_number":39,"box":{"x":69,"y":143,"width":808,"height":11}},{"id":"3eeba369-c5ec-41d2-b82a-4a6591becddf","block_type":"box","text":"Fund’s rights to its collateral. In addition, the value of collateral may erode during a bankruptcy case. In the event of","page_number":39,"box":{"x":70,"y":158,"width":827,"height":11}},{"id":"3fd5cf3d-a53b-4c47-bd2d-7d00128f9f00","block_type":"box","text":"a bankruptcy, the holder of a Loan may not recover its principal, may experience a long delay in recovering its","page_number":39,"box":{"x":69,"y":173,"width":777,"height":11}},{"id":"f9d830a9-b81f-4dd5-9364-6a8995af54bd","block_type":"box","text":"investment and may not receive interest during the delay.","page_number":39,"box":{"x":70,"y":188,"width":406,"height":12}},{"id":"dc8fbb0b-1dc2-4d27-8e81-fe16aa42a02b","block_type":"box","text":"Transactions in corporate loans may settle on a delayed basis. As a result, the proceeds from the sale of","page_number":39,"box":{"x":101,"y":211,"width":752,"height":11}},{"id":"4e0e87dd-6329-4ef2-adf3-d204adeae037","block_type":"box","text":"corporate loans may not be readily available to make additional investments or to meet a Fund’s redemption","page_number":39,"box":{"x":69,"y":226,"width":773,"height":11}},{"id":"d7b5e5e8-e57f-4884-9e4c-ae4b784ed66d","block_type":"box","text":"obligations. To the extent the extended settlement process gives rise to shor t-term liquidity needs, a Fund may hold","page_number":39,"box":{"x":69,"y":241,"width":824,"height":11}},{"id":"d8282040-797f-44d2-a6c6-6e0027e180e0","block_type":"box","text":"additional cash, sell investments or temporarily borrow from banks and other lenders.","page_number":39,"box":{"x":69,"y":256,"width":610,"height":11}},{"id":"27218a32-f0e3-462f-9226-a93e1016e4b4","block_type":"box","text":"In cer tain circumstances, Loans may not be deemed to be securities under cer tain federal securities laws.","page_number":39,"box":{"x":102,"y":279,"width":759,"height":11}},{"id":"7c07b095-39df-4e53-8f2c-4a4bc19d76ab","block_type":"box","text":"Therefore, in the event of fraud or misrepresentation by a borrower or an arranger, Lenders and purchasers of","page_number":39,"box":{"x":68,"y":294,"width":784,"height":11}},{"id":"4c0a4a85-7681-45ee-b543-80136ea1e6af","block_type":"box","text":"interests in Loans, such as the Funds, may not have the protection of the anti-fraud provisions of the federal","page_number":39,"box":{"x":70,"y":309,"width":772,"height":11}},{"id":"51aa4dba-576e-42d3-82da-65b1a5a06373","block_type":"box","text":"securities laws as would otherwise be available for bonds or stocks. Instead, in such cases, par ties generally would","page_number":39,"box":{"x":69,"y":324,"width":827,"height":12}},{"id":"16a15654-5726-4da3-b707-a3e7cd396254","block_type":"box","text":"rely on the contractual provisions in the Loan agreement itself and common-law fraud protections under applicable","page_number":39,"box":{"x":69,"y":339,"width":815,"height":12}},{"id":"518d0d07-271f-43c0-b451-a3e375b65b4f","block_type":"box","text":"state law.","page_number":39,"box":{"x":69,"y":355,"width":67,"height":9}},{"id":"ccd6cdca-e235-4f6b-8964-80fab8a31c1c","block_type":"box","text":"Direct Lending.","page_number":39,"box":{"x":102,"y":377,"width":105,"height":12}},{"id":"8e3ef2df-58f7-4e3b-8d8e-bc00dbfcfee8","block_type":"box","text":"The Fund may act as the originator for direct loans and engage in direct lending. Direct loans","page_number":39,"box":{"x":213,"y":377,"width":660,"height":12}},{"id":"0b3434ce-2556-4349-ab5b-76a9f54b1d9d","block_type":"box","text":"between the Fund and a borrower may not be administered by an underwriter or agent bank. The Fund may provide","page_number":39,"box":{"x":69,"y":393,"width":817,"height":11}},{"id":"f9767a4b-997d-4a6b-820a-a68428cb2080","block_type":"box","text":"financing to commercial borrowers directly or through companies acquired (or created) and owned by or otherwise","page_number":39,"box":{"x":68,"y":407,"width":811,"height":12}},{"id":"37fa2409-59ea-402c-9683-f32a14e122f1","block_type":"box","text":"affiliated with the Fund. The terms of the direct loans are negotiated with borrowers in private transactions.","page_number":39,"box":{"x":69,"y":423,"width":764,"height":11}},{"id":"977ea847-2cfa-479a-ae7e-3d4b37eb8771","block_type":"box","text":"Fur thermore, a direct loan may be secured or unsecured.","page_number":39,"box":{"x":70,"y":438,"width":405,"height":11}},{"id":"db89a176-237f-412d-8c98-22826fe82bd3","block_type":"box","text":"In determining whether to make a direct loan, the Fund will rely primarily upon the creditwor thiness of the","page_number":39,"box":{"x":102,"y":460,"width":750,"height":12}},{"id":"0b8a089f-661b-407d-b2a0-43cb9e86595f","block_type":"box","text":"borrower and/or any collateral for payment of interest and repayment of principal. The risks associated with direct","page_number":39,"box":{"x":69,"y":475,"width":813,"height":12}},{"id":"ba9af875-c141-4e40-b0ce-873544499bc1","block_type":"box","text":"loans are substantially similar to those associated with investing in corporate loans. In making a direct loan, the Fund","page_number":39,"box":{"x":70,"y":491,"width":838,"height":11}},{"id":"cc7ff66a-6514-4816-8dbe-0ad1ed406239","block_type":"box","text":"is exposed to the risk that the borrower may default or become insolvent and, consequently, that the Fund will lose","page_number":39,"box":{"x":70,"y":506,"width":818,"height":11}},{"id":"b751be08-113d-434a-92df-cbec8a9ca797","block_type":"box","text":"money on the loan. Fur thermore, direct loans may subject the Fund to liquidity and interest rate risk and cer tain","page_number":39,"box":{"x":69,"y":521,"width":798,"height":11}},{"id":"0e3b9447-a103-4da2-a77e-8d73176584f8","block_type":"box","text":"direct loans may be deemed illiquid. Direct loans are not publicly traded and may not have a secondary market. The","page_number":39,"box":{"x":69,"y":536,"width":825,"height":11}},{"id":"03aad2a8-2069-4764-b64f-75ba7039f4c4","block_type":"box","text":"lack of a secondary market for direct loans may have an adverse impact on the ability of the Fund to dispose of a","page_number":39,"box":{"x":70,"y":551,"width":807,"height":11}},{"id":"b0fb175e-70e6-4b74-ad2a-4701101501de","block_type":"box","text":"direct loan and/or to value the direct loan.","page_number":39,"box":{"x":69,"y":566,"width":301,"height":11}},{"id":"9c9de692-9d5c-4f9b-8c12-5bf36c7b09d1","block_type":"box","text":"When engaging in direct lending, the Fund’s per formance may depend, in par t, on the ability of the Fund to","page_number":39,"box":{"x":101,"y":589,"width":762,"height":11}},{"id":"59def4d8-8fd7-4291-9314-abca7210ef2a","block_type":"box","text":"originate loans on advantageous terms. In originating loans, the Fund will compete with a broad spectrum of lenders.","page_number":39,"box":{"x":69,"y":604,"width":833,"height":11}},{"id":"71f992c4-673b-47c7-9f3f-845e1ab3588b","block_type":"box","text":"Increased competition for, or a diminishment in the available supply of, qualifying loans could result in lower yields on","page_number":39,"box":{"x":70,"y":619,"width":836,"height":11}},{"id":"18a0823f-afdb-40d7-8ca8-534c88e35dda","block_type":"box","text":"such loans, which could reduce Fund per formance.","page_number":39,"box":{"x":69,"y":634,"width":362,"height":11}},{"id":"fa9ab50a-93f9-4753-8788-5ff197ec5cb9","block_type":"box","text":"As par t of its lending activities, the Fund may originate loans to companies that are experiencing significant","page_number":39,"box":{"x":101,"y":657,"width":767,"height":11}},{"id":"88056d3a-bb1e-4a7b-a227-9ec1068c4354","block_type":"box","text":"financial or business difficulties, including companies involved in bankruptcy or other reorganization and liquidation","page_number":39,"box":{"x":68,"y":672,"width":821,"height":11}},{"id":"65f4acdc-a344-417f-8e82-5abefb390c7c","block_type":"box","text":"proceedings. Although the terms of such financing may result in significant financial returns to the Fund, they involve","page_number":39,"box":{"x":70,"y":687,"width":830,"height":11}},{"id":"cdce6b47-7114-4f46-b5b3-44b4f514bbf3","block_type":"box","text":"a substantial degree of risk. The level of analytical sophistication, both financial and legal, necessary for successful","page_number":39,"box":{"x":69,"y":702,"width":826,"height":12}},{"id":"2df7ba41-ce2b-4f4d-89b7-865326880512","block_type":"box","text":"financing to companies experiencing significant business and financial difficulties is unusually high.","page_number":39,"box":{"x":68,"y":717,"width":709,"height":12}},{"id":"2539c4c2-10b0-4f41-81c4-68a25ca4959b","block_type":"box","text":"Credit Linked Securities.","page_number":39,"box":{"x":102,"y":740,"width":179,"height":9}},{"id":"1cbc824d-97c4-46fd-8bcc-aed883985e1c","block_type":"box","text":"Among the income producing securities in which a Fund may invest are credit linked","page_number":39,"box":{"x":287,"y":740,"width":596,"height":11}},{"id":"3ce50fb3-391e-48f3-8ec4-81064260a6d3","block_type":"box","text":"securities, which are issued by a limited purpose trust or other vehicle that, in turn, invests in a derivative instrument","page_number":39,"box":{"x":69,"y":755,"width":837,"height":11}},{"id":"47cd748a-405e-47f6-9be7-182d9869943e","block_type":"box","text":"or basket of derivative instruments, such as credit default swaps, interest rate swaps and other securities, in order","page_number":39,"box":{"x":69,"y":770,"width":823,"height":11}},{"id":"0e7f32a4-5779-4b39-a975-e86df9c90847","block_type":"box","text":"to provide exposure to cer tain fixed-income markets. For instance, a Fund may invest in credit linked securities as a","page_number":39,"box":{"x":68,"y":785,"width":827,"height":12}},{"id":"fc32d56e-6b63-493a-80a7-a28080147c4d","block_type":"box","text":"cash management tool in order to gain exposure to a cer tain market and/or to remain fully invested when more","page_number":39,"box":{"x":69,"y":801,"width":795,"height":11}},{"id":"bf009c19-0cc4-46ef-ae17-f8f94d081ea0","block_type":"box","text":"traditional income producing securities are not available.","page_number":39,"box":{"x":68,"y":816,"width":404,"height":11}},{"id":"09a74a3d-785f-4307-8ac6-e9245b3ed67b","block_type":"box","text":"Like an investment in a bond, investments in these credit linked securities represent the right to receive periodic","page_number":39,"box":{"x":102,"y":839,"width":804,"height":11}},{"id":"39928d47-8ab9-4c2e-9e6e-bbe7efc41450","block_type":"box","text":"income payments (in the form of distributions) and payment of principal at the end of the term of the security.","page_number":39,"box":{"x":70,"y":853,"width":780,"height":12}},{"id":"7c6f2696-93ee-4d23-a42b-d4c575488710","block_type":"box","text":"However, these payments are conditioned on the issuer’s receipt of payments from, and the issuer’s potential","page_number":39,"box":{"x":102,"y":876,"width":785,"height":11}},{"id":"56dd8bce-874b-419c-b7f3-cde5129b7b64","block_type":"box","text":"obligations to, the counterpar ties to the derivative instruments and other securities in which the issuer invests. For","page_number":39,"box":{"x":69,"y":891,"width":821,"height":12}},{"id":"45787612-0c1c-44b2-8fcd-77ffaa583b62","block_type":"box","text":"instance, the issuer may sell one or more credit default swaps, under which the issuer would receive a stream of","page_number":39,"box":{"x":70,"y":906,"width":806,"height":12}},{"id":"5d1892bb-e238-4ce7-88ae-37aad5646da7","block_type":"box","text":"II-8","page_number":39,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"f6f3fab8-3b8a-4c63-868c-fe46bf870140","block_type":"box","text":"NM1026U-5982568-39/232","page_number":39,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"f1df5b34-442c-4359-8f31-3c2d78168e53","block_type":"box","text":"payments over the term of the swap agreements provided that no event of default has occurred with respect to the","page_number":40,"box":{"x":70,"y":45,"width":819,"height":11}},{"id":"83098b2b-f2a9-4e50-af56-59263ce0bfce","block_type":"box","text":"referenced debt obligation upon which the swap is based. If a default occurs, the stream of payments may stop and","page_number":40,"box":{"x":69,"y":60,"width":826,"height":11}},{"id":"3099671c-7af2-4542-bf9d-ff18b102c349","block_type":"box","text":"the issuer would be obligated to pay the counterpar ty the par (or other agreed upon value) of the referenced debt","page_number":40,"box":{"x":68,"y":75,"width":807,"height":11}},{"id":"b508a7cf-1985-40c9-ab5a-eb674a53d209","block_type":"box","text":"obligation. This, in turn, would reduce the amount of income and principal that a Fund would receive. A Fund’s","page_number":40,"box":{"x":69,"y":90,"width":783,"height":11}},{"id":"223a6787-9ce0-468d-88ef-b2c11f191537","block_type":"box","text":"investments in these instruments are indirectly subject to the risks associated with derivative instruments, including,","page_number":40,"box":{"x":70,"y":105,"width":833,"height":11}},{"id":"5ff7a2bd-9b81-4467-8688-aa6eb5fcb5e8","block_type":"box","text":"among others, credit risk, default or similar event risk, counterpar ty risk, interest rate risk, leverage risk and","page_number":40,"box":{"x":69,"y":120,"width":771,"height":12}},{"id":"953c8883-70ec-4cb1-a659-089d7afc80b6","block_type":"box","text":"management risk. It is also expected that the securities will be exempt from registration under the Securities Act.","page_number":40,"box":{"x":69,"y":135,"width":808,"height":12}},{"id":"3cbb955f-8ce8-4f2b-be04-58838adc3234","block_type":"box","text":"Accordingly, there may be no established trading market for the securities and they may constitute illiquid","page_number":40,"box":{"x":68,"y":150,"width":752,"height":12}},{"id":"a6b3dc41-d22c-41aa-ba6a-7a2bccf1c5b5","block_type":"box","text":"investments.","page_number":40,"box":{"x":70,"y":166,"width":89,"height":9}},{"id":"4b432a10-40b4-47ce-8dfa-89ce2c72da15","block_type":"box","text":"Debt Securities.","page_number":40,"box":{"x":102,"y":188,"width":116,"height":9}},{"id":"d156723e-dc77-478f-a75f-6df146c56f1d","block_type":"box","text":"Debt securities, such as bonds, involve credit risk. This is the risk that the issuer will not make","page_number":40,"box":{"x":225,"y":188,"width":677,"height":11}},{"id":"bc269c69-ffea-4757-8dd2-4ee181b82c0e","block_type":"box","text":"timely payments of principal and interest. The degree of credit risk depends on the issuer’s financial condition and on","page_number":40,"box":{"x":68,"y":203,"width":839,"height":12}},{"id":"962a2feb-222c-483b-96df-1dd516fcb659","block_type":"box","text":"the terms of the debt securities. Changes in an issuer’s credit rating or the market’s perception of an issuer’s","page_number":40,"box":{"x":68,"y":218,"width":787,"height":12}},{"id":"04a7b864-e466-482e-b4b0-5cb13fecb499","block_type":"box","text":"creditwor thiness may also affect the value of a Fund’s investment in that issuer. Credit risk is reduced to the extent","page_number":40,"box":{"x":69,"y":234,"width":828,"height":11}},{"id":"eb2744ab-6b6a-46f4-a0fc-beb1bbb29e3b","block_type":"box","text":"a Fund limits its debt investments to U.S. Government Securities.","page_number":40,"box":{"x":69,"y":249,"width":466,"height":9}},{"id":"61a97fe2-c398-458e-8eb2-9aeaaf8d9699","block_type":"box","text":"All debt securities, however, are subject to interest rate risk. This is the risk that the value of the security may","page_number":40,"box":{"x":101,"y":271,"width":784,"height":12}},{"id":"87babfe7-22f8-4483-b143-cda5d45f98da","block_type":"box","text":"fall when interest rates rise. If interest rates move sharply in a manner not anticipated by Fund management, a","page_number":40,"box":{"x":68,"y":286,"width":792,"height":12}},{"id":"a19452c9-529c-434e-9232-c9c9f9e4f271","block_type":"box","text":"Fund’s investments in debt securities could be adversely affected and the Fund could lose money. In general, the","page_number":40,"box":{"x":70,"y":302,"width":806,"height":11}},{"id":"00adab63-ea44-4bd3-b7fd-7a4dad491a21","block_type":"box","text":"market price of debt securities with longer maturities will go up or down more in response to changes in interest","page_number":40,"box":{"x":69,"y":317,"width":800,"height":11}},{"id":"7227fb6b-7103-4584-848e-930131ace283","block_type":"box","text":"rates than will the market price of shor ter-term debt securities.","page_number":40,"box":{"x":69,"y":332,"width":448,"height":11}},{"id":"9c1c6fca-1262-4d9c-8526-97cd6ea0be09","block_type":"box","text":"During periods of rising interest rates, the average life of cer tain fixed-income securities is extended because of","page_number":40,"box":{"x":102,"y":355,"width":798,"height":11}},{"id":"f0aeb00f-149b-485e-8f43-71f091c2cb52","block_type":"box","text":"slower than expected principal payments. This may lock in a below-market interest rate and extend the duration of","page_number":40,"box":{"x":69,"y":370,"width":813,"height":11}},{"id":"241ef0ad-f0ac-4f34-96e6-b9b0a1ca5999","block_type":"box","text":"these fixed-income securities, especially mor tgage-related securities, making them more sensitive to changes in","page_number":40,"box":{"x":68,"y":385,"width":801,"height":11}},{"id":"9bf8eacf-409d-4c17-a7f7-5e688a88d693","block_type":"box","text":"interest rates. As a result, in a period of rising interest rates, these securities may exhibit additional volatility and","page_number":40,"box":{"x":70,"y":400,"width":806,"height":11}},{"id":"07681236-f579-495e-a594-0e346e6e4102","block_type":"box","text":"lose value. This is known as extension risk.","page_number":40,"box":{"x":70,"y":415,"width":307,"height":9}},{"id":"456e01dd-a707-4b72-8589-788ade6188cc","block_type":"box","text":"The value of fixed-income securities in the Funds can be expected to vary inversely with changes in prevailing","page_number":40,"box":{"x":101,"y":438,"width":778,"height":11}},{"id":"0771e024-ae68-4241-a9b4-acff0f9f6c9c","block_type":"box","text":"interest rates. Fixed-income securities with longer maturities, which tend to produce higher yields, are subject to","page_number":40,"box":{"x":70,"y":453,"width":798,"height":11}},{"id":"3f647f55-e89a-48bc-a860-4e98b22fef3a","block_type":"box","text":"potentially greater capital appreciation and depreciation than securities with shor ter maturities. The Funds are not","page_number":40,"box":{"x":70,"y":468,"width":812,"height":11}},{"id":"acfa02f0-1b3d-42da-9997-a1e96f3ece88","block_type":"box","text":"restricted to any maximum or minimum time to maturity in purchasing individual por tfolio securities, and the average","page_number":40,"box":{"x":69,"y":483,"width":831,"height":11}},{"id":"462078db-6b3a-4122-8c57-e523da66fa3c","block_type":"box","text":"maturity of a Fund’s assets will vary.","page_number":40,"box":{"x":69,"y":498,"width":259,"height":11}},{"id":"ddef4447-ee30-4c3d-bc9e-65c358d54414","block_type":"box","text":"Floating and Variable Rate Securities","page_number":40,"box":{"x":102,"y":521,"width":260,"height":11}},{"id":"3fe34f25-c029-4cc0-8d9e-f7e0a14e8ae7","block_type":"box","text":". Cer tain Funds may invest in debt instruments that pay a variable coupon","page_number":40,"box":{"x":364,"y":521,"width":526,"height":11}},{"id":"ee671817-9dd9-453d-b66b-ce9849a5c3bc","block_type":"box","text":"rate. Securities with floating or variable interest rates can be less sensitive to interest rate changes than securities","page_number":40,"box":{"x":69,"y":536,"width":821,"height":11}},{"id":"6f8adf20-7c19-4973-9d65-b48bfc8ba147","block_type":"box","text":"with fixed interest rates, but may decline in value if their interest rates do not rise as much, or as quickly, as interest","page_number":40,"box":{"x":68,"y":551,"width":834,"height":11}},{"id":"675b516e-9a59-4bff-a282-b2abed71c3dc","block_type":"box","text":"rates in general. Conversely, floating rate securities will not generally increase in value if interest rates decline. The","page_number":40,"box":{"x":69,"y":566,"width":820,"height":11}},{"id":"8040e69e-66af-4a0e-9b4c-d6f8f26c0cd0","block_type":"box","text":"impact of interest rate changes on floating rate investments is typically mitigated by the periodic interest rate reset of","page_number":40,"box":{"x":70,"y":581,"width":838,"height":12}},{"id":"1aa3e9f3-04f8-4282-bcab-209d292304a0","block_type":"box","text":"the investments. Benchmark interest rates used for floating and variable rate securities may not accurately track","page_number":40,"box":{"x":68,"y":596,"width":804,"height":12}},{"id":"6b2647c3-33be-4212-96bf-7bad343ecd6b","block_type":"box","text":"market interest rates.","page_number":40,"box":{"x":69,"y":612,"width":153,"height":9}},{"id":"8c674717-9965-44b3-9bbd-de6f38e4b70f","block_type":"box","text":"Inflation-Indexed Bonds.","page_number":40,"box":{"x":102,"y":634,"width":169,"height":9}},{"id":"4678775f-dfb5-415d-a786-591bc230e98c","block_type":"box","text":"Cer tain Funds may invest in inflation-indexed bonds, which are fixed-income securities or","page_number":40,"box":{"x":278,"y":634,"width":632,"height":11}},{"id":"01132cbd-e551-4728-be1c-b94383be4a5c","block_type":"box","text":"other instruments whose principal value is periodically adjusted according to the rate of inflation. Two structures are","page_number":40,"box":{"x":69,"y":649,"width":828,"height":12}},{"id":"84f2cf95-7ad0-4a34-8dc0-8d1bcb909811","block_type":"box","text":"common. The U.S. Treasury and some other issuers use a structure that accrues inflation into the principal value of","page_number":40,"box":{"x":69,"y":664,"width":827,"height":12}},{"id":"5acf43b8-f41c-4298-8d6a-ea31bbdbf89b","block_type":"box","text":"the bond. Most other issuers pay out the Consumer Price Index (“CPI”) accruals as par t of a semi-annual coupon.","page_number":40,"box":{"x":68,"y":680,"width":810,"height":11}},{"id":"348ad831-6267-40b0-962b-564dd684a9f0","block_type":"box","text":"Inflation-indexed securities issued by the U.S. Treasury have maturities of five, ten or thir ty years, although it is","page_number":40,"box":{"x":102,"y":702,"width":792,"height":12}},{"id":"a0291af6-c684-4d03-89cc-ea7f944daff9","block_type":"box","text":"possible that securities with other maturities will be issued in the future. The U.S. Treasury securities pay interest on","page_number":40,"box":{"x":70,"y":717,"width":833,"height":12}},{"id":"8cc1a610-0c9c-424a-bf07-bf26210d7774","block_type":"box","text":"a semi-annual basis, equal to a fixed percentage of the inflation-adjusted principal amount. For example, if a Fund","page_number":40,"box":{"x":69,"y":732,"width":810,"height":12}},{"id":"65b59b6b-fee4-4889-a947-16d3ff41f322","block_type":"box","text":"purchased an inflation-indexed bond with a par value of $1,000 and a 3% real rate of return coupon (payable 1.5%","page_number":40,"box":{"x":70,"y":747,"width":814,"height":12}},{"id":"8140b215-b62f-4902-92fd-64447ecc699d","block_type":"box","text":"semi-annually), and inflation over the first six months was 1%, the mid-year par value of the bond would be $1,010","page_number":40,"box":{"x":69,"y":762,"width":816,"height":12}},{"id":"9e4dad9b-762f-4395-8905-0d32996c7673","block_type":"box","text":"and the first semi-annual interest payment would be $15.15 ($1,010 times 1.5%). If inflation during the second half","page_number":40,"box":{"x":69,"y":777,"width":828,"height":12}},{"id":"028c6e4d-8721-47e5-94e7-b03b718eda45","block_type":"box","text":"of the year resulted in the whole year’s inflation equaling 3%, the end-of-year par value of the bond would be $1,030","page_number":40,"box":{"x":69,"y":792,"width":828,"height":12}},{"id":"8da7d5b9-a13a-457e-8de4-9a9aafeb7b21","block_type":"box","text":"and the second semi-annual interest payment would be $15.45 ($1,030 times 1.5%).","page_number":40,"box":{"x":69,"y":807,"width":610,"height":12}},{"id":"185ee1c2-9a3b-45c5-9871-dcd29ac6919b","block_type":"box","text":"If the periodic adjustment rate measuring inflation falls, the principal value of inflation-indexed bonds will be","page_number":40,"box":{"x":102,"y":831,"width":767,"height":11}},{"id":"ab913516-999b-4610-9eb8-eed02a28d864","block_type":"box","text":"adjusted downward, and, consequently, the interest payable on these securities (calculated with respect to a smaller","page_number":40,"box":{"x":69,"y":846,"width":833,"height":11}},{"id":"a0d443a2-dc30-4584-904f-c97df68e8910","block_type":"box","text":"principal amount) will be reduced. Repayment of the original bond principal upon maturity (as adjusted for inflation) is","page_number":40,"box":{"x":70,"y":861,"width":834,"height":11}},{"id":"42127e77-14d4-48bb-9e29-cd14ec62e6dd","block_type":"box","text":"guaranteed in the case of U.S. Treasury inflation-indexed bonds, even during a period of deflation. However, the","page_number":40,"box":{"x":68,"y":876,"width":795,"height":11}},{"id":"b47d2339-6900-4def-9f3e-1bebee9ee8c7","block_type":"box","text":"current market value of the bonds is not guaranteed, and will fluctuate. Cer tain Funds may also invest in other","page_number":40,"box":{"x":69,"y":891,"width":788,"height":12}},{"id":"56c4c251-c93e-4b27-a700-cd4f0db4294c","block_type":"box","text":"inflation related bonds which may or may not provide a similar guarantee. If a guarantee of principal is not provided,","page_number":40,"box":{"x":70,"y":906,"width":823,"height":12}},{"id":"26d0a9ed-de02-4e6a-a2af-45be8b080705","block_type":"box","text":"II-9","page_number":40,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"16e32fbb-ab30-4347-ae6f-686850289b76","block_type":"box","text":"NM1026U-5982568-40/232","page_number":40,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"9609d943-d3a8-4ce9-9e20-187f206f79a7","block_type":"box","text":"the adjusted principal value of the bond repaid at maturity may be less than the original principal. In addition, if the","page_number":41,"box":{"x":68,"y":45,"width":821,"height":11}},{"id":"24ed9832-b732-4ad0-af67-a62ad651833f","block_type":"box","text":"Fund purchases inflation-indexed bonds offered by foreign issuers, the rate of inflation measured by the foreign","page_number":41,"box":{"x":70,"y":60,"width":792,"height":11}},{"id":"2e9976f8-4c6d-4b0b-82b5-058b47187287","block_type":"box","text":"inflation index may not be correlated to the rate of inflation in the United States.","page_number":41,"box":{"x":70,"y":75,"width":570,"height":11}},{"id":"1cc1ee54-9cff-4cd9-9f44-7b003c5039fe","block_type":"box","text":"The value of inflation-indexed bonds is expected to change in response to changes in real interest rates. Real","page_number":41,"box":{"x":101,"y":98,"width":780,"height":11}},{"id":"ffa4c19b-2819-4be2-a59e-af0b69b5f1b5","block_type":"box","text":"interest rates, in turn, are tied to the relationship between nominal interest rates and the rate of inflation. Therefore,","page_number":41,"box":{"x":70,"y":113,"width":831,"height":11}},{"id":"a0ab3588-538c-43dd-b359-79c6ddbc86be","block_type":"box","text":"if inflation were to rise at a faster rate than nominal interest rates, real interest rates might decline, leading to an","page_number":41,"box":{"x":70,"y":128,"width":808,"height":11}},{"id":"0c5f0e0a-9d58-4f3e-a93f-ae080ab6a2b2","block_type":"box","text":"increase in value of inflation-indexed bonds. In contrast, if nominal interest rates increased at a faster rate than","page_number":41,"box":{"x":70,"y":143,"width":796,"height":10}},{"id":"7e403c8f-c1da-4a9a-ac72-a93e5c526012","block_type":"box","text":"inflation, real interest rates might rise, leading to a decrease in value of inflation-indexed bonds. There can be no","page_number":41,"box":{"x":70,"y":158,"width":805,"height":11}},{"id":"dcad609d-9fc0-431b-9175-243951b3a715","block_type":"box","text":"assurance, however, that the value of inflation-indexed bonds will be directly correlated to changes in interest rates.","page_number":41,"box":{"x":69,"y":173,"width":824,"height":11}},{"id":"ee185786-1368-4fd7-a7d0-8272c6ccccc5","block_type":"box","text":"While these securities are expected to be protected from long-term inflationary trends, shor t-term increases in","page_number":41,"box":{"x":101,"y":196,"width":788,"height":11}},{"id":"82b9967d-03a2-45dc-9068-b7e918a1f22f","block_type":"box","text":"inflation may lead to a decline in value. If interest rates rise due to reasons other than inflation (for example, due to","page_number":41,"box":{"x":70,"y":211,"width":825,"height":11}},{"id":"8c70d962-67ba-4f86-bfbe-93f42d743e8c","block_type":"box","text":"changes in currency exchange rates), investors in these securities may not be protected to the extent that the","page_number":41,"box":{"x":69,"y":226,"width":784,"height":11}},{"id":"393653fb-276e-4c38-ad47-859b6d3f5d15","block_type":"box","text":"increase is not reflected in the bond’s inflation measure.","page_number":41,"box":{"x":70,"y":241,"width":403,"height":9}},{"id":"cd104d5e-78e2-4fbb-bb74-65e423641645","block_type":"box","text":"In general, the measure used to determine the periodic adjustment of U.S. inflation-indexed bonds is the","page_number":41,"box":{"x":102,"y":264,"width":746,"height":11}},{"id":"1f5c0530-5049-4c4e-885d-abc168cc0cee","block_type":"box","text":"Consumer Price Index for Urban Consumers (“CPI-U”), which is calculated monthly by the U.S. Bureau of Labor","page_number":41,"box":{"x":69,"y":279,"width":786,"height":11}},{"id":"49cd4d5f-e620-4cd4-9e01-7587aef9451e","block_type":"box","text":"Statistics. The CPI-U is a measurement of changes in the cost of living, made up of components such as housing,","page_number":41,"box":{"x":69,"y":294,"width":810,"height":11}},{"id":"4325e8b9-4682-4ca1-9b7a-14080e56df0e","block_type":"box","text":"food, transpor tation and energy. Inflation-indexed bonds issued by a foreign government are generally adjusted to","page_number":41,"box":{"x":68,"y":309,"width":809,"height":11}},{"id":"f22680bb-0eb7-4731-a072-59eb9c99fcd5","block_type":"box","text":"reflect a comparable inflation index, calculated by that government. There can be no assurance that the CPI-U or any","page_number":41,"box":{"x":69,"y":324,"width":830,"height":12}},{"id":"df67c303-6d84-48fc-9de4-b6787a716fa4","block_type":"box","text":"foreign inflation index will accurately measure the real rate of inflation in the prices of goods and services. Moreover,","page_number":41,"box":{"x":68,"y":339,"width":833,"height":12}},{"id":"4d205ec7-78c8-482c-8d11-099fd55941d9","block_type":"box","text":"there can be no assurance that the rate of inflation in a foreign country will be correlated to the rate of inflation in the","page_number":41,"box":{"x":68,"y":355,"width":840,"height":11}},{"id":"056111b7-29e1-401b-92a4-050a074dcf48","block_type":"box","text":"United States.","page_number":41,"box":{"x":70,"y":370,"width":99,"height":9}},{"id":"96e27fee-6794-4e44-9694-c386ca7e7e21","block_type":"box","text":"Any increase in the principal amount of an inflation-indexed bond will be considered taxable ordinary income,","page_number":41,"box":{"x":101,"y":392,"width":774,"height":12}},{"id":"7e8b59d4-69c5-4c3b-b0fe-e6b76cb05adc","block_type":"box","text":"even though investors do not receive their principal until maturity.","page_number":41,"box":{"x":69,"y":408,"width":464,"height":11}},{"id":"db775da4-2625-4cf8-8c02-c5d99dabb402","block_type":"box","text":"Investment Grade Debt Obligations.","page_number":41,"box":{"x":102,"y":430,"width":252,"height":11}},{"id":"4b62e2fd-68ec-4ad9-bc70-0bb84d30bb4f","block_type":"box","text":"Cer tain Funds may invest in “investment grade securities,” which are","page_number":41,"box":{"x":360,"y":430,"width":493,"height":11}},{"id":"56890f83-4c1d-4d65-b1a4-149a2a911b5a","block_type":"box","text":"securities rated in the four highest rating categories of an NRSRO or deemed to be of equivalent quality by a Fund’s","page_number":41,"box":{"x":69,"y":445,"width":823,"height":12}},{"id":"e775eaed-20b5-4be6-a151-1f93779916f9","block_type":"box","text":"Manager. Cer tain Funds may invest in debt securities rated Aaa by Moody’s or AAA by S&P. It should be noted that","page_number":41,"box":{"x":70,"y":460,"width":815,"height":12}},{"id":"602aa3cf-6b6c-431a-ac2d-816f72d4d436","block_type":"box","text":"debt obligations rated in the lowest of the top four ratings (","page_number":41,"box":{"x":69,"y":475,"width":420,"height":12}},{"id":"f27ea820-aa4c-4094-8d7c-dd39fb1403ab","block_type":"box","text":"i.e.","page_number":41,"box":{"x":492,"y":476,"width":20,"height":8}},{"id":"86be392e-c49e-415d-a0b8-cccfead3d63b","block_type":"box","text":", “Baa” by Moody’s or “BBB” by S&P) are considered","page_number":41,"box":{"x":514,"y":476,"width":377,"height":11}},{"id":"b9c98548-fd90-4130-a25b-6745d3866c2c","block_type":"box","text":"to have some speculative characteristics and are more sensitive to economic change than higher rated securities. If","page_number":41,"box":{"x":68,"y":491,"width":829,"height":11}},{"id":"9325b9ee-cab8-42ba-b8f5-3e9979882b1a","block_type":"box","text":"an investment grade security of a Fund is subsequently downgraded below investment grade, the Fund’s Manager will","page_number":41,"box":{"x":69,"y":506,"width":836,"height":11}},{"id":"9e051d01-e855-41f0-9372-da7bce688c03","block_type":"box","text":"consider such an event in determining whether the Fund should continue to hold the security. Subject to its","page_number":41,"box":{"x":69,"y":521,"width":763,"height":11}},{"id":"25278adf-a282-43e0-b4c5-87a9ffaafed1","block_type":"box","text":"investment strategies, there is no limit on the amount of such downgraded securities a Fund may hold.","page_number":41,"box":{"x":70,"y":536,"width":731,"height":11}},{"id":"e04cc28d-5cfa-4905-860b-4863b26fc8ec","block_type":"box","text":"See Appendix A to this SAI for a description of applicable securities ratings.","page_number":41,"box":{"x":102,"y":559,"width":536,"height":11}},{"id":"7e2723c5-d2c3-468f-ba1a-ddaf402542a5","block_type":"box","text":"High Yield Investments (“Junk Bonds”).","page_number":41,"box":{"x":102,"y":582,"width":278,"height":11}},{"id":"0097565e-6050-4a9a-85e7-234fd835ead9","block_type":"box","text":"Non-investment grade or “high yield” fixed-income or conver tible securities commonly known to investors as","page_number":41,"box":{"x":102,"y":604,"width":767,"height":11}},{"id":"996e3b9a-6fd5-4874-ba04-13bd414051c6","block_type":"box","text":"“junk bonds” are debt securities that are rated below investment grade by the major rating agencies or are securities","page_number":41,"box":{"x":70,"y":619,"width":834,"height":11}},{"id":"3d6073ca-5a80-4566-8733-1ff8dedf1c5c","block_type":"box","text":"that Fund management believes are of comparable quality. While generally providing greater income and oppor tunity","page_number":41,"box":{"x":68,"y":634,"width":828,"height":12}},{"id":"f9259355-7cd8-4e2a-abcc-619507a56d35","block_type":"box","text":"for gain, non-investment grade debt securities may be subject to greater risks than securities which have higher credit","page_number":41,"box":{"x":68,"y":649,"width":841,"height":12}},{"id":"704201ed-99e8-48b7-860b-84e321dcecad","block_type":"box","text":"ratings, including a high risk of default, and their yields will fluctuate over time. High yield securities will generally be","page_number":41,"box":{"x":69,"y":664,"width":827,"height":12}},{"id":"b0f8a3c3-17e8-4bff-b788-e19c736cb9d7","block_type":"box","text":"in the lower rating categories of recognized rating agencies (rated “Ba” or lower by Moody’s or “BB” or lower by S&P)","page_number":41,"box":{"x":70,"y":680,"width":830,"height":11}},{"id":"cd45247d-6a7c-4724-a392-b537af6f3d69","block_type":"box","text":"or will be non-rated. The credit rating of a high yield security does not necessarily address its market value risk, and","page_number":41,"box":{"x":69,"y":695,"width":824,"height":11}},{"id":"4952c286-e5e7-46ec-bf1b-65ee20397e9f","block_type":"box","text":"ratings may from time to time change, positively or negatively, to reflect developments regarding the issuer’s financial","page_number":41,"box":{"x":69,"y":710,"width":838,"height":11}},{"id":"bb74c8a7-d34b-4e52-9fb1-5819d7a202db","block_type":"box","text":"condition. High yield securities are considered to be speculative with respect to the capacity of the issuer to timely","page_number":41,"box":{"x":69,"y":725,"width":817,"height":11}},{"id":"d0be054c-158b-450b-90bd-e8ebe098fecc","block_type":"box","text":"repay principal and pay interest or dividends in accordance with the terms of the obligation and may have more credit","page_number":41,"box":{"x":69,"y":740,"width":837,"height":11}},{"id":"f3c24d8c-5c3c-439d-809f-67e15068ffad","block_type":"box","text":"risk than higher rated securities.","page_number":41,"box":{"x":69,"y":755,"width":230,"height":11}},{"id":"8d693156-cb30-4916-98e2-3a9683e69224","block_type":"box","text":"The major risks in junk bond investments include the following:","page_number":41,"box":{"x":101,"y":778,"width":447,"height":11}},{"id":"865dc64d-95a9-46f2-a424-7d996c3768e1","block_type":"box","text":"•","page_number":41,"box":{"x":69,"y":801,"width":6,"height":4}},{"id":"45036111-98c8-4bc6-b358-51e3cc86cd01","block_type":"box","text":"Junk bonds may be issued by less creditwor thy companies. These securities are vulnerable to adverse changes","page_number":41,"box":{"x":101,"y":798,"width":796,"height":11}},{"id":"1076097f-e386-4a9d-9dd4-3e710eaac1fd","block_type":"box","text":"in the issuer’s industry and to general economic conditions. Issuers of junk bonds may be unable to meet their","page_number":41,"box":{"x":102,"y":813,"width":792,"height":11}},{"id":"ea78a228-1b1e-41cd-9f7b-7500744c002a","block_type":"box","text":"interest or principal payment obligations because of an economic downturn, specific issuer developments or the","page_number":41,"box":{"x":102,"y":828,"width":799,"height":12}},{"id":"5dc51942-b631-43b0-8688-115eca2385e5","block_type":"box","text":"unavailability of additional financing.","page_number":41,"box":{"x":102,"y":843,"width":256,"height":12}},{"id":"c580c197-67e3-4836-bbdf-b813a59843ea","block_type":"box","text":"•","page_number":41,"box":{"x":69,"y":866,"width":6,"height":5}},{"id":"5d32feff-e1bf-4910-93c8-eccca12f4101","block_type":"box","text":"The issuers of junk bonds may have a larger amount of outstanding debt relative to their assets than issuers of","page_number":41,"box":{"x":101,"y":863,"width":797,"height":12}},{"id":"346aff48-7921-4c14-bcec-f3e72cb3a848","block_type":"box","text":"investment grade bonds. If the issuer experiences financial stress, it may be unable to meet its debt obligations.","page_number":41,"box":{"x":102,"y":879,"width":804,"height":11}},{"id":"62dc7434-07fc-431e-b6d5-295383c17f1c","block_type":"box","text":"The issuer’s ability to pay its debt obligations also may be lessened by specific issuer developments, or the","page_number":41,"box":{"x":101,"y":894,"width":769,"height":11}},{"id":"6e98d7ef-e872-430e-a564-fce7676f928c","block_type":"box","text":"II-10","page_number":41,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"5a38dce7-bad9-4d5d-874c-aac239ba10b9","block_type":"box","text":"NM1026U-5982568-41/232","page_number":41,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"eaa66411-c058-4936-9a57-9448f4c716c4","block_type":"box","text":"unavailability of additional financing. Issuers of high yield securities are often in the growth stage of their","page_number":42,"box":{"x":102,"y":45,"width":746,"height":11}},{"id":"aaace9da-f3f8-44c6-aa8e-66ba9404e4b3","block_type":"box","text":"development and/or involved in a reorganization or takeover.","page_number":42,"box":{"x":101,"y":60,"width":432,"height":11}},{"id":"9dbbb767-ab65-44ac-be0f-caf0e701fa3e","block_type":"box","text":"•","page_number":42,"box":{"x":69,"y":83,"width":6,"height":4}},{"id":"1221598b-033c-4d53-89a4-212236d060ad","block_type":"box","text":"Junk bonds are frequently ranked junior to claims by other creditors. If the issuer cannot meet its obligations, the","page_number":42,"box":{"x":101,"y":80,"width":808,"height":11}},{"id":"e82bab5b-41a2-482c-ae52-f74b46f45d1d","block_type":"box","text":"senior obligations are generally paid off before the junior obligations, which will potentially limit a Fund’s ability","page_number":42,"box":{"x":102,"y":95,"width":789,"height":11}},{"id":"c9d411f1-59f0-4cfa-8484-1e5c7a7afee9","block_type":"box","text":"to fully recover principal or to receive interest payments when senior securities are in default. Thus, investors in","page_number":42,"box":{"x":101,"y":110,"width":796,"height":11}},{"id":"fbfb4e10-a853-46be-85bb-a4acf7d2015d","block_type":"box","text":"high yield securities have a lower degree of protection with respect to principal and interest payments than do","page_number":42,"box":{"x":102,"y":125,"width":782,"height":12}},{"id":"207aa66d-1a61-410d-b0fb-164e9323c510","block_type":"box","text":"investors in higher rated securities.","page_number":42,"box":{"x":102,"y":141,"width":249,"height":11}},{"id":"537a445a-6695-4c99-a4c4-076e3d68dc94","block_type":"box","text":"•","page_number":42,"box":{"x":69,"y":163,"width":6,"height":5}},{"id":"d623ee0f-78e8-4523-bd6f-5670e64f2aaf","block_type":"box","text":"Junk bonds frequently have redemption features that permit an issuer to repurchase the security from a Fund","page_number":42,"box":{"x":101,"y":161,"width":780,"height":11}},{"id":"dc12724b-8ada-4445-a67c-9136e42cec47","block_type":"box","text":"before it matures. If an issuer redeems the junk bonds, a Fund may have to invest the proceeds in bonds with","page_number":42,"box":{"x":102,"y":176,"width":784,"height":11}},{"id":"22b6514f-dc37-47f4-9014-9a7db5284449","block_type":"box","text":"lower yields and may lose income.","page_number":42,"box":{"x":102,"y":191,"width":242,"height":11}},{"id":"154d19a5-16e9-4dc3-8807-402ed2f61c55","block_type":"box","text":"•","page_number":42,"box":{"x":69,"y":214,"width":6,"height":4}},{"id":"73f2d375-2703-4311-b7bd-e091e3b2192f","block_type":"box","text":"Prices of junk bonds are subject to extreme price fluctuations. Negative economic developments may have a","page_number":42,"box":{"x":102,"y":211,"width":772,"height":11}},{"id":"ecf323f1-7161-4b2c-87d4-c4b00a8b359c","block_type":"box","text":"greater impact on the prices of junk bonds than on those of other higher rated fixed-income securities.","page_number":42,"box":{"x":101,"y":226,"width":729,"height":11}},{"id":"ae97dc9c-a0d2-47fa-9474-5ece528b37bb","block_type":"box","text":"•","page_number":42,"box":{"x":69,"y":249,"width":6,"height":5}},{"id":"cd8d643a-2eee-450a-aea0-f688df32bf26","block_type":"box","text":"Junk bonds may be less liquid than higher rated fixed-income securities even under normal economic conditions.","page_number":42,"box":{"x":101,"y":246,"width":802,"height":11}},{"id":"d457a1d2-e95a-4c97-9b9d-95871ca14431","block_type":"box","text":"Under cer tain economic and/or market conditions, a Fund may have difficulty disposing of cer tain high yield","page_number":42,"box":{"x":102,"y":261,"width":768,"height":12}},{"id":"0c6b1d5e-721d-4e3d-b13a-eee4e20247cc","block_type":"box","text":"securities due to the limited number of investors in that sector of the market. There are fewer dealers in the junk","page_number":42,"box":{"x":102,"y":276,"width":805,"height":12}},{"id":"f4f8000d-55c4-4610-84f9-53cb072ff06c","block_type":"box","text":"bond market, and there may be significant differences in the prices quoted for junk bonds by the dealers, and","page_number":42,"box":{"x":102,"y":292,"width":781,"height":11}},{"id":"9f8d34c2-bcde-47eb-bb9d-ec3964eb776c","block_type":"box","text":"such quotations may not be the actual prices available for a purchase or sale. Because junk bonds are less","page_number":42,"box":{"x":102,"y":307,"width":767,"height":11}},{"id":"2fab1c50-dff9-480e-8f62-5f2a8d7edd70","block_type":"box","text":"liquid than higher rated bonds, judgment may play a greater role in valuing cer tain of a Fund’s por tfolio securities","page_number":42,"box":{"x":102,"y":322,"width":806,"height":11}},{"id":"5e7ff016-a107-42b4-bdc9-5776abeefd55","block_type":"box","text":"than in the case of securities trading in a more liquid market.","page_number":42,"box":{"x":101,"y":337,"width":436,"height":11}},{"id":"41bfc654-6949-43ed-a1eb-00ed56ec5ea2","block_type":"box","text":"•","page_number":42,"box":{"x":69,"y":360,"width":6,"height":5}},{"id":"16a0d19f-2bde-4fb2-ad66-7cd3fbc03d6c","block_type":"box","text":"The secondary markets for high yield securities are not as liquid as the secondary markets for higher rated","page_number":42,"box":{"x":101,"y":357,"width":763,"height":11}},{"id":"6694fbc5-6fb2-49d6-be24-b962e39aa4b8","block_type":"box","text":"securities. The secondary markets for high yield securities are concentrated in relatively few market makers and","page_number":42,"box":{"x":102,"y":372,"width":798,"height":11}},{"id":"95dba5d2-1c0b-4213-858d-69d4ff7acf81","block_type":"box","text":"par ticipants in the markets are mostly institutional investors, including insurance companies, banks, other","page_number":42,"box":{"x":102,"y":388,"width":759,"height":11}},{"id":"16f39d96-a958-43d6-a173-eed5b15ca608","block_type":"box","text":"financial institutions and mutual funds. In addition, the trading volume for high yield securities is generally lower","page_number":42,"box":{"x":101,"y":402,"width":798,"height":12}},{"id":"4398a678-f805-4e19-ba07-6ad996d78608","block_type":"box","text":"than that for higher rated securities and the secondary markets could contract under adverse market or","page_number":42,"box":{"x":101,"y":418,"width":739,"height":11}},{"id":"0d227256-84fc-48dd-89c9-a3778b045da0","block_type":"box","text":"economic conditions independent of any specific adverse changes in the condition of a par ticular issuer. Under","page_number":42,"box":{"x":101,"y":433,"width":792,"height":11}},{"id":"0ace4235-3801-4270-ae21-8a6e528f14ce","block_type":"box","text":"cer tain economic and/or market conditions, a Fund may have difficulty disposing of cer tain high yield securities","page_number":42,"box":{"x":101,"y":448,"width":797,"height":11}},{"id":"e8434996-964d-46c7-98f0-e3d2c530d24c","block_type":"box","text":"due to the limited number of investors in that sector of the market. An illiquid secondary market may adversely","page_number":42,"box":{"x":101,"y":463,"width":791,"height":11}},{"id":"38be4de0-a298-4b14-87be-a101794fa0e5","block_type":"box","text":"affect the market price of the high yield security, which may result in increased difficulty selling the par ticular","page_number":42,"box":{"x":102,"y":478,"width":777,"height":11}},{"id":"f4a8323e-73cf-4901-a3a8-c2eebf2244ee","block_type":"box","text":"issue and obtaining accurate market quotations on the issue when valuing a Fund’s assets. Market quotations","page_number":42,"box":{"x":102,"y":493,"width":788,"height":11}},{"id":"0cd5d17b-ae55-463b-afd1-b7c1ead9c3f6","block_type":"box","text":"on high yield securities are available only from a limited number of dealers, and such quotations may not be the","page_number":42,"box":{"x":102,"y":508,"width":797,"height":12}},{"id":"2fc7fadd-3e6f-4962-b619-28b8bcca51a8","block_type":"box","text":"actual prices available for a purchase or sale. When the secondary market for high yield securities becomes","page_number":42,"box":{"x":102,"y":523,"width":769,"height":12}},{"id":"5b9945d8-0e21-400a-8bf8-d523b481d347","block_type":"box","text":"more illiquid, or in the absence of readily available market quotations for such securities, the relative lack of","page_number":42,"box":{"x":102,"y":538,"width":772,"height":12}},{"id":"c64f1f14-de16-4b5c-b85e-19d414f7862e","block_type":"box","text":"reliable objective data makes it more difficult to value a Fund’s securities, and judgment plays a more impor tant","page_number":42,"box":{"x":102,"y":554,"width":801,"height":11}},{"id":"9878eab6-b21c-4dff-8864-c3b076054f68","block_type":"box","text":"role in determining such valuations.","page_number":42,"box":{"x":102,"y":569,"width":252,"height":11}},{"id":"11918679-63db-48a0-92dc-c3eaf2085298","block_type":"box","text":"•","page_number":42,"box":{"x":69,"y":592,"width":6,"height":4}},{"id":"9519cfd8-d342-4095-8b13-b51b4e3db0a4","block_type":"box","text":"A Fund may incur expenses to the extent necessary to seek recovery upon default or to negotiate new terms with","page_number":42,"box":{"x":101,"y":589,"width":808,"height":11}},{"id":"e780b84d-8240-41a2-bbde-f8fa520ebb1e","block_type":"box","text":"a defaulting issuer.","page_number":42,"box":{"x":102,"y":604,"width":134,"height":11}},{"id":"66b47f0d-ba27-4298-9231-e84dabbea3ba","block_type":"box","text":"•","page_number":42,"box":{"x":69,"y":627,"width":6,"height":5}},{"id":"15ba0631-e09d-4c5f-9f60-825053b600b4","block_type":"box","text":"The junk bond markets may react strongly to adverse news about an issuer or the economy, or to the perception","page_number":42,"box":{"x":101,"y":624,"width":800,"height":11}},{"id":"bb1b9114-c61f-4649-be87-8961a6e02a59","block_type":"box","text":"or expectation of adverse news, whether or not it is based on fundamental analysis. Additionally, prices for high","page_number":42,"box":{"x":102,"y":639,"width":793,"height":12}},{"id":"4f7cd622-9ecc-4750-9a18-f9580f479231","block_type":"box","text":"yield securities may be affected by legislative and regulatory developments. These developments could adversely","page_number":42,"box":{"x":101,"y":654,"width":808,"height":12}},{"id":"3c69a7c4-ee21-480d-aead-4e13fabf372a","block_type":"box","text":"affect a Fund’s NAV and investment practices, the secondary market for high yield securities, the financial","page_number":42,"box":{"x":102,"y":669,"width":756,"height":12}},{"id":"98b45b2b-72a4-486e-9225-44fd300b80d6","block_type":"box","text":"condition of issuers of these securities and the value and liquidity of outstanding high yield securities, especially","page_number":42,"box":{"x":101,"y":685,"width":803,"height":11}},{"id":"0acb6e01-66dd-4421-ad34-9bfe16feeae0","block_type":"box","text":"in a thinly traded market. For example, federal legislation requiring the divestiture by federally insured savings","page_number":42,"box":{"x":102,"y":700,"width":781,"height":11}},{"id":"81273585-7c40-4edd-8f64-22e9cc6d4122","block_type":"box","text":"and loan associations of their investments in high yield bonds and limiting the deductibility of interest by cer tain","page_number":42,"box":{"x":102,"y":715,"width":798,"height":11}},{"id":"6262dc09-eb64-4c65-b02e-f824c45aecd6","block_type":"box","text":"corporate issuers of high yield bonds adversely affected the market in the past.","page_number":42,"box":{"x":101,"y":730,"width":566,"height":11}},{"id":"579d0fd4-55cb-4864-960b-9fd969444c5e","block_type":"box","text":"•","page_number":42,"box":{"x":69,"y":753,"width":6,"height":5}},{"id":"b519c341-e4e0-44d8-9c7e-3a0404aa43c2","block_type":"box","text":"The rating assigned by a rating agency evaluates the issuing agency’s assessment of the safety of a non","page_number":42,"box":{"x":101,"y":750,"width":751,"height":11}},{"id":"18d8eba6-e68d-449d-aa16-6ab9af534444","block_type":"box","text":"investment grade security’s principal and interest payments, but does not address market value risk. Because","page_number":42,"box":{"x":102,"y":766,"width":786,"height":11}},{"id":"1f637528-54f6-4461-9ccd-24a9fcb8f7d2","block_type":"box","text":"such ratings of the ratings agencies may not always reflect current conditions and events, in addition to using","page_number":42,"box":{"x":102,"y":780,"width":782,"height":12}},{"id":"0c765d67-8db2-446e-8064-7689c1020da6","block_type":"box","text":"recognized rating agencies and other sources, the Manager or sub-adviser per forms its own analysis of the","page_number":42,"box":{"x":102,"y":795,"width":762,"height":12}},{"id":"3831f4b3-dee4-41b5-b90a-7d7724908cb1","block_type":"box","text":"issuers whose non-investment grade securities a Fund holds. Because of this, the Fund’s per formance may","page_number":42,"box":{"x":102,"y":811,"width":767,"height":11}},{"id":"fdce9df8-1aa1-4452-b2d9-b8444acff874","block_type":"box","text":"depend more on the Manager’s or sub-adviser’s own credit analysis than in the case of mutual funds investing in","page_number":42,"box":{"x":101,"y":826,"width":806,"height":11}},{"id":"91d77970-62ce-43a4-a2f6-59406f8f235a","block_type":"box","text":"higher-rated securities.","page_number":42,"box":{"x":102,"y":841,"width":161,"height":11}},{"id":"8fe27ab2-29a4-4c61-b6ab-f69157b54b3a","block_type":"box","text":"In selecting non-investment grade securities, the Manager or sub-adviser considers factors such as those","page_number":42,"box":{"x":102,"y":863,"width":751,"height":12}},{"id":"2c5dfa74-55b7-4243-a824-c34e59bf1888","block_type":"box","text":"relating to the creditwor thiness of issuers, the ratings and per formance of the securities, the protections afforded","page_number":42,"box":{"x":69,"y":879,"width":814,"height":11}},{"id":"1776b73a-f8d9-4cd7-98dc-b8efca51fc2a","block_type":"box","text":"the securities and the diversity of the Fund. The Manager or sub-adviser continuously monitors the issuers of non","page_number":42,"box":{"x":68,"y":894,"width":812,"height":11}},{"id":"1eb068fb-49be-4ae3-8a0b-e46de74c6a5a","block_type":"box","text":"investment grade securities held by the Fund for their ability to make required principal and interest payments, as","page_number":42,"box":{"x":70,"y":909,"width":808,"height":11}},{"id":"afa2a29d-47a6-4402-9c6e-0ff10f2146e9","block_type":"box","text":"II-11","page_number":42,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"f0d3d9db-0153-4e8b-8e77-92fecddd8b01","block_type":"box","text":"NM1026U-5982568-42/232","page_number":42,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"01e49ec0-f170-4290-add3-87a941caeabb","block_type":"box","text":"well as in an effor t to control the liquidity of the Fund so that it can meet redemption requests. If a security’s rating","page_number":43,"box":{"x":68,"y":45,"width":825,"height":11}},{"id":"9e2ef20e-029d-4555-89aa-3af43dc66c25","block_type":"box","text":"is reduced below the minimum credit rating that is permitted for a Fund, the Fund’s adviser or sub-adviser will","page_number":43,"box":{"x":70,"y":60,"width":779,"height":11}},{"id":"78e3fcb4-ca94-4b24-ba92-401cc986f4ec","block_type":"box","text":"consider whether the Fund should continue to hold the security.","page_number":43,"box":{"x":69,"y":75,"width":451,"height":11}},{"id":"1c09406a-9f89-4ef4-9fe2-2519e6c7d5d6","block_type":"box","text":"In the event that a Fund investing in high yield securities experiences an unexpected level of net redemptions,","page_number":43,"box":{"x":102,"y":98,"width":782,"height":11}},{"id":"1aa25a34-51ca-4efd-ad8d-b7cf02fffb58","block_type":"box","text":"the Fund could be forced to sell its holdings without regard to the investment merits, thereby decreasing the assets","page_number":43,"box":{"x":68,"y":113,"width":825,"height":11}},{"id":"c5381b57-6e19-48c1-8023-f5d2877bb360","block_type":"box","text":"upon which the Fund’s rate of return is based.","page_number":43,"box":{"x":69,"y":128,"width":328,"height":11}},{"id":"3dc452fe-8b87-4562-a057-b0c107a369bc","block_type":"box","text":"The costs attributable to investing in the junk bond markets are usually higher for several reasons, such as","page_number":43,"box":{"x":101,"y":150,"width":764,"height":12}},{"id":"9b4aca33-2974-4a38-88bb-c26216a79a5b","block_type":"box","text":"higher investment research costs and higher commission costs.","page_number":43,"box":{"x":69,"y":166,"width":455,"height":11}},{"id":"becc0cd3-aed9-475e-9ded-f5c6b056f5ca","block_type":"box","text":"Mezzanine Investments.","page_number":43,"box":{"x":102,"y":188,"width":170,"height":9}},{"id":"052f811d-3974-4ff7-a146-53107901504d","block_type":"box","text":"Cer tain Funds, consistent with their restrictions on investing in securities of a specific","page_number":43,"box":{"x":279,"y":188,"width":612,"height":12}},{"id":"b5de7a53-a147-4348-9f13-2b67a0f09661","block_type":"box","text":"credit quality, may invest in cer tain high yield securities known as mezzanine investments, which are subordinated","page_number":43,"box":{"x":69,"y":204,"width":813,"height":11}},{"id":"f9e03761-3d67-4662-8603-13324a0c2223","block_type":"box","text":"debt securities which are generally issued in private placements in connection with an equity security (","page_number":43,"box":{"x":69,"y":219,"width":729,"height":11}},{"id":"ab5da5ec-297b-4256-b87a-57fc103aca84","block_type":"box","text":"e.g.","page_number":43,"box":{"x":800,"y":220,"width":24,"height":10}},{"id":"7fe38655-0508-4bd9-8b2c-37a0f24c2ea4","block_type":"box","text":", with","page_number":43,"box":{"x":827,"y":219,"width":36,"height":10}},{"id":"3ec474f8-bfd1-4f93-a4f9-4fc862bfdebc","block_type":"box","text":"attached warrants). Such mezzanine investments may be issued with or without registration rights. Similar to other","page_number":43,"box":{"x":69,"y":234,"width":818,"height":11}},{"id":"ea015fd8-2a4f-4642-93c1-e5d0866d879e","block_type":"box","text":"high yield securities, maturities of mezzanine investments are typically seven to ten years, but the expected average","page_number":43,"box":{"x":69,"y":249,"width":827,"height":11}},{"id":"6c2cacd4-21cc-486c-8f57-7384a09ce776","block_type":"box","text":"life is significantly shor ter at three to five years. Mezzanine investments are usually unsecured and subordinate to","page_number":43,"box":{"x":70,"y":264,"width":813,"height":11}},{"id":"c82d1ea1-c59b-4780-9e81-c3d1ffa33ab9","block_type":"box","text":"other obligations of the issuer.","page_number":43,"box":{"x":69,"y":279,"width":216,"height":11}},{"id":"74c1aed8-1372-43b2-9c83-2dccf35217eb","block_type":"box","text":"Pay-in-kind Bonds.","page_number":43,"box":{"x":102,"y":302,"width":127,"height":11}},{"id":"a9f09152-6e39-45e3-a3db-faf2afd01a04","block_type":"box","text":"Cer tain Funds may invest in pay-in-kind, or PIK, bonds. PIK bonds are bonds which pay","page_number":43,"box":{"x":236,"y":302,"width":615,"height":11}},{"id":"f5dd0cf0-1e50-480b-83b3-94de9c0e22fb","block_type":"box","text":"interest through the issuance of additional debt or equity securities. Similar to zero coupon obligations, pay-in-kind","page_number":43,"box":{"x":70,"y":317,"width":813,"height":11}},{"id":"a7677baa-8f99-447b-86fc-4ebe6084d8b6","block_type":"box","text":"bonds also carry additional risk as holders of these types of securities realize no cash until the cash payment date","page_number":43,"box":{"x":69,"y":332,"width":820,"height":11}},{"id":"0e25d141-0995-4521-a32c-873bf0e4a65e","block_type":"box","text":"unless a por tion of such securities is sold and, if the issuer defaults, a Fund may obtain no return at all on its","page_number":43,"box":{"x":69,"y":347,"width":784,"height":11}},{"id":"b2131117-73e0-4a35-a4d4-b0d65e3dd590","block_type":"box","text":"investment. The market price of pay-in-kind bonds is affected by interest rate changes to a greater extent, and","page_number":43,"box":{"x":70,"y":362,"width":783,"height":11}},{"id":"98e09280-e6ff-4361-a8cf-8cfcf1dab4b6","block_type":"box","text":"therefore tends to be more volatile, than that of securities which pay interest in cash. Additionally, current U.S.","page_number":43,"box":{"x":68,"y":377,"width":790,"height":11}},{"id":"421df66e-4786-4440-a7e2-ec13033b6d8a","block_type":"box","text":"federal tax law requires the holder of pay-in-kind bonds to accrue income with respect to these securities prior to the","page_number":43,"box":{"x":68,"y":392,"width":831,"height":12}},{"id":"39e1bed3-8b1f-4075-8241-5e34c7983b86","block_type":"box","text":"receipt of cash payments. To maintain its qualification as a regulated investment company and avoid liability for U.S.","page_number":43,"box":{"x":69,"y":407,"width":830,"height":12}},{"id":"9487b922-7ab3-4d8e-ae9b-f5334972d429","block_type":"box","text":"federal income and excise taxes, each Fund may be required to distribute income accrued with respect to these","page_number":43,"box":{"x":68,"y":423,"width":798,"height":11}},{"id":"2cf2fce6-efc6-426a-a7ce-192c1ef8a0c7","block_type":"box","text":"securities and may have to dispose of por tfolio securities under disadvantageous circumstances in order to generate","page_number":43,"box":{"x":69,"y":438,"width":835,"height":11}},{"id":"9ed2bdf3-31eb-4fc7-bf17-4b036d69264c","block_type":"box","text":"cash to satisfy these distribution requirements.","page_number":43,"box":{"x":69,"y":453,"width":336,"height":11}},{"id":"6b50ed49-a932-4519-9813-598de9d07164","block_type":"box","text":"Supranational Entities.","page_number":43,"box":{"x":102,"y":476,"width":160,"height":10}},{"id":"ab08922a-5ad2-4012-a437-27849919b165","block_type":"box","text":"A Fund may invest in debt securities of supranational entities. Examples of such entities","page_number":43,"box":{"x":268,"y":475,"width":629,"height":12}},{"id":"f3060395-cf57-4ec8-b976-fa2515c6bf5d","block_type":"box","text":"include the International Bank for Reconstruction and Development (the World Bank), the European Steel and Coal","page_number":43,"box":{"x":70,"y":491,"width":814,"height":11}},{"id":"8e97414a-d742-4594-9da2-f03ccd6dd9e6","block_type":"box","text":"Community, the Asian Development Bank and the Inter-American Development Bank. The government members, or","page_number":43,"box":{"x":69,"y":506,"width":817,"height":11}},{"id":"3927a29e-f826-40e8-b81b-d9199de4b16c","block_type":"box","text":"“stockholders,” usually make initial capital contributions to the supranational entity and in many cases are","page_number":43,"box":{"x":70,"y":521,"width":759,"height":11}},{"id":"0fe33928-3620-4aad-8f74-173dc57ea464","block_type":"box","text":"committed to make additional capital contributions if the supranational entity is unable to repay its borrowings. There","page_number":43,"box":{"x":69,"y":536,"width":836,"height":11}},{"id":"ed0d00e8-8e57-4067-9f86-f5d704cf76d9","block_type":"box","text":"is no guarantee that one or more stockholders of a supranational entity will continue to make any necessary","page_number":43,"box":{"x":70,"y":551,"width":772,"height":11}},{"id":"ddaa7b87-eb85-4ac6-abb3-d7e8b4113714","block_type":"box","text":"additional capital contributions. If such contributions are not made, the entity may be unable to pay interest or repay","page_number":43,"box":{"x":69,"y":566,"width":830,"height":11}},{"id":"ff5e8d69-37cb-4eaa-acd4-3fadc2f9d18c","block_type":"box","text":"principal on its debt securities, and a Fund may lose money on such investments.","page_number":43,"box":{"x":70,"y":582,"width":580,"height":10}},{"id":"97db4339-58d2-4ece-886f-af3e9aa8705f","block_type":"box","text":"Depositary Receipts (ADRs, EDRs and GDRs).","page_number":43,"box":{"x":102,"y":604,"width":334,"height":11}},{"id":"b5e708d0-fecf-45d9-956e-8b96182a6271","block_type":"box","text":"Cer tain Funds may invest in the securities of foreign issuers in","page_number":43,"box":{"x":442,"y":604,"width":446,"height":11}},{"id":"0038aea7-49f1-40d3-97ec-f9cb86bea740","block_type":"box","text":"the form of Depositary Receipts or other securities conver tible into securities of foreign issuers. Depositary Receipts","page_number":43,"box":{"x":68,"y":619,"width":835,"height":11}},{"id":"7f7c17a5-85a1-4630-b35f-0d5968641fdf","block_type":"box","text":"may not necessarily be denominated in the same currency as the underlying securities into which they may be","page_number":43,"box":{"x":69,"y":634,"width":784,"height":12}},{"id":"de5067a3-68dc-4d53-86bc-60b0aa745c9f","block_type":"box","text":"conver ted. The Fund may invest in both sponsored and unsponsored American Depositary Receipts (“ADRs”),","page_number":43,"box":{"x":69,"y":650,"width":781,"height":11}},{"id":"8d7101eb-c560-41e5-bf83-c14855802796","block_type":"box","text":"European Depositary Receipts (“EDRs”), Global Depositary Receipts (“GDRs”) and other similar global instruments.","page_number":43,"box":{"x":70,"y":665,"width":823,"height":11}},{"id":"2e42a6f3-ae3a-4133-b845-a03773159213","block_type":"box","text":"ADRs typically are issued by an American bank or trust company and evidence ownership of underlying securities","page_number":43,"box":{"x":68,"y":680,"width":804,"height":11}},{"id":"b632dcdb-9c98-4b29-ab19-4c922cdc39e8","block_type":"box","text":"issued by a foreign corporation. EDRs, which are sometimes referred to as Continental Depositary Receipts, are","page_number":43,"box":{"x":70,"y":695,"width":799,"height":11}},{"id":"ee0e4c1e-24ac-4b61-977b-d634d1d4469c","block_type":"box","text":"receipts issued in Europe, typically by foreign banks and trust companies, that evidence ownership of either foreign","page_number":43,"box":{"x":69,"y":710,"width":821,"height":11}},{"id":"a565ae37-8266-4f62-b591-99e59b83301e","block_type":"box","text":"or domestic underlying securities. GDRs are depositary receipts structured like global debt issues to facilitate trading","page_number":43,"box":{"x":69,"y":725,"width":837,"height":11}},{"id":"a40b2fdd-2b00-44bc-a5a0-ce2549b2bea3","block_type":"box","text":"on an international basis. In addition to investment risks associated with the underlying issuer, Depositary Receipts","page_number":43,"box":{"x":69,"y":740,"width":825,"height":11}},{"id":"3e948c15-0db8-4b47-b2bb-2a0bb1fc4b4b","block_type":"box","text":"expose a Fund to additional risks associated with the non-uniform terms that apply to Depositary Receipt programs,","page_number":43,"box":{"x":69,"y":755,"width":825,"height":11}},{"id":"ce865fc3-b30b-40ce-8564-7d126b5fc2ad","block_type":"box","text":"credit exposure to the depository bank and to the sponsors and other par ties with whom the depository bank","page_number":43,"box":{"x":69,"y":771,"width":780,"height":10}},{"id":"1fde6c0b-07b4-4a17-aaa7-6fdabed53c03","block_type":"box","text":"establishes the programs, currency risk and the risk of an illiquid market for Depositary Receipts. Unsponsored ADR,","page_number":43,"box":{"x":69,"y":785,"width":833,"height":12}},{"id":"2e5a5227-95bf-44c8-a706-b1cf9bfed4b3","block_type":"box","text":"EDR and GDR programs are organized independently and without the cooperation of the issuer of the underlying","page_number":43,"box":{"x":70,"y":801,"width":796,"height":11}},{"id":"3fc91cfd-f5c5-4ff7-afec-a93c0bd7344c","block_type":"box","text":"securities. Unsponsored programs generally expose investors to greater risks than sponsored programs and do not","page_number":43,"box":{"x":69,"y":816,"width":822,"height":11}},{"id":"937894cb-45f2-4d3a-a12d-61247126cd7b","block_type":"box","text":"provide holders with many of the shareholder benefits that come from investing in a sponsored Depositary Receipt.","page_number":43,"box":{"x":70,"y":831,"width":820,"height":11}},{"id":"245dd0ce-a7bd-490e-a766-feb1830b8ee6","block_type":"box","text":"Available information concerning the issuer may not be as current as for sponsored ADRs, EDRs and GDRs, and the","page_number":43,"box":{"x":68,"y":846,"width":827,"height":11}},{"id":"24b942cc-6109-4bb4-b8de-3b5f14f50b4b","block_type":"box","text":"prices of unsponsored ADRs, EDRs and GDRs may be more volatile than if such instruments were sponsored by the","page_number":43,"box":{"x":70,"y":861,"width":825,"height":11}},{"id":"d0ceddd9-0f05-48da-ba3c-3a02bdf4592b","block_type":"box","text":"issuer. Depositary Receipts are generally subject to the same risks as the foreign securities that they evidence or","page_number":43,"box":{"x":70,"y":876,"width":810,"height":11}},{"id":"7c0a8692-465c-4491-98af-9d0abb03b5dc","block_type":"box","text":"into which they may be conver ted. Investments in ADRs, EDRs and GDRs present additional investment","page_number":43,"box":{"x":70,"y":891,"width":737,"height":11}},{"id":"5def14ba-14a3-4e5b-812f-c1871580f176","block_type":"box","text":"considerations as described under “Foreign Investment Risks.”","page_number":43,"box":{"x":69,"y":907,"width":449,"height":11}},{"id":"d8712917-d9be-4b67-9415-b602a847c3ae","block_type":"box","text":"II-12","page_number":43,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"d26080e0-1d07-49b4-acb0-9140a3b74788","block_type":"box","text":"NM1026U-5982568-43/232","page_number":43,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"9c66a6ee-c996-4c2d-a26e-e6c2e54898b2","block_type":"box","text":"Derivatives.","page_number":44,"box":{"x":102,"y":45,"width":84,"height":9}},{"id":"7663e121-94cd-4d17-adba-44a37b53fd64","block_type":"box","text":"General.","page_number":44,"box":{"x":102,"y":67,"width":58,"height":9}},{"id":"294a3a16-7333-48c3-87d1-bc136cbbe4f2","block_type":"box","text":"Each Fund may use instruments referred to as derivatives, which are financial instruments that derive","page_number":44,"box":{"x":167,"y":67,"width":725,"height":11}},{"id":"b60149c8-ddc8-406a-ac21-5f568417e426","block_type":"box","text":"their value from one or more securities, commodities (such as gold or oil), currencies, interest rates, credit events or","page_number":44,"box":{"x":68,"y":82,"width":836,"height":12}},{"id":"c7cf3107-d3e1-4173-9c18-8418ecd49253","block_type":"box","text":"indices (a measure of value or rates, such as the S&P 500 Index or the prime lending rate) or other reference asset.","page_number":44,"box":{"x":70,"y":98,"width":829,"height":11}},{"id":"99edfd35-4908-4ffa-b06e-9a0320ec1505","block_type":"box","text":"Derivatives may allow a Fund to increase or decrease the level of risk to which the Fund is exposed more quickly and","page_number":44,"box":{"x":70,"y":113,"width":830,"height":11}},{"id":"d5d14499-34d8-47d8-a90f-ec1f36519034","block_type":"box","text":"efficiently than with other transactions. Cer tain Funds may use derivatives to maintain a por tion of their long and","page_number":44,"box":{"x":69,"y":128,"width":804,"height":11}},{"id":"956cd4ab-5abb-4ab9-b741-adc1770cf303","block_type":"box","text":"shor t positions. Unless otherwise permitted, no Fund may use derivatives to gain exposure to an asset or asset","page_number":44,"box":{"x":69,"y":143,"width":800,"height":11}},{"id":"032a6594-e381-4882-b474-5dad1df5be0e","block_type":"box","text":"class it is prohibited by its investment restrictions from purchasing directly. As described below, derivatives can be","page_number":44,"box":{"x":69,"y":158,"width":816,"height":11}},{"id":"7449782b-bb0d-4585-a833-48694f54e48c","block_type":"box","text":"used for hedging or speculative purposes. Funds will engage in transaction-level payment netting,","page_number":44,"box":{"x":69,"y":173,"width":691,"height":11}},{"id":"0ba687c4-5991-425f-9abd-100df5dba9e4","block_type":"box","text":"i.e.","page_number":44,"box":{"x":768,"y":173,"width":20,"height":9}},{"id":"71198eaa-a92b-444f-bfe4-5a5e8a7a84a1","block_type":"box","text":", the payment","page_number":44,"box":{"x":791,"y":173,"width":96,"height":11}},{"id":"10e172fa-3b57-4e82-ba50-c9dcb3d774ed","block_type":"box","text":"obligations of derivatives contracts are netted against one another with the Fund receiving or paying, as the case may","page_number":44,"box":{"x":69,"y":188,"width":839,"height":12}},{"id":"b0ca25d7-d142-46e7-b615-ee6f7d02716d","block_type":"box","text":"be, only the net amount of the two payment streams.","page_number":44,"box":{"x":69,"y":203,"width":378,"height":12}},{"id":"2238b343-d280-4992-9515-24441204a87b","block_type":"box","text":"Hedging.","page_number":44,"box":{"x":102,"y":226,"width":60,"height":11}},{"id":"867d566b-bb17-4500-b5d6-5bd770769167","block_type":"box","text":"Each Fund may use derivatives for hedging purposes, in which a derivative is used to offset the risks","page_number":44,"box":{"x":169,"y":226,"width":717,"height":11}},{"id":"98d1d0c7-717b-4faa-8522-9a06078338b9","block_type":"box","text":"associated with other Fund holdings. Losses on other investments may be substantially reduced by gains on a","page_number":44,"box":{"x":69,"y":241,"width":786,"height":11}},{"id":"a9163d0a-2fff-48c4-88f6-228924451b3b","block_type":"box","text":"derivative that reacts in an opposite manner to market movements. Although hedging may reduce losses, it may also","page_number":44,"box":{"x":69,"y":257,"width":834,"height":11}},{"id":"f90990a0-37d2-4b0c-9322-79e614aa8df8","block_type":"box","text":"reduce or eliminate gains. In addition, hedging may cause losses if the market moves in an unanticipated manner, or","page_number":44,"box":{"x":69,"y":271,"width":834,"height":12}},{"id":"eb998d68-ba84-4ffa-912f-9db800138089","block_type":"box","text":"if the cost of the derivative outweighs the benefit of the hedge. The effectiveness of hedging may be reduced by","page_number":44,"box":{"x":70,"y":286,"width":797,"height":12}},{"id":"22be0f4e-35b6-4ec1-b05d-e8cb461a2ae7","block_type":"box","text":"correlation risk,","page_number":44,"box":{"x":69,"y":302,"width":109,"height":10}},{"id":"3390635e-3ac8-4834-9a47-eb7d7f5fda1f","block_type":"box","text":"i.e.","page_number":44,"box":{"x":186,"y":302,"width":20,"height":9}},{"id":"ea598297-42d3-4ffc-8104-215fa4dc7e7c","block_type":"box","text":", the risk that changes in the value of the derivative will not match those of the holdings being","page_number":44,"box":{"x":209,"y":302,"width":669,"height":11}},{"id":"7c8def59-8d52-42bb-b8ee-cc0de3e80d0a","block_type":"box","text":"hedged as expected by a Fund, which may result in additional losses to the Fund. The inability to close or offset","page_number":44,"box":{"x":69,"y":317,"width":797,"height":11}},{"id":"676ddcae-e352-4bc5-8126-10537e9c795b","block_type":"box","text":"derivatives could also reduce the effectiveness of a Fund’s hedging. There is no assurance that a Fund’s hedging will","page_number":44,"box":{"x":69,"y":332,"width":835,"height":11}},{"id":"7855dc90-7d26-4bab-bf44-e4af184da3d8","block_type":"box","text":"be effective. No Fund is required to use derivatives to hedge.","page_number":44,"box":{"x":69,"y":347,"width":434,"height":11}},{"id":"1ddadaa9-57f3-4b24-84ef-86f12737a8be","block_type":"box","text":"Speculation.","page_number":44,"box":{"x":102,"y":370,"width":86,"height":11}},{"id":"0757cc28-b29c-40fc-9273-1d195a437ee3","block_type":"box","text":"Cer tain Funds may also use derivatives for speculative purposes to seek to enhance returns. The","page_number":44,"box":{"x":195,"y":370,"width":694,"height":11}},{"id":"14d9e00c-e124-4b45-adfc-3b867153ce13","block_type":"box","text":"use of a derivative is speculative if the Fund is primarily seeking to achieve gains, rather than offset the risk of other","page_number":44,"box":{"x":69,"y":385,"width":831,"height":11}},{"id":"6b388494-075f-4f71-bc57-9d56e41eec32","block_type":"box","text":"positions. To the extent a Fund invests in a derivative for speculative purposes, the Fund will be fully exposed to the","page_number":44,"box":{"x":70,"y":400,"width":824,"height":11}},{"id":"77c4803f-b01b-4e9e-8d16-0f5c73dd7182","block_type":"box","text":"risks of loss of that derivative, which may sometimes be greater than the derivative’s cost, and the potential for loss","page_number":44,"box":{"x":69,"y":415,"width":831,"height":11}},{"id":"1f437cd5-111f-4763-a2a5-2bf86f3b572e","block_type":"box","text":"in cer tain cases may be unlimited.","page_number":44,"box":{"x":70,"y":430,"width":243,"height":11}},{"id":"1a5d5887-8028-4f11-aec3-c544264b7212","block_type":"box","text":"Regulation of Derivatives.","page_number":44,"box":{"x":102,"y":453,"width":180,"height":11}},{"id":"3a21fd20-0851-4032-bddf-1a8d554eb07d","block_type":"box","text":"Rule 18f-4 Under the Investment Company Act.","page_number":44,"box":{"x":102,"y":475,"width":333,"height":12}},{"id":"6c27a8e4-d209-4fd0-80f8-1ecc777c3906","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to","page_number":44,"box":{"x":442,"y":475,"width":458,"height":12}},{"id":"eace1d78-d785-4a6f-9bcc-078a61900be3","block_type":"box","text":"enter into Derivatives Transactions (as defined below) and cer tain other transactions notwithstanding the restrictions","page_number":44,"box":{"x":69,"y":491,"width":833,"height":11}},{"id":"d3d1426a-b792-4d9a-b20e-89ef0de34abd","block_type":"box","text":"on the issuance of “senior securities” under Section 18 of the Investment Company Act. Section 18 of the","page_number":44,"box":{"x":69,"y":506,"width":759,"height":11}},{"id":"f25a9102-854e-4492-81ad-0f02b98abae7","block_type":"box","text":"Investment Company Act, among other things, prohibits open-end funds, including the Funds, from issuing or selling","page_number":44,"box":{"x":70,"y":521,"width":825,"height":11}},{"id":"92740306-95ce-4b05-a305-ef9da4b823e7","block_type":"box","text":"any “senior security,” other than borrowing from a bank (subject to a requirement to maintain 300% “asset","page_number":44,"box":{"x":69,"y":536,"width":763,"height":11}},{"id":"7204fdb9-8a9e-47a5-91de-a3e632092da0","block_type":"box","text":"coverage”).","page_number":44,"box":{"x":69,"y":551,"width":79,"height":11}},{"id":"de4a2a6d-c52a-4151-b154-e0b28198840e","block_type":"box","text":"Under Rule 18f-4, “Derivatives Transactions” include the following: (1) any swap, security-based swap (including","page_number":44,"box":{"x":102,"y":574,"width":796,"height":11}},{"id":"a1ea3e04-37ad-4b7f-b4a4-1d6717c398ea","block_type":"box","text":"a contract for differences), futures contract, forward contract, option (excluding purchased options), any combination","page_number":44,"box":{"x":69,"y":589,"width":832,"height":11}},{"id":"61040a8d-6d1e-4263-80c4-41e3ab073d33","block_type":"box","text":"of the foregoing, or any similar instrument, under which a Fund is or may be required to make any payment or delivery","page_number":44,"box":{"x":69,"y":604,"width":840,"height":11}},{"id":"504d381f-e24e-4bc3-9802-ae1bf7416f25","block_type":"box","text":"of cash or other assets during the life of the instrument or at maturity or early termination, whether as margin or","page_number":44,"box":{"x":69,"y":619,"width":801,"height":11}},{"id":"6480e5d0-291b-4e50-9fdd-90763e76ba70","block_type":"box","text":"settlement payment or otherwise; (2) any shor t sale borrowing; (3) reverse repurchase agreements and similar","page_number":44,"box":{"x":69,"y":634,"width":791,"height":12}},{"id":"eec2404a-5c1a-4edf-9643-50202655dbd2","block_type":"box","text":"financing transactions (","page_number":44,"box":{"x":68,"y":649,"width":166,"height":12}},{"id":"dfb47837-2bb0-4d1e-8e7d-47bdbfcec173","block_type":"box","text":"e.g.","page_number":44,"box":{"x":236,"y":651,"width":25,"height":10}},{"id":"896760a6-999f-4780-865a-e789dd0ffb2a","block_type":"box","text":", recourse and non-recourse tender option bonds, and borrowed bonds), if a Fund elects to","page_number":44,"box":{"x":263,"y":649,"width":646,"height":11}},{"id":"d159cef6-8062-4379-8249-08c432b1ee46","block_type":"box","text":"treat all of these transactions as Derivatives Transactions under Rule 18f-4; and (4) when-issued or forward-settling","page_number":44,"box":{"x":68,"y":664,"width":825,"height":12}},{"id":"71e07532-93b5-49cb-8157-de5e0fdcd3b8","block_type":"box","text":"securities (","page_number":44,"box":{"x":69,"y":680,"width":78,"height":11}},{"id":"4712d55f-1385-4a59-8d55-e56c35dcf22b","block_type":"box","text":"e.g.","page_number":44,"box":{"x":148,"y":681,"width":25,"height":10}},{"id":"e453d523-4329-4905-9ea9-48e6deb750a9","block_type":"box","text":", firm and standby commitments, including to-be-announced (“TBA”) commitments, and dollar rolls)","page_number":44,"box":{"x":176,"y":680,"width":704,"height":11}},{"id":"67a71694-b03a-47a4-b000-480bfee8a682","block_type":"box","text":"and non-standard settlement cycle securities, unless such transactions meet the Delayed-Settlement Securities","page_number":44,"box":{"x":69,"y":695,"width":796,"height":11}},{"id":"a19af248-c8bf-47fd-a491-9c29c6992848","block_type":"box","text":"Provision (as defined below under “—When-Issued Securities, Delayed Delivery Securities and Forward","page_number":44,"box":{"x":69,"y":710,"width":732,"height":11}},{"id":"11f3e6db-50a7-4b8a-9312-ff78e74f0f40","block_type":"box","text":"Commitments”).","page_number":44,"box":{"x":69,"y":725,"width":115,"height":11}},{"id":"7576547f-7a1d-48f8-80de-0f0b011e2905","block_type":"box","text":"Unless a Fund is relying on the Limited Derivatives User Exception (as defined below), the Fund must comply with","page_number":44,"box":{"x":102,"y":748,"width":805,"height":11}},{"id":"315a7131-2686-4a0d-980a-4fd5b7e654af","block_type":"box","text":"Rule 18f-4 with respect to its Derivatives Transactions. Rule 18f-4, among other things, requires a Fund to adopt and","page_number":44,"box":{"x":70,"y":763,"width":832,"height":11}},{"id":"7ce4add9-50d2-40e6-a0b6-2651cad38967","block_type":"box","text":"implement a comprehensive written derivatives risk management program (“DRMP”) and comply with a relative or","page_number":44,"box":{"x":70,"y":778,"width":808,"height":11}},{"id":"b0c220e4-c8a3-454a-9195-a3fd761eb9a0","block_type":"box","text":"absolute limit on Fund leverage risk calculated based on value-at-risk (“VaR”). The DRMP is administered by a","page_number":44,"box":{"x":69,"y":793,"width":780,"height":11}},{"id":"46e650cf-0199-4749-bc85-4cfaab0e2876","block_type":"box","text":"“derivatives risk manager,” who is appointed by the Fund’s Board, including a majority of the independent Directors,","page_number":44,"box":{"x":70,"y":808,"width":824,"height":11}},{"id":"889adf64-01d0-43e3-b3be-99001a03328b","block_type":"box","text":"and periodically reviews the DRMP and repor ts to the Fund’s Board.","page_number":44,"box":{"x":69,"y":823,"width":482,"height":11}},{"id":"7aefa2b7-0f98-409a-b069-945b3b247c08","block_type":"box","text":"Rule 18f-4 provides an exception from the DRMP, VaR limit and cer tain other requirements if a Fund’s","page_number":44,"box":{"x":102,"y":846,"width":724,"height":11}},{"id":"741f7308-fb71-4343-887e-b82bd2478a93","block_type":"box","text":"“derivatives exposure” is limited to 10% of its net assets (as calculated in accordance with Rule 18f-4) and the Fund","page_number":44,"box":{"x":70,"y":861,"width":830,"height":11}},{"id":"e3fe83b5-bd4c-4108-8ad8-9d1b5ac5404e","block_type":"box","text":"adopts and implements written policies and procedures reasonably designed to manage its derivatives risks (the","page_number":44,"box":{"x":69,"y":876,"width":803,"height":11}},{"id":"8ed4cbd8-56df-4c77-bfba-395ed53a7acf","block_type":"box","text":"“Limited Derivatives User Exception”).","page_number":44,"box":{"x":70,"y":891,"width":268,"height":11}},{"id":"d59fd1be-3d0a-49d1-af17-2f6a0afcb20a","block_type":"box","text":"II-13","page_number":44,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"3b749031-88ff-41a4-b74b-146cfa7dbf98","block_type":"box","text":"NM1026U-5982568-44/232","page_number":44,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"6c424c1b-f659-4900-8d62-6c112bb8aada","block_type":"box","text":"Dodd-Frank Regulations.","page_number":45,"box":{"x":102,"y":45,"width":171,"height":11}},{"id":"c53d4182-7281-460e-b7a4-3d2f47ac639c","block_type":"box","text":"The Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”),","page_number":45,"box":{"x":279,"y":45,"width":575,"height":11}},{"id":"a33a18a8-1785-4c17-acca-9abcb42f8fee","block_type":"box","text":"enacted in July 2010, includes provisions that comprehensively regulate the over-the-counter (“OTC”) derivatives","page_number":45,"box":{"x":69,"y":60,"width":800,"height":11}},{"id":"91b5b963-d332-4272-9545-9fb89f9dc9c1","block_type":"box","text":"markets for the first time. While the Commodity Futures Trading Commission (“CFTC”) and other U.S. regulators have","page_number":45,"box":{"x":69,"y":75,"width":834,"height":11}},{"id":"1def785f-defb-468d-b434-3f57e927ee89","block_type":"box","text":"adopted many of the required Dodd-Frank regulations, cer tain regulations have only recently become effective and","page_number":45,"box":{"x":69,"y":90,"width":813,"height":11}},{"id":"90e5695f-0d0f-4c89-96b6-73f09ee61c3f","block_type":"box","text":"other regulations remain to be adopted. The full impact of Dodd-Frank on the Funds remains uncer tain.","page_number":45,"box":{"x":69,"y":105,"width":733,"height":11}},{"id":"ee251ea9-8af9-41a1-b069-ee83bb3cc57f","block_type":"box","text":"Many OTC derivatives dealers are required to register with the CFTC as “swap dealers” and/or with the SEC as","page_number":45,"box":{"x":102,"y":128,"width":789,"height":11}},{"id":"e5cbc784-9a1c-4ade-9db9-88e721f837de","block_type":"box","text":"“security-based swap dealers”. Registered swap dealers and security-based swap dealers are subject to various","page_number":45,"box":{"x":70,"y":143,"width":797,"height":11}},{"id":"c3768e70-010c-4cfb-b1ff-12da197f968f","block_type":"box","text":"regulatory requirements, including, but not limited to, margin, recordkeeping, repor ting, transparency, position limits,","page_number":45,"box":{"x":69,"y":158,"width":833,"height":11}},{"id":"5c84ac4e-ff1f-44a8-9449-e429d94e561b","block_type":"box","text":"limitations on conflicts of interest, business conduct standards, minimum capital requirements and other regulatory","page_number":45,"box":{"x":70,"y":173,"width":826,"height":11}},{"id":"855f074a-8f7a-4508-bfeb-b4d7bb2975a9","block_type":"box","text":"requirements, which indirectly impact the Funds that enter into transactions with them.","page_number":45,"box":{"x":69,"y":188,"width":618,"height":11}},{"id":"cee682b2-0625-449a-bb72-726efc9bd131","block_type":"box","text":"The CFTC requires that cer tain interest rate swaps and cer tain credit default swaps must be executed in","page_number":45,"box":{"x":101,"y":211,"width":745,"height":11}},{"id":"76bd77c5-6356-4de8-b1ac-cb977f51179f","block_type":"box","text":"regulated markets and be submitted for clearing to regulated clearinghouses. The SEC is also expected to impose","page_number":45,"box":{"x":69,"y":226,"width":813,"height":11}},{"id":"b30cacc5-03a1-484b-9a48-08034fd22c9a","block_type":"box","text":"similar requirements on cer tain security-based derivatives in the future. OTC derivatives trades submitted for clearing","page_number":45,"box":{"x":69,"y":241,"width":835,"height":11}},{"id":"f45989a9-95a1-41f1-b6dd-01c95d38ed83","block_type":"box","text":"are subject to minimum initial and variation margin requirements set by the relevant clearinghouse, as well as margin","page_number":45,"box":{"x":69,"y":257,"width":837,"height":11}},{"id":"5d9cbb2c-4415-4e29-8625-acd2f59b31d3","block_type":"box","text":"requirements mandated by the CFTC, SEC and/or federal prudential regulators. In addition, futures commission","page_number":45,"box":{"x":69,"y":271,"width":794,"height":12}},{"id":"b90e98bc-c7b4-41be-8bca-0fea91fccf1c","block_type":"box","text":"merchants (“FCMs”), who act as clearing members on behalf of customers for cleared OTC derivatives and futures","page_number":45,"box":{"x":69,"y":286,"width":815,"height":12}},{"id":"de2be7df-16b2-4929-8078-46e3a8c2b2ba","block_type":"box","text":"contracts, also have discretion to increase a Fund’s margin requirements for these transactions beyond any","page_number":45,"box":{"x":69,"y":302,"width":770,"height":11}},{"id":"7acac5f7-1227-41ff-a657-1a4914ad2511","block_type":"box","text":"regulatory and clearinghouse minimums subject to any restrictions on such discretion in the documentation between","page_number":45,"box":{"x":69,"y":317,"width":831,"height":11}},{"id":"1215fb44-eedc-4c38-8e1a-d740e7b866d9","block_type":"box","text":"the FCM and the customer. These regulatory requirements may make it more difficult and costly for the Funds to","page_number":45,"box":{"x":68,"y":332,"width":804,"height":11}},{"id":"fc940e99-1bb2-499c-9a7e-a2c6f4d3ff3e","block_type":"box","text":"enter into highly tailored or customized transactions, potentially rendering cer tain investment strategies impossible or","page_number":45,"box":{"x":69,"y":347,"width":839,"height":11}},{"id":"7f3e1a17-fc95-40b4-bee0-89439fce8de9","block_type":"box","text":"not economically feasible. If a Fund decides to execute and clear cleared OTC derivatives and/or futures contracts","page_number":45,"box":{"x":69,"y":362,"width":814,"height":11}},{"id":"5096b408-7cba-43df-b877-998a6bc77e47","block_type":"box","text":"through execution facilities, exchanges or clearinghouses, either indirectly through an executing broker, clearing","page_number":45,"box":{"x":68,"y":377,"width":796,"height":12}},{"id":"99f9d357-553c-40a1-9890-a7adb1a2713e","block_type":"box","text":"member FCM or as a direct member, a Fund would be required to comply with the rules of the execution facility,","page_number":45,"box":{"x":69,"y":392,"width":793,"height":12}},{"id":"ca3bd98a-28a3-4f2e-b396-aef26ba600ac","block_type":"box","text":"exchange or clearinghouse and other applicable law.","page_number":45,"box":{"x":69,"y":408,"width":370,"height":11}},{"id":"434d8899-24fa-4c84-908c-27b7a7586902","block_type":"box","text":"With respect to cleared OTC derivatives and futures contracts and options on futures, a Fund will not face a","page_number":45,"box":{"x":101,"y":430,"width":766,"height":11}},{"id":"7aeed73d-9f99-41c6-b49f-7a9991912d3c","block_type":"box","text":"clearinghouse directly but rather will do so through a FCM that is registered with the CFTC and/or SEC and that acts","page_number":45,"box":{"x":69,"y":445,"width":826,"height":12}},{"id":"499059ff-763e-4490-a7f0-9a3e9dc53fb3","block_type":"box","text":"as a clearing member. A Fund may face the indirect risk of the failure of another clearing member customer to meet","page_number":45,"box":{"x":69,"y":460,"width":825,"height":12}},{"id":"ad1467a2-5303-4cc3-a516-6b5de29b0adf","block_type":"box","text":"its obligations to its clearing member. Such scenario could arise due to a default by the clearing member on its","page_number":45,"box":{"x":70,"y":475,"width":791,"height":12}},{"id":"bfe58334-1349-44a7-919f-7d557c586e9a","block_type":"box","text":"obligations to the clearinghouse simultaneously with a customer’s failure to meet its obligations to the clearing","page_number":45,"box":{"x":69,"y":491,"width":793,"height":11}},{"id":"2296968f-6102-4d07-a5ed-e5be4f78e90b","block_type":"box","text":"member.","page_number":45,"box":{"x":69,"y":506,"width":60,"height":9}},{"id":"62da5b56-7310-4edd-af39-5e755eace6a6","block_type":"box","text":"Clearing member FCMs are required to post initial margin to the clearinghouses through which they clear their","page_number":45,"box":{"x":102,"y":529,"width":782,"height":11}},{"id":"019afe30-9e57-406a-8806-575120511b4d","block_type":"box","text":"customers’ cleared OTC derivatives and futures contracts, instead of using such initial margin in their businesses, as","page_number":45,"box":{"x":69,"y":543,"width":837,"height":12}},{"id":"59ad40a8-1c85-4719-b64d-cb1fc93babb3","block_type":"box","text":"was widely permitted for OTC derivatives before Dodd-Frank. While an FCM may require its customer to post initial","page_number":45,"box":{"x":68,"y":559,"width":811,"height":11}},{"id":"3c4fa7dd-e7fe-49ec-8ba1-d15913c7232b","block_type":"box","text":"margin in excess of clearinghouse requirements, and cer tain clearinghouses may share a por tion of their earnings on","page_number":45,"box":{"x":69,"y":574,"width":838,"height":11}},{"id":"38e8a5a5-e1e7-4e77-81b2-f2ffa0317c98","block_type":"box","text":"initial margin with their clearing members, some por tion of the initial margin that is passed through to the","page_number":45,"box":{"x":70,"y":589,"width":754,"height":11}},{"id":"5de281a2-109f-479a-b9fe-0fc8b9433b8f","block_type":"box","text":"clearinghouse does not generate earnings for the FCM. The inability of FCMs to earn the same levels of returns on","page_number":45,"box":{"x":69,"y":604,"width":815,"height":11}},{"id":"aba4c308-9777-4ba5-9b56-71aaff61e317","block_type":"box","text":"initial margin for cleared OTC derivatives as they could earn with respect to non-cleared OTC derivatives may cause","page_number":45,"box":{"x":70,"y":619,"width":817,"height":11}},{"id":"2c5ed4ce-5aa0-4799-8aa9-3882e5881a5f","block_type":"box","text":"FCMs to charge higher fees, or provide less favorable pricing on cleared OTC derivatives than swap dealers will","page_number":45,"box":{"x":70,"y":634,"width":788,"height":12}},{"id":"306241bc-48a4-44eb-a875-59b8f260ae69","block_type":"box","text":"provide for non-cleared OTC derivatives. Fur thermore, customers, including the Funds, are subject to additional fees","page_number":45,"box":{"x":70,"y":649,"width":825,"height":12}},{"id":"40981632-dfa2-4fda-a304-ce7c22cbe8ea","block_type":"box","text":"payable to FCMs with respect to cleared OTC derivatives, which may raise the cost to Funds of clearing as compared","page_number":45,"box":{"x":70,"y":664,"width":829,"height":12}},{"id":"e39a1ed3-7647-4a73-9201-2233bb0095ff","block_type":"box","text":"to trading non-cleared OTC derivatives bilaterally.","page_number":45,"box":{"x":68,"y":680,"width":346,"height":11}},{"id":"9324776a-43c3-403e-a614-b80d338b29c9","block_type":"box","text":"With respect to uncleared swaps, registered swap dealers and security-based swap dealers are required to","page_number":45,"box":{"x":101,"y":703,"width":762,"height":11}},{"id":"9926b9a6-89eb-4f16-81de-8e018f62dc37","block_type":"box","text":"exchange variation margin with a Fund and may be required by applicable regulations to collect (and in some cases","page_number":45,"box":{"x":69,"y":718,"width":820,"height":11}},{"id":"078ff5a8-396a-4f5e-88f2-1b5d61648599","block_type":"box","text":"exchange) initial margin with a Fund. Both initial and variation margin may be comprised of cash and/or securities,","page_number":45,"box":{"x":69,"y":732,"width":816,"height":12}},{"id":"6185e35e-25b6-4918-9ac6-c535b0fe970e","block_type":"box","text":"subject to applicable regulatory haircuts and other restrictions. Shares of investment companies (other than cer tain","page_number":45,"box":{"x":69,"y":748,"width":825,"height":11}},{"id":"5841f0b6-7f76-4024-86f8-8a02b5dc40aa","block_type":"box","text":"money market funds) may not be posted as collateral under applicable regulations.","page_number":45,"box":{"x":69,"y":763,"width":590,"height":11}},{"id":"c28da00a-2c5b-4d20-899c-f88db4c557b6","block_type":"box","text":"The CFTC, cer tain foreign regulators, and many futures exchanges have established (and continue to evaluate","page_number":45,"box":{"x":101,"y":785,"width":783,"height":12}},{"id":"4ec4c103-23d5-44de-a825-20f6f2d6b1ac","block_type":"box","text":"and monitor) speculative position limits (“position limits”) on the maximum speculative position which any person, or","page_number":45,"box":{"x":69,"y":801,"width":833,"height":11}},{"id":"ed9e5b4e-7428-4b4b-9469-fa142aca9bad","block_type":"box","text":"group of persons acting in concer t, may hold or control in par ticular contracts. In addition, U.S. federal position limits","page_number":45,"box":{"x":68,"y":816,"width":837,"height":11}},{"id":"7c4e95f7-96fe-4931-8954-de45e02b8080","block_type":"box","text":"apply to swaps that are economically equivalent to futures contracts on cer tain agricultural, metals and energy","page_number":45,"box":{"x":69,"y":831,"width":789,"height":11}},{"id":"6d316c90-12ef-4cd5-bf27-7edd3872b4f7","block_type":"box","text":"commodities. All positions owned or controlled by the same person or entity, even if in different accounts, must be","page_number":45,"box":{"x":69,"y":846,"width":818,"height":11}},{"id":"439bb8c9-be9f-4af1-aae2-ac54699324b1","block_type":"box","text":"aggregated for purposes of complying with the speculative limits. Thus, even if a Fund does not intend to exceed","page_number":45,"box":{"x":69,"y":861,"width":801,"height":11}},{"id":"b467f4fb-ac2b-4913-b4eb-4879bb80b8ff","block_type":"box","text":"applicable position limits, it is possible that different clients managed by the Manager and its affiliates may be","page_number":45,"box":{"x":69,"y":876,"width":791,"height":11}},{"id":"f364a913-047b-441b-b151-1810e12b0627","block_type":"box","text":"aggregated for this purpose. Therefore, the trading decisions of the Manager may have to be modified and positions","page_number":45,"box":{"x":69,"y":891,"width":827,"height":12}},{"id":"648c9984-8b23-44df-b9db-8fc60d998d19","block_type":"box","text":"held by a Fund liquidated in order to avoid exceeding such limits. The modification of investment decisions or the","page_number":45,"box":{"x":69,"y":906,"width":805,"height":12}},{"id":"648c81a7-2603-439b-abf1-6dec4da1c6c4","block_type":"box","text":"II-14","page_number":45,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"167c8784-a91a-4caa-9c14-2f2a95e90ad8","block_type":"box","text":"NM1026U-5982568-45/232","page_number":45,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"b5edd595-f890-4ded-bf6d-10b31d22aa46","block_type":"box","text":"elimination of open positions, if it occurs, may adversely affect the profitability of a Fund. A violation of position limits","page_number":46,"box":{"x":69,"y":45,"width":837,"height":11}},{"id":"82599c0e-5ac5-4028-a98f-cbd716b548e3","block_type":"box","text":"could also lead to regulatory action materially adverse to a Fund’s investment strategy. A Fund may also be affected","page_number":46,"box":{"x":69,"y":60,"width":827,"height":11}},{"id":"b46e00d6-66b5-4803-852d-a5e13fa3620d","block_type":"box","text":"by other regimes, including those of the European Union and United Kingdom, and trading venues that impose","page_number":46,"box":{"x":69,"y":75,"width":785,"height":11}},{"id":"964fbc28-46a9-46e6-905f-5a2d0ea4874e","block_type":"box","text":"position limits on commodity derivative contracts.","page_number":46,"box":{"x":70,"y":90,"width":350,"height":11}},{"id":"915b9e72-6cb7-45a8-9d97-54c61170cc47","block_type":"box","text":"Additional Regulation of Derivatives.","page_number":46,"box":{"x":101,"y":113,"width":256,"height":11}},{"id":"2e3b039c-378b-4c1a-98cd-e0f680a0b52f","block_type":"box","text":"Regulatory bodies outside the U.S. have also passed, proposed, or may","page_number":46,"box":{"x":364,"y":113,"width":513,"height":11}},{"id":"ca2e0215-c796-466b-bc74-cf9654b259d9","block_type":"box","text":"propose in the future, legislation similar to Dodd-Frank or other legislation that could increase the costs of","page_number":46,"box":{"x":70,"y":128,"width":757,"height":11}},{"id":"cd385c37-7d99-4bca-a953-ea8169bf2650","block_type":"box","text":"par ticipating in, or otherwise adversely impact the liquidity of, par ticipating in the commodities markets. For example,","page_number":46,"box":{"x":70,"y":143,"width":836,"height":11}},{"id":"3297c9b6-f819-4125-a9c0-329f94e251e1","block_type":"box","text":"the European Market Infrastructure Regulation (Regulation (EU) No 648/2012) (“EMIR”) introduced cer tain","page_number":46,"box":{"x":68,"y":158,"width":762,"height":11}},{"id":"9cd6e505-fc18-4a1c-b3df-d6dee2c9bc05","block_type":"box","text":"requirements in respect of OTC derivatives including: (i) the mandatory clearing of OTC derivative contracts declared","page_number":46,"box":{"x":69,"y":173,"width":825,"height":11}},{"id":"10c30f22-9ca3-4d93-bc8f-51ffb7782d1e","block_type":"box","text":"subject to the clearing obligation; (ii) risk mitigation techniques in respect of uncleared OTC derivative contracts,","page_number":46,"box":{"x":69,"y":188,"width":798,"height":12}},{"id":"780777ad-6b54-4bd1-ad86-eb7f3a2384b8","block_type":"box","text":"including the mandatory margining of uncleared OTC derivative contracts; and (iii) repor ting and recordkeeping","page_number":46,"box":{"x":70,"y":203,"width":785,"height":12}},{"id":"7d7fa5e8-451e-4e65-a5e1-76cde6fbb5e7","block_type":"box","text":"requirements in respect of all derivatives contracts. By way of fur ther example, the European Union Markets in","page_number":46,"box":{"x":69,"y":218,"width":787,"height":12}},{"id":"1995579e-159a-4bb1-a02f-ea0e42cd11e7","block_type":"box","text":"Financial Instruments Directive (Directive 2014/65/EU) and Markets in Financial Instruments Regulation (Regulation","page_number":46,"box":{"x":70,"y":234,"width":830,"height":11}},{"id":"fa71beb9-b17e-4fda-b2b8-72a5f543ef1d","block_type":"box","text":"(EU) No 600/2014) (together “MiFID II”), which have applied since January 3, 2018, govern the provision of","page_number":46,"box":{"x":69,"y":249,"width":771,"height":11}},{"id":"a49328c3-c1b7-4e80-8a05-e1cdaffb28bd","block_type":"box","text":"investment services and activities in relation to, as well as the organized trading of, financial instruments such as","page_number":46,"box":{"x":70,"y":264,"width":812,"height":11}},{"id":"4d68ba74-0c02-4d84-ae0f-8e154350ed07","block_type":"box","text":"shares, bonds, units in collective investment schemes and derivatives. In par ticular, MiFID II requires European Union","page_number":46,"box":{"x":69,"y":279,"width":839,"height":11}},{"id":"3d3e7a8d-bc66-47dc-b2ae-020cb080a26f","block_type":"box","text":"Member States to apply position limits to the size of a net position a person can hold at any time in commodity","page_number":46,"box":{"x":70,"y":294,"width":793,"height":11}},{"id":"8eef1e68-f5d8-4a03-bd3a-3fdc335fb356","block_type":"box","text":"derivatives traded on European Union trading venues and in “economically equivalent” OTC contracts. If the","page_number":46,"box":{"x":69,"y":309,"width":765,"height":11}},{"id":"fd3c3d2e-385a-4de7-9464-5be11c6d7a77","block_type":"box","text":"requirements of EMIR and MiFID II apply, the cost of derivatives transactions is expected to increase.","page_number":46,"box":{"x":69,"y":324,"width":720,"height":11}},{"id":"3827990b-feb6-453f-82db-59693073f0e1","block_type":"box","text":"In addition, regulations adopted by global prudential regulators that are now in effect require cer tain prudentially","page_number":46,"box":{"x":102,"y":347,"width":802,"height":11}},{"id":"d381bcc9-d13e-45f5-b28b-8964250e7d62","block_type":"box","text":"regulated entities and cer tain of their affiliates and subsidiaries (including swap dealers) to include in their","page_number":46,"box":{"x":69,"y":362,"width":762,"height":11}},{"id":"2ab3a617-dbfd-482c-be9b-f835c7859e4b","block_type":"box","text":"derivatives contracts and cer tain other financial contracts, terms that delay or restrict the rights of counterpar ties","page_number":46,"box":{"x":69,"y":377,"width":810,"height":12}},{"id":"3f4bd120-f526-47f8-9b41-fbc24854ea22","block_type":"box","text":"(such as the Funds) to terminate such contracts, foreclose upon collateral, exercise other default rights or restrict","page_number":46,"box":{"x":69,"y":392,"width":812,"height":12}},{"id":"f441ec91-0c12-4fc0-83e6-cef1729b2612","block_type":"box","text":"transfers of credit suppor t in the event that the prudentially regulated entity and/or its affiliates are subject to","page_number":46,"box":{"x":68,"y":407,"width":787,"height":12}},{"id":"01c95f67-073f-4a25-b7ac-6dda920e6125","block_type":"box","text":"cer tain types of resolution or insolvency proceedings. Similar regulations and laws have been adopted in non-U.S.","page_number":46,"box":{"x":69,"y":423,"width":810,"height":11}},{"id":"767cfaae-5542-47c0-b42e-0d111048cdaa","block_type":"box","text":"jurisdictions that may apply to a Fund’s counterpar ties located in those jurisdictions. In par ticular, in the United","page_number":46,"box":{"x":67,"y":438,"width":795,"height":11}},{"id":"babe35c9-18db-4be8-a230-ad1de8f90121","block_type":"box","text":"Kingdom and the European Union, governmental authorities could reduce, eliminate or conver t to equity the liabilities","page_number":46,"box":{"x":70,"y":453,"width":835,"height":11}},{"id":"12f0f8b5-a196-41e0-8061-d70c16ac8de5","block_type":"box","text":"to a Fund of a counterpar ty experiencing financial difficulties (sometimes referred to as a “bail in”). It is possible that","page_number":46,"box":{"x":68,"y":468,"width":839,"height":11}},{"id":"7f3958e7-5741-410e-842a-e564f86f6faf","block_type":"box","text":"these requirements, as well as potential additional related government regulation, could adversely affect a Fund’s","page_number":46,"box":{"x":68,"y":483,"width":814,"height":11}},{"id":"8d2f21e5-0a88-42cb-82b8-d4363102d653","block_type":"box","text":"ability to terminate existing derivatives contracts, exercise default rights or satisfy obligations owed to it with","page_number":46,"box":{"x":69,"y":498,"width":773,"height":11}},{"id":"40e65d9a-4b34-40bf-8b59-b9d41a76f34d","block_type":"box","text":"collateral received under such contracts.","page_number":46,"box":{"x":69,"y":514,"width":288,"height":8}},{"id":"32c0f884-78ee-4b48-88b3-6f1798869224","block_type":"box","text":"Risk Factors in Derivatives.","page_number":46,"box":{"x":102,"y":536,"width":191,"height":9}},{"id":"1456eda5-3a0b-4e38-8275-ce08d9b3502a","block_type":"box","text":"There are significant risks that apply generally to derivatives transactions, including:","page_number":46,"box":{"x":101,"y":559,"width":597,"height":11}},{"id":"68a859ba-2216-44c5-8c77-fa221ca3f6e2","block_type":"box","text":"Correlation Risk","page_number":46,"box":{"x":102,"y":581,"width":114,"height":9}},{"id":"81e55a80-f032-46d1-ab66-cd1cc773dea0","block_type":"box","text":"— the risk that changes in the value of a derivative will not match the changes in the value of","page_number":46,"box":{"x":220,"y":581,"width":668,"height":12}},{"id":"04568934-44e2-45a3-bb74-f2dda1394eff","block_type":"box","text":"the por tfolio holdings that are being hedged or of the par ticular market or security to which the Fund seeks exposure.","page_number":46,"box":{"x":68,"y":596,"width":837,"height":12}},{"id":"0108bc1c-1683-4599-8c19-ea9ea9ac91d3","block_type":"box","text":"There are a number of factors which may prevent a derivative instrument from achieving the desired correlation (or","page_number":46,"box":{"x":68,"y":612,"width":818,"height":11}},{"id":"ce4b3d80-9cca-40b7-8801-1efc66c4c51d","block_type":"box","text":"inverse correlation) with an underlying asset, rate or index, such as the impact of fees, expenses and transaction","page_number":46,"box":{"x":70,"y":627,"width":806,"height":11}},{"id":"79732fbf-67b6-470c-bbf3-1d1b5bd77174","block_type":"box","text":"costs, the timing of pricing, and disruptions or illiquidity in the markets for such derivative instrument.","page_number":46,"box":{"x":69,"y":642,"width":725,"height":11}},{"id":"8aa24b91-0da2-4c3e-aa9b-2bc0be67623a","block_type":"box","text":"Counterpar ty Risk","page_number":46,"box":{"x":102,"y":665,"width":128,"height":11}},{"id":"8143f2bb-0528-4d75-ae0c-a84cadfec2b2","block_type":"box","text":"— the risk that a derivatives transaction counterpar ty will be unable or unwilling to make","page_number":46,"box":{"x":233,"y":665,"width":632,"height":11}},{"id":"ca53e3aa-3f07-4611-9891-936cb40acfbe","block_type":"box","text":"payments or otherwise honor its obligations to a Fund and the related risks of having concentrated exposure to such","page_number":46,"box":{"x":70,"y":680,"width":830,"height":11}},{"id":"1fdf5275-b407-403f-aeef-63b93853fa4a","block_type":"box","text":"a counterpar ty. In par ticular, derivatives traded in OTC markets often are not guaranteed by an exchange or clearing","page_number":46,"box":{"x":69,"y":695,"width":824,"height":11}},{"id":"c567cc3a-a80e-454c-bcee-49c974fa9510","block_type":"box","text":"corporation and often do not require payment of margin, and to the extent that the Fund has unrealized gains in such","page_number":46,"box":{"x":69,"y":710,"width":834,"height":11}},{"id":"570c23f5-9967-4bc4-9afd-c79f8216dede","block_type":"box","text":"instruments or has deposited collateral with its counterpar ties the Fund is at risk that its counterpar ties will become","page_number":46,"box":{"x":70,"y":725,"width":831,"height":11}},{"id":"346d7daa-0507-4917-a601-b0f728040515","block_type":"box","text":"bankrupt or otherwise fail to honor their obligations. A Fund will typically attempt to minimize counterpar ty risk by","page_number":46,"box":{"x":69,"y":740,"width":806,"height":11}},{"id":"3c4323c3-29e6-481e-b3c8-20f6964bc53d","block_type":"box","text":"engaging in OTC derivatives transactions only with creditwor thy entities that have substantial capital or that have","page_number":46,"box":{"x":69,"y":755,"width":803,"height":11}},{"id":"16a78e38-e340-4f8a-9247-7e63feb64146","block_type":"box","text":"provided the Fund with a third-par ty guaranty or other credit suppor t. When a Fund enters into a derivatives","page_number":46,"box":{"x":70,"y":771,"width":760,"height":11}},{"id":"0d25893f-e0c5-4c23-a777-438c78297741","block_type":"box","text":"transaction that is centrally cleared (whether mandatorily or voluntarily), the Fund is subject to the credit risk of the","page_number":46,"box":{"x":68,"y":785,"width":819,"height":12}},{"id":"287119d6-d622-42cc-95d5-51a2b6d2a70d","block_type":"box","text":"clearing house and the clearing member through which it holds its cleared position. Credit risk of market par ticipants","page_number":46,"box":{"x":69,"y":801,"width":834,"height":11}},{"id":"041ca146-a5e4-4285-bf8b-6e59ec5f9f1f","block_type":"box","text":"with respect to derivatives that are centrally cleared is concentrated in a few clearing houses and increasingly fewer","page_number":46,"box":{"x":68,"y":816,"width":826,"height":11}},{"id":"d9b845da-db83-4c9b-bd81-56d658317e0a","block_type":"box","text":"clearing members. It is not clear how an insolvency proceeding of a clearing house would be conducted and what","page_number":46,"box":{"x":69,"y":831,"width":805,"height":11}},{"id":"147b0d5b-3f85-467d-aba1-8b8b350f5ec0","block_type":"box","text":"impact an insolvency of a clearing house would have on the financial system. Also, a Fund will not be fully protected","page_number":46,"box":{"x":70,"y":846,"width":824,"height":11}},{"id":"a7acbfaf-1221-4fa0-895c-b41d0c7ec330","block_type":"box","text":"in the event of the bankruptcy of a Fund’s clearing member because the Fund would be limited to recovering only a","page_number":46,"box":{"x":70,"y":861,"width":816,"height":11}},{"id":"6bd8964d-b669-4d18-bfe5-3381414718fe","block_type":"box","text":"pro rata share of the funds held by the clearing member on behalf of customers by account class for cleared","page_number":46,"box":{"x":70,"y":876,"width":771,"height":11}},{"id":"466aed4b-87b1-49fb-b7b4-fd07f419a721","block_type":"box","text":"derivatives. Although a clearing member is required to segregate assets from customers with respect to cleared","page_number":46,"box":{"x":69,"y":891,"width":797,"height":12}},{"id":"e3e873b8-e614-448f-9378-144ba2fa5949","block_type":"box","text":"derivatives positions from the clearing member’s proprietary assets, if a clearing member does not comply with the","page_number":46,"box":{"x":69,"y":906,"width":822,"height":12}},{"id":"1a7e2282-1f4e-48d4-9685-47a02fb5adb4","block_type":"box","text":"II-15","page_number":46,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"ada1d8ec-ed7e-4369-838b-b08fa28cde70","block_type":"box","text":"NM1026U-5982568-46/232","page_number":46,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"aef67e74-bdba-48a4-a9cc-dd864b5d785c","block_type":"box","text":"applicable regulations, or in the event of fraud or misappropriation of customer assets by a clearing member, a Fund","page_number":47,"box":{"x":69,"y":45,"width":829,"height":11}},{"id":"ef1a850d-4c52-49ef-a658-fa1b0557d4fe","block_type":"box","text":"could have only an unsecured creditor claim in an insolvency of the clearing member with respect to the assets held","page_number":47,"box":{"x":69,"y":60,"width":827,"height":11}},{"id":"04123d2a-74e7-4135-92f9-e6b92ec2fb7f","block_type":"box","text":"by the clearing member.","page_number":47,"box":{"x":69,"y":75,"width":169,"height":11}},{"id":"4a047f82-75e5-4618-be1b-36ff6deaf6c3","block_type":"box","text":"Credit Risk","page_number":47,"box":{"x":102,"y":98,"width":78,"height":9}},{"id":"3997f1f1-9e51-4526-9b0d-3f02965fed30","block_type":"box","text":"— the risk that the reference entity in a credit default swap or similar derivative will not be able to","page_number":47,"box":{"x":184,"y":98,"width":698,"height":11}},{"id":"c53901ca-4d97-4bed-ba1f-6559be531b5c","block_type":"box","text":"honor its financial obligations.","page_number":47,"box":{"x":69,"y":113,"width":213,"height":11}},{"id":"70e0a829-d4bd-4a38-b232-8d683b1da104","block_type":"box","text":"Currency Risk","page_number":47,"box":{"x":102,"y":135,"width":98,"height":11}},{"id":"47afcd4d-d5e2-42ab-8ebe-e2dbb3548b89","block_type":"box","text":"— the risk that changes in the exchange rate between two currencies will adversely affect the","page_number":47,"box":{"x":204,"y":135,"width":669,"height":12}},{"id":"024cd029-2489-4c9d-8501-40bb77dc7bd2","block_type":"box","text":"value (in U.S. dollar terms) of a derivative.","page_number":47,"box":{"x":68,"y":150,"width":300,"height":11}},{"id":"df18a270-879e-4cbe-a381-70f902261a8d","block_type":"box","text":"Illiquidity Risk","page_number":47,"box":{"x":102,"y":173,"width":98,"height":11}},{"id":"0e0ebbbe-5f77-40c7-afd4-1c5a7c82239b","block_type":"box","text":"— the risk that cer tain securities or instruments may be difficult or impossible to sell at the time","page_number":47,"box":{"x":204,"y":173,"width":693,"height":11}},{"id":"a8110bd3-4231-4cb3-a392-23479869f27d","block_type":"box","text":"or at the price desired by a Fund in connection with payments of margin, collateral, or settlement payments. There","page_number":47,"box":{"x":69,"y":188,"width":814,"height":12}},{"id":"abc211d0-fb2c-4f55-b519-0d78813d91c8","block_type":"box","text":"can be no assurance that a Fund will be able to unwind or offset a derivative at its desired price, in a secondary","page_number":47,"box":{"x":69,"y":203,"width":799,"height":12}},{"id":"d84d9833-d512-49bb-89de-e4f33ef3cad7","block_type":"box","text":"market or otherwise. It may, therefore, not be possible for the Fund to unwind its position in a derivative without","page_number":47,"box":{"x":69,"y":218,"width":799,"height":12}},{"id":"c4ccf8f3-ae37-4a25-b311-edc9e1accd5e","block_type":"box","text":"incurring substantial losses (if at all). Cer tain OTC derivatives, including swaps and OTC options, involve substantial","page_number":47,"box":{"x":70,"y":234,"width":824,"height":11}},{"id":"65a105e8-9c45-43d0-b5ff-8d9acf921d76","block_type":"box","text":"illiquidity risk. Illiquidity may also make it more difficult for a Fund to ascer tain a market value for such derivatives. A","page_number":47,"box":{"x":70,"y":249,"width":830,"height":11}},{"id":"cb592eda-c8ff-4f7f-b565-e04762974c3e","block_type":"box","text":"Fund will, therefore, acquire illiquid OTC derivatives (i) if the agreement pursuant to which the instrument is","page_number":47,"box":{"x":70,"y":264,"width":762,"height":11}},{"id":"7e5a8f2f-083a-4185-82b3-41406a71b77b","block_type":"box","text":"purchased contains a formula price at which the instrument may be terminated or sold, or (ii) for which the Manager","page_number":47,"box":{"x":70,"y":279,"width":827,"height":11}},{"id":"44a787c0-b9c6-45dc-a371-ee721d20a256","block_type":"box","text":"anticipates the Fund can receive on each business day at least two independent bids or offers, unless a quotation","page_number":47,"box":{"x":69,"y":294,"width":816,"height":11}},{"id":"79123c55-3c5d-49a4-806d-b6ed0f21379e","block_type":"box","text":"from only one dealer is available, in which case that dealer’s quotation may be used. The illiquidity of the derivatives","page_number":47,"box":{"x":68,"y":309,"width":831,"height":11}},{"id":"69bccb55-7992-4953-ace7-22e052b0ae98","block_type":"box","text":"markets may be due to various factors, including congestion, disorderly markets, limitations on deliverable supplies,","page_number":47,"box":{"x":69,"y":324,"width":828,"height":12}},{"id":"77846bad-99a3-4a7a-be96-c0dbffa208ba","block_type":"box","text":"the par ticipation of speculators, government regulation and intervention, and technical and operational or system","page_number":47,"box":{"x":68,"y":339,"width":809,"height":12}},{"id":"7bf2717e-7023-4e41-8c74-443a37c910d0","block_type":"box","text":"failures. In addition, the liquidity of a market in an exchange-traded derivative contract may be adversely affected by","page_number":47,"box":{"x":68,"y":355,"width":826,"height":11}},{"id":"f8e8d424-6e9c-4661-8b16-c3ae6351b06c","block_type":"box","text":"“daily price fluctuation limits” established by the exchanges which limit the amount of fluctuation in an exchange","page_number":47,"box":{"x":70,"y":370,"width":806,"height":11}},{"id":"39939601-94d4-416e-9fc4-d5065ac986d4","block_type":"box","text":"traded contract price during a single trading day. Once the daily limit has been reached in the contract, no trades may","page_number":47,"box":{"x":68,"y":385,"width":838,"height":11}},{"id":"f7d168eb-80f9-4b52-8396-85d4ee2d8c52","block_type":"box","text":"be entered into at a price beyond the limit, thus preventing the liquidation of open positions. Prices have in the past","page_number":47,"box":{"x":69,"y":400,"width":827,"height":11}},{"id":"f49aae4f-30db-4aa4-bf1f-f314070cf8bc","block_type":"box","text":"moved to the daily limit on a number of consecutive trading days with little to no trading. If it is not possible to close","page_number":47,"box":{"x":69,"y":415,"width":828,"height":11}},{"id":"b8219b03-21bc-4930-8f91-c970ef670665","block_type":"box","text":"an open derivative position entered into by the Fund, the Fund would continue to be required to make daily cash","page_number":47,"box":{"x":69,"y":430,"width":796,"height":11}},{"id":"a9b8b8d7-c441-4f8a-8210-f0f551d34cb5","block_type":"box","text":"payments of variation margin in the event of adverse price movements. In such a situation, if the Fund has","page_number":47,"box":{"x":70,"y":445,"width":759,"height":12}},{"id":"d3b942c5-5696-44f3-9921-af16aeb58704","block_type":"box","text":"insufficient cash, it may have to sell por tfolio securities to meet daily variation margin requirements at a time when it","page_number":47,"box":{"x":70,"y":460,"width":837,"height":12}},{"id":"971cf1e5-f114-46bc-bb2e-c4938606ae3a","block_type":"box","text":"may be disadvantageous to do so.","page_number":47,"box":{"x":69,"y":476,"width":243,"height":11}},{"id":"0ee09361-47b4-426a-ac43-65a9bbdddaf8","block_type":"box","text":"Index Risk","page_number":47,"box":{"x":102,"y":498,"width":73,"height":9}},{"id":"e11daf9a-2db2-4392-be77-72f5c8e6509d","block_type":"box","text":"— if the derivative is linked to the per formance of an index, it will be subject to the risks associated","page_number":47,"box":{"x":179,"y":498,"width":714,"height":11}},{"id":"2aa45d24-0b85-43b3-baa1-a136a22585b8","block_type":"box","text":"with changes in that index. If the index changes, the Fund could receive lower interest payments or experience a","page_number":47,"box":{"x":68,"y":513,"width":800,"height":12}},{"id":"b4daacee-83b1-4402-b2a3-e52a80408b1d","block_type":"box","text":"reduction in the value of the derivative to below the price that the Fund paid for such derivative.","page_number":47,"box":{"x":69,"y":528,"width":678,"height":11}},{"id":"f5beda19-345b-4b15-a722-e736ede15458","block_type":"box","text":"Legal Risk","page_number":47,"box":{"x":102,"y":551,"width":73,"height":11}},{"id":"be55120d-17f6-435b-9cf9-cfbefad67763","block_type":"box","text":"— the risk of insufficient documentation, insufficient capacity or authority of counterpar ty, or legality","page_number":47,"box":{"x":179,"y":551,"width":717,"height":11}},{"id":"63c7ab06-376f-468e-9da3-13e915daed4b","block_type":"box","text":"or enforceability of a contract.","page_number":47,"box":{"x":69,"y":566,"width":211,"height":11}},{"id":"928a8223-2db4-4b71-8fa0-9532ec2e7380","block_type":"box","text":"Leverage Risk","page_number":47,"box":{"x":102,"y":589,"width":99,"height":11}},{"id":"0d39135a-081d-433e-b155-f3c8ce50a8e4","block_type":"box","text":"— the risk that a Fund’s derivatives transactions can magnify the Fund’s gains and losses.","page_number":47,"box":{"x":205,"y":589,"width":648,"height":11}},{"id":"6f423fdc-5734-44a6-90ea-a82f137b68cc","block_type":"box","text":"Relatively small market movements may result in large changes in the value of a derivatives position and can result","page_number":47,"box":{"x":70,"y":604,"width":823,"height":11}},{"id":"2b9796a3-f7a6-4985-a631-2d0ce92744f5","block_type":"box","text":"in losses that greatly exceed the amount originally invested.","page_number":47,"box":{"x":70,"y":619,"width":425,"height":11}},{"id":"06f78fa5-e984-4fe1-95ed-430d037669ec","block_type":"box","text":"Market Risk","page_number":47,"box":{"x":102,"y":642,"width":85,"height":9}},{"id":"0f302ad1-4fb3-4d07-92bc-4372ade2b730","block_type":"box","text":"— the risk that changes in the value of one or more markets or changes with respect to the value of","page_number":47,"box":{"x":191,"y":642,"width":716,"height":11}},{"id":"9f317bb1-7097-4bef-bd08-d28a922c8748","block_type":"box","text":"the underlying asset will adversely affect the value of a derivative. In the event of an adverse movement, a Fund may","page_number":47,"box":{"x":68,"y":657,"width":833,"height":11}},{"id":"76fdd4ab-004d-41d0-9fab-a611f184b8c9","block_type":"box","text":"be required to pay substantial additional margin to maintain its position or the Fund’s returns may be adversely","page_number":47,"box":{"x":69,"y":672,"width":794,"height":11}},{"id":"4dab5f27-b240-491f-a0a1-66d3e78a7652","block_type":"box","text":"affected.","page_number":47,"box":{"x":69,"y":687,"width":62,"height":9}},{"id":"4dc3d97d-c09f-4186-8f3b-b97ec266a87b","block_type":"box","text":"Operational Risk","page_number":47,"box":{"x":102,"y":710,"width":117,"height":11}},{"id":"c868703f-2b5d-4607-8343-8363dda9c60b","block_type":"box","text":"— the risk related to potential operational issues, including documentation issues, settlement","page_number":47,"box":{"x":223,"y":710,"width":674,"height":11}},{"id":"d112f5f1-2993-4b76-ba94-742709084f3f","block_type":"box","text":"issues, systems failures, inadequate controls and human error.","page_number":47,"box":{"x":70,"y":725,"width":451,"height":11}},{"id":"cd38531b-6f0c-43dc-a744-f763119563a2","block_type":"box","text":"Valuation Risk","page_number":47,"box":{"x":103,"y":748,"width":99,"height":9}},{"id":"4487a721-5249-48db-aaef-d8b75511b352","block_type":"box","text":"— the risk that valuation sources for a derivative will not be readily available in the market. This is","page_number":47,"box":{"x":206,"y":748,"width":701,"height":11}},{"id":"96fe3ff7-ea24-4ef4-a867-630a8dfa1618","block_type":"box","text":"possible especially in times of market distress, since many market par ticipants may be reluctant to purchase","page_number":47,"box":{"x":70,"y":763,"width":779,"height":11}},{"id":"5ac5f986-5a8a-4c75-adba-c399670b65d7","block_type":"box","text":"complex instruments or quote prices for them.","page_number":47,"box":{"x":69,"y":778,"width":329,"height":11}},{"id":"43de79a0-477c-44fa-ad21-20d35b9a02f3","block_type":"box","text":"Volatility Risk","page_number":47,"box":{"x":103,"y":801,"width":93,"height":11}},{"id":"980ef210-86d7-4132-937f-a5c73c4b1005","block_type":"box","text":"— the risk that the value of derivatives will fluctuate significantly within a shor t time period.","page_number":47,"box":{"x":200,"y":801,"width":652,"height":11}},{"id":"167c48d8-174a-49f4-bc06-3d4d39d42aba","block_type":"box","text":"Types of Derivatives Transactions.","page_number":47,"box":{"x":103,"y":823,"width":240,"height":11}},{"id":"c9b643a6-db5d-4194-80f0-870f916b92b0","block_type":"box","text":"A Fund may enter into derivatives transactions in accordance with its investment guidelines and restrictions,","page_number":47,"box":{"x":101,"y":846,"width":771,"height":11}},{"id":"f038bb95-2ef1-41a8-88d3-2d17809236ae","block_type":"box","text":"including the following:","page_number":47,"box":{"x":70,"y":861,"width":159,"height":11}},{"id":"44d5872c-353f-4c09-b50e-b1614679281d","block_type":"box","text":"Futures.","page_number":47,"box":{"x":102,"y":884,"width":56,"height":9}},{"id":"364b447e-1b16-4346-a051-74ba51f5f78e","block_type":"box","text":"II-16","page_number":47,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"33ac3b87-a976-4954-9049-797d441530f6","block_type":"box","text":"NM1026U-5982568-47/232","page_number":47,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"f43a18d4-7935-4cc8-ad22-19d23a7f5424","block_type":"box","text":"A Fund may enter into futures contracts (“futures”) and options on futures contracts. Futures are standardized,","page_number":48,"box":{"x":101,"y":45,"width":791,"height":11}},{"id":"a1f6ac7b-f296-41f5-8c29-16a137998823","block_type":"box","text":"exchange-traded contracts that require a purchaser to take delivery, and a seller to make delivery, of a specified","page_number":48,"box":{"x":69,"y":60,"width":799,"height":11}},{"id":"fe9c6d14-d086-4fb8-978e-5a2f59acbb53","block_type":"box","text":"amount of an asset at a specified future date and price. Upon purchasing or selling a futures contract, a Fund is","page_number":48,"box":{"x":69,"y":75,"width":800,"height":11}},{"id":"c2b4b94a-ebde-4cb3-949c-8c3213eb023b","block_type":"box","text":"required to deposit initial margin equal to a percentage of the contract value. Futures contracts are marked to market","page_number":48,"box":{"x":69,"y":90,"width":838,"height":11}},{"id":"4d7146dd-041d-49f3-ae93-b305a5aad3a3","block_type":"box","text":"daily for the duration of the contract, and the Fund will either post additional margin or be entitled to a payment, as","page_number":48,"box":{"x":69,"y":105,"width":820,"height":11}},{"id":"bf7f1f5f-62b4-4f9d-83b1-48547d6efa05","block_type":"box","text":"applicable, based on the mark-to-market movement of the contract.","page_number":48,"box":{"x":69,"y":120,"width":478,"height":11}},{"id":"d439b3ec-da78-40bd-aba3-901f72d81fa4","block_type":"box","text":"A Fund may sell a futures contract prior to the completion of its term to limit its risk of loss from a decline in the","page_number":48,"box":{"x":101,"y":143,"width":801,"height":11}},{"id":"91015d6d-7b0d-48e0-9410-397812bc182a","block_type":"box","text":"market value of por tfolio holdings correlated with the futures contract. However, in the event the market value of the","page_number":48,"box":{"x":69,"y":158,"width":829,"height":11}},{"id":"fbee3412-b895-40f2-920c-025cf49a1d63","block_type":"box","text":"por tfolio holdings correlated with the futures contract increases rather than decreases, a Fund will realize a loss on","page_number":48,"box":{"x":70,"y":173,"width":822,"height":11}},{"id":"a144ee81-6bf3-47d8-9be7-87d74204580c","block_type":"box","text":"the futures position and a lower return on the por tfolio holdings than would have been realized without the purchase","page_number":48,"box":{"x":68,"y":188,"width":830,"height":12}},{"id":"4c1ede24-1ece-43cf-a9f9-7337fa431d39","block_type":"box","text":"of the futures contract.","page_number":48,"box":{"x":69,"y":203,"width":162,"height":9}},{"id":"092dd9bb-00d1-4d1d-824a-58160d3e0ae4","block_type":"box","text":"The purchase of a futures contract may provide a Fund a lower cost alternative to purchasing securities or","page_number":48,"box":{"x":101,"y":226,"width":756,"height":11}},{"id":"ccbce2e9-6aba-4f51-9039-1ba0e93c2c3c","block_type":"box","text":"commodities directly. In the event that such securities or commodities decline in value or a Fund determines not to","page_number":48,"box":{"x":69,"y":241,"width":820,"height":11}},{"id":"028e6c24-21c9-45a6-a5b4-d1d0ef2de5e9","block_type":"box","text":"complete an anticipatory hedge transaction relating to a futures contract, however, the Fund may realize a loss","page_number":48,"box":{"x":69,"y":256,"width":789,"height":12}},{"id":"7e7caa90-0e0e-47a0-a171-57ba2e80fae7","block_type":"box","text":"relating to the futures position.","page_number":48,"box":{"x":69,"y":271,"width":219,"height":12}},{"id":"5984f566-8481-426b-b70e-923ec48df9e8","block_type":"box","text":"Futures contracts are also subject to position limits. In order to comply with position limits, a Fund may be","page_number":48,"box":{"x":102,"y":294,"width":757,"height":11}},{"id":"7b99573a-05e4-494f-889e-ee635d402b96","block_type":"box","text":"required to liquidate positions or may not be able to fully implement trading instructions. Any such liquidation or","page_number":48,"box":{"x":69,"y":309,"width":797,"height":11}},{"id":"c7bb5732-2c34-4db6-8edc-b4497fe52248","block_type":"box","text":"limited implementation could result in substantial costs to a Fund. See “—Regulation of Derivatives — Dodd-Frank","page_number":48,"box":{"x":70,"y":324,"width":816,"height":12}},{"id":"17c4f94f-0319-40e4-8ec7-d96938fc5f04","block_type":"box","text":"Regulations” above.","page_number":48,"box":{"x":70,"y":340,"width":140,"height":11}},{"id":"ba5777c2-d573-4a66-85f7-c027dd427dab","block_type":"box","text":"A Fund is also permitted to purchase or sell call and put options on futures contracts, including financial futures","page_number":48,"box":{"x":101,"y":362,"width":799,"height":11}},{"id":"d680eac0-ff50-4fbd-a83d-56b76c0472a8","block_type":"box","text":"and stock indices. Generally, these strategies would be used under the same market and market sector conditions","page_number":48,"box":{"x":69,"y":377,"width":818,"height":12}},{"id":"1812f76f-6604-4f19-9979-899c8b48d3cb","block_type":"box","text":"(","page_number":48,"box":{"x":69,"y":393,"width":3,"height":10}},{"id":"2b4c79a4-2173-425d-8d63-a2959e51d12d","block_type":"box","text":"i.e.","page_number":48,"box":{"x":74,"y":393,"width":21,"height":8}},{"id":"ac58f892-b570-4cc2-b1e6-c4e8a8a5feb4","block_type":"box","text":", conditions relating to specific types of investments) in which the Fund entered into futures transactions. A Fund","page_number":48,"box":{"x":97,"y":392,"width":803,"height":12}},{"id":"81f762e1-1df0-461b-8f08-697c927f5239","block_type":"box","text":"may purchase put options or write call options on futures contracts and stock indices in lieu of selling the underlying","page_number":48,"box":{"x":69,"y":407,"width":830,"height":12}},{"id":"94e6071d-9ebe-4715-8644-ff66fb7a2d25","block_type":"box","text":"futures contract in anticipation of a decrease in the market value of its securities. Similarly, a Fund can purchase call","page_number":48,"box":{"x":68,"y":423,"width":835,"height":11}},{"id":"0111cf64-c8d8-4a87-8fcb-776064a88f36","block_type":"box","text":"options, or write put options on futures contracts and stock indices, as a substitute for the purchase of such futures","page_number":48,"box":{"x":69,"y":438,"width":831,"height":11}},{"id":"e6b45035-6ec4-49e8-af79-f26abf12d972","block_type":"box","text":"contracts to hedge against the increased cost resulting from an increase in the market value of securities which the","page_number":48,"box":{"x":69,"y":453,"width":826,"height":11}},{"id":"7fc46dc9-25e7-4537-bdb6-4d84ae35b968","block_type":"box","text":"Fund intends to purchase.","page_number":48,"box":{"x":70,"y":468,"width":183,"height":11}},{"id":"b3dd644e-4cf5-45c2-9f6d-c33d97dd4eaf","block_type":"box","text":"To maintain greater flexibility, a Fund may invest in instruments which have characteristics similar to futures","page_number":48,"box":{"x":101,"y":491,"width":768,"height":11}},{"id":"9584f427-514f-47e2-8f61-19c4c9158aa4","block_type":"box","text":"contracts. These instruments may take a variety of forms, such as debt securities with interest or principal payments","page_number":48,"box":{"x":69,"y":506,"width":835,"height":11}},{"id":"4c70bdc0-5b8f-4fc3-85a6-188e5de82c73","block_type":"box","text":"determined by reference to the value of a security, an index of securities or a commodity at a future point in time. The","page_number":48,"box":{"x":69,"y":521,"width":839,"height":11}},{"id":"0e574f2c-d410-4381-a743-2f8378a5e760","block_type":"box","text":"risks of such investments could reflect the risks of investing in futures and securities, including volatility and","page_number":48,"box":{"x":69,"y":536,"width":773,"height":11}},{"id":"01929ebe-5098-4576-9890-6026d9fe2486","block_type":"box","text":"illiquidity.","page_number":48,"box":{"x":70,"y":551,"width":63,"height":11}},{"id":"63eb8740-d558-4476-92ba-1b59a905c0c4","block_type":"box","text":"Futures contracts and options on futures contracts are subject to significant correlation risk, leverage risk,","page_number":48,"box":{"x":102,"y":574,"width":757,"height":11}},{"id":"1bca3966-01f0-496b-b198-b82bd6fa4d9d","block_type":"box","text":"illiquidity risk, market risk and counterpar ty risk with respect to a Fund’s futures broker or the clearinghouse. See","page_number":48,"box":{"x":70,"y":589,"width":807,"height":11}},{"id":"009e79b9-21a6-4652-bbf4-ad8917d24277","block_type":"box","text":"“—Risk Factors in Derivatives” above.","page_number":48,"box":{"x":70,"y":604,"width":269,"height":9}},{"id":"c2de2867-f28a-4921-98d7-ed905ad486af","block_type":"box","text":"Cer tain Funds may invest in futures based on carbon “allowances.” Under cer tain regulatory regimes, a limit is","page_number":48,"box":{"x":102,"y":627,"width":791,"height":11}},{"id":"96a1381f-e346-4350-bdf8-a13af3d239f0","block_type":"box","text":"set by a regulator, such as a government entity, on the total amount of specific greenhouse gases, such as CO2, that","page_number":48,"box":{"x":69,"y":642,"width":838,"height":11}},{"id":"57821a75-e07f-4968-b5cb-a46d04b28444","block_type":"box","text":"can be emitted by regulated entities, such as manufacturers or energy producers. The regulator then may issue or","page_number":48,"box":{"x":69,"y":657,"width":814,"height":11}},{"id":"b9112419-7b09-48b9-9da0-f6677d9c25fb","block_type":"box","text":"sell individual “emission allowances” to regulated entities, which can then be traded on the open market. Commodity","page_number":48,"box":{"x":69,"y":672,"width":837,"height":11}},{"id":"54ae3c96-7b19-4c5b-9e4c-12e65a539e8d","block_type":"box","text":"futures contracts linked to the value of emission allowances are known as “carbon futures.”","page_number":48,"box":{"x":68,"y":687,"width":657,"height":9}},{"id":"4e3782af-a130-4711-a149-57fa7619c5ef","block_type":"box","text":"The price for carbon futures contracts is based on a number of factors, including the supply of and the demand","page_number":48,"box":{"x":101,"y":710,"width":792,"height":11}},{"id":"7ef92a2e-12b0-43f6-8357-196d19cab8c1","block_type":"box","text":"for carbon futures contracts. Changes in law, market conditions and expectations, position limits, collateral","page_number":48,"box":{"x":68,"y":725,"width":764,"height":11}},{"id":"128aa32b-66f7-4af8-8a36-b25ccad09e79","block_type":"box","text":"requirements, and other factors each can impact the supply of and demand for carbon futures contracts. The market","page_number":48,"box":{"x":69,"y":740,"width":832,"height":11}},{"id":"b3e76486-1501-4b40-9e2e-ebd057d1d80b","block_type":"box","text":"for carbon futures contracts is still developing and may be subject to periods of illiquidity. During such times it may be","page_number":48,"box":{"x":68,"y":755,"width":841,"height":11}},{"id":"3feb1d3d-1d2f-4069-8158-eecbd72d3d5d","block_type":"box","text":"difficult or impossible to buy or sell a position at the desired price. Market disruptions or volatility can also make it","page_number":48,"box":{"x":69,"y":770,"width":819,"height":11}},{"id":"2eb3343a-edc4-4441-a0f1-29e1f215ed67","block_type":"box","text":"difficult to find a counterpar ty willing to transact at a reasonable price and sufficient size.","page_number":48,"box":{"x":69,"y":785,"width":637,"height":12}},{"id":"330ebfb4-3fba-4c55-a5f4-e510fb563514","block_type":"box","text":"Swap Agreements.","page_number":48,"box":{"x":102,"y":808,"width":131,"height":11}},{"id":"55323934-54d9-48f8-a5ff-8f617b684625","block_type":"box","text":"A Fund may enter into swap agreements for hedging purposes or speculative purposes. Swap agreements are","page_number":48,"box":{"x":101,"y":831,"width":782,"height":11}},{"id":"049ec15c-d87a-4bf5-95bf-0e4804769baf","block_type":"box","text":"OTC contracts entered into primarily by financial institutions and institutional investors which may or may not be","page_number":48,"box":{"x":69,"y":846,"width":796,"height":11}},{"id":"eb7b08bd-e013-4d5a-a779-f4c249114e50","block_type":"box","text":"cleared by a central clearinghouse. In a standard “swap” transaction, two par ties agree to exchange the returns","page_number":48,"box":{"x":69,"y":861,"width":799,"height":11}},{"id":"88dc909f-3562-4985-a4d8-b6fa11dc42d8","block_type":"box","text":"earned or realized from one or more underlying assets or rates of return, which may be adjusted for an interest","page_number":48,"box":{"x":69,"y":876,"width":792,"height":11}},{"id":"74f69712-e9b5-4ed7-b0f2-6c61c3c9280f","block_type":"box","text":"factor. The gross returns to be exchanged or “swapped” between the par ties are generally calculated with respect to","page_number":48,"box":{"x":68,"y":891,"width":832,"height":12}},{"id":"9ddad240-d6e5-48c1-8e07-1e9a24f619d0","block_type":"box","text":"a “notional amount,”","page_number":48,"box":{"x":69,"y":907,"width":147,"height":10}},{"id":"5791f9b5-e98d-496d-b255-b578a4a36b8c","block_type":"box","text":"e.g.","page_number":48,"box":{"x":223,"y":908,"width":25,"height":10}},{"id":"d001ac09-0a77-4e4e-a2e1-d4152b6dd248","block_type":"box","text":", the return or increase in value of a par ticular dollar amount invested at a par ticular","page_number":48,"box":{"x":251,"y":906,"width":602,"height":11}},{"id":"91500556-c807-4393-9a01-5ef0a556ddb5","block_type":"box","text":"II-17","page_number":48,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"c848427e-aef8-49ec-9481-f95ab56ae5df","block_type":"box","text":"NM1026U-5982568-48/232","page_number":48,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"87ead513-a434-401b-b050-816a29a336e7","block_type":"box","text":"interest rate, in a par ticular foreign currency, or in a “basket” of securities representing a par ticular index. The","page_number":49,"box":{"x":70,"y":45,"width":787,"height":11}},{"id":"972240cd-fb7c-45f9-81aa-c66dade79cee","block_type":"box","text":"notional amount of the swap agreement is only used to calculate the obligations that the par ties to a swap","page_number":49,"box":{"x":69,"y":60,"width":762,"height":11}},{"id":"454362b9-f278-4010-b69b-94f8528622ca","block_type":"box","text":"agreement have agreed to exchange. A Fund’s obligations (or rights) under a swap agreement will generally be equal","page_number":49,"box":{"x":69,"y":75,"width":828,"height":11}},{"id":"fae27029-b117-47a1-bdda-65d4dcd141b3","block_type":"box","text":"only to the net amount to be paid or received under the agreement based on the relative values of the positions held","page_number":49,"box":{"x":69,"y":90,"width":832,"height":11}},{"id":"5f686516-f08f-4612-984d-3a3fc3e06d78","block_type":"box","text":"by each par ty to the agreement. Swaps that are not cleared involve substantial counterpar ty risk. A Fund will typically","page_number":49,"box":{"x":69,"y":105,"width":835,"height":11}},{"id":"6eb8a0b2-86c2-493b-bbed-e8aa996e33b2","block_type":"box","text":"attempt to mitigate this counterpar ty risk by entering into swap agreements only with creditwor thy entities that have","page_number":49,"box":{"x":69,"y":120,"width":826,"height":12}},{"id":"03ce2c88-62af-4546-9cfd-677f6663dfd4","block_type":"box","text":"substantial capital or that have provided the Fund with a third-par ty guaranty or other credit suppor t. A Fund’s ability","page_number":49,"box":{"x":69,"y":136,"width":827,"height":11}},{"id":"43f395a1-1653-4403-b7cf-c8f13bcb6f3c","block_type":"box","text":"to use swap agreements may be restricted by the tax rules applicable to registered investment companies.","page_number":49,"box":{"x":68,"y":151,"width":763,"height":11}},{"id":"b88fa564-e186-4e83-ae75-fdfe2cc26847","block_type":"box","text":"Credit Default Swaps and Similar Instruments.","page_number":49,"box":{"x":102,"y":173,"width":329,"height":11}},{"id":"7596abcd-1e20-4245-a8d7-a84e7c1e594d","block_type":"box","text":"Cer tain Funds may enter into credit default swaps and similar","page_number":49,"box":{"x":438,"y":173,"width":439,"height":11}},{"id":"10c0a72d-cfa2-486a-b6d4-fe389c8315b5","block_type":"box","text":"instruments. Credit default swaps are standardized agreements in which the protection “buyer” pays the protection","page_number":49,"box":{"x":70,"y":188,"width":821,"height":12}},{"id":"dd233289-a4a0-4078-875f-e6ceb7277dff","block_type":"box","text":"“seller” an up-front payment, or a periodic stream of payments, over the term of the contract, provided generally that","page_number":49,"box":{"x":70,"y":203,"width":831,"height":12}},{"id":"0658016a-07ff-4c09-93b7-03a49d41c0bd","block_type":"box","text":"no credit event on a reference obligation has occurred. If a credit event occurs, the seller generally must pay the","page_number":49,"box":{"x":69,"y":218,"width":801,"height":12}},{"id":"e2045d95-6a20-440c-9d53-dce7ae86f1ef","block_type":"box","text":"buyer the difference between the notional amount of the contract and the value of a por tfolio of securities issued by","page_number":49,"box":{"x":69,"y":234,"width":829,"height":11}},{"id":"d793babf-af80-40ef-8fea-cb8f0a25ea47","block_type":"box","text":"the reference entity. A Fund may be either the buyer or seller in the transaction. The Funds may enter into credit","page_number":49,"box":{"x":68,"y":249,"width":798,"height":11}},{"id":"df191a77-b9d3-41c8-a34f-f1c8c1119aaa","block_type":"box","text":"default swaps that reference the obligations of a single entity (“single-name CDS”) or the obligations of entities that","page_number":49,"box":{"x":69,"y":264,"width":827,"height":11}},{"id":"59d22b12-3e86-4788-a501-253163c66bf1","block_type":"box","text":"make up an index (“index CDS”). References to “credit default swaps” shall collectively refer to single-name CDS and","page_number":49,"box":{"x":69,"y":279,"width":836,"height":11}},{"id":"357c5550-e1b5-428c-a9f1-8fda5bdb2595","block_type":"box","text":"index CDS.","page_number":49,"box":{"x":70,"y":294,"width":75,"height":9}},{"id":"c728989e-2366-455a-8d60-14f005ffadae","block_type":"box","text":"Credit default swaps have as reference obligations one or more securities or loans that are not currently held by","page_number":49,"box":{"x":102,"y":317,"width":800,"height":11}},{"id":"80dbc86b-0500-4217-b8de-3f04b188fd23","block_type":"box","text":"a Fund. In circumstances in which a Fund does not own the securities or loans that are deliverable under a credit","page_number":49,"box":{"x":69,"y":332,"width":806,"height":9}},{"id":"7cb904a9-1640-44b6-8ea3-65dfb0d43f72","block_type":"box","text":"default swap, the Fund is exposed to the risk that deliverable securities will not be available in the market, or will be","page_number":49,"box":{"x":69,"y":347,"width":828,"height":11}},{"id":"b7db1938-5e54-42df-943f-130e88a18de6","block_type":"box","text":"available only at unfavorable prices, as would be the case in a so-called “shor t squeeze.” In cer tain instances of","page_number":49,"box":{"x":69,"y":362,"width":804,"height":11}},{"id":"de5d5d64-1612-4622-a8ff-21587d4ea6ff","block_type":"box","text":"issuer defaults or restructurings, it has been unclear under the standard industry documentation for credit default","page_number":49,"box":{"x":70,"y":377,"width":812,"height":12}},{"id":"7690f091-6dc1-47f1-8b93-5b4b120b5a68","block_type":"box","text":"swaps whether or not a “credit event” triggering the seller’s payment obligation had occurred. Cer tain initiatives","page_number":49,"box":{"x":69,"y":392,"width":798,"height":12}},{"id":"61e63cb2-f055-43e2-8f73-ab8359010824","block_type":"box","text":"adopted by derivatives market par ticipants, including the International Swaps and Derivatives Association (“ISDA”),","page_number":49,"box":{"x":69,"y":408,"width":819,"height":11}},{"id":"c2d0a2f4-a9f8-481c-bf6e-70ca2dfa35e0","block_type":"box","text":"are designed to implement uniform settlement terms into standard credit default swap documentation, as well as","page_number":49,"box":{"x":69,"y":423,"width":810,"height":11}},{"id":"18c68368-0002-4508-8b35-f28c2b8f647f","block_type":"box","text":"refine the practices for the transparent conduct of the credit default swap market generally. Among these initiatives","page_number":49,"box":{"x":69,"y":438,"width":821,"height":11}},{"id":"bf302d96-8168-4f2b-9738-924916b49ba1","block_type":"box","text":"are the ISDA Credit Derivatives Determination Committee and the implementation of market-wide cash settlement","page_number":49,"box":{"x":69,"y":453,"width":811,"height":11}},{"id":"ab736596-0e8f-462c-8850-a5bd697b6737","block_type":"box","text":"protocols applicable to all market-standard credit default swaps. These initiatives are intended to reduce both the","page_number":49,"box":{"x":70,"y":468,"width":809,"height":11}},{"id":"e6507442-94f2-4061-8bb2-ce1f6500f9f2","block_type":"box","text":"uncer tainty as to the occurrence of credit events and the risk of a “shor t squeeze” by providing that the ISDA Credit","page_number":49,"box":{"x":69,"y":483,"width":827,"height":11}},{"id":"415102e3-ef44-421c-a239-f143e1b9c67b","block_type":"box","text":"Derivatives Determinations Committee will make determinations as to whether a credit event has occurred, establish","page_number":49,"box":{"x":70,"y":498,"width":834,"height":11}},{"id":"a060c6a4-3991-4391-8788-52f9a08b451a","block_type":"box","text":"an auction to determine a settlement price and identify the deliverable securities for purposes of the auction,","page_number":49,"box":{"x":69,"y":513,"width":778,"height":11}},{"id":"373a6752-fd08-45e1-9ebf-c6d75e65a7f7","block_type":"box","text":"although the ISDA Credit Derivatives Determinations Committee may in cer tain limited circumstances refrain from","page_number":49,"box":{"x":69,"y":528,"width":809,"height":12}},{"id":"2de5e3d6-12ad-4d71-bc51-3d34b9adea0a","block_type":"box","text":"doing so. In the event the ISDA Credit Derivatives Determinations Committee cannot reach a timely resolution with","page_number":49,"box":{"x":69,"y":544,"width":815,"height":11}},{"id":"997953c3-cd30-4f60-b51d-6a77dda3cb00","block_type":"box","text":"respect to a “credit event” or otherwise does not establish a cash settlement auction, a Fund may not be able to","page_number":49,"box":{"x":69,"y":559,"width":807,"height":11}},{"id":"47c43822-8574-4ea6-8f92-21d8804bdf6a","block_type":"box","text":"realize the full value of the credit default swap upon a default by the reference entity. Fur thermore, a Fund may enter","page_number":49,"box":{"x":69,"y":574,"width":832,"height":11}},{"id":"5164d3b5-2fdf-4450-b9cb-0aa1ae868909","block_type":"box","text":"into cer tain credit default swaps or similar instruments that may not be covered by these initiatives.","page_number":49,"box":{"x":70,"y":589,"width":711,"height":11}},{"id":"ce692b26-9884-4bba-8c03-206c634af880","block_type":"box","text":"If a Fund is a buyer, it will lose the payments made under the terms of the credit default swap and recover","page_number":49,"box":{"x":102,"y":612,"width":757,"height":11}},{"id":"5da585df-6472-48fb-8dd9-b4e5036a2891","block_type":"box","text":"nothing should no credit event occur. If a Fund is a seller and a credit event occurs, the value of any deliverable","page_number":49,"box":{"x":69,"y":627,"width":794,"height":11}},{"id":"59932734-957e-455f-9163-58d996f95ca8","block_type":"box","text":"obligation received by the Fund or the amount of cash settlement received by the Fund pursuant to the relevant cash","page_number":49,"box":{"x":69,"y":642,"width":830,"height":11}},{"id":"d1923aeb-0cc8-424f-8997-b6d6ddd75124","block_type":"box","text":"settlement auction, together with the up-front or periodic payments previously received, may be less than the amount","page_number":49,"box":{"x":69,"y":657,"width":835,"height":11}},{"id":"17652ef5-ef84-4ee8-8b9b-a79f2fa1b6b7","block_type":"box","text":"it pays to the buyer, resulting in a loss of value to the Fund. A Fund that sells credit default swaps incurs leveraged","page_number":49,"box":{"x":70,"y":672,"width":817,"height":11}},{"id":"2cddaba8-25e6-48c6-8922-33a425c62446","block_type":"box","text":"exposure to the credit of one or more reference entities and is subject to many of the same risks it would incur if it","page_number":49,"box":{"x":69,"y":687,"width":820,"height":11}},{"id":"a9a3ece5-1c18-47fd-a1c4-c90adf8cd3b2","block_type":"box","text":"were holding debt securities issued by the relevant reference entity. However, a Fund will not have any legal recourse","page_number":49,"box":{"x":68,"y":702,"width":833,"height":12}},{"id":"e0e2d23f-8c4a-4169-afc8-4cab6c9d063f","block_type":"box","text":"against any reference entity and will not benefit from any collateral securing the reference entity’s debt obligations. In","page_number":49,"box":{"x":69,"y":717,"width":837,"height":12}},{"id":"cad210bc-9649-425b-adf3-29a64cdbbda0","block_type":"box","text":"the event the ISDA Credit Derivatives Determinations Committee does not establish a cash settlement auction and","page_number":49,"box":{"x":68,"y":733,"width":820,"height":9}},{"id":"88c308c6-d21b-4458-974f-eabff4e80e17","block_type":"box","text":"identify the relevant deliverable securities or loans, the credit default swap buyer will have broad discretion to select","page_number":49,"box":{"x":70,"y":748,"width":828,"height":11}},{"id":"74bb7de0-8575-4ebc-8097-45be4f948e92","block_type":"box","text":"which of the reference entity’s debt obligations to deliver to the Fund following a credit event and will likely choose","page_number":49,"box":{"x":68,"y":763,"width":815,"height":11}},{"id":"6475c3fe-4558-44d0-b37c-f33a246ca23e","block_type":"box","text":"the obligations with the lowest market value in order to maximize the payment obligations of the Fund. In addition,","page_number":49,"box":{"x":68,"y":778,"width":814,"height":11}},{"id":"3d6743ee-789f-4b50-a97b-6122bd534915","block_type":"box","text":"credit default swaps generally trade on the basis of theoretical pricing and valuation models, which may not","page_number":49,"box":{"x":69,"y":793,"width":766,"height":11}},{"id":"a3fbf160-520e-4e18-bc09-7d9c5ed2fc30","block_type":"box","text":"accurately value such swap positions when established or when subsequently traded or unwound under actual market","page_number":49,"box":{"x":69,"y":808,"width":840,"height":11}},{"id":"503fbb2f-7a97-472d-b494-64cc925e8e8f","block_type":"box","text":"conditions.","page_number":49,"box":{"x":69,"y":823,"width":76,"height":9}},{"id":"2e2038b4-569d-43eb-98a9-6545062f1738","block_type":"box","text":"Dodd-Frank requires that cer tain index CDS be executed in regulated markets and submitted for clearing to","page_number":49,"box":{"x":102,"y":846,"width":762,"height":11}},{"id":"0b91075f-7fa6-4e16-b9e2-2bdcc692fc90","block_type":"box","text":"regulated clearinghouses. See “—Derivatives — Regulation of Derivatives — Dodd-Frank Regulations” above. Other","page_number":49,"box":{"x":69,"y":861,"width":824,"height":11}},{"id":"2327517d-33ab-40cc-b0a8-a8335eae1774","block_type":"box","text":"single-name CDS and index CDS are permitted, although not required, to be cleared through regulated","page_number":49,"box":{"x":69,"y":876,"width":727,"height":11}},{"id":"a9445777-f3b5-44b6-aad4-f806daf5bb24","block_type":"box","text":"clearinghouses. The Funds clear all credit default swaps that are subject to mandatory clearing and may voluntarily","page_number":49,"box":{"x":69,"y":891,"width":819,"height":12}},{"id":"b567f608-5385-443e-88ed-46648886554a","block_type":"box","text":"clear some, but not all, of the other credit default swaps not subject to mandatory clearing. The Funds face","page_number":49,"box":{"x":69,"y":906,"width":764,"height":12}},{"id":"2c402808-6cc6-46be-a7ae-178024bb5644","block_type":"box","text":"II-18","page_number":49,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"d46ddc80-5e75-4770-80af-004452d489d9","block_type":"box","text":"NM1026U-5982568-49/232","page_number":49,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"4783b916-1f0b-4299-950f-9a550682b01b","block_type":"box","text":"counterpar ty risk with respect to the clearinghouse when entering into cleared single-name CDS and cleared index","page_number":50,"box":{"x":69,"y":45,"width":813,"height":11}},{"id":"4a86ae36-ef52-4d8f-9b31-6179f0e0a51f","block_type":"box","text":"CDS. The Funds face significant counterpar ty risk with respect to their counterpar ties to non-cleared credit default","page_number":50,"box":{"x":69,"y":60,"width":813,"height":11}},{"id":"798b33a0-e53e-45ad-a1a7-9884a18e7c51","block_type":"box","text":"swaps and similar instruments. A Fund typically will enter into non-cleared credit default swaps and similar","page_number":50,"box":{"x":69,"y":75,"width":759,"height":11}},{"id":"602fa202-78ad-4ab6-ad3c-e85ced8e39af","block_type":"box","text":"instruments with swap dealers and creditwor thy entities that have substantial capital or that have provided the Fund","page_number":50,"box":{"x":70,"y":90,"width":828,"height":11}},{"id":"618143d7-8e03-4684-80cd-83b1f9396273","block_type":"box","text":"with a third-par ty guaranty or other credit suppor t.","page_number":50,"box":{"x":68,"y":105,"width":355,"height":11}},{"id":"9e48dca6-d12f-4035-9533-4c9521e635d6","block_type":"box","text":"In cer tain instances, a Fund may enter into bespoke credit default swaps or similar instruments either as","page_number":50,"box":{"x":102,"y":128,"width":750,"height":11}},{"id":"4facabd6-fa52-458c-aaa9-d3eb824b0b60","block_type":"box","text":"protection buyer or protection seller. While these contracts are similar in their operation to the market-standard credit","page_number":50,"box":{"x":70,"y":143,"width":836,"height":11}},{"id":"2815c4d4-1c05-49b2-8000-ec01154212c3","block_type":"box","text":"default swaps described above, they are less standardized and instead have bespoke or tailored features. For","page_number":50,"box":{"x":69,"y":158,"width":785,"height":11}},{"id":"559da110-23b0-42a1-be83-35165a3a7d3e","block_type":"box","text":"example, as compared to market-standard credit defaults, the range of “credit events” triggering settlement of such","page_number":50,"box":{"x":69,"y":173,"width":825,"height":11}},{"id":"501e1181-b056-470d-b515-492f26d30aa0","block_type":"box","text":"bespoke contracts may be narrower or broader, any such triggered contracts are settled by physical delivery of the","page_number":50,"box":{"x":69,"y":188,"width":814,"height":12}},{"id":"becde448-b28b-4eec-aaa0-507e3e58ec74","block_type":"box","text":"underlying security or loan to or by the Fund rather than by way of cash settlement, and there may be a wider range of","page_number":50,"box":{"x":69,"y":203,"width":839,"height":12}},{"id":"4fb239f9-256d-44bd-af4d-d9ee6b638ff8","block_type":"box","text":"securities as the reference obligations and/or deliverable obligations.","page_number":50,"box":{"x":69,"y":218,"width":495,"height":12}},{"id":"6998fb20-fac5-40a0-8b9f-9c41e95b4798","block_type":"box","text":"In addition, credit default swaps and similar instruments generally involve greater risks than if a Fund had","page_number":50,"box":{"x":102,"y":241,"width":752,"height":11}},{"id":"d4822713-ed8f-4074-9d5f-06109935a352","block_type":"box","text":"invested in the reference obligation directly and are subject to significant credit risk, correlation risk, leverage risk,","page_number":50,"box":{"x":70,"y":256,"width":814,"height":12}},{"id":"99df4f99-61df-4112-815c-bafaf32a08cd","block_type":"box","text":"illiquidity risk and market risk. See “—Risk Factors in Derivatives” above.","page_number":50,"box":{"x":70,"y":272,"width":520,"height":11}},{"id":"f18b0518-4904-4fa1-9c1a-57f252e2ad79","block_type":"box","text":"Interest Rate Swaps, Floors and Caps.","page_number":50,"box":{"x":102,"y":294,"width":273,"height":11}},{"id":"93cfbb60-d20f-4e52-bca1-05c21cf8b904","block_type":"box","text":"Cer tain Funds may enter into OTC derivatives in the form of interest rate","page_number":50,"box":{"x":381,"y":294,"width":515,"height":11}},{"id":"e80d2bd6-6601-496a-9461-b3ae0cd310a3","block_type":"box","text":"swaps and interest rate caps and floors. As described in fur ther detail below, a Fund may enter into these","page_number":50,"box":{"x":69,"y":309,"width":755,"height":11}},{"id":"037c56f2-e00c-427c-a705-8c9dd2b47e29","block_type":"box","text":"transactions primarily to preserve a return or spread on a par ticular investment or por tion of its holdings, as a","page_number":50,"box":{"x":68,"y":324,"width":788,"height":12}},{"id":"bf3d86b8-90c6-4e01-8b28-b80762dcff33","block_type":"box","text":"duration management technique, to protect against an increase in the price of securities a Fund anticipates","page_number":50,"box":{"x":69,"y":339,"width":768,"height":12}},{"id":"224e5c88-7dad-40d3-afdd-4c2c7a11c7b6","block_type":"box","text":"purchasing at a later date, or for speculation to increase returns.","page_number":50,"box":{"x":70,"y":355,"width":461,"height":11}},{"id":"8a8e9717-9aa9-4fc4-9ab2-ba72bf026271","block_type":"box","text":"Dodd-Frank requires that cer tain interest rate swaps be executed in regulated markets and submitted for","page_number":50,"box":{"x":102,"y":377,"width":748,"height":12}},{"id":"75d738fe-20fd-46b1-88b0-6157c75b8e58","block_type":"box","text":"clearing to regulated clearinghouses. See “—Regulation of Derivatives — Dodd-Frank Regulations” above. Other","page_number":50,"box":{"x":69,"y":392,"width":799,"height":12}},{"id":"9044378f-bc40-4e56-8460-2889d7ecfa2d","block_type":"box","text":"interest rate swaps are permitted, although not required, to be cleared. Most of the interest rate swaps entered into","page_number":50,"box":{"x":70,"y":407,"width":829,"height":12}},{"id":"6fbf28c3-8558-4ee9-9837-b6c6c703b3b9","block_type":"box","text":"by the Funds are cleared. The Funds face counterpar ty risk with respect to the clearinghouse when entering into","page_number":50,"box":{"x":69,"y":423,"width":797,"height":11}},{"id":"ece09d14-b559-4caf-ada1-8100ce5d8443","block_type":"box","text":"cleared interest rate swaps.","page_number":50,"box":{"x":69,"y":438,"width":198,"height":11}},{"id":"c6bf24eb-fef1-4c57-a321-495e63fca9b9","block_type":"box","text":"The Funds face significant counterpar ty risk with respect to their counterpar ties to non-cleared interest rate","page_number":50,"box":{"x":101,"y":460,"width":766,"height":12}},{"id":"cdf06492-f38a-4223-9503-ef3cf7978ab7","block_type":"box","text":"swaps and interest rate caps and floors. The typical counterpar ties for a Fund’s non-cleared interest rate derivatives","page_number":50,"box":{"x":69,"y":475,"width":829,"height":12}},{"id":"99a2cdf6-5ca7-4d12-9d89-441ec21f6f15","block_type":"box","text":"transactions are swap dealers and other creditwor thy entities that have substantial capital or that have provided the","page_number":50,"box":{"x":68,"y":491,"width":830,"height":11}},{"id":"7d70add9-e2eb-44e5-b580-bafc05c7acec","block_type":"box","text":"Fund with a third-par ty guaranty or other credit suppor t. If the Fund’s counterpar ty defaults on such a transaction, a","page_number":50,"box":{"x":70,"y":506,"width":822,"height":11}},{"id":"b4b1f1bd-fb3a-4291-a580-b8cdc659b40a","block_type":"box","text":"Fund will have contractual remedies with respect to the transaction but there can be no guarantee that the Fund will","page_number":50,"box":{"x":70,"y":521,"width":824,"height":11}},{"id":"83dfa9ad-9dae-4ee5-a299-0b6fd5e54f7b","block_type":"box","text":"be successful in enforcing such remedies. The market for interest rate swaps is relatively liquid in comparison with","page_number":50,"box":{"x":69,"y":536,"width":819,"height":11}},{"id":"3b720da5-4cff-4dd8-89ad-6de1d84ca7c8","block_type":"box","text":"other similar instruments traded in the interbank market. A Fund may be limited in its ability to enter into cer tain","page_number":50,"box":{"x":69,"y":551,"width":801,"height":11}},{"id":"9fba6d7c-a166-48c1-9383-b5c1409aafff","block_type":"box","text":"interest rate derivatives due to applicable income tax requirements.","page_number":50,"box":{"x":70,"y":566,"width":480,"height":11}},{"id":"d913da44-4520-4cb1-95b8-722ab4c467ff","block_type":"box","text":"Interest rate swaps are transactions in which each par ty makes periodic interest payments based on a fixed or","page_number":50,"box":{"x":102,"y":589,"width":790,"height":11}},{"id":"f34c70ef-a97e-4ae5-a580-b2b89302bf71","block_type":"box","text":"variable interest rate, index or asset in return for periodic payments from its counterpar ty based on a different fixed","page_number":50,"box":{"x":68,"y":604,"width":825,"height":11}},{"id":"562f1b1a-a304-48c4-b450-97166da81f30","block_type":"box","text":"or variable interest rate, index or asset.","page_number":50,"box":{"x":69,"y":619,"width":280,"height":11}},{"id":"fa50a487-ea6a-4b32-8277-5621b9fb0b4b","block_type":"box","text":"The purchase of an interest rate floor entitles the purchaser, to the extent that a specified index falls below a","page_number":50,"box":{"x":101,"y":642,"width":780,"height":11}},{"id":"d69a2bd8-6e16-4857-9c5a-a178088c7499","block_type":"box","text":"predetermined interest rate, to receive payments of interest on a notional principal amount from the par ty selling","page_number":50,"box":{"x":70,"y":657,"width":805,"height":11}},{"id":"25bcdb27-fffe-4876-8737-954740c946d1","block_type":"box","text":"such interest rate floor.","page_number":50,"box":{"x":69,"y":672,"width":165,"height":9}},{"id":"b8cd10c1-f58e-46f0-9c0d-8982278334d1","block_type":"box","text":"The purchase of an interest rate cap entitles the purchaser, to the extent that a specified index rises above a","page_number":50,"box":{"x":101,"y":695,"width":780,"height":11}},{"id":"c61c5b49-37aa-4282-82a9-e05615403a35","block_type":"box","text":"predetermined interest rate, to receive payments of interest on a notional principal amount from the par ty selling","page_number":50,"box":{"x":70,"y":710,"width":805,"height":11}},{"id":"b00a4b3d-c5d3-48b8-9ef1-ec572d57613a","block_type":"box","text":"such interest rate cap.","page_number":50,"box":{"x":69,"y":725,"width":159,"height":11}},{"id":"b9af3570-8d1c-49a9-b9ba-ae7c93a9ee99","block_type":"box","text":"A Fund may enter into an interest rate swap to effectively exchange with another par ty their respective","page_number":50,"box":{"x":101,"y":748,"width":729,"height":11}},{"id":"ef949b1b-df76-4f87-ac40-502dbb1f5eae","block_type":"box","text":"commitments to pay or receive interest,","page_number":50,"box":{"x":69,"y":763,"width":282,"height":11}},{"id":"ebd374f9-9df6-4d59-9bfc-5ca1f1b2c067","block_type":"box","text":"e.g.","page_number":50,"box":{"x":359,"y":764,"width":24,"height":10}},{"id":"426db6c9-db30-459f-ba06-23d6dc822cc1","block_type":"box","text":", an exchange of fixed rate payments for floating rate payments. For","page_number":50,"box":{"x":386,"y":763,"width":482,"height":11}},{"id":"4cf007bc-e184-41eb-b6d8-162d5ebef48a","block_type":"box","text":"example, if a Fund holds a mor tgage-backed security with an interest rate that is reset only once each year, it may","page_number":50,"box":{"x":69,"y":778,"width":814,"height":11}},{"id":"c5f1e5b7-4872-472b-8ed9-0fcf2a4fa3aa","block_type":"box","text":"swap the right to receive interest at this fixed rate for the right to receive interest at a rate that is reset every week.","page_number":50,"box":{"x":69,"y":793,"width":823,"height":11}},{"id":"fc51a264-e9d5-4c34-b57b-b8a7f78ffe08","block_type":"box","text":"This would enable a Fund to offset a decline in the value of the mor tgage-backed security due to rising interest rates","page_number":50,"box":{"x":68,"y":808,"width":832,"height":11}},{"id":"f2176517-e73f-40f0-a051-506e02ac4fa3","block_type":"box","text":"but would also limit its ability to benefit from falling interest rates. Conversely, if a Fund holds a mor tgage-backed","page_number":50,"box":{"x":69,"y":823,"width":807,"height":12}},{"id":"1448ba9e-d5eb-4760-a87f-069e2221b67c","block_type":"box","text":"security with an interest rate that is reset every week and it would like to lock in what it believes to be a high interest","page_number":50,"box":{"x":69,"y":839,"width":836,"height":11}},{"id":"4f6b97f7-a1a0-42aa-8721-7ff66ab9ec06","block_type":"box","text":"rate for one year, it may swap the right to receive interest at this variable weekly rate for the right to receive interest","page_number":50,"box":{"x":69,"y":853,"width":826,"height":12}},{"id":"c5a17cf1-536e-42b5-ba32-f1c5b85b2357","block_type":"box","text":"at a rate that is fixed for one year. Such a swap would protect the Fund from a reduction in yield due to falling interest","page_number":50,"box":{"x":69,"y":869,"width":840,"height":11}},{"id":"5523e379-b747-4228-8187-c16d3187da85","block_type":"box","text":"rates and may permit the Fund to enhance its income through the positive differential between one week and one","page_number":50,"box":{"x":69,"y":884,"width":810,"height":11}},{"id":"45bdb4ef-807b-46c8-862a-f77cf396d1fb","block_type":"box","text":"year interest rates, but would preclude it from taking full advantage of rising interest rates.","page_number":50,"box":{"x":68,"y":899,"width":646,"height":11}},{"id":"7852c6d7-3612-473c-b6e7-f4f5632b0ba9","block_type":"box","text":"II-19","page_number":50,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"c0805902-dcfa-4dad-9e0a-04705c0aafcf","block_type":"box","text":"NM1026U-5982568-50/232","page_number":50,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"460f9552-8c9b-455d-af29-c439f48b6f25","block_type":"box","text":"Gains from transactions in interest rate swaps distributed to shareholders will be taxable as ordinary income or,","page_number":51,"box":{"x":102,"y":45,"width":798,"height":11}},{"id":"83d56c86-2b9b-47af-b9dd-56d90a1d8cf9","block_type":"box","text":"in cer tain circumstances, as long term capital gains to shareholders.","page_number":51,"box":{"x":70,"y":60,"width":490,"height":11}},{"id":"e1f26743-170f-4ec6-93c7-57ad6624114b","block_type":"box","text":"Interest rate swaps and interest rate caps and floors may be subject to correlation risk, leverage risk, illiquidity","page_number":51,"box":{"x":102,"y":82,"width":791,"height":12}},{"id":"8659a5fa-115a-4dde-a5b9-9881f24c91b5","block_type":"box","text":"risk and market risk. See “—Risk Factors in Derivatives” above.","page_number":51,"box":{"x":69,"y":98,"width":454,"height":9}},{"id":"3ab428d5-78f5-417b-b1de-e5997c20d091","block_type":"box","text":"Total Return Swaps.","page_number":51,"box":{"x":103,"y":120,"width":139,"height":11}},{"id":"7b4b3323-7e61-49e0-8539-92ca7efdec2b","block_type":"box","text":"Total return swaps are contracts in which one par ty agrees to make periodic payments to","page_number":51,"box":{"x":249,"y":120,"width":634,"height":12}},{"id":"d6693e56-4760-4f26-afb6-57d9f8b54e1e","block_type":"box","text":"the other par ty based on the return of the assets underlying the contract in exchange for periodic payments based on","page_number":51,"box":{"x":68,"y":135,"width":838,"height":12}},{"id":"b378e028-5317-4b11-917f-abe47a3dc922","block_type":"box","text":"a fixed or variable interest rate or the total return from different underlying assets. The return of the assets","page_number":51,"box":{"x":69,"y":150,"width":764,"height":12}},{"id":"e2460f6b-ff1e-4ace-baa5-a5e195b87ee3","block_type":"box","text":"underlying the contract includes both the income generated by the asset and the change in market value of the","page_number":51,"box":{"x":69,"y":166,"width":791,"height":11}},{"id":"6691a063-7959-4bf1-acfa-5198b113282c","block_type":"box","text":"asset. The asset underlying the contract may include a specified security, basket of securities or securities indices.","page_number":51,"box":{"x":69,"y":181,"width":821,"height":11}},{"id":"26cd15c3-16e4-4369-96d2-4e59cadb2c52","block_type":"box","text":"Total return swaps on a specified security, basket of securities or securities indices may sometimes be referred to as","page_number":51,"box":{"x":68,"y":196,"width":838,"height":11}},{"id":"5108d0c1-8b81-4383-a8f5-73e71d10c791","block_type":"box","text":"“contracts for difference.”","page_number":51,"box":{"x":70,"y":211,"width":184,"height":9}},{"id":"4d42a552-d60d-434d-8407-9666382fe335","block_type":"box","text":"Total return swaps may be used to obtain exposure to a security or market without owning or taking physical","page_number":51,"box":{"x":101,"y":234,"width":770,"height":11}},{"id":"733f101b-e0bf-44bc-a751-62b5f2ae8780","block_type":"box","text":"custody of such security or investing directly in such market. Upon entering into a total return swap, a Fund is","page_number":51,"box":{"x":69,"y":249,"width":780,"height":11}},{"id":"f2cdcb16-bbd4-4eb0-9ad1-d0c4c819e6f6","block_type":"box","text":"required to deposit initial margin but the par ties do not exchange the notional amount. As a result, total return swaps","page_number":51,"box":{"x":69,"y":264,"width":839,"height":11}},{"id":"9332376f-b600-464c-b5ea-36feb22b12b2","block_type":"box","text":"may effectively add leverage to the Fund’s por tfolio because the Fund would be subject to investment exposure on","page_number":51,"box":{"x":69,"y":279,"width":816,"height":11}},{"id":"1b7d5279-4026-41c4-8387-f3af618457a5","block_type":"box","text":"the notional amount of the swap.","page_number":51,"box":{"x":68,"y":294,"width":235,"height":11}},{"id":"71c762cc-f348-4df8-93cd-e296b2f02362","block_type":"box","text":"Total return swaps are subject to significant correlation risk, leverage risk, illiquidity risk, market risk and","page_number":51,"box":{"x":101,"y":317,"width":746,"height":11}},{"id":"b1c71fd4-3fc0-45a4-ab8b-3f96417ca41d","block_type":"box","text":"counterpar ty risk. See “—Risk Factors in Derivatives” above.","page_number":51,"box":{"x":69,"y":332,"width":433,"height":11}},{"id":"2db5200a-72a2-4e85-88f6-4dc3ecefe649","block_type":"box","text":"Options.","page_number":51,"box":{"x":102,"y":355,"width":57,"height":11}},{"id":"5749f170-4475-4efd-b5f3-08fc60a33578","block_type":"box","text":"Options on Securities and Securities Indices.","page_number":51,"box":{"x":102,"y":377,"width":319,"height":11}},{"id":"4365c296-74c3-4335-a5c5-0a17c95fe75b","block_type":"box","text":"A Fund may engage in transactions in options on individual","page_number":51,"box":{"x":427,"y":377,"width":418,"height":12}},{"id":"46e11c67-5751-4e16-8dc0-a21224f19426","block_type":"box","text":"securities, baskets of securities or securities indices, or par ticular measurements of value or rates, such as an index","page_number":51,"box":{"x":69,"y":392,"width":838,"height":11}},{"id":"eae7b1e7-1f14-4ad6-9d92-dd1dc848d936","block_type":"box","text":"of the price of treasury securities or an index representative of shor t-term interest rates. Such investments may be","page_number":51,"box":{"x":69,"y":407,"width":820,"height":12}},{"id":"d21a97b4-ae2e-4bf2-9491-285c20856439","block_type":"box","text":"made on exchanges and in the OTC markets. In general, exchange-traded options have standardized exercise prices","page_number":51,"box":{"x":69,"y":423,"width":826,"height":11}},{"id":"1339efa5-b3f7-4436-a7ec-bdc4921a327d","block_type":"box","text":"and expiration dates and require the par ties to post margin against their obligations, and the per formance of the","page_number":51,"box":{"x":69,"y":438,"width":806,"height":11}},{"id":"ac364004-c6ed-4a2d-9690-faec1825a2b5","block_type":"box","text":"par ties’ obligations in connection with such options is guaranteed by the exchange or a related clearing corporation.","page_number":51,"box":{"x":70,"y":453,"width":825,"height":11}},{"id":"993a7ac6-e549-48fe-a174-7805e53a5b44","block_type":"box","text":"OTC options have more flexible terms negotiated between the buyer and the seller, but are subject to greater credit","page_number":51,"box":{"x":69,"y":468,"width":822,"height":11}},{"id":"4c1a7beb-e20e-4f15-b4ae-cbfb92aa1e7b","block_type":"box","text":"risk. OTC options also involve greater illiquidity risk.","page_number":51,"box":{"x":69,"y":483,"width":366,"height":11}},{"id":"e102108c-1c14-45ce-9e3c-d9e7be5ce4da","block_type":"box","text":"A Fund may also engage in transactions in options which have additional features that result in different","page_number":51,"box":{"x":101,"y":506,"width":743,"height":11}},{"id":"06887c56-5f24-486e-bfb7-a32e76926ff1","block_type":"box","text":"payment structures and/or expirations (commonly referred to as exotic options). For example, barrier options are","page_number":51,"box":{"x":70,"y":521,"width":804,"height":11}},{"id":"f9fcb0d8-2f38-40eb-ba7e-6c64de396d22","block_type":"box","text":"exotic options that can only be exercised (or automatically expire) if the price of the underlying asset reaches one or","page_number":51,"box":{"x":69,"y":536,"width":827,"height":11}},{"id":"dbb701c2-493c-4208-89c0-fb41c6292980","block_type":"box","text":"more predetermined levels on or before expiration. Binary options are another example of exotic options which have","page_number":51,"box":{"x":69,"y":551,"width":827,"height":11}},{"id":"aee33763-67f3-4455-9872-0176a89d9881","block_type":"box","text":"a fixed all-or-nothing payout if one or more predetermined conditions are met. Exotic options are typically traded in","page_number":51,"box":{"x":69,"y":566,"width":812,"height":11}},{"id":"65ce6734-ce9a-442b-a7e6-a698190b2017","block_type":"box","text":"OTC markets.","page_number":51,"box":{"x":69,"y":581,"width":95,"height":9}},{"id":"c63e7c14-c34f-47c3-a744-57abaab0eb3a","block_type":"box","text":"There are several risks associated with transactions in options on securities and indexes. For example, there are","page_number":51,"box":{"x":101,"y":604,"width":806,"height":11}},{"id":"a13cfced-0381-4afd-83f1-c915e5da8542","block_type":"box","text":"significant differences between the securities and options markets that could result in an imper fect correlation","page_number":51,"box":{"x":69,"y":619,"width":791,"height":11}},{"id":"829984f1-907b-4fc8-aaf1-a3c0c3061d14","block_type":"box","text":"between these markets, causing a given transaction not to achieve its objectives. In addition, a liquid market for","page_number":51,"box":{"x":69,"y":634,"width":801,"height":12}},{"id":"4ea38be5-2009-4bf6-b786-cd9932540ef3","block_type":"box","text":"par ticular options, whether traded OTC or on a national securities exchange (“Exchange”) may be absent for reasons","page_number":51,"box":{"x":70,"y":649,"width":831,"height":12}},{"id":"170fbddf-8fc2-41c2-811d-459a919eaf4a","block_type":"box","text":"which include the following: there may be insufficient trading interest in cer tain options; restrictions may be imposed","page_number":51,"box":{"x":68,"y":664,"width":833,"height":12}},{"id":"23ba5975-cb36-4b59-89fd-2f51de153513","block_type":"box","text":"by an Exchange on opening transactions or closing transactions or both; trading halts, suspensions or other","page_number":51,"box":{"x":69,"y":680,"width":769,"height":11}},{"id":"a8631c12-cf6f-492c-a217-f418488200ad","block_type":"box","text":"restrictions may be imposed with respect to par ticular classes or series of options or underlying securities; unusual","page_number":51,"box":{"x":69,"y":695,"width":824,"height":11}},{"id":"2667d166-d240-46e7-aca2-c42f5f4b290d","block_type":"box","text":"or unforeseen circumstances may interrupt normal operations on an Exchange; the facilities of an Exchange or the","page_number":51,"box":{"x":69,"y":710,"width":816,"height":11}},{"id":"34f99105-924a-4683-8aea-88fae53ee7cd","block_type":"box","text":"Options Clearing Corporation may not at all times be adequate to handle current trading volume; or one or more","page_number":51,"box":{"x":69,"y":725,"width":796,"height":11}},{"id":"410e69b6-3b3d-400b-815d-d0b52352d761","block_type":"box","text":"Exchanges could, for economic or other reasons, decide or be compelled at some future date to discontinue the","page_number":51,"box":{"x":70,"y":740,"width":798,"height":11}},{"id":"5b0d3be1-ed06-41f3-8dbc-d1b8afcc252b","block_type":"box","text":"trading of options (or a par ticular class or series of options), in which event the market on that Exchange (or in that","page_number":51,"box":{"x":68,"y":755,"width":822,"height":11}},{"id":"027846ec-a8ac-4f35-b5be-d1ce7b69ff0e","block_type":"box","text":"class or series of options) would cease to exist, although outstanding options that had been issued by the Options","page_number":51,"box":{"x":69,"y":770,"width":818,"height":12}},{"id":"f80dfdbd-c3eb-42f6-9fa6-fa0a4a91a312","block_type":"box","text":"Clearing Corporation as a result of trades on that Exchange would continue to be exercisable in accordance with their","page_number":51,"box":{"x":69,"y":785,"width":836,"height":12}},{"id":"30e6ab24-4d24-43c9-85b4-0cad145b00ea","block_type":"box","text":"terms.","page_number":51,"box":{"x":68,"y":801,"width":45,"height":9}},{"id":"76227739-1a37-4de6-b44d-69ec993f9229","block_type":"box","text":"Each of the options exchanges has established limitations governing the maximum number of call or put options","page_number":51,"box":{"x":102,"y":823,"width":801,"height":12}},{"id":"426999ca-d5b8-46b8-94b1-5b94e50821a3","block_type":"box","text":"on the same asset that may be bought or written by a single investor, whether acting alone or in concer t with others","page_number":51,"box":{"x":69,"y":839,"width":826,"height":11}},{"id":"95482758-a6cc-4329-8429-23a78ffe7692","block_type":"box","text":"(regardless of whether such options are written on the same or different exchanges or are held or written on one or","page_number":51,"box":{"x":69,"y":853,"width":823,"height":12}},{"id":"39fd37bb-a755-4024-b4ab-b7bea572e5e5","block_type":"box","text":"more accounts or through one or more brokers). Under these limitations, option positions of all investment","page_number":51,"box":{"x":69,"y":869,"width":762,"height":11}},{"id":"85157469-0bac-4126-9d32-bec77db4d44a","block_type":"box","text":"companies advised by the Manager are combined for purposes of these limits. Pursuant to these limitations, an","page_number":51,"box":{"x":69,"y":884,"width":798,"height":11}},{"id":"1c9ddf75-7dfb-4bf1-81d3-de8415664b2b","block_type":"box","text":"II-20","page_number":51,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"92054060-bcc2-4cd6-a7ee-94d0a0244db1","block_type":"box","text":"NM1026U-5982568-51/232","page_number":51,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"4a3be9b4-2d14-46a0-97ce-7af25a3bf122","block_type":"box","text":"exchange may order the liquidation of positions and may impose other sanctions or restrictions. These position limits","page_number":52,"box":{"x":69,"y":45,"width":837,"height":11}},{"id":"e52b704e-3d4e-4550-8d04-878bc8116749","block_type":"box","text":"may restrict the number of listed options that a Fund may buy or sell.","page_number":52,"box":{"x":69,"y":60,"width":491,"height":11}},{"id":"e9051974-4e1b-49e5-8008-7b6eb8b2ad41","block_type":"box","text":"Call Options.","page_number":52,"box":{"x":102,"y":83,"width":89,"height":10}},{"id":"ef2d843c-145f-4eb8-9909-72c03da66be5","block_type":"box","text":"A Fund may purchase call options on any of the types of securities or instruments in which it may","page_number":52,"box":{"x":197,"y":82,"width":694,"height":12}},{"id":"8cf8101c-33bc-41f7-9bee-f391cb127111","block_type":"box","text":"invest. A purchased call option gives a Fund the right to buy, and obligates the seller to sell, the underlying security at","page_number":52,"box":{"x":70,"y":98,"width":838,"height":11}},{"id":"06a1f885-08da-4edc-a7b9-17f6a6702de9","block_type":"box","text":"the exercise price at any time during the option period. A Fund also may purchase and sell call options on indices.","page_number":52,"box":{"x":68,"y":113,"width":813,"height":11}},{"id":"b53d9fdb-401b-4f65-b63d-32c1f3f10800","block_type":"box","text":"Index options are similar to options on securities except that, rather than taking or making delivery of securities","page_number":52,"box":{"x":70,"y":128,"width":795,"height":11}},{"id":"3ca1b0a3-d627-4b7e-a48b-1aa40e1a3d42","block_type":"box","text":"underlying the option at a specified price upon exercise, an index option gives the holder the right to receive cash","page_number":52,"box":{"x":69,"y":143,"width":807,"height":11}},{"id":"6b678334-f2f6-4635-b7e5-80e121a41923","block_type":"box","text":"upon exercise of the option if the level of the index upon which the option is based is greater than the exercise price","page_number":52,"box":{"x":69,"y":158,"width":830,"height":11}},{"id":"05b833ab-0277-44d9-b413-ca4522509bb0","block_type":"box","text":"of the option.","page_number":52,"box":{"x":69,"y":173,"width":93,"height":11}},{"id":"4b3508a1-37a7-4915-9519-b542758c4f13","block_type":"box","text":"A written call option is covered if a Fund holds a call on the same security or index as the call written where the","page_number":52,"box":{"x":101,"y":196,"width":794,"height":11}},{"id":"74f8fb0c-bc2e-4c31-87d4-e0f1f10c0ff3","block_type":"box","text":"exercise price of the call held is (i) equal to or less than the exercise price of the call written, or (ii) greater than the","page_number":52,"box":{"x":69,"y":211,"width":823,"height":11}},{"id":"f90d60d4-3743-4ee0-9ca0-e68097117669","block_type":"box","text":"exercise price of the call written provided the difference is maintained by the Fund in assets which are not considered","page_number":52,"box":{"x":69,"y":226,"width":839,"height":11}},{"id":"3b77bcaf-43a2-4465-8d09-425c4a4d813e","block_type":"box","text":"illiquid investments under the Funds’ Liquidity Program (as defined below) (“liquid assets”) designated on the","page_number":52,"box":{"x":70,"y":241,"width":778,"height":11}},{"id":"32fd4c0a-fc77-44ff-a04c-ecd0e3b103cb","block_type":"box","text":"Manager’s or the sub-adviser’s books and records to the extent required by Commission guidelines.","page_number":52,"box":{"x":70,"y":256,"width":711,"height":12}},{"id":"94c197a0-0711-4cde-93bc-028dc395808d","block_type":"box","text":"A Fund may write (","page_number":52,"box":{"x":101,"y":279,"width":130,"height":11}},{"id":"ee7bdd8b-e082-40c9-9413-e550c3e6969d","block_type":"box","text":"i.e.","page_number":52,"box":{"x":233,"y":279,"width":20,"height":9}},{"id":"ced4bb04-50c9-4305-b2d5-1bfcf4b76f51","block_type":"box","text":", sell) covered call options on the securities or instruments in which it may invest and to","page_number":52,"box":{"x":256,"y":279,"width":627,"height":11}},{"id":"6f0f642c-5c89-4cb7-8a7a-cc1ce586f5ad","block_type":"box","text":"enter into closing purchase transactions with respect to cer tain of such options. A covered call option is an option in","page_number":52,"box":{"x":69,"y":294,"width":831,"height":11}},{"id":"ff85be54-6ad3-41d6-b011-fe4e12d6620c","block_type":"box","text":"which a Fund, in return for a premium, gives another par ty a right to buy specified securities owned by the Fund at a","page_number":52,"box":{"x":68,"y":309,"width":827,"height":11}},{"id":"9ef5f086-01af-491b-8d7a-140223b04704","block_type":"box","text":"specified future date and price set at the time of the contract. The principal reason for writing call options is the","page_number":52,"box":{"x":69,"y":324,"width":797,"height":12}},{"id":"fe43e62a-bbe6-4e79-9c11-23ad805538a1","block_type":"box","text":"attempt to realize, through the receipt of premiums, a greater return than would be realized on the securities alone.","page_number":52,"box":{"x":69,"y":339,"width":823,"height":12}},{"id":"13baeee7-d4b4-4568-954e-e137fc2a4f49","block_type":"box","text":"By writing covered call options, a Fund gives up the oppor tunity, while the option is in effect, to profit from any price","page_number":52,"box":{"x":70,"y":355,"width":823,"height":11}},{"id":"468f3c01-3148-4979-85ac-0b6fcb4ecc39","block_type":"box","text":"increase in the underlying security above the option exercise price. In addition, a Fund’s ability to sell the underlying","page_number":52,"box":{"x":70,"y":370,"width":825,"height":11}},{"id":"c899807c-2673-485e-b6fd-99b74ac18ec3","block_type":"box","text":"security will be limited while the option is in effect unless the Fund enters into a closing purchase transaction. A","page_number":52,"box":{"x":69,"y":385,"width":800,"height":11}},{"id":"b43880ed-1274-4ce1-bd13-4cc66f740497","block_type":"box","text":"closing purchase transaction cancels out a Fund’s position as the writer of an option by means of an offsetting","page_number":52,"box":{"x":69,"y":400,"width":792,"height":11}},{"id":"0dc94ac2-57f6-4014-9811-219fb0fba005","block_type":"box","text":"purchase of an identical option prior to the expiration of the option it has written. Covered call options also serve as","page_number":52,"box":{"x":70,"y":415,"width":826,"height":11}},{"id":"cab633df-27a4-4cc0-9ec5-6faffa66a34b","block_type":"box","text":"a par tial hedge to the extent of the premium received against the price of the underlying security declining.","page_number":52,"box":{"x":69,"y":430,"width":760,"height":11}},{"id":"6e33297b-d303-468f-9f90-236365b15635","block_type":"box","text":"A Fund may write","page_number":52,"box":{"x":101,"y":453,"width":120,"height":11}},{"id":"dfb70b0c-36bd-41ec-bf49-08476a3feb41","block_type":"box","text":"(i.e.","page_number":52,"box":{"x":228,"y":453,"width":25,"height":11}},{"id":"ce4725a6-c2ea-4b1d-a946-8fe26b7dee85","block_type":"box","text":", sell) uncovered call options on securities or instruments in which it may invest but that","page_number":52,"box":{"x":256,"y":453,"width":628,"height":11}},{"id":"d9995b8a-3632-4ea7-ba6b-1360ad228a1b","block_type":"box","text":"are not currently held by the Fund. The principal reason for writing uncovered call options is to realize income without","page_number":52,"box":{"x":69,"y":468,"width":834,"height":11}},{"id":"cf52a714-bcf1-4a14-8f21-689018fadb10","block_type":"box","text":"committing capital to the ownership of the underlying securities or instruments. When writing uncovered call options,","page_number":52,"box":{"x":69,"y":483,"width":830,"height":11}},{"id":"3726c3af-ade9-423a-bc0d-c7f78f1aa86a","block_type":"box","text":"a Fund must deposit and maintain sufficient margin with the broker-dealer through which it made the uncovered call","page_number":52,"box":{"x":69,"y":498,"width":825,"height":11}},{"id":"f7467a30-08c3-448f-b5cb-a2ff2c830603","block_type":"box","text":"option as collateral to ensure that the securities can be purchased for delivery if and when the option is exercised.","page_number":52,"box":{"x":69,"y":513,"width":818,"height":11}},{"id":"e72966b4-4b11-4254-8b98-c7f03d82c85d","block_type":"box","text":"During periods of declining securities prices or when prices are stable, writing uncovered calls can be a profitable","page_number":52,"box":{"x":70,"y":528,"width":806,"height":12}},{"id":"5c36b804-1716-4b8d-b6dd-74b8092ca936","block_type":"box","text":"strategy to increase a Fund’s income with minimal capital risk. Uncovered calls are riskier than covered calls because","page_number":52,"box":{"x":69,"y":544,"width":839,"height":11}},{"id":"09f791b7-6600-4cb5-9507-124ac1d3e6a7","block_type":"box","text":"there is no underlying security held by a Fund that can act as a par tial hedge. Uncovered calls have speculative","page_number":52,"box":{"x":68,"y":559,"width":793,"height":11}},{"id":"35871249-6653-418d-bee4-7b5ffcd46f8f","block_type":"box","text":"characteristics and the potential for loss is unlimited. When an uncovered call is exercised, a Fund must purchase","page_number":52,"box":{"x":69,"y":574,"width":814,"height":11}},{"id":"e626dc2b-da03-40a0-af7f-4c73ddd24eea","block_type":"box","text":"the underlying security to meet its call obligation. There is also a risk, especially with preferred and debt securities","page_number":52,"box":{"x":68,"y":589,"width":818,"height":11}},{"id":"283dc147-5707-4603-9530-457dd5113ee0","block_type":"box","text":"that lack sufficient liquidity, that the securities may not be available for purchase. If the purchase price exceeds the","page_number":52,"box":{"x":68,"y":604,"width":825,"height":11}},{"id":"1c1a19c7-cdeb-48aa-b377-8ddfc0c6e47b","block_type":"box","text":"exercise price, a Fund will lose the difference.","page_number":52,"box":{"x":69,"y":619,"width":326,"height":11}},{"id":"8af7f386-1498-4e92-87a8-7fd838dba7a2","block_type":"box","text":"Put Options.","page_number":52,"box":{"x":102,"y":642,"width":85,"height":11}},{"id":"3a559bce-8405-4f75-a296-f33872849f16","block_type":"box","text":"A Fund may purchase put options to seek to hedge against a decline in the value of its securities or","page_number":52,"box":{"x":194,"y":642,"width":712,"height":11}},{"id":"f84b560f-e5f9-478f-be2f-38f29be463a8","block_type":"box","text":"to enhance its return. By buying a put option, a Fund acquires a right to sell the underlying securities or instruments","page_number":52,"box":{"x":68,"y":657,"width":828,"height":11}},{"id":"6064e234-9213-4870-be83-e3f3fd2028b9","block_type":"box","text":"at the exercise price, thus limiting the Fund’s risk of loss through a decline in the market value of the securities or","page_number":52,"box":{"x":69,"y":672,"width":816,"height":11}},{"id":"3030df23-39c0-4681-ba72-3f5fa9826feb","block_type":"box","text":"instruments until the put option expires. The amount of any appreciation in the value of the underlying securities or","page_number":52,"box":{"x":70,"y":687,"width":820,"height":11}},{"id":"79928917-14ae-4051-8820-50ee438f8d69","block_type":"box","text":"instruments will be par tially offset by the amount of the premium paid for the put option and any related transaction","page_number":52,"box":{"x":70,"y":702,"width":826,"height":11}},{"id":"f471f3fd-586f-4bf0-b4c8-ed882d7efad9","block_type":"box","text":"costs. Prior to its expiration, a put option may be sold in a closing sale transaction and profit or loss from the sale","page_number":52,"box":{"x":69,"y":717,"width":815,"height":12}},{"id":"1c66fc61-9c28-4b80-b34f-42df7f63a7f7","block_type":"box","text":"will depend on whether the amount received is more or less than the premium paid for the put option plus the related","page_number":52,"box":{"x":68,"y":732,"width":839,"height":11}},{"id":"c9c8845d-a5ef-49dc-8097-44e21f590e38","block_type":"box","text":"transaction costs. A closing sale transaction cancels out a Fund’s position as the purchaser of an option by means of","page_number":52,"box":{"x":68,"y":748,"width":841,"height":11}},{"id":"ad40b6d6-eb4d-468c-8b99-fd17876c111e","block_type":"box","text":"an offsetting sale of an identical option prior to the expiration of the option it has purchased. A Fund also may","page_number":52,"box":{"x":69,"y":763,"width":785,"height":11}},{"id":"c1e344f8-6cb3-490d-b04d-d3db9186f68d","block_type":"box","text":"purchase uncovered put options.","page_number":52,"box":{"x":70,"y":778,"width":231,"height":11}},{"id":"494f73ad-d5c7-4e50-b27f-76983519b669","block_type":"box","text":"A Fund also may write (","page_number":52,"box":{"x":101,"y":801,"width":165,"height":11}},{"id":"db4e90d7-f752-47aa-b45b-0636168822e1","block_type":"box","text":"i.e.","page_number":52,"box":{"x":268,"y":801,"width":20,"height":9}},{"id":"907a8ea4-db9a-4ea0-a2c1-4118ec6d49f7","block_type":"box","text":", sell) put options on the types of securities or instruments that may be held by the","page_number":52,"box":{"x":291,"y":801,"width":591,"height":11}},{"id":"73e7f187-637c-42d8-859d-f1bc1cc02768","block_type":"box","text":"Fund. A Fund will receive a premium for writing a put option, which increases the Fund’s return.","page_number":52,"box":{"x":70,"y":816,"width":675,"height":11}},{"id":"1d0fb302-46bf-484f-84b8-2ee0d28dd87e","block_type":"box","text":"A Fund also may write (","page_number":52,"box":{"x":101,"y":839,"width":165,"height":10}},{"id":"53ee0c6c-94ee-4985-9a8b-c6fbc654fc3e","block_type":"box","text":"i.e.","page_number":52,"box":{"x":268,"y":839,"width":20,"height":8}},{"id":"dd5fb1d4-d552-4723-bdda-b4547208cea6","block_type":"box","text":", sell) uncovered put options on securities or instruments in which it may invest but","page_number":52,"box":{"x":291,"y":839,"width":593,"height":10}},{"id":"eaa60001-91aa-4c58-9bf9-50c5835a51ec","block_type":"box","text":"with respect to which the Fund does not currently have a corresponding shor t position or has not deposited as","page_number":52,"box":{"x":68,"y":854,"width":789,"height":11}},{"id":"fdccc13e-9624-4042-9ba3-1ab3bdcec9ac","block_type":"box","text":"collateral cash equal to the exercise value of the put option with the broker-dealer through which it made the","page_number":52,"box":{"x":69,"y":869,"width":773,"height":11}},{"id":"3b389f5b-5d6a-4dc0-8105-4ea0ab39aa20","block_type":"box","text":"uncovered put option. The principal reason for writing uncovered put options is to receive premium income and to","page_number":52,"box":{"x":69,"y":884,"width":807,"height":11}},{"id":"b978a526-a632-4937-bdb7-16f603f38867","block_type":"box","text":"acquire such securities or instruments at a net cost below the current market value. A Fund has the obligation to buy","page_number":52,"box":{"x":69,"y":899,"width":835,"height":11}},{"id":"6e48915a-6373-434d-80ea-13123b64674c","block_type":"box","text":"II-21","page_number":52,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"935c81fb-775b-48a2-afc2-eaa0315bc9f5","block_type":"box","text":"NM1026U-5982568-52/232","page_number":52,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"ff4bc39e-7579-47f8-b1c6-604685ee9d1e","block_type":"box","text":"the securities or instruments at an agreed upon price if the price of the securities or instruments decreases below","page_number":53,"box":{"x":68,"y":45,"width":818,"height":11}},{"id":"f06998cf-bc06-4e61-a0d1-cefc24a47ec1","block_type":"box","text":"the exercise price. If the price of the securities or instruments increases during the option period, the option will","page_number":53,"box":{"x":68,"y":60,"width":800,"height":11}},{"id":"3368b504-3c62-4352-a871-c300936027f4","block_type":"box","text":"expire wor thless and a Fund will retain the premium and will not have to purchase the securities or instruments at","page_number":53,"box":{"x":69,"y":75,"width":814,"height":11}},{"id":"f809ebbc-95f8-4083-af1d-15f151a0b46a","block_type":"box","text":"the exercise price.","page_number":53,"box":{"x":68,"y":90,"width":130,"height":11}},{"id":"be37c4e6-2857-4438-b5b1-b322e1f6dc1c","block_type":"box","text":"Options on Government National Mor tgage Association (“GNMA”) Cer tificates.","page_number":53,"box":{"x":102,"y":113,"width":556,"height":11}},{"id":"55bdb3a3-0a48-41b7-9ec5-4d831b5fb35a","block_type":"box","text":"The following information relates","page_number":53,"box":{"x":664,"y":113,"width":232,"height":11}},{"id":"d24d61dd-218d-4c57-8ffd-f636b0338a40","block_type":"box","text":"to the unique characteristics of options on GNMA Cer tificates. Since the remaining principal balance of GNMA","page_number":53,"box":{"x":68,"y":128,"width":784,"height":11}},{"id":"6972c5c3-f6bb-458a-8b38-98b3e9532909","block_type":"box","text":"Cer tificates declines each month as a result of mor tgage payments, a Fund, as a writer of a GNMA call holding GNMA","page_number":53,"box":{"x":69,"y":143,"width":840,"height":11}},{"id":"1b818eff-3c41-4666-9101-f77e7e54fd6b","block_type":"box","text":"Cer tificates as “cover” to satisfy its delivery obligation in the event of exercise, may find that the GNMA Cer tificates","page_number":53,"box":{"x":69,"y":158,"width":827,"height":11}},{"id":"18815edc-c33e-45f4-b412-d90db2dbe07e","block_type":"box","text":"it holds no longer have a sufficient remaining principal balance for this purpose. Should this occur, a Fund will","page_number":53,"box":{"x":70,"y":173,"width":781,"height":11}},{"id":"6b1500ff-6262-4be4-a7e2-f41d547919a1","block_type":"box","text":"purchase additional GNMA Cer tificates from the same pool (if obtainable) or other GNMA Cer tificates in the cash","page_number":53,"box":{"x":70,"y":188,"width":803,"height":11}},{"id":"9a1fc9fb-2d4a-4a7a-bf21-0746373f3a1f","block_type":"box","text":"market in order to maintain its “cover.”","page_number":53,"box":{"x":69,"y":204,"width":277,"height":8}},{"id":"25b15ddc-94ac-4d1e-a6c6-d922f4ef95f1","block_type":"box","text":"A GNMA Cer tificate held by a Fund to cover an option position in any but the nearest expiration month may cease","page_number":53,"box":{"x":101,"y":226,"width":807,"height":11}},{"id":"1824b422-97d8-421c-9240-e7532d1b198d","block_type":"box","text":"to represent cover for the option in the event of a decline in the GNMA coupon rate at which new pools are originated","page_number":53,"box":{"x":68,"y":241,"width":835,"height":11}},{"id":"7bc76085-21c8-4e60-b1d6-0270d30bf0dd","block_type":"box","text":"under the FHA/VA loan ceiling in effect at any given time. If this should occur, a Fund will no longer be covered, and","page_number":53,"box":{"x":69,"y":256,"width":821,"height":12}},{"id":"0f7d19ee-9603-4fcc-bb8a-67aa1e1d989b","block_type":"box","text":"the Fund will either enter into a closing purchase transaction or replace such Cer tificate with a cer tificate that","page_number":53,"box":{"x":68,"y":271,"width":784,"height":12}},{"id":"9acd04bb-33f2-474b-b575-69ef1a5a81e9","block_type":"box","text":"represents cover. When a Fund closes its position or replaces such Cer tificate, it may realize an unanticipated loss","page_number":53,"box":{"x":69,"y":286,"width":820,"height":12}},{"id":"5c7cac1f-d99e-4fa3-95d1-9bb54c39550b","block_type":"box","text":"and incur transaction costs.","page_number":53,"box":{"x":69,"y":302,"width":197,"height":9}},{"id":"5127b62b-8a5d-4318-8303-c212a0195cf8","block_type":"box","text":"Options on Swaps (“Swaptions”).","page_number":53,"box":{"x":102,"y":324,"width":235,"height":11}},{"id":"faf4fae6-5139-4a31-8c7c-a642599e7a10","block_type":"box","text":"A swaption gives a counterpar ty the option (but not the obligation) to enter into","page_number":53,"box":{"x":343,"y":325,"width":563,"height":11}},{"id":"06dab993-f224-4a96-bf51-b0e49e50c9e5","block_type":"box","text":"a new swap agreement or to shor ten, extend, cancel or otherwise modify an existing swap agreement, at a","page_number":53,"box":{"x":69,"y":339,"width":763,"height":12}},{"id":"9814ec71-d398-43ba-8d40-e9648cd10426","block_type":"box","text":"designated future time on specified terms. A Fund may write (","page_number":53,"box":{"x":69,"y":355,"width":439,"height":11}},{"id":"65eaaed4-23ed-4102-bf45-e84fd9481263","block_type":"box","text":"i.e.","page_number":53,"box":{"x":510,"y":355,"width":20,"height":9}},{"id":"06c4c9a0-2be1-47b5-a22a-be158e811588","block_type":"box","text":", sell) and purchase put and call swaptions.","page_number":53,"box":{"x":533,"y":355,"width":309,"height":11}},{"id":"e78ea2d2-2c71-419c-a714-c7d78b76bc9f","block_type":"box","text":"Depending on the terms of the par ticular option agreement, a Fund will generally incur a greater degree of risk when","page_number":53,"box":{"x":70,"y":370,"width":826,"height":11}},{"id":"82747295-7e12-4ae6-be2e-7420a26f5633","block_type":"box","text":"it writes a swaption than it will incur when it purchases a swaption. When a Fund purchases a swaption, it risks","page_number":53,"box":{"x":70,"y":385,"width":793,"height":11}},{"id":"eebe7a01-0003-456b-90aa-0a43666e0771","block_type":"box","text":"losing only the amount of the premium it has paid should it decide to let the option expire unexercised. However,","page_number":53,"box":{"x":70,"y":400,"width":802,"height":11}},{"id":"7fb6d7dc-c859-44c0-9d2c-6792683afdb8","block_type":"box","text":"when a Fund writes a swaption, upon exercise of the option the Fund will become obligated according to the terms of","page_number":53,"box":{"x":68,"y":415,"width":836,"height":11}},{"id":"04c0dc46-761f-4a5e-98c6-38e8149857cb","block_type":"box","text":"the underlying agreement and the potential for loss may be unlimited. Cer tain swaptions are permitted, although not","page_number":53,"box":{"x":68,"y":430,"width":832,"height":11}},{"id":"12d95025-4825-4640-a70d-532e91c772d7","block_type":"box","text":"required, to be cleared.","page_number":53,"box":{"x":69,"y":446,"width":165,"height":10}},{"id":"d17b3ee5-c6c9-4cf8-aa79-16de761209bb","block_type":"box","text":"A Fund will likely enter into these transactions to preserve a return or spread on a par ticular investment or","page_number":53,"box":{"x":101,"y":468,"width":760,"height":11}},{"id":"f2047088-0880-46c0-a54e-2f563252bc45","block_type":"box","text":"por tion of its por tfolio or to protect against any increase in the price of securities the Fund anticipates purchasing at","page_number":53,"box":{"x":70,"y":483,"width":830,"height":11}},{"id":"1757ce16-5404-4294-8d89-ce010f4fb501","block_type":"box","text":"a later date. A Fund generally will use these transactions for hedging purposes, not for speculation.","page_number":53,"box":{"x":69,"y":498,"width":706,"height":11}},{"id":"781db355-4a7c-4841-aa1a-8ad9d9df8fbe","block_type":"box","text":"Swaptions may be subject to correlation risk, leverage risk, illiquidity risk and market risk. See “—Risk Factors in","page_number":53,"box":{"x":102,"y":521,"width":805,"height":11}},{"id":"7b6a4c62-8c05-480d-a2c3-bf7ee6d10566","block_type":"box","text":"Derivatives” above.","page_number":53,"box":{"x":70,"y":536,"width":135,"height":9}},{"id":"615e7619-6b38-4bf4-85ea-1977c0cccf96","block_type":"box","text":"FLEX Options.","page_number":53,"box":{"x":102,"y":559,"width":96,"height":11}},{"id":"ae9e75e9-9c3c-4175-94f5-d13d97c1756b","block_type":"box","text":"FLEX Options are customized option contracts available through national securities exchanges that","page_number":53,"box":{"x":206,"y":559,"width":702,"height":11}},{"id":"4fb5d138-765a-478b-a529-45abdf3ca224","block_type":"box","text":"are guaranteed for settlement by the Options Clearing Corporation (“OCC”). FLEX Options are listed on a U.S. national","page_number":53,"box":{"x":69,"y":574,"width":839,"height":11}},{"id":"b78cd499-9f75-4f1d-8248-2761ac1a02f0","block_type":"box","text":"securities exchange. FLEX Options provide investors with the ability to customize assets referenced by the options,","page_number":53,"box":{"x":69,"y":589,"width":818,"height":11}},{"id":"649ee3e0-fac1-4647-a778-ed98e8571ccd","block_type":"box","text":"exercise prices, exercise styles (","page_number":53,"box":{"x":69,"y":604,"width":231,"height":11}},{"id":"fc58a113-13ed-49c4-b2de-a86f34c517c0","block_type":"box","text":"i.e.","page_number":53,"box":{"x":302,"y":604,"width":20,"height":9}},{"id":"11e6cf73-2456-4c55-892f-536bc6598d70","block_type":"box","text":", American-style, exercisable any time prior to the expiration date, or European","page_number":53,"box":{"x":325,"y":604,"width":561,"height":11}},{"id":"e582a7f2-68e4-4223-9464-e4d6ac455d56","block_type":"box","text":"style, exercisable only on the option expiration date) and expiration dates, while achieving price discovery in","page_number":53,"box":{"x":69,"y":619,"width":768,"height":11}},{"id":"452b4e6f-1aa8-40f2-830a-e1b4ed3d5187","block_type":"box","text":"competitive, transparent auctions markets and avoiding the counterpar ty exposure of OTC options positions. Each","page_number":53,"box":{"x":69,"y":634,"width":812,"height":12}},{"id":"45163e77-db07-4479-887a-3c6f95f3274f","block_type":"box","text":"option contract entitles the holder thereof to purchase (for the call options) or sell (for the put options) shares of the","page_number":53,"box":{"x":69,"y":649,"width":830,"height":11}},{"id":"3decdb25-8c2b-45c4-bcd2-eaf18657903c","block_type":"box","text":"reference asset at the strike price. A Fund’s por tfolio may include several types of FLEX Options, including both","page_number":53,"box":{"x":69,"y":664,"width":792,"height":12}},{"id":"74f54d83-7292-4cdb-b9f2-dfb76fb50676","block_type":"box","text":"purchased and written put and call options (as fur ther described below). The FLEX Options are all European style","page_number":53,"box":{"x":70,"y":680,"width":802,"height":11}},{"id":"f5be2e53-1c00-4ab8-9c79-72fa14704b00","block_type":"box","text":"options, which means that they are exercisable at a predetermined specified price (the “strike price”) only on the","page_number":53,"box":{"x":69,"y":695,"width":806,"height":11}},{"id":"45a0ca33-4260-41a7-a9b1-ad1cfc149356","block_type":"box","text":"FLEX Option’s expiration date.","page_number":53,"box":{"x":70,"y":710,"width":211,"height":11}},{"id":"2d9647b5-0175-4c25-9ef6-386e11a4f996","block_type":"box","text":"The OCC guarantees per formance by each of the counterpar ties to the FLEX Options, becoming the “buyer for","page_number":53,"box":{"x":101,"y":732,"width":783,"height":12}},{"id":"3a5768ad-74ca-4128-8310-f1a81088338e","block_type":"box","text":"every seller and the seller for every buyer”, reducing counterpar ty risk for clearing members and options traders.","page_number":53,"box":{"x":69,"y":748,"width":802,"height":11}},{"id":"132908f6-bf9e-49d7-afef-3b8a715dcb72","block_type":"box","text":"Although guaranteed for settlement by the OCC, FLEX Options are still subject to counterpar ty risk with the OCC and","page_number":53,"box":{"x":68,"y":763,"width":826,"height":11}},{"id":"a276946c-932b-4e51-ad6e-dffb7edf770c","block_type":"box","text":"subject to the risk that the OCC may fail to per form the settlement of the FLEX Options due to bankruptcy or other","page_number":53,"box":{"x":69,"y":778,"width":814,"height":11}},{"id":"bcc44efd-52fa-4730-86a6-8a7812486059","block_type":"box","text":"adverse reasons. A Fund bears the risk that the OCC will be unable or unwilling to per form its obligations under the","page_number":53,"box":{"x":69,"y":793,"width":822,"height":11}},{"id":"e57430c5-4d31-44bb-9469-d022fd65b71a","block_type":"box","text":"FLEX Options contracts.","page_number":53,"box":{"x":70,"y":808,"width":166,"height":11}},{"id":"31fb94f1-1122-427f-8c79-b147071f2c9a","block_type":"box","text":"Subject to determination by the Securities Committee of the OCC, adjustments may be made to the FLEX","page_number":53,"box":{"x":102,"y":831,"width":748,"height":11}},{"id":"3ae01e61-f288-4c9e-bd94-bdb13688e6f4","block_type":"box","text":"Options for cer tain events (collectively, “Corporate Actions”) specified in the OCC’s by-laws and rules: cer tain stock","page_number":53,"box":{"x":69,"y":846,"width":822,"height":11}},{"id":"e1022057-6024-4322-97ad-af31a45503c8","block_type":"box","text":"dividends or distributions, stock splits, reverse stock splits, rights offerings, distributions, reorganizations,","page_number":53,"box":{"x":69,"y":861,"width":759,"height":11}},{"id":"6d669d99-3794-494c-ba2b-149e14659bbf","block_type":"box","text":"recapitalizations, or reclassifications with respect to an underlying security, or a merger, consolidation, dissolution or","page_number":53,"box":{"x":69,"y":876,"width":833,"height":11}},{"id":"a1f471ca-5ece-46f8-a296-4b0fd69ad52d","block_type":"box","text":"liquidation of the issuer of the underlying security. According to the OCC’s by-laws, the nature and extent of any such","page_number":53,"box":{"x":70,"y":891,"width":829,"height":12}},{"id":"4e42ed6c-a19e-43d8-80c5-646dbbd477f2","block_type":"box","text":"adjustment is to be determined by the OCC’s Securities Committee, in light of the circumstances known to it at the","page_number":53,"box":{"x":69,"y":906,"width":821,"height":12}},{"id":"b4cf1717-6487-4f23-ad3b-1d252895966f","block_type":"box","text":"II-22","page_number":53,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"f6769c4e-749b-4ff4-a958-a791e5c9257b","block_type":"box","text":"NM1026U-5982568-53/232","page_number":53,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"8c4a0dd6-1476-4fb9-85b4-16e3dce80955","block_type":"box","text":"time such determination is made, based on its judgment as to what is appropriate for the protection of investors and","page_number":54,"box":{"x":68,"y":45,"width":835,"height":11}},{"id":"86f6ff46-8b68-4b37-b698-097b7e386d38","block_type":"box","text":"the public interest, taking into account such factors as fairness to holders and writers (or purchasers and sellers) of","page_number":54,"box":{"x":68,"y":60,"width":829,"height":11}},{"id":"c9ef3cca-26a6-4b5c-af7d-652eb2ed7d5a","block_type":"box","text":"the affected options, the maintenance of a fair and orderly market in the affected options, consistency of","page_number":54,"box":{"x":68,"y":75,"width":753,"height":11}},{"id":"e2db5d4b-3673-4fff-a124-390fefc10d77","block_type":"box","text":"interpretation and practice, efficiency of exercise settlement procedures, and the coordination with other clearing","page_number":54,"box":{"x":70,"y":90,"width":806,"height":11}},{"id":"e9f95398-6277-4b2c-b363-7685923f3fda","block_type":"box","text":"agencies of the clearance and settlement of transactions in the underlying interest.","page_number":54,"box":{"x":69,"y":105,"width":593,"height":11}},{"id":"3aec000c-98ca-4fb8-a36c-33bc5c82d4d7","block_type":"box","text":"Cer tain Considerations Regarding Options","page_number":54,"box":{"x":135,"y":128,"width":298,"height":11}},{"id":"5d58b7a9-ecca-445c-b62e-f99ae551b54e","block_type":"box","text":". The FLEX Options in which each Fund may invest will be options","page_number":54,"box":{"x":435,"y":128,"width":461,"height":11}},{"id":"9bde0219-fdaa-463c-b739-40ef5600e457","block_type":"box","text":"on an exchange-traded fund (“ETF”) or the S&P 500 Index (together with such ETF, a “Reference Asset”). As","page_number":54,"box":{"x":102,"y":143,"width":768,"height":11}},{"id":"4384673d-5589-43d5-ba3d-658343770582","block_type":"box","text":"such, the value of a Fund’s FLEX Options will fluctuate with changes in the value of the securities held by the","page_number":54,"box":{"x":102,"y":158,"width":775,"height":11}},{"id":"43bd0367-4f92-4d49-ac07-cfab39395c60","block_type":"box","text":"ETF, and thus the ETF’s share price. In addition to the value of the ETF, the value of an option, in general, will","page_number":54,"box":{"x":102,"y":173,"width":777,"height":11}},{"id":"c277940b-f282-460c-9888-b29b1c3cc455","block_type":"box","text":"reflect, among other things, the time remaining until expiration (the end of the Outcome Period), the relationship","page_number":54,"box":{"x":102,"y":188,"width":799,"height":12}},{"id":"bc59998a-df6d-4d68-8329-46eb71903103","block_type":"box","text":"of the exercise price to the market price of the Reference Asset, and general market conditions. Options that","page_number":54,"box":{"x":102,"y":203,"width":777,"height":12}},{"id":"30cdc145-5629-4c2d-bdfd-b10308e6f89d","block_type":"box","text":"expire unexercised have no value.","page_number":54,"box":{"x":101,"y":219,"width":240,"height":10}},{"id":"11c86195-aca9-4806-a4fc-bc432152a29b","block_type":"box","text":"The puts and calls on the Reference Asset entitle the purchaser of the option the right to purchase (for a","page_number":54,"box":{"x":134,"y":241,"width":747,"height":11}},{"id":"9c677d98-f94f-48d6-90f5-15ddb5729de4","block_type":"box","text":"call option) or sell (for a put option) the Reference Asset at a predetermined specified price (the “strike price”).","page_number":54,"box":{"x":101,"y":256,"width":792,"height":11}},{"id":"f7dd5c5a-d41a-44fc-ab5b-6ebb16feb9cf","block_type":"box","text":"When a Fund writes a call on the Reference Asset, it receives a premium and agrees that the purchaser of the","page_number":54,"box":{"x":101,"y":271,"width":786,"height":12}},{"id":"a38e56a2-a82c-48bd-b342-3144a468af79","block_type":"box","text":"call, upon exercise of the call, will receive from the Fund the delivery of a specified number of shares of the ETF","page_number":54,"box":{"x":101,"y":286,"width":798,"height":12}},{"id":"7d8c4bb1-79ee-4961-bd04-9745073021ac","block_type":"box","text":"in exchange for the strike price. When a Fund buys a call on the Reference Asset, it pays a premium and has the","page_number":54,"box":{"x":102,"y":302,"width":802,"height":11}},{"id":"63b3dda2-27ac-4bcd-b536-f3cf1c5a399a","block_type":"box","text":"same rights to such call as indicated above. When a Fund buys a put on the Reference Asset, it pays a premium","page_number":54,"box":{"x":102,"y":317,"width":800,"height":11}},{"id":"53379474-51b3-4153-925f-bafff8d52af3","block_type":"box","text":"and has the right to require the seller of the put, upon the Fund’s exercise of the put, to deliver the specified","page_number":54,"box":{"x":102,"y":332,"width":774,"height":11}},{"id":"16ae4f83-6b49-4027-b822-cc787bfa6223","block_type":"box","text":"number of shares of the ETF in exchange for the strike price. When a Fund writes a put on the Reference Asset,","page_number":54,"box":{"x":102,"y":347,"width":793,"height":11}},{"id":"38f5d7fa-cbf9-476e-ad96-310766c8c77a","block_type":"box","text":"it receives a premium and the purchaser of the put has the right to require the Fund to deliver the specified","page_number":54,"box":{"x":102,"y":362,"width":764,"height":11}},{"id":"39a65ffe-ed4e-4745-b9ae-32a09f519b88","block_type":"box","text":"number of shares of the ETF in exchange for the strike price.","page_number":54,"box":{"x":102,"y":377,"width":430,"height":12}},{"id":"875ea418-5e25-42b5-837d-022c3146a198","block_type":"box","text":"Although each Fund will generally utilize FLEX Options that are physically settled, a Fund may also utilize","page_number":54,"box":{"x":134,"y":400,"width":740,"height":11}},{"id":"a1fb1ee2-9950-4ae3-8908-59e6d6ae871c","block_type":"box","text":"FLEX Options that are cash-settled. Cash-settled options give the holder the right to receive an amount (or owe","page_number":54,"box":{"x":102,"y":415,"width":787,"height":11}},{"id":"64d10392-3ce3-425c-8447-82a23d6088c0","block_type":"box","text":"an amount) of cash upon the exercise of the option. Gain or loss depends on changes in the value of the ETF’s","page_number":54,"box":{"x":102,"y":430,"width":790,"height":11}},{"id":"bb47c9a1-6747-48f1-a262-896fb4ca6c12","block_type":"box","text":"share price relative to the strike price for a given option contract. The amount of cash is equal to the difference","page_number":54,"box":{"x":102,"y":445,"width":793,"height":12}},{"id":"0479eacc-582e-4a71-b9c3-002c94683cef","block_type":"box","text":"between the closing price of the ETF’s share price and the exercise price of the option contract times a specified","page_number":54,"box":{"x":102,"y":460,"width":802,"height":12}},{"id":"7c0b25f1-39de-47a2-92d0-7a3b84dce30c","block_type":"box","text":"multiple (“multiplier”), which determines the total value for each point of such difference.","page_number":54,"box":{"x":102,"y":475,"width":635,"height":12}},{"id":"5f25f61d-c290-4939-9558-b2bee91078bd","block_type":"box","text":"Risks of Options on the Reference Assets","page_number":54,"box":{"x":135,"y":498,"width":297,"height":11}},{"id":"056b8e33-3ad9-4da5-af40-0912697d99b8","block_type":"box","text":". If a Fund has purchased an option and exercises it before the","page_number":54,"box":{"x":433,"y":498,"width":448,"height":11}},{"id":"cb306348-2737-4771-8248-5b6fcf9404b6","block_type":"box","text":"closing value for that day is available, it runs the risk that the level of the Reference Asset may subsequently","page_number":54,"box":{"x":101,"y":513,"width":777,"height":12}},{"id":"daed7960-e003-49e1-837b-087c0ca54003","block_type":"box","text":"change. If such a change causes the exercised option to fall out of the money, the applicable Fund will be","page_number":54,"box":{"x":101,"y":528,"width":753,"height":12}},{"id":"7294cc69-fa5a-405b-9147-7143d5136fa3","block_type":"box","text":"required to pay the difference between the closing Reference Asset value and the exercise price of the option","page_number":54,"box":{"x":102,"y":543,"width":780,"height":12}},{"id":"3dc84c59-3677-487f-bae2-bc626195d3ec","block_type":"box","text":"(times the applicable multiplier) to the assigned writer.","page_number":54,"box":{"x":102,"y":559,"width":387,"height":11}},{"id":"ff7388b7-deda-4365-a79b-e8c77e3ef00a","block_type":"box","text":"Foreign Exchange Transactions.","page_number":54,"box":{"x":102,"y":582,"width":222,"height":11}},{"id":"d5335755-e413-4f78-8cbf-65cd2daaae4d","block_type":"box","text":"A Fund may enter into spot foreign exchange transactions, forward foreign exchange transactions (“FX forwards”)","page_number":54,"box":{"x":101,"y":604,"width":807,"height":11}},{"id":"8b811619-bf75-4325-b537-8247352cb267","block_type":"box","text":"and currency swaps, purchase and sell currency options, currency futures and related options thereon (collectively,","page_number":54,"box":{"x":69,"y":619,"width":818,"height":11}},{"id":"6f3969a9-da76-47e0-a353-2a3d42f7ab5d","block_type":"box","text":"“Currency Instruments”) for purposes of hedging against the decline in the value of currencies in which its por tfolio","page_number":54,"box":{"x":70,"y":634,"width":821,"height":12}},{"id":"e2a11994-0b1c-4497-ba26-fd2c79e212d1","block_type":"box","text":"holdings are denominated against the U.S. dollar or, with respect to cer tain Funds, to seek to enhance returns.","page_number":54,"box":{"x":69,"y":649,"width":792,"height":12}},{"id":"0bd06ab1-3c82-4034-b831-2f955f069145","block_type":"box","text":"Such transactions could be effected to hedge with respect to foreign dollar denominated securities owned by a","page_number":54,"box":{"x":102,"y":672,"width":790,"height":11}},{"id":"5d77a2c2-831a-4c2a-9249-548e2ca035e6","block_type":"box","text":"Fund, sold by a Fund but not yet delivered, or committed or anticipated to be purchased by a Fund. As an illustration,","page_number":54,"box":{"x":70,"y":687,"width":830,"height":11}},{"id":"c333b1a9-b100-4eb7-b54f-9fc2a6366f71","block_type":"box","text":"a Fund may use such techniques to hedge the stated value in U.S. dollars of an investment in a yen-denominated","page_number":54,"box":{"x":69,"y":702,"width":808,"height":12}},{"id":"6e943fca-9734-4a80-bf7a-1005e67b793d","block_type":"box","text":"security. For example, the Fund may purchase a foreign currency put option enabling it to sell a specified amount of","page_number":54,"box":{"x":69,"y":717,"width":824,"height":12}},{"id":"9ec09367-15e6-4088-add0-019a0d02e777","block_type":"box","text":"yen for dollars at a specified price by a future date. To the extent the hedge is successful, a loss in the value of the","page_number":54,"box":{"x":68,"y":732,"width":823,"height":12}},{"id":"788247a2-3c94-4d35-b4fb-17dedd3274e5","block_type":"box","text":"yen relative to the dollar will tend to be offset by an increase in the value of the put option. To offset, in whole or in","page_number":54,"box":{"x":68,"y":748,"width":821,"height":11}},{"id":"f37ca8f8-9d68-4fad-a1c3-40bb23536aa4","block_type":"box","text":"par t, the cost of acquiring such a put option, the Fund may also sell a call option which, if exercised, requires it to","page_number":54,"box":{"x":70,"y":763,"width":813,"height":11}},{"id":"7055a255-4540-43e8-9c8d-158fc64e183b","block_type":"box","text":"sell a specified amount of yen for dollars at a specified price by a future date (a technique called a “straddle”). By","page_number":54,"box":{"x":69,"y":778,"width":813,"height":11}},{"id":"8197e5c5-f36a-4851-a45e-6b4eb8912a5c","block_type":"box","text":"selling such a call option in this illustration, the Fund gives up the oppor tunity to profit without limit from increases in","page_number":54,"box":{"x":69,"y":793,"width":835,"height":11}},{"id":"7a792577-ae6f-49ee-9824-8030a3437777","block_type":"box","text":"the relative value of the yen to the dollar. “Straddles” of the type that may be used by a Fund are considered hedging","page_number":54,"box":{"x":68,"y":808,"width":836,"height":11}},{"id":"5ee6b12b-def0-437a-b45f-8e0bb5909711","block_type":"box","text":"transactions. Cer tain Funds have a fundamental investment restriction that restricts currency option strategies.","page_number":54,"box":{"x":68,"y":823,"width":794,"height":12}},{"id":"4c82f46b-35f1-41dc-9914-ff3ece5097e3","block_type":"box","text":"Hedging transactions involving Currency Instruments involve substantial risks, including correlation risk. A Fund’s","page_number":54,"box":{"x":102,"y":846,"width":805,"height":11}},{"id":"988311a0-a598-48d2-95bb-25feb31cf221","block_type":"box","text":"use of Currency Instruments to effect hedging strategies is intended to reduce the volatility of the NAV of the Fund’s","page_number":54,"box":{"x":69,"y":861,"width":828,"height":11}},{"id":"77c99772-3a7e-4029-9a2d-7e2af5219235","block_type":"box","text":"shares; however, the use of such hedging strategies will not prevent the NAV of the Fund’s shares from fluctuating.","page_number":54,"box":{"x":69,"y":876,"width":819,"height":11}},{"id":"680ced85-2a96-43a5-b82b-5926afd40ee4","block_type":"box","text":"Moreover, although Currency Instruments will be used with the intention of hedging against adverse currency","page_number":54,"box":{"x":70,"y":891,"width":773,"height":12}},{"id":"bac1b268-a5d8-4e2a-9a1a-7641475767c2","block_type":"box","text":"movements, transactions in Currency Instruments involve the risk that anticipated currency movements will not be","page_number":54,"box":{"x":69,"y":906,"width":814,"height":12}},{"id":"24bf4f37-4099-4045-af45-5c6aec63bace","block_type":"box","text":"II-23","page_number":54,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"bb43866a-9223-4a45-a680-50a5c2c0f27b","block_type":"box","text":"NM1026U-5982568-54/232","page_number":54,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"85e4718e-7301-4994-bdc6-bdfed1ffbc75","block_type":"box","text":"accurately predicted and that the Fund’s hedging strategies will be ineffective. To the extent that a Fund hedges","page_number":55,"box":{"x":69,"y":45,"width":796,"height":11}},{"id":"2fbd120b-92c9-484d-9fb4-363724aa9d42","block_type":"box","text":"against anticipated currency movements that do not occur, the Fund may realize losses and decrease its total return.","page_number":55,"box":{"x":69,"y":60,"width":835,"height":11}},{"id":"63380806-aeb3-4a4e-9650-ebaac26fda07","block_type":"box","text":"Fur thermore, a Fund will only engage in hedging activities from time to time and may not be engaging in hedging","page_number":55,"box":{"x":70,"y":75,"width":798,"height":11}},{"id":"00446705-b366-48f3-9d85-10b04dc59f1d","block_type":"box","text":"activities when movements in currency exchange rates actually occur.","page_number":55,"box":{"x":69,"y":90,"width":493,"height":11}},{"id":"5438e276-48a8-46d5-a164-8817a312f52a","block_type":"box","text":"In connection with its trading in forward foreign currency contracts, a Fund will contract with a foreign or","page_number":55,"box":{"x":102,"y":113,"width":738,"height":11}},{"id":"a2054874-05c4-4799-b6a9-7f3a065477c5","block_type":"box","text":"domestic bank, or foreign or domestic securities dealer, to make or take future delivery of a specified amount of a","page_number":55,"box":{"x":69,"y":128,"width":814,"height":11}},{"id":"38d58fa5-5118-40fe-a08c-4d1ebbabe019","block_type":"box","text":"par ticular currency. There are no limitations on daily price moves in such forward contracts, and banks and dealers","page_number":55,"box":{"x":70,"y":143,"width":819,"height":11}},{"id":"c2a3af2c-aa57-4afc-8d51-6657fac58fc6","block_type":"box","text":"are not required to continue to make markets in such contracts. There have been periods during which cer tain banks","page_number":55,"box":{"x":69,"y":158,"width":834,"height":11}},{"id":"542d527c-8c35-41ae-9d04-c6f1c3dd52cd","block_type":"box","text":"or dealers have refused to quote prices for such forward contracts or have quoted prices with an unusually wide","page_number":55,"box":{"x":69,"y":173,"width":797,"height":11}},{"id":"0ec9f5f1-f273-4b3d-85fa-b6eeb3d9b6e2","block_type":"box","text":"spread between the price at which the bank or dealer is prepared to buy and that at which it is prepared to sell.","page_number":55,"box":{"x":69,"y":188,"width":794,"height":11}},{"id":"ee8aa790-7730-4028-9edd-2efb5118db86","block_type":"box","text":"Governmental imposition of currency controls might limit any such forward contract trading. With respect to its trading","page_number":55,"box":{"x":69,"y":203,"width":841,"height":12}},{"id":"c90b1c81-e108-4340-a606-c66397089b4d","block_type":"box","text":"of forward contracts, if any, a Fund will be subject to counterpar ty risk. Any such failure to per form by a counterpar ty","page_number":55,"box":{"x":69,"y":218,"width":831,"height":12}},{"id":"c813871c-e92c-4ec1-9917-839e27efd91d","block_type":"box","text":"would deprive the Fund of any profit potential or force the Fund to cover its commitments for resale, if any, at the","page_number":55,"box":{"x":68,"y":234,"width":805,"height":11}},{"id":"6dde425d-4e7b-4133-9fbd-534e1ece0a67","block_type":"box","text":"then market price and could result in a loss to the Fund.","page_number":55,"box":{"x":68,"y":249,"width":401,"height":11}},{"id":"9ad88312-2647-4797-b90d-7bebaee2a38f","block_type":"box","text":"It may not be possible for a Fund to hedge against currency exchange rate movements, even if correctly","page_number":55,"box":{"x":102,"y":271,"width":738,"height":12}},{"id":"29fd7579-5f44-4521-a0f0-2dc5315b5885","block_type":"box","text":"anticipated, in the event that (i) the currency exchange rate movement is so generally anticipated that the Fund is not","page_number":55,"box":{"x":69,"y":287,"width":837,"height":11}},{"id":"af550ba4-1752-4a57-9c2a-6cb11ca4c125","block_type":"box","text":"able to enter into a hedging transaction at an effective price, or (ii) the currency exchange rate movement relates to a","page_number":55,"box":{"x":69,"y":302,"width":837,"height":11}},{"id":"a13b9f68-407a-4da8-b8a9-ce5162e23f14","block_type":"box","text":"market with respect to which Currency Instruments are not available and it is not possible to engage in effective","page_number":55,"box":{"x":69,"y":317,"width":800,"height":11}},{"id":"d1cb08dc-b04e-4b33-b6bf-62baf571bc3f","block_type":"box","text":"foreign currency hedging. The cost to a Fund of engaging in foreign currency transactions varies with such factors as","page_number":55,"box":{"x":68,"y":332,"width":829,"height":11}},{"id":"155d6a03-755f-48df-9e2e-453016a64434","block_type":"box","text":"the currencies involved, the length of the contract period and the market conditions then prevailing. Since","page_number":55,"box":{"x":68,"y":347,"width":753,"height":11}},{"id":"0fd7d6bc-14bb-4c72-9717-5b82800ef627","block_type":"box","text":"transactions in foreign currency exchange usually are conducted on a principal basis, no fees or commissions are","page_number":55,"box":{"x":68,"y":362,"width":811,"height":11}},{"id":"6d36713e-6245-4376-a8de-06077a0c169a","block_type":"box","text":"involved.","page_number":55,"box":{"x":70,"y":377,"width":59,"height":9}},{"id":"b4ed18fc-fc52-4391-bb3a-1303cc9c5eff","block_type":"box","text":"A Fund will not hedge a currency in excess of the aggregate market value of the securities that it owns (including","page_number":55,"box":{"x":101,"y":400,"width":803,"height":11}},{"id":"061b590d-7a9a-4dfb-897e-42868d0979da","block_type":"box","text":"receivables for unsettled securities sales), or has committed to purchase or anticipates purchasing, which are","page_number":55,"box":{"x":69,"y":415,"width":785,"height":11}},{"id":"3508e6f8-d992-4351-9c1f-522f906f2742","block_type":"box","text":"denominated in such currency.","page_number":55,"box":{"x":69,"y":430,"width":216,"height":11}},{"id":"85275237-d7df-4a44-8123-76240c23165b","block_type":"box","text":"Spot Transactions and FX Forwards.","page_number":55,"box":{"x":102,"y":453,"width":254,"height":11}},{"id":"4a19b032-18ad-4bd9-bbd4-2058aec705e0","block_type":"box","text":"FX forwards are OTC contracts to purchase or sell a specified amount of a","page_number":55,"box":{"x":364,"y":453,"width":527,"height":11}},{"id":"83bb7d83-95c3-4faf-9721-efd3b2354c95","block_type":"box","text":"specified currency or multinational currency unit at a specified price and specified future date. Spot foreign exchange","page_number":55,"box":{"x":69,"y":468,"width":834,"height":11}},{"id":"775711c0-ed19-49ac-aabe-9f4413e5a0f9","block_type":"box","text":"transactions are similar but are settled in the current, or “spot”, market. A Fund will enter into foreign exchange","page_number":55,"box":{"x":68,"y":483,"width":798,"height":11}},{"id":"251a88dd-3a48-4db0-8aa3-3bcda8434590","block_type":"box","text":"transactions for purposes of hedging either a specific transaction or a por tfolio position, or, with respect to cer tain","page_number":55,"box":{"x":68,"y":498,"width":817,"height":11}},{"id":"4388d096-fae6-4786-a26c-baa1c0a1e844","block_type":"box","text":"Funds, to seek to enhance returns. FX forwards involve substantial currency risk, credit risk and liquidity risk. A Fund","page_number":55,"box":{"x":70,"y":513,"width":830,"height":11}},{"id":"9ef0dcc8-3cd3-4e95-a3a3-f487c019c96c","block_type":"box","text":"may enter into a foreign exchange transaction for purposes of hedging a specific transaction by, for example,","page_number":55,"box":{"x":69,"y":528,"width":774,"height":12}},{"id":"51868b02-4dba-4c1d-a0c4-f47c773f50c7","block_type":"box","text":"purchasing a currency needed to settle a security transaction or selling a currency in which the Fund has received or","page_number":55,"box":{"x":70,"y":544,"width":828,"height":11}},{"id":"0145ea65-6906-4c00-adf0-7b62e69a4ea3","block_type":"box","text":"anticipates receiving a dividend or distribution. A Fund may enter into a foreign exchange transaction for purposes of","page_number":55,"box":{"x":69,"y":559,"width":830,"height":11}},{"id":"f9a74afe-f23a-4096-96fc-8ced1bba386d","block_type":"box","text":"hedging a por tfolio position by selling forward a currency in which a por tfolio position of the Fund is denominated or","page_number":55,"box":{"x":69,"y":574,"width":826,"height":11}},{"id":"cefff08c-9189-4002-872a-b86991b023e2","block_type":"box","text":"by purchasing a currency in which the Fund anticipates acquiring a por tfolio position in the near future. A Fund may","page_number":55,"box":{"x":69,"y":589,"width":819,"height":11}},{"id":"16449e48-c16e-4a4b-bb4c-b47c2a718929","block_type":"box","text":"also hedge a currency by entering into a transaction in a Currency Instrument denominated in a currency other than","page_number":55,"box":{"x":69,"y":604,"width":822,"height":11}},{"id":"360fdca8-a65c-4bd9-833c-7c89e3ceecbf","block_type":"box","text":"the currency being hedged (a “cross-hedge”). A Fund will only enter into a cross-hedge if the Manager believes that","page_number":55,"box":{"x":68,"y":619,"width":819,"height":11}},{"id":"6536eb7a-05a0-4496-a62d-73568f8376c8","block_type":"box","text":"(i) there is a demonstrably high correlation between the currency in which the cross-hedge is denominated and the","page_number":55,"box":{"x":69,"y":634,"width":814,"height":12}},{"id":"d1f66a07-5e48-4107-909c-881298d40392","block_type":"box","text":"currency being hedged, and (ii) executing a cross-hedge through the currency in which the cross-hedge is","page_number":55,"box":{"x":69,"y":650,"width":745,"height":11}},{"id":"12c0538b-495c-46da-9aa6-55f38505ac18","block_type":"box","text":"denominated will be significantly more cost-effective or provide substantially greater liquidity than executing a similar","page_number":55,"box":{"x":69,"y":664,"width":832,"height":12}},{"id":"631d0d21-1615-4e44-9fa1-52d6a962462f","block_type":"box","text":"hedging transaction by means of the currency being hedged.","page_number":55,"box":{"x":69,"y":680,"width":428,"height":11}},{"id":"5a32be39-4456-4b68-ad59-2333dfadc1ef","block_type":"box","text":"A Fund may also engage in proxy hedging transactions to reduce the effect of currency fluctuations on the value","page_number":55,"box":{"x":101,"y":702,"width":797,"height":12}},{"id":"10ddd4c4-a89f-4a9e-a488-c5b7027e132f","block_type":"box","text":"of existing or anticipated holdings of por tfolio securities. Proxy hedging is often used when the currency to which the","page_number":55,"box":{"x":69,"y":717,"width":829,"height":12}},{"id":"165f14b0-a61a-4690-9f37-4c922b070686","block_type":"box","text":"Fund is exposed is difficult to hedge, or to hedge against the U.S. dollar. Proxy hedging entails entering into a forward","page_number":55,"box":{"x":70,"y":732,"width":838,"height":12}},{"id":"c9cda133-3e1b-4df3-aea0-c6fcc6088222","block_type":"box","text":"contract to sell a currency whose changes in value are generally considered to be linked to a currency or currencies","page_number":55,"box":{"x":69,"y":748,"width":823,"height":11}},{"id":"635b0847-fa31-4d87-af07-ea7763654b10","block_type":"box","text":"in which some or all of the Fund’s securities are, or are expected to be, denominated, and to buy U.S. dollars. Proxy","page_number":55,"box":{"x":70,"y":763,"width":827,"height":11}},{"id":"12466c62-39b3-478a-9984-2eda54071172","block_type":"box","text":"hedging involves some of the same risks and considerations as other transactions with similar instruments. Currency","page_number":55,"box":{"x":69,"y":778,"width":838,"height":11}},{"id":"e68eaea8-77a9-44a9-8676-452ae6042e93","block_type":"box","text":"transactions can result in losses to the Fund if the currency being hedged fluctuates in value to a degree or in a","page_number":55,"box":{"x":68,"y":793,"width":798,"height":11}},{"id":"e4e6af1a-8a88-48dd-8b09-bf524e698943","block_type":"box","text":"direction that is not anticipated. In addition, there is the risk that the perceived linkage between various currencies","page_number":55,"box":{"x":69,"y":808,"width":819,"height":11}},{"id":"322aeb6d-36fa-4bd8-8392-5a20a8d11953","block_type":"box","text":"may not be present, including during the par ticular time that a Fund is engaging in proxy hedging.","page_number":55,"box":{"x":69,"y":823,"width":691,"height":12}},{"id":"20ae42fa-44ce-4aa2-8de0-91a867f1f8ab","block_type":"box","text":"A Fund may also cross-hedge currencies by entering into forward contracts to sell one or more currencies that","page_number":55,"box":{"x":101,"y":846,"width":785,"height":11}},{"id":"9e2cd5d3-ec52-47a5-96f3-dab78addf0ba","block_type":"box","text":"are expected to decline in value relative to other currencies to which the Fund has or in which the Fund expects to","page_number":55,"box":{"x":69,"y":861,"width":811,"height":11}},{"id":"bb237eec-eb91-4fda-b7c4-88e0c24e478c","block_type":"box","text":"have por tfolio exposure. For example, a Fund may hold both Canadian government bonds and Japanese government","page_number":55,"box":{"x":69,"y":876,"width":828,"height":11}},{"id":"c2606b3c-8c78-48b2-a59a-66a5e9f5fef2","block_type":"box","text":"bonds, and the Manager or sub-adviser may believe that Canadian dollars will deteriorate against Japanese yen. The","page_number":55,"box":{"x":69,"y":891,"width":829,"height":12}},{"id":"6c31fde1-aa54-488d-b2bb-433cde9caf4a","block_type":"box","text":"Fund would sell Canadian dollars to reduce its exposure to that currency and buy Japanese yen. This strategy would","page_number":55,"box":{"x":70,"y":906,"width":823,"height":12}},{"id":"a7c650da-13ad-4b63-a720-534f57c0e97e","block_type":"box","text":"II-24","page_number":55,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"6f69c7ee-69fa-4baa-a514-ccacc8633f56","block_type":"box","text":"NM1026U-5982568-55/232","page_number":55,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"d4b14d5a-4617-4823-ba7a-b7283c0e36d4","block_type":"box","text":"be a hedge against a decline in the value of Canadian dollars, although it would expose the Fund to declines in the","page_number":56,"box":{"x":69,"y":45,"width":818,"height":11}},{"id":"ef5adcf3-cf10-4188-8722-2ffeae49bfc5","block_type":"box","text":"value of the Japanese yen relative to the U.S. dollar.","page_number":56,"box":{"x":68,"y":60,"width":372,"height":11}},{"id":"3cfc1809-e710-4294-b1ea-7d0c0b506725","block_type":"box","text":"Some of the forward non-U.S. currency contracts entered into by the Funds are classified as non-deliverable","page_number":56,"box":{"x":102,"y":82,"width":768,"height":12}},{"id":"8468420d-6c73-4483-be29-8d11bc6be455","block_type":"box","text":"forwards (“NDFs”). NDFs are cash-settled, shor t-term forward contracts that may be thinly traded or are denominated","page_number":56,"box":{"x":68,"y":98,"width":838,"height":11}},{"id":"ad8e7a7c-f871-4641-ad9d-32bb8ef08dd7","block_type":"box","text":"in non-conver tible foreign currency, where the profit or loss at the time at the settlement date is calculated by taking","page_number":56,"box":{"x":70,"y":113,"width":829,"height":11}},{"id":"8408a295-45a3-431b-b3f9-9c2827b4a4ad","block_type":"box","text":"the difference between the agreed upon exchange rate and the spot rate at the time of settlement, for an agreed","page_number":56,"box":{"x":68,"y":128,"width":806,"height":11}},{"id":"a0467a2c-6334-4569-b7d7-9c545bc2897d","block_type":"box","text":"upon notional amount of funds. All NDFs have a fixing date and a settlement date. The fixing date is the date at which","page_number":56,"box":{"x":69,"y":143,"width":839,"height":11}},{"id":"e837403a-5bd9-45c1-9a6f-91f0d0f25295","block_type":"box","text":"the difference between the prevailing market exchange rate and the agreed upon exchange rate is calculated. The","page_number":56,"box":{"x":68,"y":158,"width":812,"height":11}},{"id":"1f8d3338-adbe-4783-a38c-1e0ab225eb03","block_type":"box","text":"settlement date is the date by which the payment of the difference is due to the par ty receiving payment. NDFs are","page_number":56,"box":{"x":69,"y":173,"width":821,"height":11}},{"id":"ad6952ae-b9e2-45f0-8660-78171098cf5a","block_type":"box","text":"commonly quoted for time periods of one month up to two years, and are normally quoted and settled in U.S. dollars.","page_number":56,"box":{"x":69,"y":188,"width":835,"height":11}},{"id":"8334d8d4-75eb-4f3f-95c0-80f01a5dae45","block_type":"box","text":"They are often used to gain exposure to and/or hedge exposure to foreign currencies that are not internationally","page_number":56,"box":{"x":68,"y":203,"width":802,"height":12}},{"id":"aa7776ec-89a9-40bb-9b36-9774e4b29292","block_type":"box","text":"traded.","page_number":56,"box":{"x":68,"y":219,"width":49,"height":8}},{"id":"b91a03e8-c230-4d15-b9a3-0aee7612098d","block_type":"box","text":"Currency Futures.","page_number":56,"box":{"x":102,"y":241,"width":123,"height":11}},{"id":"69adbc57-a98a-4959-859e-0eb3cdd299b6","block_type":"box","text":"A Fund may seek to enhance returns or hedge against the decline in the value of a currency","page_number":56,"box":{"x":232,"y":241,"width":654,"height":11}},{"id":"1802da78-8bd2-4451-bbd9-9d05802d0500","block_type":"box","text":"through use of currency futures or options on currency futures. Currency futures are similar to forward foreign","page_number":56,"box":{"x":68,"y":256,"width":782,"height":12}},{"id":"67b6e3ae-0a82-4a08-ab53-837949410f1c","block_type":"box","text":"exchange transactions except that futures are standardized, exchange-traded contracts while forward foreign","page_number":56,"box":{"x":69,"y":271,"width":774,"height":12}},{"id":"33b25197-075c-4b1a-bcda-914c515d8c6d","block_type":"box","text":"exchange transactions are traded in the OTC market. Currency futures involve substantial currency risk as well as the","page_number":56,"box":{"x":69,"y":286,"width":836,"height":12}},{"id":"042ccb8b-153c-439c-8074-b52a424aec30","block_type":"box","text":"risks discussed above in “—Futures.”","page_number":56,"box":{"x":69,"y":302,"width":269,"height":9}},{"id":"a1b4376d-74a6-48ec-9a7a-7434427467c3","block_type":"box","text":"Currency Options.","page_number":56,"box":{"x":102,"y":324,"width":125,"height":11}},{"id":"e1cb1775-0307-4e90-9759-9e51efde75c5","block_type":"box","text":"A Fund may seek to enhance returns or hedge against the decline in the value of a currency","page_number":56,"box":{"x":233,"y":324,"width":654,"height":12}},{"id":"028f73fb-f350-4c07-97ce-9415e4d7965c","block_type":"box","text":"through the use of currency options. Cer tain Funds have fundamental investment restrictions that permit the","page_number":56,"box":{"x":68,"y":339,"width":776,"height":12}},{"id":"6f06ac4b-122d-43bc-bf29-9ef6d0660ad5","block_type":"box","text":"purchase of currency options, but prohibit the writing of currency options. Currency options are similar to options on","page_number":56,"box":{"x":70,"y":355,"width":825,"height":11}},{"id":"5298a6f6-9c16-4372-aec8-12181a1fb54a","block_type":"box","text":"securities. For example, in consideration for an option premium the writer of a currency option is obligated to sell (in","page_number":56,"box":{"x":69,"y":370,"width":827,"height":11}},{"id":"821d916b-c7b3-4627-8fba-97bc7f3b9d9f","block_type":"box","text":"the case of a call option) or purchase (in the case of a put option) a specified amount of a specified currency on or","page_number":56,"box":{"x":68,"y":385,"width":820,"height":11}},{"id":"a805b9cf-e5d4-4344-b356-2858d5d948cc","block_type":"box","text":"before the expiration date for a specified amount of another currency. A Fund may engage in transactions in options","page_number":56,"box":{"x":69,"y":400,"width":824,"height":11}},{"id":"c7885279-317a-4499-bee8-55b4c3e53b40","block_type":"box","text":"on currencies either on exchanges or OTC markets. Such transactions in options may include exotic options on","page_number":56,"box":{"x":69,"y":415,"width":790,"height":11}},{"id":"2aa2fa8b-acab-4be8-9d6f-a3cc91008253","block_type":"box","text":"currencies, which are typically traded in OTC markets and have additional features that result in different payment","page_number":56,"box":{"x":69,"y":430,"width":813,"height":11}},{"id":"1767acd5-e51b-4246-992f-4a678a7ef832","block_type":"box","text":"structures and/or expirations. Where a Fund is permitted to write currency options, it may write covered call options","page_number":56,"box":{"x":69,"y":446,"width":826,"height":10}},{"id":"c62f7dab-c2ca-4ae8-be23-9b70732c5330","block_type":"box","text":"on up to 100% of the currencies in its por tfolio. See “—Options” above. Currency options involve substantial","page_number":56,"box":{"x":69,"y":460,"width":776,"height":12}},{"id":"c9436a53-3e57-4d30-a91c-60435315bb83","block_type":"box","text":"currency risk, and may also involve credit, leverage or illiquidity risk.","page_number":56,"box":{"x":69,"y":476,"width":483,"height":11}},{"id":"91b1fff8-a417-4ba1-8bc5-a8017c1d5c9d","block_type":"box","text":"Currency Swaps.","page_number":56,"box":{"x":102,"y":498,"width":117,"height":11}},{"id":"103b660d-51e0-493d-bdaa-3bad26abe1a3","block_type":"box","text":"A Fund may enter into currency swaps in order to protect against currency fluctuations or to","page_number":56,"box":{"x":225,"y":498,"width":652,"height":11}},{"id":"324e614e-ac1b-4023-b4e1-3bd73c8c7518","block_type":"box","text":"hedge por tfolio positions. Currency swaps are transactions in which one currency is simultaneously bought for a","page_number":56,"box":{"x":69,"y":513,"width":799,"height":12}},{"id":"d9f0e995-bace-454a-9f74-85769c49d6b1","block_type":"box","text":"second currency on a spot basis and sold for the second currency on a forward basis. Currency swaps involve the","page_number":56,"box":{"x":69,"y":528,"width":812,"height":12}},{"id":"e04652ff-8413-4e6a-9a0b-bc789c79754b","block_type":"box","text":"exchange of the rights of a Fund and another par ty to make or receive payments in specified currencies, and typically","page_number":56,"box":{"x":69,"y":543,"width":836,"height":12}},{"id":"445db010-dbbe-4613-8d46-31ab1e0c58c7","block_type":"box","text":"require the delivery of the entire principal value of one designated currency in exchange for the other designated","page_number":56,"box":{"x":69,"y":559,"width":800,"height":11}},{"id":"277541a0-adbe-4e2b-b4c1-bd5b9173625f","block_type":"box","text":"currency. As a result, the entire principal value of a currency swap is subject to the risk that the other par ty to the","page_number":56,"box":{"x":69,"y":574,"width":810,"height":11}},{"id":"ead4abee-3392-4bd8-a719-5459c8fad766","block_type":"box","text":"swap will default on its contractual delivery obligations.","page_number":56,"box":{"x":69,"y":589,"width":393,"height":11}},{"id":"700d404c-5069-413e-8f67-af5faf582724","block_type":"box","text":"Distressed Securities.","page_number":56,"box":{"x":102,"y":612,"width":159,"height":9}},{"id":"69212aa7-9192-4ac0-8918-3adec6ba5786","block_type":"box","text":"A Fund may invest in securities, including loans purchased in the secondary market, that","page_number":56,"box":{"x":267,"y":612,"width":633,"height":11}},{"id":"84d5d5b0-0abd-4e41-8137-037f2d273c13","block_type":"box","text":"are the subject of bankruptcy proceedings or otherwise in default or in risk of being in default as to the repayment of","page_number":56,"box":{"x":69,"y":627,"width":834,"height":11}},{"id":"650dccbe-77a2-49ae-b0fe-7f9c2ba126a0","block_type":"box","text":"principal and/or interest at the time of acquisition by the Fund or that are rated in the lower rating categories by one","page_number":56,"box":{"x":70,"y":642,"width":827,"height":11}},{"id":"d0122288-6036-4e0e-ab9b-0f889c176c40","block_type":"box","text":"or more nationally recognized statistical rating organizations (for example, Ca or lower by Moody’s and CC or lower by","page_number":56,"box":{"x":69,"y":657,"width":835,"height":11}},{"id":"b18a4cfa-8176-4212-9f9b-9a0f11e54bc3","block_type":"box","text":"S&P or Fitch) or, if unrated, are in the judgment of the Manager of equivalent quality (“Distressed Securities”).","page_number":56,"box":{"x":69,"y":672,"width":784,"height":11}},{"id":"0e6be3f7-7fa3-4cf6-92f5-153167d478f3","block_type":"box","text":"Investment in Distressed Securities is speculative and involves significant risks.","page_number":56,"box":{"x":70,"y":687,"width":569,"height":11}},{"id":"8ff21fda-e563-4115-8f62-e0933491ccf0","block_type":"box","text":"A Fund will generally make such investments only when the Manager believes it is reasonably likely that the","page_number":56,"box":{"x":101,"y":710,"width":766,"height":11}},{"id":"9d1c071c-6c09-432a-9288-8c447241e9c9","block_type":"box","text":"issuer of the Distressed Securities will make an exchange offer or will be the subject of a plan of reorganization","page_number":56,"box":{"x":70,"y":725,"width":795,"height":11}},{"id":"980b0b42-213b-458c-8dd4-a793539ebbb5","block_type":"box","text":"pursuant to which the Fund will receive new securities in return for the Distressed Securities. However, there can be","page_number":56,"box":{"x":70,"y":740,"width":826,"height":11}},{"id":"3bfceb6d-ca13-4b9a-8c21-89eb4abde11f","block_type":"box","text":"no assurance that such an exchange offer will be made or that such a plan of reorganization will be adopted. In","page_number":56,"box":{"x":69,"y":755,"width":794,"height":11}},{"id":"73251907-737f-4bd0-9d85-e028d539a4d4","block_type":"box","text":"addition, a significant period of time may pass between the time at which a Fund makes its investment in Distressed","page_number":56,"box":{"x":69,"y":770,"width":832,"height":12}},{"id":"7f68f383-b36e-4640-b0e3-e95636466aef","block_type":"box","text":"Securities and the time that any such exchange offer or plan of reorganization is completed. During this period, it is","page_number":56,"box":{"x":69,"y":785,"width":824,"height":12}},{"id":"7873ed90-4a6d-4c7b-b620-77ab9790fed1","block_type":"box","text":"unlikely that a Fund will receive any interest payments on the Distressed Securities, the Fund will be subject to","page_number":56,"box":{"x":69,"y":801,"width":789,"height":11}},{"id":"12f0e7c4-bb8c-4e07-9e0b-ecf0aa2bad2e","block_type":"box","text":"significant uncer tainty as to whether or not the exchange offer or plan of reorganization will be completed and the","page_number":56,"box":{"x":69,"y":816,"width":810,"height":11}},{"id":"a33d73c9-e660-4ef0-b3d3-aba32e701752","block_type":"box","text":"Fund may be required to bear cer tain extraordinary expenses to protect and recover its investment. Therefore, to the","page_number":56,"box":{"x":70,"y":831,"width":831,"height":11}},{"id":"473c8999-4a98-4688-9b2f-a74f52713ac7","block_type":"box","text":"extent the Fund seeks capital appreciation through investment in distressed securities, the Fund’s ability to achieve","page_number":56,"box":{"x":69,"y":846,"width":826,"height":11}},{"id":"b73dd374-b239-4c0f-9ca3-ff81b2e3eb18","block_type":"box","text":"current income for its shareholders may be diminished. The Fund also will be subject to significant uncer tainty as to","page_number":56,"box":{"x":69,"y":861,"width":827,"height":11}},{"id":"069125f9-54d3-4993-a18f-f9bef4ca3892","block_type":"box","text":"when and in what manner and for what value the obligations evidenced by the distressed securities will eventually be","page_number":56,"box":{"x":68,"y":876,"width":834,"height":11}},{"id":"17fd08f9-f78f-4527-a87f-4629ffb33147","block_type":"box","text":"satisfied (","page_number":56,"box":{"x":69,"y":891,"width":70,"height":11}},{"id":"d1eca8dd-6348-4f26-bdb4-9c447f75711a","block_type":"box","text":"e.g.","page_number":56,"box":{"x":140,"y":893,"width":25,"height":10}},{"id":"2c65cfac-c40d-4074-9fa8-c876f300a11b","block_type":"box","text":", through a liquidation of the obligor’s assets, an exchange offer or plan of reorganization involving the","page_number":56,"box":{"x":168,"y":891,"width":729,"height":12}},{"id":"e9182f3d-5f62-4304-a4bf-c9b53df9764c","block_type":"box","text":"distressed securities or a payment of some amount in satisfaction of the obligation). Even if an exchange offer is","page_number":56,"box":{"x":69,"y":906,"width":807,"height":12}},{"id":"be1d2586-807b-4c96-8b0a-7fd3f5158ad7","block_type":"box","text":"II-25","page_number":56,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"6318ca69-e96f-4b05-853e-2b86221048a0","block_type":"box","text":"NM1026U-5982568-56/232","page_number":56,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"8b717760-7990-4517-82db-3645a4b727e7","block_type":"box","text":"made or plan of reorganization is adopted with respect to Distressed Securities held by a Fund, there can be no","page_number":57,"box":{"x":69,"y":45,"width":797,"height":11}},{"id":"7ee2af35-f371-4dec-8f29-d4528a2be9ab","block_type":"box","text":"assurance that the securities or other assets received by a Fund in connection with such exchange offer or plan of","page_number":57,"box":{"x":69,"y":60,"width":816,"height":11}},{"id":"28b67285-5c2b-410f-b4e0-70e1967e9828","block_type":"box","text":"reorganization will not have a lower value or income potential than may have been anticipated when the investment","page_number":57,"box":{"x":69,"y":75,"width":821,"height":11}},{"id":"81cbadc2-5846-4b3a-b9e9-7597e0d9efb3","block_type":"box","text":"was made or no value. Moreover, any securities received by a Fund upon completion of an exchange offer or plan of","page_number":57,"box":{"x":68,"y":90,"width":827,"height":11}},{"id":"4549dd5f-f80c-47eb-9256-46f4cf491d2f","block_type":"box","text":"reorganization may be restricted as to resale. Similarly, if a Fund par ticipates in negotiations with respect to any","page_number":57,"box":{"x":69,"y":105,"width":800,"height":11}},{"id":"ff9979e8-2df5-4774-a141-54b38ffaf9cf","block_type":"box","text":"exchange offer or plan of reorganization with respect to an issuer of Distressed Securities, the Fund may be","page_number":57,"box":{"x":69,"y":120,"width":770,"height":12}},{"id":"961e8bd0-9410-4ba4-b117-5d0f620e92f9","block_type":"box","text":"restricted from disposing of such securities. To the extent that a Fund becomes involved in such proceedings, the","page_number":57,"box":{"x":69,"y":135,"width":809,"height":12}},{"id":"78b74264-4542-4f8a-ad50-55c503b5d689","block_type":"box","text":"Fund may have a more active par ticipation in the affairs of the issuer than that assumed generally by an investor. The","page_number":57,"box":{"x":70,"y":150,"width":839,"height":12}},{"id":"5f3f9f89-4590-441d-b844-22b32ba97b4d","block_type":"box","text":"Fund, however, will not make investments for the purpose of exercising day-to-day management of any issuer’s","page_number":57,"box":{"x":70,"y":166,"width":787,"height":11}},{"id":"8fa9e044-29d1-4a6b-92e7-53263b681958","block_type":"box","text":"affairs.","page_number":57,"box":{"x":69,"y":181,"width":49,"height":9}},{"id":"7765e28e-d5df-4ca8-8737-6132f87df81f","block_type":"box","text":"Environmental, Social and Governance (“ESG”) Integration","page_number":57,"box":{"x":102,"y":203,"width":428,"height":11}},{"id":"2b2e6523-59d4-4c74-b3be-33c3a42d5469","block_type":"box","text":". Although a Fund does not seek to implement a","page_number":57,"box":{"x":531,"y":204,"width":341,"height":11}},{"id":"a029d8ab-216c-42a0-8352-8e789e8192ba","block_type":"box","text":"specific sustainability objective, strategy or process unless disclosed in its Prospectus, Fund management will","page_number":57,"box":{"x":69,"y":218,"width":785,"height":12}},{"id":"1ba9639e-f508-4c51-8b9f-7326f8ec5b95","block_type":"box","text":"consider ESG factors as par t of the investment process for the Fund. Fund management views ESG integration as the","page_number":57,"box":{"x":69,"y":234,"width":838,"height":11}},{"id":"2bc19372-c064-49fb-84c8-cc4f33a0318e","block_type":"box","text":"practice of incorporating financially material ESG data or information into investment processes with the objective of","page_number":57,"box":{"x":70,"y":249,"width":827,"height":11}},{"id":"9f5d1f0f-8a0f-4822-9585-1fa24940dd32","block_type":"box","text":"enhancing risk-adjusted returns. These ESG considerations will vary depending on a Fund’s par ticular investment","page_number":57,"box":{"x":69,"y":264,"width":806,"height":11}},{"id":"cd44b076-84ba-45e8-acb4-83f45732052c","block_type":"box","text":"strategies and may include consideration of third-par ty research as well as consideration of proprietary BlackRock","page_number":57,"box":{"x":69,"y":279,"width":812,"height":11}},{"id":"c7ab5c73-3ba1-4573-8876-2a5f2982841d","block_type":"box","text":"research across the ESG risks and oppor tunities regarding an issuer. The ESG characteristics utilized in a Fund’s","page_number":57,"box":{"x":69,"y":294,"width":807,"height":11}},{"id":"d38bc2ea-7e71-4d34-af8f-682800304c8b","block_type":"box","text":"investment process are anticipated to evolve over time and one or more characteristics may not be relevant with","page_number":57,"box":{"x":70,"y":309,"width":800,"height":11}},{"id":"b689fd3e-1751-4259-80df-d28fc00e84f3","block_type":"box","text":"respect to all issuers that are eligible for investment.","page_number":57,"box":{"x":69,"y":324,"width":377,"height":12}},{"id":"9bf3b637-89c1-4986-b6d7-4ccd92b17e03","block_type":"box","text":"Cer tain of these considerations may affect a Fund’s exposure to cer tain companies or industries. While Fund","page_number":57,"box":{"x":102,"y":347,"width":778,"height":11}},{"id":"924705ce-eea4-4c09-9c01-4a5897c697d1","block_type":"box","text":"management views ESG considerations as having the potential to contribute to a Fund’s long-term per formance,","page_number":57,"box":{"x":69,"y":362,"width":800,"height":11}},{"id":"64ebbbfd-fd1f-4123-9f39-c0f2625fc56a","block_type":"box","text":"there is no guarantee that such results will be achieved.","page_number":57,"box":{"x":68,"y":377,"width":400,"height":12}},{"id":"9b9cd66c-9dff-45aa-9e0e-a897c1768f99","block_type":"box","text":"Equity Securities.","page_number":57,"box":{"x":102,"y":400,"width":127,"height":11}},{"id":"0bdec45c-5f23-4a68-ad6a-fa8002c5d44a","block_type":"box","text":"Cer tain Funds may invest in equity securities, which include common stock and, for cer tain","page_number":57,"box":{"x":235,"y":400,"width":648,"height":11}},{"id":"387be365-6f25-464d-829f-869850357988","block_type":"box","text":"Funds, preferred stock (including conver tible preferred stock); bonds, stock purchase warrants and rights; equity","page_number":57,"box":{"x":70,"y":415,"width":802,"height":11}},{"id":"2697b86d-1921-4953-b7ad-5860a06aa62a","block_type":"box","text":"interests in trusts; general and limited par tnerships and limited liability companies; and depositary receipts. Stock","page_number":57,"box":{"x":70,"y":430,"width":817,"height":11}},{"id":"5ef4551f-65a4-4e7f-8191-abed787af69c","block_type":"box","text":"markets are volatile. The price of equity securities will fluctuate and can decline and reduce the value of a por tfolio","page_number":57,"box":{"x":69,"y":445,"width":819,"height":11}},{"id":"42043e53-3e97-4ebd-8392-5f1ecff41493","block_type":"box","text":"investing in equities. The price of equity securities fluctuates based on changes in a company’s financial condition","page_number":57,"box":{"x":70,"y":460,"width":813,"height":12}},{"id":"e793dbb4-8f43-4be0-8859-36508f5816d1","block_type":"box","text":"and overall market and economic conditions. The value of equity securities purchased by the Fund could decline if the","page_number":57,"box":{"x":69,"y":475,"width":839,"height":12}},{"id":"039a196d-463c-49a5-af0a-5593163ae655","block_type":"box","text":"financial condition of the companies the Fund invests in decline or if overall market and economic conditions","page_number":57,"box":{"x":68,"y":491,"width":775,"height":11}},{"id":"072836e0-2f75-413c-8ea4-998f4949bc34","block_type":"box","text":"deteriorate. They may also decline due to factors that affect a par ticular industry or industries, such as labor","page_number":57,"box":{"x":69,"y":506,"width":777,"height":11}},{"id":"77c2216e-838d-4510-a500-fe4e4449605b","block_type":"box","text":"shor tages or increase in production costs and competitive conditions within an industry. In addition, they may decline","page_number":57,"box":{"x":69,"y":521,"width":837,"height":11}},{"id":"0cd9ca36-fad8-4ab1-9244-212bb3601bf7","block_type":"box","text":"due to general market conditions that are not specifically related to a company or industry, such as real or perceived","page_number":57,"box":{"x":69,"y":536,"width":831,"height":11}},{"id":"fe1dc497-9f29-4d3d-bd8b-488a82062bb2","block_type":"box","text":"adverse economic conditions, changes in the general outlook for corporate earnings, changes in interest or currency","page_number":57,"box":{"x":69,"y":551,"width":829,"height":11}},{"id":"ce5b0a5f-d78c-48ed-b921-4570fb98ffe8","block_type":"box","text":"rates