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. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8","page_number":4,"box":{"x":350,"y":206,"width":528,"height":9}},{"id":"2da8c3f7-305e-4b26-8c26-ab91224e4da0","block_type":"box","text":"Investment Policies","page_number":4,"box":{"x":117,"y":222,"width":148,"height":9}},{"id":"2fc6fdba-7b97-475e-ab4d-9fc5694aaa2b","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9","page_number":4,"box":{"x":270,"y":221,"width":608,"height":10}},{"id":"55067888-a894-44ca-ad2c-9f3f7ad20956","block_type":"box","text":"Continuous Offering","page_number":4,"box":{"x":117,"y":237,"width":153,"height":12}},{"id":"736c887d-c065-428f-8192-085d22c1a2e6","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 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Registered Public Accounting Firm","page_number":5,"box":{"x":151,"y":537,"width":359,"height":12}},{"id":"7a9f98f1-902f-4dff-aa26-3cac0b8f95d3","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78","page_number":5,"box":{"x":513,"y":537,"width":365,"height":9}},{"id":"fec72ab9-547a-4b01-8933-d5bf2b47e122","block_type":"box","text":"Investors’ Rights","page_number":5,"box":{"x":151,"y":552,"width":127,"height":12}},{"id":"19310380-d14b-49ec-aad1-58f865593a76","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78","page_number":5,"box":{"x":281,"y":552,"width":597,"height":10}},{"id":"01ce1ef7-99ad-4403-ad49-e3a784a41ce6","block_type":"box","text":"Financial Statements","page_number":5,"box":{"x":117,"y":568,"width":160,"height":9}},{"id":"43bb4a91-e83f-4acf-b50c-bc3e190c6c45","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79","page_number":5,"box":{"x":281,"y":568,"width":597,"height":9}},{"id":"f6a58c32-5d0c-4a95-bb03-bdbe99df69d7","block_type":"box","text":"PART II","page_number":5,"box":{"x":117,"y":591,"width":62,"height":9}},{"id":"9653bdd5-2c96-4ac7-b581-ebfc17e79403","block_type":"box","text":"Investment Risks and Considerations","page_number":5,"box":{"x":117,"y":606,"width":281,"height":10}},{"id":"197bd190-34e7-4b4b-8f86-a14096d95fe3","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-1","page_number":5,"box":{"x":405,"y":606,"width":473,"height":10}},{"id":"b0233095-5eb3-4044-8d7b-aac68cc7205f","block_type":"box","text":"Appendix A – Description of Bond Ratings","page_number":5,"box":{"x":116,"y":622,"width":318,"height":12}},{"id":"147f1390-bf86-437a-8e01-b40641564d8d","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1","page_number":5,"box":{"x":441,"y":622,"width":437,"height":9}},{"id":"2d62bb00-6b08-4a2f-b666-8bd74f8c7cf3","block_type":"box","text":"Appendix B – Proxy Voting Policies","page_number":5,"box":{"x":116,"y":638,"width":267,"height":11}},{"id":"1902128d-7f9a-440d-b8d2-17eddd2204d6","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-1","page_number":5,"box":{"x":388,"y":637,"width":490,"height":10}},{"id":"25fd06ab-1965-41d6-abc4-94dd079b2916","block_type":"box","text":"ii","page_number":5,"box":{"x":497,"y":909,"width":5,"height":9}},{"id":"013c3dcf-647b-4b56-a23d-ad1a280e5627","block_type":"box","text":"NM0926U-5926888-5/257","page_number":5,"box":{"x":757,"y":969,"width":145,"height":7}},{"id":"4515753a-77a4-4415-89e4-3fd61911a5ad","block_type":"box","text":"PART I: INFORMATION ABOUT THE","page_number":6,"box":{"x":119,"y":92,"width":686,"height":23}},{"id":"02adfa3a-c0ca-4a1b-bd86-50f4f994ed64","block_type":"box","text":"ISHARES SECURITIZED INCOME","page_number":6,"box":{"x":119,"y":126,"width":639,"height":22}},{"id":"6e12d0ec-14c3-41df-8915-4db0de3343ed","block_type":"box","text":"ACTIVE ETF","page_number":6,"box":{"x":116,"y":159,"width":244,"height":23}},{"id":"aa238c34-d609-4e60-aa15-487c67df5966","block_type":"box","text":"Part I of this Statement of Additional Information (“SAI”) sets forth information about iShares","page_number":6,"box":{"x":117,"y":210,"width":686,"height":12}},{"id":"73b1d45c-0706-441d-a189-583dd11b37a3","block_type":"box","text":"Securitized Income Active ETF (the “Fund”), a series of BlackRock ETF Trust II (the “Trust”). It includes","page_number":6,"box":{"x":116,"y":226,"width":772,"height":12}},{"id":"866d2123-c649-4cb9-b923-685e539a1d60","block_type":"box","text":"information about the Trust’s Board of Trustees (the “Board”), the advisory and management services","page_number":6,"box":{"x":117,"y":241,"width":758,"height":12}},{"id":"2b58729a-2689-4996-bbfe-8b35c236ba50","block_type":"box","text":"provided to and the management fees paid by the Fund and information about other fees applicable to","page_number":6,"box":{"x":117,"y":257,"width":763,"height":12}},{"id":"6a87674d-bb79-459c-8561-a7108fa20ab0","block_type":"box","text":"and services provided to the Fund. This Part I of this SAI should be read in conjunction with the Fund’s","page_number":6,"box":{"x":116,"y":272,"width":767,"height":12}},{"id":"e2eca64d-fbb3-4214-ae1c-b6911aa552c3","block_type":"box","text":"Prospectus and those portions of Part II of this SAI that pertain to the Fund.","page_number":6,"box":{"x":117,"y":288,"width":564,"height":12}},{"id":"27694b6f-b280-4a68-a260-464c89f97021","block_type":"box","text":"General Description of the Fund","page_number":6,"box":{"x":118,"y":338,"width":582,"height":29}},{"id":"7bda8fc7-ca45-4259-8b23-f44766f6921e","block_type":"box","text":"The Fund is managed by BlackRock Fund Advisors (“BFA” or the “Manager”), which is an indirect","page_number":6,"box":{"x":116,"y":390,"width":728,"height":12}},{"id":"8129d52a-67c0-4523-91ed-b0c7485f927c","block_type":"box","text":"majority-owned subsidiary of BlackRock, Inc.","page_number":6,"box":{"x":117,"y":405,"width":337,"height":12}},{"id":"0bb9500f-bd6c-4d5d-b8ae-e60224904a21","block_type":"box","text":"The Fund is the successor to BlackRock Securitized Income Fund (formerly, BlackRock U.S. Mortgage","page_number":6,"box":{"x":116,"y":436,"width":769,"height":12}},{"id":"f309d73e-64ec-4d39-8e62-bc95800c1428","block_type":"box","text":"Portfolio) (the “Predecessor Fund”), a series of Managed Account Series II (the “Predecessor Trust”),","page_number":6,"box":{"x":117,"y":451,"width":755,"height":12}},{"id":"1b85da07-3525-4fb0-ab9e-5448db43dbdd","block_type":"box","text":"as a result of a reorganization that occurred as of the close of trading on the New York Stock","page_number":6,"box":{"x":116,"y":467,"width":693,"height":12}},{"id":"2363766f-af45-4375-bb58-12abc7517b79","block_type":"box","text":"Exchange (the “NYSE”) on January 23, 2026 in which the Fund acquired all of the assets and assumed","page_number":6,"box":{"x":117,"y":482,"width":771,"height":12}},{"id":"404c7359-7dcf-45ec-a646-978045b7b0b6","block_type":"box","text":"certain stated liabilities of the Predecessor Fund.","page_number":6,"box":{"x":116,"y":498,"width":367,"height":9}},{"id":"ea749ac3-d229-4f0f-a99c-a4d8a085f2e2","block_type":"box","text":"The Fund offers and issues shares at its net asset value per share (“NAV”) only in aggregations of a","page_number":6,"box":{"x":116,"y":528,"width":747,"height":12}},{"id":"5b870cd6-d582-4834-8023-49fc92fb5cdc","block_type":"box","text":"specified number of shares (each, a “Creation Unit”), generally in exchange for a specified amount of","page_number":6,"box":{"x":116,"y":544,"width":754,"height":12}},{"id":"ffaa86a5-3792-4069-9ef8-1941fb545c53","block_type":"box","text":"cash. 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The Board reviews the policy and procedures for disclosure of portfolio","page_number":14,"box":{"x":117,"y":118,"width":735,"height":12}},{"id":"0fdc862d-3fe0-40bb-b719-8ccaf86d5e00","block_type":"box","text":"holdings information at least annually.","page_number":14,"box":{"x":117,"y":134,"width":285,"height":12}},{"id":"7d435aeb-6cee-4c4d-b120-d35fd273c4f1","block_type":"box","text":"Investment Policies","page_number":14,"box":{"x":119,"y":185,"width":356,"height":22}},{"id":"6a330d63-4ad0-4ef4-a9a1-5d1cee21fcf8","block_type":"box","text":"The Board has adopted as fundamental policies the following numbered investment policies, which","page_number":14,"box":{"x":116,"y":236,"width":739,"height":12}},{"id":"21cf2d9b-f62a-425b-bc1a-8a4e956a927e","block_type":"box","text":"cannot be changed without the approval of the holders of a majority of the applicable Fund’s","page_number":14,"box":{"x":116,"y":252,"width":688,"height":12}},{"id":"e265ab22-2686-4698-9528-7cb971a2f6df","block_type":"box","text":"outstanding voting securities. A vote of a majority of the outstanding voting securities of the Fund is","page_number":14,"box":{"x":116,"y":267,"width":741,"height":12}},{"id":"0c6a0bf8-f764-4b1d-abc4-f22dc60ea8de","block_type":"box","text":"defined in the Investment Company Act as the lesser of (i) 67% or more of the voting securities present","page_number":14,"box":{"x":116,"y":283,"width":771,"height":12}},{"id":"8030f083-5ccf-4cad-aa6b-e11784fab467","block_type":"box","text":"at a shareholder meeting, if the holders of more than 50% of the outstanding voting securities of the","page_number":14,"box":{"x":116,"y":298,"width":745,"height":12}},{"id":"131c0d90-9d4b-4aff-9033-0204d751057e","block_type":"box","text":"Fund are present or represented by proxy, or (ii) more than 50% of the outstanding voting securities of","page_number":14,"box":{"x":117,"y":314,"width":764,"height":12}},{"id":"0b552277-9cb3-4410-ab0a-f307cf06dedb","block_type":"box","text":"the Fund. The Fund has also adopted certain non-fundamental investment policies. Non-fundamental","page_number":14,"box":{"x":116,"y":329,"width":757,"height":12}},{"id":"cb548b45-ae9e-4d22-87de-adb982dc4f2a","block_type":"box","text":"investment policies may be changed by the Board without shareholder approval.","page_number":14,"box":{"x":117,"y":345,"width":600,"height":12}},{"id":"33774f3d-64ec-459b-8212-ee75e16c4cf9","block_type":"box","text":"Fundamental Investment Policies","page_number":14,"box":{"x":117,"y":375,"width":270,"height":10}},{"id":"81bde284-c4cc-468f-a153-56ecc59e4fc6","block_type":"box","text":"The Fund may not:","page_number":14,"box":{"x":116,"y":399,"width":139,"height":12}},{"id":"ce6c4bd3-ae71-4d13-81c8-569b47979306","block_type":"box","text":"1. Concentrate its investments in a particular industry, as that term is used in the Investment","page_number":14,"box":{"x":118,"y":429,"width":703,"height":12}},{"id":"3bfa27ae-c103-4bbb-923f-ea02910c056a","block_type":"box","text":"Company Act; provided, that the Fund will invest at least 25% of its total assets in non-agency","page_number":14,"box":{"x":150,"y":445,"width":702,"height":12}},{"id":"986e7cf9-149c-4a25-9b62-daf326d6a516","block_type":"box","text":"mortgage-backed securities, which for purposes of this investment restriction the Fund will treat as","page_number":14,"box":{"x":150,"y":460,"width":735,"height":12}},{"id":"c120c2c8-9d84-4039-81a7-cf7afef6cc34","block_type":"box","text":"an industry or group of industries.","page_number":14,"box":{"x":150,"y":476,"width":254,"height":12}},{"id":"dedf7f4b-4325-4477-b4e1-4162fe65e1a7","block_type":"box","text":"2. Borrow money, except as permitted under the Investment Company Act.","page_number":14,"box":{"x":116,"y":499,"width":576,"height":12}},{"id":"efa3eeae-e74e-4269-bfd3-d7e4ad447775","block_type":"box","text":"3. Issue senior securities to the extent such issuance would violate the Investment Company Act.","page_number":14,"box":{"x":116,"y":522,"width":741,"height":12}},{"id":"a3a454e2-7046-45b9-a923-13a163d9a645","block_type":"box","text":"4. Purchase or hold real estate, except the Fund may purchase and hold securities or other","page_number":14,"box":{"x":116,"y":545,"width":697,"height":12}},{"id":"2678ec37-2650-4275-9d16-21d77b248575","block_type":"box","text":"instruments that are secured by, or linked to, real estate or interests therein, securities of REITs,","page_number":14,"box":{"x":150,"y":561,"width":719,"height":12}},{"id":"90fe02be-7f83-4a58-88b7-bc05c7149af2","block_type":"box","text":"mortgage-related securities and securities of issuers engaged in the real estate business, and the","page_number":14,"box":{"x":150,"y":576,"width":729,"height":12}},{"id":"6837434e-b7b7-494e-96a9-2085f72a3bd6","block_type":"box","text":"Fund may purchase and hold real estate as a result of the ownership of securities or other","page_number":14,"box":{"x":151,"y":592,"width":672,"height":12}},{"id":"2fe480a2-795c-4f6d-b18a-61c68ac66c0c","block_type":"box","text":"instruments.","page_number":14,"box":{"x":150,"y":607,"width":96,"height":10}},{"id":"dd519041-c638-4156-8622-454f1af9f178","block_type":"box","text":"5. Underwrite securities issued by others, except to the extent that the sale of portfolio securities by","page_number":14,"box":{"x":116,"y":630,"width":757,"height":12}},{"id":"6d07a07c-dd75-4c73-a979-2e61d4513ead","block_type":"box","text":"the Fund may be deemed to be an underwriting or as otherwise permitted by applicable law.","page_number":14,"box":{"x":150,"y":646,"width":689,"height":12}},{"id":"4f2f3b39-583f-4bd8-a657-cb03ce41b58e","block_type":"box","text":"6. Purchase or sell commodities or commodity contracts, except as permitted by the Investment","page_number":14,"box":{"x":116,"y":669,"width":726,"height":12}},{"id":"c6ed822d-0b72-4079-94a9-4eea4f77b3ef","block_type":"box","text":"Company Act.","page_number":14,"box":{"x":150,"y":684,"width":104,"height":12}},{"id":"16a86da5-8d4e-4b12-bc0f-6cb6e3f97788","block_type":"box","text":"7. Make loans to the extent prohibited by the Investment Company Act.","page_number":14,"box":{"x":116,"y":707,"width":542,"height":13}},{"id":"ff15ba1e-4bbc-412e-ae49-36d82cae82ca","block_type":"box","text":"8. Make any investment inconsistent with the Fund’s classification as a diversified company under","page_number":14,"box":{"x":116,"y":731,"width":742,"height":12}},{"id":"99c507a6-27a1-4460-b67c-11cf16f74880","block_type":"box","text":"the Investment Company Act.","page_number":14,"box":{"x":150,"y":746,"width":219,"height":12}},{"id":"74e3d3da-7fc1-40e2-a7a8-c420481bd3ce","block_type":"box","text":"Notations Regarding the Fund’s Fundamental Investment Policies","page_number":14,"box":{"x":116,"y":777,"width":526,"height":12}},{"id":"d75f0691-7c9e-4620-90c8-c364646f6ad5","block_type":"box","text":"The following notations are not considered to be part of the Fund’s fundamental investment policies","page_number":14,"box":{"x":116,"y":800,"width":737,"height":12}},{"id":"94416113-ce66-438b-82f3-98281f3b99b3","block_type":"box","text":"and are subject to change without shareholder approval.","page_number":14,"box":{"x":116,"y":816,"width":417,"height":12}},{"id":"2a5ff187-e245-45c9-8c15-8481a6a205ff","block_type":"box","text":"With respect to the fundamental policy relating to concentration set forth in (1) above, the Investment","page_number":14,"box":{"x":116,"y":846,"width":753,"height":12}},{"id":"186227af-59d8-40a1-8038-0d0020fcf968","block_type":"box","text":"Company Act does not define what constitutes “concentration” in an industry. The SEC staff has taken","page_number":14,"box":{"x":117,"y":862,"width":763,"height":12}},{"id":"aa231532-017a-4362-9fd5-7cc6a2376a6a","block_type":"box","text":"the position that investment of 25% or more of a fund’s total assets in one or more issuers conducting","page_number":14,"box":{"x":116,"y":877,"width":759,"height":12}},{"id":"5afb8b72-f77e-4b0b-b78b-21c02ce771d2","block_type":"box","text":"9","page_number":14,"box":{"x":496,"y":909,"width":7,"height":9}},{"id":"c40926d6-4e46-4093-84da-5a2aa1a9f05a","block_type":"box","text":"NM0926U-5926888-14/257","page_number":14,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"ed56d44e-eb4f-40a2-b1ec-87d75c9a073f","block_type":"box","text":"their principal activities in the same industry or group of industries constitutes concentration. It is","page_number":15,"box":{"x":116,"y":87,"width":718,"height":12}},{"id":"dec86d24-3206-4ae4-a92d-6cb403f12654","block_type":"box","text":"possible that interpretations of concentration could change in the future. The policy in (1) above will be","page_number":15,"box":{"x":117,"y":102,"width":763,"height":13}},{"id":"9ef03252-d0fc-4cb5-bfa3-93a7596ff34a","block_type":"box","text":"interpreted to refer to concentration as that term may be interpreted from time to time. The policy also","page_number":15,"box":{"x":117,"y":118,"width":757,"height":12}},{"id":"a965de4f-d24e-446c-af29-e40a0fc091d0","block_type":"box","text":"will be interpreted to permit investment without limit in the following: securities of the U.S. government","page_number":15,"box":{"x":116,"y":134,"width":759,"height":12}},{"id":"c37b8737-b720-412d-b0f6-9f6d6e7c30d7","block_type":"box","text":"and its agencies or instrumentalities; securities of state, territory, possession or municipal governments","page_number":15,"box":{"x":116,"y":149,"width":770,"height":12}},{"id":"f971f958-62c0-4bcd-a8a6-37b8955fe9a8","block_type":"box","text":"and their authorities, agencies, instrumentalities or political subdivisions; and repurchase agreements","page_number":15,"box":{"x":116,"y":165,"width":756,"height":12}},{"id":"8190347b-d556-4e20-b260-8f9eeacfb5c3","block_type":"box","text":"collateralized by any such obligations. Accordingly, issuers of the foregoing securities will not be","page_number":15,"box":{"x":116,"y":180,"width":718,"height":12}},{"id":"875a2036-8508-4569-a1b9-01080d512c7a","block_type":"box","text":"considered to be members of any industry. There also will be no limit on investment in issuers","page_number":15,"box":{"x":116,"y":196,"width":701,"height":12}},{"id":"023b4f82-357b-44f6-abb8-7cbd7794ec9e","block_type":"box","text":"domiciled in a single jurisdiction or country. Finance companies will be considered to be in the","page_number":15,"box":{"x":116,"y":211,"width":701,"height":12}},{"id":"afffed21-1679-4866-bda8-ffb006fc3ee2","block_type":"box","text":"industries of their parents if their activities are primarily related to financing the activities of the parents.","page_number":15,"box":{"x":117,"y":227,"width":766,"height":12}},{"id":"63872bcc-4df7-4375-8cda-26122b03a766","block_type":"box","text":"Each foreign government will be considered to be a member of a separate industry. With respect to the","page_number":15,"box":{"x":117,"y":242,"width":769,"height":12}},{"id":"9a168c22-d0a2-4635-afa8-5f5e6b83c1ca","block_type":"box","text":"Fund’s industry classifications, the Fund currently utilizes any one or more of the industry","page_number":15,"box":{"x":117,"y":258,"width":665,"height":12}},{"id":"e7926f0a-f0c2-4819-8186-1addfa5ecc3c","block_type":"box","text":"sub-classifications used by one or more widely recognized market indexes or rating group indexes,","page_number":15,"box":{"x":116,"y":273,"width":739,"height":12}},{"id":"03e24024-59b0-4c55-8f94-aaa8a23d7003","block_type":"box","text":"and/or as defined by Fund management. The policy also will be interpreted to give broad authority to","page_number":15,"box":{"x":116,"y":289,"width":751,"height":12}},{"id":"f0dc2449-96d2-4984-a55d-33b3811d04a0","block_type":"box","text":"the Fund as to how to classify issuers within or among industries.","page_number":15,"box":{"x":116,"y":304,"width":489,"height":12}},{"id":"9e393cbf-dbf6-4231-b069-8518c7794730","block_type":"box","text":"With respect to the fundamental policy relating to borrowing money set forth in (2) above, the","page_number":15,"box":{"x":116,"y":335,"width":694,"height":12}},{"id":"482c5d48-c891-4fa0-8f30-6b9bb176af6c","block_type":"box","text":"Investment Company Act permits the Fund to borrow money in amounts of up to one-third of the","page_number":15,"box":{"x":117,"y":351,"width":719,"height":12}},{"id":"3212e02f-d84e-4044-8a60-de56c279b706","block_type":"box","text":"Fund’s total assets from banks for any purpose, and to borrow up to 5% of the Fund’s total assets from","page_number":15,"box":{"x":117,"y":366,"width":767,"height":12}},{"id":"9ea155fb-19dc-48f6-9258-b16add49f87f","block_type":"box","text":"banks or other lenders for temporary purposes. (The Fund’s total assets include the amounts being","page_number":15,"box":{"x":117,"y":382,"width":740,"height":12}},{"id":"5df10852-796c-4599-a7aa-0d04cd1a4eb4","block_type":"box","text":"borrowed.) To limit the risks attendant to borrowing, the Investment Company Act requires the Fund to","page_number":15,"box":{"x":117,"y":397,"width":763,"height":12}},{"id":"9f5ea640-576c-4e7d-b81f-3641174cdba4","block_type":"box","text":"maintain at all times an “asset coverage” of at least 300% of the amount of its borrowings. Asset","page_number":15,"box":{"x":117,"y":413,"width":718,"height":12}},{"id":"e69518d0-2e7d-4e03-a94c-c43f27962eb6","block_type":"box","text":"coverage means the ratio that the value of the Fund’s total assets (including amounts borrowed),","page_number":15,"box":{"x":116,"y":428,"width":723,"height":12}},{"id":"8a652a15-0b1b-46c6-bc06-94b064b2391a","block_type":"box","text":"minus liabilities other than borrowings, bears to the aggregate amount of all borrowings. Borrowing","page_number":15,"box":{"x":117,"y":444,"width":736,"height":12}},{"id":"35e73e18-a8cc-41ce-88f7-c658c0c6b0d8","block_type":"box","text":"money to increase portfolio holdings is known as “leveraging.” Certain trading practices and","page_number":15,"box":{"x":117,"y":459,"width":683,"height":12}},{"id":"5df469c6-6486-42e1-ba5c-74be68ebd9d3","block_type":"box","text":"investments, such as reverse repurchase agreements, may be considered to be borrowings or involve","page_number":15,"box":{"x":117,"y":475,"width":761,"height":12}},{"id":"edb5bb21-6ad7-485c-b799-686cc9013647","block_type":"box","text":"leverage and thus are subject to the Investment Company Act restrictions. In accordance with Rule","page_number":15,"box":{"x":117,"y":490,"width":739,"height":12}},{"id":"b9900490-a33f-4551-a407-31db452eedd9","block_type":"box","text":"18f-4 under the Investment Company Act, when the Fund engages in reverse repurchase agreements","page_number":15,"box":{"x":118,"y":506,"width":760,"height":12}},{"id":"d39dd67e-1c29-45f9-a906-3316c985b146","block_type":"box","text":"and similar financing transactions, the Fund may either (i) maintain asset coverage of at least 300%","page_number":15,"box":{"x":116,"y":521,"width":745,"height":12}},{"id":"03f70c39-c318-4d81-994f-5a2f223cf545","block_type":"box","text":"with respect to such transactions and any other borrowings in the aggregate, or (ii) treat such","page_number":15,"box":{"x":116,"y":537,"width":696,"height":12}},{"id":"69caad75-86d3-47ce-9917-4891e84b5fa0","block_type":"box","text":"transactions as “derivatives transactions” and comply with Rule 18f-4 with respect to such transactions.","page_number":15,"box":{"x":116,"y":552,"width":771,"height":12}},{"id":"3b830c7b-54fb-4adb-a3ca-1516a72783ef","block_type":"box","text":"Short-term credits necessary for the settlement of securities transactions and arrangements with","page_number":15,"box":{"x":116,"y":568,"width":721,"height":12}},{"id":"e5ba7d79-f86c-4c79-8a26-99eb8955f5db","block_type":"box","text":"respect to securities lending will not be considered to be borrowings under the policy. Practices and","page_number":15,"box":{"x":117,"y":583,"width":742,"height":12}},{"id":"93824b9e-5a36-4d41-83e9-cfd1d3617676","block_type":"box","text":"investments that may involve leverage but are not considered to be borrowings are not subject to the","page_number":15,"box":{"x":117,"y":599,"width":752,"height":12}},{"id":"b5fde591-afbc-4ad4-ae74-d7a7abf2d6b7","block_type":"box","text":"policy.","page_number":15,"box":{"x":117,"y":614,"width":51,"height":12}},{"id":"4f6360fb-4b45-454e-90bd-41bac72456f1","block_type":"box","text":"With respect to the fundamental policy relating to underwriting set forth in (5) above, the Investment","page_number":15,"box":{"x":116,"y":645,"width":744,"height":12}},{"id":"46c5f7d9-cb00-4a0f-b529-fcf3b692575e","block_type":"box","text":"Company Act does not prohibit the Fund from engaging in the underwriting business or from","page_number":15,"box":{"x":117,"y":661,"width":682,"height":12}},{"id":"0e52b598-a6f8-483e-aa4b-b53f6ec029e7","block_type":"box","text":"underwriting the securities of other issuers; in fact, in the case of diversified funds, the Investment","page_number":15,"box":{"x":117,"y":676,"width":724,"height":12}},{"id":"24b24461-1cbb-4a39-9312-b407654b5135","block_type":"box","text":"Company Act permits the Fund to have underwriting commitments of up to 25% of its assets under","page_number":15,"box":{"x":117,"y":692,"width":733,"height":12}},{"id":"0525bb22-e3c2-4e31-885a-eda82fd6123e","block_type":"box","text":"certain circumstances. Those circumstances currently are that the amount of the Fund’s underwriting","page_number":15,"box":{"x":116,"y":707,"width":748,"height":12}},{"id":"507ed8a8-d4b3-4497-8349-03f03c4176c9","block_type":"box","text":"commitments, when added to the value of the Fund’s investments in issuers where the Fund owns","page_number":15,"box":{"x":116,"y":723,"width":730,"height":11}},{"id":"4b49fd70-756e-4efb-b762-f0f6a0f5b49e","block_type":"box","text":"more than 10% of the outstanding voting securities of those issuers, cannot exceed the 25% cap. A","page_number":15,"box":{"x":117,"y":738,"width":737,"height":12}},{"id":"11950578-55c0-454e-8bcb-f4e030c57d08","block_type":"box","text":"fund engaging in transactions involving the acquisition or disposition of portfolio securities may be","page_number":15,"box":{"x":116,"y":754,"width":724,"height":12}},{"id":"9df0aa7c-269d-4326-8f42-9ba552c12ef8","block_type":"box","text":"considered to be an underwriter under the Securities Act of 1933, as amended (the “Securities Act”).","page_number":15,"box":{"x":116,"y":769,"width":744,"height":12}},{"id":"4b5967ec-c7aa-4104-b848-3381c42e246c","block_type":"box","text":"Although it is not believed that the application of the Securities Act provisions described above would","page_number":15,"box":{"x":116,"y":785,"width":748,"height":12}},{"id":"926aa720-da1e-4387-a0eb-cb92a9e1685b","block_type":"box","text":"cause the Fund to be engaged in the business of underwriting, the policy in (5) above will be","page_number":15,"box":{"x":116,"y":800,"width":685,"height":12}},{"id":"d7486482-dd3e-43aa-92b5-159372cffd0d","block_type":"box","text":"interpreted not to prevent the Fund from engaging in transactions involving the acquisition or","page_number":15,"box":{"x":117,"y":816,"width":686,"height":12}},{"id":"49e2f3d5-94ce-482d-9cf1-3bf0a2523ccc","block_type":"box","text":"disposition of portfolio securities, regardless of whether the Fund may be considered to be an","page_number":15,"box":{"x":116,"y":831,"width":698,"height":12}},{"id":"813bb877-08c8-4fdc-a26c-e5446d484588","block_type":"box","text":"underwriter under the Securities Act or is otherwise engaged in the underwriting business to the extent","page_number":15,"box":{"x":117,"y":847,"width":765,"height":12}},{"id":"12e37f81-a4ad-4d79-b968-ca78d187cb4e","block_type":"box","text":"permitted by applicable law.","page_number":15,"box":{"x":117,"y":862,"width":211,"height":12}},{"id":"37c72674-6720-4d10-8cf4-e3138296fb6b","block_type":"box","text":"10","page_number":15,"box":{"x":492,"y":909,"width":16,"height":9}},{"id":"1054485a-7194-4209-bd08-ff3d496351b4","block_type":"box","text":"NM0926U-5926888-15/257","page_number":15,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"bcd5968d-d0f1-421b-b5b8-5c8bb28927fa","block_type":"box","text":"With respect to the fundamental policy relating to lending set forth in (7) above, the Investment","page_number":16,"box":{"x":116,"y":87,"width":706,"height":12}},{"id":"aa5ceba7-edcc-4735-824c-4963975f9d9e","block_type":"box","text":"Company Act does not prohibit the Fund from making loans (including lending its securities); however,","page_number":16,"box":{"x":117,"y":102,"width":763,"height":13}},{"id":"ea356958-0a11-48a3-a4b2-d21193e3d7f5","block_type":"box","text":"SEC staff interpretations currently prohibit funds from lending more than one-third of their total assets","page_number":16,"box":{"x":116,"y":118,"width":757,"height":12}},{"id":"38399f47-8754-4c3f-866a-2e4a064515c8","block_type":"box","text":"(including lending its securities), except through the purchase of debt obligations or the use of","page_number":16,"box":{"x":117,"y":134,"width":699,"height":12}},{"id":"f27861a7-622a-450d-939f-1837388c0d03","block_type":"box","text":"repurchase agreements. In addition, collateral arrangements with respect to options, forward currency","page_number":16,"box":{"x":117,"y":149,"width":760,"height":12}},{"id":"35baa143-cf8a-402e-b3d0-9bc07a01f734","block_type":"box","text":"and futures transactions and other derivative instruments (as applicable), as well as delays in the","page_number":16,"box":{"x":116,"y":165,"width":725,"height":12}},{"id":"e6f5f3b4-f4af-4a4f-90a5-1d0f40cedd99","block_type":"box","text":"settlement of securities transactions, will not be considered loans.","page_number":16,"box":{"x":116,"y":180,"width":493,"height":11}},{"id":"630dda50-fded-480f-a2c7-c16193b836f5","block_type":"box","text":"The Fund is currently classified as a diversified fund under the Investment Company Act. This means","page_number":16,"box":{"x":116,"y":209,"width":756,"height":12}},{"id":"a789f2f2-2014-4d29-b43a-16f2b144a32d","block_type":"box","text":"that the Fund may not purchase securities of an issuer (other than (i) obligations issued or guaranteed","page_number":16,"box":{"x":116,"y":224,"width":763,"height":13}},{"id":"9c511532-6794-49b6-81ca-486416c591c0","block_type":"box","text":"by the U.S. government, its agencies or instrumentalities and (ii) securities of other investment","page_number":16,"box":{"x":117,"y":240,"width":704,"height":12}},{"id":"7e9ee835-27b5-4886-ab86-d1a8b75719a9","block_type":"box","text":"companies) if, with respect to 75% of its total assets, (a) more than 5% of the Fund’s total assets would","page_number":16,"box":{"x":116,"y":255,"width":771,"height":13}},{"id":"c345cf31-28f7-40f6-b95a-17d45393cbf6","block_type":"box","text":"be invested in securities of that issuer or (b) the Fund would hold more than 10% of the outstanding","page_number":16,"box":{"x":117,"y":271,"width":743,"height":12}},{"id":"4449fa43-cd98-4c64-a0c8-798bcd0a051d","block_type":"box","text":"voting securities of that issuer. With respect to the remaining 25% of its total assets, the Fund can","page_number":16,"box":{"x":116,"y":286,"width":731,"height":13}},{"id":"f4e6ebe6-4e9c-4cbe-b71c-5f3d10ffe577","block_type":"box","text":"invest more than 5% of its assets in one issuer. Under the Investment Company Act, the Fund cannot","page_number":16,"box":{"x":117,"y":302,"width":758,"height":12}},{"id":"1ae11497-ddd6-4c06-bc7a-ff5ad564283f","block_type":"box","text":"change its classification from diversified to non-diversified without shareholder approval.","page_number":16,"box":{"x":116,"y":317,"width":658,"height":13}},{"id":"4b6fb6e3-ae0e-49c5-9e77-c2731f2e7bdc","block_type":"box","text":"Non-Fundamental Investment Policies","page_number":16,"box":{"x":117,"y":347,"width":308,"height":9}},{"id":"3ed040dd-9d06-4464-8757-f91db842ee2d","block_type":"box","text":"Under its non-fundamental investment restrictions, which may be changed by the Board without","page_number":16,"box":{"x":117,"y":369,"width":714,"height":12}},{"id":"3b8e2663-4779-4aa4-98ba-814ecddc62dc","block_type":"box","text":"shareholder approval, the Fund may not:","page_number":16,"box":{"x":116,"y":384,"width":308,"height":12}},{"id":"b806460a-7b12-42b1-ab7e-dc768a778121","block_type":"box","text":"a. Purchase securities of other investment companies, except to the extent permitted by the","page_number":16,"box":{"x":116,"y":406,"width":701,"height":12}},{"id":"f83dd5fd-30e3-48c1-99ae-e6058d2faced","block_type":"box","text":"Investment Company Act. As a matter of policy, however, the Fund will not purchase shares of","page_number":16,"box":{"x":151,"y":422,"width":706,"height":12}},{"id":"a81055b8-cb80-454b-b794-0b10dc552164","block_type":"box","text":"any registered open-end investment company or registered unit investment trust, in reliance on","page_number":16,"box":{"x":150,"y":438,"width":710,"height":11}},{"id":"6724a0e5-7a6b-4626-8e75-f46d45b4e930","block_type":"box","text":"Section 12(d)(1)(F) or (G) (the “fund of funds” provisions) of the Investment Company Act, at any","page_number":16,"box":{"x":150,"y":453,"width":723,"height":12}},{"id":"bb935958-da61-4bde-9016-41ba904f1040","block_type":"box","text":"time the Fund has knowledge that its shares are purchased by another investment company","page_number":16,"box":{"x":150,"y":469,"width":689,"height":11}},{"id":"93ceb815-3f79-4b95-a103-85d2e872a33f","block_type":"box","text":"investor in reliance on the provisions of subparagraph (G) of Section 12(d)(1).","page_number":16,"box":{"x":150,"y":484,"width":581,"height":12}},{"id":"46d3b59b-18f2-4a43-89de-bec34d345ca7","block_type":"box","text":"b. Make short sales of securities or maintain a short position, except to the extent permitted by the","page_number":16,"box":{"x":117,"y":506,"width":748,"height":12}},{"id":"49a2e1d8-e53a-4b9b-b405-7812a89cbb4b","block_type":"box","text":"Fund’s Prospectus and SAI, as amended from time to time, and applicable law.","page_number":16,"box":{"x":151,"y":522,"width":592,"height":12}},{"id":"3ccf6479-dc65-4c97-9cde-be36694a1181","block_type":"box","text":"Unless otherwise indicated or with respect to policies adopted pursuant to Rule 35d-1 under the","page_number":16,"box":{"x":117,"y":551,"width":714,"height":12}},{"id":"e9833f00-9f51-4dbc-bd56-ab3bcfb35593","block_type":"box","text":"Investment Company Act, all limitations under the Fund’s fundamental or non-fundamental investment","page_number":16,"box":{"x":117,"y":566,"width":762,"height":12}},{"id":"8a73165a-417e-414d-b85b-20ccf9d891ec","block_type":"box","text":"policies apply only at the time that a transaction is undertaken. Any change in the percentage of the","page_number":16,"box":{"x":117,"y":582,"width":743,"height":12}},{"id":"5e4fc7d0-94a8-4d53-9533-63e9430c624f","block_type":"box","text":"Fund’s assets invested in certain securities or other instruments resulting from market fluctuations or","page_number":16,"box":{"x":117,"y":597,"width":750,"height":12}},{"id":"561c68ed-c21e-42b6-80f7-ad4d6bedc0cf","block_type":"box","text":"other changes in the Fund’s total assets will not require the Fund to dispose of an investment until BFA","page_number":16,"box":{"x":116,"y":613,"width":769,"height":12}},{"id":"9fabc6af-060f-4b8d-b3e2-1352c424029a","block_type":"box","text":"determines that it is practicable to sell or close out the investment without undue market or tax","page_number":16,"box":{"x":116,"y":628,"width":704,"height":12}},{"id":"f72ff998-4b0f-4c4c-9fdf-b8776116a461","block_type":"box","text":"consequences.","page_number":16,"box":{"x":116,"y":646,"width":118,"height":10}},{"id":"9ebba7de-723e-4d2f-8445-fd8872b5c988","block_type":"box","text":"Continuous Offering","page_number":16,"box":{"x":118,"y":691,"width":368,"height":29}},{"id":"0630f9d9-3da7-4ef2-a119-486046681b0d","block_type":"box","text":"The method by which Creation Units are created and traded may raise certain issues under applicable","page_number":16,"box":{"x":116,"y":740,"width":759,"height":12}},{"id":"3000a0d5-f120-4ed9-a63b-817dc2d16743","block_type":"box","text":"securities laws. Because new Creation Units are issued and sold by the Fund on an ongoing basis, at","page_number":16,"box":{"x":116,"y":755,"width":753,"height":12}},{"id":"1c5ad26b-f3b4-46ab-99e4-c2e3415e7584","block_type":"box","text":"any point a “distribution,” as such term is used in the 1933 Act, may occur. Broker-dealers and other","page_number":16,"box":{"x":116,"y":771,"width":743,"height":12}},{"id":"f8f33039-a1ca-4028-8a61-72052825e1d7","block_type":"box","text":"persons are cautioned that some activities on their part may, depending on the circumstances, result in","page_number":16,"box":{"x":117,"y":787,"width":763,"height":11}},{"id":"ea44ecab-35b4-4609-8fc6-5b468d65dd68","block_type":"box","text":"their being deemed participants in a distribution in a manner that could render them statutory","page_number":16,"box":{"x":116,"y":802,"width":688,"height":12}},{"id":"393ce4bc-4bf5-4aed-8bea-20ecf3ee27f9","block_type":"box","text":"underwriters and subject them to the prospectus delivery requirement and liability provisions of the","page_number":16,"box":{"x":117,"y":817,"width":730,"height":12}},{"id":"1c2ae241-a800-49b9-96b8-0694fcda487e","block_type":"box","text":"1933 Act.","page_number":16,"box":{"x":118,"y":833,"width":73,"height":9}},{"id":"6ceeb7c1-80bb-4925-a585-70b3b0f268f3","block_type":"box","text":"For example, a broker-dealer firm or its client may be deemed a statutory underwriter if it takes","page_number":16,"box":{"x":117,"y":862,"width":707,"height":12}},{"id":"40e4e2b2-48c5-4ce6-80ca-d61bd709f44b","block_type":"box","text":"Creation Units after placing an order with the Distributor, breaks them down into constituent shares and","page_number":16,"box":{"x":117,"y":877,"width":771,"height":12}},{"id":"d0a2bfb2-01c3-4142-af8d-844a8ba75431","block_type":"box","text":"11","page_number":16,"box":{"x":492,"y":909,"width":14,"height":9}},{"id":"f20d1c77-9998-47fb-8075-c83561c962fd","block_type":"box","text":"NM0926U-5926888-16/257","page_number":16,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"447dc97b-6b20-47ad-95f5-7a4f58023df4","block_type":"box","text":"sells such shares directly to customers or if it chooses to couple the creation of new shares with an","page_number":17,"box":{"x":116,"y":87,"width":739,"height":12}},{"id":"0f238710-606b-44a7-b720-eed721e0c62f","block_type":"box","text":"active selling effort involving solicitation of secondary market demand for shares. A determination of","page_number":17,"box":{"x":116,"y":102,"width":745,"height":13}},{"id":"d0b496d6-9050-4f57-8ac5-42645f0ab56c","block_type":"box","text":"whether one is an underwriter for purposes of the 1933 Act must take into account all of the facts and","page_number":17,"box":{"x":116,"y":118,"width":757,"height":12}},{"id":"a77d801b-1596-45be-8795-af565262a2d1","block_type":"box","text":"circumstances pertaining to the activities of the broker-dealer or its client in the particular case and the","page_number":17,"box":{"x":116,"y":134,"width":764,"height":12}},{"id":"e852381a-a180-44de-9cb5-8415d81cab1d","block_type":"box","text":"examples mentioned above should not be considered a complete description of all the activities that","page_number":17,"box":{"x":116,"y":149,"width":746,"height":12}},{"id":"a4afb6d6-8599-4ca1-bbea-a45fefdd0eb5","block_type":"box","text":"could lead to a categorization as an underwriter.","page_number":17,"box":{"x":116,"y":165,"width":363,"height":12}},{"id":"e296574f-f149-47a6-9bc6-e4d4e6f5d056","block_type":"box","text":"Broker-dealer firms should also note that dealers who are not “underwriters” but are effecting","page_number":17,"box":{"x":117,"y":196,"width":693,"height":12}},{"id":"0d9c4a07-cd99-45cd-a0c2-8520bd573fb8","block_type":"box","text":"transactions in shares, whether or not participating in the distribution of shares, generally are required","page_number":17,"box":{"x":116,"y":211,"width":760,"height":12}},{"id":"6115b492-e4c2-4565-a176-5e778fbac45c","block_type":"box","text":"to deliver a prospectus. This is because the prospectus delivery exemption in Section 4(a)(3) of the","page_number":17,"box":{"x":116,"y":227,"width":741,"height":12}},{"id":"c276d2a8-24a3-4e6b-80f8-10dff0b457a3","block_type":"box","text":"1933 Act is not available in respect of such transactions as a result of Section 24(d) of the Investment","page_number":17,"box":{"x":118,"y":242,"width":757,"height":12}},{"id":"1d89e567-5b36-4aa7-a331-b716937b9050","block_type":"box","text":"Company Act. Firms that incur a prospectus delivery obligation with respect to shares of the Fund are","page_number":17,"box":{"x":117,"y":258,"width":758,"height":12}},{"id":"9e2295ec-642e-4446-a6df-ae37f8d906ab","block_type":"box","text":"reminded that, pursuant to Rule 153 under the 1933 Act, a prospectus delivery obligation under","page_number":17,"box":{"x":117,"y":273,"width":712,"height":12}},{"id":"aed684e1-5952-4115-95a7-3be13bb534cb","block_type":"box","text":"Section 5(b)(2) of the 1933 Act owed to an exchange member in connection with a sale on the Listing","page_number":17,"box":{"x":116,"y":289,"width":758,"height":12}},{"id":"7387eac6-3265-4195-b543-bf14f0b613a5","block_type":"box","text":"Exchange generally is satisfied by the fact that the prospectus is available at the Listing Exchange","page_number":17,"box":{"x":117,"y":304,"width":732,"height":12}},{"id":"e756670d-b989-4fbd-bd5b-34bbef2cac1e","block_type":"box","text":"upon request. The prospectus delivery mechanism provided in Rule 153 is available only with respect","page_number":17,"box":{"x":117,"y":320,"width":757,"height":12}},{"id":"266c7f7b-ed95-4fcc-a5ce-e3b0de342aba","block_type":"box","text":"to transactions on an exchange.","page_number":17,"box":{"x":116,"y":335,"width":243,"height":12}},{"id":"c3ddd799-794a-4915-9e48-1cdf8db6bd8c","block_type":"box","text":"Management","page_number":17,"box":{"x":119,"y":387,"width":244,"height":29}},{"id":"79f9a514-6504-4d7d-954f-026cc1f35ba9","block_type":"box","text":"Trustees and Officers.","page_number":17,"box":{"x":116,"y":438,"width":176,"height":10}},{"id":"c4fd31a5-d6bb-4c8e-a874-6484b7c7e556","block_type":"box","text":"The Board of Trustees (the “Board”) of the Trust consists of nine individuals","page_number":17,"box":{"x":294,"y":438,"width":571,"height":13}},{"id":"1d40ab40-15f8-4a00-ade2-49404d418391","block_type":"box","text":"(each a “Trustee”), seven of whom are not “interested persons” of the Trust as defined in the","page_number":17,"box":{"x":117,"y":454,"width":691,"height":12}},{"id":"df35f615-ceff-41cc-8fe8-7ba138193342","block_type":"box","text":"Investment Company Act (the “Independent Trustees”). The registered investment companies advised","page_number":17,"box":{"x":117,"y":469,"width":763,"height":13}},{"id":"dfa000b6-638d-4e5c-ac00-cb5e6fbe3e61","block_type":"box","text":"by the Manager or its affiliates (the “BlackRock-advised Funds”) are organized into the BlackRock","page_number":17,"box":{"x":117,"y":485,"width":729,"height":12}},{"id":"52e58aef-7226-4b78-9b71-2387834afa8a","block_type":"box","text":"Multi-Asset Complex, the BlackRock Fixed-Income Complex, and the iShares Complex (each, a","page_number":17,"box":{"x":117,"y":500,"width":716,"height":13}},{"id":"2268788e-31bf-4a70-98e9-84e745b4416b","block_type":"box","text":"“BlackRock Fund Complex”). The Trust is included in the BlackRock Fund Complex referred to as the","page_number":17,"box":{"x":116,"y":516,"width":757,"height":12}},{"id":"24371378-b976-401e-a2e5-c73e008f5692","block_type":"box","text":"BlackRock Fixed-Income Complex. The Trustees also oversee as board members the operations of","page_number":17,"box":{"x":117,"y":531,"width":744,"height":12}},{"id":"2a971ed6-215a-47e3-9b56-524dbd2e37fb","block_type":"box","text":"the other open-end and closed-end registered investment companies included in the BlackRock Fixed","page_number":17,"box":{"x":116,"y":547,"width":761,"height":12}},{"id":"f9d976b2-572d-48c4-8123-e8b9050b37a4","block_type":"box","text":"Income Complex.","page_number":17,"box":{"x":117,"y":562,"width":134,"height":12}},{"id":"7cc3eb78-9daf-42b3-af9a-4afc5687a6c4","block_type":"box","text":"The Board has overall responsibility for the oversight of the Trust and the Fund. The Chair of the Board","page_number":17,"box":{"x":116,"y":593,"width":770,"height":13}},{"id":"1c14a9cb-ec23-4717-b4f6-294245c49bab","block_type":"box","text":"and the Chief Executive Officer are different people. Not only is the Chair of the Board an Independent","page_number":17,"box":{"x":116,"y":609,"width":765,"height":12}},{"id":"47f1b6ed-3e2d-4e83-9977-09bfa7a8f5fa","block_type":"box","text":"Trustee, but also the Chair of each Board committee (each, a “Committee”) is an Independent Trustee.","page_number":17,"box":{"x":116,"y":624,"width":768,"height":13}},{"id":"40de0cc4-4c3c-4faf-8db1-f401f9f4d85e","block_type":"box","text":"The Board has seven standing Committees: an Audit Committee, a Governance and Nominating","page_number":17,"box":{"x":116,"y":640,"width":722,"height":12}},{"id":"6fa91a61-c2e3-4365-9489-2493812fc819","block_type":"box","text":"Committee, a Compliance Committee, a Performance Oversight Committee, a Securities Lending","page_number":17,"box":{"x":117,"y":655,"width":728,"height":13}},{"id":"a7d86e87-0873-4657-9974-9af5c76b51ce","block_type":"box","text":"Committee, an Executive Committee and a Private Assets Committee. The role of the Chair of the","page_number":17,"box":{"x":117,"y":671,"width":726,"height":11}},{"id":"86d36ad6-eeef-43b9-a815-a9e516008ad6","block_type":"box","text":"Board is to preside over all meetings of the Board and to act as a liaison with service providers,","page_number":17,"box":{"x":117,"y":686,"width":705,"height":13}},{"id":"e3dc3030-9fee-40f9-bf56-51d085f13d17","block_type":"box","text":"officers, attorneys, and other Trustees between meetings. The Chair of each Committee performs a","page_number":17,"box":{"x":116,"y":702,"width":739,"height":12}},{"id":"78710f9d-8002-4668-8cbd-948fb72a2f18","block_type":"box","text":"similar role with respect to the Committee. The Chair of the Board or a Committee may also perform","page_number":17,"box":{"x":116,"y":717,"width":742,"height":13}},{"id":"2527abde-b1b4-44fb-b342-c541e40c344a","block_type":"box","text":"such other functions as may be delegated by the Board or the Committee from time to time. The","page_number":17,"box":{"x":116,"y":733,"width":714,"height":12}},{"id":"d5173f4d-c9dc-46be-ab00-248254934fbe","block_type":"box","text":"Independent Trustees meet regularly outside the presence of the Fund’s management, in executive","page_number":17,"box":{"x":117,"y":748,"width":737,"height":13}},{"id":"bdacf8dc-42f4-423c-bcfa-25bbe752bc35","block_type":"box","text":"sessions or with other service providers to the Fund. The Board has regular meetings five times a year,","page_number":17,"box":{"x":116,"y":764,"width":765,"height":12}},{"id":"b8f60790-5440-4cfb-b653-8e8c040c5927","block_type":"box","text":"including a meeting to consider the approval of the Fund’s investment management agreement, and, if","page_number":17,"box":{"x":117,"y":780,"width":760,"height":12}},{"id":"175c1f2c-32bd-4b47-a377-d28de87b205e","block_type":"box","text":"necessary, may hold special meetings before its next regular meeting. The Audit Committee, the","page_number":17,"box":{"x":117,"y":795,"width":715,"height":12}},{"id":"681ac174-830b-4c3b-878c-5467d19fa2a8","block_type":"box","text":"Governance and Nominating Committee, the Compliance Committee, the Performance Oversight","page_number":17,"box":{"x":117,"y":811,"width":722,"height":12}},{"id":"0e3ae6a6-c3f2-4799-a409-2df2b0c5803e","block_type":"box","text":"Committee, the Securities Lending Committee and the Private Assets Committee each meets regularly","page_number":17,"box":{"x":117,"y":826,"width":767,"height":12}},{"id":"acfc412a-5c87-4363-b8d2-0a3af29d1247","block_type":"box","text":"and the Executive Committee meets on an ad hoc basis to conduct the oversight functions delegated","page_number":17,"box":{"x":116,"y":842,"width":755,"height":12}},{"id":"586ee02b-d78f-44a1-b471-5f80e25da5b0","block_type":"box","text":"to that Committee by the Board and reports its findings to the Board. The Board and each standing","page_number":17,"box":{"x":116,"y":857,"width":738,"height":12}},{"id":"b07f8f6d-69ff-447d-81ea-9f0f846b509a","block_type":"box","text":"Committee conduct annual assessments of their oversight function and structure. The Board has","page_number":17,"box":{"x":117,"y":873,"width":722,"height":12}},{"id":"53cc78a8-d9bc-4c4e-8050-eb203e859b2f","block_type":"box","text":"12","page_number":17,"box":{"x":492,"y":909,"width":16,"height":9}},{"id":"5cb0149d-25cd-4bc8-998c-41dda41e6054","block_type":"box","text":"NM0926U-5926888-17/257","page_number":17,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"bb8156cb-db94-4032-a7ef-dbd5bea2771b","block_type":"box","text":"determined that the Board’s leadership structure is appropriate because it allows the Board to exercise","page_number":18,"box":{"x":116,"y":87,"width":767,"height":12}},{"id":"40a68305-06dd-4efb-b0b3-c25de18612ad","block_type":"box","text":"independent judgment over management and to allocate areas of responsibility among Committees","page_number":18,"box":{"x":117,"y":102,"width":742,"height":13}},{"id":"c35a933a-4ddc-4bb2-bb1b-50af4cbb7d90","block_type":"box","text":"and the Board to enhance oversight.","page_number":18,"box":{"x":116,"y":118,"width":276,"height":12}},{"id":"bfae71e4-5a27-4f6d-b73a-3807171467df","block_type":"box","text":"The Board decided to separate the roles of Chief Executive Officer from the Chair because it believes","page_number":18,"box":{"x":116,"y":145,"width":759,"height":12}},{"id":"a7ed4e0d-ddd4-49c0-bdfa-42532c16570b","block_type":"box","text":"that having an independent Chair:","page_number":18,"box":{"x":116,"y":161,"width":257,"height":12}},{"id":"0e9498e1-32d6-473d-b7b5-92e10fcb1f0f","block_type":"box","text":"• increases the independent oversight of the Fund and enhances the Board’s objective","page_number":18,"box":{"x":150,"y":188,"width":669,"height":12}},{"id":"b6fc33b0-c28b-456c-bf65-cc18f62e7c19","block_type":"box","text":"evaluation of the Chief Executive Officer;","page_number":18,"box":{"x":184,"y":204,"width":308,"height":11}},{"id":"6a7d7c41-9a82-4d5e-8f87-66575c8c3099","block_type":"box","text":"• allows the Chief Executive Officer to focus on the Fund’s operations instead of Board","page_number":18,"box":{"x":150,"y":225,"width":669,"height":12}},{"id":"f488eeef-5a74-456f-9ffe-eced7ad7d69c","block_type":"box","text":"administration;","page_number":18,"box":{"x":184,"y":241,"width":113,"height":11}},{"id":"d82fa86c-ee7f-4244-baf2-77c2b8865eba","block_type":"box","text":"• provides greater opportunities for direct and independent communication between","page_number":18,"box":{"x":150,"y":262,"width":647,"height":12}},{"id":"f557f76b-cfaf-41d1-80b8-7be71b23f773","block_type":"box","text":"shareholders and the Board; and","page_number":18,"box":{"x":184,"y":278,"width":249,"height":11}},{"id":"235b6070-209f-4c03-bc5d-73002c61a5bd","block_type":"box","text":"• provides an independent spokesman for the Fund.","page_number":18,"box":{"x":150,"y":299,"width":413,"height":12}},{"id":"61116909-f63c-4f0c-b5ac-935c684bdc47","block_type":"box","text":"The Board has engaged the Manager to manage the Fund on a day-to-day basis. The Board is","page_number":18,"box":{"x":116,"y":327,"width":710,"height":12}},{"id":"0bdbc6e6-7397-4017-b2c4-0360a20cc7f8","block_type":"box","text":"responsible for overseeing the Manager, sub-advisers, other service providers, the operations of the","page_number":18,"box":{"x":117,"y":342,"width":747,"height":12}},{"id":"3498c0b5-2e61-41d9-8d49-3491f2afec42","block_type":"box","text":"Fund and associated risks in accordance with the provisions of the Investment Company Act, state","page_number":18,"box":{"x":117,"y":358,"width":737,"height":12}},{"id":"1cf0d5b8-1813-4f87-9e73-52707a482371","block_type":"box","text":"law, other applicable laws, the Fund’s charter, and the Fund’s investment objective and strategies. The","page_number":18,"box":{"x":117,"y":373,"width":767,"height":12}},{"id":"fc5df75d-f650-4515-a0a7-b159e13afe27","block_type":"box","text":"Board reviews, on an ongoing basis, the Fund’s performance, operations, and investment strategies","page_number":18,"box":{"x":117,"y":389,"width":746,"height":12}},{"id":"730baf8f-c52b-43f7-b04b-abca01c19324","block_type":"box","text":"and techniques. The Board also conducts reviews of the Manager and its role in running the operations","page_number":18,"box":{"x":116,"y":404,"width":771,"height":12}},{"id":"de1ce610-82cd-423e-8742-592b3d048d51","block_type":"box","text":"of the Fund.","page_number":18,"box":{"x":116,"y":420,"width":94,"height":9}},{"id":"727fd6da-3113-4fcf-b8b5-15a591a10116","block_type":"box","text":"Day-to-day risk management with respect to the Fund is the responsibility of the Manager,","page_number":18,"box":{"x":117,"y":447,"width":673,"height":12}},{"id":"e73d9a0a-7801-4e32-b045-1115fe7240ce","block_type":"box","text":"sub-advisers or other service providers (depending on the nature of the risk), subject to the supervision","page_number":18,"box":{"x":116,"y":462,"width":770,"height":13}},{"id":"3d16b4fd-c68d-4ff5-bfb1-f9e05b06aeba","block_type":"box","text":"of the Manager. The Fund is subject to a number of risks, including investment, compliance,","page_number":18,"box":{"x":116,"y":478,"width":688,"height":12}},{"id":"850bdd1f-9d1c-4faf-8ee5-1d7e6b51a51d","block_type":"box","text":"operational and valuation risks, among others. While there are a number of risk management functions","page_number":18,"box":{"x":116,"y":493,"width":768,"height":13}},{"id":"441cbb21-9791-4f85-a80b-4445e14eecf6","block_type":"box","text":"performed by the Manager, sub-advisers or other service providers, as applicable, it is not possible to","page_number":18,"box":{"x":117,"y":509,"width":757,"height":12}},{"id":"4383138f-184d-4757-a795-30a579a839e4","block_type":"box","text":"eliminate all of the risks applicable to the Fund. Risk oversight is part of the Board’s general oversight","page_number":18,"box":{"x":116,"y":524,"width":757,"height":13}},{"id":"4c6dd9b8-2b3f-4dd5-b520-a8ecf4606f22","block_type":"box","text":"of the Fund and is addressed as part of various Board and Committee activities. The Board, directly or","page_number":18,"box":{"x":116,"y":540,"width":764,"height":12}},{"id":"21e5aa47-7150-45f9-abc0-8e9ff7593d68","block_type":"box","text":"through Committees, also reviews reports from, among others, management, the independent","page_number":18,"box":{"x":116,"y":555,"width":704,"height":13}},{"id":"4fcb1394-cacd-4e8a-b9bc-c0afd7ce8f74","block_type":"box","text":"registered public accounting firm for the Fund, the Manager, sub-advisers and internal auditors for the","page_number":18,"box":{"x":117,"y":571,"width":760,"height":12}},{"id":"d1f0429a-ff23-4ac6-a452-6cbd31682f44","block_type":"box","text":"Manager or its affiliates, as appropriate, regarding risks faced by the Fund and management’s or the","page_number":18,"box":{"x":117,"y":586,"width":749,"height":13}},{"id":"2a60519f-6c89-4f49-9508-50a15a44ffab","block_type":"box","text":"service provider’s risk functions. The Committee system facilitates the timely and efficient","page_number":18,"box":{"x":116,"y":602,"width":668,"height":12}},{"id":"94d38eb0-e19c-4037-b13a-aa549037fb03","block_type":"box","text":"consideration of matters by the Trustees and facilitates effective oversight of compliance with legal and","page_number":18,"box":{"x":116,"y":617,"width":769,"height":13}},{"id":"1f82c3c5-e17d-4f4b-930f-ad6bf9071727","block_type":"box","text":"regulatory requirements and of the Fund’s activities and associated risks. The Board has approved the","page_number":18,"box":{"x":117,"y":633,"width":765,"height":12}},{"id":"1fd807b4-a413-4859-af60-43cbb8ceded8","block_type":"box","text":"appointment of a Chief Compliance Officer (“CCO”), who oversees the implementation and testing of","page_number":18,"box":{"x":116,"y":648,"width":752,"height":13}},{"id":"ca6a4c79-a112-4a6f-bed5-52ca8253de6c","block_type":"box","text":"the Fund’s compliance program and reports regularly to the Board regarding compliance matters for","page_number":18,"box":{"x":116,"y":664,"width":742,"height":12}},{"id":"5f5f49e2-96a0-4b29-aed4-7268076a238e","block_type":"box","text":"the Fund and its service providers. The Independent Trustees have engaged independent legal","page_number":18,"box":{"x":116,"y":680,"width":707,"height":12}},{"id":"0d97552a-db99-4925-a219-4a8c80b2c567","block_type":"box","text":"counsel to assist them in performing their oversight responsibilities.","page_number":18,"box":{"x":116,"y":695,"width":498,"height":12}},{"id":"015090aa-0be2-4601-bcb0-6ca8f2070e86","block_type":"box","text":"Audit Committee","page_number":18,"box":{"x":115,"y":722,"width":125,"height":10}},{"id":"23b79265-9afc-4b2a-898a-a2e8deb6c57c","block_type":"box","text":". The Board has a standing Audit Committee composed of Lorenzo A. Flores (Chair),","page_number":18,"box":{"x":242,"y":722,"width":627,"height":13}},{"id":"8aef780a-3194-4374-9ffe-9f821b358476","block_type":"box","text":"J. Phillip Holloman and Arthur P. Steinmetz all of whom are Independent Trustees. The principal","page_number":18,"box":{"x":116,"y":738,"width":713,"height":12}},{"id":"d679a4c4-2a81-4009-be9c-1218cf6372fa","block_type":"box","text":"responsibilities of the Audit Committee are to assist the Board in fulfilling its oversight responsibilities","page_number":18,"box":{"x":117,"y":753,"width":746,"height":13}},{"id":"0fac3f14-8604-4f19-96f4-815c3f31dd4c","block_type":"box","text":"relating to the accounting and financial reporting policies and practices of the Fund. The Audit","page_number":18,"box":{"x":117,"y":769,"width":694,"height":12}},{"id":"651706a2-0f23-46ee-acb7-3993e481be20","block_type":"box","text":"Committee’s responsibilities include, without limitation: (i) approving, and recommending to the full","page_number":18,"box":{"x":117,"y":784,"width":727,"height":13}},{"id":"3a124412-1000-4673-b14c-aae0c0264212","block_type":"box","text":"Board for approval, the selection, retention, termination and compensation of the Fund’s independent","page_number":18,"box":{"x":117,"y":800,"width":750,"height":12}},{"id":"93421a22-1299-4868-ab36-668ba45fa673","block_type":"box","text":"registered public accounting firm (the “Independent Registered Public Accounting Firm”) and","page_number":18,"box":{"x":117,"y":815,"width":684,"height":13}},{"id":"5b2ef33e-abea-409f-a908-4472277d2385","block_type":"box","text":"evaluating the independence and objectivity of the Independent Registered Public Accounting Firm;","page_number":18,"box":{"x":116,"y":831,"width":743,"height":12}},{"id":"b8f1ca9c-420d-4c5e-83f3-5e40e941ada4","block_type":"box","text":"(ii) approving all audit engagement terms and fees for the Fund; (iii) reviewing the conduct and results","page_number":18,"box":{"x":117,"y":846,"width":759,"height":13}},{"id":"c3c7f9de-7380-46d9-b872-b837b73d1cd6","block_type":"box","text":"of each audit; (iv) reviewing any issues raised by the Fund’s Independent Registered Public","page_number":18,"box":{"x":116,"y":862,"width":684,"height":12}},{"id":"0c9890a3-9f11-478f-a5fb-d8e156bade41","block_type":"box","text":"Accounting Firm or management regarding the accounting or financial reporting policies and practices","page_number":18,"box":{"x":116,"y":877,"width":761,"height":13}},{"id":"7dfc554a-b28d-4c66-9b84-b029bf543396","block_type":"box","text":"13","page_number":18,"box":{"x":492,"y":909,"width":16,"height":9}},{"id":"dbf0b862-9c8a-42f0-bd0f-ecdacb0e8302","block_type":"box","text":"NM0926U-5926888-18/257","page_number":18,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"a2c2be60-a0d7-45b1-bb08-64b2c6c76d49","block_type":"box","text":"of the Fund, its internal controls, and, as appropriate, the internal controls of certain service providers","page_number":19,"box":{"x":116,"y":87,"width":756,"height":12}},{"id":"6c22b57e-e990-49f1-bdc5-a4622c42a4a2","block_type":"box","text":"and management’s response to any such issues; (v) reviewing and discussing the Fund’s audited and","page_number":19,"box":{"x":116,"y":102,"width":761,"height":13}},{"id":"fbc0fc8f-6077-47ea-bbc4-d0621f4abdcb","block_type":"box","text":"unaudited financial statements and disclosure in the Fund’s shareholder reports relating to the Fund’s","page_number":19,"box":{"x":117,"y":118,"width":757,"height":12}},{"id":"4fce0286-614e-4e0c-9956-6e35161fea5f","block_type":"box","text":"performance; (vi) assisting the Board’s responsibilities with respect to the internal controls of the Fund","page_number":19,"box":{"x":117,"y":134,"width":760,"height":12}},{"id":"82469db9-3b82-457e-8083-ef8265e90e39","block_type":"box","text":"and its service providers with respect to accounting and financial matters; and (vii) resolving any","page_number":19,"box":{"x":116,"y":149,"width":718,"height":12}},{"id":"0fb4dae9-030a-451d-a006-311bef8de978","block_type":"box","text":"disagreements between the Fund’s management and the Fund’s Independent Registered Public","page_number":19,"box":{"x":116,"y":165,"width":720,"height":12}},{"id":"e1bb98fc-422f-48e2-bdbe-7833546be5f4","block_type":"box","text":"Accounting Firm regarding financial reporting. The Board has adopted a written charter for the Board’s","page_number":19,"box":{"x":116,"y":180,"width":764,"height":12}},{"id":"db9487f7-3310-4b62-8f57-3f71b029afb2","block_type":"box","text":"Audit Committee. During the fiscal year ended April 30,","page_number":19,"box":{"x":116,"y":196,"width":414,"height":12}},{"id":"f721213b-19a1-4f34-91f1-92e339da13a7","block_type":"box","text":"2026, the Audit Committee met 4 times.","page_number":19,"box":{"x":531,"y":196,"width":300,"height":11}},{"id":"4c8a236b-3212-4bde-982a-bb7c8294763f","block_type":"box","text":"Governance and Nominating Committee","page_number":19,"box":{"x":117,"y":227,"width":298,"height":12}},{"id":"29b98f79-a438-4e6f-bc7b-fe846ad962b2","block_type":"box","text":". The Board has a standing Governance and Nominating","page_number":19,"box":{"x":417,"y":227,"width":425,"height":12}},{"id":"8182c63b-1bf7-45c7-bb0f-8ad3f1481b5c","block_type":"box","text":"Committee composed of W. Carl Kester (Chair), Cynthia L. Egan, J. Phillip Holloman and R. Glenn","page_number":19,"box":{"x":117,"y":242,"width":737,"height":12}},{"id":"dccb0d24-df9e-41a1-aeb5-1ba5db56c602","block_type":"box","text":"Hubbard, all of whom are Independent Trustees. The principal responsibilities of the Governance and","page_number":19,"box":{"x":117,"y":258,"width":757,"height":11}},{"id":"e79d1801-a06d-4473-822d-9fc8b1f6e72e","block_type":"box","text":"Nominating Committee are: (i) identifying individuals qualified to serve as Independent Trustees and","page_number":19,"box":{"x":117,"y":273,"width":747,"height":12}},{"id":"4a146972-0055-4c91-b2f2-548c5e719b52","block_type":"box","text":"recommending Board nominees that are not “interested persons” of the Fund (as defined in the","page_number":19,"box":{"x":117,"y":289,"width":710,"height":12}},{"id":"e32b723e-867c-4318-9ef7-86898b0bb3d1","block_type":"box","text":"Investment Company Act) for election by shareholders or appointment by the Board; (ii) advising the","page_number":19,"box":{"x":117,"y":304,"width":748,"height":12}},{"id":"96a68575-dba6-4c1e-a97e-a5fb5ac9e396","block_type":"box","text":"Board with respect to Board composition, procedures and Committees of the Board (other than the","page_number":19,"box":{"x":117,"y":320,"width":737,"height":12}},{"id":"9c089125-23e7-4cbc-8101-31bc57f759ec","block_type":"box","text":"Audit Committee); (iii) overseeing periodic self-assessments of the Board and Committees of the Board","page_number":19,"box":{"x":116,"y":335,"width":772,"height":12}},{"id":"806503b3-e473-4cdd-a2b7-d39296941037","block_type":"box","text":"(other than the Audit Committee); (iv) reviewing and making recommendations in respect to","page_number":19,"box":{"x":117,"y":351,"width":683,"height":12}},{"id":"2ad71e37-a052-4131-b1b1-b98f8620c66e","block_type":"box","text":"Independent Trustee compensation; (v) monitoring corporate governance matters and making","page_number":19,"box":{"x":117,"y":366,"width":702,"height":12}},{"id":"ea800102-0cf0-403e-9578-aa404299db4f","block_type":"box","text":"recommendations in respect thereof to the Board; (vi) acting as the administrative committee with","page_number":19,"box":{"x":117,"y":382,"width":727,"height":12}},{"id":"5fe029e7-102f-4426-b0db-025d7ff19319","block_type":"box","text":"respect to Board policies and procedures, committee policies and procedures (other than the Audit","page_number":19,"box":{"x":117,"y":397,"width":736,"height":12}},{"id":"300ce7c7-07b1-4554-9a6c-ad0f63bf9b1c","block_type":"box","text":"Committee) and codes of ethics as they relate to the Independent Trustees; and (vii) reviewing and","page_number":19,"box":{"x":117,"y":413,"width":739,"height":12}},{"id":"aa377be2-5a40-460f-a6ab-95c7cdc7d87e","block_type":"box","text":"making