or generally adverse investor sentiment.","page_number":57,"box":{"x":69,"y":566,"width":325,"height":11}},{"id":"9fee6d09-da1f-48ca-ac1a-ad93d633c9d5","block_type":"box","text":"From time to time cer tain of the Funds may invest in shares of companies through initial public offerings","page_number":57,"box":{"x":102,"y":589,"width":745,"height":11}},{"id":"87a09491-90a1-428d-83ee-d4238ab3f6ea","block_type":"box","text":"(“IPOs”). IPOs have the potential to produce, and have in fact produced, substantial gains for cer tain Funds. There is","page_number":57,"box":{"x":69,"y":604,"width":833,"height":11}},{"id":"58991e22-e900-488c-875b-c46fa314a4ce","block_type":"box","text":"no assurance that any Fund will have continued access to profitable IPOs and therefore investors should not rely on","page_number":57,"box":{"x":69,"y":619,"width":824,"height":11}},{"id":"3ae37212-39ff-465e-85e9-95a23eb4b7f0","block_type":"box","text":"these past gains as an indication of future per formance. The investment per formance of a Fund during periods when","page_number":57,"box":{"x":68,"y":634,"width":834,"height":12}},{"id":"e9e27462-e516-45d6-80be-7850c58c5aba","block_type":"box","text":"it is unable to invest significantly or at all in IPOs may be lower than during periods when it is able to do so. In","page_number":57,"box":{"x":70,"y":649,"width":782,"height":12}},{"id":"d7539660-1a43-4f9e-8be6-957059b34356","block_type":"box","text":"addition, as a Fund increases in size, the impact of IPOs on its per formance will generally decrease. Securities","page_number":57,"box":{"x":69,"y":664,"width":790,"height":12}},{"id":"b2621f81-1bf5-4f1e-a258-4170a4c3828e","block_type":"box","text":"issued in IPOs are subject to many of the same risks as investing in companies with smaller market capitalizations.","page_number":57,"box":{"x":70,"y":680,"width":823,"height":11}},{"id":"c9e55eba-8121-44d5-87da-3bca96d4508f","block_type":"box","text":"Securities issued in IPOs have no trading history, and information about the companies may be available for very","page_number":57,"box":{"x":69,"y":695,"width":805,"height":11}},{"id":"7490cfcd-b8a9-47b0-9f08-9e0512cf132f","block_type":"box","text":"limited periods. In addition, the prices of securities sold in IPOs may be highly volatile or may decline shor tly after the","page_number":57,"box":{"x":70,"y":710,"width":836,"height":11}},{"id":"12acd4b8-1e7b-4424-8392-f9a96016d666","block_type":"box","text":"initial public offering.","page_number":57,"box":{"x":70,"y":725,"width":147,"height":11}},{"id":"dbc55fa9-e179-478f-804a-5dada5a0c6af","block_type":"box","text":"The Funds may invest in companies that have relatively small market capitalizations. These organizations will","page_number":57,"box":{"x":101,"y":748,"width":777,"height":11}},{"id":"91d85524-fbd4-451e-a83b-95ad5e584df4","block_type":"box","text":"normally have more limited product lines, markets and financial resources and will be dependent upon a more limited","page_number":57,"box":{"x":69,"y":763,"width":838,"height":11}},{"id":"452b3a20-0da8-4d55-8c20-eae521c372a2","block_type":"box","text":"management group than larger capitalized companies. In addition, it is more difficult to get information on smaller","page_number":57,"box":{"x":69,"y":778,"width":815,"height":11}},{"id":"4fefa104-0246-4088-999a-f1636b59539f","block_type":"box","text":"companies, which tend to be less well known, have shor ter operating histories, do not have significant ownership by","page_number":57,"box":{"x":69,"y":793,"width":829,"height":11}},{"id":"d307dcab-fff6-4e0a-8e24-fde62104bee4","block_type":"box","text":"large investors and are followed by relatively few securities analysts. The securities of smaller capitalized companies","page_number":57,"box":{"x":70,"y":808,"width":831,"height":11}},{"id":"58754dbb-5a90-4ff2-8e64-e96bb1252f61","block_type":"box","text":"are often traded in the OTC markets and may have fewer market makers and wider price spreads. This may result in","page_number":57,"box":{"x":69,"y":823,"width":826,"height":11}},{"id":"ad3fcdd9-fa6a-42f5-9084-040de8694922","block_type":"box","text":"greater price movements and less ability to sell a Fund’s investment than if the Fund held the securities of larger,","page_number":57,"box":{"x":68,"y":838,"width":810,"height":12}},{"id":"25e079d3-27ab-4fb6-9084-4fb89ecdfb68","block_type":"box","text":"more established companies.","page_number":57,"box":{"x":69,"y":854,"width":209,"height":10}},{"id":"e41f2db6-9db2-4d7f-a55d-db51513e8369","block_type":"box","text":"II-26","page_number":57,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"1789d9fa-2e28-41cf-85bd-c13aa053c0b9","block_type":"box","text":"NM1026U-5982568-57/232","page_number":57,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"5fd39188-8d44-4e72-91f3-c3b9ce2150f6","block_type":"box","text":"For a discussion of the types of equity securities in which your Fund may invest and the risks associated with","page_number":58,"box":{"x":102,"y":45,"width":776,"height":11}},{"id":"a78bb8a9-f1e1-45e8-b142-4f1429963b27","block_type":"box","text":"investing in such equity securities, see your Fund’s Prospectus. Cer tain of the Funds may also invest in shares of","page_number":58,"box":{"x":70,"y":60,"width":810,"height":11}},{"id":"cf894a1c-fdc1-4bc5-9101-ce8c23dc4009","block_type":"box","text":"private companies, which are subject to the risks of “Illiquid Investments” and “Restricted Securities” described","page_number":58,"box":{"x":70,"y":75,"width":799,"height":11}},{"id":"7269cd08-ed42-4483-969e-2646ec9cc2c0","block_type":"box","text":"below.","page_number":58,"box":{"x":69,"y":90,"width":43,"height":9}},{"id":"6bc2b1c4-59a5-4581-bd9a-b95ef4c80c25","block_type":"box","text":"Real Estate-Related Securities.","page_number":58,"box":{"x":102,"y":113,"width":219,"height":9}},{"id":"4c7c7da6-7ee9-4210-aa81-65dd5ea60319","block_type":"box","text":"Although no Fund may invest directly in real estate, cer tain Funds may invest in","page_number":58,"box":{"x":327,"y":113,"width":565,"height":11}},{"id":"66ac001b-9937-41f8-a056-0a5772db3d57","block_type":"box","text":"equity securities of issuers that are principally engaged in the real estate industry. Such investments are subject to","page_number":58,"box":{"x":69,"y":128,"width":822,"height":11}},{"id":"9dbc9511-a51f-4835-99f2-b60189a86f1e","block_type":"box","text":"cer tain risks associated with the ownership of real estate and with the real estate industry in general. These risks","page_number":58,"box":{"x":69,"y":143,"width":814,"height":11}},{"id":"b658c7c4-82a0-42fb-a306-da831aa202f9","block_type":"box","text":"include, among others: possible declines in the value of real estate; risks related to general and local economic","page_number":58,"box":{"x":70,"y":158,"width":796,"height":11}},{"id":"d9dd0282-fd0f-47de-afce-b4dfcfd64891","block_type":"box","text":"conditions; possible lack of availability of mor tgage funds or other limitations on access to capital; overbuilding; risks","page_number":58,"box":{"x":69,"y":173,"width":836,"height":11}},{"id":"0298da4e-a2f1-4fa3-bef1-68b9554cde75","block_type":"box","text":"associated with leverage; market illiquidity; extended vacancies of proper ties; increase in competition, proper ty","page_number":58,"box":{"x":69,"y":188,"width":795,"height":12}},{"id":"6b9f24b5-090b-4eab-82de-e37ae3b1fc8e","block_type":"box","text":"taxes, capital expenditures and operating expenses; changes in zoning laws or other governmental regulation; costs","page_number":58,"box":{"x":68,"y":204,"width":828,"height":11}},{"id":"278ce31e-e77b-46d3-8d9c-0a84d501728e","block_type":"box","text":"resulting from the clean-up of, and liability to third par ties for damages resulting from, environmental problems;","page_number":58,"box":{"x":69,"y":218,"width":794,"height":12}},{"id":"67d9cd27-ac0c-4672-a871-39f288672847","block_type":"box","text":"tenant bankruptcies or other credit problems; casualty or condemnation losses; uninsured damages from floods,","page_number":58,"box":{"x":68,"y":234,"width":805,"height":11}},{"id":"cc8357f2-41ef-4f2a-ba2e-3b78ac2fcd77","block_type":"box","text":"ear thquakes or other natural disasters; limitations on and variations in rents, including decreases in market rates for","page_number":58,"box":{"x":69,"y":249,"width":836,"height":11}},{"id":"985424b2-761a-4fac-8d22-f75a5d9d68e9","block_type":"box","text":"rents; investment in developments that are not completed or that are subject to delays in completion; and changes in","page_number":58,"box":{"x":69,"y":264,"width":838,"height":11}},{"id":"68ba47bf-7514-47f4-a8cd-ff5fab83fe3a","block_type":"box","text":"interest rates. To the extent that assets underlying a Fund’s investments are concentrated geographically, by proper ty","page_number":58,"box":{"x":70,"y":279,"width":838,"height":11}},{"id":"b5f7be81-b5e9-42ea-84ee-bacfdb6e0a56","block_type":"box","text":"type or in cer tain other respects, the Fund may be subject to cer tain of the foregoing risks to a greater extent.","page_number":58,"box":{"x":68,"y":294,"width":785,"height":11}},{"id":"c66e7b62-7748-43e1-9caf-d121141dd79a","block_type":"box","text":"Investments by a Fund in securities of companies providing mor tgage servicing will be subject to the risks associated","page_number":58,"box":{"x":70,"y":309,"width":836,"height":11}},{"id":"d1a75f45-2986-4f26-8b87-4d1fd4607428","block_type":"box","text":"with refinancings and their impact on servicing rights.","page_number":58,"box":{"x":68,"y":324,"width":381,"height":12}},{"id":"174cc131-499b-4ed5-a294-7d499724a779","block_type":"box","text":"In addition, if a Fund receives rental income or income from the disposition of real proper ty acquired as a result","page_number":58,"box":{"x":102,"y":347,"width":797,"height":11}},{"id":"0ded0409-505d-491b-bef7-04de85f452d6","block_type":"box","text":"of a default on securities the Fund owns, the receipt of such income may adversely affect the Fund’s ability to retain","page_number":58,"box":{"x":69,"y":362,"width":829,"height":11}},{"id":"a452b129-7baf-4eb9-ad2c-72a13abd9e62","block_type":"box","text":"its tax status as a regulated investment company because of cer tain income source requirements applicable to","page_number":58,"box":{"x":70,"y":377,"width":794,"height":12}},{"id":"7a5b4ddd-d4e4-4553-8bbe-731e282b323c","block_type":"box","text":"regulated investment companies under the Internal Revenue Code of 1986, as amended (the “Code”).","page_number":58,"box":{"x":69,"y":392,"width":730,"height":12}},{"id":"b3c7b30e-eb87-4589-b261-2d8ba88a5baf","block_type":"box","text":"Securities of Smaller or Emerging Growth Companies.","page_number":58,"box":{"x":102,"y":415,"width":381,"height":11}},{"id":"470db3e7-65d5-4b30-8560-6361e582ae39","block_type":"box","text":"Investment in smaller or emerging growth companies","page_number":58,"box":{"x":490,"y":415,"width":376,"height":11}},{"id":"7a6b869e-6e30-45d1-bb18-fa7eb5e8957a","block_type":"box","text":"involves greater risk than is customarily associated with investments in more established companies. The securities","page_number":58,"box":{"x":70,"y":430,"width":828,"height":11}},{"id":"84fde270-a97a-4edf-b2bf-1a90a373a1bb","block_type":"box","text":"of smaller or emerging growth companies may be subject to more abrupt or erratic market movements than larger,","page_number":58,"box":{"x":69,"y":445,"width":815,"height":12}},{"id":"982f603a-2e65-4bd0-8813-33b6220dabfa","block_type":"box","text":"more established companies or the market average in general. These companies may have limited product lines,","page_number":58,"box":{"x":69,"y":461,"width":804,"height":11}},{"id":"fb373b60-d506-40ca-a726-650f10c75c62","block_type":"box","text":"markets or financial resources, or they may be dependent on a limited management group.","page_number":58,"box":{"x":69,"y":475,"width":647,"height":12}},{"id":"550dbe32-bc7e-47c3-b127-a5042b85ec6d","block_type":"box","text":"Investments in smaller or emerging growth companies may involve greater risks and thus may be considered","page_number":58,"box":{"x":102,"y":498,"width":773,"height":11}},{"id":"987243ce-b4f4-44a7-b5ce-38e537e146a0","block_type":"box","text":"speculative. Full development of these companies and trends frequently takes time.","page_number":58,"box":{"x":69,"y":513,"width":597,"height":11}},{"id":"027eaea3-dac5-4894-bff5-f85761d42b3b","block_type":"box","text":"Small cap and emerging growth securities will often be traded only in the OTC market or on a regional securities","page_number":58,"box":{"x":102,"y":536,"width":797,"height":11}},{"id":"9a612b79-051f-445d-9c71-0e7f72929599","block_type":"box","text":"exchange and may not be traded every day or in the volume typical of trading on a national securities exchange. As a","page_number":58,"box":{"x":69,"y":551,"width":832,"height":11}},{"id":"6aa5e19e-485c-417f-9a64-3c32b8d6d69d","block_type":"box","text":"result, the disposition by a Fund of por tfolio securities to meet redemptions or otherwise may require the Fund to","page_number":58,"box":{"x":69,"y":566,"width":808,"height":11}},{"id":"a8772cb1-ff6e-4151-a69d-bb3bfe373b68","block_type":"box","text":"make many small sales over a lengthy period of time, or to sell these securities at a discount from market prices or","page_number":58,"box":{"x":69,"y":581,"width":825,"height":12}},{"id":"93b14195-749b-40da-9ade-18a02c69c1e6","block_type":"box","text":"during periods when, in Fund management’s judgment, such disposition is not desirable.","page_number":58,"box":{"x":69,"y":597,"width":631,"height":11}},{"id":"c7e8f42a-27e1-4a94-bd81-d2d611c86445","block_type":"box","text":"The process of selection and continuous supervision by Fund management does not guarantee successful","page_number":58,"box":{"x":101,"y":619,"width":758,"height":11}},{"id":"222b4fa6-0866-40db-bd25-5b33be7a70a5","block_type":"box","text":"investment results. Careful initial selection is par ticularly impor tant in this area as many new enterprises have","page_number":58,"box":{"x":70,"y":634,"width":787,"height":11}},{"id":"1be51b9f-d1bb-4756-a112-3a45e3651de9","block_type":"box","text":"promise but lack cer tain of the fundamental factors necessary to prosper. Investing in small cap and emerging","page_number":58,"box":{"x":70,"y":649,"width":789,"height":12}},{"id":"6b0e6f76-b662-41f1-b2fa-c67e0120f248","block_type":"box","text":"growth companies requires specialized research and analysis.","page_number":58,"box":{"x":68,"y":665,"width":442,"height":11}},{"id":"e7858d2b-512f-42f5-8c48-e6f6fc886b56","block_type":"box","text":"Fund management believes that relatively small companies may have the oppor tunity to develop into significant","page_number":58,"box":{"x":102,"y":687,"width":795,"height":11}},{"id":"7dc6e2b0-223a-4eec-ad64-319916f15efe","block_type":"box","text":"business enterprises. A Fund may invest in securities of small issuers in the relatively early stages of business","page_number":58,"box":{"x":69,"y":702,"width":791,"height":12}},{"id":"54ffbc8d-52fd-4117-9c87-b20aaff02b62","block_type":"box","text":"development that have a new technology, a unique or proprietary product or service, or a favorable market position.","page_number":58,"box":{"x":69,"y":717,"width":823,"height":12}},{"id":"5ece7530-bacd-4309-9e05-7c3032f6f346","block_type":"box","text":"Equity securities of specific small cap issuers may present different oppor tunities for long-term capital","page_number":58,"box":{"x":102,"y":740,"width":729,"height":11}},{"id":"900fbaed-3037-4a7f-8650-f9ba62bdb88c","block_type":"box","text":"appreciation during varying por tions of economic or securities market cycles, as well as during varying stages of their","page_number":58,"box":{"x":69,"y":755,"width":837,"height":11}},{"id":"9653ab89-6ec0-4baa-88be-89f2c78c3e10","block_type":"box","text":"business development. The market valuation of small cap issuers tends to fluctuate during economic or market","page_number":58,"box":{"x":69,"y":770,"width":794,"height":12}},{"id":"ee8b1588-2434-48f1-ab55-eaa0d135dc42","block_type":"box","text":"cycles.","page_number":58,"box":{"x":69,"y":786,"width":46,"height":11}},{"id":"6e89692e-c967-408d-ad87-9b1fe8342e9b","block_type":"box","text":"Tracking Stocks","page_number":58,"box":{"x":103,"y":808,"width":110,"height":11}},{"id":"839e5382-dfd5-4cb7-8558-fbded99e986f","block_type":"box","text":". A tracking stock is a separate class of common stock whose value is linked to a specific","page_number":58,"box":{"x":214,"y":808,"width":640,"height":11}},{"id":"8539beea-995c-4740-b0c3-6c15ca731eb0","block_type":"box","text":"business unit or operating division within a larger company and is designed to “track” the per formance of such","page_number":58,"box":{"x":69,"y":823,"width":791,"height":12}},{"id":"9019ab97-ac5f-46db-991f-3d13a3357462","block_type":"box","text":"business unit or division. The tracking stock may pay dividends to shareholders independent of the parent company.","page_number":58,"box":{"x":69,"y":838,"width":826,"height":12}},{"id":"2feb3515-36c2-4f61-876b-78cc42acf7ba","block_type":"box","text":"The parent company, rather than the business unit or division, generally is the issuer of tracking stock. However,","page_number":58,"box":{"x":68,"y":853,"width":801,"height":12}},{"id":"e87f2ee5-f3b9-4ffb-b301-a80a32a86e5b","block_type":"box","text":"holders of the tracking stock may not have the same rights as holders of the company’s common stock.","page_number":58,"box":{"x":69,"y":869,"width":740,"height":11}},{"id":"9a0016b6-34b4-46bb-8bbb-c1058a4f2625","block_type":"box","text":"Exchange-Traded Notes (“ETNs”).","page_number":58,"box":{"x":102,"y":891,"width":245,"height":11}},{"id":"8a2cda56-afbd-4afe-890c-14bee179488c","block_type":"box","text":"Cer tain Funds may invest in ETNs. ETNs are generally notes representing","page_number":58,"box":{"x":354,"y":891,"width":521,"height":12}},{"id":"f94c56b6-def0-4fd8-b454-12d0ac497bc8","block_type":"box","text":"debt of the issuer, usually a financial institution. ETNs combine aspects of both bonds and ETFs. An ETN’s returns","page_number":58,"box":{"x":69,"y":906,"width":814,"height":12}},{"id":"ba3ffce0-445b-4b55-8c4c-4f796ce00b2d","block_type":"box","text":"II-27","page_number":58,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"b6a5685a-d759-453b-9a77-ef7513affcf6","block_type":"box","text":"NM1026U-5982568-58/232","page_number":58,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"88af7993-5341-4506-8185-b6182d09e095","block_type":"box","text":"are based on the per formance of one or more underlying assets, reference rates or indexes, minus fees and","page_number":59,"box":{"x":69,"y":45,"width":774,"height":11}},{"id":"330f9cc3-4b40-4282-b373-fe825078fea9","block_type":"box","text":"expenses. Similar to ETFs, ETNs are listed on an exchange and traded in the secondary market. However, unlike an","page_number":59,"box":{"x":69,"y":60,"width":822,"height":11}},{"id":"3db54d2c-23a3-4fc8-bed7-f493a03eb00b","block_type":"box","text":"ETF, an ETN can be held until the ETN’s maturity, at which time the issuer will pay a return linked to the per formance","page_number":59,"box":{"x":70,"y":75,"width":831,"height":11}},{"id":"a3041209-be4f-4a83-8842-f9ed747894a7","block_type":"box","text":"of the specific asset, index or rate (“reference instrument”) to which the ETN is linked minus cer tain fees. Unlike","page_number":59,"box":{"x":69,"y":90,"width":805,"height":11}},{"id":"e5aaa870-c5f0-4a2a-9019-27acd478fad9","block_type":"box","text":"regular bonds, ETNs do not make periodic interest payments, and principal is not protected.","page_number":59,"box":{"x":69,"y":105,"width":654,"height":11}},{"id":"822243c0-52e8-4d06-ac7b-f359b8b6b166","block_type":"box","text":"The value of an ETN may be influenced by, among other things, time to maturity, level of supply and demand for","page_number":59,"box":{"x":101,"y":128,"width":794,"height":11}},{"id":"166b7363-e980-4b7e-aa7c-ec09acfa29bb","block_type":"box","text":"the ETN, volatility and lack of liquidity in underlying markets, changes in the applicable interest rates, the","page_number":59,"box":{"x":68,"y":143,"width":748,"height":11}},{"id":"94715f11-8e7f-4b43-937e-3d5e15237bb1","block_type":"box","text":"per formance of the reference instrument, changes in the issuer’s credit rating and economic, legal, political or","page_number":59,"box":{"x":70,"y":158,"width":789,"height":11}},{"id":"a7dd534f-3e30-4f6c-b12e-5d9f0a08326f","block_type":"box","text":"geographic events that affect the reference instrument. ETNs are subject to credit risk and the value of the ETN may","page_number":59,"box":{"x":68,"y":173,"width":831,"height":11}},{"id":"f0257cbf-87b2-45e9-a62b-707bb15cf5e5","block_type":"box","text":"drop due to a downgrade in an issuer’s credit rating, despite the underlying reference instrument remaining","page_number":59,"box":{"x":69,"y":188,"width":766,"height":12}},{"id":"79ad74a0-3954-4902-ae22-40df91616194","block_type":"box","text":"unchanged. When a Fund invests in ETNs, it will bear its propor tionate share of any fees and expenses borne by the","page_number":59,"box":{"x":69,"y":203,"width":828,"height":12}},{"id":"37a6d6d5-57e4-4793-b897-c12bf55f688f","block_type":"box","text":"ETN.","page_number":59,"box":{"x":70,"y":219,"width":30,"height":8}},{"id":"e650af6e-2bd1-4cd2-b488-a49b2d1e2da1","block_type":"box","text":"An ETN that is tied to a reference instrument may not replicate the per formance of the reference instrument.","page_number":59,"box":{"x":101,"y":241,"width":776,"height":11}},{"id":"e60fb4a9-2f1b-4764-9b53-abb7a4c2287d","block_type":"box","text":"ETNs also incur cer tain expenses not incurred by their applicable reference instrument. Some ETNs that use leverage","page_number":59,"box":{"x":70,"y":256,"width":837,"height":12}},{"id":"2fdfb90e-f303-4ee8-b698-528b4d4e4e95","block_type":"box","text":"may, at times, be illiquid and may be difficult to purchase or sell at a fair price. Levered ETNs are subject to the same","page_number":59,"box":{"x":69,"y":271,"width":840,"height":12}},{"id":"425551cc-7176-480b-ba9f-5471c3d32bb8","block_type":"box","text":"risk as other instruments that use leverage in any form. While leverage allows for greater potential return, the","page_number":59,"box":{"x":69,"y":286,"width":781,"height":12}},{"id":"e6f91cb7-2eb3-46d6-9b2b-567faba11f65","block_type":"box","text":"potential for loss is also greater. Finally, additional losses may be incurred if the investment loses value because, in","page_number":59,"box":{"x":70,"y":302,"width":827,"height":11}},{"id":"59a83eae-7ce7-4f44-89b4-c6289d0b7d50","block_type":"box","text":"addition to the money lost on the investment, the loan still needs to be repaid.","page_number":59,"box":{"x":69,"y":317,"width":560,"height":11}},{"id":"d744c070-b142-4d68-8e62-d3922ddb3bb6","block_type":"box","text":"Because the return on the ETN is dependent on the issuer’s ability or willingness to meet its obligations, the","page_number":59,"box":{"x":102,"y":340,"width":774,"height":11}},{"id":"717976b0-d105-446d-9c3b-b9717cf036c5","block_type":"box","text":"value of the ETN may change due to a change in the issuer’s credit rating, despite no change in the underlying","page_number":59,"box":{"x":68,"y":355,"width":788,"height":11}},{"id":"74f9b288-3fee-4fd9-b19c-14f36267bb46","block_type":"box","text":"reference instrument. The market value of ETN shares may differ from the value of the reference instrument. This","page_number":59,"box":{"x":69,"y":370,"width":810,"height":11}},{"id":"e53027d1-ae5e-4067-a560-57a24b803158","block_type":"box","text":"difference in price may be due to the fact that the supply and demand in the market for ETN shares at any point in","page_number":59,"box":{"x":69,"y":385,"width":815,"height":11}},{"id":"99b75702-96fc-42fb-abd9-bec7a4efebec","block_type":"box","text":"time is not always identical to the supply and demand in the market for the assets underlying the reference","page_number":59,"box":{"x":68,"y":400,"width":766,"height":11}},{"id":"93850cdd-9e4d-4d24-9ccd-c93fd0dba27a","block_type":"box","text":"instrument that the ETN seeks to track.","page_number":59,"box":{"x":70,"y":415,"width":279,"height":9}},{"id":"1bf079ff-cae6-470d-ad34-99b2079f9f13","block_type":"box","text":"There may be restrictions on the Fund’s right to redeem its investment in an ETN, which are generally meant to","page_number":59,"box":{"x":101,"y":438,"width":791,"height":11}},{"id":"1a8ece17-cc16-4e2e-8b22-c3c698728013","block_type":"box","text":"be held until maturity. The Fund’s decision to sell its ETN holdings may be limited by the availability of a secondary","page_number":59,"box":{"x":69,"y":453,"width":818,"height":11}},{"id":"b8cc96c0-2c04-4460-a062-7d946a3ab106","block_type":"box","text":"market. An investor in an ETN could lose some or all of the amount invested.","page_number":59,"box":{"x":69,"y":468,"width":547,"height":9}},{"id":"cf6d1789-f5b3-4417-9f53-d7cec29fde47","block_type":"box","text":"ETNs are also subject to tax risks. The Internal Revenue Service (the “IRS”) may not accept, and a cour t may not","page_number":59,"box":{"x":102,"y":491,"width":807,"height":11}},{"id":"740dd3b1-89c3-40e9-b1ab-f7136f6a63ed","block_type":"box","text":"uphold, how the Funds characterize and treat ETNs for tax purposes. The timing and character of income and gains","page_number":59,"box":{"x":69,"y":506,"width":819,"height":11}},{"id":"512477f0-06d1-4f05-b5f0-1999c1c14b09","block_type":"box","text":"derived by a Fund from investments in ETNs may be affected by future legislation.","page_number":59,"box":{"x":69,"y":521,"width":581,"height":11}},{"id":"b03eb6f5-11ea-42df-9df6-d13da32a6139","block_type":"box","text":"Foreign Investments.","page_number":59,"box":{"x":102,"y":544,"width":152,"height":11}},{"id":"342cbc81-e87c-48de-a5b4-4d6d23c8995c","block_type":"box","text":"Foreign Investment Risks.","page_number":59,"box":{"x":102,"y":566,"width":182,"height":11}},{"id":"c30bb43f-18ec-4a23-a98f-86e4441045fb","block_type":"box","text":"Cer tain Funds may invest in foreign securities, including securities from issuers","page_number":59,"box":{"x":291,"y":566,"width":567,"height":11}},{"id":"784ed412-4e4a-482f-b263-634447d8e627","block_type":"box","text":"located in emerging market countries. These securities may be denominated in U.S. dollars or in a foreign currency.","page_number":59,"box":{"x":70,"y":581,"width":822,"height":12}},{"id":"6f593108-1cc1-4a67-bd55-bcf22330da0e","block_type":"box","text":"Investing in foreign securities involves risks not typically associated with investing in securities of companies","page_number":59,"box":{"x":70,"y":596,"width":774,"height":12}},{"id":"cd2ccb23-3d91-4734-ac4e-1763d059006b","block_type":"box","text":"organized and operated in the United States that can increase the chances that a Fund will lose money.","page_number":59,"box":{"x":69,"y":612,"width":738,"height":11}},{"id":"b15fcdbb-db39-4fef-b308-e1323debed40","block_type":"box","text":"Securities issued by cer tain companies organized outside the United States may not be deemed to be foreign","page_number":59,"box":{"x":102,"y":634,"width":782,"height":12}},{"id":"ad499c0f-1834-4e37-844a-97721eddd39d","block_type":"box","text":"securities (but rather deemed to be U.S. securities) if (i) the company’s principal operations are conducted from the","page_number":59,"box":{"x":69,"y":649,"width":824,"height":12}},{"id":"b56dd875-8b23-42c4-8664-dc83be9ddf70","block_type":"box","text":"U.S., (ii) the company’s equity securities trade principally on a U.S. stock exchange, (iii) the company does a","page_number":59,"box":{"x":70,"y":665,"width":771,"height":11}},{"id":"7a6f6dd0-98ff-4228-a791-da3a519da060","block_type":"box","text":"substantial amount of business in the U.S. or (iv) the issuer of securities is included in the Fund’s primary U.S.","page_number":59,"box":{"x":69,"y":680,"width":792,"height":11}},{"id":"eff84f09-a2cc-4c6a-8725-d040fa5c010a","block_type":"box","text":"benchmark index.","page_number":59,"box":{"x":69,"y":695,"width":124,"height":9}},{"id":"62fd083e-eb91-4db5-ba8e-ff69b7dcd49e","block_type":"box","text":"In addition to equity securities, foreign investments of the Funds may include: (a) debt obligations issued or","page_number":59,"box":{"x":102,"y":717,"width":767,"height":12}},{"id":"3e335594-915e-44fa-a726-49e14bb2b96d","block_type":"box","text":"guaranteed by foreign sovereign governments or their agencies, authorities, instrumentalities or political","page_number":59,"box":{"x":68,"y":732,"width":742,"height":12}},{"id":"bfe299e0-0542-412a-8cf5-16f6c5913b38","block_type":"box","text":"subdivisions, including a foreign state, province or municipality; (b) debt obligations of supranational organizations;","page_number":59,"box":{"x":69,"y":748,"width":818,"height":11}},{"id":"73d6bccd-b6b8-4703-8492-aee82fd22165","block_type":"box","text":"(c) debt obligations of foreign banks and bank holding companies; (d) debt obligations of domestic banks and","page_number":59,"box":{"x":69,"y":763,"width":780,"height":11}},{"id":"c1fbefd7-8577-4e28-82bb-52ee8e254ad9","block_type":"box","text":"corporations issued in foreign currencies; (e) debt obligations denominated in the Euro; and (f) foreign corporate debt","page_number":59,"box":{"x":69,"y":778,"width":837,"height":11}},{"id":"f30b353c-567d-4162-b8f6-ec11bd1376dd","block_type":"box","text":"securities and commercial paper. Such securities may include loan par ticipations and assignments, conver tible","page_number":59,"box":{"x":69,"y":793,"width":794,"height":11}},{"id":"15571d11-5e4c-4dd3-85a2-6ab8c6b218b6","block_type":"box","text":"securities and zero-coupon securities.","page_number":59,"box":{"x":69,"y":808,"width":268,"height":11}},{"id":"5db7089a-3187-4ded-8611-3641475cd484","block_type":"box","text":"Dividends or interest on, or proceeds from the sale of, foreign securities may be subject to foreign withholding","page_number":59,"box":{"x":102,"y":831,"width":785,"height":11}},{"id":"a56d4e96-7cd2-4a19-86c5-c82236c06a1b","block_type":"box","text":"taxes.","page_number":59,"box":{"x":68,"y":847,"width":42,"height":8}},{"id":"86c85020-0b14-4b5c-821c-55ba0af565e7","block_type":"box","text":"To the extent that the underlying securities or other instruments held by a Fund trade on foreign exchanges or in","page_number":59,"box":{"x":101,"y":869,"width":798,"height":11}},{"id":"e8a2775f-18f3-4b07-8f34-8256818aff29","block_type":"box","text":"foreign markets that are closed when the securities exchange on which the Fund’s shares trade is open, there are","page_number":59,"box":{"x":68,"y":884,"width":815,"height":11}},{"id":"91315076-21ec-4be8-ba5a-02bbd887d7f5","block_type":"box","text":"likely to be deviations between the current price of such an underlying security and the last quoted price for the","page_number":59,"box":{"x":70,"y":899,"width":792,"height":11}},{"id":"889f7f8a-82c3-41bc-9bf5-372bab4e72a5","block_type":"box","text":"II-28","page_number":59,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"8116e816-7bd9-4ff4-9021-32bcedfb3495","block_type":"box","text":"NM1026U-5982568-59/232","page_number":59,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"70fa6f31-e58d-4171-a26e-32418fad054f","block_type":"box","text":"underlying security (","page_number":60,"box":{"x":69,"y":45,"width":140,"height":11}},{"id":"3b8ffbb6-75f2-407d-9306-e65317affcf4","block_type":"box","text":"i.e.","page_number":60,"box":{"x":211,"y":45,"width":20,"height":9}},{"id":"d6dc83a9-4458-47db-8e48-913690ec7138","block_type":"box","text":", the Fund’s quote from the closed foreign market). The impact of a closed foreign market on a","page_number":60,"box":{"x":234,"y":45,"width":675,"height":11}},{"id":"1b7dcbb7-8407-450d-a7d7-969b6593a999","block_type":"box","text":"Fund is likely to be greater where a large por tion of the Fund’s underlying securities or other instruments trade on","page_number":60,"box":{"x":70,"y":60,"width":809,"height":11}},{"id":"9be6426c-7bef-4031-9d3c-acb17736a29a","block_type":"box","text":"that closed foreign market or when the foreign market is closed for unscheduled reasons. These deviations may","page_number":60,"box":{"x":68,"y":75,"width":800,"height":11}},{"id":"e5a688b4-f996-4ac5-b3f1-712f52ab0069","block_type":"box","text":"result in premiums or discounts to cer tain Funds’ NAVs that may be greater than those experienced by other ETFs.","page_number":60,"box":{"x":69,"y":90,"width":815,"height":11}},{"id":"43ea5c10-03ca-4dc7-8cec-aeb55dfee4c5","block_type":"box","text":"Foreign Market Risk.","page_number":60,"box":{"x":102,"y":113,"width":144,"height":11}},{"id":"d077daaf-691c-4900-a0f6-eb2abdc5b74b","block_type":"box","text":"Funds that may invest in foreign securities offer the potential for more diversification than a","page_number":60,"box":{"x":254,"y":113,"width":652,"height":11}},{"id":"2c29acfa-e05d-446d-adec-a8c34fac93c1","block_type":"box","text":"Fund that invests only in the United States because securities traded on foreign markets have often (though not","page_number":60,"box":{"x":70,"y":128,"width":797,"height":11}},{"id":"85969208-6d40-4e76-a818-dc678b329ce2","block_type":"box","text":"always) per formed differently from securities traded in the United States. However, such investments often involve","page_number":60,"box":{"x":69,"y":143,"width":817,"height":11}},{"id":"2e4337da-d0a7-404e-a000-171b60eb220c","block_type":"box","text":"risks not present in U.S. investments that can increase the chances that a Fund will lose money. In par ticular, a Fund","page_number":60,"box":{"x":69,"y":158,"width":836,"height":11}},{"id":"4069c26f-e89f-4b6e-9e4a-a76753b64a51","block_type":"box","text":"is subject to the risk that, because there are generally fewer investors on foreign exchanges and a smaller number of","page_number":60,"box":{"x":70,"y":173,"width":835,"height":11}},{"id":"13263f3b-e434-4692-967b-773afc774541","block_type":"box","text":"shares traded each day, it may be difficult for the Fund to buy and sell securities on those exchanges. In addition,","page_number":60,"box":{"x":69,"y":188,"width":810,"height":12}},{"id":"3043f24b-f0af-4025-858e-8e14f299cc0b","block_type":"box","text":"prices of foreign securities may fluctuate more than prices of securities traded in the United States. Investments in","page_number":60,"box":{"x":70,"y":203,"width":820,"height":12}},{"id":"77074ea7-4eca-4265-aa5e-94c23df03510","block_type":"box","text":"foreign markets may also be adversely affected by governmental actions such as the imposition of punitive taxes or","page_number":60,"box":{"x":68,"y":218,"width":826,"height":12}},{"id":"c14394a9-7d31-4106-a470-e7890e960199","block_type":"box","text":"tariffs. In addition, economic conditions, such as volatile currency exchange rates and interest rates, political events,","page_number":60,"box":{"x":68,"y":234,"width":836,"height":11}},{"id":"9eaad6e3-af89-4439-923e-dd139fcea397","block_type":"box","text":"military action and other conditions may, without prior warning, lead to the governments of cer tain countries, or the","page_number":60,"box":{"x":69,"y":249,"width":821,"height":11}},{"id":"ca6be67a-ff7f-444d-a035-6357b703b22d","block_type":"box","text":"U.S. Government with respect to cer tain countries, prohibiting or imposing substantial restrictions through capital","page_number":60,"box":{"x":70,"y":264,"width":807,"height":11}},{"id":"1fdbf32f-8518-4e6e-92d7-a457077e94b0","block_type":"box","text":"controls and/or sanctions on foreign investing in the capital markets or cer tain industries in those countries. Capital","page_number":60,"box":{"x":69,"y":279,"width":830,"height":11}},{"id":"4bb25637-7b3a-4216-95eb-cb3c5931c593","block_type":"box","text":"controls and/or sanctions may include the prohibition of, or restrictions on, the ability to own or transfer currency,","page_number":60,"box":{"x":69,"y":294,"width":810,"height":11}},{"id":"c30890fe-2a54-44a7-adf4-0dd314c95499","block_type":"box","text":"securities, derivatives or other assets and may also include retaliatory actions of one government against another","page_number":60,"box":{"x":69,"y":309,"width":813,"height":11}},{"id":"0508c63e-7a5f-4547-8f9f-145dd1fe2b1b","block_type":"box","text":"government, such as seizure of assets. Any of these actions could severely impair a Fund’s ability to purchase, sell,","page_number":60,"box":{"x":68,"y":324,"width":828,"height":12}},{"id":"5f4dc332-e9c7-48b2-a8e0-dea6a725b56b","block_type":"box","text":"transfer, receive, deliver or otherwise obtain exposure to foreign securities and assets, including the ability to","page_number":60,"box":{"x":68,"y":339,"width":782,"height":12}},{"id":"3b8821ff-52af-4444-9663-881ef9336ce9","block_type":"box","text":"transfer the Fund’s assets or income back into the United States, and could negatively impact the value and/or","page_number":60,"box":{"x":68,"y":355,"width":796,"height":11}},{"id":"0d27c815-1fbb-4b22-a5fc-4fd57a2ef74a","block_type":"box","text":"liquidity of such assets or otherwise adversely affect a Fund’s operations, causing the Fund to decline in value. Other","page_number":60,"box":{"x":70,"y":370,"width":837,"height":11}},{"id":"de16dd82-e81a-45e5-aad7-c8b5479963a5","block_type":"box","text":"potential foreign market risks include exchange controls, difficulties in pricing securities, defaults on foreign","page_number":60,"box":{"x":70,"y":385,"width":768,"height":11}},{"id":"e982539a-f68c-453b-9c1e-42a3002cbd1b","block_type":"box","text":"government securities, difficulties in enforcing favorable legal judgments in foreign cour ts, and political and social","page_number":60,"box":{"x":68,"y":400,"width":813,"height":11}},{"id":"c40e3e6a-782c-46ba-8205-2a9dcbab9c79","block_type":"box","text":"conditions, such as diplomatic relations, confiscatory taxation, expropriation, limitation on the removal of funds or","page_number":60,"box":{"x":69,"y":415,"width":814,"height":11}},{"id":"a61fbc9e-b69b-47e6-bb48-b8dc98c4589c","block_type":"box","text":"assets, or imposition of (or change in) exchange control regulations. Legal remedies available to investors in cer tain","page_number":60,"box":{"x":69,"y":430,"width":828,"height":11}},{"id":"82565dab-613c-4342-bd4c-9e8eb82e63f3","block_type":"box","text":"foreign countries may be less extensive than those available to investors in the United States or other foreign","page_number":60,"box":{"x":68,"y":445,"width":782,"height":12}},{"id":"73827fe7-165f-4bb4-aaa9-8d21951d03d0","block_type":"box","text":"countries. In addition, changes in government administrations or economic or monetary policies in the United States","page_number":60,"box":{"x":69,"y":460,"width":830,"height":12}},{"id":"7a0820a0-8e8d-4dc2-93ce-23177b8e2ca8","block_type":"box","text":"or abroad could result in appreciation or depreciation of por tfolio securities and could favorably or adversely affect a","page_number":60,"box":{"x":69,"y":475,"width":829,"height":12}},{"id":"c3e91fca-deb5-4382-b1d9-bffc268c0bfe","block_type":"box","text":"Fund’s operations.","page_number":60,"box":{"x":70,"y":491,"width":130,"height":11}},{"id":"90c43d13-96e8-4d02-8ebb-de68c2f4c850","block_type":"box","text":"Foreign Economy Risk.","page_number":60,"box":{"x":102,"y":514,"width":158,"height":11}},{"id":"4f5c5eea-0ff2-4885-b1c0-a2254a575096","block_type":"box","text":"The economies of cer tain foreign markets often do not compare favorably with that of the","page_number":60,"box":{"x":267,"y":513,"width":636,"height":12}},{"id":"fc2c24e1-c62d-4c3e-a602-7eef868efbcb","block_type":"box","text":"United States with respect to such issues as growth of gross national product, reinvestment of capital, resources,","page_number":60,"box":{"x":70,"y":528,"width":812,"height":12}},{"id":"f21bb026-40c5-4252-8465-d7f6338092fd","block_type":"box","text":"and balance of payments position. Cer tain such economies may rely heavily on par ticular industries or foreign capital","page_number":60,"box":{"x":69,"y":543,"width":835,"height":12}},{"id":"23fad0c7-5026-401d-9ce1-ffd82a500de7","block_type":"box","text":"and are more vulnerable to diplomatic developments, the imposition of economic sanctions against a par ticular","page_number":60,"box":{"x":69,"y":559,"width":795,"height":11}},{"id":"eb08fc12-8aae-45b7-9c0a-8dbcdae3dca0","block_type":"box","text":"country or countries, changes in international trading patterns, trade barriers, and other protectionist or retaliatory","page_number":60,"box":{"x":69,"y":574,"width":817,"height":11}},{"id":"2918ab8e-47c3-4ff7-9524-b470653e6c7b","block_type":"box","text":"measures.","page_number":60,"box":{"x":69,"y":591,"width":74,"height":7}},{"id":"5866fffe-dea0-4f65-a038-b93f9ada5918","block_type":"box","text":"Currency Risk and Exchange Risk.","page_number":60,"box":{"x":102,"y":612,"width":240,"height":11}},{"id":"e13ef3e2-82da-4922-9e0d-8f1459bc9b9c","block_type":"box","text":"Because foreign securities generally are denominated and pay dividends or","page_number":60,"box":{"x":349,"y":612,"width":534,"height":11}},{"id":"02afef28-d443-4f36-b2cb-3fd2e3198a1c","block_type":"box","text":"interest in foreign currencies, the value of a Fund that invests in foreign securities as measured in U.S. dollars will be","page_number":60,"box":{"x":70,"y":627,"width":838,"height":11}},{"id":"1945ada3-295a-488a-a538-e064f8b99cf4","block_type":"box","text":"affected favorably or unfavorably by changes in exchange rates. Generally, when the U.S. dollar rises in value against","page_number":60,"box":{"x":69,"y":642,"width":833,"height":11}},{"id":"33111a96-dd26-4b7f-a48c-7001208c0657","block_type":"box","text":"a foreign currency, a security denominated in that currency loses value because the currency is wor th fewer U.S.","page_number":60,"box":{"x":69,"y":657,"width":801,"height":11}},{"id":"54df75ba-fbf0-4b1c-8db3-d2303ff01cd0","block_type":"box","text":"dollars. Conversely, when the U.S. dollar decreases in value against a foreign currency, a security denominated in","page_number":60,"box":{"x":69,"y":672,"width":808,"height":11}},{"id":"20f4489d-237f-4822-a260-609db901e138","block_type":"box","text":"that currency gains value because the currency is wor th more U.S. dollars. This risk, generally known as “currency","page_number":60,"box":{"x":68,"y":687,"width":816,"height":11}},{"id":"7ed17b65-eb74-4873-9db9-739503c5ff4c","block_type":"box","text":"risk,” means that a stronger U.S. dollar will reduce returns for U.S. investors while a weak U.S. dollar will increase","page_number":60,"box":{"x":69,"y":702,"width":814,"height":12}},{"id":"be088760-83f6-4463-9bbc-5927e6595eff","block_type":"box","text":"those returns. Currency exchange rates can also be affected unpredictably by intervention by U.S. or foreign","page_number":60,"box":{"x":68,"y":717,"width":771,"height":12}},{"id":"7cb5ae74-da7a-4b70-9399-abcbc0594b41","block_type":"box","text":"governments or central banks, or the failure to intervene, or buy currency controls or political developments in the","page_number":60,"box":{"x":68,"y":732,"width":813,"height":12}},{"id":"ea7898e6-7858-4e7a-8e8a-ce400d19722b","block_type":"box","text":"United States or abroad.","page_number":60,"box":{"x":70,"y":748,"width":172,"height":9}},{"id":"c5091ddd-71d9-44d1-83b4-7eb551ff16c4","block_type":"box","text":"Governmental Supervision and Regulation/Accounting Standards.","page_number":60,"box":{"x":102,"y":770,"width":466,"height":12}},{"id":"70450ea4-3591-4d37-a9dd-4de3b76c49c5","block_type":"box","text":"Many foreign governments supervise and","page_number":60,"box":{"x":575,"y":770,"width":293,"height":12}},{"id":"2661be63-8eed-4802-b69b-07b8b00cd917","block_type":"box","text":"regulate stock exchanges, brokers and the sale of securities less than does the United States. Some countries may","page_number":60,"box":{"x":69,"y":785,"width":828,"height":12}},{"id":"ce6b68b6-8149-4a45-9e22-3433ad67a30d","block_type":"box","text":"not have laws to protect investors comparable to the U.S. securities laws. For example, some foreign countries may","page_number":60,"box":{"x":69,"y":801,"width":826,"height":11}},{"id":"a82d10ef-94f4-4d69-a115-585c1e6622a5","block_type":"box","text":"have no laws or rules against insider trading. Insider trading occurs when a person buys or sells a company’s","page_number":60,"box":{"x":69,"y":816,"width":778,"height":11}},{"id":"5dd1f32a-77f7-4d1d-a477-d6cc146be6cb","block_type":"box","text":"securities based on nonpublic information about that company. Accounting standards in other countries are not","page_number":60,"box":{"x":69,"y":831,"width":794,"height":11}},{"id":"52a3c391-7875-4646-a61e-79cd7ffc441e","block_type":"box","text":"necessarily the same as in the United States. If the accounting standards in another country do not require as much","page_number":60,"box":{"x":69,"y":846,"width":831,"height":11}},{"id":"a8acb5da-1214-45f9-8c28-a60f3db0d3d9","block_type":"box","text":"detail as U.S. accounting standards, it may be harder for Fund management to completely and accurately determine a","page_number":60,"box":{"x":69,"y":861,"width":840,"height":11}},{"id":"0163aa46-2342-455d-900a-8623542de33c","block_type":"box","text":"company’s financial condition. In addition, the U.S. Government has from time to time in the past imposed","page_number":60,"box":{"x":69,"y":876,"width":760,"height":11}},{"id":"15f87fce-d59d-4d62-bad3-d4bbf1eab73d","block_type":"box","text":"restrictions, through penalties and otherwise, on foreign investments by U.S. investors such as the Fund. If such","page_number":60,"box":{"x":69,"y":891,"width":803,"height":12}},{"id":"468a2df3-fa5d-479d-b7a9-b802b36eb0d5","block_type":"box","text":"restrictions should be reinstituted, it might become necessary for the Fund to invest all or substantially all of its","page_number":60,"box":{"x":69,"y":906,"width":798,"height":12}},{"id":"61e608d7-d1b8-4f35-8ef5-dd808ac6c41f","block_type":"box","text":"II-29","page_number":60,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"9ece01da-421e-44b9-a0ef-c016fce9dbaa","block_type":"box","text":"NM1026U-5982568-60/232","page_number":60,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"82bc1817-82c4-4690-87ca-f05cdf5d0c5c","block_type":"box","text":"assets in U.S. securities. Also, brokerage commissions and other costs of buying or selling securities often are","page_number":61,"box":{"x":69,"y":45,"width":793,"height":11}},{"id":"57b91cbe-430f-49c1-821f-607333b0098e","block_type":"box","text":"higher in foreign countries than they are in the United States. This reduces the amount the Fund can earn on its","page_number":61,"box":{"x":69,"y":60,"width":797,"height":11}},{"id":"aa618a76-7a7e-4906-999a-4052d15563c6","block_type":"box","text":"investments.","page_number":61,"box":{"x":70,"y":75,"width":89,"height":9}},{"id":"dbfe6d42-71fe-4d9e-a4ec-992e1ad9da9f","block_type":"box","text":"Cer tain Risks of Holding Fund Assets Outside the United States.","page_number":61,"box":{"x":102,"y":98,"width":458,"height":11}},{"id":"962c6a58-9052-4f66-82b9-d5063410eb98","block_type":"box","text":"A Fund generally holds its foreign securities and","page_number":61,"box":{"x":566,"y":98,"width":341,"height":11}},{"id":"5e4a10c6-d131-4506-a6c0-244aec6e64f3","block_type":"box","text":"cash in foreign banks and securities depositories. Some foreign banks and securities depositories may be recently","page_number":61,"box":{"x":69,"y":113,"width":819,"height":11}},{"id":"af38e0fc-80d7-45cf-8f6d-2ec25cab3095","block_type":"box","text":"organized or new to the foreign custody business. In addition, there may be limited or no regulatory oversight over","page_number":61,"box":{"x":69,"y":128,"width":813,"height":11}},{"id":"fbcc5cdf-b520-47a3-989e-8f8553425248","block_type":"box","text":"their operations. Also, the laws of cer tain countries may put limits on a Fund’s ability to recover its assets if a foreign","page_number":61,"box":{"x":68,"y":143,"width":838,"height":11}},{"id":"d14da580-21be-4e6f-84c9-dd78ac4987ac","block_type":"box","text":"bank or depository or issuer of a security or any of their agents goes bankrupt. In addition, it is often more expensive","page_number":61,"box":{"x":69,"y":158,"width":835,"height":11}},{"id":"45a24615-ce64-4a55-9c9b-8e679fdfc08d","block_type":"box","text":"for a Fund to buy, sell and hold securities in cer tain foreign markets than in the United States. The increased","page_number":61,"box":{"x":68,"y":173,"width":777,"height":11}},{"id":"99e973bc-d6dd-4a64-b71e-899536115996","block_type":"box","text":"expense of investing in foreign markets reduces the amount a Fund can earn on its investments and typically results","page_number":61,"box":{"x":69,"y":188,"width":831,"height":12}},{"id":"dc29f7f0-1dbf-48ea-8b39-e9863252d455","block_type":"box","text":"in a higher operating expense ratio for the Fund as compared to investment companies that invest only in the United","page_number":61,"box":{"x":70,"y":203,"width":828,"height":12}},{"id":"7b142177-dd66-4ce3-9a0a-f827f5f7d6f5","block_type":"box","text":"States.","page_number":61,"box":{"x":69,"y":219,"width":49,"height":8}},{"id":"ba6f0429-88f9-4c25-b755-735145520326","block_type":"box","text":"Publicly Available Information.","page_number":61,"box":{"x":102,"y":241,"width":210,"height":11}},{"id":"8b2c6e4e-438a-41a5-8e6d-55509721b837","block_type":"box","text":"In general, less information is publicly available with respect to foreign issuers","page_number":61,"box":{"x":319,"y":241,"width":558,"height":11}},{"id":"aee0d81e-86e8-402b-b0cf-5cac2edbf844","block_type":"box","text":"than is available with respect to U.S. companies. Most foreign companies are also not subject to the uniform","page_number":61,"box":{"x":68,"y":256,"width":779,"height":12}},{"id":"0fed85ef-f472-4c3d-82ec-fe6d9c788665","block_type":"box","text":"accounting and financial repor ting requirements applicable to issuers in the United States. While the volume of","page_number":61,"box":{"x":69,"y":271,"width":793,"height":12}},{"id":"9e41a798-2189-44e1-8df6-36286aa68cee","block_type":"box","text":"transactions effected on foreign stock exchanges has increased in recent years, it remains appreciably below that of","page_number":61,"box":{"x":68,"y":286,"width":834,"height":12}},{"id":"df1ae0b2-6ce9-4e7a-8b93-c7d67a0f576b","block_type":"box","text":"the New York Stock Exchange. Accordingly, a Fund’s foreign investments may be less liquid than, and their prices may","page_number":61,"box":{"x":68,"y":302,"width":841,"height":11}},{"id":"ec19fb70-c691-414e-81bd-73e6ff32fe4f","block_type":"box","text":"be more volatile than, comparable investments in securities in U.S. companies. In addition, there is generally less","page_number":61,"box":{"x":69,"y":317,"width":813,"height":11}},{"id":"fa5952cc-86ea-4141-847c-ef59f60c2769","block_type":"box","text":"government supervision and regulation of securities exchanges, brokers and issuers in foreign countries than in the","page_number":61,"box":{"x":68,"y":332,"width":827,"height":11}},{"id":"80bfdb17-f0f6-4d89-a1a5-6a097e57bbf3","block_type":"box","text":"United States.","page_number":61,"box":{"x":70,"y":347,"width":99,"height":9}},{"id":"0aad088e-ae5b-4aac-903d-9d706d611fd9","block_type":"box","text":"Settlement Risk.","page_number":61,"box":{"x":102,"y":370,"width":116,"height":9}},{"id":"75a8d49a-3bd7-49f6-bcee-9cd0fe987280","block_type":"box","text":"Settlement and clearance procedures in cer tain foreign markets differ significantly from those","page_number":61,"box":{"x":225,"y":370,"width":669,"height":11}},{"id":"054f3339-c1de-49d2-a0c6-79ac3365eeb5","block_type":"box","text":"in the United States. Supervisory authorities may also be unable to apply standards which are comparable with those","page_number":61,"box":{"x":70,"y":385,"width":837,"height":11}},{"id":"8710e2e2-ce14-4a9b-83e7-27d16a3d91f9","block_type":"box","text":"in the United States. Foreign settlement procedures and trade regulations also may involve cer tain risks (such as","page_number":61,"box":{"x":70,"y":400,"width":808,"height":11}},{"id":"21a3a41c-b36b-40e5-a0b1-00f67ba4b170","block_type":"box","text":"delays in payment for or delivery of securities) not typically generated by the settlement of U.S. investments.","page_number":61,"box":{"x":69,"y":415,"width":772,"height":11}},{"id":"dfe4dbaa-e1d9-4c22-8cde-2b5adccd8904","block_type":"box","text":"Communications between the United States and emerging market countries may be unreliable, increasing the","page_number":61,"box":{"x":102,"y":438,"width":781,"height":11}},{"id":"7efcedd3-37dd-49ac-9459-565eb7f91542","block_type":"box","text":"risk of delayed settlements or losses of security cer tificates in markets that still rely on physical settlement.","page_number":61,"box":{"x":69,"y":453,"width":771,"height":11}},{"id":"e66b4f06-ad42-4dce-9f85-6059138aa792","block_type":"box","text":"Settlements in cer tain foreign countries at times have not kept pace with the number of securities transactions;","page_number":61,"box":{"x":69,"y":468,"width":797,"height":11}},{"id":"a89548ff-a835-43d1-8b8f-0d5e145cb982","block_type":"box","text":"these problems may make it difficult for a Fund to carry out transactions. If a Fund cannot settle or is delayed in","page_number":61,"box":{"x":68,"y":483,"width":802,"height":11}},{"id":"1f7c25ae-2865-46c6-b177-7a655636a5eb","block_type":"box","text":"settling a purchase of securities, it may miss attractive investment oppor tunities and cer tain of its assets may be","page_number":61,"box":{"x":69,"y":498,"width":812,"height":11}},{"id":"0e4bb646-57a6-415a-a5ab-a79650eed6bb","block_type":"box","text":"uninvested with no return earned thereon for some period. If a Fund cannot settle or is delayed in settling a sale of","page_number":61,"box":{"x":69,"y":513,"width":821,"height":12}},{"id":"e912ef8e-957c-4afb-96d5-279109c844e1","block_type":"box","text":"securities, it may lose money if the value of the security then declines or, if it has contracted to sell the security to","page_number":61,"box":{"x":69,"y":528,"width":816,"height":12}},{"id":"52ac25ed-61d6-4487-b9e8-dc6624e82ad1","block_type":"box","text":"another par ty, the Fund could be liable to that par ty for any losses incurred.","page_number":61,"box":{"x":69,"y":543,"width":539,"height":12}},{"id":"e4a59f20-9eb7-4c21-8638-6da9a14fb8d7","block_type":"box","text":"Because of uncer tainties in the operation of settlement systems in individual markets, competing claims may","page_number":61,"box":{"x":102,"y":566,"width":781,"height":11}},{"id":"1d5e08e1-f226-4e05-a7e2-09a6892380d1","block_type":"box","text":"arise in respect of securities held by or to be transferred to a Fund. Compensation schemes may not exist or may","page_number":61,"box":{"x":69,"y":581,"width":810,"height":11}},{"id":"236f8e2a-fb7c-4427-b642-c531d3138f0c","block_type":"box","text":"otherwise be limited or inadequate to meet the Fund’s claims in case of such event.","page_number":61,"box":{"x":69,"y":596,"width":601,"height":11}},{"id":"7be4f3cb-8f85-4ae7-bd20-1141270f1f62","block_type":"box","text":"Sovereign Debt.","page_number":61,"box":{"x":102,"y":619,"width":111,"height":11}},{"id":"8ef12d6b-afbd-4e8d-9e3e-e569e405e734","block_type":"box","text":"Investment in sovereign debt can involve a high degree of risk. The governmental entity that","page_number":61,"box":{"x":221,"y":619,"width":653,"height":11}},{"id":"14f13b65-6c6f-46aa-96b7-ae9b3733e0ce","block_type":"box","text":"controls the repayment of sovereign debt may not be able or willing to repay the principal and/or interest when due in","page_number":61,"box":{"x":69,"y":634,"width":837,"height":12}},{"id":"76ce3034-d059-4ad7-a7d0-fba767d2edfe","block_type":"box","text":"accordance with the terms of such debt. A governmental entity’s willingness or ability to repay principal and interest","page_number":61,"box":{"x":69,"y":649,"width":826,"height":12}},{"id":"b15bae02-79ef-472f-b71d-a6553943d456","block_type":"box","text":"due in a timely manner may be affected by, among other factors, its cash flow situation, the extent of its foreign","page_number":61,"box":{"x":69,"y":664,"width":798,"height":12}},{"id":"b846dd3a-7bea-4e28-a7e7-48372344a1be","block_type":"box","text":"reserves, the availability of sufficient foreign exchange on the date a payment is due, the relative size of the debt","page_number":61,"box":{"x":69,"y":680,"width":809,"height":11}},{"id":"57eaea58-0e7c-43e2-ad7e-a3e89b2ae0c1","block_type":"box","text":"service burden to the economy as a whole, the governmental entity’s policy towards the International Monetary Fund","page_number":61,"box":{"x":69,"y":695,"width":832,"height":11}},{"id":"c88aa63f-29f2-4b16-9252-901ad49e406a","block_type":"box","text":"and the political constraints to which a governmental entity may be subject. Governmental entities may also be","page_number":61,"box":{"x":69,"y":710,"width":790,"height":11}},{"id":"93742bc6-1eab-4081-94fd-5e2dee23c23e","block_type":"box","text":"dependent on expected disbursements from foreign governments, multilateral agencies and others abroad to reduce","page_number":61,"box":{"x":69,"y":725,"width":831,"height":11}},{"id":"b90bfe56-3aa9-453e-9794-042b3ff5ff5c","block_type":"box","text":"principal and interest arrearages on their debt. The commitment on the par t of these governments, agencies and","page_number":61,"box":{"x":70,"y":740,"width":805,"height":11}},{"id":"37663b6d-1f95-498e-a131-0f9765921038","block_type":"box","text":"others to make such disbursements may be conditioned on the implementation of economic reforms and/or","page_number":61,"box":{"x":69,"y":755,"width":772,"height":11}},{"id":"1cfaf988-e5b4-4122-ada4-9f5cda3b89ec","block_type":"box","text":"economic per formance and the timely service of such debtor’s obligations. Failure to implement such reforms,","page_number":61,"box":{"x":69,"y":770,"width":789,"height":12}},{"id":"3c337079-aa1a-49d0-969c-22a5a0389f64","block_type":"box","text":"achieve such levels of economic per formance or repay principal or interest when due may result in the cancellation of","page_number":61,"box":{"x":69,"y":785,"width":839,"height":12}},{"id":"6d0606df-697b-4396-833b-54af7c1fd93f","block_type":"box","text":"such third par ties’ commitments to lend funds to the governmental entity, which may fur ther impair such debtor’s","page_number":61,"box":{"x":69,"y":801,"width":810,"height":11}},{"id":"6e7dd1c0-0622-4e50-9579-05ce55723813","block_type":"box","text":"ability or willingness to timely service its debts. Consequently, governmental entities may default on their sovereign","page_number":61,"box":{"x":69,"y":816,"width":821,"height":11}},{"id":"a744d118-bd4b-4d69-9d0f-c0efdc981b19","block_type":"box","text":"debt.","page_number":61,"box":{"x":69,"y":831,"width":34,"height":9}},{"id":"45e2a67b-4a25-4def-b1d5-156cc20c4e63","block_type":"box","text":"Holders of sovereign debt may be requested to par ticipate in the rescheduling of such debt and to extend fur ther","page_number":61,"box":{"x":102,"y":853,"width":807,"height":12}},{"id":"23a3c4bf-5f45-4d9e-84f0-159337ad7947","block_type":"box","text":"loans to governmental entities. In the event of a default by a governmental entity, there may be few or no effective","page_number":61,"box":{"x":70,"y":869,"width":814,"height":11}},{"id":"646793be-83f7-45dc-ba92-e6d503a46c1f","block_type":"box","text":"legal remedies for collecting on such debt.","page_number":61,"box":{"x":70,"y":884,"width":300,"height":11}},{"id":"9d888758-81bc-428b-83fc-1316714b25b8","block_type":"box","text":"II-30","page_number":61,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"7125ac50-8d23-4de2-803c-3f54762a36e7","block_type":"box","text":"NM1026U-5982568-61/232","page_number":61,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"e9fc2a82-7a4c-4c2c-b5e5-3a911e27ee77","block_type":"box","text":"Withholding Tax Reclaims Risk","page_number":62,"box":{"x":103,"y":45,"width":215,"height":11}},{"id":"afb5371e-4dc0-4d7a-b09e-55c1d3421a4c","block_type":"box","text":". A Fund may file claims to recover foreign withholding taxes on dividend and","page_number":62,"box":{"x":318,"y":45,"width":542,"height":11}},{"id":"2a647fe0-ad5b-420d-8ca4-55e3bc86ca0d","block_type":"box","text":"interest income (if any) received from issuers in cer tain countries and capital gains on the disposition of stocks or","page_number":62,"box":{"x":70,"y":60,"width":813,"height":11}},{"id":"777c8737-cfbd-4787-aa75-98afe1db4d88","block_type":"box","text":"securities where such withholding tax reclaim is possible. Whether or when a Fund will receive a withholding tax","page_number":62,"box":{"x":69,"y":75,"width":795,"height":11}},{"id":"a5c99625-d869-43e9-9872-2071ccf551d1","block_type":"box","text":"refund is within the control of the tax authorities in such countries. Where a Fund expects to recover withholding","page_number":62,"box":{"x":69,"y":90,"width":799,"height":11}},{"id":"f8b9eb81-0891-404f-85d4-e3deb7d8171d","block_type":"box","text":"taxes, the net asset value of the Fund generally includes accruals for such tax refunds. Each Fund regularly evaluates","page_number":62,"box":{"x":68,"y":105,"width":838,"height":11}},{"id":"c0b5107a-c033-4fcd-bf43-092855043342","block_type":"box","text":"the probability of recovery. If the likelihood of recovery materially decreases, due to, for example, a change in tax","page_number":62,"box":{"x":68,"y":120,"width":807,"height":12}},{"id":"3f1196d8-a2d6-45a3-9802-83069436bc3b","block_type":"box","text":"regulation or approach in the foreign country, accruals in a Fund’s net asset value for such refunds may be written","page_number":62,"box":{"x":69,"y":135,"width":814,"height":12}},{"id":"904f5b03-6d25-4a37-b490-6bdda71f795b","block_type":"box","text":"down par tially or in full, which will adversely affect the Fund’s net asset value. Shareholders in a Fund at the time an","page_number":62,"box":{"x":69,"y":150,"width":831,"height":12}},{"id":"1e7814f2-e19e-4405-862d-99dd16dde87f","block_type":"box","text":"accrual is written down will bear the impact of the resulting reduction in net asset value regardless of whether they","page_number":62,"box":{"x":69,"y":166,"width":819,"height":11}},{"id":"f8c30275-f8e2-40a5-93fa-36d6f3d35282","block_type":"box","text":"were shareholders during the accrual period. Conversely, if a Fund receives a tax refund that has not been previously","page_number":62,"box":{"x":68,"y":181,"width":833,"height":11}},{"id":"fddffcda-979b-4fb3-943f-92ff46f25c61","block_type":"box","text":"accrued, shareholders in the Fund at the time of the successful recovery will benefit from the resulting increase in","page_number":62,"box":{"x":69,"y":196,"width":814,"height":11}},{"id":"eca38f4f-da5a-46be-9b33-4fc05eaa9628","block_type":"box","text":"the Fund’s net asset value. Shareholders who sold their shares prior to such time will not benefit from such increase","page_number":62,"box":{"x":68,"y":211,"width":835,"height":11}},{"id":"7fd77339-5bb4-4c88-9d81-ee6cdc1e2ba7","block_type":"box","text":"in the Fund’s net asset value.","page_number":62,"box":{"x":70,"y":226,"width":209,"height":9}},{"id":"1e85a2ff-ea6e-4b6d-9143-6940cd818ab9","block_type":"box","text":"U.S. Economic Trading Par tners Risk.","page_number":62,"box":{"x":103,"y":249,"width":263,"height":11}},{"id":"74d9ce20-8677-4d40-b71f-3e762c85feb4","block_type":"box","text":"The United States is a significant, and in some cases the most significant,","page_number":62,"box":{"x":372,"y":249,"width":532,"height":11}},{"id":"ff4b90c1-eb86-49d0-9e7c-454fb6a05c93","block_type":"box","text":"trading par tner of, or foreign investor in, cer tain countries in which a Fund may invest. As a result, economic","page_number":62,"box":{"x":68,"y":264,"width":773,"height":11}},{"id":"4e6747c9-4ad7-4e95-8844-47adb6b4d453","block_type":"box","text":"conditions of such countries may be par ticularly affected by changes in the U.S. economy. A decrease in U.S. impor ts","page_number":62,"box":{"x":69,"y":279,"width":839,"height":11}},{"id":"d35c8138-7e65-4377-924b-d8d975422441","block_type":"box","text":"or expor ts, new trade and financial regulations or tariffs, changes in the U.S. dollar exchange rate or an economic","page_number":62,"box":{"x":69,"y":294,"width":812,"height":11}},{"id":"49303ca4-e0c1-43d8-a9e9-8e0c12613d94","block_type":"box","text":"slowdown in the United States may have a material adverse effect on a country’s economic conditions and, as a","page_number":62,"box":{"x":69,"y":309,"width":803,"height":11}},{"id":"f03577cf-4621-43fa-b121-7585950e42b5","block_type":"box","text":"result, securities to which the Fund has exposure. Circumstances could arise that could prevent the timely payment","page_number":62,"box":{"x":69,"y":324,"width":824,"height":11}},{"id":"e76a1d62-cd64-4594-85d4-d67a7783ba4d","block_type":"box","text":"of interest or principal on U.S. Government debt, such as reaching the legislative “debt ceiling.” Such non-payment","page_number":62,"box":{"x":69,"y":339,"width":819,"height":12}},{"id":"02082c58-0b71-40e8-b2d1-404effeae3dc","block_type":"box","text":"would result in substantial negative consequences for the U.S. economy and the global financial system.","page_number":62,"box":{"x":68,"y":355,"width":746,"height":11}},{"id":"eedf2ce4-8200-421d-92d8-408e004f4000","block_type":"box","text":"There are strained relations between the United States and a number of foreign countries, including traditional","page_number":62,"box":{"x":101,"y":377,"width":787,"height":12}},{"id":"535f5670-ae72-4cd6-8f3f-d1f99f91c6c0","block_type":"box","text":"allies, such as cer tain European countries, and historical adversaries, such as Nor th Korea, Iran, China and Russia.","page_number":62,"box":{"x":69,"y":392,"width":827,"height":11}},{"id":"76d347d9-555c-4f5b-8168-0358c1b8ddb9","block_type":"box","text":"If these relations were to worsen, it could adversely affect U.S. issuers as well as non-U.S. issuers that rely on the","page_number":62,"box":{"x":70,"y":407,"width":817,"height":12}},{"id":"24782973-76bf-4bbf-b84d-bdd68cf164bc","block_type":"box","text":"United States for trade. The United States has also experienced increased internal unrest and discord. If these","page_number":62,"box":{"x":70,"y":423,"width":791,"height":11}},{"id":"935ee933-24d7-4e6b-be2a-a45143364400","block_type":"box","text":"trends were to continue, it may have an adverse impact on the U.S. economy and many of the issuers in which a","page_number":62,"box":{"x":68,"y":438,"width":803,"height":11}},{"id":"50cb72ff-3ee8-40a5-83e8-9bae500813a7","block_type":"box","text":"Fund may invest.","page_number":62,"box":{"x":70,"y":453,"width":117,"height":11}},{"id":"6bffa96f-bd3f-4580-b55c-2585585dbf15","block_type":"box","text":"Funding Agreements.","page_number":62,"box":{"x":102,"y":476,"width":154,"height":11}},{"id":"e91a8bc8-cc45-4f38-b405-73a9bf7b3095","block_type":"box","text":"Cer tain Funds may invest in Guaranteed Investment Contracts and similar funding","page_number":62,"box":{"x":262,"y":475,"width":584,"height":12}},{"id":"7ab94c45-7af5-4934-92c6-d932410ec2f2","block_type":"box","text":"agreements. In connection with these investments, a Fund makes cash contributions to a deposit fund of an","page_number":62,"box":{"x":69,"y":491,"width":773,"height":11}},{"id":"cc9d3ee3-6876-402b-aba4-e0178d213577","block_type":"box","text":"insurance company’s general account. The insurance company then credits to the Fund on a monthly basis","page_number":62,"box":{"x":70,"y":506,"width":761,"height":11}},{"id":"03c2f20d-60e6-46e9-9ca6-64ada61f35f2","block_type":"box","text":"guaranteed interest, which is based on an index. The funding agreements provide that this guaranteed interest will","page_number":62,"box":{"x":68,"y":521,"width":817,"height":11}},{"id":"185ae5f4-0a3d-4e7c-a7e9-8053cd8af387","block_type":"box","text":"not be less than a cer tain minimum rate. The purchase price paid for a funding agreement becomes par t of the","page_number":62,"box":{"x":69,"y":536,"width":794,"height":11}},{"id":"455045de-c75a-40a1-9c78-cdd6583f28d0","block_type":"box","text":"general assets of the insurance company, and the contract is paid from the general assets of the insurance company.","page_number":62,"box":{"x":68,"y":551,"width":839,"height":11}},{"id":"c9e0cd6e-5745-47d1-a8a8-d22090ce6ab7","block_type":"box","text":"Generally, funding agreements are not assignable or transferable without the permission of the issuing insurance","page_number":62,"box":{"x":69,"y":566,"width":806,"height":11}},{"id":"9645cbf8-637d-4d2c-92b1-bc42df412284","block_type":"box","text":"companies, and an active secondary market in some funding agreements does not currently exist.","page_number":62,"box":{"x":69,"y":581,"width":700,"height":12}},{"id":"42621f7f-c37e-4375-b33f-d3d7d3252832","block_type":"box","text":"Guarantees.","page_number":62,"box":{"x":102,"y":604,"width":87,"height":9}},{"id":"5272e9f0-4158-43d7-afe5-381fd390cec4","block_type":"box","text":"A Fund may purchase securities which contain guarantees issued by an entity separate from the","page_number":62,"box":{"x":194,"y":604,"width":685,"height":11}},{"id":"aadfaa8b-6258-4374-bd08-7c93b1e2e36d","block_type":"box","text":"issuer of the security. Generally, the guarantor of a security (often an affiliate of the issuer) will fulfill an issuer’s","page_number":62,"box":{"x":70,"y":619,"width":797,"height":11}},{"id":"0392d47c-62f4-4d8c-8c40-0f10f60d2663","block_type":"box","text":"payment obligations under a security if the issuer is unable to do so.","page_number":62,"box":{"x":70,"y":634,"width":488,"height":12}},{"id":"37e02756-fa24-4b59-9d30-ada727d6bd7f","block_type":"box","text":"Illiquid Investments.","page_number":62,"box":{"x":102,"y":657,"width":146,"height":11}},{"id":"c9257794-de74-4b81-bda4-962a9f835730","block_type":"box","text":"Each Fund may not acquire any illiquid investment if, immediately after the acquisition, a","page_number":62,"box":{"x":255,"y":657,"width":630,"height":11}},{"id":"6cad6ba9-59c3-471b-8aed-d749c1dda717","block_type":"box","text":"Fund would have invested more than 15% of its net assets in illiquid investments. 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There can be","page_number":62,"box":{"x":70,"y":717,"width":838,"height":12}},{"id":"dd3637a2-1612-4ed1-a445-5b1ace08e133","block_type":"box","text":"no assurance that a security or instrument that is deemed to be liquid when purchased will continue to be liquid for","page_number":62,"box":{"x":69,"y":732,"width":824,"height":12}},{"id":"bbb5c769-d6bd-4aea-a7d5-ab8b82f34851","block_type":"box","text":"as long as it is held by a Fund, and any security or instrument held by the Fund may be deemed an illiquid investment","page_number":62,"box":{"x":69,"y":748,"width":838,"height":11}},{"id":"c1ab7a4e-30eb-4fdf-baaa-5a7137a9f368","block_type":"box","text":"pursuant to the Fund’s liquidity risk management program. A Fund’s illiquid investments may reduce the returns of","page_number":62,"box":{"x":70,"y":763,"width":816,"height":11}},{"id":"ed9e9092-7a1a-41e7-b372-7ab25bea2620","block_type":"box","text":"the Fund because it may be difficult to sell the illiquid investments at an advantageous time or price. 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If illiquid","page_number":62,"box":{"x":69,"y":823,"width":781,"height":12}},{"id":"b2317a15-821d-4464-8a90-13178637954c","block_type":"box","text":"investments exceed 15% of a Fund’s net assets, the Liquidity Rule (as defined below) and the Liquidity Program (as","page_number":62,"box":{"x":70,"y":838,"width":822,"height":12}},{"id":"678efc21-7b8e-41cb-a5e1-a8da1b4040eb","block_type":"box","text":"defined below) will require that cer tain remedial actions be taken. Illiquid investments may trade at a discount from","page_number":62,"box":{"x":69,"y":853,"width":822,"height":12}},{"id":"9548799c-6038-4e09-9683-8077740fc3a0","block_type":"box","text":"comparable liquid investments. Investment of a Fund’s assets in illiquid investments may restrict the ability of the","page_number":62,"box":{"x":69,"y":869,"width":813,"height":11}},{"id":"53049346-4439-4efc-a670-94449df86eb6","block_type":"box","text":"Fund to dispose of its investments in a timely fashion and for a fair price as well as its ability to take advantage of","page_number":62,"box":{"x":70,"y":884,"width":814,"height":11}},{"id":"98774926-6bf5-4874-8565-5ca0d5a42a1d","block_type":"box","text":"market oppor tunities. 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The Manager will make investment changes to a Fund’s por tfolio to accommodate cash flow","page_number":63,"box":{"x":70,"y":135,"width":810,"height":12}},{"id":"0cddbd6b-ccb6-487d-a02d-2b1d97f7dac1","block_type":"box","text":"while continuing to seek to replicate the total return of the Fund’s target index. 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Finally, since each Fund seeks to","page_number":63,"box":{"x":101,"y":196,"width":749,"height":11}},{"id":"854d498e-f5c6-4efe-b0d3-5ac6c8dbcc96","block_type":"box","text":"replicate the total return of its target index, the Manager generally will not attempt to judge the merits of any","page_number":63,"box":{"x":69,"y":211,"width":774,"height":11}},{"id":"b3798b70-2278-4b43-ba60-0497e9a21282","block_type":"box","text":"par ticular security as an investment.","page_number":63,"box":{"x":70,"y":226,"width":258,"height":11}},{"id":"55ed4b4e-9f70-4178-8cf9-d3f0eaef63be","block_type":"box","text":"Tracking Error Risk","page_number":63,"box":{"x":103,"y":249,"width":132,"height":11}},{"id":"93bcce92-2008-45ed-b6ec-14d746da0549","block_type":"box","text":". A Fund may be subject to tracking error, which is the divergence of the Fund’s per formance","page_number":63,"box":{"x":236,"y":249,"width":658,"height":11}},{"id":"b22aa5a3-4984-4b5e-ae71-433a5121090b","block_type":"box","text":"from that of the Underlying Index. Tracking error may occur because of differences between the securities and other","page_number":63,"box":{"x":68,"y":264,"width":827,"height":11}},{"id":"08b9390b-bfcb-4891-a6b6-707b29f67110","block_type":"box","text":"instruments held in the Fund’s por tfolio and those included in the Underlying Index, pricing differences (including, as","page_number":63,"box":{"x":70,"y":279,"width":830,"height":11}},{"id":"88491304-b2c2-4421-85cc-5518be37a3e3","block_type":"box","text":"applicable, differences between a security’s price at the local market close and the Fund’s valuation of a security at","page_number":63,"box":{"x":69,"y":294,"width":827,"height":11}},{"id":"94fcb858-73b0-4582-92a1-c2f4f1166a63","block_type":"box","text":"the time of calculation of the Fund’s net asset value), differences in transaction costs incurred by the Fund, the","page_number":63,"box":{"x":68,"y":309,"width":797,"height":11}},{"id":"14c612eb-ecbe-4a34-a4de-a03d370fd7a0","block_type":"box","text":"Fund’s holding of uninvested cash, differences in timing of the accrual of or the valuation of dividends or other","page_number":63,"box":{"x":70,"y":324,"width":787,"height":12}},{"id":"e6fa939f-5935-4a25-acbb-3fe2c7b073e2","block_type":"box","text":"distributions, interest, the requirements to maintain pass-through tax treatment, por tfolio transactions carried out to","page_number":63,"box":{"x":69,"y":339,"width":830,"height":12}},{"id":"403527d0-7f22-40b0-973f-93c8a0aab39d","block_type":"box","text":"minimize the distribution of capital gains to shareholders, changes to the Underlying Index or the costs to the Fund of","page_number":63,"box":{"x":69,"y":355,"width":838,"height":11}},{"id":"e08cfcf3-eb6d-4ef1-8283-ee979363659c","block_type":"box","text":"complying with various new or existing regulatory requirements. These risks may be heightened during times of","page_number":63,"box":{"x":69,"y":370,"width":791,"height":11}},{"id":"b796e6c1-e3d1-4147-ba07-a3ae1310f2de","block_type":"box","text":"increased market volatility or other unusual market conditions. In addition, tracking error may result because the","page_number":63,"box":{"x":70,"y":385,"width":801,"height":11}},{"id":"905f2205-140f-4dee-8e75-4c61a76cb84c","block_type":"box","text":"Fund incurs fees and expenses, while the Underlying Index does not.","page_number":63,"box":{"x":70,"y":400,"width":487,"height":11}},{"id":"405ce489-1bd8-407e-a117-b2347c0c855d","block_type":"box","text":"When an issuer is introduced by an index provider into an index tracked by a Fund, the Manager may conduct an","page_number":63,"box":{"x":101,"y":423,"width":799,"height":11}},{"id":"2bf2ccc4-77d6-4661-82d6-3c7ea82508e1","block_type":"box","text":"analysis on such issuer’s securities to identify and screen for outlier high risk behavior (such as rapid or unusual","page_number":63,"box":{"x":69,"y":438,"width":803,"height":11}},{"id":"715f307c-5d1b-42c1-8c5f-156b7ee336bd","block_type":"box","text":"price growth that does not appear to be suppor ted by publicly available information on the business and assets of","page_number":63,"box":{"x":70,"y":453,"width":814,"height":11}},{"id":"665c5d23-cbba-47ee-b480-7e0264f8a987","block_type":"box","text":"the issuer, unusual or significant shor t interest or lending activity, negative sentiment, suspended trading or incorrect","page_number":63,"box":{"x":68,"y":468,"width":838,"height":11}},{"id":"a3636d9d-f8e6-4ba2-b8ab-6e9cefb40d9e","block_type":"box","text":"free-float calculations, which could be indicators of possible irregularities, miscalculations or even fraud). 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If the securities continue to be included in the index, the Manager may underweight or","page_number":63,"box":{"x":68,"y":528,"width":819,"height":12}},{"id":"1195a44c-5be3-4491-93a4-db13c51249f5","block_type":"box","text":"exclude such securities from a Fund’s por tfolio and, if it does so, such Fund will be subject to increased tracking","page_number":63,"box":{"x":69,"y":543,"width":804,"height":12}},{"id":"3c7836c2-57b7-48b0-adbd-960d538b8e97","block_type":"box","text":"error due to the divergence in the securities included in its por tfolio from its underlying index. 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S&P makes no","page_number":63,"box":{"x":69,"y":687,"width":818,"height":11}},{"id":"eb9dbaa4-8d22-414c-9c1c-d7731ed5bf17","block_type":"box","text":"representation or warranty, express or implied, to the owners of shares of a Fund or any member of the public","page_number":63,"box":{"x":69,"y":702,"width":783,"height":11}},{"id":"15f5fcc4-b22f-4835-bb01-d8feaab9eb36","block_type":"box","text":"regarding the advisability of investing in securities generally or in a Fund par ticularly or the ability of the S&P 500 to","page_number":63,"box":{"x":69,"y":717,"width":823,"height":12}},{"id":"108de77b-8096-450e-979c-46d58867e120","block_type":"box","text":"track general stock market per formance. S&P’s only relationship to cer tain Funds is the licensing of cer tain","page_number":63,"box":{"x":68,"y":732,"width":769,"height":12}},{"id":"69642f64-c2a6-4bbb-a8cd-abe6302508b6","block_type":"box","text":"trademarks and trade names of S&P and of the S&P 500 which is determined, composed and calculated by S&P","page_number":63,"box":{"x":68,"y":748,"width":804,"height":11}},{"id":"2e56d04d-6d70-43f3-a6a1-a8527ff1938c","block_type":"box","text":"without regard to the Funds. S&P has no obligation to take the needs of a Fund or the owners of shares of a Fund","page_number":63,"box":{"x":68,"y":763,"width":811,"height":11}},{"id":"fc480509-f876-4d37-a9a6-3cf205a53218","block_type":"box","text":"into consideration in determining, composing or calculating the S&P 500. 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A Fund may also invest in so-called “inverse floating obligations”","page_number":65,"box":{"x":69,"y":339,"width":837,"height":12}},{"id":"880ef4e5-632e-44fb-97a3-b26d7d5b745b","block_type":"box","text":"or “residual interest bonds” on which the interest rates vary inversely with a floating rate (which may be reset","page_number":65,"box":{"x":69,"y":355,"width":781,"height":11}},{"id":"55f984e8-a6d9-4c40-b69b-91309dd64b49","block_type":"box","text":"periodically by a Dutch auction, a remarketing agent, or by reference to a shor t-term tax-exempt interest rate index). A","page_number":65,"box":{"x":70,"y":370,"width":838,"height":11}},{"id":"4ae76dc4-764b-4c9d-a32d-a188132b446e","block_type":"box","text":"Fund may purchase synthetically-created inverse floating rate bonds evidenced by custodial or trust receipts.","page_number":65,"box":{"x":70,"y":385,"width":771,"height":11}},{"id":"f7ceb3f8-2b9b-4a18-a39a-cf56f93386eb","block_type":"box","text":"Generally, income on inverse floating rate bonds will decrease when interest rates increase, and will increase when","page_number":65,"box":{"x":69,"y":400,"width":820,"height":11}},{"id":"f0a06d35-2a9a-4b9b-b75f-71b4df76882c","block_type":"box","text":"interest rates decrease. Such securities have the effect of providing a degree of investment leverage, since they may","page_number":65,"box":{"x":70,"y":415,"width":835,"height":11}},{"id":"5017cd79-4a5a-435c-9b14-115d9fd9dc2e","block_type":"box","text":"increase or decrease in value in response to changes, as an illustration, in market interest rates at a rate that is a","page_number":65,"box":{"x":70,"y":430,"width":817,"height":11}},{"id":"4126c087-440e-4e46-bbb1-31a1cdbdaa13","block_type":"box","text":"multiple of the rate at which fixed-rate securities increase or decrease in response to such changes. As a result, the","page_number":65,"box":{"x":69,"y":445,"width":829,"height":12}},{"id":"483be1a6-5998-41b7-bc95-9672db80eda1","block_type":"box","text":"market values of such securities will generally be more volatile than the market values of fixed-rate securities. To","page_number":65,"box":{"x":69,"y":460,"width":804,"height":12}},{"id":"bbcdebfa-b4e2-40f2-bbc6-9503c5795c61","block_type":"box","text":"seek to limit the volatility of these securities, a Fund may purchase inverse floating obligations that have shor ter-term","page_number":65,"box":{"x":69,"y":475,"width":838,"height":12}},{"id":"9e9daa63-be04-4e52-8254-e58108cde708","block_type":"box","text":"maturities or that contain limitations on the extent to which the interest rate may vary. Cer tain investments in such","page_number":65,"box":{"x":69,"y":491,"width":819,"height":11}},{"id":"182dfe8d-f608-4b9b-aac8-1ef185841c10","block_type":"box","text":"obligations may be illiquid. The Manager believes that indexed and inverse floating obligations represent flexible","page_number":65,"box":{"x":69,"y":506,"width":798,"height":11}},{"id":"d71f9aae-2098-4307-9125-0a6e4331e7a8","block_type":"box","text":"por tfolio management instruments for a Fund that allow the Fund to seek potential investment rewards, hedge other","page_number":65,"box":{"x":70,"y":521,"width":829,"height":11}},{"id":"a5a53a5a-bee6-476c-819c-41c1d28dc2fa","block_type":"box","text":"por tfolio positions or vary the degree of investment leverage relatively efficiently under different market conditions. A","page_number":65,"box":{"x":70,"y":536,"width":834,"height":11}},{"id":"d086ef7b-ce5a-4ba0-8806-f893b2748ee2","block_type":"box","text":"Fund may invest in indexed and inverse securities for hedging purposes or to seek to increase returns. When used for","page_number":65,"box":{"x":70,"y":551,"width":839,"height":11}},{"id":"54bc7e38-1f89-4bbb-ac63-d2e1f522edf8","block_type":"box","text":"hedging purposes, indexed and inverse securities involve correlation risk. Fur thermore, where such a security","page_number":65,"box":{"x":69,"y":566,"width":781,"height":11}},{"id":"6ab22a8a-2c5b-4277-9431-0b6ef3c6b4b3","block_type":"box","text":"includes a contingent liability, in the event of an adverse movement in the underlying index or interest rate, a Fund","page_number":65,"box":{"x":70,"y":581,"width":812,"height":12}},{"id":"b20f8932-9130-44ae-84d0-04efc2194596","block_type":"box","text":"may be required to pay substantial additional margin to maintain the position.","page_number":65,"box":{"x":69,"y":597,"width":553,"height":11}},{"id":"b6cc2f56-90e4-4f11-9bf8-8ffc2c995f84","block_type":"box","text":"The Funds may invest up to 10% of their total assets in leveraged inverse floating rate debt instruments","page_number":65,"box":{"x":101,"y":619,"width":741,"height":11}},{"id":"3ce2ca44-018a-4db2-b3b0-16c37dcc21c7","block_type":"box","text":"(“inverse floaters”). Inverse floaters are securities the potential of which is inversely related to changes in interest","page_number":65,"box":{"x":69,"y":634,"width":815,"height":12}},{"id":"204bb4cb-926c-49b6-b624-4ec8b83f3e8a","block_type":"box","text":"rates. In general, the return on inverse floaters will decrease when shor t-term interest rates increase and increase","page_number":65,"box":{"x":69,"y":649,"width":817,"height":12}},{"id":"f24d62dc-f89d-4217-98df-9c804ff1da3d","block_type":"box","text":"when shor t-term rates decrease. Municipal tender option bonds, both taxable and tax-exempt, which may include","page_number":65,"box":{"x":68,"y":665,"width":805,"height":11}},{"id":"d1a3d843-d439-479c-b721-f58795809c6a","block_type":"box","text":"inverse floating rate debt instruments, (including residual interests thereon) are excluded from this 10% limitation.","page_number":65,"box":{"x":70,"y":680,"width":813,"height":11}},{"id":"7e3e472e-c48a-49b5-b375-c7ac2edc3a16","block_type":"box","text":"Inflation Risk.","page_number":65,"box":{"x":102,"y":702,"width":100,"height":9}},{"id":"7bfa14c5-f60e-43e8-8df8-c177dfd33f38","block_type":"box","text":"Like all funds, the Funds are subject to inflation risk. Inflation risk is the risk that the present","page_number":65,"box":{"x":209,"y":702,"width":663,"height":11}},{"id":"0db074c1-b5e2-4cd0-94fe-5302fe382fdf","block_type":"box","text":"value of assets or income from investments will be less in the future as inflation decreases the value of money. As","page_number":65,"box":{"x":68,"y":717,"width":820,"height":12}},{"id":"7267bb60-c5d8-483a-b217-90cf328142e9","block_type":"box","text":"inflation increases, the present value of a Fund’s assets can decline as can the value of a Fund’s distributions.","page_number":65,"box":{"x":70,"y":732,"width":792,"height":11}},{"id":"cad4fa98-5dc1-484c-a701-8bb3ca71fd50","block_type":"box","text":"Inflation rates may change frequently and significantly due to a number of potential factors, including, among others,","page_number":65,"box":{"x":70,"y":748,"width":829,"height":11}},{"id":"9d016c24-81d2-4da7-a459-62f8140823af","block_type":"box","text":"unexpected economic shifts or changes in fiscal or monetary policies.","page_number":65,"box":{"x":69,"y":763,"width":497,"height":11}},{"id":"33146d99-225c-4ae1-bff1-42398ea19b1b","block_type":"box","text":"Initial Public Offering (“IPO”) Risk.","page_number":65,"box":{"x":102,"y":785,"width":253,"height":12}},{"id":"03d09a21-e26a-415c-a971-36e914800e7d","block_type":"box","text":"The volume of IPOs and the levels at which the newly issued stocks trade in","page_number":65,"box":{"x":361,"y":785,"width":540,"height":12}},{"id":"4d69468e-c01c-4e5a-9710-40caf76c569a","block_type":"box","text":"the secondary market are affected by the per formance of the stock market overall. If IPOs are brought to the market,","page_number":65,"box":{"x":68,"y":801,"width":836,"height":11}},{"id":"c5b2d9ae-5e36-459d-a4cf-6b5d1fa09782","block_type":"box","text":"availability may be limited and a Fund may not be able to buy any shares at the offering price, or if it is able to buy","page_number":65,"box":{"x":69,"y":816,"width":815,"height":11}},{"id":"e3b79e17-2eec-467a-b7dc-a4316474a51a","block_type":"box","text":"shares, it may not be able to buy as many shares at the offering price as it would like. In addition, the prices of","page_number":65,"box":{"x":69,"y":831,"width":795,"height":11}},{"id":"85e08fc1-0a08-42ff-ab06-9180866069de","block_type":"box","text":"securities involved in IPOs are often subject to greater and more unpredictable price changes than more established","page_number":65,"box":{"x":69,"y":846,"width":829,"height":11}},{"id":"b588d827-2d8d-4dab-ac84-6f460ef03952","block_type":"box","text":"stocks. IPOs have the potential to produce substantial gains. A Fund may hold shares from an IPO for only a shor t","page_number":65,"box":{"x":69,"y":861,"width":814,"height":11}},{"id":"9679a1ae-6bd7-4c0b-b615-56ade00ea00c","block_type":"box","text":"period of time given possible price volatility. This may result in increased por tfolio turnover and expenses, such as","page_number":65,"box":{"x":70,"y":876,"width":813,"height":11}},{"id":"f6c2b799-db6e-4c8b-812b-60ced6199967","block_type":"box","text":"commissions and transaction costs, and potentially result in taxable gains that the Fund will subsequently distribute","page_number":65,"box":{"x":69,"y":891,"width":828,"height":12}},{"id":"33ea2fb5-bacb-4400-a002-f99b68b87f7b","block_type":"box","text":"to shareholders. There is no assurance that any Fund will have access to profitable IPOs and therefore investors","page_number":65,"box":{"x":68,"y":906,"width":802,"height":12}},{"id":"a9fdae40-0400-4ea7-b272-425422241ef2","block_type":"box","text":"II-34","page_number":65,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"f2014fc2-235d-4923-8d66-bca1049770c4","block_type":"box","text":"NM1026U-5982568-65/232","page_number":65,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"d0fcf6bd-1c7c-42e1-8e02-a7aae28387c8","block_type":"box","text":"should not rely on any past gains from IPOs as an indication of future per formance. The investment per formance of a","page_number":66,"box":{"x":69,"y":45,"width":837,"height":11}},{"id":"5e974719-7725-4893-8746-4ad5599a853a","block_type":"box","text":"Fund during periods when it is unable to invest significantly or at all in IPOs may be lower than during periods when it","page_number":66,"box":{"x":70,"y":60,"width":832,"height":11}},{"id":"f51e183f-d770-407c-a2fd-e354feaa2124","block_type":"box","text":"is able to do so. In addition, as a Fund increases in size, the impact of IPOs on its per formance will generally","page_number":66,"box":{"x":70,"y":75,"width":777,"height":11}},{"id":"cc7e67b1-615d-438f-80e2-3e8c5a1e0afd","block_type":"box","text":"decrease. Securities issued in IPOs are subject to many of the same risks as investing in companies with smaller","page_number":66,"box":{"x":69,"y":90,"width":810,"height":11}},{"id":"4070ca1a-1268-47af-b808-c1711bec4c8a","block_type":"box","text":"market capitalizations. Securities issued in IPOs have no trading history, and information about the companies may","page_number":66,"box":{"x":69,"y":105,"width":823,"height":11}},{"id":"d952976b-478d-44b3-9cbd-e83866f9e4ec","block_type":"box","text":"be available for very limited periods.","page_number":66,"box":{"x":69,"y":120,"width":257,"height":11}},{"id":"b1e0d250-20e4-4deb-bfdf-ffc8c80d4b1f","block_type":"box","text":"Investment in Emerging Markets.","page_number":66,"box":{"x":102,"y":143,"width":242,"height":11}},{"id":"1b7cc969-ad06-4b67-95fb-c549219627c1","block_type":"box","text":"General.","page_number":66,"box":{"x":102,"y":166,"width":58,"height":9}},{"id":"e47acfca-d457-4f8c-b702-c946b60a298c","block_type":"box","text":"Cer tain Funds may invest in the securities of issuers domiciled in various countries with emerging capital","page_number":66,"box":{"x":102,"y":188,"width":748,"height":12}},{"id":"d34bf120-ddd8-45f9-8591-f3fbde4413af","block_type":"box","text":"markets. Unless otherwise provided in a Fund’s Prospectus, a country with an emerging capital market is any country","page_number":66,"box":{"x":69,"y":204,"width":840,"height":11}},{"id":"27e29f71-65fd-46b3-aaa5-c60fb460ad36","block_type":"box","text":"that is (i) generally recognized to be an emerging market country by the international financial community, such as","page_number":66,"box":{"x":68,"y":218,"width":813,"height":12}},{"id":"f3accbcc-7528-4a1a-a634-96de3cd43a7a","block_type":"box","text":"the International Finance Corporation, or determined by the World Bank to have a low, middle or middle upper income","page_number":66,"box":{"x":68,"y":234,"width":836,"height":11}},{"id":"6ce1d607-1a6b-4b69-93b8-25e81d6e7c2f","block_type":"box","text":"economy; (ii) classified by the United Nations or its authorities to be developing; and/or (iii) included in a broad-based","page_number":66,"box":{"x":69,"y":249,"width":839,"height":11}},{"id":"5ac03b24-b733-4086-a641-c1d78ac105e2","block_type":"box","text":"index that is generally representative of emerging markets. Countries with emerging markets can be found in regions","page_number":66,"box":{"x":70,"y":264,"width":831,"height":11}},{"id":"4bd855f1-4e3e-4c97-a914-ce373cd82187","block_type":"box","text":"such as Asia, Latin America, Eastern Europe and Africa.","page_number":66,"box":{"x":69,"y":279,"width":396,"height":11}},{"id":"bafd2f9e-3640-4284-9585-e666359a1721","block_type":"box","text":"Investments in the securities of issuers domiciled in countries with emerging capital markets involve cer tain","page_number":66,"box":{"x":102,"y":302,"width":770,"height":11}},{"id":"4c8f9960-f069-4d0a-aa66-8bac9863b839","block_type":"box","text":"additional risks that do not generally apply to investments in securities of issuers in more developed capital markets,","page_number":66,"box":{"x":69,"y":317,"width":835,"height":11}},{"id":"ab25bcf9-09a3-4b6b-b6cd-f6bf5d7009fa","block_type":"box","text":"such as (i) low or non-existent trading volume, resulting in market illiquidity and increased volatility in prices for such","page_number":66,"box":{"x":69,"y":332,"width":828,"height":11}},{"id":"d806914b-ace1-4b28-9d67-4c635460b1b5","block_type":"box","text":"securities, as compared to securities of comparable issuers in more developed capital markets; (ii) uncer tain","page_number":66,"box":{"x":69,"y":347,"width":779,"height":11}},{"id":"fa7be707-9973-427e-b679-6fd3d6b708f6","block_type":"box","text":"national policies and social, political and economic instability, increasing the potential for expropriation of assets,","page_number":66,"box":{"x":69,"y":362,"width":809,"height":11}},{"id":"7dcb0c03-4b80-433f-87c1-92b4ad56894a","block_type":"box","text":"confiscatory taxation, high rates of inflation or unfavorable diplomatic developments; (iii) possible fluctuations in","page_number":66,"box":{"x":69,"y":377,"width":800,"height":12}},{"id":"155131e8-292c-430c-81fe-9ce9a8b8aa6e","block_type":"box","text":"exchange rates, differing legal systems and the existence or possible imposition of exchange controls, custodial","page_number":66,"box":{"x":69,"y":392,"width":800,"height":12}},{"id":"8103fece-6634-4237-9e00-040755703bc3","block_type":"box","text":"restrictions or other foreign or U.S. Governmental laws or restrictions applicable to such investments; (iv) national","page_number":66,"box":{"x":69,"y":407,"width":811,"height":12}},{"id":"b15f90f4-2c0d-4246-9263-bc71e9050bde","block_type":"box","text":"policies that may limit a Fund’s investment oppor tunities such as restrictions on investment in issuers or industries","page_number":66,"box":{"x":70,"y":423,"width":824,"height":11}},{"id":"6bf97952-78a6-40be-bb45-dca95993de3e","block_type":"box","text":"deemed sensitive to national interests; and (v) the lack or relatively early development of legal structures governing","page_number":66,"box":{"x":69,"y":438,"width":823,"height":11}},{"id":"30ebfe09-bccb-493d-a15e-7d7daae0c5e2","block_type":"box","text":"private and foreign investments and private proper ty. In addition to withholding taxes on investment income, some","page_number":66,"box":{"x":70,"y":453,"width":813,"height":11}},{"id":"c6e715cc-3354-4eb6-ab39-9a0aa4c5a9b7","block_type":"box","text":"countries with emerging markets may impose differential capital gains taxes on foreign investors.","page_number":66,"box":{"x":69,"y":468,"width":694,"height":11}},{"id":"3bbfe37c-d46e-4784-bd23-83113cca3630","block_type":"box","text":"Political and economic structures in emerging market countries may be undergoing significant evolution and","page_number":66,"box":{"x":102,"y":491,"width":767,"height":11}},{"id":"29ae43cb-2315-4a77-8975-e639a32be524","block_type":"box","text":"rapid development, and these countries may lack the social, political and economic stability characteristic of more","page_number":66,"box":{"x":69,"y":506,"width":814,"height":11}},{"id":"451022be-62f2-4cb5-8ea9-bd4ac6da11a4","block_type":"box","text":"developed countries. In such a dynamic environment, there can be no assurance that any or all of these capital","page_number":66,"box":{"x":69,"y":521,"width":792,"height":11}},{"id":"70392f2b-504e-466e-9161-696111523bc7","block_type":"box","text":"markets will continue to present viable investment oppor tunities for a Fund. In the past, governments of such nations","page_number":66,"box":{"x":69,"y":536,"width":838,"height":11}},{"id":"a915628b-b0bd-430b-b5e6-8408dfae85ae","block_type":"box","text":"have expropriated substantial amounts of private proper ty, and most claims of the proper ty owners have never been","page_number":66,"box":{"x":69,"y":551,"width":828,"height":11}},{"id":"ff3d6623-b707-4a2e-9816-a8b432b41d6b","block_type":"box","text":"fully settled. There is no assurance that such expropriations will not reoccur. In such an event, it is possible that a","page_number":66,"box":{"x":68,"y":566,"width":816,"height":11}},{"id":"836c77c0-3b8f-4225-ac1f-6b92736a0ab0","block_type":"box","text":"Fund could lose the entire value of its investments in the affected market. As a result the risks described above,","page_number":66,"box":{"x":70,"y":581,"width":802,"height":11}},{"id":"4572c2bd-ed41-4be6-b498-73508017c6df","block_type":"box","text":"including the risks of nationalization or expropriation of assets, may be heightened. In addition, unanticipated political","page_number":66,"box":{"x":70,"y":596,"width":838,"height":12}},{"id":"f599dd76-2114-4140-bbfe-8dd24751b7ee","block_type":"box","text":"or social developments may affect the value of investments in these countries and the availability to a Fund of","page_number":66,"box":{"x":69,"y":612,"width":788,"height":11}},{"id":"f559b4d2-548c-48a0-a5ee-b092b951dd66","block_type":"box","text":"additional investments. The small size and inexperience of the securities markets in cer tain of these countries and","page_number":66,"box":{"x":69,"y":627,"width":819,"height":11}},{"id":"916de0dd-5c62-4cc4-ba03-4fc2838c397a","block_type":"box","text":"the limited volume of trading in securities in these countries may make investments in the countries illiquid and more","page_number":66,"box":{"x":68,"y":642,"width":838,"height":11}},{"id":"86b2140a-ac4e-40c6-b6ac-e4d16291561f","block_type":"box","text":"volatile than investments in more established markets.","page_number":66,"box":{"x":68,"y":657,"width":392,"height":9}},{"id":"b8961f3f-fc7c-4709-8729-47909ae8aab0","block_type":"box","text":"Also, there may be less publicly available information about issuers in emerging markets than would be available","page_number":66,"box":{"x":101,"y":680,"width":805,"height":11}},{"id":"44d3e068-2bfc-4e0e-a703-bf900a2d7498","block_type":"box","text":"about issuers in more developed capital markets, and such issuers may not be subject to accounting, auditing and","page_number":66,"box":{"x":69,"y":695,"width":818,"height":11}},{"id":"bcc928d0-efc2-4008-89fd-8ce6fa9c2410","block_type":"box","text":"financial repor ting standards and requirements comparable to those to which U.S. companies are subject. In cer tain","page_number":66,"box":{"x":68,"y":710,"width":831,"height":11}},{"id":"9fb5bb6e-3406-494e-81e4-9aa55ee335fd","block_type":"box","text":"countries with emerging capital markets, repor ting standards vary widely. As a result, traditional investment","page_number":66,"box":{"x":69,"y":725,"width":768,"height":11}},{"id":"b687479c-04bc-4b58-a1a4-bbb263a52425","block_type":"box","text":"measurements used in the United States, such as price/earnings ratios, may not be applicable. Emerging market","page_number":66,"box":{"x":69,"y":740,"width":811,"height":11}},{"id":"a46ac76a-3e92-4161-8449-596b8f4649d6","block_type":"box","text":"securities may be substantially less liquid than, and more volatile than, those of mature markets, and company","page_number":66,"box":{"x":69,"y":755,"width":795,"height":11}},{"id":"efc4e7b1-9960-424f-9283-8d671471646c","block_type":"box","text":"shares may be held by a limited number of persons. This may adversely affect the timing and pricing of the Fund’s","page_number":66,"box":{"x":69,"y":770,"width":814,"height":12}},{"id":"50c30b82-3d66-4c6e-8c37-5e5b5887de63","block_type":"box","text":"acquisition or disposal of securities.","page_number":66,"box":{"x":69,"y":785,"width":257,"height":11}},{"id":"ae5e5652-0be7-449c-ba31-441f6c074b85","block_type":"box","text":"Practices in relation to settlement of securities transactions in emerging markets involve higher risks than those","page_number":66,"box":{"x":102,"y":808,"width":800,"height":11}},{"id":"e0a5c473-7945-42df-a4cd-1f11799aceef","block_type":"box","text":"in developed markets, in par t because a Fund will need to use brokers and counterpar ties that are less well","page_number":66,"box":{"x":70,"y":823,"width":769,"height":11}},{"id":"cab8e829-7117-4c19-b692-9f72620592e7","block_type":"box","text":"capitalized, and custody and registration of assets in some countries may be unreliable. The possibility of fraud,","page_number":66,"box":{"x":69,"y":838,"width":798,"height":12}},{"id":"d858120d-90a2-4676-8acb-43c19b09d4e7","block_type":"box","text":"negligence, undue influence being exer ted by the issuer or refusal to recognize ownership exists in some emerging","page_number":66,"box":{"x":69,"y":853,"width":819,"height":12}},{"id":"f8dc5dc5-3d8c-47ac-bdf5-387212e90279","block_type":"box","text":"markets, and, along with other factors, could result in ownership registration being completely lost. A Fund would","page_number":66,"box":{"x":69,"y":869,"width":804,"height":11}},{"id":"43dfc03f-6096-495a-a322-655914ad2203","block_type":"box","text":"absorb any loss resulting from such registration problems and may have no successful claim for compensation.","page_number":66,"box":{"x":69,"y":884,"width":794,"height":11}},{"id":"2c0e83fb-7c41-41f3-b4a7-8f31d3c6e4f0","block_type":"box","text":"II-35","page_number":66,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"dfcbdeda-c4b0-4e2d-a50b-2e972cffc9d0","block_type":"box","text":"NM1026U-5982568-66/232","page_number":66,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"4fe13de7-9099-4047-9a0b-bb7d4377d8b7","block_type":"box","text":"Investment in non-dollar denominated securities including securities from issuers located in emerging market","page_number":67,"box":{"x":102,"y":45,"width":778,"height":11}},{"id":"0c5b2e1b-13d0-4d23-baa2-a8266293c358","block_type":"box","text":"countries may be on either a currency hedged or unhedged basis, and the Funds may hold from time to time various","page_number":67,"box":{"x":69,"y":60,"width":827,"height":11}},{"id":"b79f6451-f41f-4cfb-91a2-adafdb267059","block_type":"box","text":"foreign currencies pending investment or conversion into U.S. dollars. Some of these instruments may have the","page_number":67,"box":{"x":68,"y":75,"width":797,"height":11}},{"id":"905389af-bfa4-4110-97b8-a7493297d642","block_type":"box","text":"characteristics of futures contracts. In addition, cer tain Funds may engage in foreign currency exchange transactions","page_number":67,"box":{"x":69,"y":90,"width":832,"height":11}},{"id":"0574b302-ec5f-44bc-8de4-9d3b520bc719","block_type":"box","text":"to seek to protect against changes in the level of future exchange rates which would adversely affect the Fund’s","page_number":67,"box":{"x":68,"y":105,"width":799,"height":11}},{"id":"ad01ae37-602c-4afc-ab7b-aa042b0fe270","block_type":"box","text":"per formance. These investments and transactions involving foreign securities, currencies, options (including options","page_number":67,"box":{"x":70,"y":120,"width":829,"height":12}},{"id":"79fa96ac-54d9-461a-8882-e0ce3781f86e","block_type":"box","text":"that relate to foreign currencies), futures, hedging and cross-hedging are described under “Derivatives.”","page_number":67,"box":{"x":68,"y":135,"width":740,"height":12}},{"id":"dbea54c0-9970-40f3-9990-9859e7ff74be","block_type":"box","text":"Risks of Investing in Asia-Pacific Countries.","page_number":67,"box":{"x":102,"y":158,"width":305,"height":11}},{"id":"cf371c05-5a67-4fee-b11f-c4c7fea74ade","block_type":"box","text":"In addition to the risks of foreign investing and the risks of investing","page_number":67,"box":{"x":414,"y":158,"width":485,"height":11}},{"id":"a54d1635-4410-4f09-bd31-23b33be9119d","block_type":"box","text":"in developing markets, the developing market Asia-Pacific countries in which a Fund may invest are subject to cer tain","page_number":67,"box":{"x":70,"y":173,"width":832,"height":11}},{"id":"275ed355-e20d-46dc-83b3-5cd21d3e83bf","block_type":"box","text":"additional or specific risks. Cer tain Funds may make substantial investments in Asia-Pacific countries. In many of","page_number":67,"box":{"x":69,"y":188,"width":808,"height":11}},{"id":"5842b0b6-46f1-4c79-8545-c0f65bcfd30f","block_type":"box","text":"these markets, there is a high concentration of market capitalization and trading volume in a small number of issuers","page_number":67,"box":{"x":68,"y":203,"width":838,"height":12}},{"id":"2cafce54-7ca1-46fc-9e21-88e7a8449ab4","block_type":"box","text":"representing a limited number of industries, as well as a high concentration of investors and financial intermediaries.","page_number":67,"box":{"x":69,"y":218,"width":834,"height":12}},{"id":"6274825c-6f6c-419d-8afe-0fb5574fb049","block_type":"box","text":"Many of these markets also may be affected by developments with respect to more established markets in the","page_number":67,"box":{"x":70,"y":234,"width":791,"height":11}},{"id":"59f3d226-aa53-400c-a15d-ccd9f0cd1dc3","block_type":"box","text":"region such as in Japan and Hong Kong. Brokers in developing market Asia-Pacific countries typically are fewer in","page_number":67,"box":{"x":69,"y":249,"width":804,"height":11}},{"id":"9caed5b9-ec1b-45ee-b337-2b1c191d925b","block_type":"box","text":"number and less well capitalized than brokers in the United States. These factors, combined with the U.S. regulatory","page_number":67,"box":{"x":69,"y":264,"width":833,"height":11}},{"id":"2fa129ae-0d6b-43c5-8483-93b551493e2e","block_type":"box","text":"requirements for open-end investment companies and the restrictions on foreign investment discussed below, result","page_number":67,"box":{"x":69,"y":279,"width":830,"height":11}},{"id":"8ca2753e-5a7e-4766-b64c-00f681ea9af9","block_type":"box","text":"in potentially fewer investment oppor tunities for a Fund and may have an adverse impact on the investment","page_number":67,"box":{"x":70,"y":294,"width":766,"height":11}},{"id":"415066df-3a14-4ca3-b62b-02d41cc6d762","block_type":"box","text":"per formance of the Fund.","page_number":67,"box":{"x":70,"y":309,"width":179,"height":11}},{"id":"58fe7981-7a74-49fc-8062-70c6d8ef998b","block_type":"box","text":"Many of the developing market Asia-Pacific countries may be subject to a greater degree of economic, political","page_number":67,"box":{"x":102,"y":332,"width":784,"height":11}},{"id":"04db1236-f314-410f-a0a4-12235c334ba8","block_type":"box","text":"and social instability than is the case in the United States and Western European countries. Such instability may","page_number":67,"box":{"x":69,"y":347,"width":803,"height":11}},{"id":"9271474f-eaa5-4a56-ae5c-a424f6121bf3","block_type":"box","text":"result from, among other things: (i) authoritarian governments or military involvement in political and economic","page_number":67,"box":{"x":69,"y":362,"width":788,"height":11}},{"id":"d4115402-c4b6-4711-9a1e-9a1ec45cb652","block_type":"box","text":"decision-making, including changes in government through extra-constitutional means; (ii) popular unrest associated","page_number":67,"box":{"x":69,"y":377,"width":827,"height":12}},{"id":"5165a98a-51bb-4807-aef0-cf9cba75a0d6","block_type":"box","text":"with demands for improved political, economic and social conditions; (iii) internal insurgencies; (iv) hostile relations","page_number":67,"box":{"x":68,"y":392,"width":823,"height":12}},{"id":"8ddab7cb-4599-4fc9-b0be-69aa4a8e0bef","block_type":"box","text":"with neighboring countries; and (v) ethnic, religious and racial disaffection. In addition, the governments of many of","page_number":67,"box":{"x":68,"y":407,"width":822,"height":12}},{"id":"51cd89b7-9e62-46f6-97c4-55788c47e691","block_type":"box","text":"such countries, such as Indonesia, have a substantial role in regulating and supervising the economy. Another risk","page_number":67,"box":{"x":69,"y":423,"width":818,"height":11}},{"id":"7a6c1c5e-7a1a-4595-880f-8c8780bbdcb9","block_type":"box","text":"common to most such countries is that the economy is heavily expor t oriented and, accordingly, is dependent upon","page_number":67,"box":{"x":69,"y":438,"width":821,"height":11}},{"id":"a5f338e0-1d69-4aba-a910-a461445c2f48","block_type":"box","text":"international trade. The existence of overburdened infrastructure and obsolete financial systems also presents risks","page_number":67,"box":{"x":70,"y":453,"width":827,"height":11}},{"id":"646125bc-edf2-4923-9dc3-89374964ead1","block_type":"box","text":"in cer tain countries, as do environmental problems. Cer tain economies also depend to a significant degree upon","page_number":67,"box":{"x":70,"y":468,"width":803,"height":11}},{"id":"1946612c-1655-4158-9ff6-c3b4963818a5","block_type":"box","text":"expor ts of primary commodities and, therefore, are vulnerable to changes in commodity prices that, in turn, may be","page_number":67,"box":{"x":69,"y":483,"width":824,"height":11}},{"id":"16ae010d-6594-4e90-9e4e-a9a1968d2c52","block_type":"box","text":"affected by a variety of factors.","page_number":67,"box":{"x":69,"y":498,"width":220,"height":11}},{"id":"085dc7db-7b49-47c4-8c01-dc43d452e14a","block_type":"box","text":"The legal systems in cer tain developing market Asia-Pacific countries also may have an adverse impact on the","page_number":67,"box":{"x":101,"y":521,"width":785,"height":11}},{"id":"c55c07d0-0618-444e-a105-065bc2ece801","block_type":"box","text":"Fund. For example, while the potential liability of a shareholder in a U.S. corporation with respect to acts of the","page_number":67,"box":{"x":70,"y":536,"width":789,"height":11}},{"id":"3cd4eaca-0599-49a2-85f5-772e6caeb9e8","block_type":"box","text":"corporation is generally limited to the amount of the shareholder’s investment, the notion of limited liability is less","page_number":67,"box":{"x":69,"y":551,"width":814,"height":11}},{"id":"858fdb67-ba3d-49a0-91af-8154d3292208","block_type":"box","text":"clear in cer tain emerging market Asia-Pacific countries. Similarly, the rights of investors in developing market Asia","page_number":67,"box":{"x":69,"y":566,"width":813,"height":11}},{"id":"381c78b7-178a-428b-9343-8bfc309f4ba9","block_type":"box","text":"Pacific companies may be more limited than those of shareholders of U.S. corporations. It may be difficult or","page_number":67,"box":{"x":69,"y":581,"width":777,"height":11}},{"id":"56e471b0-b8ac-4493-b05f-ef05af6d4a01","block_type":"box","text":"impossible to obtain and/or enforce a judgment in a developing market Asia-Pacific country.","page_number":67,"box":{"x":70,"y":596,"width":652,"height":12}},{"id":"cbb0754e-752a-45cc-89d8-b86c4dc2302a","block_type":"box","text":"Governments of many developing market Asia-Pacific countries have exercised and continue to exercise","page_number":67,"box":{"x":102,"y":619,"width":737,"height":11}},{"id":"8f70aff0-8b2d-4c76-a6d8-494e88b0c1ae","block_type":"box","text":"substantial influence over many aspects of the private sector. In cer tain cases, the government owns or controls","page_number":67,"box":{"x":69,"y":634,"width":803,"height":12}},{"id":"787b65d1-5f35-4c02-a8d8-c0b8b1745f0b","block_type":"box","text":"many companies, including the largest in the country. Accordingly, government actions in the future could have a","page_number":67,"box":{"x":69,"y":649,"width":801,"height":12}},{"id":"9edafd4e-93ba-411a-ba3f-7d8b532651e5","block_type":"box","text":"significant effect on economic conditions in developing market Asia-Pacific countries, which could affect private","page_number":67,"box":{"x":69,"y":664,"width":793,"height":12}},{"id":"4f14ee87-f42a-47bf-8c19-3500b11158a1","block_type":"box","text":"sector companies and a Fund itself, as well as the value of securities in the Fund’s por tfolio. In addition, economic","page_number":67,"box":{"x":69,"y":680,"width":820,"height":11}},{"id":"a463cd26-c009-4ceb-ae20-7f8e5511daf5","block_type":"box","text":"statistics of developing market Asia-Pacific countries may be less reliable than economic statistics of more developed","page_number":67,"box":{"x":69,"y":695,"width":839,"height":11}},{"id":"fbe2f184-a253-48d1-a13b-1dd087e267fa","block_type":"box","text":"nations.","page_number":67,"box":{"x":69,"y":710,"width":56,"height":9}},{"id":"b72802b2-88c1-4fe5-8fa0-049226f79b22","block_type":"box","text":"In addition to the relative lack of publicly available information about developing market Asia-Pacific issuers and","page_number":67,"box":{"x":102,"y":732,"width":794,"height":12}},{"id":"b92e26d8-0f16-4e93-a8a4-716d34e043eb","block_type":"box","text":"the possibility that such issuers may not be subject to the same accounting, auditing and financial repor ting","page_number":67,"box":{"x":68,"y":748,"width":773,"height":11}},{"id":"0ed7281e-6ec1-4eb7-b799-06e1772cc053","block_type":"box","text":"standards as U.S. companies, inflation accounting rules in some developing market Asia-Pacific countries require","page_number":67,"box":{"x":69,"y":763,"width":808,"height":11}},{"id":"20430ef5-4176-4e01-b037-4582098133d7","block_type":"box","text":"companies that keep accounting records in the local currency, for both tax and accounting purposes, to restate","page_number":67,"box":{"x":69,"y":778,"width":791,"height":11}},{"id":"14147298-1037-4a8d-9562-af688fc6d906","block_type":"box","text":"cer tain assets and liabilities on the company’s balance sheet in order to express items in terms of currency of","page_number":67,"box":{"x":69,"y":793,"width":790,"height":11}},{"id":"95a6468b-dfb2-4ba9-a234-d74182e582ec","block_type":"box","text":"constant purchasing power. Inflation accounting may indirectly generate losses or profits for cer tain developing","page_number":67,"box":{"x":69,"y":808,"width":790,"height":11}},{"id":"5359b63b-463a-4eea-ab4f-d6cb518ba5b6","block_type":"box","text":"market Asia-Pacific companies.","page_number":67,"box":{"x":69,"y":823,"width":220,"height":11}},{"id":"2b1629b1-1db7-4166-b882-0ca64f13888c","block_type":"box","text":"Satisfactory custodial services for investment securities may not be available in some developing Asia-Pacific","page_number":67,"box":{"x":102,"y":846,"width":780,"height":11}},{"id":"8db8e0cd-86b5-4eda-8277-18a916cdd488","block_type":"box","text":"countries, which may result in the Fund incurring additional costs and delays in providing transpor tation and custody","page_number":67,"box":{"x":69,"y":861,"width":829,"height":11}},{"id":"106f61af-983e-40f1-a779-ca7200d0d30a","block_type":"box","text":"services for such securities outside such countries.","page_number":67,"box":{"x":69,"y":876,"width":367,"height":9}},{"id":"f57d3191-9dec-497f-961b-56a32c8c40ee","block_type":"box","text":"II-36","page_number":67,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"de091e71-85a1-4c69-85fd-021bb6d8e192","block_type":"box","text":"NM1026U-5982568-67/232","page_number":67,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"4688dfde-a83b-44ad-ba6d-0f759e70ff3a","block_type":"box","text":"Cer tain developing Asia-Pacific countries, such as the Philippines, India and Turkey, are especially large debtors","page_number":68,"box":{"x":102,"y":45,"width":795,"height":11}},{"id":"9fd43e9a-ec27-4a12-894f-6c26a94bdb31","block_type":"box","text":"to commercial banks and foreign governments.","page_number":68,"box":{"x":68,"y":60,"width":335,"height":11}},{"id":"8c57a511-957c-448e-a898-f6aecfa60b92","block_type":"box","text":"Natural disasters in Asia-Pacific countries, and the resulting damage, could have a severe and negative impact","page_number":68,"box":{"x":102,"y":82,"width":788,"height":12}},{"id":"1086cb9a-fa06-4e29-b1bd-6ff5d11bc81d","block_type":"box","text":"on a Fund’s investment por tfolio and, in the longer term, could impair the ability of issuers in which the Fund invests","page_number":68,"box":{"x":69,"y":98,"width":830,"height":11}},{"id":"0ff0f7d4-38f0-4d01-b45f-741ca2530a24","block_type":"box","text":"to conduct their businesses in the manner normally conducted.","page_number":68,"box":{"x":68,"y":113,"width":450,"height":11}},{"id":"b7f012fa-db5c-46f7-b681-3dc0af848504","block_type":"box","text":"Fund management may determine that, notwithstanding otherwise favorable investment criteria, it may not be","page_number":68,"box":{"x":102,"y":135,"width":782,"height":12}},{"id":"8a2e845f-a34e-4f9b-bd87-bf42a8486e2d","block_type":"box","text":"practicable or appropriate to invest in a par ticular developing Asia-Pacific country. A Fund may invest in countries in","page_number":68,"box":{"x":70,"y":150,"width":819,"height":12}},{"id":"a3a5a8e6-2be6-4bbf-a359-9fd01bd4a9eb","block_type":"box","text":"which foreign investors, including management of the Fund, have had no or limited prior experience.","page_number":68,"box":{"x":68,"y":166,"width":711,"height":11}},{"id":"4e9aebc3-f9dd-4f6e-a2da-e9ffbcab85bb","block_type":"box","text":"Restrictions on Foreign Investments in Asia-Pacific Countries.","page_number":68,"box":{"x":102,"y":188,"width":435,"height":12}},{"id":"399f0c5c-7af1-4b70-97da-3fb230e33f39","block_type":"box","text":"Some developing Asia-Pacific countries prohibit or","page_number":68,"box":{"x":543,"y":188,"width":355,"height":12}},{"id":"c18109fa-43d7-4bd9-beab-c8ca364f163d","block_type":"box","text":"impose substantial restrictions on investments in their capital markets, par ticularly their equity markets, by foreign","page_number":68,"box":{"x":70,"y":203,"width":817,"height":12}},{"id":"fb61118f-72ea-4e62-842b-a274ad17afda","block_type":"box","text":"entities such as a Fund. As illustrations, cer tain countries may require governmental approval prior to investments by","page_number":68,"box":{"x":69,"y":219,"width":836,"height":11}},{"id":"001a69e5-4b07-47e9-9c3c-9fb9720b866c","block_type":"box","text":"foreign persons or limit the amount of investment by foreign persons in a par ticular company or limit the investment","page_number":68,"box":{"x":68,"y":234,"width":828,"height":11}},{"id":"7e47063a-6a69-4825-8870-9eee0c698aee","block_type":"box","text":"by foreign persons to only a specific class of securities of a company which may have less advantageous terms","page_number":68,"box":{"x":69,"y":249,"width":794,"height":11}},{"id":"20f98743-5a48-47a3-bddc-5fdfacda2b0d","block_type":"box","text":"(including price and shareholder rights) than securities of the company available for purchase by nationals. There can","page_number":68,"box":{"x":69,"y":264,"width":835,"height":11}},{"id":"7faf7773-3635-4a01-be0f-67ff220a0c42","block_type":"box","text":"be no assurance that a Fund will be able to obtain required governmental approvals in a timely manner. In addition,","page_number":68,"box":{"x":69,"y":279,"width":820,"height":11}},{"id":"947c178d-7e3e-4358-bf1b-7379b63af8a7","block_type":"box","text":"changes to restrictions on foreign ownership of securities subsequent to a Fund’s purchase of such securities may","page_number":68,"box":{"x":69,"y":294,"width":820,"height":11}},{"id":"9cd8808a-1e80-4c34-a16c-611614415401","block_type":"box","text":"have an adverse effect on the value of such shares. Cer tain countries may restrict investment oppor tunities in","page_number":68,"box":{"x":69,"y":309,"width":788,"height":11}},{"id":"17c717c5-c748-4c90-ac9b-f3b2a1ebda76","block_type":"box","text":"issuers or industries deemed impor tant to national interests.","page_number":68,"box":{"x":70,"y":325,"width":434,"height":10}},{"id":"83ed2f01-ad1a-49eb-b5b3-690d41195db7","block_type":"box","text":"The manner in which foreign investors may invest in companies in cer tain developing Asia-Pacific countries, as","page_number":68,"box":{"x":101,"y":347,"width":787,"height":11}},{"id":"1f65d2ca-2e0e-4ff5-97d3-f00ec87f8390","block_type":"box","text":"well as limitations on such investments, also may have an adverse impact on the operations of a Fund. For example,","page_number":68,"box":{"x":68,"y":362,"width":833,"height":11}},{"id":"cf42cee6-d278-40ce-b7be-bb007f614b40","block_type":"box","text":"a Fund may be required in cer tain of such countries to invest initially through a local broker or other entity and then","page_number":68,"box":{"x":69,"y":377,"width":820,"height":12}},{"id":"4862c195-fe48-4b62-aca5-2e4fc10b9cc5","block_type":"box","text":"have the shares purchased re-registered in the name of the Fund. Re-registration may in some instances not be able","page_number":68,"box":{"x":69,"y":392,"width":831,"height":12}},{"id":"c3df9a72-70ca-48ab-909c-71562d0a7ecd","block_type":"box","text":"to occur on a timely basis, resulting in a delay during which a Fund may be denied cer tain of its rights as an investor,","page_number":68,"box":{"x":68,"y":407,"width":834,"height":12}},{"id":"2ee4ad32-be78-4e57-a790-a2443217e9c1","block_type":"box","text":"including rights as to dividends or to be made aware of cer tain corporate actions. There also may be instances where","page_number":68,"box":{"x":70,"y":423,"width":836,"height":11}},{"id":"01b25e7f-4131-47ce-8228-9d00e8ca90f3","block_type":"box","text":"a Fund places a purchase order but is subsequently informed, at the time of re-registration, that the permissible","page_number":68,"box":{"x":69,"y":438,"width":800,"height":11}},{"id":"2b3163de-fa99-4cb8-a4b6-791678509054","block_type":"box","text":"allocation of the investment to foreign investors has been filled, depriving the Fund of the ability to make its desired","page_number":68,"box":{"x":69,"y":453,"width":826,"height":11}},{"id":"35faef41-4283-440b-bb40-03a43ff0d82a","block_type":"box","text":"investment at that time.","page_number":68,"box":{"x":70,"y":468,"width":168,"height":9}},{"id":"bbd6a1a2-1e75-42e8-9397-1c00ba7e9965","block_type":"box","text":"Substantial limitations may exist in cer tain countries with respect to a Fund’s ability to repatriate investment","page_number":68,"box":{"x":102,"y":491,"width":774,"height":11}},{"id":"63935d6a-02ec-44ed-b5be-c2956af1bbda","block_type":"box","text":"income, capital or the proceeds of sales of securities by foreign investors. A Fund could be adversely affected by","page_number":68,"box":{"x":70,"y":506,"width":803,"height":11}},{"id":"42df0db9-0fec-4416-b0b2-387ada054656","block_type":"box","text":"delays in, or a refusal to grant, any required governmental approval for repatriation of capital, as well as by the","page_number":68,"box":{"x":69,"y":521,"width":789,"height":11}},{"id":"76d65ef8-bbde-4943-8104-96d038e205e1","block_type":"box","text":"application to the Fund of any restrictions on investments. It is possible that cer tain countries may impose currency","page_number":68,"box":{"x":69,"y":536,"width":826,"height":11}},{"id":"48a27bbc-c09e-46f0-9170-4f6dae2675e4","block_type":"box","text":"controls or other restrictions relating to their currencies or to securities of issuers in those countries. To the extent","page_number":68,"box":{"x":69,"y":551,"width":818,"height":11}},{"id":"34fc8bcc-cb55-40b5-a728-ffefa7dedc53","block_type":"box","text":"that such restrictions have the effect of making cer tain investments illiquid, securities may not be available for sale","page_number":68,"box":{"x":68,"y":566,"width":826,"height":11}},{"id":"0c06507a-ede8-43f2-80d0-545da3333aa2","block_type":"box","text":"to meet redemptions. Depending on a variety of financial factors, the percentage of a Fund’s por tfolio subject to","page_number":68,"box":{"x":68,"y":581,"width":800,"height":12}},{"id":"da612497-3186-4366-888f-bda343c36e9f","block_type":"box","text":"currency controls may increase. In the event other countries impose similar controls, the por tion of the Fund’s assets","page_number":68,"box":{"x":69,"y":596,"width":839,"height":12}},{"id":"25383d62-79ab-412c-8542-9634bfead3aa","block_type":"box","text":"that may be used to meet redemptions may be fur ther decreased. Even where there is no outright restriction on","page_number":68,"box":{"x":68,"y":612,"width":798,"height":11}},{"id":"78ccd641-6e6f-4ff4-b2b3-f39a514ffb04","block_type":"box","text":"repatriation of capital, the mechanics of repatriation may affect cer tain aspects of the operations of a Fund (for","page_number":68,"box":{"x":69,"y":627,"width":795,"height":11}},{"id":"de39eba6-1b77-451d-81dc-a65aa057a3b3","block_type":"box","text":"example, if funds may be withdrawn only in cer tain currencies and/or only at an exchange rate established by the","page_number":68,"box":{"x":69,"y":642,"width":808,"height":11}},{"id":"7015751c-aff8-4ab2-901b-165d65682b0b","block_type":"box","text":"government).","page_number":68,"box":{"x":68,"y":657,"width":92,"height":11}},{"id":"5570a480-2cf3-4ada-8ba7-fb88980063ad","block_type":"box","text":"In cer tain countries, banks or other financial institutions may be among the leading companies or have actively","page_number":68,"box":{"x":102,"y":680,"width":790,"height":11}},{"id":"3e9ec6ae-3a40-4e5c-9c9a-cf5146160f0d","block_type":"box","text":"traded securities available for investment. The Investment Company Act restricts a Fund’s investments in any equity","page_number":68,"box":{"x":68,"y":695,"width":828,"height":11}},{"id":"8907d51d-86a9-4765-82fa-ec309619b89f","block_type":"box","text":"securities of an issuer that, in its most recent fiscal year, derived more than 15% of its revenues from “securities","page_number":68,"box":{"x":69,"y":710,"width":808,"height":11}},{"id":"7a4cc3b9-c065-4596-8d3b-086d7f63fb7e","block_type":"box","text":"related activities,” as defined by the rules thereunder. These provisions may restrict a Fund’s investments in cer tain","page_number":68,"box":{"x":69,"y":725,"width":829,"height":11}},{"id":"814d7d8d-fa8c-478c-b149-b06c9841813b","block_type":"box","text":"foreign banks and other financial institutions.","page_number":68,"box":{"x":68,"y":740,"width":322,"height":11}},{"id":"4f220844-0d8c-4f6a-8cb4-d91fd3700432","block_type":"box","text":"Political and economic structures in emerging market countries may be undergoing significant evolution and","page_number":68,"box":{"x":102,"y":763,"width":767,"height":11}},{"id":"c46d715b-5ca4-4ab4-8e0c-273e4aa621ff","block_type":"box","text":"rapid development, and these countries may lack the social, political and economic stability characteristic of more","page_number":68,"box":{"x":69,"y":778,"width":814,"height":11}},{"id":"bc991822-3649-4276-9fb9-081286036100","block_type":"box","text":"developed countries. Some of these countries may have in the past failed to recognize private proper ty rights and","page_number":68,"box":{"x":69,"y":793,"width":809,"height":11}},{"id":"36338a9a-7d6c-4b33-831e-acdb3315c92f","block_type":"box","text":"have at times nationalized or expropriated the assets of private companies. As a result the risks described above,","page_number":68,"box":{"x":69,"y":808,"width":812,"height":11}},{"id":"b0018971-c9ea-4495-a165-24123e832808","block_type":"box","text":"including the risks of nationalization or expropriation of assets, may be heightened. In addition, unanticipated political","page_number":68,"box":{"x":70,"y":823,"width":838,"height":12}},{"id":"c6a2a319-1522-4ef4-b51e-3687ec31b8f0","block_type":"box","text":"or social developments may affect the value of investments in these countries and the availability to a Fund of","page_number":68,"box":{"x":69,"y":838,"width":788,"height":11}},{"id":"49f74fce-f0c7-4913-9c81-b948a977d7c3","block_type":"box","text":"additional investments in emerging market countries. The small size and inexperience of the securities markets in","page_number":68,"box":{"x":69,"y":853,"width":812,"height":12}},{"id":"2e84f025-496b-4700-9bd8-692f1f629be0","block_type":"box","text":"cer tain of these countries and the limited volume of trading in securities in these countries may make investments in","page_number":68,"box":{"x":69,"y":869,"width":835,"height":11}},{"id":"f8036a75-c3ac-429c-8103-0a2d05908dc2","block_type":"box","text":"the countries illiquid and more volatile than investments in Japan or most Western European countries. There may be","page_number":68,"box":{"x":68,"y":884,"width":837,"height":11}},{"id":"1cdb1331-d88b-44c7-a291-f6a7de6a8314","block_type":"box","text":"II-37","page_number":68,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"6584f782-f258-47b1-a430-0652b98172f3","block_type":"box","text":"NM1026U-5982568-68/232","page_number":68,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"7a04c1f1-33e8-4e47-9854-fb8a2d1fa5f0","block_type":"box","text":"little financial or accounting information available with respect to issuers located in cer tain emerging market","page_number":69,"box":{"x":70,"y":45,"width":771,"height":11}},{"id":"ff3adf6a-e5ee-4c7d-82df-16c24e7a5446","block_type":"box","text":"countries, and it may be difficult to assess the value or prospects of an investment in such issuers.","page_number":69,"box":{"x":69,"y":60,"width":711,"height":11}},{"id":"8d914e3e-7fbb-41b7-b5fb-82561e25cb90","block_type":"box","text":"The expense ratios of the Funds investing significantly in foreign securities can be expected to be higher than","page_number":69,"box":{"x":101,"y":82,"width":779,"height":12}},{"id":"8feaa955-2f61-417a-a0ac-c4605f054536","block_type":"box","text":"those of Funds investing primarily in domestic securities. The costs attributable to investing abroad are usually higher","page_number":69,"box":{"x":68,"y":98,"width":840,"height":11}},{"id":"297ef746-cb4c-4431-a31c-cf904f2ea66d","block_type":"box","text":"for several reasons, such as the higher cost of custody of foreign securities, higher commissions paid on comparable","page_number":69,"box":{"x":68,"y":113,"width":838,"height":11}},{"id":"dad97e30-329d-4d5c-8c6b-5e71959cd454","block_type":"box","text":"transactions on foreign markets and additional costs arising from delays in settlements of transactions involving","page_number":69,"box":{"x":68,"y":128,"width":802,"height":11}},{"id":"1d665b24-47e9-4c12-88a9-76357d708cd8","block_type":"box","text":"foreign securities.","page_number":69,"box":{"x":68,"y":143,"width":127,"height":11}},{"id":"f7972247-2623-4fc6-8569-e8d247c4672a","block_type":"box","text":"Risks of Investments in Russia.","page_number":69,"box":{"x":102,"y":166,"width":224,"height":9}},{"id":"dabbb15e-79cf-4709-b6dc-b4ecf78ebc29","block_type":"box","text":"A Fund may invest a por tion of its assets in securities issued by companies","page_number":69,"box":{"x":332,"y":166,"width":539,"height":11}},{"id":"6f4ee85f-7b1c-4a9d-9c92-1d07a38db0aa","block_type":"box","text":"located in Russia. The Russian securities market suffers from a variety of problems described above in “Investment","page_number":69,"box":{"x":70,"y":181,"width":826,"height":11}},{"id":"9f5d0d71-14b5-4de8-b64a-38615cc91db6","block_type":"box","text":"in Emerging Markets” not encountered in more developed markets. The Russian securities market is relatively new,","page_number":69,"box":{"x":70,"y":196,"width":821,"height":11}},{"id":"97dabaef-1c47-4a57-9e8c-c932ac3af0ac","block_type":"box","text":"and a substantial por tion of securities transactions in Russia are privately negotiated outside of stock exchanges.","page_number":69,"box":{"x":69,"y":211,"width":812,"height":11}},{"id":"428ad717-5523-4637-aa2b-ff695b07b85e","block_type":"box","text":"The inexperience of the Russian securities market and the limited volume of trading in securities in the market may","page_number":69,"box":{"x":68,"y":226,"width":824,"height":11}},{"id":"1b8442a7-5ea9-42b8-bc9f-67f323f2632a","block_type":"box","text":"make obtaining accurate prices on por tfolio securities from independent sources more difficult than in more","page_number":69,"box":{"x":69,"y":241,"width":771,"height":11}},{"id":"b00e7140-350f-4312-b4af-6bf61f544b3e","block_type":"box","text":"developed markets.","page_number":69,"box":{"x":69,"y":257,"width":138,"height":10}},{"id":"81af2574-88fe-40dc-a2cd-c9c3cbdf92c6","block_type":"box","text":"Because of the underdeveloped state of Russia’s securities markets and banking and telecommunication","page_number":69,"box":{"x":102,"y":279,"width":751,"height":11}},{"id":"4eb45f65-e9f2-41b8-99f9-d074ffad6fe5","block_type":"box","text":"systems, settlement, clearing and registration of securities transactions are subject to additional risks. Prior to 2013,","page_number":69,"box":{"x":69,"y":294,"width":839,"height":11}},{"id":"d0a9a820-3de9-4cd8-b617-a45d454acda0","block_type":"box","text":"there was no central registration system for equity share registration in Russia and registration was carried out either","page_number":69,"box":{"x":68,"y":309,"width":838,"height":11}},{"id":"432873c2-e166-4b3d-bd6f-790009b4c4a5","block_type":"box","text":"by the issuers themselves or by registrars located throughout Russia. These registrars may not have been subject to","page_number":69,"box":{"x":69,"y":325,"width":831,"height":11}},{"id":"19c0545f-afac-4c58-93b2-33cca449da9c","block_type":"box","text":"effective state supervision or licensed with any governmental entity. In 2013, Russia established the National","page_number":69,"box":{"x":69,"y":339,"width":783,"height":12}},{"id":"37887093-fc69-4ec9-909b-b300cf7ba453","block_type":"box","text":"Settlement Depository (“NSD”) as a recognized central securities depository, and title to Russian equities held","page_number":69,"box":{"x":69,"y":355,"width":790,"height":11}},{"id":"36369493-ae0c-490e-9ae7-4e4ff351cc58","block_type":"box","text":"through the NSD is now based on the records of the NSD and not on the records of the local registrars. Although the","page_number":69,"box":{"x":68,"y":370,"width":833,"height":11}},{"id":"f95eaf0b-7255-43ef-8e2c-c3fc1168ac9d","block_type":"box","text":"implementation of the NSD has enhanced the efficiency and transparency of the Russian securities market, loss still","page_number":69,"box":{"x":70,"y":385,"width":831,"height":11}},{"id":"0b2dff9f-fb3c-41c3-ad35-84a784864fac","block_type":"box","text":"can occur. Additionally, issuers and registrars remain prominent in the validation and approval of documentation","page_number":69,"box":{"x":69,"y":400,"width":797,"height":11}},{"id":"cf2ab026-f7e4-4670-a767-41959752ac62","block_type":"box","text":"requirements for corporate action processing in Russia, and, because the documentation requirements and approval","page_number":69,"box":{"x":69,"y":415,"width":832,"height":11}},{"id":"d4c5ba06-f759-481f-beee-81fc69ff1023","block_type":"box","text":"criteria vary between registrars and issuers, there remain inconsistent market standards in the Russian market with","page_number":69,"box":{"x":69,"y":430,"width":827,"height":11}},{"id":"fdc41dc8-1466-47fb-a318-b8843ae8df25","block_type":"box","text":"respect to the completion and submission of corporate action elections. To the extent that a Fund suffers a loss","page_number":69,"box":{"x":69,"y":445,"width":800,"height":11}},{"id":"22efd616-441f-4263-be8b-4294a9489461","block_type":"box","text":"relating to title or corporate actions relating to its por tfolio securities, it may be difficult for the Fund to enforce its","page_number":69,"box":{"x":69,"y":460,"width":813,"height":12}},{"id":"0242f673-6493-491f-8e93-281f7f8c5ce6","block_type":"box","text":"rights or otherwise remedy the loss. Russian securities laws may not recognize foreign nominee accounts held with a","page_number":69,"box":{"x":69,"y":475,"width":836,"height":12}},{"id":"2430342e-956d-43b6-93d7-d6941af3648b","block_type":"box","text":"custodian bank, and as a result the custodian may be considered the ultimate owner of securities held on behalf of","page_number":69,"box":{"x":69,"y":491,"width":824,"height":11}},{"id":"35329ffd-1b30-4b76-a951-fdac1362bc67","block_type":"box","text":"their clients. A Fund also may experience difficulty in obtaining and/or enforcing judgments in Russia.","page_number":69,"box":{"x":68,"y":506,"width":723,"height":11}},{"id":"50a4cc59-350f-4740-8f06-32f34367277f","block_type":"box","text":"In addition, Russia continues to asser t its influence in the region through economic and military measures, as it","page_number":69,"box":{"x":102,"y":528,"width":801,"height":12}},{"id":"ae93936f-65da-4816-a7b8-d913b5db4189","block_type":"box","text":"did with Georgia in the summer of 2008 and the Ukraine in 2014 and 2022. Russia launched a large-scale invasion","page_number":69,"box":{"x":69,"y":543,"width":826,"height":12}},{"id":"f2fdd4aa-342b-4389-b4da-a3a36f7e5495","block_type":"box","text":"of Ukraine on February 24, 2022. The extent and duration of the military action, resulting sanctions and resulting","page_number":69,"box":{"x":69,"y":559,"width":809,"height":11}},{"id":"6a72394b-731a-4a43-8228-93ed13c65e61","block_type":"box","text":"future market disruptions, including declines in its stock markets and the value of the ruble against the U.S. dollar,","page_number":69,"box":{"x":68,"y":574,"width":821,"height":11}},{"id":"0d20f2c8-83d6-421d-bfea-0c79fc94d137","block_type":"box","text":"are impossible to predict. Any such disruptions caused by Russian military action or other actions (including","page_number":69,"box":{"x":69,"y":589,"width":770,"height":11}},{"id":"968ec6b3-180a-481e-9dae-d5cc9c686446","block_type":"box","text":"cyberattacks and espionage) or resulting actual and threatened responses to such activity, including purchasing and","page_number":69,"box":{"x":69,"y":604,"width":827,"height":11}},{"id":"39e3a867-8f08-49e7-9046-f6df9b99b44e","block_type":"box","text":"financing restrictions, boycotts or changes in consumer or purchaser preferences, sanctions, tariffs or cyberattacks","page_number":69,"box":{"x":68,"y":619,"width":824,"height":11}},{"id":"9ac2114a-34c2-4ef9-af45-dba74d4aec7e","block_type":"box","text":"on the Russian government, Russian companies or Russian individuals, including politicians, may impact Russia’s","page_number":69,"box":{"x":69,"y":634,"width":814,"height":12}},{"id":"65c2ee54-897a-4d17-8c98-a9b67c3b64e6","block_type":"box","text":"economy and Russian issuers of securities in which the Fund invests. Actual and threatened responses to such","page_number":69,"box":{"x":69,"y":649,"width":795,"height":12}},{"id":"72a71eda-9587-4f53-b60f-8990db69d06b","block_type":"box","text":"activity, including purchasing restrictions, sanctions, tariffs or cyberattacks on the Russian government or Russian","page_number":69,"box":{"x":69,"y":664,"width":814,"height":12}},{"id":"b700f037-710f-420c-8fdd-40259215b749","block_type":"box","text":"companies, may impact Russia’s economy and Russian issuers of securities in which the Fund invests. Actual and","page_number":69,"box":{"x":69,"y":680,"width":816,"height":11}},{"id":"78117b7c-6567-455e-9e9d-74dc184ca618","block_type":"box","text":"threatened responses to such military action may also impact the markets for cer tain Russian commodities, such as","page_number":69,"box":{"x":68,"y":695,"width":836,"height":11}},{"id":"11f7f52e-98aa-4e66-9397-20f73aef685e","block_type":"box","text":"oil and natural gas, as well as other sectors of the Russian economy, and may likely have collateral impacts on such","page_number":69,"box":{"x":69,"y":710,"width":829,"height":11}},{"id":"73030b0b-ac67-46af-8de0-02888c0aa016","block_type":"box","text":"sectors globally.","page_number":69,"box":{"x":69,"y":725,"width":112,"height":11}},{"id":"b4bda82b-b353-4d74-9963-a91d05b6a603","block_type":"box","text":"Governments in the United States and many other countries (collectively, the “Sanctioning Bodies”) have","page_number":69,"box":{"x":102,"y":748,"width":745,"height":11}},{"id":"4425daab-ec86-4d5d-81ef-58f51a9bf25b","block_type":"box","text":"imposed economic sanctions, which can consist of prohibiting cer tain securities trades, cer tain private transactions","page_number":69,"box":{"x":70,"y":763,"width":826,"height":11}},{"id":"5e0e45ef-aecd-4fab-b34f-c1c2b2cc3dd3","block_type":"box","text":"in the energy sector, asset freezes and prohibition of all business, against cer tain Russian individuals, including","page_number":69,"box":{"x":70,"y":778,"width":799,"height":11}},{"id":"4ae7d92c-aabc-49e9-b13a-0202c3523da9","block_type":"box","text":"politicians, and Russian corporate and banking entities. The Sanctioning Bodies, or others, could also institute","page_number":69,"box":{"x":70,"y":793,"width":788,"height":11}},{"id":"bca3d26e-acb8-41ff-a259-c3862f322d6d","block_type":"box","text":"broader sanctions on Russia, including banning Russia from global payments systems that facilitate cross-border","page_number":69,"box":{"x":69,"y":808,"width":807,"height":11}},{"id":"93b6c449-c4ee-4962-b1ed-909d6b9d8997","block_type":"box","text":"payments. These sanctions, or even the threat of fur ther sanctions, may result in the decline of the value and","page_number":69,"box":{"x":70,"y":823,"width":782,"height":11}},{"id":"b543fb2a-d076-41db-9e27-f144ac62a970","block_type":"box","text":"liquidity of Russian securities, a weakening of the ruble or other adverse consequences to the Russian economy.","page_number":69,"box":{"x":70,"y":838,"width":802,"height":12}},{"id":"16741cea-1d90-492f-a9da-aed60ab81b92","block_type":"box","text":"These sanctions have resulted and may continue to result in the immediate freeze of Russian securities and/or","page_number":69,"box":{"x":68,"y":853,"width":797,"height":12}},{"id":"450d05c1-91dc-493a-ae8a-2ca994991d66","block_type":"box","text":"funds invested in prohibited assets, impairing the ability of a Fund to buy, sell, receive or deliver those securities","page_number":69,"box":{"x":68,"y":869,"width":804,"height":11}},{"id":"0cfba26c-3b0d-4ecd-bef9-1b15c5716a23","block_type":"box","text":"and/or assets. Sanctions could also result in Russia taking counter measures or retaliatory actions which may","page_number":69,"box":{"x":69,"y":884,"width":791,"height":11}},{"id":"26b342cc-4e5a-4095-8cae-9fa6df886138","block_type":"box","text":"fur ther impair the value and liquidity of Russian securities.","page_number":69,"box":{"x":68,"y":899,"width":417,"height":11}},{"id":"f1a782d0-7a2f-4a2f-9a81-98c122dcc43e","block_type":"box","text":"II-38","page_number":69,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"03f77028-90b0-43aa-8c05-f531a0a10a91","block_type":"box","text":"NM1026U-5982568-69/232","page_number":69,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"7b10ba43-7f44-43ed-91b3-f625d3a298e8","block_type":"box","text":"Risks of Investing in Saudi Arabia.","page_number":70,"box":{"x":102,"y":45,"width":241,"height":11}},{"id":"2973d63f-b3a3-4472-8a93-78035976f571","block_type":"box","text":"The ability of foreign investors (such as a Fund) to invest in Saudi Arabian","page_number":70,"box":{"x":350,"y":45,"width":523,"height":11}},{"id":"84e3fa44-e1c9-435d-b93b-5a258a075e74","block_type":"box","text":"issuers is new and untested. Such ability could be restricted or revoked by the Saudi Arabian government at any time,","page_number":70,"box":{"x":70,"y":60,"width":838,"height":11}},{"id":"6f5a1d8d-289c-4697-bc9d-ab25a79d9ca2","block_type":"box","text":"and unforeseen risks could materialize due to foreign ownership in such securities. In addition, the Capital Market","page_number":70,"box":{"x":69,"y":75,"width":814,"height":11}},{"id":"430fe5dc-7f63-4e8c-b0c4-3454d86f0c31","block_type":"box","text":"Authority (“CMA”) places investment limitations on the ownership of Saudi Arabian issuers by foreign investors,","page_number":70,"box":{"x":68,"y":90,"width":793,"height":11}},{"id":"c41b04b3-4ecc-4cb3-b6a5-ec298fd78e1d","block_type":"box","text":"including a limitation on a Fund’s ownership of any single issuer listed on the Saudi Arabian Stock Exchange, which","page_number":70,"box":{"x":70,"y":105,"width":819,"height":11}},{"id":"df915743-e279-46bd-be61-23c6f0d1f95c","block_type":"box","text":"may prevent a Fund from investing in accordance with its strategy and contribute to tracking error against the","page_number":70,"box":{"x":69,"y":120,"width":777,"height":12}},{"id":"dbb8a00f-9d12-43db-81dc-80aa496dd509","block_type":"box","text":"Underlying Index. These restrictions may be changed or new restrictions, such as licensing requirements, special","page_number":70,"box":{"x":70,"y":136,"width":803,"height":11}},{"id":"9149d850-e218-4193-9ebc-f389afe33cb9","block_type":"box","text":"approvals or additional foreign taxes, may be instituted at any time. A Fund may not be able to obtain or maintain any","page_number":70,"box":{"x":69,"y":150,"width":837,"height":12}},{"id":"718c2178-c707-42c1-abee-ac214674ec00","block_type":"box","text":"such licenses or approvals and may not be able to buy and sell securities at full value. Major disruptions or","page_number":70,"box":{"x":69,"y":166,"width":765,"height":11}},{"id":"00203125-b857-4675-8979-b1fba382030c","block_type":"box","text":"regulatory changes could occur in the Saudi Arabian market, any of which could negatively impact a Fund. These risks","page_number":70,"box":{"x":69,"y":181,"width":838,"height":11}},{"id":"6afab863-4616-4363-8539-ae04ad5c26cd","block_type":"box","text":"may be exacerbated, compared to more developed markets, given the limited history of foreign investment in the","page_number":70,"box":{"x":69,"y":196,"width":805,"height":11}},{"id":"ed368dee-f7e5-42dc-a661-a03b5e09cf0d","block_type":"box","text":"Saudi Arabian market. Investments in Saudi Arabia may also be subject to loss due to expropriation or nationalization","page_number":70,"box":{"x":69,"y":211,"width":837,"height":11}},{"id":"0c40314d-f443-40c5-8442-3c02a5358c95","block_type":"box","text":"of assets and proper ty or the imposition of restrictions on additional foreign investments and repatriation of capital.","page_number":70,"box":{"x":69,"y":226,"width":826,"height":11}},{"id":"59af8870-072e-4497-ba14-ebd7a3995632","block_type":"box","text":"Such heightened risks may include, among others, restrictions on and government intervention in international trade,","page_number":70,"box":{"x":69,"y":241,"width":834,"height":11}},{"id":"7d05674d-2e3e-4c2d-b80c-21daf0d91a7c","block_type":"box","text":"confiscatory taxation, political instability, including authoritarian and/or military involvement in governmental decision","page_number":70,"box":{"x":69,"y":256,"width":835,"height":12}},{"id":"c321e7b1-63a2-4778-bc40-dcdfea56ad92","block_type":"box","text":"making, armed conflict, crime and instability as a result of religious, ethnic and/or socioeconomic unrest. Saudi","page_number":70,"box":{"x":69,"y":271,"width":797,"height":12}},{"id":"8cf6dd96-2adf-4a03-bc98-489932574ccc","block_type":"box","text":"Arabia has privatized, or has begun the process of privatizing, cer tain entities and industries. Newly privatized","page_number":70,"box":{"x":68,"y":286,"width":781,"height":12}},{"id":"d048aa18-26c9-4031-aabb-2351ce7e0477","block_type":"box","text":"companies may face strong competition from government-sponsored competitors that have not been privatized. In","page_number":70,"box":{"x":69,"y":302,"width":811,"height":11}},{"id":"fa7753cd-9855-4dc6-b231-9c7d376fd481","block_type":"box","text":"some instances, investors in newly privatized entities have suffered losses due to the inability of the newly privatized","page_number":70,"box":{"x":69,"y":317,"width":833,"height":11}},{"id":"e688ac29-40f0-47da-8105-caaff9dceb21","block_type":"box","text":"entities to adjust quickly to a competitive environment or changing regulatory and legal standards or, in some cases,","page_number":70,"box":{"x":69,"y":332,"width":831,"height":11}},{"id":"785b9033-9b4b-44b0-be40-923f8f04fa34","block_type":"box","text":"due to re-nationalization of such privatized entities. There is no assurance that similar losses will not recur. Fur ther,","page_number":70,"box":{"x":69,"y":347,"width":823,"height":11}},{"id":"18bed514-69f8-46ab-8703-707cb6760f0d","block_type":"box","text":"under income tax laws imposed by the Depar tment of Zakat and Income Tax, dividends paid by a Saudi Arabian","page_number":70,"box":{"x":69,"y":362,"width":791,"height":11}},{"id":"9af08bed-1bbf-4cf9-8f9f-ec28170caaf3","block_type":"box","text":"company to foreign stockholders are generally subject to a 5% withholding tax (different tax rates may apply pursuant","page_number":70,"box":{"x":69,"y":377,"width":835,"height":12}},{"id":"8c8c86dc-4da3-4558-88d6-e31c6966e52a","block_type":"box","text":"to an applicable treaty). Saudi Arabia is highly reliant on income from the sale of petroleum and trade with other","page_number":70,"box":{"x":68,"y":392,"width":799,"height":12}},{"id":"24ac31af-074a-4092-83c8-62a3f19523e4","block_type":"box","text":"countries involved in the sale of petroleum, and its economy is therefore vulnerable to changes in foreign currency","page_number":70,"box":{"x":69,"y":407,"width":815,"height":12}},{"id":"47c93b6c-9aa6-44ba-a6f9-98c3f4cb2fd3","block_type":"box","text":"values and the market for petroleum. As global demand for petroleum fluctuates, Saudi Arabia may be significantly","page_number":70,"box":{"x":68,"y":423,"width":818,"height":11}},{"id":"361794aa-94b4-4fdf-9add-588e75e26da3","block_type":"box","text":"impacted.","page_number":70,"box":{"x":70,"y":438,"width":67,"height":11}},{"id":"6766c9f1-07ce-4e41-8939-0afdbfadf751","block_type":"box","text":"Like most Middle Eastern governments, the government of Saudi Arabia exercises substantial influence over","page_number":70,"box":{"x":102,"y":460,"width":773,"height":12}},{"id":"a91df037-0b85-4b67-9081-b75701b67b63","block_type":"box","text":"many aspects of the private sector. Although liberalization in the wider economy is underway, in many areas it has","page_number":70,"box":{"x":69,"y":475,"width":812,"height":12}},{"id":"61320c4a-a7d9-4845-bab6-bb4c56b8c85b","block_type":"box","text":"lagged significantly: restrictions on foreign ownership persist, and the government has an ownership stake in many","page_number":70,"box":{"x":70,"y":491,"width":818,"height":11}},{"id":"20c2f2e1-674e-486e-9d25-61beda1df362","block_type":"box","text":"key industries. The situation is exacerbated by the fact that Saudi Arabia is governed by an absolute monarchy. Saudi","page_number":70,"box":{"x":69,"y":506,"width":836,"height":11}},{"id":"cf7a4bc0-4e05-49af-b53d-e4ad4a69a534","block_type":"box","text":"Arabia has historically experienced strained relations with economic par tners worldwide, including other countries in","page_number":70,"box":{"x":68,"y":521,"width":826,"height":11}},{"id":"9260b6a8-7db9-4610-8cc1-5f014bd366d5","block_type":"box","text":"the Middle East due to geopolitical events. Incidents involving a Middle Eastern country’s or the region’s security,","page_number":70,"box":{"x":68,"y":536,"width":809,"height":11}},{"id":"9b0090e1-8430-4486-b5a6-3f5b2f025a19","block_type":"box","text":"including terrorism, may cause uncer tainty in their markets and may adversely affect its economy and a Fund’s","page_number":70,"box":{"x":70,"y":551,"width":790,"height":11}},{"id":"e8ab55bb-566f-4e4c-a057-66f6cfbd8e5f","block_type":"box","text":"investments. Governmental actions in the future could have a significant effect on economic conditions in Saudi","page_number":70,"box":{"x":70,"y":566,"width":798,"height":11}},{"id":"6458484f-ee12-44fc-9077-cb2cf7746268","block_type":"box","text":"Arabia, which could affect private sector companies and a Fund, as well as the value of securities in a Fund’s","page_number":70,"box":{"x":68,"y":581,"width":781,"height":11}},{"id":"ea992f58-6071-42d8-a882-7a375a717d60","block_type":"box","text":"por tfolio. Any economic sanctions on Saudi Arabian individuals or Saudi Arabian corporate entities, or even the threat","page_number":70,"box":{"x":70,"y":596,"width":836,"height":12}},{"id":"155ede76-2b9f-4916-bf74-058220ffc8ca","block_type":"box","text":"of sanctions, may result in the decline of the value and liquidity of Saudi Arabian securities, a weakening of the Saudi","page_number":70,"box":{"x":69,"y":612,"width":837,"height":11}},{"id":"57358a4c-56a1-4e32-a891-7b63f86bad96","block_type":"box","text":"riyal or other adverse consequences to the Saudi Arabian economy. In addition, Saudi Arabia’s economy relies heavily","page_number":70,"box":{"x":69,"y":627,"width":838,"height":11}},{"id":"9e43ea17-981a-40e5-85a8-57609e85e899","block_type":"box","text":"on cheap, foreign labor, and changes in the availability of this labor supply could have an adverse effect on the","page_number":70,"box":{"x":69,"y":642,"width":790,"height":11}},{"id":"66191ce6-d1dc-4b3e-9c6c-ab57bd6fd470","block_type":"box","text":"economy.","page_number":70,"box":{"x":69,"y":659,"width":65,"height":9}},{"id":"a76ef174-3cfe-42e8-83f4-1a2bfffaf66e","block_type":"box","text":"The securities markets in Saudi Arabia may not be as developed as those in other countries. As a result,","page_number":70,"box":{"x":101,"y":680,"width":747,"height":11}},{"id":"abe7b144-c25a-45ed-ae84-a09a181637ef","block_type":"box","text":"securities markets in Saudi Arabia are subject to greater risks associated with market volatility, lower market","page_number":70,"box":{"x":69,"y":695,"width":776,"height":11}},{"id":"a087b370-62ac-45bf-8949-69952da3f7d4","block_type":"box","text":"capitalization, lower trading volume, illiquidity, inflation, greater price fluctuations, uncer tainty regarding the existence","page_number":70,"box":{"x":69,"y":710,"width":836,"height":11}},{"id":"9d4c811d-048e-4757-894e-dd5195006fec","block_type":"box","text":"of trading markets, governmental control and heavy regulation of labor and industry. Shares of cer tain Saudi Arabian","page_number":70,"box":{"x":69,"y":725,"width":830,"height":11}},{"id":"97adb3ff-f60d-411e-835b-dae137c819ad","block_type":"box","text":"companies tend to trade less frequently than those of companies on exchanges in more developed markets. Such","page_number":70,"box":{"x":69,"y":740,"width":813,"height":11}},{"id":"8d82daaa-daf1-4b83-8e0b-48993a02bf27","block_type":"box","text":"infrequent trading may adversely affect the pricing of these securities and a Fund’s ability to sell these securities in","page_number":70,"box":{"x":70,"y":755,"width":822,"height":11}},{"id":"62dff787-8241-479f-be26-0eb5cdc932d1","block_type":"box","text":"the future. Current regulations in Saudi Arabian markets may require a Fund to execute trades of securities through a","page_number":70,"box":{"x":68,"y":770,"width":837,"height":12}},{"id":"986bb88e-1382-4c97-b5c6-d227f1518abc","block_type":"box","text":"single broker. As a result, the Manager will have less flexibility to choose among brokers on behalf of a Fund than is","page_number":70,"box":{"x":69,"y":785,"width":826,"height":12}},{"id":"acc75aa6-088b-4987-b95c-83f311f88476","block_type":"box","text":"typically the case for investment managers.","page_number":70,"box":{"x":68,"y":801,"width":309,"height":11}},{"id":"eb042291-4439-4a11-8629-e1df4d2ff304","block_type":"box","text":"Although the political situation in Saudi Arabia is largely stable, Saudi Arabia has historically experienced political","page_number":70,"box":{"x":101,"y":823,"width":806,"height":12}},{"id":"6809d926-1582-427e-806f-6b4b4217c4aa","block_type":"box","text":"instability, and there remains the possibility that the stability will not hold in the future or that instability in the larger","page_number":70,"box":{"x":70,"y":838,"width":828,"height":12}},{"id":"8657a69b-3223-459e-8e13-8496209973d4","block_type":"box","text":"Middle East region could adversely impact the economy of Saudi Arabia. Instability may be caused by military","page_number":70,"box":{"x":70,"y":853,"width":777,"height":12}},{"id":"35894d9f-05b7-46de-8aac-b65c8d11945c","block_type":"box","text":"developments, government interventions in the marketplace, terrorism, extremist attitudes, attempted social or","page_number":70,"box":{"x":69,"y":869,"width":796,"height":11}},{"id":"f4a68a1b-ab8d-450b-9b84-4e00115a45ae","block_type":"box","text":"political reforms, religious differences, or other factors. Additionally, anti-Western views held by cer tain groups in the","page_number":70,"box":{"x":70,"y":884,"width":830,"height":11}},{"id":"4b0e9f21-7a2a-4867-acad-29dafa2a0e28","block_type":"box","text":"Middle East may influence government policies regarding foreign investment. Fur ther developments in U.S. relations","page_number":70,"box":{"x":70,"y":899,"width":827,"height":11}},{"id":"068170c6-7db6-40d1-ac4b-20adcf86054b","block_type":"box","text":"II-39","page_number":70,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"0f8687c2-0a2a-4c6f-9ff5-e4699ae7d24a","block_type":"box","text":"NM1026U-5982568-70/232","page_number":70,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"17f65d8d-fe0d-4cfd-a0f5-746863a2a05f","block_type":"box","text":"with Saudi Arabia and other Middle-Eastern countries may affect these attitudes and policies. The U.S. is a","page_number":71,"box":{"x":68,"y":45,"width":764,"height":11}},{"id":"db602560-5c61-4198-a68a-76b9c42956fc","block_type":"box","text":"significant, and in some cases the most significant, trading par tner of, or foreign investor in, Saudi Arabia. As a","page_number":71,"box":{"x":69,"y":60,"width":795,"height":11}},{"id":"e652104d-c831-4552-95e5-9aa2ea71b48c","block_type":"box","text":"result, economic conditions of Saudi Arabia may be par ticularly affected by changes in the U.S. economy. A decrease","page_number":71,"box":{"x":69,"y":75,"width":835,"height":11}},{"id":"940b5285-d8dd-40cd-b1ca-91a4d62f424c","block_type":"box","text":"in U.S. impor ts or expor ts, new trade and financial regulations or tariffs, changes in the U.S. dollar exchange rate or","page_number":71,"box":{"x":70,"y":90,"width":829,"height":11}},{"id":"fc1cd908-a548-44df-9700-400e26123d5b","block_type":"box","text":"an economic slowdown in the U.S. may have a material adverse effect on the economic conditions of Saudi Arabia","page_number":71,"box":{"x":69,"y":105,"width":815,"height":11}},{"id":"2f78a6e5-89bb-470b-a4af-4713ba117266","block_type":"box","text":"and, as a result, securities to which the Fund has exposure. Political instability in Nor th Africa and the larger Middle","page_number":71,"box":{"x":69,"y":120,"width":825,"height":12}},{"id":"a3f8c529-0b69-48e8-8ec2-0f25b6aa0457","block_type":"box","text":"East region has caused significant disruptions to many industries. Continued political and social unrest in these","page_number":71,"box":{"x":70,"y":135,"width":797,"height":12}},{"id":"f5a0ddc6-5ffe-4b9b-b618-150b611b543b","block_type":"box","text":"areas may negatively affect the value of securities in a Fund’s por tfolio.","page_number":71,"box":{"x":69,"y":150,"width":510,"height":12}},{"id":"d29fe162-fe01-443d-b777-59203d11a082","block_type":"box","text":"Cer tain issuers located in Saudi Arabia may operate in, or have dealings with, countries subject to sanctions","page_number":71,"box":{"x":102,"y":173,"width":773,"height":11}},{"id":"c19336ff-681c-447e-9f0f-d0718599e04f","block_type":"box","text":"and/or embargoes imposed by the U.S. Government and the United Nations and/or countries identified by the U.S.","page_number":71,"box":{"x":69,"y":188,"width":820,"height":12}},{"id":"1b1eb667-0f35-487e-85c9-628c674d4304","block_type":"box","text":"Government as state sponsors of terrorism. As a result, an issuer may sustain damage to its reputation if it is","page_number":71,"box":{"x":69,"y":203,"width":787,"height":12}},{"id":"2974be07-b779-4388-8c5e-da5f9750d2ce","block_type":"box","text":"identified as an issuer which operates in, or has dealings with, such countries. A Fund, as an investor in such issuers","page_number":71,"box":{"x":70,"y":218,"width":837,"height":12}},{"id":"cd6f9abc-817d-42f4-9550-2a0339f2de53","block_type":"box","text":"will be indirectly subject to those risks.","page_number":71,"box":{"x":68,"y":234,"width":277,"height":11}},{"id":"9cf48523-30cd-4d1e-8085-962d58832e2e","block_type":"box","text":"Risks of Investing in Venezuela.","page_number":71,"box":{"x":102,"y":256,"width":223,"height":12}},{"id":"279c75b6-93fd-4d18-8fa3-b38b0c24d8a6","block_type":"box","text":"Investment in Venezuela may subject a Fund to legal, regulatory, political,","page_number":71,"box":{"x":332,"y":257,"width":521,"height":11}},{"id":"4fea7e98-feee-4ea2-a168-ced28dbc8497","block_type":"box","text":"currency, security, expropriation and/or nationalization of assets and economic risk specific to Venezuela. Venezuela","page_number":71,"box":{"x":69,"y":271,"width":829,"height":12}},{"id":"d74d8206-42a0-4adf-a2cc-9b87b13abc9d","block_type":"box","text":"is extremely well endowed with natural resources, including oil and natural gas, and its economy is heavily dependent","page_number":71,"box":{"x":70,"y":287,"width":837,"height":11}},{"id":"ff21ca45-6440-434c-8d5a-210c586e8976","block_type":"box","text":"on expor t of natural resources to key trading par tners. Any act of terrorism, an armed conflict or a breakdown of a","page_number":71,"box":{"x":69,"y":302,"width":813,"height":11}},{"id":"3b6349db-b5b1-4f54-8a3d-4cd0860417a5","block_type":"box","text":"key trading relationship that disrupts the production or expor t of natural resources will likely negatively affect the","page_number":71,"box":{"x":69,"y":317,"width":804,"height":11}},{"id":"8983de28-8918-471e-b316-e27ee1893b14","block_type":"box","text":"Venezuelan economy. The government continues to control key sectors of the economy, including upstream oil and","page_number":71,"box":{"x":68,"y":332,"width":816,"height":11}},{"id":"219efc3c-db69-470e-8fc7-9acf466c4d8a","block_type":"box","text":"gas production, and has sought to increase its role in key sectors, such as telecommunications and steel.","page_number":71,"box":{"x":68,"y":347,"width":758,"height":11}},{"id":"175fdad3-2abd-40ed-89cc-cd2b03a171f7","block_type":"box","text":"Meanwhile, ambiguities in the investment environment remain, such as continued high levels of bureaucracy and","page_number":71,"box":{"x":70,"y":362,"width":803,"height":11}},{"id":"f6aa11d1-27a6-4503-9035-805db38bc519","block_type":"box","text":"corruption, large macroeconomic imbalances, and political and policy uncer tainty. Friction continues between the","page_number":71,"box":{"x":69,"y":377,"width":804,"height":12}},{"id":"851feb8f-a8b5-4f3f-b334-c30a711547b2","block_type":"box","text":"governments of the U.S. and Venezuela. The U.S. has imposed economic sanctions, which consist of asset freezes","page_number":71,"box":{"x":68,"y":392,"width":822,"height":12}},{"id":"fb9db461-7efb-4922-9adf-533d18b2ced5","block_type":"box","text":"and sectoral sanctions, on cer tain Venezuelan individuals and Venezuelan corporate entities, and on the Venezuelan","page_number":71,"box":{"x":69,"y":408,"width":827,"height":10}},{"id":"d6b106d4-98d7-4cc4-b575-300b09fc13a2","block_type":"box","text":"government. The U.S. could also institute broader sanctions on Venezuela. The U.S. has also taken military action","page_number":71,"box":{"x":68,"y":423,"width":814,"height":11}},{"id":"32d783b6-7adb-4da0-a952-fa002b47a3ed","block_type":"box","text":"against Venezuela in an effor t to effect regime change. Military action, sanctions, or even the threat of fur ther","page_number":71,"box":{"x":69,"y":438,"width":787,"height":11}},{"id":"546e30e0-bd07-4cb2-b509-4177b757221f","block_type":"box","text":"military action and sanctions, may result in the decline of the value and liquidity of Venezuelan securities, a","page_number":71,"box":{"x":69,"y":453,"width":766,"height":11}},{"id":"29575747-79a5-4047-aedf-0562ec031d2f","block_type":"box","text":"weakening of the bolivar or other adverse consequences to the Venezuelan economy. These sanctions impair the","page_number":71,"box":{"x":68,"y":468,"width":804,"height":11}},{"id":"b594ba44-65f9-47a3-b191-19c965a5a5a6","block_type":"box","text":"ability of a Fund to buy, sell, receive or deliver those securities and/or assets. Additional sanctions against Venezuela","page_number":71,"box":{"x":69,"y":483,"width":838,"height":11}},{"id":"92550427-978d-439d-9f4c-c89cbfd129c0","block_type":"box","text":"may in the future be imposed by the U.S. or other countries. These factors, among others, can have a negative","page_number":71,"box":{"x":69,"y":498,"width":790,"height":11}},{"id":"3615a520-39de-41d6-af52-806a7a802939","block_type":"box","text":"impact on a Fund’s investments.","page_number":71,"box":{"x":70,"y":514,"width":230,"height":10}},{"id":"0b38ef64-7fe4-427b-b0d5-c94f0895d3a2","block_type":"box","text":"Brady Bonds.","page_number":71,"box":{"x":102,"y":536,"width":92,"height":11}},{"id":"2ddebb22-dea7-4494-85b8-3b5e74362391","block_type":"box","text":"Cer tain Funds may invest in Brady Bonds. A Fund’s emerging market debt securities may include","page_number":71,"box":{"x":201,"y":536,"width":689,"height":11}},{"id":"69c9af16-1b21-4f34-a5fb-b61e6ae88c2f","block_type":"box","text":"emerging market governmental debt obligations commonly referred to as Brady Bonds. Brady Bonds are securities","page_number":71,"box":{"x":69,"y":551,"width":815,"height":11}},{"id":"13bf48a6-76bd-4ed3-8e49-39ec4d7ca1f1","block_type":"box","text":"created through the exchange of existing commercial bank loans to sovereign entities for new obligations in","page_number":71,"box":{"x":69,"y":566,"width":766,"height":11}},{"id":"35b6fe80-1e69-4317-acff-9941180c2e03","block_type":"box","text":"connection with debt restructurings under a debt restructuring plan introduced by former U.S. Secretary of the","page_number":71,"box":{"x":69,"y":581,"width":784,"height":12}},{"id":"5c2056e7-c4c6-4f81-832d-01763b9fb1ee","block_type":"box","text":"Treasury, Nicholas F. Brady (the “Brady Plan”). Brady Plan debt restructurings have been implemented in a number of","page_number":71,"box":{"x":68,"y":596,"width":837,"height":12}},{"id":"0cb71063-5539-4e2b-96b3-05b465b4def0","block_type":"box","text":"countries, including: Argentina, Bolivia, Brazil, Bulgaria, Costa Rica, the Dominican Republic, Ecuador, Jordan, Mexico,","page_number":71,"box":{"x":69,"y":612,"width":839,"height":11}},{"id":"fcfce96e-a216-4e49-807b-ea3697f1a49d","block_type":"box","text":"Niger, Nigeria, Panama, Peru, the Philippines, Poland, Uruguay, Venezuela, and Vietnam. Beginning in the early","page_number":71,"box":{"x":70,"y":627,"width":786,"height":11}},{"id":"f2259903-ab7d-45ea-a635-5994788112bb","block_type":"box","text":"2000s, cer tain countries began retiring their Brady Bonds, including Brazil, Colombia, Mexico, the Philippines, and","page_number":71,"box":{"x":69,"y":642,"width":814,"height":11}},{"id":"67189dbf-3af3-4742-8ffd-71583d027fc6","block_type":"box","text":"Venezuela.","page_number":71,"box":{"x":68,"y":657,"width":75,"height":9}},{"id":"898c6471-3408-4abf-b308-9fbb38807616","block_type":"box","text":"Brady Bonds may be collateralized or uncollateralized, are issued in various currencies (primarily the U.S. dollar)","page_number":71,"box":{"x":102,"y":680,"width":798,"height":11}},{"id":"f699f857-e49f-49d2-8416-4dbd0f996116","block_type":"box","text":"and are actively traded in the OTC secondary market. Brady Bonds are not considered to be U.S. Government","page_number":71,"box":{"x":69,"y":695,"width":780,"height":11}},{"id":"5d9a313a-b2b0-4d57-90d4-02b6a1f522b6","block_type":"box","text":"Securities. U.S. dollar-denominated, collateralized Brady Bonds, which may be fixed rate par bonds or floating rate","page_number":71,"box":{"x":69,"y":710,"width":812,"height":11}},{"id":"6fd7cb6a-9796-43d0-99e2-c61ceb4092ab","block_type":"box","text":"discount bonds, are generally collateralized in full as to principal by U.S. Treasury zero-coupon bonds having the","page_number":71,"box":{"x":69,"y":725,"width":796,"height":11}},{"id":"49c167be-fdad-4c7b-b56d-1956d55f1c55","block_type":"box","text":"same maturity as the Brady Bonds. Interest payments on these Brady Bonds generally are collateralized on a one","page_number":71,"box":{"x":69,"y":740,"width":812,"height":11}},{"id":"b6d42f97-c3d9-4f47-a4a6-6b888dd2f272","block_type":"box","text":"year or longer rolling-forward basis by cash or securities in an amount that, in the case of fixed rate bonds, is equal","page_number":71,"box":{"x":68,"y":755,"width":823,"height":11}},{"id":"859b618e-4985-4162-b5a5-1d9ae86d915d","block_type":"box","text":"to at least one year of interest payments or, in the case of floating rate bonds, initially is equal to at least one year’s","page_number":71,"box":{"x":68,"y":770,"width":833,"height":12}},{"id":"5e574103-2669-42d9-a7f7-09f240336d21","block_type":"box","text":"interest payments based on the applicable interest rate at that time and is adjusted at regular intervals thereafter.","page_number":71,"box":{"x":70,"y":785,"width":816,"height":12}},{"id":"82a239e9-188d-4637-947b-157f2ee2e788","block_type":"box","text":"Cer tain Brady Bonds are entitled to “value recovery payments” in cer tain circumstances, which in effect constitute","page_number":71,"box":{"x":69,"y":801,"width":818,"height":11}},{"id":"14e0a77d-1ab0-49fa-8185-e61def4e9988","block_type":"box","text":"supplemental interest payments but generally are not collateralized. Brady Bonds are often viewed as having three or","page_number":71,"box":{"x":69,"y":816,"width":835,"height":11}},{"id":"eba49829-6d38-4d02-b7b4-6930137cf436","block_type":"box","text":"four valuation components: (i) the collateralized repayment of principal at final maturity; (ii) the collateralized interest","page_number":71,"box":{"x":68,"y":831,"width":832,"height":11}},{"id":"f56ed420-f33b-4981-b432-bed764e33f0c","block_type":"box","text":"payments; (iii) the uncollateralized interest payments; and (iv) any uncollateralized repayment of principal at maturity","page_number":71,"box":{"x":70,"y":846,"width":828,"height":11}},{"id":"354a14c9-249b-4843-9309-1b2353b200e5","block_type":"box","text":"(the uncollateralized amounts constitute the “residual risk”).","page_number":71,"box":{"x":69,"y":861,"width":430,"height":11}},{"id":"e1d05eae-193e-4bc2-b75c-1aa8d2edac9a","block_type":"box","text":"Brady Bonds involve various risk factors described above associated with investing in foreign securities, including","page_number":71,"box":{"x":102,"y":884,"width":807,"height":11}},{"id":"08e3036d-f74a-4fca-bbeb-1114591b7995","block_type":"box","text":"the history of defaults with respect to commercial bank loans by public and private entities of countries issuing Brady","page_number":71,"box":{"x":68,"y":899,"width":838,"height":11}},{"id":"7f120d53-9dc5-4d61-8346-4ac147d74cdb","block_type":"box","text":"II-40","page_number":71,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"fcb2b76f-5c28-4b97-8105-896e3b2f7c64","block_type":"box","text":"NM1026U-5982568-71/232","page_number":71,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"22c822b1-9459-49e8-86e0-b8b707a1caaa","block_type":"box","text":"Bonds. In light of the residual risk of Brady Bonds and, among other factors, the history of defaults, investments in","page_number":72,"box":{"x":70,"y":45,"width":819,"height":11}},{"id":"729ece80-2c8e-4a40-9aa4-b0873802b620","block_type":"box","text":"Brady Bonds are considered speculative. There can be no assurance that Brady Bonds in which the Funds may invest","page_number":72,"box":{"x":70,"y":60,"width":835,"height":11}},{"id":"80e11fa0-22e6-4814-8f0a-a7d28c84a141","block_type":"box","text":"will not be subject to restructuring arrangements or to requests for new credit, which may cause the Funds to suffer a","page_number":72,"box":{"x":68,"y":75,"width":841,"height":11}},{"id":"56a74c80-1eb7-4df7-a9c1-e00f6fa1b93c","block_type":"box","text":"loss of interest or principal on any of its holdings.","page_number":72,"box":{"x":70,"y":90,"width":351,"height":11}},{"id":"42c68288-0f5d-429a-8e79-7a575e5a26d5","block_type":"box","text":"China Investments Risk.","page_number":72,"box":{"x":102,"y":113,"width":171,"height":9}},{"id":"8ef80fc8-2274-4177-92c0-5c8dc5edb37e","block_type":"box","text":"Investments in securities of companies domiciled in the People’s Republic of China (“China” or the “PRC”),","page_number":72,"box":{"x":102,"y":135,"width":763,"height":11}},{"id":"5cd60db7-e1c4-4931-a276-9be43680b512","block_type":"box","text":"including cer tain Hong Kong-listed and U.S.-listed securities, involve a high degree of risk and special considerations","page_number":72,"box":{"x":70,"y":150,"width":830,"height":12}},{"id":"3729b188-ad95-46ce-8f28-41e568a43e5c","block_type":"box","text":"not typically associated with investing in the U.S. securities markets. Such heightened risks include, among others,","page_number":72,"box":{"x":69,"y":166,"width":821,"height":11}},{"id":"d9f9226b-e557-420a-9505-fc9f910d72f2","block_type":"box","text":"an authoritarian government, popular unrest associated with demands for improved political, economic and social","page_number":72,"box":{"x":69,"y":181,"width":809,"height":11}},{"id":"785c676f-635b-4d11-a95a-7c4dd6d99d17","block_type":"box","text":"conditions, the impact of regional conflict on the economy and hostile relations with other countries.","page_number":72,"box":{"x":69,"y":196,"width":713,"height":11}},{"id":"475c3230-acdb-4eba-adbc-2151e6e869ea","block_type":"box","text":"Military conflicts, either in response to internal social unrest or conflicts with other countries, could disrupt","page_number":72,"box":{"x":102,"y":218,"width":762,"height":12}},{"id":"e78d705c-fa1d-49e1-9098-fe0b921100b6","block_type":"box","text":"economic development. The Chinese economy is vulnerable to the long-running disagreements and religious and","page_number":72,"box":{"x":69,"y":234,"width":800,"height":11}},{"id":"e58ec93f-4e92-42ed-98c4-68b8769655c5","block_type":"box","text":"nationalist disputes with Tibet and the Xinjiang region. Since 1997, there have been tensions between the Chinese","page_number":72,"box":{"x":69,"y":249,"width":820,"height":11}},{"id":"e2c8cfab-d489-4a02-996b-af6adfedd5c6","block_type":"box","text":"government and many people in Hong Kong who perceive China as tightening control over Hong Kong’s semi","page_number":72,"box":{"x":68,"y":264,"width":777,"height":11}},{"id":"156d985a-7851-4c5c-8784-56add31daad9","block_type":"box","text":"autonomous liberal political, economic, legal, and social framework. Protests and unrest have increased tensions","page_number":72,"box":{"x":69,"y":279,"width":809,"height":11}},{"id":"ef8c5f64-5fb2-41ed-afdd-b295769708f3","block_type":"box","text":"even fur ther. Due to the interconnected nature of the Hong Kong and Chinese economies, this instability in Hong","page_number":72,"box":{"x":69,"y":294,"width":805,"height":11}},{"id":"d401037b-d71a-43b7-8292-0d11c03266e2","block_type":"box","text":"Kong may cause uncer tainty in the Hong Kong and Chinese markets. China has a complex territorial dispute","page_number":72,"box":{"x":70,"y":309,"width":770,"height":11}},{"id":"7ef22083-1fa1-45fb-81fc-7553eaaba860","block_type":"box","text":"regarding the sovereignty of Taiwan and has made threats of invasion. Taiwan-based companies and individuals are","page_number":72,"box":{"x":69,"y":324,"width":821,"height":12}},{"id":"8ca9f8e9-39bd-47cc-b6e1-6c147e255ad7","block_type":"box","text":"significant investors in China. The continuing hostility between China and Taiwan may have an adverse impact on the","page_number":72,"box":{"x":69,"y":339,"width":831,"height":12}},{"id":"e07242df-70af-47b8-bb1b-bd115d707387","block_type":"box","text":"value of the Fund’s investments in China or Taiwan, may cause a suspension in a Fund’s ability to trade in cer tain","page_number":72,"box":{"x":68,"y":355,"width":812,"height":11}},{"id":"a48a9ede-a135-41c4-be6e-bf9aac3b5299","block_type":"box","text":"securities or other assets or may otherwise make such investments impracticable or impossible. Any escalation of","page_number":72,"box":{"x":69,"y":370,"width":818,"height":11}},{"id":"8b8f0b77-d1fd-46df-a146-f757a4f0e14f","block_type":"box","text":"hostility between China and Taiwan would likely have a significant adverse impact on the value of the Fund’s","page_number":72,"box":{"x":69,"y":385,"width":769,"height":11}},{"id":"deaa65f3-eeeb-4923-b527-47509c246176","block_type":"box","text":"investments in both countries and the region. In addition, China has strained international relations with Japan, India,","page_number":72,"box":{"x":70,"y":400,"width":836,"height":11}},{"id":"da689828-c261-43ea-b7c7-47cda9afcc5e","block_type":"box","text":"the Philippines and other neighbors due to territorial disputes, historical animosities and other defense concerns.","page_number":72,"box":{"x":68,"y":415,"width":810,"height":11}},{"id":"4b1c596e-f0f5-45cc-812c-c72df659db7e","block_type":"box","text":"Frictions between China and the Philippines in the South China Sea pose a risk of escalation potentially leading to","page_number":72,"box":{"x":70,"y":430,"width":813,"height":11}},{"id":"c8f40565-571b-414b-af32-dd23a13dd981","block_type":"box","text":"military conflict. Additionally, China is alleged to have par ticipated in state-sponsored cyberattacks against foreign","page_number":72,"box":{"x":69,"y":445,"width":811,"height":12}},{"id":"957fb19a-90f1-4359-9d5a-a85928ecc51d","block_type":"box","text":"companies and foreign governments. Actual and threatened responses to such activity and strained international","page_number":72,"box":{"x":69,"y":460,"width":804,"height":12}},{"id":"1da19dd9-09c2-4326-a610-77d665d7f4b8","block_type":"box","text":"relations, including purchasing restrictions, sanctions, tariffs or cyberattacks on the Chinese government or Chinese","page_number":72,"box":{"x":69,"y":475,"width":829,"height":12}},{"id":"b8dc75e7-65c5-4f7f-8fbb-7e4c94f07ae8","block_type":"box","text":"companies, may impact China’s economy and Chinese issuers of securities in which a Fund invests. China could be","page_number":72,"box":{"x":69,"y":491,"width":825,"height":11}},{"id":"16978cff-4d65-4bf1-a417-48d8694b317f","block_type":"box","text":"affected by military events on the Korean peninsula or internal instability within Nor th Korea. These situations may","page_number":72,"box":{"x":69,"y":506,"width":819,"height":11}},{"id":"0e00d7e5-138e-4d16-a4ef-66b590e9e13a","block_type":"box","text":"cause uncer tainty in the Chinese market and may adversely affect the per formance of the Chinese economy.","page_number":72,"box":{"x":69,"y":521,"width":776,"height":11}},{"id":"70165d17-74c4-4825-aef6-1d275fd689bb","block_type":"box","text":"The Chinese government has implemented economic reforms in order to liberalize trade policy, promote foreign","page_number":72,"box":{"x":101,"y":543,"width":792,"height":12}},{"id":"deb6809b-1f3f-41fd-8878-d79f0b489776","block_type":"box","text":"investment in the economy, reduce government control of the economy and develop market mechanisms. However,","page_number":72,"box":{"x":70,"y":559,"width":818,"height":11}},{"id":"77116d6f-a98f-4440-b3ff-3ab5ecf570df","block_type":"box","text":"the Chinese government still exercises substantial influence over many aspects of the private sector and may own or","page_number":72,"box":{"x":68,"y":574,"width":835,"height":11}},{"id":"8b77bac4-5042-4e68-90c4-9e070c438f03","block_type":"box","text":"control many companies. Chinese companies, such as those in the financial services or technology sectors, and","page_number":72,"box":{"x":69,"y":589,"width":802,"height":11}},{"id":"23cea501-6f1b-4ee1-975f-61cc9bf69d75","block_type":"box","text":"potentially other sectors in the future, are subject to the risk that Chinese authorities can intervene in their","page_number":72,"box":{"x":70,"y":604,"width":763,"height":11}},{"id":"a649d185-946c-4333-832a-20e6463fbca4","block_type":"box","text":"operations and structure. The Chinese government continues to maintain a major role in economic policymaking and","page_number":72,"box":{"x":69,"y":619,"width":829,"height":11}},{"id":"2d7e5975-6d23-4c41-92fc-1895ec3918dc","block_type":"box","text":"investing in China involves risk of loss due to expropriation, nationalization, confiscation of assets and proper ty or","page_number":72,"box":{"x":70,"y":634,"width":813,"height":12}},{"id":"be87756d-5a9f-4c6d-8665-75d9e23d6887","block_type":"box","text":"the imposition of restrictions on foreign investments and on repatriation of capital invested.","page_number":72,"box":{"x":68,"y":649,"width":653,"height":12}},{"id":"02f917d4-2bf0-4589-b6c0-e1a4458e8d4e","block_type":"box","text":"The Chinese government may intervene in the Chinese financial markets, such as by the imposition of trading","page_number":72,"box":{"x":101,"y":672,"width":783,"height":11}},{"id":"a62c33c1-8144-4ba1-ba78-f4055d92ccde","block_type":"box","text":"restrictions, a ban on “naked” shor t selling or the suspension of shor t selling for cer tain stocks. This may affect","page_number":72,"box":{"x":69,"y":687,"width":805,"height":11}},{"id":"963b9196-2fb7-45db-bf93-0b3946c7ec65","block_type":"box","text":"market price and liquidity of these stocks, and may have an unpredictable impact on the investment activities of the","page_number":72,"box":{"x":69,"y":702,"width":827,"height":11}},{"id":"a5f12903-346c-4fdf-ae1c-d5f79b6e8245","block_type":"box","text":"Funds. Fur thermore, such market interventions may have a negative impact on market sentiment which may in turn","page_number":72,"box":{"x":70,"y":718,"width":821,"height":11}},{"id":"62bba50f-e591-4aec-b67a-72e91df935ad","block_type":"box","text":"affect the per formance of the securities markets and as a result the per formance of the Funds.","page_number":72,"box":{"x":69,"y":732,"width":683,"height":11}},{"id":"40f17430-827e-4353-b842-889f12139159","block_type":"box","text":"In addition, there is less regulation and monitoring of Chinese securities markets and the activities of investors,","page_number":72,"box":{"x":102,"y":755,"width":797,"height":11}},{"id":"ca9fc978-080d-4ea8-96a8-d9e7c4a335d7","block_type":"box","text":"brokers and other par ticipants than in the United States. Accordingly, issuers of securities in China, including","page_number":72,"box":{"x":69,"y":770,"width":779,"height":12}},{"id":"6b8b7006-c333-43d6-aabb-714d9a4e9695","block_type":"box","text":"Chinese companies that are listed on U.S. exchanges, are not subject to the same degree of regulation as are U.S.","page_number":72,"box":{"x":69,"y":785,"width":822,"height":12}},{"id":"0f2ec0e6-42c7-428c-83d9-ef2ac60f7858","block_type":"box","text":"issuers with respect to such matters as insider trading rules, tender offer regulation, accounting standards or auditor","page_number":72,"box":{"x":70,"y":801,"width":836,"height":11}},{"id":"56720b20-356a-48f6-b722-67b1df99e0ea","block_type":"box","text":"oversight, stockholder proxy requirements and the requirements mandating timely and accurate disclosure of","page_number":72,"box":{"x":69,"y":816,"width":778,"height":11}},{"id":"9b71a71b-7f47-4373-9287-e666686d4ee3","block_type":"box","text":"information. Securities markets in China are in the process of change and fur ther development. This may lead to","page_number":72,"box":{"x":70,"y":831,"width":803,"height":11}},{"id":"51738556-f8ee-492f-8f73-a90647396f8c","block_type":"box","text":"trading volatility, difficulty in the settlement and recording of transactions and difficulty in interpreting and applying","page_number":72,"box":{"x":68,"y":846,"width":816,"height":11}},{"id":"bb836d81-3570-436c-9045-61f1a022ce3d","block_type":"box","text":"the relevant regulation. Custodians may not be able to offer the level of service and safe-keeping in relation to the","page_number":72,"box":{"x":68,"y":861,"width":816,"height":11}},{"id":"06c8d163-cfcb-4bfc-83d2-8d4f8b642cec","block_type":"box","text":"settlement and administration of securities in China that is customary in more developed markets. In par ticular,","page_number":72,"box":{"x":69,"y":876,"width":798,"height":11}},{"id":"8b903411-67e9-47b3-9b6f-fa7158b3449c","block_type":"box","text":"there is a risk that a Fund may not be recognized as the owner of securities that are held on behalf of the Fund by a","page_number":72,"box":{"x":68,"y":891,"width":826,"height":12}},{"id":"744c8d00-b81c-4654-871c-a9c57398ae49","block_type":"box","text":"sub-custodian.","page_number":72,"box":{"x":69,"y":907,"width":102,"height":8}},{"id":"44eb3d94-c5f4-4b2f-9023-f43993cd11f6","block_type":"box","text":"II-41","page_number":72,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"7b001728-047c-41c0-9012-de5e3ceeccd0","block_type":"box","text":"NM1026U-5982568-72/232","page_number":72,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"0cde6704-e8f2-4488-8c97-a1e822d76b42","block_type":"box","text":"There may be significant obstacles to obtaining information necessary for investigations into or litigation against","page_number":73,"box":{"x":101,"y":45,"width":801,"height":11}},{"id":"ff377bd4-f575-4866-89a0-72efd09023ac","block_type":"box","text":"Chinese companies, and shareholders may have limited legal remedies. The Funds do not select investments based","page_number":73,"box":{"x":69,"y":60,"width":829,"height":11}},{"id":"65e4fb2a-8e24-452d-a2aa-e45a44278ab6","block_type":"box","text":"on investor protection considerations.","page_number":73,"box":{"x":69,"y":75,"width":268,"height":11}},{"id":"c525ec00-7d80-44f0-84f1-d3f448fcd529","block_type":"box","text":"The Chinese government historically took positions that prevented the U.S. Public Company Accounting Oversight","page_number":73,"box":{"x":101,"y":98,"width":806,"height":11}},{"id":"82bf6e99-d4b7-4371-8221-3bd12fff6727","block_type":"box","text":"Board (“PCAOB”) from inspecting the audit work and practices of accounting firms in mainland China and Hong Kong","page_number":73,"box":{"x":70,"y":113,"width":829,"height":11}},{"id":"649d15ea-440e-4214-b2f5-bd2b193f0832","block_type":"box","text":"for compliance with U.S. law and professional standards. On August 26, 2022, the PCAOB signed a Statement of","page_number":73,"box":{"x":68,"y":128,"width":810,"height":11}},{"id":"1141cb52-6af6-4987-82b7-8d96df9b983e","block_type":"box","text":"Protocol with the China Securities Regulatory Commission and the Ministry of Finance of the PRC, which marked the","page_number":73,"box":{"x":69,"y":143,"width":829,"height":11}},{"id":"b776dd5a-a0a7-4fa6-99be-f8c5f35f3d2c","block_type":"box","text":"first step toward opening access for the PCAOB to inspect and investigate registered public accounting firms","page_number":73,"box":{"x":68,"y":158,"width":774,"height":11}},{"id":"4eaf1594-ec3c-48a8-9057-9a936909c0e4","block_type":"box","text":"headquar tered in mainland China and Hong Kong completely in accordance with U.S. law. However, as this","page_number":73,"box":{"x":69,"y":173,"width":760,"height":11}},{"id":"def63f65-4b9b-4ac7-aa4a-9b3f028da8b0","block_type":"box","text":"development is relatively recent, the implementation of the Statement of Protocol remains to be tested. Audits","page_number":73,"box":{"x":69,"y":188,"width":788,"height":11}},{"id":"1a74c80e-81cc-4a85-8721-a496aa1eb350","block_type":"box","text":"per formed by PCAOB-registered accounting firms in mainland China and Hong Kong may be less reliable than those","page_number":73,"box":{"x":70,"y":203,"width":822,"height":12}},{"id":"41a06e44-70b8-4a37-8431-d6263a1835d6","block_type":"box","text":"per formed by firms subject to PCAOB inspection. Accordingly, information about the Chinese securities in which the","page_number":73,"box":{"x":70,"y":218,"width":821,"height":12}},{"id":"bc0ba397-7177-4fe1-b292-9a906029c241","block_type":"box","text":"Funds invest may be less reliable or complete. Under amendments to the Sarbanes-Oxley Act enacted in December","page_number":73,"box":{"x":70,"y":234,"width":820,"height":11}},{"id":"e0e82a95-7fbf-4dd4-9528-b7a73a7a683c","block_type":"box","text":"2020, which requires that the PCAOB be permitted to inspect the accounting firm of a U.S.-listed Chinese issuer,","page_number":73,"box":{"x":69,"y":249,"width":805,"height":11}},{"id":"7b1d208c-8dae-4232-9ff6-ff717bc32441","block_type":"box","text":"Chinese companies with securities listed on U.S. exchanges may be delisted if the PCAOB is unable to inspect the","page_number":73,"box":{"x":69,"y":264,"width":816,"height":11}},{"id":"7bd40b65-9d27-4e9e-97f3-662d6b806706","block_type":"box","text":"accounting firm.","page_number":73,"box":{"x":69,"y":279,"width":112,"height":11}},{"id":"14d7d146-3763-4b56-b6a4-2f3dbc883052","block_type":"box","text":"The Renminbi (“RMB”) is currently not a freely conver tible currency and is subject to foreign exchange control","page_number":73,"box":{"x":101,"y":302,"width":780,"height":11}},{"id":"7afd6de9-d0d5-48ae-87aa-12f265c39723","block_type":"box","text":"policies and repatriation restrictions imposed by the Chinese government. The imposition of currency controls may","page_number":73,"box":{"x":70,"y":317,"width":815,"height":11}},{"id":"c71cfe2b-191a-413c-8747-382148b0fbea","block_type":"box","text":"negatively impact per formance and liquidity of the Funds as capital may become trapped in the PRC. The Funds could","page_number":73,"box":{"x":69,"y":332,"width":837,"height":11}},{"id":"f8aba58b-712c-4c2d-9961-0f52ca976719","block_type":"box","text":"be adversely affected by delays in, or a refusal to grant, any required governmental approval for repatriation of","page_number":73,"box":{"x":69,"y":347,"width":787,"height":11}},{"id":"0a4596cf-2e92-4018-877e-86cce30112cc","block_type":"box","text":"capital, as well as by the application to the Funds of any restrictions on investments. Investing in entities either in, or","page_number":73,"box":{"x":69,"y":362,"width":837,"height":11}},{"id":"94944cc6-11a0-4953-b769-f394629ece6f","block_type":"box","text":"which have a substantial por tion of their operations in, the PRC may require the Funds to adopt special procedures,","page_number":73,"box":{"x":68,"y":377,"width":825,"height":11}},{"id":"55c264ce-0bca-45ad-a00c-27155097e0ea","block_type":"box","text":"seek local government approvals or take other actions, each of which may involve additional costs and delays to the","page_number":73,"box":{"x":69,"y":392,"width":828,"height":12}},{"id":"5d3b015a-0d42-4ec2-809a-cbb5a65bc700","block_type":"box","text":"Funds. The Fund may also incur costs in connection with conversions between U.S. dollars and RMB, as well as in","page_number":73,"box":{"x":70,"y":408,"width":812,"height":11}},{"id":"e8195f76-a394-42e0-b760-63668ff52edb","block_type":"box","text":"connection with conversions between the two separate types of RMB, the onshore RMB (“CNY”) and the offshore","page_number":73,"box":{"x":69,"y":423,"width":808,"height":11}},{"id":"abda8c34-9f5e-4d3c-a042-5d83710fb32c","block_type":"box","text":"RMB (“CNH”).","page_number":73,"box":{"x":70,"y":438,"width":97,"height":11}},{"id":"e601d478-7fe2-4d90-9567-eb147c119295","block_type":"box","text":"Many Chinese companies listed on U.S. exchanges use variable interest entities or “VIEs” in their structure as a","page_number":73,"box":{"x":102,"y":460,"width":802,"height":12}},{"id":"5b797f8d-4179-463d-8f2d-ca66cd0d9d00","block_type":"box","text":"result of foreign ownership restrictions. In a VIE structure, a Chinese operating company establishes a shell company","page_number":73,"box":{"x":69,"y":475,"width":837,"height":12}},{"id":"cc0d5abc-c121-4d1b-914f-d8c38375f72d","block_type":"box","text":"in another jurisdiction to issue stock to public shareholders. When a VIE structure is used by a Chinese company to","page_number":73,"box":{"x":70,"y":491,"width":822,"height":11}},{"id":"3e451d9c-1bb6-41a4-bda2-9d9260abd31c","block_type":"box","text":"list its stock in the U.S., instead of owning the equity securities of the Chinese company, the U.S.-listed shell","page_number":73,"box":{"x":70,"y":506,"width":775,"height":11}},{"id":"6280e6ee-e5dc-4777-a47d-0a5b2635881e","block_type":"box","text":"company directly or indirectly enters into contracts with the Chinese operating company under Chinese law. These","page_number":73,"box":{"x":69,"y":521,"width":809,"height":11}},{"id":"2d52ca73-f4d7-4c90-9a57-71cf893b2b89","block_type":"box","text":"contracts provide the U.S.-listed shell company with only economic exposure to the Chinese company and do not","page_number":73,"box":{"x":69,"y":536,"width":803,"height":11}},{"id":"07e5b4b9-9110-416c-961b-9aa4c33340fc","block_type":"box","text":"represent equity ownership in the operating company.","page_number":73,"box":{"x":69,"y":551,"width":380,"height":11}},{"id":"4a4760c9-1eb8-4a2c-b900-17230b27d2e7","block_type":"box","text":"While VIEs are a longstanding practice that is well known to Chinese officials and regulators, they have not been","page_number":73,"box":{"x":101,"y":574,"width":801,"height":11}},{"id":"b282adaa-52fe-4cd5-9682-2c1879e13e4c","block_type":"box","text":"formally recognized under Chinese law. The Chinese government has provided guidance to and placed restrictions on","page_number":73,"box":{"x":68,"y":589,"width":833,"height":11}},{"id":"7feabe2c-bef7-4f4f-82e1-e109663e6e26","block_type":"box","text":"Chinese-based companies raising capital offshore, including through VIEs. In 2023, the China Securities Regulatory","page_number":73,"box":{"x":69,"y":604,"width":825,"height":11}},{"id":"baa66735-0643-40aa-86b7-e3e2188ca0ec","block_type":"box","text":"Commission (“CSRC”) released new rules that permit the use of VIE structures, provided they abide by Chinese laws","page_number":73,"box":{"x":69,"y":619,"width":832,"height":11}},{"id":"c6136360-c31e-4182-936a-048aa3a9e507","block_type":"box","text":"and register with the CSRC. The rules, however, may cause Chinese companies to undergo greater scrutiny and add","page_number":73,"box":{"x":69,"y":634,"width":826,"height":12}},{"id":"c201664f-4b00-4577-bc22-966b987d05e8","block_type":"box","text":"costs to VIE structures. Intervention, rulemaking or guidance by the Chinese government with respect to VIE","page_number":73,"box":{"x":69,"y":649,"width":770,"height":12}},{"id":"0ff06a3c-1827-43da-a8d8-796b417273e6","block_type":"box","text":"structures or the non-enforcement of VIE-related contractual rights could significantly affect the operating company’s","page_number":73,"box":{"x":69,"y":664,"width":829,"height":12}},{"id":"b955384f-0d25-4ba1-9ef6-ffbc36c5256b","block_type":"box","text":"business in China, the enforceability of the U.S.-listed shell company’s contractual arrangements with the Chinese","page_number":73,"box":{"x":69,"y":680,"width":815,"height":11}},{"id":"35eea397-e7b4-4cd4-9dcb-ea32703c69ae","block_type":"box","text":"company and the value of the U.S.-listed stock. Fur ther, the VIE contractual arrangement would likely be subject to","page_number":73,"box":{"x":69,"y":695,"width":815,"height":11}},{"id":"01c2089f-99ec-4f94-989c-259c9d593fd3","block_type":"box","text":"Chinese law and jurisdiction, and remedies available to the U.S.-listed shell company are uncer tain and could be","page_number":73,"box":{"x":69,"y":710,"width":802,"height":11}},{"id":"2c898fd1-e5e7-4077-b47e-926125c9032a","block_type":"box","text":"ineffective. In addition to the risk of government intervention, investments through a VIE structure are subject to the","page_number":73,"box":{"x":70,"y":725,"width":828,"height":11}},{"id":"5b7b17cc-e3eb-4e31-b827-ddfc6d3fd53b","block_type":"box","text":"risk that the China-based company (or its officers, directors, or Chinese equity owners) may breach those contractual","page_number":73,"box":{"x":69,"y":740,"width":833,"height":11}},{"id":"5a7fa975-ceb7-4c82-8973-ee2ea13f650b","block_type":"box","text":"arrangements, or Chinese law changes in a way that adversely affects the enforceability of these arrangements, or","page_number":73,"box":{"x":69,"y":755,"width":819,"height":11}},{"id":"6b5cc235-7a62-4735-9d9b-05f1f88af4b7","block_type":"box","text":"those contracts are otherwise not enforceable under Chinese law, in which case the Fund may suffer significant","page_number":73,"box":{"x":68,"y":770,"width":798,"height":12}},{"id":"62407982-385a-45a3-9d3a-9086ab2ea7f7","block_type":"box","text":"losses on its investments through a VIE structure with little or no recourse available. Any change in the operations of","page_number":73,"box":{"x":70,"y":785,"width":833,"height":12}},{"id":"08a92836-2104-4e7e-9a83-af22c6c19f28","block_type":"box","text":"entities in a VIE structure, the status of VIE contractual arrangements or the legal or regulatory environment in China,","page_number":73,"box":{"x":69,"y":801,"width":837,"height":11}},{"id":"fe63d6ae-5dbc-4453-9b85-cefe6a994664","block_type":"box","text":"generally or with respect to specific industries, could result in significant, and possibly permanent and/or total,","page_number":73,"box":{"x":68,"y":816,"width":792,"height":11}},{"id":"c9848582-1f00-4166-8dba-3757616dcf84","block_type":"box","text":"losses to a Fund.","page_number":73,"box":{"x":70,"y":831,"width":120,"height":9}},{"id":"a126dfb3-42eb-465d-9061-f65faae145ab","block_type":"box","text":"While the Chinese economy has experienced past periods of rapid growth, there is no assurance that such","page_number":73,"box":{"x":101,"y":853,"width":760,"height":12}},{"id":"48f8bf46-6206-49c3-8c63-85534549773f","block_type":"box","text":"growth rates will recur. Other economic challenges for China include indebtedness, weak consumer demand, trade","page_number":73,"box":{"x":68,"y":869,"width":815,"height":11}},{"id":"c2e1ab21-ff71-457e-aacd-ba2ba0905edc","block_type":"box","text":"tensions, and an aging population. China continues to face pressure from its trading par tners over its expor ting of its","page_number":73,"box":{"x":68,"y":884,"width":837,"height":11}},{"id":"ff8dfbee-2cd1-44eb-9e8e-4ce591fde8dc","block_type":"box","text":"excess industrial capacity and overall approach to economic management. China’s economy is heavily dependent on","page_number":73,"box":{"x":69,"y":899,"width":830,"height":11}},{"id":"9de36c3e-2e1f-4531-a344-0318a305ae8c","block_type":"box","text":"II-42","page_number":73,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"757f31bc-93cc-4122-9b9e-ce501e63302e","block_type":"box","text":"NM1026U-5982568-73/232","page_number":73,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"2145bb39-72e3-44dc-8a09-22e88d2476e8","block_type":"box","text":"expor t growth. Reduction in spending on Chinese products and services, supply chain diversification, institution of","page_number":74,"box":{"x":69,"y":45,"width":815,"height":11}},{"id":"03142c3f-8e38-45eb-a4dc-8a61b33eb26d","block_type":"box","text":"additional tariffs, sanctions or other trade barriers (including as a result of heightened trade tensions between China","page_number":74,"box":{"x":69,"y":60,"width":832,"height":11}},{"id":"8c901395-06e2-4eed-b770-18aed97ac00a","block_type":"box","text":"and the United States or in response to actual or alleged Chinese cyber activity) or a downturn in any of the","page_number":74,"box":{"x":69,"y":75,"width":765,"height":11}},{"id":"b826d617-a21c-4ec3-91a2-5d512b69f5a7","block_type":"box","text":"economies of China’s key trading par tners may have an adverse impact on the Chinese economy and the companies","page_number":74,"box":{"x":69,"y":90,"width":833,"height":11}},{"id":"41491eea-e377-4f14-a4dd-4d99b7503d34","block_type":"box","text":"in which a Fund invests. Cer tain Chinese companies (which may change from time to time) are directly or indirectly","page_number":74,"box":{"x":70,"y":105,"width":816,"height":11}},{"id":"5cac918d-0301-49ce-be1c-f8464854cc4d","block_type":"box","text":"subject to economic or trade restrictions imposed by the U.S. or other governments due to national security, human","page_number":74,"box":{"x":69,"y":120,"width":824,"height":12}},{"id":"1b43b792-5b2f-4db5-a7a1-4e6233663e1f","block_type":"box","text":"rights or other concerns of such government. For example, cer tain foreign technology companies are subject to U.S.","page_number":74,"box":{"x":69,"y":135,"width":825,"height":12}},{"id":"6f33db98-2f8d-41fa-866e-a892b9296a11","block_type":"box","text":"expor t controls as those companies are believed to pose a risk to U.S. interests. The U.S. also bans impor ts of","page_number":74,"box":{"x":69,"y":150,"width":798,"height":11}},{"id":"c8c456a8-d25d-4491-bae0-493cc3d864a6","block_type":"box","text":"goods produced in cer tain regions of China or by cer tain Chinese companies due to concerns about forced labor.","page_number":74,"box":{"x":68,"y":166,"width":805,"height":11}},{"id":"6d0ec0d2-37c3-42cb-833f-b4500d5c8b59","block_type":"box","text":"Such restrictions may have unanticipated and adverse effects on the Chinese economy and companies. Any action","page_number":74,"box":{"x":69,"y":181,"width":817,"height":11}},{"id":"ad1d89f5-e62d-40c2-abb5-e68d072a35d6","block_type":"box","text":"that targets Chinese financial markets or securities exchanges could inter fere with orderly trading, delay settlement","page_number":74,"box":{"x":68,"y":196,"width":825,"height":11}},{"id":"fc39160c-3de7-43f2-81ee-9b7898cf4a13","block_type":"box","text":"or cause market disruptions. Cer tain companies may be subject to economic or trade restrictions (but not investment","page_number":74,"box":{"x":69,"y":211,"width":839,"height":11}},{"id":"fb685868-c93c-4db2-9bd0-4941887eb265","block_type":"box","text":"restrictions) imposed by the U.S. or other governments due to national security, human rights or other concerns of","page_number":74,"box":{"x":69,"y":226,"width":815,"height":11}},{"id":"ddecff69-cf25-4484-a6b5-a7d2cb74cd25","block_type":"box","text":"such government. So long as these restrictions do not include restrictions on investments, the Fund may invest in","page_number":74,"box":{"x":69,"y":241,"width":812,"height":11}},{"id":"90c3b104-1f56-4319-89e1-838de04ec271","block_type":"box","text":"such companies.","page_number":74,"box":{"x":69,"y":257,"width":119,"height":10}},{"id":"2c41faf2-8d15-43d7-a892-8a9df81162c6","block_type":"box","text":"The tax laws and regulations in the PRC are subject to change, including the issuance of authoritative guidance","page_number":74,"box":{"x":101,"y":279,"width":792,"height":11}},{"id":"6d2d0699-d575-45f4-9478-81fa9f02198a","block_type":"box","text":"or enforcement, possibly with retroactive effect. The interpretation, applicability and enforcement of such laws by PRC","page_number":74,"box":{"x":69,"y":294,"width":840,"height":11}},{"id":"18229dae-ed6a-4793-8019-b6467b6975d3","block_type":"box","text":"tax authorities are not as consistent and transparent as those of more developed nations, and may vary over time","page_number":74,"box":{"x":68,"y":309,"width":815,"height":11}},{"id":"e06b3462-5cb2-4016-b3e7-5e9688eb20b1","block_type":"box","text":"and from region to region. The application and enforcement of PRC tax rules could have a significant adverse effect","page_number":74,"box":{"x":69,"y":324,"width":823,"height":12}},{"id":"af86d30c-dbb0-4c1b-ab85-ae13f13657f5","block_type":"box","text":"on a Fund and its investors, par ticularly in relation to capital gains withholding tax imposed upon non-residents. In","page_number":74,"box":{"x":69,"y":340,"width":812,"height":11}},{"id":"b434e689-d6ed-4450-9e9f-bf58e626d5ee","block_type":"box","text":"addition, the accounting, auditing and financial repor ting standards and practices applicable to Chinese companies","page_number":74,"box":{"x":69,"y":355,"width":821,"height":11}},{"id":"b60c8e5f-8b95-4ee5-b114-b0cd45b78782","block_type":"box","text":"may be less rigorous, and may result in significant differences between financial statements prepared in accordance","page_number":74,"box":{"x":69,"y":370,"width":832,"height":11}},{"id":"1c79d36c-1b4f-480c-a438-90297fbf2554","block_type":"box","text":"with PRC accounting standards and practice and those prepared in accordance with international accounting","page_number":74,"box":{"x":68,"y":385,"width":773,"height":11}},{"id":"07dffc38-4772-42c1-8e4d-1bd5bc1a00ae","block_type":"box","text":"standards.","page_number":74,"box":{"x":69,"y":400,"width":74,"height":9}},{"id":"7b55ea43-4d3f-4998-8452-0b30f8dc5f6a","block_type":"box","text":"From time to time and in recent years, China has experienced outbreaks of infectious illnesses and the country","page_number":74,"box":{"x":102,"y":423,"width":794,"height":11}},{"id":"1e46b310-e5e9-40de-8fe9-2c6ce253d67a","block_type":"box","text":"may be subject to other public health threats, infectious illnesses, diseases or similar issues in the future. Any","page_number":74,"box":{"x":69,"y":438,"width":792,"height":11}},{"id":"30707821-6d5c-4320-9fff-133414c5bdae","block_type":"box","text":"spread of an infectious illness, public health threat or similar issue could reduce consumer demand or economic","page_number":74,"box":{"x":69,"y":453,"width":803,"height":11}},{"id":"64fd6637-bc47-4fd6-bafa-4d7abed96ec6","block_type":"box","text":"output, result in market closures, travel restrictions or quarantines, and generally have a significant impact on the","page_number":74,"box":{"x":69,"y":468,"width":811,"height":11}},{"id":"c71792cf-e3ae-4139-9f93-220d37c5dd63","block_type":"box","text":"Chinese economy, which in turn could adversely affect a Fund’s investments.","page_number":74,"box":{"x":69,"y":483,"width":548,"height":11}},{"id":"d0f60dc8-9fd8-4b5d-b46e-3f10ca8eefd6","block_type":"box","text":"Risk of Investing through Stock Connect.","page_number":74,"box":{"x":102,"y":506,"width":288,"height":11}},{"id":"4b246dcc-d618-41db-bea6-0732756065f8","block_type":"box","text":"General","page_number":74,"box":{"x":102,"y":529,"width":55,"height":8}},{"id":"a663c615-0cc8-40ff-8eff-885a0081abf2","block_type":"box","text":". China A-shares are equity securities of companies domiciled in China that trade on Chinese stock","page_number":74,"box":{"x":158,"y":528,"width":704,"height":12}},{"id":"a52cecbd-c26d-4623-b179-65f656515ec7","block_type":"box","text":"exchanges such as the Shanghai Stock Exchange (“SSE”), the Shenzhen Stock Exchange (“SZSE”) and the Beijing","page_number":74,"box":{"x":69,"y":544,"width":815,"height":11}},{"id":"7a7acd5b-4ae0-4824-b4e9-0fcd3f637259","block_type":"box","text":"Stock Exchange (“BSE”) (“A-shares”). Foreign investment in A-shares on the SSE and SZSE is not permitted, other","page_number":74,"box":{"x":69,"y":559,"width":815,"height":11}},{"id":"5952c75f-4287-4ddb-b823-fe488f4c1322","block_type":"box","text":"than pursuant to available exceptions, such as through a qualified foreign investor approved pursuant to the relevant","page_number":74,"box":{"x":68,"y":574,"width":833,"height":11}},{"id":"1c8cf2d6-b864-40b6-9239-c999c2d83bac","block_type":"box","text":"mainland China laws and regulations as may be promulgated and/or amended from time to time (“QFI”).","page_number":74,"box":{"x":69,"y":589,"width":744,"height":11}},{"id":"bca5172f-6abf-4052-9f6e-1318d453feb3","block_type":"box","text":"Investment in eligible exchange traded funds and A-shares listed and traded on the SSE or SZSE (“Stock","page_number":74,"box":{"x":102,"y":612,"width":745,"height":11}},{"id":"0eeeeab7-85ad-4442-81da-caad16711e38","block_type":"box","text":"Connect Securities”) is also permitted through the Shanghai-Hong Kong Stock Connect program or the Shenzhen","page_number":74,"box":{"x":69,"y":627,"width":807,"height":11}},{"id":"4a7f9728-fea7-429c-9345-aaf432487342","block_type":"box","text":"Hong Kong Stock Connect program, as applicable (each, a “Stock Connect” and collectively, “Stock Connects”). Each","page_number":74,"box":{"x":70,"y":642,"width":834,"height":11}},{"id":"f2f192bd-b627-49a8-8a94-154dcf9982b5","block_type":"box","text":"Stock Connect is a securities trading and clearing links program established by The Stock Exchange of Hong Kong","page_number":74,"box":{"x":69,"y":657,"width":812,"height":11}},{"id":"9c5af44d-a755-43b2-8a50-96ac859a5ab3","block_type":"box","text":"Limited (“SEHK”), the Hong Kong Securities Clearing Company Limited (“HKSCC”), the SSE or SZSE, as applicable,","page_number":74,"box":{"x":70,"y":672,"width":819,"height":11}},{"id":"a3ab40a6-d661-4a8b-8f66-cfc48f6406d2","block_type":"box","text":"and China Securities Depository and Clearing Corporation Limited (“CSDCC”) that aims to provide mutual stock","page_number":74,"box":{"x":69,"y":687,"width":793,"height":11}},{"id":"64497e00-daf2-4361-ae09-733644b64947","block_type":"box","text":"market access between the PRC and Hong Kong by permitting investors to trade and settle shares on each market","page_number":74,"box":{"x":69,"y":702,"width":818,"height":12}},{"id":"4e85b835-fb8c-4c3b-b7c0-62af0d5fdb20","block_type":"box","text":"through their local securities brokers. Under Stock Connects, a Fund’s trading of Stock Connect Securities listed on","page_number":74,"box":{"x":68,"y":717,"width":824,"height":12}},{"id":"28482b48-7d9b-401d-92e3-f4fe013d03c0","block_type":"box","text":"the SSE or SZSE, as applicable, would be effectuated through its Hong Kong broker and a securities trading service","page_number":74,"box":{"x":68,"y":732,"width":827,"height":12}},{"id":"b89fd8e5-8f70-48ec-97db-d8cb53fcfe41","block_type":"box","text":"company established by SEHK.","page_number":74,"box":{"x":69,"y":748,"width":219,"height":11}},{"id":"cc95040c-b01a-4378-be8d-a7a783cbf6a9","block_type":"box","text":"Although no individual investment quotas or licensing requirements apply to investors in Stock Connect, trading","page_number":74,"box":{"x":101,"y":770,"width":794,"height":12}},{"id":"580c22aa-0420-4785-b598-61cf76002f89","block_type":"box","text":"through a Stock Connect’s Nor thbound Trading Link is subject to daily investment quota limitations which require that","page_number":74,"box":{"x":68,"y":786,"width":839,"height":11}},{"id":"90d23b41-ade9-4035-9d49-6d343ea57a2d","block_type":"box","text":"buy orders for Stock Connect Securities be rejected once the daily quota is exceeded (although a Fund will be","page_number":74,"box":{"x":69,"y":801,"width":779,"height":11}},{"id":"708ecd83-ab62-413e-9944-f20b45fd7f9d","block_type":"box","text":"permitted to sell their Stock Connect Securities regardless of the quota). These limitations may restrict a Fund from","page_number":74,"box":{"x":70,"y":816,"width":824,"height":11}},{"id":"2c39d7b2-8cd3-4ee1-a2f9-f7e17dd6006c","block_type":"box","text":"investing in Stock Connect Securities on a timely basis, which could affect the Fund’s ability to effectively pursue its","page_number":74,"box":{"x":70,"y":831,"width":827,"height":11}},{"id":"eac3fc0d-5b7f-48a1-96b1-e5063cae349d","block_type":"box","text":"investment strategy. Investment quotas are also subject to change. Investment in Stock Connect Securities through a","page_number":74,"box":{"x":70,"y":846,"width":837,"height":11}},{"id":"55d7f3f1-9bd8-40e8-abb2-c4c5e43af433","block_type":"box","text":"Stock Connect is subject to trading, clearance and settlement procedures that could pose risks to a Fund. Stock","page_number":74,"box":{"x":69,"y":861,"width":802,"height":11}},{"id":"1b10cef1-ff59-4153-a671-49ca2afedae3","block_type":"box","text":"Connect Securities purchased through Stock Connects generally may not be sold or otherwise transferred other than","page_number":74,"box":{"x":69,"y":876,"width":831,"height":11}},{"id":"d35bdb56-8aa3-4d93-8d6c-24a16e249d07","block_type":"box","text":"through Stock Connects in accordance with applicable rules. For example, the PRC regulations require that in order","page_number":74,"box":{"x":68,"y":891,"width":821,"height":12}},{"id":"fc9eef2b-0970-4b74-906d-2dbb93610434","block_type":"box","text":"for an investor to sell any Stock Connect Securities on a cer tain trading day, there must be sufficient Stock Connect","page_number":74,"box":{"x":68,"y":906,"width":829,"height":12}},{"id":"17b8a4ac-fd0a-466d-8b86-013c5a857881","block_type":"box","text":"II-43","page_number":74,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"62ff84e2-e014-48f7-b111-bf712dafa56a","block_type":"box","text":"NM1026U-5982568-74/232","page_number":74,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"f12f1b5d-ed96-4302-9e5c-a56775633f69","block_type":"box","text":"Securities in the investor’s account before the market opens on that day. If there are insufficient Stock Connect","page_number":75,"box":{"x":69,"y":45,"width":797,"height":11}},{"id":"332cf648-8b08-4e01-ac28-722e166df9ac","block_type":"box","text":"Securities in the investor’s account, the sell order will be rejected by the SSE or SZSE, as applicable. SEHK carries","page_number":75,"box":{"x":69,"y":60,"width":820,"height":11}},{"id":"79ca4a53-f1da-44c7-98e0-fc122c4cff05","block_type":"box","text":"out pre-trade checking on sell orders of cer tain stocks listed on the SSE market (“SSE Securities”) or SZSE market","page_number":75,"box":{"x":69,"y":75,"width":820,"height":11}},{"id":"9b5ed9f1-1160-4841-a9e3-0f7e66c600f4","block_type":"box","text":"(“SZSE Securities”) of its par ticipants (","page_number":75,"box":{"x":69,"y":90,"width":278,"height":11}},{"id":"4182be66-889e-4ae6-bd63-da772227d878","block_type":"box","text":"i.e.","page_number":75,"box":{"x":349,"y":90,"width":21,"height":9}},{"id":"07325490-0155-4d19-ac9f-cc9661a4535d","block_type":"box","text":", stock brokers) to ensure that this requirement is satisfied. While shares","page_number":75,"box":{"x":372,"y":90,"width":524,"height":11}},{"id":"a707b91f-239b-4df9-bc69-7969ae566602","block_type":"box","text":"must be designated as eligible to be traded under a Stock Connect, those shares may also lose such designation,","page_number":75,"box":{"x":69,"y":105,"width":815,"height":11}},{"id":"5431f142-d533-4886-b2d8-31c96d03cf62","block_type":"box","text":"and if this occurs, such shares may be sold but cannot be purchased through a Stock Connect. In addition, Stock","page_number":75,"box":{"x":69,"y":120,"width":810,"height":12}},{"id":"cd03bbd9-ee90-4c4f-8d39-c06d72bf7706","block_type":"box","text":"Connects will only operate on days when both the Chinese and Hong Kong markets are open for trading, and banking","page_number":75,"box":{"x":69,"y":135,"width":834,"height":12}},{"id":"4629d23c-46b1-411f-8ebd-f7d68209a5aa","block_type":"box","text":"services are available in both markets on the corresponding settlement days. Therefore, an investment in Stock","page_number":75,"box":{"x":69,"y":150,"width":799,"height":12}},{"id":"91105f8e-4125-4831-b752-015250823df7","block_type":"box","text":"Connect Securities through a Stock Connect may subject a Fund to a risk of price fluctuations on days when the","page_number":75,"box":{"x":69,"y":166,"width":797,"height":11}},{"id":"7d1f089e-582f-4373-abe8-0fd5ff262606","block_type":"box","text":"Chinese market is open, but a Stock Connect is not trading. Moreover, day (turnaround) trading is not permitted on","page_number":75,"box":{"x":69,"y":181,"width":818,"height":11}},{"id":"35c1870b-64c8-4df8-8473-1fcab7cd15bd","block_type":"box","text":"the Stock Connect Securities market. If an investor buys Stock Connect Securities on day “T,” the investor will only","page_number":75,"box":{"x":68,"y":196,"width":820,"height":11}},{"id":"276555a7-9d39-49dc-943c-1f327770ac0f","block_type":"box","text":"be able to sell the Stock Connect Securities on or after day T+1. Fur ther, since all trades of Stock Connect Securities","page_number":75,"box":{"x":69,"y":211,"width":836,"height":11}},{"id":"2323e4b7-5342-489c-a572-ea60a137d840","block_type":"box","text":"must be settled in RMB, investors must have timely access to a reliable supply of offshore RMB, which cannot be","page_number":75,"box":{"x":69,"y":226,"width":811,"height":11}},{"id":"aa1ee44f-9e02-440f-af9e-a13ab7b48f7a","block_type":"box","text":"guaranteed. There is also no assurance that RMB will not be subject to devaluation. Any devaluation of RMB could","page_number":75,"box":{"x":68,"y":241,"width":815,"height":11}},{"id":"69adc6e1-1e2e-43bc-a9ec-44de0309082b","block_type":"box","text":"adversely affect a Fund’s investments. If a Fund holds a class of shares denominated in a local currency other than","page_number":75,"box":{"x":69,"y":256,"width":824,"height":11}},{"id":"048e88f9-5b23-44e1-a86f-3fc2070f6e72","block_type":"box","text":"RMB, the Fund will be exposed to currency exchange risk if the Fund conver ts the local currency into RMB for","page_number":75,"box":{"x":70,"y":271,"width":777,"height":12}},{"id":"745548cd-6371-4235-b96b-1d2b2b7bbeed","block_type":"box","text":"investments in Stock Connect Securities. A Fund may also incur conversion costs.","page_number":75,"box":{"x":70,"y":287,"width":582,"height":11}},{"id":"fbc4d1c8-4e11-4c0d-8c13-8031b9473827","block_type":"box","text":"Stock Connect Securities held through the nominee structure under a Stock Connect will be held through HKSCC","page_number":75,"box":{"x":102,"y":309,"width":802,"height":11}},{"id":"c35486b6-4c35-4c45-b52b-108ecbad9101","block_type":"box","text":"as nominee on behalf of investors. The precise nature and rights of a Fund as the beneficial owner of the SSE","page_number":75,"box":{"x":69,"y":324,"width":784,"height":12}},{"id":"645b83a6-8bfb-4754-9c39-4528b63832a0","block_type":"box","text":"Securities or SZSE Securities through HKSCC as nominee is not well defined under the PRC laws. There is a lack of a","page_number":75,"box":{"x":69,"y":339,"width":837,"height":12}},{"id":"dce7e6d0-100d-4ea6-b673-4073a6aaa1ce","block_type":"box","text":"clear definition of, and distinction between, legal ownership and beneficial ownership under the PRC laws and there","page_number":75,"box":{"x":69,"y":355,"width":822,"height":11}},{"id":"122e2a6d-9dd7-40a3-b6f1-31b02658772d","block_type":"box","text":"have been few cases involving a nominee account structure in the PRC cour ts. The exact nature and methods of","page_number":75,"box":{"x":69,"y":370,"width":802,"height":11}},{"id":"0af2a5bb-68df-4f70-9451-cd0e82dd99a5","block_type":"box","text":"enforcement of the rights and interests of a Fund under the PRC laws is also uncer tain. In the unlikely event that","page_number":75,"box":{"x":69,"y":385,"width":805,"height":11}},{"id":"58ee4460-dd65-41a4-98cd-a48fd6877f5f","block_type":"box","text":"HKSCC becomes subject to winding up proceedings in Hong Kong, there is a risk that the SSE Securities or SZSE","page_number":75,"box":{"x":70,"y":400,"width":807,"height":11}},{"id":"c553bd18-101b-451f-b28f-c8261977cda2","block_type":"box","text":"Securities may not be regarded as held for the beneficial ownership of a Fund or as par t of the general assets of","page_number":75,"box":{"x":69,"y":415,"width":805,"height":11}},{"id":"8d60902f-27bb-45ca-bc53-9829e6b9ff98","block_type":"box","text":"HKSCC available for general distribution to its creditors. Notwithstanding the fact that HKSCC does not claim","page_number":75,"box":{"x":70,"y":430,"width":774,"height":11}},{"id":"35e59de4-9b66-4d8e-b504-b075c712a7c8","block_type":"box","text":"proprietary interests in the SSE Securities or SZSE Securities held in its omnibus stock account in the CSDCC, the","page_number":75,"box":{"x":70,"y":445,"width":816,"height":11}},{"id":"24aecdde-4919-4be1-ae62-03dc079862b6","block_type":"box","text":"CSDCC as the share registrar for SSE- or SZSE-listed companies will still treat HKSCC as one of the shareholders","page_number":75,"box":{"x":69,"y":460,"width":808,"height":12}},{"id":"86382b09-b7ff-4279-91c0-fb7724f9fac3","block_type":"box","text":"when it handles corporate actions in respect of such SSE Securities or SZSE Securities. HKSCC monitors the","page_number":75,"box":{"x":68,"y":475,"width":779,"height":11}},{"id":"d0055547-57f0-44b6-ab9b-478af6a90146","block_type":"box","text":"corporate actions affecting SSE Securities and SZSE Securities and keeps par ticipants of Central Clearing and","page_number":75,"box":{"x":69,"y":491,"width":788,"height":11}},{"id":"fafa8cfb-7e18-4afd-8506-22d3751b1716","block_type":"box","text":"Settlement System (“CCASS”) informed of all such corporate actions that require CCASS par ticipants to take steps in","page_number":75,"box":{"x":69,"y":506,"width":839,"height":11}},{"id":"cd3e36da-13a8-45ef-a2f4-6b052468b59c","block_type":"box","text":"order to par ticipate in them. Investors may only exercise their voting rights by providing their voting instructions to","page_number":75,"box":{"x":69,"y":521,"width":811,"height":11}},{"id":"7c34ad7b-b584-40f3-b7d1-bbbda9f8a568","block_type":"box","text":"HKSCC through par ticipants of CCASS. All voting instructions from CCASS par ticipants will be consolidated by","page_number":75,"box":{"x":70,"y":536,"width":783,"height":11}},{"id":"7d32222a-a31c-4043-a764-9597cfad0998","block_type":"box","text":"HKSCC, who will then submit a combined single voting instruction to the relevant SSE- or SZSE-listed company. As a","page_number":75,"box":{"x":70,"y":551,"width":826,"height":11}},{"id":"7e4c69b4-4179-43a6-b923-3138e39432bd","block_type":"box","text":"result, a Fund may suffer difficulties or delays in enforcing its rights in SSE Securities or SZSE Securities.","page_number":75,"box":{"x":69,"y":566,"width":752,"height":11}},{"id":"8ae90f53-324e-44ca-9589-dbb7ee8c28d1","block_type":"box","text":"Hong Kong’s Investor Compensation Fund is established to pay compensation to investors of any nationality who","page_number":75,"box":{"x":102,"y":589,"width":804,"height":11}},{"id":"c8bdce0a-ccaa-496a-8d5f-5d5e648e5c98","block_type":"box","text":"suffer pecuniary losses as a result of default of a licensed intermediary or authorized financial institution in relation","page_number":75,"box":{"x":69,"y":604,"width":826,"height":11}},{"id":"25c2007a-8a6a-4a1c-9258-972b6c5f621e","block_type":"box","text":"to exchange-traded products in Hong Kong. For defaults occurring on or after January 1, 2020, Hong Kong’s","page_number":75,"box":{"x":68,"y":619,"width":769,"height":11}},{"id":"77ecd09a-b348-48f5-ac74-bf52d42dc078","block_type":"box","text":"Investor Compensation Fund covers investors’ losses in relation to securities (i) that are traded on the SSE or the","page_number":75,"box":{"x":70,"y":634,"width":809,"height":11}},{"id":"9b363143-b20c-4028-b7bd-b9c7a7568766","block_type":"box","text":"SZSE and (ii) in respect of which an order for sale or purchase is permitted to be routed through the Nor thbound","page_number":75,"box":{"x":69,"y":649,"width":801,"height":12}},{"id":"ff3b15c2-5e10-497d-beb1-f458e8f2558c","block_type":"box","text":"Trading Link of a Stock Connect. On the other hand, since a Fund carries out Nor thbound trading through securities","page_number":75,"box":{"x":68,"y":664,"width":822,"height":12}},{"id":"e1e4674a-8a48-4b80-8e22-1a3475ca5ec9","block_type":"box","text":"brokers in Hong Kong but not PRC brokers, it is not protected by the China Securities Investor Protection Fund in the","page_number":75,"box":{"x":69,"y":680,"width":829,"height":11}},{"id":"ba9848ae-8e86-4420-a7d5-d4afd7300398","block_type":"box","text":"PRC.","page_number":75,"box":{"x":69,"y":695,"width":32,"height":9}},{"id":"532a6785-676a-401f-9c37-3e8ed4951827","block_type":"box","text":"Market par ticipants are able to par ticipate in Stock Connects subject to meeting cer tain information technology","page_number":75,"box":{"x":102,"y":717,"width":796,"height":12}},{"id":"e9e50985-4939-4ef9-b673-03051738c2dd","block_type":"box","text":"capability, risk management and other requirements as may be specified by the relevant exchange and/or clearing","page_number":75,"box":{"x":69,"y":732,"width":815,"height":12}},{"id":"4616ead4-ea7f-4a6d-847f-be3f5b74634b","block_type":"box","text":"house. Fur ther, the “connectivity” in Stock Connects requires routing of orders across the border of Hong Kong and","page_number":75,"box":{"x":69,"y":748,"width":822,"height":11}},{"id":"577d6367-d921-4bbe-ab8a-56adff7e5129","block_type":"box","text":"the PRC. This requires the development of new information technology systems on the par t of SEHK and exchange","page_number":75,"box":{"x":68,"y":763,"width":818,"height":11}},{"id":"b5d6f45b-fae7-4013-b5c9-4b9156667dc2","block_type":"box","text":"par ticipants. There is no assurance that the systems of SEHK and market par ticipants will function properly or will","page_number":75,"box":{"x":70,"y":778,"width":813,"height":11}},{"id":"0c8908e8-7c11-42b7-baa5-48737ac1ae86","block_type":"box","text":"continue to be adapted to changes and developments in both markets. In the event that the relevant systems fail to","page_number":75,"box":{"x":69,"y":793,"width":827,"height":11}},{"id":"23d861fb-bbbc-41e5-9ff1-27c5391809c3","block_type":"box","text":"function properly, trading in Stock Connect Securities through Stock Connects could be disrupted.","page_number":75,"box":{"x":68,"y":808,"width":695,"height":11}},{"id":"3c6537e7-6205-4260-8acb-df3ebbc119d8","block_type":"box","text":"The Shanghai-Hong Kong Stock Connect program launched in November 2014 and the Shenzhen-Hong Kong","page_number":75,"box":{"x":101,"y":831,"width":772,"height":11}},{"id":"3fe5e88f-fe74-4aa1-89fb-96490b614d13","block_type":"box","text":"Stock Connect program launched in December 2016. Each program does not have an extensive operating history.","page_number":75,"box":{"x":69,"y":846,"width":810,"height":11}},{"id":"57aa44d1-1517-4570-99f3-1036532acbb0","block_type":"box","text":"New or revised regulations may be issued from time to time by the regulators and stock exchanges in China and","page_number":75,"box":{"x":70,"y":861,"width":798,"height":11}},{"id":"6a588e8d-635e-4928-9277-9a3a1d02d16f","block_type":"box","text":"Hong Kong in connection with operations, legal enforcement and cross-border trades under Stock Connects. In","page_number":75,"box":{"x":70,"y":876,"width":786,"height":11}},{"id":"a6cd6c59-9ecf-470e-aa5e-0409e2b4a8c6","block_type":"box","text":"addition, there can be no assurance that Stock Connect will not be discontinued. A Fund may be adversely affected","page_number":75,"box":{"x":69,"y":891,"width":821,"height":11}},{"id":"eecef4f1-0e4e-47d4-b1dc-95c9d17f9fbe","block_type":"box","text":"as a result of such changes. Fur thermore, the securities regimes and legal systems of China and Hong Kong differ","page_number":75,"box":{"x":69,"y":906,"width":819,"height":12}},{"id":"6837bd79-6dd2-4d3c-a97c-4170aa08a11e","block_type":"box","text":"II-44","page_number":75,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"bf66b542-5b7a-4895-b860-9ffb3528e06a","block_type":"box","text":"NM1026U-5982568-75/232","page_number":75,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"62b6fcc2-886d-41d9-add9-a21ae076b1ab","block_type":"box","text":"significantly and issues may arise from the differences on an on-going basis. In the event that the relevant systems","page_number":76,"box":{"x":69,"y":45,"width":823,"height":11}},{"id":"c1fd3b81-131f-4cfc-a034-929e483ba4ac","block_type":"box","text":"fail to function properly, trading in both markets through Stock Connects could be disrupted and a Fund’s ability to","page_number":76,"box":{"x":68,"y":60,"width":814,"height":11}},{"id":"963ff031-4286-427b-8d06-d7c9c3f5cea8","block_type":"box","text":"achieve its investment objective may be adversely affected. In addition, a Fund’s investments in Stock Connect","page_number":76,"box":{"x":69,"y":75,"width":793,"height":11}},{"id":"bc22098a-29fb-47fb-9f64-31531802ec4f","block_type":"box","text":"Securities through Stock Connects are generally subject to Chinese securities regulations and listing rules, among","page_number":76,"box":{"x":69,"y":90,"width":815,"height":11}},{"id":"115c4dd1-e80c-4561-b9cc-0b60c03d16e2","block_type":"box","text":"other restrictions. Fur ther, different fees, costs and taxes are imposed on foreign investors acquiring Stock Connect","page_number":76,"box":{"x":69,"y":105,"width":828,"height":11}},{"id":"65126790-3a9c-4d1b-b0eb-fb6ec8f80eca","block_type":"box","text":"Securities through Stock Connects, and these fees, costs and taxes may be higher than comparable fees, costs and","page_number":76,"box":{"x":69,"y":120,"width":831,"height":12}},{"id":"2e2bd809-cc69-43a3-943c-bd5d4aa54850","block_type":"box","text":"taxes imposed on owners of other securities providing similar investment exposure.","page_number":76,"box":{"x":68,"y":135,"width":596,"height":12}},{"id":"4f01a320-a8d9-434a-9ea9-1a944e263700","block_type":"box","text":"Suspension Risk.","page_number":76,"box":{"x":102,"y":158,"width":122,"height":11}},{"id":"682904ab-e7b9-415f-8d8c-c36f628d03d0","block_type":"box","text":"SSE Securities and SZSE Securities may only be bought from, or sold to, a Fund at times when","page_number":76,"box":{"x":231,"y":158,"width":675,"height":11}},{"id":"c71eb458-ee97-448a-a609-c57dffb8233c","block_type":"box","text":"the relevant SSE Securities and SZSE Securities may be sold or purchased on the relevant Chinese stock exchange.","page_number":76,"box":{"x":68,"y":173,"width":829,"height":11}},{"id":"16b3d311-7b41-45ee-8d05-81a38117d39d","block_type":"box","text":"The SSE Securities and SZSE Securities markets have a higher propensity for trading suspensions than many other","page_number":76,"box":{"x":68,"y":188,"width":823,"height":12}},{"id":"35f2418a-ed1b-4d16-a984-b88af81e64de","block_type":"box","text":"global equity markets. Each of the SEHK, SSE and SZSE reserves the right to suspend trading of SSE Securities and","page_number":76,"box":{"x":68,"y":203,"width":831,"height":12}},{"id":"5144d2a3-6810-4242-b074-eee82681497d","block_type":"box","text":"SZSE Securities purchased on the Stock Connects if necessary for ensuring an orderly and fair market and ensuring","page_number":76,"box":{"x":69,"y":218,"width":828,"height":12}},{"id":"ffc37a6e-88b5-4392-badd-f110c2823293","block_type":"box","text":"that risks are managed prudently. Consent from the relevant regulator would be sought before a suspension of","page_number":76,"box":{"x":68,"y":234,"width":791,"height":11}},{"id":"dbbc19ad-0fb0-41c3-8758-afa1148c7c75","block_type":"box","text":"Nor thbound trading is triggered. The relevant PRC government authority may also impose “circuit breakers” and other","page_number":76,"box":{"x":70,"y":249,"width":837,"height":11}},{"id":"634c3d1e-0c26-4f8b-a4ea-b27b50eb1004","block_type":"box","text":"measures to halt or suspend Nor thbound trading. Where a suspension in the Nor thbound trading through Stock","page_number":76,"box":{"x":69,"y":264,"width":796,"height":11}},{"id":"fc1f7971-f781-46b1-969b-3c320707fd60","block_type":"box","text":"Connect is effected, the Fund’s ability to access the PRC market will be adversely affected. Trading suspensions in","page_number":76,"box":{"x":69,"y":279,"width":820,"height":11}},{"id":"8b33e866-b14e-4aaa-8dae-1c6f7d7d5d87","block_type":"box","text":"cer tain stocks could lead to greater market execution risk and costs for a Fund. The SSE and SZSE currently apply a","page_number":76,"box":{"x":69,"y":294,"width":829,"height":11}},{"id":"5b3fe520-5ac7-42a5-90fc-c2d451e52f37","block_type":"box","text":"daily price limit, generally set at 10%, of the amount of fluctuation permitted in the prices of the relevant SSE","page_number":76,"box":{"x":69,"y":309,"width":778,"height":11}},{"id":"23398792-f4aa-4f33-bb72-136ce423233a","block_type":"box","text":"Securities and SZSE Securities during a single trading day. The daily price limit refers to price movements only and","page_number":76,"box":{"x":69,"y":324,"width":815,"height":12}},{"id":"22b4edb0-8de9-42a7-a2a8-e3e309fb0b1c","block_type":"box","text":"does not restrict trading within the relevant limit. There can be no assurance that a liquid market on an exchange will","page_number":76,"box":{"x":69,"y":340,"width":833,"height":11}},{"id":"5e1872e7-f5f7-40f6-abdd-594fc888c74c","block_type":"box","text":"exist for any par ticular SSE Security or SZSE Security or for any par ticular time.","page_number":76,"box":{"x":69,"y":355,"width":563,"height":11}},{"id":"5a3dc1b2-157d-43a2-8fd7-8b9af4f0fd3e","block_type":"box","text":"Risk of Investing in the China Interbank Bond Market through Bond Connect.","page_number":76,"box":{"x":102,"y":377,"width":542,"height":12}},{"id":"e79d7e00-599c-48fa-a26b-3533acc66377","block_type":"box","text":"A Fund may invest directly in the","page_number":76,"box":{"x":650,"y":377,"width":230,"height":11}},{"id":"88ff6b2c-f9d8-419f-bbdf-1977193b45f5","block_type":"box","text":"domestic bond market in the PRC (the “China Interbank Bond Market”) through the nor thbound trading of Bond","page_number":76,"box":{"x":69,"y":392,"width":791,"height":12}},{"id":"363b63ff-9f97-4309-b442-221d604fa9d9","block_type":"box","text":"Connect (“Bond Connect”). Bond Connect is an initiative launched in July 2017 for mutual bond market access","page_number":76,"box":{"x":69,"y":407,"width":790,"height":12}},{"id":"8f8c0094-14a2-44de-8cc4-599542dd402d","block_type":"box","text":"between the PRC and Hong Kong, established by the China Foreign Exchange Trade System & National Interbank","page_number":76,"box":{"x":69,"y":423,"width":803,"height":11}},{"id":"4ad8917e-1e77-4d62-9b0c-94b4ae45a49f","block_type":"box","text":"Funding Centre (“CFETS”), China Central Depository & Clearing Co., Ltd (“CDCC”), Shanghai Clearing House (“SCH”),","page_number":76,"box":{"x":70,"y":438,"width":832,"height":11}},{"id":"e1202285-43b3-456d-83b2-287d6624ba73","block_type":"box","text":"Hong Kong Exchanges and Clearing Limited (“HKEX”) and Central Moneymarkets Unit (“CMU”). Under the prevailing","page_number":76,"box":{"x":70,"y":453,"width":821,"height":11}},{"id":"f76facc5-ce25-468d-ab81-cf5b5e7947fe","block_type":"box","text":"regulations in the PRC, eligible foreign investors are allowed to invest in the bonds circulated in the China Interbank","page_number":76,"box":{"x":69,"y":468,"width":825,"height":11}},{"id":"c0e15439-7f0b-46a1-a048-79f29540261a","block_type":"box","text":"Bond Market through Bond Connect. Eligible foreign investors may submit trade requests for bonds circulated in the","page_number":76,"box":{"x":70,"y":483,"width":825,"height":11}},{"id":"3f37a815-5903-494b-9567-7648c54ec387","block_type":"box","text":"China Interbank Bond Market through offshore electronic bond trading platforms (such as Tradeweb), which will in","page_number":76,"box":{"x":69,"y":498,"width":809,"height":11}},{"id":"c6cd8bc3-e538-490d-8e06-dbdfb38164e6","block_type":"box","text":"turn transmit their requests for quotation to CFETS. CFETS will send the requests for quotation to a number of","page_number":76,"box":{"x":68,"y":513,"width":786,"height":11}},{"id":"46069e54-3eaa-42ce-9233-80d372fe8b11","block_type":"box","text":"approved onshore dealers (including market makers and others engaged in the market making business) in the PRC.","page_number":76,"box":{"x":69,"y":529,"width":830,"height":11}},{"id":"f1718542-5a0c-45a0-addc-d6f098deb9d3","block_type":"box","text":"The approved onshore dealer(s) will respond to the requests for quotation via CFETS and CFETS will send their","page_number":76,"box":{"x":68,"y":543,"width":788,"height":12}},{"id":"cb2fe132-7db7-4b51-9199-4f62bb30ce5b","block_type":"box","text":"responses to those eligible foreign investors through the same offshore electronic bond trading platforms. Once the","page_number":76,"box":{"x":69,"y":559,"width":827,"height":11}},{"id":"8508daf8-2433-4daf-811b-a8b58cce1eef","block_type":"box","text":"eligible foreign investor accepts the quotation, the trade is concluded on CFETS.","page_number":76,"box":{"x":69,"y":574,"width":570,"height":11}},{"id":"f74bb2db-bf05-42ea-bf5e-513844d87b73","block_type":"box","text":"The settlement and custody of bonds traded in the China Interbank Bond Market under Bond Connect will be","page_number":76,"box":{"x":101,"y":596,"width":773,"height":12}},{"id":"f58a607f-9c0e-42ea-8c36-bdcdef8d1826","block_type":"box","text":"effected through the settlement and custody link between CMU, as an offshore custody agent, and CDCC and SCH,","page_number":76,"box":{"x":69,"y":612,"width":823,"height":11}},{"id":"b5acd7cf-c5c5-4919-a6b2-4a755b3e60e6","block_type":"box","text":"as onshore custodians and clearing institutions in the PRC. Under the settlement link, CDCC or SCH will effect gross","page_number":76,"box":{"x":69,"y":627,"width":832,"height":11}},{"id":"9802f133-703f-4f03-b2d1-0b73b63e1280","block_type":"box","text":"settlement of confirmed trades onshore and CMU will process bond settlement instructions from CMU members on","page_number":76,"box":{"x":69,"y":642,"width":822,"height":11}},{"id":"cb6408b2-a369-4118-a05a-d69847a6f357","block_type":"box","text":"behalf of eligible foreign investors in accordance with its relevant rules. Since the introduction in August 2018 of","page_number":76,"box":{"x":69,"y":657,"width":804,"height":11}},{"id":"8f0c6275-b9a1-4bef-8587-7809c582bdcb","block_type":"box","text":"delivery versus payment (DVP) settlement in respect of Bond Connect, the movement of cash and securities is","page_number":76,"box":{"x":69,"y":672,"width":787,"height":11}},{"id":"49232ad8-bc3f-4f10-bf09-afa369d669c9","block_type":"box","text":"carried out simultaneously on a real-time basis. Pursuant to the prevailing regulations in the PRC, CMU, as the","page_number":76,"box":{"x":69,"y":687,"width":788,"height":11}},{"id":"c6606a89-ef01-4970-ad35-ccb95aa1171b","block_type":"box","text":"offshore custody agent recognized by the Hong Kong Monetary Authority, will open omnibus nominee accounts with","page_number":76,"box":{"x":69,"y":702,"width":820,"height":12}},{"id":"7944f18c-1605-456c-a642-7680fb19b911","block_type":"box","text":"the onshore custody agent recognized by the People’s Bank of China (","page_number":76,"box":{"x":68,"y":717,"width":500,"height":12}},{"id":"e73667c5-228f-4f8f-8773-dfff296c02f9","block_type":"box","text":"i.e.","page_number":76,"box":{"x":570,"y":718,"width":20,"height":8}},{"id":"5c0f8380-7615-418b-a8d0-a267d74b6d67","block_type":"box","text":", CDCC and SCH). All bonds traded by","page_number":76,"box":{"x":593,"y":718,"width":267,"height":11}},{"id":"5adacbde-22e7-40fb-a714-2fe6d4f9de99","block_type":"box","text":"eligible foreign investors through Bond Connect will be registered in the name of CMU, which will hold such bonds as","page_number":76,"box":{"x":69,"y":732,"width":832,"height":12}},{"id":"0a1dd68e-dd0c-4c20-a83d-0f7d0612a1eb","block_type":"box","text":"a nominee owner. Therefore, a Fund will be exposed to custody risks with respect to CMU. In the remote event of a","page_number":76,"box":{"x":69,"y":748,"width":819,"height":11}},{"id":"b078b87c-9c3d-4760-a28f-0b77b9902766","block_type":"box","text":"CDCC or SCH default, CMU’s liabilities in Bond Connect bonds under its market contracts with clearing par ticipants","page_number":76,"box":{"x":69,"y":763,"width":822,"height":11}},{"id":"a96c6d9c-0a5c-468a-b26f-2292733c7c47","block_type":"box","text":"will be limited to assisting clearing par ticipants in pursuing their claims against CDCC or SCH. The Fund may suffer","page_number":76,"box":{"x":68,"y":778,"width":822,"height":11}},{"id":"c228fdfc-b3bc-4c5d-bfa9-39303791f60f","block_type":"box","text":"delay in the recovery process or may not fully recover its losses from CDCC or SCH. In addition, as the relevant","page_number":76,"box":{"x":69,"y":793,"width":793,"height":11}},{"id":"b5024cb2-a6e9-45f0-9a6c-a732b7554500","block_type":"box","text":"filings, registration with the People’s Bank of China, and account opening have to be carried out by third par ties,","page_number":76,"box":{"x":68,"y":808,"width":802,"height":11}},{"id":"5e608dc6-9095-44e8-b744-43b44cdeaeea","block_type":"box","text":"including CMU, CDCC, SCH, and CFETS, a Fund is subject to the risks of default or errors on the par t of such third","page_number":76,"box":{"x":70,"y":823,"width":812,"height":12}},{"id":"8741a347-5e06-43e0-882c-db7fe4f170d5","block_type":"box","text":"par ties.","page_number":76,"box":{"x":70,"y":839,"width":52,"height":10}},{"id":"f8846b1f-a309-4c66-99f3-49b01e6f9fab","block_type":"box","text":"The precise nature and rights of a Fund as the beneficial owner of the bonds traded in the China Interbank Bond","page_number":76,"box":{"x":101,"y":861,"width":799,"height":11}},{"id":"11412ddc-2f9b-4958-a250-ef34d3671a7d","block_type":"box","text":"Market through CMU as nominee is not well-defined under PRC law. There is a lack of a clear definition of, and","page_number":76,"box":{"x":70,"y":876,"width":785,"height":11}},{"id":"b7cfc202-0472-40be-a9d9-479ae817b40d","block_type":"box","text":"distinction between, legal ownership and beneficial ownership under PRC law and there have been few cases","page_number":76,"box":{"x":69,"y":891,"width":776,"height":12}},{"id":"607eb1b2-596b-414c-b5d6-345005e15dff","block_type":"box","text":"II-45","page_number":76,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"a1d67223-67a5-4e41-a9fa-a911c489eae0","block_type":"box","text":"NM1026U-5982568-76/232","page_number":76,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"ae5b6461-7b47-46f2-950e-182213ba1b40","block_type":"box","text":"involving a nominee account structure in the PRC cour ts. The exact nature and methods of enforcement of the rights","page_number":77,"box":{"x":70,"y":45,"width":830,"height":11}},{"id":"b4130368-8a64-4775-88a1-28ed1d9a49e7","block_type":"box","text":"and interests of a Fund under PRC law are also uncer tain.","page_number":77,"box":{"x":69,"y":60,"width":412,"height":9}},{"id":"be5800f2-dca6-459d-ae26-31795194fd64","block_type":"box","text":"Market volatility and potential lack of liquidity due to low trading volume of cer tain bonds in the China Interbank","page_number":77,"box":{"x":102,"y":82,"width":793,"height":12}},{"id":"7439c303-17a6-4827-92b8-35474520da37","block_type":"box","text":"Bond Market may result in prices of cer tain bonds traded on such market fluctuating significantly. A Fund investing in","page_number":77,"box":{"x":70,"y":98,"width":832,"height":11}},{"id":"4664003c-8f3d-4f6a-acc1-9973343eda4a","block_type":"box","text":"such market is therefore subject to liquidity and volatility risks. The bid-ask spreads of the prices of such securities","page_number":77,"box":{"x":69,"y":113,"width":821,"height":11}},{"id":"b27a11fe-0a09-44b7-9954-753489d07afc","block_type":"box","text":"may be large, and a Fund may therefore incur significant costs and may suffer losses when selling such investments.","page_number":77,"box":{"x":69,"y":128,"width":836,"height":11}},{"id":"e5a92903-1e51-4532-9bfc-5588b7266cb4","block_type":"box","text":"The bonds traded in the China Interbank Bond Market may be difficult or impossible to sell, which may impact a","page_number":77,"box":{"x":68,"y":143,"width":798,"height":11}},{"id":"c160c458-347c-4e1c-9302-03c459bc3db7","block_type":"box","text":"Fund’s ability to acquire or dispose of such securities at their expected prices.","page_number":77,"box":{"x":70,"y":158,"width":556,"height":11}},{"id":"feb0e740-c710-40ac-a0c5-13bdabb22795","block_type":"box","text":"Investing in the China Interbank Bond Market through Bond Connect is also subject to regulatory risks. The","page_number":77,"box":{"x":102,"y":181,"width":762,"height":11}},{"id":"0ca858a2-9fc3-44dd-80d3-0f4f9fc06f85","block_type":"box","text":"relevant rules and regulations are subject to change, which may have potential retrospective effect, and there can be","page_number":77,"box":{"x":69,"y":196,"width":835,"height":11}},{"id":"19a50081-12bd-4616-addb-08648c0a5599","block_type":"box","text":"no assurance that Bond Connect will not be discontinued or abolished. Fur thermore, the securities regimes and legal","page_number":77,"box":{"x":69,"y":211,"width":835,"height":11}},{"id":"b3e25b9c-32d4-47ed-bc76-5fd7fccf19bd","block_type":"box","text":"systems of China and Hong Kong differ significantly and issues may arise based on these differences. In the event","page_number":77,"box":{"x":69,"y":226,"width":820,"height":11}},{"id":"e3a0dd55-fca5-48c5-8bc2-a8006e95f3db","block_type":"box","text":"that the relevant authorities suspend account opening or trading on the China Interbank Bond Market, a Fund’s ability","page_number":77,"box":{"x":68,"y":241,"width":840,"height":11}},{"id":"1ae26196-58bd-4769-8d45-d6375143fbae","block_type":"box","text":"to invest in the China Interbank Bond Market will be adversely affected and limited. In such event, the Fund’s ability","page_number":77,"box":{"x":68,"y":256,"width":826,"height":11}},{"id":"8a97ca80-92a7-4392-a126-13f0ff625a0f","block_type":"box","text":"to achieve its investment objective will be negatively affected and, after exhausting other trading alternatives, the","page_number":77,"box":{"x":68,"y":271,"width":808,"height":12}},{"id":"f35fac76-6cdb-4780-b410-7c659838f4b9","block_type":"box","text":"Fund may suffer substantial losses as a result. Fur ther, if Bond Connect is not operating, a Fund may not be able to","page_number":77,"box":{"x":70,"y":286,"width":826,"height":12}},{"id":"dd113664-c2eb-47e5-b957-13792c9b3f5d","block_type":"box","text":"acquire or dispose of bonds through Bond Connect in a timely manner, which could adversely affect the Fund’s","page_number":77,"box":{"x":69,"y":302,"width":789,"height":11}},{"id":"7af06b72-b061-43fd-8a3e-42bd67e602eb","block_type":"box","text":"per formance.","page_number":77,"box":{"x":70,"y":317,"width":93,"height":11}},{"id":"690e2783-41d2-45f5-947b-d16cfefd2901","block_type":"box","text":"Trading through Bond Connect is per formed through newly developed trading platforms and operational systems.","page_number":77,"box":{"x":101,"y":339,"width":803,"height":12}},{"id":"0786b3b1-9d54-416d-b4da-a89cd7bec795","block_type":"box","text":"There is no assurance that such systems will function properly or will continue to be adapted to changes and","page_number":77,"box":{"x":68,"y":355,"width":776,"height":11}},{"id":"230308ff-87e6-4adb-8c35-156750afc056","block_type":"box","text":"developments in the market. In the event that the relevant systems fail to function properly, trading through Bond","page_number":77,"box":{"x":69,"y":370,"width":806,"height":11}},{"id":"4f495994-7bdf-485c-9033-3716ee97c3c1","block_type":"box","text":"Connect may be disrupted. A Fund’s ability to trade through Bond Connect (and hence to pursue its investment","page_number":77,"box":{"x":69,"y":385,"width":791,"height":11}},{"id":"1adbfdfb-676e-4740-b01d-fe367dbc9de4","block_type":"box","text":"strategy) may therefore be adversely affected. In addition, where a Fund invests in the China Interbank Bond Market","page_number":77,"box":{"x":69,"y":400,"width":827,"height":11}},{"id":"85ed58bb-8865-4ddd-94e7-f4b241249ddd","block_type":"box","text":"through Bond Connect, it may be subject to risks of delays inherent in the order placing and/or settlement systems.","page_number":77,"box":{"x":68,"y":415,"width":827,"height":11}},{"id":"69334412-ba03-4f0a-9806-54f5177b103d","block_type":"box","text":"Bond Connect trades are settled in Chinese currency, the RMB, which is currently restricted and not freely","page_number":77,"box":{"x":102,"y":438,"width":755,"height":11}},{"id":"c8559ee2-647f-4fdc-8af1-6f0288f88201","block_type":"box","text":"conver tible. As a result, a Fund will be exposed to currency risk, and it cannot be guaranteed that investors will have","page_number":77,"box":{"x":69,"y":453,"width":830,"height":11}},{"id":"5cbc2f6e-7ad1-4120-879c-0b09f194865e","block_type":"box","text":"timely access to a reliable supply of RMB.","page_number":77,"box":{"x":68,"y":468,"width":298,"height":11}},{"id":"2902b62d-58e9-4eaf-bbf3-a0dc38749727","block_type":"box","text":"Tax Risk – Withholding Income Tax Risk","page_number":77,"box":{"x":103,"y":491,"width":277,"height":11}},{"id":"8d88aaa0-a284-4d45-bdb8-4ea01544a446","block_type":"box","text":".","page_number":77,"box":{"x":381,"y":498,"width":2,"height":2}},{"id":"7c0680b6-280f-4b7d-9cfc-8a6ad3e93b30","block_type":"box","text":"According to PRC tax regulations, a 10% withholding income tax is imposed on PRC sourced dividends and","page_number":77,"box":{"x":101,"y":513,"width":758,"height":12}},{"id":"65dc037b-1c35-4f38-bf14-e1c95a723bcd","block_type":"box","text":"interests from non-government bonds paid to a non-PRC tax resident enterprise, unless the rate is reduced under an","page_number":77,"box":{"x":70,"y":528,"width":828,"height":12}},{"id":"50bee31d-e71d-4430-bd6e-b4b21e8c8d5f","block_type":"box","text":"applicable tax treaty. From a technical perspective, withholding income tax is also applicable to capital gains realized","page_number":77,"box":{"x":69,"y":544,"width":831,"height":11}},{"id":"6bec94ea-71cf-49c9-9b0c-7fdb9d611e06","block_type":"box","text":"by foreign investors on the disposal of PRC equity interests.","page_number":77,"box":{"x":69,"y":559,"width":425,"height":11}},{"id":"d1562603-07a8-49a0-a719-81cdf40819de","block_type":"box","text":"There are however cer tain tax exemptions available, some temporary in nature, highlighted below.","page_number":77,"box":{"x":101,"y":582,"width":697,"height":11}},{"id":"06b00f37-9973-43f4-8499-4636aa1c1f7a","block_type":"box","text":"On November 14, 2014, the Ministry of Finance (“MoF”), China Securities Regulatory Commission and the State","page_number":77,"box":{"x":102,"y":604,"width":803,"height":11}},{"id":"404c8504-2965-4ad9-af87-e5650fca9d85","block_type":"box","text":"Taxation Administration (“STA”), acting with State Council’s approval, jointly released Circular 79, which temporarily","page_number":77,"box":{"x":68,"y":619,"width":822,"height":11}},{"id":"d1526c25-fb55-4b84-a465-89c005cd5fd4","block_type":"box","text":"exempts Qualified Foreign Institutional Investors (“QFIIs”) and Renminbi Qualified Foreign Institutional Investors","page_number":77,"box":{"x":69,"y":634,"width":794,"height":12}},{"id":"1421bd94-aede-4477-8c94-5dd731437e87","block_type":"box","text":"(“RQFIIs”) from tax on capital gains derived from the trading of shares and other equity interest investments on or","page_number":77,"box":{"x":69,"y":649,"width":812,"height":12}},{"id":"698694b3-7bda-4812-b541-6b1720110d8b","block_type":"box","text":"after November 17, 2014. Subsequently, Circulars 81 and 127 were issued to temporarily exempt tax on capital","page_number":77,"box":{"x":69,"y":664,"width":800,"height":12}},{"id":"37b501f2-7d86-48f8-97f2-899989cb9336","block_type":"box","text":"gains derived from trading of equity securities of companies domiciled in the PRC that trade on Chinese stock","page_number":77,"box":{"x":68,"y":680,"width":783,"height":11}},{"id":"72c72249-ca00-47f2-81f0-cc39c32531bc","block_type":"box","text":"exchanges (“A-Shares”) through the Shanghai-Hong Kong Stock Connect program or the Shenzhen-Hong Kong Stock","page_number":77,"box":{"x":69,"y":695,"width":825,"height":11}},{"id":"8fc0a65b-cc74-4e07-90fd-3d08475fa426","block_type":"box","text":"Connect program, as applicable (each, a “Stock Connect” and collectively, “Stock Connects”). The duration of the","page_number":77,"box":{"x":69,"y":710,"width":809,"height":11}},{"id":"6019ce67-1b18-4c6d-9965-508154aba12f","block_type":"box","text":"temporary exemptions is not stated in the circulars and is subject to termination by the PRC tax authorities with or","page_number":77,"box":{"x":68,"y":725,"width":818,"height":11}},{"id":"b14623d0-899f-4f5b-9339-3cef2443b315","block_type":"box","text":"without notice.","page_number":77,"box":{"x":68,"y":740,"width":103,"height":9}},{"id":"74560792-c8df-4898-a3e8-dcbd41a36bd9","block_type":"box","text":"On November 22, 2018, the MoF and STA jointly issued Circular 108 which states that foreign institutional","page_number":77,"box":{"x":102,"y":763,"width":759,"height":11}},{"id":"1170c545-ea82-4bf2-9aa3-3b995c4644c9","block_type":"box","text":"investors are temporarily exempt from withholding income tax with respect to interest income on bonds derived from","page_number":77,"box":{"x":70,"y":778,"width":827,"height":11}},{"id":"c60a1a62-505a-426d-9132-e3df640a0ff8","block_type":"box","text":"the PRC bond market from November 7, 2018 to November 6, 2021. On November 22, 2021, the MoF and STA","page_number":77,"box":{"x":68,"y":793,"width":798,"height":10}},{"id":"36d0fc30-8787-4312-83b2-cd94e8312e6c","block_type":"box","text":"issued Public Notice 34 to extend the temporary exemption from November 7, 2021 to December 31, 2025. On","page_number":77,"box":{"x":70,"y":808,"width":798,"height":11}},{"id":"c247c7c8-223f-495b-85ed-e689ddfb758a","block_type":"box","text":"January 15, 2026, it was announced via Public Notice No. 5 of 2026 that the exemption was extended through","page_number":77,"box":{"x":69,"y":823,"width":792,"height":12}},{"id":"abda343d-ed00-4c31-ae6b-126839b3ab46","block_type":"box","text":"December 31, 2027.","page_number":77,"box":{"x":70,"y":838,"width":147,"height":11}},{"id":"f0279298-78ec-4a98-bb1a-2140fbbb3523","block_type":"box","text":"Value Added Tax (“VAT”) Risk —","page_number":77,"box":{"x":103,"y":861,"width":225,"height":11}},{"id":"e8778642-fc4c-4ffe-ac4b-a07a20eee1cf","block_type":"box","text":"From May 1, 2016, VAT applies to cer tain income derived by the Fund, including","page_number":77,"box":{"x":333,"y":861,"width":569,"height":11}},{"id":"e1e38a56-1224-4c6d-9423-af5309742fb1","block_type":"box","text":"PRC sourced interest income on non-government bonds and trading gains.","page_number":77,"box":{"x":69,"y":876,"width":528,"height":11}},{"id":"1f0161cb-4aeb-4b36-8a66-21142370e56e","block_type":"box","text":"There are however cer tain tax exemptions available, some temporary in nature, highlighted below.","page_number":77,"box":{"x":101,"y":899,"width":697,"height":11}},{"id":"41a80cd5-4f97-4a63-ab2d-ecbd59af7d8e","block_type":"box","text":"II-46","page_number":77,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"4aa6c66e-61a6-4118-bc4c-5cf6f7842d8b","block_type":"box","text":"NM1026U-5982568-77/232","page_number":77,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"3342ea55-0c0c-46f3-95f9-2caeac979180","block_type":"box","text":"VAT exemptions currently apply to capital gains from trading of QFII and RQFII products, A-Shares traded on the","page_number":78,"box":{"x":101,"y":45,"width":789,"height":11}},{"id":"f89a3348-e6e3-4b49-984a-9bcb8a632abf","block_type":"box","text":"Stock Connects and debt securities traded in the China Interbank Bond Market.","page_number":78,"box":{"x":69,"y":60,"width":565,"height":9}},{"id":"069083f0-b50c-40c6-926e-d4f8da3055f3","block_type":"box","text":"On November 7, 2018, the MoF and STA jointly issued Circular 108 which states that foreign institutional","page_number":78,"box":{"x":102,"y":82,"width":749,"height":12}},{"id":"dc6160e3-70b0-46b1-8b4e-0045c001f594","block_type":"box","text":"investors are temporarily exempt from VAT with respect to interest income on bonds derived from the PRC bond","page_number":78,"box":{"x":70,"y":98,"width":791,"height":11}},{"id":"d50f2c83-5566-4346-9c11-044b58c1629b","block_type":"box","text":"market from November 7, 2018 to November 6, 2021. On November 22, 2021, the MoF and STA jointly issued Public","page_number":78,"box":{"x":69,"y":113,"width":840,"height":11}},{"id":"0b540ef9-a2f7-402b-a78e-1ec2f34405d2","block_type":"box","text":"Notice 34 to extend the temporary exemption from November 7, 2021 to December 31, 2025. However, on","page_number":78,"box":{"x":70,"y":128,"width":766,"height":11}},{"id":"b516f39b-3cb1-4895-bbff-08bc45866c74","block_type":"box","text":"July 31, 2025, the MoF and STA jointly issued Public Notice No 4 of 2025, stating that VAT will apply with respect to","page_number":78,"box":{"x":69,"y":143,"width":826,"height":11}},{"id":"5b9389cd-28ac-48e6-941d-c8ff8ac6bb4f","block_type":"box","text":"interest income derived from treasury bonds, local government bonds and financial bonds issued on or after","page_number":78,"box":{"x":70,"y":158,"width":772,"height":11}},{"id":"e52bb2c3-1979-4a50-9ab8-b7db95af1c47","block_type":"box","text":"August 8, 2025. It is understood that Public Notice No 4 of 2025 does not supersede the afore-mentioned exemption","page_number":78,"box":{"x":68,"y":173,"width":840,"height":11}},{"id":"482dfb0f-edb8-41ed-bc00-65f4869af752","block_type":"box","text":"for foreign institutional investors. This exemption was extended through December 31, 2027.","page_number":78,"box":{"x":68,"y":188,"width":665,"height":12}},{"id":"8b4381b7-9ef6-4d13-b325-5333360e8b58","block_type":"box","text":"Any changes in PRC tax law, future clarifications thereof, and/or subsequent retroactive enforcement by the PRC","page_number":78,"box":{"x":101,"y":211,"width":801,"height":11}},{"id":"239b7927-e765-4662-a557-d998db6d1bcf","block_type":"box","text":"tax authorities may result in a loss which could be material to the Fund. There is a risk the PRC tax authorities may","page_number":78,"box":{"x":68,"y":226,"width":821,"height":11}},{"id":"05303c55-637e-43ee-9540-aadcc4506333","block_type":"box","text":"withdraw the temporary tax exemptions in the future and seek to collect taxes realized on the sale of A-Shares or","page_number":78,"box":{"x":68,"y":241,"width":808,"height":11}},{"id":"5cd3bc24-0513-4aab-9d2f-b088661899f1","block_type":"box","text":"PRC sourced interest income on non-government bonds received by the Fund without giving any prior notice. If the","page_number":78,"box":{"x":69,"y":256,"width":810,"height":12}},{"id":"a528aba6-cb0a-4719-bcd6-cdc4b3594143","block_type":"box","text":"temporary tax exemptions are withdrawn, any taxes may be directly borne by or indirectly passed on to the Fund and","page_number":78,"box":{"x":68,"y":272,"width":829,"height":11}},{"id":"97ce1596-328a-481b-b9f7-4825a30dbb69","block_type":"box","text":"may result in a substantial impact to its net asset value. As with any net asset value adjustment, investors may be","page_number":78,"box":{"x":69,"y":287,"width":819,"height":11}},{"id":"f5f696be-a461-48e5-817a-3d7ab62dc828","block_type":"box","text":"advantaged or disadvantaged depending on when the investors purchased and/or sold the shares of the Fund. There","page_number":78,"box":{"x":69,"y":302,"width":833,"height":11}},{"id":"879477a2-5b39-474b-8f15-ca39785eaa3b","block_type":"box","text":"will be no retrospective restatement of the Fund’s net asset value.","page_number":78,"box":{"x":68,"y":317,"width":474,"height":11}},{"id":"2404638c-ef16-40c9-b1e9-cfeb8de94b5a","block_type":"box","text":"BlackRock will keep the provisioning policy for tax liability under review and may, in its discretion from time to","page_number":78,"box":{"x":102,"y":339,"width":777,"height":12}},{"id":"8279c8d1-e5ab-4316-9c13-91bde7209cde","block_type":"box","text":"time, make a provision for potential tax liabilities if in its opinion such provision is warranted or as fur ther clarified by","page_number":78,"box":{"x":68,"y":355,"width":836,"height":11}},{"id":"116c11a2-4c7f-4f07-b846-c73d1908c6cb","block_type":"box","text":"the PRC in notifications.","page_number":78,"box":{"x":68,"y":370,"width":171,"height":9}},{"id":"1adababe-afaf-4e47-8c37-0df25e11245d","block_type":"box","text":"Investment in Other Investment Companies.","page_number":78,"box":{"x":102,"y":392,"width":320,"height":11}},{"id":"6fa53ada-1b85-428e-90cc-68d6be352309","block_type":"box","text":"Each Fund may, subject to applicable law, invest in other","page_number":78,"box":{"x":429,"y":393,"width":402,"height":11}},{"id":"7d30109c-9aad-4674-9a05-b645010922ff","block_type":"box","text":"investment companies (including investment companies managed by BlackRock and its affiliates), including money","page_number":78,"box":{"x":70,"y":407,"width":818,"height":12}},{"id":"d7346d4d-f69e-423a-a6fe-46d293eeef87","block_type":"box","text":"market funds and ETFs, which are typically open-end funds or unit investment trusts listed on a stock exchange.","page_number":78,"box":{"x":69,"y":423,"width":797,"height":11}},{"id":"322b3739-e4f1-417c-9cac-30aef04ae791","block_type":"box","text":"Under Section 12(d)(1)(A) of the Investment Company Act, however, a Fund may invest up to 10% of its total assets","page_number":78,"box":{"x":70,"y":438,"width":822,"height":11}},{"id":"a170718b-dda0-4083-b4e2-e48ebe0b14d1","block_type":"box","text":"in securities of other investment companies (measured at the time of such investment). In addition, under Section","page_number":78,"box":{"x":70,"y":453,"width":814,"height":11}},{"id":"989a47bb-430f-4c60-97dd-490264ee295d","block_type":"box","text":"12(d)(1)(A) of the Investment Company Act a Fund may not acquire securities of an investment company if such","page_number":78,"box":{"x":70,"y":468,"width":793,"height":11}},{"id":"e067f84d-fdf6-42df-979c-9270896d1145","block_type":"box","text":"acquisition would cause the Fund to own more than 3% of the total outstanding voting stock of such investment","page_number":78,"box":{"x":69,"y":483,"width":796,"height":11}},{"id":"1ddf8370-1fc0-4c85-96c2-553872bc51d3","block_type":"box","text":"company and a Fund may not invest in another investment company if such investment would cause more than 5% of","page_number":78,"box":{"x":69,"y":498,"width":837,"height":11}},{"id":"6c11a045-40af-47a0-9a0d-a442159137d2","block_type":"box","text":"the value of the Fund’s total assets to be invested in securities of such investment company. (These limits do not","page_number":78,"box":{"x":68,"y":513,"width":812,"height":11}},{"id":"9cd872c0-7152-4877-8fe9-3fe7a6fbb37e","block_type":"box","text":"restrict a Feeder Fund from investing all of its assets in shares of its Master Por tfolio.) In addition to the restrictions","page_number":78,"box":{"x":69,"y":528,"width":829,"height":12}},{"id":"767c292a-fcff-419d-b760-8c5a79ff4f51","block_type":"box","text":"on investing in other investment companies discussed above, under Section 12(d)(1)(C) of the Investment Company","page_number":78,"box":{"x":69,"y":543,"width":827,"height":12}},{"id":"6d2790e2-3a8a-4d91-916b-e78bcfbf557e","block_type":"box","text":"Act a Fund may not invest in a registered closed-end investment company if such investment would cause the Fund","page_number":78,"box":{"x":68,"y":559,"width":821,"height":11}},{"id":"075dac92-0ce4-43db-80e3-1546b5401bfa","block_type":"box","text":"and other BlackRock-advised investment companies to own more than 10% of the total outstanding voting stock of","page_number":78,"box":{"x":69,"y":574,"width":817,"height":11}},{"id":"def92983-04c2-4d1f-a34d-d72ec2a91b50","block_type":"box","text":"such closed-end investment company. Pursuant to Section 12(d)(1)(G) of the Investment Company Act, these","page_number":78,"box":{"x":69,"y":589,"width":776,"height":11}},{"id":"15380cc6-b8be-49bc-b5c3-22187c7f477b","block_type":"box","text":"percentage limitations do not apply to investments in affiliated investment companies, including ETFs, subject to","page_number":78,"box":{"x":70,"y":604,"width":802,"height":11}},{"id":"7ac51134-2a24-4158-9add-be571575d661","block_type":"box","text":"cer tain conditions. In addition, a Fund may be able to rely on cer tain rules under the Investment Company Act to","page_number":78,"box":{"x":69,"y":619,"width":801,"height":11}},{"id":"0f1000e7-3960-4e54-84f3-d9544ee95e23","block_type":"box","text":"invest in shares of money market funds or other investment companies beyond the statutory limits noted above, but","page_number":78,"box":{"x":70,"y":634,"width":829,"height":11}},{"id":"4efa1c4e-c21c-4721-bdbf-9714be1f9e86","block_type":"box","text":"subject to cer tain conditions.","page_number":78,"box":{"x":69,"y":650,"width":206,"height":10}},{"id":"55571a8e-52c5-44ee-acba-9ad0ca8de3bc","block_type":"box","text":"As with other investments, investments in other investment companies are subject to market and selection risk.","page_number":78,"box":{"x":101,"y":672,"width":799,"height":11}},{"id":"e66f643f-4764-41d5-9d6d-295fdb7b2782","block_type":"box","text":"Shares of investment companies, such as closed-end fund investment companies, that trade on an exchange","page_number":78,"box":{"x":102,"y":695,"width":779,"height":11}},{"id":"71e6c1ab-d909-413f-afda-fd095b4b0e1e","block_type":"box","text":"may at times be acquired at market prices representing premiums to their NAVs. In addition, investment companies","page_number":78,"box":{"x":69,"y":710,"width":824,"height":11}},{"id":"5be0b73a-c844-4a49-a463-f85e626d7e82","block_type":"box","text":"held by a Fund that trade on an exchange could trade at a discount from NAV, and such discount could increase while","page_number":78,"box":{"x":69,"y":725,"width":836,"height":11}},{"id":"5f5d3255-a74f-47c8-b1e9-f1c5175b7622","block_type":"box","text":"the Fund holds the shares. If the market price of shares of an exchange-traded investment company decreases below","page_number":78,"box":{"x":68,"y":740,"width":839,"height":11}},{"id":"93d585ea-ded8-4090-a6dc-20f45d25a76b","block_type":"box","text":"the price that the Fund paid for the shares and the Fund were to sell its shares of such investment company at a","page_number":78,"box":{"x":68,"y":755,"width":806,"height":11}},{"id":"68e004cc-d87a-482d-a7ba-b08ce8b27a8b","block_type":"box","text":"time when the market price is lower than the price at which it purchased the shares, the Fund would experience a","page_number":78,"box":{"x":68,"y":771,"width":810,"height":10}},{"id":"c53d1ea3-c185-409a-84c5-4653d9d13eee","block_type":"box","text":"loss.","page_number":78,"box":{"x":70,"y":786,"width":31,"height":8}},{"id":"e093d8e8-bc39-4e66-88a8-7b20b6c8f0b2","block_type":"box","text":"In addition, if a Fund acquires shares in investment companies, including affiliated investment companies,","page_number":78,"box":{"x":102,"y":808,"width":758,"height":11}},{"id":"30fca662-c0f3-4337-977e-af8db4179c5d","block_type":"box","text":"shareholders would bear both their propor tionate share of expenses in the Fund and, indirectly, the expenses of such","page_number":78,"box":{"x":69,"y":823,"width":837,"height":11}},{"id":"68922cd9-4bac-4b4b-9dd4-1843510b3da6","block_type":"box","text":"investment companies. Such expenses, both at the Fund level and acquired investment company level, would include","page_number":78,"box":{"x":70,"y":838,"width":835,"height":11}},{"id":"981d5be3-0fe4-409d-8302-eb5d0ce49ba9","block_type":"box","text":"management and advisory fees, unless such fees have been waived by BlackRock. Please see the relevant Fund’s","page_number":78,"box":{"x":69,"y":853,"width":816,"height":12}},{"id":"d2fbaa70-c958-4862-9ea3-19b907471148","block_type":"box","text":"Prospectus to determine whether any such management and advisory fees have been waived by BlackRock.","page_number":78,"box":{"x":69,"y":869,"width":768,"height":11}},{"id":"67a8014c-76b4-4d3a-8193-e6cadb2e0179","block_type":"box","text":"Investments by a Fund in wholly owned investment entities created under the laws of cer tain countries will not be","page_number":78,"box":{"x":70,"y":884,"width":807,"height":11}},{"id":"d6b7b55c-7205-40f6-ae5b-00dc1d637057","block_type":"box","text":"deemed an investment in other investment companies. Pursuant to guidance issued by the staff of the Commission,","page_number":78,"box":{"x":69,"y":899,"width":830,"height":11}},{"id":"080d6a73-5e5c-4687-b01d-24c15855b2d4","block_type":"box","text":"II-47","page_number":78,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"270a96e8-8e45-4aac-8c6a-44a435296d61","block_type":"box","text":"NM1026U-5982568-78/232","page_number":78,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"d298ffbe-4741-4765-99c1-f6e6d7a152b4","block_type":"box","text":"fees and expenses of money market funds used for the investment of cash collateral received in connection with","page_number":79,"box":{"x":68,"y":45,"width":804,"height":11}},{"id":"90df5f0d-0a6b-4bc4-abd0-c60884bdbf1b","block_type":"box","text":"loans of Fund securities are not treated as “acquired fund fees and expenses,” which are fees and expenses","page_number":79,"box":{"x":70,"y":60,"width":778,"height":11}},{"id":"871abffe-c581-4663-9cac-b68e7ccf14cf","block_type":"box","text":"charged by other investment companies and pooled investment vehicles in which a Fund invests a por tion of its","page_number":79,"box":{"x":69,"y":75,"width":796,"height":11}},{"id":"cc356863-2124-4924-8c83-21928eec8072","block_type":"box","text":"assets.","page_number":79,"box":{"x":69,"y":91,"width":51,"height":8}},{"id":"63827c5e-655a-4b4e-88e2-b283d79e1b34","block_type":"box","text":"To the extent shares of a Fund are held by another fund, the ability of the Fund itself to purchase other funds","page_number":79,"box":{"x":101,"y":113,"width":776,"height":11}},{"id":"cfb0231e-b503-44d8-8c92-90ef868fa483","block_type":"box","text":"may be limited. In addition, a fund-of-funds (","page_number":79,"box":{"x":69,"y":128,"width":313,"height":11}},{"id":"922f5104-ae17-4ca2-8123-466ade85cbe4","block_type":"box","text":"e.g.","page_number":79,"box":{"x":384,"y":129,"width":24,"height":10}},{"id":"4b5d7f04-7007-4448-82b5-770d517fd885","block_type":"box","text":", an investment company that seeks to meet its investment objective","page_number":79,"box":{"x":411,"y":128,"width":491,"height":11}},{"id":"138fabf4-5980-4559-be80-e1fb4c12713e","block_type":"box","text":"by investing significantly in other investment companies) may be limited in its ability to purchase underlying funds if","page_number":79,"box":{"x":69,"y":143,"width":823,"height":11}},{"id":"e32130d1-87a7-4746-9fc6-183d13253f3f","block_type":"box","text":"such underlying funds themselves own shares of underlying funds.","page_number":79,"box":{"x":69,"y":158,"width":472,"height":11}},{"id":"6d6a0b1e-3256-450c-b677-c0ff60f87c44","block_type":"box","text":"A number of publicly traded closed-end investment companies have been organized to facilitate indirect foreign","page_number":79,"box":{"x":101,"y":181,"width":790,"height":11}},{"id":"c039ef04-a421-4af4-a0a3-6c88dab20772","block_type":"box","text":"investment in developing countries, and cer tain of such countries, such as Thailand, South Korea, Chile and Brazil,","page_number":79,"box":{"x":70,"y":196,"width":818,"height":11}},{"id":"a7cc81bc-0532-4b55-a385-bed41d2f72d5","block_type":"box","text":"have specifically authorized such funds. There also are investment oppor tunities in cer tain of such countries in","page_number":79,"box":{"x":69,"y":211,"width":791,"height":11}},{"id":"371f558a-d4ca-4067-a209-c6d9aebeafbe","block_type":"box","text":"pooled vehicles that resemble open-end investment companies. The restrictions on investments in securities of","page_number":79,"box":{"x":70,"y":226,"width":795,"height":11}},{"id":"3588a609-92d1-4882-9217-5bcc803fd294","block_type":"box","text":"investment companies set for th above may limit oppor tunities for a Fund to invest indirectly in cer tain developing","page_number":79,"box":{"x":70,"y":241,"width":807,"height":11}},{"id":"fb57a583-ff9e-4bdf-8811-c7a0a70356d8","block_type":"box","text":"countries.","page_number":79,"box":{"x":69,"y":257,"width":69,"height":8}},{"id":"fc04be84-96cd-47f2-b0d2-eea11a0fd2c4","block_type":"box","text":"Issuer Insolvency Risk.","page_number":79,"box":{"x":102,"y":279,"width":166,"height":11}},{"id":"e3a1576d-605e-4be0-8625-05d6ec8985ac","block_type":"box","text":"Cer tain Funds’ potential exposure to financially or operationally troubled issuers involves","page_number":79,"box":{"x":275,"y":279,"width":631,"height":11}},{"id":"3f393223-32bd-45ab-9b36-36248bf1e421","block_type":"box","text":"a high degree of credit and market risk, which may be heightened during an economic downturn or recession. Should","page_number":79,"box":{"x":69,"y":294,"width":832,"height":11}},{"id":"135c9ff4-1e6e-4e3d-8cfa-7ea9bc6c9995","block_type":"box","text":"an issuer of securities held by a Fund become involved in a bankruptcy proceeding, reorganization or financial","page_number":79,"box":{"x":69,"y":309,"width":781,"height":11}},{"id":"90e20d98-3f24-4a49-840f-56f902789915","block_type":"box","text":"restructuring, a wide variety of considerations make an evaluation of the outcome of the Fund’s exposure to the","page_number":79,"box":{"x":69,"y":324,"width":797,"height":12}},{"id":"ee5b828e-dd1b-41be-905e-ed17061be0ff","block_type":"box","text":"issuer uncer tain.","page_number":79,"box":{"x":70,"y":340,"width":118,"height":8}},{"id":"232f0a3c-d6d8-43b5-bc12-d75ff2a15fc1","block_type":"box","text":"During the period of a bankruptcy proceeding, reorganization or financial restructuring, it is unlikely that a Fund","page_number":79,"box":{"x":102,"y":362,"width":788,"height":11}},{"id":"e43f113c-d9b4-4e25-8da5-a7f0de0060cb","block_type":"box","text":"will receive any interest payments on the securities of the issuer. A Fund will be subject to significant uncer tainty as","page_number":79,"box":{"x":68,"y":377,"width":827,"height":12}},{"id":"49d99f7e-c99a-4762-8662-1ee27687b8ff","block_type":"box","text":"to whether the reorganization or restructuring will be completed, and the Fund may bear cer tain extraordinary","page_number":79,"box":{"x":68,"y":393,"width":779,"height":11}},{"id":"a2435d2e-aa6f-4c92-953f-58799e4a4826","block_type":"box","text":"expenses to protect and recover its investment. A Fund will also be subject to significant uncer tainty as to when and","page_number":79,"box":{"x":69,"y":407,"width":829,"height":12}},{"id":"a264c4e8-54e5-49ff-af3b-1794ce9f760d","block_type":"box","text":"in what manner and for what value the obligations evidenced by the securities of the issuer held by the Fund will","page_number":79,"box":{"x":70,"y":423,"width":797,"height":11}},{"id":"c6f5724a-fd2d-44f6-9a1b-03f639557541","block_type":"box","text":"eventually be satisfied.","page_number":79,"box":{"x":69,"y":438,"width":162,"height":11}},{"id":"4e703491-10dc-4d2e-9c9f-970e3d43d197","block_type":"box","text":"Even if a plan of reorganization or restructuring is adopted with respect to the securities of the issuer held by the","page_number":79,"box":{"x":102,"y":460,"width":805,"height":12}},{"id":"e7609fd0-fa73-41df-92e0-0d31128a97dc","block_type":"box","text":"Fund, there can be no assurance that the securities or other assets received by a Fund in connection with such plan","page_number":79,"box":{"x":70,"y":476,"width":827,"height":11}},{"id":"ebaa7fc1-b0b2-4c9e-9043-d625a0c4fa00","block_type":"box","text":"of reorganization or restructuring will not have a lower value or income potential than may have been anticipated or","page_number":79,"box":{"x":69,"y":491,"width":819,"height":11}},{"id":"67b565bf-8baf-47d0-ae1b-2b7955782252","block_type":"box","text":"no value. A Fund may be unable to enforce its claims or rights in any collateral or may have its claims or security","page_number":79,"box":{"x":69,"y":506,"width":802,"height":11}},{"id":"573a12a7-6a20-4f6f-a174-444b997ce50e","block_type":"box","text":"interest in any collateral challenged, disallowed or subordinated to the claims or security interests of other creditors.","page_number":79,"box":{"x":70,"y":521,"width":830,"height":11}},{"id":"dfde26ca-7012-4a96-80b3-77b3192f0a2f","block_type":"box","text":"In addition, amendments to the U.S. Bankruptcy Code or other relevant laws could alter the expected outcome or","page_number":79,"box":{"x":70,"y":536,"width":805,"height":11}},{"id":"3e69cf07-8da9-46fa-ad34-03d2cc8a8590","block_type":"box","text":"introduce greater uncer tainty regarding the outcome of the Fund’s securities holdings in the issuer. In a bankruptcy","page_number":79,"box":{"x":70,"y":551,"width":820,"height":11}},{"id":"40bf0a78-6373-4be9-9d54-63a38a0b6822","block_type":"box","text":"proceeding, a reorganization or restructuring, the securities of the issuer held by a Fund could be re-characterized or","page_number":79,"box":{"x":70,"y":566,"width":828,"height":11}},{"id":"d37e91eb-62f9-4320-9380-e4cddcd2687d","block_type":"box","text":"a Fund may receive different securities or other assets, including equity securities. These types of equity securities","page_number":79,"box":{"x":69,"y":581,"width":820,"height":12}},{"id":"6e5e87e3-2a19-4657-b0db-0ac281dcd438","block_type":"box","text":"include, but are not limited to: common stock; preferred stock (including conver tible preferred stock); bonds, notes","page_number":79,"box":{"x":70,"y":596,"width":820,"height":12}},{"id":"0efe4c8b-8e7d-4dcd-ac73-9dea445c9daa","block_type":"box","text":"and debentures conver tible into common or preferred stock; stock purchase warrants and rights; equity interests in","page_number":79,"box":{"x":69,"y":612,"width":824,"height":11}},{"id":"bbe3433b-8f97-4a91-b701-ad713f79c763","block_type":"box","text":"trusts; and depositary receipts. Equity securities are subject to changes in value, and their value may be more","page_number":79,"box":{"x":68,"y":627,"width":788,"height":11}},{"id":"b388e7ca-f59a-4316-883e-788fcf6a9fcf","block_type":"box","text":"volatile than those of other asset classes. Holders of equity securities are subject to more risk than holders of debt","page_number":79,"box":{"x":68,"y":642,"width":826,"height":11}},{"id":"2144abc0-bf01-4719-9afa-23667d969d0f","block_type":"box","text":"securities because the status of equity holders is subordinate to debtholders in an issuer’s capital structure. The","page_number":79,"box":{"x":69,"y":657,"width":809,"height":11}},{"id":"c060128f-3921-4e4c-9213-074472d8b96c","block_type":"box","text":"value of equity securities received by a Fund could decline if the financial condition of the issuer deteriorates or if","page_number":79,"box":{"x":68,"y":672,"width":809,"height":11}},{"id":"7891817c-ce96-480d-ad92-48598d85973a","block_type":"box","text":"overall market and economic conditions, or conditions within the issuer’s region or industry, deteriorate.","page_number":79,"box":{"x":69,"y":687,"width":741,"height":11}},{"id":"cd2984b1-ab52-4b8f-b437-539f56ce3045","block_type":"box","text":"To the extent that a Fund receives other assets in connection with a bankruptcy proceeding, reorganization or","page_number":79,"box":{"x":101,"y":710,"width":780,"height":11}},{"id":"fbeaaf1b-a295-4870-9116-eb7a34ecf8b3","block_type":"box","text":"financial restructuring, the Fund may also be subject to additional risks associated with the assets received. One","page_number":79,"box":{"x":68,"y":725,"width":807,"height":11}},{"id":"a605aa9f-415f-43bb-b3fc-d50611b2d2c1","block_type":"box","text":"example of assets that a Fund could receive is an interest in one or more loans made to the issuer as par t of a","page_number":79,"box":{"x":69,"y":740,"width":795,"height":11}},{"id":"c4c87b38-09df-4d5e-b964-abc247f9c909","block_type":"box","text":"workout agreed to by a consor tium of lienholders and creditors of the issuer. A Fund may receive such interests in","page_number":79,"box":{"x":68,"y":755,"width":814,"height":11}},{"id":"e37b9f2c-60a6-4900-a7eb-70cf96635279","block_type":"box","text":"loans to the extent permitted by the Investment Company Act.","page_number":79,"box":{"x":70,"y":770,"width":439,"height":11}},{"id":"93b14856-0925-4e9e-afce-82beab8cb174","block_type":"box","text":"Securities or other assets received in a reorganization or restructuring typically entail a higher degree of risk than","page_number":79,"box":{"x":102,"y":793,"width":806,"height":11}},{"id":"af894c0d-d6fd-4f2d-ab2a-f7eafb22e622","block_type":"box","text":"investments in securities of issuers that have not undergone a reorganization or restructuring and may be subject to","page_number":79,"box":{"x":70,"y":808,"width":829,"height":11}},{"id":"87ff31b7-6055-45c9-b9c1-95f1e47f8db1","block_type":"box","text":"heavy selling or downward pricing pressure after completion of the reorganization or restructuring. The post","page_number":79,"box":{"x":69,"y":823,"width":767,"height":12}},{"id":"3b1a3370-9438-4003-b769-700276355bda","block_type":"box","text":"reorganization/restructuring assets and securities may also be illiquid and difficult to sell or value. If a Fund","page_number":79,"box":{"x":69,"y":838,"width":771,"height":12}},{"id":"cd1eeefa-2e08-4279-880b-04be36dac738","block_type":"box","text":"par ticipates in negotiations with respect to a plan of reorganization or restructuring with respect to securities of the","page_number":79,"box":{"x":70,"y":853,"width":823,"height":12}},{"id":"401d3296-978b-474d-94d0-cd84f260ad7b","block_type":"box","text":"issuer held by a Fund, the Fund also may be restricted from disposing such securities for a period of time. If a Fund","page_number":79,"box":{"x":70,"y":869,"width":822,"height":11}},{"id":"5823f261-934d-4c12-8ffb-569a96308a53","block_type":"box","text":"becomes involved in such proceedings, the Fund may have more active par ticipation in the affairs of the issuer than","page_number":79,"box":{"x":69,"y":884,"width":828,"height":11}},{"id":"7126cc4a-a03e-4c6c-948d-2714eeeffc5a","block_type":"box","text":"that assumed generally by an investor.","page_number":79,"box":{"x":68,"y":899,"width":274,"height":11}},{"id":"684f734f-a113-48e2-9d20-6eecab8dccc9","block_type":"box","text":"II-48","page_number":79,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"c9afd25d-734b-49c9-a8e1-edefb08b98ab","block_type":"box","text":"NM1026U-5982568-79/232","page_number":79,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"291c81cd-7b6a-4b6b-84ee-1d84391676c8","block_type":"box","text":"Lease Obligations.","page_number":80,"box":{"x":102,"y":45,"width":133,"height":11}},{"id":"44616de4-b3e0-4cea-a6c6-97cc61f81840","block_type":"box","text":"A Fund may hold par ticipation cer tificates in a lease, an installment purchase contract, or a","page_number":80,"box":{"x":241,"y":45,"width":653,"height":11}},{"id":"a95d4924-242f-40a1-bdcf-21a523b12ae8","block_type":"box","text":"conditional sales contract (“lease obligations”). The Manager will monitor the credit standing of each borrower and","page_number":80,"box":{"x":69,"y":60,"width":816,"height":11}},{"id":"65853e5d-ecc7-4d21-9f66-0d70ee69a99b","block_type":"box","text":"each entity providing credit suppor t and/or a put option relating to lease obligations.","page_number":80,"box":{"x":69,"y":75,"width":602,"height":11}},{"id":"20cbca2d-cd59-41e1-8215-f433f44a633a","block_type":"box","text":"Life Settlement Investments.","page_number":80,"box":{"x":102,"y":98,"width":210,"height":9}},{"id":"2bc5dbc3-850e-4585-904e-037935a2b18d","block_type":"box","text":"A Fund may invest in life settlements, which are sales to third par ties, such as the","page_number":80,"box":{"x":318,"y":98,"width":589,"height":11}},{"id":"97be3372-c621-444d-8a60-c73122c27e8f","block_type":"box","text":"Fund, of existing life insurance contracts for more than their cash surrender value but less than the net benefits to be","page_number":80,"box":{"x":70,"y":113,"width":838,"height":11}},{"id":"f482547e-d8ea-4935-b2da-43c27e3986ae","block_type":"box","text":"paid under the policies. When a Fund acquires such a contract, it pays the policy premiums in return for the expected","page_number":80,"box":{"x":70,"y":128,"width":834,"height":11}},{"id":"1ab721fd-e6c2-4345-a692-f7e190bcb502","block_type":"box","text":"receipt of the net benefit as the beneficiary under the policy. Investments in these contracts involve cer tain risks,","page_number":80,"box":{"x":69,"y":143,"width":808,"height":11}},{"id":"a073438f-d2d4-424d-8cbd-3b8fdf59d14f","block_type":"box","text":"including liquidity risk, credit risk of the insurance company, and inaccurate estimations of life expectancy of the","page_number":80,"box":{"x":70,"y":158,"width":797,"height":11}},{"id":"18063518-b451-452f-9eeb-65cf31e053f3","block_type":"box","text":"insured individuals (viators). These policies may be considered illiquid because they are bought and sold in a","page_number":80,"box":{"x":70,"y":173,"width":775,"height":11}},{"id":"828e05cb-ae8a-4122-9782-39a38e481e5b","block_type":"box","text":"secondary market through life settlement agents. Also, in the event of a bankruptcy of the insurance carrier for a","page_number":80,"box":{"x":69,"y":188,"width":805,"height":12}},{"id":"1cf35f90-af87-4bf3-bee6-75b225b1448e","block_type":"box","text":"policy, the Fund may receive reduced or no benefits under the contract. A Fund seeks to minimize credit risk by","page_number":80,"box":{"x":70,"y":203,"width":789,"height":12}},{"id":"f1c0fcb4-0f5f-4cfa-81fe-02110692fdea","block_type":"box","text":"investing in policies issued by a diverse range of highly-rated insurance carriers. Fur thermore, a Fund may encounter","page_number":80,"box":{"x":70,"y":218,"width":829,"height":12}},{"id":"b452a377-6f31-42d4-8a44-ba2f8de53029","block_type":"box","text":"losses on its investments if there is an inaccurate estimation of the life expectancies of viators. A Fund intends to","page_number":80,"box":{"x":70,"y":234,"width":813,"height":11}},{"id":"d4e1c043-c18b-4e13-9730-90f9cbd83255","block_type":"box","text":"reduce this life expectancy risk by investing only in contracts where the life expectancy was reviewed by an","page_number":80,"box":{"x":69,"y":249,"width":758,"height":11}},{"id":"ee51ab68-d8f1-4277-972d-f6288f782d15","block_type":"box","text":"experienced actuary, as well as by diversifying its investments across viators of varying ages and medical profiles. In","page_number":80,"box":{"x":69,"y":264,"width":832,"height":11}},{"id":"06939991-7d4b-40f3-989b-e05364781c16","block_type":"box","text":"addition, it is unclear whether the income from life settlements is qualifying income for purposes of the IRS 90%","page_number":80,"box":{"x":69,"y":279,"width":800,"height":11}},{"id":"31aa21d1-0d59-4472-b11f-ad845e7ab5eb","block_type":"box","text":"gross income test a Fund must satisfy each year to qualify as a regulated investment company. A Fund intends to","page_number":80,"box":{"x":68,"y":294,"width":809,"height":11}},{"id":"1917a975-d33a-467c-85cb-1becef52834d","block_type":"box","text":"monitor its investments to ensure that the Fund remains qualified as a regulated investment company.","page_number":80,"box":{"x":69,"y":309,"width":730,"height":11}},{"id":"3c1b33e9-23b2-4111-9924-d09a378a630e","block_type":"box","text":"Liquidity Risk Management.","page_number":80,"box":{"x":102,"y":332,"width":202,"height":11}},{"id":"00bcd7b2-84e7-4403-a4c0-db0a737b4f62","block_type":"box","text":"Rule 22e-4 under the Investment Company Act (the “Liquidity Rule”) requires open","page_number":80,"box":{"x":311,"y":332,"width":591,"height":11}},{"id":"bc4e6e7a-e418-4fd0-bf98-de6e89673ca5","block_type":"box","text":"end funds, such as the Funds, to adopt a liquidity risk management program and enhance disclosures regarding fund","page_number":80,"box":{"x":69,"y":347,"width":835,"height":11}},{"id":"d9f6d035-68cf-4d0b-a74c-673f7ea8ad48","block_type":"box","text":"liquidity. As required by the Liquidity Rule, the Funds have implemented a liquidity risk management program (the","page_number":80,"box":{"x":70,"y":362,"width":803,"height":11}},{"id":"e3167e9e-4429-4d7a-a4d8-eb5db2f893ea","block_type":"box","text":"“Liquidity Program”), and the Boards of Directors of the Funds, including a majority of the independent Directors,","page_number":80,"box":{"x":70,"y":377,"width":801,"height":12}},{"id":"3ed81b53-5149-4ecd-828e-5f03af11ae09","block_type":"box","text":"have appointed the Manager as the liquidity risk program administrator of the Liquidity Program. Under the Liquidity","page_number":80,"box":{"x":69,"y":392,"width":822,"height":12}},{"id":"5898800e-600f-4eb9-80d1-2a6eddb6586d","block_type":"box","text":"Program, the Manager assesses, manages, and periodically reviews each Fund’s liquidity risk and classifies each","page_number":80,"box":{"x":69,"y":407,"width":808,"height":12}},{"id":"c7562815-dca4-480d-b57d-f18be7d87479","block_type":"box","text":"investment held by a Fund as a “highly liquid investment,” “moderately liquid investment,” “less liquid investment” or","page_number":80,"box":{"x":70,"y":423,"width":838,"height":11}},{"id":"b6e02c17-f364-4974-94fb-e3581238d332","block_type":"box","text":"“illiquid investment.” The Liquidity Rule defines “liquidity risk” as the risk that a Fund could not meet requests to","page_number":80,"box":{"x":70,"y":438,"width":804,"height":11}},{"id":"712e8b8a-d2bf-4646-96b9-1e54cf78b294","block_type":"box","text":"redeem shares issued by the Fund without significant dilution of the remaining investors’ interests in the Fund. The","page_number":80,"box":{"x":69,"y":453,"width":821,"height":11}},{"id":"f2946dae-240f-42d5-8d8d-4b36535d4e23","block_type":"box","text":"liquidity of a Fund’s por tfolio investments is determined based on relevant market, trading and investment-specific","page_number":80,"box":{"x":70,"y":468,"width":815,"height":11}},{"id":"31a70b12-1448-405e-bb2f-0343a36e2765","block_type":"box","text":"considerations under the Liquidity Program. To the extent that an investment is deemed to be an illiquid investment","page_number":80,"box":{"x":69,"y":483,"width":823,"height":11}},{"id":"4925b2a8-a522-400d-9624-447e1e3b595f","block_type":"box","text":"or a less liquid investment, a Fund can expect to be exposed to greater liquidity risk.","page_number":80,"box":{"x":69,"y":498,"width":601,"height":11}},{"id":"eb81a698-3ea7-4379-a8cb-5f7463609493","block_type":"box","text":"Master Limited Partnerships.","page_number":80,"box":{"x":102,"y":521,"width":211,"height":11}},{"id":"0657816f-2850-42c4-8690-3bd63298373f","block_type":"box","text":"Cer tain Funds may invest in publicly traded master limited par tnerships (“MLPs”)","page_number":80,"box":{"x":320,"y":521,"width":577,"height":11}},{"id":"5840b61d-b929-4ea5-ab21-14b66fcdc7d5","block_type":"box","text":"which are limited par tnerships or limited liability companies taxable as par tnerships. MLPs may derive income and","page_number":80,"box":{"x":68,"y":536,"width":816,"height":11}},{"id":"72e530fe-afca-4259-b506-15f505f9cb7e","block_type":"box","text":"gains from the exploration, development, mining or production, processing, refining, transpor tation (including","page_number":80,"box":{"x":68,"y":551,"width":777,"height":11}},{"id":"5f2094fe-2282-4127-ae68-4512c53a35cd","block_type":"box","text":"pipelines transpor ting gas, oil, or products thereof), or the marketing of any mineral or natural resources. MLPs","page_number":80,"box":{"x":70,"y":566,"width":792,"height":11}},{"id":"295b5ec7-77c5-414d-a734-3a2db334277d","block_type":"box","text":"generally have two classes of owners, the general par tner and limited par tners. When investing in an MLP, a Fund","page_number":80,"box":{"x":68,"y":581,"width":811,"height":12}},{"id":"874f69e8-2a98-44db-8222-b9783801aece","block_type":"box","text":"intends to purchase publicly traded common units issued to limited par tners of the MLP. The general par tner is","page_number":80,"box":{"x":70,"y":596,"width":791,"height":12}},{"id":"d58cf5f2-4d00-492f-8993-376cb4a3d5e2","block_type":"box","text":"typically owned by a major energy company, an investment fund, the direct management of the MLP or is an entity","page_number":80,"box":{"x":68,"y":612,"width":812,"height":11}},{"id":"0f5dc345-80dc-4571-b5e4-23909a158773","block_type":"box","text":"owned by one or more of such par ties. The general par tner may be structured as a private or publicly traded","page_number":80,"box":{"x":69,"y":627,"width":770,"height":11}},{"id":"68397b31-2fde-43fe-9d6f-d5ea3c55a2fa","block_type":"box","text":"corporation or other entity. The general par tner typically controls the operations and management of the MLP through","page_number":80,"box":{"x":69,"y":642,"width":833,"height":11}},{"id":"56e3b065-ab60-4ba0-9211-696e189c08dd","block_type":"box","text":"an up to 2% equity interest in the MLP plus, in many cases, ownership of common units and subordinated units.","page_number":80,"box":{"x":69,"y":657,"width":799,"height":11}},{"id":"413001c1-322d-4e0f-89f6-1c110815d36b","block_type":"box","text":"Limited par tners own the remainder of the par tnership, through ownership of common units, and have a limited role","page_number":80,"box":{"x":70,"y":672,"width":825,"height":11}},{"id":"a4651468-beaa-4656-8cd5-0fabe2421fe5","block_type":"box","text":"in the par tnership’s operations and management.","page_number":80,"box":{"x":70,"y":687,"width":352,"height":11}},{"id":"31444c26-9cf4-4393-9df9-e03b02791eda","block_type":"box","text":"MLPs are typically structured such that common units and general par tner interests have first priority to receive","page_number":80,"box":{"x":102,"y":710,"width":794,"height":11}},{"id":"f6e640e3-801d-4087-ae79-ce5819c05892","block_type":"box","text":"quar terly cash distributions up to an established minimum amount (“minimum quar terly distributions” or “MQD”).","page_number":80,"box":{"x":69,"y":725,"width":809,"height":11}},{"id":"859ccfd0-cd67-4ae6-9e09-fb66c9cf2409","block_type":"box","text":"Common and general par tner interests also accrue arrearages in distributions to the extent the MQD is not paid.","page_number":80,"box":{"x":69,"y":740,"width":804,"height":11}},{"id":"faf334f6-c3c4-42eb-a87b-cf2cdc0e4842","block_type":"box","text":"Once common and general par tner interests have been paid, subordinated units receive distributions of up to the","page_number":80,"box":{"x":69,"y":755,"width":808,"height":11}},{"id":"68bb77b4-f946-44d2-ac0a-42c75f51d483","block_type":"box","text":"MQD; however, subordinated units do not accrue arrearages. Distributable cash in excess of the MQD paid to both","page_number":80,"box":{"x":70,"y":770,"width":816,"height":12}},{"id":"14a633c3-5879-4056-adee-bf0a5f4eaa00","block_type":"box","text":"common and subordinated units is distributed to both common and subordinated units generally on a pro rata basis.","page_number":80,"box":{"x":69,"y":786,"width":831,"height":11}},{"id":"fc5ccf3e-8f96-4ef2-a1a3-ff18a416995b","block_type":"box","text":"The general par tner is also eligible to receive incentive distributions if the general par tner operates the business in a","page_number":80,"box":{"x":68,"y":801,"width":835,"height":11}},{"id":"96be37fb-b49e-4a6e-a202-ddda2e763a4b","block_type":"box","text":"manner which results in distributions paid per common unit surpassing specified target levels. As the general par tner","page_number":80,"box":{"x":69,"y":816,"width":838,"height":11}},{"id":"f169799a-d324-4e7f-abf3-43ac0a043eeb","block_type":"box","text":"increases cash distributions to the limited par tners, the general par tner receives an increasingly higher percentage of","page_number":80,"box":{"x":70,"y":831,"width":839,"height":11}},{"id":"9a86378e-c4a3-402c-be11-ea2d4b8d7823","block_type":"box","text":"the incremental cash distributions. A common arrangement provides that the general par tner can reach a tier where","page_number":80,"box":{"x":68,"y":846,"width":828,"height":11}},{"id":"6ab36fa0-1505-4200-8b00-46c32971fc58","block_type":"box","text":"it receives 50% of every incremental dollar paid to common and subordinated unit holders. These incentive","page_number":80,"box":{"x":70,"y":861,"width":761,"height":11}},{"id":"571a7a79-d4ba-470f-9f52-1d80ea0af872","block_type":"box","text":"distributions encourage the general par tner to streamline costs, increase capital expenditures and acquire assets in","page_number":80,"box":{"x":69,"y":876,"width":830,"height":11}},{"id":"069dcf04-5863-4a2b-b18c-541ad21a4aeb","block_type":"box","text":"order to increase the par tnership’s cash flow and raise the quar terly cash distribution in order to reach higher tiers.","page_number":80,"box":{"x":69,"y":891,"width":824,"height":12}},{"id":"d7beb8a5-144b-4211-b8b8-26885101f12a","block_type":"box","text":"Such results benefit all security holders of the MLP.","page_number":80,"box":{"x":69,"y":906,"width":366,"height":12}},{"id":"0172271c-c2a2-47a3-922a-8cd8fe4c30c1","block_type":"box","text":"II-49","page_number":80,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"9f98520a-f4ea-47a2-a386-a47ec0812607","block_type":"box","text":"NM1026U-5982568-80/232","page_number":80,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"ab3d9b01-6900-4486-8bf3-36508ff57857","block_type":"box","text":"MLP common units represent a limited par tnership interest in the MLP. Common units are listed and traded on","page_number":81,"box":{"x":102,"y":45,"width":790,"height":11}},{"id":"17d8355b-fef7-4c27-9247-e698d081d0d8","block_type":"box","text":"U.S. securities exchanges, with their value fluctuating predominantly based on prevailing market conditions and the","page_number":81,"box":{"x":70,"y":60,"width":820,"height":11}},{"id":"3503f769-a8b0-44ac-8d6c-d26905e8ee6a","block_type":"box","text":"success of the MLP. Cer tain Funds intend to purchase common units in market transactions. Unlike owners of","page_number":81,"box":{"x":69,"y":75,"width":787,"height":11}},{"id":"b3dfa374-ba91-455d-9679-0db5d141b697","block_type":"box","text":"common stock of a corporation, owners of common units have limited voting rights and have no ability to annually","page_number":81,"box":{"x":69,"y":90,"width":810,"height":11}},{"id":"56e34590-a5b1-46df-8a81-8ead335dfe33","block_type":"box","text":"elect directors. In the event of liquidation, common units have preference over subordinated units, but not over debt","page_number":81,"box":{"x":69,"y":105,"width":828,"height":11}},{"id":"0e1291dc-0017-4f42-bb26-b3f0d0497b34","block_type":"box","text":"or preferred units, to the remaining assets of the MLP.","page_number":81,"box":{"x":69,"y":120,"width":387,"height":12}},{"id":"22e1594e-0b6b-44e4-994d-942f8c3f76fd","block_type":"box","text":"Merger Transaction Risk.","page_number":81,"box":{"x":102,"y":143,"width":183,"height":11}},{"id":"0afb8acc-a509-45be-a0f7-580c08968d89","block_type":"box","text":"A Fund may buy stock of the target company in an announced merger transaction prior","page_number":81,"box":{"x":291,"y":143,"width":616,"height":11}},{"id":"cd31f859-2e6b-4936-b547-91017b47913e","block_type":"box","text":"to the consummation of such transaction. In that circumstance, a Fund would expect to receive an amount (whether","page_number":81,"box":{"x":68,"y":158,"width":827,"height":11}},{"id":"80ff8f5c-394f-44e6-b852-18636f4c7a07","block_type":"box","text":"in cash, stock of the acquiring company or a combination of both) in excess of the purchase price paid by the Fund","page_number":81,"box":{"x":70,"y":173,"width":816,"height":11}},{"id":"ed0e23c2-5368-47eb-b6d8-c46898bde3c2","block_type":"box","text":"for the target company’s stock. However, a Fund is subject to the risk that the merger transaction may be canceled,","page_number":81,"box":{"x":68,"y":188,"width":825,"height":12}},{"id":"b606e441-a029-4dc6-953b-02519989680c","block_type":"box","text":"delayed or restructured, in which case a Fund’s holding of the target company’s stock may not result in any profit for","page_number":81,"box":{"x":69,"y":203,"width":832,"height":12}},{"id":"6e5906c2-075d-4299-b060-d2d7d9287861","block_type":"box","text":"the Fund and may lose significant value.","page_number":81,"box":{"x":68,"y":218,"width":286,"height":12}},{"id":"03921289-6cee-4662-b54a-39cbfac47742","block_type":"box","text":"Money Market Obligations of Domestic Banks, Foreign Banks and Foreign Branches of U.S. Banks.","page_number":81,"box":{"x":102,"y":241,"width":723,"height":11}},{"id":"6ec39aab-075e-4fa1-a992-e8e4aeba70d3","block_type":"box","text":"Cer tain","page_number":81,"box":{"x":831,"y":241,"width":50,"height":9}},{"id":"bc424e88-dd0b-40fe-859e-3fb3dc43e43b","block_type":"box","text":"Funds may purchase bank obligations, such as cer tificates of deposit, notes, bankers’ acceptances and time","page_number":81,"box":{"x":70,"y":256,"width":778,"height":12}},{"id":"632bf22b-9467-42b2-a51e-17bcb8bb6a7e","block_type":"box","text":"deposits, including instruments issued or suppor ted by the credit of U.S. or foreign banks or savings institutions","page_number":81,"box":{"x":69,"y":271,"width":802,"height":12}},{"id":"4c93bb90-5c98-48c0-8354-8f4d4afb196f","block_type":"box","text":"having total assets at the time of purchase in excess of $1 billion. These obligations may be general obligations of","page_number":81,"box":{"x":69,"y":286,"width":820,"height":12}},{"id":"05591a55-79cd-43ec-af65-fa8cbc477a0d","block_type":"box","text":"the parent bank or may be limited to the issuing branch or subsidiary by the terms of a specific obligation or by","page_number":81,"box":{"x":68,"y":302,"width":794,"height":11}},{"id":"e82a9c63-ec9f-4c38-be4f-a1c9d5605d15","block_type":"box","text":"government regulation. The assets of a bank or savings institution will be deemed to include the assets of its","page_number":81,"box":{"x":68,"y":317,"width":781,"height":11}},{"id":"ff108dd1-2d86-4f69-9035-72b59e7543c7","block_type":"box","text":"domestic and foreign branches for purposes of a Fund’s investment policies. Investments in shor t-term bank","page_number":81,"box":{"x":69,"y":332,"width":776,"height":11}},{"id":"7fbf890e-5f73-4d29-903b-1fb02afeab75","block_type":"box","text":"obligations may include obligations of foreign banks and domestic branches of foreign banks, and also foreign","page_number":81,"box":{"x":69,"y":347,"width":785,"height":11}},{"id":"fce6039f-175c-4238-9319-af7705b21720","block_type":"box","text":"branches of domestic banks.","page_number":81,"box":{"x":69,"y":362,"width":205,"height":9}},{"id":"37385a04-993d-4f6a-8fa2-14055594daed","block_type":"box","text":"To the extent consistent with their investment objectives, a Fund may invest in debt obligations of domestic or","page_number":81,"box":{"x":101,"y":385,"width":785,"height":11}},{"id":"e6d22ec5-6f4d-4cd9-974b-a5b1f0315981","block_type":"box","text":"foreign corporations and banks, and may acquire commercial obligations issued by Canadian corporations and","page_number":81,"box":{"x":68,"y":400,"width":787,"height":11}},{"id":"61e8abcc-acca-4fe6-b73f-413aaa7358b2","block_type":"box","text":"Canadian counterpar ts of U.S. corporations, as well as Europaper, which is U.S. dollar-denominated commercial","page_number":81,"box":{"x":69,"y":415,"width":797,"height":11}},{"id":"3f691d99-39dd-43a4-80ee-237fc8fa05c9","block_type":"box","text":"paper of a foreign issuer.","page_number":81,"box":{"x":70,"y":430,"width":176,"height":11}},{"id":"ee07c967-71bb-47e6-bf45-87418447bdee","block_type":"box","text":"Money Market Securities.","page_number":81,"box":{"x":102,"y":453,"width":188,"height":11}},{"id":"4da1c7ac-5f4f-4e13-a39d-91b3ec2d4e3d","block_type":"box","text":"Cer tain Funds may invest in a broad range of shor t-term, high quality, U.S. dollar","page_number":81,"box":{"x":296,"y":453,"width":578,"height":11}},{"id":"90f77f76-2563-4d55-ac0b-36a69f9d251e","block_type":"box","text":"denominated instruments, such as government, bank, commercial and other obligations that are available in the","page_number":81,"box":{"x":69,"y":468,"width":802,"height":11}},{"id":"777244fb-47ef-473f-a360-b2ab6b905327","block_type":"box","text":"money markets. In par ticular, the Funds may invest in:","page_number":81,"box":{"x":69,"y":483,"width":386,"height":11}},{"id":"012ebdee-2e5b-4341-b305-98d39555cbf8","block_type":"box","text":"(a) U.S. dollar-denominated obligations issued or suppor ted by the credit of U.S. or foreign banks or savings","page_number":81,"box":{"x":69,"y":503,"width":779,"height":12}},{"id":"8d9a64cf-c8ec-4b78-a9db-e7dcc3b81c29","block_type":"box","text":"institutions with total assets in excess of $1 billion (including obligations of foreign branches of such banks);","page_number":81,"box":{"x":102,"y":518,"width":776,"height":12}},{"id":"cf824b97-196e-45e2-a42f-5107bccbcddb","block_type":"box","text":"(b) high quality commercial paper and other obligations issued or guaranteed by U.S. and foreign corporations and","page_number":81,"box":{"x":69,"y":538,"width":821,"height":12}},{"id":"a6104b13-050b-4dd6-9cf0-a4cbdb4d8055","block_type":"box","text":"other issuers rated (at the time of purchase) A-2 or higher by S&P, Prime-2 or higher by Moody’s or F-2 or higher","page_number":81,"box":{"x":102,"y":554,"width":795,"height":11}},{"id":"e1552b23-f769-45c7-a113-bc091f4ac05c","block_type":"box","text":"by Fitch, as well as high quality corporate bonds rated (at the time of purchase) A or higher by those rating","page_number":81,"box":{"x":102,"y":569,"width":757,"height":11}},{"id":"39e7796d-780b-4f93-bdd1-87b47b94a9c0","block_type":"box","text":"agencies;","page_number":81,"box":{"x":102,"y":584,"width":66,"height":11}},{"id":"bad3c1d1-691d-4597-b6ad-594f7e37df71","block_type":"box","text":"(c) unrated notes, paper and other instruments that are of comparable quality to the instruments described in","page_number":81,"box":{"x":69,"y":604,"width":792,"height":11}},{"id":"b32335c1-a352-47cf-877d-80d7c7b49d3c","block_type":"box","text":"(b) above as determined by the Fund’s Manager;","page_number":81,"box":{"x":102,"y":619,"width":344,"height":11}},{"id":"fe099cc4-94b1-4b0f-aec0-c1af2c076cc3","block_type":"box","text":"(d) asset-backed securities (including interests in pools of assets such as mor tgages, installment purchase","page_number":81,"box":{"x":69,"y":639,"width":776,"height":12}},{"id":"aa4243f5-3c22-4a1a-b3cb-dc265aa155dd","block_type":"box","text":"obligations and credit card receivables);","page_number":81,"box":{"x":102,"y":655,"width":283,"height":11}},{"id":"e32a9347-8a16-4fb6-a6a9-764bf489f701","block_type":"box","text":"(e) securities issued or guaranteed as to principal and interest by the U.S. Government or by its agencies or","page_number":81,"box":{"x":69,"y":675,"width":778,"height":11}},{"id":"8d0b4c1a-1bf0-458c-8971-0e9e27259211","block_type":"box","text":"authorities and related custodial receipts;","page_number":81,"box":{"x":102,"y":690,"width":296,"height":11}},{"id":"c67c7c9d-1731-4270-8f96-c95fc1055be4","block_type":"box","text":"(f) dollar-denominated securities issued or guaranteed by foreign governments or their political subdivisions,","page_number":81,"box":{"x":69,"y":710,"width":782,"height":11}},{"id":"5788b8b5-9fb8-4d6a-87ed-1b6284734353","block_type":"box","text":"agencies or authorities;","page_number":81,"box":{"x":102,"y":725,"width":166,"height":11}},{"id":"3da025a1-50ac-4b24-8516-5eed6d380bf1","block_type":"box","text":"(g) funding agreements issued by highly-rated U.S. insurance companies;","page_number":81,"box":{"x":69,"y":745,"width":528,"height":11}},{"id":"eda13c23-60d8-4e57-bcac-2c1487bc5479","block_type":"box","text":"(h) securities issued or guaranteed by state or local governmental bodies;","page_number":81,"box":{"x":69,"y":766,"width":534,"height":11}},{"id":"1b89b3da-e130-400d-8d1f-a46d6bb0476e","block_type":"box","text":"(i) repurchase agreements relating to the above instruments;","page_number":81,"box":{"x":69,"y":786,"width":447,"height":11}},{"id":"73e63dee-7bf6-48bb-9ffc-c3fa0bd2f87f","block_type":"box","text":"(j) municipal bonds and notes whose principal and interest payments are guaranteed by the U.S. Government or","page_number":81,"box":{"x":69,"y":806,"width":812,"height":11}},{"id":"3f6e8c82-0777-40dc-bb0e-4816faa60c33","block_type":"box","text":"one of its agencies or authorities or which otherwise depend directly or indirectly on the credit of the United","page_number":81,"box":{"x":102,"y":821,"width":766,"height":11}},{"id":"38a4ade8-56d5-4845-9ede-c51da243d861","block_type":"box","text":"States;","page_number":81,"box":{"x":102,"y":836,"width":49,"height":10}},{"id":"22c1bad4-3edb-423c-8c88-251918d4d27f","block_type":"box","text":"(k) fixed and variable rate notes and similar debt instruments rated MIG-2, VMIG-2 or Prime-2 or higher by Moody’s,","page_number":81,"box":{"x":69,"y":856,"width":829,"height":11}},{"id":"bfae77d1-d8a7-4624-b018-040c252f56b7","block_type":"box","text":"SP-2 or A-2 or higher by S&P, or F-2 or higher by Fitch;","page_number":81,"box":{"x":102,"y":871,"width":379,"height":11}},{"id":"f8ff68d5-0213-4aec-8ed7-41782939c398","block_type":"box","text":"(l) tax-exempt commercial paper and similar debt instruments rated Prime-2 or higher by Moody’s, A-2 or higher by","page_number":81,"box":{"x":69,"y":891,"width":826,"height":12}},{"id":"e9329eb7-c043-4673-9902-15fda0f40102","block_type":"box","text":"S&P, or F-2 or higher by Fitch;","page_number":81,"box":{"x":102,"y":906,"width":207,"height":12}},{"id":"b9308c9f-60e7-4405-ba5a-a82245c7f91f","block_type":"box","text":"II-50","page_number":81,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"6430b059-7a8d-4ef8-8dd4-c02983c183cd","block_type":"box","text":"NM1026U-5982568-81/232","page_number":81,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"c052c75a-9edd-4b51-bddd-84d5dd2dd03a","block_type":"box","text":"(m) municipal bonds rated A or higher by Moody’s, S&P or Fitch;","page_number":82,"box":{"x":69,"y":45,"width":458,"height":11}},{"id":"e411d930-2d9e-48d4-9a1b-b2e385ce9d20","block_type":"box","text":"(n) unrated notes, paper or other instruments that are of comparable quality to the instruments described above, as","page_number":82,"box":{"x":69,"y":65,"width":837,"height":11}},{"id":"f4a7e33f-929e-4bb6-b376-6b82c7c235e8","block_type":"box","text":"determined by the Fund’s Manager under guidelines established by the Board; and","page_number":82,"box":{"x":101,"y":80,"width":589,"height":11}},{"id":"d9166a39-541c-4003-8f69-7b7e50fe54e0","block_type":"box","text":"(o) municipal bonds and notes which are guaranteed as to principal and interest by the U.S. Government or an","page_number":82,"box":{"x":69,"y":100,"width":795,"height":11}},{"id":"b6229419-342a-4184-a2fc-b8b1eebe287b","block_type":"box","text":"agency or instrumentality thereof or which otherwise depend directly or indirectly on the credit of the United","page_number":82,"box":{"x":102,"y":115,"width":764,"height":11}},{"id":"12b2100b-d73c-4e6b-b7f9-71194d144ff0","block_type":"box","text":"States.","page_number":82,"box":{"x":102,"y":130,"width":49,"height":9}},{"id":"da59353b-74be-4763-87db-bf39979f2673","block_type":"box","text":"Mortgage-Related Securities.","page_number":82,"box":{"x":102,"y":153,"width":213,"height":11}},{"id":"a4e51625-cce8-40a8-92e6-dea105ce0757","block_type":"box","text":"Mor tgage-Backed Securities.","page_number":82,"box":{"x":102,"y":176,"width":203,"height":11}},{"id":"d9d1b71c-e131-45ab-bb1d-afe0242dff8f","block_type":"box","text":"Mor tgage-backed securities represent interests in pools of mor tgages in which","page_number":82,"box":{"x":312,"y":176,"width":560,"height":11}},{"id":"99382002-5930-4a4d-98fd-921ae030c4bb","block_type":"box","text":"payments of both principal and interest on the securities are generally made monthly, in effect “passing through”","page_number":82,"box":{"x":70,"y":191,"width":805,"height":11}},{"id":"1d4562b5-b76d-4f2a-b97d-6b11b5b499bf","block_type":"box","text":"monthly payments made by borrowers on the residential or commercial mor tgage loans that underlie the securities","page_number":82,"box":{"x":69,"y":206,"width":819,"height":11}},{"id":"48a1afd9-b833-4d4d-b471-23ec3cf8dd58","block_type":"box","text":"(net of any fees paid to the issuer or guarantor of the securities). Mor tgage-backed securities differ from other forms","page_number":82,"box":{"x":69,"y":221,"width":832,"height":11}},{"id":"d0a5b205-9ea7-4875-8b07-8694d21def66","block_type":"box","text":"of debt securities, which normally provide for periodic payment of interest in fixed amounts with principal payments at","page_number":82,"box":{"x":69,"y":236,"width":838,"height":11}},{"id":"ea36ef56-820f-495f-99d8-696967e4b48d","block_type":"box","text":"maturity or specified call dates.","page_number":82,"box":{"x":69,"y":251,"width":222,"height":11}},{"id":"789c200d-7826-4930-bb0c-1a4024d4104e","block_type":"box","text":"Mor tgage-backed securities are subject to the general risks associated with investing in real estate securities;","page_number":82,"box":{"x":102,"y":274,"width":785,"height":11}},{"id":"29e10e01-1403-4cbc-8623-933b2dc0672f","block_type":"box","text":"that is, they may lose value if the value of the underlying real estate to which a pool of mor tgages relates declines. In","page_number":82,"box":{"x":68,"y":289,"width":838,"height":11}},{"id":"b53b6905-66a1-4795-9a4b-c431eda5b017","block_type":"box","text":"addition, investments in mor tgage-backed securities involve cer tain specific risks. These risks include the failure of a","page_number":82,"box":{"x":69,"y":304,"width":836,"height":11}},{"id":"ba9ebf3e-0697-40f6-a098-ab4f64d74064","block_type":"box","text":"par ty to meet its commitments under the related operative documents, adverse interest rate changes and the effects","page_number":82,"box":{"x":70,"y":319,"width":837,"height":12}},{"id":"fa02a23e-7e48-4fff-b88f-26dacc58e7e7","block_type":"box","text":"of prepayments on mor tgage cash flows. Mor tgage-backed securities are “pass-through” securities, meaning that","page_number":82,"box":{"x":69,"y":334,"width":810,"height":12}},{"id":"0011c404-4d3d-4e33-82e9-431d007bec85","block_type":"box","text":"principal and interest payments made by the borrower on the underlying mor tgages are passed through to a Fund.","page_number":82,"box":{"x":70,"y":350,"width":811,"height":11}},{"id":"af41443c-2af8-490f-9633-b441c8408ee2","block_type":"box","text":"Accordingly, the value of mor tgage-backed securities in which a Fund invests may be par ticularly sensitive to changes","page_number":82,"box":{"x":68,"y":365,"width":837,"height":11}},{"id":"ba2f76e1-a7fa-4747-a373-795d2a01b4bc","block_type":"box","text":"in prevailing interest rates, and, like other fixed income investments, the ability of a Fund to utilize these instruments","page_number":82,"box":{"x":70,"y":380,"width":834,"height":11}},{"id":"18344dc3-25c7-4a42-bd78-c8c41da27627","block_type":"box","text":"successfully may depend in par t upon the ability of the Manager to forecast interest rates and other economic factors","page_number":82,"box":{"x":69,"y":395,"width":840,"height":11}},{"id":"ea9b4fb4-5941-4c01-925f-a0ea143aa21a","block_type":"box","text":"correctly. The value of mor tgage-backed securities, like that of traditional fixed-income securities, typically increases","page_number":82,"box":{"x":69,"y":410,"width":827,"height":11}},{"id":"0b79ec3c-167e-4927-8228-9a73ff5fc119","block_type":"box","text":"when interest rates fall and decreases when interest rates rise. However, mor tgage-backed securities differ from","page_number":82,"box":{"x":68,"y":425,"width":805,"height":11}},{"id":"200da835-e541-41b0-99bf-bbb6541e59a3","block_type":"box","text":"traditional fixed-income securities because of their potential for prepayment without penalty. The price paid by a Fund","page_number":82,"box":{"x":68,"y":440,"width":834,"height":11}},{"id":"4b848f62-466e-45e3-80e7-820273ad21f8","block_type":"box","text":"for its mor tgage-backed securities, the yield the Fund expects to receive from such securities and the weighted","page_number":82,"box":{"x":68,"y":455,"width":791,"height":12}},{"id":"9ed07592-0338-4ef7-a36e-00421b8d2fab","block_type":"box","text":"average life of the securities are based on a number of factors, including the anticipated rate of prepayment of the","page_number":82,"box":{"x":69,"y":470,"width":816,"height":12}},{"id":"25e1bbbc-c674-4143-803c-cb8570a9e7cf","block_type":"box","text":"underlying mor tgages. In a period of declining interest rates, borrowers may prepay the underlying mor tgages more","page_number":82,"box":{"x":69,"y":486,"width":819,"height":11}},{"id":"63553d42-cbdb-42bd-933e-ecc4d2fe7278","block_type":"box","text":"quickly than anticipated, thereby reducing the yield to maturity and the average life of the mor tgage-backed","page_number":82,"box":{"x":69,"y":501,"width":761,"height":11}},{"id":"fa1b67fe-5be2-48c2-9e28-11aab62571dd","block_type":"box","text":"securities. Moreover, when a Fund reinvests the proceeds of a prepayment in these circumstances, it will likely","page_number":82,"box":{"x":69,"y":516,"width":791,"height":11}},{"id":"47897738-1f98-422a-997b-199d4d5e9e9d","block_type":"box","text":"receive a rate of interest that is lower than the rate on the security that was prepaid.","page_number":82,"box":{"x":69,"y":531,"width":602,"height":11}},{"id":"015e5458-ed6d-4dc8-91e8-5f38d184b93c","block_type":"box","text":"To the extent that a Fund purchases mor tgage-backed securities at a premium, mor tgage foreclosures and","page_number":82,"box":{"x":101,"y":554,"width":761,"height":11}},{"id":"776a6f02-bdea-4269-aa8f-40a791b83d2e","block_type":"box","text":"principal prepayments may result in a loss to the extent of the premium paid. If a Fund buys such securities at a","page_number":82,"box":{"x":70,"y":569,"width":800,"height":11}},{"id":"8c1cf4a6-1bba-4710-82d6-d8383f669623","block_type":"box","text":"discount, both scheduled payments of principal and unscheduled prepayments will increase current and total returns","page_number":82,"box":{"x":69,"y":584,"width":833,"height":11}},{"id":"f5d4375c-45b5-4b3e-9c74-ca871d36908f","block_type":"box","text":"and will accelerate the recognition of income, which, when distributed to shareholders, will be taxable as ordinary","page_number":82,"box":{"x":69,"y":599,"width":809,"height":11}},{"id":"4ceae9c7-bb5d-4bea-b337-3fc55eb2f5e1","block_type":"box","text":"income. In a period of rising interest rates, prepayments of the underlying mor tgages may occur at a slower than","page_number":82,"box":{"x":70,"y":614,"width":801,"height":11}},{"id":"b29ddd54-ad51-430c-83e0-6d9523218a40","block_type":"box","text":"expected rate, creating maturity extension risk. This par ticular risk may effectively change a security that was","page_number":82,"box":{"x":69,"y":629,"width":778,"height":11}},{"id":"3bf2250b-b1cc-4eab-923d-c3935b539873","block_type":"box","text":"considered shor t- or intermediate-term at the time of purchase into a long-term security. Since the value of long-term","page_number":82,"box":{"x":69,"y":644,"width":831,"height":12}},{"id":"9b638396-f7e7-4081-bc00-995ffe76be27","block_type":"box","text":"securities generally fluctuates more widely in response to changes in interest rates than that of shor ter-term","page_number":82,"box":{"x":69,"y":659,"width":773,"height":12}},{"id":"9fab2e02-82a8-4f75-9e97-7ee2d307add7","block_type":"box","text":"securities, maturity extension risk could increase the inherent volatility of the Fund. Under cer tain interest rate and","page_number":82,"box":{"x":69,"y":675,"width":818,"height":11}},{"id":"b60d5df6-487a-4040-9341-be835355d538","block_type":"box","text":"prepayment scenarios, a Fund may fail to recoup fully its investment in mor tgage-backed securities notwithstanding","page_number":82,"box":{"x":70,"y":690,"width":822,"height":11}},{"id":"426884c6-b4b6-43e8-9953-5da12186fd3c","block_type":"box","text":"any direct or indirect governmental or agency guarantee.","page_number":82,"box":{"x":69,"y":705,"width":399,"height":11}},{"id":"398bfdf9-bce6-4db5-88f7-c55b93dedbb8","block_type":"box","text":"There are currently three types of mor tgage pass-through securities: (1) those issued by the U.S. Government or","page_number":82,"box":{"x":101,"y":727,"width":802,"height":12}},{"id":"82eaea98-df26-42f4-b1a3-0e795b84eaa4","block_type":"box","text":"one of its agencies or instrumentalities, such as the Government National Mor tgage Association (“Ginnie Mae”), the","page_number":82,"box":{"x":69,"y":743,"width":830,"height":11}},{"id":"f298be68-5423-45b0-a9d9-66c98920328d","block_type":"box","text":"Federal National Mor tgage Association (“Fannie Mae”) and the Federal Home Loan Mor tgage Corporation (“Freddie","page_number":82,"box":{"x":70,"y":758,"width":818,"height":11}},{"id":"26e721ec-2507-4d32-8ebb-34ddd56e4cfa","block_type":"box","text":"Mac”); (2) those issued by private issuers that represent an interest in or are collateralized by pass-through","page_number":82,"box":{"x":70,"y":773,"width":766,"height":11}},{"id":"909d2b0b-5ca7-4421-9b7b-142e51b4d25b","block_type":"box","text":"securities issued or guaranteed by the U.S. Government or one of its agencies or instrumentalities; and (3) those","page_number":82,"box":{"x":69,"y":788,"width":808,"height":11}},{"id":"98fda8cd-eddb-4ca8-ae7e-8c120f91a7b9","block_type":"box","text":"issued by private issuers that represent an interest in or are collateralized by whole mor tgage loans or pass-through","page_number":82,"box":{"x":70,"y":803,"width":825,"height":11}},{"id":"39a4862b-d5c8-414e-b807-67c811eaeb18","block_type":"box","text":"securities without a government guarantee but that usually have some form of private credit enhancement.","page_number":82,"box":{"x":69,"y":818,"width":761,"height":11}},{"id":"78e6238c-ebbe-4275-be2f-c5d7154fe83c","block_type":"box","text":"Ginnie Mae is a wholly owned U.S. Government corporation within the Depar tment of Housing and Urban","page_number":82,"box":{"x":102,"y":841,"width":743,"height":11}},{"id":"66f02585-feb7-45f4-b5aa-b9a748869d9e","block_type":"box","text":"Development. Ginnie Mae is authorized to guarantee, with the full faith and credit of the U.S. Government, the timely","page_number":82,"box":{"x":70,"y":856,"width":831,"height":11}},{"id":"7f213e90-4465-42be-8883-68d2b11e3e45","block_type":"box","text":"payment of principal and interest on securities issued by the institutions approved by Ginnie Mae (such as savings","page_number":82,"box":{"x":70,"y":871,"width":815,"height":11}},{"id":"6325a206-d40c-48e2-a5a1-8201c576f6f1","block_type":"box","text":"and loan institutions, commercial banks and mor tgage banks), and backed by pools of Federal Housing","page_number":82,"box":{"x":69,"y":886,"width":737,"height":12}},{"id":"861fa8bf-0130-4192-876f-100e1e3e6273","block_type":"box","text":"Administration (“FHA”)-insured or Veterans’ Administration (“VA”)-guaranteed mor tgages. Pass-through cer tificates","page_number":82,"box":{"x":68,"y":901,"width":814,"height":12}},{"id":"fe8b9c19-c4f4-49d2-979a-63d5283fe120","block_type":"box","text":"II-51","page_number":82,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"48b4360a-cf2c-40d6-bfe0-3d3ce70275be","block_type":"box","text":"NM1026U-5982568-82/232","page_number":82,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"cafcb3ab-233e-453f-8d5e-34cf536b63cf","block_type":"box","text":"guaranteed by Ginnie Mae (such cer tificates are also known as “Ginnie Maes”) are guaranteed as to the timely","page_number":83,"box":{"x":68,"y":45,"width":794,"height":11}},{"id":"56fe2865-f9ec-4ece-b946-7a6e6e48fdf3","block_type":"box","text":"payment of principal and interest by Ginnie Mae, whose guarantee is backed by the full faith and credit of the United","page_number":83,"box":{"x":70,"y":60,"width":828,"height":11}},{"id":"c45711e0-acfd-45a2-a70d-782f608e084d","block_type":"box","text":"States. Ginnie Mae cer tificates also are suppor ted by the authority of Ginnie Mae to borrow funds from the U.S.","page_number":83,"box":{"x":69,"y":75,"width":798,"height":11}},{"id":"5a53d39c-7289-4980-9f93-48edb14c6764","block_type":"box","text":"Treasury Depar tment to make payments under its guarantee. Mor tgage-related securities issued by Fannie Mae","page_number":83,"box":{"x":68,"y":90,"width":798,"height":11}},{"id":"76f4f424-b6ca-43d8-9549-c0e7d1f31862","block_type":"box","text":"include Fannie Mae guaranteed Mor tgage Pass-Through Cer tificates (also known as “Fannie Maes”), which are","page_number":83,"box":{"x":70,"y":105,"width":788,"height":11}},{"id":"abc417e5-ed5b-4fd8-8ac2-2fab7341e273","block_type":"box","text":"guaranteed as to timely payment of principal and interest by Fannie Mae. They are not backed by or entitled to the full","page_number":83,"box":{"x":68,"y":120,"width":840,"height":12}},{"id":"483bd2e4-3c60-4d08-b788-3fdf0eb035bd","block_type":"box","text":"faith and credit of the United States, but are suppor ted by the right of Fannie Mae to borrow from the U.S. Treasury","page_number":83,"box":{"x":68,"y":135,"width":825,"height":12}},{"id":"d3534b1e-955d-4494-8be7-b72663ee16b3","block_type":"box","text":"Depar tment. Fannie Mae was established as a federal agency in 1938 and in 1968 was char tered by Congress as a","page_number":83,"box":{"x":70,"y":150,"width":830,"height":12}},{"id":"e4033c7f-8ffb-4692-ac41-089aa4fae1fe","block_type":"box","text":"private shareholder-owned company. Mor tgage-related securities issued by Freddie Mac include Freddie Mac","page_number":83,"box":{"x":70,"y":166,"width":770,"height":11}},{"id":"9829e47d-af92-45f8-b811-feae69467910","block_type":"box","text":"Mor tgage Par ticipation Cer tificates (also known as “Freddie Macs” or “PCs”). Freddie Mac is a stockholder-owned","page_number":83,"box":{"x":70,"y":181,"width":812,"height":11}},{"id":"4a25d389-8b32-4223-a5c9-8b5f78e8aae9","block_type":"box","text":"corporation char tered by Congress in 1970. Freddie Macs are not guaranteed by the United States or by any Federal","page_number":83,"box":{"x":69,"y":196,"width":829,"height":11}},{"id":"6f0d8793-f6ce-4217-8610-786b0bed4fb6","block_type":"box","text":"Home Loan Banks and do not constitute a debt or obligation of the United States or of any Federal Home Loan Bank.","page_number":83,"box":{"x":70,"y":211,"width":832,"height":11}},{"id":"6bfe396f-66bb-49d4-bffa-9beb41ef7ca9","block_type":"box","text":"Freddie Macs entitle the holder to timely payment of interest, which is guaranteed by Freddie Mac. Freddie Mac","page_number":83,"box":{"x":70,"y":226,"width":792,"height":11}},{"id":"f435068c-c2b7-4e41-a054-42087fba9587","block_type":"box","text":"guarantees either ultimate collection or timely payment of all principal payments on the underlying mor tgage loans.","page_number":83,"box":{"x":68,"y":241,"width":819,"height":11}},{"id":"f0a1d013-81b9-4bc7-bb36-ec25b9a274f8","block_type":"box","text":"While Freddie Mac generally does not guarantee timely payment of principal, Freddie Mac may remit the amount due","page_number":83,"box":{"x":68,"y":256,"width":829,"height":12}},{"id":"df841381-d289-4062-a316-7b4828f81314","block_type":"box","text":"on account of its guarantee of ultimate payment of principal at any time after default on an underlying mor tgage, but","page_number":83,"box":{"x":69,"y":271,"width":829,"height":12}},{"id":"ac5e3823-7324-43ea-a6b7-820acf1d7e7b","block_type":"box","text":"in no event later than one year after it becomes payable.","page_number":83,"box":{"x":70,"y":286,"width":401,"height":12}},{"id":"a55a1785-857c-4397-a131-691575d34b7d","block_type":"box","text":"Private mor tgage pass-through securities are structured similarly to Ginnie Mae, Fannie Mae, and Freddie Mac","page_number":83,"box":{"x":102,"y":309,"width":786,"height":11}},{"id":"9b899bd7-9676-47b2-a27a-a6354d282084","block_type":"box","text":"mor tgage pass-through securities and are issued by originators of and investors in mor tgage loans, including","page_number":83,"box":{"x":69,"y":324,"width":777,"height":12}},{"id":"b11e83df-ea49-43a9-b54d-45d5b31fc3e9","block_type":"box","text":"depository institutions, mor tgage banks, investment banks and special purpose subsidiaries of the foregoing.","page_number":83,"box":{"x":69,"y":339,"width":782,"height":12}},{"id":"5dc25266-c84e-4d96-aada-f503b3e89360","block_type":"box","text":"Pools created by private mor tgage pass-through issuers generally offer a higher rate of interest than government","page_number":83,"box":{"x":102,"y":362,"width":802,"height":11}},{"id":"7f7b4bee-c05b-4400-8a81-36f4fa0bbd7b","block_type":"box","text":"and government-related pools because there are no direct or indirect government or agency guarantees of payments","page_number":83,"box":{"x":69,"y":377,"width":828,"height":12}},{"id":"6bef74a8-642c-4254-891b-dbc37b47c78e","block_type":"box","text":"in the private pools. However, timely payment of interest and principal of these pools may be suppor ted by various","page_number":83,"box":{"x":70,"y":392,"width":814,"height":12}},{"id":"7645f24e-147e-43c3-a92c-e5de6eb099b9","block_type":"box","text":"forms of insurance or guarantees, including individual loan, title, pool and hazard insurance and letters of credit. The","page_number":83,"box":{"x":68,"y":407,"width":833,"height":12}},{"id":"4bad6a67-ff1e-4f99-ade2-4449e8e50768","block_type":"box","text":"insurance and guarantees are issued by governmental entities, private insurers and the mor tgage poolers. The","page_number":83,"box":{"x":70,"y":423,"width":789,"height":11}},{"id":"ad69edad-5765-4ae4-aa2b-38612764780b","block_type":"box","text":"insurance and guarantees and the creditwor thiness of the issuers thereof will be considered in determining whether","page_number":83,"box":{"x":70,"y":438,"width":827,"height":11}},{"id":"06d0c0e8-45b9-458b-a527-0d92042fb959","block_type":"box","text":"a mor tgage-related security meets a Fund’s investment quality standards. There can be no assurance that the private","page_number":83,"box":{"x":69,"y":453,"width":838,"height":11}},{"id":"2510a378-66ff-49e2-b021-394ca6d6c887","block_type":"box","text":"insurers or guarantors can meet their obligations under the insurance policies or guarantee arrangements. Private","page_number":83,"box":{"x":70,"y":468,"width":810,"height":11}},{"id":"6efa3c0b-6e7a-49fc-8910-f8ed50824939","block_type":"box","text":"mor tgage pass-through securities may be bought without insurance or guarantees if, through an examination of the","page_number":83,"box":{"x":69,"y":483,"width":820,"height":11}},{"id":"9bd03cb4-ff53-46a5-ab32-3275b649e390","block_type":"box","text":"loan experience and practices of the originator/servicers and poolers, the Manager determines that the securities","page_number":83,"box":{"x":70,"y":498,"width":812,"height":11}},{"id":"7b834e37-ad1e-47ff-a9bd-bab5b3b8d7fb","block_type":"box","text":"meet a Fund’s quality standards. Any mor tgage-related securities that are issued by private issuers have some","page_number":83,"box":{"x":69,"y":514,"width":790,"height":11}},{"id":"b510a675-7da1-4e7e-ad67-2fa9bde17710","block_type":"box","text":"exposure to subprime loans as well as to the mor tgage and credit markets generally.","page_number":83,"box":{"x":69,"y":529,"width":604,"height":11}},{"id":"1253cc7b-0153-4119-8974-c401c20fb246","block_type":"box","text":"In addition, mor tgage-related securities that are issued by private issuers are not subject to the underwriting","page_number":83,"box":{"x":102,"y":551,"width":774,"height":11}},{"id":"74f9ddfa-c95b-4cfc-85b6-e92383e0c9e0","block_type":"box","text":"requirements for the underlying mor tgages that are applicable to those mor tgage-related securities that have a","page_number":83,"box":{"x":69,"y":566,"width":791,"height":11}},{"id":"b7162b44-d50e-49e4-a332-135f85cb4657","block_type":"box","text":"government or government-sponsored entity guarantee. As a result, the mor tgage loans underlying private mor tgage","page_number":83,"box":{"x":68,"y":582,"width":832,"height":11}},{"id":"7800ba36-832f-493c-8153-185023a64d90","block_type":"box","text":"related securities may, and frequently do, have less favorable collateral, credit risk or other underwriting","page_number":83,"box":{"x":69,"y":596,"width":742,"height":12}},{"id":"b2fd1407-9390-4f5c-9008-73d3fac09e35","block_type":"box","text":"characteristics than government or government-sponsored mor tgage-related securities and have wider variances in a","page_number":83,"box":{"x":69,"y":612,"width":831,"height":11}},{"id":"bcbec4ed-48ff-4767-9350-fe7c5040a334","block_type":"box","text":"number of terms including interest rate, term, size, purpose and borrower characteristics. Privately issued pools more","page_number":83,"box":{"x":69,"y":627,"width":840,"height":11}},{"id":"cd00534d-f95d-4d4e-943b-56dcab3a74e1","block_type":"box","text":"frequently include second mor tgages, high loan-to-value mor tgages and manufactured housing loans. The coupon","page_number":83,"box":{"x":68,"y":642,"width":809,"height":11}},{"id":"5468a36d-e796-4ca0-b77f-81039aa19fc5","block_type":"box","text":"rates and maturities of the underlying mor tgage loans in a private-label mor tgage-related securities pool may vary to","page_number":83,"box":{"x":69,"y":657,"width":828,"height":11}},{"id":"0ebd41af-42bd-42f9-9a46-5da2eb93f8e2","block_type":"box","text":"a greater extent than those included in a government guaranteed pool, and the pool may include subprime mor tgage","page_number":83,"box":{"x":69,"y":672,"width":830,"height":11}},{"id":"726b6dc4-e421-4869-abe6-c201ec85c8a9","block_type":"box","text":"loans. Subprime loans refer to loans made to borrowers with weakened credit histories or with a lower capacity to","page_number":83,"box":{"x":70,"y":687,"width":810,"height":11}},{"id":"0a890e86-d084-4b82-83e6-1cf00583bc62","block_type":"box","text":"make timely payments on their loans. For these reasons, the loans underlying these securities have had in many","page_number":83,"box":{"x":69,"y":703,"width":804,"height":11}},{"id":"c1717e6b-eeb3-4d64-839c-ed846e918803","block_type":"box","text":"cases higher default rates than those loans that meet government underwriting requirements.","page_number":83,"box":{"x":69,"y":717,"width":669,"height":12}},{"id":"34a21875-f214-4327-857c-87e558bff87e","block_type":"box","text":"The risk of non-payment is greater for mor tgage-related securities that are backed by mor tgage pools that","page_number":83,"box":{"x":101,"y":740,"width":754,"height":11}},{"id":"4833776f-1d81-4347-8e08-8f90781dd2f4","block_type":"box","text":"contain subprime loans, but a level of risk exists for all loans. Market factors adversely affecting mor tgage loan","page_number":83,"box":{"x":69,"y":755,"width":795,"height":11}},{"id":"2324befd-e59d-49da-bf6b-5088ddace7ee","block_type":"box","text":"repayments may include a general economic turndown, high unemployment, a general slowdown in the real estate","page_number":83,"box":{"x":69,"y":771,"width":812,"height":11}},{"id":"eb0a3dab-25d8-43d5-ab28-bedcebec802a","block_type":"box","text":"market, a drop in the market prices of real estate, or an increase in interest rates resulting in higher mor tgage","page_number":83,"box":{"x":69,"y":785,"width":788,"height":12}},{"id":"3e7a4cf4-f098-411a-8b5d-5f3ebec97a4f","block_type":"box","text":"payments by holders of adjustable rate mor tgages.","page_number":83,"box":{"x":70,"y":801,"width":361,"height":11}},{"id":"1ea86819-ba4b-4ac7-9164-14eb4e54d375","block_type":"box","text":"Privately issued mor tgage-related securities are not traded on an exchange and there may be a limited market","page_number":83,"box":{"x":102,"y":823,"width":784,"height":12}},{"id":"6fb8ed17-e0c2-4a37-b616-d70118d014f2","block_type":"box","text":"for the securities, especially when there is a perceived weakness in the mor tgage and real estate market sectors.","page_number":83,"box":{"x":68,"y":838,"width":813,"height":12}},{"id":"0e5f42d6-ad21-4bcc-85d9-a191c7a4db77","block_type":"box","text":"Without an active trading market, mor tgage-related securities held in a Fund’s por tfolio may be par ticularly difficult to","page_number":83,"box":{"x":68,"y":853,"width":837,"height":12}},{"id":"74aa0e50-4beb-4111-bfe0-fe18de4415fb","block_type":"box","text":"value because of the complexities involved in assessing the value of the underlying mor tgage loans.","page_number":83,"box":{"x":68,"y":869,"width":714,"height":11}},{"id":"eff3a5ac-becd-49a8-9a77-c322672b6703","block_type":"box","text":"Collateralized Mor tgage Obligations (“CMOs”).","page_number":83,"box":{"x":102,"y":891,"width":328,"height":12}},{"id":"070e62ca-ae93-46ed-8685-6d00ed2b8e10","block_type":"box","text":"CMOs are debt obligations collateralized by residential or","page_number":83,"box":{"x":437,"y":891,"width":407,"height":12}},{"id":"27e9090e-4f9d-4063-b280-b24327394456","block_type":"box","text":"commercial mor tgage loans or residential or commercial mor tgage pass-through securities. Interest and prepaid","page_number":83,"box":{"x":69,"y":907,"width":800,"height":11}},{"id":"e6acfb90-3665-4ab4-a57f-6a99d5f9de0c","block_type":"box","text":"II-52","page_number":83,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"15fb90f0-0b11-472a-b60f-3252d96ced56","block_type":"box","text":"NM1026U-5982568-83/232","page_number":83,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"c2a3eb1a-9b4c-4a8c-b15b-46042814a9d5","block_type":"box","text":"principal are generally paid monthly. CMOs may be collateralized by whole mor tgage loans or private mor tgage pass","page_number":84,"box":{"x":70,"y":45,"width":827,"height":11}},{"id":"f183194c-10e4-4e89-ad2e-ef9cc4461570","block_type":"box","text":"through securities but are more typically collateralized by por tfolios of mor tgage pass-through securities guaranteed","page_number":84,"box":{"x":68,"y":60,"width":826,"height":11}},{"id":"986de16f-df18-403f-83aa-98b50b479816","block_type":"box","text":"by Ginnie Mae, Freddie Mac, or Fannie Mae. The issuer of a series of CMOs may elect to be treated as a Real Estate","page_number":84,"box":{"x":69,"y":75,"width":833,"height":11}},{"id":"ba5efac0-40c3-4253-8f9d-92b23d299f1e","block_type":"box","text":"Mor tgage Investment Conduit (“REMIC”). All future references to CMOs also include REMICs.","page_number":84,"box":{"x":70,"y":90,"width":661,"height":11}},{"id":"f832b6a6-0667-41db-86aa-7b01678a75d6","block_type":"box","text":"CMOs are structured into multiple classes, often referred to as a “tranche,” each issued at a specific adjustable","page_number":84,"box":{"x":102,"y":113,"width":803,"height":11}},{"id":"bd71db54-a43c-4562-9a0b-cb22c7725667","block_type":"box","text":"or fixed interest rate, and bearing a different stated maturity date and each must be fully retired no later than its final","page_number":84,"box":{"x":69,"y":128,"width":837,"height":11}},{"id":"c35babf7-2483-43db-af16-df500ae42cd2","block_type":"box","text":"distribution date. Actual maturity and average life will depend upon the prepayment experience of the collateral, which","page_number":84,"box":{"x":69,"y":143,"width":838,"height":11}},{"id":"21aec7ce-a360-4192-8c0f-eec0c5fdb9ec","block_type":"box","text":"is ordinarily unrelated to the stated maturity date. CMOs often provide for a modified form of call protection through a","page_number":84,"box":{"x":70,"y":158,"width":836,"height":11}},{"id":"2742b69d-cfb3-48fa-894a-6e3a1c0ba6c3","block_type":"box","text":"de facto breakdown of the underlying pool of mor tgages according to how quickly the loans are repaid. Monthly","page_number":84,"box":{"x":69,"y":173,"width":791,"height":11}},{"id":"ebc89bd5-693c-4359-950c-6177cd80f627","block_type":"box","text":"payment of principal received from the pool of underlying mor tgages, including prepayments, is first returned to","page_number":84,"box":{"x":70,"y":188,"width":792,"height":12}},{"id":"489388c2-f779-41b7-b7b7-c254d872ac2c","block_type":"box","text":"investors holding the shor test maturity class. Investors holding the longer maturity classes usually receive principal","page_number":84,"box":{"x":70,"y":204,"width":820,"height":11}},{"id":"82088f1f-359b-48a4-aeb3-c5587c56fc00","block_type":"box","text":"only after the first class has been retired. An investor may be par tially protected against a sooner than desired return","page_number":84,"box":{"x":69,"y":218,"width":836,"height":12}},{"id":"9d431e67-8d8e-443b-a2d8-9a6db31b105f","block_type":"box","text":"of principal because of the sequential payments.","page_number":84,"box":{"x":69,"y":234,"width":346,"height":11}},{"id":"2bfdc1ff-daf8-45b5-add7-49f84f4944f7","block_type":"box","text":"Cer tain issuers of CMOs are not considered investment companies pursuant to a rule adopted by the","page_number":84,"box":{"x":102,"y":256,"width":723,"height":11}},{"id":"f398e917-2d9b-4e04-8067-2409240a5e2f","block_type":"box","text":"Commission, and a Fund may invest in the securities of such issuers without the limitations imposed by the","page_number":84,"box":{"x":69,"y":271,"width":768,"height":12}},{"id":"158fccc5-4d97-4bf8-95d0-87c030213ac3","block_type":"box","text":"Investment Company Act on investments by a Fund in other investment companies. In addition, in reliance on an","page_number":84,"box":{"x":70,"y":287,"width":800,"height":11}},{"id":"44d51318-3b2b-4c5e-ab1e-c99fd3d7aa84","block_type":"box","text":"earlier Commission interpretation, a Fund’s investments in cer tain other qualifying CMOs, which cannot or do not rely","page_number":84,"box":{"x":69,"y":302,"width":836,"height":11}},{"id":"bdfb11fd-47dd-4f16-98da-1cf01600622c","block_type":"box","text":"on the rule, are also not subject to the limitation of the Investment Company Act on acquiring interests in other","page_number":84,"box":{"x":69,"y":317,"width":793,"height":11}},{"id":"8e3b8fe3-dd81-4e26-82dd-c440f5498453","block_type":"box","text":"investment companies. In order to be able to rely on the Commission’s interpretation, these CMOs must be","page_number":84,"box":{"x":70,"y":332,"width":767,"height":11}},{"id":"08f88e99-5c9f-4a81-a156-eceb6d70faaa","block_type":"box","text":"unmanaged, fixed asset issuers, that: (1) invest primarily in mor tgage-backed securities; (2) do not issue redeemable","page_number":84,"box":{"x":69,"y":347,"width":838,"height":11}},{"id":"20529193-2229-4f9a-aa62-281eda592711","block_type":"box","text":"securities; (3) operate under general exemptive orders exempting them from all provisions of the Investment","page_number":84,"box":{"x":69,"y":362,"width":773,"height":11}},{"id":"15b86458-1bbe-4782-92de-bebeb90c3943","block_type":"box","text":"Company Act; and (4) are not registered or regulated under the Investment Company Act as investment companies.","page_number":84,"box":{"x":69,"y":377,"width":821,"height":12}},{"id":"61a86963-bb48-4e65-96c5-441157b90bd5","block_type":"box","text":"To the extent that a Fund selects CMOs that cannot rely on the rule or do not meet the above requirements, the Fund","page_number":84,"box":{"x":68,"y":392,"width":836,"height":12}},{"id":"dcd78d63-07ca-43c1-b230-e5d81e4810f5","block_type":"box","text":"may not invest more than 10% of its assets in all such entities and may not acquire more than 3% of the voting","page_number":84,"box":{"x":69,"y":407,"width":795,"height":12}},{"id":"bc3badce-c103-4e42-b71c-381e22dd5e61","block_type":"box","text":"securities of any single such entity.","page_number":84,"box":{"x":69,"y":423,"width":248,"height":11}},{"id":"f50b2380-c166-4bbd-99a3-d531c126f6ab","block_type":"box","text":"A Fund may also invest in, among other things, parallel pay CMOs, sequential pay CMOs, and floating rate CMOs.","page_number":84,"box":{"x":101,"y":445,"width":807,"height":12}},{"id":"06bfa82e-6730-4e65-83f9-c4bb5bb6dac6","block_type":"box","text":"Parallel pay CMOs are structured to provide payments of principal on each payment date to more than one class,","page_number":84,"box":{"x":69,"y":460,"width":805,"height":12}},{"id":"7e00f2f8-dc75-4c32-a161-c67ce85e9cf8","block_type":"box","text":"concurrently on a propor tionate or dispropor tionate basis. These simultaneous payments are taken into account in","page_number":84,"box":{"x":69,"y":476,"width":819,"height":11}},{"id":"c7672e13-8ab5-4b81-b49b-d44297f9753a","block_type":"box","text":"calculating the final distribution date of each class. Sequential pay CMOs generally pay principal to only one class at","page_number":84,"box":{"x":69,"y":491,"width":829,"height":11}},{"id":"d992b749-6d9e-481f-9fd2-c774686dce56","block_type":"box","text":"a time while paying interest to several classes. A wide variety of REMIC Cer tificates may be issued in the parallel pay","page_number":84,"box":{"x":69,"y":506,"width":835,"height":11}},{"id":"cc586e1a-1af0-4038-b7d3-b98c08fc25a7","block_type":"box","text":"or sequential pay structures. These securities include accrual cer tificates (also known as “Z-Bonds”), which only","page_number":84,"box":{"x":69,"y":521,"width":802,"height":11}},{"id":"2d561927-f06a-4819-924b-2990b1bfffc2","block_type":"box","text":"accrue interest at a specified rate until all other cer tificates having an earlier final distribution date have been retired","page_number":84,"box":{"x":69,"y":536,"width":833,"height":11}},{"id":"ecbcac31-303b-4947-a996-1b64b7bfb861","block_type":"box","text":"and are conver ted thereafter to an interest-paying security. Floating rate CMOs are securities whose coupon rate","page_number":84,"box":{"x":69,"y":551,"width":801,"height":11}},{"id":"f9e522aa-2b26-4811-8a7e-0009fe93cf9a","block_type":"box","text":"fluctuates according to some formula related to an existing market index or rate. Typical indices would include the","page_number":84,"box":{"x":68,"y":566,"width":813,"height":11}},{"id":"3bd4f95c-ff11-44f8-9660-2b646cf4ae33","block_type":"box","text":"eleventh district cost-of-funds index (“COFI”), one-year Treasury yields, and ten-year Treasury yields.","page_number":84,"box":{"x":69,"y":581,"width":708,"height":11}},{"id":"77a5ca47-5d2c-4929-9473-bcbd9ecebe12","block_type":"box","text":"Classes of CMOs also include planned amor tization classes (“PACs”) and targeted amor tization classes","page_number":84,"box":{"x":102,"y":604,"width":742,"height":11}},{"id":"82b210a2-97a4-4c69-8304-99bd8f80cd1a","block_type":"box","text":"(“TACs”). PAC bonds generally require payments of a specified amount of principal on each payment date. The","page_number":84,"box":{"x":69,"y":619,"width":784,"height":11}},{"id":"92bc0939-5748-4531-9681-7b36e00ad908","block_type":"box","text":"scheduled principal payments for PAC Cer tificates generally have the highest priority on each payment date after","page_number":84,"box":{"x":69,"y":634,"width":800,"height":12}},{"id":"9e463994-d671-4daa-b74c-f111668fde8e","block_type":"box","text":"interest due has been paid to all classes entitled to receive interest currently. Shor tfalls, if any, are added to the","page_number":84,"box":{"x":70,"y":649,"width":802,"height":12}},{"id":"2c9f9f37-22d8-4273-a98d-e98f80ec212c","block_type":"box","text":"amount payable on the next payment date. The PAC Cer tificate payment schedule is taken into account in calculating","page_number":84,"box":{"x":69,"y":664,"width":834,"height":12}},{"id":"3d6bba90-84ef-4f16-9a05-60756b3dfb29","block_type":"box","text":"the final distribution date of each class of PAC. In order to create PAC tranches, one or more tranches generally must","page_number":84,"box":{"x":68,"y":680,"width":835,"height":11}},{"id":"7e119b47-b114-469a-bdd6-11c76f2b5acf","block_type":"box","text":"be created that absorb most of the volatility in the underlying mor tgage assets. These tranches (often called","page_number":84,"box":{"x":69,"y":695,"width":772,"height":11}},{"id":"33335fde-128e-4f68-a7a3-d3624e79c52d","block_type":"box","text":"“suppor ts” or “companion” tranches) tend to have market prices and yields that are more volatile than the PAC","page_number":84,"box":{"x":70,"y":710,"width":792,"height":11}},{"id":"3e5c25a9-3e1a-4aac-8ad8-218325dd6dc2","block_type":"box","text":"classes.","page_number":84,"box":{"x":69,"y":725,"width":57,"height":9}},{"id":"19bf56ba-6bcd-41f4-928a-e8b5beebe598","block_type":"box","text":"TACs are similar to PACs in that they require that specified amounts of principal be applied on each payment","page_number":84,"box":{"x":101,"y":748,"width":774,"height":11}},{"id":"199047e9-8c8e-47fd-95d0-36a9cd7bda73","block_type":"box","text":"date to one or more classes of REMIC Cer tificates. A PAC’s payment schedule, however, remains in effect as long as","page_number":84,"box":{"x":69,"y":763,"width":835,"height":11}},{"id":"c2399a4c-c873-4daf-a7d9-c06a6b85434f","block_type":"box","text":"prepayment rates on the underlying mor tgages do not exceed cer tain ranges. In contrast, a TAC provides investors","page_number":84,"box":{"x":70,"y":778,"width":815,"height":11}},{"id":"36d73ff3-aa8e-401f-b39f-5a0e7a46eb46","block_type":"box","text":"with protection, to a cer tain level, against either faster than expected or slower than expected prepayment rates, but","page_number":84,"box":{"x":68,"y":793,"width":833,"height":11}},{"id":"fdc250b4-c161-41cd-8b20-3204c78a3efc","block_type":"box","text":"not both. TACs thus provide more cash flow stability than a regular sequential paying class, but less than a PAC. TACs","page_number":84,"box":{"x":69,"y":808,"width":839,"height":11}},{"id":"d2896257-99c2-4804-9965-9421f51c9c95","block_type":"box","text":"also tend to have market prices and yields that are more volatile than PACs.","page_number":84,"box":{"x":69,"y":823,"width":541,"height":11}},{"id":"e399e1a9-4b1a-4506-b823-a0b6e06b713d","block_type":"box","text":"Adjustable Rate Mor tgage Securities.","page_number":84,"box":{"x":101,"y":846,"width":265,"height":11}},{"id":"071b626b-cbeb-4c32-8d89-d544ee49f612","block_type":"box","text":"Adjustable rate mor tgage securities (“ARMs”) are pass-through securities","page_number":84,"box":{"x":372,"y":846,"width":523,"height":11}},{"id":"1b04e92e-8a0b-4a20-93a8-e0c6058b29c7","block_type":"box","text":"collateralized by mor tgages with adjustable rather than fixed rates. ARMs eligible for inclusion in a mor tgage pool","page_number":84,"box":{"x":69,"y":861,"width":807,"height":11}},{"id":"a812243d-2291-4362-b7ec-23c294f7fd68","block_type":"box","text":"generally provide for a fixed initial mor tgage interest rate for a set number of scheduled monthly payments. After that","page_number":84,"box":{"x":68,"y":876,"width":835,"height":11}},{"id":"8f0ef43f-a31e-4fa9-9f9f-63b8ef075b35","block_type":"box","text":"schedule of payments has been completed, the interest rates are subject to periodic adjustment based on changes","page_number":84,"box":{"x":69,"y":891,"width":824,"height":12}},{"id":"f2ab450e-6684-4104-8e88-fab3a38cdc0b","block_type":"box","text":"to a designated benchmark index.","page_number":84,"box":{"x":68,"y":907,"width":241,"height":11}},{"id":"b42b6893-5457-4102-9ece-9432f9451230","block_type":"box","text":"II-53","page_number":84,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"83687293-3490-482a-8f15-4e474ebea213","block_type":"box","text":"NM1026U-5982568-84/232","page_number":84,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"d3650c9f-03b7-4d00-a16f-dcba6f55e7c5","block_type":"box","text":"ARMs contain maximum and minimum rates beyond which the mor tgage interest rate may not vary over the","page_number":85,"box":{"x":101,"y":45,"width":767,"height":11}},{"id":"9280e1b1-1c86-48f4-9d41-c32773e0e32c","block_type":"box","text":"lifetime of the security. In addition, cer tain ARMs provide for additional limitations on the maximum amount by which","page_number":85,"box":{"x":70,"y":60,"width":828,"height":11}},{"id":"f067ce94-323f-4450-a557-57369c5f87fa","block_type":"box","text":"the mor tgage interest rate may adjust for any single adjustment period. In the event that market rates of interest rise","page_number":85,"box":{"x":68,"y":75,"width":837,"height":11}},{"id":"1066048e-6d82-48c3-8345-40b861b28f86","block_type":"box","text":"more rapidly to levels above that of the ARM’s maximum rate, the ARM’s coupon may represent a below market rate","page_number":85,"box":{"x":69,"y":90,"width":830,"height":11}},{"id":"9b6912b9-73f4-4b65-87c6-bb801051bc84","block_type":"box","text":"of interest. In these circumstances, the market value of the ARM security will likely have fallen.","page_number":85,"box":{"x":69,"y":105,"width":676,"height":11}},{"id":"360a32b6-5205-4b03-9a58-dc0a354715b5","block_type":"box","text":"Cer tain ARMs contain limitations on changes in the required monthly payment. In the event that a monthly","page_number":85,"box":{"x":102,"y":128,"width":757,"height":11}},{"id":"c7c2261c-db75-4920-8d0f-3440991affca","block_type":"box","text":"payment is not sufficient to pay the interest accruing on an ARM, any such excess interest is added to the principal","page_number":85,"box":{"x":70,"y":143,"width":822,"height":11}},{"id":"abca6f25-d8ed-4827-82da-564cad0bad24","block_type":"box","text":"balance of the mor tgage loan, which is repaid through future monthly payments. If the monthly payment for such an","page_number":85,"box":{"x":69,"y":158,"width":823,"height":11}},{"id":"cb4b9517-a044-4109-af38-e86095aa65da","block_type":"box","text":"instrument exceeds the sum of the interest accrued at the applicable mor tgage interest rate and the principal","page_number":85,"box":{"x":70,"y":173,"width":782,"height":11}},{"id":"857f7d36-6ea0-4313-8033-ed0ea433f2f0","block_type":"box","text":"payment required at such point to amor tize the outstanding principal balance over the remaining term of the loan, the","page_number":85,"box":{"x":70,"y":188,"width":838,"height":12}},{"id":"a8d38288-ad9c-4ad6-a3c3-6162a8b1f0c1","block_type":"box","text":"excess is then used to reduce the outstanding principal balance of the ARM.","page_number":85,"box":{"x":69,"y":203,"width":544,"height":12}},{"id":"f500e43c-c4b2-4f15-8e0b-4df186e7004c","block_type":"box","text":"CMO Residuals.","page_number":85,"box":{"x":102,"y":226,"width":112,"height":9}},{"id":"aed9ae2d-9b0c-4e12-91a2-f866fecd99f6","block_type":"box","text":"CMO residuals are derivative mor tgage securities issued by agencies or instrumentalities of the","page_number":85,"box":{"x":221,"y":226,"width":682,"height":11}},{"id":"6c916353-f7ad-4c37-bdd4-002e77728524","block_type":"box","text":"U.S. Government or by private originators of, or investors in, mor tgage loans, including savings and loan","page_number":85,"box":{"x":70,"y":241,"width":740,"height":11}},{"id":"4f48043d-322b-4218-9a5e-61c588b2e9ce","block_type":"box","text":"associations, homebuilders, mor tgage banks, commercial banks, investment banks, and special purpose entities of","page_number":85,"box":{"x":69,"y":256,"width":829,"height":12}},{"id":"bc5f0fef-ff41-4128-aa20-2e7f97e49a56","block_type":"box","text":"the foregoing. The cash flow generated by the mor tgage assets underlying a series of CMOs is applied first to make","page_number":85,"box":{"x":68,"y":271,"width":826,"height":12}},{"id":"0605a393-beae-49d4-a50a-73c7d9906ab7","block_type":"box","text":"required payments of principal and interest on the CMOs and second to pay the related administrative expenses and","page_number":85,"box":{"x":69,"y":286,"width":831,"height":12}},{"id":"50ec86cd-55fd-437a-9ec4-973a73e5fa1b","block_type":"box","text":"any management fees of the issuer. The residual in a CMO structure generally represents the interest in any excess","page_number":85,"box":{"x":69,"y":302,"width":827,"height":11}},{"id":"97188658-a705-4dc5-83ad-ee67c17ecd7a","block_type":"box","text":"cash flow remaining after making the foregoing payments. Each payment of such excess cash flow to a holder of the","page_number":85,"box":{"x":69,"y":317,"width":829,"height":11}},{"id":"6454bb46-da26-4d12-a8c9-0b1b782c4118","block_type":"box","text":"related CMO residual represents income and/or a return of capital. The amount of residual cash flow resulting from a","page_number":85,"box":{"x":69,"y":332,"width":838,"height":11}},{"id":"4c09dabe-2839-4633-9300-569c1f2c6e66","block_type":"box","text":"CMO will depend on, among other things, the characteristics of the mor tgage assets, the coupon rate of each class","page_number":85,"box":{"x":69,"y":347,"width":825,"height":11}},{"id":"23a93143-8433-4ea1-91a2-05aca5bb9732","block_type":"box","text":"of CMO, prevailing interest rates, the amount of administrative expenses and the prepayment experience on the","page_number":85,"box":{"x":69,"y":362,"width":798,"height":11}},{"id":"2c150de8-fd82-4e17-8ae5-6feb7c5ff51a","block_type":"box","text":"mor tgage assets. In par t, the yield to maturity on the CMO residuals is extremely sensitive to prepayments on the","page_number":85,"box":{"x":69,"y":377,"width":813,"height":12}},{"id":"6e258f9d-da51-4e62-aa56-454ee4ad622f","block_type":"box","text":"related underlying mor tgage assets, in the same manner as an interest-only class of stripped mor tgage-related","page_number":85,"box":{"x":69,"y":392,"width":790,"height":12}},{"id":"690ab2dc-1225-4f3f-b7b2-b1554b95b06e","block_type":"box","text":"securities. In addition, if a series of a CMO includes a class that bears interest at an adjustable rate, the yield to","page_number":85,"box":{"x":69,"y":407,"width":805,"height":12}},{"id":"7bfb912d-8147-4d7d-8068-9efc054a4600","block_type":"box","text":"maturity on the related CMO residual will also be extremely sensitive to changes in the level of the index upon which","page_number":85,"box":{"x":69,"y":423,"width":828,"height":11}},{"id":"45dd0063-2688-4705-978d-baa46a2e7e71","block_type":"box","text":"interest rate adjustments are based. In cer tain circumstances, a Fund may fail to recoup fully its initial investment in","page_number":85,"box":{"x":70,"y":438,"width":831,"height":11}},{"id":"5e839fcc-fbf8-4f39-88da-878c445f7492","block_type":"box","text":"a CMO residual.","page_number":85,"box":{"x":69,"y":453,"width":112,"height":9}},{"id":"cf54af21-f63e-4b24-b821-1ecb4e801626","block_type":"box","text":"CMO residuals are generally purchased and sold by institutional investors through one or more investment","page_number":85,"box":{"x":102,"y":476,"width":758,"height":11}},{"id":"67c43082-a799-4823-85d0-0ac7f0e855d8","block_type":"box","text":"banking firms acting as brokers or dealers. Transactions in CMO residuals are generally completed only after careful","page_number":85,"box":{"x":69,"y":491,"width":827,"height":11}},{"id":"5cb7e8ae-e859-4205-b7c0-cddbfd98332b","block_type":"box","text":"review of the characteristics of the securities in question. In addition, CMO residuals may or, pursuant to an","page_number":85,"box":{"x":69,"y":506,"width":769,"height":11}},{"id":"f320a6a4-1fe5-4dff-8f4a-e6a501c95812","block_type":"box","text":"exemption therefrom, may not have been registered under the Securities Act. Residual interests generally are junior","page_number":85,"box":{"x":69,"y":521,"width":825,"height":11}},{"id":"186f71a4-19e7-41cf-9759-59b409b464e2","block_type":"box","text":"to, and may be significantly more volatile than, “regular” CMO and REMIC interests. CMO residuals, whether or not","page_number":85,"box":{"x":68,"y":536,"width":820,"height":11}},{"id":"494d20ac-1b01-4045-ae91-b857fe2f8e18","block_type":"box","text":"registered under the Securities Act, may be subject to cer tain restrictions on transferability.","page_number":85,"box":{"x":69,"y":551,"width":650,"height":11}},{"id":"5712cd9a-4e3d-4065-b376-73a93d33728d","block_type":"box","text":"Stripped Mor tgage-Backed Securities.","page_number":85,"box":{"x":102,"y":574,"width":267,"height":11}},{"id":"6227bccd-8941-4f0a-9bc4-6ff7cdd7d079","block_type":"box","text":"A Fund may invest in stripped mor tgage-backed securities (“SMBSs”)","page_number":85,"box":{"x":375,"y":574,"width":493,"height":11}},{"id":"b8904fc5-977c-49c1-ae2f-e1b160e2c8d7","block_type":"box","text":"issued by agencies or instrumentalities of the United States. SMBSs are derivative multi-class mor tgage-backed","page_number":85,"box":{"x":70,"y":589,"width":798,"height":11}},{"id":"379d247d-c18a-4235-983c-887fd04b1e6f","block_type":"box","text":"securities. SMBS arrangements commonly involve two classes of securities that receive different propor tions of the","page_number":85,"box":{"x":69,"y":604,"width":826,"height":11}},{"id":"fca3e155-feb5-492f-b895-f6cd44f07083","block_type":"box","text":"interest and principal distributions on a pool of mor tgage assets. A common variety of SMBS is where one class (the","page_number":85,"box":{"x":70,"y":619,"width":832,"height":11}},{"id":"79f2406b-8396-46a7-a5be-3d1567c25e58","block_type":"box","text":"principal only or PO class) receives some of the interest and most of the principal from the underlying assets, while","page_number":85,"box":{"x":70,"y":634,"width":821,"height":12}},{"id":"c331c393-0ee4-491f-a71e-51e5ea82fa9f","block_type":"box","text":"the other class (the interest only or IO class) receives most of the interest and the remainder of the principal. In the","page_number":85,"box":{"x":68,"y":649,"width":826,"height":12}},{"id":"2fb447db-86f1-40a5-b771-01c030a449ea","block_type":"box","text":"most extreme case, the IO class receives all of the interest, while the PO class receives all of the principal. While a","page_number":85,"box":{"x":69,"y":664,"width":822,"height":11}},{"id":"f03bae6e-a810-4542-8613-050a4291390f","block_type":"box","text":"Fund may purchase securities of a PO class, a Fund is more likely to purchase the securities of an IO class. The yield","page_number":85,"box":{"x":70,"y":680,"width":834,"height":11}},{"id":"a102a854-7024-4898-a649-0530b75cf0dc","block_type":"box","text":"to maturity of an IO class is extremely sensitive to the rate of principal payments (including prepayments) on the","page_number":85,"box":{"x":68,"y":695,"width":800,"height":11}},{"id":"52a9ba10-2cf9-4af9-b9a3-3628ccfec855","block_type":"box","text":"related underlying assets, and a rapid rate of principal prepayments in excess of that considered in pricing the","page_number":85,"box":{"x":69,"y":710,"width":786,"height":11}},{"id":"527ba725-ec12-4fa6-a7b1-a1abad38a03a","block_type":"box","text":"securities will have a material adverse effect on an IO security’s yield to maturity. If the underlying mor tgage assets","page_number":85,"box":{"x":69,"y":725,"width":823,"height":11}},{"id":"b6a58dd5-3d30-42a8-a206-360751499a93","block_type":"box","text":"experience greater than anticipated payments of principal, a Fund may fail to recoup fully its initial investment in IOs.","page_number":85,"box":{"x":69,"y":740,"width":832,"height":11}},{"id":"005b9c28-1c11-4b64-a55c-40251d17200e","block_type":"box","text":"In addition, there are cer tain types of IOs that represent the interest por tion of a par ticular class as opposed to the","page_number":85,"box":{"x":70,"y":755,"width":824,"height":11}},{"id":"1c8befc3-2994-44c9-881e-58a28db71532","block_type":"box","text":"interest por tion of the entire pool. The sensitivity of this type of IO to interest rate fluctuations may be increased","page_number":85,"box":{"x":70,"y":770,"width":800,"height":11}},{"id":"6e0b13c6-cb56-413e-9f2e-2121edc1f7cc","block_type":"box","text":"because of the characteristics of the principal por tion to which they relate. As a result of the above factors, a Fund","page_number":85,"box":{"x":69,"y":785,"width":818,"height":12}},{"id":"eca83336-f582-4839-820d-60a108f270ea","block_type":"box","text":"generally will purchase IOs only as a component of so called “synthetic” securities. This means that purchases of IOs","page_number":85,"box":{"x":68,"y":801,"width":840,"height":11}},{"id":"03240062-b7c6-48d7-9180-88d9f4521337","block_type":"box","text":"will be matched with cer tain purchases of other securities, such as POs, inverse floating rate CMOs or fixed rate","page_number":85,"box":{"x":68,"y":816,"width":802,"height":11}},{"id":"342f7ae5-e653-4b7c-bae4-34f80a2a590a","block_type":"box","text":"securities; as interest rates fall, presenting a greater risk of unanticipated prepayments of principal, the negative","page_number":85,"box":{"x":69,"y":831,"width":805,"height":11}},{"id":"bc0b50d5-1b97-4b33-abb3-1fe0daa36ebe","block_type":"box","text":"effect on a Fund because of its holdings of IOs should be diminished somewhat because of the increased yield on","page_number":85,"box":{"x":69,"y":846,"width":814,"height":11}},{"id":"e5747bd2-d765-42d1-aada-a79473401e10","block_type":"box","text":"the inverse floating rate CMOs or the increased appreciation on the POs or fixed rate securities.","page_number":85,"box":{"x":68,"y":861,"width":683,"height":11}},{"id":"1af84ffe-38cc-40f9-bf01-4dc91b4a2529","block_type":"box","text":"Tiered Index Bonds.","page_number":85,"box":{"x":103,"y":884,"width":138,"height":9}},{"id":"765a5ed6-25f2-46e5-a1e1-2a703d75dbb1","block_type":"box","text":"Tiered index bonds are forms of mor tgage-related securities. The interest rate on a tiered","page_number":85,"box":{"x":247,"y":884,"width":638,"height":11}},{"id":"da6dfbc7-52e1-4398-ac35-1d6cc192a5f3","block_type":"box","text":"index bond is tied to a specified index or market rate. So long as this index or market rate is below a predetermined","page_number":85,"box":{"x":70,"y":899,"width":825,"height":11}},{"id":"e8dff667-84fc-43e1-b9c1-1b698023f300","block_type":"box","text":"II-54","page_number":85,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"927835b3-5645-47c1-a237-02e565c75549","block_type":"box","text":"NM1026U-5982568-85/232","page_number":85,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"d507b376-0e69-4fb2-8777-69204863961e","block_type":"box","text":"“strike” rate, the interest rate on the tiered index bond remains fixed. If, however, the specified index or market rate","page_number":86,"box":{"x":70,"y":45,"width":827,"height":11}},{"id":"275a4980-e73a-4daf-a9fe-3f5d52c5e829","block_type":"box","text":"rises above the “strike” rate, the interest rate of the tiered index bond will decrease. Thus, under these","page_number":86,"box":{"x":69,"y":60,"width":738,"height":10}},{"id":"eb48f181-f821-4537-9d36-bf40e6951848","block_type":"box","text":"circumstances, the interest rate on a tiered index bond, like an inverse floater, will move in the opposite direction of","page_number":86,"box":{"x":69,"y":75,"width":828,"height":11}},{"id":"358bacb8-b5c9-4564-893d-4a8344533bef","block_type":"box","text":"prevailing interest rates, with the result that the price of the tiered index bond may be considerably more volatile than","page_number":86,"box":{"x":70,"y":90,"width":836,"height":11}},{"id":"c70025d6-c078-48be-9345-91c23089edec","block_type":"box","text":"that of a fixed-rate bond.","page_number":86,"box":{"x":68,"y":105,"width":174,"height":9}},{"id":"92600067-4b22-40c2-a9bc-75b4eb109c7f","block_type":"box","text":"TBA Commitments.","page_number":86,"box":{"x":103,"y":128,"width":133,"height":9}},{"id":"8349388f-af67-48f4-898d-4a6cc2be16b7","block_type":"box","text":"Cer tain Funds may enter into “to be announced” or “TBA” commitments. TBA commitments","page_number":86,"box":{"x":243,"y":128,"width":653,"height":11}},{"id":"32be16ef-c4ac-4da1-833d-bf25efbc8d95","block_type":"box","text":"are forward agreements for the purchase or sale of securities, including mor tgage-backed securities for a fixed price,","page_number":86,"box":{"x":69,"y":143,"width":834,"height":11}},{"id":"b132fccb-806f-4ce2-852e-c5dcaa08069c","block_type":"box","text":"with payment and delivery on an agreed upon future settlement date. The specific securities to be delivered are not","page_number":86,"box":{"x":68,"y":158,"width":825,"height":11}},{"id":"02bd57f6-5514-432f-9d27-ec4c8116463c","block_type":"box","text":"identified at the trade date. However, delivered securities must meet specified terms, including issuer, rate and","page_number":86,"box":{"x":70,"y":173,"width":793,"height":11}},{"id":"67eb5508-509a-4a17-894d-995633330c1f","block_type":"box","text":"mor tgage terms. When the Fund enters into a TBA commitment for the sale of mor tgage-backed securities for a fixed","page_number":86,"box":{"x":69,"y":188,"width":833,"height":12}},{"id":"e9b1f5a0-68de-424c-a987-70a049914407","block_type":"box","text":"price, with payment and delivery on an agreed upon future settlement date (which may be referred to as having a","page_number":86,"box":{"x":70,"y":203,"width":804,"height":12}},{"id":"93a6bd49-1657-41c7-9a8b-10d1adda62fe","block_type":"box","text":"shor t position in such TBA securities), the Fund may or may not hold the types of mor tgage-backed securities","page_number":86,"box":{"x":69,"y":218,"width":779,"height":12}},{"id":"b4855603-e7d1-4c79-82bc-bd62df1015c5","block_type":"box","text":"required to be delivered. See “—When-Issued Securities, Delayed Delivery Securities and Forward Commitments”","page_number":86,"box":{"x":69,"y":234,"width":810,"height":11}},{"id":"8b0e79ef-5161-42a4-8c0f-5e6cda71562f","block_type":"box","text":"below.","page_number":86,"box":{"x":69,"y":249,"width":43,"height":9}},{"id":"ea0d273c-2c1d-40b6-9f17-3c964625b0e0","block_type":"box","text":"Mor tgage Dollar Rolls.","page_number":86,"box":{"x":102,"y":272,"width":157,"height":11}},{"id":"fcff4329-d57f-46cb-a3cb-a8cf3cafa5e4","block_type":"box","text":"Cer tain Funds may invest in mor tgage dollar rolls. In a mor tgage dollar roll transaction, a","page_number":86,"box":{"x":266,"y":272,"width":634,"height":11}},{"id":"eb4963d6-673d-49a2-a759-a5d6ea44374c","block_type":"box","text":"Fund sells mor tgage-backed securities for delivery in the current month and simultaneously contracts to repurchase","page_number":86,"box":{"x":70,"y":286,"width":825,"height":12}},{"id":"cd452bb4-7f2e-4d92-9bcd-a5b77dd0fd1e","block_type":"box","text":"substantially similar securities on a specified future date. The securities that are repurchased will bear the same","page_number":86,"box":{"x":69,"y":302,"width":805,"height":11}},{"id":"06a0a0a4-127b-4e55-8eba-d27a58634d88","block_type":"box","text":"interest rate and a similar maturity as those sold, but pools of mor tgages collateralizing those securities may have","page_number":86,"box":{"x":70,"y":317,"width":817,"height":11}},{"id":"51bc938d-65d6-463d-89de-52aa20ff6516","block_type":"box","text":"different prepayment histories than those sold. During the period between the sale and repurchase, a Fund will not","page_number":86,"box":{"x":69,"y":332,"width":820,"height":11}},{"id":"a793c2e3-abb7-4c9f-a36e-ad5a3767b016","block_type":"box","text":"be entitled to receive interest and principal payments on the securities sold. Proceeds of the sale will be invested in","page_number":86,"box":{"x":69,"y":347,"width":827,"height":11}},{"id":"f937df5b-ee41-44da-b1b8-099014e9c167","block_type":"box","text":"additional instruments for the Fund, and the income from these investments will generate income for the Fund. If","page_number":86,"box":{"x":69,"y":362,"width":806,"height":11}},{"id":"62e23067-9158-4844-aa53-af179acb4f4b","block_type":"box","text":"such income does not exceed the income, capital appreciation and gain or loss that would have been realized on the","page_number":86,"box":{"x":69,"y":377,"width":833,"height":12}},{"id":"55308f2e-2d71-4aca-9e19-5e0575671135","block_type":"box","text":"securities sold as par t of the dollar roll, the use of this technique will diminish the investment per formance of a Fund","page_number":86,"box":{"x":69,"y":392,"width":836,"height":11}},{"id":"cd74afd8-afbf-48ff-98c2-6f93558c7eee","block_type":"box","text":"compared with what the per formance would have been without the use of dollar rolls.","page_number":86,"box":{"x":69,"y":407,"width":607,"height":11}},{"id":"9851f566-0100-4865-8269-d2e23b3c4942","block_type":"box","text":"Each mor tgage dollar roll transaction is accounted for as a sale or purchase of a por tfolio security and a","page_number":86,"box":{"x":102,"y":430,"width":744,"height":11}},{"id":"c672b7bd-d5b4-416f-936e-3ca2c2c73635","block_type":"box","text":"subsequent purchase or sale of a substantially similar security in the forward market. Transactions in mor tgage","page_number":86,"box":{"x":69,"y":445,"width":796,"height":12}},{"id":"b65db656-c814-46be-b465-46ab4e2976f5","block_type":"box","text":"dollar rolls may increase trading costs and por tfolio turnover.","page_number":86,"box":{"x":69,"y":460,"width":433,"height":12}},{"id":"09953bda-1973-4eaa-9011-1876acfbaf85","block_type":"box","text":"In the event the buyer of the securities under a mor tgage dollar roll files for bankruptcy or becomes insolvent, a","page_number":86,"box":{"x":102,"y":483,"width":795,"height":11}},{"id":"82829c7c-2433-47e6-8181-a9cc9d64cf9b","block_type":"box","text":"Fund’s use of the proceeds of the current sale por tion of the transaction may be restricted pending a determination","page_number":86,"box":{"x":70,"y":498,"width":824,"height":11}},{"id":"5c0938d8-5afe-4bfc-b53a-48f1115784c1","block_type":"box","text":"by the other par ty, or its trustee or receiver, whether to enforce the Fund’s obligation to purchase the similar","page_number":86,"box":{"x":69,"y":513,"width":774,"height":12}},{"id":"7d450983-3420-4a75-af95-47d399d1c42c","block_type":"box","text":"securities in the forward transaction.","page_number":86,"box":{"x":69,"y":528,"width":261,"height":9}},{"id":"42aecced-46f1-4abc-9f12-6a0a221451f1","block_type":"box","text":"A Fund may engage in dollar roll transactions to enhance returns. Successful use of mor tgage dollar rolls may","page_number":86,"box":{"x":101,"y":551,"width":785,"height":11}},{"id":"2f232b8b-83d9-4da7-9820-c0180452d7fe","block_type":"box","text":"depend upon the Manager’s ability to correctly predict interest rates and prepayments. Dollar rolls involve the risk","page_number":86,"box":{"x":69,"y":566,"width":812,"height":11}},{"id":"eac5ad44-252c-4cd5-8115-d91135e22bec","block_type":"box","text":"that the market value of the securities subject to a Fund’s forward purchase commitment may decline below, or the","page_number":86,"box":{"x":68,"y":581,"width":824,"height":11}},{"id":"ce559324-aafe-4b40-b8e5-99e1016ff1e9","block_type":"box","text":"market value of the securities subject to a Fund’s forward sale commitment may increase above, the exercise price","page_number":86,"box":{"x":69,"y":596,"width":824,"height":12}},{"id":"7647e284-03d6-449a-a61d-8a213bbbf8a2","block_type":"box","text":"of the forward commitment. Dollar rolls are speculative techniques that can be deemed to involve leverage. There is","page_number":86,"box":{"x":69,"y":612,"width":828,"height":11}},{"id":"9b6ed75a-50d3-476c-892a-ea1aa2f95d87","block_type":"box","text":"no assurance that dollar rolls can be successfully employed.","page_number":86,"box":{"x":69,"y":627,"width":430,"height":11}},{"id":"c0949f34-b13c-4692-bb9c-aecfe3c7e69d","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into when-issued or forward-settling","page_number":86,"box":{"x":102,"y":649,"width":759,"height":12}},{"id":"1fac09e3-ad80-4bfe-b785-c638a00211d9","block_type":"box","text":"securities (","page_number":86,"box":{"x":69,"y":665,"width":78,"height":11}},{"id":"08ef5bcc-582c-4a36-9a78-e3de96c6e807","block_type":"box","text":"e.g.","page_number":86,"box":{"x":148,"y":666,"width":25,"height":10}},{"id":"fb65ea11-52cc-46a0-8062-6a1f5c3a9708","block_type":"box","text":", dollar rolls and firm and standby commitments, including TBA commitments) and non-standard","page_number":86,"box":{"x":176,"y":664,"width":681,"height":12}},{"id":"9cfb25f8-e95c-4cfe-a01f-32309410f40e","block_type":"box","text":"settlement cycle securities notwithstanding the limitation on the issuance of senior securities in Section 18 of the","page_number":86,"box":{"x":69,"y":680,"width":813,"height":11}},{"id":"b747a43b-7f7d-405d-a4fb-5196dc81d700","block_type":"box","text":"Investment Company Act, provided that the transaction meets the Delayed-Settlement Securities Provision (as","page_number":86,"box":{"x":70,"y":695,"width":783,"height":11}},{"id":"441ca06e-b657-4ff0-b8a5-7625e97c439a","block_type":"box","text":"defined below under “—When-Issued Securities, Delayed Delivery Securities and Forward Commitments”). If a when","page_number":86,"box":{"x":69,"y":710,"width":832,"height":11}},{"id":"40f5f4f9-7a12-4be5-a4d2-f10258115c67","block_type":"box","text":"issued, forward-settling or non-standard settlement cycle security does not satisfy the Delayed-Settlement Securities","page_number":86,"box":{"x":70,"y":725,"width":830,"height":11}},{"id":"cee15776-43e9-46c1-8caa-4a774f25aa8c","block_type":"box","text":"Provision, then it is treated as a Derivatives Transaction under Rule 18f-4. See “—Derivatives — Regulation of","page_number":86,"box":{"x":69,"y":740,"width":788,"height":11}},{"id":"359cefc9-4ff7-4c12-a491-72e411cbe5ee","block_type":"box","text":"Derivatives — Rule 18f-4 under the Investment Company Act” above.","page_number":86,"box":{"x":70,"y":755,"width":489,"height":11}},{"id":"bf09c171-fb61-4996-aa23-3208e25ddfa6","block_type":"box","text":"Net Interest Margin (NIM) Securities.","page_number":86,"box":{"x":102,"y":778,"width":260,"height":11}},{"id":"0d540b38-7317-44d6-87ce-98ae84e725cd","block_type":"box","text":"A Fund may invest in net interest margin (“NIM”) securities. These","page_number":86,"box":{"x":368,"y":778,"width":473,"height":11}},{"id":"3fca1e4e-00e9-4c57-b753-fc8b4a640df1","block_type":"box","text":"securities are derivative interest-only mor tgage securities structured off home equity loan transactions. NIM","page_number":86,"box":{"x":69,"y":793,"width":768,"height":11}},{"id":"3efbd8e9-56c9-45b6-9152-033c05b41577","block_type":"box","text":"securities receive any “excess” interest computed after paying coupon costs, servicing costs and fees and any credit","page_number":86,"box":{"x":69,"y":808,"width":836,"height":11}},{"id":"dfc1bf33-f29c-47ae-b484-27d54a5ccbe1","block_type":"box","text":"losses associated with the underlying pool of home equity loans. Like traditional stripped mor tgage-backed","page_number":86,"box":{"x":70,"y":823,"width":760,"height":12}},{"id":"74cf010e-0f2a-4dd2-a593-e6795c57500b","block_type":"box","text":"securities, the yield to maturity on a NIM security is sensitive not only to changes in prevailing interest rates but also","page_number":86,"box":{"x":69,"y":839,"width":832,"height":11}},{"id":"b4b7f78a-6580-4ee9-8031-f9989e3e23f6","block_type":"box","text":"to the rate of principal payments (including prepayments) on the underlying home equity loans. NIM securities are","page_number":86,"box":{"x":68,"y":853,"width":810,"height":12}},{"id":"b5f2a041-094d-4852-b586-73aa8ca17de4","block_type":"box","text":"highly sensitive to credit losses on the underlying collateral and the timing in which those losses are taken.","page_number":86,"box":{"x":69,"y":869,"width":764,"height":11}},{"id":"d22d2cb4-7606-4492-9c2e-cfec69bfce31","block_type":"box","text":"Municipal Investments.","page_number":86,"box":{"x":102,"y":891,"width":169,"height":11}},{"id":"a402ab25-24cd-4e70-a24f-53da3d68aa0d","block_type":"box","text":"II-55","page_number":86,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"3ba7abaf-7478-4418-a730-8849c054502b","block_type":"box","text":"NM1026U-5982568-86/232","page_number":86,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"48f8a78b-3bfe-47d7-a4cd-836b05773d81","block_type":"box","text":"Cer tain Funds may invest in obligations issued by or on behalf of states, territories and possessions of the","page_number":87,"box":{"x":102,"y":45,"width":763,"height":11}},{"id":"e748a0d7-a042-429c-b71b-73eb5194cd23","block_type":"box","text":"United States and the District of Columbia and their political subdivisions, agencies and instrumentalities, the","page_number":87,"box":{"x":70,"y":60,"width":783,"height":11}},{"id":"0640aa55-97ec-408e-99c8-494fab5b7e89","block_type":"box","text":"payments from which, in the opinion of bond counsel to the issuer, are excludable from gross income for U.S. federal","page_number":87,"box":{"x":70,"y":75,"width":833,"height":11}},{"id":"ac9c142e-a676-4ecb-acd5-b5d20846cda3","block_type":"box","text":"income tax purposes (“Municipal Bonds”). Cer tain of the Municipal Funds may also invest in Municipal Bonds that","page_number":87,"box":{"x":70,"y":90,"width":813,"height":11}},{"id":"5e7c7675-cff2-4c9d-91e5-e00cf73772a4","block_type":"box","text":"pay interest excludable from gross income for purposes of state and local income taxes of the designated state and/","page_number":87,"box":{"x":70,"y":105,"width":836,"height":11}},{"id":"669d3eb0-2cfe-426d-a756-0bf44f4eafa8","block_type":"box","text":"or allow the value of a Fund’s shares to be exempt from state and local taxes of the designated state (“State","page_number":87,"box":{"x":69,"y":120,"width":779,"height":12}},{"id":"e650c19d-b953-4e36-a414-0df67d72edfe","block_type":"box","text":"Municipal Bonds”). The Municipal Funds may also invest in securities not issued by or on behalf of a state or territory","page_number":87,"box":{"x":70,"y":135,"width":838,"height":11}},{"id":"c4b9144d-b846-4a18-89f0-d25de8ce4dcb","block_type":"box","text":"or by an agency or instrumentality thereof, if the Manager believes such securities to pay interest excludable from","page_number":87,"box":{"x":69,"y":150,"width":810,"height":12}},{"id":"a1af2bda-a87c-4fcf-829a-265d4619a813","block_type":"box","text":"gross income for purposes of U.S. federal income tax and state and local income taxes of the designated state and/","page_number":87,"box":{"x":68,"y":166,"width":834,"height":11}},{"id":"2fb620c6-4649-48d4-abb3-3f17194c6bd5","block_type":"box","text":"or state and local personal proper ty taxes of the designated state (“Non-Municipal Tax-Exempt Securities”). Non","page_number":87,"box":{"x":69,"y":181,"width":801,"height":11}},{"id":"f992f2ca-f362-436e-9b92-5ac443468f5f","block_type":"box","text":"Municipal Tax-Exempt Securities could include trust cer tificates or other instruments evidencing interest in one or","page_number":87,"box":{"x":70,"y":196,"width":807,"height":11}},{"id":"f3e1d63a-72b0-461a-98ce-2ade9849ed27","block_type":"box","text":"more long-term municipal securities. Non-Municipal Tax-Exempt Securities also may include securities issued by other","page_number":87,"box":{"x":69,"y":211,"width":837,"height":11}},{"id":"3bd57f16-c077-47d1-af18-aef6e2bfcd90","block_type":"box","text":"investment companies that invest in municipal bonds, to the extent such investments are permitted by applicable","page_number":87,"box":{"x":70,"y":226,"width":809,"height":11}},{"id":"e2233ec8-2d05-46a4-86a5-22530cae6b92","block_type":"box","text":"law. Non-Municipal Tax-Exempt Securities that pay interest excludable from gross income for U.S. federal income tax","page_number":87,"box":{"x":70,"y":241,"width":826,"height":11}},{"id":"24f75a29-1cac-4627-b2f6-475c9bbc16fa","block_type":"box","text":"purposes will be considered “Municipal Bonds” for purposes of a Municipal Fund’s investment objective and policies.","page_number":87,"box":{"x":70,"y":256,"width":834,"height":11}},{"id":"d9201465-6579-4b17-9e92-d053be9724a4","block_type":"box","text":"Non-Municipal Tax-Exempt Securities that pay interest excludable from gross income for purposes of U.S. federal","page_number":87,"box":{"x":70,"y":271,"width":800,"height":12}},{"id":"540a37bd-0347-4338-a534-9b480148aad0","block_type":"box","text":"income tax and state and local income taxes of a designated state and/or allow the value of a Fund’s shares to be","page_number":87,"box":{"x":70,"y":286,"width":819,"height":12}},{"id":"ee9c3320-bb10-4a8f-b386-79b1e1d7883d","block_type":"box","text":"exempt from state and local personal proper ty taxes of that state will be considered “State Municipal Bonds” for","page_number":87,"box":{"x":69,"y":302,"width":805,"height":11}},{"id":"cd1912af-4bc1-4ffc-92a3-151e1360b0ed","block_type":"box","text":"purposes of the investment objective and policies of each of California Municipal Oppor tunities Fund, New Jersey","page_number":87,"box":{"x":70,"y":317,"width":805,"height":11}},{"id":"cda19a52-d585-4244-99d8-d01951c54ca8","block_type":"box","text":"Municipal Bond Fund, New York Municipal Oppor tunities Fund and Pennsylvania Municipal Bond Fund.","page_number":87,"box":{"x":70,"y":332,"width":721,"height":11}},{"id":"655279c5-aeb6-4c7d-954b-69057f6ffe24","block_type":"box","text":"Risk Factors and Special Considerations Relating to Municipal Bonds.","page_number":87,"box":{"x":102,"y":355,"width":495,"height":11}},{"id":"add9bb9d-d56d-41de-85b6-eddab0554d93","block_type":"box","text":"The risks and special considerations","page_number":87,"box":{"x":603,"y":355,"width":260,"height":11}},{"id":"234f2a9a-c6fa-49e7-9e55-b6eab0f7dd5a","block_type":"box","text":"involved in investment in Municipal Bonds vary with the types of instruments being acquired. Investments in Non","page_number":87,"box":{"x":70,"y":370,"width":806,"height":11}},{"id":"fa39fcc5-ec7b-4e43-9db2-9adc752479e0","block_type":"box","text":"Municipal Tax-Exempt Securities may present similar risks, depending on the par ticular product. Cer tain municipal","page_number":87,"box":{"x":70,"y":385,"width":810,"height":11}},{"id":"9fb21f98-c639-464c-9738-d3a2a8ebd6a4","block_type":"box","text":"instruments in which a Fund may invest may be characterized as derivatives.","page_number":87,"box":{"x":70,"y":400,"width":544,"height":11}},{"id":"d3401e3b-2d83-4637-b7a5-b7fd55d23f20","block_type":"box","text":"The value of Municipal Bonds generally may be affected by uncer tainties in the municipal markets as a result of","page_number":87,"box":{"x":101,"y":423,"width":799,"height":11}},{"id":"8681398b-19d1-4f39-8f40-2415bd220b3f","block_type":"box","text":"legislation or litigation, including legislation or litigation that changes the taxation of Municipal Bonds or the rights of","page_number":87,"box":{"x":70,"y":438,"width":829,"height":11}},{"id":"f4da5cd6-a38e-42d3-bcec-24a35ae6e62e","block_type":"box","text":"Municipal Bond holders in the event of a bankruptcy. Municipal bankruptcies are rare and cer tain provisions of the","page_number":87,"box":{"x":70,"y":453,"width":814,"height":11}},{"id":"2b4ac15d-df39-4f6c-b8c1-b19380664960","block_type":"box","text":"U.S. Bankruptcy Code governing such bankruptcies are unclear. Fur ther, the application of state law to Municipal","page_number":87,"box":{"x":70,"y":468,"width":802,"height":11}},{"id":"70e00d6a-2957-44cb-ad45-93e6f5c91d16","block_type":"box","text":"Bond issuers could produce varying results among the states or among Municipal Bond issuers within a state. These","page_number":87,"box":{"x":70,"y":483,"width":834,"height":11}},{"id":"5f7072f9-9dad-4c56-a1a0-ccd10090709a","block_type":"box","text":"uncer tainties could have a significant impact on the prices of the Municipal Bonds in which a Fund invests.","page_number":87,"box":{"x":69,"y":498,"width":761,"height":11}},{"id":"f3e6d1a9-b5cd-4e7f-90b7-178619e4f56a","block_type":"box","text":"II-56","page_number":87,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"58966c3d-a23d-4ca0-b7d4-9242856310e9","block_type":"box","text":"NM1026U-5982568-87/232","page_number":87,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"97c61502-6472-4d48-b822-7368db5d8547","block_type":"box","text":"Description of Municipal Bonds.","page_number":88,"box":{"x":70,"y":45,"width":224,"height":11}},{"id":"acc1d530-f50c-4290-8c7c-0a10d38bd7ef","block_type":"box","text":"Municipal Bonds include debt obligations issued to obtain funds for various public purposes, including the","page_number":88,"box":{"x":102,"y":67,"width":754,"height":12}},{"id":"44bce426-4ba7-4488-af76-09b96f4ddafd","block_type":"box","text":"construction of a wide range of public facilities, refunding of outstanding obligations and obtaining funds for general","page_number":88,"box":{"x":69,"y":82,"width":824,"height":12}},{"id":"90d24eef-9dab-4438-8a2f-6e15880e5635","block_type":"box","text":"operating expenses and loans to other public institutions and facilities. In addition, cer tain types of bonds are issued","page_number":88,"box":{"x":69,"y":98,"width":836,"height":11}},{"id":"260e19b0-4da3-4b6c-b45b-f4061c7b0c3e","block_type":"box","text":"by or on behalf of public authorities to finance various privately owned or operated facilities, including cer tain","page_number":88,"box":{"x":69,"y":113,"width":776,"height":11}},{"id":"6577962d-f5a1-4b73-bcdd-7217aad2c5e3","block_type":"box","text":"facilities for the local furnishing of electric energy or gas, sewage facilities, solid waste disposal facilities and other","page_number":88,"box":{"x":68,"y":128,"width":822,"height":11}},{"id":"f334c12b-541e-42c6-bbb5-6bcf9b8b929f","block_type":"box","text":"specialized facilities. Such obligations are included within the term Municipal Bonds if the interest paid thereon is","page_number":88,"box":{"x":69,"y":143,"width":810,"height":11}},{"id":"485dacc4-8a2b-430d-b065-e2cb214f220f","block_type":"box","text":"excluded from gross income for U.S. federal income tax purposes and any applicable state and local taxes. Other","page_number":88,"box":{"x":69,"y":158,"width":808,"height":11}},{"id":"6281ee48-f6e1-4740-88ce-95c4535577c6","block_type":"box","text":"types of private activity bonds, the proceeds of which are used for the construction, equipment or improvement of","page_number":88,"box":{"x":68,"y":173,"width":812,"height":11}},{"id":"bfbfbed7-aa5b-4585-83ba-208aed0a5cc0","block_type":"box","text":"privately operated industrial or commercial facilities, may constitute Municipal Bonds, although the current U.S.","page_number":88,"box":{"x":70,"y":188,"width":792,"height":12}},{"id":"1b94bc84-08c9-42f2-aec6-893a6229dfc2","block_type":"box","text":"federal tax laws place substantial limitations on the size of such issues. The interest on Municipal Bonds may bear a","page_number":88,"box":{"x":68,"y":203,"width":835,"height":12}},{"id":"d7fc7989-a82f-4960-b3ef-5c3e490740a8","block_type":"box","text":"fixed rate or be payable at a variable or floating rate. The two principal classifications of Municipal Bonds are “general","page_number":88,"box":{"x":68,"y":218,"width":840,"height":12}},{"id":"1a543dd5-89c7-4459-9908-d4ba2dd46909","block_type":"box","text":"obligation” and “revenue” or “special obligation” bonds, which latter category includes private activity bonds (“PABs”)","page_number":88,"box":{"x":69,"y":234,"width":838,"height":11}},{"id":"02be9a18-d761-4dfe-bcf5-e35532f29579","block_type":"box","text":"(or “industrial development bonds” under pre-1986 law).","page_number":88,"box":{"x":69,"y":249,"width":401,"height":11}},{"id":"9b06e5a5-8493-4bea-9e90-37061a507ccb","block_type":"box","text":"General Obligation Bonds.","page_number":88,"box":{"x":102,"y":272,"width":184,"height":11}},{"id":"7205e3f6-9903-4950-81ba-75ef92f7fffe","block_type":"box","text":"General obligation bonds are secured by the issuer’s pledge of its full faith, credit and","page_number":88,"box":{"x":292,"y":271,"width":613,"height":12}},{"id":"dfbcd810-60ab-406e-8518-61b817b24f79","block_type":"box","text":"taxing power for the payment of principal and interest. The taxing power of any governmental entity may be limited,","page_number":88,"box":{"x":68,"y":286,"width":816,"height":12}},{"id":"f2e94828-4f65-4e19-84ee-8690f5a8f89d","block_type":"box","text":"however, by provisions of its state constitution or laws, and an entity’s creditwor thiness will depend on many factors,","page_number":88,"box":{"x":69,"y":302,"width":834,"height":11}},{"id":"fc2e07e5-a91f-4f80-97d1-30b864f646bd","block_type":"box","text":"including potential erosion of its tax base due to population declines, natural disasters, declines in the state’s","page_number":88,"box":{"x":70,"y":317,"width":786,"height":11}},{"id":"c8f3ab8f-c7b8-4086-a905-c55e2cc84fb4","block_type":"box","text":"industrial base or inability to attract new industries, economic limits on the ability to tax without eroding the tax base,","page_number":88,"box":{"x":70,"y":332,"width":835,"height":11}},{"id":"96eab37d-262a-4e4d-acf2-6c47cc629018","block_type":"box","text":"state legislative proposals or voter initiatives to limit ad valorem real proper ty taxes and the extent to which the entity","page_number":88,"box":{"x":69,"y":347,"width":840,"height":11}},{"id":"40701250-55d0-44c2-a02e-f95c79e28003","block_type":"box","text":"relies on federal or state aid, access to capital markets or other factors beyond the state’s or entity’s control.","page_number":88,"box":{"x":69,"y":362,"width":782,"height":11}},{"id":"cb16b899-76b9-444c-821b-74ad273a9d73","block_type":"box","text":"Accordingly, the capacity of the issuer of a general obligation bond as to the timely payment of interest and the","page_number":88,"box":{"x":68,"y":377,"width":791,"height":12}},{"id":"2089b830-47ed-4c70-a2ad-6ad9db46ea29","block_type":"box","text":"repayment of principal when due is affected by the issuer’s maintenance of its tax base.","page_number":88,"box":{"x":69,"y":392,"width":630,"height":12}},{"id":"f91af473-22f3-45a6-9539-83c06b38387d","block_type":"box","text":"Revenue Bonds.","page_number":88,"box":{"x":102,"y":415,"width":114,"height":9}},{"id":"d0abcc91-ac7f-49da-be82-da91009f7f75","block_type":"box","text":"Revenue bonds are payable only from the revenues derived from a par ticular facility or class of","page_number":88,"box":{"x":223,"y":415,"width":676,"height":11}},{"id":"ed568215-3228-495f-ab6e-dbc7c2bd2884","block_type":"box","text":"facilities or, in some cases, from the proceeds of a special excise tax or other specific revenue source such as","page_number":88,"box":{"x":68,"y":430,"width":791,"height":11}},{"id":"4deab7cf-3869-4f24-b613-b5b265122810","block_type":"box","text":"payments from the user of the facility being financed; accordingly, the timely payment of interest and the repayment","page_number":88,"box":{"x":70,"y":445,"width":824,"height":12}},{"id":"7a89baf3-1910-4982-bedd-2ba1ad394bab","block_type":"box","text":"of principal in accordance with the terms of the revenue or special obligation bond is a function of the economic","page_number":88,"box":{"x":69,"y":460,"width":798,"height":12}},{"id":"ee796b1e-2fb8-4bcf-9301-e8e4412d82d2","block_type":"box","text":"viability of such facility or such revenue source.","page_number":88,"box":{"x":68,"y":475,"width":336,"height":12}},{"id":"42b882b1-5d28-4cd6-955a-b43cd0de7e86","block_type":"box","text":"Revenue bonds issued by state or local agencies to finance the development of low-income, multi-family housing","page_number":88,"box":{"x":102,"y":498,"width":801,"height":11}},{"id":"9bccac10-e007-446b-9ca3-a770c9a92b5f","block_type":"box","text":"involve special risks in addition to those associated with municipal bonds generally, including that the underlying","page_number":88,"box":{"x":70,"y":514,"width":800,"height":11}},{"id":"598bdf95-7c8b-4e77-b2ca-d59aea33dfb5","block_type":"box","text":"proper ties may not generate sufficient income to pay expenses and interest costs. Such bonds are generally non","page_number":88,"box":{"x":70,"y":528,"width":810,"height":12}},{"id":"c8fcf2cf-a5d3-43e8-a539-939619a9248b","block_type":"box","text":"recourse against the proper ty owner, may be junior to the rights of others with an interest in the proper ties, may pay","page_number":88,"box":{"x":69,"y":543,"width":830,"height":12}},{"id":"f556bf99-af04-42ca-bdee-882a36352842","block_type":"box","text":"interest that changes based in par t on the financial per formance of the proper ty, may be prepayable without penalty","page_number":88,"box":{"x":70,"y":559,"width":828,"height":11}},{"id":"001a45dd-6625-4d60-9402-2a15a4a54211","block_type":"box","text":"and may be used to finance the construction of housing developments which, until completed and rented, do not","page_number":88,"box":{"x":69,"y":574,"width":804,"height":11}},{"id":"ac680811-77c1-4536-bdbc-98a4e4e13f6b","block_type":"box","text":"generate income to pay interest. Increases in interest rates payable on senior obligations may make it more difficult","page_number":88,"box":{"x":68,"y":589,"width":830,"height":11}},{"id":"57a34c41-c60a-4a98-a2d9-bb88f68f227f","block_type":"box","text":"for issuers to meet payment obligations on subordinated bonds.","page_number":88,"box":{"x":68,"y":604,"width":457,"height":11}},{"id":"6ffd586f-d7f4-495d-a10d-3cf712d13f57","block_type":"box","text":"PABs.","page_number":88,"box":{"x":102,"y":627,"width":38,"height":9}},{"id":"4482540a-bcc5-48b3-bd3a-81422557422b","block_type":"box","text":"PABs are, in most cases, tax-exempt securities issued by states, municipalities or public authorities to","page_number":88,"box":{"x":147,"y":627,"width":730,"height":11}},{"id":"55562038-1b0f-4fbe-92ea-c6dbabbad7e9","block_type":"box","text":"provide funds, usually through a loan or lease arrangement, to a private entity for the purpose of financing","page_number":88,"box":{"x":70,"y":642,"width":755,"height":11}},{"id":"606e2843-d0e3-409a-b2ec-e07f1a1a45e8","block_type":"box","text":"construction or improvement of a facility to be used by the entity. Such bonds are secured primarily by revenues","page_number":88,"box":{"x":69,"y":657,"width":797,"height":11}},{"id":"cecbb4e7-730d-478d-bc6f-96a32461ecf3","block_type":"box","text":"derived from loan repayments or lease payments due from the entity, which may or may not be guaranteed by a","page_number":88,"box":{"x":69,"y":672,"width":793,"height":11}},{"id":"e41add46-dbc4-41e5-a86d-31b6888ce31b","block_type":"box","text":"parent company or otherwise secured. PABs generally are not secured by a pledge of the taxing power of the issuer of","page_number":88,"box":{"x":70,"y":687,"width":840,"height":11}},{"id":"3089d836-44cf-4de7-b494-5e279b9f2011","block_type":"box","text":"such bonds. Therefore, an investor should understand that repayment of such bonds generally depends on the","page_number":88,"box":{"x":69,"y":702,"width":789,"height":12}},{"id":"43a8fabb-a571-4777-ad53-48a30fde2e1a","block_type":"box","text":"revenues of a private entity and be aware of the risks that such an investment may entail. The continued ability of an","page_number":88,"box":{"x":69,"y":717,"width":832,"height":12}},{"id":"82d4adba-0605-4472-ba2a-f0ea91b40e37","block_type":"box","text":"entity to generate sufficient revenues for the payment of principal and interest on such bonds will be affected by","page_number":88,"box":{"x":69,"y":732,"width":802,"height":12}},{"id":"e4d6b219-baa7-4592-85cf-44c41ec67685","block_type":"box","text":"many factors including the size of the entity, its capital structure, demand for its products or services, competition,","page_number":88,"box":{"x":69,"y":748,"width":819,"height":11}},{"id":"dc43b7ad-65cd-406a-9ac1-2bf34709564c","block_type":"box","text":"general economic conditions, government regulation and the entity’s dependence on revenues for the operation of","page_number":88,"box":{"x":68,"y":763,"width":816,"height":11}},{"id":"bf421464-a16c-4e25-a36d-cb627c35c5d3","block_type":"box","text":"the par ticular facility being financed.","page_number":88,"box":{"x":68,"y":778,"width":258,"height":11}},{"id":"e20175e4-fb01-45a6-ab0d-bb1cdcc14f38","block_type":"box","text":"Moral Obligation Bonds.","page_number":88,"box":{"x":102,"y":801,"width":169,"height":11}},{"id":"185422e8-4b0c-499f-887f-6b9cf4b5fd80","block_type":"box","text":"“Moral obligation” bonds are normally issued by special purpose public authorities. If an","page_number":88,"box":{"x":278,"y":801,"width":628,"height":11}},{"id":"1ba74ba8-62f1-4dc5-b82a-92b3cb4d7ca4","block_type":"box","text":"issuer of moral obligation bonds is unable to meet its obligations, the repayment of such bonds becomes a moral","page_number":88,"box":{"x":70,"y":816,"width":809,"height":11}},{"id":"9f45711f-ccb3-49c2-958e-e431b3e90607","block_type":"box","text":"commitment but not a legal obligation of the state or municipality that created the special purpose public authority","page_number":88,"box":{"x":69,"y":831,"width":816,"height":11}},{"id":"d03fba91-7a2d-4d38-9c78-d7e7f498b837","block_type":"box","text":"that issued the bonds.","page_number":88,"box":{"x":68,"y":846,"width":160,"height":9}},{"id":"cb424ba7-65cd-40b7-bf4b-bbf00a5f9bc9","block_type":"box","text":"Municipal Notes.","page_number":88,"box":{"x":102,"y":869,"width":118,"height":11}},{"id":"b0ca3edf-0e32-4160-b97c-a0f30e1aa2d2","block_type":"box","text":"Municipal notes are shor ter term municipal debt obligations. They may provide interim financing","page_number":88,"box":{"x":227,"y":869,"width":683,"height":11}},{"id":"253f52c6-63ea-4510-8cdb-e1f1a48f682d","block_type":"box","text":"in anticipation of tax collection, bond sales or revenue receipts. If there is a shor tfall in the anticipated proceeds,","page_number":88,"box":{"x":70,"y":884,"width":807,"height":11}},{"id":"89cd03d7-6c34-4f1f-86a5-b8006a6adeb8","block_type":"box","text":"repayment on the note may be delayed or the note may not be fully repaid, and a Fund may lose money.","page_number":88,"box":{"x":69,"y":899,"width":739,"height":11}},{"id":"5986a828-7401-49a4-801c-1cfddcab6692","block_type":"box","text":"II-57","page_number":88,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"a8ac0c1d-d392-4d7c-85a9-dfb371d360cb","block_type":"box","text":"NM1026U-5982568-88/232","page_number":88,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"9ea6c496-bcea-40f5-bdec-3302e0eb7dbc","block_type":"box","text":"Municipal Commercial Paper.","page_number":89,"box":{"x":102,"y":45,"width":205,"height":11}},{"id":"944788e1-a38d-474c-b8eb-682e4edc6342","block_type":"box","text":"Municipal commercial paper is generally unsecured and issued to meet shor t-term","page_number":89,"box":{"x":314,"y":45,"width":586,"height":11}},{"id":"c35c53bd-65f0-46c8-964e-6c64c0f41e37","block_type":"box","text":"financing needs. The lack of security presents some risk of loss to a Fund since, in the event of an issuer’s","page_number":89,"box":{"x":68,"y":60,"width":767,"height":11}},{"id":"9f2ebc6e-cb14-4ab0-8a9c-6148e0523223","block_type":"box","text":"bankruptcy, unsecured creditors are repaid only after the secured creditors out of the assets, if any, that remain.","page_number":89,"box":{"x":69,"y":75,"width":803,"height":11}},{"id":"1b1d287b-a8ca-4376-9f90-1957526697f4","block_type":"box","text":"Municipal Lease Obligations.","page_number":89,"box":{"x":102,"y":98,"width":203,"height":11}},{"id":"031be249-011f-4376-ae9e-9b5925b81213","block_type":"box","text":"Also included within the general category of Municipal Bonds are cer tificates of","page_number":89,"box":{"x":311,"y":98,"width":566,"height":11}},{"id":"be99dbf7-8c4b-478a-84aa-feb8805e8258","block_type":"box","text":"par ticipation (“COPs”) issued by government authorities or entities to finance the acquisition or construction of","page_number":89,"box":{"x":70,"y":113,"width":791,"height":11}},{"id":"2e6f501e-1c51-4761-8b21-21426e510d4a","block_type":"box","text":"equipment, land and/or facilities. The COPs represent par ticipations in a lease, an installment purchase contract or a","page_number":89,"box":{"x":69,"y":128,"width":840,"height":11}},{"id":"19a09e3b-1015-4b30-ae51-c667fa01056a","block_type":"box","text":"conditional sales contract (hereinafter collectively called “lease obligations”) relating to such equipment, land or","page_number":89,"box":{"x":69,"y":143,"width":800,"height":11}},{"id":"3fc82451-0521-4f3d-8bd7-4b02289ddd20","block_type":"box","text":"facilities. Municipal leases, like other municipal debt obligations, are subject to the risk of non-payment. Although","page_number":89,"box":{"x":68,"y":158,"width":809,"height":11}},{"id":"f334b616-494b-45f3-95e4-d5143a5ec009","block_type":"box","text":"lease obligations do not constitute general obligations of the issuer for which the issuer’s unlimited taxing power is","page_number":89,"box":{"x":70,"y":173,"width":820,"height":11}},{"id":"1e657a40-dfbb-4eaf-a309-9daa3c57c05b","block_type":"box","text":"pledged, a lease obligation is frequently backed by the issuer’s covenant to budget for, appropriate and make the","page_number":89,"box":{"x":70,"y":188,"width":808,"height":12}},{"id":"7703baea-cba5-4253-8c72-125d6e3ea6b1","block_type":"box","text":"payments due under the lease obligation. However, cer tain lease obligations contain “non-appropriation” clauses,","page_number":89,"box":{"x":70,"y":204,"width":809,"height":11}},{"id":"6d68fd40-b466-4a89-af8c-8acf038bb892","block_type":"box","text":"which provide that the issuer has no obligation to make lease or installment purchase payments in future years","page_number":89,"box":{"x":68,"y":218,"width":795,"height":12}},{"id":"740debc3-de1d-47a2-9e5b-0fabff85fe4a","block_type":"box","text":"unless money is appropriated for such purpose on a yearly basis. Although “non-appropriation” lease obligations are","page_number":89,"box":{"x":69,"y":234,"width":829,"height":11}},{"id":"594e4608-ae12-435a-a4d0-96c3eb23331d","block_type":"box","text":"secured by the leased proper ty, disposition of the proper ty in the event of foreclosure might prove difficult. These","page_number":89,"box":{"x":69,"y":249,"width":810,"height":11}},{"id":"a3b57035-179b-45b3-982e-926876916cdf","block_type":"box","text":"securities represent a type of financing that has not yet developed the depth of marketability associated with more","page_number":89,"box":{"x":69,"y":264,"width":817,"height":11}},{"id":"db14711b-d291-47b2-9359-cdcc1f1b1877","block_type":"box","text":"conventional securities. Cer tain investments in lease obligations may be illiquid.","page_number":89,"box":{"x":69,"y":279,"width":572,"height":11}},{"id":"2f397234-8dec-4452-8575-fbffbb223006","block_type":"box","text":"The ability of issuers of municipal leases to make timely lease payments may be adversely impacted in general","page_number":89,"box":{"x":101,"y":302,"width":791,"height":11}},{"id":"07e2f9ca-5d88-4538-8a73-58a925aa0110","block_type":"box","text":"economic downturns and as relative governmental cost burdens are allocated and reallocated among federal, state","page_number":89,"box":{"x":69,"y":317,"width":822,"height":11}},{"id":"d7911772-39af-496d-80a1-f79020ebab60","block_type":"box","text":"and local governmental units. Such non-payment would result in a reduction of income to a Fund and could result in a","page_number":89,"box":{"x":69,"y":332,"width":837,"height":11}},{"id":"5ee02c85-7200-4357-a9ac-757807e5f713","block_type":"box","text":"reduction in the value of the municipal lease experiencing non-payment and a potential decrease in the NAV of a","page_number":89,"box":{"x":69,"y":347,"width":798,"height":11}},{"id":"c85bce72-f472-4caf-9333-cd00e5968c91","block_type":"box","text":"Fund. Issuers of municipal securities might seek protection under the bankruptcy laws. In the event of bankruptcy of","page_number":89,"box":{"x":70,"y":362,"width":828,"height":11}},{"id":"66c0c486-539b-4ad8-9d1f-a278d2ec8f7e","block_type":"box","text":"such an issuer, a Fund could experience delays and limitations with respect to the collection of principal and interest","page_number":89,"box":{"x":69,"y":377,"width":833,"height":11}},{"id":"ef323405-67a1-4bde-98eb-7f60f726bba9","block_type":"box","text":"on such municipal leases and a Fund may not, in all circumstances, be able to collect all principal and interest to","page_number":89,"box":{"x":69,"y":393,"width":807,"height":11}},{"id":"f192e741-9d92-460f-b010-ad0aef640b47","block_type":"box","text":"which it is entitled. To enforce its rights in the event of a default in lease payments, a Fund might take possession of","page_number":89,"box":{"x":68,"y":407,"width":835,"height":12}},{"id":"47f91944-6f21-47da-9aa2-bb93b26f1c57","block_type":"box","text":"and manage the assets securing the issuer’s obligations on such securities, which may increase a Fund’s operating","page_number":89,"box":{"x":69,"y":423,"width":828,"height":11}},{"id":"28e08b5b-c6b2-42ae-b71f-24f8e74e5347","block_type":"box","text":"expenses and adversely affect the NAV of a Fund. When the lease contains a non-appropriation clause, however, the","page_number":89,"box":{"x":69,"y":438,"width":829,"height":11}},{"id":"3bf8bc88-4fc1-4519-82f7-3be85a52d6cb","block_type":"box","text":"failure to pay would not be a default and a Fund would not have the right to take possession of the assets. Any","page_number":89,"box":{"x":68,"y":453,"width":793,"height":11}},{"id":"b9318864-d084-424e-ba8c-07c31cd9a31e","block_type":"box","text":"income derived from a Fund’s ownership or operation of such assets may not be tax-exempt. In addition, a Fund’s","page_number":89,"box":{"x":70,"y":468,"width":810,"height":11}},{"id":"41edb728-ab8f-4485-baa6-f6a48a9d8c85","block_type":"box","text":"intention to qualify as a “regulated investment company” under the Code, may limit the extent to which a Fund may","page_number":89,"box":{"x":70,"y":483,"width":820,"height":11}},{"id":"2fbdd71f-29f2-4429-9214-a8d5a874d5cc","block_type":"box","text":"exercise its rights by taking possession of such assets, because as a regulated investment company a Fund is","page_number":89,"box":{"x":69,"y":498,"width":790,"height":11}},{"id":"b185f978-392f-4be6-9c0e-f3a31dbeeca0","block_type":"box","text":"subject to cer tain limitations on its investments and on the nature of its income.","page_number":89,"box":{"x":69,"y":513,"width":574,"height":11}},{"id":"cf4d583f-4f65-4322-8cde-923365e43efd","block_type":"box","text":"Tender Option Bonds.","page_number":89,"box":{"x":103,"y":536,"width":150,"height":11}},{"id":"a19cf9de-f5e4-461f-8668-a3d6b80c9bdd","block_type":"box","text":"Cer tain Funds may invest in residual inverse floating rate interest tender option bonds","page_number":89,"box":{"x":260,"y":536,"width":613,"height":11}},{"id":"4224606f-ae94-4b9d-bd00-ca4c5e500872","block_type":"box","text":"(“TOB Residuals”), which are derivative interests in Municipal Bonds. The TOB Residuals in which the Funds will","page_number":89,"box":{"x":69,"y":551,"width":796,"height":11}},{"id":"82fbed38-eadb-47b9-bfbd-c919a6763a69","block_type":"box","text":"invest pay interest or income that, in the opinion of counsel to the issuer, is exempt from regular U.S. federal income","page_number":89,"box":{"x":70,"y":566,"width":834,"height":11}},{"id":"ee16aba4-b7d2-4c9f-b8ae-305d8ee359b0","block_type":"box","text":"tax. BlackRock will not conduct its own analysis of the tax status of the interest or income paid by TOB Residuals","page_number":89,"box":{"x":68,"y":581,"width":807,"height":11}},{"id":"f29e7ef9-b5c9-41ef-a743-e39ef7d2f9d8","block_type":"box","text":"held by the Funds, but will rely on the opinion of counsel to the issuer. Although volatile, TOB Residuals typically offer","page_number":89,"box":{"x":69,"y":596,"width":836,"height":12}},{"id":"baf2e694-ea44-4e9c-abdf-7d19a07d6035","block_type":"box","text":"the potential for yields exceeding the yields available on fixed rate Municipal Bonds with comparable credit quality.","page_number":89,"box":{"x":68,"y":612,"width":814,"height":11}},{"id":"503b194f-b605-4dd8-8987-0474a977f512","block_type":"box","text":"The Funds may invest in TOB Residuals for the purpose of using economic leverage.","page_number":89,"box":{"x":68,"y":627,"width":598,"height":11}},{"id":"6ed31661-5b89-4baf-8da7-50e1f985e664","block_type":"box","text":"TOB Residuals represent beneficial interests in a special purpose trust formed for the purpose of holding","page_number":89,"box":{"x":101,"y":649,"width":751,"height":12}},{"id":"89b1c283-17ff-4c0e-bee5-84cb206f2525","block_type":"box","text":"Municipal Bonds contributed by one or more funds (a “TOB Trust”). A TOB Trust typically issues two classes of","page_number":89,"box":{"x":70,"y":664,"width":786,"height":12}},{"id":"d788785e-0ed0-43d6-b796-b51a137d27a9","block_type":"box","text":"beneficial interests: shor t-term floating rate interests (“TOB Floaters”), which are sold to third-par ty investors, and","page_number":89,"box":{"x":69,"y":680,"width":813,"height":11}},{"id":"7668c589-6809-4c8b-9eec-15a2f7c69916","block_type":"box","text":"TOB Residuals, which are generally issued to the fund(s) that transferred Municipal Bonds to the TOB Trust. The","page_number":89,"box":{"x":68,"y":695,"width":799,"height":11}},{"id":"b53857b2-452a-4503-a2d2-60f91af2e5b4","block_type":"box","text":"Funds may invest in both TOB Floaters and TOB Residuals. TOB Floaters may have first priority on the cash flow from","page_number":89,"box":{"x":70,"y":710,"width":830,"height":11}},{"id":"f0ddd32f-8810-447f-838b-c47d2f9284b8","block_type":"box","text":"the Municipal Bonds held by the TOB Trust and are enhanced with a liquidity suppor t arrangement from a third-par ty","page_number":89,"box":{"x":68,"y":725,"width":828,"height":11}},{"id":"49a74b56-6782-4587-901f-a739861cc131","block_type":"box","text":"Liquidity Provider (defined below) which allows holders to tender their position at par (plus accrued interest). A Fund,","page_number":89,"box":{"x":70,"y":740,"width":826,"height":11}},{"id":"3143b8ed-6b6b-454c-8ae5-52311abb180f","block_type":"box","text":"as a holder of TOB Residuals, is paid the residual cash flow from the TOB Trust. A Fund that contributes the","page_number":89,"box":{"x":69,"y":755,"width":768,"height":11}},{"id":"8823c861-ca38-4660-8cda-bf7d3ab475a9","block_type":"box","text":"Municipal Bonds to the TOB Trust is paid the cash received by the TOB Trust from the sale of the TOB Floaters, less","page_number":89,"box":{"x":70,"y":770,"width":825,"height":11}},{"id":"2af45783-17d6-4379-9ff0-c164a99f3dea","block_type":"box","text":"cer tain transaction costs, and typically will invest the cash to purchase additional Municipal Bonds or other","page_number":89,"box":{"x":69,"y":786,"width":764,"height":11}},{"id":"1373ab76-ea6f-47ec-81a0-13ff3f20009d","block_type":"box","text":"investments permitted by its investment policies. If a Fund ever purchases all or a por tion of the TOB Floaters sold by","page_number":89,"box":{"x":70,"y":801,"width":838,"height":11}},{"id":"d33731a1-2b10-4376-99e6-6402f4d94aa9","block_type":"box","text":"the TOB Trust, it may surrender those TOB Floaters together with a propor tionate amount of TOB Residuals to the","page_number":89,"box":{"x":68,"y":816,"width":810,"height":11}},{"id":"01214f33-baef-46d1-be66-52987ac1ea43","block_type":"box","text":"TOB Trust in exchange for a propor tionate amount of the Municipal Bonds owned by the TOB Trust.","page_number":89,"box":{"x":68,"y":831,"width":704,"height":11}},{"id":"ac22bdaf-208e-4c0a-8d9a-107fa6706d11","block_type":"box","text":"Other BlackRock-advised funds may contribute Municipal Bonds to a TOB Trust into which a Fund has contributed","page_number":89,"box":{"x":102,"y":853,"width":804,"height":12}},{"id":"d93a460c-1fc4-439f-af97-68a58d8f76c0","block_type":"box","text":"Municipal Bonds. If multiple BlackRock-advised funds par ticipate in the same TOB Trust, the economic rights and","page_number":89,"box":{"x":70,"y":869,"width":805,"height":11}},{"id":"9021d992-95a8-430f-8054-a5166c4afca5","block_type":"box","text":"obligations under the TOB Residual will generally be shared among the funds ratably in propor tion to their","page_number":89,"box":{"x":69,"y":884,"width":752,"height":11}},{"id":"1a514b43-a5e5-40bb-bbda-4af995eec4a9","block_type":"box","text":"par ticipation in the TOB Trust.","page_number":89,"box":{"x":70,"y":899,"width":211,"height":11}},{"id":"72169424-bf08-45dc-a182-e5c92892a094","block_type":"box","text":"II-58","page_number":89,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"750aac75-e385-4c6f-b020-c93acae16c82","block_type":"box","text":"NM1026U-5982568-89/232","page_number":89,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"32c0df8e-2017-4d10-bd85-1a47beb700bf","block_type":"box","text":"The Municipal Bonds transferred to a TOB Trust typically are high grade Municipal Bonds. In cer tain cases, when","page_number":90,"box":{"x":101,"y":45,"width":802,"height":11}},{"id":"0a20aa03-d339-4186-89ce-e43b02726142","block_type":"box","text":"Municipal Bonds transferred are lower grade Municipal Bonds, the TOB Trust transaction includes a credit","page_number":90,"box":{"x":70,"y":60,"width":753,"height":11}},{"id":"6bc4ac0b-02eb-4a1b-84f2-96a41b601e9d","block_type":"box","text":"enhancement feature that provides for the timely payment of principal and interest on the bonds to the TOB Trust by","page_number":90,"box":{"x":69,"y":75,"width":829,"height":11}},{"id":"5051a0df-962a-459c-bb3c-f903f84dcbd1","block_type":"box","text":"a credit enhancement provider. The TOB Trust would be responsible for the payment of the credit enhancement fee","page_number":90,"box":{"x":69,"y":90,"width":819,"height":11}},{"id":"f1f27f90-e4ad-4d1b-9010-c562f65f9c11","block_type":"box","text":"and a Fund, as a TOB Residual holder, would be responsible for reimbursement of any payments of principal and","page_number":90,"box":{"x":69,"y":105,"width":802,"height":11}},{"id":"dcf9e586-0324-4a89-85b6-af2367673f7d","block_type":"box","text":"interest made by the credit enhancement provider.","page_number":90,"box":{"x":70,"y":120,"width":357,"height":11}},{"id":"847582f1-9bf2-4491-8deb-3a75229266cd","block_type":"box","text":"The TOB Residuals held by a Fund generally provide the Fund with the right to cause the holders of a propor tional","page_number":90,"box":{"x":101,"y":143,"width":807,"height":11}},{"id":"20d487b5-552c-486d-974b-a2c16fa53b6d","block_type":"box","text":"share of the TOB Floaters to tender their notes to the TOB Trust at par plus accrued interest. Thereafter, the Fund","page_number":90,"box":{"x":69,"y":158,"width":810,"height":11}},{"id":"9275991e-e4a7-4d03-97c7-502baee9ef38","block_type":"box","text":"may withdraw a corresponding share of the Municipal Bonds from the TOB Trust. This transaction, in effect, creates","page_number":90,"box":{"x":69,"y":173,"width":825,"height":11}},{"id":"b0c2491c-41c2-4c39-b7d4-4cc7ccfb4b69","block_type":"box","text":"exposure for the Fund to the entire return of the Municipal Bonds in the TOB Trust, with a net cash investment by the","page_number":90,"box":{"x":69,"y":188,"width":834,"height":11}},{"id":"0f42d20e-eae7-45ca-8cc3-f7a00251ab68","block_type":"box","text":"Fund that is less than the value of the Municipal Bonds in the TOB Trust. This multiplies the positive or negative","page_number":90,"box":{"x":70,"y":203,"width":797,"height":12}},{"id":"08794d71-562a-4ee1-9e9d-dc7743f3544a","block_type":"box","text":"impact of the Municipal Bonds’ return within the Fund (thereby creating leverage). The leverage within a TOB Trust","page_number":90,"box":{"x":70,"y":218,"width":809,"height":12}},{"id":"d8f1c0df-052c-4d3d-9f96-a835d6365659","block_type":"box","text":"depends on the value of the Municipal Bonds deposited in the TOB Trust relative to the value of the TOB Floaters it","page_number":90,"box":{"x":69,"y":234,"width":820,"height":11}},{"id":"986fe207-790c-4b6a-89c9-9548840a6711","block_type":"box","text":"issues.","page_number":90,"box":{"x":70,"y":249,"width":49,"height":9}},{"id":"7502f64a-f621-44b4-82c5-aec5db4fd382","block_type":"box","text":"A Fund may invest in highly leveraged TOB Residuals. A TOB Residual generally is considered highly leveraged if","page_number":90,"box":{"x":101,"y":271,"width":795,"height":12}},{"id":"e971c621-ad36-488d-b478-40abb2f50b4c","block_type":"box","text":"the principal amount of the TOB Floaters issued by the related TOB Trust exceeds 75% of the principal amount of the","page_number":90,"box":{"x":68,"y":286,"width":833,"height":12}},{"id":"2b8e4c79-67a8-49e6-bf09-8da2113cc8f3","block_type":"box","text":"Municipal Bonds owned by the TOB Trust.","page_number":90,"box":{"x":70,"y":302,"width":293,"height":11}},{"id":"fa339902-9bf6-4b2f-9dd0-4fd7430f83c3","block_type":"box","text":"The TOB Trust may be collapsed without the consent of a Fund upon the occurrence of tender option termination","page_number":90,"box":{"x":101,"y":324,"width":802,"height":11}},{"id":"58ea987e-c808-42d7-b7e8-8960af57d9e6","block_type":"box","text":"events (“TOTEs”) and mandatory termination events (“MTEs”), as defined in the TOB Trust agreements. TOTEs","page_number":90,"box":{"x":69,"y":339,"width":788,"height":12}},{"id":"eae8a166-cd95-4264-beb2-40b6ec2582aa","block_type":"box","text":"include the bankruptcy or default of the issuer of the Municipal Bonds held in the TOB Trust, a substantial downgrade","page_number":90,"box":{"x":70,"y":355,"width":836,"height":11}},{"id":"a434057b-65a6-4314-a80c-f1df08b3f671","block_type":"box","text":"in the credit quality of the issuer of the Municipal Bonds held in the TOB Trust, failure of any scheduled payment of","page_number":90,"box":{"x":70,"y":370,"width":819,"height":11}},{"id":"711cf511-65c9-497b-9736-de4b03a15b68","block_type":"box","text":"principal or interest on the Municipal Bonds, and a judgment or ruling that interest on the Municipal Bonds is subject","page_number":90,"box":{"x":70,"y":385,"width":833,"height":11}},{"id":"372d4450-a750-4ee9-9ddf-d84c77484e6c","block_type":"box","text":"to U.S. federal income taxation. MTEs may include, among other things, a failed remarketing of the TOB Floaters, the","page_number":90,"box":{"x":68,"y":400,"width":834,"height":11}},{"id":"84a8dc23-236f-4200-ab42-de3b10c9794f","block_type":"box","text":"inability of the TOB Trust to obtain renewal of the liquidity suppor t agreement, and a substantial decline in the market","page_number":90,"box":{"x":70,"y":415,"width":838,"height":11}},{"id":"3e663cc4-1909-4f69-9e44-7d089c5f7216","block_type":"box","text":"value of the Municipal Bonds held in the TOB Trust. Upon the occurrence of a TOTE or an MTE, a TOB Trust would be","page_number":90,"box":{"x":68,"y":430,"width":831,"height":11}},{"id":"bc40081e-a9ac-4c0e-a352-d87544c7b852","block_type":"box","text":"liquidated with the proceeds applied first to any accrued fees owed to the trustee of the TOB Trust, the remarketing","page_number":90,"box":{"x":70,"y":445,"width":823,"height":12}},{"id":"f0983e6a-bebf-4e48-997c-faa9bf0ea957","block_type":"box","text":"agent of the TOB Floaters and the Liquidity Provider (defined below). In the case of an MTE, after the payment of fees,","page_number":90,"box":{"x":69,"y":460,"width":839,"height":12}},{"id":"01a76ca4-acc6-419f-82f3-2aa4dbab243f","block_type":"box","text":"the holders of the TOB Floaters would be paid senior to the TOB Residual holders (","page_number":90,"box":{"x":68,"y":475,"width":589,"height":12}},{"id":"6cc95bf4-7f0c-4d43-a45b-cfca32b8059c","block_type":"box","text":"i.e.","page_number":90,"box":{"x":659,"y":476,"width":21,"height":8}},{"id":"9379c6ed-6d80-4a69-a720-1bf655a468a0","block_type":"box","text":", the Fund). In contrast, in the","page_number":90,"box":{"x":682,"y":476,"width":211,"height":11}},{"id":"f1f0b955-a870-4a07-b321-915316da4fe2","block_type":"box","text":"case of a TOTE, after payment of fees, the holders of TOB Floaters and the TOB Residual holders would be paid pro","page_number":90,"box":{"x":69,"y":491,"width":822,"height":11}},{"id":"ac7d87d2-3059-43ae-a5a4-067c2d0873fe","block_type":"box","text":"rata in propor tion to the respective face values of their cer tificates.","page_number":90,"box":{"x":69,"y":506,"width":479,"height":11}},{"id":"aed90c6c-275b-4ba3-b41a-a856e02770de","block_type":"box","text":"A Fund may invest in a TOB Trust on either a non-recourse or recourse basis. TOB Trusts are typically suppor ted","page_number":90,"box":{"x":101,"y":529,"width":797,"height":11}},{"id":"eb26b29e-8dd0-4a1d-85e0-75d44f7ead4d","block_type":"box","text":"by a liquidity facility provided by a third-par ty bank or other financial institution (the “Liquidity Provider”) that allows","page_number":90,"box":{"x":69,"y":543,"width":815,"height":12}},{"id":"59599f7a-73de-4d4a-865f-c8dce562c9f3","block_type":"box","text":"the holders of the TOB Floaters to tender their TOB Floaters in exchange for payment of par plus accrued interest on","page_number":90,"box":{"x":68,"y":559,"width":828,"height":11}},{"id":"4779cb0d-6122-4113-86e4-a795af70fcf8","block_type":"box","text":"any business day (subject to the non-occurrence of a TOTE described above). Depending on the structure of the TOB","page_number":90,"box":{"x":69,"y":574,"width":828,"height":11}},{"id":"3de18287-0072-45d2-a6c0-ae43387eb1d6","block_type":"box","text":"Trust, the Liquidity Provider may purchase the tendered TOB Floaters, or the TOB Trust may draw upon a loan from","page_number":90,"box":{"x":68,"y":589,"width":815,"height":11}},{"id":"786e7d17-5f74-4744-99b2-503ed51173a7","block_type":"box","text":"the Liquidity Provider to purchase the tendered TOB Floaters.","page_number":90,"box":{"x":68,"y":604,"width":434,"height":11}},{"id":"283f81f4-dbce-4e70-9e64-ed7e74d2d04c","block_type":"box","text":"When a Fund invests in TOB Trusts on a non-recourse basis, and the Liquidity Provider is required to make a","page_number":90,"box":{"x":101,"y":627,"width":772,"height":11}},{"id":"028b09fa-ee26-40c8-91fc-571a53e919da","block_type":"box","text":"payment under the liquidity facility, the Liquidity Provider will typically liquidate all or a por tion of the Municipal Bonds","page_number":90,"box":{"x":70,"y":642,"width":831,"height":11}},{"id":"74e5048c-a3e1-45b1-aea4-07cba5cd3991","block_type":"box","text":"held in the TOB Trust and then fund the balance, if any, of the amount owed under the liquidity facility over the","page_number":90,"box":{"x":69,"y":657,"width":785,"height":11}},{"id":"512918b5-4205-4dd3-8157-f30960d13acb","block_type":"box","text":"liquidation proceeds (the “Liquidation Shor tfall”). If a Fund invests in a TOB Trust on a recourse basis, it will typically","page_number":90,"box":{"x":70,"y":672,"width":831,"height":11}},{"id":"993735d0-dfd3-4720-ab45-8f15736cd730","block_type":"box","text":"enter into a reimbursement agreement with the Liquidity Provider pursuant to which the Fund is required to reimburse","page_number":90,"box":{"x":69,"y":687,"width":836,"height":11}},{"id":"96868137-b675-4571-bb7b-332bd4b03467","block_type":"box","text":"the Liquidity Provider the amount of any Liquidation Shor tfall. As a result, if the Fund invests in a recourse TOB Trust,","page_number":90,"box":{"x":68,"y":702,"width":836,"height":11}},{"id":"75fca7db-1380-402a-a011-d1502238bc8f","block_type":"box","text":"the Fund will bear the risk of loss with respect to any Liquidation Shor tfall. If multiple BlackRock-advised funds","page_number":90,"box":{"x":68,"y":717,"width":788,"height":12}},{"id":"96776c8a-6aa3-4a3c-8f8a-77e8bf6a6b5f","block_type":"box","text":"par ticipate in any such TOB Trust, these losses will be shared ratably, in propor tion to their par ticipation in the TOB","page_number":90,"box":{"x":70,"y":733,"width":823,"height":11}},{"id":"bc479451-03d8-4567-81dc-dbdfb7e04805","block_type":"box","text":"Trust.","page_number":90,"box":{"x":68,"y":748,"width":39,"height":9}},{"id":"725af279-572c-46fe-9144-336db364493c","block_type":"box","text":"Under accounting rules, Municipal Bonds of a Fund that are deposited into a TOB Trust are investments of the","page_number":90,"box":{"x":102,"y":770,"width":784,"height":12}},{"id":"afdd515a-f65d-4ea6-81e3-4a1326c0e23b","block_type":"box","text":"Fund and are presented on the Fund’s Schedule of Investments and outstanding TOB Floaters issued by a TOB Trust","page_number":90,"box":{"x":70,"y":785,"width":830,"height":12}},{"id":"c62b409d-c72a-42f6-bf06-a60969ba4304","block_type":"box","text":"are presented as liabilities in the Fund’s Statement of Assets and Liabilities. Interest income from the underlying","page_number":90,"box":{"x":69,"y":801,"width":806,"height":11}},{"id":"f09dc553-b855-41cd-9bee-256bb40b7b74","block_type":"box","text":"Municipal Bonds is recorded by a Fund on an accrual basis. Interest expense incurred on the TOB Floaters and other","page_number":90,"box":{"x":70,"y":816,"width":831,"height":11}},{"id":"acbd8829-020f-4cd8-bc96-c69ed7fd43ae","block_type":"box","text":"expenses related to remarketing, administration, trustee and other services to a TOB Trust are repor ted as expenses","page_number":90,"box":{"x":69,"y":831,"width":837,"height":11}},{"id":"95f2c707-492e-43a8-b862-ff6422f5c2ec","block_type":"box","text":"of a Fund. In addition, under accounting rules, loans made to a TOB Trust sponsored by a Fund may be presented as","page_number":90,"box":{"x":69,"y":846,"width":832,"height":11}},{"id":"200f8bc7-3d4e-486d-8e06-0ae26d39896b","block_type":"box","text":"loans of the Fund in the Fund’s financial statements even if there is no recourse to the Fund’s assets.","page_number":90,"box":{"x":70,"y":861,"width":728,"height":9}},{"id":"a9853432-f04a-488c-92cf-e9605ecf1ee3","block_type":"box","text":"For TOB Floaters, generally, the interest rate earned will be based upon the market rates for Municipal Bonds","page_number":90,"box":{"x":102,"y":884,"width":776,"height":11}},{"id":"cebb6b60-9bdf-412a-9203-63fda889ae47","block_type":"box","text":"with maturities or remarketing provisions that are comparable in duration to the periodic interval of the tender option.","page_number":90,"box":{"x":68,"y":899,"width":837,"height":11}},{"id":"246ecd63-3e69-4222-9776-4e8de26431a7","block_type":"box","text":"II-59","page_number":90,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"0931b984-0dd5-4aaf-b1a6-a0b9cde1496f","block_type":"box","text":"NM1026U-5982568-90/232","page_number":90,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"e8c037c5-ea62-4431-aee2-d869f8e87dce","block_type":"box","text":"Since the tender option feature has a shor ter term than the final maturity or first call date of the underlying Municipal","page_number":91,"box":{"x":69,"y":45,"width":836,"height":11}},{"id":"d6edab20-1e69-4af9-a97a-87a2f4816186","block_type":"box","text":"Bonds deposited in the TOB Trust, the holder of the TOB Floaters relies upon the terms of the agreement with the","page_number":91,"box":{"x":70,"y":60,"width":809,"height":11}},{"id":"72d52244-af38-4ea7-a04c-1bb845fda78c","block_type":"box","text":"financial institution furnishing the liquidity facility as well as the credit strength of that institution. The risk associated","page_number":91,"box":{"x":68,"y":75,"width":836,"height":11}},{"id":"d2c136bd-752e-40c7-bdd0-d7cf68cc6b03","block_type":"box","text":"with TOB Floaters, however, may be increased in the current market environment as a result of recent downgrades to","page_number":91,"box":{"x":68,"y":90,"width":835,"height":11}},{"id":"bbb83aa5-72fc-4fb8-90da-d6a5ed690c85","block_type":"box","text":"the credit ratings, and thus the perceived reliability and creditwor thiness, of many major financial institutions, some","page_number":91,"box":{"x":68,"y":105,"width":827,"height":11}},{"id":"acc2523d-d6c1-4ed2-ac53-2484c5d238a4","block_type":"box","text":"of which sponsor and/or provide liquidity suppor t to TOB Trusts. This in turn may reduce the desirability of TOB","page_number":91,"box":{"x":69,"y":120,"width":790,"height":11}},{"id":"a885ae3b-4a50-4101-840b-a3d907d5b81c","block_type":"box","text":"Floaters as investments, which could impair the viability or availability of TOB Trusts.","page_number":91,"box":{"x":70,"y":135,"width":599,"height":11}},{"id":"2abb64ed-2a6e-496a-b0be-cb7ea2b21f39","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into TOB Trust transactions, reverse","page_number":91,"box":{"x":102,"y":158,"width":762,"height":11}},{"id":"4512402e-5d3d-4ef8-9e5e-23ba87da2201","block_type":"box","text":"repurchase agreements and similar financing transactions (e.g., borrowed bonds) notwithstanding the limitation on","page_number":91,"box":{"x":69,"y":173,"width":818,"height":11}},{"id":"d646733d-0654-446a-acf9-39171e7ae8d6","block_type":"box","text":"the issuance of senior securities in Section 18 of the Investment Company Act, provided that the Fund either","page_number":91,"box":{"x":68,"y":188,"width":778,"height":11}},{"id":"97dfe7c3-03d2-4080-baa8-54afc3696de2","block_type":"box","text":"(i) complies with the 300% asset coverage ratio with respect to such transactions and any other borrowings in the","page_number":91,"box":{"x":69,"y":203,"width":811,"height":12}},{"id":"ce631002-ef10-4915-abf6-ea9b4c95bd14","block_type":"box","text":"aggregate, or (ii) treats such transactions as Derivatives Transactions under Rule 18f-4. See “—Derivatives —","page_number":91,"box":{"x":69,"y":218,"width":786,"height":12}},{"id":"a39e0bbd-4eb2-4955-af5e-141bca97565e","block_type":"box","text":"Regulation of Derivatives — Rule 18f-4 under the Investment Company Act” above.","page_number":91,"box":{"x":70,"y":234,"width":588,"height":11}},{"id":"8b68cf09-7615-4697-a935-c93cf29bba0e","block_type":"box","text":"Developments in the TOB Trust Market.","page_number":91,"box":{"x":102,"y":256,"width":279,"height":11}},{"id":"04a49d4f-6160-4107-8c1a-05be487deffc","block_type":"box","text":"In response to the restrictions imposed by section 619 of the Dodd-Frank Wall Street Reform and Consumer","page_number":91,"box":{"x":102,"y":279,"width":771,"height":11}},{"id":"3479d068-2218-4a17-9b17-40684a172ada","block_type":"box","text":"Protection Act (the “Volcker Rule”), market par ticipants have developed a structure for TOB Trusts designed to","page_number":91,"box":{"x":69,"y":294,"width":786,"height":11}},{"id":"4b5f1f70-306c-45b7-952a-3af71ef585ac","block_type":"box","text":"ensure that no banking entity is sponsoring the TOB Trust for purposes of the Volcker Rule. Specifically, a Fund will","page_number":91,"box":{"x":69,"y":309,"width":816,"height":11}},{"id":"2579ee51-c8a3-4b9a-819a-5af6d5ea564f","block_type":"box","text":"establish, structure and “sponsor” the TOB Trusts in which it holds TOB Residuals. In such a structure, cer tain","page_number":91,"box":{"x":69,"y":324,"width":791,"height":11}},{"id":"4c91fbe2-2e88-43cd-a06e-b34190fe7e7f","block_type":"box","text":"responsibilities that previously belonged to the sponsor bank will be per formed by, or on behalf of, a Fund. A Fund","page_number":91,"box":{"x":69,"y":339,"width":812,"height":12}},{"id":"f7e6a04f-a110-41e6-abb3-d609c5498d91","block_type":"box","text":"may utilize service providers in meeting these responsibilities. It is possible that regulators could take positions that","page_number":91,"box":{"x":69,"y":355,"width":832,"height":11}},{"id":"4d669312-5f4c-4b43-8382-07e65ec99cd2","block_type":"box","text":"could limit the market for such structured TOB Trust transactions or a Fund’s ability to hold TOB Residuals. Under","page_number":91,"box":{"x":69,"y":370,"width":810,"height":11}},{"id":"b0edca56-0a3c-4d4a-9126-d4b4bbec7de2","block_type":"box","text":"this TOB Trust structure, a Fund has cer tain additional duties and responsibilities, which may give rise to cer tain","page_number":91,"box":{"x":68,"y":385,"width":803,"height":11}},{"id":"432478fd-8dbb-4550-a6db-32688b7fe86b","block_type":"box","text":"additional risks including, but not limited to, compliance, securities law and operational risks.","page_number":91,"box":{"x":69,"y":400,"width":665,"height":11}},{"id":"0ca1d590-7cb9-401a-a7b5-52990421a8bd","block_type":"box","text":"Under this structure, service providers to a TOB Trust, such as administrators, liquidity providers, trustees, and","page_number":91,"box":{"x":102,"y":423,"width":793,"height":11}},{"id":"6cbb73f4-c9b4-4181-b9fc-4273f06c1110","block_type":"box","text":"remarketing agents, act at the direction of, and as agent of, a Fund as the TOB Residual holder. Similar to the","page_number":91,"box":{"x":69,"y":438,"width":783,"height":11}},{"id":"d175c4b4-c1eb-445e-9420-ff64cb28d6ce","block_type":"box","text":"traditional tender option bond structure, a Fund deposits Municipal Bonds into the TOB Trust in exchange for TOB","page_number":91,"box":{"x":68,"y":453,"width":808,"height":11}},{"id":"515516c3-1ba8-49a2-8403-b2324f73505c","block_type":"box","text":"Residuals, the TOB Trust then issues and sells TOB Floaters to third-par ty investors, and the proceeds of the sale of","page_number":91,"box":{"x":70,"y":468,"width":830,"height":11}},{"id":"18a50e46-a428-4e13-ac52-f50cbed5c8d2","block_type":"box","text":"the TOB Floaters is distributed to such TOB Residual holders (","page_number":91,"box":{"x":68,"y":483,"width":442,"height":11}},{"id":"d3c8e862-7feb-472b-b902-62ad0ee7f1dc","block_type":"box","text":"i.e.","page_number":91,"box":{"x":512,"y":483,"width":20,"height":9}},{"id":"dd71cfe3-778e-4401-b6d5-794e143bd606","block_type":"box","text":", the Fund). Tendered TOB Floaters continue to be","page_number":91,"box":{"x":535,"y":483,"width":352,"height":11}},{"id":"c51db22c-97cd-40ba-ab36-c1e74d8af196","block_type":"box","text":"suppor ted by a remarketing agent and a liquidity facility. However, the remarketing agent does not purchase tendered","page_number":91,"box":{"x":69,"y":498,"width":836,"height":11}},{"id":"2beae194-668a-494c-ab00-edd6a1b7d477","block_type":"box","text":"TOB Floaters for its own account in the event of a failed remarketing, which may increase the likelihood that a TOB","page_number":91,"box":{"x":68,"y":513,"width":816,"height":12}},{"id":"149f903e-8c1d-456c-b464-657973ad684a","block_type":"box","text":"Trust will need to be collapsed and liquidated in order to purchase the tendered TOB Floaters. In the event of a failed","page_number":91,"box":{"x":68,"y":528,"width":835,"height":11}},{"id":"b160c503-a0f7-4c0b-859a-720b8eca9659","block_type":"box","text":"remarketing of TOB Floaters, the Liquidity Provider, at its option, may advance a loan to the TOB Trust the proceeds","page_number":91,"box":{"x":69,"y":543,"width":822,"height":12}},{"id":"16a6c917-7fcc-4cb1-8061-a8560a321e81","block_type":"box","text":"of which would be used by the TOB Trust to purchase the tendered TOB Floaters. The Liquidity Provider is not","page_number":91,"box":{"x":69,"y":559,"width":777,"height":11}},{"id":"e03488e0-cc0f-451e-97f1-afa546eadaaf","block_type":"box","text":"obligated to advance such a loan. The TOB Trust would be the borrower with respect to any such loan. Any loans","page_number":91,"box":{"x":69,"y":574,"width":800,"height":11}},{"id":"cd7cfd86-70bf-46bc-9240-86ea13350351","block_type":"box","text":"made by a Liquidity Provider will be secured by the purchased TOB Floaters held by the TOB Trust.","page_number":91,"box":{"x":69,"y":589,"width":696,"height":11}},{"id":"7ac7f121-8408-41b0-b839-bb846279a2f1","block_type":"box","text":"Similar to the traditional structure for TOB Trusts, a Fund may hold either non-recourse TOB Residuals or","page_number":91,"box":{"x":102,"y":612,"width":745,"height":11}},{"id":"26ac0035-fd32-4d1f-9bd4-ba9eb6f8307b","block_type":"box","text":"recourse TOB Residuals under this structure. In the event of a Liquidation Shor tfall, there would generally be no","page_number":91,"box":{"x":69,"y":627,"width":797,"height":11}},{"id":"5d004e2a-5df9-4ee3-bda4-3d61e6c30aab","block_type":"box","text":"contractual recourse to the Fund’s assets if the Fund holds a non-recourse TOB Residual. However, as described","page_number":91,"box":{"x":69,"y":642,"width":803,"height":10}},{"id":"2709c268-1f9a-48ba-9d91-bc4c81e412eb","block_type":"box","text":"above, a Fund would bear the risk of loss with respect to any Liquidation Shor tfall if it holds a recourse TOB Residual.","page_number":91,"box":{"x":69,"y":657,"width":838,"height":11}},{"id":"07d72887-d43e-4cd9-95b1-85e5bec21281","block_type":"box","text":"The SEC and various federal banking and housing agencies adopted credit risk retention rules for securitizations","page_number":91,"box":{"x":101,"y":680,"width":801,"height":11}},{"id":"8bf2a349-fd65-4180-ab10-22754031dff6","block_type":"box","text":"(the “Risk Retention Rules”), which took effect in December 2016. The Risk Retention Rules require the sponsor of a","page_number":91,"box":{"x":69,"y":695,"width":838,"height":11}},{"id":"01792596-da4c-4fb6-ae4c-808615ec4ecc","block_type":"box","text":"TOB Trust to retain at least 5% of the credit risk of the underlying assets suppor ting the TOB Trust’s Municipal","page_number":91,"box":{"x":68,"y":710,"width":787,"height":11}},{"id":"3629d932-7e3f-454c-8900-06368cbcd4d6","block_type":"box","text":"Bonds. The Risk Retention Rules may adversely affect the Fund’s ability to engage in TOB Trust transactions or","page_number":91,"box":{"x":70,"y":725,"width":791,"height":11}},{"id":"4f139891-da38-4762-9dc1-3a5c0bdb35cb","block_type":"box","text":"increase the costs of such transactions in cer tain circumstances.","page_number":91,"box":{"x":70,"y":740,"width":466,"height":9}},{"id":"d8e0da05-d180-4b39-9c59-0a4fbb69b69b","block_type":"box","text":"TOB Trust transactions constitute an impor tant component of the municipal bond market. Accordingly,","page_number":91,"box":{"x":101,"y":763,"width":726,"height":11}},{"id":"46d53919-eaa5-435a-8cdc-894e7d78c63c","block_type":"box","text":"implementation of the Volcker Rule may adversely impact the municipal market, including through reduced demand","page_number":91,"box":{"x":70,"y":778,"width":816,"height":11}},{"id":"0fc19f15-9e3a-4751-8657-5ad92364f35d","block_type":"box","text":"for and liquidity of municipal bonds and increased financing costs for municipal issuers. Any such developments","page_number":91,"box":{"x":68,"y":793,"width":799,"height":11}},{"id":"f3203ec8-3c86-4316-b051-660ef29c2190","block_type":"box","text":"could adversely affect the Funds. The ultimate impact of these rules on the TOB market and the overall municipal","page_number":91,"box":{"x":69,"y":808,"width":807,"height":11}},{"id":"8b83b79a-71d4-4f56-95ba-922daae86d12","block_type":"box","text":"market is not yet cer tain.","page_number":91,"box":{"x":69,"y":823,"width":178,"height":11}},{"id":"df9b9a1b-eaba-4ec4-81e3-d1b52c7a70ea","block_type":"box","text":"Yields.","page_number":91,"box":{"x":103,"y":846,"width":45,"height":9}},{"id":"b0f600d8-e863-4deb-aa03-d4df715784a5","block_type":"box","text":"Yields on Municipal Bonds are dependent on a variety of factors, including the general condition of the","page_number":91,"box":{"x":154,"y":846,"width":730,"height":11}},{"id":"db149650-64a3-4c98-b5d6-cdc8c560c62d","block_type":"box","text":"money market and of the municipal bond market, the size of a par ticular offering, the financial condition of the","page_number":91,"box":{"x":69,"y":861,"width":788,"height":11}},{"id":"1bcb24e0-d1d4-4708-b3f4-12c5c09fed90","block_type":"box","text":"issuer, the maturity of the obligation and the rating of the issue. The ability of a Fund to achieve its investment","page_number":91,"box":{"x":70,"y":876,"width":787,"height":11}},{"id":"0bc70e07-7580-46f5-b623-96777446b8cf","block_type":"box","text":"objective is also dependent on the continuing ability of the issuers of the securities in which the Fund invests to meet","page_number":91,"box":{"x":69,"y":891,"width":838,"height":12}},{"id":"ee486785-13ca-448e-9985-2d5a06862192","block_type":"box","text":"their obligations for the payment of interest and principal when due. There are variations in the risks involved in","page_number":91,"box":{"x":68,"y":906,"width":794,"height":12}},{"id":"f76d8ec4-924e-4e83-bdf9-902118cd24d4","block_type":"box","text":"II-60","page_number":91,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"faf6765b-35bf-4020-bba9-3c0a1fe293d3","block_type":"box","text":"NM1026U-5982568-91/232","page_number":91,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"200b8ca3-fae2-4ade-88fa-7ed8059593c5","block_type":"box","text":"holding Municipal Bonds, both within a par ticular classification and between classifications, depending on numerous","page_number":92,"box":{"x":69,"y":45,"width":831,"height":11}},{"id":"8ceb51d1-615f-4225-bf03-3caa2e32beca","block_type":"box","text":"factors. Fur thermore, the rights of owners of Municipal Bonds and the obligations of the issuer of such Municipal","page_number":92,"box":{"x":68,"y":60,"width":806,"height":11}},{"id":"92116591-920c-4214-8b26-42e5eeec9266","block_type":"box","text":"Bonds may be subject to applicable bankruptcy, insolvency and similar laws and cour t decisions affecting the rights","page_number":92,"box":{"x":70,"y":75,"width":823,"height":11}},{"id":"8c357384-0629-4245-8e53-f1963a3eb1b0","block_type":"box","text":"of creditors generally and to general equitable principles, which may limit the enforcement of cer tain remedies.","page_number":92,"box":{"x":69,"y":90,"width":790,"height":11}},{"id":"9456f264-c1d4-48a0-8c98-be9835145277","block_type":"box","text":"Variable Rate Demand Obligations (“VRDOs”).","page_number":92,"box":{"x":103,"y":113,"width":323,"height":11}},{"id":"f35a707b-b9cd-4aeb-9c7c-1cb1f1f46acf","block_type":"box","text":"VRDOs are tax-exempt obligations that contain a floating or","page_number":92,"box":{"x":432,"y":113,"width":422,"height":11}},{"id":"074d992f-c69d-4b93-b327-441d2dc4e19e","block_type":"box","text":"variable interest rate adjustment formula and a right of demand on the par t of the holder thereof to receive payment","page_number":92,"box":{"x":68,"y":128,"width":830,"height":11}},{"id":"b010cf3d-7d67-4479-9699-573e7edb9553","block_type":"box","text":"of the unpaid principal balance plus accrued interest upon a shor t notice period not to exceed seven days.","page_number":92,"box":{"x":69,"y":143,"width":759,"height":11}},{"id":"dd7c6ea6-0b5d-4f04-8abf-6fe19b3ff89e","block_type":"box","text":"There is the possibility that because of default or insolvency the demand feature of VRDOs may not be honored.","page_number":92,"box":{"x":101,"y":166,"width":798,"height":11}},{"id":"fd5c4774-30a7-4c6c-a708-6310f4a9cda5","block_type":"box","text":"The interest rates are adjustable at periodic intervals to some prevailing market rate for similar investments, such","page_number":92,"box":{"x":68,"y":181,"width":815,"height":11}},{"id":"2fdfaf37-9e8a-449c-9741-cae361868127","block_type":"box","text":"adjustment formula being calculated to maintain the market rate of the VRDOs at approximately the par value of the","page_number":92,"box":{"x":69,"y":196,"width":826,"height":11}},{"id":"41a959e3-4c50-4599-b550-19164a48e828","block_type":"box","text":"VRDOs on the adjustment date. The adjustments typically are based upon the Securities Industry and Financial","page_number":92,"box":{"x":68,"y":211,"width":791,"height":11}},{"id":"bce915f2-1958-43b7-8435-66cb660e95f6","block_type":"box","text":"Markets Association (“SIFMA”) Index.","page_number":92,"box":{"x":70,"y":226,"width":264,"height":11}},{"id":"1f77dad8-c0ee-4837-a31f-5df31ad5f27c","block_type":"box","text":"Because of the interest rate adjustment formula on VRDOs, VRDOs are not comparable to fixed rate securities.","page_number":92,"box":{"x":102,"y":249,"width":791,"height":11}},{"id":"65247e79-b10e-4fff-ad2f-d2efff878554","block_type":"box","text":"During periods of declining interest rates, a Fund’s yield on a VRDO will decrease and its shareholders will forego the","page_number":92,"box":{"x":70,"y":264,"width":833,"height":11}},{"id":"fd57f296-63f9-4960-8432-0b8612edf8ca","block_type":"box","text":"oppor tunity for capital appreciation. During periods of rising interest rates, however, a Fund’s yield on a VRDO will","page_number":92,"box":{"x":69,"y":279,"width":808,"height":11}},{"id":"bcb00860-e936-4a2b-b0cc-831f0d558a6b","block_type":"box","text":"increase and the Fund’s shareholders will have a reduced risk of capital depreciation.","page_number":92,"box":{"x":70,"y":294,"width":608,"height":11}},{"id":"2f60ca32-49fc-4325-b984-3a8ad4311dd5","block_type":"box","text":"Transactions in Financial Futures Contracts on Municipal Indexes.","page_number":92,"box":{"x":103,"y":317,"width":465,"height":11}},{"id":"55526b7f-9d52-478e-a9a3-0088da2650e5","block_type":"box","text":"The Municipal Funds and cer tain other funds","page_number":92,"box":{"x":574,"y":317,"width":318,"height":11}},{"id":"5dc66603-05e6-4e37-8396-e15238862a11","block_type":"box","text":"deal in financial futures contracts based on a long-term municipal bond index developed by the Chicago Board of","page_number":92,"box":{"x":69,"y":332,"width":803,"height":11}},{"id":"9339d5b5-7edb-46b3-8741-d9fe3291a2cd","block_type":"box","text":"Trade (“CBT”) and The Bond Buyer (the “Municipal Bond Index”). The Municipal Bond Index is comprised of 40 long","page_number":92,"box":{"x":68,"y":347,"width":825,"height":11}},{"id":"0dd0d44e-bfe3-4c1d-89b3-86ca39f14c32","block_type":"box","text":"term, actively traded tax-exempt municipal revenue and general obligation bonds. Each bond included in the Municipal","page_number":92,"box":{"x":68,"y":362,"width":840,"height":11}},{"id":"3ef21d96-1c59-43e1-accd-388c009456de","block_type":"box","text":"Bond Index must be rated A or higher by Moody’s or S&P and must have a remaining maturity of 19 years or more.","page_number":92,"box":{"x":70,"y":377,"width":815,"height":12}},{"id":"e8b32f10-b26d-4088-b3ae-4aba80fcbfed","block_type":"box","text":"Twice a month new issues satisfying the eligibility requirements are added to, and an equal number of old issues are","page_number":92,"box":{"x":68,"y":392,"width":836,"height":12}},{"id":"2806c593-3ef2-4350-8f2a-35eab5607ddc","block_type":"box","text":"deleted from, the Municipal Bond Index. The value of the Municipal Bond Index is computed daily according to a","page_number":92,"box":{"x":69,"y":407,"width":796,"height":12}},{"id":"8dcc73c4-7f80-4c91-bf1c-27ccdd281614","block_type":"box","text":"formula based on the price of each bond in the Municipal Bond Index, as evaluated by six dealer-to-dealer brokers.","page_number":92,"box":{"x":68,"y":423,"width":816,"height":11}},{"id":"bb62e359-1011-4a52-a148-0eb460ec4dc7","block_type":"box","text":"The Municipal Bond Index futures contract is traded only on the CBT. Like other contract markets, the CBT","page_number":92,"box":{"x":101,"y":445,"width":756,"height":11}},{"id":"b32c00ed-c9c1-4de1-8411-876eeddbf07a","block_type":"box","text":"assures per formance under futures contracts through a clearing corporation, a nonprofit organization managed by the","page_number":92,"box":{"x":69,"y":460,"width":839,"height":12}},{"id":"9c91f7cf-f875-43db-b481-d34cd35d436f","block_type":"box","text":"exchange membership that is also responsible for handling daily accounting of deposits or withdrawals of margin.","page_number":92,"box":{"x":69,"y":475,"width":808,"height":12}},{"id":"66d8639c-8a6a-4f49-af6d-41b7a0e74c90","block_type":"box","text":"The par ticular municipal bonds comprising the index underlying the Municipal Bond Index financial futures","page_number":92,"box":{"x":101,"y":498,"width":753,"height":11}},{"id":"0279e2c5-f394-40f3-a864-babe4d91ae86","block_type":"box","text":"contract may vary from the bonds held by a Municipal Fund. As a result, a Municipal Fund’s ability to hedge","page_number":92,"box":{"x":69,"y":513,"width":764,"height":12}},{"id":"5feb6c1b-5db9-4643-bbd5-20608b262488","block_type":"box","text":"effectively all or a por tion of the value of its Municipal Bonds through the use of such financial futures contracts will","page_number":92,"box":{"x":69,"y":528,"width":826,"height":12}},{"id":"9fcd83d3-b0bb-48e1-97ea-9c2d674e2ba6","block_type":"box","text":"depend in par t on the degree to which price movements in the index underlying the financial futures contract","page_number":92,"box":{"x":69,"y":543,"width":774,"height":12}},{"id":"3c76a42c-91fe-47b4-b74c-5b1a500e2d06","block_type":"box","text":"correlate with the price movements of the Municipal Bonds held by the Fund. The correlation may be affected by","page_number":92,"box":{"x":69,"y":559,"width":801,"height":11}},{"id":"8513a269-aa85-461e-9f78-d60209bf3608","block_type":"box","text":"disparities in the average maturity, ratings, geographical mix or structure of a Municipal Fund’s investments as","page_number":92,"box":{"x":69,"y":574,"width":788,"height":11}},{"id":"2a889546-1a21-42fa-8a94-6c397dba6cd1","block_type":"box","text":"compared to those comprising the Municipal Bond Index and general economic or political factors. In addition, the","page_number":92,"box":{"x":69,"y":589,"width":812,"height":11}},{"id":"436e21bb-17bc-4247-9077-898f5193cce8","block_type":"box","text":"correlation between movements in the value of the Municipal Bond Index may be subject to change over time as","page_number":92,"box":{"x":69,"y":604,"width":799,"height":11}},{"id":"3ace7ad4-08ac-41c9-b8ad-9c902f289136","block_type":"box","text":"additions to and deletions from the Municipal Bond Index alter its structure. The correlation between futures","page_number":92,"box":{"x":69,"y":619,"width":772,"height":11}},{"id":"814347cc-2453-4e62-9db4-ef4071e7492d","block_type":"box","text":"contracts on U.S. Government Securities and the Municipal Bonds held by a Municipal Fund may be adversely","page_number":92,"box":{"x":69,"y":634,"width":782,"height":11}},{"id":"4d95fa40-fe54-470d-ad73-23a412f92df2","block_type":"box","text":"affected by similar factors and the risk of imper fect correlation between movements in the prices of such futures","page_number":92,"box":{"x":69,"y":649,"width":806,"height":12}},{"id":"f3db0fdc-fb7f-4550-8385-446796abb2bb","block_type":"box","text":"contracts and the prices of Municipal Bonds held by a Municipal Fund may be greater. Municipal Bond Index futures","page_number":92,"box":{"x":69,"y":664,"width":823,"height":12}},{"id":"83d554c6-c2e8-4d13-a9c7-3d2977b59c3a","block_type":"box","text":"contracts were approved for trading in 1985. Trading in such futures contracts may tend to be less liquid than trading","page_number":92,"box":{"x":69,"y":680,"width":837,"height":11}},{"id":"7e5db425-f48b-436e-83b8-0aa3d7578a75","block_type":"box","text":"in other futures contracts. The trading of futures contracts also is subject to cer tain market risks, such as inadequate","page_number":92,"box":{"x":70,"y":695,"width":839,"height":11}},{"id":"be928094-5bc0-4197-a8fb-cef75a671d04","block_type":"box","text":"trading activity, which could at times make it difficult or impossible to liquidate existing positions.","page_number":92,"box":{"x":68,"y":710,"width":693,"height":11}},{"id":"2146aeed-b3f0-4dbc-be09-3f6a7aa43b79","block_type":"box","text":"Call Rights.","page_number":92,"box":{"x":102,"y":733,"width":79,"height":11}},{"id":"00d005ac-1e66-437e-95fc-34024b8fe0bd","block_type":"box","text":"A Fund may purchase a Municipal Bond issuer’s right to call all or a por tion of such Municipal Bond","page_number":92,"box":{"x":187,"y":732,"width":708,"height":12}},{"id":"aaf96503-e6d0-4585-bbbe-b3cc90911b6c","block_type":"box","text":"for mandatory tender for purchase (a “Call Right”). A holder of a Call Right may exercise such right to require a","page_number":92,"box":{"x":68,"y":748,"width":790,"height":11}},{"id":"dffbf214-6af9-4973-80e0-452f67560f6e","block_type":"box","text":"mandatory tender for the purchase of related Municipal Bonds, subject to cer tain conditions. A Call Right that is not","page_number":92,"box":{"x":69,"y":763,"width":827,"height":11}},{"id":"93ee0246-44a2-46a8-84b9-26fa0d27e7d9","block_type":"box","text":"exercised prior to maturity of the related Municipal Bond will expire without value. The economic effect of holding","page_number":92,"box":{"x":69,"y":778,"width":805,"height":11}},{"id":"9f2b651a-5d37-4e71-8891-aa543fa3f013","block_type":"box","text":"both the Call Right and the related Municipal Bond is identical to holding a Municipal Bond as a non-callable security.","page_number":92,"box":{"x":69,"y":793,"width":833,"height":11}},{"id":"84e0ed0e-3166-42f3-9182-2d01698f51ea","block_type":"box","text":"Cer tain investments in such obligations may be illiquid.","page_number":92,"box":{"x":69,"y":808,"width":393,"height":11}},{"id":"7627dad7-6e2c-4fbe-8e14-aa51550d5292","block_type":"box","text":"Municipal Interest Rate Swap Transactions.","page_number":92,"box":{"x":102,"y":831,"width":307,"height":11}},{"id":"17bf7cda-ee3f-44cf-b21e-93643526f147","block_type":"box","text":"In order to hedge the value of a Fund against interest rate","page_number":92,"box":{"x":417,"y":831,"width":411,"height":11}},{"id":"39a74fe9-d4ac-41f9-9705-8e49193563e4","block_type":"box","text":"fluctuations or to enhance a Fund’s income, a Fund may enter into interest rate swap transactions such as Municipal","page_number":92,"box":{"x":68,"y":846,"width":835,"height":11}},{"id":"62d5fbc8-cfae-49cd-8e94-b6e12ddd440e","block_type":"box","text":"Market Data AAA Cash Curve swaps (“MMD Swaps”) or Securities Industry and Financial Markets Association","page_number":92,"box":{"x":70,"y":861,"width":781,"height":11}},{"id":"1011c40f-ae5e-4f84-a76b-a5d1a46e971b","block_type":"box","text":"Municipal Swap Index swaps (“SIFMA Swaps”). To the extent that a Fund enters into these transactions, the Fund","page_number":92,"box":{"x":70,"y":876,"width":808,"height":11}},{"id":"371cadf3-eeb1-4691-b845-16670661ca0f","block_type":"box","text":"expects to do so primarily to preserve a return or spread on a par ticular investment or por tion of its por tfolio or to","page_number":92,"box":{"x":69,"y":891,"width":814,"height":11}},{"id":"dbbc917c-8dc8-4b9a-a64f-aab044027830","block_type":"box","text":"protect against any increase in the price of securities the Fund anticipates purchasing at a later date. A Fund intends","page_number":92,"box":{"x":70,"y":906,"width":832,"height":12}},{"id":"4e53e548-be98-4923-97a8-e164e3f67c7c","block_type":"box","text":"II-61","page_number":92,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"d1a7896e-94ef-4c7b-a0ea-2ac57dcbe5a3","block_type":"box","text":"NM1026U-5982568-92/232","page_number":92,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"9863eab8-968a-4819-a1fe-93162742d243","block_type":"box","text":"to use these transactions primarily as a hedge rather than as a speculative investment. However, a Fund also may","page_number":93,"box":{"x":68,"y":45,"width":817,"height":11}},{"id":"ada36780-80c8-4e97-b525-b7720a375530","block_type":"box","text":"invest in MMD Swaps and SIFMA Swaps to enhance income or gain or to increase the Fund’s yield, for example,","page_number":93,"box":{"x":70,"y":60,"width":797,"height":11}},{"id":"e643db79-4bea-4ec2-9c99-2b5b9bf8d67b","block_type":"box","text":"during periods of steep interest rate yield curves (","page_number":93,"box":{"x":69,"y":75,"width":356,"height":11}},{"id":"86ebe069-38b5-47b6-a87c-7dfd1f8a6c7c","block_type":"box","text":"i.e.","page_number":93,"box":{"x":427,"y":75,"width":20,"height":9}},{"id":"509b6e29-47dc-4a38-9a35-d90d4e74ccd2","block_type":"box","text":", wide differences between shor t-term and long-term interest","page_number":93,"box":{"x":449,"y":75,"width":433,"height":11}},{"id":"8d2def9b-ae89-418a-b5dc-d753e031c99d","block_type":"box","text":"rates).","page_number":93,"box":{"x":69,"y":90,"width":44,"height":11}},{"id":"62833682-3b37-4b94-b9a5-c9876300a184","block_type":"box","text":"A Fund may purchase and sell SIFMA Swaps in the SIFMA swap market. In a SIFMA Swap, a Fund exchanges with","page_number":93,"box":{"x":101,"y":113,"width":807,"height":11}},{"id":"6f2fb017-7cbb-4467-a4ca-fdd5d92761f0","block_type":"box","text":"another par ty their respective commitments to pay or receive interest (","page_number":93,"box":{"x":69,"y":128,"width":503,"height":11}},{"id":"0b9bb892-5374-42b3-8a81-90faa09c5aaa","block_type":"box","text":"e.g.","page_number":93,"box":{"x":574,"y":129,"width":25,"height":10}},{"id":"c9d1a159-4fe6-4a2a-b626-c270b5904473","block_type":"box","text":", an exchange of fixed rate payments for","page_number":93,"box":{"x":601,"y":128,"width":286,"height":11}},{"id":"1a6d64b6-ee78-4110-9a54-7eb77cc9b644","block_type":"box","text":"floating rate payments linked to the SIFMA Municipal Swap Index). Because the underlying index is a tax-exempt","page_number":93,"box":{"x":68,"y":143,"width":798,"height":11}},{"id":"89520ab3-d541-4e60-a3e3-f82674114ff7","block_type":"box","text":"index, SIFMA Swaps may reduce cross-market risks incurred by a Fund and increase a Fund’s ability to hedge","page_number":93,"box":{"x":70,"y":158,"width":778,"height":11}},{"id":"1aa4783a-2802-4c15-86c9-62b09833aade","block_type":"box","text":"effectively. SIFMA Swaps are typically quoted for the entire yield curve, beginning with a seven day floating rate index","page_number":93,"box":{"x":69,"y":173,"width":833,"height":11}},{"id":"af6cd7c3-98e7-4e56-b5ab-9c1b1fd17d44","block_type":"box","text":"out to 30 years. The duration of a SIFMA Swap is approximately equal to the duration of a fixed-rate Municipal Bond","page_number":93,"box":{"x":69,"y":188,"width":823,"height":11}},{"id":"a6d5f1c2-df6e-45af-b71f-1ee027bfe8e1","block_type":"box","text":"with the same attributes as the swap (","page_number":93,"box":{"x":68,"y":204,"width":275,"height":10}},{"id":"da6aac23-f27f-4789-bba3-e43706dcd188","block_type":"box","text":"e.g.","page_number":93,"box":{"x":345,"y":205,"width":24,"height":10}},{"id":"1e8bc597-4256-4e78-83cd-e1614c41646a","block_type":"box","text":", coupon, maturity, call feature).","page_number":93,"box":{"x":372,"y":203,"width":224,"height":12}},{"id":"6aa3bacc-8f28-4ddb-ab20-a57a13b93f28","block_type":"box","text":"A Fund may also purchase and sell MMD Swaps, also known as MMD rate locks. An MMD Swap permits a Fund","page_number":93,"box":{"x":101,"y":226,"width":797,"height":11}},{"id":"7b95bbb8-6add-4aad-86cb-68c837cf258b","block_type":"box","text":"to lock in a specified municipal interest rate for a por tion of its por tfolio to preserve a return on a par ticular","page_number":93,"box":{"x":68,"y":241,"width":770,"height":11}},{"id":"301cc9e4-15fc-4ffb-ab12-1d1b53c33c98","block_type":"box","text":"investment or a por tion of its por tfolio as a duration management technique or to protect against any increase in the","page_number":93,"box":{"x":70,"y":256,"width":832,"height":12}},{"id":"2e89bd3b-6364-49c8-8147-f785e2421f8e","block_type":"box","text":"price of securities to be purchased at a later date. By using an MMD Swap, a Fund can create a synthetic long or","page_number":93,"box":{"x":70,"y":271,"width":805,"height":12}},{"id":"696f890f-a091-4402-9a53-2c6be45bd48c","block_type":"box","text":"shor t position, allowing the Fund to select the most attractive par t of the yield curve. An MMD Swap is a contract","page_number":93,"box":{"x":69,"y":286,"width":808,"height":12}},{"id":"62c4f057-9570-47eb-9d30-7ad9fe1d6cc6","block_type":"box","text":"between a Fund and an MMD Swap provider pursuant to which the par ties agree to make payments to each other on","page_number":93,"box":{"x":69,"y":302,"width":832,"height":11}},{"id":"4988fb31-702c-432e-b3bf-90da173d40f7","block_type":"box","text":"a notional amount, contingent upon whether the Municipal Market Data AAA General Obligation Scale is above or","page_number":93,"box":{"x":69,"y":317,"width":804,"height":11}},{"id":"e00f5706-5f15-433a-8d4d-2bc8aa86a6d7","block_type":"box","text":"below a specified level on the expiration date of the contract. For example, if a Fund buys an MMD Swap and the","page_number":93,"box":{"x":69,"y":332,"width":803,"height":11}},{"id":"a55cb107-2a01-4b0e-ab6d-fabb84a18412","block_type":"box","text":"Municipal Market Data AAA General Obligation Scale is below the specified level on the expiration date, the","page_number":93,"box":{"x":70,"y":347,"width":763,"height":11}},{"id":"3a884ba0-7c6e-4e61-b368-443cb53d9095","block_type":"box","text":"counterpar ty to the contract will make a payment to the Fund equal to the specified level minus the actual level,","page_number":93,"box":{"x":69,"y":362,"width":797,"height":11}},{"id":"0dc780c7-56ae-4ef7-8d7d-524275fa276d","block_type":"box","text":"multiplied by the notional amount of the contract. If the Municipal Market Data AAA General Obligation Scale is above","page_number":93,"box":{"x":69,"y":377,"width":836,"height":12}},{"id":"4ada9a6c-f698-4c5d-ab9a-bd7f93d1e60b","block_type":"box","text":"the specified level on the expiration date, a Fund will make a payment to the counterpar ty equal to the actual level","page_number":93,"box":{"x":68,"y":392,"width":816,"height":12}},{"id":"7c909b34-cf57-4495-afbd-33701b11a3bc","block_type":"box","text":"minus the specified level, multiplied by the notional amount of the contract.","page_number":93,"box":{"x":69,"y":407,"width":537,"height":12}},{"id":"dda31b2e-4fab-4558-a272-f0bb41fb65f3","block_type":"box","text":"In connection with investments in SIFMA and MMD Swaps, there is a risk that municipal yields will move in the","page_number":93,"box":{"x":102,"y":430,"width":788,"height":11}},{"id":"f4771f25-1afc-4157-af49-7b490d026bfb","block_type":"box","text":"opposite direction than anticipated by a Fund, which would cause the Fund to make payments to its counterpar ty in","page_number":93,"box":{"x":69,"y":446,"width":821,"height":10}},{"id":"2d975cb8-c715-41ec-bbe3-fa0303174bdb","block_type":"box","text":"the transaction that could adversely affect the Fund’s per formance.","page_number":93,"box":{"x":68,"y":460,"width":482,"height":12}},{"id":"700f109b-e2ee-4822-9e6f-c22c1ade0196","block_type":"box","text":"Insured Municipal Bonds.","page_number":93,"box":{"x":102,"y":483,"width":179,"height":11}},{"id":"ba07a635-de8c-4056-982c-cabeab4e64f2","block_type":"box","text":"Bonds purchased by a Fund may be covered by insurance that guarantees that interest","page_number":93,"box":{"x":288,"y":483,"width":619,"height":11}},{"id":"e621f5e3-3a7a-476e-87fb-bc036db33ca8","block_type":"box","text":"payments on the bond will be made on time and the principal will be repaid when the bond matures. Either the issuer","page_number":93,"box":{"x":70,"y":498,"width":835,"height":11}},{"id":"325a8a63-eda1-4415-8a96-01a54514e7f9","block_type":"box","text":"of the bond or the Fund purchases the insurance. Insurance is expected to protect the Fund against losses caused by","page_number":93,"box":{"x":69,"y":513,"width":840,"height":12}},{"id":"ac793c54-bc0b-44b7-969b-b0596ce1bc83","block_type":"box","text":"a bond issuer’s failure to make interest or principal payments. However, insurance does not protect the Fund or its","page_number":93,"box":{"x":69,"y":528,"width":818,"height":12}},{"id":"6191d036-d2fc-4443-ab37-0645eff868d5","block_type":"box","text":"shareholders against losses caused by declines in a bond’s market value. Also, the Fund cannot be cer tain that any","page_number":93,"box":{"x":69,"y":544,"width":829,"height":11}},{"id":"aa76bf48-0ee9-4f28-826f-fa4b02966e27","block_type":"box","text":"insurance company does not make these payments. In addition, if the Fund purchases the insurance, it may pay the","page_number":93,"box":{"x":70,"y":559,"width":827,"height":11}},{"id":"43312120-bf23-4e78-93cc-151a51de4605","block_type":"box","text":"premiums, which will reduce the Fund’s yield. The Fund seeks to use only insurance companies with claims paying","page_number":93,"box":{"x":70,"y":574,"width":815,"height":11}},{"id":"5a972c72-5e19-4689-9b2a-9c4bd9e36fe0","block_type":"box","text":"ability, financial strength, or equivalent ratings of at least investment grade. However, if insurance from insurers with","page_number":93,"box":{"x":69,"y":589,"width":829,"height":11}},{"id":"c98869f9-451b-4a17-a7b9-ec4ff64fbc0e","block_type":"box","text":"these ratings is not available, the Fund may use insurance companies with lower ratings or stop purchasing","page_number":93,"box":{"x":68,"y":604,"width":767,"height":11}},{"id":"f85ef40a-5c00-47a3-b7f4-b52b1aa11fbc","block_type":"box","text":"insurance or insured bonds. If a bond’s insurer fails to fulfill its obligations or loses its credit rating, the value of the","page_number":93,"box":{"x":70,"y":619,"width":827,"height":11}},{"id":"e45064f8-5742-484b-92a1-f5d57d2369c7","block_type":"box","text":"bond could drop.","page_number":93,"box":{"x":69,"y":634,"width":118,"height":11}},{"id":"eb19964a-cced-4cbe-b1de-fe08405db13f","block_type":"box","text":"Build America Bonds.","page_number":93,"box":{"x":102,"y":657,"width":150,"height":9}},{"id":"69f8d429-9e60-4284-a64a-585ef1f0b5ca","block_type":"box","text":"If a Fund holds Build America Bonds, the Fund may be eligible to receive a U.S. federal","page_number":93,"box":{"x":259,"y":657,"width":616,"height":11}},{"id":"1774b01b-344e-46cd-91fc-3ee864b6a342","block_type":"box","text":"income tax credit; however, the issuer of a Build America Bond may instead elect to receive a cash payment directly","page_number":93,"box":{"x":70,"y":672,"width":825,"height":11}},{"id":"3c64d6a3-e720-44b5-9015-d46525adc562","block_type":"box","text":"from the federal government in lieu of holders such as the fund receiving a tax credit. The interest on Build America","page_number":93,"box":{"x":68,"y":687,"width":824,"height":11}},{"id":"cbe4bb3e-8be7-466f-b8d6-2d55c60bd0a0","block_type":"box","text":"Bonds is taxable for U.S. federal income tax purposes. If the Fund does receive tax credits from Build America Bonds","page_number":93,"box":{"x":70,"y":702,"width":833,"height":11}},{"id":"f0163a67-2736-49f2-a6b5-f3fea1e16185","block_type":"box","text":"or other tax credit bonds on one or more specified dates during the fund’s taxable year, and the Fund satisfies the","page_number":93,"box":{"x":69,"y":717,"width":815,"height":12}},{"id":"6d389490-d873-4c41-9e36-f0025ccbfb40","block_type":"box","text":"minimum distribution requirement, the Fund may elect for U.S. federal income tax purposes to pass through to","page_number":93,"box":{"x":69,"y":732,"width":788,"height":12}},{"id":"27fb2115-d2b4-40b6-b2f3-26cb4fc52659","block_type":"box","text":"shareholders tax credits otherwise allowable to the Fund for that year with respect to such bonds. A tax credit bond","page_number":93,"box":{"x":69,"y":748,"width":823,"height":11}},{"id":"c752eac8-a53d-4f55-af78-59530b3b665f","block_type":"box","text":"is defined in the Code as a “qualified tax credit bond” (which includes a qualified forestry conservation bond, a new","page_number":93,"box":{"x":70,"y":763,"width":825,"height":11}},{"id":"b8ce8a4d-68f1-4f8c-8cdf-6a2e02881ec4","block_type":"box","text":"clean renewable energy bond, a qualified energy conservation bond, or a qualified zone academy bond, each of which","page_number":93,"box":{"x":69,"y":778,"width":837,"height":11}},{"id":"7adf9a60-6928-4ca3-89b8-6676a6374a37","block_type":"box","text":"must meet cer tain requirements specified in the Code), a “Build America Bond” (which includes cer tain qualified","page_number":93,"box":{"x":69,"y":793,"width":802,"height":11}},{"id":"b0631006-0595-4576-a1e7-68ce0fb234a3","block_type":"box","text":"bonds issued before January 1, 2011) or cer tain other specified bonds. If the Fund were to so elect, a shareholder","page_number":93,"box":{"x":69,"y":808,"width":821,"height":11}},{"id":"fce68e73-c2bb-4496-b0cb-d7de039ec70a","block_type":"box","text":"would be required to include in income and would be entitled to claim as a tax credit an amount equal to a","page_number":93,"box":{"x":68,"y":823,"width":760,"height":11}},{"id":"af7cd563-bca1-4156-bb13-70223c9239a1","block_type":"box","text":"propor tionate share of such credits, and such amount would be subject to withholding provisions of the Code.","page_number":93,"box":{"x":70,"y":838,"width":782,"height":12}},{"id":"4e335063-3a92-455e-a108-45e365ca6e79","block_type":"box","text":"Cer tain limitations may apply on the extent to which the credit may be claimed.","page_number":93,"box":{"x":69,"y":854,"width":563,"height":11}},{"id":"bb0df9a7-2db4-4292-af3e-015668047786","block_type":"box","text":"Tax-Exempt Municipal Investments.","page_number":93,"box":{"x":103,"y":876,"width":246,"height":11}},{"id":"9f52cca1-787e-4ed3-9f0c-3a945b24c18e","block_type":"box","text":"Cer tain Funds may hold tax-exempt municipal investments which may be in","page_number":93,"box":{"x":355,"y":876,"width":534,"height":11}},{"id":"45215f8d-5482-41bb-8a42-3f2e7d7dba8a","block_type":"box","text":"the form of tender option bonds, variable rate demand obligations, par ticipations, beneficial interests in a trust,","page_number":93,"box":{"x":68,"y":891,"width":798,"height":12}},{"id":"60a5fc86-3aaf-4502-b854-cd1612dfda51","block_type":"box","text":"par tnership interests or other forms. These investments are described in greater detail above in this section. Some","page_number":93,"box":{"x":70,"y":906,"width":823,"height":12}},{"id":"fb0a8030-499a-4b95-911f-0e926cffcc95","block_type":"box","text":"II-62","page_number":93,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"4e631ea3-3058-4a9f-a867-88f21b52496f","block_type":"box","text":"NM1026U-5982568-93/232","page_number":93,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"9119884b-abf5-4d45-aa19-26cdefc2b435","block_type":"box","text":"of the structures used by cer tain Funds include interests in long-term fixed-rate municipal debt obligations, held by a","page_number":94,"box":{"x":69,"y":45,"width":830,"height":11}},{"id":"04c3a882-2519-4b56-9bf2-8240598fb739","block_type":"box","text":"trustee or custodian, that are coupled with tender option, demand and other features when the tax-exempt municipal","page_number":94,"box":{"x":68,"y":60,"width":832,"height":11}},{"id":"6a6f817d-9c81-475a-bb57-9f5ca1b33885","block_type":"box","text":"investments are created. Together, these features entitle the holder of the interest to tender (or put) the underlying","page_number":94,"box":{"x":70,"y":75,"width":819,"height":11}},{"id":"65765980-17be-4438-93b1-890046012ad5","block_type":"box","text":"municipal debt obligation to a third par ty at periodic intervals and to receive the principal amount thereof.","page_number":94,"box":{"x":69,"y":90,"width":752,"height":11}},{"id":"0f214f6d-000b-4b1d-b860-d9e41606e835","block_type":"box","text":"In some cases, municipal debt obligations are represented by custodial receipts evidencing rights to receive","page_number":94,"box":{"x":102,"y":113,"width":770,"height":11}},{"id":"27947297-0252-4c3f-97cc-01491186c943","block_type":"box","text":"specific future interest payments, principal payments, or both, on the underlying securities held by the custodian.","page_number":94,"box":{"x":69,"y":128,"width":806,"height":11}},{"id":"e6fc97e7-423c-4e4f-9bc4-71bc5efa8a76","block_type":"box","text":"Under such arrangements, the holder of the custodial receipt has the option to tender the underlying securities at","page_number":94,"box":{"x":70,"y":143,"width":809,"height":11}},{"id":"37b929a2-cc25-45f3-8051-f9b9223d45de","block_type":"box","text":"their face value to the sponsor (","page_number":94,"box":{"x":68,"y":158,"width":228,"height":11}},{"id":"c74e2aba-ea19-47bb-8726-43112fc0e911","block_type":"box","text":"e.g.","page_number":94,"box":{"x":297,"y":160,"width":25,"height":9}},{"id":"5fd51b9c-1372-4fb1-baab-ecd4cfc4f6d2","block_type":"box","text":", a Fund, or a bank or broker-dealer or other financial institution), which is paid","page_number":94,"box":{"x":325,"y":158,"width":557,"height":11}},{"id":"976a628c-e9f3-4c86-bd86-232c7bb8a2d0","block_type":"box","text":"periodic fees equal to the difference between the securities’ fixed coupon rate and the rate that would cause the","page_number":94,"box":{"x":70,"y":173,"width":803,"height":11}},{"id":"3d57a647-d502-4b31-95e2-fed44e07bb3a","block_type":"box","text":"securities, coupled with the tender option, to trade at par on the date of a rate adjustment.","page_number":94,"box":{"x":69,"y":188,"width":648,"height":11}},{"id":"7e637d86-3ddc-43eb-88ed-0397ec238cf5","block_type":"box","text":"A par ticipation interest gives the Fund an undivided interest in a Municipal Bond in the propor tion the Fund’s","page_number":94,"box":{"x":101,"y":211,"width":775,"height":11}},{"id":"3e8f1548-be02-443d-810e-6550e8a17a90","block_type":"box","text":"par ticipation bears to the total principal amount of the Municipal Bond, and typically provides for a repurchase","page_number":94,"box":{"x":70,"y":226,"width":785,"height":11}},{"id":"9a687970-1a72-4241-b8b6-3b6a363d8ef0","block_type":"box","text":"feature for all or any par t of the full principal amount of the par ticipation interest, plus accrued interest. Trusts and","page_number":94,"box":{"x":68,"y":241,"width":821,"height":11}},{"id":"a2f2813f-9f72-4fb6-9e69-06dd06d1747f","block_type":"box","text":"par tnerships are typically used to conver t long-term fixed rate high quality bonds of a single state or municipal issuer","page_number":94,"box":{"x":70,"y":256,"width":833,"height":12}},{"id":"d7e95244-df60-49f5-bbc5-180422191a08","block_type":"box","text":"into variable or floating rate demand instruments.","page_number":94,"box":{"x":70,"y":271,"width":351,"height":12}},{"id":"a3be6869-380f-4c98-ba50-3deb30203919","block_type":"box","text":"The Municipal Bond Funds may hold par ticipation interests and custodial receipts for municipal debt obligations","page_number":94,"box":{"x":101,"y":294,"width":797,"height":11}},{"id":"21ba11c4-5f9d-4c9e-ad8f-81692ab42648","block_type":"box","text":"which give the holder the right to receive payment of principal subject to the conditions described above. The IRS has","page_number":94,"box":{"x":68,"y":309,"width":836,"height":11}},{"id":"a20253af-d7c4-47ee-8c33-0474ba826bce","block_type":"box","text":"not ruled on whether the interest received on tax-exempt municipal investments in the form of par ticipation interests","page_number":94,"box":{"x":69,"y":324,"width":831,"height":11}},{"id":"5038b226-e41c-4dba-ab8a-f22c71021c68","block_type":"box","text":"or custodial receipts is tax-exempt, and accordingly, purchases of any such interests or receipts are based on the","page_number":94,"box":{"x":69,"y":339,"width":809,"height":12}},{"id":"4ea432f6-032a-40fd-89b2-dfb11f190bef","block_type":"box","text":"opinions of counsel to the sponsors of such derivative securities. Neither a Fund nor its investment adviser or sub","page_number":94,"box":{"x":69,"y":355,"width":818,"height":11}},{"id":"415c16d3-e41b-438d-97bb-0bea2e00cb90","block_type":"box","text":"advisers will review the proceedings related to the creation of any tax-exempt municipal investments or the basis for","page_number":94,"box":{"x":69,"y":370,"width":828,"height":11}},{"id":"9a50a669-de06-47cf-8431-c095b2d5a391","block_type":"box","text":"such opinions.","page_number":94,"box":{"x":69,"y":385,"width":102,"height":11}},{"id":"7ba63801-7f69-44d9-bdba-efe8db476c32","block_type":"box","text":"Operational and Technology Risks.","page_number":94,"box":{"x":102,"y":408,"width":250,"height":11}},{"id":"d720e8e6-aaaa-4686-b0d2-1ebde6d611a1","block_type":"box","text":"The Fund and the entities with which it interacts directly or indirectly are","page_number":94,"box":{"x":358,"y":408,"width":512,"height":11}},{"id":"288318ef-7181-4ae7-97b0-eb403753f3ad","block_type":"box","text":"susceptible to operational and technology risks, including those related to human errors, processing errors,","page_number":94,"box":{"x":69,"y":423,"width":766,"height":11}},{"id":"4abb608b-f9b7-4718-a3c9-cad74e4a766b","block_type":"box","text":"communication errors, systems failures, cybersecurity incidents, and the use of ar tificial intelligence and machine","page_number":94,"box":{"x":69,"y":438,"width":812,"height":11}},{"id":"171c84ca-f8ba-4430-868c-ab674910346c","block_type":"box","text":"learning (“AI”), which may result in losses for the Fund and its shareholders or impair the Fund’s operations. These","page_number":94,"box":{"x":70,"y":453,"width":820,"height":11}},{"id":"9f5c0ef0-0bc9-4971-98db-d02b693a36db","block_type":"box","text":"entities include, but are not limited to, the Fund’s adviser, administrator, distributor, other service providers (e.g.,","page_number":94,"box":{"x":69,"y":468,"width":807,"height":11}},{"id":"0c980b91-6982-4aea-9de4-72ba0e082843","block_type":"box","text":"index and benchmark providers, accountants, custodians, and transfer agents), financial intermediaries,","page_number":94,"box":{"x":70,"y":483,"width":741,"height":11}},{"id":"a8b23075-c9d5-4fa5-9663-56649ebfabf7","block_type":"box","text":"counterpar ties, market makers, Authorized Par ticipants, listing exchanges, other financial market operators, and","page_number":94,"box":{"x":69,"y":498,"width":802,"height":11}},{"id":"49d5eea0-89e2-4970-99a6-d03c9bb246dc","block_type":"box","text":"governmental authorities, as applicable. Operational and technology risks for the issuers in which the Fund invests","page_number":94,"box":{"x":68,"y":513,"width":818,"height":12}},{"id":"cb0da248-d978-4af7-a237-3cb587d034e9","block_type":"box","text":"could also result in material adverse consequences for such issuers and may cause the Fund’s investments in such","page_number":94,"box":{"x":69,"y":528,"width":827,"height":12}},{"id":"0ede2bac-3316-4803-aa98-2f45bb2e8f06","block_type":"box","text":"issuers to lose value. The Fund may incur substantial costs in order to mitigate operational and technology risks.","page_number":94,"box":{"x":70,"y":544,"width":803,"height":11}},{"id":"6eeebeea-116a-4d60-887e-e7bfef2ba66d","block_type":"box","text":"Cybersecurity incidents can result from deliberate attacks or unintentional events against an issuer in which the","page_number":94,"box":{"x":102,"y":566,"width":796,"height":11}},{"id":"d11c4b7b-5798-443c-a0d3-88b4ab8cd869","block_type":"box","text":"Fund invests, the Fund or any of its service providers. They include, but are not limited to, gaining unauthorized","page_number":94,"box":{"x":70,"y":581,"width":790,"height":12}},{"id":"7c42ccb4-5537-48ef-9aec-f5f3264dd504","block_type":"box","text":"access to systems, misappropriating assets or sensitive information, corrupting or destroying data, and causing","page_number":94,"box":{"x":69,"y":596,"width":800,"height":12}},{"id":"9d15d28d-8c25-49e3-bc96-4e8f80658ddf","block_type":"box","text":"operational disruption. Geopolitical tension may increase the scale and sophistication of deliberate attacks,","page_number":94,"box":{"x":69,"y":612,"width":768,"height":11}},{"id":"75b50396-3b2c-4bd2-937a-eb0c73e67472","block_type":"box","text":"par ticularly those from nation states or from entities with nation state backing. Cybersecurity incidents may result in","page_number":94,"box":{"x":70,"y":627,"width":827,"height":11}},{"id":"b53b8eaa-dd75-49e2-9ab3-3362e3476f1e","block_type":"box","text":"any of the following: financial losses; inter ference with the Fund’s ability to calculate its NAV; disclosure of","page_number":94,"box":{"x":69,"y":642,"width":760,"height":11}},{"id":"8faa9239-c1bf-4901-91f4-e201e3724737","block_type":"box","text":"confidential information; impediments to trading; submission of erroneous trades by the Fund or erroneous","page_number":94,"box":{"x":69,"y":657,"width":763,"height":11}},{"id":"c233bc61-f055-4490-a1b8-b37ba88de1ec","block_type":"box","text":"subscription or redemption orders; the inability of the Fund or its service providers to transact business; violations of","page_number":94,"box":{"x":69,"y":672,"width":835,"height":11}},{"id":"1fdde4b2-1557-4cc3-9054-b2414c971b57","block_type":"box","text":"applicable privacy and other laws; regulatory fines; penalties; reputational damage; reimbursement or other","page_number":94,"box":{"x":69,"y":687,"width":766,"height":11}},{"id":"86b3fd3a-db5a-44e5-aac2-eb77e1bc9558","block_type":"box","text":"compensation costs; and other legal and compliance expenses. Fur thermore, cybersecurity incidents may render","page_number":94,"box":{"x":69,"y":703,"width":804,"height":11}},{"id":"4c8d22ff-5549-4959-a4d2-dfc43e983713","block_type":"box","text":"records of the Fund, including records relating to its assets and transactions, shareholder ownership of Fund shares,","page_number":94,"box":{"x":69,"y":717,"width":833,"height":12}},{"id":"f14c18ad-f5bf-4455-b80a-f1c05f2508c8","block_type":"box","text":"and other data integral to the Fund’s functioning, inaccessible, inaccurate or incomplete. Power outages, natural","page_number":94,"box":{"x":69,"y":732,"width":800,"height":12}},{"id":"3f276576-a1c4-400f-8904-99f45ffd9fa1","block_type":"box","text":"disasters, equipment malfunctions and processing errors that threaten information and technology systems relied","page_number":94,"box":{"x":69,"y":748,"width":812,"height":11}},{"id":"362d1a49-0b82-43f5-bbfa-184611ca535b","block_type":"box","text":"upon by the Fund or its service providers, as well as market events that occur at a pace that overloads these","page_number":94,"box":{"x":69,"y":763,"width":777,"height":11}},{"id":"cc8d7619-d95b-4856-8640-a6a20f35a16b","block_type":"box","text":"systems, may also disrupt business operations or impact critical data. Recent advances in AI technology pose risks","page_number":94,"box":{"x":69,"y":778,"width":824,"height":11}},{"id":"a95a3b0e-feb5-4f4d-a499-bb9ff7e439c2","block_type":"box","text":"to the Fund and its por tfolio investments. These advancements could harm the Fund and its por tfolio investments by","page_number":94,"box":{"x":68,"y":793,"width":836,"height":11}},{"id":"99e8fbb1-db81-4839-a145-5c9ea2d55349","block_type":"box","text":"reducing the demand for both the technology and software offerings of the Fund’s por tfolio investments. Additionally,","page_number":94,"box":{"x":69,"y":808,"width":833,"height":11}},{"id":"042b4dd3-6f11-4946-8569-d7d15272c563","block_type":"box","text":"these advancements could significantly disrupt the Fund’s por tfolio investments and subject them to increased","page_number":94,"box":{"x":68,"y":823,"width":793,"height":12}},{"id":"c2b14573-19b6-4036-8dbe-d221f7dc981b","block_type":"box","text":"competition, which could have a material adverse effect on business, financial condition, and results of operations.","page_number":94,"box":{"x":69,"y":838,"width":822,"height":11}},{"id":"7edfdf79-15c2-420a-baa1-6dcc2fe492c8","block_type":"box","text":"AI technology advancements, including efficiency improvements, without related increases in the adoption and","page_number":94,"box":{"x":68,"y":853,"width":787,"height":12}},{"id":"05b88ded-8ec5-4cce-ac7f-b50f596b340b","block_type":"box","text":"development of such technologies, could also negatively impact demand for, and the valuation of, digital","page_number":94,"box":{"x":69,"y":869,"width":742,"height":11}},{"id":"47855904-1757-472f-878b-fb461e7dcde5","block_type":"box","text":"infrastructure assets.","page_number":94,"box":{"x":70,"y":884,"width":151,"height":9}},{"id":"80be4a75-d96a-4830-97c2-b7ac0e7c4169","block_type":"box","text":"II-63","page_number":94,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"6f7cc002-0307-400f-a8d4-b9a405e0052b","block_type":"box","text":"NM1026U-5982568-94/232","page_number":94,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"c996206d-1cbd-4f50-b39b-b35f0774b32d","block_type":"box","text":"The Fund and its por tfolio investments could be exposed to the risks of AI technology if third-par ty service","page_number":95,"box":{"x":101,"y":45,"width":755,"height":11}},{"id":"0da1cf05-30bb-4c72-9719-49ce8aabaff3","block_type":"box","text":"providers or any counterpar ties, whether or not known to the Fund, also use AI technology in their business activities.","page_number":95,"box":{"x":70,"y":60,"width":835,"height":11}},{"id":"9b808132-2af9-47ee-ad72-9d030382e118","block_type":"box","text":"The Fund and its service providers may not be in a position to control the use of AI technology in third-par ty products","page_number":95,"box":{"x":68,"y":75,"width":833,"height":11}},{"id":"9f4938e4-0378-44f9-b29f-5629945552b7","block_type":"box","text":"or services.","page_number":95,"box":{"x":69,"y":90,"width":82,"height":9}},{"id":"ae7c597f-43c3-4bcb-ba03-b83c5fbdaeff","block_type":"box","text":"Use of AI technology could include the input of confidential information in contravention of applicable policies,","page_number":95,"box":{"x":102,"y":113,"width":781,"height":11}},{"id":"0a4be21c-3360-4bbf-837b-7d2a256b90d5","block_type":"box","text":"contractual or other obligations or restrictions, resulting in such confidential information becoming accessible by","page_number":95,"box":{"x":69,"y":128,"width":801,"height":11}},{"id":"5cd5ea88-6792-4598-a28f-3777a5714cd9","block_type":"box","text":"other third-par ty AI technology applications and users.","page_number":95,"box":{"x":69,"y":143,"width":383,"height":11}},{"id":"60d6b837-5863-43dc-af0c-8300edfdc100","block_type":"box","text":"Independent of its context of use, AI technology is generally highly reliant on the collection and analysis of large","page_number":95,"box":{"x":102,"y":166,"width":795,"height":11}},{"id":"e859fe65-bd10-4810-a8e7-e68d75a1a5d1","block_type":"box","text":"amounts of data, may incorporate biased or inaccurate data, and it is not possible or practicable to incorporate all","page_number":95,"box":{"x":69,"y":181,"width":813,"height":11}},{"id":"63ed15d7-1b61-45c4-ac15-63a4e0de3ec5","block_type":"box","text":"relevant data into the models that AI technology utilizes to operate. Cer tain data in such models will inevitably","page_number":95,"box":{"x":69,"y":196,"width":785,"height":11}},{"id":"fcd6166c-d029-4494-9d61-6acec54a155b","block_type":"box","text":"contain a degree of inaccuracy and error, or could otherwise be inadequate or flawed, which would be likely to","page_number":95,"box":{"x":69,"y":211,"width":782,"height":11}},{"id":"79a1da18-fb41-4c06-9597-41fda8e57858","block_type":"box","text":"degrade the effectiveness of AI technology. The output or results of any such AI technologies may therefore be","page_number":95,"box":{"x":69,"y":226,"width":787,"height":11}},{"id":"89e71784-0420-4946-8f1d-67df8ea981ad","block_type":"box","text":"incomplete, erroneous, distor ted, or misleading. Fur ther, AI tools may lack transparency as to how data is utilized","page_number":95,"box":{"x":70,"y":241,"width":809,"height":11}},{"id":"ce2ff06a-27a9-46eb-a2f1-deffa587e0f8","block_type":"box","text":"and how outputs are generated. AI technologies may also allow the unintended introduction of vulnerabilities into","page_number":95,"box":{"x":69,"y":256,"width":805,"height":12}},{"id":"76516c75-cc5b-4ff9-9865-f9fb52432c97","block_type":"box","text":"infrastructures and applications. To the extent that the Fund or its por tfolio investments are exposed to the risks of","page_number":95,"box":{"x":70,"y":271,"width":822,"height":11}},{"id":"192ac71d-adbb-4a0e-9fab-06d346b31473","block_type":"box","text":"AI technology use, any such inaccuracies or errors could have adverse impacts on the Fund or its investments.","page_number":95,"box":{"x":68,"y":287,"width":789,"height":11}},{"id":"914b2d19-c008-4d59-ae7a-e505660ae913","block_type":"box","text":"Regulations related to AI technology could also impose cer tain obligations and costs related to monitoring and","page_number":95,"box":{"x":102,"y":309,"width":786,"height":11}},{"id":"d455ed7d-3b45-465a-b729-c68193bcfe0d","block_type":"box","text":"compliance. For example, in April 2023, the Federal Trade Commission, U.S. Depar tment of Justice, Consumer","page_number":95,"box":{"x":69,"y":324,"width":791,"height":11}},{"id":"bc526799-8dd9-4c13-86e6-c206173d581d","block_type":"box","text":"Financial Protection Bureau, and U.S. Equal Employment Oppor tunity Commission released a joint statement on","page_number":95,"box":{"x":70,"y":340,"width":796,"height":11}},{"id":"a7f60a75-d2de-418f-b7d2-f11caccc3158","block_type":"box","text":"ar tificial intelligence demonstrating interest in monitoring the development and use of automated systems and","page_number":95,"box":{"x":69,"y":355,"width":788,"height":11}},{"id":"56e68840-11ac-43f7-9de2-2f4d8eea0a28","block_type":"box","text":"enforcement of their respective laws and regulations. In October 2023, an executive order established new standards","page_number":95,"box":{"x":69,"y":370,"width":839,"height":11}},{"id":"7abf00e8-f2d3-4081-8cf9-157acb16032e","block_type":"box","text":"for AI safety and security. In addition to the U.S. regulatory framework, in 2024, the EU adopted the Ar tificial","page_number":95,"box":{"x":68,"y":385,"width":773,"height":11}},{"id":"00cdb941-b760-4bc6-b6f9-90fc81133612","block_type":"box","text":"Intelligence Act, which applies to cer tain AI technology and the data used to train, test, and deploy them, which may","page_number":95,"box":{"x":70,"y":400,"width":826,"height":11}},{"id":"6fc89c11-f836-4e20-b5e4-29780c6aeba2","block_type":"box","text":"create additional compliance burdens, higher administrative costs, and significant penalties should the Fund, the","page_number":95,"box":{"x":69,"y":415,"width":805,"height":11}},{"id":"f72d9be9-995e-48cb-aeea-639dc522f8b5","block_type":"box","text":"adviser, or the Fund’s por tfolio investments fail to comply.","page_number":95,"box":{"x":69,"y":430,"width":412,"height":11}},{"id":"b92ed8f0-ad50-44c4-935c-fb9f30387318","block_type":"box","text":"AI technology and its applications, including in the investment and financial sectors, continue to develop rapidly,","page_number":95,"box":{"x":101,"y":453,"width":797,"height":11}},{"id":"0ffe0cd6-d92a-49d0-b0da-1cbdcf84bc5c","block_type":"box","text":"and it is impossible to predict the future risks that may arise from such developments. The full extent of current or","page_number":95,"box":{"x":69,"y":468,"width":817,"height":11}},{"id":"7593daed-e73b-4666-b5a4-5e6e4b53a23f","block_type":"box","text":"future risks related thereto is not possible to predict, and the Fund may not be able to anticipate, prevent, mitigate,","page_number":95,"box":{"x":68,"y":483,"width":824,"height":11}},{"id":"2cf2d31f-bd62-44bb-9c0d-cda221d6e0ca","block_type":"box","text":"or remediate all of the potential risks, challenges, or impacts of such changes.","page_number":95,"box":{"x":69,"y":498,"width":561,"height":11}},{"id":"f3ec0977-80a6-4ac1-8168-fa20587d445a","block_type":"box","text":"While the Fund’s service providers are required to have appropriate operational, information security and","page_number":95,"box":{"x":101,"y":521,"width":747,"height":11}},{"id":"12f9c08d-245f-445b-9be4-d87f56007d76","block_type":"box","text":"cybersecurity risk management policies and procedures, their methods of risk management may differ from those of","page_number":95,"box":{"x":69,"y":536,"width":830,"height":11}},{"id":"75a9b20d-49b3-4418-ae3b-896fa7dc92d8","block_type":"box","text":"the Fund in the setting of priorities, the personnel and resources available or the effectiveness of relevant controls.","page_number":95,"box":{"x":68,"y":551,"width":823,"height":11}},{"id":"23508deb-d6d4-49f3-8196-aed8d2cb5e81","block_type":"box","text":"The Fund and its adviser seek to reduce these risks through controls, procedures and oversight, including","page_number":95,"box":{"x":68,"y":566,"width":755,"height":11}},{"id":"440b46e4-7287-47db-bfe4-b3dae9f0157e","block_type":"box","text":"establishing business continuity plans and risk management systems. However, there are inherent limitations in such","page_number":95,"box":{"x":69,"y":582,"width":838,"height":11}},{"id":"90042221-3949-4b8b-baad-27b72e6578b1","block_type":"box","text":"plans and systems, including the possibility that cer tain risks that may affect the Fund have not been identified or","page_number":95,"box":{"x":70,"y":596,"width":812,"height":12}},{"id":"847d3a69-c161-4f91-9d83-323bc99aa3c2","block_type":"box","text":"may emerge in the future; that such plans and systems may not completely eliminate the occurrence or mitigate the","page_number":95,"box":{"x":69,"y":612,"width":828,"height":11}},{"id":"c01ecbb3-f816-4f60-bc89-79bbf039a1bd","block_type":"box","text":"effects of operational or information security disruptions or failures or of cybersecurity incidents; or that prevention","page_number":95,"box":{"x":69,"y":627,"width":819,"height":11}},{"id":"0fc0092e-adb2-4a0f-b23a-4462b9b7e82d","block_type":"box","text":"and remediation effor ts will not be successful or that incidents will go undetected. The Fund cannot control the","page_number":95,"box":{"x":69,"y":642,"width":792,"height":11}},{"id":"df663411-d610-4241-bfce-f2959f5041d2","block_type":"box","text":"systems, information security or other cybersecurity of the issuers in which it invests or its service providers,","page_number":95,"box":{"x":69,"y":657,"width":775,"height":11}},{"id":"385981f3-3777-4f6a-93ae-c7a430674027","block_type":"box","text":"counterpar ties, and other third par ties whose activities affect the Fund.","page_number":95,"box":{"x":69,"y":672,"width":510,"height":11}},{"id":"5c7ac7f8-a3e4-434c-be00-9cc6b8d0a6cb","block_type":"box","text":"Lastly, the regulatory climate governing cybersecurity and data protection is developing quickly and may vary","page_number":95,"box":{"x":102,"y":695,"width":771,"height":11}},{"id":"9217616d-ff52-428b-81c0-0ddb8e1b18f8","block_type":"box","text":"considerably across jurisdictions. Regulators continue to develop new rules and standards related to cybersecurity","page_number":95,"box":{"x":69,"y":710,"width":816,"height":11}},{"id":"1e3d4fca-d567-4d9b-a469-b3d16dd4f414","block_type":"box","text":"and data protection. Compliance with evolving regulations can be demanding and costly, requiring substantial","page_number":95,"box":{"x":69,"y":725,"width":778,"height":11}},{"id":"2ca2752c-b9bc-4464-8684-246f52b71158","block_type":"box","text":"resources to monitor and implement required changes.","page_number":95,"box":{"x":69,"y":740,"width":391,"height":11}},{"id":"e7636755-f94f-43a4-9f33-a6580dcd0879","block_type":"box","text":"Participation Notes.","page_number":95,"box":{"x":102,"y":763,"width":145,"height":11}},{"id":"364dab06-0111-494a-8f28-9c6db6ccd25c","block_type":"box","text":"A Fund may buy par ticipation notes from a bank or broker-dealer (“issuer”) that entitle the","page_number":95,"box":{"x":253,"y":763,"width":641,"height":11}},{"id":"7de9d28a-dba9-46ff-b4b6-54c66404b004","block_type":"box","text":"Fund to a return measured by the change in value of an identified underlying security or basket of securities","page_number":95,"box":{"x":70,"y":778,"width":766,"height":11}},{"id":"ed095121-4fad-4881-bc81-c7fb21c9d6e4","block_type":"box","text":"(collectively, the “underlying security”). Par ticipation notes are typically used when a direct investment in the","page_number":95,"box":{"x":69,"y":793,"width":772,"height":11}},{"id":"97693c27-8f42-4933-9721-a30b523ea680","block_type":"box","text":"underlying security is restricted due to country-specific regulations.","page_number":95,"box":{"x":69,"y":808,"width":475,"height":11}},{"id":"fc9845ee-1fe4-400e-a5a7-36c018773c56","block_type":"box","text":"The Fund is subject to counterpar ty risk associated with each issuer. Investment in a par ticipation note is not","page_number":95,"box":{"x":101,"y":831,"width":782,"height":11}},{"id":"d47767ac-f62c-4b2d-b2f4-f59439719164","block_type":"box","text":"the same as investment in the constituent shares of the company. A par ticipation note represents only an obligation","page_number":95,"box":{"x":68,"y":846,"width":831,"height":11}},{"id":"04fe068a-5673-4482-ae13-612600dc8ce9","block_type":"box","text":"of the issuer to provide the Fund the economic per formance equivalent to holding shares of an underlying security. A","page_number":95,"box":{"x":69,"y":861,"width":831,"height":11}},{"id":"8162cc82-6177-4b13-b758-8d29cb8870d1","block_type":"box","text":"par ticipation note does not provide any beneficial or equitable entitlement or interest in the relevant underlying","page_number":95,"box":{"x":70,"y":876,"width":789,"height":11}},{"id":"40bc6847-cc84-496f-8439-df49d5da3436","block_type":"box","text":"security. In other words, shares of the underlying security are not in any way owned by the Fund. However, each","page_number":95,"box":{"x":69,"y":891,"width":791,"height":12}},{"id":"6a29a088-8f4b-4f83-84da-9ea587274b86","block_type":"box","text":"par ticipation note synthetically replicates the economic benefit of holding shares in the underlying security. Because","page_number":95,"box":{"x":70,"y":906,"width":827,"height":12}},{"id":"e34719f7-44b7-46d6-8d10-8ee8fc58cd2b","block_type":"box","text":"II-64","page_number":95,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"0dce3a20-8928-4341-b1c9-8104b60cb454","block_type":"box","text":"NM1026U-5982568-95/232","page_number":95,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"dfea79dd-c89c-48ab-b1a0-53d760346ebd","block_type":"box","text":"a par ticipation note is an obligation of the issuer, rather than a direct investment in shares of the underlying security,","page_number":96,"box":{"x":69,"y":45,"width":834,"height":11}},{"id":"c471e8f3-8baf-4e4d-8392-a16b42f43e9e","block_type":"box","text":"a Fund may suffer losses potentially equal to the full value of the par ticipation note if the issuer fails to per form its","page_number":96,"box":{"x":69,"y":60,"width":822,"height":11}},{"id":"c79ba299-c287-4000-8820-2511d71dba7e","block_type":"box","text":"obligations. A Fund attempts to mitigate that risk by purchasing only from issuers determined to be creditwor thy.","page_number":96,"box":{"x":69,"y":75,"width":801,"height":11}},{"id":"16f377d8-93b3-42ec-b767-1876aa7f159a","block_type":"box","text":"The counterpar ty may, but is not required to, purchase the shares of the underlying security to hedge its","page_number":96,"box":{"x":101,"y":98,"width":743,"height":11}},{"id":"baeb1604-0e85-44e7-896e-3a4bffedcfd0","block_type":"box","text":"obligation. A Fund may, but is not required to, purchase credit protection against the default of the issuer. When the","page_number":96,"box":{"x":69,"y":113,"width":826,"height":11}},{"id":"35d0b307-d639-436d-a8ce-e58b28526782","block_type":"box","text":"par ticipation note expires or a Fund exercises the par ticipation note and closes its position, the Fund receives a","page_number":96,"box":{"x":70,"y":128,"width":799,"height":11}},{"id":"71e20060-6637-43a8-9473-b31d9a6f6f75","block_type":"box","text":"payment that is based upon the then-current value of the underlying security conver ted into U.S. dollars (less","page_number":96,"box":{"x":70,"y":143,"width":776,"height":11}},{"id":"8dbe9794-f916-4d60-a8bb-bdf8774f7d63","block_type":"box","text":"transaction costs). The price, per formance and liquidity of a par ticipation note are all linked directly to the underlying","page_number":96,"box":{"x":68,"y":158,"width":834,"height":11}},{"id":"9bfff844-96e9-41d0-a768-7780af186cfb","block_type":"box","text":"security. A Fund’s ability to redeem or exercise a par ticipation note generally is dependent on the liquidity in the local","page_number":96,"box":{"x":69,"y":173,"width":834,"height":11}},{"id":"e06e588b-26d4-498a-8451-35eb2c4f5243","block_type":"box","text":"trading market for the security underlying the par ticipation note.","page_number":96,"box":{"x":68,"y":188,"width":454,"height":12}},{"id":"f7e5e49d-6c21-4b63-83aa-786ab9174593","block_type":"box","text":"Portfolio Turnover Rates.","page_number":96,"box":{"x":102,"y":211,"width":181,"height":9}},{"id":"bb14af71-1d7d-4adf-ac98-7136a8c6413f","block_type":"box","text":"A Fund’s annual por tfolio turnover rate will not be a factor preventing a sale or","page_number":96,"box":{"x":289,"y":211,"width":558,"height":11}},{"id":"2a9ecb64-51c5-46db-a35c-cb67ae524a1e","block_type":"box","text":"purchase when the Manager believes investment considerations warrant such sale or purchase. Although cer tain","page_number":96,"box":{"x":70,"y":226,"width":804,"height":11}},{"id":"4a89fbe9-f503-4269-8c28-536b2a05b7f3","block_type":"box","text":"Funds will use an approach to investing that is largely a passive, indexing approach, such Funds may engage in a","page_number":96,"box":{"x":70,"y":241,"width":806,"height":11}},{"id":"64f18686-6a9b-4a88-a879-02451d10981c","block_type":"box","text":"substantial number of por tfolio transactions. With respect to these Funds, the rate of por tfolio turnover will be a","page_number":96,"box":{"x":69,"y":256,"width":800,"height":11}},{"id":"eeea5ba1-d71e-42b0-ab1a-f0ab37f62c38","block_type":"box","text":"limiting factor when the Manager considers whether to purchase or sell securities for a Fund only to the extent that","page_number":96,"box":{"x":70,"y":271,"width":818,"height":12}},{"id":"90ec165e-41d7-4c95-a535-151a9a835458","block_type":"box","text":"the Manager will consider the impact of transaction costs on a Fund’s tracking error. Por tfolio turnover may vary","page_number":96,"box":{"x":68,"y":286,"width":800,"height":12}},{"id":"844f62d4-08ca-4b02-9d38-1ffd6be56024","block_type":"box","text":"greatly from year to year as well as within a par ticular year. High por tfolio turnover (","page_number":96,"box":{"x":68,"y":302,"width":595,"height":11}},{"id":"27bb9187-e0f4-4eb6-9a2c-02493bedd7af","block_type":"box","text":"i.e.","page_number":96,"box":{"x":665,"y":302,"width":20,"height":9}},{"id":"963ad32f-3b70-441e-9fd7-aa94acafac23","block_type":"box","text":", 100% or more) may result in","page_number":96,"box":{"x":687,"y":302,"width":210,"height":11}},{"id":"8383e9bb-9700-4173-8802-6402ec0afd60","block_type":"box","text":"increased transaction costs to a Fund, including brokerage commissions, dealer mark-ups and other transaction","page_number":96,"box":{"x":70,"y":317,"width":797,"height":11}},{"id":"fcb7fb08-144f-49b3-ac70-2c0fce14c1ca","block_type":"box","text":"costs on the sale of the securities and reinvestment in other securities. The sale of a Fund’s securities may result in","page_number":96,"box":{"x":69,"y":332,"width":832,"height":11}},{"id":"74eb7512-9d23-4c27-bc85-6cee42a753ea","block_type":"box","text":"the recognition of capital gain or loss. Given the frequency of sales, such gain or loss will likely be shor t-term capital","page_number":96,"box":{"x":68,"y":347,"width":831,"height":11}},{"id":"e2e1af6f-8325-4687-91d6-6c568681e95b","block_type":"box","text":"gain or loss. These effects of higher than normal por tfolio turnover may adversely affect a Fund’s per formance.","page_number":96,"box":{"x":68,"y":362,"width":795,"height":11}},{"id":"a21250c7-a215-45cc-807e-0ee832cd0fda","block_type":"box","text":"Preferred Stock.","page_number":96,"box":{"x":102,"y":385,"width":118,"height":9}},{"id":"c7b05a5d-12dc-4c23-aafd-91bd7f313759","block_type":"box","text":"Cer tain Funds may invest in preferred stocks. Preferred stock has a preference over common","page_number":96,"box":{"x":226,"y":385,"width":665,"height":11}},{"id":"96ce8cea-0603-419f-a76a-1eee21826264","block_type":"box","text":"stock in liquidation (and generally dividends as well) but is subordinated to bond holders and other creditors in all","page_number":96,"box":{"x":69,"y":400,"width":808,"height":11}},{"id":"69b04af7-7028-423e-a26a-a166181f1a34","block_type":"box","text":"respects. As a general rule, the market value of preferred stock with a fixed dividend rate and no conversion element","page_number":96,"box":{"x":69,"y":415,"width":834,"height":11}},{"id":"3975762c-8932-47b9-b27d-30c0b812bbe1","block_type":"box","text":"varies inversely with interest rates and perceived credit risk, while the market price of conver tible preferred stock","page_number":96,"box":{"x":68,"y":430,"width":808,"height":11}},{"id":"c595acef-fb17-4f94-a6e1-1b0ebb2b10da","block_type":"box","text":"generally also reflects some element of conversion value. Because preferred stock is junior to debt securities and","page_number":96,"box":{"x":68,"y":445,"width":813,"height":12}},{"id":"b61c7305-aff3-481b-b042-0cd8dc5b5d2d","block_type":"box","text":"other obligations of the issuer, deterioration in the credit quality of the issuer will cause greater changes in the value","page_number":96,"box":{"x":69,"y":460,"width":831,"height":12}},{"id":"2fe19fb8-cd17-4bd1-8fcd-3e7816bfde70","block_type":"box","text":"of a preferred stock than in a more senior debt security with similar stated yield characteristics. Unlike interest","page_number":96,"box":{"x":69,"y":475,"width":791,"height":12}},{"id":"aed7be3b-5298-4fc3-ac73-55bb6cee98b3","block_type":"box","text":"payments on debt securities, preferred stock dividends are payable only if declared by the issuer’s board of directors.","page_number":96,"box":{"x":70,"y":491,"width":838,"height":11}},{"id":"46e5559f-4355-44a9-9c7e-221496557200","block_type":"box","text":"Preferred stock also may be subject to optional or mandatory redemption provisions.","page_number":96,"box":{"x":69,"y":506,"width":604,"height":11}},{"id":"5956d003-bfb7-4539-b2fb-cb0f836c9c4d","block_type":"box","text":"Tax-Exempt Preferred Shares.","page_number":96,"box":{"x":103,"y":528,"width":207,"height":11}},{"id":"dbd93629-0903-4be0-a45c-a4b86200539f","block_type":"box","text":"Cer tain Funds may invest in preferred interests of other investment funds that pay","page_number":96,"box":{"x":316,"y":528,"width":588,"height":12}},{"id":"3a4363e3-c166-4d66-92d3-125f66e59b53","block_type":"box","text":"dividends that are exempt from regular U.S. federal income tax. Such funds in turn invest in municipal bonds and","page_number":96,"box":{"x":69,"y":543,"width":806,"height":12}},{"id":"6bf5a21d-475c-4d11-8aec-15d7b7850880","block_type":"box","text":"other assets that pay interest or make distributions that are exempt from regular U.S. federal income tax, such as","page_number":96,"box":{"x":69,"y":559,"width":814,"height":11}},{"id":"62750a98-5755-4d1e-935b-591b8894cdd3","block_type":"box","text":"revenue bonds issued by state or local agencies to fund the development of low-income, multi-family housing.","page_number":96,"box":{"x":69,"y":574,"width":780,"height":11}},{"id":"d795f7f4-0ddf-4aaf-8529-e82162c4a75c","block_type":"box","text":"Investment in such tax-exempt preferred shares involves many of the same issues as investing in other investment","page_number":96,"box":{"x":70,"y":589,"width":820,"height":11}},{"id":"f1f63e8e-f37a-4b64-b614-79692f94c15c","block_type":"box","text":"companies. These investments also have additional risks, including illiquid investments risk, the absence of","page_number":96,"box":{"x":69,"y":604,"width":772,"height":11}},{"id":"5b229e36-2ee7-4059-aae8-575d04aac3b9","block_type":"box","text":"regulation governing investment practices, capital structure and leverage, affiliated transactions and other matters,","page_number":96,"box":{"x":69,"y":619,"width":821,"height":11}},{"id":"016ac8a1-0046-464a-bd3c-8b1a58cfe895","block_type":"box","text":"and concentration of investments in par ticular issuers or industries. The Municipal Bond Funds will treat investments","page_number":96,"box":{"x":69,"y":634,"width":834,"height":11}},{"id":"203f68f4-9709-4b55-bc71-fc641da477fd","block_type":"box","text":"in tax-exempt preferred shares as investments in municipal bonds.","page_number":96,"box":{"x":70,"y":649,"width":474,"height":11}},{"id":"1da30185-a613-4d7d-96a8-e1ef0f65a844","block_type":"box","text":"Trust Preferred Securities.","page_number":96,"box":{"x":103,"y":672,"width":184,"height":9}},{"id":"9fcac404-161d-4f08-9d30-bd4c413843ee","block_type":"box","text":"Cer tain Funds may invest in trust preferred securities. Trust preferred securities are","page_number":96,"box":{"x":294,"y":672,"width":599,"height":11}},{"id":"10230acf-f21d-4319-bd8f-b1b3949db2bd","block_type":"box","text":"typically issued by corporations, generally in the form of interest bearing notes with preferred securities","page_number":96,"box":{"x":68,"y":687,"width":737,"height":11}},{"id":"eed2bdc1-81c3-44bc-95fb-7015d8951ed1","block_type":"box","text":"characteristics, or by an affiliated business trust of a corporation, generally in the form of beneficial interests in","page_number":96,"box":{"x":69,"y":702,"width":796,"height":12}},{"id":"0e0d915f-ca4a-4c19-aa44-d2e408c43109","block_type":"box","text":"subordinated debentures or similarly structured securities. The trust preferred securities market consists of both","page_number":96,"box":{"x":69,"y":717,"width":805,"height":12}},{"id":"dd21947b-3820-45c7-baaa-a696b80d8de1","block_type":"box","text":"fixed and adjustable coupon rate securities that are either perpetual in nature or have stated maturity dates.","page_number":96,"box":{"x":68,"y":732,"width":773,"height":12}},{"id":"546fa467-25a8-4bbf-8184-7bb2a0db44c3","block_type":"box","text":"Trust preferred securities are typically junior and fully subordinated liabilities of an issuer and benefit from a","page_number":96,"box":{"x":101,"y":755,"width":770,"height":11}},{"id":"ab2060b0-fd77-4a63-9b89-7ca8a5e0dc34","block_type":"box","text":"guarantee that is junior and fully subordinated to the other liabilities of the guarantor. In addition, trust preferred","page_number":96,"box":{"x":68,"y":770,"width":801,"height":12}},{"id":"83a4394a-8fb1-4470-a19f-fe6a505255e9","block_type":"box","text":"securities typically permit an issuer to defer the payment of income for five years or more without triggering an event","page_number":96,"box":{"x":69,"y":785,"width":830,"height":12}},{"id":"28f41214-131a-4cc2-9dfc-430aa44cc8d4","block_type":"box","text":"of default. Because of their subordinated position in the capital structure of an issuer, the ability to defer payments","page_number":96,"box":{"x":69,"y":801,"width":822,"height":11}},{"id":"8fbc973b-13f2-44ed-9b38-4fdea46d8fc8","block_type":"box","text":"for extended periods of time without default consequences to the issuer, and cer tain other features (such as","page_number":96,"box":{"x":68,"y":816,"width":777,"height":11}},{"id":"9b373263-3dca-442b-867f-0dde825a7f4f","block_type":"box","text":"restrictions on common dividend payments by the issuer or ultimate guarantor when full cumulative payments on the","page_number":96,"box":{"x":69,"y":831,"width":831,"height":11}},{"id":"fce35f13-8e80-4574-a4a8-dce9c7da6fef","block_type":"box","text":"trust preferred securities have not been made), these trust preferred securities are often treated as close","page_number":96,"box":{"x":68,"y":846,"width":757,"height":11}},{"id":"65062a10-485a-4308-a987-98bfd9c7cd06","block_type":"box","text":"substitutes for traditional preferred securities, both by issuers and investors.","page_number":96,"box":{"x":69,"y":861,"width":548,"height":11}},{"id":"9dcabd1b-a0e7-45cc-bf4c-9ec1202e7601","block_type":"box","text":"Trust preferred securities include but are not limited to trust originated preferred securities (“TOPRS","page_number":96,"box":{"x":101,"y":884,"width":715,"height":11}},{"id":"ce385113-7b28-4431-b797-ff108b41a860","block_type":"box","text":"®","page_number":96,"box":{"x":817,"y":884,"width":5,"height":5}},{"id":"68ef62fd-a272-4dcf-bffa-8396a02117f7","block_type":"box","text":"”); monthly","page_number":96,"box":{"x":824,"y":884,"width":77,"height":11}},{"id":"b612ab70-4052-4b3f-bfbb-5a2e901fd01a","block_type":"box","text":"income preferred securities (“MIPS","page_number":96,"box":{"x":70,"y":899,"width":248,"height":11}},{"id":"fb982c96-c6ca-4e07-b0e5-3050b1bc6182","block_type":"box","text":"®","page_number":96,"box":{"x":319,"y":899,"width":6,"height":5}},{"id":"e57ad644-e2f2-4a52-9118-554f68decc66","block_type":"box","text":"”); quar terly income bond securities (“QUIBS","page_number":96,"box":{"x":326,"y":899,"width":317,"height":11}},{"id":"f67f1ba1-4698-4cad-9125-ba826dafe6c3","block_type":"box","text":"®","page_number":96,"box":{"x":644,"y":899,"width":6,"height":5}},{"id":"95f9786e-ebc7-4039-8e13-0b964cba8624","block_type":"box","text":"” ); quar terly income debt securities","page_number":96,"box":{"x":652,"y":899,"width":255,"height":11}},{"id":"970d4cf1-cb9e-4bac-ac5f-ea35ec4d1aaa","block_type":"box","text":"II-65","page_number":96,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"56913176-8973-4b78-ae62-04aa7dcc6955","block_type":"box","text":"NM1026U-5982568-96/232","page_number":96,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"192f3de8-ad51-43a7-82ea-a2d2ead14de9","block_type":"box","text":"(“QUIDS","page_number":97,"box":{"x":69,"y":45,"width":57,"height":11}},{"id":"dc3e3ebb-4896-4608-a5b5-a7bc8192d26e","block_type":"box","text":"®","page_number":97,"box":{"x":127,"y":45,"width":6,"height":4}},{"id":"3e6087a9-27c6-44e3-a81a-15246fd70dc0","block_type":"box","text":"”); quar terly income preferred securities (“QUIPS","page_number":97,"box":{"x":135,"y":45,"width":346,"height":11}},{"id":"3a853920-c91b-46d5-96d9-e5804e48dea4","block_type":"box","text":"SM","page_number":97,"box":{"x":482,"y":45,"width":11,"height":4}},{"id":"0e6397e3-0521-4175-a27a-e1cdf7d14f47","block_type":"box","text":"”); corporate trust securities (“CORTS","page_number":97,"box":{"x":495,"y":45,"width":267,"height":11}},{"id":"e4037a3f-7578-4efa-b620-d6d4ba42a2fe","block_type":"box","text":"®","page_number":97,"box":{"x":762,"y":45,"width":6,"height":4}},{"id":"a68d9c9c-f16f-44fb-ba73-0619dc334d3d","block_type":"box","text":"”); public income","page_number":97,"box":{"x":770,"y":45,"width":118,"height":11}},{"id":"a21f7d23-ce6b-4d68-944e-d89e17924e79","block_type":"box","text":"notes (“PINES","page_number":97,"box":{"x":69,"y":60,"width":99,"height":11}},{"id":"ef7336ec-1959-4e6f-a624-b22665cfdd8d","block_type":"box","text":"®","page_number":97,"box":{"x":169,"y":60,"width":6,"height":5}},{"id":"7a7fed4a-84f3-46c3-85bc-1319da1a2620","block_type":"box","text":"”); and other trust preferred securities.","page_number":97,"box":{"x":177,"y":60,"width":275,"height":11}},{"id":"f8660fbf-a5a8-4d7a-893e-fdd91ac0542c","block_type":"box","text":"Trust preferred securities are typically issued with a final maturity date, although some are perpetual in nature.","page_number":97,"box":{"x":101,"y":82,"width":790,"height":12}},{"id":"146dd50b-9692-4bc2-8366-b8ff43455851","block_type":"box","text":"In cer tain instances, a final maturity date may be extended and/or the final payment of principal may be deferred at","page_number":97,"box":{"x":70,"y":98,"width":825,"height":11}},{"id":"574ab411-05c8-41ba-bc48-228aee571e00","block_type":"box","text":"the issuer’s option for a specified time without default. No redemption can typically take place unless all cumulative","page_number":97,"box":{"x":68,"y":113,"width":827,"height":11}},{"id":"4e61274c-5333-4ce0-97ce-8b9aef6af182","block_type":"box","text":"payment