recommendations to the Board in respect of Fund share ownership by the Independent","page_number":19,"box":{"x":117,"y":428,"width":709,"height":12}},{"id":"f744c997-827c-4a92-8f3e-54b0a8a5ba1f","block_type":"box","text":"Trustees. The Board has adopted a written charter for the Board’s Governance and Nominating","page_number":19,"box":{"x":116,"y":444,"width":714,"height":12}},{"id":"f0a77de3-9e9e-4723-a71c-6ad425af7cdb","block_type":"box","text":"Committee. During the fiscal year ended April 30, 2026, the Governance and Nominating Committee","page_number":19,"box":{"x":117,"y":459,"width":750,"height":12}},{"id":"bf7d571e-caeb-4d9d-ac2a-9551bb288d8b","block_type":"box","text":"met 4 times.","page_number":19,"box":{"x":117,"y":475,"width":95,"height":9}},{"id":"d3f6bfcf-6352-4f56-8f58-991a280fad1c","block_type":"box","text":"The Governance and Nominating Committee of the Board seeks to identify individuals to serve on the","page_number":19,"box":{"x":116,"y":506,"width":759,"height":12}},{"id":"d553ca56-002a-48c9-869e-bb1d36fc7277","block_type":"box","text":"Board who have a diverse range of viewpoints, qualifications, experiences, backgrounds and skill sets","page_number":19,"box":{"x":117,"y":521,"width":761,"height":12}},{"id":"76c9caac-32b0-476e-9856-52143cb54966","block_type":"box","text":"so that the Board will be better suited to fulfill its responsibility of overseeing the Fund’s activities. In so","page_number":19,"box":{"x":116,"y":537,"width":766,"height":12}},{"id":"4f3bb63d-3b28-4844-a601-b804f82b6cd0","block_type":"box","text":"doing, the Governance and Nominating Committee reviews the size of the Board, the ages of the","page_number":19,"box":{"x":116,"y":552,"width":725,"height":12}},{"id":"ed6004a0-c407-47b7-a9d2-a227b2d37bab","block_type":"box","text":"current Trustees and their tenure on the Board, and the skills, background and experiences of the","page_number":19,"box":{"x":116,"y":568,"width":730,"height":12}},{"id":"a75c2a0f-9d80-4e48-a3cf-986f795b5122","block_type":"box","text":"Trustees in light of the issues facing the Fund in determining whether one or more new trustees should","page_number":19,"box":{"x":116,"y":583,"width":768,"height":12}},{"id":"f5632e14-98a2-46d3-8acc-dd896f0f2ecb","block_type":"box","text":"be added to the Board. The Board as a group strives to achieve diversity in terms of gender, race and","page_number":19,"box":{"x":117,"y":599,"width":759,"height":12}},{"id":"48369928-ca5f-41c7-9782-99965bb5f3d8","block_type":"box","text":"geographic location. The Governance and Nominating Committee believes that the Trustees as a","page_number":19,"box":{"x":116,"y":614,"width":728,"height":12}},{"id":"33699fff-38d1-444d-949d-805ee93554d0","block_type":"box","text":"group possess the array of skills, experiences and backgrounds necessary to guide the Fund. The","page_number":19,"box":{"x":116,"y":630,"width":734,"height":12}},{"id":"91dfcadf-e855-49e0-b5e3-652f61975f2a","block_type":"box","text":"Trustees’ biographies included herein highlight the diversity and breadth of skills, qualifications and","page_number":19,"box":{"x":116,"y":645,"width":739,"height":12}},{"id":"2c5e2214-5294-45e3-8179-f5cef9b970c8","block_type":"box","text":"expertise that the Trustees bring to the Fund.","page_number":19,"box":{"x":116,"y":661,"width":334,"height":12}},{"id":"9501649e-64ec-46af-9642-57e437e317ab","block_type":"box","text":"The Governance and Nominating Committee may consider nominations for Trustees made by the","page_number":19,"box":{"x":116,"y":692,"width":725,"height":12}},{"id":"1be80860-8e60-49d7-8dd9-c9399b2cb9e4","block_type":"box","text":"Fund’s shareholders as it deems appropriate. Under the Trust’s Bylaws, shareholders must follow","page_number":19,"box":{"x":117,"y":707,"width":724,"height":12}},{"id":"4c5ef570-5e24-4596-af72-3880ef2eb19e","block_type":"box","text":"certain procedures to nominate a person for election as a Trustee at a shareholder meeting at which","page_number":19,"box":{"x":116,"y":723,"width":744,"height":12}},{"id":"a195710e-72c8-42ee-a310-4a3a49d9e065","block_type":"box","text":"Trustees are to be elected. Under these advance notice procedures, shareholders must submit the","page_number":19,"box":{"x":116,"y":738,"width":733,"height":12}},{"id":"632a9f37-20f0-4504-b428-bccee84ad6ce","block_type":"box","text":"proposed nominee by delivering a notice to the Secretary of the Fund at its principal executive offices","page_number":19,"box":{"x":117,"y":754,"width":750,"height":12}},{"id":"456e1c6e-0692-42d3-858b-8acafa96837b","block_type":"box","text":"no earlier than the 150th day prior to such meeting and not later than 5:00 p.m., Eastern Time, on the","page_number":19,"box":{"x":117,"y":769,"width":751,"height":12}},{"id":"a827440a-310b-491e-9ea9-1449b178b0cf","block_type":"box","text":"later of the 120th day prior to such meeting or the tenth day following the day on which public","page_number":19,"box":{"x":117,"y":785,"width":690,"height":12}},{"id":"3d382423-ac24-4780-931a-34adcc3d4e6b","block_type":"box","text":"announcement is first made of the date of such meeting.","page_number":19,"box":{"x":116,"y":800,"width":418,"height":12}},{"id":"35ed2a93-8647-4bca-a4f7-5a021724df94","block_type":"box","text":"The Trust’s Bylaws provide that notice of a proposed nomination must include certain information","page_number":19,"box":{"x":116,"y":831,"width":726,"height":12}},{"id":"3c101958-733e-4b53-ad33-ed7949b166a4","block_type":"box","text":"about the shareholder and the nominee, as well as certain other information, including a written","page_number":19,"box":{"x":116,"y":847,"width":712,"height":12}},{"id":"a5c94f40-4c94-47a1-97bd-5edf362aff21","block_type":"box","text":"consent of the proposed nominee to serve if elected. Reference is made to the Trust’s Bylaws for more","page_number":19,"box":{"x":116,"y":862,"width":769,"height":12}},{"id":"9ee7a561-03da-4fd7-96ec-6deaf3612084","block_type":"box","text":"details.","page_number":19,"box":{"x":116,"y":878,"width":58,"height":9}},{"id":"573182fb-6898-4136-8b4b-0c1654e6ec7b","block_type":"box","text":"14","page_number":19,"box":{"x":492,"y":909,"width":16,"height":9}},{"id":"43d9ad6a-786b-4dd6-b12c-bfbe0e13eb6d","block_type":"box","text":"NM0926U-5926888-19/257","page_number":19,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"540e2c2f-bdc4-4cf1-aa48-ef2e50ff17a5","block_type":"box","text":"Compliance Committee","page_number":20,"box":{"x":117,"y":87,"width":166,"height":11}},{"id":"d5187c21-dac4-487c-b272-15734309c198","block_type":"box","text":". The Board has a Compliance Committee composed of Cynthia L. Egan (Chair),","page_number":20,"box":{"x":285,"y":87,"width":573,"height":11}},{"id":"67a006b6-7520-4b98-b872-fb41be79f08a","block_type":"box","text":"Stayce D. Harris, R. Glenn Hubbard and W. Carl Kester, all of whom are Independent Trustees. The","page_number":20,"box":{"x":116,"y":102,"width":714,"height":11}},{"id":"880a475c-799e-4e72-be47-e72263eaa52c","block_type":"box","text":"Compliance Committee’s purpose is to assist the Board in fulfilling its responsibility with respect to the","page_number":20,"box":{"x":116,"y":117,"width":726,"height":11}},{"id":"fc7ba356-cb53-4022-9145-94aa92960f54","block_type":"box","text":"oversight of regulatory and fiduciary compliance matters involving the Fund, the fund-related activities of","page_number":20,"box":{"x":116,"y":132,"width":744,"height":11}},{"id":"82abcbb0-abda-4437-86b9-628ebfdc1249","block_type":"box","text":"BlackRock, and any sub-advisers and the Fund’s other third party service providers. The Compliance","page_number":20,"box":{"x":117,"y":147,"width":720,"height":11}},{"id":"0f8eb76b-2c30-4f66-9c8f-5050bd0bb014","block_type":"box","text":"Committee’s responsibilities include, without limitation: (i) overseeing the compliance policies and","page_number":20,"box":{"x":116,"y":162,"width":694,"height":11}},{"id":"f85f200a-dccb-4e77-aa69-b810cde72e63","block_type":"box","text":"procedures of the Fund and its service providers and recommending changes or additions to such policies","page_number":20,"box":{"x":117,"y":177,"width":756,"height":11}},{"id":"c4c67368-3d7e-4358-95c8-7ed374949690","block_type":"box","text":"and procedures; (ii) reviewing information on and, where appropriate, recommending policies concerning","page_number":20,"box":{"x":116,"y":192,"width":747,"height":11}},{"id":"eb3a3ba0-0c21-4283-a1de-599f64eaea8f","block_type":"box","text":"the Fund’s compliance with applicable law; (iii) reviewing information on any significant correspondence","page_number":20,"box":{"x":116,"y":207,"width":738,"height":11}},{"id":"8605f652-e3bc-4a08-82b7-b15ec520b560","block_type":"box","text":"with or other actions by regulators or governmental agencies with respect to the Fund and any employee","page_number":20,"box":{"x":116,"y":222,"width":746,"height":11}},{"id":"aa48c6be-dea5-4fab-935b-41f4314bede9","block_type":"box","text":"complaints or published reports that raise concerns regarding compliance matters; and (iv) reviewing","page_number":20,"box":{"x":116,"y":237,"width":718,"height":11}},{"id":"389dc134-823d-4c56-9674-a57a8845fc57","block_type":"box","text":"reports from, overseeing the annual performance review of, and making certain recommendations in","page_number":20,"box":{"x":117,"y":252,"width":713,"height":11}},{"id":"34b16042-58c0-4d53-a60b-07fefb29c4dd","block_type":"box","text":"respect of, the Fund’s CCO, including, without limitation, determining the amount and structure of the","page_number":20,"box":{"x":117,"y":267,"width":718,"height":11}},{"id":"dc097fad-3cbb-4974-97cb-d5d6ef441a6d","block_type":"box","text":"CCO’s compensation. The Board has adopted a written charter for the Board’s Compliance Committee.","page_number":20,"box":{"x":116,"y":282,"width":736,"height":11}},{"id":"ac43a07c-0bb3-434d-a0c1-9209508e94d0","block_type":"box","text":"During the fiscal year ended April 30, 2026, the Compliance Committee met 4 times.","page_number":20,"box":{"x":117,"y":297,"width":599,"height":11}},{"id":"9edc4f86-b3bc-4770-b089-316f390665f8","block_type":"box","text":"Performance Oversight Committee","page_number":20,"box":{"x":116,"y":326,"width":248,"height":11}},{"id":"c775b6f8-11d6-4015-b008-10b3c7cc0a9f","block_type":"box","text":". The Board has a Performance Oversight Committee composed of","page_number":20,"box":{"x":366,"y":326,"width":478,"height":11}},{"id":"0610fe5e-b790-449c-9f00-5926be786674","block_type":"box","text":"Arthur P. Steinmetz (Chair), Cynthia L. Egan, Lorenzo A. Flores, Stayce D. Harris, J. Phillip Holloman, R.","page_number":20,"box":{"x":116,"y":341,"width":747,"height":11}},{"id":"ebb55e5a-9bea-4fc4-90cc-c60898868c24","block_type":"box","text":"Glenn Hubbard and W. Carl Kester, all of whom are Independent Trustees. The Performance Oversight","page_number":20,"box":{"x":117,"y":356,"width":737,"height":11}},{"id":"c97f6faa-6cdf-49f6-9ce9-bfd953b3d5c2","block_type":"box","text":"Committee’s purpose is to assist the Board in fulfilling its responsibility to oversee the Fund’s investment","page_number":20,"box":{"x":116,"y":371,"width":744,"height":11}},{"id":"3056e6b9-f303-4a6f-be57-6ddd5e601f2d","block_type":"box","text":"performance relative to the Fund’s investment objective, policies and practices. The Performance Oversight","page_number":20,"box":{"x":117,"y":386,"width":766,"height":11}},{"id":"ea814876-b90b-47da-a6d0-3c3f7ba6e3bd","block_type":"box","text":"Committee’s responsibilities include, without limitation: (i) reviewing the Fund’s investment objective,","page_number":20,"box":{"x":116,"y":401,"width":715,"height":11}},{"id":"bfa79438-c770-4d0a-92a1-58e6b745a734","block_type":"box","text":"policies and practices; (ii) recommending to the Board any required action in respect of changes in","page_number":20,"box":{"x":117,"y":416,"width":701,"height":11}},{"id":"c1bae858-ffdd-4b8b-b6b6-8f7659a748bd","block_type":"box","text":"fundamental and non-fundamental investment restrictions; (iii) reviewing information on appropriate","page_number":20,"box":{"x":116,"y":431,"width":708,"height":11}},{"id":"a64e014c-7b49-40a1-a3bc-d2e9a9ab5b7d","block_type":"box","text":"benchmarks and competitive universes; (iv) reviewing the Fund’s investment performance relative to such","page_number":20,"box":{"x":117,"y":446,"width":753,"height":11}},{"id":"5a3e5f12-c252-40c8-a819-28369eceeaf3","block_type":"box","text":"benchmarks; (v) reviewing information on unusual or exceptional investment matters; (vi) reviewing","page_number":20,"box":{"x":117,"y":461,"width":705,"height":11}},{"id":"fa5b54ab-684c-4d3b-b790-47383030a371","block_type":"box","text":"whether the Fund has complied with its investment policies and restrictions; and (vii) overseeing policies,","page_number":20,"box":{"x":116,"y":476,"width":746,"height":11}},{"id":"5fdaebb3-98f8-4b61-8212-8c30f3b07f5c","block_type":"box","text":"procedures and controls regarding valuation of the Fund’s investments. The Board has adopted a written","page_number":20,"box":{"x":117,"y":491,"width":745,"height":11}},{"id":"717ca57b-a40a-411e-93cd-f8843910a1d8","block_type":"box","text":"charter for the Board’s Performance Oversight Committee. During the fiscal year ended April 30, 2026, the","page_number":20,"box":{"x":116,"y":506,"width":758,"height":11}},{"id":"69b8b63e-a65e-463c-bfa3-7571d9aedba0","block_type":"box","text":"Performance Oversight Committee met 4 times.","page_number":20,"box":{"x":117,"y":521,"width":339,"height":11}},{"id":"15c51d52-6e75-4f59-8fc2-7fd81053c73f","block_type":"box","text":"Securities Lending Committee.","page_number":20,"box":{"x":117,"y":550,"width":215,"height":11}},{"id":"bdfb0b1d-a1f3-47d6-810e-716ce53d9d48","block_type":"box","text":"The Board has a Securities Lending Committee composed of Arthur","page_number":20,"box":{"x":338,"y":550,"width":480,"height":11}},{"id":"f7313fc2-9434-46b6-8edb-e495d16125ea","block_type":"box","text":"P. Steinmetz (Chair), Cynthia L. Egan and W. Carl","page_number":20,"box":{"x":117,"y":565,"width":353,"height":11}},{"id":"cd724f90-568c-4a13-9771-d21d9b4d56ac","block_type":"box","text":"Kester, all of whom are Independent Trustees. The","page_number":20,"box":{"x":476,"y":565,"width":359,"height":11}},{"id":"f73c74ed-4f51-4bbd-a3bb-1714824e7ce6","block_type":"box","text":"principal responsibilities of the Securities Lending Co","page_number":20,"box":{"x":117,"y":580,"width":372,"height":11}},{"id":"475d394e-297d-419b-b7ed-bf4e12810b06","block_type":"box","text":"mmittee include, without limitation: (i) supporting,","page_number":20,"box":{"x":491,"y":580,"width":343,"height":11}},{"id":"dacbef04-1b62-416a-99b6-e3ded601d5ba","block_type":"box","text":"overseeing and organizing on behalf of the Board the proce","page_number":20,"box":{"x":116,"y":595,"width":420,"height":11}},{"id":"e6a49d0e-32fe-4edc-b4bf-ce6fb0fa2906","block_type":"box","text":"ss for oversight of the Fund’s securities lending","page_number":20,"box":{"x":537,"y":595,"width":331,"height":11}},{"id":"df43ce02-364c-4cd7-a7bc-a0631e6028b3","block_type":"box","text":"activities; and (ii) providing a recommendation to","page_number":20,"box":{"x":116,"y":610,"width":342,"height":11}},{"id":"a60a3f36-2071-4e3b-b5c1-06497b7f2b7c","block_type":"box","text":"the Board regarding the annual approval of the Fund’s","page_number":20,"box":{"x":463,"y":610,"width":382,"height":11}},{"id":"924b36b7-7b0d-475e-a815-c8244c0d2f42","block_type":"box","text":"Securities Lending Guidelines and the Fund’s agreem","page_number":20,"box":{"x":116,"y":625,"width":379,"height":11}},{"id":"9a3dd73c-58da-4708-b090-414eaa7de7b2","block_type":"box","text":"ent with the lending agent. The Board has adopted a","page_number":20,"box":{"x":497,"y":625,"width":370,"height":11}},{"id":"a8a95bda-3b80-4965-b7cf-4288fe7d3e93","block_type":"box","text":"written charter for the Board’s Securities Lending","page_number":20,"box":{"x":116,"y":640,"width":344,"height":11}},{"id":"32f21876-0577-4872-887e-02b99c224e7c","block_type":"box","text":"Committee. During the fiscal year ended April 30, 2026,","page_number":20,"box":{"x":466,"y":640,"width":391,"height":11}},{"id":"f12f9535-61a2-4ee6-8579-4697a699b4a3","block_type":"box","text":"the Securities Lending Committee met 2 times.","page_number":20,"box":{"x":116,"y":655,"width":330,"height":11}},{"id":"274d4335-09f7-4644-82fd-e3530436ee4a","block_type":"box","text":"Executive Committee","page_number":20,"box":{"x":116,"y":684,"width":152,"height":9}},{"id":"0498832b-92bd-4c83-94ca-fa217131229f","block_type":"box","text":". The Board has an Executive Committee composed of R. Glenn Hubbard (Chair) and","page_number":20,"box":{"x":270,"y":684,"width":609,"height":11}},{"id":"41b90f89-3139-4826-b5a6-b3403c1c0cc2","block_type":"box","text":"W. Carl Kester, both of whom are Independent Trustees, and John M. Perlowski, who serves as an","page_number":20,"box":{"x":116,"y":699,"width":706,"height":11}},{"id":"01255743-0fa6-4b7d-ad8b-3e9f0c6cdeb8","block_type":"box","text":"interested Trustee. The principal responsibilities of the Executive Committee include, without limitation:","page_number":20,"box":{"x":117,"y":714,"width":731,"height":11}},{"id":"4d78d8ec-2e83-4aff-a21a-46f9f90000ae","block_type":"box","text":"(i) acting on routine matters between meetings of the Board; (ii) acting on such matters as may require","page_number":20,"box":{"x":117,"y":729,"width":729,"height":11}},{"id":"252b2097-f3e0-4c91-a0d9-5a85c9d81b06","block_type":"box","text":"urgent action between meetings of the Board; and (iii) exercising such other authority as may from time to","page_number":20,"box":{"x":117,"y":744,"width":752,"height":11}},{"id":"2a3e7fca-46f2-4ae5-baf2-98a22be5962c","block_type":"box","text":"time be delegated to the Executive Committee by the Board. The Board has adopted a written charter for","page_number":20,"box":{"x":116,"y":759,"width":748,"height":11}},{"id":"4ad7779e-b0bb-4a22-91af-aaddaa63374b","block_type":"box","text":"the Board’s Executive Committee. During the fiscal year ended April 30, 2026 the Executive Committee did","page_number":20,"box":{"x":116,"y":774,"width":762,"height":11}},{"id":"7eb0342e-d9e2-471a-97b7-4336ddb12615","block_type":"box","text":"not meet.","page_number":20,"box":{"x":117,"y":789,"width":65,"height":9}},{"id":"9e6da748-29cf-4710-b2eb-0bed60da6828","block_type":"box","text":"Private Assets Committee","page_number":20,"box":{"x":116,"y":818,"width":185,"height":9}},{"id":"44058212-82f5-4ecc-aba2-f5c9928b27e4","block_type":"box","text":". The Board has a Private Assets Committee composed of W. Carl Kester","page_number":20,"box":{"x":303,"y":818,"width":524,"height":11}},{"id":"09b887ec-972e-4d97-815e-4f9a38ffd388","block_type":"box","text":"(Chair), Cynthia L. Egan and Arthur P. Steinmetz, all of whom are Independent Trustees. The principal","page_number":20,"box":{"x":117,"y":833,"width":729,"height":11}},{"id":"41260043-d689-4ad8-bf2a-c94ee2d2a912","block_type":"box","text":"responsibilities of the Private Assets Committee include, without limitation: (i) monitoring, on behalf of the","page_number":20,"box":{"x":117,"y":848,"width":748,"height":11}},{"id":"334e260d-c157-4271-9c97-cb86e70a08ee","block_type":"box","text":"Board, through reviews of periodic reports from BlackRock, certain categories or types of private assets","page_number":20,"box":{"x":117,"y":863,"width":737,"height":11}},{"id":"b5381c62-df9e-484d-8393-8ddd63adff8e","block_type":"box","text":"held by the Fund that have been identified by the Committee (“subject private assets”); (ii) assisting the","page_number":20,"box":{"x":117,"y":878,"width":733,"height":11}},{"id":"10c43705-1dcf-48d9-b872-c4963b8c1b5b","block_type":"box","text":"15","page_number":20,"box":{"x":492,"y":909,"width":16,"height":9}},{"id":"bf6035d0-da19-4a55-b064-fc0edc5e4f45","block_type":"box","text":"NM0926U-5926888-20/257","page_number":20,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"f7c1637d-6816-4ce8-a51a-16a178996b12","block_type":"box","text":"Board and its other Committees to oversee the actions of the Fund’s valuation designee and liquidity risk","page_number":21,"box":{"x":117,"y":87,"width":745,"height":11}},{"id":"0d823f9e-03ec-4231-9c41-0cf8bd7c567d","block_type":"box","text":"manager in respect of the valuation and liquidity, respectively, of subject private assets held by the Fund;","page_number":21,"box":{"x":117,"y":102,"width":746,"height":11}},{"id":"a2be8f0c-aa90-4114-b1f5-1bf621da896a","block_type":"box","text":"(iii) engaging with BlackRock on the oversight of subject private assets; (iv) reviewing and making","page_number":21,"box":{"x":117,"y":117,"width":694,"height":11}},{"id":"d2a69062-2ab8-4db6-9364-19c03c76cf28","block_type":"box","text":"recommendations to the Board and/or its Committees regarding the Board’s oversight of subject private","page_number":21,"box":{"x":117,"y":132,"width":737,"height":11}},{"id":"c873a6de-ceff-49ed-b160-c60a5a93a109","block_type":"box","text":"assets; and (v) addressing such other matters relating to subject private assets held by the Fund as the","page_number":21,"box":{"x":116,"y":147,"width":736,"height":11}},{"id":"25184678-60ad-4ba7-821a-3f9fe6f6bba0","block_type":"box","text":"Committee deems appropriate, including assisting the Board’s consideration of subject private assets in","page_number":21,"box":{"x":116,"y":162,"width":738,"height":11}},{"id":"34b7ea70-82f2-4ae4-85d0-accb4796c944","block_type":"box","text":"conjunction with the annual consideration of the Fund’s investment advisory agreements. The Board has","page_number":21,"box":{"x":116,"y":177,"width":745,"height":11}},{"id":"69d5a9eb-b9f9-468c-8858-aa99e2862279","block_type":"box","text":"adopted a written charter for the Board’s Private Assets Committee. As the Private Assets Committee","page_number":21,"box":{"x":116,"y":192,"width":723,"height":11}},{"id":"e273a367-a55c-467b-b513-6a88cd0244d5","block_type":"box","text":"was established in July 2026, during the fiscal year ended April 30, 2026, the Private Assets Committee did","page_number":21,"box":{"x":116,"y":207,"width":764,"height":11}},{"id":"46003a3e-5d58-4d96-a8da-6e3502978200","block_type":"box","text":"not meet.","page_number":21,"box":{"x":117,"y":222,"width":65,"height":9}},{"id":"12e39387-cb8b-4989-bd19-f34e8cba209c","block_type":"box","text":"The Independent Trustees have adopted a statement of policy that describes the experiences,","page_number":21,"box":{"x":116,"y":251,"width":671,"height":11}},{"id":"7a5b95b3-88f4-4353-8eee-9c48c02a0386","block_type":"box","text":"qualifications, skills and attributes that are necessary and desirable for potential Independent Trustee","page_number":21,"box":{"x":116,"y":266,"width":721,"height":11}},{"id":"8c6ce9fa-2c3e-4331-b37a-2c25fdd42108","block_type":"box","text":"candidates (the “Statement of Policy”). The Board believes that each Independent Trustee satisfied, at the","page_number":21,"box":{"x":116,"y":281,"width":756,"height":11}},{"id":"204cbdfe-e33c-480b-9a93-0a53e7d2be37","block_type":"box","text":"time he or she was initially elected or appointed a Trustee, and continues to satisfy, the standards","page_number":21,"box":{"x":116,"y":296,"width":696,"height":11}},{"id":"5f06d804-f9d7-44a0-a053-8285a5bd9e82","block_type":"box","text":"contemplated by the Statement of Policy as well as the standards set forth in the Trust’s Bylaws.","page_number":21,"box":{"x":116,"y":311,"width":685,"height":11}},{"id":"cb24ad1c-db26-44ec-8438-bb36dac87ee2","block_type":"box","text":"Furthermore, in determining that a particular Trustee was and continues to be qualified to serve as a","page_number":21,"box":{"x":117,"y":326,"width":713,"height":11}},{"id":"849897a4-eb1f-49b6-bd55-dad1dbdc7f15","block_type":"box","text":"Trustee, the Board has considered a variety of criteria, none of which, in isolation, was controlling. The","page_number":21,"box":{"x":116,"y":341,"width":731,"height":11}},{"id":"6121444b-6957-4053-bd5f-a080202bd08c","block_type":"box","text":"Board believes that, collectively, the Trustees have balanced and diverse experiences, skills, attributes and","page_number":21,"box":{"x":117,"y":356,"width":762,"height":11}},{"id":"177a6d01-b648-409a-bf9c-4bbafa3e5ba4","block_type":"box","text":"qualifications, which allow the Board to operate effectively in governing the Fund and protecting the","page_number":21,"box":{"x":116,"y":371,"width":708,"height":11}},{"id":"5f9a7b2f-f414-4a8d-8005-ea21de43ca09","block_type":"box","text":"interests of shareholders. Among the attributes common to all Trustees is their ability to review critically,","page_number":21,"box":{"x":117,"y":386,"width":738,"height":11}},{"id":"e45e6779-5c13-4d0d-9eaf-1f33c857eaa3","block_type":"box","text":"evaluate, question and discuss information provided to them, to interact effectively with the Manager,","page_number":21,"box":{"x":116,"y":401,"width":718,"height":11}},{"id":"e1e2009a-ef67-44d6-8db4-88b48595c518","block_type":"box","text":"sub-advisers, other service providers, counsel and independent auditors, and to exercise effective","page_number":21,"box":{"x":116,"y":416,"width":699,"height":11}},{"id":"9a0a3d28-d33f-4822-8433-f5c56828172e","block_type":"box","text":"business judgment in the performance of their duties as Trustees. Each Trustee’s ability to perform his or","page_number":21,"box":{"x":117,"y":431,"width":748,"height":11}},{"id":"e1f6d070-e27b-47e2-b1ba-6073cdcd30b5","block_type":"box","text":"her duties effectively is evidenced by his or her educational background or professional training; business,","page_number":21,"box":{"x":117,"y":445,"width":754,"height":12}},{"id":"45decfee-40dc-4225-9975-33c3d6c449d1","block_type":"box","text":"consulting, public service or academic positions; experience from service as a board member of the Trust","page_number":21,"box":{"x":116,"y":460,"width":752,"height":12}},{"id":"72c00901-7b6e-4df3-8b6c-877e34ffdfea","block_type":"box","text":"or the other funds in the BlackRock Fund Complexes (and any predecessor funds), other investment funds,","page_number":21,"box":{"x":116,"y":475,"width":764,"height":12}},{"id":"17e60531-29b7-4691-9b74-05a7e8865300","block_type":"box","text":"public companies, or not-for-profit entities or other organizations; ongoing commitment and participation in","page_number":21,"box":{"x":117,"y":490,"width":755,"height":12}},{"id":"ec848937-af13-4f16-8714-5b971c737c59","block_type":"box","text":"Board and Committee meetings, as well as his or her leadership of standing and other committees","page_number":21,"box":{"x":117,"y":505,"width":700,"height":12}},{"id":"e168801c-892b-476a-9463-cfb9ccb6b0b0","block_type":"box","text":"throughout the years; or other relevant life experiences.","page_number":21,"box":{"x":116,"y":520,"width":394,"height":12}},{"id":"f4f9e008-6068-4aab-b8c1-f5ff53ae288f","block_type":"box","text":"The table below discusses some of the experiences, qualifications and skills of each Trustee that support","page_number":21,"box":{"x":116,"y":549,"width":750,"height":12}},{"id":"035188ec-5e0d-4d9d-a989-5184c2ecb153","block_type":"box","text":"the conclusion that he or she should serve on the Board.","page_number":21,"box":{"x":116,"y":565,"width":403,"height":9}},{"id":"bafb076f-1d35-4880-9d44-7630cef5757d","block_type":"box","text":"Trustees","page_number":21,"box":{"x":172,"y":590,"width":55,"height":8}},{"id":"cb32301c-5cac-48db-b7a3-fb0c45019869","block_type":"box","text":"Experience, Qualifications and Skills","page_number":21,"box":{"x":471,"y":590,"width":233,"height":10}},{"id":"f188de32-e2b3-45a0-81c7-e440be4f66ac","block_type":"box","text":"Independent Trustees","page_number":21,"box":{"x":117,"y":609,"width":162,"height":12}},{"id":"2c397482-0450-4978-a52c-00c8991136d6","block_type":"box","text":"R. Glenn Hubbard R. Glenn Hubbard has served in numerous roles in the field of economics, including","page_number":21,"box":{"x":117,"y":631,"width":765,"height":11}},{"id":"149c304b-2888-440f-b2c7-ac31818aa92f","block_type":"box","text":"as the Chairman of the U.S. Council of Economic Advisers of the President of the","page_number":21,"box":{"x":291,"y":645,"width":574,"height":9}},{"id":"b0c32f25-d015-460e-880e-39b8b36158f0","block_type":"box","text":"United States. Dr. Hubbard has served as the Dean of Columbia Business School,","page_number":21,"box":{"x":292,"y":660,"width":581,"height":10}},{"id":"a54b6232-b06f-4e04-89ae-a422d64842b4","block_type":"box","text":"as a member of the Columbia Faculty and as a Visiting Professor at the John F.","page_number":21,"box":{"x":291,"y":674,"width":562,"height":12}},{"id":"e8a0be34-1859-44df-9717-d33561671349","block_type":"box","text":"Kennedy School of Government at Harvard University, the Harvard Business","page_number":21,"box":{"x":292,"y":689,"width":541,"height":11}},{"id":"2364941d-d38a-4ab6-8477-bedc4b6ca18f","block_type":"box","text":"School and the University of Chicago. Dr. Hubbard’s experience as an adviser to","page_number":21,"box":{"x":291,"y":703,"width":570,"height":12}},{"id":"97cc1732-d6f1-4ba9-86cc-745e1ffd2cc6","block_type":"box","text":"the President of the United States adds a dimension of balance to the Fund’s","page_number":21,"box":{"x":291,"y":718,"width":544,"height":9}},{"id":"8dbcd2c4-4a59-448f-bccc-601f4794089c","block_type":"box","text":"governance and provides perspective on economic issues. Dr. Hubbard’s service","page_number":21,"box":{"x":291,"y":733,"width":573,"height":11}},{"id":"691d7d09-22b1-4a38-b8db-393a8f9b3afd","block_type":"box","text":"on the boards of ADP and Metropolitan Life Insurance Company provides the","page_number":21,"box":{"x":291,"y":747,"width":546,"height":11}},{"id":"28f6e5a8-9fe9-414e-bdd7-dd61b230b259","block_type":"box","text":"Board with the benefit of his experience with the management practices of other","page_number":21,"box":{"x":292,"y":761,"width":565,"height":12}},{"id":"4284a553-e7e6-445f-b90c-93f38f3975a6","block_type":"box","text":"financial companies. Dr. Hubbard’s long-standing service on the boards of","page_number":21,"box":{"x":291,"y":776,"width":525,"height":11}},{"id":"d75305ea-aa06-48e3-997a-a372ce016df3","block_type":"box","text":"directors/trustees of the closed-end funds in the BlackRock Fixed-Income Complex","page_number":21,"box":{"x":291,"y":790,"width":586,"height":12}},{"id":"579d76b0-9590-454b-ac53-07bf4107e87f","block_type":"box","text":"also provides him with a specific understanding of the Fund, its operations, and the","page_number":21,"box":{"x":291,"y":805,"width":586,"height":12}},{"id":"9ac26da6-3e0a-491a-9f75-0064354cbd05","block_type":"box","text":"business and regulatory issues facing the Fund. Dr. Hubbard’s independence from","page_number":21,"box":{"x":292,"y":820,"width":582,"height":11}},{"id":"62269046-9906-4968-8cc8-80432841cb88","block_type":"box","text":"the Fund and the Manager enhances his service as Chair of the Board, Chair of the","page_number":21,"box":{"x":291,"y":834,"width":590,"height":12}},{"id":"060d380d-8e5a-4a53-ae5e-a2536c12076a","block_type":"box","text":"Executive Committee and a member of the Governance and Nominating","page_number":21,"box":{"x":292,"y":849,"width":510,"height":11}},{"id":"04bfdbbd-0e55-4a41-8009-42a092fe0c8c","block_type":"box","text":"Committee, the Compliance Committee and the Performance Oversight","page_number":21,"box":{"x":292,"y":863,"width":505,"height":12}},{"id":"4ff6f75f-23c7-4157-8b6e-ae9be82125fb","block_type":"box","text":"Committee.","page_number":21,"box":{"x":292,"y":878,"width":79,"height":9}},{"id":"93b2bfed-f829-4d87-ae07-434e2d8aa540","block_type":"box","text":"16","page_number":21,"box":{"x":492,"y":909,"width":16,"height":9}},{"id":"39678673-d969-4385-89d4-12b8327293b6","block_type":"box","text":"NM0926U-5926888-21/257","page_number":21,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"9a622ed9-69d4-4acd-be39-499a73e428eb","block_type":"box","text":"Trustees","page_number":22,"box":{"x":172,"y":84,"width":55,"height":7}},{"id":"ab87b665-e54e-488e-8d05-b2cf9d2fbd4e","block_type":"box","text":"Experience, Qualifications and Skills","page_number":22,"box":{"x":471,"y":84,"width":233,"height":9}},{"id":"38c8f88f-810b-4338-bdf4-ebd4194ac997","block_type":"box","text":"W. Carl Kester The Board benefits from W. Carl Kester’s experiences as a professor and author in","page_number":22,"box":{"x":116,"y":102,"width":760,"height":12}},{"id":"0c9808cb-6405-45dd-8b68-032a5683e8ba","block_type":"box","text":"finance, and his experience as the George Fisher Baker Jr. Professor of Business","page_number":22,"box":{"x":291,"y":117,"width":578,"height":12}},{"id":"bf65417a-96c3-41e3-8bdd-c4380fbba8b8","block_type":"box","text":"Administration at Harvard Business School and as Deputy Dean of Academic","page_number":22,"box":{"x":291,"y":132,"width":546,"height":12}},{"id":"e7c839a5-d44f-4bd3-8b9c-7f8269221fc8","block_type":"box","text":"Affairs at Harvard Business School from 2006 through 2010 adds to the Board a","page_number":22,"box":{"x":291,"y":147,"width":567,"height":11}},{"id":"0bc15ec3-bcd3-4259-bdbb-3adad3401aab","block_type":"box","text":"wealth of expertise in corporate finance and corporate governance. Dr. Kester has","page_number":22,"box":{"x":291,"y":162,"width":581,"height":11}},{"id":"9cbb7900-b21e-4c74-83db-129422c4f062","block_type":"box","text":"authored and edited numerous books and research papers on both subject matters,","page_number":22,"box":{"x":291,"y":177,"width":591,"height":11}},{"id":"cda8f674-724a-4408-ad53-de2499ead188","block_type":"box","text":"including co-editing a leading volume of finance case studies used worldwide.","page_number":22,"box":{"x":292,"y":191,"width":547,"height":12}},{"id":"334bb16c-144c-4479-af95-5b002c70a65d","block_type":"box","text":"Dr. Kester’s long-standing service on the boards of directors/trustees of the","page_number":22,"box":{"x":292,"y":206,"width":530,"height":12}},{"id":"c628e9be-b677-42ef-b2f9-9004bc3b5da7","block_type":"box","text":"closed-end funds in the BlackRock Fixed-Income Complex also provides him with a","page_number":22,"box":{"x":291,"y":221,"width":589,"height":12}},{"id":"75895668-1011-4772-a4ab-13a062e25051","block_type":"box","text":"specific understanding of the Fund, its operations, and the business and regulatory","page_number":22,"box":{"x":291,"y":236,"width":586,"height":12}},{"id":"159cc3fe-5479-4dc1-85cb-cdb6a964b4c1","block_type":"box","text":"issues facing the Fund. Dr. Kester’s independence from the Fund and the Manager","page_number":22,"box":{"x":292,"y":251,"width":587,"height":11}},{"id":"5bf8ec35-c7a9-4635-9599-f5550413cefe","block_type":"box","text":"enhances his service as a Vice Chair of the Board, Chair of the Governance and","page_number":22,"box":{"x":291,"y":266,"width":568,"height":10}},{"id":"70ca4f45-b062-43f1-a87b-a724362bebe6","block_type":"box","text":"Nominating Committee, Chair of the Private Assets Committee and a member of","page_number":22,"box":{"x":292,"y":281,"width":568,"height":11}},{"id":"3c064421-8e70-4d77-bcc9-eaecf6ae54f8","block_type":"box","text":"the Executive Committee, the Compliance Committee, the Performance Oversight","page_number":22,"box":{"x":291,"y":295,"width":580,"height":12}},{"id":"1b26580f-0602-4a25-b62a-b812519ba606","block_type":"box","text":"Committee and the Securities Lending Committee.","page_number":22,"box":{"x":292,"y":310,"width":355,"height":12}},{"id":"77908ff1-f134-41c6-9cad-80d5c0d8db53","block_type":"box","text":"Cynthia L. Egan Cynthia L. Egan brings to the Board a broad and diverse knowledge of investment","page_number":22,"box":{"x":116,"y":333,"width":755,"height":11}},{"id":"2b18683e-eb9c-453c-aa7c-1b6aa6062785","block_type":"box","text":"companies and the retirement industry as a result of her many years of experience","page_number":22,"box":{"x":291,"y":348,"width":583,"height":11}},{"id":"d28f54ca-d9c1-42b6-9074-47c0708117e2","block_type":"box","text":"as President, Retirement Plan Services, for T. Rowe Price Group, Inc. and her","page_number":22,"box":{"x":291,"y":363,"width":554,"height":11}},{"id":"176d5aba-8cc0-44da-8ea3-33899842d9c4","block_type":"box","text":"various senior operating officer positions at Fidelity Investments, including her","page_number":22,"box":{"x":291,"y":378,"width":550,"height":11}},{"id":"130fb7e9-493b-4a27-b398-8f3a8dfe2849","block_type":"box","text":"service as Executive Vice President of FMR Co., President of Fidelity Institutional","page_number":22,"box":{"x":291,"y":392,"width":574,"height":12}},{"id":"bc212d67-fd64-441b-8cda-c22506b67167","block_type":"box","text":"Services Company and President of the Fidelity Charitable Gift Fund. Ms. Egan has","page_number":22,"box":{"x":291,"y":407,"width":591,"height":12}},{"id":"153e4f03-8214-469e-84f5-50bf53f3bb3a","block_type":"box","text":"also served as an advisor to the U.S. Department of Treasury as an expert in","page_number":22,"box":{"x":291,"y":422,"width":544,"height":12}},{"id":"00d3b938-1f74-45fd-906f-669f8dc4f500","block_type":"box","text":"domestic retirement security. Ms. Egan began her professional career at the Board","page_number":22,"box":{"x":291,"y":437,"width":584,"height":11}},{"id":"a5a0953a-375d-4612-8191-b12331b40a19","block_type":"box","text":"of Governors of the Federal Reserve and the Federal Reserve Bank of New York.","page_number":22,"box":{"x":291,"y":452,"width":576,"height":9}},{"id":"a4879fd7-5b60-4587-aefb-755f93df4e30","block_type":"box","text":"Ms. Egan is also a director of UNUM Corporation, a publicly traded insurance","page_number":22,"box":{"x":292,"y":467,"width":545,"height":11}},{"id":"8340d43f-dc8c-4938-835d-76d600bdbc41","block_type":"box","text":"company providing personal risk reinsurance, and a director and Chair of the Board","page_number":22,"box":{"x":291,"y":482,"width":589,"height":11}},{"id":"9cbc394e-292b-40fd-8c6f-116f38026f24","block_type":"box","text":"of The Hanover Group, a public property casualty insurance company. Ms. Egan is","page_number":22,"box":{"x":291,"y":496,"width":585,"height":12}},{"id":"2919783c-5025-4a41-9539-b10edf0f061f","block_type":"box","text":"also the lead independent director and non-executive Vice Chair of the Board of","page_number":22,"box":{"x":291,"y":511,"width":565,"height":12}},{"id":"d6ac1461-9f30-462e-9911-a7cb07e1a1a4","block_type":"box","text":"Huntsman Corporation, a publicly traded manufacturer and marketer of chemical","page_number":22,"box":{"x":292,"y":526,"width":567,"height":12}},{"id":"06930333-6fee-4c43-bd96-669b0cf7d01e","block_type":"box","text":"products. Ms. Egan’s independence from the Fund and the Manager enhances her","page_number":22,"box":{"x":292,"y":541,"width":585,"height":11}},{"id":"a1b98826-e55a-46cb-b8ec-c0bdd2a5855c","block_type":"box","text":"service as Chair of the Compliance Committee, and a member of the Governance","page_number":22,"box":{"x":291,"y":556,"width":578,"height":11}},{"id":"104e3495-921f-4f34-81c6-9613c5a34ee7","block_type":"box","text":"and Nominating Committee, the Performance Oversight Committee, the Securities","page_number":22,"box":{"x":291,"y":571,"width":581,"height":11}},{"id":"4d6ff669-c978-496f-afe2-12ead8b75ccb","block_type":"box","text":"Lending Committee and the Private Assets Committee.","page_number":22,"box":{"x":292,"y":586,"width":387,"height":11}},{"id":"bb8b6b51-1671-4b45-92b7-eaf76c3d8822","block_type":"box","text":"Lorenzo A. Flores The Board benefits from Lorenzo A. Flores’s many years of business, leadership","page_number":22,"box":{"x":117,"y":608,"width":743,"height":12}},{"id":"ccfb5863-0012-439f-9457-d9e59eecb8ef","block_type":"box","text":"and financial experience in his roles at various public and private companies. In","page_number":22,"box":{"x":291,"y":623,"width":561,"height":11}},{"id":"b369e05b-e33d-4258-9a3c-8a8ed88d8166","block_type":"box","text":"particular, Mr. Flores’s service as Chief Financial Officer of Lattice Semiconductor","page_number":22,"box":{"x":292,"y":638,"width":576,"height":11}},{"id":"2eec3a81-4d6f-4db5-a7eb-9e1630ce635c","block_type":"box","text":"Corporation, a semiconductor company that designs, develops, and markets","page_number":22,"box":{"x":292,"y":653,"width":539,"height":11}},{"id":"a36952c6-c649-4b21-ba0b-3aac11083baa","block_type":"box","text":"programmable logic products and related software, Chief Financial Officer of Intel","page_number":22,"box":{"x":292,"y":668,"width":573,"height":11}},{"id":"df64c87b-c5d4-4da1-b081-ad68a37cc94c","block_type":"box","text":"Foundry, a semiconductor manufacturing unit of Intel Corporation, Chief Financial","page_number":22,"box":{"x":292,"y":682,"width":575,"height":12}},{"id":"0825a53b-c929-46ac-a559-aa7496c7666a","block_type":"box","text":"Officer and Corporate Controller of Xilinx, Inc., a technology and semiconductor","page_number":22,"box":{"x":291,"y":697,"width":563,"height":12}},{"id":"a0770f57-a4ef-4ee4-87bf-3861bd95e460","block_type":"box","text":"company that supplies programmable logic devices, and Vice Chairman of Kioxia,","page_number":22,"box":{"x":291,"y":712,"width":577,"height":12}},{"id":"a205a0c1-8c77-4588-b1a8-f8dbc9965ca9","block_type":"box","text":"Inc., a manufacturer and supplier of flash memory and solid state drives, and his","page_number":22,"box":{"x":292,"y":727,"width":566,"height":11}},{"id":"ac05e9f1-34f5-4e11-b88f-ae375d466dd4","block_type":"box","text":"long experience in the technology industry allow him to provide insight to into","page_number":22,"box":{"x":292,"y":742,"width":542,"height":11}},{"id":"2758f293-f743-4e93-aa5b-2823fe9f6a68","block_type":"box","text":"financial, business and technology trends. Mr. Flores’s knowledge of financial and","page_number":22,"box":{"x":291,"y":757,"width":577,"height":11}},{"id":"281c3ee4-96bc-4210-8252-4a47d0ac6902","block_type":"box","text":"accounting matters qualifies him to serve as Chair of the Audit Committee.","page_number":22,"box":{"x":291,"y":772,"width":524,"height":11}},{"id":"d8d2ef71-f856-42e7-a040-da95aa9d084f","block_type":"box","text":"Mr. Flores’s independence from the Fund and the Manager enhances his service","page_number":22,"box":{"x":292,"y":786,"width":571,"height":12}},{"id":"e5f961e4-b7ca-46ad-b4c7-b63eefafb1d2","block_type":"box","text":"as a member of the Performance Oversight Committee. Mr. Flores has been","page_number":22,"box":{"x":291,"y":801,"width":539,"height":12}},{"id":"f3a902f7-cb28-4424-bcb8-454907c0dab6","block_type":"box","text":"determined by the Audit Committee to be an audit committee","page_number":22,"box":{"x":291,"y":816,"width":430,"height":12}},{"id":"21029218-c40d-43b7-bb82-0f1ff7ce248e","block_type":"box","text":"financial expert, as such term is defined in the applicable Commission rules.","page_number":22,"box":{"x":291,"y":831,"width":536,"height":11}},{"id":"963c77ca-f957-4089-bb31-3b5c38d4915e","block_type":"box","text":"17","page_number":22,"box":{"x":492,"y":909,"width":16,"height":9}},{"id":"75c0eb5d-c6f5-467e-a314-a846cd38fa13","block_type":"box","text":"NM0926U-5926888-22/257","page_number":22,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"c1d7e380-db70-4677-8b1a-54997a249f14","block_type":"box","text":"Trustees","page_number":23,"box":{"x":172,"y":84,"width":55,"height":7}},{"id":"d62f18b5-2f9d-4ac6-beca-07ce5023b47e","block_type":"box","text":"Experience, Qualifications and Skills","page_number":23,"box":{"x":471,"y":84,"width":233,"height":9}},{"id":"ed36f9aa-0289-429d-b085-c485fabfb009","block_type":"box","text":"Stayce D. Harris The Board benefits from Stayce D. Harris’s leadership and governance experience","page_number":23,"box":{"x":116,"y":102,"width":759,"height":12}},{"id":"f1019be1-642e-4266-a87d-ecd60251f6be","block_type":"box","text":"gained during her extensive military career, including as a three-star Lieutenant","page_number":23,"box":{"x":291,"y":117,"width":560,"height":12}},{"id":"1a7d6094-4296-4611-a185-7a2ec258ecd4","block_type":"box","text":"General of the United States Air Force. In her most recent role, Ms. Harris reported","page_number":23,"box":{"x":292,"y":132,"width":584,"height":11}},{"id":"c1ba0c3c-a398-4a98-8ad5-233c8877be94","block_type":"box","text":"to the Secretary and Chief of Staff of the Air Force on matters concerning Air Force","page_number":23,"box":{"x":291,"y":147,"width":587,"height":11}},{"id":"19bcad15-d1a5-40e4-ba52-92be5749d26a","block_type":"box","text":"effectiveness, efficiency and the military discipline of active duty, Air Force Reserve","page_number":23,"box":{"x":291,"y":162,"width":588,"height":11}},{"id":"60d3dae4-03da-42da-8a79-eef3cd5e9a68","block_type":"box","text":"and Air National Guard forces. Ms. Harris’s experience on governance matters","page_number":23,"box":{"x":291,"y":177,"width":555,"height":11}},{"id":"336f0f22-27cf-4cbf-a1f3-44b0fdeb4d82","block_type":"box","text":"includes oversight of inspection policy and the inspection and evaluation system for","page_number":23,"box":{"x":292,"y":191,"width":589,"height":12}},{"id":"b15816a3-675b-438b-909b-57a471d93d92","block_type":"box","text":"all Air Force nuclear and conventional forces; oversight of Air Force","page_number":23,"box":{"x":291,"y":206,"width":476,"height":12}},{"id":"ba67a4a6-e547-4065-8649-c754a59f2e5f","block_type":"box","text":"counterintelligence operations and service on the Air Force Intelligence Oversight","page_number":23,"box":{"x":291,"y":221,"width":576,"height":12}},{"id":"ffc850da-53f4-4a94-a4c2-50b1247bf697","block_type":"box","text":"Panel; investigation of fraud, waste and abuse; and oversight of criminal","page_number":23,"box":{"x":292,"y":236,"width":508,"height":12}},{"id":"5192f758-c533-414c-b0df-2c4a8916baa9","block_type":"box","text":"investigations and complaints resolution programs. Ms. Harris is also a director of","page_number":23,"box":{"x":292,"y":251,"width":575,"height":11}},{"id":"e72e5958-b689-4e83-84cf-89d92c6afe19","block_type":"box","text":"The Boeing Company. Ms. Harris’s independence from the Fund and the Manager","page_number":23,"box":{"x":291,"y":266,"width":583,"height":11}},{"id":"e2cdf791-998f-40de-8be6-6da8101fb834","block_type":"box","text":"enhances her service as a member of the Compliance Committee and the","page_number":23,"box":{"x":291,"y":281,"width":523,"height":11}},{"id":"08fcbe3b-650a-4d4f-ac1e-7c565372acf8","block_type":"box","text":"Performance Oversight Committee.","page_number":23,"box":{"x":292,"y":295,"width":248,"height":12}},{"id":"f7d61553-89ba-4d6b-9e3a-fc4c1ddb973a","block_type":"box","text":"J. Phillip Holloman The Board benefits from J. 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Chief Compliance Officer of the","page_number":28,"box":{"x":486,"y":457,"width":379,"height":11}},{"id":"062eb0ac-953b-44c4-9ba2-3056a8b6d52c","block_type":"box","text":"BlackRock Multi-Asset Complex and the BlackRock","page_number":28,"box":{"x":487,"y":472,"width":364,"height":11}},{"id":"92f73beb-3410-4ec0-9b12-5e0a49253f5a","block_type":"box","text":"Fixed-Income Complex since 2026 and 2014-2023.","page_number":28,"box":{"x":487,"y":487,"width":361,"height":11}},{"id":"8d3b42d0-89f6-49c5-ae05-87d92a2727d7","block_type":"box","text":"Lisa Belle","page_number":28,"box":{"x":117,"y":509,"width":68,"height":9}},{"id":"9bfc26f6-1a6c-46a9-a2a4-252792e9c5fa","block_type":"box","text":"1968","page_number":28,"box":{"x":117,"y":524,"width":34,"height":9}},{"id":"00214d7c-a410-410d-9273-a431f0e19dbb","block_type":"box","text":"Anti-Money Laundering","page_number":28,"box":{"x":287,"y":509,"width":165,"height":12}},{"id":"9b631fc1-3489-4253-b680-c4b60fa870db","block_type":"box","text":"Compliance Officer","page_number":28,"box":{"x":288,"y":524,"width":136,"height":12}},{"id":"7ab334b8-74a8-43a0-8b9a-ee117db313ef","block_type":"box","text":"(Since 2020)","page_number":28,"box":{"x":288,"y":539,"width":89,"height":12}},{"id":"ef38878b-c1ff-4409-b031-7babeb4eb825","block_type":"box","text":"Managing Director of BlackRock, Inc. since 2019;","page_number":28,"box":{"x":487,"y":509,"width":347,"height":12}},{"id":"d6566708-b043-4b8b-bbf8-a4c103fcdce7","block_type":"box","text":"Global Financial Crime Head for Asset and Wealth","page_number":28,"box":{"x":487,"y":524,"width":356,"height":9}},{"id":"4d46ec09-d2aa-40bb-ad28-29e25a33fb44","block_type":"box","text":"Management of JP Morgan from 2013 to 2019.","page_number":28,"box":{"x":487,"y":539,"width":330,"height":12}},{"id":"1c8c21bd-0b7c-439f-af47-8c3a389752a1","block_type":"box","text":"Janey Ahn","page_number":28,"box":{"x":116,"y":562,"width":74,"height":11}},{"id":"c141c598-740b-4f8a-8cd5-411dbd2f40c7","block_type":"box","text":"1975","page_number":28,"box":{"x":117,"y":577,"width":34,"height":9}},{"id":"003a9c7b-1c16-4be3-b6a5-c2a180f95f92","block_type":"box","text":"Secretary","page_number":28,"box":{"x":288,"y":562,"width":68,"height":11}},{"id":"7c1f1422-1063-4714-9ccd-53723c0bc5c6","block_type":"box","text":"(Since 2020)","page_number":28,"box":{"x":288,"y":576,"width":89,"height":12}},{"id":"33c529d0-01a7-41c7-83a4-8866213bedcb","block_type":"box","text":"Managing Director of BlackRock, Inc. since 2018.","page_number":28,"box":{"x":487,"y":562,"width":347,"height":11}},{"id":"3c0c27b1-9a65-4630-812e-5ee69ac5bf4f","block_type":"box","text":"1","page_number":28,"box":{"x":144,"y":626,"width":2,"height":5}},{"id":"ea552031-4012-491d-98c1-095ca4abff7e","block_type":"box","text":"The address of each Officer is c/o BlackRock, Inc., 50 Hudson Yards, New York, New York 10001.","page_number":28,"box":{"x":170,"y":626,"width":584,"height":9}},{"id":"a0627cc4-1794-403d-86ab-992a922fdb47","block_type":"box","text":"2","page_number":28,"box":{"x":143,"y":641,"width":4,"height":5}},{"id":"e9d8996e-7cdd-4606-ab67-b893f8f380d0","block_type":"box","text":"Officers of the Trust serve at the pleasure of the Board.","page_number":28,"box":{"x":170,"y":641,"width":326,"height":10}},{"id":"a35c3f7e-f0d7-4678-83c6-9a97ab39d65d","block_type":"box","text":"Share Ownership","page_number":28,"box":{"x":116,"y":678,"width":137,"height":12}},{"id":"9bff7669-e85f-4bc2-869c-a93913dae791","block_type":"box","text":"Information relating to each Trustee’s share ownership in all BlackRock-advised Funds that are","page_number":28,"box":{"x":117,"y":701,"width":704,"height":12}},{"id":"7ac6e3b6-471f-4d99-8fcc-23f8e144b75e","block_type":"box","text":"currently overseen by the respective Trustee (“Supervised Funds”) as of December 31, 2025 is set","page_number":28,"box":{"x":116,"y":717,"width":732,"height":12}},{"id":"691884b3-38bf-4494-83d8-dcd9a03c34e0","block_type":"box","text":"forth in the chart below. Amounts shown may include shares as to which a Trustee has indirect","page_number":28,"box":{"x":116,"y":732,"width":704,"height":12}},{"id":"09362dd8-c2dd-46d5-827c-a8cd920c2d61","block_type":"box","text":"beneficial ownership, such as through participation in certain family accounts, 529 college savings plan","page_number":28,"box":{"x":117,"y":748,"width":762,"height":12}},{"id":"5a2f3230-28f1-45ae-bb14-3f0ab2f17f32","block_type":"box","text":"interests, or similar arrangements where the Trustee has beneficial economic interest but not a direct","page_number":28,"box":{"x":117,"y":763,"width":749,"height":12}},{"id":"192fce28-223c-4805-a3f3-0a00da157e41","block_type":"box","text":"ownership interest.","page_number":28,"box":{"x":116,"y":779,"width":139,"height":12}},{"id":"cf5b45c7-44d6-4fce-bd19-6f4080def9fd","block_type":"box","text":"23","page_number":28,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"9f63660c-f85d-4856-87a4-519c81682e60","block_type":"box","text":"NM0926U-5926888-28/257","page_number":28,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"ed75b51c-eb47-4246-a063-18abb7c351c1","block_type":"box","text":"Name","page_number":29,"box":{"x":261,"y":115,"width":35,"height":7}},{"id":"7dbf75b0-7bfc-46a1-a750-adec59b1fec5","block_type":"box","text":"Aggregate Dollar","page_number":29,"box":{"x":667,"y":84,"width":108,"height":9}},{"id":"4589cc9e-a476-47d3-a406-8bd053d7c7b0","block_type":"box","text":"Range of Equity","page_number":29,"box":{"x":671,"y":94,"width":101,"height":10}},{"id":"6db3d449-bb95-4c80-b3c2-c87b6a0a6c3c","block_type":"box","text":"Securities in","page_number":29,"box":{"x":681,"y":104,"width":79,"height":8}},{"id":"715f9054-07f4-4350-83cb-1edeaa80e59f","block_type":"box","text":"Supervised Funds*","page_number":29,"box":{"x":660,"y":115,"width":122,"height":9}},{"id":"356bd430-5678-44c6-b1ba-4773c51ff672","block_type":"box","text":"Independent Trustees:","page_number":29,"box":{"x":117,"y":134,"width":167,"height":11}},{"id":"96d5c085-f064-4c0b-aab3-116a3fac2d0f","block_type":"box","text":"Cynthia L. Egan Over $100,000","page_number":29,"box":{"x":117,"y":148,"width":664,"height":13}},{"id":"0c0d2dde-47fc-4cc2-9fbf-b27c9cdb8294","block_type":"box","text":"Lorenzo A. Flores Over $100,000","page_number":29,"box":{"x":117,"y":164,"width":664,"height":12}},{"id":"d60ac7f3-5d3a-4a86-a646-005115380288","block_type":"box","text":"Stayce D. Harris Over $100,000","page_number":29,"box":{"x":116,"y":179,"width":665,"height":13}},{"id":"d5bdb48a-86f5-4a60-b4bd-2df4ff2102cc","block_type":"box","text":"J. Phillip Holloman Over $100,000","page_number":29,"box":{"x":116,"y":195,"width":665,"height":12}},{"id":"61fa05fb-1cc3-40eb-bef6-cb277a848205","block_type":"box","text":"R. Glenn Hubbard Over $100,000","page_number":29,"box":{"x":117,"y":210,"width":664,"height":12}},{"id":"c8cb23b9-da13-473c-81f9-f187121589ef","block_type":"box","text":"W. Carl Kester Over $100,000","page_number":29,"box":{"x":116,"y":226,"width":665,"height":12}},{"id":"69deb8a3-06b4-49e4-8882-9e9e0d7e0ba3","block_type":"box","text":"Arthur P. Steinmetz Over $100,000","page_number":29,"box":{"x":116,"y":241,"width":665,"height":12}},{"id":"fe124bba-2546-4614-bd16-fa1321862191","block_type":"box","text":"Interested Trustees:","page_number":29,"box":{"x":117,"y":265,"width":148,"height":10}},{"id":"8765f5df-a206-4079-91fb-c50528d00f3d","block_type":"box","text":"Robert Fairbairn Over $100,000","page_number":29,"box":{"x":117,"y":280,"width":664,"height":12}},{"id":"690d5f28-b0b0-41db-9891-7cc162fd10f9","block_type":"box","text":"John M. Perlowski Over $100,000","page_number":29,"box":{"x":116,"y":296,"width":665,"height":12}},{"id":"260fe290-642f-4ddb-953f-d5693babdcac","block_type":"box","text":"* Includes share equivalents owned under the deferred compensation plan in the Supervised Funds by certain","page_number":29,"box":{"x":143,"y":346,"width":671,"height":10}},{"id":"8bfd0ebc-5672-4360-aa58-8a1e60ee56d2","block_type":"box","text":"Independent Trustees who have participated in the deferred compensation plan of the Supervised Funds.","page_number":29,"box":{"x":171,"y":359,"width":623,"height":9}},{"id":"91b0ac19-0608-470f-acef-58fac50eb871","block_type":"box","text":"As of December 31, 2025, none of the Independent Trustees of the Trust or their immediate family","page_number":29,"box":{"x":116,"y":388,"width":715,"height":12}},{"id":"3884bf81-c847-471e-826a-317a2de109c8","block_type":"box","text":"members owned beneficially or of record any securities of the Fund’s investment adviser, principal","page_number":29,"box":{"x":117,"y":403,"width":712,"height":12}},{"id":"f6b96ef9-b4cd-44c8-8cc8-1a2be41c5c01","block_type":"box","text":"underwriter, or any person directly or indirectly controlling, controlled by or under common control with","page_number":29,"box":{"x":117,"y":419,"width":740,"height":11}},{"id":"0d6ecc6c-e9dc-4f48-952f-0ac01961307d","block_type":"box","text":"such entities.","page_number":29,"box":{"x":116,"y":434,"width":94,"height":9}},{"id":"2d021334-0f72-4a1c-8f37-6170bc108344","block_type":"box","text":"Compensation of Trustees","page_number":29,"box":{"x":116,"y":472,"width":217,"height":12}},{"id":"ac0b2d79-e38d-4386-b69e-03855ea61e5a","block_type":"box","text":"Each Independent Trustee is paid an annual retainer of $370,000 per year for his or her services as a","page_number":29,"box":{"x":117,"y":495,"width":736,"height":12}},{"id":"5ff2dd69-a061-4a6e-9576-b1df34f0f43a","block_type":"box","text":"Board member of the BlackRock-advised Funds, including the Fund, together with out-of-pocket","page_number":29,"box":{"x":117,"y":511,"width":697,"height":12}},{"id":"8a9e312a-3a7e-46bf-a2a7-c5d3f47579f0","block_type":"box","text":"expenses in accordance with a Board policy on travel and other business expenses relating to","page_number":29,"box":{"x":116,"y":526,"width":684,"height":12}},{"id":"107c5c1a-661c-4f44-9edc-33232a6c05a7","block_type":"box","text":"attendance at meetings. In addition, the Chair of the Board and the Vice Chair of the Board are paid an","page_number":29,"box":{"x":116,"y":541,"width":747,"height":12}},{"id":"1d2a511b-df37-48c9-89e0-2abaf73d0d21","block_type":"box","text":"additional annual retainer of $140,000 and $84,000, respectively. The Chairs of the Audit Committee,","page_number":29,"box":{"x":116,"y":556,"width":734,"height":12}},{"id":"a7e24e32-5f30-4c5b-bead-99fa2c2f7047","block_type":"box","text":"Private Assets Committee, Performance Oversight Committee, Compliance Committee, Governance and","page_number":29,"box":{"x":117,"y":572,"width":761,"height":12}},{"id":"a3f274ad-5103-48df-8a05-52247ac0d2d2","block_type":"box","text":"Nominating Committee, and Securities Lending Committee are paid an additional annual retainer of","page_number":29,"box":{"x":117,"y":587,"width":723,"height":12}},{"id":"0bfd5473-125a-4a4a-8de6-1a9eb9a6f154","block_type":"box","text":"$55,000, $55,000, $42,500, $50,000, $42,500, and $5,000, respectively, in addition to the retainers that","page_number":29,"box":{"x":116,"y":601,"width":752,"height":13}},{"id":"01adc3d4-403a-4327-b75f-949cc841d54e","block_type":"box","text":"they each receive as a member of such committee. Each member (including the Chair) of the Audit","page_number":29,"box":{"x":116,"y":617,"width":719,"height":12}},{"id":"5cb31583-ea06-4803-9907-0261cbf29351","block_type":"box","text":"Committee, Private Assets Committee, Compliance Committee, Governance and Nominating Committee,","page_number":29,"box":{"x":117,"y":633,"width":764,"height":12}},{"id":"51ce043f-1b8a-42e0-bc43-8b6c816eb0d7","block_type":"box","text":"and Securities Lending Committee are paid an additional annual retainer of $30,000, $30,000, $25,000,","page_number":29,"box":{"x":116,"y":647,"width":752,"height":13}},{"id":"0570d3bd-95de-4c4b-bbcb-06b4ccb3e23d","block_type":"box","text":"$25,000, and $15,000, respectively, for his or her service on such committee. An Independent Trustee","page_number":29,"box":{"x":116,"y":662,"width":743,"height":13}},{"id":"e31e195e-cb01-49e3-9651-249421cbe5b3","block_type":"box","text":"may receive additional compensation for his or her service as a member or Chair, as applicable, of one","page_number":29,"box":{"x":117,"y":678,"width":748,"height":12}},{"id":"3796570c-a1ed-4827-ab2e-34b3514a5d53","block_type":"box","text":"or more ad hoc committees of the Board. The Fund will pay a pro rata portion quarterly (based on relative","page_number":29,"box":{"x":116,"y":694,"width":766,"height":12}},{"id":"55dd831d-ec78-40be-8461-e116bb50e62a","block_type":"box","text":"net assets) of the foregoing Trustee fees paid by the funds in the BlackRock Fixed-Income Complex.","page_number":29,"box":{"x":117,"y":709,"width":729,"height":12}},{"id":"98e7ed04-4713-4b57-ac29-99adafcd449f","block_type":"box","text":"The Independent Trustees have agreed that a maximum of 50% of each Independent Trustee’s total","page_number":29,"box":{"x":116,"y":740,"width":729,"height":12}},{"id":"1f1ea07e-9f42-4b87-b83b-cf159d8f789d","block_type":"box","text":"compensation paid by funds in the BlackRock Fixed-Income Complex may be deferred pursuant to the","page_number":29,"box":{"x":116,"y":755,"width":745,"height":12}},{"id":"d10ca36a-15cd-40fb-83cd-b6cbe49ecf61","block_type":"box","text":"BlackRock Fixed-Income Complex’s deferred compensation plan. Under the deferred compensation","page_number":29,"box":{"x":117,"y":770,"width":725,"height":12}},{"id":"8b689ea6-d923-47da-adbb-4040ecb0be54","block_type":"box","text":"plan, deferred amounts earn a return for the Independent Trustees as though equivalent dollar amounts","page_number":29,"box":{"x":117,"y":785,"width":752,"height":12}},{"id":"821aa3e5-4b67-4383-8650-6ecc3347d66a","block_type":"box","text":"had been invested in shares of certain funds in the BlackRock Fixed-Income Complex selected by the","page_number":29,"box":{"x":117,"y":801,"width":739,"height":11}},{"id":"13320b81-0f67-4547-8e3e-4191197e9f0d","block_type":"box","text":"Independent Trustees. This has approximately the same economic effect for the Independent Trustees","page_number":29,"box":{"x":117,"y":816,"width":745,"height":12}},{"id":"7191c86a-309a-4765-ba0a-8348aafb88aa","block_type":"box","text":"as if they had invested the deferred amounts in such funds in the BlackRock Fixed-Income Complex. The","page_number":29,"box":{"x":116,"y":831,"width":765,"height":12}},{"id":"db8c567d-4f43-498e-bceb-86c9f085006e","block_type":"box","text":"deferred compensation plan is not funded and obligations thereunder represent general unsecured","page_number":29,"box":{"x":116,"y":846,"width":717,"height":12}},{"id":"a125e41b-c60c-4fef-a43e-93be8e5fa845","block_type":"box","text":"claims against the general assets of a fund and are recorded as a liability for accounting purposes.","page_number":29,"box":{"x":116,"y":862,"width":716,"height":11}},{"id":"39506a79-755a-4bfd-8e47-7e534d07d070","block_type":"box","text":"24","page_number":29,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"60bb4886-d737-4b1c-97da-26ae0f58408d","block_type":"box","text":"NM0926U-5926888-29/257","page_number":29,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"3ff5917f-12b0-4f75-b3d7-c1a2d875219f","block_type":"box","text":"The following table sets forth the compensation paid to the","page_number":30,"box":{"x":116,"y":87,"width":440,"height":12}},{"id":"dd84a06c-81b5-4f94-acc1-253cc3567a4c","block_type":"box","text":"Trustees by the Trust, on behalf of the","page_number":30,"box":{"x":556,"y":87,"width":289,"height":12}},{"id":"1e0bdc1b-edfe-4491-bfd7-c520cd85e778","block_type":"box","text":"Fund, for the fiscal year ending April 30, 2026, and the aggregate compensation, including deferred","page_number":30,"box":{"x":117,"y":102,"width":742,"height":13}},{"id":"8a514e85-cc39-4931-ac0f-1215e38f9c5f","block_type":"box","text":"compensation amounts, paid to them by all BlackRock-advised Funds for the calendar year ended","page_number":30,"box":{"x":116,"y":118,"width":734,"height":12}},{"id":"1eb9a2f0-081a-4b4a-b1c3-59ce4d1177fe","block_type":"box","text":"December 31, 2025.","page_number":30,"box":{"x":117,"y":134,"width":156,"height":11}},{"id":"ef6a93fd-40f7-4393-af8c-0ce123e73854","block_type":"box","text":"Name","page_number":30,"box":{"x":243,"y":203,"width":35,"height":7}},{"id":"58790402-551d-493d-ab9a-ea8992ae9a0c","block_type":"box","text":"1","page_number":30,"box":{"x":280,"y":203,"width":2,"height":5}},{"id":"f62c0860-b751-43a4-8a04-e4ce303ec663","block_type":"box","text":"Estimated","page_number":30,"box":{"x":512,"y":182,"width":62,"height":8}},{"id":"225ccec5-a98b-42c8-bc07-cd815d4686dc","block_type":"box","text":"Compensation","page_number":30,"box":{"x":497,"y":192,"width":92,"height":10}},{"id":"c1fadff6-bcd6-4a39-8976-2a6e5f178894","block_type":"box","text":"from the Fund","page_number":30,"box":{"x":498,"y":203,"width":89,"height":7}},{"id":"38eaed1b-2bc3-4674-9213-89594a82d9bc","block_type":"box","text":"Estimated","page_number":30,"box":{"x":641,"y":172,"width":62,"height":7}},{"id":"48827507-844a-4810-ac27-91d53a71523a","block_type":"box","text":"Annual","page_number":30,"box":{"x":649,"y":182,"width":45,"height":8}},{"id":"797a27b0-3faa-4ed5-8d63-3f57439a77e1","block_type":"box","text":"Benefits upon","page_number":30,"box":{"x":628,"y":192,"width":88,"height":10}},{"id":"8d25d4b8-b465-4d19-bf47-7a4e3bf6ad3e","block_type":"box","text":"Retirement","page_number":30,"box":{"x":638,"y":203,"width":69,"height":7}},{"id":"0bedba3a-5ee7-4a6d-8772-95bb12cd7495","block_type":"box","text":"Aggregate","page_number":30,"box":{"x":785,"y":161,"width":66,"height":10}},{"id":"961e3a9d-5a38-46fa-a2b5-ac15776ef257","block_type":"box","text":"Compensation from","page_number":30,"box":{"x":755,"y":172,"width":126,"height":9}},{"id":"3d0fa9ed-ea70-4898-9dfc-3825cb35d999","block_type":"box","text":"the Fund