obligations have been met, although issuers may be able to engage in open-market repurchases without","page_number":97,"box":{"x":70,"y":128,"width":808,"height":11}},{"id":"85a204a7-f0b3-403c-ac21-64767b392b18","block_type":"box","text":"regard to whether all payments have been paid.","page_number":97,"box":{"x":69,"y":143,"width":338,"height":11}},{"id":"9c9c13b0-0914-443d-9f98-93d3945c0c5d","block_type":"box","text":"Many trust preferred securities are issued by trusts or other special purpose entities established by operating","page_number":97,"box":{"x":102,"y":166,"width":784,"height":11}},{"id":"447b106a-746c-4115-8cf3-b2ac0e55bade","block_type":"box","text":"companies and are not a direct obligation of an operating company. At the time the trust or special purpose entity","page_number":97,"box":{"x":69,"y":181,"width":811,"height":11}},{"id":"79b1eaad-2bf4-4732-90ac-94c4c1acbc7f","block_type":"box","text":"sells such preferred securities to investors, it purchases debt of the operating company (with terms comparable to","page_number":97,"box":{"x":69,"y":196,"width":817,"height":11}},{"id":"7fc24587-8909-4dac-a21d-a7afc2a237c8","block_type":"box","text":"those of the trust or special purpose entity securities), which enables the operating company to deduct for tax","page_number":97,"box":{"x":68,"y":211,"width":785,"height":11}},{"id":"d765b685-5e68-4e21-9fe0-6d62e6791453","block_type":"box","text":"purposes the interest paid on the debt held by the trust or special purpose entity. The trust or special purpose entity","page_number":97,"box":{"x":70,"y":226,"width":830,"height":11}},{"id":"5ac28fa1-e13f-45c1-a3ba-49958b26165c","block_type":"box","text":"is generally required to be treated as transparent for U.S. federal income tax purposes such that the holders of the","page_number":97,"box":{"x":70,"y":241,"width":819,"height":11}},{"id":"7a1060b8-2184-47b4-b65b-e7d167969e6c","block_type":"box","text":"trust preferred securities are treated as owning beneficial interests in the underlying debt of the operating company.","page_number":97,"box":{"x":68,"y":256,"width":827,"height":12}},{"id":"4c87cbd6-10e1-4320-94af-6dcfd83d3163","block_type":"box","text":"Accordingly, payments on the trust preferred securities are treated as interest rather than dividends for U.S. federal","page_number":97,"box":{"x":68,"y":271,"width":824,"height":12}},{"id":"0c606479-20fc-4964-9e09-096472ca2450","block_type":"box","text":"income tax purposes. The trust or special purpose entity in turn would be a holder of the operating company’s debt","page_number":97,"box":{"x":70,"y":286,"width":819,"height":12}},{"id":"964f061e-5f49-4878-a66c-1c8385d66f51","block_type":"box","text":"and would have priority with respect to the operating company’s earnings and profits over the operating company’s","page_number":97,"box":{"x":69,"y":302,"width":817,"height":11}},{"id":"3630604a-4e46-435e-92de-d5f433dc9b48","block_type":"box","text":"common shareholders, but would typically be subordinated to other classes of the operating company’s debt.","page_number":97,"box":{"x":69,"y":317,"width":778,"height":11}},{"id":"48bb7eb9-4c5b-4631-be73-c93cc3296d2a","block_type":"box","text":"Typically a preferred share has a rating that is slightly below that of its corresponding operating company’s senior","page_number":97,"box":{"x":68,"y":332,"width":811,"height":11}},{"id":"200838d4-b5a5-4015-8da9-0a37a6192b9a","block_type":"box","text":"debt securities.","page_number":97,"box":{"x":69,"y":347,"width":109,"height":9}},{"id":"f94979f5-03b8-45e3-98a5-58aa35913700","block_type":"box","text":"Real Estate Investment Trusts (“REITs”).","page_number":97,"box":{"x":102,"y":370,"width":300,"height":11}},{"id":"a3076356-deb2-4fd8-ad9a-2275ffbb12a9","block_type":"box","text":"In pursuing its investment strategy, a Fund may invest in shares of","page_number":97,"box":{"x":409,"y":370,"width":473,"height":11}},{"id":"6c29e293-6f74-4662-9547-93ec9dfa7f6e","block_type":"box","text":"REITs. REITs possess cer tain risks which differ from an investment in common stocks. REITs are financial vehicles","page_number":97,"box":{"x":70,"y":385,"width":814,"height":11}},{"id":"f3834bb7-66cc-4691-857e-6171ea864896","block_type":"box","text":"that pool investor’s capital to purchase or finance real estate. REITs may concentrate their investments in specific","page_number":97,"box":{"x":68,"y":400,"width":814,"height":11}},{"id":"1331ac6f-adb5-4ae0-9f42-ddd4bce2c2a8","block_type":"box","text":"geographic areas or in specific proper ty types,","page_number":97,"box":{"x":68,"y":415,"width":329,"height":11}},{"id":"562e6cac-0547-45c9-9002-4dd1c8d7dd38","block_type":"box","text":"i.e.","page_number":97,"box":{"x":405,"y":415,"width":20,"height":9}},{"id":"9a3b4969-f00e-4ac3-b10c-210fa4fccff0","block_type":"box","text":", hotels, shopping malls, residential complexes and office","page_number":97,"box":{"x":428,"y":415,"width":411,"height":11}},{"id":"fa09dbed-de7b-4d90-9003-00b8242376f4","block_type":"box","text":"buildings.","page_number":97,"box":{"x":69,"y":430,"width":66,"height":11}},{"id":"cca9ac51-12c5-42b4-bb09-635e5d192f44","block_type":"box","text":"REITs are subject to management fees and other expenses, and so a Fund that invests in REITs will bear its","page_number":97,"box":{"x":102,"y":453,"width":768,"height":11}},{"id":"88ace112-aaf0-4853-b565-af0048711293","block_type":"box","text":"propor tionate share of the costs of the REITs’ operations. There are three general categories of REITs: Equity REITs,","page_number":97,"box":{"x":70,"y":468,"width":824,"height":11}},{"id":"b89c29b4-906a-4047-a741-0d5ee0b91e78","block_type":"box","text":"Mor tgage REITs and Hybrid REITs. Equity REITs invest primarily in direct fee ownership or leasehold ownership of real","page_number":97,"box":{"x":70,"y":483,"width":829,"height":11}},{"id":"b8c82279-0744-4581-b733-fe03f776120e","block_type":"box","text":"proper ty, which derive most of their income from rents. Mor tgage REITs invest mostly in mor tgages on real estate,","page_number":97,"box":{"x":70,"y":498,"width":813,"height":11}},{"id":"a2f92d51-6159-42d0-8766-7a61a6aabbc5","block_type":"box","text":"which may secure construction, development or long-term loans; the main source of their income is mor tgage","page_number":97,"box":{"x":68,"y":513,"width":782,"height":12}},{"id":"c105da90-2960-4f9c-841f-ed7b2b08557b","block_type":"box","text":"interest payments. Hybrid REITs hold both ownership and mor tgage interests in real estate.","page_number":97,"box":{"x":70,"y":529,"width":649,"height":11}},{"id":"3b52f6b4-b60d-4e06-b0ac-2e63a24a5985","block_type":"box","text":"Investing in REITs involves cer tain unique risks in addition to those risks associated with investing in the real","page_number":97,"box":{"x":102,"y":551,"width":776,"height":11}},{"id":"0988642d-8f7d-40bb-98ff-0d847df1203b","block_type":"box","text":"estate industry in general. The market value of REIT shares and the ability of the REITs to distribute income may be","page_number":97,"box":{"x":69,"y":566,"width":822,"height":11}},{"id":"847a82be-5199-4a48-9408-30d63f15d541","block_type":"box","text":"adversely affected by several factors, including rising interest rates, changes in the national, state and local","page_number":97,"box":{"x":69,"y":581,"width":769,"height":12}},{"id":"fd26f2e2-3ee8-440f-adb7-8e551b9b821d","block_type":"box","text":"economic climate and real estate conditions, occupancy and rental rates, perceptions of prospective tenants of the","page_number":97,"box":{"x":69,"y":596,"width":822,"height":12}},{"id":"139e3003-3d86-4c5c-bc80-282d918e21e7","block_type":"box","text":"safety, convenience and attractiveness of the proper ties, the ability of the owners to provide adequate management,","page_number":97,"box":{"x":69,"y":612,"width":831,"height":11}},{"id":"8a075fda-779e-4576-aca2-6bde410a475c","block_type":"box","text":"maintenance and insurance, the cost of complying with the Americans with Disabilities Act, increased competition","page_number":97,"box":{"x":69,"y":627,"width":810,"height":11}},{"id":"8eea1586-0c9a-48fa-b183-bc70fa4bbde4","block_type":"box","text":"from new proper ties, the impact of present or future environmental legislation and compliance with environmental","page_number":97,"box":{"x":68,"y":642,"width":812,"height":11}},{"id":"f78d8d87-e5b7-43e4-b58f-0c901d4bda12","block_type":"box","text":"laws, failing to maintain their exemptions from registration under the Investment Company Act, changes in real estate","page_number":97,"box":{"x":70,"y":657,"width":838,"height":11}},{"id":"86dd1bc8-070e-4b4d-bd0d-dc2e383cb76e","block_type":"box","text":"taxes and other operating expenses, adverse changes in governmental rules and fiscal policies, adverse changes in","page_number":97,"box":{"x":68,"y":672,"width":826,"height":11}},{"id":"33ca71fa-5a8a-4ee6-84a0-bd31d5b305ca","block_type":"box","text":"zoning laws and other factors beyond the control of the issuers of the REITs. To the extent that assets underlying a","page_number":97,"box":{"x":69,"y":687,"width":817,"height":11}},{"id":"2e338f4b-e1fa-4eec-95be-367b97b7142e","block_type":"box","text":"REIT are concentrated geographically, by proper ty type, or in cer tain other respects, these risks may be heightened.","page_number":97,"box":{"x":70,"y":703,"width":822,"height":11}},{"id":"f6ebc7d1-ac41-4588-8da7-8aa8c07efd4e","block_type":"box","text":"In addition, distributions received by a Fund from REITs may consist of dividends, capital gains and/or return of","page_number":97,"box":{"x":70,"y":717,"width":792,"height":12}},{"id":"078ab7e4-b1fa-4c41-a76c-7561f4773cf5","block_type":"box","text":"capital. As REITs generally pay a higher rate of dividends (on a pre-tax basis) than operating companies, to the extent","page_number":97,"box":{"x":69,"y":732,"width":834,"height":12}},{"id":"a13f3a8b-7a51-47ed-be9e-74fe5c9dfdb5","block_type":"box","text":"application of the Fund’s investment strategy results in the Fund investing in REIT shares, the percentage of the","page_number":97,"box":{"x":69,"y":748,"width":798,"height":11}},{"id":"fa0c0299-64a8-4daa-80c6-43faf9940db8","block_type":"box","text":"Fund’s dividend income received from REIT shares will likely exceed the percentage of the Fund’s por tfolio which is","page_number":97,"box":{"x":70,"y":763,"width":818,"height":11}},{"id":"b509b7f0-68f2-42ca-9107-bf1409a5373d","block_type":"box","text":"comprised of REIT shares. Ordinary REIT dividends received by the Fund and distributed to the Fund’s shareholders","page_number":97,"box":{"x":69,"y":778,"width":821,"height":11}},{"id":"0b56b37d-3b96-46ce-9c5a-379f66e3fe7c","block_type":"box","text":"will generally be taxable as ordinary income and will not constitute “qualified dividend income.” However, a non","page_number":97,"box":{"x":68,"y":793,"width":797,"height":11}},{"id":"b545e3c4-2bc5-4b52-be59-9612cf78d8e6","block_type":"box","text":"corporate taxpayer who is a direct REIT shareholder may claim a 20% “qualified business income” deduction for","page_number":97,"box":{"x":69,"y":808,"width":798,"height":11}},{"id":"eebd84a1-659a-4852-bda7-3390f0c5f3fd","block_type":"box","text":"ordinary REIT dividends, and a regulated investment company may repor t dividends as eligible for this deduction to","page_number":97,"box":{"x":69,"y":823,"width":820,"height":12}},{"id":"161105d3-63d4-439e-8694-db77e5273127","block_type":"box","text":"the extent the regulated investment company’s income is derived from ordinary REIT dividends (reduced by allocable","page_number":97,"box":{"x":68,"y":838,"width":831,"height":12}},{"id":"3a8cdec7-5fcc-49e8-bf9c-9f9ba1a9a9dc","block_type":"box","text":"regulated investment company expenses). A shareholder may treat the dividends as such provided the regulated","page_number":97,"box":{"x":69,"y":854,"width":801,"height":11}},{"id":"306777cf-f163-4c92-a148-eff2102f9a2f","block_type":"box","text":"investment company and the shareholder satisfy applicable holding period requirements.","page_number":97,"box":{"x":70,"y":869,"width":631,"height":11}},{"id":"1b35a951-6d95-4c3a-af32-c302de612b10","block_type":"box","text":"REITs (especially mor tgage REITs) are also subject to interest rate risk. Rising interest rates may cause REIT","page_number":97,"box":{"x":102,"y":891,"width":772,"height":12}},{"id":"c669b3e6-c489-4846-82f1-e8e31a612093","block_type":"box","text":"investors to demand a higher annual yield, which may, in turn, cause a decline in the market price of the equity","page_number":97,"box":{"x":70,"y":906,"width":790,"height":12}},{"id":"4c169c7e-fad9-4ffd-a4a6-1bd827d11f55","block_type":"box","text":"II-66","page_number":97,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"9d119959-988c-4d00-9fb5-f551b49cda63","block_type":"box","text":"NM1026U-5982568-97/232","page_number":97,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"8bfa70d5-5b31-4e48-b404-e7e764d292f7","block_type":"box","text":"securities issued by a REIT. Rising interest rates also generally increase the costs of obtaining financing, which could","page_number":98,"box":{"x":69,"y":45,"width":834,"height":11}},{"id":"2d3e57f0-ab9f-4138-a589-962b9c90d176","block_type":"box","text":"cause the value of a Fund’s REIT investments to decline. During periods when interest rates are declining, mor tgages","page_number":98,"box":{"x":69,"y":60,"width":837,"height":11}},{"id":"2ba84e35-06b5-4a3a-87a6-85dff0e07e8f","block_type":"box","text":"are often refinanced. Refinancing may reduce the yield on investments in mor tgage REITs. In addition, since REITs","page_number":98,"box":{"x":69,"y":75,"width":812,"height":11}},{"id":"4ec48727-cf8e-41c4-8abc-92aec137122f","block_type":"box","text":"depend on payment under their mor tgage loans and leases to generate cash to make distributions to their","page_number":98,"box":{"x":69,"y":90,"width":759,"height":11}},{"id":"41af4e64-96f1-404c-8854-56e8d9a1e679","block_type":"box","text":"shareholders, investments in REITs may be adversely affected by defaults on such mor tgage loans or leases.","page_number":98,"box":{"x":69,"y":105,"width":778,"height":11}},{"id":"ac09f629-0011-4301-88b6-e86ea605ca0a","block_type":"box","text":"Investing in cer tain REITs, which often have small market capitalizations, may also involve the same risks as","page_number":98,"box":{"x":102,"y":128,"width":773,"height":11}},{"id":"f3f01956-1a5e-49f0-8fc8-19fcd727b1f2","block_type":"box","text":"investing in other small capitalization companies. REITs may have limited financial resources and their securities may","page_number":98,"box":{"x":70,"y":143,"width":836,"height":11}},{"id":"cff74ac7-ee8d-4e7c-bbf8-9961c2f64f96","block_type":"box","text":"trade less frequently and in limited volume and may be subject to more abrupt or erratic price movements than larger","page_number":98,"box":{"x":68,"y":158,"width":839,"height":11}},{"id":"344a7d55-da27-485a-b2d5-d6e5888fabec","block_type":"box","text":"company securities. Historically, small capitalization stocks, such as REITs, have been more volatile in price than the","page_number":98,"box":{"x":69,"y":173,"width":832,"height":11}},{"id":"20362051-a744-48b2-be27-d20f420907c8","block_type":"box","text":"larger capitalization stocks such as those included in the S&P 500 Index. The management of a REIT may be subject","page_number":98,"box":{"x":70,"y":188,"width":832,"height":12}},{"id":"8c7296f1-874a-41c6-8929-cb63dd50fedd","block_type":"box","text":"to conflicts of interest with respect to the operation of the business of the REIT and may be involved in real estate","page_number":98,"box":{"x":68,"y":203,"width":815,"height":12}},{"id":"80b54187-291d-4522-af39-126ee5955a31","block_type":"box","text":"activities competitive with the REIT. REITs may own proper ties through joint ventures or in other circumstances in","page_number":98,"box":{"x":69,"y":219,"width":804,"height":11}},{"id":"36dc6404-f2d7-452e-9b39-7fa79129923a","block_type":"box","text":"which the REIT may not have control over its investments. REITs may incur significant amounts of leverage.","page_number":98,"box":{"x":68,"y":234,"width":761,"height":11}},{"id":"997aa979-31c7-45d0-ae6a-ae3b1a8cac5c","block_type":"box","text":"Market Risks/Recent Market Events.","page_number":98,"box":{"x":102,"y":256,"width":275,"height":11}},{"id":"fe053365-3f06-4e79-a4f3-982741f98c11","block_type":"box","text":"Securities may decline in value due to factors affecting securities","page_number":98,"box":{"x":383,"y":256,"width":466,"height":12}},{"id":"8d57d047-62e6-4bd7-83e9-9b5168627577","block_type":"box","text":"markets generally or par ticular industries represented in the markets. The value of a security may decline due to","page_number":98,"box":{"x":69,"y":271,"width":801,"height":12}},{"id":"4611ab57-a0ed-43e8-9b5a-da12e30bac50","block_type":"box","text":"general market conditions, economic trends or events that are not specifically related to a company or to factors that","page_number":98,"box":{"x":68,"y":286,"width":837,"height":12}},{"id":"2e5dd0e6-68bf-42e2-8d75-60b93500a64a","block_type":"box","text":"affect a par ticular industry or industries, or factors that affect a par ticular issuer or issuers, exchange, country,","page_number":98,"box":{"x":69,"y":302,"width":795,"height":11}},{"id":"55f2fcda-8400-49b0-b98b-20707a445b7e","block_type":"box","text":"group of countries, region, market, industry, group of industries, sector or asset class. The success of a Fund’s","page_number":98,"box":{"x":68,"y":317,"width":796,"height":11}},{"id":"b120f073-311d-48ad-8191-3de347786916","block_type":"box","text":"activities could be affected by interest rates, availability of credit, inflation rates, economic uncer tainty, changes in","page_number":98,"box":{"x":69,"y":332,"width":817,"height":11}},{"id":"3503628c-56a7-4779-9f4a-5d751e429d96","block_type":"box","text":"laws, trade barriers, economic sanctions, currency exchange controls, and local, regional or global events such as","page_number":98,"box":{"x":70,"y":347,"width":812,"height":11}},{"id":"2b84c949-6404-4638-880c-5c7d325ed5c8","block_type":"box","text":"war, acts of terrorism, natural and environmental disasters, the spread of infectious illness or other public health","page_number":98,"box":{"x":68,"y":362,"width":807,"height":11}},{"id":"f540ec83-2536-4e80-8e0a-11ae2d60ffa9","block_type":"box","text":"issues, recessions, or other events could have a significant impact on a Fund and its investments. During a general","page_number":98,"box":{"x":70,"y":377,"width":822,"height":12}},{"id":"bf3bf64d-b684-4b3a-9c05-6d4c8bc2c74a","block_type":"box","text":"economic downturn in the securities markets, multiple asset classes may be negatively affected. These factors may","page_number":98,"box":{"x":69,"y":392,"width":828,"height":12}},{"id":"1026db6b-8695-4024-9d54-3eb1849975b4","block_type":"box","text":"affect the level and volatility of securities prices and the liquidity of a Fund’s investments, which could impair the","page_number":98,"box":{"x":69,"y":407,"width":804,"height":12}},{"id":"0de5ff20-87fc-4698-83f2-3a55897d90bd","block_type":"box","text":"Fund’s profitability or result in losses. A Fund may maintain substantial trading positions that can be adversely","page_number":98,"box":{"x":70,"y":423,"width":787,"height":11}},{"id":"51db3efe-13d0-4aa4-828d-44160a287f93","block_type":"box","text":"affected by the level of volatility in the financial markets; the larger the positions, the greater the potential for loss.","page_number":98,"box":{"x":69,"y":438,"width":819,"height":11}},{"id":"9d480cca-281c-4b6e-a0a1-0b7d5dd71db4","block_type":"box","text":"Unpredictable or unstable market conditions may result in reduced oppor tunities to find suitable investments to","page_number":98,"box":{"x":70,"y":453,"width":796,"height":11}},{"id":"6f3b7206-5f48-485b-a16b-c77bd02372f4","block_type":"box","text":"deploy capital or make it more difficult to exit and realize value from a Fund’s existing investments. It is impor tant to","page_number":98,"box":{"x":69,"y":468,"width":832,"height":11}},{"id":"78a36920-c1e4-4090-9ea5-3c33e9fb7bb4","block_type":"box","text":"understand that a Fund can incur material losses even if it reacts quickly to difficult market conditions and there can","page_number":98,"box":{"x":69,"y":483,"width":831,"height":11}},{"id":"87d41527-fb3e-40f9-b4e7-ccaca44112b8","block_type":"box","text":"be no assurance that a Fund will not suffer material adverse effects from broad and rapid changes in market","page_number":98,"box":{"x":69,"y":498,"width":776,"height":11}},{"id":"cdc614ea-d966-4a5a-83b7-5ac71d91686e","block_type":"box","text":"conditions.","page_number":98,"box":{"x":69,"y":514,"width":76,"height":8}},{"id":"e5f8a994-e89b-45e6-95b1-ade7c92c2ba3","block_type":"box","text":"Periods of unusually high volatility in the financial markets and restrictive credit conditions, sometimes limited to","page_number":98,"box":{"x":102,"y":536,"width":802,"height":11}},{"id":"d2402a88-72e0-4578-a255-12c8aae9960f","block_type":"box","text":"a par ticular sector or a geography, can occur. Some countries, including the United States, have adopted and/or are","page_number":98,"box":{"x":69,"y":551,"width":829,"height":11}},{"id":"e62e0003-fd55-47df-b26c-c533dd7cdebb","block_type":"box","text":"considering the adoption of more protectionist trade policies, a move away from the tighter financial industry","page_number":98,"box":{"x":69,"y":566,"width":775,"height":11}},{"id":"2ff160ee-8e30-4fe9-8bb2-c5aeed4d5aa9","block_type":"box","text":"regulations that followed the financial crisis of 2008, and/or substantially reducing corporate taxes. The exact shape","page_number":98,"box":{"x":69,"y":581,"width":833,"height":12}},{"id":"8bd7f404-6ecf-42e3-a85f-ae7b776cd5d4","block_type":"box","text":"of these policies is still being considered, but the equity and debt markets may react strongly to expectations of","page_number":98,"box":{"x":69,"y":596,"width":799,"height":12}},{"id":"0604e238-8b25-4e8c-b494-6381cbe8a2c8","block_type":"box","text":"change, which could increase volatility, especially if the market’s expectations are not borne out. A rise in","page_number":98,"box":{"x":69,"y":612,"width":751,"height":11}},{"id":"c6af5a80-bea0-44a2-a64f-8f3751fc71ee","block_type":"box","text":"protectionist trade policies, and the possibility of changes to some international trade agreements, could affect the","page_number":98,"box":{"x":70,"y":627,"width":822,"height":11}},{"id":"f4564d50-2b03-4412-a611-ba7835b101b1","block_type":"box","text":"economies of many nations in ways that cannot necessarily be foreseen at the present time. In addition, geopolitical","page_number":98,"box":{"x":69,"y":642,"width":831,"height":11}},{"id":"33c9822b-681a-452a-80f2-1815176967c4","block_type":"box","text":"and other risks, including environmental and public health, may add to instability in world economies and markets","page_number":98,"box":{"x":69,"y":657,"width":810,"height":11}},{"id":"85e74f1e-1847-4659-a782-6a413b105539","block_type":"box","text":"generally. Economies and financial markets throughout the world are increasingly interconnected. As a result, whether","page_number":98,"box":{"x":68,"y":672,"width":841,"height":11}},{"id":"9d64d057-9f62-42a1-a49a-b8266088dc36","block_type":"box","text":"or not a Fund invests in securities of issuers located in or with significant exposure to countries experiencing","page_number":98,"box":{"x":69,"y":687,"width":775,"height":11}},{"id":"f993ef03-bff4-454d-bf94-fc93732f5130","block_type":"box","text":"economic, political and/or financial difficulties, the value and liquidity of the Fund’s investments may be negatively","page_number":98,"box":{"x":69,"y":702,"width":818,"height":12}},{"id":"be5a8c08-e6ab-4bd5-9545-03b9da6a42b6","block_type":"box","text":"affected by such events.","page_number":98,"box":{"x":69,"y":717,"width":173,"height":12}},{"id":"b67b725d-3ec5-4853-96e2-1fd824d9025f","block_type":"box","text":"Governments and regulators may take actions that affect the regulation of the Fund or the instruments in which","page_number":98,"box":{"x":102,"y":740,"width":795,"height":11}},{"id":"755e8fe3-c26c-4aff-b32a-76a7459d9b9a","block_type":"box","text":"the Fund invests, or the issuers of such instruments, in ways that are unforeseeable. Future legislation or regulation","page_number":98,"box":{"x":68,"y":755,"width":830,"height":11}},{"id":"824e7294-ba70-44b8-abd0-2c5c983e09c4","block_type":"box","text":"or other governmental actions could limit or preclude the Fund’s abilities to achieve its investment objectives or","page_number":98,"box":{"x":69,"y":771,"width":796,"height":11}},{"id":"a7045ced-980b-464e-9477-448a6e87ead8","block_type":"box","text":"otherwise adversely impact an investment in the Fund. Recent policy initiatives under taken by the U.S. government","page_number":98,"box":{"x":69,"y":786,"width":820,"height":11}},{"id":"885d98d3-826e-4e25-afaa-fc99eb6f2c23","block_type":"box","text":"have the potential to impact international relations, trade agreements and the overall regulatory environment in ways","page_number":98,"box":{"x":69,"y":801,"width":833,"height":11}},{"id":"c38ff334-a6b2-48cd-af23-11eef5c3b318","block_type":"box","text":"that could create uncer tainty and instability in domestic and global markets and could adversely affect the","page_number":98,"box":{"x":68,"y":816,"width":759,"height":11}},{"id":"eece2d5e-c28a-4faa-840f-4c4630c50e77","block_type":"box","text":"investment per formance of the Fund. In par ticular, actions taken by the U.S. government in respect of international","page_number":98,"box":{"x":70,"y":831,"width":819,"height":11}},{"id":"cecea536-f1b0-4cae-a962-11d6cd66a790","block_type":"box","text":"trade relations could lead to trade wars, increased costs for impor ted goods, disruptions in supply chains, reduced","page_number":98,"box":{"x":68,"y":846,"width":821,"height":11}},{"id":"63da3210-ee6e-4658-a768-72a38a8413f0","block_type":"box","text":"foreign investment, and instability in regions where the Fund invests. Political and diplomatic events within the United","page_number":98,"box":{"x":68,"y":861,"width":837,"height":11}},{"id":"4f6cf305-5f20-4a36-9b8b-1fff3704f67d","block_type":"box","text":"States, including a contentious domestic political environment, changes in political par ty control of one or more","page_number":98,"box":{"x":69,"y":876,"width":795,"height":11}},{"id":"ecc1545c-1d15-49a7-acf0-29c8a19fdbe5","block_type":"box","text":"branches of the U.S. Government, the U.S. Government’s inability at times to agree on a long-term budget and deficit","page_number":98,"box":{"x":69,"y":891,"width":836,"height":12}},{"id":"04312894-db74-412b-9f96-c4b6dbf4c596","block_type":"box","text":"reduction plan, the threat of a U.S. Government shutdown, and disagreements over, or threats not to increase, the","page_number":98,"box":{"x":69,"y":906,"width":817,"height":12}},{"id":"248765ab-c12a-4a3c-9ba3-0dfec7be9d62","block_type":"box","text":"II-67","page_number":98,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"5de632e8-0f82-46d0-8a1b-f245d3f6ba13","block_type":"box","text":"NM1026U-5982568-98/232","page_number":98,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"f738882b-4d3b-41cd-97b3-0091402ee6de","block_type":"box","text":"U.S. Government’s borrowing limit (or “debt ceiling”), as well as political and diplomatic events abroad, may affect","page_number":99,"box":{"x":70,"y":45,"width":816,"height":11}},{"id":"31c9560d-7947-4614-bf7b-31b93e3b242c","block_type":"box","text":"investor and consumer confidence and may adversely impact financial markets and the broader economy, perhaps","page_number":99,"box":{"x":70,"y":60,"width":813,"height":11}},{"id":"e45676f3-3e57-47d6-b3df-0fbdc22ac0e9","block_type":"box","text":"suddenly and to a significant degree. A downgrade of the ratings of U.S. Government debt obligations, or concerns","page_number":99,"box":{"x":69,"y":75,"width":815,"height":11}},{"id":"95b21c48-8a03-4f62-addc-7369b235319f","block_type":"box","text":"about the U.S. Government’s credit quality in general, could have a substantial negative effect on the U.S. and global","page_number":99,"box":{"x":69,"y":90,"width":836,"height":11}},{"id":"156bcc73-9e11-4e56-bd50-980a3376b790","block_type":"box","text":"economies. For example, concerns about the U.S. Government’s credit quality may cause increased volatility in the","page_number":99,"box":{"x":69,"y":105,"width":820,"height":11}},{"id":"48823cd8-cf81-4128-8f18-5570ce3023b4","block_type":"box","text":"stock and bond markets, higher interest rates, reduced prices and liquidity of U.S. Treasury securities, and/or","page_number":99,"box":{"x":69,"y":120,"width":785,"height":12}},{"id":"6b6d60b2-c75c-4e9f-bf55-982a29c56233","block_type":"box","text":"increased costs of various kinds of debt. Moreover, although the U.S. Government has honored its credit obligations,","page_number":99,"box":{"x":70,"y":135,"width":832,"height":12}},{"id":"432f1130-29fe-4436-9940-577f93e27932","block_type":"box","text":"there remains a possibility that the United States could default on its obligations. The consequences of such an","page_number":99,"box":{"x":68,"y":150,"width":799,"height":12}},{"id":"3d48b110-98a4-4c9e-9849-6394f62069c5","block_type":"box","text":"unprecedented event are impossible to predict, but it is likely that a default by the United States would be highly","page_number":99,"box":{"x":69,"y":166,"width":802,"height":11}},{"id":"9abb45ab-41ed-4ff8-af68-512f37eb9ae6","block_type":"box","text":"disruptive to the U.S. and global securities markets and could significantly impair the value of the Fund’s","page_number":99,"box":{"x":69,"y":181,"width":746,"height":11}},{"id":"183d9f24-0baf-421a-b291-dfdc71807bef","block_type":"box","text":"investments.","page_number":99,"box":{"x":70,"y":196,"width":89,"height":9}},{"id":"75ca064a-98c7-4e52-adeb-2bd58551083f","block_type":"box","text":"The COVID-19 pandemic resulted in significant market volatility, exchange suspensions and closures, declines in","page_number":99,"box":{"x":101,"y":218,"width":802,"height":12}},{"id":"f3b3b94c-483d-43fc-ab9f-271d46347373","block_type":"box","text":"global financial markets, higher default rates, supply chain disruptions, and a substantial economic downturn in","page_number":99,"box":{"x":68,"y":234,"width":796,"height":11}},{"id":"a67d4934-a012-46f9-a5e6-99da78a70ef9","block_type":"box","text":"economies throughout the world. The impact of this coronavirus, and other epidemics and pandemics that may arise","page_number":99,"box":{"x":69,"y":249,"width":830,"height":11}},{"id":"99df36c8-4b4e-455e-babe-47d72c4fbd47","block_type":"box","text":"in the future, could affect the economies of many nations, individual companies and the market in general in ways","page_number":99,"box":{"x":70,"y":264,"width":813,"height":11}},{"id":"034096e4-ee78-4544-ada9-62998a72472d","block_type":"box","text":"that cannot necessarily be foreseen at the present time. These health crises may be shor t term or long term, and","page_number":99,"box":{"x":68,"y":279,"width":812,"height":11}},{"id":"5af1c8d4-d065-401b-b3ab-1bedeaad1e21","block_type":"box","text":"may exacerbate other pre-existing political, social and economic risks, disrupt normal market conditions and","page_number":99,"box":{"x":69,"y":294,"width":771,"height":11}},{"id":"ea34af07-0aa6-4f19-8fa3-11c694484472","block_type":"box","text":"operations, and negatively impact per formance. In addition, the impact of infectious diseases in emerging developing","page_number":99,"box":{"x":69,"y":309,"width":837,"height":11}},{"id":"527698c0-71e4-4038-9e0f-54c2767b80f4","block_type":"box","text":"or emerging market countries may be greater due to less established health care systems.","page_number":99,"box":{"x":69,"y":325,"width":646,"height":11}},{"id":"2852e458-4209-4d29-b8bc-f6173d9aaffb","block_type":"box","text":"Legal and Regulatory Risks.","page_number":99,"box":{"x":102,"y":347,"width":197,"height":11}},{"id":"edb5423c-9422-4488-ad51-b41b7f5a1656","block_type":"box","text":"The Manager is par t of a larger firm with multiple business lines active in multiple","page_number":99,"box":{"x":305,"y":347,"width":583,"height":11}},{"id":"9633aa7a-6af6-4e96-902d-b2db27d3b012","block_type":"box","text":"jurisdictions that are governed by a multitude of legal systems and regulatory regimes, some of which are new and","page_number":99,"box":{"x":67,"y":362,"width":819,"height":11}},{"id":"d1b809d6-ccb8-4352-8428-5f35c8845e67","block_type":"box","text":"evolving. As a result, the Funds and the Manager and its affiliates are subject to extensive and sophisticated legal,","page_number":99,"box":{"x":69,"y":377,"width":820,"height":12}},{"id":"c4d4e392-6ebd-472f-96a9-91392bb6402b","block_type":"box","text":"tax and regulatory risks, including changing laws and regulations, developing interpretations of such laws and","page_number":99,"box":{"x":68,"y":392,"width":781,"height":12}},{"id":"76810eee-d5da-4f8a-a07b-a02337dd981c","block_type":"box","text":"regulations, as well as existing laws, and increased scrutiny by regulators and law enforcement authorities.","page_number":99,"box":{"x":69,"y":407,"width":763,"height":12}},{"id":"b3b36cee-f8a8-462a-921c-86449685614f","block_type":"box","text":"Unexpected economic, political, regulatory and diplomatic events within the United States and abroad can trigger new","page_number":99,"box":{"x":70,"y":423,"width":838,"height":11}},{"id":"4878d41f-31e1-42fc-bab2-17a8be3bb743","block_type":"box","text":"and complex regulations that the Manager and/or the Funds may need to comply with. The implementation of","page_number":99,"box":{"x":69,"y":438,"width":781,"height":11}},{"id":"43cfc5f8-73ec-428a-8e6b-e71b80134082","block_type":"box","text":"changes to comply with current and/or new regulations applicable to the Funds and/or the Manager could have a","page_number":99,"box":{"x":69,"y":453,"width":807,"height":11}},{"id":"0ea73293-6f57-487c-bf1f-c66d57b3561f","block_type":"box","text":"material adverse effect on the Funds (including by imposing material costs on the Funds, reducing profit margins,","page_number":99,"box":{"x":69,"y":468,"width":807,"height":11}},{"id":"6e36c338-9716-44ab-8248-c6e97b3ab09d","block_type":"box","text":"reducing investment oppor tunities or by otherwise restricting the Funds and/or the Manager).","page_number":99,"box":{"x":69,"y":483,"width":666,"height":11}},{"id":"f22b63b7-281b-4a07-8b15-5d79ccd6d4e4","block_type":"box","text":"Tariff and Trade Policy Risks.","page_number":99,"box":{"x":103,"y":506,"width":202,"height":11}},{"id":"8c1432c2-850b-4475-a7a2-d8f275946d0f","block_type":"box","text":"Some countries, including the U.S., have adopted more protectionist trade policies.","page_number":99,"box":{"x":312,"y":506,"width":593,"height":11}},{"id":"56ddcfcc-6e21-45ed-9507-5467eeca1868","block_type":"box","text":"The U.S. government recently altered its approach to international trade policy, resulting in significant impacts on","page_number":99,"box":{"x":68,"y":521,"width":806,"height":11}},{"id":"2d25ba92-8171-4151-83a1-46d893263e42","block_type":"box","text":"international trade relations, cer tain tax and immigration policies, and other aspects of the national and international","page_number":99,"box":{"x":70,"y":536,"width":833,"height":11}},{"id":"64104034-5eb9-4ee8-92ac-ae1d590581b3","block_type":"box","text":"political and financial landscape. The rise in protectionist trade policies, slowing economic growth, changes to some","page_number":99,"box":{"x":70,"y":551,"width":827,"height":11}},{"id":"f42e0934-5d1b-4ad0-ac6b-489e13152977","block_type":"box","text":"major international trade agreements, risks associated with trade agreements between the U.S. and the European","page_number":99,"box":{"x":69,"y":566,"width":814,"height":11}},{"id":"ce823369-0f06-4a3f-a415-b8b60c24ec99","block_type":"box","text":"Union, and the risks associated with trade negotiations between the U.S. and China, could affect the economies of","page_number":99,"box":{"x":70,"y":581,"width":821,"height":12}},{"id":"02651689-0981-4e3f-9403-16508dea3b33","block_type":"box","text":"many nations in ways that cannot necessarily be foreseen at the present time.","page_number":99,"box":{"x":69,"y":596,"width":559,"height":12}},{"id":"b28091e9-c1ad-47e3-a24f-13de8832cad9","block_type":"box","text":"Global trade disruption, significant introductions of trade barriers, and bilateral trade frictions, together with any","page_number":99,"box":{"x":102,"y":619,"width":796,"height":11}},{"id":"ce16ebcc-6c20-4ae4-8ada-6c98c58d3c24","block_type":"box","text":"future downturns in the global economy resulting therefrom, could adversely affect the financial per formance of a","page_number":99,"box":{"x":68,"y":634,"width":809,"height":12}},{"id":"0dcd2c6d-4ca0-47f4-831f-ddb4f29dd900","block_type":"box","text":"Fund and its investments. Trade policy may be an ongoing source of instability, potentially resulting in significant","page_number":99,"box":{"x":70,"y":649,"width":799,"height":12}},{"id":"f1c72746-1c7f-40e1-9236-769a4f1ebddc","block_type":"box","text":"currency fluctuations and/or having other adverse effects on international markets, international trade agreements,","page_number":99,"box":{"x":69,"y":664,"width":823,"height":12}},{"id":"54d43f26-6568-454c-9c8e-35386e890ae5","block_type":"box","text":"and/or other existing cross-border cooperation arrangements (whether economic, tax, fiscal, legal, regulatory, or","page_number":99,"box":{"x":69,"y":680,"width":801,"height":11}},{"id":"8d1b6cb0-7883-4664-b549-3d424ace3708","block_type":"box","text":"otherwise). To the extent trade disputes escalate globally, there could be additional significant impacts on the","page_number":99,"box":{"x":69,"y":695,"width":783,"height":11}},{"id":"85917f3d-9895-4525-9cf1-41af2861ffe0","block_type":"box","text":"sectors or industries in which a Fund invests and other adverse impacts on a Fund’s overall per formance.","page_number":99,"box":{"x":69,"y":710,"width":753,"height":11}},{"id":"6d851ce0-bce9-4a2f-991d-32ed585f1b89","block_type":"box","text":"Geographic Risks","page_number":99,"box":{"x":102,"y":733,"width":123,"height":11}},{"id":"b484e6e9-e212-4de1-a983-e3565516eb12","block_type":"box","text":". Some of the companies in which the Fund invests may be located in, or otherwise connected","page_number":99,"box":{"x":226,"y":732,"width":671,"height":12}},{"id":"5aee1143-9781-4aa6-b751-df7ff2a7e26d","block_type":"box","text":"to, par ts of the world affected by natural disasters such as severe heat, ear thquakes, tornadoes, volcanic eruptions,","page_number":99,"box":{"x":68,"y":748,"width":835,"height":11}},{"id":"0e4dd872-2a65-4746-9e41-dca8ecc0013a","block_type":"box","text":"wildfires, droughts, floods, hurricanes or tsunamis, and are economically sensitive to environmental events. In","page_number":99,"box":{"x":68,"y":763,"width":787,"height":11}},{"id":"4bafb928-0eaa-43be-9df1-93a5f25c9ffa","block_type":"box","text":"addition, issuers may be impacted by security concerns with respect to a country or region, such as war and other","page_number":99,"box":{"x":69,"y":778,"width":814,"height":11}},{"id":"73a2030a-6f9b-4d4b-8fc1-5ec7c22cd2e0","block_type":"box","text":"types of conflict, terrorism, strained international relations and territorial disputes. Any of these events may adversely","page_number":99,"box":{"x":68,"y":793,"width":840,"height":11}},{"id":"16a7e269-3325-45d8-8d8e-673cf30e3ba5","block_type":"box","text":"affect the issuers, markets and economies to which a Fund is exposed, which may adversely affect the value of the","page_number":99,"box":{"x":69,"y":808,"width":824,"height":11}},{"id":"0563cd46-fdf9-4055-ba0c-5379737f23fb","block_type":"box","text":"Fund.","page_number":99,"box":{"x":70,"y":823,"width":36,"height":9}},{"id":"e4182ff5-8b21-45c9-bd8a-3bfb888a8181","block_type":"box","text":"Reference Rate Replacement Risk.","page_number":99,"box":{"x":102,"y":846,"width":255,"height":11}},{"id":"00f30c10-4062-4455-95ae-c865e1d5ccb1","block_type":"box","text":"A Fund’s investments, payment obligations and financing terms may be","page_number":99,"box":{"x":363,"y":846,"width":508,"height":11}},{"id":"d96191f6-1932-43a4-aec4-acaa6c22a92b","block_type":"box","text":"based on floating rates, such as the Secured Overnight Financing Rate (“SOFR”), Sterling Overnight Interbank Average","page_number":99,"box":{"x":69,"y":861,"width":839,"height":11}},{"id":"df6858c2-32b7-4eb3-b4ba-4a27a561f9ef","block_type":"box","text":"Rate (“SONIA”), and other similar types of reference rates (“Reference Rates”). The elimination of a Reference Rate","page_number":99,"box":{"x":70,"y":876,"width":825,"height":11}},{"id":"36992c0d-c261-4bcf-8726-7c319d17c59d","block_type":"box","text":"or any other changes or reforms to the determination or supervision of a Reference Rate could have an adverse","page_number":99,"box":{"x":69,"y":891,"width":797,"height":12}},{"id":"21f35868-0174-437d-bb71-3c38cc6cbfc5","block_type":"box","text":"impact on the market for, or value of, any instruments (including debt instruments and cer tain derivative instruments)","page_number":99,"box":{"x":70,"y":906,"width":837,"height":12}},{"id":"94ec6414-5c2b-45d7-b300-3418464bfda6","block_type":"box","text":"II-68","page_number":99,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"64071782-e237-4cb1-8860-303d229841ad","block_type":"box","text":"NM1026U-5982568-99/232","page_number":99,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"912c3c2d-a3b7-4bc2-ab14-afcd542ebdb8","block_type":"box","text":"or payments linked to those Reference Rates. In addition, any substitute Reference Rate and any pricing adjustments","page_number":100,"box":{"x":69,"y":45,"width":837,"height":11}},{"id":"e67a49ed-f57f-427d-8673-a3d4315d9507","block_type":"box","text":"imposed by a regulator or by counterpar ties or otherwise may adversely affect a Fund’s per formance and/or net","page_number":100,"box":{"x":70,"y":60,"width":800,"height":11}},{"id":"489f40d2-776c-4ad1-afbf-da2d2882a9c0","block_type":"box","text":"asset value. The London Interbank Offered Rate (“LIBOR”) had historically been used extensively in the U.S. and","page_number":100,"box":{"x":69,"y":75,"width":800,"height":11}},{"id":"b28622e1-a422-4db3-8a18-53c6342d29bf","block_type":"box","text":"globally as a “benchmark” or “reference rate” for various commercial and financial contracts, including corporate and","page_number":100,"box":{"x":68,"y":90,"width":836,"height":11}},{"id":"608586b1-6322-4003-b434-11e5bf028c14","block_type":"box","text":"municipal bonds, bank loans, asset-backed and mor tgage-related securities, interest rate swaps and other","page_number":100,"box":{"x":69,"y":105,"width":761,"height":11}},{"id":"d74b36b9-c7df-4946-96a4-7b2471f4bcc5","block_type":"box","text":"derivatives. Instruments in which a Fund may have historically paid interest at floating rates based on LIBOR or may","page_number":100,"box":{"x":69,"y":120,"width":824,"height":12}},{"id":"8b0a56e2-23ac-4ab6-b141-21e17d5777de","block_type":"box","text":"have been subject to interest caps or floors based on LIBOR. The Funds and issuers of instruments in which a Fund","page_number":100,"box":{"x":69,"y":135,"width":825,"height":11}},{"id":"89670c10-44fc-44fa-bf84-fa93879d3761","block_type":"box","text":"invests may have also historically obtained financing at floating rates based on LIBOR. In connection with the global","page_number":100,"box":{"x":70,"y":150,"width":822,"height":12}},{"id":"cf155a9d-ffee-4027-b7b9-a03e2a283992","block_type":"box","text":"transition away from LIBOR led by regulators and market par ticipants as a result of benchmark reforms, LIBOR was","page_number":100,"box":{"x":68,"y":166,"width":822,"height":11}},{"id":"c230c95a-81e1-452a-a229-04990acc9e5a","block_type":"box","text":"last published on a representative basis at the end of June 2023. Alternative Reference Rates to LIBOR have been","page_number":100,"box":{"x":70,"y":181,"width":817,"height":11}},{"id":"d4ce5d8d-4e79-4b7f-9a23-e49a10d8f2b6","block_type":"box","text":"established in most major currencies and markets in these alternative rates are continuing to develop (","page_number":100,"box":{"x":69,"y":196,"width":736,"height":11}},{"id":"a34058de-e524-4165-9cd7-f030e3304b3e","block_type":"box","text":"e.g.","page_number":100,"box":{"x":807,"y":197,"width":25,"height":10}},{"id":"e7784c8a-e708-4519-b62a-641f32829e74","block_type":"box","text":", SOFR for","page_number":100,"box":{"x":835,"y":196,"width":70,"height":10}},{"id":"4efdfded-082d-4739-afaf-7c0f36528cd8","block_type":"box","text":"USD-LIBOR and SONIA for GBP-LIBOR). While the transition from LIBOR has gone relatively smoothly, residual risks","page_number":100,"box":{"x":70,"y":211,"width":814,"height":11}},{"id":"a064be1f-3151-4815-885d-cb8866dd6ecd","block_type":"box","text":"associated with the transition may remain that may impact markets or par ticular investments and, as such, the full","page_number":100,"box":{"x":69,"y":226,"width":820,"height":11}},{"id":"d4bb6177-a095-4285-ae68-18b063cccdbd","block_type":"box","text":"impact of the transition on the Funds or the financial instruments in which the Funds invest cannot yet be fully","page_number":100,"box":{"x":70,"y":241,"width":784,"height":11}},{"id":"f86c3b95-944a-4135-90f7-7af1153c1e32","block_type":"box","text":"determined.","page_number":100,"box":{"x":69,"y":257,"width":84,"height":8}},{"id":"46225285-16d6-431d-8a07-879088edade9","block_type":"box","text":"SOFR is intended to be a broad measure of the cost of borrowing funds overnight in transactions that are","page_number":100,"box":{"x":102,"y":279,"width":750,"height":11}},{"id":"60b06274-487a-4e2b-9ec5-f46b84b801ab","block_type":"box","text":"collateralized by U.S. Treasury securities. SOFR is calculated based on transaction-level repo data collected from","page_number":100,"box":{"x":69,"y":294,"width":803,"height":11}},{"id":"ef7fdfb6-270d-41d2-9d89-8d77181041ad","block_type":"box","text":"various sources. For each trading day, SOFR is calculated as a volume-weighted median rate derived from such data.","page_number":100,"box":{"x":68,"y":309,"width":831,"height":11}},{"id":"1b5aa9e5-76fd-4a1b-970a-1f9446de562c","block_type":"box","text":"Because SOFR is a financing rate based on overnight secured funding transactions, it differs fundamentally from","page_number":100,"box":{"x":70,"y":324,"width":801,"height":12}},{"id":"00fe9440-635a-449e-b831-17d829124865","block_type":"box","text":"LIBOR. LIBOR is intended to be an unsecured rate that represents interbank funding costs for different shor t-term","page_number":100,"box":{"x":70,"y":339,"width":810,"height":12}},{"id":"dd900695-f023-4231-b789-779322f4cd8f","block_type":"box","text":"maturities or tenors. It is a forward-looking rate reflecting expectations regarding interest rates for the applicable","page_number":100,"box":{"x":69,"y":355,"width":803,"height":11}},{"id":"51b61361-336a-4c0f-9f15-cd4559a98a61","block_type":"box","text":"tenor. Thus, LIBOR is intended to be sensitive, in cer tain respects, to bank credit risk and to term interest rate risk.","page_number":100,"box":{"x":68,"y":370,"width":825,"height":11}},{"id":"4c788ed8-c8bf-4522-8fcb-73e364e11d34","block_type":"box","text":"In contrast, SOFR is a secured overnight rate reflecting the credit of U.S. Treasury securities as collateral. Thus, it is","page_number":100,"box":{"x":70,"y":385,"width":828,"height":11}},{"id":"5b86ac98-b375-4532-af2c-858b37dbfcf8","block_type":"box","text":"largely insensitive to credit-risk considerations and to shor t-term interest rate risks. SOFR is a transaction-based rate,","page_number":100,"box":{"x":70,"y":400,"width":838,"height":11}},{"id":"0b581f84-d6ca-40ee-9062-54b78122eab1","block_type":"box","text":"and it has been more volatile than other benchmark or market rates, such as three-month LIBOR, during cer tain","page_number":100,"box":{"x":69,"y":415,"width":796,"height":11}},{"id":"69e2c85b-f99c-4880-a2cf-3086929c3921","block_type":"box","text":"periods. For these reasons, among others, there is no assurance that SOFR, or rates derived from SOFR, will per form","page_number":100,"box":{"x":70,"y":430,"width":836,"height":11}},{"id":"a4f8d899-dd15-4e63-8555-8ec678d50953","block_type":"box","text":"in the same or similar way as LIBOR would have per formed at any time, and there is no assurance that SOFR-based","page_number":100,"box":{"x":70,"y":445,"width":824,"height":11}},{"id":"d63fdab9-f732-4cf8-9b5c-a0e7c8df965a","block_type":"box","text":"rates will be a suitable substitute for LIBOR. SOFR has a relatively limited history, having been first published in April","page_number":100,"box":{"x":69,"y":460,"width":830,"height":12}},{"id":"5f6937c2-f802-476d-a907-0ee16fbd6715","block_type":"box","text":"2018. The future per formance of SOFR, and SOFR-based Reference Rates, cannot be predicted based on SOFR’s","page_number":100,"box":{"x":69,"y":475,"width":809,"height":11}},{"id":"9efdd815-260e-4d07-a04e-fd46fc1416b1","block_type":"box","text":"history or otherwise. Levels of SOFR in the future may bear little or no relation to historical levels of SOFR, LIBOR or","page_number":100,"box":{"x":69,"y":491,"width":827,"height":11}},{"id":"210aed06-bb01-43d0-bc29-b97fc7c66532","block_type":"box","text":"other rates. There can also be no assurance that SOFR will not be discontinued or fundamentally altered in a manner","page_number":100,"box":{"x":69,"y":506,"width":835,"height":11}},{"id":"48121fa5-10fe-44fd-9499-39db2b052fba","block_type":"box","text":"that is materially adverse to the interests of the Fund.","page_number":100,"box":{"x":68,"y":521,"width":384,"height":11}},{"id":"b54a4249-ecb2-46d9-be36-6283b95a3a3c","block_type":"box","text":"In addition, interest rates or other types of rates and indices which are classified as “benchmarks” have been","page_number":100,"box":{"x":102,"y":543,"width":782,"height":12}},{"id":"7fd683a7-88b5-4ec4-9e84-b1da0df013c0","block_type":"box","text":"the subject of ongoing national and international regulatory reform, including under the European Union (“EU”)","page_number":100,"box":{"x":68,"y":559,"width":786,"height":11}},{"id":"df8172ad-1557-4710-9739-89c77c973dad","block_type":"box","text":"regulation on indices used as benchmarks in financial instruments and financial contracts (known as the","page_number":100,"box":{"x":69,"y":574,"width":746,"height":11}},{"id":"d6edbeff-2143-4aa7-8ecb-42513ebd7bfa","block_type":"box","text":"“Benchmarks Regulation”). The Benchmarks Regulation has been enacted into United Kingdom (“UK”) law by vir tue","page_number":100,"box":{"x":70,"y":589,"width":822,"height":11}},{"id":"e7225499-f981-40c5-a21c-8ac2330cd0e1","block_type":"box","text":"of the EU (Withdrawal) Act 2018 (as amended), subject to amendments made by the Benchmarks (Amendment and","page_number":100,"box":{"x":69,"y":604,"width":821,"height":11}},{"id":"a24ab791-d988-4bb9-b909-31ad4a6123cd","block_type":"box","text":"Transitional Provision) (EU Exit) Regulations 2019 (SI 2019/657) and other statutory instruments. Following the","page_number":100,"box":{"x":68,"y":619,"width":799,"height":11}},{"id":"c49b9208-1b83-4433-bdb7-a32acfa40dee","block_type":"box","text":"implementation of these reforms, the manner of administration of benchmarks has changed and may fur ther change","page_number":100,"box":{"x":70,"y":634,"width":830,"height":12}},{"id":"54055dbe-7e2c-4346-a581-bf8f608932f7","block_type":"box","text":"in the future, with the result that relevant benchmarks may per form differently than in the past, the use of","page_number":100,"box":{"x":70,"y":649,"width":757,"height":12}},{"id":"9610a029-4527-48cd-ad2b-07e7770e950f","block_type":"box","text":"benchmarks that are not compliant with the new standards by cer tain supervised entities may be restricted, and","page_number":100,"box":{"x":69,"y":665,"width":802,"height":11}},{"id":"64a8af36-be04-4823-9e4c-2d74ba0c4bab","block_type":"box","text":"cer tain benchmarks may be eliminated entirely. Such changes could cause increased market volatility and disruptions","page_number":100,"box":{"x":69,"y":680,"width":840,"height":11}},{"id":"71faae32-bae7-404e-8a3e-11ba2fdad795","block_type":"box","text":"in liquidity for instruments that rely on or are impacted by such benchmarks. Additionally, there could be other","page_number":100,"box":{"x":70,"y":695,"width":782,"height":11}},{"id":"62d0a065-d297-4480-9cea-356f9e652fe0","block_type":"box","text":"consequences which cannot be predicted.","page_number":100,"box":{"x":69,"y":710,"width":298,"height":11}},{"id":"e3a84fa3-1cb0-4569-a3b5-d7ff45e4e3a8","block_type":"box","text":"Repurchase Agreements and Purchase and Sale Contracts.","page_number":100,"box":{"x":102,"y":733,"width":432,"height":11}},{"id":"53b72de6-e70a-4b0e-8f88-077331b12fb7","block_type":"box","text":"Under repurchase agreements and purchase and","page_number":100,"box":{"x":541,"y":733,"width":347,"height":11}},{"id":"9747771e-348f-42d2-bba0-1c791f2dbc28","block_type":"box","text":"sale contracts, the other par ty agrees, upon entering into the contract with a Fund, to repurchase a security sold to","page_number":100,"box":{"x":69,"y":748,"width":821,"height":11}},{"id":"4c242714-2cbf-454b-a7c3-491d69e9b2ad","block_type":"box","text":"the Fund at a mutually agreed-upon time and price in a specified currency, thereby determining the yield during the","page_number":100,"box":{"x":68,"y":763,"width":815,"height":11}},{"id":"6442ce35-ced1-40ac-bc95-c0503579fd53","block_type":"box","text":"term of the agreement.","page_number":100,"box":{"x":68,"y":778,"width":164,"height":11}},{"id":"67c136c6-ccf1-42e4-955f-430de5a8664f","block_type":"box","text":"A purchase and sale contract differs from a repurchase agreement in that the contract arrangements stipulate","page_number":100,"box":{"x":101,"y":801,"width":788,"height":11}},{"id":"1ef0a8eb-4e0d-47ac-a6ae-9e3cddee7e3e","block_type":"box","text":"that securities are owned by the Fund and the purchaser receives any interest on the security paid during the period.","page_number":100,"box":{"x":68,"y":816,"width":831,"height":11}},{"id":"c768b27a-0a15-40e8-ae5b-37b677c4d0d8","block_type":"box","text":"In the case of repurchase agreements, the prices at which the trades are conducted do not reflect accrued interest","page_number":100,"box":{"x":70,"y":831,"width":821,"height":11}},{"id":"b67e0e38-cc29-4413-91b3-9a7b801213dd","block_type":"box","text":"on the underlying obligation; whereas, in the case of purchase and sale contracts, the prices take into account","page_number":100,"box":{"x":69,"y":846,"width":790,"height":11}},{"id":"549ccf57-788a-42e4-a472-a434b815e805","block_type":"box","text":"accrued interest. A Fund may enter into “tri-par ty” repurchase agreements. In “tri-par ty” repurchase agreements, an","page_number":100,"box":{"x":69,"y":861,"width":827,"height":11}},{"id":"223a9779-f0bf-4692-af64-3d9039151702","block_type":"box","text":"unaffiliated third-par ty custodian maintains accounts to hold collateral for the Fund and its counterpar ties and,","page_number":100,"box":{"x":69,"y":876,"width":788,"height":11}},{"id":"a9137154-17c2-4a32-9aa3-da9d8f7d9687","block_type":"box","text":"therefore, the Fund may be subject to the credit risk of those custodians.","page_number":100,"box":{"x":68,"y":891,"width":522,"height":11}},{"id":"9ff7def5-77d4-45d4-bbe1-87472061230f","block_type":"box","text":"II-69","page_number":100,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"7b1fc852-dc89-4611-923d-de1d97411101","block_type":"box","text":"NM1026U-5982568-100/232","page_number":100,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"eb089cce-db5c-4983-9121-268644458102","block_type":"box","text":"Some repurchase agreements and purchase and sale contracts are structured to result in a fixed rate of return","page_number":101,"box":{"x":102,"y":45,"width":792,"height":11}},{"id":"2b671b40-1c49-4c5e-93f6-af3380c463e1","block_type":"box","text":"insulated from market fluctuations during the term of the agreement, although such return may be affected by","page_number":101,"box":{"x":70,"y":60,"width":784,"height":11}},{"id":"47b65780-d939-4bc9-87b9-7dec86969a73","block_type":"box","text":"currency fluctuations. However, in the event of a default under a repurchase agreement or under a purchase and sale","page_number":101,"box":{"x":69,"y":75,"width":837,"height":11}},{"id":"87e118a9-5a95-4746-814d-1f58c5d9b2ee","block_type":"box","text":"contract, instead of the contractual fixed rate, the rate of return to the Fund would be dependent upon intervening","page_number":101,"box":{"x":69,"y":90,"width":812,"height":11}},{"id":"887b000b-4176-4c54-bd57-7f7fd28f26b5","block_type":"box","text":"fluctuations of the market values of the securities underlying the contract and the accrued interest on those","page_number":101,"box":{"x":68,"y":105,"width":770,"height":11}},{"id":"3589b2c3-746e-46b9-94da-66f15c8cd69f","block_type":"box","text":"securities. In such event, the Fund would have rights against the seller for breach of contract with respect to any","page_number":101,"box":{"x":69,"y":120,"width":802,"height":12}},{"id":"598367fc-b721-45f7-825b-2f3070965922","block_type":"box","text":"losses arising from market fluctuations following the default.","page_number":101,"box":{"x":70,"y":135,"width":430,"height":12}},{"id":"8f66ec58-f4a3-40e3-8a35-adffd2ac668d","block_type":"box","text":"Both types of agreement usually cover shor t periods, such as less than one week, although they may have","page_number":101,"box":{"x":102,"y":158,"width":759,"height":11}},{"id":"834d2e30-72b1-4f56-999d-474fbdfd4ac2","block_type":"box","text":"longer terms, and may be construed to be collateralized loans by the purchaser to the seller secured by the","page_number":101,"box":{"x":70,"y":173,"width":765,"height":11}},{"id":"77a63fb2-4580-4647-aa9c-9b1bf79faaac","block_type":"box","text":"securities transferred to the purchaser. In the case of a repurchase agreement, as a purchaser, a Fund’s Manager or","page_number":101,"box":{"x":69,"y":188,"width":835,"height":12}},{"id":"40d26b1d-13a4-4edf-8e49-5d5e5971e9ae","block_type":"box","text":"sub-adviser will monitor the creditwor thiness of the seller, and a Fund will require the seller to provide additional","page_number":101,"box":{"x":69,"y":203,"width":799,"height":11}},{"id":"a767536e-c394-492d-82d3-744853c836f1","block_type":"box","text":"collateral if the market value of the securities falls below the repurchase price at any time during the term of the","page_number":101,"box":{"x":69,"y":218,"width":801,"height":12}},{"id":"adee5b9e-2037-4ed4-8e5b-847945744086","block_type":"box","text":"repurchase agreement. The Fund does not have this right to seek additional collateral as a purchaser in the case of","page_number":101,"box":{"x":69,"y":234,"width":826,"height":11}},{"id":"863dd628-d64d-4317-8620-dd926e8be611","block_type":"box","text":"purchase and sale contracts. The Fund’s Manager or sub-adviser will mark-to-market daily the value of the securities.","page_number":101,"box":{"x":70,"y":249,"width":831,"height":11}},{"id":"f7b2e397-cf2c-4483-b8a9-ddf9045e7b8e","block_type":"box","text":"Securities subject to repurchase agreements (other than tri-par ty repurchase agreements) and purchase and sale","page_number":101,"box":{"x":69,"y":264,"width":810,"height":11}},{"id":"9592295e-ed2a-45c1-8b98-0307d6e7be37","block_type":"box","text":"contracts will be held by the Fund’s custodian (or sub-custodian) in the Federal Reserve/Treasury book-entry system","page_number":101,"box":{"x":69,"y":279,"width":829,"height":11}},{"id":"741e2773-8040-4e96-9f0c-3a436a564a86","block_type":"box","text":"or by another authorized securities depository.","page_number":101,"box":{"x":69,"y":294,"width":329,"height":11}},{"id":"c9b36d1a-8098-497a-9aa6-ac48dffefae7","block_type":"box","text":"In the event of default by the seller under a repurchase agreement construed to be a collateralized loan, the","page_number":101,"box":{"x":102,"y":317,"width":770,"height":11}},{"id":"0be5a9b6-a258-4a59-8e98-a904178399c2","block_type":"box","text":"underlying securities are not owned by the Fund but only constitute collateral for the seller’s obligation to pay the","page_number":101,"box":{"x":69,"y":332,"width":805,"height":11}},{"id":"4640dddf-6f9d-481f-8ce5-60d9b2558e9b","block_type":"box","text":"repurchase price. Therefore, the Fund may suffer time delays and incur costs or possible losses in connection with","page_number":101,"box":{"x":69,"y":347,"width":819,"height":11}},{"id":"6be7e08c-8b5b-4e37-ada7-37d2d7c24b5b","block_type":"box","text":"disposition of the collateral. If the seller becomes insolvent and subject to liquidation or reorganization under","page_number":101,"box":{"x":69,"y":362,"width":778,"height":11}},{"id":"65f86c13-3e61-4690-9254-b6b1f6e25118","block_type":"box","text":"applicable bankruptcy or other laws, a Fund’s ability to dispose of the underlying securities may be restricted. Finally,","page_number":101,"box":{"x":69,"y":377,"width":832,"height":12}},{"id":"8a40d74b-750d-4740-a243-01bfe53fb6cb","block_type":"box","text":"it is possible that a Fund may not be able to substantiate its interest in the underlying securities. To minimize this","page_number":101,"box":{"x":70,"y":393,"width":810,"height":11}},{"id":"19c7f3c4-595f-4057-af4d-24c5d53bd00f","block_type":"box","text":"risk, the securities underlying the repurchase agreement will be held by the applicable custodian at all times in an","page_number":101,"box":{"x":69,"y":408,"width":812,"height":11}},{"id":"1a6a6222-319b-4852-8720-fe0d9740268c","block_type":"box","text":"amount at least equal to the repurchase price, including accrued interest. If the seller fails to repurchase the","page_number":101,"box":{"x":69,"y":423,"width":778,"height":11}},{"id":"9afc9fd2-4c16-4311-bac8-b5e7f4337427","block_type":"box","text":"securities, a Fund may suffer a loss to the extent proceeds from the sale of the underlying securities are less than","page_number":101,"box":{"x":69,"y":438,"width":817,"height":11}},{"id":"454e3173-1f8a-488e-8a84-0b82d31a7c65","block_type":"box","text":"the repurchase price.","page_number":101,"box":{"x":68,"y":453,"width":151,"height":11}},{"id":"b18bfb06-b938-438b-8858-e30d3be967c6","block_type":"box","text":"In any repurchase transaction to which a Fund is a par ty, collateral for a repurchase agreement may include cash","page_number":101,"box":{"x":102,"y":475,"width":805,"height":12}},{"id":"95e854fb-5de5-4800-a8b3-384ead179daf","block_type":"box","text":"items and obligations issued by the U.S. Government or its agencies or instrumentalities. For cer tain Funds, however,","page_number":101,"box":{"x":70,"y":491,"width":837,"height":11}},{"id":"1e705b8f-7628-441b-8cd9-648d902db04c","block_type":"box","text":"collateral may include instruments other than cash items and obligations issued by the U.S. Government or its","page_number":101,"box":{"x":69,"y":506,"width":788,"height":11}},{"id":"a69c20bc-3581-4f4a-b413-d3b6244e36ec","block_type":"box","text":"agencies or instrumentalities, including securities that the Fund could not hold directly under its investment","page_number":101,"box":{"x":69,"y":521,"width":767,"height":11}},{"id":"4e8b4fbc-30b3-439c-818a-27c15af09168","block_type":"box","text":"strategies without the repurchase obligation.","page_number":101,"box":{"x":69,"y":536,"width":317,"height":11}},{"id":"d2330bc0-c196-4efa-9814-7e44e1add503","block_type":"box","text":"The type of collateral underlying repurchase agreements may also pose cer tain risks for a Fund. Lower quality","page_number":101,"box":{"x":101,"y":559,"width":782,"height":11}},{"id":"04ca6e66-ae4e-4c46-9029-8ab05211295d","block_type":"box","text":"collateral and collateral with longer maturities may be subject to greater price fluctuations than higher quality","page_number":101,"box":{"x":69,"y":574,"width":776,"height":11}},{"id":"34adbb41-6bb6-47c4-a41d-2a11be7be910","block_type":"box","text":"collateral and collateral with shor ter maturities. If the repurchase agreement counterpar ty were to default, lower","page_number":101,"box":{"x":69,"y":589,"width":799,"height":11}},{"id":"2f5ff242-80f1-4e42-93ff-582b31837e27","block_type":"box","text":"quality collateral may be more difficult to liquidate than higher quality collateral. Should the counterpar ty default and","page_number":101,"box":{"x":69,"y":604,"width":829,"height":11}},{"id":"8b28835d-a5d4-47ee-8a0d-0eaca6cdd53b","block_type":"box","text":"the amount of collateral not be sufficient to cover the counterpar ty’s repurchase obligation, a Fund would retain the","page_number":101,"box":{"x":68,"y":619,"width":825,"height":11}},{"id":"7b4aeb3b-ab38-425f-b61c-430c3cde1d24","block_type":"box","text":"status of an unsecured creditor of the counterpar ty (","page_number":101,"box":{"x":69,"y":634,"width":374,"height":11}},{"id":"6f27268a-d107-404f-b784-2b3cc3e2d6be","block_type":"box","text":"i.e.","page_number":101,"box":{"x":445,"y":634,"width":20,"height":9}},{"id":"e94b7544-2437-42a7-b3e2-ab546c9e5df1","block_type":"box","text":", the position the Fund would normally be in if it were to hold,","page_number":101,"box":{"x":468,"y":634,"width":434,"height":11}},{"id":"2569975b-ab75-42d3-8608-0482bf5b96a3","block_type":"box","text":"pursuant to its investment policies, other unsecured debt securities of the defaulting counterpar ty) with respect to","page_number":101,"box":{"x":70,"y":649,"width":813,"height":12}},{"id":"88f4c206-d7b1-4026-bc54-1c106716582c","block_type":"box","text":"the amount of the shor tfall. As an unsecured creditor, a Fund would be at risk of losing some or all of the principal","page_number":101,"box":{"x":68,"y":664,"width":816,"height":12}},{"id":"871456eb-4d6f-4b26-b3d0-234c90271806","block_type":"box","text":"and income involved in the transaction.","page_number":101,"box":{"x":69,"y":680,"width":278,"height":9}},{"id":"ea073bc8-8649-419a-bf22-0f520ad054cf","block_type":"box","text":"Regulations adopted by global prudential regulators require cer tain bank-regulated counterpar ties and cer tain of","page_number":101,"box":{"x":102,"y":702,"width":800,"height":12}},{"id":"e362311b-9038-476e-b852-ac89407bfaf2","block_type":"box","text":"their affiliates to include in cer tain financial contracts, including many repurchase agreements and purchase and sale","page_number":101,"box":{"x":68,"y":717,"width":840,"height":12}},{"id":"50d86a8f-00f6-4d0e-a53a-ffdc5ae9aefb","block_type":"box","text":"contracts, terms that delay or restrict the rights of counterpar ties, such as a Fund, to terminate such agreements,","page_number":101,"box":{"x":69,"y":732,"width":814,"height":12}},{"id":"c6465cde-9663-454e-9976-ab15531dbf56","block_type":"box","text":"take foreclosure action, exercise other default rights or restrict transfers of credit suppor t in the event that the","page_number":101,"box":{"x":68,"y":748,"width":790,"height":11}},{"id":"b3d6777d-601b-46d1-ac8e-00e2a1a95fbb","block_type":"box","text":"counterpar ty and/or its affiliates are subject to cer tain types of resolution or insolvency proceedings. It is possible","page_number":101,"box":{"x":69,"y":763,"width":818,"height":11}},{"id":"00ede364-ad86-4e72-8cbc-d8f522da1e90","block_type":"box","text":"that these requirements, as well as potential additional government regulation and other developments in the","page_number":101,"box":{"x":68,"y":778,"width":783,"height":11}},{"id":"b4ec55ab-7b20-40e4-83fe-56a1b939e529","block_type":"box","text":"market, could adversely affect a Fund’s ability to terminate existing repurchase agreements and purchase and sale","page_number":101,"box":{"x":69,"y":793,"width":821,"height":11}},{"id":"7c6d4f59-b3a1-4aea-8ffc-392d93ea04a0","block_type":"box","text":"contracts or to realize amounts to be received under such agreements. The SEC has also finalized rules that will","page_number":101,"box":{"x":69,"y":808,"width":800,"height":11}},{"id":"e74672cf-81a2-4269-9f28-77ffa19b9355","block_type":"box","text":"require cer tain transactions involving U.S. Treasuries, including repurchase agreements, to be centrally cleared.","page_number":101,"box":{"x":69,"y":823,"width":796,"height":12}},{"id":"6e6631ca-557a-49c7-adeb-fdce1dedd909","block_type":"box","text":"Compliance with these rules is expected to be required by the middle of 2027. Although the impact of these rules on","page_number":101,"box":{"x":69,"y":838,"width":834,"height":12}},{"id":"5c0e5b3a-8fe9-441e-8523-658c146bcb24","block_type":"box","text":"the Funds is difficult to predict, they may reduce the availability or increase the costs of such transactions and may","page_number":101,"box":{"x":68,"y":853,"width":824,"height":12}},{"id":"c6f2becd-4855-45b9-8a48-a8900a786296","block_type":"box","text":"adversely affect a Fund’s per formance.","page_number":101,"box":{"x":69,"y":869,"width":279,"height":11}},{"id":"663b87dd-335e-47d7-88aa-3235de51f202","block_type":"box","text":"Restricted Securities.","page_number":101,"box":{"x":102,"y":891,"width":157,"height":9}},{"id":"bff5c0bf-160a-474c-ade8-6d98e6bcf0a9","block_type":"box","text":"A Fund may invest in or hold securities that are not registered under the Securities Act","page_number":101,"box":{"x":265,"y":891,"width":617,"height":12}},{"id":"ab0ccdef-4a88-4106-b7d7-03559e1c260f","block_type":"box","text":"(“restricted securities”), which may include securities in private companies and Rule 144A Securities. Restricted","page_number":101,"box":{"x":69,"y":906,"width":801,"height":12}},{"id":"9e4a0eed-9093-498b-9fb9-e0085f08cb36","block_type":"box","text":"II-70","page_number":101,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"231412fe-73e7-4ee3-8de0-11e77ac4273a","block_type":"box","text":"NM1026U-5982568-101/232","page_number":101,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"0e963483-e5f5-4503-a33f-128bd5cdd56e","block_type":"box","text":"securities may be sold in private placement transactions between issuers and their purchasers, including through","page_number":102,"box":{"x":69,"y":45,"width":808,"height":11}},{"id":"63ba5ca1-6752-48c4-83df-668e6fb57788","block_type":"box","text":"private negotiated transactions between the issuer and their purchasers, such as the Funds, and may be neither","page_number":102,"box":{"x":70,"y":60,"width":802,"height":11}},{"id":"07224ad4-7032-4edd-9e60-11efff7e8bcd","block_type":"box","text":"listed on an exchange nor traded in other established markets. In many cases, privately placed securities may not be","page_number":102,"box":{"x":70,"y":75,"width":834,"height":11}},{"id":"1e218c96-e414-48b0-8c12-074184b81e34","block_type":"box","text":"freely transferable under the laws of the applicable jurisdiction or due to contractual restrictions on resale. Some of","page_number":102,"box":{"x":68,"y":90,"width":825,"height":11}},{"id":"50be7393-0c16-4f28-be6e-fdea68dbf2dd","block_type":"box","text":"these securities are new and complex, and trade only among institutions; the markets for these securities are still","page_number":102,"box":{"x":68,"y":105,"width":815,"height":11}},{"id":"d25c9b65-c0d7-4e09-9aba-0683848db5be","block_type":"box","text":"developing, and may not function as efficiently as established markets. Typically, investments in private companies","page_number":102,"box":{"x":69,"y":120,"width":821,"height":12}},{"id":"bdfc4da6-ad19-44c4-bd30-e040189ffc6b","block_type":"box","text":"are in restricted securities that are not traded in public markets and subject to substantial holding periods, so that a","page_number":102,"box":{"x":69,"y":136,"width":831,"height":11}},{"id":"d5c1b99e-cad6-47fd-b1a6-04ad7887af26","block_type":"box","text":"Fund may not be able to resell some of its holdings for extended periods, which may be several years. There can be","page_number":102,"box":{"x":70,"y":150,"width":824,"height":12}},{"id":"189b7da0-c76a-4a22-b097-7b6cdb53380f","block_type":"box","text":"no assurance that a Fund will be able to realize the value of such restricted securities in a timely manner or at all. As","page_number":102,"box":{"x":69,"y":166,"width":834,"height":11}},{"id":"631e076a-2f6f-4c31-a6ca-547d9a6cee64","block_type":"box","text":"a result of the absence of a public trading market and the potential bespoke nature on cer tain transactions,","page_number":102,"box":{"x":69,"y":181,"width":769,"height":11}},{"id":"d6a32abe-fce9-45e3-b238-3f221d719e20","block_type":"box","text":"restricted securities may be deemed to be illiquid investments or less liquid investments and may be more difficult to","page_number":102,"box":{"x":69,"y":196,"width":838,"height":11}},{"id":"de267fae-4be2-4c90-a3e2-46f8d06d59d0","block_type":"box","text":"value than publicly traded securities. To the extent that restricted securities may be resold in privately negotiated","page_number":102,"box":{"x":68,"y":211,"width":805,"height":11}},{"id":"aa51ea7a-929a-480f-b8ef-9a072b7c7b11","block_type":"box","text":"transactions, the prices realized from the sales, due to lack of liquidity, could be less than those originally paid by the","page_number":102,"box":{"x":68,"y":226,"width":840,"height":11}},{"id":"14a2be8c-707e-45e1-9af6-ac0b7c05f762","block_type":"box","text":"Fund or less than their fair market value. The amount of any discount may vary depending on the security type, the","page_number":102,"box":{"x":70,"y":241,"width":815,"height":11}},{"id":"757ea295-e73f-457f-860e-a38e5fc228ee","block_type":"box","text":"character of the issuer, which par ty (if any) will bear the expenses of registering the restricted security, and prevailing","page_number":102,"box":{"x":69,"y":256,"width":835,"height":12}},{"id":"a499ce15-aa07-4087-885f-a89a87e7c996","block_type":"box","text":"market conditions. In addition, issuers whose securities are not publicly traded or who are not otherwise publicly","page_number":102,"box":{"x":69,"y":272,"width":803,"height":11}},{"id":"cde650b1-a682-4359-b28f-85b89021e6f5","block_type":"box","text":"listed may not be subject to the disclosure and other investor protection requirements that may be applicable if their","page_number":102,"box":{"x":70,"y":286,"width":830,"height":12}},{"id":"b0a98d2a-b6a5-4059-b871-d39fb83a0198","block_type":"box","text":"securities were publicly traded. If any privately placed securities held by a Fund are required to be registered under","page_number":102,"box":{"x":69,"y":302,"width":817,"height":11}},{"id":"da086843-aab1-4e0e-9a85-857ae3aefc72","block_type":"box","text":"the securities laws of one or more jurisdictions before being resold, the Fund may be required to bear the expenses","page_number":102,"box":{"x":68,"y":317,"width":825,"height":11}},{"id":"edf4db15-33b9-442c-a554-fca38793d30d","block_type":"box","text":"of registration. Where registration is required for restricted securities, a considerable time period may elapse","page_number":102,"box":{"x":69,"y":332,"width":777,"height":11}},{"id":"7340cc01-e741-4f0c-b047-b01deeb9e5ff","block_type":"box","text":"between the time the Fund decides to sell the security and the time it is actually permitted to sell the security under","page_number":102,"box":{"x":69,"y":347,"width":828,"height":11}},{"id":"43a3c2cf-6c6e-4cf3-9a86-d2d9f90829aa","block_type":"box","text":"an effective registration statement. If during such period, adverse market conditions were to develop, the Fund might","page_number":102,"box":{"x":69,"y":362,"width":834,"height":11}},{"id":"ac1dc393-d3d7-40d9-9321-8a377b43dec2","block_type":"box","text":"obtain less favorable pricing terms than when it decided to sell the security. In addition, the Fund may be deemed to","page_number":102,"box":{"x":69,"y":377,"width":828,"height":12}},{"id":"b2b0d8c5-88bd-454e-8e20-d96b03750a19","block_type":"box","text":"be an “underwriter” for purposes of the Securities Act when selling restricted securities. If so, the Fund may be liable","page_number":102,"box":{"x":69,"y":392,"width":836,"height":12}},{"id":"d514196d-cf0f-4c87-8779-e191d84abbb0","block_type":"box","text":"to purchasers of the restricted securities if the registration statement prepared by the issuer, or the corresponding","page_number":102,"box":{"x":68,"y":407,"width":819,"height":12}},{"id":"31b2f32c-38dd-4a7f-b2f4-128fa70ba9a7","block_type":"box","text":"prospectus, is materially inaccurate or misleading. Transactions in restricted securities may entail other transaction","page_number":102,"box":{"x":70,"y":423,"width":822,"height":11}},{"id":"35a1286f-affc-4f79-a042-1d8ee43231b2","block_type":"box","text":"costs that are higher than those for transactions in unrestricted securities. Cer tain of the Fund’s investments in","page_number":102,"box":{"x":69,"y":438,"width":798,"height":11}},{"id":"47f7ce0a-f068-4a20-a8be-4976e8815b7f","block_type":"box","text":"private placements may consist of direct investments and may include investments in smaller, less seasoned","page_number":102,"box":{"x":70,"y":453,"width":780,"height":11}},{"id":"1bbc3882-1d6e-44c0-8152-4779e5b38238","block_type":"box","text":"issuers, which may involve greater risks. Issuers of restricted securities may not be subject to SEC repor ting","page_number":102,"box":{"x":70,"y":468,"width":773,"height":11}},{"id":"47ec8fa4-02d6-44d8-b599-84e93654d93d","block_type":"box","text":"requirements, may not be required to maintain their accounting records in accordance with generally accepted","page_number":102,"box":{"x":69,"y":483,"width":784,"height":11}},{"id":"0c01f5dc-d2df-4180-843c-ef256a0242d0","block_type":"box","text":"accounting principles, and may not be required to maintain effective internal controls over financial repor ting. As a","page_number":102,"box":{"x":69,"y":498,"width":816,"height":11}},{"id":"aa9cba9b-e6c2-4c7c-a033-e83761878d9d","block_type":"box","text":"result, BlackRock may not have timely or accurate information about the business, financial condition and results of","page_number":102,"box":{"x":69,"y":513,"width":828,"height":11}},{"id":"11a99e6c-5d24-45ae-83c3-8f3dd4e1711c","block_type":"box","text":"operations of such issuers, and investments in securities of such issuers may involve a high degree of business and","page_number":102,"box":{"x":69,"y":528,"width":831,"height":12}},{"id":"6a629b58-82ee-484e-b6ba-b0e317da36a2","block_type":"box","text":"financial risk and may result in substantial losses to the Fund. Such issuers may also have limited product lines,","page_number":102,"box":{"x":68,"y":543,"width":804,"height":12}},{"id":"b9d81662-74b5-40bd-958e-7f4f27c65691","block_type":"box","text":"markets or financial resources, or they may be dependent on a limited management group.","page_number":102,"box":{"x":69,"y":559,"width":647,"height":11}},{"id":"371b548c-6e17-4d73-a3b6-e6d9c4b4fb1f","block_type":"box","text":"Cer tain restricted securities may represent limited investment oppor tunities and each shareholder’s","page_number":102,"box":{"x":102,"y":581,"width":714,"height":11}},{"id":"29992899-5a42-4fe7-a867-85455241b7ae","block_type":"box","text":"propor tionate investment exposure to such limited investment oppor tunities may be reduced propor tionately as the","page_number":102,"box":{"x":70,"y":597,"width":823,"height":11}},{"id":"03daca18-6855-4cf9-9e66-2aa3acdb59d0","block_type":"box","text":"Fund’s net assets grow from new or additional investments made in the Fund by other shareholders. The issuer of a","page_number":102,"box":{"x":70,"y":612,"width":826,"height":11}},{"id":"08dfda16-087c-4d27-9ff1-a1a46fed4971","block_type":"box","text":"private placement may later register those shares for public sale in an IPO, but there is no guarantee that an IPO will","page_number":102,"box":{"x":70,"y":627,"width":830,"height":11}},{"id":"637f64ad-9738-44ae-be42-a2e9aa09c9ce","block_type":"box","text":"ever be completed. Even after an IPO, there may be a limited trading market for securities of that issuer, including","page_number":102,"box":{"x":69,"y":642,"width":812,"height":11}},{"id":"5bb638c7-dd88-4b9a-ad5c-4b8cc4f912a5","block_type":"box","text":"any direct investment by a Fund, or the Fund may be subject to contractual limitations on its ability to resell its","page_number":102,"box":{"x":69,"y":657,"width":787,"height":11}},{"id":"b9eba9cf-b0b8-418e-a17d-04ced5d891b0","block_type":"box","text":"existing securities following an IPO. The inability of an applicable issuer of a restricted security to complete an IPO or","page_number":102,"box":{"x":69,"y":672,"width":833,"height":11}},{"id":"18c729b2-ab12-4ef1-92d8-8d2840eb8491","block_type":"box","text":"offer other liquidity oppor tunities to the Fund and other investors will extend the holding period of a Fund’s","page_number":102,"box":{"x":69,"y":687,"width":759,"height":11}},{"id":"8b01dcbd-4288-42b5-ac18-118fdc18d890","block_type":"box","text":"investments, potentially indefinitely, and may adversely affect the value of the investments. In making investments in","page_number":102,"box":{"x":70,"y":702,"width":833,"height":12}},{"id":"46b34b63-9daf-43e4-b9a5-81afe0aea187","block_type":"box","text":"such securities, a Fund may obtain access to material nonpublic information, which may restrict the Fund’s ability to","page_number":102,"box":{"x":69,"y":717,"width":828,"height":12}},{"id":"a17cc2ab-c563-43aa-b9a5-801629a5d27f","block_type":"box","text":"conduct por tfolio transactions in such securities. The activity of identifying, completing, and realizing upon attractive","page_number":102,"box":{"x":69,"y":732,"width":827,"height":12}},{"id":"d155310c-2813-42ef-a32c-f9feff1a17b1","block_type":"box","text":"investments in restricted securities is highly competitive and involves a high degree of uncer tainty. A Fund will be","page_number":102,"box":{"x":70,"y":748,"width":804,"height":11}},{"id":"bfac7fb4-1a3f-4f22-bb95-4d65332b7e9a","block_type":"box","text":"competing for investments against other similarly situated investors. It is possible that competition for appropriate","page_number":102,"box":{"x":69,"y":763,"width":816,"height":11}},{"id":"0872f9ec-e401-4b48-95e4-054b763e65bb","block_type":"box","text":"investment oppor tunities may increase, thus potentially reducing the number of investment oppor tunities available to","page_number":102,"box":{"x":70,"y":778,"width":835,"height":11}},{"id":"ef8279d9-1da9-4577-a2ba-bdf9fcd7d58e","block_type":"box","text":"a Fund and adversely affecting the terms upon which investments can be made. There is no assurance that","page_number":102,"box":{"x":69,"y":793,"width":768,"height":11}},{"id":"be7e0825-fb7b-4f77-87c8-4fbbbfa78ca1","block_type":"box","text":"investment oppor tunities for restricted securities will be available at any given time or at a level desired by a Fund,","page_number":102,"box":{"x":70,"y":808,"width":815,"height":11}},{"id":"26be3eb8-ded7-4096-bf5e-5b647d28b84b","block_type":"box","text":"especially as that Fund grows in size.","page_number":102,"box":{"x":69,"y":823,"width":264,"height":12}},{"id":"56d28d7d-db62-47ec-a203-9a56b323b1c0","block_type":"box","text":"There may not be a readily available market value for a Fund’s restricted securities (in par ticular, restricted","page_number":102,"box":{"x":101,"y":846,"width":762,"height":11}},{"id":"24379453-9584-4b68-92f8-68a2fdbc3a21","block_type":"box","text":"securities issued by private companies) and thus they may be considered “illiquid”. Each Fund values restricted","page_number":102,"box":{"x":69,"y":861,"width":795,"height":11}},{"id":"bfa6ecc8-d27c-4663-b6d0-51152ede1bea","block_type":"box","text":"securities in accordance with BlackRock’s valuation policies and procedures, which are designed to value","page_number":102,"box":{"x":69,"y":876,"width":751,"height":11}},{"id":"cdc729f7-195d-42c3-a5e9-35ecc505f8e9","block_type":"box","text":"investments such that they accurately reflect fair value. Due to the inherent uncer tainty and subjectivity of","page_number":102,"box":{"x":70,"y":891,"width":755,"height":11}},{"id":"ba0d7f83-8b1f-47ed-ad10-40ea94e665f9","block_type":"box","text":"determining the fair value of investments that do not have a readily available market value, the fair value of a Fund’s","page_number":102,"box":{"x":69,"y":906,"width":830,"height":12}},{"id":"559fe6a7-104e-4b57-a262-8e7d87e905df","block_type":"box","text":"II-71","page_number":102,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"837639d2-daac-4171-8a9c-e427b79f6f43","block_type":"box","text":"NM1026U-5982568-102/232","page_number":102,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"d830e8fd-2317-4513-b6ac-495449067509","block_type":"box","text":"private investments may differ significantly from the values that would have been used had a readily available market","page_number":103,"box":{"x":70,"y":45,"width":835,"height":11}},{"id":"3a759c1a-6911-48fb-9535-ca9a47a8d98f","block_type":"box","text":"value existed for such investments and may differ materially from the amounts the Fund may realize on any","page_number":103,"box":{"x":68,"y":60,"width":766,"height":11}},{"id":"95586dea-253f-4eb4-8d9f-5f557ac65a73","block_type":"box","text":"dispositions of such investments. Differences in the value of the Fund’s private investments could result in the","page_number":103,"box":{"x":69,"y":75,"width":792,"height":11}},{"id":"b7adabc1-bf17-4295-bfdd-4d81d87d48c0","block_type":"box","text":"Fund’s shareholder transactions being effected at a NAV that does not accurately reflect the underlying value of the","page_number":103,"box":{"x":70,"y":90,"width":821,"height":11}},{"id":"579ff432-61f6-4d82-bddd-725ef129525b","block_type":"box","text":"Fund’s por tfolio, potentially resulting in the dilution of shareholder interests and increasing oppor tunities for","page_number":103,"box":{"x":70,"y":105,"width":771,"height":11}},{"id":"9d3a3ef2-7737-4b3f-91cc-265771778d3d","block_type":"box","text":"shareholder arbitrage. The values used by the Fund to price its restricted securities may also differ from those used","page_number":103,"box":{"x":69,"y":120,"width":826,"height":12}},{"id":"7cfb6049-293b-4bde-90d9-462bd8d9c2b1","block_type":"box","text":"by other investment companies and investors to price the same restricted securities. In addition, the impact of","page_number":103,"box":{"x":69,"y":135,"width":790,"height":11}},{"id":"b4c42b66-e44c-4f52-b0b9-c7e36a4227ab","block_type":"box","text":"changes in the market environment and other events on the fair values of a Fund’s investments that have no readily","page_number":103,"box":{"x":69,"y":150,"width":828,"height":12}},{"id":"8fea7447-fd0f-4e8d-90f0-8027c04a4cc9","block_type":"box","text":"available market values may differ from the impact of such changes on the readily available market values for the","page_number":103,"box":{"x":69,"y":166,"width":810,"height":11}},{"id":"0fbb0d8d-2144-4b5e-a47c-ddeed2f85cc2","block_type":"box","text":"Fund’s other investments. A Fund’s NAV could be adversely affected if the Fund’s determinations regarding the fair","page_number":103,"box":{"x":70,"y":181,"width":818,"height":11}},{"id":"d382897b-bc16-4b30-8932-e9e5d17f8c8d","block_type":"box","text":"value of the Fund’s investments were materially higher than the investment’s actual market or fair value or the values","page_number":103,"box":{"x":68,"y":196,"width":839,"height":11}},{"id":"1fc193a4-3dc4-4362-8d41-677c825ff922","block_type":"box","text":"that the Fund ultimately realizes upon the disposal of such investments.","page_number":103,"box":{"x":68,"y":211,"width":514,"height":11}},{"id":"9f165bf5-c40b-420b-b67d-1143064ea363","block_type":"box","text":"See also risks discussed under “Illiquid Investments.”","page_number":103,"box":{"x":102,"y":234,"width":385,"height":11}},{"id":"da1d4ed9-4b60-4196-a086-c604fd646ebe","block_type":"box","text":"Reverse Repurchase Agreements.","page_number":103,"box":{"x":102,"y":257,"width":246,"height":10}},{"id":"0322eeb0-62ea-4dd2-a0ec-e1fa0f28f16a","block_type":"box","text":"A Fund may enter into reverse repurchase agreements with the same par ties","page_number":103,"box":{"x":354,"y":257,"width":548,"height":11}},{"id":"42f2d75d-058a-4b78-9127-d3929eb06a0d","block_type":"box","text":"with whom it may enter into repurchase agreements. Under a reverse repurchase agreement, a Fund sells securities","page_number":103,"box":{"x":68,"y":272,"width":830,"height":11}},{"id":"7e3d247f-fc2d-4307-8702-93af004cf76e","block_type":"box","text":"to another par ty and agrees to repurchase them at a par ticular date and price. A Fund may enter into a reverse","page_number":103,"box":{"x":68,"y":287,"width":793,"height":11}},{"id":"9d5b195d-5ead-43aa-8562-796663cbf259","block_type":"box","text":"repurchase agreement when it is anticipated that the interest income to be earned from the investment of the","page_number":103,"box":{"x":69,"y":302,"width":784,"height":11}},{"id":"c43bb93b-61a2-4aec-9d1d-6acef91f4495","block_type":"box","text":"proceeds of the transaction is greater than the interest expense of the transaction.","page_number":103,"box":{"x":70,"y":317,"width":591,"height":11}},{"id":"4196c2aa-d7c7-401b-aaf7-81e8599fed7e","block_type":"box","text":"The use of reverse repurchase agreements may be regarded as leveraging and, therefore, speculative.","page_number":103,"box":{"x":101,"y":339,"width":730,"height":12}},{"id":"ce83c98f-1939-4ac1-a98e-98c25c7442d5","block_type":"box","text":"Fur thermore, reverse repurchase agreements involve the risks that (i) the interest income earned in the investment","page_number":103,"box":{"x":70,"y":355,"width":822,"height":11}},{"id":"d782a0eb-10e2-49fa-9210-65f354296f79","block_type":"box","text":"of the proceeds will be less than the interest expense, (ii) the market value of the securities retained in lieu of sale","page_number":103,"box":{"x":69,"y":370,"width":821,"height":11}},{"id":"b0ed5341-3569-4cc3-84c9-a0193df6b402","block_type":"box","text":"by a Fund may decline below the price of the securities the Fund has sold but is obligated to repurchase, (iii) the","page_number":103,"box":{"x":69,"y":385,"width":801,"height":11}},{"id":"7482c72f-566a-4027-825b-2f8fa7891c2d","block_type":"box","text":"market value of the securities sold will decline below the price at which the Fund is required to repurchase them and","page_number":103,"box":{"x":69,"y":400,"width":830,"height":11}},{"id":"92336e78-c9de-437d-a28f-d270a0d3e26f","block_type":"box","text":"(iv) the securities will not be returned to the Fund.","page_number":103,"box":{"x":69,"y":415,"width":354,"height":11}},{"id":"9f072bbd-faba-47f1-beed-d8496c78e670","block_type":"box","text":"In addition, if the buyer of securities under a reverse repurchase agreement files for bankruptcy or becomes","page_number":103,"box":{"x":102,"y":438,"width":769,"height":11}},{"id":"d71b5173-7051-4d94-b57c-d92b49085ac8","block_type":"box","text":"insolvent, such buyer or its trustee or receiver may receive an extension of time to determine whether to enforce a","page_number":103,"box":{"x":70,"y":453,"width":815,"height":11}},{"id":"90815ab1-edb9-4cf3-9120-55ec621d5c06","block_type":"box","text":"Fund’s obligations to repurchase the securities and the Fund’s use of the proceeds of the reverse repurchase","page_number":103,"box":{"x":70,"y":468,"width":782,"height":11}},{"id":"b1e4f2e3-f472-4e35-b0ac-e704e601995e","block_type":"box","text":"agreement may effectively be restricted pending such decision.","page_number":103,"box":{"x":69,"y":483,"width":449,"height":11}},{"id":"248fa1ee-ce49-41e4-9ce6-5587d16ecddf","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into reverse repurchase agreements and","page_number":103,"box":{"x":102,"y":506,"width":794,"height":11}},{"id":"5886f64e-81b4-4ab1-a1ef-a5f64464b7a6","block_type":"box","text":"similar financing transactions (","page_number":103,"box":{"x":69,"y":521,"width":218,"height":11}},{"id":"88369d5c-0cee-4fc9-bfc2-7f6e694304d6","block_type":"box","text":"e.g.","page_number":103,"box":{"x":289,"y":522,"width":24,"height":10}},{"id":"2f8d1e54-d333-44df-9f92-4144085db917","block_type":"box","text":", recourse and non-recourse tender option bonds, borrowed bonds) notwithstanding","page_number":103,"box":{"x":316,"y":521,"width":594,"height":11}},{"id":"f0707d25-efcd-4777-9aaa-1ed4fc7e2e50","block_type":"box","text":"the limitation on the issuance of senior securities in Section 18 of the Investment Company Act, provided that the","page_number":103,"box":{"x":68,"y":536,"width":813,"height":11}},{"id":"c679dbf1-440d-4296-afc1-caaf2e84351d","block_type":"box","text":"Fund either (i) complies with the 300% asset coverage ratio with respect to all such transactions and any other","page_number":103,"box":{"x":70,"y":551,"width":789,"height":11}},{"id":"41285c6c-515d-432f-b5e6-a09d88584964","block_type":"box","text":"borrowings in the aggregate, or (ii) treats all such transactions as Derivatives Transactions under Rule 18f-4. See “—","page_number":103,"box":{"x":69,"y":566,"width":836,"height":11}},{"id":"62a1daee-dc8e-4968-a0fb-74327fe73875","block_type":"box","text":"Derivatives — Regulation of Derivatives — Rule 18f-4 under the Investment Company Act” above. The SEC has also","page_number":103,"box":{"x":70,"y":581,"width":824,"height":12}},{"id":"62867a47-d493-4caf-8776-c1737e03da4a","block_type":"box","text":"finalized rules that will require cer tain transactions involving U.S. Treasuries, including reverse repurchase","page_number":103,"box":{"x":68,"y":596,"width":758,"height":12}},{"id":"37b67e3f-52be-48ca-acca-70015db6d7ff","block_type":"box","text":"agreements, to be centrally cleared. Compliance with these rules is expected to be required by the middle of 2027.","page_number":103,"box":{"x":69,"y":612,"width":822,"height":11}},{"id":"8c658b9b-d4aa-41f3-8ace-ee6f9fb63c22","block_type":"box","text":"Although the impact of these rules on the Funds is difficult to predict, they may reduce the availability or increase the","page_number":103,"box":{"x":68,"y":627,"width":838,"height":11}},{"id":"de9d60c2-51f8-486f-ade6-4f0883c05b1a","block_type":"box","text":"costs of such transactions and may adversely affect a Fund’s per formance.","page_number":103,"box":{"x":69,"y":642,"width":538,"height":11}},{"id":"d21c020c-d5e3-4995-9c81-cb0448f54c3c","block_type":"box","text":"Additionally, regulations adopted by global prudential regulators require cer tain bank-regulated counterpar ties","page_number":103,"box":{"x":101,"y":665,"width":780,"height":11}},{"id":"d5d79476-706a-4983-80e9-774624e17c70","block_type":"box","text":"and cer tain of their affiliates to include in cer tain financial contracts, including many reverse repurchase agreements,","page_number":103,"box":{"x":69,"y":680,"width":838,"height":11}},{"id":"1e52fb0e-b7bf-4063-8301-ce6817e576e6","block_type":"box","text":"terms that delay or restrict the rights of counterpar ties, such as a Fund, to terminate such agreements, take","page_number":103,"box":{"x":68,"y":695,"width":775,"height":11}},{"id":"3a350ee4-aad3-49d9-b702-6c464603e526","block_type":"box","text":"foreclosure action, exercise other default rights or restrict transfers of credit suppor t in the event that the","page_number":103,"box":{"x":68,"y":710,"width":754,"height":11}},{"id":"786a777e-99a6-4e88-9c71-bfde4bb076ca","block_type":"box","text":"counterpar ty and/or its affiliates are subject to cer tain types of resolution or insolvency proceedings. It is possible","page_number":103,"box":{"x":69,"y":725,"width":818,"height":11}},{"id":"9b990113-2852-4873-a7e1-03ed3b3a19f5","block_type":"box","text":"that these requirements, as well as potential additional government regulation and other developments in the","page_number":103,"box":{"x":68,"y":740,"width":783,"height":11}},{"id":"b053911d-001d-4803-9acf-eebbfb74d1c3","block_type":"box","text":"market, could adversely affect a Fund’s ability to terminate existing reverse repurchase agreements or to realize","page_number":103,"box":{"x":69,"y":755,"width":800,"height":11}},{"id":"358d2223-b9b1-465a-9002-81b60806f426","block_type":"box","text":"amounts to be received under such agreements.","page_number":103,"box":{"x":69,"y":771,"width":345,"height":11}},{"id":"a85220a1-edb7-4fd7-aa43-e7ade8921642","block_type":"box","text":"Rights Offerings and Warrants to Purchase.","page_number":103,"box":{"x":102,"y":793,"width":316,"height":11}},{"id":"03086bbc-f5bb-435f-8e14-c1eb2841737c","block_type":"box","text":"Cer tain Funds may par ticipate in rights offerings and may purchase","page_number":103,"box":{"x":424,"y":793,"width":481,"height":11}},{"id":"12497af8-747d-47e6-b8db-6b74630917d2","block_type":"box","text":"warrants, which are privileges issued by corporations enabling the owners to subscribe to and purchase a specified","page_number":103,"box":{"x":68,"y":808,"width":822,"height":11}},{"id":"372dd9cc-79b7-4b93-bf62-02ac294a4f6b","block_type":"box","text":"number of shares of the corporation at a specified price during a specified period of time. Subscription rights","page_number":103,"box":{"x":69,"y":823,"width":776,"height":12}},{"id":"2d24e2d4-20e3-4873-945b-cccefbe2eb09","block_type":"box","text":"normally have a shor t life span to expiration. The purchase of rights or warrants involves the risk that a Fund could","page_number":103,"box":{"x":69,"y":838,"width":817,"height":12}},{"id":"83173c80-a709-4b35-9c7d-68d11dcb916f","block_type":"box","text":"lose the purchase value of a right or warrant if the right to subscribe to additional shares is not exercised prior to the","page_number":103,"box":{"x":70,"y":853,"width":833,"height":12}},{"id":"3154fcec-78ff-48e8-8d90-9fb396c5f186","block_type":"box","text":"rights’ and warrants’ expiration. Also, the purchase of rights and/or warrants involves the risk that the effective price","page_number":103,"box":{"x":69,"y":869,"width":835,"height":11}},{"id":"558bde08-cd82-403a-a9bc-99b4f8c7d963","block_type":"box","text":"paid for the right and/or warrant added to the subscription price of the related security may exceed the value of the","page_number":103,"box":{"x":70,"y":884,"width":821,"height":11}},{"id":"1f9f8853-3c41-4263-9ccb-b6f40d0693be","block_type":"box","text":"subscribed security’s market price such as when there is no movement in the level of the underlying security. Buying","page_number":103,"box":{"x":69,"y":899,"width":830,"height":11}},{"id":"ca5060c8-a936-48f7-b4e0-025ff41ff7c8","block_type":"box","text":"II-72","page_number":103,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"191d6c4a-7713-4771-8ca0-1f67f7b61f0f","block_type":"box","text":"NM1026U-5982568-103/232","page_number":103,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"454354e0-14a5-46e3-a2ad-1e7b7aab7169","block_type":"box","text":"a warrant does not make the Fund a shareholder of the underlying stock. The warrant holder has no voting or","page_number":104,"box":{"x":69,"y":45,"width":777,"height":11}},{"id":"9664d4bd-5d11-468a-b541-62dcc1b7bd2d","block_type":"box","text":"dividend rights with respect to the underlying stock. A warrant does not carry any right to assets of the issuer, and for","page_number":104,"box":{"x":69,"y":60,"width":839,"height":11}},{"id":"6436560b-b99c-4db7-b300-f8298a4fd476","block_type":"box","text":"this reason investments in warrants may be more speculative than other equity-based investments.","page_number":104,"box":{"x":68,"y":75,"width":708,"height":11}},{"id":"568997e2-4944-48a2-b375-23b0e1201353","block_type":"box","text":"Rule 144A Securities.","page_number":104,"box":{"x":102,"y":98,"width":159,"height":9}},{"id":"5344e5bc-4c21-4d43-9213-93af1a4407bd","block_type":"box","text":"A Fund may purchase securities that can be offered and sold only to “qualified","page_number":104,"box":{"x":266,"y":98,"width":560,"height":11}},{"id":"550c666c-ebfb-4d2f-a5dd-b06b82898a09","block_type":"box","text":"institutional buyers” pursuant to Rule 144A under the Securities Act. See “Restricted Securities” above.","page_number":104,"box":{"x":70,"y":113,"width":741,"height":11}},{"id":"81a299dc-12ec-4eb6-9ed6-26f3dcc82e3f","block_type":"box","text":"Securities Lending.","page_number":104,"box":{"x":101,"y":135,"width":139,"height":11}},{"id":"c924f0ed-6525-4a75-92f2-7e313220ca5a","block_type":"box","text":"Each Fund may lend por tfolio securities to cer tain borrowers that BlackRock determines to","page_number":104,"box":{"x":247,"y":135,"width":645,"height":11}},{"id":"080b924d-883b-49f7-8549-e0c31abb7470","block_type":"box","text":"be creditwor thy, including borrowers affiliated with BlackRock. The borrowers provide collateral that is maintained in","page_number":104,"box":{"x":69,"y":150,"width":825,"height":12}},{"id":"ff0e5961-3865-44cc-a9a3-886af9949ec3","block_type":"box","text":"an amount at least equal to the current market value of the securities loaned. No securities loan shall be made on","page_number":104,"box":{"x":69,"y":166,"width":817,"height":11}},{"id":"cae81e0c-6216-4d06-a20f-07c7911f34e3","block_type":"box","text":"behalf of a Fund if, as a result, the aggregate value of all securities loans of the par ticular Fund exceeds one-third of","page_number":104,"box":{"x":69,"y":181,"width":831,"height":11}},{"id":"e55457f2-e2ae-4f95-81d0-f7febcc4d6fd","block_type":"box","text":"the value of such Fund’s total assets (including the value of the collateral received). A Fund may terminate a loan at","page_number":104,"box":{"x":68,"y":196,"width":827,"height":11}},{"id":"c363fd53-01b3-4501-9901-3d827f9d7b51","block_type":"box","text":"any time and obtain the return of the securities loaned. Each Fund receives, by way of substitute payment, the value","page_number":104,"box":{"x":69,"y":211,"width":829,"height":11}},{"id":"cf18ee7e-0262-49e5-996e-68f51a38fcd5","block_type":"box","text":"of any interest or cash or non-cash distributions paid on the loaned securities that it would have otherwise received if","page_number":104,"box":{"x":69,"y":226,"width":838,"height":11}},{"id":"d5c1a745-4fcd-4246-b8fc-78e5fd483aa7","block_type":"box","text":"the securities were not on loan.","page_number":104,"box":{"x":68,"y":241,"width":225,"height":9}},{"id":"25443751-a672-4fa7-805d-ab5db52be3e3","block_type":"box","text":"With respect to loans that are collateralized by cash, the borrower may be entitled to receive a fee based on the","page_number":104,"box":{"x":101,"y":264,"width":799,"height":11}},{"id":"17ea7872-ab6a-4805-aa3c-5cb17efde9da","block_type":"box","text":"amount of cash collateral. The Funds are compensated by any positive difference between the amount earned on the","page_number":104,"box":{"x":69,"y":279,"width":835,"height":11}},{"id":"ddaf28aa-544f-4aec-95d2-16f5e1d99c56","block_type":"box","text":"reinvestment of cash collateral and the fee paid to the borrower. In the case of collateral other than cash, a Fund is","page_number":104,"box":{"x":69,"y":294,"width":824,"height":11}},{"id":"e97183af-3afa-48bd-a7bf-1964ecd5922e","block_type":"box","text":"compensated by a fee paid by the borrower equal to a percentage of the market value of the loaned securities. Any","page_number":104,"box":{"x":69,"y":309,"width":821,"height":11}},{"id":"f2f6e134-bc70-40f5-960d-2b2562301ce8","block_type":"box","text":"cash collateral received by the Fund for such loans, and uninvested cash, may be reinvested in cer tain shor t-term","page_number":104,"box":{"x":69,"y":324,"width":810,"height":11}},{"id":"acd5dcba-84a7-4963-911d-72cb83498b34","block_type":"box","text":"instruments either directly on behalf of the Fund or through one or more joint accounts or money market funds,","page_number":104,"box":{"x":70,"y":339,"width":789,"height":12}},{"id":"d292be3e-0b68-427e-80ca-02d272767667","block_type":"box","text":"including those affiliated with BlackRock; such investments are subject to investment risk.","page_number":104,"box":{"x":70,"y":355,"width":643,"height":11}},{"id":"be7c8827-0f66-41e7-b187-f302f61c6cbd","block_type":"box","text":"Securities lending involves exposure to cer tain risks, including operational risk (","page_number":104,"box":{"x":102,"y":377,"width":568,"height":12}},{"id":"0a40f02e-fffa-4f7c-9e43-53798791d983","block_type":"box","text":"i.e.","page_number":104,"box":{"x":672,"y":377,"width":20,"height":9}},{"id":"1ee12201-68fe-4b05-bd1c-e7d381e0d185","block_type":"box","text":", the risk of losses resulting","page_number":104,"box":{"x":695,"y":377,"width":198,"height":12}},{"id":"0127c605-1e73-4ec6-9f15-93d8f25826f3","block_type":"box","text":"from problems in the settlement and accounting process), “gap” risk (","page_number":104,"box":{"x":68,"y":392,"width":501,"height":12}},{"id":"7c5130c7-f0bf-425f-b523-394b866cc153","block_type":"box","text":"i.e.","page_number":104,"box":{"x":571,"y":393,"width":20,"height":8}},{"id":"827213c7-704f-4888-839e-d5ef499ab51e","block_type":"box","text":", the risk of a mismatch between the return","page_number":104,"box":{"x":594,"y":392,"width":307,"height":11}},{"id":"ff741d44-6cb4-45d6-be69-6ad70aed4db2","block_type":"box","text":"on cash collateral reinvestments and the fees each Fund has agreed to pay a borrower), foreign exchange risk (","page_number":104,"box":{"x":69,"y":407,"width":794,"height":12}},{"id":"a8f7cd5e-bd63-4044-a6bf-a096ca69c49c","block_type":"box","text":"i.e.","page_number":104,"box":{"x":865,"y":408,"width":20,"height":8}},{"id":"ea5b4972-5db4-406e-84e4-fdfba3bc726e","block_type":"box","text":",","page_number":104,"box":{"x":888,"y":415,"width":2,"height":3}},{"id":"c16d08c6-e0d6-4a7e-9ea4-061662d7e54b","block_type":"box","text":"the risk of a shor tfall at default when a cash collateral investment is denominated in a currency other than the","page_number":104,"box":{"x":68,"y":423,"width":788,"height":11}},{"id":"3ca0a94d-5f8c-446d-a58a-5d0340fa6c0d","block_type":"box","text":"currency of the assets being loaned due to movements in foreign exchange rates), and credit, legal, counterpar ty and","page_number":104,"box":{"x":69,"y":438,"width":837,"height":11}},{"id":"09a4f0b4-c534-4102-bca4-c39863dc6c40","block_type":"box","text":"market risks (including the risk that market events, including but not limited to corporate actions, could lead a Fund","page_number":104,"box":{"x":69,"y":453,"width":822,"height":11}},{"id":"fd3cf197-cdc6-4f8d-ac6b-6cd48589070c","block_type":"box","text":"to lend securities that are trading at a premium due to increased demand, or to recall loaned securities or to lend","page_number":104,"box":{"x":68,"y":468,"width":811,"height":11}},{"id":"3f076f49-cc5a-4013-ab09-143ea0fd7c76","block_type":"box","text":"less or not at all, which could lead to reduced securities lending revenue). If a Fund were to lend out securities that","page_number":104,"box":{"x":70,"y":483,"width":820,"height":11}},{"id":"c79e8841-fd4c-43ec-ac0f-5b68dfa2e37b","block_type":"box","text":"are subject to a corporate action and commit to the borrower a par ticular election as determined by the Fund’s","page_number":104,"box":{"x":69,"y":498,"width":790,"height":11}},{"id":"d789e3cf-8007-46ad-9245-285c49ab90bd","block_type":"box","text":"investment adviser, the benefit the Fund would receive in respect of committing to such election may or may not be","page_number":104,"box":{"x":70,"y":513,"width":820,"height":12}},{"id":"3c3f7305-f3be-4522-933b-33a1907234f2","block_type":"box","text":"less than the benefit the Fund would have received from making a different election in such corporate action. If a","page_number":104,"box":{"x":70,"y":528,"width":805,"height":12}},{"id":"47024874-337b-4513-94c2-29d3f84ee55e","block_type":"box","text":"securities lending counterpar ty were to default, a Fund would be subject to the risk of a possible delay in receiving","page_number":104,"box":{"x":69,"y":543,"width":816,"height":12}},{"id":"255bd0c8-f7d3-49e2-a445-7ee3bce3e046","block_type":"box","text":"collateral or in recovering the loaned securities, or to a possible loss of rights in the collateral. In the event a","page_number":104,"box":{"x":69,"y":559,"width":775,"height":11}},{"id":"744b8e07-22a2-4a14-bbed-2a00dbfdc1ff","block_type":"box","text":"borrower does not return a Fund’s securities as agreed, the Fund’s ability to par ticipate in a corporate action event","page_number":104,"box":{"x":69,"y":574,"width":821,"height":11}},{"id":"b96c9b43-fad2-4f5e-bfca-8d0699f6a903","block_type":"box","text":"may be impacted, or the Fund may experience losses if the proceeds received from liquidating the collateral do not at","page_number":104,"box":{"x":69,"y":589,"width":838,"height":11}},{"id":"140d1470-ec2e-4861-a8f2-322913ca985b","block_type":"box","text":"least equal the value of the loaned security at the time the collateral is liquidated, plus the transaction costs incurred","page_number":104,"box":{"x":70,"y":604,"width":837,"height":11}},{"id":"b84b79fa-53e3-4b99-9588-4d8345a99842","block_type":"box","text":"in purchasing replacement securities. This latter event could trigger adverse tax consequences for a Fund. A Fund","page_number":104,"box":{"x":70,"y":619,"width":808,"height":11}},{"id":"fa809e70-2417-4170-ad27-2c2f023e4384","block_type":"box","text":"could lose money if its shor t-term investment of the collateral declines in value over the period of the loan. Substitute","page_number":104,"box":{"x":69,"y":634,"width":839,"height":11}},{"id":"3dac3f8e-0043-4a48-9180-2216511cb016","block_type":"box","text":"payments received by a Fund representing dividends paid on securities loaned out by the Fund will not be considered","page_number":104,"box":{"x":70,"y":650,"width":832,"height":11}},{"id":"c296ec6a-cb01-4e38-bf8f-ca866a9babf5","block_type":"box","text":"qualified dividend income, and distributions by the Fund of such substitute payments will not constitute qualified","page_number":104,"box":{"x":69,"y":664,"width":801,"height":12}},{"id":"58da6388-3fba-4735-8d91-45ad3842a14a","block_type":"box","text":"dividend income. Additionally, substitute payments received by a Fund representing qualified REIT dividends paid on","page_number":104,"box":{"x":69,"y":680,"width":823,"height":11}},{"id":"d218301c-9ead-4e80-82dc-e64539afa36f","block_type":"box","text":"REIT securities loaned out by the Fund will not be considered qualified REIT dividends, and distributions by the Fund","page_number":104,"box":{"x":70,"y":695,"width":823,"height":11}},{"id":"f9f4e53f-520f-4f51-bdbf-4c12803bb601","block_type":"box","text":"of such substitute payments will not be eligible for a 20% deduction currently available for ordinary REIT dividends","page_number":104,"box":{"x":69,"y":710,"width":812,"height":11}},{"id":"6bd2890e-8091-4fba-b57a-6b89a544d1a3","block_type":"box","text":"paid to non-corporate shareholders provided cer tain other requirements are satisfied. The securities lending agent","page_number":104,"box":{"x":70,"y":725,"width":814,"height":11}},{"id":"99e782f1-1845-4024-aec5-315f580f8c35","block_type":"box","text":"will take into account the tax effects on shareholders caused by these differences in connection with a Fund’s","page_number":104,"box":{"x":68,"y":740,"width":787,"height":11}},{"id":"62abb559-91c6-4be6-94c3-045030de6df9","block_type":"box","text":"securities lending program. Substitute payments received on tax-exempt securities loaned out will not be tax-exempt","page_number":104,"box":{"x":69,"y":755,"width":828,"height":11}},{"id":"715b3479-c8f9-476a-8d74-871423e6d48f","block_type":"box","text":"income. There could also be changes in the status of issuers under applicable laws and regulations, including tax","page_number":104,"box":{"x":70,"y":770,"width":809,"height":12}},{"id":"da2f71e5-cd9a-4070-b54d-fa66174cf0db","block_type":"box","text":"regulations, that may impact the regulatory or tax treatment of loaned securities and could, for example, result in a","page_number":104,"box":{"x":69,"y":785,"width":821,"height":12}},{"id":"38ccb788-921e-4784-951d-e35a382088fb","block_type":"box","text":"delay in the payment of dividend equivalent payments owed to a Fund (as permitted by applicable law).","page_number":104,"box":{"x":69,"y":801,"width":731,"height":11}},{"id":"92400365-1897-4ff3-a3bf-0d50745bcef2","block_type":"box","text":"Regulations adopted by global prudential regulators require cer tain bank-regulated counterpar ties and cer tain of","page_number":104,"box":{"x":102,"y":823,"width":800,"height":12}},{"id":"ed3bc124-d098-4bcf-abad-ff786cd597f4","block_type":"box","text":"their affiliates to include in cer tain financial contracts, including many securities lending agreements, terms that","page_number":104,"box":{"x":68,"y":838,"width":802,"height":12}},{"id":"60c65d18-f5b3-4f83-be94-e33413718405","block_type":"box","text":"delay or restrict the rights of counterpar ties, such as the Fund, to terminate such agreements, foreclose upon","page_number":104,"box":{"x":69,"y":853,"width":783,"height":12}},{"id":"2afaf234-725c-458a-959c-60b3e6f3bc7b","block_type":"box","text":"collateral, exercise other default rights or restrict transfers of credit suppor t in the event that the counterpar ty and/or","page_number":104,"box":{"x":69,"y":869,"width":839,"height":11}},{"id":"d2d08425-efd4-41ce-afd2-3f9d8b1951b5","block_type":"box","text":"its affiliates are subject to cer tain types of resolution or insolvency proceedings. It is possible that these","page_number":104,"box":{"x":70,"y":884,"width":747,"height":11}},{"id":"86216bf2-a719-4d5a-946b-20d673f69a15","block_type":"box","text":"requirements, as well as potential additional government regulation and other developments in the market, could","page_number":104,"box":{"x":69,"y":899,"width":806,"height":11}},{"id":"e3b981ac-d1d1-4ef6-835f-029ea68b4c57","block_type":"box","text":"II-73","page_number":104,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"97fdc99e-48ea-4db7-b660-bc8b3acff392","block_type":"box","text":"NM1026U-5982568-104/232","page_number":104,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"9d9e2d2e-3d90-4f27-9b4d-46548b9b98e4","block_type":"box","text":"adversely affect the Fund’s ability to terminate existing securities lending agreements or to realize amounts to be","page_number":105,"box":{"x":69,"y":45,"width":808,"height":11}},{"id":"bbda332c-f78f-4fce-b692-90150b8f8e94","block_type":"box","text":"received under such agreements. Prudential regulation may also favor lenders that can provide additional protections,","page_number":105,"box":{"x":69,"y":60,"width":839,"height":11}},{"id":"732aac4f-0c35-4c33-b7f4-2895c0fe368f","block_type":"box","text":"such as liens that are exercisable in connection with a lender default, to borrowers. Cer tain Funds expect to provide","page_number":105,"box":{"x":69,"y":75,"width":827,"height":11}},{"id":"261dc685-0696-4dbd-a0c3-2060933fbc57","block_type":"box","text":"additional protections to borrowers, where permitted pursuant to a Fund’s investment policies and if BlackRock","page_number":105,"box":{"x":69,"y":90,"width":794,"height":11}},{"id":"65c1e93e-b861-4ae6-b66c-c25709dea364","block_type":"box","text":"believes doing so is in the best interest of the Fund.","page_number":105,"box":{"x":69,"y":105,"width":371,"height":11}},{"id":"56646c08-d33a-49a3-9447-98ad53f0aa9b","block_type":"box","text":"The SEC has adopted a rule that will require repor ting and public disclosure of securities loan transaction","page_number":105,"box":{"x":101,"y":128,"width":753,"height":11}},{"id":"cb3b979e-3354-4be7-88e8-78d4d8002651","block_type":"box","text":"information (not including par ty names); this may include, but is not limited to, information about securities loans","page_number":105,"box":{"x":70,"y":143,"width":808,"height":11}},{"id":"1679164f-6cdb-4784-8bde-efb492f5fc4c","block_type":"box","text":"entered into in connection with shor t sales. Compliance with this rule is expected to be required in late 2028,","page_number":105,"box":{"x":69,"y":158,"width":784,"height":11}},{"id":"0a9ac089-823f-402f-a1e2-9dc02d40147e","block_type":"box","text":"although in response to the outcome of a legal challenge against the rule, the SEC may amend the rule and/or delay","page_number":105,"box":{"x":69,"y":173,"width":833,"height":11}},{"id":"b60ec2e7-5ceb-409f-8fb4-c8281016181f","block_type":"box","text":"the current expected compliance date.","page_number":105,"box":{"x":68,"y":188,"width":273,"height":11}},{"id":"1d5c9e35-a0a6-457f-8222-7242c266997c","block_type":"box","text":"Short Sales.","page_number":105,"box":{"x":101,"y":211,"width":89,"height":9}},{"id":"1ab3d71f-72f6-4823-8bf3-92aa89192099","block_type":"box","text":"Cer tain Funds may make shor t sales of securities, either as a hedge against potential declines in","page_number":105,"box":{"x":196,"y":211,"width":696,"height":11}},{"id":"88bcf405-db40-4e7f-96ce-9d8907a09931","block_type":"box","text":"value of a por tfolio security or to realize appreciation when a security that the Fund does not own declines in value.","page_number":105,"box":{"x":68,"y":226,"width":821,"height":11}},{"id":"db585d5f-8b67-4cb6-9b6c-0a28d6928385","block_type":"box","text":"Cer tain Funds have a fundamental investment restriction prohibiting shor t sales of securities unless they are","page_number":105,"box":{"x":69,"y":241,"width":778,"height":11}},{"id":"e43b95d6-fa80-4e30-a07b-9dc915280901","block_type":"box","text":"“against-the-box.” In a shor t sale “against-the-box,” at the time of the sale, the Fund owns or has the immediate and","page_number":105,"box":{"x":70,"y":256,"width":831,"height":12}},{"id":"83747aa5-d378-4d5d-aee9-b16254a73c41","block_type":"box","text":"unconditional right to acquire the identical security at no additional cost. When a Fund makes a shor t sale, it borrows","page_number":105,"box":{"x":69,"y":272,"width":837,"height":11}},{"id":"17ddff05-7435-4472-a437-254dc3db48ed","block_type":"box","text":"the security sold shor t and delivers it to the broker-dealer through which it made the shor t sale. A Fund may have to","page_number":105,"box":{"x":68,"y":287,"width":828,"height":11}},{"id":"18597380-dbed-48e0-b28a-669869f242ce","block_type":"box","text":"pay a fee to borrow par ticular securities and is often obligated to turn over any payments received on such borrowed","page_number":105,"box":{"x":70,"y":302,"width":829,"height":11}},{"id":"84e165d5-fc99-44d0-ac90-b7ba659f552e","block_type":"box","text":"securities to the lender of the securities.","page_number":105,"box":{"x":69,"y":317,"width":289,"height":9}},{"id":"4c968702-105c-4cfc-9340-54dfee0a906d","block_type":"box","text":"A Fund secures its obligation to replace the borrowed security by depositing collateral with the broker-dealer,","page_number":105,"box":{"x":101,"y":340,"width":772,"height":11}},{"id":"cf667564-da36-4504-b09f-a041041b94b3","block_type":"box","text":"usually in cash, U.S. Government Securities or other liquid securities similar to those borrowed. With respect to","page_number":105,"box":{"x":69,"y":355,"width":795,"height":11}},{"id":"a2cbcba0-812a-4a8d-bece-ed7eb39af5d5","block_type":"box","text":"uncovered shor t positions, a Fund is required to deposit similar collateral with its custodian, if necessary, to the","page_number":105,"box":{"x":69,"y":370,"width":801,"height":11}},{"id":"5cde619b-b303-42dc-81fd-780d8affc5ad","block_type":"box","text":"extent that the value of both collateral deposits in the aggregate is at all times equal to at least 100% of the current","page_number":105,"box":{"x":69,"y":385,"width":830,"height":11}},{"id":"e91925dc-7290-4ab1-9570-ebd3289ecb5d","block_type":"box","text":"market value of the security sold shor t. Depending on arrangements made with the broker-dealer from which the Fund","page_number":105,"box":{"x":69,"y":400,"width":839,"height":11}},{"id":"01aa7a93-2a02-4bf2-9f30-b18522dfafd6","block_type":"box","text":"borrowed the security, regarding payment received by the Fund on such security, a Fund may not receive any","page_number":105,"box":{"x":69,"y":415,"width":770,"height":11}},{"id":"ba319d08-9b76-4398-80e2-594d7c36a5c5","block_type":"box","text":"payments (including interest) on its collateral deposited with such broker-dealer.","page_number":105,"box":{"x":70,"y":430,"width":568,"height":11}},{"id":"44c2c7b3-5e5b-4e6b-ae4c-11987152abc3","block_type":"box","text":"Because making shor t sales in securities that it does not own exposes a Fund to the risks associated with those","page_number":105,"box":{"x":102,"y":453,"width":806,"height":11}},{"id":"18b6376b-e229-421f-b743-01396bc14b24","block_type":"box","text":"securities, such shor t sales involve speculative exposure risk. A Fund will incur a loss as a result of a shor t sale if","page_number":105,"box":{"x":69,"y":468,"width":817,"height":11}},{"id":"cfe77014-27d9-45bd-bacc-22535a41f378","block_type":"box","text":"the price of the security increases between the date of the shor t sale and the date on which the Fund replaces the","page_number":105,"box":{"x":68,"y":483,"width":819,"height":11}},{"id":"4faf0897-10ba-4cd1-860b-ab80d46a189c","block_type":"box","text":"borrowed security. As a result, if a Fund makes shor t sales in securities that increase in value, it will likely","page_number":105,"box":{"x":69,"y":498,"width":758,"height":11}},{"id":"4ca3e995-61bb-4d01-9775-58bc884e2fd7","block_type":"box","text":"underper form similar mutual funds that do not make shor t sales in securities. A Fund will realize a gain on a shor t","page_number":105,"box":{"x":69,"y":513,"width":817,"height":12}},{"id":"2e76720f-f252-4476-bfa5-382d74dde704","block_type":"box","text":"sale if the security declines in price between those dates. There can be no assurance that a Fund will be able to","page_number":105,"box":{"x":69,"y":528,"width":800,"height":12}},{"id":"bc0fc0d0-76b3-492c-8413-8bae109fd600","block_type":"box","text":"close out a shor t sale position at any par ticular time or at an acceptable price. Although a Fund’s gain is limited to","page_number":105,"box":{"x":69,"y":544,"width":818,"height":11}},{"id":"b6a82937-9881-4dd7-b1cc-95210d2259d5","block_type":"box","text":"the price at which it sold the security shor t, its potential loss is limited only by the maximum attainable price of the","page_number":105,"box":{"x":68,"y":559,"width":821,"height":11}},{"id":"6ab9a10b-573b-48bb-8511-cd522e891710","block_type":"box","text":"security, less the price at which the security was sold and may, theoretically, be unlimited.","page_number":105,"box":{"x":69,"y":574,"width":640,"height":11}},{"id":"117ae2f1-92f8-4619-9d62-685bc7f5227d","block_type":"box","text":"A Fund may also make shor t sales “against the box” without being subject to such limitations.","page_number":105,"box":{"x":101,"y":597,"width":673,"height":11}},{"id":"bd8a030d-0345-44d7-bde3-9e949d947938","block_type":"box","text":"A Fund must comply with Rule 18f-4 under the Investment Company Act with respect to its shor t sale","page_number":105,"box":{"x":101,"y":619,"width":721,"height":11}},{"id":"58c30feb-fecb-4f57-ab3c-fdbf7b0299b5","block_type":"box","text":"borrowings, which are considered Derivatives Transactions under the Rule. See “—Derivatives — Regulation of","page_number":105,"box":{"x":69,"y":634,"width":791,"height":12}},{"id":"1e9b158d-4277-44c0-8993-b1b70906d258","block_type":"box","text":"Derivatives — Rule 18f-4 under the Investment Company Act” above.","page_number":105,"box":{"x":70,"y":649,"width":489,"height":12}},{"id":"44c99a49-f5b0-4cc3-a90f-b1df91f6cccd","block_type":"box","text":"Shor t sales are also subject to cer tain SEC regulations and cer tain European Union and United Kingdom","page_number":105,"box":{"x":102,"y":672,"width":745,"height":11}},{"id":"e54ab820-c23d-42bb-9378-8d8f8dc9b6da","block_type":"box","text":"regulations (under which there are restrictions on net shor t sales in cer tain securities). If the SEC or regulatory","page_number":105,"box":{"x":69,"y":687,"width":793,"height":11}},{"id":"455b1525-b00c-46ec-8e8a-3b0114d9c751","block_type":"box","text":"authorities in other jurisdictions were to adopt additional restrictions regarding shor t sales, they could restrict a","page_number":105,"box":{"x":69,"y":703,"width":796,"height":11}},{"id":"fb0e6bd8-e2da-4242-8fc8-46effe21d0ef","block_type":"box","text":"Fund’s ability to engage in shor t sales in cer tain circumstances, and the Fund may be unable to execute its","page_number":105,"box":{"x":70,"y":718,"width":766,"height":11}},{"id":"c9593d3e-acc3-4f33-92c9-743850b8f76d","block_type":"box","text":"investment strategy as a result. In response to market events, the SEC and regulatory authorities in other","page_number":105,"box":{"x":70,"y":733,"width":754,"height":11}},{"id":"1b4824aa-77b5-407f-8362-2dae551940b1","block_type":"box","text":"jurisdictions may adopt (and in cer tain cases, have adopted) bans or other restrictions on shor t sales of cer tain","page_number":105,"box":{"x":67,"y":748,"width":800,"height":11}},{"id":"7b080354-f75d-4686-b4cf-adfe157c6e3a","block_type":"box","text":"securities or on derivatives and other hedging instruments used to achieve a similar economic effect. Such bans or","page_number":105,"box":{"x":69,"y":763,"width":823,"height":11}},{"id":"fae791af-b414-4e9a-ad21-1a235abf08a8","block_type":"box","text":"other restrictions may make it impossible for a Fund to execute cer tain investment strategies and may have a","page_number":105,"box":{"x":69,"y":778,"width":782,"height":11}},{"id":"6a1aa6e4-b566-4444-994a-71c35b75078e","block_type":"box","text":"material adverse effect on the Fund’s ability to generate returns.","page_number":105,"box":{"x":69,"y":793,"width":460,"height":11}},{"id":"62eb924a-33a6-4cbc-a0ac-123125bad7d6","block_type":"box","text":"Special Purpose Acquisition Companies.","page_number":105,"box":{"x":101,"y":816,"width":293,"height":11}},{"id":"d140c249-e533-4307-b291-c81f0715810d","block_type":"box","text":"A Fund may invest in stock, warrants, rights and other interests issued","page_number":105,"box":{"x":400,"y":816,"width":504,"height":11}},{"id":"55c09589-5028-4bb4-9811-5b1e9eca9835","block_type":"box","text":"by special purpose acquisition companies (“SPACs”) or similar special purpose entities that pool funds to seek","page_number":105,"box":{"x":69,"y":831,"width":791,"height":11}},{"id":"83e06f27-0021-409b-b0e5-300c7d8d7999","block_type":"box","text":"potential acquisition oppor tunities, including the “founder’s” shares and warrants described below. A SPAC is a","page_number":105,"box":{"x":70,"y":846,"width":793,"height":11}},{"id":"665c8226-d475-4b0f-8fe7-634e4df0e882","block_type":"box","text":"publicly traded company that raises investment capital via an IPO for the purpose of identifying and acquiring one or","page_number":105,"box":{"x":70,"y":861,"width":824,"height":11}},{"id":"5494ad7f-7a67-42a1-ba89-050070fa91a2","block_type":"box","text":"more operating businesses or assets. In connection with forming a SPAC, the SPAC’s sponsors acquire “founder’s”","page_number":105,"box":{"x":69,"y":876,"width":821,"height":11}},{"id":"bb5cc54f-dc80-4707-a3d0-1607ed4389e6","block_type":"box","text":"shares, generally for nominal consideration, and warrants that will result in the sponsors owning a specified","page_number":105,"box":{"x":69,"y":891,"width":768,"height":12}},{"id":"3f7f749f-66d6-4abb-b8c7-657fea817906","block_type":"box","text":"percentage (typically 20%) of the SPAC’s outstanding common stock upon completion of the IPO. At the time a SPAC","page_number":105,"box":{"x":70,"y":906,"width":826,"height":12}},{"id":"ee6b91ac-11bc-4c61-954f-3b6597623603","block_type":"box","text":"II-74","page_number":105,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"70649ccc-be91-4f8d-a1b8-68fd2e1a665f","block_type":"box","text":"NM1026U-5982568-105/232","page_number":105,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"a24d1a02-6051-4f15-9de5-589dcb98bda6","block_type":"box","text":"conducts an IPO, it has selected a management team but has not yet identified a specific acquisition oppor tunity.","page_number":106,"box":{"x":69,"y":45,"width":809,"height":11}},{"id":"f5ff22ad-00bc-437f-95b5-6ff9e6e4d4c4","block_type":"box","text":"Unless and until an acquisition is completed, a SPAC generally invests its assets in U.S. Government securities,","page_number":106,"box":{"x":70,"y":60,"width":797,"height":11}},{"id":"682e269a-7ead-4a34-bbff-0d10648fe776","block_type":"box","text":"money market securities and cash. If an acquisition that meets the requirements for the SPAC is not completed","page_number":106,"box":{"x":69,"y":75,"width":795,"height":11}},{"id":"a2e0ace1-ac64-453c-a548-942c4a348c37","block_type":"box","text":"within a pre-established period of time, the invested funds are returned to the SPAC’s public shareholders, the","page_number":106,"box":{"x":68,"y":90,"width":788,"height":11}},{"id":"21746713-1a04-4208-8c4c-89d3730a229e","block_type":"box","text":"warrants expire, and the “founder’s” shares and such warrants become wor thless. Because SPACs and similar","page_number":106,"box":{"x":68,"y":105,"width":794,"height":11}},{"id":"01a43110-f47c-48e9-a2d2-907eef6b1978","block_type":"box","text":"entities are in essence “blank check” companies without operating histories or ongoing business operations (other","page_number":106,"box":{"x":69,"y":120,"width":820,"height":12}},{"id":"6b68f4a4-78ab-4a99-89ee-52d86d352c24","block_type":"box","text":"than identifying and pursuing acquisitions), the potential for the long-term capital appreciation of their securities is","page_number":106,"box":{"x":68,"y":135,"width":815,"height":12}},{"id":"33b95429-3dfa-405d-ac9a-261e36b153ef","block_type":"box","text":"par ticularly dependent on the ability of the SPAC’s management to identify and complete a profitable acquisition.","page_number":106,"box":{"x":70,"y":150,"width":802,"height":12}},{"id":"712d6093-5040-4eeb-8668-ef0e43803fc1","block_type":"box","text":"There is no guarantee that the SPACs in which a Fund invests will complete an acquisition or that any acquisitions","page_number":106,"box":{"x":68,"y":166,"width":812,"height":11}},{"id":"c70c3035-120c-41d1-8b00-359987f647cb","block_type":"box","text":"completed by the SPACs in which the Fund invests will be profitable. Some SPACs may pursue acquisitions only within","page_number":106,"box":{"x":69,"y":181,"width":838,"height":11}},{"id":"0380a983-6891-49ce-ac37-5a1c68bac5f8","block_type":"box","text":"cer tain industries or regions, which may ultimately lead to an increase in the volatility of their prices following the","page_number":106,"box":{"x":69,"y":196,"width":806,"height":11}},{"id":"52e4e66a-6646-48fb-b18e-d7276fc7ff46","block_type":"box","text":"acquisition. In addition, some of these securities may be considered illiquid and/or subject to restrictions on resale.","page_number":106,"box":{"x":69,"y":211,"width":828,"height":11}},{"id":"3287648a-7770-4687-8911-c4fcd5ae90ee","block_type":"box","text":"Standby Commitment Agreements.","page_number":106,"box":{"x":101,"y":234,"width":255,"height":11}},{"id":"9f8b6f45-6838-4d06-b189-f5c11bc33503","block_type":"box","text":"Standby commitment agreements commit a Fund, for a stated period of","page_number":106,"box":{"x":362,"y":234,"width":511,"height":11}},{"id":"ea5da91e-ae78-4f3b-8b12-732cf321c788","block_type":"box","text":"time, to purchase a stated amount of securities that may be issued and sold to that Fund at the option of the issuer.","page_number":106,"box":{"x":68,"y":249,"width":834,"height":11}},{"id":"56ab9340-6794-4286-a723-29b79468d0c4","block_type":"box","text":"The price of the security is fixed at the time of the commitment. At the time of entering into the agreement, a Fund is","page_number":106,"box":{"x":68,"y":264,"width":834,"height":11}},{"id":"4f4dfe23-8f5b-4a95-b5a5-6157c256c3eb","block_type":"box","text":"paid a commitment fee, regardless of whether or not the security is ultimately issued. A Fund will enter into such","page_number":106,"box":{"x":70,"y":279,"width":802,"height":11}},{"id":"3b02cd02-b54a-4f34-9a05-ecf714cc1f41","block_type":"box","text":"agreements for the purpose of investing in the security underlying the commitment at a price that is considered","page_number":106,"box":{"x":69,"y":294,"width":793,"height":11}},{"id":"c4c28674-1305-4e1b-9fd3-64f3521e9a8c","block_type":"box","text":"advantageous to the Fund.","page_number":106,"box":{"x":69,"y":309,"width":188,"height":11}},{"id":"d778b089-2b0f-4028-9b73-5f6dc9534d75","block_type":"box","text":"There can be no assurance that the securities subject to a standby commitment will be issued, and the value of","page_number":106,"box":{"x":101,"y":332,"width":800,"height":11}},{"id":"b3f76723-69a3-4694-a959-e8222ec29984","block_type":"box","text":"the security, if issued, on the delivery date may be more or less than its purchase price. Since the issuance of the","page_number":106,"box":{"x":68,"y":347,"width":816,"height":11}},{"id":"e49cba68-0938-45c8-8cdf-f73307539126","block_type":"box","text":"security underlying the commitment is at the option of the issuer, the Fund may bear the risk of a decline in the value","page_number":106,"box":{"x":69,"y":362,"width":835,"height":11}},{"id":"67483d65-1d6b-4332-995f-b91af13afad0","block_type":"box","text":"of such security and may not benefit from an appreciation in the value of the security during the commitment period.","page_number":106,"box":{"x":69,"y":377,"width":828,"height":12}},{"id":"2e1365c5-eb5c-47e4-be7e-8e819495f020","block_type":"box","text":"The purchase of a security pursuant to a standby commitment agreement and the related commitment fee will","page_number":106,"box":{"x":101,"y":400,"width":785,"height":11}},{"id":"195aa1dd-a59d-4eb5-bb70-fbe46fb8391e","block_type":"box","text":"be recorded on the date on which the security can reasonably be expected to be issued, and the value of the security","page_number":106,"box":{"x":69,"y":415,"width":837,"height":11}},{"id":"9a2ac91f-fdd6-44f2-a286-7aea216172b7","block_type":"box","text":"thereafter will be reflected in the calculation of a Fund’s NAV. The cost basis of the security will be adjusted by the","page_number":106,"box":{"x":68,"y":430,"width":815,"height":11}},{"id":"a5b0b138-7096-4096-85ef-1c71f877ebc9","block_type":"box","text":"amount of the commitment fee. In the event the security is not issued, the commitment fee will be recorded as","page_number":106,"box":{"x":69,"y":445,"width":792,"height":11}},{"id":"29575292-22e1-4edb-a4e1-d1a02c70218c","block_type":"box","text":"income on the expiration date of the standby commitment.","page_number":106,"box":{"x":70,"y":460,"width":415,"height":12}},{"id":"9a4e9692-acda-461c-b827-f52db33827bd","block_type":"box","text":"Standby commitments will only be entered into with dealers, banks and broker-dealers which, in the Manager’s","page_number":106,"box":{"x":102,"y":483,"width":789,"height":11}},{"id":"ada64a9d-9ca5-43b5-8f82-94a2a68fa786","block_type":"box","text":"or sub-adviser’s opinion, present minimal credit risks. A Fund will acquire standby commitments solely to facilitate","page_number":106,"box":{"x":69,"y":498,"width":814,"height":11}},{"id":"56422d17-55de-4cf5-8a86-4f2ad769a842","block_type":"box","text":"por tfolio liquidity and not to exercise its rights thereunder for trading purposes. Standby commitments will be valued","page_number":106,"box":{"x":70,"y":513,"width":827,"height":12}},{"id":"b16c4654-a264-4e6a-94ba-eaca0bdaec5e","block_type":"box","text":"at zero in determining NAV. Accordingly, where a Fund pays directly or indirectly for a standby commitment, its cost","page_number":106,"box":{"x":69,"y":528,"width":815,"height":12}},{"id":"c747acba-388c-4215-aa2b-0209f3ad76e3","block_type":"box","text":"will be reflected as an unrealized loss for the period during which the commitment is held by such Fund and will be","page_number":106,"box":{"x":68,"y":543,"width":817,"height":12}},{"id":"590923bd-d9db-4947-802f-639e670e04cb","block_type":"box","text":"reflected as a realized gain or loss when the commitment is exercised or expires.","page_number":106,"box":{"x":69,"y":559,"width":578,"height":11}},{"id":"79cc764d-9dfd-45f0-8023-0168c963619f","block_type":"box","text":"Stripped Securities.","page_number":106,"box":{"x":101,"y":581,"width":143,"height":11}},{"id":"1d8e96c8-1968-4820-852b-7fea960c7bd6","block_type":"box","text":"Stripped securities are created when the issuer separates the interest and principal","page_number":106,"box":{"x":251,"y":581,"width":596,"height":11}},{"id":"1c48143f-1921-409c-879d-1de508c2066c","block_type":"box","text":"components of an instrument and sells them as separate securities. In general, one security is entitled to receive the","page_number":106,"box":{"x":69,"y":596,"width":839,"height":12}},{"id":"0ac47302-fa73-409b-a6d4-a12e94edbdd2","block_type":"box","text":"interest payments on the underlying assets (the interest only or “IO” security) and the other to receive the principal","page_number":106,"box":{"x":70,"y":612,"width":818,"height":11}},{"id":"ddbdb238-dd41-41cc-bd8f-6118f0858ea8","block_type":"box","text":"payments (the principal only or “PO” security). Some stripped securities may receive a combination of interest and","page_number":106,"box":{"x":70,"y":627,"width":813,"height":11}},{"id":"2f47343f-6cdf-40bb-990c-70b92a742bf5","block_type":"box","text":"principal payments. The yields to maturity on IOs and POs are sensitive to the expected or anticipated rate of","page_number":106,"box":{"x":70,"y":642,"width":777,"height":11}},{"id":"349b0cb2-5a55-468e-9db6-f55c5f41ed48","block_type":"box","text":"principal payments (including prepayments) on the related underlying assets, and principal payments may have a","page_number":106,"box":{"x":70,"y":657,"width":802,"height":11}},{"id":"3cdcff95-e066-4822-b23b-6719366dcfc4","block_type":"box","text":"material effect on yield to maturity. If the underlying assets experience greater than anticipated prepayments of","page_number":106,"box":{"x":69,"y":672,"width":794,"height":11}},{"id":"0e0c587f-92df-4b75-8941-2f1d10638963","block_type":"box","text":"principal, a Fund may not fully recoup its initial investment in IOs. Conversely, if the underlying assets experience less","page_number":106,"box":{"x":70,"y":687,"width":837,"height":11}},{"id":"709d86c1-79eb-464a-ba0f-f31bd77317d1","block_type":"box","text":"than anticipated prepayments of principal, the yield on POs could be adversely affected. Stripped securities may be","page_number":106,"box":{"x":68,"y":702,"width":823,"height":11}},{"id":"5ce25698-345c-443d-8a01-21e8ce1ce9b0","block_type":"box","text":"highly sensitive to changes in interest rates and rates of prepayment.","page_number":106,"box":{"x":69,"y":717,"width":494,"height":12}},{"id":"86b83ab5-24fe-43f1-9054-0c4fad4d6919","block_type":"box","text":"Structured Notes.","page_number":106,"box":{"x":101,"y":740,"width":130,"height":9}},{"id":"847b8109-ec18-41d4-bd96-68818d75f3a3","block_type":"box","text":"Structured notes and other related instruments purchased by a Fund are generally privately","page_number":106,"box":{"x":237,"y":740,"width":650,"height":11}},{"id":"bbf8835c-56cb-42f0-8236-9db442c189ff","block_type":"box","text":"negotiated debt obligations where the principal and/or interest is determined by reference to the per formance of a","page_number":106,"box":{"x":69,"y":755,"width":818,"height":11}},{"id":"950a09b8-4de9-4a3b-93f1-434b0385090f","block_type":"box","text":"specific asset, benchmark asset, market or interest rate (“reference measure”). Issuers of structured notes generally","page_number":106,"box":{"x":69,"y":770,"width":839,"height":12}},{"id":"3788cc85-898c-47f2-b6a6-ef7ef103ce00","block_type":"box","text":"include corporations and banks. The interest rate or the principal amount payable upon maturity or redemption may","page_number":106,"box":{"x":70,"y":786,"width":821,"height":11}},{"id":"7326b9dc-a33b-4676-afe1-e7ede3285ead","block_type":"box","text":"increase or decrease, depending upon changes in the value of the reference measure. The terms of a structured note","page_number":106,"box":{"x":70,"y":801,"width":839,"height":11}},{"id":"8b1a287d-74d6-4264-9067-9db2e4365ba3","block_type":"box","text":"may provide that, in cer tain circumstances, no principal is due at maturity and, therefore, may result in a loss of","page_number":106,"box":{"x":69,"y":816,"width":801,"height":11}},{"id":"0bb136e9-ddb1-48fa-acd3-dba463b58a84","block_type":"box","text":"invested capital by a Fund. The interest and/or principal payments that may be made on a structured product may","page_number":106,"box":{"x":70,"y":831,"width":813,"height":11}},{"id":"5ad093df-cf55-4939-aead-221a54351019","block_type":"box","text":"vary widely, depending on a variety of factors, including the volatility of the reference measure.","page_number":106,"box":{"x":68,"y":846,"width":673,"height":11}},{"id":"920bf774-26b5-4de3-905e-f4d67913e61e","block_type":"box","text":"Structured notes may be positively or negatively indexed, so the appreciation of the reference measure may","page_number":106,"box":{"x":102,"y":869,"width":768,"height":11}},{"id":"5a62b326-56be-4728-bf14-6c38bb9f163c","block_type":"box","text":"produce an increase or a decrease in the interest rate or the value of the principal at maturity. The rate of return on","page_number":106,"box":{"x":70,"y":884,"width":821,"height":11}},{"id":"f28baa01-6fe4-41df-a4cc-19e2e2bd9eff","block_type":"box","text":"II-75","page_number":106,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"3fc8f802-1fcc-4874-b6df-5ddc1a162732","block_type":"box","text":"NM1026U-5982568-106/232","page_number":106,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"2c1f1c98-9a85-475a-9202-de8e86a044a6","block_type":"box","text":"structured notes may be determined by applying a multiplier to the per formance or differential per formance of","page_number":107,"box":{"x":69,"y":45,"width":787,"height":11}},{"id":"2323cc26-9052-463b-ac9d-c0529fd6e9e2","block_type":"box","text":"reference measures. Application of a multiplier involves leverage that will serve to magnify the potential for gain and","page_number":107,"box":{"x":69,"y":60,"width":827,"height":11}},{"id":"6c328513-c806-4859-ab52-c45b59083481","block_type":"box","text":"the risk of loss.","page_number":107,"box":{"x":68,"y":75,"width":110,"height":9}},{"id":"ca01761c-5e39-4f4f-8c4e-1992b4443b35","block_type":"box","text":"The purchase of structured notes exposes a Fund to the credit risk of the issuer of the structured product.","page_number":107,"box":{"x":101,"y":98,"width":759,"height":11}},{"id":"61fd6be9-9315-407a-935d-047ac2cb2fa3","block_type":"box","text":"Structured notes may also be more volatile, less liquid, and more difficult to price accurately than less complex","page_number":107,"box":{"x":69,"y":113,"width":795,"height":11}},{"id":"0d41632f-5040-4ab5-b811-a1dda314e669","block_type":"box","text":"securities and instruments or more traditional debt securities. The secondary market for structured notes could be","page_number":107,"box":{"x":69,"y":128,"width":819,"height":11}},{"id":"193b9e0d-f99d-455b-b306-134e29034d53","block_type":"box","text":"illiquid making them difficult to sell when the Fund determines to sell them. The possible lack of a liquid secondary","page_number":107,"box":{"x":70,"y":143,"width":821,"height":11}},{"id":"3f967738-f436-4f20-ab99-051eed72b473","block_type":"box","text":"market for structured notes and the resulting inability of the Fund to sell a structured note could expose the Fund to","page_number":107,"box":{"x":69,"y":158,"width":827,"height":11}},{"id":"c3faa434-2a6d-4f94-a320-e737e5453c08","block_type":"box","text":"losses and could make structured notes more difficult for the Fund to value accurately.","page_number":107,"box":{"x":70,"y":173,"width":618,"height":11}},{"id":"11c7eeed-0c90-45ad-97b6-c8a5ee8fc121","block_type":"box","text":"Taxability Risk.","page_number":107,"box":{"x":103,"y":196,"width":109,"height":11}},{"id":"2851c689-b7b6-48e8-ad5c-37cc7beb1723","block_type":"box","text":"Cer tain of the Funds intend to minimize the payment of taxable income to shareholders by","page_number":107,"box":{"x":218,"y":196,"width":644,"height":11}},{"id":"e7f8859d-ef75-4f4b-9481-fae1454f4445","block_type":"box","text":"investing in tax-exempt or municipal securities in reliance at the time of purchase on an opinion of bond counsel to","page_number":107,"box":{"x":70,"y":211,"width":817,"height":11}},{"id":"55148cfa-8043-4620-93ae-d81478c5ee6a","block_type":"box","text":"the issuer and, in the case of derivative securities, sponsors’ counsel, that the interest paid on those securities will","page_number":107,"box":{"x":68,"y":226,"width":827,"height":11}},{"id":"9d9746d6-6e17-49d0-9ad3-7abe57367c90","block_type":"box","text":"be excludable from gross income for U.S. federal income tax purposes. Such securities, however, may be determined","page_number":107,"box":{"x":69,"y":241,"width":835,"height":11}},{"id":"773fc299-c7fd-45f8-a86e-5593cf68b64a","block_type":"box","text":"to pay, or have paid, taxable income subsequent to the Fund’s acquisition of the securities. In that event, the IRS","page_number":107,"box":{"x":68,"y":256,"width":809,"height":11}},{"id":"66464613-cc42-4480-b4be-c69bd5afc38f","block_type":"box","text":"may demand that the Fund pay U.S. federal income taxes on the affected interest income, and, if the Fund agrees to","page_number":107,"box":{"x":69,"y":271,"width":832,"height":12}},{"id":"9f0697eb-79ba-435f-a39e-92bd3035dbb4","block_type":"box","text":"do so, the Fund’s yield could be adversely affected. In addition, the treatment of dividends previously paid or to be","page_number":107,"box":{"x":69,"y":286,"width":816,"height":12}},{"id":"43ce3097-c66c-4aa5-a837-555c74125b4b","block_type":"box","text":"paid by the Fund as “exempt interest dividends” could be adversely affected, subjecting the Fund’s shareholders to","page_number":107,"box":{"x":70,"y":302,"width":822,"height":11}},{"id":"ac2b047e-6748-43a5-8f6f-95c7cf565933","block_type":"box","text":"increased U.S. federal income tax liabilities. If the interest paid on any tax-exempt or municipal security held by the","page_number":107,"box":{"x":70,"y":317,"width":818,"height":11}},{"id":"82cc46ca-d79e-4184-a989-a2d37c4b819d","block_type":"box","text":"Fund is subsequently determined to be taxable, the Fund will dispose of that security as soon as reasonably","page_number":107,"box":{"x":70,"y":332,"width":771,"height":11}},{"id":"63cbb2ac-ed37-4bf5-9d88-19d909a263b0","block_type":"box","text":"practicable. In addition, future laws, regulations, rulings or cour t decisions may cause interest on municipal","page_number":107,"box":{"x":70,"y":347,"width":765,"height":11}},{"id":"4efb8831-12f7-43e9-9ed4-13b33ac555a6","block_type":"box","text":"securities to be subject, directly or indirectly, to U.S. federal income taxation or interest on state municipal securities","page_number":107,"box":{"x":69,"y":362,"width":834,"height":11}},{"id":"63de14f0-1e7e-4263-aa49-e7b410e398f0","block_type":"box","text":"to be subject to state or local income taxation, or the value of state municipal securities to be subject to state or","page_number":107,"box":{"x":68,"y":377,"width":807,"height":11}},{"id":"63f4d6cb-4a89-43f0-9400-04881dc1b317","block_type":"box","text":"local intangible personal proper ty tax, or may otherwise prevent the Fund from realizing the full current benefit of the","page_number":107,"box":{"x":70,"y":392,"width":830,"height":12}},{"id":"c7549ba6-96a0-43ca-9367-8949e98024ec","block_type":"box","text":"tax-exempt status of such securities. Any such change could also affect the market price of such securities, and thus","page_number":107,"box":{"x":68,"y":407,"width":838,"height":12}},{"id":"d78372c9-fda9-4187-a732-9b0f0bd5cf3d","block_type":"box","text":"the value of an investment in the Fund.","page_number":107,"box":{"x":68,"y":423,"width":278,"height":9}},{"id":"ef05f9e1-5643-4709-973e-1d895ed1d129","block_type":"box","text":"Temporary Defensive Measures.","page_number":107,"box":{"x":103,"y":445,"width":230,"height":11}},{"id":"3c0e9cb8-1951-4248-8e5a-e4819a5ccc75","block_type":"box","text":"As a temporary defensive measure, including to respond to adverse market,","page_number":107,"box":{"x":339,"y":445,"width":542,"height":12}},{"id":"5bd75253-5e68-4c1b-af94-24ff4416c7a7","block_type":"box","text":"economic, political or other conditions, a Fund may depar t from its principal investment strategies and may invest","page_number":107,"box":{"x":69,"y":460,"width":811,"height":12}},{"id":"8752f63d-c261-4371-b0cb-e7f7710dffce","block_type":"box","text":"without limitation in cash, high quality money market instruments, or other shor t term investments. Cer tain Funds","page_number":107,"box":{"x":68,"y":476,"width":813,"height":11}},{"id":"e59e6816-46fc-48c5-ad2c-f16bec250783","block_type":"box","text":"may also invest in cash and other such instruments pending investment or to meet anticipated redemption requests.","page_number":107,"box":{"x":69,"y":491,"width":833,"height":11}},{"id":"e9443cd9-49a0-486d-a080-0ed0b26bd300","block_type":"box","text":"High quality money market instruments include U.S. Government obligations, U.S. Government agency obligations,","page_number":107,"box":{"x":70,"y":506,"width":813,"height":11}},{"id":"f4457aee-19e6-43e1-9fd1-b6d6bcff0599","block_type":"box","text":"dollar denominated obligations of foreign issuers, bank obligations, including U.S. subsidiaries and branches of","page_number":107,"box":{"x":69,"y":521,"width":795,"height":11}},{"id":"273251d8-708e-48be-a36e-3d5e0ebdfda4","block_type":"box","text":"foreign banks, corporate obligations, commercial paper, repurchase agreements and obligations of supranational","page_number":107,"box":{"x":68,"y":536,"width":806,"height":11}},{"id":"56ab5b53-4019-4236-907a-9898a8f26d75","block_type":"box","text":"organizations. Generally, such obligations will mature within one year from the date of settlement but may mature","page_number":107,"box":{"x":69,"y":551,"width":808,"height":11}},{"id":"7fe3e8aa-af9a-406d-b672-6e124f935afb","block_type":"box","text":"within two years from the date of settlement. Temporary defensive measures may affect a Fund’s ability to achieve","page_number":107,"box":{"x":68,"y":566,"width":820,"height":11}},{"id":"597e8132-ac19-4d9a-be40-5b06bb8604f0","block_type":"box","text":"its investment objective.","page_number":107,"box":{"x":70,"y":582,"width":171,"height":10}},{"id":"b6f68203-c267-4dfb-8391-048f2e2175ca","block_type":"box","text":"U.S. Government Obligations.","page_number":107,"box":{"x":102,"y":604,"width":213,"height":11}},{"id":"4363f59d-092d-4f84-867c-d6659327a1bb","block_type":"box","text":"A Fund may purchase obligations issued or guaranteed by the U.S. Government","page_number":107,"box":{"x":321,"y":604,"width":566,"height":11}},{"id":"087bf29e-d596-4eda-8cf1-eb7ae5680e13","block_type":"box","text":"and U.S. Government agencies and instrumentalities. Obligations of cer tain agencies and instrumentalities of the","page_number":107,"box":{"x":69,"y":619,"width":810,"height":11}},{"id":"f3db64e7-7f89-4026-b788-4c95d413b6b5","block_type":"box","text":"U.S. Government are suppor ted by the full faith and credit of the U.S. Treasury. Others are suppor ted by the right of","page_number":107,"box":{"x":70,"y":634,"width":826,"height":12}},{"id":"f0483a20-a695-4bdb-a7cb-18247b3b27c6","block_type":"box","text":"the issuer to borrow from the U.S. Treasury; and still others are suppor ted only by the credit of the agency or","page_number":107,"box":{"x":68,"y":649,"width":779,"height":12}},{"id":"95f9c785-8890-4020-aa08-a0ce03d8e260","block_type":"box","text":"instrumentality issuing the obligation. No assurance can be given that the U.S. Government will provide financial","page_number":107,"box":{"x":70,"y":664,"width":798,"height":12}},{"id":"c7fba4f3-a996-4cc2-9b7c-f72c5be1f68f","block_type":"box","text":"suppor t to U.S. Government-sponsored instrumentalities if it is not obligated to do so by law. Cer tain U.S. Treasury","page_number":107,"box":{"x":69,"y":680,"width":822,"height":11}},{"id":"57af4099-2072-446a-b560-ce3abb8fa5dd","block_type":"box","text":"and agency securities may be held by trusts that issue par ticipation cer tificates (such as Treasury income growth","page_number":107,"box":{"x":69,"y":695,"width":809,"height":11}},{"id":"86b89d76-9fc7-4c43-8906-7724f2308566","block_type":"box","text":"receipts and cer tificates of accrual on Treasury cer tificates). These cer tificates, as well as Treasury receipts and","page_number":107,"box":{"x":69,"y":710,"width":805,"height":11}},{"id":"e8b9e11e-c008-4bfb-97e3-76ded6754c81","block_type":"box","text":"other stripped securities, represent beneficial ownership interests in either future interest payments or the future","page_number":107,"box":{"x":69,"y":725,"width":807,"height":11}},{"id":"b78fef20-8fa3-417f-ab20-2fbe73b7158a","block_type":"box","text":"principal payments on U.S. Government obligations. These instruments are issued at a discount to their “face value”","page_number":107,"box":{"x":70,"y":740,"width":832,"height":11}},{"id":"9f810694-7aab-4a6e-b713-6417f60a5e8f","block_type":"box","text":"and may (par ticularly in the case of stripped mor tgage-backed securities) exhibit greater price volatility than ordinary","page_number":107,"box":{"x":69,"y":755,"width":829,"height":11}},{"id":"0ea3a767-294c-4dcc-819a-68b9d395e367","block_type":"box","text":"debt securities because of the manner in which their principal and interest are returned to investors.","page_number":107,"box":{"x":69,"y":770,"width":716,"height":11}},{"id":"a90ed55d-fea3-496b-b12d-924d7d491523","block_type":"box","text":"Examples of the types of U.S. Government obligations that may be held by the Funds include U.S. Treasury Bills,","page_number":107,"box":{"x":102,"y":793,"width":800,"height":11}},{"id":"2ec1057b-85dd-40ea-9cb0-6862c4b5eb34","block_type":"box","text":"Treasury Notes and Treasury Bonds and the obligations of the Federal Housing Administration, Farmers Home","page_number":107,"box":{"x":68,"y":808,"width":785,"height":11}},{"id":"04c491c9-676d-453d-9b85-ad89908b57ff","block_type":"box","text":"Administration, Expor t-Impor t Bank of the United States, Small Business Administration, Ginnie Mae, Fannie Mae,","page_number":107,"box":{"x":68,"y":823,"width":813,"height":11}},{"id":"af92923c-9a6b-4942-ab19-1abc226984d0","block_type":"box","text":"Federal Financing Bank, General Services Administration, Student Loan Marketing Association, Central Bank for","page_number":107,"box":{"x":70,"y":838,"width":794,"height":12}},{"id":"a1d1b4ea-44b7-42f3-8229-9987b45710a8","block_type":"box","text":"Cooperatives, Federal Home Loan Banks, Freddie Mac, Federal Intermediate Credit Banks, Federal Land Banks, Farm","page_number":107,"box":{"x":69,"y":854,"width":835,"height":10}},{"id":"86c61474-42f1-4758-b4d9-9c2108a5bee1","block_type":"box","text":"Credit Banks System, Maritime Administration, Tennessee Valley Authority and Washington D.C. Armory Board. The","page_number":107,"box":{"x":69,"y":869,"width":818,"height":11}},{"id":"5e7a8b94-728b-4dcc-a4a9-b740db4e5062","block_type":"box","text":"Funds may also invest in mor tgage-related securities issued or guaranteed by U.S. Government agencies and","page_number":107,"box":{"x":70,"y":884,"width":777,"height":11}},{"id":"7b960280-2044-45d5-acbd-8c79e32608ef","block_type":"box","text":"instrumentalities, including such instruments as obligations of Ginnie Mae, Fannie Mae and Freddie Mac.","page_number":107,"box":{"x":70,"y":899,"width":749,"height":11}},{"id":"73a4315f-04ed-4dd0-ac88-4196b37dd404","block_type":"box","text":"II-76","page_number":107,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"28f6a231-5c60-4cc5-b69a-73678f56f6c8","block_type":"box","text":"NM1026U-5982568-107/232","page_number":107,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"eed2a9a7-701e-407c-866f-8903218cde44","block_type":"box","text":"U.S. Treasury Obligations.","page_number":108,"box":{"x":103,"y":45,"width":183,"height":11}},{"id":"a44c6918-2507-4c4b-8805-994208f4d01b","block_type":"box","text":"Treasury obligations may differ in their interest rates, maturities, times of issuance","page_number":108,"box":{"x":292,"y":45,"width":593,"height":11}},{"id":"0276fbbf-cfb4-4dbc-a10e-08436a55f485","block_type":"box","text":"and other characteristics. Obligations of U.S. Government agencies and authorities are suppor ted by varying degrees","page_number":108,"box":{"x":69,"y":60,"width":835,"height":11}},{"id":"2489a818-4d84-4ed6-b9e7-90f4efe2afbf","block_type":"box","text":"of credit but generally are not backed by the full faith and credit of the U.S. Government. No assurance can be given","page_number":108,"box":{"x":69,"y":75,"width":827,"height":11}},{"id":"512670c2-6199-4462-bda9-1f7f16f270e1","block_type":"box","text":"that the U.S. Government will provide financial suppor t to its agencies and authorities if it is not obligated by law to","page_number":108,"box":{"x":68,"y":90,"width":823,"height":11}},{"id":"e2c76f87-5719-4c03-a143-12d32fb4246f","block_type":"box","text":"do so.","page_number":108,"box":{"x":69,"y":105,"width":42,"height":9}},{"id":"e1a01886-410d-4b40-aaef-7e095b4c3d02","block_type":"box","text":"U.S. Treasury Rolls","page_number":108,"box":{"x":102,"y":128,"width":139,"height":11}},{"id":"6278765b-66ac-40a7-aeef-2627ec64df3d","block_type":"box","text":".","page_number":108,"box":{"x":241,"y":135,"width":3,"height":2}},{"id":"6e04a66e-bcb3-4188-9468-92bab491322f","block_type":"box","text":"Cer tain Funds may invest in U.S. Treasury rolls. In a U.S. Treasury roll transaction, the Fund","page_number":108,"box":{"x":250,"y":128,"width":656,"height":11}},{"id":"a1d1698b-0ce4-4eed-ae34-b056996e548b","block_type":"box","text":"sells a treasury security to a counterpar ty with a simultaneous agreement to repurchase the same security at an","page_number":108,"box":{"x":69,"y":143,"width":804,"height":11}},{"id":"a37d9512-fed8-445c-8154-40fabe923625","block_type":"box","text":"agreed upon price and future settlement date. U.S. Treasury roll transactions may incrementally adjust the average","page_number":108,"box":{"x":69,"y":158,"width":820,"height":11}},{"id":"a683da38-1416-44bf-bcb0-9bdea4699712","block_type":"box","text":"maturity of a Fund’s por tfolio and increase the interest yield on the Fund’s por tfolio by extending the average maturity","page_number":108,"box":{"x":69,"y":173,"width":840,"height":11}},{"id":"401a007c-103b-42cd-8552-969633e36d79","block_type":"box","text":"of the por tfolio in a normal yield curve environment. During the period before the settlement date of a U.S. Treasury","page_number":108,"box":{"x":69,"y":188,"width":828,"height":12}},{"id":"d666fb11-8106-4df3-bc3e-6b9b86273168","block_type":"box","text":"roll, a Fund continues to earn interest on the securities it is selling; however, it does not earn interest on the","page_number":108,"box":{"x":69,"y":204,"width":775,"height":11}},{"id":"55bbfd6f-4aa3-4dc2-b5c6-c3a3765d8db1","block_type":"box","text":"securities it is purchasing until after the settlement date. A Fund could suffer an oppor tunity loss if the counterpar ty","page_number":108,"box":{"x":69,"y":218,"width":829,"height":12}},{"id":"0d4abfa4-2b02-41a8-95f6-6e62aaf75df5","block_type":"box","text":"to the U.S. Treasury roll transaction failed to per form its obligations on the settlement date.","page_number":108,"box":{"x":68,"y":234,"width":657,"height":11}},{"id":"2754d2b5-de20-4b4a-8b7a-aff2ce57cd5a","block_type":"box","text":"The market value of the securities that a Fund is required to purchase may decline below the agreed upon","page_number":108,"box":{"x":101,"y":256,"width":756,"height":12}},{"id":"6c4ac782-1d73-42df-a140-48550b72d983","block_type":"box","text":"purchase price of those securities. U.S. Treasury rolls are speculative techniques that can be deemed to involve","page_number":108,"box":{"x":70,"y":271,"width":800,"height":12}},{"id":"4eab635b-025d-4383-99cb-96358dcf5296","block_type":"box","text":"leverage. There is no assurance that U.S. Treasury rolls can be successfully employed.","page_number":108,"box":{"x":70,"y":286,"width":617,"height":12}},{"id":"2e78b0cc-4d2a-4057-8a7a-1b729da5d929","block_type":"box","text":"Utility Industries.","page_number":108,"box":{"x":102,"y":309,"width":124,"height":11}},{"id":"4d366432-5ebe-453d-ad8e-b4298c4ff144","block_type":"box","text":"Risks that are intrinsic to the utility industries include difficulty in obtaining an adequate return","page_number":108,"box":{"x":233,"y":309,"width":674,"height":11}},{"id":"c457c8c1-d633-4250-8067-f33a3a3c60eb","block_type":"box","text":"on invested capital, difficulty in financing large construction programs during an inflationary period, restrictions on","page_number":108,"box":{"x":69,"y":324,"width":812,"height":12}},{"id":"c654cb29-36bd-404a-bd0a-b25f3c856de8","block_type":"box","text":"operations and increased cost and delays attributable to environmental considerations and regulation, difficulty in","page_number":108,"box":{"x":69,"y":339,"width":812,"height":12}},{"id":"bc8366f8-01f5-4e02-807e-ccd2dca8e217","block_type":"box","text":"raising capital in adequate amounts on reasonable terms in periods of high inflation and unsettled capital markets,","page_number":108,"box":{"x":69,"y":355,"width":821,"height":11}},{"id":"ac79730d-78a8-4d82-a72f-1bd1a8a4bf76","block_type":"box","text":"technological innovations that may render existing plants, equipment or products obsolete, the potential impact of","page_number":108,"box":{"x":68,"y":370,"width":815,"height":11}},{"id":"bd42caad-ff49-4633-a1a7-3e9c9d810ea4","block_type":"box","text":"natural or man-made disasters, increased costs and reduced availability of cer tain types of fuel, occasional reduced","page_number":108,"box":{"x":69,"y":385,"width":827,"height":11}},{"id":"209d85f3-0553-47c7-b8ed-bb8eb8d6b72c","block_type":"box","text":"availability and high costs of natural gas for resale, the effects of energy conservation, the effects of a national","page_number":108,"box":{"x":69,"y":400,"width":795,"height":11}},{"id":"f83fb789-95c5-4c38-b73d-84bd11526326","block_type":"box","text":"energy policy and lengthy delays and greatly increased costs and other problems associated with the design,","page_number":108,"box":{"x":69,"y":415,"width":774,"height":11}},{"id":"2d3f7094-6eab-4e17-9fab-a8103af627e4","block_type":"box","text":"construction, licensing, regulation and operation of nuclear facilities for electric generation, including, among other","page_number":108,"box":{"x":69,"y":430,"width":817,"height":11}},{"id":"590fa7d8-062c-4845-b308-5ee195b3bdae","block_type":"box","text":"considerations, the problems associated with the use of radioactive materials and the disposal of radioactive wastes.","page_number":108,"box":{"x":69,"y":445,"width":839,"height":11}},{"id":"edf6eea8-6ed0-44df-9a1a-b1e8192ab8ec","block_type":"box","text":"There are substantial differences among the regulatory practices and policies of various jurisdictions, and any given","page_number":108,"box":{"x":68,"y":460,"width":827,"height":12}},{"id":"3a29ef6b-7136-4772-a7a8-7d6dd78a5cfc","block_type":"box","text":"regulatory agency may make major shifts in policy from time to time. There is no assurance that regulatory","page_number":108,"box":{"x":69,"y":475,"width":761,"height":12}},{"id":"e479a39c-303a-49fe-a7a8-2d1742799d74","block_type":"box","text":"authorities will, in the future, grant rate increases or that such increases will be adequate to permit the payment of","page_number":108,"box":{"x":69,"y":491,"width":821,"height":11}},{"id":"5883d74a-923e-49f4-b164-a84072020f06","block_type":"box","text":"dividends on common stocks issued by a utility company. Additionally, existing and possible future regulatory","page_number":108,"box":{"x":69,"y":506,"width":777,"height":11}},{"id":"922f8364-5cd3-4741-9b1b-300915e332ff","block_type":"box","text":"legislation may make it even more difficult for utilities to obtain adequate relief. Cer tain of the issuers of securities","page_number":108,"box":{"x":70,"y":521,"width":820,"height":11}},{"id":"12d0aa1f-04fe-45fc-8e53-4d07be9dab0a","block_type":"box","text":"held in the Fund’s por tfolio may own or operate nuclear generating facilities. Governmental authorities may from time","page_number":108,"box":{"x":69,"y":536,"width":835,"height":11}},{"id":"a8b108d5-36f6-4485-a5da-f1f0113e1e05","block_type":"box","text":"to time review existing policies and impose additional requirements governing the licensing, construction and","page_number":108,"box":{"x":68,"y":551,"width":778,"height":11}},{"id":"62fe59b0-0019-4170-93d0-81f46d0ab1a6","block_type":"box","text":"operation of nuclear power plants. Prolonged changes in climatic conditions can also have a significant impact on","page_number":108,"box":{"x":69,"y":566,"width":808,"height":11}},{"id":"4b7d1038-7915-434c-b59e-95d4ef6d0a14","block_type":"box","text":"both the revenues of an electric and gas utility as well as the expenses of a utility, par ticularly a hydro-based electric","page_number":108,"box":{"x":69,"y":581,"width":831,"height":12}},{"id":"7d4fb6a7-1092-49b6-ace7-1deb3059b725","block_type":"box","text":"utility.","page_number":108,"box":{"x":69,"y":597,"width":39,"height":11}},{"id":"67f106f4-dfb0-4915-a529-1b78b2b67df5","block_type":"box","text":"Companies in the utilities sector may be adversely affected by changes in exchange rates, domestic and","page_number":108,"box":{"x":102,"y":619,"width":744,"height":11}},{"id":"8d307298-430a-4459-b0b0-f1e3c5bd46ec","block_type":"box","text":"international competition, and governmental limitations on rates charged to customers. The value of regulated utility","page_number":108,"box":{"x":70,"y":634,"width":828,"height":12}},{"id":"a2de6ddc-1f8c-4f5a-8778-ed6dc3092c14","block_type":"box","text":"debt securities and, to a lesser extent, equity securities, tends to have an inverse relationship to the movement of","page_number":108,"box":{"x":69,"y":649,"width":817,"height":12}},{"id":"9dd01551-3e76-4d37-a5ed-565757f96b93","block_type":"box","text":"interest rates and therefore may lead to volatility in per formance.","page_number":108,"box":{"x":70,"y":664,"width":464,"height":12}},{"id":"4f3d16f6-af83-4738-9e0f-51e62068beeb","block_type":"box","text":"Utility companies in the United States and in foreign countries are generally subject to regulation. In the United","page_number":108,"box":{"x":102,"y":687,"width":789,"height":11}},{"id":"4c246066-f6ce-4710-82fe-6ddac2614f51","block_type":"box","text":"States, most utility companies are regulated by state and/or federal authorities. Such regulation is intended to","page_number":108,"box":{"x":69,"y":702,"width":790,"height":12}},{"id":"c283bf33-283c-4c06-8bed-e1c2bc211075","block_type":"box","text":"ensure appropriate standards of service and adequate capacity to meet public demand. Generally, prices are also","page_number":108,"box":{"x":69,"y":717,"width":811,"height":12}},{"id":"2ec68a81-0538-4c64-99c0-08ee0221b451","block_type":"box","text":"regulated in the United States and in foreign countries with the intention of protecting the public while ensuring that","page_number":108,"box":{"x":69,"y":732,"width":824,"height":12}},{"id":"a0357d1c-1584-4d4d-829d-ec40fbebe9e2","block_type":"box","text":"the rate of return earned by utility companies is sufficient to allow them to attract capital in order to grow and","page_number":108,"box":{"x":68,"y":748,"width":781,"height":11}},{"id":"92392a5f-af42-41ac-8c47-549fa0b6a33a","block_type":"box","text":"continue to provide appropriate services. There can be no assurance that such pricing policies or rates of return will","page_number":108,"box":{"x":69,"y":763,"width":826,"height":11}},{"id":"a7bdd005-b807-4932-9af7-4bdfc720b54f","block_type":"box","text":"continue in the future.","page_number":108,"box":{"x":69,"y":778,"width":156,"height":9}},{"id":"9454d7f2-f0b5-4093-b75f-ec68b9ad24bf","block_type":"box","text":"The nature of regulation of the utility industries continues to evolve both in the United States and in foreign","page_number":108,"box":{"x":101,"y":801,"width":763,"height":11}},{"id":"e45455ea-1a0b-4d4f-8005-d656eb7637ba","block_type":"box","text":"countries. In recent years, changes in regulation in the United States increasingly have allowed utility companies to","page_number":108,"box":{"x":69,"y":816,"width":820,"height":11}},{"id":"5aecea23-68b9-4018-ab50-ea209193a750","block_type":"box","text":"provide services and products outside their traditional geographic areas and lines of business, creating new areas of","page_number":108,"box":{"x":70,"y":831,"width":834,"height":11}},{"id":"1b6daa58-d44e-4bdb-a198-e6cebfec1d5a","block_type":"box","text":"competition within the industries. In some instances, utility companies are operating on an unregulated basis.","page_number":108,"box":{"x":69,"y":846,"width":784,"height":11}},{"id":"3b4282fa-84f2-4676-8e6e-dd1b20dd5dbd","block_type":"box","text":"Because of trends toward deregulation and the evolution of independent power producers as well as new entrants to","page_number":108,"box":{"x":70,"y":861,"width":830,"height":11}},{"id":"da2283fe-8dcd-4b97-819c-a9d665e3bedf","block_type":"box","text":"the field of telecommunications, non-regulated providers of utility services have become a significant par t of their","page_number":108,"box":{"x":68,"y":876,"width":809,"height":11}},{"id":"c4ea123e-ab3d-40d1-8739-89595daf2ee3","block_type":"box","text":"respective industries. The Manager believes that the emergence of competition and deregulation will result in cer tain","page_number":108,"box":{"x":69,"y":891,"width":834,"height":12}},{"id":"30fb6788-0e0c-44c5-abd6-bd32ba390e8f","block_type":"box","text":"utility companies being able to earn more than their traditional regulated rates of return, while others may be forced","page_number":108,"box":{"x":69,"y":906,"width":825,"height":12}},{"id":"f1996b49-6dd9-49f4-9cca-a4bbf828c31c","block_type":"box","text":"II-77","page_number":108,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"fb5b7bd8-a241-43ea-b164-ecd544ede49d","block_type":"box","text":"NM1026U-5982568-108/232","page_number":108,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"6b6a6a6b-e1f0-40fc-9cf9-4fc3e3e06035","block_type":"box","text":"to defend their core business from increased competition and may be less profitable. Reduced profitability, as well as","page_number":109,"box":{"x":68,"y":45,"width":840,"height":11}},{"id":"682ba058-50c6-45ce-80a3-bb617fa39c67","block_type":"box","text":"new uses of funds (such as for expansion, operations or stock buybacks) could result in cuts in dividend payout","page_number":109,"box":{"x":69,"y":60,"width":796,"height":11}},{"id":"7dcc72bd-96b4-40e3-b580-96d9cc810760","block_type":"box","text":"rates. As deregulation allows utility companies to diversify outside of their original geographic regions and their","page_number":109,"box":{"x":69,"y":75,"width":790,"height":11}},{"id":"5449a1a2-5a3d-4106-9135-5bcbe33402e5","block_type":"box","text":"traditional lines of business, utility companies may engage in riskier ventures. Therefore, deregulation may eliminate","page_number":109,"box":{"x":68,"y":90,"width":831,"height":11}},{"id":"1b7c0104-4b36-4d4d-84e2-11abcfdd24c9","block_type":"box","text":"restrictions on the maximum level of profits of cer tain utility companies, but may also subject these companies to","page_number":109,"box":{"x":69,"y":105,"width":812,"height":11}},{"id":"4bf2a4ae-e635-4fae-96d6-f080eb78fa6b","block_type":"box","text":"greater risk of loss. The Manager seeks to take advantage of favorable investment oppor tunities that may arise from","page_number":109,"box":{"x":68,"y":120,"width":833,"height":12}},{"id":"058e9e36-5e28-4be7-8df3-608177f290f5","block_type":"box","text":"these structural changes. Of course, there can be no assurance that favorable developments will occur in the future.","page_number":109,"box":{"x":68,"y":135,"width":831,"height":12}},{"id":"3dd2b11e-b2ad-4e19-9119-0051e2367b05","block_type":"box","text":"Foreign utility companies are also subject to regulation, although such regulations may or may not be","page_number":109,"box":{"x":102,"y":158,"width":720,"height":11}},{"id":"73c7a3fb-e871-4426-abbb-dc9c68a1f06c","block_type":"box","text":"comparable to those in the United States. Foreign utility companies may be more heavily regulated by their respective","page_number":109,"box":{"x":69,"y":173,"width":838,"height":11}},{"id":"cbf842fc-7077-41fa-9f41-1401196e59dd","block_type":"box","text":"governments than utilities in the United States and, as in the United States, generally are required to seek","page_number":109,"box":{"x":68,"y":188,"width":762,"height":12}},{"id":"08b16616-3d5c-4f7f-a8dd-f67ab811bacb","block_type":"box","text":"government approval for rate increases. In addition, many foreign utilities use fuels that may cause more pollution","page_number":109,"box":{"x":68,"y":203,"width":815,"height":12}},{"id":"c1d137e2-374a-4771-a703-9ffc84ff056a","block_type":"box","text":"than those used in the United States, which may require such utilities to invest in pollution control equipment to","page_number":109,"box":{"x":68,"y":219,"width":801,"height":11}},{"id":"fccf6a1b-e2c3-4ddf-829c-099d7eb03c34","block_type":"box","text":"meet any proposed pollution restrictions. Foreign regulatory systems vary from country to country and may evolve in","page_number":109,"box":{"x":69,"y":234,"width":828,"height":11}},{"id":"799e9af9-4c6f-4442-8d18-42890c1a3a6a","block_type":"box","text":"ways different from regulation in the United States.","page_number":109,"box":{"x":68,"y":249,"width":365,"height":11}},{"id":"4b36c40d-3d6d-4eb4-9860-7761a7f2282a","block_type":"box","text":"A Fund’s investment policies are designed to enable it to capitalize on evolving investment oppor tunities","page_number":109,"box":{"x":101,"y":272,"width":745,"height":11}},{"id":"674b8cc3-6518-4b23-a158-2c2888b85023","block_type":"box","text":"throughout the world. For example, the rapid growth of cer tain foreign economies will necessitate expansion of","page_number":109,"box":{"x":68,"y":286,"width":790,"height":12}},{"id":"537d1ed4-4924-42e0-9fe6-2723ed5359b3","block_type":"box","text":"capacity in the utility industries in those countries. Although many foreign utility companies currently are government","page_number":109,"box":{"x":69,"y":302,"width":833,"height":11}},{"id":"22172fc9-b0ce-48db-adb0-489dd5b6b81b","block_type":"box","text":"owned, thereby limiting current investment oppor tunities for a Fund, the Manager believes that, in order to attract","page_number":109,"box":{"x":69,"y":317,"width":810,"height":11}},{"id":"80667be0-f597-4a38-bdc5-7397615f4d02","block_type":"box","text":"significant capital for growth, foreign governments are likely to seek global investors through the privatization of their","page_number":109,"box":{"x":69,"y":332,"width":831,"height":11}},{"id":"f539f60c-06b8-45a6-8c31-68ba210b885f","block_type":"box","text":"utility industries. Privatization, which refers to the trend toward investor ownership of assets rather than government","page_number":109,"box":{"x":69,"y":347,"width":828,"height":11}},{"id":"ad94655b-337e-41db-a26b-02f03c80865d","block_type":"box","text":"ownership, is expected to occur in newer, faster-growing economies and in mature economies. Of course, there is no","page_number":109,"box":{"x":69,"y":362,"width":832,"height":11}},{"id":"4f1d85a5-3c30-4617-a25f-e6301f5c5053","block_type":"box","text":"assurance that such favorable developments will occur or that investment oppor tunities in foreign markets will","page_number":109,"box":{"x":69,"y":377,"width":786,"height":12}},{"id":"37f43248-cce9-4c3f-8a14-b04448e39659","block_type":"box","text":"increase.","page_number":109,"box":{"x":70,"y":393,"width":63,"height":8}},{"id":"39910d07-b215-45cb-8c53-d6938164b3a4","block_type":"box","text":"The revenues of domestic and foreign utility companies generally reflect the economic growth and development","page_number":109,"box":{"x":101,"y":415,"width":793,"height":11}},{"id":"5cbd7386-04ac-46bc-85a3-8d6d2e293ad0","block_type":"box","text":"in the geographic areas in which they do business. The Manager will take into account anticipated economic growth","page_number":109,"box":{"x":70,"y":430,"width":821,"height":11}},{"id":"f7679c84-fb19-4c8d-9816-f460231e29ed","block_type":"box","text":"rates and other economic developments when selecting securities of utility companies.","page_number":109,"box":{"x":69,"y":445,"width":619,"height":12}},{"id":"c0e9600e-d1aa-446f-a848-1707f05f7510","block_type":"box","text":"Electric.","page_number":109,"box":{"x":102,"y":468,"width":54,"height":9}},{"id":"cb40cbed-bcc8-47c0-88b7-de63d1165da6","block_type":"box","text":"The electric utility industry consists of companies that are engaged principally in the generation,","page_number":109,"box":{"x":163,"y":468,"width":684,"height":11}},{"id":"e1463848-2de1-42cc-b25a-3e77db545413","block_type":"box","text":"transmission and sale of electric energy, although many also provide other energy-related services. In the past,","page_number":109,"box":{"x":68,"y":483,"width":793,"height":11}},{"id":"ee473e9c-8c0a-483e-9ab3-f66a038cdabb","block_type":"box","text":"electric utility companies, in general, have been favorably affected by lower fuel and financing costs and the full or","page_number":109,"box":{"x":69,"y":498,"width":814,"height":11}},{"id":"48c00d9f-e880-4c3d-9344-04ab4f79a035","block_type":"box","text":"near completion of major construction programs. In addition, many of these companies have generated cash flows in","page_number":109,"box":{"x":69,"y":513,"width":833,"height":12}},{"id":"514ca5d9-2aed-4a91-8b1a-3cc8c72d4552","block_type":"box","text":"excess of current operating expenses and construction expenditures, permitting some degree of diversification into","page_number":109,"box":{"x":69,"y":528,"width":821,"height":12}},{"id":"1194bc2e-fde7-473d-8bc5-83c7cbbb431b","block_type":"box","text":"unregulated businesses. Some electric utilities have also taken advantage of the right to sell power outside of their","page_number":109,"box":{"x":69,"y":543,"width":823,"height":12}},{"id":"64ca06e1-9c52-4eff-9d49-eed259751244","block_type":"box","text":"traditional geographic areas. Electric utility companies have historically been subject to the risks associated with","page_number":109,"box":{"x":68,"y":559,"width":803,"height":11}},{"id":"95b74685-a2cd-435c-b721-7e4bf0b652d9","block_type":"box","text":"increases in fuel and other operating costs, high interest costs on borrowings needed for capital construction","page_number":109,"box":{"x":70,"y":574,"width":778,"height":11}},{"id":"5962349a-1a35-4032-a3e9-4001605a1684","block_type":"box","text":"programs, costs associated with compliance with environmental and safety regulations and changes in the regulatory","page_number":109,"box":{"x":70,"y":589,"width":836,"height":11}},{"id":"c4cd4eb7-f9f1-40eb-86b9-c4f72ab64252","block_type":"box","text":"climate. As interest rates declined, many utilities refinanced high cost debt and in doing so improved their fixed","page_number":109,"box":{"x":69,"y":604,"width":793,"height":11}},{"id":"fa57a381-9e9f-4c12-a803-c4f35d156b5f","block_type":"box","text":"charges coverage. Regulators, however, lowered allowed rates of return as interest rates declined and thereby","page_number":109,"box":{"x":69,"y":619,"width":786,"height":11}},{"id":"92d26425-861f-48b4-a67f-493e3c4574ff","block_type":"box","text":"caused the benefits of the rate declines to be shared wholly or in par t with customers. In a period of rising interest","page_number":109,"box":{"x":69,"y":634,"width":819,"height":12}},{"id":"2b66119e-46a4-46db-9fed-4ba26b4b40cd","block_type":"box","text":"rates, the allowed rates of return may not keep pace with the utilities’ increased costs. The construction and","page_number":109,"box":{"x":69,"y":649,"width":775,"height":12}},{"id":"0f418f49-e872-49b8-9aeb-ef33623f78f5","block_type":"box","text":"operation of nuclear power facilities are subject to strict scrutiny by, and evolving regulations of, the Nuclear","page_number":109,"box":{"x":69,"y":664,"width":770,"height":12}},{"id":"5c660a7a-665c-40c4-8402-dc094ee35cfe","block_type":"box","text":"Regulatory Commission and state agencies which have comparable jurisdiction. Strict scrutiny might result in higher","page_number":109,"box":{"x":70,"y":680,"width":826,"height":11}},{"id":"0389b2ee-c602-48ea-b0d0-884f72a94d91","block_type":"box","text":"operating costs and higher capital expenditures, with the risk that the regulators may disallow inclusion of these","page_number":109,"box":{"x":69,"y":695,"width":800,"height":11}},{"id":"f474cdf1-198b-4754-9000-793a4628104c","block_type":"box","text":"costs in rate authorizations or the risk that a company may not be permitted to operate or complete construction of a","page_number":109,"box":{"x":69,"y":710,"width":836,"height":11}},{"id":"a1290a67-97c4-4367-ae99-625f0b8b3497","block_type":"box","text":"facility. In addition, operators of nuclear power plants may be subject to significant costs for disposal of nuclear fuel","page_number":109,"box":{"x":68,"y":725,"width":826,"height":11}},{"id":"a7ba3460-70d5-4fa7-bf5a-84ab362ac8ad","block_type":"box","text":"and for decommissioning such plants.","page_number":109,"box":{"x":69,"y":740,"width":270,"height":11}},{"id":"f795f659-5861-461e-a3d6-c5753e377452","block_type":"box","text":"The rating agencies look closely at the business profile of utilities. Ratings for companies are expected to be","page_number":109,"box":{"x":101,"y":763,"width":776,"height":11}},{"id":"975148eb-4f31-4bda-88c8-72684ade4d39","block_type":"box","text":"impacted to a greater extent in the future by the division of their asset base. Electric utility companies that focus","page_number":109,"box":{"x":70,"y":778,"width":802,"height":11}},{"id":"2daec280-7ead-4c68-a251-360cc9088b0a","block_type":"box","text":"more on the generation of electricity may be assigned less favorable ratings as this business is expected to be","page_number":109,"box":{"x":69,"y":793,"width":791,"height":11}},{"id":"93ff0c1e-3df4-4ac7-af21-48c3bd62223d","block_type":"box","text":"competitive and the least regulated. On the other hand, companies that focus on transmission and distribution, which","page_number":109,"box":{"x":69,"y":808,"width":839,"height":11}},{"id":"bb7642f5-bed4-4f70-b049-10750cdc4646","block_type":"box","text":"is expected to be the least competitive and the more regulated par t of the business, may see higher ratings given the","page_number":109,"box":{"x":70,"y":823,"width":838,"height":12}},{"id":"d9d1dd78-63a2-414e-a7ec-04f1aeb4ee4b","block_type":"box","text":"greater predictability of cash flow.","page_number":109,"box":{"x":68,"y":838,"width":239,"height":12}},{"id":"c63d5010-35c7-421b-99d0-b36ae1fce2ac","block_type":"box","text":"A number of states are considering or have enacted deregulation proposals. The introduction of competition into","page_number":109,"box":{"x":101,"y":861,"width":801,"height":11}},{"id":"46cf451f-5ec2-475d-ba58-765a0d9f53fb","block_type":"box","text":"the industry as a result of such deregulation has at times resulted in lower revenue, lower credit ratings, increased","page_number":109,"box":{"x":68,"y":876,"width":821,"height":11}},{"id":"2d5354ea-652a-4905-80c7-88f66962b58b","block_type":"box","text":"default risk, and lower electric utility security prices. Such increased competition may also cause long-term contracts,","page_number":109,"box":{"x":69,"y":891,"width":835,"height":12}},{"id":"8d68d59d-3b79-49c9-b2a8-3caf4f213958","block_type":"box","text":"which electric utilities previously entered into to buy power, to become “stranded assets” which have no economic","page_number":109,"box":{"x":68,"y":907,"width":815,"height":11}},{"id":"38734cc4-47b7-4341-830b-f59d1c3b7cb5","block_type":"box","text":"II-78","page_number":109,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"a9003d83-ac90-459f-a056-e96639a92e75","block_type":"box","text":"NM1026U-5982568-109/232","page_number":109,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"91cc11fc-433e-4dee-82c9-b69e6823a4bb","block_type":"box","text":"value. Any loss associated with such contracts must be absorbed by ratepayers and investors. In addition, some","page_number":110,"box":{"x":68,"y":45,"width":803,"height":11}},{"id":"c1d2adf3-f1b1-4321-9889-1165a0bbb61e","block_type":"box","text":"electric utilities have acquired electric utilities overseas to diversify, enhance earnings and gain experience in","page_number":110,"box":{"x":69,"y":60,"width":777,"height":11}},{"id":"bc71f03a-e15d-4258-9a38-f90c4902a389","block_type":"box","text":"operating in a deregulated environment. In some instances, such acquisitions have involved significant borrowings,","page_number":110,"box":{"x":69,"y":75,"width":819,"height":11}},{"id":"5d9ac871-f32a-40d5-9778-d086fb8ee04e","block_type":"box","text":"which have burdened the acquirer’s balance sheet. There is no assurance that current deregulation proposals will be","page_number":110,"box":{"x":68,"y":90,"width":835,"height":11}},{"id":"9f6b5e37-63df-4b01-b7c9-4d0a7a61d7ec","block_type":"box","text":"adopted. However, deregulation in any form could significantly impact the electric utilities industry.","page_number":110,"box":{"x":69,"y":105,"width":700,"height":11}},{"id":"74368904-6d99-400d-8e37-6257cd3bc1e0","block_type":"box","text":"Telecommunications.","page_number":110,"box":{"x":103,"y":128,"width":147,"height":9}},{"id":"cfd8dbfe-6b96-4192-8035-ab308f4c1485","block_type":"box","text":"The telecommunications industry today includes both traditional telephone companies, with","page_number":110,"box":{"x":256,"y":128,"width":652,"height":11}},{"id":"670b071e-bb14-499f-9b22-f35b3bd0bb49","block_type":"box","text":"a history of broad market coverage and highly regulated businesses, and cable companies, which began as small,","page_number":110,"box":{"x":69,"y":143,"width":813,"height":11}},{"id":"5e61d8c4-2c5f-4ffa-97ba-dd3063053ac3","block_type":"box","text":"lightly regulated businesses focused on limited markets. Today these two historically different businesses are","page_number":110,"box":{"x":70,"y":158,"width":782,"height":11}},{"id":"9e5afe5e-4b71-40a7-b440-cf5c455552de","block_type":"box","text":"converging in an industry that is trending toward larger, competitive national and international markets with an","page_number":110,"box":{"x":69,"y":173,"width":786,"height":11}},{"id":"528b7c46-bb0a-41df-9901-5043d0263b5f","block_type":"box","text":"emphasis on deregulation. Companies that distribute telephone services and provide access to the telephone","page_number":110,"box":{"x":69,"y":188,"width":784,"height":12}},{"id":"be4aa374-80aa-4796-ba43-602ef2ffe5ed","block_type":"box","text":"networks still comprise the greatest por tion of this segment, but non-regulated activities such as wireless telephone","page_number":110,"box":{"x":69,"y":203,"width":830,"height":12}},{"id":"70ab9459-5a6c-40fe-b12e-710544ebbf5d","block_type":"box","text":"services, paging, data transmission and processing, equipment retailing, computer software and hardware and","page_number":110,"box":{"x":69,"y":218,"width":790,"height":12}},{"id":"e5fbeb65-7309-48e1-b69f-68aaf7ec5027","block_type":"box","text":"internet services are becoming increasingly significant components as well. In par ticular, wireless and internet","page_number":110,"box":{"x":70,"y":234,"width":788,"height":11}},{"id":"26ecdcfc-ae03-4014-bfd8-ba17ac2db815","block_type":"box","text":"telephone services continue to gain market share at the expense of traditional telephone companies. The presence","page_number":110,"box":{"x":68,"y":249,"width":825,"height":11}},{"id":"8656a137-1b1d-44fb-afaf-bf9e75f7867a","block_type":"box","text":"of unregulated companies in this industry and the entry of traditional telephone companies into unregulated or less","page_number":110,"box":{"x":69,"y":264,"width":823,"height":11}},{"id":"e12780bc-9ea7-4c0f-a8b0-67985befa72e","block_type":"box","text":"regulated businesses provide significant investment oppor tunities with companies that may increase their earnings","page_number":110,"box":{"x":69,"y":279,"width":821,"height":11}},{"id":"5cf2ce84-fb1f-4ec3-8e62-d19b4df3b271","block_type":"box","text":"at faster rates than had been allowed in traditional regulated businesses. Still, increasing competition, technological","page_number":110,"box":{"x":69,"y":294,"width":830,"height":11}},{"id":"425315f6-92ae-4056-84c4-fba2af0aeb6b","block_type":"box","text":"innovations and other structural changes could adversely affect the profitability of such utilities and the growth rate","page_number":110,"box":{"x":70,"y":309,"width":821,"height":11}},{"id":"8c76e9db-a7fd-4186-8bcf-8d83ddc57ecd","block_type":"box","text":"of their dividends. Given mergers and proposed legislation and enforcement changes, it is likely that both traditional","page_number":110,"box":{"x":69,"y":324,"width":827,"height":12}},{"id":"a9711386-14c1-4fda-9eea-5ab427d8761e","block_type":"box","text":"telephone companies and cable companies will continue to provide an expanding range of utility services to both","page_number":110,"box":{"x":68,"y":339,"width":804,"height":12}},{"id":"2343a547-738b-4897-a22b-f4c27e1f66c1","block_type":"box","text":"residential, corporate and governmental customers.","page_number":110,"box":{"x":69,"y":355,"width":367,"height":11}},{"id":"cc39d913-0fff-41c8-9ade-f9c2da0bf585","block_type":"box","text":"Gas.","page_number":110,"box":{"x":102,"y":377,"width":31,"height":9}},{"id":"c1cc4fae-6131-4215-be10-d1b885815296","block_type":"box","text":"Gas transmission companies and gas distribution companies are undergoing significant changes. In the","page_number":110,"box":{"x":139,"y":377,"width":740,"height":12}},{"id":"043fdfc6-20a2-4069-aed4-d27dd88243e9","block_type":"box","text":"United States, interstate transmission companies are regulated by the Federal Energy Regulatory Commission, which","page_number":110,"box":{"x":70,"y":392,"width":834,"height":12}},{"id":"e83aa867-04cf-41e2-8777-d16188c6e5c2","block_type":"box","text":"is reducing its regulation of the industry. Many companies have diversified into oil and gas exploration and","page_number":110,"box":{"x":70,"y":407,"width":756,"height":12}},{"id":"2165c1ee-2063-4c93-8ab2-31f936527d38","block_type":"box","text":"development, making returns more sensitive to energy prices. In the recent decade, gas utility companies have been","page_number":110,"box":{"x":69,"y":423,"width":831,"height":11}},{"id":"72d0a4d6-eaff-4b86-80a3-dea5c4d24682","block_type":"box","text":"adversely affected by disruptions in the oil industry and have also been affected by increased concentration and","page_number":110,"box":{"x":69,"y":438,"width":801,"height":11}},{"id":"8f13938e-955b-46fc-a82f-bdda77703afb","block_type":"box","text":"competition. In the opinion of the Manager, however, environmental considerations could improve the gas industry","page_number":110,"box":{"x":69,"y":453,"width":815,"height":11}},{"id":"f5792b2a-7583-4955-8f0d-2c2176f935bd","block_type":"box","text":"outlook in the future. For example, natural gas is the cleanest of the hydrocarbon fuels, and this may result in","page_number":110,"box":{"x":69,"y":468,"width":782,"height":11}},{"id":"55ed70df-6998-43ef-94fc-30e0b1a27a6d","block_type":"box","text":"incremental shifts in fuel consumption toward natural gas and away from oil and coal, even for electricity generation.","page_number":110,"box":{"x":70,"y":483,"width":829,"height":11}},{"id":"7f076897-90c2-4822-84ca-82088ab7ef36","block_type":"box","text":"However, technological or regulatory changes within the industry may delay or prevent this result.","page_number":110,"box":{"x":70,"y":498,"width":691,"height":11}},{"id":"075aff46-1572-4270-9cec-8c5466c79fa8","block_type":"box","text":"Water.","page_number":110,"box":{"x":103,"y":521,"width":42,"height":9}},{"id":"73ce00f5-ef41-4521-ba58-5018e20bc233","block_type":"box","text":"Water supply utilities are companies that collect, purify, distribute and sell water. In the United States and","page_number":110,"box":{"x":151,"y":521,"width":754,"height":11}},{"id":"cb28d75a-0e20-4405-998d-1070b06cd8fd","block_type":"box","text":"around the world the industry is highly fragmented because most of the supplies are owned by local authorities.","page_number":110,"box":{"x":69,"y":536,"width":796,"height":11}},{"id":"c9f1f934-5874-404c-8891-794593796146","block_type":"box","text":"Companies in this industry are generally mature and are experiencing little or no per capita volume growth. In the","page_number":110,"box":{"x":69,"y":551,"width":806,"height":11}},{"id":"14112d16-a9ec-4cb4-9058-936122642ac5","block_type":"box","text":"opinion of the Manager, there may be oppor tunities for cer tain companies to acquire other water utility companies","page_number":110,"box":{"x":69,"y":566,"width":814,"height":11}},{"id":"a18cb59d-98d2-41b9-9679-35aec2e033fa","block_type":"box","text":"and for foreign acquisition of domestic companies. The Manager believes that favorable investment oppor tunities","page_number":110,"box":{"x":69,"y":581,"width":808,"height":12}},{"id":"5dae84a4-92a0-464e-89fc-ddca94643e77","block_type":"box","text":"may result from consolidation of this segment. As with other utilities, however, increased regulation, increased costs","page_number":110,"box":{"x":69,"y":596,"width":832,"height":12}},{"id":"499d970b-3da2-434e-9930-a5532769d0fa","block_type":"box","text":"and potential disruptions in supply may adversely affect investments in water supply utilities.","page_number":110,"box":{"x":69,"y":612,"width":662,"height":11}},{"id":"08004803-680b-457a-9056-cb7af6d93257","block_type":"box","text":"Utility Industries Generally.","page_number":110,"box":{"x":103,"y":634,"width":186,"height":11}},{"id":"9af64ace-40d5-429c-87f3-60c6a75e1ee8","block_type":"box","text":"There can be no assurance that the positive developments noted above, including","page_number":110,"box":{"x":296,"y":634,"width":584,"height":12}},{"id":"3c1e78f1-4b62-418d-9b07-fb2ff06bc36b","block_type":"box","text":"those relating to privatization and changing regulation, will occur or that risk factors other than those noted above will","page_number":110,"box":{"x":68,"y":649,"width":837,"height":12}},{"id":"d0a5df28-a6ff-4c15-b147-a3b52ec923ab","block_type":"box","text":"not develop in the future.","page_number":110,"box":{"x":69,"y":664,"width":178,"height":11}},{"id":"45009711-50f5-4a87-954d-0c335bcf6e7a","block_type":"box","text":"When-Issued Securities, Delayed Delivery Securities and Forward Commitments.","page_number":110,"box":{"x":103,"y":687,"width":585,"height":11}},{"id":"bbf65d4b-a110-497c-ba71-931ceb454838","block_type":"box","text":"A Fund may purchase or sell","page_number":110,"box":{"x":694,"y":687,"width":200,"height":11}},{"id":"cdd31bbc-1938-40c9-b72f-284e90c093db","block_type":"box","text":"securities that it is entitled to receive on a when-issued basis. A Fund may also purchase or sell securities on a","page_number":110,"box":{"x":69,"y":703,"width":795,"height":10}},{"id":"74d3b6e2-7e27-4e80-9e2f-abe2972b3616","block_type":"box","text":"delayed delivery basis or through a forward commitment (including on a TBA (to be announced) basis). These","page_number":110,"box":{"x":69,"y":717,"width":777,"height":12}},{"id":"920e4bcd-969b-472c-a75d-e0a2531325d7","block_type":"box","text":"transactions involve the purchase or sale of securities by a Fund at an established price with payment and delivery","page_number":110,"box":{"x":68,"y":732,"width":820,"height":12}},{"id":"136a1484-0d85-4945-9bae-33b2748867ec","block_type":"box","text":"taking place in the future. The Fund enters into these transactions to obtain what is considered an advantageous","page_number":110,"box":{"x":68,"y":748,"width":807,"height":11}},{"id":"23e96e0d-c4cf-4037-a012-00104560299a","block_type":"box","text":"price to the Fund at the time of entering into the transaction.","page_number":110,"box":{"x":70,"y":763,"width":430,"height":11}},{"id":"2297a271-468d-4749-9d37-11af5f6df999","block_type":"box","text":"Pursuant to recommendations of the Treasury Market Practices Group, which is sponsored by the Federal","page_number":110,"box":{"x":102,"y":785,"width":750,"height":12}},{"id":"72c06a88-9d8d-4c81-be26-02cd465815f4","block_type":"box","text":"Reserve Bank of New York, a Fund or its counterpar ty generally will be required to post collateral when entering into","page_number":110,"box":{"x":70,"y":801,"width":823,"height":11}},{"id":"94d86109-8cd8-4f99-b0a9-a0dcab82cc11","block_type":"box","text":"cer tain forward-settling transactions, including without limitation TBA transactions. FINRA rules have also been","page_number":110,"box":{"x":69,"y":816,"width":788,"height":11}},{"id":"60f573e9-865e-4916-84f4-130f7d8ae2f5","block_type":"box","text":"implemented that include mandatory margin requirements for the TBA market with limited exceptions. The","page_number":110,"box":{"x":70,"y":831,"width":755,"height":11}},{"id":"31d01449-51e2-4adb-900b-a3a879439265","block_type":"box","text":"collateralization of TBA trades is intended to mitigate counterpar ty credit risk between trade and settlement, but","page_number":110,"box":{"x":69,"y":846,"width":799,"height":11}},{"id":"3b24fbf2-7a07-425b-a6fe-85ad602c5602","block_type":"box","text":"could increase the cost of TBA transactions and impose added operational complexity.","page_number":110,"box":{"x":69,"y":861,"width":614,"height":11}},{"id":"1a985882-1719-4e1d-a52b-2abecf0f89ea","block_type":"box","text":"There can be no assurance that a security purchased on a when-issued basis will be issued or that a security","page_number":110,"box":{"x":101,"y":884,"width":780,"height":11}},{"id":"ac114ba4-4903-478c-bfc5-188ef99cd417","block_type":"box","text":"purchased or sold on a delayed delivery basis or through a forward commitment will be delivered. Also, the value of","page_number":110,"box":{"x":70,"y":899,"width":823,"height":11}},{"id":"e2064a6a-d94e-4083-908d-8a247a07f2c1","block_type":"box","text":"II-79","page_number":110,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"4348508f-fc9e-4d1a-9631-223c21d2416c","block_type":"box","text":"NM1026U-5982568-110/232","page_number":110,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"7435099a-3368-4140-9821-d8b67a69a190","block_type":"box","text":"securities in these transactions on the delivery date may be more or less than the price paid by the Fund to purchase","page_number":111,"box":{"x":69,"y":45,"width":838,"height":11}},{"id":"eb5e9d9d-3dc4-4324-8dad-8094d0211487","block_type":"box","text":"the securities. The Fund will lose money if the value of the security in such a transaction declines below the purchase","page_number":111,"box":{"x":68,"y":60,"width":839,"height":11}},{"id":"463fd26c-d089-441f-9341-c17a07b7ecad","block_type":"box","text":"price and will not benefit if the value of the security appreciates above the sale price during the commitment period.","page_number":111,"box":{"x":70,"y":75,"width":824,"height":11}},{"id":"02992253-982b-4f97-b5d1-af8d04ec8770","block_type":"box","text":"If deemed advisable as a matter of investment strategy, a Fund may dispose of or renegotiate a commitment","page_number":111,"box":{"x":102,"y":98,"width":776,"height":11}},{"id":"97a54e90-88b2-40ed-a673-1160c1d0ae4d","block_type":"box","text":"after it has been entered into, and may sell securities it has committed to purchase before those securities are","page_number":111,"box":{"x":69,"y":113,"width":795,"height":11}},{"id":"bf272b7d-cd3a-4990-99e2-88189374388b","block_type":"box","text":"delivered to the Fund on the settlement date. In these cases the Fund may realize a taxable capital gain or loss.","page_number":111,"box":{"x":69,"y":128,"width":799,"height":11}},{"id":"3d43fd2f-482d-434c-b313-3b766bdae8de","block_type":"box","text":"When a Fund engages in when-issued, TBA or forward commitment transactions, it relies on the other par ty to","page_number":111,"box":{"x":101,"y":150,"width":784,"height":12}},{"id":"2a6e5676-37c0-46e2-a0fc-e56bc34e96b4","block_type":"box","text":"consummate the trade. Failure of such par ty to do so may result in the Fund’s incurring a loss or missing an","page_number":111,"box":{"x":69,"y":166,"width":772,"height":11}},{"id":"47ba456d-be51-4029-8168-af49ff11e13e","block_type":"box","text":"oppor tunity to obtain a price considered to be advantageous.","page_number":111,"box":{"x":69,"y":181,"width":434,"height":11}},{"id":"e4f1cf5e-b264-4798-a0cd-daf9353436d9","block_type":"box","text":"The market value of the securities underlying a commitment to purchase securities, and any subsequent","page_number":111,"box":{"x":101,"y":203,"width":745,"height":12}},{"id":"326e89c8-086a-4d16-9f44-59b6b2510026","block_type":"box","text":"fluctuations in their market value, is taken into account when determining the market value of a Fund star ting on the","page_number":111,"box":{"x":68,"y":218,"width":831,"height":12}},{"id":"c236a87b-93df-4acb-9bca-6ee0fc842338","block_type":"box","text":"day the Fund agrees to purchase the securities. The Fund does not earn interest on the securities it has committed","page_number":111,"box":{"x":69,"y":234,"width":823,"height":11}},{"id":"5a8d78cc-4ae9-468e-af90-16db34725975","block_type":"box","text":"to purchase until they are paid for and delivered on the settlement date.","page_number":111,"box":{"x":68,"y":249,"width":514,"height":11}},{"id":"e6e8bc69-af7b-451d-913f-5dd82781a647","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into when-issued or forward-settling","page_number":111,"box":{"x":102,"y":271,"width":759,"height":12}},{"id":"25a45341-42a2-4311-931a-f6eb9063480e","block_type":"box","text":"securities (","page_number":111,"box":{"x":69,"y":287,"width":78,"height":11}},{"id":"033b51cd-5dd3-4e27-b330-95af1eb9d622","block_type":"box","text":"e.g.","page_number":111,"box":{"x":148,"y":288,"width":25,"height":10}},{"id":"d990faf7-5f69-415a-b4e9-5bee5bfadab9","block_type":"box","text":", firm and standby commitments, including TBA commitments, and dollar rolls) and non-standard","page_number":111,"box":{"x":176,"y":286,"width":686,"height":12}},{"id":"04d0327f-1c1b-4f72-b7f1-5bb7106d65ad","block_type":"box","text":"settlement cycle securities notwithstanding the limitation on the issuance of senior securities in Section 18 of the","page_number":111,"box":{"x":69,"y":302,"width":813,"height":11}},{"id":"2400df8b-aebb-4a4b-97f6-9659ca194498","block_type":"box","text":"Investment Company Act, provided that the Fund intends to physically settle the transaction and the transaction will","page_number":111,"box":{"x":70,"y":317,"width":822,"height":11}},{"id":"b48efd8d-4cd3-42f6-83d6-6991e0a9fbaa","block_type":"box","text":"settle within 35 days of its trade date (the “Delayed-Settlement Securities Provision”). If a when-issued, forward","page_number":111,"box":{"x":69,"y":332,"width":802,"height":11}},{"id":"3aef7a3f-5c3c-4077-bc4b-450263c6dd8e","block_type":"box","text":"settling or non-standard settlement cycle security does not satisfy the Delayed-Settlement Securities Provision, then","page_number":111,"box":{"x":69,"y":347,"width":826,"height":11}},{"id":"b45cba31-6b04-413a-8ed7-a74393b076e8","block_type":"box","text":"it is treated as a Derivatives Transaction under Rule 18f-4. See “—Derivatives — Regulation of Derivatives — Rule","page_number":111,"box":{"x":70,"y":362,"width":816,"height":11}},{"id":"43d1e18c-3457-4d7c-91c0-6ca97edd83dc","block_type":"box","text":"18f-4 under the Investment Company Act” above.","page_number":111,"box":{"x":70,"y":377,"width":349,"height":11}},{"id":"889a3a3b-a95d-4a3d-b1db-b2d0eb46ba3b","block_type":"box","text":"Regulations adopted by global prudential regulators require cer tain bank-regulated counterpar ties and cer tain of","page_number":111,"box":{"x":102,"y":400,"width":800,"height":11}},{"id":"31235765-6cc4-4bdf-9fb4-52776510da95","block_type":"box","text":"their affiliates to include in cer tain financial contracts, including many agreements with respect to when-issued, TBA","page_number":111,"box":{"x":68,"y":415,"width":829,"height":11}},{"id":"750a6217-1bf1-4733-9399-2734537c4d02","block_type":"box","text":"and forward commitment transactions, terms that delay or restrict the rights of counterpar ties, such as a Fund, to","page_number":111,"box":{"x":69,"y":430,"width":814,"height":11}},{"id":"9474215d-ecab-4112-b87a-52e20fb56319","block_type":"box","text":"terminate such agreements, foreclose upon collateral, exercise other default rights or restrict transfers of credit","page_number":111,"box":{"x":68,"y":445,"width":799,"height":12}},{"id":"26f0397f-4ed6-4912-9d8c-2ccfb31e2e8a","block_type":"box","text":"suppor t in the event that the counterpar ty and/or its affiliates are subject to cer tain types of resolution or insolvency","page_number":111,"box":{"x":69,"y":460,"width":836,"height":12}},{"id":"c223db3a-6d79-4b40-bb6f-eb4291bf83bc","block_type":"box","text":"proceedings. It is possible that these requirements, as well as potential additional government regulation and other","page_number":111,"box":{"x":70,"y":476,"width":824,"height":11}},{"id":"2d6bc2ac-cc46-4d1e-a09d-b06aec4f7dbc","block_type":"box","text":"developments in the market, could adversely affect a Fund’s ability to terminate existing agreements with respect to","page_number":111,"box":{"x":69,"y":491,"width":829,"height":11}},{"id":"4c3c96ff-0c4c-44bc-822f-3cacc3c899d7","block_type":"box","text":"these transactions or to realize amounts to be received under such agreements.","page_number":111,"box":{"x":68,"y":506,"width":573,"height":11}},{"id":"db8c4016-77cc-4688-8187-a5a8bd2baf7c","block_type":"box","text":"Yields and Ratings.","page_number":111,"box":{"x":103,"y":529,"width":139,"height":11}},{"id":"4d53a7de-9463-4a9c-a35c-c36f6191137e","block_type":"box","text":"The yields on cer tain obligations are dependent on a variety of factors, including general","page_number":111,"box":{"x":247,"y":528,"width":628,"height":12}},{"id":"678085de-7262-4f96-9dad-30c426e8e4fe","block_type":"box","text":"market conditions, conditions in the par ticular market for the obligation, the financial condition of the issuer, the size","page_number":111,"box":{"x":69,"y":543,"width":834,"height":12}},{"id":"3d3eebff-14a1-4974-9dcc-c08fb486263d","block_type":"box","text":"of the offering, the maturity of the obligation and the ratings of the issue. The ratings of Moody’s, Fitch and S&P","page_number":111,"box":{"x":69,"y":559,"width":799,"height":11}},{"id":"7a1c1c06-9f62-4f2c-8eb0-44d876c46d81","block_type":"box","text":"represent their respective opinions as to the quality of the obligations they under take to rate. Ratings, however, are","page_number":111,"box":{"x":69,"y":574,"width":824,"height":11}},{"id":"4746d70d-2078-405d-ac1c-3967d0aa8fa2","block_type":"box","text":"general and are not absolute standards of quality. Consequently, obligations with the same rating, maturity and","page_number":111,"box":{"x":68,"y":589,"width":792,"height":11}},{"id":"e648363f-ea07-4c25-aea6-e97a794c803f","block_type":"box","text":"interest rate may have different market prices. Subsequent to its purchase by a Fund, a rated security may cease to","page_number":111,"box":{"x":70,"y":604,"width":827,"height":11}},{"id":"0256dbfd-5f0a-44d7-bf11-bb0e03e797b7","block_type":"box","text":"be rated. A Fund’s Manager or sub-adviser will consider such an event in determining whether the Fund should","page_number":111,"box":{"x":69,"y":619,"width":786,"height":11}},{"id":"bf66b438-c183-4e0c-b7e1-f3a6951c32aa","block_type":"box","text":"continue to hold the security.","page_number":111,"box":{"x":69,"y":634,"width":204,"height":11}},{"id":"c3d4dfdd-d211-43e2-8ac4-4714a7cc703c","block_type":"box","text":"Zero Coupon Securities.","page_number":111,"box":{"x":102,"y":657,"width":175,"height":11}},{"id":"26a53410-61b8-4a00-b6f4-7a76b04570e4","block_type":"box","text":"Zero coupon securities are securities that are sold at a discount to par value and do","page_number":111,"box":{"x":283,"y":657,"width":601,"height":11}},{"id":"10200d2d-2a8a-4b24-aac1-ecf5dacb3fe2","block_type":"box","text":"not pay interest during the life of the security. The discount approximates the total amount of interest the security will","page_number":111,"box":{"x":69,"y":672,"width":837,"height":11}},{"id":"d876c7c8-123a-4fe5-b8d4-954196247fff","block_type":"box","text":"accrue and compound over the period until maturity at a rate of interest reflecting the market rate of the security at","page_number":111,"box":{"x":69,"y":687,"width":822,"height":11}},{"id":"aacd2433-3aba-4d27-97dd-6e8ccb16019e","block_type":"box","text":"the time of issuance. Upon maturity, the holder of a zero coupon security is entitled to receive the par value of the","page_number":111,"box":{"x":68,"y":702,"width":814,"height":11}},{"id":"68dbbcd6-fb40-4ef4-846b-8a50e87fd3aa","block_type":"box","text":"security.","page_number":111,"box":{"x":69,"y":718,"width":57,"height":11}},{"id":"64df1a71-2d54-426d-8ec7-53704a026d5c","block_type":"box","text":"While interest payments are not made on such securities, holders of such securities are deemed to have","page_number":111,"box":{"x":101,"y":740,"width":749,"height":11}},{"id":"1850ec46-6581-4ad4-a5b8-de37623ffc7f","block_type":"box","text":"received income (“phantom income”) annually, notwithstanding that cash may not be received currently. The effect of","page_number":111,"box":{"x":69,"y":755,"width":835,"height":11}},{"id":"ee5922d9-26b5-44cd-9eec-dfa235803f20","block_type":"box","text":"owning instruments that do not make current interest payments is that a fixed yield is earned not only on the original","page_number":111,"box":{"x":69,"y":770,"width":833,"height":12}},{"id":"8dedada7-57eb-4805-b171-515061b5b58d","block_type":"box","text":"investment but also, in effect, on all discount accretion during the life of the obligations. This implicit reinvestment of","page_number":111,"box":{"x":70,"y":785,"width":836,"height":12}},{"id":"959c1137-e21f-4cf9-886b-ca9c896b5a83","block_type":"box","text":"earnings at a fixed rate eliminates the risk of being unable to invest distributions at a rate as high as the implicit","page_number":111,"box":{"x":69,"y":801,"width":804,"height":11}},{"id":"9a758d43-2a44-4025-b9db-6b71e7e1114a","block_type":"box","text":"yield on the zero coupon bond, but at the same time eliminates the holder’s ability to reinvest at higher rates in the","page_number":111,"box":{"x":68,"y":816,"width":824,"height":11}},{"id":"c7705e7c-65b4-4483-a8fa-f379468bbf6b","block_type":"box","text":"future. For this reason, some of these securities may be subject to substantially greater price fluctuations during","page_number":111,"box":{"x":68,"y":831,"width":805,"height":11}},{"id":"8fdd0e87-b744-4c76-9e71-a85e17e3aff6","block_type":"box","text":"periods of changing market interest rates than are comparable securities that pay interest currently. Longer term zero","page_number":111,"box":{"x":70,"y":846,"width":837,"height":11}},{"id":"128935aa-9fbb-47ab-8a90-b7e9b51b5d5e","block_type":"box","text":"coupon bonds are more exposed to interest rate risk than shor ter term zero coupon bonds. These investments","page_number":111,"box":{"x":69,"y":861,"width":791,"height":11}},{"id":"7e41a524-b7b8-4c20-94fe-70f71d9998ab","block_type":"box","text":"benefit the issuer by mitigating its need for cash to meet debt service, but also require a higher rate of return to","page_number":111,"box":{"x":69,"y":876,"width":800,"height":11}},{"id":"7ca2776d-7072-455f-8395-41c136b43132","block_type":"box","text":"attract investors who are willing to defer receipt of cash.","page_number":111,"box":{"x":69,"y":891,"width":400,"height":12}},{"id":"5234cf27-97b2-48d4-a7e2-5969cfe84645","block_type":"box","text":"II-80","page_number":111,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"bd511009-e731-4cb8-ba30-1b980b37c17b","block_type":"box","text":"NM1026U-5982568-111/232","page_number":111,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"6e5d3c23-339c-4385-840c-00eebd3bc18d","block_type":"box","text":"A Fund accrues income with respect to these securities for U.S. federal income tax and accounting purposes","page_number":112,"box":{"x":101,"y":45,"width":775,"height":11}},{"id":"30e39b52-68ac-4a65-9721-2c1dbf8852b5","block_type":"box","text":"prior to the receipt of cash payments. Zero coupon securities may be subject to greater fluctuation in value and less","page_number":112,"box":{"x":70,"y":60,"width":827,"height":11}},{"id":"df191259-227c-4b59-be84-7117ea15b63f","block_type":"box","text":"liquidity in the event of adverse market conditions than comparably rated securities that pay cash interest at regular","page_number":112,"box":{"x":70,"y":75,"width":826,"height":11}},{"id":"201936bb-7fa2-4f4a-b8c8-8db5249dec07","block_type":"box","text":"intervals.","page_number":112,"box":{"x":70,"y":90,"width":64,"height":9}},{"id":"973b396a-f7cf-4e2c-8bb4-2b1d70986d96","block_type":"box","text":"Fur ther, to maintain its qualification for pass-through treatment under the U.S. federal tax laws, a Fund is","page_number":112,"box":{"x":102,"y":113,"width":749,"height":11}},{"id":"ae392f6c-a48f-4d2e-9612-e87b39f03393","block_type":"box","text":"required to distribute income to its shareholders and, consequently, may have to dispose of other, more liquid","page_number":112,"box":{"x":69,"y":128,"width":784,"height":11}},{"id":"9a972262-4f89-4979-8be4-bf4fd414f352","block_type":"box","text":"por tfolio securities under disadvantageous circumstances or may have to leverage itself by borrowing in order to","page_number":112,"box":{"x":70,"y":143,"width":799,"height":11}},{"id":"6fafa6e7-7376-459e-b4f9-763985713391","block_type":"box","text":"generate the cash to satisfy these distributions. The required distributions may result in an increase in a Fund’s","page_number":112,"box":{"x":68,"y":158,"width":799,"height":11}},{"id":"0b16e864-7665-4177-b205-e8388713aeb4","block_type":"box","text":"exposure to zero coupon securities.","page_number":112,"box":{"x":69,"y":173,"width":253,"height":11}},{"id":"407d225d-f403-4451-a177-ba85ad873c99","block_type":"box","text":"In addition to the above-described risks, there are cer tain other risks related to investing in zero coupon","page_number":112,"box":{"x":102,"y":196,"width":740,"height":11}},{"id":"a0afad5b-a13e-46f9-bd02-1d6bec226294","block_type":"box","text":"securities. During a period of severe market conditions, the market for such securities may become even less liquid.","page_number":112,"box":{"x":69,"y":211,"width":829,"height":11}},{"id":"676c98fd-ccdc-4efe-b106-bbc3cb03420c","block_type":"box","text":"In addition, as these securities do not pay cash interest, a Fund’s investment exposure to these securities and their","page_number":112,"box":{"x":70,"y":226,"width":829,"height":11}},{"id":"fa347896-4506-45ea-a970-1e3e16a1e790","block_type":"box","text":"risks, including credit risk, will increase during the time these securities are held in the Fund’s por tfolio.","page_number":112,"box":{"x":69,"y":241,"width":741,"height":11}},{"id":"113aed02-a646-4c7a-8b4a-a5ab34042160","block_type":"box","text":"Suitability. (All Funds)","page_number":112,"box":{"x":101,"y":264,"width":161,"height":11}},{"id":"24232f90-0e31-40c2-a4b6-9ff918091b5b","block_type":"box","text":"The economic benefit of an investment in any Fund depends upon many factors beyond the control of the Fund,","page_number":112,"box":{"x":101,"y":286,"width":793,"height":12}},{"id":"1536e047-7499-4531-8a3e-86bfe1f51c1d","block_type":"box","text":"the Manager and its affiliates. Each Fund should be considered a vehicle for diversification and not as a balanced","page_number":112,"box":{"x":68,"y":302,"width":811,"height":11}},{"id":"8cc8788a-19dc-4941-b8e3-662c4c885006","block_type":"box","text":"investment program. The suitability for any par ticular investor of a purchase of shares in a Fund will depend upon,","page_number":112,"box":{"x":70,"y":317,"width":810,"height":11}},{"id":"0f2638e4-dc88-449e-aebb-da69d950722d","block_type":"box","text":"among other things, such investor’s investment objectives and such investor’s ability to accept the risks associated","page_number":112,"box":{"x":69,"y":332,"width":826,"height":11}},{"id":"0bdd6743-b765-4e4c-81a3-e9095b0caf81","block_type":"box","text":"with investing in securities, including the risk of loss of principal.","page_number":112,"box":{"x":68,"y":347,"width":460,"height":11}},{"id":"89819f6c-4eca-4f7b-830e-7605d1c5097d","block_type":"box","text":"Investment Restrictions. (All Funds)","page_number":112,"box":{"x":102,"y":370,"width":264,"height":11}},{"id":"9a462401-0bb1-4fab-8935-8e1daadd286a","block_type":"box","text":"See “Investment Restrictions” or “Investment Policies,” as applicable in each Fund’s SAI for the specific","page_number":112,"box":{"x":102,"y":392,"width":745,"height":11}},{"id":"c769e995-ac95-4683-933e-d600b361b626","block_type":"box","text":"fundamental and non-fundamental investment restrictions adopted by each Fund. In addition to those investment","page_number":112,"box":{"x":68,"y":407,"width":807,"height":12}},{"id":"e5f22d42-75dd-4160-8e84-e6428f1160fb","block_type":"box","text":"restrictions, each Fund is also subject to the restrictions discussed below.","page_number":112,"box":{"x":69,"y":423,"width":528,"height":11}},{"id":"5214896f-89c1-41ab-a757-c1430dac4166","block_type":"box","text":"Each Fund’s investments will be limited in order to allow the Fund to qualify as a “regulated investment","page_number":112,"box":{"x":102,"y":445,"width":735,"height":12}},{"id":"09d2449e-46a5-4131-9d91-ff1404084152","block_type":"box","text":"company” for purposes of the Code. See “Dividends and Taxes — Taxes” or “Taxes.” To qualify, among other","page_number":112,"box":{"x":69,"y":460,"width":775,"height":12}},{"id":"c1e5e1a2-e88f-4234-af52-2aaff3452e44","block_type":"box","text":"requirements, each Fund will limit its investments so that, at the close of each quar ter of the taxable year, (i) at least","page_number":112,"box":{"x":69,"y":475,"width":837,"height":12}},{"id":"d18c3e59-962a-4f02-bad1-0ec2a790aae5","block_type":"box","text":"50% of the market value of each Fund’s assets is represented by cash, securities of other regulated investment","page_number":112,"box":{"x":69,"y":491,"width":799,"height":11}},{"id":"0e264731-38c9-406e-b17e-afdd65e74d81","block_type":"box","text":"companies, U.S. Government Securities and other securities, with such other securities limited, in respect of any one","page_number":112,"box":{"x":69,"y":506,"width":837,"height":11}},{"id":"08dfb009-150c-477b-8b35-97984d70da16","block_type":"box","text":"issuer, to an amount not greater in value than 5% of the Fund’s assets and not greater than 10% of the outstanding","page_number":112,"box":{"x":70,"y":521,"width":825,"height":11}},{"id":"ad47dc1a-15c5-4377-8e3f-a3a25e72f4e4","block_type":"box","text":"voting securities of such issuer and (ii) not more than 25% of the value of its assets is invested in the securities","page_number":112,"box":{"x":68,"y":536,"width":802,"height":11}},{"id":"da0c263a-9345-4583-afc4-9eae0a6ea838","block_type":"box","text":"(other than U.S. Government Securities or securities of other regulated investment companies) of any one issuer, any","page_number":112,"box":{"x":69,"y":551,"width":837,"height":11}},{"id":"d66770aa-5e13-4427-8197-1e50873c50f6","block_type":"box","text":"two or more issuers that the Fund controls and that are determined to be engaged in the same or similar trades or","page_number":112,"box":{"x":68,"y":566,"width":819,"height":11}},{"id":"658cf881-875e-4440-ae93-856bf48e4f33","block_type":"box","text":"businesses or related trades or businesses or in the securities of one or more qualified publicly traded par tnerships","page_number":112,"box":{"x":69,"y":581,"width":828,"height":11}},{"id":"df872303-2293-4d0c-acdf-719bdd92a60e","block_type":"box","text":"(","page_number":112,"box":{"x":69,"y":597,"width":3,"height":10}},{"id":"b513b5de-a166-4001-a4f2-cedd2bcdea23","block_type":"box","text":"i.e.","page_number":112,"box":{"x":74,"y":597,"width":21,"height":8}},{"id":"0fc0c36a-9ba7-4fd7-ba46-c7d4a6d1eaa8","block_type":"box","text":", par tnerships that are traded on an established securities market or tradable on a secondary market, other than","page_number":112,"box":{"x":97,"y":597,"width":806,"height":11}},{"id":"95d6e57c-1ac4-4802-b6b2-6f1c5ed1d5b4","block_type":"box","text":"par tnerships that derive 90% of their income from interest, dividends, capital gains and other traditionally permitted","page_number":112,"box":{"x":70,"y":612,"width":824,"height":11}},{"id":"80c3512b-fa63-441d-be2d-062a70c7036d","block_type":"box","text":"mutual fund income). For purposes of this restriction, the Municipal Funds generally will regard each state and each","page_number":112,"box":{"x":69,"y":627,"width":824,"height":11}},{"id":"0fcc77ae-3765-4386-85a4-cc11b0e4e38a","block_type":"box","text":"of its political subdivisions, agencies or instrumentalities and each multi-state agency of which the state is a member","page_number":112,"box":{"x":69,"y":642,"width":838,"height":11}},{"id":"84bbfcaa-c68b-4bcb-a137-38b2f6e86b29","block_type":"box","text":"as a separate issuer. Each public authority that issues securities on behalf of a private entity generally will also be","page_number":112,"box":{"x":69,"y":657,"width":815,"height":11}},{"id":"b63cd02a-8007-459b-b465-51cd91efe75c","block_type":"box","text":"regarded as a separate issuer, except that if the security is backed only by the assets and revenues of a non","page_number":112,"box":{"x":69,"y":672,"width":781,"height":11}},{"id":"898338ee-bbcd-4c7d-8f42-95bcdd432b70","block_type":"box","text":"government entity, then the entity with the ultimate responsibility for the payment of interest and principal may be","page_number":112,"box":{"x":68,"y":687,"width":810,"height":11}},{"id":"03afd5f3-732e-4ee5-a86d-c567ce4b88d2","block_type":"box","text":"regarded as the sole issuer.","page_number":112,"box":{"x":69,"y":703,"width":198,"height":11}},{"id":"f26fab63-c3da-4c2d-a580-68bef30330b4","block_type":"box","text":"Foreign government securities (unlike U.S. Government Securities) are not exempt from the 5%, 10% and 25%","page_number":112,"box":{"x":102,"y":725,"width":784,"height":11}},{"id":"20df8316-fbf8-40e4-8c2e-7a64afa5a74f","block_type":"box","text":"diversification requirements of the Code discussed above and the securities of each foreign government issuer are","page_number":112,"box":{"x":69,"y":740,"width":819,"height":11}},{"id":"51cf887f-c099-4872-9344-628baf6ffca7","block_type":"box","text":"considered to be obligations of a single issuer. These tax-related limitations may be changed by the Directors of a","page_number":112,"box":{"x":69,"y":755,"width":811,"height":11}},{"id":"11142b58-1936-4756-90b8-c9eb376a1e89","block_type":"box","text":"Fund to the extent necessary to comply with changes to the U.S. federal tax requirements. 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The Manager","page_number":113,"box":{"x":68,"y":242,"width":832,"height":11}},{"id":"04579934-517e-42a3-86b0-7b5a0c02b46e","block_type":"box","text":"per forms cer tain of the other administrative services and provides all the office space, facilities, equipment and","page_number":113,"box":{"x":70,"y":257,"width":801,"height":11}},{"id":"328447d8-f25a-42f6-8f01-f622a228f205","block_type":"box","text":"necessary personnel for management of each Fund.","page_number":113,"box":{"x":69,"y":272,"width":370,"height":11}},{"id":"0af4bc41-b44e-4967-ac90-e1d7e75e1c80","block_type":"box","text":"Each Feeder Fund invests all or a por tion of its assets in shares of a Master Por tfolio. 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For such Feeder Funds, por tfolio management occurs at the Master Por tfolio level.","page_number":113,"box":{"x":69,"y":325,"width":810,"height":11}},{"id":"313f3c05-fbd9-4977-aef2-b7002f316cab","block_type":"box","text":"Management Fee.","page_number":113,"box":{"x":102,"y":348,"width":126,"height":11}},{"id":"53049c44-cf6c-4d60-af91-10e15a5e0641","block_type":"box","text":"Each Fund has entered into a Management Agreement with the Manager pursuant to which","page_number":113,"box":{"x":235,"y":348,"width":646,"height":11}},{"id":"58b9ac6e-1d89-4a11-943b-8f3bad67106a","block_type":"box","text":"the Manager receives for its services to the Fund monthly compensation at an annual rate based on the average daily","page_number":113,"box":{"x":68,"y":363,"width":841,"height":11}},{"id":"05cf72e8-3e57-4471-b5e0-b665238c2eb1","block_type":"box","text":"net assets of the Fund. For information regarding the fees paid by your Fund to the Manager for the Fund’s last three","page_number":113,"box":{"x":69,"y":378,"width":833,"height":11}},{"id":"c2067821-9710-49f2-b971-365c3ef52ce1","block_type":"box","text":"fiscal years or other applicable periods, see “Management, Advisory and Other Service Arrangements —","page_number":113,"box":{"x":68,"y":393,"width":746,"height":11}},{"id":"2da6641f-89e9-488a-9036-3c041d72e3e4","block_type":"box","text":"Management Agreement” or “Management and Advisory Arrangements,” as applicable, in Par t I of each Fund’s SAI.","page_number":113,"box":{"x":70,"y":408,"width":825,"height":11}},{"id":"b5f2b08f-a3fc-46fa-a4cf-cf74d9c38923","block_type":"box","text":"For Funds that do not have an administrator, each Management Agreement obligates the Manager to provide","page_number":113,"box":{"x":102,"y":431,"width":774,"height":11}},{"id":"3c2cdba9-1f4c-4dd9-8b09-70d34abb8e8e","block_type":"box","text":"management services and to pay all compensation of and furnish office space for officers and employees of a Fund","page_number":113,"box":{"x":69,"y":446,"width":826,"height":11}},{"id":"5169efaa-60cd-4207-9577-110d68bf4c06","block_type":"box","text":"in connection with investment and economic research, trading and investment management of the Fund, as well as","page_number":113,"box":{"x":70,"y":461,"width":820,"height":11}},{"id":"ef7eed36-3176-4f39-9bf9-d98df31c6b8f","block_type":"box","text":"the fees of all Directors of the Fund who are interested persons of the Fund. Each Fund pays all other expenses","page_number":113,"box":{"x":68,"y":476,"width":797,"height":11}},{"id":"10c4d233-cbd1-411a-8eb0-d5695a248dec","block_type":"box","text":"incurred in the operation of that Fund, including among other things: taxes; expenses for legal and auditing services;","page_number":113,"box":{"x":70,"y":491,"width":830,"height":12}},{"id":"a5a93b82-6288-476e-8e5b-93a3c82db3f7","block_type":"box","text":"costs of preparing, printing and mailing proxies, shareholder repor ts, prospectuses and statements of additional","page_number":113,"box":{"x":69,"y":506,"width":802,"height":12}},{"id":"1fd28c6b-eaaf-4bd8-823b-f170c877c0c3","block_type":"box","text":"information, except to the extent paid by BlackRock Investments, LLC (“BRIL” or the “Distributor”); charges of the","page_number":113,"box":{"x":70,"y":521,"width":809,"height":12}},{"id":"5d08c7a1-a878-4523-a604-20171bc873a2","block_type":"box","text":"custodian and sub-custodian, and the transfer agent; expenses of redemption of shares; Commission fees; expenses","page_number":113,"box":{"x":69,"y":537,"width":838,"height":11}},{"id":"e0904a70-6a24-4d22-a19d-476e0f3554f1","block_type":"box","text":"of registering the shares under Federal, state or foreign laws; fees and expenses of Directors who are not interested","page_number":113,"box":{"x":69,"y":552,"width":830,"height":11}},{"id":"d7492c30-3227-4995-83a9-0506e4f93f40","block_type":"box","text":"persons of a Fund as defined in the Investment Company Act; accounting and pricing costs (including the daily","page_number":113,"box":{"x":70,"y":567,"width":784,"height":11}},{"id":"a89c056c-be3b-4054-87bb-53218ac8556b","block_type":"box","text":"calculations of NAV); insurance; interest; brokerage costs; litigation and other extraordinary or non-recurring","page_number":113,"box":{"x":69,"y":582,"width":767,"height":11}},{"id":"4e845cad-9d05-4d8c-86c7-f1d50c2ecea1","block_type":"box","text":"expenses; and other expenses properly payable by the Fund. Cer tain accounting services are provided to each Fund","page_number":113,"box":{"x":69,"y":597,"width":825,"height":11}},{"id":"cd5c3d3f-baf9-4240-927e-6c85fa93d7ca","block_type":"box","text":"by State Street Bank and Trust Company (“State Street”), The Bank of New York Mellon (“BNY Mellon”) or JPMorgan","page_number":113,"box":{"x":69,"y":612,"width":827,"height":11}},{"id":"8518a844-d924-4868-861f-60f2f6b72f14","block_type":"box","text":"Chase Bank, N.A. (“JPM”) pursuant to an agreement between State Street, BNY Mellon or JPM, as applicable, and","page_number":113,"box":{"x":69,"y":627,"width":814,"height":12}},{"id":"30b82c5d-c3bd-41ae-94bb-67afb485c97c","block_type":"box","text":"each Fund. Each Fund pays a fee for these services. The Distributor pays cer tain promotional expenses of the Funds","page_number":113,"box":{"x":69,"y":642,"width":832,"height":12}},{"id":"69adfeb0-144f-401f-972e-6bb0e02dc1ed","block_type":"box","text":"incurred in connection with the offering of shares of the Funds. Cer tain expenses are financed by each Fund pursuant","page_number":113,"box":{"x":70,"y":658,"width":839,"height":11}},{"id":"3f94514a-a6b6-4df0-af9d-2f5c02ac52ac","block_type":"box","text":"to distribution plans in compliance with Rule 12b-1 under the Investment Company Act. See “Purchase of Shares —","page_number":113,"box":{"x":68,"y":673,"width":828,"height":11}},{"id":"c996a78d-e518-42f8-8fde-16d8dff658dd","block_type":"box","text":"Distribution and/or Shareholder Servicing Plans.”","page_number":113,"box":{"x":70,"y":688,"width":350,"height":11}},{"id":"0a2f9bca-5c36-4261-9a98-2cb9e118353a","block_type":"box","text":"Sub-Advisory Fee.","page_number":113,"box":{"x":102,"y":711,"width":124,"height":11}},{"id":"15726333-5520-450b-978f-a4759506dd7a","block_type":"box","text":"The Manager of cer tain Funds has entered into one or more sub-advisory agreements (the","page_number":113,"box":{"x":232,"y":710,"width":643,"height":12}},{"id":"8891e0d4-0468-497e-a649-b68c8bd578ab","block_type":"box","text":"“Sub-Advisory Agreements”) with the sub-adviser or sub-advisers identified in each such Fund’s Prospectus (the “Sub","page_number":113,"box":{"x":70,"y":726,"width":839,"height":11}},{"id":"155f6890-6ddb-4469-816e-a3e2366f9681","block_type":"box","text":"Adviser”) pursuant to which the Sub-Adviser provides sub-advisory services to the Manager with respect to the Fund.","page_number":113,"box":{"x":68,"y":741,"width":830,"height":11}},{"id":"f45420e4-1c31-4532-ab11-6950d1322e57","block_type":"box","text":"Organization of the Manager.","page_number":113,"box":{"x":102,"y":763,"width":204,"height":12}},{"id":"a14fc68e-ce83-4630-bac8-6e65dcf8c64b","block_type":"box","text":"BlackRock Advisors, LLC is a Delaware limited liability company and BlackRock","page_number":113,"box":{"x":313,"y":763,"width":560,"height":12}},{"id":"dd876e50-5387-4065-8f40-28d9b5ce7973","block_type":"box","text":"Fund Advisors is a California corporation. Each Manager is an indirect, majority-owned subsidiary of BlackRock, Inc.","page_number":113,"box":{"x":70,"y":778,"width":819,"height":12}},{"id":"aa80d2cf-069c-4a0d-93eb-754366b45240","block_type":"box","text":"BlackRock, Inc., through its subsidiaries and divisions, provides (i) investment management services to individuals","page_number":113,"box":{"x":70,"y":794,"width":817,"height":11}},{"id":"eec47ac3-5bc7-4c09-957d-5e56b131e7cc","block_type":"box","text":"and institutional investors through separate account management, non-discretionary advisory programs and","page_number":113,"box":{"x":69,"y":809,"width":768,"height":11}},{"id":"897836fd-7554-4c6d-9e18-7b23b645b356","block_type":"box","text":"commingled investment vehicles; (ii) risk management services, investment accounting and trade processing tools;","page_number":113,"box":{"x":69,"y":824,"width":821,"height":11}},{"id":"cba084da-0087-472f-b380-025623679993","block_type":"box","text":"(iii) transition management services, and (iv) securities lending services.","page_number":113,"box":{"x":69,"y":839,"width":517,"height":11}},{"id":"61043379-6b05-4d49-85a1-40bbcb3678fc","block_type":"box","text":"Duration and Termination.","page_number":113,"box":{"x":102,"y":862,"width":182,"height":9}},{"id":"d94066ca-6f14-441b-8d6b-51e3ee7bbdac","block_type":"box","text":"Unless earlier terminated as described below, each Management Agreement and each","page_number":113,"box":{"x":292,"y":862,"width":613,"height":11}},{"id":"51aa4c6e-eac4-4222-91bc-afedd586f1b5","block_type":"box","text":"Sub-Advisory Agreement will remain in effect for an initial two year period and from year to year thereafter if approved","page_number":113,"box":{"x":69,"y":877,"width":835,"height":11}},{"id":"a9aae98a-0d29-4d6b-9f2c-6120be361765","block_type":"box","text":"annually (a) by the Board of Directors or by a vote of a majority of the outstanding voting securities of a Fund and","page_number":113,"box":{"x":69,"y":892,"width":803,"height":11}},{"id":"47e2a9d8-4d33-4925-8188-6d9ab25ee750","block_type":"box","text":"(b) by a majority of the Directors of the Fund who are not par ties to such agreement or interested persons (as defined","page_number":113,"box":{"x":69,"y":907,"width":839,"height":11}},{"id":"b9b41219-3e23-4e3f-8745-b46b3d7f58f9","block_type":"box","text":"II-82","page_number":113,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"0af1a029-1ec2-4691-8585-40e8dfeff3a7","block_type":"box","text":"NM1026U-5982568-113/232","page_number":113,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"48683281-84d8-465b-8515-45cbdfd03cc0","block_type":"box","text":"in the Investment Company Act) of any such par ty. Each Management Agreement automatically terminates on","page_number":114,"box":{"x":70,"y":45,"width":778,"height":11}},{"id":"6088867b-8e4e-4ad3-97fa-2656c074dc57","block_type":"box","text":"assignment and may be terminated without penalty on 60 days’ written notice at the option of either par ty thereto or","page_number":114,"box":{"x":69,"y":60,"width":832,"height":11}},{"id":"fb0b02e5-5d71-4af2-9571-0ad33ab4faad","block_type":"box","text":"by the vote of the shareholders of the applicable Fund.","page_number":114,"box":{"x":69,"y":75,"width":388,"height":11}},{"id":"aa0aef3d-1b1e-46d4-8686-23d8c3df3d4b","block_type":"box","text":"Other Service Arrangements","page_number":114,"box":{"x":69,"y":105,"width":205,"height":11}},{"id":"e07f2eb3-b5ad-4b56-bc78-d922438b9ba9","block_type":"box","text":"Administrative Services and Administrative Fee.","page_number":114,"box":{"x":101,"y":128,"width":338,"height":9}},{"id":"a3655df3-0b43-4ed6-b072-612cbae6ebab","block_type":"box","text":"Cer tain Funds have entered into an administration agreement","page_number":114,"box":{"x":446,"y":128,"width":439,"height":11}},{"id":"14da19f6-f58f-4771-a12c-07886032f13f","block_type":"box","text":"(the “Administration Agreement”) with an administrator identified in the Fund’s Prospectus and Par t I of the Fund’s","page_number":114,"box":{"x":69,"y":143,"width":818,"height":11}},{"id":"cf334c2b-7d56-41b4-88ed-34d8122ca297","block_type":"box","text":"SAI (each an “Administrator”). For its services to a Fund, the Administrator receives monthly compensation at the","page_number":114,"box":{"x":69,"y":158,"width":808,"height":11}},{"id":"85ef8f41-b011-4b08-8e1d-8ed4cc499c90","block_type":"box","text":"annual rate set for th in each applicable Fund’s Prospectus. For information regarding any administrative fees paid by","page_number":114,"box":{"x":69,"y":173,"width":833,"height":11}},{"id":"9cf1516b-b3fd-4659-a035-136740d2c63c","block_type":"box","text":"your Fund to the Administrator for the periods indicated, see “Management, Advisory and Other Service","page_number":114,"box":{"x":68,"y":188,"width":738,"height":12}},{"id":"2d004350-57dc-4811-a5f6-6249f8e3f7ec","block_type":"box","text":"Arrangements — Administration Agreement” or “Management and Advisory Arrangements,” as applicable, in Par t I of","page_number":114,"box":{"x":68,"y":203,"width":839,"height":12}},{"id":"85141ec3-72ad-4514-8201-d699cc88c1e0","block_type":"box","text":"that Fund’s SAI.","page_number":114,"box":{"x":68,"y":219,"width":113,"height":8}},{"id":"5e6a5d45-1d85-496a-8dbc-90c676a9b85b","block_type":"box","text":"For Funds that have an Administrator, the Administration Agreement obligates the Administrator to provide","page_number":114,"box":{"x":102,"y":241,"width":755,"height":11}},{"id":"bc5f85c9-676b-4e0d-9508-830e3f7cddce","block_type":"box","text":"cer tain administrative services to the Fund and to pay, or cause its affiliates to pay, for maintaining its staff and","page_number":114,"box":{"x":69,"y":256,"width":800,"height":12}},{"id":"66122290-f487-456b-8af6-48fe12e2bc26","block_type":"box","text":"personnel and to provide office space, facilities and necessary personnel for the Fund. 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Please see the inside back cover page of your Fund’s Prospectus and Par t I","page_number":114,"box":{"x":69,"y":642,"width":823,"height":11}},{"id":"a172af8f-cfc0-4aba-a385-56f76923ab49","block_type":"box","text":"of this SAI for information on your Fund’s independent registered public accounting firm.","page_number":114,"box":{"x":69,"y":657,"width":627,"height":11}},{"id":"0aea8ddc-5193-42f3-b9ea-b4e768309a26","block_type":"box","text":"Custodian Services.","page_number":114,"box":{"x":102,"y":680,"width":141,"height":9}},{"id":"5792f5f6-2ab4-4a6c-a36f-c9b7095f26e5","block_type":"box","text":"The name and address of the custodian (the “Custodian”) of each Fund are provided on the","page_number":114,"box":{"x":249,"y":680,"width":654,"height":11}},{"id":"4a36e2a4-7fdb-49f7-be04-ccb6c20b34d3","block_type":"box","text":"inside back cover page of the Fund’s Prospectus. 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Employees subject to the Code of Ethics may invest in securities for their personal","page_number":115,"box":{"x":69,"y":370,"width":803,"height":11}},{"id":"0cc5ef1d-e389-4efc-9849-f1876cde75a6","block_type":"box","text":"investment accounts, including securities that may be purchased or held by a Fund.","page_number":115,"box":{"x":70,"y":385,"width":593,"height":11}},{"id":"74f7e626-823b-4fee-9a6a-ac735e9f6e24","block_type":"box","text":"SELECTIVE DISCLOSURE OF PORTFOLIO HOLDINGS","page_number":115,"box":{"x":282,"y":414,"width":413,"height":10}},{"id":"875670bf-4cf5-4b7e-aeeb-7b30a95d6b85","block_type":"box","text":"The Board of Directors of each Fund and the Board of Directors of the Manager have each approved Por tfolio","page_number":115,"box":{"x":101,"y":437,"width":777,"height":11}},{"id":"4c16aa7f-1c83-456d-860a-ad1ee9e1d3bf","block_type":"box","text":"Holdings and Related Information Distribution Guidelines (the “Policy”) regarding the disclosure of each Fund’s","page_number":115,"box":{"x":70,"y":452,"width":788,"height":11}},{"id":"da0a3ca1-2f13-41c8-b2fd-eb9e13368204","block_type":"box","text":"por tfolio securities, as applicable, and other por tfolio information. 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(collectively referred to in this section as “BlackRock”) and their respective directors,","page_number":120,"box":{"x":69,"y":286,"width":829,"height":12}},{"id":"1a88cf22-3fe7-4ca5-bdb4-0eabff2f4db5","block_type":"box","text":"officers or employees, with respect to the Funds and/or other accounts managed by BlackRock, may give rise to","page_number":120,"box":{"x":69,"y":302,"width":802,"height":11}},{"id":"72df74e8-9867-494a-9d1d-4b8e749ed0e3","block_type":"box","text":"actual or perceived conflicts of interest such as those described below.","page_number":120,"box":{"x":69,"y":317,"width":507,"height":11}},{"id":"51f018b5-ae43-4346-957b-c867ea1f4188","block_type":"box","text":"BlackRock is one of the world’s largest asset management firms. BlackRock, its subsidiaries and their","page_number":120,"box":{"x":102,"y":339,"width":731,"height":12}},{"id":"55fb38ee-27bb-4dcb-850b-8e48e16ee613","block_type":"box","text":"respective directors, officers and employees, including the business units or entities and personnel who may be","page_number":120,"box":{"x":69,"y":355,"width":799,"height":11}},{"id":"665686b4-1e9a-4c55-bc96-390d87c4b6e5","block_type":"box","text":"involved in the investment activities and business operations of a Fund, are engaged worldwide in businesses,","page_number":120,"box":{"x":70,"y":370,"width":786,"height":11}},{"id":"b87ecc9d-9b2a-4a8e-a152-67a6895df78c","block_type":"box","text":"including managing equities, fixed income securities, cash and alternative investments, and other financial services,","page_number":120,"box":{"x":70,"y":385,"width":829,"height":11}},{"id":"d09ca557-ec3a-4279-8a90-17d0646f5364","block_type":"box","text":"and have interests other than that of managing the Funds. 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Such other funds or accounts may offer exposure to strategies that are identical or","page_number":120,"box":{"x":69,"y":536,"width":808,"height":11}},{"id":"9276daa1-e960-4802-ae55-956e915075c5","block_type":"box","text":"substantially similar to those of a Fund but with different fees and expenses, governance and structures, and/or","page_number":120,"box":{"x":69,"y":551,"width":803,"height":11}},{"id":"2028d14c-f87f-4bd7-b858-8118caa4a68a","block_type":"box","text":"services provided by BlackRock","page_number":120,"box":{"x":69,"y":566,"width":224,"height":11}},{"id":"a4e7e647-73d0-4aa6-998d-7df05cf8547f","block_type":"box","text":".","page_number":120,"box":{"x":295,"y":574,"width":2,"height":1}},{"id":"c0928fcd-0f16-4606-9ca7-bab8ea2878d7","block_type":"box","text":"BlackRock is also a major par ticipant in the global currency, equities, swap and fixed","page_number":120,"box":{"x":304,"y":566,"width":603,"height":11}},{"id":"4e3b4f19-ebc5-43e2-94bb-b7df2e5598e5","block_type":"box","text":"income markets, in each case, for the accounts of clients and, in some cases, on a proprietary basis. As such,","page_number":120,"box":{"x":70,"y":581,"width":791,"height":11}},{"id":"2cbbc65b-2c37-4c42-a906-56d618d6c915","block_type":"box","text":"BlackRock is or may be actively engaged in transactions in the same securities, currencies, and instruments in which","page_number":120,"box":{"x":70,"y":597,"width":835,"height":11}},{"id":"7b8e5c04-5b14-4204-8bd0-db0a51a3b84b","block_type":"box","text":"a Fund invests.","page_number":120,"box":{"x":69,"y":612,"width":106,"height":9}},{"id":"3d6d1a5b-a1e7-447e-b8ca-55d5bef992a3","block_type":"box","text":"Such activities could affect the prices and availability of the securities, currencies, and instruments in which a","page_number":120,"box":{"x":102,"y":634,"width":785,"height":11}},{"id":"ad47a909-e3a9-4b33-acd2-62a48d973bc1","block_type":"box","text":"Fund invests, which could have an adverse impact on a Fund’s per formance. Such transactions, par ticularly in","page_number":120,"box":{"x":70,"y":649,"width":785,"height":12}},{"id":"85c277a3-8199-4d76-b1b9-7e3bd52d1127","block_type":"box","text":"respect of most proprietary accounts or client accounts, will be executed independently of a Fund’s transactions and","page_number":120,"box":{"x":69,"y":664,"width":832,"height":12}},{"id":"59fe4954-b8f7-4cd2-a08f-bc20443aff58","block_type":"box","text":"thus at prices or rates that may be more or less favorable than those obtained by the Fund.","page_number":120,"box":{"x":68,"y":680,"width":652,"height":11}},{"id":"080d93e2-2ab4-4ec4-9410-efb658378e86","block_type":"box","text":"In addition, the por tfolio holdings of cer tain BlackRock-advised investment vehicles managed in an identical or","page_number":120,"box":{"x":102,"y":702,"width":787,"height":12}},{"id":"bad6683e-c20f-4790-9e91-9fb408e8e5ab","block_type":"box","text":"substantially similar manner as cer tain Funds are made publicly available on a more timely basis than the applicable","page_number":120,"box":{"x":69,"y":718,"width":832,"height":11}},{"id":"eb795ac1-545b-4e7f-ab6b-a9f51914cdb9","block_type":"box","text":"Fund. In some cases, such por tfolio holdings are made publicly available on a daily basis. 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BlackRock may, in cer tain cases, elect to implement internal policies and","page_number":121,"box":{"x":69,"y":90,"width":776,"height":11}},{"id":"61ee2ec4-edfa-4744-b8f2-cc2ee72151c9","block_type":"box","text":"procedures designed to limit such consequences, which may cause a Fund to be unable to engage in cer tain","page_number":121,"box":{"x":70,"y":105,"width":774,"height":11}},{"id":"9f263802-1a24-45eb-9838-0251ed6befd1","block_type":"box","text":"activities, including purchasing or disposing of securities, when it might otherwise be desirable for it to do so.","page_number":121,"box":{"x":69,"y":120,"width":781,"height":12}},{"id":"80e3b72c-6a77-4c7d-9129-8562edd3690a","block_type":"box","text":"Conflicts may also arise because por tfolio decisions regarding a Fund may benefit other accounts managed by","page_number":121,"box":{"x":69,"y":135,"width":787,"height":12}},{"id":"50d99f41-6fe4-4618-b7ab-c6ab45348abc","block_type":"box","text":"BlackRock. 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BlackRock may also determine to rely on the actions of similarly","page_number":121,"box":{"x":69,"y":355,"width":802,"height":11}},{"id":"345003c9-d743-4865-83e7-6e444b938b73","block_type":"box","text":"situated holders of loans or securities rather than, or in connection with, taking such actions itself on behalf of the","page_number":121,"box":{"x":69,"y":370,"width":817,"height":11}},{"id":"cdefb4dc-5724-4abb-bc4d-aa6a68487989","block_type":"box","text":"Funds.","page_number":121,"box":{"x":70,"y":385,"width":44,"height":9}},{"id":"caf301c5-2001-4cba-b281-c2dec4fa7d8b","block_type":"box","text":"In addition, to the extent permitted by applicable law, cer tain Funds may invest their assets in other funds","page_number":121,"box":{"x":102,"y":407,"width":755,"height":12}},{"id":"b2905437-0d52-41d7-98c7-5226dd70a04a","block_type":"box","text":"advised by BlackRock, including funds that are managed by one or more of the same por tfolio managers, which could","page_number":121,"box":{"x":69,"y":423,"width":836,"height":11}},{"id":"20a4d3cf-16d8-4b39-b18a-a1f9bb6673e1","block_type":"box","text":"result in conflicts of interest relating to asset allocation, timing of Fund purchases and redemptions, and increased","page_number":121,"box":{"x":69,"y":438,"width":821,"height":11}},{"id":"a4a6991d-1240-4f65-bdf6-8135ec28ac4f","block_type":"box","text":"remuneration and profitability for BlackRock and/or its personnel, including por tfolio managers.","page_number":121,"box":{"x":69,"y":453,"width":679,"height":11}},{"id":"df6f0830-dc14-4f8b-b7d2-cc2ab52e6a2e","block_type":"box","text":"Third par ties, including service providers to BlackRock or the Fund, may sponsor events (including, but not","page_number":121,"box":{"x":101,"y":476,"width":760,"height":11}},{"id":"6538ba07-eb97-4416-b5c1-404d2024814f","block_type":"box","text":"limited to, marketing and promotional activities and presentations, educational training programs and conferences)","page_number":121,"box":{"x":70,"y":491,"width":818,"height":11}},{"id":"2d6c8515-1703-484f-9b67-41dca018557a","block_type":"box","text":"for registered representatives, other professionals and individual investors. 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BlackRock may (but is not required to) effect purchases and sales between","page_number":121,"box":{"x":68,"y":574,"width":817,"height":11}},{"id":"ac1ace9e-a016-42bf-aed3-fe42dfc8364d","block_type":"box","text":"BlackRock clients (“cross trades”), including the Funds, if BlackRock believes such transactions are appropriate","page_number":121,"box":{"x":70,"y":589,"width":797,"height":11}},{"id":"9ea8ec0f-849f-4e4c-a144-dc0331c96d68","block_type":"box","text":"based on each par ty’s investment objectives and guidelines, subject to applicable law and regulation. 