and","page_number":30,"box":{"x":776,"y":182,"width":83,"height":8}},{"id":"411b5696-5902-4e3f-8292-e1a61d674ae9","block_type":"box","text":"Other BlackRock","page_number":30,"box":{"x":762,"y":192,"width":112,"height":8}},{"id":"1b546e24-aca0-48bf-84e5-c6afa43af793","block_type":"box","text":"Advised Funds","page_number":30,"box":{"x":763,"y":203,"width":97,"height":7}},{"id":"267644a9-6a70-4540-8923-973431d5b3ba","block_type":"box","text":"2,3","page_number":30,"box":{"x":860,"y":203,"width":12,"height":6}},{"id":"c297a162-c265-4ae9-abe1-5596a2b92f48","block_type":"box","text":"Independent Trustees","page_number":30,"box":{"x":117,"y":222,"width":162,"height":11}},{"id":"3245832c-42d6-49ee-b1c5-b756877f53fd","block_type":"box","text":"Cynthia L. Egan $820 None $580,000","page_number":30,"box":{"x":117,"y":236,"width":741,"height":13}},{"id":"fe918ab7-ded1-43de-9dec-0045dcc1b05c","block_type":"box","text":"Lorenzo A. Flores","page_number":30,"box":{"x":117,"y":253,"width":131,"height":9}},{"id":"a8f14894-9a68-4451-bff3-af53890d8061","block_type":"box","text":"4","page_number":30,"box":{"x":249,"y":253,"width":5,"height":6}},{"id":"babe9a1a-da68-41d8-a5dc-b7d81f9dd2cf","block_type":"box","text":"$701 None $400,000","page_number":30,"box":{"x":255,"y":252,"width":603,"height":12}},{"id":"e6264202-3730-43c6-8c3e-b90fcf8857e2","block_type":"box","text":"Stayce D. Harris $695 None $395,000","page_number":30,"box":{"x":116,"y":267,"width":742,"height":13}},{"id":"43f1bf28-94ea-42aa-8456-90f7a4c1e57b","block_type":"box","text":"J. Phillip Holloman $736 None $425,000","page_number":30,"box":{"x":116,"y":283,"width":742,"height":12}},{"id":"750ebe86-b5a9-4bb3-889a-6f8288bc851b","block_type":"box","text":"R. Glenn Hubbard $909 None $560,000","page_number":30,"box":{"x":117,"y":298,"width":741,"height":12}},{"id":"ef364b77-ab24-4015-b438-9bb04dafb059","block_type":"box","text":"W. Carl Kester $922 None $671,500","page_number":30,"box":{"x":116,"y":314,"width":742,"height":12}},{"id":"b8e22347-d6ef-4bd3-9f76-48988d18a5a5","block_type":"box","text":"Catherine A. Lynch","page_number":30,"box":{"x":117,"y":330,"width":141,"height":12}},{"id":"1b8b7688-d6de-4622-addd-daa7ad6f6ce3","block_type":"box","text":"5","page_number":30,"box":{"x":259,"y":330,"width":5,"height":6}},{"id":"e9de9eb5-a42c-430e-8d73-2fd03992e9b2","block_type":"box","text":"$769 None $610,000","page_number":30,"box":{"x":265,"y":329,"width":593,"height":12}},{"id":"29a51ca7-81fd-47b1-b0b3-61775732b738","block_type":"box","text":"Arthur P. Steinmetz","page_number":30,"box":{"x":116,"y":345,"width":145,"height":10}},{"id":"73c205fe-e6f3-48d1-82d5-5a21e26faadf","block_type":"box","text":"6","page_number":30,"box":{"x":262,"y":346,"width":5,"height":6}},{"id":"db450402-4bea-4a13-9915-26d3fdac5147","block_type":"box","text":"$770 None $537,500","page_number":30,"box":{"x":268,"y":345,"width":590,"height":12}},{"id":"6c666a0b-f7e9-4f58-872e-c111d8a9dec3","block_type":"box","text":"Interested Trustees","page_number":30,"box":{"x":117,"y":369,"width":144,"height":9}},{"id":"642e0d96-07db-406b-bc6b-20b6c3dbe2b2","block_type":"box","text":"Robert Fairbairn None None None","page_number":30,"box":{"x":117,"y":384,"width":726,"height":10}},{"id":"7be30e8a-9a2c-424d-8fcf-6aef2d56b26b","block_type":"box","text":"John M. Perlowski None None None","page_number":30,"box":{"x":116,"y":400,"width":727,"height":9}},{"id":"c7fd1073-7de9-4d37-853d-3fe18dc0ff98","block_type":"box","text":"1","page_number":30,"box":{"x":144,"y":449,"width":2,"height":5}},{"id":"c17932fb-0b71-405b-bd66-40c7b4775f83","block_type":"box","text":"For the number of BlackRock-advised Funds from which each Trustee receives compensation see the Biographical","page_number":30,"box":{"x":171,"y":449,"width":682,"height":10}},{"id":"098ff1fa-21be-4b95-8d2b-dfa116245891","block_type":"box","text":"Information Chart beginning on page 19.","page_number":30,"box":{"x":171,"y":462,"width":238,"height":10}},{"id":"f10a7b40-3d89-438d-b2d6-d8d0005e684a","block_type":"box","text":"2","page_number":30,"box":{"x":143,"y":478,"width":4,"height":5}},{"id":"0b733872-6a31-4f6c-8625-6ca9f94cd913","block_type":"box","text":"For the Independent Trustees, this amount represents the aggregate compensation earned from the funds in the","page_number":30,"box":{"x":171,"y":478,"width":666,"height":9}},{"id":"e5303b09-b3ef-4c6e-84f5-3d191f5b9d89","block_type":"box","text":"BlackRock Fixed-Income Complex during the calendar year ended December 31, 2025. Of this amount, Mr. Flores,","page_number":30,"box":{"x":171,"y":491,"width":682,"height":9}},{"id":"73651ba8-1a98-4c11-8e81-e1358c8aedcf","block_type":"box","text":"Ms. Harris, Mr. Holloman, Dr. Hubbard, Dr. Kester, Ms. Lynch and Mr. Steinmetz deferred $200,000, $197,500,","page_number":30,"box":{"x":171,"y":503,"width":657,"height":10}},{"id":"adc8a46d-faba-4a82-ba59-c629022c1fe2","block_type":"box","text":"$212,500, $280,000, $546,859, $603,900 and $268,750, respectively, pursuant to the BlackRock Fixed-Income","page_number":30,"box":{"x":170,"y":516,"width":660,"height":10}},{"id":"6352bac5-44f5-4cfb-8008-995f584f25e7","block_type":"box","text":"Complex’s deferred compensation plan.","page_number":30,"box":{"x":170,"y":529,"width":236,"height":10}},{"id":"a89b44e5-90f5-4401-9b5f-825330ad4e8b","block_type":"box","text":"3","page_number":30,"box":{"x":143,"y":545,"width":4,"height":5}},{"id":"caa9aac4-0f3f-4b2b-95be-e8de3ca5597a","block_type":"box","text":"Total amount of deferred compensation payable by the BlackRock Fixed-Income Complex to Mr. Flores, Ms. Harris,","page_number":30,"box":{"x":170,"y":545,"width":685,"height":10}},{"id":"0149886e-9fcc-4e03-b53f-09aabca2273c","block_type":"box","text":"Mr. Holloman, Dr. Hubbard, Dr. Kester, Ms. Lynch and Mr. Steinmetz","page_number":30,"box":{"x":171,"y":558,"width":408,"height":10}},{"id":"3ac71528-6fb5-4f09-8f99-f2d5c7fcdedf","block_type":"box","text":"is $1,055,218, $1,032,387, $1,101,752,","page_number":30,"box":{"x":584,"y":557,"width":232,"height":10}},{"id":"958d1254-8ade-4366-a77c-3e99ab566f91","block_type":"box","text":"$5,907,215, $2,544,830, $720,927 and $603,379,","page_number":30,"box":{"x":170,"y":570,"width":294,"height":10}},{"id":"03b44ee8-7871-4017-98e7-13aee83c33f9","block_type":"box","text":"respectively, as of December 31, 2025. Ms. Egan did not participate","page_number":30,"box":{"x":469,"y":571,"width":403,"height":9}},{"id":"55bb8c6e-0ef4-46b1-846f-893e7d9ebd67","block_type":"box","text":"in the deferred compensation plan as of December 31, 2025.","page_number":30,"box":{"x":170,"y":584,"width":360,"height":9}},{"id":"cda9934d-5eb5-4645-ad15-e65e0470dd9d","block_type":"box","text":"4","page_number":30,"box":{"x":143,"y":599,"width":4,"height":5}},{"id":"3d564da5-6e53-4ea6-a0c5-aa742a50617c","block_type":"box","text":"Mr. Flores became Chair of the Audit Committee effective as of March 9, 2026.","page_number":30,"box":{"x":171,"y":599,"width":466,"height":9}},{"id":"54647fbb-b033-4991-880a-1a5fa00d0646","block_type":"box","text":"5","page_number":30,"box":{"x":143,"y":615,"width":4,"height":5}},{"id":"61c87fcd-b864-497a-aa78-b7deee54d5e0","block_type":"box","text":"Ms. Lynch resigned as a Trustee of the Trust effective as of March 9, 2026.","page_number":30,"box":{"x":171,"y":615,"width":444,"height":9}},{"id":"067cea74-45c3-4294-8840-8f18372b6f43","block_type":"box","text":"6","page_number":30,"box":{"x":143,"y":630,"width":4,"height":5}},{"id":"3d4a5f7b-8c84-449c-a631-bf930fc54068","block_type":"box","text":"Mr. Steinmetz became Chair of the Securities Lending Committee effective as of May 20, 2026.","page_number":30,"box":{"x":171,"y":630,"width":564,"height":10}},{"id":"a1f667c8-4c20-4592-bf25-ca7d508ba734","block_type":"box","text":"Control Persons and Principal Holders of Securities.","page_number":30,"box":{"x":116,"y":659,"width":424,"height":12}},{"id":"e5bfe9e5-cfe5-4f6d-9f84-8eb8174c493e","block_type":"box","text":"As of August 5, 2026, the Trustees and","page_number":30,"box":{"x":540,"y":659,"width":296,"height":12}},{"id":"464bc5a6-bbdb-41c3-903f-d3b46683fd81","block_type":"box","text":"officers of the Trust as a group owned an aggregate of less than 1% of the outstanding shares of the","page_number":30,"box":{"x":116,"y":675,"width":746,"height":12}},{"id":"1d2319b4-6e45-4d11-a786-93f09477766c","block_type":"box","text":"Fund.","page_number":30,"box":{"x":117,"y":691,"width":40,"height":9}},{"id":"341e5c7a-d11f-4184-b4ba-d49d680b0eb8","block_type":"box","text":"Although the Trust does not have information concerning the beneficial ownership of shares held in the","page_number":30,"box":{"x":116,"y":721,"width":767,"height":12}},{"id":"01620060-8ceb-42ba-bdd7-d369ca88ba15","block_type":"box","text":"names of Depository Trust Company (“DTC”) Participants (as defined below), as of August 8, 2026, the","page_number":30,"box":{"x":117,"y":737,"width":766,"height":12}},{"id":"08cae891-4fcc-4439-8a2a-5af485e8c5d7","block_type":"box","text":"name and percentage ownership of each DTC Participant that owned of record 5% or more of the","page_number":30,"box":{"x":117,"y":752,"width":766,"height":12}},{"id":"3720a7fa-11be-45a2-a300-64f2d44861b3","block_type":"box","text":"outstanding shares of the Fund were as follows:","page_number":30,"box":{"x":116,"y":768,"width":355,"height":12}},{"id":"3481e46f-438b-4d0f-b938-7a58f2825728","block_type":"box","text":"Name","page_number":30,"box":{"x":117,"y":796,"width":35,"height":7}},{"id":"357c6ca1-a1c7-4869-b325-0f73d8aef9d0","block_type":"box","text":"Address","page_number":30,"box":{"x":496,"y":796,"width":53,"height":7}},{"id":"cfdcaf38-14f3-43ab-93b4-a5be218128d6","block_type":"box","text":"Percentage of Ownership","page_number":30,"box":{"x":694,"y":796,"width":161,"height":9}},{"id":"f076d00d-3c1b-49bb-8667-441071eebb58","block_type":"box","text":"NATIONAL FINANCIAL","page_number":30,"box":{"x":117,"y":814,"width":175,"height":10}},{"id":"3d1ea949-8302-4ff0-864f-2e2185238f72","block_type":"box","text":"SERVICES 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(collectively","page_number":31,"box":{"x":117,"y":299,"width":742,"height":12}},{"id":"c64cb8c0-9e6c-40e9-a32f-64ed4184d007","block_type":"box","text":"referred to in this section as “BlackRock”) and their respective directors, officers or employees, with","page_number":31,"box":{"x":116,"y":314,"width":742,"height":12}},{"id":"f3cee4d9-636d-4c0b-ac9f-b9ef987a0699","block_type":"box","text":"respect to the Fund and/or other accounts managed by BlackRock, may give rise to actual or","page_number":31,"box":{"x":116,"y":330,"width":695,"height":12}},{"id":"8b702dbd-29c0-4714-b818-f36adaa18a7c","block_type":"box","text":"perceived conflicts of interest such as those described below.","page_number":31,"box":{"x":116,"y":345,"width":461,"height":12}},{"id":"58928602-450f-4c68-a9f7-d211045218b9","block_type":"box","text":"BlackRock is one of the world’s largest asset management firms. BlackRock, its subsidiaries and their","page_number":31,"box":{"x":117,"y":377,"width":759,"height":13}},{"id":"276517d4-f15d-4178-b8d5-e751f8973757","block_type":"box","text":"respective directors, officers and employees, including the business units or entities and personnel","page_number":31,"box":{"x":117,"y":393,"width":736,"height":12}},{"id":"066c220e-4d6d-4bdd-92e8-a4633cb1a191","block_type":"box","text":"who may be involved in the investment activities and business operations of the Fund, are engaged","page_number":31,"box":{"x":116,"y":409,"width":744,"height":12}},{"id":"9a595b8c-9b05-4d56-8a25-cb5566d84159","block_type":"box","text":"worldwide in businesses, including managing equities, fixed income securities, cash and alternative","page_number":31,"box":{"x":116,"y":424,"width":742,"height":12}},{"id":"2fb0f459-b4ee-4e8c-b1ae-315af22de88c","block_type":"box","text":"investments, and other financial services, and have interests other than that of managing the Fund.","page_number":31,"box":{"x":117,"y":440,"width":740,"height":12}},{"id":"4697ee46-d74d-4075-bd8f-cf61379057ce","block_type":"box","text":"These are considerations of which investors in the Fund should be aware, and which may cause","page_number":31,"box":{"x":116,"y":455,"width":720,"height":12}},{"id":"479a0e0a-17cc-4345-a291-cc7de2a8a49a","block_type":"box","text":"conflicts of interest that could disadvantage the Fund and its shareholders. 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As such,","page_number":31,"box":{"x":117,"y":658,"width":693,"height":12}},{"id":"bac11e00-cbb7-4f98-9287-c8f8600fe865","block_type":"box","text":"BlackRock is or may be actively engaged in transactions in the same securities, currencies, and","page_number":31,"box":{"x":117,"y":673,"width":709,"height":12}},{"id":"def3716b-446a-4c00-85ab-0ae2710fd6d6","block_type":"box","text":"instruments in which the Fund invests.","page_number":31,"box":{"x":117,"y":689,"width":283,"height":9}},{"id":"4335213b-2e58-410b-8990-3f4e22521d7d","block_type":"box","text":"Such activities could affect the prices and availability of the securities, currencies, and instruments in","page_number":31,"box":{"x":116,"y":721,"width":746,"height":12}},{"id":"8d48afde-570c-452b-9fa8-cfbd4a697c0a","block_type":"box","text":"which the Fund invests, which could have an adverse impact on the Fund’s performance. Such","page_number":31,"box":{"x":116,"y":737,"width":704,"height":12}},{"id":"63d250d1-784d-4d73-be1c-815feb7c9644","block_type":"box","text":"transactions, particularly in respect of most proprietary accounts or client accounts, will be executed","page_number":31,"box":{"x":116,"y":752,"width":740,"height":12}},{"id":"3b329486-0f09-47f0-a42b-38d11046cfd2","block_type":"box","text":"independently of the Fund’s transactions and thus at prices or rates that may be more or less favorable","page_number":31,"box":{"x":117,"y":768,"width":764,"height":12}},{"id":"04b64562-7534-4a72-b8f3-4c4b1ca0a302","block_type":"box","text":"than those obtained by the Fund.","page_number":31,"box":{"x":116,"y":783,"width":244,"height":12}},{"id":"72b85775-5769-4fe4-b3cb-aa03533376f4","block_type":"box","text":"When BlackRock seeks to purchase or sell the same assets for client accounts, including the Fund, the","page_number":31,"box":{"x":116,"y":815,"width":765,"height":12}},{"id":"d1c55aa5-53b9-48eb-b3e2-f7f89cc78359","block_type":"box","text":"assets actually purchased or sold may be allocated among the accounts on a basis determined in its","page_number":31,"box":{"x":116,"y":831,"width":751,"height":12}},{"id":"22cffae6-9206-4507-a193-c4738aadeb72","block_type":"box","text":"good faith discretion to be equitable. In some cases, this system may adversely affect the size or price","page_number":31,"box":{"x":116,"y":846,"width":764,"height":12}},{"id":"49cc084e-d6c5-4508-82a3-3601ca40b58d","block_type":"box","text":"of the assets purchased or sold for the Fund. In addition, transactions in investments by one or more","page_number":31,"box":{"x":116,"y":862,"width":751,"height":12}},{"id":"dc11b9a2-49d7-47c9-ad7a-8b089d8284ee","block_type":"box","text":"other accounts managed by BlackRock may have the effect of diluting or otherwise disadvantaging the","page_number":31,"box":{"x":116,"y":877,"width":767,"height":12}},{"id":"5d986060-c70e-4c5f-92da-b112efc830bd","block_type":"box","text":"26","page_number":31,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"e53ebb35-c31f-4220-b995-c0c7e12a2da3","block_type":"box","text":"NM0926U-5926888-31/257","page_number":31,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"9da91a15-6db4-40a2-9093-a10052901b24","block_type":"box","text":"values, prices or investment strategies of the Fund, particularly, but not limited to, with respect to small","page_number":32,"box":{"x":116,"y":87,"width":766,"height":12}},{"id":"0fa4ada3-9c5e-43cc-8ba1-ed6d7fc4d306","block_type":"box","text":"capitalization, emerging market or less liquid strategies. This may occur with respect to BlackRock","page_number":32,"box":{"x":116,"y":103,"width":735,"height":12}},{"id":"14e5d753-ccfb-4b31-ac5c-4c2f49feb49b","block_type":"box","text":"advised accounts when investment decisions regarding the Fund are based on research or other","page_number":32,"box":{"x":116,"y":118,"width":723,"height":12}},{"id":"bb3342bc-5601-42d6-a019-597163187c3e","block_type":"box","text":"information that is also used to support decisions for other accounts. When BlackRock implements a","page_number":32,"box":{"x":117,"y":134,"width":749,"height":11}},{"id":"4b6cfa29-d881-4a40-80a5-25e2f0bf80fd","block_type":"box","text":"portfolio decision or strategy on behalf of another account ahead of, or contemporaneously with, similar","page_number":32,"box":{"x":117,"y":149,"width":771,"height":12}},{"id":"4f3e0fc3-e907-4641-91b2-8da0e79eb31e","block_type":"box","text":"decisions or strategies for the Fund, market impact, liquidity constraints, or other factors could result in","page_number":32,"box":{"x":116,"y":165,"width":765,"height":12}},{"id":"a298af84-914d-4019-b80e-5c59be688f40","block_type":"box","text":"the Fund receiving less favorable trading results and the costs of implementing such decisions or","page_number":32,"box":{"x":116,"y":180,"width":725,"height":12}},{"id":"bfe30220-e0aa-43b1-8915-378df7624880","block_type":"box","text":"strategies could be increased or the Fund could otherwise be disadvantaged. BlackRock may, in","page_number":32,"box":{"x":116,"y":196,"width":721,"height":12}},{"id":"c6a699a1-4ab6-4644-a5b9-41d660201b52","block_type":"box","text":"certain cases, elect to implement internal policies and procedures designed to limit such","page_number":32,"box":{"x":116,"y":211,"width":658,"height":12}},{"id":"930e1be8-f5c3-4ee8-b1e3-1e202ffa7e6e","block_type":"box","text":"consequences, which may cause the Fund to be unable to engage in certain activities, including","page_number":32,"box":{"x":116,"y":227,"width":717,"height":12}},{"id":"40214818-443b-4829-a716-0b39cfa41e73","block_type":"box","text":"purchasing or disposing of securities, when it might otherwise be desirable for it to do so. Conflicts may","page_number":32,"box":{"x":117,"y":242,"width":770,"height":12}},{"id":"4a63249f-0168-45cd-80c2-93073bfc4d66","block_type":"box","text":"also arise because portfolio decisions regarding the Fund may benefit other accounts managed by","page_number":32,"box":{"x":116,"y":258,"width":735,"height":12}},{"id":"5caabbd4-3b80-4c36-91ee-42f0c596b47c","block_type":"box","text":"BlackRock. For example, the sale of a long position or establishment of a short position by the Fund","page_number":32,"box":{"x":117,"y":273,"width":745,"height":12}},{"id":"a9433c88-f6fa-4e4c-a4a5-e22db2d17557","block_type":"box","text":"may impair the price of the same security sold short by (and therefore benefit) BlackRock or its other","page_number":32,"box":{"x":117,"y":289,"width":750,"height":12}},{"id":"359ce388-ab46-4d63-a5a7-f696f45c6886","block_type":"box","text":"accounts or funds, and the purchase of a security or covering of a short position in a security by the","page_number":32,"box":{"x":116,"y":304,"width":743,"height":12}},{"id":"137ab0ce-f76a-4661-a62c-e92821da2d40","block_type":"box","text":"Fund may increase the price of the same security held by (and therefore benefit) BlackRock or its other","page_number":32,"box":{"x":117,"y":320,"width":770,"height":12}},{"id":"f5cd1f0d-415b-40c8-a73e-fa7dbbdac104","block_type":"box","text":"accounts or funds.","page_number":32,"box":{"x":116,"y":335,"width":142,"height":10}},{"id":"009df1cb-9293-4b32-9e79-2e5657d3219b","block_type":"box","text":"BlackRock, on behalf of other client accounts, on the one hand, and the Fund, on the other hand, may","page_number":32,"box":{"x":117,"y":362,"width":761,"height":12}},{"id":"def7bfcd-4725-4982-b37b-c71fba5a8cf8","block_type":"box","text":"invest in or extend credit to different parts of the capital structure of a single issuer. BlackRock may","page_number":32,"box":{"x":117,"y":378,"width":739,"height":12}},{"id":"04acf96c-af0d-4edc-b82f-68b96e9267b4","block_type":"box","text":"pursue rights, provide advice or engage in other activities, or refrain from pursuing rights, providing","page_number":32,"box":{"x":117,"y":393,"width":737,"height":12}},{"id":"b93a1f75-edba-4996-8699-e2c90aa198f3","block_type":"box","text":"advice or engaging in other activities, on behalf of other clients with respect to an issuer in which the","page_number":32,"box":{"x":116,"y":409,"width":749,"height":12}},{"id":"fede3c7c-096d-48c5-bf2d-001529b6395d","block_type":"box","text":"Fund has invested, and such actions (or refraining from action) may have a material adverse effect on","page_number":32,"box":{"x":117,"y":424,"width":761,"height":12}},{"id":"b4ede6c4-a055-484d-a457-593e81ee2ded","block_type":"box","text":"the Fund. In situations in which clients of BlackRock (including the Fund) hold positions in multiple","page_number":32,"box":{"x":116,"y":440,"width":732,"height":12}},{"id":"c0a4b693-9724-4bcc-af32-ae159c23903b","block_type":"box","text":"parts of the capital structure of an issuer, BlackRock may not pursue certain actions or remedies that","page_number":32,"box":{"x":117,"y":455,"width":752,"height":12}},{"id":"b281fbae-b8c8-4704-9d28-938c2189da05","block_type":"box","text":"may be available to the Fund, as a result of legal and regulatory requirements or otherwise. BlackRock","page_number":32,"box":{"x":117,"y":471,"width":766,"height":12}},{"id":"b5012fb5-d2e7-4831-b724-a39e605bb9c2","block_type":"box","text":"addresses these and other potential conflicts of interest based on the facts and circumstances of","page_number":32,"box":{"x":116,"y":486,"width":722,"height":12}},{"id":"fec8ff0c-38ce-4155-ad7a-6942217fb1c0","block_type":"box","text":"particular situations. For example, BlackRock may determine to rely on information barriers between","page_number":32,"box":{"x":117,"y":502,"width":748,"height":12}},{"id":"402ee0ba-7c98-4bde-97e4-672c2613df43","block_type":"box","text":"different business units or portfolio management teams. BlackRock may also determine to rely on the","page_number":32,"box":{"x":116,"y":517,"width":757,"height":12}},{"id":"3d4f243d-d978-4b5a-9da4-c540a69331b4","block_type":"box","text":"actions of similarly situated holders of loans or securities rather than, or in connection with, taking such","page_number":32,"box":{"x":116,"y":533,"width":768,"height":12}},{"id":"76b09736-ad6d-4e13-ba25-b8165a525e9c","block_type":"box","text":"actions itself on behalf of the Fund.","page_number":32,"box":{"x":116,"y":548,"width":265,"height":10}},{"id":"0d7837b1-a04b-417f-8436-0695cdae9516","block_type":"box","text":"In addition, to the extent permitted by applicable law, the Fund may invest its assets in other funds","page_number":32,"box":{"x":117,"y":575,"width":733,"height":12}},{"id":"f126322a-077f-40c3-897e-422535955df0","block_type":"box","text":"advised by BlackRock, including funds that are managed by one or more of the same portfolio","page_number":32,"box":{"x":116,"y":591,"width":702,"height":12}},{"id":"f9097266-231d-415c-8d68-d1b06abe3760","block_type":"box","text":"managers, which could result in conflicts of interest relating to asset allocation, timing of Fund","page_number":32,"box":{"x":117,"y":606,"width":699,"height":12}},{"id":"8d875216-230d-4eb0-940f-29ce306193a3","block_type":"box","text":"purchases and redemptions, and increased remuneration and profitability for BlackRock and/or its","page_number":32,"box":{"x":117,"y":622,"width":730,"height":12}},{"id":"cfe6b8ed-5c75-4a21-9651-e67da2fce9b0","block_type":"box","text":"personnel, including portfolio managers.","page_number":32,"box":{"x":117,"y":637,"width":302,"height":12}},{"id":"14ba8b2f-4599-4432-960d-80740373c1fe","block_type":"box","text":"Third parties, including service providers to BlackRock or the Fund, may sponsor events (including, but","page_number":32,"box":{"x":116,"y":665,"width":764,"height":12}},{"id":"47c85c99-53a4-4408-a90d-e77bc83074d3","block_type":"box","text":"not limited to, marketing and promotional activities and presentations, educational training programs","page_number":32,"box":{"x":117,"y":680,"width":741,"height":12}},{"id":"a6af15ac-d0ec-41ec-914f-031e82d5816b","block_type":"box","text":"and conferences) for registered representatives, other professionals and individual investors. There is","page_number":32,"box":{"x":116,"y":696,"width":754,"height":12}},{"id":"de7541ee-692b-41fc-a2ff-6879795629f7","block_type":"box","text":"a potential conflict of interest as such sponsorships may defray the costs of such activities to","page_number":32,"box":{"x":116,"y":711,"width":686,"height":12}},{"id":"0718f2b4-c226-4044-9347-f72ad230e49c","block_type":"box","text":"BlackRock, and may provide an incentive to BlackRock to retain such third parties to provide services","page_number":32,"box":{"x":117,"y":727,"width":752,"height":12}},{"id":"5f10b9ca-9eb8-496d-aff1-453a1378091a","block_type":"box","text":"to the Fund.","page_number":32,"box":{"x":116,"y":742,"width":88,"height":10}},{"id":"e78cac14-af64-43e1-ab8f-2a123a69e8cd","block_type":"box","text":"In certain circumstances, BlackRock, on behalf of the Fund, may seek to buy from or sell securities to","page_number":32,"box":{"x":117,"y":769,"width":752,"height":12}},{"id":"b9c12d56-db4c-4817-ae20-6c2c21ff4865","block_type":"box","text":"another fund or account advised by BlackRock. BlackRock may (but is not required to) effect","page_number":32,"box":{"x":116,"y":785,"width":687,"height":12}},{"id":"b59fbcfa-47ad-4a8f-9dc5-1d34f1b82ced","block_type":"box","text":"purchases and sales between BlackRock clients (“cross trades”), including the Fund, if BlackRock","page_number":32,"box":{"x":117,"y":800,"width":726,"height":12}},{"id":"902a64a7-e2ec-4733-bb7e-f2c9b60e550c","block_type":"box","text":"believes such transactions are appropriate based on each party’s investment objectives and","page_number":32,"box":{"x":117,"y":816,"width":681,"height":12}},{"id":"a568a47d-68a4-4f85-a516-3891700a3487","block_type":"box","text":"guidelines, subject to applicable law and regulation. There may be potential conflicts of interest or","page_number":32,"box":{"x":116,"y":831,"width":728,"height":12}},{"id":"212748d6-6c99-41ed-b42b-cc05729ed0b4","block_type":"box","text":"regulatory issues relating to these transactions which could limit BlackRock’s decision to engage in","page_number":32,"box":{"x":117,"y":847,"width":738,"height":12}},{"id":"5c6d7b31-b650-44ce-be4f-d6711a67b0f6","block_type":"box","text":"these transactions for the Fund. BlackRock may have a potentially conflicting division of loyalties and","page_number":32,"box":{"x":116,"y":862,"width":755,"height":12}},{"id":"f34f849f-bc49-4aa2-b558-073c2b91f2e7","block_type":"box","text":"responsibilities to the parties in such transactions.","page_number":32,"box":{"x":117,"y":878,"width":374,"height":12}},{"id":"540fa7c8-0e3b-4492-9171-39e00277fbc8","block_type":"box","text":"27","page_number":32,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"437d7ed4-ccb6-4ca4-9c8f-2aca0baf0b66","block_type":"box","text":"NM0926U-5926888-32/257","page_number":32,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"880396b3-3f81-4653-a60c-d9b5a7683656","block_type":"box","text":"BlackRock and its clients may pursue or enforce rights with respect to an issuer in which the Fund has","page_number":33,"box":{"x":117,"y":87,"width":763,"height":12}},{"id":"2042070e-ede2-4fe3-8851-23b0a9d02d42","block_type":"box","text":"invested, and those activities may have an adverse effect on the Fund. As a result, prices, availability,","page_number":33,"box":{"x":117,"y":102,"width":760,"height":13}},{"id":"738fe71c-8de8-46e6-a5e3-c6204706d33a","block_type":"box","text":"liquidity and terms of the Fund’s investments may be negatively impacted by the activities of","page_number":33,"box":{"x":117,"y":118,"width":687,"height":12}},{"id":"f4c6937e-6012-4eb6-aa36-a43e54d18970","block_type":"box","text":"BlackRock or its clients, and transactions for the Fund may be impaired or effected at prices or terms","page_number":33,"box":{"x":117,"y":134,"width":753,"height":12}},{"id":"a9bd69ae-bcc0-46d4-aa67-2d2ab0759201","block_type":"box","text":"that may be less favorable than would otherwise have been the case.","page_number":33,"box":{"x":116,"y":149,"width":520,"height":12}},{"id":"f36e481f-510a-480a-8f3b-d0f2af6dc59b","block_type":"box","text":"The results of the Fund’s investment activities may differ significantly from the results achieved by","page_number":33,"box":{"x":116,"y":180,"width":731,"height":12}},{"id":"b5ac687f-4e55-4e0e-a57d-f20850f3abbf","block_type":"box","text":"BlackRock for its proprietary accounts or other accounts (including investment companies or collective","page_number":33,"box":{"x":117,"y":196,"width":763,"height":12}},{"id":"49e356f0-337a-4a3e-a544-d72b21e5e209","block_type":"box","text":"investment vehicles) that it manages or advises. It is possible that one or more accounts managed or","page_number":33,"box":{"x":117,"y":211,"width":754,"height":12}},{"id":"99b30065-0fed-4e03-a10b-759e5a54b6da","block_type":"box","text":"advised by BlackRock and such other accounts will achieve investment results that are substantially","page_number":33,"box":{"x":116,"y":227,"width":747,"height":12}},{"id":"ead84c63-fcf9-4b2b-83b2-e8ce64483414","block_type":"box","text":"more or less favorable than the results achieved by the Fund. Moreover, it is possible that the Fund will","page_number":33,"box":{"x":117,"y":242,"width":769,"height":12}},{"id":"66391f1e-7196-4f46-9220-85c9a59b7d1e","block_type":"box","text":"sustain losses during periods in which one or more proprietary or other accounts managed or advised","page_number":33,"box":{"x":116,"y":258,"width":759,"height":12}},{"id":"bd62a048-4ae0-4851-a20d-32c3ca3867c4","block_type":"box","text":"by BlackRock achieve significant profits. The opposite result is also possible.","page_number":33,"box":{"x":117,"y":273,"width":574,"height":12}},{"id":"39ea3969-8a2c-4dc0-9c52-055b5eb93ccf","block_type":"box","text":"From time to time, the Fund may be restricted from purchasing or selling securities, or from engaging","page_number":33,"box":{"x":117,"y":304,"width":754,"height":12}},{"id":"6fe4299f-ee0e-497d-a922-e75fe96f9add","block_type":"box","text":"in other investment activities because of regulatory, legal or contractual requirements applicable to","page_number":33,"box":{"x":117,"y":320,"width":735,"height":12}},{"id":"e32f8d46-b570-42ce-b9e2-8ff54d019a70","block_type":"box","text":"BlackRock or other accounts managed or advised by BlackRock, and/or the internal policies of","page_number":33,"box":{"x":117,"y":335,"width":706,"height":12}},{"id":"6acf868b-d91a-4ad0-bac8-d0a5f9139ba8","block_type":"box","text":"BlackRock designed to comply with such requirements. As a result, there may be periods, for example,","page_number":33,"box":{"x":117,"y":351,"width":769,"height":12}},{"id":"c285d98d-5e1b-41aa-bbbb-2394176fb421","block_type":"box","text":"when BlackRock will not initiate or recommend certain types of transactions regarding certain","page_number":33,"box":{"x":116,"y":366,"width":697,"height":12}},{"id":"e3eb7c89-8493-4a8a-9cd4-986653d93bad","block_type":"box","text":"securities or instruments with respect to which BlackRock is performing services or when position limits","page_number":33,"box":{"x":116,"y":382,"width":771,"height":12}},{"id":"6a45511c-0e1f-42f0-9098-de8831bb0fbd","block_type":"box","text":"have been reached. For example, the investment activities of BlackRock for its proprietary accounts","page_number":33,"box":{"x":117,"y":397,"width":745,"height":12}},{"id":"86e55a23-f66f-4e38-9a21-f42ff307b603","block_type":"box","text":"and accounts under its management may limit the investment opportunities for the Fund in certain","page_number":33,"box":{"x":116,"y":413,"width":732,"height":12}},{"id":"d6805fa7-6e80-449c-97b7-5218c3f47d85","block_type":"box","text":"emerging and other markets in which limitations are imposed upon the amount of investment, in the","page_number":33,"box":{"x":116,"y":428,"width":744,"height":12}},{"id":"5a1f2d1a-a742-4b6e-b835-8685fe6ece9e","block_type":"box","text":"aggregate or in individual issuers, by affiliated foreign investors.","page_number":33,"box":{"x":116,"y":444,"width":478,"height":12}},{"id":"9a1be9af-18aa-459b-949d-3b337213fbea","block_type":"box","text":"In connection with its management of the Fund, BlackRock may have access to certain fundamental","page_number":33,"box":{"x":117,"y":475,"width":747,"height":12}},{"id":"ec4ed520-087b-4398-892d-0dc33397cb74","block_type":"box","text":"analysis and proprietary technical models developed by BlackRock. BlackRock will not be under any","page_number":33,"box":{"x":116,"y":490,"width":750,"height":12}},{"id":"28cc7923-2330-462c-876a-f13cff467848","block_type":"box","text":"obligation, however, to effect transactions on behalf of the Fund in accordance with such analysis and","page_number":33,"box":{"x":116,"y":506,"width":760,"height":12}},{"id":"fb289a83-06cf-4b1a-b959-05826cc490a9","block_type":"box","text":"models. In addition, BlackRock will not have any obligation to make available any information regarding","page_number":33,"box":{"x":117,"y":521,"width":770,"height":12}},{"id":"5bc9fdd5-4b78-4ab7-8eaa-feb2122c8008","block_type":"box","text":"its proprietary activities or strategies, or the activities or strategies used for other accounts managed by","page_number":33,"box":{"x":117,"y":537,"width":769,"height":12}},{"id":"427cf1ab-8213-470d-a7b0-f8f0413214b0","block_type":"box","text":"them, for the benefit of the management of the Fund and it is not anticipated that BlackRock will have","page_number":33,"box":{"x":116,"y":552,"width":757,"height":12}},{"id":"786784b6-8f11-48f8-bf3c-ba237d871e8d","block_type":"box","text":"access to such information for the purpose of managing the Fund. The proprietary activities or portfolio","page_number":33,"box":{"x":116,"y":568,"width":767,"height":12}},{"id":"5ff02bea-93b6-40cc-beb5-ba32d5ae5d35","block_type":"box","text":"strategies of BlackRock, or the activities or strategies used for accounts managed by BlackRock or","page_number":33,"box":{"x":116,"y":583,"width":738,"height":12}},{"id":"f4a6e582-8971-478f-9e46-ae76e6a6a1dd","block_type":"box","text":"other client accounts could conflict with the transactions and strategies employed by BlackRock in","page_number":33,"box":{"x":116,"y":599,"width":731,"height":12}},{"id":"38465eb5-d9ed-4607-b627-acc2d5f7a219","block_type":"box","text":"managing the Fund.","page_number":33,"box":{"x":117,"y":614,"width":153,"height":12}},{"id":"d6c40b9e-5507-4ce9-9656-0f2defde8082","block_type":"box","text":"The Fund may be included in investment models developed by BlackRock for use by clients and","page_number":33,"box":{"x":116,"y":645,"width":719,"height":12}},{"id":"7b2b2208-a2a9-4180-a3f7-3a36ceb994db","block_type":"box","text":"financial advisors. To the extent clients invest in these investment models and increase the assets","page_number":33,"box":{"x":116,"y":661,"width":728,"height":9}},{"id":"0b4c27b5-8465-4a6f-b478-daaf197a85be","block_type":"box","text":"under management of the Fund, the investment management fee amounts paid by the Fund to","page_number":33,"box":{"x":117,"y":676,"width":702,"height":12}},{"id":"c3694412-ff13-4bcd-a453-3c22e6a5593f","block_type":"box","text":"BlackRock may also increase. The net asset value and liquidity of the Fund may be impacted by","page_number":33,"box":{"x":117,"y":692,"width":713,"height":12}},{"id":"98e1f55c-16a5-4ccc-a874-93004723f291","block_type":"box","text":"purchases and sales of the Fund by model-driven investment portfolios, as well as by BlackRock itself","page_number":33,"box":{"x":117,"y":707,"width":756,"height":12}},{"id":"b7cddb78-a9bb-4bda-a3d3-64b48d56dad1","block_type":"box","text":"and by its advisory clients.","page_number":33,"box":{"x":116,"y":723,"width":195,"height":12}},{"id":"e7ee49d0-d6e7-4dc2-8dad-cb78bf7f1566","block_type":"box","text":"In addition, certain principals and certain employees of the Fund’s investment adviser are also","page_number":33,"box":{"x":117,"y":754,"width":697,"height":12}},{"id":"0ddf3a84-14ac-48e3-bcdd-3bf00aa36975","block_type":"box","text":"principals or employees of other business units or entities within BlackRock. As a result, these","page_number":33,"box":{"x":117,"y":769,"width":697,"height":12}},{"id":"0ce54838-eaf5-495a-8876-7f8951064b20","block_type":"box","text":"principals and employees may have obligations to such other business units or entities or their clients","page_number":33,"box":{"x":117,"y":785,"width":751,"height":12}},{"id":"34115e07-d90b-4c42-96b9-bac61339f893","block_type":"box","text":"and such obligations to other business units or entities or their clients may be a consideration of which","page_number":33,"box":{"x":116,"y":800,"width":757,"height":12}},{"id":"fc99f5b5-85f0-430d-82a7-1009790f0e83","block_type":"box","text":"investors in the Fund should be aware.","page_number":33,"box":{"x":117,"y":816,"width":286,"height":9}},{"id":"b2d2f497-0826-46df-92ed-9ccc080b1a2a","block_type":"box","text":"BlackRock may enter into transactions and invest in securities, instruments and currencies on behalf of","page_number":33,"box":{"x":117,"y":847,"width":769,"height":12}},{"id":"4c36d20b-2c62-4aa6-9c32-212389a9d79a","block_type":"box","text":"the Fund in which clients of BlackRock, or, to the extent permitted by the SEC and applicable law,","page_number":33,"box":{"x":116,"y":862,"width":730,"height":12}},{"id":"15e0c1de-ab95-48ae-9b47-f54109b1ec9c","block_type":"box","text":"BlackRock, serves as the counterparty, principal or issuer. In such cases, such party’s interests in the","page_number":33,"box":{"x":117,"y":878,"width":758,"height":12}},{"id":"83a2dc57-20da-4f77-9be6-f0c9980bb001","block_type":"box","text":"28","page_number":33,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"215f1174-3643-4919-afc5-867b9bbd92b7","block_type":"box","text":"NM0926U-5926888-33/257","page_number":33,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"07d80457-7cb1-4922-86a3-611ff8d9e82c","block_type":"box","text":"transaction will be adverse to the interests of the Fund, and such party may have no incentive to","page_number":34,"box":{"x":116,"y":87,"width":718,"height":12}},{"id":"f1f6eb33-d42b-47ee-b006-7816fa750794","block_type":"box","text":"assure that the Fund obtains the best possible prices or terms in connection with the transactions. In","page_number":34,"box":{"x":116,"y":103,"width":750,"height":11}},{"id":"56eb20f7-6b35-4cb5-ba2c-0a308dcf5ffb","block_type":"box","text":"addition, the purchase, holding and sale of such investments by the Fund may enhance the profitability","page_number":34,"box":{"x":116,"y":118,"width":768,"height":12}},{"id":"60441715-f6b6-4177-8845-046cf502398a","block_type":"box","text":"of BlackRock.","page_number":34,"box":{"x":116,"y":134,"width":107,"height":9}},{"id":"db143d2b-f99a-49b6-bb61-183631a4d7e3","block_type":"box","text":"BlackRock may also create, write or issue derivatives for clients, the underlying securities, currencies","page_number":34,"box":{"x":117,"y":165,"width":755,"height":12}},{"id":"31cfb54b-40a7-4eac-b673-914796bc128f","block_type":"box","text":"or instruments of which may be those in which the Fund invests or which may be based on the","page_number":34,"box":{"x":116,"y":180,"width":706,"height":12}},{"id":"f7609e8c-cad0-4f05-91ed-39acbedd56cd","block_type":"box","text":"performance of the Fund. Additionally, an affiliate of BlackRock will create, write or issue options,","page_number":34,"box":{"x":117,"y":196,"width":724,"height":12}},{"id":"db9b18b2-f791-4fc1-96c5-b74d52f2c279","block_type":"box","text":"which may be based on the performance of the Fund. BlackRock has entered into an arrangement with","page_number":34,"box":{"x":116,"y":211,"width":771,"height":12}},{"id":"996a70c3-c169-4ad9-a5e9-9f5b87eaf1c7","block_type":"box","text":"Markit Indices Limited, the index provider for underlying fixed-income indexes used by certain iShares","page_number":34,"box":{"x":117,"y":227,"width":759,"height":12}},{"id":"d1d12adc-4d5c-4731-aa63-0c476fee53c4","block_type":"box","text":"ETFs, related to derivative fixed-income products that are based on such iShares ETFs. Trading","page_number":34,"box":{"x":117,"y":242,"width":718,"height":12}},{"id":"8e444af5-08c0-49d8-bca3-8ce794d368fb","block_type":"box","text":"activity in these derivative products could also potentially lead to greater liquidity for such products,","page_number":34,"box":{"x":116,"y":258,"width":739,"height":12}},{"id":"4e595cca-0acc-4380-a300-b33ce6046ad3","block_type":"box","text":"increased purchase activity with respect to these iShares ETFs and increased assets under","page_number":34,"box":{"x":117,"y":273,"width":684,"height":12}},{"id":"dbb13e11-0401-4f8f-9105-747d801aef26","block_type":"box","text":"management for BlackRock.","page_number":34,"box":{"x":117,"y":289,"width":215,"height":12}},{"id":"b756067c-c9b9-4061-b484-11afe6bded83","block_type":"box","text":"The Fund may, subject to applicable law, purchase investments that are the subject of an underwriting","page_number":34,"box":{"x":116,"y":320,"width":764,"height":12}},{"id":"5e29cb9e-cb4f-48f4-8ae2-0ce0b7beb8a5","block_type":"box","text":"or other distribution by BlackRock and may also enter into transactions with other clients of BlackRock","page_number":34,"box":{"x":116,"y":335,"width":763,"height":12}},{"id":"9c851ce5-7b96-4fc0-a2d6-3df74d1be9fe","block_type":"box","text":"where such other clients have interests adverse to those of the Fund. At times, these activities may","page_number":34,"box":{"x":116,"y":351,"width":741,"height":12}},{"id":"bfcde2fd-6577-48be-8489-3a9a6eba4439","block_type":"box","text":"cause business units or entities within BlackRock to give advice to clients that may cause these clients","page_number":34,"box":{"x":116,"y":366,"width":766,"height":12}},{"id":"b98e1228-5c16-4e06-8133-6dc6b7fb6019","block_type":"box","text":"to take actions adverse to the interests of the Fund. To the extent such transactions are permitted, the","page_number":34,"box":{"x":116,"y":382,"width":763,"height":12}},{"id":"9987e67a-2345-4d56-aae1-831a952288b0","block_type":"box","text":"Fund will deal with BlackRock on an arms-length basis.","page_number":34,"box":{"x":117,"y":397,"width":414,"height":12}},{"id":"276e7c24-9904-46ae-bd3c-54151649b5ac","block_type":"box","text":"To the extent authorized by applicable law, BlackRock may act as broker, dealer, agent, lender or","page_number":34,"box":{"x":116,"y":428,"width":729,"height":12}},{"id":"4e2d7709-f8e9-4793-b252-9d1026fc42fd","block_type":"box","text":"adviser or in other commercial capacities for the Fund. It is anticipated that the commissions,","page_number":34,"box":{"x":116,"y":444,"width":694,"height":12}},{"id":"1cb7d387-6552-4a02-a388-68388c5c52de","block_type":"box","text":"mark-ups, mark-downs, financial advisory fees, underwriting and placement fees, sales fees, financing","page_number":34,"box":{"x":117,"y":459,"width":764,"height":12}},{"id":"781282ca-5114-4eda-90df-5067742bd9e9","block_type":"box","text":"and commitment fees, brokerage fees, other fees, compensation or profits, rates, terms and conditions","page_number":34,"box":{"x":116,"y":475,"width":768,"height":12}},{"id":"5724a13d-48b6-4c67-8fc7-10c47d30b426","block_type":"box","text":"charged by BlackRock will be in its view commercially reasonable, although BlackRock, including its","page_number":34,"box":{"x":116,"y":490,"width":747,"height":12}},{"id":"abebb80c-315a-4198-bede-cc13622a4a10","block_type":"box","text":"sales personnel, will have an interest in obtaining fees and other amounts that are favorable to","page_number":34,"box":{"x":116,"y":506,"width":706,"height":12}},{"id":"41dbb885-1575-4c11-9ba1-6e5c656355bd","block_type":"box","text":"BlackRock and such sales personnel, which may have an adverse effect on the Fund. Index based","page_number":34,"box":{"x":117,"y":521,"width":738,"height":12}},{"id":"7faadeee-7d07-428f-ab67-265d074fddd1","block_type":"box","text":"funds may use an index provider that is affiliated with another service provider of the Fund or","page_number":34,"box":{"x":116,"y":537,"width":694,"height":12}},{"id":"02bfa777-889f-42a3-a778-d1aa0938c8cd","block_type":"box","text":"BlackRock that acts as a broker, dealer, agent, lender or in other commercial capacities for the Fund or","page_number":34,"box":{"x":117,"y":552,"width":770,"height":12}},{"id":"8b94ca42-de31-48bf-aff4-991be1557bcf","block_type":"box","text":"BlackRock.","page_number":34,"box":{"x":117,"y":568,"width":88,"height":9}},{"id":"e5da3380-5df5-40a0-938e-d1a6e560643a","block_type":"box","text":"Subject to applicable law, BlackRock (and its personnel and other distributors) will be entitled to retain","page_number":34,"box":{"x":116,"y":599,"width":761,"height":12}},{"id":"ea513c82-cc71-4de9-9447-05fea3e671ea","block_type":"box","text":"fees and other amounts that they receive in connection with their service to the Fund as broker, dealer,","page_number":34,"box":{"x":116,"y":614,"width":769,"height":12}},{"id":"73b47134-2c2b-4526-b375-463c505b3516","block_type":"box","text":"agent, lender, adviser or in other commercial capacities. No accounting to the Fund or its shareholders","page_number":34,"box":{"x":116,"y":630,"width":767,"height":12}},{"id":"bd1ae96e-b533-4269-9f23-6f88c416b7ac","block_type":"box","text":"will be required, and no fees or other compensation payable by the Fund or its shareholders will be","page_number":34,"box":{"x":116,"y":645,"width":739,"height":12}},{"id":"2fd7cb9c-487a-4957-a4f0-bf83e11ce1fd","block_type":"box","text":"reduced by reason of receipt by BlackRock of any such fees or other amounts.","page_number":34,"box":{"x":117,"y":661,"width":581,"height":12}},{"id":"fdb939f6-94f4-49bf-aa36-4fb7ccdc0aa1","block_type":"box","text":"When BlackRock acts as broker, dealer, agent, adviser or in other commercial capacities in relation to","page_number":34,"box":{"x":116,"y":692,"width":756,"height":12}},{"id":"402907aa-15c9-4b60-9933-0e41c0285fb4","block_type":"box","text":"the Fund, BlackRock may take commercial steps in its own interests, which may have an adverse","page_number":34,"box":{"x":116,"y":707,"width":724,"height":12}},{"id":"944ebcb2-3288-4efa-9445-41d2aeaae0e7","block_type":"box","text":"effect on the Fund.","page_number":34,"box":{"x":116,"y":723,"width":139,"height":9}},{"id":"c118c93d-1623-41ae-86a3-b907a0e10462","block_type":"box","text":"The Fund will be required to establish business relationships with its counterparties based on the","page_number":34,"box":{"x":116,"y":754,"width":718,"height":12}},{"id":"7544bc94-f04b-4c92-a5a3-740019945536","block_type":"box","text":"Fund’s own credit standing. BlackRock will not have any obligation to allow its credit to be used in","page_number":34,"box":{"x":117,"y":769,"width":722,"height":12}},{"id":"2689979f-4848-4686-9a53-d91725ca8a5e","block_type":"box","text":"connection with the Fund’s establishment of its business relationships, nor is it expected that the","page_number":34,"box":{"x":116,"y":785,"width":715,"height":12}},{"id":"9b5174f1-34f3-4179-bf6f-da3a719ef316","block_type":"box","text":"Fund’s counterparties will rely on the credit of BlackRock in evaluating the Fund’s creditworthiness.","page_number":34,"box":{"x":117,"y":800,"width":732,"height":12}},{"id":"f6aef97e-5ef8-43ca-ad8f-99110c955c0a","block_type":"box","text":"BlackRock Institutional Trust Company, N.A. (“BTC”), an affiliate of BFA, pursuant to SEC exemptive","page_number":34,"box":{"x":117,"y":831,"width":752,"height":12}},{"id":"ef0c04e5-cbb1-44e5-8346-5f29609234cd","block_type":"box","text":"relief, acts as securities lending agent to, and receives a share of securities lending revenues from, the","page_number":34,"box":{"x":117,"y":847,"width":767,"height":12}},{"id":"d17fcd8c-eae4-4c56-9b51-d16e84c198b2","block_type":"box","text":"Fund. BlackRock will also receive compensation for managing the reinvestment of the cash collateral","page_number":34,"box":{"x":117,"y":862,"width":754,"height":12}},{"id":"052966e9-4e98-43d7-8211-532b9e23fe2a","block_type":"box","text":"from securities lending. There are potential conflicts of interests in managing a securities lending","page_number":34,"box":{"x":116,"y":878,"width":721,"height":12}},{"id":"2764ce92-5fbd-4f06-89da-bc28ab2efc71","block_type":"box","text":"29","page_number":34,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"f42db2a8-7bdc-44ed-a533-1c0623af98f4","block_type":"box","text":"NM0926U-5926888-34/257","page_number":34,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"68ede3c8-5b2f-4ad5-a818-7c164c3a2c96","block_type":"box","text":"program, including but not limited to: (i) BlackRock as securities lending agent may have an incentive","page_number":35,"box":{"x":117,"y":87,"width":755,"height":12}},{"id":"25af9260-d707-4fc8-be94-90ad64e879c9","block_type":"box","text":"to, among other things, increase or decrease the amount of securities on loan or to lend particular","page_number":35,"box":{"x":116,"y":102,"width":731,"height":13}},{"id":"12eae935-635b-488c-a2de-a45874d16ee7","block_type":"box","text":"securities in order to generate additional risk-adjusted revenue for BlackRock and its affiliates; and","page_number":35,"box":{"x":116,"y":118,"width":736,"height":12}},{"id":"54789d99-f708-4482-8abb-c7e49b39232b","block_type":"box","text":"(ii) BlackRock as securities lending agent may have an incentive to allocate loans to clients that would","page_number":35,"box":{"x":117,"y":134,"width":761,"height":12}},{"id":"a1ca2918-841c-47d5-908d-b5f2f138fa29","block_type":"box","text":"provide more revenue to BlackRock. As described further below, BlackRock seeks to mitigate this","page_number":35,"box":{"x":117,"y":149,"width":729,"height":12}},{"id":"6fc02ca3-9c29-4e9d-9439-3b92ab937d8e","block_type":"box","text":"conflict by providing its securities lending clients with equal lending opportunities over time in order to","page_number":35,"box":{"x":116,"y":165,"width":755,"height":12}},{"id":"a1e22a11-855d-44c0-92e9-79c269766823","block_type":"box","text":"approximate pro rata allocation.","page_number":35,"box":{"x":116,"y":180,"width":240,"height":12}},{"id":"78edb54e-c736-430b-92ba-8ede9b0c4f90","block_type":"box","text":"As part of its securities lending program, BlackRock indemnifies the Fund and certain other clients and/","page_number":35,"box":{"x":116,"y":211,"width":766,"height":12}},{"id":"606b2670-f156-4a7e-b4f4-db2ee819dc57","block_type":"box","text":"or funds against a shortfall in collateral in the event of borrower default. On a regular basis, BlackRock","page_number":35,"box":{"x":116,"y":227,"width":764,"height":12}},{"id":"96c9c1cc-2f25-41dc-b55d-72bbd53be530","block_type":"box","text":"calculates the potential dollar exposure of collateral shortfall resulting from a borrower default (“shortfall","page_number":35,"box":{"x":116,"y":242,"width":772,"height":12}},{"id":"b3ac4673-eaed-4c99-84c3-f92f694a71b5","block_type":"box","text":"risk”) in the securities lending program. BlackRock establishes program-wide borrower limits (“credit","page_number":35,"box":{"x":117,"y":258,"width":745,"height":12}},{"id":"2d501505-bf15-4dd2-acee-2ce589299ff8","block_type":"box","text":"limits”) to actively manage borrower-specific credit exposure. BlackRock oversees the risk model that","page_number":35,"box":{"x":117,"y":273,"width":755,"height":12}},{"id":"7e67d058-fdcc-4840-9b83-dca145cfc7ca","block_type":"box","text":"calculates projected collateral shortfall values using loan-level factors such as loan and collateral type","page_number":35,"box":{"x":116,"y":289,"width":759,"height":12}},{"id":"9f562040-ee30-46c5-8fc4-5606536bafb4","block_type":"box","text":"and market value as well as specific borrower credit characteristics. When necessary, BlackRock may","page_number":35,"box":{"x":116,"y":304,"width":762,"height":12}},{"id":"6d9c2bad-6725-429a-89b3-c6932eeb2e4e","block_type":"box","text":"adjust securities lending program attributes by restricting eligible collateral or reducing borrower credit","page_number":35,"box":{"x":116,"y":320,"width":760,"height":12}},{"id":"beec2236-3fb6-4e79-bc37-cae90cdcdf8e","block_type":"box","text":"limits. As a result, the management of program-wide exposure as well as BlackRock-specific","page_number":35,"box":{"x":117,"y":335,"width":691,"height":12}},{"id":"49f05d7d-68b7-4c72-9348-fc77714f758d","block_type":"box","text":"indemnification exposure may affect the amount of securities lending activity BlackRock may conduct","page_number":35,"box":{"x":117,"y":351,"width":755,"height":12}},{"id":"ebf451b2-53b4-4a5c-a847-e4dc9fc5d9c9","block_type":"box","text":"at any given point in time by reducing the volume of lending opportunities for certain loans (including by","page_number":35,"box":{"x":116,"y":366,"width":771,"height":12}},{"id":"748b12d7-152f-4611-9372-eb761514fe87","block_type":"box","text":"asset type, collateral type and/or revenue profile).","page_number":35,"box":{"x":116,"y":382,"width":373,"height":12}},{"id":"b1814cc9-1095-4fb9-a0a7-f715157f1468","block_type":"box","text":"BlackRock may decline to make a securities loan on behalf of the Fund, discontinue lending on behalf","page_number":35,"box":{"x":117,"y":413,"width":759,"height":12}},{"id":"7ad9f8b7-a315-4e25-8906-c85ffeef2826","block_type":"box","text":"of the Fund or terminate a securities loan on behalf of the Fund for any reason, including but not limited","page_number":35,"box":{"x":116,"y":428,"width":772,"height":12}},{"id":"1ef9ea55-bdc1-4dfc-81c7-936ba70dc54c","block_type":"box","text":"to regulatory requirements and/or market rules, liquidity considerations, or credit considerations, which","page_number":35,"box":{"x":116,"y":444,"width":765,"height":12}},{"id":"54f12aeb-ba87-4749-b36d-7a95ec4a98b5","block_type":"box","text":"may impact the Fund by reducing or eliminating the volume of lending opportunities for certain types of","page_number":35,"box":{"x":117,"y":459,"width":766,"height":12}},{"id":"77300c75-c29d-400a-979c-a90ecfb1086f","block_type":"box","text":"loans, loans in particular markets, loans of particular securities or types of securities, or for loans","page_number":35,"box":{"x":117,"y":475,"width":720,"height":12}},{"id":"a11547d3-3dbf-42ff-88bc-df65421d1dbc","block_type":"box","text":"overall. In addition, some borrowers may prefer certain BlackRock lenders that provide additional","page_number":35,"box":{"x":116,"y":490,"width":725,"height":12}},{"id":"9a9109a6-3455-419c-8853-e97f1a492a0f","block_type":"box","text":"protections against lender default that are favored by their prudential regulation.","page_number":35,"box":{"x":117,"y":506,"width":596,"height":12}},{"id":"d1d7c697-37a7-4474-b70d-b6ea551b9e3c","block_type":"box","text":"BlackRock uses a predetermined systematic process in order to approximate pro rata allocation over","page_number":35,"box":{"x":117,"y":537,"width":752,"height":12}},{"id":"fe10ccd5-b943-4263-92b5-cbc8229f04d5","block_type":"box","text":"time. In order to allocate a loan to a portfolio: (i) BlackRock as a whole must have sufficient lending","page_number":35,"box":{"x":116,"y":552,"width":739,"height":12}},{"id":"d3e58524-3f32-49ae-8f47-c563b15eefb5","block_type":"box","text":"capacity pursuant to the various program limits (i.e. indemnification exposure limit and borrower credit","page_number":35,"box":{"x":116,"y":568,"width":760,"height":12}},{"id":"579afe24-ba34-4531-8dfd-8c82f068fced","block_type":"box","text":"limits); (ii) the lending portfolio must hold the asset at the time a loan opportunity arrives; and (iii) the","page_number":35,"box":{"x":117,"y":583,"width":747,"height":12}},{"id":"72ccef19-3cd3-491a-944c-a1ae64b54e57","block_type":"box","text":"lending portfolio must also have enough inventory, either on its own or when aggregated with other","page_number":35,"box":{"x":117,"y":599,"width":738,"height":12}},{"id":"57631b2a-279a-462b-b734-dd91e2681c4e","block_type":"box","text":"portfolios into one single market delivery, to satisfy the loan request. In doing so, BlackRock seeks to","page_number":35,"box":{"x":117,"y":614,"width":753,"height":12}},{"id":"c7d99ca5-2221-4fee-b395-04c2b44c2039","block_type":"box","text":"provide equal lending opportunities for all portfolios, independent of whether BlackRock indemnifies the","page_number":35,"box":{"x":117,"y":630,"width":770,"height":12}},{"id":"7b54a71a-68c6-4a23-96e4-094672183379","block_type":"box","text":"portfolio. Equal opportunities for lending portfolios does not guarantee equal outcomes. Specifically,","page_number":35,"box":{"x":117,"y":645,"width":744,"height":12}},{"id":"7d633152-7e6f-44bb-8273-4379d6553453","block_type":"box","text":"short and long-term outcomes for individual clients may vary due to asset mix, asset/liability spreads","page_number":35,"box":{"x":116,"y":661,"width":744,"height":12}},{"id":"cb585a81-58e5-4049-b8d7-e22eab28d20d","block_type":"box","text":"on different securities, and the overall limits imposed by the firm.","page_number":35,"box":{"x":116,"y":676,"width":477,"height":12}},{"id":"6e17573a-1320-4bf5-886a-a68870d7a83a","block_type":"box","text":"Purchases and sales of securities and other assets for the Fund may be bunched or aggregated with","page_number":35,"box":{"x":117,"y":707,"width":746,"height":12}},{"id":"90c0cbe2-cec4-49a9-b8f9-549f30019400","block_type":"box","text":"orders for other BlackRock client accounts, including with accounts that pay different transaction costs","page_number":35,"box":{"x":116,"y":723,"width":758,"height":12}},{"id":"9b8a1859-2535-482b-8039-69c49c7d5359","block_type":"box","text":"solely due to the fact that they have different research payment arrangements. BlackRock, however, is","page_number":35,"box":{"x":116,"y":738,"width":761,"height":12}},{"id":"7014bcfa-203b-4bfc-9d3c-42c97394a9e2","block_type":"box","text":"not required to bunch or aggregate orders if portfolio management decisions for different accounts are","page_number":35,"box":{"x":117,"y":754,"width":756,"height":12}},{"id":"917b2a05-6915-4549-84e9-5eea42a52111","block_type":"box","text":"made separately, or if they determine that bunching or aggregating is not practicable or required, or in","page_number":35,"box":{"x":117,"y":769,"width":754,"height":12}},{"id":"e83c6729-2199-4c1a-8e71-b1d65036f205","block_type":"box","text":"cases involving client direction.","page_number":35,"box":{"x":116,"y":785,"width":229,"height":12}},{"id":"d43712d3-06e9-408e-84bd-80b5d0cade2a","block_type":"box","text":"Prevailing trading activity frequently may make impossible the receipt of the same price or execution","page_number":35,"box":{"x":117,"y":816,"width":742,"height":12}},{"id":"b40a0147-c7bd-4d33-bdcc-3372d78b56ef","block_type":"box","text":"on the entire volume of securities purchased or sold. When this occurs, the various prices may be","page_number":35,"box":{"x":116,"y":831,"width":730,"height":12}},{"id":"85dd52a9-d617-4a58-b53d-3ec93e5f3f78","block_type":"box","text":"averaged, and the Fund will be charged or credited with the average price. Thus, the effect of the","page_number":35,"box":{"x":116,"y":847,"width":726,"height":12}},{"id":"cb46cd8d-75af-49a3-86e4-e84d907e2885","block_type":"box","text":"aggregation may operate on some occasions to the disadvantage of the Fund. In addition, under","page_number":35,"box":{"x":116,"y":862,"width":721,"height":12}},{"id":"388650a3-1641-470c-8d29-e4e03cf27bc4","block_type":"box","text":"30","page_number":35,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"fbc33155-5375-4b27-8cf9-796af2032c94","block_type":"box","text":"NM0926U-5926888-35/257","page_number":35,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"184f955a-de75-4b02-918d-ea5f1ec1f9bd","block_type":"box","text":"certain circumstances, the Fund will not be charged the same commission or commission equivalent","page_number":36,"box":{"x":116,"y":87,"width":750,"height":12}},{"id":"dae02da7-8e41-4677-9a25-55673f5d9831","block_type":"box","text":"rates in connection with a bunched or aggregated order.","page_number":36,"box":{"x":117,"y":103,"width":421,"height":12}},{"id":"218a92ef-5507-4773-8058-62f46e4044d5","block_type":"box","text":"BlackRock, unless prohibited by applicable law, may cause the Fund or account to pay a broker or","page_number":36,"box":{"x":117,"y":131,"width":734,"height":12}},{"id":"3fe12c3c-cc8c-4648-82f6-5fa77164e9ae","block_type":"box","text":"dealer a commission for effecting a transaction that exceeds the amount another broker or dealer","page_number":36,"box":{"x":116,"y":146,"width":727,"height":12}},{"id":"f0551dbe-3b70-4e81-921e-743931826d12","block_type":"box","text":"would have charged for effecting the same transaction in recognition of the value of brokerage and","page_number":36,"box":{"x":116,"y":161,"width":737,"height":13}},{"id":"f69868c6-5fb1-4684-a924-23cbb361b54e","block_type":"box","text":"research services provided by that broker or dealer. Under the European Union Markets in Financial","page_number":36,"box":{"x":117,"y":177,"width":747,"height":12}},{"id":"ea103d0d-9166-454b-bfee-8c769c9d028d","block_type":"box","text":"Instruments Directive (Directive 2014/65/EU) and Markets in Financial Instruments Regulation","page_number":36,"box":{"x":117,"y":192,"width":701,"height":13}},{"id":"7fc670e8-6d41-4f12-a690-5f77e76d4ec1","block_type":"box","text":"(Regulation (EU) No 600/2014), EU investment managers, including BlackRock International Limited,","page_number":36,"box":{"x":117,"y":208,"width":754,"height":12}},{"id":"d85993d8-858a-4e2e-9414-ac1e98c2ba4e","block_type":"box","text":"pay for research from brokers and dealers directly out of their own resources, rather than through client","page_number":36,"box":{"x":117,"y":223,"width":770,"height":13}},{"id":"4ae9fe16-f979-4a0d-9a41-cea9f6209a1b","block_type":"box","text":"commissions.","page_number":36,"box":{"x":116,"y":239,"width":106,"height":9}},{"id":"2049a5b3-74d2-44b7-b25e-c10ee309cf5b","block_type":"box","text":"Subject to applicable law, BlackRock may select brokers that furnish BlackRock, the Fund, other","page_number":36,"box":{"x":116,"y":267,"width":720,"height":12}},{"id":"7da7e9fe-23c7-4d46-aead-46fe22fa60eb","block_type":"box","text":"BlackRock client accounts or personnel, directly or through correspondent relationships, with research","page_number":36,"box":{"x":117,"y":282,"width":762,"height":12}},{"id":"4865a8cd-035b-470b-8ff6-4a0dff356d44","block_type":"box","text":"or other appropriate services which provide, in BlackRock’s view, appropriate assistance to BlackRock","page_number":36,"box":{"x":116,"y":298,"width":765,"height":12}},{"id":"48b99ea0-39a7-4c6d-96d1-d0adfa7a7e12","block_type":"box","text":"in the investment decision-making process (including with respect to futures, fixed-price offerings and","page_number":36,"box":{"x":117,"y":313,"width":756,"height":12}},{"id":"258c7231-ce0b-4a11-a2d0-2f2c686a8b95","block_type":"box","text":"OTC transactions). Such research or other services may include, to the extent permitted by law,","page_number":36,"box":{"x":116,"y":329,"width":717,"height":12}},{"id":"cb124278-c0ea-43de-97d5-f6261b32fe04","block_type":"box","text":"research reports on companies, industries and securities; economic and financial data; financial","page_number":36,"box":{"x":117,"y":344,"width":714,"height":12}},{"id":"1eeaed1c-d652-40b4-84b1-e9d6d5d4f83b","block_type":"box","text":"publications; proxy analysis; trade industry seminars; computer data bases; research-oriented software","page_number":36,"box":{"x":117,"y":360,"width":769,"height":12}},{"id":"6696ef52-1440-4a8c-b110-26a0a4f11255","block_type":"box","text":"and other services and products.","page_number":36,"box":{"x":116,"y":376,"width":249,"height":11}},{"id":"acdbdc27-0a22-410e-b648-9ee2f23778fa","block_type":"box","text":"Research or other services obtained in this manner may be used in servicing any or all of the Fund and","page_number":36,"box":{"x":117,"y":403,"width":770,"height":12}},{"id":"2a49a781-cceb-4bd4-9434-63463a789a6f","block_type":"box","text":"other BlackRock client accounts, including in connection with BlackRock client accounts other than","page_number":36,"box":{"x":116,"y":419,"width":738,"height":12}},{"id":"947cd537-41c5-4319-9468-5709fd6d2c59","block_type":"box","text":"those that pay commissions to the broker relating to the research or other service arrangements. Such","page_number":36,"box":{"x":116,"y":434,"width":766,"height":12}},{"id":"332145f2-cc01-4edd-bd26-750eb2e05ac4","block_type":"box","text":"products and services may disproportionately benefit other BlackRock client accounts relative to the","page_number":36,"box":{"x":117,"y":450,"width":745,"height":12}},{"id":"083c7211-6fbe-455c-a3ac-73bbe08110a2","block_type":"box","text":"Fund based on the amount of brokerage commissions paid by the Fund and such other BlackRock","page_number":36,"box":{"x":117,"y":465,"width":736,"height":12}},{"id":"5ba81ac5-53ed-4b57-a2f1-46aeb01e5bcd","block_type":"box","text":"client accounts. For example, research or other services that are paid for through one client’s","page_number":36,"box":{"x":116,"y":481,"width":696,"height":12}},{"id":"777e25d8-67e2-4a4c-84f5-3ff1faf04c30","block_type":"box","text":"commissions may not be used in managing that client’s account. In addition, other BlackRock client","page_number":36,"box":{"x":116,"y":496,"width":743,"height":12}},{"id":"2ee54896-691f-4046-9d94-971f0dbe8c72","block_type":"box","text":"accounts may receive the benefit, including disproportionate benefits, of economies of scale or price","page_number":36,"box":{"x":116,"y":512,"width":748,"height":12}},{"id":"f2b05b31-8ea9-430a-bb20-ef043b844ea5","block_type":"box","text":"discounts in connection with products and services that may be provided to the Fund and to such other","page_number":36,"box":{"x":116,"y":527,"width":769,"height":12}},{"id":"3248b9f8-6177-4521-9183-fa6598523049","block_type":"box","text":"BlackRock client accounts. To the extent that BlackRock uses soft dollars, it will not have to pay for","page_number":36,"box":{"x":117,"y":543,"width":740,"height":12}},{"id":"9514977d-4bd7-4674-ac1b-8abd37ec40fe","block_type":"box","text":"those products and services itself.","page_number":36,"box":{"x":116,"y":558,"width":258,"height":12}},{"id":"6b6c7a84-9a86-4f6a-9006-d6abd58c740b","block_type":"box","text":"BlackRock, unless prohibited by applicable law, may endeavor to execute trades through brokers who,","page_number":36,"box":{"x":117,"y":586,"width":765,"height":12}},{"id":"b3e248a9-3bd4-43e1-8dce-eef969196f49","block_type":"box","text":"pursuant to such arrangements, provide research or other services in order to ensure the continued","page_number":36,"box":{"x":117,"y":602,"width":743,"height":12}},{"id":"dcdef90a-e57c-49bc-942f-d5e1cf073eb7","block_type":"box","text":"receipt of research or other services BlackRock believes are useful in its investment decision-making","page_number":36,"box":{"x":117,"y":617,"width":753,"height":12}},{"id":"2ce435c1-c2ef-4e74-b38d-39a825e48915","block_type":"box","text":"process. BlackRock may from time to time choose not to engage in the above described arrangements","page_number":36,"box":{"x":117,"y":633,"width":767,"height":12}},{"id":"d2f26a23-bf25-4019-a21e-27d33ade5b6d","block_type":"box","text":"to varying degrees. BlackRock, unless prohibited by applicable law, may also enter into commission","page_number":36,"box":{"x":116,"y":648,"width":746,"height":12}},{"id":"41b60147-15f7-4211-a38d-97c5ea484048","block_type":"box","text":"sharing arrangements under which BlackRock may execute transactions through a broker-dealer and","page_number":36,"box":{"x":116,"y":664,"width":751,"height":12}},{"id":"e8cd8588-c1ba-4017-b7f7-a98975eeb5eb","block_type":"box","text":"request that the broker-dealer allocate a portion of the commissions or commission credits to another","page_number":36,"box":{"x":117,"y":679,"width":750,"height":12}},{"id":"c63e78d1-db64-4ffa-8088-6de6286061b4","block_type":"box","text":"firm that provides research to BlackRock. To the extent that BlackRock engages in commission sharing","page_number":36,"box":{"x":116,"y":695,"width":766,"height":12}},{"id":"b8791e26-23f3-439f-92b4-66ebbd58cb1f","block_type":"box","text":"arrangements, many of the same conflicts related to traditional soft dollars may exist.","page_number":36,"box":{"x":116,"y":710,"width":630,"height":12}},{"id":"f8e205f4-ce5a-4b63-865d-42d84aa2710c","block_type":"box","text":"BlackRock may utilize certain electronic crossing networks (“ECNs”) (including, without limitation,","page_number":36,"box":{"x":117,"y":738,"width":718,"height":12}},{"id":"34dc32cc-804d-41da-a4a1-c7832d7d0f5c","block_type":"box","text":"ECNs in which BlackRock has an investment or other interest, to the extent permitted by applicable","page_number":36,"box":{"x":117,"y":754,"width":736,"height":12}},{"id":"f5f27791-14eb-47ee-9a37-fcacb253979a","block_type":"box","text":"law) in executing client securities transactions for certain types of securities. These ECNs may charge","page_number":36,"box":{"x":117,"y":769,"width":755,"height":12}},{"id":"e34f02fd-43a1-49c7-9e28-907ff1e7cca4","block_type":"box","text":"fees for their services, including access fees and transaction fees. The transaction fees, which are","page_number":36,"box":{"x":116,"y":785,"width":728,"height":12}},{"id":"7749478b-5d17-4aba-ba6a-a6c6a6f3f825","block_type":"box","text":"similar to commissions or markups/markdowns, will generally be charged to clients and, like","page_number":36,"box":{"x":116,"y":800,"width":681,"height":12}},{"id":"b8acb3d2-109d-486f-b085-644ec9dc9fb5","block_type":"box","text":"commissions and markups/markdowns, would generally be included in the cost of the securities","page_number":36,"box":{"x":116,"y":816,"width":710,"height":12}},{"id":"22bd6308-5ce9-4a86-b659-40c5d5ca9bfe","block_type":"box","text":"purchased. Access fees may be paid by BlackRock even though incurred in connection with executing","page_number":36,"box":{"x":117,"y":831,"width":763,"height":12}},{"id":"478b3ce3-9700-457b-9490-d7ae46bc5aa3","block_type":"box","text":"transactions on behalf of clients, including the Fund. In certain circumstances, ECNs may offer volume","page_number":36,"box":{"x":116,"y":847,"width":765,"height":12}},{"id":"f60cec8a-85fc-490b-8b83-3c55460dbb32","block_type":"box","text":"discounts that will reduce the access fees typically paid by BlackRock. BlackRock will only utilize ECNs","page_number":36,"box":{"x":116,"y":862,"width":770,"height":12}},{"id":"61dcf50d-6c39-4e33-a809-84ce975dcd68","block_type":"box","text":"consistent with its obligation to seek to obtain best execution in client transactions.","page_number":36,"box":{"x":116,"y":878,"width":616,"height":12}},{"id":"2c098f50-3497-45e6-861b-96395d2f69c1","block_type":"box","text":"31","page_number":36,"box":{"x":491,"y":909,"width":15,"height":9}},{"id":"af0d38a6-285f-4d67-98bb-1a3458a76232","block_type":"box","text":"NM0926U-5926888-36/257","page_number":36,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"a05a7647-8d38-4010-9208-870ca7f09792","block_type":"box","text":"BlackRock owns a minority interest in, and is a member of, Members Exchange (“MEMX”), a newly","page_number":37,"box":{"x":117,"y":87,"width":739,"height":12}},{"id":"0bf06dd6-0a9c-40db-b50c-d242a28e3e98","block_type":"box","text":"created U.S. stock exchange. Transactions for the Fund may be executed on MEMX if third party","page_number":37,"box":{"x":116,"y":102,"width":725,"height":13}},{"id":"7b9760ce-b025-4990-be9c-826afa7b73e6","block_type":"box","text":"brokers select MEMX as the appropriate venue for execution of orders placed by BlackRock traders on","page_number":37,"box":{"x":117,"y":118,"width":768,"height":12}},{"id":"aa25c50b-462f-4bc2-9ff9-7943d7af7cdf","block_type":"box","text":"behalf of the Fund. In addition, transactions in Fund shares may be executed on MEMX if third party","page_number":37,"box":{"x":117,"y":134,"width":746,"height":12}},{"id":"5c96c000-5e77-4ff2-be2e-5a4f12b3a6bd","block_type":"box","text":"brokers select MEMX as the appropriate venue for the execution of such orders.","page_number":37,"box":{"x":117,"y":149,"width":600,"height":12}},{"id":"9ba1e991-4a3b-451a-8b35-9e7b12477eb0","block_type":"box","text":"BlackRock has adopted policies and procedures designed to prevent conflicts of interest from","page_number":37,"box":{"x":117,"y":180,"width":697,"height":12}},{"id":"ba645d6b-d40e-4431-ac4e-2c4a18f15b8d","block_type":"box","text":"influencing proxy voting decisions that it makes on behalf of advisory clients, including the Fund, and to","page_number":37,"box":{"x":117,"y":196,"width":769,"height":12}},{"id":"e4d826dc-54ab-46c1-a231-5c734aecf70e","block_type":"box","text":"help ensure that such decisions are made in accordance with BlackRock’s fiduciary obligations to its","page_number":37,"box":{"x":117,"y":211,"width":748,"height":12}},{"id":"dfab9782-2974-46fe-86e1-0765a5ea92a9","block_type":"box","text":"clients. Nevertheless, notwithstanding such proxy voting policies and procedures, actual proxy voting","page_number":37,"box":{"x":116,"y":227,"width":754,"height":12}},{"id":"dd9d7fb6-37f8-4162-b2a4-0d2d7baa02b7","block_type":"box","text":"decisions of BlackRock may have the effect of favoring the interests of other clients or businesses of","page_number":37,"box":{"x":116,"y":242,"width":750,"height":12}},{"id":"b9990b78-392a-4353-8f2b-01b09298b1c3","block_type":"box","text":"other divisions or units of BlackRock, provided that BlackRock believes such voting decisions to be in","page_number":37,"box":{"x":116,"y":258,"width":756,"height":12}},{"id":"ed03729d-0423-4c08-af35-761252a2c040","block_type":"box","text":"accordance with its fiduciary obligations. For a more detailed discussion of these policies and","page_number":37,"box":{"x":116,"y":273,"width":696,"height":12}},{"id":"9d71d37b-6d43-40ee-9ad1-197efe42261b","block_type":"box","text":"procedures, see the Proxy Voting Policy section in this SAI.","page_number":37,"box":{"x":117,"y":289,"width":445,"height":12}},{"id":"b098d4eb-fa9d-4d4a-a6c1-00fcaa378de4","block_type":"box","text":"It is also possible that, from time to time, BlackRock and/or its advisory clients (including other funds","page_number":37,"box":{"x":117,"y":320,"width":747,"height":12}},{"id":"094b97ab-adb9-45d7-8493-edb69a1c6b28","block_type":"box","text":"and separately managed accounts) may, subject to compliance with applicable law, purchase and hold","page_number":37,"box":{"x":116,"y":335,"width":768,"height":12}},{"id":"1aa7db33-119b-4c1d-8fcf-2cf89bfd93e7","block_type":"box","text":"shares of the Fund. Increasing the Fund’s assets may enhance investment flexibility and diversification","page_number":37,"box":{"x":116,"y":351,"width":768,"height":12}},{"id":"67364d75-4cec-403a-b79d-484a6e9dd23c","block_type":"box","text":"and may contribute to economies of scale that tend to reduce the Fund’s expense ratio. BlackRock","page_number":37,"box":{"x":116,"y":366,"width":738,"height":12}},{"id":"b922e727-a1da-490c-ba4c-05d269c4cf62","block_type":"box","text":"reserves the right, subject to compliance with applicable law, to sell into the market or redeem in","page_number":37,"box":{"x":117,"y":382,"width":718,"height":12}},{"id":"fe986413-23a7-482b-8702-62ce82bb4ce9","block_type":"box","text":"Creation Units through an Authorized Participant at any time some or all of the shares of the Fund","page_number":37,"box":{"x":117,"y":397,"width":731,"height":12}},{"id":"e7d8b26c-434f-4460-8429-84b78c3e5d9f","block_type":"box","text":"acquired for its own accounts or the account of a BlackRock advisory client. A large sale or redemption","page_number":37,"box":{"x":116,"y":413,"width":769,"height":12}},{"id":"62d3a46f-ebe7-46f5-bcee-d92e42944c59","block_type":"box","text":"of shares of the Fund by BlackRock itself or a BlackRock advisory client could significantly reduce the","page_number":37,"box":{"x":116,"y":428,"width":759,"height":12}},{"id":"43d905e1-ada4-498a-b6e9-4c576d4b08f1","block_type":"box","text":"asset size of the Fund, which might have an adverse effect on the Fund’s liquidity, investment","page_number":37,"box":{"x":116,"y":444,"width":701,"height":12}},{"id":"23e85d78-05b3-4378-9c11-6a1ac97942e6","block_type":"box","text":"flexibility, portfolio diversification, expense ratio or ability to comply with the listing requirements for the","page_number":37,"box":{"x":116,"y":459,"width":764,"height":12}},{"id":"31a329ea-7a2d-43e0-b890-a2bc9f5b9d84","block_type":"box","text":"Fund.","page_number":37,"box":{"x":117,"y":475,"width":46,"height":9}},{"id":"72bc7432-efbd-4811-a79c-6c6eeef1d14e","block_type":"box","text":"It is possible that the Fund may invest in securities of, or engage in transactions with, companies in","page_number":37,"box":{"x":117,"y":506,"width":739,"height":12}},{"id":"99094aaa-de7c-44ff-b11a-982c8e4ed120","block_type":"box","text":"which BlackRock has significant debt or equity investments or other interests. The Fund may also","page_number":37,"box":{"x":116,"y":521,"width":729,"height":12}},{"id":"0fbe81d4-1613-40ad-8fac-8514a53886dc","block_type":"box","text":"invest in issuances (such as structured notes) by entities for which BlackRock provides and is","page_number":37,"box":{"x":117,"y":537,"width":699,"height":12}},{"id":"7f38aec3-5fa4-4864-a7cc-9d853ca623cf","block_type":"box","text":"compensated for cash management services relating to the proceeds from the sale of such issuances.","page_number":37,"box":{"x":116,"y":552,"width":765,"height":12}},{"id":"4c694a2a-e8c8-49e9-80a4-7af89a6d7ddd","block_type":"box","text":"In making investment decisions for the Fund, BlackRock is not permitted to obtain or use material","page_number":37,"box":{"x":117,"y":568,"width":727,"height":12}},{"id":"4df6f140-0a0b-4b4c-945f-f39a22e474b5","block_type":"box","text":"non-public information acquired by any unit of BlackRock, in the course of these activities. In addition,","page_number":37,"box":{"x":117,"y":583,"width":758,"height":12}},{"id":"e7947e62-67c1-429d-a9f3-f7acf1ddb42c","block_type":"box","text":"from time to time, the activities of BlackRock may limit the Fund’s flexibility in purchases and sales of","page_number":37,"box":{"x":116,"y":599,"width":753,"height":12}},{"id":"fc09ac6d-e52b-4b71-a273-6283910d9353","block_type":"box","text":"securities. As indicated below, BlackRock may engage in transactions with companies in which","page_number":37,"box":{"x":116,"y":614,"width":710,"height":12}},{"id":"1f5b822c-dbfa-4dd3-8c53-fe1bda58c1a8","block_type":"box","text":"BlackRock-advised funds or other clients of BlackRock have an investment.","page_number":37,"box":{"x":117,"y":630,"width":566,"height":9}},{"id":"428b04e1-ec95-40d4-86d2-0e43bde8bb2d","block_type":"box","text":"BlackRock and its personnel and other financial service providers may have interests in promoting","page_number":37,"box":{"x":117,"y":661,"width":727,"height":12}},{"id":"bbd1f790-e008-4b64-b3a5-6a7e529e2766","block_type":"box","text":"sales of the Fund. With respect to BlackRock and its personnel, the remuneration and profitability","page_number":37,"box":{"x":116,"y":676,"width":722,"height":12}},{"id":"cdb8ef34-8b6b-4b3f-80ec-f4d8ed345d9c","block_type":"box","text":"relating to services to and sales of the Fund or other products may be greater than remuneration and","page_number":37,"box":{"x":117,"y":692,"width":747,"height":12}},{"id":"6e5d20e1-b157-4f0d-8acd-32477be33390","block_type":"box","text":"profitability relating to services to and sales of certain funds or other products that might be provided or","page_number":37,"box":{"x":117,"y":707,"width":763,"height":12}},{"id":"7698d668-2db4-4e39-af60-1e0e2d3d8b70","block_type":"box","text":"offered. BlackRock and its sales personnel may directly or indirectly receive a portion of the fees and","page_number":37,"box":{"x":116,"y":723,"width":747,"height":12}},{"id":"e82cc35f-f1d3-400e-9b97-efdb5892b398","block_type":"box","text":"commissions charged to the Fund or its shareholders. BlackRock and its advisory or other personnel","page_number":37,"box":{"x":116,"y":738,"width":746,"height":12}},{"id":"eefb01de-b05e-4224-bc55-34ed4bc9a846","block_type":"box","text":"may also benefit from increased amounts of assets under management. Fees and commissions may","page_number":37,"box":{"x":117,"y":754,"width":747,"height":12}},{"id":"b505ec11-2643-4a13-a599-a4de4edfd690","block_type":"box","text":"also be higher than for other products or services, and the remuneration and profitability to BlackRock","page_number":37,"box":{"x":116,"y":769,"width":756,"height":12}},{"id":"a6e3ddff-2eea-4cbb-b2ec-1e466f897058","block_type":"box","text":"and such personnel resulting from transactions on behalf of or management of the Fund may be","page_number":37,"box":{"x":116,"y":785,"width":713,"height":12}},{"id":"43865e93-cfdf-44bd-bec6-adb9ae4c7d25","block_type":"box","text":"greater than the remuneration and profitability resulting from other funds or products.","page_number":37,"box":{"x":116,"y":800,"width":628,"height":12}},{"id":"e4196f1e-5c6a-456a-8d95-f0a778cfd0d4","block_type":"box","text":"BlackRock may provide valuation assistance to certain clients with respect to certain securities or other","page_number":37,"box":{"x":117,"y":831,"width":769,"height":12}},{"id":"4b71e481-9321-465f-a5bc-071b2afe1c33","block_type":"box","text":"investments and the valuation recommendations made for such clients’ accounts may differ from the","page_number":37,"box":{"x":117,"y":847,"width":749,"height":12}},{"id":"02d3f532-2226-4be6-8863-68a8403a40e9","block_type":"box","text":"valuations for the same securities or investments assigned by the Fund’s pricing vendors, especially if","page_number":37,"box":{"x":116,"y":862,"width":761,"height":12}},{"id":"1622eb86-1fad-45fe-9c0e-ce1cfd3ba003","block_type":"box","text":"such valuations are based on broker-dealer quotes or other data sources unavailable to the Fund’s","page_number":37,"box":{"x":116,"y":878,"width":739,"height":12}},{"id":"8a979b9f-f46b-467d-83d4-1e066fa29f67","block_type":"box","text":"32","page_number":37,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"bd1784a9-db59-4644-9bf9-5d962e09fc64","block_type":"box","text":"NM0926U-5926888-37/257","page_number":37,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"7c969575-7ec0-4e2c-a3a5-7c069860528c","block_type":"box","text":"pricing vendors. While BlackRock will generally communicate its valuation information or","page_number":38,"box":{"x":117,"y":87,"width":660,"height":12}},{"id":"e3e8c48b-aa77-47bf-b44e-8edc961aa7ec","block_type":"box","text":"determinations to the Fund’s pricing vendors and/or fund accountants, there may be instances where","page_number":38,"box":{"x":116,"y":102,"width":755,"height":13}},{"id":"aecda370-6f0c-4c44-9ca3-2ec27f571968","block_type":"box","text":"the Fund’s pricing vendors or fund accountants assign a different valuation to a security or other","page_number":38,"box":{"x":116,"y":118,"width":717,"height":12}},{"id":"dbbd58b0-b58c-4fd4-9a85-3df1a736cd56","block_type":"box","text":"investment than the valuation for such security or investment determined or recommended by","page_number":38,"box":{"x":117,"y":134,"width":699,"height":12}},{"id":"4ac19cb1-542a-4845-8dd3-358227190183","block_type":"box","text":"BlackRock.","page_number":38,"box":{"x":117,"y":149,"width":88,"height":10}},{"id":"31823aec-9182-408d-94ad-de5cdca95416","block_type":"box","text":"As disclosed in more detail in the Determination of Net Asset Value section in this SAI, when market","page_number":38,"box":{"x":116,"y":180,"width":748,"height":11}},{"id":"682b6d3d-777c-4d9d-8360-823605754473","block_type":"box","text":"quotations are not readily available or are believed by BFA to be unreliable, the Fund’s investments are","page_number":38,"box":{"x":116,"y":196,"width":771,"height":12}},{"id":"f1b5bac2-1f56-4170-8e9d-23e026fd8d53","block_type":"box","text":"valued at fair value by BFA. BFA has been designated as the Fund’s valuation designee pursuant to","page_number":38,"box":{"x":116,"y":211,"width":748,"height":12}},{"id":"2d80dc60-a91c-46ba-8653-a6b22176bdee","block_type":"box","text":"Rule 2a-5 under the Investment Company Act and acts through BFA’s Rule 2a-5 Committee (the “2a-5","page_number":38,"box":{"x":117,"y":227,"width":766,"height":12}},{"id":"3084c86e-6b4f-45e3-ba7c-99e0e2fa1fad","block_type":"box","text":"Committee”), with assistance from other BFA pricing committees and in accordance with BFA’s policies","page_number":38,"box":{"x":117,"y":242,"width":771,"height":12}},{"id":"0d21355b-294b-4e25-90a0-da22990131d7","block_type":"box","text":"and procedures (the “Valuation Procedures”). When determining a “fair value price,” the 2a-5","page_number":38,"box":{"x":116,"y":258,"width":694,"height":12}},{"id":"1a1e8d22-f122-4a46-a185-eb5f85e66e81","block_type":"box","text":"Committee seeks to determine the price that the Fund might reasonably expect to receive from the","page_number":38,"box":{"x":117,"y":273,"width":736,"height":12}},{"id":"630633fa-96b3-4b26-8d1b-92349caac964","block_type":"box","text":"current sale of that asset or liability in an arm’s-length transaction. The price generally may not be","page_number":38,"box":{"x":116,"y":289,"width":730,"height":12}},{"id":"1bd2625c-95af-4146-af40-24534af0b276","block_type":"box","text":"determined based on what the Fund might reasonably expect to receive for selling an asset or liability","page_number":38,"box":{"x":116,"y":304,"width":759,"height":12}},{"id":"85a7a0fe-b5bb-4bd6-aea0-eb48c6e67591","block_type":"box","text":"at a later time or if it holds the asset or liability to maturity. While fair value determinations will be based","page_number":38,"box":{"x":116,"y":320,"width":770,"height":12}},{"id":"29232e4e-1008-40c5-b4f9-8938e1c1de4b","block_type":"box","text":"upon all available factors that BFA deems relevant at the time of the determination, and may be based","page_number":38,"box":{"x":117,"y":335,"width":763,"height":12}},{"id":"3d9ce130-f31c-48b7-a5fa-c0b52e689f1d","block_type":"box","text":"on analytical values determined by BFA using proprietary or third party valuation models, fair value","page_number":38,"box":{"x":116,"y":351,"width":738,"height":12}},{"id":"47eafc71-6fb9-4760-a5ab-ab98074f7dfc","block_type":"box","text":"represents only a good faith approximation of the value of an asset or liability. The fair value of one or","page_number":38,"box":{"x":117,"y":366,"width":758,"height":12}},{"id":"3a4dc039-6368-447b-977b-2ab953bc1b59","block_type":"box","text":"more assets or liabilities may not, in retrospect, be the price at which those assets or liabilities could","page_number":38,"box":{"x":117,"y":382,"width":745,"height":12}},{"id":"2acac7fc-89c3-4cf7-88fd-c05118a104aa","block_type":"box","text":"have been sold during the period in which the particular fair values were used in determining the","page_number":38,"box":{"x":117,"y":397,"width":718,"height":12}},{"id":"a9734597-a6f5-4445-900b-b8443a6e3797","block_type":"box","text":"Fund’s NAV. As a result, the Fund’s sale or redemption of its shares at NAV, at a time when a holding","page_number":38,"box":{"x":117,"y":413,"width":760,"height":12}},{"id":"846af3a3-6b74-4680-af7e-bf02790f7f4c","block_type":"box","text":"or holdings are valued by the 2a-5 Committee at fair value, may have the effect of diluting or increasing","page_number":38,"box":{"x":116,"y":428,"width":771,"height":12}},{"id":"e2e84e30-6b1e-4967-a36d-db1546970eb1","block_type":"box","text":"the economic interest of existing shareholders and may affect the amount of revenue received by BFA","page_number":38,"box":{"x":116,"y":444,"width":763,"height":12}},{"id":"f20aabf0-6e32-410b-8607-f088653b31e7","block_type":"box","text":"with respect to services for which it receives an asset-based fee.","page_number":38,"box":{"x":116,"y":459,"width":484,"height":12}},{"id":"0876610d-57ea-48cd-8f3b-63ab87a5370a","block_type":"box","text":"To the extent permitted by applicable law, the Fund may invest all or some of its short term cash","page_number":38,"box":{"x":116,"y":490,"width":720,"height":12}},{"id":"54f697b0-e02a-4a6d-b892-b7e14d9d902f","block_type":"box","text":"investments in any money market fund or similarly-managed private fund advised or managed by","page_number":38,"box":{"x":117,"y":506,"width":725,"height":12}},{"id":"1a07d084-feb3-457c-9f23-6c253b9e59a0","block_type":"box","text":"BlackRock. In connection with any such investments, the Fund, to the extent permitted by the","page_number":38,"box":{"x":117,"y":521,"width":697,"height":12}},{"id":"d51a0d0b-a123-4533-b663-ba623ace92c1","block_type":"box","text":"Investment Company Act, may pay its share of expenses of a money market fund or other similarly","page_number":38,"box":{"x":117,"y":537,"width":739,"height":12}},{"id":"913a593f-5970-4956-a202-d3191685c346","block_type":"box","text":"managed private fund in which it invests, which may result in the Fund bearing some additional","page_number":38,"box":{"x":117,"y":552,"width":709,"height":12}},{"id":"6e8a2930-5cbf-4748-8aae-3094474af7fc","block_type":"box","text":"expenses.","page_number":38,"box":{"x":116,"y":570,"width":81,"height":10}},{"id":"aed5d62d-6946-4a4d-8c5b-37fcee5db69f","block_type":"box","text":"BlackRock and its directors, officers and employees, may buy and sell securities or other investments","page_number":38,"box":{"x":117,"y":599,"width":758,"height":12}},{"id":"abf167ff-27b3-4c6c-87b2-a43ffdbb4f26","block_type":"box","text":"for their own accounts and may have conflicts of interest with respect to investments made on behalf of","page_number":38,"box":{"x":116,"y":614,"width":771,"height":12}},{"id":"b426a1a6-9adc-4e97-b848-82e499beb3b7","block_type":"box","text":"the Fund. As a result of differing trading and investment strategies or constraints, positions may be","page_number":38,"box":{"x":116,"y":630,"width":737,"height":12}},{"id":"c2729781-834a-49a0-90ed-0ccc9eebf235","block_type":"box","text":"taken by directors, officers and employees of BlackRock that are the same, different from or made at","page_number":38,"box":{"x":116,"y":645,"width":752,"height":12}},{"id":"82a34f3c-8b39-4009-ad58-222cb0373709","block_type":"box","text":"different times than positions taken for the Fund. To lessen the possibility that the Fund will be","page_number":38,"box":{"x":116,"y":661,"width":698,"height":12}},{"id":"d0733d49-bce0-417a-83c5-b62ebda8d288","block_type":"box","text":"adversely affected by this personal trading, the Fund, BFA and BlackRock each have adopted a Code","page_number":38,"box":{"x":116,"y":676,"width":756,"height":12}},{"id":"25d58ee1-2863-4ca9-a86b-b477178471d2","block_type":"box","text":"of Ethics in compliance with Section 17(j) of the Investment Company Act that restricts securities","page_number":38,"box":{"x":116,"y":692,"width":717,"height":12}},{"id":"a26e6f5b-0baf-4f1a-98de-63b9344a9bf7","block_type":"box","text":"trading in the personal accounts of investment professionals and others who normally come into","page_number":38,"box":{"x":116,"y":707,"width":712,"height":12}},{"id":"eaa093f7-efda-4a4a-87ad-d335ca40dcb6","block_type":"box","text":"possession of information regarding the Fund’s portfolio transactions. Each Code of Ethics is also","page_number":38,"box":{"x":117,"y":723,"width":722,"height":12}},{"id":"76988c44-cb76-4132-a0c4-635e39e42a9f","block_type":"box","text":"available on the EDGAR Database on the SEC’s Internet site at http://www.sec.gov, and copies may","page_number":38,"box":{"x":116,"y":738,"width":746,"height":12}},{"id":"8a1b7b14-2a42-43aa-b064-2061acb1d12a","block_type":"box","text":"be obtained, after paying a duplicating fee, by e-mail at publicinfo@sec.gov.","page_number":38,"box":{"x":117,"y":754,"width":562,"height":12}},{"id":"b8c26973-b808-43af-b1fe-fff0911af8f8","block_type":"box","text":"BlackRock will not purchase securities or other property from, or sell securities or other property to, the","page_number":38,"box":{"x":117,"y":785,"width":762,"height":12}},{"id":"8ed2d20e-ee2b-486c-9905-534f18b5adfe","block_type":"box","text":"Fund, except that the Fund may in accordance with rules or guidance adopted under the Investment","page_number":38,"box":{"x":117,"y":800,"width":742,"height":12}},{"id":"31550bb1-00a3-4321-bb70-3c7cd9a58eb4","block_type":"box","text":"Company Act engage in transactions with another fund or accounts that are affiliated with the Fund as","page_number":38,"box":{"x":117,"y":816,"width":756,"height":12}},{"id":"98b907a7-c111-4df3-bc27-c6a7f98b36fb","block_type":"box","text":"a result of common officers, directors, or investment advisers or pursuant to exemptive orders granted","page_number":38,"box":{"x":116,"y":831,"width":763,"height":12}},{"id":"6997b329-6649-4908-9831-413fabe4ac61","block_type":"box","text":"to the Fund and/or BlackRock by the SEC. These transactions would be effected in circumstances in","page_number":38,"box":{"x":116,"y":847,"width":752,"height":12}},{"id":"cc7b3bda-2040-4d1c-a6b4-fe2ba948dc85","block_type":"box","text":"which BlackRock determined that it would be appropriate for the Fund to purchase and another client","page_number":38,"box":{"x":116,"y":862,"width":755,"height":12}},{"id":"05674a2d-863d-468b-8b93-0410fbd6e6b9","block_type":"box","text":"of BlackRock to sell, or the Fund to sell and another client of BlackRock to purchase, the same security","page_number":38,"box":{"x":116,"y":878,"width":771,"height":12}},{"id":"6a555088-1904-400f-9b61-6b328e3bc53e","block_type":"box","text":"33","page_number":38,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"8cc95add-0a20-419c-9e05-d72db4dc65ae","block_type":"box","text":"NM0926U-5926888-38/257","page_number":38,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"1dcf1b2d-139d-48fe-b001-2ac849ab5402","block_type":"box","text":"or instrument on the same day. From time to time, the activities of the Fund may be restricted because","page_number":39,"box":{"x":116,"y":87,"width":767,"height":12}},{"id":"d8762416-d08c-43bc-a75e-7d8ff93bbfbf","block_type":"box","text":"of regulatory requirements applicable to BlackRock and/or BlackRock’s internal policies designed to","page_number":39,"box":{"x":116,"y":102,"width":745,"height":13}},{"id":"7251305c-a7e9-4f9c-8eb7-61d8ba986aba","block_type":"box","text":"comply with, limit the applicability of, or otherwise relate to such requirements. A client not advised by","page_number":39,"box":{"x":116,"y":118,"width":758,"height":12}},{"id":"093eac4a-bdf5-46d4-aa67-f94a4575211e","block_type":"box","text":"BlackRock would not be subject to some of those considerations. There may be periods when","page_number":39,"box":{"x":117,"y":134,"width":701,"height":12}},{"id":"233141ad-da5c-4f2f-9ed4-2ae74b547341","block_type":"box","text":"BlackRock may not initiate or recommend certain types of transactions, or may otherwise restrict or","page_number":39,"box":{"x":117,"y":149,"width":741,"height":12}},{"id":"d05581c5-adad-4dd9-8f7f-8600ed982ef2","block_type":"box","text":"limit its advice in certain securities or instruments issued by or related to companies for which","page_number":39,"box":{"x":117,"y":165,"width":697,"height":12}},{"id":"798030bb-32ac-49ae-b8cd-8639efc7dc60","block_type":"box","text":"BlackRock is performing advisory or other services or has proprietary positions. For example, when","page_number":39,"box":{"x":117,"y":180,"width":742,"height":12}},{"id":"5acacd6e-1c6e-4b82-8c1d-62173a039f36","block_type":"box","text":"BlackRock is engaged to provide advisory or risk management services for a company, BlackRock","page_number":39,"box":{"x":117,"y":196,"width":736,"height":12}},{"id":"bd16dfc4-77a8-44f3-ae48-df9f418aa6bd","block_type":"box","text":"may be prohibited from or limited in purchasing or selling securities of that company on behalf of the","page_number":39,"box":{"x":117,"y":211,"width":746,"height":12}},{"id":"076fca28-47df-4175-abf8-3adf7847a340","block_type":"box","text":"Fund, particularly where such services result in BlackRock obtaining material non-public information","page_number":39,"box":{"x":117,"y":227,"width":745,"height":12}},{"id":"57afbf11-bd46-41ef-af0d-90b25e3248c0","block_type":"box","text":"about the company (e.g., in connection with participation in a creditors’ committee). Similar situations","page_number":39,"box":{"x":116,"y":242,"width":754,"height":12}},{"id":"5310b86c-9862-4f8f-b5e4-278d8a9d2288","block_type":"box","text":"could arise if personnel of BlackRock serve as directors of companies the securities of which the Fund","page_number":39,"box":{"x":116,"y":258,"width":764,"height":11}},{"id":"e17116a0-f76a-442b-9c81-8f998abf8e51","block_type":"box","text":"wishes to purchase or sell. However, if permitted by applicable law, and where consistent with","page_number":39,"box":{"x":116,"y":273,"width":702,"height":12}},{"id":"f44b58af-e71b-4abf-8cd7-7a8223b19be7","block_type":"box","text":"BlackRock’s policies and procedures (including the necessary implementation of appropriate","page_number":39,"box":{"x":117,"y":289,"width":691,"height":12}},{"id":"fcfb49ff-4dcf-4f71-9f8c-c0d8883a9161","block_type":"box","text":"information barriers), the Fund may purchase securities or instruments that are issued by such","page_number":39,"box":{"x":117,"y":304,"width":705,"height":12}},{"id":"e74c89fc-73b4-4097-bfab-d9caaaec88ee","block_type":"box","text":"companies, are the subject of an advisory or risk management assignment by BlackRock, or where","page_number":39,"box":{"x":116,"y":320,"width":741,"height":12}},{"id":"3b474426-53bc-4727-9887-c844101ad230","block_type":"box","text":"personnel of BlackRock are directors or officers of the issuer.","page_number":39,"box":{"x":117,"y":335,"width":458,"height":12}},{"id":"491c5a19-3963-4dce-a4c7-93769ad81817","block_type":"box","text":"BlackRock has adopted and implemented policies and procedures that are designed to address","page_number":39,"box":{"x":117,"y":366,"width":714,"height":12}},{"id":"4a978ca3-29cb-48fb-a74a-56b9561450f2","block_type":"box","text":"potential conflicts that arise in connection with the advisory services BlackRock provides to the Fund","page_number":39,"box":{"x":117,"y":382,"width":749,"height":12}},{"id":"0f24fb30-b761-43f6-a502-83fb6089f119","block_type":"box","text":"and other clients. Certain BlackRock advisory personnel may take views, and make decisions or","page_number":39,"box":{"x":116,"y":397,"width":719,"height":12}},{"id":"0102ed7e-1c04-431b-80aa-3b97934f8d07","block_type":"box","text":"recommendations, that are different than or opposite those of other BlackRock advisory personnel.","page_number":39,"box":{"x":117,"y":413,"width":737,"height":12}},{"id":"143139fd-d3e1-4429-b597-609d1a6364ef","block_type":"box","text":"Certain portfolio management teams within BlackRock may make decisions or take (or refrain from","page_number":39,"box":{"x":117,"y":428,"width":737,"height":12}},{"id":"051cdb4f-6656-4e83-adb6-b7fc9648ba9f","block_type":"box","text":"taking) actions with respect to clients they advise in a manner different than or adverse to the decisions","page_number":39,"box":{"x":116,"y":444,"width":771,"height":12}},{"id":"36317648-ac19-43f9-81fb-a6da1d54639b","block_type":"box","text":"made or the actions taken (or not taken) by the Fund’s portfolio management teams. The various","page_number":39,"box":{"x":117,"y":459,"width":723,"height":12}},{"id":"c66ddc92-173a-49c1-bd4f-5623a105cc31","block_type":"box","text":"portfolio management teams may not share information with each other, including as a result of certain","page_number":39,"box":{"x":117,"y":475,"width":767,"height":12}},{"id":"691f174d-3a5c-4783-beb0-c8a19faf308c","block_type":"box","text":"information barriers and other policies, and will not have any obligation or other duty to do so.","page_number":39,"box":{"x":117,"y":490,"width":697,"height":12}},{"id":"21feb202-6ca0-49dc-a2ab-e20791137041","block_type":"box","text":"BlackRock has established certain information barriers and other policies to address the sharing of","page_number":39,"box":{"x":117,"y":521,"width":736,"height":12}},{"id":"8b06ba00-070f-454c-ad86-6368b5a9f870","block_type":"box","text":"information between different businesses within BlackRock, including with respect to personnel","page_number":39,"box":{"x":117,"y":537,"width":709,"height":12}},{"id":"fe0533c6-4cb9-469c-b2f1-aa1360dbaf22","block_type":"box","text":"responsible with managing portfolios and voting proxies with respect to certain index equity portfolios","page_number":39,"box":{"x":117,"y":552,"width":753,"height":12}},{"id":"eb2226c1-d373-4dae-bdd3-108914e3df0f","block_type":"box","text":"versus those responsible for managing portfolios and voting proxies with respect to all other portfolios.","page_number":39,"box":{"x":116,"y":568,"width":763,"height":12}},{"id":"55d69a0c-f922-4365-ace6-14b6aca718cb","block_type":"box","text":"As a result of information barriers, certain units of BlackRock generally will not have access, or will","page_number":39,"box":{"x":116,"y":583,"width":735,"height":12}},{"id":"55ebc352-a880-4996-81e5-ca5cf059c6cb","block_type":"box","text":"have limited access, to certain information and personnel, including senior personnel, in other units of","page_number":39,"box":{"x":117,"y":599,"width":757,"height":12}},{"id":"69878369-ebf1-4b00-aa84-ca8c944ade08","block_type":"box","text":"BlackRock, and generally will not manage the funds with the benefit of information possessed by such","page_number":39,"box":{"x":117,"y":614,"width":761,"height":12}},{"id":"721d67d8-f7e7-4466-b36d-045101bee4f2","block_type":"box","text":"other units. Therefore, BlackRock may not be able to review potential investments for the Fund with the","page_number":39,"box":{"x":116,"y":630,"width":772,"height":12}},{"id":"7b46d4b6-058e-4732-a799-c6928c022e56","block_type":"box","text":"benefit of information held by certain areas of BlackRock.","page_number":39,"box":{"x":117,"y":645,"width":429,"height":12}},{"id":"1f358b9b-9229-4551-bf77-8f18579699af","block_type":"box","text":"BlackRock may determine to move certain personnel, businesses, or business units from one side of","page_number":39,"box":{"x":117,"y":676,"width":748,"height":12}},{"id":"8178a6a4-c59a-44a7-8238-31b1ba94166d","block_type":"box","text":"an information barrier to the other side of the information barrier. In connection therewith, BlackRock","page_number":39,"box":{"x":116,"y":692,"width":745,"height":11}},{"id":"8362cf0f-cdc8-4d6a-ba7a-5294dac9f8b0","block_type":"box","text":"personnel, businesses, and business units that were moved will no longer have access to the","page_number":39,"box":{"x":117,"y":707,"width":691,"height":12}},{"id":"0d7ce332-3259-40d4-8946-c502c15df072","block_type":"box","text":"information and personnel from the side of the information barrier from which they were moved.","page_number":39,"box":{"x":117,"y":723,"width":706,"height":12}},{"id":"4be4a1ad-2474-4047-ada2-65819c8460d5","block_type":"box","text":"Information obtained in connection with such changes to information barriers may limit or restrict the","page_number":39,"box":{"x":117,"y":738,"width":741,"height":12}},{"id":"33c113e8-07da-4a4c-bab9-72bfdf535a10","block_type":"box","text":"ability of BlackRock to engage in or otherwise effect transactions on behalf of the Fund (including","page_number":39,"box":{"x":116,"y":754,"width":720,"height":12}},{"id":"a67dc4f5-5261-4bd7-a8f5-f5cd135ac84c","block_type":"box","text":"purchasing or selling securities that BlackRock may otherwise have purchased or sold for a client in","page_number":39,"box":{"x":117,"y":769,"width":737,"height":12}},{"id":"9b664c02-5757-4209-b67f-a3682af0e138","block_type":"box","text":"the absence of a change to an information barrier). Information barriers may not have their intended","page_number":39,"box":{"x":116,"y":785,"width":740,"height":12}},{"id":"08ae02e1-8e4f-46df-a7cb-0019f38e9915","block_type":"box","text":"impact due to, for example, changes in applicable law or inadvertent crossings of the barriers, and","page_number":39,"box":{"x":117,"y":800,"width":726,"height":12}},{"id":"04c43447-88ec-474d-8972-123de12257f1","block_type":"box","text":"actions by personnel on one side of a barrier may impact the potential actions of personnel on the","page_number":39,"box":{"x":116,"y":816,"width":725,"height":12}},{"id":"782f561c-d195-457c-8c48-a91db869130c","block_type":"box","text":"other side of a barrier.","page_number":39,"box":{"x":116,"y":831,"width":169,"height":10}},{"id":"23580fa1-4eaa-482f-947d-fae8d332c957","block_type":"box","text":"Although the information barriers are intended to allow for independent portfolio management decision","page_number":39,"box":{"x":116,"y":862,"width":764,"height":12}},{"id":"cd721d8b-6ac1-4a47-ba33-3f57cb5f8812","block_type":"box","text":"making and proxy voting among certain BlackRock businesses, the investment activities of BlackRock","page_number":39,"box":{"x":117,"y":878,"width":761,"height":12}},{"id":"ed3abb06-7de2-4faf-8422-32802745968c","block_type":"box","text":"34","page_number":39,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"f6ccbe30-a85f-41c4-8b37-6f44f9acfba5","block_type":"box","text":"NM0926U-5926888-39/257","page_number":39,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"9b67bd10-e37b-44e1-b47c-0d317823168f","block_type":"box","text":"for BlackRock clients, as well as BlackRock’s proprietary accounts, may nonetheless limit the","page_number":40,"box":{"x":116,"y":87,"width":697,"height":12}},{"id":"a9e88f95-cfe7-4b3d-b24a-347fb1f638d9","block_type":"box","text":"investment strategies and rights of other clients (including the Fund). As BlackRock’s assets under","page_number":40,"box":{"x":117,"y":102,"width":735,"height":13}},{"id":"daa352a9-1556-4774-9f2f-343b4e0a86ce","block_type":"box","text":"management increases, BlackRock clients may face greater negative impacts due to ownership","page_number":40,"box":{"x":117,"y":118,"width":714,"height":12}},{"id":"9d0f5381-5b08-4832-8d68-de3d0f8a2b3b","block_type":"box","text":"restrictions and limitations imposed by laws, regulations, rules, regulators, or issuers. 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In light of certain restrictions, BlackRock may also seek to","page_number":40,"box":{"x":116,"y":289,"width":729,"height":12}},{"id":"f67ae45e-9e06-4669-b3d5-6f72fa09a80b","block_type":"box","text":"make indirect investments (e.g., using derivatives) on behalf of its clients to receive exposure to certain","page_number":40,"box":{"x":117,"y":304,"width":769,"height":12}},{"id":"fa5a9f90-8d6e-4f83-be19-5512005b97e8","block_type":"box","text":"securities in excess of the applicable ownership restrictions and limitations when legally permitted that","page_number":40,"box":{"x":116,"y":320,"width":762,"height":12}},{"id":"f4bfe1e0-6180-48a6-a300-f93b73506024","block_type":"box","text":"will expose such clients to additional costs and additional risks, including any risks associated with","page_number":40,"box":{"x":116,"y":335,"width":734,"height":12}},{"id":"397c2214-3e51-4416-b72a-4adcff34dd64","block_type":"box","text":"investing in derivatives. There may be limited availability of derivatives that provide indirect exposure to","page_number":40,"box":{"x":117,"y":351,"width":769,"height":12}},{"id":"3512c002-b4d9-4b29-a720-241b89dcb83b","block_type":"box","text":"an impacted security. BlackRock clients can be subject to more than one ownership limitation","page_number":40,"box":{"x":116,"y":366,"width":698,"height":12}},{"id":"ab594fdf-a224-4394-9098-cdea0c6efa8a","block_type":"box","text":"depending on each client’s holdings, and each ownership limitation can impact multiple securities held","page_number":40,"box":{"x":116,"y":382,"width":763,"height":12}},{"id":"ca9d53a1-c7b1-4513-b583-1c99ba2c4d9a","block_type":"box","text":"by the client. Certain clients or shareholders may have their own overlapping obligations to monitor","page_number":40,"box":{"x":117,"y":397,"width":738,"height":12}},{"id":"cdce9bdb-31bb-41a3-8822-4631ddb0320b","block_type":"box","text":"their compliance with ownership limitations across their investments.","page_number":40,"box":{"x":116,"y":413,"width":513,"height":12}},{"id":"134d2bb0-18aa-4f4b-9217-2debd5983c6f","block_type":"box","text":"If certain aggregate ownership thresholds are reached either through the actions of BlackRock or a","page_number":40,"box":{"x":117,"y":444,"width":738,"height":12}},{"id":"0140754f-278d-43ff-bfc1-290cc1b79b77","block_type":"box","text":"BlackRock client or as a result of corporate actions by the issuer, the ability of BlackRock on behalf of","page_number":40,"box":{"x":117,"y":459,"width":758,"height":12}},{"id":"113df20f-a157-4ae0-b529-963445603049","block_type":"box","text":"clients to purchase or dispose of investments, or exercise rights (including voting) or undertake","page_number":40,"box":{"x":116,"y":475,"width":709,"height":12}},{"id":"673ad624-909f-4651-aa14-f3faec13ec58","block_type":"box","text":"business transactions, may be restricted by law, regulation, rule, or organizational documents or","page_number":40,"box":{"x":117,"y":490,"width":717,"height":12}},{"id":"2dd5448e-60f6-42fc-b80b-e17714649bba","block_type":"box","text":"otherwise impaired. For example, to meet the requirements of an ownership limitation or restriction, a","page_number":40,"box":{"x":116,"y":506,"width":756,"height":12}},{"id":"e41c230a-aff0-4a3b-b72d-e3695fb631e2","block_type":"box","text":"client may be unable to purchase or directly hold a security the client would otherwise purchase or","page_number":40,"box":{"x":116,"y":521,"width":733,"height":12}},{"id":"411b24ac-4735-4a42-817f-b6342b68a7a0","block_type":"box","text":"hold. The limitation or restriction may be based on the holdings of other BlackRock clients instead of","page_number":40,"box":{"x":117,"y":537,"width":747,"height":12}},{"id":"37551c53-b543-48c7-9425-0eadccac18a7","block_type":"box","text":"the specific client being restricted. For index funds, this means a fund may not be able to track its index","page_number":40,"box":{"x":116,"y":552,"width":771,"height":12}},{"id":"8e90b8c0-7852-4964-a8bc-0ab754448bd3","block_type":"box","text":"as closely as it would if it was not subject to an ownership limitation or restriction because the fund","page_number":40,"box":{"x":116,"y":568,"width":735,"height":12}},{"id":"84967a97-901e-4c01-aa9b-9a8daaeacb8b","block_type":"box","text":"cannot acquire the amount of the impacted security included in its index. BlackRock on behalf of its","page_number":40,"box":{"x":116,"y":583,"width":741,"height":12}},{"id":"929350b4-5006-405d-9f05-6c22eb9fd357","block_type":"box","text":"clients may limit purchases, sell existing investments, utilize indirect investments, utilize information","page_number":40,"box":{"x":116,"y":599,"width":742,"height":12}},{"id":"3554a0ff-79c0-4b2f-83fa-eafd77d8d87c","block_type":"box","text":"barriers, or otherwise restrict, forgo, or limit the exercise of rights (including transferring, outsourcing, or","page_number":40,"box":{"x":117,"y":614,"width":771,"height":12}},{"id":"e100c5fb-6631-4579-baad-1087a37b4b17","block_type":"box","text":"limiting voting rights or forgoing the right to receive dividends) when BlackRock, in its sole discretion,","page_number":40,"box":{"x":117,"y":630,"width":751,"height":12}},{"id":"282f3cb2-ecc8-4ddb-81e2-7693890bfaa0","block_type":"box","text":"deems it appropriate in light of potential regulatory or other restrictions on ownership or other","page_number":40,"box":{"x":116,"y":645,"width":694,"height":12}},{"id":"6fde7f74-5785-4b0b-a738-3baf48f0d261","block_type":"box","text":"consequences resulting from reaching investment thresholds. These types of restrictions could","page_number":40,"box":{"x":116,"y":661,"width":702,"height":12}},{"id":"ecfd776b-e739-4cf0-b2fa-59dc2e4e76f9","block_type":"box","text":"negatively impact a client’s performance or ability to meet its investment objective.","page_number":40,"box":{"x":117,"y":676,"width":608,"height":12}},{"id":"59f66495-a747-43a4-9763-67e0cf4e5a94","block_type":"box","text":"When BlackRock or a BlackRock client is subject to an ownership limitation, BlackRock may in its","page_number":40,"box":{"x":116,"y":707,"width":723,"height":12}},{"id":"854fd779-c89c-4999-a43d-a80f93ef9511","block_type":"box","text":"discretion seek permission from the applicable issuers or regulators to exceed the limitation. However,","page_number":40,"box":{"x":116,"y":723,"width":758,"height":12}},{"id":"a8031fa3-e05d-4d1d-ad8b-d1f165d47ee3","block_type":"box","text":"there is no guarantee that permission will be granted, or that, once granted, it will not be modified or","page_number":40,"box":{"x":116,"y":738,"width":741,"height":12}},{"id":"61a2adc9-e094-4102-b9ac-5e9eed6f8ba4","block_type":"box","text":"revoked at a later date with minimal or no notice. The issuer and/or regulator may also require that","page_number":40,"box":{"x":117,"y":754,"width":729,"height":12}},{"id":"be0a2750-426c-49d0-bf6e-2b9784cd94ae","block_type":"box","text":"BlackRock on behalf of itself and its clients take or refrain from taking certain actions in connection with","page_number":40,"box":{"x":117,"y":769,"width":764,"height":12}},{"id":"f78ebc92-c5b6-449c-a05a-a8af7c7ccb4d","block_type":"box","text":"the approval, order, consent, relief or non-disapproval, which BlackRock may accept if it believes the","page_number":40,"box":{"x":116,"y":785,"width":747,"height":12}},{"id":"ff52ef4b-bb96-4915-9da9-21ccd19a95ec","block_type":"box","text":"benefits outweigh the costs and may limit BlackRock from taking actions that it otherwise would take.","page_number":40,"box":{"x":117,"y":800,"width":747,"height":12}},{"id":"f3feab4c-ca66-4a29-9750-61cb3509fd79","block_type":"box","text":"In those circumstances where ownership thresholds or limitations must be observed, BlackRock seeks","page_number":40,"box":{"x":117,"y":816,"width":760,"height":12}},{"id":"813c967d-9801-467b-81b1-2f272fa40d74","block_type":"box","text":"to allocate limited investment opportunities equitably among clients, taking into consideration","page_number":40,"box":{"x":116,"y":831,"width":693,"height":12}},{"id":"83f2557a-c919-4d94-9d19-3376b66e0665","block_type":"box","text":"benchmark weight and investment strategy. BlackRock may adopt certain controls designed to prevent","page_number":40,"box":{"x":117,"y":847,"width":767,"height":12}},{"id":"aa2ef04c-53a2-403a-a30f-6b09352dba62","block_type":"box","text":"the occurrence of a breach of any applicable ownership threshold or limits, including, for example,","page_number":40,"box":{"x":116,"y":862,"width":731,"height":12}},{"id":"74363fc7-751f-4c3f-89ca-92e5c58cc640","block_type":"box","text":"when ownership in certain securities nears an applicable threshold, BlackRock may limit additional","page_number":40,"box":{"x":116,"y":878,"width":736,"height":12}},{"id":"ff75c83a-883b-479a-992f-c73ec76fe00e","block_type":"box","text":"35","page_number":40,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"23dfccd3-05e8-4f29-9da7-78f44b6bfee2","block_type":"box","text":"NM0926U-5926888-40/257","page_number":40,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"61728568-7f75-438b-9281-1cf3820f66d4","block_type":"box","text":"purchases in such securities or remove such securities from the list of Deposit Securities to be","page_number":41,"box":{"x":117,"y":87,"width":704,"height":12}},{"id":"6fe7b072-a0dc-44ae-948f-665bdb873778","block_type":"box","text":"delivered to the Fund in connection with purchases of Creation Units of the Fund. If client holdings of","page_number":41,"box":{"x":116,"y":102,"width":752,"height":13}},{"id":"a8919270-1165-45c3-84ad-fa32c1362a7a","block_type":"box","text":"an issuer exceed an applicable threshold and BlackRock is unable to obtain relief to enable the","page_number":41,"box":{"x":116,"y":118,"width":710,"height":12}},{"id":"49d82923-76b3-4ca3-803b-b3bbfa7cfc7b","block_type":"box","text":"continued holding of such investments, it may be necessary to reduce these positions to meet the","page_number":41,"box":{"x":116,"y":134,"width":730,"height":12}},{"id":"44785484-4e22-409a-a614-ef2f02431799","block_type":"box","text":"applicable limitations and BlackRock or such client may be subject to regulatory actions. In these","page_number":41,"box":{"x":116,"y":149,"width":724,"height":12}},{"id":"0ed96340-67ee-4539-bcae-9fe377983397","block_type":"box","text":"cases, the investments will be sold in a manner that BlackRock deems fair and equitable over time.","page_number":41,"box":{"x":116,"y":165,"width":741,"height":11}},{"id":"75d930ba-dcd0-454b-85e2-85f898006a69","block_type":"box","text":"Ownership limitations are highly complex. It is possible that, despite BlackRock’s intent to either","page_number":41,"box":{"x":116,"y":193,"width":715,"height":12}},{"id":"1dd7c2d3-d56f-48ff-9975-865d1c5720bd","block_type":"box","text":"comply with or be granted permission to exceed ownership limitations, it may inadvertently breach a","page_number":41,"box":{"x":116,"y":209,"width":746,"height":12}},{"id":"2dce73e0-d2da-4e34-be83-e272f7ddea19","block_type":"box","text":"limit or violate the corporate or regulatory approval, order, consent, relief or non-disapproval that was","page_number":41,"box":{"x":117,"y":224,"width":753,"height":12}},{"id":"76bba6a4-7bb5-421f-b496-de7f48e71315","block_type":"box","text":"obtained.","page_number":41,"box":{"x":116,"y":240,"width":74,"height":9}},{"id":"5bcad19d-a9cd-4e23-a784-c3d08dcd6383","block_type":"box","text":"In addition to the foregoing, other ownership thresholds may trigger reporting requirements to","page_number":41,"box":{"x":117,"y":269,"width":696,"height":12}},{"id":"766c32ad-084d-4cbc-959b-90fa58d79a09","block_type":"box","text":"governmental and regulatory authorities, and such reports may entail the disclosure of the identity of a","page_number":41,"box":{"x":116,"y":284,"width":763,"height":12}},{"id":"8b4bdaac-9f67-4dee-8c0a-056d88433146","block_type":"box","text":"client or BlackRock’s intended strategy with respect to such security or asset.","page_number":41,"box":{"x":116,"y":300,"width":579,"height":12}},{"id":"00e8a0be-c9bc-474a-98e9-c91b1a4b71a5","block_type":"box","text":"BlackRock may not serve as an Authorized Participant in the creation and redemption of the Fund and","page_number":41,"box":{"x":117,"y":328,"width":763,"height":12}},{"id":"bad7d76c-ea1c-407e-aa71-5d1bc9d99b87","block_type":"box","text":"other BFA-advised ETFs.","page_number":41,"box":{"x":116,"y":344,"width":193,"height":9}},{"id":"a1527940-53b8-4d41-81fe-dc37173db92d","block_type":"box","text":"Under an ETF Services Agreement, to the extent applicable, the Fund has retained BRIL, an Affiliate of","page_number":41,"box":{"x":117,"y":373,"width":770,"height":12}},{"id":"5c397c54-420d-4131-8a6e-93f2d73d18c4","block_type":"box","text":"BFA, to perform certain order processing, Authorized Participant communications, and related services","page_number":41,"box":{"x":117,"y":388,"width":768,"height":12}},{"id":"f451e2e7-a090-4276-af1e-af2b361c28c9","block_type":"box","text":"in connection with the issuance and redemption of Creation Units (“ETF Services”). BRIL has engaged","page_number":41,"box":{"x":117,"y":404,"width":765,"height":12}},{"id":"2144ad76-fc61-4d55-a8fe-4d1aed1c418d","block_type":"box","text":"Citibank, N.A. (“Citibank”) as a subcontractor to provide certain ETF Services. BRIL retains a portion of","page_number":41,"box":{"x":117,"y":419,"width":768,"height":12}},{"id":"d2d1a7c4-ce31-4d92-b19c-67a492a162f1","block_type":"box","text":"the standard transaction fee received from Authorized Participants on each creation or redemption","page_number":41,"box":{"x":116,"y":435,"width":735,"height":12}},{"id":"b615c3af-6191-49cb-96e7-6383cf804cb6","block_type":"box","text":"order from the Authorized Participant for the ETF Services provided. BlackRock collaborated with, and","page_number":41,"box":{"x":116,"y":450,"width":764,"height":12}},{"id":"899d9049-40e8-4dee-b42c-86046fea1b49","block_type":"box","text":"received payment from, Citibank on the design and development of the ETF Services platform.","page_number":41,"box":{"x":117,"y":466,"width":707,"height":12}},{"id":"04dfa8b0-ed33-4c20-a225-4e0c3ca64b7c","block_type":"box","text":"Citibank has, and from time to time may develop, additional relationships with BlackRock or funds","page_number":41,"box":{"x":117,"y":481,"width":728,"height":12}},{"id":"09c325fe-08dc-4aca-8152-d60d3b6f4f6e","block_type":"box","text":"managed by BFA and its Affiliates.","page_number":41,"box":{"x":117,"y":497,"width":261,"height":12}},{"id":"cb44d039-b1e1-426e-822e-b71cc30bfa61","block_type":"box","text":"In order to defray transaction expenses and protect against possible shareholder dilution, the Fund","page_number":41,"box":{"x":117,"y":525,"width":737,"height":12}},{"id":"6ac0457b-f692-4c88-ab2c-f974d62adc17","block_type":"box","text":"may collect certain fees from Authorized Participants in connection with cash substitutions for creation","page_number":41,"box":{"x":117,"y":541,"width":761,"height":12}},{"id":"2577fe98-37e1-4b43-a6cf-58c8815b49ec","block_type":"box","text":"and redemption transactions. While BlackRock uses good faith estimates of the expected costs to the","page_number":41,"box":{"x":116,"y":556,"width":759,"height":12}},{"id":"81a46281-f263-4eb8-94b7-0a2d2989b0a2","block_type":"box","text":"Fund in determining the rates for fees collected by the Fund related to creation and redemption activity,","page_number":41,"box":{"x":117,"y":572,"width":770,"height":12}},{"id":"434ef29b-9a3a-492e-983a-d6f8e72823b3","block_type":"box","text":"BlackRock may have incentives to improve Fund performance through the collection of these fees. As","page_number":41,"box":{"x":117,"y":587,"width":760,"height":12}},{"id":"fe0fd8a5-e046-44de-83a6-ef3ea14fc285","block_type":"box","text":"these charges are based on estimates, where the charges exceed actual transaction costs incurred by","page_number":41,"box":{"x":116,"y":603,"width":765,"height":12}},{"id":"a7b0a150-93a4-4503-a925-781e04ac5929","block_type":"box","text":"the Fund, Fund performance could improve as a result. BlackRock has established processes to","page_number":41,"box":{"x":116,"y":618,"width":720,"height":12}},{"id":"a7d5be11-c66b-40be-96c8-cdb0745b1620","block_type":"box","text":"oversee the determination of these estimates in an effort to mitigate this conflict.","page_number":41,"box":{"x":116,"y":634,"width":600,"height":12}},{"id":"6ed61e08-a95f-4cab-a9ad-3f37785cc748","block_type":"box","text":"BlackRock may maintain securities indices. To the extent permitted by applicable laws, the Fund may","page_number":41,"box":{"x":117,"y":663,"width":752,"height":12}},{"id":"8371ccbf-9467-40d2-984f-f135f77c6101","block_type":"box","text":"seek to license and use such indices as part of its investment strategy. Index based funds that seek to","page_number":41,"box":{"x":116,"y":678,"width":758,"height":12}},{"id":"ff7ecc76-311d-4f76-af13-0260bc2fc3e4","block_type":"box","text":"track the performance of securities indices also may use the name of the index or index provider in the","page_number":41,"box":{"x":116,"y":694,"width":761,"height":12}},{"id":"c1539220-7325-4067-a2ad-0b3b47c9cb60","block_type":"box","text":"fund name. Index providers, including BlackRock (to the extent permitted by applicable law), may be","page_number":41,"box":{"x":116,"y":709,"width":744,"height":12}},{"id":"b96f8e78-7a0f-46f2-b1d6-7d19cc052a0c","block_type":"box","text":"paid licensing fees for use of their index or index name. In instances where BlackRock charges a","page_number":41,"box":{"x":117,"y":725,"width":717,"height":12}},{"id":"6768ef53-2764-49d3-94a0-21df4348996b","block_type":"box","text":"unitary management fee, BlackRock may have a financial incentive to use a BlackRock index that is","page_number":41,"box":{"x":117,"y":740,"width":741,"height":12}},{"id":"1f5bb668-aa1a-4cac-84bd-b84a28da244e","block_type":"box","text":"less costly to BlackRock than a third party index. BlackRock may benefit from the Fund using","page_number":41,"box":{"x":117,"y":756,"width":689,"height":12}},{"id":"b426e7c7-c053-41b0-91f3-fa70c175a085","block_type":"box","text":"BlackRock indices by creating increasing acceptance in the marketplace for such indices. BlackRock is","page_number":41,"box":{"x":117,"y":771,"width":763,"height":12}},{"id":"7d504f6a-ecaa-4da3-a1fb-f3e9c3372b4f","block_type":"box","text":"not obligated to license its indices to the Fund and the Fund is under no obligation to use BlackRock","page_number":41,"box":{"x":117,"y":787,"width":742,"height":12}},{"id":"1a062b3a-9b92-4631-ac6e-4235ecc1fe5e","block_type":"box","text":"indices. Any Fund that enters into a license for a BlackRock index cannot be assured that the terms of","page_number":41,"box":{"x":117,"y":802,"width":757,"height":12}},{"id":"f2372155-3f95-4d99-b448-f6366dfcc2fe","block_type":"box","text":"any index licensing agreement with BlackRock will be as favorable as those terms offered to other","page_number":41,"box":{"x":116,"y":818,"width":728,"height":12}},{"id":"16e7a137-237c-49ec-b660-bd485076cab5","block_type":"box","text":"licensees.","page_number":41,"box":{"x":117,"y":833,"width":78,"height":10}},{"id":"57fc0014-b463-4c1b-93c4-2547c73abf18","block_type":"box","text":"BlackRock may enter into contractual arrangements with third-party service providers to the Fund (e.g.,","page_number":41,"box":{"x":117,"y":862,"width":770,"height":12}},{"id":"415c0571-4a07-4faf-a0f3-247f5226830d","block_type":"box","text":"custodians, administrators and index providers) pursuant to which BlackRock receives fee discounts or","page_number":41,"box":{"x":116,"y":877,"width":769,"height":12}},{"id":"da37edd8-82b2-4297-8165-b9969df0b450","block_type":"box","text":"36","page_number":41,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"c6c84171-ae31-4db5-9fe5-e1975d95f875","block_type":"box","text":"NM0926U-5926888-41/257","page_number":41,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"052ad1e7-ce3f-4d44-87e8-c875b7f513a8","block_type":"box","text":"concessions in recognition of BlackRock’s overall relationship with such service providers. BlackRock","page_number":42,"box":{"x":116,"y":87,"width":757,"height":12}},{"id":"1d2124ba-aadb-404b-8c6d-cb4af6762021","block_type":"box","text":"may also enter into contractual arrangements with such service providers pursuant to which BlackRock","page_number":42,"box":{"x":117,"y":103,"width":769,"height":12}},{"id":"3e48fca7-3b75-4b15-94fa-dac26bd324de","block_type":"box","text":"incurs additional costs if the service provider’s services are terminated with respect to the Fund. To the","page_number":42,"box":{"x":117,"y":118,"width":767,"height":12}},{"id":"809ed55f-f0bc-4469-80a1-722a8b0ffba9","block_type":"box","text":"extent that BlackRock is responsible for paying service providers out of its fees that it receives from the","page_number":42,"box":{"x":116,"y":134,"width":770,"height":12}},{"id":"17f07bb0-c749-4f49-84a1-9ef5bf5c8a64","block_type":"box","text":"Fund, the benefits of lower fees, including any fee discounts or concessions, or any additional savings,","page_number":42,"box":{"x":117,"y":149,"width":766,"height":12}},{"id":"00d6f2e9-c6e5-44b9-908f-f3a6fffe8e31","block_type":"box","text":"may accrue, in whole or in part, to BlackRock, which could result in conflicts of interest relating to the","page_number":42,"box":{"x":117,"y":165,"width":752,"height":12}},{"id":"2d92e9b2-32c7-4fdd-b561-15baa2a4b014","block_type":"box","text":"use or termination of service providers to the Fund. In addition, conflicts of interest may arise with","page_number":42,"box":{"x":117,"y":180,"width":727,"height":12}},{"id":"5420abc5-3afa-4509-8a0d-b5fa8f837ca6","block_type":"box","text":"respect to contractual arrangements with third-party service providers to the Fund, or the selection of","page_number":42,"box":{"x":117,"y":196,"width":752,"height":12}},{"id":"385b4dca-1f74-45e8-a28e-4612459a7235","block_type":"box","text":"such providers, particularly in circumstances where BlackRock is negotiating on behalf of both funds","page_number":42,"box":{"x":116,"y":211,"width":749,"height":12}},{"id":"f5f1ab24-a6e0-4b77-90a6-c2bb49cd7339","block_type":"box","text":"that have a unitary management fee and those that do not or different service providers have different","page_number":42,"box":{"x":116,"y":227,"width":761,"height":12}},{"id":"dc6128d9-e697-44dc-be9e-a5392eb98fba","block_type":"box","text":"fee structures.","page_number":42,"box":{"x":116,"y":242,"width":111,"height":10}},{"id":"891abf22-72a0-458a-8c6c-4be393e63780","block_type":"box","text":"Conflicts