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BlackRock may have a potentially conflicting division of","page_number":121,"box":{"x":69,"y":634,"width":791,"height":12}},{"id":"6f85c622-4ed1-4a58-aee1-57156b93666c","block_type":"box","text":"loyalties and responsibilities to the par ties in such transactions.","page_number":121,"box":{"x":70,"y":650,"width":457,"height":11}},{"id":"b7c2bd40-fb10-4e8c-95a9-53756621b3bc","block_type":"box","text":"BlackRock and its clients may pursue or enforce rights with respect to an issuer in which a Fund has invested,","page_number":121,"box":{"x":102,"y":672,"width":784,"height":11}},{"id":"f2ac56a6-a54d-4295-9b5c-7377b4b9308a","block_type":"box","text":"and those activities may have an adverse effect on the Fund. As a result, prices, availability, liquidity and terms of the","page_number":121,"box":{"x":69,"y":687,"width":840,"height":11}},{"id":"c35a7142-af21-4eeb-96cf-d47bae1cd2ba","block_type":"box","text":"Fund’s investments may be negatively impacted by the activities of BlackRock or its clients, and transactions for the","page_number":121,"box":{"x":70,"y":702,"width":827,"height":12}},{"id":"de895cbf-4b41-4a67-91c7-365dadce5b5c","block_type":"box","text":"Fund may be impaired or effected at prices or terms that may be less favorable than would otherwise have been the","page_number":121,"box":{"x":70,"y":717,"width":828,"height":12}},{"id":"abf14e42-681a-429d-9151-123bffe6d46e","block_type":"box","text":"case.","page_number":121,"box":{"x":69,"y":735,"width":37,"height":7}},{"id":"dbc0ed23-a148-49ec-acf9-6bf84bef4142","block_type":"box","text":"The results of a Fund’s investment activities may differ significantly from the results achieved by BlackRock for","page_number":121,"box":{"x":101,"y":755,"width":791,"height":11}},{"id":"39a7b5b8-eeca-4d36-ae8a-64c35270fb8d","block_type":"box","text":"its proprietary accounts or other accounts (including investment companies or collective investment vehicles) that it","page_number":121,"box":{"x":70,"y":771,"width":824,"height":11}},{"id":"ce2a6201-2ca4-465b-af78-3a66dd51435a","block_type":"box","text":"manages or advises. It is possible that one or more accounts managed or advised by BlackRock and such other","page_number":121,"box":{"x":69,"y":786,"width":798,"height":11}},{"id":"a3046969-f56c-42d4-bcc0-b04ab7a67683","block_type":"box","text":"accounts will achieve investment results that are substantially more or less favorable than the results achieved by a","page_number":121,"box":{"x":69,"y":801,"width":828,"height":11}},{"id":"9dd02e2a-def8-4698-986b-e71b43e9ef3d","block_type":"box","text":"Fund. Moreover, it is possible that a Fund will sustain losses during periods in which one or more proprietary or other","page_number":121,"box":{"x":70,"y":816,"width":835,"height":11}},{"id":"c93a8e38-d8d8-4a07-931d-852122fc000d","block_type":"box","text":"accounts managed or advised by BlackRock achieve significant profits. The opposite result is also possible.","page_number":121,"box":{"x":69,"y":831,"width":767,"height":11}},{"id":"ccc5604b-8698-46ca-90cf-33b59cffce5f","block_type":"box","text":"From time to time, a Fund may be restricted from purchasing or selling securities, or from engaging in other","page_number":121,"box":{"x":102,"y":853,"width":766,"height":12}},{"id":"e5cb3b6c-223e-4c8c-9962-f4f1e83921d4","block_type":"box","text":"investment activities because of regulatory, legal or contractual requirements applicable to BlackRock or other","page_number":121,"box":{"x":70,"y":869,"width":786,"height":11}},{"id":"16489387-8a44-41d4-b09a-b8536d67b940","block_type":"box","text":"accounts managed or advised by BlackRock, and/or the internal policies of BlackRock designed to comply with such","page_number":121,"box":{"x":69,"y":884,"width":828,"height":11}},{"id":"599ff5b1-5d75-467d-8483-015d7a443f93","block_type":"box","text":"requirements. As a result, there may be periods, for example, when BlackRock will not initiate or recommend cer tain","page_number":121,"box":{"x":69,"y":899,"width":831,"height":11}},{"id":"3ed2325e-297c-45ec-aebd-dce31e1b57fa","block_type":"box","text":"II-90","page_number":121,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"08af3904-7c8d-4c36-960c-5aa8ac4fe19a","block_type":"box","text":"NM1026U-5982568-121/232","page_number":121,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"fd173f72-f0f3-4de4-a16d-df10d5114b68","block_type":"box","text":"types of transactions in cer tain securities or instruments with respect to which BlackRock is per forming services or","page_number":122,"box":{"x":68,"y":45,"width":825,"height":11}},{"id":"13397b7b-cf43-474a-8e9a-56c0e1fc590a","block_type":"box","text":"when position limits have been reached. For example, the investment activities of BlackRock for its proprietary","page_number":122,"box":{"x":68,"y":60,"width":790,"height":11}},{"id":"bf58b245-77b5-4064-bc0d-883f64ae5a41","block_type":"box","text":"accounts and accounts under its management may limit the investment oppor tunities for a Fund in cer tain emerging","page_number":122,"box":{"x":69,"y":75,"width":830,"height":11}},{"id":"ba9c5761-90dd-4838-8db4-5b4f36bfd0a5","block_type":"box","text":"and other markets in which limitations are imposed upon the amount of investment, in the aggregate or in individual","page_number":122,"box":{"x":69,"y":90,"width":827,"height":11}},{"id":"0752581a-2169-4b5b-b842-a98301791adc","block_type":"box","text":"issuers, by affiliated foreign investors.","page_number":122,"box":{"x":70,"y":105,"width":271,"height":11}},{"id":"9276166f-314a-483e-8a60-d0df2f8c7054","block_type":"box","text":"In connection with its management of a Fund, BlackRock may have access to cer tain fundamental analysis and","page_number":122,"box":{"x":102,"y":128,"width":792,"height":11}},{"id":"0103b84a-1ec2-4405-ac4c-cec18ce2b4d0","block_type":"box","text":"proprietary technical models developed by BlackRock. BlackRock will not be under any obligation, however, to effect","page_number":122,"box":{"x":70,"y":143,"width":826,"height":11}},{"id":"9432c051-fa92-4a73-801f-7ae357ab540c","block_type":"box","text":"transactions on behalf of a Fund in accordance with such analysis and models. In addition, BlackRock will not have","page_number":122,"box":{"x":68,"y":158,"width":821,"height":11}},{"id":"7e7157e4-752f-4dd6-8b34-defe6f51e8a0","block_type":"box","text":"any obligation to make available any information regarding its proprietary activities or strategies, or the activities or","page_number":122,"box":{"x":69,"y":173,"width":821,"height":11}},{"id":"a34dfea0-f952-4f36-9333-c1dc315ad8de","block_type":"box","text":"strategies used for other accounts managed by them, for the benefit of the management of a Fund and it is not","page_number":122,"box":{"x":69,"y":188,"width":793,"height":12}},{"id":"f84169e8-7f03-485e-8bc2-55d3865d4112","block_type":"box","text":"anticipated that BlackRock will have access to such information for the purpose of managing the Fund. The","page_number":122,"box":{"x":69,"y":203,"width":762,"height":12}},{"id":"fdab68aa-4f87-45c2-a643-b5277fe49fdd","block_type":"box","text":"proprietary activities or por tfolio strategies of BlackRock, or the activities or strategies used for accounts managed by","page_number":122,"box":{"x":70,"y":218,"width":839,"height":12}},{"id":"2e30d50a-f94c-4811-b670-d1139c0f9626","block_type":"box","text":"BlackRock or other client accounts could conflict with the transactions and strategies employed by BlackRock in","page_number":122,"box":{"x":70,"y":234,"width":795,"height":11}},{"id":"7b1f71b7-c741-45f9-a729-ec36ec6f5484","block_type":"box","text":"managing a Fund.","page_number":122,"box":{"x":69,"y":249,"width":124,"height":11}},{"id":"38c8703e-51dc-436d-94e6-9f73b7c40310","block_type":"box","text":"The Funds may be included in investment models developed by BlackRock for use by clients and financial","page_number":122,"box":{"x":101,"y":271,"width":751,"height":12}},{"id":"a417f477-0f1f-4115-9f15-2107eb41b826","block_type":"box","text":"advisors. To the extent clients invest in these investment models and increase the assets under management of the","page_number":122,"box":{"x":69,"y":286,"width":830,"height":12}},{"id":"c565a5fa-74f0-4fc5-9911-9514e820f11e","block_type":"box","text":"Funds, the investment management fee amounts paid by the Funds to BlackRock may also increase. The net asset","page_number":122,"box":{"x":70,"y":302,"width":820,"height":11}},{"id":"89898bec-4142-46c1-a076-1e86de7e9c09","block_type":"box","text":"value and liquidity of a Fund may be impacted by purchases and sales of the Fund by model-driven investment","page_number":122,"box":{"x":68,"y":317,"width":785,"height":11}},{"id":"cc4955a4-1bdb-4c6d-b94f-691013606269","block_type":"box","text":"por tfolios, as well as by BlackRock itself and by its advisory clients.","page_number":122,"box":{"x":70,"y":332,"width":481,"height":11}},{"id":"ee2516ce-d5dc-42ad-99be-449402c40ce0","block_type":"box","text":"In addition, cer tain principals and cer tain employees of a Fund’s investment adviser are also principals or","page_number":122,"box":{"x":102,"y":355,"width":754,"height":11}},{"id":"0624e6cc-0ba2-421f-a858-bf3656dd7ca3","block_type":"box","text":"employees of other business units or entities within BlackRock. As a result, these principals and employees may","page_number":122,"box":{"x":69,"y":370,"width":804,"height":11}},{"id":"063d68ec-1031-470f-8b17-029177eb06c1","block_type":"box","text":"have obligations to such other business units or entities or their clients and such obligations to other business units","page_number":122,"box":{"x":69,"y":385,"width":831,"height":11}},{"id":"78e81f86-93df-45a0-a2eb-bea4d13e9f43","block_type":"box","text":"or entities or their clients may be a consideration of which investors in a Fund should be aware.","page_number":122,"box":{"x":69,"y":400,"width":680,"height":11}},{"id":"ce0289c6-1c4d-4b75-bda5-cccc43f33bc5","block_type":"box","text":"BlackRock may enter into transactions and invest in securities, instruments and currencies on behalf of a Fund","page_number":122,"box":{"x":102,"y":423,"width":791,"height":11}},{"id":"c428d3e6-e567-4c7f-91d6-cd836f35d387","block_type":"box","text":"in which clients of BlackRock, or, to the extent permitted by the Commission and applicable law, BlackRock, serves","page_number":122,"box":{"x":70,"y":438,"width":820,"height":11}},{"id":"e2baa7a7-7e20-4802-ae5a-ea2cd890e531","block_type":"box","text":"as the counterpar ty, principal or issuer. In such cases, such par ty’s interests in the transaction will be adverse to the","page_number":122,"box":{"x":69,"y":453,"width":837,"height":11}},{"id":"585c8ee8-c0bd-45ab-ab1b-fbe68933e8e2","block_type":"box","text":"interests of the Fund, and such par ty may have no incentive to assure that the Fund obtains the best possible prices","page_number":122,"box":{"x":70,"y":468,"width":832,"height":11}},{"id":"42e48808-e49f-4f9f-8b17-48979b4ef6a2","block_type":"box","text":"or terms in connection with the transactions. In addition, the purchase, holding and sale of such investments by a","page_number":122,"box":{"x":69,"y":483,"width":813,"height":11}},{"id":"8fa5d812-977c-43c2-a3c3-d07a96713647","block_type":"box","text":"Fund may enhance the profitability of BlackRock.","page_number":122,"box":{"x":70,"y":498,"width":344,"height":11}},{"id":"f3c18c50-bfa6-4c26-8db3-eb4ee3294c97","block_type":"box","text":"BlackRock may also create, write or issue derivatives for clients, the underlying securities, currencies or","page_number":122,"box":{"x":102,"y":521,"width":741,"height":11}},{"id":"3556cc12-38c3-4ea7-b795-0ff917b3b453","block_type":"box","text":"instruments of which may be those in which a Fund invests or which may be based on the per formance of the Fund.","page_number":122,"box":{"x":70,"y":536,"width":824,"height":11}},{"id":"c859f486-8f75-4105-95f6-5ec2794a4a5d","block_type":"box","text":"Additionally, an affiliate of BlackRock will create, write or issue options, which may be based on the per formance of","page_number":122,"box":{"x":68,"y":551,"width":825,"height":11}},{"id":"e3b76929-27d1-400f-80b9-f31282cf2329","block_type":"box","text":"cer tain Funds. BlackRock has entered into an arrangement with Markit Indices Limited, the index provider for","page_number":122,"box":{"x":69,"y":566,"width":777,"height":11}},{"id":"e770d373-f167-4de6-9588-4726baac829f","block_type":"box","text":"underlying fixed-income indexes used by cer tain iShares ETFs, related to derivative fixed-income products that are","page_number":122,"box":{"x":69,"y":581,"width":810,"height":12}},{"id":"7b623bc6-6e86-4701-827e-8c3ad2bf6427","block_type":"box","text":"based on such iShares ETFs. Trading activity in these derivative products could also potentially lead to greater","page_number":122,"box":{"x":69,"y":597,"width":784,"height":11}},{"id":"29afab10-bf55-4fb8-96a3-7cb22e8ba344","block_type":"box","text":"liquidity for such products, increased purchase activity with respect to these iShares ETFs and increased assets","page_number":122,"box":{"x":70,"y":612,"width":798,"height":11}},{"id":"e4897df8-49e0-4838-8845-9849dd02d009","block_type":"box","text":"under management for BlackRock.","page_number":122,"box":{"x":69,"y":627,"width":243,"height":11}},{"id":"3b2ad86b-b799-4833-8d9b-f5ddf2368b8a","block_type":"box","text":"A Fund may, subject to applicable law, purchase investments that are the subject of an underwriting or other","page_number":122,"box":{"x":101,"y":649,"width":773,"height":12}},{"id":"34ba235a-54f9-4c23-bcc6-2f45c863c800","block_type":"box","text":"distribution by BlackRock and may also enter into transactions with other clients of BlackRock where such other","page_number":122,"box":{"x":69,"y":664,"width":797,"height":12}},{"id":"47acffb0-6268-4ba0-9176-016cc7725ee9","block_type":"box","text":"clients have interests adverse to those of the Fund. At times, these activities may cause business units or entities","page_number":122,"box":{"x":69,"y":680,"width":817,"height":11}},{"id":"32882689-c7ff-4ff6-9090-372058c37b77","block_type":"box","text":"within BlackRock to give advice to clients that may cause these clients to take actions adverse to the interests of the","page_number":122,"box":{"x":68,"y":695,"width":837,"height":11}},{"id":"700d3cf2-3557-4cdc-810d-b0c482a96da9","block_type":"box","text":"Fund. To the extent such transactions are permitted, a Fund will deal with BlackRock on an arms-length basis.","page_number":122,"box":{"x":70,"y":710,"width":781,"height":11}},{"id":"3d69c80b-94e4-4041-8067-02704450e05d","block_type":"box","text":"To the extent authorized by applicable law, BlackRock may act as broker, dealer, agent, lender or adviser or in","page_number":122,"box":{"x":101,"y":733,"width":779,"height":11}},{"id":"881b26b4-a214-4e87-94b7-b80998ab09cb","block_type":"box","text":"other commercial capacities for a Fund. It is anticipated that the commissions, mark-ups, mark-downs, financial","page_number":122,"box":{"x":69,"y":748,"width":795,"height":11}},{"id":"d85a6e6a-1472-44e4-bf91-bd2576e03091","block_type":"box","text":"advisory fees, underwriting and placement fees, sales fees, financing and commitment fees, brokerage fees, other","page_number":122,"box":{"x":69,"y":763,"width":821,"height":11}},{"id":"7a304c06-584e-42f4-9903-dc736ca8077f","block_type":"box","text":"fees, compensation or profits, rates, terms and conditions charged by BlackRock will be in its view commercially","page_number":122,"box":{"x":68,"y":778,"width":802,"height":11}},{"id":"0745a084-4863-4f2f-aa84-aa52fea31eaa","block_type":"box","text":"reasonable, although BlackRock, including its sales personnel, will have an interest in obtaining fees and other","page_number":122,"box":{"x":69,"y":793,"width":792,"height":11}},{"id":"b3680c9c-5556-4ae6-960d-270c0255ce03","block_type":"box","text":"amounts that are favorable to BlackRock and such sales personnel, which may have an adverse effect on the Funds.","page_number":122,"box":{"x":69,"y":808,"width":832,"height":11}},{"id":"80354bc6-d3a7-4e20-87b4-beb178828863","block_type":"box","text":"Index based funds may use an index provider that is affiliated with another service provider of the Fund or BlackRock","page_number":122,"box":{"x":70,"y":823,"width":833,"height":11}},{"id":"1d418ced-7907-4f42-9d00-bdeec2962be8","block_type":"box","text":"that acts as a broker, dealer, agent, lender or in other commercial capacities for a Fund or BlackRock.","page_number":122,"box":{"x":68,"y":838,"width":726,"height":12}},{"id":"7ed6a7e0-a0b9-4be1-b858-a2e3f5cc183d","block_type":"box","text":"Subject to applicable law, BlackRock (and its personnel and other distributors) will be entitled to retain fees and","page_number":122,"box":{"x":102,"y":861,"width":796,"height":11}},{"id":"b3514013-1a7b-4b7c-8de7-5ac972070dcc","block_type":"box","text":"other amounts that they receive in connection with their service to the Funds as broker, dealer, agent, lender, adviser","page_number":122,"box":{"x":69,"y":876,"width":837,"height":11}},{"id":"a73e4a7d-a8a2-4da4-a546-3e6285000148","block_type":"box","text":"or in other commercial capacities. No accounting to the Funds or their shareholders will be required, and no fees or","page_number":122,"box":{"x":69,"y":891,"width":823,"height":12}},{"id":"6edc2d20-0faf-49fb-a48a-1591cc4cf97a","block_type":"box","text":"II-91","page_number":122,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"f5894c59-8bc1-4f60-9166-fb502f661a1d","block_type":"box","text":"NM1026U-5982568-122/232","page_number":122,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"c1fbd210-0de7-43ed-9146-9bab0bc93b29","block_type":"box","text":"other compensation payable by the Funds or their shareholders will be reduced by reason of receipt by BlackRock of","page_number":123,"box":{"x":69,"y":45,"width":828,"height":11}},{"id":"a09d51e0-1fd4-43ca-b8af-4a91d42b5ca4","block_type":"box","text":"any such fees or other amounts.","page_number":123,"box":{"x":69,"y":60,"width":230,"height":11}},{"id":"43ebe186-8d32-4043-8bb2-823f7f33906e","block_type":"box","text":"When BlackRock acts as broker, dealer, agent, adviser or in other commercial capacities in relation to the Funds,","page_number":123,"box":{"x":101,"y":83,"width":805,"height":11}},{"id":"1401ee5f-0f22-4495-8aa0-ccae372e352d","block_type":"box","text":"BlackRock may take commercial steps in its own interests, which may have an adverse effect on the Funds.","page_number":123,"box":{"x":70,"y":98,"width":768,"height":11}},{"id":"373cd7ff-107b-42d9-aec3-a9fbabf1bf6b","block_type":"box","text":"A Fund will be required to establish business relationships with its counterpar ties based on the Fund’s own","page_number":123,"box":{"x":101,"y":120,"width":766,"height":11}},{"id":"4b87e17b-732e-4bfa-92df-1294f1936c98","block_type":"box","text":"credit standing. BlackRock will not have any obligation to allow its credit to be used in connection with a Fund’s","page_number":123,"box":{"x":69,"y":136,"width":793,"height":11}},{"id":"aa62081b-213c-4f77-b5da-8a8cfc67cf87","block_type":"box","text":"establishment of its business relationships, nor is it expected that the Fund’s counterpar ties will rely on the credit of","page_number":123,"box":{"x":69,"y":150,"width":835,"height":12}},{"id":"c311729b-0a3e-42ed-a1fb-91147fbaa192","block_type":"box","text":"BlackRock in evaluating the Fund’s creditwor thiness.","page_number":123,"box":{"x":70,"y":166,"width":374,"height":11}},{"id":"3bbfc359-feaf-4f94-82b4-beeb976f8a1d","block_type":"box","text":"BlackRock Investment Management, LLC (“BIM”) or BlackRock Institutional Trust Company, N.A. (“BTC”), as","page_number":123,"box":{"x":102,"y":188,"width":768,"height":12}},{"id":"5e7956c8-875f-4b7a-b998-daa896e25874","block_type":"box","text":"applicable, each an affiliate of BlackRock, pursuant to SEC exemptive relief, acts as securities lending agent to, and","page_number":123,"box":{"x":69,"y":203,"width":829,"height":12}},{"id":"0fe8f5f8-766c-4e5c-b976-3b1c4a24ad02","block_type":"box","text":"receives a share of securities lending revenues from, the Funds. BlackRock will also receive compensation for","page_number":123,"box":{"x":69,"y":218,"width":785,"height":12}},{"id":"fecbe7dd-df9d-405f-83d2-42b0b2e35f33","block_type":"box","text":"managing the reinvestment of the cash collateral from securities lending. There are potential conflicts of interests in","page_number":123,"box":{"x":69,"y":234,"width":829,"height":11}},{"id":"c203e997-6b86-4b3c-be35-be1b714b5de0","block_type":"box","text":"managing a securities lending program, including but not limited to: (i) BlackRock as securities lending agent may","page_number":123,"box":{"x":69,"y":249,"width":809,"height":11}},{"id":"78075f8b-8c57-47c3-8949-8fbe5e0b2cb7","block_type":"box","text":"have an incentive to, among other things, increase or decrease the amount of securities on loan or to lend par ticular","page_number":123,"box":{"x":69,"y":264,"width":833,"height":11}},{"id":"0154d6c2-2b13-4d73-a094-368186194a21","block_type":"box","text":"securities in order to generate additional risk-adjusted revenue for BlackRock and its affiliates; and (ii) BlackRock as","page_number":123,"box":{"x":69,"y":279,"width":829,"height":11}},{"id":"aedaf388-1bec-4db7-a4f4-ac8a9e0c5aca","block_type":"box","text":"securities lending agent may have an incentive to allocate loans to clients that would provide more revenue to","page_number":123,"box":{"x":69,"y":294,"width":783,"height":11}},{"id":"77b69ac6-bb14-4a00-9d5e-7f6ca655a9cb","block_type":"box","text":"BlackRock. As described fur ther below, BlackRock seeks to mitigate this conflict by providing its securities lending","page_number":123,"box":{"x":70,"y":309,"width":814,"height":11}},{"id":"02e59b00-094b-4e65-b9ff-a9b5842df76d","block_type":"box","text":"clients with equal lending oppor tunities over time in order to approximate pro rata allocation.","page_number":123,"box":{"x":69,"y":325,"width":660,"height":11}},{"id":"156e7ae8-94b7-41ce-9d8f-a82575831d9c","block_type":"box","text":"As par t of its securities lending program, BlackRock indemnifies the Funds and cer tain other clients and/or","page_number":123,"box":{"x":101,"y":347,"width":767,"height":11}},{"id":"315b6404-d9c0-4cc8-84d5-ccf8b4cdffdc","block_type":"box","text":"funds against a shor tfall in collateral in the event of borrower default. On a regular basis, BlackRock calculates the","page_number":123,"box":{"x":68,"y":362,"width":820,"height":11}},{"id":"9f7ff1ef-e42c-41ae-a73b-a0c5a41e2309","block_type":"box","text":"potential dollar exposure of collateral shor tfall resulting from a borrower default (“shor tfall risk”) in the securities","page_number":123,"box":{"x":70,"y":377,"width":806,"height":12}},{"id":"70fa4658-81d3-4367-aaee-71208a9e9164","block_type":"box","text":"lending program. BlackRock establishes program-wide borrower limits (“credit limits”) to actively manage borrower","page_number":123,"box":{"x":70,"y":393,"width":816,"height":11}},{"id":"f56f7134-f939-4ce4-a0de-f0502cc1147f","block_type":"box","text":"specific credit exposure. BlackRock oversees the risk model that calculates projected collateral shor tfall values using","page_number":123,"box":{"x":69,"y":407,"width":838,"height":12}},{"id":"c6135696-3442-4c39-b52f-0af97ca905a7","block_type":"box","text":"loan-level factors such as loan and collateral type and market value as well as specific borrower credit","page_number":123,"box":{"x":70,"y":423,"width":727,"height":11}},{"id":"20100629-4541-43a1-8c31-c58e43c3b8c8","block_type":"box","text":"characteristics. When necessary, BlackRock may adjust securities lending program attributes by restricting eligible","page_number":123,"box":{"x":69,"y":438,"width":815,"height":11}},{"id":"c3caddce-3ac1-4965-b800-5fb1a77eca24","block_type":"box","text":"collateral or reducing borrower credit limits. As a result, the management of program-wide exposure as well as","page_number":123,"box":{"x":69,"y":453,"width":786,"height":11}},{"id":"06b862ed-c6c1-4548-858a-4d8d5a084b28","block_type":"box","text":"BlackRock-specific indemnification exposure may affect the amount of securities lending activity BlackRock may","page_number":123,"box":{"x":70,"y":468,"width":796,"height":11}},{"id":"100214e8-8f60-4ef8-bca0-09b5bcf5b5af","block_type":"box","text":"conduct at any given point in time by reducing the volume of lending oppor tunities for cer tain loans (including by","page_number":123,"box":{"x":69,"y":483,"width":799,"height":11}},{"id":"162044e6-0022-40ae-8a06-55ea54f4e9bb","block_type":"box","text":"asset type, collateral type and/or revenue profile).","page_number":123,"box":{"x":69,"y":498,"width":356,"height":11}},{"id":"c479ccc7-9f21-446a-9ad9-8e7bfeb23ebb","block_type":"box","text":"BlackRock may decline to make a securities loan on behalf of a Fund, discontinue lending on behalf of a Fund or","page_number":123,"box":{"x":102,"y":521,"width":801,"height":11}},{"id":"528ba60b-66ea-48db-b0c5-dbd39c98179a","block_type":"box","text":"terminate a securities loan on behalf of a Fund for any reason, including but not limited to regulatory requirements","page_number":123,"box":{"x":68,"y":536,"width":817,"height":11}},{"id":"bb6ec342-f504-4ab3-ae7f-4b4992401a56","block_type":"box","text":"and/or market rules, liquidity considerations, or credit considerations, which may impact Funds by reducing or","page_number":123,"box":{"x":69,"y":551,"width":784,"height":11}},{"id":"fa327bec-4579-4deb-990e-2eb2310fff00","block_type":"box","text":"eliminating the volume of lending oppor tunities for cer tain types of loans, loans in par ticular markets, loans of","page_number":123,"box":{"x":69,"y":566,"width":789,"height":11}},{"id":"3510e9a3-7385-44c5-9590-f6cbd215b0c3","block_type":"box","text":"par ticular securities or types of securities, or for loans overall. In addition, some borrowers may prefer cer tain","page_number":123,"box":{"x":70,"y":581,"width":783,"height":11}},{"id":"0d4cbf6c-305b-4525-ab34-8065e36cf9f4","block_type":"box","text":"BlackRock lenders that provide additional protections against lender default that are favored by their prudential","page_number":123,"box":{"x":70,"y":596,"width":790,"height":12}},{"id":"4523b5dc-ec02-4362-9a91-066790fa4d9b","block_type":"box","text":"regulation.","page_number":123,"box":{"x":69,"y":612,"width":73,"height":11}},{"id":"501a2f79-3056-46c5-bf3f-a4fcc6272319","block_type":"box","text":"BlackRock uses a predetermined systematic process in order to approximate pro rata allocation over time. In","page_number":123,"box":{"x":102,"y":634,"width":777,"height":11}},{"id":"36a5a817-d053-4919-abb5-7829cb8d64b0","block_type":"box","text":"order to allocate a loan to a por tfolio: (i) BlackRock as a whole must have sufficient lending capacity pursuant to the","page_number":123,"box":{"x":69,"y":649,"width":830,"height":12}},{"id":"5e9bd8a7-3d00-4342-b8ae-d22166b0580e","block_type":"box","text":"various program limits (","page_number":123,"box":{"x":68,"y":665,"width":168,"height":11}},{"id":"0ae39c27-7a77-4aac-b2b4-47898f1cbc66","block_type":"box","text":"i.e.","page_number":123,"box":{"x":238,"y":665,"width":20,"height":8}},{"id":"33045c18-31fb-49a0-951f-c87fc2841335","block_type":"box","text":"indemnification exposure limit and borrower credit limits); (ii) the lending por tfolio must","page_number":123,"box":{"x":265,"y":664,"width":621,"height":12}},{"id":"3641ad4f-a124-4d05-a566-1bab72680b5a","block_type":"box","text":"hold the asset at the time a loan oppor tunity arrives; and (iii) the lending por tfolio must also have enough inventory,","page_number":123,"box":{"x":69,"y":680,"width":827,"height":11}},{"id":"aad49e13-2b3d-407e-b8f5-da0a51c7885a","block_type":"box","text":"either on its own or when aggregated with other por tfolios into one single market delivery, to satisfy the loan request.","page_number":123,"box":{"x":69,"y":695,"width":836,"height":11}},{"id":"c4905d9a-45d5-4f21-8706-53f40eaf391f","block_type":"box","text":"In doing so, BlackRock seeks to provide equal lending oppor tunities for all por tfolios, independent of whether","page_number":123,"box":{"x":70,"y":710,"width":780,"height":11}},{"id":"3d065b28-8435-4008-aaa7-7c12b447d9f0","block_type":"box","text":"BlackRock indemnifies the por tfolio. Equal oppor tunities for lending por tfolios does not guarantee equal outcomes.","page_number":123,"box":{"x":70,"y":725,"width":820,"height":11}},{"id":"55cd01d5-3bc7-4b5e-9e01-2c5a5b1eafa0","block_type":"box","text":"Specifically, shor t and long-term outcomes for individual clients may vary due to asset mix, asset/liability spreads on","page_number":123,"box":{"x":69,"y":740,"width":834,"height":11}},{"id":"c02da639-6437-479b-ae68-7cdfd10c64a8","block_type":"box","text":"different securities, and the overall limits imposed by the firm.","page_number":123,"box":{"x":69,"y":755,"width":444,"height":11}},{"id":"fb1f3ec2-ea3f-4d0c-b36e-be1ea87f9a8c","block_type":"box","text":"Purchases and sales of securities and other assets for a Fund may be aggregated with orders for other","page_number":123,"box":{"x":102,"y":778,"width":734,"height":11}},{"id":"d83f8b97-55a3-44f9-b4f3-4e57551541a8","block_type":"box","text":"BlackRock client accounts, including with accounts that pay different transaction costs solely due to the fact that they","page_number":123,"box":{"x":70,"y":793,"width":840,"height":11}},{"id":"4a1bbfac-0ac6-476c-a675-200c8b2a9961","block_type":"box","text":"have different research payment arrangements. BlackRock, however, is not required to aggregate orders if por tfolio","page_number":123,"box":{"x":69,"y":808,"width":822,"height":11}},{"id":"c28a249b-e1cf-4b2b-8260-7274d9195186","block_type":"box","text":"management decisions for different accounts are made separately, or if they determine that aggregating is not","page_number":123,"box":{"x":69,"y":823,"width":788,"height":12}},{"id":"25f7a143-5a25-4ecd-8a75-307b959db5ab","block_type":"box","text":"practicable or required, or in cases involving client direction.","page_number":123,"box":{"x":70,"y":839,"width":426,"height":11}},{"id":"c6b2cd5c-2841-4ab9-b8c9-d387c911f2ff","block_type":"box","text":"Prevailing trading activity frequently may make impossible the receipt of the same price or execution on the","page_number":123,"box":{"x":102,"y":861,"width":763,"height":11}},{"id":"ab1c973f-2514-4f67-8df1-05b485b0c6eb","block_type":"box","text":"entire volume of securities purchased or sold. When this occurs, the various prices may be averaged, and the Funds","page_number":123,"box":{"x":69,"y":876,"width":828,"height":11}},{"id":"a85dafde-3083-442b-8a9b-fe256ff08012","block_type":"box","text":"will be charged or credited with the average price. Thus, the effect of the aggregation may operate on some","page_number":123,"box":{"x":68,"y":891,"width":767,"height":12}},{"id":"e0699d28-53d0-4017-a891-0f5b9fa83fe5","block_type":"box","text":"II-92","page_number":123,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"b50f0f61-cb51-41d1-a126-ec56b4618afb","block_type":"box","text":"NM1026U-5982568-123/232","page_number":123,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"eb73d5d2-2652-4fc7-b164-1ec25932b156","block_type":"box","text":"occasions to the disadvantage of the Funds. In addition, under cer tain circumstances, the Funds will not be charged","page_number":124,"box":{"x":69,"y":45,"width":828,"height":11}},{"id":"592a1671-6241-4bcb-992f-82a62247ba5f","block_type":"box","text":"the same commission or commission equivalent rates in connection with an aggregated order.","page_number":124,"box":{"x":68,"y":60,"width":672,"height":11}},{"id":"20afa72f-796d-41c4-8839-1b453f23df5c","block_type":"box","text":"As discussed in the section below entitled “Por tfolio Transactions and Brokerage—Transactions in Por tfolio","page_number":124,"box":{"x":101,"y":82,"width":767,"height":12}},{"id":"4ba17092-e567-4950-b67c-84bc312b392a","block_type":"box","text":"Securities,” BlackRock, unless prohibited by applicable law, may cause a Fund or account to pay a broker or dealer a","page_number":124,"box":{"x":69,"y":98,"width":832,"height":11}},{"id":"df1f3f3e-184b-4a17-bdd7-4b3160ce38e5","block_type":"box","text":"commission for effecting a transaction that exceeds the amount another broker or dealer would have charged for","page_number":124,"box":{"x":69,"y":113,"width":805,"height":11}},{"id":"eeffa070-c272-4655-a5c1-2d9610fcf977","block_type":"box","text":"effecting the same transaction in recognition of the value of brokerage and research services provided by that broker","page_number":124,"box":{"x":69,"y":128,"width":836,"height":11}},{"id":"6f97bb30-ac84-4085-9c4f-9af7bae968cc","block_type":"box","text":"or dealer. Under MiFID II, EU investment managers, including BlackRock International Limited (“BIL”) which acts as a","page_number":124,"box":{"x":69,"y":143,"width":831,"height":11}},{"id":"58fd44d0-9bea-4d95-a8c3-c1bdfb230fde","block_type":"box","text":"sub-adviser to cer tain Funds, pay for research from brokers and dealers directly out of their own resources, rather","page_number":124,"box":{"x":69,"y":158,"width":812,"height":11}},{"id":"184198b1-3167-402a-87d8-c995c94ca9ad","block_type":"box","text":"than through client commissions.","page_number":124,"box":{"x":68,"y":173,"width":237,"height":11}},{"id":"1b975f9a-3408-4190-9ec2-07294147e945","block_type":"box","text":"Subject to applicable law, BlackRock may select brokers that furnish BlackRock, the Funds, other BlackRock","page_number":124,"box":{"x":102,"y":196,"width":770,"height":11}},{"id":"8cedf15a-565d-454a-840e-b2b3ade95815","block_type":"box","text":"client accounts or personnel, directly or through correspondent relationships, with research or other appropriate","page_number":124,"box":{"x":69,"y":211,"width":797,"height":11}},{"id":"e5811668-d8b2-42f8-a2ea-51e335b60701","block_type":"box","text":"services which provide, in BlackRock’s view, appropriate assistance to BlackRock in the investment decision making","page_number":124,"box":{"x":69,"y":226,"width":830,"height":11}},{"id":"24793d5d-51be-4c85-88f6-59288c262fb7","block_type":"box","text":"process (including with respect to futures, fixed-price offerings and OTC transactions). Such research or other","page_number":124,"box":{"x":70,"y":241,"width":780,"height":11}},{"id":"3c8187ed-131d-478b-a52d-b1a5d282e62c","block_type":"box","text":"services may include, to the extent permitted by law, research repor ts on companies, industries and securities;","page_number":124,"box":{"x":69,"y":257,"width":795,"height":10}},{"id":"7f74ff7c-09b4-429e-ba46-2efbb80bb4a6","block_type":"box","text":"economic and financial data; financial publications; proxy analysis; trade industry seminars; computer data bases;","page_number":124,"box":{"x":69,"y":271,"width":815,"height":12}},{"id":"3fab1492-e4ef-4911-8afc-33db78b5600f","block_type":"box","text":"research-oriented software and other services and products.","page_number":124,"box":{"x":69,"y":286,"width":430,"height":11}},{"id":"376acf7a-51e7-4b5f-a646-2116a8c37b49","block_type":"box","text":"Research or other services obtained in this manner may be used in servicing any or all of the Funds and other","page_number":124,"box":{"x":102,"y":309,"width":785,"height":11}},{"id":"47a41f12-4bbf-460a-860e-d4b9a98a0fba","block_type":"box","text":"BlackRock client accounts, including in connection with BlackRock client accounts other than those that pay","page_number":124,"box":{"x":70,"y":325,"width":768,"height":11}},{"id":"e753033f-7d67-49ee-b403-45b7f3abe594","block_type":"box","text":"commissions to the broker relating to the research or other service arrangements. Such products and services may","page_number":124,"box":{"x":69,"y":340,"width":826,"height":11}},{"id":"f451bf01-db24-4438-967a-ce4e14af8fee","block_type":"box","text":"dispropor tionately benefit other BlackRock client accounts relative to the Funds based on the amount of brokerage","page_number":124,"box":{"x":69,"y":355,"width":818,"height":11}},{"id":"14f4a4df-9dd9-4468-b5a5-02555066bc63","block_type":"box","text":"commissions paid by the Funds and such other BlackRock client accounts. For example, research or other services","page_number":124,"box":{"x":69,"y":370,"width":821,"height":11}},{"id":"9e600203-7917-4f69-8ad8-2d7b6347c0cd","block_type":"box","text":"that are paid for through one client’s commissions may not be used in managing that client’s account. In addition,","page_number":124,"box":{"x":68,"y":385,"width":815,"height":11}},{"id":"0e93b173-dbad-46ba-8f48-625ed098ac08","block_type":"box","text":"other BlackRock client accounts may receive the benefit, including dispropor tionate benefits, of economies of scale","page_number":124,"box":{"x":69,"y":400,"width":824,"height":11}},{"id":"7ad70e26-619d-433e-a1e1-6418fbfb1c3a","block_type":"box","text":"or price discounts in connection with products and services that may be provided to the Funds and to such other","page_number":124,"box":{"x":69,"y":415,"width":804,"height":11}},{"id":"7bc3dc8e-2173-4e10-bba1-c154ce0974a5","block_type":"box","text":"BlackRock client accounts. To the extent that BlackRock uses soft dollars, it will not have to pay for those products","page_number":124,"box":{"x":70,"y":430,"width":819,"height":11}},{"id":"2734917f-626d-4051-9e51-c897486ce082","block_type":"box","text":"and services itself.","page_number":124,"box":{"x":69,"y":445,"width":134,"height":9}},{"id":"4dd8d17f-2331-4863-854e-0fbb92d914a2","block_type":"box","text":"BlackRock, unless prohibited by applicable law, may endeavor to execute trades through brokers who, pursuant","page_number":124,"box":{"x":102,"y":468,"width":793,"height":11}},{"id":"9e55655a-f03b-42c4-bd77-47b1fbe97c9c","block_type":"box","text":"to such arrangements, provide research or other services in order to ensure the continued receipt of research or","page_number":124,"box":{"x":68,"y":483,"width":805,"height":11}},{"id":"c347bde2-386a-4cb9-92c5-0df6f25dc860","block_type":"box","text":"other services BlackRock believes are useful in its investment decision-making process. BlackRock may from time to","page_number":124,"box":{"x":69,"y":498,"width":833,"height":11}},{"id":"b6e533dd-507e-42e0-aa32-216108ca7780","block_type":"box","text":"time choose not to engage in the above described arrangements to varying degrees. BlackRock, unless prohibited by","page_number":124,"box":{"x":68,"y":514,"width":836,"height":11}},{"id":"8fe5d2d4-93f2-4395-8663-719e3a174a6d","block_type":"box","text":"applicable law, may also enter into commission sharing arrangements under which BlackRock may execute","page_number":124,"box":{"x":69,"y":529,"width":760,"height":11}},{"id":"20f3dd8f-ff59-4fb2-805e-a7e4cc91bfd4","block_type":"box","text":"transactions through a broker-dealer and request that the broker-dealer allocate a por tion of the commissions or","page_number":124,"box":{"x":68,"y":543,"width":803,"height":12}},{"id":"7828a174-eec4-4611-8add-fc1ea7e45dc3","block_type":"box","text":"commission credits to another firm that provides research to BlackRock. To the extent that BlackRock engages in","page_number":124,"box":{"x":69,"y":559,"width":807,"height":11}},{"id":"b6d60c1e-3fbb-4698-a14f-737e373dea27","block_type":"box","text":"commission sharing arrangements, many of the same conflicts related to traditional soft dollars may exist.","page_number":124,"box":{"x":69,"y":574,"width":760,"height":11}},{"id":"f43f019b-734b-4458-81dc-d1db81010571","block_type":"box","text":"BlackRock may utilize cer tain electronic crossing networks (“ECNs”) (including, without limitation, ECNs in which","page_number":124,"box":{"x":102,"y":597,"width":799,"height":11}},{"id":"cf27ba93-3f08-48e1-ba20-9e3790399ef5","block_type":"box","text":"BlackRock has an investment or other interest, to the extent permitted by applicable law) in executing client","page_number":124,"box":{"x":70,"y":612,"width":767,"height":11}},{"id":"a9fc714c-4939-4ba4-813a-4114466a1500","block_type":"box","text":"securities transactions for cer tain types of securities. These ECNs may charge fees for their services, including","page_number":124,"box":{"x":69,"y":627,"width":794,"height":11}},{"id":"81091b62-7817-43f2-b37c-6f9223398768","block_type":"box","text":"access fees and transaction fees. The transaction fees, which are similar to commissions or markups/ markdowns,","page_number":124,"box":{"x":69,"y":642,"width":825,"height":11}},{"id":"dc88201f-7c2c-43c5-a1c6-59866de27f52","block_type":"box","text":"will generally be charged to clients and, like commissions and markups/markdowns, would generally be included in","page_number":124,"box":{"x":68,"y":657,"width":821,"height":11}},{"id":"61065688-f6b8-4be0-ab46-de3d6bf487ad","block_type":"box","text":"the cost of the securities purchased. Access fees may be paid by BlackRock even though incurred in connection with","page_number":124,"box":{"x":68,"y":672,"width":833,"height":11}},{"id":"68c7b12d-db87-447b-afdc-15af7fb5cfab","block_type":"box","text":"executing transactions on behalf of clients, including the Funds. In cer tain circumstances, ECNs may offer volume","page_number":124,"box":{"x":69,"y":687,"width":812,"height":11}},{"id":"28564508-6b17-419b-8013-f2d6b9a8ffb3","block_type":"box","text":"discounts that will reduce the access fees typically paid by BlackRock. BlackRock will only utilize ECNs consistent","page_number":124,"box":{"x":69,"y":702,"width":809,"height":11}},{"id":"c1391dc3-7a9b-45f1-8e07-beafb895861c","block_type":"box","text":"with its obligation to seek to obtain best execution in client transactions.","page_number":124,"box":{"x":68,"y":718,"width":519,"height":11}},{"id":"3e0180f7-7c23-4e2b-89a1-1f7c30ac41e1","block_type":"box","text":"BlackRock owns a minority interest in, and is a member of, Members Exchange (“MEMX”), a newly created U.S.","page_number":124,"box":{"x":102,"y":740,"width":793,"height":11}},{"id":"c43ef70c-0f97-4871-876a-e2efce81f69f","block_type":"box","text":"stock exchange. Transactions for a Fund may be executed on MEMX if third par ty brokers select MEMX as the","page_number":124,"box":{"x":69,"y":755,"width":782,"height":11}},{"id":"72727ef8-6bbf-495f-b008-28a2daf7967a","block_type":"box","text":"appropriate venue for execution of orders placed by BlackRock traders on behalf of client por tfolios.","page_number":124,"box":{"x":69,"y":770,"width":710,"height":11}},{"id":"6c4187db-0364-4445-b13b-e7ebf3cfcb7d","block_type":"box","text":"BlackRock has adopted policies and procedures designed to prevent conflicts of interest from influencing proxy","page_number":124,"box":{"x":102,"y":793,"width":792,"height":11}},{"id":"4d073293-d962-42b6-8d92-b2c4b46ee75d","block_type":"box","text":"voting decisions that it makes on behalf of advisory clients, including the Funds, and to help ensure that such","page_number":124,"box":{"x":68,"y":808,"width":784,"height":11}},{"id":"a9854686-1ac3-4504-9e44-23db90ba6267","block_type":"box","text":"decisions are made in accordance with BlackRock’s fiduciary obligations to its clients. Never theless, notwithstanding","page_number":124,"box":{"x":69,"y":823,"width":837,"height":12}},{"id":"828a5beb-11a1-43b6-9760-13fdb821a6ef","block_type":"box","text":"such proxy voting policies and procedures, actual proxy voting decisions of BlackRock may have the effect of favoring","page_number":124,"box":{"x":69,"y":838,"width":835,"height":12}},{"id":"c4bb31ac-c8fd-4517-8461-ebceb7aa3ff8","block_type":"box","text":"the interests of other clients or businesses of other divisions or units of BlackRock, provided that BlackRock believes","page_number":124,"box":{"x":68,"y":853,"width":837,"height":11}},{"id":"5c7a5097-1d99-4e7f-86e1-1e64e724fde1","block_type":"box","text":"such voting decisions to be in accordance with its fiduciary obligations. For a more detailed discussion of these","page_number":124,"box":{"x":69,"y":869,"width":795,"height":11}},{"id":"31a720e0-7940-4a16-92c6-69330fc75161","block_type":"box","text":"policies and procedures, see “Proxy Voting Policies and Procedures.”","page_number":124,"box":{"x":70,"y":884,"width":490,"height":11}},{"id":"0d0b728a-132f-487e-a6df-6766abda2464","block_type":"box","text":"II-93","page_number":124,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"d35f6cd0-2128-419d-8eb5-cdaf45177bdd","block_type":"box","text":"NM1026U-5982568-124/232","page_number":124,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"0bc6681a-69c0-4ba5-b886-79f4ae7ed0bc","block_type":"box","text":"It is also possible that, from time to time, BlackRock and/or its advisory clients (including other funds and","page_number":125,"box":{"x":102,"y":45,"width":757,"height":11}},{"id":"5a70c0a4-049a-408f-98eb-c2ea5817db28","block_type":"box","text":"separately managed accounts) may, subject to compliance with applicable law, purchase and hold shares of a Fund.","page_number":125,"box":{"x":69,"y":60,"width":825,"height":11}},{"id":"92e0f2c9-da39-4538-9c87-90fdd1ee44e0","block_type":"box","text":"Increasing a Fund’s assets may enhance investment flexibility and diversification and may contribute to economies of","page_number":125,"box":{"x":70,"y":75,"width":837,"height":11}},{"id":"3d9d7a2f-710a-4900-94f2-9ab91838b926","block_type":"box","text":"scale that tend to reduce the Fund’s expense ratio. BlackRock reserves the right, subject to compliance with","page_number":125,"box":{"x":69,"y":90,"width":774,"height":11}},{"id":"888d2195-40ad-4820-acf0-1b54cec75a64","block_type":"box","text":"applicable law, to redeem at any time some or all of the shares of a Fund acquired for its own accounts. A large","page_number":125,"box":{"x":69,"y":105,"width":796,"height":11}},{"id":"4fa72647-b804-4df3-ac8b-88677912f069","block_type":"box","text":"redemption of shares of a Fund by BlackRock could significantly reduce the asset size of the Fund, which might have","page_number":125,"box":{"x":69,"y":120,"width":830,"height":12}},{"id":"c06391fa-853d-4004-aa10-0333c9735d94","block_type":"box","text":"an adverse effect on the Fund’s investment flexibility, por tfolio diversification and expense ratio. 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With respect to BlackRock and its personnel, the remuneration and profitability relating to services to and","page_number":125,"box":{"x":70,"y":332,"width":805,"height":11}},{"id":"a9b103a1-c7f6-43d4-bf03-c066dad90c4f","block_type":"box","text":"sales of the Funds or other products may be greater than remuneration and profitability relating to services to and","page_number":125,"box":{"x":69,"y":347,"width":813,"height":11}},{"id":"c436d31a-3fb7-4209-8e72-2cce6e2999a4","block_type":"box","text":"sales of cer tain funds or other products that might be provided or offered. BlackRock and its sales personnel may","page_number":125,"box":{"x":69,"y":362,"width":814,"height":11}},{"id":"f74450d3-4cde-4589-a96a-3cf7c6d25d9c","block_type":"box","text":"directly or indirectly receive a por tion of the fees and commissions charged to the Funds or their shareholders.","page_number":125,"box":{"x":69,"y":377,"width":788,"height":12}},{"id":"d0a6f94f-8dbf-4de9-9b83-00a4b82ae86b","block_type":"box","text":"BlackRock and its advisory or other personnel may also benefit from increased amounts of assets under","page_number":125,"box":{"x":70,"y":392,"width":745,"height":12}},{"id":"fb1d4116-a26b-4efa-b290-a5d43590ca0e","block_type":"box","text":"management. 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BlackRock has been designated as the Fund’s valuation designee pursuant to Rule 2a-5","page_number":125,"box":{"x":68,"y":604,"width":803,"height":11}},{"id":"d99db11a-a3a9-421b-953b-d4b11c3daa62","block_type":"box","text":"under the Investment Company Act and acts through BlackRock’s Rule 2a-5 Committee (the “2a-5 Committee”), with","page_number":125,"box":{"x":69,"y":619,"width":831,"height":11}},{"id":"6a0a5856-63c3-435f-8801-5dd2192b4c7e","block_type":"box","text":"assistance from other BlackRock pricing committees and in accordance with BlackRock’s policies and procedures","page_number":125,"box":{"x":69,"y":634,"width":811,"height":12}},{"id":"0ec2ea26-ae59-4e1b-a8f5-f9c438e454c7","block_type":"box","text":"(the “Valuation Procedures”). When determining a “fair value price,” the 2a-5 Committee seeks to determine the","page_number":125,"box":{"x":69,"y":649,"width":802,"height":12}},{"id":"5e3543fe-9a4f-433c-8c70-fc83017ede27","block_type":"box","text":"price that a Fund might reasonably expect to receive from the current sale of that asset or liability in an arm’s-length","page_number":125,"box":{"x":70,"y":664,"width":829,"height":12}},{"id":"791669d7-6462-4930-9070-7209e0523a88","block_type":"box","text":"transaction. The price generally may not be determined based on what a Fund might reasonably expect to receive for","page_number":125,"box":{"x":68,"y":680,"width":832,"height":11}},{"id":"430b558d-988e-48cc-8322-0086ef3b01dd","block_type":"box","text":"selling an asset or liability at a later time or if it holds the asset or liability to maturity. While fair value determinations","page_number":125,"box":{"x":69,"y":695,"width":837,"height":11}},{"id":"27171279-882d-4ec7-838b-49ecc9ccec00","block_type":"box","text":"will be based upon all available factors that BlackRock deems relevant at the time of the determination, and may be","page_number":125,"box":{"x":68,"y":710,"width":829,"height":11}},{"id":"5fc3b12b-0eb6-4e1d-b043-3e933cd41c76","block_type":"box","text":"based on analytical values determined by BlackRock using proprietary or third par ty valuation models, fair value","page_number":125,"box":{"x":69,"y":725,"width":796,"height":11}},{"id":"e1604262-0dc1-4bac-b9f3-827df81530a7","block_type":"box","text":"represents only a good faith approximation of the value of an asset or liability. The fair value of one or more assets or","page_number":125,"box":{"x":69,"y":740,"width":839,"height":11}},{"id":"40875c0e-e674-48a7-b8ba-5d5b0ab0061d","block_type":"box","text":"liabilities may not, in retrospect, be the price at which those assets or liabilities could have been sold during the","page_number":125,"box":{"x":70,"y":755,"width":800,"height":11}},{"id":"f53b72bf-8976-4514-a6f6-ef85a0ce3691","block_type":"box","text":"period in which the par ticular fair values were used in determining a Fund’s NAV. As a result, a Fund’s sale or","page_number":125,"box":{"x":70,"y":770,"width":779,"height":12}},{"id":"70991987-3b48-4b78-a000-4815a814ab92","block_type":"box","text":"redemption of its shares at NAV, at a time when a holding or holdings are valued by the 2a-5 Committee at fair value,","page_number":125,"box":{"x":69,"y":785,"width":834,"height":12}},{"id":"cd44b661-fe86-42f7-92fd-364b46b06d02","block_type":"box","text":"may have the effect of diluting or increasing the economic interest of existing shareholders and may affect the","page_number":125,"box":{"x":69,"y":801,"width":788,"height":11}},{"id":"c091a733-30ee-4805-8b54-6e15b1f9d7bf","block_type":"box","text":"amount of revenue received by BlackRock with respect to services for which it receives an asset-based fee.","page_number":125,"box":{"x":69,"y":816,"width":765,"height":11}},{"id":"a8b4c87d-5247-4e99-b6c6-cd219211b68d","block_type":"box","text":"To the extent permitted by applicable law, a Fund may invest all or some of its shor t term cash investments in","page_number":125,"box":{"x":101,"y":838,"width":784,"height":11}},{"id":"90e6a1a7-43ed-4407-90d0-eb0bbad4942b","block_type":"box","text":"any money market fund or similarly-managed private fund advised or managed by BlackRock. In connection with any","page_number":125,"box":{"x":69,"y":853,"width":823,"height":12}},{"id":"38b9fd2b-15c9-4b64-89c3-1b44ce1449e2","block_type":"box","text":"such investments, a Fund, to the extent permitted by the Investment Company Act, may pay its share of expenses of","page_number":125,"box":{"x":69,"y":869,"width":833,"height":11}},{"id":"29004960-6cdc-42c8-9adf-ae416042a982","block_type":"box","text":"a money market fund or other similarly-managed private fund in which it invests, which may result in a Fund bearing","page_number":125,"box":{"x":69,"y":884,"width":822,"height":11}},{"id":"f66599bb-f327-4c2c-ac06-30c5186862c1","block_type":"box","text":"some additional expenses.","page_number":125,"box":{"x":69,"y":899,"width":190,"height":11}},{"id":"2a2ad3ac-b7ac-41df-9a10-41870a645ff4","block_type":"box","text":"II-94","page_number":125,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"99f7b64a-76c8-4900-89ed-3fc9760e78f2","block_type":"box","text":"NM1026U-5982568-125/232","page_number":125,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"2448d701-bd34-47a0-9626-0a4b148f7e37","block_type":"box","text":"BlackRock and its directors, officers and employees, may buy and sell securities or other investments for their","page_number":126,"box":{"x":102,"y":45,"width":787,"height":11}},{"id":"af1ad2fa-91cf-436b-acab-ca4e3c204db0","block_type":"box","text":"own accounts and may have conflicts of interest with respect to investments made on behalf of a Fund. 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To lessen the possibility that a Fund will be adversely affected by this personal trading, the Fund, BRIL and","page_number":126,"box":{"x":70,"y":105,"width":802,"height":11}},{"id":"dc7d4d35-21a9-43ae-9a31-a05ff5a5ce18","block_type":"box","text":"BlackRock each have adopted a Code of Ethics in compliance with Section 17(j) of the Investment Company Act that","page_number":126,"box":{"x":70,"y":120,"width":828,"height":11}},{"id":"97959435-02eb-41ae-a5e7-79944bace7a2","block_type":"box","text":"restricts securities trading in the personal accounts of investment professionals and others who normally come into","page_number":126,"box":{"x":69,"y":135,"width":825,"height":12}},{"id":"1a5dd74b-11a8-4826-af49-2baa22f7f758","block_type":"box","text":"possession of information regarding the Fund’s por tfolio transactions. Each Code of Ethics is also available on the","page_number":126,"box":{"x":70,"y":150,"width":816,"height":12}},{"id":"465d7054-28d8-4529-87a7-ed486e49bfbc","block_type":"box","text":"EDGAR Database on the Commission’s Internet site at http://www.sec.gov, and copies may be obtained, after paying","page_number":126,"box":{"x":70,"y":166,"width":836,"height":11}},{"id":"5555e846-119c-42e1-8462-20eba2d4a6b5","block_type":"box","text":"a duplicating fee, by e-mail at publicinfo@sec.gov.","page_number":126,"box":{"x":69,"y":181,"width":352,"height":11}},{"id":"6855c4a8-0cde-4fc1-93b6-034e40d56775","block_type":"box","text":"BlackRock will not purchase securities or other proper ty from, or sell securities or other proper ty to, a Fund,","page_number":126,"box":{"x":102,"y":203,"width":768,"height":12}},{"id":"db59b4c9-59e4-4973-a66a-a2811eabcdb3","block_type":"box","text":"except that the Fund may in accordance with rules or guidance adopted under the Investment Company Act engage in","page_number":126,"box":{"x":69,"y":219,"width":836,"height":11}},{"id":"db6a1efb-2c68-49dc-b9b5-f1c902d579de","block_type":"box","text":"transactions with another Fund or accounts that are affiliated with the Fund as a result of common officers, directors,","page_number":126,"box":{"x":68,"y":234,"width":839,"height":10}},{"id":"b2c10de9-e971-460b-8eb7-159eb0e3fb13","block_type":"box","text":"or investment advisers or pursuant to exemptive orders granted to the Funds and/or BlackRock by the Commission.","page_number":126,"box":{"x":69,"y":249,"width":824,"height":11}},{"id":"77229407-4084-4b72-b87d-2e239e15ba86","block_type":"box","text":"These transactions would be effected in circumstances in which BlackRock determined that it would be appropriate","page_number":126,"box":{"x":68,"y":264,"width":824,"height":11}},{"id":"7b807bae-b14f-43b5-a09d-91e4dc05904f","block_type":"box","text":"for the Fund to purchase and another client of BlackRock to sell, or the Fund to sell and another client of BlackRock","page_number":126,"box":{"x":68,"y":279,"width":826,"height":11}},{"id":"82b4ffa2-4dd2-47ae-987e-4820a226f583","block_type":"box","text":"to purchase, the same security or instrument on the same day. From time to time, the activities of a Fund may be","page_number":126,"box":{"x":68,"y":294,"width":810,"height":11}},{"id":"89676921-126a-48f4-9eb0-f71a879c8d93","block_type":"box","text":"restricted because of regulatory requirements applicable to BlackRock and/or BlackRock’s internal policies designed","page_number":126,"box":{"x":69,"y":309,"width":834,"height":11}},{"id":"c2397218-69e3-4f6e-b366-e4cc75cf84a0","block_type":"box","text":"to comply with, limit the applicability of, or that otherwise relate to such requirements. A client not advised by","page_number":126,"box":{"x":68,"y":324,"width":782,"height":11}},{"id":"070e0efd-4edf-4374-add8-bad6746fd826","block_type":"box","text":"BlackRock would not be subject to some of those considerations. There may be periods when BlackRock may not","page_number":126,"box":{"x":70,"y":339,"width":807,"height":12}},{"id":"a505d06c-b15b-417d-b2bb-3d1403e78a3b","block_type":"box","text":"initiate or recommend cer tain types of transactions, or may otherwise restrict or limit its advice regarding cer tain","page_number":126,"box":{"x":70,"y":355,"width":804,"height":11}},{"id":"d3856a36-9c1c-4f26-aaa8-da1f07b51c4d","block_type":"box","text":"securities or instruments issued by or related to companies for which BlackRock is per forming advisory or other","page_number":126,"box":{"x":69,"y":370,"width":799,"height":11}},{"id":"cda8f437-18ce-466c-bcfe-6fa8d7ee5846","block_type":"box","text":"services or has proprietary positions. For example, when BlackRock is engaged to provide advisory or risk","page_number":126,"box":{"x":69,"y":385,"width":755,"height":11}},{"id":"aee0d7b5-4565-4260-99e3-1dded2f1ae59","block_type":"box","text":"management services for a company, BlackRock may be prohibited from or limited in purchasing or selling securities","page_number":126,"box":{"x":69,"y":400,"width":831,"height":11}},{"id":"2ec62f9d-1f83-4d99-b46d-6a4e45213084","block_type":"box","text":"of that company on behalf of a Fund, par ticularly where such services result in BlackRock obtaining material non","page_number":126,"box":{"x":69,"y":415,"width":806,"height":11}},{"id":"40e2d1eb-88fa-4100-8bdf-e651d7331e40","block_type":"box","text":"public information about the company (","page_number":126,"box":{"x":70,"y":430,"width":276,"height":11}},{"id":"d178b9c5-7055-45ab-bb29-4bfed25ca738","block_type":"box","text":"e.g.","page_number":126,"box":{"x":348,"y":432,"width":25,"height":9}},{"id":"d4a3118c-0111-44b5-be08-30347eabd80b","block_type":"box","text":", in connection with par ticipation in a creditors’ committee). Moreover,","page_number":126,"box":{"x":376,"y":430,"width":499,"height":11}},{"id":"3f868a05-f339-43e5-9fe3-d7af15eda69a","block_type":"box","text":"applicable provisions of the Investment Company Act or other regulatory considerations may restrict a Fund or","page_number":126,"box":{"x":69,"y":445,"width":784,"height":12}},{"id":"a78afa01-4031-4046-b53a-d44a781013a4","block_type":"box","text":"BlackRock from effecting cer tain por tfolio transactions or taking other actions in respect of an investment on behalf","page_number":126,"box":{"x":70,"y":460,"width":827,"height":12}},{"id":"0da29fd6-d74e-42a2-8d8c-90054f432449","block_type":"box","text":"of a Fund, including where BlackRock and/or clients advised by BlackRock already have an interest in such issuer or","page_number":126,"box":{"x":69,"y":475,"width":830,"height":12}},{"id":"0b1efc3b-91c2-48a7-9540-750e068fb2e9","block_type":"box","text":"the investment. Similar situations could arise if personnel of BlackRock serve as directors of companies the","page_number":126,"box":{"x":68,"y":491,"width":773,"height":11}},{"id":"ce6c954f-e222-43e3-ab16-c35dd5a2de94","block_type":"box","text":"securities of which the Funds wish to purchase or sell. However, if permitted by applicable law, and where consistent","page_number":126,"box":{"x":69,"y":506,"width":832,"height":11}},{"id":"35f150d6-f5f4-40f9-b850-96f07e5c043c","block_type":"box","text":"with BlackRock’s policies and procedures (including the necessary implementation of appropriate information","page_number":126,"box":{"x":68,"y":521,"width":781,"height":11}},{"id":"0625df1d-5db0-4c71-8fea-21370403e03e","block_type":"box","text":"barriers), the Funds may purchase securities or instruments that are issued by such companies, are the subject of","page_number":126,"box":{"x":69,"y":536,"width":819,"height":11}},{"id":"8c4f5889-5c15-4c52-8ed2-315e017539e6","block_type":"box","text":"an advisory or risk management assignment by BlackRock, or where personnel of BlackRock are directors or officers","page_number":126,"box":{"x":69,"y":551,"width":832,"height":11}},{"id":"3fab0e17-b5d0-4fc1-9dcf-fa0e04a21a11","block_type":"box","text":"of the issuer.","page_number":126,"box":{"x":69,"y":566,"width":92,"height":9}},{"id":"a101f6d8-8274-44ed-baf0-3b19f920b08e","block_type":"box","text":"BlackRock has adopted and implemented policies and procedures that are designed to address potential","page_number":126,"box":{"x":102,"y":589,"width":748,"height":11}},{"id":"4781e762-e71a-40d2-821c-961bf098c021","block_type":"box","text":"conflicts that arise in connection with the advisory services BlackRock provides to Funds and other clients. Cer tain","page_number":126,"box":{"x":69,"y":604,"width":819,"height":11}},{"id":"d6329c80-5bc1-427a-b422-d6f4d13585f3","block_type":"box","text":"BlackRock advisory personnel may take views, and make decisions or recommendations, that are different than or","page_number":126,"box":{"x":70,"y":619,"width":817,"height":11}},{"id":"45fde281-7892-4f50-aa50-8c0e082663c2","block_type":"box","text":"opposite those of other BlackRock advisory personnel. Cer tain por tfolio management teams within BlackRock may","page_number":126,"box":{"x":69,"y":634,"width":818,"height":12}},{"id":"70641b3d-2d91-4d80-beac-5ac6cd7bdb6c","block_type":"box","text":"make decisions or take (or refrain from taking) actions with respect to clients they advise in a manner different than","page_number":126,"box":{"x":69,"y":649,"width":827,"height":12}},{"id":"bbd110e6-0ae2-433e-9420-d19cf0b7b079","block_type":"box","text":"or adverse to the decisions made or the actions taken (or not taken) by the Funds’ por tfolio management teams. The","page_number":126,"box":{"x":69,"y":664,"width":835,"height":12}},{"id":"d9c9bcfd-f785-4915-9417-1efd74a07809","block_type":"box","text":"various por tfolio management teams may not share information with each other, including as a result of cer tain","page_number":126,"box":{"x":68,"y":680,"width":797,"height":11}},{"id":"bf292f61-0d79-44e3-8e80-fce4dc8d4cfb","block_type":"box","text":"information barriers and other policies, and will not have any obligation or other duty to do so.","page_number":126,"box":{"x":70,"y":695,"width":667,"height":11}},{"id":"5710c4ed-7b55-4864-9c00-76499c73e51f","block_type":"box","text":"BlackRock has established cer tain information barriers and other policies to address the sharing of information","page_number":126,"box":{"x":102,"y":717,"width":794,"height":12}},{"id":"6b4c26b7-b3f6-429b-8596-b5ee14ff650d","block_type":"box","text":"between different businesses within BlackRock, including with respect to personnel responsible with managing","page_number":126,"box":{"x":69,"y":732,"width":791,"height":12}},{"id":"8479bfde-d242-46b7-9739-63dc64c97a79","block_type":"box","text":"por tfolios and voting proxies with respect to cer tain index equity por tfolios versus those responsible for managing","page_number":126,"box":{"x":70,"y":748,"width":812,"height":11}},{"id":"47cdae2b-8684-4205-acb9-c43d31e99604","block_type":"box","text":"por tfolios and voting proxies with respect to all other por tfolios. As a result of information barriers, cer tain units of","page_number":126,"box":{"x":70,"y":763,"width":818,"height":11}},{"id":"0ea7bcce-bf7f-485c-8775-d48b43c97b38","block_type":"box","text":"BlackRock generally will not have access, or will have limited access, to cer tain information and personnel, including","page_number":126,"box":{"x":70,"y":778,"width":830,"height":11}},{"id":"bb2591ed-232c-4c9e-a204-40b7a9f1ccbe","block_type":"box","text":"senior personnel, in other units of BlackRock, and generally will not manage the Funds with the benefit of information","page_number":126,"box":{"x":69,"y":793,"width":835,"height":11}},{"id":"63261c40-f394-4819-ac20-5f583a928c23","block_type":"box","text":"possessed by such other units. Therefore, BlackRock may not be able to review potential investments for the Funds","page_number":126,"box":{"x":70,"y":808,"width":824,"height":11}},{"id":"5bc5c2e3-d4fc-44b9-a1e0-f25de2f4d8a1","block_type":"box","text":"with the benefit of information held by cer tain areas of BlackRock.","page_number":126,"box":{"x":68,"y":823,"width":472,"height":11}},{"id":"47712f4d-fe1e-4fd8-9838-8f637b8d7c17","block_type":"box","text":"BlackRock may determine to move cer tain personnel, businesses, or business units from one side of an","page_number":126,"box":{"x":102,"y":846,"width":744,"height":11}},{"id":"b4d8f438-f466-4c7e-aaa2-2171efd2f110","block_type":"box","text":"information barrier to the other side of the information barrier. In connection therewith, BlackRock personnel,","page_number":126,"box":{"x":70,"y":861,"width":775,"height":11}},{"id":"4bfbcc15-f148-4266-9841-72875eb552da","block_type":"box","text":"businesses, and business units that were moved will no longer have access to the information and personnel from","page_number":126,"box":{"x":69,"y":876,"width":818,"height":11}},{"id":"c1456b6e-c428-40cb-a25f-5ff88b014065","block_type":"box","text":"the side of the information barrier from which they were moved. Information obtained in connection with such","page_number":126,"box":{"x":68,"y":891,"width":779,"height":11}},{"id":"d64e2b97-a84e-44f0-8eab-16384328fa3a","block_type":"box","text":"changes to information barriers may limit or restrict the ability of BlackRock to engage in or otherwise effect","page_number":126,"box":{"x":69,"y":906,"width":771,"height":12}},{"id":"72275c7b-b6fb-4949-992e-2fb01bb272bb","block_type":"box","text":"II-95","page_number":126,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"bb3f0933-837d-4437-8b55-72b8f0ab6cb4","block_type":"box","text":"NM1026U-5982568-126/232","page_number":126,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"667fc3e1-73cc-41c9-98b6-f4646355a4bc","block_type":"box","text":"transactions on behalf of the Funds (including purchasing or selling securities that BlackRock may otherwise have","page_number":127,"box":{"x":68,"y":45,"width":812,"height":11}},{"id":"5da7f52b-9346-4146-8bd0-5b82c2502ce0","block_type":"box","text":"purchased or sold for a client in the absence of a change to an information barrier). Information barriers may not","page_number":127,"box":{"x":70,"y":60,"width":803,"height":11}},{"id":"7346bf12-ba1b-4f2c-b3e7-a78a038ea1d7","block_type":"box","text":"have their intended impact due to, for example, changes in applicable law or inadver tent crossings of the barriers,","page_number":127,"box":{"x":69,"y":75,"width":813,"height":11}},{"id":"49e7ddf1-4897-4588-b4d1-a23fac82c957","block_type":"box","text":"and actions by personnel on one side of a barrier may impact the potential actions of personnel on the other side of","page_number":127,"box":{"x":69,"y":90,"width":829,"height":11}},{"id":"0347fee1-e99c-44d7-b35f-154a1d76ea6b","block_type":"box","text":"a barrier.","page_number":127,"box":{"x":69,"y":105,"width":62,"height":9}},{"id":"cd89e8ef-8745-4f33-a436-4aadf6d79ffd","block_type":"box","text":"Although the information barriers are intended to allow for independent por tfolio management decision-making","page_number":127,"box":{"x":101,"y":128,"width":788,"height":11}},{"id":"2e7e87a9-289e-4e78-bd73-1aadc5edbc2c","block_type":"box","text":"and proxy voting among cer tain BlackRock businesses, the investment activities of BlackRock for BlackRock clients,","page_number":127,"box":{"x":69,"y":143,"width":827,"height":11}},{"id":"1a0c95ce-11c7-40c7-b2fb-39a9fb3159ed","block_type":"box","text":"as well as BlackRock’s proprietary accounts, may nonetheless limit the investment strategies and rights of other","page_number":127,"box":{"x":69,"y":158,"width":805,"height":11}},{"id":"1cc3689e-3701-4f58-b494-43e52ed61759","block_type":"box","text":"clients (including the Fund). As BlackRock’s assets under management increases, BlackRock clients may face greater","page_number":127,"box":{"x":69,"y":173,"width":840,"height":11}},{"id":"f4cbe2c0-5577-4d8b-953d-1fac7bbc6232","block_type":"box","text":"negative impacts due to ownership restrictions and limitations imposed by laws, regulations, rules, regulators, or","page_number":127,"box":{"x":69,"y":188,"width":806,"height":12}},{"id":"82a7fc21-0a89-48a0-8e04-380a367f862a","block_type":"box","text":"issuers. For example, in cer tain circumstances where a BlackRock client invests in securities issued by companies","page_number":127,"box":{"x":70,"y":204,"width":818,"height":11}},{"id":"d138b342-2c07-4fe8-b460-8072e3ae9879","block_type":"box","text":"that operate in cer tain industries (","page_number":127,"box":{"x":68,"y":219,"width":244,"height":11}},{"id":"d1cf950a-5a9e-4cea-b4e6-b1806a6c3491","block_type":"box","text":"e.g.","page_number":127,"box":{"x":314,"y":220,"width":25,"height":10}},{"id":"5bb837c9-7607-4186-bf3b-904084818d55","block_type":"box","text":", banking, insurance, and utilities) or in cer tain emerging or international","page_number":127,"box":{"x":342,"y":219,"width":515,"height":11}},{"id":"e5e7b542-4dc3-4538-b4a5-27fdb1354b0d","block_type":"box","text":"markets, or are subject to regulatory or corporate ownership restrictions (","page_number":127,"box":{"x":69,"y":234,"width":523,"height":11}},{"id":"e0fa318f-9a9d-4937-9f80-6902e87671f4","block_type":"box","text":"e.g.","page_number":127,"box":{"x":594,"y":235,"width":25,"height":10}},{"id":"3d168be4-0524-4d2a-9b84-29057cd458cd","block_type":"box","text":", with mechanisms such as poison pills","page_number":127,"box":{"x":621,"y":234,"width":280,"height":11}},{"id":"43c23d56-27f2-4b44-a28b-48e75fb47d2a","block_type":"box","text":"in place to prevent takeovers), or where a BlackRock client invests in cer tain futures and derivatives, there may be","page_number":127,"box":{"x":70,"y":249,"width":816,"height":11}},{"id":"07e47134-6924-4b6d-9587-37680e50b819","block_type":"box","text":"limits on the aggregate amount invested by BlackRock for its clients and BlackRock’s proprietary accounts that may","page_number":127,"box":{"x":70,"y":264,"width":825,"height":11}},{"id":"9f0afd0e-ea47-41a4-90cb-a9e23e5e4134","block_type":"box","text":"not be exceeded without the grant of a license or other regulatory or corporate approval, order, consent, relief, waiver","page_number":127,"box":{"x":69,"y":279,"width":837,"height":11}},{"id":"c32bafba-7d1b-4d08-9998-74375451dfc5","block_type":"box","text":"or non-disapproval or, if exceeded, may cause BlackRock or its clients to be subject to enforcement actions,","page_number":127,"box":{"x":69,"y":294,"width":769,"height":11}},{"id":"5bd789a2-c410-4f14-a572-cae35acedfc9","block_type":"box","text":"disgorgement of share ownership or profits, regulatory restrictions, complex compliance repor ting, increased","page_number":127,"box":{"x":69,"y":309,"width":775,"height":11}},{"id":"5e91d844-ab0d-4d5c-8cd5-bdfd371e4505","block_type":"box","text":"compliance costs or suffer disadvantages or business restrictions. In light of cer tain restrictions, BlackRock may also","page_number":127,"box":{"x":69,"y":324,"width":839,"height":12}},{"id":"717235c8-f9dd-4fae-93f4-d33723e91fe9","block_type":"box","text":"seek to make indirect investments (","page_number":127,"box":{"x":69,"y":340,"width":255,"height":10}},{"id":"c877774d-bcf2-43a9-b598-136e4889e8a9","block_type":"box","text":"e.g.","page_number":127,"box":{"x":326,"y":341,"width":24,"height":10}},{"id":"2c435ab1-25bd-44b7-bd08-c5854f32fa16","block_type":"box","text":", using derivatives) on behalf of its clients to receive exposure to cer tain","page_number":127,"box":{"x":353,"y":339,"width":514,"height":12}},{"id":"11985314-ca2a-413f-a534-d912ad7f3965","block_type":"box","text":"securities in excess of the applicable ownership restrictions and limitations when legally permitted that will expose","page_number":127,"box":{"x":69,"y":355,"width":817,"height":11}},{"id":"2ec59efb-c68c-4383-b579-0ea74a5fb2ce","block_type":"box","text":"such clients to additional costs and additional risks, including any risks associated with investing in derivatives.","page_number":127,"box":{"x":69,"y":370,"width":795,"height":11}},{"id":"c944f6ca-66a3-427e-a5d2-1c81ac9c48f7","block_type":"box","text":"There may be limited availability of derivatives that provide indirect exposure to an impacted security. BlackRock","page_number":127,"box":{"x":68,"y":385,"width":799,"height":11}},{"id":"c7b05d0b-d752-4585-a8b6-206cd8fe753c","block_type":"box","text":"clients can be subject to more than one ownership limitation depending on each client’s holdings, and each","page_number":127,"box":{"x":69,"y":400,"width":767,"height":11}},{"id":"1391bdee-e382-40be-ac9f-3fba99214c5d","block_type":"box","text":"ownership limitation can impact multiple securities held by the client. Cer tain clients or shareholders may have their","page_number":127,"box":{"x":69,"y":415,"width":829,"height":11}},{"id":"e1b69c67-95bb-4cca-9762-8c700bcbeaf8","block_type":"box","text":"own overlapping obligations to monitor their compliance with ownership limitations across their investments.","page_number":127,"box":{"x":69,"y":430,"width":772,"height":11}},{"id":"a1efde67-c2b0-4f54-9e1b-dc6d296bf2ba","block_type":"box","text":"If cer tain aggregate ownership thresholds are reached either through the actions of BlackRock or a BlackRock","page_number":127,"box":{"x":102,"y":453,"width":783,"height":11}},{"id":"e5b35108-2ad3-4160-a3e4-9a8e1a94101f","block_type":"box","text":"client or as a result of corporate actions by the issuer, the ability of BlackRock on behalf of clients to purchase or","page_number":127,"box":{"x":69,"y":468,"width":808,"height":11}},{"id":"8276caef-4aa2-4a72-a20f-98cdbabd7cd8","block_type":"box","text":"dispose of investments, or exercise rights (including voting) or under take business transactions, may be restricted by","page_number":127,"box":{"x":69,"y":483,"width":837,"height":11}},{"id":"bbb26286-d561-4344-971a-b22975a69b09","block_type":"box","text":"law, regulation, rule, or organizational documents or otherwise impaired. For example, to meet the requirements of","page_number":127,"box":{"x":70,"y":498,"width":818,"height":11}},{"id":"ad8c7b45-ea8c-438f-b76a-d0f9eac763bf","block_type":"box","text":"an ownership limitation or restriction, a client may be unable to purchase or directly hold a security the client would","page_number":127,"box":{"x":69,"y":514,"width":821,"height":10}},{"id":"3c6a2d17-ef16-4596-a206-41e713b65158","block_type":"box","text":"otherwise purchase or hold. The limitation or restriction may be based on the holdings of other BlackRock clients","page_number":127,"box":{"x":69,"y":528,"width":806,"height":12}},{"id":"12f9fadc-0a82-4074-8047-593be30163a2","block_type":"box","text":"instead of the specific client being restricted. For index funds, this means a fund may not be able to track its index as","page_number":127,"box":{"x":70,"y":543,"width":839,"height":12}},{"id":"1d842ccd-4408-4247-a2de-5e398e2af683","block_type":"box","text":"closely as it would if it was not subject to an ownership limitation or restriction because the fund cannot acquire the","page_number":127,"box":{"x":69,"y":559,"width":826,"height":11}},{"id":"79ed5af0-2ed1-49e9-92aa-e2544381030f","block_type":"box","text":"amount of the impacted security included in its index. BlackRock on behalf of its clients may limit purchases, sell","page_number":127,"box":{"x":69,"y":574,"width":807,"height":11}},{"id":"532abd00-93d1-4722-bc77-00cc36856ba2","block_type":"box","text":"existing investments, utilize indirect investments, utilize information barriers, or otherwise restrict, forgo, or limit the","page_number":127,"box":{"x":69,"y":589,"width":830,"height":11}},{"id":"48846883-3e6b-4cdc-b60e-9efc891b8ccb","block_type":"box","text":"exercise of rights (including transferring, outsourcing, or limiting voting rights or forgoing the right to receive","page_number":127,"box":{"x":69,"y":604,"width":765,"height":11}},{"id":"489780ed-bb51-4ed9-99fc-9049b18e33ce","block_type":"box","text":"dividends) when BlackRock, in its sole discretion, deems it appropriate in light of potential regulatory or other","page_number":127,"box":{"x":69,"y":619,"width":781,"height":11}},{"id":"e02d85dd-b43b-4cb5-b755-89ec880d40d9","block_type":"box","text":"restrictions on ownership or other consequences resulting from reaching investment thresholds. These types of","page_number":127,"box":{"x":69,"y":634,"width":796,"height":12}},{"id":"61efc85d-2a29-4ebc-bd03-e8c54e236183","block_type":"box","text":"restrictions could negatively impact a client’s per formance or ability to meet its investment objective.","page_number":127,"box":{"x":69,"y":649,"width":720,"height":12}},{"id":"a9804af1-6476-4f21-b473-1b403fa373dc","block_type":"box","text":"When BlackRock or a BlackRock client is subject to an ownership limitation, BlackRock may in its discretion seek","page_number":127,"box":{"x":101,"y":672,"width":807,"height":11}},{"id":"1cb48a7c-0653-4159-adee-ee1490f13a87","block_type":"box","text":"permission from the applicable issuers or regulators to exceed the limitation. However, there is no guarantee that","page_number":127,"box":{"x":70,"y":687,"width":810,"height":11}},{"id":"69410824-2207-4be9-aacf-fdb5822c5749","block_type":"box","text":"permission will be granted, or that, once granted, it will not be modified or revoked at a later date with minimal or no","page_number":127,"box":{"x":70,"y":702,"width":829,"height":12}},{"id":"f392db08-6ecb-4753-a7fc-2d3c48fa905b","block_type":"box","text":"notice. The issuer and/or regulator may also require that BlackRock on behalf of itself and its clients take or refrain","page_number":127,"box":{"x":69,"y":717,"width":824,"height":12}},{"id":"4a883951-9564-4936-981a-4593dc1982c1","block_type":"box","text":"from taking cer tain actions in connection with the approval, order, consent, relief or non-disapproval, which BlackRock","page_number":127,"box":{"x":68,"y":732,"width":841,"height":12}},{"id":"b03e25f6-2f95-499e-859d-db7ab3fe8ca0","block_type":"box","text":"may accept if it believes the benefits outweigh the costs and may limit BlackRock from taking actions that it","page_number":127,"box":{"x":69,"y":748,"width":770,"height":11}},{"id":"4219489d-6aeb-4605-a3ae-604d96adfc81","block_type":"box","text":"otherwise would take. In those circumstances where ownership thresholds or limitations must be observed,","page_number":127,"box":{"x":69,"y":763,"width":769,"height":11}},{"id":"40f4c71e-b6d9-4d12-afec-5c8e831bb63e","block_type":"box","text":"BlackRock seeks to allocate limited investment oppor tunities equitably among clients, taking into consideration","page_number":127,"box":{"x":70,"y":778,"width":794,"height":11}},{"id":"8f0a0918-5798-4e3d-a2b6-f525cec3ac50","block_type":"box","text":"benchmark weight and investment strategy. BlackRock may adopt cer tain controls designed to prevent the","page_number":127,"box":{"x":69,"y":793,"width":757,"height":11}},{"id":"3381bf5a-e007-4d12-bc00-c18de1456da8","block_type":"box","text":"occurrence of a breach of any applicable ownership threshold or limits, including, for example, when ownership in","page_number":127,"box":{"x":69,"y":808,"width":807,"height":11}},{"id":"876ec52a-3418-43eb-8a35-4d0acf6166d1","block_type":"box","text":"cer tain securities nears an applicable threshold, BlackRock may limit additional purchases in such securities or, with","page_number":127,"box":{"x":69,"y":823,"width":833,"height":11}},{"id":"ae6efc42-3277-4c1c-b274-59715fc80e0e","block_type":"box","text":"respect to ETFs, remove such securities from the list of Deposit Securities to be delivered to the Fund in connection","page_number":127,"box":{"x":69,"y":838,"width":827,"height":11}},{"id":"5b435c87-304f-419d-b1ef-dc215ea60f32","block_type":"box","text":"with purchases of Creation Units of such Fund. If client holdings of an issuer exceed an applicable threshold and","page_number":127,"box":{"x":68,"y":853,"width":803,"height":12}},{"id":"4c699039-4bf2-49af-94bb-874ae148f672","block_type":"box","text":"BlackRock is unable to obtain relief to enable the continued holding of such investments, it may be necessary to","page_number":127,"box":{"x":70,"y":869,"width":802,"height":11}},{"id":"e6692b8f-b11d-447b-9f83-12ae405b55a4","block_type":"box","text":"reduce these positions to meet the applicable limitations and BlackRock or such client may be subject to regulatory","page_number":127,"box":{"x":69,"y":884,"width":826,"height":11}},{"id":"66f8f322-4386-4931-8131-9768f416fcd6","block_type":"box","text":"actions. In these cases, the investments will be sold in a manner that BlackRock deems fair and equitable over time.","page_number":127,"box":{"x":69,"y":899,"width":834,"height":11}},{"id":"55492d9e-4a00-4018-aa56-d96dec9c4a54","block_type":"box","text":"II-96","page_number":127,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"8da28cc9-1b96-4dbd-9bcb-3fa33686948f","block_type":"box","text":"NM1026U-5982568-127/232","page_number":127,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"0b525b35-55a7-4e3c-a385-0b3e951b2be0","block_type":"box","text":"Ownership limitations are highly complex. It is possible that, despite BlackRock’s intent to either comply with or","page_number":128,"box":{"x":102,"y":45,"width":795,"height":11}},{"id":"6c038bcf-4af6-4a01-adb9-2f91b39156b2","block_type":"box","text":"be granted permission to exceed ownership limitations, it may inadver tently breach a limit or violate the corporate or","page_number":128,"box":{"x":69,"y":60,"width":831,"height":11}},{"id":"7ef83374-1ac9-4c7c-a2af-5e9e77008990","block_type":"box","text":"regulatory approval, order, consent, relief or non-disapproval that was obtained.","page_number":128,"box":{"x":69,"y":75,"width":566,"height":11}},{"id":"db537b45-ad04-4144-9818-22e3e05632cd","block_type":"box","text":"In addition to the foregoing, other ownership thresholds may trigger repor ting requirements to governmental and","page_number":128,"box":{"x":102,"y":98,"width":798,"height":11}},{"id":"c411d024-0226-4d02-91d4-3a7aefe9f22a","block_type":"box","text":"regulatory authorities, and such repor ts may entail the disclosure of the identity of a client or BlackRock’s intended","page_number":128,"box":{"x":69,"y":113,"width":823,"height":11}},{"id":"120b3f21-4baf-4e8a-8085-1bd851238168","block_type":"box","text":"strategy with respect to such security or asset.","page_number":128,"box":{"x":69,"y":128,"width":333,"height":11}},{"id":"3903376c-2596-4635-a3da-a3fab078583e","block_type":"box","text":"BlackRock may maintain securities indices. 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In instances where BlackRock charges a unitary management fee, BlackRock may have a","page_number":128,"box":{"x":70,"y":211,"width":788,"height":11}},{"id":"41c2fb88-57ea-4800-bb0c-2a82ceebe1db","block_type":"box","text":"financial incentive to use a BlackRock index that is less costly to BlackRock than a third par ty index. BlackRock may","page_number":128,"box":{"x":68,"y":226,"width":829,"height":11}},{"id":"7e657237-1311-495a-8667-3518b6b4aca6","block_type":"box","text":"benefit from the Funds using BlackRock indices by creating increasing acceptance in the marketplace for such","page_number":128,"box":{"x":69,"y":241,"width":784,"height":11}},{"id":"1f184b30-f485-48d9-a03e-0c5178fc99e5","block_type":"box","text":"indices. BlackRock is not obligated to license its indices to a Fund and the Funds are under no obligation to use","page_number":128,"box":{"x":70,"y":257,"width":797,"height":11}},{"id":"f91e76a4-23e6-4668-91bd-5abc8c0e6f13","block_type":"box","text":"BlackRock indices. Any Fund that enters into a license for a BlackRock index cannot be assured that the terms of any","page_number":128,"box":{"x":70,"y":271,"width":837,"height":12}},{"id":"cb16127a-021e-44d0-b4b9-2c76b313790b","block_type":"box","text":"index licensing agreement with BlackRock will be as favorable as those terms offered to other licensees.","page_number":128,"box":{"x":70,"y":286,"width":746,"height":12}},{"id":"99d81945-7411-4ab6-87d0-1185e1641adb","block_type":"box","text":"BlackRock may enter into contractual arrangements with third-par ty service providers to a Fund (","page_number":128,"box":{"x":102,"y":309,"width":686,"height":11}},{"id":"0133d9a2-7415-4e71-8e85-a44e37a83146","block_type":"box","text":"e.g.","page_number":128,"box":{"x":790,"y":311,"width":25,"height":9}},{"id":"f2460576-041d-4737-9d88-5559cfece7c0","block_type":"box","text":", custodians,","page_number":128,"box":{"x":817,"y":309,"width":90,"height":11}},{"id":"15622b5f-9917-45c7-9cdd-750d66ad32b7","block_type":"box","text":"administrators and index providers) pursuant to which BlackRock receives fee discounts or concessions in","page_number":128,"box":{"x":69,"y":324,"width":756,"height":11}},{"id":"ae46c119-357d-45fc-b90c-620a100447c3","block_type":"box","text":"recognition of BlackRock’s overall relationship with such service providers. BlackRock may also enter into contractual","page_number":128,"box":{"x":69,"y":339,"width":836,"height":12}},{"id":"aa2057e7-bbff-40ba-9f31-98dd13cc2ea8","block_type":"box","text":"arrangements with such service providers pursuant to which BlackRock incurs additional costs if the service","page_number":128,"box":{"x":69,"y":355,"width":772,"height":11}},{"id":"aa769ae9-435e-4a21-b2d4-5dc7965064d8","block_type":"box","text":"provider’s services are terminated with respect to a Fund. To the extent that BlackRock is responsible for paying","page_number":128,"box":{"x":70,"y":370,"width":800,"height":11}},{"id":"e23b1ad5-78b0-4c0f-98e7-6420ea30eb97","block_type":"box","text":"service providers out of its fees that it receives from the Funds, the benefits of lower fees, including any fee","page_number":128,"box":{"x":69,"y":385,"width":771,"height":11}},{"id":"11b54a90-b9f1-4348-8b7e-69932e66c91d","block_type":"box","text":"discounts or concessions, or any additional savings, may accrue, in whole or in par t, to BlackRock, which could result","page_number":128,"box":{"x":69,"y":400,"width":839,"height":11}},{"id":"d1d3c503-2967-4d91-bfd6-25104d3bccca","block_type":"box","text":"in conflicts of interest relating to the use or termination of service providers to a Fund. In addition, conflicts of","page_number":128,"box":{"x":70,"y":415,"width":785,"height":11}},{"id":"1439ca44-ba35-48b0-a0cb-54489c7e4ffe","block_type":"box","text":"interest may arise with respect to contractual arrangements with third-par ty service providers to a Fund, or the","page_number":128,"box":{"x":70,"y":430,"width":786,"height":11}},{"id":"11b026e3-da72-4031-a6e9-7f5aa53c77e9","block_type":"box","text":"selection of such providers, par ticularly in circumstances where BlackRock is negotiating on behalf of both funds that","page_number":128,"box":{"x":69,"y":445,"width":837,"height":12}},{"id":"6e20934e-e77d-448b-a12e-1d7f6563ee4e","block_type":"box","text":"have a unitary management fee and those that do not or different service providers have different fee structures.","page_number":128,"box":{"x":69,"y":460,"width":809,"height":12}},{"id":"40dbec79-c108-473a-8e07-942a66225f32","block_type":"box","text":"Conflicts of interest may arise as a result of simultaneous investment management of multiple client accounts","page_number":128,"box":{"x":102,"y":483,"width":788,"height":11}},{"id":"30267662-0419-4666-9510-66264b54f0e3","block_type":"box","text":"by BlackRock’s investment professionals. For example, differences in the advisory fee structure may create the","page_number":128,"box":{"x":69,"y":498,"width":795,"height":11}},{"id":"e8263fad-9b34-481f-b2f1-c51a785eed6d","block_type":"box","text":"appearance of actual or potential conflicts of interest because such differences could create pecuniary incentives for","page_number":128,"box":{"x":69,"y":513,"width":835,"height":11}},{"id":"40fd181d-7585-4c73-be34-df84d1fd11fe","block_type":"box","text":"BlackRock to favor one client account over another.","page_number":128,"box":{"x":70,"y":528,"width":363,"height":9}},{"id":"b612f127-19d6-4386-b5a3-662d71b22e4f","block_type":"box","text":"BlackRock owns or has an ownership interest in cer tain trading, por tfolio management, operations and/or","page_number":128,"box":{"x":102,"y":551,"width":757,"height":11}},{"id":"dc674d2d-9655-4737-8666-9a77f3a15935","block_type":"box","text":"information systems used by Fund service providers. These systems are, or will be, used by a Fund service provider","page_number":128,"box":{"x":70,"y":566,"width":826,"height":11}},{"id":"4dd359ed-dbc4-4ba1-8cb1-208e4ede1ee3","block_type":"box","text":"in connection with the provision of services to accounts managed by BlackRock and funds managed and sponsored","page_number":128,"box":{"x":70,"y":581,"width":822,"height":12}},{"id":"de2ab823-4e3f-4f99-9be8-63ba92f69ce4","block_type":"box","text":"by BlackRock, including the Funds, that engage the service provider (typically the custodian). A Fund’s service","page_number":128,"box":{"x":69,"y":597,"width":782,"height":11}},{"id":"765586f6-eb28-45d0-9ec8-5a378a10c98e","block_type":"box","text":"provider remunerates BlackRock for the use of the systems. A Fund service provider’s payments to BlackRock for the","page_number":128,"box":{"x":70,"y":612,"width":835,"height":11}},{"id":"55a2f5c5-6f80-4b6d-8a5c-08e23e4b1087","block_type":"box","text":"use of these systems may enhance the profitability of BlackRock.","page_number":128,"box":{"x":69,"y":627,"width":465,"height":11}},{"id":"7b52c2c8-8aef-464c-8227-1d49c367f32a","block_type":"box","text":"BlackRock’s receipt of fees from a service provider in connection with the use of systems provided by BlackRock","page_number":128,"box":{"x":102,"y":649,"width":804,"height":12}},{"id":"ffad5578-e305-476c-a672-95dc0a3f7181","block_type":"box","text":"may create an incentive for BlackRock to recommend that a Fund enter into or renew an arrangement with the service","page_number":128,"box":{"x":69,"y":664,"width":840,"height":12}},{"id":"2f440216-d47a-46fb-bdb7-b98d059af637","block_type":"box","text":"provider.","page_number":128,"box":{"x":70,"y":680,"width":58,"height":11}},{"id":"907cf34d-936f-4232-8662-c2a3b9be809b","block_type":"box","text":"In recognition of a BlackRock client’s overall relationship with BlackRock, BlackRock may offer special pricing","page_number":128,"box":{"x":102,"y":702,"width":778,"height":12}},{"id":"fa1f0c76-d1e1-4d27-ae85-d7c02a81617f","block_type":"box","text":"arrangements for cer tain services provided by BlackRock. Any such special pricing arrangements will not affect Fund","page_number":128,"box":{"x":69,"y":717,"width":831,"height":12}},{"id":"60d2c723-a04e-4462-b956-c738a7d278c0","block_type":"box","text":"fees and expenses applicable to such client’s investment in a Fund.","page_number":128,"box":{"x":68,"y":732,"width":485,"height":11}},{"id":"51722c73-f497-4a2f-a5ae-e934d89b9bcd","block_type":"box","text":"Present and future activities of BlackRock and its directors, officers and employees, in addition to those","page_number":128,"box":{"x":102,"y":755,"width":742,"height":11}},{"id":"efb05986-399b-43e8-a835-ec783121c07b","block_type":"box","text":"described in this section, may give rise to additional conflicts of interest.","page_number":128,"box":{"x":69,"y":770,"width":517,"height":12}},{"id":"3b09c9f6-0b52-40e1-8674-0373c1cbab47","block_type":"box","text":"PURCHASE OF SHARES","page_number":128,"box":{"x":395,"y":800,"width":188,"height":10}},{"id":"239379fb-6153-40f6-8d5d-cc3be91d71ae","block_type":"box","text":"Most BlackRock-advised open-end funds offer multiple classes of shares under a plan adopted under Rule 18f-3","page_number":128,"box":{"x":102,"y":823,"width":800,"height":11}},{"id":"876eed31-4c22-4e58-a7b1-0a43266e4fb2","block_type":"box","text":"under the Investment Company Act. Investor A Shares are sold to investors choosing the initial sales charge","page_number":128,"box":{"x":69,"y":838,"width":771,"height":11}},{"id":"7d3eb76f-04e2-4698-a4dc-89889847281a","block_type":"box","text":"alternative, except that Investor A Shares of Index Funds (defined below) and BlackRock Shor t Obligations Fund are","page_number":128,"box":{"x":69,"y":853,"width":822,"height":11}},{"id":"d5220609-0998-4a56-adf3-b2c963286d81","block_type":"box","text":"generally not subject to an initial sales charge, and Investor C Shares are sold to investors choosing the deferred","page_number":128,"box":{"x":68,"y":868,"width":809,"height":11}},{"id":"cf6b9117-c00a-4b7c-ab6e-4a11772bec2a","block_type":"box","text":"sales charge alternative. Investor P Shares are available only to cer tain investors purchasing shares of Funds","page_number":128,"box":{"x":69,"y":883,"width":781,"height":11}},{"id":"7b41a1a8-d6b6-44d8-a742-e80dd5fd6f0c","block_type":"box","text":"through registered representatives of an insurance company’s broker-dealer that has entered into an agreement with","page_number":128,"box":{"x":68,"y":898,"width":833,"height":11}},{"id":"4570daee-9360-44c4-ac0d-5f32698f5a16","block_type":"box","text":"II-97","page_number":128,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"6377487d-a95e-4ed4-b081-945ed24dbe87","block_type":"box","text":"NM1026U-5982568-128/232","page_number":128,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"f9ce6046-cee1-4ab1-bae6-ce6879ccd9ee","block_type":"box","text":"the Distributor to offer such shares. Institutional Shares are sold to cer tain eligible investors without a sales charge.","page_number":129,"box":{"x":68,"y":45,"width":833,"height":11}},{"id":"8c0761cc-e931-47da-af00-5e8b407ac09d","block_type":"box","text":"Cer tain Funds offer Class R Shares, which are available only to cer tain employer-sponsored retirement plans and are","page_number":129,"box":{"x":69,"y":60,"width":835,"height":11}},{"id":"2c16a665-1083-4131-896e-a990ca41d0fe","block_type":"box","text":"sold without a sales charge. Cer tain Funds offer Class G Shares, which are available only to investors on eligible","page_number":129,"box":{"x":69,"y":75,"width":804,"height":11}},{"id":"89678d29-2e99-462d-a08e-cb0230be9539","block_type":"box","text":"platforms, which are platforms where clients invest in the Fund through a single omnibus account in the name of a","page_number":129,"box":{"x":70,"y":90,"width":816,"height":11}},{"id":"9cf87b28-0ab2-4d6c-b596-f8fdf5f641c9","block_type":"box","text":"financial intermediary that meets an initial investment minimum of $2 billion. In addition, cer tain Funds offer Service","page_number":129,"box":{"x":68,"y":104,"width":835,"height":12}},{"id":"86bfe2a1-b85f-400a-88fa-145fcb59c60d","block_type":"box","text":"Shares, BlackRock Shares and/or Class K Shares that are available only to cer tain eligible investors. Please see the","page_number":129,"box":{"x":69,"y":120,"width":834,"height":12}},{"id":"fa5a6077-1adb-4805-8805-d7fa5f20c9c5","block_type":"box","text":"appropriate Prospectus for your Fund to determine which classes are offered by your Fund and under what","page_number":129,"box":{"x":69,"y":135,"width":757,"height":11}},{"id":"0e715b81-d496-45e4-b322-db07b754f706","block_type":"box","text":"circumstances. Each class has different exchange privileges. See “Shareholder Services — Exchange Privilege.”","page_number":129,"box":{"x":69,"y":150,"width":802,"height":12}},{"id":"48e408b5-a79b-4fa3-a5ef-77b584236fb6","block_type":"box","text":"The applicable offering price for purchase orders is based on the NAV of a Fund next determined after receipt of","page_number":129,"box":{"x":101,"y":173,"width":799,"height":11}},{"id":"6b61516a-353e-4f47-8b24-b78bc39f4843","block_type":"box","text":"the purchase order by a dealer or other financial intermediary (“Selling Dealer”) that has been authorized by the","page_number":129,"box":{"x":68,"y":188,"width":798,"height":12}},{"id":"80607f72-6fdf-4743-9b61-db10b4fa91d0","block_type":"box","text":"Distributor by contract to accept such orders. In addition, with respect to the affiliated underlying funds in which","page_number":129,"box":{"x":70,"y":203,"width":795,"height":12}},{"id":"9cef0e63-881e-4ea8-b1b2-3e115f01b779","block_type":"box","text":"target date funds advised by BlackRock or its affiliates (“BlackRock Target Date Funds”) invest, the applicable","page_number":129,"box":{"x":68,"y":218,"width":786,"height":12}},{"id":"0566e0c3-0dcb-4d68-a110-de26eaddb22f","block_type":"box","text":"offering price of each affiliated underlying fund is based on the NAV of such affiliated underlying fund next determined","page_number":129,"box":{"x":69,"y":234,"width":839,"height":11}},{"id":"14bcec8d-9c06-4961-9b2d-16a223430d97","block_type":"box","text":"after a purchase order is received, or deemed to be received upon receipt by a Selling Dealer, by the BlackRock","page_number":129,"box":{"x":69,"y":249,"width":795,"height":11}},{"id":"a2bb01b5-36ca-4bbc-a7a7-0886be9542d0","block_type":"box","text":"Target Date Funds that allocate a por tion of such purchase order to such affiliated underlying fund. As to purchase","page_number":129,"box":{"x":68,"y":264,"width":819,"height":11}},{"id":"a566d28f-d9eb-40d0-8ec1-4ad24f740daf","block_type":"box","text":"orders received by Selling Dealers or BlackRock Target Date Funds prior to the close of business on the New York","page_number":129,"box":{"x":69,"y":279,"width":808,"height":11}},{"id":"241ac1df-4139-4635-9005-c8346e0f3328","block_type":"box","text":"Stock Exchange (“NYSE”) (generally, the NYSE closes at 4:00 p.m. Eastern time), on the day the order is placed,","page_number":129,"box":{"x":69,"y":294,"width":803,"height":11}},{"id":"31e25928-1068-4831-adc2-2ece6ab0e49f","block_type":"box","text":"including orders received after the close of business on the previous day, the applicable offering price is based on","page_number":129,"box":{"x":70,"y":309,"width":812,"height":11}},{"id":"71e11aa8-c76a-4f9e-9def-f14d1af95767","block_type":"box","text":"the NAV determined as of the close of business on the NYSE on that day. If the purchase orders are not received by","page_number":129,"box":{"x":68,"y":324,"width":828,"height":11}},{"id":"f131ce34-9fad-4e3d-a7e0-df35c9d0b34c","block_type":"box","text":"the Selling Dealer or a BlackRock Target Date Fund before the close of business on the NYSE, such orders are","page_number":129,"box":{"x":68,"y":339,"width":788,"height":12}},{"id":"0e5f44fa-6268-488b-bb7f-dee0b6f013e5","block_type":"box","text":"deemed received on the next business day. It is the responsibility of brokers to transmit purchase orders and","page_number":129,"box":{"x":69,"y":355,"width":779,"height":11}},{"id":"b9daccfb-7a70-4f90-9843-3496f4aeb3a9","block_type":"box","text":"payment on a timely basis. Generally, if payment is not received within the period described in the Prospectuses, the","page_number":129,"box":{"x":70,"y":370,"width":830,"height":11}},{"id":"0f07cb6e-a083-4c5f-9c68-c10b02325d8e","block_type":"box","text":"order will be canceled, notice thereof will be given, and the broker and its customers will be responsible for any loss","page_number":129,"box":{"x":69,"y":385,"width":828,"height":11}},{"id":"ba2d64e3-dde7-4e3c-8cf4-2528ddb18d68","block_type":"box","text":"to the Fund or its shareholders. Orders of less than $500 may be mailed by a broker to the Transfer Agent.","page_number":129,"box":{"x":68,"y":399,"width":762,"height":12}},{"id":"f7b8dd95-5ab1-404d-969a-74185b5685fc","block_type":"box","text":"The minimum investment for the initial purchase of shares is set for th in the Prospectus for each Fund. The","page_number":129,"box":{"x":101,"y":423,"width":768,"height":11}},{"id":"29eda939-2e78-4fb9-8c78-4f9cb2b877b7","block_type":"box","text":"minimum initial investment for employees of a Fund, a Fund’s Manager, Sub-Advisers or BRIL or employees of their","page_number":129,"box":{"x":69,"y":438,"width":819,"height":11}},{"id":"fe78a126-a980-4d6c-8ca6-e0d45027f115","block_type":"box","text":"affiliates is $100, unless payment is made through a payroll deduction program in which case the minimum","page_number":129,"box":{"x":69,"y":452,"width":769,"height":12}},{"id":"85138064-f3f7-4761-b553-21814c99f758","block_type":"box","text":"investment is $25.","page_number":129,"box":{"x":70,"y":467,"width":132,"height":11}},{"id":"461da77f-7840-4b25-b1d6-483607111abf","block_type":"box","text":"Each Fund has lower investment minimums for other categories of shareholders eligible to purchase Institutional","page_number":129,"box":{"x":102,"y":491,"width":802,"height":11}},{"id":"682f685d-cda0-42c5-a3bc-29f54ffa31b3","block_type":"box","text":"Shares, including selected fee-based programs. Each Fund may permit a lower initial investment for cer tain investors","page_number":129,"box":{"x":69,"y":506,"width":833,"height":11}},{"id":"f87a8811-23e6-4bad-8b57-a1cc618c2218","block_type":"box","text":"if their purchase, combined with purchases by other investors received together by the Fund, meets the minimum","page_number":129,"box":{"x":70,"y":521,"width":806,"height":11}},{"id":"83b6221d-0f89-4ed3-87a4-2483a1fa7a2c","block_type":"box","text":"investment requirement. Each Fund may reject any purchase order, modify or waive the minimum initial or","page_number":129,"box":{"x":70,"y":536,"width":751,"height":11}},{"id":"5fe33ba7-10f0-407c-89e9-370ef84965cb","block_type":"box","text":"subsequent investment requirements and suspend and resume the sale of any share class of any Fund at any time.","page_number":129,"box":{"x":69,"y":551,"width":826,"height":11}},{"id":"fbd9c6a3-516d-4631-b64e-3f6fea086341","block_type":"box","text":"Financial intermediaries may, in connection with a change in account type or otherwise in accordance with a","page_number":129,"box":{"x":102,"y":574,"width":768,"height":11}},{"id":"d9e9b309-36d7-4c23-bea8-2e151e7387f4","block_type":"box","text":"financial intermediary’s policies and procedures, exchange shares of a Fund from one class of shares to another","page_number":129,"box":{"x":68,"y":589,"width":807,"height":11}},{"id":"99058f6a-c530-48d1-a8cb-c7adfad3efaa","block_type":"box","text":"class of shares of the same Fund, provided that the exchanged shares are not subject to a contingent deferred sales","page_number":129,"box":{"x":69,"y":604,"width":836,"height":11}},{"id":"beb6d2fe-7036-4072-8927-960d34db4cf1","block_type":"box","text":"charge (“CDSC”) and that shareholders meet eligibility requirements of the new share class. Please speak to your","page_number":129,"box":{"x":69,"y":619,"width":814,"height":11}},{"id":"65c31d7b-c5ed-412f-a446-93ca9988c73a","block_type":"box","text":"financial intermediary for information about specific policies and procedures applicable to your account.","page_number":129,"box":{"x":68,"y":634,"width":740,"height":11}},{"id":"ce6bcbff-259d-493e-a9db-b3dd1e82126c","block_type":"box","text":"Each Fund or the Distributor may suspend the continuous offering of the Fund’s shares of any class at any time","page_number":129,"box":{"x":102,"y":657,"width":795,"height":11}},{"id":"f620c4d2-83e2-4a49-9102-ac68fd7a70e1","block_type":"box","text":"in response to conditions in the securities markets or otherwise and may resume offering the shares from time to","page_number":129,"box":{"x":70,"y":672,"width":813,"height":11}},{"id":"318f6b59-05e6-4de9-8c3b-f5c8e976263f","block_type":"box","text":"time. Any order may be rejected by a Fund or the Distributor. Neither the Distributor, the securities dealers nor other","page_number":129,"box":{"x":68,"y":687,"width":827,"height":11}},{"id":"abad1be3-e47a-4374-b81e-4ad7818a20ed","block_type":"box","text":"financial intermediaries are permitted to withhold placing orders to benefit themselves by a price change.","page_number":129,"box":{"x":68,"y":702,"width":750,"height":12}},{"id":"230a99b6-c0db-420b-b60f-cfbbf7693423","block_type":"box","text":"The term “purchase,” as used in the Prospectus and this SAI, refers to (i) a single purchase by an individual,","page_number":129,"box":{"x":101,"y":725,"width":776,"height":11}},{"id":"58e6d2d7-de3c-440a-987c-df03c9672feb","block_type":"box","text":"(ii) concurrent purchases by an individual, his or her spouse and their children purchasing shares for his, her or their","page_number":129,"box":{"x":69,"y":740,"width":831,"height":11}},{"id":"6c2254d6-1954-4487-8c71-deaecce720d6","block_type":"box","text":"own account, and (iii) single purchases by a trustee or other fiduciary purchasing shares for a single trust estate or","page_number":129,"box":{"x":69,"y":755,"width":822,"height":11}},{"id":"2f53f13e-010b-4134-9eb1-1d32abb8d140","block_type":"box","text":"single fiduciary account although more than one beneficiary may be involved. The term “purchase” also includes","page_number":129,"box":{"x":69,"y":770,"width":802,"height":12}},{"id":"e54723db-2e0a-41a9-9692-eb2b9e7fa93d","block_type":"box","text":"purchases by any “company,” as that term is defined in the Investment Company Act, but does not include purchases","page_number":129,"box":{"x":70,"y":785,"width":839,"height":12}},{"id":"dd461d43-f276-4ac0-bace-27fc39bfd5cf","block_type":"box","text":"by (i) any company that has not been in existence for at least six months, (ii) a company that has no purpose other","page_number":129,"box":{"x":69,"y":801,"width":819,"height":11}},{"id":"4bab26d7-3572-42c0-bfea-44b8b8969f91","block_type":"box","text":"than the purchase of shares of a Fund or shares of other registered investment companies at a discount, or (iii) any","page_number":129,"box":{"x":68,"y":816,"width":827,"height":11}},{"id":"c33b3ad1-b8db-4449-a10e-39857c534fb2","block_type":"box","text":"group of individuals whose sole organizational nexus is that its par ticipants are credit cardholders of a company,","page_number":129,"box":{"x":68,"y":831,"width":803,"height":11}},{"id":"4ae2c651-f41a-41dc-b87f-d20a7a82ced9","block_type":"box","text":"policyholders of an insurance company, customers of either a bank or broker-dealer or clients of an investment","page_number":129,"box":{"x":70,"y":846,"width":788,"height":11}},{"id":"41594d0d-93f5-4c56-999b-12764c750775","block_type":"box","text":"adviser.","page_number":129,"box":{"x":69,"y":861,"width":53,"height":9}},{"id":"3d0e3083-e4be-4b29-aec6-f18853e96db3","block_type":"box","text":"With cer tain limited exceptions, the Funds are generally available only to investors residing in the United States","page_number":129,"box":{"x":101,"y":884,"width":795,"height":11}},{"id":"39454459-a526-47f3-bd4b-f2136c187acd","block_type":"box","text":"and may not be distributed by a foreign financial intermediary. Under this policy, in order to accept new accounts or","page_number":129,"box":{"x":69,"y":899,"width":821,"height":11}},{"id":"cff3e80c-333e-4961-99cf-25cf3b5eab73","block_type":"box","text":"II-98","page_number":129,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"bc4720c4-fb3e-4b66-99c5-3b5d470fcabc","block_type":"box","text":"NM1026U-5982568-129/232","page_number":129,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"98965bf5-ea95-4400-a10f-98fb99b80337","block_type":"box","text":"additional investments (including by way of exchange from another Fund) into existing accounts, a Fund generally","page_number":130,"box":{"x":69,"y":45,"width":803,"height":11}},{"id":"1b2813d6-bbaf-468f-a2c3-9c44b7b450d5","block_type":"box","text":"requires that (i) a shareholder that is a natural person be a U.S. citizen or resident alien, in each case residing within","page_number":130,"box":{"x":69,"y":60,"width":834,"height":11}},{"id":"de592bf0-b755-45d5-98ec-47166d852264","block_type":"box","text":"the United States or a U.S. territory (including APO/FPO/DPO addresses), and have a valid U.S. taxpayer","page_number":130,"box":{"x":68,"y":75,"width":747,"height":11}},{"id":"4367739b-d7ff-4177-b906-b9174e9dac85","block_type":"box","text":"identification number, and (ii) a financial intermediary or a shareholder that is an entity be domiciled in the United","page_number":130,"box":{"x":70,"y":90,"width":809,"height":11}},{"id":"c299d30d-77fe-4e46-a6f1-022d56be631d","block_type":"box","text":"States and have a valid U.S. taxpayer identification number or be domiciled in a U.S. territory and have a valid U.S.","page_number":130,"box":{"x":69,"y":105,"width":819,"height":11}},{"id":"7db2b5c2-2b6f-43ee-9824-d34c5b20f598","block_type":"box","text":"taxpayer identification number or IRS Form W-8. Any existing account that is updated to reflect a non-U.S. address will","page_number":130,"box":{"x":68,"y":120,"width":840,"height":12}},{"id":"6b475fc2-9a9c-4171-b861-b89134639f60","block_type":"box","text":"also be restricted from making additional investments.","page_number":130,"box":{"x":69,"y":135,"width":388,"height":12}},{"id":"46107be5-88c1-418a-ac23-59809c7bc215","block_type":"box","text":"In-Kind Purchases","page_number":130,"box":{"x":102,"y":158,"width":127,"height":9}},{"id":"30574de2-ca25-491a-ae43-6a43cbe5e191","block_type":"box","text":". Payment for shares of a Fund may, at the discretion of BlackRock, be made in the form of","page_number":130,"box":{"x":230,"y":158,"width":649,"height":11}},{"id":"c6607e2d-ee69-409f-ac88-52c09c845928","block_type":"box","text":"securities that are permissible investments for the Fund and that meet the investment objective, policies and","page_number":130,"box":{"x":69,"y":173,"width":779,"height":11}},{"id":"26f08ea7-afc8-460c-afd4-9c4557602f28","block_type":"box","text":"limitations of the Fund as described herein. In connection with an in-kind securities payment, the Fund may require,","page_number":130,"box":{"x":70,"y":188,"width":820,"height":11}},{"id":"8aa13663-aaf5-450e-a314-356d6a63eda0","block_type":"box","text":"among other things, that the securities: (i) be valued on the day of purchase in accordance with the pricing methods","page_number":130,"box":{"x":69,"y":203,"width":827,"height":12}},{"id":"f939fd3e-d83d-4435-82bc-421b3a24531d","block_type":"box","text":"used by the Fund; (ii) be accompanied by satisfactory assurance that the Fund will have good and marketable title to","page_number":130,"box":{"x":69,"y":218,"width":831,"height":12}},{"id":"5378e440-fe9f-4835-a518-2347c60391d8","block_type":"box","text":"such securities; (iii) not be subject to any restrictions upon resale by the Fund; (iv) be in proper form for transfer to","page_number":130,"box":{"x":69,"y":234,"width":817,"height":11}},{"id":"00ca7c13-6523-4296-a263-299cc5c8c11f","block_type":"box","text":"the Fund; and (v) be accompanied by adequate information concerning the basis and other tax matters relating to the","page_number":130,"box":{"x":68,"y":249,"width":837,"height":11}},{"id":"4d023ac3-541f-4bc8-892d-095a0efcc37e","block_type":"box","text":"securities. All dividends, interest, subscription or other rights per taining to such securities shall become the proper ty","page_number":130,"box":{"x":69,"y":264,"width":835,"height":11}},{"id":"00b1f88a-2cde-4244-bfdd-2e9a99a03bc3","block_type":"box","text":"of the Fund engaged in the in-kind purchase transaction and must be delivered to the Fund by the investor upon","page_number":130,"box":{"x":69,"y":279,"width":795,"height":11}},{"id":"b8cfcce7-2df7-4afc-a14c-7780a5b65cd1","block_type":"box","text":"receipt from the issuer. Shares purchased in exchange for securities generally cannot be redeemed until the transfer","page_number":130,"box":{"x":69,"y":294,"width":833,"height":11}},{"id":"ae6e002b-b4d9-4cc4-9d00-59c5bc763e54","block_type":"box","text":"has settled.","page_number":130,"box":{"x":69,"y":309,"width":83,"height":9}},{"id":"39c974ca-fa39-4bc2-bf6b-4465e2b892e6","block_type":"box","text":"Institutional Shares","page_number":130,"box":{"x":69,"y":340,"width":142,"height":8}},{"id":"f5b56e43-9741-4278-8e94-ea2a1b58f38f","block_type":"box","text":"Institutional Shares may be purchased at NAV without a sales charge. Only cer tain investors are eligible to","page_number":130,"box":{"x":102,"y":362,"width":759,"height":11}},{"id":"dadb8811-030a-4c90-b0a8-0aa696d3e0e4","block_type":"box","text":"purchase Institutional Shares. Investors who are eligible to purchase Institutional Shares should purchase","page_number":130,"box":{"x":70,"y":377,"width":756,"height":12}},{"id":"20959a08-09cc-4859-ac92-92668a7c3010","block_type":"box","text":"Institutional Shares because they are not subject to any sales charge and have lower ongoing expenses than","page_number":130,"box":{"x":70,"y":392,"width":775,"height":12}},{"id":"54368f4d-92de-4fcc-88d7-87deb33f85fc","block_type":"box","text":"Investor A, Investor A1, Investor C, Investor P, Class R or Service Shares. A Fund may in its discretion waive or modify","page_number":130,"box":{"x":70,"y":407,"width":839,"height":12}},{"id":"e42efa84-155d-4cde-9b5c-fcb3ef5a88c6","block_type":"box","text":"any minimum investment amount, may reject any order for any class of shares and may suspend and resume the","page_number":130,"box":{"x":69,"y":423,"width":807,"height":11}},{"id":"763defb4-0f4c-4639-a5cb-08782b4a3365","block_type":"box","text":"sale of shares of any Fund at any time.","page_number":130,"box":{"x":69,"y":438,"width":276,"height":11}},{"id":"11fdde71-3928-4275-b22b-6c4b9134392b","block_type":"box","text":"Eligible Institutional Share Investors.","page_number":130,"box":{"x":102,"y":460,"width":259,"height":12}},{"id":"0731d0b8-d467-4094-97a4-9d07e5fcf872","block_type":"box","text":"Institutional Shares of the Funds may be purchased by customers of broker","page_number":130,"box":{"x":369,"y":460,"width":540,"height":12}},{"id":"f6b70a68-3b42-4607-8f44-ab0d157a5a27","block_type":"box","text":"dealers and agents that have established a servicing relationship with the Fund on behalf of their customers. These","page_number":130,"box":{"x":69,"y":475,"width":826,"height":12}},{"id":"bc619563-3009-476b-b717-8c395fddc88a","block_type":"box","text":"broker-dealers and agents may impose additional or different conditions on the purchase or redemption of Fund","page_number":130,"box":{"x":69,"y":491,"width":796,"height":11}},{"id":"3b5e43a9-c35f-4c51-8696-74bf04135cc3","block_type":"box","text":"shares by their customers and may charge their customers transaction, account or other fees on the purchase and","page_number":130,"box":{"x":69,"y":506,"width":819,"height":11}},{"id":"a0c4b1dc-0ca0-4400-94c3-b8044b31b4e6","block_type":"box","text":"redemption of Fund shares. Each broker-dealer or agent is responsible for transmitting to its customers a schedule of","page_number":130,"box":{"x":69,"y":521,"width":840,"height":11}},{"id":"bd6f13e3-981b-4d58-910b-7c24562d8e11","block_type":"box","text":"any such fees and information regarding any additional or different conditions regarding purchases and redemptions.","page_number":130,"box":{"x":69,"y":536,"width":833,"height":11}},{"id":"8d13780e-db4c-4ea1-880f-c01df55d5aff","block_type":"box","text":"Shareholders who are customers of such broker-dealers or agents should consult them for information regarding","page_number":130,"box":{"x":69,"y":551,"width":802,"height":11}},{"id":"2fe32aed-4857-46bc-97d3-360b241a22f3","block_type":"box","text":"these fees and conditions.","page_number":130,"box":{"x":68,"y":566,"width":189,"height":9}},{"id":"b0061fe2-c5d8-423f-962c-8c4a1d6a6e0f","block_type":"box","text":"Payment for Institutional Shares must normally be made in Federal funds or other funds immediately available by","page_number":130,"box":{"x":102,"y":589,"width":805,"height":11}},{"id":"b0cae8df-37f0-4b67-bd23-9b8625683231","block_type":"box","text":"4 p.m. (Eastern time) on the first business day following receipt of the order. Payment may also, in the discretion of","page_number":130,"box":{"x":69,"y":604,"width":825,"height":11}},{"id":"35e7526a-3f42-455d-b77c-c7075a2ba760","block_type":"box","text":"cer tain Funds, be made in the form of securities that are permissible investments for such Funds. If payment for a","page_number":130,"box":{"x":69,"y":619,"width":817,"height":11}},{"id":"975cae2b-aa8b-47b8-9f9d-2ba624c79522","block_type":"box","text":"purchase order is not received by the prescribed time, an investor may be liable for any resulting losses or expenses","page_number":130,"box":{"x":70,"y":634,"width":831,"height":12}},{"id":"2659e1bf-a236-40de-9d13-bd6ce8d660c8","block_type":"box","text":"incurred by the Fund.","page_number":130,"box":{"x":70,"y":650,"width":147,"height":11}},{"id":"0b0ab065-9f20-4704-a8e9-03793ba9c8e9","block_type":"box","text":"Cer tain of the Funds offer Institutional Shares as described in each such Fund’s Prospectus. In addition, the","page_number":130,"box":{"x":102,"y":672,"width":774,"height":11}},{"id":"0dd58350-a730-4e4c-8e5f-9cc1f4a21afa","block_type":"box","text":"following investors may purchase Institutional Shares: employees, officers and directors/trustees of BlackRock, Inc.,","page_number":130,"box":{"x":68,"y":687,"width":834,"height":11}},{"id":"bfd406aa-8867-4bd0-9678-85100f5fe9b0","block_type":"box","text":"BlackRock Funds, Bank of America Corporation (“BofA Corp.”), Barclays PLC or their respective affiliates and","page_number":130,"box":{"x":70,"y":702,"width":773,"height":11}},{"id":"7acb070b-df2d-4364-9772-0b389dae7605","block_type":"box","text":"immediate family members of such persons, individuals and “Institutional Investors” with a minimum initial","page_number":130,"box":{"x":70,"y":717,"width":762,"height":12}},{"id":"da20caae-f54f-4704-94c8-5b9a3c7915ac","block_type":"box","text":"investment of $2 million who may purchase shares of a Fund through a financial intermediary that has entered into","page_number":130,"box":{"x":70,"y":732,"width":821,"height":12}},{"id":"e309fee6-a098-4dd7-8cec-6afc74f36f80","block_type":"box","text":"an agreement with the Distributor to purchase such shares (“Institutional Investors” include, but are not limited to,","page_number":130,"box":{"x":69,"y":748,"width":819,"height":11}},{"id":"fa956a35-a498-42bf-9c79-e5a85bc203c0","block_type":"box","text":"endowments, foundations, family offices, local, city, and state governmental institutions, corporations, and insurance","page_number":130,"box":{"x":69,"y":763,"width":836,"height":11}},{"id":"734de225-fd03-4862-9c8d-b09c5345444c","block_type":"box","text":"company separate accounts); employer-sponsored retirement plans (which, for this purpose, do not include SEP IRAs,","page_number":130,"box":{"x":69,"y":778,"width":837,"height":11}},{"id":"846ad039-0e90-4f28-b986-cb3ba2efa394","block_type":"box","text":"SIMPLE IRAs or SARSEPs), state sponsored 529 college savings plans, collective trust funds, investment companies","page_number":130,"box":{"x":69,"y":793,"width":832,"height":11}},{"id":"83db7d7b-fea1-408a-98bf-d56c26c62ba0","block_type":"box","text":"or other pooled investment vehicles, unaffiliated thrifts and unaffiliated banks and trust companies, each of which","page_number":130,"box":{"x":69,"y":808,"width":815,"height":11}},{"id":"b0cf4d04-ebc5-4784-99bc-b850ebc36228","block_type":"box","text":"may purchase shares of the Fund through a financial intermediary that has entered into an agreement with the","page_number":130,"box":{"x":69,"y":823,"width":789,"height":12}},{"id":"83d8121a-f9f8-404d-9420-856333a27638","block_type":"box","text":"Distributor to purchase such shares; clients investing through a self-directed IRA brokerage account program","page_number":130,"box":{"x":70,"y":838,"width":772,"height":12}},{"id":"d99b8041-e204-4606-b164-cd4603f67d30","block_type":"box","text":"sponsored by a retirement plan record-keeper, provided that such program offers only mutual fund options and that","page_number":130,"box":{"x":69,"y":853,"width":822,"height":12}},{"id":"71d999f1-9ac6-4560-8c84-e2cddf13e567","block_type":"box","text":"the program maintains an account with the Fund on an omnibus basis; clients of financial intermediaries that:","page_number":130,"box":{"x":68,"y":869,"width":783,"height":11}},{"id":"31cacf7b-4b7c-430f-a5ab-0d4c79977ba8","block_type":"box","text":"(i) charge such clients a fee for advisory, investment consulting, or similar services or (ii) have entered into an","page_number":130,"box":{"x":69,"y":884,"width":785,"height":11}},{"id":"23f24db5-1bac-4917-8a08-0d1435f64655","block_type":"box","text":"agreement with the Distributor to offer Institutional Shares through a no-load program or investment platform, in each","page_number":130,"box":{"x":69,"y":899,"width":838,"height":11}},{"id":"121a4f08-8ee5-46e6-b54f-ac989520ca72","block_type":"box","text":"II-99","page_number":130,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"649bb057-3edf-45a4-9d46-7ffcf6c6d16b","block_type":"box","text":"NM1026U-5982568-130/232","page_number":130,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"8a672869-2c78-444a-afdd-6c6a50a5e670","block_type":"box","text":"case, with no minimum initial investment; clients investing through financial intermediaries that have entered into an","page_number":131,"box":{"x":69,"y":45,"width":831,"height":11}},{"id":"db51a596-0375-41d9-bd21-0f948ea849fc","block_type":"box","text":"agreement with the Distributor to offer such shares on a platform that charges a transaction based sales","page_number":131,"box":{"x":69,"y":60,"width":751,"height":11}},{"id":"d62ce043-aecd-4e27-b9ff-71478b096b3d","block_type":"box","text":"commission outside of the Fund, with a minimum initial investment of $1,000; tax-qualified accounts for insurance","page_number":131,"box":{"x":69,"y":74,"width":817,"height":12}},{"id":"47ab7d79-6d83-46d9-aee8-3828eac3e015","block_type":"box","text":"agents that are registered representatives of an insurance company’s broker-dealer that has entered into an","page_number":131,"box":{"x":69,"y":90,"width":773,"height":11}},{"id":"88fbf3de-fa2a-4b15-9d75-9516433d1584","block_type":"box","text":"agreement with the Distributor to offer Institutional Shares, and the family members of such persons, with a","page_number":131,"box":{"x":69,"y":105,"width":771,"height":11}},{"id":"2cde2d88-1526-4952-8da0-59e7d138760e","block_type":"box","text":"minimum initial investment of $1,000; trust depar tment clients of Bank of America, N.A. and its affiliates for whom","page_number":131,"box":{"x":69,"y":120,"width":822,"height":11}},{"id":"467d6e1e-92f8-4340-826d-f312a56b6985","block_type":"box","text":"they (i) act in a fiduciary capacity (excluding par ticipant directed employee benefit plans), (ii) otherwise have","page_number":131,"box":{"x":68,"y":135,"width":771,"height":12}},{"id":"40b64252-478e-42fb-9d0d-270f857cebb3","block_type":"box","text":"investment discretion, or (iii) act as custodian for at least $2 million in assets; and holders of cer tain BofA Corp.","page_number":131,"box":{"x":70,"y":150,"width":801,"height":11}},{"id":"5bc94808-61cb-44f0-b5b9-b302d63ec616","block_type":"box","text":"sponsored unit investment trusts (UITs) who reinvest dividends received from such UITs in shares of a Fund.","page_number":131,"box":{"x":69,"y":166,"width":770,"height":11}},{"id":"ddcbba44-2663-4da8-856f-0e3e381f0177","block_type":"box","text":"Purchase Privileges of Cer tain Persons.","page_number":131,"box":{"x":102,"y":188,"width":280,"height":12}},{"id":"5db0e5d5-a9fe-4f24-9e0f-304fec9d8de4","block_type":"box","text":"Employees, officers, directors/trustees of BlackRock, Inc., BlackRock","page_number":131,"box":{"x":389,"y":188,"width":496,"height":11}},{"id":"75d2238d-55cd-4761-b453-b4a05c3ad62b","block_type":"box","text":"Funds, BofA Corp. or their respective affiliates; and any trust, pension, profit-sharing or other benefit plan for such","page_number":131,"box":{"x":70,"y":203,"width":812,"height":12}},{"id":"f66f2de2-a280-45f3-afdc-43285c024da9","block_type":"box","text":"persons may purchase Institutional Shares at lower investment minimums than stated in each Fund’s Prospectus. A","page_number":131,"box":{"x":70,"y":219,"width":828,"height":11}},{"id":"78617db1-422c-484e-ba0a-cd34aef6770a","block_type":"box","text":"Fund realizes economies of scale and reduction of sales-related expenses by vir tue of the familiarity of these persons","page_number":131,"box":{"x":70,"y":234,"width":838,"height":11}},{"id":"e0d7d348-7fec-4190-8cbb-24436fb38c07","block_type":"box","text":"with the Fund. Employees, directors, and board members of other funds wishing to purchase shares of a Fund must","page_number":131,"box":{"x":68,"y":249,"width":826,"height":11}},{"id":"19b038e5-d1b5-4858-b016-b3ddd3444a49","block_type":"box","text":"satisfy the Fund’s suitability standards.","page_number":131,"box":{"x":69,"y":264,"width":279,"height":11}},{"id":"380a14ff-2d6f-4ade-9ab9-a976e1a865f3","block_type":"box","text":"Initial Sales Charge Alternative — Investor A Shares","page_number":131,"box":{"x":69,"y":294,"width":382,"height":11}},{"id":"c69d3373-dad7-4b33-a00c-26333342d30e","block_type":"box","text":"Investors who prefer an initial sales charge alternative may elect to purchase Investor A Shares. Investor A1","page_number":131,"box":{"x":102,"y":317,"width":770,"height":11}},{"id":"25c0d287-47f0-4382-a475-7be1a2a74c47","block_type":"box","text":"Shares are offered only (i) for purchase by cer tain employer-sponsored retirement plans and fee-based programs that","page_number":131,"box":{"x":69,"y":332,"width":837,"height":11}},{"id":"ae905ef5-82ae-4457-a059-728d7a52beef","block_type":"box","text":"have been previously approved by cer tain Funds, and (ii) to cer tain investors who currently hold Investor A1 Shares","page_number":131,"box":{"x":69,"y":347,"width":819,"height":11}},{"id":"8ce905c0-cebf-45a6-8972-30db8ad1bc6d","block_type":"box","text":"for dividend and capital gain reinvestment only. The Investor A1 initial sales charge does not apply to the transactions","page_number":131,"box":{"x":68,"y":362,"width":840,"height":11}},{"id":"5afe5933-2657-40f6-8b3e-099183ac302b","block_type":"box","text":"described in (i) and (ii). For ease of reference, Investor A, Investor A1 and Investor P (discussed below) Shares are","page_number":131,"box":{"x":69,"y":377,"width":815,"height":11}},{"id":"c7969a7d-c314-4a42-9283-985703ef586d","block_type":"box","text":"sometimes referred to herein as “front-end load shares.” Investor A Shares of Index Funds (defined below) and","page_number":131,"box":{"x":69,"y":392,"width":791,"height":11}},{"id":"2c611510-d238-4c70-b78f-f694cc8cc1a2","block_type":"box","text":"BlackRock Shor t Obligations Fund generally are not subject to an initial sales charge or front-end load.","page_number":131,"box":{"x":70,"y":407,"width":727,"height":12}},{"id":"99e62906-a641-4c29-b980-fc4da50a7a54","block_type":"box","text":"Investors qualifying for significantly reduced initial sales charges may find the initial sales charge alternative","page_number":131,"box":{"x":102,"y":430,"width":770,"height":11}},{"id":"f5341143-b2cf-490e-aaa3-3603dc5654f7","block_type":"box","text":"par ticularly attractive because similar sales charge reductions are not available with respect to the deferred sales","page_number":131,"box":{"x":70,"y":445,"width":812,"height":12}},{"id":"c124c48b-7993-46f4-adc9-d72aab32130e","block_type":"box","text":"charges imposed in connection with investments in Investor C Shares (sometimes referred to herein as “CDSC","page_number":131,"box":{"x":69,"y":460,"width":791,"height":12}},{"id":"45b0ed09-fa3e-46da-a9ac-768fa4c5c52c","block_type":"box","text":"shares”). Investors who do not qualify for reduced initial sales charges and who expect to maintain their investment","page_number":131,"box":{"x":69,"y":475,"width":826,"height":12}},{"id":"46e5e6bc-cc5f-4b77-9ae4-380180a998a7","block_type":"box","text":"for an extended period of time also may elect to purchase Investor A Shares, because over time the accumulated","page_number":131,"box":{"x":68,"y":491,"width":808,"height":11}},{"id":"59bab4e6-27e3-4af6-9ca7-fea3aa0d6115","block_type":"box","text":"ongoing service and distribution fees on CDSC shares may exceed the front-end load shares’ initial sales charge and","page_number":131,"box":{"x":69,"y":506,"width":834,"height":11}},{"id":"8b291cb8-ecaa-438b-bc2d-1318d2bc981e","block_type":"box","text":"service fee. Although some investors who previously purchased Institutional Shares may no longer be eligible to","page_number":131,"box":{"x":69,"y":521,"width":798,"height":11}},{"id":"33b45be9-c0e7-4a02-aa3c-0ccd650408a4","block_type":"box","text":"purchase Institutional Shares of other Funds, those previously purchased Institutional Shares, together with all","page_number":131,"box":{"x":70,"y":536,"width":789,"height":11}},{"id":"22312d7b-18f2-48e8-959a-e5ae94f5dc4e","block_type":"box","text":"BlackRock front-end load and CDSC share holdings, will count toward a right of accumulation that may qualify the","page_number":131,"box":{"x":70,"y":551,"width":805,"height":11}},{"id":"ae9f81ef-cc4d-460a-a0c1-bf78862c540c","block_type":"box","text":"investor for a reduced initial sales charge on new initial sales charge purchases. In addition, the ongoing CDSC","page_number":131,"box":{"x":70,"y":566,"width":792,"height":11}},{"id":"9ecb0258-7f9d-4550-bdd3-863ed8c439a4","block_type":"box","text":"shares service and distribution fees will cause CDSC shares to have higher expense ratios, pay lower dividends and","page_number":131,"box":{"x":69,"y":581,"width":826,"height":12}},{"id":"1d1849e9-f896-494e-b48a-dc31ef0a5620","block_type":"box","text":"have lower total returns than the initial sales charge shares. The ongoing front-end load shares’ service fees will","page_number":131,"box":{"x":69,"y":596,"width":802,"height":12}},{"id":"5088b615-30ba-43d0-adf5-03f1371e0fc0","block_type":"box","text":"cause Investor A, Investor A1, Investor P and Service Shares to have a higher expense ratio, pay lower dividends and","page_number":131,"box":{"x":69,"y":612,"width":834,"height":11}},{"id":"bf570558-5702-49ea-bda6-eaa0466b76a9","block_type":"box","text":"have a lower total return than Institutional Shares.","page_number":131,"box":{"x":69,"y":627,"width":358,"height":9}},{"id":"507b21a8-5ae7-45d1-92b5-7391e83d2c81","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Par t I of each Fund’s SAI for","page_number":131,"box":{"x":102,"y":649,"width":734,"height":12}},{"id":"4999c81e-b7f1-431d-9033-a488231e583e","block_type":"box","text":"information about amounts paid to the Distributor in connection with Investor A and Investor A1 Shares for the","page_number":131,"box":{"x":70,"y":664,"width":785,"height":11}},{"id":"93966bc7-c60f-487e-a363-be84161249fd","block_type":"box","text":"periods indicated.","page_number":131,"box":{"x":70,"y":680,"width":124,"height":11}},{"id":"8f6e902e-1cb5-472b-80c6-d7d72269aeeb","block_type":"box","text":"The Distributor may reallow discounts to selected securities dealers and other financial intermediaries and retain","page_number":131,"box":{"x":101,"y":702,"width":806,"height":11}},{"id":"96571a2c-1a2c-4623-8eb0-4b7885450a32","block_type":"box","text":"the balance over such discounts. At times the Distributor may reallow the entire sales charge to such dealers. Since","page_number":131,"box":{"x":68,"y":718,"width":830,"height":11}},{"id":"2f7eab7a-3a41-4b57-a5aa-9da785cd9250","block_type":"box","text":"securities dealers and other financial intermediaries selling front-end load shares of a Fund will receive a concession","page_number":131,"box":{"x":69,"y":732,"width":832,"height":12}},{"id":"a4eda285-f903-43d9-b3ca-afcfba611057","block_type":"box","text":"equal to most of the sales charge, they may be deemed to be underwriters under the Securities Act.","page_number":131,"box":{"x":69,"y":748,"width":714,"height":11}},{"id":"e9019d23-3583-4b50-849d-e91de5be3a63","block_type":"box","text":"Initial Sales Charge — Investor P Shares","page_number":131,"box":{"x":69,"y":778,"width":297,"height":11}},{"id":"c14f2a2f-c5ed-49d0-a5eb-d601fcf1f884","block_type":"box","text":"Cer tain Funds offer Investor P Shares as described in each such Fund’s Prospectus, Investor P Shares are","page_number":131,"box":{"x":102,"y":801,"width":761,"height":11}},{"id":"498da256-78a5-4051-9be3-e918ba7f2e6c","block_type":"box","text":"available for purchase only through registered representatives of an insurance company’s broker-dealer that has","page_number":131,"box":{"x":69,"y":816,"width":800,"height":11}},{"id":"40b16ec2-fe5e-45c5-8b3f-dc2e6fc39b2a","block_type":"box","text":"entered into an agreement with the Distributor to offer such shares and are subject to an initial sales charge. The","page_number":131,"box":{"x":69,"y":831,"width":812,"height":11}},{"id":"8ca6f827-379b-41db-8873-61e8be65e6af","block_type":"box","text":"ongoing front-end load shares’ service fees will cause Investor P Shares to have a higher expense ratio, pay lower","page_number":131,"box":{"x":69,"y":846,"width":813,"height":11}},{"id":"2137327e-1dfb-4fb8-8c00-caf3c9d6e6f1","block_type":"box","text":"dividends and have a lower total return than Investor A Shares of the same Fund.","page_number":131,"box":{"x":69,"y":861,"width":578,"height":9}},{"id":"dd94fa83-ebb5-49fc-8ec0-dc3fb1cf0489","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Par t I of each Fund’s SAI for","page_number":131,"box":{"x":102,"y":884,"width":734,"height":11}},{"id":"19d491ff-f353-49a3-a3d3-03ab4974ecf7","block_type":"box","text":"information about amounts paid to the Distributor in connection with Investor P Shares for the periods indicated.","page_number":131,"box":{"x":70,"y":899,"width":800,"height":11}},{"id":"fbce1285-cd3c-4be0-91f8-d8e58ad8ffc0","block_type":"box","text":"II-100","page_number":131,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"8bcef428-7d7b-411e-8bd1-4e7fdf7e3108","block_type":"box","text":"NM1026U-5982568-131/232","page_number":131,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"f8311958-ed20-42a5-b249-a7895082018b","block_type":"box","text":"The Distributor may reallow discounts to selected securities dealers and other financial intermediaries and retain","page_number":132,"box":{"x":101,"y":45,"width":806,"height":11}},{"id":"3ddb4578-cab3-47b1-8fee-fcdd1417d3d3","block_type":"box","text":"the balance over such discounts. At times the Distributor may reallow the entire sales charge to such dealers. Since","page_number":132,"box":{"x":68,"y":60,"width":830,"height":11}},{"id":"6fff135f-a1d7-43cf-aa0d-1bd35fe2f2bd","block_type":"box","text":"securities dealers and other financial intermediaries selling front-end load shares of a Fund will receive a concession","page_number":132,"box":{"x":69,"y":75,"width":832,"height":11}},{"id":"c7fd6917-f800-4ea9-afbe-91a2bb86416d","block_type":"box","text":"equal to most of the sales charge, they may be deemed to be underwriters under the Securities Act.","page_number":132,"box":{"x":69,"y":90,"width":714,"height":11}},{"id":"519c8098-e336-4b12-adcd-1b9144e063cd","block_type":"box","text":"Reduced Initial Sales Charges","page_number":132,"box":{"x":69,"y":120,"width":219,"height":11}},{"id":"b276e037-1dfc-4a97-ad5e-6777302ade50","block_type":"box","text":"Cer tain investors may be eligible for a reduction in or waiver of a sales load due to the nature of the investors","page_number":132,"box":{"x":102,"y":143,"width":782,"height":11}},{"id":"459698bc-e80c-46a4-8b89-ae6e74632305","block_type":"box","text":"and/or the reduced sales effor ts necessary to obtain their investments. Financial intermediaries may, in connection","page_number":132,"box":{"x":69,"y":158,"width":827,"height":11}},{"id":"29267854-5e3c-4803-bfd0-f760efa5aa78","block_type":"box","text":"with a change in account type or otherwise in accordance with a financial intermediary’s policies and procedures,","page_number":132,"box":{"x":68,"y":173,"width":809,"height":11}},{"id":"5e51c986-731f-45ef-a509-2c32605e6c8b","block_type":"box","text":"exchange shares of a Fund from one class of shares to another class of shares of the same Fund provided that the","page_number":132,"box":{"x":69,"y":188,"width":823,"height":12}},{"id":"9661b8f9-e610-4c30-b888-66021d06641a","block_type":"box","text":"exchanged shares are not subject to a contingent deferred sales charge and that shareholders meet the eligibility","page_number":132,"box":{"x":69,"y":203,"width":812,"height":12}},{"id":"f360979b-0042-4f5c-abe4-b3dc3532fa89","block_type":"box","text":"requirements of the new share class. Cer tain sales load reductions and waivers may be available to customers of","page_number":132,"box":{"x":69,"y":218,"width":813,"height":12}},{"id":"bde0e309-d8de-460e-bc93-6f55ebdd4313","block_type":"box","text":"cer tain financial intermediaries, as described under “Intermediary-Defined Sales Charge Waiver Policies” in the","page_number":132,"box":{"x":69,"y":234,"width":793,"height":11}},{"id":"b90eb08a-2f19-49cf-9da3-3cfb2f5e1d33","block_type":"box","text":"Fund’s Prospectus. Please speak to your financial intermediary for more information.","page_number":132,"box":{"x":70,"y":249,"width":603,"height":11}},{"id":"d159466f-b3f7-46d3-8edf-ee839980bcc9","block_type":"box","text":"Reinvested Dividends.","page_number":132,"box":{"x":102,"y":272,"width":156,"height":8}},{"id":"ac3e300e-e549-4e85-a50e-c66361ce8372","block_type":"box","text":"No sales charges are imposed upon shares issued as a result of the automatic","page_number":132,"box":{"x":265,"y":271,"width":566,"height":12}},{"id":"db23db4a-d428-4996-bedf-924110e89c02","block_type":"box","text":"reinvestment of dividends.","page_number":132,"box":{"x":69,"y":286,"width":186,"height":10}},{"id":"c767732f-d548-4c8e-ae26-dafb9dae4f77","block_type":"box","text":"Right of Accumulation.","page_number":132,"box":{"x":102,"y":309,"width":158,"height":11}},{"id":"8dbecfb1-d68a-4f44-b93b-3886a763c881","block_type":"box","text":"Investors have a “right of accumulation” under which any of the following may be","page_number":132,"box":{"x":267,"y":309,"width":574,"height":11}},{"id":"07a996fd-d142-41d0-beaa-f34c83ccf843","block_type":"box","text":"combined with the amount of the current purchase in determining whether an investor qualifies for a breakpoint and","page_number":132,"box":{"x":69,"y":324,"width":826,"height":12}},{"id":"05764167-5e64-4bc8-b797-47037fed4bde","block_type":"box","text":"a reduced front-end sales charge: (i) the current value of an investor’s existing Investor A, Investor A1, Investor C,","page_number":132,"box":{"x":69,"y":339,"width":810,"height":12}},{"id":"44a82279-deb6-47ce-aa2c-2c36223823f6","block_type":"box","text":"Investor P, Institutional, Class K and Premier Shares in most BlackRock Funds, (ii) the current value of an investor’s","page_number":132,"box":{"x":70,"y":355,"width":825,"height":11}},{"id":"733cb78e-f09a-437a-81d7-dc6d44bded2c","block_type":"box","text":"existing shares of cer tain unlisted closed-end management investment companies sponsored and advised by","page_number":132,"box":{"x":69,"y":370,"width":780,"height":11}},{"id":"7f5ceb1c-343c-4ab2-b9ce-ef5d0d8d6099","block_type":"box","text":"BlackRock or its affiliates (“Eligible Unlisted BlackRock Closed-End Funds”) and (iii) the investment in the BlackRock","page_number":132,"box":{"x":70,"y":385,"width":828,"height":11}},{"id":"414d4cf8-e256-41e5-ba14-80df52632143","block_type":"box","text":"CollegeAdvantage 529 Program by the investor or by or on behalf of the investor’s spouse and children. Financial","page_number":132,"box":{"x":69,"y":400,"width":804,"height":11}},{"id":"a304a594-6c25-4177-b218-131a28d0d929","block_type":"box","text":"intermediaries may value current holdings of their customers differently for purposes of determining whether an","page_number":132,"box":{"x":70,"y":415,"width":794,"height":11}},{"id":"99090ee0-5f35-46c7-8587-70375faa85e2","block_type":"box","text":"investor qualifies for a breakpoint and a reduced front-end sales charge, although customers of the same financial","page_number":132,"box":{"x":70,"y":430,"width":814,"height":11}},{"id":"2b3e9e05-faba-4279-96e2-7dbe700fde42","block_type":"box","text":"intermediary will be treated similarly. In order to use this right, the investor must aler t BlackRock to the existence of","page_number":132,"box":{"x":70,"y":445,"width":828,"height":12}},{"id":"3d076bbc-46cd-4f88-8cda-7f82833e5caa","block_type":"box","text":"any previously purchased shares. Cer tain funds employ a “passive” management approach and attempt to match the","page_number":132,"box":{"x":69,"y":460,"width":838,"height":12}},{"id":"2ee6ba88-70b5-4ea6-b380-ce2086e73b7e","block_type":"box","text":"per formance of a target index as closely as possible before the deduction of Fund expenses (“Index Funds”).","page_number":132,"box":{"x":70,"y":475,"width":776,"height":12}},{"id":"0f3ac412-e446-48ad-9444-92ac39995031","block_type":"box","text":"Although Investor A Shares of Index Funds and BlackRock Shor t Obligations Fund generally are not subject to a sales","page_number":132,"box":{"x":68,"y":491,"width":835,"height":11}},{"id":"50f9e0c6-d8f6-4adc-a6b1-1692e75bbcee","block_type":"box","text":"charge, an investor’s existing Investor A, Investor A1, Investor C, Investor P, Institutional, Class K and Premier Shares","page_number":132,"box":{"x":69,"y":506,"width":839,"height":11}},{"id":"dfb81c24-c043-4043-927e-3ffce2f1b2dd","block_type":"box","text":"in the Index Funds and BlackRock Shor t Obligations Fund may be combined with the amount of an investor’s current","page_number":132,"box":{"x":70,"y":521,"width":829,"height":11}},{"id":"612df784-13fc-4077-a838-3c94da606a6d","block_type":"box","text":"purchase in determining whether an investor qualifies for a breakpoint and a reduced front-end sales charge.","page_number":132,"box":{"x":70,"y":536,"width":774,"height":11}},{"id":"5790cc44-5220-45bc-afe9-6b5ba23d56fb","block_type":"box","text":"Letter of Intent.","page_number":132,"box":{"x":102,"y":559,"width":109,"height":9}},{"id":"b234ec05-24cf-445d-afcf-7bc48d2afe1d","block_type":"box","text":"An investor may qualify for a reduced front-end sales charge immediately by signing a “Letter of","page_number":132,"box":{"x":217,"y":559,"width":681,"height":11}},{"id":"f818f1a5-cc84-467d-a7b7-2c6fddd35901","block_type":"box","text":"Intent” stating the investor’s intention to make one or more of the following investments within the next 13 months","page_number":132,"box":{"x":70,"y":574,"width":820,"height":11}},{"id":"548e717b-49b9-42d0-be4c-6031364125ef","block_type":"box","text":"which would, if bought all at once, qualify the investor for a reduced sales charge: (i) buy a specified amount of","page_number":132,"box":{"x":68,"y":589,"width":792,"height":11}},{"id":"50d9cd23-63a2-4383-9687-29262f0f3efb","block_type":"box","text":"Investor A, Investor C, Investor P, Institutional, Class K and/or Premier Shares, (ii) make an investment in one or","page_number":132,"box":{"x":70,"y":604,"width":802,"height":11}},{"id":"1924abb6-5154-4467-8dae-4f6a1677acb6","block_type":"box","text":"more Eligible Unlisted BlackRock Closed-End Funds and/or (iii) make an investment through the BlackRock","page_number":132,"box":{"x":69,"y":619,"width":760,"height":11}},{"id":"3ad6cf18-1651-4f07-84f7-6efb1dbe6f7c","block_type":"box","text":"CollegeAdvantage 529 Program in one or more BlackRock Funds. The initial investment must meet the minimum","page_number":132,"box":{"x":69,"y":634,"width":800,"height":12}},{"id":"faa35257-a4ff-4e34-834a-f95f039f1ddd","block_type":"box","text":"initial purchase requirement. The 13-month Letter of Intent period commences on the day that the Letter of Intent is","page_number":132,"box":{"x":70,"y":649,"width":826,"height":12}},{"id":"d8d6e83a-f9d0-496c-be30-ae4111073a66","block_type":"box","text":"received by the Fund. The market value of current holdings in the BlackRock Funds (including Investor A, Investor C,","page_number":132,"box":{"x":69,"y":664,"width":822,"height":12}},{"id":"76c63484-fb72-4bc7-8b52-50c9486e60db","block_type":"box","text":"Investor P, Institutional, Class K and Premier Shares, Eligible Unlisted BlackRock Closed-End Funds and the","page_number":132,"box":{"x":70,"y":680,"width":764,"height":11}},{"id":"7b13203e-1cbd-4ff4-bdeb-6430c9df47c4","block_type":"box","text":"BlackRock CollegeAdvantage 529 Program Class A and Class C Units) as of the date of commencement that are","page_number":132,"box":{"x":70,"y":695,"width":800,"height":11}},{"id":"0820b4b1-c991-4b2f-b127-6f4c94c67841","block_type":"box","text":"eligible under the Right of Accumulation may be counted towards the sales charge reduction. The investor must notify","page_number":132,"box":{"x":69,"y":710,"width":838,"height":11}},{"id":"dc904c6c-d746-422a-bee5-585b1de8ab39","block_type":"box","text":"the Fund of (i) any current holdings in the BlackRock Funds, Eligible Unlisted BlackRock Closed-End Funds and/or the","page_number":132,"box":{"x":68,"y":725,"width":835,"height":11}},{"id":"dbd35718-c339-413e-a045-6437285c4481","block_type":"box","text":"BlackRock CollegeAdvantage 529 Program that should be counted towards the sales charge reduction and (ii) any","page_number":132,"box":{"x":70,"y":740,"width":811,"height":11}},{"id":"19a37bab-4b04-4a61-b6be-3187cf2cce30","block_type":"box","text":"subsequent purchases that should be counted towards the Letter of Intent. During the term of the Letter of Intent,","page_number":132,"box":{"x":69,"y":755,"width":814,"height":11}},{"id":"496732fa-fc94-4c89-9111-7f51157b6c5d","block_type":"box","text":"the Fund will hold Investor A Shares and/or Investor P Shares, as applicable, representing up to 5% of the indicated","page_number":132,"box":{"x":68,"y":770,"width":827,"height":12}},{"id":"f6855fd5-660c-4828-94ad-c82394c3a879","block_type":"box","text":"amount in an escrow account for payment of a higher sales load if the full amount indicated in the Letter of Intent is","page_number":132,"box":{"x":69,"y":785,"width":827,"height":12}},{"id":"4089273a-88c2-4fbe-96e5-98f1611cea26","block_type":"box","text":"not purchased. If the full amount indicated is not purchased within the 13-month period, and the investor does not","page_number":132,"box":{"x":69,"y":801,"width":817,"height":11}},{"id":"ec11c255-b51b-4e94-b2c4-ae2d61b797c4","block_type":"box","text":"pay the higher sales load within 20 days, the Fund will redeem enough of the Investor A Shares and/or Investor P","page_number":132,"box":{"x":70,"y":816,"width":807,"height":11}},{"id":"ff62a9a7-d667-4eaa-abf4-4008bf91a07c","block_type":"box","text":"Shares, as applicable, held in escrow to pay the difference.","page_number":132,"box":{"x":69,"y":831,"width":423,"height":11}},{"id":"f9f566fd-e0b0-46fe-8066-f51a219b0b56","block_type":"box","text":"Placement Fees.","page_number":132,"box":{"x":102,"y":854,"width":116,"height":8}},{"id":"64a35c7f-5324-41d8-ad25-df03ffcf60bd","block_type":"box","text":"BlackRock may pay placement fees to dealers on purchases of Investor A and Investor P Shares of all Funds,","page_number":132,"box":{"x":102,"y":876,"width":777,"height":11}},{"id":"9ad7e270-6b84-47da-b1e5-ae43f046563a","block_type":"box","text":"which may depend on the policies, procedures and trading platforms of your financial intermediary.","page_number":132,"box":{"x":68,"y":891,"width":704,"height":12}},{"id":"67dbf6f3-99f8-4d65-b12b-f97f69ff428c","block_type":"box","text":"II-101","page_number":132,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"2481172a-5b0e-41de-83e9-d445a7ad2b57","block_type":"box","text":"NM1026U-5982568-132/232","page_number":132,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"2d1b789a-1d83-467a-bb73-8395b53a58dc","block_type":"box","text":"Except as noted below, these placement fees may be up to the following amounts for Investor A Shares:","page_number":133,"box":{"x":102,"y":45,"width":741,"height":11}},{"id":"5e9c1212-71ea-47f2-9df9-e42a4e7cd93b","block_type":"box","text":"$1 million but less than $3 million . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":72,"width":361,"height":10}},{"id":"52697398-18ea-4fd8-aa7b-8054541271d8","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.00%","page_number":133,"box":{"x":535,"y":72,"width":288,"height":9}},{"id":"df313b85-c80b-49a9-a06f-1cd9e2d81697","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":87,"width":361,"height":10}},{"id":"f92e4061-e59d-4b41-989d-74136fe73a89","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":133,"box":{"x":535,"y":88,"width":288,"height":8}},{"id":"4c3ee0c2-ce91-47ca-9012-5b959747a681","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":102,"width":345,"height":10}},{"id":"6d205195-e0ff-4243-a606-aa593efd8ac4","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":133,"box":{"x":518,"y":103,"width":305,"height":9}},{"id":"8023c0dd-3590-41df-8ae8-d71797248994","block_type":"box","text":"With respect to Investor A Shares of BlackRock Global Allocation Fund, Inc., BlackRock Dynamic High Income","page_number":133,"box":{"x":101,"y":126,"width":776,"height":12}},{"id":"f64f4569-8bd0-4395-82b0-8eea1f0a3e4e","block_type":"box","text":"Por tfolio (for shares purchased prior to July 1, 2020) and BlackRock Multi-Asset Income Por tfolio (for shares","page_number":133,"box":{"x":69,"y":142,"width":774,"height":11}},{"id":"b2d11ca3-f044-4914-bffc-dde7f318bc01","block_type":"box","text":"purchased prior to July 1, 2020) of BlackRock Funds II, BlackRock Credit Relative Value Fund of BlackRock Funds IV","page_number":133,"box":{"x":70,"y":157,"width":824,"height":11}},{"id":"13abf2ea-dcb9-4961-a8e8-b605635aa958","block_type":"box","text":"and BlackRock Event Driven Equity Fund, the placement fees may be up to the following amounts:","page_number":133,"box":{"x":69,"y":172,"width":695,"height":11}},{"id":"9312268a-215c-449b-b860-32843b76e9a8","block_type":"box","text":"$250,000 but less than $3 million . . . . . . . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":199,"width":410,"height":11}},{"id":"f2e1d0ff-6f67-4adb-a6d2-a1053ace20b8","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 1.00%","page_number":133,"box":{"x":583,"y":200,"width":240,"height":9}},{"id":"8ca4e1d8-a892-4b25-8bc8-6156e3d2062d","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":214,"width":361,"height":11}},{"id":"fae24378-dd47-4b45-be35-d8d07ecf1b2e","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":133,"box":{"x":535,"y":215,"width":288,"height":9}},{"id":"37d661d0-b4df-44f3-8913-d17bed9cddb8","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":229,"width":345,"height":11}},{"id":"43feb8a7-48c1-4751-ac59-ddbf3c425a80","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":133,"box":{"x":518,"y":230,"width":305,"height":9}},{"id":"8bf3ed2f-842d-4a4e-a4af-b29dc757ec84","block_type":"box","text":"With respect to Investor A Shares of BlackRock Systematic Multi-Strategy Fund of BlackRock Funds IV, BlackRock","page_number":133,"box":{"x":101,"y":254,"width":806,"height":11}},{"id":"7d0e1070-8670-405c-838b-2d916b822375","block_type":"box","text":"Advantage CoreAlpha Bond Fund of BlackRock Funds VI, BlackRock Tactical Oppor tunities Fund of BlackRock Funds","page_number":133,"box":{"x":68,"y":269,"width":821,"height":11}},{"id":"0c52cbc9-ca69-48fa-b0fa-802df66a9f2a","block_type":"box","text":"SM","page_number":133,"box":{"x":890,"y":269,"width":11,"height":5}},{"id":"7eb651f0-5a40-4c3d-8cf9-fdfaca09aa6a","block_type":"box","text":",","page_number":133,"box":{"x":903,"y":276,"width":2,"height":3}},{"id":"867cecf6-ef6e-4454-b265-07e0e8a8b6c6","block_type":"box","text":"BlackRock High Yield Por tfolio, BlackRock Core Bond Por tfolio and BlackRock Sustainable High Yield Bond Fund of","page_number":133,"box":{"x":70,"y":284,"width":816,"height":11}},{"id":"da7c7bcc-eb7d-444c-b888-64b979cb90f9","block_type":"box","text":"BlackRock Funds V, BlackRock Securitized Income Fund of Managed Account Series II and BlackRock Strategic Global","page_number":133,"box":{"x":70,"y":299,"width":835,"height":11}},{"id":"e9cc79fe-001b-439c-93f9-5393a7431e51","block_type":"box","text":"Bond Fund, Inc., the placement fees may be up to the following amounts:","page_number":133,"box":{"x":70,"y":314,"width":520,"height":12}},{"id":"59f8259e-a334-45a4-8e8f-c20e40eebba5","block_type":"box","text":"$1 million but less than $3 million . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":341,"width":361,"height":11}},{"id":"bdedb632-64c6-4224-961c-17c0c2c3090d","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.75%","page_number":133,"box":{"x":535,"y":342,"width":288,"height":9}},{"id":"6d76acdb-2a79-4947-a054-8462746e8b46","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":356,"width":361,"height":11}},{"id":"3ff4f3d0-cf8c-439f-b735-0a9e65e896b0","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":133,"box":{"x":535,"y":357,"width":288,"height":9}},{"id":"67b0ee64-5950-4a83-b2f2-8032a94276bf","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":372,"width":345,"height":10}},{"id":"dd431590-9c83-4c76-b689-5133b5503e70","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":133,"box":{"x":518,"y":372,"width":305,"height":9}},{"id":"10a0f55e-0607-43bf-8a2e-3161062d1c0d","block_type":"box","text":"With respect to Investor A Shares of BlackRock Mor tgage-Backed Securities Fund and BlackRock Impact","page_number":133,"box":{"x":101,"y":396,"width":743,"height":11}},{"id":"80acb2e4-cd24-41ee-956d-107d29386622","block_type":"box","text":"Mor tgage Fund of BlackRock Funds V, the placement fees may be up to the following amounts:","page_number":133,"box":{"x":70,"y":411,"width":674,"height":12}},{"id":"60a8c7a9-1e4d-4dcc-bc4d-dfe906bbcb55","block_type":"box","text":"$1 million but less than $3 million . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":438,"width":361,"height":11}},{"id":"6c246aa1-88c4-4643-8577-ed7eda72019c","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":133,"box":{"x":535,"y":439,"width":288,"height":9}},{"id":"8bf46368-5d33-479e-b026-780d4bebe6d0","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":453,"width":361,"height":11}},{"id":"819c19d5-f134-49bb-8527-7d00faaf1f9f","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":133,"box":{"x":535,"y":454,"width":288,"height":9}},{"id":"db6a5d4e-36e6-42c2-a5a0-34d4942716e6","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":469,"width":345,"height":10}},{"id":"b265b8f0-1957-4ef0-9786-62027128c64d","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.15%","page_number":133,"box":{"x":518,"y":469,"width":305,"height":9}},{"id":"ea309e6d-afca-4bcf-a6af-1a4f4bf37bcc","block_type":"box","text":"With respect to Investor A Shares of BlackRock Managed Income Fund of BlackRock Funds II, the placement fees","page_number":133,"box":{"x":101,"y":493,"width":808,"height":11}},{"id":"2c7a629a-bcfd-4e19-90d6-0898611ef058","block_type":"box","text":"may be up to the following amounts:","page_number":133,"box":{"x":69,"y":508,"width":257,"height":12}},{"id":"019d0130-7c52-4dee-9db7-b802da58cc5f","block_type":"box","text":"$250,000 but less than $3 million . . . . . . . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":535,"width":410,"height":11}},{"id":"f247a5b6-7e37-418e-9d0c-d0391a11c0a3","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":133,"box":{"x":583,"y":536,"width":240,"height":9}},{"id":"8894a183-8f78-4850-a1d1-8ce708152d37","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":550,"width":361,"height":11}},{"id":"d24b7d06-2f1a-4f43-a15b-665293b23f1c","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":133,"box":{"x":535,"y":551,"width":288,"height":9}},{"id":"690ef88a-a93a-4f7a-9027-e592ec03cc34","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":566,"width":345,"height":10}},{"id":"7f4c678d-6d1e-4384-9c74-01a5eb22f6e2","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.15%","page_number":133,"box":{"x":518,"y":566,"width":305,"height":9}},{"id":"c4b0c1fe-0b04-4d0f-914d-ae30cef5ea4d","block_type":"box","text":"With respect to Investor A Shares of BlackRock Inflation Protected Bond Por tfolio of BlackRock Funds V, the","page_number":133,"box":{"x":101,"y":590,"width":768,"height":11}},{"id":"69d11803-6237-4c40-9c5e-3360538e4ce0","block_type":"box","text":"placement fees may be up to the following amounts:","page_number":133,"box":{"x":70,"y":605,"width":371,"height":12}},{"id":"f8131a36-e1e4-4528-8220-058172dc3789","block_type":"box","text":"$1 million but less than $3 million . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":632,"width":361,"height":11}},{"id":"3e1169e5-7f93-4031-983b-e5d9293927a7","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.15%","page_number":133,"box":{"x":535,"y":633,"width":288,"height":9}},{"id":"f0de6617-2a2f-4259-85bf-211b2096537e","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":647,"width":361,"height":11}},{"id":"2b049b44-3bc8-439a-af71-b269f51070d6","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.10%","page_number":133,"box":{"x":535,"y":648,"width":288,"height":9}},{"id":"f9b32ca6-5502-47aa-9710-20d60b390052","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":663,"width":345,"height":10}},{"id":"bebc0c02-f704-4ad1-8df6-457383ddf1e2","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.05%","page_number":133,"box":{"x":518,"y":663,"width":305,"height":9}},{"id":"47f14d65-5285-44b1-b9da-b796eaeab8a2","block_type":"box","text":"With respect to Investor A Shares of BlackRock Low Duration Bond Por tfolio, BlackRock Floating Rate Income","page_number":133,"box":{"x":101,"y":687,"width":778,"height":11}},{"id":"7a05d298-ec0d-409e-821a-49658abb318d","block_type":"box","text":"Por tfolio, BlackRock Income Fund and BlackRock Strategic Income Oppor tunities Por tfolio of BlackRock Funds V, the","page_number":133,"box":{"x":69,"y":702,"width":830,"height":12}},{"id":"d5aba3e1-d88d-4961-a5ae-612c6091d3df","block_type":"box","text":"placement fees may be up to the following amounts:","page_number":133,"box":{"x":70,"y":717,"width":371,"height":12}},{"id":"cd61b476-88e0-498e-9ea1-73a255520374","block_type":"box","text":"$500,000 but less than $3 million . . . . . . . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":744,"width":410,"height":12}},{"id":"84632cc0-addf-403e-9bc9-8ec33b3fa306","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 0.75%","page_number":133,"box":{"x":583,"y":745,"width":240,"height":9}},{"id":"6d7fa186-79ee-457d-bb5c-ec36037bc701","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":760,"width":361,"height":10}},{"id":"c251a254-4c81-4853-9f38-cf0be8532642","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":133,"box":{"x":535,"y":760,"width":288,"height":9}},{"id":"ddbd7cb0-8787-43ae-b4a2-f87f8f255bc2","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":775,"width":345,"height":10}},{"id":"3ce2c182-47a4-46fa-9480-411e7a539841","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":133,"box":{"x":518,"y":775,"width":305,"height":9}},{"id":"931444cb-4b3b-47a0-9f90-8dbb055da5b4","block_type":"box","text":"With respect to Investor A Shares of BlackRock Shor t Duration Muni Fund of BlackRock Municipal Bond Fund,","page_number":133,"box":{"x":101,"y":799,"width":779,"height":11}},{"id":"626b9087-9b4e-44b6-9574-b34c341e6b1a","block_type":"box","text":"Inc. (for shares purchased prior to March 18, 2019), the placement fees may be up to the following amounts:","page_number":133,"box":{"x":70,"y":814,"width":780,"height":12}},{"id":"f504cc51-ec13-4894-ae82-dce35296fa53","block_type":"box","text":"$250,000 and above . . . .","page_number":133,"box":{"x":167,"y":841,"width":182,"height":12}},{"id":"2acb6b80-6c85-409d-8e29-31def16077db","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":133,"box":{"x":355,"y":842,"width":468,"height":9}},{"id":"5e0cd48d-28e9-463a-849a-5052ca46667c","block_type":"box","text":"II-102","page_number":133,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"3eb68775-5c04-46c8-8daa-f387e2bb8eca","block_type":"box","text":"NM1026U-5982568-133/232","page_number":133,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"6901a344-b348-46b8-8f24-24d83d757985","block_type":"box","text":"With respect to Investor A Shares of BlackRock Shor t Duration Muni Fund of BlackRock Municipal Bond Fund,","page_number":134,"box":{"x":101,"y":45,"width":779,"height":11}},{"id":"3fba87a6-356f-4721-89b7-35a2e8263ae4","block_type":"box","text":"Inc. (for shares purchased on or after March 18, 2019 and prior to July 1, 2020), the placement fees may be up to","page_number":134,"box":{"x":70,"y":60,"width":819,"height":11}},{"id":"53577589-ca98-4573-a318-8b7a5e4dbcaf","block_type":"box","text":"the following amounts:","page_number":134,"box":{"x":68,"y":75,"width":161,"height":11}},{"id":"07190bec-f788-4b48-9143-b359dd47e019","block_type":"box","text":"$100,000 and above . . . .","page_number":134,"box":{"x":167,"y":102,"width":182,"height":11}},{"id":"7f620990-6e73-4a63-ab87-f53c6607551c","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":134,"box":{"x":355,"y":103,"width":468,"height":9}},{"id":"48ccfef6-ffbe-4939-9779-7953f087de10","block_type":"box","text":"With respect to Investor A Shares of BlackRock Shor t Duration Muni Fund of BlackRock Municipal Bond Fund,","page_number":134,"box":{"x":101,"y":126,"width":779,"height":11}},{"id":"d649f9a2-b0c0-488f-9214-92850630146f","block_type":"box","text":"Inc. (for shares purchased on or after July 1, 2020), the placement fees may be up to the following amounts:","page_number":134,"box":{"x":70,"y":142,"width":775,"height":11}},{"id":"38eae7f4-259b-43b2-a97c-1b5b8224e530","block_type":"box","text":"$250,000 and above . . . .","page_number":134,"box":{"x":167,"y":169,"width":182,"height":11}},{"id":"8e324d0c-835f-4fb6-951f-52be04bd1f71","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":134,"box":{"x":355,"y":169,"width":468,"height":9}},{"id":"9679948e-1e88-4017-8cba-39f17700c653","block_type":"box","text":"With respect to Investor A Shares of BlackRock Strategic Municipal Oppor tunities Fund of BlackRock Municipal","page_number":134,"box":{"x":101,"y":193,"width":788,"height":12}},{"id":"74de62e7-d59a-4f00-b174-fac0c6f973b3","block_type":"box","text":"Series Trust, BlackRock California Municipal Oppor tunities Fund of BlackRock California Municipal Series Trust,","page_number":134,"box":{"x":69,"y":208,"width":792,"height":11}},{"id":"4c08039d-4780-4469-8c51-e2886d72a0a0","block_type":"box","text":"BlackRock New York Municipal Oppor tunities Fund, BlackRock New Jersey Municipal Bond Fund and BlackRock","page_number":134,"box":{"x":70,"y":224,"width":787,"height":11}},{"id":"be6fec38-9510-4c87-85ef-af65edf20724","block_type":"box","text":"Pennsylvania Municipal Bond Fund of BlackRock Multi-State Municipal Series Trust and BlackRock National Municipal","page_number":134,"box":{"x":69,"y":239,"width":834,"height":11}},{"id":"e66d2da3-1237-4112-8824-bf04f42bbcb5","block_type":"box","text":"Fund of BlackRock Municipal Bond Fund, Inc., the placement fees may be up to the following amounts:","page_number":134,"box":{"x":70,"y":254,"width":729,"height":11}},{"id":"ea396bc8-7cc4-4f45-8e8c-b878963eec67","block_type":"box","text":"$250,000 but less than $4 million . . . . . . . . . . . . . . . . . . . .","page_number":134,"box":{"x":167,"y":281,"width":410,"height":11}},{"id":"29a5280a-15c7-4de1-b814-7eaadf465350","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 1.00%","page_number":134,"box":{"x":583,"y":282,"width":240,"height":8}},{"id":"b09b2f01-88e9-41ea-be38-0403633ed49b","block_type":"box","text":"$4 million but less than $10 million . . . . . . . . . . . . .","page_number":134,"box":{"x":167,"y":296,"width":361,"height":10}},{"id":"74a7bad9-e3cf-4d30-adc3-c42bf4bca6e7","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":134,"box":{"x":535,"y":297,"width":288,"height":9}},{"id":"b70f5a6c-84e3-43bf-bb3f-819d1f788c3b","block_type":"box","text":"$10 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":134,"box":{"x":167,"y":311,"width":345,"height":11}},{"id":"2d283e9b-b2f1-45e0-91e5-9750bb40c3bf","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":134,"box":{"x":518,"y":312,"width":305,"height":9}},{"id":"afd0392f-9c21-46d1-9219-cfaf6361c5ea","block_type":"box","text":"With respect to Investor A Shares of BlackRock Dynamic High Income Por tfolio (for shares purchased on or after","page_number":134,"box":{"x":101,"y":336,"width":801,"height":11}},{"id":"be1cccd0-3622-4956-b244-5711edd128e8","block_type":"box","text":"July 1, 2020) and BlackRock Multi-Asset Income Por tfolio (for shares purchased on or after July 1, 2020) of","page_number":134,"box":{"x":69,"y":351,"width":769,"height":11}},{"id":"28efccb2-07fd-4435-a2b5-45b41031cea1","block_type":"box","text":"BlackRock Funds II, BlackRock Total Return Fund of BlackRock Bond Fund, Inc. and BlackRock Balanced Fund, Inc.,","page_number":134,"box":{"x":70,"y":366,"width":818,"height":10}},{"id":"98b450af-6ec3-48e6-99c7-37aa30c27448","block_type":"box","text":"the placement fees may be up to the following amounts:","page_number":134,"box":{"x":68,"y":381,"width":401,"height":11}},{"id":"2470f797-39a9-4ade-858e-3c4f373689f4","block_type":"box","text":"$250,000 but less than $3 million . . . . . . . . . . . . . . . . . . . .","page_number":134,"box":{"x":167,"y":408,"width":410,"height":11}},{"id":"f8b62760-11d6-4386-9ac7-257b54c7dced","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 0.75%","page_number":134,"box":{"x":583,"y":409,"width":240,"height":9}},{"id":"e15ee346-c704-451e-9e1a-8cdaaf518cbb","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":134,"box":{"x":167,"y":423,"width":361,"height":11}},{"id":"4d685bcc-a6a5-4ba6-94e7-2aaee7c5e03b","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":134,"box":{"x":535,"y":424,"width":288,"height":9}},{"id":"50a680d9-9064-4a48-b3cb-6df888945554","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":134,"box":{"x":167,"y":438,"width":345,"height":11}},{"id":"e5c71eb7-b6d8-4fdd-816f-8096a09f1e56","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":134,"box":{"x":518,"y":439,"width":305,"height":9}},{"id":"a4463c51-9fc3-4d26-a7ac-23082324c6b8","block_type":"box","text":"With respect to Investor P Shares of BlackRock LifePath","page_number":134,"box":{"x":101,"y":463,"width":398,"height":11}},{"id":"92390c86-8a2b-445c-bf95-98d35158bdd6","block_type":"box","text":"®","page_number":134,"box":{"x":500,"y":463,"width":6,"height":5}},{"id":"05cc718f-683b-4c3a-906e-d857c1f26111","block_type":"box","text":"Index 2030 Fund, BlackRock LifePath","page_number":134,"box":{"x":513,"y":463,"width":264,"height":10}},{"id":"c8889037-8898-4293-968b-987619f2a15a","block_type":"box","text":"®","page_number":134,"box":{"x":778,"y":463,"width":6,"height":5}},{"id":"6c1f3005-2543-4109-b627-19ebb05e598f","block_type":"box","text":"Index 2035","page_number":134,"box":{"x":791,"y":463,"width":79,"height":9}},{"id":"ab8c2cb3-a642-44b2-b6bd-5ddc77111107","block_type":"box","text":"Fund, BlackRock LifePath","page_number":134,"box":{"x":70,"y":478,"width":177,"height":11}},{"id":"2e89e765-7dc9-450a-9448-de7c3917b190","block_type":"box","text":"®","page_number":134,"box":{"x":249,"y":478,"width":6,"height":5}},{"id":"72e28f3f-64f5-457d-a421-b8ef0d4b8564","block_type":"box","text":"Index 2040 Fund, BlackRock LifePath","page_number":134,"box":{"x":261,"y":478,"width":265,"height":11}},{"id":"c64038ba-28d8-4d47-b5fb-87e8fce7e56e","block_type":"box","text":"®","page_number":134,"box":{"x":527,"y":478,"width":6,"height":5}},{"id":"a03e9116-f050-43e6-b420-5f485c90ff3e","block_type":"box","text":"Index 2045 Fund, BlackRock LifePath","page_number":134,"box":{"x":539,"y":478,"width":265,"height":11}},{"id":"4b7c43a0-b593-43b4-950c-0db1e2181fed","block_type":"box","text":"®","page_number":134,"box":{"x":805,"y":478,"width":6,"height":5}},{"id":"911c4d35-f4e8-46f4-bdca-a2d22bc84b27","block_type":"box","text":"Index 2050","page_number":134,"box":{"x":817,"y":478,"width":80,"height":9}},{"id":"1a7f9938-8445-4ba2-a2f6-07938f80528c","block_type":"box","text":"Fund, BlackRock LifePath","page_number":134,"box":{"x":70,"y":493,"width":177,"height":11}},{"id":"2bf41101-4f8d-4993-9542-0c5f5f0a296d","block_type":"box","text":"®","page_number":134,"box":{"x":248,"y":494,"width":6,"height":4}},{"id":"97dc9496-4411-469d-beff-e1963ce68219","block_type":"box","text":"Index 2055 Fund, BlackRock LifePath","page_number":134,"box":{"x":261,"y":493,"width":263,"height":11}},{"id":"3a9c10eb-7ee3-4e44-aa4f-275323ac5fa2","block_type":"box","text":"®","page_number":134,"box":{"x":526,"y":494,"width":6,"height":4}},{"id":"abc4b9fb-a6e8-4e4b-8cfe-4badc78da1fc","block_type":"box","text":"Index 2060 Fund, BlackRock LifePath","page_number":134,"box":{"x":538,"y":493,"width":264,"height":11}},{"id":"2e58a436-cf1d-4e28-9299-f270e0b4a669","block_type":"box","text":"®","page_number":134,"box":{"x":803,"y":494,"width":6,"height":4}},{"id":"a96d386c-ee51-4838-aff1-e1579302c250","block_type":"box","text":"Index 2065","page_number":134,"box":{"x":815,"y":493,"width":80,"height":9}},{"id":"f2255b96-cf30-4ba1-9e47-25bf626a610e","block_type":"box","text":"Fund, BlackRock LifePath","page_number":134,"box":{"x":70,"y":508,"width":177,"height":11}},{"id":"ddcee970-7b81-434a-9f1a-320032a5b140","block_type":"box","text":"®","page_number":134,"box":{"x":248,"y":509,"width":6,"height":4}},{"id":"7e0a9722-29c3-4eb5-8ad5-27dda42e8a37","block_type":"box","text":"Index 2070 Fund and BlackRock LifePath","page_number":134,"box":{"x":261,"y":508,"width":290,"height":9}},{"id":"741a2f85-f2be-4350-a682-be7a549e3203","block_type":"box","text":"®","page_number":134,"box":{"x":552,"y":509,"width":6,"height":4}},{"id":"ab751979-d014-4e22-aa8f-99bfd828626a","block_type":"box","text":"Index Retirement Fund of BlackRock Funds III,","page_number":134,"box":{"x":564,"y":508,"width":324,"height":11}},{"id":"59292df2-69fb-4eba-824f-c8bab7312424","block_type":"box","text":"the placement fees may be up to the following amounts:","page_number":134,"box":{"x":68,"y":523,"width":401,"height":12}},{"id":"e0b10d34-56b4-4bf9-9667-a92c364c2204","block_type":"box","text":"$1,000,000 and above . . . . .","page_number":134,"box":{"x":167,"y":550,"width":206,"height":12}},{"id":"3e9fec46-ee40-4677-951b-2c673c11bbf8","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.10%","page_number":134,"box":{"x":380,"y":551,"width":443,"height":9}},{"id":"0eb756be-818a-4a33-ac42-60e032e0a31c","block_type":"box","text":"With respect to Investor P Shares of iShares Municipal Bond Index Fund of BlackRock Funds","page_number":134,"box":{"x":101,"y":575,"width":657,"height":11}},{"id":"a5b4ebe4-3d43-4b90-bcee-edf04cfb40f0","block_type":"box","text":"SM","page_number":134,"box":{"x":760,"y":575,"width":10,"height":5}},{"id":"0733e6c8-df93-4d3a-8e70-14ba634e3607","block_type":"box","text":", the placement","page_number":134,"box":{"x":773,"y":575,"width":110,"height":11}},{"id":"332a033c-67f2-4ddd-890c-2bdc40113679","block_type":"box","text":"fees may be up to the following amounts:","page_number":134,"box":{"x":68,"y":590,"width":294,"height":11}},{"id":"931af691-0168-474d-990f-1b26b1da7a63","block_type":"box","text":"$1,000,000 and above . . . . .","page_number":134,"box":{"x":167,"y":617,"width":206,"height":11}},{"id":"56b3d75c-fd26-4497-a1be-040c7e155cef","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.15%","page_number":134,"box":{"x":380,"y":618,"width":443,"height":9}},{"id":"5cf7672d-aa12-4cda-b8ac-e3e09bac4cfd","block_type":"box","text":"There are no placement fees for Investor P Shares of iShares MSCI EAFE International Index Fund and iShares","page_number":134,"box":{"x":101,"y":642,"width":787,"height":11}},{"id":"ce97e4c9-c96c-4729-8ffe-7b8be5f68441","block_type":"box","text":"Russell 2000 Small-Cap Index Fund of BlackRock Index Funds, Inc. and iShares S&P 500 Index Fund and iShares","page_number":134,"box":{"x":70,"y":657,"width":808,"height":11}},{"id":"a23df24a-ef51-45fb-b597-74ed0eabaf3b","block_type":"box","text":"U.S. Aggregate Bond Index Fund of BlackRock Funds III.","page_number":134,"box":{"x":70,"y":672,"width":393,"height":11}},{"id":"c03ae2db-0434-49aa-b5ba-53fd7b049aea","block_type":"box","text":"For the tables above, the placement fees indicated will apply up to the indicated breakpoint (so that, for","page_number":134,"box":{"x":102,"y":695,"width":740,"height":11}},{"id":"bbe3cf46-5856-44d8-b54c-262bd1c268a8","block_type":"box","text":"example, a sale of $4 million wor th of Investor A Shares of BlackRock Impact Mor tgage Fund of BlackRock Funds V","page_number":134,"box":{"x":69,"y":709,"width":823,"height":12}},{"id":"e2c21936-90e3-4e1f-aae0-0bf2f1debfdb","block_type":"box","text":"will result in a placement fee of up to 0.50% on the first $3 million and a placement fee of 0.25% on the final","page_number":134,"box":{"x":68,"y":724,"width":780,"height":12}},{"id":"c3616d50-745c-4515-a2bd-aa73a6bf030a","block_type":"box","text":"$1 million).","page_number":134,"box":{"x":69,"y":739,"width":79,"height":12}},{"id":"8a13715c-7503-4ffa-9b79-520ae3f55a73","block_type":"box","text":"Other.","page_number":134,"box":{"x":102,"y":763,"width":41,"height":9}},{"id":"b8036f50-6bf1-46cc-80a5-15ec52ec5991","block_type":"box","text":"The following persons may also buy Investor A or Investor P Shares without paying a sales charge:","page_number":134,"box":{"x":149,"y":763,"width":698,"height":11}},{"id":"d148bcb8-fd6a-4f64-bcc7-3ec76b4f5eb1","block_type":"box","text":"(a) cer tain employer-sponsored retirement plans (for purposes of this waiver, employer-sponsored retirement plans do","page_number":134,"box":{"x":69,"y":778,"width":839,"height":11}},{"id":"84f75e50-220c-424f-a623-cffa70d0a3d3","block_type":"box","text":"not include SEP IRAs, SIMPLE IRAs or SARSEPs); (b) rollovers of current investments through cer tain employer","page_number":134,"box":{"x":69,"y":793,"width":790,"height":11}},{"id":"2cac0869-61f8-4860-a305-f669c36e7f21","block_type":"box","text":"sponsored retirement plans provided the shares are transferred to Investor A or Investor P, as applicable, shares of","page_number":134,"box":{"x":69,"y":808,"width":825,"height":11}},{"id":"7258f6e5-14a7-44ab-834c-fa1af41b6fa2","block_type":"box","text":"the same or another BlackRock Fund as either a direct rollover, or subsequent to distribution, the rolled-over","page_number":134,"box":{"x":68,"y":823,"width":773,"height":11}},{"id":"dafc43c1-684e-4fed-9e54-dfaf53d9363c","block_type":"box","text":"proceeds are contributed to a BlackRock IRA through an account directly with the Fund; or purchases by IRA programs","page_number":134,"box":{"x":70,"y":839,"width":838,"height":11}},{"id":"6f3b1413-1168-4afd-96d6-150245a54eea","block_type":"box","text":"that are sponsored by financial intermediary firms provided the financial intermediary firm has entered into a Class A","page_number":134,"box":{"x":68,"y":853,"width":837,"height":12}},{"id":"8fd27b01-d022-4814-ac4f-c1ac01bd1b34","block_type":"box","text":"or Investor P NAV agreement, as applicable, with respect to such program with the Distributor; (c) insurance company","page_number":134,"box":{"x":69,"y":869,"width":836,"height":11}},{"id":"52a67619-d6da-4d64-a392-bdeed4ebba0f","block_type":"box","text":"separate accounts; (d) registered investment advisers, trust companies and bank trust depar tments exercising","page_number":134,"box":{"x":69,"y":884,"width":793,"height":11}},{"id":"3020b9c9-edc0-4bb0-bd0c-30ca1860b013","block_type":"box","text":"discretionary investment authority with respect to amounts to be invested in a Fund; (e) persons par ticipating in a","page_number":134,"box":{"x":69,"y":899,"width":811,"height":11}},{"id":"40beaa80-4201-43e5-84c3-c26eafc2ff28","block_type":"box","text":"II-103","page_number":134,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"23a11990-8a91-4c14-ba11-786d85d5a659","block_type":"box","text":"NM1026U-5982568-134/232","page_number":134,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"eed2cfab-2727-4332-a199-e09adf83e751","block_type":"box","text":"fee-based program (such as a wrap account) under which they pay advisory fees to a broker-dealer or other financial","page_number":135,"box":{"x":68,"y":45,"width":827,"height":11}},{"id":"b1100b8d-f5b2-407d-8946-5a243ad9d7f5","block_type":"box","text":"institution; (f) financial intermediaries who have entered into an agreement with the Distributor and have been","page_number":135,"box":{"x":70,"y":60,"width":782,"height":11}},{"id":"596a5522-812b-41c0-a4bf-93fec989212e","block_type":"box","text":"approved by the Distributor to offer Fund shares to self-directed investment brokerage accounts that may or may not","page_number":135,"box":{"x":69,"y":75,"width":830,"height":11}},{"id":"5dc52653-27ef-4256-ac73-26cc2d494f97","block_type":"box","text":"charge a transaction fee; (g) state sponsored 529 college savings plans and rollovers of such 529 plans into Roth","page_number":135,"box":{"x":69,"y":90,"width":815,"height":11}},{"id":"4a6301e0-51b3-4c8e-9902-7af0406c6c9c","block_type":"box","text":"IRAs as permitted under the Internal Revenue Code; (h) with respect to Investor A Shares only, accounts opened","page_number":135,"box":{"x":70,"y":105,"width":799,"height":11}},{"id":"2c97b229-7544-4e2f-b0b5-ded29aa8420f","block_type":"box","text":"directly with a Fund that do not have a financial intermediary associated with the account; and (i) persons","page_number":135,"box":{"x":69,"y":120,"width":752,"height":11}},{"id":"8ab8de54-5a5a-4e93-b4b2-c7df4403e2ba","block_type":"box","text":"involuntarily liquidated from a Fund, who within 60 days of liquidation buy new shares of another BlackRock Fund (but","page_number":135,"box":{"x":70,"y":135,"width":836,"height":11}},{"id":"826d4857-f8cd-4dc1-bc24-fe4576ceb751","block_type":"box","text":"only up to the amount that was liquidated). The following persons associated with the Funds, the Fund’s Manager,","page_number":135,"box":{"x":69,"y":150,"width":812,"height":12}},{"id":"cebb53d1-3e38-4808-b803-7ae3899a9b0f","block_type":"box","text":"Sub-Advisers, Transfer Agent, Distributor, fund accounting agents, Barclays PLC and their affiliates may buy Investor A","page_number":135,"box":{"x":69,"y":166,"width":840,"height":11}},{"id":"e3bb3a5b-f8f9-45d3-aa62-1a7d259ac4a5","block_type":"box","text":"or Investor P Shares of each of the Funds without paying a sales charge to the extent permitted by these firms","page_number":135,"box":{"x":69,"y":181,"width":788,"height":11}},{"id":"1be9635e-7181-4e30-afee-b60826895d5e","block_type":"box","text":"including: (a) officers, directors and par tners; (b) employees and retirees; (c) employees or registered representatives","page_number":135,"box":{"x":70,"y":196,"width":838,"height":11}},{"id":"69f112e4-b20d-40fb-be3d-c2f26f1789b9","block_type":"box","text":"of firms who have entered into selling agreements to distribute shares of BlackRock-advised funds; (d) immediate","page_number":135,"box":{"x":69,"y":211,"width":810,"height":11}},{"id":"6691188e-0bc8-488b-a226-e3d33e963219","block_type":"box","text":"family members of such persons (“immediate family members” shall be defined as the investor, the investor’s","page_number":135,"box":{"x":68,"y":226,"width":787,"height":11}},{"id":"8e8c7b0e-3812-4876-be16-8d7d968be7dd","block_type":"box","text":"spouse or domestic par tner, children, parents and siblings); and (e) any trust, pension, profit-sharing or other benefit","page_number":135,"box":{"x":69,"y":241,"width":834,"height":11}},{"id":"5bbe6e17-253e-4dd5-b36c-d54fa12caa57","block_type":"box","text":"plan for any of the persons set for th in (a) through (d). Investors who qualify for any of these exemptions from the","page_number":135,"box":{"x":70,"y":256,"width":808,"height":12}},{"id":"7613d4a0-9bf6-4202-86b0-77b0bc7273bd","block_type":"box","text":"sales charge should purchase Investor A or Investor P Shares. In addition, a sales charge waiver may be available for","page_number":135,"box":{"x":69,"y":271,"width":837,"height":12}},{"id":"9835567b-e47e-4cdb-8065-05f27f04f954","block_type":"box","text":"investors exchanging Investor A Shares of one BlackRock Fund for Investor P Shares of another BlackRock Fund, or","page_number":135,"box":{"x":70,"y":286,"width":820,"height":12}},{"id":"20e5dbf4-a49e-4fe8-a55a-bfc5ce55a512","block_type":"box","text":"exchanging Investor P Shares of one BlackRock Fund for Investor A Shares of another BlackRock Fund, through an","page_number":135,"box":{"x":69,"y":302,"width":813,"height":11}},{"id":"37bf6b56-e809-4b63-b9ae-ab244164ef20","block_type":"box","text":"intermediary-processed exchange, provided that the investor had previously paid a sales charge with respect to such","page_number":135,"box":{"x":70,"y":317,"width":831,"height":11}},{"id":"797880aa-afb3-40da-89b6-4b82e63779fa","block_type":"box","text":"shares. The availability of Investor A or Investor P Shares sales charge waivers may depend upon the policies,","page_number":135,"box":{"x":69,"y":332,"width":783,"height":11}},{"id":"8a42eba1-9a16-4450-b9c8-2d245cfcb47f","block_type":"box","text":"procedures and trading platforms of your financial intermediary; consult your financial adviser.","page_number":135,"box":{"x":70,"y":347,"width":668,"height":11}},{"id":"45b5420b-15aa-4e30-bc50-692fe3c6c9bc","block_type":"box","text":"If you invest $1,000,000 ($250,000 for BlackRock Dynamic High Income Por tfolio, BlackRock Multi-Asset","page_number":135,"box":{"x":102,"y":369,"width":754,"height":12}},{"id":"33c7abea-0b30-4dfb-9e9d-97c2d8722e64","block_type":"box","text":"Income Por tfolio and BlackRock Managed Income Fund of BlackRock Funds II, BlackRock Credit Relative Value Fund","page_number":135,"box":{"x":70,"y":385,"width":823,"height":11}},{"id":"47f1c026-108a-40d5-ae7a-c3cd183326ec","block_type":"box","text":"of BlackRock Funds IV, BlackRock Total Return Fund of BlackRock Bond Fund, Inc., BlackRock Global Allocation Fund,","page_number":135,"box":{"x":69,"y":400,"width":833,"height":10}},{"id":"6088dd35-a2a1-49af-9b6b-991e26907fe4","block_type":"box","text":"Inc., BlackRock National Municipal Fund of BlackRock Municipal Bond Fund, Inc., BlackRock Shor t Duration Muni","page_number":135,"box":{"x":70,"y":415,"width":802,"height":11}},{"id":"4f54466d-0721-4679-9088-0a86751d9a5f","block_type":"box","text":"Fund of BlackRock Municipal Bond Fund, Inc., BlackRock Strategic Municipal Oppor tunities Fund of BlackRock","page_number":135,"box":{"x":70,"y":430,"width":781,"height":11}},{"id":"05445e43-d51c-4e49-9c9d-e98fdc925fdf","block_type":"box","text":"Municipal Series Trust, BlackRock California Municipal Oppor tunities Fund of BlackRock California Municipal Series","page_number":135,"box":{"x":70,"y":445,"width":819,"height":11}},{"id":"2d9a03c8-5e1b-443a-a42c-82f45ddcda3d","block_type":"box","text":"Trust, BlackRock New York Municipal Oppor tunities Fund, BlackRock New Jersey Municipal Bond Fund and BlackRock","page_number":135,"box":{"x":68,"y":460,"width":835,"height":12}},{"id":"1beb5a3a-ad90-434a-80bc-6644d4276d79","block_type":"box","text":"Pennsylvania Municipal Bond Fund of BlackRock Multi-State Municipal Series Trust, BlackRock Event Driven Equity","page_number":135,"box":{"x":69,"y":475,"width":813,"height":12}},{"id":"674d2ed5-d81c-4b31-ab79-5b98b67278fd","block_type":"box","text":"Fund and BlackRock Balanced Fund, Inc., and $500,000 for BlackRock Low Duration Bond Por tfolio, BlackRock","page_number":135,"box":{"x":70,"y":490,"width":792,"height":11}},{"id":"cea05564-d394-4de3-812b-e2a5f156a492","block_type":"box","text":"Floating Rate Income Por tfolio, BlackRock Income Fund and BlackRock Strategic Income Oppor tunities Por tfolio of","page_number":135,"box":{"x":70,"y":506,"width":813,"height":11}},{"id":"6318f3f6-3df0-482f-82d9-d30ebc48586d","block_type":"box","text":"BlackRock Funds V) or more in Investor A or Investor P Shares, as applicable, you may not pay an initial sales charge.","page_number":135,"box":{"x":70,"y":521,"width":837,"height":11}},{"id":"7fd7fe54-90c2-490a-8e2d-7f6fa3e1f625","block_type":"box","text":"However, if you redeem your Investor A or Investor P Shares, as applicable, within 18 months after purchase (a","page_number":135,"box":{"x":70,"y":536,"width":790,"height":11}},{"id":"38ae3f2f-4ee5-4453-92dc-bdbbc692d75d","block_type":"box","text":"shor ter holding period may apply depending on the Fund), you may be charged a deferred sales charge.","page_number":135,"box":{"x":69,"y":551,"width":736,"height":11}},{"id":"d4d30ae3-1379-401b-8242-fb0a6f5afa95","block_type":"box","text":"A deferred sales charge of up to 1.00% may apply to cer tain redemptions of Investor A Shares of the Index","page_number":135,"box":{"x":101,"y":574,"width":763,"height":11}},{"id":"bbf8dc03-e49d-41fb-99aa-8a9d1d79cd62","block_type":"box","text":"Funds and BlackRock Shor t Obligations Fund purchased in an exchange transaction for Investor A Shares of a","page_number":135,"box":{"x":70,"y":589,"width":782,"height":11}},{"id":"a7ababe6-83c0-4130-a724-50a39e7e5010","block_type":"box","text":"por tfolio advised by BlackRock or its affiliates where no initial sales charge was paid at the time of purchase of such","page_number":135,"box":{"x":70,"y":604,"width":832,"height":11}},{"id":"7578074c-79ba-41be-977e-e5ef006fa843","block_type":"box","text":"fund (an “Investor A Load-Waived BlackRock Por tfolio”) as par t of an investment of $1,000,000 (lesser amounts may","page_number":135,"box":{"x":68,"y":618,"width":839,"height":12}},{"id":"d93a5e79-2c8b-4f0d-b39d-474703d5844a","block_type":"box","text":"apply depending on the Investor A Load-Waived BlackRock Por tfolio) or more. The Investor A Shares deferred sales","page_number":135,"box":{"x":69,"y":634,"width":817,"height":12}},{"id":"98ae0e27-9146-4f16-87c9-ac66703ee508","block_type":"box","text":"charge is only charged upon redemptions of Investor A Shares within 18 months after you originally acquired such","page_number":135,"box":{"x":69,"y":649,"width":811,"height":12}},{"id":"91723173-beb2-4282-ad2c-81aec16b1cb7","block_type":"box","text":"Investor A Shares of the Investor A Load-Waived BlackRock Por tfolio (a shor ter holding period may apply depending","page_number":135,"box":{"x":70,"y":664,"width":818,"height":12}},{"id":"6296430d-290b-4388-b87f-4debf19ca395","block_type":"box","text":"on the Investor A Load-Waived BlackRock Por tfolio), unless you qualify for a waiver. There is no deferred sales charge","page_number":135,"box":{"x":69,"y":680,"width":836,"height":11}},{"id":"df9b4b8c-a7a2-4003-ac09-3329b61852fb","block_type":"box","text":"charged on redemptions if you have owned your Investor A Shares for more than 18 months (or for a shor ter holding","page_number":135,"box":{"x":69,"y":695,"width":830,"height":11}},{"id":"496431b7-9025-484e-974f-d6f2529294c3","block_type":"box","text":"period, as applicable) (as measured from your original purchase of Investor A Shares that you exchanged into","page_number":135,"box":{"x":70,"y":710,"width":778,"height":11}},{"id":"4f884023-e697-4060-98b0-7d351d5665f9","block_type":"box","text":"Investor A Shares of the Index Fund or BlackRock Shor t Obligations Fund).","page_number":135,"box":{"x":70,"y":725,"width":526,"height":11}},{"id":"6e18f366-33c3-4429-be4c-07d6b5116565","block_type":"box","text":"The deferred sales charge on Investor A or Investor P Shares, as applicable, is not charged in connection with:","page_number":135,"box":{"x":101,"y":748,"width":788,"height":11}},{"id":"8afe73f0-be9d-4a01-a2ed-7e91a9aae171","block_type":"box","text":"(a) redemptions of Investor A or Investor P Shares purchased through cer tain employer-sponsored retirement plans","page_number":135,"box":{"x":69,"y":763,"width":819,"height":11}},{"id":"1cd218b0-56d0-4ae7-8304-a86f014d5a7a","block_type":"box","text":"and rollovers of current investments in a Fund through such plans; (b) exchanges described in “Exchange Privilege”","page_number":135,"box":{"x":69,"y":778,"width":820,"height":11}},{"id":"c0563d44-b9d9-4586-aeff-d3b7c5ec005e","block_type":"box","text":"below; (c) redemptions made in connection with minimum required distributions from IRA and 403(b)(7) accounts due","page_number":135,"box":{"x":69,"y":793,"width":837,"height":11}},{"id":"198b2489-4083-4603-8f02-0850cd9046e4","block_type":"box","text":"to the shareholder reaching the applicable age triggering such distributions; (d) redemptions made with respect to","page_number":135,"box":{"x":68,"y":808,"width":812,"height":11}},{"id":"7b0c4a25-e94b-434f-9625-1cc94d52026e","block_type":"box","text":"cer tain retirement plans sponsored by a Fund, BlackRock or its affiliates; (e) redemptions (i) within one year of a","page_number":135,"box":{"x":69,"y":823,"width":803,"height":11}},{"id":"5ec757e4-34dc-4a4c-aa36-6b168950eae7","block_type":"box","text":"shareholder’s death or, if later, the receipt of a cer tified probate settlement (including in connection with the","page_number":135,"box":{"x":69,"y":838,"width":772,"height":12}},{"id":"e390cc20-a994-4df4-bf6a-faa166ef0ce0","block_type":"box","text":"distribution of account assets to a beneficiary of the decedent) or (ii) in connection with a shareholder’s disability (as","page_number":135,"box":{"x":69,"y":853,"width":835,"height":12}},{"id":"d7e08594-b607-4efc-815c-1415943e28df","block_type":"box","text":"defined in the Code) subsequent to the purchase of Investor A or Investor P Shares; (f) involuntary redemptions of","page_number":135,"box":{"x":69,"y":869,"width":814,"height":11}},{"id":"d98f90be-f41d-432f-990d-729552f69c8c","block_type":"box","text":"Investor A or Investor P Shares in accounts with low balances; (g) cer tain redemptions made pursuant to the","page_number":135,"box":{"x":70,"y":884,"width":772,"height":11}},{"id":"2974f4e9-6a87-46f4-a284-9bbdfd1db68b","block_type":"box","text":"Systematic Withdrawal Plan (described below); (h) redemptions related to the payment of BNY Mellon Investment","page_number":135,"box":{"x":69,"y":899,"width":805,"height":11}},{"id":"59b7c704-5b29-4393-bb78-a62ac9f9935d","block_type":"box","text":"II-104","page_number":135,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"3761d112-c8b4-41ba-9ab6-fc7e63518e02","block_type":"box","text":"NM1026U-5982568-135/232","page_number":135,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"b4a221b8-8971-4fd4-97b0-ec69727a8bbf","block_type":"box","text":"Servicing Trust Company custodial IRA fees; and (i) redemptions when a shareholder can demonstrate hardship, in","page_number":136,"box":{"x":69,"y":45,"width":817,"height":11}},{"id":"1e087649-88b9-4059-9d61-52efb0e85c60","block_type":"box","text":"the absolute discretion of a Fund.","page_number":136,"box":{"x":68,"y":60,"width":239,"height":9}},{"id":"b2b6b0d7-1dac-464c-a991-0ed75948b6d4","block_type":"box","text":"With respect to cer tain employer-sponsored retirement plans, if a dealer waives its right to receive a placement","page_number":136,"box":{"x":101,"y":82,"width":794,"height":12}},{"id":"5adaedfc-c722-46d7-baab-18512148c02e","block_type":"box","text":"fee, the Fund may, at its own discretion, waive the CDSC related to purchases of $1,000,000 ($250,000 for","page_number":136,"box":{"x":68,"y":97,"width":776,"height":12}},{"id":"8b9cf853-9d78-4bc2-9c91-5ebf0972c11e","block_type":"box","text":"BlackRock Dynamic High Income Por tfolio, BlackRock Multi-Asset Income Por tfolio and BlackRock Managed Income","page_number":136,"box":{"x":70,"y":113,"width":821,"height":11}},{"id":"3299cda0-a027-4651-bc49-ffb3a18607e8","block_type":"box","text":"Fund of BlackRock Funds II, BlackRock Credit Relative Value Fund of BlackRock Funds IV, BlackRock Total Return","page_number":136,"box":{"x":70,"y":128,"width":800,"height":10}},{"id":"f4368542-4975-49a0-b255-f6cc5ae72b9a","block_type":"box","text":"Fund of BlackRock Bond Fund, Inc., BlackRock Global Allocation Fund, Inc., BlackRock National Municipal Fund of","page_number":136,"box":{"x":70,"y":143,"width":806,"height":11}},{"id":"2c0887d0-bac8-4e88-b734-05c479a0d20a","block_type":"box","text":"BlackRock Municipal Bond Fund, Inc., BlackRock Shor t Duration Muni Fund of BlackRock Municipal Bond Fund, Inc.,","page_number":136,"box":{"x":70,"y":158,"width":823,"height":11}},{"id":"3958eafa-6927-46e9-8002-8351c5cc1771","block_type":"box","text":"BlackRock Strategic Municipal Oppor tunities Fund of BlackRock Municipal Series Trust, BlackRock California","page_number":136,"box":{"x":70,"y":173,"width":770,"height":11}},{"id":"01515c55-571f-4427-a2e3-65e850ccce93","block_type":"box","text":"Municipal Oppor tunities Fund of BlackRock California Municipal Series Trust, BlackRock New York Municipal","page_number":136,"box":{"x":70,"y":188,"width":766,"height":11}},{"id":"0f8ae91d-725b-4c8d-9bde-fcb82301ec2c","block_type":"box","text":"Oppor tunities Fund, BlackRock New Jersey Municipal Bond Fund and BlackRock Pennsylvania Municipal Bond Fund of","page_number":136,"box":{"x":69,"y":203,"width":837,"height":12}},{"id":"750f0141-13a4-46bb-a977-8d4250579665","block_type":"box","text":"BlackRock Multi-State Municipal Series Trust, BlackRock Event Driven Equity Fund and BlackRock Balanced Fund,","page_number":136,"box":{"x":70,"y":219,"width":805,"height":11}},{"id":"f637668d-f980-4283-a3f4-be336ac33860","block_type":"box","text":"Inc., and $500,000 for BlackRock Low Duration Bond Por tfolio, BlackRock Floating Rate Income Por tfolio, BlackRock","page_number":136,"box":{"x":70,"y":233,"width":832,"height":12}},{"id":"8d9fa9b2-567c-4d16-85c0-804af5376710","block_type":"box","text":"Income Fund and BlackRock Strategic Income Oppor tunities Por tfolio of BlackRock Funds V) or more of Investor A or","page_number":136,"box":{"x":70,"y":249,"width":828,"height":11}},{"id":"caee87d4-6b7a-4cb4-9c1d-d946ebee2f2f","block_type":"box","text":"Investor P Shares. This may depend upon the policies, procedures and trading platforms of your financial","page_number":136,"box":{"x":70,"y":264,"width":746,"height":11}},{"id":"b83ae8c8-bbc6-4a2d-b6ef-2715096fa392","block_type":"box","text":"intermediary; consult your financial adviser.","page_number":136,"box":{"x":70,"y":279,"width":307,"height":11}},{"id":"41f734e0-8b38-4e23-89bf-d74c3c1113eb","block_type":"box","text":"Investor A and Investor P Shares are also available at NAV to investors that, for regulatory reasons, are required","page_number":136,"box":{"x":102,"y":302,"width":799,"height":11}},{"id":"ce4d9056-a84d-41af-a72a-f2274a30fc57","block_type":"box","text":"to transfer investment positions from a foreign registered investment company advised by BlackRock or its affiliates","page_number":136,"box":{"x":68,"y":317,"width":829,"height":11}},{"id":"fecaa3bc-4bd9-441d-b212-aeb7bd2522fa","block_type":"box","text":"to a U.S. registered BlackRock-advised fund.","page_number":136,"box":{"x":68,"y":332,"width":317,"height":11}},{"id":"4389681f-7838-4285-ad0d-660dbc490fb1","block_type":"box","text":"Acquisition of Cer tain Investment Companies.","page_number":136,"box":{"x":101,"y":355,"width":326,"height":11}},{"id":"4ffbf9c3-3d2c-4558-a08a-21cb0f24c803","block_type":"box","text":"Investor A and Investor P Shares may be offered at NAV in","page_number":136,"box":{"x":434,"y":355,"width":413,"height":11}},{"id":"2c631866-6e16-41b0-896a-257bcc16e7b9","block_type":"box","text":"connection with the acquisition of the assets of, or merger or consolidation with, a personal holding company or a","page_number":136,"box":{"x":69,"y":370,"width":811,"height":11}},{"id":"6186c8f9-af10-42de-96c1-fd85bdb73b37","block_type":"box","text":"public or private investment company.","page_number":136,"box":{"x":70,"y":385,"width":266,"height":11}},{"id":"abbf4e0e-03b9-4e76-9fc0-d06b8b6ab771","block_type":"box","text":"Purchases Through Cer tain Financial Intermediaries.","page_number":136,"box":{"x":102,"y":408,"width":372,"height":11}},{"id":"b2f47992-2d55-4a3b-9e3a-36a711750307","block_type":"box","text":"Reduced sales charges may be applicable for purchases of","page_number":136,"box":{"x":481,"y":407,"width":421,"height":12}},{"id":"cd29ead7-00d9-4371-9b73-8aca515b30e5","block_type":"box","text":"Investor A, Investor A1 or Investor P Shares of a Fund through cer tain financial advisers, selected securities dealers","page_number":136,"box":{"x":70,"y":423,"width":825,"height":11}},{"id":"b3626099-99b5-4f37-900f-2635ee130c87","block_type":"box","text":"and other financial intermediaries that meet and adhere to standards established by the Manager from time to time.","page_number":136,"box":{"x":69,"y":438,"width":830,"height":11}},{"id":"be23ea14-548c-4e2a-b8ee-f9015c6e4349","block_type":"box","text":"Deferred Sales Charge Alternative — Investor C Shares","page_number":136,"box":{"x":69,"y":468,"width":405,"height":11}},{"id":"b23e622c-80a6-41aa-a4b4-9d04a227f14b","block_type":"box","text":"Investors choosing the deferred sales charge alternative should consider Investor C Shares if they are uncer tain","page_number":136,"box":{"x":102,"y":491,"width":799,"height":11}},{"id":"ddc0554d-1bc0-4158-9bbd-fa66c102234b","block_type":"box","text":"as to the length of time they intend to hold their assets in a Fund. If you select Investor C Shares, you do not pay an","page_number":136,"box":{"x":69,"y":506,"width":828,"height":11}},{"id":"813ea82e-8ee2-424b-abb0-e8a981fcef1e","block_type":"box","text":"initial sales charge at the time of purchase. A Fund will not accept a purchase order of $500,000 or more for","page_number":136,"box":{"x":70,"y":520,"width":778,"height":12}},{"id":"23c4ca2e-2fcb-4d2c-81f5-ea1844c18997","block_type":"box","text":"Investor C Shares (may be lower on funds that have set a lower breakpoint for NAV). Your financial intermediary may","page_number":136,"box":{"x":70,"y":536,"width":826,"height":11}},{"id":"7a156f2b-3c20-4d92-bfd0-675f80961bb9","block_type":"box","text":"set a lower maximum for Investor C Shares.","page_number":136,"box":{"x":69,"y":551,"width":311,"height":9}},{"id":"86c97437-5d89-4969-a4eb-18d864ab8ee8","block_type":"box","text":"Investor C Shares are not available in accounts opened or held directly with a Fund that do not have a financial","page_number":136,"box":{"x":102,"y":574,"width":789,"height":11}},{"id":"f3b2bd69-913a-44d0-b5c3-194b72348167","block_type":"box","text":"intermediary associated with the account.","page_number":136,"box":{"x":70,"y":589,"width":297,"height":11}},{"id":"9c55f8cb-b0ff-4ec0-a4f0-fa8b0dc55c69","block_type":"box","text":"If you select Investor C Shares, you do not pay an initial sales charge at the time of purchase.","page_number":136,"box":{"x":102,"y":612,"width":669,"height":11}},{"id":"e695baf1-2bd4-4e0e-a529-169e29dd051c","block_type":"box","text":"The deferred sales charge alternatives may be par ticularly appealing to investors who do not qualify for the","page_number":136,"box":{"x":101,"y":634,"width":763,"height":12}},{"id":"9e7f9f16-1b6c-4889-856b-db9bcab2867f","block_type":"box","text":"reduction in initial sales charges. CDSC shares are subject to ongoing service fees and distribution fees; however,","page_number":136,"box":{"x":69,"y":649,"width":815,"height":12}},{"id":"22f91ebe-c081-4cb1-a925-b3df8da631de","block_type":"box","text":"these fees potentially may be offset to the extent any return is realized on the additional funds initially invested in","page_number":136,"box":{"x":68,"y":664,"width":813,"height":12}},{"id":"f8ce5b7f-8406-4e40-a918-d200dc47262b","block_type":"box","text":"CDSC shares.","page_number":136,"box":{"x":69,"y":680,"width":97,"height":9}},{"id":"f45bb785-02e0-48d9-a2e0-7d1c60f563fa","block_type":"box","text":"BlackRock compensates financial advisers and other financial intermediaries for selling CDSC shares at the time","page_number":136,"box":{"x":102,"y":702,"width":804,"height":12}},{"id":"a2b87ffb-24ca-409d-a6cf-241ea26064a7","block_type":"box","text":"of purchase from its own funds. Proceeds from the CDSC and the distribution fee are paid to the Distributor and are","page_number":136,"box":{"x":69,"y":717,"width":827,"height":11}},{"id":"61e85782-5de5-4493-ae06-45923d4d4718","block_type":"box","text":"used by the Distributor to defray the expenses of securities dealers or other financial intermediaries related to","page_number":136,"box":{"x":69,"y":732,"width":786,"height":12}},{"id":"d9762665-1786-447c-a22a-14160bdd52e6","block_type":"box","text":"providing distribution-related services to each Fund in connection with the sale of the CDSC shares. The combination","page_number":136,"box":{"x":70,"y":748,"width":831,"height":11}},{"id":"204a750d-c05d-4940-9699-d5c058e0260e","block_type":"box","text":"of the CDSC and the ongoing distribution fee facilitates the ability of each Fund to sell the CDSC shares without a","page_number":136,"box":{"x":69,"y":763,"width":809,"height":11}},{"id":"a237eeb7-5ce9-4ead-84cc-0cc667625e99","block_type":"box","text":"sales charge being deducted at the time of purchase. See “Distribution and/or Shareholder Servicing Plans” below.","page_number":136,"box":{"x":69,"y":778,"width":824,"height":11}},{"id":"5e122973-002e-4ebf-8651-a2ecd1bb5f54","block_type":"box","text":"Imposition of the CDSC and the distribution fee on CDSC shares is limited by FINRA (as defined below) asset-based","page_number":136,"box":{"x":70,"y":793,"width":822,"height":11}},{"id":"8196e7fa-debe-4c76-be2b-1248a828c7a6","block_type":"box","text":"sales charge rule. See “Limitations on the Payment of Deferred Sales Charges” below.","page_number":136,"box":{"x":69,"y":808,"width":618,"height":11}},{"id":"157ec9ba-a6a3-4e4e-8118-8f056d144f69","block_type":"box","text":"Dealers will generally immediately receive commissions equal to 1.00% of the Investor C Shares sold by them","page_number":136,"box":{"x":102,"y":831,"width":782,"height":11}},{"id":"35b79526-cb99-431b-9969-1899fea82cd1","block_type":"box","text":"plus ongoing fees under the Fund’s Distribution and Service Plan. Dealers may not receive a commission in","page_number":136,"box":{"x":70,"y":846,"width":764,"height":11}},{"id":"58a1532d-35e6-425f-ba11-9365ab37133a","block_type":"box","text":"connection with sales of Investor C Shares to cer tain employer-sponsored retirement plans sponsored by the Fund,","page_number":136,"box":{"x":69,"y":861,"width":820,"height":11}},{"id":"9d602736-cbd5-4781-a8b6-7057b3b26cce","block_type":"box","text":"BlackRock or its affiliates, but may receive fees under the Distribution and Service Plan. These commissions and","page_number":136,"box":{"x":70,"y":876,"width":806,"height":11}},{"id":"fd31a31c-1c6d-4a85-8516-f32ee644bb05","block_type":"box","text":"payments may be different than the reallowances, placement fees and commissions paid to dealers in connection","page_number":136,"box":{"x":70,"y":891,"width":813,"height":11}},{"id":"2a7f14c8-6b59-4b49-a26e-f7718dcbdbdc","block_type":"box","text":"II-105","page_number":136,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"6b473084-0a17-4279-8530-685d33aecd91","block_type":"box","text":"NM1026U-5982568-136/232","page_number":136,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"af418852-9500-46e6-8a17-36a94b86822e","block_type":"box","text":"with sales of Investor A, Investor A1 and Investor P Shares. These may depend upon the policies, procedures and","page_number":137,"box":{"x":68,"y":45,"width":811,"height":11}},{"id":"2dcb4390-b5a5-4cda-b0ea-a46ad8f06bef","block_type":"box","text":"trading platforms of your financial intermediary; consult your financial adviser.","page_number":137,"box":{"x":68,"y":60,"width":554,"height":11}},{"id":"bf24eb6b-bfe7-4e09-9491-612df1313c78","block_type":"box","text":"Each Fund has adopted an automatic conversion feature for Investor C Shares. Effective November 23, 2020,","page_number":137,"box":{"x":102,"y":82,"width":783,"height":11}},{"id":"990c3daf-a10e-49b0-8ef7-8380f71b7c66","block_type":"box","text":"Investor C Shares held for approximately eight years will be conver ted into Investor A Shares, as set for th in each","page_number":137,"box":{"x":70,"y":98,"width":808,"height":11}},{"id":"53b3fd98-b69d-4d6b-bd68-38ea3c8e9163","block_type":"box","text":"Fund’s Prospectus. In addition, accounts that do not have a financial intermediary associated with them are not","page_number":137,"box":{"x":70,"y":113,"width":797,"height":11}},{"id":"d3106f1b-670d-4cc5-917f-cee9a168c49e","block_type":"box","text":"eligible to hold Investor C Shares, and any Investor C Shares held in such accounts will be automatically conver ted to","page_number":137,"box":{"x":69,"y":128,"width":837,"height":11}},{"id":"931c7dc8-378b-4777-9bc4-4dca8b6938be","block_type":"box","text":"Investor A Shares.","page_number":137,"box":{"x":70,"y":143,"width":128,"height":9}},{"id":"b8ab9775-50b9-4cec-b500-0efee1d1df0c","block_type":"box","text":"Conversion of Investor C Shares to Investor A Shares","page_number":137,"box":{"x":102,"y":166,"width":378,"height":9}},{"id":"79242774-3572-44db-9e49-8001acdcf0eb","block_type":"box","text":"Effective November 23, 2020 (the “Effective Date”), approximately eight years after purchase, Investor C Shares","page_number":137,"box":{"x":102,"y":188,"width":804,"height":12}},{"id":"f40ebd25-33fe-4560-b5d5-b25586025239","block_type":"box","text":"of each Fund will conver t automatically into Investor A Shares of that Fund (the “Investor C 8-Year Conversion”).","page_number":137,"box":{"x":69,"y":203,"width":794,"height":12}},{"id":"f93025c4-8244-404a-898f-fdd946abf961","block_type":"box","text":"Cer tain funds (the “Predecessor Funds”) were reorganized into new Funds (the “Successor Funds”) pursuant to","page_number":137,"box":{"x":69,"y":218,"width":794,"height":12}},{"id":"daffb0ab-9477-435d-91a9-44cdf36018c7","block_type":"box","text":"reorganizations which occurred in September 2018. The holding period for Investor C Shares of Successor Funds","page_number":137,"box":{"x":69,"y":234,"width":806,"height":11}},{"id":"bf4d6da8-8e9e-44ca-a787-9ca9bf97eb2e","block_type":"box","text":"includes the period such shares were held in the respective Predecessor Fund. It is the financial intermediary’s","page_number":137,"box":{"x":70,"y":249,"width":793,"height":11}},{"id":"917967db-4003-486e-85a0-0fe44eb00dcc","block_type":"box","text":"responsibility to ensure that the shareholder is credited with the proper holding period. As of the Effective Date,","page_number":137,"box":{"x":69,"y":264,"width":796,"height":11}},{"id":"959b8d76-f5c9-4b1b-a042-a33e29c985a1","block_type":"box","text":"cer tain financial intermediaries, including group retirement recordkeeping platforms, may not have been tracking","page_number":137,"box":{"x":69,"y":279,"width":802,"height":11}},{"id":"9ab55524-be18-4262-9be7-6a3f4358132f","block_type":"box","text":"such holding periods and therefore may not be able to process such conversions. In such instances, Investor C","page_number":137,"box":{"x":69,"y":294,"width":793,"height":11}},{"id":"cfac307f-907e-4833-afd9-a57329aaa071","block_type":"box","text":"Shares held as of the Effective Date will automatically conver t to Investor A Shares approximately eight years after","page_number":137,"box":{"x":69,"y":309,"width":817,"height":11}},{"id":"b0b684b0-ed28-4d59-8700-265f2f1254ed","block_type":"box","text":"the Effective Date. If, as of November 23, 2028 (eight years after the Effective Date), a financial intermediary has","page_number":137,"box":{"x":68,"y":324,"width":814,"height":12}},{"id":"705ef042-7f28-4864-914a-726fcab495c7","block_type":"box","text":"not implemented systems or procedures to track holding periods commencing from the Effective Date, shareholders","page_number":137,"box":{"x":69,"y":339,"width":828,"height":12}},{"id":"f559e9f1-5383-4faa-bbf2-c83f2e6099f3","block_type":"box","text":"holding Investor C Shares through such financial intermediary will no longer be eligible to hold Investor C Shares and","page_number":137,"box":{"x":69,"y":355,"width":832,"height":11}},{"id":"40d7dba2-4a4b-40fc-af36-baf67048844f","block_type":"box","text":"any such shares will conver t to Investor A Shares as soon as reasonably practicable after such date.","page_number":137,"box":{"x":69,"y":370,"width":718,"height":11}},{"id":"bacfa329-f65c-4714-9028-8dddcd62bd5e","block_type":"box","text":"In addition, accounts that do not have a financial intermediary associated with them are not eligible to hold","page_number":137,"box":{"x":102,"y":392,"width":764,"height":12}},{"id":"8a390d4c-3dbc-4569-877d-2dc173a8e8dd","block_type":"box","text":"Investor C Shares, and any Investor C Shares held in such accounts will be automatically conver ted into Investor A","page_number":137,"box":{"x":70,"y":408,"width":816,"height":11}},{"id":"e990f129-8ecf-4819-8dba-77cf556da6cd","block_type":"box","text":"Shares (the “Investor C Direct Accounts Conversion” and together with the Investor C 8-Year Conversion, the","page_number":137,"box":{"x":69,"y":423,"width":772,"height":11}},{"id":"19ef61f0-2bac-4cd5-ae9d-a92c58556392","block_type":"box","text":"“Investor C Conversions”).","page_number":137,"box":{"x":70,"y":438,"width":186,"height":11}},{"id":"97fe8d2e-05cb-4d3a-848f-ffa84124eb28","block_type":"box","text":"The Investor C Conversions will occur at least once each month (on the “Investor C Conversion Date”) on the","page_number":137,"box":{"x":101,"y":460,"width":776,"height":11}},{"id":"f918b1b8-c85f-465d-9793-6ab039f70778","block_type":"box","text":"basis of the relative NAV of the shares of the two applicable classes on the Investor C Conversion Date, without the","page_number":137,"box":{"x":69,"y":475,"width":824,"height":11}},{"id":"2924dca7-c01a-4ad7-bd63-7690f75e4013","block_type":"box","text":"imposition of any sales load, fee or other charge. The Investor C Conversions will not be deemed a purchase or sale","page_number":137,"box":{"x":70,"y":491,"width":827,"height":11}},{"id":"ff0edcf3-2c18-46d5-932d-6665f0852854","block_type":"box","text":"of the shares for U.S. federal income tax purposes. Shares acquired through reinvestment of dividends on Investor C","page_number":137,"box":{"x":69,"y":506,"width":833,"height":11}},{"id":"01baebca-4c9e-4358-858c-a9a7172755b6","block_type":"box","text":"Shares will also conver t automatically to Investor A Shares, as set for th in each Fund’s Prospectus. The Investor C","page_number":137,"box":{"x":69,"y":521,"width":818,"height":11}},{"id":"197d7eac-2e85-4260-98cc-2f69dda313fe","block_type":"box","text":"Conversion Date for dividend reinvestment shares will be calculated taking into account the length of time the shares","page_number":137,"box":{"x":69,"y":536,"width":836,"height":11}},{"id":"12198b40-e061-4d49-a398-161cac7c3a28","block_type":"box","text":"underlying the dividend reinvestment shares were outstanding.","page_number":137,"box":{"x":69,"y":551,"width":445,"height":11}},{"id":"c4d8a0fe-b10f-4acb-b198-6aeb0c602b48","block_type":"box","text":"Contingent Deferred Sales Charge — Investor C Shares","page_number":137,"box":{"x":102,"y":574,"width":396,"height":11}},{"id":"c4396288-3087-4699-aee6-ee7feaa9d1b8","block_type":"box","text":"Investor C Shares that are redeemed within one year of purchase may be subject to a 1.00% CDSC charged as a","page_number":137,"box":{"x":102,"y":596,"width":804,"height":12}},{"id":"db5a03fb-8fe4-4567-8bc5-44961c16036f","block_type":"box","text":"percentage of the dollar amount subject thereto. In determining whether an Investor C Shares CDSC is applicable to","page_number":137,"box":{"x":70,"y":612,"width":826,"height":11}},{"id":"6c660bad-e3f6-4c82-b3b3-48d15442397f","block_type":"box","text":"a redemption, the calculation will be determined in the manner that results in the lowest possible rate being charged.","page_number":137,"box":{"x":69,"y":627,"width":837,"height":11}},{"id":"38957cf3-619b-45a5-99a7-9952751f4e5e","block_type":"box","text":"The charge will be assessed on an amount equal to the lesser of the proceeds of redemption or the cost of the","page_number":137,"box":{"x":68,"y":642,"width":795,"height":11}},{"id":"31f6e816-9677-4e15-8171-277c7e491487","block_type":"box","text":"shares being redeemed. Accordingly, no CDSC will be imposed on increases in NAV above the initial purchase price of","page_number":137,"box":{"x":69,"y":657,"width":840,"height":11}},{"id":"857e230a-37fc-4428-b4f2-3af0fb6a9415","block_type":"box","text":"Investor C Shares. In addition, no CDSC will be assessed on Investor C Shares acquired through reinvestment of","page_number":137,"box":{"x":70,"y":672,"width":804,"height":11}},{"id":"ecdf04fb-74c8-4af5-8b57-d27be789c811","block_type":"box","text":"dividends. It will be assumed that the redemption is first of shares held for over one year or shares acquired","page_number":137,"box":{"x":69,"y":687,"width":772,"height":11}},{"id":"c4b6b309-f729-4914-96e3-d5eefa27ca29","block_type":"box","text":"pursuant to reinvestment of dividends and then of shares held longest during the one-year period. A transfer of","page_number":137,"box":{"x":70,"y":702,"width":790,"height":12}},{"id":"f580cc37-07e4-4406-9e2d-29a1c23795a6","block_type":"box","text":"shares from a shareholder’s account to another account will be assumed to be made in the same order as a","page_number":137,"box":{"x":69,"y":717,"width":776,"height":9}},{"id":"d159123a-045f-474e-a08c-fb0add5185ac","block_type":"box","text":"redemption.","page_number":137,"box":{"x":69,"y":733,"width":83,"height":10}},{"id":"28a93471-93b5-48ef-acbf-4d022fa46f39","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Par t I of each Fund’s SAI for","page_number":137,"box":{"x":102,"y":755,"width":734,"height":11}},{"id":"87fac4de-a6d3-4d0d-b850-85e193c1fecf","block_type":"box","text":"information about amounts paid to the Distributor in connection with CDSC shares for the periods indicated.","page_number":137,"box":{"x":70,"y":770,"width":769,"height":11}},{"id":"6855387e-ec1f-4578-af08-6ce665fdb363","block_type":"box","text":"Investor C Shares — Contingent Deferred Sales Charge Waivers and Reductions","page_number":137,"box":{"x":102,"y":793,"width":572,"height":11}},{"id":"c157e1d0-67d1-4ee8-8c65-f1152992c58d","block_type":"box","text":"The CDSC on Investor C Shares is not charged in connection with: (1) redemptions of Investor C Shares","page_number":137,"box":{"x":101,"y":816,"width":740,"height":11}},{"id":"18f9c2d4-f2da-42a6-8139-fd70dba122fd","block_type":"box","text":"purchased through cer tain employer-sponsored retirement plans and fee-based programs previously approved by","page_number":137,"box":{"x":70,"y":831,"width":802,"height":11}},{"id":"120c141a-41d0-4dcc-9cc4-576311db8b10","block_type":"box","text":"cer tain Funds and rollovers of current investments in the Fund through such plans; (2) exchanges described in","page_number":137,"box":{"x":69,"y":846,"width":786,"height":11}},{"id":"36db4f35-1f3a-4d44-b6cf-3a8ba2794cd4","block_type":"box","text":"“Exchange Privilege” below; (3) redemptions made in connection with minimum required distributions due to the","page_number":137,"box":{"x":70,"y":861,"width":797,"height":11}},{"id":"58203104-b2ed-415a-aaef-54ff0e7ad436","block_type":"box","text":"shareholder reaching age 72 from IRA and 403(b)(7) accounts; (4) redemptions made with respect to cer tain","page_number":137,"box":{"x":69,"y":876,"width":776,"height":11}},{"id":"4ce989bc-33a2-45dc-a90b-fb647b2a3008","block_type":"box","text":"retirement plans sponsored by the Fund, BlackRock or its affiliates; (5) redemptions in connection with a","page_number":137,"box":{"x":69,"y":891,"width":747,"height":11}},{"id":"1fe6cd91-8935-4b02-889e-55ebaa1d94aa","block_type":"box","text":"shareholder’s death as long as the waiver request is made within one year of death or, if later, reasonably promptly","page_number":137,"box":{"x":69,"y":906,"width":822,"height":12}},{"id":"65a077e0-6f97-4a82-87f5-dd70ef73d517","block_type":"box","text":"II-106","page_number":137,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"d47e1cd9-fd30-477e-9375-deacec750fb1","block_type":"box","text":"NM1026U-5982568-137/232","page_number":137,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"88827b45-060a-426f-b857-5acefec9ad30","block_type":"box","text":"following completion of probate (including in connection with the distribution of account assets to a beneficiary of the","page_number":138,"box":{"x":68,"y":45,"width":836,"height":11}},{"id":"fc81e414-1992-4790-94ac-4f7becd2c46b","block_type":"box","text":"decedent) or disability (as defined in the Code) subsequent to the purchase of Investor C Shares; (6) withdrawals","page_number":138,"box":{"x":69,"y":60,"width":806,"height":11}},{"id":"27c248a9-015a-4b46-a206-fb31fa67b904","block_type":"box","text":"resulting from shareholder disability (as defined in the Code) as long as the disability arose subsequent to the","page_number":138,"box":{"x":69,"y":75,"width":786,"height":11}},{"id":"e25af641-3954-4d68-a46b-b1504cb13927","block_type":"box","text":"purchase of the shares; (7) involuntary redemptions of Investor C Shares in accounts with low balances as described","page_number":138,"box":{"x":70,"y":90,"width":834,"height":11}},{"id":"59a58c72-02b3-4ee3-87a5-908976b3235f","block_type":"box","text":"in “Redemption of Shares” below; (8) redemptions made pursuant to a systematic withdrawal plan, subject to the","page_number":138,"box":{"x":70,"y":105,"width":809,"height":11}},{"id":"ca393ae2-adc6-4acd-bcc7-9931239597f5","block_type":"box","text":"limitations set for th under “Systematic Withdrawal Plan” below; (9) redemptions related to the payment of BNY","page_number":138,"box":{"x":70,"y":120,"width":791,"height":11}},{"id":"972ff40c-5dbe-45c7-b50c-739699899d46","block_type":"box","text":"Mellon Investment Servicing Trust Company custodial IRA fees; and (10) redemptions when a shareholder can","page_number":138,"box":{"x":70,"y":135,"width":784,"height":12}},{"id":"b3bfc089-5676-4e4a-8b3c-e75b9c6de33c","block_type":"box","text":"demonstrate hardship, in the absolute discretion of the Fund. In addition, no CDSC is charged on Investor C Shares","page_number":138,"box":{"x":69,"y":150,"width":824,"height":12}},{"id":"73eaf24a-5586-4543-a42c-7b3ba1283959","block_type":"box","text":"acquired through the reinvestment of dividends or distributions.","page_number":138,"box":{"x":69,"y":166,"width":451,"height":11}},{"id":"f57b8149-ddcd-4273-9219-b56f93a00877","block_type":"box","text":"Cer tain CDSC waivers and reductions on Investor C Shares may be available to customers of cer tain financial","page_number":138,"box":{"x":102,"y":188,"width":781,"height":11}},{"id":"c8731c55-5d89-4e26-920e-49285e5276ef","block_type":"box","text":"intermediaries, as described under “Intermediary-Defined Sales Charge Waiver Policies” in the Fund’s Prospectus.","page_number":138,"box":{"x":70,"y":203,"width":813,"height":12}},{"id":"7b03c7b4-b755-42e3-87c1-8829124b961f","block_type":"box","text":"Please speak to your financial intermediary for more information.","page_number":138,"box":{"x":69,"y":218,"width":462,"height":12}},{"id":"d5a87075-23a3-4cd5-b0b3-dd8bf87def32","block_type":"box","text":"Class R Shares","page_number":138,"box":{"x":69,"y":249,"width":110,"height":9}},{"id":"1bc46fa5-7e62-4f58-87c3-536b3f8cb1b1","block_type":"box","text":"Cer tain of the Funds offer Class R Shares as described in each such Fund’s Prospectus. Class R Shares are","page_number":138,"box":{"x":102,"y":271,"width":775,"height":11}},{"id":"9329f322-1319-4d26-bfd0-ed2b03ce3340","block_type":"box","text":"available only to cer tain employer-sponsored retirement plans. Class R Shares are not subject to an initial sales","page_number":138,"box":{"x":69,"y":287,"width":799,"height":11}},{"id":"adfd2473-6356-4a34-94ff-1913c01f311f","block_type":"box","text":"charge or a CDSC but are subject to an ongoing distribution fee of 0.25% per year and an ongoing service fee of","page_number":138,"box":{"x":69,"y":302,"width":801,"height":11}},{"id":"b01cc6ea-0548-4bf1-8bfb-30ffdc838f49","block_type":"box","text":"0.25% per year. Distribution fees are used to suppor t the Fund’s marketing and distribution effor ts, such as","page_number":138,"box":{"x":69,"y":317,"width":772,"height":11}},{"id":"fa7243fd-04ac-4f8d-ba42-53efa6750ddf","block_type":"box","text":"compensating financial advisers and other financial intermediaries, adver tising and promotion. Service fees are used","page_number":138,"box":{"x":69,"y":332,"width":836,"height":11}},{"id":"47f715d9-7bd3-4965-a646-e5895551e66f","block_type":"box","text":"to compensate securities dealers and other financial intermediaries for service activities.","page_number":138,"box":{"x":68,"y":347,"width":636,"height":11}},{"id":"74f2b60d-028f-4fa8-a819-46f90541ac21","block_type":"box","text":"If Class R Shares are held over time, these fees may exceed the maximum sales charge that an investor would","page_number":138,"box":{"x":102,"y":370,"width":791,"height":11}},{"id":"9fb39bdf-4731-46e5-8ab2-6ea9d9bb04e7","block_type":"box","text":"have paid as a shareholder of one of the other share classes.","page_number":138,"box":{"x":69,"y":385,"width":440,"height":11}},{"id":"dc55278a-3842-4a84-9310-5bd3e75bb5af","block_type":"box","text":"Class K Shares","page_number":138,"box":{"x":69,"y":415,"width":109,"height":9}},{"id":"6597c53b-fbe0-4f5f-9949-bf1ea29554ff","block_type":"box","text":"Cer tain Funds offer Class K Shares as described in each such Fund’s Prospectus. Class K Shares are available","page_number":138,"box":{"x":102,"y":438,"width":797,"height":11}},{"id":"9c88d13b-9a84-485d-8e51-ce24dc96afd5","block_type":"box","text":"only to (i) cer tain employee benefit plans, such as health savings accounts, and cer tain employer-sponsored","page_number":138,"box":{"x":69,"y":453,"width":772,"height":11}},{"id":"60478a82-5302-4c83-9807-7977edb5ec0e","block_type":"box","text":"retirement plans (not including SEP IRAs, SIMPLE IRAs and SARSEPs) (collectively, “Employer-Sponsored Retirement","page_number":138,"box":{"x":69,"y":468,"width":827,"height":11}},{"id":"9ad2a6c1-606a-4360-ade6-cb7463b9ffed","block_type":"box","text":"Plans”), (ii) collective trust funds, investment companies and other pooled investment vehicles, each of which may","page_number":138,"box":{"x":69,"y":483,"width":817,"height":11}},{"id":"1eec96b8-d40f-4e2b-915e-f08001325c97","block_type":"box","text":"purchase shares of the Fund through a financial intermediary that has entered into an agreement with the Distributor","page_number":138,"box":{"x":70,"y":498,"width":834,"height":11}},{"id":"a55f313a-f346-485c-a3e6-9a848bb83c0e","block_type":"box","text":"to purchase such shares, (iii) “Institutional Investors,” which include but are not limited to, endowments,","page_number":138,"box":{"x":68,"y":514,"width":748,"height":10}},{"id":"8bd3ddfc-3d0f-420c-b8fb-57e00a8d2cc4","block_type":"box","text":"foundations, family offices, banks and bank trusts, local, city, and state governmental institutions, corporations and","page_number":138,"box":{"x":68,"y":528,"width":828,"height":12}},{"id":"2151b9ac-86e9-4e01-8deb-325fe0291bf5","block_type":"box","text":"insurance company separate accounts, each of which may purchase shares of the Fund through a financial","page_number":138,"box":{"x":70,"y":543,"width":760,"height":12}},{"id":"d6b4e568-5320-4c77-9bbe-49afa9149181","block_type":"box","text":"intermediary that has entered into an agreement with the Distributor to purchase such shares, (iv) clients of private","page_number":138,"box":{"x":70,"y":559,"width":823,"height":11}},{"id":"ec0a8a89-8a2e-40ee-bcab-999d0c449a68","block_type":"box","text":"banks that purchase shares of the Fund through a financial intermediary that has entered into an agreement with the","page_number":138,"box":{"x":69,"y":574,"width":836,"height":11}},{"id":"aa38a3ff-5029-4360-ba28-65c7ffaf3b07","block_type":"box","text":"Distributor to sell such shares; (v) fee-based advisory platforms of a financial intermediary that (a) has specifically","page_number":138,"box":{"x":70,"y":589,"width":814,"height":11}},{"id":"3faa9460-1683-46ae-bc45-dd7ede9e1344","block_type":"box","text":"acknowledged in a written agreement with the Distributor and/or its affiliate(s) that the financial intermediary shall","page_number":138,"box":{"x":69,"y":604,"width":817,"height":11}},{"id":"766b14a8-2e8e-4c6d-9942-3d7ad5547846","block_type":"box","text":"offer such shares to fee-based advisory clients through an omnibus account held at the Fund or (b) transacts in the","page_number":138,"box":{"x":69,"y":619,"width":823,"height":11}},{"id":"5f558d55-6253-4a22-85c9-80f11b2ef942","block_type":"box","text":"Fund’s shares through another intermediary that has executed such an agreement and (vi) any other investors who","page_number":138,"box":{"x":70,"y":634,"width":818,"height":12}},{"id":"bcc7fd3c-68ca-4fe7-bd49-344965db8a12","block_type":"box","text":"met the eligibility criteria for BlackRock Shares or Class K Shares prior to August 15, 2016 and have continually held","page_number":138,"box":{"x":69,"y":649,"width":833,"height":12}},{"id":"40e53414-b6cb-4492-87c7-b1ff51c43920","block_type":"box","text":"Class K Shares of the Fund or the respective Predecessor Fund in the same account since August 15, 2016. The","page_number":138,"box":{"x":69,"y":664,"width":807,"height":12}},{"id":"65657db6-1c97-4e3d-a408-2dc2fd248876","block_type":"box","text":"agreement referenced in (iv) above shall appear in a supplemental agreement to any selling, sub-transfer agent, or","page_number":138,"box":{"x":69,"y":680,"width":817,"height":11}},{"id":"490f50a4-e21b-4883-b854-169b4cdc2380","block_type":"box","text":"distribution and marketing agreement.","page_number":138,"box":{"x":69,"y":695,"width":270,"height":11}},{"id":"d0eb55a5-d7df-4381-951e-68676f753e33","block_type":"box","text":"Class K Shares are also available to employees, officers and directors/trustees of BlackRock, Inc. and","page_number":138,"box":{"x":102,"y":717,"width":734,"height":12}},{"id":"ee223e3a-4f2b-4313-af83-090595f8d7eb","block_type":"box","text":"BlackRock Funds and immediate family members of such persons, if they open an account directly with BlackRock.","page_number":138,"box":{"x":70,"y":732,"width":817,"height":12}},{"id":"5ab329da-7186-4522-88d4-565056d80b21","block_type":"box","text":"Eligible individuals who would like to conver t existing holdings to Class K Shares must contact BlackRock.","page_number":138,"box":{"x":70,"y":748,"width":753,"height":11}},{"id":"917b3de1-017a-4e2f-81d7-f622e1f4e7ee","block_type":"box","text":"Class G Shares","page_number":138,"box":{"x":69,"y":778,"width":110,"height":9}},{"id":"7a0ab9ba-ddcc-4d12-80b7-8bc8a1ea980f","block_type":"box","text":"Cer tain Funds offer Class G Shares, which are available only to investors on eligible platforms. Eligible platforms","page_number":138,"box":{"x":102,"y":801,"width":804,"height":11}},{"id":"6aeca84b-140f-4b57-a9d9-c2a9cd2b0162","block_type":"box","text":"are those where clients invest in the Fund through a single omnibus account in the name of a financial intermediary","page_number":138,"box":{"x":69,"y":816,"width":826,"height":11}},{"id":"7957cd8f-de61-40e7-b4fb-083cb5eb35f1","block_type":"box","text":"that meets an initial investment minimum of $2 billion. For clients investing through such eligible platforms, the Fund","page_number":138,"box":{"x":68,"y":830,"width":836,"height":12}},{"id":"603c2dbf-ab07-44c4-a86c-ac6e1acde464","block_type":"box","text":"does not impose investment minimums on any individual investor. Financial intermediaries may impose separate","page_number":138,"box":{"x":69,"y":846,"width":803,"height":11}},{"id":"61046fa6-57e3-48d7-9d09-f1b5bf3d10d3","block_type":"box","text":"eligibility requirements.","page_number":138,"box":{"x":69,"y":861,"width":164,"height":11}},{"id":"13c81b9d-a9da-492b-9d6b-88c5963b23c2","block_type":"box","text":"II-107","page_number":138,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"585949bf-a2cb-427b-9c14-08f95d356065","block_type":"box","text":"NM1026U-5982568-138/232","page_number":138,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"e729e82d-6fd7-4364-b8e0-c740469e4472","block_type":"box","text":"Service Shares","page_number":139,"box":{"x":68,"y":45,"width":109,"height":9}},{"id":"4475bd8a-bfd2-4726-ab9a-ecc440c82173","block_type":"box","text":"Cer tain Funds offer Service Shares, which are available only to cer tain investors, including: (i) cer tain financial","page_number":139,"box":{"x":102,"y":67,"width":788,"height":12}},{"id":"7f8f6030-5b60-4a73-8709-e8efa471140d","block_type":"box","text":"institutions, such as banks and brokerage firms, acting on behalf of their customers; (ii) cer tain persons who were","page_number":139,"box":{"x":70,"y":82,"width":815,"height":12}},{"id":"25efbf5d-51c5-41bb-9d72-a7f5eb7119a6","block_type":"box","text":"shareholders of the Compass Capital Group of Funds at the time of its combination with The PNC","page_number":139,"box":{"x":69,"y":98,"width":693,"height":11}},{"id":"5c8ad913-1679-4b12-8615-4bafa73ae628","block_type":"box","text":"®","page_number":139,"box":{"x":763,"y":98,"width":6,"height":4}},{"id":"19b03be8-3dde-45fa-baab-88b03e8af820","block_type":"box","text":"Fund in 1996; and","page_number":139,"box":{"x":775,"y":98,"width":130,"height":10}},{"id":"0ae273f9-8456-4b66-ad72-f7ce367852e6","block_type":"box","text":"(iii) par ticipants in the Capital Directions","page_number":139,"box":{"x":69,"y":113,"width":287,"height":11}},{"id":"118cafaf-9f7e-4333-b1e3-2cff78bd9e9c","block_type":"box","text":"SM","page_number":139,"box":{"x":357,"y":113,"width":11,"height":5}},{"id":"67ce2cf4-642d-4c90-b831-8b3eed4535a3","block_type":"box","text":"asset allocation program. Service Shares are not subject to an initial sales","page_number":139,"box":{"x":374,"y":113,"width":534,"height":11}},{"id":"14a00eae-f715-4212-bd02-fcef723a13d7","block_type":"box","text":"charge or a CDSC but are subject to an ongoing service fee as set for th in the applicable Fund’s Prospectus.","page_number":139,"box":{"x":69,"y":128,"width":776,"height":11}},{"id":"89d2923b-e27a-41c9-a6c7-cba7a06f0178","block_type":"box","text":"BlackRock Shares","page_number":139,"box":{"x":69,"y":158,"width":133,"height":9}},{"id":"c303a403-499a-4e71-84d6-7ba36d3b26ef","block_type":"box","text":"Cer tain Funds offer BlackRock Shares, which are available only to cer tain investors. BlackRock Shares are","page_number":139,"box":{"x":102,"y":181,"width":760,"height":11}},{"id":"f2d73e91-ff80-40ef-a1cd-da1e2cfc4846","block_type":"box","text":"offered without a sales charge to institutional and individual investors, registered investment advisers and cer tain","page_number":139,"box":{"x":69,"y":196,"width":813,"height":11}},{"id":"1c2004f6-ce04-490e-a6a5-213743df9a7c","block_type":"box","text":"fee-based programs.","page_number":139,"box":{"x":68,"y":211,"width":145,"height":11}},{"id":"7c5e0fae-04aa-4875-af86-10fe1f84c5bf","block_type":"box","text":"Distribution and/or Shareholder Servicing Plans","page_number":139,"box":{"x":69,"y":241,"width":348,"height":11}},{"id":"e9de1b35-f719-4a03-8cc5-9bfcf0e29b12","block_type":"box","text":"Each Fund has adopted a plan (each, a “Plan”) pursuant to Rule 12b-1 under the Investment Company Act with","page_number":139,"box":{"x":102,"y":264,"width":790,"height":11}},{"id":"124df459-9e5f-4abd-9b8b-518e15a1d78a","block_type":"box","text":"respect to cer tain share classes that allows the Fund to pay distribution fees for the sale of its shares and","page_number":139,"box":{"x":69,"y":279,"width":761,"height":11}},{"id":"457e11d3-a86a-4f44-9fb4-c793edc55e5a","block_type":"box","text":"shareholder servicing fees for cer tain services provided to its shareholders.","page_number":139,"box":{"x":69,"y":294,"width":541,"height":11}},{"id":"3520c977-0ba9-4c29-988b-694a891e3b80","block_type":"box","text":"Pursuant to the Plans, a Fund may pay BRIL and/or BlackRock, or any other affiliate or significant shareholder of","page_number":139,"box":{"x":102,"y":317,"width":803,"height":11}},{"id":"b87f336e-2589-4c96-9d31-bf794011cb66","block_type":"box","text":"BlackRock, fees for distribution and sales suppor t services with respect to Investor A, Investor A1, Investor C,","page_number":139,"box":{"x":70,"y":332,"width":783,"height":11}},{"id":"8104855a-ab1c-4f30-92ae-d2347bb97ffb","block_type":"box","text":"Investor P, Service and Class R Shares. Currently, as described fur ther below, only Investor C and Class R Shares","page_number":139,"box":{"x":70,"y":347,"width":809,"height":11}},{"id":"20c0dc55-e8cb-4635-bf34-b0abc7e0b46b","block_type":"box","text":"bear the expense of distribution fees under a Plan.","page_number":139,"box":{"x":69,"y":362,"width":360,"height":11}},{"id":"0eebfbf5-5235-45b2-bb45-f2af325e7b5e","block_type":"box","text":"Each Fund has entered into a distribution agreement with BRIL under which BRIL, as agent, offers shares of","page_number":139,"box":{"x":102,"y":385,"width":770,"height":11}},{"id":"37182898-2421-41f6-a7f4-a744aca1aee3","block_type":"box","text":"each Fund on a continuous basis. BRIL has agreed to use appropriate effor ts to effect sales of the shares, but it is","page_number":139,"box":{"x":69,"y":400,"width":824,"height":11}},{"id":"c9760ba0-7964-45c4-bb8a-f2c2995aaf83","block_type":"box","text":"not obligated to sell any par ticular amount of shares. BRIL’s principal business address is 50 Hudson Yards, New","page_number":139,"box":{"x":69,"y":415,"width":812,"height":11}},{"id":"aa15b4ca-8460-4d5c-8559-49916d7583ec","block_type":"box","text":"York, NY 10001. BRIL is an affiliate of BlackRock.","page_number":139,"box":{"x":68,"y":430,"width":355,"height":11}},{"id":"cdcf0337-73fd-47fc-bc32-365f9ae6a439","block_type":"box","text":"Pursuant to the Plans, each Fund may also pay shareholder servicing fees (also referred to as general","page_number":139,"box":{"x":102,"y":453,"width":727,"height":11}},{"id":"c5063a8f-fbc5-483e-9c38-ff98ba778380","block_type":"box","text":"shareholder liaison services fees) to affiliated and unaffiliated brokers, dealers, financial institutions, insurance","page_number":139,"box":{"x":69,"y":468,"width":799,"height":11}},{"id":"1b328c27-96b6-424a-aa92-34be85fbd6c0","block_type":"box","text":"companies, retirement plan record-keepers and other financial intermediaries (including BlackRock, BRIL and their","page_number":139,"box":{"x":69,"y":483,"width":813,"height":11}},{"id":"bbce007f-7e4f-40b5-9a8a-6ac142afca48","block_type":"box","text":"affiliates) (collectively, “Service Organizations”) for cer tain suppor t services rendered by Service Organizations to","page_number":139,"box":{"x":69,"y":498,"width":809,"height":11}},{"id":"cbaafc21-af92-4303-a473-d333f6b059a2","block_type":"box","text":"their customers (“Customers”) who are the beneficial owners of Investor A, Investor A1, Investor C, Investor P,","page_number":139,"box":{"x":68,"y":513,"width":786,"height":11}},{"id":"06f8f93f-76af-4b2c-9192-c61fbff715ac","block_type":"box","text":"Service and Class R Shares of a Fund. Such services are intended to supplement the services provided by the","page_number":139,"box":{"x":69,"y":528,"width":789,"height":12}},{"id":"90861182-eeab-4b4a-848c-ef7f77f7e642","block_type":"box","text":"Fund’s Administrators and Transfer Agent to the Fund’s shareholders of record.","page_number":139,"box":{"x":70,"y":543,"width":562,"height":12}},{"id":"66b47620-15ab-4fd2-b0df-eca575f1492e","block_type":"box","text":"The suppor t services provided by Service Organizations are general shareholder liaison services, which include,","page_number":139,"box":{"x":101,"y":566,"width":798,"height":11}},{"id":"49b4b6a7-d8ce-4c84-9fb9-995ce3757080","block_type":"box","text":"but are not limited to: (i) answering Customer inquiries regarding account status and history, the manner in which","page_number":139,"box":{"x":69,"y":581,"width":808,"height":12}},{"id":"cbaf6d78-079a-4e78-8e60-db3a4b3eacc3","block_type":"box","text":"purchases, exchanges and redemptions or repurchases of shares may be effected and cer tain other matters","page_number":139,"box":{"x":70,"y":596,"width":776,"height":12}},{"id":"8c2fb116-759a-47d2-ae66-63ca6145f721","block_type":"box","text":"per taining to the Customers’ investments; and (ii) assisting Customers in designating and changing dividend options,","page_number":139,"box":{"x":70,"y":612,"width":835,"height":11}},{"id":"e36d36cf-35e3-4976-931b-953a6ce3d424","block_type":"box","text":"account designations and addresses. The shareholder servicing fees payable pursuant to the Plans are paid to","page_number":139,"box":{"x":69,"y":627,"width":791,"height":11}},{"id":"f0d67716-8cdc-4b2b-a6bf-2ec67f64a0db","block_type":"box","text":"compensate Service Organizations for the administration and servicing of shareholder accounts and are not costs","page_number":139,"box":{"x":69,"y":642,"width":813,"height":11}},{"id":"29eaf0c6-dc97-465e-8ca8-20b579f50792","block_type":"box","text":"which are primarily intended to result in the sale of the Fund’s shares.","page_number":139,"box":{"x":68,"y":657,"width":501,"height":11}},{"id":"add487e1-16f4-4d7e-8835-f3825331e981","block_type":"box","text":"Payments under the Plans are based on a percentage of average daily net assets attributable to the shares in","page_number":139,"box":{"x":102,"y":680,"width":783,"height":11}},{"id":"b850c12c-7d4b-4834-8996-1cb775f547e8","block_type":"box","text":"the applicable share class regardless of the amount of expenses incurred. As a result, payments under the Plans","page_number":139,"box":{"x":68,"y":695,"width":810,"height":11}},{"id":"fa366541-f95d-43ff-8639-c1fbf1bc9876","block_type":"box","text":"may be more or less than expenses incurred in connection with providing distribution and/or shareholder services","page_number":139,"box":{"x":69,"y":710,"width":813,"height":11}},{"id":"894bfa9a-0616-4ba7-8780-2f7b3e03d765","block_type":"box","text":"with respect to the related class. Information with respect to the payments under the Plans and expenses incurred in","page_number":139,"box":{"x":68,"y":725,"width":836,"height":11}},{"id":"e918de5e-f432-4a66-8a27-ee5f91ce8e6d","block_type":"box","text":"providing services with respect to the related class is presented to the Directors for their consideration quar terly.","page_number":139,"box":{"x":70,"y":740,"width":805,"height":11}},{"id":"983120ee-f659-486a-a21d-b30d88073101","block_type":"box","text":"Payments under the Plans consist of the shareholder servicing fees and the distribution fees. Expenses with respect","page_number":139,"box":{"x":69,"y":755,"width":832,"height":11}},{"id":"c0277e92-69d8-442c-acac-c3c765b2d4bb","block_type":"box","text":"to providing distribution and/or shareholder services with respect to a class may consist of Service Organization","page_number":139,"box":{"x":68,"y":770,"width":803,"height":12}},{"id":"d2d4f59f-48b8-4629-a970-19927c461a15","block_type":"box","text":"financial adviser compensation, branch office and regional operation center selling and transaction processing","page_number":139,"box":{"x":68,"y":785,"width":788,"height":12}},{"id":"8729dd2f-64d9-4560-9b6a-6e19fa0ffa64","block_type":"box","text":"expenses, adver tising, sales promotion and marketing expenses. Payments under the Plans with respect to one","page_number":139,"box":{"x":69,"y":801,"width":798,"height":11}},{"id":"0e594f9e-88f6-44d7-80a5-2da574324d18","block_type":"box","text":"class will not be used to finance the expenditures of another class. Sales personnel may receive different","page_number":139,"box":{"x":69,"y":816,"width":755,"height":11}},{"id":"d324d095-bddb-4e65-bed2-da3314bece0f","block_type":"box","text":"compensation for selling different classes of shares.","page_number":139,"box":{"x":69,"y":831,"width":375,"height":11}},{"id":"d2e7684d-2566-4e9a-ba1f-c38db8eac4b1","block_type":"box","text":"Each Plan is subject to the provisions of Rule 12b-1 under the Investment Company Act. In their consideration of","page_number":139,"box":{"x":102,"y":853,"width":803,"height":12}},{"id":"05a88863-e5fd-49c0-b402-e07feb5b47bf","block_type":"box","text":"a Plan, the Directors must consider all factors they deem relevant, including information as to the benefits of the Plan","page_number":139,"box":{"x":69,"y":869,"width":839,"height":11}},{"id":"ef607339-1e82-44b1-9394-87a035cf59b1","block_type":"box","text":"to the Fund and the related class of shareholders. In approving a Plan in accordance with Rule 12b-1, the non","page_number":139,"box":{"x":68,"y":884,"width":788,"height":11}},{"id":"90d59bf6-b881-4047-90d6-e4dc8294677a","block_type":"box","text":"interested Directors concluded that there is reasonable likelihood that the Plan will benefit the Fund and its related","page_number":139,"box":{"x":70,"y":899,"width":818,"height":9}},{"id":"259ad45f-f0b1-4810-bf11-381c38324097","block_type":"box","text":"II-108","page_number":139,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"14a4f2d9-1abc-4929-939e-9b9d5f5da406","block_type":"box","text":"NM1026U-5982568-139/232","page_number":139,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"4e761ccd-c0cd-4970-87e1-4f3415d8d925","block_type":"box","text":"class of shareholders. The Plan provides, among other things, that: (i) the Board of Directors shall receive quar terly","page_number":140,"box":{"x":69,"y":45,"width":824,"height":11}},{"id":"0cd8ab8a-0172-4303-b52b-ead350534202","block_type":"box","text":"repor ts regarding the amounts expended under the Plan and the purposes for which such expenditures were made;","page_number":140,"box":{"x":69,"y":60,"width":821,"height":11}},{"id":"eed28b51-29fe-44a5-9c2b-034e79e030fe","block_type":"box","text":"(ii) the Plan will continue in effect for so long as its continuance is approved at least annually by the Board of","page_number":140,"box":{"x":69,"y":75,"width":778,"height":11}},{"id":"5d665171-c9ca-4727-8235-391c2de292eb","block_type":"box","text":"Directors, including the directors who are not “interested persons” of the Fund (as defined in the Investment","page_number":140,"box":{"x":70,"y":90,"width":773,"height":11}},{"id":"becca3a3-6b57-428e-a22b-14c1d1612678","block_type":"box","text":"Company Act) and who have no direct or indirect financial interest in the operation of the Plan or any agreement","page_number":140,"box":{"x":69,"y":105,"width":796,"height":11}},{"id":"a70f8274-9abf-458a-b726-381cb003e1b4","block_type":"box","text":"entered into in connection with the Plan (the “12b-1 Directors”), acting in person at a meeting called for said purpose","page_number":140,"box":{"x":69,"y":120,"width":837,"height":12}},{"id":"ce634ebf-4d77-4022-9b8f-787ca59b5fff","block_type":"box","text":"in accordance with Rule 12b-1 under the Investment Company Act; (iii) any material amendment thereto must be","page_number":140,"box":{"x":70,"y":135,"width":801,"height":11}},{"id":"669fb37a-dbcd-439e-b437-6a5100cc62b7","block_type":"box","text":"approved by the Board of Directors, including the 12b-1 Directors, acting in person at a meeting called for said","page_number":140,"box":{"x":69,"y":150,"width":787,"height":12}},{"id":"94d79094-c6be-4253-a793-45784009aec1","block_type":"box","text":"purpose; (iv) any amendment to increase materially the costs which any class of shares may bear for distribution","page_number":140,"box":{"x":70,"y":166,"width":802,"height":11}},{"id":"a8b0ca2f-0b4c-45ba-ba74-6bc6af36e26c","block_type":"box","text":"services pursuant to the Plan shall be effective only upon approval by a vote of a majority of the outstanding shares","page_number":140,"box":{"x":69,"y":181,"width":826,"height":11}},{"id":"e4e2b980-0556-4ca7-a0a7-75bd8821e4b0","block_type":"box","text":"of such class and by a majority of the Board of Directors, including the 12b-1 Directors, acting in person at a meeting","page_number":140,"box":{"x":69,"y":196,"width":836,"height":11}},{"id":"2474f4b2-b0ae-494a-922c-2acae0e376d9","block_type":"box","text":"called for said purpose; and (v) while the Plan remains in effect, the selection and nomination of the Fund’s Directors","page_number":140,"box":{"x":69,"y":211,"width":836,"height":11}},{"id":"f82e88af-726f-4d0f-b6d5-821c806ad1e2","block_type":"box","text":"who are not “interested persons” of the Fund shall be committed to the discretion of the Fund’s non-interested","page_number":140,"box":{"x":68,"y":226,"width":792,"height":11}},{"id":"30b802d6-4fbf-4f38-929f-f74c69bd6351","block_type":"box","text":"Directors. Rule 12b-1 fur ther requires that each Fund preserve copies of each Plan and any repor t made pursuant to","page_number":140,"box":{"x":70,"y":241,"width":831,"height":11}},{"id":"96be43f5-7cb4-47d8-bf00-bf5c9756a295","block_type":"box","text":"such Plan for a period of not less than six years from the date of the Plan or such repor t, the first two years in an","page_number":140,"box":{"x":69,"y":256,"width":807,"height":11}},{"id":"cc1e335d-d159-48ca-8e7a-3d60234f049f","block_type":"box","text":"easily accessible place.","page_number":140,"box":{"x":69,"y":272,"width":167,"height":11}},{"id":"a18ce31a-9af9-4489-ae0c-ba70492a3abf","block_type":"box","text":"Each Plan is terminable as to any class of shares without penalty at any time by a vote of a majority of the 12b-1","page_number":140,"box":{"x":102,"y":294,"width":804,"height":11}},{"id":"daac8d10-8a3f-472c-b1ef-983d8671a635","block_type":"box","text":"Directors, or by vote of the holders of a majority of the shares of such class.","page_number":140,"box":{"x":70,"y":309,"width":542,"height":11}},{"id":"115d1e74-65da-4c4b-b57f-4b653f8570c2","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Par t I of each Fund’s SAI for","page_number":140,"box":{"x":102,"y":332,"width":734,"height":11}},{"id":"b9b9cf10-0f4e-4af0-b935-be540f3b89ff","block_type":"box","text":"information relating to the fees paid by your Fund to the Distributor under each Plan during the Fund’s most recent","page_number":140,"box":{"x":70,"y":347,"width":814,"height":11}},{"id":"2f028013-4cb2-4e2d-a2ee-1c315ce98663","block_type":"box","text":"fiscal year.","page_number":140,"box":{"x":68,"y":362,"width":75,"height":11}},{"id":"17713048-df35-4fa5-accc-a819568faa43","block_type":"box","text":"Limitations on the Payment of Deferred Sales Charges","page_number":140,"box":{"x":69,"y":392,"width":396,"height":11}},{"id":"b03da1c3-ca8d-401d-8f37-82e58a54b1eb","block_type":"box","text":"The maximum sales charge rule in the Conduct Rules of the Financial Industry Regulatory Authority (“FINRA”)","page_number":140,"box":{"x":101,"y":415,"width":777,"height":11}},{"id":"90ddc555-f193-497d-a1b1-304a13613343","block_type":"box","text":"imposes a limitation on cer tain asset-based sales charges such as the distribution fee borne by Class R Shares, and","page_number":140,"box":{"x":70,"y":430,"width":835,"height":11}},{"id":"2729eb85-09af-42ca-8d58-cf2fcb27f7a6","block_type":"box","text":"the distribution fee and the CDSC borne by the Investor C Shares. This limitation does not apply to the shareholder","page_number":140,"box":{"x":68,"y":445,"width":822,"height":11}},{"id":"4ed22cf1-6e9f-4498-8965-5639c49c6384","block_type":"box","text":"servicing fee. The maximum sales charge rule is applied separately to each class and limits the aggregate of","page_number":140,"box":{"x":69,"y":460,"width":778,"height":12}},{"id":"541db6dd-24ef-4526-9a1b-72089a37749b","block_type":"box","text":"distribution fee payments and CDSCs payable by a Fund to (1) 6.25% of eligible gross sales of Investor C and Class R","page_number":140,"box":{"x":69,"y":475,"width":840,"height":12}},{"id":"1bafef6c-5afd-45be-8027-dcd9ccbb917f","block_type":"box","text":"Shares, computed separately (excluding shares issued pursuant to dividend reinvestments and exchanges), plus","page_number":140,"box":{"x":69,"y":491,"width":803,"height":11}},{"id":"ac2f027f-df3e-45eb-9159-4c3ea1eb8050","block_type":"box","text":"(2) interest on the unpaid balance for the respective class, computed separately, at the prime rate plus 1% (the","page_number":140,"box":{"x":69,"y":506,"width":794,"height":11}},{"id":"454de4cc-82cb-4678-9052-bdd8ce60ed21","block_type":"box","text":"unpaid balance being the maximum amount payable minus amounts received from the payment of the distribution fee","page_number":140,"box":{"x":69,"y":521,"width":839,"height":11}},{"id":"9180ff9b-3ddd-4f74-99e0-de700a4f7d48","block_type":"box","text":"and the CDSC). See “Information on Sales Charges and Distribution Related Expenses” in Par t I of each Fund’s SAI","page_number":140,"box":{"x":69,"y":536,"width":824,"height":11}},{"id":"d0cd67d9-d04b-41b7-88de-707679ee23b3","block_type":"box","text":"for comparative information as of your Fund’s most recent fiscal year end with respect to, if applicable, the Investor C","page_number":140,"box":{"x":68,"y":551,"width":839,"height":11}},{"id":"1c91f00f-f043-4ea7-9fae-313c01ff95cb","block_type":"box","text":"and Class R Shares of your Fund.","page_number":140,"box":{"x":69,"y":566,"width":236,"height":11}},{"id":"fd6332b7-2254-4ba8-8875-74fc5f1405c4","block_type":"box","text":"Other Payments by the Fund","page_number":140,"box":{"x":69,"y":597,"width":206,"height":11}},{"id":"0cd0528b-0a90-4a28-b4a8-eb2d07335fb8","block_type":"box","text":"In addition to shareholder servicing fees that a Fund may pay to a Service Organization pursuant to the Plan and","page_number":140,"box":{"x":102,"y":619,"width":800,"height":11}},{"id":"59547c49-0c9d-44fd-9b16-9af84578a65a","block_type":"box","text":"fees the Fund pays to its Transfer Agent, BlackRock, on behalf of a Fund, may enter into non-Plan agreements with","page_number":140,"box":{"x":68,"y":634,"width":816,"height":12}},{"id":"05038d11-1e18-41b5-a490-18a6bc38b480","block_type":"box","text":"Service Organizations pursuant to which the Fund will pay a Service Organization for administrative, networking,","page_number":140,"box":{"x":69,"y":649,"width":794,"height":12}},{"id":"474da91d-2107-41bf-ba23-4beb9b42c70e","block_type":"box","text":"recordkeeping, sub-transfer agency, sub-accounting and/or shareholder services. These non-Plan payments are","page_number":140,"box":{"x":69,"y":664,"width":792,"height":12}},{"id":"69f24c2b-35ca-4a24-b30f-d7a7a693969d","block_type":"box","text":"generally based on either (1) a percentage of the average daily net assets of Fund shareholders serviced by a Service","page_number":140,"box":{"x":68,"y":680,"width":841,"height":11}},{"id":"a2c8ff8e-2326-4ad8-948e-358c30049139","block_type":"box","text":"Organization or (2) a fixed dollar amount for each account serviced by a Service Organization. The aggregate amount","page_number":140,"box":{"x":69,"y":695,"width":831,"height":11}},{"id":"130ccdaa-a4a0-4072-9c2c-2532caff1bbb","block_type":"box","text":"of these payments may be substantial.","page_number":140,"box":{"x":69,"y":710,"width":276,"height":11}},{"id":"28548948-898b-4e19-9471-4877b393ac58","block_type":"box","text":"Additional Payments by BlackRock","page_number":140,"box":{"x":68,"y":740,"width":256,"height":11}},{"id":"18b4846c-1d46-4627-8248-d6e736c32a32","block_type":"box","text":"From time to time, BlackRock, BRIL and/or their affiliates (referred to in this section collectively as “BlackRock”)","page_number":140,"box":{"x":102,"y":763,"width":803,"height":11}},{"id":"e76c42c0-8ef5-4ca6-8b90-c9b1ab83bf58","block_type":"box","text":"may compensate Service Organizations for the sale and distribution of shares of a Fund, for services to a Fund and","page_number":140,"box":{"x":69,"y":778,"width":823,"height":11}},{"id":"9a779e18-5416-4482-a5ff-a48ecd4085f9","block_type":"box","text":"its shareholders and/or for data provision or technology suppor t. A Service Organization may per form these","page_number":140,"box":{"x":70,"y":793,"width":768,"height":11}},{"id":"533ea440-8b56-40b9-bcaa-4576cbffd250","block_type":"box","text":"obligations itself or may arrange for a third par ty to per form them. These payments, which are not made pursuant to","page_number":140,"box":{"x":69,"y":808,"width":830,"height":11}},{"id":"e8cf3c56-2b84-40f5-abf5-38a12ec8fffe","block_type":"box","text":"a Plan or otherwise paid by a Fund, are referred to as “Additional Payments” herein.","page_number":140,"box":{"x":69,"y":823,"width":599,"height":11}},{"id":"39d05935-6fba-41db-bd0b-5cdd60266579","block_type":"box","text":"Additional Payments are made from BlackRock’s own assets (which may come directly or indirectly from fees","page_number":140,"box":{"x":101,"y":846,"width":776,"height":11}},{"id":"fe35b3ae-6328-45e8-a3e3-956b893f6381","block_type":"box","text":"paid by a Fund to BlackRock for various services, such as investment advisory services). These payments are not an","page_number":140,"box":{"x":70,"y":861,"width":832,"height":11}},{"id":"0985fd0b-ff8a-49c8-8d5a-a3eb8dbde393","block_type":"box","text":"additional charge to a Fund or its shareholders and do not change the price paid by shareholders for the purchase of","page_number":140,"box":{"x":69,"y":876,"width":833,"height":11}},{"id":"df5e8804-ea49-4177-9245-e89f9073b6c6","block_type":"box","text":"a Fund’s shares or the amount a Fund receives as proceeds from such purchases. Additional Payments made to","page_number":140,"box":{"x":69,"y":891,"width":802,"height":11}},{"id":"3ecdf1af-1d94-47bb-ab43-712552a3149d","block_type":"box","text":"Service Organizations are in addition to any distribution or shareholder servicing fees paid under any Plan of any","page_number":140,"box":{"x":69,"y":906,"width":802,"height":12}},{"id":"2212460c-236b-42fe-9d6a-9109bb9b4eb2","block_type":"box","text":"II-109","page_number":140,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"02f1fc8d-a0b2-4bc7-a7b0-06445e0f137b","block_type":"box","text":"NM1026U-5982568-140/232","page_number":140,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"44e4a2e1-66aa-42f3-86cc-c117ea9f1590","block_type":"box","text":"Fund, any sales charges, commissions or other concessions described in the Prospectuses or this SAI, and any","page_number":141,"box":{"x":70,"y":45,"width":796,"height":11}},{"id":"1d2ef94e-82be-48fe-bb39-22e8d721480f","block_type":"box","text":"administrative, networking, recordkeeping, sub-transfer agency or sub-accounting fees payable by a Fund. Pursuant to","page_number":141,"box":{"x":69,"y":60,"width":836,"height":11}},{"id":"719dfdc6-201d-42a4-a86f-d4e95d0870c0","block_type":"box","text":"applicable FINRA regulations, the details of cer tain of these payments, including the Service Organizations receiving","page_number":141,"box":{"x":69,"y":75,"width":828,"height":11}},{"id":"f86e1b70-0912-4986-818e-c0dfa5bc5885","block_type":"box","text":"such payments in connection with the sale and distribution of Fund shares, are required to be disclosed. While FINRA","page_number":141,"box":{"x":69,"y":90,"width":837,"height":11}},{"id":"77d028e1-5623-4fce-9e0c-b4578958b46a","block_type":"box","text":"regulations limit the sales charges that shareholders may bear, there are no limits with regard to the amounts that","page_number":141,"box":{"x":69,"y":105,"width":818,"height":11}},{"id":"5853dc47-0446-4bd6-9861-b90f77910cc7","block_type":"box","text":"BlackRock may pay out of its own assets.","page_number":141,"box":{"x":70,"y":120,"width":294,"height":11}},{"id":"eb32783a-5707-4fec-99f0-9f49d2f04915","block_type":"box","text":"Additional Payments may be made as a fixed dollar amount, may be based on the number of Customer accounts","page_number":141,"box":{"x":101,"y":143,"width":803,"height":11}},{"id":"58d12304-66b5-4d66-9813-ec8d1a175021","block_type":"box","text":"maintained by a Service Organization, may be based on a percentage of the value of shares sold to, or held by,","page_number":141,"box":{"x":69,"y":158,"width":792,"height":11}},{"id":"63bf9567-921b-4f26-8d0a-a02fa5ed2b95","block_type":"box","text":"Customers of the Service Organization involved, or may be calculated on another basis.","page_number":141,"box":{"x":69,"y":173,"width":623,"height":11}},{"id":"4cf28b6a-d37f-433b-88ce-c5e92b090d22","block_type":"box","text":"BlackRock negotiates Additional Payments with each Service Organization on an individual basis. Additional","page_number":141,"box":{"x":102,"y":196,"width":765,"height":11}},{"id":"0ee5840f-ef4d-4ba7-839d-58147e11fd70","block_type":"box","text":"Payments may be different for different Service Organizations, and some Service Organizations may be paid pursuant","page_number":141,"box":{"x":69,"y":211,"width":841,"height":11}},{"id":"04bf5eaa-9740-43b8-ba1e-97eaccfff98b","block_type":"box","text":"to more than one of the calculations described above. Not all Service Organizations receive Additional Payments.","page_number":141,"box":{"x":68,"y":226,"width":806,"height":11}},{"id":"a6ba5d08-db33-42bd-a02a-a00a8cb5a9a4","block_type":"box","text":"Sales-based payments primarily create incentives to make new sales of shares of the Fund, and asset-based","page_number":141,"box":{"x":69,"y":241,"width":776,"height":11}},{"id":"7427eef9-5efc-4466-8f9a-e0d4bb1f2152","block_type":"box","text":"payments primarily create incentives to retain previously sold shares of the Fund. The level of payments made to","page_number":141,"box":{"x":70,"y":256,"width":802,"height":11}},{"id":"609d6d61-4083-472b-a1fa-346143e1c21e","block_type":"box","text":"these Service Organizations in any year will vary and may be limited to specific Funds or share classes. In cer tain","page_number":141,"box":{"x":68,"y":271,"width":811,"height":12}},{"id":"6f24b348-8143-4dd1-9b1e-b6eed5c3ea7c","block_type":"box","text":"cases, these payments may be subject to cer tain minimum payment levels.","page_number":141,"box":{"x":69,"y":287,"width":538,"height":11}},{"id":"eaacf0a4-87ed-4752-81a2-0b0afb4bc397","block_type":"box","text":"The aggregate amount of Additional Payments made by BlackRock may be substantial and may be significant to","page_number":141,"box":{"x":101,"y":309,"width":795,"height":11}},{"id":"e9331494-83ff-428d-97a5-2548f5aea4a1","block_type":"box","text":"cer tain Service Organizations. The categories of Additional Payments listed below are not mutually exclusive. The","page_number":141,"box":{"x":69,"y":324,"width":807,"height":12}},{"id":"a88372f2-2295-43ef-be1f-591ef0afa928","block_type":"box","text":"same Service Organization, or one or more of its affiliates, may receive payments under more than one category of","page_number":141,"box":{"x":69,"y":339,"width":823,"height":12}},{"id":"2970dce6-807a-428b-b686-1b42c426b5fb","block_type":"box","text":"Additional Payments. Such payments may be different for different Service Organizations and for different types of","page_number":141,"box":{"x":68,"y":355,"width":819,"height":11}},{"id":"3fc9abff-4141-475e-b4f1-388e0efe8946","block_type":"box","text":"Funds.","page_number":141,"box":{"x":70,"y":370,"width":44,"height":9}},{"id":"8ac3f0c7-7a14-4e80-b6f0-789fc34fd639","block_type":"box","text":"A. Distribution and Marketing Suppor t","page_number":141,"box":{"x":101,"y":392,"width":270,"height":12}},{"id":"4b072a2b-b0e6-4743-828c-d70565824870","block_type":"box","text":"Additional Payments may be made by BlackRock for distribution and marketing suppor t activities. 