of interest may arise as a result of simultaneous investment management of multiple client","page_number":42,"box":{"x":117,"y":273,"width":744,"height":12}},{"id":"e631ea90-1489-416d-b3b6-562b7c96eb8f","block_type":"box","text":"accounts by BlackRock’s investment professionals. For example, differences in the advisory fee","page_number":42,"box":{"x":116,"y":289,"width":716,"height":12}},{"id":"13edcf38-d750-444e-9dd6-ec917953097d","block_type":"box","text":"structure may create the appearance of actual or potential conflicts of interest because such","page_number":42,"box":{"x":116,"y":304,"width":689,"height":12}},{"id":"c3c28813-d93c-4a29-b6f3-340a091e40fd","block_type":"box","text":"differences could create pecuniary incentives for BlackRock to favor one client account over another.","page_number":42,"box":{"x":116,"y":320,"width":754,"height":12}},{"id":"c0b588db-54e5-4a87-a8ae-7624323314b7","block_type":"box","text":"BlackRock owns or has an ownership interest in certain trading, portfolio management, operations and/","page_number":42,"box":{"x":117,"y":351,"width":765,"height":12}},{"id":"0fcdb6b5-36b8-416b-b68e-336722473ec9","block_type":"box","text":"or information systems used by Fund service providers. These systems are, or will be, used by the","page_number":42,"box":{"x":116,"y":366,"width":736,"height":12}},{"id":"37b00393-7105-4fea-ae63-19c7e86efd0c","block_type":"box","text":"Fund service provider in connection with the provision of services to accounts managed by BlackRock","page_number":42,"box":{"x":117,"y":382,"width":761,"height":12}},{"id":"a9455f89-35c6-4bf3-b6de-75019e735540","block_type":"box","text":"and funds managed and sponsored by BlackRock, including the Fund, that engage the service","page_number":42,"box":{"x":116,"y":397,"width":707,"height":12}},{"id":"d5574a78-b06c-4815-8944-09ec37145329","block_type":"box","text":"provider (typically the custodian). The Fund’s service provider remunerates BlackRock for the use of","page_number":42,"box":{"x":117,"y":413,"width":748,"height":12}},{"id":"9d591048-e064-46d9-89ca-766b44d84265","block_type":"box","text":"the systems. The Fund service provider’s payments to BlackRock for the use of these systems may","page_number":42,"box":{"x":116,"y":428,"width":744,"height":12}},{"id":"615fbec0-8fe7-40d2-b999-722989488841","block_type":"box","text":"enhance the profitability of BlackRock.","page_number":42,"box":{"x":116,"y":444,"width":290,"height":12}},{"id":"8380b197-1f19-4466-b6f7-968cd11e82d7","block_type":"box","text":"BlackRock’s receipt of fees from a service provider in connection with the use of systems provided by","page_number":42,"box":{"x":117,"y":475,"width":757,"height":12}},{"id":"84e3a3a3-5d41-4dc3-a5b1-82e13b9e0226","block_type":"box","text":"BlackRock may create an incentive for BlackRock to recommend that the Fund enter into or renew an","page_number":42,"box":{"x":117,"y":490,"width":759,"height":12}},{"id":"6a1dbacb-b980-4459-b4aa-0c3572dd791a","block_type":"box","text":"arrangement with the service provider.","page_number":42,"box":{"x":116,"y":506,"width":291,"height":12}},{"id":"dbd9d119-0574-49c1-84c6-95c6e449d82d","block_type":"box","text":"In recognition of a BlackRock client’s overall relationship with BlackRock, BlackRock may offer special","page_number":42,"box":{"x":117,"y":537,"width":762,"height":12}},{"id":"28e4295f-1a2b-4bbf-b888-1b345bee5420","block_type":"box","text":"pricing arrangements for certain services provided by BlackRock. Any such special pricing","page_number":42,"box":{"x":117,"y":552,"width":673,"height":12}},{"id":"8e8728ae-2cec-4332-b4a4-486e8135b502","block_type":"box","text":"arrangements will not affect Fund fees and expenses applicable to such client’s investment in the","page_number":42,"box":{"x":116,"y":568,"width":727,"height":12}},{"id":"a3d4ef3b-baf0-4d58-a8c1-dc08256ef2f1","block_type":"box","text":"Fund.","page_number":42,"box":{"x":117,"y":583,"width":46,"height":10}},{"id":"1f7a854d-fbf5-4c55-8370-f817aaa34d32","block_type":"box","text":"Present and future activities of BlackRock and its directors, officers and employees, in addition to those","page_number":42,"box":{"x":117,"y":614,"width":771,"height":12}},{"id":"380979a7-4550-490a-8170-80123044c54f","block_type":"box","text":"described in this section, may give rise to additional conflicts of interest.","page_number":42,"box":{"x":116,"y":630,"width":537,"height":12}},{"id":"12906428-6884-482f-87ca-dc273cbba62b","block_type":"box","text":"Investment Advisory, Administrative and","page_number":42,"box":{"x":119,"y":681,"width":726,"height":29}},{"id":"31de4953-f3fc-4da8-9864-0734d87b82e0","block_type":"box","text":"Distribution Services","page_number":42,"box":{"x":119,"y":715,"width":376,"height":23}},{"id":"59826d35-9790-444c-be1b-cf3e217ebbbe","block_type":"box","text":"Investment Adviser.","page_number":42,"box":{"x":117,"y":767,"width":158,"height":9}},{"id":"32e5c82f-47b8-4279-b75b-8236cc60f218","block_type":"box","text":"BFA serves as investment adviser to the Fund pursuant to an investment","page_number":42,"box":{"x":282,"y":767,"width":541,"height":12}},{"id":"c4b63e88-6eea-4709-8b1d-fa5aa6555bf6","block_type":"box","text":"advisory agreement between the Trust, on behalf of the Fund, and BFA. BFA is a California","page_number":42,"box":{"x":116,"y":782,"width":678,"height":12}},{"id":"4de07b05-c97c-4736-9b91-a2b7c72b82ac","block_type":"box","text":"corporation indirectly owned by BlackRock, Inc. and is registered as an investment adviser under the","page_number":42,"box":{"x":116,"y":798,"width":748,"height":12}},{"id":"bd98d43d-4c2c-44d4-8de4-b079faa666d6","block_type":"box","text":"Investment Advisers Act of 1940, as amended. Under the investment advisory agreement, BFA,","page_number":42,"box":{"x":117,"y":813,"width":710,"height":12}},{"id":"96166d61-d30f-4871-85f1-54d57f15b9c7","block_type":"box","text":"subject to the supervision of the Board and in conformity with the stated investment policies of the","page_number":42,"box":{"x":116,"y":829,"width":731,"height":12}},{"id":"16af32f9-dd01-4f17-b7e1-83fe9a1bcd3f","block_type":"box","text":"Fund, manages and administers the Trust and the investment of the Fund’s assets. BFA is responsible","page_number":42,"box":{"x":117,"y":844,"width":767,"height":12}},{"id":"c07797a9-0c62-4ac6-8175-9f5f9ae39c66","block_type":"box","text":"for making investment decisions for the Fund.","page_number":42,"box":{"x":116,"y":860,"width":344,"height":12}},{"id":"b221af8a-2686-4a7f-af5e-fff7c84bef48","block_type":"box","text":"37","page_number":42,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"bbbefc84-f107-46cb-80d3-51daefa29b27","block_type":"box","text":"NM0926U-5926888-42/257","page_number":42,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"b32b79c9-7c2e-4bac-bc14-9f840d89e042","block_type":"box","text":"BFA is responsible, under the investment advisory agreement, for substantially all expenses of the","page_number":43,"box":{"x":117,"y":87,"width":734,"height":12}},{"id":"4ed595ef-13b5-4db7-a49b-9d81ac2a664b","block_type":"box","text":"Fund, including the cost of transfer agency, custody, fund administration, legal, audit and other","page_number":43,"box":{"x":117,"y":102,"width":706,"height":13}},{"id":"e568fb3d-cacd-41ed-95bb-259596ed01bf","block_type":"box","text":"services. BFA is not responsible for, and the Fund will bear the cost of, the management fees, interest","page_number":43,"box":{"x":116,"y":118,"width":762,"height":12}},{"id":"225255f1-ed02-4562-ae7e-f3fee6988b3f","block_type":"box","text":"expenses, taxes, expenses incurred with respect to the acquisition and disposition of portfolio","page_number":43,"box":{"x":116,"y":134,"width":699,"height":11}},{"id":"1cf7c457-772d-48b4-b46c-9135e64c8d97","block_type":"box","text":"securities and the execution of portfolio transactions, including brokerage commissions, distribution","page_number":43,"box":{"x":116,"y":149,"width":741,"height":12}},{"id":"0de0f6de-815a-492d-9a20-bbf231136d8a","block_type":"box","text":"fees or expenses, litigation expenses and extraordinary expenses (as determined by a majority of the","page_number":43,"box":{"x":116,"y":165,"width":757,"height":12}},{"id":"8d23fc42-ee34-4192-9fab-32713f36aa4a","block_type":"box","text":"Independent Trustees).","page_number":43,"box":{"x":117,"y":180,"width":177,"height":12}},{"id":"dea213e7-7391-4fe6-bf99-c9ddda736d70","block_type":"box","text":"Pursuant to the investment advisory agreement between BFA and the Trust entered into on behalf of","page_number":43,"box":{"x":117,"y":211,"width":752,"height":12}},{"id":"09ad0c03-c072-4a16-b7dd-5ee0614517dd","block_type":"box","text":"the Fund, BFA may from time to time, in its sole discretion, to the extent permitted by applicable law,","page_number":43,"box":{"x":116,"y":226,"width":750,"height":13}},{"id":"fdd0b0d3-91b1-4837-b640-05c55eab884d","block_type":"box","text":"appoint one or more sub-advisers, including, without limitation, affiliates of BFA, to perform investment","page_number":43,"box":{"x":116,"y":242,"width":764,"height":12}},{"id":"277fc56f-e82e-476a-91f9-e180e45f0995","block_type":"box","text":"advisory services with respect to the Fund. In addition, BFA may delegate certain of its investment","page_number":43,"box":{"x":116,"y":257,"width":734,"height":13}},{"id":"9604f3d3-1386-4a30-9826-4413bb49847f","block_type":"box","text":"advisory functions under the Investment Advisory Agreement to one or more of its affiliates to the","page_number":43,"box":{"x":116,"y":273,"width":726,"height":12}},{"id":"1acea80b-2218-4574-9046-ac575650c709","block_type":"box","text":"extent permitted by applicable law. BFA may terminate any or all sub-advisers or such delegation","page_number":43,"box":{"x":116,"y":289,"width":727,"height":12}},{"id":"d70e4189-130c-4b48-8757-b8d2d573b12a","block_type":"box","text":"arrangements in its sole discretion at any time to the extent permitted by applicable law.","page_number":43,"box":{"x":116,"y":304,"width":657,"height":12}},{"id":"f6ff2ab2-7ff3-4ea7-b2bf-b7fdf72a6c96","block_type":"box","text":"BFA has contractually agreed to waive a portion of its management fees in an amount equal to the","page_number":43,"box":{"x":117,"y":335,"width":722,"height":12}},{"id":"691f4ffe-bc6a-4314-9b2f-7f070d956382","block_type":"box","text":"aggregate Acquired Fund Fees and Expenses, if any, attributable to investments by a Fund in other","page_number":43,"box":{"x":116,"y":350,"width":731,"height":12}},{"id":"4e7279a9-057d-421a-9687-81b6fde18291","block_type":"box","text":"equity and fixed-income mutual funds and ETFs advised by BFA or its affiliates through June 30, 2028.","page_number":43,"box":{"x":116,"y":366,"width":755,"height":12}},{"id":"d3918b52-4ff8-44c6-a752-9a014d4bd160","block_type":"box","text":"BFA has also contractually agreed to waive a portion of its management fees by an amount equal to the","page_number":43,"box":{"x":117,"y":381,"width":762,"height":12}},{"id":"42e5c214-a303-482d-a848-4090f9b72012","block_type":"box","text":"aggregate Acquired Fund Fees and Expenses, if any, attributable to investments by the Fund in money","page_number":43,"box":{"x":116,"y":396,"width":757,"height":12}},{"id":"80c3c68c-2954-4cf1-b0a7-ba22cb7bf321","block_type":"box","text":"market funds advised by BFA or its affiliates through June 30, 2028. The agreement (with respect to","page_number":43,"box":{"x":117,"y":412,"width":733,"height":12}},{"id":"43e839ae-b2b3-446c-b47b-3b29802aef2f","block_type":"box","text":"either waiver) may be terminated upon 90 days’ notice by a majority of the non-interested trustees of the","page_number":43,"box":{"x":116,"y":427,"width":766,"height":12}},{"id":"3ed0d4e6-ea6b-4b3f-bb10-0b0d3590d359","block_type":"box","text":"Trust or by a vote of a majority of the outstanding voting securities of the Fund.","page_number":43,"box":{"x":116,"y":443,"width":578,"height":11}},{"id":"564ee06c-9581-469d-b735-6df4718264c4","block_type":"box","text":"BFA may also from time to time voluntarily waive and/or reimburse fees or expenses in order to limit","page_number":43,"box":{"x":117,"y":473,"width":734,"height":12}},{"id":"8ba3acc7-3b25-4266-9fe0-a9799e2e2e02","block_type":"box","text":"total annual fund operating expenses (excluding Acquired Fund Fees and Expenses, if any). Any such","page_number":43,"box":{"x":116,"y":489,"width":750,"height":12}},{"id":"c495c0e5-2310-4056-87ad-f25df793f67b","block_type":"box","text":"voluntary waiver or reimbursement may be eliminated by BFA at any time.","page_number":43,"box":{"x":116,"y":504,"width":544,"height":12}},{"id":"1d9f4a03-a702-4948-a8ea-1aed291c30f0","block_type":"box","text":"For the fiscal year ended April 30, 2026, BFA received a management fee, net of management fee","page_number":43,"box":{"x":117,"y":535,"width":722,"height":12}},{"id":"6a4a5a02-3a36-4186-82f8-d4b2f4ce999e","block_type":"box","text":"waivers, at the annual rate of 0.40% of the Fund’s average daily net assets.","page_number":43,"box":{"x":116,"y":550,"width":554,"height":12}},{"id":"aa44c2c3-57ee-4dc2-80fe-b46dacb6de23","block_type":"box","text":"The following table sets forth the management fee (net of any applicable waivers) the Fund paid BFA","page_number":43,"box":{"x":116,"y":581,"width":742,"height":12}},{"id":"8df37e2a-5a6f-4ecc-acd6-2799208ff476","block_type":"box","text":"and the amounts waived and/or reimbursed by BFA, for the fiscal period noted:","page_number":43,"box":{"x":116,"y":596,"width":579,"height":12}},{"id":"deda1304-19ad-42b8-a425-7fbdc4188442","block_type":"box","text":"Paid to BFA","page_number":43,"box":{"x":543,"y":624,"width":75,"height":8}},{"id":"895fe752-f8d3-4c3e-be42-a749e8bd31e0","block_type":"box","text":"1","page_number":43,"box":{"x":619,"y":624,"width":2,"height":5}},{"id":"e02d1567-ef6e-4036-9411-697e66f4b5e9","block_type":"box","text":"Waived by BFA","page_number":43,"box":{"x":640,"y":624,"width":98,"height":10}},{"id":"30b94466-32c1-4a96-b1ab-a6402f484ff2","block_type":"box","text":"Reimbursed by BFA","page_number":43,"box":{"x":756,"y":624,"width":127,"height":10}},{"id":"b376b1ce-d491-41c2-93bb-57353d558d40","block_type":"box","text":"Fiscal Period January 24, 2026 to April 30, 2026","page_number":43,"box":{"x":117,"y":643,"width":363,"height":12}},{"id":"4e95f4d8-1ca5-4431-94f3-e07781d869f0","block_type":"box","text":".....","page_number":43,"box":{"x":486,"y":651,"width":37,"height":1}},{"id":"b67d6984-468b-486b-9ca9-db3395860108","block_type":"box","text":"$498,591 $0 $0","page_number":43,"box":{"x":548,"y":642,"width":285,"height":12}},{"id":"88295f46-4ed7-4fe8-a576-7128f0ee649f","block_type":"box","text":"1","page_number":43,"box":{"x":144,"y":692,"width":2,"height":5}},{"id":"cfb1e7b0-e118-447a-98e8-aff3f6c01fe4","block_type":"box","text":"Effective January 23, 2026, the Predecessor Fund reorganized into the Fund.","page_number":43,"box":{"x":171,"y":692,"width":457,"height":10}},{"id":"63c8ff65-017e-4ae0-9625-3039dc2390c8","block_type":"box","text":"Effective January 23, 2026, the Predecessor Fund reorganized into the Fund. The following table sets","page_number":43,"box":{"x":117,"y":721,"width":754,"height":13}},{"id":"114d2501-3fc2-4ee0-99b1-68377e8e5194","block_type":"box","text":"forth the management fee (net of any applicable waivers) the Predecessor Fund paid BAL and the","page_number":43,"box":{"x":116,"y":737,"width":728,"height":12}},{"id":"2eee1720-812b-4543-9db7-371a81ac274b","block_type":"box","text":"amounts waived and/or reimbursed by BAL, for the fiscal periods noted:","page_number":43,"box":{"x":116,"y":752,"width":532,"height":13}},{"id":"880d7370-1562-479e-bce5-9a622ddebed2","block_type":"box","text":"Paid to BAL","page_number":43,"box":{"x":544,"y":780,"width":74,"height":8}},{"id":"b5fc7aef-f5d8-4185-b0a9-d87d07e6ffa3","block_type":"box","text":"Waived by BAL","page_number":43,"box":{"x":640,"y":780,"width":97,"height":10}},{"id":"4ff58aa6-c682-44d0-89ac-75fc7a497d9f","block_type":"box","text":"Reimbursed by BAL","page_number":43,"box":{"x":756,"y":780,"width":127,"height":10}},{"id":"4b8a0d70-7dd8-4b52-a217-10b4eaafec55","block_type":"box","text":"Fiscal Period May 1, 2025 to January 23, 2026","page_number":43,"box":{"x":117,"y":799,"width":346,"height":12}},{"id":"f55afc7d-34da-4284-aae0-6eb51c6f1e34","block_type":"box","text":"1","page_number":43,"box":{"x":465,"y":799,"width":3,"height":6}},{"id":"f3bfe171-0c09-4b46-be93-2a64e75eed5c","block_type":"box","text":".....","page_number":43,"box":{"x":483,"y":807,"width":37,"height":1}},{"id":"50d9b41e-5a60-4586-ac41-133a6c8ef577","block_type":"box","text":"$1,278,202 $139,684 $203,738","page_number":43,"box":{"x":539,"y":798,"width":314,"height":12}},{"id":"8c627f04-629b-4409-be4a-ad0cd5cf829f","block_type":"box","text":"Fiscal Year Ended April 30, 2025","page_number":43,"box":{"x":117,"y":814,"width":244,"height":12}},{"id":"eb4fee9d-f228-44ef-ab68-21a8a0be17e1","block_type":"box","text":".................","page_number":43,"box":{"x":376,"y":822,"width":144,"height":2}},{"id":"5fce1fb6-26b3-47cd-8340-8099d988f883","block_type":"box","text":"1,650,097 104,891 300,907","page_number":43,"box":{"x":550,"y":814,"width":303,"height":12}},{"id":"e6b98356-4667-414d-a653-23437948e39b","block_type":"box","text":"Fiscal Year Ended April 30, 2024","page_number":43,"box":{"x":117,"y":830,"width":249,"height":12}},{"id":"94852e1d-e839-4f4b-a78c-c95c47d041ef","block_type":"box","text":".................","page_number":43,"box":{"x":376,"y":838,"width":144,"height":1}},{"id":"e363af30-73bf-40dd-86b4-c24386cd4cdc","block_type":"box","text":"1,135,498 211,435 279,138","page_number":43,"box":{"x":550,"y":830,"width":309,"height":11}},{"id":"ce9e3fbd-e0c5-4470-a782-61c51e2d960e","block_type":"box","text":"1","page_number":43,"box":{"x":144,"y":880,"width":2,"height":4}},{"id":"75d738ca-6b49-4c38-aa17-d5dc7625766e","block_type":"box","text":"Effective January 23, 2026, the Predecessor Fund reorganized into the Fund.","page_number":43,"box":{"x":171,"y":879,"width":457,"height":10}},{"id":"95d1718f-a283-4a30-b559-b080f1d4c198","block_type":"box","text":"38","page_number":43,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"5f0b8371-568d-41c5-b098-2abde451edab","block_type":"box","text":"NM0926U-5926888-43/257","page_number":43,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"22202650-9c6d-4a39-be62-26b6dcc3dec4","block_type":"box","text":"The investment advisory agreement with respect to the Fund continues in effect for two years from its","page_number":44,"box":{"x":116,"y":87,"width":744,"height":12}},{"id":"dcfb2526-4a2a-403f-bb0a-350d4884b121","block_type":"box","text":"effective date, and thereafter is subject to annual approval by (i) the Board, or (ii) the vote of a majority","page_number":44,"box":{"x":116,"y":102,"width":752,"height":12}},{"id":"70029e30-943c-4007-940a-4e0b2c7fd2dd","block_type":"box","text":"of the outstanding voting securities (as defined in the Investment Company Act) of the Fund, provided","page_number":44,"box":{"x":116,"y":118,"width":746,"height":12}},{"id":"3dcd62d0-a94a-4a01-ac3a-b104d541e693","block_type":"box","text":"that in either event such continuance also is approved by a majority of the Board members who are not","page_number":44,"box":{"x":116,"y":133,"width":757,"height":12}},{"id":"277c4a9e-c7d2-4ad5-9d73-ac8dfc5e915d","block_type":"box","text":"interested persons (as defined in the Investment Company Act) of the Fund, by a vote cast in person at","page_number":44,"box":{"x":117,"y":148,"width":757,"height":12}},{"id":"30a7d501-4890-4b98-b8ac-b57ebe6eba1f","block_type":"box","text":"a meeting called for the purpose of voting on such approval.","page_number":44,"box":{"x":116,"y":164,"width":440,"height":12}},{"id":"38543330-c6c3-4899-a755-f1df67b7c59c","block_type":"box","text":"The investment advisory agreement with respect to the Fund is terminable without penalty, on 60 days’","page_number":44,"box":{"x":116,"y":195,"width":755,"height":12}},{"id":"78dececc-980c-4350-bd82-10279ceb0363","block_type":"box","text":"notice, by the Board or by a vote of the holders of a majority of the applicable Fund’s outstanding voting","page_number":44,"box":{"x":117,"y":210,"width":759,"height":12}},{"id":"dd5b65bb-4245-4ea6-a006-c3c42cc3dd7e","block_type":"box","text":"securities (as defined in the Investment Company Act). The investment advisory agreement is also","page_number":44,"box":{"x":116,"y":226,"width":724,"height":12}},{"id":"0ecd3333-4634-45cf-bbf6-cc686821a99b","block_type":"box","text":"terminable upon 60 days’ notice by BFA and will terminate automatically in the event of its assignment","page_number":44,"box":{"x":116,"y":241,"width":750,"height":12}},{"id":"4605e01c-7317-4dc1-958a-398347d097fe","block_type":"box","text":"(as defined in the Investment Company Act).","page_number":44,"box":{"x":117,"y":256,"width":326,"height":12}},{"id":"3f11ce8e-ebde-4a2e-b9d9-ff0364d614fd","block_type":"box","text":"Portfolio Managers.","page_number":44,"box":{"x":117,"y":287,"width":153,"height":12}},{"id":"86c2e86f-d03a-414d-af35-2e57669f20ee","block_type":"box","text":"As of April 30, 2026, the individuals named as Portfolio Managers in the Fund’s","page_number":44,"box":{"x":276,"y":287,"width":582,"height":12}},{"id":"7acac146-ee76-4f97-a372-9888a2e25b72","block_type":"box","text":"Prospectus were 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Although BFA and each of its affiliates have an obligation to allocate resources and","page_number":45,"box":{"x":117,"y":242,"width":711,"height":12}},{"id":"3b8256cf-69a0-49c9-b972-2a9d0d96ab85","block_type":"box","text":"opportunities equitably among portfolios and accounts and intend to do so, shareholders of the Fund","page_number":45,"box":{"x":116,"y":258,"width":751,"height":12}},{"id":"dd61e5d8-0202-4957-9fff-f7ff455721f8","block_type":"box","text":"should be aware that, as with any group of portfolios and accounts managed by an investment adviser","page_number":45,"box":{"x":116,"y":273,"width":764,"height":12}},{"id":"32c40ec5-bc1a-4488-919b-38ffaa0129b2","block_type":"box","text":"and/or its affiliates pursuant to varying fee arrangements, including performance-based fee","page_number":45,"box":{"x":116,"y":289,"width":679,"height":12}},{"id":"f5609aa0-e9a1-40f5-b051-c03b0072226c","block_type":"box","text":"arrangements, there is the potential for a conflict of interest, 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The principal components of compensation include a base salary, a performance","page_number":46,"box":{"x":117,"y":337,"width":746,"height":12}},{"id":"22975597-f064-4d3c-9f67-5ef7397ebd78","block_type":"box","text":"based discretionary bonus, participation in various benefits programs and one or more of the incentive","page_number":46,"box":{"x":117,"y":352,"width":762,"height":13}},{"id":"fc3dd6a5-d9a2-49a3-94e9-ab95b8643a7e","block_type":"box","text":"compensation programs established by BlackRock, Inc.","page_number":46,"box":{"x":116,"y":368,"width":418,"height":12}},{"id":"40133979-d4ce-472c-a87c-2ef99d340a10","block_type":"box","text":"Base compensation.","page_number":46,"box":{"x":117,"y":399,"width":167,"height":12}},{"id":"4a744771-eb9d-4842-be9b-a5f0f4b3f91a","block_type":"box","text":"Generally, portfolio managers receive base compensation based on their","page_number":46,"box":{"x":285,"y":399,"width":545,"height":12}},{"id":"0ccfcef0-1dcd-4caa-9d64-12a0b96e5f8d","block_type":"box","text":"position with the firm.","page_number":46,"box":{"x":117,"y":414,"width":161,"height":12}},{"id":"5fc7675d-6952-4318-8aeb-23cc34213514","block_type":"box","text":"Discretionary Incentive Compensation.","page_number":46,"box":{"x":117,"y":445,"width":315,"height":12}},{"id":"affa0e5c-5cd4-40b4-b50f-d3973061cd3a","block_type":"box","text":"Discretionary incentive compensation is a function of several","page_number":46,"box":{"x":433,"y":445,"width":454,"height":12}},{"id":"5a86d092-24bd-44c1-9f77-40bccdd9c45f","block_type":"box","text":"components: the performance of BlackRock, Inc., the performance of the portfolio manager’s group","page_number":46,"box":{"x":116,"y":461,"width":742,"height":12}},{"id":"45816402-7453-42ca-80f3-7eac154bf5e5","block_type":"box","text":"within BlackRock, the investment performance, including risk-adjusted returns, of the firm’s assets","page_number":46,"box":{"x":116,"y":476,"width":732,"height":12}},{"id":"bbda300d-68c2-4227-b94f-981cfa7e7a1a","block_type":"box","text":"under management or supervision by that portfolio manager relative to predetermined benchmarks,","page_number":46,"box":{"x":117,"y":492,"width":742,"height":12}},{"id":"42539ea5-6d88-40ab-8baf-dd8c4a9898f3","block_type":"box","text":"and the individual’s performance and contribution to the overall performance of these portfolios and","page_number":46,"box":{"x":116,"y":507,"width":742,"height":12}},{"id":"1cc1fcfa-8f29-49d4-aaf4-f287efa96f3d","block_type":"box","text":"BlackRock. In most cases, these benchmarks are the same as the benchmark or benchmarks against","page_number":46,"box":{"x":117,"y":523,"width":760,"height":12}},{"id":"df3faccb-e0e9-4fd7-8bc2-2ef311eb036d","block_type":"box","text":"which the performance of the funds or other accounts managed by the portfolio managers are","page_number":46,"box":{"x":116,"y":538,"width":701,"height":12}},{"id":"424921c4-2cda-484f-be1a-c8862b8c3b6b","block_type":"box","text":"measured. Among other things, BlackRock’s Chief Investment Officers make a subjective","page_number":46,"box":{"x":117,"y":554,"width":668,"height":12}},{"id":"8579ed2e-831d-403a-9db6-efe4f27dfe77","block_type":"box","text":"determination with respect to each portfolio manager’s compensation based on the performance of the","page_number":46,"box":{"x":116,"y":569,"width":766,"height":12}},{"id":"df663d72-13a2-4bd2-9932-b51c995400ac","block_type":"box","text":"funds and other accounts managed by each portfolio manager relative to the various benchmarks.","page_number":46,"box":{"x":116,"y":585,"width":733,"height":12}},{"id":"746c8e36-a542-4f17-b1ec-e4265fa3f066","block_type":"box","text":"Performance of fixed income funds is measured on a pre-tax and/or after-tax basis over various time","page_number":46,"box":{"x":117,"y":600,"width":750,"height":12}},{"id":"6d506771-88ee-43e0-9dc3-92fce139b4ad","block_type":"box","text":"periods including 1-, 3- and 5- year periods, as applicable. With respect to Samir Lakhani, Matthew","page_number":46,"box":{"x":117,"y":616,"width":738,"height":12}},{"id":"f794fcfe-a728-4a4c-9ad6-22ba365eebad","block_type":"box","text":"Kraeger and Siddharth Mehta, such benchmarks for the Fund and other accounts are a combination of","page_number":46,"box":{"x":117,"y":631,"width":766,"height":12}},{"id":"5a863711-c1ac-4e66-8a9d-3b0dc4986e64","block_type":"box","text":"market-based indices (e.g., FTSE Mortgage Index, Bloomberg GNMA MBS Index), certain customized","page_number":46,"box":{"x":117,"y":647,"width":764,"height":12}},{"id":"185c272b-7454-4af8-a0a7-df9571fcbc20","block_type":"box","text":"indices and certain fund industry peer groups.","page_number":46,"box":{"x":117,"y":662,"width":338,"height":12}},{"id":"890faede-065a-473b-b9d9-d5444e6de893","block_type":"box","text":"Distribution of Discretionary Incentive Compensation.","page_number":46,"box":{"x":117,"y":693,"width":424,"height":12}},{"id":"32e01eb4-0b8c-44e1-a1bc-461d36580739","block_type":"box","text":"Discretionary incentive compensation is","page_number":46,"box":{"x":548,"y":693,"width":291,"height":12}},{"id":"4d0c2dc2-9c09-4ac8-aab3-34b9816888e8","block_type":"box","text":"distributed to portfolio managers in a combination of cash, deferred BlackRock, Inc. stock awards, and/","page_number":46,"box":{"x":116,"y":708,"width":756,"height":12}},{"id":"014a3812-d419-423d-9974-1f851df84a53","block_type":"box","text":"or deferred cash awards that notionally track the return of certain BlackRock investment products.","page_number":46,"box":{"x":116,"y":724,"width":717,"height":12}},{"id":"2e298625-d540-447d-b436-f49f1b2eb391","block_type":"box","text":"Portfolio managers receive their annual discretionary incentive compensation in the form of cash.","page_number":46,"box":{"x":117,"y":754,"width":711,"height":12}},{"id":"d3c4cf35-7b27-4d30-9081-d6dd72ae5382","block_type":"box","text":"Portfolio managers whose total compensation is above a specified threshold also receive deferred","page_number":46,"box":{"x":117,"y":770,"width":719,"height":12}},{"id":"7577299e-0287-4a08-a1cb-7a2d4ab22e9a","block_type":"box","text":"BlackRock, Inc. stock awards annually as part of their discretionary incentive compensation. Paying a","page_number":46,"box":{"x":117,"y":785,"width":744,"height":12}},{"id":"f5a36a26-e818-43b8-85cf-a03de5866909","block_type":"box","text":"portion of discretionary incentive compensation in the form of deferred BlackRock, Inc. stock puts","page_number":46,"box":{"x":117,"y":800,"width":713,"height":12}},{"id":"ce548c4e-de77-41f0-9ae0-a1e4f0e6278b","block_type":"box","text":"compensation earned by a portfolio manager for a given year “at risk” based on BlackRock’s ability to","page_number":46,"box":{"x":116,"y":816,"width":744,"height":12}},{"id":"f35afc5d-159a-485f-b05a-a61d0f791657","block_type":"box","text":"sustain and improve its performance over future periods. In some cases, additional deferred BlackRock,","page_number":46,"box":{"x":116,"y":831,"width":762,"height":12}},{"id":"dd5a01a4-6276-4e29-9410-3dde57b4c516","block_type":"box","text":"Inc. stock may be granted to certain key employees as part of a long-term incentive award to aid in","page_number":46,"box":{"x":117,"y":847,"width":724,"height":12}},{"id":"710ac698-f630-4fb8-850e-8d478565f178","block_type":"box","text":"retention, align interests with long-term shareholders and motivate performance. Deferred BlackRock,","page_number":46,"box":{"x":117,"y":862,"width":744,"height":12}},{"id":"39745499-a696-4e57-8ce4-05adb4e7fd27","block_type":"box","text":"Inc. stock awards are generally granted in the form of BlackRock, Inc. restricted stock units that vest","page_number":46,"box":{"x":117,"y":877,"width":735,"height":12}},{"id":"bd679919-8ba9-4a31-9d80-c6ad70ada1b7","block_type":"box","text":"41","page_number":46,"box":{"x":490,"y":909,"width":16,"height":9}},{"id":"79a0ad71-17fe-4227-aed2-7dc3f7973a98","block_type":"box","text":"NM0926U-5926888-46/257","page_number":46,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"0736056d-9246-46d9-80c3-606b0509143b","block_type":"box","text":"pursuant to the terms of the applicable plan and, once vested, settle in BlackRock, Inc. common stock.","page_number":47,"box":{"x":117,"y":87,"width":751,"height":12}},{"id":"4e7a8f48-0506-42b0-bcc0-a8652848ca03","block_type":"box","text":"The portfolio managers of this Fund have deferred BlackRock, Inc. stock awards.","page_number":47,"box":{"x":116,"y":102,"width":594,"height":12}},{"id":"8db14d70-c27b-43c0-9479-62ca8c20d449","block_type":"box","text":"For certain portfolio managers, a portion of the discretionary incentive compensation is also distributed","page_number":47,"box":{"x":117,"y":133,"width":751,"height":12}},{"id":"df61e7ff-fcc3-4d98-85f0-eeee892cb51f","block_type":"box","text":"in the form of deferred cash awards that notionally track the returns of select BlackRock investment","page_number":47,"box":{"x":117,"y":149,"width":728,"height":12}},{"id":"2e5898f1-83aa-490a-97d5-dd7cc781f0df","block_type":"box","text":"products they manage, which provides direct alignment of portfolio manager discretionary incentive","page_number":47,"box":{"x":117,"y":164,"width":727,"height":12}},{"id":"08da0bc1-c6fb-42de-be46-807a889abc28","block_type":"box","text":"compensation with investment product results. Deferred cash awards vest ratably over a number of","page_number":47,"box":{"x":116,"y":179,"width":730,"height":12}},{"id":"8312ff00-82c1-43cd-accb-9d8eee86eb16","block_type":"box","text":"years and, once vested, settle in the form of cash. Only portfolio managers who manage specified","page_number":47,"box":{"x":116,"y":195,"width":718,"height":12}},{"id":"af80524c-f751-49f9-b8a5-32e13ca1a4fb","block_type":"box","text":"products and whose total compensation is above a specified threshold are eligible to participate in the","page_number":47,"box":{"x":117,"y":210,"width":746,"height":12}},{"id":"21c9451a-0b69-44c5-9d08-e1a2de670847","block_type":"box","text":"deferred cash award program.","page_number":47,"box":{"x":116,"y":225,"width":221,"height":12}},{"id":"628aa13f-fd37-4d42-9052-e0341f1c3eb8","block_type":"box","text":"Other Compensation Benefits.","page_number":47,"box":{"x":116,"y":256,"width":238,"height":12}},{"id":"8730105d-b728-4ce0-9fb3-7dfbf7838ee5","block_type":"box","text":"In addition to base salary and discretionary incentive compensation,","page_number":47,"box":{"x":362,"y":256,"width":497,"height":12}},{"id":"c2a2d73e-d941-4fa5-b097-031f0e961186","block_type":"box","text":"portfolio managers may be eligible to receive or participate in one or more of the following:","page_number":47,"box":{"x":117,"y":272,"width":661,"height":12}},{"id":"3b5c3d61-e683-4a89-9a90-dd1816415372","block_type":"box","text":"Incentive Savings Plans","page_number":47,"box":{"x":117,"y":295,"width":174,"height":12}},{"id":"222ea33f-ad7d-48ae-9f64-adbcee1cdcba","block_type":"box","text":"— BlackRock, Inc. has created a variety of incentive savings plans in which","page_number":47,"box":{"x":295,"y":295,"width":548,"height":12}},{"id":"2f8ea9b0-c885-482c-9fb5-f80c5e0d2d76","block_type":"box","text":"BlackRock, Inc. employees are eligible to participate, including a 401(k) plan, the BlackRock Retirement","page_number":47,"box":{"x":117,"y":310,"width":755,"height":12}},{"id":"cd655366-f055-4678-a0e8-8023fb223c69","block_type":"box","text":"Savings Plan (“RSP”), and the BlackRock Employee Stock Purchase Plan (“ESPP”). The employer","page_number":47,"box":{"x":116,"y":326,"width":719,"height":12}},{"id":"541920b7-ee50-4605-9ccb-c32c51352b61","block_type":"box","text":"contribution components of the RSP include a company match equal to 50% of the first 8% of eligible pay","page_number":47,"box":{"x":116,"y":341,"width":766,"height":12}},{"id":"2c5ea973-db39-435d-9477-cd38a987a161","block_type":"box","text":"contributed to the plan capped at $5,000 per year, and a company retirement contribution equal to 3-5%","page_number":47,"box":{"x":116,"y":356,"width":755,"height":12}},{"id":"afffb9d0-0c66-4d54-a38d-902e82e7efb2","block_type":"box","text":"of eligible compensation up to the Internal Revenue Service (the “IRS”) limit ($360,000 for 2026). The","page_number":47,"box":{"x":116,"y":371,"width":737,"height":13}},{"id":"31789a53-1c8f-4421-bdac-9dd3daee2ce4","block_type":"box","text":"RSP offers a range of investment options, including registered investment companies and collective","page_number":47,"box":{"x":117,"y":387,"width":724,"height":12}},{"id":"df3517fe-8a98-40f4-8960-d344ab80613c","block_type":"box","text":"investment funds managed by the firm. BlackRock, Inc. contributions follow the investment direction set","page_number":47,"box":{"x":117,"y":402,"width":751,"height":12}},{"id":"6376de83-ba31-4404-be57-573f079560e1","block_type":"box","text":"by participants for their own contributions or, absent participant investment direction, are invested into a","page_number":47,"box":{"x":117,"y":418,"width":751,"height":12}},{"id":"5eb7d907-fbe0-4493-a588-0bbc3d310fa0","block_type":"box","text":"target date fund that corresponds to, or is closest to, the year in which the participant attains age 65. The","page_number":47,"box":{"x":116,"y":433,"width":761,"height":12}},{"id":"e3b9221d-9849-4a51-9c15-8818bf8e948b","block_type":"box","text":"ESPP allows for investment in BlackRock, Inc. common stock at a 5% discount on the fair market value","page_number":47,"box":{"x":117,"y":449,"width":750,"height":11}},{"id":"37dbaa81-29d4-4f85-9047-101a9351e8f5","block_type":"box","text":"of the stock on the purchase date. Annual participation in the ESPP is limited to the purchase of 1,000","page_number":47,"box":{"x":116,"y":464,"width":741,"height":12}},{"id":"df093eed-0eb9-4f08-827e-53bdca746068","block_type":"box","text":"shares of common stock or a dollar value of $25,000 based on its fair market value on the purchase date.","page_number":47,"box":{"x":116,"y":479,"width":765,"height":12}},{"id":"215fbbc6-10f5-4112-ba11-683c917f8f3b","block_type":"box","text":"All of the eligible portfolio managers are eligible to participate in these plans.","page_number":47,"box":{"x":116,"y":495,"width":554,"height":12}},{"id":"5808e207-80cf-49eb-a015-a7de871fec0f","block_type":"box","text":"Portfolio Manager Beneficial Holdings","page_number":47,"box":{"x":116,"y":533,"width":285,"height":12}},{"id":"47044047-fd35-4421-965e-e2d638060a0a","block_type":"box","text":"The following table sets forth the dollar range of equity securities in the Fund beneficially owned by","page_number":47,"box":{"x":116,"y":572,"width":738,"height":12}},{"id":"63fc118c-2c76-4801-9428-462c56501f00","block_type":"box","text":"each portfolio manager as of April 30, 2026.","page_number":47,"box":{"x":116,"y":588,"width":331,"height":12}},{"id":"519012aa-21db-47ae-b5ec-80240bed348b","block_type":"box","text":"Portfolio Manager","page_number":47,"box":{"x":117,"y":626,"width":113,"height":9}},{"id":"c4068b59-06bf-4eb4-91d8-a00428273943","block_type":"box","text":"Dollar Range of Equity","page_number":47,"box":{"x":629,"y":615,"width":143,"height":10}},{"id":"eee5af6e-ac86-45db-91f8-89a47a935411","block_type":"box","text":"Securities Beneficially Owned","page_number":47,"box":{"x":605,"y":626,"width":190,"height":9}},{"id":"619bf67c-43e6-416a-890d-33b9990e607e","block_type":"box","text":"Matthew Kraeger $50,001 - $100,000","page_number":47,"box":{"x":117,"y":644,"width":661,"height":13}},{"id":"ea770426-bbf0-4721-bd87-82eaecf75ae5","block_type":"box","text":"Siddharth Mehta $1 - $10,000","page_number":47,"box":{"x":116,"y":659,"width":630,"height":12}},{"id":"6687bbb4-aba6-4da9-a7ae-a6d3f22748b5","block_type":"box","text":"Ibrahim Incoglu $100,001 - $500,000","page_number":47,"box":{"x":117,"y":675,"width":660,"height":13}},{"id":"193507b1-31bd-4980-8ac2-67c3dc8a20b5","block_type":"box","text":"Samir Lakhani $100,001 - $500,000","page_number":47,"box":{"x":116,"y":690,"width":661,"height":12}},{"id":"2763fc70-a95f-43da-87f8-e6a348bc9c22","block_type":"box","text":"Codes of Ethics.","page_number":47,"box":{"x":116,"y":722,"width":130,"height":10}},{"id":"8d2f3ba8-005c-4302-ba53-b81802be6000","block_type":"box","text":"The Trust, BFA and the Distributor have adopted codes of ethics pursuant to","page_number":47,"box":{"x":253,"y":722,"width":568,"height":12}},{"id":"2fb467f7-df49-4dc0-857c-e3c4126a146f","block_type":"box","text":"Rule 17j-1 under the Investment Company Act. The codes of ethics permit personnel subject to the","page_number":47,"box":{"x":117,"y":738,"width":734,"height":12}},{"id":"7c21f0bc-22eb-4084-80a9-5c8f3718b3da","block_type":"box","text":"codes of ethics to invest in securities, subject to certain limitations, including securities that may be","page_number":47,"box":{"x":116,"y":753,"width":733,"height":12}},{"id":"cc2320d2-96c1-4d98-a305-f1385f0d05b7","block_type":"box","text":"purchased or held by the Fund. Each code of ethics is available by contacting BlackRock at the","page_number":47,"box":{"x":117,"y":769,"width":705,"height":12}},{"id":"62ce64de-09b1-4752-9dd7-935110ca0cb0","block_type":"box","text":"telephone number on the back cover of the Fund’s Prospectus or by accessing the EDGAR Database","page_number":47,"box":{"x":116,"y":784,"width":754,"height":12}},{"id":"8e740431-6319-4dd6-9753-dd2f03be9e16","block_type":"box","text":"on the SEC’s Internet site at http://www.sec.gov, and copies may be obtained, after paying a","page_number":47,"box":{"x":116,"y":800,"width":686,"height":12}},{"id":"d585f744-5eeb-4d01-979b-899a45216ac1","block_type":"box","text":"duplicating fee, by e-mail at publicinfo@sec.gov.","page_number":47,"box":{"x":116,"y":815,"width":359,"height":12}},{"id":"7d192398-9f4f-4903-9c59-711ba2677fd7","block_type":"box","text":"Anti-Money Laundering Requirements.","page_number":47,"box":{"x":116,"y":846,"width":308,"height":12}},{"id":"bd61d9b5-c205-4453-a320-2686ed165277","block_type":"box","text":"The Fund is subject to the USA PATRIOT Act (the “Patriot","page_number":47,"box":{"x":425,"y":846,"width":442,"height":12}},{"id":"05f75f09-e026-40a3-9ffe-ed94d0e512e1","block_type":"box","text":"Act”). The Patriot Act is intended to prevent the use of the U.S. financial system in furtherance of","page_number":47,"box":{"x":116,"y":862,"width":722,"height":12}},{"id":"8c006b51-4725-4249-b766-154de9725fcd","block_type":"box","text":"money laundering, terrorism or other illicit activities. Pursuant to requirements under the Patriot Act, the","page_number":47,"box":{"x":117,"y":877,"width":771,"height":12}},{"id":"286ba11f-f5c5-4453-b660-8b87effa3f9d","block_type":"box","text":"42","page_number":47,"box":{"x":490,"y":909,"width":18,"height":9}},{"id":"ddd01307-aa8f-4128-8276-06fdfa45b503","block_type":"box","text":"NM0926U-5926888-47/257","page_number":47,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"88d8f0bd-19cc-4b76-a64f-d9c5c5a21a46","block_type":"box","text":"Fund may request information from Authorized Participants to enable it to form a reasonable belief that","page_number":48,"box":{"x":117,"y":87,"width":767,"height":12}},{"id":"1a233fb1-9c72-4ec5-a2d6-236f900cbea7","block_type":"box","text":"it knows the true identity of its Authorized Participants. This information will be used to verify the","page_number":48,"box":{"x":117,"y":102,"width":715,"height":13}},{"id":"58fff960-9254-4878-8b9a-caefdd70088b","block_type":"box","text":"identity of Authorized Participants or, in some cases, the status of financial professionals; it will be","page_number":48,"box":{"x":117,"y":118,"width":730,"height":12}},{"id":"86087697-88a9-4145-89cb-5efb0c31a40f","block_type":"box","text":"used only for compliance with the requirements of the Patriot Act.","page_number":48,"box":{"x":117,"y":134,"width":489,"height":12}},{"id":"0a292109-caf8-45d7-808a-a18bd9e10ec1","block_type":"box","text":"The Fund reserves the right to reject purchase orders from persons who have not submitted","page_number":48,"box":{"x":116,"y":163,"width":688,"height":12}},{"id":"9c522039-9c88-4d0f-8484-b8570f2949b3","block_type":"box","text":"information sufficient to allow the Fund to verify their identity. The Fund also reserves the right to","page_number":48,"box":{"x":117,"y":178,"width":720,"height":12}},{"id":"3d032cd8-212f-4304-83e1-143bb9b75d83","block_type":"box","text":"redeem any amounts in the Fund from persons whose identity it is unable to verify on a timely basis. It","page_number":48,"box":{"x":117,"y":194,"width":762,"height":12}},{"id":"becc8441-4f3e-4717-b8dd-e239003b2135","block_type":"box","text":"is the Fund’s policy to cooperate fully with appropriate regulators in any investigations conducted with","page_number":48,"box":{"x":117,"y":209,"width":756,"height":12}},{"id":"92fdb4c7-dc33-4a1c-b59a-505a00bc3f0e","block_type":"box","text":"respect to potential money laundering, terrorism or other illicit activities.","page_number":48,"box":{"x":117,"y":225,"width":533,"height":12}},{"id":"440569de-be68-49b0-895b-d7d06b99e690","block_type":"box","text":"Administrator, Custodian and Transfer Agent.","page_number":48,"box":{"x":116,"y":254,"width":364,"height":12}},{"id":"c9054bbe-d1dc-49ba-b363-4cb1c29bd6a0","block_type":"box","text":"JPMorgan Chase Bank, N.A. (“JPMorgan”) serves as","page_number":48,"box":{"x":481,"y":254,"width":406,"height":12}},{"id":"268d6983-df6c-4d82-9bc1-494e73ca12ca","block_type":"box","text":"administrator, custodian and transfer agent for the Fund under the Master Services Agreement","page_number":48,"box":{"x":116,"y":269,"width":708,"height":12}},{"id":"ff9f9418-08c8-498e-94e5-2666d7963cf6","block_type":"box","text":"(the “Master Services Agreement”). JPMorgan’s principal address is 270 Park Avenue, New York,","page_number":48,"box":{"x":117,"y":285,"width":730,"height":12}},{"id":"b3ec4f59-93d6-409d-b0c7-41d4cba89e02","block_type":"box","text":"NY 10017. Pursuant to the Master Services Agreement with the Trust, JPMorgan provides necessary","page_number":48,"box":{"x":117,"y":300,"width":756,"height":12}},{"id":"5afd39c8-e79e-4d13-9200-84fb21a1212e","block_type":"box","text":"administrative, legal, tax and accounting and financial reporting services for the maintenance and","page_number":48,"box":{"x":116,"y":316,"width":727,"height":12}},{"id":"083d95d1-79bd-4bca-ad5f-b1e39782df23","block_type":"box","text":"operations of the Trust and the Fund. In addition, JPMorgan makes available the office space,","page_number":48,"box":{"x":116,"y":331,"width":703,"height":12}},{"id":"fb83ca86-753a-402f-87c9-5851c16d1a77","block_type":"box","text":"equipment, personnel and facilities required to provide such services. JPMorgan maintains, in separate","page_number":48,"box":{"x":116,"y":347,"width":771,"height":12}},{"id":"bdce55ae-601d-4100-b590-dc8b08021c98","block_type":"box","text":"accounts, cash, securities and other assets of the Trust and the Fund, keeps all necessary accounts","page_number":48,"box":{"x":116,"y":362,"width":749,"height":12}},{"id":"1058116f-c311-41d6-92c7-c2d7fc6d0d86","block_type":"box","text":"and records and provides other services. JPMorgan is required, upon the order of the Trust, to deliver","page_number":48,"box":{"x":116,"y":378,"width":760,"height":12}},{"id":"f1d08a4e-af47-4746-98a1-ad9aa6e72393","block_type":"box","text":"securities held by JPMorgan and to make payments for securities purchased by the Trust for the Fund.","page_number":48,"box":{"x":116,"y":393,"width":768,"height":12}},{"id":"8ae3255e-82b2-480b-a395-8755bb1b578b","block_type":"box","text":"JPMorgan is authorized to appoint certain foreign custodians or foreign custody managers for Fund","page_number":48,"box":{"x":116,"y":409,"width":742,"height":12}},{"id":"5bd56c8c-f543-4e09-bef0-2fb0fb2e570d","block_type":"box","text":"investments outside the U.S. JPMorgan acts as a transfer agent for the Fund’s authorized and issued","page_number":48,"box":{"x":117,"y":424,"width":757,"height":12}},{"id":"659f926d-6076-4a4c-946c-edac33718a9a","block_type":"box","text":"shares of beneficial interest, and as dividend disbursing agent of the Trust. As compensation for these","page_number":48,"box":{"x":116,"y":440,"width":763,"height":12}},{"id":"108f5374-79d1-4f8d-a25b-a0c720963402","block_type":"box","text":"services, JPMorgan receives certain out-of-pocket costs, transaction fees and asset-based fees which","page_number":48,"box":{"x":116,"y":455,"width":763,"height":12}},{"id":"adcd1373-376b-4c48-a8af-06f22f97dad1","block_type":"box","text":"are accrued daily and paid monthly by BFA from its management fee. BFA pays the compensation","page_number":48,"box":{"x":116,"y":471,"width":736,"height":12}},{"id":"116a304d-6a65-47a4-a928-2354429f937f","block_type":"box","text":"because it has agreed to pay these operating expenses under the Investment Advisory Agreement as","page_number":48,"box":{"x":117,"y":486,"width":759,"height":12}},{"id":"4ead9068-f8f6-4dd6-942b-9ae8ba278ce9","block_type":"box","text":"described therein.","page_number":48,"box":{"x":116,"y":502,"width":138,"height":9}},{"id":"c0ef86a1-d700-46e6-9c66-d90aa37cbe2f","block_type":"box","text":"As of the date of this SAI, the Fund has not made any payments to JPMorgan for its services as","page_number":48,"box":{"x":116,"y":531,"width":717,"height":12}},{"id":"25da3361-8a8b-4afa-a826-aedda22a001d","block_type":"box","text":"administrator, custodian and transfer agent for the Fund.","page_number":48,"box":{"x":116,"y":546,"width":425,"height":12}},{"id":"1316e177-8f0a-497a-b27f-36f941f5a038","block_type":"box","text":"Pursuant to a Shareholders’ Administrative Services Agreement, BAL provided certain shareholder","page_number":48,"box":{"x":117,"y":575,"width":738,"height":12}},{"id":"9ed3746f-61aa-48ec-84bd-b7e1ffe1ef20","block_type":"box","text":"liaison services in connection with the Predecessor Fund’s investor service center. The Predecessor","page_number":48,"box":{"x":117,"y":591,"width":749,"height":9}},{"id":"eed6f724-20b3-4a1b-ab6c-29ad7e334ed2","block_type":"box","text":"Fund reimbursed BAL for its costs in maintaining the service center, which costs include, among other","page_number":48,"box":{"x":117,"y":606,"width":761,"height":12}},{"id":"3d2de4af-787d-42ac-b9bb-4538884df998","block_type":"box","text":"things, employee salaries, leasehold expenses, and other out-of-pocket expenses which are a","page_number":48,"box":{"x":116,"y":622,"width":703,"height":12}},{"id":"d2d6bcc6-091f-4bba-9c5f-f5673819baae","block_type":"box","text":"component of the transfer agency fees in the Predecessor Fund’s annual report.","page_number":48,"box":{"x":116,"y":637,"width":600,"height":12}},{"id":"ac575f56-128c-4a21-a433-85280620d67f","block_type":"box","text":"Set forth below are the amounts the Predecessor Fund reimbursed BAL pursuant to the Shareholders’","page_number":48,"box":{"x":116,"y":666,"width":759,"height":12}},{"id":"143b6f1e-aa61-4f0b-b31a-56e92ee2634a","block_type":"box","text":"Administrative Services Agreement for the periods indicated:","page_number":48,"box":{"x":116,"y":682,"width":449,"height":12}},{"id":"70b453a1-9b96-4e43-8ef1-05432d1828f7","block_type":"box","text":"Fees Paid to BAL","page_number":48,"box":{"x":624,"y":708,"width":109,"height":7}},{"id":"125129a7-6e37-4898-bf25-01d0b0f362fe","block_type":"box","text":"Fees Waived by BAL","page_number":48,"box":{"x":752,"y":708,"width":131,"height":9}},{"id":"f57de26a-55fb-43b9-a32c-4700ba2d3445","block_type":"box","text":"Fiscal Period from May 1, 2025 to January 23, 2026 $1,693 $1,693","page_number":48,"box":{"x":117,"y":726,"width":725,"height":13}},{"id":"b7703b99-9f2e-4649-ab9e-04f259e15e27","block_type":"box","text":"Fiscal Year Ended April 30, 2025 $5,165 $5,165","page_number":48,"box":{"x":117,"y":741,"width":725,"height":13}},{"id":"b91e2f78-9147-4bdd-ae49-3e84aa27d053","block_type":"box","text":"Fiscal Year Ended April 30, 2024 $6,291 $6,291","page_number":48,"box":{"x":117,"y":757,"width":723,"height":12}},{"id":"44725ac4-d612-491b-b195-dcb07f61abbd","block_type":"box","text":"In addition, the table below shows the amounts paid by the Predecessor Fund to JPMorgan for","page_number":48,"box":{"x":117,"y":787,"width":703,"height":12}},{"id":"ec20c46a-b591-468c-9b55-aef8e65a8f27","block_type":"box","text":"accounting services for the periods indicated:","page_number":48,"box":{"x":116,"y":802,"width":335,"height":12}},{"id":"3d2f7312-e478-48e5-a8db-6601ae09b61b","block_type":"box","text":"Fees Paid to JPMorgan","page_number":48,"box":{"x":736,"y":828,"width":146,"height":10}},{"id":"c6e46c47-27ee-41e8-835f-b01d5a3a2ceb","block_type":"box","text":"Fiscal Period from May 1, 2025 to January 23, 2026 $36,656","page_number":48,"box":{"x":117,"y":846,"width":727,"height":13}},{"id":"1c474474-a53e-4133-b4b2-2c0dee60f288","block_type":"box","text":"Fiscal Year Ended April 30, 2025 $52,645","page_number":48,"box":{"x":117,"y":861,"width":727,"height":13}},{"id":"1d9200f6-ebf8-4633-8727-c86fc3a07400","block_type":"box","text":"Fiscal Year Ended April 30, 2024 $64,486","page_number":48,"box":{"x":117,"y":877,"width":727,"height":13}},{"id":"27b5b7c5-953c-4798-ac4a-5cea81542312","block_type":"box","text":"43","page_number":48,"box":{"x":490,"y":909,"width":18,"height":9}},{"id":"f2522d35-4e1b-43d6-8744-c32362dbca98","block_type":"box","text":"NM0926U-5926888-48/257","page_number":48,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"cf2644b7-f657-43d5-a614-2437c4473503","block_type":"box","text":"Credit Agreement.","page_number":49,"box":{"x":116,"y":87,"width":150,"height":12}},{"id":"50cc7e30-521a-4752-a64f-c68c719ac1cf","block_type":"box","text":"The Trust, on behalf of the Fund, along w","page_number":49,"box":{"x":267,"y":87,"width":295,"height":12}},{"id":"bcff40da-46f2-407e-b11d-ebec9e1f71e4","block_type":"box","text":"with certain other funds managed by BFA","page_number":49,"box":{"x":562,"y":87,"width":314,"height":12}},{"id":"72e0d566-b19a-4371-aa13-e9dc14f61121","block_type":"box","text":"and its affiliates (“Participating Funds”), is party to a 364-day, $2.4 billion credit agreement with a group","page_number":49,"box":{"x":116,"y":102,"width":771,"height":13}},{"id":"8d761cf8-b910-4692-8340-ab7761702198","block_type":"box","text":"of lenders, which facility terminates on April 8, 2027, unless otherwise extended or renewed (the","page_number":49,"box":{"x":116,"y":118,"width":719,"height":12}},{"id":"590a2c99-4a0f-4f35-a27f-4585611cd062","block_type":"box","text":"“Credit Agreement”). Excluding commitments designated for certain Participating Funds, the","page_number":49,"box":{"x":116,"y":134,"width":688,"height":12}},{"id":"f643c052-7365-49f2-870b-94342a4de5b5","block_type":"box","text":"Participating Funds, including the Fund, can borrow up to an aggregate commitment amount of","page_number":49,"box":{"x":117,"y":149,"width":709,"height":12}},{"id":"8e1efa57-eef5-43f1-a7ec-ad7dbe289053","block_type":"box","text":"$1.75 billion at any time outstanding, subject to asset coverage and other limitations as specified in the","page_number":49,"box":{"x":116,"y":164,"width":768,"height":13}},{"id":"c544632f-f4c7-443f-8cab-4f64276e8c29","block_type":"box","text":"Credit Agreement. The Fund may borrow under the Credit Agreement to meet shareholder","page_number":49,"box":{"x":117,"y":180,"width":676,"height":12}},{"id":"287e1bfe-e968-490c-8630-65f73d55acb6","block_type":"box","text":"redemptions and for other lawful purposes. However, the Fund may not borrow under the Credit","page_number":49,"box":{"x":117,"y":196,"width":716,"height":12}},{"id":"99406a44-fd7b-4361-922f-b26a325b3f5e","block_type":"box","text":"Agreement for leverage. The Fund may borrow up to the maximum amount allowable under its current","page_number":49,"box":{"x":116,"y":211,"width":764,"height":12}},{"id":"4257da31-37f5-4b7d-97f1-22f6596ebdba","block_type":"box","text":"Prospectus and SAI, subject to various other legal, regulatory or contractual limits. Borrowing results in","page_number":49,"box":{"x":117,"y":227,"width":767,"height":12}},{"id":"ffd7d314-4b30-4f78-8345-dad5f073cb84","block_type":"box","text":"interest expense and other fees and expenses for the Fund which may impact the Fund’s net","page_number":49,"box":{"x":117,"y":242,"width":694,"height":12}},{"id":"445b9bd3-4bcd-4b48-9b94-b5c8837480ce","block_type":"box","text":"expenses. The costs of borrowing may reduce the Fund’s return. The Fund is charged its pro rata","page_number":49,"box":{"x":116,"y":258,"width":729,"height":12}},{"id":"81c5d384-a03a-4a9b-b6a5-3effedafdb25","block_type":"box","text":"share of upfront fees and commitment fees on the aggregate commitment amount based on its net","page_number":49,"box":{"x":116,"y":273,"width":738,"height":12}},{"id":"7c6c97bd-fd4d-4c6b-810f-5e649e61c026","block_type":"box","text":"assets. If the Fund borrows pursuant to the Credit Agreement, the Fund will be charged interest at a","page_number":49,"box":{"x":116,"y":289,"width":747,"height":12}},{"id":"a36e987b-5ce4-4915-a2b5-d339003b35f9","block_type":"box","text":"variable rate.","page_number":49,"box":{"x":116,"y":304,"width":102,"height":10}},{"id":"451d25d6-289c-4d0e-bfc2-b07ec0b915ae","block_type":"box","text":"Distributor.","page_number":49,"box":{"x":117,"y":335,"width":88,"height":10}},{"id":"5292225c-ae8a-45b4-a6ed-44663092ab1c","block_type":"box","text":"The Distributor’s principal address is 50 Hudson Yards, New York, NY 10001. Shares are","page_number":49,"box":{"x":206,"y":335,"width":674,"height":12}},{"id":"1d3bed1d-a5ff-46a7-b072-58af207ad75a","block_type":"box","text":"continuously offered for sale by the Fund through the Distributor or its agent only in Creation Units, as","page_number":49,"box":{"x":116,"y":351,"width":760,"height":12}},{"id":"cabaa41f-67b7-46c0-8d69-18482effc703","block_type":"box","text":"described in the Prospectus and below in the Creation and Redemption of Creation Units section of","page_number":49,"box":{"x":116,"y":366,"width":742,"height":12}},{"id":"907f503e-4b91-4bab-af2a-c03d9b24fc28","block_type":"box","text":"this SAI. Fund shares in amounts less than Creation Units are generally not distributed by the","page_number":49,"box":{"x":116,"y":382,"width":699,"height":12}},{"id":"91ebc391-0856-43af-8b2c-13563334e99b","block_type":"box","text":"Distributor or its agent. The Distributor or its agent will arrange for the delivery of the Prospectus and,","page_number":49,"box":{"x":117,"y":397,"width":755,"height":12}},{"id":"380d7d1b-4713-404b-86a7-501369e65e15","block_type":"box","text":"upon request, this SAI to persons purchasing Creation Units and will maintain records of both orders","page_number":49,"box":{"x":117,"y":413,"width":749,"height":12}},{"id":"cd9d9c59-c886-4b0c-ab05-097203af96d8","block_type":"box","text":"placed with it or its agents and confirmations of acceptance furnished by it or its agents. The Distributor","page_number":49,"box":{"x":117,"y":428,"width":770,"height":12}},{"id":"adf05e70-f00d-4128-a5a7-eecf210d4d08","block_type":"box","text":"is a broker-dealer registered under the 1934 Act and a member of the Financial Industry Regulatory","page_number":49,"box":{"x":117,"y":444,"width":744,"height":12}},{"id":"46513539-4c3d-45f6-8fc4-91fc064b9fb2","block_type":"box","text":"Authority, Inc. (“FINRA”). The Distributor is also licensed as a broker-dealer in all 50 U.S. states, as","page_number":49,"box":{"x":116,"y":459,"width":742,"height":12}},{"id":"c46ac083-d930-451d-8e9b-f18c5b06b1cc","block_type":"box","text":"well as in Puerto Rico, the U.S. Virgin Islands and the District of Columbia.","page_number":49,"box":{"x":116,"y":475,"width":558,"height":12}},{"id":"eb596859-40d8-4bb9-a6cf-11460db489a8","block_type":"box","text":"The Distribution Agreement for the Fund provides that it may be terminated at any time, without the","page_number":49,"box":{"x":116,"y":506,"width":741,"height":12}},{"id":"1ded1a93-56c3-4718-9153-17ff8c36598f","block_type":"box","text":"payment of any penalty, on at least 60 days’ prior written notice to the other party following (i) the vote","page_number":49,"box":{"x":117,"y":521,"width":761,"height":12}},{"id":"cdd491d0-bdcb-4ae2-a770-ac124e6e2939","block_type":"box","text":"of a majority of the Independent Trustees, or (ii) the vote of a majority of the outstanding voting","page_number":49,"box":{"x":116,"y":537,"width":709,"height":12}},{"id":"25293cae-f3e2-461a-8013-827ff21819e3","block_type":"box","text":"securities (as defined in the Investment Company Act) of the Fund. The Distribution Agreement will","page_number":49,"box":{"x":116,"y":552,"width":740,"height":12}},{"id":"61af37bc-bb7e-4b9d-90a4-1a9091b93471","block_type":"box","text":"terminate automatically in the event of its assignment (as defined in the Investment Company Act).","page_number":49,"box":{"x":116,"y":568,"width":737,"height":12}},{"id":"14cabe73-9f89-479c-9879-048f8a60bf7b","block_type":"box","text":"The Distributor may also enter into agreements with securities dealers (“Soliciting Dealers”) who will","page_number":49,"box":{"x":116,"y":599,"width":746,"height":12}},{"id":"d6ee8ce3-5aab-494f-a845-2b406452cec8","block_type":"box","text":"solicit purchases of Creation Units of Fund shares. Such Soliciting Dealers may also be Authorized","page_number":49,"box":{"x":116,"y":614,"width":739,"height":12}},{"id":"4a3ae8e7-d851-4c4b-951e-1d5c8efafb7a","block_type":"box","text":"Participants (as described below), Depository Trust Company (“DTC”) participants and/or investor","page_number":49,"box":{"x":117,"y":630,"width":729,"height":12}},{"id":"8480b262-667a-409e-89bb-2ab34dda288d","block_type":"box","text":"services organizations.","page_number":49,"box":{"x":116,"y":645,"width":176,"height":12}},{"id":"abaf8c87-2afa-48f1-9ab7-ad36007a96cd","block_type":"box","text":"BFA or its affiliates may, from time to time and from its own resources, pay, defray or absorb costs","page_number":49,"box":{"x":117,"y":676,"width":729,"height":12}},{"id":"8c68cd53-5d68-4921-84c1-ad087662c6fd","block_type":"box","text":"relating to distribution, including payments out of its own resources to the Distributor, or to otherwise","page_number":49,"box":{"x":117,"y":692,"width":742,"height":12}},{"id":"07513065-a2a9-49ce-b958-4a6b4db53417","block_type":"box","text":"promote the sale of shares.","page_number":49,"box":{"x":117,"y":707,"width":201,"height":12}},{"id":"3e60eec9-619a-427d-b5a6-fd352bfbeb2e","block_type":"box","text":"Predecessor Fund’s Distribution Agreement and Distribution and Service Plan.","page_number":49,"box":{"x":117,"y":738,"width":628,"height":12}},{"id":"6bd521e2-3ce6-4024-8107-72295d8a9797","block_type":"box","text":"The Predecessor","page_number":49,"box":{"x":751,"y":738,"width":128,"height":10}},{"id":"bd9e37fd-5734-49a9-baf6-1b232f829ead","block_type":"box","text":"Trust had entered into a distribution agreement with BRIL under which BRIL, as agent, offered shares","page_number":49,"box":{"x":116,"y":754,"width":754,"height":12}},{"id":"996527e1-5bc8-441b-92dc-d3d68a62dd30","block_type":"box","text":"of the Predecessor Fund on a continuous basis. BRIL had agreed to use appropriate efforts to effect","page_number":49,"box":{"x":116,"y":769,"width":745,"height":12}},{"id":"6b3e5296-64e8-49a1-b402-2f7552fd9f44","block_type":"box","text":"sales of the Predecessor Fund’s shares, but it was not obligated to sell any particular amount of","page_number":49,"box":{"x":116,"y":785,"width":711,"height":12}},{"id":"c197a583-c078-46e2-896f-aa98b5344309","block_type":"box","text":"shares.","page_number":49,"box":{"x":116,"y":800,"width":53,"height":10}},{"id":"9c2570ef-de36-4504-b3cc-d58c8ca8ec9e","block_type":"box","text":"The Predecessor Trust also paid shareholder servicing fees (also referred to as general shareholder","page_number":49,"box":{"x":116,"y":831,"width":749,"height":12}},{"id":"ee20b37c-bae4-4575-bda2-60a4611a916a","block_type":"box","text":"liaison services fees) to affiliated and unaffiliated brokers, dealers, financial institutions, insurance","page_number":49,"box":{"x":117,"y":847,"width":727,"height":12}},{"id":"e8e8050b-2d2a-4f01-825c-f1a5b72d1104","block_type":"box","text":"companies, retirement plan record-keepers and other financial intermediaries (including BlackRock","page_number":49,"box":{"x":116,"y":862,"width":739,"height":12}},{"id":"b07440bc-d627-4d00-823e-a83d7c170f15","block_type":"box","text":"Advisors, LLC (the “Predecessor Manager”), BRIL and their affiliates) (collectively, “Service","page_number":49,"box":{"x":116,"y":878,"width":682,"height":12}},{"id":"63df1034-d82b-4ccc-b91e-e106aad1253f","block_type":"box","text":"44","page_number":49,"box":{"x":490,"y":909,"width":18,"height":9}},{"id":"cb09d41b-1ed5-4a57-85ac-9b0b01ed5e7d","block_type":"box","text":"NM0926U-5926888-49/257","page_number":49,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"23cb0b4e-3d12-46cd-8418-f211da85ff10","block_type":"box","text":"Organizations”) for certain support services rendered by Service Organizations to their customers who","page_number":50,"box":{"x":116,"y":87,"width":764,"height":12}},{"id":"af4ab4ce-5356-4ade-b3fe-64a81ca8d200","block_type":"box","text":"were the beneficial owners of Investor A and Investor C Shares of the Predecessor Fund.","page_number":50,"box":{"x":116,"y":102,"width":669,"height":10}},{"id":"a821fc52-0838-4b0d-8319-d9a40d2b00a9","block_type":"box","text":"Set forth below is information on sales charges (including any contingent deferred sales charges","page_number":50,"box":{"x":116,"y":134,"width":720,"height":12}},{"id":"fac0fc4f-26ec-4bdd-a2b4-28a4682d77b7","block_type":"box","text":"(“CDSCs”)) received by the Predecessor Fund, including the amounts paid to affiliates of the","page_number":50,"box":{"x":117,"y":149,"width":690,"height":12}},{"id":"ebf01313-5fe1-4a72-867b-bc98e3adf416","block_type":"box","text":"Predecessor Manager, for the periods indicated.","page_number":50,"box":{"x":117,"y":165,"width":363,"height":12}},{"id":"238ccd8e-12d2-4202-be1c-13d9fdf84e05","block_type":"box","text":"Investor A Sales Charge Information","page_number":50,"box":{"x":117,"y":196,"width":275,"height":12}},{"id":"df53e9a0-c2af-4f37-b44b-5543a61c256b","block_type":"box","text":"Investor A Shares","page_number":50,"box":{"x":580,"y":208,"width":113,"height":7}},{"id":"d57226b7-63ec-4039-b037-8296bafdfb90","block_type":"box","text":"Gross Sales","page_number":50,"box":{"x":410,"y":244,"width":76,"height":8}},{"id":"827bcf12-8c16-4243-a969-d69b8b72d03f","block_type":"box","text":"Charges Collected","page_number":50,"box":{"x":389,"y":254,"width":117,"height":10}},{"id":"f99d18d7-df9a-4c3d-b0a3-9eaed60f681f","block_type":"box","text":"Sales Charges","page_number":50,"box":{"x":525,"y":244,"width":92,"height":10}},{"id":"7be3e1f7-8a2b-4bf4-af04-cd2f4954967e","block_type":"box","text":"Retained by BRIL","page_number":50,"box":{"x":517,"y":254,"width":110,"height":10}},{"id":"476a5873-e10a-498d-91e6-79b3ab7e4204","block_type":"box","text":"Sales Charges Paid","page_number":50,"box":{"x":636,"y":234,"width":124,"height":9}},{"id":"bd10f72d-06e4-452e-9184-5709f9b11749","block_type":"box","text":"to the Predecessor","page_number":50,"box":{"x":637,"y":244,"width":122,"height":8}},{"id":"96dc28c6-d3bf-4c5f-a920-e80e8580a527","block_type":"box","text":"Manager","page_number":50,"box":{"x":671,"y":254,"width":55,"height":10}},{"id":"36c08192-3e2a-4cba-9b8d-9aa8b65e5828","block_type":"box","text":"CDSCs Received","page_number":50,"box":{"x":772,"y":223,"width":108,"height":8}},{"id":"b584aeb6-4571-4699-bf82-56afa810a69e","block_type":"box","text":"on Redemption of","page_number":50,"box":{"x":769,"y":234,"width":115,"height":9}},{"id":"f77c07ce-6543-4e53-bcc1-1a60d2c85352","block_type":"box","text":"Load-Waived","page_number":50,"box":{"x":785,"y":244,"width":82,"height":8}},{"id":"c6cc23f0-c405-41e4-ba82-43086f091637","block_type":"box","text":"Shares","page_number":50,"box":{"x":804,"y":254,"width":44,"height":8}},{"id":"7d73bd45-5db6-442c-b784-77eaf8a1e842","block_type":"box","text":"Fiscal Period May 1, 2025 –","page_number":50,"box":{"x":117,"y":273,"width":212,"height":12}},{"id":"5be26ad2-cebe-4488-9c22-02775c166e41","block_type":"box","text":"January 23, 2026 $11,947 $1,068 $1,068 $ 0","page_number":50,"box":{"x":133,"y":288,"width":716,"height":13}},{"id":"bf21d96d-c718-4755-ad4e-059f09f6b785","block_type":"box","text":"Fiscal Year Ended April 30, 2025 $16,469 $1,307 $1,307 $232","page_number":50,"box":{"x":117,"y":303,"width":732,"height":13}},{"id":"c788b7ae-9597-4b0f-b279-40a6aa27d114","block_type":"box","text":"Fiscal Year Ended April 30, 2024 $ 5,589 $ 422 $ 422 $ 0","page_number":50,"box":{"x":117,"y":319,"width":732,"height":13}},{"id":"d463a152-9ee8-4c3d-b622-37bcbe832899","block_type":"box","text":"Investor C Sales Charge Information","page_number":50,"box":{"x":117,"y":351,"width":276,"height":12}},{"id":"46419456-1977-481d-9398-185402f7bb00","block_type":"box","text":"Investor C Shares","page_number":50,"box":{"x":725,"y":363,"width":113,"height":7}},{"id":"631fe498-acce-4096-9f38-fc70c9125e7e","block_type":"box","text":"CDSCs Received","page_number":50,"box":{"x":681,"y":378,"width":107,"height":8}},{"id":"e5991c99-7c9c-4bda-8f62-440c1f16062d","block_type":"box","text":"By BRIL","page_number":50,"box":{"x":709,"y":389,"width":51,"height":9}},{"id":"832fe439-b5ba-4e1d-bd69-65629622b656","block_type":"box","text":"CDSCs Paid","page_number":50,"box":{"x":806,"y":378,"width":76,"height":8}},{"id":"460f4992-d47e-4b41-a19d-220a609cdc70","block_type":"box","text":"To Affiliates","page_number":50,"box":{"x":806,"y":389,"width":76,"height":7}},{"id":"05b8a353-d0dd-49c5-8ca4-6a81eae4aabb","block_type":"box","text":"Fiscal Period May 1, 2025 – January 23, 2026 $ 0 $ 0","page_number":50,"box":{"x":117,"y":407,"width":751,"height":13}},{"id":"ec9afbf8-f2ae-4bd7-b8d6-0937a1521cab","block_type":"box","text":"Fiscal Year Ended April 30, 2025 $380 $380","page_number":50,"box":{"x":117,"y":422,"width":751,"height":13}},{"id":"3922d020-322e-48ce-878c-31aa89af331b","block_type":"box","text":"Fiscal Year Ended April 30, 2024 $ 7 $ 7","page_number":50,"box":{"x":117,"y":438,"width":751,"height":12}},{"id":"550fbb45-c251-4b4f-baf8-3631bab7a061","block_type":"box","text":"The table below provides information for the period May 1, 2025 - January 23, 2026 about the 12b-1","page_number":50,"box":{"x":116,"y":469,"width":748,"height":13}},{"id":"ffa246de-7162-4bb3-acdd-526c94bca02a","block_type":"box","text":"fees the Predecessor Fund paid to BRIL under the Predecessor Fund’s 12b-1 plans. A significant","page_number":50,"box":{"x":116,"y":485,"width":727,"height":12}},{"id":"72bc9856-5a4e-4f24-9c59-ca21a06df16d","block_type":"box","text":"amount of the fees collected by BRIL were paid to affiliates, for providing shareholder servicing","page_number":50,"box":{"x":116,"y":500,"width":709,"height":13}},{"id":"2684d4eb-0c42-4003-9ecb-fd26569b89c2","block_type":"box","text":"activities for Investor A Shares and for providing shareholder servicing and distribution-related activities","page_number":50,"box":{"x":116,"y":516,"width":772,"height":12}},{"id":"b0d397f7-e546-4730-afd2-d6ed38e4038d","block_type":"box","text":"and services for Investor C Shares.","page_number":50,"box":{"x":116,"y":531,"width":267,"height":10}},{"id":"4952a171-88be-4acb-aee1-81c58cd76fdf","block_type":"box","text":"Class Name","page_number":50,"box":{"x":116,"y":559,"width":76,"height":8}},{"id":"96d1a69e-4d60-40ad-b420-6d8f950ad3f4","block_type":"box","text":"Fees Paid to BRIL","page_number":50,"box":{"x":770,"y":559,"width":113,"height":8}},{"id":"9ca50d72-c447-4624-b1af-02d1ca28c938","block_type":"box","text":"Investor A Shares","page_number":50,"box":{"x":117,"y":578,"width":137,"height":9}},{"id":"314e05fe-13a3-43b9-b0c0-2aee81ebb303","block_type":"box","text":"$24,395","page_number":50,"box":{"x":796,"y":577,"width":65,"height":12}},{"id":"7bdf5e2e-e030-485d-bca0-9422392f2ffd","block_type":"box","text":"Investor C Shares","page_number":50,"box":{"x":117,"y":593,"width":138,"height":10}},{"id":"30f4d641-b334-4523-970a-8f0f2f53d3e6","block_type":"box","text":"$ 4,600","page_number":50,"box":{"x":796,"y":593,"width":65,"height":12}},{"id":"abc5421f-866b-466b-b568-973f06b01d10","block_type":"box","text":"Securities Lending.","page_number":50,"box":{"x":116,"y":624,"width":154,"height":13}},{"id":"848c4edb-3712-4bdc-8182-0cb74e9c7a9a","block_type":"box","text":"To the extent that the Fund engages in securities lending, the Fund conducts its","page_number":50,"box":{"x":271,"y":625,"width":603,"height":12}},{"id":"87453b23-7e93-443e-8e10-a79840a16ead","block_type":"box","text":"securities lending pursuant to an exemptive order from the Commission permitting it to lend portfolio","page_number":50,"box":{"x":116,"y":640,"width":747,"height":12}},{"id":"1d6a8287-6b88-48d7-9d69-47dd336926bd","block_type":"box","text":"securities to borrowers affiliated with the Fund and to retain an affiliate of the Fund as securities","page_number":50,"box":{"x":116,"y":655,"width":715,"height":10}},{"id":"e172e079-2a63-4fce-9295-ac357045f301","block_type":"box","text":"lending agent. To the extent that the Fund engages in securities lending, BTC acts as securities","page_number":50,"box":{"x":117,"y":671,"width":709,"height":12}},{"id":"0d37751d-4670-4bbe-9a7d-6f27d4629fb4","block_type":"box","text":"lending agent for the Fund, subject to the overall supervision of the Manager, pursuant to a written","page_number":50,"box":{"x":117,"y":686,"width":728,"height":13}},{"id":"52ddef18-6ff6-468a-a552-785769a26f84","block_type":"box","text":"agreement (the “Securities Lending Agency Agreement”). BTC administers the lending program in","page_number":50,"box":{"x":116,"y":702,"width":726,"height":12}},{"id":"e5436819-a38e-4b7c-b9a7-35f07c3cab40","block_type":"box","text":"accordance with guidelines approved by the Board.","page_number":50,"box":{"x":116,"y":718,"width":380,"height":12}},{"id":"a2154c15-fa62-4cdc-a53b-43d359311b27","block_type":"box","text":"To the extent the Fund engages in securities lending, the Fund retains a portion of securities lending","page_number":50,"box":{"x":116,"y":748,"width":744,"height":13}},{"id":"a7419a76-669a-42d4-894d-2dfdc9d62d8b","block_type":"box","text":"income and remits a remaining portion to BTC as compensation for its services as securities lending","page_number":50,"box":{"x":117,"y":764,"width":742,"height":12}},{"id":"e5892446-7786-4082-abe4-9b06daa9bdaf","block_type":"box","text":"agent. Securities lending income is generally equal to the total of income earned from the reinvestment","page_number":50,"box":{"x":116,"y":779,"width":764,"height":13}},{"id":"8eb34f68-2686-4ca9-8099-cbcfadec7bdc","block_type":"box","text":"of cash collateral (and excludes collateral investment fees as defined below), and any fees or other","page_number":50,"box":{"x":116,"y":795,"width":735,"height":12}},{"id":"72b5e163-fea3-402e-9101-bae04b5cf9c2","block_type":"box","text":"payments to and from borrowers of securities. As securities lending agent, BTC bears all operational","page_number":50,"box":{"x":117,"y":811,"width":744,"height":12}},{"id":"8ff94ceb-9556-4096-9c74-ccc444bbc42d","block_type":"box","text":"costs directly related to securities lending. The Fund is responsible for fees in connection with the","page_number":50,"box":{"x":116,"y":826,"width":728,"height":12}},{"id":"efa86f40-a1d4-4c17-bbea-4fac59472318","block_type":"box","text":"investment of cash collateral received for securities on loan in a money market fund managed by","page_number":50,"box":{"x":117,"y":842,"width":722,"height":12}},{"id":"ebe274e6-1af3-4829-bc23-d158c7f516f5","block_type":"box","text":"BlackRock (the “collateral investment fees”); however, the securities lending agent has agreed to","page_number":50,"box":{"x":117,"y":857,"width":723,"height":12}},{"id":"87679338-d47e-43f7-a704-8d8ec72b915e","block_type":"box","text":"reduce the amount of securities lending income it receives in order to effectively limit the collateral","page_number":50,"box":{"x":117,"y":873,"width":731,"height":12}},{"id":"eb86bc2c-6edf-4e92-ac27-9566ae615052","block_type":"box","text":"45","page_number":50,"box":{"x":490,"y":909,"width":18,"height":9}},{"id":"f994dea2-e625-483b-943c-6f71c1ee676f","block_type":"box","text":"NM0926U-5926888-50/257","page_number":50,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"b872a1ba-663e-4480-ab3c-7441a6950882","block_type":"box","text":"investment fees a Fund bears to an annual rate of 0.04%. Such money market fund shares will not be","page_number":51,"box":{"x":117,"y":87,"width":759,"height":12}},{"id":"d0eba854-7c59-431e-ba5d-8b98794d9a78","block_type":"box","text":"subject to a sales load, distribution fee or service fee.","page_number":51,"box":{"x":116,"y":102,"width":400,"height":13}},{"id":"86e37a3b-0ce8-4d7e-9615-2e7672ec5658","block_type":"box","text":"To the extent that the Fund invests cash collateral in a non-government money market fund, the Fund","page_number":51,"box":{"x":116,"y":134,"width":760,"height":12}},{"id":"1aa02040-60d3-49ba-b43d-8061426f3b5d","block_type":"box","text":"may be subject to a discretionary liquidity fee of up to 2% on all redemptions. Discretionary liquidity","page_number":51,"box":{"x":117,"y":149,"width":739,"height":12}},{"id":"e5154b74-34e5-4af0-9e38-21a21f5a7375","block_type":"box","text":"fees may be imposed or terminated at any time at the discretion of the board of directors of the money","page_number":51,"box":{"x":116,"y":165,"width":764,"height":12}},{"id":"2e13444f-a25b-4782-9147-6ee0b96c53a6","block_type":"box","text":"market fund, or its delegate, if it is determined that such fee would be, or would not be, respectively, in","page_number":51,"box":{"x":117,"y":180,"width":763,"height":12}},{"id":"a1cd0a62-97e6-431b-88a6-0e82e83a918f","block_type":"box","text":"the best interest of the money market fund. Additionally, the Fund will be subject to a mandatory","page_number":51,"box":{"x":116,"y":196,"width":718,"height":12}},{"id":"6d6b8698-791c-421f-bad2-242c95f5adba","block_type":"box","text":"liquidity fee if the money market fund’s total net redemptions on a single day exceed 5% of the money","page_number":51,"box":{"x":117,"y":211,"width":760,"height":12}},{"id":"6137ada0-e23d-4c29-9dab-07a751a2fa6e","block_type":"box","text":"market fund’s net assets, unless the liquidity costs are de minimis (i.e., less than one basis point","page_number":51,"box":{"x":117,"y":227,"width":718,"height":12}},{"id":"7d211604-65a7-4966-9093-1ee91a485ba6","block_type":"box","text":"(0.01%)). The money market fund will determine the size of the mandatory liquidity fee by making a","page_number":51,"box":{"x":117,"y":242,"width":741,"height":12}},{"id":"f6394a1d-e889-426a-a5b4-e8b16638c5f7","block_type":"box","text":"good faith estimate of certain costs the money market fund would incur if it were to sell a pro rata","page_number":51,"box":{"x":116,"y":258,"width":724,"height":12}},{"id":"e5aff653-6604-4aac-b74a-242d35477db9","block_type":"box","text":"amount of each security in the portfolio to satisfy the amount of net redemptions on that day. There is","page_number":51,"box":{"x":116,"y":273,"width":756,"height":12}},{"id":"5fe6d644-4422-4e56-83ac-a41bf176db24","block_type":"box","text":"no limit to the size of a mandatory liquidity fee. If the money market fund cannot estimate the costs of","page_number":51,"box":{"x":117,"y":289,"width":754,"height":12}},{"id":"e4ce484d-b3b9-453f-9785-18cc76074770","block_type":"box","text":"selling a pro rata amount of each portfolio security in good faith and supported by data, it is required to","page_number":51,"box":{"x":116,"y":304,"width":765,"height":12}},{"id":"a221921c-3352-484b-a99e-e1256a6cb578","block_type":"box","text":"apply a default liquidity fee of 1% on the value of shares redeemed on that day. The imposition of any","page_number":51,"box":{"x":116,"y":320,"width":759,"height":12}},{"id":"bec60fa1-7124-42ff-9be4-dd3bf862e12f","block_type":"box","text":"such discretionary or mandatory liquidity fee would reduce the Fund’s returns on securities lending.","page_number":51,"box":{"x":116,"y":335,"width":741,"height":12}},{"id":"a377650f-c43e-43dd-8f9a-0afe21f50cab","block_type":"box","text":"Under the securities lending program, the Fund is categorized into one of several specific asset","page_number":51,"box":{"x":117,"y":366,"width":712,"height":12}},{"id":"331a9799-4f73-46aa-b7f8-379ef0695a90","block_type":"box","text":"classes. The determination of the Fund’s asset class category (fixed-income, domestic equity,","page_number":51,"box":{"x":116,"y":382,"width":701,"height":12}},{"id":"101c876f-e06d-439c-9592-f97518680742","block_type":"box","text":"international equity, or fund-of-funds), each of which may be subject to a different fee arrangement, is","page_number":51,"box":{"x":117,"y":397,"width":757,"height":12}},{"id":"4f43a45b-33ff-4a63-86ce-745a870985fb","block_type":"box","text":"based on a methodology agreed to by the Trust and BTC.","page_number":51,"box":{"x":117,"y":413,"width":433,"height":12}},{"id":"e879d585-c15a-4119-86e7-e2eba4cbbadc","block_type":"box","text":"Pursuant to the current securities lending agreement: (i) if the Fund was to engage in securities","page_number":51,"box":{"x":117,"y":444,"width":711,"height":12}},{"id":"f5e72875-95ac-43d2-9242-774e0b23261a","block_type":"box","text":"lending, the Fund retains 82% of securities lending income (which excludes collateral investment","page_number":51,"box":{"x":117,"y":459,"width":722,"height":12}},{"id":"8956da59-cdec-4017-88b1-3a5cc464fb44","block_type":"box","text":"expenses), and (ii) this amount can never be less than 70% of the sum of securities lending income","page_number":51,"box":{"x":116,"y":475,"width":743,"height":12}},{"id":"fd565dbc-8453-4e14-b2f5-b81401b7048e","block_type":"box","text":"plus collateral investment expenses.","page_number":51,"box":{"x":117,"y":490,"width":274,"height":12}},{"id":"ef028632-1c42-49f5-b922-694f22d84a23","block_type":"box","text":"In addition, commencing the business day following the date that the aggregate securities lending","page_number":51,"box":{"x":117,"y":521,"width":728,"height":12}},{"id":"7eee1e52-5717-46ba-8063-1eab4fb86e09","block_type":"box","text":"income earned across the BlackRock Fixed-Income Complex in a calendar year exceeds specified","page_number":51,"box":{"x":117,"y":537,"width":736,"height":12}},{"id":"5e2c2150-6d66-4aad-affb-28633ed4044a","block_type":"box","text":"thresholds, the Fund, pursuant to the current securities lending agreement, will receive for the","page_number":51,"box":{"x":116,"y":552,"width":701,"height":12}},{"id":"2524b755-9aa5-43c0-85d8-3680fe192f4c","block_type":"box","text":"remainder of that calendar year securities lending income as follows: if the Fund were to engage in","page_number":51,"box":{"x":117,"y":568,"width":737,"height":12}},{"id":"f9c2afe5-91e2-4d11-be29-0364388fd23b","block_type":"box","text":"securities lending, (i) 85% of securities lending income (which excludes collateral investment","page_number":51,"box":{"x":116,"y":583,"width":692,"height":12}},{"id":"0f874f60-fc53-41b0-8207-5b016f75aa88","block_type":"box","text":"expenses); and (ii) this amount can never be less than 70% of the sum of securities lending income","page_number":51,"box":{"x":116,"y":599,"width":743,"height":12}},{"id":"8c2b0215-0675-4309-8e84-27b8d17d35cb","block_type":"box","text":"plus collateral investment expenses.","page_number":51,"box":{"x":117,"y":614,"width":274,"height":12}},{"id":"e5dd1c92-2843-4b63-ad2e-c94199d827f8","block_type":"box","text":"The Predecessor Fund had no income and fees/compensation related to its securities lending activities","page_number":51,"box":{"x":116,"y":645,"width":770,"height":12}},{"id":"2b58449f-9c3b-46e7-85ca-35fd53550b8b","block_type":"box","text":"during its most recent fiscal year ended April 30, 2026. Because the Fund is newly launched, no","page_number":51,"box":{"x":116,"y":661,"width":712,"height":12}},{"id":"922ff81e-d1a8-42f1-861e-4389e4950111","block_type":"box","text":"services have been provided by BTC as the Fund’s securities lending agent, and the Fund had no","page_number":51,"box":{"x":116,"y":676,"width":726,"height":12}},{"id":"994bdfc7-c34f-43dd-ac09-92770ab3d2e8","block_type":"box","text":"income and fees/compensation related to its securities lending activities as of the date of this SAI.","page_number":51,"box":{"x":117,"y":692,"width":723,"height":12}},{"id":"18fadfbe-258a-4ed3-aaa7-47d6103d6e69","block_type":"box","text":"Payments by BFA and its Affiliates.","page_number":51,"box":{"x":117,"y":723,"width":280,"height":12}},{"id":"17a3fca1-f084-49b6-b1ad-68d2787d451a","block_type":"box","text":"BFA and/or its affiliates (“BFA Entities”) pay certain broker","page_number":51,"box":{"x":404,"y":723,"width":436,"height":12}},{"id":"3ab26826-4c14-4339-a211-11d6ebfc7a17","block_type":"box","text":"dealers, registered investment advisers, banks and other financial intermediaries (“Intermediaries”) for","page_number":51,"box":{"x":116,"y":738,"width":758,"height":12}},{"id":"2bd89620-ed7a-4a3b-a8fd-c8c4263a065b","block_type":"box","text":"certain activities related to the Fund and other funds or products sponsored and/or advised by BFA","page_number":51,"box":{"x":116,"y":754,"width":734,"height":12}},{"id":"66b1fb3f-fa1d-4d81-9b0e-6e0f5aeeaf6e","block_type":"box","text":"Entities (collectively for purposes of this section, the “Products”). BFA Entities make these payments","page_number":51,"box":{"x":117,"y":769,"width":743,"height":12}},{"id":"36c8c9a7-5dbe-443b-971a-81cfe782556f","block_type":"box","text":"from their own assets and not from the assets of the Fund. Although a portion of BFA Entities’ revenue","page_number":51,"box":{"x":116,"y":785,"width":761,"height":12}},{"id":"60767bdd-6ee6-4e97-ac02-bde802dc2464","block_type":"box","text":"comes directly or indirectly in part from fees paid by the Fund or other Products (including, if","page_number":51,"box":{"x":116,"y":800,"width":683,"height":12}},{"id":"e28725f8-1d2a-42c3-a9df-d988ecba9fa3","block_type":"box","text":"applicable, any underlying Products held by the Fund), these payments do not increase the price paid","page_number":51,"box":{"x":116,"y":816,"width":754,"height":12}},{"id":"f1f9de4f-d19f-42e6-8425-1409a14a8c91","block_type":"box","text":"by investors for the purchase of shares of, or the cost of owning, the Fund or other Products. BFA","page_number":51,"box":{"x":117,"y":831,"width":729,"height":12}},{"id":"911bfc2d-8450-494e-91e7-d98a942483c9","block_type":"box","text":"Entities make payments for Intermediaries’ participation in activities that are designed to make","page_number":51,"box":{"x":117,"y":847,"width":703,"height":12}},{"id":"73e9d78e-bde8-489e-b423-a44915501c62","block_type":"box","text":"registered representatives, other professionals and individual investors more knowledgeable about","page_number":51,"box":{"x":117,"y":862,"width":736,"height":12}},{"id":"a29576ec-8d5b-424b-aa43-a829d051e2e8","block_type":"box","text":"exchange-traded products, including the Fund and other Products, or for other activities, such as","page_number":51,"box":{"x":116,"y":878,"width":722,"height":12}},{"id":"e9913f18-6809-4e11-b4fc-4eb5534d369f","block_type":"box","text":"46","page_number":51,"box":{"x":490,"y":909,"width":18,"height":9}},{"id":"93ef4cb9-f1d0-4649-9e9f-7a24919c1c19","block_type":"box","text":"NM0926U-5926888-51/257","page_number":51,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"3b8cb111-ee00-4630-bd3f-95c191106b96","block_type":"box","text":"participation in marketing activities and presentations, educational training programs, conferences, the","page_number":52,"box":{"x":117,"y":87,"width":763,"height":12}},{"id":"7aadc3b8-3522-44ec-809b-a00db9987a16","block_type":"box","text":"development of technology platforms and reporting systems (“Education Costs”). BFA Entities also","page_number":52,"box":{"x":116,"y":102,"width":737,"height":13}},{"id":"cc30a663-6a91-4822-8700-a63c842deade","block_type":"box","text":"make payments to Intermediaries for certain printing, publishing and mailing costs or materials relating","page_number":52,"box":{"x":117,"y":118,"width":764,"height":12}},{"id":"c04a4211-e022-4562-b78a-0ec330b36278","block_type":"box","text":"to the Fund or other Products (“Publishing Costs”). In addition, BFA Entities make payments to","page_number":52,"box":{"x":116,"y":134,"width":707,"height":12}},{"id":"f030321c-7475-496a-a470-6511d5b1bb33","block_type":"box","text":"Intermediaries that make shares of the Fund or other Products available to their clients, in some cases","page_number":52,"box":{"x":117,"y":149,"width":764,"height":11}},{"id":"62c330af-eb76-4636-b6c6-f98a16503cc4","block_type":"box","text":"at a waived or reduced commission rate or ticket charge, develop new products that feature iShares,","page_number":52,"box":{"x":116,"y":165,"width":751,"height":12}},{"id":"8dc1595c-0221-49e6-8333-421f451703b7","block_type":"box","text":"create educational content about the Fund or other Products that is featured on an Intermediary’s","page_number":52,"box":{"x":116,"y":180,"width":727,"height":12}},{"id":"b15e4c07-286a-4364-89e8-d0593b6b0c8f","block_type":"box","text":"platform, or otherwise promote the Fund or other Products. BFA Entities may also reimburse expenses","page_number":52,"box":{"x":117,"y":196,"width":767,"height":12}},{"id":"9ae52db8-15d4-4634-8f47-a92584c2dff5","block_type":"box","text":"or make payments from their own assets to Intermediaries or other persons in consideration of","page_number":52,"box":{"x":116,"y":211,"width":706,"height":12}},{"id":"fb5aac0f-7b18-434a-b234-b795d66f9fb9","block_type":"box","text":"services or other activities that the BFA Entities believe may benefit the business of the BFA Entities or","page_number":52,"box":{"x":116,"y":227,"width":769,"height":12}},{"id":"edb6e541-b894-4b37-9b4a-7589de51c123","block_type":"box","text":"facilitate investment in the Fund or other Products. Payments of the type described above are","page_number":52,"box":{"x":116,"y":242,"width":700,"height":12}},{"id":"0ab3f91b-00c6-488b-8529-23a5b7aea2fe","block_type":"box","text":"sometimes referred to as revenue-sharing payments.","page_number":52,"box":{"x":116,"y":258,"width":399,"height":12}},{"id":"d02f7ad6-a04c-4022-8d37-7c7e285f50f0","block_type":"box","text":"Payments to an Intermediary may be significant to the Intermediary, and amounts that Intermediaries","page_number":52,"box":{"x":117,"y":289,"width":754,"height":12}},{"id":"10ce4175-08e2-4131-80ec-424187791d13","block_type":"box","text":"pay to your salesperson or other investment professional may also be significant for your salesperson","page_number":52,"box":{"x":117,"y":304,"width":759,"height":12}},{"id":"f622775d-b76f-4d1e-b4bf-c6cc97685678","block_type":"box","text":"or other investment professional. Because an Intermediary may make decisions about which","page_number":52,"box":{"x":116,"y":320,"width":692,"height":12}},{"id":"dde68238-a557-4b53-8c83-92e99f421b76","block_type":"box","text":"investment options it will recommend or make available to its clients, what services to provide for","page_number":52,"box":{"x":117,"y":335,"width":722,"height":12}},{"id":"b92cab60-5247-4f38-96c1-a1e4f2026679","block_type":"box","text":"various products or what marketing content to make available to its clients based on payments it","page_number":52,"box":{"x":116,"y":351,"width":719,"height":12}},{"id":"df1d9754-3f6e-4cd4-b9e9-65e053d3d08a","block_type":"box","text":"receives or is eligible to receive, such payments may create conflicts of interest between the","page_number":52,"box":{"x":117,"y":366,"width":688,"height":12}},{"id":"432867e9-5a62-46e8-8bf4-a6fcb1a8f71d","block_type":"box","text":"Intermediary and its clients. These financial incentives may cause the Intermediary to recommend the","page_number":52,"box":{"x":117,"y":382,"width":759,"height":12}},{"id":"8a4838db-38dc-43f9-ac6b-52443050cb0e","block_type":"box","text":"Fund or other Products or otherwise promote the Fund or other Products over other investments. The","page_number":52,"box":{"x":117,"y":397,"width":757,"height":12}},{"id":"8123eda8-8d45-4a34-a8ac-4314fa467ec4","block_type":"box","text":"same conflicts of interest and financial incentives exist with respect to your salesperson or other","page_number":52,"box":{"x":116,"y":413,"width":716,"height":12}},{"id":"06e30d13-42f0-48c2-92f4-b6a8d731f44f","block_type":"box","text":"investment professional if he or she receives similar payments from his or her Intermediary firm.","page_number":52,"box":{"x":117,"y":428,"width":716,"height":12}},{"id":"4bc033ad-42dc-49df-9ef6-380a491f611c","block_type":"box","text":"In addition to the payments described above, BFA Entities have developed proprietary tools,","page_number":52,"box":{"x":117,"y":459,"width":689,"height":12}},{"id":"2c465cba-bd93-4007-823e-e7cf0d6ff775","block_type":"box","text":"calculators and related interactive or digital content that is made available through the","page_number":52,"box":{"x":116,"y":475,"width":641,"height":12}},{"id":"56a0d3a9-bac6-44ef-977e-e094a3ca5826","block_type":"box","text":"www.blackrock.com website at no additional cost to Intermediaries. BlackRock may configure these","page_number":52,"box":{"x":116,"y":490,"width":744,"height":12}},{"id":"86e377a2-30ae-4cf1-81b5-3b16f568e56f","block_type":"box","text":"tools and calculators and localize the content for Intermediaries as part of its customary digital","page_number":52,"box":{"x":116,"y":506,"width":703,"height":12}},{"id":"b559d5f5-4fe7-4e6b-9f5b-67ad632f9a3a","block_type":"box","text":"marketing support and promotion of the Fund or other Products.","page_number":52,"box":{"x":117,"y":521,"width":479,"height":12}},{"id":"8f0e61f1-655a-426d-989b-4b671cd7994e","block_type":"box","text":"As of March 1, 2013, BFA Entities have contractual arrangements to make payments (in addition to","page_number":52,"box":{"x":116,"y":552,"width":742,"height":12}},{"id":"b1cbacb2-6ddd-4c67-a95c-3e9cfb93cd10","block_type":"box","text":"payments for Education Costs or Publishing Costs) to one Intermediary, Fidelity Brokerage Services","page_number":52,"box":{"x":117,"y":568,"width":747,"height":12}},{"id":"93c68279-05ff-4283-b6bd-50a3648b49b5","block_type":"box","text":"LLC (“FBS”). Effective June 4, 2016, this relationship was expanded to include National Financial","page_number":52,"box":{"x":117,"y":583,"width":725,"height":12}},{"id":"ab7fcbe6-c4b6-473a-97e4-a51fa5385398","block_type":"box","text":"Services, LLC (“NFS”), an affiliate of FBS. Pursuant to this special, long-term and significant","page_number":52,"box":{"x":116,"y":599,"width":688,"height":12}},{"id":"53032539-3efa-45d5-80c6-76a6db5ae0f0","block_type":"box","text":"arrangement (the “Marketing Program”), FBS, NFS and certain of their affiliates (collectively “Fidelity”)","page_number":52,"box":{"x":116,"y":614,"width":761,"height":12}},{"id":"a4bf38a5-3a1a-40f2-be8e-ed9250b4d6f9","block_type":"box","text":"have agreed, among other things, to actively promote certain funds and Products to customers,","page_number":52,"box":{"x":117,"y":630,"width":712,"height":12}},{"id":"de3982fd-875e-4174-ae7c-4bf2a5ac632d","block_type":"box","text":"investment professionals and other intermediaries and in advertising campaigns as the preferred","page_number":52,"box":{"x":117,"y":645,"width":721,"height":12}},{"id":"dc6a6bf4-db26-4ffb-a019-479a8acb1dba","block_type":"box","text":"exchange-traded product, to offer certain funds and Products in certain Fidelity platforms and","page_number":52,"box":{"x":116,"y":661,"width":690,"height":12}},{"id":"d8c9b189-ee03-46d0-a7e3-1f733e41af4f","block_type":"box","text":"investment programs, in some cases at a waived or reduced commission rate or ticket charge, and to","page_number":52,"box":{"x":117,"y":676,"width":751,"height":12}},{"id":"acdd4f65-86ec-41bf-897e-3c9bab23b088","block_type":"box","text":"provide marketing data to BFA Entities. BFA Entities have agreed to facilitate the Marketing Program","page_number":52,"box":{"x":117,"y":692,"width":746,"height":12}},{"id":"a4858db3-613c-458d-8aa9-ded497af3206","block_type":"box","text":"by, among other things, making certain payments to FBS and NFS for marketing and implementing","page_number":52,"box":{"x":117,"y":707,"width":733,"height":12}},{"id":"cfe04025-8f02-4bf9-b000-86b5a6defbf7","block_type":"box","text":"certain brokerage and investment programs. Upon termination of the arrangement, the BFA Entities","page_number":52,"box":{"x":116,"y":723,"width":739,"height":12}},{"id":"109d75a6-14df-4e79-9c0f-3ade9d790258","block_type":"box","text":"will make additional payments to FBS and/or NFS based upon a number of criteria, including the","page_number":52,"box":{"x":116,"y":738,"width":716,"height":12}},{"id":"238b7015-576b-469b-97a1-cabcab9c35f2","block_type":"box","text":"overall success of the Marketing Program and the level of services provided by FBS and NFS during","page_number":52,"box":{"x":116,"y":754,"width":745,"height":12}},{"id":"865c1cc5-7326-4520-afba-75b75e21ba58","block_type":"box","text":"the wind-down period.","page_number":52,"box":{"x":116,"y":769,"width":163,"height":12}},{"id":"06c7c36c-d74d-4e36-9061-3b7ff84bebe6","block_type":"box","text":"In addition, BFA Entities have entered into other contractual arrangements with Intermediaries and","page_number":52,"box":{"x":117,"y":800,"width":729,"height":12}},{"id":"1a346910-4e22-4285-bf8c-aba5a15dbbc6","block_type":"box","text":"certain other third parties that the BFA Entities believe may benefit the business of the BFA Entities or","page_number":52,"box":{"x":116,"y":816,"width":757,"height":12}},{"id":"c1e6297a-fbcd-4737-a0f7-f574ddc0ec7b","block_type":"box","text":"facilitate investment in the Fund or certain Products. Such agreements can include payments by BFA","page_number":52,"box":{"x":116,"y":831,"width":756,"height":12}},{"id":"b9c64584-1c3c-40b6-9ad5-56a15d8cd29f","block_type":"box","text":"Entities to such Intermediaries and third parties for data collection and provision, technology support,","page_number":52,"box":{"x":117,"y":847,"width":752,"height":12}},{"id":"9bc21d44-8f53-455d-a683-d543dc3804b3","block_type":"box","text":"platform enhancement, or educational content, co-marketing and cross-promotional efforts. In certain","page_number":52,"box":{"x":117,"y":862,"width":754,"height":12}},{"id":"8c0b5579-a077-4cb5-aec1-f2b51b28a60c","block_type":"box","text":"cases, such payments to Intermediaries are subject to certain minimum payment levels or tiered","page_number":52,"box":{"x":116,"y":878,"width":718,"height":12}},{"id":"351adefb-f389-4e95-bc11-ece51d56853d","block_type":"box","text":"47","page_number":52,"box":{"x":490,"y":909,"width":18,"height":9}},{"id":"e7f178b5-9255-4740-b3b5-c50b4a7efd10","block_type":"box","text":"NM0926U-5926888-52/257","page_number":52,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"4d5a5340-dd5b-4a91-a499-4396ffadcc64","block_type":"box","text":"payments. With respect to certain funds and Products, payments by the BFA Entities may take the","page_number":53,"box":{"x":117,"y":87,"width":734,"height":12}},{"id":"2b37a692-1996-4998-a66b-bc330704bb23","block_type":"box","text":"form of, among other things, “due diligence” payments for an Intermediary’s review of such funds and","page_number":53,"box":{"x":116,"y":102,"width":757,"height":13}},{"id":"e3d7dc60-4438-452b-a6a4-483b1fc480b5","block_type":"box","text":"Products; payment for providing employee training and information relating to such funds and","page_number":53,"box":{"x":117,"y":118,"width":697,"height":12}},{"id":"4b7e7c9a-d5ad-4707-b1d7-ac7543b084df","block_type":"box","text":"Products; fees for access (in some cases on a preferential basis) to an Intermediary’s registered","page_number":53,"box":{"x":117,"y":134,"width":719,"height":12}},{"id":"f9a62cba-0745-40c5-b7df-82e91ce437f9","block_type":"box","text":"representatives, salespersons or other personnel, fees for maintaining an Intermediary’s investor","page_number":53,"box":{"x":117,"y":149,"width":722,"height":12}},{"id":"682b68c8-ac5e-4835-a357-be82cc18c90f","block_type":"box","text":"platform, “shelf space” payments for making such funds and Products available on the Intermediary’s","page_number":53,"box":{"x":117,"y":165,"width":754,"height":12}},{"id":"3e936857-fbc1-44da-a154-86f4aba17724","block_type":"box","text":"platform or fees for providing assistance in promoting the sale of such funds and Products. In such","page_number":53,"box":{"x":117,"y":180,"width":735,"height":12}},{"id":"c7dfc2a0-2986-4d3d-b340-a0acd5dd2332","block_type":"box","text":"cases, the payments to Intermediaries may be tiered or based on a percentage of the value of the","page_number":53,"box":{"x":116,"y":196,"width":731,"height":12}},{"id":"3b7c781a-2fa9-48a3-849c-85fc4e985964","block_type":"box","text":"funds and Products held by customers of the applicable Intermediary and may also be subject to","page_number":53,"box":{"x":116,"y":211,"width":721,"height":12}},{"id":"2ca41218-d46c-4cba-8a8d-3d2ba7be8bf1","block_type":"box","text":"minimum payment levels. Payments made pursuant to such arrangements may vary in any year and","page_number":53,"box":{"x":117,"y":227,"width":750,"height":12}},{"id":"3601a3b3-ca57-4708-9b9f-273899c61c45","block_type":"box","text":"may be different for different Intermediaries and third parties and may reflect different services","page_number":53,"box":{"x":117,"y":242,"width":703,"height":12}},{"id":"6f66a52a-89e9-47a2-98f0-97a6d2b05bac","block_type":"box","text":"provided. As of the date of this SAI, the Intermediaries and other third parties (or their respective","page_number":53,"box":{"x":117,"y":258,"width":720,"height":12}},{"id":"a89f3092-713e-466a-b297-3ba70016120a","block_type":"box","text":"affiliates) receiving one or more types of the contractual payments described above include (in addition","page_number":53,"box":{"x":116,"y":273,"width":769,"height":12}},{"id":"532e21ee-ce7a-4acf-91c3-bcb34b9c9848","block_type":"box","text":"to FBS and NFS): & Partners, Advisor Credit Exchange, AE Wealth Management, LLC, American","page_number":53,"box":{"x":116,"y":289,"width":729,"height":12}},{"id":"df6e1751-1f0f-467c-ac53-21a86122c527","block_type":"box","text":"Enterprise Investment Services, Inc., Avantax Investment Services, Inc., BNY Mellon Capital Markets,","page_number":53,"box":{"x":117,"y":304,"width":761,"height":12}},{"id":"86dda06c-abeb-48de-98ca-3fea2f1f6b4d","block_type":"box","text":"LLC, BNY Mellon Performance & Risk Analytics, LLC, Cetera Financial Group, Inc., Charles Schwab &","page_number":53,"box":{"x":117,"y":320,"width":767,"height":12}},{"id":"1d19c0bf-9a3f-4819-a215-9b218e9d5814","block_type":"box","text":"Co., Inc., Clearstream Fund Centre AG, Commonwealth Equity Services, LLC, Dorsey Wright and","page_number":53,"box":{"x":117,"y":335,"width":730,"height":12}},{"id":"0ecc3165-52e6-4ff2-84b5-68eb1d9aad94","block_type":"box","text":"Associates, LLC, Dynasty Financial Partners LLC, E*Trade Securities LLC, Envestnet Asset","page_number":53,"box":{"x":116,"y":351,"width":688,"height":12}},{"id":"92c2fc00-5c2c-4518-9e3a-0ada82ddb450","block_type":"box","text":"Management, Inc., iCapital Markets LLC, Interactive Brokers LLC, LPL Financial LLC, Merrill Lynch,","page_number":53,"box":{"x":117,"y":366,"width":745,"height":12}},{"id":"942a8a38-0747-49a4-bd5f-0a7ebce3c217","block_type":"box","text":"Pierce, Fenner & Smith Incorporated, MML Investors Services, LLC, Morgan Stanley Smith Barney","page_number":53,"box":{"x":117,"y":382,"width":739,"height":12}},{"id":"14211d35-c4bc-4fd4-84d5-0a85abf13631","block_type":"box","text":"LLC, Northwestern Mutual Investment Services, LLC, Orion Portfolio Solutions, LLC, Pershing LLC,","page_number":53,"box":{"x":117,"y":397,"width":743,"height":12}},{"id":"e343a19b-143a-4cb0-ba5c-87ba7578954f","block_type":"box","text":"Raymond James Financial Services, Inc., Riskalyze, Inc., Rockefeller Financial LLC, Sanctuary Wealth","page_number":53,"box":{"x":117,"y":413,"width":768,"height":12}},{"id":"44b70122-a247-4e1e-b820-89ee15d5db7a","block_type":"box","text":"Group, LLC, UBS Financial Services Inc., Wells Fargo Clearing Services, LLC and Wells Fargo","page_number":53,"box":{"x":117,"y":428,"width":710,"height":12}},{"id":"77ec0219-b1b9-4edd-a110-7d2a8520c7e9","block_type":"box","text":"Advisors Financial Network, LLC. Any additions, modifications, or deletions to Intermediaries and other","page_number":53,"box":{"x":116,"y":444,"width":768,"height":12}},{"id":"041ec964-7358-4130-afb7-14dfc585285a","block_type":"box","text":"third parties listed above that have occurred since the date of this SAI are not included in the list.","page_number":53,"box":{"x":116,"y":459,"width":722,"height":12}},{"id":"11460b27-5cc7-4110-92a4-337f16eab9ba","block_type":"box","text":"Further, BFA Entities make Education Costs and Publishing Costs payments to other Intermediaries","page_number":53,"box":{"x":117,"y":490,"width":746,"height":12}},{"id":"08a9361f-068b-47f4-b890-1541e1a50588","block_type":"box","text":"that are not listed in the immediately preceding paragraph. BFA Entities may determine to make such","page_number":53,"box":{"x":116,"y":506,"width":757,"height":12}},{"id":"b90f9446-e572-4424-8144-8f01d0a04b5b","block_type":"box","text":"payments based on any number of metrics. For example, BFA Entities may make payments at","page_number":53,"box":{"x":117,"y":521,"width":705,"height":12}},{"id":"c33c1a3a-0b42-4efa-9ba2-467bd3cb82e1","block_type":"box","text":"year-end or other intervals in a fixed amount, an amount based upon an Intermediary’s services at","page_number":53,"box":{"x":116,"y":537,"width":734,"height":12}},{"id":"d117a0c9-a7ba-4b85-90b9-f93d2dc632c9","block_type":"box","text":"defined levels or an amount based on the Intermediary’s net sales of one or more Products, including","page_number":53,"box":{"x":116,"y":552,"width":757,"height":12}},{"id":"a640c70e-6533-4499-8da5-72379484cec4","block_type":"box","text":"the Fund, in a year or other period, any of which arrangements may include an agreed-upon minimum","page_number":53,"box":{"x":116,"y":568,"width":761,"height":12}},{"id":"a3d41f97-9823-48f8-a1e4-69dde32f34e6","block_type":"box","text":"or maximum payment, or any combination of the foregoing.","page_number":53,"box":{"x":116,"y":583,"width":444,"height":12}},{"id":"09d8b729-8d1a-48de-8d4a-ba8e8c31600b","block_type":"box","text":"Please contact your salesperson or","page_number":53,"box":{"x":562,"y":583,"width":282,"height":12}},{"id":"6036f602-adcb-43a4-8b98-792246762d6f","block_type":"box","text":"other investment professional for more information regarding any such payments or financial","page_number":53,"box":{"x":116,"y":599,"width":753,"height":12}},{"id":"3619127a-555d-493b-91a3-967d42facd37","block_type":"box","text":"incentives his or her Intermediary firm may receive","page_number":53,"box":{"x":117,"y":614,"width":405,"height":12}},{"id":"92e9c945-dc5f-4218-9dc2-f59973d46674","block_type":"box","text":".","page_number":53,"box":{"x":524,"y":622,"width":8,"height":2}},{"id":"388f7527-28c0-4c8f-81df-d740ce7b6a59","block_type":"box","text":"Any payments made, or financial incentives","page_number":53,"box":{"x":532,"y":614,"width":355,"height":12}},{"id":"e7ba6485-90c5-4d70-8bc8-30a8ea346f13","block_type":"box","text":"offered, by the BFA Entities to an Intermediary may create the incentive for the Intermediary to","page_number":53,"box":{"x":116,"y":630,"width":760,"height":12}},{"id":"1877434b-0655-47d3-9247-d47d9721c5b9","block_type":"box","text":"encourage customers to buy shares of the Fund or other Products.","page_number":53,"box":{"x":116,"y":645,"width":535,"height":12}},{"id":"7b7288a7-dbc3-4b05-8fac-3ab7c99e2cc2","block_type":"box","text":"The Fund may participate in certain market maker incentive programs of a national securities","page_number":53,"box":{"x":116,"y":676,"width":690,"height":12}},{"id":"79d9392d-fa80-4bc2-a43f-6c85e488aff4","block_type":"box","text":"exchange in which an affiliate of the Fund would pay a fee to the exchange used for the purpose of","page_number":53,"box":{"x":116,"y":692,"width":735,"height":12}},{"id":"991ae1d7-ed42-4de0-8cae-cee77418127a","block_type":"box","text":"incentivizing one or more market makers in the securities of the Fund to enhance the liquidity and","page_number":53,"box":{"x":117,"y":707,"width":722,"height":12}},{"id":"ae858399-8df2-4701-925d-70a015b35f24","block_type":"box","text":"quality of the secondary market of securities of the Fund. The fee would then be credited by the","page_number":53,"box":{"x":116,"y":723,"width":709,"height":12}},{"id":"4ab9b8b2-ecde-4f76-b8db-8c7218cf492c","block_type":"box","text":"exchange to one or more market makers that meet or exceed liquidity and market quality standards","page_number":53,"box":{"x":116,"y":738,"width":738,"height":12}},{"id":"a5df667c-efae-4a99-81cd-7a88f73d28c8","block_type":"box","text":"with respect to the securities of the Fund. Each market maker incentive program is subject to approval","page_number":53,"box":{"x":116,"y":754,"width":758,"height":12}},{"id":"6142261c-d07b-46ef-a5ba-c9a16e7ea2d5","block_type":"box","text":"from the SEC. Any such fee payments made to an exchange will be made by an affiliate of the Fund","page_number":53,"box":{"x":116,"y":769,"width":743,"height":12}},{"id":"23750954-a669-4017-8489-ce68a38e5439","block_type":"box","text":"solely for the benefit of the Fund and will not","page_number":53,"box":{"x":116,"y":785,"width":329,"height":12}},{"id":"ecd9bed2-0a4d-4b12-a50a-a7372c170722","block_type":"box","text":"be paid from any Fund assets. Other funds managed by","page_number":53,"box":{"x":451,"y":785,"width":415,"height":12}},{"id":"9b01306e-a182-44cd-b2a3-37933fd7f855","block_type":"box","text":"BFA may also participate in such programs.","page_number":53,"box":{"x":117,"y":800,"width":323,"height":12}},{"id":"8a3e154b-921d-4f71-8887-c18e7bc29f28","block_type":"box","text":"48","page_number":53,"box":{"x":490,"y":909,"width":18,"height":9}},{"id":"9d58c02d-5935-41fe-8336-a81152a11d30","block_type":"box","text":"NM0926U-5926888-53/257","page_number":53,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"3b389531-5970-4c5e-aafe-81acd7d31c11","block_type":"box","text":"Determination of Net Asset Value","page_number":54,"box":{"x":119,"y":92,"width":605,"height":23}},{"id":"8ea7960d-62e3-4fbd-a25e-46462934668f","block_type":"box","text":"Valuation of Shares.","page_number":54,"box":{"x":116,"y":140,"width":160,"height":10}},{"id":"fbb6906d-1970-4fca-8f4c-972e6c92831d","block_type":"box","text":"The NAV for the Fund is generally calculated as of the close of regular trading","page_number":54,"box":{"x":278,"y":140,"width":588,"height":12}},{"id":"822981f3-b7f0-4a3a-b8a2-7ceb558549e8","block_type":"box","text":"hours on the New York Stock Exchange (“NYSE”) (normally 4:00 p.m., Eastern time) on each business","page_number":54,"box":{"x":117,"y":156,"width":768,"height":12}},{"id":"647d05fd-04a6-4f00-b146-27f6f582f23b","block_type":"box","text":"day the NYSE is open. 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The pricing services may use","page_number":54,"box":{"x":468,"y":415,"width":363,"height":12}},{"id":"ef7dbed5-632f-4d2c-a3ed-16715196d45b","block_type":"box","text":"valuation models that utilize certain inputs and assu","page_number":54,"box":{"x":116,"y":430,"width":374,"height":12}},{"id":"e0d488c8-f21e-4c9c-8442-e5fe00591ecb","block_type":"box","text":"mptions to derive values, including transaction data","page_number":54,"box":{"x":492,"y":430,"width":377,"height":12}},{"id":"539b015c-59f8-455c-a493-e18a7f44647e","block_type":"box","text":"(","page_number":54,"box":{"x":117,"y":446,"width":4,"height":12}},{"id":"e2c47a5c-40eb-48fa-b6af-56c4a7b53873","block_type":"box","text":"e.g.","page_number":54,"box":{"x":122,"y":448,"width":25,"height":10}},{"id":"245032b8-798b-45a3-aeae-5766609da705","block_type":"box","text":", recent representative bids and offers), credit","page_number":54,"box":{"x":150,"y":446,"width":334,"height":12}},{"id":"3cb5d09e-bc41-4a43-965b-dfdc2756ff7b","block_type":"box","text":"quality information, perceived market movements,","page_number":54,"box":{"x":485,"y":446,"width":367,"height":12}},{"id":"806f29d4-ec46-48ce-9265-506d265ac7da","block_type":"box","text":"news, and other relevant information and by other met","page_number":54,"box":{"x":117,"y":461,"width":393,"height":12}},{"id":"e7c60536-c039-41c0-b4ba-b392f89aae9d","block_type":"box","text":"hods, which may include consideration of: yields or","page_number":54,"box":{"x":511,"y":461,"width":374,"height":12}},{"id":"a6031b47-a622-4796-a804-b8abc90aab3c","block_type":"box","text":"prices of securities of comparable quality, coupon,","page_number":54,"box":{"x":117,"y":477,"width":368,"height":12}},{"id":"8cf7cb9f-3442-4c42-9fe9-5a3650b754f4","block_type":"box","text":"maturity and type; indications as to values from","page_number":54,"box":{"x":486,"y":477,"width":347,"height":12}},{"id":"32cc190d-0b21-4fbd-8bbb-c3934b67352b","block_type":"box","text":"dealers; general market conditions; and/or other fa","page_number":54,"box":{"x":116,"y":492,"width":367,"height":12}},{"id":"4d687353-4156-451f-abec-ca606a8109e8","block_type":"box","text":"ctors and assumptions. Pricing services generally","page_number":54,"box":{"x":484,"y":492,"width":364,"height":12}},{"id":"3d3ee3d7-2ee4-4329-8eb4-8a69df526b9a","block_type":"box","text":"value fixed-income securities assuming orderly trans","page_number":54,"box":{"x":116,"y":508,"width":381,"height":12}},{"id":"c5359684-7733-43b8-a673-2f7ed2304444","block_type":"box","text":"actions of an institutional round lot size, but the Fund","page_number":54,"box":{"x":499,"y":508,"width":387,"height":11}},{"id":"e6726f9d-7c33-4b0f-9540-b83a7dc6bd71","block_type":"box","text":"may hold or transact in such securities in smaller, odd","page_number":54,"box":{"x":117,"y":523,"width":395,"height":12}},{"id":"182d60ae-6d72-493b-b9b6-88e382745212","block_type":"box","text":"lot sizes. Odd lots of securities in certain asset","page_number":54,"box":{"x":513,"y":523,"width":340,"height":10}},{"id":"134a717f-6d93-456d-a4c3-92b7a6ff6584","block_type":"box","text":"classes may trade at lower prices than institutional","page_number":54,"box":{"x":116,"y":539,"width":371,"height":12}},{"id":"df294c39-3763-40a4-9f68-a6e1f6266956","block_type":"box","text":"round lots, and the value ultimately realized when the","page_number":54,"box":{"x":488,"y":539,"width":391,"height":12}},{"id":"cffb0c96-65bb-4dcd-b616-f1cf1b73e039","block_type":"box","text":"securities are sold could differ from the prices us","page_number":54,"box":{"x":116,"y":554,"width":352,"height":12}},{"id":"6f143b52-a398-4daa-8c74-ad099f855063","block_type":"box","text":"ed by the Fund. The amortized cost method of valuation","page_number":54,"box":{"x":469,"y":554,"width":412,"height":12}},{"id":"cb739b56-c810-4759-8394-aa5c94a21dab","block_type":"box","text":"may be used with respect to debt obligations with 60","page_number":54,"box":{"x":117,"y":570,"width":385,"height":12}},{"id":"10390f61-4d02-4df3-a7b8-8a7ea5bed8e5","block_type":"box","text":"days or less remaining to maturity unless such","page_number":54,"box":{"x":502,"y":570,"width":342,"height":12}},{"id":"684008c6-30e1-4190-9f07-4910a24d0110","block_type":"box","text":"method does not represent fair value. Certain fi","page_number":54,"box":{"x":117,"y":585,"width":341,"height":12}},{"id":"b8f3b49e-74c0-43d2-b112-794658e21352","block_type":"box","text":"xed-income investments, including asset-backed and","page_number":54,"box":{"x":459,"y":585,"width":391,"height":12}},{"id":"1078d164-0bc6-42cf-bb78-7bc8077abac6","block_type":"box","text":"mortgage-related securities, may be valued based on val","page_number":54,"box":{"x":117,"y":601,"width":411,"height":12}},{"id":"6496e387-265d-4274-b2eb-c1a43f16fc40","block_type":"box","text":"uation models that consider the estimated cash","page_number":54,"box":{"x":530,"y":601,"width":348,"height":9}},{"id":"55de15b5-8f59-4f1e-ab49-c66a9c77aa14","block_type":"box","text":"flows of each tranche of the issuer, establis","page_number":54,"box":{"x":116,"y":616,"width":314,"height":12}},{"id":"5eba905e-e759-48f0-9afb-3e286c336401","block_type":"box","text":"h a benchmark yield and develop an estimated tranche","page_number":54,"box":{"x":431,"y":616,"width":404,"height":12}},{"id":"8f7f2f0d-d0bc-465f-84aa-68d311612fc4","block_type":"box","text":"specific spread to the benchmark yield bas","page_number":54,"box":{"x":116,"y":632,"width":310,"height":12}},{"id":"0e16f8f3-92f1-47d2-8ef9-f22818159fb3","block_type":"box","text":"ed on the unique attributes of the tranche.","page_number":54,"box":{"x":427,"y":632,"width":309,"height":12}},{"id":"283531da-0f0b-4d7c-a21e-b6cf1f92913c","block_type":"box","text":"Options, Futures, Swaps and Other Derivatives.","page_number":54,"box":{"x":116,"y":661,"width":379,"height":11}},{"id":"8d48646b-b6d2-4fa8-b295-bc8edc16e42b","block_type":"box","text":"Exchange-traded equity options (except ETF","page_number":54,"box":{"x":503,"y":661,"width":331,"height":12}},{"id":"d5c3d92e-f1a5-4eab-95b4-5fa021c19853","block_type":"box","text":"options, equity index options or those that are customized) for which market quotations are readily","page_number":54,"box":{"x":116,"y":676,"width":729,"height":12}},{"id":"5fe614b3-d1b7-4eec-a2d3-f5fa15c9dc58","block_type":"box","text":"available are valued at the mean of the last bid and ask prices as quoted on the Exchange or the board","page_number":54,"box":{"x":116,"y":692,"width":765,"height":12}},{"id":"5595025f-ab12-41a3-a6fb-83f17070f66c","block_type":"box","text":"of trade on which such options are traded. In the event that there is no mean price available for an","page_number":54,"box":{"x":116,"y":707,"width":728,"height":12}},{"id":"f01b02c3-78f8-43f6-8a01-752ac345c43b","block_type":"box","text":"exchange-traded equity option held by the Fund on a day on which the Fund values such option, the","page_number":54,"box":{"x":116,"y":723,"width":744,"height":12}},{"id":"158594d6-f906-473b-a14f-a328b58b7f84","block_type":"box","text":"last bid (long positions) or ask (short positions) price, if available, will be used as the value of such","page_number":54,"box":{"x":117,"y":738,"width":726,"height":12}},{"id":"9f401608-c331-4b5f-8365-0fbe479f541f","block_type":"box","text":"option. If no bid or ask price is available on a day on which the Fund values such option, the prior day’s","page_number":54,"box":{"x":116,"y":754,"width":764,"height":12}},{"id":"9f1fa2af-295d-4ed8-8d64-2b881a32bcf6","block_type":"box","text":"price will be used, unless BFA determines that such prior day’s price no longer reflects the fair value of","page_number":54,"box":{"x":117,"y":769,"width":762,"height":12}},{"id":"c95181c6-668f-41dc-8bd5-319970c71e5e","block_type":"box","text":"the option, in which case such option will be treated as a Fair Value Asset. Customized exchange","page_number":54,"box":{"x":116,"y":785,"width":729,"height":12}},{"id":"c7f0e416-963d-49aa-b791-55eb09b81bd2","block_type":"box","text":"traded equity options, ETF options, equity index options and OTC derivatives may be valued using a","page_number":54,"box":{"x":116,"y":800,"width":745,"height":12}},{"id":"da3f169b-6c92-46f0-96ac-0cedb84cfddb","block_type":"box","text":"mathematical model which may incorporate a number of market data factors. Financial futures","page_number":54,"box":{"x":117,"y":816,"width":698,"height":12}},{"id":"ea908705-65a6-417d-9c80-7741463e77e3","block_type":"box","text":"contracts and options thereon, which are traded on exchanges, are valued at their last sale price or","page_number":54,"box":{"x":116,"y":831,"width":741,"height":12}},{"id":"29b6cce1-a18c-414a-9fb9-c2aad35c0476","block_type":"box","text":"settle price as of the close of such exchanges. Swap agreements and other derivatives are generally","page_number":54,"box":{"x":116,"y":847,"width":752,"height":12}},{"id":"77cfde91-a06f-48f1-b337-35a13ac88ca1","block_type":"box","text":"valued daily based upon quotations from market makers or by a pricing service in accordance with the","page_number":54,"box":{"x":116,"y":862,"width":763,"height":12}},{"id":"1db5aadc-9f4d-459a-8f65-fe5b24185411","block_type":"box","text":"Valuation Procedures.","page_number":54,"box":{"x":116,"y":878,"width":170,"height":9}},{"id":"be7bafc2-f02a-4a6e-9787-ffba9827345f","block_type":"box","text":"49","page_number":54,"box":{"x":490,"y":909,"width":18,"height":9}},{"id":"2943689f-498d-4a3f-bb7d-4ce8272b3973","block_type":"box","text":"NM0926U-5926888-54/257","page_number":54,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"11c63dd8-9fa5-4b1e-aa6a-cb39d8ade0fd","block_type":"box","text":"Underlying Funds.","page_number":55,"box":{"x":117,"y":87,"width":145,"height":12}},{"id":"1c309e25-7cbe-463b-a854-735846ddf758","block_type":"box","text":"Shares of underlying open-end funds (including money market funds) are valued","page_number":55,"box":{"x":263,"y":87,"width":609,"height":12}},{"id":"5ceb2c69-615c-4801-b1ce-cd9bceed44d5","block_type":"box","text":"at NAV. Shares of underlying exchange-traded closed-end funds or other ETFs will be valued at their","page_number":55,"box":{"x":116,"y":102,"width":755,"height":13}},{"id":"5de9f4b0-914b-4ecc-becc-521ebe688e7d","block_type":"box","text":"most recent closing price.","page_number":55,"box":{"x":117,"y":118,"width":194,"height":12}},{"id":"0e79638a-267a-482c-89a6-2f86e2611d29","block_type":"box","text":"General Valuation Information.","page_number":55,"box":{"x":116,"y":149,"width":244,"height":10}},{"id":"42901741-4d08-4dbf-8e6a-16a6f3d6071c","block_type":"box","text":"Prices obtained from independent third-party pricing services, broker","page_number":55,"box":{"x":361,"y":149,"width":520,"height":12}},{"id":"722c1a70-5101-4434-be2b-a525ad3173fd","block_type":"box","text":"dealers or market makers to value the Fund’s securities and other assets and liabilities are based on","page_number":55,"box":{"x":116,"y":165,"width":751,"height":9}},{"id":"3cda22e4-d2ea-471f-a0bd-9eb7ec18a41c","block_type":"box","text":"information available at the time the Fund values its assets and liabilities. In the event that a pricing","page_number":55,"box":{"x":117,"y":180,"width":740,"height":12}},{"id":"587c4c11-ab6f-4ca2-9af3-f8af1f23e7c8","block_type":"box","text":"service quotation is revised or updated subsequent to the day on which the Fund valued such security,","page_number":55,"box":{"x":116,"y":196,"width":767,"height":12}},{"id":"b8dff3d8-e55a-4d54-b5b2-45b59c07a05f","block_type":"box","text":"the revised pricing service quotation generally will be applied prospectively. Such determination will be","page_number":55,"box":{"x":116,"y":211,"width":764,"height":12}},{"id":"0aba1d55-352b-4b34-8a93-b6f2429f9eef","block_type":"box","text":"made considering pertinent facts and circumstances surrounding the revision.","page_number":55,"box":{"x":117,"y":227,"width":581,"height":12}},{"id":"5652010e-5132-4965-9673-dacf05b17946","block_type":"box","text":"The price the Fund could receive upon the sale of any particular portfolio investment may differ from","page_number":55,"box":{"x":116,"y":258,"width":747,"height":12}},{"id":"c9de20bc-2224-465f-bc8b-000930a38688","block_type":"box","text":"the Fund’s valuation of the investment, particularly for assets that trade in thin or volatile markets or","page_number":55,"box":{"x":116,"y":273,"width":743,"height":12}},{"id":"86cdf87e-5811-426f-85c5-a0b9cb1b7a08","block_type":"box","text":"that are valued using a fair valuation methodology or a price provided by an independent pricing","page_number":55,"box":{"x":116,"y":289,"width":717,"height":12}},{"id":"f3d9ee8d-ca6a-4ff6-a8dd-47346c4b0d96","block_type":"box","text":"service. As a result, the price received upon the sale of an investment may be less than the value","page_number":55,"box":{"x":116,"y":304,"width":728,"height":12}},{"id":"2a5bd2f9-6310-4037-bdc5-af2a4dbdccd3","block_type":"box","text":"ascribed by the Fund, and the Fund could realize a greater than expected loss or lesser than expected","page_number":55,"box":{"x":116,"y":320,"width":766,"height":12}},{"id":"50150c91-2720-4249-8d2d-da4d50432bd4","block_type":"box","text":"gain upon the sale of the investment. The Fund’s ability to value its investment may also be impacted","page_number":55,"box":{"x":116,"y":335,"width":756,"height":12}},{"id":"aac24b86-41b3-429c-afe4-3942385bdbdc","block_type":"box","text":"by technological issues and/or errors by pricing services or other third-party service providers.","page_number":55,"box":{"x":117,"y":351,"width":700,"height":12}},{"id":"3cb3a646-f9a4-412b-9410-d7c00c5cc994","block_type":"box","text":"In the event that application of the methods of valuation discussed above result in a price for a security","page_number":55,"box":{"x":117,"y":382,"width":766,"height":12}},{"id":"e9f0f6a0-64ad-455b-a116-32c12edb02d1","block_type":"box","text":"which is deemed not to be representative of the fair market value of such security, the security will be","page_number":55,"box":{"x":116,"y":397,"width":756,"height":12}},{"id":"e2596dde-1a74-4e2c-98e1-f1cfcab40bd8","block_type":"box","text":"valued by, under the direction of or in accordance with a method approved by BFA, the Fund’s","page_number":55,"box":{"x":116,"y":413,"width":705,"height":12}},{"id":"16584f82-2de4-46ce-b9f9-d50aecf51c92","block_type":"box","text":"valuation designee, as reflecting fair value. All other assets and liabilities (including securities for which","page_number":55,"box":{"x":116,"y":428,"width":767,"height":12}},{"id":"9a7a9b0f-9376-4fc8-b461-a0a8a2e767ab","block_type":"box","text":"market quotations are not readily available) held by the Fund (including restricted securities and private","page_number":55,"box":{"x":117,"y":444,"width":770,"height":12}},{"id":"f8527981-b850-416a-8b8f-26182fecf6b5","block_type":"box","text":"market investments, as applicable) are valued at fair value as determined in good faith by BFA","page_number":55,"box":{"x":117,"y":459,"width":705,"height":12}},{"id":"5c6fd70e-88c8-45d0-b548-177286d56f02","block_type":"box","text":"pursuant to the Valuation Procedures. Any assets and liabilities which are denominated in a foreign","page_number":55,"box":{"x":117,"y":475,"width":740,"height":12}},{"id":"3213e00a-c224-4ab0-92d2-d572155177a0","block_type":"box","text":"currency are translated into U.S. dollars at the prevailing market rates.","page_number":55,"box":{"x":116,"y":490,"width":527,"height":12}},{"id":"76fc181b-7088-438a-b1f4-1ef879f58d5e","block_type":"box","text":"Fair Value.","page_number":55,"box":{"x":117,"y":521,"width":83,"height":10}},{"id":"0d537881-736b-4e54-970f-c807d220992a","block_type":"box","text":"When market quotations are not readily available or are believed by BFA to be unreliable,","page_number":55,"box":{"x":201,"y":521,"width":674,"height":12}},{"id":"9c97e055-acec-4a92-9cb0-c5ebaa9ac50f","block_type":"box","text":"the Fund’s investments are valued at fair value (“Fair Value Assets”). Fair Value Assets are valued by","page_number":55,"box":{"x":116,"y":537,"width":758,"height":12}},{"id":"776b92de-d2e2-4f92-bfd4-d9bebef86c1a","block_type":"box","text":"BFA in accordance with the Valuation Procedures. Pursuant to Rule 2a-5 under the Investment","page_number":55,"box":{"x":117,"y":552,"width":710,"height":10}},{"id":"17c7b201-37db-451b-95fa-7450aef99fe8","block_type":"box","text":"Company Act, the Board has designated BFA as the valuation designee for the Fund. BFA may","page_number":55,"box":{"x":117,"y":568,"width":712,"height":12}},{"id":"a0080336-bdf0-4550-b415-43750dd1ab21","block_type":"box","text":"reasonably conclude that a market quotation is not readily available or is unreliable if, among other","page_number":55,"box":{"x":117,"y":583,"width":736,"height":12}},{"id":"469866f9-9e6c-469f-bd92-4e1ec1d6821b","block_type":"box","text":"things, a security or other asset or liability does not have a price source due to its complete lack of","page_number":55,"box":{"x":116,"y":599,"width":733,"height":12}},{"id":"386a058b-2a9f-4845-96c8-1a1e451f2a7e","block_type":"box","text":"trading, if BFA believes a market quotation from a broker-dealer or other source is unreliable (e.g.,","page_number":55,"box":{"x":116,"y":614,"width":734,"height":12}},{"id":"cef62554-cc1d-42fc-a698-d56e2b1144db","block_type":"box","text":"where it varies significantly from a recent trade, or no longer reflects the fair value of the security or","page_number":55,"box":{"x":116,"y":630,"width":740,"height":12}},{"id":"843e9fbf-2125-44ff-a368-8b7fe861924b","block_type":"box","text":"other asset or liability subsequent to the most recent market quotation), or where the security or other","page_number":55,"box":{"x":116,"y":645,"width":758,"height":12}},{"id":"9dc5c490-2808-45b3-abb0-7906779f8de1","block_type":"box","text":"asset or liability is only thinly traded or due to the occurrence of a significant event subsequent to the","page_number":55,"box":{"x":116,"y":661,"width":747,"height":12}},{"id":"9df7a5d3-8855-4397-888c-defa7649f719","block_type":"box","text":"most recent market quotation. For this purpose, a “significant event” is deemed to occur if BFA","page_number":55,"box":{"x":117,"y":676,"width":701,"height":12}},{"id":"833f4c18-ba89-4d60-bcdb-5d55ab128329","block_type":"box","text":"determines, in its reasonable business judgment, that an event has occurred after the close of trading","page_number":55,"box":{"x":116,"y":692,"width":753,"height":12}},{"id":"a993b6d7-1b77-4416-838d-159a278ea6cf","block_type":"box","text":"for an asset or liability but prior to or at the time of pricing the Fund’s assets or liabilities, is likely to","page_number":55,"box":{"x":116,"y":707,"width":730,"height":12}},{"id":"2daccde9-6731-434c-89a6-0f4d4f3f5675","block_type":"box","text":"cause a material change to the last exchange closing price or closing market price of one or more","page_number":55,"box":{"x":116,"y":723,"width":724,"height":12}},{"id":"ac5bedfb-6df1-4793-82a8-6d06671d1dc2","block_type":"box","text":"assets held by, or liabilities of, the Fund. On any day the NYSE is open and a foreign market or the","page_number":55,"box":{"x":116,"y":738,"width":734,"height":12}},{"id":"8b617a8d-1f75-470f-a384-3f7e313222bf","block_type":"box","text":"primary