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BlackRock","page_number":145,"box":{"x":70,"y":361,"width":833,"height":11}},{"id":"1135a069-02b0-436e-bfd7-90a47bffb10d","block_type":"box","text":"configures these tools and calculators and localizes the content for Service Organizations as par t of its customary","page_number":145,"box":{"x":69,"y":376,"width":817,"height":11}},{"id":"440e913b-e695-4e7d-a746-f1791b02ce56","block_type":"box","text":"digital marketing suppor t and promotion of the Funds or other BlackRock funds, iShares ETFs and other exchange","page_number":145,"box":{"x":69,"y":391,"width":815,"height":11}},{"id":"cfafd3e4-c9cf-46c2-b3d6-d63c5a933b8e","block_type":"box","text":"traded products.","page_number":145,"box":{"x":68,"y":406,"width":116,"height":11}},{"id":"c34ab852-a6da-40ba-9991-d9ce1857bf4d","block_type":"box","text":"F. Conflicts","page_number":145,"box":{"x":102,"y":429,"width":78,"height":9}},{"id":"e6137e2c-e163-4e59-950a-e31e0796168d","block_type":"box","text":"Additional Payments made by BlackRock to a Service Organization or its affiliates or other incentive","page_number":145,"box":{"x":101,"y":452,"width":710,"height":11}},{"id":"3fd80996-9ac4-497f-b338-cccb5d9d21b7","block_type":"box","text":"arrangements may be an impor tant factor in the Service Organization’s willingness to suppor t the sale of a Fund","page_number":145,"box":{"x":69,"y":467,"width":803,"height":11}},{"id":"80d9c43c-ae9d-4bf9-a1bd-9477fb920e68","block_type":"box","text":"and/or par ticular share class through its distribution system or to per form services with respect to such Fund.","page_number":145,"box":{"x":69,"y":482,"width":788,"height":11}},{"id":"79bdac81-2114-47e8-b34d-e41d7c72405f","block_type":"box","text":"Additional Payments and other incentive arrangements may also be impor tant factors in the Service Organization’s","page_number":145,"box":{"x":68,"y":497,"width":819,"height":11}},{"id":"5540720e-dcd0-4d32-9bcd-c0f1143b5961","block_type":"box","text":"willingness to recommend the BlackRock Fund complex in general.","page_number":145,"box":{"x":68,"y":512,"width":473,"height":11}},{"id":"25b0f6eb-e4ac-43c5-a442-99a7b8551244","block_type":"box","text":"BlackRock may be motivated to pay Additional Payments and other incentive compensation to promote the sale","page_number":145,"box":{"x":102,"y":535,"width":793,"height":11}},{"id":"c0d077cc-71a6-4952-94de-05feddf7e475","block_type":"box","text":"of Fund shares to Customers of Service Organizations and the retention of those investments by such Customers. To","page_number":145,"box":{"x":69,"y":550,"width":835,"height":11}},{"id":"193b799f-9df7-4c5a-9cbe-39a5669e82bd","block_type":"box","text":"the extent Service Organizations sell more shares of a Fund or retain shares of a Fund in their Customers’ accounts,","page_number":145,"box":{"x":68,"y":565,"width":833,"height":11}},{"id":"517b8c65-8c84-4c9a-87b7-b9d54583c907","block_type":"box","text":"BlackRock benefits from the incremental management and other fees paid by the Fund with respect to those assets.","page_number":145,"box":{"x":70,"y":580,"width":830,"height":11}},{"id":"cc03a31a-42ee-443d-9e50-1858a1bc3516","block_type":"box","text":"Service Organizations may have financial incentives for recommending a par ticular Fund, share class or fund","page_number":145,"box":{"x":102,"y":603,"width":774,"height":11}},{"id":"d400bfaf-17e5-41c2-8982-69eaa712cad8","block_type":"box","text":"complex over another. Service Organizations may charge their Customers additional fees in connection with the","page_number":145,"box":{"x":69,"y":618,"width":794,"height":11}},{"id":"429eef55-fa06-4dad-a928-ed8b6c001885","block_type":"box","text":"purchase or redemption of Fund shares or for account-related services which are in addition to the sales and other","page_number":145,"box":{"x":70,"y":633,"width":818,"height":11}},{"id":"a38ee2fc-3332-4b19-b3b5-07c4402f7e40","block_type":"box","text":"charges described in the Fund’s Prospectus and this SAI. Such charges may vary among Service Organizations but in","page_number":145,"box":{"x":69,"y":648,"width":836,"height":11}},{"id":"e3759bb5-b7ef-4167-a445-d4a806d427ee","block_type":"box","text":"all cases will be retained by the Service Organization and will not be remitted to a Fund or BlackRock.","page_number":145,"box":{"x":69,"y":663,"width":723,"height":12}},{"id":"765adfeb-9614-43f6-bc39-81202c7b0c02","block_type":"box","text":"Shareholders should consider whether such incentives exist when evaluating any recommendations from a","page_number":145,"box":{"x":102,"y":686,"width":759,"height":11}},{"id":"c52aba7e-2b2e-435d-8c8a-3628be34d296","block_type":"box","text":"Service Organization to purchase or sell shares of a Fund and when considering which share class is most","page_number":145,"box":{"x":69,"y":701,"width":760,"height":11}},{"id":"736ff88f-cc8e-4a66-b785-8863c47f70ae","block_type":"box","text":"appropriate.","page_number":145,"box":{"x":69,"y":716,"width":84,"height":11}},{"id":"e30cdf94-6e3e-43c0-806d-309fb56acbfe","block_type":"box","text":"You should consult with your Service Organization, and review carefully any disclosure by the Service","page_number":145,"box":{"x":160,"y":716,"width":738,"height":11}},{"id":"d82904a7-aeae-4690-8af3-175ff7677924","block_type":"box","text":"Organization, as to compensation received by it or its affiliates and for more information about the payments","page_number":145,"box":{"x":69,"y":731,"width":795,"height":11}},{"id":"3facb452-bc04-4d73-8214-ece4638b6b42","block_type":"box","text":"described above.","page_number":145,"box":{"x":69,"y":746,"width":122,"height":9}},{"id":"595313cf-65ed-4c68-a235-782017dc4e10","block_type":"box","text":"REDEMPTION OF SHARES","page_number":145,"box":{"x":385,"y":776,"width":208,"height":10}},{"id":"f3b0662b-1a3a-4767-84c3-091c67e98b36","block_type":"box","text":"Shares normally will be redeemed for cash upon receipt of a request in proper form, although each Fund retains","page_number":145,"box":{"x":102,"y":799,"width":798,"height":11}},{"id":"5ab8c7ad-4f3f-4821-9f47-18ad32e3042d","block_type":"box","text":"the right to redeem some or all of its shares in kind (valued in the same way as they would be valued for purposes of","page_number":145,"box":{"x":68,"y":814,"width":836,"height":11}},{"id":"2fd68f63-ce01-44f4-963a-29f1ed013d95","block_type":"box","text":"computing a Fund’s NAV), by delivery of securities and other assets selected from the Fund’s por tfolio holdings at the","page_number":145,"box":{"x":69,"y":829,"width":840,"height":11}},{"id":"5cc0098b-b0ca-4572-8764-26553043acaa","block_type":"box","text":"Manager’s discretion. In kind payment means payment will be made in por tfolio securities and other assets rather","page_number":145,"box":{"x":70,"y":844,"width":814,"height":11}},{"id":"f15580ec-21c5-4b5b-88a8-78493221dd18","block_type":"box","text":"than cash. Redemptions in kind may be used in applicable circumstances, generally if the relevant shareholder is","page_number":145,"box":{"x":68,"y":859,"width":809,"height":11}},{"id":"e379a50e-8629-4e11-b91d-6c9b7995112f","block_type":"box","text":"able to accept securities in kind, and may also be used in stressed market conditions. If this occurs, the redeeming","page_number":145,"box":{"x":69,"y":874,"width":827,"height":12}},{"id":"1ba3cfbc-cf72-4b71-b30e-1d2db940c15c","block_type":"box","text":"shareholder might incur brokerage or other transaction costs to conver t the securities and other assets to cash. Each","page_number":145,"box":{"x":69,"y":890,"width":839,"height":11}},{"id":"db2bf920-26e5-4466-ab1b-3381ce43884b","block_type":"box","text":"Fund has elected, however, to be governed by Rule 18f-1 under the Investment Company Act so that the Fund is","page_number":145,"box":{"x":70,"y":904,"width":797,"height":12}},{"id":"41568ab2-bd6f-4b7d-ac06-bed61726cc3c","block_type":"box","text":"II-114","page_number":145,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"c5d73575-17c1-408d-8c3a-5b5c75beb583","block_type":"box","text":"NM1026U-5982568-145/232","page_number":145,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"d8bf4d6a-7257-477e-8357-399e4f75f70c","block_type":"box","text":"obligated to redeem its shares solely in cash up to the lesser of $250,000 or 1% of its NAV during any 90-day period","page_number":146,"box":{"x":69,"y":44,"width":833,"height":12}},{"id":"fa3c8788-0910-4b74-b913-3da28fee2be0","block_type":"box","text":"for any shareholder of the Fund.","page_number":146,"box":{"x":68,"y":60,"width":227,"height":11}},{"id":"74f60177-505c-4399-a101-ddd06140fc98","block_type":"box","text":"The redemption price is the NAV per share next determined after the initial receipt of proper notice of","page_number":146,"box":{"x":101,"y":82,"width":722,"height":11}},{"id":"5af20794-790e-4e9e-bbf7-14810902ca5e","block_type":"box","text":"redemption. The value of shares of each Fund at the time of redemption may be more or less than your cost at the","page_number":146,"box":{"x":69,"y":98,"width":818,"height":11}},{"id":"fcdfdb7c-3510-457f-9e1b-173067190255","block_type":"box","text":"time of purchase, depending in par t on the market value of the securities held by the Fund at such time. Except for","page_number":146,"box":{"x":68,"y":113,"width":821,"height":11}},{"id":"d9d86d54-dc68-4e4b-8ebf-487cb7e108ae","block_type":"box","text":"any CDSC that may be applicable, there will be no redemption charge if your redemption request is sent directly to","page_number":146,"box":{"x":69,"y":128,"width":815,"height":11}},{"id":"4c20ea23-deec-49cf-912e-1473425f76fd","block_type":"box","text":"the Transfer Agent. If you are liquidating your holdings you will receive all dividends reinvested through the date of","page_number":146,"box":{"x":68,"y":143,"width":812,"height":11}},{"id":"ed3df964-949e-4113-9f24-65ecfa4f91ef","block_type":"box","text":"redemption.","page_number":146,"box":{"x":69,"y":158,"width":83,"height":11}},{"id":"4c5f2428-2263-4c87-8e9d-066f1538bb92","block_type":"box","text":"The right to redeem shares may be suspended or payment upon redemption may be delayed for more than seven","page_number":146,"box":{"x":101,"y":181,"width":807,"height":11}},{"id":"eccaf6ee-4080-453a-8d79-8ebef91e2816","block_type":"box","text":"days only (i) for any period during which trading on the NYSE is restricted as determined by the Commission or during","page_number":146,"box":{"x":69,"y":196,"width":835,"height":11}},{"id":"b25f85ef-e54c-4ed7-b11c-d898e8646e96","block_type":"box","text":"which the NYSE is closed (other than customary weekend and holiday closings), (ii) for any period during which an","page_number":146,"box":{"x":68,"y":211,"width":811,"height":11}},{"id":"6170deee-105b-42e4-8163-4c69b1b84756","block_type":"box","text":"emergency exists, as defined by the Commission, as a result of which disposal of por tfolio securities or","page_number":146,"box":{"x":69,"y":226,"width":741,"height":11}},{"id":"f8a9c7fb-3336-4dde-86ef-52c4b12d39b8","block_type":"box","text":"determination of the NAV of a Fund is not reasonably practicable, or (iii) for such other periods as the Commission","page_number":146,"box":{"x":69,"y":241,"width":813,"height":11}},{"id":"e2d21858-0376-4cba-a498-72607f977184","block_type":"box","text":"may by order permit for the protection of shareholders of the Fund. (A Fund may also suspend or postpone the","page_number":146,"box":{"x":69,"y":256,"width":787,"height":11}},{"id":"4a5330a5-b84a-470c-90ba-15b61ef06f91","block_type":"box","text":"recordation of the transfer of its shares upon the occurrence of any of the foregoing conditions.)","page_number":146,"box":{"x":69,"y":271,"width":685,"height":12}},{"id":"d1062187-83ec-44b6-b16a-8593fcd2460d","block_type":"box","text":"Each Fund, with other investment companies advised by the Manager, has entered into a joint committed line of","page_number":146,"box":{"x":102,"y":294,"width":798,"height":11}},{"id":"1ced47f5-84d2-453c-ae0f-87de93688e96","block_type":"box","text":"credit with a syndicate of banks that is intended to provide the Fund with a temporary source of cash to be used to","page_number":146,"box":{"x":69,"y":309,"width":820,"height":11}},{"id":"43482adc-6af5-4316-ba34-df2286db6fc4","block_type":"box","text":"meet redemption requests from shareholders in extraordinary or emergency circumstances.","page_number":146,"box":{"x":69,"y":324,"width":653,"height":12}},{"id":"44ba2667-9568-49dd-976b-bc422fdcd341","block_type":"box","text":"Each Fund may redeem shares involuntarily to reimburse the Fund for any loss sustained by reason of the failure","page_number":146,"box":{"x":102,"y":347,"width":803,"height":11}},{"id":"b76b421e-382d-431e-8c63-a18c5d5b3d1f","block_type":"box","text":"of a shareholder to make full payment for shares purchased by the shareholder or to collect any charge relating to a","page_number":146,"box":{"x":69,"y":362,"width":827,"height":11}},{"id":"1146768e-e9a9-4d22-b08c-bb332760c494","block_type":"box","text":"transaction effected for the benefit of a shareholder. Each Fund reserves the express right to redeem shares of the","page_number":146,"box":{"x":68,"y":377,"width":824,"height":12}},{"id":"5c819033-3b4f-42b8-a7db-dfa8096b873f","block_type":"box","text":"Fund involuntarily at any time if the Fund’s Board of Directors determines, in its sole discretion, that failure to do so","page_number":146,"box":{"x":70,"y":392,"width":825,"height":12}},{"id":"ea17631a-2df2-491f-ac86-9d04b2112db9","block_type":"box","text":"may have adverse consequences to the holders of shares in the Fund. Upon such redemption the holders of shares","page_number":146,"box":{"x":69,"y":407,"width":825,"height":12}},{"id":"258222c8-a4c9-4819-ab58-4f6ca12ce803","block_type":"box","text":"so redeemed shall have no fur ther right with respect thereto other than to receive payment of the redemption price.","page_number":146,"box":{"x":69,"y":423,"width":823,"height":11}},{"id":"91b46f1f-3a10-445d-83b9-bb2b31b08dba","block_type":"box","text":"Redemption","page_number":146,"box":{"x":69,"y":453,"width":86,"height":11}},{"id":"0a38504f-2ad5-43eb-813b-b95ad2382a55","block_type":"box","text":"Investor A, Investor A1, Investor C, Institutional and Class R Shares","page_number":146,"box":{"x":70,"y":476,"width":481,"height":10}},{"id":"2d6f8983-d688-45cc-b9c3-b0f769c00e85","block_type":"box","text":"Redeem by Telephone:","page_number":146,"box":{"x":102,"y":498,"width":162,"height":11}},{"id":"a658d408-11f2-4d39-be06-f21b773d6e11","block_type":"box","text":"You may sell Investor Shares, excluding Investor P Shares, held at BlackRock by","page_number":146,"box":{"x":270,"y":498,"width":571,"height":11}},{"id":"080d4656-4d7b-4805-b6c3-2515ded638ce","block_type":"box","text":"telephone request if cer tain conditions are met and if the amount being sold is less than (i) $100,000 for payments","page_number":146,"box":{"x":68,"y":513,"width":829,"height":12}},{"id":"7c110b92-c717-4608-88e9-2ba0231a649f","block_type":"box","text":"by check or (ii) $250,000 for payments through the Automated Clearing House Network (“ACH”) or wire transfer.","page_number":146,"box":{"x":69,"y":528,"width":798,"height":12}},{"id":"41d2b366-18f0-4671-bf83-dad02049f811","block_type":"box","text":"Cer tain redemption requests, such as those in excess of these amounts, and those where (i) the Fund does not have","page_number":146,"box":{"x":69,"y":543,"width":838,"height":12}},{"id":"28c6031e-0053-43ea-87dc-c95259c8404a","block_type":"box","text":"verified banking information on file; or (ii) the proceeds are not paid to the record owner at the record address, must","page_number":146,"box":{"x":68,"y":559,"width":831,"height":11}},{"id":"6df4e131-5bc5-419a-a82c-83398cf3a333","block_type":"box","text":"be in writing with a medallion signature guarantee provided by any “eligible guarantor institution” as defined in Rule","page_number":146,"box":{"x":69,"y":574,"width":822,"height":11}},{"id":"c3555971-5039-479e-9e5d-1b930de568bd","block_type":"box","text":"17Ad-15 under the Securities Exchange Act of 1934 (the “Exchange Act”), whose existence and validity may be","page_number":146,"box":{"x":70,"y":589,"width":791,"height":11}},{"id":"d6f0950e-1350-43d8-95e5-831f83ae35e7","block_type":"box","text":"verified by the Transfer Agent through the use of industry publications. For Institutional Shares, cer tain redemption","page_number":146,"box":{"x":68,"y":604,"width":818,"height":11}},{"id":"77ae54db-b045-4120-9d06-a6e7860c9bf0","block_type":"box","text":"requests may require written instructions with a medallion signature guarantee. Call (800) 441-7762 for details. You","page_number":146,"box":{"x":69,"y":619,"width":829,"height":11}},{"id":"72573fc3-2a93-4370-8a52-1b98f1f8526f","block_type":"box","text":"can obtain a medallion signature guarantee stamp from a bank, securities dealer, securities broker, credit union,","page_number":146,"box":{"x":69,"y":634,"width":803,"height":12}},{"id":"be1d66d8-a75e-469f-9f1f-1dc724caeabb","block_type":"box","text":"savings and loan association, national securities exchange or registered securities association. The three recognized","page_number":146,"box":{"x":69,"y":650,"width":834,"height":11}},{"id":"37b75f39-265f-405b-9699-7dcdb9c24bdb","block_type":"box","text":"medallion programs are Securities Transfer Agent Medallion Program, Stock Exchanges Medallion Program and New","page_number":146,"box":{"x":69,"y":664,"width":825,"height":12}},{"id":"081a4f72-2ada-4f2f-b366-8b53fbbd924b","block_type":"box","text":"York Stock Exchange, Inc. Medallion Signature Program. Signature guarantees which are not a par t of these programs","page_number":146,"box":{"x":68,"y":680,"width":840,"height":11}},{"id":"8ecf529f-7eb6-458e-b4cc-29dc2525c9fb","block_type":"box","text":"will not be accepted. A notary public seal will not be acceptable. Generally, a properly signed written request with any","page_number":146,"box":{"x":68,"y":695,"width":835,"height":11}},{"id":"4b84d6ee-0b45-4c45-b3a6-2372b27fcf1c","block_type":"box","text":"required signature guarantee is all that is required for a redemption. In some cases, however, other documents may","page_number":146,"box":{"x":69,"y":710,"width":828,"height":11}},{"id":"9f4629ad-22ab-4f0a-93f6-ddf387aed6c3","block_type":"box","text":"be necessary. Additional documentary evidence of authority is required by the Transfer Agent in the event redemption","page_number":146,"box":{"x":69,"y":725,"width":835,"height":11}},{"id":"637f04ef-b51f-4fcd-8a9f-867a620a6d14","block_type":"box","text":"is requested by a corporation, par tnership, trust, fiduciary, executor or administrator.","page_number":146,"box":{"x":70,"y":740,"width":603,"height":11}},{"id":"f3fdc702-4339-40e1-9963-b3f264b02155","block_type":"box","text":"If you make a redemption request before a Fund has collected payment for the purchase of shares, the Fund","page_number":146,"box":{"x":102,"y":763,"width":774,"height":11}},{"id":"95b97bf8-1f10-47cc-ad4a-8d77dccd1c0a","block_type":"box","text":"may delay mailing your proceeds. This delay will usually not exceed ten days. A Fund, its Administrators and the","page_number":146,"box":{"x":69,"y":778,"width":795,"height":11}},{"id":"f6ae457e-6c08-43bb-91a2-12ee4383e913","block_type":"box","text":"Distributor will employ reasonable procedures to confirm that instructions communicated by telephone are genuine.","page_number":146,"box":{"x":70,"y":793,"width":821,"height":11}},{"id":"7cfe39a1-a4d0-4409-a90f-a2c854f4b615","block_type":"box","text":"Telephone redemption requests will not be honored if: (i) the accountholder is deceased, (ii) the proceeds are to be","page_number":146,"box":{"x":68,"y":808,"width":823,"height":11}},{"id":"fcfbd314-cae6-4570-8486-572a7f483382","block_type":"box","text":"sent to someone other than the shareholder of record, (iii) a Fund does not have verified information on file, (iv) the","page_number":146,"box":{"x":69,"y":823,"width":823,"height":11}},{"id":"357427db-6e08-4f5c-baf0-d488e5a471d5","block_type":"box","text":"request is by an individual other than the accountholder of record, (v) the account is held by joint tenants who are","page_number":146,"box":{"x":69,"y":838,"width":809,"height":11}},{"id":"8279c066-b127-45d4-b58f-85107a9bc1d6","block_type":"box","text":"divorced, (vi) the address on the account has changed within the last 30 days or share cer tificates have been issued","page_number":146,"box":{"x":69,"y":853,"width":833,"height":12}},{"id":"44d8a7e8-205f-4ba6-b556-0280b4948120","block_type":"box","text":"on the account, or (vii) to protect against fraud, if the caller is unable to provide the account number, the name and","page_number":146,"box":{"x":69,"y":869,"width":821,"height":11}},{"id":"3fc06828-a296-4a39-a6ce-3200037a597c","block_type":"box","text":"address registered on the account and the social security number registered on the account. The Fund and its","page_number":146,"box":{"x":69,"y":884,"width":785,"height":11}},{"id":"a19bd4f1-84ad-46ce-af4a-0f365c60bc09","block_type":"box","text":"service providers will not be liable for any loss, liability, cost or expense for acting upon telephone instructions that","page_number":146,"box":{"x":69,"y":899,"width":820,"height":11}},{"id":"c89efa0b-7f2d-46ea-ad11-15e4fc3b5743","block_type":"box","text":"II-115","page_number":146,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"ee3f41e8-c7b4-4f3c-b494-ada3ff75ba0d","block_type":"box","text":"NM1026U-5982568-146/232","page_number":146,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"08a7c49c-89a4-4904-b667-289e042b5fa0","block_type":"box","text":"are reasonably believed to be genuine in accordance with such procedures. Before telephone requests will be","page_number":147,"box":{"x":69,"y":45,"width":782,"height":11}},{"id":"9d6ce27e-a484-494b-b760-0382697f6325","block_type":"box","text":"honored, signature approval from all shareholders of record on the account must be obtained. The Fund may refuse a","page_number":147,"box":{"x":69,"y":60,"width":838,"height":11}},{"id":"70097f9a-bd11-41e2-8ed8-d4002548e4ce","block_type":"box","text":"telephone redemption request if it believes it is advisable to do so. During periods of substantial economic or market","page_number":147,"box":{"x":68,"y":75,"width":837,"height":11}},{"id":"3003f589-7842-4242-97dc-f06c2a3d7f77","block_type":"box","text":"change, telephone redemptions may be difficult to complete. Please find below alternative redemption methods.","page_number":147,"box":{"x":69,"y":90,"width":800,"height":11}},{"id":"a30ef16a-a8c8-420f-b491-e563fece2820","block_type":"box","text":"Redemption orders for Institutional Shares placed prior to 4:00 p.m. (Eastern time) on a business day will be","page_number":147,"box":{"x":102,"y":113,"width":776,"height":11}},{"id":"d2a26377-e332-4fb4-9f1a-cd26985f2fc8","block_type":"box","text":"priced at the NAV determined that day. If redemption orders are received by 4:00 p.m. (Eastern time) on a business","page_number":147,"box":{"x":70,"y":128,"width":823,"height":11}},{"id":"f9c385a8-8f1a-4164-b2ac-b3c96c17dd08","block_type":"box","text":"day, payment for redeemed Institutional Shares will normally be wired in Federal Funds on the next business day. If","page_number":147,"box":{"x":69,"y":143,"width":820,"height":11}},{"id":"4bb720ea-c56d-40bf-9000-8977c53cf4ea","block_type":"box","text":"the Federal Reserve Bank of Philadelphia is not open on the business day following receipt of the redemption order,","page_number":147,"box":{"x":68,"y":158,"width":826,"height":11}},{"id":"846532e6-c23f-45ac-9b58-0d764c345810","block_type":"box","text":"the redemption order will be accepted and processed the next succeeding business day when the Federal Reserve","page_number":147,"box":{"x":68,"y":173,"width":817,"height":11}},{"id":"db4e3f95-248f-4dd6-b18b-6ac345a9bb6f","block_type":"box","text":"Bank of Philadelphia is open, provided that the Fund’s custodian is also open for business.","page_number":147,"box":{"x":70,"y":188,"width":648,"height":11}},{"id":"b7594684-dab2-4d84-b379-5589557be3ce","block_type":"box","text":"Redeem by VRU:","page_number":147,"box":{"x":102,"y":211,"width":120,"height":11}},{"id":"d91606be-2cab-4a67-9b8c-a56dbd15d26f","block_type":"box","text":"Investor class shares, excluding Investor P Shares, may also be redeemed by use of a Fund’s","page_number":147,"box":{"x":229,"y":211,"width":667,"height":11}},{"id":"9036aa56-5c4d-464d-b866-3dce3e79a7ec","block_type":"box","text":"automated voice response unit service (“VRU”). Payment for Investor class shares redeemed by VRU may be made","page_number":147,"box":{"x":69,"y":226,"width":820,"height":11}},{"id":"e9612b27-6f89-440e-b841-9e001a6a2486","block_type":"box","text":"for non-retirement accounts in amounts up to $25,000, either through check, ACH or wire.","page_number":147,"box":{"x":68,"y":241,"width":644,"height":11}},{"id":"71e945d7-726d-4b01-b479-1104c50aba2e","block_type":"box","text":"Redeem by Internet:","page_number":147,"box":{"x":102,"y":264,"width":147,"height":11}},{"id":"3e4cc23a-9467-4e14-a852-ef4e715ae25c","block_type":"box","text":"Cer tain Investor and Institutional class shares may also be redeemed by logging onto the","page_number":147,"box":{"x":255,"y":264,"width":637,"height":11}},{"id":"1ae97c31-ac29-4759-b16b-c29f57667649","block_type":"box","text":"BlackRock website at www.blackrock.com. Proceeds from Internet redemptions may be sent via check, ACH or wire to","page_number":147,"box":{"x":70,"y":279,"width":836,"height":11}},{"id":"30f52a50-3215-4a72-ac6d-70d0c994e62e","block_type":"box","text":"the bank account of record. Payment for shares redeemed by Internet may be made for non-retirement accounts up","page_number":147,"box":{"x":68,"y":294,"width":823,"height":11}},{"id":"09f3357a-9bcb-4354-8015-a473dfa7492e","block_type":"box","text":"to $100,000 per account per day, either through check, ACH or wire. Different maximums may apply to cer tain","page_number":147,"box":{"x":68,"y":309,"width":789,"height":11}},{"id":"23fe84cd-e25e-4a06-bb89-92bdf949f443","block_type":"box","text":"institutional investors.","page_number":147,"box":{"x":70,"y":325,"width":155,"height":8}},{"id":"e6d3fc9e-b1c7-4bb6-b477-0434dfa1bba3","block_type":"box","text":"Redeem in Writing:","page_number":147,"box":{"x":102,"y":347,"width":137,"height":11}},{"id":"438783de-9f2d-4aa9-86c5-63e24f11cfb3","block_type":"box","text":"If you hold shares with the Transfer Agent you may redeem such shares without charge by","page_number":147,"box":{"x":247,"y":347,"width":639,"height":11}},{"id":"86c0dafa-855d-4037-84df-bb0b47de7101","block_type":"box","text":"writing to BlackRock, P.O. Box 534429, Pittsburgh, Pennsylvania 15253-4429. Redemption requests delivered other","page_number":147,"box":{"x":68,"y":362,"width":831,"height":11}},{"id":"b76b0384-45e6-4958-b36e-f010687ae271","block_type":"box","text":"than by mail should be sent to BlackRock, Attention: 534429, 1350 Penn Avenue Suite 102, Pittsburgh,","page_number":147,"box":{"x":68,"y":377,"width":745,"height":12}},{"id":"0c3aa2f7-cff9-4658-840b-6ddeb60d438b","block_type":"box","text":"Pennsylvania 15222. If you hold share cer tificates issued by your Fund, the letter must be accompanied by","page_number":147,"box":{"x":69,"y":392,"width":764,"height":12}},{"id":"cb3fce29-e676-48d1-bbff-7d04305e2aa1","block_type":"box","text":"cer tificates for the shares. All shareholders on the account must sign the letter. A medallion signature guarantee will","page_number":147,"box":{"x":69,"y":407,"width":831,"height":12}},{"id":"fad38b79-b5d8-46d9-8544-e49b07357646","block_type":"box","text":"generally be required but may be waived in cer tain limited circumstances. You can obtain a medallion signature","page_number":147,"box":{"x":68,"y":423,"width":794,"height":11}},{"id":"220f6ca8-cc77-48d6-ab6b-b1d80f5a6ae3","block_type":"box","text":"guarantee stamp from a bank, securities dealer, securities broker, credit union, savings and loan association,","page_number":147,"box":{"x":68,"y":438,"width":782,"height":11}},{"id":"83b3852a-36f3-4566-b7a2-d9e6c75d02c4","block_type":"box","text":"national securities exchange or registered securities association. A notary public seal will not be acceptable. If you","page_number":147,"box":{"x":69,"y":453,"width":817,"height":11}},{"id":"1cf52532-1b4b-4fff-a833-2da02f035666","block_type":"box","text":"hold stock cer tificates, return the cer tificates with the letter. Proceeds from redemptions may be sent via check, ACH","page_number":147,"box":{"x":69,"y":468,"width":836,"height":11}},{"id":"5d8b830d-04b0-49ce-af2a-b67374fbba56","block_type":"box","text":"or wire to the bank account of record.","page_number":147,"box":{"x":69,"y":483,"width":266,"height":9}},{"id":"bba8f699-b8dc-4834-b3bd-d5c3309fed50","block_type":"box","text":"Redemptions of Investor P Shares, Service Shares, Class G Shares, Class K Shares and BlackRock Shares may","page_number":147,"box":{"x":102,"y":506,"width":802,"height":11}},{"id":"95e410a1-0bc9-4141-95fe-cb1ce5bb51c6","block_type":"box","text":"be made in the manner and amounts described in the Prospectuses.","page_number":147,"box":{"x":69,"y":521,"width":489,"height":11}},{"id":"6d94a441-11af-4238-a36c-91e78fb32483","block_type":"box","text":"The Funds or the Transfer Agent may temporarily suspend telephone transactions at any time.","page_number":147,"box":{"x":101,"y":543,"width":668,"height":12}},{"id":"47388a17-38d5-4b6f-aefd-001f1e7167e0","block_type":"box","text":"If you redeem shares directly with the Transfer Agent, payments will generally be mailed within one business day","page_number":147,"box":{"x":102,"y":566,"width":800,"height":11}},{"id":"9ba798d9-9b9f-4efa-bc94-8be8d8a2adfa","block_type":"box","text":"of receipt of the proper notice of redemption. A Fund may delay the mailing of a redemption check until good payment","page_number":147,"box":{"x":69,"y":581,"width":838,"height":12}},{"id":"dab43146-025e-4629-a1ae-347d9f504e03","block_type":"box","text":"(that is, cash, Federal funds or cer tified check drawn on a U.S. bank) has been collected for the purchase of Fund","page_number":147,"box":{"x":69,"y":596,"width":811,"height":11}},{"id":"b24b43cf-d115-464d-9c69-e8258820a164","block_type":"box","text":"shares, which delay will usually not exceed 10 days. If your account is held directly with the Transfer Agent and","page_number":147,"box":{"x":69,"y":612,"width":789,"height":11}},{"id":"d6b444e9-1ce9-4765-b54c-fa90cb2e8be5","block_type":"box","text":"contains a fractional share balance following a redemption, the fractional share balance will be automatically","page_number":147,"box":{"x":69,"y":627,"width":775,"height":11}},{"id":"f7f80b9d-7671-4989-9131-77393eb94218","block_type":"box","text":"redeemed by the Fund.","page_number":147,"box":{"x":69,"y":642,"width":162,"height":11}},{"id":"81378b70-a5ea-48d2-af97-53e86ec41a3e","block_type":"box","text":"Note on Low Balance Accounts.","page_number":147,"box":{"x":102,"y":665,"width":223,"height":8}},{"id":"14c76386-ca49-4f29-a4e8-775f418e3c89","block_type":"box","text":"Because of the high cost of maintaining smaller shareholder accounts,","page_number":147,"box":{"x":332,"y":664,"width":503,"height":12}},{"id":"b0a87c34-2631-402f-8524-0de4e7652451","block_type":"box","text":"BlackRock has set a minimum balance of $500 in each Fund position you hold within your account (“Fund","page_number":147,"box":{"x":70,"y":679,"width":752,"height":12}},{"id":"0d2c9e1c-e3f0-406b-aa69-c8f7a4d26943","block_type":"box","text":"Minimum”), and may redeem the shares in your account if the NAV of those shares in your account falls below $500","page_number":147,"box":{"x":70,"y":694,"width":829,"height":12}},{"id":"be298bf4-eb7c-4e1b-bc1d-8a7271681ca4","block_type":"box","text":"for any reason, including market fluctuation.","page_number":147,"box":{"x":68,"y":710,"width":313,"height":11}},{"id":"bbd2675e-133b-4c4a-a969-bed72cf58d91","block_type":"box","text":"You will be notified that the value of your account is less than the Fund Minimum before the Fund makes any","page_number":147,"box":{"x":101,"y":732,"width":775,"height":12}},{"id":"6c33d599-8582-418d-9cbc-9b8701e8214f","block_type":"box","text":"involuntary redemption. This notification will provide you with a 90 calendar day period to make an additional","page_number":147,"box":{"x":70,"y":748,"width":773,"height":11}},{"id":"c7f6d8aa-2559-4108-b688-24735ac10c1a","block_type":"box","text":"investment in order to bring the value of your account to at least $500 before the Fund makes an involuntary","page_number":147,"box":{"x":70,"y":762,"width":776,"height":12}},{"id":"0c717bc8-c563-4ab9-8929-be9984304793","block_type":"box","text":"redemption. This involuntary redemption will not charge any deferred sales charge, and may not apply to accounts of","page_number":147,"box":{"x":69,"y":778,"width":834,"height":11}},{"id":"686a1dac-37c1-4767-b44c-d7e62a92d5b0","block_type":"box","text":"cer tain employer-sponsored retirement plans (not including IRAs), qualified state tuition plan (529 Plan) accounts,","page_number":147,"box":{"x":69,"y":793,"width":811,"height":11}},{"id":"326e41a9-2191-4313-96d3-002c0f279cd8","block_type":"box","text":"and select fee-based programs at your financial intermediary.","page_number":147,"box":{"x":69,"y":808,"width":435,"height":11}},{"id":"d3b43f3b-c2cb-418a-bca6-f8af15d910cf","block_type":"box","text":"Redemptions in Kind:","page_number":147,"box":{"x":102,"y":831,"width":153,"height":11}},{"id":"1a33e27d-735b-4b6f-91de-184fd139fbb9","block_type":"box","text":"Each Fund reserves the right to honor any request for redemption by making payment in","page_number":147,"box":{"x":263,"y":831,"width":624,"height":11}},{"id":"8f39e838-8760-4d0b-aec5-b91d32c8b57c","block_type":"box","text":"whole or in par t by delivering securities valued in the same way as they would be valued for purposes of computing a","page_number":147,"box":{"x":68,"y":846,"width":833,"height":11}},{"id":"bf267589-9689-4192-8cc7-cabf32b8fcb1","block_type":"box","text":"Fund’s NAV, except that each Fund is obligated to redeem shares solely in cash up to the lesser of $250,000 or 1%","page_number":147,"box":{"x":70,"y":860,"width":825,"height":12}},{"id":"036dc0a8-4ef9-4694-9a45-0ddaf2caee20","block_type":"box","text":"of the Fund’s NAV during any 90-day period for any one shareholder. Redemptions in excess of those amounts will","page_number":147,"box":{"x":69,"y":876,"width":811,"height":11}},{"id":"693bf435-3094-4bb8-9ac3-786adb9dde1d","block_type":"box","text":"normally be paid in cash but may be paid wholly or par tly by a distribution in kind of securities.","page_number":147,"box":{"x":69,"y":891,"width":672,"height":11}},{"id":"b98d8f44-8a26-4fd5-b5cb-27af5607f43e","block_type":"box","text":"II-116","page_number":147,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"beea3347-8af5-477b-9d8b-61eceb86f411","block_type":"box","text":"NM1026U-5982568-147/232","page_number":147,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"52646d20-549c-4c3d-97c6-edec6a00ce8e","block_type":"box","text":"The specific security or securities to be distributed will be determined by the Manager and could include a pro","page_number":148,"box":{"x":101,"y":45,"width":787,"height":11}},{"id":"f18c485c-27a5-4454-bf97-7a3cbaa3a5b8","block_type":"box","text":"rata representation of the Fund’s por tfolio or a non-pro-rata representation of the Fund’s por tfolio depending upon","page_number":148,"box":{"x":69,"y":60,"width":812,"height":11}},{"id":"8852a8e2-9e20-4ccb-b0de-30a48e983b93","block_type":"box","text":"various circumstances and subject to the Funds’ policies and procedures and any applicable laws or regulations. In","page_number":148,"box":{"x":68,"y":75,"width":822,"height":11}},{"id":"ac4a1573-8056-463e-b52a-600f9cd14c81","block_type":"box","text":"effecting such redemption in kind, the Manager may select securities to distribute to the redeeming shareholder by","page_number":148,"box":{"x":69,"y":90,"width":822,"height":11}},{"id":"e4204c0f-dfd3-454a-acf4-8a2bcd45e1be","block_type":"box","text":"considering cer tain factors, including, without limitation, the por tfolio management team’s model or optimal por tfolio,","page_number":148,"box":{"x":69,"y":105,"width":838,"height":11}},{"id":"30c6224a-b998-4257-aa69-61268040f834","block_type":"box","text":"risk management considerations, compliance considerations, the active positioning of a Fund post-redemption, the","page_number":148,"box":{"x":69,"y":120,"width":818,"height":12}},{"id":"ab8bb5f2-63fe-44e5-a44a-426b2c335db3","block_type":"box","text":"liquidity of the securities, and the tax basis of the securities. There is no assurance that BlackRock will select to","page_number":148,"box":{"x":70,"y":135,"width":801,"height":11}},{"id":"e79f8802-5fb7-4eda-98a5-76563bb5ed77","block_type":"box","text":"retain those securities that will per form the best. An Index Fund may deviate from pro rata redemptions but will seek","page_number":148,"box":{"x":69,"y":150,"width":832,"height":12}},{"id":"76a6d74d-c409-4137-8ac6-903b2ebf612b","block_type":"box","text":"for the securities and other assets to be distributed to be deemed to be a fair representation of por tfolio holdings","page_number":148,"box":{"x":68,"y":166,"width":812,"height":11}},{"id":"62884b71-1bfd-4e7a-a6d7-08f242727694","block_type":"box","text":"and the interests of the remaining shareholders in the Index Fund to not be diluted.","page_number":148,"box":{"x":69,"y":181,"width":594,"height":11}},{"id":"2c5a4331-08fc-448e-b399-9e7c3d436417","block_type":"box","text":"The Funds may effect redemptions in kind in an effor t to, among other considerations: (a) manage the por tfolio","page_number":148,"box":{"x":101,"y":203,"width":795,"height":12}},{"id":"c3676fb3-832c-4543-a166-5b980c85ae73","block_type":"box","text":"efficiently or for any other por tfolio management purpose, and (b) externalize cer tain transaction costs that would","page_number":148,"box":{"x":69,"y":218,"width":810,"height":12}},{"id":"fd7e1e13-1863-4205-a0da-088f218277cf","block_type":"box","text":"otherwise be borne by a Fund in connection with redemption activity or por tfolio turnover. Redemptions in kind may","page_number":148,"box":{"x":69,"y":234,"width":820,"height":11}},{"id":"7d0796ce-30db-42c0-b381-af4787635ab1","block_type":"box","text":"reduce the need for the Fund to maintain shor t-term cash reserves, reduce Fund transaction costs, reduce the need","page_number":148,"box":{"x":69,"y":249,"width":828,"height":10}},{"id":"8cd86648-6b04-4e9e-bf6f-84855fc05528","block_type":"box","text":"for the Fund to sell its investments at inoppor tune times, and lower Fund capital gain recognition, all of which may be","page_number":148,"box":{"x":68,"y":264,"width":838,"height":11}},{"id":"cd774dce-1295-4110-ae0b-77d2dd98b1a7","block_type":"box","text":"considerations when determining whether to effect a redemption in kind. However, there can be no assurance that","page_number":148,"box":{"x":69,"y":279,"width":817,"height":11}},{"id":"917bf37e-ce96-4638-830c-8684d8d7961b","block_type":"box","text":"redemptions in kind can or will be effected when they would be beneficial to a Fund, and it may be impractical or","page_number":148,"box":{"x":69,"y":294,"width":802,"height":11}},{"id":"cb9f30e0-0801-4957-bfb3-66a16c10300e","block_type":"box","text":"impossible to effect redemptions in kind with many or substantially all of the Fund’s shareholders because of, among","page_number":148,"box":{"x":70,"y":309,"width":837,"height":11}},{"id":"650be3bd-c662-4070-90f5-5ec3c51376bb","block_type":"box","text":"other things, how they hold their Fund shares or the small value of the redemptions.","page_number":148,"box":{"x":69,"y":324,"width":598,"height":12}},{"id":"2420bcbc-cb37-4a63-b614-df5ed550f4cd","block_type":"box","text":"In some circumstances, in order to meet Fund liquidity needs, for optimization of the Fund’s por tfolio, or a","page_number":148,"box":{"x":102,"y":347,"width":756,"height":11}},{"id":"41756646-9ed9-4227-85c7-a3ce5baa9f04","block_type":"box","text":"combination thereof, a Fund, in its discretion, may accept large purchase orders from one or more financial","page_number":148,"box":{"x":69,"y":362,"width":764,"height":11}},{"id":"c8f6cd1c-2cb4-447b-a770-5faf33c1cc80","block_type":"box","text":"institutions that are willing, upon redemption of their investment in the Fund, to receive their redemption proceeds in","page_number":148,"box":{"x":70,"y":377,"width":830,"height":12}},{"id":"c7f0736a-6091-4ebc-b334-ef6286b4ed38","block_type":"box","text":"kind rather than in cash. A Fund’s ability to pay these redemption proceeds in kind relieves the Fund of the need of","page_number":148,"box":{"x":69,"y":392,"width":821,"height":12}},{"id":"3f711815-357f-4e10-8110-88cbde1e7e8c","block_type":"box","text":"the Fund to sell the securities that are distributed in kind and incur brokerage and other transaction costs associated","page_number":148,"box":{"x":68,"y":408,"width":837,"height":11}},{"id":"42386a5c-e1c6-4cdf-97ad-90980c6bfc56","block_type":"box","text":"with such sale, and may have the effect of reducing the amount of taxable gains the Fund would otherwise be","page_number":148,"box":{"x":68,"y":423,"width":784,"height":11}},{"id":"9902a064-f4db-4096-ac99-82bd68fda81e","block_type":"box","text":"required to distribute to shareholders. A Fund’s ability to engage in such transactions is subject to, among other","page_number":148,"box":{"x":69,"y":438,"width":801,"height":11}},{"id":"b438a671-35b1-4824-9cc1-8cb84ba28e85","block_type":"box","text":"things, limitations on frequency of redemptions in kind under the Fund’s policies and availability of shareholders able","page_number":148,"box":{"x":68,"y":453,"width":835,"height":11}},{"id":"6c2f7ec6-7fc9-489f-a53d-1dde61804c8e","block_type":"box","text":"to transact in kind, and there is no assurance that the Fund can or will effect any redemptions in kind. Financial","page_number":148,"box":{"x":68,"y":468,"width":796,"height":11}},{"id":"d228bed6-4e0e-4b9e-a90d-048d7a613062","block_type":"box","text":"institutions that par ticipate in the transactions described in this sub-section do not receive a fee from the Fund for","page_number":148,"box":{"x":70,"y":483,"width":816,"height":11}},{"id":"e55c217b-dace-491b-b16d-6d9bd2362800","block_type":"box","text":"doing so. The Funds’ shor t-term trading policy shall not apply to the transactions described in this sub-section.","page_number":148,"box":{"x":69,"y":498,"width":788,"height":11}},{"id":"9a78a88c-0a44-4d42-bd43-3c31a49f0170","block_type":"box","text":"If you receive securities through a redemption in kind, and desire to conver t them to cash, you may pay taxes","page_number":148,"box":{"x":102,"y":521,"width":779,"height":11}},{"id":"c9d72607-2eef-4e46-870d-77101cb5aa5f","block_type":"box","text":"and brokerage and other transaction costs to dispose of the securities. You may also receive less for the securities","page_number":148,"box":{"x":69,"y":536,"width":823,"height":11}},{"id":"01d2e3f0-ae49-47f4-b5e3-b56eddd6aa7b","block_type":"box","text":"than the price at which they were valued for purposes of effecting the redemption. There may also be a risk that","page_number":148,"box":{"x":68,"y":551,"width":800,"height":11}},{"id":"4854dd98-d7d5-4676-94ac-7cb3ba17f664","block_type":"box","text":"redemption in kind activity could negatively impact the market value of the securities distributed in kind and, in turn,","page_number":148,"box":{"x":69,"y":566,"width":826,"height":11}},{"id":"d00b34f5-c224-40c9-9bfc-8c53413c89c4","block_type":"box","text":"the NAV of the corresponding Fund.","page_number":148,"box":{"x":68,"y":581,"width":251,"height":12}},{"id":"887c7abe-47c1-4ca8-a52f-c2e73fa6abfd","block_type":"box","text":"Repurchase","page_number":148,"box":{"x":69,"y":612,"width":85,"height":11}},{"id":"1ba6b8e6-fa0b-4f65-8abb-f903f61147cd","block_type":"box","text":"A Fund normally will accept orders to repurchase shares from Selling Dealers for their customers. Shares will be","page_number":148,"box":{"x":101,"y":634,"width":800,"height":12}},{"id":"5507de0f-a424-4c5b-b564-5d009812be7d","block_type":"box","text":"priced at the NAV of the Fund next determined after receipt of the repurchase order by a Selling Dealer that has been","page_number":148,"box":{"x":70,"y":649,"width":833,"height":12}},{"id":"fa1d3f99-0da2-410c-ba02-82b3898fd7a8","block_type":"box","text":"authorized by the Distributor by contract to accept such orders. As to repurchase orders received by Selling Dealers","page_number":148,"box":{"x":69,"y":665,"width":822,"height":11}},{"id":"86ac838d-617d-40f6-b1a5-8b3b913bed8c","block_type":"box","text":"prior to the close of business on the NYSE (generally, the NYSE closes at 4:00 p.m. Eastern time), on the day the","page_number":148,"box":{"x":70,"y":680,"width":809,"height":11}},{"id":"107a876d-dabb-4130-9c34-233153effc59","block_type":"box","text":"order is placed, which includes orders received after the close of business on the previous day, the repurchase price","page_number":148,"box":{"x":69,"y":695,"width":831,"height":11}},{"id":"c5b39058-ad55-4eda-89e5-b994772c8f1b","block_type":"box","text":"is the NAV determined as of the close of business on the NYSE on that day. If the orders for repurchase are not","page_number":148,"box":{"x":70,"y":710,"width":796,"height":11}},{"id":"4f670913-a06e-4b13-8a2e-824eb3efdcdb","block_type":"box","text":"received by the Selling Dealer before the close of business on the NYSE, such orders are deemed received on the","page_number":148,"box":{"x":69,"y":725,"width":812,"height":11}},{"id":"796760d4-839a-4ea9-a2e5-ec311b4dbc76","block_type":"box","text":"next business day.","page_number":148,"box":{"x":69,"y":740,"width":130,"height":11}},{"id":"ac9d4972-be58-4616-9abf-0de00069fa43","block_type":"box","text":"These repurchase arrangements are for your convenience and do not involve a charge by the Fund (other than","page_number":148,"box":{"x":101,"y":763,"width":783,"height":11}},{"id":"16e5f9fa-7d6e-4431-8632-f391430257d6","block_type":"box","text":"any applicable CDSC or redemption fee). However, Selling Dealers may charge a processing fee in connection with","page_number":148,"box":{"x":69,"y":778,"width":813,"height":11}},{"id":"fb5c3da7-dffe-4fcd-822e-2a313c93cd0d","block_type":"box","text":"such transactions. In addition, securities firms that do not have selected dealer agreements with the Distributor may","page_number":148,"box":{"x":69,"y":793,"width":832,"height":11}},{"id":"750368b9-fe11-49f7-a33a-e6509805280f","block_type":"box","text":"impose a transaction charge for transmitting the notice of repurchase to the Fund. Each Fund reserves the right to","page_number":148,"box":{"x":70,"y":808,"width":814,"height":11}},{"id":"4ac13036-a68f-41cd-8e8d-563be1827fe6","block_type":"box","text":"reject any order for repurchase. A shareholder whose order for repurchase is rejected by a Fund, however, may","page_number":148,"box":{"x":69,"y":823,"width":788,"height":11}},{"id":"53145f77-99b2-4d40-b3b6-fff3336929de","block_type":"box","text":"redeem shares as set out above.","page_number":148,"box":{"x":69,"y":839,"width":235,"height":8}},{"id":"cafe5724-e935-4112-82b0-41ca80f4e45f","block_type":"box","text":"II-117","page_number":148,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"92d2c2d5-4da9-4bda-b443-e4e08e192f7a","block_type":"box","text":"NM1026U-5982568-148/232","page_number":148,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"facfbf20-9803-4041-a8d5-2fb1c6acb8b7","block_type":"box","text":"Reinstatement Privilege — Investor A and Investor P Shares","page_number":149,"box":{"x":69,"y":45,"width":440,"height":11}},{"id":"a735ff51-cba3-43c5-a52d-5c1d04195d8c","block_type":"box","text":"Upon redemption of Investor A, Investor A1, Investor P or Institutional Shares, as applicable, shareholders may","page_number":149,"box":{"x":102,"y":67,"width":791,"height":11}},{"id":"75d58173-5f8e-465b-bdc1-273d6dcc86b2","block_type":"box","text":"reinvest all or a por tion of their redemption proceeds (after paying any applicable CDSC) in Investor A or Investor P","page_number":149,"box":{"x":69,"y":82,"width":815,"height":12}},{"id":"acc83348-7e52-44c6-86c7-4bc6fd0ff076","block_type":"box","text":"Shares of the same or another BlackRock fund without paying a front-end sales charge. This right may be exercised","page_number":149,"box":{"x":69,"y":98,"width":822,"height":11}},{"id":"e49a039c-1e55-4c62-aa0f-2a5828824772","block_type":"box","text":"within 90 days of the redemption, provided that the Investor A or Investor P Shares, as applicable, of that fund is","page_number":149,"box":{"x":68,"y":113,"width":806,"height":11}},{"id":"8af64dc5-8b52-4433-a8c4-4edabb8c262d","block_type":"box","text":"currently open to new investors or the shareholder has a current account in that closed fund. Shares will be","page_number":149,"box":{"x":69,"y":128,"width":768,"height":11}},{"id":"53194e20-1528-4280-96c1-cc2df8b87e81","block_type":"box","text":"purchased at the NAV calculated at the close of trading on the day the request is received in good order. To exercise","page_number":149,"box":{"x":70,"y":143,"width":827,"height":11}},{"id":"a9718056-dfb8-42a5-8de1-9f960230b742","block_type":"box","text":"this privilege, the Transfer Agent must receive written notification from the shareholder of record or the registered","page_number":149,"box":{"x":68,"y":158,"width":809,"height":11}},{"id":"3a30f880-a44a-4c67-8255-f1560386899e","block_type":"box","text":"representative of record, at the time of purchase. Investors should consult a tax advisor concerning the tax","page_number":149,"box":{"x":69,"y":173,"width":764,"height":11}},{"id":"8fce2780-2746-4369-a594-ecc039b42dbe","block_type":"box","text":"consequences of exercising this reinstatement privilege.","page_number":149,"box":{"x":69,"y":188,"width":400,"height":12}},{"id":"a4327da5-9fab-400f-be0b-59dcd237bb58","block_type":"box","text":"SHAREHOLDER SERVICES","page_number":149,"box":{"x":384,"y":218,"width":210,"height":9}},{"id":"de5731c8-2391-48a3-9a4d-5cda50f8bcec","block_type":"box","text":"Each Fund offers one or more of the shareholder services described below that are designed to facilitate","page_number":149,"box":{"x":102,"y":241,"width":747,"height":11}},{"id":"f788adc7-1505-40e5-bb90-921cc0d98dc7","block_type":"box","text":"investment in its shares. You can obtain more information about these services from each Fund by calling the","page_number":149,"box":{"x":70,"y":256,"width":781,"height":11}},{"id":"c7c6df26-d5cf-462a-96f1-8fd82285d874","block_type":"box","text":"telephone number on the cover page, or from the Distributor, your financial adviser, your selected securities dealer or","page_number":149,"box":{"x":68,"y":271,"width":836,"height":11}},{"id":"3239bb55-66bd-451e-9fa3-4d38c75fdde5","block_type":"box","text":"other financial intermediary. Cer tain of these services are available only to U.S. investors.","page_number":149,"box":{"x":69,"y":286,"width":641,"height":11}},{"id":"c29f4ccb-8d63-40ac-a94e-cc09dd3e3dac","block_type":"box","text":"Investment Account","page_number":149,"box":{"x":69,"y":316,"width":146,"height":9}},{"id":"bda30146-8b43-4f9f-8b82-c3ac729ad70e","block_type":"box","text":"If your account is maintained at the Transfer Agent (an “Investment Account”) you will receive statements, at","page_number":149,"box":{"x":102,"y":339,"width":774,"height":11}},{"id":"bf855bc6-ff67-4ddf-a27c-ea2a9f8dd6bd","block_type":"box","text":"least quar terly, from the Transfer Agent. These statements will serve as confirmations for automatic investment","page_number":149,"box":{"x":70,"y":354,"width":796,"height":11}},{"id":"431de569-8606-4f61-a522-29ae6f980d9c","block_type":"box","text":"purchases and the reinvestment of dividends. The statements also will show any other activity in your Investment","page_number":149,"box":{"x":70,"y":369,"width":807,"height":11}},{"id":"240dfc69-62d3-40c5-91d5-a284e506cc0b","block_type":"box","text":"Account since the last statement. You also will receive separate confirmations for each purchase or sale transaction","page_number":149,"box":{"x":68,"y":384,"width":830,"height":11}},{"id":"d346b1ea-75c4-4e5c-b58b-b7e9ceb299b7","block_type":"box","text":"other than automatic investment purchases and the reinvestment of dividends. If your Investment Account is held at","page_number":149,"box":{"x":69,"y":399,"width":829,"height":11}},{"id":"fd986df9-0664-4f12-b946-6edb04b81096","block_type":"box","text":"the Transfer Agent you may make additions to it at any time by mailing a check directly to the Transfer Agent. Each","page_number":149,"box":{"x":68,"y":414,"width":815,"height":12}},{"id":"0244671d-54b2-4724-b066-1692cf73e2e8","block_type":"box","text":"Fund limits purchases by personal check to $500,000 per trade. You may also maintain an account through a","page_number":149,"box":{"x":70,"y":429,"width":781,"height":12}},{"id":"267127ae-0c04-4f93-a68a-553a689e47c9","block_type":"box","text":"selected securities dealer or other financial intermediary. If you transfer shares out of an account maintained with a","page_number":149,"box":{"x":69,"y":445,"width":825,"height":11}},{"id":"0db430c6-9877-49ad-af32-6ce047fde272","block_type":"box","text":"selected securities dealer or other financial intermediary, an Investment Account in your name may be opened","page_number":149,"box":{"x":69,"y":460,"width":785,"height":11}},{"id":"4524fd22-7680-49dc-b32e-472ce9e59b16","block_type":"box","text":"automatically at the Transfer Agent.","page_number":149,"box":{"x":69,"y":475,"width":251,"height":11}},{"id":"5630bfb7-628b-4672-bb7b-70979b3c6327","block_type":"box","text":"You may transfer Fund shares from a selected securities dealer or other financial intermediary to another","page_number":149,"box":{"x":101,"y":498,"width":750,"height":11}},{"id":"2450b3e3-5d48-45c1-b497-1edc33086649","block_type":"box","text":"securities dealer or other financial intermediary that has entered into an agreement with the Distributor. Cer tain","page_number":149,"box":{"x":69,"y":513,"width":797,"height":11}},{"id":"c73187bd-faa7-4954-bb5d-d74f75dc1149","block_type":"box","text":"shareholder services may not be available for the transferred shares. All future trading of these assets must be","page_number":149,"box":{"x":69,"y":528,"width":797,"height":11}},{"id":"0170eb3a-7851-476d-b7ae-2003a2893573","block_type":"box","text":"coordinated by the new firm. If you wish to transfer your shares to a securities dealer or other financial intermediary","page_number":149,"box":{"x":69,"y":543,"width":826,"height":11}},{"id":"b11a7993-df0d-4d53-9273-131c5e9a0342","block_type":"box","text":"that has not entered into an agreement with the Distributor, you must either (i) redeem your shares, paying any","page_number":149,"box":{"x":68,"y":558,"width":792,"height":11}},{"id":"70e74688-eda3-406d-9787-12c5ed4deb71","block_type":"box","text":"applicable CDSC or (ii) continue to maintain an Investment Account at the Transfer Agent for those shares. You also","page_number":149,"box":{"x":69,"y":573,"width":824,"height":11}},{"id":"d062f371-d1d2-4df9-8f35-ede2495405d7","block_type":"box","text":"may request that the new securities dealer or other financial intermediary maintain the shares in an account at the","page_number":149,"box":{"x":69,"y":588,"width":820,"height":11}},{"id":"28fb4ede-3823-4039-8625-de40f0aaa86e","block_type":"box","text":"Transfer Agent registered in the name of the securities dealer or other financial intermediary for your benefit whether","page_number":149,"box":{"x":68,"y":603,"width":833,"height":12}},{"id":"5df6ccf9-c4b8-47d4-88f1-a647e5665703","block_type":"box","text":"the securities dealer or other financial intermediary has entered into a selected dealer agreement or not. In the","page_number":149,"box":{"x":68,"y":618,"width":795,"height":12}},{"id":"7242750b-a135-4a17-86b3-d99fdb22ea0e","block_type":"box","text":"interest of economy and convenience and because of the operating procedures of each Fund, share cer tificates will","page_number":149,"box":{"x":70,"y":634,"width":822,"height":11}},{"id":"e67c2c35-5069-43e6-bf21-3eb9f4ea1337","block_type":"box","text":"not be issued physically. Shares are maintained by each Fund on its register maintained by the Transfer Agent and","page_number":149,"box":{"x":69,"y":649,"width":814,"height":11}},{"id":"5f147298-ea8e-41f6-b1bc-ad2c2a153e92","block_type":"box","text":"the holders thereof will have the same rights and ownership with respect to such shares as if cer tificates had been","page_number":149,"box":{"x":68,"y":664,"width":822,"height":11}},{"id":"8dee5a75-7560-49ab-b422-ec1781ef6d92","block_type":"box","text":"issued.","page_number":149,"box":{"x":70,"y":679,"width":49,"height":9}},{"id":"2fe35414-332f-4013-abd1-bb864ad1ddc2","block_type":"box","text":"If you are considering transferring a tax-deferred retirement account, such as an individual retirement account,","page_number":149,"box":{"x":102,"y":702,"width":785,"height":11}},{"id":"49b77027-394f-4f56-9853-6aed5f012899","block_type":"box","text":"from one selected securities dealer to another securities dealer or other financial intermediary, you should be aware","page_number":149,"box":{"x":68,"y":717,"width":830,"height":11}},{"id":"544d9a17-ca44-4118-9b24-ccf9e3da29a1","block_type":"box","text":"that if the new firm will not take delivery of shares of the Fund, you must either redeem the shares (paying any","page_number":149,"box":{"x":68,"y":732,"width":790,"height":11}},{"id":"28c456e8-0ab1-4784-9b44-b60a682ab01c","block_type":"box","text":"applicable CDSC) so that the cash proceeds can be transferred to the account at the new firm, or you must continue","page_number":149,"box":{"x":69,"y":747,"width":831,"height":11}},{"id":"e54a058c-0eb7-4c5e-a8ae-0a6598ac8250","block_type":"box","text":"to maintain a retirement account at the original selected securities dealer for those shares.","page_number":149,"box":{"x":68,"y":762,"width":652,"height":11}},{"id":"b94bbae2-81a0-41bc-86ae-1e48f7c7ad7a","block_type":"box","text":"Exchange Privilege","page_number":149,"box":{"x":69,"y":792,"width":138,"height":11}},{"id":"7bf3a87d-6b6b-471b-ba0a-ed260cc11bcb","block_type":"box","text":"U.S. shareholders of Investor A, Investor A1, Investor C, Investor P, Class K, Institutional and Class G Shares of","page_number":149,"box":{"x":102,"y":815,"width":797,"height":11}},{"id":"fdf3bf1f-c1f2-4486-ad13-f4b48efe7aff","block_type":"box","text":"each Fund have an exchange privilege with cer tain other Funds. However, Investor A1 Shares may only exchange out.","page_number":149,"box":{"x":69,"y":830,"width":832,"height":11}},{"id":"8a7cad7e-3f2e-4f03-b439-a7bc2b28212c","block_type":"box","text":"The minimum amount for exchanges of Investor class shares is $1,000, although you may exchange less than","page_number":149,"box":{"x":68,"y":845,"width":788,"height":12}},{"id":"496f1db3-7eac-4a71-9f46-a1e929caef9e","block_type":"box","text":"$1,000 if you already have an account in the Fund into which you are exchanging. You may only exchange into a","page_number":149,"box":{"x":69,"y":860,"width":796,"height":12}},{"id":"92d2ce8a-2680-4bdd-9602-ca2d9fa776e6","block_type":"box","text":"share class and a Fund that are open to new investors or in which you have a current account if the class or fund is","page_number":149,"box":{"x":69,"y":875,"width":824,"height":12}},{"id":"3eb89b17-5fab-4b90-8c97-bca149c39371","block_type":"box","text":"closed to new investors. Before effecting an exchange, you should obtain a currently effective prospectus of the fund","page_number":149,"box":{"x":69,"y":891,"width":835,"height":11}},{"id":"71470b26-0131-462e-83fa-1be318bfe00f","block_type":"box","text":"II-118","page_number":149,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"b923ca7f-c8a9-4c7a-87b0-4f5a51878990","block_type":"box","text":"NM1026U-5982568-149/232","page_number":149,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"cc027633-4f1c-460d-bc43-918580678ec3","block_type":"box","text":"into which you wish to make the exchange. Exercise of the exchange privilege is treated as a sale of the exchanged","page_number":150,"box":{"x":70,"y":45,"width":820,"height":11}},{"id":"ea4010b6-28ec-4cf4-9693-da20c04fa23e","block_type":"box","text":"shares and a purchase of the acquired shares for U.S. federal income tax purposes.","page_number":150,"box":{"x":69,"y":60,"width":600,"height":11}},{"id":"703eaffa-4aa3-4a4a-99d3-8f8a28957062","block_type":"box","text":"Exchanges of Investor A, Investor A1, Investor P, Class K, Institutional and Class G Shares.","page_number":150,"box":{"x":102,"y":82,"width":648,"height":12}},{"id":"9da2551a-e41c-4bda-a902-a8dac7923039","block_type":"box","text":"Institutional Shares","page_number":150,"box":{"x":757,"y":83,"width":137,"height":8}},{"id":"868314d5-b984-4f90-b3d2-643646a5de60","block_type":"box","text":"are exchangeable with Institutional Shares of other Funds. Investor A and Investor A1 Shares are exchangeable for","page_number":150,"box":{"x":69,"y":98,"width":817,"height":11}},{"id":"e9db6fc0-f2c8-421b-bda6-6885bb7d6180","block_type":"box","text":"Investor A Shares of other Funds to the extent such shares are offered by your financial intermediary. Investor P","page_number":150,"box":{"x":70,"y":113,"width":798,"height":11}},{"id":"56d46559-9a7a-4040-8d82-d8375e545488","block_type":"box","text":"Shares are exchangeable for Investor P Shares of other Funds, to the extent such shares are offered by your financial","page_number":150,"box":{"x":69,"y":128,"width":838,"height":11}},{"id":"072b0336-b47f-4850-8c03-8e33c062b6a9","block_type":"box","text":"intermediary. Class K Shares are exchangeable for Class K Shares of other Funds. Class G Shares are exchangeable","page_number":150,"box":{"x":70,"y":143,"width":834,"height":11}},{"id":"eb7fc7ab-f12d-43b0-b7ce-92cfa4aeabf0","block_type":"box","text":"for Class G Shares of other Funds.","page_number":150,"box":{"x":68,"y":158,"width":246,"height":9}},{"id":"2bf02893-3b06-4643-b6c4-c6dd20c4dbbe","block_type":"box","text":"Exchanges of Institutional Shares outstanding for Institutional Shares of a second fund or for shares of a money","page_number":150,"box":{"x":102,"y":181,"width":800,"height":11}},{"id":"c73a5e52-d476-409c-bffa-5d74d78dbd34","block_type":"box","text":"market fund are effected on the basis of relative NAV per Institutional Share. Exchanges of Investor A or Investor A1","page_number":150,"box":{"x":69,"y":196,"width":826,"height":11}},{"id":"5974c128-ab28-47a9-89b5-82c4b437dd5f","block_type":"box","text":"Shares outstanding (“outstanding Investor A Shares”) for Investor A Shares of a second fund, or for shares of a","page_number":150,"box":{"x":69,"y":211,"width":795,"height":11}},{"id":"01868048-ea66-4896-8e83-c27b8029ec6b","block_type":"box","text":"money market fund (“new Investor A Shares”) are effected on the basis of relative NAV per share. Exchanges of","page_number":150,"box":{"x":69,"y":226,"width":797,"height":11}},{"id":"60a7c3f6-cd23-4d94-b617-8f6350986202","block_type":"box","text":"Investor P Shares outstanding for Investor P Shares of a second fund are effected on the basis of relative NAV per","page_number":150,"box":{"x":70,"y":241,"width":814,"height":11}},{"id":"d1f56d0f-33e3-458f-8f24-d29ae367500d","block_type":"box","text":"share. Exchanges of Class K Shares outstanding for Class K Shares of a second fund, or for shares of a money","page_number":150,"box":{"x":69,"y":256,"width":796,"height":12}},{"id":"003fa487-05d2-44f5-bb8c-608a036dd168","block_type":"box","text":"market fund are effected on the basis of relative NAV per share. Exchanges of Class G Shares outstanding for Class","page_number":150,"box":{"x":69,"y":271,"width":828,"height":12}},{"id":"6a061e43-0522-4a9a-bec1-95999f554d96","block_type":"box","text":"G Shares of a second fund are effected on the basis of relative NAV per share.","page_number":150,"box":{"x":69,"y":286,"width":561,"height":11}},{"id":"25e48003-1b8a-4b69-9dab-41cc098a0c26","block_type":"box","text":"Exchanges of Investor C Shares.","page_number":150,"box":{"x":102,"y":309,"width":229,"height":11}},{"id":"c35bf9c7-4831-456d-83c9-6a4b5857f918","block_type":"box","text":"Shareholders of cer tain Funds with Investor C Shares outstanding (“outstanding","page_number":150,"box":{"x":338,"y":309,"width":570,"height":11}},{"id":"a7fe32d0-92cf-408e-a4fd-ac1b56836e12","block_type":"box","text":"Investor C Shares”) may exchange their shares for Investor C Shares of a second Fund (“new Investor C Shares”) or","page_number":150,"box":{"x":70,"y":324,"width":827,"height":12}},{"id":"5ebb0cba-49f3-4449-b309-4f9eab22035a","block_type":"box","text":"for shares of a money market fund (“new money market fund Shares”) on the basis of relative NAV per share, without","page_number":150,"box":{"x":68,"y":339,"width":839,"height":12}},{"id":"39fb06da-3cc9-4208-8f6b-71d6d2af11e2","block_type":"box","text":"the payment of any CDSC. Cer tain Funds impose different CDSC schedules. For purposes of computing the CDSC","page_number":150,"box":{"x":68,"y":355,"width":811,"height":11}},{"id":"a1dfe3f5-8d72-4fd2-8566-527b894cf539","block_type":"box","text":"upon redemption of new Investor C Shares or new money market fund Shares, as applicable, the time you held both","page_number":150,"box":{"x":69,"y":370,"width":827,"height":11}},{"id":"f60f65a6-f438-4a6c-b970-01fb1e91a029","block_type":"box","text":"the exchanged Investor C Shares and the new Investor C Shares or new money market fund Shares will count","page_number":150,"box":{"x":68,"y":385,"width":781,"height":11}},{"id":"a9c5e852-5a98-47e0-91bc-eb48c4633005","block_type":"box","text":"towards the holding period of the new Investor C Shares or new money market fund Shares.","page_number":150,"box":{"x":68,"y":400,"width":654,"height":11}},{"id":"42978ef0-29b9-429e-89c7-989fa72c478e","block_type":"box","text":"Exchanges of Service Shares.","page_number":150,"box":{"x":102,"y":423,"width":211,"height":11}},{"id":"76cd210c-4722-451c-be34-a7c122c44abc","block_type":"box","text":"Service Shares can be exchanged for Service Shares of Funds that are covered by","page_number":150,"box":{"x":319,"y":423,"width":588,"height":11}},{"id":"f85dcfb0-fea2-443d-9df4-b52d84ece244","block_type":"box","text":"selected dealer agreements with the Distributor.","page_number":150,"box":{"x":69,"y":438,"width":342,"height":11}},{"id":"f21c2a39-0b92-46b6-8348-358f75197b68","block_type":"box","text":"Exchanges for Shares of a Money Market Fund.","page_number":150,"box":{"x":102,"y":460,"width":335,"height":12}},{"id":"a3bb967c-4864-432e-9941-2b38c4d2e1e4","block_type":"box","text":"You may exchange any class of Investor class shares, excluding","page_number":150,"box":{"x":443,"y":460,"width":455,"height":12}},{"id":"9e126400-4191-4cb1-84a2-5c1643ea644f","block_type":"box","text":"Investor P Shares, for shares of an affiliated money market fund. If you exchange into BlackRock Summit Cash","page_number":150,"box":{"x":70,"y":475,"width":788,"height":12}},{"id":"b1025267-afc1-443a-a131-45cb49fd38f0","block_type":"box","text":"Reserves Fund (“Summit”), a series of BlackRock Financial Institutions Series Trust, you will receive one of two","page_number":150,"box":{"x":70,"y":491,"width":793,"height":11}},{"id":"47be89e3-0015-4ab3-b435-7aac0c3beace","block_type":"box","text":"classes of shares: exchanges of Investor A, Investor A1 and Institutional Shares of a Fund will receive Investor A","page_number":150,"box":{"x":69,"y":506,"width":802,"height":11}},{"id":"e63e0ded-7770-45f3-b928-5441e9697bf3","block_type":"box","text":"Shares of Summit and exchanges of Investor C Shares of a Fund will receive Investor C Shares of Summit. You may","page_number":150,"box":{"x":69,"y":521,"width":824,"height":11}},{"id":"cf2b59d0-4f4d-4f5b-b808-41abc0842004","block_type":"box","text":"exchange Investor A Shares of Summit back into Investor A or Institutional Shares of a Fund, if you are eligible to","page_number":150,"box":{"x":69,"y":536,"width":805,"height":11}},{"id":"9447e5bb-7e49-43f4-bbf4-2fa91e922a97","block_type":"box","text":"hold such shares. You may exchange Investor C Shares of Summit back into Investor C Shares of a Fund and, in the","page_number":150,"box":{"x":69,"y":551,"width":827,"height":11}},{"id":"23f6e248-21fc-4b27-a6b5-ab583b73b49b","block_type":"box","text":"event of such an exchange, the period of time that you held Investor C Shares of Summit will count toward","page_number":150,"box":{"x":69,"y":566,"width":758,"height":11}},{"id":"38df2913-ba34-4a30-bc62-185e8fc1bada","block_type":"box","text":"satisfaction of the holding period requirement for purposes of reducing any CDSC. Investor C Shares of Summit are","page_number":150,"box":{"x":69,"y":581,"width":822,"height":12}},{"id":"b592df81-c63d-46e1-8a03-fa1d7acac9d5","block_type":"box","text":"subject to a distribution fee at an annual rate of 0.75% of average daily net assets of such Investor C Shares.","page_number":150,"box":{"x":69,"y":596,"width":782,"height":12}},{"id":"59088f31-f804-40dc-b35a-0104c37cb2de","block_type":"box","text":"Exchanges of Investor C Shares of a money market fund other than Summit for Investor C Shares of a Fund will be","page_number":150,"box":{"x":70,"y":612,"width":814,"height":11}},{"id":"bfb763e3-fe61-4a5c-8cdc-1bbcf8c5ec55","block_type":"box","text":"exercised at NAV. However, a CDSC may be charged in connection with any subsequent redemption of the Investor C","page_number":150,"box":{"x":69,"y":627,"width":830,"height":11}},{"id":"df0bd882-7657-4ef7-b037-4510bb3de12f","block_type":"box","text":"Shares of the Fund received in the exchange. In determining the holding period for calculating the CDSC payable on","page_number":150,"box":{"x":69,"y":642,"width":821,"height":11}},{"id":"b18a36d1-1ca6-4922-a0ee-91bbe66c9071","block_type":"box","text":"redemption of Investor C Shares of the Fund received in the exchange, the holding period of the money market fund","page_number":150,"box":{"x":69,"y":657,"width":823,"height":11}},{"id":"3d3e41db-0584-4a0b-8c5e-eef257f5b47a","block_type":"box","text":"Investor C Shares originally held will be added to the holding period of the Investor C Shares acquired through","page_number":150,"box":{"x":70,"y":672,"width":781,"height":11}},{"id":"5929023f-eb44-4db4-a0db-6adca4a97586","block_type":"box","text":"exchange.","page_number":150,"box":{"x":69,"y":687,"width":70,"height":11}},{"id":"680921b0-fb80-4885-9ea5-b715505d6244","block_type":"box","text":"Exchanges by Par ticipants in Cer tain Programs.","page_number":150,"box":{"x":102,"y":710,"width":337,"height":11}},{"id":"887ececa-f60e-447a-9bb8-f6053be8491e","block_type":"box","text":"The exchange privilege may be modified with respect to cer tain","page_number":150,"box":{"x":445,"y":710,"width":448,"height":11}},{"id":"225cac1f-b104-4ca1-bb56-bf394d6b0373","block_type":"box","text":"par ticipants in mutual fund advisory programs and other fee-based programs sponsored by the Manager, an affiliate","page_number":150,"box":{"x":70,"y":725,"width":828,"height":11}},{"id":"0ce6457b-f326-46b7-8a23-f6257720a7a5","block_type":"box","text":"of the Manager, or selected securities dealers or other financial intermediaries that have an agreement with the","page_number":150,"box":{"x":69,"y":740,"width":796,"height":11}},{"id":"ac59c923-1f38-44d5-b8c7-fe1bda844068","block_type":"box","text":"Distributor. See “Fee-Based Programs” below.","page_number":150,"box":{"x":70,"y":755,"width":324,"height":11}},{"id":"0bb2fec9-dfae-4e28-8b03-cda3b5d524c2","block_type":"box","text":"Exercise of the Exchange Privilege.","page_number":150,"box":{"x":102,"y":778,"width":245,"height":11}},{"id":"a44dcfa6-bdfe-4c03-80b2-8c28b19e4ad3","block_type":"box","text":"To exercise the exchange privilege, you should contact your financial adviser","page_number":150,"box":{"x":353,"y":778,"width":543,"height":11}},{"id":"657e3640-bed9-49fd-88da-f1a7bbc384ac","block_type":"box","text":"or the Transfer Agent, who will advise each Fund of the exchange. If you do not hold share cer tificates, you may","page_number":150,"box":{"x":69,"y":793,"width":794,"height":11}},{"id":"37f8655e-c97c-47f9-9935-9d65e5068737","block_type":"box","text":"exercise the exchange privilege by wire through your securities dealer or other financial intermediary. Each Fund","page_number":150,"box":{"x":69,"y":808,"width":795,"height":11}},{"id":"46934040-e99d-4d91-bbe7-1862b4bd6d1e","block_type":"box","text":"reserves the right to require a properly completed exchange application.","page_number":150,"box":{"x":69,"y":823,"width":512,"height":12}},{"id":"0a62464a-e1b3-4dd7-ab58-3d536d040d78","block_type":"box","text":"A shareholder who wishes to make an exchange may do so by sending a written request to the Fund c/o the","page_number":150,"box":{"x":101,"y":846,"width":772,"height":11}},{"id":"55751a2a-b29a-4b9b-ba4d-ccbcf63e1d48","block_type":"box","text":"Transfer Agent at the following address: P.O. Box 534429, Pittsburgh, Pennsylvania 15253-4429. Shareholders are","page_number":150,"box":{"x":68,"y":861,"width":824,"height":11}},{"id":"620bb321-9bf5-48ff-a175-6ade18c59b4b","block_type":"box","text":"automatically provided with telephone exchange privileges when opening an account, unless they indicate on the","page_number":150,"box":{"x":69,"y":876,"width":801,"height":11}},{"id":"2dfee296-8431-4ebf-8d25-1880d421d849","block_type":"box","text":"Application that they do not wish to use this privilege. To add this feature to an existing account that previously did","page_number":150,"box":{"x":68,"y":891,"width":817,"height":12}},{"id":"f028ace0-00d8-49f6-99c3-0a387f74d557","block_type":"box","text":"not provide this option, a Telephone Exchange Authorization Form must be filed with the Transfer Agent. This form is","page_number":150,"box":{"x":69,"y":906,"width":826,"height":12}},{"id":"424513b6-9ef4-4865-9174-bb25dca7e01d","block_type":"box","text":"II-119","page_number":150,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"fe5f1144-782a-45b7-8490-be27b7abac31","block_type":"box","text":"NM1026U-5982568-150/232","page_number":150,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"7b31738a-bbae-4c71-96a3-68dc862bb6b4","block_type":"box","text":"available from the Transfer Agent. Once this election has been made, the shareholder may simply contact the Fund by","page_number":151,"box":{"x":69,"y":45,"width":840,"height":11}},{"id":"84a67766-79f7-4947-b46f-b761f96560f7","block_type":"box","text":"telephone at (800) 441-7762 to request the exchange. During periods of substantial economic or market change,","page_number":151,"box":{"x":68,"y":60,"width":811,"height":11}},{"id":"dad82ece-8313-4bd6-9078-03a3d1c5b2f8","block_type":"box","text":"telephone exchanges may be difficult to complete and shareholders may have to submit exchange requests to the","page_number":151,"box":{"x":68,"y":75,"width":815,"height":11}},{"id":"afa6697f-fce6-494c-b5d8-11bc1909de6c","block_type":"box","text":"Transfer Agent in writing.","page_number":151,"box":{"x":68,"y":90,"width":175,"height":11}},{"id":"9bf5d180-1d2c-46ac-b134-936f8cd96a34","block_type":"box","text":"If the exchanging shareholder does not currently own shares of the investment por tfolio whose shares are being","page_number":151,"box":{"x":102,"y":113,"width":800,"height":11}},{"id":"74fe171d-5082-425c-9292-0e2b32f102af","block_type":"box","text":"acquired, a new account will be established with the same registration, dividend and capital gain options and broker","page_number":151,"box":{"x":69,"y":128,"width":828,"height":11}},{"id":"a1bd18c1-a723-46f4-8bf4-f135448281f6","block_type":"box","text":"of record as the account from which shares are exchanged, unless otherwise specified in writing by the shareholder","page_number":151,"box":{"x":69,"y":143,"width":826,"height":11}},{"id":"00d6e44d-777c-47fc-9784-0236cbf7a84b","block_type":"box","text":"with all signatures guaranteed by an eligible guarantor institution as defined below. In order to par ticipate in the","page_number":151,"box":{"x":68,"y":158,"width":797,"height":11}},{"id":"75243735-9d2d-4ed2-8f7e-eed4667fef18","block_type":"box","text":"Automatic Investment Program or establish a Systematic Withdrawal Plan for the new account, however, an","page_number":151,"box":{"x":68,"y":173,"width":763,"height":11}},{"id":"29f379da-c936-4df5-818c-ea7557a10ba8","block_type":"box","text":"exchanging shareholder must file a specific written request.","page_number":151,"box":{"x":69,"y":188,"width":424,"height":12}},{"id":"97382c5d-dfd9-4bb4-ad43-916468102c08","block_type":"box","text":"Any share exchange must satisfy the requirements relating to the minimum initial investment requirement, and","page_number":151,"box":{"x":101,"y":211,"width":790,"height":11}},{"id":"8ef75cd0-f5f6-4988-8e35-ada9055ad8b1","block_type":"box","text":"must be legally available for sale in the state of the investor’s residence. For U.S. federal income tax purposes, a","page_number":151,"box":{"x":69,"y":226,"width":808,"height":11}},{"id":"2c032824-5663-437f-8c95-738e9f35e61b","block_type":"box","text":"share exchange is a taxable event and, accordingly, a capital gain or loss may be realized. Before making an","page_number":151,"box":{"x":69,"y":241,"width":771,"height":11}},{"id":"43d3aaa5-ef18-489f-862d-abee2ee0941b","block_type":"box","text":"exchange request, shareholders should consult a tax or other financial adviser and should consider the investment","page_number":151,"box":{"x":69,"y":256,"width":819,"height":12}},{"id":"07f7d048-3948-4907-9d16-0136141f30ca","block_type":"box","text":"objective, policies and restrictions of the investment por tfolio into which the shareholder is making an exchange.","page_number":151,"box":{"x":69,"y":271,"width":802,"height":12}},{"id":"d0b9903d-021c-4c9a-920b-c4ff7bb6f09d","block_type":"box","text":"Brokers may charge a fee for handling exchanges.","page_number":151,"box":{"x":70,"y":286,"width":354,"height":12}},{"id":"d761bdf4-62ae-45bf-9e35-e7aa3d4f8ca0","block_type":"box","text":"The Funds reserve the right to suspend, modify or terminate the exchange privilege at any time. Notice will be","page_number":151,"box":{"x":101,"y":309,"width":782,"height":11}},{"id":"a4b8469c-18c4-45de-8136-592caeea8618","block_type":"box","text":"given to shareholders of any material modification or termination except where notice is not required. The Funds","page_number":151,"box":{"x":68,"y":324,"width":800,"height":12}},{"id":"1049459f-7c7d-480c-b3b0-b10b693c9a3d","block_type":"box","text":"reserve the right to reject any telephone exchange request. Telephone exchanges may be subject to limitations as to","page_number":151,"box":{"x":69,"y":340,"width":831,"height":11}},{"id":"c5530b53-99f7-4c63-88cd-d75e030c01c1","block_type":"box","text":"amount or frequency, and to other restrictions that may be established from time to time to ensure that exchanges","page_number":151,"box":{"x":69,"y":355,"width":818,"height":11}},{"id":"b2a4e3fb-f329-4e1a-bfbe-165b0e21c09d","block_type":"box","text":"do not operate to the disadvantage of any por tfolio or its shareholders.","page_number":151,"box":{"x":69,"y":370,"width":506,"height":11}},{"id":"3a69f603-e436-4271-a6a3-8c8fcc090652","block_type":"box","text":"The Funds, the Administrators and BRIL will employ reasonable procedures to confirm that instructions","page_number":151,"box":{"x":101,"y":392,"width":733,"height":12}},{"id":"4d23a1eb-fc44-4f16-b2c4-01aa4e68f847","block_type":"box","text":"communicated by telephone are genuine. The Funds, the Administrators and BRIL will not be liable for any loss,","page_number":151,"box":{"x":69,"y":407,"width":793,"height":12}},{"id":"ad156d6a-bce3-4723-badd-c6365415f304","block_type":"box","text":"liability, cost or expense for acting upon telephone instructions reasonably believed to be genuine in accordance with","page_number":151,"box":{"x":70,"y":423,"width":832,"height":11}},{"id":"8711fb29-5ad9-4279-8436-969c99952654","block_type":"box","text":"such procedures. By use of the exchange privilege, the investor authorizes the Fund’s Transfer Agent to act on","page_number":151,"box":{"x":69,"y":438,"width":785,"height":11}},{"id":"ef6f3757-a580-4064-8b2f-afaac83c106d","block_type":"box","text":"telephonic or written exchange instructions from any person representing himself to be the investor and believed by","page_number":151,"box":{"x":68,"y":453,"width":825,"height":11}},{"id":"bbc7525b-1e8b-4f3a-97e7-37ed7f1857dd","block_type":"box","text":"the Fund’s Transfer Agent to be genuine. The records of the Fund’s Transfer Agent per taining to such instructions are","page_number":151,"box":{"x":68,"y":468,"width":837,"height":11}},{"id":"3ed2e717-6aeb-420c-b6c8-65838a622fd3","block_type":"box","text":"binding. The exchange privilege may be modified or terminated at any time upon 60 days’ notice to affected","page_number":151,"box":{"x":69,"y":483,"width":767,"height":11}},{"id":"d8fa1c47-146e-4f75-a1f9-aa589c0bb4da","block_type":"box","text":"shareholders. The exchange privilege is only available in states where the exchange may legally be made.","page_number":151,"box":{"x":69,"y":498,"width":750,"height":11}},{"id":"522fffc0-6815-46ec-b4d8-5338bf31f7d8","block_type":"box","text":"Each Fund reserves the right to limit the number of times an investor may exercise the exchange privilege.","page_number":151,"box":{"x":102,"y":521,"width":757,"height":11}},{"id":"2fc5a26e-3cfb-42ad-b2db-0b70153ca9e0","block_type":"box","text":"Cer tain Funds may suspend the continuous offering of their shares to the general public at any time and may resume","page_number":151,"box":{"x":69,"y":536,"width":837,"height":11}},{"id":"560772cf-2ae8-4506-858b-822cf0e8047d","block_type":"box","text":"such offering from time to time. The exchange privilege is available only to U.S. shareholders in states where the","page_number":151,"box":{"x":69,"y":551,"width":805,"height":11}},{"id":"04bf753e-962a-49fd-8ff8-584c60343b02","block_type":"box","text":"exchange legally may be made. The exchange privilege may be applicable to other new mutual funds whose shares","page_number":151,"box":{"x":69,"y":566,"width":817,"height":11}},{"id":"52869b38-1a28-43a6-9440-b9271ce20ac8","block_type":"box","text":"may be distributed by the Distributor.","page_number":151,"box":{"x":69,"y":582,"width":262,"height":10}},{"id":"20095d35-3f42-4294-aa28-f120e4af5b39","block_type":"box","text":"Participation in Fee-Based Programs","page_number":151,"box":{"x":69,"y":612,"width":266,"height":11}},{"id":"e1879e41-8090-467a-bb89-7b7d5407a04e","block_type":"box","text":"If you par ticipate in cer tain fee-based programs offered by BlackRock or an affiliate of BlackRock, or selected","page_number":151,"box":{"x":102,"y":634,"width":780,"height":12}},{"id":"3889b47e-085d-498a-b5f4-c60d91342925","block_type":"box","text":"securities dealers or other financial intermediaries that have agreements with the Distributor or in cer tain fee-based","page_number":151,"box":{"x":69,"y":649,"width":826,"height":12}},{"id":"ac46569c-10bb-48e7-acfa-d6e21e49fd73","block_type":"box","text":"programs in which BlackRock par ticipates, you may be able to buy Institutional Shares, including by exchanges from","page_number":151,"box":{"x":70,"y":664,"width":825,"height":12}},{"id":"a9b49a96-2cd6-4778-8792-b4105e5438f5","block_type":"box","text":"other share classes. Sales charges on the shares being exchanged may be reduced or waived under cer tain","page_number":151,"box":{"x":69,"y":680,"width":770,"height":11}},{"id":"fce5bca2-3ab1-4f81-8dfa-e04a39ff5d39","block_type":"box","text":"circumstances. You generally cannot transfer shares held through a fee-based program into another account. Instead,","page_number":151,"box":{"x":69,"y":695,"width":837,"height":11}},{"id":"63217c8a-5557-4ae7-80cb-a6703ffd114b","block_type":"box","text":"if you choose to leave the fee-based program, you may have to redeem your shares held through the program and","page_number":151,"box":{"x":70,"y":710,"width":808,"height":11}},{"id":"b61ad273-5b62-4e7f-9290-eb4bd4a4bf19","block_type":"box","text":"purchase shares of another class, which may be subject to distribution and service fees. This may be a taxable event","page_number":151,"box":{"x":70,"y":725,"width":838,"height":11}},{"id":"37dc9b94-17bc-4cd5-add3-820dae9b9273","block_type":"box","text":"and you may pay any applicable sales charges or redemption fee. Please speak to your financial intermediary for","page_number":151,"box":{"x":69,"y":740,"width":804,"height":11}},{"id":"9e57928b-9af3-450a-b46e-3b5233a5fb5d","block_type":"box","text":"information about specific policies and procedures applicable to your account.","page_number":151,"box":{"x":70,"y":755,"width":555,"height":11}},{"id":"a80f0c52-c98b-4ac5-9623-f26bdd7bbdec","block_type":"box","text":"Generally, upon termination of a fee-based program, the shares may be liquidated or the shares can be held in","page_number":151,"box":{"x":102,"y":778,"width":788,"height":11}},{"id":"efd20380-0efc-4ffc-92f3-68eeac0c7c1b","block_type":"box","text":"an account. In cer tain circumstances, when a shareholder chooses to continue to hold the shares, whatever share","page_number":151,"box":{"x":69,"y":793,"width":817,"height":10}},{"id":"1a9c9bea-0fa1-4b4b-9dc9-e78d58d089ac","block_type":"box","text":"class was held in the program can be held after termination. Shares that have been held for less than specified","page_number":151,"box":{"x":69,"y":808,"width":796,"height":11}},{"id":"dccb2c82-2759-49bf-be0b-99bc76bd96bc","block_type":"box","text":"periods within the program may be subject to a fee upon redemption. Shareholders that held Investor A or","page_number":151,"box":{"x":70,"y":823,"width":754,"height":12}},{"id":"6e4f6263-9ba9-4076-a1c4-1ad25250dec5","block_type":"box","text":"Institutional Shares in the program may be eligible to purchase additional shares of the respective share class of a","page_number":151,"box":{"x":70,"y":838,"width":820,"height":12}},{"id":"ce034d75-e1f2-4219-859c-e8e2ee22edaf","block_type":"box","text":"Fund, but may be subject to upfront sales charges with respect to Investor A Shares. Additional purchases of","page_number":151,"box":{"x":70,"y":853,"width":777,"height":12}},{"id":"89850bfc-576a-4b4e-82cb-b211f2a6fcd8","block_type":"box","text":"Institutional Shares are permitted only if you have an existing position at the time of purchase or are otherwise","page_number":151,"box":{"x":70,"y":869,"width":791,"height":11}},{"id":"7f117d45-1f32-4db7-997d-217e63226da6","block_type":"box","text":"eligible to purchase Institutional Shares. Please speak to your financial intermediary for more information.","page_number":151,"box":{"x":69,"y":884,"width":756,"height":11}},{"id":"dca451e4-b729-4f44-9ae9-66d5f29e9b36","block_type":"box","text":"II-120","page_number":151,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"beb34971-9dba-44c2-82ce-bb6b6ca6b6b3","block_type":"box","text":"NM1026U-5982568-151/232","page_number":151,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"a98b6d97-8142-45ea-8969-0650465940d3","block_type":"box","text":"Cer tain financial intermediaries may, in connection with a change in account type (for example, due to leaving a","page_number":152,"box":{"x":102,"y":45,"width":793,"height":11}},{"id":"ebc2ee3d-28f8-4d6d-b63d-3b78cf7662fc","block_type":"box","text":"fee-based program or upon termination of the fee-based program) or otherwise in accordance with the financial","page_number":152,"box":{"x":68,"y":60,"width":791,"height":11}},{"id":"b22152ec-6ee4-4078-882f-cd407c14ed9e","block_type":"box","text":"intermediary’s policies and procedures, exchange the share class held in the program for another share class of the","page_number":152,"box":{"x":70,"y":75,"width":830,"height":11}},{"id":"1fb0fc2c-11d4-4da5-a976-ea6adee80993","block_type":"box","text":"same fund, provided that the exchanged shares are not subject to a sales charge and the shareholder meets the","page_number":152,"box":{"x":69,"y":90,"width":807,"height":11}},{"id":"f0db969c-885c-411a-983e-626cc7b52487","block_type":"box","text":"eligibility requirements of the new share class. Please speak to your financial intermediary for information about","page_number":152,"box":{"x":69,"y":105,"width":801,"height":11}},{"id":"6131b69f-188e-46f6-a99a-9714d894aa4d","block_type":"box","text":"specific policies and procedures applicable to your account.","page_number":152,"box":{"x":69,"y":120,"width":424,"height":11}},{"id":"6323f729-5a31-4f33-ab0a-030be3e470d1","block_type":"box","text":"Details about the features of each fee-based program and the relevant charges, terms and conditions are","page_number":152,"box":{"x":102,"y":143,"width":752,"height":11}},{"id":"ff85a5dc-c177-46d3-93f6-1841cb66bb5d","block_type":"box","text":"included in the client agreement for each fee-based program and are available from your financial professional,","page_number":152,"box":{"x":70,"y":158,"width":789,"height":11}},{"id":"b93a214a-5d04-47c9-a3b7-bc754cd10c81","block_type":"box","text":"selected securities dealer or other financial intermediary. Please speak to your financial intermediary for more","page_number":152,"box":{"x":69,"y":173,"width":785,"height":11}},{"id":"dd197cda-6d46-4acc-a0a5-b138d07e1edb","block_type":"box","text":"information.","page_number":152,"box":{"x":70,"y":188,"width":83,"height":9}},{"id":"7ccc52de-1a42-41d9-90be-cd42823b8083","block_type":"box","text":"Retirement and Education Savings Plans","page_number":152,"box":{"x":69,"y":219,"width":296,"height":11}},{"id":"847e7770-e471-45ad-a1e1-9f36750c7720","block_type":"box","text":"Individual retirement accounts and other retirement and education savings plans are available from your financial","page_number":152,"box":{"x":102,"y":241,"width":805,"height":11}},{"id":"c00912ae-7006-4588-8f6c-51a350679e5a","block_type":"box","text":"intermediary. Under these plans, investments may be made in a Fund (other than a Municipal Fund) and cer tain of","page_number":152,"box":{"x":70,"y":256,"width":815,"height":11}},{"id":"a53f8040-6085-41ab-8306-343e451b78b9","block_type":"box","text":"the other mutual funds sponsored by the Manager or its affiliates as well as in other securities. There may be fees","page_number":152,"box":{"x":68,"y":271,"width":819,"height":12}},{"id":"e40d0047-8434-4674-9ddf-053a3deb8d7c","block_type":"box","text":"associated with investing through these plans. Information with respect to these plans is available on request from","page_number":152,"box":{"x":69,"y":286,"width":820,"height":12}},{"id":"fb9da522-a0ca-4ab4-99e7-cf7aa3944608","block_type":"box","text":"your financial intermediary.","page_number":152,"box":{"x":68,"y":302,"width":191,"height":11}},{"id":"869a0823-a2ce-4227-9c0f-882ef92dc2b2","block_type":"box","text":"Dividends received in each of the plans referred to above are exempt from U.S. federal taxation until distributed","page_number":152,"box":{"x":102,"y":324,"width":796,"height":11}},{"id":"edc51ace-7509-4649-b23d-6c44badb2aff","block_type":"box","text":"from the plans and, in the case of Roth IRAs and education savings plans, may be exempt from taxation when","page_number":152,"box":{"x":68,"y":339,"width":784,"height":12}},{"id":"1db83733-61e6-42a9-b9e4-54a63db4bfa0","block_type":"box","text":"distributed as well. Investors considering par ticipation in any retirement or education savings plan should review","page_number":152,"box":{"x":69,"y":355,"width":801,"height":11}},{"id":"77046bd6-971d-43a1-ac00-5a921fda5a3e","block_type":"box","text":"specific tax laws relating to the plan and should consult their attorneys or tax advisors with respect to the","page_number":152,"box":{"x":69,"y":370,"width":753,"height":11}},{"id":"e26e3ad7-f60f-4817-b6dc-fca5ae6d4eb2","block_type":"box","text":"establishment and maintenance of any such plan.","page_number":152,"box":{"x":69,"y":385,"width":354,"height":11}},{"id":"85c772fe-7065-422c-8aab-12c8929c2c3c","block_type":"box","text":"Automatic Investment Plans","page_number":152,"box":{"x":68,"y":415,"width":207,"height":9}},{"id":"5e1ce080-8a95-4625-b6d7-5fedcaaa69a4","block_type":"box","text":"Investor class shareholders and cer tain Service Share shareholders who were shareholders of the Compass","page_number":152,"box":{"x":102,"y":438,"width":773,"height":11}},{"id":"dcee1f16-6555-4795-bf1c-138f713798f9","block_type":"box","text":"Capital Group of Funds at the time of its combination with The PNC","page_number":152,"box":{"x":69,"y":453,"width":477,"height":11}},{"id":"efa60134-7131-4ba8-b0c6-61d107ed7ac9","block_type":"box","text":"®","page_number":152,"box":{"x":547,"y":453,"width":6,"height":5}},{"id":"70fd5547-ecea-4b2b-9f93-f3ad3ba097a8","block_type":"box","text":"Fund in 1996 may arrange for periodic","page_number":152,"box":{"x":559,"y":453,"width":272,"height":11}},{"id":"2d6d1ccc-1aaf-4d9c-8925-7afbcbc85fc4","block_type":"box","text":"investments in that Fund through automatic deductions from a checking or savings account. The minimum pre","page_number":152,"box":{"x":70,"y":468,"width":787,"height":11}},{"id":"f6a6f142-1638-4f9b-a451-6429abea82d7","block_type":"box","text":"authorized investment amount is $50. If you buy shares of a Fund through cer tain accounts, no minimum charge to","page_number":152,"box":{"x":69,"y":482,"width":822,"height":12}},{"id":"7f6c8baa-5489-42c7-9e71-d0317b72e928","block_type":"box","text":"your bank account is required. Contact your financial adviser or other financial intermediary for more information.","page_number":152,"box":{"x":68,"y":498,"width":805,"height":11}},{"id":"22ed9f6b-c861-4cc9-88b4-dbd35a8df4a8","block_type":"box","text":"Automatic Dividend Reinvestment Plan","page_number":152,"box":{"x":68,"y":529,"width":285,"height":8}},{"id":"5184181e-b256-40b2-8724-24a234f60be8","block_type":"box","text":"Each Fund will distribute substantially all of its net investment income and net realized capital gains, if any, to","page_number":152,"box":{"x":102,"y":551,"width":782,"height":11}},{"id":"341b96a5-2c2b-414b-b985-dd2ac0ce352d","block_type":"box","text":"shareholders. All distributions are automatically reinvested at NAV in the form of additional full and fractional shares","page_number":152,"box":{"x":69,"y":566,"width":828,"height":11}},{"id":"70fdf372-5774-4063-a829-439183da04d2","block_type":"box","text":"of the same class of shares of the relevant Fund unless a shareholder elects otherwise or as otherwise set for th in a","page_number":152,"box":{"x":69,"y":581,"width":839,"height":9}},{"id":"477f5f62-aa18-4f4b-82c0-d14235cab497","block_type":"box","text":"Fund’s prospectus. Such election, or any revocation thereof, must be made in writing to the Transfer Agent, and will","page_number":152,"box":{"x":70,"y":596,"width":822,"height":12}},{"id":"784311f9-7dda-4362-b047-b8295b862e1b","block_type":"box","text":"become effective with respect to dividends paid after its receipt by the Transfer Agent.","page_number":152,"box":{"x":69,"y":612,"width":614,"height":11}},{"id":"a7f72a70-e20e-4ff1-b5e0-525fcaa25a31","block_type":"box","text":"Systematic Withdrawal Plans","page_number":152,"box":{"x":68,"y":642,"width":214,"height":11}},{"id":"1d2ecc8f-9cf1-4ff6-98a3-7e5db577328d","block_type":"box","text":"Shareholders may receive regular distributions from their accounts via a Systematic Withdrawal Plan (“SWP”).","page_number":152,"box":{"x":102,"y":664,"width":780,"height":12}},{"id":"9a0bbaec-6b57-4988-8be4-78cc4aee168d","block_type":"box","text":"Upon commencement of the SWP, the account must have a current value of $10,000 or more in a Fund.","page_number":152,"box":{"x":70,"y":679,"width":742,"height":12}},{"id":"134d28a5-eac3-424d-a25c-8d8b214501c0","block_type":"box","text":"Shareholders may elect to receive automatic cash payments of $50 or more at any interval. You may choose any day","page_number":152,"box":{"x":69,"y":694,"width":834,"height":12}},{"id":"d1226a5b-8f6b-4ca5-94b5-e4d1801e1215","block_type":"box","text":"for the withdrawal. If no day is specified, the withdrawals will be processed on the 25th day of the month or, if such","page_number":152,"box":{"x":68,"y":710,"width":823,"height":11}},{"id":"a21f1f1e-47c8-46e8-b6ba-c5d1877323db","block_type":"box","text":"day is not a business day, on the prior business day and are paid promptly thereafter. An investor may utilize the SWP","page_number":152,"box":{"x":69,"y":725,"width":840,"height":11}},{"id":"d90532a3-3cc2-49b4-a6c9-e07c78565f35","block_type":"box","text":"by completing the Systematic Withdrawal Plan Application Form which may be obtained by visiting our website at","page_number":152,"box":{"x":69,"y":740,"width":800,"height":11}},{"id":"8c7606e4-227d-4802-9b5f-d7f643b6fed9","block_type":"box","text":"www.blackrock.com.","page_number":152,"box":{"x":68,"y":755,"width":142,"height":9}},{"id":"66d3c897-4528-448f-81a8-037c748fd3fa","block_type":"box","text":"Shareholders should realize that if withdrawals exceed income dividends their invested principal in the account","page_number":152,"box":{"x":102,"y":778,"width":789,"height":11}},{"id":"e9eafbcb-3eb8-4435-8e72-8c73e6dbfc40","block_type":"box","text":"will be depleted. To par ticipate in the SWP, shareholders must have their dividends automatically reinvested.","page_number":152,"box":{"x":68,"y":793,"width":774,"height":11}},{"id":"fa159d3d-bd92-455e-9a7b-cb624d686720","block_type":"box","text":"Shareholders may change or cancel the SWP at any time, upon written notice to the Fund, or by calling the Fund at","page_number":152,"box":{"x":69,"y":808,"width":815,"height":11}},{"id":"8f1a30fd-d34e-4c98-a372-d76016eccd8f","block_type":"box","text":"(800) 441-7762. Purchases of additional Investor A or Investor P Shares of the Fund concurrently with withdrawals","page_number":152,"box":{"x":69,"y":823,"width":817,"height":11}},{"id":"39248d3c-b457-4741-a4de-0b854bd1015c","block_type":"box","text":"may be disadvantageous to investors because of the sales charges involved and, therefore, are discouraged. No","page_number":152,"box":{"x":69,"y":838,"width":803,"height":12}},{"id":"e8f0776e-b5aa-4fc5-94fe-07cd52baa224","block_type":"box","text":"CDSC will be assessed on redemptions of Investor C Shares made through the SWP that do not exceed 12% of the","page_number":152,"box":{"x":69,"y":853,"width":820,"height":12}},{"id":"d78c6382-cc7f-46f3-852d-98aed3e2e1f3","block_type":"box","text":"original investment on an annualized basis. For example, monthly, quar terly and semi-annual SWP redemptions of","page_number":152,"box":{"x":69,"y":869,"width":810,"height":11}},{"id":"cc42c954-0d52-4c1e-bfb4-fd39c30c4b5d","block_type":"box","text":"II-121","page_number":152,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"d03e0940-0568-41c6-93f3-c2541330cace","block_type":"box","text":"NM1026U-5982568-152/232","page_number":152,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"ee001060-6dce-4679-8bc0-6c3871e02670","block_type":"box","text":"Investor C Shares will not be subject to the CDSC if they do not exceed 1% (monthly), 3% (quar terly) and 6% (semi","page_number":153,"box":{"x":70,"y":45,"width":816,"height":11}},{"id":"f5932052-d87f-4d3b-b8ec-a54fb3fe00fe","block_type":"box","text":"annually), respectively, of an account’s NAV on the redemption date. SWP redemptions of Investor C Shares in excess","page_number":153,"box":{"x":69,"y":60,"width":840,"height":11}},{"id":"cfa00510-d872-45ac-8a0a-8c9e04b71d80","block_type":"box","text":"of this limit are still subject to the applicable CDSC.","page_number":153,"box":{"x":69,"y":75,"width":367,"height":11}},{"id":"fb7ca420-14bb-44be-9acd-60e3e768cd12","block_type":"box","text":"For this reason, a shareholder may not par ticipate in the Automatic Investment Plan described above (see “How","page_number":153,"box":{"x":102,"y":98,"width":798,"height":11}},{"id":"e4d7b366-27a4-4d0e-b1e0-83e7e7bdd215","block_type":"box","text":"to Buy, Sell, Exchange and Transfer Shares” or “How to Buy, Sell and Exchange Shares,” as applicable, in the Fund’s","page_number":153,"box":{"x":68,"y":113,"width":834,"height":11}},{"id":"2c583ee8-ab6b-49d7-b243-d6105318a408","block_type":"box","text":"Prospectus) and the SWP at the same time.","page_number":153,"box":{"x":69,"y":128,"width":311,"height":11}},{"id":"de36d8ac-6102-463c-9c2d-5df1bcc07756","block_type":"box","text":"Dividend Allocation Plan","page_number":153,"box":{"x":69,"y":158,"width":176,"height":9}},{"id":"d5d3858f-1216-415c-a40f-8b1ccf365c75","block_type":"box","text":"The Dividend Allocation Plan, as applicable, allows shareholders to elect to have all their dividends and any other","page_number":153,"box":{"x":101,"y":181,"width":807,"height":11}},{"id":"4fd4a72b-a2f8-4175-b241-8807c4660059","block_type":"box","text":"distributions from any Eligible Fund (which means funds so designated by the Distributor from time to time)","page_number":153,"box":{"x":69,"y":196,"width":763,"height":11}},{"id":"ff8e0c7e-2916-409b-a7e2-7b0c56c68e51","block_type":"box","text":"automatically invested at NAV in one other such Eligible Fund designated by the shareholder, provided the account","page_number":153,"box":{"x":69,"y":211,"width":814,"height":11}},{"id":"95d850c7-0609-4271-883e-f4a13559ef08","block_type":"box","text":"into which the dividends and distributions are directed is initially funded with the requisite minimum amount.","page_number":153,"box":{"x":70,"y":226,"width":771,"height":11}},{"id":"68e0c333-f0c0-4c75-aacc-05170e1c6641","block_type":"box","text":"PRICING OF SHARES","page_number":153,"box":{"x":406,"y":256,"width":167,"height":9}},{"id":"43b7de74-15d5-4a33-8b70-52e1e9bd1a22","block_type":"box","text":"Determination of Net Asset Value","page_number":153,"box":{"x":69,"y":286,"width":243,"height":9}},{"id":"8d82a4be-78a2-470e-9050-c81d717e4291","block_type":"box","text":"Valuation of Shares.","page_number":153,"box":{"x":101,"y":309,"width":145,"height":9}},{"id":"8b21f75e-916b-4ee6-8d46-3dd7a4073fe6","block_type":"box","text":"The NAV for each class of shares of each Fund is generally calculated as of the close of","page_number":153,"box":{"x":252,"y":309,"width":626,"height":11}},{"id":"c0ec962d-8878-421d-8e86-f7e7785e391b","block_type":"box","text":"regular trading hours on the NYSE (currently 4:00 p.m. Eastern Time) on each business day the NYSE is open.","page_number":153,"box":{"x":69,"y":324,"width":785,"height":11}},{"id":"49b2540a-d3f9-4090-9a29-be3495ff1024","block_type":"box","text":"Valuation of assets held by a Fund is as follows:","page_number":153,"box":{"x":68,"y":339,"width":343,"height":11}},{"id":"e7bf0a50-bd9e-4e2e-8858-08cf140952e5","block_type":"box","text":"Equity Investments.","page_number":153,"box":{"x":102,"y":362,"width":143,"height":11}},{"id":"78128042-2c48-47ea-9eb3-8461c871d9bf","block_type":"box","text":"Equity securities traded on a recognized securities exchange (","page_number":153,"box":{"x":252,"y":362,"width":439,"height":11}},{"id":"ccba22fd-5f54-4fa8-bd55-60055064a96f","block_type":"box","text":"e.g.","page_number":153,"box":{"x":693,"y":363,"width":25,"height":10}},{"id":"56a8cd97-6837-4459-b752-26d6325a7fd8","block_type":"box","text":", NYSE), on separate","page_number":153,"box":{"x":720,"y":362,"width":147,"height":11}},{"id":"e8f4a43e-4279-4251-a25f-25f48ec033b8","block_type":"box","text":"trading boards of a securities exchange or through a market system that provides contemporaneous transaction","page_number":153,"box":{"x":68,"y":377,"width":799,"height":11}},{"id":"077ca62c-2600-46fa-a404-21808bab9741","block_type":"box","text":"pricing information (each, an “Exchange”) are valued using information obtained via independent pricing services,","page_number":153,"box":{"x":70,"y":392,"width":808,"height":11}},{"id":"e37f3794-57d3-4c07-9b60-7ce4cb18f9ca","block_type":"box","text":"generally at the Exchange closing price or if an Exchange closing price is not available, the last traded price on that","page_number":153,"box":{"x":68,"y":407,"width":820,"height":11}},{"id":"0763d202-abdf-4e36-8ec9-5b86218948b0","block_type":"box","text":"Exchange prior to the time as of which the assets or liabilities are valued. However, under cer tain circumstances,","page_number":153,"box":{"x":70,"y":422,"width":805,"height":11}},{"id":"19a1224f-ed3a-4975-b3f0-b77f099f2aaf","block_type":"box","text":"other means of determining current market value may be used. If an equity security is traded on more than one","page_number":153,"box":{"x":69,"y":437,"width":793,"height":11}},{"id":"b706408a-dcaf-4263-b9df-470c5d831de3","block_type":"box","text":"Exchange, the current market value of the security where it is primarily traded generally will be used. In the event that","page_number":153,"box":{"x":70,"y":452,"width":836,"height":11}},{"id":"7a456856-0f0a-4a8f-bf52-aacb1db90715","block_type":"box","text":"there are no sales involving an equity security held by a Fund on a day on which the Fund values such security, the","page_number":153,"box":{"x":68,"y":468,"width":815,"height":11}},{"id":"b9c525b5-bab5-4d10-adad-819b1ccd2d70","block_type":"box","text":"last bid (long positions) or ask (shor t positions) price, if available, will be used as the value of such security. If a Fund","page_number":153,"box":{"x":70,"y":482,"width":837,"height":12}},{"id":"8021fa38-545f-434b-8582-7cee38a69355","block_type":"box","text":"holds both long and shor t positions in the same security, the last bid price will be applied to securities held long and","page_number":153,"box":{"x":69,"y":498,"width":832,"height":11}},{"id":"9333dd42-1883-4f6c-9f60-a41a9c80db10","block_type":"box","text":"the last ask price will be applied to securities sold shor t. If no bid or ask price is available on a day on which a Fund","page_number":153,"box":{"x":68,"y":513,"width":828,"height":11}},{"id":"17d3deb2-49a4-4de2-ab6b-75144aa60f8a","block_type":"box","text":"values such security, the prior day’s price will be used, unless BlackRock determines that such prior day’s price no","page_number":153,"box":{"x":68,"y":528,"width":819,"height":11}},{"id":"df9bc5c3-25e8-4aa3-b119-bf5d0d080e2e","block_type":"box","text":"longer reflects the fair value of the security, in which case such asset would be treated as a Fair Value Asset (as","page_number":153,"box":{"x":70,"y":543,"width":798,"height":11}},{"id":"11d0c870-4efa-4e2d-a85a-cffc07ea7085","block_type":"box","text":"defined below).","page_number":153,"box":{"x":69,"y":558,"width":106,"height":11}},{"id":"2cfb4971-24bd-43a3-8a02-dc7f0c21e23c","block_type":"box","text":"Fixed-Income Investments.","page_number":153,"box":{"x":102,"y":581,"width":194,"height":9}},{"id":"fd80931f-3d59-42d0-ba65-afc7a95907d8","block_type":"box","text":"Fixed-income securities are generally valued using prices provided by dealers or","page_number":153,"box":{"x":304,"y":581,"width":565,"height":11}},{"id":"dac71e7c-c122-4267-9ed7-32a9d254d4c7","block_type":"box","text":"prices (including evaluated prices) supplied by the Fund’s approved independent third-par ty pricing services, each in","page_number":153,"box":{"x":70,"y":596,"width":825,"height":11}},{"id":"f2181f9e-26f1-4225-910f-873aaa40b006","block_type":"box","text":"accordance with the Valuation Procedures. The pricing services may use valuation models that utilize cer tain inputs","page_number":153,"box":{"x":69,"y":611,"width":823,"height":11}},{"id":"1c1b8591-0b25-4a4e-bef5-c2df232242ab","block_type":"box","text":"and assumptions to derive values, including transaction data (","page_number":153,"box":{"x":69,"y":626,"width":443,"height":11}},{"id":"60bdadc2-6972-4f00-9423-346e8618aed2","block_type":"box","text":"e.g.","page_number":153,"box":{"x":514,"y":628,"width":24,"height":9}},{"id":"02162e9a-c05c-4a66-b0f7-cda4b0f092f4","block_type":"box","text":", recent representative bids and offers), credit","page_number":153,"box":{"x":541,"y":626,"width":328,"height":11}},{"id":"56b46f35-01e3-486d-bc1a-6dd0365632e3","block_type":"box","text":"quality information, perceived market movements, news, and other relevant information and by other methods, which","page_number":153,"box":{"x":69,"y":641,"width":834,"height":11}},{"id":"87ea6368-b879-45cc-83f0-adc0d9677757","block_type":"box","text":"may include consideration of: yields or prices of securities of comparable quality, coupon, maturity and type;","page_number":153,"box":{"x":69,"y":656,"width":769,"height":11}},{"id":"3972899e-f1ec-4941-87a1-0fe4e060c308","block_type":"box","text":"indications as to values from dealers; general market conditions; and/or other factors and assumptions. Pricing","page_number":153,"box":{"x":70,"y":671,"width":797,"height":12}},{"id":"aa01eea7-173a-42c5-9f72-f917cbeda19f","block_type":"box","text":"services generally value fixed-income securities assuming orderly transactions of an institutional round lot size, but","page_number":153,"box":{"x":69,"y":686,"width":821,"height":12}},{"id":"a85d21cb-f1be-48fe-838b-96cc6d22c576","block_type":"box","text":"the Fund may hold or transact in such securities in smaller, odd lot sizes. Odd lots of securities in cer tain asset","page_number":153,"box":{"x":68,"y":702,"width":798,"height":11}},{"id":"63284ece-7b86-45e0-a0dd-3a15d0d86463","block_type":"box","text":"classes may trade at lower prices than institutional round lots, and the value ultimately realized when the securities","page_number":153,"box":{"x":69,"y":717,"width":825,"height":11}},{"id":"3a7ba13a-b2b8-4257-85f5-4c56474bc241","block_type":"box","text":"are sold could differ from the prices used by a Fund. The amor tized cost method of valuation may be used with","page_number":153,"box":{"x":69,"y":732,"width":791,"height":11}},{"id":"ff5e6a1f-8443-4ba5-96a6-aa85119ab6c1","block_type":"box","text":"respect to debt obligations with 60 days or less remaining to maturity unless such method does not represent fair","page_number":153,"box":{"x":69,"y":747,"width":814,"height":11}},{"id":"477d1674-c0cd-48d3-be1a-2ba277b6ce48","block_type":"box","text":"value. Cer tain fixed-income investments, including asset-backed and mor tgage related securities, may be valued","page_number":153,"box":{"x":68,"y":762,"width":802,"height":11}},{"id":"2ae13068-1bdf-4730-bd23-be0d4f7e8acb","block_type":"box","text":"based on valuation models that consider the estimated cash flows of each tranche of the issuer, establish a","page_number":153,"box":{"x":69,"y":777,"width":773,"height":11}},{"id":"f82f3760-de25-4d4e-8159-bd00836396e4","block_type":"box","text":"benchmark yield and develop an estimated tranche specific spread to the benchmark yield based on the unique","page_number":153,"box":{"x":69,"y":792,"width":795,"height":12}},{"id":"843d49fa-d32b-433e-8962-9de71c4d7b5e","block_type":"box","text":"attributes of the tranche.","page_number":153,"box":{"x":69,"y":807,"width":176,"height":9}},{"id":"00d254d3-e01c-4055-9c85-795c5169cfa5","block_type":"box","text":"Options, Futures, Swaps and Other Derivatives.","page_number":153,"box":{"x":101,"y":830,"width":344,"height":11}},{"id":"1abd78da-5713-4eed-b7b6-6f1409774fef","block_type":"box","text":"Exchange-traded equity options (except ETF options, equity","page_number":153,"box":{"x":453,"y":830,"width":416,"height":11}},{"id":"fee36e8c-85f8-4359-8e5d-8ceefa682e47","block_type":"box","text":"index options or those that are customized) for which market quotations are readily available are valued at the mean","page_number":153,"box":{"x":70,"y":845,"width":829,"height":11}},{"id":"6f50cc0f-f53f-4e0b-a295-5d91d19b084b","block_type":"box","text":"of the last bid and ask prices as quoted on the Exchange or the board of trade on which such options are traded. In","page_number":153,"box":{"x":69,"y":860,"width":824,"height":12}},{"id":"3ad57a0d-111b-42d8-851b-9d8252712086","block_type":"box","text":"the event that there is no mean price available for an exchange-traded equity option held by a Fund on a day on which","page_number":153,"box":{"x":68,"y":875,"width":838,"height":12}},{"id":"eb1e939e-fd43-456a-8ac1-eea0a21eee7a","block_type":"box","text":"the Fund values such option, the last bid (long positions) or ask (shor t positions) price, if available, will be used as","page_number":153,"box":{"x":68,"y":891,"width":820,"height":11}},{"id":"32a61e3c-ebe1-4f17-8695-1da3c2b95c39","block_type":"box","text":"the value of such option. If no bid or ask price is available on a day on which a Fund values such option, the prior","page_number":153,"box":{"x":68,"y":906,"width":808,"height":11}},{"id":"d19796da-26a7-4360-8872-43162c8eb442","block_type":"box","text":"II-122","page_number":153,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"384daa2f-3a20-4f31-8621-7e83656b456d","block_type":"box","text":"NM1026U-5982568-153/232","page_number":153,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"ef629068-10fd-4dbb-870c-329bdfffe577","block_type":"box","text":"day’s price will be used, unless BlackRock determines that such prior day’s price no longer reflects the fair value of","page_number":154,"box":{"x":69,"y":45,"width":824,"height":11}},{"id":"c0755512-e68c-4410-af01-3650ac51aee4","block_type":"box","text":"the option, in which case such option will be treated as a Fair Value Asset. Customized exchange-traded equity","page_number":154,"box":{"x":68,"y":60,"width":789,"height":11}},{"id":"debaee31-eabe-4582-98c8-d58853797a71","block_type":"box","text":"options, ETF options, equity index options and OTC derivatives, may be valued using a mathematical model which","page_number":154,"box":{"x":69,"y":75,"width":807,"height":11}},{"id":"28090e5b-1d4c-459e-928c-bc37a832b50b","block_type":"box","text":"may incorporate a number of market data factors. Financial futures contracts and options thereon, which are traded","page_number":154,"box":{"x":69,"y":90,"width":824,"height":11}},{"id":"25549bd6-49d7-448c-a976-4c9001af0bd3","block_type":"box","text":"on exchanges, are valued at their last sale price or settle price as of the close of such exchanges. Swap agreements","page_number":154,"box":{"x":69,"y":105,"width":833,"height":11}},{"id":"1daf9547-523d-4125-89f8-0adf6d77efe2","block_type":"box","text":"and other derivatives are generally valued daily based upon quotations from market makers or by a pricing service in","page_number":154,"box":{"x":69,"y":120,"width":830,"height":12}},{"id":"743e1454-a05e-49f3-9d50-5b5353e9d78c","block_type":"box","text":"accordance with the Valuation Procedures.","page_number":154,"box":{"x":69,"y":136,"width":301,"height":8}},{"id":"1ff6fc1b-5ecd-4df8-b181-7e451eec4ea1","block_type":"box","text":"Underlying Funds.","page_number":154,"box":{"x":102,"y":158,"width":128,"height":11}},{"id":"85f214c5-347e-4b87-9ee7-d742ac7919ae","block_type":"box","text":"Shares of underlying open-end funds that are not traded on an exchange (including money","page_number":154,"box":{"x":237,"y":158,"width":640,"height":11}},{"id":"389eaafe-d1f3-42df-b373-504581ce0b43","block_type":"box","text":"market funds) are valued at NAV. Shares of underlying exchange-traded closed-end funds or other ETFs will be valued","page_number":154,"box":{"x":69,"y":173,"width":830,"height":11}},{"id":"7724abba-708a-4e7d-8f24-9e18e42877a1","block_type":"box","text":"at their most recent closing price.","page_number":154,"box":{"x":69,"y":188,"width":238,"height":12}},{"id":"bb9d3983-3868-412a-96fb-d38033cdc6bb","block_type":"box","text":"General Valuation Information.","page_number":154,"box":{"x":101,"y":211,"width":220,"height":9}},{"id":"fe854771-076b-4aaf-bf76-31ba21d22335","block_type":"box","text":"Prices obtained from independent third-par ty pricing services, broker-dealers or","page_number":154,"box":{"x":328,"y":211,"width":564,"height":11}},{"id":"21d3aa58-886c-4fda-a417-4e84058a4983","block_type":"box","text":"market makers to value each Fund’s securities and other assets and liabilities are based on information available at","page_number":154,"box":{"x":69,"y":226,"width":831,"height":9}},{"id":"71673d59-a285-4d1f-8497-f4aeb8b288d9","block_type":"box","text":"the time the Fund values its assets and liabilities. In the event that a pricing service quotation is revised or updated","page_number":154,"box":{"x":68,"y":241,"width":828,"height":11}},{"id":"c87355e7-e18c-4bd0-baa4-fd2898a69f0b","block_type":"box","text":"subsequent to the day on which the Fund valued such security, the revised pricing service quotation generally will be","page_number":154,"box":{"x":69,"y":257,"width":829,"height":11}},{"id":"86d94816-e378-4929-88d7-ffb1809c2855","block_type":"box","text":"applied prospectively. Such determination will be made considering per tinent facts and circumstances surrounding","page_number":154,"box":{"x":69,"y":271,"width":817,"height":12}},{"id":"403a330f-de72-46c0-959a-f441e72c7d43","block_type":"box","text":"the revision.","page_number":154,"box":{"x":68,"y":287,"width":87,"height":9}},{"id":"777d612d-fc56-4d1d-b4b2-6647765e0a7e","block_type":"box","text":"In determining the market value of por tfolio investments, the Fund may employ independent third-par ty pricing","page_number":154,"box":{"x":102,"y":309,"width":784,"height":11}},{"id":"841e66f3-635f-42bd-83bc-dd67e912cd67","block_type":"box","text":"services, which may use, without limitation, evaluated pricing methods that take into consideration market indexes,","page_number":154,"box":{"x":69,"y":325,"width":823,"height":11}},{"id":"66b9988e-1b26-4db6-80b8-36793d437f9d","block_type":"box","text":"matrices, yield curves and other specified inputs and assumptions. This may result in the assets being valued at a","page_number":154,"box":{"x":69,"y":339,"width":818,"height":12}},{"id":"2c07dd88-f1c7-4f9a-89e1-8ee707e9e198","block_type":"box","text":"price different from the price that would have been determined had the evaluated pricing method not been used. The","page_number":154,"box":{"x":70,"y":355,"width":832,"height":11}},{"id":"bfd20f86-6468-472f-ac0e-fb776c8394fa","block_type":"box","text":"price the Fund could receive upon the sale of any par ticular por tfolio investment may differ from the Fund’s valuation","page_number":154,"box":{"x":70,"y":370,"width":832,"height":11}},{"id":"c5f99675-b91b-479d-be87-8a925047b046","block_type":"box","text":"of the investment, par ticularly for assets that trade in thin or volatile markets or that are valued using a fair valuation","page_number":154,"box":{"x":69,"y":385,"width":834,"height":11}},{"id":"f2776aec-82d3-467b-9121-cf6a42ef6257","block_type":"box","text":"methodology or a price provided by an independent pricing service. As a result, the price received upon the sale of an","page_number":154,"box":{"x":69,"y":400,"width":837,"height":11}},{"id":"f4a2d0ff-a14c-47c4-8796-ccc7154bf7c8","block_type":"box","text":"investment may be less than the value ascribed by the Fund, and the Fund could realize a greater than expected loss","page_number":154,"box":{"x":70,"y":415,"width":833,"height":11}},{"id":"0071fbb5-b05a-4f9b-b6c7-38b05bdc31cb","block_type":"box","text":"or lesser than expected gain upon the sale of the investment. The Fund’s ability to value its investment may also be","page_number":154,"box":{"x":69,"y":430,"width":827,"height":11}},{"id":"62c3d387-6827-4277-b2cd-bb724b51d1d5","block_type":"box","text":"impacted by technological issues and/or errors by pricing services or other third-par ty service providers.","page_number":154,"box":{"x":70,"y":446,"width":741,"height":11}},{"id":"b51c4703-ff56-4f96-996c-399a51576ccf","block_type":"box","text":"In the event that application of the methods of valuation discussed above result in a price for a security which is","page_number":154,"box":{"x":102,"y":468,"width":800,"height":11}},{"id":"14c4581e-0ef5-48d9-bee4-7f57212950d8","block_type":"box","text":"deemed not to be representative of the fair market value of such security, the security will be valued by, under the","page_number":154,"box":{"x":69,"y":483,"width":811,"height":11}},{"id":"81658328-b623-4b94-ac54-a90618627fab","block_type":"box","text":"direction of or in accordance with a method approved by BlackRock, the Fund’s valuation designee, as reflecting fair","page_number":154,"box":{"x":69,"y":498,"width":827,"height":11}},{"id":"e4d28c93-1b88-498e-a628-bd785ec671ef","block_type":"box","text":"value. All other assets and liabilities (including securities for which market quotations are not readily available) held","page_number":154,"box":{"x":68,"y":513,"width":824,"height":12}},{"id":"3ecb26b3-f7df-412d-ba1d-837c0401d0d3","block_type":"box","text":"by a Fund (including restricted securities and private market investments, as applicable) are valued at fair value as","page_number":154,"box":{"x":69,"y":528,"width":817,"height":12}},{"id":"86de48bb-49bf-4f3d-ae1f-cdbb12c4b184","block_type":"box","text":"determined in good faith by BlackRock pursuant to the Valuation Procedures. Any assets and liabilities which are","page_number":154,"box":{"x":69,"y":543,"width":802,"height":12}},{"id":"4a93ec8b-37a6-47c8-9e2b-5547e33a198d","block_type":"box","text":"denominated in a foreign currency are translated into U.S. dollars at the prevailing market rates.","page_number":154,"box":{"x":69,"y":559,"width":685,"height":11}},{"id":"4b841106-638c-42c8-bb83-153681793e8b","block_type":"box","text":"Cer tain of the securities acquired by the Funds may be traded on foreign exchanges or OTC markets on days on","page_number":154,"box":{"x":102,"y":581,"width":795,"height":12}},{"id":"b22021d4-a11a-408c-abf3-9492b80b0cc7","block_type":"box","text":"which a Fund’s NAV is not calculated. In such cases, the NAV of a Fund’s shares may be significantly affected on","page_number":154,"box":{"x":68,"y":596,"width":805,"height":12}},{"id":"220cd584-1d07-4c83-a29d-f1b94207261e","block_type":"box","text":"days when investors can neither purchase nor redeem shares of the Fund.","page_number":154,"box":{"x":69,"y":612,"width":529,"height":11}},{"id":"d88986f7-9ac8-4d6e-b0c1-ee474db19ae0","block_type":"box","text":"Fair Value.","page_number":154,"box":{"x":102,"y":634,"width":74,"height":9}},{"id":"9eb77ef8-1cb8-47b5-b8ca-15dcd9e77a01","block_type":"box","text":"When market quotations are not readily available or are believed by BlackRock to be unreliable, a","page_number":154,"box":{"x":183,"y":634,"width":693,"height":11}},{"id":"de99bf86-aa3a-4c69-8240-9c0da962f53c","block_type":"box","text":"Fund’s investments are valued at fair value (“Fair Value Assets”). Fair Value Assets are valued by BlackRock in","page_number":154,"box":{"x":70,"y":649,"width":785,"height":12}},{"id":"a2bda782-f1a4-4923-910b-bd1166991c74","block_type":"box","text":"accordance with the Valuation Procedures. Pursuant to Rule 2a-5 under the Investment Company Act, the Board of","page_number":154,"box":{"x":69,"y":664,"width":816,"height":12}},{"id":"03217871-6b07-45c3-81e9-022868ab71de","block_type":"box","text":"Directors has designated BlackRock as the valuation designee for the respective Funds for which it serves as","page_number":154,"box":{"x":70,"y":680,"width":779,"height":11}},{"id":"57fcf294-390b-4a6e-b543-bd12e886dc0c","block_type":"box","text":"investment adviser. BlackRock may reasonably conclude that a market quotation is not readily available or is","page_number":154,"box":{"x":70,"y":695,"width":773,"height":11}},{"id":"a0829ac4-2858-4c53-a716-de3db7e074e3","block_type":"box","text":"unreliable if, among other things, a security or other asset or liability does not have a price source due to its","page_number":154,"box":{"x":69,"y":710,"width":772,"height":11}},{"id":"ca6a131a-a777-4542-8eae-7de96c04094c","block_type":"box","text":"complete lack of trading, if BlackRock believes a market quotation from a broker-dealer or other source is unreliable","page_number":154,"box":{"x":69,"y":725,"width":826,"height":11}},{"id":"cd94e2ab-832a-4d54-9eff-22ea61e1b8ac","block_type":"box","text":"(","page_number":154,"box":{"x":69,"y":740,"width":3,"height":11}},{"id":"851ea011-7064-4cc0-a0bd-eae2f0fcee97","block_type":"box","text":"e.g.","page_number":154,"box":{"x":74,"y":742,"width":25,"height":9}},{"id":"5f1c0d8d-a5c2-42c9-a38c-4e3f02de1f1a","block_type":"box","text":", where it varies significantly from a recent trade, or no longer reflects the fair value of the security or other asset","page_number":154,"box":{"x":101,"y":740,"width":806,"height":11}},{"id":"783fd1fd-9493-48ed-916c-efec67ca2378","block_type":"box","text":"or liability subsequent to the most recent market quotation), or where the security or other asset or liability is only","page_number":154,"box":{"x":69,"y":755,"width":813,"height":11}},{"id":"58eb0d2d-654b-4757-9386-c3b4a047c57b","block_type":"box","text":"thinly traded or due to the occurrence of a significant event subsequent to the most recent market quotation. For this","page_number":154,"box":{"x":68,"y":770,"width":837,"height":12}},{"id":"a28675f3-2e83-4095-bc45-c85225871a1c","block_type":"box","text":"purpose, a “significant event” is deemed to occur if BlackRock determines, in its reasonable business judgment, that","page_number":154,"box":{"x":70,"y":785,"width":838,"height":12}},{"id":"71882a6f-eec3-43b0-91f0-db98e49501af","block_type":"box","text":"an event has occurred after the close of trading for an asset or liability but prior to or at the time of pricing a Fund’s","page_number":154,"box":{"x":69,"y":801,"width":824,"height":11}},{"id":"ba7a4116-1648-4a7c-bdec-9bedae266750","block_type":"box","text":"assets or liabilities, is likely to cause a material change to the last exchange closing price or closing market price of","page_number":154,"box":{"x":69,"y":816,"width":828,"height":11}},{"id":"7bc6174b-7df8-4782-a58e-164512260149","block_type":"box","text":"one or more assets held by, or liabilities of, the Fund. On any day the NYSE is open and a foreign market or the","page_number":154,"box":{"x":69,"y":831,"width":793,"height":11}},{"id":"c420ef3d-9eed-400d-9ca6-889c9973fe47","block_type":"box","text":"primary exchange on which a foreign asset or liability is traded is closed, such asset or liability will be valued using","page_number":154,"box":{"x":70,"y":846,"width":819,"height":11}},{"id":"71bfc086-1226-4d8d-9d10-d63078ee3833","block_type":"box","text":"the prior day’s price, provided that BlackRock is not aware of any significant event or other information that would","page_number":154,"box":{"x":68,"y":861,"width":810,"height":11}},{"id":"3388ca8d-ec12-4bea-b04c-25514f57b47f","block_type":"box","text":"cause such price to no longer reflect the fair value of the asset or liability, in which case such asset or liability would","page_number":154,"box":{"x":69,"y":876,"width":828,"height":11}},{"id":"cd7aacc8-d01e-42da-8248-38f37d477d96","block_type":"box","text":"be treated as a Fair Value Asset. For cer tain foreign assets, a third-par ty vendor supplies evaluated, systematic fair","page_number":154,"box":{"x":69,"y":891,"width":822,"height":12}},{"id":"3a41a5a6-5650-483e-a66e-374b329c0735","block_type":"box","text":"value pricing based upon the movement of a proprietary multi-factor model after the relevant foreign markets have","page_number":154,"box":{"x":68,"y":906,"width":814,"height":12}},{"id":"87da8ba8-3076-441e-84fa-a20b0fa3371c","block_type":"box","text":"II-123","page_number":154,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"645758d1-6c92-4fe1-b0f3-26bdf03447a5","block_type":"box","text":"NM1026U-5982568-154/232","page_number":154,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"42eb1d78-033b-4876-868a-0dc741caa6d8","block_type":"box","text":"closed. This systematic fair value pricing methodology is designed to correlate the prices of foreign assets in one or","page_number":155,"box":{"x":69,"y":45,"width":827,"height":11}},{"id":"e09dc4f4-3be4-4dba-87c3-5b9fddf30505","block_type":"box","text":"more non-U.S. markets following the close of the local markets to the prices that might have prevailed as of a Fund’s","page_number":155,"box":{"x":69,"y":60,"width":834,"height":11}},{"id":"08f77f19-b465-47c8-93f5-aebf90381524","block_type":"box","text":"pricing time.","page_number":155,"box":{"x":70,"y":75,"width":85,"height":11}},{"id":"95be8071-c4c4-4c97-833a-0aa4bce8e2ff","block_type":"box","text":"BlackRock’s Rule 2a-5 Committee is responsible for reviewing and approving methodologies by investment type","page_number":155,"box":{"x":102,"y":98,"width":794,"height":11}},{"id":"056ea02d-7253-4cd7-a93a-d1408be48283","block_type":"box","text":"and significant inputs used in the fair valuation of Fund assets or liabilities. In addition, the Funds’ accounting agent","page_number":155,"box":{"x":69,"y":113,"width":829,"height":11}},{"id":"c0f34c8a-c77d-443a-b7a2-a0b7e05db3eb","block_type":"box","text":"assists BlackRock by periodically endeavoring to confirm the prices it receives from all third-par ty pricing services,","page_number":155,"box":{"x":69,"y":128,"width":813,"height":11}},{"id":"0dc17cdf-298f-4873-b20a-daa2aca02806","block_type":"box","text":"index providers and broker-dealers. BlackRock regularly evaluates the values assigned to the securities and other","page_number":155,"box":{"x":70,"y":143,"width":808,"height":11}},{"id":"082441f2-2519-4f9f-990b-e4cce4e91148","block_type":"box","text":"assets and liabilities of the Funds.","page_number":155,"box":{"x":69,"y":158,"width":245,"height":9}},{"id":"3685a230-d1c1-4878-9fa3-6a8812bcd8d7","block_type":"box","text":"When determining the price for a Fair Value Asset, BlackRock will seek to determine the price that a Fund might","page_number":155,"box":{"x":101,"y":181,"width":795,"height":11}},{"id":"70e7f227-e8ad-40e9-9495-7769b15a4337","block_type":"box","text":"reasonably expect to receive from the current sale of that asset or liability in an arm’s-length transaction on the date","page_number":155,"box":{"x":69,"y":196,"width":832,"height":11}},{"id":"3e91b62f-5cc4-4e5f-85e9-b172e100a403","block_type":"box","text":"on which the asset or liability is being valued, and does not seek to determine the price a Fund might reasonably","page_number":155,"box":{"x":69,"y":211,"width":805,"height":11}},{"id":"48dca013-4d9e-4071-8b30-53fc66880047","block_type":"box","text":"expect to receive for selling an asset or liability at a later time or if it holds the asset or liability to maturity. Fair value","page_number":155,"box":{"x":69,"y":226,"width":834,"height":11}},{"id":"12eedad6-52b2-4b68-b212-bc8d5fcc1db5","block_type":"box","text":"determinations will be based upon all available factors that BlackRock deems relevant at the time of the","page_number":155,"box":{"x":69,"y":241,"width":744,"height":11}},{"id":"90f6160f-2067-4c9a-969f-26339ec1de9a","block_type":"box","text":"determination, and may be based on analytical values determined by BlackRock using proprietary or third-par ty","page_number":155,"box":{"x":69,"y":257,"width":791,"height":11}},{"id":"07bddac5-cfb0-4e17-b5bc-1a992d5d99e2","block_type":"box","text":"valuation models.","page_number":155,"box":{"x":68,"y":272,"width":125,"height":8}},{"id":"354b6b1c-b1ec-4fc5-a2d5-3cdfb05b3bd5","block_type":"box","text":"Fair value represents a good faith approximation of the value of an asset or liability. When determining the fair","page_number":155,"box":{"x":102,"y":294,"width":785,"height":11}},{"id":"b426cae7-6844-4a7e-94e0-d3e32dacc5f5","block_type":"box","text":"value of an investment, one or more fair value methodologies may be used (depending on cer tain factors, including","page_number":155,"box":{"x":68,"y":309,"width":822,"height":11}},{"id":"03eb3cfd-a786-46b6-af7b-2e2580a137ab","block_type":"box","text":"the asset type). For example, the investment may be initially priced based on the original cost of the investment or,","page_number":155,"box":{"x":68,"y":324,"width":820,"height":12}},{"id":"7e8a4a05-840f-400f-9aa7-6586a4ab1e59","block_type":"box","text":"alternatively, using proprietary or third-par ty models that may rely upon one or more unobservable inputs. Prices of","page_number":155,"box":{"x":69,"y":339,"width":818,"height":12}},{"id":"46d004be-2cdb-48f9-8ed9-52676d6c585a","block_type":"box","text":"actual, executed or historical transactions in the relevant investment (or comparable instruments) or, where","page_number":155,"box":{"x":69,"y":355,"width":766,"height":11}},{"id":"6d652ec3-5caf-4687-97ac-006108c0497b","block_type":"box","text":"appropriate, an appraisal by a third-par ty experienced in the valuation of similar instruments, may also be used as a","page_number":155,"box":{"x":69,"y":370,"width":828,"height":11}},{"id":"f2ac84c1-d7cf-4a69-af3e-60971ad98a0c","block_type":"box","text":"basis for establishing the fair value of an investment.","page_number":155,"box":{"x":69,"y":385,"width":378,"height":11}},{"id":"b5811da4-302f-4d2c-90cd-0bfeb5ad0ca3","block_type":"box","text":"The fair value of one or more assets or liabilities may not, in retrospect, be the price at which those assets or","page_number":155,"box":{"x":101,"y":407,"width":784,"height":12}},{"id":"f1b7e90e-e291-4bcf-9eba-3ebe969cd371","block_type":"box","text":"liabilities could have been sold during the period in which the par ticular fair values were used in determining a Fund’s","page_number":155,"box":{"x":70,"y":423,"width":836,"height":11}},{"id":"4830d697-2adb-4cac-b37e-62605235fc4a","block_type":"box","text":"NAV. As a result, a Fund’s sale or redemption of its shares at NAV, at a time when a holding or holdings are valued at","page_number":155,"box":{"x":70,"y":438,"width":834,"height":11}},{"id":"1c215889-697b-4339-8efc-20b2822fa02d","block_type":"box","text":"fair value, may have the effect of diluting or increasing the economic interest of existing shareholders.","page_number":155,"box":{"x":68,"y":453,"width":728,"height":11}},{"id":"716a9163-8293-4d29-9757-6d43187d64de","block_type":"box","text":"Each Fund’s annual audited financial statements, which are prepared in accordance with accounting principles","page_number":155,"box":{"x":102,"y":475,"width":786,"height":12}},{"id":"272673c3-2ef5-4c09-b09a-e7fadd5fbc65","block_type":"box","text":"generally accepted in the United States of America (“US GAAP”), follow the requirements for valuation set for th in","page_number":155,"box":{"x":68,"y":491,"width":809,"height":11}},{"id":"8ddc3cef-21c8-40e3-b105-bfd2631e59e3","block_type":"box","text":"Financial Accounting Standards Board Accounting Standards Codification Topic 820, “Fair Value Measurements and","page_number":155,"box":{"x":70,"y":506,"width":821,"height":11}},{"id":"6ebb0add-60db-4e8e-a544-5f3f432614ba","block_type":"box","text":"Disclosures” (“ASC 820”), which defines and establishes a framework for measuring fair value under US GAAP and","page_number":155,"box":{"x":70,"y":521,"width":818,"height":11}},{"id":"fe5b954c-4a59-4502-bca9-6d62de60971a","block_type":"box","text":"expands financial statement disclosure requirements relating to fair value measurements.","page_number":155,"box":{"x":69,"y":536,"width":641,"height":11}},{"id":"ca6330d1-2873-4dfc-b4b7-62ed5e163175","block_type":"box","text":"Generally, ASC 820 and other accounting rules applicable to funds and various assets in which they invest are","page_number":155,"box":{"x":102,"y":559,"width":786,"height":11}},{"id":"37548e21-b049-4133-bcf2-0a5823636efe","block_type":"box","text":"evolving. Such changes may adversely affect a Fund. For example, the evolution of rules governing the determination","page_number":155,"box":{"x":69,"y":574,"width":832,"height":11}},{"id":"aceb92e1-5026-4534-ac3c-177638ed66d0","block_type":"box","text":"of the fair market value of assets or liabilities, to the extent such rules become more stringent, would tend to","page_number":155,"box":{"x":69,"y":589,"width":780,"height":11}},{"id":"a1ea0d57-66f1-4959-802a-0840d8ab7be7","block_type":"box","text":"increase the cost and/or reduce the availability of third-par ty determinations of fair market value. This may in turn","page_number":155,"box":{"x":70,"y":604,"width":810,"height":11}},{"id":"e4cb6f5f-7e29-4077-bed3-123bf3b81835","block_type":"box","text":"increase the costs associated with selling assets or affect their liquidity due to a Fund’s inability to obtain a third","page_number":155,"box":{"x":70,"y":619,"width":810,"height":11}},{"id":"ab182331-5e73-40c7-9d1c-07d1d58f04d2","block_type":"box","text":"par ty determination of fair market value.","page_number":155,"box":{"x":70,"y":634,"width":285,"height":11}},{"id":"241b8212-12fe-4528-8752-442a0a969b6f","block_type":"box","text":"Computation of Offering Price Per Share","page_number":155,"box":{"x":69,"y":665,"width":292,"height":11}},{"id":"b16a6aba-152a-4038-be95-a935abec10f9","block_type":"box","text":"See “Computation of Offering Price Per Share” in Par t I of a Fund’s SAI for an illustration of the computation of","page_number":155,"box":{"x":102,"y":687,"width":791,"height":11}},{"id":"d75a4d1d-3b48-4ea4-9415-464370a25b77","block_type":"box","text":"the offering price for shares of your Fund.","page_number":155,"box":{"x":68,"y":702,"width":295,"height":12}},{"id":"568f0c73-6be5-491e-8e6e-9c6914371931","block_type":"box","text":"PORTFOLIO TRANSACTIONS AND BROKERAGE","page_number":155,"box":{"x":303,"y":732,"width":373,"height":10}},{"id":"9206c927-ccb8-4a44-92a8-18a0fb40b6e8","block_type":"box","text":"Transactions in Portfolio Securities","page_number":155,"box":{"x":68,"y":762,"width":257,"height":9}},{"id":"b100f1a7-5dd3-4fca-a9d2-ea1158f43ae3","block_type":"box","text":"Subject to policies established by the Board of Directors, BlackRock is primarily responsible for the execution of","page_number":155,"box":{"x":102,"y":785,"width":798,"height":11}},{"id":"3df60e5f-8875-4f73-88f9-b8736bf4a6ae","block_type":"box","text":"a Fund’s por tfolio transactions and the allocation of brokerage. BlackRock does not execute transactions through any","page_number":155,"box":{"x":69,"y":800,"width":839,"height":11}},{"id":"74076842-d9c7-40f4-8f5a-2f54ef260b17","block_type":"box","text":"par ticular broker or dealer, but seeks to obtain the best net results for the Fund, taking into account cer tain factors","page_number":155,"box":{"x":70,"y":815,"width":822,"height":11}},{"id":"afc14da6-e23e-491d-99d8-e9187eda819a","block_type":"box","text":"set out below. While BlackRock generally seeks reasonable trade execution costs, a Fund does not necessarily pay","page_number":155,"box":{"x":69,"y":830,"width":820,"height":11}},{"id":"4ff374c8-b606-4538-8df7-5e215cefde70","block_type":"box","text":"the lowest spread or commission available, and payment of the lowest commission or spread is not necessarily","page_number":155,"box":{"x":68,"y":845,"width":798,"height":11}},{"id":"d79abebb-2f68-4772-958a-239677c25336","block_type":"box","text":"consistent with obtaining the best price and execution in par ticular transactions. Subject to applicable legal","page_number":155,"box":{"x":69,"y":860,"width":765,"height":12}},{"id":"39422933-c2ad-4f96-aa01-129a3270d6c1","block_type":"box","text":"requirements, BlackRock may select a broker based par tly upon brokerage or research services provided to","page_number":155,"box":{"x":69,"y":876,"width":768,"height":11}},{"id":"7320847a-eaff-4c96-b976-d67a74839aa9","block_type":"box","text":"BlackRock and its clients, including a Fund. In return for such services, BlackRock may cause a Fund to pay a higher","page_number":155,"box":{"x":70,"y":891,"width":830,"height":11}},{"id":"27ad34e6-586d-4f21-ae49-472179acb6e3","block_type":"box","text":"II-124","page_number":155,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"e3d8b964-813e-4bb3-9f7a-703a332001b3","block_type":"box","text":"NM1026U-5982568-155/232","page_number":155,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"1c18fed7-ca1c-4327-8656-d59db3f6c91b","block_type":"box","text":"commission than other brokers would charge if BlackRock determines in good faith that the commission is","page_number":156,"box":{"x":69,"y":45,"width":760,"height":11}},{"id":"ee14ade4-a7b2-443b-92c4-c81df68133cf","block_type":"box","text":"reasonable in relation to the services provided.","page_number":156,"box":{"x":69,"y":60,"width":336,"height":11}},{"id":"179b0075-7a48-45a8-a1ac-d06b7b00134f","block_type":"box","text":"In the case of Feeder Funds, because each Feeder Fund generally invests exclusively in beneficial interests of a","page_number":156,"box":{"x":102,"y":82,"width":794,"height":12}},{"id":"d3ba8df2-d11b-40a8-9a84-55e3cf0d3ed5","block_type":"box","text":"Master Por tfolio, it is expected that all transactions in por tfolio securities will be entered into by the Master Por tfolio.","page_number":156,"box":{"x":70,"y":98,"width":835,"height":11}},{"id":"0c37ab16-980f-4e52-8418-567de3064dd1","block_type":"box","text":"In selecting brokers or dealers to execute por tfolio transactions, the Manager and sub-advisers seek to obtain","page_number":156,"box":{"x":102,"y":120,"width":784,"height":12}},{"id":"44ae8522-81f6-4545-8d6f-4b1c84b784ba","block_type":"box","text":"the best price and most favorable execution for a Fund, taking into account a variety of factors including: (i) the size,","page_number":156,"box":{"x":68,"y":135,"width":829,"height":12}},{"id":"bd21fa6f-6d79-458f-8219-7f04e397f9a5","block_type":"box","text":"nature and character of the security or instrument being traded and the markets in which it is purchased or sold;","page_number":156,"box":{"x":69,"y":150,"width":802,"height":12}},{"id":"9165469c-7ea7-42ff-a02c-0ed6bb1221c1","block_type":"box","text":"(ii) the desired timing of the transaction; (iii) BlackRock’s knowledge of the expected commission rates and spreads","page_number":156,"box":{"x":69,"y":166,"width":826,"height":11}},{"id":"3d71381e-07bb-47c0-9b7c-6e50fa5813a3","block_type":"box","text":"currently available; (iv) the activity existing and expected in the market for the par ticular security or instrument,","page_number":156,"box":{"x":69,"y":181,"width":789,"height":11}},{"id":"3d939f3d-a9f0-4402-9e96-3bba6db14651","block_type":"box","text":"including any anticipated execution difficulties; (v) the full range of brokerage services provided; (vi) the broker’s or","page_number":156,"box":{"x":70,"y":196,"width":818,"height":11}},{"id":"3d544d0b-d19c-4e4d-b10a-38fe92e2a796","block_type":"box","text":"dealer’s capital; (vii) the quality of research and research services provided; (viii) the reasonableness of the","page_number":156,"box":{"x":69,"y":211,"width":769,"height":11}},{"id":"b01cc026-6cb6-4804-a008-983479001e40","block_type":"box","text":"commission, dealer spread or its equivalent for the specific transaction; and (ix) BlackRock’s knowledge of any actual","page_number":156,"box":{"x":69,"y":226,"width":837,"height":11}},{"id":"ecc70379-b256-4395-baa6-3871055d27d5","block_type":"box","text":"or apparent operational problems of a broker or dealer.","page_number":156,"box":{"x":69,"y":241,"width":391,"height":11}},{"id":"5121aba8-cfc2-4dd7-a6f6-0613eb626497","block_type":"box","text":"Section 28(e) of the Exchange Act (“Section 28(e)”) permits an investment adviser, under cer tain circumstances","page_number":156,"box":{"x":102,"y":264,"width":801,"height":11}},{"id":"86d0fbb6-179e-4afe-97b8-7544baa259fb","block_type":"box","text":"to cause an account to pay a broker or dealer a commission for effecting a transaction that exceeds the amount","page_number":156,"box":{"x":68,"y":279,"width":802,"height":11}},{"id":"69b8fc60-df7d-41a3-8603-e642865cbbaf","block_type":"box","text":"another broker or dealer would have charged for effecting the same transaction in recognition of the value of","page_number":156,"box":{"x":69,"y":294,"width":775,"height":11}},{"id":"0dca69a8-8bc9-4ce2-b233-c6e902a7c5f5","block_type":"box","text":"brokerage and research services provided by that broker or dealer. This includes commissions paid on riskless","page_number":156,"box":{"x":69,"y":309,"width":790,"height":11}},{"id":"cc3ec52a-9732-4e46-ad6f-28406bb7c808","block_type":"box","text":"principal transactions under cer tain conditions. Brokerage and research services include: (1) furnishing advice as to","page_number":156,"box":{"x":70,"y":324,"width":827,"height":12}},{"id":"fa67b6a2-6f79-4788-bfd0-77a6df2055d1","block_type":"box","text":"the value of securities, including pricing and appraisal advice, credit analysis, risk measurement analysis,","page_number":156,"box":{"x":68,"y":339,"width":753,"height":12}},{"id":"9a7191c2-3406-4852-bfbb-ce5c6eb69bd0","block_type":"box","text":"per formance and other analysis, as well as the advisability of investing in, purchasing or selling securities, and the","page_number":156,"box":{"x":70,"y":355,"width":818,"height":11}},{"id":"dadf9eff-98ec-4cbd-9a68-9a9b52b1f91d","block_type":"box","text":"availability of securities or purchasers or sellers of securities; (2) furnishing analyses and repor ts concerning issuers,","page_number":156,"box":{"x":69,"y":370,"width":837,"height":11}},{"id":"adb6457a-b1fe-4372-9c48-9e892a28ccd6","block_type":"box","text":"industries, securities, economic factors and trends, por tfolio strategy, and the per formance of accounts; and","page_number":156,"box":{"x":70,"y":385,"width":775,"height":11}},{"id":"514ed42e-9c23-44b6-b4de-a37f73262f9e","block_type":"box","text":"(3) effecting securities transactions and per forming functions incidental to securities transactions (such as","page_number":156,"box":{"x":69,"y":400,"width":764,"height":11}},{"id":"457fbc3c-0145-425e-8d72-03cd4e0bae81","block_type":"box","text":"clearance, settlement, and custody). BlackRock believes that access to independent investment research is","page_number":156,"box":{"x":69,"y":415,"width":770,"height":11}},{"id":"c8179006-1c85-4ada-9a1a-fb8f9b0b22d4","block_type":"box","text":"beneficial to its investment decision-making processes and, therefore, to the Funds.","page_number":156,"box":{"x":69,"y":430,"width":599,"height":11}},{"id":"b4aa555f-5dbb-4411-b901-4605ba27f8f9","block_type":"box","text":"BlackRock, unless prohibited by applicable law, may par ticipate in client commission arrangements under which","page_number":156,"box":{"x":102,"y":453,"width":796,"height":11}},{"id":"44e8d48f-015d-400c-8f6f-9fb829193cef","block_type":"box","text":"BlackRock may execute transactions through a broker-dealer and request that the broker-dealer allocate a por tion of","page_number":156,"box":{"x":70,"y":468,"width":829,"height":11}},{"id":"0ffce827-4634-4d6c-b042-dd5cd4df3cc5","block_type":"box","text":"the commissions or commission credits to another firm that provides research to BlackRock. BlackRock believes that","page_number":156,"box":{"x":68,"y":483,"width":839,"height":11}},{"id":"8cdb62d5-4e24-48f2-8b0c-5148ab87bf69","block_type":"box","text":"research services obtained through soft dollar or commission sharing arrangements enhance its investment decision","page_number":156,"box":{"x":69,"y":498,"width":839,"height":11}},{"id":"edad6596-d7fc-4a79-9dc9-1433b3d09571","block_type":"box","text":"making capabilities, thereby increasing the prospects for higher investment returns. BlackRock will engage only in","page_number":156,"box":{"x":69,"y":513,"width":809,"height":12}},{"id":"3eaa7f03-312f-40ad-9f33-7c8940d4fc0a","block_type":"box","text":"soft dollar or commission sharing transactions that comply with the requirements of Section 28(e). Cer tain Funds","page_number":156,"box":{"x":69,"y":528,"width":808,"height":12}},{"id":"88c4efbf-cc1d-44d9-a864-cb705dd19e12","block_type":"box","text":"may be subject to additional regulations, including MiFID II. Under MiFID II, EU investment managers, including BIL,","page_number":156,"box":{"x":69,"y":544,"width":818,"height":11}},{"id":"f0f55a97-ad5e-4636-a6af-3cb47b279732","block_type":"box","text":"pay for any research out of their own resources and not through soft dollars or commission sharing arrangements.","page_number":156,"box":{"x":70,"y":559,"width":813,"height":11}},{"id":"ece82d82-60f5-4b1d-8912-2dd1a93c5938","block_type":"box","text":"BlackRock regularly evaluates the soft dollar products and services utilized, as well as the overall soft dollar and","page_number":156,"box":{"x":70,"y":574,"width":801,"height":11}},{"id":"5216fb6a-fd97-4851-8a08-eb68500f9daf","block_type":"box","text":"commission sharing arrangements to ensure that trades are executed by firms that are regarded as best able to","page_number":156,"box":{"x":69,"y":589,"width":802,"height":11}},{"id":"a59479ce-1750-4d63-95ba-823ae51384d1","block_type":"box","text":"execute trades for client accounts, while at the same time providing access to the research and other services","page_number":156,"box":{"x":69,"y":604,"width":790,"height":11}},{"id":"c3930828-0871-48a1-a189-908683d60997","block_type":"box","text":"BlackRock views as impactful to its trading results.","page_number":156,"box":{"x":70,"y":619,"width":361,"height":11}},{"id":"c480ed4a-9e62-4e14-bb67-c679dd80b85f","block_type":"box","text":"BlackRock, unless prohibited by applicable law, may utilize soft dollars and related services, including research","page_number":156,"box":{"x":102,"y":642,"width":791,"height":11}},{"id":"1a028089-c3b0-4a88-a264-c5bdaed6fed6","block_type":"box","text":"(whether prepared by the broker-dealer or prepared by a third-par ty and provided to BlackRock by the broker-dealer)","page_number":156,"box":{"x":69,"y":657,"width":819,"height":11}},{"id":"2e998eb5-4947-4738-9ddb-cc5d3f7d1d01","block_type":"box","text":"and execution or brokerage services within applicable rules and BlackRock’s policies to the extent that such","page_number":156,"box":{"x":69,"y":672,"width":772,"height":11}},{"id":"ba65765e-98bf-46f5-a137-5d5b600c6762","block_type":"box","text":"permitted services do not compromise BlackRock’s ability to seek to obtain best execution. In this regard, the","page_number":156,"box":{"x":70,"y":687,"width":785,"height":11}},{"id":"a07a7d77-f438-4da6-a12b-2d81ff99793e","block_type":"box","text":"por tfolio management investment and/or trading teams may consider a variety of factors, including the degree to","page_number":156,"box":{"x":70,"y":702,"width":806,"height":12}},{"id":"39f0e1b1-87c6-4846-9018-780092f65a41","block_type":"box","text":"which the broker-dealer: (a) provides access to company management; (b) provides access to their analysts;","page_number":156,"box":{"x":68,"y":718,"width":772,"height":11}},{"id":"b55d869d-8da2-48f5-abed-703f274ade82","block_type":"box","text":"(c) provides meaningful/insightful research notes on companies or other potential investments; (d) facilitates calls on","page_number":156,"box":{"x":69,"y":732,"width":838,"height":12}},{"id":"b713cf6a-0f48-4490-8775-d5e0b1ef0920","block_type":"box","text":"which meaningful or insightful ideas about companies or potential investments are discussed; (e) facilitates","page_number":156,"box":{"x":68,"y":748,"width":769,"height":11}},{"id":"0b3406b6-5eb4-4a53-8ae2-79bca732440f","block_type":"box","text":"conferences at which meaningful or insightful ideas about companies or potential investments are discussed; or","page_number":156,"box":{"x":69,"y":763,"width":801,"height":11}},{"id":"4d6688bb-7a54-4c6c-ab41-744f24e7def5","block_type":"box","text":"(f) provides research tools such as market data, financial analysis, and other third-par ty related research and","page_number":156,"box":{"x":69,"y":778,"width":778,"height":11}},{"id":"c622c9ca-986f-4af1-be89-4ab22250a857","block_type":"box","text":"brokerage tools that aid in the investment process.","page_number":156,"box":{"x":69,"y":793,"width":363,"height":11}},{"id":"156ff555-0910-4b61-9e62-4d31ae549a91","block_type":"box","text":"Research-oriented services for which BlackRock, unless prohibited by applicable law, might pay with Fund","page_number":156,"box":{"x":102,"y":816,"width":749,"height":11}},{"id":"96283ed5-3c65-453e-831a-583bf5bedea0","block_type":"box","text":"commissions may be in written form or through direct contact with individuals and may include information as to","page_number":156,"box":{"x":69,"y":831,"width":799,"height":11}},{"id":"ee8cea0a-2fe0-4857-9d07-be10c71b4799","block_type":"box","text":"par ticular companies or industries and securities or groups of securities, as well as market, economic, or","page_number":156,"box":{"x":70,"y":846,"width":752,"height":11}},{"id":"5ce572e2-722f-47a3-b372-2278dc90507c","block_type":"box","text":"institutional advice and statistical information, political developments and technical market information that assists","page_number":156,"box":{"x":70,"y":861,"width":823,"height":11}},{"id":"4c96c05e-1b9d-41ed-aef1-39ecc66dfed1","block_type":"box","text":"in the valuation of investments. Except as noted immediately below, research services furnished by brokers may be","page_number":156,"box":{"x":70,"y":876,"width":822,"height":11}},{"id":"761c28df-3218-468c-9566-b490b33d711a","block_type":"box","text":"used in servicing some or all client accounts and not all services may be used in connection with the Fund or account","page_number":156,"box":{"x":69,"y":891,"width":840,"height":12}},{"id":"a4c09f06-ad27-4b3b-8457-38acba655ee8","block_type":"box","text":"that paid commissions to the broker providing such services. In some cases, research information received from","page_number":156,"box":{"x":68,"y":906,"width":805,"height":12}},{"id":"18ca977a-fd98-42c2-9cbb-b184a5980c63","block_type":"box","text":"II-125","page_number":156,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"25f9d417-3222-4a26-b168-35dbebe3bf4a","block_type":"box","text":"NM1026U-5982568-156/232","page_number":156,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"76f34e85-c77d-43fd-8f37-b67bf171ead1","block_type":"box","text":"brokers by mutual fund management personnel, or personnel principally responsible for BlackRock’s individually","page_number":157,"box":{"x":69,"y":45,"width":798,"height":11}},{"id":"1e670443-55e1-44ee-aa37-fa457503c73f","block_type":"box","text":"managed por tfolios, is not necessarily shared by and between such personnel. Any investment advisory or other fees","page_number":157,"box":{"x":69,"y":60,"width":836,"height":11}},{"id":"fec58747-7e11-4674-b144-499be2c0c14f","block_type":"box","text":"paid by a Fund to BlackRock are not reduced as a result of BlackRock’s receipt of research services. In some cases,","page_number":157,"box":{"x":70,"y":75,"width":832,"height":11}},{"id":"312c5cb6-ecef-4e33-a99e-a6e810d49d45","block_type":"box","text":"BlackRock may receive a service from a broker that has both a “research” and a “non-research” use. When this","page_number":157,"box":{"x":70,"y":90,"width":798,"height":11}},{"id":"5f314a60-d299-4899-b1ff-16233f4fbbc0","block_type":"box","text":"occurs BlackRock makes a good faith allocation, under all the circumstances, between the research and non","page_number":157,"box":{"x":69,"y":105,"width":780,"height":11}},{"id":"8b966bae-6186-4fd3-9f90-8862da28bc85","block_type":"box","text":"research uses of the service. The percentage of the service that is used for research purposes may be paid for with","page_number":157,"box":{"x":69,"y":120,"width":827,"height":12}},{"id":"daaeb276-cfca-4381-97d3-b0d8ab5d5b07","block_type":"box","text":"client commissions, while BlackRock will use its own funds to pay for the percentage of the service that is used for","page_number":157,"box":{"x":69,"y":135,"width":821,"height":12}},{"id":"d55867fc-003c-4cb0-bbc8-732014d6d9f2","block_type":"box","text":"non-research purposes. In making this good faith allocation, BlackRock faces a potential conflict of interest, but","page_number":157,"box":{"x":69,"y":150,"width":797,"height":12}},{"id":"94488250-8362-4a0c-83ec-c203801fa688","block_type":"box","text":"BlackRock believes that its allocation procedures are reasonably designed to ensure that it appropriately allocates","page_number":157,"box":{"x":70,"y":166,"width":815,"height":11}},{"id":"5eeeb5f0-ad8c-4e8f-99a3-292352cdd3f1","block_type":"box","text":"the anticipated use of such services to their research and non-research uses.","page_number":157,"box":{"x":68,"y":181,"width":555,"height":11}},{"id":"d3dde917-50cb-4ffc-bbcc-1ebea10a828b","block_type":"box","text":"Under MiFID II, investment managers in the EU, including BIL, are not able to use soft dollars to pay for research","page_number":157,"box":{"x":102,"y":203,"width":802,"height":12}},{"id":"51117f9c-0da6-4655-8e16-a1cb5426691d","block_type":"box","text":"from brokers. Investment managers in the EU are required to either pay for research out of their own profit and loss","page_number":157,"box":{"x":68,"y":218,"width":825,"height":12}},{"id":"6a1bc36b-b06f-4256-9ecf-c81c3c4dfe6e","block_type":"box","text":"or agree with clients to have research costs paid by clients through research payment accounts that are directly","page_number":157,"box":{"x":69,"y":234,"width":798,"height":11}},{"id":"4567018f-5aa5-49fb-870c-8471936be2e3","block_type":"box","text":"funded or funded by a specific client research charge collected alongside execution commissions, provided that the","page_number":157,"box":{"x":68,"y":249,"width":824,"height":11}},{"id":"342234ee-4160-4ea1-a58f-9c2580f8a40c","block_type":"box","text":"payments for research are unbundled from the payments for execution. BIL will pay for any research out of its own","page_number":157,"box":{"x":70,"y":264,"width":812,"height":11}},{"id":"b4a9d55e-1cb1-4d75-88e8-8e237f7e9f18","block_type":"box","text":"resources and not through soft dollars or commission sharing arrangements.","page_number":157,"box":{"x":69,"y":279,"width":547,"height":11}},{"id":"6c34f18d-ee5a-4031-a153-22d8725c0a35","block_type":"box","text":"Payments of commissions to brokers who are affiliated persons of the Fund, or the Master Por tfolio with respect","page_number":157,"box":{"x":102,"y":302,"width":804,"height":11}},{"id":"9266dc28-a0ee-4304-9e0a-4cc855edf53a","block_type":"box","text":"to the Feeder Fund (or affiliated persons of such persons), will be made in accordance with Rule 17e-1 under the","page_number":157,"box":{"x":68,"y":317,"width":806,"height":11}},{"id":"1d84b95a-4a6e-425b-b642-349c887f1855","block_type":"box","text":"Investment Company Act. Subject to policies established by the Board of Directors of the Master Por tfolio, BlackRock","page_number":157,"box":{"x":70,"y":332,"width":836,"height":11}},{"id":"5be52ef1-cae3-4e07-8f11-f9c0c1139ac0","block_type":"box","text":"is primarily responsible for the execution of the Master Por tfolio’s por tfolio transactions and the allocation of","page_number":157,"box":{"x":70,"y":347,"width":777,"height":11}},{"id":"c3abbfbb-b1ba-41fe-a1bc-72ce3fd7fff5","block_type":"box","text":"brokerage.","page_number":157,"box":{"x":69,"y":362,"width":74,"height":11}},{"id":"5fd5afa4-c566-4ef6-a8c8-70fa8d8ba909","block_type":"box","text":"From time to time, a Fund may purchase new issues of securities in a fixed price offering. In these situations,","page_number":157,"box":{"x":102,"y":385,"width":781,"height":11}},{"id":"d91f9160-81af-4304-ab4a-343c4163ab76","block_type":"box","text":"the broker may be a member of the selling group that will, in addition to selling securities, provide BlackRock with","page_number":157,"box":{"x":68,"y":400,"width":810,"height":11}},{"id":"5c366d90-ae4a-46ce-8d00-5c18ea55f830","block_type":"box","text":"research services. FINRA has adopted rules expressly permitting these types of arrangements under cer tain","page_number":157,"box":{"x":69,"y":415,"width":771,"height":11}},{"id":"13913ce6-ac19-472d-af95-c9a76d1d37d5","block_type":"box","text":"circumstances. Generally, the broker will provide research “credits” in these situations at a rate that is higher than","page_number":157,"box":{"x":69,"y":430,"width":818,"height":11}},{"id":"4b580fb8-029a-4269-a095-90e4ce324ff2","block_type":"box","text":"that available for typical secondary market transactions. These arrangements may not fall within the safe harbor of","page_number":157,"box":{"x":68,"y":445,"width":821,"height":12}},{"id":"47f6d767-63c3-46e7-a878-9ed8b5ebad69","block_type":"box","text":"Section 28(e).","page_number":157,"box":{"x":69,"y":460,"width":99,"height":11}},{"id":"5025c32c-5229-426b-8479-f5bba4cb39cd","block_type":"box","text":"BlackRock does not consider sales of shares of the mutual funds it advises as a factor in the selection of","page_number":157,"box":{"x":102,"y":483,"width":755,"height":9}},{"id":"3efa1c33-0d44-4185-ae56-3f86a6972374","block_type":"box","text":"brokers or dealers to execute por tfolio transactions for a Fund; however, whether or not a par ticular broker or dealer","page_number":157,"box":{"x":69,"y":498,"width":828,"height":11}},{"id":"88835f15-0ac3-46c2-aa9f-77fc60e92d62","block_type":"box","text":"sells shares of the mutual funds advised by BlackRock neither qualifies nor disqualifies such broker or dealer to","page_number":157,"box":{"x":69,"y":513,"width":799,"height":11}},{"id":"e980ca5d-fc89-43d3-bcc2-63229efeb837","block_type":"box","text":"execute transactions for those mutual funds.","page_number":157,"box":{"x":69,"y":528,"width":319,"height":9}},{"id":"d39c608e-5b30-42eb-8cc0-f86c1b620207","block_type":"box","text":"Each Fund anticipates that its brokerage transactions involving foreign securities generally will be conducted","page_number":157,"box":{"x":102,"y":551,"width":770,"height":11}},{"id":"6692be8f-7daa-460a-acd8-30fe316d6228","block_type":"box","text":"primarily on the principal stock exchanges of the applicable country. Foreign equity securities may be held by a Fund","page_number":157,"box":{"x":70,"y":566,"width":825,"height":11}},{"id":"23ac7a13-98a5-4310-8fb6-d9d51374ad14","block_type":"box","text":"in the form of depositary receipts, or other securities conver tible into foreign equity securities. Depositary receipts","page_number":157,"box":{"x":70,"y":581,"width":816,"height":12}},{"id":"5f65f4c9-9be4-46d0-a457-dbc00cecf74f","block_type":"box","text":"may be listed on stock exchanges, or traded in OTC markets in the United States or Europe, as the case may be.","page_number":157,"box":{"x":69,"y":597,"width":805,"height":11}},{"id":"8bee2b92-432d-4c97-b149-2b6466bfa272","block_type":"box","text":"American Depositary Receipts, like other securities traded in the United States, will be subject to negotiated","page_number":157,"box":{"x":68,"y":612,"width":773,"height":11}},{"id":"8efa9d92-3cfe-42a8-b8fc-49612c648fe8","block_type":"box","text":"commission rates. Because the shares of each Fund are redeemable on a daily basis in U.S. dollars, each Fund","page_number":157,"box":{"x":69,"y":627,"width":798,"height":11}},{"id":"038e1c70-c53b-4408-a939-d3ca29b541a6","block_type":"box","text":"intends to manage its por tfolio so as to give reasonable assurance that it will be able to obtain U.S. dollars to the","page_number":157,"box":{"x":70,"y":642,"width":812,"height":11}},{"id":"11ce0203-4292-4555-8756-672813f1b5e2","block_type":"box","text":"extent necessary to meet anticipated redemptions. Under present conditions, it is not believed that these","page_number":157,"box":{"x":69,"y":657,"width":754,"height":11}},{"id":"a6d55aff-2287-4b04-8e4d-763a1e78fb0c","block_type":"box","text":"considerations will have a significant effect on a Fund’s por tfolio strategies.","page_number":157,"box":{"x":69,"y":672,"width":540,"height":11}},{"id":"b64a62c7-b86e-41da-8c6b-6fd18074deaa","block_type":"box","text":"See “Por tfolio Transactions and Brokerage” in the SAI for information about the brokerage commissions paid by","page_number":157,"box":{"x":102,"y":695,"width":798,"height":11}},{"id":"cb9f1ba3-c375-4e01-bfde-d59fba8da7c4","block_type":"box","text":"your Fund, including commissions paid to affiliates, if any, for the periods indicated.","page_number":157,"box":{"x":68,"y":710,"width":597,"height":11}},{"id":"02bd7b2d-516c-4be6-abe6-1030e734ac44","block_type":"box","text":"Each Fund may invest in cer tain securities traded in the OTC market and intends to deal directly with the dealers","page_number":157,"box":{"x":102,"y":733,"width":802,"height":11}},{"id":"5828367d-ad63-4316-bfd8-b48a7889b3a2","block_type":"box","text":"who make a market in the par ticular securities, except in those circumstances in which better prices and execution","page_number":157,"box":{"x":68,"y":748,"width":822,"height":11}},{"id":"25f0f740-cb59-4b2b-a041-b90c221a200a","block_type":"box","text":"are available elsewhere. Under the Investment Company Act, persons affiliated with a Fund and persons who are","page_number":157,"box":{"x":69,"y":763,"width":804,"height":11}},{"id":"26fac0bb-4009-4416-95cc-6ce4fff54b9a","block_type":"box","text":"affiliated with such affiliated persons are prohibited from dealing with the Fund as principal in the purchase and sale","page_number":157,"box":{"x":69,"y":778,"width":832,"height":11}},{"id":"55a71108-038f-4b0d-9e8c-87097bf06d07","block_type":"box","text":"of securities unless a permissive order allowing such transactions is obtained from the Commission. Since","page_number":157,"box":{"x":69,"y":793,"width":762,"height":11}},{"id":"def62c09-a15c-4e2f-a816-b722f561f47a","block_type":"box","text":"transactions in the OTC market usually involve transactions with the dealers acting as principal for their own","page_number":157,"box":{"x":68,"y":808,"width":770,"height":11}},{"id":"8bd125d0-efb8-4cd6-b7e9-f80c8b6eb0ae","block_type":"box","text":"accounts, the Funds will not deal with affiliated persons in connection with such transactions. However, an affiliated","page_number":157,"box":{"x":69,"y":823,"width":828,"height":11}},{"id":"63a9863d-57d8-49c4-beec-02abfd143e16","block_type":"box","text":"person of a Fund may serve as its broker in OTC transactions conducted on an agency basis provided that, among","page_number":157,"box":{"x":70,"y":838,"width":814,"height":12}},{"id":"24cd3950-210e-4d9c-98ab-090eb424e4a2","block_type":"box","text":"other things, the fee or commission received by such affiliated broker is reasonable and fair compared to the fee or","page_number":157,"box":{"x":69,"y":853,"width":825,"height":12}},{"id":"7e043a47-5f62-45a2-a91d-f1d9062dc1b2","block_type":"box","text":"commission received by non-affiliated brokers in connection with comparable transactions.","page_number":157,"box":{"x":69,"y":869,"width":645,"height":11}},{"id":"7eef6505-32c1-45bc-b752-b3ff005bb4c9","block_type":"box","text":"OTC issues, including most fixed-income securities such as corporate debt and U.S. Government Securities, are","page_number":157,"box":{"x":102,"y":891,"width":797,"height":12}},{"id":"53576165-0e2a-4f58-971f-b64af4cc068b","block_type":"box","text":"normally traded on a “net” basis without a stated commission, through dealers acting for their own account and not","page_number":157,"box":{"x":69,"y":906,"width":826,"height":12}},{"id":"454839be-1697-4bb4-b608-9cbb8c6ca25c","block_type":"box","text":"II-126","page_number":157,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"b6818264-7b7a-4d2f-b9a8-06c220cf132e","block_type":"box","text":"NM1026U-5982568-157/232","page_number":157,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"5b2b4a16-b5cb-4e74-a882-baa4abb348a6","block_type":"box","text":"as brokers. The Funds will primarily engage in transactions with these dealers or deal directly with the issuer unless a","page_number":158,"box":{"x":69,"y":45,"width":839,"height":11}},{"id":"f93d8d72-ac91-41d3-956e-5fe4b402690a","block_type":"box","text":"better price or execution could be obtained by using a broker. Prices paid to a dealer with respect to both foreign and","page_number":158,"box":{"x":69,"y":60,"width":833,"height":11}},{"id":"b07187fa-0e58-4f18-8e3a-ea937db0db26","block_type":"box","text":"domestic securities will generally include a “spread,” which is the difference between the prices at which the dealer","page_number":158,"box":{"x":69,"y":75,"width":826,"height":11}},{"id":"cdc2368f-075d-4d86-8b52-1aa9edfbb8a8","block_type":"box","text":"is willing to purchase and sell the specific security at the time, and includes the dealer’s normal profit.","page_number":158,"box":{"x":70,"y":90,"width":730,"height":11}},{"id":"3eba4f98-74ff-4076-9fd4-0fad65567182","block_type":"box","text":"Purchases of money market instruments by a Fund are made from dealers, underwriters and issuers. The Funds","page_number":158,"box":{"x":102,"y":113,"width":800,"height":11}},{"id":"2bbc1e64-018a-428f-acfd-2b5aa84e74d0","block_type":"box","text":"do not currently expect to incur any brokerage commission expense on such transactions because money market","page_number":158,"box":{"x":69,"y":128,"width":807,"height":11}},{"id":"f53364e2-126b-40d6-aece-a9ab48935ff0","block_type":"box","text":"instruments are generally traded on a “net” basis with dealers acting as principal for their own accounts without a","page_number":158,"box":{"x":70,"y":143,"width":812,"height":11}},{"id":"dea9e68f-68e3-4abf-84a7-061142628337","block_type":"box","text":"stated commission. The price of the security, however, usually includes a profit to the dealer. Each money market","page_number":158,"box":{"x":69,"y":158,"width":807,"height":11}},{"id":"394ac71f-bcba-4a7e-bedf-25204c2f76c2","block_type":"box","text":"fund intends to purchase only securities with remaining maturities of 397 days or less as determined in accordance","page_number":158,"box":{"x":68,"y":173,"width":827,"height":11}},{"id":"43703b91-3e54-4f2d-ba51-9d489408cb62","block_type":"box","text":"with the rules of the Commission. As a result, the por tfolio turnover rates of a money market fund will be relatively","page_number":158,"box":{"x":68,"y":188,"width":817,"height":11}},{"id":"e9c31021-233e-41e9-a527-11a855d2e654","block_type":"box","text":"high. However, because brokerage commissions will not normally be paid with respect to investments made by a","page_number":158,"box":{"x":69,"y":204,"width":802,"height":11}},{"id":"c32d9a9b-de9b-4790-b46d-c34e6289414b","block_type":"box","text":"money market fund, the turnover rates should not adversely affect the Fund’s NAVs or net income.","page_number":158,"box":{"x":69,"y":218,"width":700,"height":12}},{"id":"d6649c3a-df18-4896-8e8e-aaae6f9388ec","block_type":"box","text":"Securities purchased in underwritten offerings include a fixed amount of compensation to the underwriter,","page_number":158,"box":{"x":102,"y":241,"width":756,"height":11}},{"id":"c199617f-11cb-4f5d-ad80-4b1226ab6bff","block_type":"box","text":"generally referred to as the underwriter’s concession or discount. When offered securities are purchased or sold","page_number":158,"box":{"x":68,"y":256,"width":804,"height":12}},{"id":"5d2a8b9b-4034-4ec6-ab71-fc144a6792ca","block_type":"box","text":"directly from or to an issuer, no commissions or discounts are paid except where required by local markets.","page_number":158,"box":{"x":69,"y":271,"width":766,"height":12}},{"id":"85613636-e7e8-45e0-818c-4a7a0c1fff61","block_type":"box","text":"The Manager or sub-advisers may seek to obtain an under taking from issuers of commercial paper or dealers","page_number":158,"box":{"x":101,"y":294,"width":780,"height":11}},{"id":"4b4db870-e069-4ae9-9a3d-6712cbf302cf","block_type":"box","text":"selling commercial paper to consider the repurchase of such securities from a Fund prior to maturity at their original","page_number":158,"box":{"x":69,"y":309,"width":826,"height":11}},{"id":"2f71e95d-2553-44ef-9641-8fff1bfe2e4c","block_type":"box","text":"cost plus interest (sometimes adjusted to reflect the actual maturity of the securities), if it believes that a Fund’s","page_number":158,"box":{"x":69,"y":324,"width":806,"height":11}},{"id":"e827f5da-ff62-4f3c-9c48-ee614ee8813f","block_type":"box","text":"anticipated need for liquidity makes such action desirable. Any such repurchase prior to maturity reduces the","page_number":158,"box":{"x":69,"y":339,"width":776,"height":12}},{"id":"8effbfc0-9437-4631-a4ae-ac0208674b51","block_type":"box","text":"possibility that a Fund would incur a capital loss in liquidating commercial paper, especially if interest rates have","page_number":158,"box":{"x":70,"y":355,"width":800,"height":11}},{"id":"dce5aa44-2654-4a90-8d19-6a7dffa20872","block_type":"box","text":"risen since acquisition of such commercial paper.","page_number":158,"box":{"x":69,"y":370,"width":352,"height":11}},{"id":"55a2de8c-bd12-4795-8ad9-471f24bcfc37","block_type":"box","text":"Investment decisions for each Fund and for other investment accounts managed by the Manager or sub-advisers","page_number":158,"box":{"x":102,"y":392,"width":800,"height":12}},{"id":"dac305d2-53eb-4543-8f28-4a4254855522","block_type":"box","text":"are made independently of each other in light of differing conditions. BlackRock allocates investments among client","page_number":158,"box":{"x":69,"y":407,"width":824,"height":12}},{"id":"f76b8d5e-edab-4d0a-a235-70d03af8b5fe","block_type":"box","text":"accounts in a fair and equitable manner over time. A variety of factors will be considered in making such allocations.","page_number":158,"box":{"x":69,"y":423,"width":828,"height":11}},{"id":"cab3f303-3369-4c56-b5c0-0d3c64429ef1","block_type":"box","text":"These factors include: (i) investment objectives or strategies for par ticular accounts, including sector, industry,","page_number":158,"box":{"x":68,"y":438,"width":788,"height":11}},{"id":"6050df0a-f7e9-46ac-8141-253cd87f69a8","block_type":"box","text":"country or region and capitalization weightings, (ii) tax considerations of an account, (iii) risk or investment","page_number":158,"box":{"x":69,"y":453,"width":759,"height":11}},{"id":"eab697db-f2a0-4c8c-bb00-11fa1b83ba8c","block_type":"box","text":"concentration parameters for an account, (iv) supply or demand for a security at a given price level, (v) size of","page_number":158,"box":{"x":69,"y":468,"width":780,"height":11}},{"id":"d36a30d3-9104-409e-bcd6-cee1ae9037ee","block_type":"box","text":"available investment, (vi) cash availability and liquidity requirements for accounts, (vii) regulatory restrictions,","page_number":158,"box":{"x":69,"y":483,"width":777,"height":11}},{"id":"5f734437-c30c-4af8-a588-5405375fbc04","block_type":"box","text":"(viii) minimum investment size of an account, (ix) relative size of account, and (x) such other factors as may be","page_number":158,"box":{"x":69,"y":498,"width":788,"height":11}},{"id":"f00f5d14-0f56-4989-a16b-83c46378a938","block_type":"box","text":"approved by BlackRock’s general counsel. Moreover, investments may not be allocated to one client account over","page_number":158,"box":{"x":69,"y":514,"width":811,"height":11}},{"id":"12d3586c-0056-4088-877c-5d96de4bde65","block_type":"box","text":"another based on any of the following considerations: (i) to favor one client account at the expense of another, (ii) to","page_number":158,"box":{"x":69,"y":528,"width":829,"height":12}},{"id":"a95215be-274e-4284-9d80-8e3d1d31f812","block_type":"box","text":"generate higher fees paid by one client account over another or to produce greater per formance compensation to","page_number":158,"box":{"x":68,"y":543,"width":808,"height":12}},{"id":"9ba3b12d-aea6-4d3f-b50e-5286ae24c580","block_type":"box","text":"BlackRock, (iii) to develop or enhance a relationship with a client or prospective client, (iv) to compensate a client for","page_number":158,"box":{"x":70,"y":559,"width":832,"height":11}},{"id":"806ed5ea-efcc-4c95-a0e5-2dad7c40e06d","block_type":"box","text":"past services or benefits rendered to BlackRock or to induce future services or benefits to be rendered to BlackRock,","page_number":158,"box":{"x":70,"y":574,"width":836,"height":11}},{"id":"43c2e479-ba2b-40d7-9d79-bc20776b8a0e","block_type":"box","text":"or (v) to manage or equalize investment per formance among different client accounts.","page_number":158,"box":{"x":69,"y":589,"width":613,"height":11}},{"id":"caa97337-6a40-4e04-bf54-b766babf3f08","block_type":"box","text":"Equity securities will generally be allocated among client accounts within the same investment mandate on a pro","page_number":158,"box":{"x":102,"y":612,"width":802,"height":11}},{"id":"263e1d46-c484-4223-bdaf-4007bc38c25a","block_type":"box","text":"rata basis. All allocations of equity securities will be subject, where relevant, to share minimums established for","page_number":158,"box":{"x":69,"y":627,"width":800,"height":11}},{"id":"833a7de8-8701-4de8-8d1d-707c51378fab","block_type":"box","text":"accounts and compliance constraints.","page_number":158,"box":{"x":69,"y":642,"width":269,"height":11}},{"id":"0755df40-242c-40c5-91ae-e1c16aaed663","block_type":"box","text":"Initial public offerings of securities may be over-subscribed and subsequently trade at a premium in the","page_number":158,"box":{"x":102,"y":664,"width":736,"height":12}},{"id":"815276f4-10c8-4f38-816c-cc558e6ece8d","block_type":"box","text":"secondary market. In these situations, the supply of securities available for client accounts is often less than the","page_number":158,"box":{"x":69,"y":680,"width":808,"height":11}},{"id":"4a16ce58-740d-464a-8455-afc6673077b8","block_type":"box","text":"amount of securities the accounts would otherwise take. In order to allocate these investments fairly and equitably","page_number":158,"box":{"x":69,"y":695,"width":821,"height":11}},{"id":"52ab695e-5a83-4934-b06c-c27119f2248f","block_type":"box","text":"among client accounts over time, each por tfolio manager or a member of his or her respective investment team will","page_number":158,"box":{"x":69,"y":710,"width":823,"height":11}},{"id":"55ff27a3-3518-4b15-bad2-2b7c1f70bb6e","block_type":"box","text":"indicate to BlackRock’s trading desk their level of interest in a par ticular offering with respect to eligible client","page_number":158,"box":{"x":70,"y":725,"width":783,"height":11}},{"id":"1eca4f99-5957-444a-b700-b787e4b4de4a","block_type":"box","text":"accounts for which that team is responsible. Initial public offerings of U.S. equity securities will be identified as","page_number":158,"box":{"x":69,"y":740,"width":793,"height":11}},{"id":"8453f4b3-74ed-45f9-90ce-b7f92724f55b","block_type":"box","text":"eligible for par ticular client accounts that are managed by por tfolio teams who have indicated interest in the offering","page_number":158,"box":{"x":69,"y":755,"width":831,"height":11}},{"id":"5109cdd7-45e8-432c-b4d0-12523e10d4f8","block_type":"box","text":"based on market capitalization of the issuer of the security and the investment mandate of the client account and in","page_number":158,"box":{"x":69,"y":770,"width":828,"height":11}},{"id":"548f8c6a-44e2-4f2a-b5e1-8be7b5f86eaf","block_type":"box","text":"the case of international equity securities, the country where the offering is taking place and the investment mandate","page_number":158,"box":{"x":68,"y":785,"width":839,"height":12}},{"id":"2b736ca9-b23a-463b-a39f-4f571737c115","block_type":"box","text":"of the client account. Generally, shares received during the initial public offering will be allocated among par ticipating","page_number":158,"box":{"x":69,"y":801,"width":835,"height":11}},{"id":"a10669e2-e683-4ea2-baf9-e7fb4d7c9279","block_type":"box","text":"client accounts within each investment mandate on a pro rata basis. In situations where supply is too limited to be","page_number":158,"box":{"x":69,"y":816,"width":819,"height":11}},{"id":"0cf52831-a8ae-402e-afb0-d053b5e00e51","block_type":"box","text":"allocated among all accounts for which the investment is eligible, por tfolio managers may rotate such investment","page_number":158,"box":{"x":69,"y":831,"width":808,"height":11}},{"id":"2daaf74c-29ca-4f88-86d4-e10abace41cd","block_type":"box","text":"oppor tunities among one or more accounts so long as the rotation system provides for fair access for all client","page_number":158,"box":{"x":69,"y":846,"width":791,"height":11}},{"id":"2e94be31-ef76-4edd-a5e3-3756b71b0e17","block_type":"box","text":"accounts over time. Other allocation methodologies that are considered by BlackRock to be fair and equitable to","page_number":158,"box":{"x":69,"y":861,"width":799,"height":11}},{"id":"1933df91-b9d9-4d2b-a1c3-698eba8f654b","block_type":"box","text":"clients may be used as well.","page_number":158,"box":{"x":69,"y":876,"width":200,"height":11}},{"id":"1675f411-8727-429b-9a39-11411044ccae","block_type":"box","text":"II-127","page_number":158,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"dc8c4cc0-8506-4e6c-abb5-957a64674554","block_type":"box","text":"NM1026U-5982568-158/232","page_number":158,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"cd37e4bb-31b5-42d0-986c-b36ae3ec0431","block_type":"box","text":"Because different accounts may have differing investment objectives and policies, BlackRock may buy and sell","page_number":159,"box":{"x":102,"y":45,"width":789,"height":11}},{"id":"79c09e64-5bbf-4ec5-b400-0f9eec4beeee","block_type":"box","text":"the same securities at the same time for different clients based on the par ticular investment objective, guidelines","page_number":159,"box":{"x":68,"y":60,"width":815,"height":11}},{"id":"5b3cf8b3-4d20-4373-9bd3-260368c6d629","block_type":"box","text":"and strategies of those accounts. For example, BlackRock may decide that it may be entirely appropriate for a growth","page_number":159,"box":{"x":69,"y":75,"width":835,"height":11}},{"id":"cded8ac1-1b51-4fc8-9c18-a8ed36143c4c","block_type":"box","text":"fund to sell a security at the same time a value fund is buying that security. To the extent that transactions on behalf","page_number":159,"box":{"x":68,"y":90,"width":833,"height":11}},{"id":"4cf1c4a0-f14e-487d-880c-ca6cf717f32f","block_type":"box","text":"of more than one client of BlackRock or its affiliates during the same period may increase the demand for securities","page_number":159,"box":{"x":69,"y":105,"width":829,"height":11}},{"id":"51249aed-a3ba-45de-8481-df0d09588a29","block_type":"box","text":"being purchased or the supply of securities being sold, there may be an adverse effect on price. For example, sales","page_number":159,"box":{"x":69,"y":120,"width":825,"height":12}},{"id":"6b86b6b0-ca3f-4715-ae25-10e2289ba5f8","block_type":"box","text":"of a security by BlackRock on behalf of one or more of its clients may decrease the market price of such security,","page_number":159,"box":{"x":69,"y":135,"width":806,"height":11}},{"id":"5daa9aef-3baf-4073-826a-5770c001090a","block_type":"box","text":"adversely impacting other BlackRock clients that still hold the security. If purchases or sales of securities arise for","page_number":159,"box":{"x":69,"y":150,"width":814,"height":12}},{"id":"7579b8e0-24a1-40fb-b553-7614e213e4fb","block_type":"box","text":"consideration at or about the same time that would involve a Fund or other clients or funds for which BlackRock or an","page_number":159,"box":{"x":69,"y":166,"width":836,"height":9}},{"id":"41c59d28-2530-4dc3-856f-7df248d8c303","block_type":"box","text":"affiliate act as investment manager, transactions in such securities will be made, insofar as feasible, for the","page_number":159,"box":{"x":69,"y":181,"width":773,"height":11}},{"id":"b74d30cb-cad6-4f25-8e06-4911ce006c0c","block_type":"box","text":"respective funds and clients in a manner deemed equitable to all.","page_number":159,"box":{"x":69,"y":196,"width":467,"height":11}},{"id":"892d448a-e1bb-4d4c-be66-5c282ffad4b4","block_type":"box","text":"In cer tain instances, BlackRock may find it efficient for purposes of seeking to obtain best execution, to","page_number":159,"box":{"x":102,"y":218,"width":741,"height":12}},{"id":"c22c7288-4eba-439a-a376-fb09287a5bdc","block_type":"box","text":"aggregate cer tain contemporaneous purchases or sale orders of its advisory accounts. In general, all","page_number":159,"box":{"x":69,"y":234,"width":721,"height":11}},{"id":"09c2e96d-15cb-418d-8dcf-d77650f4024c","block_type":"box","text":"contemporaneous trades for client accounts under management by the same por tfolio manager or investment team","page_number":159,"box":{"x":69,"y":249,"width":824,"height":11}},{"id":"db01d336-11c5-416a-b2a1-41aa44deaa8b","block_type":"box","text":"will be aggregated in a single order if the trader believes the aggregated trade would provide each client with an","page_number":159,"box":{"x":68,"y":264,"width":795,"height":11}},{"id":"e1e25a9e-685e-4d09-9569-32c443eab220","block_type":"box","text":"oppor tunity to achieve a more favorable execution at a potentially lower execution cost. The costs associated with an","page_number":159,"box":{"x":69,"y":279,"width":834,"height":11}},{"id":"7d6b8427-68f1-4d6c-9bc0-2c7784b1c234","block_type":"box","text":"aggregated order will be shared pro rata among the clients in the aggregated order. Generally, if an order for a","page_number":159,"box":{"x":69,"y":294,"width":783,"height":11}},{"id":"019f2672-d69b-496d-866b-0ae9b76dc0cf","block_type":"box","text":"par ticular por tfolio manager or management team is filled at several different prices through multiple trades, all","page_number":159,"box":{"x":70,"y":309,"width":796,"height":11}},{"id":"921c2042-9610-4032-88f3-830a5e7bb7f5","block_type":"box","text":"accounts par ticipating in the order will receive the average price except in the case of cer tain international markets","page_number":159,"box":{"x":69,"y":324,"width":821,"height":12}},{"id":"e1c75e01-02b9-4ca1-9b97-5957ee8bc718","block_type":"box","text":"where average pricing is not permitted. While in some cases this practice could have a detrimental effect upon the","page_number":159,"box":{"x":68,"y":339,"width":819,"height":12}},{"id":"286a2ed0-beb0-4ce4-a4a9-75179d409c4f","block_type":"box","text":"price or value of the security as far as a Fund is concerned, in other cases it could be beneficial to the Fund.","page_number":159,"box":{"x":70,"y":355,"width":771,"height":11}},{"id":"a501d6ac-9c69-4d6b-a712-01bcac5dbb38","block_type":"box","text":"Transactions effected by BlackRock on behalf of more than one of its clients during the same period may increase","page_number":159,"box":{"x":68,"y":370,"width":815,"height":11}},{"id":"57686b7f-eb60-4ae4-bde6-d41c1ff69482","block_type":"box","text":"the demand for securities being purchased or the supply of securities being sold, causing an adverse effect on price.","page_number":159,"box":{"x":68,"y":385,"width":835,"height":11}},{"id":"05f8556f-41f4-46b1-a297-6113bae9766f","block_type":"box","text":"The trader will give the aggregated order to the broker-dealer that the trader has identified as being able to provide","page_number":159,"box":{"x":68,"y":400,"width":817,"height":11}},{"id":"8d195847-49c6-437f-93d4-846e1332b626","block_type":"box","text":"the best execution of the order. Orders for purchase or sale of securities will be placed within a reasonable amount","page_number":159,"box":{"x":68,"y":415,"width":823,"height":11}},{"id":"1314b751-ca8a-4a51-b787-6898bf3f973f","block_type":"box","text":"of time of the order receipt and aggregated orders will be kept aggregated only long enough to execute the order.","page_number":159,"box":{"x":69,"y":430,"width":803,"height":11}},{"id":"3fc5a20d-f509-4ae3-bbb5-928f71ecb5b6","block_type":"box","text":"A Fund will not purchase securities during the existence of any underwriting or selling group relating to such","page_number":159,"box":{"x":101,"y":453,"width":767,"height":11}},{"id":"227058df-d1e2-485e-b4f3-88426fb13f3b","block_type":"box","text":"securities of which BlackRock, BRIL or any affiliated person (as defined in the Investment Company Act) thereof is a","page_number":159,"box":{"x":69,"y":468,"width":826,"height":11}},{"id":"b988b319-91b1-43d9-9f05-d77fafd8a927","block_type":"box","text":"member except pursuant to procedures adopted by the Board of Directors in accordance with Rule 10f-3 under the","page_number":159,"box":{"x":69,"y":483,"width":816,"height":11}},{"id":"0b011598-62f8-4dab-bcb6-a3184122d0af","block_type":"box","text":"Investment Company Act. In no instance will por tfolio securities be purchased from or sold to BlackRock, BRIL or any","page_number":159,"box":{"x":70,"y":498,"width":833,"height":11}},{"id":"c95c4408-b2df-4f2c-a694-e1a48aeaecb2","block_type":"box","text":"affiliated person of the foregoing entities except as permitted by Commission exemptive order or by applicable law.","page_number":159,"box":{"x":69,"y":513,"width":818,"height":12}},{"id":"7ff26a9f-06cd-451b-84ad-866b7fc0c459","block_type":"box","text":"A Fund’s purchase and sale orders for securities may be combined with those of other investment companies,","page_number":159,"box":{"x":101,"y":536,"width":786,"height":11}},{"id":"08678ed8-24c4-4cd6-9e09-6df8666c8e57","block_type":"box","text":"clients or accounts that BlackRock manages or advises. If purchases or sales of por tfolio securities of a Fund and","page_number":159,"box":{"x":69,"y":551,"width":814,"height":11}},{"id":"90f0b80a-5f62-45c1-820b-9d06cec1a968","block_type":"box","text":"one or more other accounts managed or advised by BlackRock are considered at or about the same time,","page_number":159,"box":{"x":69,"y":566,"width":751,"height":11}},{"id":"d18b4054-5257-4e9f-98f3-38fdcafb70cb","block_type":"box","text":"transactions in such securities are allocated among the Fund and the other accounts in a manner deemed equitable","page_number":159,"box":{"x":68,"y":582,"width":829,"height":11}},{"id":"7053d5b9-8435-4b72-8cd8-ff7881c19bc2","block_type":"box","text":"to all by BlackRock. In some cases, this procedure could have a detrimental effect on the price or volume of the","page_number":159,"box":{"x":68,"y":596,"width":799,"height":12}},{"id":"7385f37c-c2a9-420f-b718-b30ec6c8b934","block_type":"box","text":"security as far as a Fund is concerned. However, in other cases, it is possible that the ability to par ticipate in volume","page_number":159,"box":{"x":69,"y":612,"width":834,"height":11}},{"id":"8ad69840-36a0-41f9-a4b6-14a3e7fe24de","block_type":"box","text":"transactions and to negotiate lower transaction costs will be beneficial to the Fund. BlackRock may deal, trade and","page_number":159,"box":{"x":68,"y":627,"width":820,"height":11}},{"id":"e38f3765-5523-446c-b342-b6741e930885","block_type":"box","text":"invest for its own account in the types of securities in which a Fund may invest. BlackRock may, from time to time,","page_number":159,"box":{"x":70,"y":642,"width":812,"height":11}},{"id":"9905866a-4309-48ae-944e-ce75bb26fe30","block_type":"box","text":"effect trades on behalf of and for the account of a Fund with brokers or dealers that are affiliated with BFA, in","page_number":159,"box":{"x":69,"y":657,"width":781,"height":10}},{"id":"e0825262-d4bb-4105-8072-4d027d78b2ea","block_type":"box","text":"conformity with the Investment Company Act and Commission rules and regulations. Under these provisions, any","page_number":159,"box":{"x":69,"y":672,"width":805,"height":11}},{"id":"fabbbc80-2059-460d-a603-fca8525681cc","block_type":"box","text":"commissions paid to affiliated brokers or dealers must be reasonable and fair compared to the commissions charged","page_number":159,"box":{"x":69,"y":687,"width":840,"height":11}},{"id":"a7ef39ba-41ad-412e-b23e-098114cdf538","block_type":"box","text":"by other brokers or dealers in comparable transactions. A Fund will not deal with affiliates in principal transactions","page_number":159,"box":{"x":69,"y":702,"width":815,"height":11}},{"id":"cd520abd-9a73-48b5-b01f-38fcd90182e9","block_type":"box","text":"unless permitted by applicable Commission rules or regulations, or by Commission exemptive order.","page_number":159,"box":{"x":69,"y":718,"width":713,"height":11}},{"id":"c495d075-05d5-4386-a770-24efdc3e82b7","block_type":"box","text":"Portfolio Turnover","page_number":159,"box":{"x":69,"y":748,"width":129,"height":9}},{"id":"c441e9d3-8725-4bd7-8dad-33f35103966d","block_type":"box","text":"The por tfolio turnover rate is calculated by dividing the lesser of a Fund’s annual sales or purchases of por tfolio","page_number":159,"box":{"x":101,"y":770,"width":798,"height":12}},{"id":"a3310dc0-7eff-45ae-be86-4bd50fd675cd","block_type":"box","text":"securities (exclusive of purchases or sales of U.S. Government Securities and all other securities whose maturities at","page_number":159,"box":{"x":69,"y":785,"width":839,"height":11}},{"id":"1282841e-64b0-49ce-9223-126d2dd531b7","block_type":"box","text":"the time of acquisition were one year or less) by the monthly average value of the securities in the por tfolio during","page_number":159,"box":{"x":68,"y":801,"width":814,"height":11}},{"id":"e4c0bd63-a99e-4cdf-bec1-1df218cf071f","block_type":"box","text":"the year. A high rate of por tfolio turnover results in cer tain tax consequences, such as increased capital gain","page_number":159,"box":{"x":68,"y":816,"width":777,"height":11}},{"id":"27ad3d5a-4df9-4b59-a7a7-e93f61ff48bc","block_type":"box","text":"dividends and/or ordinary income dividends, and in correspondingly greater transaction costs in the form of dealer","page_number":159,"box":{"x":69,"y":831,"width":818,"height":11}},{"id":"444466e1-14d3-4e85-8463-a4ca12bb302d","block_type":"box","text":"spreads and brokerage commissions, which are borne directly by a Fund.","page_number":159,"box":{"x":69,"y":846,"width":519,"height":11}},{"id":"c6892d89-cb84-499e-ba87-aa0ad6a24fe4","block_type":"box","text":"II-128","page_number":159,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"c7f5ca9c-843c-48a9-9b0c-5bc6c46580b5","block_type":"box","text":"NM1026U-5982568-159/232","page_number":159,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"52e71a2a-4ba5-466d-b978-e7c657f0dc3b","block_type":"box","text":"DIVIDENDS AND TAXES","page_number":160,"box":{"x":396,"y":45,"width":186,"height":10}},{"id":"f04de9e5-2732-4a09-9b5e-16ee5415a9e7","block_type":"box","text":"Dividends","page_number":160,"box":{"x":69,"y":76,"width":69,"height":8}},{"id":"855e38f8-cfea-4553-87f4-5939bbfbc5d1","block_type":"box","text":"Each Fund intends to distribute substantially all of its net investment income, if any. Dividends from such net","page_number":160,"box":{"x":102,"y":98,"width":776,"height":11}},{"id":"9679c4a6-5bc1-4440-afaf-de7f1c61341f","block_type":"box","text":"investment income are paid as set for th in each Fund’s Prospectus. Each Fund also intends to distribute all net","page_number":160,"box":{"x":70,"y":113,"width":795,"height":11}},{"id":"180665de-9d98-4d34-888f-495aa46225c1","block_type":"box","text":"realized capital gains, if any, as set for th in such Fund’s Prospectus. From time to time, a Fund may declare a special","page_number":160,"box":{"x":69,"y":128,"width":837,"height":12}},{"id":"102ea3e2-15d9-486d-8d0b-d61960a95f18","block_type":"box","text":"distribution at or about the end of the calendar year in order to comply with U.S. federal tax requirements that cer tain","page_number":160,"box":{"x":69,"y":143,"width":836,"height":12}},{"id":"eb99def4-ce56-4204-9d13-c3fffd1b0f40","block_type":"box","text":"percentages of its ordinary income and capital gains be distributed during the year. If, in any fiscal year, a Fund has","page_number":160,"box":{"x":70,"y":159,"width":822,"height":11}},{"id":"1eacb23f-a539-4f97-ad72-bec6479a08c1","block_type":"box","text":"net income from cer tain foreign currency transactions, such income will be distributed at least annually.","page_number":160,"box":{"x":69,"y":174,"width":739,"height":11}},{"id":"3ceca9fb-d47a-498b-b071-d8b7674fc9d4","block_type":"box","text":"For information concerning the manner in which dividends may be reinvested automatically in shares of each","page_number":160,"box":{"x":102,"y":196,"width":773,"height":12}},{"id":"edcf8efc-7465-423d-a00e-10ae206b4178","block_type":"box","text":"Fund, as applicable, see “Shareholder Services — Automatic Dividend Reinvestment Plan.” Shareholders may also","page_number":160,"box":{"x":70,"y":212,"width":819,"height":11}},{"id":"21f2468e-8395-46e5-aea7-77250a6019c6","block_type":"box","text":"elect in writing to receive any such dividends in cash. Dividends are taxable to shareholders, as discussed below,","page_number":160,"box":{"x":69,"y":227,"width":807,"height":11}},{"id":"289c9335-b6d4-4b78-9d21-68964cdd422b","block_type":"box","text":"whether they are reinvested in shares of the Fund or received in cash. The per share dividends on front-end load","page_number":160,"box":{"x":68,"y":242,"width":800,"height":11}},{"id":"47fc02fb-30ce-42b8-922a-c6431cca8dde","block_type":"box","text":"shares, CDSC shares and Service Shares will be lower than the per share dividends on Institutional Shares as a","page_number":160,"box":{"x":69,"y":257,"width":801,"height":11}},{"id":"1674888b-5dc1-4d05-8e6e-31f2f1511f1b","block_type":"box","text":"result of the service, distribution and higher transfer agency fees applicable to CDSC shares, the service fees","page_number":160,"box":{"x":69,"y":272,"width":783,"height":11}},{"id":"745add7f-b8b8-4904-a15c-497e7103bacc","block_type":"box","text":"applicable to front-end load shares and Service Shares, and the service and distribution fees applicable to Class R","page_number":160,"box":{"x":69,"y":287,"width":820,"height":11}},{"id":"5b84f43f-87a8-48dc-a558-9806fdaa6e02","block_type":"box","text":"Shares. Similarly, the per share dividends on CDSC shares and Class R Shares will be lower than the per share","page_number":160,"box":{"x":69,"y":302,"width":794,"height":11}},{"id":"33f23f01-647c-45d6-aff5-76a647940d30","block_type":"box","text":"dividends on front-end load shares and Service Shares as a result of the distribution fees and higher transfer agency","page_number":160,"box":{"x":69,"y":317,"width":834,"height":12}},{"id":"234b00fe-7b62-4496-9bbe-749257ba2c34","block_type":"box","text":"fees applicable to CDSC shares and the distribution fees applicable to Class R Shares, and the per share dividends","page_number":160,"box":{"x":68,"y":332,"width":826,"height":11}},{"id":"beacf718-9489-41ad-86cb-8d56055d120a","block_type":"box","text":"on CDSC shares will be lower than the per share dividends on Class R Shares as a result of the higher distribution","page_number":160,"box":{"x":69,"y":348,"width":816,"height":11}},{"id":"73bdf5d3-22e2-45c2-b1d6-d36480aa82df","block_type":"box","text":"fees and higher transfer agency fees applicable to CDSC shares.","page_number":160,"box":{"x":68,"y":363,"width":461,"height":11}},{"id":"635e7750-27ea-4a70-9b75-614d8799b1f2","block_type":"box","text":"Taxes","page_number":160,"box":{"x":68,"y":393,"width":42,"height":9}},{"id":"fd0cc0e3-2764-456a-ab0d-fad16200dc59","block_type":"box","text":"Each Fund intends to continue to qualify for the special tax treatment afforded to regulated investment","page_number":160,"box":{"x":102,"y":416,"width":732,"height":11}},{"id":"d95dc821-626c-4642-a7dd-2d05dc6426f1","block_type":"box","text":"companies under the Code. As long as a Fund so qualifies, the Fund (but not its shareholders) will not be subject to","page_number":160,"box":{"x":69,"y":431,"width":825,"height":11}},{"id":"3159e0a1-dd11-497a-85d6-ab12d6f602ec","block_type":"box","text":"U.S. federal income tax on the par t of its investment company taxable income and net realized capital gains that it","page_number":160,"box":{"x":70,"y":446,"width":817,"height":11}},{"id":"25e0c04a-000e-4bb5-9325-d0aad86991c4","block_type":"box","text":"distributes to its shareholders in years in which it distributes at least 90% of its investment company taxable income","page_number":160,"box":{"x":69,"y":461,"width":832,"height":11}},{"id":"0db9e581-7bcb-4d73-8e3e-9423924dc1a1","block_type":"box","text":"and at least 90% of its net tax-exempt interest income, if any, for the year. To qualify as a regulated investment","page_number":160,"box":{"x":69,"y":476,"width":791,"height":11}},{"id":"8fbd6556-723f-42ae-aacc-290a6edf1d32","block_type":"box","text":"company, a Fund must meet cer tain requirements regarding the source of its income and the composition and","page_number":160,"box":{"x":69,"y":491,"width":786,"height":12}},{"id":"0002a59f-2ba2-4421-81ac-cfa815d13cde","block_type":"box","text":"diversification of its assets. See Par t II, “Investment Risks and Considerations—Investment Restrictions (All Funds)”","page_number":160,"box":{"x":69,"y":506,"width":831,"height":11}},{"id":"c66109bb-0b40-43c1-8c82-e80ad0bfb1e6","block_type":"box","text":"for a discussion of the asset diversification requirements. In the case of a Feeder Fund, such Fund may look to the","page_number":160,"box":{"x":68,"y":521,"width":819,"height":12}},{"id":"b8a25d58-781d-40fc-be09-a2a893c6c2d2","block_type":"box","text":"underlying assets of the Master Por tfolio in which it has invested for purposes of satisfying the asset diversification","page_number":160,"box":{"x":69,"y":537,"width":824,"height":11}},{"id":"f14349c3-95eb-4d04-910b-74531b2cc636","block_type":"box","text":"requirement and various other requirements of the Code applicable to regulated investment companies.","page_number":160,"box":{"x":69,"y":552,"width":739,"height":11}},{"id":"cb1c55fc-7f46-4d38-9e91-6aaa42ea57ab","block_type":"box","text":"A Fund may be able to cure a failure to derive at least 90% of its income from the sources specified above or a","page_number":160,"box":{"x":101,"y":574,"width":792,"height":12}},{"id":"2f653683-ceca-4e95-942f-a864b18470a6","block_type":"box","text":"failure to diversify its holdings in the manner described above by paying a tax, by disposing of cer tain assets, or by","page_number":160,"box":{"x":68,"y":589,"width":819,"height":12}},{"id":"7f43a494-5cdd-484e-8c55-eee595a736e4","block_type":"box","text":"paying a tax and disposing of assets. If, in any taxable year, a Fund fails one of these tests and does not timely cure","page_number":160,"box":{"x":70,"y":605,"width":830,"height":11}},{"id":"cce17fc4-3e51-4458-835a-6266fd53e533","block_type":"box","text":"the failure, the Fund will be taxed in the same manner as an ordinary corporation and distributions to its","page_number":160,"box":{"x":68,"y":620,"width":744,"height":11}},{"id":"dfab9a83-867a-4652-a341-1d51e2790803","block_type":"box","text":"shareholders will not be deductible by the Fund in computing its taxable income. Although in general the passive loss","page_number":160,"box":{"x":69,"y":635,"width":835,"height":11}},{"id":"f2e33b3c-1a50-4d56-9256-9a709231033d","block_type":"box","text":"rules of the Code do not apply to regulated investment companies, such rules do apply to a regulated investment","page_number":160,"box":{"x":69,"y":650,"width":808,"height":11}},{"id":"50662506-2059-4696-bea0-c7fd81add33e","block_type":"box","text":"company with respect to items attributable to an interest in a qualified publicly-traded par tnership. A Fund’s","page_number":160,"box":{"x":69,"y":665,"width":767,"height":11}},{"id":"ba945ff6-f585-4be6-be15-c529a3ecb194","block_type":"box","text":"investments in par tnerships, including in qualified publicly-traded par tnerships, may result in the Fund being subject","page_number":160,"box":{"x":70,"y":680,"width":826,"height":12}},{"id":"fc5ed847-4f5c-499d-b7d9-3587c990df6a","block_type":"box","text":"to state, local, or non-U.S. income, franchise or withholding tax liabilities.","page_number":160,"box":{"x":68,"y":695,"width":521,"height":12}},{"id":"0a490cad-7605-48d5-80e6-8875504c857e","block_type":"box","text":"Each Fund intends to distribute substantially all of such income and gains. If, in any taxable year, a Fund fails to","page_number":160,"box":{"x":102,"y":718,"width":798,"height":11}},{"id":"d0c91c21-b9f7-4477-9a1a-c3377d868e09","block_type":"box","text":"qualify as a regulated investment company under the Code, notwithstanding the availability of cer tain relief","page_number":160,"box":{"x":69,"y":733,"width":762,"height":11}},{"id":"c941a748-8fc5-444a-a31a-03a0d5480595","block_type":"box","text":"provisions, such Fund would be taxed in the same manner as an ordinary corporation and all distributions from","page_number":160,"box":{"x":70,"y":748,"width":789,"height":11}},{"id":"a7ac4ebe-6f3e-445e-81e6-d39dbbbe3806","block_type":"box","text":"earnings and profits (as determined under U.S. federal income tax principles) to its shareholders would be taxable as","page_number":160,"box":{"x":69,"y":763,"width":837,"height":12}},{"id":"2b24d7c3-7d8a-40f8-9bac-65ac01141097","block_type":"box","text":"ordinary dividend income eligible for taxation at a reduced tax rate for non-corporate shareholders and the dividends","page_number":160,"box":{"x":69,"y":778,"width":831,"height":12}},{"id":"798d30d2-db36-4443-ac52-618c4017967a","block_type":"box","text":"received deduction for corporate shareholders. However, a Municipal Fund’s distributions derived from income on tax","page_number":160,"box":{"x":69,"y":794,"width":837,"height":11}},{"id":"1e28e9f7-5058-443d-8044-6b9d1c3edf89","block_type":"box","text":"exempt obligations, as defined herein, would no longer qualify for treatment as exempt interest. Each Fund that is a","page_number":160,"box":{"x":69,"y":809,"width":825,"height":11}},{"id":"4aceb611-37b9-4f6f-b244-62cb0fce7bc4","block_type":"box","text":"series of a regulated investment company that consists of multiple series is treated as a separate corporation for","page_number":160,"box":{"x":69,"y":824,"width":811,"height":11}},{"id":"4d0a984c-b839-4693-8866-d48efc06fbff","block_type":"box","text":"U.S. federal income tax purposes, and therefore is considered to be a separate entity in determining its treatment","page_number":160,"box":{"x":70,"y":839,"width":813,"height":11}},{"id":"71af39f9-4c23-435f-9c32-b89ed32566d7","block_type":"box","text":"under the rules for regulated investment companies. Losses in one series of a regulated investment company do not","page_number":160,"box":{"x":69,"y":854,"width":834,"height":11}},{"id":"adc53179-e79b-440a-8905-2bf44c9b5713","block_type":"box","text":"offset gains in another, and the requirements (other than cer tain organizational requirements) for qualifying for","page_number":160,"box":{"x":69,"y":869,"width":790,"height":11}},{"id":"1188c220-d0f3-46b6-902a-6fb1c0c02634","block_type":"box","text":"regulated investment company status will be determined at the level of the individual series. In the following","page_number":160,"box":{"x":69,"y":884,"width":771,"height":12}},{"id":"78664722-b19a-49d9-a704-67d8c635846e","block_type":"box","text":"discussion, the term “Fund” means each individual series, if applicable.","page_number":160,"box":{"x":69,"y":899,"width":512,"height":11}},{"id":"f70d2226-3ff7-4423-a99f-1144774f63d7","block_type":"box","text":"II-129","page_number":160,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"4be64cea-51f5-4b4a-a426-93be55d8f567","block_type":"box","text":"NM1026U-5982568-160/232","page_number":160,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"137e57a3-e62c-4cd0-91c8-120a1ff7b63f","block_type":"box","text":"The Code requires a regulated investment company to pay a nondeductible 4% excise tax to the extent the","page_number":161,"box":{"x":101,"y":45,"width":759,"height":11}},{"id":"5555fa22-3283-480a-a766-043d88cf43e7","block_type":"box","text":"regulated investment company does not distribute, during each calendar year, at least 98% of its ordinary income,","page_number":161,"box":{"x":69,"y":60,"width":813,"height":11}},{"id":"df39cae9-f177-424f-862c-65edd947b809","block_type":"box","text":"determined on a calendar year basis, and at least 98.2% of its capital gain net income, determined, in general, as if","page_number":161,"box":{"x":69,"y":75,"width":830,"height":11}},{"id":"d529b767-fbd2-4c84-b5f8-aaaffd1d6ec2","block_type":"box","text":"the regulated investment company’s taxable year ended on October 31, plus cer tain undistributed amounts from the","page_number":161,"box":{"x":68,"y":90,"width":832,"height":11}},{"id":"a96da1a5-e46f-4830-8f0b-90f729e12510","block_type":"box","text":"previous years. While each Fund intends to distribute its income and capital gains in the manner necessary to avoid","page_number":161,"box":{"x":70,"y":105,"width":825,"height":11}},{"id":"42b2c6b9-5eb0-4da5-a6ed-740f95d32062","block_type":"box","text":"imposition of the 4% excise tax, there can be no assurance that a sufficient amount of the Fund’s taxable income","page_number":161,"box":{"x":70,"y":120,"width":810,"height":11}},{"id":"304355ef-15e8-49fd-9e7a-c29dfd26e059","block_type":"box","text":"and capital gains will be distributed to avoid entirely the imposition of the tax. In such event, a Fund will be liable for","page_number":161,"box":{"x":69,"y":135,"width":828,"height":12}},{"id":"dfe3644c-1ef5-44ab-befd-9b32742d1ef2","block_type":"box","text":"the tax only on the amount by which it does not meet the foregoing distribution requirements.","page_number":161,"box":{"x":68,"y":150,"width":666,"height":12}},{"id":"05cf413b-6726-463b-a7d1-fca68637c29c","block_type":"box","text":"Net capital loss carryforwards may be applied against realized capital gains in each succeeding year, until they","page_number":161,"box":{"x":102,"y":173,"width":790,"height":11}},{"id":"cf6cfc31-132b-43a1-b485-b1f97f72a23d","block_type":"box","text":"have been reduced to zero. In the event that the Fund were to experience an ownership change as defined under the","page_number":161,"box":{"x":69,"y":188,"width":830,"height":12}},{"id":"7a02d4c4-18ae-4080-96ac-1297e8fc86e9","block_type":"box","text":"Code, the Fund’s loss carryforwards and other favorable tax attributes of the Fund, if any, may be subject to","page_number":161,"box":{"x":69,"y":203,"width":770,"height":12}},{"id":"1fbb3c05-5ed3-4d1e-9ff5-70861f674a66","block_type":"box","text":"limitation.","page_number":161,"box":{"x":70,"y":219,"width":68,"height":8}},{"id":"0916a3c2-36ed-44ae-adc2-f9f1920c1cee","block_type":"box","text":"Dividends paid by a Fund from its ordinary income or from an excess of net shor t-term capital gain over net long","page_number":161,"box":{"x":102,"y":241,"width":803,"height":11}},{"id":"1573f05a-96e6-4616-b5a0-3d41ae7dd24d","block_type":"box","text":"term capital loss (together referred to as “ordinary income dividends”) are taxable to shareholders as ordinary","page_number":161,"box":{"x":68,"y":256,"width":790,"height":12}},{"id":"dbc8df89-3eed-464d-b9ad-a15c2c90cdd6","block_type":"box","text":"income. Distributions made from an excess of net long-term capital gain over net shor t-term capital loss (including","page_number":161,"box":{"x":70,"y":271,"width":815,"height":12}},{"id":"f93b713e-c38c-4d2a-b033-e28afe6ef131","block_type":"box","text":"gains or losses from cer tain transactions in futures and options) (“capital gain dividends”) are taxable to","page_number":161,"box":{"x":68,"y":286,"width":748,"height":12}},{"id":"58dc0546-48ef-4b6c-ae14-b2671afccd74","block_type":"box","text":"shareholders as long-term capital gains, regardless of the length of time the shareholder has owned Fund shares.","page_number":161,"box":{"x":69,"y":302,"width":811,"height":11}},{"id":"6480f1bd-58dc-4640-9d35-aad5b5107ab3","block_type":"box","text":"Distributions paid by a Fund that are repor ted as exempt-interest dividends will not be subject to regular U.S. federal","page_number":161,"box":{"x":70,"y":317,"width":829,"height":11}},{"id":"9640da4a-48b6-44dd-80f9-cacb8063a019","block_type":"box","text":"income tax. Cer tain dividend income and long-term capital gains are eligible for taxation at a reduced rate that","page_number":161,"box":{"x":70,"y":332,"width":785,"height":11}},{"id":"d4751c3c-cd6c-4f8e-9863-3b4271a93183","block_type":"box","text":"applies to non-corporate shareholders. Under these rules, the por tion of ordinary income dividends constituting","page_number":161,"box":{"x":69,"y":347,"width":795,"height":11}},{"id":"db09b916-7e75-42f8-82c1-9d041c16d5f8","block_type":"box","text":"“qualified dividend income” when paid by a regulated investment company to a non-corporate shareholder may be","page_number":161,"box":{"x":70,"y":362,"width":809,"height":11}},{"id":"2df14a04-fe99-4d5e-a509-9ea54d94801b","block_type":"box","text":"taxable to such shareholder at long-term capital gain rates provided the shareholder has held the shares on which","page_number":161,"box":{"x":68,"y":377,"width":814,"height":12}},{"id":"b5a29ca7-7b42-477e-b858-fdeeb43aa09b","block_type":"box","text":"the dividend was paid for at least 61 days during the 121-day period that begins on the date that is 60 days before","page_number":161,"box":{"x":68,"y":392,"width":822,"height":12}},{"id":"32b5cf3d-5749-41d1-a11e-ed8707ca620d","block_type":"box","text":"the date on which the shares become ex-dividend with respect to such dividend (or, in the case of cer tain","page_number":161,"box":{"x":68,"y":407,"width":751,"height":11}},{"id":"e074b0f7-6e9e-41b9-904d-d1e295ab1c33","block_type":"box","text":"accumulated dividends with respect to preferred stocks, the shareholder has held the shares on which the dividend","page_number":161,"box":{"x":69,"y":423,"width":823,"height":11}},{"id":"ede3add8-27d5-4f1f-b175-acc3ae3dbcc5","block_type":"box","text":"was paid for at least 91 days during the 181-day period that begins on the date that is 90 days before the date on","page_number":161,"box":{"x":68,"y":438,"width":817,"height":11}},{"id":"37bc0f47-3e66-4fe6-b61e-f05240261380","block_type":"box","text":"which the shares become ex-dividend with respect to such dividend). However, to the extent a Fund’s distributions","page_number":161,"box":{"x":68,"y":453,"width":813,"height":11}},{"id":"16b0e97d-60ea-438b-86f4-979212025fbe","block_type":"box","text":"are derived from income on debt securities, cer tain types of preferred stock treated as debt for U.S. federal income","page_number":161,"box":{"x":69,"y":468,"width":825,"height":11}},{"id":"65f93627-f259-43e2-a501-ec514f8eb54a","block_type":"box","text":"tax purposes and shor t-term capital gains, such distributions will not constitute “qualified dividend income.” In","page_number":161,"box":{"x":68,"y":483,"width":789,"height":11}},{"id":"765f7b83-7ecb-4d1f-984f-1e85b093bdf6","block_type":"box","text":"addition, distributions that are derived from securities lending income, such as substitute dividend payments, will not","page_number":161,"box":{"x":69,"y":498,"width":836,"height":11}},{"id":"e0577320-5129-485e-a418-141322b6b5a2","block_type":"box","text":"constitute “qualified dividend income.”","page_number":161,"box":{"x":69,"y":513,"width":275,"height":11}},{"id":"ac65bcc1-5065-482c-a0e2-55c33639c9df","block_type":"box","text":"A 3.8% Medicare tax is imposed on the net investment income (which includes taxable dividends and redemption","page_number":161,"box":{"x":101,"y":536,"width":806,"height":11}},{"id":"3c1c55cf-fdb6-41b2-89c8-41e0aed82c36","block_type":"box","text":"proceeds) of cer tain individuals, trusts and estates.","page_number":161,"box":{"x":70,"y":551,"width":368,"height":11}},{"id":"aaf916ef-5c99-402d-b593-e1fb73f57941","block_type":"box","text":"A Fund’s net capital gain (the excess of net long-term capital gains over net shor t-term capital losses) is not","page_number":161,"box":{"x":101,"y":574,"width":772,"height":11}},{"id":"d8365cb4-d4ee-4387-aab8-75f319818ee5","block_type":"box","text":"subject to the 90% distribution requirement for taxation as a regulated investment company, described above. If a","page_number":161,"box":{"x":69,"y":589,"width":811,"height":11}},{"id":"f6118659-9d05-4594-bca7-d56fe6b9d831","block_type":"box","text":"Fund retains net capital gain, it is subject to tax on that gain, and may designate the retained amount as","page_number":161,"box":{"x":70,"y":604,"width":745,"height":11}},{"id":"674c0b5b-682f-4cd8-addf-44cc86d721ad","block_type":"box","text":"undistributed capital gain in a written statement furnished to its shareholders, who will be required to include in","page_number":161,"box":{"x":69,"y":619,"width":795,"height":11}},{"id":"26bd049e-0d8a-4027-b0db-4e13f2534f59","block_type":"box","text":"income, as long-term capital gain, their propor tionate shares of such undistributed net capital gain, will be deemed to","page_number":161,"box":{"x":70,"y":634,"width":838,"height":12}},{"id":"53ea24eb-946f-491d-b24a-fec1342cb8c1","block_type":"box","text":"have paid and may claim as a credit against their U.S. federal income tax liability (and as a refund to the extent it","page_number":161,"box":{"x":69,"y":649,"width":809,"height":12}},{"id":"a0ce4294-f1fc-4418-9477-a5c4aeb9f983","block_type":"box","text":"exceeds that liability) their propor tionate shares of the tax paid by the Fund on that gain, and shall increase the tax","page_number":161,"box":{"x":69,"y":664,"width":822,"height":12}},{"id":"285759d8-fa69-492e-9b9b-b7ef72e988c3","block_type":"box","text":"basis of their shares in the Fund by the excess of the amount included in income over the amount allowed as a credit","page_number":161,"box":{"x":69,"y":680,"width":838,"height":11}},{"id":"3c4ba5ff-3669-4b11-872d-05de14e8a611","block_type":"box","text":"against their taxes.","page_number":161,"box":{"x":69,"y":695,"width":135,"height":11}},{"id":"a6342805-7c75-490a-ba0d-6971731f1469","block_type":"box","text":"Distributions in excess of a Fund’s current and accumulated earnings and profits will first reduce the adjusted","page_number":161,"box":{"x":102,"y":717,"width":783,"height":12}},{"id":"f02fcc4d-a858-4bf8-91f9-927d24f1b85c","block_type":"box","text":"tax basis of a holder’s shares and after such adjusted tax basis is reduced to zero, will constitute capital gains to","page_number":161,"box":{"x":68,"y":732,"width":812,"height":12}},{"id":"d46930da-b2fa-4223-a0a5-5ec95d0cdfc7","block_type":"box","text":"such holder (assuming the shares are held as a capital asset). Distributions in excess of a Fund’s minimum","page_number":161,"box":{"x":69,"y":748,"width":769,"height":11}},{"id":"50bf6707-c37b-4e0f-9bdd-d16ecd20dd13","block_type":"box","text":"distribution requirements (or taxable income) but not in excess of a Fund’s earnings and profits will be taxable to","page_number":161,"box":{"x":69,"y":763,"width":805,"height":11}},{"id":"c7cb9d11-5c76-4a5c-8c6c-a7a229f34545","block_type":"box","text":"shareholders and will not constitute nontaxable returns of capital. In the case of a Fund with a non-calendar taxable","page_number":161,"box":{"x":69,"y":778,"width":824,"height":11}},{"id":"13d480ff-7530-4954-a29d-aaa8bbfa3cb9","block_type":"box","text":"year, a Fund’s earnings and profits are allocated first to distributions made on or before December 31 of the taxable","page_number":161,"box":{"x":68,"y":793,"width":831,"height":11}},{"id":"fc2dd0b5-9356-4d60-a9ac-70fd90ce15ff","block_type":"box","text":"year, and then to distributions made after December 31 of the taxable year. Any loss upon the sale or exchange of","page_number":161,"box":{"x":68,"y":808,"width":817,"height":11}},{"id":"10bed811-4bfd-4e48-bcac-8180dfc2dd4b","block_type":"box","text":"Fund shares held for six months or less will be treated as long-term capital loss to the extent of any capital gain","page_number":161,"box":{"x":70,"y":823,"width":797,"height":12}},{"id":"37ccd62b-c2ee-45f2-8439-8bd979a3e935","block_type":"box","text":"dividends received by the shareholder.","page_number":161,"box":{"x":69,"y":839,"width":272,"height":10}},{"id":"c8045aa3-d57d-4bf6-89fa-f6b36c95e857","block_type":"box","text":"Ordinary income and capital gain dividends are taxable to shareholders even if they are reinvested in additional","page_number":161,"box":{"x":102,"y":861,"width":792,"height":11}},{"id":"7325599f-36c8-4158-baa2-f27d97b375ea","block_type":"box","text":"shares of a Fund. Distributions by a Fund, whether from ordinary income or capital gains, generally will not be eligible","page_number":161,"box":{"x":69,"y":876,"width":835,"height":11}},{"id":"9fef0100-1abd-4109-8195-c8512b09111d","block_type":"box","text":"for the dividends received deduction allowed to corporations under the Code. If a Fund pays a dividend in January","page_number":161,"box":{"x":68,"y":891,"width":809,"height":11}},{"id":"a5923c26-d74a-4539-a0ea-2a289c2949b9","block_type":"box","text":"that was declared in the previous October, November or December to shareholders of record on a specified date in","page_number":161,"box":{"x":68,"y":906,"width":819,"height":11}},{"id":"9297b7b9-6e6b-4c6e-94ed-72897f5c26d4","block_type":"box","text":"II-130","page_number":161,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"4637a579-206d-4e78-846e-6e6e62595e24","block_type":"box","text":"NM1026U-5982568-161/232","page_number":161,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"45b927b0-7760-4a05-8d11-23930777f6d6","block_type":"box","text":"one of such months, then such dividend will be treated for tax purposes as being paid by the Fund and received by its","page_number":162,"box":{"x":69,"y":45,"width":839,"height":11}},{"id":"5941c63c-9042-4268-95b5-e445f1b5f243","block_type":"box","text":"shareholders on December 31 of the year in which the dividend was declared. In the case of a Fund with a non","page_number":162,"box":{"x":69,"y":60,"width":794,"height":11}},{"id":"d8c6c508-7a24-42e7-8f20-4665cea5f227","block_type":"box","text":"calendar taxable year, if the Fund repor ts more capital gain dividends than it earns in such taxable year, then the","page_number":162,"box":{"x":69,"y":75,"width":804,"height":11}},{"id":"c2928475-ec57-455e-b0b8-683a218e6995","block_type":"box","text":"Fund will reduce the amounts repor ted as capital gains. Where possible, such reduction will first be allocated to","page_number":162,"box":{"x":70,"y":90,"width":797,"height":11}},{"id":"c2db8b7a-7c9a-431e-8afc-5990d411ce95","block_type":"box","text":"dividends made after December 31 of such taxable year. A Fund may elect to defer recognizing, until the following","page_number":162,"box":{"x":69,"y":105,"width":810,"height":11}},{"id":"b1d20476-4cfb-4fd5-b62b-d036ed74c13e","block_type":"box","text":"taxable year, cer tain net capital losses arising after October 31 of the current taxable year, and cer tain net ordinary","page_number":162,"box":{"x":68,"y":120,"width":826,"height":12}},{"id":"5d01c23d-97ff-466c-ae50-023b0d68ae5b","block_type":"box","text":"losses arising after October 31 and/or December 31 of the current taxable year. This may have the effect of","page_number":162,"box":{"x":70,"y":135,"width":772,"height":12}},{"id":"27d33007-b833-43f0-b4c8-762faec03032","block_type":"box","text":"increasing the amount of dividends otherwise includible in the shareholder’s income with respect to the current","page_number":162,"box":{"x":70,"y":150,"width":795,"height":12}},{"id":"9b58e7a4-267b-4d75-8c16-c1d57e4abae8","block_type":"box","text":"taxable year.","page_number":162,"box":{"x":68,"y":166,"width":89,"height":11}},{"id":"6da8119a-f4a3-4643-b6ce-f38316eb64fb","block_type":"box","text":"No gain or loss will be recognized by Investor C shareholders on the conversion to Investor A Shares. A","page_number":162,"box":{"x":102,"y":188,"width":733,"height":12}},{"id":"51c5ac8b-202c-4361-9449-ecd32b51475f","block_type":"box","text":"shareholder’s tax basis in the Investor A Shares acquired upon conversion will be the same as the shareholder’s tax","page_number":162,"box":{"x":69,"y":203,"width":832,"height":11}},{"id":"3852ec47-850f-43ad-9841-2da77143cc9a","block_type":"box","text":"basis in the conver ted Investor C Shares and the holding period of the acquired Investor A Shares will include the","page_number":162,"box":{"x":69,"y":218,"width":809,"height":12}},{"id":"f7323101-00e6-490b-887f-72209df15373","block_type":"box","text":"holding period for the conver ted Investor C Shares.","page_number":162,"box":{"x":69,"y":234,"width":362,"height":11}},{"id":"6da08e39-c09e-4ae9-8314-5ad0ec28f6d1","block_type":"box","text":"If a shareholder of a Fund exercises an exchange privilege within 90 days of acquiring the shares of a Fund, but","page_number":162,"box":{"x":102,"y":256,"width":795,"height":12}},{"id":"7fb90704-3faa-4928-bed6-7ac47df41515","block_type":"box","text":"on or before January 31 of the following year, then the loss that the shareholder recognizes on the exchange will be","page_number":162,"box":{"x":69,"y":271,"width":824,"height":12}},{"id":"0da3fb33-ab05-484b-99aa-b7dc42dfbed3","block_type":"box","text":"reduced (or the gain increased) to the extent any sales charge paid on the exchanged shares reduces any sales","page_number":162,"box":{"x":69,"y":287,"width":797,"height":11}},{"id":"7d242d67-0e7a-4a05-876e-04b4a558ae58","block_type":"box","text":"charge the shareholder would have owed upon the purchase of the new shares in the absence of the exchange","page_number":162,"box":{"x":69,"y":302,"width":791,"height":11}},{"id":"54a7c0c0-b04e-414b-a9a5-32b367acc73c","block_type":"box","text":"privilege. Instead, such sales charge will be treated as an amount paid for the new shares.","page_number":162,"box":{"x":70,"y":317,"width":646,"height":11}},{"id":"2cadc012-1a1e-4f82-bc4d-7151e3fc2c5b","block_type":"box","text":"A sale, redemption, or exchange of Fund shares may give rise to a gain or loss. In general, any gain or loss","page_number":162,"box":{"x":101,"y":339,"width":762,"height":12}},{"id":"e7ca1bfd-e4ba-4dd4-8692-89c1df69c399","block_type":"box","text":"realized upon a taxable disposition of shares of a Fund will be treated as long-term capital gain or loss if such shares","page_number":162,"box":{"x":69,"y":355,"width":836,"height":11}},{"id":"fa8e2d8b-e3a3-4ed1-8d8e-3d5152d03f69","block_type":"box","text":"have been held for more than 12 months. Otherwise, the gain or loss on the taxable disposition of Fund shares will","page_number":162,"box":{"x":69,"y":370,"width":822,"height":11}},{"id":"9046e13f-1cd4-4d23-bbb4-17a8cfa02a56","block_type":"box","text":"generally be treated as shor t-term capital gain or loss. Any loss realized upon a taxable disposition of shares held for","page_number":162,"box":{"x":68,"y":385,"width":838,"height":11}},{"id":"d6d67616-bd45-48b4-a24d-65c13804cf6d","block_type":"box","text":"six months or less will be treated as long-term capital loss, rather than shor t-term capital loss, to the extent of any","page_number":162,"box":{"x":69,"y":400,"width":820,"height":11}},{"id":"7f4bf757-5dcc-4e20-b21e-e8dcadf02123","block_type":"box","text":"amounts treated as distributions to the shareholder of long-term capital gain (including any amounts credited to the","page_number":162,"box":{"x":69,"y":415,"width":823,"height":11}},{"id":"c5122d52-d54e-4f33-8c9a-374893a011d9","block_type":"box","text":"shareholder as undistributed capital gains). Shareholders that hold shares of a Fund through a qualified tax-exempt","page_number":162,"box":{"x":69,"y":430,"width":822,"height":11}},{"id":"2fe7b85d-99e1-4553-9dd2-83055304e21f","block_type":"box","text":"plan described in section 401(a) of the Internal Revenue Code should see the Fund’s Prospectus for a discussion of","page_number":162,"box":{"x":70,"y":445,"width":829,"height":11}},{"id":"6ebe946c-4a4f-41c5-b0e8-e8a82b1df67b","block_type":"box","text":"special tax rules that apply to their investments.","page_number":162,"box":{"x":69,"y":461,"width":343,"height":11}},{"id":"13644f36-bc71-4389-b144-558147b9d7c9","block_type":"box","text":"A loss realized on a sale or exchange of shares of a Fund will be disallowed if other substantially identical shares","page_number":162,"box":{"x":101,"y":483,"width":807,"height":11}},{"id":"a8014157-4b97-4894-9c73-8b88f6b8faf5","block_type":"box","text":"are acquired (whether through the automatic reinvestment of dividends or otherwise) within a 61-day period beginning","page_number":162,"box":{"x":69,"y":498,"width":839,"height":11}},{"id":"8ae720d4-29f2-4edf-b087-71708acce0c2","block_type":"box","text":"30 days before and ending 30 days after the date on which the shares are sold or exchanged. In such case, the","page_number":162,"box":{"x":69,"y":513,"width":799,"height":12}},{"id":"54347cd1-6399-4d96-937b-789a1285f91d","block_type":"box","text":"basis of the shares acquired will be adjusted to reflect the disallowed loss.","page_number":162,"box":{"x":69,"y":528,"width":534,"height":12}},{"id":"9b5994ff-0523-42e0-9feb-b62bccb2b242","block_type":"box","text":"A Fund is also generally required by law to repor t to each shareholder and to the IRS cost basis information for","page_number":162,"box":{"x":101,"y":551,"width":792,"height":11}},{"id":"f2ec8088-18e3-4c33-994e-022ec71b054a","block_type":"box","text":"shares of the Fund acquired on or after January 1, 2012, and sold or redeemed after that date. This information","page_number":162,"box":{"x":69,"y":566,"width":800,"height":11}},{"id":"369d89b9-1b2b-489d-af2e-9a91eac0553b","block_type":"box","text":"includes the adjusted cost basis of the shares, the gross proceeds from disposition, and whether the gain or loss is","page_number":162,"box":{"x":70,"y":581,"width":828,"height":12}},{"id":"03db7f07-2504-4750-9d03-c6182d3d51ad","block_type":"box","text":"long-term or shor t-term. The adjusted cost basis of shares will be based on the default cost basis repor ting method","page_number":162,"box":{"x":70,"y":596,"width":824,"height":12}},{"id":"61710adb-2e1c-4867-84fa-5252e28af657","block_type":"box","text":"selected by the Fund, unless a shareholder, before the sale or redemption, informs the Fund that it has selected a","page_number":162,"box":{"x":69,"y":612,"width":816,"height":11}},{"id":"b17ae64e-42eb-4d89-806e-01e78a3d8557","block_type":"box","text":"different IRS-accepted method offered by the Fund. These requirements, however, will not apply for investments","page_number":162,"box":{"x":69,"y":627,"width":797,"height":11}},{"id":"1e4921b1-d33a-4d99-82aa-796fbac7524a","block_type":"box","text":"through an IRA or other tax-advantaged account. Shareholders should consult their tax advisors to determine the best","page_number":162,"box":{"x":68,"y":642,"width":840,"height":11}},{"id":"ef971047-e2d4-4856-8cb9-f45c5dad610e","block_type":"box","text":"cost basis method for their tax situation, and to obtain more information about how these cost basis repor ting","page_number":162,"box":{"x":69,"y":657,"width":788,"height":11}},{"id":"4c167f11-382a-4ffd-b34a-ac66a24c03b4","block_type":"box","text":"requirements apply to them. For shares of a Fund acquired before January 1, 2012, these requirements will not","page_number":162,"box":{"x":69,"y":672,"width":797,"height":11}},{"id":"f5a33489-9a22-4e9a-81f4-993d708607c1","block_type":"box","text":"apply, but the Fund will continue to repor t to the IRS the gross proceeds received by a shareholder from the sale or","page_number":162,"box":{"x":69,"y":687,"width":821,"height":11}},{"id":"60c0e94d-e3fc-4903-bdc8-601498372b15","block_type":"box","text":"redemption of such shares.","page_number":162,"box":{"x":69,"y":702,"width":195,"height":11}},{"id":"2e277335-f58d-4f00-8caa-31a4c0e80514","block_type":"box","text":"The Manager may determine it is in the best interest of a Fund to distribute por tfolio securities in kind for the","page_number":162,"box":{"x":101,"y":725,"width":780,"height":11}},{"id":"52418cef-310c-4b12-a566-3e3ff1cb284f","block_type":"box","text":"purposes of por tfolio management when meeting redemption requests. When the Manager determines to do so, a","page_number":162,"box":{"x":70,"y":740,"width":814,"height":11}},{"id":"1ba93acf-d008-4b09-8fc0-391160b8f24e","block_type":"box","text":"Fund generally will not recognize taxable gains in respect of the por tfolio securities it distributes to the redeeming","page_number":162,"box":{"x":70,"y":755,"width":810,"height":11}},{"id":"6f366d65-3778-46a0-9bcc-83cadd9de657","block_type":"box","text":"shareholder, which may reduce the amount of taxable gains the Fund would otherwise be required to distribute.","page_number":162,"box":{"x":69,"y":770,"width":793,"height":12}},{"id":"45b65366-465b-4ec0-a3de-b4a5ac973135","block_type":"box","text":"While a Fund may engage in redemptions in kind that have the effect of reducing or eliminating distributable","page_number":162,"box":{"x":101,"y":793,"width":770,"height":11}},{"id":"531709d8-cd4d-4158-a6f4-f264dfc12532","block_type":"box","text":"capital gains as described above, the Funds do not employ a systematic approach to tax management. There is no","page_number":162,"box":{"x":69,"y":808,"width":817,"height":11}},{"id":"9314622d-3622-4fad-a1b5-2ae7f32f2312","block_type":"box","text":"assurance that a Fund can or will be successful in effecting any redemptions in kind and shareholders should expect","page_number":162,"box":{"x":69,"y":823,"width":833,"height":12}},{"id":"e37c7441-4600-41a7-b466-e0fb22429c82","block_type":"box","text":"that each Fund will distribute capital gains.","page_number":162,"box":{"x":68,"y":839,"width":305,"height":11}},{"id":"f4599548-6c89-42a1-a634-3d10ade7fe9c","block_type":"box","text":"Cer tain Funds may invest in derivative contracts such as options, futures contracts, forward contracts and swap","page_number":162,"box":{"x":102,"y":861,"width":799,"height":11}},{"id":"421af44f-8900-4590-9fa7-fcad4e139f93","block_type":"box","text":"agreements. The U.S. federal income tax treatment of a derivative contract may not be as favorable as a direct","page_number":162,"box":{"x":69,"y":876,"width":791,"height":11}},{"id":"a8bfd4ce-aa2c-461b-9bbe-a89be546f478","block_type":"box","text":"investment in the underlying security and may adversely affect the timing, character and amount of income the Fund","page_number":162,"box":{"x":70,"y":891,"width":826,"height":12}},{"id":"31c5c4c5-c19e-4257-90fd-32c1a53f2c40","block_type":"box","text":"realizes from its investments. As a result, a larger por tion of the Fund’s distributions may be treated as ordinary","page_number":162,"box":{"x":69,"y":906,"width":803,"height":12}},{"id":"bfb7bcac-8bb0-46d7-89b2-d7f9235315b7","block_type":"box","text":"II-131","page_number":162,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"173a4b09-b249-4102-badf-7889b3fad0fd","block_type":"box","text":"NM1026U-5982568-162/232","page_number":162,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"35925eeb-0de4-4d62-8b10-a9a3fd3ff6f4","block_type":"box","text":"income rather than capital gains. In addition, section 1256 contracts held by a Fund at the end of each taxable year","page_number":163,"box":{"x":70,"y":45,"width":825,"height":11}},{"id":"1040eb24-450b-4e95-ae53-b39e6af3e0c1","block_type":"box","text":"(and, for purposes of the 4% excise tax, cer tain other dates as prescribed under the Code) are generally “marked-to","page_number":163,"box":{"x":69,"y":60,"width":829,"height":11}},{"id":"84ffa101-0f83-42b0-b945-f1816c520d71","block_type":"box","text":"market,” such that unrealized gains or losses are treated as though they were realized (with such gain or loss being","page_number":163,"box":{"x":69,"y":75,"width":826,"height":11}},{"id":"fdd1b87b-17c5-4d6e-91f4-ff469b6d8739","block_type":"box","text":"considered 60% long-term and 40% shor t-term capital gain or loss), which may increase the amount that must be","page_number":163,"box":{"x":69,"y":90,"width":808,"height":11}},{"id":"07dda58f-e6f5-4020-a0f0-a153bc56312e","block_type":"box","text":"distributed to meet distribution requirements and avoid the excise tax. In addition, the tax treatment of cer tain","page_number":163,"box":{"x":69,"y":105,"width":787,"height":11}},{"id":"af827e81-4fb6-4081-ae73-37091f3256e2","block_type":"box","text":"derivative contracts, such as swap agreements, is unsettled and may be subject to future legislation, regulation or","page_number":163,"box":{"x":69,"y":120,"width":816,"height":12}},{"id":"3a3344c3-d4f4-4f6c-9112-55985e86e9d6","block_type":"box","text":"administrative pronouncements issued by the IRS. If such future guidance limits the Fund’s ability to use derivatives,","page_number":163,"box":{"x":69,"y":135,"width":832,"height":12}},{"id":"905259c1-45b4-4e29-bd19-671bccc60e06","block_type":"box","text":"the Fund may have to find other ways of achieving its investment objectives.","page_number":163,"box":{"x":68,"y":150,"width":542,"height":12}},{"id":"ba6cef07-e870-49fd-96ad-a311e76264e9","block_type":"box","text":"Cer tain swap agreements, including exchange-traded swap agreements, are treated as notional principal","page_number":163,"box":{"x":102,"y":173,"width":744,"height":11}},{"id":"48ae3cc1-c92c-4a09-8e0c-f4df8d381b2b","block_type":"box","text":"contracts rather than as section 1256 contracts. This can affect the type of income earned by such swap","page_number":163,"box":{"x":69,"y":188,"width":751,"height":11}},{"id":"e1ca6ae6-e80c-419b-9d1a-9be79dfaa908","block_type":"box","text":"agreements since all the income on a notional principal contract may be ordinary income, whereas 40% of the gain","page_number":163,"box":{"x":69,"y":203,"width":819,"height":12}},{"id":"9e644107-ce09-4488-aaa3-1f907ccc7598","block_type":"box","text":"on a section 1256 contract is treated as shor t-term capital gain taxed at ordinary rates and 60% is treated as long","page_number":163,"box":{"x":69,"y":219,"width":823,"height":11}},{"id":"e9d60373-ef49-4ce5-94fc-1dece5950432","block_type":"box","text":"term capital gain taxed at more favorable rates when distributed to shareholders. The rest is long-term capital gain,","page_number":163,"box":{"x":68,"y":234,"width":823,"height":11}},{"id":"1bd2d9db-5eee-4570-b7ed-c8cbfd56c8b5","block_type":"box","text":"which may be taxable at more favorable rates than ordinary income. Proposed regulations interpret what types of","page_number":163,"box":{"x":68,"y":249,"width":807,"height":11}},{"id":"5739a96d-f868-4887-b05c-f8a17f1a8af2","block_type":"box","text":"swap agreements are to be treated as notional principal contracts rather than as section 1256 contracts. When","page_number":163,"box":{"x":69,"y":264,"width":797,"height":11}},{"id":"6bba278f-7f8b-44bc-b1e7-1cd77a79e23d","block_type":"box","text":"finalized, these regulations could result in the Fund having to treat more of its income on swap agreements and more","page_number":163,"box":{"x":68,"y":279,"width":838,"height":11}},{"id":"9d3397d0-f67d-48a6-b2dd-88058a1557da","block_type":"box","text":"of the distributions made to shareholders as ordinary income and less as long-term capital gains.","page_number":163,"box":{"x":69,"y":294,"width":695,"height":11}},{"id":"ecd9be41-1938-4c30-ae90-af38064d837b","block_type":"box","text":"Cer tain Funds may invest in zero coupon U.S. Treasury bonds and other debt securities that are issued at a","page_number":163,"box":{"x":102,"y":317,"width":768,"height":11}},{"id":"e2477086-dfb5-4485-8ae6-a468b8924978","block_type":"box","text":"discount or provide for deferred interest. Even though a Fund receives no actual interest payments on these","page_number":163,"box":{"x":69,"y":332,"width":769,"height":11}},{"id":"b183be62-bf1f-4b1e-84f2-44ce0b7930ae","block_type":"box","text":"securities, it will be deemed to receive income equal, generally, to a por tion of the excess of the stated redemption","page_number":163,"box":{"x":69,"y":347,"width":822,"height":11}},{"id":"7bb540e4-e4a5-463f-8638-f0a4802dfce1","block_type":"box","text":"price of the securities over their issue price (“original issue discount”) each year that the securities are held. Since","page_number":163,"box":{"x":70,"y":362,"width":819,"height":11}},{"id":"c4b3706f-2ace-49d2-b0c0-6a05ccf3e406","block_type":"box","text":"the original issue discount income earned by a Fund in a taxable year may not be represented by cash income, the","page_number":163,"box":{"x":68,"y":377,"width":818,"height":12}},{"id":"b4707ae2-29dc-46fc-aa69-94f8aba1f029","block_type":"box","text":"Fund may have to dispose of securities, which it might otherwise have continued to hold, or borrow to generate cash","page_number":163,"box":{"x":70,"y":392,"width":830,"height":12}},{"id":"a71ff7c2-42d0-4eb6-84fa-7b8de94fe0ca","block_type":"box","text":"in order to satisfy its distribution requirements. In addition, a Fund’s investment in foreign currencies or foreign","page_number":163,"box":{"x":70,"y":407,"width":792,"height":12}},{"id":"2bfd5973-fb88-4f9c-b258-8a9204a53f42","block_type":"box","text":"currency denominated or referenced debt securities, cer tain asset-backed securities and contingent payment and","page_number":163,"box":{"x":69,"y":423,"width":808,"height":11}},{"id":"3d7a9a45-6c9c-4e4a-9d93-b35a9c481970","block_type":"box","text":"inflation-indexed debt instruments also may increase or accelerate the Fund’s recognition of income, including the","page_number":163,"box":{"x":70,"y":438,"width":812,"height":11}},{"id":"dc1e6a69-3aec-4e90-b637-608bfe77c5d0","block_type":"box","text":"recognition of taxable income in excess of cash generated by such investments. Any transaction by the Fund in","page_number":163,"box":{"x":69,"y":453,"width":789,"height":11}},{"id":"3502ed14-0cda-4c9c-9c3e-ab675b1f542b","block_type":"box","text":"foreign currencies, foreign currency-denominated debt obligations or cer tain foreign currency options, futures","page_number":163,"box":{"x":68,"y":468,"width":777,"height":11}},{"id":"829beb18-2a9c-463d-9bce-7b3be1f65e41","block_type":"box","text":"contracts or forward contracts (or similar instruments) may give rise to ordinary income or loss to the extent such","page_number":163,"box":{"x":69,"y":483,"width":810,"height":11}},{"id":"0d148189-d20e-456f-8ddf-b88404d7dbce","block_type":"box","text":"income or loss results from fluctuations in the value of the foreign currency concerned. Any such net gains could","page_number":163,"box":{"x":70,"y":498,"width":801,"height":11}},{"id":"2197c433-0398-4134-9c9b-1cfd48d759cb","block_type":"box","text":"require a larger dividend toward the end of the calendar year. Any such net losses will generally reduce and","page_number":163,"box":{"x":69,"y":513,"width":762,"height":12}},{"id":"8c10fd46-a00c-4b2f-8791-cb1a7d74c686","block_type":"box","text":"potentially require the recharacterization of prior ordinary income distributions. Such ordinary income treatment may","page_number":163,"box":{"x":70,"y":528,"width":827,"height":12}},{"id":"a0c665a9-f192-4b7d-ac88-2c543910e2f8","block_type":"box","text":"accelerate Fund distributions to shareholders and increase the distributions taxed to shareholders as ordinary","page_number":163,"box":{"x":69,"y":544,"width":787,"height":11}},{"id":"d951ef49-daf0-4d3c-8e5f-1d990111f393","block_type":"box","text":"income. Any net ordinary losses so created cannot be carried forward by the Fund to offset income or gains earned","page_number":163,"box":{"x":70,"y":559,"width":822,"height":11}},{"id":"fe525437-7d56-4df8-b722-e21b1863f6da","block_type":"box","text":"in subsequent taxable years.","page_number":163,"box":{"x":70,"y":574,"width":203,"height":11}},{"id":"b38c1a1d-5490-4527-99ea-8e0b23d780fe","block_type":"box","text":"Ordinary income dividends paid to shareholders who are nonresident aliens or foreign entities (other than pass","page_number":163,"box":{"x":102,"y":596,"width":795,"height":12}},{"id":"6b929389-10d4-4925-9998-71055ec95937","block_type":"box","text":"through entities to the extent owned by U.S. persons) generally will be subject to a 30% U.S. withholding tax under","page_number":163,"box":{"x":68,"y":612,"width":816,"height":11}},{"id":"d049d072-4fdf-40d9-b376-4b9cd4fe83f6","block_type":"box","text":"existing provisions of the Code applicable to foreign individuals and entities unless a reduced rate of withholding or a","page_number":163,"box":{"x":69,"y":627,"width":835,"height":11}},{"id":"0bb33767-3d60-407f-bfb9-cbc089037ef8","block_type":"box","text":"withholding exemption is provided under applicable treaty law. Capital gain dividends paid to shareholders that are","page_number":163,"box":{"x":68,"y":642,"width":815,"height":11}},{"id":"ee57c24f-1547-4de8-9b85-6d23aefae108","block_type":"box","text":"nonresident aliens or foreign entities, if and to the extent properly repor ted as capital gain dividends, generally will","page_number":163,"box":{"x":69,"y":657,"width":816,"height":11}},{"id":"799449a4-1777-48d9-aa11-4f716c36eac1","block_type":"box","text":"not be subject to a 30% withholding tax, unless cer tain exceptions apply. Dividends derived by a regulated investment","page_number":163,"box":{"x":69,"y":672,"width":840,"height":11}},{"id":"71f14ec9-297e-4ab3-8547-2ca79237ea7e","block_type":"box","text":"company from shor t-term capital gains and qualified net interest income (including income from original issue","page_number":163,"box":{"x":69,"y":687,"width":781,"height":11}},{"id":"246ac921-975e-45a1-8210-a9f493a42b86","block_type":"box","text":"discount and market discount) and paid to shareholders who are nonresident aliens or foreign entities, if and to the","page_number":163,"box":{"x":69,"y":702,"width":824,"height":12}},{"id":"00982336-3b26-4887-aea0-1d4cfe32ebda","block_type":"box","text":"extent properly repor ted as “shor t-term capital gain dividends” or “interest-related dividends”, respectively, generally","page_number":163,"box":{"x":69,"y":718,"width":832,"height":11}},{"id":"505d00c4-70bc-48b1-878f-bf4e685e127d","block_type":"box","text":"will not be subject to U.S. withholding tax. Where possible, the Funds intend to repor t such dividends as interest","page_number":163,"box":{"x":68,"y":733,"width":808,"height":11}},{"id":"40d5ba1a-a133-48d1-ae78-7fb35cf0e1b6","block_type":"box","text":"related dividends or shor t-term capital gain dividends. However, depending on its circumstances, a Fund may repor t","page_number":163,"box":{"x":69,"y":748,"width":826,"height":11}},{"id":"1879d745-ac0c-4cd3-9a4a-c60bdec09833","block_type":"box","text":"all, some or none of its potentially eligible dividends as interest-related or as shor t-term capital gain dividends, and/","page_number":163,"box":{"x":69,"y":763,"width":830,"height":11}},{"id":"25b35627-3eb0-4e4d-a17d-b27a5c0de29b","block_type":"box","text":"or treat such dividends, in whole or in par t, as ineligible for this exemption from withholding. In order to qualify for","page_number":163,"box":{"x":69,"y":778,"width":811,"height":11}},{"id":"bfccfc61-f52e-4fd6-ad64-a9d751f9b743","block_type":"box","text":"this exemption from withholding, a foreign shareholder must comply with applicable cer tification requirements","page_number":163,"box":{"x":68,"y":793,"width":784,"height":11}},{"id":"fe4d19b3-b90a-4d26-b972-f272a3d9e51f","block_type":"box","text":"relating to its foreign status (including, in general, furnishing an IRS Form W-8BEN, IRS Form W-8BEN-E or substitute","page_number":163,"box":{"x":69,"y":808,"width":828,"height":11}},{"id":"7795b24b-db0b-4f35-a260-09f1f9d18318","block_type":"box","text":"Form). In the case of shares held through an intermediary, the intermediary may withhold even if the Fund repor ts the","page_number":163,"box":{"x":70,"y":823,"width":839,"height":12}},{"id":"2d9fe7c7-d6da-45c2-b167-d4a5e500ef74","block_type":"box","text":"payment as an interest-related or shor t-term capital gain dividend. Foreign shareholders should contact their","page_number":163,"box":{"x":70,"y":839,"width":772,"height":11}},{"id":"f6041f18-5d93-4bcd-9541-f90804e1e20d","block_type":"box","text":"intermediaries with respect to the application of these rules to their accounts. It is not possible to predict what","page_number":163,"box":{"x":70,"y":853,"width":791,"height":11}},{"id":"4340e090-b5c1-4e00-bf47-67a46892e17e","block_type":"box","text":"por tion, if any, of a Fund’s distributions will be repor ted as interest-related dividends or shor t-term capital gain","page_number":163,"box":{"x":70,"y":869,"width":787,"height":11}},{"id":"a67e7934-add7-44b8-8ef1-a1fac7ef58e1","block_type":"box","text":"dividends under these rules.","page_number":163,"box":{"x":69,"y":884,"width":201,"height":9}},{"id":"323636a9-a18f-48b7-993a-402676332345","block_type":"box","text":"II-132","page_number":163,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"b77469fa-73a7-43e8-9b90-832c1f84a666","block_type":"box","text":"NM1026U-5982568-163/232","page_number":163,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"43e380d4-f634-403d-957b-2ebe3c4db742","block_type":"box","text":"Distributions to cer tain foreign shareholders by a Fund at least 50% of the assets of which are “U.S. real","page_number":164,"box":{"x":102,"y":45,"width":747,"height":11}},{"id":"576eb536-1cbe-4b7c-85e1-799334aab609","block_type":"box","text":"proper ty interests” (as defined in the Code and Treasury regulations) at any time during the five-year period ending on","page_number":164,"box":{"x":70,"y":60,"width":838,"height":11}},{"id":"05e0e0cb-0b07-41b3-8fbb-fb4d4f8f158c","block_type":"box","text":"the date of the distributions, to the extent the distributions are attributable to gains from sales or exchanges of U.S.","page_number":164,"box":{"x":68,"y":75,"width":829,"height":11}},{"id":"ed7944a1-2beb-42f1-9c76-f1de85a0ac28","block_type":"box","text":"real proper ty interests (including shares in cer tain “U.S. real proper ty holding corporations” such as cer tain REITs,","page_number":164,"box":{"x":69,"y":90,"width":817,"height":11}},{"id":"dadb1c3a-1cad-485d-83fc-16c91f1671b2","block_type":"box","text":"although exceptions may apply if any class of stock of such a corporation is regularly traded on an established","page_number":164,"box":{"x":69,"y":105,"width":786,"height":11}},{"id":"34e5c161-7a24-4520-abf1-aa8a8d09e285","block_type":"box","text":"securities market and the Fund has held no more than 5% of such class of stock at all times during the five-year","page_number":164,"box":{"x":69,"y":120,"width":800,"height":12}},{"id":"f734603d-8f95-4262-a9f4-509c54154721","block_type":"box","text":"period ending on the date of the distributions), generally must be treated by such foreign shareholders as income","page_number":164,"box":{"x":70,"y":135,"width":807,"height":12}},{"id":"a0ac8ea1-1bf0-40e4-a46c-afa3d4178bff","block_type":"box","text":"effectively connected to a trade or business within the United States, which is generally subject to tax at the","page_number":164,"box":{"x":69,"y":150,"width":772,"height":12}},{"id":"4452d017-d082-4b7a-a576-6d2c9241f261","block_type":"box","text":"graduated rates applicable to U.S. shareholders, except for distributions to foreign shareholders that held no more","page_number":164,"box":{"x":68,"y":166,"width":818,"height":11}},{"id":"c3d65b60-8b72-41d9-8cc3-66395be5b166","block_type":"box","text":"than 5% of any class of stock of the Fund at all times during the previous one-year period ending on the date of the","page_number":164,"box":{"x":68,"y":181,"width":820,"height":11}},{"id":"6984d99b-4bf9-4a43-a670-1f65ec3c3df3","block_type":"box","text":"distributions. Such distributions will be subject to U.S. income and withholding tax and generally will require a foreign","page_number":164,"box":{"x":69,"y":196,"width":833,"height":11}},{"id":"ca789c26-a042-4cb4-87aa-b646cf3b2515","block_type":"box","text":"shareholder to file a U.S. federal income tax return. If the foreign shareholder held no more than 5% of any class of","page_number":164,"box":{"x":69,"y":211,"width":823,"height":11}},{"id":"14f6e3d6-0dc6-4bc2-8b24-9e3f1b3457a8","block_type":"box","text":"stock of the Fund at all times during the previous one-year period ending on the date of the distributions, the","page_number":164,"box":{"x":69,"y":226,"width":774,"height":11}},{"id":"d7e2404a-5ea2-4b81-ac83-a40b31ae5476","block_type":"box","text":"distributions will be taxable as ordinary dividends and subject to withholding at a 30% or lower treaty rate. In addition,","page_number":164,"box":{"x":69,"y":241,"width":839,"height":11}},{"id":"0882d5aa-f815-4d8e-a723-ec94ca6fd011","block_type":"box","text":"sales or redemptions of shares held by cer tain foreign shareholders in such a Fund generally will be subject to U.S.","page_number":164,"box":{"x":69,"y":256,"width":822,"height":12}},{"id":"9be59d90-7d55-44b4-a885-9d3b6964c046","block_type":"box","text":"income and withholding tax and generally will require the foreign shareholder to file a U.S. federal income tax return,","page_number":164,"box":{"x":70,"y":271,"width":827,"height":12}},{"id":"1c2abbb0-9b9c-4c48-9721-bbece4a81cce","block_type":"box","text":"although exceptions may apply if more than 50% of the value of the Fund’s shares are held by U.S. shareholders or","page_number":164,"box":{"x":69,"y":286,"width":823,"height":12}},{"id":"5701afbe-db77-4a45-9dda-5b9f845f3992","block_type":"box","text":"the foreign shareholder selling or redeeming the shares has held no more than 5% of any class of stock of the Fund","page_number":164,"box":{"x":68,"y":302,"width":827,"height":11}},{"id":"52d9d175-006d-4c05-a67d-9a27c978a94d","block_type":"box","text":"at all times during the five-year period ending on the date of the sale or redemption.","page_number":164,"box":{"x":69,"y":317,"width":596,"height":11}},{"id":"bcd389df-fc2a-476c-bcd5-c5208368df1d","block_type":"box","text":"Provided that more than 50% of the value of a Fund’s stock is held by U.S. shareholders, redemptions and other","page_number":164,"box":{"x":102,"y":339,"width":802,"height":12}},{"id":"feaf84b0-0be8-42a0-932b-ebd3a2672af0","block_type":"box","text":"distributions made in the form of U.S. real proper ty interests (including shares in cer tain “U.S. real proper ty holding","page_number":164,"box":{"x":69,"y":355,"width":827,"height":11}},{"id":"7ebc9492-6b38-4ac4-8768-9d6c4ff80eba","block_type":"box","text":"corporations”, although exceptions may apply if any class of stock of such a corporation is regularly traded on an","page_number":164,"box":{"x":69,"y":370,"width":804,"height":11}},{"id":"76341a98-a649-4e61-ba46-104940a86d40","block_type":"box","text":"established securities market and the Fund has held no more than 5% of such class of stock at all times during the","page_number":164,"box":{"x":69,"y":385,"width":824,"height":11}},{"id":"1fdc3ba2-1b46-4fed-b396-f8d96dfaed14","block_type":"box","text":"five-year period ending on the date of the distribution) generally will cause the Fund to recognize a por tion of any","page_number":164,"box":{"x":68,"y":400,"width":801,"height":11}},{"id":"4ac21103-489d-45cb-9175-d5e1378864eb","block_type":"box","text":"unrecognized gain in the U.S. real proper ty interests equal to the product of (i) the excess of fair market value of","page_number":164,"box":{"x":69,"y":415,"width":803,"height":11}},{"id":"59238841-bcf7-4b6b-9090-b924fe32f823","block_type":"box","text":"such U.S. real proper ty interests over the Fund’s adjusted bases in such interests and (ii) the greatest foreign","page_number":164,"box":{"x":69,"y":430,"width":785,"height":11}},{"id":"a747003f-5b1d-4865-b2cd-529f31b8cf13","block_type":"box","text":"ownership percentage of the Fund during the five-year period ending on the date of distribution.","page_number":164,"box":{"x":69,"y":445,"width":676,"height":12}},{"id":"cbf9514e-d601-4590-b4d6-13551ae3e75b","block_type":"box","text":"A foreign shareholder may also be subject to cer tain “wash sale” rules to prevent the avoidance of the tax filing","page_number":164,"box":{"x":101,"y":468,"width":798,"height":11}},{"id":"bd345684-8eef-402c-a8c0-43fb7412b012","block_type":"box","text":"and payment obligations discussed above through the sale and repurchase of Fund shares.","page_number":164,"box":{"x":69,"y":483,"width":651,"height":11}},{"id":"27ff2454-8b70-4696-a9a4-ee0dc5deaf66","block_type":"box","text":"Shareholders that are nonresident aliens or foreign entities are urged to consult their own tax advisors","page_number":164,"box":{"x":102,"y":506,"width":731,"height":11}},{"id":"2942d3f1-fda1-4d9e-9bcb-542869b4cba9","block_type":"box","text":"concerning the par ticular tax consequences to them of an investment in a Fund.","page_number":164,"box":{"x":69,"y":521,"width":570,"height":11}},{"id":"696085bf-3af6-47b9-80d6-5bc11e8eefef","block_type":"box","text":"Separately, a 30% withholding tax is currently imposed on U.S.