exchange on which a foreign asset or liability is traded is closed, such asset or liability will be","page_number":55,"box":{"x":117,"y":754,"width":748,"height":12}},{"id":"490510e4-daeb-4849-b827-90215bd96431","block_type":"box","text":"valued using the prior day’s price, provided that BFA is not aware of any significant event or other","page_number":55,"box":{"x":116,"y":769,"width":724,"height":12}},{"id":"c5f41e1b-69bb-4025-83a8-32ff1ed39de2","block_type":"box","text":"information that would cause such price to no longer reflect the fair value of the asset or liability, in","page_number":55,"box":{"x":117,"y":785,"width":728,"height":12}},{"id":"0c71d717-ca65-4c50-961c-8cda7065a657","block_type":"box","text":"which case such asset or liability would be treated as a Fair Value Asset. For certain foreign assets, a","page_number":55,"box":{"x":116,"y":800,"width":754,"height":12}},{"id":"b4d77616-96ce-487d-b9ba-90346d2bd879","block_type":"box","text":"third-party vendor supplies evaluated, systematic fair value pricing based upon the movement of a","page_number":55,"box":{"x":116,"y":816,"width":728,"height":12}},{"id":"5a3624cb-54e1-4cbc-8bcf-e769826c1137","block_type":"box","text":"proprietary multi-factor model after the relevant foreign markets have closed. This systematic fair value","page_number":55,"box":{"x":117,"y":831,"width":767,"height":12}},{"id":"fd4f2374-a176-4f20-a252-e20689cfb485","block_type":"box","text":"pricing methodology is designed to correlate the prices of foreign assets in one or more non-U.S.","page_number":55,"box":{"x":117,"y":847,"width":723,"height":12}},{"id":"67e87763-effa-410b-a484-dadfc4e96951","block_type":"box","text":"markets following the close of the local markets to the prices that might have prevailed as of the Fund’s","page_number":55,"box":{"x":117,"y":862,"width":770,"height":12}},{"id":"afccdd20-5871-478c-a688-840d37211460","block_type":"box","text":"pricing time.","page_number":55,"box":{"x":117,"y":878,"width":94,"height":12}},{"id":"cb349196-7388-42a8-9a63-acfc044b463a","block_type":"box","text":"50","page_number":55,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"e1d8b309-c917-48aa-b7d1-cd8fad5ab047","block_type":"box","text":"NM0926U-5926888-55/257","page_number":55,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"9079ff8a-53e4-4902-af41-a138a0d28ef5","block_type":"box","text":"BFA’s Rule 2a-5 Committee is responsible for reviewing and approving methodologies by investment","page_number":56,"box":{"x":117,"y":87,"width":753,"height":12}},{"id":"175ef87d-d362-414f-8a72-f15249d7cf7a","block_type":"box","text":"type and significant inputs used in the fair valuation of Fund assets or liabilities. In addition, the Fund’s","page_number":56,"box":{"x":116,"y":102,"width":763,"height":13}},{"id":"edf960c6-ac39-4305-89ce-bc8322e6d6aa","block_type":"box","text":"accounting agent assists BFA by periodically endeavoring to confirm the prices it receives from all","page_number":56,"box":{"x":116,"y":118,"width":731,"height":12}},{"id":"c1bd113c-01d3-44b8-9800-0b63c997d5ac","block_type":"box","text":"third-party pricing services, index providers and broker-dealers, BFA regularly evaluates the values","page_number":56,"box":{"x":116,"y":134,"width":740,"height":12}},{"id":"94495229-9700-4fcc-a89e-7cccd0c6c2fa","block_type":"box","text":"assigned to the securities and other assets and liabilities of the Fund.","page_number":56,"box":{"x":116,"y":149,"width":519,"height":12}},{"id":"fe44240e-4e5a-4194-9d64-3062973d181a","block_type":"box","text":"When determining the price for a Fair Value Asset, BFA will seek to determine the price that the Fund","page_number":56,"box":{"x":116,"y":180,"width":759,"height":12}},{"id":"621bf5d8-b27e-4f70-a683-85ffcaf2f336","block_type":"box","text":"might reasonably expect to receive from the current sale of that asset or liability in an arm’s-length","page_number":56,"box":{"x":117,"y":196,"width":732,"height":12}},{"id":"59d082a3-f443-4a67-a8ec-4281f036e2da","block_type":"box","text":"transaction on the date on which the asset or liability is being valued, and does not seek to determine","page_number":56,"box":{"x":116,"y":211,"width":757,"height":12}},{"id":"0d76fa96-9efc-4f61-890e-5d75c92a1e1c","block_type":"box","text":"the price the Fund might reasonably expect to receive for selling an asset or liability at a later time or if","page_number":56,"box":{"x":116,"y":227,"width":764,"height":12}},{"id":"f3dc38df-628d-4afe-bec8-4c257e6930e9","block_type":"box","text":"it holds the asset or liability to maturity. Fair value determinations will be based upon all available","page_number":56,"box":{"x":117,"y":242,"width":723,"height":12}},{"id":"d40bdbba-f73a-4757-904c-3baff6a8d03a","block_type":"box","text":"factors that BFA deems relevant at the time of the determination, and may be based on analytical","page_number":56,"box":{"x":116,"y":258,"width":728,"height":12}},{"id":"f6f93fcd-6c53-441e-9426-e82b1412aa12","block_type":"box","text":"values determined by BFA using proprietary or third-party valuation models.","page_number":56,"box":{"x":116,"y":273,"width":568,"height":12}},{"id":"621e1410-4d3f-4f26-acf7-e182ba8b9955","block_type":"box","text":"Fair value represents a good faith approximation of the value of an asset or liability. When determining","page_number":56,"box":{"x":117,"y":304,"width":764,"height":12}},{"id":"0455ba0b-f3a4-4741-8388-4e390d37d817","block_type":"box","text":"the fair value of an investment, one or more fair value methodologies may be used (depending on","page_number":56,"box":{"x":116,"y":320,"width":730,"height":12}},{"id":"10cf4cbf-8969-4105-a31c-5b907e741b1a","block_type":"box","text":"certain factors, including the asset type). For example, the investment may be initially priced based on","page_number":56,"box":{"x":116,"y":335,"width":762,"height":12}},{"id":"ff2842ee-66b8-4bef-8a86-d6d9f0da9c2c","block_type":"box","text":"the original cost of the investment or, alternatively, using proprietary or third-party models that may rely","page_number":56,"box":{"x":116,"y":351,"width":769,"height":12}},{"id":"f491bfa4-86b5-4f7e-9dbe-9d524c4655a5","block_type":"box","text":"upon one or more unobservable inputs. Prices of actual, executed or historical transactions in the","page_number":56,"box":{"x":117,"y":366,"width":726,"height":12}},{"id":"ecfd39b6-ab05-4a94-93c4-ee34b6b14814","block_type":"box","text":"relevant investment (or comparable instruments) or, where appropriate, an appraisal by a third-party","page_number":56,"box":{"x":117,"y":382,"width":747,"height":12}},{"id":"ba0aaadd-f721-4e61-b7ef-15886e82a948","block_type":"box","text":"experienced in the valuation of similar instruments, may also be used as a basis for establishing the","page_number":56,"box":{"x":116,"y":397,"width":745,"height":12}},{"id":"d2a92eeb-4ff8-4afe-a967-794dc3ba6642","block_type":"box","text":"fair value of an investment.","page_number":56,"box":{"x":116,"y":413,"width":206,"height":9}},{"id":"eb386182-9a9e-4aa5-a6d9-d5ba02d56970","block_type":"box","text":"The fair value of one or more assets or liabilities may not, in retrospect, be the price at which those","page_number":56,"box":{"x":116,"y":444,"width":738,"height":12}},{"id":"6deafa9e-6b3a-47b1-af19-39b1ce82d769","block_type":"box","text":"assets or liabilities could have been sold during the period in which the particular fair values were used","page_number":56,"box":{"x":116,"y":459,"width":767,"height":12}},{"id":"1d967010-278e-479b-b7f1-71719834e92d","block_type":"box","text":"in determining the Fund’s NAV. As a result, the Fund’s sale or redemption of its shares at NAV, at a","page_number":56,"box":{"x":117,"y":475,"width":744,"height":12}},{"id":"ffa53a28-f240-449b-8e59-96af819a0268","block_type":"box","text":"time when a holding or holdings are valued at fair value, may have the effect of diluting or increasing","page_number":56,"box":{"x":116,"y":490,"width":750,"height":12}},{"id":"d9380447-a065-4cd8-831b-c55d94ce1a5f","block_type":"box","text":"the economic interest of existing shareholders.","page_number":56,"box":{"x":116,"y":506,"width":352,"height":12}},{"id":"2784ea04-2199-40e2-bc74-918d984f3318","block_type":"box","text":"The Fund’s annual audited financial statements, which are prepared in accordance with accounting","page_number":56,"box":{"x":116,"y":537,"width":740,"height":12}},{"id":"709f9db0-f663-4737-8834-6f6ca365f9ca","block_type":"box","text":"principles generally accepted in the United States of America (“US GAAP”), follow the requirements for","page_number":56,"box":{"x":117,"y":552,"width":767,"height":12}},{"id":"f0f139f9-7ba8-447f-8cab-75e979dfc830","block_type":"box","text":"valuation set forth in Financial Accounting Standards Board Accounting Standards Codification Topic","page_number":56,"box":{"x":116,"y":568,"width":753,"height":12}},{"id":"6e71e951-06aa-4274-84d5-b993a30c1dc1","block_type":"box","text":"820, “Fair Value Measurements and Disclosures” (“ASC 820”), which defines and establishes a","page_number":56,"box":{"x":116,"y":583,"width":712,"height":12}},{"id":"b0522a25-bc1c-49a6-920f-8f38145b2e11","block_type":"box","text":"framework for measuring fair value under US GAAP and expands financial statement disclosure","page_number":56,"box":{"x":116,"y":599,"width":717,"height":12}},{"id":"72442728-d705-4dd6-b049-170003249edc","block_type":"box","text":"requirements relating to fair value measurements.","page_number":56,"box":{"x":117,"y":614,"width":374,"height":12}},{"id":"b69150ff-7de0-4969-b5ed-7e846da937ae","block_type":"box","text":"Generally, ASC 820 and other accounting rules applicable to funds and various assets in which they","page_number":56,"box":{"x":117,"y":645,"width":747,"height":12}},{"id":"c351fa78-7486-49f4-a20f-f9f64c952e28","block_type":"box","text":"invest are evolving. Such changes may adversely affect the Fund. For example, the evolution of rules","page_number":56,"box":{"x":117,"y":661,"width":751,"height":12}},{"id":"85a93859-acf4-4a1a-9bd9-7f1945243e22","block_type":"box","text":"governing the determination of the fair market value of assets or liabilities to the extent such rules","page_number":56,"box":{"x":116,"y":676,"width":723,"height":12}},{"id":"62e1132c-55af-4443-b4b4-82986249d5fe","block_type":"box","text":"become more stringent would tend to increase the cost and/or reduce the availability of third-party","page_number":56,"box":{"x":117,"y":692,"width":726,"height":12}},{"id":"fe0b95c1-6978-44e4-8269-6bce057fbd0a","block_type":"box","text":"determinations of fair market value. This may in turn increase the costs associated with selling assets","page_number":56,"box":{"x":116,"y":707,"width":752,"height":12}},{"id":"5ee19b07-2c25-4ede-aa87-386768def77d","block_type":"box","text":"or affect their liquidity due to the Fund’s inability to obtain a third-party determination of fair market","page_number":56,"box":{"x":116,"y":723,"width":728,"height":12}},{"id":"c20b28b7-8b3c-4358-8c04-f568bd570a12","block_type":"box","text":"value.","page_number":56,"box":{"x":116,"y":738,"width":43,"height":10}},{"id":"cace1ffe-e030-40f4-a46e-b1c0117a59fa","block_type":"box","text":"Brokerage Transactions","page_number":56,"box":{"x":119,"y":790,"width":437,"height":29}},{"id":"012ebf58-7c59-4c4a-b246-ef9d079674a7","block_type":"box","text":"Subject to policies established by the Board, BFA is primarily responsible for the execution of the","page_number":56,"box":{"x":116,"y":842,"width":724,"height":12}},{"id":"d4377f2e-5b1c-42c6-a8c9-7e4c3ba88bc5","block_type":"box","text":"Fund’s portfolio transactions and the allocation of brokerage. BFA does not execute transactions","page_number":56,"box":{"x":117,"y":857,"width":720,"height":12}},{"id":"eb7de27c-4b59-4a8e-b057-4dacf2343e19","block_type":"box","text":"through any particular broker or dealer, but seeks to obtain the best net results for the Fund, taking into","page_number":56,"box":{"x":116,"y":873,"width":770,"height":12}},{"id":"245ed1bd-2592-4289-ac4f-3ddf10c46a3b","block_type":"box","text":"51","page_number":56,"box":{"x":491,"y":909,"width":15,"height":9}},{"id":"625ad42f-6d69-481a-b033-c9ae96d0c611","block_type":"box","text":"NM0926U-5926888-56/257","page_number":56,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"d03f5cbf-556e-4d5b-85e5-161d5c705a95","block_type":"box","text":"account certain factors set out below. While BFA generally seeks reasonable trade execution costs,","page_number":57,"box":{"x":116,"y":87,"width":744,"height":12}},{"id":"498981a0-eb86-43b5-b292-b16d63010541","block_type":"box","text":"the Fund does not necessarily pay the lowest spread or commission available, and payment of the","page_number":57,"box":{"x":116,"y":102,"width":735,"height":13}},{"id":"020b145f-09a0-446c-9d2b-f9d0fe414f88","block_type":"box","text":"lowest commission or spread is not necessarily consistent with obtaining the best price and execution","page_number":57,"box":{"x":117,"y":118,"width":757,"height":12}},{"id":"7b0a838c-6ba5-4b43-a55d-beab5f170daf","block_type":"box","text":"in particular transactions. Subject to applicable legal requirements, BFA may select a broker based","page_number":57,"box":{"x":117,"y":134,"width":738,"height":12}},{"id":"08f629ef-5577-4df4-bbb5-edbb8e06a5e7","block_type":"box","text":"partly upon brokerage or research services provided to BFA and its clients, including the Fund. In","page_number":57,"box":{"x":117,"y":149,"width":726,"height":12}},{"id":"5f8efd2c-e442-45e9-9c05-882da8f510b7","block_type":"box","text":"return for such services, BFA may cause the Fund to pay a higher commission than other brokers","page_number":57,"box":{"x":117,"y":165,"width":729,"height":12}},{"id":"059bef83-78aa-4e05-b3ed-726238d518c8","block_type":"box","text":"would charge if BFA determines in good faith that the commission is reasonable in relation to the","page_number":57,"box":{"x":116,"y":180,"width":723,"height":12}},{"id":"4283ad24-397b-4b73-9c54-7805f257e6ff","block_type":"box","text":"services provided.","page_number":57,"box":{"x":116,"y":196,"width":140,"height":11}},{"id":"6688b3a1-872d-4b43-9068-cf96eac92c9e","block_type":"box","text":"In selecting brokers or dealers to execute portfolio","page_number":57,"box":{"x":117,"y":227,"width":353,"height":12}},{"id":"25d6ecf5-2f4d-4d32-b82f-dcebea919785","block_type":"box","text":"transactions, BFA seeks to obtain the best price and","page_number":57,"box":{"x":471,"y":227,"width":381,"height":11}},{"id":"07ac1235-be6e-4182-885d-80c0d8f76433","block_type":"box","text":"most favorable execution for the Fund, taking into account","page_number":57,"box":{"x":117,"y":242,"width":412,"height":12}},{"id":"01cc566e-472a-4687-8e24-797c99b5b502","block_type":"box","text":"t a variety of factors including: (i) the size, nature","page_number":57,"box":{"x":529,"y":242,"width":344,"height":12}},{"id":"8718663f-49ea-44e5-a28a-3d985c2aff41","block_type":"box","text":"and character of the security or instrument being tr","page_number":57,"box":{"x":116,"y":258,"width":359,"height":12}},{"id":"6a4fd0a5-04d2-49f8-98a0-c7bf2bd9e89a","block_type":"box","text":"aded and the markets in which it is purchased or sold;","page_number":57,"box":{"x":475,"y":258,"width":388,"height":11}},{"id":"66ba0c5c-528b-4535-9900-9777f0f2149a","block_type":"box","text":"(ii) the desired timing of the transaction; (iii)","page_number":57,"box":{"x":117,"y":273,"width":309,"height":12}},{"id":"f629070e-6d2f-45cc-9e8c-c49fd759049e","block_type":"box","text":"BFA’s knowledge of the expected commission rates and","page_number":57,"box":{"x":427,"y":273,"width":404,"height":12}},{"id":"6d4b3bfe-c541-4b2d-a514-8a0bcacd8b0b","block_type":"box","text":"spreads currently available; (iv) the activity existing","page_number":57,"box":{"x":116,"y":289,"width":365,"height":12}},{"id":"0770433b-3fea-40c5-a2c0-a65f5a1a2543","block_type":"box","text":"and expected in the market for the particular security or","page_number":57,"box":{"x":481,"y":289,"width":397,"height":12}},{"id":"aa37d328-ad49-443f-8b1e-45dbc2f7f970","block_type":"box","text":"instrument, including any anticipated execution difficultie","page_number":57,"box":{"x":117,"y":304,"width":398,"height":12}},{"id":"b9b62889-3683-4442-98f5-9e3353d548ef","block_type":"box","text":"s; (v) the full range of brokerage services provided;","page_number":57,"box":{"x":515,"y":304,"width":366,"height":12}},{"id":"8df7108d-3ce1-4e40-bdf1-ba54adcb76f5","block_type":"box","text":"(vi) the broker’s or dealer’s capital; (vii) the quality","page_number":57,"box":{"x":117,"y":320,"width":355,"height":12}},{"id":"86db0c9b-edab-4a2b-aaeb-5011ac604916","block_type":"box","text":"of research and research services provided; (viii) the","page_number":57,"box":{"x":472,"y":320,"width":378,"height":12}},{"id":"3bc193b1-c0b5-4018-8889-e39bcfaf7520","block_type":"box","text":"reasonableness of the commission, dealer spread or it","page_number":57,"box":{"x":117,"y":335,"width":385,"height":12}},{"id":"3cac73a6-658d-4a51-97fa-e4bb5d24756e","block_type":"box","text":"s equivalent for the specific transaction; and","page_number":57,"box":{"x":503,"y":335,"width":316,"height":12}},{"id":"5057c61a-9d94-4336-b2f2-62bf4581584d","block_type":"box","text":"(ix) BFA’s knowledge of any actual or apparent","page_number":57,"box":{"x":117,"y":351,"width":332,"height":12}},{"id":"7b3c8f9f-6815-4c66-88cf-20758db41449","block_type":"box","text":"t operational problems of a broker or dealer.","page_number":57,"box":{"x":449,"y":351,"width":313,"height":12}},{"id":"a1fa0ba0-24f8-4059-be2b-98cfad7fb295","block_type":"box","text":"Section 28(e) of the 1934 Act (“Section 28(e)”) permits an investment adviser, under certain","page_number":57,"box":{"x":116,"y":382,"width":686,"height":12}},{"id":"c8492e4a-8dfe-4b25-a427-392fbf384236","block_type":"box","text":"circumstances, to cause an account to pay a broker or dealer a commission for effecting a transaction","page_number":57,"box":{"x":116,"y":397,"width":762,"height":12}},{"id":"1ab412ee-4e2d-4805-9829-7ee2aa4422e3","block_type":"box","text":"that exceeds the amount another broker or dealer would have charged for effecting the same","page_number":57,"box":{"x":116,"y":413,"width":696,"height":12}},{"id":"9f81f05c-085a-4823-8b54-4f5302e822c6","block_type":"box","text":"transaction in recognition of the value of brokerage and research services provided by that broker or","page_number":57,"box":{"x":116,"y":428,"width":748,"height":12}},{"id":"80eb8bcd-a68b-4130-914c-ec9efd3cad7a","block_type":"box","text":"dealer. This includes commissions paid on riskless principal transactions under certain conditions.","page_number":57,"box":{"x":116,"y":444,"width":732,"height":12}},{"id":"e30032d2-ce19-4145-abf1-8769d3a02f53","block_type":"box","text":"Brokerage and research services include: (1) furnishing advice as to the value of securities, including","page_number":57,"box":{"x":117,"y":459,"width":754,"height":12}},{"id":"cb17084d-6de5-4f1a-a462-c088a41a19d7","block_type":"box","text":"pricing and appraisal advice, credit analysis, risk measurement analysis, performance and other","page_number":57,"box":{"x":117,"y":475,"width":716,"height":12}},{"id":"ae03d3a5-5799-4185-818c-142bff7d049b","block_type":"box","text":"analysis, as well as the advisability of investing in, purchasing or selling securities, and the availability","page_number":57,"box":{"x":116,"y":490,"width":758,"height":12}},{"id":"a8b0e7f4-144f-4f7a-92e8-f92c7eae5fc6","block_type":"box","text":"of securities or purchasers or sellers of securities; (2) furnishing analyses and reports concerning","page_number":57,"box":{"x":116,"y":506,"width":725,"height":12}},{"id":"f76b829f-1d1c-40d7-bea8-b81837080bb4","block_type":"box","text":"issuers, industries, securities, economic factors and trends, portfolio strategy, and the performance of","page_number":57,"box":{"x":117,"y":521,"width":757,"height":12}},{"id":"e665cb07-a09e-44ee-8fb1-4e52f11d9eb4","block_type":"box","text":"accounts; and (3) effecting securities transactions and performing functions incidental to securities","page_number":57,"box":{"x":116,"y":537,"width":734,"height":12}},{"id":"54134381-235b-4dee-8c07-bc95f1fc3865","block_type":"box","text":"transactions (such as clearance, settlement, and custody). BFA believes that access to independent","page_number":57,"box":{"x":116,"y":552,"width":748,"height":12}},{"id":"aefb7b48-746b-473e-9446-81a9efc8bd1e","block_type":"box","text":"investment research is beneficial to its investment decision-making processes and, therefore, to the","page_number":57,"box":{"x":117,"y":568,"width":743,"height":12}},{"id":"45bc7187-f946-4330-9b3e-882467982f66","block_type":"box","text":"Fund.","page_number":57,"box":{"x":117,"y":583,"width":46,"height":10}},{"id":"fec05ced-c004-4a52-8802-6af5fcb9515c","block_type":"box","text":"BFA, unless prohibited by applicable law, may participate in client commission arrangements under","page_number":57,"box":{"x":117,"y":614,"width":740,"height":12}},{"id":"4aabf648-e159-4ecf-865e-05fe30dbc7ae","block_type":"box","text":"which BFA may execute transactions through a broker-dealer and request that the broker-dealer","page_number":57,"box":{"x":116,"y":630,"width":720,"height":12}},{"id":"305d40b2-8279-452b-8df6-b318347a28d8","block_type":"box","text":"allocate a portion of the commissions or commission credits to another firm that provides research to","page_number":57,"box":{"x":116,"y":645,"width":752,"height":12}},{"id":"8df12d47-07bc-4868-a71b-3d8ecb03fb34","block_type":"box","text":"BFA. BFA believes that research services obtained through soft dollar or commission sharing","page_number":57,"box":{"x":117,"y":661,"width":690,"height":12}},{"id":"a9a1335c-b934-499e-9472-5110a39fe851","block_type":"box","text":"arrangements enhance its investment decision-making capabilities, thereby increasing the prospects","page_number":57,"box":{"x":116,"y":676,"width":746,"height":12}},{"id":"e62b500e-1c30-409c-bfa8-a1d59d718a0f","block_type":"box","text":"for higher investment returns. BFA will engage only in soft dollar or commission sharing transactions","page_number":57,"box":{"x":116,"y":692,"width":744,"height":12}},{"id":"00f9f630-7b2f-4fcc-94b2-a95eaa647180","block_type":"box","text":"that comply with the requirements of Section 28(e).","page_number":57,"box":{"x":116,"y":707,"width":378,"height":12}},{"id":"4e8c4ab2-1e8e-4d33-8bea-e4be26b05ff7","block_type":"box","text":"BFA regularly evaluates the soft dollar products and services utilized, as well as the overall soft dollar","page_number":57,"box":{"x":117,"y":738,"width":752,"height":12}},{"id":"274e5d40-1dda-4cbe-9154-d9adf2f18d0f","block_type":"box","text":"and commission sharing arrangements to ensure that trades are executed by firms that are regarded","page_number":57,"box":{"x":116,"y":754,"width":747,"height":12}},{"id":"29718c77-d2cd-4c29-80dd-54f2c698390b","block_type":"box","text":"as best able to execute trades for client accounts, while at the same time providing access to the","page_number":57,"box":{"x":116,"y":769,"width":718,"height":12}},{"id":"8c4902a9-ebc6-4392-95bc-9f6cf7f4da52","block_type":"box","text":"research and other services BFA views as impactful to its trading results.","page_number":57,"box":{"x":117,"y":785,"width":539,"height":12}},{"id":"00349926-5296-44f6-99ad-561561f8bf72","block_type":"box","text":"BFA, unless prohibited by applicable law, may utilize soft dollars and related services, including","page_number":57,"box":{"x":117,"y":816,"width":706,"height":12}},{"id":"b0098340-b1d6-4a5b-a3f2-51aeb3bdc79e","block_type":"box","text":"research (whether prepared by the broker-dealer or prepared by a third-party and provided to BFA by","page_number":57,"box":{"x":117,"y":831,"width":756,"height":12}},{"id":"1bed9345-e2b9-48cd-9868-ab92d58b2f5f","block_type":"box","text":"the broker-dealer) and execution or brokerage services within applicable rules and BFA’s policies to","page_number":57,"box":{"x":116,"y":847,"width":745,"height":12}},{"id":"e5d24b3b-effe-40f2-8e44-abb29cacb712","block_type":"box","text":"the extent that such permitted services do not compromise BFA’s ability to seek to obtain best","page_number":57,"box":{"x":116,"y":862,"width":703,"height":12}},{"id":"ba8d2eda-adce-4f15-88fe-e868867e3c4c","block_type":"box","text":"execution. In this regard, the portfolio management investment and/or trading teams may consider a","page_number":57,"box":{"x":116,"y":878,"width":749,"height":12}},{"id":"60f675af-d1b7-45fc-b5d5-ecc1826eb58c","block_type":"box","text":"52","page_number":57,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"2e1faadd-ab6c-49d6-b762-bf527845aea9","block_type":"box","text":"NM0926U-5926888-57/257","page_number":57,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"c264c841-92f2-4294-9acf-fc80043eaa2f","block_type":"box","text":"variety of factors, including the degree to which the broker-dealer: (a) provides access to company","page_number":58,"box":{"x":116,"y":87,"width":735,"height":12}},{"id":"27128ac8-c6de-4426-84b2-b9a4d93008f5","block_type":"box","text":"management; (b) provides access to their analysts; (c) provides meaningful/insightful research notes","page_number":58,"box":{"x":117,"y":102,"width":751,"height":13}},{"id":"d7c6b385-7e80-4f48-9b31-ac8f8e9fb6d9","block_type":"box","text":"on companies or other potential investments; (d) facilitates calls on which meaningful or insightful ideas","page_number":58,"box":{"x":116,"y":118,"width":772,"height":12}},{"id":"ab50991a-b016-43bf-8cd1-64323a0dc1bb","block_type":"box","text":"about companies or potential investments are discussed; (e) facilitates conferences at which","page_number":58,"box":{"x":116,"y":134,"width":691,"height":12}},{"id":"627b0566-e820-4f3f-a5a3-502dd3a5ec8b","block_type":"box","text":"meaningful or insightful ideas about companies or potential investments are discussed; or (f) provides","page_number":58,"box":{"x":117,"y":149,"width":758,"height":12}},{"id":"2db79058-816a-4ad4-b36a-f4b49ace79a2","block_type":"box","text":"research tools such as market data, financial analysis, and other third-party related research and","page_number":58,"box":{"x":117,"y":165,"width":722,"height":12}},{"id":"1246eec8-f91f-45de-973e-05e2eab682fe","block_type":"box","text":"brokerage tools that aid in the investment process.","page_number":58,"box":{"x":117,"y":180,"width":380,"height":12}},{"id":"98f454c7-e739-4bfe-afc7-26748e0b0f57","block_type":"box","text":"Research-oriented services for which BFA, unless prohibited by applicable law, might pay with Fund","page_number":58,"box":{"x":117,"y":211,"width":747,"height":12}},{"id":"c8ffce0f-d5e3-496f-81d3-13e30ce17247","block_type":"box","text":"commissions may be in written form or through direct contact with individuals and may include","page_number":58,"box":{"x":116,"y":227,"width":703,"height":12}},{"id":"9fc4d61c-6a33-4d8b-bdad-1567bd6409a9","block_type":"box","text":"information as to particular companies or industries and securities or groups of securities, as well as","page_number":58,"box":{"x":117,"y":242,"width":746,"height":12}},{"id":"fe13c79e-4010-4bb2-9d6a-f73b5adce9f5","block_type":"box","text":"market, economic, or institutional advice and statistical information, political developments and","page_number":58,"box":{"x":117,"y":258,"width":705,"height":11}},{"id":"ce90b6d5-df0e-4b38-91ff-acf1e2138d07","block_type":"box","text":"technical market information that assists in the valuation of investments. Research services furnished","page_number":58,"box":{"x":116,"y":273,"width":757,"height":10}},{"id":"9a623f63-354d-4095-ac8e-f33427cbe2b9","block_type":"box","text":"by brokers may be used in servicing some or all client accounts and not all services may be used in","page_number":58,"box":{"x":117,"y":289,"width":743,"height":12}},{"id":"e63b27a3-70a8-42d2-8c1b-4fce6b263bd3","block_type":"box","text":"connection with the fund or account that paid commissions to the broker providing such services. In","page_number":58,"box":{"x":116,"y":304,"width":743,"height":12}},{"id":"1ae3facf-f044-43b6-9c2f-7cd6de419e1c","block_type":"box","text":"some cases, research information received from brokers by mutual fund management personnel, or","page_number":58,"box":{"x":116,"y":320,"width":746,"height":12}},{"id":"c00ace37-a06d-47f7-8624-5913813bee81","block_type":"box","text":"personnel principally responsible for BFA’s individually managed portfolios, is not necessarily shared","page_number":58,"box":{"x":117,"y":335,"width":750,"height":12}},{"id":"b8bc173e-6d8f-4eb4-806c-0effd59f8ae3","block_type":"box","text":"by and between such personnel. Any investment advisory or other fees paid by the Fund to BFA are","page_number":58,"box":{"x":117,"y":351,"width":747,"height":12}},{"id":"a2ff65ee-4441-494c-8a42-db518f3171c1","block_type":"box","text":"not reduced as a result of BFA’s receipt of research services. In some cases, BFA may receive a","page_number":58,"box":{"x":117,"y":366,"width":723,"height":12}},{"id":"03231301-3a65-42c7-be66-691d1cf551a5","block_type":"box","text":"service from a broker that has both a “research” and a “non-research” use. When this occurs BFA","page_number":58,"box":{"x":116,"y":382,"width":730,"height":9}},{"id":"1b260ea1-993a-4bcd-8d65-2fbaf38620dc","block_type":"box","text":"makes a good faith allocation, under all the circumstances, between the research and non-research","page_number":58,"box":{"x":117,"y":397,"width":744,"height":12}},{"id":"2e01bfe1-e4a5-4edb-a0ca-57c7c95587f0","block_type":"box","text":"uses of the service. The percentage of the service that is used for research purposes may be paid for","page_number":58,"box":{"x":117,"y":413,"width":756,"height":12}},{"id":"e123c95b-b4c1-4bb8-889d-5dfb20b10f9d","block_type":"box","text":"with client commissions, while BFA will use its own funds to pay for the percentage of the service that","page_number":58,"box":{"x":116,"y":428,"width":757,"height":12}},{"id":"89abbeaa-f178-4ae8-bdb5-1e13d389e899","block_type":"box","text":"is used for non-research purposes. In making this good faith allocation, BFA faces a potential conflict","page_number":58,"box":{"x":117,"y":444,"width":753,"height":12}},{"id":"537c1c78-5e7c-4afe-be4a-fe1f2520dd05","block_type":"box","text":"of interest, but BFA believes that its allocation procedures are reasonably designed to ensure that it","page_number":58,"box":{"x":116,"y":459,"width":744,"height":12}},{"id":"b8c9201c-7ba3-40ae-94f7-55527a214562","block_type":"box","text":"appropriately allocates the anticipated use of such services to their research and non-research uses.","page_number":58,"box":{"x":116,"y":475,"width":752,"height":12}},{"id":"f666179f-ab71-4bdd-99d6-fa88f37af1f3","block_type":"box","text":"Payments of commissions to brokers who are affiliated persons of the Fund will be made in","page_number":58,"box":{"x":117,"y":506,"width":681,"height":12}},{"id":"4e6caa67-90f8-4631-a691-f8efdedfa426","block_type":"box","text":"accordance with Rule 17e-1 under the Investment Company Act.","page_number":58,"box":{"x":116,"y":521,"width":486,"height":12}},{"id":"216dd854-1eec-4782-a989-ca3787177b2a","block_type":"box","text":"From time to time, the Fund may purchase new issues of securities in a fixed price offering. In these","page_number":58,"box":{"x":117,"y":552,"width":747,"height":12}},{"id":"26664729-5da7-46e4-85ac-0e50d290982d","block_type":"box","text":"situations, the broker may be a member of the selling group that will, in addition to selling securities,","page_number":58,"box":{"x":116,"y":568,"width":746,"height":12}},{"id":"df0854a4-874b-4a2a-bd8f-d503dc8798d9","block_type":"box","text":"provide BFA with research services. FINRA has adopted rules expressly permitting these types of","page_number":58,"box":{"x":117,"y":583,"width":729,"height":12}},{"id":"3aac4bdb-c437-48c1-95eb-5742138acf9a","block_type":"box","text":"arrangements under certain circumstances. Generally, the broker will provide research “credits” in","page_number":58,"box":{"x":116,"y":599,"width":731,"height":12}},{"id":"3b52011b-066f-4101-8dea-1a584662b277","block_type":"box","text":"these situations at a rate that is higher than that available for typical secondary market transactions.","page_number":58,"box":{"x":116,"y":614,"width":746,"height":12}},{"id":"44543ff4-390e-4b71-814a-d8f73f05546c","block_type":"box","text":"These arrangements may not fall within the safe harbor of Section 28(e).","page_number":58,"box":{"x":116,"y":630,"width":544,"height":12}},{"id":"02d8008f-0afb-4e12-8053-7920aadd27ce","block_type":"box","text":"The Fund anticipates that its brokerage transactions involving foreign securities generally will be","page_number":58,"box":{"x":116,"y":661,"width":713,"height":12}},{"id":"6d4911ea-2e68-4385-9214-183ab3192fd3","block_type":"box","text":"conducted primarily on the principal stock exchanges of the applicable country. Foreign equity","page_number":58,"box":{"x":116,"y":676,"width":697,"height":12}},{"id":"1c4b9b46-928c-46c1-9386-ab5f2a66f8f2","block_type":"box","text":"securities may be held by the Fund in the form of depositary receipts, or other securities convertible","page_number":58,"box":{"x":116,"y":692,"width":739,"height":12}},{"id":"1797a89d-301b-43c4-9722-d761dd8545d7","block_type":"box","text":"into foreign equity securities. Depositary receipts may be listed on stock exchanges, or traded in OTC","page_number":58,"box":{"x":117,"y":707,"width":752,"height":12}},{"id":"997284dd-a848-41a1-b5ea-746708211b20","block_type":"box","text":"markets in the United States or Europe, as the case may be. American Depositary Receipts, like other","page_number":58,"box":{"x":117,"y":723,"width":758,"height":12}},{"id":"2fae8103-948c-40fa-a935-feb4070fda1f","block_type":"box","text":"securities traded in the United States, will be subject to negotiated commission rates.","page_number":58,"box":{"x":116,"y":738,"width":630,"height":12}},{"id":"391ced82-398c-46ec-a503-17776b811ee8","block_type":"box","text":"The Fund may invest in certain securities traded in the OTC market and intends to deal directly with","page_number":58,"box":{"x":116,"y":769,"width":739,"height":12}},{"id":"939f4cae-04a0-497e-8c4d-cd1373a8d2b1","block_type":"box","text":"the dealers who make a market in the particular securities, except in those circumstances in which","page_number":58,"box":{"x":116,"y":785,"width":729,"height":12}},{"id":"51f8c62e-3027-4b80-89ac-266bacc253ec","block_type":"box","text":"better prices and execution are available elsewhere. Under the Investment Company Act, persons","page_number":58,"box":{"x":117,"y":800,"width":727,"height":12}},{"id":"be294644-0bd8-4e9c-9082-f57380ef267c","block_type":"box","text":"affiliated with the Fund and persons who are affiliated with such affiliated persons are prohibited from","page_number":58,"box":{"x":116,"y":816,"width":749,"height":12}},{"id":"c2e942ab-e1af-40e7-a3a9-cf60aa3fa941","block_type":"box","text":"dealing with the Fund as principal in the purchase and sale of securities unless a permissive order","page_number":58,"box":{"x":116,"y":831,"width":733,"height":12}},{"id":"31b86236-5359-4894-a8cf-6141b2fdb560","block_type":"box","text":"allowing such transactions is obtained from the Commission. Since transactions in the OTC market","page_number":58,"box":{"x":116,"y":847,"width":740,"height":12}},{"id":"ef47c580-651c-4df9-8f33-2fc79bd815d9","block_type":"box","text":"usually involve transactions with the dealers acting as principal for their own accounts, the Fund will","page_number":58,"box":{"x":117,"y":862,"width":743,"height":12}},{"id":"93b97d84-1909-4768-9cbe-2e862a9a82b0","block_type":"box","text":"not deal with affiliated persons in connection with such transactions. However, an affiliated person of","page_number":58,"box":{"x":117,"y":878,"width":750,"height":12}},{"id":"34b7d36e-510c-4da4-ba5a-7766a038be8f","block_type":"box","text":"53","page_number":58,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"18450e2b-60d7-49a7-88a9-5b451561782e","block_type":"box","text":"NM0926U-5926888-58/257","page_number":58,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"6bad0cee-70a0-4d7e-b088-3168d41333b3","block_type":"box","text":"the Fund may serve as its broker in OTC transactions conducted on an agency basis provided that,","page_number":59,"box":{"x":116,"y":87,"width":742,"height":12}},{"id":"b94393cb-b2ea-47d4-b034-aab9cd02043a","block_type":"box","text":"among other things, the fee or commission received by such affiliated broker is reasonable and fair","page_number":59,"box":{"x":116,"y":102,"width":739,"height":13}},{"id":"484013b0-1d4a-4493-bac7-9e81111b2bb2","block_type":"box","text":"compared to the fee or commission received by non-affiliated brokers in connection with comparable","page_number":59,"box":{"x":116,"y":118,"width":751,"height":12}},{"id":"09af05f7-4ac5-4608-85c5-43efef5853f1","block_type":"box","text":"transactions.","page_number":59,"box":{"x":116,"y":134,"width":100,"height":9}},{"id":"f2e0a9bb-a8c2-4fb9-8e77-5fc80874bca7","block_type":"box","text":"OTC issues, including most fixed-income securities such as corporate debt and U.S. Government","page_number":59,"box":{"x":116,"y":165,"width":729,"height":12}},{"id":"df52c688-ec7d-4d11-889d-45edfb5f710e","block_type":"box","text":"securities, are normally traded on a “net” basis without a stated commission, through dealers acting for","page_number":59,"box":{"x":116,"y":180,"width":767,"height":12}},{"id":"230a8fae-0f7e-4996-83a9-55e6c733297f","block_type":"box","text":"their own account and not as brokers. The Fund will primarily engage in transactions with these","page_number":59,"box":{"x":116,"y":196,"width":713,"height":12}},{"id":"754ba491-2de4-4609-bcd0-d722e421ef52","block_type":"box","text":"dealers or deal directly with the issuer unless a better price or execution could be obtained by using a","page_number":59,"box":{"x":116,"y":211,"width":757,"height":12}},{"id":"0b680dfc-947e-4cc3-af43-1f0ae37d2f72","block_type":"box","text":"broker. Prices paid to a dealer with respect to both foreign and domestic securities will generally","page_number":59,"box":{"x":117,"y":227,"width":716,"height":12}},{"id":"2a85e572-4cf3-4729-a6fc-392f8a690196","block_type":"box","text":"include a “spread,” which is the difference between the prices at which the dealer is willing to purchase","page_number":59,"box":{"x":117,"y":242,"width":766,"height":12}},{"id":"64ad04be-9b85-4625-bf1e-d97c22dee2f8","block_type":"box","text":"and sell the specific security at the time, and includes the dealer’s normal profit.","page_number":59,"box":{"x":116,"y":258,"width":596,"height":12}},{"id":"ff7d67ff-ed1b-40a8-923d-58b841dbccd3","block_type":"box","text":"Purchases of money market instruments by the Fund are made from dealers, underwriters and issuers.","page_number":59,"box":{"x":117,"y":289,"width":770,"height":12}},{"id":"5e07be8c-f87a-4430-813d-4bc588ff5fdb","block_type":"box","text":"The Fund does not currently expect to incur any brokerage commission expense on such transactions","page_number":59,"box":{"x":116,"y":304,"width":762,"height":12}},{"id":"c92b0684-4329-45d7-9d12-4320bee4bc03","block_type":"box","text":"because money market instruments are generally traded on a “net” basis with dealers acting as","page_number":59,"box":{"x":117,"y":320,"width":712,"height":12}},{"id":"5b18a939-9233-4364-9e33-dc9b2e50b75c","block_type":"box","text":"principal for their own accounts without a stated commission. The price of the security, however,","page_number":59,"box":{"x":117,"y":335,"width":718,"height":12}},{"id":"944c4af4-e4e9-4e1b-b81a-55bf1dcbe60e","block_type":"box","text":"usually includes a profit to the dealer.","page_number":59,"box":{"x":117,"y":351,"width":281,"height":12}},{"id":"0a8bb659-7055-42d8-82b5-3325c7a33a3e","block_type":"box","text":"Securities purchased in underwritten offerings include a fixed amount of compensation to the","page_number":59,"box":{"x":116,"y":382,"width":694,"height":12}},{"id":"b68da024-dd32-4da1-8121-ad7675626915","block_type":"box","text":"underwriter, generally referred to as the underwriter’s concession or discount. When offered securities","page_number":59,"box":{"x":117,"y":397,"width":761,"height":12}},{"id":"eaafd9cf-adfc-4423-8965-d8c4dde7cfbd","block_type":"box","text":"are purchased or sold directly from or to an issuer, no commissions or discounts are paid except where","page_number":59,"box":{"x":116,"y":413,"width":771,"height":12}},{"id":"01322b03-904c-4d59-8f11-a22cc6675235","block_type":"box","text":"required by local markets.","page_number":59,"box":{"x":117,"y":428,"width":196,"height":12}},{"id":"925dfc71-36b8-4558-8c85-5e1be789f96d","block_type":"box","text":"BFA may seek to obtain an undertaking from issuers of commercial paper or dealers selling","page_number":59,"box":{"x":117,"y":459,"width":684,"height":12}},{"id":"583f551d-d9a0-40c3-a3ac-16f805cf621d","block_type":"box","text":"commercial paper to consider the repurchase of such securities from the Fund prior to maturity at their","page_number":59,"box":{"x":116,"y":475,"width":765,"height":12}},{"id":"17f01a86-0a79-4477-84a5-5e1d4397363a","block_type":"box","text":"original cost plus interest (sometimes adjusted to reflect the actual maturity of the securities), if it","page_number":59,"box":{"x":116,"y":490,"width":720,"height":12}},{"id":"f7e7f901-3a7f-46fb-a8a5-132ceb67ad9b","block_type":"box","text":"believes that the Fund’s anticipated need for liquidity makes such action desirable. Any such","page_number":59,"box":{"x":117,"y":506,"width":690,"height":12}},{"id":"faf6995c-0dc6-41e3-b003-372d490dc6f6","block_type":"box","text":"repurchase prior to maturity reduces the possibility that the Fund would incur a capital loss in","page_number":59,"box":{"x":117,"y":521,"width":693,"height":12}},{"id":"77b3c11e-3c15-4c4d-836b-831708c242a3","block_type":"box","text":"liquidating commercial paper, especially if interest rates have risen since acquisition of such","page_number":59,"box":{"x":117,"y":537,"width":685,"height":12}},{"id":"f57df8dd-adca-40c0-915c-35f0ad82788e","block_type":"box","text":"commercial paper.","page_number":59,"box":{"x":116,"y":552,"width":143,"height":12}},{"id":"79779efe-e288-4640-a113-5a8b21f3b1b8","block_type":"box","text":"Investment decisions for the Fund and for other investment accounts managed by BFA and the other","page_number":59,"box":{"x":117,"y":583,"width":753,"height":12}},{"id":"5d2ded40-d196-4c19-b41e-19a72e190694","block_type":"box","text":"Affiliates are made independently of each other in light of differing conditions. BFA allocates","page_number":59,"box":{"x":116,"y":599,"width":686,"height":12}},{"id":"9de3c16c-d21f-462d-912f-045ecb448613","block_type":"box","text":"investments among client accounts in a fair and equitable manner over time. A variety of factors will be","page_number":59,"box":{"x":117,"y":614,"width":767,"height":12}},{"id":"600027c0-c3f6-4b13-923c-c368e4bde573","block_type":"box","text":"considered in making such allocations. These factors include: (i) investment objectives or strategies for","page_number":59,"box":{"x":116,"y":630,"width":769,"height":12}},{"id":"89b7ba71-bdcf-4ae9-92bd-325041b9b2c1","block_type":"box","text":"particular accounts, including sector, industry, country or region and capitalization weightings; (ii) tax","page_number":59,"box":{"x":117,"y":645,"width":749,"height":12}},{"id":"cfbb9cc5-56bb-4301-a91b-7b4eff49d3e8","block_type":"box","text":"considerations of an account; (iii) risk or investment concentration parameters for an account;","page_number":59,"box":{"x":116,"y":661,"width":693,"height":12}},{"id":"9331d051-023b-4621-83a3-fa42ea082a65","block_type":"box","text":"(iv) supply or demand for a security at a given price level; (v) size of available investment; (vi) cash","page_number":59,"box":{"x":117,"y":676,"width":731,"height":12}},{"id":"f2f9b8d3-b5fe-4c6d-b23a-f73d0ebeeffc","block_type":"box","text":"availability and liquidity requirements for accounts; (vii) regulatory restrictions; (viii) minimum","page_number":59,"box":{"x":116,"y":692,"width":684,"height":12}},{"id":"d031d891-9eba-46e8-838c-5423252e0699","block_type":"box","text":"investment size of an account; (ix) relative size of account; and (x) such other factors as may be","page_number":59,"box":{"x":117,"y":707,"width":712,"height":12}},{"id":"aa805f65-b3a2-4bf9-a0c2-cae9b8f9e8b0","block_type":"box","text":"approved by BlackRock’s general counsel. Moreover, investments may not be allocated to one client","page_number":59,"box":{"x":116,"y":723,"width":747,"height":12}},{"id":"ae22e17a-a548-4676-9410-55a5505dc469","block_type":"box","text":"account over another based on any of the following considerations: (i) to favor one client account at the","page_number":59,"box":{"x":116,"y":738,"width":766,"height":12}},{"id":"64363d69-784a-4676-99e4-259afaad0d6e","block_type":"box","text":"expense of another; (ii) to generate higher fees paid by one client account over another or to produce","page_number":59,"box":{"x":116,"y":754,"width":752,"height":12}},{"id":"cb1a9930-aa90-42f2-bc4c-d6de324f6015","block_type":"box","text":"greater performance compensation to BlackRock; (iii) to develop or enhance a relationship with a client","page_number":59,"box":{"x":116,"y":769,"width":765,"height":12}},{"id":"2053776c-3b3f-4743-8ef3-1afe06beee2f","block_type":"box","text":"or prospective client; (iv) to compensate a client for past services or benefits rendered to BlackRock or","page_number":59,"box":{"x":116,"y":785,"width":761,"height":12}},{"id":"bcf67b8f-9e75-49db-890c-de118af40287","block_type":"box","text":"to induce future services or benefits to be rendered to BlackRock; or (v) to manage or equalize","page_number":59,"box":{"x":116,"y":800,"width":702,"height":12}},{"id":"c4d7bca7-9122-4575-8f8a-6514ae4f84fc","block_type":"box","text":"investment performance among different client accounts.","page_number":59,"box":{"x":117,"y":816,"width":420,"height":12}},{"id":"ce234f84-1052-422d-a05a-e476b2f08ce1","block_type":"box","text":"Equity securities will generally be allocated among client accounts within the same investment","page_number":59,"box":{"x":117,"y":847,"width":702,"height":12}},{"id":"9f8e5fac-f599-4034-a0c9-2f1c74eed281","block_type":"box","text":"mandate on a pro rata basis. All allocations of equity securities will be subject, where relevant, to share","page_number":59,"box":{"x":117,"y":862,"width":769,"height":12}},{"id":"7ae5298e-af78-43d1-b068-3be649591ac2","block_type":"box","text":"minimums established for accounts and compliance constraints.","page_number":59,"box":{"x":117,"y":878,"width":479,"height":12}},{"id":"563bd98b-f77b-4ce9-ad40-3abbe0e7c1e9","block_type":"box","text":"54","page_number":59,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"dcd57924-3236-4e96-b7a7-a7f1da25dbdb","block_type":"box","text":"NM0926U-5926888-59/257","page_number":59,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"a86f609b-9e1e-4810-b53f-cd4a59d2d8b7","block_type":"box","text":"Initial public offerings (“IPOs”) of securities may be over-subscribed and subsequently trade at a","page_number":60,"box":{"x":117,"y":87,"width":716,"height":12}},{"id":"4331195b-4fa8-43ae-adf6-1fdabf5db8a4","block_type":"box","text":"premium in the secondary market. In these situations, the supply of securities available for client","page_number":60,"box":{"x":117,"y":102,"width":718,"height":13}},{"id":"9c5dbed6-4aaf-4679-b6b1-626cfc944585","block_type":"box","text":"accounts is often less than the amount of securities the accounts would otherwise take. In order to","page_number":60,"box":{"x":116,"y":118,"width":734,"height":10}},{"id":"f2604c7f-7104-4d98-bb5c-a279b756d24b","block_type":"box","text":"allocate these investments fairly and equitably among client accounts over time, each portfolio","page_number":60,"box":{"x":116,"y":134,"width":704,"height":12}},{"id":"a4348f95-4de0-454d-9fee-0565964391b4","block_type":"box","text":"manager or a member of his or her respective investment team will indicate to BFA’s trading desk their","page_number":60,"box":{"x":117,"y":149,"width":766,"height":12}},{"id":"eceb1b27-4a5c-43ed-868d-b87981793636","block_type":"box","text":"level of interest in a particular offering with respect to eligible client accounts for which that team is","page_number":60,"box":{"x":117,"y":165,"width":733,"height":12}},{"id":"653611f3-563b-41da-9f54-a699f8c2fa76","block_type":"box","text":"responsible. IPOs of U.S. equity securities will be identified as eligible for particular client accounts that","page_number":60,"box":{"x":117,"y":180,"width":768,"height":12}},{"id":"79aa19a2-3586-4a10-b592-18394f606301","block_type":"box","text":"are managed by portfolio teams who have indicated interest in the offering based on market","page_number":60,"box":{"x":116,"y":196,"width":687,"height":12}},{"id":"f007603b-982b-40c6-ad41-c805135727b3","block_type":"box","text":"capitalization of the issuer of the security and the investment mandate of the client account and in the","page_number":60,"box":{"x":116,"y":211,"width":758,"height":12}},{"id":"c084b7ee-69e6-4cb1-aba1-c9bd0a8157cb","block_type":"box","text":"case of international equity securities, the country where the offering is taking place and the investment","page_number":60,"box":{"x":116,"y":227,"width":771,"height":12}},{"id":"e16e6292-e26a-4f85-9553-a0b08636a4f4","block_type":"box","text":"mandate of the client account. Generally, shares received during the IPO will be allocated among","page_number":60,"box":{"x":117,"y":242,"width":726,"height":12}},{"id":"08910b46-1dbe-4370-8fcd-773cc7925208","block_type":"box","text":"participating client accounts within each investment mandate on a p","page_number":60,"box":{"x":117,"y":258,"width":493,"height":12}},{"id":"0c706e18-530a-4e0e-b96e-5da596e2e109","block_type":"box","text":"pro rata","page_number":60,"box":{"x":609,"y":258,"width":58,"height":11}},{"id":"807282ae-a672-4619-af7d-c4054b9006bb","block_type":"box","text":"basis. In situations where","page_number":60,"box":{"x":668,"y":258,"width":198,"height":9}},{"id":"63be79f0-f36b-4716-8cfe-184ae9318679","block_type":"box","text":"supply is too limited to be allocated among all accounts for which the investment is eligible, portfolio","page_number":60,"box":{"x":116,"y":273,"width":744,"height":12}},{"id":"1ff40ddd-1be2-414f-a43c-e30b93ce686a","block_type":"box","text":"managers may rotate such investment opportunities among one or more accounts so long as the","page_number":60,"box":{"x":117,"y":289,"width":723,"height":12}},{"id":"c8cafa9a-ae4b-4bc3-8bdc-1e1d782b3564","block_type":"box","text":"rotation system provides for fair access for all client accounts over time. Other allocation","page_number":60,"box":{"x":117,"y":304,"width":659,"height":12}},{"id":"29f348fa-4c4e-42c3-ab4b-877d5c51e337","block_type":"box","text":"methodologies that are considered by BFA to be fair and equitable to clients may be used as well.","page_number":60,"box":{"x":117,"y":320,"width":730,"height":12}},{"id":"9ad0d285-c4e5-4601-b6d6-a83e2307fccf","block_type":"box","text":"Because different accounts may have differing investment objectives and policies, BFA may buy and","page_number":60,"box":{"x":117,"y":351,"width":751,"height":12}},{"id":"ce4fc96f-7414-453a-9df9-97fa96e699be","block_type":"box","text":"sell the same securities at the same time for different clients based on the particular investment","page_number":60,"box":{"x":116,"y":366,"width":713,"height":12}},{"id":"c4394427-6c75-4c25-a724-e470cf487b9f","block_type":"box","text":"objective, guidelines and strategies of those accounts. For example, BFA may decide that it may be","page_number":60,"box":{"x":116,"y":382,"width":745,"height":12}},{"id":"4bbb39f4-7e94-4182-90e6-d0412777879b","block_type":"box","text":"entirely appropriate for a growth fund to sell a security at the same time a value fund is buying that","page_number":60,"box":{"x":116,"y":397,"width":734,"height":12}},{"id":"34c9005c-9038-4847-a632-c835d5a7a35d","block_type":"box","text":"security. To the extent that transactions on behalf of more than one client of BFA or the other Affiliates","page_number":60,"box":{"x":116,"y":413,"width":764,"height":12}},{"id":"7781dcb5-4b97-4d58-a680-c4419ec8d149","block_type":"box","text":"during the same period increase the demand for securities being purchased or the supply of securities","page_number":60,"box":{"x":116,"y":428,"width":763,"height":12}},{"id":"02074881-5fbb-41b5-9644-b07a648a5b04","block_type":"box","text":"being sold, there may be an adverse effect on price. For example, sales of a security by BlackRock on","page_number":60,"box":{"x":117,"y":444,"width":763,"height":12}},{"id":"99738d22-87b7-4e98-8d45-57a6df2a4171","block_type":"box","text":"behalf of one or more of its clients may decrease the market price of such security, adversely","page_number":60,"box":{"x":117,"y":459,"width":695,"height":12}},{"id":"c643ff4b-0989-4027-9a70-74fd463f206a","block_type":"box","text":"impacting other BlackRock clients that still hold the security. If purchases or sales of securities arise for","page_number":60,"box":{"x":117,"y":475,"width":769,"height":12}},{"id":"3e570371-4f80-4344-bdbb-e07b097a513b","block_type":"box","text":"consideration at or about the same time that would involve the Fund or other clients or funds for which","page_number":60,"box":{"x":116,"y":490,"width":763,"height":10}},{"id":"0880353e-e62c-487f-b29d-97840bd33686","block_type":"box","text":"BFA or another Affiliate act as investment manager, transactions in such securities will be made,","page_number":60,"box":{"x":117,"y":506,"width":721,"height":12}},{"id":"622e8973-a238-4211-be04-2387cabbcac6","block_type":"box","text":"insofar as feasible, for the respective funds and clients in a manner deemed equitable to all.","page_number":60,"box":{"x":117,"y":521,"width":686,"height":12}},{"id":"2a2a7c0e-9781-48c3-b286-ffd01f78ba84","block_type":"box","text":"In certain instances, BFA may find it efficient for purposes of seeking to obtain best execution, to","page_number":60,"box":{"x":117,"y":552,"width":720,"height":12}},{"id":"4e4dfc3e-7f02-4d72-964f-b1a3edbc0a22","block_type":"box","text":"aggregate certain contemporaneous purchases or sale orders of its advisory accounts and advisory","page_number":60,"box":{"x":116,"y":568,"width":745,"height":12}},{"id":"a520a9c1-4247-4733-853a-727e32d0bcb1","block_type":"box","text":"accounts of affiliates. In general, all contemporaneous trades for client accounts under management by","page_number":60,"box":{"x":116,"y":583,"width":772,"height":12}},{"id":"4be0da3e-eaff-4f39-b377-862fe545380c","block_type":"box","text":"the same portfolio manager or investment team will be aggregated in a single order if the trader","page_number":60,"box":{"x":116,"y":599,"width":713,"height":12}},{"id":"0c79d3a9-a380-465b-a44d-6fbdae165b9a","block_type":"box","text":"believes the aggregated trade would provide each client with an opportunity to achieve a more","page_number":60,"box":{"x":117,"y":614,"width":704,"height":12}},{"id":"89b2f937-2380-4f31-9184-2af5a60d7643","block_type":"box","text":"favorable execution at a potentially lower execution cost. The costs associated with an aggregated","page_number":60,"box":{"x":116,"y":630,"width":736,"height":12}},{"id":"3db63b58-792c-49b6-b398-7ad4102f77c1","block_type":"box","text":"order will be shared p","page_number":60,"box":{"x":116,"y":645,"width":151,"height":10}},{"id":"aed4cde9-1b0d-4789-a1f9-c72df6cb5e34","block_type":"box","text":"pro rata","page_number":60,"box":{"x":267,"y":645,"width":58,"height":12}},{"id":"8b75ad4d-7997-4a32-bee7-420719161b90","block_type":"box","text":"among the clients in the aggregated order. Generally, if an order for a","page_number":60,"box":{"x":325,"y":645,"width":526,"height":12}},{"id":"c0459a44-0bf8-4766-94c0-0f2fa1025709","block_type":"box","text":"particular portfolio manager or management team is filled at several different prices through multiple","page_number":60,"box":{"x":117,"y":661,"width":741,"height":12}},{"id":"b44aed4a-06f6-46c5-bee4-23e5b04a80f0","block_type":"box","text":"trades, all accounts participating in the order will receive the average price (except in the case of","page_number":60,"box":{"x":116,"y":676,"width":717,"height":12}},{"id":"e7c7516f-cd10-459d-ab72-8beee0d56562","block_type":"box","text":"certain international markets where average pricing is not permitted). While in some cases this practice","page_number":60,"box":{"x":116,"y":692,"width":765,"height":12}},{"id":"e0a6b3b4-f15f-4fe0-9f91-bd493c571246","block_type":"box","text":"could have a detrimental effect upon the price or value of the security as far as the Fund is concerned,","page_number":60,"box":{"x":116,"y":707,"width":758,"height":12}},{"id":"13597109-82ad-4984-a64e-6dbc57b3b4d8","block_type":"box","text":"in other cases it could be beneficial to the Fund. Transactions effected by BFA or the other Affiliates on","page_number":60,"box":{"x":117,"y":723,"width":762,"height":12}},{"id":"1bd61658-b63d-470a-963b-ba1fd65f09dc","block_type":"box","text":"behalf of more than one of its clients during the same period may increase the demand for securities","page_number":60,"box":{"x":117,"y":738,"width":744,"height":12}},{"id":"9c2d5fe6-337d-4371-849a-008b0ba24e59","block_type":"box","text":"being purchased or the supply of securities being sold, causing an adverse effect on price. The trader","page_number":60,"box":{"x":117,"y":754,"width":753,"height":12}},{"id":"7898cc9f-c214-4dac-b1d3-cfa7d825d0b7","block_type":"box","text":"will give the aggregated order to the broker-dealer that the trader has identified as being able to","page_number":60,"box":{"x":116,"y":769,"width":708,"height":12}},{"id":"69833d3d-07de-477f-844c-c091a93a252d","block_type":"box","text":"provide the best execution of the order. Orders for purchase or sale of securities will be placed within a","page_number":60,"box":{"x":117,"y":785,"width":762,"height":12}},{"id":"1d0d7c89-0b06-4faa-9de8-47bb0a0dcfb8","block_type":"box","text":"reasonable amount of time of the order receipt and aggregated orders will be kept aggregated only","page_number":60,"box":{"x":117,"y":800,"width":732,"height":12}},{"id":"c86737df-ab07-4547-8c72-066251270f88","block_type":"box","text":"long enough to execute the order.","page_number":60,"box":{"x":117,"y":816,"width":249,"height":12}},{"id":"27926623-79d3-4aca-a2c4-9abc669da5a7","block_type":"box","text":"The Fund will not purchase securities during the existence of any underwriting or selling group relating","page_number":60,"box":{"x":116,"y":847,"width":764,"height":12}},{"id":"35af50ab-f5fd-460c-8b62-ce4bf4d5d66a","block_type":"box","text":"to such securities of which BFA, BRIL or any affiliated person (as defined in the Investment Company","page_number":60,"box":{"x":116,"y":862,"width":758,"height":12}},{"id":"ac3b77b1-9a45-4fbb-9798-d260fc3ef1b1","block_type":"box","text":"Act) thereof is a member except pursuant to procedures adopted by the Board in accordance with","page_number":60,"box":{"x":116,"y":878,"width":731,"height":12}},{"id":"6b324370-a454-494a-9d5b-3adb06020f33","block_type":"box","text":"55","page_number":60,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"2c46599f-0643-4065-ab70-9f7954ff0936","block_type":"box","text":"NM0926U-5926888-60/257","page_number":60,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"1e2348f2-f138-463f-989b-9aa5ceef1f69","block_type":"box","text":"Rule 10f-3 under the Investment Company Act. In no instance will portfolio securities be purchased","page_number":61,"box":{"x":117,"y":87,"width":739,"height":12}},{"id":"5d1b4c95-a41e-4505-a0c9-0abb0b7fe6a8","block_type":"box","text":"from or sold to BFA, BRIL or any affiliated person of the foregoing entities except as permitted by","page_number":61,"box":{"x":116,"y":102,"width":725,"height":13}},{"id":"6b748e91-b251-4ff0-8010-9a2bf28c25a4","block_type":"box","text":"Commission exemptive order or by applicable law.","page_number":61,"box":{"x":117,"y":118,"width":378,"height":12}},{"id":"062d89e6-5b63-4501-911e-51c2b95c0304","block_type":"box","text":"The information shown below prior to January 23, 2026, with respect to brokerage commissions is that","page_number":61,"box":{"x":116,"y":147,"width":772,"height":12}},{"id":"0cbd1029-4c91-4b74-be2b-e31e2811493b","block_type":"box","text":"of the Predecessor Fund. The table below sets forth the brokerage commissions paid by the Fund for","page_number":61,"box":{"x":116,"y":163,"width":772,"height":12}},{"id":"4c5b295d-0326-4eef-a882-91f0cf5bfbfc","block_type":"box","text":"the fiscal years noted.","page_number":61,"box":{"x":116,"y":178,"width":168,"height":12}},{"id":"a4ccde90-a1e5-4975-912f-3624b1ace322","block_type":"box","text":"Total Brokerage","page_number":61,"box":{"x":595,"y":204,"width":102,"height":10}},{"id":"f9af6461-bf53-4025-8ee3-8b099cb73bfa","block_type":"box","text":"Commissions Paid","page_number":61,"box":{"x":586,"y":215,"width":119,"height":7}},{"id":"2e65916e-1dc0-4d3e-a5c4-b935dcb953fd","block_type":"box","text":"Brokerage Commissions","page_number":61,"box":{"x":726,"y":204,"width":157,"height":10}},{"id":"dad087a7-0143-4e04-92b4-45b5dd07875d","block_type":"box","text":"Paid to Affiliates","page_number":61,"box":{"x":752,"y":215,"width":104,"height":7}},{"id":"83e13e29-2529-497a-96d9-61e6d716abfe","block_type":"box","text":"Fiscal Period from January 24, 2026 to April 30, 2026 $11,800 $0","page_number":61,"box":{"x":117,"y":233,"width":701,"height":12}},{"id":"7eaf4919-ef06-41ee-91a4-83577adfabe0","block_type":"box","text":"Fiscal Period from May 1, 2025 to January 23, 2026 $15,956 $0","page_number":61,"box":{"x":117,"y":248,"width":701,"height":13}},{"id":"5114ba38-5845-46cc-a1ba-920a5ba91a51","block_type":"box","text":"Fiscal Year Ended April 30, 2025 $19,454 $0","page_number":61,"box":{"x":117,"y":264,"width":701,"height":12}},{"id":"0e7efb22-cb80-4f17-93ff-f487fbd246ab","block_type":"box","text":"Fiscal Year Ended April 30, 2024 $28,773 $0","page_number":61,"box":{"x":117,"y":279,"width":701,"height":13}},{"id":"78724abc-6f98-45e2-a3eb-5e46a2ad4139","block_type":"box","text":"As of April 30, 2026, the value of the Fund’s holdings of the securities of its regular brokers or dealers","page_number":61,"box":{"x":116,"y":309,"width":759,"height":12}},{"id":"5e7799c2-c9e6-4ed7-888b-4778a27d3f90","block_type":"box","text":"(as defined in Rule 10b-1 under the Investment Company Act), if any portion of such holdings were","page_number":61,"box":{"x":117,"y":325,"width":739,"height":12}},{"id":"3e66458e-2312-40b0-8622-0b0ba3b15bbe","block_type":"box","text":"purchased during the fiscal year ended April 30, 2026, is as follows:","page_number":61,"box":{"x":117,"y":340,"width":507,"height":12}},{"id":"209d7e14-dc10-4535-9a5f-5afafed676bd","block_type":"box","text":"Regular Broker/Dealer","page_number":61,"box":{"x":117,"y":366,"width":141,"height":10}},{"id":"314fde8d-7add-43ba-9271-2516545f9690","block_type":"box","text":"Debt (D)/Equity (E)","page_number":61,"box":{"x":561,"y":366,"width":117,"height":10}},{"id":"efbe3ba8-71ac-4a8d-a8a6-488b53d553f3","block_type":"box","text":"Aggregate Holdings (000s)","page_number":61,"box":{"x":713,"y":366,"width":170,"height":10}},{"id":"b62dee40-302e-4c03-b521-f779d603e875","block_type":"box","text":"J.P. Morgan Securities LLC D $10,402","page_number":61,"box":{"x":116,"y":384,"width":717,"height":13}},{"id":"964ed8b6-4577-4515-988c-68189e8e5a69","block_type":"box","text":"Barclays Capital, Inc. D $ 4,563","page_number":61,"box":{"x":117,"y":400,"width":716,"height":13}},{"id":"104e7fe4-a31c-4c4e-9b47-efc18dae11ae","block_type":"box","text":"Wells Fargo Securities LLC D $ 2,949","page_number":61,"box":{"x":116,"y":415,"width":717,"height":13}},{"id":"68754bf4-e2b2-43fc-9863-44227f5979f2","block_type":"box","text":"Citigroup Global Markets, Inc. D $ 2,298","page_number":61,"box":{"x":117,"y":431,"width":716,"height":13}},{"id":"170e6d94-1838-4484-891c-4ca3a61b4149","block_type":"box","text":"Deutsche Bank Securities, Inc. D $ 886","page_number":61,"box":{"x":117,"y":446,"width":716,"height":12}},{"id":"7fac9292-5127-46fa-a4c2-af4a5b2982fa","block_type":"box","text":"Morgan Stanley & Co. LLC D $ 667","page_number":61,"box":{"x":117,"y":462,"width":716,"height":13}},{"id":"aee450bb-1725-4f3d-860a-de8ed788fb1a","block_type":"box","text":"Goldman Sachs & Co. LLC D $ 143","page_number":61,"box":{"x":117,"y":477,"width":716,"height":12}},{"id":"baad5748-46b4-4b84-af03-0fe0e84ddfc0","block_type":"box","text":"UBS Securities LLC D $ 119","page_number":61,"box":{"x":117,"y":493,"width":716,"height":11}},{"id":"b9c29b0d-cc46-4cf6-b965-9e3d4346157b","block_type":"box","text":"BofA Securities, Inc. D $ 54","page_number":61,"box":{"x":117,"y":508,"width":716,"height":12}},{"id":"14510a9e-1142-41e1-b98e-aa85c3dcb770","block_type":"box","text":"The Fund’s purchase and sale orders for securities may be combined with those of other investment","page_number":61,"box":{"x":116,"y":538,"width":749,"height":12}},{"id":"8702cab0-b88b-48b5-8155-c0af84692a16","block_type":"box","text":"companies, clients or accounts that BlackRock manages or advises. 