-source dividends, interest and other income","page_number":164,"box":{"x":102,"y":544,"width":763,"height":11}},{"id":"37608879-00cb-48ae-beb7-c8a0a3cd9b5a","block_type":"box","text":"items paid to (i) cer tain foreign financial institutions and investment funds, and (ii) cer tain other foreign entities. To","page_number":164,"box":{"x":70,"y":559,"width":820,"height":11}},{"id":"2e40c949-76f4-4322-bae4-afd84dc8c021","block_type":"box","text":"avoid withholding, foreign financial institutions and investment funds will generally either need to (a) collect and","page_number":164,"box":{"x":69,"y":574,"width":794,"height":11}},{"id":"677b9bba-59d2-4cd4-827c-6560820ea3e1","block_type":"box","text":"repor t to the IRS detailed information identifying their U.S. accounts and U.S. account holders, comply with due","page_number":164,"box":{"x":69,"y":589,"width":794,"height":11}},{"id":"230e3a78-db98-4b4e-b254-476b68128877","block_type":"box","text":"diligence procedures for identifying U.S. accounts and withhold tax on cer tain payments made to noncomplying","page_number":164,"box":{"x":69,"y":604,"width":791,"height":11}},{"id":"51e31335-caf0-47d2-bf7c-3eae7964d917","block_type":"box","text":"foreign entities and account holders or (b) if an intergovernmental agreement is entered into and implementing","page_number":164,"box":{"x":68,"y":619,"width":791,"height":11}},{"id":"ece73c25-c4bd-4462-bcdd-3fe6cdf19e94","block_type":"box","text":"legislation is adopted, comply with the agreement and legislation. Other foreign entities will generally either need to","page_number":164,"box":{"x":70,"y":634,"width":822,"height":12}},{"id":"24397447-9c7b-4499-82df-a6457a6f0a7d","block_type":"box","text":"provide detailed information identifying each substantial U.S. owner or cer tify there are no such owners.","page_number":164,"box":{"x":70,"y":649,"width":739,"height":12}},{"id":"67b355a8-cf1e-49a1-862e-23094f3f740c","block_type":"box","text":"Under cer tain provisions of the Code, some shareholders may be subject to a 24% withholding tax on ordinary","page_number":164,"box":{"x":102,"y":672,"width":786,"height":11}},{"id":"f7fea9e0-2897-429e-83ac-e1d99ee597d8","block_type":"box","text":"income dividends, capital gain dividends and redemption payments (“backup withholding”). Generally, shareholders","page_number":164,"box":{"x":70,"y":687,"width":820,"height":11}},{"id":"2e849f60-9dfa-4b16-b205-46fc354b8b3f","block_type":"box","text":"subject to backup withholding will be non-corporate shareholders for whom no cer tified taxpayer identification number","page_number":164,"box":{"x":69,"y":702,"width":837,"height":12}},{"id":"669e8360-17f8-4b39-a92e-482e8c31f3c4","block_type":"box","text":"is on file with the Fund or who, to the Fund’s knowledge, have furnished an incorrect number. When establishing an","page_number":164,"box":{"x":70,"y":717,"width":821,"height":12}},{"id":"6f0d4da1-3ec4-46aa-9e1f-f7a9a0ecec58","block_type":"box","text":"account, an investor must cer tify under penalty of perjury that such number is correct and that such investor is not","page_number":164,"box":{"x":69,"y":732,"width":819,"height":12}},{"id":"430e3de3-eae1-4d3d-9140-20702352f470","block_type":"box","text":"otherwise subject to backup withholding. Backup withholding is not an additional tax. Any amount withheld generally","page_number":164,"box":{"x":69,"y":748,"width":826,"height":11}},{"id":"427913e1-30d4-460e-b517-54cf8bc00d7d","block_type":"box","text":"may be allowed as a refund or a credit against a shareholder’s U.S. federal income tax liability, provided that the","page_number":164,"box":{"x":69,"y":763,"width":802,"height":11}},{"id":"f26aaaf8-9800-4f89-94f9-9dda813c760e","block_type":"box","text":"required information is timely forwarded to the IRS.","page_number":164,"box":{"x":69,"y":778,"width":364,"height":11}},{"id":"c4d76dcd-f09d-4a10-9e94-c016ab41a5d1","block_type":"box","text":"If a shareholder recognizes a loss with respect to a Fund’s shares of at least $2 million in any single taxable","page_number":164,"box":{"x":102,"y":800,"width":774,"height":12}},{"id":"889ca6ef-9618-4124-99b2-f50963dab5d8","block_type":"box","text":"year or $4 million in any combination of taxable years for an individual shareholder or $10 million in any single","page_number":164,"box":{"x":68,"y":815,"width":787,"height":12}},{"id":"21960521-2ab9-47d1-b2c0-4d7315cc47c7","block_type":"box","text":"taxable year or $20 million in any combination of taxable years for a corporate shareholder in any single taxable year,","page_number":164,"box":{"x":68,"y":830,"width":835,"height":12}},{"id":"414ba553-25f4-48d5-975e-998eb2e8d564","block_type":"box","text":"the shareholder must file a disclosure statement on IRS Form 8886 with the IRS. Direct shareholders of por tfolio","page_number":164,"box":{"x":68,"y":846,"width":809,"height":11}},{"id":"60251adf-5b8b-4cdd-ae89-5c9aef9d751e","block_type":"box","text":"securities are in many cases exempted. That a loss is repor table under these regulations does not affect the legal","page_number":164,"box":{"x":69,"y":861,"width":817,"height":11}},{"id":"76efd920-1bd4-43f1-a889-d9d621fd80f2","block_type":"box","text":"determination of whether the taxpayer’s treatment of the loss is proper. Shareholders should consult their tax","page_number":164,"box":{"x":69,"y":876,"width":783,"height":11}},{"id":"e6093c5d-ad2d-4c95-88f0-c0af68342bad","block_type":"box","text":"advisors to determine the applicability of these regulations in light of their individual circumstances.","page_number":164,"box":{"x":69,"y":891,"width":710,"height":12}},{"id":"766d298d-592a-4132-9aa3-65a7e337b49c","block_type":"box","text":"II-133","page_number":164,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"6754b741-d347-41ff-97ae-65b5828930b8","block_type":"box","text":"NM1026U-5982568-164/232","page_number":164,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"7296fd4d-0cf3-4cce-a329-3b205fb17201","block_type":"box","text":"Cer tain types of income received by a Fund from REITs, real estate mor tgage investment conduits, taxable","page_number":165,"box":{"x":102,"y":45,"width":758,"height":11}},{"id":"29e2e620-cc14-4d99-9e65-3201235047a5","block_type":"box","text":"mor tgage pools or other investments may cause the Fund to repor t some or all of its distributions as “excess","page_number":165,"box":{"x":69,"y":60,"width":782,"height":11}},{"id":"35cb5f80-e35d-4a34-bb04-1b09d1ceddb3","block_type":"box","text":"inclusion income.” To Fund shareholders, such excess inclusion income may: (i) constitute taxable income, as","page_number":165,"box":{"x":70,"y":75,"width":783,"height":11}},{"id":"65791105-ec51-45c9-8954-42fadd4af4bb","block_type":"box","text":"unrelated business taxable income (“UBTI”) for those shareholders who would otherwise be tax-exempt such as","page_number":165,"box":{"x":69,"y":90,"width":797,"height":11}},{"id":"ecb47e13-115e-44b9-aa96-ce3f96c24874","block_type":"box","text":"individual retirement accounts, 401(k) accounts, Keogh plans, pension plans and cer tain charitable entities; (ii) not","page_number":165,"box":{"x":70,"y":105,"width":822,"height":11}},{"id":"d535a8df-ab1d-4368-a977-2163f2b25d3e","block_type":"box","text":"be offset by otherwise allowable deductions for tax purposes; (iii) not be eligible for reduced U.S. withholding for non","page_number":165,"box":{"x":69,"y":120,"width":836,"height":12}},{"id":"a3879518-9856-4f75-a5d7-074ef3c94f48","block_type":"box","text":"U.S. shareholders even from tax treaty countries; and (iv) cause the Fund to be subject to tax if cer tain “disqualified","page_number":165,"box":{"x":70,"y":135,"width":826,"height":11}},{"id":"ebb34289-b224-4baf-be7b-7c48d23baa70","block_type":"box","text":"organizations,” as defined by the Code, are Fund shareholders. The Fund tries to avoid investing in REITs that are","page_number":165,"box":{"x":69,"y":150,"width":808,"height":12}},{"id":"1a69bb26-c280-4b58-9791-e469059b8fbd","block_type":"box","text":"expected to generate excess inclusion income, but the Fund may not always be successful in doing so. Because","page_number":165,"box":{"x":69,"y":166,"width":800,"height":11}},{"id":"ed21ee9b-42a8-413c-b764-3c983fc43344","block_type":"box","text":"information about a REIT’s investments may be inadequate or inaccurate, or because a REIT may change its","page_number":165,"box":{"x":70,"y":181,"width":770,"height":11}},{"id":"a838eef9-51d0-4048-bb25-eb90f0acf9fd","block_type":"box","text":"investment program, the Fund may not be successful in avoiding the consequences described above. Avoidance of","page_number":165,"box":{"x":70,"y":196,"width":816,"height":11}},{"id":"c168ffdd-7925-47c8-9ce9-c99d29a543d8","block_type":"box","text":"investments in REITs that generate excess inclusion income may require the Fund to forego otherwise attractive","page_number":165,"box":{"x":70,"y":211,"width":796,"height":11}},{"id":"e5de2b8c-e945-427b-8f19-6bd3edc4c2e8","block_type":"box","text":"investment oppor tunities.","page_number":165,"box":{"x":70,"y":226,"width":180,"height":11}},{"id":"ba0eb2fc-6426-48aa-97c9-b8e8762dce9b","block_type":"box","text":"Dividends and interest received and capital gains realized by a Fund may give rise to withholding and other taxes","page_number":165,"box":{"x":102,"y":249,"width":801,"height":11}},{"id":"2ef9b7b9-f427-413a-bb98-ac0b31dae7c9","block_type":"box","text":"imposed by foreign countries. Tax conventions between cer tain foreign countries and the United States may reduce or","page_number":165,"box":{"x":70,"y":264,"width":839,"height":11}},{"id":"af66062e-9f9c-4be6-88b4-1d25d6898621","block_type":"box","text":"eliminate such taxes. Shareholders of a Fund more than 50% by value of the assets of which at the close of a taxable","page_number":165,"box":{"x":69,"y":279,"width":840,"height":11}},{"id":"9707f0e6-a03a-41c0-a027-3739e0366415","block_type":"box","text":"year are foreign securities may be able to claim U.S. foreign tax credits with respect to such foreign taxes paid by the","page_number":165,"box":{"x":68,"y":294,"width":837,"height":11}},{"id":"a514d829-e059-4097-a845-93b27fe54720","block_type":"box","text":"Fund, subject to cer tain requirements and limitations contained in the Code. For example, cer tain retirement","page_number":165,"box":{"x":70,"y":309,"width":774,"height":11}},{"id":"1510424b-e58b-4e69-9df5-ae489dda3724","block_type":"box","text":"accounts and cer tain tax-exempt organizations cannot claim foreign tax credits on investments in foreign securities","page_number":165,"box":{"x":69,"y":324,"width":820,"height":12}},{"id":"9274f781-4781-4fd2-bb8f-35a90d1474e6","block_type":"box","text":"held in a Fund. In addition, a foreign tax credit may be claimed with respect to withholding tax on payments with","page_number":165,"box":{"x":69,"y":339,"width":795,"height":12}},{"id":"7f2c7ac6-c638-4749-b7a1-4285e82606d3","block_type":"box","text":"respect to a security only if the holder of the security meets cer tain holding period requirements. Both the","page_number":165,"box":{"x":69,"y":355,"width":755,"height":11}},{"id":"47a26c21-214c-4068-8421-b5faf2f975ad","block_type":"box","text":"shareholder and the Fund must meet these holding period requirements, and if a Fund fails to do so, it will not be","page_number":165,"box":{"x":69,"y":370,"width":811,"height":11}},{"id":"436b1c16-6e82-4a18-8466-fcc9af6870a6","block_type":"box","text":"able to “pass through” to shareholders the ability to claim a credit or a deduction for the related foreign taxes paid by","page_number":165,"box":{"x":69,"y":385,"width":839,"height":11}},{"id":"b6350299-04a2-4ef0-ba4d-b76a00da0059","block_type":"box","text":"the Fund. Fur ther, to the extent that a Fund engages in securities lending with respect to a security paying income","page_number":165,"box":{"x":68,"y":400,"width":812,"height":11}},{"id":"00c61d1e-a94e-4ae6-81b9-cd170b79b72e","block_type":"box","text":"subject to foreign taxes, it may not be able to pass through to its shareholders the ability to take a foreign tax credit","page_number":165,"box":{"x":69,"y":415,"width":829,"height":11}},{"id":"daffb421-5258-406c-8e92-66baddac7bde","block_type":"box","text":"for those taxes. If a Fund satisfies the applicable requirements, such Fund will be eligible to file an election with the","page_number":165,"box":{"x":68,"y":430,"width":827,"height":11}},{"id":"e999d6af-0308-4f23-9784-7ed7be5a026f","block_type":"box","text":"IRS pursuant to which shareholders of the Fund will be required to include their propor tionate shares of such foreign","page_number":165,"box":{"x":70,"y":445,"width":829,"height":12}},{"id":"3eb43e2e-2041-4cbb-a7d3-63443e1685fa","block_type":"box","text":"taxes in their U.S. income tax returns as gross income, treat such propor tionate shares as taxes paid by them, and","page_number":165,"box":{"x":68,"y":460,"width":825,"height":12}},{"id":"d3eb2f12-95b0-46ef-81e2-e579eed34adb","block_type":"box","text":"deduct such propor tionate shares in computing their taxable incomes or, alternatively, use them as foreign tax","page_number":165,"box":{"x":69,"y":475,"width":788,"height":12}},{"id":"26f13c74-2523-4e25-be5b-f2afb162c280","block_type":"box","text":"credits against their U.S. income taxes. No deductions for foreign taxes, however, may be claimed by noncorporate","page_number":165,"box":{"x":69,"y":491,"width":818,"height":11}},{"id":"9651f803-3b85-4dde-b64b-1e39070e04d6","block_type":"box","text":"shareholders who do not itemize deductions. A shareholder that is a nonresident alien individual or a foreign","page_number":165,"box":{"x":69,"y":506,"width":773,"height":11}},{"id":"33572f10-8a16-43da-b7d4-46c92055c715","block_type":"box","text":"corporation may be subject to U.S. withholding tax on the income resulting from a Fund’s election described in this","page_number":165,"box":{"x":69,"y":521,"width":817,"height":11}},{"id":"f9e84c69-fe76-4789-bb07-4f1c829ef604","block_type":"box","text":"paragraph but may not be able to claim a credit or deduction against such U.S. tax for the foreign taxes treated as","page_number":165,"box":{"x":70,"y":536,"width":814,"height":11}},{"id":"2b57523c-b6d5-400f-b085-22d1a4dc619f","block_type":"box","text":"having been paid by such shareholder. A Fund will repor t annually to its shareholders the amount per share of such","page_number":165,"box":{"x":69,"y":551,"width":821,"height":11}},{"id":"7ceabfa5-26ae-4237-a245-24b0cc9b308b","block_type":"box","text":"foreign taxes and other information needed to claim the foreign tax credit.","page_number":165,"box":{"x":68,"y":566,"width":527,"height":11}},{"id":"db850e84-2019-4bde-800f-00fb512ffd6a","block_type":"box","text":"Cer tain transactions entered into by the Funds are subject to special tax rules of the Code that may, among","page_number":165,"box":{"x":102,"y":589,"width":768,"height":11}},{"id":"91d579de-fcf2-4db7-915f-ae678d647786","block_type":"box","text":"other things, (a) affect the character of gains and losses realized, (b) disallow, suspend or otherwise limit the","page_number":165,"box":{"x":69,"y":604,"width":780,"height":11}},{"id":"295a0119-f64e-4218-8dc2-1346a4f09c24","block_type":"box","text":"allowance of cer tain losses or deductions, and (c) accelerate the recognition of income without a corresponding","page_number":165,"box":{"x":69,"y":619,"width":797,"height":11}},{"id":"20820adb-3a07-4d6e-bfc5-0c0c637cbcde","block_type":"box","text":"receipt of cash (with which to make the necessary distributions to satisfy distribution requirements applicable to","page_number":165,"box":{"x":69,"y":634,"width":802,"height":11}},{"id":"c5bde0d0-34fe-4748-a663-b5caf3faf057","block_type":"box","text":"regulated investment companies). Operation of these rules could, therefore, affect the character, amount and timing","page_number":165,"box":{"x":69,"y":649,"width":831,"height":12}},{"id":"9891ca6f-6f97-4b89-89de-5417cf68f7ab","block_type":"box","text":"of distributions to shareholders. Special tax rules also may require a Fund to mark-to-market cer tain types of","page_number":165,"box":{"x":69,"y":664,"width":776,"height":12}},{"id":"13eb8909-c069-4911-97ab-a26d3efe5445","block_type":"box","text":"positions in its por tfolio (","page_number":165,"box":{"x":70,"y":680,"width":177,"height":11}},{"id":"4b07d721-470d-4bcb-be45-4bc80d8d5e45","block_type":"box","text":"i.e.","page_number":165,"box":{"x":249,"y":680,"width":20,"height":9}},{"id":"3c936f87-81b3-478a-a8bf-89820732731d","block_type":"box","text":", treat them as sold on the last day of the taxable year), and may result in the recognition","page_number":165,"box":{"x":272,"y":680,"width":636,"height":11}},{"id":"5c301b47-fc22-46f4-9992-3ec1f5c123b5","block_type":"box","text":"of income without a corresponding receipt of cash. Funds engaging in transactions affected by these provisions","page_number":165,"box":{"x":69,"y":695,"width":795,"height":11}},{"id":"85c22afb-4d44-46e7-a1a5-ec38ea70922c","block_type":"box","text":"intend to monitor their transactions, make appropriate tax elections and make appropriate entries in their books and","page_number":165,"box":{"x":70,"y":710,"width":830,"height":11}},{"id":"51411f81-eb30-4df3-bbe4-dad10c75969b","block_type":"box","text":"records to lessen the effect of these tax rules and avoid any possible disqualification from the special treatment","page_number":165,"box":{"x":69,"y":725,"width":804,"height":11}},{"id":"55cebbfc-5893-4819-a9b7-23e36baa4db3","block_type":"box","text":"afforded regulated investment companies under the Code.","page_number":165,"box":{"x":69,"y":740,"width":415,"height":11}},{"id":"6d928850-cf74-494b-a0ce-dcca5e63f9c1","block_type":"box","text":"Cer tain of a Fund’s investments in derivative instruments and foreign currency-denominated instruments, and","page_number":165,"box":{"x":102,"y":763,"width":781,"height":11}},{"id":"9c20b1fd-4a1b-4861-8a76-eb9ef03660b4","block_type":"box","text":"any of the Fund’s transactions in foreign currencies and hedging activities, are likely to produce a difference between","page_number":165,"box":{"x":69,"y":778,"width":835,"height":11}},{"id":"cd7196bb-5db5-44ed-aa6c-365e36e297e6","block_type":"box","text":"its book income and the sum of its taxable income and net tax-exempt income (if any). If such a difference arises,","page_number":165,"box":{"x":70,"y":793,"width":811,"height":11}},{"id":"721933c1-c010-4ed6-a3bb-17218744c12a","block_type":"box","text":"and the Fund’s book income is less than the sum of its taxable income and net tax-exempt income, the Fund could","page_number":165,"box":{"x":69,"y":808,"width":818,"height":11}},{"id":"9acb6db0-a4f8-483d-b12b-dbe32727bbce","block_type":"box","text":"be required to make distributions exceeding book income to qualify as a RIC that is accorded special tax treatment","page_number":165,"box":{"x":69,"y":823,"width":820,"height":12}},{"id":"1869797b-9db3-4767-aec0-e5f34a9cd072","block_type":"box","text":"and to avoid an entity-level tax. In the alternative, if the Fund makes any distribution based on book income and such","page_number":165,"box":{"x":69,"y":838,"width":834,"height":11}},{"id":"860678b4-b310-4ee8-bd08-3602ea3d75ba","block_type":"box","text":"book income exceeds the sum of its taxable income (including realized capital gains) and net tax-exempt income, the","page_number":165,"box":{"x":69,"y":853,"width":833,"height":12}},{"id":"82516909-d25a-4c76-9fc5-b0f515db3215","block_type":"box","text":"distribution (if any) of such excess generally will be treated as (i) a dividend to the extent of the Fund’s remaining","page_number":165,"box":{"x":69,"y":869,"width":805,"height":11}},{"id":"e4b5a70a-8af0-4f50-bc1f-c320a1e97ea0","block_type":"box","text":"II-134","page_number":165,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"c8adcba8-ab45-426b-939f-6b3a476f63ce","block_type":"box","text":"NM1026U-5982568-165/232","page_number":165,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"1cd2acaa-6e56-4a33-9739-f7f3ce321608","block_type":"box","text":"earnings and profits (including earnings and profits arising from tax-exempt income), (ii) thereafter, as a return of","page_number":166,"box":{"x":69,"y":45,"width":805,"height":11}},{"id":"4747af42-242b-48e4-8026-60cde1f6af85","block_type":"box","text":"capital to the extent of the recipient’s basis in its shares, and (iii) thereafter as gain from the sale or exchange of a","page_number":166,"box":{"x":69,"y":60,"width":822,"height":11}},{"id":"e32aeadf-2f72-493a-bce9-4b974ccff90a","block_type":"box","text":"capital asset.","page_number":166,"box":{"x":69,"y":75,"width":95,"height":11}},{"id":"7a94927b-f8d8-4c23-bc44-4bb13d700c69","block_type":"box","text":"If a Fund invests in underlying funds, the Fund’s realized losses on sales of shares of underlying funds may be","page_number":166,"box":{"x":102,"y":98,"width":787,"height":11}},{"id":"e665f003-9f89-4085-99e5-5f4180f66ec4","block_type":"box","text":"indefinitely or permanently deferred as “wash sales.” Distributions of shor t-term capital gains by underlying funds will","page_number":166,"box":{"x":70,"y":113,"width":836,"height":11}},{"id":"929fbcdc-2789-4074-a141-9ef9581a26bf","block_type":"box","text":"be recognized as ordinary income by the Fund and would not be offset by the Fund’s capital loss carryforwards, if","page_number":166,"box":{"x":69,"y":128,"width":812,"height":11}},{"id":"f3014ab7-94b4-46fd-b7ce-63ba5fa71ce2","block_type":"box","text":"any. Capital loss carryforwards of underlying funds, if any, would not offset net capital gains of the Fund. Each of","page_number":166,"box":{"x":69,"y":143,"width":805,"height":11}},{"id":"23117168-c442-4e10-ba84-5e84808b2756","block_type":"box","text":"these effects is caused by the Fund’s expected investment in the underlying funds and may result in distributions to","page_number":166,"box":{"x":68,"y":158,"width":829,"height":11}},{"id":"67138907-bad4-4967-99b5-1cc3bc528d28","block_type":"box","text":"Fund shareholders being of higher magnitudes and less likely to qualify for lower capital gain tax rates than if the","page_number":166,"box":{"x":70,"y":173,"width":803,"height":11}},{"id":"17d47657-bbdb-4193-b5bf-41d3d81e875f","block_type":"box","text":"Fund were to invest otherwise.","page_number":166,"box":{"x":70,"y":188,"width":216,"height":9}},{"id":"f9fb2f59-309f-422c-bc68-b3950c4778d5","block_type":"box","text":"A Fund may take cer tain positions through a wholly-owned (or majority-owned), foreign subsidiary (the","page_number":166,"box":{"x":101,"y":211,"width":721,"height":11}},{"id":"64956af7-23ac-49a5-b281-e15a7e8bf26c","block_type":"box","text":"“Subsidiary”). It is expected that the Subsidiary will be a “controlled foreign corporation” and that all of its net","page_number":166,"box":{"x":70,"y":226,"width":787,"height":11}},{"id":"148e265d-169e-487b-90ff-d86d9ae45ce5","block_type":"box","text":"income will be “subpar t F income” for U.S. federal income tax purposes. If that is the case, the Fund will be required","page_number":166,"box":{"x":70,"y":241,"width":831,"height":11}},{"id":"020f54f6-6b2f-4e06-9294-a17a0e037c54","block_type":"box","text":"to repor t all of the Subsidiary’s net income as ordinary income regardless of whether that income would be treated","page_number":166,"box":{"x":68,"y":256,"width":823,"height":12}},{"id":"1c6d61e0-e8cd-4df1-a0a6-11290bd009f8","block_type":"box","text":"differently (for example, as capital gain) at the Subsidiary level and regardless of whether that income is distributed","page_number":166,"box":{"x":69,"y":271,"width":825,"height":12}},{"id":"4359c901-d4a9-45dd-83a3-c6d0e0e9e0bc","block_type":"box","text":"to the Fund. (Previously taxed income will not, however, be taxable again when distributed.) If a net loss is realized by","page_number":166,"box":{"x":68,"y":286,"width":838,"height":12}},{"id":"7bd329e6-9910-4cf5-ae6f-e01e36fd01fc","block_type":"box","text":"the Subsidiary in any taxable year, the loss will generally not be available to offset the Fund’s other income. It is not","page_number":166,"box":{"x":68,"y":302,"width":830,"height":11}},{"id":"330e193d-ab44-42e4-b935-1e8640db2a28","block_type":"box","text":"expected that the Subsidiary will be subject to an entity-level federal tax.","page_number":166,"box":{"x":69,"y":317,"width":515,"height":11}},{"id":"9abc1c31-4ee1-4b2f-a946-76e190fa1fa0","block_type":"box","text":"If a Fund purchases shares of an investment company (or similar investment entity) organized under foreign law,","page_number":166,"box":{"x":102,"y":339,"width":798,"height":12}},{"id":"496428e3-be08-4034-bcfc-5af4aac42b4e","block_type":"box","text":"the Fund will generally be treated as owning shares in a passive foreign investment company (“PFIC”) for U.S. federal","page_number":166,"box":{"x":68,"y":355,"width":835,"height":11}},{"id":"cec89c8c-7a0f-4b3a-a76f-9e57b97f4708","block_type":"box","text":"income tax purposes. A Fund may be subject to U.S. federal income tax, and interest charges (at the rate applicable","page_number":166,"box":{"x":70,"y":370,"width":827,"height":11}},{"id":"5c328d92-f292-426f-a511-bee6cdf6b57f","block_type":"box","text":"to tax underpayments) on tax liability treated as having been deferred with respect to cer tain distributions from such","page_number":166,"box":{"x":68,"y":385,"width":830,"height":11}},{"id":"8a31ba5f-cc83-4599-be48-674d49d61e12","block_type":"box","text":"a company and on gain from the disposition of the shares of such a company (collectively referred to as “excess","page_number":166,"box":{"x":69,"y":400,"width":802,"height":11}},{"id":"24c27be8-d109-4969-b34b-4e9ae9e7d503","block_type":"box","text":"distributions”), even if such excess distributions are paid by the Fund as a dividend to its shareholders. However, a","page_number":166,"box":{"x":69,"y":415,"width":821,"height":11}},{"id":"96915573-5049-4b34-a879-c71f77167747","block_type":"box","text":"Fund may elect to “mark-to-market” at the end of each taxable year shares that it holds in PFICs. The election is","page_number":166,"box":{"x":70,"y":430,"width":797,"height":11}},{"id":"95f9f65e-b0f6-44e1-87f8-a97dd4452228","block_type":"box","text":"made separately for each PFIC held and, once made, would be effective for all subsequent taxable years, unless","page_number":166,"box":{"x":69,"y":445,"width":801,"height":11}},{"id":"1a714daf-c08d-43f7-85c3-518f4aac4eda","block_type":"box","text":"revoked with consent from the IRS. Under this election, a Fund would recognize as ordinary income any increase in","page_number":166,"box":{"x":69,"y":460,"width":818,"height":12}},{"id":"5a64eb0f-0b26-4e4d-9ef5-c61cbd4fcb79","block_type":"box","text":"the value of its shares as of the close of the taxable year over their adjusted tax basis and as ordinary loss any","page_number":166,"box":{"x":68,"y":475,"width":797,"height":12}},{"id":"c0b5257c-69c8-4f50-b0b8-7d99e79cb642","block_type":"box","text":"decrease in such value, but only to the extent of previously recognized “mark-to-market” gains. By making the mark","page_number":166,"box":{"x":69,"y":491,"width":824,"height":11}},{"id":"cb56c755-610d-4d70-b80d-155faa4d4863","block_type":"box","text":"to-market election, a Fund could avoid imposition of the interest charge with respect to excess distributions from","page_number":166,"box":{"x":68,"y":506,"width":804,"height":11}},{"id":"0aeea12d-5d02-40c9-869b-28530ba8edf0","block_type":"box","text":"PFICs, but in any par ticular year might be required to recognize income in excess of the distributions it received from","page_number":166,"box":{"x":69,"y":521,"width":831,"height":11}},{"id":"377d1508-3f03-4db2-8dd1-8cf8416595fd","block_type":"box","text":"PFICs.","page_number":166,"box":{"x":69,"y":536,"width":42,"height":9}},{"id":"84d78193-397d-4073-802d-9d22108d44e6","block_type":"box","text":"If a Fund were to invest in a PFIC and elect to treat the PFIC as a “qualified electing fund” under the Code, in lieu","page_number":166,"box":{"x":102,"y":559,"width":804,"height":11}},{"id":"cdd58c5e-6e19-4870-b335-cdcbbbb7d26b","block_type":"box","text":"of the foregoing requirements, the Fund would be required to include in income each year a por tion of the ordinary","page_number":166,"box":{"x":69,"y":574,"width":816,"height":11}},{"id":"017d53f1-4c07-47fd-8ac1-cef108d039dd","block_type":"box","text":"earnings and net capital gains of the qualified electing fund, even if not distributed to the Fund, and such amounts","page_number":166,"box":{"x":69,"y":589,"width":816,"height":11}},{"id":"937babb5-8ef2-4a6a-b5ce-3aab84976af3","block_type":"box","text":"would be subject to the 90% and excise tax distribution requirements described above. In order to make this election,","page_number":166,"box":{"x":68,"y":604,"width":840,"height":11}},{"id":"540291b9-0143-4e5f-8595-65114b0aee8d","block_type":"box","text":"the Fund would be required to obtain cer tain annual information from the PFICs in which it invests, which may be","page_number":166,"box":{"x":68,"y":619,"width":804,"height":11}},{"id":"830f487a-a1fa-4647-a00a-f6349837e106","block_type":"box","text":"difficult or impossible to obtain.","page_number":166,"box":{"x":69,"y":634,"width":225,"height":11}},{"id":"a9e265e8-847c-4ebb-857a-df90be109cc2","block_type":"box","text":"In cer tain situations, a Fund may, for a taxable year, defer all or a por tion of its net capital loss (or if there is no","page_number":166,"box":{"x":102,"y":657,"width":796,"height":11}},{"id":"00cbbcc6-b20a-4c87-82d9-0a8d4c693a14","block_type":"box","text":"net capital loss, any net long-term or shor t-term capital loss) realized after October and its late-year ordinary loss","page_number":166,"box":{"x":69,"y":672,"width":806,"height":11}},{"id":"73ddd824-bef4-4c10-b83a-65d6ea2e566c","block_type":"box","text":"(defined as the sum of the excess of post-October foreign currency and PFIC losses over post-October foreign","page_number":166,"box":{"x":69,"y":687,"width":778,"height":11}},{"id":"6baf0b7e-7f7e-4e84-901f-98613ef0d78e","block_type":"box","text":"currency and PFIC gains plus the excess of post-December ordinary losses over post-December ordinary income) until","page_number":166,"box":{"x":69,"y":702,"width":838,"height":12}},{"id":"8f1bec3b-3571-487c-a613-f826754320d0","block_type":"box","text":"the next taxable year in computing its investment company taxable income and net capital gain, which will defer the","page_number":166,"box":{"x":68,"y":717,"width":824,"height":12}},{"id":"aea18682-4aae-4e79-b524-6bbd93a984a5","block_type":"box","text":"recognition of such realized losses. Such deferrals and other rules regarding gains and losses realized after October","page_number":166,"box":{"x":69,"y":732,"width":830,"height":12}},{"id":"01c1375f-ce40-465e-92b5-f7d3f691a7a5","block_type":"box","text":"(or December) may affect the tax character of shareholder distributions.","page_number":166,"box":{"x":69,"y":748,"width":511,"height":11}},{"id":"7c4dedfd-5d97-4de4-97b5-9206e520ca17","block_type":"box","text":"Municipal Funds","page_number":166,"box":{"x":102,"y":771,"width":115,"height":10}},{"id":"48bbc271-adf2-44be-a119-4c26f4b4330b","block_type":"box","text":"Each Municipal Fund intends to qualify to pay “exempt-interest dividends” as defined in Section 852(b)(5) of the","page_number":166,"box":{"x":102,"y":793,"width":798,"height":11}},{"id":"acc8028f-d743-4a40-bbd4-d4ce7ed769af","block_type":"box","text":"Code. Under such section if, at the close of each quar ter of a Fund’s taxable year, at least 50% of the value of the","page_number":166,"box":{"x":69,"y":808,"width":815,"height":11}},{"id":"1153bc32-cfb5-49fc-8f4f-60c005237fdf","block_type":"box","text":"Fund’s total assets consists of obligations exempt from U.S. federal income tax (“tax-exempt obligations”) under","page_number":166,"box":{"x":70,"y":823,"width":803,"height":12}},{"id":"b81ce119-be17-4f89-8795-2798bbbf95b2","block_type":"box","text":"Section 103(a) of the Code (relating generally to obligations of a state or local governmental unit), the Fund shall be","page_number":166,"box":{"x":69,"y":838,"width":826,"height":12}},{"id":"3f082b4e-f936-4582-837c-bae752d93175","block_type":"box","text":"qualified to pay exempt-interest dividends to holders of all outstanding classes of its shares (together the","page_number":166,"box":{"x":69,"y":853,"width":752,"height":12}},{"id":"6a89e338-0cd9-45d9-8dcd-055432da3aee","block_type":"box","text":"“shareholders”). Exempt-interest dividends are dividends or any par t thereof paid by a Fund that are attributable to","page_number":166,"box":{"x":70,"y":869,"width":817,"height":11}},{"id":"8cfc7da6-82e8-47c5-a863-269c6e57f5d8","block_type":"box","text":"interest on tax-exempt obligations and repor ted by the Fund as exempt-interest dividends. A Fund will allocate","page_number":166,"box":{"x":70,"y":884,"width":780,"height":11}},{"id":"137beb41-66d7-449b-80d8-2882a7ad5da4","block_type":"box","text":"interest from tax-exempt obligations (as well as ordinary income, capital gains and tax preference items discussed","page_number":166,"box":{"x":70,"y":899,"width":815,"height":11}},{"id":"1949200d-daf5-40e8-b887-cd45379bbce8","block_type":"box","text":"II-135","page_number":166,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"92690d24-d0d0-470c-8c03-5c05da3d23f3","block_type":"box","text":"NM1026U-5982568-166/232","page_number":166,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"356e9ebd-ea5f-4196-8bf7-6937e3a450fd","block_type":"box","text":"below) among the Fund’s shareholders according to a method (that it believes is consistent with the Commission rule","page_number":167,"box":{"x":69,"y":45,"width":839,"height":11}},{"id":"aa7b069f-e67f-47c5-9b9f-e0886c2d478f","block_type":"box","text":"permitting the issuance and sale of multiple classes of shares) that is based upon the gross income that is allocable","page_number":167,"box":{"x":70,"y":60,"width":835,"height":11}},{"id":"9405b3f0-85b3-4c24-b610-e44d07c08ea6","block_type":"box","text":"to each class of shareholders during the taxable year, or such other method as the IRS may prescribe.","page_number":167,"box":{"x":68,"y":75,"width":730,"height":11}},{"id":"b00cb96c-45c0-4680-991d-2d4e63ff34e5","block_type":"box","text":"Exempt-interest dividends will be excludable from a shareholder’s gross income for U.S. federal income tax","page_number":167,"box":{"x":102,"y":98,"width":763,"height":11}},{"id":"c019ffb0-5ed5-4da8-b8d2-5a1aee6743b8","block_type":"box","text":"purposes. Exempt-interest dividends are included, however, in determining the por tion, if any, of a person’s social","page_number":167,"box":{"x":70,"y":113,"width":809,"height":11}},{"id":"2cdca774-cbc8-4d27-8263-f5db0d61d42d","block_type":"box","text":"security and railroad retirement benefits subject to U.S. federal income taxes. Interest on indebtedness incurred or","page_number":167,"box":{"x":69,"y":128,"width":821,"height":11}},{"id":"f15a263f-ddd1-437a-b160-a1047d2f7daa","block_type":"box","text":"continued to purchase or carry shares of a regulated investment company paying exempt-interest dividends, such as","page_number":167,"box":{"x":69,"y":143,"width":831,"height":11}},{"id":"45d04568-ea20-46f3-a59f-1a5404c20434","block_type":"box","text":"the Fund, will not be deductible by the investor for U.S. federal income tax purposes to the extent attributable to","page_number":167,"box":{"x":68,"y":158,"width":800,"height":11}},{"id":"6bfcc6d3-f4e1-4fce-b982-469c18fc7fb9","block_type":"box","text":"exempt-interest dividends. Shareholders are advised to consult their tax advisors with respect to whether exempt","page_number":167,"box":{"x":69,"y":173,"width":810,"height":11}},{"id":"955dda24-57a0-4966-8ec7-0d3c2866f5c5","block_type":"box","text":"interest dividends retain the exclusion under Code Section 103(a) if a shareholder would be treated as a “substantial","page_number":167,"box":{"x":70,"y":188,"width":836,"height":11}},{"id":"f5926baf-3795-4b6b-9a85-c5f04bf2218a","block_type":"box","text":"user” or “related person” under Code Section 147(a) with respect to proper ty financed with the proceeds of an issue","page_number":167,"box":{"x":69,"y":203,"width":835,"height":12}},{"id":"eeb1fe62-ed55-4a8e-ae2a-9e90e8d7e34d","block_type":"box","text":"of PABs, if any, held by a Fund.","page_number":167,"box":{"x":69,"y":218,"width":217,"height":12}},{"id":"629a00fa-d5dc-4a9f-b1b2-d2df8d5a7cfb","block_type":"box","text":"Substitute payments received by a Fund representing interest paid on tax-exempt obligations loaned out by the","page_number":167,"box":{"x":102,"y":241,"width":788,"height":11}},{"id":"30cab05c-086e-4b79-8c4f-e4ef0edef493","block_type":"box","text":"Fund will not be considered exempt interest, and distributions by the Fund of such substitute payments will not","page_number":167,"box":{"x":70,"y":256,"width":790,"height":11}},{"id":"18b63885-b27f-4b00-a1b4-3eeff0740258","block_type":"box","text":"constitute exempt-interest dividends.","page_number":167,"box":{"x":69,"y":272,"width":261,"height":10}},{"id":"3655ac75-c93a-48eb-b9c7-deb555bdb455","block_type":"box","text":"Distributions in excess of a Fund’s earnings and profits will first reduce the adjusted tax basis of a holder’s","page_number":167,"box":{"x":102,"y":294,"width":765,"height":11}},{"id":"c08cf750-46c7-4670-94f2-b8566fb1df68","block_type":"box","text":"shares and, after such adjusted tax basis is reduced to zero, will constitute capital gains to such holder (assuming","page_number":167,"box":{"x":69,"y":309,"width":819,"height":11}},{"id":"b0ee7b65-fabd-4676-b01e-53824c18ff2a","block_type":"box","text":"the shares are held as a capital asset). Any loss upon the sale or exchange of Fund shares held for six months or","page_number":167,"box":{"x":68,"y":324,"width":813,"height":12}},{"id":"4afa7969-3224-4cf0-9a1f-77e4f60e6a9e","block_type":"box","text":"less will be disallowed to the extent of any exempt-interest dividends received by the shareholder. In addition, any","page_number":167,"box":{"x":70,"y":339,"width":809,"height":12}},{"id":"34096b5c-60be-40e9-89c0-2765a5f373e2","block_type":"box","text":"such loss that is not disallowed under the rule stated above will be treated as long-term capital loss to the extent of","page_number":167,"box":{"x":69,"y":355,"width":829,"height":11}},{"id":"47f820bf-a633-4f58-bb59-ba25e4d056f9","block_type":"box","text":"any capital gain dividends received by the shareholder.","page_number":167,"box":{"x":69,"y":370,"width":388,"height":11}},{"id":"75751067-2333-4cb1-824c-8669f52a7daf","block_type":"box","text":"All or a por tion of a Fund’s gains from the sale or redemption of tax-exempt obligations purchased at a market","page_number":167,"box":{"x":101,"y":392,"width":787,"height":12}},{"id":"f4982df9-b92b-4f3f-b1d0-8ea4a42d0061","block_type":"box","text":"discount will be treated as ordinary income rather than capital gain. This rule may increase the amount of ordinary","page_number":167,"box":{"x":69,"y":407,"width":817,"height":12}},{"id":"67ae75ae-c441-47f3-909e-7c53f7a2b13c","block_type":"box","text":"income dividends received by shareholders.","page_number":167,"box":{"x":70,"y":423,"width":309,"height":11}},{"id":"df878af7-d607-4005-99c6-a14dc7b57e95","block_type":"box","text":"Any market discount recognized on a bond is taxable as ordinary income. A market discount bond is a bond","page_number":167,"box":{"x":101,"y":446,"width":766,"height":11}},{"id":"4156991b-ce37-4271-b4f1-c8642d0e4916","block_type":"box","text":"acquired in the secondary market at a price below redemption value or adjusted issue price if issued with original","page_number":167,"box":{"x":69,"y":460,"width":808,"height":12}},{"id":"42b06755-02e1-4317-b309-904b9afbefa7","block_type":"box","text":"issue discount. Absent an election by the Fund to include the market discount in income as it accrues, gain on the","page_number":167,"box":{"x":70,"y":476,"width":815,"height":11}},{"id":"bd51ac4a-a885-4dc7-8759-2cf4b89b4dc6","block_type":"box","text":"Fund’s disposition of such an obligation will be treated as ordinary income rather than capital gain to the extent of","page_number":167,"box":{"x":70,"y":491,"width":815,"height":11}},{"id":"2f263930-d293-42fa-b777-4ca4b3b0736b","block_type":"box","text":"the accrued market discount.","page_number":167,"box":{"x":68,"y":506,"width":208,"height":9}},{"id":"bc6dd723-f6ac-41aa-9fa6-a8fa9caccd69","block_type":"box","text":"The Code subjects interest received on cer tain otherwise tax-exempt securities to a federal alternative minimum","page_number":167,"box":{"x":101,"y":528,"width":801,"height":12}},{"id":"569db388-c578-44d7-beab-63895709b5a1","block_type":"box","text":"tax. The alternative minimum tax applies to interest received on cer tain “PABs” issued after August 7, 1986. PABs","page_number":167,"box":{"x":68,"y":543,"width":818,"height":12}},{"id":"3d60908d-4cf2-4b25-8025-bcaa184a2e5f","block_type":"box","text":"are bonds that, although tax-exempt, are used for purposes other than those generally per formed by governmental","page_number":167,"box":{"x":69,"y":559,"width":816,"height":11}},{"id":"6c78458a-f73b-4775-b517-e82c3a42d9b2","block_type":"box","text":"units and that benefit non-governmental entities (","page_number":167,"box":{"x":69,"y":574,"width":351,"height":11}},{"id":"8f638abc-0a64-4df2-bafe-c210f4e0aaf8","block_type":"box","text":"e.g.","page_number":167,"box":{"x":422,"y":575,"width":24,"height":10}},{"id":"89b9728a-b142-4947-8ae3-be3a423a191c","block_type":"box","text":", bonds used for industrial development or housing purposes).","page_number":167,"box":{"x":449,"y":574,"width":441,"height":11}},{"id":"a39b31f5-8e8e-4690-99b3-2011ab16dc0b","block_type":"box","text":"Income received on such bonds is classified as an item of “tax preference,” which could subject cer tain investors in","page_number":167,"box":{"x":70,"y":589,"width":827,"height":11}},{"id":"e6f5ef31-a79d-4957-9020-f4f741ca6529","block_type":"box","text":"such bonds, including shareholders of a Fund, to a federal alternative minimum tax. A Fund will purchase such","page_number":167,"box":{"x":69,"y":604,"width":786,"height":11}},{"id":"55a568c5-54fb-4548-9f53-202f8a96f30e","block_type":"box","text":"“PABs” and will repor t to shareholders after the close of the calendar year the por tion of the Fund’s dividends","page_number":167,"box":{"x":70,"y":619,"width":782,"height":11}},{"id":"835e5096-e723-42c5-be52-42cda5964f0e","block_type":"box","text":"declared during the year that constitute an item of tax preference for alternative minimum tax purposes.","page_number":167,"box":{"x":69,"y":634,"width":740,"height":12}},{"id":"198e3012-e7a6-4d2f-b300-207850315672","block_type":"box","text":"Each Municipal Fund may engage in interest rate swap transactions. The U.S. federal income tax rules governing","page_number":167,"box":{"x":102,"y":657,"width":802,"height":11}},{"id":"36ac6766-d503-45dd-89ff-3970f2c16912","block_type":"box","text":"the taxation of interest rate swaps are not entirely clear and may require a Fund to treat payments received under","page_number":167,"box":{"x":68,"y":672,"width":812,"height":11}},{"id":"894d61e0-ca1e-4235-8155-2f7adbccac8f","block_type":"box","text":"such arrangements as ordinary income and to amor tize payments made under cer tain circumstances. Because","page_number":167,"box":{"x":69,"y":687,"width":794,"height":11}},{"id":"beb65d07-d40e-40aa-96a4-aa7bebfa22e5","block_type":"box","text":"payments received by a Fund in connection with swap transactions will be taxable rather than tax-exempt and","page_number":167,"box":{"x":70,"y":703,"width":776,"height":10}},{"id":"76bc251a-134d-4d68-8d88-405222ba9630","block_type":"box","text":"because swap payments made by a Fund will offset both taxable and tax-exempt gross income propor tionately, they","page_number":167,"box":{"x":69,"y":717,"width":826,"height":12}},{"id":"4ce039f5-a15d-45d5-a243-6033431b81ba","block_type":"box","text":"may result in increased taxable distributions to shareholders.","page_number":167,"box":{"x":69,"y":733,"width":436,"height":11}},{"id":"4fb47dc8-a65c-4490-ad2a-2eff13545abb","block_type":"box","text":"Please see Par t I of your Fund’s SAI for cer tain state tax information relevant to an investment in BlackRock","page_number":167,"box":{"x":102,"y":755,"width":771,"height":11}},{"id":"7ecd0386-6964-449f-b566-b0fbae835445","block_type":"box","text":"California Municipal Oppor tunities Fund, BlackRock New Jersey Municipal Bond Fund, BlackRock New York Municipal","page_number":167,"box":{"x":69,"y":770,"width":828,"height":11}},{"id":"ef8b94f6-ce7e-45b1-a244-433da873ea7a","block_type":"box","text":"Oppor tunities Fund and BlackRock Pennsylvania Municipal Bond Fund, as well as information on economic conditions","page_number":167,"box":{"x":69,"y":785,"width":836,"height":12}},{"id":"d9ba063b-eaf7-40ca-a0d9-fc6dfb0fffa1","block_type":"box","text":"within each applicable state.","page_number":167,"box":{"x":68,"y":801,"width":203,"height":11}},{"id":"e8abaf0a-2b05-4b68-b7c4-bc977f7330a3","block_type":"box","text":"In the case of a Feeder Fund, such Fund is entitled to look to the underlying assets of the Master Por tfolio in","page_number":167,"box":{"x":102,"y":823,"width":774,"height":12}},{"id":"fd8a0bbd-f9df-4683-bdc2-037ee90ec9b0","block_type":"box","text":"which it has invested for purposes of satisfying various qualification requirements of the Code applicable to regulated","page_number":167,"box":{"x":68,"y":838,"width":837,"height":12}},{"id":"9cc08180-4689-4a0b-af94-f00b0ec3f4f7","block_type":"box","text":"investment companies. Each Master Por tfolio is classified either as a par tnership or a separate disregarded entity","page_number":167,"box":{"x":70,"y":853,"width":816,"height":12}},{"id":"38cb2bf3-404b-45af-b9c1-405fbe6c26f4","block_type":"box","text":"(depending on the par ticular Master Por tfolio) for U.S. federal income tax purposes. If applicable tax provisions were","page_number":167,"box":{"x":69,"y":869,"width":830,"height":11}},{"id":"c3d2520e-0997-475c-a50d-697ae78ad46b","block_type":"box","text":"to change the classification of a Master Por tfolio, then the Board of Directors of a Feeder Fund would determine, in","page_number":167,"box":{"x":68,"y":884,"width":822,"height":11}},{"id":"dc3e35c8-aa44-443f-a876-e2429c1e18fc","block_type":"box","text":"its discretion, the appropriate course of action for the Feeder Fund. One possible course of action would be to","page_number":167,"box":{"x":70,"y":899,"width":783,"height":11}},{"id":"be6b8f72-310a-4af8-a4bf-0a648c0254af","block_type":"box","text":"II-136","page_number":167,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"5aa5efba-4eb9-4a02-98a5-6875326fad3a","block_type":"box","text":"NM1026U-5982568-167/232","page_number":167,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"2bba6679-2991-489e-9748-74edb9515e13","block_type":"box","text":"withdraw the Feeder Fund’s investments from the Master Por tfolio and to retain an investment manager to manage","page_number":168,"box":{"x":68,"y":45,"width":822,"height":11}},{"id":"d3b3c2f8-1364-447a-a709-a0996269dad4","block_type":"box","text":"the Feeder Fund’s assets in accordance with the investment policies applicable to the Feeder Fund.","page_number":168,"box":{"x":68,"y":60,"width":710,"height":11}},{"id":"b59ea68b-722f-4f47-b2d0-e3aa8fc7d870","block_type":"box","text":"Ordinary income and capital gain dividends may also be subject to state and local taxes. Cer tain states exempt","page_number":168,"box":{"x":102,"y":83,"width":796,"height":11}},{"id":"68ba136c-21a6-4183-bf57-cb71fe7850c6","block_type":"box","text":"from state income taxation dividends paid by regulated investment companies that are derived from interest on U.S.","page_number":168,"box":{"x":68,"y":98,"width":828,"height":11}},{"id":"9ad9ca72-b0b8-4bbf-8a60-7e564940e485","block_type":"box","text":"government obligations. State law varies as to whether dividend income attributable to U.S. government obligations is","page_number":168,"box":{"x":68,"y":113,"width":841,"height":11}},{"id":"b0973544-e528-40b6-9aba-6c57ffc1e3d0","block_type":"box","text":"exempt from state income tax.","page_number":168,"box":{"x":69,"y":128,"width":216,"height":11}},{"id":"6dcff84b-99c6-435d-94ee-6d84cc4cd505","block_type":"box","text":"Shareholders of each Fund are urged to consult their tax advisers regarding specific questions as to federal,","page_number":168,"box":{"x":102,"y":150,"width":771,"height":12}},{"id":"62dc5ce7-d334-49d1-8146-fae20c4d99bd","block_type":"box","text":"foreign, state or local taxes with respect to their Fund. Foreign investors should consider applicable foreign taxes in","page_number":168,"box":{"x":68,"y":166,"width":823,"height":11}},{"id":"f694bb58-5e08-45d6-a06d-5c1f1154127d","block_type":"box","text":"their evaluation of an investment in a Fund.","page_number":168,"box":{"x":68,"y":181,"width":309,"height":9}},{"id":"2dc13954-f1b6-459e-a50b-c853ba36a48b","block_type":"box","text":"The foregoing general discussion of U.S. federal income tax consequences is based on the Code and the","page_number":168,"box":{"x":101,"y":203,"width":749,"height":12}},{"id":"6236f36a-3efd-4625-8b0f-2ad17c7b8202","block_type":"box","text":"regulations issued thereunder as in effect on the date of this SAI. Future legislative or administrative changes or","page_number":168,"box":{"x":69,"y":218,"width":803,"height":12}},{"id":"4c0ab6d8-716c-441f-86b1-0c9271c92268","block_type":"box","text":"cour t decisions may significantly change the conclusions expressed in this discussion, and any such changes or","page_number":168,"box":{"x":69,"y":234,"width":801,"height":11}},{"id":"8cdf7a64-62d7-4c1e-a73b-418a2849dfdc","block_type":"box","text":"decisions may have a retroactive effect.","page_number":168,"box":{"x":69,"y":249,"width":283,"height":11}},{"id":"7ee7f1dd-56e3-4e80-bb6f-4430552b5bec","block_type":"box","text":"PERFORMANCE DATA","page_number":168,"box":{"x":403,"y":278,"width":173,"height":10}},{"id":"951051c4-8438-4a12-ad7e-f452ce172ad8","block_type":"box","text":"From time to time a Fund may include its average annual total return and other total return data, and, if","page_number":168,"box":{"x":102,"y":301,"width":738,"height":11}},{"id":"6b399477-09c7-4688-8d4e-ace2e86c931c","block_type":"box","text":"applicable, yield and tax-equivalent yield in adver tisements or information furnished to present or prospective","page_number":168,"box":{"x":69,"y":316,"width":779,"height":11}},{"id":"e7393344-4447-479b-919f-69c3700662b7","block_type":"box","text":"shareholders. Total return, yield and tax-equivalent yield each is based on a Fund’s historical per formance and is not","page_number":168,"box":{"x":69,"y":331,"width":833,"height":11}},{"id":"285aa7c6-4960-46d5-9bc7-adcc9b806956","block_type":"box","text":"intended to indicate future per formance. Average annual total return is determined separately for each class of","page_number":168,"box":{"x":70,"y":346,"width":792,"height":12}},{"id":"e0ef0e37-d0da-4873-9b2d-3ee4797ce4a3","block_type":"box","text":"shares in accordance with a formula specified by the Commission.","page_number":168,"box":{"x":69,"y":361,"width":473,"height":12}},{"id":"b0e18914-30bb-4c29-96e7-732a9e8cf3fa","block_type":"box","text":"Quotations of average annual total return, before tax, for the specified periods are computed by finding the","page_number":168,"box":{"x":102,"y":384,"width":761,"height":11}},{"id":"2a4aef65-d989-4120-8c29-6b9cb595d88b","block_type":"box","text":"average annual compounded rates of return (based on net investment income and any realized and unrealized capital","page_number":168,"box":{"x":69,"y":399,"width":836,"height":12}},{"id":"7c854a21-be85-4410-9a39-e8c1dc5a2873","block_type":"box","text":"gains or losses on por tfolio investments over such periods) that would equate the initial amount invested to the","page_number":168,"box":{"x":68,"y":414,"width":798,"height":12}},{"id":"d687edf9-82ec-4b70-b0ad-295f21dc2051","block_type":"box","text":"redeemable value of such investment at the end of each period. Average annual total return before taxes is","page_number":168,"box":{"x":69,"y":429,"width":765,"height":12}},{"id":"049e8fd7-13ac-4bb2-8a0e-098ae4ea876e","block_type":"box","text":"computed assuming all dividends are reinvested and taking into account all applicable recurring and nonrecurring","page_number":168,"box":{"x":69,"y":445,"width":808,"height":11}},{"id":"c3f3236d-ee60-42b0-8b31-672114aa4117","block_type":"box","text":"expenses, including the maximum sales charge, in the case of front-end load shares, and the CDSC that would be","page_number":168,"box":{"x":69,"y":460,"width":813,"height":11}},{"id":"a7d9bf31-cca2-4daf-8fa7-fff02d724e87","block_type":"box","text":"applicable to a complete redemption of the investment at the end of the specified period in the case of CDSC shares,","page_number":168,"box":{"x":69,"y":475,"width":839,"height":11}},{"id":"089a55de-093a-424e-ac80-9c2c67ea9dcb","block_type":"box","text":"but does not take into account taxes payable on dividends or on redemption.","page_number":168,"box":{"x":69,"y":490,"width":546,"height":11}},{"id":"9bf0782b-4382-4bad-b3de-b0d4948910d4","block_type":"box","text":"Quotations of average annual total return, after taxes, on dividends for the specified periods are computed by","page_number":168,"box":{"x":102,"y":513,"width":781,"height":11}},{"id":"c56ba041-2361-4364-9c14-f4a73a3452ef","block_type":"box","text":"finding the average annual compounded rates of return that would equate the initial amount invested to the ending","page_number":168,"box":{"x":68,"y":528,"width":819,"height":11}},{"id":"f9a8ebba-76ee-417a-ac0a-d8021ea46518","block_type":"box","text":"value of such investment at the end of each period assuming payment of taxes on dividends received during such","page_number":168,"box":{"x":68,"y":543,"width":810,"height":11}},{"id":"59c36d71-6823-4bdb-b3a0-86e94485a34a","block_type":"box","text":"period. Average annual total return after taxes on dividends is computed assuming all dividends, less the taxes due","page_number":168,"box":{"x":70,"y":558,"width":823,"height":11}},{"id":"749ff5b0-0a43-4654-a3dc-4ba3f50c075d","block_type":"box","text":"on such dividends, are reinvested and taking into account all applicable recurring and nonrecurring expenses,","page_number":168,"box":{"x":69,"y":573,"width":780,"height":11}},{"id":"7789ee77-f7b2-4414-b93d-1b116a4f48a3","block_type":"box","text":"including the maximum sales charge, in the case of front-end load shares and the CDSC that would be applicable to","page_number":168,"box":{"x":70,"y":588,"width":825,"height":12}},{"id":"9c695706-5d37-469a-b7fb-9b04777ea58e","block_type":"box","text":"a complete redemption of the investment at the end of the specified period in the case of CDSC shares. The taxes","page_number":168,"box":{"x":69,"y":603,"width":817,"height":11}},{"id":"f7b7cf7c-c621-4144-970c-701a3d8e099a","block_type":"box","text":"due on dividends are calculated by applying to each dividend the highest applicable marginal U.S. federal individual","page_number":168,"box":{"x":69,"y":618,"width":820,"height":12}},{"id":"cf476231-bb54-46e6-b164-3a5b215da8bd","block_type":"box","text":"income tax rates in effect on the reinvestment date for that dividend. The rates used correspond to the tax character","page_number":168,"box":{"x":70,"y":634,"width":833,"height":11}},{"id":"3adcb51d-b2c3-4608-be50-75b44b70ba5c","block_type":"box","text":"(including eligibility for the maximum 20% tax rate applicable to qualified dividend income) of each dividend. The","page_number":168,"box":{"x":69,"y":649,"width":797,"height":11}},{"id":"0a23c652-701a-423a-93b8-9ce7638c0896","block_type":"box","text":"taxable amount and tax character of each dividend are specified by each Fund on the dividend declaration date, but","page_number":168,"box":{"x":68,"y":664,"width":824,"height":11}},{"id":"a720840b-d549-40fc-94d8-8dcac671f63b","block_type":"box","text":"may be adjusted to reflect subsequent recharacterizations of distributions. The applicable tax rates may vary over the","page_number":168,"box":{"x":69,"y":679,"width":837,"height":11}},{"id":"43013d24-1009-4038-8e12-b5fdccea81b4","block_type":"box","text":"measurement period. The effects of state and local taxes are not reflected. Applicable tax credits, such as foreign","page_number":168,"box":{"x":69,"y":694,"width":814,"height":11}},{"id":"d253e7a8-34bc-4244-b1ef-9a1d2e7faf03","block_type":"box","text":"credits, are taken into account according to U.S. federal tax law. The ending value is determined assuming complete","page_number":168,"box":{"x":69,"y":709,"width":830,"height":11}},{"id":"7b497cd9-1593-463e-9296-99018815ecd2","block_type":"box","text":"redemption at the end of the applicable periods with no tax consequences associated with such redemption.","page_number":168,"box":{"x":69,"y":724,"width":774,"height":11}},{"id":"2e445229-1b34-4153-a638-a63779dc00b3","block_type":"box","text":"Quotations of average annual total return, after taxes, on both dividends and redemption for the specified","page_number":168,"box":{"x":102,"y":747,"width":752,"height":11}},{"id":"dd2d6026-4ef7-488f-85c5-4d30488bcdaf","block_type":"box","text":"periods are computed by finding the average annual compounded rates of return that would equate the initial amount","page_number":168,"box":{"x":70,"y":762,"width":835,"height":11}},{"id":"1f505e88-0f3f-4f69-82cb-cf298acea10b","block_type":"box","text":"invested to the ending value of such investment at the end of each period assuming payment of taxes on dividends","page_number":168,"box":{"x":70,"y":777,"width":820,"height":12}},{"id":"b84a2f43-a47e-4f79-88d7-83e6bdbcb70e","block_type":"box","text":"received during such period as well as on complete redemption. Average annual total return after taxes on","page_number":168,"box":{"x":69,"y":792,"width":756,"height":12}},{"id":"13abefdf-50ce-4aee-8043-7c4feef1bb8d","block_type":"box","text":"distributions and redemption is computed assuming all dividends, less the taxes due on such dividends, are","page_number":168,"box":{"x":69,"y":808,"width":772,"height":11}},{"id":"c7662901-d3e4-4ab8-b4ed-2e22f6cf47b2","block_type":"box","text":"reinvested and taking into account all applicable recurring and nonrecurring expenses, including the maximum sales","page_number":168,"box":{"x":69,"y":823,"width":827,"height":11}},{"id":"a1acda8b-16f8-4d10-a101-4a156df82e2b","block_type":"box","text":"charge in the case of front-end load shares and the CDSC that would be applicable to a complete redemption of the","page_number":168,"box":{"x":69,"y":838,"width":825,"height":11}},{"id":"d3422a3c-840d-486c-922d-8b1a24748274","block_type":"box","text":"investment at the end of the specified period in the case of CDSC shares and assuming, for all classes of shares,","page_number":168,"box":{"x":70,"y":853,"width":812,"height":11}},{"id":"c8af263b-8e44-4225-84cd-c04f110296e1","block_type":"box","text":"complete redemption and payment of taxes due on such redemption. The ending value is determined assuming","page_number":168,"box":{"x":69,"y":868,"width":795,"height":11}},{"id":"fc1cd455-3bcd-4233-ac11-e207c7ba2d18","block_type":"box","text":"complete redemption at the end of the applicable periods, subtracting capital gains taxes resulting from the","page_number":168,"box":{"x":69,"y":883,"width":768,"height":11}},{"id":"d79fb9e3-d3cc-409a-8cef-7d75072b9d53","block_type":"box","text":"redemption and adding the presumed tax benefit from capital losses resulting from redemption. The taxes due on","page_number":168,"box":{"x":69,"y":898,"width":810,"height":11}},{"id":"1c736fef-ab99-40f9-8b0e-5c64f800d0a2","block_type":"box","text":"II-137","page_number":168,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"bb1a7d16-8903-4291-8195-9d92a1762214","block_type":"box","text":"NM1026U-5982568-168/232","page_number":168,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"1b0f8653-6d3e-452b-8561-ff938af85d2a","block_type":"box","text":"dividends and on the deemed redemption are calculated by applying the highest applicable marginal U.S. federal","page_number":169,"box":{"x":69,"y":45,"width":802,"height":11}},{"id":"ada475a2-d6cc-4c15-b8ac-e91a5ccd5a61","block_type":"box","text":"individual income tax rates in effect on the reinvestment and/or the redemption date. The rates used correspond to","page_number":169,"box":{"x":70,"y":60,"width":825,"height":11}},{"id":"126d9459-7ef8-4de8-ba66-e8a4502a89ee","block_type":"box","text":"the tax character (including eligibility for the maximum 20% tax rate applicable to qualified dividend income) of each","page_number":169,"box":{"x":68,"y":75,"width":823,"height":11}},{"id":"57a1c4fe-5354-4e17-8325-40bc3ace3be4","block_type":"box","text":"component of each dividend and/or the redemption payment. The applicable tax rates may vary over the","page_number":169,"box":{"x":69,"y":90,"width":743,"height":11}},{"id":"3b005c86-b09b-4bea-b217-7f675bcf3657","block_type":"box","text":"measurement period. The effects of state and local taxes are not reflected. Applicable tax credits, such as foreign","page_number":169,"box":{"x":69,"y":105,"width":814,"height":11}},{"id":"b3e83977-7b65-4d8a-b629-7a78e3007283","block_type":"box","text":"tax credits, are taken into account according to federal law.","page_number":169,"box":{"x":68,"y":120,"width":422,"height":12}},{"id":"7d3989b7-06a9-4f3a-a231-adc0c640ce40","block_type":"box","text":"A Fund also may quote annual, average annual and annualized total return and aggregate total return","page_number":169,"box":{"x":101,"y":143,"width":720,"height":11}},{"id":"7f3a2ee0-94c7-4c1b-af32-03abaad50aa7","block_type":"box","text":"per formance data, both as a percentage and as a dollar amount based on a hypothetical investment of $1,000 or","page_number":169,"box":{"x":70,"y":157,"width":813,"height":12}},{"id":"ef432677-03bc-4f59-b1f1-c4c2c5f11204","block_type":"box","text":"some other amount, for various periods other than those noted in Par t I of each Fund’s SAI. Such data will be","page_number":169,"box":{"x":69,"y":173,"width":781,"height":11}},{"id":"8fdb52de-1442-4295-b700-e657ca3ce280","block_type":"box","text":"computed as described above, except that (1) as required by the periods of the quotations, actual annual, annualized","page_number":169,"box":{"x":69,"y":188,"width":837,"height":11}},{"id":"435cebf1-9ce1-43ba-b616-d6ba2392e466","block_type":"box","text":"or aggregate data, rather than average annual data, may be quoted and (2) the maximum applicable sales charges","page_number":169,"box":{"x":69,"y":203,"width":817,"height":12}},{"id":"62bb8828-4bbc-4d25-b1e4-6321b61f594c","block_type":"box","text":"will not be included with respect to annual or annualized rates of return calculations. Aside from the impact on the","page_number":169,"box":{"x":68,"y":218,"width":815,"height":11}},{"id":"9e8cde7c-2290-4c4f-a9d1-03691c36e588","block_type":"box","text":"per formance data calculations of including or excluding the maximum applicable sales charges, actual annual or","page_number":169,"box":{"x":70,"y":234,"width":801,"height":11}},{"id":"9957c679-01dd-4e49-872f-4652110b8a20","block_type":"box","text":"annualized total return data generally will be lower than average annual total return data since the average rates of","page_number":169,"box":{"x":69,"y":249,"width":819,"height":11}},{"id":"e9010602-c5d4-4446-a870-44a0fad328ab","block_type":"box","text":"return reflect compounding of return; aggregate total return data generally will be higher than average annual total","page_number":169,"box":{"x":69,"y":264,"width":811,"height":11}},{"id":"53615295-8223-4bc1-ad46-fc8bc57dc9d3","block_type":"box","text":"return data since the aggregate rates of return reflect compounding over a longer period of time.","page_number":169,"box":{"x":69,"y":279,"width":686,"height":11}},{"id":"074e2a64-c68a-48d6-b805-bdedfa4301bc","block_type":"box","text":"Yield quotations will be computed based on a 30-day period by dividing (a) the net income based on the yield of","page_number":169,"box":{"x":101,"y":302,"width":796,"height":11}},{"id":"ca7082de-1f2c-4c33-8457-35ad43363956","block_type":"box","text":"each security earned during the period by (b) the average daily number of shares outstanding during the period that","page_number":169,"box":{"x":69,"y":317,"width":821,"height":11}},{"id":"599166d5-6dc8-4248-bf17-27da71c1aed1","block_type":"box","text":"were entitled to receive dividends multiplied by the maximum offering price per share on the last day of the period.","page_number":169,"box":{"x":68,"y":332,"width":817,"height":11}},{"id":"8e6eebfd-2ee4-48ea-a02e-8d1dcadbcf5e","block_type":"box","text":"Tax equivalent yield quotations will be computed by dividing (a) the par t of a Fund’s yield that is tax-exempt by (b) one","page_number":169,"box":{"x":68,"y":347,"width":837,"height":11}},{"id":"4043c06f-285e-4e86-81e3-a2a81af831b2","block_type":"box","text":"minus a stated tax rate and adding the result to that par t, if any, of the Fund’s yield that is not tax-exempt.","page_number":169,"box":{"x":69,"y":362,"width":759,"height":11}},{"id":"2df3bd57-d5d7-43e4-a33c-9de86aa3b80d","block_type":"box","text":"A Fund’s total return will vary depending on market conditions, the securities comprising a Fund’s por tfolio, a","page_number":169,"box":{"x":101,"y":385,"width":779,"height":11}},{"id":"89853777-c5f3-49aa-a5cc-a97eba046857","block_type":"box","text":"Fund’s operating expenses and the amount of realized and unrealized net capital gains or losses during the period.","page_number":169,"box":{"x":70,"y":400,"width":819,"height":11}},{"id":"27a15e40-5315-43b2-8405-24f331305645","block_type":"box","text":"The value of an investment in a Fund will fluctuate and an investor’s shares, when redeemed, may be wor th more or","page_number":169,"box":{"x":68,"y":415,"width":830,"height":11}},{"id":"e3f8a192-48fb-4bb7-8406-0b5bc2070333","block_type":"box","text":"less than their original cost.","page_number":169,"box":{"x":70,"y":430,"width":196,"height":11}},{"id":"12e0c7eb-4024-4eb3-8162-15ed7ac80229","block_type":"box","text":"In order to reflect the reduced sales charges in the case of front-end load shares or the waiver of the CDSC in","page_number":169,"box":{"x":102,"y":453,"width":782,"height":11}},{"id":"18acce5c-97c2-41e0-ad1b-cbdd6700596c","block_type":"box","text":"the case of CDSC shares applicable to cer tain investors, as described under “Purchase of Shares” and “Redemption","page_number":169,"box":{"x":68,"y":468,"width":836,"height":11}},{"id":"1ffec62b-10c8-4145-9147-366efe19244c","block_type":"box","text":"of Shares,” respectively, the total return data quoted by a Fund in adver tisements directed to such investors may","page_number":169,"box":{"x":69,"y":483,"width":807,"height":11}},{"id":"4522e7c9-1986-4abe-9642-9da8b36dfebc","block_type":"box","text":"take into account the reduced, and not the maximum, sales charge or may take into account the CDSC waiver and,","page_number":169,"box":{"x":68,"y":498,"width":820,"height":11}},{"id":"e74e56d8-d8cb-4351-8530-f15a8dc7db0a","block_type":"box","text":"therefore, may reflect greater total return since, due to the reduced sales charges or the waiver of sales charges, a","page_number":169,"box":{"x":68,"y":513,"width":824,"height":12}},{"id":"60c400fd-d7ce-4479-9cd3-fe73137603e6","block_type":"box","text":"lower amount of expenses is deducted.","page_number":169,"box":{"x":70,"y":528,"width":278,"height":11}},{"id":"30df1d61-9905-4238-aade-1bf77fa79c18","block_type":"box","text":"On occasion, a Fund may compare its per formance to, among other things, the Fund’s benchmark index","page_number":169,"box":{"x":102,"y":551,"width":741,"height":11}},{"id":"2e6000c6-eba7-48e3-9e00-e568692408d1","block_type":"box","text":"indicated in the Prospectus, the Value Line Composite Index, the Dow Jones Industrial Average, or to other published","page_number":169,"box":{"x":70,"y":566,"width":830,"height":11}},{"id":"08e111dd-87c3-4065-8057-bebfd7c0d461","block_type":"box","text":"indices, or to per formance data published by Lipper Inc., Morningstar, Inc. (“Morningstar”),","page_number":169,"box":{"x":70,"y":581,"width":646,"height":12}},{"id":"d5f6114c-6b1c-4d9e-a0ba-ba1774238e4b","block_type":"box","text":"Money Magazine, U.S.","page_number":169,"box":{"x":724,"y":581,"width":156,"height":12}},{"id":"9ac56ec4-c5ab-4b5e-b2c5-8bfb2e868d91","block_type":"box","text":"News & World Repor t, BusinessWeek, Forbes Magazine, For tune Magazine","page_number":169,"box":{"x":70,"y":597,"width":533,"height":11}},{"id":"45d979d6-4a07-434b-b8b5-e3f8510a594b","block_type":"box","text":"or other industry publications. When","page_number":169,"box":{"x":608,"y":597,"width":257,"height":11}},{"id":"142a6938-e882-4c8a-a9de-438fc89a47ea","block_type":"box","text":"comparing its per formance to a market index, a Fund may refer to various statistical measures derived from the","page_number":169,"box":{"x":69,"y":612,"width":797,"height":11}},{"id":"c37beb7c-5d24-4163-b826-315a6c7d32e8","block_type":"box","text":"historical per formance of a Fund and the index, such as standard deviation and beta. As with other per formance","page_number":169,"box":{"x":69,"y":627,"width":803,"height":11}},{"id":"5ac1b0ce-1113-4e0e-881c-472f063c5188","block_type":"box","text":"data, per formance comparisons should not be considered indicative of a Fund’s relative per formance for any future","page_number":169,"box":{"x":69,"y":642,"width":824,"height":11}},{"id":"6be09382-c272-4bdb-8c99-b8d98989a5c4","block_type":"box","text":"period. In addition, from time to time a Fund may include the Fund’s Morningstar risk-adjusted per formance ratings","page_number":169,"box":{"x":70,"y":657,"width":818,"height":11}},{"id":"550efd3c-b543-4389-907b-26b50a076179","block_type":"box","text":"assigned by Morningstar in adver tising or supplemental sales literature. From time to time a Fund may quote in","page_number":169,"box":{"x":69,"y":672,"width":793,"height":11}},{"id":"5c67bea1-8520-4047-828c-bd64028d4f70","block_type":"box","text":"adver tisements or other materials other applicable measures of Fund per formance and may also make reference to","page_number":169,"box":{"x":69,"y":687,"width":826,"height":11}},{"id":"9b7c5d63-d52c-4c5f-bbee-f5fd75e71aca","block_type":"box","text":"awards that may be given to the Manager. Cer tain Funds may also compare their per formance to composite indices","page_number":169,"box":{"x":69,"y":702,"width":825,"height":12}},{"id":"e40c968d-8b17-4dd4-88b7-21eca15659a3","block_type":"box","text":"developed by Fund management.","page_number":169,"box":{"x":69,"y":718,"width":233,"height":11}},{"id":"5221769b-5139-4f42-82c3-76669bd0edfb","block_type":"box","text":"A Fund may provide information designed to help investors understand how the Fund is seeking to achieve its","page_number":169,"box":{"x":101,"y":740,"width":780,"height":11}},{"id":"08aa5826-8364-45a8-93e0-7a79c872a59c","block_type":"box","text":"investment objectives. This may include information about past, current or possible economic, market, political or","page_number":169,"box":{"x":70,"y":755,"width":810,"height":11}},{"id":"e8821283-bc2f-4d89-84cd-a3fe9a364a82","block_type":"box","text":"other conditions, descriptive information or general principles of investing such as asset allocation, diversification","page_number":169,"box":{"x":69,"y":770,"width":810,"height":12}},{"id":"9c949a1d-943d-4c65-a2ff-7e4283ca75aa","block_type":"box","text":"and risk tolerance, discussion of a Fund’s por tfolio composition, investment philosophy, strategy or investment","page_number":169,"box":{"x":69,"y":785,"width":792,"height":12}},{"id":"de202c17-8c63-4481-b108-a17d6e7b4303","block_type":"box","text":"techniques, comparisons of the Fund’s per formance or por tfolio composition to that of other funds or types of","page_number":169,"box":{"x":68,"y":801,"width":788,"height":11}},{"id":"2c8dbfb1-3b49-46c1-8a8a-cadb7d5b458a","block_type":"box","text":"investments, indices relevant to the comparison being made, or to a hypothetical or model por tfolio. A Fund may also","page_number":169,"box":{"x":70,"y":816,"width":835,"height":11}},{"id":"60e6fb10-f26c-4dbb-bb80-231e40d2ea61","block_type":"box","text":"quote various measures of volatility and benchmark correlation in adver tising and other materials, and may compare","page_number":169,"box":{"x":69,"y":831,"width":830,"height":11}},{"id":"b272adef-5ec8-4d71-8e5e-dee7f3002851","block_type":"box","text":"these measures to those of other funds or types of investments.","page_number":169,"box":{"x":68,"y":846,"width":461,"height":11}},{"id":"d06583e6-fece-45a5-b9d4-38d178fe457a","block_type":"box","text":"II-138","page_number":169,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"4dec98cb-0bc5-44df-b72e-8ca48fcf69ab","block_type":"box","text":"NM1026U-5982568-169/232","page_number":169,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"afc32a97-cc6e-4031-9da4-f43fed4089c0","block_type":"box","text":"PROXY VOTING POLICIES AND PROCEDURES","page_number":170,"box":{"x":308,"y":45,"width":362,"height":10}},{"id":"6287a32a-0dfb-495e-a87a-bfe98f0157cc","block_type":"box","text":"The Board of Directors of the Funds has delegated the voting of proxies for the Funds’ securities to the Manager","page_number":170,"box":{"x":101,"y":68,"width":802,"height":11}},{"id":"c474bb75-5e79-4fa2-8b8e-92f3baeb0d8e","block_type":"box","text":"pursuant to (i) the Open-End Active and Fixed Income Index Fund Proxy Voting Policy (the “Active Fund Proxy Voting","page_number":170,"box":{"x":70,"y":83,"width":809,"height":11}},{"id":"74c98d0c-60c2-443d-a859-3e3e920ab5d1","block_type":"box","text":"Policy”), with respect to cer tain Funds, and (ii) the Index Equity Fund Proxy Voting Policy, with respect to cer tain other","page_number":170,"box":{"x":69,"y":98,"width":833,"height":11}},{"id":"52fb5df6-32a8-4676-91cb-626b44c92726","block_type":"box","text":"Funds, as applicable. Please refer to Par t I of this SAI, which discloses the policy applicable to each Fund.","page_number":170,"box":{"x":70,"y":113,"width":755,"height":11}},{"id":"2266573c-0240-42a7-9468-f3a81d5babb3","block_type":"box","text":"With respect to Funds covered by the Active Fund Proxy Voting Policy, the Manager has adopted the BlackRock","page_number":170,"box":{"x":101,"y":136,"width":785,"height":11}},{"id":"d65fb7ac-b98e-407b-845b-fa220ec3ce0e","block_type":"box","text":"Active Investment Stewardship—Global Engagement and Voting Guidelines (the “BAIS Guidelines”). Cer tain of such","page_number":170,"box":{"x":68,"y":151,"width":822,"height":11}},{"id":"455a0fb1-5e13-4de5-ba91-5ee99a3afab7","block_type":"box","text":"Funds, as listed within the Active Fund Proxy Voting Policy and as disclosed in Par t I of this SAI, follow supplemental","page_number":170,"box":{"x":70,"y":166,"width":824,"height":11}},{"id":"7891b13e-0952-4165-9a8b-6511588dd56a","block_type":"box","text":"guidelines within the BAIS Guidelines that are applicable to cer tain climate and decarbonization issues (the “BAIS","page_number":170,"box":{"x":68,"y":181,"width":812,"height":12}},{"id":"eaa5138b-3965-4ca1-a9b8-d3f9075f54a1","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines”).","page_number":170,"box":{"x":69,"y":197,"width":392,"height":10}},{"id":"849d8ecf-22d3-44d1-95d8-13d06a13c7aa","block_type":"box","text":"With respect to Funds covered by the Index Equity Fund Proxy Voting Policy, the Manager has adopted the","page_number":170,"box":{"x":101,"y":219,"width":749,"height":11}},{"id":"1af5c92b-f5f6-448d-9573-c2db7bb9b878","block_type":"box","text":"BlackRock Investment Stewardship (“BIS”) Global Benchmark Policy, comprised of the Global Principles for","page_number":170,"box":{"x":70,"y":234,"width":759,"height":11}},{"id":"acb7f63d-fe88-4ef4-a954-8113f0adb3a6","block_type":"box","text":"Benchmark Policies, regional voting guidelines, and engagement priorities, which are each available upon request. In","page_number":170,"box":{"x":70,"y":250,"width":830,"height":11}},{"id":"b80fec31-01cb-4fe5-9c6a-5009f003adf2","block_type":"box","text":"addition, cer tain of such Funds, as listed within the Index Equity Fund Proxy Voting Policy and as disclosed in Par t I of","page_number":170,"box":{"x":69,"y":264,"width":838,"height":12}},{"id":"639d0d8c-2239-4a39-9034-d27db7cc47f9","block_type":"box","text":"this SAI, follow supplemental guidelines that are applicable to cer tain climate and decarbonization issues (the “BIS","page_number":170,"box":{"x":68,"y":280,"width":822,"height":11}},{"id":"dac0faa8-cec1-4e6a-b1a0-a610a53d2892","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines”).","page_number":170,"box":{"x":69,"y":295,"width":392,"height":11}},{"id":"e6126e7b-cb5b-4f68-9dfd-35253783b531","block_type":"box","text":"If a Fund invests in an underlying fund managed by BlackRock, the Fund will use its proxy voting policy when","page_number":170,"box":{"x":102,"y":317,"width":767,"height":12}},{"id":"e77a3e63-c560-4bb9-8757-1bd89f619535","block_type":"box","text":"voting on proxies for the underlying fund while the underlying fund will use its proxy voting policy when voting proxies","page_number":170,"box":{"x":68,"y":332,"width":827,"height":12}},{"id":"a9fd942b-5884-41cc-9a02-4cb8ed145766","block_type":"box","text":"on investments the underlying fund holds. Therefore, the Fund may use the Active Fund Proxy Voting Policy while an","page_number":170,"box":{"x":69,"y":348,"width":819,"height":11}},{"id":"ba949c35-6680-4fe8-9465-97a081449fbe","block_type":"box","text":"underlying fund may use the Index Equity Fund Proxy Voting Policy, and the opposite is also true.","page_number":170,"box":{"x":69,"y":363,"width":684,"height":11}},{"id":"3c210d01-9d42-45ed-8558-0b8c76409dd0","block_type":"box","text":"Copies of the Active Fund Proxy Voting Policy, Index Equity Fund Proxy Voting Policy, the BAIS Guidelines, the","page_number":170,"box":{"x":102,"y":385,"width":766,"height":12}},{"id":"6d0cdc6e-7689-43ea-89f8-c2529cacd38f","block_type":"box","text":"Global Principles for Benchmark Policies and the BIS Climate and Decarbonization Stewardship Guidelines are","page_number":170,"box":{"x":69,"y":401,"width":784,"height":11}},{"id":"8b7b5f2d-9e8b-4f3d-b96f-d193461113a5","block_type":"box","text":"attached as Appendix B to this SAI. Only those guidelines that are applicable to a par ticular Fund pursuant to the","page_number":170,"box":{"x":69,"y":416,"width":805,"height":11}},{"id":"35f7e1f0-7560-48b3-ac7f-8f2bd45e8473","block_type":"box","text":"Active Fund Proxy Voting Policy or the Index Equity Fund Proxy Voting Policy are considered to form a par t of the","page_number":170,"box":{"x":68,"y":431,"width":790,"height":11}},{"id":"28154fe6-702f-42c5-8c4b-04b404cd0d2d","block_type":"box","text":"Fund’s SAI. Information on how each Fund voted proxies relating to por tfolio securities during the most recent 12-","page_number":170,"box":{"x":70,"y":446,"width":810,"height":11}},{"id":"a6634cd0-acbe-4768-a0ee-979e3c42b941","block_type":"box","text":"month period ended June 30 is available without charge, (i) at www.blackrock.com/proxyrecords and (ii) on the","page_number":170,"box":{"x":69,"y":461,"width":788,"height":11}},{"id":"b2f6e824-7511-45eb-82e3-198b83f897a8","block_type":"box","text":"Commission’s website at http://www.sec.gov.","page_number":170,"box":{"x":69,"y":476,"width":327,"height":11}},{"id":"f22222c3-19d2-4f17-965b-a71ca7e43ea7","block_type":"box","text":"GENERAL INFORMATION","page_number":170,"box":{"x":391,"y":506,"width":195,"height":9}},{"id":"f7e11124-52a4-40ba-8bdf-86c9346ab661","block_type":"box","text":"Description of Shares","page_number":170,"box":{"x":69,"y":536,"width":156,"height":11}},{"id":"da5a513b-229e-4a46-a181-2797148ba5b5","block_type":"box","text":"Shareholders of a Fund are entitled to one vote for each full share held and fractional votes for fractional shares","page_number":170,"box":{"x":102,"y":559,"width":800,"height":9}},{"id":"c5a5c0eb-cc7d-4d2b-900d-85cc7fd6c921","block_type":"box","text":"held in the election of Directors and generally on other matters submitted to the vote of shareholders of the Fund.","page_number":170,"box":{"x":69,"y":574,"width":811,"height":11}},{"id":"57704adc-da8c-4aad-91d7-d9a1fff2405d","block_type":"box","text":"Shareholders of a class that bears distribution and/or service expenses have exclusive voting rights with respect to","page_number":170,"box":{"x":69,"y":589,"width":825,"height":11}},{"id":"30f5e560-11de-4cdb-9b0e-da04f32f5bf8","block_type":"box","text":"matters relating to such distribution and service expenditures. Voting rights are not cumulative, so that the holders of","page_number":170,"box":{"x":69,"y":604,"width":838,"height":11}},{"id":"7dfc85a9-5a1f-4b59-9c63-1727915a4837","block_type":"box","text":"more than 50% of the shares voting in the election of Directors can, if they choose to do so, elect all the Directors of","page_number":170,"box":{"x":69,"y":619,"width":835,"height":11}},{"id":"6ea87215-c006-46b9-b1e0-99146ecb0c60","block_type":"box","text":"a Fund, in which event the holders of the remaining shares would be unable to elect any person as a Director.","page_number":170,"box":{"x":69,"y":634,"width":781,"height":12}},{"id":"893b8993-cfa5-45dd-8662-efef73ac7a2a","block_type":"box","text":"No Fund intends to hold annual meetings of shareholders in any year in which the Investment Company Act does","page_number":170,"box":{"x":102,"y":657,"width":801,"height":11}},{"id":"3ade2528-e458-45b9-81e6-2c90e100e043","block_type":"box","text":"not require shareholders to act upon any of the following matters: (i) election of Directors; (ii) approval of a","page_number":170,"box":{"x":69,"y":672,"width":760,"height":11}},{"id":"6375993c-39b7-4557-8e0f-1e608702a71b","block_type":"box","text":"management agreement; (iii) approval of a distribution agreement; and (iv) ratification of selection of independent","page_number":170,"box":{"x":69,"y":687,"width":810,"height":11}},{"id":"b4f6d2f4-7179-4d72-bfb4-4855c1f4449f","block_type":"box","text":"accountants. Shares issued are fully paid and non-assessable and have no preemptive rights. Redemption and","page_number":170,"box":{"x":69,"y":702,"width":790,"height":12}},{"id":"0ae61e31-af77-4ce6-83ff-6cdc436acd81","block_type":"box","text":"conversion rights are discussed elsewhere herein and in each Fund’s Prospectus. Each share of each class of","page_number":170,"box":{"x":69,"y":717,"width":787,"height":12}},{"id":"d62fc932-da09-48cd-a560-fd41f7d51411","block_type":"box","text":"Common Stock is entitled to par ticipate equally in dividends and distributions declared by a Fund and in the net","page_number":170,"box":{"x":69,"y":733,"width":797,"height":11}},{"id":"5fa4ef08-57de-4f61-926b-413e730f0bd1","block_type":"box","text":"assets of the Fund upon liquidation or dissolution after satisfaction of outstanding liabilities.","page_number":170,"box":{"x":69,"y":748,"width":658,"height":11}},{"id":"ad0e82c3-fc36-4b62-8ff5-a85a9e97aabe","block_type":"box","text":"For Funds organized as Maryland corporations, the by-laws of the Fund require that a special meeting of","page_number":170,"box":{"x":102,"y":770,"width":741,"height":12}},{"id":"12f78e64-370b-4e24-9bf1-5372a425a7f7","block_type":"box","text":"shareholders be held upon the written request of a minimum percentage of the outstanding shares of the Fund","page_number":170,"box":{"x":69,"y":785,"width":790,"height":12}},{"id":"191ba356-5509-4736-91cc-c0d8f101b6e1","block_type":"box","text":"entitled to vote at such meeting, if they comply with applicable Maryland law.","page_number":170,"box":{"x":69,"y":801,"width":546,"height":11}},{"id":"ffae9fd2-9198-414f-a25d-caf80c96c6dd","block_type":"box","text":"Cer tain of the Funds are organized as “Massachusetts business trusts.” Under Massachusetts law,","page_number":170,"box":{"x":102,"y":823,"width":712,"height":12}},{"id":"d733b275-87d4-4630-aa06-9ef701a25235","block_type":"box","text":"shareholders of such a trust may, under cer tain circumstances, be held personally liable as par tners for its","page_number":170,"box":{"x":69,"y":838,"width":765,"height":11}},{"id":"f51f0165-096f-4ed6-b50c-1c365be9cab3","block_type":"box","text":"obligations. However, the Declaration of Trust establishing a trust, a copy of which for each applicable Fund, together","page_number":170,"box":{"x":69,"y":853,"width":834,"height":12}},{"id":"5765412d-f047-49db-99fa-6b480a68c344","block_type":"box","text":"with all amendments thereto (the “Declaration of Trust”), is on file in the office of the Secretary of the","page_number":170,"box":{"x":68,"y":869,"width":729,"height":11}},{"id":"69ee7b42-0452-4fbd-93e1-0c050f5285e2","block_type":"box","text":"Commonwealth of Massachusetts, contains an express disclaimer of shareholder liability for acts or obligations of","page_number":170,"box":{"x":69,"y":884,"width":815,"height":11}},{"id":"53c0fb8d-d5bd-4902-a1c4-a586944e56d9","block_type":"box","text":"the trust and provides for indemnification and reimbursement of expenses out of the trust proper ty for any","page_number":170,"box":{"x":68,"y":899,"width":761,"height":11}},{"id":"6261a3db-15dd-4123-9442-b7baee651535","block_type":"box","text":"II-139","page_number":170,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"928d69f5-a038-4145-a49f-9e85d7ec20bc","block_type":"box","text":"NM1026U-5982568-170/232","page_number":170,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"ac826465-bb46-4602-a41e-6fe58092651d","block_type":"box","text":"shareholder held personally liable for the obligations of the trust. The Declaration of Trust also provides that a trust","page_number":171,"box":{"x":69,"y":45,"width":824,"height":11}},{"id":"76fef782-03e5-4bd0-b9b8-f740643a09a1","block_type":"box","text":"may maintain appropriate insurance (for example, fidelity bond and errors and omissions insurance) for the protection","page_number":171,"box":{"x":69,"y":60,"width":839,"height":11}},{"id":"95a66447-c1ef-4a05-9555-8e3a75b1e4c2","block_type":"box","text":"of the trust, its shareholders, trustees, officers, employees and agents covering possible tor t and other liabilities.","page_number":171,"box":{"x":69,"y":75,"width":813,"height":11}},{"id":"39914aef-5c51-458a-ac7b-be96f6927e69","block_type":"box","text":"Thus, the risk of a shareholder incurring financial loss on account of shareholder liability is limited to circumstances","page_number":171,"box":{"x":68,"y":90,"width":827,"height":11}},{"id":"7ad263cf-c975-4e15-9770-f1b62a018de3","block_type":"box","text":"in which both inadequate insurance existed and the trust itself was unable to meet its obligations.","page_number":171,"box":{"x":70,"y":105,"width":699,"height":11}},{"id":"bf43e096-fbb3-4043-8288-2ddbeafa1102","block_type":"box","text":"Cer tain Funds are organized as Delaware statutory trusts.","page_number":171,"box":{"x":102,"y":128,"width":413,"height":11}},{"id":"e182a80b-1554-48b3-aca1-a5c089943767","block_type":"box","text":"Additional Information","page_number":171,"box":{"x":68,"y":158,"width":161,"height":9}},{"id":"b69d172a-c288-4a27-9308-83be53ea9785","block_type":"box","text":"Under a separate agreement, BlackRock has granted cer tain Funds the right to use the “BlackRock” name and","page_number":171,"box":{"x":102,"y":181,"width":789,"height":11}},{"id":"02dbd93f-0029-4009-ad95-4f58f5ea098f","block_type":"box","text":"has reserved the right to (i) withdraw its consent to the use of such name by a Fund if the Fund ceases to retain","page_number":171,"box":{"x":69,"y":196,"width":799,"height":11}},{"id":"45c8d8f4-2906-492f-b963-f2f129ae214c","block_type":"box","text":"BlackRock Advisors, LLC or BlackRock Fund Advisors, as applicable, as investment adviser and (ii) to grant the use of","page_number":171,"box":{"x":70,"y":211,"width":837,"height":11}},{"id":"96515266-0f10-4c38-92fb-343490b00d8a","block_type":"box","text":"such name to any other company.","page_number":171,"box":{"x":69,"y":226,"width":238,"height":11}},{"id":"55ad6cf3-8b16-46c8-ac5c-c6f1606bde28","block_type":"box","text":"II-140","page_number":171,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"7604aad9-f379-4ef8-9603-e3b8c0197c3a","block_type":"box","text":"NM1026U-5982568-171/232","page_number":171,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"274f3cc9-b930-4faf-b369-24a3bddd61eb","block_type":"box","text":"APPENDIX A","page_number":172,"box":{"x":438,"y":45,"width":101,"height":10}},{"id":"03af7e1b-c9cd-4a78-ad53-b0d53ec3fce4","block_type":"box","text":"Description of Bond Ratings","page_number":172,"box":{"x":377,"y":68,"width":224,"height":13}},{"id":"5a6183ed-8b65-48b9-a5b1-30978de6a13e","block_type":"box","text":"A rating is generally assigned to a fixed-income security at the time of issuance by a credit rating agency","page_number":172,"box":{"x":101,"y":91,"width":743,"height":12}},{"id":"55700da5-0093-4415-98cc-99156a1e627c","block_type":"box","text":"designated as a nationally recognized statistical rating organization (“NRSRO”) by the Securities and Exchange","page_number":172,"box":{"x":69,"y":106,"width":787,"height":12}},{"id":"2df8c1a7-4bc4-470b-b2e4-394cdc55688b","block_type":"box","text":"Commission (“SEC”). While NRSROs may from time to time revise such ratings, they under take no obligation to do","page_number":172,"box":{"x":69,"y":121,"width":817,"height":12}},{"id":"e2b5939e-25e1-455f-a907-4ab163eacb83","block_type":"box","text":"so, and the ratings given to securities at issuance do not necessarily represent ratings which would be given to these","page_number":172,"box":{"x":69,"y":137,"width":837,"height":11}},{"id":"f982c63c-be30-47cb-b5a4-44ed967faf2c","block_type":"box","text":"securities on a par ticular subsequent date.","page_number":172,"box":{"x":69,"y":152,"width":306,"height":11}},{"id":"dab2fbd6-2700-4277-8923-bb34364695d2","block_type":"box","text":"NRSROs may rate specific investments (","page_number":172,"box":{"x":102,"y":174,"width":286,"height":12}},{"id":"0aca0c44-981a-4315-88ef-a9aa29c3c570","block_type":"box","text":"e.g.","page_number":172,"box":{"x":390,"y":176,"width":25,"height":10}},{"id":"9f2ea560-96c6-4f45-b596-96b3759ec6aa","block_type":"box","text":", bonds), issuers (","page_number":172,"box":{"x":417,"y":175,"width":128,"height":10}},{"id":"cd1ff0f7-e7a0-446c-8445-22359df67bcb","block_type":"box","text":"e.g.","page_number":172,"box":{"x":547,"y":176,"width":25,"height":10}},{"id":"c26dfab6-dfe0-43d4-bfbe-18dcaeb67413","block_type":"box","text":", corporations, governments and financial","page_number":172,"box":{"x":574,"y":174,"width":293,"height":12}},{"id":"ef72d56c-51c1-461e-bda7-2189576a6f39","block_type":"box","text":"institutions) and/or programs (","page_number":172,"box":{"x":70,"y":190,"width":217,"height":11}},{"id":"f6d40d83-cb32-486f-800c-ebdc4d672c3b","block_type":"box","text":"e.g.","page_number":172,"box":{"x":289,"y":191,"width":25,"height":10}},{"id":"0fac50c7-8788-43be-8e99-c08277e90e42","block_type":"box","text":", commercial paper programs). However, cer tain types of investments may not be","page_number":172,"box":{"x":317,"y":189,"width":578,"height":12}},{"id":"4f8940fd-c883-45e2-9f04-3b69e5899a6b","block_type":"box","text":"rated by NRSROs, such as cer tain government/sovereign obligations, US agency securities, commercial paper, time","page_number":172,"box":{"x":69,"y":205,"width":826,"height":11}},{"id":"7a3fc206-abcc-4f2a-944b-212863d1943b","block_type":"box","text":"deposits at financial institutions, and derivative instruments such as credit default swaps. For these types of","page_number":172,"box":{"x":69,"y":220,"width":777,"height":11}},{"id":"053d211c-3647-4709-875c-7d436bead4e6","block_type":"box","text":"investments, as well as US Treasury securities (some of which are not rated), where an NRSRO has not rated the","page_number":172,"box":{"x":70,"y":235,"width":807,"height":11}},{"id":"f3cc5da3-a08d-4b27-8719-ffd91883b01c","block_type":"box","text":"specific investment but has rated the investment’s issuer, program, financial institution or underlying reference","page_number":172,"box":{"x":69,"y":250,"width":791,"height":11}},{"id":"40b1c360-4355-40bd-b25d-a57829beb2d8","block_type":"box","text":"asset, BlackRock Advisors, LLC, BlackRock Fund Advisors or their respective affiliates (“BlackRock”) may consider","page_number":172,"box":{"x":69,"y":265,"width":816,"height":11}},{"id":"88466951-a0cc-492c-8c86-46ef1da6b8b5","block_type":"box","text":"the investment to have the same NRSRO rating as its issuer, program, financial institution or underlying reference","page_number":172,"box":{"x":68,"y":280,"width":812,"height":12}},{"id":"66c0ab78-8ac5-418a-993e-5ccf83e977db","block_type":"box","text":"asset, as applicable. In the case of municipal securities, where one NRSRO provides multiple ratings for the same","page_number":172,"box":{"x":69,"y":295,"width":815,"height":12}},{"id":"336d4d1e-be43-4eee-9348-85ec4b98b2e9","block_type":"box","text":"security (","page_number":172,"box":{"x":69,"y":311,"width":63,"height":11}},{"id":"3f9a2522-2ebd-439c-8534-34e12f214f85","block_type":"box","text":"e.g.","page_number":172,"box":{"x":134,"y":312,"width":25,"height":10}},{"id":"b060a2fd-37a4-4e4a-84af-f6247483da26","block_type":"box","text":", “underlying,” “insured” and/or “enhanced” ratings), BlackRock may consider the security to have the","page_number":172,"box":{"x":161,"y":311,"width":730,"height":11}},{"id":"6cbd166a-6c1d-40b5-a5a0-7d63f10b1659","block_type":"box","text":"highest of the multiple ratings.","page_number":172,"box":{"x":69,"y":326,"width":216,"height":11}},{"id":"80c7e7af-c7e9-46ad-836e-1c02f501a0cd","block_type":"box","text":"New issue securities (regardless of type) may not be rated by an NRSRO at the time of their initial offering.","page_number":172,"box":{"x":102,"y":348,"width":760,"height":12}},{"id":"cede15a9-79a4-47fa-8675-3b89afee47cc","block_type":"box","text":"Preliminary prospectuses or term sheets for new issue securities may include an expected rating for the security (as","page_number":172,"box":{"x":69,"y":363,"width":830,"height":12}},{"id":"5457cdcc-fca4-4c87-9677-9592bc4e5330","block_type":"box","text":"determined by the underwriter and/or issuer) or an NRSRO rating for the issuer of the security. If applicable, when","page_number":172,"box":{"x":69,"y":378,"width":812,"height":12}},{"id":"065befbe-b4b2-4635-9d96-8d15f37188f8","block_type":"box","text":"deciding whether to purchase a new issue security that has not yet been rated by an NRSRO, BlackRock may","page_number":172,"box":{"x":69,"y":394,"width":776,"height":11}},{"id":"fd1b7aab-36bd-440c-a83f-a73b78416f40","block_type":"box","text":"attribute an expected rating to the security based on: (i) the expected rating of the security set for th in the","page_number":172,"box":{"x":69,"y":409,"width":756,"height":11}},{"id":"a08d197d-525c-4dab-8237-0dcfff10007e","block_type":"box","text":"preliminary prospectus or term sheet for the security; (ii) the NRSRO’s rating for the issuer of the security set for th in","page_number":172,"box":{"x":70,"y":424,"width":835,"height":11}},{"id":"a41b597a-aa08-4853-bf19-3ca9db602e49","block_type":"box","text":"the preliminary prospectus or term sheet for the security; or (iii) with respect to asset-backed securities, the rating of","page_number":172,"box":{"x":68,"y":439,"width":836,"height":11}},{"id":"1a661af8-15ab-4f1f-a411-c9763bc21f97","block_type":"box","text":"a prior issuance having a similar structure or the same sponsor.","page_number":172,"box":{"x":69,"y":454,"width":456,"height":11}},{"id":"bec3fdb3-5e2f-4c40-aba9-f30123bc4e04","block_type":"box","text":"Where the investment objective of a fund is to track the per formance of an index that includes credit ratings","page_number":172,"box":{"x":101,"y":477,"width":771,"height":11}},{"id":"05fb7a2a-b169-4840-a4fa-62a2a62fd45e","block_type":"box","text":"eligibility criteria as par t of its index methodology, the fund may purchase any security within the index, such security","page_number":172,"box":{"x":69,"y":492,"width":832,"height":11}},{"id":"bec310d0-daae-42e7-ab99-03e67cd19d74","block_type":"box","text":"having been determined by the index provider as meeting its credit ratings eligibility criteria. The credit ratings","page_number":172,"box":{"x":69,"y":507,"width":782,"height":11}},{"id":"849ad606-4929-4a31-8951-df92d0d871a5","block_type":"box","text":"practices of an index provider may differ from BlackRock’s practices, as described above. Fur ther, the fund may","page_number":172,"box":{"x":70,"y":522,"width":796,"height":11}},{"id":"9f339eb2-0f21-47fd-bf72-d2c70b897959","block_type":"box","text":"invest, directly or indirectly, in securities that are not rated by a rating agency or securities with a credit rating that","page_number":172,"box":{"x":70,"y":537,"width":811,"height":12}},{"id":"eed71ab7-d500-46fb-908e-e1b9a914b242","block_type":"box","text":"differs from the credit rating specified in its index methodology in various circumstances, including where a security is","page_number":172,"box":{"x":69,"y":552,"width":840,"height":12}},{"id":"025914f6-db4c-4759-b121-22cbd4cbb6ec","block_type":"box","text":"downgraded but not yet removed from an index, following the removal of a security from an index prior to its sale by","page_number":172,"box":{"x":69,"y":567,"width":824,"height":12}},{"id":"2ce8915c-e480-4cb6-8719-1276648baad5","block_type":"box","text":"the fund or as a result of a corporate action or restructuring affecting an issuer of a security held by the fund.","page_number":172,"box":{"x":68,"y":583,"width":781,"height":11}},{"id":"496854ee-1450-4a27-800d-bfd12f0ce112","block_type":"box","text":"Fixed-income securities which are unrated may expose the investor to risks with respect to capacity to pay","page_number":172,"box":{"x":102,"y":606,"width":756,"height":10}},{"id":"057c6f3e-4fdd-4902-8243-13ffceef638f","block_type":"box","text":"interest or repay principal which are similar to the risks of lower-rated speculative bonds (although BlackRock may","page_number":172,"box":{"x":70,"y":620,"width":811,"height":12}},{"id":"fb988fff-8c10-49d8-bd20-19bdc0014421","block_type":"box","text":"deem such unrated securities to be of higher quality). Evaluation of these securities is dependent on BlackRock’s","page_number":172,"box":{"x":69,"y":635,"width":809,"height":12}},{"id":"8b9ca4a2-f3e9-4e36-9267-37c43b97930b","block_type":"box","text":"judgment, analysis and experience in the evaluation of such securities.","page_number":172,"box":{"x":67,"y":651,"width":506,"height":11}},{"id":"ba8d6527-3dfb-4a13-8c2f-66daa2735f0b","block_type":"box","text":"Investors should note that the assignment of a rating to a security by an NRSRO may not reflect the effect of","page_number":172,"box":{"x":102,"y":673,"width":776,"height":12}},{"id":"446fbff2-0c6b-43f5-a499-822f9ab2357c","block_type":"box","text":"recent developments on the issuer’s ability to make interest and principal payments or on the likelihood of default.","page_number":172,"box":{"x":69,"y":688,"width":818,"height":12}},{"id":"bf9d2ae4-ac6c-4a2b-8430-12999fc02ffb","block_type":"box","text":"Securities deemed to be high yield are rated below Baa3 by Moody’s and below BBB- by S&P Global Ratings and","page_number":172,"box":{"x":102,"y":711,"width":799,"height":11}},{"id":"e69b2acb-dac3-4045-82ef-da1745682b43","block_type":"box","text":"Fitch. Other terms used to describe such securities include “lower rated bonds,” “non-investment grade bonds,”","page_number":172,"box":{"x":70,"y":726,"width":798,"height":11}},{"id":"e2b0f39d-a7cf-46a8-8d41-c34e44057ce4","block_type":"box","text":"“below investment grade bonds,” and “junk bonds.”","page_number":172,"box":{"x":70,"y":742,"width":368,"height":11}},{"id":"0c4062aa-f121-475d-b48f-87090053661b","block_type":"box","text":"The descriptions below relate to general long-term and shor t-term obligations of an issuer.","page_number":172,"box":{"x":101,"y":764,"width":643,"height":11}},{"id":"4712d35c-5b9f-4555-9964-cb6bf7a38bf8","block_type":"box","text":"A Description of Moody’s Investors Service, Inc.’s (“Moody’s”) Global Rating Scales","page_number":172,"box":{"x":68,"y":794,"width":616,"height":11}},{"id":"5548eb15-178a-4791-8c77-5ef71d992a1f","block_type":"box","text":"Credit ratings are assigned on Moody’s global long-term and shor t-term rating scales and are forward-looking","page_number":172,"box":{"x":102,"y":817,"width":777,"height":11}},{"id":"e76dcc7e-367b-4a0a-9657-cdf2ccbc140c","block_type":"box","text":"opinions of the relative credit risks of financial obligations issued by non-financial corporates, financial institutions,","page_number":172,"box":{"x":69,"y":832,"width":818,"height":11}},{"id":"c4bedde2-963f-4bfd-81b9-e4f992fa5d21","block_type":"box","text":"structured finance vehicles, project finance vehicles, and public sector entities. Moody’s defines credit risk as the","page_number":172,"box":{"x":69,"y":847,"width":812,"height":11}},{"id":"2e61daa5-d8bb-4078-84b6-c9db5a56bf27","block_type":"box","text":"risk that an entity may not meet its contractual financial obligations as they come due and any estimated financial","page_number":172,"box":{"x":69,"y":862,"width":812,"height":12}},{"id":"abb3f0d4-1097-4e6e-8713-b5281f72fb61","block_type":"box","text":"loss in the event of default or impairment. The contractual financial obligations addressed by Moody’s ratings are","page_number":172,"box":{"x":70,"y":877,"width":807,"height":12}},{"id":"315c3eaf-8d7b-4432-b337-6b9febec3727","block_type":"box","text":"those that call for, without regard to enforceability, the payment of an ascer tainable amount, which may vary based","page_number":172,"box":{"x":68,"y":892,"width":821,"height":12}},{"id":"fdaacc98-7148-41ab-a69f-5b111e727877","block_type":"box","text":"upon standard sources of variation (","page_number":172,"box":{"x":69,"y":908,"width":257,"height":11}},{"id":"a172d1d2-fb8a-4db5-bd03-90bb51480547","block_type":"box","text":"e.g.","page_number":172,"box":{"x":328,"y":909,"width":25,"height":10}},{"id":"e6412247-e2cd-4678-a35b-c3a5aa12f111","block_type":"box","text":", floating interest rates), by an ascer tainable date. Moody’s rating addresses","page_number":172,"box":{"x":355,"y":908,"width":548,"height":11}},{"id":"49505366-ff79-42f6-a6a7-976742ee0a3a","block_type":"box","text":"A-1","page_number":172,"box":{"x":477,"y":943,"width":24,"height":9}},{"id":"d613fb54-8785-42b9-b643-3346433dbc88","block_type":"box","text":"NM1026U-5982568-172/232","page_number":172,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"c79eb094-3c8c-48da-9b49-f8c230015865","block_type":"box","text":"the issuer’s ability to obtain cash sufficient to service the obligation, and its willingness to pay. Moody’s ratings do","page_number":173,"box":{"x":68,"y":45,"width":821,"height":11}},{"id":"cde4e7ad-a3a9-4040-8337-7f7b3c25abd9","block_type":"box","text":"not address non-standard sources of variation in the amount of the principal obligation (","page_number":173,"box":{"x":69,"y":60,"width":627,"height":11}},{"id":"a4d20e37-56c0-4b1c-917c-f76667b25a2f","block_type":"box","text":"e.g.","page_number":173,"box":{"x":697,"y":61,"width":25,"height":10}},{"id":"a0a63902-49fc-46f1-8f97-28e4ac18934b","block_type":"box","text":", equity indexed), absent","page_number":173,"box":{"x":725,"y":60,"width":174,"height":11}},{"id":"4a844780-20bb-4eb5-aeae-f76d2b8a7964","block_type":"box","text":"an express statement to the contrary in a press release accompanying an initial rating. Long-term ratings are","page_number":173,"box":{"x":69,"y":75,"width":777,"height":11}},{"id":"7b4aab69-1795-4c7c-926a-03929eb60d08","block_type":"box","text":"assigned to issuers or obligations with an original maturity of eleven months or more and reflect both on the","page_number":173,"box":{"x":69,"y":90,"width":771,"height":11}},{"id":"a180af2a-8a49-4ff4-8fed-53c5e47c951e","block_type":"box","text":"likelihood of a default or impairment on contractual financial obligations and the expected financial loss suffered in","page_number":173,"box":{"x":70,"y":105,"width":819,"height":11}},{"id":"735304df-710f-455e-9baa-3299d5040db7","block_type":"box","text":"the event of default or impairment. Shor t-term ratings are assigned for obligations with an original maturity of thir teen","page_number":173,"box":{"x":68,"y":120,"width":840,"height":12}},{"id":"84f2b8a6-b65a-49b1-a183-9ba13fda2abd","block_type":"box","text":"months or less and reflect both on the likelihood of a default or impairment on contractual financial obligations and","page_number":173,"box":{"x":69,"y":135,"width":822,"height":12}},{"id":"5b6b8249-ee2f-409a-b5f1-6bf3bdafcf1b","block_type":"box","text":"the expected financial loss suffered in the event of default or impairment. Moody’s issues ratings at the issuer level","page_number":173,"box":{"x":68,"y":150,"width":829,"height":12}},{"id":"1d505113-9429-497d-aa73-57ca1b03e862","block_type":"box","text":"and instrument level on both the long-term scale and the shor t-term scale. Typically, ratings are made publicly","page_number":173,"box":{"x":69,"y":166,"width":784,"height":11}},{"id":"f06169b3-5188-4788-aab4-3b7d3d74ffc1","block_type":"box","text":"available although private and unpublished ratings may also be assigned.","page_number":173,"box":{"x":69,"y":181,"width":521,"height":11}},{"id":"028dfd29-3d3e-493d-800b-0506e81599bc","block_type":"box","text":"Moody’s differentiates structured finance ratings from fundamental ratings (","page_number":173,"box":{"x":102,"y":203,"width":542,"height":12}},{"id":"5662e619-f66d-4e54-bf60-4a731ae2db32","block_type":"box","text":"i.e.","page_number":173,"box":{"x":646,"y":204,"width":20,"height":8}},{"id":"f1cccade-388c-4b3d-bd48-bc06e6f497fa","block_type":"box","text":", ratings on nonfinancial","page_number":173,"box":{"x":669,"y":203,"width":169,"height":12}},{"id":"cfb498d8-2506-44b2-a9e6-dea08475cf53","block_type":"box","text":"corporate, financial institution, and public sector entities) on the global long-term scale by adding (sf) to all structured","page_number":173,"box":{"x":69,"y":218,"width":837,"height":12}},{"id":"1c65c8ee-ef8d-4c83-ba4f-95f4b0453eaa","block_type":"box","text":"finance ratings. The addition of (sf) to structured finance ratings should eliminate any presumption that such ratings","page_number":173,"box":{"x":68,"y":234,"width":828,"height":11}},{"id":"10edd9d6-69c1-4748-ba01-c5f4001cadca","block_type":"box","text":"and fundamental ratings at the same letter grade level will behave the same. The (sf) indicator for structured finance","page_number":173,"box":{"x":69,"y":249,"width":832,"height":11}},{"id":"1f2e0b18-b435-43e0-b1a1-c7f74656103b","block_type":"box","text":"security ratings indicates that otherwise similarly rated structured finance and fundamental securities may have","page_number":173,"box":{"x":69,"y":264,"width":797,"height":11}},{"id":"5efe4926-9738-44a3-a836-019cb262b459","block_type":"box","text":"different risk characteristics. Through its current methodologies, however, Moody’s aspires to achieve broad","page_number":173,"box":{"x":69,"y":279,"width":771,"height":11}},{"id":"6ffe38e4-b9c7-4fb6-9cae-86da3315589b","block_type":"box","text":"expected equivalence in structured finance and fundamental rating per formance when measured over a long period","page_number":173,"box":{"x":69,"y":294,"width":821,"height":11}},{"id":"e9ac59a6-d659-4298-9c20-69a1a3007c7f","block_type":"box","text":"of time.","page_number":173,"box":{"x":69,"y":309,"width":53,"height":9}},{"id":"03bce933-8353-4703-91ae-9f279c655d9a","block_type":"box","text":"Description of Moody’s Global Long-Term Rating Scale","page_number":173,"box":{"x":69,"y":339,"width":395,"height":12}},{"id":"180cbd54-f7df-4607-8983-fb19be515f38","block_type":"box","text":"Aaa Obligations rated Aaa are judged to be of the highest quality, subject to the lowest level of credit","page_number":173,"box":{"x":68,"y":367,"width":815,"height":11}},{"id":"bdd11730-6941-49a0-86c5-5edb6d4fae27","block_type":"box","text":"risk.","page_number":173,"box":{"x":197,"y":383,"width":28,"height":8}},{"id":"f29a41bf-6d28-48d5-a0b2-0009aba84fef","block_type":"box","text":"Aa Obligations rated Aa are judged to be of high quality and are subject to very low credit risk.","page_number":173,"box":{"x":68,"y":402,"width":773,"height":12}},{"id":"fa5e5284-3c0b-4c19-83cd-8f17c71ec20d","block_type":"box","text":"A Obligations rated A are judged to be upper-medium grade and are subject to low credit risk.","page_number":173,"box":{"x":68,"y":423,"width":776,"height":11}},{"id":"f699569a-f334-409b-8f90-80d34459795e","block_type":"box","text":"Baa Obligations rated Baa are judged to be medium-grade and subject to moderate credit risk and as","page_number":173,"box":{"x":70,"y":443,"width":813,"height":11}},{"id":"e151567d-b95a-4f91-90aa-bd8072d874b9","block_type":"box","text":"such may possess cer tain speculative characteristics.","page_number":173,"box":{"x":196,"y":458,"width":385,"height":11}},{"id":"2286105c-f1bf-4989-aeda-5153d22e41b4","block_type":"box","text":"Ba Obligations rated Ba are judged to be speculative and are subject to substantial credit risk.","page_number":173,"box":{"x":70,"y":478,"width":775,"height":11}},{"id":"06bcd2c0-cfdb-4ad7-9192-a18dbb7f0b96","block_type":"box","text":"B Obligations rated B are considered speculative and are subject to high credit risk.","page_number":173,"box":{"x":70,"y":498,"width":707,"height":11}},{"id":"b9c8a17f-cde1-4ee1-86f8-fa552582bdfb","block_type":"box","text":"Caa Obligations rated Caa are judged to be speculative of poor standing and are subject to very high","page_number":173,"box":{"x":69,"y":518,"width":810,"height":12}},{"id":"cc677695-2d72-48e0-9efc-7abf2a0bd19c","block_type":"box","text":"credit risk.","page_number":173,"box":{"x":196,"y":534,"width":74,"height":8}},{"id":"96d88407-38bc-4e32-a570-284e38c96611","block_type":"box","text":"Ca Obligations rated Ca are highly speculative and are likely in, or very near, default, with some","page_number":173,"box":{"x":69,"y":554,"width":783,"height":11}},{"id":"132588a2-95f3-4173-9121-d328e35b1442","block_type":"box","text":"prospect of recovery of principal and interest.","page_number":173,"box":{"x":197,"y":569,"width":322,"height":11}},{"id":"3b54a6da-31c5-4db1-bdbf-a6bef7a1e760","block_type":"box","text":"C Obligations rated C are the lowest rated and are typically in default, with little prospect for recovery","page_number":173,"box":{"x":69,"y":589,"width":834,"height":11}},{"id":"f8f92b6c-2428-4480-8080-63debe9277eb","block_type":"box","text":"of principal or interest.","page_number":173,"box":{"x":196,"y":604,"width":160,"height":11}},{"id":"d36c6968-90fc-4574-a166-16ac4c0a6295","block_type":"box","text":"Note:","page_number":173,"box":{"x":102,"y":624,"width":37,"height":9}},{"id":"aed81ba2-412b-4cea-b450-b09ad5c6b6e2","block_type":"box","text":"Moody’s appends numerical modifiers 1, 2, and 3 to each generic rating classification from Aa through","page_number":173,"box":{"x":146,"y":624,"width":731,"height":11}},{"id":"09d24327-e2ef-4973-be3d-2f63e7871241","block_type":"box","text":"Caa. The modifier 1 indicates that the obligation ranks in the higher end of its generic rating category; the modifier 2","page_number":173,"box":{"x":69,"y":639,"width":831,"height":12}},{"id":"f4465353-e9e4-4159-8ffe-dbe1ed959bae","block_type":"box","text":"indicates a mid-range ranking; and the modifier 3 indicates a ranking in the lower end of that generic rating category.","page_number":173,"box":{"x":70,"y":654,"width":829,"height":12}},{"id":"e39e26d3-34f7-4729-9c46-70893aeb3cab","block_type":"box","text":"Additionally, a “(hyb)” indicator is appended to all ratings of hybrid securities issued by banks, insurers, finance","page_number":173,"box":{"x":68,"y":669,"width":795,"height":12}},{"id":"61800ab2-7393-4670-96e9-27ce412bddec","block_type":"box","text":"companies, and securities firms.","page_number":173,"box":{"x":69,"y":685,"width":232,"height":11}},{"id":"6a0bf13c-d25f-4e5a-9391-d64317d17359","block_type":"box","text":"By their terms, hybrid securities allow for the omission of scheduled dividends, interest, or principal payments,","page_number":173,"box":{"x":102,"y":707,"width":787,"height":11}},{"id":"322b2847-168e-4f2a-847c-d808eac11519","block_type":"box","text":"which can potentially result in impairment if such an omission occurs. Hybrid securities may also be subject to","page_number":173,"box":{"x":68,"y":722,"width":788,"height":12}},{"id":"fb63a930-0639-4d8d-8178-c04a1eb36888","block_type":"box","text":"contractually allowable write-downs of principal that could result in impairment. Together with the hybrid indicator, the","page_number":173,"box":{"x":69,"y":738,"width":833,"height":11}},{"id":"3d381cd7-36f0-4610-b19a-601c14e5f503","block_type":"box","text":"long-term obligation rating assigned to a hybrid security is an expression of the relative credit risk associated with","page_number":173,"box":{"x":70,"y":753,"width":809,"height":11}},{"id":"c33b0c9c-328e-4957-8e3e-2726447883cc","block_type":"box","text":"that security.","page_number":173,"box":{"x":68,"y":768,"width":91,"height":11}},{"id":"f0651a83-5a07-43c8-9edb-bc2cd6a1ddc3","block_type":"box","text":"Description of Moody’s Global Short-Term Rating Scale","page_number":173,"box":{"x":69,"y":798,"width":400,"height":11}},{"id":"436a7e74-1344-49a4-9cfa-68fff96ae5df","block_type":"box","text":"P-1 Ratings of Prime-1 reflect a superior ability to repay shor t-term obligations.","page_number":173,"box":{"x":69,"y":826,"width":658,"height":11}},{"id":"8345ab9b-6a04-4852-b37d-4cdcf25cde8c","block_type":"box","text":"P-2 Ratings of Prime-2 reflect a strong ability to repay shor t-term obligations.","page_number":173,"box":{"x":69,"y":846,"width":645,"height":11}},{"id":"be41a533-427e-4ebb-a482-28bd956bca2c","block_type":"box","text":"P-3 Ratings of Prime-3 reflect an acceptable ability to repay shor t-term obligations.","page_number":173,"box":{"x":69,"y":866,"width":686,"height":11}},{"id":"79d2b742-d502-4013-b836-2ef739c4feb3","block_type":"box","text":"NP Issuers (or suppor ting institutions) rated Not Prime do not fall within any of the Prime rating","page_number":173,"box":{"x":70,"y":886,"width":778,"height":12}},{"id":"47acb41f-8b49-44a0-90e6-315071960079","block_type":"box","text":"categories.","page_number":173,"box":{"x":196,"y":902,"width":77,"height":11}},{"id":"4b2f0bf0-b69d-4b0b-b641-1c927104af2c","block_type":"box","text":"A-2","page_number":173,"box":{"x":477,"y":943,"width":23,"height":9}},{"id":"30e26904-3758-482e-8c3c-94d50bf6c04e","block_type":"box","text":"NM1026U-5982568-173/232","page_number":173,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"dcd8f6f0-d6c4-45c8-a428-0f82c98962ff","block_type":"box","text":"Description of Moody’s U.S. Municipal Short-Term Debt and Demand Obligation Ratings","page_number":174,"box":{"x":69,"y":45,"width":637,"height":11}},{"id":"5680c21a-3647-4703-b9f5-ae2b88201b7d","block_type":"box","text":"Moody’s uses the global shor t-term Prime rating scale for commercial paper issued by U.S. municipalities and","page_number":174,"box":{"x":102,"y":67,"width":784,"height":12}},{"id":"68eeaacd-b5c6-4ca2-9897-929988128134","block_type":"box","text":"nonprofits. These commercial paper programs may be backed by external letters of credit or liquidity facilities, or by","page_number":174,"box":{"x":69,"y":82,"width":824,"height":12}},{"id":"c19883ac-5034-4538-8746-deb825072d1c","block_type":"box","text":"an issuer’s self-liquidity.","page_number":174,"box":{"x":69,"y":98,"width":170,"height":11}},{"id":"ae481311-2c00-4b2f-b17f-7d9d77414251","block_type":"box","text":"For other shor t-term municipal obligations, Moody’s uses one of two other shor t-term rating scales, the","page_number":174,"box":{"x":102,"y":120,"width":736,"height":12}},{"id":"6897c173-1421-4caf-83cb-d8e4d22a0adf","block_type":"box","text":"Municipal Investment Grade (“MIG”) and Variable Municipal Investment Grade (“VMIG”) scales discussed below.","page_number":174,"box":{"x":70,"y":135,"width":796,"height":11}},{"id":"3827e389-fda2-4235-822f-2a6471bc2031","block_type":"box","text":"MIG Ratings","page_number":174,"box":{"x":102,"y":158,"width":85,"height":11}},{"id":"4a02a26b-d81f-459d-b3cd-02e11521507c","block_type":"box","text":"Moody’s uses the MIG scale for U.S. municipal cash flow notes, bond anticipation notes and cer tain other shor t","page_number":174,"box":{"x":102,"y":181,"width":803,"height":11}},{"id":"3f09bfc4-8e54-45d4-b27c-1bf9e194effc","block_type":"box","text":"term obligations, which typically mature in three years or less. Under cer tain circumstances, Moody’s uses the MIG","page_number":174,"box":{"x":68,"y":196,"width":823,"height":11}},{"id":"a7730132-b889-4c1c-b778-ac1a752342ca","block_type":"box","text":"scale for bond anticipation notes with maturities of up to five years.","page_number":174,"box":{"x":69,"y":211,"width":480,"height":11}},{"id":"2ed23e23-cc0b-4b3b-acb2-9f886ab0e5f2","block_type":"box","text":"MIG Scale","page_number":174,"box":{"x":102,"y":234,"width":71,"height":9}},{"id":"34d6b9f8-0ff5-4e05-8ab8-225e09a1d4e8","block_type":"box","text":"MIG 1 This designation denotes superior credit quality. Excellent protection is afforded by established","page_number":174,"box":{"x":70,"y":261,"width":802,"height":12}},{"id":"de8e3a1a-9935-4a2e-82a8-c95e5e875da0","block_type":"box","text":"cash flows, highly reliable liquidity suppor t, or demonstrated broad-based access to the market for","page_number":174,"box":{"x":196,"y":276,"width":703,"height":12}},{"id":"c3760ee9-647e-4258-81a2-89155f9256a5","block_type":"box","text":"refinancing.","page_number":174,"box":{"x":197,"y":292,"width":80,"height":11}},{"id":"d180f14e-70c1-4d04-a4ba-1502dd41f690","block_type":"box","text":"MIG 2 This designation denotes strong credit quality. Margins of protection are ample, although not as","page_number":174,"box":{"x":70,"y":312,"width":809,"height":11}},{"id":"330f229b-13ba-4c49-bdce-25cfed5ebe52","block_type":"box","text":"large as in the preceding group.","page_number":174,"box":{"x":197,"y":327,"width":224,"height":11}},{"id":"83255ca8-67d4-43e1-b06f-3c35f05c924a","block_type":"box","text":"MIG 3 This designation denotes acceptable credit quality. Liquidity and cash-flow protection may be","page_number":174,"box":{"x":70,"y":347,"width":785,"height":11}},{"id":"7895502a-7b71-4fe7-b631-bd42c5227880","block_type":"box","text":"narrow, and market access for refinancing is likely to be less well-established.","page_number":174,"box":{"x":197,"y":362,"width":554,"height":11}},{"id":"f9fb89fa-1e68-4146-86aa-536f26450bd2","block_type":"box","text":"SG This designation denotes speculative-grade credit quality. Debt instruments in this category may","page_number":174,"box":{"x":69,"y":382,"width":813,"height":12}},{"id":"e0e8088a-4aa1-499e-a5cf-d3b2a6a5c465","block_type":"box","text":"lack sufficient margins of protection.","page_number":174,"box":{"x":197,"y":397,"width":259,"height":12}},{"id":"308315a2-2517-42cc-b04e-3bf2df099c97","block_type":"box","text":"VMIG Ratings","page_number":174,"box":{"x":68,"y":425,"width":100,"height":11}},{"id":"b1ed0718-7082-445a-ae86-68d4bfe259d0","block_type":"box","text":"In the case of variable rate demand obligations (“VRDOs”), a two-component rating is assigned. The components","page_number":174,"box":{"x":102,"y":448,"width":804,"height":11}},{"id":"61faf4e2-a333-49d7-8c65-56dca7bb2fdc","block_type":"box","text":"are a long-term rating and a shor t-term payment obligation rating. The long-term rating addresses the issuer’s ability","page_number":174,"box":{"x":69,"y":463,"width":829,"height":11}},{"id":"52ea96c5-b623-45a5-b96b-824c02466a1c","block_type":"box","text":"to meet scheduled principal and interest payments. The shor t-term payment obligation rating addresses the ability of","page_number":174,"box":{"x":68,"y":478,"width":836,"height":11}},{"id":"c8af43da-a1c5-4964-abde-dd70409d0b49","block_type":"box","text":"the issuer or the liquidity provider meet any purchase-price payment obligation resulting from optional tenders (“on","page_number":174,"box":{"x":68,"y":493,"width":817,"height":11}},{"id":"689310e9-b143-4089-b854-06090683a37d","block_type":"box","text":"demand”) and/or mandatory tenders of the VRDO. The shor t-term demand obligation rating uses the VMIG scale.","page_number":174,"box":{"x":69,"y":508,"width":807,"height":12}},{"id":"2d168c5e-6d8d-4cfe-8802-6c763b4c3d62","block_type":"box","text":"VMIG ratings with liquidity suppor t use as an input the shor t-term Counterpar ty Risk Assessment of the suppor t","page_number":174,"box":{"x":68,"y":523,"width":800,"height":12}},{"id":"4be1d563-4a33-43ee-bef6-dd0a05557556","block_type":"box","text":"provider, or the long-term rating of the underlying obligor in the absence of third par ty liquidity suppor t. Transitions of","page_number":174,"box":{"x":70,"y":538,"width":832,"height":12}},{"id":"3c4500ec-ec40-4230-ae6b-1b6b627ba15e","block_type":"box","text":"VMIG ratings of demand obligations with conditional liquidity suppor t differ from transitions on the Prime scale to","page_number":174,"box":{"x":68,"y":554,"width":807,"height":11}},{"id":"83b7e9fb-47a9-4eaa-b7f6-082850091e87","block_type":"box","text":"reflect the risk that external liquidity suppor t will terminate if the issuer’s long-term rating drops below investment","page_number":174,"box":{"x":69,"y":569,"width":812,"height":11}},{"id":"579f31f9-bc21-4e6f-928f-245266568f3e","block_type":"box","text":"grade.","page_number":174,"box":{"x":68,"y":584,"width":43,"height":11}},{"id":"11c6ad3a-00ae-42a6-af11-9fe2a7b32137","block_type":"box","text":"Moody’s typically assigns the VMIG shor t-term demand obligation rating if the frequency of the demand feature is","page_number":174,"box":{"x":102,"y":606,"width":807,"height":12}},{"id":"d17bc5b9-9c0f-4d3e-82f3-f50f06d543d4","block_type":"box","text":"less than every three years. If the frequency of the demand feature is less than three years but the purchase price is","page_number":174,"box":{"x":70,"y":622,"width":833,"height":11}},{"id":"8066d4ac-4049-4ae6-994c-de3ace7d75f7","block_type":"box","text":"payable only with remarketing proceeds, the shor t-term demand obligation rating is “NR”.","page_number":174,"box":{"x":70,"y":637,"width":635,"height":11}},{"id":"f2dd9d22-196b-4d8a-9280-54c70349e57a","block_type":"box","text":"Industrial development bonds in the US where the obligor is a corporate may carry a VMIG rating that reflects","page_number":174,"box":{"x":102,"y":659,"width":778,"height":12}},{"id":"0ca4030c-7312-4e0e-b57c-32337972f56b","block_type":"box","text":"Moody’s view of the relative likelihood of default and loss. In these cases, liquidity assessment is based on the","page_number":174,"box":{"x":70,"y":675,"width":795,"height":11}},{"id":"1701c272-e4d6-4028-932d-353e19655247","block_type":"box","text":"liquidity of the corporate obligor.","page_number":174,"box":{"x":70,"y":690,"width":226,"height":11}},{"id":"d3e6d25c-da15-4da7-be48-da0860385b08","block_type":"box","text":"VMIG Scale","page_number":174,"box":{"x":101,"y":712,"width":81,"height":9}},{"id":"85b26cc8-cf29-4913-8037-f912c55666d9","block_type":"box","text":"VMIG 1 This designation denotes superior credit quality. Excellent protection is afforded by the superior","page_number":174,"box":{"x":68,"y":740,"width":808,"height":11}},{"id":"c44e1f08-374b-42e4-a707-d01955f97926","block_type":"box","text":"shor t-term credit strength of the liquidity provider and structural and legal protections.","page_number":174,"box":{"x":196,"y":755,"width":613,"height":11}},{"id":"bec23bc5-ce36-436f-a477-69381bb8252e","block_type":"box","text":"VMIG 2 This designation denotes strong credit quality. Good protection is afforded by the strong shor t-term","page_number":174,"box":{"x":68,"y":775,"width":834,"height":12}},{"id":"586b0853-0572-427c-8f26-d9019d8f9701","block_type":"box","text":"credit strength of the liquidity provider and structural and legal protections.","page_number":174,"box":{"x":196,"y":790,"width":533,"height":12}},{"id":"9ef312b1-91bf-40a0-937c-0f0d9638d0ad","block_type":"box","text":"VMIG 3 This designation denotes acceptable credit quality. Adequate protection is afforded by the","page_number":174,"box":{"x":68,"y":811,"width":768,"height":11}},{"id":"b292cbaf-5fe2-4dcf-99a7-295f102a6a20","block_type":"box","text":"satisfactory shor t-term credit strength of the liquidity provider and structural and legal protections.","page_number":174,"box":{"x":196,"y":826,"width":701,"height":11}},{"id":"c9c1ce72-8713-4906-8a8d-7229f33c7880","block_type":"box","text":"SG This designation denotes speculative-grade credit quality. Demand features rated in this category","page_number":174,"box":{"x":69,"y":846,"width":820,"height":11}},{"id":"b8aeb0b3-7923-4962-94de-29d17e6625c1","block_type":"box","text":"may be suppor ted by a liquidity provider that does not have a sufficiently strong shor t-term rating or","page_number":174,"box":{"x":197,"y":861,"width":711,"height":11}},{"id":"c08d1c09-6dfd-4c15-b89e-b41e89d45fe0","block_type":"box","text":"may lack the structural or legal protections.","page_number":174,"box":{"x":197,"y":876,"width":308,"height":11}},{"id":"f6daaeca-7ffb-481f-bb02-1a799d589e38","block_type":"box","text":"A-3","page_number":174,"box":{"x":477,"y":943,"width":23,"height":9}},{"id":"927d71a7-2c45-4d74-b04b-236a768897b1","block_type":"box","text":"NM1026U-5982568-174/232","page_number":174,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"55c52b17-2265-4d88-a83c-56d6b257a27d","block_type":"box","text":"Description of S&P Global Ratings (“S&P”), a Division of S&P Global Inc., Issue Credit Ratings","page_number":175,"box":{"x":69,"y":45,"width":691,"height":11}},{"id":"d97b354c-ad95-4cc7-90b8-fc825565759f","block_type":"box","text":"An S&P issue credit rating is a forward-looking opinion about the creditwor thiness of an obligor with respect to a","page_number":175,"box":{"x":101,"y":67,"width":801,"height":12}},{"id":"a37a703d-815a-4cc6-a097-d8eb5720730a","block_type":"box","text":"specific financial obligation, a specific class of financial obligations, or a specific financial program (including ratings","page_number":175,"box":{"x":69,"y":82,"width":829,"height":12}},{"id":"95975586-5cb4-4a3f-b3cd-abf51c817f56","block_type":"box","text":"on medium-term note programs and commercial paper programs). It takes into consideration the creditwor thiness of","page_number":175,"box":{"x":69,"y":98,"width":831,"height":11}},{"id":"8be6956b-d76b-483c-a06d-f50b84d3dce6","block_type":"box","text":"guarantors, insurers, or other forms of credit enhancement on the obligation and takes into account the currency in","page_number":175,"box":{"x":68,"y":113,"width":823,"height":11}},{"id":"ffaf0439-fc98-4e9b-a9a1-3f14a86040e7","block_type":"box","text":"which the obligation is denominated. The opinion reflects S&P’s view of the obligor’s capacity and willingness to meet","page_number":175,"box":{"x":68,"y":128,"width":841,"height":11}},{"id":"64e80f5f-091d-4d6e-aba0-0e158e16b3f0","block_type":"box","text":"its financial commitments as they come due, and this opinion may assess terms, such as collateral security and","page_number":175,"box":{"x":70,"y":143,"width":801,"height":11}},{"id":"2d3b2292-8313-4660-87f8-b46aeeeeea17","block_type":"box","text":"subordination, which could affect ultimate payment in the event of default.","page_number":175,"box":{"x":69,"y":158,"width":530,"height":11}},{"id":"ee682e07-a90b-47a7-a61d-d2afaf820b56","block_type":"box","text":"Issue credit ratings can be either long-term or shor t-term. Shor t-term issue credit ratings are generally assigned","page_number":175,"box":{"x":102,"y":181,"width":796,"height":11}},{"id":"9cf14052-d06b-4709-b5d8-f6f524d43861","block_type":"box","text":"to those obligations considered shor t-term in the relevant market, typically with an original maturity of no more than","page_number":175,"box":{"x":68,"y":196,"width":825,"height":11}},{"id":"50295c71-d311-43b5-bbee-fb28d2a6afea","block_type":"box","text":"365 days. Shor t-term issue credit ratings are also used to indicate the creditwor thiness of an obligor with respect to","page_number":175,"box":{"x":69,"y":211,"width":832,"height":11}},{"id":"c2153499-15ee-4573-95fd-3abc3fbc4751","block_type":"box","text":"put features on long-term obligations. S&P would typically assign a long-term issue credit rating to an obligation with","page_number":175,"box":{"x":70,"y":226,"width":826,"height":11}},{"id":"3cfdba15-a154-47b9-a19a-a1bc5111bb84","block_type":"box","text":"an original maturity of greater than 365 days. However, the ratings S&P assigns to cer tain instruments may diverge","page_number":175,"box":{"x":69,"y":241,"width":823,"height":11}},{"id":"d71fb345-efce-449b-8b60-85508d23202a","block_type":"box","text":"from these guidelines based on market practices.","page_number":175,"box":{"x":68,"y":256,"width":354,"height":12}},{"id":"f210b6fa-9efb-43f4-a55a-8702971ded74","block_type":"box","text":"Issue credit ratings are based, in varying degrees, on S&P’s analysis of the following considerations:","page_number":175,"box":{"x":102,"y":279,"width":718,"height":11}},{"id":"429ff6af-ad93-45e9-8866-59489a527387","block_type":"box","text":"•","page_number":175,"box":{"x":69,"y":302,"width":6,"height":5}},{"id":"0ab2cdcd-975a-4428-967a-15ea585b101b","block_type":"box","text":"The likelihood of payment—the capacity and willingness of the obligor to meet its financial commitments on an","page_number":175,"box":{"x":101,"y":299,"width":790,"height":11}},{"id":"adf01640-d882-497a-b45d-34cba19a0d12","block_type":"box","text":"obligation in accordance with the terms of the obligation;","page_number":175,"box":{"x":102,"y":314,"width":404,"height":12}},{"id":"359d8614-7203-4776-a009-3aa75df00d10","block_type":"box","text":"•","page_number":175,"box":{"x":69,"y":337,"width":6,"height":5}},{"id":"aabf93f8-59c7-4337-b9dc-a7c0876bb6c2","block_type":"box","text":"The nature and provisions of the financial obligation, and the promise S&P imputes; and","page_number":175,"box":{"x":101,"y":334,"width":629,"height":12}},{"id":"d3adb372-bcc1-4a1c-a150-008986c4760e","block_type":"box","text":"•","page_number":175,"box":{"x":69,"y":357,"width":6,"height":5}},{"id":"abd7355d-cdf1-4581-8aa8-3704b4e75d9c","block_type":"box","text":"The protection afforded by, and relative position of, the financial obligation in the event of a bankruptcy,","page_number":175,"box":{"x":101,"y":355,"width":738,"height":11}},{"id":"7ab98c8e-3ff1-417c-8d8e-65f9092d4e36","block_type":"box","text":"reorganization, or other arrangement under the laws of bankruptcy and other laws affecting creditors’ rights.","page_number":175,"box":{"x":102,"y":370,"width":770,"height":11}},{"id":"b73b11ed-44c3-4a50-94ea-609e1e5702e9","block_type":"box","text":"An issue rating is an assessment of default risk but may incorporate an assessment of relative seniority or","page_number":175,"box":{"x":101,"y":392,"width":763,"height":12}},{"id":"9407f40d-f65c-41e9-80a2-e49821ef3974","block_type":"box","text":"ultimate recovery in the event of default. Junior obligations are typically rated lower than senior obligations, to reflect","page_number":175,"box":{"x":69,"y":407,"width":833,"height":12}},{"id":"82927de8-9bf0-4547-b8d3-e5ce109e3786","block_type":"box","text":"lower priority in bankruptcy, as noted above. (Such differentiation may apply when an entity has both senior and","page_number":175,"box":{"x":70,"y":423,"width":794,"height":11}},{"id":"dc8ba034-e26c-4f4c-882f-d2657c5c9d4e","block_type":"box","text":"subordinated obligations, secured and unsecured obligations, or operating company and holding company","page_number":175,"box":{"x":69,"y":438,"width":754,"height":11}},{"id":"4471b8a5-3172-4ac7-824e-b94714c954c0","block_type":"box","text":"obligations.)","page_number":175,"box":{"x":69,"y":453,"width":86,"height":11}},{"id":"13dccf53-7fa6-4931-b7a3-ed385f18c0f9","block_type":"box","text":"Long-Term Issue Credit Ratings*","page_number":175,"box":{"x":69,"y":483,"width":236,"height":11}},{"id":"a3c21078-8f8c-4125-8a4d-f7339e45824f","block_type":"box","text":"AAA An obligation rated ‘AAA’ has the highest rating assigned by S&P. The obligor’s capacity to meet its","page_number":175,"box":{"x":68,"y":511,"width":833,"height":11}},{"id":"658d1d1d-49cc-4448-a4d2-4f910407fe81","block_type":"box","text":"financial commitments on the obligation is extremely strong.","page_number":175,"box":{"x":196,"y":526,"width":429,"height":11}},{"id":"34257345-8986-40c9-9184-90b26969ed14","block_type":"box","text":"AA An obligation rated ‘AA’ differs from the highest-rated obligations only to a small degree. The","page_number":175,"box":{"x":68,"y":546,"width":788,"height":11}},{"id":"eeef24e7-2872-4dbc-a93e-a08df7938f84","block_type":"box","text":"obligor’s capacity to meet its financial commitments on the obligation is very strong.","page_number":175,"box":{"x":196,"y":561,"width":602,"height":11}},{"id":"ab574748-d4ea-40b3-ac23-791473e7d3ef","block_type":"box","text":"A An obligation rated ‘A’ is somewhat more susceptible to the adverse effects of changes in","page_number":175,"box":{"x":68,"y":581,"width":770,"height":12}},{"id":"ff3f9eb6-0a42-4363-bc9f-df1195b79190","block_type":"box","text":"circumstances and economic conditions than obligations in higher-rated categories. However, the","page_number":175,"box":{"x":196,"y":597,"width":692,"height":11}},{"id":"8ae288dc-6db1-4dcd-bc11-a886bfbc8c43","block_type":"box","text":"obligor’s capacity to meet its financial commitments on the obligation is still strong.","page_number":175,"box":{"x":196,"y":612,"width":598,"height":11}},{"id":"02cc4d28-4dee-48e3-b99e-f9bb24b31a49","block_type":"box","text":"BBB An obligation rated ‘BBB’ exhibits adequate protection parameters. However, adverse economic","page_number":175,"box":{"x":70,"y":632,"width":806,"height":11}},{"id":"8c050cb5-3019-4920-aa39-b8928d42f759","block_type":"box","text":"conditions or changing circumstances are more likely to weaken the obligor’s capacity to meet its","page_number":175,"box":{"x":196,"y":647,"width":694,"height":11}},{"id":"0e9c1097-f397-4648-8eff-18a8d79926e4","block_type":"box","text":"financial commitments on the obligation.","page_number":175,"box":{"x":196,"y":662,"width":289,"height":11}},{"id":"bea592af-70d0-48c9-8826-fa2c2bdc1b3c","block_type":"box","text":"BB,","page_number":175,"box":{"x":70,"y":682,"width":22,"height":11}},{"id":"773530da-122f-48af-b325-6db58943f28b","block_type":"box","text":"B,","page_number":175,"box":{"x":70,"y":697,"width":12,"height":11}},{"id":"e1453776-1d67-41b0-9b6d-53db200f9bc3","block_type":"box","text":"CCC,","page_number":175,"box":{"x":69,"y":712,"width":33,"height":11}},{"id":"e69ee23f-9289-4253-9552-912b1e2428ba","block_type":"box","text":"CC,","page_number":175,"box":{"x":69,"y":728,"width":23,"height":10}},{"id":"036d083d-593c-4357-91ce-11de159017ec","block_type":"box","text":"and C","page_number":175,"box":{"x":69,"y":743,"width":40,"height":9}},{"id":"d5470973-e5c9-407b-b815-8aa2ac3060fc","block_type":"box","text":"Obligations rated ‘BB’, ‘B’, ‘CCC’, ‘CC’, and ‘C’ are regarded as having significant speculative","page_number":175,"box":{"x":196,"y":682,"width":667,"height":11}},{"id":"710715d9-cc65-443b-89f3-de5cfdc23680","block_type":"box","text":"characteristics. ‘BB’ indicates the least degree of speculation and ‘C’ the highest. While such","page_number":175,"box":{"x":196,"y":697,"width":667,"height":12}},{"id":"7695d5f2-cd48-4c02-ac96-7158f4818bb8","block_type":"box","text":"obligations will likely have some quality and protective characteristics, these may be outweighed by","page_number":175,"box":{"x":196,"y":713,"width":707,"height":11}},{"id":"0db3396e-b00c-4600-b69c-c248a74ff6ee","block_type":"box","text":"large uncer tainties or major exposure to adverse conditions.","page_number":175,"box":{"x":197,"y":728,"width":428,"height":11}},{"id":"890748a4-58f8-4e95-9dea-ef0b3b644581","block_type":"box","text":"BB An obligation rated ‘BB’ is less vulnerable to nonpayment than other speculative issues. However, it","page_number":175,"box":{"x":70,"y":763,"width":838,"height":11}},{"id":"55f27c26-01cf-43b4-a3a4-42224cbee4c4","block_type":"box","text":"faces major ongoing uncer tainties or exposure to adverse business, financial, or economic","page_number":175,"box":{"x":196,"y":778,"width":646,"height":11}},{"id":"d57955c9-d107-4010-a770-10e31c87c33a","block_type":"box","text":"conditions that could lead to the obligor’s inadequate capacity to meet its financial commitments","page_number":175,"box":{"x":196,"y":793,"width":692,"height":11}},{"id":"1055d4ea-3d7b-45ef-9fb7-d25596d36d55","block_type":"box","text":"on the obligation.","page_number":175,"box":{"x":196,"y":808,"width":122,"height":11}},{"id":"b50fc1e8-0873-438c-8e10-da205eb7ce65","block_type":"box","text":"B An obligation rated ‘B’ is more vulnerable to nonpayment than obligations rated ‘BB’, but the obligor","page_number":175,"box":{"x":70,"y":828,"width":840,"height":12}},{"id":"8f7a8406-3552-4436-82e3-30066429cc0e","block_type":"box","text":"currently has the capacity to meet its financial commitments on the obligation. Adverse business,","page_number":175,"box":{"x":196,"y":843,"width":695,"height":12}},{"id":"5cd6c8b5-3132-45a0-9a0a-97b37e494c7a","block_type":"box","text":"financial, or economic conditions will likely impair the obligor’s capacity or willingness to meet its","page_number":175,"box":{"x":196,"y":858,"width":691,"height":12}},{"id":"a75c7d00-be94-4b75-9bc7-d8c4fa30f0d8","block_type":"box","text":"financial commitments on the obligation.","page_number":175,"box":{"x":196,"y":874,"width":289,"height":11}},{"id":"08e97b86-9f1f-4625-9dd7-a9d61f60ffb5","block_type":"box","text":"A-4","page_number":175,"box":{"x":477,"y":943,"width":24,"height":9}},{"id":"3a9496b1-ca94-47df-bb0f-96d070163b9b","block_type":"box","text":"NM1026U-5982568-175/232","page_number":175,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"b00f40b3-16d4-4e52-bd22-f0ea0d103d86","block_type":"box","text":"CCC An obligation rated ‘CCC’ is currently vulnerable to nonpayment and is dependent upon favorable","page_number":176,"box":{"x":69,"y":48,"width":816,"height":12}},{"id":"55e8aba9-69b1-4e3b-99c4-b91207e02361","block_type":"box","text":"business, financial, and economic conditions for the obligor to meet its financial commitments on","page_number":176,"box":{"x":196,"y":63,"width":695,"height":12}},{"id":"18baf229-45bb-4ee9-a29e-ca088c2ce295","block_type":"box","text":"the obligation. In the event of adverse business, financial, or economic conditions, the obligor is","page_number":176,"box":{"x":195,"y":79,"width":687,"height":11}},{"id":"a8976cd6-f895-4946-88ad-648e2f152de9","block_type":"box","text":"not likely to have the capacity to meet its financial commitments on the obligation.","page_number":176,"box":{"x":197,"y":94,"width":586,"height":11}},{"id":"9b2f44f5-ee03-4aaa-977c-7802cc282841","block_type":"box","text":"CC An obligation rated ‘CC’ is currently highly vulnerable to nonpayment. The ‘CC’ rating is used when","page_number":176,"box":{"x":69,"y":114,"width":826,"height":11}},{"id":"73c6e343-859a-4835-89c3-d4af1c7e2436","block_type":"box","text":"a default has not yet occurred but S&P expects default to be a vir tual cer tainty, regardless of the","page_number":176,"box":{"x":196,"y":129,"width":692,"height":11}},{"id":"5e7583c9-9909-4a13-aa01-73132a7b583c","block_type":"box","text":"anticipated time to default.","page_number":176,"box":{"x":196,"y":144,"width":191,"height":11}},{"id":"cfbc35f9-1ab1-47af-9c4e-498c4891728e","block_type":"box","text":"C An obligation rated ‘C’ is currently highly vulnerable to nonpayment, and the obligation is expected","page_number":176,"box":{"x":69,"y":164,"width":826,"height":12}},{"id":"fe80a624-f8b3-4384-ab4d-626ed26bc92a","block_type":"box","text":"to have lower relative seniority or lower ultimate recovery compared with obligations that are rated","page_number":176,"box":{"x":195,"y":180,"width":700,"height":11}},{"id":"3178dc3e-428c-449f-85b4-86a8de5390ed","block_type":"box","text":"higher.","page_number":176,"box":{"x":197,"y":195,"width":45,"height":11}},{"id":"6d16c9e8-7f24-4f61-9b39-ba1aa0aa39c3","block_type":"box","text":"D An obligation rated ‘D’ is in default or in breach of an imputed promise. For non-hybrid capital","page_number":176,"box":{"x":70,"y":215,"width":789,"height":11}},{"id":"ba4a3991-b753-4c31-ac3f-3c3dbf233233","block_type":"box","text":"instruments, the ‘D’ rating category is used when payments on an obligation are not made on the","page_number":176,"box":{"x":197,"y":230,"width":695,"height":11}},{"id":"bee9264b-bbbf-4187-aa23-6dd34500ea4a","block_type":"box","text":"date due, unless S&P believes that such payments will be made within five business days in the","page_number":176,"box":{"x":196,"y":245,"width":686,"height":11}},{"id":"41250bcf-2a72-40a8-a1cf-78153e399d73","block_type":"box","text":"absence of a stated grace period or within the earlier of the stated grace period or 30 calendar","page_number":176,"box":{"x":196,"y":260,"width":676,"height":11}},{"id":"03cf2543-4ec9-41b5-bb79-c420501cd477","block_type":"box","text":"days. The ‘D’ rating also will be used upon the filing of a bankruptcy petition or the taking of similar","page_number":176,"box":{"x":196,"y":275,"width":708,"height":11}},{"id":"24264819-32a5-45e0-9399-605a009af34f","block_type":"box","text":"action and where default on an obligation is a vir tual cer tainty, for example due to automatic stay","page_number":176,"box":{"x":196,"y":290,"width":694,"height":12}},{"id":"ffbb2909-b1be-4b1a-851e-f4f8bd4eb7fa","block_type":"box","text":"provisions. A rating on an obligation is lowered to ‘D’ if it is subject to a distressed debt","page_number":176,"box":{"x":197,"y":305,"width":626,"height":12}},{"id":"e7032bda-9ffa-4a2c-bb0d-900ef973d112","block_type":"box","text":"restructuring.","page_number":176,"box":{"x":197,"y":321,"width":92,"height":11}},{"id":"4b259e75-45ab-4024-9512-043bc43dd3b8","block_type":"box","text":"*Ratings from ‘AA’ to ‘CCC’ may be modified by the addition of a plus (+) or minus (-) sign to show relative","page_number":176,"box":{"x":103,"y":341,"width":756,"height":11}},{"id":"a25ede21-6c7d-45f0-bcf1-6c84e799689b","block_type":"box","text":"standing within the rating categories.","page_number":176,"box":{"x":69,"y":356,"width":262,"height":11}},{"id":"f4767ebf-6296-4760-977e-406262302380","block_type":"box","text":"Short-Term Issue Credit Ratings","page_number":176,"box":{"x":68,"y":386,"width":233,"height":11}},{"id":"c64b34fa-d6e9-4721-b2d2-abc1a9f5ff9d","block_type":"box","text":"A-1 A shor t-term obligation rated ‘A-1’ is rated in the highest category by S&P. The obligor’s capacity to","page_number":176,"box":{"x":68,"y":414,"width":833,"height":11}},{"id":"d0835aaa-d96a-45d2-9788-516a36fb8c18","block_type":"box","text":"meet its financial commitments on the obligation is strong. Within this category, cer tain obligations","page_number":176,"box":{"x":197,"y":429,"width":707,"height":11}},{"id":"fe24e913-0a38-4457-912e-7428bcc4555e","block_type":"box","text":"are designated with a plus sign (+). This indicates that the obligor’s capacity to meet its financial","page_number":176,"box":{"x":196,"y":444,"width":691,"height":11}},{"id":"42cddf8e-4a0c-4555-9579-b94dffc68ec4","block_type":"box","text":"commitments on these obligations is extremely strong.","page_number":176,"box":{"x":196,"y":459,"width":390,"height":11}},{"id":"f2e8bc50-d707-4a13-8072-ee19418a3dbc","block_type":"box","text":"A-2 A shor t-term obligation rated ‘A-2’ is somewhat more susceptible to the adverse effects of changes","page_number":176,"box":{"x":68,"y":479,"width":837,"height":12}},{"id":"050b955b-5c3b-4c6b-b133-d70b1fc83d89","block_type":"box","text":"in circumstances and economic conditions than obligations in higher rating categories. However,","page_number":176,"box":{"x":197,"y":495,"width":684,"height":11}},{"id":"bd7da72d-0178-4f22-af33-01c4b8993e68","block_type":"box","text":"the obligor’s capacity to meet its financial commitments on the obligation is satisfactory.","page_number":176,"box":{"x":195,"y":509,"width":634,"height":12}},{"id":"b656ea2d-5d44-4766-97a4-ff2f3dee11b8","block_type":"box","text":"A-3 A shor t-term obligation rated ‘A-3’ exhibits adequate protection parameters. However, adverse","page_number":176,"box":{"x":68,"y":530,"width":798,"height":11}},{"id":"f7c4adbd-c446-4a65-a3f9-ca494de77054","block_type":"box","text":"economic conditions or changing circumstances are more likely to weaken an obligor’s capacity to","page_number":176,"box":{"x":196,"y":545,"width":699,"height":11}},{"id":"52f56bc5-04a1-4982-9d60-8c7119263311","block_type":"box","text":"meet its financial commitments on the obligation.","page_number":176,"box":{"x":197,"y":560,"width":351,"height":11}},{"id":"00744e4b-91b3-4238-9972-9ed3f74e8ec9","block_type":"box","text":"B A shor t-term obligation rated ‘B’ is regarded as vulnerable and has significant speculative","page_number":176,"box":{"x":70,"y":580,"width":765,"height":11}},{"id":"f2c05064-0cd7-4a7c-9f54-0edabdf28562","block_type":"box","text":"characteristics. The obligor currently has the capacity to meet its financial commitments; however,","page_number":176,"box":{"x":196,"y":595,"width":700,"height":11}},{"id":"be9ade21-d7d8-4f9d-95ad-a3782654fd19","block_type":"box","text":"it faces major ongoing uncer tainties that could lead to the obligor’s inadequate capacity to meet its","page_number":176,"box":{"x":197,"y":610,"width":708,"height":12}},{"id":"4daef223-367b-4861-94b5-c9f1f9056d1d","block_type":"box","text":"financial commitments.","page_number":176,"box":{"x":196,"y":625,"width":165,"height":9}},{"id":"77e3f3ca-1d0a-4dbc-a3e4-523524f9a296","block_type":"box","text":"C A shor t-term obligation rated ‘C’ is currently vulnerable to nonpayment and is dependent upon","page_number":176,"box":{"x":69,"y":646,"width":796,"height":11}},{"id":"a073f1fb-ee4c-4625-9b42-e83697324c65","block_type":"box","text":"favorable business, financial, and economic conditions for the obligor to meet its financial","page_number":176,"box":{"x":196,"y":661,"width":641,"height":11}},{"id":"cea665dc-70b0-4e96-96f6-f19d7157979e","block_type":"box","text":"commitments on the obligation.","page_number":176,"box":{"x":196,"y":676,"width":224,"height":11}},{"id":"39328fdd-4a13-4877-a904-b482e85fff7e","block_type":"box","text":"D A shor t-term obligation rated ‘D’ is in default or in breach of an imputed promise. For non-hybrid","page_number":176,"box":{"x":70,"y":696,"width":808,"height":11}},{"id":"fd11cd3a-4041-405c-a9af-0e5e0a0b32d8","block_type":"box","text":"capital instruments, the ‘D’ rating category is used when payments on an obligation are not made","page_number":176,"box":{"x":196,"y":711,"width":698,"height":11}},{"id":"b816f763-c5c5-4224-8e62-6ba7209b7b99","block_type":"box","text":"on the date due, unless S&P believes that such payments will be made within any stated grace","page_number":176,"box":{"x":196,"y":726,"width":678,"height":12}},{"id":"20366132-c244-4f38-bbb5-dbe0cc31f350","block_type":"box","text":"period. However, any stated grace period longer than five business days will be treated as five","page_number":176,"box":{"x":197,"y":741,"width":669,"height":12}},{"id":"b94231e5-4e6d-4c8f-b992-7ba7064a8704","block_type":"box","text":"business days. The ‘D’ rating also will be used upon the filing of a bankruptcy petition or the taking","page_number":176,"box":{"x":196,"y":756,"width":707,"height":12}},{"id":"8c51b33c-56f0-474e-9271-f2490cd0e36f","block_type":"box","text":"of a similar action and where default on an obligation is a vir tual cer tainty, for example due to","page_number":176,"box":{"x":196,"y":772,"width":669,"height":11}},{"id":"f49416f9-ed45-4bcc-aebd-60473d974861","block_type":"box","text":"automatic stay provisions. A rating on an obligation is lowered to ‘D’ if it is subject to a distressed","page_number":176,"box":{"x":196,"y":787,"width":700,"height":11}},{"id":"dc39275a-c169-4c3e-be9a-49167910437d","block_type":"box","text":"debt restructuring.","page_number":176,"box":{"x":196,"y":802,"width":130,"height":11}},{"id":"87c829fc-6309-490b-b4b7-ba923e8dab58","block_type":"box","text":"Description of S&P’s Municipal Short-Term Note Ratings","page_number":176,"box":{"x":69,"y":830,"width":411,"height":11}},{"id":"b56d33c4-1ca4-45dd-b115-4ba630c3da9f","block_type":"box","text":"An S&P U.S. municipal note rating reflects S&P’s opinion about the liquidity factors and market access risks","page_number":176,"box":{"x":101,"y":852,"width":772,"height":11}},{"id":"96f2bdd9-b05e-4579-be1d-bab43ac60be6","block_type":"box","text":"unique to the notes. Notes due in three years or less will likely receive a note rating. Notes with an original maturity","page_number":176,"box":{"x":69,"y":868,"width":823,"height":11}},{"id":"0f639fef-85e7-4de8-a3f4-4d333cbcc72e","block_type":"box","text":"of more than three years will most likely receive a long-term debt rating. In determining which type of rating, if any, to","page_number":176,"box":{"x":69,"y":882,"width":832,"height":12}},{"id":"f5dd36c9-2216-4901-abd5-2db446c5f054","block_type":"box","text":"assign, S&P’s analysis will review the following considerations:","page_number":176,"box":{"x":69,"y":898,"width":447,"height":11}},{"id":"b81ae937-1438-4ed5-bd4b-9e20bbfd56b2","block_type":"box","text":"A-5","page_number":176,"box":{"x":477,"y":943,"width":24,"height":9}},{"id":"c2dda2b3-8367-4b44-bc88-dbfac820aa8d","block_type":"box","text":"NM1026U-5982568-176/232","page_number":176,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"352949d1-8937-4c29-b739-0aa545e96a61","block_type":"box","text":"•","page_number":177,"box":{"x":69,"y":48,"width":6,"height":4}},{"id":"5932fc63-0e3a-4cee-aa0f-65538fd3b93c","block_type":"box","text":"Amor tization schedule—the larger the final maturity relative to other maturities, the more likely it will be treated","page_number":177,"box":{"x":101,"y":45,"width":796,"height":11}},{"id":"c02c1a5d-5e8d-48fb-bf05-7758a115b919","block_type":"box","text":"as a note; and","page_number":177,"box":{"x":102,"y":60,"width":101,"height":10}},{"id":"1f6e14de-2716-422c-be1f-dcf951a2a702","block_type":"box","text":"•","page_number":177,"box":{"x":69,"y":83,"width":6,"height":4}},{"id":"28948264-4425-47cc-988b-366689e6c160","block_type":"box","text":"Source of payment—the more dependent the issue is on the market for its refinancing, the more likely it will be","page_number":177,"box":{"x":102,"y":80,"width":794,"height":11}},{"id":"f542be9c-7f0d-4eb4-866c-35e17ce49caf","block_type":"box","text":"treated as a note.","page_number":177,"box":{"x":101,"y":95,"width":127,"height":9}},{"id":"eb66254a-41a5-4ebf-99e2-394f5bee379e","block_type":"box","text":"S&P’s municipal shor t-term note rating symbols are as follows:","page_number":177,"box":{"x":102,"y":118,"width":448,"height":11}},{"id":"1c86138d-1b9d-40a6-a736-f959ea000742","block_type":"box","text":"SP-1 Strong capacity to pay principal and interest. An issue determined to possess a very strong","page_number":177,"box":{"x":69,"y":146,"width":779,"height":11}},{"id":"926490ae-c0c9-4669-8241-3c835eb0855d","block_type":"box","text":"capacity to pay debt service is given a plus (+) designation.","page_number":177,"box":{"x":196,"y":161,"width":422,"height":11}},{"id":"224dfef7-8f3e-49b1-9ae4-a08ecaa90172","block_type":"box","text":"SP-2 Satisfactory capacity to pay principal and interest, with some vulnerability to adverse financial and","page_number":177,"box":{"x":69,"y":181,"width":825,"height":11}},{"id":"624e1c63-8679-4c47-a7d3-367b96d24375","block_type":"box","text":"economic changes over the term of the notes.","page_number":177,"box":{"x":196,"y":196,"width":327,"height":11}},{"id":"5dc855d9-21b6-4e0e-b48f-e7b858c5eb6a","block_type":"box","text":"SP-3 Speculative capacity to pay principal and interest.","page_number":177,"box":{"x":69,"y":216,"width":479,"height":11}},{"id":"dbbaa2a1-e423-44a0-bc3a-195fca3ef229","block_type":"box","text":"D ‘D’ is assigned upon failure to pay the note when due, completion of a distressed debt","page_number":177,"box":{"x":70,"y":236,"width":745,"height":11}},{"id":"4b9ef013-f466-45e4-b9a3-6d87d7792c20","block_type":"box","text":"restructuring, or the filing of a bankruptcy petition or the taking of similar action and where default","page_number":177,"box":{"x":197,"y":251,"width":699,"height":12}},{"id":"e7577795-509c-4214-8be0-d858a8ba8fd1","block_type":"box","text":"on an obligation is a vir tual cer tainty, for example due to automatic stay provisions.","page_number":177,"box":{"x":196,"y":266,"width":594,"height":12}},{"id":"fc034e71-2f38-48f8-b3e6-8d0e6c87adfe","block_type":"box","text":"Description of Fitch Ratings’ (“Fitch”) Credit Ratings Scales","page_number":177,"box":{"x":69,"y":294,"width":442,"height":11}},{"id":"d6c98175-064c-49c2-9373-521b293ac56f","block_type":"box","text":"Fitch publishes credit ratings that are forward-looking opinions on the relative ability of an entity or obligation to","page_number":177,"box":{"x":102,"y":317,"width":793,"height":11}},{"id":"114e7f97-42c7-4fb1-9e01-e925dc0184c0","block_type":"box","text":"meet financial commitments. Issuer default ratings (IDRs) are assigned to corporations, sovereign entities, financial","page_number":177,"box":{"x":69,"y":332,"width":826,"height":11}},{"id":"332cece2-1308-45c2-90bc-eb4f1440ea9c","block_type":"box","text":"institutions such as banks, leasing companies and insurers, and public finance entities (local and regional","page_number":177,"box":{"x":70,"y":347,"width":756,"height":11}},{"id":"48478d14-ae6c-4099-8a8f-759d37bb4aa7","block_type":"box","text":"governments). Issue level ratings are also assigned, often include an expectation of recovery and may be notched","page_number":177,"box":{"x":68,"y":362,"width":813,"height":11}},{"id":"2088c47e-91e3-46c6-bfd0-f3ac7284c36e","block_type":"box","text":"above or below the issuer level rating. Issue ratings are assigned to secured and unsecured debt securities, loans,","page_number":177,"box":{"x":69,"y":377,"width":819,"height":12}},{"id":"aeda8cae-c881-474b-876b-139f65c54794","block_type":"box","text":"preferred stock and other instruments, Structured finance ratings are issue ratings to securities backed by","page_number":177,"box":{"x":70,"y":392,"width":760,"height":12}},{"id":"a7c9e205-08a1-4ed1-b67a-7bbf8eba4d55","block_type":"box","text":"receivables or other financial assets that consider the obligations’ relative vulnerability to default.","page_number":177,"box":{"x":69,"y":407,"width":694,"height":12}},{"id":"d61399c3-1510-4851-a496-77130a8ac4c0","block_type":"box","text":"Fitch’s credit ratings relating to issuers are an opinion on the relative ability of an entity to meet financial","page_number":177,"box":{"x":102,"y":430,"width":747,"height":11}},{"id":"b6205e32-8b9e-4e51-a694-cf4acaa96abf","block_type":"box","text":"commitments, such as interest, preferred dividends, repayment of principal, insurance claims or counterpar ty","page_number":177,"box":{"x":69,"y":445,"width":782,"height":11}},{"id":"2c4e6494-e072-4772-b722-355e3ecef234","block_type":"box","text":"obligations. Credit ratings relating to securities and obligations of an issuer can include a recovery expectation.","page_number":177,"box":{"x":69,"y":460,"width":793,"height":12}},{"id":"057b2c0d-05f4-48b2-b003-82adb8b14238","block_type":"box","text":"Credit ratings are used by investors as indications of the likelihood of receiving the money owed to them in","page_number":177,"box":{"x":69,"y":475,"width":761,"height":12}},{"id":"70e18346-81a9-4282-83c7-a4333eace2f3","block_type":"box","text":"accordance with the terms on which they invested. The agency’s credit ratings cover the global spectrum of","page_number":177,"box":{"x":69,"y":491,"width":766,"height":11}},{"id":"f95cbcb1-e25a-4587-a497-1af73f802970","block_type":"box","text":"corporate, sovereign financial, bank, insurance, and public finance entities (including supranational and sub-national","page_number":177,"box":{"x":69,"y":506,"width":827,"height":11}},{"id":"a3e002f3-d9c9-4bbf-981f-65c9048dc18b","block_type":"box","text":"entities) and the securities or other obligations they issue, as well as structured finance securities backed by","page_number":177,"box":{"x":69,"y":521,"width":779,"height":11}},{"id":"fe8e1c24-cc27-4376-b7df-5a1c29db61cf","block_type":"box","text":"receivables or other financial assets.","page_number":177,"box":{"x":69,"y":536,"width":262,"height":9}},{"id":"bb67ecda-3ff9-4684-a78f-0ebf3af41b9c","block_type":"box","text":"The terms “investment grade” and “speculative grade” have established themselves over time as shor thand to","page_number":177,"box":{"x":101,"y":559,"width":794,"height":11}},{"id":"a572a74f-cf46-4af8-a014-b457ef72ec23","block_type":"box","text":"describe the categories ‘AAA’ to ‘BBB’ (investment grade) and ‘BB’ to ‘D’ (speculative grade). The terms investment","page_number":177,"box":{"x":69,"y":574,"width":826,"height":11}},{"id":"609b9f06-e9d4-4864-a57a-18a34ec8f46e","block_type":"box","text":"grade and speculative grade are market conventions and do not imply any recommendation or endorsement of a","page_number":177,"box":{"x":68,"y":589,"width":800,"height":11}},{"id":"b14f2c67-203b-4c8d-904c-01a701b419f7","block_type":"box","text":"specific security for investment purposes. Investment grade categories indicate relatively low to moderate credit risk,","page_number":177,"box":{"x":69,"y":604,"width":832,"height":11}},{"id":"406389d8-06ca-43c8-966c-f045998e00a3","block_type":"box","text":"while ratings in the speculative categories either signal a higher level of credit risk or that a default has already","page_number":177,"box":{"x":68,"y":619,"width":793,"height":11}},{"id":"b1adbba1-4d5f-412e-b3c7-8dbb1d52bb6c","block_type":"box","text":"occurred.","page_number":177,"box":{"x":69,"y":634,"width":65,"height":9}},{"id":"9277a121-9c2f-4b0f-a873-3702d9035a4a","block_type":"box","text":"Fitch may also include issues relating to a rated issuer that are not and have not been rated on its web page.","page_number":177,"box":{"x":102,"y":657,"width":779,"height":11}},{"id":"6531fa09-189a-4369-bd0d-139b9dd347f7","block_type":"box","text":"Such issues are also denoted as ‘NR’.","page_number":177,"box":{"x":69,"y":672,"width":274,"height":9}},{"id":"c1d57bd8-b55a-47c4-be0c-e6496b85f99d","block_type":"box","text":"Credit ratings express risk in relative rank order, which is to say they are ordinal measures of credit risk and are","page_number":177,"box":{"x":102,"y":695,"width":797,"height":11}},{"id":"332cc86e-bc9c-436d-82c1-f5a040175744","block_type":"box","text":"not predictive of a specific frequency of default or loss.","page_number":177,"box":{"x":69,"y":710,"width":391,"height":11}},{"id":"eb3dfa4f-d775-41e0-ba47-0f054b058a5d","block_type":"box","text":"Fitch’s credit ratings do not directly address any risk other than credit risk. In par ticular, ratings do not deal with","page_number":177,"box":{"x":102,"y":733,"width":798,"height":11}},{"id":"bf187bb4-685f-46a5-a99e-3c43ddba2140","block_type":"box","text":"the risk of a market value loss on a rated security due to changes in interest rates, liquidity and other market","page_number":177,"box":{"x":68,"y":748,"width":780,"height":11}},{"id":"480ca856-718d-4fac-90ac-d111a1a7093f","block_type":"box","text":"considerations. However, in terms of payment obligation on the rated liability, market risk may be considered to the","page_number":177,"box":{"x":69,"y":763,"width":821,"height":11}},{"id":"ab269ac7-31e7-46f9-8ab4-945a1bd8c10c","block_type":"box","text":"extent that it influences the ability of an issuer to pay upon a commitment.","page_number":177,"box":{"x":69,"y":778,"width":531,"height":11}},{"id":"f1f45a16-9f28-432b-b2b4-884ca1b2f408","block_type":"box","text":"Ratings nonetheless do not reflect market risk to the extent that they influence the size or other conditionality of","page_number":177,"box":{"x":102,"y":801,"width":801,"height":11}},{"id":"ddd69d2b-9d43-4747-9c05-63df2ff34f71","block_type":"box","text":"the obligation to pay upon a commitment (for example, in the case of index-linked bonds).","page_number":177,"box":{"x":68,"y":816,"width":639,"height":11}},{"id":"bfd5eb78-3e64-4852-a94d-7b6d4ca3b7e7","block_type":"box","text":"In the default components of ratings assigned to individual obligations or instruments, the agency typically rates","page_number":177,"box":{"x":102,"y":838,"width":799,"height":12}},{"id":"7ea8b5b3-9857-4026-a7ed-8165cfa29df6","block_type":"box","text":"to the likelihood of non-payment or default in accordance with the terms of that instrument’s documentation. In","page_number":177,"box":{"x":68,"y":853,"width":794,"height":12}},{"id":"5dda1bc9-4473-40d7-ae5a-f27fae117c41","block_type":"box","text":"limited cases, Fitch may include additional considerations (","page_number":177,"box":{"x":70,"y":869,"width":420,"height":11}},{"id":"599ebd12-c953-49f8-940a-66e78a25e350","block_type":"box","text":"i.e.","page_number":177,"box":{"x":492,"y":869,"width":20,"height":9}},{"id":"0fc4e8f3-51f6-4e13-8be6-ca0a59fc19b4","block_type":"box","text":"rate to a higher or lower standard than that implied in","page_number":177,"box":{"x":519,"y":869,"width":380,"height":11}},{"id":"b232287e-65b9-45e9-a449-0793604d7c8c","block_type":"box","text":"the obligation’s documentation).","page_number":177,"box":{"x":68,"y":884,"width":230,"height":11}},{"id":"730e75d8-93e9-4c64-b1e1-5c3d9ef3c2df","block_type":"box","text":"A-6","page_number":177,"box":{"x":477,"y":943,"width":23,"height":9}},{"id":"5ffa7390-3412-4daa-b707-86cfc8e318d4","block_type":"box","text":"NM1026U-5982568-177/232","page_number":177,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"90d30ffd-9061-4c15-b504-573a5727b2e5","block_type":"box","text":"The primary credit rating scales can be used to provide a rating of privately issued obligations or cer tain note","page_number":178,"box":{"x":101,"y":45,"width":779,"height":11}},{"id":"21c71cbd-85e7-4d7a-8040-bda479b81f8f","block_type":"box","text":"issuance programs or for private ratings. In this case the rating is not published, but only provided to the issuer or its","page_number":178,"box":{"x":70,"y":60,"width":835,"height":11}},{"id":"25ffa33f-a617-4618-b242-9ed5160d8b87","block_type":"box","text":"agents in the form of a rating letter.","page_number":178,"box":{"x":69,"y":75,"width":253,"height":11}},{"id":"ea0d6163-eec5-4f84-9501-6ac506385dff","block_type":"box","text":"The primary credit rating scales may also be used to provide ratings for a more narrow scope, including interest","page_number":178,"box":{"x":101,"y":98,"width":797,"height":11}},{"id":"72a031c7-6d9f-4da6-a14c-2cf38e764377","block_type":"box","text":"strips and return of principal or in other forms of opinions such as credit opinions or rating assessment services.","page_number":178,"box":{"x":69,"y":113,"width":806,"height":11}},{"id":"5748c520-17ba-4561-ac91-e3c036f4996a","block_type":"box","text":"Credit opinions are either a notch- or category-specific view using the primary rating scale and omit one or more","page_number":178,"box":{"x":69,"y":128,"width":796,"height":11}},{"id":"f373ba36-dce1-45de-820b-a72772084f3b","block_type":"box","text":"characteristics of a full rating or meet them to a different standard. Credit opinions will be indicated using a lower","page_number":178,"box":{"x":69,"y":143,"width":811,"height":11}},{"id":"a447251a-6efa-45a4-8cd1-13a2e062694b","block_type":"box","text":"case letter symbol combined with either an ‘*’ (","page_number":178,"box":{"x":69,"y":158,"width":340,"height":11}},{"id":"fec48cc4-b1c8-4763-9910-480c20fc1093","block_type":"box","text":"e.g.","page_number":178,"box":{"x":410,"y":160,"width":25,"height":9}},{"id":"8758a951-ad2a-4327-adbe-9ceff4c20274","block_type":"box","text":"‘bbb+*’) or (cat) suffix to denote the opinion status. Credit","page_number":178,"box":{"x":443,"y":158,"width":418,"height":11}},{"id":"352bef73-0271-4138-a035-f0f08b6f5a11","block_type":"box","text":"opinions will be point-in-time typically but may be monitored if the analytical group believes information will be","page_number":178,"box":{"x":69,"y":173,"width":780,"height":11}},{"id":"72d39406-0ce3-473e-8af7-e3fc3e7a996f","block_type":"box","text":"sufficiently available. Rating assessment services are a notch-specific view using the primary rating scale of how an","page_number":178,"box":{"x":69,"y":188,"width":827,"height":12}},{"id":"5a9f0cea-11e7-4bf6-93e7-4c7fb864ba71","block_type":"box","text":"existing or potential rating may be changed by a given set of hypothetical circumstances. While credit opinions and","page_number":178,"box":{"x":69,"y":203,"width":816,"height":12}},{"id":"1b920547-f508-4754-bb8b-d3af53b735c0","block_type":"box","text":"rating assessment services are point-in-time and are not monitored, they may have a directional watch or outlook","page_number":178,"box":{"x":69,"y":219,"width":808,"height":11}},{"id":"23fef0e3-5e3e-4a62-8603-9db89cc15539","block_type":"box","text":"assigned, which can signify the trajectory of the credit profile.","page_number":178,"box":{"x":69,"y":234,"width":437,"height":11}},{"id":"9f39bc5f-cfa5-4a78-a2f7-80b69415978d","block_type":"box","text":"Description of Fitch’s Long-Term Corporate Finance Obligations Rating Scales","page_number":178,"box":{"x":69,"y":264,"width":567,"height":11}},{"id":"64429de5-1e9b-42a4-97bb-c53e86c01bb7","block_type":"box","text":"Ratings of individual securities or financial obligations of a corporate issuer address relative vulnerability to","page_number":178,"box":{"x":102,"y":286,"width":763,"height":12}},{"id":"10623f99-a227-42ed-a0cf-925dabcbb2a7","block_type":"box","text":"default on an ordinal scale. In addition, for financial obligations in corporate finance, a measure of recovery given","page_number":178,"box":{"x":69,"y":302,"width":807,"height":11}},{"id":"3548c03e-6bd0-436d-9a8b-4679c3ecd21d","block_type":"box","text":"default on that liability is also included in the rating assessment. This notably applies to covered bonds ratings, which","page_number":178,"box":{"x":69,"y":317,"width":840,"height":11}},{"id":"a1cd9929-7461-4e31-9de7-5740eeda9180","block_type":"box","text":"incorporate both an indication of the probability of default and of the recovery given a default of this debt instrument.","page_number":178,"box":{"x":70,"y":332,"width":833,"height":11}},{"id":"46b60925-4b7d-4e8c-a92f-a5e402faba8f","block_type":"box","text":"On the contrary, Ratings of debtor-in-possession (“DIP”) obligations incorporate the expectation of full repayment.","page_number":178,"box":{"x":69,"y":347,"width":807,"height":11}},{"id":"fef65b03-f74d-4757-8eba-00b1888f941f","block_type":"box","text":"The relationship between the issuer scale and obligation scale assumes a generic historical average recovery.","page_number":178,"box":{"x":101,"y":370,"width":784,"height":11}},{"id":"61375ea8-8f27-48e1-8087-1633bc0682a7","block_type":"box","text":"Individual obligations can be assigned ratings higher, lower, or the same as that entity’s issuer rating or issuer","page_number":178,"box":{"x":70,"y":385,"width":787,"height":11}},{"id":"67757b56-5d8f-413f-b335-e3c8e9a5126e","block_type":"box","text":"default rating (“IDR”), based on their relative ranking, relative vulnerability to default or based on explicit Recovery","page_number":178,"box":{"x":69,"y":400,"width":813,"height":11}},{"id":"a2a7e608-367c-404e-bd26-54de2ab12a34","block_type":"box","text":"Ratings.","page_number":178,"box":{"x":70,"y":415,"width":55,"height":11}},{"id":"ae77c380-f032-4a84-9c40-3728b0f7f62e","block_type":"box","text":"As a result, individual obligations of entities, such as corporations, are assigned ratings higher, lower, or the","page_number":178,"box":{"x":101,"y":438,"width":772,"height":11}},{"id":"b5e8fb2e-f80a-4f4e-857b-c3e4019950cb","block_type":"box","text":"same as that entity’s issuer rating or IDR, except DIP obligation ratings that are not based off an IDR. At the lower","page_number":178,"box":{"x":69,"y":453,"width":815,"height":11}},{"id":"707b9a3b-5949-4b43-8a0c-743e47a245f6","block_type":"box","text":"end of the ratings scale, Fitch publishes explicit Recovery Ratings in many cases to complement issuer and","page_number":178,"box":{"x":69,"y":468,"width":766,"height":11}},{"id":"b0756d4f-005a-4198-9e05-2597c859f424","block_type":"box","text":"obligation ratings.","page_number":178,"box":{"x":69,"y":483,"width":125,"height":11}},{"id":"b9e54536-63cf-4a43-840c-c12660ac7503","block_type":"box","text":"Fitch long-term obligations rating scales are as follows:","page_number":178,"box":{"x":102,"y":506,"width":390,"height":11}},{"id":"07d9ea7c-ba6a-4eef-ac4f-d53eb1312900","block_type":"box","text":"AAA Highest Credit Quality. ‘AAA’ ratings denote the lowest expectation of default risk. They are","page_number":178,"box":{"x":68,"y":533,"width":774,"height":12}},{"id":"679438a5-3687-4260-bdd8-621c965cd1e9","block_type":"box","text":"assigned only in cases of exceptionally strong capacity for payment of financial commitments. This","page_number":178,"box":{"x":196,"y":549,"width":703,"height":11}},{"id":"f720f853-666e-4f87-bcc9-f95caa02582f","block_type":"box","text":"capacity is highly unlikely to be adversely affected by foreseeable events.","page_number":178,"box":{"x":196,"y":564,"width":521,"height":11}},{"id":"ace44d2a-ef26-4bdb-b1c8-0a6a76c040b6","block_type":"box","text":"AA Very High Credit Quality. ‘AA’ ratings denote expectations of very low default risk. They indicate very","page_number":178,"box":{"x":68,"y":584,"width":838,"height":11}},{"id":"1321a92c-22dc-4dda-96e9-1143361091f2","block_type":"box","text":"strong capacity for payment of financial commitments. This capacity is not significantly vulnerable","page_number":178,"box":{"x":196,"y":599,"width":694,"height":11}},{"id":"5f0a49f1-d6a3-46dc-905c-61015f6ec624","block_type":"box","text":"to foreseeable events.","page_number":178,"box":{"x":195,"y":614,"width":159,"height":9}},{"id":"a63326e4-fe2e-4165-af09-5095065e50c3","block_type":"box","text":"A High Credit Quality. ‘A’ ratings denote expectations of low default risk. The capacity for payment of","page_number":178,"box":{"x":68,"y":634,"width":828,"height":12}},{"id":"04381eb5-9e99-46af-be27-e5a04ee0947f","block_type":"box","text":"financial commitments is considered strong. This capacity may, never theless, be more vulnerable","page_number":178,"box":{"x":196,"y":649,"width":695,"height":12}},{"id":"bf2df840-b444-4fdb-a37d-6a350bbc75cf","block_type":"box","text":"to adverse business or economic conditions than is the case for higher ratings.","page_number":178,"box":{"x":195,"y":664,"width":565,"height":12}},{"id":"27a23748-a078-4c61-ac44-02348bb20fb8","block_type":"box","text":"BBB Good Credit Quality. ‘BBB’ ratings indicate that expectations of default risk are currently low. The","page_number":178,"box":{"x":70,"y":685,"width":814,"height":11}},{"id":"fdfc3d69-fd35-4b27-a04a-960d787c61df","block_type":"box","text":"capacity for payment of financial commitments is considered adequate, but adverse business or","page_number":178,"box":{"x":196,"y":700,"width":686,"height":11}},{"id":"da85066a-7ec3-4842-9d4f-a1d39d34281d","block_type":"box","text":"economic conditions are more likely to impair this capacity.","page_number":178,"box":{"x":196,"y":715,"width":420,"height":11}},{"id":"cc2b50e1-a01a-4510-8046-6f73ada03954","block_type":"box","text":"BB Speculative. ‘BB’ ratings indicate an elevated vulnerability to default risk, par ticularly in the event of","page_number":178,"box":{"x":70,"y":735,"width":839,"height":11}},{"id":"57adeb5a-1265-4d4b-b0a8-15c7a0d0b6f3","block_type":"box","text":"adverse changes in business or economic conditions over time; however, business or financial","page_number":178,"box":{"x":196,"y":750,"width":672,"height":11}},{"id":"01f5a1ca-b619-48d9-a92d-6bcdb27e612f","block_type":"box","text":"flexibility exists that suppor ts the servicing of financial commitments.","page_number":178,"box":{"x":196,"y":765,"width":495,"height":12}},{"id":"e334b5a2-766f-4cb3-a706-1b21598e8bad","block_type":"box","text":"B Highly Speculative. ‘B’ ratings indicate that material default risk is present, but a limited margin of","page_number":178,"box":{"x":70,"y":785,"width":828,"height":12}},{"id":"6d30e3bd-5b8d-4280-902d-0ef77def20a5","block_type":"box","text":"safety remains. Financial commitments are currently being met; however, capacity for continued","page_number":178,"box":{"x":196,"y":801,"width":682,"height":11}},{"id":"877fee8a-5cde-4315-84ce-66f31948e71a","block_type":"box","text":"payment is vulnerable to deterioration in the business and economic environment.","page_number":178,"box":{"x":197,"y":816,"width":584,"height":11}},{"id":"531966f9-0b8a-4479-a6f8-3c29d2915479","block_type":"box","text":"CCC Substantial Credit Risk. ‘CCC’ ratings indicate very low margin for safety. Default is a real","page_number":178,"box":{"x":69,"y":836,"width":764,"height":11}},{"id":"1481a05e-f7d0-49e3-902c-99f84f66e745","block_type":"box","text":"possibility.","page_number":178,"box":{"x":197,"y":851,"width":72,"height":11}},{"id":"2bc0c920-78de-40a1-b7bb-aa60884014b8","block_type":"box","text":"CC Very High Levels of Credit Risk. ‘CC’ ratings indicate default of some kind appears probable.","page_number":178,"box":{"x":69,"y":871,"width":784,"height":11}},{"id":"75905f84-3041-4eba-b845-182b09606d33","block_type":"box","text":"C Exceptionally High Levels of Credit Risk. ‘C’ ratings indicate default or default-like process has","page_number":178,"box":{"x":69,"y":891,"width":798,"height":12}},{"id":"63c9eb56-2d70-4142-8eb8-5f196152405d","block_type":"box","text":"begun, or for a closed funding vehicle, payment capacity is irrevocably impaired.","page_number":178,"box":{"x":196,"y":906,"width":569,"height":12}},{"id":"57f1658b-017d-48ae-a868-d735937519c5","block_type":"box","text":"A-7","page_number":178,"box":{"x":477,"y":943,"width":23,"height":9}},{"id":"d95313d1-d0e0-43b2-bc0e-088b06e195bd","block_type":"box","text":"NM1026U-5982568-178/232","page_number":178,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"39d820f7-68e0-427e-b9a7-cbf2f8b9cd20","block_type":"box","text":"RD Restricted Default. ‘RD’ ratings indicate an issuer that in Fitch’s opinion has experienced an","page_number":179,"box":{"x":70,"y":48,"width":782,"height":12}},{"id":"e6fc1384-ffac-4994-a1e7-148350644a78","block_type":"box","text":"uncured payment default or distressed debt exchange on a bond, loan or other material financial","page_number":179,"box":{"x":197,"y":63,"width":686,"height":12}},{"id":"19da8859-b1ac-4c0e-bf54-319ddf063c46","block_type":"box","text":"obligation, but has not entered into bankruptcy filings, administration, receivership, liquidation, or","page_number":179,"box":{"x":196,"y":79,"width":696,"height":11}},{"id":"f141f980-6972-491d-8e52-65f65f920695","block_type":"box","text":"other formal winding-up procedure, and has not otherwise ceased operating.","page_number":179,"box":{"x":196,"y":94,"width":544,"height":11}},{"id":"19b1c900-e09a-486f-aa1b-c2dabae32ab1","block_type":"box","text":"D Default. ‘D’ ratings indicate an issuer that in Fitch’s opinion has entered into bankruptcy filings,","page_number":179,"box":{"x":70,"y":114,"width":807,"height":11}},{"id":"a24699ec-d08c-46fc-bfb1-bf5246aaf187","block_type":"box","text":"administration, receivership, liquidation or other formal winding-up procedure or that has otherwise","page_number":179,"box":{"x":196,"y":129,"width":705,"height":11}},{"id":"26cb6ff5-1662-460e-9e55-d456d3e5cb7f","block_type":"box","text":"ceased business and debt is still outstanding.","page_number":179,"box":{"x":196,"y":144,"width":328,"height":11}},{"id":"b5928074-ddd4-4863-b9a9-2da8bbe086c6","block_type":"box","text":"Within rating categories, Fitch may use modifiers. The modifiers “+” or “-” may be appended to a rating to denote","page_number":179,"box":{"x":101,"y":164,"width":808,"height":12}},{"id":"2b510bfa-23e0-4490-becf-b10285390dff","block_type":"box","text":"relative status within major rating categories.","page_number":179,"box":{"x":69,"y":180,"width":320,"height":11}},{"id":"47a6bc90-0bf0-4690-ae68-f7f2bdda07c2","block_type":"box","text":"For example, the rating category ‘AA’ has three notch-specific rating levels (‘AA+’; ‘AA’; ‘AA–’; each a rating","page_number":179,"box":{"x":102,"y":202,"width":761,"height":11}},{"id":"a5f1e7e7-a839-4862-8566-f8e1c60a01b4","block_type":"box","text":"level). Such suffixes are not added to ‘AAA’ ratings and ratings below the ‘CCC’ category. For the shor t-term rating","page_number":179,"box":{"x":70,"y":217,"width":813,"height":12}},{"id":"22ada3f4-0acb-4cad-9a52-09448abfa9f0","block_type":"box","text":"category of ‘F1’, a ‘+’ may be appended.","page_number":179,"box":{"x":69,"y":232,"width":289,"height":12}},{"id":"2a71983c-74e0-46fa-9ee5-abbc6e97ba68","block_type":"box","text":"Description of Fitch’s Short-Term Ratings Assigned to Issuers and Obligations","page_number":179,"box":{"x":69,"y":263,"width":568,"height":11}},{"id":"d9bbb7e5-38b8-426a-92cd-8983fb7272f0","block_type":"box","text":"A shor t-term issuer or obligation rating is based in all cases on the shor t-term vulnerability to default of the rated","page_number":179,"box":{"x":101,"y":285,"width":806,"height":12}},{"id":"8e6707f2-cf70-4233-91dd-464e1fcbbaf7","block_type":"box","text":"entity and relates to the capacity to meet financial obligations in accordance with the documentation governing the","page_number":179,"box":{"x":69,"y":300,"width":817,"height":12}},{"id":"8b5087bb-a311-4983-9d8c-0bf945bbdc2d","block_type":"box","text":"relevant obligation. Shor t-term deposit ratings may be adjusted for loss severity. Shor t-term ratings are assigned to","page_number":179,"box":{"x":69,"y":315,"width":822,"height":12}},{"id":"7fe73d62-c08a-4773-9038-2e57e2604b5c","block_type":"box","text":"obligations whose initial maturity is viewed as “shor t term” based on market convention. Typically, this means up to","page_number":179,"box":{"x":69,"y":331,"width":827,"height":11}},{"id":"c3ee381b-be0d-449d-ba04-7ff53f14a2d8","block_type":"box","text":"13 months for corporate, sovereign, and structured obligations and up to 36 months for obligations in U.S. public","page_number":179,"box":{"x":70,"y":346,"width":808,"height":11}},{"id":"ac44cb2c-08b3-4658-a443-de4d03b8f0f7","block_type":"box","text":"finance markets.","page_number":179,"box":{"x":68,"y":361,"width":118,"height":9}},{"id":"6d4bb5ca-5f5e-42d9-a3f9-60932650d505","block_type":"box","text":"Fitch shor t-term ratings are as follows:","page_number":179,"box":{"x":102,"y":383,"width":273,"height":12}},{"id":"40923cd2-57a7-449f-919a-1d15c0104a68","block_type":"box","text":"F1 Highest Shor t-Term Credit Quality. Indicates the strongest intrinsic capacity for timely payment of","page_number":179,"box":{"x":70,"y":411,"width":816,"height":12}},{"id":"0b5a105e-82d5-4cde-9b87-4ea7f05fdcd4","block_type":"box","text":"financial commitments; may have an added “+” to denote any exceptionally strong credit feature.","page_number":179,"box":{"x":196,"y":426,"width":692,"height":12}},{"id":"02bc533e-496d-400b-b66b-4a0c79bfc449","block_type":"box","text":"F2 Good Shor t-Term Credit Quality. Good intrinsic capacity for timely payment of financial","page_number":179,"box":{"x":70,"y":446,"width":734,"height":12}},{"id":"c14651d4-3395-44fb-8dfc-71138823e55c","block_type":"box","text":"commitments.","page_number":179,"box":{"x":196,"y":462,"width":100,"height":9}},{"id":"124f2bf0-13cf-4fc7-b9b4-fad4049ee18c","block_type":"box","text":"F3 Fair Shor t-Term Credit Quality. The intrinsic capacity for timely payment of financial commitments is","page_number":179,"box":{"x":70,"y":482,"width":831,"height":11}},{"id":"f1cb68e8-9cc5-4ba4-b8ea-c22ff295c765","block_type":"box","text":"adequate.","page_number":179,"box":{"x":196,"y":497,"width":70,"height":11}},{"id":"4705c45a-e0c9-4d53-8d7d-e78f4efaa115","block_type":"box","text":"B Speculative Shor t-Term Credit Quality. Minimal capacity for timely payment of financial","page_number":179,"box":{"x":70,"y":517,"width":737,"height":11}},{"id":"8b2525d6-7e46-48f7-8878-3067716fdff0","block_type":"box","text":"commitments, plus heightened vulnerability to near term adverse changes in financial and","page_number":179,"box":{"x":196,"y":532,"width":641,"height":11}},{"id":"fd782479-e261-4825-8b34-c9ba270acb2c","block_type":"box","text":"economic conditions.","page_number":179,"box":{"x":196,"y":548,"width":149,"height":8}},{"id":"238a3f56-d9f3-46dd-9014-dcf1c078651b","block_type":"box","text":"C High Shor t-Term Default Risk. Default is a real possibility.","page_number":179,"box":{"x":69,"y":567,"width":535,"height":12}},{"id":"395d0772-675a-44a3-acf4-c9b27b0c2a35","block_type":"box","text":"RD Restricted Default. 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The guidance informs the voting recommendations BAIS","page_number":184,"box":{"x":69,"y":143,"width":803,"height":11}},{"id":"2edb1d71-c7d6-4655-a46f-ee1b36e3ba46","block_type":"box","text":"makes to BlackRock’s active por tfolio managers. It applies to active equity holdings in BlackRock’s fundamental","page_number":184,"box":{"x":69,"y":158,"width":800,"height":11}},{"id":"5e3e6c9d-b6dc-4068-9e93-16b85f557834","block_type":"box","text":"equity, systematic equity and multi-asset solutions strategies. It also may apply to holdings in BlackRock’s index and","page_number":184,"box":{"x":69,"y":173,"width":831,"height":11}},{"id":"ca86993a-1dd8-42b3-bba5-0e9bb0273f7c","block_type":"box","text":"active fixed income strategies, to the extent those strategies hold voting securities or conduct issuer engagements.","page_number":184,"box":{"x":69,"y":188,"width":823,"height":12}},{"id":"e23cb66f-68fa-4819-b74e-5351db735134","block_type":"box","text":"The guidelines are not prescriptive as active por tfolio managers have discretion as to how they integrate these","page_number":184,"box":{"x":68,"y":203,"width":789,"height":12}},{"id":"9296b23d-c162-4de4-a5f0-549763f01a77","block_type":"box","text":"guidelines within their investment processes in light of their clients’ or funds’ investment objectives. There are","page_number":184,"box":{"x":68,"y":218,"width":788,"height":12}},{"id":"0c0dc3ba-f388-46f6-a155-b30a2d3ddbcd","block_type":"box","text":"separate, independently developed principles and voting policies that are applied to BlackRock’s index equity","page_number":184,"box":{"x":69,"y":234,"width":778,"height":11}},{"id":"ac2ad321-51f3-40c3-9696-9fc9dfc7f6f5","block_type":"box","text":"investments by a distinct and independent function, BlackRock Investment Stewardship.","page_number":184,"box":{"x":70,"y":249,"width":627,"height":11}},{"id":"1c2c75f9-1ddf-44b7-890c-8ce155057b4e","block_type":"box","text":"1","page_number":184,"box":{"x":69,"y":294,"width":4,"height":4}},{"id":"6a495c7c-994b-48e4-a980-0830b34ef297","block_type":"box","text":"This document includes BAIS’ benchmark policy, which covers nearly all active equity holdings in BlackRock’s","page_number":184,"box":{"x":78,"y":293,"width":777,"height":11}},{"id":"f3d2675e-e876-4437-827c-9defe219acf7","block_type":"box","text":"fundamental equity, systematic equity and multi-asset solutions strategies. The benchmark policy also may apply to","page_number":184,"box":{"x":68,"y":308,"width":823,"height":11}},{"id":"1312c972-2a4c-4b0b-9cb5-d742de6fdb9e","block_type":"box","text":"holdings in BlackRock’s index and active fixed income strategies, to the extent those strategies hold voting securities","page_number":184,"box":{"x":69,"y":323,"width":837,"height":12}},{"id":"a9c60d5b-5244-4c40-99d5-025a117cd319","block_type":"box","text":"or conduct issuer engagements. This document also includes BAIS’ decarbonization policy, which covers holdings in","page_number":184,"box":{"x":69,"y":339,"width":824,"height":11}},{"id":"15130360-aa0f-427d-8a5c-d3134a7ebd3c","block_type":"box","text":"BlackRock active funds that have climate and decarbonization objectives in addition to financial objectives.","page_number":184,"box":{"x":70,"y":354,"width":759,"height":11}},{"id":"64fedec6-3be0-4c42-9fb4-47b6ac4633c0","block_type":"box","text":"2","page_number":184,"box":{"x":69,"y":372,"width":4,"height":4}},{"id":"3fbb7705-bf25-42ef-85a0-4dfe2e32caae","block_type":"box","text":"BlackRock segmented active and index equity investment functions, including stewardship, in January 2025 as par t","page_number":184,"box":{"x":79,"y":371,"width":825,"height":11}},{"id":"26a71d07-b69d-4838-a09b-f16bceef8b9b","block_type":"box","text":"of a strategic initiative to unlock the full breadth of the firm’s active and private markets capabilities for clients. As a","page_number":184,"box":{"x":69,"y":386,"width":830,"height":12}},{"id":"6f86709b-ad38-4b62-a532-e8756af67ea7","block_type":"box","text":"result, there are two stewardship teams, which operate independently of one another and have separate voting","page_number":184,"box":{"x":69,"y":401,"width":792,"height":12}},{"id":"802af20d-0ab8-426e-bda0-126f0000c17d","block_type":"box","text":"policies.","page_number":184,"box":{"x":70,"y":417,"width":56,"height":11}},{"id":"c89f6552-0db0-4986-a579-3823cfdf5151","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":184,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"96b5fb85-3cbb-422b-9671-0234f0c1787d","block_type":"box","text":"Global Engagement and Voting Guidelines | 3","page_number":184,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"5722d694-c879-40e1-8fa2-985dd8f4a33b","block_type":"box","text":"NM1026U-5982568-184/232","page_number":184,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"83b55f7c-e4e2-4d6a-8ecd-e56885a71e89","block_type":"box","text":"INTRODUCTION TO BLACKROCK","page_number":185,"box":{"x":372,"y":45,"width":235,"height":9}},{"id":"7b044939-8044-4b36-9eed-2bb2b6dcdba1","block_type":"box","text":"BlackRock’s mission is to help more people invest better. The money BlackRock manages is not its own — it","page_number":185,"box":{"x":102,"y":64,"width":777,"height":11}},{"id":"4c094610-b6ec-4cc8-b1da-62dcc5356cd2","block_type":"box","text":"belongs to BlackRock’s clients, many of whom make their own asset allocation and por tfolio construction decisions.","page_number":185,"box":{"x":69,"y":78,"width":828,"height":12}},{"id":"82002d50-267e-4e8c-b215-5731846811da","block_type":"box","text":"As a fiduciary, BlackRock invests on clients’ behalf to help them meet their investment objectives. The firm does this","page_number":185,"box":{"x":68,"y":93,"width":835,"height":11}},{"id":"1bfdfd8f-59ee-4502-a99f-97655c83a2c4","block_type":"box","text":"by understanding clients’ long-term investment objectives and offering choice on how and where they wish to invest","page_number":185,"box":{"x":69,"y":108,"width":823,"height":11}},{"id":"ef1a1523-9cf0-4f0c-8734-81b6111e9f5a","block_type":"box","text":"their money. BlackRock then helps clients seek the best risk-adjusted returns based on those choices, underpinning","page_number":185,"box":{"x":68,"y":123,"width":830,"height":11}},{"id":"f4d79f01-1cd0-4b75-9ee9-f98afc5b4b97","block_type":"box","text":"this work with research, data and analytics.","page_number":185,"box":{"x":68,"y":138,"width":309,"height":11}},{"id":"be1e6bff-ac8a-4a01-8318-a5148d111437","block_type":"box","text":"At BlackRock, investment stewardship is core to our role as an asset manager and a fiduciary to our clients. As","page_number":185,"box":{"x":101,"y":156,"width":796,"height":12}},{"id":"6f23753b-4f05-4498-be3f-ceda704cebf9","block_type":"box","text":"stewards of our clients’ assets, we engage with companies to discuss the corporate governance and business","page_number":185,"box":{"x":69,"y":171,"width":787,"height":12}},{"id":"c48195c5-87e6-4787-95bc-57b4896ec448","block_type":"box","text":"practices that, in our experience, suppor t companies in delivering durable, risk-adjusted financial returns over time.","page_number":185,"box":{"x":70,"y":186,"width":820,"height":12}},{"id":"34b6d30b-f566-4071-99c1-27c7661f7e7c","block_type":"box","text":"We are committed to building strong relationships through constructive, ongoing dialogue with the boards and","page_number":185,"box":{"x":68,"y":201,"width":782,"height":11}},{"id":"9dda8ccf-f7f3-4424-b79b-978e61495f2d","block_type":"box","text":"executive management of the companies in which our clients are invested.","page_number":185,"box":{"x":69,"y":216,"width":531,"height":11}},{"id":"c6ef8be6-d17a-4f47-aae6-d7a218af16a0","block_type":"box","text":"ABOUT BLACKROCK ACTIVE INVESTMENT STEWARDSHIP","page_number":185,"box":{"x":277,"y":246,"width":424,"height":9}},{"id":"7f0a061f-b6f9-47c4-89b9-1a7675a619fc","block_type":"box","text":"BlackRock Active Investment Stewardship (BAIS) is a specialist team within the Por tfolio Management Group and","page_number":185,"box":{"x":102,"y":265,"width":804,"height":11}},{"id":"f4de6fa0-f7eb-49cf-b1ca-efdedb40d48c","block_type":"box","text":"manages BlackRock’s stewardship engagement and voting on behalf of clients invested in active strategies globally.","page_number":185,"box":{"x":69,"y":280,"width":826,"height":11}},{"id":"7d5c7d9d-15da-4fa8-aa34-86dcd6c2c478","block_type":"box","text":"BAIS is also responsible for engagement with issuers in index fixed income strategies, where appropriate. Our","page_number":185,"box":{"x":70,"y":295,"width":783,"height":11}},{"id":"c766bf2b-c605-40cd-9e4a-1064bca36d21","block_type":"box","text":"activities are informed by these Global Engagement and Voting Guidelines (the “Guidelines”) and insights from active","page_number":185,"box":{"x":69,"y":309,"width":834,"height":12}},{"id":"34664dcf-fbb0-444c-8137-25159d4dfb33","block_type":"box","text":"investment analysts and por tfolio managers, with whom we work closely in engaging companies and voting at","page_number":185,"box":{"x":70,"y":324,"width":779,"height":12}},{"id":"66d0defd-d69f-4fd6-b47c-163fa8091416","block_type":"box","text":"shareholder meetings.","page_number":185,"box":{"x":69,"y":339,"width":158,"height":11}},{"id":"fa69de6c-b20f-4581-a210-5fb0408e6249","block_type":"box","text":"Engagement with public companies is the foundation of our approach to stewardship within fundamental active","page_number":185,"box":{"x":102,"y":358,"width":789,"height":11}},{"id":"0c051072-1b9a-4f07-9701-1eef8cca082e","block_type":"box","text":"investing.","page_number":185,"box":{"x":70,"y":373,"width":65,"height":11}},{"id":"cccbd765-0732-4614-83bc-cae37d7253ba","block_type":"box","text":"3","page_number":185,"box":{"x":137,"y":373,"width":4,"height":5}},{"id":"2cf72939-24e8-4225-9f2c-b1408b0abdf7","block_type":"box","text":"Through direct dialogue with company leadership, we seek to understand their businesses and how they","page_number":185,"box":{"x":146,"y":373,"width":744,"height":11}},{"id":"44cfdc32-745b-4410-9aae-59d82e91a997","block_type":"box","text":"manage risks and oppor tunities to deliver durable, risk-adjusted financial returns. Por tfolio managers and","page_number":185,"box":{"x":69,"y":387,"width":751,"height":12}},{"id":"91a01b8d-2118-419e-8708-9db1608d8002","block_type":"box","text":"stewardship specialists may engage jointly or independently on material corporate governance matters. Our","page_number":185,"box":{"x":69,"y":402,"width":765,"height":12}},{"id":"e4117276-577c-4a7e-a54b-e5e1b7cf2d5c","block_type":"box","text":"discussions focus on topics relevant to a company’s success over time, including governance and leadership,","page_number":185,"box":{"x":69,"y":417,"width":782,"height":12}},{"id":"bb670697-0fe7-4356-bc87-0e2011ca1917","block_type":"box","text":"corporate strategy, capital structure and financial per formance, operations and material sustainability-related risks,","page_number":185,"box":{"x":69,"y":432,"width":820,"height":11}},{"id":"2e65040f-54df-442f-82f2-e0c2a384f2bd","block_type":"box","text":"as well as macro-economic, geopolitical and sector dynamics. We aim to be constructive investors and are generally","page_number":185,"box":{"x":69,"y":447,"width":828,"height":11}},{"id":"15cf3d9b-38f6-42ae-b074-1be46c21d0a4","block_type":"box","text":"suppor tive of management teams that have a track record of financial value creation. We aim to build and maintain","page_number":185,"box":{"x":69,"y":462,"width":821,"height":11}},{"id":"6522985e-c8b7-46fe-8349-d59b8bd8283e","block_type":"box","text":"strong relationships with company leadership based on open dialogue and mutual respect.","page_number":185,"box":{"x":69,"y":477,"width":645,"height":11}},{"id":"99806a21-b3e6-4bf9-9f45-8ba7f18ed196","block_type":"box","text":"Different active equity strategies may implement these voting guidelines differently, as a result of the latitude","page_number":185,"box":{"x":102,"y":495,"width":780,"height":12}},{"id":"97f8432c-b7e2-4cc7-a190-d8fe97f46562","block_type":"box","text":"each por tfolio manager has to make independent voting decisions on their holdings. For example, BAIS will generally","page_number":185,"box":{"x":69,"y":510,"width":831,"height":11}},{"id":"5d3f7b86-9cbc-4082-809c-08d1d19c18db","block_type":"box","text":"vote the holdings in Systematic Active Equity por tfolios in accordance with these guidelines. We provide voting","page_number":185,"box":{"x":68,"y":525,"width":787,"height":11}},{"id":"ee6d6200-0bfc-48c5-bcec-d8f5e92d8de3","block_type":"box","text":"recommendations to fundamental equity por tfolio managers, who may determine to vote differently based on each","page_number":185,"box":{"x":69,"y":540,"width":816,"height":11}},{"id":"cfcdb574-87a0-4413-8e84-290866f76ace","block_type":"box","text":"por tfolio’s investment objectives and strategy.","page_number":185,"box":{"x":70,"y":555,"width":327,"height":11}},{"id":"2c918abb-404b-424e-99f0-19a68f2db844","block_type":"box","text":"These guidelines discuss BAIS’ views on corporate governance topics on which we may engage with","page_number":185,"box":{"x":101,"y":574,"width":711,"height":11}},{"id":"dfdf68bd-4f28-4108-8ba2-64fe5493b1e0","block_type":"box","text":"management teams and board directors","page_number":185,"box":{"x":69,"y":589,"width":285,"height":11}},{"id":"2eaaa04e-e974-44fe-b73e-1e55abb3dde2","block_type":"box","text":"4","page_number":185,"box":{"x":355,"y":589,"width":5,"height":4}},{"id":"e3e78c1c-a1a5-41c9-880b-5722c834c979","block_type":"box","text":"and on matters that routinely come to a shareholder vote. We recognize that","page_number":185,"box":{"x":366,"y":589,"width":544,"height":11}},{"id":"99faf8e8-b585-4f8a-adfb-3d6cbf084938","block_type":"box","text":"accepted corporate governance norms can differ across markets, and believe these guidelines represent globally","page_number":185,"box":{"x":69,"y":603,"width":807,"height":11}},{"id":"c4f65547-10c2-482f-901d-0af0b485a375","block_type":"box","text":"applicable elements of governance that suppor t a company’s ability to manage material risks and oppor tunities and","page_number":185,"box":{"x":69,"y":618,"width":827,"height":11}},{"id":"c96c72fa-3f55-405a-ab74-4ef350205037","block_type":"box","text":"deliver financial returns to investors. Generally, we believe companies should observe accepted corporate governance","page_number":185,"box":{"x":69,"y":633,"width":840,"height":11}},{"id":"903b973f-a43e-4456-a26a-06c1091da064","block_type":"box","text":"norms within their local markets or, par ticularly in markets without well-established norms, aspire to widely","page_number":185,"box":{"x":69,"y":648,"width":762,"height":11}},{"id":"e57ce559-01ac-4382-a195-9f2de5e87798","block_type":"box","text":"recognized international best practices. As one of many minority shareholders, BlackRock cannot – and does not try","page_number":185,"box":{"x":69,"y":663,"width":827,"height":11}},{"id":"269b7eb3-9fa1-45c1-8479-c4333e9893da","block_type":"box","text":"to – direct a company’s strategy or its implementation. We look to companies to provide disclosures that explain how","page_number":185,"box":{"x":68,"y":678,"width":837,"height":11}},{"id":"1a5d7f65-d1a1-4f1a-815e-a9a28959ba8e","block_type":"box","text":"their approach to corporate governance best aligns with the financial interests of their investors.","page_number":185,"box":{"x":68,"y":692,"width":687,"height":12}},{"id":"7feff231-8795-48bc-915c-5475817136ad","block_type":"box","text":"OUR APPROACH TO STEWARDSHIP WITHIN ACTIVE EQUITIES","page_number":185,"box":{"x":263,"y":722,"width":451,"height":11}},{"id":"247ee720-2986-4d7e-a56a-2da6240d35f7","block_type":"box","text":"Voting at a company’s shareholder meeting is a right of share ownership and a core principle of corporate","page_number":185,"box":{"x":101,"y":741,"width":753,"height":12}},{"id":"9d94ba47-14ee-4eea-9299-e9aa77cf1954","block_type":"box","text":"governance. The voting rights attached to clients’ holdings are an impor tant mechanism for investors to express","page_number":185,"box":{"x":68,"y":756,"width":801,"height":11}},{"id":"0f5e061e-1efa-40a7-8261-3e1b8d138a1a","block_type":"box","text":"suppor t for, or concern about, a company’s per formance. As a fiduciary, BlackRock is legally required to make proxy","page_number":185,"box":{"x":69,"y":771,"width":829,"height":11}},{"id":"74bd26dd-75f7-4ac7-9364-1fa5b0a5bf4b","block_type":"box","text":"voting determinations, on behalf of clients who have delegated voting authority to us, in a manner consistent with","page_number":185,"box":{"x":68,"y":786,"width":809,"height":11}},{"id":"b303169c-c85d-4dc5-be4b-6b0586bb1b5d","block_type":"box","text":"BlackRock’s contractual arrangements with clients and funds.","page_number":185,"box":{"x":70,"y":801,"width":438,"height":11}},{"id":"52b9fc3d-5ae9-4463-ae2a-4ffccb863d32","block_type":"box","text":"3","page_number":185,"box":{"x":69,"y":830,"width":4,"height":5}},{"id":"1126bf7f-d024-4c90-aac8-916df2e6afca","block_type":"box","text":"On February 11, 2025, the U.S. Securities and Exchange Commission (SEC) staff issued updated guidance for","page_number":185,"box":{"x":79,"y":830,"width":790,"height":11}},{"id":"7f27dded-02ee-4332-bccd-adbb839c4146","block_type":"box","text":"shareholders to maintain their eligibility to repor t their beneficial ownership under Schedule 13G of the Exchange Act.","page_number":185,"box":{"x":69,"y":845,"width":836,"height":11}},{"id":"c8fdd538-66ce-4e44-8260-29d72de5bbf9","block_type":"box","text":"We comply fully with these requirements and do not engage with por tfolio companies for the purpose, or with the","page_number":185,"box":{"x":68,"y":860,"width":805,"height":11}},{"id":"9844ee6b-47c6-4614-924f-f85ecfefcfd9","block_type":"box","text":"effect, of changing or influencing control of the company.","page_number":185,"box":{"x":69,"y":875,"width":403,"height":12}},{"id":"78aad867-260b-4d1a-81e3-b768020d7157","block_type":"box","text":"4","page_number":185,"box":{"x":69,"y":893,"width":4,"height":5}},{"id":"2d8f1ceb-0ff9-4263-aae8-7202f12969b6","block_type":"box","text":"References to the board, board directors or non-executive directors should be understood to include supervisory","page_number":185,"box":{"x":79,"y":893,"width":801,"height":11}},{"id":"f9feebd0-d551-4dfe-a0ac-401faef05b19","block_type":"box","text":"boards and their members, where relevant.","page_number":185,"box":{"x":69,"y":908,"width":306,"height":11}},{"id":"ceef2f20-2ae1-40b6-84fe-b4ed90b512cf","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":185,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"f1d02aac-f680-4d62-95e0-1abac6eb1996","block_type":"box","text":"Global Engagement and Voting Guidelines | 4","page_number":185,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"23848ee3-c68f-47ce-b4fb-f7b370640b52","block_type":"box","text":"NM1026U-5982568-185/232","page_number":185,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"7ef9e727-ca3d-4d8e-b74e-a346988be05e","block_type":"box","text":"In general, we tend to suppor t the recommendations of the board of directors and management. As indicated","page_number":186,"box":{"x":102,"y":45,"width":778,"height":11}},{"id":"16bc0d2b-c8bd-4b58-a204-5a347c119bc5","block_type":"box","text":"below, we may vote against management recommendations when we have concerns about how companies are","page_number":186,"box":{"x":69,"y":60,"width":788,"height":11}},{"id":"087f5c4a-bd10-4de8-a8a0-ceb4e59a7f68","block_type":"box","text":"serving the financial interests of our clients as their shareholders. BAIS takes a globally consistent approach to","page_number":186,"box":{"x":69,"y":74,"width":795,"height":12}},{"id":"86aa3cf6-d23a-4733-9d9d-524c0ce08be3","block_type":"box","text":"voting but considers the different corporate governance regulations and norms across markets. Votes are determined","page_number":186,"box":{"x":68,"y":89,"width":839,"height":12}},{"id":"9082ab18-7856-4f16-b2b8-46f314bc74e7","block_type":"box","text":"on a case-by-case basis, in the context of a company’s situation and the investment mandate we have from clients.","page_number":186,"box":{"x":69,"y":104,"width":823,"height":11}},{"id":"4ea64cd4-c511-4dd3-976a-58a43ef52a76","block_type":"box","text":"Please see page 19 for more information about how we fulfill and oversee our investment stewardship","page_number":186,"box":{"x":69,"y":119,"width":729,"height":11}},{"id":"26018c07-cebd-4c3a-b160-c147792e55a0","block_type":"box","text":"responsibilities for BlackRock’s non-index equity strategies.","page_number":186,"box":{"x":69,"y":134,"width":423,"height":11}},{"id":"66119290-bed1-4089-86de-e6076027379a","block_type":"box","text":"5","page_number":186,"box":{"x":493,"y":134,"width":5,"height":5}},{"id":"92c691cb-b0e8-494c-9e6a-ac732e2e1741","block_type":"box","text":"OUR APPROACH TO STEWARDSHIP WITHIN FIXED INCOME","page_number":186,"box":{"x":272,"y":164,"width":434,"height":9}},{"id":"0673870a-d2b5-46f0-b24d-ad278c5a0dc1","block_type":"box","text":"Although fixed income investors do not have the right to vote at shareholder meetings, issuer engagement is a","page_number":186,"box":{"x":101,"y":183,"width":788,"height":11}},{"id":"ab3e38e7-9b4d-44b0-8dfb-adb41a890890","block_type":"box","text":"component of fixed income investment strategies at BlackRock, par ticularly for those with sustainability objectives in","page_number":186,"box":{"x":69,"y":198,"width":831,"height":11}},{"id":"8ce56c92-d0d2-4ec3-bb34-7d681ad55068","block_type":"box","text":"addition to financial objectives. Most corporate governance-related fixed income engagements are under taken in","page_number":186,"box":{"x":69,"y":212,"width":801,"height":12}},{"id":"729fcd12-1322-4943-9f86-b996258a76c1","block_type":"box","text":"conjunction with the active investment stewardship team, and often active equity investors. In addition to the topics","page_number":186,"box":{"x":69,"y":227,"width":824,"height":11}},{"id":"f10abb36-d2a8-48c5-a76d-5550af8be9d8","block_type":"box","text":"listed below, engagement with fixed income investment teams may help inform an issuer’s approach to structuring","page_number":186,"box":{"x":70,"y":242,"width":816,"height":11}},{"id":"26041323-9b44-45b7-b784-9012a8486282","block_type":"box","text":"specialist issuances and the standard terms and information in bond documentation.","page_number":186,"box":{"x":69,"y":257,"width":608,"height":11}},{"id":"aed7f7d3-32b9-490b-a89d-892d3a132ae9","block_type":"box","text":"5","page_number":186,"box":{"x":69,"y":302,"width":4,"height":4}},{"id":"029979a3-d613-4955-9cf1-9f93f00657d7","block_type":"box","text":"Non-index equity strategies include active equity holdings in BlackRock’s fundamental equity, systematic equity and","page_number":186,"box":{"x":79,"y":301,"width":820,"height":11}},{"id":"d7ee691b-6ffc-4f07-a46f-f45dda819f6a","block_type":"box","text":"multi-asset solutions strategies, as well as holdings in BlackRock’s index and active fixed income strategies, to the","page_number":186,"box":{"x":69,"y":316,"width":822,"height":12}},{"id":"f6a98aa8-772a-46c1-86cc-5193e40d05c9","block_type":"box","text":"extent those strategies hold voting securities or conduct issuer engagements.","page_number":186,"box":{"x":69,"y":332,"width":554,"height":11}},{"id":"daa07e6c-36cd-4574-9c8c-73b1ebb5b4e7","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":186,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"c9d4fa68-0d25-4d0b-b8a2-9f539f0bd7a4","block_type":"box","text":"Global Engagement and Voting Guidelines | 5","page_number":186,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"3c499b04-0f10-4718-9610-a7d7eb3725dd","block_type":"box","text":"NM1026U-5982568-186/232","page_number":186,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"487ade4f-b22f-4d5b-8aae-15df47848069","block_type":"box","text":"BOARDS OF DIRECTORS","page_number":187,"box":{"x":400,"y":45,"width":178,"height":9}},{"id":"63ef2555-226e-449d-ba3f-8082528de1e6","block_type":"box","text":"Roles and responsibilities","page_number":187,"box":{"x":69,"y":67,"width":186,"height":11}},{"id":"662c922a-28f8-4181-baae-e82834497bbe","block_type":"box","text":"There is widespread consensus that the foundation of good corporate governance is an effective board of","page_number":187,"box":{"x":101,"y":86,"width":754,"height":11}},{"id":"3124d5e2-3e98-4d9d-a85e-27f600ef08b0","block_type":"box","text":"directors that is able to advise and supervise management in an independent and objective manner.","page_number":187,"box":{"x":69,"y":101,"width":715,"height":11}},{"id":"59a73d75-10b2-40bc-b693-8cf687981edf","block_type":"box","text":"6","page_number":187,"box":{"x":786,"y":101,"width":4,"height":5}},{"id":"fd9be50f-1dce-4a3e-8a78-c803f0359461","block_type":"box","text":"We look to the board of directors (hereafter the “board”) to have an oversight role in the establishment and","page_number":187,"box":{"x":101,"y":119,"width":765,"height":12}},{"id":"56fdbc17-4868-43e3-9968-4fde511b5f60","block_type":"box","text":"realization of a company’s strategy, purpose and culture. These constructs are interdependent and, when aligned,","page_number":187,"box":{"x":69,"y":134,"width":811,"height":12}},{"id":"2c5f661f-5b72-46a0-ae90-d6b6430f6204","block_type":"box","text":"can better position a company to be resilient in the face of a changing business environment, help reduce the risks","page_number":187,"box":{"x":69,"y":149,"width":822,"height":11}},{"id":"6cc3bff7-e8c3-4bc3-bf71-27b23076e3a6","block_type":"box","text":"of corporate or employee misconduct, and attract and retain the caliber of workers necessary to deliver financial","page_number":187,"box":{"x":69,"y":164,"width":799,"height":11}},{"id":"2bd7c281-a75b-453a-9c6e-4e16ba917e52","block_type":"box","text":"per formance over time.","page_number":187,"box":{"x":70,"y":179,"width":164,"height":11}},{"id":"1b2db6ce-1919-4254-9d84-31e358f305b5","block_type":"box","text":"In overseeing the management of the company, the board ensures the necessary resources, policies and","page_number":187,"box":{"x":102,"y":198,"width":750,"height":11}},{"id":"50b9e252-3bfa-42df-acc9-2dd795eca73d","block_type":"box","text":"procedures are in place to help management meet its strategic objectives within an agreed risk tolerance.","page_number":187,"box":{"x":70,"y":213,"width":753,"height":11}},{"id":"03752bde-f5d7-46da-8cf5-1697e84133fc","block_type":"box","text":"One of the most impor tant responsibilities of the board is to appoint, and remove as necessary, the chief","page_number":187,"box":{"x":102,"y":231,"width":753,"height":11}},{"id":"d467cb72-7224-4702-8347-a4400ef9ce95","block_type":"box","text":"executive officer (“CEO”). In addition, the board plays a meaningful role in monitoring the per formance of the CEO","page_number":187,"box":{"x":69,"y":246,"width":811,"height":11}},{"id":"188afa90-6925-4c5c-bbbd-86838df2dca5","block_type":"box","text":"and other key executives, determining executive compensation, ensuring a rigorous audit, overseeing strategy","page_number":187,"box":{"x":69,"y":261,"width":783,"height":11}},{"id":"77bc72a6-7d9f-42ea-9185-1b1d821a13a8","block_type":"box","text":"execution and risk management and engaging with shareholders, and other stakeholders, as necessary.","page_number":187,"box":{"x":69,"y":276,"width":742,"height":11}},{"id":"af1911b2-4910-4dda-b423-88a7c6d876fc","block_type":"box","text":"Composition and effectiveness","page_number":187,"box":{"x":69,"y":298,"width":224,"height":11}},{"id":"e0c8f376-b480-4cb9-9db3-89b610854b35","block_type":"box","text":"Appointment process","page_number":187,"box":{"x":68,"y":317,"width":152,"height":11}},{"id":"3d425a7d-8750-467a-afe4-f29c533e045c","block_type":"box","text":"A formal and transparent process for identifying and appointing director candidates is critical to ensuring the","page_number":187,"box":{"x":101,"y":335,"width":773,"height":12}},{"id":"768e6bd8-33d9-42f2-8343-93316fe6aeba","block_type":"box","text":"board is composed of directors with the appropriate mix of skills and experience. Generally, the board or a sub","page_number":187,"box":{"x":69,"y":350,"width":792,"height":11}},{"id":"873e16c8-adea-4c5d-8369-22d47326dfff","block_type":"box","text":"committee determines the general criteria given the company’s circumstances (","page_number":187,"box":{"x":69,"y":365,"width":568,"height":11}},{"id":"ef33cd5e-17ba-4bcb-9818-7fae937e2121","block_type":"box","text":"e.g.","page_number":187,"box":{"x":638,"y":367,"width":25,"height":9}},{"id":"16bab8ab-0f31-4338-a8b9-966db434fb31","block_type":"box","text":", sector, maturity, geographic","page_number":187,"box":{"x":666,"y":365,"width":204,"height":11}},{"id":"32df36bf-4a98-43e4-89eb-83f572dc995a","block_type":"box","text":"footprint) and any additional criteria for a specific role being filled (","page_number":187,"box":{"x":68,"y":380,"width":474,"height":11}},{"id":"18196820-1f48-45e3-bad0-50479181a04c","block_type":"box","text":"e.g.","page_number":187,"box":{"x":544,"y":381,"width":25,"height":10}},{"id":"23c10a5a-db76-48e4-9fa8-f688009e33e5","block_type":"box","text":", financial exper tise, industry track record). To","page_number":187,"box":{"x":571,"y":380,"width":327,"height":11}},{"id":"1fdfa679-e9f6-4e4f-9f75-d0ed00e197d1","block_type":"box","text":"inform the process, we encourage companies to review the skills and experience of incumbent directors to identify","page_number":187,"box":{"x":70,"y":395,"width":815,"height":11}},{"id":"3c5cd1ca-c85b-449e-b5e7-b8312d97d342","block_type":"box","text":"any gaps and whether the skills and experience of a director candidate would be additive. We welcome disclosures","page_number":187,"box":{"x":69,"y":410,"width":817,"height":11}},{"id":"1522e903-cc80-4054-a5c4-43fcc89f7df3","block_type":"box","text":"that explain how the board considered different skills and experience to ensure that the directors collectively can be","page_number":187,"box":{"x":68,"y":425,"width":829,"height":11}},{"id":"ae21fe3a-088b-4877-b04a-b30413c6331a","block_type":"box","text":"effective in fulfilling their responsibilities. We assess a company’s board composition against that of its peer group","page_number":187,"box":{"x":69,"y":439,"width":821,"height":12}},{"id":"d3303bef-03eb-4d4d-8691-b1d328fd74b3","block_type":"box","text":"and local market requirements.","page_number":187,"box":{"x":69,"y":455,"width":221,"height":10}},{"id":"a7ba3ccf-6dde-4a4a-8e9c-7cef02e0f7a2","block_type":"box","text":"Shareholders periodically vote to elect directors to serve on the board. We do not prescribe any par ticular board","page_number":187,"box":{"x":102,"y":473,"width":798,"height":11}},{"id":"fa08f755-eedf-4128-bfe7-9b263bbb57d3","block_type":"box","text":"composition in our engagements or voting but seek to understand how well placed a board is to act in investors’","page_number":187,"box":{"x":69,"y":488,"width":800,"height":11}},{"id":"08bc0f39-89ac-4c8a-bc86-6f6c7bf60a08","block_type":"box","text":"interests. We may vote against the election of the most senior independent director, or the chair of the relevant","page_number":187,"box":{"x":70,"y":503,"width":794,"height":11}},{"id":"ad9ab7f8-08d5-4a47-a5a1-7b5ca3b49472","block_type":"box","text":"committee, where a company has not demonstrated it has an appointment process that results in a high functioning","page_number":187,"box":{"x":69,"y":517,"width":830,"height":12}},{"id":"63e946ab-c8d9-4ccf-878f-d571b4d65367","block_type":"box","text":"board with the appropriate complement of skills and experience amongst the directors to suppor t strong financial","page_number":187,"box":{"x":69,"y":532,"width":808,"height":12}},{"id":"58460430-bd2e-45b4-822e-400a2df7a13c","block_type":"box","text":"per formance over time. We may vote against newly nominated directors who do not seem to have the appropriate","page_number":187,"box":{"x":70,"y":547,"width":808,"height":12}},{"id":"beedc8f1-82cf-47eb-be9c-327e7eb97bad","block_type":"box","text":"skills or experience to contribute to the board’s effectiveness.","page_number":187,"box":{"x":69,"y":562,"width":442,"height":11}},{"id":"b6f7e571-c699-49a0-8319-4009e269e9c4","block_type":"box","text":"Independence","page_number":187,"box":{"x":70,"y":585,"width":99,"height":10}},{"id":"861beafb-c30f-4e0b-b51d-fffb2b21de7d","block_type":"box","text":"Director independence from management, significant shareholders or other stakeholders (","page_number":187,"box":{"x":102,"y":603,"width":642,"height":11}},{"id":"6c1d4699-5655-468e-9d22-f054681056ea","block_type":"box","text":"e.g.","page_number":187,"box":{"x":746,"y":605,"width":25,"height":9}},{"id":"eb18f9d9-b0d2-4ff5-90a1-83b57a30e5c4","block_type":"box","text":", government or","page_number":187,"box":{"x":773,"y":604,"width":111,"height":10}},{"id":"a1269860-626b-4ea2-8208-571dc3c7bdd6","block_type":"box","text":"employees) is of paramount impor tance to the protection of the interests of minority shareholders such as","page_number":187,"box":{"x":69,"y":618,"width":759,"height":11}},{"id":"ec41f55b-66d0-43d2-a4e5-c849155f053a","block_type":"box","text":"BlackRock’s clients. We consider it good practice for at least half the directors to be independent and free from","page_number":187,"box":{"x":70,"y":633,"width":793,"height":11}},{"id":"41df8bac-0311-45b3-a548-397ec55a1d2f","block_type":"box","text":"conflicts of interest or undue influence.","page_number":187,"box":{"x":69,"y":648,"width":278,"height":9}},{"id":"2329610f-a31f-4435-bffd-cde26e15b4c9","block_type":"box","text":"7","page_number":187,"box":{"x":349,"y":648,"width":4,"height":5}},{"id":"970c6ef1-8e9c-4f2a-90e1-761fcbebb21b","block_type":"box","text":"This also helps to ensure that board committees are composed of a","page_number":187,"box":{"x":358,"y":648,"width":486,"height":11}},{"id":"14e4a0bc-d8ae-4515-961d-129fdf810c2c","block_type":"box","text":"sufficient number of independent directors. Companies domiciled in markets with a higher threshold for board","page_number":187,"box":{"x":69,"y":663,"width":783,"height":11}},{"id":"ea55620c-a6af-46eb-84de-94b4a1e1c42f","block_type":"box","text":"independence should meet those local requirements.","page_number":187,"box":{"x":70,"y":678,"width":378,"height":10}},{"id":"98977fad-5841-426b-be84-417c53a65105","block_type":"box","text":"We may vote against the election of non-independent directors if the board does not have a sufficient balance of","page_number":187,"box":{"x":101,"y":696,"width":803,"height":11}},{"id":"d7d32e8e-8f5d-498b-8dea-4b6be15afd4a","block_type":"box","text":"independence. We may also vote against the election of the chair of the committee responsible for board","page_number":187,"box":{"x":70,"y":711,"width":748,"height":11}},{"id":"20bfcfef-afe9-4c79-a5c0-01acc0b68665","block_type":"box","text":"composition if this is a perennial issue.","page_number":187,"box":{"x":69,"y":726,"width":280,"height":11}},{"id":"5b8eaed4-0e35-4ddc-9700-cebe420674d3","block_type":"box","text":"6","page_number":187,"box":{"x":69,"y":756,"width":4,"height":4}},{"id":"8850d351-6b21-4132-8a8c-ab40c2c4fad6","block_type":"box","text":"See the Corporate Governance Codes of Germany, Japan, and the UK, as well as the corporate governance","page_number":187,"box":{"x":93,"y":755,"width":763,"height":11}},{"id":"963afac2-3c21-4410-bf55-20391508dffb","block_type":"box","text":"principles of the US Business Roundtable as examples.","page_number":187,"box":{"x":94,"y":770,"width":394,"height":11}},{"id":"3bee2ca7-51b8-4d93-b4d0-b350a81bcde5","block_type":"box","text":"7","page_number":187,"box":{"x":69,"y":788,"width":4,"height":5}},{"id":"9c1b0834-f528-456e-8503-dfa06361bf6d","block_type":"box","text":"Common impediments to independence may include but are not limited to: current or recent employment at the","page_number":187,"box":{"x":93,"y":788,"width":795,"height":11}},{"id":"391ba640-cb84-4f73-b93f-4810099dbc2b","block_type":"box","text":"company or a subsidiary; being, or representing, a shareholder with a substantial shareholding in the company;","page_number":187,"box":{"x":93,"y":803,"width":793,"height":11}},{"id":"cc79d3dd-2d5c-4539-b0a4-936b8908dc27","block_type":"box","text":"interlocking directorships; lengthy tenure, and having any other interest, business, or other relationship which","page_number":187,"box":{"x":94,"y":818,"width":778,"height":11}},{"id":"1e7b21fb-7798-404a-9ca8-c32d453eb5c4","block_type":"box","text":"could, or could reasonably be perceived to, materially inter fere with a director’s ability to act in the best interests","page_number":187,"box":{"x":93,"y":833,"width":807,"height":11}},{"id":"396c12ff-60e4-4cce-a0dc-f46963387de0","block_type":"box","text":"of the company and shareholders.","page_number":187,"box":{"x":93,"y":848,"width":242,"height":11}},{"id":"e6e8822b-371a-48cf-aff5-fe9a98361e04","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":187,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"a174be4e-be2f-4c65-b7ec-ccd0383fc3fb","block_type":"box","text":"Global Engagement and Voting Guidelines | 6","page_number":187,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"0cb695c0-9518-4610-ade4-c7eef4186bdc","block_type":"box","text":"NM1026U-5982568-187/232","page_number":187,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"9e572d21-3a21-4f98-b438-516ffc643038","block_type":"box","text":"Independent board leadership","page_number":188,"box":{"x":70,"y":45,"width":212,"height":11}},{"id":"9aae0dc1-d765-4fe9-a034-0a8dca104f00","block_type":"box","text":"Practices across markets differ, as do board structures, but we observe two main approaches to independent","page_number":188,"box":{"x":102,"y":63,"width":784,"height":11}},{"id":"4a679cd6-1d56-43ae-bd23-6ed14f498a7e","block_type":"box","text":"board leadership. One is a non-executive, independent chair of the board who is responsible for leading the board in","page_number":188,"box":{"x":69,"y":78,"width":827,"height":11}},{"id":"38bc2fb7-cf0e-454e-a534-7717d6f2a0df","block_type":"box","text":"the effective exercise of its duties. The other is a lead or senior independent director, who is responsible for","page_number":188,"box":{"x":68,"y":93,"width":774,"height":11}},{"id":"23f5760e-74c8-4801-893f-d233d8968a5a","block_type":"box","text":"coordinating with the other non-executive directors and working closely with the executive chair on the board agenda","page_number":188,"box":{"x":69,"y":108,"width":826,"height":11}},{"id":"43e71b56-1a19-444c-8840-844aa610d4b9","block_type":"box","text":"and other board procedures. In this case, the executive chair and the lead independent director work together to","page_number":188,"box":{"x":69,"y":123,"width":801,"height":11}},{"id":"fe120f3e-064d-41b4-846d-9ccc5fa84247","block_type":"box","text":"ensure the board is effectively fulfilling its responsibilities. In our view, the independent leader of the board, and/or","page_number":188,"box":{"x":69,"y":138,"width":823,"height":11}},{"id":"52bc2899-a6fd-43dd-98e4-4ed4e0dd9989","block_type":"box","text":"the chair of a relevant committee, should be available to investors to discuss governance matters such as CEO","page_number":188,"box":{"x":68,"y":152,"width":793,"height":12}},{"id":"fab1a70e-500c-40e4-9f5a-fa01564f6e73","block_type":"box","text":"succession, executive pay, and board per formance. We look to boards to explain their board leadership model and","page_number":188,"box":{"x":69,"y":167,"width":816,"height":11}},{"id":"087fcc9b-b97a-4ee4-82b2-715fadf277d7","block_type":"box","text":"how it serves the interests of shareholders.","page_number":188,"box":{"x":69,"y":182,"width":311,"height":9}},{"id":"46beffed-66c5-42e8-a5bd-63f3a707121c","block_type":"box","text":"We may vote against the election of the chair of the committee responsible for board composition if there is not","page_number":188,"box":{"x":101,"y":201,"width":798,"height":11}},{"id":"74eb3f3b-cb7f-45fa-99a3-309a7cbf2362","block_type":"box","text":"an identified independent leader of the board with clear responsibilities for board per formance. We may vote against","page_number":188,"box":{"x":69,"y":216,"width":831,"height":11}},{"id":"9231a9ca-59b6-469f-919c-5e491f9f9d26","block_type":"box","text":"the most senior independent director if the board has a policy of not engaging with shareholders.","page_number":188,"box":{"x":68,"y":231,"width":691,"height":11}},{"id":"64d77beb-f114-49a7-af44-2a6555d73332","block_type":"box","text":"Tenure and succession","page_number":188,"box":{"x":70,"y":253,"width":162,"height":9}},{"id":"5673aa92-9518-4fb7-96de-362e99d67f23","block_type":"box","text":"In our view, it is good practice for boards to establish the length of time a director would normally be expected to","page_number":188,"box":{"x":102,"y":272,"width":803,"height":11}},{"id":"e4224e19-3cbf-4085-b0eb-aee204aa33d1","block_type":"box","text":"serve, in line with market norms where those exist. We find it helpful when companies disclose their approach to","page_number":188,"box":{"x":69,"y":286,"width":805,"height":11}},{"id":"4b66352d-8a6b-4b82-ad61-61a2542104a7","block_type":"box","text":"director tenure par ticularly around the contributions of directors who have served for longer periods than typically","page_number":188,"box":{"x":69,"y":301,"width":806,"height":12}},{"id":"31c5f273-0630-4ca6-b86a-01b5e07535cc","block_type":"box","text":"provided for under local practice. In our experience, long-serving directors could become less independent given their","page_number":188,"box":{"x":70,"y":316,"width":833,"height":12}},{"id":"1c9f2d56-a696-44af-8046-1a84decfee1c","block_type":"box","text":"long-term relationship with management and involvement in past board decisions.","page_number":188,"box":{"x":70,"y":331,"width":581,"height":11}},{"id":"88027b97-e5c1-4a80-80ae-9bd110a9b6c7","block_type":"box","text":"Succession planning for board roles helps achieve the appropriate cadence of turnover that balances renewal","page_number":188,"box":{"x":102,"y":350,"width":779,"height":11}},{"id":"0c7bde5a-942c-4c86-b41f-70359a300750","block_type":"box","text":"through the regular introduction of directors with fresh perspectives and exper tise with continuity through the","page_number":188,"box":{"x":68,"y":365,"width":777,"height":11}},{"id":"5d4d70f5-a520-4e64-b638-eba2cb5a111d","block_type":"box","text":"retention of directors with long-term knowledge of the board and company.","page_number":188,"box":{"x":69,"y":379,"width":528,"height":12}},{"id":"a2c8a3d4-c3a3-4b48-b015-63987b65658c","block_type":"box","text":"In markets where there is not specific director tenure guidance from regulation or corporate governance best","page_number":188,"box":{"x":102,"y":398,"width":774,"height":11}},{"id":"fc1a253a-466d-4439-b099-6dfad6aec08f","block_type":"box","text":"practices, we may vote against the election of the chair of the committee responsible for board composition if a","page_number":188,"box":{"x":70,"y":413,"width":795,"height":11}},{"id":"1927a412-edc7-4e29-abf6-db85b393f8f9","block_type":"box","text":"company does not clearly disclose its approach to director tenure and board renewal. We may vote against the","page_number":188,"box":{"x":69,"y":428,"width":788,"height":11}},{"id":"4dc74262-5c89-4458-8111-b3b25ceb2fc9","block_type":"box","text":"election of directors who have served for more years than is typical in markets with specific guidance, where the case","page_number":188,"box":{"x":69,"y":443,"width":839,"height":11}},{"id":"d70704f3-55dc-436b-b36a-803f9cb70af6","block_type":"box","text":"for their continued service is not evident.","page_number":188,"box":{"x":68,"y":458,"width":292,"height":9}},{"id":"37d6b394-5a5d-4f7f-b8b5-8248ac7ea0c5","block_type":"box","text":"Capacity","page_number":188,"box":{"x":70,"y":480,"width":60,"height":11}},{"id":"93f1e868-2ec0-4970-93f3-da1e3e994070","block_type":"box","text":"To be effective and engaged, directors need to have the time and energy to commit to the role. In our view, an","page_number":188,"box":{"x":101,"y":499,"width":784,"height":11}},{"id":"f2ce02df-8d68-43a2-b17b-aa45501729fa","block_type":"box","text":"effective board will assess the ability of its members to maintain an appropriate focus on board matters and the","page_number":188,"box":{"x":69,"y":513,"width":801,"height":12}},{"id":"7aa38945-7b3d-4328-b3cd-321c93ce65be","block_type":"box","text":"company taking into consideration competing responsibilities. We recognize that board leadership roles vary across","page_number":188,"box":{"x":69,"y":529,"width":823,"height":11}},{"id":"31a70f95-af46-45f3-9993-88ade3affae2","block_type":"box","text":"markets in responsibilities and required time commitment but note that they are generally more intensive than a","page_number":188,"box":{"x":69,"y":543,"width":800,"height":11}},{"id":"85add1ca-7505-4c69-abca-a56ae19997d8","block_type":"box","text":"standard directorship. We will take local norms and practices into consideration when making our voting","page_number":188,"box":{"x":69,"y":558,"width":741,"height":11}},{"id":"f49b1608-f6b7-4b81-9eba-d8f6db6969c2","block_type":"box","text":"determinations across markets.","page_number":188,"box":{"x":69,"y":573,"width":226,"height":9}},{"id":"779a36ee-1f64-45a5-8bb3-b08eee665e2b","block_type":"box","text":"We may vote against the election of directors who do not seem to have sufficient capacity to effectively fulfill","page_number":188,"box":{"x":101,"y":592,"width":776,"height":11}},{"id":"66ea5f6d-cdfa-4d1d-86ab-b1cc15748754","block_type":"box","text":"their duties to the board and company.","page_number":188,"box":{"x":68,"y":607,"width":275,"height":11}},{"id":"f7bb19b1-6290-4ac6-ae50-91d5bf418451","block_type":"box","text":"Director elections","page_number":188,"box":{"x":70,"y":629,"width":124,"height":9}},{"id":"e1e30d88-7d8e-4f09-9e94-7e7c1e61d0d3","block_type":"box","text":"Regular election of directors, ideally annually, suppor ts director accountability to shareholders. A classified board","page_number":188,"box":{"x":102,"y":647,"width":805,"height":12}},{"id":"25500cde-877a-45a9-aead-99de7c36b47f","block_type":"box","text":"structure","page_number":188,"box":{"x":69,"y":663,"width":63,"height":8}},{"id":"8ff3e96c-b5d8-4170-8cf3-bda901f1fd92","block_type":"box","text":"8","page_number":188,"box":{"x":133,"y":663,"width":4,"height":4}},{"id":"b158be7d-7bec-47a1-87c3-c59eceac73ed","block_type":"box","text":"may be justified by a company when it needs consistency and stability during a time of transition, or on the","page_number":188,"box":{"x":144,"y":662,"width":761,"height":12}},{"id":"7e784d81-8162-42fc-bb59-80e7c4645b23","block_type":"box","text":"basis of its business model (","page_number":188,"box":{"x":69,"y":677,"width":206,"height":11}},{"id":"b0543937-7be1-43be-bf99-70f1897ebbce","block_type":"box","text":"e.g.","page_number":188,"box":{"x":277,"y":679,"width":24,"height":10}},{"id":"65a6d8e9-abc4-41cf-84da-b94b9fb43157","block_type":"box","text":", a non-operating company such as closed-end funds).","page_number":188,"box":{"x":304,"y":677,"width":382,"height":12}},{"id":"2ee023a7-e30e-48ab-9cc2-f909bd0a3853","block_type":"box","text":"Shareholders should have the oppor tunity to evaluate nominated directors individually rather than in bundled","page_number":188,"box":{"x":102,"y":696,"width":774,"height":11}},{"id":"11d8a568-9d85-4290-b249-c812cc0c026e","block_type":"box","text":"slates. We look to companies to provide sufficient information on each director standing for election so that","page_number":188,"box":{"x":69,"y":711,"width":770,"height":11}},{"id":"a4165d08-2de1-4fe2-ab2d-775f4761057b","block_type":"box","text":"shareholders can assess their capabilities and suitability. We will generally not suppor t the election of directors","page_number":188,"box":{"x":69,"y":726,"width":794,"height":11}},{"id":"3b4db15c-20dc-40cb-bc04-3fdbe4acce70","block_type":"box","text":"whose names and biographical details have not been disclosed sufficiently in advance of the shareholder meeting.","page_number":188,"box":{"x":68,"y":740,"width":818,"height":12}},{"id":"f6cb9de3-f5a8-4c99-8690-a9b71b665542","block_type":"box","text":"Each director’s appointment should be dependent on receiving a simple majority of the votes cast at the","page_number":188,"box":{"x":102,"y":759,"width":743,"height":11}},{"id":"089f9f81-2385-4ac3-b284-9311deafe52f","block_type":"box","text":"shareholder meeting. Where a company’s practices differ, we look to the board to provide a detailed explanation as","page_number":188,"box":{"x":69,"y":774,"width":823,"height":11}},{"id":"7c581512-5456-4343-b501-5b7a8f34e729","block_type":"box","text":"to how its approach best serves investors’ interests.","page_number":188,"box":{"x":68,"y":789,"width":377,"height":11}},{"id":"91644716-bc4a-408e-839f-6e63315a4eb4","block_type":"box","text":"We may vote for shareholder or management proposals seeking to establish annual election of directors and/or","page_number":188,"box":{"x":101,"y":807,"width":798,"height":12}},{"id":"e92a3802-613b-4aa8-a1ae-5baf8660a0b2","block_type":"box","text":"a simple majority vote standard for director elections. We may vote against all the directors standing for election as","page_number":188,"box":{"x":69,"y":822,"width":822,"height":12}},{"id":"00422ba6-a793-42f8-8758-be1e9ce3dd4d","block_type":"box","text":"par t of a single slate if we have concerns about the profile or per formance of an individual director.","page_number":188,"box":{"x":70,"y":837,"width":706,"height":12}},{"id":"384338ca-1363-419c-80e7-46babfbd812f","block_type":"box","text":"8","page_number":188,"box":{"x":69,"y":867,"width":4,"height":4}},{"id":"b9f6e05a-0ba2-4ee0-a01d-e0cd797c2d39","block_type":"box","text":"A classified board divides the directors into classes with different overlapping terms. As a result, only one class of","page_number":188,"box":{"x":78,"y":866,"width":818,"height":12}},{"id":"5d8672a7-aba5-4659-9b25-7ad92b621dc3","block_type":"box","text":"directors stands for election in any one year.","page_number":188,"box":{"x":69,"y":882,"width":315,"height":11}},{"id":"30d9a1d3-bc70-4cbd-8405-63ce521804ea","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":188,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"3580343b-0779-4f8a-a26b-c5bd5efd47ff","block_type":"box","text":"Global Engagement and Voting Guidelines | 7","page_number":188,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"9cc3b5de-e1aa-461c-b770-eeac27587ff0","block_type":"box","text":"NM1026U-5982568-188/232","page_number":188,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"c8fee354-28be-4ae4-b7eb-9726e6bb0e53","block_type":"box","text":"Committees","page_number":189,"box":{"x":70,"y":45,"width":84,"height":9}},{"id":"373879ca-be84-475e-9c7e-34741c8fa35b","block_type":"box","text":"Many boards establish committees to focus on specific responsibilities of the board such as audit and risk,","page_number":189,"box":{"x":102,"y":63,"width":766,"height":11}},{"id":"03bee086-0c29-448e-8a07-d2bf31c2c1ab","block_type":"box","text":"governance and human capital, and executive compensation, amongst other matters. We do not prescribe to","page_number":189,"box":{"x":68,"y":78,"width":776,"height":11}},{"id":"0d25715b-68d1-4be8-8d6a-79f3347e4d1a","block_type":"box","text":"companies what committees they should establish, but we seek to understand the board’s rationale for the","page_number":189,"box":{"x":69,"y":93,"width":766,"height":11}},{"id":"b1992671-b327-47e0-b270-a78771763f53","block_type":"box","text":"committee structure it determines is appropriate. We note that, in some markets, regulation requires such","page_number":189,"box":{"x":69,"y":108,"width":759,"height":11}},{"id":"c0d5371c-4315-4597-ae67-c8a4288a8a98","block_type":"box","text":"committees. The responsibilities of each committee should be clear, and the board should ensure that all critical","page_number":189,"box":{"x":69,"y":123,"width":804,"height":11}},{"id":"adf905de-749d-4383-9df3-dfe0755c0888","block_type":"box","text":"matters are assigned either to the full board or to one of the committees. It is helpful to investor understanding when","page_number":189,"box":{"x":69,"y":138,"width":837,"height":11}},{"id":"f95199d3-5c09-4a6d-b9bd-f9e158eed8dc","block_type":"box","text":"the board discloses the structure, membership, propor tion of independent directors, and responsibilities of each","page_number":189,"box":{"x":68,"y":152,"width":806,"height":11}},{"id":"9a9909b5-e006-4995-91ea-9cf981384b61","block_type":"box","text":"committee. The responsibilities we typically see assigned to the three most common committees include:","page_number":189,"box":{"x":69,"y":168,"width":752,"height":11}},{"id":"dcc65550-20ac-4717-b7af-b79b4da285eb","block_type":"box","text":"•","page_number":189,"box":{"x":69,"y":188,"width":6,"height":4}},{"id":"a71ac379-d3e3-48b2-9825-b6114056d172","block_type":"box","text":"Audit and risk – oversight responsibilities for the integrity of financial repor ting, risk management and","page_number":189,"box":{"x":101,"y":185,"width":722,"height":11}},{"id":"5ee5b001-b86b-4f6a-9097-503c75057eb3","block_type":"box","text":"compliance with legal and regulatory requirements; may also play an oversight role in relation to the internal","page_number":189,"box":{"x":101,"y":200,"width":771,"height":11}},{"id":"3c47ca3c-7a01-41c0-af4d-55c81c0e5cc5","block_type":"box","text":"audit function and whistleblowing mechanisms.","page_number":189,"box":{"x":102,"y":214,"width":335,"height":12}},{"id":"ec8fcced-5b3a-49bb-b572-f8f2eb63752e","block_type":"box","text":"•","page_number":189,"box":{"x":69,"y":235,"width":6,"height":4}},{"id":"b69a3e6c-582b-43f7-931a-c7e8de374ecc","block_type":"box","text":"Nominating, governance and human capital – oversight responsibilities for corporate governance principles and","page_number":189,"box":{"x":102,"y":232,"width":790,"height":11}},{"id":"84e6a425-8987-43d6-8517-fa7e9fbfcecc","block_type":"box","text":"practices of the company, including the periodic review of board per formance; responsibility for succession","page_number":189,"box":{"x":102,"y":247,"width":761,"height":11}},{"id":"2a81afb7-3718-48aa-a977-9a1b13447188","block_type":"box","text":"planning for CEO and key board roles, as well as the director appointment process; may also have oversight","page_number":189,"box":{"x":102,"y":262,"width":769,"height":11}},{"id":"0aa53105-f35f-4e65-9485-4affb6963c2b","block_type":"box","text":"responsibilities for human capital management strategies, including corporate culture and purpose.","page_number":189,"box":{"x":102,"y":276,"width":707,"height":12}},{"id":"41479f32-fb16-420d-a250-606cb0a32400","block_type":"box","text":"•","page_number":189,"box":{"x":69,"y":297,"width":6,"height":4}},{"id":"1a073099-0348-49dc-9a6b-a50ab744edf8","block_type":"box","text":"Executive compensation – determines the compensation policies and programs for the CEO and other executive","page_number":189,"box":{"x":102,"y":294,"width":796,"height":11}},{"id":"177b3517-a4ef-4552-8aa3-ed882e308f33","block_type":"box","text":"officers, approves annual awards and payments under the policies; may also have oversight responsibilities for","page_number":189,"box":{"x":102,"y":309,"width":793,"height":11}},{"id":"10768a51-206c-4903-af0e-9530902e3dd1","block_type":"box","text":"firm-wide compensation policies.","page_number":189,"box":{"x":101,"y":323,"width":232,"height":11}},{"id":"36cee8d7-cf7d-45ac-8306-66598fde5ad0","block_type":"box","text":"We may vote against the election of the chair of the committee or other directors serving as committee members","page_number":189,"box":{"x":101,"y":342,"width":807,"height":11}},{"id":"0b2acc18-87a2-4959-9bec-ff78297efa82","block_type":"box","text":"to convey concerns about how a committee has under taken its responsibilities. We may vote against the election of","page_number":189,"box":{"x":68,"y":357,"width":828,"height":11}},{"id":"e533675e-0736-4616-9cfb-9a446d109f98","block_type":"box","text":"the most senior non-executive director if there is not a clearly disclosed approach to board committees.","page_number":189,"box":{"x":68,"y":372,"width":738,"height":11}},{"id":"5a9af201-d1c4-4b0b-848a-c50935bc4233","block_type":"box","text":"Board and director evaluation","page_number":189,"box":{"x":70,"y":395,"width":209,"height":8}},{"id":"70352d9e-4797-4d4c-8e8f-45f30f73080f","block_type":"box","text":"We consider it best practice for companies to conduct an annual review of the per formance of the board, the","page_number":189,"box":{"x":101,"y":413,"width":776,"height":11}},{"id":"a0a60e89-3315-4f70-b1ee-ebcff1380165","block_type":"box","text":"committees, the chair and individual directors. Periodically, this review could be under taken by an independent third","page_number":189,"box":{"x":69,"y":428,"width":825,"height":11}},{"id":"6d79ff31-a591-47a5-a484-eacab5c9063e","block_type":"box","text":"par ty able to bring objective perspectives to the board on governance and per formance. We encourage companies to","page_number":189,"box":{"x":70,"y":443,"width":831,"height":11}},{"id":"95f4f5d6-b339-48bd-bb7c-248525d3b298","block_type":"box","text":"disclose their approach to and the objectives of evaluations, including any changes made to the board’s approach as","page_number":189,"box":{"x":69,"y":458,"width":835,"height":11}},{"id":"523c40dc-e7b7-4051-8c1b-314026ce0ea8","block_type":"box","text":"a result.","page_number":189,"box":{"x":69,"y":473,"width":57,"height":8}},{"id":"f3bb7176-917f-441b-9a4a-053345810885","block_type":"box","text":"Access to independent advice","page_number":189,"box":{"x":68,"y":495,"width":214,"height":11}},{"id":"d33e0b32-ff80-428b-8e57-fd5cb567416a","block_type":"box","text":"To suppor t the directors in effectively fulfilling their duties to the company and shareholders, they should have","page_number":189,"box":{"x":101,"y":513,"width":786,"height":12}},{"id":"b73360b9-a0d4-4665-a29a-261c9d2ef6a3","block_type":"box","text":"access to independent advice. In cer tain circumstances, it may be helpful to boards to retain independent third","page_number":189,"box":{"x":69,"y":528,"width":793,"height":11}},{"id":"a5a3f31e-7e84-4dd5-a856-917e17438f43","block_type":"box","text":"par ties to advise on critical matters. These might include new industry developments such as emergent and","page_number":189,"box":{"x":70,"y":543,"width":770,"height":11}},{"id":"43dfded6-72b5-484e-b50f-7236f46d210b","block_type":"box","text":"disruptive technology, operating events with material consequences for the company’s reputation and/or","page_number":189,"box":{"x":69,"y":558,"width":746,"height":11}},{"id":"6e5f4a06-c675-438e-a17e-03f577c5b63d","block_type":"box","text":"per formance, or significant transactions. Board committees may similarly retain third par ties to advise them on","page_number":189,"box":{"x":70,"y":573,"width":793,"height":11}},{"id":"7c90310e-2ef0-4776-b2c8-4ae1f5f6e177","block_type":"box","text":"specialist matters such as audit, compensation and succession planning.","page_number":189,"box":{"x":69,"y":588,"width":524,"height":11}},{"id":"31c45ad7-1463-46bb-9f97-3d46f0fbc92f","block_type":"box","text":"EXECUTIVE COMPENSATION","page_number":189,"box":{"x":385,"y":618,"width":207,"height":9}},{"id":"93c34f9c-df36-4de6-993b-a5cdccaa901b","block_type":"box","text":"Boards play an impor tant role in establishing compensation arrangements that enable the company to recruit,","page_number":189,"box":{"x":102,"y":637,"width":784,"height":11}},{"id":"c9fe39e0-e810-43cb-955b-b59669baaf1c","block_type":"box","text":"retain and reward the caliber of executive management necessary to lead and operate the company to deliver","page_number":189,"box":{"x":69,"y":652,"width":782,"height":11}},{"id":"75dc9e53-e334-4cf2-8e68-318cc2391050","block_type":"box","text":"superior financial returns over time. We focus on alignment between variable pay and a company’s financial","page_number":189,"box":{"x":69,"y":666,"width":766,"height":12}},{"id":"ad5bd212-21b2-44b3-8586-f840e391a1b1","block_type":"box","text":"per formance.","page_number":189,"box":{"x":70,"y":681,"width":93,"height":11}},{"id":"e4173b41-2961-48e3-99ff-bd1f46028a96","block_type":"box","text":"Generally, executive compensation arrangements have four components: base salary, annual bonus that rewards","page_number":189,"box":{"x":102,"y":700,"width":805,"height":11}},{"id":"12691a56-6345-4bec-ac6f-4d99437faf9b","block_type":"box","text":"per formance against shor t-term metrics, incentives – most often share-based that reward per formance against long","page_number":189,"box":{"x":70,"y":715,"width":831,"height":11}},{"id":"2d20de0f-b2d0-4c8a-b03a-5d928738eba2","block_type":"box","text":"term metrics, and pensions and benefits. In our observation, base salary, pensions and benefits are largely set","page_number":189,"box":{"x":68,"y":730,"width":798,"height":11}},{"id":"b64f7148-9cd2-4498-8f43-174023e3c449","block_type":"box","text":"relative to market norms and benchmarks. The annual bonus and share-based incentive, or variable pay plans, tend","page_number":189,"box":{"x":69,"y":745,"width":824,"height":11}},{"id":"d20676a2-9c40-49b1-92c4-deae649e9256","block_type":"box","text":"to be tailored to the company, its sector and long-term strategy, as well as the individuals the board is seeking to","page_number":189,"box":{"x":68,"y":760,"width":807,"height":11}},{"id":"739c1299-8e8a-4329-a197-47c7ccc59e70","block_type":"box","text":"recruit and motivate.","page_number":189,"box":{"x":69,"y":774,"width":146,"height":9}},{"id":"e496788a-4a52-4b16-9c48-b1c58dc7372a","block_type":"box","text":"Recognizing the unique circumstances of each company, we determine whether to suppor t a company’s","page_number":189,"box":{"x":102,"y":793,"width":739,"height":11}},{"id":"47452fd6-7586-4f42-8ab5-f0237f939374","block_type":"box","text":"approach to executive compensation on a case-by-case basis. We rely on companies providing sufficient quantitative","page_number":189,"box":{"x":69,"y":808,"width":831,"height":11}},{"id":"39e66595-7a67-4af9-84fc-778e6ee5c11f","block_type":"box","text":"and qualitative information in their disclosures to enable shareholders to understand the compensation","page_number":189,"box":{"x":69,"y":823,"width":737,"height":11}},{"id":"d22514a3-b8b2-479e-9de9-5e4ac88ff356","block_type":"box","text":"arrangements and assess the alignment with investors’ interests. Features we look for in compensation","page_number":189,"box":{"x":69,"y":837,"width":741,"height":12}},{"id":"94ebdbee-061f-42bb-9376-e2afd721815d","block_type":"box","text":"arrangements include:","page_number":189,"box":{"x":69,"y":853,"width":157,"height":11}},{"id":"a59a8880-97b5-4427-8568-abc7797af286","block_type":"box","text":"•","page_number":189,"box":{"x":69,"y":873,"width":6,"height":4}},{"id":"7db95d81-361b-40b4-a5af-5437b8930517","block_type":"box","text":"Fixed pay components, including base salary, benefits and prerequisites that are appropriate in the context of","page_number":189,"box":{"x":102,"y":870,"width":783,"height":11}},{"id":"20f52096-e027-42fa-9086-d55576e16550","block_type":"box","text":"the company’s size, sector and market.","page_number":189,"box":{"x":101,"y":885,"width":280,"height":11}},{"id":"ed50ff1f-f8de-4444-85c4-83485d19a444","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":189,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"b3fd4c1b-73db-413f-b57d-2c68fd6bfcd4","block_type":"box","text":"Global Engagement and Voting Guidelines | 8","page_number":189,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"41f9ca75-f56d-4d12-ac06-474e54da77a5","block_type":"box","text":"NM1026U-5982568-189/232","page_number":189,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"9bbf07f3-c54b-4e96-924a-2b94dacd4408","block_type":"box","text":"•","page_number":190,"box":{"x":69,"y":48,"width":6,"height":4}},{"id":"c5030e56-d9f1-4311-ad45-10817ba053f3","block_type":"box","text":"Variable pay subject to per formance metrics that are closely linked to the company’s shor t- and long-term","page_number":190,"box":{"x":101,"y":45,"width":752,"height":11}},{"id":"67c2b61f-2305-49b9-8480-f4e9a589719f","block_type":"box","text":"strategic objectives.","page_number":190,"box":{"x":102,"y":60,"width":140,"height":11}},{"id":"c1b01634-3541-4c88-83ad-cbcc736d495d","block_type":"box","text":"•","page_number":190,"box":{"x":69,"y":80,"width":6,"height":4}},{"id":"b2c429af-c74c-404e-a17e-e66ce20e4942","block_type":"box","text":"Long-term incentives that motivate sustained per formance across a multi-year period.","page_number":190,"box":{"x":102,"y":77,"width":609,"height":11}},{"id":"795c3085-7498-4fe3-994c-d0a4ef905582","block_type":"box","text":"•","page_number":190,"box":{"x":69,"y":97,"width":6,"height":5}},{"id":"50318c6c-44ef-4931-8093-9c24f79fd3bc","block_type":"box","text":"A balance between fixed and variable pay, shor t- and long-term incentives, and specific instruments (cash and","page_number":190,"box":{"x":101,"y":94,"width":784,"height":12}},{"id":"c61494ac-c0a1-426a-8ca4-2cb29d3eaf54","block_type":"box","text":"equity awards) that promotes pay program durability and seldom necessitates one-off, discretionary payments.","page_number":190,"box":{"x":101,"y":109,"width":790,"height":11}},{"id":"b3c47052-f67c-4ae8-bad8-d6f1dc87508d","block_type":"box","text":"•","page_number":190,"box":{"x":69,"y":129,"width":6,"height":5}},{"id":"bb40484f-c3f8-4210-b98e-3c0dfe3b8993","block_type":"box","text":"Pay outcomes that are consistent with the returns to investors over the relevant time period.","page_number":190,"box":{"x":102,"y":127,"width":658,"height":11}},{"id":"75e3d3de-548c-4a5d-bb60-1acfc4364958","block_type":"box","text":"•","page_number":190,"box":{"x":69,"y":147,"width":6,"height":4}},{"id":"27a18e23-6d97-4b8b-8408-b16761cb0085","block_type":"box","text":"Board discretion, if allowed within the variable pay arrangements, to be used sparingly, responsibly and","page_number":190,"box":{"x":102,"y":144,"width":735,"height":11}},{"id":"124851aa-8ae0-455d-8bd2-a469d2fbe360","block_type":"box","text":"transparently.","page_number":190,"box":{"x":101,"y":159,"width":95,"height":11}},{"id":"a9eddd01-1292-4e9b-9c15-b39dc1bbb6ac","block_type":"box","text":"•","page_number":190,"box":{"x":69,"y":179,"width":6,"height":5}},{"id":"5f3df533-4351-4494-9330-ae91bc181bc6","block_type":"box","text":"A requirement, that par ticipants in long-term share-based incentive plans build a meaningful shareholding in the","page_number":190,"box":{"x":101,"y":176,"width":798,"height":11}},{"id":"5a5339fd-be8c-4c16-8fd0-e7ef0d3b5631","block_type":"box","text":"company within a defined time period, as determined by the board or relevant board committee.","page_number":190,"box":{"x":101,"y":191,"width":683,"height":11}},{"id":"983b2909-6e3e-48dd-9218-27e254e1726e","block_type":"box","text":"•","page_number":190,"box":{"x":69,"y":211,"width":6,"height":5}},{"id":"1217308a-a093-4a51-872e-d939bac92c13","block_type":"box","text":"Change of control provisions that appropriately balance the interests of executives and shareholders.","page_number":190,"box":{"x":102,"y":208,"width":720,"height":12}},{"id":"c5a58eb2-95b0-4775-8268-cedc5da89fd2","block_type":"box","text":"•","page_number":190,"box":{"x":69,"y":229,"width":6,"height":4}},{"id":"9fba62a4-b7b2-4773-a5c4-ce469e257afe","block_type":"box","text":"Clawback or malus provisions that allow the company to recoup or hold back variable compensation from","page_number":190,"box":{"x":102,"y":226,"width":747,"height":11}},{"id":"6dfbaf93-3416-4625-aa55-8484e8d69bac","block_type":"box","text":"individuals whose awards were based on fraudulent activities, misstated financial repor ts, or executive","page_number":190,"box":{"x":102,"y":241,"width":733,"height":11}},{"id":"ae6692e8-91f9-4041-bcf9-cdb533b9cd9b","block_type":"box","text":"misconduct.","page_number":190,"box":{"x":102,"y":256,"width":84,"height":8}},{"id":"0a3b4d8a-8cf8-487e-9bcc-494d51b2d752","block_type":"box","text":"•","page_number":190,"box":{"x":69,"y":276,"width":6,"height":4}},{"id":"e463e12c-7b38-4796-8fea-fea68ffa31c4","block_type":"box","text":"Severance arrangements that protect the company’s interests but do not cost more than is contractual.","page_number":190,"box":{"x":102,"y":273,"width":738,"height":11}},{"id":"e1051134-83ab-4265-88a4-c3da72911a15","block_type":"box","text":"We may vote against proposals to introduce new share-based incentives, approve existing policies or plans, or","page_number":190,"box":{"x":101,"y":292,"width":787,"height":11}},{"id":"8021425d-0dc1-4965-b954-d5cf349dd835","block_type":"box","text":"approve the compensation repor t where we do not see alignment between executive compensation arrangements","page_number":190,"box":{"x":69,"y":307,"width":810,"height":11}},{"id":"7140f234-0b7c-4727-995f-a3244c67c850","block_type":"box","text":"and our clients’ financial interests. When there is not an alternative, or where there have been multi-year issues with","page_number":190,"box":{"x":69,"y":321,"width":831,"height":11}},{"id":"44c4a2ba-b84c-4ad4-ae67-6e3672d41502","block_type":"box","text":"compensation misaligned with per formance, we may vote against the election of the chair of the responsible","page_number":190,"box":{"x":69,"y":336,"width":775,"height":11}},{"id":"277183ce-5956-4e48-aecb-5701af8cbd04","block_type":"box","text":"committee, or the most senior independent director.","page_number":190,"box":{"x":69,"y":351,"width":371,"height":11}},{"id":"d7764da6-3fff-4287-b987-2b7e13d3c7c5","block_type":"box","text":"NON-EXECUTIVE DIRECTOR COMPENSATION","page_number":190,"box":{"x":326,"y":381,"width":325,"height":9}},{"id":"d11fb117-fa35-4155-bfd3-18bff3bad18f","block_type":"box","text":"Companies generally pay non-executive directors an annual retainer or fee in cash, shares or a combination of","page_number":190,"box":{"x":102,"y":400,"width":785,"height":11}},{"id":"ee429fc0-c06d-48bf-b4ca-4dbab914bbf1","block_type":"box","text":"the two. Some companies also pay additional fees for service on board committees or in board leadership roles. We","page_number":190,"box":{"x":68,"y":415,"width":831,"height":11}},{"id":"2c43f297-a95c-4804-897b-aac5c99598d2","block_type":"box","text":"do not suppor t non-executive directors par ticipating in per formance-based incentive plans as doing so may create a","page_number":190,"box":{"x":69,"y":430,"width":825,"height":11}},{"id":"b622a652-f4d5-414f-8b06-7a1027ec0f3f","block_type":"box","text":"conflict of interest and undermine their independence from management, whom they oversee.","page_number":190,"box":{"x":69,"y":444,"width":668,"height":12}},{"id":"a3eb2a1f-8b2d-4394-b146-08ce7e0c0ae5","block_type":"box","text":"CAPITAL STRUCTURE","page_number":190,"box":{"x":411,"y":475,"width":156,"height":8}},{"id":"e6eccda6-ccef-46dc-bde6-1c2f6dffde99","block_type":"box","text":"Boards are responsible for ensuring senior executive leadership has established a capital strategy that achieves","page_number":190,"box":{"x":102,"y":493,"width":800,"height":12}},{"id":"87356dae-f630-409b-94a9-1473eae2c9d2","block_type":"box","text":"appropriate capital allocation in suppor t of long-term financial resilience.","page_number":190,"box":{"x":69,"y":508,"width":516,"height":11}},{"id":"3ecbebd3-ea69-4494-ace7-8d8383dc5485","block_type":"box","text":"Where company practices diverge from those set out below, we look for companies to disclose why they view","page_number":190,"box":{"x":101,"y":527,"width":776,"height":11}},{"id":"cda83f0c-8d53-4eae-9201-0fbd4a74a016","block_type":"box","text":"these practices to be aligned with shareholders’ interests. We may vote against management proposals seeking","page_number":190,"box":{"x":68,"y":542,"width":803,"height":11}},{"id":"9ced29a2-dfd6-4668-b4e4-9e131aa9d782","block_type":"box","text":"capital-related authorities, or the election of the most senior independent director, if we have concerns about a","page_number":190,"box":{"x":69,"y":557,"width":790,"height":11}},{"id":"858fb0c0-82dd-4b5e-ab0c-be8a63bf0625","block_type":"box","text":"company’s approach. We may also suppor t a shareholder proposal seeking conversion of shares with differentiated","page_number":190,"box":{"x":69,"y":571,"width":825,"height":12}},{"id":"91587ad2-a367-48ea-9b96-a491471311c3","block_type":"box","text":"voting rights to a one-share, one-vote standard.","page_number":190,"box":{"x":68,"y":587,"width":336,"height":11}},{"id":"b1cd6c48-c44c-4be6-9c70-28a86120d003","block_type":"box","text":"Share issuance","page_number":190,"box":{"x":68,"y":609,"width":111,"height":9}},{"id":"e77adaed-8da3-48cc-9ad2-637ccf2d6f59","block_type":"box","text":"We assess requests for share issuance for par ticular transactions on a case-by-case basis. We will generally","page_number":190,"box":{"x":101,"y":627,"width":776,"height":12}},{"id":"a70df368-31d6-4dcb-951a-0be482f130da","block_type":"box","text":"suppor t authorities to issue shares when subject to pre-emptive rights, and up to 20% absent pre-emptive rights. We","page_number":190,"box":{"x":69,"y":642,"width":832,"height":12}},{"id":"14a277ae-c9d4-4f87-b337-7e1aef5f2ae1","block_type":"box","text":"consider it good practice for companies to seek regular approval of these authorities to allow shareholders to take","page_number":190,"box":{"x":69,"y":657,"width":815,"height":11}},{"id":"d0976711-10f0-4a95-aeac-1f9bf6acfa75","block_type":"box","text":"into consideration how prior authorities were used, as well as the current circumstances of the company and the","page_number":190,"box":{"x":70,"y":672,"width":802,"height":11}},{"id":"3b3da6df-155c-40ee-b520-a731b53f32b7","block_type":"box","text":"market environment.","page_number":190,"box":{"x":69,"y":687,"width":145,"height":9}},{"id":"7c0c3988-adb6-45df-a2cb-0c355e4628ae","block_type":"box","text":"Share buybacks","page_number":190,"box":{"x":68,"y":709,"width":116,"height":11}},{"id":"50156ae4-638e-447a-b218-76a9f0c599b3","block_type":"box","text":"We assess share buyback proposals in the context of the company’s disclosed capital management strategy and","page_number":190,"box":{"x":101,"y":728,"width":806,"height":11}},{"id":"d4797f1d-f2c0-41ca-bf99-753365eea129","block_type":"box","text":"management’s determination of the appropriate balance between investment that suppor ts the long-term growth of","page_number":190,"box":{"x":69,"y":743,"width":823,"height":11}},{"id":"df2c1f5d-5804-4186-95ff-2a6f653f2dfa","block_type":"box","text":"the company and returning cash to investors. We also take into consideration the effect of a buyback program on the","page_number":190,"box":{"x":68,"y":758,"width":836,"height":11}},{"id":"b8d39234-5c04-40d9-b4ab-25a5ef883841","block_type":"box","text":"company’s balance sheet and executive compensation arrangements and the price at which shares are repurchased","page_number":190,"box":{"x":69,"y":773,"width":830,"height":11}},{"id":"88d4f483-38a3-405d-a4a7-7c2d39677bf9","block_type":"box","text":"relative to market price. We consider it good practice for companies to seek regular approval of these authorities to","page_number":190,"box":{"x":69,"y":787,"width":822,"height":12}},{"id":"82f3dceb-aeb0-47a5-97a3-5962c6f22242","block_type":"box","text":"allow shareholders to take into consideration how prior authorities were used, as well as the current circumstances","page_number":190,"box":{"x":69,"y":802,"width":823,"height":11}},{"id":"673feb33-9e7e-4098-b592-d273b460b0c7","block_type":"box","text":"of the company and the market environment.","page_number":190,"box":{"x":69,"y":817,"width":319,"height":11}},{"id":"c9a5a573-2454-4340-b249-85d4e7d025c3","block_type":"box","text":"Dividends","page_number":190,"box":{"x":69,"y":840,"width":69,"height":8}},{"id":"e9e10695-5fa6-4547-8b9b-8e0c51c4509d","block_type":"box","text":"We generally defer to management and the board on dividend policy but may engage to seek fur ther clarification","page_number":190,"box":{"x":101,"y":858,"width":799,"height":11}},{"id":"ca10e6a3-fbcd-4782-b4e6-e1a3dde17221","block_type":"box","text":"where a proposed dividend appears out of line with the company’s financial position.","page_number":190,"box":{"x":68,"y":873,"width":604,"height":11}},{"id":"dd355f06-374d-4f78-9518-d42c86640bda","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":190,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"41dc3381-fc9b-49fc-afc6-da681a511bf3","block_type":"box","text":"Global Engagement and Voting Guidelines | 9","page_number":190,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"321cab90-8e08-49ee-a20f-cd0079b2c0b3","block_type":"box","text":"NM1026U-5982568-190/232","page_number":190,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"498ed8c0-4648-40ea-aa5e-390f0a0c2537","block_type":"box","text":"Differentiated voting rights","page_number":191,"box":{"x":69,"y":45,"width":196,"height":11}},{"id":"29123200-1c50-4977-a914-d20a8c9a216f","block_type":"box","text":"We prefer companies to adopt a one-share, one-vote structure for share classes with the same economic","page_number":191,"box":{"x":101,"y":63,"width":750,"height":11}},{"id":"d64c83cd-e2df-4071-8048-e457961039aa","block_type":"box","text":"exposure. Cer tain companies, par ticularly those new to public markets, could make the case to adopt a","page_number":191,"box":{"x":69,"y":78,"width":740,"height":11}},{"id":"c92dde7e-4a60-44fb-9824-6a65deefcd26","block_type":"box","text":"differentiated voting rights structure, or dual class stock. In those situations, we encourage companies to evaluate","page_number":191,"box":{"x":69,"y":93,"width":819,"height":11}},{"id":"c9c31513-793f-4bc6-9651-8cec95ba4f1f","block_type":"box","text":"and seek approval for their capital structure on a periodic basis.","page_number":191,"box":{"x":69,"y":108,"width":456,"height":11}},{"id":"3123171e-0b8f-4ce8-b5be-788fb5bc8629","block_type":"box","text":"TRANSACTIONS AND SPECIAL SITUATIONS","page_number":191,"box":{"x":332,"y":138,"width":314,"height":9}},{"id":"130d942c-c625-4ce2-b720-743a7db8ddcb","block_type":"box","text":"We monitor developments in transactions and special situations closely and under take our own detailed","page_number":191,"box":{"x":101,"y":157,"width":743,"height":11}},{"id":"5ae33216-4d9e-4d2f-98f5-e378c15dd307","block_type":"box","text":"analyses of proposals.","page_number":191,"box":{"x":69,"y":172,"width":159,"height":11}},{"id":"6da886b3-e4fb-4a2e-a9f2-e4401528a532","block_type":"box","text":"Mergers and acquisitions","page_number":191,"box":{"x":69,"y":194,"width":184,"height":11}},{"id":"cd0042c2-5c17-4ac8-ad11-2347ae192082","block_type":"box","text":"We evaluate proposed mergers or acquisitions by assessing the financial outcome for our clients as minority","page_number":191,"box":{"x":101,"y":213,"width":775,"height":11}},{"id":"f8081074-298a-4379-971f-be7bdc261628","block_type":"box","text":"shareholders. Management should provide an assessment of the proposed transaction’s strategic and financial","page_number":191,"box":{"x":69,"y":228,"width":797,"height":11}},{"id":"10664c81-0db9-4b27-aef3-34058b06a3d5","block_type":"box","text":"rationale, along with its execution and operational risks. We review each transaction independently based on these","page_number":191,"box":{"x":69,"y":243,"width":819,"height":11}},{"id":"c5a7844d-b48a-4d6f-9fb6-a7b69c7981b3","block_type":"box","text":"factors and the degree to which the transaction enhances shareholder value. The board might consider establishing","page_number":191,"box":{"x":68,"y":257,"width":827,"height":12}},{"id":"4c340ea3-d39d-4860-bb22-1edfa41c92eb","block_type":"box","text":"an ad hoc transaction committee to under take an independent assessment of a significant merger or acquisition, in","page_number":191,"box":{"x":69,"y":272,"width":827,"height":11}},{"id":"4e62edf7-821f-4858-8b2a-134a39c27a16","block_type":"box","text":"advance of making its recommendation to shareholders.","page_number":191,"box":{"x":69,"y":287,"width":400,"height":11}},{"id":"b8fae25a-0537-4830-9c12-102e7960474a","block_type":"box","text":"We will vote against transactions that, in our assessment, do not advance our clients’ financial interests.","page_number":191,"box":{"x":101,"y":306,"width":749,"height":11}},{"id":"683f7174-a4a0-43e5-9527-cf596f6901f8","block_type":"box","text":"Anti-takeover defenses","page_number":191,"box":{"x":68,"y":328,"width":167,"height":9}},{"id":"9e83c01d-5aa2-4204-ace5-94d5e334af38","block_type":"box","text":"In principle, we do not suppor t companies using anti-takeover defenses, also known as poison pills or","page_number":191,"box":{"x":102,"y":347,"width":727,"height":11}},{"id":"3c9686bc-147d-4380-abea-f2cb8251cf2d","block_type":"box","text":"shareholder rights plans, as they can entrench management and boards which have not delivered long-term","page_number":191,"box":{"x":69,"y":362,"width":766,"height":11}},{"id":"572b2572-db78-4697-aa7c-41d442bcf4c2","block_type":"box","text":"shareholder value. By exception, a poison pill may be suppor ted if its purpose is to delay a takeover that is","page_number":191,"box":{"x":69,"y":376,"width":763,"height":12}},{"id":"79be564b-bf4c-4d9b-9e0e-28d63f53940a","block_type":"box","text":"considered sub-optimal and enable management to seek an improved offer. Similarly, management could make the","page_number":191,"box":{"x":69,"y":391,"width":821,"height":12}},{"id":"71d21466-7296-45c3-a128-e5e0c2501c4b","block_type":"box","text":"case to use a poison pill to block a shareholder activism campaign that may be counter to the interests of other","page_number":191,"box":{"x":69,"y":406,"width":799,"height":11}},{"id":"8c0c8f99-4538-4b52-9c7c-e41469201941","block_type":"box","text":"investors. Defense mechanisms introduced in these circumstances should be limited in term and threshold, and also","page_number":191,"box":{"x":70,"y":421,"width":836,"height":11}},{"id":"3a187b1b-e633-4c12-8607-9ba616c93f56","block_type":"box","text":"be closely monitored by the independent members of the board. We consider it good practice for companies to put to","page_number":191,"box":{"x":69,"y":436,"width":835,"height":11}},{"id":"e745d2ba-cc49-4b36-b54b-b773b31133e9","block_type":"box","text":"a shareholder vote any mechanisms expected to be in place for more than 12 months.","page_number":191,"box":{"x":69,"y":451,"width":616,"height":11}},{"id":"6f79932f-fd6a-427b-882f-808bf0dc1687","block_type":"box","text":"Shareholder activism","page_number":191,"box":{"x":68,"y":473,"width":153,"height":9}},{"id":"7e9bc4fa-00dc-43e0-b63d-8d31d528964e","block_type":"box","text":"When companies are the focus of an activism campaign, we may communicate with the activist to understand","page_number":191,"box":{"x":101,"y":492,"width":783,"height":11}},{"id":"6006fc65-178e-4b99-a9f6-c6a96ef03e34","block_type":"box","text":"their analysis and objectives, once they have publicly disclosed their campaign. We may also engage with company","page_number":191,"box":{"x":68,"y":507,"width":819,"height":11}},{"id":"f2d0ed39-0e42-432b-a8d8-3f221bec6a86","block_type":"box","text":"management and possibly board members, especially those the activist may be seeking to replace. In our","page_number":191,"box":{"x":69,"y":522,"width":755,"height":11}},{"id":"74f70e89-beb0-47d8-8e96-877f6776d931","block_type":"box","text":"assessment, we evaluate various factors, including the concerns raised by the activist and the case for change; the","page_number":191,"box":{"x":69,"y":536,"width":824,"height":12}},{"id":"fb0d2b1f-e164-45e5-b589-fb78d3d847f0","block_type":"box","text":"quality of both the activist’s and management’s plans; and the qualifications of each par ty’s candidates. We evaluate","page_number":191,"box":{"x":69,"y":551,"width":839,"height":12}},{"id":"18f0381a-daff-49f8-8d9e-f004e293f982","block_type":"box","text":"each contested situation by assessing the potential financial outcome for our clients as minority shareholders.","page_number":191,"box":{"x":69,"y":566,"width":788,"height":11}},{"id":"7ca0df73-3303-49eb-abba-e9d116ffcff1","block_type":"box","text":"We may suppor t board candidates nominated by a shareholder activist if BAIS, in its independent judgment, or","page_number":191,"box":{"x":101,"y":585,"width":789,"height":11}},{"id":"a3bb2aaf-b519-4875-ae1b-8a65ab748a0a","block_type":"box","text":"the relevant por tfolio manager has determined that there is a case for change to enhance shareholder value, or if the","page_number":191,"box":{"x":68,"y":600,"width":839,"height":11}},{"id":"869d027f-3da7-4d51-82f2-f254ce265f79","block_type":"box","text":"incumbent board members do not demonstrate the relevant skills and exper tise or have a poor track record of","page_number":191,"box":{"x":70,"y":614,"width":786,"height":11}},{"id":"a448ea04-65ca-42ae-b20c-586beb9afb2a","block_type":"box","text":"protecting shareholders’ interests.","page_number":191,"box":{"x":70,"y":630,"width":244,"height":11}},{"id":"2aca9eaf-6b70-493a-85fb-a876467c8664","block_type":"box","text":"Significant shareholders and related party transactions","page_number":191,"box":{"x":68,"y":652,"width":403,"height":11}},{"id":"74fc510d-e80e-4570-979e-4b68d4fe71c2","block_type":"box","text":"Boards of companies with affiliated shareholders or directors should give equitable consideration to the","page_number":191,"box":{"x":102,"y":670,"width":740,"height":12}},{"id":"1cb97bea-f157-4165-a975-cb6be004f491","block_type":"box","text":"interests of all shareholders when evaluating related par ty transactions.","page_number":191,"box":{"x":70,"y":685,"width":511,"height":12}},{"id":"8ec400c0-32a9-4d4d-9718-b5b40c5443a4","block_type":"box","text":"We consider it good practice for transactions with related par ties, such as significant shareholders or companies","page_number":191,"box":{"x":101,"y":704,"width":805,"height":11}},{"id":"bf4d344e-1a54-4422-91a8-06ed6ec4753a","block_type":"box","text":"affiliated with the public company, to be disclosed in detail and conducted on terms similar to what would objectively","page_number":191,"box":{"x":69,"y":719,"width":832,"height":11}},{"id":"9921b996-3ca2-42e7-ba00-25436f209495","block_type":"box","text":"have been agreed with a non-related par ty. In our view, such transactions should be reviewed and approved by the","page_number":191,"box":{"x":69,"y":734,"width":812,"height":11}},{"id":"38c7db02-92f2-4eaf-a2b1-20bd5d3a4830","block_type":"box","text":"independent members of the board, and if voted on, only disinterested shareholders should vote.","page_number":191,"box":{"x":70,"y":748,"width":692,"height":12}},{"id":"a685ddcf-ea04-465d-b9de-9668a3d2b798","block_type":"box","text":"CORPORATE REPORTING, RISK MANAGEMENT AND AUDIT","page_number":191,"box":{"x":274,"y":779,"width":430,"height":10}},{"id":"c38fd782-f0f2-4005-bbd2-97d81b84dfee","block_type":"box","text":"Investors depend on corporate repor ting, both regulatory and voluntary, to understand a company’s strategy, its","page_number":191,"box":{"x":102,"y":798,"width":796,"height":11}},{"id":"9fd4adfe-140e-4631-b36b-443f11e9b0f0","block_type":"box","text":"implementation and financial per formance, as well as to assess the quality of management and operations and","page_number":191,"box":{"x":70,"y":812,"width":795,"height":12}},{"id":"170b704b-37ee-42ef-87ba-6de817b96ebe","block_type":"box","text":"potential for the company to create shareholder value over time. We consider it good practice for the board to","page_number":191,"box":{"x":70,"y":827,"width":779,"height":11}},{"id":"f48378ac-09f4-4910-85fc-3310ee41a4e4","block_type":"box","text":"oversee corporate repor ting and the policies and procedures underpinning the internal audit function and external","page_number":191,"box":{"x":69,"y":842,"width":809,"height":11}},{"id":"466a37cf-1673-4f22-ae1a-142944d9453e","block_type":"box","text":"audit.","page_number":191,"box":{"x":69,"y":857,"width":38,"height":9}},{"id":"dc032787-c5fe-4474-84eb-e5d1cf829b85","block_type":"box","text":"A company’s financial repor ting should provide decision-useful information for investors, and other stakeholders,","page_number":191,"box":{"x":101,"y":875,"width":803,"height":12}},{"id":"a404a282-8b13-4ec9-989c-691426d6b853","block_type":"box","text":"on its financial per formance and position. It should provide an accurate and balanced assessment of the risks and","page_number":191,"box":{"x":69,"y":890,"width":819,"height":11}},{"id":"9a74ab28-f7de-4b90-9c68-c4febce10e42","block_type":"box","text":"oppor tunities the company faces in realizing its long-term strategy. Accordingly, the assumptions made by","page_number":191,"box":{"x":69,"y":905,"width":752,"height":12}},{"id":"58fefc6b-827b-4f64-8c49-71e031ba4c52","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":191,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"3133331e-25da-4c04-b9ea-bfe9c7c0d8bc","block_type":"box","text":"Global Engagement and Voting Guidelines | 10","page_number":191,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"fced83d1-535a-467c-9f75-85534403453a","block_type":"box","text":"NM1026U-5982568-191/232","page_number":191,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"012c8b96-6989-4302-b9e8-936e062d0443","block_type":"box","text":"management and reviewed by the auditor in preparing the financial statements should be reasonable and justified.","page_number":192,"box":{"x":69,"y":45,"width":817,"height":11}},{"id":"ed6b20d1-ec33-46a2-9508-137d20e97c19","block_type":"box","text":"Financial statements should be prepared in accordance with globally developed repor ting standards and any","page_number":192,"box":{"x":70,"y":60,"width":771,"height":11}},{"id":"22e271bb-2add-4729-83ef-bba5f24caef4","block_type":"box","text":"divergence from generally accepted accounting principles should be explained in detail and justified. Accounting","page_number":192,"box":{"x":69,"y":74,"width":796,"height":12}},{"id":"18dee2f8-d2de-408a-9941-f7fdb25a6976","block_type":"box","text":"restatements should be explained in detail and any remedial actions, and the implications of these, disclosed.","page_number":192,"box":{"x":69,"y":89,"width":788,"height":11}},{"id":"c4ac205f-f2bd-4637-882b-703dcffe9224","block_type":"box","text":"In this context, audit committees play a vital role in a company’s financial repor ting system by providing","page_number":192,"box":{"x":102,"y":108,"width":739,"height":11}},{"id":"981ab793-9c99-4b01-9ad8-f439902df194","block_type":"box","text":"independent oversight of the accounts, material financial and, where appropriate to the jurisdiction, non-financial","page_number":192,"box":{"x":70,"y":123,"width":801,"height":11}},{"id":"1d8b480a-6e05-42dc-8b28-e3bc410f4b39","block_type":"box","text":"information, internal control frameworks and Enterprise Risk Management systems. In our view, effective audit","page_number":192,"box":{"x":70,"y":138,"width":787,"height":11}},{"id":"6b1b9c99-31c4-4035-af48-6f2b83c667ed","block_type":"box","text":"committee oversight strengthens the quality and reliability of a company’s financial statements and provides an","page_number":192,"box":{"x":69,"y":152,"width":795,"height":12}},{"id":"2dceec6a-aebc-4683-8d33-ddba8d102f6f","block_type":"box","text":"impor tant level of reassurance to shareholders. Audit committees should have a procedure in place for assessing the","page_number":192,"box":{"x":70,"y":167,"width":838,"height":12}},{"id":"a6291344-0f3d-406e-9f86-afccba022d20","block_type":"box","text":"independence of the auditor and the quality of the external audit process annually.","page_number":192,"box":{"x":70,"y":182,"width":585,"height":11}},{"id":"0f5e5927-841a-40c5-a855-fa8b6355b3db","block_type":"box","text":"Similarly, we encourage companies to disclose material sustainability-related factors that are integral to how a","page_number":192,"box":{"x":102,"y":201,"width":784,"height":11}},{"id":"7a202b7a-fb7d-4938-b43a-8caae2fda593","block_type":"box","text":"company manages risks or generates revenue. BAIS finds it helpful to our understanding when companies provide","page_number":192,"box":{"x":69,"y":216,"width":812,"height":11}},{"id":"009a8a44-bc82-4360-bc53-cfeb9a462326","block_type":"box","text":"robust, standardized disclosures on their material sustainability-related risks and oppor tunities. The International","page_number":192,"box":{"x":69,"y":231,"width":806,"height":11}},{"id":"6657d63c-a80d-4c7c-9cc3-cf3d0adbf2c4","block_type":"box","text":"Sustainability Standards Board (ISSB) is one entity working to meet these objectives through its repor ting standards,","page_number":192,"box":{"x":69,"y":246,"width":832,"height":11}},{"id":"fbce446b-9a6e-4be7-a625-542d1060fa89","block_type":"box","text":"which may be helpful to companies in preparing such repor ts.","page_number":192,"box":{"x":68,"y":260,"width":440,"height":12}},{"id":"38399ba0-8590-445b-8685-df925b26aeb0","block_type":"box","text":"9","page_number":192,"box":{"x":509,"y":261,"width":5,"height":4}},{"id":"2d3a9b65-e54c-4d9a-9250-61fedb686525","block_type":"box","text":"However, we do not mandate any specific disclosure","page_number":192,"box":{"x":520,"y":260,"width":372,"height":11}},{"id":"d2fb7629-a9e7-4c15-b979-97dbeb8a59a5","block_type":"box","text":"framework, and note that companies in cer tain jurisdictions are subject to mandatory repor ting requirements under","page_number":192,"box":{"x":68,"y":275,"width":824,"height":11}},{"id":"9cb06065-aac0-40df-9de9-7370d947bfd5","block_type":"box","text":"standards specified by policy makers.","page_number":192,"box":{"x":69,"y":290,"width":267,"height":11}},{"id":"25bcfe82-e802-4cd7-a24b-bf5c11ae14e1","block_type":"box","text":"10","page_number":192,"box":{"x":338,"y":290,"width":9,"height":5}},{"id":"58d2546b-8585-496b-a5c0-c824558f0054","block_type":"box","text":"Companies should establish robust risk management and internal control processes appropriate to the","page_number":192,"box":{"x":102,"y":309,"width":735,"height":11}},{"id":"be9ffa87-7eb9-4cc0-944f-0b1254ddcd6b","block_type":"box","text":"company’s business, risk tolerance, and regulatory environment. A credible whistleblowing system for employees,","page_number":192,"box":{"x":69,"y":323,"width":810,"height":12}},{"id":"ac68b418-4455-43d1-89f2-41fd3e93c5d2","block_type":"box","text":"and potentially other stakeholders, can be a useful mechanism for ensuring that senior management and the board","page_number":192,"box":{"x":69,"y":338,"width":822,"height":12}},{"id":"3dd19fe6-dc7d-43f0-9b40-1c313f445c76","block_type":"box","text":"are aware of potential misconduct or breaches in risk management and internal control processes.","page_number":192,"box":{"x":69,"y":353,"width":704,"height":12}},{"id":"ede1f060-50b0-4dd4-8dc0-b67576abb0a5","block_type":"box","text":"A comprehensive audit conducted by an independent audit firm contributes to investor confidence in the quality","page_number":192,"box":{"x":101,"y":372,"width":794,"height":11}},{"id":"68c507fe-52b5-4215-8505-f99c9f0f27a6","block_type":"box","text":"of corporate repor ting. It is helpful when the audit repor t gives some insight into the scope and focus of the audit, as","page_number":192,"box":{"x":69,"y":387,"width":836,"height":11}},{"id":"10946d15-1f99-4f40-a919-a4251e470251","block_type":"box","text":"well as any critical audit matters identified and how these were resolved. A comprehensive and effective audit is time","page_number":192,"box":{"x":68,"y":402,"width":838,"height":11}},{"id":"3c5a4548-2c55-4152-bbe1-7ab3f0026238","block_type":"box","text":"and resource intensive, and the audit fee should be commensurate. Fees paid to the audit firm for non-audit","page_number":192,"box":{"x":69,"y":416,"width":773,"height":11}},{"id":"caab4819-c8cb-4152-9408-da57795cc75c","block_type":"box","text":"consulting should not exceed the audit fee to a degree that may prompt concerns about the independence of the","page_number":192,"box":{"x":69,"y":431,"width":804,"height":12}},{"id":"7eb44fbb-3467-4e61-a91a-856b5cfd4cf6","block_type":"box","text":"audit. The audit committee should explain its position on auditor tenure and how it confirmed that the auditor","page_number":192,"box":{"x":69,"y":446,"width":780,"height":11}},{"id":"da4099cc-b9e7-43c1-a99f-168a9577c2db","block_type":"box","text":"remained independent.","page_number":192,"box":{"x":69,"y":461,"width":163,"height":11}},{"id":"f2e8febe-4ac1-4214-8272-53fdc55b10a1","block_type":"box","text":"We may vote against the election of the responsible directors if corporate repor ting is insufficient or there are","page_number":192,"box":{"x":101,"y":480,"width":783,"height":11}},{"id":"9673f359-34b0-47f2-9284-f0d2e3f533c8","block_type":"box","text":"material misstatements in financial repor ts. In markets where relevant, we may vote against a proposal to approve","page_number":192,"box":{"x":69,"y":495,"width":819,"height":11}},{"id":"b1cdb1d6-c2e4-4e02-84cc-c21e6e3aea33","block_type":"box","text":"the financial statements or the discharge of the board when we are concerned about the quality of corporate","page_number":192,"box":{"x":68,"y":509,"width":774,"height":12}},{"id":"e8276087-8d8a-4a0d-bcd8-c9ca9d385cde","block_type":"box","text":"repor ting or the audit. We may vote against proposals to appoint the auditor, ratify the audit repor t, or approve the","page_number":192,"box":{"x":69,"y":524,"width":816,"height":12}},{"id":"cf750a72-b86c-4c41-a90e-d1d25b7332ee","block_type":"box","text":"audit fee if we are concerned about the auditor’s independence, the quality of the audit, or there are material","page_number":192,"box":{"x":69,"y":539,"width":779,"height":11}},{"id":"7f24d5df-6fcf-46f3-a5a3-52584554dc42","block_type":"box","text":"misstatements in financial repor ts and the board has not established reasonable remediation plans.","page_number":192,"box":{"x":69,"y":554,"width":718,"height":11}},{"id":"91e1507d-f83c-41e0-ab2c-bba983dd3816","block_type":"box","text":"SHAREHOLDER RIGHTS AND PROTECTIONS","page_number":192,"box":{"x":329,"y":584,"width":319,"height":9}},{"id":"6c3b4e00-3e9f-4499-8c52-08040dccbaca","block_type":"box","text":"General shareholder meetings","page_number":192,"box":{"x":69,"y":607,"width":217,"height":11}},{"id":"b640d523-92bd-41f6-ae35-330413f34708","block_type":"box","text":"Companies normally have an annual general meeting of shareholders at which routine and non-routine items of","page_number":192,"box":{"x":102,"y":625,"width":792,"height":12}},{"id":"7741f8fc-d868-45af-b6cb-48423096a15d","block_type":"box","text":"business are discussed and voted on by shareholders in attendance or submitting proxy votes. Companies should","page_number":192,"box":{"x":69,"y":640,"width":812,"height":11}},{"id":"ac1b63ff-e72f-48cd-a1f6-c0496bf5000c","block_type":"box","text":"disclose materials relevant to the shareholder meeting sufficiently in advance so that shareholders can take them","page_number":192,"box":{"x":69,"y":655,"width":813,"height":11}},{"id":"e010b6e5-581a-4f57-b89a-3c32648b3b51","block_type":"box","text":"into consideration in their voting decisions. Many companies offer shareholders the option of par ticipating in the","page_number":192,"box":{"x":70,"y":670,"width":801,"height":11}},{"id":"2966bc41-1587-4871-a6f9-fdc57120c5f1","block_type":"box","text":"meeting vir tually which, whilst welcome, should not limit the rights of shareholders to par ticipate as they would during","page_number":192,"box":{"x":69,"y":685,"width":841,"height":11}},{"id":"96a96cf0-e067-4900-a90c-94bad20b2002","block_type":"box","text":"an in-person meeting.","page_number":192,"box":{"x":69,"y":700,"width":152,"height":11}},{"id":"53a8f97d-ba87-4ca0-a320-cad53019f414","block_type":"box","text":"We may vote against directors when materials related to the business of the shareholder meeting are not","page_number":192,"box":{"x":101,"y":718,"width":752,"height":12}},{"id":"d41b2761-38fe-435f-b3c8-7adc867f4a34","block_type":"box","text":"provided in a timely manner or do not provide sufficient information for us to make an informed voting decision. We","page_number":192,"box":{"x":70,"y":733,"width":821,"height":11}},{"id":"2f994a4a-4caf-43d0-b5a8-48c0b26bda26","block_type":"box","text":"may vote against directors if the format of the shareholder meeting does not accommodate reasonable shareholder","page_number":192,"box":{"x":69,"y":748,"width":825,"height":11}},{"id":"f2ab867b-f85c-484e-81e1-edb972e9f2bc","block_type":"box","text":"par ticipation.","page_number":192,"box":{"x":70,"y":763,"width":91,"height":11}},{"id":"cde50b0c-0854-44d3-bf26-444517c5cbf3","block_type":"box","text":"9","page_number":192,"box":{"x":69,"y":793,"width":4,"height":4}},{"id":"924b12d6-1ea5-4da4-9682-3c49fe7ed959","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Repor ting Standards","page_number":192,"box":{"x":93,"y":792,"width":744,"height":11}},{"id":"7a0a62d7-3867-4b29-a290-e66e2b1b624f","block_type":"box","text":"(IFRS) Foundation. Please refer to the IFRS website to learn more about the framework and standards S1","page_number":192,"box":{"x":94,"y":807,"width":748,"height":11}},{"id":"458be4ee-c035-47b2-ad43-cd43ee2e15ec","block_type":"box","text":"“General Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related","page_number":192,"box":{"x":94,"y":822,"width":778,"height":12}},{"id":"b4796eca-c31e-4562-9380-269e3ef8a5c3","block_type":"box","text":"Disclosures.”","page_number":192,"box":{"x":94,"y":838,"width":93,"height":8}},{"id":"53d746c3-4baf-4f5c-80c0-f68c11b8a03a","block_type":"box","text":"10","page_number":192,"box":{"x":69,"y":856,"width":9,"height":4}},{"id":"5bfab5a6-b2fd-4cc7-8526-e21dea9d9a71","block_type":"box","text":"See, for examples, https://www.ifrs.org/news-and-events/news/2025/06/ifrs-foundation-publishes-jurisdictional- profiles\r\nissbstandards/ and https//financeeceropae/capitalmarketsnionandfinancialmarkets/compan","page_number":192,"box":{"x":93,"y":858,"width":810,"height":11}},{"id":"6801d733-1ff1-4815-8a42-ffccdb659009","block_type":"box","text":"See, for examples, https://www.ifrs.org/newsandevents/news/2025/06/ifrsfoundationpublishesjurisdictional\r\nprofiles-issb-standards/ and https://finance.ec.europa.eu/capital-markets-union-and-financial-markets/companyrepor ting\r\nandaditing/companrepor ting/corporatesstainabilitrepor tingen","page_number":192,"box":{"x":94,"y":866,"width":804,"height":12}},{"id":"4c2cf671-954e-4ac1-b702-40c850fba50b","block_type":"box","text":"p/ p//p/p\r\nrepor ting-and-auditing/company-repor ting/corporate-sustainability-repor ting_en.","page_number":192,"box":{"x":94,"y":876,"width":564,"height":11}},{"id":"49f2ce37-6d88-47a5-a62a-9eda313ff0bf","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":192,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"9a76f009-04fd-4378-b8d1-12cb3b882607","block_type":"box","text":"Global Engagement and Voting Guidelines | 11","page_number":192,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"078096b0-5abb-4a5b-8d1c-4bc24a0db06e","block_type":"box","text":"NM1026U-5982568-192/232","page_number":192,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"ceff4d88-a020-4db7-a463-0eda1b1dd046","block_type":"box","text":"Bylaw amendments","page_number":193,"box":{"x":69,"y":45,"width":141,"height":11}},{"id":"9c6f9cc3-3ff9-48e2-9c44-c63665a46f93","block_type":"box","text":"We review bylaw amendments proposed by management on a case-by-case basis and will generally suppor t","page_number":193,"box":{"x":101,"y":64,"width":766,"height":11}},{"id":"99f6f953-892b-47bc-8d87-b7b023493074","block_type":"box","text":"those that are aligned with the interests of minority shareholders. Any material changes to the bylaws should be","page_number":193,"box":{"x":68,"y":78,"width":800,"height":11}},{"id":"3b8faa75-1c7c-40db-8ac9-76ad80d2eaef","block_type":"box","text":"explained in detail and put to a shareholder vote.","page_number":193,"box":{"x":69,"y":93,"width":349,"height":11}},{"id":"71730c1e-de3b-4bd2-b73a-4a5fc0d90620","block_type":"box","text":"We may vote against bylaw amendments that reduce shareholder rights and protections or introduce additional","page_number":193,"box":{"x":101,"y":112,"width":790,"height":11}},{"id":"1ad1ae9e-86bb-454a-a475-d26dfb3f7815","block_type":"box","text":"burdens. We may vote against directors if material changes are made to the bylaws without shareholder approval.","page_number":193,"box":{"x":69,"y":126,"width":810,"height":12}},{"id":"b0f72055-e7b9-4337-83ca-e8e18fb73941","block_type":"box","text":"If not provided for in the relevant corporate law, company bylaws should allow shareholders, individually or as a","page_number":193,"box":{"x":102,"y":145,"width":790,"height":11}},{"id":"35d93bfe-9008-4da2-bfca-84f3e5edf852","block_type":"box","text":"group, with a meaningful shareholding, the right to call a special meeting of shareholders. The shareholding required","page_number":193,"box":{"x":68,"y":160,"width":831,"height":11}},{"id":"1d78ea84-45ca-4dbd-aa35-9e88cd842b48","block_type":"box","text":"to exercise this right should balance its utility with the cost to the company of holding special meetings.","page_number":193,"box":{"x":68,"y":175,"width":740,"height":11}},{"id":"d52819e0-9f33-4638-bf2d-53879da93673","block_type":"box","text":"If not provided for in the relevant corporate law, company bylaws should allow shareholders, individually or as a","page_number":193,"box":{"x":102,"y":193,"width":790,"height":12}},{"id":"7e227aa6-f5c8-4416-b91b-1ef807b57b76","block_type":"box","text":"group, with a meaningful shareholding, the right to nominate directors to the company’s board. The threshold for this","page_number":193,"box":{"x":68,"y":208,"width":834,"height":12}},{"id":"e783574f-ffe1-4a2d-96f9-788272c559d0","block_type":"box","text":"right should be set so that shareholders can exercise it without being unduly disruptive to the board’s own","page_number":193,"box":{"x":69,"y":223,"width":758,"height":12}},{"id":"e4170769-1771-40dc-991e-8d1f32d32ccc","block_type":"box","text":"nomination process.","page_number":193,"box":{"x":69,"y":238,"width":143,"height":11}},{"id":"1103171f-081c-4e1f-b06f-1f49c6708965","block_type":"box","text":"Whilst we would not use either of these rights ourselves, we see them as impor tant accountability mechanisms.","page_number":193,"box":{"x":101,"y":257,"width":799,"height":11}},{"id":"10be7a9e-b5bc-4535-a259-a9e884eb06f9","block_type":"box","text":"We may vote for a shareholder proposal seeking the addition of either of these provisions to a company’s bylaws.","page_number":193,"box":{"x":68,"y":272,"width":810,"height":11}},{"id":"b02ec294-09a2-4850-9a5f-87904f05b48c","block_type":"box","text":"Change of domicile","page_number":193,"box":{"x":69,"y":294,"width":139,"height":11}},{"id":"e534a95a-034c-4f9b-8364-3c31fae95333","block_type":"box","text":"We generally defer to management on proposals to change a company’s domicile as long as the rationale for","page_number":193,"box":{"x":101,"y":313,"width":778,"height":11}},{"id":"7b3f4b4f-230c-46ed-aea6-72d83d629e39","block_type":"box","text":"doing so is consistent with the company’s long-term strategy and business model and the related costs are","page_number":193,"box":{"x":69,"y":328,"width":766,"height":11}},{"id":"b221c635-b322-4b84-a423-611da5481030","block_type":"box","text":"immaterial.","page_number":193,"box":{"x":70,"y":343,"width":77,"height":8}},{"id":"52bce81e-e1be-405c-a8f0-1f81524d953c","block_type":"box","text":"We may vote against directors or a proposal to change a company’s domicile where it does not seem aligned","page_number":193,"box":{"x":101,"y":361,"width":777,"height":11}},{"id":"42816a82-98ad-4117-993b-6352438b1c14","block_type":"box","text":"with our clients’ financial interests.","page_number":193,"box":{"x":68,"y":376,"width":249,"height":9}},{"id":"c13a4352-d00d-41b3-9979-f7d002fd949e","block_type":"box","text":"Changes to a company’s purpose or the nature of its business","page_number":193,"box":{"x":69,"y":398,"width":452,"height":11}},{"id":"094eb7d9-c1ca-44be-88c4-4573456819bf","block_type":"box","text":"Plans to materially change the nature of a company’s business or its purpose should be disclosed and explained","page_number":193,"box":{"x":102,"y":417,"width":803,"height":11}},{"id":"3ca62590-14d5-4b4f-b3ea-f6f4c2cd80fa","block_type":"box","text":"in the context of long-term strategy and business dynamics. Such changes may significantly alter an investor’s views","page_number":193,"box":{"x":70,"y":432,"width":829,"height":11}},{"id":"8a50921c-219e-42df-9932-2d53c63a2847","block_type":"box","text":"on the suitability of a company for their investment strategy or por tfolio.","page_number":193,"box":{"x":69,"y":447,"width":511,"height":11}},{"id":"13e74231-b093-4443-a137-a15eb90122ae","block_type":"box","text":"Where relevant, we may vote against proposals to change a company’s purpose or the nature of its business if","page_number":193,"box":{"x":101,"y":465,"width":792,"height":12}},{"id":"4f71b756-3b73-4c98-b543-d33bcb7d575c","block_type":"box","text":"the board has not provided a credible argument for change.","page_number":193,"box":{"x":68,"y":480,"width":424,"height":12}},{"id":"6afe4ba7-7d94-4711-a9c0-5b95490a764d","block_type":"box","text":"SHAREHOLDER PROPOSALS","page_number":193,"box":{"x":385,"y":510,"width":207,"height":9}},{"id":"8dbcdcfe-b747-4750-a9da-134e3edf053c","block_type":"box","text":"Shareholders in many markets, who meet cer tain eligibility criteria, have the right to submit proposals to the","page_number":193,"box":{"x":102,"y":529,"width":772,"height":11}},{"id":"537b6dd1-f207-4392-8df1-aa151f539c8c","block_type":"box","text":"general shareholder meeting asking a company to take a par ticular course of action subject to the proposal being","page_number":193,"box":{"x":68,"y":544,"width":811,"height":11}},{"id":"26fa9e82-b1db-4804-b479-080edfaa3169","block_type":"box","text":"suppor ted by a majority of votes cast at the meeting. The topics raised can address a range of matters that may be","page_number":193,"box":{"x":69,"y":559,"width":824,"height":11}},{"id":"e52db226-107d-4407-96fe-5bd2d985cf40","block_type":"box","text":"relevant to a company’s business.","page_number":193,"box":{"x":69,"y":574,"width":243,"height":11}},{"id":"dc1b0b75-433d-4d7e-9d51-3929faf48dbf","block_type":"box","text":"We vote on these proposals on a case-by-case basis. We assess the relevance of the topic raised to a","page_number":193,"box":{"x":101,"y":592,"width":730,"height":11}},{"id":"cc360888-9118-4b30-9210-97be78fa5e6e","block_type":"box","text":"company’s business and its current approach, whether the actions sought are consistent with shareholders’","page_number":193,"box":{"x":69,"y":607,"width":772,"height":11}},{"id":"7c48dce6-aa57-40eb-8e19-5e50c9bdece2","block_type":"box","text":"interests, and what impact the proposal being acted upon might have on financial per formance.","page_number":193,"box":{"x":70,"y":622,"width":681,"height":11}},{"id":"3bf43c80-52c0-46d3-96b4-48b712115191","block_type":"box","text":"Our general approach where we have concerns about a company’s governance, disclosures or per formance is to","page_number":193,"box":{"x":102,"y":641,"width":801,"height":11}},{"id":"35dd1030-18f3-4e01-9c0e-57994d8ed096","block_type":"box","text":"engage to understand the apparent difference in perspective. If we are concerned a company is not acting in","page_number":193,"box":{"x":69,"y":656,"width":774,"height":11}},{"id":"45262754-0b61-446b-8f14-6d6ffb03cb67","block_type":"box","text":"shareholders’ financial interests, we may vote against the election of directors. We may suppor t a relevant","page_number":193,"box":{"x":69,"y":670,"width":761,"height":12}},{"id":"74dd8d74-c2a2-485a-86c7-c5fa0a08bcb8","block_type":"box","text":"shareholder proposal if doing so is aligned with our clients’ financial interests. We generally do not suppor t","page_number":193,"box":{"x":69,"y":685,"width":764,"height":12}},{"id":"324bd4b2-504f-4752-92f5-900ef9d4c057","block_type":"box","text":"shareholder proposals that are legally binding on the company, seek to alter a company’s strategy or direct its","page_number":193,"box":{"x":69,"y":700,"width":785,"height":11}},{"id":"6e5ec4a2-1374-4853-905b-d2d0af817737","block_type":"box","text":"operations, or are unrelated to how a company manages risk or generates financial returns.","page_number":193,"box":{"x":69,"y":715,"width":653,"height":11}},{"id":"4aaee2a7-c9f6-4126-bb5e-eab3bb4e22d1","block_type":"box","text":"BlackRock is subject to rules, regulations, agency guidance and contractual agreements that place restrictions","page_number":193,"box":{"x":102,"y":734,"width":788,"height":11}},{"id":"88f6a147-1918-46d8-8426-56f6afd2e86c","block_type":"box","text":"and limitations on how we can interact with the companies in which we invest on behalf of our clients, including our","page_number":193,"box":{"x":69,"y":748,"width":822,"height":12}},{"id":"adbd5742-8544-4be7-8ebf-c4997f6d0266","block_type":"box","text":"ability to submit shareholder proposals. We do not submit shareholder proposals but can vote, on behalf of clients","page_number":193,"box":{"x":69,"y":763,"width":817,"height":12}},{"id":"91793312-3b3c-4dd1-826c-25d9fdec7834","block_type":"box","text":"who authorize us to do so, on proposals put for th by others.","page_number":193,"box":{"x":68,"y":778,"width":428,"height":11}},{"id":"780c45ed-167a-4514-9aa5-7d956edbd326","block_type":"box","text":"CORPORATE POLITICAL ACTIVITIES","page_number":193,"box":{"x":359,"y":808,"width":260,"height":9}},{"id":"9c121f24-38d4-404b-81a0-ebb882efa87a","block_type":"box","text":"A corporation’s ability to engage in the policy process is subject to rules and regulations set by the jurisdictions","page_number":193,"box":{"x":101,"y":827,"width":795,"height":11}},{"id":"7ab1f81a-398c-4005-9a71-23d9513415da","block_type":"box","text":"in which they engage. When a corporation repor ts material financial risk related to policy and or regulatory changes,","page_number":193,"box":{"x":70,"y":842,"width":824,"height":11}},{"id":"08624bb5-d5f2-403c-9a19-feef6edee0f6","block_type":"box","text":"BAIS may seek to understand how it is addressing the material risk identified. We seek to understand how","page_number":193,"box":{"x":70,"y":857,"width":757,"height":11}},{"id":"65e8a063-3de8-4c8d-974f-21425d51bf1a","block_type":"box","text":"companies engage in corporate political activities and ensure that their par ticipation is consistent with their public","page_number":193,"box":{"x":69,"y":872,"width":814,"height":11}},{"id":"5eee0440-84b9-4818-b527-d504a7e771cd","block_type":"box","text":"statements on policy matters material to the company’s long-term strategy. The board should be aware of the","page_number":193,"box":{"x":69,"y":887,"width":780,"height":11}},{"id":"60215265-8bb9-42c0-8345-380ccdebc6f2","block_type":"box","text":"approach taken by management on corporate political activities as there can be reputational risks arising from","page_number":193,"box":{"x":69,"y":901,"width":786,"height":12}},{"id":"108184d5-eb9e-460c-889f-1b2682b5416c","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":193,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"f212eb52-364d-4f29-bb52-2d8c58392c90","block_type":"box","text":"Global Engagement and Voting Guidelines | 12","page_number":193,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"8d6de844-b0fe-4d1a-8372-5b7aa1047c9e","block_type":"box","text":"NM1026U-5982568-193/232","page_number":193,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"4a8eb917-1898-45cd-b693-f0ffa7d8344f","block_type":"box","text":"inconsistencies between a company’s policy engagement and stated policy positions. Companies should, as a","page_number":194,"box":{"x":70,"y":45,"width":786,"height":11}},{"id":"6a521290-561b-42b4-b13c-12f2e571f0e1","block_type":"box","text":"minimum, meet all regulatory disclosure requirements on political activities. We may engage a company where we","page_number":194,"box":{"x":69,"y":60,"width":812,"height":11}},{"id":"dc51d535-86ff-4aeb-a485-c3542233cd82","block_type":"box","text":"would like to better understand its approach to policy engagement, where relevant.","page_number":194,"box":{"x":68,"y":75,"width":590,"height":11}},{"id":"51141e22-4356-4d83-9431-e7c14e28fdf1","block_type":"box","text":"To mitigate the risk of inconsistencies, companies may wish to assess the alignment between their policy","page_number":194,"box":{"x":101,"y":93,"width":753,"height":11}},{"id":"eb7748a5-9894-4dbe-91af-6e144c88184b","block_type":"box","text":"priorities and the policy positions of the trade associations of which they are active members and any engagements","page_number":194,"box":{"x":70,"y":108,"width":823,"height":11}},{"id":"b73d30f0-f166-4ce1-b37c-b65b3932a23c","block_type":"box","text":"under taken by trade associations on behalf of members.","page_number":194,"box":{"x":69,"y":123,"width":404,"height":11}},{"id":"d69c23cc-4652-4c1a-9136-0da25c4ffc29","block_type":"box","text":"We may suppor t a relevant shareholder proposal, or vote against directors, where a company’s disclosures are","page_number":194,"box":{"x":101,"y":142,"width":793,"height":11}},{"id":"34461033-d089-4ccf-89b3-fa12b47e835f","block_type":"box","text":"insufficient to address the material risk it has identified.","page_number":194,"box":{"x":70,"y":156,"width":400,"height":9}},{"id":"5072afa7-a919-422c-b11b-1dd7bbeabe4c","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":194,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"d0d01905-8571-48a5-9608-639f3ff354a4","block_type":"box","text":"Global Engagement and Voting Guidelines | 13","page_number":194,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"e44f2604-ca14-46b2-b234-99f1501d6b7a","block_type":"box","text":"NM1026U-5982568-194/232","page_number":194,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"2691fd24-eead-4bce-a578-d10237cbfe49","block_type":"box","text":"MATERIAL SUSTAINABILITY- RELATED RISKS AND OPPORTUNITIES","page_number":195,"box":{"x":245,"y":45,"width":489,"height":9}},{"id":"1a0e59bb-0a59-42c1-9b27-7e2b233b760d","block_type":"box","text":"We seek to understand how companies manage the material risks and oppor tunities inherent in their business","page_number":195,"box":{"x":101,"y":64,"width":790,"height":11}},{"id":"7bd2d432-f550-41a4-a4f3-9524187ab77d","block_type":"box","text":"operations. In our experience, sustainability-related factors","page_number":195,"box":{"x":69,"y":78,"width":418,"height":12}},{"id":"7a7d12bd-ca8a-4d63-be9f-b0d195675c87","block_type":"box","text":"11","page_number":195,"box":{"x":488,"y":79,"width":9,"height":4}},{"id":"9b23dfbc-f025-484c-ba61-e74094f22ee9","block_type":"box","text":"that are relevant to a company’s business or material to","page_number":195,"box":{"x":502,"y":79,"width":402,"height":11}},{"id":"51d96daf-43b0-481e-9063-61529c4e5119","block_type":"box","text":"its financial per formance, are generally operational considerations embedded into day-to-day management systems.","page_number":195,"box":{"x":70,"y":93,"width":824,"height":12}},{"id":"7198c50f-ba5f-4ee8-804c-68a0a7a274a0","block_type":"box","text":"Cer tain sustainability issues may also inform long-term strategic planning, for example, investing in product","page_number":195,"box":{"x":69,"y":108,"width":766,"height":11}},{"id":"b226cdf0-c3e7-4196-8bf9-359055731908","block_type":"box","text":"innovation in anticipation of changing consumer demand or adapting supply chains in response to changing","page_number":195,"box":{"x":70,"y":123,"width":764,"height":11}},{"id":"3314c2cf-4de4-44ef-b163-e913ce38f23e","block_type":"box","text":"regulatory requirements.","page_number":195,"box":{"x":69,"y":138,"width":174,"height":11}},{"id":"90933c72-4e3a-4aa9-9d6e-7a0824792d00","block_type":"box","text":"We recognize that the specific sustainability-related factors that may be financially material or business relevant","page_number":195,"box":{"x":101,"y":156,"width":798,"height":12}},{"id":"866da733-830d-4bc2-9cc7-934338b5b83f","block_type":"box","text":"will vary by company business model, sector, key markets, and time horizon, amongst other considerations. From","page_number":195,"box":{"x":68,"y":172,"width":809,"height":11}},{"id":"c9994722-4cf5-45da-ad3f-6bd4d5cc4276","block_type":"box","text":"company disclosures and our engagement, we aim to understand how management is identifying, assessing and","page_number":195,"box":{"x":69,"y":186,"width":803,"height":12}},{"id":"1360f972-1ceb-4bf8-858d-6d4362c695a7","block_type":"box","text":"integrating material sustainability-related risks and oppor tunities into their business decision-making and practices.","page_number":195,"box":{"x":70,"y":201,"width":820,"height":11}},{"id":"cdfbbabf-4ea3-44f3-95aa-34e7db0f329b","block_type":"box","text":"Doing so helps us under take a more holistic assessment of a company’s potential financial per formance and the","page_number":195,"box":{"x":70,"y":216,"width":808,"height":11}},{"id":"34d68059-a253-4491-9b59-2d109cc40c8f","block_type":"box","text":"likely risk-adjusted returns of an investment.","page_number":195,"box":{"x":70,"y":231,"width":313,"height":11}},{"id":"28cb8986-0213-4ac3-957e-312866523371","block_type":"box","text":"We may vote against directors or suppor t a relevant shareholder proposal if we have concerns about how a","page_number":195,"box":{"x":101,"y":249,"width":764,"height":12}},{"id":"0ac3ccab-465a-4c6f-be52-59f362fe7f18","block_type":"box","text":"company is managing or disclosing its approach to material sustainability-related risks that may impact financial","page_number":195,"box":{"x":69,"y":264,"width":798,"height":12}},{"id":"9056c1e8-1968-4d98-941a-ea560f59665d","block_type":"box","text":"returns.","page_number":195,"box":{"x":69,"y":280,"width":54,"height":8}},{"id":"1684b7b7-b221-40df-bbca-5ceb2611ba10","block_type":"box","text":"KEY STAKEHOLDERS","page_number":195,"box":{"x":414,"y":309,"width":151,"height":9}},{"id":"259c4d4a-2c19-49e6-bb25-bea87799caee","block_type":"box","text":"In our view, companies should understand and take into consideration the interests of the various par ties on","page_number":195,"box":{"x":102,"y":328,"width":774,"height":11}},{"id":"7a382af4-30eb-4549-9e7e-3b4570cce2f8","block_type":"box","text":"whom they depend for their success over time. It is for each company to determine their key stakeholders based on","page_number":195,"box":{"x":68,"y":343,"width":826,"height":11}},{"id":"698e14fd-dac5-4abc-9ca5-b3b675b9fae3","block_type":"box","text":"what is material to their business and long-term financial per formance. For many companies, key stakeholders","page_number":195,"box":{"x":68,"y":358,"width":790,"height":11}},{"id":"937a6400-475e-4ffc-ad78-cbf2dba8ab0a","block_type":"box","text":"include employees, business par tners (such as suppliers and distributors), clients and consumers, regulators, and","page_number":195,"box":{"x":70,"y":373,"width":817,"height":11}},{"id":"d755efc7-91b8-4e0c-a431-418b714dc76d","block_type":"box","text":"the communities in which they operate. Companies that appropriately balance the interests of investors and other","page_number":195,"box":{"x":68,"y":387,"width":813,"height":12}},{"id":"4ea8c6d9-3e7e-411d-b4ef-f7a849daf211","block_type":"box","text":"stakeholders are, in our experience, more likely to be financially resilient over time.","page_number":195,"box":{"x":69,"y":402,"width":592,"height":12}},{"id":"9ac8e1e9-f978-4292-9f97-deafa6812a6c","block_type":"box","text":"CLIMATE AND DECARBONIZATION INVESTMENT OBJECTIVES","page_number":195,"box":{"x":265,"y":432,"width":448,"height":9}},{"id":"1a08dbfc-658f-4a74-92d2-d545c31c90f6","block_type":"box","text":"Cer tain active BlackRock funds have climate and decarbonization objectives in addition to financial objectives.","page_number":195,"box":{"x":102,"y":451,"width":784,"height":11}},{"id":"61c0a016-d84d-4a1b-8216-8881567feeb8","block_type":"box","text":"Consistent with the objectives of those investment strategies, our stewardship activity in relation to the holdings in","page_number":195,"box":{"x":69,"y":466,"width":818,"height":11}},{"id":"56640994-f5cb-45fd-943e-b39eab14e13d","block_type":"box","text":"those funds differs in some respects from BAIS’ benchmark guidelines, which are described above. Specifically, for","page_number":195,"box":{"x":68,"y":481,"width":823,"height":11}},{"id":"2f5738d1-86eb-49f3-b868-7632f436c644","block_type":"box","text":"those funds’ holdings, we look to investee companies to demonstrate that they are aligned with a decarbonization","page_number":195,"box":{"x":68,"y":496,"width":814,"height":11}},{"id":"d0f339f4-f9bd-4b12-9443-ae46cab3ea6b","block_type":"box","text":"pathway that means their business model would be viable in a low-carbon economy,","page_number":195,"box":{"x":70,"y":511,"width":594,"height":11}},{"id":"3c163583-eaf4-45b0-a162-c54c10259df2","block_type":"box","text":"i.e.","page_number":195,"box":{"x":672,"y":511,"width":20,"height":9}},{"id":"73a0fe0c-a1c2-4c79-b9ca-2631c5a79b53","block_type":"box","text":", one in which global","page_number":195,"box":{"x":694,"y":511,"width":144,"height":11}},{"id":"170d37bd-371d-460a-b7a1-d86f4339a355","block_type":"box","text":"temperature rise is limited to 1.5°C above pre-industrial levels. In addition, clients in separately managed accounts","page_number":195,"box":{"x":68,"y":526,"width":821,"height":11}},{"id":"4faa8859-4363-4339-a7ae-b2095c9f3fc9","block_type":"box","text":"may instruct BlackRock to apply these guidelines to their holdings. Both in the case of funds and separately managed","page_number":195,"box":{"x":69,"y":540,"width":839,"height":12}},{"id":"e67cde0d-5cbf-4e5e-b7e0-80e80b4ed90e","block_type":"box","text":"accounts, these guidelines are only implemented upon explicit selection and approval by the applicable fund board or","page_number":195,"box":{"x":69,"y":555,"width":837,"height":12}},{"id":"cf9fbf3f-1628-4d41-82b0-be9eb175b539","block_type":"box","text":"client.","page_number":195,"box":{"x":69,"y":570,"width":41,"height":9}},{"id":"5bf52b5e-1186-460a-8a94-13a4d4ee83d2","block_type":"box","text":"These decarbonization stewardship guidelines focus on companies which produce goods and services that","page_number":195,"box":{"x":101,"y":589,"width":761,"height":11}},{"id":"5bc2e256-c785-46d9-8f07-70960222ce9c","block_type":"box","text":"contribute to real world decarbonization or have a carbon intensive business model and face outsized impacts from","page_number":195,"box":{"x":69,"y":604,"width":821,"height":11}},{"id":"00c047e6-747b-4c4d-a9dd-f7a318c36dcc","block_type":"box","text":"the low carbon transition, based on repor ted and estimated scopes 1, 2, and 3 greenhouse gas emissions. These","page_number":195,"box":{"x":68,"y":619,"width":817,"height":11}},{"id":"40d86d3e-d10c-4bef-b1c2-1c2d5d67c8b3","block_type":"box","text":"companies should provide disclosures that set out their governance, strategy, risk management processes and","page_number":195,"box":{"x":69,"y":634,"width":792,"height":11}},{"id":"04574510-6e05-4466-bdc6-412ec7eef47d","block_type":"box","text":"metrics and targets relevant to decarbonization. It is helpful to investors’ understanding when these disclosures","page_number":195,"box":{"x":69,"y":648,"width":799,"height":12}},{"id":"b17ea03d-39ee-466f-bb03-0c18274cca97","block_type":"box","text":"include an explanation of the decarbonization scenarios a company is using in its near- and long-term planning, as","page_number":195,"box":{"x":70,"y":663,"width":812,"height":11}},{"id":"44e1e0c6-9f4f-4bf9-bda2-53e56f531ce0","block_type":"box","text":"well as its scope 1, scope 2 and material scope 3 greenhouse gas (GHG) emissions and reduction targets for scope","page_number":195,"box":{"x":68,"y":678,"width":831,"height":11}},{"id":"5442aeeb-4431-411d-b201-21047f953472","block_type":"box","text":"1 and 2 emissions.","page_number":195,"box":{"x":70,"y":693,"width":135,"height":9}},{"id":"33f7c8f4-2123-4ec4-8dca-0b39eacb3ccb","block_type":"box","text":"Under these climate- and decarbonization-specific guidelines, BAIS may recommend a vote against directors or","page_number":195,"box":{"x":102,"y":711,"width":788,"height":12}},{"id":"f299a840-2e1e-49eb-b7cf-891b0bebb4c4","block_type":"box","text":"suppor t for a relevant shareholder proposal if a company does not appear to be adequately acting to address or","page_number":195,"box":{"x":69,"y":726,"width":800,"height":12}},{"id":"a8837cd6-d1b8-45ee-a015-236b9f292ba3","block_type":"box","text":"disclosing material climate-related risks, consistent with the parameters set out in these climate-and decarbonization","page_number":195,"box":{"x":69,"y":741,"width":839,"height":12}},{"id":"e84286a3-bdf4-490d-b8ef-82537faf2608","block_type":"box","text":"specific guidelines. We may recommend suppor ting shareholder proposals seeking information relevant to a","page_number":195,"box":{"x":69,"y":756,"width":771,"height":11}},{"id":"0dfb2582-5326-48e6-bf26-9a697dc4ee9c","block_type":"box","text":"11","page_number":195,"box":{"x":69,"y":786,"width":9,"height":4}},{"id":"7a8c2e7a-528f-4fb2-b23a-bc60f810484f","block_type":"box","text":"By material sustainability-related risks and oppor tunities, we mean the drivers of risk and financial value creation in","page_number":195,"box":{"x":84,"y":785,"width":822,"height":11}},{"id":"65ae19aa-deff-4095-a537-64bd90b414c8","block_type":"box","text":"a company’s business model that have an environmental or social dependency or impact. Examples of environmental","page_number":195,"box":{"x":69,"y":800,"width":835,"height":12}},{"id":"6fe545af-cf77-44fc-afcd-ab202e6f6674","block_type":"box","text":"issues include, but are not limited to, water use, land use, waste management, and climate risk. Examples of social","page_number":195,"box":{"x":70,"y":816,"width":827,"height":11}},{"id":"b09950d9-3c64-4f3f-a218-8c19d697a57b","block_type":"box","text":"issues include, but are not limited to, human capital management, impacts on the communities in which a company","page_number":195,"box":{"x":70,"y":831,"width":826,"height":11}},{"id":"5cafbe49-6880-48d9-a045-3606d993e273","block_type":"box","text":"operates, customer loyalty, and relationships with regulators. It is our view that well-managed companies will","page_number":195,"box":{"x":69,"y":846,"width":773,"height":11}},{"id":"2aa1bda3-3594-4db7-af93-f1a31a9f8c5b","block_type":"box","text":"effectively evaluate and manage material sustainability-related risks and oppor tunities relevant to their businesses.","page_number":195,"box":{"x":69,"y":861,"width":823,"height":11}},{"id":"3c8d98f4-a9e0-4d81-957e-91e358c00dd3","block_type":"box","text":"Governance is the core means by which boards can oversee the creation of durable financial value over time.","page_number":195,"box":{"x":69,"y":876,"width":777,"height":11}},{"id":"06a32a17-52b8-46d5-9409-ded02ed1a96e","block_type":"box","text":"Appropriate risk oversight of business-relevant and material sustainability-related considerations is a component of a","page_number":195,"box":{"x":68,"y":891,"width":833,"height":11}},{"id":"63dae512-ee09-48b2-8d84-b039ec4dcf97","block_type":"box","text":"sound governance framework.","page_number":195,"box":{"x":69,"y":906,"width":212,"height":12}},{"id":"f4345623-adab-4589-8f9b-e21d64713143","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":195,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"ed197470-94e1-4ab0-ac0b-a7b80d0424ab","block_type":"box","text":"Global Engagement and Voting Guidelines | 14","page_number":195,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"15b46781-f93d-4a18-8646-3e3e166c562f","block_type":"box","text":"NM1026U-5982568-195/232","page_number":195,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"0fe69096-4577-42e5-b5e8-18fad64e10df","block_type":"box","text":"company’s stated low-carbon transition strategy or targets that the company does not currently provide and that","page_number":196,"box":{"x":69,"y":45,"width":798,"height":11}},{"id":"5bdf82ed-d701-4ae5-b82c-c87597fc3b61","block_type":"box","text":"would be helpful to investment decision-making. We would not recommend suppor t for shareholder proposals that","page_number":196,"box":{"x":68,"y":59,"width":814,"height":12}},{"id":"0a9cb527-a969-4b07-b389-1e8ae5ca3cc7","block_type":"box","text":"seek to constrain board or management decision-making or direct specific business or strategic decisions. As under","page_number":196,"box":{"x":69,"y":74,"width":828,"height":12}},{"id":"9443f5f2-57eb-44af-99dd-c7e02c5a7981","block_type":"box","text":"the BAIS benchmark approach, the active por tfolio managers are ultimately responsible for voting consistent with","page_number":196,"box":{"x":68,"y":89,"width":807,"height":12}},{"id":"d898a5b7-76fb-4459-b894-d681890e12c8","block_type":"box","text":"their investment mandate and fund objectives. For the funds and accounts in scope, voting on matters not related to","page_number":196,"box":{"x":68,"y":104,"width":832,"height":11}},{"id":"92dcb63e-eed0-4f3e-9b90-e059f38586a4","block_type":"box","text":"climate risk and the energy transition is under taken in line with BAIS’ benchmark guidelines.","page_number":196,"box":{"x":69,"y":119,"width":658,"height":11}},{"id":"b4f61466-c180-47aa-8947-f78eb54d4256","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":196,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"413f6170-ef0f-465e-b514-3f2d9874cb0f","block_type":"box","text":"Global Engagement and Voting Guidelines | 15","page_number":196,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"1e38de39-7cdd-4711-8c44-676126c9ddfa","block_type":"box","text":"NM1026U-5982568-196/232","page_number":196,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"dbd6f4c7-d06e-4fae-bb1d-b95607ba75f2","block_type":"box","text":"APPENDIX 1: HOW WE FULFILL AND OVERSEE OUR INVESTMENT STEWARDSHIP RESPONSIBILITIES FOR NON","page_number":197,"box":{"x":83,"y":45,"width":812,"height":9}},{"id":"f2fc6168-f04b-4eea-b882-b265cd6a1971","block_type":"box","text":"INDEX EQUITY INVESTMENT STRATEGIES","page_number":197,"box":{"x":338,"y":60,"width":302,"height":10}},{"id":"8c375670-8412-4f56-acff-5d873496db63","block_type":"box","text":"Oversight","page_number":197,"box":{"x":69,"y":83,"width":68,"height":11}},{"id":"6ef52f5f-33bd-4a2c-8203-03d97b37bed3","block_type":"box","text":"The Global Head of BAIS has primary oversight of and responsibility for the team’s activities, including voting in","page_number":197,"box":{"x":101,"y":101,"width":793,"height":11}},{"id":"68d435f6-c903-4fcb-816b-030c6f2451de","block_type":"box","text":"accordance with the BlackRock Active Investment Stewardship Global Engagement and Voting Guidelines (the","page_number":197,"box":{"x":69,"y":116,"width":778,"height":11}},{"id":"14fedef9-4fbf-4c34-ac5e-7de897f22ffd","block_type":"box","text":"“Guidelines”), which require the application of professional judgment and consideration of each company’s unique","page_number":197,"box":{"x":70,"y":131,"width":814,"height":11}},{"id":"e6e266d7-4e89-4832-a4c2-e2a51ce9d442","block_type":"box","text":"circumstances, as well as input from active investors. BAIS is independent from BlackRock Investment Stewardship","page_number":197,"box":{"x":69,"y":146,"width":825,"height":11}},{"id":"d821a246-c461-486c-ace3-258f2edda6a7","block_type":"box","text":"in our engagement and voting activities, repor ting lines, and oversight.","page_number":197,"box":{"x":70,"y":161,"width":500,"height":11}},{"id":"509f7011-0762-4288-860c-16f0ec1b6553","block_type":"box","text":"The Stewardship Leaders Group, comprised of senior active investors and other relevant stakeholders in","page_number":197,"box":{"x":101,"y":179,"width":744,"height":11}},{"id":"74e91fbe-03a3-4091-bcce-80188a7de341","block_type":"box","text":"BlackRock’s legal, public policy, sustainability and communications teams, helps shape the firm’s approach to","page_number":197,"box":{"x":70,"y":194,"width":786,"height":11}},{"id":"d3b1e34c-3308-4c0e-ae67-53ffa565b1dd","block_type":"box","text":"investment stewardship on non-index equity investment strategies. The Group may advise on and review amendments","page_number":197,"box":{"x":70,"y":209,"width":839,"height":11}},{"id":"e2c76476-504f-4919-8d47-3e245ee1d05f","block_type":"box","text":"to BAIS’ policies and practices. It does not determine voting decisions, which are the responsibility of BAIS and the","page_number":197,"box":{"x":68,"y":224,"width":822,"height":11}},{"id":"2fb4e50e-6506-492a-9409-0211a926553e","block_type":"box","text":"relevant active equity investors.","page_number":197,"box":{"x":69,"y":239,"width":223,"height":11}},{"id":"3392690b-f977-48a2-85b0-b899a986d21d","block_type":"box","text":"BAIS carries out engagement with companies in collaboration with active investment colleagues, executes proxy","page_number":197,"box":{"x":102,"y":257,"width":797,"height":12}},{"id":"5d3af13f-4e2f-461a-bf3c-a09cfbb52c73","block_type":"box","text":"votes, and conducts vote operations (including maintaining records of votes cast) in a manner consistent with the","page_number":197,"box":{"x":68,"y":272,"width":810,"height":11}},{"id":"e61276a3-a708-4c12-ac01-a590f4424af8","block_type":"box","text":"Guidelines. BAIS also conducts research on corporate governance issues and par ticipates in industry discussions to","page_number":197,"box":{"x":69,"y":287,"width":832,"height":11}},{"id":"e5db9277-fc9c-4546-942a-82a786959a65","block_type":"box","text":"contribute to and keep abreast of impor tant developments in the corporate governance field. BAIS may use third","page_number":197,"box":{"x":69,"y":302,"width":801,"height":11}},{"id":"ccab2a87-565f-4acd-bc33-a71f852e5d64","block_type":"box","text":"par ties for cer tain of the foregoing activities and per forms oversight of those third par ties (see “Use and oversight of","page_number":197,"box":{"x":70,"y":317,"width":836,"height":11}},{"id":"e827d80f-b007-42ac-a557-411dee1a7acf","block_type":"box","text":"third-par ty vote services providers” below).","page_number":197,"box":{"x":68,"y":332,"width":305,"height":11}},{"id":"00bf8015-767d-493e-a237-0047a826f76b","block_type":"box","text":"Voting guidelines and vote execution","page_number":197,"box":{"x":68,"y":354,"width":269,"height":11}},{"id":"392a25b2-1564-4ea0-8a74-a0cd78353a72","block_type":"box","text":"BlackRock votes on proxy issues when our clients authorize us to do so. We carefully consider the voting items","page_number":197,"box":{"x":102,"y":373,"width":790,"height":11}},{"id":"e6f3ca1f-be38-4a37-9281-79bef91b7cb3","block_type":"box","text":"submitted to funds and other fiduciary account(s) (Fund or Funds) for which we have voting authority. BlackRock votes","page_number":197,"box":{"x":69,"y":387,"width":838,"height":12}},{"id":"c5ec414e-b3f0-4c5e-b56f-3242b9bb156d","block_type":"box","text":"(or refrains from voting) for each Fund for which we have voting authority based on our evaluation of the alignment of","page_number":197,"box":{"x":69,"y":402,"width":831,"height":12}},{"id":"8c15183e-e7cf-419b-a276-f23f61ed543f","block_type":"box","text":"the voting items with the long-term economic interests of our clients, in the exercise of our independent business","page_number":197,"box":{"x":68,"y":417,"width":809,"height":12}},{"id":"b74d9345-259d-4e95-a0b6-6baafd2ef70d","block_type":"box","text":"judgment, and without regard to the relationship of the issuer (or any shareholder proponent or dissident","page_number":197,"box":{"x":67,"y":432,"width":749,"height":11}},{"id":"9c8b69c0-27a4-4e5d-94ae-5ffb7c99113f","block_type":"box","text":"shareholder) to the Fund, the Fund’s affiliates (if any), BlackRock or BlackRock’s affiliates, or BlackRock employees","page_number":197,"box":{"x":69,"y":447,"width":825,"height":11}},{"id":"e07a919f-5ce0-4d96-815c-ed663027d592","block_type":"box","text":"(see “Conflicts management policies and procedures,” below).","page_number":197,"box":{"x":69,"y":462,"width":445,"height":11}},{"id":"621cf3a1-1108-4174-8617-b54975806949","block_type":"box","text":"When exercising voting rights, BAIS will normally vote on specific proxy issues in accordance with the Guidelines,","page_number":197,"box":{"x":101,"y":480,"width":803,"height":12}},{"id":"4191b492-c858-49c0-b2c2-ccb5f21cdadf","block_type":"box","text":"although por tfolio managers have the right to vote differently on their holdings if they determine doing so is more","page_number":197,"box":{"x":69,"y":495,"width":806,"height":12}},{"id":"4ef14065-dda6-476f-9578-08569dd7bfc3","block_type":"box","text":"aligned with the investment objective and financial interests of clients invested in the funds they manage.","page_number":197,"box":{"x":69,"y":510,"width":752,"height":11}},{"id":"1dae8fcb-005d-45e2-88ff-6c618bf03a41","block_type":"box","text":"The Guidelines are not intended to be exhaustive. BAIS applies the Guidelines on a case-by-case basis, in the","page_number":197,"box":{"x":101,"y":529,"width":782,"height":11}},{"id":"89558e24-4209-4761-b8ab-275b6834fef9","block_type":"box","text":"context of the individual circumstances of each company and the specific issue under review. As such, the Guidelines","page_number":197,"box":{"x":69,"y":544,"width":837,"height":11}},{"id":"9cc08424-a1d4-46ef-ab23-7d125f4106ee","block_type":"box","text":"do not indicate how BAIS will vote in every instance. Rather, they reflect our view about corporate governance issues","page_number":197,"box":{"x":69,"y":559,"width":830,"height":11}},{"id":"c7012842-ba35-4431-aa6f-ca7222c09048","block_type":"box","text":"generally, and provide insight into how we typically approach issues that are commonly put to a shareholder vote. The","page_number":197,"box":{"x":68,"y":574,"width":838,"height":11}},{"id":"33e2793e-2a7e-4d5b-8cec-462709812257","block_type":"box","text":"Guidelines are reviewed annually and updated as necessary to reflect changes in market practices, developments in","page_number":197,"box":{"x":69,"y":588,"width":829,"height":12}},{"id":"47c3cc9c-e518-42fd-8894-8abd0186cfad","block_type":"box","text":"corporate governance and feedback from companies and clients. In this way, BAIS aims to maintain policies that","page_number":197,"box":{"x":69,"y":603,"width":802,"height":11}},{"id":"b5019191-3772-4c90-b708-fdba75da660a","block_type":"box","text":"explain our approach to governance practices most aligned with clients’ long-term financial interests.","page_number":197,"box":{"x":69,"y":618,"width":718,"height":11}},{"id":"bf9a0399-621b-4dd9-bf4e-4a4cb892bda5","block_type":"box","text":"In cer tain markets, proxy voting involves logistical issues which can affect BAIS’ ability to vote such proxies, as","page_number":197,"box":{"x":102,"y":637,"width":792,"height":11}},{"id":"fe509829-75fa-43c6-bc5b-e3db998e5a06","block_type":"box","text":"well as the desirability of voting such proxies. These issues include, but are not limited to: i) untimely notice of","page_number":197,"box":{"x":68,"y":652,"width":791,"height":11}},{"id":"4a4f33b7-90a8-472e-82b6-542552480e20","block_type":"box","text":"shareholder meetings; ii) restrictions on a foreigner’s ability to exercise votes; iii) requirements to vote proxies in","page_number":197,"box":{"x":69,"y":666,"width":805,"height":12}},{"id":"147a23ca-100c-4533-976d-3cf438b1fa5b","block_type":"box","text":"person; iv) “share-blocking” (requirements that investors who exercise their voting rights surrender the right to","page_number":197,"box":{"x":70,"y":682,"width":784,"height":11}},{"id":"d15662cd-292d-454e-8c41-3978079493ea","block_type":"box","text":"dispose of their holdings from the point at which votes are submitted until after the shareholder meeting has","page_number":197,"box":{"x":69,"y":696,"width":775,"height":11}},{"id":"d934b945-5934-46d7-af07-ed6ad136e0ed","block_type":"box","text":"occurred); v) potential difficulties in translating the proxy; vi) regulatory constraints; and vii) requirements to provide","page_number":197,"box":{"x":69,"y":711,"width":824,"height":11}},{"id":"c9da2d75-a89d-44fe-a30c-f4c4f57ca8f0","block_type":"box","text":"local agents with powers of attorney to facilitate voting instructions. We are not suppor tive of impediments to the","page_number":197,"box":{"x":70,"y":726,"width":806,"height":11}},{"id":"263467bc-110d-41ca-bfd4-b73e763449b0","block_type":"box","text":"exercise of voting rights such as share-blocking or overly burdensome administrative requirements.","page_number":197,"box":{"x":69,"y":741,"width":704,"height":11}},{"id":"4545bff7-4a09-4986-a189-f24e04de1f8e","block_type":"box","text":"BlackRock votes proxies in these situations on a “best-effor ts” basis. In addition, BAIS may determine that it is","page_number":197,"box":{"x":102,"y":759,"width":796,"height":12}},{"id":"1b58629a-d7a8-4663-9dc3-47cc54041db1","block_type":"box","text":"generally in the interests of BlackRock’s clients not to vote proxies (or not to vote our full allocation) if the costs","page_number":197,"box":{"x":68,"y":774,"width":799,"height":12}},{"id":"fd6be516-cd78-4b5e-9eaf-f240914b6cbd","block_type":"box","text":"(including but not limited to oppor tunity costs associated with share-blocking constraints) associated with exercising","page_number":197,"box":{"x":69,"y":789,"width":829,"height":11}},{"id":"ac088fde-2796-46a9-9d7d-5cf19b066b5a","block_type":"box","text":"a vote are expected to outweigh the benefit the client would derive by voting on the proposal.","page_number":197,"box":{"x":69,"y":804,"width":661,"height":11}},{"id":"8c391b53-8ee3-42b2-acc6-732f331c0f6f","block_type":"box","text":"Voting Choice","page_number":197,"box":{"x":68,"y":826,"width":101,"height":12}},{"id":"c2d70c09-34c1-47e1-87e7-01ca4c005c2d","block_type":"box","text":"BlackRock offers Voting Choice, a program that provides eligible clients with more oppor tunities to par ticipate in","page_number":197,"box":{"x":102,"y":845,"width":800,"height":11}},{"id":"bfd5144e-2849-45c9-9c7e-2a9f3fc278ba","block_type":"box","text":"the proxy voting process where legally and operationally viable.","page_number":197,"box":{"x":68,"y":860,"width":447,"height":11}},{"id":"77b64841-3900-4045-ba18-e5601be7c68b","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":197,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"966d6443-1061-42e7-ad74-8eb98e4a2b9a","block_type":"box","text":"Global Engagement and Voting Guidelines | 16","page_number":197,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"060f0632-a4a7-4d9d-8d4b-b5b4bf3202cf","block_type":"box","text":"NM1026U-5982568-197/232","page_number":197,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"51e246f0-2bc1-4f1a-876e-3ea4a3c1cbd6","block_type":"box","text":"Voting Choice is currently available for eligible clients invested in cer tain institutional pooled funds in the U.S.,","page_number":198,"box":{"x":101,"y":45,"width":786,"height":11}},{"id":"f464d13d-3ee4-488b-91d7-11fe556ed65a","block_type":"box","text":"UK, and Canada that use systematic active equity (SAE) and multi-asset strategies. In addition, institutional clients in","page_number":198,"box":{"x":70,"y":60,"width":834,"height":11}},{"id":"3c432802-bf5b-4641-a6c4-cae4bde48880","block_type":"box","text":"separately managed accounts (SMAs) are eligible for BlackRock Voting Choice regardless of their investment","page_number":198,"box":{"x":69,"y":74,"width":774,"height":12}},{"id":"3ff501b8-9db5-486c-8665-6b96a94e149b","block_type":"box","text":"strategies.","page_number":198,"box":{"x":69,"y":89,"width":74,"height":12}},{"id":"6371a6b5-654d-409b-b2e4-8dc5868e474b","block_type":"box","text":"12","page_number":198,"box":{"x":145,"y":90,"width":9,"height":4}},{"id":"96bdfc2b-30ea-4971-b844-a4beb147db06","block_type":"box","text":"As a result, the shares attributed to BlackRock in company share registers may be voted differently depending","page_number":198,"box":{"x":101,"y":108,"width":788,"height":11}},{"id":"c7e7337f-ab98-44f9-8db1-a60b7ccb7e35","block_type":"box","text":"on whether our clients have authorized BAIS to vote on their behalf, have authorized BlackRock to vote in accordance","page_number":198,"box":{"x":69,"y":123,"width":834,"height":10}},{"id":"8a86f7b4-5a56-41d7-a279-99602d64d600","block_type":"box","text":"with a third-par ty policy, or have elected to vote shares in accordance with their own policy. 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Reliance upon this information is","page_number":200,"box":{"x":68,"y":822,"width":823,"height":11}},{"id":"46fe4ada-9fd0-494e-bd21-612cc67d4ae4","block_type":"box","text":"at the sole discretion of the reader.","page_number":200,"box":{"x":69,"y":837,"width":250,"height":9}},{"id":"e3b5271e-7cce-4b5d-b1a8-e6c2362ec125","block_type":"box","text":"Prepared by BlackRock, Inc.","page_number":200,"box":{"x":69,"y":868,"width":196,"height":10}},{"id":"665777e4-8d86-40c3-aa56-f91cda40e562","block_type":"box","text":"©","page_number":200,"box":{"x":68,"y":898,"width":6,"height":4}},{"id":"debe3447-b5bd-4218-96c3-9b197ee20809","block_type":"box","text":"2025 BlackRock, Inc. All rights reserved. BLACKROCK is a trademark of BlackRock, Inc., or its subsidiaries in the","page_number":200,"box":{"x":75,"y":898,"width":809,"height":11}},{"id":"dc813cd2-69d2-47b0-ac5d-742f1349a68b","block_type":"box","text":"United States and elsewhere. All other trademarks are those of their respective owners.","page_number":200,"box":{"x":70,"y":913,"width":624,"height":11}},{"id":"65f4a93e-a4f3-4980-aa79-4c1bfb9a70b1","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":200,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"101063f0-3b59-4063-91bd-71ef394ad1fc","block_type":"box","text":"Global Engagement and Voting Guidelines | 19","page_number":200,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"dddd2cb2-eb96-496f-94fc-ebc9c996b8e8","block_type":"box","text":"NM1026U-5982568-200/232","page_number":200,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"8baa2ae0-4347-4132-aeaa-aecf0e790ecf","block_type":"box","text":"Index Equity Fund Proxy Voting Policy","page_number":201,"box":{"x":352,"y":75,"width":275,"height":11}},{"id":"93720f5c-73f1-4a1c-aa7e-b2e49b4880f7","block_type":"box","text":"Procedures Governing Delegation of Proxy Voting to Fund Advisers","page_number":201,"box":{"x":247,"y":90,"width":486,"height":11}},{"id":"2ad350f3-7ba3-45cd-aadd-74ee245fc799","block_type":"box","text":"Effective Date: January 1, 2025","page_number":201,"box":{"x":376,"y":105,"width":227,"height":11}},{"id":"12b89927-0289-4aa8-a260-345285c451d6","block_type":"box","text":"Applies to the following types of Funds registered under the 1940 Act:","page_number":201,"box":{"x":231,"y":128,"width":515,"height":11}},{"id":"d8e71eb5-f72c-4b67-994f-53608ff65b22","block_type":"box","text":"Index Equity Mutual Funds and Exchange-Traded Funds","page_number":201,"box":{"x":306,"y":151,"width":388,"height":11}},{"id":"88cd437b-e834-4d68-9f9f-fbcd042d188e","block_type":"box","text":"□","page_number":201,"box":{"x":184,"y":173,"width":14,"height":11}},{"id":"eb8329f2-3ccb-40ea-bf60-e2510df42e30","block_type":"box","text":"Open-End Active and Fixed Income Index Mutual Funds and Exchange-Traded Funds","page_number":201,"box":{"x":205,"y":173,"width":589,"height":11}},{"id":"f2ecd68a-90f3-410b-89da-617f067dd4c7","block_type":"box","text":"□","page_number":201,"box":{"x":405,"y":196,"width":14,"height":11}},{"id":"7b4ec290-a674-4f03-bb29-5a0c2b76f1f9","block_type":"box","text":"Money Market Funds","page_number":201,"box":{"x":426,"y":196,"width":147,"height":11}},{"id":"39336ba2-2b1e-415f-a97c-814967977144","block_type":"box","text":"□","page_number":201,"box":{"x":416,"y":218,"width":14,"height":12}},{"id":"68235096-73d0-4048-a105-d885516fae77","block_type":"box","text":"Closed-End Funds","page_number":201,"box":{"x":437,"y":219,"width":125,"height":8}},{"id":"59c48e41-0a41-48b3-9381-d57510d52b2b","block_type":"box","text":"□","page_number":201,"box":{"x":460,"y":241,"width":14,"height":11}},{"id":"61f29d2b-a04e-48d2-8060-dd6e69aa0863","block_type":"box","text":"Other","page_number":201,"box":{"x":481,"y":241,"width":38,"height":9}},{"id":"971e688d-163e-45ac-817b-8edc54d789cc","block_type":"box","text":"Objective and Scope","page_number":201,"box":{"x":101,"y":260,"width":149,"height":11}},{"id":"33efd76a-5b13-4262-8dcc-cf021cea860e","block_type":"box","text":"Set for th below is the Index Equity Fund Proxy Voting Policy.","page_number":201,"box":{"x":134,"y":279,"width":421,"height":11}},{"id":"7855cb7b-d39c-4b67-a9c4-fe08efc18333","block_type":"box","text":"Policy/Document Requirements and Statements","page_number":201,"box":{"x":102,"y":297,"width":354,"height":11}},{"id":"18175388-753c-4764-b963-a238d9a83a04","block_type":"box","text":"The Boards of Trustees/Directors (“Directors”) of cer tain open-end funds (the “Funds”) advised by","page_number":201,"box":{"x":134,"y":316,"width":702,"height":11}},{"id":"56ce161a-a2e4-448d-a3f3-e0f956f44ad1","block_type":"box","text":"BlackRock Fund Advisors or BlackRock Advisors, LLC (“BlackRock”), have the responsibility for the oversight of","page_number":201,"box":{"x":102,"y":331,"width":789,"height":11}},{"id":"d9d0d92d-57c5-414c-a55e-3249e3629adc","block_type":"box","text":"voting proxies relating to por tfolio securities of the Funds, and have determined that it is in the best interests of","page_number":201,"box":{"x":101,"y":346,"width":801,"height":11}},{"id":"f3f0084c-d94f-413a-adba-434db3ee134a","block_type":"box","text":"the Funds and their shareholders to delegate the responsibility to vote proxies to BlackRock, subject to the","page_number":201,"box":{"x":101,"y":361,"width":763,"height":11}},{"id":"1277586f-d8fb-4db9-bb10-0e5dc8df8df3","block_type":"box","text":"principles outlined in this Policy, as par t of BlackRock’s authority to manage, acquire and dispose of account","page_number":201,"box":{"x":102,"y":375,"width":775,"height":12}},{"id":"8bf318e0-7994-4a1c-9cc6-2d6ff045368a","block_type":"box","text":"assets, all as contemplated by the Funds’ respective investment management agreements.","page_number":201,"box":{"x":102,"y":391,"width":651,"height":11}},{"id":"d4fbb84d-f3d9-4d58-9367-196da60372a3","block_type":"box","text":"BlackRock has adopted the BlackRock Investment Stewardship Global Benchmark Policy (as from time to","page_number":201,"box":{"x":135,"y":409,"width":748,"height":11}},{"id":"058eaab9-eeb1-477b-ac0a-b3f0e2032adc","block_type":"box","text":"time amended, the “Guidelines”) governing proxy voting by index equity Funds managed by BlackRock, except for","page_number":201,"box":{"x":101,"y":424,"width":804,"height":11}},{"id":"dae5836e-b027-4527-8f7e-f11b8526095e","block_type":"box","text":"the iShares Core S&P 500 ETF. In addition, BlackRock has adopted guidelines and procedures (as from time to","page_number":201,"box":{"x":101,"y":439,"width":793,"height":11}},{"id":"b7870ec9-4e1a-4e97-ae49-906b2f9561b9","block_type":"box","text":"time amended, the “BlackRock Climate and Decarbonization Stewardship Guidelines”) governing proxy voting for","page_number":201,"box":{"x":101,"y":454,"width":801,"height":11}},{"id":"a675c61b-a3fc-4f28-850c-489ff43e15ed","block_type":"box","text":"matters covered in the BlackRock Climate and Decarbonization Stewardship Guidelines by the Funds listed in","page_number":201,"box":{"x":102,"y":469,"width":777,"height":11}},{"id":"7f41acae-7cac-41b8-8047-d23460ad66a2","block_type":"box","text":"Appendix A.","page_number":201,"box":{"x":101,"y":484,"width":82,"height":10}},{"id":"122ca128-ea9d-49d3-aedb-19edb42be44c","block_type":"box","text":"BlackRock will cast votes on behalf of each of the Funds covered by this policy on specific proxy issues in","page_number":201,"box":{"x":135,"y":502,"width":751,"height":11}},{"id":"5ca9f00b-1a2c-4895-943a-fa998b502fc9","block_type":"box","text":"respect of securities held by each such Fund (or may refrain from voting) in accordance with the Guidelines and","page_number":201,"box":{"x":102,"y":517,"width":791,"height":11}},{"id":"a67f78ec-228c-462c-9d88-0b1dd188db13","block_type":"box","text":"the BlackRock Climate and Decarbonization Stewardship Guidelines, as applicable.","page_number":201,"box":{"x":101,"y":532,"width":591,"height":11}},{"id":"bf22f3c7-b1b9-4488-880b-1f839f8ce3fc","block_type":"box","text":"Conflicts Management","page_number":201,"box":{"x":101,"y":550,"width":165,"height":11}},{"id":"9b358fb0-68b6-405b-aa0d-2141ead23e3b","block_type":"box","text":"BlackRock Investment Stewardship (“BIS”) maintains policies and procedures that seek to prevent undue","page_number":201,"box":{"x":135,"y":569,"width":751,"height":11}},{"id":"184120e0-a28e-4a88-974a-2f56244a831c","block_type":"box","text":"influence on BlackRock’s proxy voting activity and to mitigate material conflicts of interest in the exercise of","page_number":201,"box":{"x":102,"y":584,"width":767,"height":11}},{"id":"6729a0c4-3932-481b-80f0-08c8e2b5619a","block_type":"box","text":"proxy voting responsibilities. Potential material conflicts, and the resultant potential for undue influence, might","page_number":201,"box":{"x":102,"y":599,"width":787,"height":11}},{"id":"0171760c-f5ea-4234-b771-8c681dfb9b98","block_type":"box","text":"be due to a relationship between the investee company (or any shareholder proponent or dissident shareholder)","page_number":201,"box":{"x":102,"y":614,"width":797,"height":11}},{"id":"41845ab7-18da-42b2-bbd1-806cc066fb27","block_type":"box","text":"and BlackRock, BlackRock’s affiliates or employees, or a Fund or a Fund’s affiliates. BlackRock has taken","page_number":201,"box":{"x":102,"y":628,"width":756,"height":12}},{"id":"cdcce6c9-1ab8-4788-9bb8-55385acc9d6b","block_type":"box","text":"cer tain steps to mitigate potential conflicts, which are outlined in detail in the Guidelines. In mitigating conflicts,","page_number":201,"box":{"x":101,"y":643,"width":800,"height":12}},{"id":"3ec77b08-831d-47ab-9403-44715fe2ded8","block_type":"box","text":"BIS will adhere to the Guidelines.","page_number":201,"box":{"x":102,"y":658,"width":235,"height":9}},{"id":"d09006c9-37d3-4ee8-acce-465a5168bc19","block_type":"box","text":"In cer tain instances, BIS will engage an independent third-par ty voting service provider to make proxy voting","page_number":201,"box":{"x":135,"y":677,"width":769,"height":11}},{"id":"e29f72ae-3822-47ce-ab8c-ac690026baf3","block_type":"box","text":"recommendations as a fur ther safeguard to avoid potential conflicts of interest, to satisfy regulatory compliance","page_number":201,"box":{"x":102,"y":692,"width":800,"height":11}},{"id":"93f87e5b-8f63-4ccf-b49a-e687ced8e095","block_type":"box","text":"requirements, or as may be otherwise required by applicable law.","page_number":201,"box":{"x":102,"y":707,"width":463,"height":11}},{"id":"f4286707-ea67-4804-b19c-f87e1caa4960","block_type":"box","text":"With respect to the relationship between securities lending and proxy voting, shares on loan cannot be voted","page_number":201,"box":{"x":134,"y":725,"width":774,"height":11}},{"id":"85eaec4f-3e19-4bd5-b99f-3060679728f9","block_type":"box","text":"and BlackRock may determine to recall them for voting, as guided by BlackRock’s fiduciary responsibility to act","page_number":201,"box":{"x":102,"y":740,"width":791,"height":11}},{"id":"e42d2e6c-488b-400d-9500-0efa079102c0","block_type":"box","text":"in clients’ financial interests. The Guidelines set for th BlackRock’s approach to recalling securities on loan in","page_number":201,"box":{"x":102,"y":755,"width":778,"height":11}},{"id":"7722f640-b7f4-4a74-8808-76550eb83a4d","block_type":"box","text":"connection with proxy voting.","page_number":201,"box":{"x":101,"y":770,"width":203,"height":11}},{"id":"7164c43b-884d-489f-9f07-a50eb06fb210","block_type":"box","text":"Reports to the Board","page_number":201,"box":{"x":102,"y":789,"width":153,"height":10}},{"id":"cc978859-92f5-4c03-b817-d0cf23babf18","block_type":"box","text":"BlackRock will repor t on an annual basis to the Directors on (1) a summary of the proxy voting process as","page_number":201,"box":{"x":135,"y":807,"width":755,"height":11}},{"id":"2e8a9e7b-5a3e-4ea1-83e0-46e4dca8367c","block_type":"box","text":"applicable to the Funds covered by this policy in the preceding year together with a representation that all 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These are topics that shareholders may have","page_number":206,"box":{"x":69,"y":475,"width":822,"height":12}},{"id":"dbb30987-7e59-4ab8-afe9-ed3d97731363","block_type":"box","text":"the ability to vote on at shareholder meetings. 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Our regional voting guidelines explain how the BIS Global","page_number":206,"box":{"x":69,"y":717,"width":781,"height":12}},{"id":"2186c5c8-8ea0-4909-ad1f-8819ad0e6390","block_type":"box","text":"Principles inform our voting decisions in relation to common ballot items for shareholder meetings in those markets.","page_number":206,"box":{"x":69,"y":732,"width":829,"height":12}},{"id":"f63c104b-c98d-4467-adaa-982ea68c982c","block_type":"box","text":"4","page_number":206,"box":{"x":899,"y":733,"width":5,"height":4}},{"id":"1e7ee59a-45e5-4382-856d-963eb0c8c490","block_type":"box","text":"3","page_number":206,"box":{"x":69,"y":762,"width":4,"height":5}},{"id":"2b0aecf7-327c-413d-8ca3-7a7e33d341ad","block_type":"box","text":"Examples include: Government of Canada, “Canada Business Corporations Act,” amended 2024; European Union,","page_number":206,"box":{"x":79,"y":762,"width":816,"height":11}},{"id":"4bf29e6d-61ba-4b07-80de-9939dc88614f","block_type":"box","text":"“Shareholder Rights Directive II,” 2017; and the China Securities Regulatory Commission, “Code of Corporate","page_number":206,"box":{"x":70,"y":777,"width":784,"height":11}},{"id":"d8b1b317-1bb7-4ccf-a31a-d1b4d4e4bff2","block_type":"box","text":"Governance for Listed Companies in China,” 2001. Websites accessed in December 2025.","page_number":206,"box":{"x":69,"y":792,"width":650,"height":11}},{"id":"1f5c4264-8127-488d-b1e1-6733f6f3ac4a","block_type":"box","text":"4","page_number":206,"box":{"x":69,"y":810,"width":4,"height":4}},{"id":"1881ea0c-ee32-4c2a-a736-33b948f36bdb","block_type":"box","text":"Our regional voting guidelines reflect these different market standards and norms. Depending on the market,","page_number":206,"box":{"x":79,"y":810,"width":776,"height":11}},{"id":"cc5c9027-3c1a-4b4b-91cc-76a0958987f1","block_type":"box","text":"generally accepted practice is informed by corporate law, market regulation, best practices, and industry initiatives,","page_number":206,"box":{"x":68,"y":825,"width":821,"height":11}},{"id":"bf1f3af7-7ee6-4e65-b581-ccaf3b366e55","block_type":"box","text":"amongst other factors. BIS carries out engagement with companies, executes proxy votes, and conducts vote","page_number":206,"box":{"x":69,"y":840,"width":780,"height":11}},{"id":"684c5344-407b-429f-ab09-51573b8f26ea","block_type":"box","text":"operations (including maintaining records of votes cast) in a manner consistent with the relevant regional voting","page_number":206,"box":{"x":69,"y":855,"width":796,"height":11}},{"id":"7e2cefcc-5662-4810-98bd-d2e1996c93de","block_type":"box","text":"guidelines.","page_number":206,"box":{"x":68,"y":870,"width":76,"height":11}},{"id":"4987161a-adf6-412c-ab99-00610c5a80b5","block_type":"box","text":"BlackRock Investment Stewardship","page_number":206,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"c9ebf4d2-cde7-467b-8b75-7ad2af30e440","block_type":"box","text":"Global Principles | 4","page_number":206,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"1233a747-9135-4018-b666-390c06c190cc","block_type":"box","text":"NM1026U-5982568-206/232","page_number":206,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"a944b833-8c85-4931-9ab0-2afcc06a27e7","block_type":"box","text":"BOARDS AND DIRECTORS","page_number":207,"box":{"x":394,"y":45,"width":190,"height":9}},{"id":"73f226e2-f810-4c38-ac87-d8d1cc4f4dae","block_type":"box","text":"Oversight role of the board","page_number":207,"box":{"x":69,"y":75,"width":194,"height":11}},{"id":"3380c28d-6928-4b47-a391-f5fbfe4f755b","block_type":"box","text":"Companies whose boards are comprised of appropriately qualified, engaged directors with professional","page_number":207,"box":{"x":102,"y":98,"width":734,"height":11}},{"id":"cab86fc4-90f4-4f94-a036-35cf6f23d0eb","block_type":"box","text":"characteristics relevant to a company’s business enhance the board’s ability to add long-term financial value and","page_number":207,"box":{"x":69,"y":113,"width":806,"height":11}},{"id":"52540956-8368-4f3e-97b8-53e4f86dcca0","block_type":"box","text":"serve as the voice of shareholders in board discussions. In our view, a strong board gives a company a competitive","page_number":207,"box":{"x":69,"y":128,"width":822,"height":11}},{"id":"38cc5df4-0b6c-4d6a-80cd-be53ba892c0f","block_type":"box","text":"advantage, providing valuable oversight and contributing to the most impor tant management decisions that suppor t","page_number":207,"box":{"x":69,"y":143,"width":825,"height":11}},{"id":"087315e5-8a31-4929-ba85-faafdf86abeb","block_type":"box","text":"long-term financial per formance.","page_number":207,"box":{"x":70,"y":158,"width":229,"height":11}},{"id":"f0a88c25-88f6-4dd6-8abd-07801cdbc911","block_type":"box","text":"For this reason, our investment stewardship effor ts focus on the effectiveness of the board of directors. We","page_number":207,"box":{"x":102,"y":181,"width":771,"height":11}},{"id":"757bdc92-9c42-4f05-a4fa-89fed1f82136","block_type":"box","text":"engage, as necessary, with members of the board’s nominating and/or governance committee to assess whether","page_number":207,"box":{"x":69,"y":196,"width":811,"height":11}},{"id":"05573f57-9962-4f2a-8f6d-a004736d6e03","block_type":"box","text":"governance practices and board composition are effective given a company’s business model, sector, market, and","page_number":207,"box":{"x":68,"y":211,"width":817,"height":11}},{"id":"b828d120-1c7a-40a5-808c-e80395d4fcb2","block_type":"box","text":"the business environment in which a company is operating.","page_number":207,"box":{"x":68,"y":226,"width":422,"height":11}},{"id":"eb97b9c5-dc6f-480a-9cf1-65a2be24252b","block_type":"box","text":"We consider it good practice when the board establishes and maintains a framework of robust and effective","page_number":207,"box":{"x":101,"y":249,"width":770,"height":11}},{"id":"3a194e20-f00f-4695-9a04-b708f6a888c3","block_type":"box","text":"governance mechanisms that suppor ts its oversight of the company’s strategy and operations, consistent with the","page_number":207,"box":{"x":68,"y":264,"width":817,"height":11}},{"id":"2971cdf7-084a-4431-ae8c-b8e1db9e4ccb","block_type":"box","text":"long-term financial interests of investors. This includes having clear descriptions of the role of the board and the","page_number":207,"box":{"x":70,"y":279,"width":799,"height":11}},{"id":"095b5c0e-5fd0-4fcf-9dfe-bd12fa7031ab","block_type":"box","text":"committees of the board and how directors engage with and oversee management, as well as disclosure of material","page_number":207,"box":{"x":69,"y":294,"width":827,"height":11}},{"id":"36a7c840-c4dd-4524-b732-4d7a4e4bcb70","block_type":"box","text":"risks that may affect a company’s long-term strategy and how management is effectively identifying, managing, and","page_number":207,"box":{"x":69,"y":309,"width":822,"height":11}},{"id":"3f4351b8-27c5-449f-9cb2-fbf428b6054b","block_type":"box","text":"mitigating such risks.","page_number":207,"box":{"x":69,"y":325,"width":150,"height":11}},{"id":"59c49123-b930-4c23-ac84-39e5a65ddde7","block_type":"box","text":"Understanding management’s long-term strategy and the milestones against which investors should assess its","page_number":207,"box":{"x":102,"y":347,"width":791,"height":11}},{"id":"6fb646a7-a009-4bc5-a654-f71104c88abf","block_type":"box","text":"implementation is central to our approach. If any strategic targets are significantly missed or materially restated, we","page_number":207,"box":{"x":70,"y":362,"width":826,"height":11}},{"id":"8bca51ed-7149-4576-af05-1e0b42fdaeb3","block_type":"box","text":"find it helpful when company disclosures provide a detailed explanation of the changes and an indication of the","page_number":207,"box":{"x":68,"y":377,"width":793,"height":12}},{"id":"bd3feaf5-d116-47c2-ab15-a820f33a6e8c","block_type":"box","text":"board’s role in reviewing the revised targets. We look to the board to ar ticulate the effectiveness of these","page_number":207,"box":{"x":69,"y":392,"width":755,"height":12}},{"id":"92cc663a-013f-4aed-abd5-aeefce746bb8","block_type":"box","text":"mechanisms in overseeing the management of business risks and oppor tunities and the fulfillment of the company’s","page_number":207,"box":{"x":69,"y":407,"width":835,"height":12}},{"id":"9c7d2731-0e1f-4d17-b71e-6813f2437b8f","block_type":"box","text":"strategy.","page_number":207,"box":{"x":69,"y":423,"width":58,"height":11}},{"id":"a94286df-cb52-444a-b5a7-378e3de7ea4b","block_type":"box","text":"Where a company has not adequately disclosed or demonstrated that its board has fulfilled these corporate","page_number":207,"box":{"x":101,"y":445,"width":769,"height":11}},{"id":"aa632184-ea3b-4b27-a81c-ed864d4c1ab3","block_type":"box","text":"governance and risk oversight responsibilities, we may consider not suppor ting the election of directors who, in our","page_number":207,"box":{"x":68,"y":460,"width":823,"height":12}},{"id":"2d78f63e-a0ba-42d5-b1cd-4be83605a28f","block_type":"box","text":"assessment, have par ticular responsibility for the issues.","page_number":207,"box":{"x":69,"y":475,"width":409,"height":12}},{"id":"987d1518-0ce5-435c-80c8-335634030ac3","block_type":"box","text":"When casting vote decisions on behalf of clients on the election of directors, some of the factors that speak to","page_number":207,"box":{"x":101,"y":498,"width":791,"height":11}},{"id":"1d98c108-0d89-4b39-a1d3-8dd3f4ae1456","block_type":"box","text":"the board’s effectiveness as a group include the relevance of individual directors’ qualifications and skillsets, as well","page_number":207,"box":{"x":68,"y":513,"width":836,"height":12}},{"id":"8995d1cd-e9e4-4f73-b567-18f02a8ff86b","block_type":"box","text":"as directors’ capacity and other time commitments, and how these factors may contribute to the company’s financial","page_number":207,"box":{"x":69,"y":528,"width":833,"height":12}},{"id":"214019fd-2e33-436a-a834-31b35167e84c","block_type":"box","text":"per formance. We look to boards to establish formal and transparent processes for nominating directors that reflect","page_number":207,"box":{"x":70,"y":543,"width":823,"height":12}},{"id":"28825cbf-826b-4173-9957-5abae637694e","block_type":"box","text":"the company’s long-term strategy and business model.","page_number":207,"box":{"x":68,"y":559,"width":390,"height":11}},{"id":"446322a6-eb19-4a4c-af62-2f3fa683c124","block_type":"box","text":"In the section titled “Board quality and effectiveness” below, we provide more detail about our approach to board","page_number":207,"box":{"x":102,"y":581,"width":807,"height":11}},{"id":"23f80850-ab73-4f42-bd69-7875ddb71d0c","block_type":"box","text":"composition and how it underpins board effectiveness and long-term financial value creation.","page_number":207,"box":{"x":69,"y":596,"width":662,"height":12}},{"id":"62e3aced-3c15-4a48-b648-e25ce42de28f","block_type":"box","text":"Regular accountability through director elections","page_number":207,"box":{"x":69,"y":627,"width":358,"height":11}},{"id":"3a7ee938-c194-4f3f-852a-da53e7578f50","block_type":"box","text":"The election of directors to the board is a right of shareholders and an impor tant signal of suppor t for, or","page_number":207,"box":{"x":101,"y":649,"width":750,"height":12}},{"id":"d786dd05-5fd2-405e-bd18-0559dc81d82f","block_type":"box","text":"concern about, the per formance of the board in overseeing and advising management. To ensure accountability for","page_number":207,"box":{"x":69,"y":664,"width":819,"height":12}},{"id":"4f90716a-bced-4149-b2a3-4ffd2c986d94","block_type":"box","text":"their decisions on behalf of shareholders, directors should stand for election on a regular basis, ideally annually.","page_number":207,"box":{"x":68,"y":680,"width":802,"height":11}},{"id":"5749ace3-e209-4c05-8480-8c55433be3f3","block_type":"box","text":"5","page_number":207,"box":{"x":872,"y":680,"width":4,"height":4}},{"id":"91dec2e7-da0f-4fe8-877c-75373c8ebe3f","block_type":"box","text":"Annual director elections allow shareholders to reaffirm their suppor t for, or concerns about, board members’","page_number":207,"box":{"x":68,"y":695,"width":782,"height":11}},{"id":"36d9178c-b4d8-4006-8e6c-db0ad9d14b24","block_type":"box","text":"decisions in a timely manner. When board members are not elected annually, we consider it good practice for boards","page_number":207,"box":{"x":69,"y":710,"width":832,"height":11}},{"id":"fd0829c3-074b-4886-bbc9-5c135940ebbc","block_type":"box","text":"to have a rotation policy to ensure that, through a board cycle, all directors have had their appointment re-confirmed,","page_number":207,"box":{"x":68,"y":725,"width":832,"height":11}},{"id":"529746c9-4cb7-4aed-bc3c-84e8dcf7dca5","block_type":"box","text":"with a propor tion of directors being put forward for election at each shareholder meeting.","page_number":207,"box":{"x":68,"y":740,"width":636,"height":11}},{"id":"e5841f13-1d90-46c3-b2ff-f7fdcbecd20b","block_type":"box","text":"BOARD QUALITY AND EFFECTIVENESS","page_number":207,"box":{"x":348,"y":770,"width":282,"height":11}},{"id":"a124c0ec-d167-4443-a57b-5715c8b9792e","block_type":"box","text":"Regular director elections also give boards the oppor tunity to adjust their composition in an orderly way to reflect","page_number":207,"box":{"x":102,"y":793,"width":805,"height":11}},{"id":"24247bf4-0600-47e3-8ef1-7baf2fdcdce4","block_type":"box","text":"developments in the company’s strategy and the market environment. In our view, it is beneficial for new directors to","page_number":207,"box":{"x":69,"y":808,"width":831,"height":11}},{"id":"65d7ebba-a804-476b-9de6-5713ce470d52","block_type":"box","text":"be brought onto the board periodically to refresh the group’s thinking, while suppor ting both continuity and","page_number":207,"box":{"x":69,"y":823,"width":758,"height":12}},{"id":"90b8f12b-8c59-4e83-bdc5-1d330fc44b38","block_type":"box","text":"5","page_number":207,"box":{"x":69,"y":853,"width":4,"height":4}},{"id":"32577e20-deb2-4e63-8ea0-a0d0f9f6bb2f","block_type":"box","text":"In most markets, directors stand for re-election on an annual or triennial basis, as determined by corporate law,","page_number":207,"box":{"x":79,"y":852,"width":795,"height":12}},{"id":"3c7a837e-da46-48ea-8caf-db6cd740ed8a","block_type":"box","text":"market regulation or voluntary best practice.","page_number":207,"box":{"x":69,"y":868,"width":314,"height":11}},{"id":"a8697c62-7118-4a53-a4b5-61f6ae62c109","block_type":"box","text":"BlackRock Investment Stewardship","page_number":207,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"9a8342e3-cf7f-4747-b323-b9f872488d87","block_type":"box","text":"Global Principles | 5","page_number":207,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"1735284e-2f65-4400-aa23-fa8c2f8b4543","block_type":"box","text":"NM1026U-5982568-207/232","page_number":207,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"1f2b891e-9fc5-4bfa-9ad3-67faabd5e5a5","block_type":"box","text":"appropriate succession planning. We consider the average overall tenure of the board and seek a balance between","page_number":208,"box":{"x":69,"y":45,"width":819,"height":11}},{"id":"5a323434-8be2-4524-a170-0667d6213553","block_type":"box","text":"the knowledge and experience of longer-serving directors and the fresh perspectives of directors who joined more","page_number":208,"box":{"x":68,"y":60,"width":809,"height":11}},{"id":"20e9a4cf-1e30-4608-b8c7-2efdd0c997de","block_type":"box","text":"recently.","page_number":208,"box":{"x":69,"y":75,"width":57,"height":11}},{"id":"59d0995f-e0cf-444a-b2d3-e13224d3b35f","block_type":"box","text":"We appreciate when companies regularly review and assess how directors nominated for election contribute to","page_number":208,"box":{"x":101,"y":98,"width":789,"height":11}},{"id":"8474f57c-41cf-42c9-ae79-56622173961a","block_type":"box","text":"the effectiveness of the board. In our view, the company’s assessment should consider a number of factors,","page_number":208,"box":{"x":68,"y":113,"width":774,"height":11}},{"id":"c78f9d97-1ecb-4abb-847a-821c88b41f39","block_type":"box","text":"including each director’s independence and time commitments, as well as the breadth and relevance of director","page_number":208,"box":{"x":70,"y":128,"width":798,"height":11}},{"id":"91a3fd7b-3324-4603-a216-5ae550e3bc55","block_type":"box","text":"experiences and skillsets, and how these collectively contribute to the board’s effectiveness in advising and","page_number":208,"box":{"x":69,"y":143,"width":770,"height":11}},{"id":"d2ef0b51-2574-49f0-b430-1389924d9805","block_type":"box","text":"overseeing management in delivering long-term financial returns.","page_number":208,"box":{"x":69,"y":158,"width":459,"height":11}},{"id":"15cc95ca-f859-4632-bea3-f2f1d65a70ed","block_type":"box","text":"Director independence","page_number":208,"box":{"x":69,"y":188,"width":164,"height":11}},{"id":"e8c1bbb5-80bb-4990-b291-4cb80aba9043","block_type":"box","text":"Director independence — from management, significant shareholders, or other related par ties — is a central","page_number":208,"box":{"x":102,"y":211,"width":777,"height":11}},{"id":"78ed8795-8706-4cc4-9d6a-77cc6fe04136","block_type":"box","text":"tenet of sound corporate governance across markets.","page_number":208,"box":{"x":68,"y":226,"width":382,"height":11}},{"id":"e9fb20ee-ec5e-48b7-8e9a-11771d2f6709","block_type":"box","text":"6","page_number":208,"box":{"x":452,"y":226,"width":4,"height":5}},{"id":"a6781c50-66c7-46d9-95ae-1bcc3bb37197","block_type":"box","text":"We look to boards to have a sufficient number of independent","page_number":208,"box":{"x":462,"y":226,"width":442,"height":11}},{"id":"1b10b014-886d-4f18-8d4f-16c15f266699","block_type":"box","text":"directors, free from conflicts of interest or undue influence, to ensure objectivity in the decision-making of the board","page_number":208,"box":{"x":69,"y":241,"width":825,"height":11}},{"id":"a9022a41-f684-41da-b449-3c1a14f0f0bc","block_type":"box","text":"and its ability to oversee management. We generally consider it good practice for independent directors to make a","page_number":208,"box":{"x":69,"y":256,"width":813,"height":12}},{"id":"e2578054-9cfa-41c4-81a1-9adc55fe1bca","block_type":"box","text":"majority of the board, or in the case of controlled companies, at least one-third.","page_number":208,"box":{"x":69,"y":271,"width":566,"height":12}},{"id":"77f30314-99d9-4138-bce6-eb0ee3eebbec","block_type":"box","text":"Common impediments to independence may include but are not limited to:","page_number":208,"box":{"x":102,"y":294,"width":531,"height":11}},{"id":"3ebcf14e-aa61-45ca-9401-23ce81bebf3a","block_type":"box","text":"•","page_number":208,"box":{"x":69,"y":317,"width":6,"height":5}},{"id":"9f6176ff-c060-47f3-bcd4-5c8241508c23","block_type":"box","text":"Current or recent employment at the company or a subsidiary","page_number":208,"box":{"x":102,"y":314,"width":438,"height":11}},{"id":"16806109-4245-40ab-8d96-c94a5f1aa93e","block_type":"box","text":"•","page_number":208,"box":{"x":69,"y":337,"width":6,"height":5}},{"id":"0773435b-65e6-4c48-afa7-f59947019a0e","block_type":"box","text":"Being, or representing, a shareholder with a substantial shareholding in the company","page_number":208,"box":{"x":102,"y":335,"width":606,"height":11}},{"id":"a2ae59f5-83fb-4952-9fe1-adb295ec18d8","block_type":"box","text":"•","page_number":208,"box":{"x":69,"y":357,"width":6,"height":5}},{"id":"a787967d-0bbb-45f4-846f-2840c64f0c6c","block_type":"box","text":"Interlocking directorates","page_number":208,"box":{"x":102,"y":355,"width":170,"height":11}},{"id":"f9645580-3228-4743-9b37-3b578c792b5b","block_type":"box","text":"•","page_number":208,"box":{"x":69,"y":378,"width":6,"height":4}},{"id":"9547c807-98da-4a18-b3f9-927cbe51be69","block_type":"box","text":"Having any other interest, business, or other relationship which could, or could reasonably be perceived to,","page_number":208,"box":{"x":102,"y":375,"width":761,"height":11}},{"id":"ea802fa1-7899-41b8-b37c-0b5ec59a8aaa","block_type":"box","text":"materially inter fere with a director’s ability to act in the best interests of the company and shareholders","page_number":208,"box":{"x":102,"y":390,"width":738,"height":11}},{"id":"796a9424-bbe9-4f34-aa0a-5765a266159c","block_type":"box","text":"In our experience, boards are most effective at overseeing and advising management when there is a senior,","page_number":208,"box":{"x":102,"y":412,"width":775,"height":12}},{"id":"0c7cb69c-f599-4214-9c0f-0dfd3940baae","block_type":"box","text":"independent board leader. This director may chair the board, or, where the chair is also the CEO (or is otherwise not","page_number":208,"box":{"x":70,"y":428,"width":827,"height":11}},{"id":"594faf8d-5bd3-4e67-bd34-b1d89e71c1b5","block_type":"box","text":"independent), be designated as a lead independent director. The role of this director is to suppor t independent board","page_number":208,"box":{"x":70,"y":443,"width":835,"height":11}},{"id":"952da565-39d6-419d-b0d3-68ea2d9288e2","block_type":"box","text":"members in fulfilling their oversight responsibilities effectively by shaping the agenda, ensuring adequate information","page_number":208,"box":{"x":69,"y":458,"width":834,"height":11}},{"id":"83331b0b-4865-4a27-a946-1e16ebb5dd84","block_type":"box","text":"is provided to the board, and encouraging independent director par ticipation in board deliberations. We appreciate","page_number":208,"box":{"x":70,"y":473,"width":813,"height":11}},{"id":"04c864bf-17c5-4bd4-b80a-42103c15f0a1","block_type":"box","text":"when the lead independent director or another appropriate director is available to meet with shareholders to explain","page_number":208,"box":{"x":68,"y":488,"width":826,"height":11}},{"id":"b245fbdd-76d6-4347-a38d-caf3fe5c289f","block_type":"box","text":"and contextualize a company’s approach as a situation warrants.","page_number":208,"box":{"x":69,"y":503,"width":463,"height":11}},{"id":"987d92b0-3e99-461e-bbe7-926b35874cdf","block_type":"box","text":"Boards may face matters that could involve conflicts of interest for executives or affiliated directors, or that","page_number":208,"box":{"x":102,"y":526,"width":765,"height":11}},{"id":"d529e02a-7d3f-4738-bdb4-9224bb8ff9c2","block_type":"box","text":"require additional focus. It is our view that objective oversight of such matters is best achieved when the board forms","page_number":208,"box":{"x":69,"y":541,"width":837,"height":11}},{"id":"8a9ee3af-1116-4b34-990c-4c9f0ffea846","block_type":"box","text":"committees with a majority of independent directors, depending on market norms and a company’s ownership","page_number":208,"box":{"x":69,"y":556,"width":784,"height":11}},{"id":"bee475ad-4aca-446c-9e10-a97229ad2271","block_type":"box","text":"structure. In many markets, these committees of the board specialize in audit, director nominations, and","page_number":208,"box":{"x":69,"y":571,"width":747,"height":11}},{"id":"856a422b-02a0-415f-b553-b78548070f7b","block_type":"box","text":"compensation matters, among others. An ad hoc committee might also be formed to decide on a special transaction,","page_number":208,"box":{"x":69,"y":586,"width":836,"height":12}},{"id":"517dfa3c-6098-4a40-8525-5c495d1d74d4","block_type":"box","text":"par ticularly one involving a related par ty, or to investigate a significant adverse event.","page_number":208,"box":{"x":70,"y":601,"width":607,"height":12}},{"id":"14b30bbb-f271-47fb-ad87-5089dd583fd6","block_type":"box","text":"Sufficient capacity","page_number":208,"box":{"x":68,"y":632,"width":137,"height":11}},{"id":"fbfb7f6c-59b5-40f9-beb9-e62cc9320163","block_type":"box","text":"As the role and expectations of a director are increasingly demanding, directors must be able to commit an","page_number":208,"box":{"x":101,"y":654,"width":763,"height":12}},{"id":"950ed326-ec4f-4550-bc81-57ccb75146e7","block_type":"box","text":"appropriate amount of time to board and committee matters. It is impor tant that directors have the capacity to meet","page_number":208,"box":{"x":69,"y":669,"width":830,"height":12}},{"id":"7d3825f6-04b3-4211-a8a7-6402f969688a","block_type":"box","text":"all of their responsibilities — including when there are unforeseen events — and therefore, we consider it best","page_number":208,"box":{"x":69,"y":685,"width":791,"height":11}},{"id":"4f2f273f-1bcd-43c8-97b6-972f189c63e8","block_type":"box","text":"practice when they don’t take on an excessive number of roles that would impair their ability to fulfill their duties.","page_number":208,"box":{"x":70,"y":700,"width":804,"height":11}},{"id":"225aa0ad-6bda-4b47-bae9-8ad1ea837e63","block_type":"box","text":"Board composition","page_number":208,"box":{"x":69,"y":730,"width":135,"height":11}},{"id":"d5a53864-4605-4b9d-9076-2a199cff0c30","block_type":"box","text":"In assessing board composition, we take into account a company’s board size, business model, strategy, market","page_number":208,"box":{"x":102,"y":753,"width":806,"height":11}},{"id":"0196cc37-a9e7-441b-bb07-d24ab93e1dce","block_type":"box","text":"capitalization, and ownership structure, as well as the market in which the company operates. We find it helpful when","page_number":208,"box":{"x":69,"y":768,"width":836,"height":11}},{"id":"9702b0ad-8f51-44b6-8c22-64be774b1d5b","block_type":"box","text":"companies explain how their approach to board composition suppor ts the company’s governance practices.","page_number":208,"box":{"x":69,"y":783,"width":767,"height":11}},{"id":"1beb4ec8-b600-48d0-90c1-00a644274e33","block_type":"box","text":"When nominating directors to the board, we look to companies to provide sufficient information on the individual","page_number":208,"box":{"x":101,"y":806,"width":802,"height":11}},{"id":"1ed9de27-3939-4762-b2af-b8d49e376f45","block_type":"box","text":"candidates so that shareholders can assess the capabilities and suitability of each individual nominee and their fit","page_number":208,"box":{"x":69,"y":821,"width":818,"height":11}},{"id":"ac6936ad-b39b-4468-9ea1-77d54586bd2b","block_type":"box","text":"within overall board composition. These disclosures should explain how the collective experience and exper tise of the","page_number":208,"box":{"x":68,"y":836,"width":840,"height":11}},{"id":"b1093c4b-36b2-4610-b3e8-7c9d0abb6117","block_type":"box","text":"board, as well as the par ticular skillsets of individual directors, aligns with the company’s long-term strategy. Highly","page_number":208,"box":{"x":69,"y":851,"width":823,"height":11}},{"id":"79c5de9e-0abb-4234-8fea-5fa9172e07a0","block_type":"box","text":"6","page_number":208,"box":{"x":69,"y":881,"width":4,"height":4}},{"id":"1ecd5143-b81e-4f68-b59f-f93c2081299c","block_type":"box","text":"For example, please see: Tokyo Stock Exchange, “Japan’s Corporate Governance Code,” June 11, 2021; Financial","page_number":208,"box":{"x":79,"y":880,"width":813,"height":11}},{"id":"9e9b43f6-f9df-4348-ba79-8028bc573f43","block_type":"box","text":"Repor ting Council, “UK Corporate Governance Code,” January 2024, accessed in December 2025.","page_number":208,"box":{"x":70,"y":895,"width":704,"height":12}},{"id":"e1e07ebe-cc73-4ee1-b13b-4bffd7afc69b","block_type":"box","text":"BlackRock Investment Stewardship","page_number":208,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"7197b6f6-b1e6-4859-8822-67a390b4f2c4","block_type":"box","text":"Global Principles | 6","page_number":208,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"60d539af-4978-4b81-a163-78737a920abe","block_type":"box","text":"NM1026U-5982568-208/232","page_number":208,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"8e341c14-f9b8-434b-9919-1ed481634ef5","block_type":"box","text":"qualified, engaged directors with professional characteristics relevant to a company’s business and strategy enhance","page_number":209,"box":{"x":69,"y":45,"width":836,"height":11}},{"id":"b59ff7da-6b5e-430e-a971-d5568c01b5f9","block_type":"box","text":"the ability of the board to add value and be the voice of shareholders in board discussions.","page_number":209,"box":{"x":68,"y":60,"width":650,"height":11}},{"id":"9d596a78-bb4c-4e0d-b42e-b28f08a3a390","block_type":"box","text":"It is in this context that we are interested in a variety of experiences, perspectives, and skillsets in the board","page_number":209,"box":{"x":102,"y":82,"width":775,"height":12}},{"id":"e0587838-9501-45b1-acfc-b5a435f1159c","block_type":"box","text":"room. We see it as a means of avoiding “group think” in the board’s exercise of its responsibilities to advise and","page_number":209,"box":{"x":69,"y":98,"width":806,"height":11}},{"id":"86eda20b-c93d-44cf-b3cd-d0b8b0779688","block_type":"box","text":"oversee management. We note that in many markets, policymakers have set board gender diversity goals which we","page_number":209,"box":{"x":69,"y":113,"width":820,"height":11}},{"id":"6bd17246-d440-4613-b025-ab37d573394c","block_type":"box","text":"may discuss with companies, par ticularly if there is a risk their board composition may be misaligned.","page_number":209,"box":{"x":69,"y":128,"width":726,"height":11}},{"id":"f2291745-d05d-4b34-9433-ea28907644b7","block_type":"box","text":"AUDITORS AND AUDIT-RELATED ISSUES","page_number":209,"box":{"x":342,"y":158,"width":293,"height":9}},{"id":"e7454f43-a734-4855-8a38-d3a33ffd34a3","block_type":"box","text":"BIS recognizes the critical impor tance of financial statements to provide a complete and accurate por trayal of a","page_number":209,"box":{"x":102,"y":181,"width":795,"height":11}},{"id":"f40ba985-d531-4a64-a4a7-48cceed69168","block_type":"box","text":"company’s financial condition. Accordingly, we look for the assumptions made by management, and reviewed by the","page_number":209,"box":{"x":69,"y":196,"width":825,"height":11}},{"id":"20ba4422-c14f-43b5-9ebb-276c2d65612b","block_type":"box","text":"auditor in preparing the financial statements, to be reasonable and justified.","page_number":209,"box":{"x":69,"y":211,"width":543,"height":11}},{"id":"4dca86e3-f7e2-44e1-9b16-f7f4321416f4","block_type":"box","text":"We view the audit committee, or its equivalent, as responsible for overseeing the management of the","page_number":209,"box":{"x":101,"y":234,"width":722,"height":11}},{"id":"749de7b4-df62-448a-85a0-7d9830627b19","block_type":"box","text":"independent auditor and the internal audit function at a company. The committee plays an impor tant role in a","page_number":209,"box":{"x":70,"y":249,"width":778,"height":11}},{"id":"d52a9980-78d2-400d-be45-2663fab6b30f","block_type":"box","text":"company’s financial repor ting system by providing independent oversight of the accounts, material financial, and,","page_number":209,"box":{"x":69,"y":264,"width":806,"height":11}},{"id":"31d08aa0-775c-4496-9538-e3d58b58ef25","block_type":"box","text":"where appropriate to the jurisdiction, non-financial information and internal control frameworks. Moreover, in the","page_number":209,"box":{"x":68,"y":279,"width":799,"height":11}},{"id":"d7b5d56e-eb37-493e-bd53-521f2d8c0cde","block_type":"box","text":"absence of a dedicated risk committee, these committees can provide oversight of Enterprise Risk Management","page_number":209,"box":{"x":69,"y":294,"width":801,"height":11}},{"id":"bda530ac-00d5-4a70-b8ce-66da732229ff","block_type":"box","text":"systems.","page_number":209,"box":{"x":69,"y":310,"width":62,"height":10}},{"id":"e98cb880-b1af-4c3e-9057-bb93df471d3f","block_type":"box","text":"7","page_number":209,"box":{"x":133,"y":310,"width":4,"height":4}},{"id":"b60d1ded-b398-42bf-972f-c5f7c9924c03","block_type":"box","text":"In our view, effective audit committee oversight strengthens the quality and reliability of a company’s","page_number":209,"box":{"x":144,"y":309,"width":717,"height":11}},{"id":"d4d70cac-c4cc-47cc-9fa1-fb6e50fa3ac1","block_type":"box","text":"financial statements and provides an impor tant level of reassurance to shareholders.","page_number":209,"box":{"x":68,"y":324,"width":609,"height":11}},{"id":"184c344a-3e86-42b4-becf-80f5ef7add98","block_type":"box","text":"We look to audit committees, or their equivalent, to have clearly ar ticulated char ters that set out their","page_number":209,"box":{"x":101,"y":347,"width":727,"height":11}},{"id":"8e96b319-dded-46c6-aba7-4bcc5c80d333","block_type":"box","text":"responsibilities. Additionally, having a rotation plan can periodically refresh the committee membership and introduce","page_number":209,"box":{"x":69,"y":362,"width":835,"height":11}},{"id":"f406a1a6-2c80-4f14-b2ce-d0427fa499d3","block_type":"box","text":"new perspectives. We recognize that audit committees will rely on management, internal audit, and the independent","page_number":209,"box":{"x":69,"y":377,"width":827,"height":12}},{"id":"ec645cb8-eef3-43d8-9ebb-b47d52ef9c4f","block_type":"box","text":"auditor to fulfill their responsibilities. However, we look to committee members to demonstrate they have relevant","page_number":209,"box":{"x":69,"y":392,"width":810,"height":12}},{"id":"dd019564-ac16-47b4-b886-c28a0d3a97cc","block_type":"box","text":"exper tise to monitor and oversee the audit process and related activities.","page_number":209,"box":{"x":69,"y":408,"width":523,"height":10}},{"id":"e63ffd67-c224-426e-9d34-2c1053b414f5","block_type":"box","text":"We take par ticular note of unexplained changes in repor ting methodology, cases involving significant financial","page_number":209,"box":{"x":101,"y":430,"width":780,"height":11}},{"id":"3356d5dd-d25c-4ecb-8b67-5050be5c367f","block_type":"box","text":"restatements, or ad hoc notifications of material financial weakness. In this respect, we look to audit committees to","page_number":209,"box":{"x":69,"y":445,"width":828,"height":11}},{"id":"da1eab1d-8af8-49c9-83d7-240c8748deb5","block_type":"box","text":"provide timely disclosure on the remediation of key and critical audit matters identified either by the external auditor","page_number":209,"box":{"x":70,"y":460,"width":827,"height":12}},{"id":"063e8f87-6b56-4461-aa01-0647040bb38f","block_type":"box","text":"or internal audit function.","page_number":209,"box":{"x":69,"y":475,"width":178,"height":9}},{"id":"916a39b7-acea-441b-b826-88c4487ad445","block_type":"box","text":"The integrity of financial statements depends on the auditor being free of any impediments that could","page_number":209,"box":{"x":101,"y":498,"width":723,"height":11}},{"id":"f19a3e19-f5cb-4f6a-91c6-279c9ebc5ac6","block_type":"box","text":"compromise its ability to serve as an effective check on management. To that end, it is impor tant that auditors are,","page_number":209,"box":{"x":69,"y":513,"width":825,"height":12}},{"id":"299cb60d-6c3d-4920-bb13-384545603cc9","block_type":"box","text":"and are seen to be, independent. Where an audit firm provides services to the company in addition to the audit, we","page_number":209,"box":{"x":69,"y":528,"width":824,"height":12}},{"id":"bee2c337-0008-496e-a547-0f7375d1c6fe","block_type":"box","text":"look for the fees earned to be disclosed and explained. We look for audit committees to have in place a procedure for","page_number":209,"box":{"x":70,"y":543,"width":839,"height":11}},{"id":"8013632c-11e7-4edf-9d61-1c1fa9d11d6a","block_type":"box","text":"assessing the independence of the auditor and the quality of the external audit process on an annual basis.","page_number":209,"box":{"x":69,"y":559,"width":770,"height":11}},{"id":"c6999446-2f03-4e07-bfa7-aacc51c93a6e","block_type":"box","text":"Comprehensive disclosure provides investors with an understanding of the company’s long-term operational risk","page_number":209,"box":{"x":102,"y":581,"width":799,"height":12}},{"id":"cf0f70ce-7c4d-41e2-820f-ef2e71be725a","block_type":"box","text":"management practices and, more broadly, the quality of the board’s oversight. We look to the audit or risk committee","page_number":209,"box":{"x":69,"y":596,"width":836,"height":12}},{"id":"f1cee506-4497-45f8-a621-8e75f854adf4","block_type":"box","text":"to periodically review the company’s risk assessment and risk management policies and the significant risks and","page_number":209,"box":{"x":68,"y":612,"width":806,"height":11}},{"id":"56af2cc9-5cdc-452f-b6ec-bfbf430a1323","block_type":"box","text":"exposures identified by management, the internal auditors or the independent auditors, and management’s steps to","page_number":209,"box":{"x":69,"y":627,"width":829,"height":11}},{"id":"a0cd527f-cf9a-496d-89b0-7fdd9003a20a","block_type":"box","text":"address them. In the absence of detailed disclosures, we may conclude that companies are not adequately managing","page_number":209,"box":{"x":69,"y":642,"width":840,"height":11}},{"id":"d36ce182-1fd4-493a-b5b1-e5b3f2170e0e","block_type":"box","text":"risk.","page_number":209,"box":{"x":69,"y":657,"width":28,"height":9}},{"id":"b2928bad-07b6-4a17-82b4-6ce2fa11ce64","block_type":"box","text":"CAPITAL STRUCTURE, MERGERS, ACQUISITIONS, ASSET SALES, AND OTHER SPECIAL SITUATIONS","page_number":209,"box":{"x":125,"y":687,"width":728,"height":11}},{"id":"7d6ba5fa-6b2e-481d-97fa-b2ba3abe58c5","block_type":"box","text":"The capital structure of a company is critical to shareholders as it impacts the value of their investment and the","page_number":209,"box":{"x":101,"y":710,"width":798,"height":11}},{"id":"f6ceea4c-85f5-41df-ba77-ab753436fe17","block_type":"box","text":"priority of their interest in the company relative to that of other equity or debt investors. Pre-emptive rights are a key","page_number":209,"box":{"x":70,"y":725,"width":824,"height":11}},{"id":"6aa0995b-b118-421d-a10a-429a42c3cc57","block_type":"box","text":"protection for shareholders against the dilution of their interests.","page_number":209,"box":{"x":70,"y":740,"width":460,"height":11}},{"id":"aed45895-72db-4ca7-8003-efe66de7462f","block_type":"box","text":"In principle, we have concerns with the creation of a share class with equivalent economic exposure and","page_number":209,"box":{"x":102,"y":763,"width":743,"height":11}},{"id":"0fd40d96-208f-45ec-a56c-edaa6eb6f6f7","block_type":"box","text":"differentiated voting rights. As a result, BIS generally suppor ts bylaw amendments that introduce the adoption of","page_number":209,"box":{"x":69,"y":778,"width":805,"height":11}},{"id":"d9f9fba9-9fc5-4f7d-a27a-285a936eb13a","block_type":"box","text":"“one share, one vote” for registered shareholders.","page_number":209,"box":{"x":70,"y":793,"width":358,"height":11}},{"id":"e9e44d56-809b-4065-9ead-60920fc86b72","block_type":"box","text":"7","page_number":209,"box":{"x":69,"y":823,"width":4,"height":4}},{"id":"6aa65278-7e79-4b81-8d84-81ab5f13189a","block_type":"box","text":"Enterprise Risk Management is a process, effected by the entity’s board of directors, management, and other","page_number":209,"box":{"x":79,"y":822,"width":784,"height":12}},{"id":"a5748869-ec93-4079-a229-dfdd5aff3faa","block_type":"box","text":"personnel, applied in strategy setting and across the enterprise, designed to identify potential events that may affect","page_number":209,"box":{"x":70,"y":837,"width":834,"height":12}},{"id":"c717ded5-6c23-46e6-9983-9970c000464d","block_type":"box","text":"the entity, and manage risk to be within the risk appetite, to provide reasonable assurance regarding the achievement","page_number":209,"box":{"x":68,"y":853,"width":841,"height":11}},{"id":"529a8be3-3dad-47ba-b125-f6f0b93b0914","block_type":"box","text":"of objectives. Please see: The Committee of Sponsoring Organizations of the Treadway Commission (COSO),","page_number":209,"box":{"x":69,"y":868,"width":771,"height":11}},{"id":"cdd5c917-9c20-48a3-9540-0dd65cff832b","block_type":"box","text":"“Enterprise Risk Management,” 2023, accessed in December 2025.","page_number":209,"box":{"x":70,"y":883,"width":488,"height":11}},{"id":"4440e77e-cde7-4fd5-b4ad-c836a8f4a437","block_type":"box","text":"BlackRock Investment Stewardship","page_number":209,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"1aece38f-f797-4620-8487-4f69454b0989","block_type":"box","text":"Global Principles | 7","page_number":209,"box":{"x":768,"y":942,"width":140,"height":13}},{"id":"3231e42e-3d0e-412d-9936-cf92ccbeb7fe","block_type":"box","text":"NM1026U-5982568-209/232","page_number":209,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"37d135c9-9e4c-4aa0-8198-2f66fc5830d1","block_type":"box","text":"However, we recognize that in cer tain markets, at least for a period of time, companies may have a valid reason","page_number":210,"box":{"x":102,"y":45,"width":798,"height":11}},{"id":"aa515062-da7f-473c-9ada-4c50d1006fc8","block_type":"box","text":"for listing dual classes of shares with differentiated voting rights. In our view, such companies should review these","page_number":210,"box":{"x":68,"y":60,"width":818,"height":11}},{"id":"06ecbaae-9c20-4734-94f6-828609a18c24","block_type":"box","text":"share class structures on a regular basis or as company circumstances change. Additionally, they should seek","page_number":210,"box":{"x":69,"y":75,"width":788,"height":11}},{"id":"93e03906-7845-4967-bd6c-4cafbac73a83","block_type":"box","text":"shareholder approval of their capital structure on a periodic basis via a management proposal at the company’s","page_number":210,"box":{"x":69,"y":90,"width":797,"height":11}},{"id":"61c3e410-70b2-4d23-a86f-6901fc7d5c5a","block_type":"box","text":"shareholder meeting. The proposal should give unaffiliated shareholders the oppor tunity to affirm the current","page_number":210,"box":{"x":69,"y":105,"width":780,"height":11}},{"id":"b1785663-3fe8-400d-b9dc-d1ec780b07cb","block_type":"box","text":"structure or establish mechanisms to end or phase out controlling structures at the appropriate time, while","page_number":210,"box":{"x":69,"y":120,"width":764,"height":12}},{"id":"87d7d3d3-9119-41df-a3ac-cab36b3f5703","block_type":"box","text":"minimizing costs to shareholders.","page_number":210,"box":{"x":69,"y":136,"width":238,"height":11}},{"id":"2ac12484-5c4f-4a0c-b306-ea0ea32c886c","block_type":"box","text":"In assessing mergers, asset sales, or other special situations, BIS’ primary consideration is the long-term","page_number":210,"box":{"x":102,"y":158,"width":756,"height":11}},{"id":"54a7c312-6096-4ecb-a406-65e372e72e2e","block_type":"box","text":"financial interests of our clients as shareholders, and so we will review any proposed transaction with that objective","page_number":210,"box":{"x":68,"y":173,"width":826,"height":11}},{"id":"29c60615-0313-4713-b4c6-66c7f5278d1b","block_type":"box","text":"in mind. Typically, we review factors such as whether the proposed transaction has the unanimous suppor t of the","page_number":210,"box":{"x":70,"y":188,"width":806,"height":11}},{"id":"d45885fd-b79e-454c-9214-f4bbcaafd55e","block_type":"box","text":"board and has been negotiated at arm’s length, and whether the board or management has clearly explained its","page_number":210,"box":{"x":69,"y":204,"width":799,"height":11}},{"id":"403bbc0a-3534-4d5f-af2e-4f4809c728b2","block_type":"box","text":"economic and strategic rationale. We may also seek reassurance from the board that the financial interests of","page_number":210,"box":{"x":69,"y":218,"width":788,"height":12}},{"id":"6224e791-977b-4e23-845c-94d282865b5b","block_type":"box","text":"executives and/or board members in a given transaction have not adversely affected their ability to place","page_number":210,"box":{"x":69,"y":234,"width":750,"height":11}},{"id":"f6ee0677-dc60-4ac9-a2b6-e575dc969863","block_type":"box","text":"shareholders’ interests before their own. Where the transaction involves related par ties, the recommendation to","page_number":210,"box":{"x":69,"y":249,"width":801,"height":11}},{"id":"91261d01-bfd2-40b9-9f5e-6f81d2596bc5","block_type":"box","text":"suppor t should come from the independent directors, a best practice in most markets, and ideally, the terms should","page_number":210,"box":{"x":69,"y":264,"width":830,"height":11}},{"id":"4e9d55f6-241c-4002-8973-eb4387469774","block_type":"box","text":"have been assessed through an independent appraisal process. In addition, it is good practice that it be approved by","page_number":210,"box":{"x":69,"y":279,"width":836,"height":11}},{"id":"961ac931-d2d6-4f71-a489-fdbb24986c19","block_type":"box","text":"a separate vote of the non-conflicted par ties.","page_number":210,"box":{"x":69,"y":294,"width":320,"height":11}},{"id":"4d1d339c-7ae2-4ce4-8012-259bda4b9422","block_type":"box","text":"As a matter of sound governance practice, shareholders should have a right to dispose of company shares in the","page_number":210,"box":{"x":101,"y":317,"width":806,"height":11}},{"id":"25705bd4-928a-47c9-8f6b-0711689d76e4","block_type":"box","text":"open market without unnecessary restriction. In our view, corporate mechanisms designed to limit shareholders’","page_number":210,"box":{"x":69,"y":332,"width":801,"height":11}},{"id":"97dca15b-20be-4859-b455-a13ee89ba186","block_type":"box","text":"ability to sell their shares are contrary to basic proper ty rights. Such mechanisms can serve to protect and entrench","page_number":210,"box":{"x":69,"y":347,"width":829,"height":11}},{"id":"31eee3b6-379b-4729-a5dc-ad6486693bce","block_type":"box","text":"interests other than those of the shareholders. In our view, shareholders are broadly capable of making decisions in","page_number":210,"box":{"x":70,"y":362,"width":826,"height":11}},{"id":"4aedb0ce-8627-4fa4-87da-97ce337798c9","block_type":"box","text":"their own best interests. We encourage any shareholder rights plans proposed by a board to be subject to","page_number":210,"box":{"x":68,"y":377,"width":755,"height":12}},{"id":"5875f9a9-b4c2-4c06-b542-45781b6020e3","block_type":"box","text":"shareholder approval upon introduction and periodically thereafter.","page_number":210,"box":{"x":69,"y":392,"width":472,"height":12}},{"id":"fd476cde-0757-4728-9e41-21e4f283c048","block_type":"box","text":"EXECUTIVE COMPENSATION AND BENEFITS","page_number":210,"box":{"x":328,"y":423,"width":322,"height":9}},{"id":"f6b32f8a-b087-4002-a0d2-a4a72df87643","block_type":"box","text":"Executive compensation is an impor tant tool used by companies to suppor t long-term financial value creation. A","page_number":210,"box":{"x":102,"y":445,"width":799,"height":12}},{"id":"cbee81c1-1c22-44de-8044-7f9a23a2ac01","block_type":"box","text":"well-structured compensation policy rewards the successful delivery of strategic, operational, and/or financial goals;","page_number":210,"box":{"x":68,"y":460,"width":830,"height":12}},{"id":"30e818ef-09c4-4dbc-9bbe-38ed418a08d6","block_type":"box","text":"encourages an appropriate risk appetite; and aligns the interests of shareholders and executives through equity","page_number":210,"box":{"x":69,"y":475,"width":797,"height":12}},{"id":"22af569c-8619-4a0c-9cc5-08078c3cad92","block_type":"box","text":"ownership.","page_number":210,"box":{"x":69,"y":491,"width":75,"height":11}},{"id":"fcb32fec-5a0c-4c7f-b766-70713c547b80","block_type":"box","text":"8","page_number":210,"box":{"x":146,"y":491,"width":4,"height":4}},{"id":"aca8ae41-a9f1-4574-9fa8-09e23c5510f5","block_type":"box","text":"We look for a clear link between variable pay and operational and financial per formance that suppor t sustained","page_number":210,"box":{"x":101,"y":513,"width":793,"height":11}},{"id":"9aca5e54-6447-40e7-9390-1485958c4b8d","block_type":"box","text":"financial value creation for our clients as shareholders. We appreciate when per formance targets incorporate","page_number":210,"box":{"x":68,"y":528,"width":778,"height":12}},{"id":"9500c5de-b775-4e06-a507-a6906e4ce203","block_type":"box","text":"ambitious objectives, and the corresponding metrics are aligned with the company’s strategy and business model.","page_number":210,"box":{"x":69,"y":544,"width":815,"height":11}},{"id":"4ddddb0d-c6bf-4d64-8650-928b780a06fb","block_type":"box","text":"BIS does not have a position on whether companies choose to use sustainability-related criteria in compensation","page_number":210,"box":{"x":70,"y":559,"width":804,"height":11}},{"id":"d1b92210-9124-438f-a5f7-4c12609bb51d","block_type":"box","text":"structures, but, where they are included, we look to companies to be as rigorous as they would be in setting other","page_number":210,"box":{"x":69,"y":574,"width":814,"height":11}},{"id":"3c1c124e-4696-4adf-8eb5-95bf26dc7b00","block_type":"box","text":"financial or operational targets. We appreciate when long-term incentive plans encompass timeframes that: 1) are","page_number":210,"box":{"x":68,"y":589,"width":813,"height":11}},{"id":"a102e805-3ea4-458f-80bc-084a57557a8d","block_type":"box","text":"distinct from annual executive compensation structures and metrics, and 2) encourage the delivery of strong financial","page_number":210,"box":{"x":69,"y":604,"width":839,"height":11}},{"id":"aa071e90-73d0-470d-b9e1-11f8c7af8d1b","block_type":"box","text":"results over a period of years.","page_number":210,"box":{"x":69,"y":619,"width":211,"height":11}},{"id":"f88518da-0ae0-4e09-bbd8-3ea90bdd390f","block_type":"box","text":"We consider it best practice when board members responsible for designing and approving executive","page_number":210,"box":{"x":101,"y":642,"width":718,"height":11}},{"id":"2e3af880-5901-4c09-8eef-1a35918acbee","block_type":"box","text":"compensation carefully consider the company’s specific circumstances. Factors to consider may include the","page_number":210,"box":{"x":69,"y":657,"width":770,"height":11}},{"id":"414cf584-ea3a-4b5a-a498-2f86460aadf7","block_type":"box","text":"company’s risk profile, the environment it operates in, and the individuals the board is trying to attract and retain. We","page_number":210,"box":{"x":69,"y":672,"width":838,"height":11}},{"id":"7e972dcd-6cc0-42e0-8bf4-a58e2837a392","block_type":"box","text":"look to the compensation committees to guard against contractual arrangements that would entitle executives to","page_number":210,"box":{"x":70,"y":687,"width":804,"height":11}},{"id":"4c4fa6ee-8700-4e48-a568-372b52e346ed","block_type":"box","text":"material compensation for early termination of their employment. Finally, we look for pension contributions and other","page_number":210,"box":{"x":69,"y":702,"width":831,"height":11}},{"id":"8e9aa37d-773c-4861-b9d2-47e1758bf51c","block_type":"box","text":"deferred compensation arrangements to be reasonable in light of market practices or the company’s business and","page_number":210,"box":{"x":69,"y":717,"width":817,"height":12}},{"id":"0a486169-1d8e-41d0-aa10-2f0b2d8a1a1b","block_type":"box","text":"executive compensation strategies.","page_number":210,"box":{"x":69,"y":733,"width":250,"height":11}},{"id":"db561b69-baf5-4c42-b2db-451f2f882b39","block_type":"box","text":"We are not suppor tive of one-off or special bonuses unrelated to company or individual per formance. Where","page_number":210,"box":{"x":101,"y":755,"width":772,"height":11}},{"id":"469211f3-1838-46c5-b72e-c140217bbb60","block_type":"box","text":"discretion has been used by the compensation committee, or its equivalent, we appreciate disclosure relating to how","page_number":210,"box":{"x":69,"y":771,"width":836,"height":11}},{"id":"eecf5580-9191-423e-9579-1af95d29a8bb","block_type":"box","text":"and why the discretion was used, and how the adjusted outcome is aligned with the interests of shareholders. In","page_number":210,"box":{"x":69,"y":785,"width":803,"height":12}},{"id":"54d7c18d-9eb6-40fd-8857-8fce546d2a99","block_type":"box","text":"addition, we acknowledge that the use of peer group evaluation by compensation committees can help ensure","page_number":210,"box":{"x":69,"y":801,"width":785,"height":11}},{"id":"09e2b822-6a24-43eb-901f-6db7efd3fb41","block_type":"box","text":"competitive pay. However, we encourage companies to clearly explain how compensation outcomes have rewarded","page_number":210,"box":{"x":69,"y":816,"width":815,"height":11}},{"id":"58a29578-5f06-4124-b343-e97bd660f15d","block_type":"box","text":"per formance rather than solely base increases in total compensation on peer benchmarking.","page_number":210,"box":{"x":70,"y":831,"width":659,"height":11}},{"id":"b4657a29-bdf6-49b0-80c2-74d5fad90cde","block_type":"box","text":"8","page_number":210,"box":{"x":69,"y":860,"width":4,"height":5}},{"id":"c853e367-ee63-4649-bca5-b1ba1ebee0c9","block_type":"box","text":"The terms “compensation,” “remuneration,” and “pay” are used interchangeably to describe the same concept in","page_number":210,"box":{"x":78,"y":860,"width":811,"height":11}},{"id":"38d539fa-472b-4513-badc-b7a6ea2eefbe","block_type":"box","text":"different markets.","page_number":210,"box":{"x":69,"y":875,"width":126,"height":9}},{"id":"ab04e955-5c6f-4940-bf62-f134bde74cce","block_type":"box","text":"BlackRock Investment Stewardship","page_number":210,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"363060e0-48b5-4ccb-a735-b04c6183346a","block_type":"box","text":"Global Principles | 8","page_number":210,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"15dd5a2c-5e25-45df-8bbb-ec5c0f429da0","block_type":"box","text":"NM1026U-5982568-210/232","page_number":210,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"929e6b4e-c2a4-4760-b57b-04b1f1b5d3f5","block_type":"box","text":"We consider the inclusion of building clawback provisions into incentive plans as good practice. Such provisions","page_number":211,"box":{"x":101,"y":45,"width":797,"height":11}},{"id":"c7cd0daa-94d2-4924-9441-6bf23cd5e58b","block_type":"box","text":"could require executives to forgo awards when compensation was based on faulty financial statements or deceptive","page_number":211,"box":{"x":69,"y":60,"width":825,"height":11}},{"id":"23133a91-4844-44ea-86a9-e0316cc58b43","block_type":"box","text":"business practices, or when their behavior caused material financial harm to shareholders, material reputational risk","page_number":211,"box":{"x":69,"y":75,"width":833,"height":11}},{"id":"149f7b5b-de43-463e-8901-98a662f63fe4","block_type":"box","text":"to the company, or resulted in a criminal investigation.","page_number":211,"box":{"x":68,"y":90,"width":386,"height":11}},{"id":"ecaf4af0-3f73-45cb-841c-fa0634fefe75","block_type":"box","text":"In our view, non-executive directors should be compensated in a manner that is commensurate with the time and","page_number":211,"box":{"x":102,"y":113,"width":803,"height":11}},{"id":"50293a5a-b21c-46d5-b1a9-5edbd6110600","block_type":"box","text":"effor t expended in fulfilling their professional responsibilities. Additionally, these compensation arrangements should","page_number":211,"box":{"x":69,"y":128,"width":834,"height":11}},{"id":"56fdcdd4-9b45-4872-a690-5c129366f12b","block_type":"box","text":"not risk compromising directors’ independence or aligning their interests too closely with those of the management,","page_number":211,"box":{"x":69,"y":143,"width":825,"height":11}},{"id":"a0ba157e-880f-4673-952d-5062f947e35c","block_type":"box","text":"whom they are charged with overseeing.","page_number":211,"box":{"x":68,"y":158,"width":285,"height":11}},{"id":"a966fed9-b7d3-431c-8c6d-507b73c23320","block_type":"box","text":"When assessing compensation proposals, BIS reviews companies’ disclosures to determine whether the board’s","page_number":211,"box":{"x":101,"y":181,"width":807,"height":11}},{"id":"176d9f98-2194-48a7-af73-79e863f51260","block_type":"box","text":"approach to executive compensation is rigorous in light of the company’s stated long-term corporate strategy and","page_number":211,"box":{"x":69,"y":196,"width":807,"height":11}},{"id":"0e7df4a7-0515-454c-99cb-16d0e86bf025","block_type":"box","text":"specific circumstances, as well as local market and policy developments.","page_number":211,"box":{"x":69,"y":211,"width":521,"height":11}},{"id":"664e5334-51f1-419f-b9f8-90e877c5f3e7","block_type":"box","text":"When our analysis indicates that executive compensation is misaligned with company per formance, BIS may not","page_number":211,"box":{"x":101,"y":234,"width":802,"height":11}},{"id":"fb422583-a021-460f-ab71-24a855ce1f86","block_type":"box","text":"suppor t management’s proposals to approve compensation, where they are on the agenda. We may also not suppor t","page_number":211,"box":{"x":69,"y":249,"width":838,"height":11}},{"id":"a2320fdb-e20e-46d0-95ed-51e9ee033a3e","block_type":"box","text":"members of the compensation committee or equivalent board members for poor compensation practices or","page_number":211,"box":{"x":69,"y":264,"width":766,"height":11}},{"id":"626547ef-d61d-48f2-940a-67e99f4369d2","block_type":"box","text":"structures.","page_number":211,"box":{"x":69,"y":280,"width":76,"height":8}},{"id":"fd01389f-da04-4644-8405-2e33e8291fb3","block_type":"box","text":"SHAREHOLDER PROTECTIONS AND OTHER CORPORATE GOVERNANCE MATTERS","page_number":211,"box":{"x":191,"y":309,"width":595,"height":9}},{"id":"e464187c-2077-4751-bde1-99f6fdd1a908","block_type":"box","text":"Corporate form","page_number":211,"box":{"x":69,"y":339,"width":108,"height":11}},{"id":"d77d4c6e-0749-4e09-9807-ac5cbaa36fda","block_type":"box","text":"In our view, it is the responsibility of the board to determine the corporate form that is most appropriate given","page_number":211,"box":{"x":102,"y":362,"width":781,"height":11}},{"id":"49c25464-2456-4ca5-a546-179813b35b13","block_type":"box","text":"the company’s purpose and business model.","page_number":211,"box":{"x":68,"y":377,"width":320,"height":11}},{"id":"d979f1b7-dcfe-4a0d-95ad-366390d1b7ea","block_type":"box","text":"9","page_number":211,"box":{"x":390,"y":378,"width":4,"height":4}},{"id":"5baf09a1-5bff-4b18-a29f-4faa01623fb5","block_type":"box","text":"We look to companies proposing to change their corporate form to a","page_number":211,"box":{"x":399,"y":377,"width":487,"height":12}},{"id":"f456f648-fe0e-415f-87f2-7b9ba6677f1b","block_type":"box","text":"public benefit corporation, or similar entity, to put it to a shareholder vote if not already required to do so under","page_number":211,"box":{"x":70,"y":392,"width":791,"height":12}},{"id":"9c21b8ba-1bbf-440c-b059-e9e4f96d1c3d","block_type":"box","text":"applicable law. We appreciate when suppor ting documentation from companies or shareholders proposing to alter the","page_number":211,"box":{"x":69,"y":407,"width":839,"height":12}},{"id":"21e03d65-9764-4759-a370-ace17f0f1d06","block_type":"box","text":"corporate form clearly explains how the interests of shareholders and different stakeholders would be impacted as","page_number":211,"box":{"x":69,"y":423,"width":818,"height":11}},{"id":"8a3bf249-5366-4058-85c5-eddf14327e10","block_type":"box","text":"well as the accountability and voting mechanisms that would be available to shareholders. We generally suppor t","page_number":211,"box":{"x":68,"y":438,"width":800,"height":11}},{"id":"c5979491-c807-4eb3-86dd-701d9a939814","block_type":"box","text":"management proposals if our analysis indicates that shareholders’ financial interests are adequately protected.","page_number":211,"box":{"x":69,"y":453,"width":796,"height":11}},{"id":"c923bb61-c631-42a4-b5ed-f8e4c61274d8","block_type":"box","text":"Corporate form shareholder proposals are evaluated on a case-by-case basis.","page_number":211,"box":{"x":69,"y":468,"width":552,"height":11}},{"id":"953fa08a-3faa-4402-9c1c-968047ce1919","block_type":"box","text":"SHAREHOLDER PROPOSALS","page_number":211,"box":{"x":385,"y":498,"width":207,"height":9}},{"id":"6e63d5f8-093c-4f9d-b063-46cde28a3891","block_type":"box","text":"In most markets, shareholders can submit proposals to be voted on at a company’s shareholder meeting, as","page_number":211,"box":{"x":102,"y":521,"width":777,"height":11}},{"id":"b863ed29-4e0d-4618-966d-92b90962e70c","block_type":"box","text":"long as cer tain requirements are met. Shareholder proposals span a wide range of topics, including governance","page_number":211,"box":{"x":70,"y":536,"width":796,"height":11}},{"id":"8a564492-8521-40fd-8de6-3f420b9a24f3","block_type":"box","text":"reforms, capital management, and changes in the management or disclosure of sustainability-related risks. These","page_number":211,"box":{"x":69,"y":551,"width":813,"height":11}},{"id":"584743c0-1b2e-49fd-8a90-7db6b7ffbf5c","block_type":"box","text":"proposals have a varying degree of relevance for companies across sectors, locations, and business models.","page_number":211,"box":{"x":70,"y":566,"width":779,"height":11}},{"id":"8e669b93-e4d8-497a-81ce-995dc0ba59ee","block_type":"box","text":"BIS takes a case-by-case approach to voting on shareholder proposals and maintains a singular focus on the","page_number":211,"box":{"x":102,"y":589,"width":775,"height":11}},{"id":"8467d662-99f4-4c42-a2a9-30689065b9b0","block_type":"box","text":"proposal’s implications for long-term financial value creation for shareholders. Our analysis considers whether a","page_number":211,"box":{"x":70,"y":604,"width":796,"height":11}},{"id":"67b9a226-72f4-4284-9c67-1c9b4ec09861","block_type":"box","text":"shareholder proposal addresses a material risk that may impact a company’s long-term financial per formance. BIS","page_number":211,"box":{"x":69,"y":619,"width":818,"height":11}},{"id":"faa8fc15-4dee-4ba9-b54e-3be33b81a5c4","block_type":"box","text":"may suppor t shareholder proposals that request disclosures that help us, as long-term investors on behalf of our","page_number":211,"box":{"x":69,"y":634,"width":809,"height":12}},{"id":"d3986efc-fd86-44d0-94aa-17e0dafca418","block_type":"box","text":"clients, better understand the material risks and oppor tunities companies face and how they are managing them,","page_number":211,"box":{"x":69,"y":649,"width":807,"height":12}},{"id":"87225e86-6e9b-4566-b64a-e3f26dc0ad76","block_type":"box","text":"especially where this information is additive given the company’s existing disclosures. We look for consistency","page_number":211,"box":{"x":69,"y":664,"width":787,"height":12}},{"id":"948d6ff3-b29a-4aed-ae73-1bb14b7ab2d4","block_type":"box","text":"between the specific request formally made in the proposal, the suppor ting documentation, and the proponents’","page_number":211,"box":{"x":69,"y":680,"width":801,"height":11}},{"id":"d74585c7-a32c-45dd-9746-bbf42b796c15","block_type":"box","text":"other communications on the issues. We also assess the company’s practices and disclosures and the costs and","page_number":211,"box":{"x":69,"y":695,"width":813,"height":11}},{"id":"b337ff1c-8226-4732-a44e-db64ba0adafc","block_type":"box","text":"benefits to the company of meeting the request made in the proposal. We take into consideration a company’s","page_number":211,"box":{"x":69,"y":710,"width":791,"height":11}},{"id":"ba9ce02b-0e0e-458b-9464-dd509b0f531e","block_type":"box","text":"governance practices and disclosures against those of their peers.","page_number":211,"box":{"x":68,"y":725,"width":475,"height":11}},{"id":"89df6b50-ec89-46e5-94f6-2d2dde2a0682","block_type":"box","text":"BIS does not suppor t shareholder proposals that we view as inconsistent with long-term financial value or that","page_number":211,"box":{"x":102,"y":748,"width":787,"height":11}},{"id":"af36bb86-d5cb-499b-ab9c-134401a61eba","block_type":"box","text":"seek to micromanage companies. We take into consideration the legal effect of the proposal, as shareholder","page_number":211,"box":{"x":69,"y":763,"width":778,"height":11}},{"id":"aa9aa82c-4f71-4c88-b361-9ba763a4271e","block_type":"box","text":"proposals may be advisory or legally binding depending on the jurisdiction, while others may make requests that","page_number":211,"box":{"x":70,"y":778,"width":799,"height":11}},{"id":"5de2e71c-4a2b-4c99-a902-f5e6ef3b8ed6","block_type":"box","text":"would be deemed illegal in a given jurisdiction.","page_number":211,"box":{"x":68,"y":793,"width":331,"height":11}},{"id":"23625030-6f68-4239-91b8-02edb31d4083","block_type":"box","text":"In our experience, it is helpful when companies disclose the names of the proponent or organization that has","page_number":211,"box":{"x":102,"y":816,"width":777,"height":11}},{"id":"bfea6435-8c3f-4086-8dd8-16de3af4eb10","block_type":"box","text":"submitted or advised on the proposal. We recognize that some shareholder proposals bundle topics and/or specific","page_number":211,"box":{"x":69,"y":831,"width":825,"height":11}},{"id":"40f4e983-0224-4e54-abc6-984ca9d04c5a","block_type":"box","text":"requests. Fur ther, the proponent’s suppor ting statement may refer to topics that are not directly related to the","page_number":211,"box":{"x":69,"y":846,"width":788,"height":11}},{"id":"c45a24c5-da86-4b66-95fb-bd003b72debb","block_type":"box","text":"request made in the proposal. In voting on behalf of clients, we must vote yes or no on the proposal as phrased by","page_number":211,"box":{"x":69,"y":861,"width":820,"height":11}},{"id":"ce4db940-bb7a-464d-89c6-bc2376a3bec4","block_type":"box","text":"the proponent. Therefore, when we vote in suppor t of a proposal, we are not necessarily endorsing every element of","page_number":211,"box":{"x":68,"y":876,"width":831,"height":11}},{"id":"604677df-4b4c-4d2b-9fc0-065406719ccd","block_type":"box","text":"9","page_number":211,"box":{"x":69,"y":906,"width":4,"height":4}},{"id":"1e679b9f-e6b3-46c7-931a-93395c6ff853","block_type":"box","text":"Corporate form refers to the legal structure by which a business is organized.","page_number":211,"box":{"x":79,"y":905,"width":550,"height":12}},{"id":"77b9fd2c-7057-4d48-bbb8-c946f755cca1","block_type":"box","text":"BlackRock Investment Stewardship","page_number":211,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"09ed2204-3bf0-4a3a-b3aa-108cebb50234","block_type":"box","text":"Global Principles | 9","page_number":211,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"a7d7d20e-7acd-4e05-86f5-21b04ec12b60","block_type":"box","text":"NM1026U-5982568-211/232","page_number":211,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"de3b6b72-4671-472b-83bb-90c06e658a46","block_type":"box","text":"the proposal or the reasoning, objectives, or suppor ting statement of the proponent. We may suppor t a proposal for","page_number":212,"box":{"x":68,"y":45,"width":829,"height":11}},{"id":"98b262a8-e61c-42f8-9b47-d8087dab6820","block_type":"box","text":"different reasons than those put for th by the proponent, when we believe that overall it may advance our clients’","page_number":212,"box":{"x":69,"y":60,"width":802,"height":11}},{"id":"eeb6439f-7966-4e77-b7c2-50d9b5ce14ff","block_type":"box","text":"long-term financial interests.","page_number":212,"box":{"x":70,"y":75,"width":201,"height":11}},{"id":"9203621f-e8c6-4187-ad7b-b67a2ccd948a","block_type":"box","text":"BlackRock is subject to cer tain rules, regulations, agency guidance, and contractual agreements that place","page_number":212,"box":{"x":102,"y":98,"width":763,"height":11}},{"id":"405a314d-0429-43fa-b394-4817d56c8aa0","block_type":"box","text":"restrictions and limitations on how BlackRock can interact with the companies in which we invest on behalf of our","page_number":212,"box":{"x":69,"y":113,"width":809,"height":11}},{"id":"00db6c41-1075-4f7f-820e-bb2dd4a67830","block_type":"box","text":"clients. BlackRock does not nominate directors for board elections or submit shareholder proposals to companies.","page_number":212,"box":{"x":69,"y":128,"width":817,"height":11}},{"id":"d270067f-3544-4add-8d47-f18e141c2bc7","block_type":"box","text":"Non-compliance with these requirements could adversely affect BlackRock’s ability to serve its clients’ interests.","page_number":212,"box":{"x":70,"y":143,"width":803,"height":11}},{"id":"c45eb0a1-2caf-4e08-8fb9-c2e0853cc7c3","block_type":"box","text":"MATERIAL SUSTAINABILITY-RELATED RISKS AND OPPORTUNITIES","page_number":212,"box":{"x":247,"y":173,"width":484,"height":9}},{"id":"1e223a0f-d206-4d97-9738-629ccf193fa7","block_type":"box","text":"Appropriate oversight of material risks and oppor tunities, including material sustainability-related risks and","page_number":212,"box":{"x":101,"y":196,"width":760,"height":11}},{"id":"aaf8f16b-e3e5-4d12-828d-f8ec24094afc","block_type":"box","text":"oppor tunities, is an impor tant component of having an effective governance framework that suppor ts durable, long","page_number":212,"box":{"x":69,"y":211,"width":824,"height":11}},{"id":"12711b8e-ca3f-4e91-aa12-9ba0c81a0df4","block_type":"box","text":"term financial value creation.","page_number":212,"box":{"x":68,"y":226,"width":206,"height":9}},{"id":"00b6b5c8-e784-4c02-b2f0-6f7c3c0ba3ad","block_type":"box","text":"10","page_number":212,"box":{"x":276,"y":226,"width":9,"height":5}},{"id":"bfc0a9ce-b7d0-4d80-b256-cd8c1883b5f8","block_type":"box","text":"We look to companies to provide robust disclosure that allows investors to effectively evaluate companies’","page_number":212,"box":{"x":101,"y":249,"width":761,"height":11}},{"id":"896eede4-318d-4274-bc9c-5209e69c3849","block_type":"box","text":"strategy and business practices related to material sustainability-related risks and oppor tunities. We find it helpful","page_number":212,"box":{"x":69,"y":264,"width":814,"height":11}},{"id":"6d4aba77-9cff-4f86-bea2-dc4366e676fd","block_type":"box","text":"when companies’ disclosures demonstrate that they have a resilient business model that integrates material","page_number":212,"box":{"x":68,"y":279,"width":777,"height":11}},{"id":"78f5233f-bd99-4a9f-b274-189df4625a86","block_type":"box","text":"sustainability-related risks and oppor tunities into their strategy, risk management, and metrics and targets, including","page_number":212,"box":{"x":69,"y":294,"width":833,"height":11}},{"id":"0b413ee7-f243-4cfa-9bc7-f09e45d5f878","block_type":"box","text":"industry-specific metrics.","page_number":212,"box":{"x":70,"y":309,"width":175,"height":11}},{"id":"cd307dfa-aec9-4727-86ad-97788f704232","block_type":"box","text":"Standardized disclosure of sustainability-related data suppor ts investors in making informed decisions. The","page_number":212,"box":{"x":102,"y":332,"width":765,"height":11}},{"id":"4a4c7b34-43a8-491d-891e-d4f159aae6e4","block_type":"box","text":"International Sustainability Standards Board (ISSB) standards, IFRS S1 and S2, represent one such approach to","page_number":212,"box":{"x":70,"y":347,"width":800,"height":11}},{"id":"c5d10408-0c1d-4f22-af7d-e26e7ad92f38","block_type":"box","text":"standardization that we find useful in our analysis.","page_number":212,"box":{"x":69,"y":362,"width":358,"height":11}},{"id":"9041d05c-d356-4b5a-b335-b0430fe12f59","block_type":"box","text":"11","page_number":212,"box":{"x":429,"y":363,"width":9,"height":4}},{"id":"b0e29207-035e-4ac4-ae8d-90a0979e7722","block_type":"box","text":"However, we do not mandate any specific disclosure framework","page_number":212,"box":{"x":444,"y":362,"width":451,"height":11}},{"id":"1c6eb646-c99c-446c-84e7-3f8f6e581127","block_type":"box","text":"companies should use, and recognize that companies may repor t using different standards, some of which may be","page_number":212,"box":{"x":69,"y":377,"width":821,"height":12}},{"id":"01a6f4dc-674c-4c6b-b6b4-2649673be399","block_type":"box","text":"required by regulation. In such cases, we ask that companies highlight the metrics that are industry- or company","page_number":212,"box":{"x":69,"y":393,"width":806,"height":11}},{"id":"7f943188-20fb-41bd-a8bf-888d9673d962","block_type":"box","text":"specific.","page_number":212,"box":{"x":69,"y":407,"width":57,"height":11}},{"id":"293470fc-4160-49cc-aa1a-70a574181f29","block_type":"box","text":"We also recognize that companies may be phasing in repor ting over several years. We do not prescribe timelines","page_number":212,"box":{"x":101,"y":430,"width":805,"height":11}},{"id":"ac89f6af-d1ba-48ff-9cc9-96312f4e960d","block_type":"box","text":"regarding when companies should make sustainability-related disclosures but appreciate it when companies produce","page_number":212,"box":{"x":69,"y":446,"width":833,"height":11}},{"id":"3c03da80-56ac-4f9f-921f-584b2570b628","block_type":"box","text":"them sufficiently in advance of their shareholder meeting, to the best of their abilities, to provide investors with time","page_number":212,"box":{"x":68,"y":460,"width":830,"height":12}},{"id":"78605a1b-bd41-4861-ba6c-5c6d133832c5","block_type":"box","text":"to assess the data and make informed voting decisions.","page_number":212,"box":{"x":68,"y":475,"width":401,"height":12}},{"id":"0e96f222-a687-4e70-bc1d-c23fec7a82ae","block_type":"box","text":"Industry initiatives on managing specific operational risks may also provide useful guidance to companies on","page_number":212,"box":{"x":102,"y":498,"width":775,"height":11}},{"id":"de31ffae-d6e6-4749-83be-83b8f41c1af9","block_type":"box","text":"best practices and disclosures. While not a voting item, we find it helpful to our understanding of investment risk","page_number":212,"box":{"x":69,"y":513,"width":804,"height":12}},{"id":"6325ec39-4351-4c30-aeb4-58608fe2916e","block_type":"box","text":"when companies disclose any relevant global sustainability-related standards adopted, the industry initiatives in","page_number":212,"box":{"x":68,"y":529,"width":799,"height":11}},{"id":"0522bbcd-feaa-4e28-b7f5-caa8c61dae59","block_type":"box","text":"which they par ticipate, any peer group benchmarking under taken, and any assurance processes to help investors","page_number":212,"box":{"x":68,"y":544,"width":810,"height":11}},{"id":"d5b0c183-e26c-40bd-a7bc-8126ec57c3d9","block_type":"box","text":"understand their approach to sustainable and responsible business practices.","page_number":212,"box":{"x":69,"y":559,"width":556,"height":11}},{"id":"6ed74a2d-9482-438a-b757-23dc85cb16c6","block_type":"box","text":"10","page_number":212,"box":{"x":69,"y":603,"width":9,"height":5}},{"id":"e749adf4-1eea-4b5c-a437-e9b693e7fd67","block_type":"box","text":"By material sustainability-related risks and oppor tunities, we mean the drivers of risk and financial value creation in","page_number":212,"box":{"x":84,"y":603,"width":822,"height":11}},{"id":"030dbe70-38e3-484a-94ad-916cd1013e86","block_type":"box","text":"a company’s business model that have an environmental or social dependency or impact. Examples of environmental","page_number":212,"box":{"x":69,"y":618,"width":835,"height":11}},{"id":"09ed9905-ead3-455b-9dd8-2f07ba59f5a7","block_type":"box","text":"issues include, but are not limited to, water use, land use, waste management, and climate risk. Examples of social","page_number":212,"box":{"x":70,"y":633,"width":827,"height":12}},{"id":"6bbf46ab-a1da-49cf-bb94-8765bfc2053a","block_type":"box","text":"issues include, but are not limited to, human capital management, impacts on the communities in which a company","page_number":212,"box":{"x":70,"y":649,"width":826,"height":11}},{"id":"63692a00-4289-423e-b483-e240829177d4","block_type":"box","text":"operates, customer loyalty, and relationships with regulators.","page_number":212,"box":{"x":69,"y":664,"width":433,"height":11}},{"id":"cfed2675-b674-425a-ad22-8629b1b2b9dc","block_type":"box","text":"11","page_number":212,"box":{"x":69,"y":682,"width":9,"height":4}},{"id":"0c3a3eca-d20b-4ada-aca7-1454b2b89086","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Repor ting Standards","page_number":212,"box":{"x":83,"y":681,"width":744,"height":11}},{"id":"c389e466-45af-4e48-a826-e971d5e574c1","block_type":"box","text":"(IFRS) Foundation. The standards build on the Task Force on Climate-related Financial Disclosures (TCFD) framework","page_number":212,"box":{"x":69,"y":696,"width":828,"height":11}},{"id":"5a695262-9fb7-4f7b-96c2-1a6404ea9477","block_type":"box","text":"and the standards and metrics developed by the Sustainability Accounting Standards Board (SASB), which have both","page_number":212,"box":{"x":69,"y":711,"width":830,"height":12}},{"id":"34f962e5-c7ea-42b3-b839-6e537f5046ef","block_type":"box","text":"converged under the ISSB. Please refer to the IFRS website to learn more about the framework and standards S1","page_number":212,"box":{"x":69,"y":726,"width":809,"height":12}},{"id":"54261129-5627-47ef-9189-d09bf6e6a38a","block_type":"box","text":"“General Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related","page_number":212,"box":{"x":70,"y":742,"width":778,"height":11}},{"id":"2075c410-e838-494a-bf1c-4c05780806a8","block_type":"box","text":"Disclosures.” Websites accessed in December 2025.","page_number":212,"box":{"x":70,"y":757,"width":380,"height":9}},{"id":"4936368a-2b42-4369-8dc4-b6d1ed98f14e","block_type":"box","text":"BlackRock Investment Stewardship","page_number":212,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"0845c628-3e53-4b2f-8f10-16ea6f4b3e98","block_type":"box","text":"Global Principles | 10","page_number":212,"box":{"x":758,"y":942,"width":151,"height":13}},{"id":"c3c674d8-aa8f-4938-b583-d4ae16e854fe","block_type":"box","text":"NM1026U-5982568-212/232","page_number":212,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"56d75488-856a-46f2-8756-16b569b189cd","block_type":"box","text":"CLIMATE AND NATURE-RELATED RISK","page_number":213,"box":{"x":351,"y":45,"width":277,"height":9}},{"id":"5315b1e9-8e32-4bf8-a980-aedd2223edbf","block_type":"box","text":"Many companies are assessing how to navigate the low-carbon transition while delivering long-term financial","page_number":213,"box":{"x":102,"y":67,"width":769,"height":12}},{"id":"c13f9af0-bc40-4d7a-a23e-04bdd2f1c805","block_type":"box","text":"value to investors. For companies facing material climate-related risks, we find it helpful when they publicly disclose,","page_number":213,"box":{"x":68,"y":82,"width":829,"height":12}},{"id":"629004b9-c5cf-4604-b8d5-ebd6ad2c62b7","block_type":"box","text":"consistent with their business model and sector, how they intend to deliver long-term financial per formance through","page_number":213,"box":{"x":69,"y":98,"width":824,"height":11}},{"id":"808604d2-95cc-4bb5-b386-487af122f629","block_type":"box","text":"the low-carbon transition, including where available, their transition plan.","page_number":213,"box":{"x":68,"y":113,"width":514,"height":11}},{"id":"35c503ef-3b0b-4f46-a608-28c18d48672d","block_type":"box","text":"12, 13","page_number":213,"box":{"x":584,"y":113,"width":26,"height":5}},{"id":"f7851ae2-9a76-434a-b1ec-ce80541d2f0e","block_type":"box","text":"From company disclosures and","page_number":213,"box":{"x":617,"y":113,"width":218,"height":11}},{"id":"bd38d7e8-83e5-40e9-adf8-d70089ca949e","block_type":"box","text":"engagement, we seek to understand the strategies companies have in place to manage material risks to, and","page_number":213,"box":{"x":69,"y":128,"width":782,"height":11}},{"id":"3a1acc3a-af80-4ccb-a637-8f37911fcc59","block_type":"box","text":"oppor tunities for, their long-term business model associated with a range of climate-related scenarios.","page_number":213,"box":{"x":69,"y":143,"width":729,"height":11}},{"id":"d9bef3c7-a1f6-4f31-a50d-38a2494bc2d5","block_type":"box","text":"Recognizing the value of these disclosures, cer tain markets such as the European Union mandate large","page_number":213,"box":{"x":102,"y":166,"width":740,"height":11}},{"id":"a545ecad-3dc4-4c23-ae43-306cd32a256b","block_type":"box","text":"companies to disclose such climate-related financial information, while in other jurisdictions these disclosures are","page_number":213,"box":{"x":69,"y":181,"width":814,"height":11}},{"id":"c90afbef-5cac-4387-9cec-253fbc6691f8","block_type":"box","text":"viewed as best practice in the market.","page_number":213,"box":{"x":68,"y":196,"width":271,"height":11}},{"id":"ba90ee48-396e-4221-9833-4f77047a7d9d","block_type":"box","text":"The ISSB standards provide one such framework that can assist investors in assessing company-specific","page_number":213,"box":{"x":101,"y":218,"width":749,"height":12}},{"id":"ca6b5486-873e-4e48-93eb-62ef83a9b5b8","block_type":"box","text":"climate-related risks and oppor tunities, and informing investment decisions. Such disclosures also provide investors","page_number":213,"box":{"x":69,"y":234,"width":831,"height":11}},{"id":"468a2d07-682f-47cc-a332-91a1587481d2","block_type":"box","text":"with insights into how companies are managing the risks associated with a transition to a low-carbon economy by","page_number":213,"box":{"x":68,"y":249,"width":809,"height":11}},{"id":"de361eac-a10a-4d73-bf66-24c9b3dd0ccd","block_type":"box","text":"managing their own carbon emissions or emissions intensities to the extent financially practicable.","page_number":213,"box":{"x":69,"y":264,"width":702,"height":11}},{"id":"a1ec61cb-26a9-421a-b9e5-bc6825055560","block_type":"box","text":"The ISSB standards, for example, contemplate disclosures on how companies are setting shor t-, medium- and","page_number":213,"box":{"x":101,"y":286,"width":786,"height":12}},{"id":"2c45eab4-d60a-41e5-8c1e-66ede7c11b2d","block_type":"box","text":"long-term targets, ideally science-based where these are available for their sector, for scope 1 and 2 greenhouse gas","page_number":213,"box":{"x":70,"y":302,"width":834,"height":11}},{"id":"62aa558d-f5af-470c-9f3b-694914891185","block_type":"box","text":"emissions (GHG) reductions and to demonstrate how their targets are consistent with the long-term financial","page_number":213,"box":{"x":69,"y":317,"width":773,"height":11}},{"id":"10783400-1ae3-4b95-9874-c8332029a805","block_type":"box","text":"interests of their investors.","page_number":213,"box":{"x":70,"y":332,"width":190,"height":9}},{"id":"05cba768-9acc-4621-a9ec-213c6b78260f","block_type":"box","text":"While we recognize that regulators in some markets are moving to mandate cer tain disclosures, at this stage,","page_number":213,"box":{"x":101,"y":355,"width":784,"height":11}},{"id":"d4d54664-3c5e-429c-8864-7fbbe23dca88","block_type":"box","text":"we view scope 3 emissions differently from scopes 1 and 2, given methodological complexity, regulatory uncer tainty,","page_number":213,"box":{"x":68,"y":370,"width":832,"height":11}},{"id":"77565850-5d9d-45a6-86a2-e42ffc070b4a","block_type":"box","text":"concerns about double-counting, and lack of direct control by companies. We welcome disclosures and commitments","page_number":213,"box":{"x":69,"y":385,"width":834,"height":11}},{"id":"96993fe2-2dc0-4436-a4d9-468d8e2a2dc9","block_type":"box","text":"that companies choose to make regarding material scope 3 emissions and recognize that these are provided on a","page_number":213,"box":{"x":68,"y":400,"width":815,"height":11}},{"id":"6c3c2a4e-6043-4ce2-b874-b586bd8eb401","block_type":"box","text":"good-faith basis as methodology develops.","page_number":213,"box":{"x":68,"y":415,"width":303,"height":11}},{"id":"cf880773-0f05-4fb8-a115-66d8a1b54b8a","block_type":"box","text":"In addition to climate-related risks and oppor tunities, for companies whose strategies, operations or supply","page_number":213,"box":{"x":102,"y":438,"width":766,"height":11}},{"id":"ca274f7f-04be-4021-96cb-82f7fafdd3b1","block_type":"box","text":"chains are materially reliant on natural capital, nature-related risks and oppor tunities may affect their ability to","page_number":213,"box":{"x":69,"y":453,"width":788,"height":11}},{"id":"b4e628ea-00a2-48ec-b34f-0f6d41fda0fb","block_type":"box","text":"generate long-term financial returns.","page_number":213,"box":{"x":68,"y":468,"width":258,"height":11}},{"id":"39975fd2-cfe8-4b8b-84be-f96b0a2901ad","block_type":"box","text":"14","page_number":213,"box":{"x":328,"y":468,"width":9,"height":5}},{"id":"70a0af77-a869-4319-b491-66ef2dadf3fc","block_type":"box","text":"For these companies, we rely on disclosures to understand how their","page_number":213,"box":{"x":344,"y":468,"width":490,"height":11}},{"id":"9d792985-034f-41ce-be1e-8be4410e94ee","block_type":"box","text":"strategies consider nature-related impacts and dependencies and to assess how the board oversees these risks.","page_number":213,"box":{"x":69,"y":483,"width":807,"height":11}},{"id":"c3ed0fc4-7009-4b28-bbc2-2950001196da","block_type":"box","text":"15","page_number":213,"box":{"x":878,"y":484,"width":9,"height":4}},{"id":"1ccd3a76-8e0c-4fb0-ab02-3bd2502776f3","block_type":"box","text":"COMPANIES’ IMPACT ON THEIR WORKFORCE, SUPPLY CHAINS, AND COMMUNITIES","page_number":213,"box":{"x":179,"y":513,"width":620,"height":11}},{"id":"7cb07289-a5c8-415f-82ee-1cad5092ab26","block_type":"box","text":"Companies determine their key stakeholders based on what is material to their business and long-term financial","page_number":213,"box":{"x":102,"y":536,"width":799,"height":11}},{"id":"f3f27895-e160-480d-be84-d19645b281eb","block_type":"box","text":"per formance. For many companies, key stakeholders include employees, business supply chains, clients and","page_number":213,"box":{"x":70,"y":551,"width":778,"height":11}},{"id":"2e28cef4-f8b1-4f25-9a50-8fa388aacc31","block_type":"box","text":"consumers, regulators, and the communities in which they operate.","page_number":213,"box":{"x":69,"y":566,"width":479,"height":11}},{"id":"1b0b3931-afd3-479b-963a-fa892e615afa","block_type":"box","text":"In our experience, companies that invest in the relationships that are critical to their strategic objectives are","page_number":213,"box":{"x":102,"y":589,"width":770,"height":11}},{"id":"a32224e6-3a6f-450b-9374-f717e0eeba28","block_type":"box","text":"more likely to deliver durable, long-term financial per formance. By contrast, we have found that poor relationships","page_number":213,"box":{"x":69,"y":604,"width":810,"height":11}},{"id":"091d1048-2a8d-4b30-bb29-7ffde8b764ba","block_type":"box","text":"12","page_number":213,"box":{"x":69,"y":634,"width":9,"height":4}},{"id":"3a371846-2ef6-4f77-9314-dc559921c145","block_type":"box","text":"We have observed that more companies are developing such plans, and public policymakers in cer tain markets are","page_number":213,"box":{"x":83,"y":633,"width":823,"height":12}},{"id":"e9ea864d-efd5-4fe4-97fe-b302cbd7d55b","block_type":"box","text":"signaling their intentions to require them or already have requirements in place, such as Australia, Brazil, and the","page_number":213,"box":{"x":69,"y":649,"width":808,"height":11}},{"id":"1f832451-72cd-43c2-82da-cd84319e4506","block_type":"box","text":"European Union (please see the International Transition Plan Network for information). We view transition plans as a","page_number":213,"box":{"x":70,"y":663,"width":827,"height":11}},{"id":"7671adc6-fc61-4c0e-b4b2-ea6a1c7c6044","block_type":"box","text":"method for a company to both internally assess and externally communicate its long-term strategy, ambition,","page_number":213,"box":{"x":69,"y":679,"width":774,"height":11}},{"id":"549f4f06-c478-4d15-9860-361cefe2aa0c","block_type":"box","text":"objectives, and actions to create financial value through the global transition towards a low-carbon economy. Across","page_number":213,"box":{"x":69,"y":694,"width":825,"height":11}},{"id":"a5772d63-55e2-41ca-9104-ecbd0343c495","block_type":"box","text":"the landscape there remains divergence on the objectives of such plans and the details they should contain. While","page_number":213,"box":{"x":68,"y":709,"width":819,"height":11}},{"id":"de21b275-643b-47a3-b639-a57e5c2085c6","block_type":"box","text":"transition plans can be helpful disclosure, BIS does not make the preparation and production of transition plans a","page_number":213,"box":{"x":68,"y":724,"width":813,"height":11}},{"id":"efb7fbfb-297b-49bd-9b53-980faa0b5bd8","block_type":"box","text":"voting issue. BIS may engage companies that have chosen to publish a transition plan to understand their planned","page_number":213,"box":{"x":68,"y":739,"width":819,"height":11}},{"id":"ba2beb01-3f9e-4843-9a18-62f09596919c","block_type":"box","text":"actions and resource implications. Website accessed in December 2025.","page_number":213,"box":{"x":69,"y":754,"width":522,"height":11}},{"id":"8e15b657-1f8b-4938-b336-8fb17c73d547","block_type":"box","text":"13","page_number":213,"box":{"x":69,"y":772,"width":9,"height":5}},{"id":"fce7fc75-b7aa-4f13-b5a5-391e93184ecd","block_type":"box","text":"For more information, please see our commentary “Climate-related risks and a low-carbon transition,” December","page_number":213,"box":{"x":84,"y":772,"width":804,"height":11}},{"id":"b364c155-dded-4a38-99bf-a7197eeeb7b7","block_type":"box","text":"2025.","page_number":213,"box":{"x":69,"y":787,"width":42,"height":9}},{"id":"325c4dcb-839c-4d01-bffa-bdbb4118ddfd","block_type":"box","text":"14","page_number":213,"box":{"x":69,"y":805,"width":9,"height":4}},{"id":"3e79798a-ec78-4ea0-b8a0-acd1a37709fb","block_type":"box","text":"For more information, please see our commentary “Our approach to engagement on natural capital,” December","page_number":213,"box":{"x":84,"y":805,"width":796,"height":11}},{"id":"24dee713-3fbe-4b5b-9eed-d54bc5ac88d8","block_type":"box","text":"2025.","page_number":213,"box":{"x":69,"y":820,"width":42,"height":9}},{"id":"307b8706-8bf5-43c4-804a-5f8b6cb76aab","block_type":"box","text":"15","page_number":213,"box":{"x":69,"y":838,"width":9,"height":4}},{"id":"1c2903ba-4110-4320-aafc-9a07403c3acf","block_type":"box","text":"Given the growing awareness of the materiality of these issues for cer tain businesses, enhanced repor ting on a","page_number":213,"box":{"x":84,"y":837,"width":797,"height":12}},{"id":"aca430df-6894-4ae6-97b0-8fc6b5809005","block_type":"box","text":"company’s natural capital dependencies and impacts would aid investors’ understanding. The recommendations of","page_number":213,"box":{"x":69,"y":852,"width":820,"height":12}},{"id":"8b2e7489-79f1-4b31-8c47-d20156b19bfd","block_type":"box","text":"the Taskforce on Nature-related Financial Disclosures (TNFD) may prove useful to some companies. We recognize that","page_number":213,"box":{"x":68,"y":868,"width":842,"height":11}},{"id":"c9bb6988-534b-4c20-9aaf-27aa2ba1dfd3","block_type":"box","text":"some companies may repor t using different standards, which may be required by regulation, or one of a number of","page_number":213,"box":{"x":69,"y":883,"width":820,"height":11}},{"id":"6dcccc30-ff01-4aa8-a675-5d58edd7807d","block_type":"box","text":"other private sector standards. TNFD-aligned repor ting is not a voting issue. Website accessed in December 2025.","page_number":213,"box":{"x":69,"y":898,"width":817,"height":11}},{"id":"4559c037-9324-460b-9474-6a4c3f7d6d27","block_type":"box","text":"BlackRock Investment Stewardship","page_number":213,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"74e62604-b2e0-4b47-8dbe-28db145db43d","block_type":"box","text":"Global Principles | 11","page_number":213,"box":{"x":758,"y":942,"width":151,"height":13}},{"id":"5993e098-a3eb-4838-b48a-a9d46f282bd0","block_type":"box","text":"NM1026U-5982568-213/232","page_number":213,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"19e2ae6e-1f0f-41b6-b183-b31b95bbb0dc","block_type":"box","text":"may create adverse impacts that could expose companies to legal, regulatory, operational, and reputational risks.","page_number":214,"box":{"x":69,"y":45,"width":811,"height":11}},{"id":"1cda5652-63e4-4a88-a41b-125219a6f539","block_type":"box","text":"This is par ticularly relevant to a company’s workforce, which is central to long-term financial value creation.","page_number":214,"box":{"x":68,"y":60,"width":764,"height":11}},{"id":"71df306c-a7cc-44ff-8745-ea8098ca1cb3","block_type":"box","text":"16","page_number":214,"box":{"x":834,"y":60,"width":9,"height":5}},{"id":"276333c4-8d7d-4562-952e-ecae09e46e57","block_type":"box","text":"As a long-term shareholder on behalf of our clients, we find it helpful when companies disclose how they have","page_number":214,"box":{"x":101,"y":82,"width":783,"height":12}},{"id":"ea5acfd5-243f-4147-ab6d-1a5bdb63c6b2","block_type":"box","text":"identified their key stakeholders and considered their interests in business decision-making. In addition to","page_number":214,"box":{"x":70,"y":98,"width":755,"height":11}},{"id":"26cb67d8-cac2-45a4-b3c3-98eb248bb60d","block_type":"box","text":"understanding broader stakeholder relationships, BIS finds it helpful when companies discuss how they consider the","page_number":214,"box":{"x":69,"y":113,"width":831,"height":11}},{"id":"705c019f-90a9-4786-822e-49d8bccfdc84","block_type":"box","text":"needs of their workforce today, and the skills required for their future business strategy. We are also interested in","page_number":214,"box":{"x":69,"y":128,"width":809,"height":11}},{"id":"7f0296c9-62ae-4542-80a8-a7aec5af1c0b","block_type":"box","text":"understanding how the board monitors and engages on these matters, given it is well positioned to ensure that the","page_number":214,"box":{"x":69,"y":143,"width":821,"height":11}},{"id":"ece229d3-095b-4363-9ae7-5589313cd9ca","block_type":"box","text":"approach taken by management is informed by and aligns with the company’s strategy. BIS does not direct a","page_number":214,"box":{"x":69,"y":158,"width":775,"height":11}},{"id":"931f4ef5-a8a5-4d86-8ce7-0efeb19c3db6","block_type":"box","text":"company’s policies or practices, which are the responsibility of management and the board.","page_number":214,"box":{"x":69,"y":173,"width":653,"height":11}},{"id":"efb83e32-f55b-4020-9710-c1dcc47a1f65","block_type":"box","text":"In addition, we find it helpful when companies disclose their approach to addressing material adverse impacts","page_number":214,"box":{"x":102,"y":196,"width":784,"height":11}},{"id":"97882d04-7708-41d6-a29d-95db820d118f","block_type":"box","text":"that could arise from their business practices and affect critical relationships with their stakeholders. We encourage","page_number":214,"box":{"x":68,"y":211,"width":829,"height":11}},{"id":"7f2ac188-910c-40c5-bf5d-515c5fa338b1","block_type":"box","text":"companies to implement, to the extent appropriate, monitoring processes (often referred to as due diligence) to","page_number":214,"box":{"x":69,"y":226,"width":797,"height":11}},{"id":"f8297965-e102-4db7-bd82-516b5fd99ae3","block_type":"box","text":"identify and mitigate potential adverse impacts and grievance mechanisms to remediate any actual adverse material","page_number":214,"box":{"x":70,"y":241,"width":828,"height":11}},{"id":"342464a7-eecb-4e3d-87c1-023e2f8afc0c","block_type":"box","text":"impacts.","page_number":214,"box":{"x":70,"y":257,"width":58,"height":10}},{"id":"dfa09274-c2d8-45f8-a501-bcba39649390","block_type":"box","text":"We look to boards to oversee management’s approach to addressing material risks related to key stakeholders","page_number":214,"box":{"x":101,"y":279,"width":794,"height":11}},{"id":"223c437c-57ee-43ac-a6db-daf8d8bc5fd5","block_type":"box","text":"and may convey concerns about board oversight in our voting on director elections or suppor ting a business relevant","page_number":214,"box":{"x":69,"y":294,"width":831,"height":11}},{"id":"4cdbfd3f-4b17-4808-b74d-30c72f9b3210","block_type":"box","text":"shareholder proposal when, in our assessment, the board is not acting in shareholders’ long-term financial interests.","page_number":214,"box":{"x":69,"y":309,"width":834,"height":11}},{"id":"07f28205-32c2-48d5-b8d4-e3c019c5ef2e","block_type":"box","text":"BLACKROCK’S OVERSIGHT OF ITS INVESTMENT STEWARDSHIP ACTIVITIES","page_number":214,"box":{"x":213,"y":340,"width":553,"height":8}},{"id":"930dc9a0-deea-4e01-9c4e-0881903c42c4","block_type":"box","text":"BIS’ governance structure suppor ts oversight and accountability of stewardship-related activities on behalf of","page_number":214,"box":{"x":102,"y":362,"width":778,"height":11}},{"id":"8e5c896a-df57-4619-b635-d43933f667d8","block_type":"box","text":"clients at the global and regional level.","page_number":214,"box":{"x":69,"y":377,"width":274,"height":12}},{"id":"965cde0b-2a67-4bd5-9773-001058e00cde","block_type":"box","text":"At the top of this governance structure, the risk-focused BIS Global Oversight Committee (the Committee)","page_number":214,"box":{"x":101,"y":400,"width":751,"height":11}},{"id":"3946d136-4766-45c1-b53a-b7b1d5760df8","block_type":"box","text":"suppor ts BIS’ regulatory responsibilities in relation to proxy voting, including adherence to policies and procedures as","page_number":214,"box":{"x":69,"y":415,"width":840,"height":11}},{"id":"56b37524-3677-4ed9-abab-69fa9165654d","block_type":"box","text":"well as market-level stewardship requirements. The Committee reviews and approves amendments to the Global","page_number":214,"box":{"x":68,"y":430,"width":802,"height":11}},{"id":"f3279324-c87f-4acb-a60b-2712db4289b7","block_type":"box","text":"Principles and regional voting guidelines. The Committee also reviews periodic repor ts regarding the votes cast by","page_number":214,"box":{"x":69,"y":445,"width":813,"height":12}},{"id":"5c0b3a17-d21e-44db-83f0-f9011145927b","block_type":"box","text":"BIS on behalf of clients, as well as updates on material process issues, procedural changes, and other risk oversight","page_number":214,"box":{"x":70,"y":460,"width":835,"height":12}},{"id":"e158610d-7f8f-4e7e-b8ee-57564bc90500","block_type":"box","text":"considerations. The Committee is chaired by the Global Heads of the Investment Stewardship function and its","page_number":214,"box":{"x":69,"y":475,"width":783,"height":12}},{"id":"d7356ceb-006e-497a-bac4-c9bbc714e6a1","block_type":"box","text":"members include senior BlackRock executives with legal, risk, and other experience relevant to team oversight who","page_number":214,"box":{"x":69,"y":491,"width":820,"height":11}},{"id":"5d5efdc6-cdc6-40a4-8004-6d20724c0482","block_type":"box","text":"are independent from the investment stewardship function.","page_number":214,"box":{"x":69,"y":506,"width":421,"height":11}},{"id":"b0e471e8-cbe3-4c08-8e13-a75f0f7363b5","block_type":"box","text":"The Global Heads have primary oversight of BIS’ activities globally, including voting in accordance with the Global","page_number":214,"box":{"x":101,"y":528,"width":804,"height":12}},{"id":"6300a16b-36ce-4120-bb12-8e48e9771e5f","block_type":"box","text":"Principles and regional voting guidelines. At the regional level, three regional Heads for the Americas, APAC, and","page_number":214,"box":{"x":69,"y":543,"width":798,"height":12}},{"id":"5d8ff372-4216-40c8-928e-0e5ed42cec3e","block_type":"box","text":"EMEA oversee BIS’ activities for their specific markets.","page_number":214,"box":{"x":70,"y":559,"width":389,"height":11}},{"id":"0a703698-d3fd-476d-9921-8fcf37e579bd","block_type":"box","text":"VOTE EXECUTION","page_number":214,"box":{"x":424,"y":589,"width":129,"height":9}},{"id":"5981a948-ecd7-4aa5-ba20-87bec81d7cd4","block_type":"box","text":"BIS votes proxies on behalf of index equity funds and accounts when authorized by our clients. We have","page_number":214,"box":{"x":102,"y":612,"width":739,"height":11}},{"id":"b7def636-dfcf-47d4-8102-0ae7d4a6b4dd","block_type":"box","text":"processes in place to consider all proxies for which we have voting authority, and submit voting decisions, or refrain","page_number":214,"box":{"x":70,"y":627,"width":822,"height":11}},{"id":"778ee673-ecf6-4919-91c0-c0f34372c2d1","block_type":"box","text":"from voting when logistical issues arise (see below). The BIS Benchmark Policies – and the vote decisions made","page_number":214,"box":{"x":68,"y":642,"width":801,"height":11}},{"id":"4f4b88c0-15a5-4903-9679-19c33f1c196a","block_type":"box","text":"consistent with those policies – reflect our reasonable and independent judgment and are made without regard to the","page_number":214,"box":{"x":69,"y":657,"width":838,"height":11}},{"id":"c4b44c85-27c8-4e3f-afbe-45db21fe5d51","block_type":"box","text":"relationship between the issuer of the proxy (or any shareholder proponent or dissident shareholder) and the Fund,","page_number":214,"box":{"x":69,"y":672,"width":817,"height":11}},{"id":"4fd5370d-2d1a-4828-9fed-ee3119f8fad8","block_type":"box","text":"the Fund’s affiliates (if any), BlackRock or BlackRock’s affiliates, or BlackRock employees (see “Conflicts","page_number":214,"box":{"x":68,"y":687,"width":751,"height":11}},{"id":"07a5d9f3-c264-4924-adc6-d137f1f15398","block_type":"box","text":"management policies and procedures,” below).","page_number":214,"box":{"x":69,"y":703,"width":334,"height":11}},{"id":"08ff57d4-9f5d-4dee-b6f1-e3ec48f6f904","block_type":"box","text":"In cer tain markets, proxy voting involves logistical issues which can affect BIS’ ability to vote, as well as the cost","page_number":214,"box":{"x":102,"y":725,"width":806,"height":11}},{"id":"423cd24b-9350-4aec-bd9d-d1272f863633","block_type":"box","text":"of voting such proxies on behalf of our clients. These issues include, but are not limited to: 1) untimely notice of","page_number":214,"box":{"x":69,"y":740,"width":801,"height":11}},{"id":"9bc7e765-127c-43a0-8e0b-303854db851e","block_type":"box","text":"shareholder meetings; 2) restrictions on a foreigner’s ability to exercise votes; 3) requirements to vote proxies in","page_number":214,"box":{"x":69,"y":755,"width":805,"height":11}},{"id":"138697d4-4c0b-4303-aa97-77520b198fec","block_type":"box","text":"person; 4) “share-blocking” (requirements that investors who exercise their voting rights surrender the right to","page_number":214,"box":{"x":70,"y":771,"width":783,"height":11}},{"id":"e714ab3a-d1f5-4129-a83e-504046ca44b3","block_type":"box","text":"dispose of their holdings from the point at which votes are submitted until after the after the shareholder meeting","page_number":214,"box":{"x":69,"y":785,"width":811,"height":12}},{"id":"97f2fe81-e22c-4327-b221-f9b0b6e290bd","block_type":"box","text":"has occurred); 5) potential difficulties in translating the proxy; 6) regulatory constraints; and 7) requirements to","page_number":214,"box":{"x":69,"y":801,"width":795,"height":11}},{"id":"1c3d2313-17c1-49a2-9688-29b4b9734f2f","block_type":"box","text":"provide local agents with powers of attorney to facilitate voting instructions. We are not suppor tive of impediments to","page_number":214,"box":{"x":70,"y":816,"width":835,"height":11}},{"id":"82d0fe35-1c59-490b-83cc-a3ecc74aa874","block_type":"box","text":"the exercise of voting rights such as share-blocking or overly burdensome administrative requirements.","page_number":214,"box":{"x":68,"y":831,"width":732,"height":11}},{"id":"e3c5e34a-161f-4e18-a5b6-64b7cbd2b04c","block_type":"box","text":"16","page_number":214,"box":{"x":69,"y":860,"width":9,"height":5}},{"id":"f295f91a-3664-48cf-afd2-dd3ba4ca8e28","block_type":"box","text":"For more information, please see our commentary “Our approach to engagement on human capital management,”","page_number":214,"box":{"x":84,"y":860,"width":814,"height":11}},{"id":"54cfe264-9c00-4e54-9baf-d6bc04655b70","block_type":"box","text":"December 2025.","page_number":214,"box":{"x":70,"y":875,"width":118,"height":9}},{"id":"6ea31412-2dcf-441e-a0b6-f9aa255c55e4","block_type":"box","text":"BlackRock Investment Stewardship","page_number":214,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"c1ebcb0b-41df-44cf-854c-c996b497886e","block_type":"box","text":"Global Principles | 12","page_number":214,"box":{"x":758,"y":942,"width":151,"height":13}},{"id":"55bc59fe-d20d-4e51-b44c-82c7814a3094","block_type":"box","text":"NM1026U-5982568-214/232","page_number":214,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"10c1fc9a-fef0-4d3d-9238-96e6b5d0df7e","block_type":"box","text":"BIS votes proxies in these situations on a “best-effor ts” basis. In addition, BIS may determine that it is generally","page_number":215,"box":{"x":102,"y":45,"width":807,"height":11}},{"id":"2f199fe7-daf4-45b7-8144-bff2772a36b6","block_type":"box","text":"in the interests of BlackRock’s clients not to vote proxies (or not to vote our full allocation) if the costs (including but","page_number":215,"box":{"x":70,"y":60,"width":830,"height":11}},{"id":"166673dc-2f33-4cf5-9749-38c704ef364b","block_type":"box","text":"not limited to oppor tunity costs associated with share-blocking constraints) associated with exercising a vote are","page_number":215,"box":{"x":69,"y":75,"width":805,"height":11}},{"id":"bbc0cbd4-67c8-4da8-bbdf-56b8dafe71e5","block_type":"box","text":"expected to outweigh the benefit the client would derive by voting on the proposal.","page_number":215,"box":{"x":69,"y":90,"width":585,"height":11}},{"id":"fa6dcd61-d2bb-4398-803e-dd27ffc51fd1","block_type":"box","text":"CONFLICTS MANAGEMENT POLICIES AND PROCEDURES","page_number":215,"box":{"x":281,"y":120,"width":416,"height":9}},{"id":"f28ab56c-325d-4531-a716-2a625bcf515c","block_type":"box","text":"BIS is a dedicated function whose responsibilities are separate from BlackRock’s sales, business par tnership or","page_number":215,"box":{"x":102,"y":143,"width":804,"height":11}},{"id":"8836c5a7-af5a-45cb-921c-e1cbe920516a","block_type":"box","text":"enterprise-level vendor management activities.","page_number":215,"box":{"x":69,"y":158,"width":329,"height":11}},{"id":"02d7b8dd-f6a1-476f-b14c-acdc7b8bb847","block_type":"box","text":"BlackRock maintains policies and procedures that are designed to prevent undue influence on BIS’ proxy voting","page_number":215,"box":{"x":102,"y":181,"width":794,"height":11}},{"id":"de98a259-ccc1-456b-9059-9ae3e42f6814","block_type":"box","text":"activity. Such influence might stem from any relationship between the investee company (or any shareholder","page_number":215,"box":{"x":69,"y":196,"width":771,"height":11}},{"id":"ba5a443a-ab76-4c1d-b689-33aff7563bbe","block_type":"box","text":"proponent or dissident shareholder) and BlackRock, BlackRock’s affiliates, a Fund or a Fund’s affiliates, or","page_number":215,"box":{"x":70,"y":211,"width":763,"height":11}},{"id":"bd3c77ab-c481-42c1-89f1-75060a2a0679","block_type":"box","text":"BlackRock employees.","page_number":215,"box":{"x":70,"y":226,"width":157,"height":11}},{"id":"43bcebeb-914e-43bb-b92f-5983f1efd568","block_type":"box","text":"For information on how BIS manages conflicts of interest, please see our disclosure.","page_number":215,"box":{"x":102,"y":249,"width":602,"height":11}},{"id":"fbfb1899-906d-4ee3-a99d-3e1b48666840","block_type":"box","text":"SECURITIES LENDING","page_number":215,"box":{"x":409,"y":279,"width":159,"height":9}},{"id":"89e69cbd-a2db-4316-ae44-f63a6b4a4514","block_type":"box","text":"When authorized, BlackRock acts as a securities lending agent on behalf of its clients. Lending securities","page_number":215,"box":{"x":101,"y":302,"width":751,"height":11}},{"id":"f9c3479e-6667-4cfd-8af8-7438bdbf6a64","block_type":"box","text":"enables BlackRock to increase the returns in clients’ por tfolios, and BlackRock’s lending agreements allow it to","page_number":215,"box":{"x":69,"y":317,"width":797,"height":11}},{"id":"edec013d-c644-4265-9dd1-c566887d44c3","block_type":"box","text":"recall securities out on loan at any time. BlackRock (or any other lender) does not retain voting rights for securities","page_number":215,"box":{"x":69,"y":332,"width":817,"height":11}},{"id":"817a3d8d-a232-4fb6-967a-05d346baf8ce","block_type":"box","text":"out on loan. Entitlements associated with the lent securities (dividends, coupons, etc.), while on loan are paid back","page_number":215,"box":{"x":69,"y":347,"width":823,"height":11}},{"id":"8726ae09-69e4-4ac8-8cc1-8add4cb35bff","block_type":"box","text":"to the lender of the security as stipulated in industry standard legal agreements.","page_number":215,"box":{"x":68,"y":362,"width":575,"height":11}},{"id":"695d5245-3585-49cd-823e-599899fc302b","block_type":"box","text":"With regard to the relationship between securities lending and proxy voting, BlackRock cannot vote shares on","page_number":215,"box":{"x":101,"y":385,"width":779,"height":11}},{"id":"02103d20-49a5-42d7-a8dd-13d192728980","block_type":"box","text":"loan and may determine to recall them for voting, as guided by our fiduciary duty as an asset manager to our clients","page_number":215,"box":{"x":70,"y":400,"width":827,"height":11}},{"id":"21fe9dca-0aa0-4c44-9511-e80d0dd2c9b2","block_type":"box","text":"in helping them achieve their investment goals. While this has occurred in a limited number of cases, the decision to","page_number":215,"box":{"x":70,"y":415,"width":832,"height":11}},{"id":"0cb5dee6-fdf7-44f1-ba5b-7967b28a0b8a","block_type":"box","text":"recall securities on loan as par t of BlackRock’s securities lending program in order to vote is based on an evaluation","page_number":215,"box":{"x":69,"y":430,"width":832,"height":11}},{"id":"59851866-9f33-4b3f-9096-25408c998b40","block_type":"box","text":"of various factors that include, but are not limited to, assessing potential securities lending revenue alongside the","page_number":215,"box":{"x":69,"y":445,"width":814,"height":12}},{"id":"6bd38592-6b33-45cf-bfae-974e27cc7071","block_type":"box","text":"potential long-term financial value to clients of voting those securities (based on the information available at the time","page_number":215,"box":{"x":70,"y":460,"width":834,"height":12}},{"id":"f59f1221-aa50-4aa3-8442-01954358e211","block_type":"box","text":"of recall consideration).","page_number":215,"box":{"x":69,"y":475,"width":166,"height":12}},{"id":"ebb113d1-46ac-4b26-9f5a-dcb52d884e70","block_type":"box","text":"17","page_number":215,"box":{"x":237,"y":476,"width":9,"height":4}},{"id":"e6f74aef-91f7-4654-a72d-427e2cb0f669","block_type":"box","text":"BIS works with colleagues in the Securities Lending and Risk and Quantitative Analysis","page_number":215,"box":{"x":252,"y":476,"width":617,"height":11}},{"id":"6d2a4361-9c86-4e53-a5d0-943a6ac719a0","block_type":"box","text":"teams to evaluate the costs and benefits to clients of recalling shares on loan.","page_number":215,"box":{"x":68,"y":491,"width":563,"height":11}},{"id":"958f2201-0837-43c1-aaec-ae152d7eae03","block_type":"box","text":"In almost all instances, BlackRock anticipates that the potential long-term financial value to clients of voting","page_number":215,"box":{"x":102,"y":513,"width":770,"height":12}},{"id":"b66de718-236d-460a-ab0a-580d052859bb","block_type":"box","text":"shares would be less than the potential revenue the loan may provide clients. However, in cer tain instances,","page_number":215,"box":{"x":69,"y":529,"width":774,"height":11}},{"id":"5e936559-f6dc-4593-b12d-45f32c28a91b","block_type":"box","text":"BlackRock may determine, in our independent business judgment as a fiduciary, that the value of voting outweighs","page_number":215,"box":{"x":70,"y":543,"width":816,"height":12}},{"id":"1aa06f29-b8fe-47b2-95ce-f8af5f9cfaa9","block_type":"box","text":"the securities lending revenue loss to clients and would therefore recall shares to be voted in those instances. It is","page_number":215,"box":{"x":68,"y":559,"width":822,"height":11}},{"id":"949f4c88-3993-4100-a80f-650173d61214","block_type":"box","text":"impor tant to note that the majority of lendable assets in the market at any given time are not out on loan.","page_number":215,"box":{"x":70,"y":574,"width":752,"height":11}},{"id":"5dcea3eb-a2e1-4fe1-9c14-9b2a5be1e57a","block_type":"box","text":"Periodically, BlackRock reviews our process for determining whether to recall securities on loan in order to vote","page_number":215,"box":{"x":102,"y":596,"width":790,"height":12}},{"id":"1174678c-52d4-414b-9b69-dd2ec477e654","block_type":"box","text":"and may modify it as necessary.","page_number":215,"box":{"x":69,"y":612,"width":228,"height":11}},{"id":"9b63c771-e2a6-4cd6-a72d-c38f0b36e372","block_type":"box","text":"VOTING CHOICE","page_number":215,"box":{"x":430,"y":642,"width":117,"height":9}},{"id":"77e791e5-9675-4ea5-bad3-891d96c23c16","block_type":"box","text":"BlackRock offers Voting Choice, a program that provides eligible clients with more oppor tunities to par ticipate in","page_number":215,"box":{"x":102,"y":664,"width":800,"height":12}},{"id":"61eccac3-9e6b-4ec1-80cf-14a89def1e09","block_type":"box","text":"the proxy voting process, where legally and operationally viable.","page_number":215,"box":{"x":68,"y":680,"width":452,"height":11}},{"id":"1162c8da-5357-4d08-b6d4-0dd80a326b15","block_type":"box","text":"18","page_number":215,"box":{"x":522,"y":680,"width":9,"height":4}},{"id":"b87e7049-1e8e-4a46-a55d-b6ec9fb03db7","block_type":"box","text":"Voting Choice is currently available for eligible clients invested in cer tain institutional pooled funds in the U.S.,","page_number":215,"box":{"x":101,"y":702,"width":786,"height":12}},{"id":"00de0275-dcc7-4d7d-8420-e5c8f001b25c","block_type":"box","text":"UK, Ireland, Canada, and Switzerland that utilize index equity investment strategies, as well as eligible clients in","page_number":215,"box":{"x":70,"y":718,"width":797,"height":11}},{"id":"34477791-3af5-4368-93c1-5af7ca3bc279","block_type":"box","text":"17","page_number":215,"box":{"x":69,"y":747,"width":8,"height":4}},{"id":"65b545aa-fcce-4e2c-b501-6f4fef4e7dba","block_type":"box","text":"Recalling securities on loan can be impacted by the timing of record dates. In the U.S., for example, the record","page_number":215,"box":{"x":84,"y":747,"width":789,"height":11}},{"id":"97e2e3d4-df5f-4322-b2ec-6e1ab773bb51","block_type":"box","text":"date of a shareholder meeting typically falls before the proxy statements are released. Accordingly, it is not","page_number":215,"box":{"x":69,"y":762,"width":763,"height":11}},{"id":"051da1d6-b86a-4691-8ec1-547fbe19311d","block_type":"box","text":"practicable to evaluate a proxy statement, determine that a vote has a material impact on a fund and recall any","page_number":215,"box":{"x":70,"y":777,"width":794,"height":11}},{"id":"98f47378-8850-44e0-b35a-389e3418fc8c","block_type":"box","text":"shares on loan in advance of the record date for the annual meeting. As a result, managers must weigh independent","page_number":215,"box":{"x":69,"y":792,"width":833,"height":11}},{"id":"aea3ebea-5f16-4458-b295-e9d6d9749e96","block_type":"box","text":"business judgement as a fiduciary, the benefit to a fund’s shareholders of recalling loaned shares in advance of an","page_number":215,"box":{"x":69,"y":807,"width":821,"height":11}},{"id":"d2afbdce-34a4-4aae-adf4-b72732cc84f4","block_type":"box","text":"estimated record date without knowing whether there will be a vote on matters which have a material impact on the","page_number":215,"box":{"x":69,"y":822,"width":823,"height":12}},{"id":"2208cdf6-5bf7-4cea-ac77-75df78658a7f","block_type":"box","text":"fund (thereby forgoing potential securities lending revenue for the fund’s shareholders) or leaving shares on loan to","page_number":215,"box":{"x":68,"y":837,"width":822,"height":12}},{"id":"defa080b-4213-4c82-8982-22cc03e5b97a","block_type":"box","text":"potentially earn revenue for the fund (thereby forgoing the oppor tunity to vote).","page_number":215,"box":{"x":70,"y":852,"width":558,"height":12}},{"id":"2ec3a5d0-8189-4440-a350-c9267fd1ec87","block_type":"box","text":"18","page_number":215,"box":{"x":69,"y":870,"width":9,"height":5}},{"id":"d391097e-9bc9-458f-8f61-6102cf3273d5","block_type":"box","text":"BlackRock will determine eligibility criteria under this program based upon, among other things, local market","page_number":215,"box":{"x":84,"y":870,"width":771,"height":11}},{"id":"f26e7c73-a8ec-4378-97f7-45f00c7b3ef4","block_type":"box","text":"regulation and practice, cost considerations, operational risk and/or complexity, and financial considerations,","page_number":215,"box":{"x":69,"y":885,"width":779,"height":11}},{"id":"3baf96ba-8bdb-4577-a292-a8b26d04ccf0","block_type":"box","text":"including the decision to lend securities.","page_number":215,"box":{"x":70,"y":901,"width":285,"height":11}},{"id":"db89d629-19cf-47a9-9d14-b6c09e0bf6fe","block_type":"box","text":"BlackRock Investment Stewardship","page_number":215,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"402c7fcd-5d07-43fd-b5b2-c8b59f922e55","block_type":"box","text":"Global Principles | 13","page_number":215,"box":{"x":758,"y":942,"width":151,"height":13}},{"id":"62ff92e2-34b8-4ef1-915b-921832b7b8f9","block_type":"box","text":"NM1026U-5982568-215/232","page_number":215,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"30f955f0-d760-4cdb-b0a8-8eeb39979c64","block_type":"box","text":"cer tain institutional pooled funds in the U.S., UK, Canada, and Switzerland that use systematic active equity","page_number":216,"box":{"x":69,"y":45,"width":772,"height":11}},{"id":"cba4e36b-09ac-4315-a91e-85f31dfcb490","block_type":"box","text":"(SAE) strategies. In addition, institutional clients in separately managed accounts (SMAs) continue to be eligible for","page_number":216,"box":{"x":69,"y":60,"width":822,"height":11}},{"id":"a2aa998f-b8cc-43af-8492-050e4a464de8","block_type":"box","text":"BlackRock Voting Choice regardless of their investment strategies.","page_number":216,"box":{"x":70,"y":75,"width":471,"height":11}},{"id":"3cf6823a-1ef6-4331-bc85-83f2d55c9394","block_type":"box","text":"19","page_number":216,"box":{"x":543,"y":75,"width":9,"height":5}},{"id":"cfe0c112-4d47-4474-9c3c-c5f55762959f","block_type":"box","text":"Voting Choice is also available for eligible U.S.","page_number":216,"box":{"x":558,"y":75,"width":328,"height":11}},{"id":"024d0b78-39f2-4c31-8f8c-4e9fac2a288b","block_type":"box","text":"retail shareholder accounts invested in BlackRock’s largest U.S. exchange-traded fund.","page_number":216,"box":{"x":69,"y":90,"width":619,"height":11}},{"id":"ce248fdb-33eb-47ec-b2d6-fe52d8e67252","block_type":"box","text":"20","page_number":216,"box":{"x":690,"y":90,"width":9,"height":5}},{"id":"f2efdf5f-e910-44d1-9440-f67b218132de","block_type":"box","text":"As a result, the shares attributed to BlackRock por tfolios in company share registers may be voted differently","page_number":216,"box":{"x":101,"y":113,"width":782,"height":11}},{"id":"0f638353-3206-4ae3-9cd9-460b4f0d1f22","block_type":"box","text":"depending on whether our clients have authorized BIS to vote on their behalf, have authorized BIS to vote in","page_number":216,"box":{"x":69,"y":128,"width":767,"height":11}},{"id":"fa8194a6-6733-4a8a-b897-cb124adcf0f1","block_type":"box","text":"accordance with a third-par ty policy, or have elected to vote shares in accordance with their own policy. Our clients","page_number":216,"box":{"x":69,"y":143,"width":814,"height":11}},{"id":"ceb86ff9-2a0d-4b7c-8600-2e561d44e2ed","block_type":"box","text":"have greater control over proxy voting because of Voting Choice.","page_number":216,"box":{"x":69,"y":158,"width":454,"height":11}},{"id":"22ce23bf-8a4e-46ed-9492-3b085588ab55","block_type":"box","text":"21","page_number":216,"box":{"x":525,"y":158,"width":9,"height":5}},{"id":"9fb63c62-dfbd-43c1-9a9c-21495b132e1a","block_type":"box","text":"REPORTING AND VOTE TRANSPARENCY","page_number":216,"box":{"x":343,"y":188,"width":293,"height":9}},{"id":"9a686ff9-4f92-4283-aebd-1f59ec4f98d5","block_type":"box","text":"We are committed to transparency of the stewardship work we do on behalf of clients. We inform clients about","page_number":216,"box":{"x":101,"y":211,"width":789,"height":11}},{"id":"31611ff5-9e04-4d2c-ab74-1c85169f91c7","block_type":"box","text":"our engagement and voting policies and activities through direct communication and through disclosure on our","page_number":216,"box":{"x":69,"y":226,"width":787,"height":11}},{"id":"38f33f49-f160-451f-85b4-d1c2f88f45f5","block_type":"box","text":"website. We make public our regional voting guidelines for the benefit of clients and the companies in which we","page_number":216,"box":{"x":68,"y":241,"width":795,"height":11}},{"id":"bea6deed-a864-4ff4-a600-6a85a55dcc4e","block_type":"box","text":"invest on their behalf. We also publish commentaries to share our approach to engagement on our five engagement","page_number":216,"box":{"x":70,"y":256,"width":825,"height":12}},{"id":"02218f85-c6df-414c-8c30-44ae6ad26b45","block_type":"box","text":"priorities, as well as quar terly repor ts detailing our proxy voting and engagement activities.","page_number":216,"box":{"x":70,"y":272,"width":644,"height":11}},{"id":"28c226da-8d8a-4071-87ff-43cc996707fb","block_type":"box","text":"19","page_number":216,"box":{"x":69,"y":324,"width":9,"height":4}},{"id":"67b102e1-ac1e-46a8-bd1b-51cb2a39fe14","block_type":"box","text":"With Voting Choice, SMA clients have the ability to select the policy that best aligns with their views and","page_number":216,"box":{"x":83,"y":323,"width":739,"height":12}},{"id":"40bdd923-e689-4aa6-9ada-d49fda92ac98","block_type":"box","text":"preferences from a set of voting policies from third-par ty proxy advisers. BlackRock can then use its proxy voting","page_number":216,"box":{"x":70,"y":338,"width":800,"height":12}},{"id":"e8febcd4-c0f1-426b-9da9-0d0fa6ef8f39","block_type":"box","text":"infrastructure to cast votes for the SMA based on the client’s selected voting policy.","page_number":216,"box":{"x":70,"y":354,"width":596,"height":11}},{"id":"b7ab3661-6e60-42b3-b6d7-714dd7a4496d","block_type":"box","text":"20","page_number":216,"box":{"x":69,"y":372,"width":9,"height":4}},{"id":"fb5e7a8f-2d2a-4764-9fc2-bec350419c3f","block_type":"box","text":"Read more about BlackRock Voting Choice on our website.","page_number":216,"box":{"x":84,"y":371,"width":415,"height":11}},{"id":"b0b8f118-4910-4beb-a815-10f394be8903","block_type":"box","text":"21","page_number":216,"box":{"x":69,"y":389,"width":9,"height":5}},{"id":"04a495e0-b62a-4960-9201-91a939c84f76","block_type":"box","text":"BlackRock does not disclose client information, including a client’s selection of proxy policy, without client consent.","page_number":216,"box":{"x":84,"y":389,"width":820,"height":11}},{"id":"010a47b9-98b4-4eb2-8347-7b09fd312ba1","block_type":"box","text":"BlackRock Investment Stewardship","page_number":216,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"06d29242-5ffd-4a50-bf60-832ac27e2d07","block_type":"box","text":"Global Principles | 14","page_number":216,"box":{"x":758,"y":942,"width":151,"height":13}},{"id":"84b5c784-85a1-435b-97ba-9bfcd16c720a","block_type":"box","text":"NM1026U-5982568-216/232","page_number":216,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"db5fdff8-14ce-4a23-b69f-72cff1e9f1d8","block_type":"box","text":"Want to know more?","page_number":217,"box":{"x":68,"y":731,"width":152,"height":9}},{"id":"1b5b17ab-9c3d-4cd1-b9c4-0a3a7799c47d","block_type":"box","text":"blackrock.com/stewardship | contactstewardship@blackrock.com","page_number":217,"box":{"x":69,"y":761,"width":464,"height":13}},{"id":"b41a645a-0bff-4301-bf5f-708525aa06e5","block_type":"box","text":"This document is provided for information and educational purposes only. 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related to climate","page_number":220,"box":{"x":101,"y":526,"width":784,"height":11}},{"id":"705bb5ad-337f-4e05-a6e6-225970616a48","block_type":"box","text":"risks and the transition to a low-carbon economy at companies that are held by in-scope funds and accounts that","page_number":220,"box":{"x":69,"y":541,"width":806,"height":11}},{"id":"32612493-7ef4-4924-9ef6-be9525735c77","block_type":"box","text":"apply these Guidelines.","page_number":220,"box":{"x":69,"y":556,"width":165,"height":11}},{"id":"026317cf-6a3b-4c69-b9dc-ec6b4a324622","block_type":"box","text":"The Guidelines differ from the Benchmark Policies in that they consider, in addition to financial objectives,","page_number":220,"box":{"x":101,"y":579,"width":755,"height":11}},{"id":"ef7e935f-dc90-4a55-a4e9-2bc68ed320f9","block_type":"box","text":"companies’ strategies to align with the transition to a low-carbon economy. They also incorporate the more ambitious","page_number":220,"box":{"x":69,"y":594,"width":834,"height":11}},{"id":"15685afb-8958-4573-8c7a-f3e1a8099973","block_type":"box","text":"goal of the Paris Agreement - namely to limit average global temperature rise to 1.5°C above pre-industrial levels.","page_number":220,"box":{"x":68,"y":609,"width":806,"height":11}},{"id":"4513a08b-8d4a-4b41-9a70-f835c54bae7d","block_type":"box","text":"6","page_number":220,"box":{"x":876,"y":609,"width":4,"height":5}},{"id":"dfd0ab89-73a9-4e0d-bb94-065dc539665c","block_type":"box","text":"The Guidelines apply primarily to companies in sectors that play an impor tant role in the transition to a low","page_number":220,"box":{"x":101,"y":632,"width":766,"height":11}},{"id":"910cad88-270c-47ad-ad19-e2fbf2e2ec9d","block_type":"box","text":"carbon economy. 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Fur ther, the Guidelines consider the","page_number":222,"box":{"x":102,"y":45,"width":751,"height":11}},{"id":"ceca1b19-6221-4822-bbf5-fcf450322f73","block_type":"box","text":"differences between the actions and outcomes over which company management has influence, and those it","page_number":222,"box":{"x":101,"y":60,"width":778,"height":11}},{"id":"a1d9d945-71ac-42cb-a773-5c98d7178f23","block_type":"box","text":"does not.","page_number":222,"box":{"x":101,"y":75,"width":66,"height":9}},{"id":"885571d1-d6a1-4f41-8755-91888ccd87b3","block_type":"box","text":"•","page_number":222,"box":{"x":69,"y":98,"width":6,"height":4}},{"id":"5229ab23-0312-4648-977a-a4dc62b186ec","block_type":"box","text":"Focus on useful, contextualized disclosures that help inform investors views, while recognizing data","page_number":222,"box":{"x":102,"y":95,"width":729,"height":11}},{"id":"0d336e57-9be1-4d5a-a87a-8756296c32cc","block_type":"box","text":"limitations:","page_number":222,"box":{"x":102,"y":110,"width":80,"height":9}},{"id":"5fe4083f-34df-49ba-b76c-ae93ed61c102","block_type":"box","text":"Under the Guidelines, the dedicated team looks for disclosures that outline key milestones and","page_number":222,"box":{"x":189,"y":110,"width":679,"height":11}},{"id":"58f6b332-e628-4c4f-9385-b8466379fc13","block_type":"box","text":"dependencies underpinning the company’s low-carbon transition strategy, explain the trade-offs required to adapt","page_number":222,"box":{"x":101,"y":125,"width":807,"height":12}},{"id":"b756892b-2fcf-427d-ab98-0a78e4d120df","block_type":"box","text":"the business model, and include relevant data and narrative.","page_number":222,"box":{"x":101,"y":141,"width":433,"height":10}},{"id":"550ff9be-e0e3-4d44-aedb-e2becdc8b314","block_type":"box","text":"•","page_number":222,"box":{"x":69,"y":163,"width":6,"height":5}},{"id":"fbd470ea-fff8-4c08-b137-9aa66f8fe1d3","block_type":"box","text":"Consistency with the participating clients’ position as a minority investor:","page_number":222,"box":{"x":101,"y":161,"width":541,"height":11}},{"id":"31864e5d-04d6-4885-8648-c857cfad7a76","block_type":"box","text":"The boards and executive leadership","page_number":222,"box":{"x":648,"y":161,"width":261,"height":11}},{"id":"4173da4c-19b1-4482-9c35-881adcd10473","block_type":"box","text":"of companies determine a company’s strategy and its implementation. Under the Guidelines, the dedicated team","page_number":222,"box":{"x":102,"y":176,"width":805,"height":11}},{"id":"17b1d91d-6e70-4cda-8c67-81b33263f406","block_type":"box","text":"makes decisions on how to engage companies and vote proxies independently, based on its professional","page_number":222,"box":{"x":102,"y":191,"width":748,"height":11}},{"id":"14f70d11-2605-482c-8c32-2beae71e8df5","block_type":"box","text":"judgment of the priorities and outcomes most aligned with par ticipating clients’ investment objectives.","page_number":222,"box":{"x":100,"y":206,"width":730,"height":11}},{"id":"6614faa7-3965-427e-ab67-fc1173eb733f","block_type":"box","text":"Voting approach under the Guidelines","page_number":222,"box":{"x":68,"y":236,"width":273,"height":11}},{"id":"3ef59980-0b8c-4d34-b793-a313d0095dfc","block_type":"box","text":"12","page_number":222,"box":{"x":342,"y":237,"width":9,"height":4}},{"id":"40ba4b31-46ab-482f-b00b-a0eb75a3312e","block_type":"box","text":"When evaluating each voting item across management or shareholder proposals, the dedicated team applies a","page_number":222,"box":{"x":101,"y":259,"width":791,"height":11}},{"id":"f7c02f82-9b49-46b4-a6b3-e8491a548a5f","block_type":"box","text":"case-by-case approach that reflects the uneven pace of the low-carbon transition across sectors and markets, and","page_number":222,"box":{"x":69,"y":274,"width":813,"height":11}},{"id":"c448c7f4-7755-40b4-a39c-f5c899eb0bf0","block_type":"box","text":"acknowledges the distinction between what company management can influence and what lies beyond its control. As","page_number":222,"box":{"x":69,"y":289,"width":833,"height":11}},{"id":"4442628e-7e8b-4228-aaaa-cfd85de1254a","block_type":"box","text":"a result, voting decisions — on behalf of in-scope funds and SMAs — on similar proposals included on different","page_number":222,"box":{"x":69,"y":304,"width":799,"height":11}},{"id":"738f83b8-b364-4900-be49-0cb18e646d9b","block_type":"box","text":"companies’ shareholder meeting agendas may vary depending on company, sector, or market-specific circumstances.","page_number":222,"box":{"x":69,"y":319,"width":837,"height":12}},{"id":"909e4572-2e31-41f9-8f35-5d138e959a22","block_type":"box","text":"Consistent with the investment objective of each fund or account that has selected these Guidelines, the","page_number":222,"box":{"x":102,"y":342,"width":748,"height":11}},{"id":"fb2dd8dc-2b12-4005-92c2-35e055adebe9","block_type":"box","text":"dedicated team will look to the companies to demonstrate the following:","page_number":222,"box":{"x":69,"y":357,"width":513,"height":11}},{"id":"c02db41e-7ef7-43c2-9fc9-04ce27f0a4b1","block_type":"box","text":"Corporate Disclosures","page_number":222,"box":{"x":69,"y":387,"width":160,"height":11}},{"id":"207d2455-cfa3-4785-8423-576ddb6a4b0b","block_type":"box","text":"13","page_number":222,"box":{"x":230,"y":388,"width":9,"height":4}},{"id":"fd2dcf21-d402-4ea5-b468-d9bdb0d8061c","block_type":"box","text":"In the context of these Guidelines, the dedicated team looks for companies to provide sufficient disclosure to","page_number":222,"box":{"x":102,"y":410,"width":781,"height":11}},{"id":"6bedfee0-be67-4755-b29a-8a29219ecacc","block_type":"box","text":"assess whether the company’s strategy is aligned with the low-carbon transition. As a general point, the team looks","page_number":222,"box":{"x":69,"y":425,"width":825,"height":11}},{"id":"1cb0d6a5-f271-42cb-9612-a98274239837","block_type":"box","text":"to companies that are impor tant to the transition to a low-carbon economy to explain the strategy and governance","page_number":222,"box":{"x":68,"y":440,"width":812,"height":12}},{"id":"e757bcc1-44b8-4b01-aed7-93ef90df7bbb","block_type":"box","text":"frameworks that they have determined most appropriate, which may include:","page_number":222,"box":{"x":68,"y":455,"width":545,"height":11}},{"id":"51f55dc9-0120-4cf9-81ba-62ea9a77f94f","block_type":"box","text":"(1) a low-carbon transition strategy to demonstrate their alignment with the ambition to limit average global","page_number":222,"box":{"x":69,"y":476,"width":769,"height":11}},{"id":"537f7583-fc29-4a64-aae8-58acee7b41fd","block_type":"box","text":"temperature rise to 1.5°C above pre-industrial levels. This would typically include a long-term strategy to achieve","page_number":222,"box":{"x":101,"y":491,"width":800,"height":11}},{"id":"f5e8d9f2-2ba1-4f89-863a-a154e76c36e3","block_type":"box","text":"net-zero GHG emissions by 2050, with appropriate near- and medium-term milestones to assess their progress.","page_number":222,"box":{"x":102,"y":506,"width":796,"height":11}},{"id":"15a8b825-47f1-4c51-a139-219862cda769","block_type":"box","text":"(2) low-carbon transition-related repor ting. Standardized disclosure of sustainability-related data suppor ts investors","page_number":222,"box":{"x":69,"y":526,"width":828,"height":11}},{"id":"6e2516bc-c346-4b0f-9cbf-e0b838840709","block_type":"box","text":"in making informed decisions. The International Sustainability Standards Board (ISSB) standards, IFRS S1 and","page_number":222,"box":{"x":102,"y":541,"width":787,"height":11}},{"id":"31e353e1-36db-473a-97a8-cbb9f552535f","block_type":"box","text":"S2, represent one such approach to standardization that the dedicated team finds useful in its analysis.","page_number":222,"box":{"x":102,"y":556,"width":741,"height":11}},{"id":"5ca02c65-20f4-4db5-a91f-f979b5dddec1","block_type":"box","text":"14, 15","page_number":222,"box":{"x":845,"y":557,"width":25,"height":5}},{"id":"b7a6a9a0-56f5-48ef-896d-6938965d3195","block_type":"box","text":"IFRS","page_number":222,"box":{"x":877,"y":556,"width":30,"height":9}},{"id":"b5bd144d-2b63-4345-8623-d4bf8fa1ccfc","block_type":"box","text":"S1 addresses the general requirements of sustainability repor ting and IFRS S2 sets out the disclosures that","page_number":222,"box":{"x":102,"y":571,"width":774,"height":12}},{"id":"a1eca321-196e-4222-9109-ec6c8b5acafe","block_type":"box","text":"provide investors with decision-useful information about a company’s most significant climate- and low-carbon","page_number":222,"box":{"x":102,"y":586,"width":781,"height":12}},{"id":"2d99115b-c2c3-49ab-a06d-7e513cd34ecd","block_type":"box","text":"transition-related risks and oppor tunities. This includes receiving independent, third-par ty assurances, as audit","page_number":222,"box":{"x":101,"y":602,"width":792,"height":11}},{"id":"772b67c5-ad11-4a8b-8ef7-46df0ebecf37","block_type":"box","text":"and assurance standards are developed.","page_number":222,"box":{"x":102,"y":617,"width":290,"height":11}},{"id":"7c63b56a-eb4d-4f17-89ba-95bd02b75dfa","block_type":"box","text":"12","page_number":222,"box":{"x":69,"y":646,"width":9,"height":5}},{"id":"51b42886-62e3-444e-8588-b84bbebf3437","block_type":"box","text":"These Guidelines are not intended to limit the analysis of individual issues at specific companies or provide a guide","page_number":222,"box":{"x":83,"y":646,"width":825,"height":11}},{"id":"98c42f39-9035-4685-a48e-a16b6da94669","block_type":"box","text":"as to how the dedicated team will engage and/or vote in every instance. The Guidelines are applied by the dedicated","page_number":222,"box":{"x":69,"y":661,"width":833,"height":11}},{"id":"6fb046fd-03ef-4649-8982-182f2fa1c121","block_type":"box","text":"team with discretion, on a case-by-case basis, taking into consideration the range of issues and facts specific to the","page_number":222,"box":{"x":68,"y":676,"width":830,"height":11}},{"id":"e64782c6-eab1-41a1-a235-9a0fa62f7be1","block_type":"box","text":"company, as well as individual ballot items at shareholder meetings.","page_number":222,"box":{"x":69,"y":691,"width":486,"height":11}},{"id":"1bae1e05-457b-4dc9-bdfa-7acb9781b17a","block_type":"box","text":"13","page_number":222,"box":{"x":69,"y":709,"width":9,"height":5}},{"id":"528ec40c-67c2-41ad-a51c-d6fb64e7d7e4","block_type":"box","text":"Given data and measurement limitations, companies may need to provide estimated GHG emissions where","page_number":222,"box":{"x":84,"y":709,"width":764,"height":11}},{"id":"2a649805-cbe4-46af-bf84-8a903b0e553e","block_type":"box","text":"repor ting methodologies are nascent. In addition, cer tain disclosures related to a company’s plans for adapting their","page_number":222,"box":{"x":69,"y":724,"width":834,"height":11}},{"id":"7d20dc05-6e63-49aa-b65f-7b0dc9bf2d65","block_type":"box","text":"business models through the low-carbon transition may require forward-looking statements.","page_number":222,"box":{"x":69,"y":739,"width":651,"height":11}},{"id":"fa337c53-449c-4138-8d18-c462cbb534a8","block_type":"box","text":"14","page_number":222,"box":{"x":69,"y":757,"width":9,"height":4}},{"id":"9b523d0f-fe37-4bdf-b73f-72c0c82384a5","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Repor ting Standards","page_number":222,"box":{"x":83,"y":757,"width":744,"height":11}},{"id":"9e29eaa0-5364-4bb0-b44b-2026de9a32dc","block_type":"box","text":"(IFRS) Foundation. The standards build on the Task Force on Climate-related Financial Disclosures (TCFD) framework","page_number":222,"box":{"x":69,"y":772,"width":828,"height":11}},{"id":"5c0c1f9e-7ecd-4b03-85e4-84f0ac0d774e","block_type":"box","text":"and the standards and metrics developed by the Sustainability Accounting Standards Board (SASB), which have both","page_number":222,"box":{"x":69,"y":787,"width":830,"height":11}},{"id":"29457ff8-86d9-444c-b03e-c729a2528571","block_type":"box","text":"converged under the ISSB. Please refer to the IFRS website to learn more about the framework and standards S1","page_number":222,"box":{"x":69,"y":802,"width":809,"height":11}},{"id":"131fae91-152d-4cb8-b06b-33bca245a98e","block_type":"box","text":"“General Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related","page_number":222,"box":{"x":70,"y":817,"width":778,"height":11}},{"id":"1531697e-aef0-4492-be4c-7f567345b356","block_type":"box","text":"Disclosures.” Websites accessed in December 2025.","page_number":222,"box":{"x":70,"y":832,"width":380,"height":9}},{"id":"260edc1d-f4f3-4d28-8fce-3176692e6234","block_type":"box","text":"15","page_number":222,"box":{"x":69,"y":850,"width":9,"height":5}},{"id":"309b9fbb-434b-441b-a2d7-0bc4cdc8da8e","block_type":"box","text":"A number of jurisdictions are consulting on adopting the standards issued to date or have already committed to","page_number":222,"box":{"x":83,"y":850,"width":795,"height":11}},{"id":"1c7c58c9-0305-4bfa-87da-e50611aafe1d","block_type":"box","text":"doing so. BIS does not mandate any specific disclosure framework companies should use, and recognize that some","page_number":222,"box":{"x":69,"y":865,"width":826,"height":11}},{"id":"4f1ab35b-8662-4738-bf38-6d2e03e054bd","block_type":"box","text":"companies may repor t using different standards, some of which may be required by regulation. In such cases, we","page_number":222,"box":{"x":69,"y":880,"width":811,"height":11}},{"id":"389c7f93-d273-42fc-bd02-b03eb25c998b","block_type":"box","text":"ask that companies highlight the metrics that are industry- or company-specific. We also recognize that companies","page_number":222,"box":{"x":69,"y":895,"width":816,"height":12}},{"id":"6fd526f1-c90a-4ea3-ae67-c1b953e3bd15","block_type":"box","text":"may be phasing in repor ting over several years. We do not prescribe timelines regarding when companies should","page_number":222,"box":{"x":69,"y":911,"width":803,"height":11}},{"id":"7548dded-56d3-4dc9-99ed-f8e94c57c80c","block_type":"box","text":"BlackRock Investment Stewardship","page_number":222,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"0fede006-2309-4519-b732-428b3834cc90","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines | 5","page_number":222,"box":{"x":509,"y":942,"width":400,"height":13}},{"id":"0a9405f2-804a-454a-aa3f-c2f9d2149150","block_type":"box","text":"NM1026U-5982568-222/232","page_number":222,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"deb45392-6e20-471d-bb6f-5ac048656a38","block_type":"box","text":"(3) scope 1 and scope 2, and most significant scope 3 GHG emissions","page_number":223,"box":{"x":69,"y":45,"width":513,"height":11}},{"id":"da5c48fc-efdb-40a3-9fab-738ef819cc9e","block_type":"box","text":"16, 17","page_number":223,"box":{"x":583,"y":45,"width":26,"height":5}},{"id":"5d9c6d7e-8cfc-4a1e-89a2-d50f117e3b49","block_type":"box","text":"In addition, the dedicated team looks to","page_number":223,"box":{"x":615,"y":45,"width":283,"height":10}},{"id":"77de2ae1-ec53-4d0a-b07d-27f3b0fde0cd","block_type":"box","text":"companies to disclose their emissions reduction targets for scope 1 and 2 emissions, science-based where","page_number":223,"box":{"x":101,"y":60,"width":770,"height":11}},{"id":"f2d2a35f-3e12-4f15-83e0-f81be6a5e8f5","block_type":"box","text":"possible. The team welcomes disclosure of targets or indicative goals, where companies have set them, for","page_number":223,"box":{"x":102,"y":75,"width":768,"height":11}},{"id":"10ef9bb8-1196-448a-850a-9651a449f0c7","block_type":"box","text":"scope 3 emissions reductions. Scope 3 information, including how a company is working with its value chain to","page_number":223,"box":{"x":102,"y":90,"width":792,"height":11}},{"id":"178cf8fd-002f-4a06-b695-8c52f851f28d","block_type":"box","text":"accelerate reductions in GHG intensity, provides useful insight to investors focused on investing in the low","page_number":223,"box":{"x":102,"y":105,"width":760,"height":11}},{"id":"0c695b4c-168c-4df4-a49b-062ca06eccaf","block_type":"box","text":"carbon transition and understanding the impact of their investments on their decarbonization goals.","page_number":223,"box":{"x":101,"y":120,"width":709,"height":12}},{"id":"d34b94c3-9224-42ec-905b-e8a28c874307","block_type":"box","text":"18","page_number":223,"box":{"x":812,"y":121,"width":9,"height":4}},{"id":"bf2096b9-39a3-4a5f-b57e-7188cd9467d3","block_type":"box","text":"However,","page_number":223,"box":{"x":827,"y":120,"width":62,"height":11}},{"id":"46fb9731-2551-443b-af30-68bc8dd6f807","block_type":"box","text":"the team recognizes that companies have varying ability to influence the emissions across the different par ts of","page_number":223,"box":{"x":101,"y":135,"width":802,"height":12}},{"id":"880775bf-c668-47d0-b3c3-804aab31663c","block_type":"box","text":"their value chain and, therefore, it is helpful when disclosures explain the implications for the achievement of","page_number":223,"box":{"x":101,"y":150,"width":780,"height":11}},{"id":"9d70382a-dd92-4e79-9038-f82cf01af30c","block_type":"box","text":"their decarbonization targets. For some companies that play an impor tant role in the low-carbon transition, scope","page_number":223,"box":{"x":101,"y":166,"width":807,"height":11}},{"id":"300ef270-cd64-4b03-b8ba-74fbdca3a5c1","block_type":"box","text":"3 may represent their only significant source of GHG emissions in the value chain. While we do not believe","page_number":223,"box":{"x":102,"y":181,"width":759,"height":11}},{"id":"bbef70c4-55ef-4bdd-ab62-dc7d1bb0aa29","block_type":"box","text":"companies should be required to enforce emissions reduction targets outside of their control, where relevant, we","page_number":223,"box":{"x":101,"y":196,"width":808,"height":11}},{"id":"17bfadf0-faf5-46fa-8961-520649865ceb","block_type":"box","text":"look for disclosures on how the company approaches the low-carbon transition in these cases. This may include","page_number":223,"box":{"x":102,"y":211,"width":797,"height":11}},{"id":"1432b187-b3df-4b80-85ac-ba4fbbeb6e8d","block_type":"box","text":"plans and targets to grow businesses that contribute to real world decarbonization, forward-looking capital or","page_number":223,"box":{"x":102,"y":226,"width":777,"height":11}},{"id":"5f25b897-d7a9-4f03-9e8c-db22ad4f4349","block_type":"box","text":"procurement allocation plans to net-zero aligned activities or suppliers, and strategies to mitigate material","page_number":223,"box":{"x":102,"y":241,"width":755,"height":11}},{"id":"a7e3c8c9-05b7-463e-84d3-dc0f77e34a9d","block_type":"box","text":"transition risks.","page_number":223,"box":{"x":101,"y":257,"width":110,"height":8}},{"id":"15ba3249-f92b-4aee-9a4f-2f799bfb714c","block_type":"box","text":"(4) where relevant, disclosures that describe the company’s exposure to climate-related physical risks—such as","page_number":223,"box":{"x":69,"y":277,"width":808,"height":11}},{"id":"fd7a5cb7-f444-4042-a224-5c6f81a30ca3","block_type":"box","text":"acute risks from extreme weather events or chronic risks from long-term shifts in climate patterns—and how","page_number":223,"box":{"x":102,"y":292,"width":773,"height":11}},{"id":"263ac7c2-5c6e-40b0-bcd0-954ed9b70390","block_type":"box","text":"these risks could reasonably be expected to affect the company’s operations, assets, or supply chains.","page_number":223,"box":{"x":101,"y":307,"width":739,"height":11}},{"id":"5f5dde3f-ec5b-4f24-8d76-abb4323c324f","block_type":"box","text":"Transition plans","page_number":223,"box":{"x":68,"y":337,"width":115,"height":11}},{"id":"78fc3ee8-d687-4d63-9d06-5da1124581e8","block_type":"box","text":"Some companies have published transition plans outlining how they intend to implement their low-carbon","page_number":223,"box":{"x":102,"y":360,"width":748,"height":11}},{"id":"baf87528-d526-45f1-a121-84f283faaa06","block_type":"box","text":"transition strategies. As defined by the ISSB, a transition plan “lays out the entity’s targets, actions or resources for","page_number":223,"box":{"x":68,"y":375,"width":831,"height":11}},{"id":"552aef98-439c-4ec6-b47c-9356b6f8cf72","block_type":"box","text":"its transition towards a lower-carbon economy, including actions such as reducing its greenhouse gas emissions”","page_number":223,"box":{"x":70,"y":390,"width":805,"height":11}},{"id":"626bfbd5-b5d4-496b-97a8-f66d6f37d6ec","block_type":"box","text":"(see Appendix 1).","page_number":223,"box":{"x":69,"y":405,"width":122,"height":11}},{"id":"2d71867c-705b-4261-bbad-771f75e980f2","block_type":"box","text":"19","page_number":223,"box":{"x":193,"y":405,"width":9,"height":5}},{"id":"01de367f-7eba-4e5e-bebb-dffad0b0d3de","block_type":"box","text":"Work is also underway in a number of jurisdictions on establishing a common approach in a market to corporate","page_number":223,"box":{"x":101,"y":428,"width":800,"height":11}},{"id":"bcec6d48-965e-489a-83fc-d9b504aac930","block_type":"box","text":"transition plans.","page_number":223,"box":{"x":68,"y":443,"width":115,"height":11}},{"id":"9d73ebab-b1bd-4748-aa24-f73b73c11dc7","block_type":"box","text":"20","page_number":223,"box":{"x":184,"y":443,"width":9,"height":5}},{"id":"3b7c8a7c-c87b-4dfa-b752-05f186d40d8e","block_type":"box","text":"Recent guidance from the ISSB on disclosures about transition plans highlights the convergence of","page_number":223,"box":{"x":200,"y":443,"width":706,"height":11}},{"id":"a54955d7-cf99-4db0-adda-b2c6e8993862","block_type":"box","text":"repor ting approaches.","page_number":223,"box":{"x":69,"y":458,"width":156,"height":11}},{"id":"33df7fc3-5126-48b3-a7f9-b2c95dcb5acf","block_type":"box","text":"While the preparation of a transition plan, or lack thereof, is not, in itself, a voting issue, these disclosures","page_number":223,"box":{"x":101,"y":481,"width":762,"height":11}},{"id":"fa14ec02-d935-48f7-a281-7efb7c880c98","block_type":"box","text":"typically provide valuable insights that inform the dedicated team’s approach to engaging and voting on matters","page_number":223,"box":{"x":68,"y":496,"width":796,"height":11}},{"id":"662815df-a7ad-45c0-9f19-1f194aff9c31","block_type":"box","text":"related to climate and transition risks on behalf of in-scope funds and accounts.","page_number":223,"box":{"x":69,"y":511,"width":570,"height":11}},{"id":"03ff4ff3-74c6-47a9-8ffb-49c43dd22f7b","block_type":"box","text":"make sustainability-related disclosures but appreciate it when companies produce them sufficiently in advance of","page_number":223,"box":{"x":69,"y":537,"width":810,"height":12}},{"id":"3d9ae50b-f541-482e-ad11-54aa8be6d972","block_type":"box","text":"their shareholder meeting, to the best of their abilities, to provide investors with time to assess the data and make","page_number":223,"box":{"x":68,"y":553,"width":822,"height":11}},{"id":"43431a2c-2bd0-4adb-8d36-d8f3dd7bcc9d","block_type":"box","text":"informed voting decisions.","page_number":223,"box":{"x":70,"y":568,"width":184,"height":11}},{"id":"bffcdc23-4f06-4b38-bff1-9da6fe1a7f48","block_type":"box","text":"16","page_number":223,"box":{"x":69,"y":586,"width":9,"height":4}},{"id":"1780d543-9675-40a5-8391-1d1bb3d27823","block_type":"box","text":"FTSE Russell address the materiality of different categories of scope 3 GHG emissions by sector in a January 2024","page_number":223,"box":{"x":84,"y":585,"width":825,"height":12}},{"id":"fb9a05fc-7f36-4bf1-9006-cc63da78dbb0","block_type":"box","text":"paper: FTSE Russel, “Scope for improvement: Solving the Scope 3 conundrum,” January 2024, accessed in","page_number":223,"box":{"x":70,"y":600,"width":768,"height":12}},{"id":"48e80a23-4b3a-4c89-a95d-116c6cd0872e","block_type":"box","text":"December 2025.","page_number":223,"box":{"x":70,"y":616,"width":118,"height":9}},{"id":"c0fca6bb-c1ff-4d24-9790-7c2a27b436e5","block_type":"box","text":"17","page_number":223,"box":{"x":69,"y":634,"width":8,"height":4}},{"id":"7088c5dd-c251-4845-9aeb-c099389daaf8","block_type":"box","text":"Under this policy, the dedicated team looks for GHG emissions disclosures to be aligned with the Greenhouse Gas","page_number":223,"box":{"x":84,"y":633,"width":815,"height":12}},{"id":"b0f5a14f-09d9-4adb-b914-4a043cb68b8b","block_type":"box","text":"Protocol (GHG Protocol). The Protocol Standards and Guidance are currently being updated to ensure they continue to","page_number":223,"box":{"x":69,"y":648,"width":838,"height":12}},{"id":"cbe45d04-7850-48d7-9509-3f3dc5d64f6b","block_type":"box","text":"provide “a rigorous and credible accounting foundation for businesses to measure, plan and track progress toward","page_number":223,"box":{"x":70,"y":663,"width":816,"height":12}},{"id":"82be8ff6-638d-41d8-a83e-18c022f2c8c4","block_type":"box","text":"science-based and net-zero targets in line with the global 1.5°C goal.” Websites accessed in December 2025.","page_number":223,"box":{"x":69,"y":679,"width":784,"height":11}},{"id":"61c56c19-823a-4936-a8ed-d8f068409c3a","block_type":"box","text":"18","page_number":223,"box":{"x":69,"y":697,"width":9,"height":4}},{"id":"80a11fd2-521b-4767-86ee-7f588b002917","block_type":"box","text":"The dedicated team does not believe the purpose of scope 3 disclosure requirements should be to push publicly","page_number":223,"box":{"x":83,"y":696,"width":804,"height":11}},{"id":"ae59e2f1-0890-4b32-809d-708a30536fb1","block_type":"box","text":"traded companies into the role of enforcing emission reduction targets outside of their control. Given methodological","page_number":223,"box":{"x":68,"y":711,"width":832,"height":12}},{"id":"0d36c2b1-7ff6-4f4c-a201-3dd41b800b84","block_type":"box","text":"complexity for scope 3 emissions and the lack of direct control by companies over the requisite data, we find it most","page_number":223,"box":{"x":69,"y":726,"width":832,"height":12}},{"id":"fe4172f7-d276-4e2f-9161-e39c5d74a00e","block_type":"box","text":"useful when companies focus their disclosures on those of the fifteen scope 3 GHG Protocol categories that are","page_number":223,"box":{"x":69,"y":742,"width":800,"height":11}},{"id":"a5d6fd94-3f90-4a10-b752-87f143817e9a","block_type":"box","text":"material to their business models.","page_number":223,"box":{"x":69,"y":757,"width":243,"height":9}},{"id":"c8c05d4b-6900-44f5-ab04-70b5c692d81d","block_type":"box","text":"19","page_number":223,"box":{"x":69,"y":775,"width":9,"height":4}},{"id":"feae7746-7cbb-49f9-837b-3df02a825a1f","block_type":"box","text":"International Financial Repor ting Standards, “IFRS S2: Climate-related Disclosures,” June 2023, accessed in","page_number":223,"box":{"x":84,"y":774,"width":777,"height":12}},{"id":"f31de05b-6917-4a72-bb11-036890fd83c8","block_type":"box","text":"December 2025.","page_number":223,"box":{"x":70,"y":790,"width":118,"height":8}},{"id":"34145aad-d3ad-420f-bc44-aefeebfcbf43","block_type":"box","text":"20","page_number":223,"box":{"x":69,"y":807,"width":9,"height":5}},{"id":"0abb79f2-556a-4b64-b631-2cfa511b2f71","block_type":"box","text":"More companies are developing such plans, and public policymakers in cer tain markets are signaling their","page_number":223,"box":{"x":84,"y":807,"width":758,"height":11}},{"id":"8851468d-c808-4ef6-a102-3bf118c2ffb1","block_type":"box","text":"intentions to require them or already have requirements in place, such as Australia, Brazil, and the European Union","page_number":223,"box":{"x":70,"y":822,"width":820,"height":11}},{"id":"732e5741-87a5-4adf-97ea-d268d4099c14","block_type":"box","text":"(please see the International Transition Plan Network for information). BlackRock views transition plans as a method","page_number":223,"box":{"x":69,"y":837,"width":829,"height":11}},{"id":"cb77ad49-5fa4-4e88-86e8-d5a9d48d89aa","block_type":"box","text":"for a company to both internally assess and externally communicate its long-term strategy, ambition, objectives, and","page_number":223,"box":{"x":68,"y":852,"width":829,"height":12}},{"id":"38324920-d93f-42b8-b7ad-bfd994034431","block_type":"box","text":"actions to create financial value through the global transition towards a low-carbon economy. Across the landscape","page_number":223,"box":{"x":69,"y":868,"width":818,"height":11}},{"id":"607cdb59-56fc-4600-b11e-ef23f91e5dd7","block_type":"box","text":"there remains divergence on the objectives of such plans and the details they should contain. 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Given for thcoming regulatory requirements in cer tain jurisdictions, some companies are voluntarily","page_number":224,"box":{"x":101,"y":420,"width":774,"height":11}},{"id":"c5ad3284-decb-47dc-a2e5-81d6f81b11e8","block_type":"box","text":"disclosing scope 3 emissions reductions targets and plans, setting out how they are working on decarbonization","page_number":224,"box":{"x":101,"y":435,"width":800,"height":11}},{"id":"b28e7515-5e5d-471f-966e-116c71545ea9","block_type":"box","text":"with the different constituents in their value chain.","page_number":224,"box":{"x":101,"y":450,"width":358,"height":9}},{"id":"151dee4a-884e-45bc-9614-43fb59bdbdd3","block_type":"box","text":"21","page_number":224,"box":{"x":461,"y":451,"width":9,"height":4}},{"id":"cbfd6634-1e88-4571-9f65-70b2641e4f2b","block_type":"box","text":"•","page_number":224,"box":{"x":69,"y":473,"width":6,"height":5}},{"id":"2ee7c8c9-c54b-4019-9dda-f7240da9c8dc","block_type":"box","text":"The company’s governance and oversight processes for managing material risks associated with corporate","page_number":224,"box":{"x":101,"y":470,"width":761,"height":12}},{"id":"28763d34-1791-4ccc-abd3-d85a040e5722","block_type":"box","text":"political activities including applicable policies and procedures where relevant.","page_number":224,"box":{"x":102,"y":486,"width":556,"height":11}},{"id":"3050aa60-965b-4f6e-9f8b-0c06db3a1ca9","block_type":"box","text":"22","page_number":224,"box":{"x":660,"y":486,"width":8,"height":4}},{"id":"cf2dd08e-3af5-452b-9be7-156012b3c17e","block_type":"box","text":"The dedicated team looks for","page_number":224,"box":{"x":674,"y":486,"width":208,"height":9}},{"id":"f025a60b-9c2f-44f5-8ae3-488c01b5df1a","block_type":"box","text":"public policy engagement to be consistent with a company’s stated strategic policy objectives, including those","page_number":224,"box":{"x":102,"y":501,"width":783,"height":11}},{"id":"9e806428-e381-4bb4-a4f0-6d72f07fb75a","block_type":"box","text":"related to the low-carbon transition.","page_number":224,"box":{"x":102,"y":516,"width":251,"height":9}},{"id":"3f55d1af-3d5b-443a-a7ce-200d838db36e","block_type":"box","text":"Voting against directors over concerns about climate risk","page_number":224,"box":{"x":68,"y":546,"width":420,"height":11}},{"id":"61366250-7486-478d-a92c-6af8916eb272","block_type":"box","text":"In implementing these Guidelines, the dedicated team generally suppor ts non-executive directors standing for","page_number":224,"box":{"x":102,"y":569,"width":781,"height":11}},{"id":"0ba14eb9-dfd2-4f2b-95eb-efdb72ab2437","block_type":"box","text":"election where, in its assessment based on company disclosures and engagement, a company is executing on its","page_number":224,"box":{"x":69,"y":584,"width":811,"height":11}},{"id":"696a359e-8014-4027-8b80-fed44b67e165","block_type":"box","text":"commitment to align with the transition to a low-carbon economy, as defined above. Where the dedicated team","page_number":224,"box":{"x":69,"y":599,"width":788,"height":11}},{"id":"1055db01-ce27-4b38-abd1-42ca7b3a1274","block_type":"box","text":"determines this is not the case, it may vote against the election of one or more directors who the team identifies as","page_number":224,"box":{"x":69,"y":614,"width":828,"height":11}},{"id":"8ba7041a-5d04-4c23-949e-0b19ffe26933","block_type":"box","text":"having the most responsibility for the issue. The directors most likely to be in focus are the chair of the board","page_number":224,"box":{"x":69,"y":629,"width":780,"height":11}},{"id":"0c3ed21e-818e-49fc-beae-ef93b4055fcb","block_type":"box","text":"committee with low-carbon transition, climate or sustainability risk oversight responsibilities, other members of the","page_number":224,"box":{"x":69,"y":644,"width":817,"height":12}},{"id":"93626119-fbcf-4160-80ef-38d15547bcb2","block_type":"box","text":"relevant committee, the lead independent director or the non-executive chair of the board. 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The research uses a definition of materiality from the GHG Protocol,","page_number":224,"box":{"x":69,"y":734,"width":813,"height":11}},{"id":"19a22e26-b696-413a-a077-0ad7df98ccdd","block_type":"box","text":"which “encourages companies to maintain a representative inventory of the “most significant GHG emissions, [that]","page_number":224,"box":{"x":68,"y":749,"width":828,"height":11}},{"id":"89bd4433-5b26-45de-8810-6126286acd56","block_type":"box","text":"offer the most significant GHG reduction oppor tunities and are most relevant to the company’s business goals.”","page_number":224,"box":{"x":69,"y":764,"width":801,"height":12}},{"id":"4dd2d37f-747a-4ce1-96bb-c3eb56f76dca","block_type":"box","text":"Website accessed in December 2025.","page_number":224,"box":{"x":68,"y":779,"width":272,"height":9}},{"id":"e1f143ac-f548-4826-ae84-275ce6919b28","block_type":"box","text":"22","page_number":224,"box":{"x":69,"y":797,"width":9,"height":5}},{"id":"9381146b-f22b-44f6-b45e-fdc6d84515f4","block_type":"box","text":"Corporate political activities may include lobbying as defined by local regulations, policy engagement (including","page_number":224,"box":{"x":84,"y":797,"width":787,"height":11}},{"id":"bc49a48b-1b10-4492-8361-9517d985f5fd","block_type":"box","text":"trade association memberships), and corporate political contributions.","page_number":224,"box":{"x":68,"y":812,"width":500,"height":11}},{"id":"1e4cab4f-bbec-4445-a3e9-cb3a90a02bfb","block_type":"box","text":"23","page_number":224,"box":{"x":69,"y":830,"width":9,"height":5}},{"id":"91e0e8d0-d2a2-4118-a1ef-c7162929fcc4","block_type":"box","text":"Board repor t votes are generally advisory and relate to repor ts issued by the board of directors that may contain","page_number":224,"box":{"x":84,"y":830,"width":801,"height":11}},{"id":"63a05d4b-a39d-4e0e-85d9-46c1002c7744","block_type":"box","text":"information on a company’s sustainability effor ts, operational resilience, or financial condition, among others.","page_number":224,"box":{"x":70,"y":845,"width":782,"height":11}},{"id":"a22a9561-e600-4f09-881c-eef76b762d61","block_type":"box","text":"BlackRock Investment Stewardship","page_number":224,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"e0e04304-fbab-45e1-830b-7f22d970d6bb","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines | 7","page_number":224,"box":{"x":509,"y":942,"width":400,"height":13}},{"id":"0541f2a1-516f-4017-a074-983f1f27601c","block_type":"box","text":"NM1026U-5982568-224/232","page_number":224,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"7d20f40f-d075-4dc3-91bb-e866da556380","block_type":"box","text":"Where the dedicated team has not suppor ted director elections over climate concerns in a prior year, and the","page_number":225,"box":{"x":101,"y":45,"width":780,"height":11}},{"id":"84f3ddbc-2f4b-4f73-8f65-1472f7c0ea65","block_type":"box","text":"company has not subsequently made progress towards aligning with the transition to a low-carbon economy, the team","page_number":225,"box":{"x":69,"y":60,"width":839,"height":11}},{"id":"359b004f-9260-4317-a454-bac8ea701119","block_type":"box","text":"may escalate by not suppor ting the re-election of additional responsible directors.","page_number":225,"box":{"x":69,"y":75,"width":582,"height":11}},{"id":"5c2aa1a3-86c8-47f0-8eeb-27542c826a1d","block_type":"box","text":"24","page_number":225,"box":{"x":653,"y":75,"width":9,"height":5}},{"id":"63c7a368-e2c1-4c85-b4c4-3a82ff1cc657","block_type":"box","text":"Management proposals to approve a climate strategy or progress report","page_number":225,"box":{"x":69,"y":105,"width":528,"height":11}},{"id":"c94596d8-17db-478d-afb4-73371bb64b9b","block_type":"box","text":"In cer tain markets, company management may submit proposals— commonly referred to as “Say on Climate” —","page_number":225,"box":{"x":102,"y":128,"width":807,"height":11}},{"id":"1affacc2-07b2-4a56-9362-1a76fb17592f","block_type":"box","text":"seeking shareholder approval of their climate action plans or progress repor ts. The Guidelines consider these","page_number":225,"box":{"x":69,"y":143,"width":782,"height":11}},{"id":"1caad2f0-73bc-436d-ac35-81b5438eb26c","block_type":"box","text":"proposals as a valuable governance mechanism that can enhance transparency, accountability, and investors’","page_number":225,"box":{"x":70,"y":158,"width":782,"height":11}},{"id":"2994839b-18be-4cf6-8bd8-0bad9f208dd3","block_type":"box","text":"understanding of a company’s climate strategy. The dedicated team generally suppor ts management’s climate","page_number":225,"box":{"x":69,"y":173,"width":787,"height":11}},{"id":"be4f3844-91bf-43d7-8081-6f7529f99665","block_type":"box","text":"strategy proposal if, in the team’s assessment based on these Guidelines, the strategy is aligned with the low-carbon","page_number":225,"box":{"x":69,"y":188,"width":838,"height":12}},{"id":"12398c79-ef11-4e22-905b-15307c142afa","block_type":"box","text":"transition. Similarly, the dedicated team generally suppor ts management’s proposal on a progress repor t if the","page_number":225,"box":{"x":68,"y":203,"width":792,"height":12}},{"id":"f213dac0-14f4-4f1e-8d33-108bcb9294fd","block_type":"box","text":"company has clearly explained its progress against, and any deviations from or changes to, its stated low-carbon","page_number":225,"box":{"x":69,"y":218,"width":803,"height":12}},{"id":"fe4f9ea5-78b4-43c4-be1e-e1a98a8db585","block_type":"box","text":"transition plan and targets.","page_number":225,"box":{"x":68,"y":234,"width":193,"height":11}},{"id":"a6f6cd5a-5736-4f1e-b281-e539cc183498","block_type":"box","text":"Shareholder proposals on climate and low-carbon transition matters","page_number":225,"box":{"x":68,"y":264,"width":495,"height":11}},{"id":"825ac1c6-f5de-4705-9435-621765d433e9","block_type":"box","text":"In most markets, shareholders can submit proposals to be voted on at a company’s shareholder meeting, as","page_number":225,"box":{"x":102,"y":287,"width":777,"height":11}},{"id":"aab19341-c1f7-4602-be5f-eaba2c789532","block_type":"box","text":"long as cer tain requirements are met. 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The dedicated team assesses the implications for, and the relevance to, the","page_number":225,"box":{"x":68,"y":407,"width":770,"height":12}},{"id":"3c173b24-0a05-438b-9696-dcc452b06500","block_type":"box","text":"company’s stated low-carbon transition strategy and targets. Under the Guidelines, the team may suppor t","page_number":225,"box":{"x":69,"y":423,"width":754,"height":11}},{"id":"84f8e58b-2403-4052-af78-5391d8470f52","block_type":"box","text":"shareholder proposals that, for example, ask a company to:","page_number":225,"box":{"x":69,"y":438,"width":425,"height":11}},{"id":"f3512742-5b72-45d2-9be0-161d27d77395","block_type":"box","text":"•","page_number":225,"box":{"x":69,"y":461,"width":6,"height":4}},{"id":"82713d26-e6fe-4df9-94d6-87d1757222eb","block_type":"box","text":"Publish a business plan, and related disclosures, consistent with the ambition to limit average global","page_number":225,"box":{"x":102,"y":458,"width":719,"height":11}},{"id":"89592e33-d542-4aed-b935-5d958437395f","block_type":"box","text":"temperature rise to no more than 1.5°C above pre-industrial levels","page_number":225,"box":{"x":101,"y":473,"width":474,"height":11}},{"id":"b127aca9-4501-46e9-b82f-5ca8220c984c","block_type":"box","text":"•","page_number":225,"box":{"x":69,"y":496,"width":6,"height":5}},{"id":"a2386c55-2d8f-468d-9e42-d22dd2609ada","block_type":"box","text":"Align scope 1 and 2 GHG emissions reduction targets to, and/or discuss how their targets align with, a long-term","page_number":225,"box":{"x":101,"y":493,"width":807,"height":11}},{"id":"6dbe9ef7-99c1-413b-8266-275d44421920","block_type":"box","text":"goal of the company achieving net zero GHG emissions by 2050","page_number":225,"box":{"x":101,"y":508,"width":457,"height":12}},{"id":"1f98d972-185a-4175-a221-1a1df1192621","block_type":"box","text":"•","page_number":225,"box":{"x":69,"y":531,"width":6,"height":5}},{"id":"201f52be-43c6-4146-a3f3-8d15ded2b586","block_type":"box","text":"Disclose the categories of scope 3 GHG emissions most significant to a company’s business model","page_number":225,"box":{"x":102,"y":528,"width":712,"height":12}},{"id":"4b4dbb73-fb6f-4a32-bbb6-b977b72d2f24","block_type":"box","text":"•","page_number":225,"box":{"x":69,"y":551,"width":6,"height":5}},{"id":"0eb62980-ff20-401b-9a52-91a8538e9e9c","block_type":"box","text":"Improve voluntary disclosures on the alignment of a company’s climate-related corporate political activities with","page_number":225,"box":{"x":102,"y":549,"width":794,"height":11}},{"id":"27b1637c-d2aa-41b0-b559-0753581f9a38","block_type":"box","text":"its strategic policy positions, where existing disclosure is insufficient","page_number":225,"box":{"x":102,"y":564,"width":489,"height":11}},{"id":"6ad96538-f519-4821-98bf-6defc6ab1610","block_type":"box","text":"25","page_number":225,"box":{"x":592,"y":564,"width":9,"height":5}},{"id":"1a968f79-9855-4ea7-affb-f98880be3d46","block_type":"box","text":"The dedicated team does not suppor t shareholder proposals that seek to constrain board or management","page_number":225,"box":{"x":101,"y":587,"width":758,"height":11}},{"id":"113b89a1-3937-4e39-b74c-7579306af6d7","block_type":"box","text":"decision-making or direct specific business or strategic decisions.","page_number":225,"box":{"x":69,"y":601,"width":468,"height":12}},{"id":"89cc56df-1650-48ef-8afb-0c64b64beaf3","block_type":"box","text":"RELATED MATTERS","page_number":225,"box":{"x":419,"y":632,"width":140,"height":9}},{"id":"bc60f162-08b2-49e6-bd1f-c41796b628a2","block_type":"box","text":"There are other business items not covered above that may be put to a shareholder vote that could address","page_number":225,"box":{"x":101,"y":655,"width":771,"height":11}},{"id":"6bb6bb95-7988-4b16-9038-8240583ac178","block_type":"box","text":"matters relevant to the transition to a low-carbon economy. Under these Guidelines, the dedicated team engages,","page_number":225,"box":{"x":69,"y":670,"width":808,"height":11}},{"id":"4718045d-3d5a-4068-a7b1-af1107824a16","block_type":"box","text":"where appropriate, to enhance its understanding of a company’s approach. Generally, voting on these matters would","page_number":225,"box":{"x":68,"y":685,"width":831,"height":11}},{"id":"ee6a8a1e-3781-4f38-912f-3264885f8a78","block_type":"box","text":"be covered by BIS’ Benchmark Policies.","page_number":225,"box":{"x":69,"y":700,"width":280,"height":11}},{"id":"9d77a4f5-cc9d-42af-9584-b6c1f9f9b9c9","block_type":"box","text":"Executive compensation","page_number":225,"box":{"x":69,"y":730,"width":177,"height":11}},{"id":"c417aec8-ba63-4622-b1c1-e8952ca42d91","block_type":"box","text":"The dedicated team looks to company boards to put in place a compensation structure that incentivizes and","page_number":225,"box":{"x":101,"y":753,"width":772,"height":11}},{"id":"5f75770d-d057-4e47-ac32-e5aaefbdd279","block_type":"box","text":"rewards executives appropriately. Some companies, in light of their long-term strategy, may decide to include relevant","page_number":225,"box":{"x":69,"y":768,"width":837,"height":11}},{"id":"225caf62-123b-4a49-b172-b39d7f843c36","block_type":"box","text":"GHG emissions reduction targets or low-carbon transition-related metrics in their incentive plans. In such cases, the","page_number":225,"box":{"x":69,"y":783,"width":826,"height":11}},{"id":"9af32a98-65e6-43dd-989a-80335af7e88b","block_type":"box","text":"dedicated team would engage to understand the alignment between those metrics and the company’s stated climate","page_number":225,"box":{"x":69,"y":798,"width":834,"height":11}},{"id":"a960dbd2-f6f9-4ab8-b299-e66d9704ee5a","block_type":"box","text":"24","page_number":225,"box":{"x":69,"y":828,"width":9,"height":4}},{"id":"0c1a2240-0a3c-464a-8f31-c10e013608e4","block_type":"box","text":"While the dedicated team may escalate voting by not suppor ting additional management proposals, principally","page_number":225,"box":{"x":83,"y":827,"width":787,"height":12}},{"id":"332554ad-f27b-457b-87bb-e887cb25d642","block_type":"box","text":"director elections, the team does not consider filing shareholder proposals, preannouncing voting intentions or using","page_number":225,"box":{"x":69,"y":842,"width":832,"height":12}},{"id":"ee00b821-5097-4e5b-9d21-a9c68239d8ab","block_type":"box","text":"the media to amplify concerns as appropriate courses of action. 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Clear disclosure also helps investors assess whether pay structures are consistent with long-term climate","page_number":226,"box":{"x":69,"y":45,"width":821,"height":11}},{"id":"bcc8ed79-f9d5-43f8-9cda-d6815637c009","block_type":"box","text":"strategy and risk management.","page_number":226,"box":{"x":69,"y":60,"width":219,"height":11}},{"id":"75411e75-808e-4315-9e89-1a777ebdf60f","block_type":"box","text":"Auditors and audit-related issues","page_number":226,"box":{"x":68,"y":90,"width":240,"height":9}},{"id":"dfb13838-0ce8-4cc1-9797-a1609690e664","block_type":"box","text":"For companies with material climate or transition risks or oppor tunities in their business models, the dedicated","page_number":226,"box":{"x":102,"y":113,"width":793,"height":11}},{"id":"b4ea33b8-d1dd-4939-ab51-cff81e1e541e","block_type":"box","text":"team is interested in understanding whether the company considers and, if relevant, quantifies, and accounts for","page_number":226,"box":{"x":68,"y":128,"width":807,"height":11}},{"id":"cce8975a-ab70-4a81-a72c-9ddc39833412","block_type":"box","text":"material climate-related risks in its financial statements, including if the company explains such risks within the","page_number":226,"box":{"x":69,"y":143,"width":794,"height":11}},{"id":"e57fb12c-c098-41d0-837c-b206bc22e635","block_type":"box","text":"context of its audit repor t. The team notes that assurance of corporate disclosures related to climate risk and the","page_number":226,"box":{"x":69,"y":158,"width":812,"height":11}},{"id":"3e027fe6-7af9-41e0-b9e3-6870c72c77b5","block_type":"box","text":"transition to a low-carbon economy is still nascent.","page_number":226,"box":{"x":68,"y":173,"width":361,"height":11}},{"id":"a680884f-8510-4835-9ec8-f1d3927702c7","block_type":"box","text":"Mergers, acquisitions, asset sales, and other special situations","page_number":226,"box":{"x":69,"y":203,"width":463,"height":11}},{"id":"e70136e6-2231-4a03-ada5-9e8ad136047e","block_type":"box","text":"Special situations will be considered on their financial merits, but the dedicated team may engage on climate","page_number":226,"box":{"x":102,"y":226,"width":783,"height":11}},{"id":"572370e3-e118-4dec-aae7-080e07f0c49c","block_type":"box","text":"related factors under these Guidelines where a transaction may significantly alter a company’s climate strategy or a","page_number":226,"box":{"x":69,"y":241,"width":824,"height":11}},{"id":"957fcce1-7bc0-4e2c-8dd0-6d8b3dcd3238","block_type":"box","text":"shareholder activist has proposed governance, strategic or operational changes that may impact its climate strategy.","page_number":226,"box":{"x":69,"y":257,"width":831,"height":11}},{"id":"2deaa1d8-91d8-4c88-92b8-8751411d9629","block_type":"box","text":"The dedicated team does not promote changes in corporate control or engage in shareholder activism.","page_number":226,"box":{"x":68,"y":272,"width":731,"height":11}},{"id":"3817ae59-651a-4ea5-8d79-385dc322e13f","block_type":"box","text":"Other business relevant sustainability-related risks and opportunities","page_number":226,"box":{"x":69,"y":302,"width":503,"height":11}},{"id":"9658cd0c-b169-435c-9de9-0e0d7429658a","block_type":"box","text":"Climate risk and the transition to a low-carbon economy are interconnected with a number of other material","page_number":226,"box":{"x":102,"y":324,"width":762,"height":11}},{"id":"f0b31c8d-887b-43ea-b750-d8bdadc1ae4a","block_type":"box","text":"sustainability-related risks and oppor tunities that may be relevant to a company’s business model and long-term","page_number":226,"box":{"x":69,"y":340,"width":802,"height":11}},{"id":"ca551a4c-1810-489d-8bfb-ec83f720b6eb","block_type":"box","text":"financial per formance. These include a company’s impacts or dependencies on natural capital and key","page_number":226,"box":{"x":68,"y":355,"width":734,"height":11}},{"id":"09cb96dd-8d03-4d82-ab37-749d9b217653","block_type":"box","text":"stakeholders.","page_number":226,"box":{"x":69,"y":370,"width":95,"height":9}},{"id":"f1440d94-53f0-426d-8dc4-c6e910798c97","block_type":"box","text":"26","page_number":226,"box":{"x":166,"y":370,"width":9,"height":5}},{"id":"4aacccec-f957-436c-958d-a6223e2a1a7f","block_type":"box","text":"In the context of these Guidelines, the dedicated team may engage companies to better understand","page_number":226,"box":{"x":182,"y":370,"width":710,"height":11}},{"id":"2f626ecb-d8f6-439d-bd17-a2404ec95fb1","block_type":"box","text":"how they are managing the impact on people (e.g., employees, suppliers, customers and communities) of any","page_number":226,"box":{"x":69,"y":385,"width":783,"height":11}},{"id":"3027e27a-9758-4d15-bce9-8553f8aecc0e","block_type":"box","text":"strategic or operational changes they are making in relation to their transition to a low-carbon economy. Similarly, the","page_number":226,"box":{"x":69,"y":400,"width":832,"height":11}},{"id":"9a0d5929-703f-4a0a-975e-6a6e5adf0523","block_type":"box","text":"team may engage companies that face risks and oppor tunities related to land use and deforestation, access to fresh","page_number":226,"box":{"x":68,"y":415,"width":838,"height":11}},{"id":"435882af-974b-4ef9-8f7e-bd348dce1213","block_type":"box","text":"water, or the ability to secure scarce resources critical to the transition to a low-carbon economy.","page_number":226,"box":{"x":68,"y":430,"width":690,"height":11}},{"id":"b8240cd3-802b-48c0-a729-08f79f4b50e7","block_type":"box","text":"26","page_number":226,"box":{"x":69,"y":475,"width":9,"height":4}},{"id":"8ce5ec4c-7b63-4498-896f-1b540f21f9ce","block_type":"box","text":"Engagement with companies on these issues is informed by BIS’ commentaries on natural capital, human capital","page_number":226,"box":{"x":84,"y":474,"width":807,"height":12}},{"id":"05f8c89f-ebca-4887-9724-3ee71fef3d70","block_type":"box","text":"management, and corporate human rights risks, December 2025.","page_number":226,"box":{"x":69,"y":490,"width":468,"height":11}},{"id":"9fe2c229-c3be-4a2d-b687-37a83888aef4","block_type":"box","text":"BlackRock Investment Stewardship","page_number":226,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"7553ee77-fca0-4895-8346-bf3c4fe62ef9","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines | 9","page_number":226,"box":{"x":509,"y":942,"width":400,"height":13}},{"id":"e16e0c28-f7d2-457f-9d05-a2a91b0e6774","block_type":"box","text":"NM1026U-5982568-226/232","page_number":226,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"2632f664-f0c0-4bff-9b83-b150c1f70bc8","block_type":"box","text":"Appendix 1","page_number":227,"box":{"x":68,"y":45,"width":82,"height":11}},{"id":"332d60a9-b924-47a0-a77e-f7ca1ec0f18a","block_type":"box","text":"Terminology","page_number":227,"box":{"x":68,"y":75,"width":87,"height":11}},{"id":"db934a20-2275-44c7-90f0-faf9e7d06e2f","block_type":"box","text":"We understand the key concepts referred to within these Guidelines as follows:","page_number":227,"box":{"x":101,"y":98,"width":565,"height":11}},{"id":"cd01fe75-9d1f-447d-aa13-c98a0d4367b9","block_type":"box","text":"Climate risk:","page_number":227,"box":{"x":101,"y":120,"width":92,"height":9}},{"id":"acb14b19-ac47-4551-a6bb-0879366e8a0f","block_type":"box","text":"Includes physical risk, the increased risk to companies’ assets and activities caused by the direct","page_number":227,"box":{"x":200,"y":120,"width":698,"height":11}},{"id":"b948a03e-aedb-4520-a532-db5cfcf8d9ee","block_type":"box","text":"impact of changing weather patterns and natural catastrophes, and transition risk, the impact of the transition to a","page_number":227,"box":{"x":70,"y":135,"width":818,"height":12}},{"id":"62895a34-f231-48ac-bc09-cbb3d3fa2930","block_type":"box","text":"low-carbon economy on a company’s long-term profitability.","page_number":227,"box":{"x":70,"y":150,"width":416,"height":12}},{"id":"39b3fc8b-f4c6-43fa-9172-5e4fc8f864f1","block_type":"box","text":"Transition to a low-carbon economy (“low-carbon transition”):","page_number":227,"box":{"x":101,"y":173,"width":449,"height":11}},{"id":"cc847591-39a6-42c4-8246-b5d8e1699780","block_type":"box","text":"The global economic shift toward lower","page_number":227,"box":{"x":556,"y":173,"width":278,"height":11}},{"id":"3afbdf8a-2187-44b9-aabe-ee6e41b9e471","block_type":"box","text":"emissions across many sectors and business models. The economic transformation is being driven by changes in","page_number":227,"box":{"x":69,"y":188,"width":811,"height":12}},{"id":"29fa4337-68a4-408a-b7eb-307a7449e513","block_type":"box","text":"government policy, technology, and consumer and investor preferences, as well as the physical effects of climate","page_number":227,"box":{"x":68,"y":203,"width":807,"height":12}},{"id":"743ee4d9-9910-47dd-99fc-fe29528deda8","block_type":"box","text":"change (e.g., extreme weather), and can potentially have a material impact on clients’ investments and por tfolios.","page_number":227,"box":{"x":69,"y":218,"width":812,"height":12}},{"id":"8f75e89c-2dac-4b98-98e3-6db159fb70ad","block_type":"box","text":"Decarbonization:","page_number":227,"box":{"x":102,"y":241,"width":120,"height":9}},{"id":"995f51e4-7752-42b0-8ffd-2d40ad78cbaa","block_type":"box","text":"the process of reducing or eliminating emissions of carbon dioxide (CO2) from human activity","page_number":227,"box":{"x":228,"y":241,"width":664,"height":11}},{"id":"14c3d664-1878-4a38-8f44-4beacf41415b","block_type":"box","text":"and removing carbon currently in the atmosphere. This can be carried out by countries, companies and even","page_number":227,"box":{"x":69,"y":257,"width":771,"height":11}},{"id":"08b04191-1f7b-47b5-9726-2f8d65bb917c","block_type":"box","text":"individual consumers. Sometimes the concept is understood to include the reduction and elimination of other GHG,","page_number":227,"box":{"x":70,"y":271,"width":820,"height":11}},{"id":"0ca29ab5-0f94-427a-b5d0-9d40a09967ea","block_type":"box","text":"e.g., methane.","page_number":227,"box":{"x":69,"y":287,"width":102,"height":11}},{"id":"931a3f31-dcfb-455f-bb89-b7fe7eef2bfe","block_type":"box","text":"Climate-related risks and opportunities:","page_number":227,"box":{"x":101,"y":309,"width":289,"height":11}},{"id":"9b0778f6-c1da-4d7c-af49-9d0a1191122c","block_type":"box","text":"The investment oppor tunities and risks associated with the transition","page_number":227,"box":{"x":396,"y":309,"width":495,"height":11}},{"id":"0ef45326-6ce7-4c6a-aed7-e3f43a59b3d2","block_type":"box","text":"to a low-carbon economy, including transition risks and oppor tunities and physical risks and oppor tunities in adapting","page_number":227,"box":{"x":68,"y":325,"width":838,"height":11}},{"id":"ce807392-682e-4bc1-887b-b289857f7be4","block_type":"box","text":"to physical climate change.","page_number":227,"box":{"x":68,"y":340,"width":193,"height":11}},{"id":"dfd13b75-0d54-49f8-9cf9-77d03cd1d08d","block_type":"box","text":"Climate-related transition plan:","page_number":227,"box":{"x":101,"y":362,"width":226,"height":11}},{"id":"2cdf5c81-f346-424d-97b5-74ff084c0d28","block_type":"box","text":"“An aspect of an entity’s overall strategy that lays out the entity’s targets,","page_number":227,"box":{"x":334,"y":362,"width":525,"height":11}},{"id":"b6406a12-f82d-443b-a736-0edf8a4c4a59","block_type":"box","text":"actions or resources for its transition towards a lower-carbon economy, including actions such as reducing its","page_number":227,"box":{"x":69,"y":377,"width":778,"height":12}},{"id":"ab10ac0d-25d9-4b4e-ae83-5e827fae2577","block_type":"box","text":"greenhouse gas emissions.”","page_number":227,"box":{"x":68,"y":393,"width":203,"height":11}},{"id":"bdc97dcb-757b-43c8-acc3-f9da26ea4340","block_type":"box","text":"27","page_number":227,"box":{"x":273,"y":393,"width":9,"height":4}},{"id":"6037a9bf-1270-4205-8324-460230cef328","block_type":"box","text":"Science-based GHG emissions reduction targets:","page_number":227,"box":{"x":101,"y":415,"width":356,"height":11}},{"id":"116f6d39-8204-4530-a791-0b57ffc5b14e","block_type":"box","text":"Targets that “","page_number":227,"box":{"x":463,"y":415,"width":96,"height":11}},{"id":"2b61f205-9477-4ef6-95c1-f996993e16cf","block_type":"box","text":"are in line with what the latest climate science","page_number":227,"box":{"x":569,"y":415,"width":331,"height":9}},{"id":"19089ea2-332b-4a55-b071-822c7a6c19f7","block_type":"box","text":"deems necessary to meet the goals of the Paris Agreement — limiting global warming to 1.5°C above pre-industrial","page_number":227,"box":{"x":69,"y":430,"width":822,"height":11}},{"id":"895dfcbe-7204-436a-98a2-7c367b938815","block_type":"box","text":"levels. Science-based targets give companies a clearly defined path to reduce GHG emissions in line with limiting","page_number":227,"box":{"x":70,"y":445,"width":806,"height":12}},{"id":"4afeb1ad-804e-4efa-9232-0a103b8195e4","block_type":"box","text":"global warming to 1.5°C. They define how much and how quickly a business must reduce its emissions to be in line","page_number":227,"box":{"x":68,"y":460,"width":824,"height":12}},{"id":"c51d08cb-f2f8-431c-92e9-da8df600dfd7","block_type":"box","text":"with the Paris Agreement goals.”","page_number":227,"box":{"x":68,"y":476,"width":232,"height":11}},{"id":"b4ef7085-acb9-458c-b113-f4f4edebd9c9","block_type":"box","text":"28","page_number":227,"box":{"x":302,"y":476,"width":9,"height":4}},{"id":"e3a8a1b7-ce4c-40b5-bf1e-677c2081bfcf","block_type":"box","text":"Scope 1:","page_number":227,"box":{"x":101,"y":498,"width":63,"height":11}},{"id":"8357c825-f14d-4913-a862-f8dda9eda61a","block_type":"box","text":"Direct GHG emissions. Direct GHG emissions occur from sources that are owned or controlled by the","page_number":227,"box":{"x":172,"y":498,"width":718,"height":11}},{"id":"c56d2217-0564-41b4-8848-5e519af27e5f","block_type":"box","text":"company, for example, emissions from combustion in owned or controlled boilers, furnaces, vehicles, etc.; emissions","page_number":227,"box":{"x":69,"y":513,"width":836,"height":11}},{"id":"2492d584-74af-4e66-aa5e-c941b7d21547","block_type":"box","text":"from chemical production in owned or controlled process equipment.","page_number":227,"box":{"x":68,"y":528,"width":489,"height":11}},{"id":"bceaef24-37ab-40c9-8523-d940429baf1a","block_type":"box","text":"29","page_number":227,"box":{"x":559,"y":529,"width":9,"height":4}},{"id":"0b2e026a-9197-4954-a0a6-3f23ff72a367","block_type":"box","text":"Scope 2","page_number":227,"box":{"x":101,"y":551,"width":59,"height":11}},{"id":"98126835-08f8-4a8e-b6d5-fc50e1701030","block_type":"box","text":": Electricity indirect GHG emissions Scope 2 accounts for GHG emissions from the generation of","page_number":227,"box":{"x":162,"y":551,"width":685,"height":11}},{"id":"92e006b8-1647-41c0-ba08-c2ad67b132f1","block_type":"box","text":"purchased electricity [steam, and heating/cooling] consumed by the company. [It] is defined as electricity [steam,","page_number":227,"box":{"x":70,"y":566,"width":807,"height":11}},{"id":"98314586-ed98-460f-944f-e463bbde3581","block_type":"box","text":"and heating/cooling] that is purchased or otherwise brought into the organizational boundary of the company.","page_number":227,"box":{"x":69,"y":581,"width":781,"height":12}},{"id":"1a553f3b-c40f-47d0-9403-63af665176a2","block_type":"box","text":"30","page_number":227,"box":{"x":852,"y":582,"width":9,"height":4}},{"id":"4673686d-2576-48c1-9f92-1538b259f3d2","block_type":"box","text":"Scope 3:","page_number":227,"box":{"x":101,"y":604,"width":63,"height":11}},{"id":"cbfb7c0a-1dc9-4e34-a326-cfdbf8d7506d","block_type":"box","text":"Other indirect GHG emissions. Scope 3 is an optional repor ting category that allows for the treatment","page_number":227,"box":{"x":171,"y":604,"width":725,"height":11}},{"id":"a52d4a94-ea8b-4481-9231-d1b81f84c17d","block_type":"box","text":"of all other indirect emissions. Scope 3 emissions are a consequence of the activities of the company, but occur","page_number":227,"box":{"x":69,"y":619,"width":803,"height":11}},{"id":"42b08340-51fa-40a1-a721-6c28d4452ba1","block_type":"box","text":"from sources not owned or controlled by the company.","page_number":227,"box":{"x":68,"y":634,"width":386,"height":11}},{"id":"107b40da-40b1-49ac-abb3-821b38a572a3","block_type":"box","text":"31","page_number":227,"box":{"x":456,"y":635,"width":9,"height":4}},{"id":"5256f4e0-cedf-4a88-bb4c-ae30f0d2b74f","block_type":"box","text":"27","page_number":227,"box":{"x":69,"y":679,"width":8,"height":4}},{"id":"4719c91a-9ee6-4500-b43d-f8e203c9d765","block_type":"box","text":"As defined by the International Financial Repor ting Standards, “IFRS S2: Climate-related Disclosures,” June 2023..","page_number":227,"box":{"x":83,"y":679,"width":821,"height":11}},{"id":"c938e752-fa73-417f-abfd-257ce0e8dbef","block_type":"box","text":"Several jurisdictions are basing their own transition plan disclosure frameworks on the IFRS S2 definition. We","page_number":227,"box":{"x":69,"y":694,"width":779,"height":11}},{"id":"c62168b1-ac13-4d59-a8e8-4983dbfdaf2c","block_type":"box","text":"anticipate transition plan disclosure becoming mandatory in an increasing number of jurisdictions over the near term.","page_number":227,"box":{"x":69,"y":709,"width":836,"height":11}},{"id":"5c6137a5-2f7f-4c71-84d7-6308bb15c3f1","block_type":"box","text":"28","page_number":227,"box":{"x":69,"y":727,"width":9,"height":4}},{"id":"8e73ecdf-5aa6-47c8-a49f-7bfcd718ab38","block_type":"box","text":"As defined by the Science Based Targets initiative (SBTi). SBTi “is a corporate climate action organization that","page_number":227,"box":{"x":83,"y":726,"width":785,"height":12}},{"id":"c4df4231-0f31-4d8e-b7ab-0c648618f34d","block_type":"box","text":"enables companies and financial institutions worldwide to play their par t in combating the climate crisis. We develop","page_number":227,"box":{"x":69,"y":742,"width":831,"height":11}},{"id":"330f88fd-fb6a-4331-9392-575fc275da84","block_type":"box","text":"standards, tools and guidance which allow companies to set greenhouse gas (GHG) emissions reductions targets in","page_number":227,"box":{"x":69,"y":757,"width":826,"height":11}},{"id":"9547c6ec-5728-485a-a9db-81feff872a04","block_type":"box","text":"line with what is needed to keep global heating below catastrophic levels and reach net-zero by 2050 at latest.”","page_number":227,"box":{"x":70,"y":772,"width":795,"height":11}},{"id":"0e40c156-621a-44b7-8ffd-a7c32d54e25b","block_type":"box","text":"Source: Science Based Targets initiative, “About Us.” Websites accessed in December 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