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Ownership of beneficial interests in","page_number":63,"box":{"x":117,"y":475,"width":716,"height":12}},{"id":"902db428-868a-4166-ad01-cab3955db9d8","block_type":"box","text":"shares (owners of such beneficial interests are referred to herein as “Beneficial Owners”) is shown on,","page_number":63,"box":{"x":116,"y":490,"width":763,"height":12}},{"id":"9254bf97-8352-42c3-9ccd-84e37f1f1423","block_type":"box","text":"and the transfer of ownership is effected only through, records maintained by DTC (with respect to","page_number":63,"box":{"x":116,"y":506,"width":734,"height":12}},{"id":"37f5b0b2-f93b-4c76-95e1-27609302e238","block_type":"box","text":"DTC Participants) and on the records of DTC Participants (with respect to Indirect Participants and","page_number":63,"box":{"x":117,"y":521,"width":736,"height":12}},{"id":"2edc5a86-5146-43fa-a125-5197c15f558a","block_type":"box","text":"Beneficial Owners that are not DTC Participants). Beneficial Owners will receive from or through the","page_number":63,"box":{"x":117,"y":537,"width":746,"height":12}},{"id":"3c29c451-59d7-4933-b10c-1c9a5f271104","block_type":"box","text":"DTC Participant a written confirmation relating to their purchase of shares. The laws of some","page_number":63,"box":{"x":117,"y":552,"width":692,"height":12}},{"id":"6ee65f1b-a00b-4df4-8ad7-5df4e54d4885","block_type":"box","text":"jurisdictions may require that certain purchasers of securities take physical delivery of such securities","page_number":63,"box":{"x":115,"y":568,"width":757,"height":12}},{"id":"54d993f6-d51e-40c7-99cc-814d228d8292","block_type":"box","text":"in definitive form. Such laws may impair the ability of certain investors to acquire beneficial interests in","page_number":63,"box":{"x":117,"y":583,"width":761,"height":12}},{"id":"80ca9456-31a5-4801-9e27-4a44b6268e9d","block_type":"box","text":"shares of the Fund.","page_number":63,"box":{"x":116,"y":599,"width":149,"height":9}},{"id":"ed6e9872-a322-40cf-bc98-afd091b0fadc","block_type":"box","text":"Conveyance of all notices, statements and other communications to Beneficial Owners is effected as","page_number":63,"box":{"x":117,"y":630,"width":752,"height":12}},{"id":"ba079fb0-3e22-4290-b215-3c3c08137e25","block_type":"box","text":"follows. Pursuant to the Depositary Agreement between the Trust and DTC, DTC is required to make","page_number":63,"box":{"x":116,"y":645,"width":755,"height":12}},{"id":"5808943a-748f-42bb-9303-ca9aa18cd161","block_type":"box","text":"available to the Trust upon request and for a fee to be charged to the Trust a listing of the shares of the","page_number":63,"box":{"x":116,"y":661,"width":766,"height":12}},{"id":"78b01a46-decd-405f-8f2d-4ab127356a5a","block_type":"box","text":"Fund held by each DTC Participant. The Trust shall inquire of each such DTC Participant as to the","page_number":63,"box":{"x":117,"y":676,"width":729,"height":12}},{"id":"2eba91e6-9d02-4e80-b013-5d695f6d72d4","block_type":"box","text":"number of Beneficial Owners holding shares, directly or indirectly, through such DTC Participant. The","page_number":63,"box":{"x":117,"y":692,"width":750,"height":12}},{"id":"701c94c8-5c7e-4355-ae2c-bf9474e3af66","block_type":"box","text":"Trust shall provide each such DTC Participant with copies of such notice, statement or other","page_number":63,"box":{"x":116,"y":707,"width":685,"height":12}},{"id":"e73512e4-1040-4736-a2d9-538ffb55b951","block_type":"box","text":"communication, in such form, number and at such place as such DTC Participant may reasonably","page_number":63,"box":{"x":116,"y":723,"width":727,"height":12}},{"id":"4ac364d2-6335-4ed1-bb9a-af4664fa1e6e","block_type":"box","text":"request, in order that such notice, statement or communication may be transmitted by such DTC","page_number":63,"box":{"x":117,"y":738,"width":714,"height":12}},{"id":"dcdc36b8-5ee2-43b6-956c-4a8e7bf4ad7d","block_type":"box","text":"Participant, directly or indirectly, to such Beneficial Owners. In addition, the Trust shall pay to each","page_number":63,"box":{"x":117,"y":754,"width":728,"height":12}},{"id":"dd3896ea-104b-429d-ad00-42ebf1351387","block_type":"box","text":"such DTC Participant a fair and reasonable amount as reimbursement for the expenses attendant to","page_number":63,"box":{"x":116,"y":769,"width":744,"height":12}},{"id":"d2dfb981-6d3b-45b6-a9e0-6293b89e7b8a","block_type":"box","text":"such transmittal, all subject to applicable statutory and regulatory requirements.","page_number":63,"box":{"x":116,"y":785,"width":589,"height":12}},{"id":"bc04f5e0-3bda-48f1-8703-f4e6fc66459b","block_type":"box","text":"Share distributions shall be made to DTC or its nominee, Cede & Co., as the registered holder of all","page_number":63,"box":{"x":116,"y":816,"width":739,"height":12}},{"id":"c44efbaa-9bf3-49ed-844d-56431c02fd6d","block_type":"box","text":"shares of the Trust. DTC or its nominee, upon receipt of any such distributions, shall credit immediately","page_number":63,"box":{"x":116,"y":831,"width":771,"height":12}},{"id":"552631b5-c4b2-4b86-914a-c26307c869f2","block_type":"box","text":"DTC Participants’ accounts with payments in amounts proportionate to their respective beneficial","page_number":63,"box":{"x":117,"y":847,"width":723,"height":12}},{"id":"cd76fed5-e34a-4fba-a4dc-a58191041d7d","block_type":"box","text":"interests in shares of the Fund as shown on the records of DTC or its nominee. Payments by DTC","page_number":63,"box":{"x":117,"y":862,"width":732,"height":12}},{"id":"d26ce24f-f7f1-4128-9a51-9abda08d839a","block_type":"box","text":"Participants to Indirect Participants and Beneficial Owners of shares held through such DTC","page_number":63,"box":{"x":117,"y":878,"width":687,"height":12}},{"id":"2397bebc-9f23-4189-9884-7305318f0c37","block_type":"box","text":"58","page_number":63,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"40243f0e-16d8-421b-b692-aee9f323e1c6","block_type":"box","text":"NM0926U-5926888-63/257","page_number":63,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"7493aa62-475c-455e-8177-e8b6dc55ef23","block_type":"box","text":"Participants will be governed by standing instructions and customary practices, as is now the case with","page_number":64,"box":{"x":117,"y":87,"width":768,"height":12}},{"id":"7e4f9895-1d9a-4074-91dc-b5f118f26fe1","block_type":"box","text":"securities held for the accounts of customers in bearer form or registered in a “street name,” and will be","page_number":64,"box":{"x":116,"y":102,"width":772,"height":13}},{"id":"45d14d3b-04a3-4896-b892-5f567fc5a1ac","block_type":"box","text":"the responsibility of such DTC Participants.","page_number":64,"box":{"x":116,"y":118,"width":325,"height":12}},{"id":"059ca004-a65e-43a0-88c9-50fb2515ac87","block_type":"box","text":"The Trust has no responsibility or liability for any aspect of the records relating to or notices to","page_number":64,"box":{"x":116,"y":151,"width":702,"height":12}},{"id":"069a99f3-04a2-4e9c-8df9-04fd69ff4b95","block_type":"box","text":"Beneficial Owners, or payments made on account of beneficial ownership interests in such shares, or","page_number":64,"box":{"x":117,"y":167,"width":756,"height":12}},{"id":"4ec08688-d455-4f68-80b4-d26adfc6a4a9","block_type":"box","text":"for maintaining, supervising or reviewing any records relating to such beneficial ownership interests, or","page_number":64,"box":{"x":116,"y":182,"width":766,"height":12}},{"id":"5fae26b4-2f44-45d0-be3d-86d98da81631","block_type":"box","text":"for any other aspect of the relationship between DTC and the DTC Participants or the relationship","page_number":64,"box":{"x":116,"y":198,"width":730,"height":12}},{"id":"0d64142c-f4f4-4100-8da7-c896d738cd49","block_type":"box","text":"between such DTC Participants and the Indirect Participants and Beneficial Owners owning through","page_number":64,"box":{"x":117,"y":213,"width":745,"height":12}},{"id":"ea3b4960-219e-45ac-8c76-73e71e0c84ef","block_type":"box","text":"such DTC Participants. DTC may decide to discontinue providing its service with respect to shares of","page_number":64,"box":{"x":116,"y":229,"width":755,"height":12}},{"id":"011d319b-f117-4e4a-8432-e777624f46d9","block_type":"box","text":"the Trust at any time by giving reasonable notice to the Trust and discharging its responsibilities with","page_number":64,"box":{"x":116,"y":244,"width":751,"height":12}},{"id":"1220fc5b-02e0-40c8-9ddc-ec0782f307b4","block_type":"box","text":"respect thereto under applicable law. Under such circumstances, the Trust shall take action to find a","page_number":64,"box":{"x":117,"y":260,"width":747,"height":12}},{"id":"f73599e9-7c15-4748-a1e1-a8ac2148470d","block_type":"box","text":"replacement for DTC to perform its functions at a comparable cost.","page_number":64,"box":{"x":117,"y":275,"width":500,"height":12}},{"id":"0dff76c2-e17a-4a2f-929c-0a219a8b9049","block_type":"box","text":"Distribution of Shares.","page_number":64,"box":{"x":117,"y":308,"width":178,"height":10}},{"id":"2fd9410f-a3aa-4484-898d-5dbb2ca5e662","block_type":"box","text":"In connection with the Fund’s launch, the Fund will be seeded through the","page_number":64,"box":{"x":296,"y":308,"width":559,"height":12}},{"id":"4ed4816a-9c82-47e0-9bca-7dfeaad245db","block_type":"box","text":"sale of one or more Creation Units by the Fund to one or more initial investors. Initial investors","page_number":64,"box":{"x":116,"y":324,"width":704,"height":12}},{"id":"16b8a94c-4b5b-4f6f-8532-c676c73ec244","block_type":"box","text":"participating in the seeding may be Authorized Participants, a lead market maker or other third party","page_number":64,"box":{"x":117,"y":339,"width":746,"height":12}},{"id":"3ae732f4-5c92-4f0b-bdae-5ddaefede732","block_type":"box","text":"investor or an affiliate of the Fund or the Fund’s adviser. Each such initial investor may sell some or all","page_number":64,"box":{"x":117,"y":355,"width":763,"height":12}},{"id":"d0bcaa3e-80e5-4c30-b85e-7432c0c8ba6b","block_type":"box","text":"of the shares underlying the Creation Unit(s) held by them pursuant to the registration statement for the","page_number":64,"box":{"x":116,"y":370,"width":772,"height":12}},{"id":"534f9a43-64ac-47a5-8a97-db691255eff9","block_type":"box","text":"Fund (each, a “Selling Shareholder”), which shares have been registered to permit the resale from time","page_number":64,"box":{"x":117,"y":386,"width":770,"height":12}},{"id":"20fd5102-550c-4120-a4b1-92dc78133691","block_type":"box","text":"to time after purchase. The Fund will not receive any of the proceeds from the resale by the Selling","page_number":64,"box":{"x":116,"y":401,"width":739,"height":12}},{"id":"be40d10d-77fb-435d-b926-ac71df24c4f7","block_type":"box","text":"Shareholders of these shares.","page_number":64,"box":{"x":116,"y":417,"width":229,"height":9}},{"id":"c50203ee-822d-4142-8b54-6ec6b1792c02","block_type":"box","text":"Selling Shareholders may sell shares owned by them directly or through broker-dealers, in accordance","page_number":64,"box":{"x":116,"y":450,"width":767,"height":12}},{"id":"14011351-5375-4705-bb96-c516d5d71c8e","block_type":"box","text":"with applicable law, on any national securities exchange on which the shares may be listed or quoted","page_number":64,"box":{"x":116,"y":465,"width":755,"height":12}},{"id":"53b33b56-752c-4b89-a731-13bfbb8963ff","block_type":"box","text":"at the time of sale, through trading systems, in the OTC market or in transactions other than on these","page_number":64,"box":{"x":116,"y":481,"width":756,"height":12}},{"id":"10a2e981-3ee8-4afe-8fd4-0903bc022987","block_type":"box","text":"exchanges or systems at fixed prices, at prevailing market prices at the time of the sale, at varying","page_number":64,"box":{"x":116,"y":496,"width":735,"height":12}},{"id":"541b8c85-2824-4e51-9526-86b477e0acb8","block_type":"box","text":"prices determined at the time of sale, or at negotiated prices. These sales may be effected through","page_number":64,"box":{"x":117,"y":512,"width":737,"height":12}},{"id":"2f51c5c9-8e0b-4d58-85e6-0a5176446f22","block_type":"box","text":"brokerage transactions, privately negotiated trades, block sales, entry into options or other derivatives","page_number":64,"box":{"x":117,"y":527,"width":760,"height":12}},{"id":"ea6fe240-4a3f-4386-ba13-c34e7d523ae0","block_type":"box","text":"transactions or through any other means authorized by applicable law. Selling Shareholders may","page_number":64,"box":{"x":116,"y":543,"width":724,"height":12}},{"id":"14e4e1a6-789b-4019-bd70-54a784460f38","block_type":"box","text":"redeem the shares held in Creation Unit size by them through an Authorized Participant.","page_number":64,"box":{"x":117,"y":558,"width":659,"height":12}},{"id":"d8792cd8-d7d1-46e6-9577-e21e28ffed88","block_type":"box","text":"Any Selling Shareholder and any broker-dealer or agents participating in the distribution of shares may","page_number":64,"box":{"x":116,"y":591,"width":767,"height":12}},{"id":"ae9f1323-f4e9-4d57-9314-bb773018f9b7","block_type":"box","text":"be deemed to be “underwriters” within the meaning of Section 2(a)(11) of the 1933 Act, in connection","page_number":64,"box":{"x":117,"y":607,"width":754,"height":12}},{"id":"4aade55b-9d43-4918-b886-fc4d242fcf49","block_type":"box","text":"with such sales.","page_number":64,"box":{"x":116,"y":623,"width":123,"height":9}},{"id":"e599a0a8-d98f-4b52-999e-72eb744388d8","block_type":"box","text":"Any Selling Shareholder and any other person participating in such distribution will be subject to","page_number":64,"box":{"x":116,"y":655,"width":716,"height":13}},{"id":"fb0ee9b3-1539-4189-a7b5-481a1f59c8d0","block_type":"box","text":"applicable provisions of the 1934 Act and the rules and regulations thereunder.","page_number":64,"box":{"x":116,"y":671,"width":585,"height":12}},{"id":"8c727330-4965-4d21-9a0c-2bd8a4fb5ace","block_type":"box","text":"Creation and Redemption of Creation","page_number":64,"box":{"x":118,"y":727,"width":678,"height":28}},{"id":"4e49088b-9127-49fe-9a7e-ebf628d0edc7","block_type":"box","text":"Units","page_number":64,"box":{"x":119,"y":761,"width":100,"height":22}},{"id":"afd8fc32-c33f-4589-9b78-ab118824ac77","block_type":"box","text":"General","page_number":64,"box":{"x":116,"y":815,"width":61,"height":10}},{"id":"0709f99a-d6c1-4aa6-9a7a-5f1af79645de","block_type":"box","text":". The Trust issues and sells shares of the Fund only in Creation Units on a continuous basis","page_number":64,"box":{"x":180,"y":815,"width":680,"height":12}},{"id":"7e6aa0f3-bc8f-4c7d-961e-315d67b4b9e9","block_type":"box","text":"through the Distributor or its agent, without a sales load, at a price based on the Fund’s NAV next","page_number":64,"box":{"x":116,"y":831,"width":728,"height":12}},{"id":"1a314677-b150-4179-acd0-2b7998485e41","block_type":"box","text":"determined after receipt, on any Business Day (as defined below), of an order received by the","page_number":64,"box":{"x":116,"y":846,"width":702,"height":12}},{"id":"85ac4e0a-f8a1-4aa8-a1e7-c2ce5b01606d","block_type":"box","text":"Distributor or its agent in proper form. On days when the Listing Exchange or the bond markets close","page_number":64,"box":{"x":117,"y":862,"width":754,"height":12}},{"id":"f259db19-d5f6-49ac-8907-e86131116c14","block_type":"box","text":"earlier than normal, the Fund may require orders to be placed earlier in the day. The following table","page_number":64,"box":{"x":116,"y":877,"width":742,"height":12}},{"id":"7a082e65-5a2b-4635-adb1-1d8824c5b7f7","block_type":"box","text":"59","page_number":64,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"7e3efc72-5b30-44c0-b9c5-1af2afdc196b","block_type":"box","text":"NM0926U-5926888-64/257","page_number":64,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"c8d8e309-e3a0-47a7-ab71-a3ee85ac6569","block_type":"box","text":"sets forth the number of shares of the Fund that constitute a Creation Unit for the Fund and the","page_number":65,"box":{"x":116,"y":87,"width":710,"height":10}},{"id":"a5fb907f-2a62-428d-9b64-42bbd4256049","block_type":"box","text":"approximate value of such Creation Unit as of July 31, 2026:","page_number":65,"box":{"x":116,"y":102,"width":454,"height":13}},{"id":"48b6d641-bdcc-4734-a111-9b9125e40a16","block_type":"box","text":"Fund","page_number":65,"box":{"x":117,"y":164,"width":31,"height":7}},{"id":"ced8a91c-9456-4ebb-8a08-a67bad42fc97","block_type":"box","text":"Shares Per","page_number":65,"box":{"x":686,"y":143,"width":70,"height":7}},{"id":"8ed2fe07-9d87-446a-9d6a-3b0a73e71053","block_type":"box","text":"Creation","page_number":65,"box":{"x":694,"y":153,"width":53,"height":8}},{"id":"d9873e29-d999-4a12-818f-45b37127aadf","block_type":"box","text":"Unit","page_number":65,"box":{"x":708,"y":164,"width":25,"height":7}},{"id":"28b67fe7-7da9-48aa-8086-ebff269d87a4","block_type":"box","text":"Approximate","page_number":65,"box":{"x":790,"y":133,"width":82,"height":9}},{"id":"368bdb84-2c51-4dfe-a89b-938d5402a117","block_type":"box","text":"Value Per","page_number":65,"box":{"x":800,"y":143,"width":62,"height":7}},{"id":"7ebd8cad-22d6-415c-a780-22ceff686063","block_type":"box","text":"Creation","page_number":65,"box":{"x":804,"y":153,"width":53,"height":8}},{"id":"be58852b-b1f8-4c4c-b28e-810270eb58a4","block_type":"box","text":"Unit (U.S.$)","page_number":65,"box":{"x":796,"y":163,"width":71,"height":10}},{"id":"71243848-71e2-4621-86f7-0d89d85f257f","block_type":"box","text":"iShares Securitized Income Active ETF 50,000 $2,493,384","page_number":65,"box":{"x":117,"y":182,"width":761,"height":11}},{"id":"88e76f73-ed7d-4ea9-aab7-16e3752f4960","block_type":"box","text":"In its discretion, the Trust reserves the right to increase or decrease the number of the Fund’s shares","page_number":65,"box":{"x":117,"y":215,"width":754,"height":13}},{"id":"0cdb9d00-0d71-46ae-9e39-d72934200aed","block_type":"box","text":"that constitute a Creation Unit. The Board reserves the right to declare a split or a consolidation in the","page_number":65,"box":{"x":116,"y":231,"width":759,"height":12}},{"id":"2d75fde4-38c4-4cec-abbd-73baae9a105f","block_type":"box","text":"number of shares outstanding of the Fund, and to make a corresponding change in the number of","page_number":65,"box":{"x":117,"y":246,"width":730,"height":13}},{"id":"77456fad-6328-46a3-ad28-4b38ecce43b6","block_type":"box","text":"shares constituting a Creation Unit, in the event that the per share price in the secondary market rises","page_number":65,"box":{"x":116,"y":262,"width":761,"height":12}},{"id":"84129024-b0c0-44e1-a846-5cd327a52a59","block_type":"box","text":"(or declines) to an amount that falls outside the range deemed desirable by the Board.","page_number":65,"box":{"x":117,"y":277,"width":644,"height":13}},{"id":"aab51253-b3f4-4d32-bda0-e247a5361bca","block_type":"box","text":"A “Business Day” with respect to the Fund is any day the Fund is open for business, including any day","page_number":65,"box":{"x":116,"y":311,"width":764,"height":12}},{"id":"959ff486-9bc6-4d89-8d5f-d2fdb50c92cf","block_type":"box","text":"when it satisfies redemption requests as required by Section 22(e) of the Investment Company Act.","page_number":65,"box":{"x":116,"y":326,"width":742,"height":12}},{"id":"d9eefa1d-071d-44a0-9288-62fa5ea15b7a","block_type":"box","text":"The Fund is open for business any day on which the Listing Exchange on which the Fund is listed for","page_number":65,"box":{"x":116,"y":342,"width":754,"height":12}},{"id":"7317e274-7066-4146-a9b6-8134adc8abe6","block_type":"box","text":"trading is open for business. As of the date of this SAI, the Listing Exchange observes the following","page_number":65,"box":{"x":116,"y":357,"width":742,"height":12}},{"id":"e9ba5b90-932d-43d5-8924-00bb88742125","block_type":"box","text":"holidays, as observed: New Year’s Day, Martin Luther King, Jr. Day, Presidents’ Day, Good Friday,","page_number":65,"box":{"x":117,"y":373,"width":740,"height":12}},{"id":"73b301ec-1c10-4432-99d0-44b948fcb6db","block_type":"box","text":"Memorial Day, Juneteenth, Independence Day, Labor Day, Thanksgiving Day and Christmas Day.","page_number":65,"box":{"x":117,"y":388,"width":733,"height":12}},{"id":"88a9a9a1-a8f8-49e0-843e-5b283e48a045","block_type":"box","text":"Fund Deposit.","page_number":65,"box":{"x":117,"y":422,"width":110,"height":11}},{"id":"5de3f644-ed41-4850-80f1-d2cef5ea8065","block_type":"box","text":"The consideration for purchase of Creation Units of the Fund is generally cash.","page_number":65,"box":{"x":228,"y":421,"width":596,"height":12}},{"id":"e511c010-2357-4bbd-b29f-4ecae1240c25","block_type":"box","text":"However, in some cases the consideration consists of a designated portfolio of securities, assets or","page_number":65,"box":{"x":117,"y":437,"width":742,"height":12}},{"id":"1656219c-784c-4ecf-a906-51f85a8d0cb7","block_type":"box","text":"other positions (including any portion of such securities for which cash may be substituted) (“Deposit","page_number":65,"box":{"x":116,"y":452,"width":750,"height":12}},{"id":"46efec9b-a9c0-4289-8b29-d23eac543a1d","block_type":"box","text":"Securities” or “Creation Basket”) and the Cash Component computed as described below. Together,","page_number":65,"box":{"x":116,"y":468,"width":750,"height":12}},{"id":"c06beedc-c203-4b3e-ae63-10f1cc7358da","block_type":"box","text":"the Deposit Securities and the Cash Component constitute the “Fund Deposit,” which will be applicable","page_number":65,"box":{"x":116,"y":483,"width":770,"height":12}},{"id":"685a6ab4-c2ef-4589-8d7a-1b35480c6e61","block_type":"box","text":"(subject to possible amendment or correction) to creation requests received in proper form. The Fund","page_number":65,"box":{"x":117,"y":499,"width":757,"height":12}},{"id":"661edfb8-490f-4db7-a233-72b627b76e91","block_type":"box","text":"Deposit represents the minimum initial and subsequent investment amount for a Creation Unit of the","page_number":65,"box":{"x":117,"y":514,"width":748,"height":12}},{"id":"542d91e3-da0f-4aed-8288-24ce0af81056","block_type":"box","text":"Fund. Such Fund Deposit is applicable, subject to any adjustments as described below, to purchases","page_number":65,"box":{"x":117,"y":530,"width":755,"height":12}},{"id":"8c8bac38-6f43-432c-aa06-1442cd780897","block_type":"box","text":"of Creation Units of shares of a given Fund until such time as the next-announced Fund Deposit is","page_number":65,"box":{"x":116,"y":545,"width":734,"height":12}},{"id":"50efb092-184e-4d10-b8e0-4b8bbdff7953","block_type":"box","text":"made available.","page_number":65,"box":{"x":117,"y":561,"width":121,"height":9}},{"id":"ae0473c7-8f7f-4ff8-b0f1-36181802de05","block_type":"box","text":"The “Cash Component” is an amount equal to the difference between the NAV of the shares (per","page_number":65,"box":{"x":116,"y":594,"width":725,"height":12}},{"id":"321f16ba-e932-4b90-bbe5-cc8da37d6f1e","block_type":"box","text":"Creation Unit) and the “Deposit Amount,” which is an amount equal to the market value of the Deposit","page_number":65,"box":{"x":117,"y":610,"width":760,"height":12}},{"id":"f9b96929-7f91-4bad-8e69-fc35b5cf9cc9","block_type":"box","text":"Securities, and serves to compensate for any differences between the NAV per Creation Unit and the","page_number":65,"box":{"x":116,"y":625,"width":757,"height":12}},{"id":"94a005e1-110c-49e6-82c9-3349c9120f9b","block_type":"box","text":"Deposit Amount. Payment of any stamp duty or other similar fees and expenses payable upon transfer","page_number":65,"box":{"x":117,"y":641,"width":766,"height":12}},{"id":"63c78031-5097-423a-ac11-78261182f104","block_type":"box","text":"of beneficial ownership of the Deposit Securities are the sole responsibility of the Authorized","page_number":65,"box":{"x":116,"y":656,"width":689,"height":12}},{"id":"5b0e5111-2638-4a9b-beaa-f45ce1b233b4","block_type":"box","text":"Participant purchasing the Creation Unit.","page_number":65,"box":{"x":117,"y":672,"width":299,"height":12}},{"id":"3c5faacd-f906-4763-b945-6a35af0bd757","block_type":"box","text":"The Fund’s current policy is to accept cash in substitution for the Deposit Securities it might otherwise","page_number":65,"box":{"x":116,"y":705,"width":754,"height":12}},{"id":"cb84ed30-e109-4444-9d86-674b8d017d7a","block_type":"box","text":"accept as in-kind consideration for the purchase of Creation Units. The Fund may, at times, elect to","page_number":65,"box":{"x":116,"y":720,"width":737,"height":12}},{"id":"320e1423-bd71-43dd-8054-a020f5a8105d","block_type":"box","text":"receive Deposit Securities (","page_number":65,"box":{"x":117,"y":736,"width":203,"height":12}},{"id":"333fc5d1-9a81-4eab-8eee-4f0bc0e0bf98","block_type":"box","text":"i.e.","page_number":65,"box":{"x":321,"y":736,"width":20,"height":9}},{"id":"fa2c7652-6c04-4d98-bc28-28628cade465","block_type":"box","text":", the in-kind deposit of a designated portfolio of securities) and a Cash","page_number":65,"box":{"x":344,"y":736,"width":519,"height":12}},{"id":"b554a8e6-456a-4cf9-9541-c86ff5bba01b","block_type":"box","text":"Component as consideration for the purchase of Creation Units. If the Fund elects to accept Deposit","page_number":65,"box":{"x":117,"y":751,"width":743,"height":12}},{"id":"f4f3b5c7-4239-490a-b9b0-bd8826bb89dd","block_type":"box","text":"Securities, a purchaser’s delivery of the Deposit Securities together with the Cash Component will","page_number":65,"box":{"x":116,"y":767,"width":725,"height":12}},{"id":"0f36c06f-4bb3-492c-910b-1afef1ff2853","block_type":"box","text":"constitute the “Fund Deposit,” which will represent the consideration for a Creation Unit of the Fund.","page_number":65,"box":{"x":116,"y":782,"width":739,"height":12}},{"id":"7fbbdb1b-f6b4-488a-91b3-456a73299f52","block_type":"box","text":"Please see the","page_number":65,"box":{"x":117,"y":798,"width":109,"height":9}},{"id":"d4c6bb0a-e9ae-42f2-8743-9de9070a8a87","block_type":"box","text":"Cash Purchase Method","page_number":65,"box":{"x":233,"y":798,"width":175,"height":9}},{"id":"a272a335-c1cd-4ac0-8836-f49afc961821","block_type":"box","text":"section below and the following discussion summarizing the","page_number":65,"box":{"x":413,"y":798,"width":443,"height":12}},{"id":"d5d94392-13b1-47b6-b942-5dcde156a211","block_type":"box","text":"Deposit Security method for further information on purchasing Creation Units of the Fund.","page_number":65,"box":{"x":117,"y":813,"width":663,"height":12}},{"id":"2b8959df-a61a-4e2b-ac70-88c5c662c668","block_type":"box","text":"The Deposit Securities, in connection with a purchase of a Creation Unit of the Fund, will consist of a","page_number":65,"box":{"x":116,"y":847,"width":753,"height":12}},{"id":"775e83ee-4b66-4687-a003-2c764c6a4274","block_type":"box","text":"pro rata basket of the Fund’s portfolio except for differences due to minimum trading sizes for bonds,","page_number":65,"box":{"x":117,"y":862,"width":751,"height":12}},{"id":"d25892d4-5765-4952-9622-eadd2757c96b","block_type":"box","text":"minimum lot sizes or rounding.","page_number":65,"box":{"x":117,"y":878,"width":232,"height":12}},{"id":"5a2fb8f2-929c-4a39-ba2c-bf4fd2796e47","block_type":"box","text":"60","page_number":65,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"1b5bbf43-6fa3-4d40-b349-6ec46f026c55","block_type":"box","text":"NM0926U-5926888-65/257","page_number":65,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"316d41b0-1abf-406b-a8cd-27c0815325a3","block_type":"box","text":"The identity and number or par value of the Deposit Securities change pursuant to changes in the","page_number":66,"box":{"x":116,"y":87,"width":730,"height":12}},{"id":"82920710-789c-4689-88c1-cbc14c35a056","block_type":"box","text":"composition of the Fund’s portfolio and as rebalancing adjustments and corporate action events are","page_number":66,"box":{"x":116,"y":102,"width":744,"height":13}},{"id":"31555f7a-b96e-4336-b6be-0c4bc026c0d3","block_type":"box","text":"reflected from time to time by BFA with a view to the investment objective of the Fund. The","page_number":66,"box":{"x":117,"y":118,"width":677,"height":12}},{"id":"c99844c1-c615-473d-ae1b-cb09b158d7ef","block_type":"box","text":"composition of the Deposit Securities may also change in response to adjustments to the weighting or","page_number":66,"box":{"x":116,"y":134,"width":761,"height":12}},{"id":"30f14985-78ba-4084-866a-ef902c79e535","block_type":"box","text":"composition of the component securities constituting the Fund’s portfolio.","page_number":66,"box":{"x":116,"y":149,"width":547,"height":12}},{"id":"91df86c6-f373-4e53-876b-883cc7dc5b11","block_type":"box","text":"The Fund Deposit may also be modified to minimize the Cash Component by redistributing the cash to","page_number":66,"box":{"x":116,"y":180,"width":766,"height":12}},{"id":"fbfa22b3-c323-4457-a147-52333442fcd6","block_type":"box","text":"the Deposit Securities portion of the Fund Deposit through “systematic rounding.” The rounding","page_number":66,"box":{"x":116,"y":196,"width":712,"height":12}},{"id":"82d04894-9bb5-472d-9ee4-68a60bd77ac1","block_type":"box","text":"methodology “rounds up” position sizes of securities in the Deposit Securities (which in turn reduces","page_number":66,"box":{"x":117,"y":211,"width":746,"height":12}},{"id":"f351cc22-645e-4f0d-88a8-288a8de5e19c","block_type":"box","text":"the cash portion). However, the methodology limits the maximum allowed percentage change in weight","page_number":66,"box":{"x":116,"y":227,"width":770,"height":12}},{"id":"61471c9e-210e-4cac-a5cc-c043570e848f","block_type":"box","text":"and share quantity of any given security in the Fund Deposit.","page_number":66,"box":{"x":116,"y":242,"width":456,"height":12}},{"id":"b304fffe-6db6-413d-b0a7-3becba69c268","block_type":"box","text":"The Trust may, in its sole discretion, substitute a “cash in lieu” amount to be added to the Cash","page_number":66,"box":{"x":116,"y":273,"width":710,"height":12}},{"id":"cd211f15-ec43-4d5d-80de-67de63b51ae0","block_type":"box","text":"Component to replace any Deposit Security in certain circumstances, including: (i) when instruments","page_number":66,"box":{"x":117,"y":289,"width":750,"height":12}},{"id":"8c3cf45d-205a-461d-989f-04fb13ec4ffb","block_type":"box","text":"are not available in sufficient quantity for delivery; (ii) when instruments are not eligible for transfer","page_number":66,"box":{"x":116,"y":304,"width":732,"height":12}},{"id":"a798ac04-b908-4709-80b5-b75eedd9cbf3","block_type":"box","text":"through DTC or the clearing process (as discussed below); (iii) when instruments that the Authorized","page_number":66,"box":{"x":116,"y":320,"width":752,"height":12}},{"id":"e9ada9f6-fa97-47e9-a850-892ee7474d30","block_type":"box","text":"Participant (or an investor on whose behalf the Authorized Participant is acting) are not able to be","page_number":66,"box":{"x":117,"y":335,"width":728,"height":12}},{"id":"e67aa7a5-445c-48d8-85db-3de58cbfd45e","block_type":"box","text":"traded due to a trading restriction; (iv) when delivery of the Deposit Security by the Authorized","page_number":66,"box":{"x":116,"y":351,"width":702,"height":12}},{"id":"940ce814-bafb-409d-b10a-3c5562a94abf","block_type":"box","text":"Participant (or by an investor on whose behalf the Authorized Participant is acting) would be restricted","page_number":66,"box":{"x":117,"y":366,"width":760,"height":12}},{"id":"47920420-b6a3-486f-9602-f71a77f786eb","block_type":"box","text":"under applicable securities or other local laws; (v) in connection with distribution payments to be made","page_number":66,"box":{"x":117,"y":382,"width":763,"height":12}},{"id":"870516d4-9055-4f0e-adb1-e4786d6f23c0","block_type":"box","text":"by the Fund; or (vi) in certain other situations.","page_number":66,"box":{"x":117,"y":397,"width":341,"height":12}},{"id":"2dda86c1-63c8-470b-a317-c1e5d637a82c","block_type":"box","text":"Cash Purchase Method.","page_number":66,"box":{"x":116,"y":428,"width":189,"height":10}},{"id":"08af3f5b-ece8-480d-b060-236a9cb92182","block_type":"box","text":"Although the Trust does not generally permit partial or full cash purchases of","page_number":66,"box":{"x":306,"y":428,"width":579,"height":12}},{"id":"b553bcf2-1e42-49a2-b1f8-1dca6598da23","block_type":"box","text":"Creation Units of its funds, when partial or full cash purchases of Creation Units are available or","page_number":66,"box":{"x":117,"y":444,"width":714,"height":12}},{"id":"5f292c61-8e7d-43f6-bdfa-f696797e058f","block_type":"box","text":"specified (Creation Units of the Fund are generally offered solely for cash), they will be effected in","page_number":66,"box":{"x":116,"y":459,"width":730,"height":12}},{"id":"ffa50b2f-44bb-424f-9c02-082bf9438a0d","block_type":"box","text":"essentially the same manner as in-kind purchases thereof. In the case of a partial or full cash","page_number":66,"box":{"x":116,"y":475,"width":696,"height":12}},{"id":"b7e74468-a06a-43d1-96ef-c72364c70c87","block_type":"box","text":"purchase, the Authorized Participant must pay the cash equivalent of the Deposit Securities it would","page_number":66,"box":{"x":117,"y":490,"width":746,"height":12}},{"id":"58690e18-937e-477e-b216-f760e84b4d9a","block_type":"box","text":"otherwise be required to provide through an in-kind purchase, plus the same Cash Component","page_number":66,"box":{"x":116,"y":506,"width":708,"height":12}},{"id":"11f26719-723f-4da2-8c71-5210974aa71a","block_type":"box","text":"required to be paid by an in-kind purchaser.","page_number":66,"box":{"x":117,"y":521,"width":328,"height":12}},{"id":"266ffa98-356e-46d2-9ea8-60f4b7d88981","block_type":"box","text":"Procedures for Creation of Creation Units.","page_number":66,"box":{"x":117,"y":552,"width":335,"height":10}},{"id":"6a843025-3c25-4e9f-8fad-3c60c43b29f9","block_type":"box","text":"To be eligible to place orders with the Distributor and to","page_number":66,"box":{"x":453,"y":552,"width":421,"height":12}},{"id":"0601f858-c532-4cae-beb6-4d6619cc4c93","block_type":"box","text":"create a Creation Unit of the Fund, an entity must be: (i) a “Participating Party,” i.e., a broker-dealer or","page_number":66,"box":{"x":116,"y":568,"width":762,"height":12}},{"id":"a57c1e80-f14e-475d-b41d-766a6e4c6a1a","block_type":"box","text":"other participant in the clearing process through the Continuous Net Settlement System of the NSCC","page_number":66,"box":{"x":116,"y":583,"width":754,"height":12}},{"id":"75ca4ec2-6515-4ef7-9367-6a800048b3fe","block_type":"box","text":"(the “Clearing Process”), a clearing agency that is registered with the SEC, or (ii) a DTC Participant,","page_number":66,"box":{"x":117,"y":599,"width":744,"height":12}},{"id":"b14ab694-4e99-4720-a0f3-e77aac325a19","block_type":"box","text":"and must have executed an agreement with the Distributor, with respect to creations and redemptions","page_number":66,"box":{"x":116,"y":614,"width":762,"height":12}},{"id":"d0962c07-623c-48a8-91ec-50af5376026e","block_type":"box","text":"of Creation Units (“Authorized Participant Agreement”) (discussed below). A member or participant of a","page_number":66,"box":{"x":116,"y":630,"width":770,"height":12}},{"id":"9820e57b-8583-4a3f-a0df-b99c481c7938","block_type":"box","text":"clearing agency registered with the SEC which has a written agreement with the Fund or one of its","page_number":66,"box":{"x":116,"y":645,"width":735,"height":12}},{"id":"e955b3be-2642-43cf-a5f0-cf738846db18","block_type":"box","text":"service providers that allows such member or participant to place orders for the purchase and","page_number":66,"box":{"x":116,"y":661,"width":694,"height":12}},{"id":"7483964e-31db-48cd-8bc6-315c99e29001","block_type":"box","text":"redemption of Creation Units is referred to as an “Authorized Participant.” All shares of the Fund,","page_number":66,"box":{"x":117,"y":676,"width":715,"height":12}},{"id":"310552a0-63a5-4bc8-a115-b3f74d7b0384","block_type":"box","text":"however created, will be entered on the records of DTC in the name of Cede & Co. for the account of a","page_number":66,"box":{"x":117,"y":692,"width":763,"height":11}},{"id":"7a43b909-3ec2-4bf0-ae81-d6e2301e2816","block_type":"box","text":"DTC Participant.","page_number":66,"box":{"x":117,"y":707,"width":121,"height":12}},{"id":"46f44822-f557-4098-975e-4855afe9841c","block_type":"box","text":"Role of the Authorized Participant.","page_number":66,"box":{"x":117,"y":738,"width":274,"height":12}},{"id":"132bb4a1-e2b3-42cc-97cf-ecac7f2b7c56","block_type":"box","text":"Creation Units may be purchased only by or through a member","page_number":66,"box":{"x":397,"y":738,"width":469,"height":12}},{"id":"d6519fb8-58c0-412e-840f-fe87522280fa","block_type":"box","text":"or participant of a clearing agency registered with the SEC, which has a written agreement with the","page_number":66,"box":{"x":116,"y":754,"width":734,"height":12}},{"id":"2a5f0984-2fb3-4b0b-bb00-6c5691af34e1","block_type":"box","text":"Fund or one of its service providers that allows such member or participant to place orders for the","page_number":66,"box":{"x":117,"y":769,"width":723,"height":12}},{"id":"bf8e7c5f-1b8d-4ca1-abc5-77531410d6f0","block_type":"box","text":"purchase and redemption of Creation Units. Such Authorized Participant will agree, pursuant to the","page_number":66,"box":{"x":117,"y":785,"width":734,"height":12}},{"id":"186d185a-9223-4693-a51e-5d4f9ead0423","block_type":"box","text":"terms of such Authorized Participant Agreement and on behalf of itself or any investor on whose behalf","page_number":66,"box":{"x":116,"y":800,"width":765,"height":12}},{"id":"0abafb9e-8c3d-48a2-ba40-f887626eee44","block_type":"box","text":"it will act, to certain conditions, including that such Authorized Participant will make available in","page_number":66,"box":{"x":117,"y":816,"width":701,"height":12}},{"id":"00669570-c773-4ed9-b283-10630f3b7d46","block_type":"box","text":"advance of each purchase of shares an amount of cash sufficient to pay the Cash Component, once","page_number":66,"box":{"x":116,"y":831,"width":750,"height":12}},{"id":"7274033e-dffa-4401-a97f-43757688d010","block_type":"box","text":"the NAV of a Creation Unit is next determined after receipt of the purchase order in proper form,","page_number":66,"box":{"x":116,"y":847,"width":718,"height":12}},{"id":"8e6799cb-4869-458f-9284-d419dfdfc5db","block_type":"box","text":"together with the transaction fees described below. An Authorized Participant, acting on behalf of an","page_number":66,"box":{"x":116,"y":862,"width":748,"height":12}},{"id":"acb6a9fd-39d2-4141-b9bd-c0121e6fe3f2","block_type":"box","text":"investor, may require the investor to enter into an agreement with such Authorized Participant with","page_number":66,"box":{"x":117,"y":878,"width":733,"height":12}},{"id":"2065bd3b-08dc-4efa-b3f4-33cad148e340","block_type":"box","text":"61","page_number":66,"box":{"x":491,"y":909,"width":15,"height":9}},{"id":"299597ad-92ae-49c0-ac08-696a17bfcd2e","block_type":"box","text":"NM0926U-5926888-66/257","page_number":66,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"109c47ef-6dfa-4fae-a97e-ec207e0aa946","block_type":"box","text":"respect to certain matters, including payment of the Cash Component. Investors who are not","page_number":67,"box":{"x":117,"y":87,"width":691,"height":12}},{"id":"fb50ef50-a5d2-467b-a935-e687f63f5a93","block_type":"box","text":"Authorized Participants must make appropriate arrangements with an Authorized Participant. Investors","page_number":67,"box":{"x":116,"y":103,"width":768,"height":12}},{"id":"37725679-0330-4cff-bef5-7291e54d876e","block_type":"box","text":"should be aware that their particular broker may not be a DTC Participant or may not have executed an","page_number":67,"box":{"x":116,"y":118,"width":772,"height":12}},{"id":"7d83ac1d-c192-4fa5-a0f6-df3b101b4fcc","block_type":"box","text":"Authorized Participant Agreement and that orders to purchase Creation Units may have to be placed","page_number":67,"box":{"x":116,"y":134,"width":752,"height":12}},{"id":"25947cce-f5cb-4a31-b412-ce7dd147232b","block_type":"box","text":"by the investor’s broker through an Authorized Participant. As a result, purchase orders placed through","page_number":67,"box":{"x":117,"y":149,"width":768,"height":12}},{"id":"9483708d-131d-454b-a267-baa8caf5a701","block_type":"box","text":"an Authorized Participant may result in additional charges to such investor. The Trust does not expect","page_number":67,"box":{"x":116,"y":165,"width":761,"height":12}},{"id":"518c6050-b2e9-40f5-926c-3d8cca22e190","block_type":"box","text":"to enter into an Authorized Participant Agreement with more than a small number of DTC Participants.","page_number":67,"box":{"x":116,"y":180,"width":763,"height":12}},{"id":"37a5f3b8-ba2c-47e0-b463-a5dbbf529c57","block_type":"box","text":"A list of current Authorized Participants may be obtained from the Distributor. The Distributor has","page_number":67,"box":{"x":116,"y":196,"width":723,"height":12}},{"id":"cd2133b6-625c-4bcb-86f7-41ea050347ad","block_type":"box","text":"adopted guidelines regarding Authorized Participants’ transactions in Creation Units that are made","page_number":67,"box":{"x":116,"y":211,"width":736,"height":12}},{"id":"64e31b35-ef8e-44f6-990c-0bef9a951c8d","block_type":"box","text":"available to all Authorized Participants. These guidelines set forth the processes and standards for","page_number":67,"box":{"x":116,"y":227,"width":736,"height":12}},{"id":"8d17dd8c-5eb1-4301-856e-0cb4510ed0ea","block_type":"box","text":"Authorized Participants to transact with the Distributor and its agents in connection with creation and","page_number":67,"box":{"x":116,"y":242,"width":750,"height":12}},{"id":"074f8613-a9b6-4543-8f83-05d877711232","block_type":"box","text":"redemption transactions. In addition, the Distributor may be appointed as the proxy of the Authorized","page_number":67,"box":{"x":117,"y":258,"width":751,"height":12}},{"id":"b83fbcfb-fabe-41fb-afff-94f94ba92f3d","block_type":"box","text":"Participant and may be granted a power of attorney under its Authorized Participant Agreement.","page_number":67,"box":{"x":117,"y":273,"width":716,"height":12}},{"id":"2f003cd3-242e-405b-a947-04821c21dd00","block_type":"box","text":"Placement of Creation Orders.","page_number":67,"box":{"x":117,"y":304,"width":240,"height":10}},{"id":"6984df6f-4820-4b7b-89f6-4b20d4f0c901","block_type":"box","text":"Fund Deposits must be delivered through the Federal Reserve","page_number":67,"box":{"x":358,"y":304,"width":474,"height":12}},{"id":"0481c8d3-b168-4015-97c4-0b9e4274a6fd","block_type":"box","text":"System (for cash and U.S. government securities), through DTC (for corporate and municipal","page_number":67,"box":{"x":116,"y":320,"width":696,"height":12}},{"id":"116ba024-d0ef-4dd2-a945-3ad9eee73655","block_type":"box","text":"securities) or through a central depository account, such as with Euroclear or DTC, maintained by","page_number":67,"box":{"x":116,"y":335,"width":730,"height":12}},{"id":"049b5ccf-3a0d-422e-a2f6-ace715831e52","block_type":"box","text":"JPMorgan or a sub-custodian (a “Central Depository Account”). Any portion of a Fund Deposit that may","page_number":67,"box":{"x":116,"y":351,"width":772,"height":12}},{"id":"1c395bf1-4f13-4ca5-bb39-4d428c2be59e","block_type":"box","text":"not be delivered through the Federal Reserve System or DTC must be delivered through a Central","page_number":67,"box":{"x":117,"y":366,"width":734,"height":12}},{"id":"7739d046-535e-4ba2-aee4-c5254b73f9a2","block_type":"box","text":"Depository Account. The Fund Deposit transfers made through DTC must be ordered by the DTC","page_number":67,"box":{"x":117,"y":382,"width":728,"height":12}},{"id":"e627eed5-e90c-4e07-9b3d-f7359e7ffbf6","block_type":"box","text":"Participant in a timely fashion so as to ensure the delivery of the requisite number of Deposit Securities","page_number":67,"box":{"x":117,"y":397,"width":769,"height":12}},{"id":"0553a53e-aadb-4061-9980-7809b4085adc","block_type":"box","text":"through DTC to the account of the Fund generally before 3:00 p.m., Eastern time on the Settlement","page_number":67,"box":{"x":116,"y":413,"width":742,"height":12}},{"id":"110dee3e-413e-474e-9844-d86ddfa989bd","block_type":"box","text":"Date. Fund Deposit transfers made through the Federal Reserve System must be deposited by the","page_number":67,"box":{"x":117,"y":428,"width":738,"height":12}},{"id":"6946fb0e-4497-4a87-add5-dd9666cffe61","block_type":"box","text":"participant institution in a timely fashion so as to ensure the delivery of the requisite number or amount","page_number":67,"box":{"x":117,"y":444,"width":764,"height":12}},{"id":"0ef87d15-05b4-46bb-98ea-652e1f2f8b9b","block_type":"box","text":"of Deposit Securities or cash through the Federal Reserve System to the account of the Fund generally","page_number":67,"box":{"x":116,"y":459,"width":772,"height":12}},{"id":"3fcdbc85-cff4-486d-b14c-2f9361bd077c","block_type":"box","text":"before 3:00 p.m., Eastern time on the Settlement Date. Fund Deposit transfers made through a Central","page_number":67,"box":{"x":117,"y":475,"width":768,"height":12}},{"id":"8675e4a4-110c-467f-94f3-e870fc1bc423","block_type":"box","text":"Depository Account must be completed pursuant to the requirements established by the custodian or","page_number":67,"box":{"x":117,"y":490,"width":753,"height":12}},{"id":"4a1c7cfb-7ca5-4a6b-8bb4-8324b75746af","block_type":"box","text":"sub-custodian for such Central Depository Account generally before 2:00 p.m., Eastern time on the","page_number":67,"box":{"x":116,"y":506,"width":739,"height":12}},{"id":"09cbcd20-5b04-49a9-bc4c-ac95e2870d7b","block_type":"box","text":"Settlement Date. The “Settlement Date” for all funds is generally the first business day after the","page_number":67,"box":{"x":116,"y":521,"width":711,"height":12}},{"id":"f4825a82-36e3-41cc-9941-36c865e035f5","block_type":"box","text":"Transmittal Date. All questions as to the number of Deposit Securities to be delivered, and the validity,","page_number":67,"box":{"x":116,"y":537,"width":764,"height":12}},{"id":"3c6ac984-6300-40d2-9a9f-696f516d016c","block_type":"box","text":"form and eligibility (including time of receipt) for the deposit of any tendered securities, will be","page_number":67,"box":{"x":116,"y":552,"width":697,"height":12}},{"id":"c16706d0-1a29-48b5-bb81-42e367b3e1f7","block_type":"box","text":"determined by the Trust, whose determination shall be final and binding. The amount of cash equal to","page_number":67,"box":{"x":116,"y":568,"width":759,"height":12}},{"id":"207d51cb-7aa4-42c9-85ae-88ec895d5ca5","block_type":"box","text":"the Cash Component must be transferred directly to JPMorgan through the Federal Reserve Bank wire","page_number":67,"box":{"x":116,"y":583,"width":770,"height":12}},{"id":"5e7c3bf6-2404-4567-adef-b8f5ea37be7c","block_type":"box","text":"transfer system in a timely manner so as to be received by JPMorgan generally before 3:00 p.m.,","page_number":67,"box":{"x":116,"y":599,"width":726,"height":12}},{"id":"95080b9c-3962-4a01-a1b3-af30dd82fac8","block_type":"box","text":"Eastern time on the Settlement Date. If the Cash Component and the Deposit Securities are not","page_number":67,"box":{"x":117,"y":614,"width":716,"height":12}},{"id":"55fc075b-771e-435c-8a70-4c5bdc46c40a","block_type":"box","text":"received by 3:00 p.m., Eastern time on the Settlement Date, the creation order may be canceled. Upon","page_number":67,"box":{"x":117,"y":630,"width":768,"height":12}},{"id":"32c02492-8b67-4c7b-bc05-11e305f20e91","block_type":"box","text":"written notice to the Distributor, such canceled order may be resubmitted the following Business Day","page_number":67,"box":{"x":116,"y":645,"width":751,"height":12}},{"id":"38172ffc-bdda-4b60-a7ec-890cffdea288","block_type":"box","text":"using the Fund Deposit as newly constituted to reflect the then current NAV of the Fund. The delivery","page_number":67,"box":{"x":117,"y":661,"width":750,"height":12}},{"id":"91599570-1dd0-43e3-84c2-840d4ef7c050","block_type":"box","text":"of Creation Units so created generally will occur no later than the first Business Day following the day","page_number":67,"box":{"x":116,"y":676,"width":751,"height":12}},{"id":"42002cb0-d235-4293-91b4-abdb759ae067","block_type":"box","text":"on which the purchase order is deemed received by the Distributor, provided that the relevant Fund","page_number":67,"box":{"x":116,"y":692,"width":736,"height":12}},{"id":"85f3abcc-3ed0-4f52-b93b-8d0b1388cb73","block_type":"box","text":"Deposit has been received by the Fund prior to such time.","page_number":67,"box":{"x":117,"y":707,"width":429,"height":12}},{"id":"6823e7a6-ce0e-4571-9a75-00d3a0edfb94","block_type":"box","text":"Purchase Orders.","page_number":67,"box":{"x":117,"y":738,"width":138,"height":10}},{"id":"80638d98-9db3-4ea3-ac28-e4e6c05bb42a","block_type":"box","text":"To initiate an order for a Creation Unit, an Authorized Participant must submit to the","page_number":67,"box":{"x":261,"y":738,"width":621,"height":12}},{"id":"8e456171-7778-4f8c-aecd-db74ca0f067c","block_type":"box","text":"Distributor or its agent an irrevocable order to purchase shares of the Fund, in proper form, generally","page_number":67,"box":{"x":117,"y":754,"width":747,"height":12}},{"id":"fb2f9546-8d21-44c7-ba56-c654f9460e28","block_type":"box","text":"before 4:00 p.m., Eastern time on any Business Day to receive that day’s NAV. The Distributor or its","page_number":67,"box":{"x":117,"y":769,"width":742,"height":12}},{"id":"ba9ac8e5-5e93-4325-a7f4-e23377d97332","block_type":"box","text":"agent will notify BFA and the custodian of such order. The custodian will then provide such information","page_number":67,"box":{"x":116,"y":785,"width":760,"height":12}},{"id":"42ecbb50-958c-42af-bca8-90bb15050845","block_type":"box","text":"to any appropriate sub-custodian. Procedures and requirements governing the delivery of the Fund","page_number":67,"box":{"x":116,"y":800,"width":734,"height":12}},{"id":"36143c84-0ce1-4452-83d3-61293da5866f","block_type":"box","text":"Deposit are set forth in the procedures handbook for Authorized Participants and may change from","page_number":67,"box":{"x":117,"y":816,"width":732,"height":12}},{"id":"57e0f2e0-4613-418f-bb3b-231ae5dd5056","block_type":"box","text":"time to time. Investors, other than Authorized Participants, are responsible for making arrangements","page_number":67,"box":{"x":116,"y":831,"width":749,"height":12}},{"id":"58755944-b085-419a-b964-03f647c0e091","block_type":"box","text":"for a creation request to be made through an Authorized Participant. The Distributor or its agent will","page_number":67,"box":{"x":116,"y":847,"width":743,"height":12}},{"id":"a683458d-9e78-489b-b17f-f9f5254ec017","block_type":"box","text":"provide a list of current Authorized Participants upon request. Those placing orders to purchase","page_number":67,"box":{"x":117,"y":862,"width":714,"height":12}},{"id":"fc60e799-4e70-4307-aeb1-09da82613d20","block_type":"box","text":"62","page_number":67,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"0824731a-e25f-43c5-83e8-0ad214d6fee1","block_type":"box","text":"NM0926U-5926888-67/257","page_number":67,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"f264e66d-f2d9-425e-a72b-0ef3c26f66c4","block_type":"box","text":"Creation Units through an Authorized Participant should allow sufficient time to permit proper","page_number":68,"box":{"x":117,"y":87,"width":693,"height":12}},{"id":"94504875-bd55-47e1-9dfa-833410ed3139","block_type":"box","text":"submission of the purchase order to the Distributor or its agent by the Cutoff Time (as defined below)","page_number":68,"box":{"x":116,"y":102,"width":754,"height":13}},{"id":"ebf7582b-aad2-4f3c-a0a7-9696f3b920ac","block_type":"box","text":"on such Business Day.","page_number":68,"box":{"x":116,"y":118,"width":175,"height":12}},{"id":"e277b22d-c196-4ecc-9446-6004e3b1e957","block_type":"box","text":"The Authorized Participant must also make available on or before the contractual settlement date, by","page_number":68,"box":{"x":116,"y":146,"width":754,"height":12}},{"id":"18135b79-62e2-4283-a924-9824e462c66f","block_type":"box","text":"means satisfactory to the Fund, immediately available or same day funds estimated by the Fund to be","page_number":68,"box":{"x":117,"y":162,"width":761,"height":12}},{"id":"915f447c-429e-4945-b158-a5247dea007e","block_type":"box","text":"sufficient to pay the Cash Component next determined after acceptance of the purchase order,","page_number":68,"box":{"x":116,"y":177,"width":709,"height":12}},{"id":"d931c75f-c687-42a5-a1ca-5838ea879c41","block_type":"box","text":"together with the applicable purchase transaction fees. Those placing orders should ascertain the","page_number":68,"box":{"x":116,"y":193,"width":728,"height":12}},{"id":"e067c025-9f67-40eb-bc12-dad874b3a53e","block_type":"box","text":"deadline for cash transfers by contacting the operations department of the broker or depositary","page_number":68,"box":{"x":116,"y":208,"width":709,"height":12}},{"id":"aabe264a-6c08-40fd-bce0-4be7189d9a6e","block_type":"box","text":"institution effectuating the transfer of the Cash Component. This deadline is likely to be significantly","page_number":68,"box":{"x":117,"y":224,"width":741,"height":12}},{"id":"c287d525-3900-49d7-b653-72819d417dbe","block_type":"box","text":"earlier than the Cutoff Time of the Fund. Investors should be aware that an Authorized Participant may","page_number":68,"box":{"x":116,"y":239,"width":766,"height":12}},{"id":"2860ec86-7193-46c8-b03d-dd1020963a46","block_type":"box","text":"require orders for purchases of shares placed with it to be in the particular form required by the","page_number":68,"box":{"x":117,"y":255,"width":708,"height":12}},{"id":"cf3c9e77-bddf-4846-9a15-9516fe1422ef","block_type":"box","text":"individual Authorized Participant.","page_number":68,"box":{"x":117,"y":271,"width":247,"height":11}},{"id":"a94d7744-2bc9-4d39-976d-c04ec5d9cf87","block_type":"box","text":"The Authorized Participant is responsible for any and all expenses and costs incurred by the Fund,","page_number":68,"box":{"x":116,"y":299,"width":738,"height":12}},{"id":"3182e9b2-d789-4028-b329-14f1a5e26a6b","block_type":"box","text":"including any applicable cash amounts, in connection with any purchase order.","page_number":68,"box":{"x":117,"y":314,"width":589,"height":12}},{"id":"d52fed9a-339f-49d9-a75a-b8920dc78e7b","block_type":"box","text":"Timing of Submission of Purchase Orders.","page_number":68,"box":{"x":116,"y":343,"width":346,"height":12}},{"id":"abae026f-7ab8-48fe-a14b-f5caa9744436","block_type":"box","text":"An Authorized Participant must submit an irrevocable","page_number":68,"box":{"x":462,"y":343,"width":400,"height":12}},{"id":"42a6b738-cca8-40e8-aff1-9ef5767759a5","block_type":"box","text":"order to purchase shares of the Fund generally before 4:00 p.m., Eastern time on any Business Day in","page_number":68,"box":{"x":116,"y":358,"width":766,"height":12}},{"id":"6fbc8ceb-c999-4fc1-9118-7275d214823b","block_type":"box","text":"order to receive that day’s NAV. Creation Orders must be transmitted by an Authorized Participant in","page_number":68,"box":{"x":116,"y":374,"width":752,"height":12}},{"id":"60c310a9-a088-4711-a286-4a7d37ae86de","block_type":"box","text":"the form required by the Fund to the Distributor or its agent pursuant to procedures set forth in the","page_number":68,"box":{"x":116,"y":389,"width":732,"height":12}},{"id":"d8f42781-6ceb-4602-afdb-96b78378d1df","block_type":"box","text":"Authorized Participant Agreement. Economic or market disruptions or changes, or telephone or other","page_number":68,"box":{"x":116,"y":405,"width":755,"height":12}},{"id":"fadd8fe0-cedd-497e-82ab-110f2a24c8b9","block_type":"box","text":"communication failure, may impede the ability to reach the Distributor or its agent or an Authorized","page_number":68,"box":{"x":116,"y":420,"width":736,"height":12}},{"id":"e8b44313-249e-4859-a4fe-ecead02ea896","block_type":"box","text":"Participant. Orders to create shares of the Fund that are submitted on the Business Day immediately","page_number":68,"box":{"x":117,"y":436,"width":752,"height":12}},{"id":"228c15ea-2ffe-4f8f-898a-330e9886aa34","block_type":"box","text":"preceding a holiday or a day (other than a weekend) when the equity markets in the relevant non-U.S.","page_number":68,"box":{"x":117,"y":451,"width":761,"height":12}},{"id":"7a7c4fa1-4ea9-49bb-8340-24e4495da296","block_type":"box","text":"market are closed may not be accepted. The Fund’s deadline specified above for the submission of","page_number":68,"box":{"x":117,"y":467,"width":742,"height":12}},{"id":"dfcf95a4-7a9a-4b06-9930-b329f1a30441","block_type":"box","text":"purchase orders is referred to as the Fund’s “Cutoff Time.” The Distributor or its agent, in their","page_number":68,"box":{"x":117,"y":482,"width":701,"height":12}},{"id":"76f7cf98-391d-4a2a-9bd6-d4925948d7ac","block_type":"box","text":"discretion, may permit the submission of such orders and requests by or through an Authorized","page_number":68,"box":{"x":116,"y":498,"width":712,"height":12}},{"id":"e03f5bb8-5a88-4346-8ce2-5f2ebc9b0ef3","block_type":"box","text":"Participant at any time (including on days on which the Listing Exchange is not open for business) via","page_number":68,"box":{"x":117,"y":513,"width":756,"height":12}},{"id":"6638fa6d-ad7f-46a6-891f-9ddfe66657e4","block_type":"box","text":"communication through the facilities of the Distributor’s or its agent’s proprietary website maintained for","page_number":68,"box":{"x":116,"y":529,"width":771,"height":12}},{"id":"95262349-5677-4de6-ae34-8d4bba90a83e","block_type":"box","text":"this purpose. Purchase orders and redemption requests, if accepted by the Trust, will be processed","page_number":68,"box":{"x":116,"y":544,"width":743,"height":12}},{"id":"ced6fa8d-fcb9-47d8-91ca-1caf38fde867","block_type":"box","text":"based on the NAV next determined after such acceptance in accordance with the Fund’s Cutoff Times","page_number":68,"box":{"x":117,"y":560,"width":762,"height":12}},{"id":"2584ada6-edda-4acf-b2d8-75e86155a2c1","block_type":"box","text":"as provided in the Authorized Participant Agreement and disclosed in this SAI.","page_number":68,"box":{"x":116,"y":575,"width":586,"height":12}},{"id":"54f09509-5119-43cb-89c4-58f148c670a5","block_type":"box","text":"Acceptance of Orders for Creation Units.","page_number":68,"box":{"x":116,"y":604,"width":325,"height":11}},{"id":"9393f5bf-73c9-4bd1-8c55-68b8da9fbc53","block_type":"box","text":"Subject to the conditions that (i) an irrevocable purchase","page_number":68,"box":{"x":442,"y":604,"width":430,"height":12}},{"id":"8b5fc6c5-0ba3-48ff-ac43-42c0320a2104","block_type":"box","text":"order has been submitted by the Authorized Participant (either on its own or another investor’s behalf)","page_number":68,"box":{"x":116,"y":619,"width":761,"height":12}},{"id":"df013ebd-8c79-4ad5-bafb-7a7502f47c47","block_type":"box","text":"and (ii) arrangements satisfactory to the Fund are in place for payment of the Cash Component and","page_number":68,"box":{"x":116,"y":635,"width":745,"height":12}},{"id":"6dd16aa1-4ec3-4cfa-a8ac-0b1e03b3fa7c","block_type":"box","text":"any other cash amounts which may be due, the Fund will accept the order, subject to the Fund’s right","page_number":68,"box":{"x":116,"y":650,"width":757,"height":12}},{"id":"62a125a6-ee78-4d48-89c1-9b7521051896","block_type":"box","text":"(and the right of the Distributor and BFA) to reject any order until acceptance, as set forth below.","page_number":68,"box":{"x":117,"y":666,"width":713,"height":12}},{"id":"96e53d82-1e4e-4e04-9f61-78e0671d9480","block_type":"box","text":"Once the Fund has accepted an order, upon the next determination of the NAV of the shares, the Fund","page_number":68,"box":{"x":116,"y":694,"width":764,"height":12}},{"id":"8c24cfe3-f948-4ce8-bdfa-9956555bf094","block_type":"box","text":"will confirm the issuance of a Creation Unit, against receipt of payment, at such NAV. The Distributor or","page_number":68,"box":{"x":116,"y":709,"width":767,"height":13}},{"id":"e0a2c671-7d3c-4212-8a9b-c78c2b4ddb70","block_type":"box","text":"its agent will then transmit a confirmation of acceptance to the Authorized Participant that placed the","page_number":68,"box":{"x":117,"y":725,"width":743,"height":12}},{"id":"dded8026-8e05-41ec-bb29-abb65ae970b3","block_type":"box","text":"order.","page_number":68,"box":{"x":116,"y":741,"width":42,"height":9}},{"id":"d7645791-43b8-4d2d-8309-19f42ff0a606","block_type":"box","text":"The Fund reserves the right to reject or revoke a creation order transmitted to it by the Distributor or its","page_number":68,"box":{"x":116,"y":769,"width":761,"height":12}},{"id":"b4413b8d-bd04-4184-ad4a-b32f218cce0f","block_type":"box","text":"agent provided that a rejection or revocation of a creation order does not violate Rule 6c-11 under the","page_number":68,"box":{"x":116,"y":784,"width":753,"height":12}},{"id":"99105952-0ee4-43db-ab1e-b111a46bf3ec","block_type":"box","text":"Investment Company Act. For example, the Fund may reject or revoke a creation order transmitted to it","page_number":68,"box":{"x":117,"y":800,"width":765,"height":12}},{"id":"ffb30ef7-9482-4585-a097-247e0df35a02","block_type":"box","text":"by the Distributor or its agent if (i) the order is not in proper form; (ii) the investor(s), upon obtaining the","page_number":68,"box":{"x":117,"y":815,"width":760,"height":12}},{"id":"530a6143-cfb3-4477-8e32-56e3d838e048","block_type":"box","text":"shares ordered, would own 80% or more of the currently outstanding shares of the Fund; (iii) the","page_number":68,"box":{"x":116,"y":831,"width":720,"height":12}},{"id":"ea32a2e3-ed4e-44f6-aa44-96d71584efad","block_type":"box","text":"Deposit Securities delivered do not conform to the identity and number of shares specified, as","page_number":68,"box":{"x":117,"y":846,"width":700,"height":12}},{"id":"2873bee0-3683-4999-b402-536a559bae05","block_type":"box","text":"described above; (iv) acceptance of the Deposit Securities is not legally required or would, in the","page_number":68,"box":{"x":116,"y":862,"width":721,"height":12}},{"id":"1bdb5288-9188-4b10-aa9d-05849b649252","block_type":"box","text":"opinion of counsel, be unlawful; or (v) circumstances outside the control of the Fund, the Distributor or","page_number":68,"box":{"x":116,"y":877,"width":761,"height":12}},{"id":"57e7cf21-1fec-4e6b-85be-7834786e7e8d","block_type":"box","text":"63","page_number":68,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"eb15836d-0226-4aa3-9503-fb446912f795","block_type":"box","text":"NM0926U-5926888-68/257","page_number":68,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"229ac211-4e42-4ae2-a397-caf8f3543aac","block_type":"box","text":"its agent and BFA make it impracticable to process purchase orders. The Distributor or its agent shall","page_number":69,"box":{"x":117,"y":87,"width":756,"height":12}},{"id":"218c4241-d4d6-4f27-8792-b8243a9b4940","block_type":"box","text":"notify a prospective purchaser of a Creation Unit and/or the Authorized Participant acting on behalf of","page_number":69,"box":{"x":117,"y":102,"width":756,"height":13}},{"id":"d0f95d0e-0a39-4822-ac74-0690ea97e71e","block_type":"box","text":"such purchaser of its rejection of such order. The Fund, JPMorgan, the sub-custodian and the","page_number":69,"box":{"x":116,"y":118,"width":702,"height":12}},{"id":"f2b6492c-c8f8-490a-abcc-f7d2ca6beb99","block_type":"box","text":"Distributor or its agent are under no duty, however, to give notification of any defects or irregularities in","page_number":69,"box":{"x":117,"y":134,"width":765,"height":12}},{"id":"c5ecf734-a823-4ca8-ae6c-94c35c3bcccd","block_type":"box","text":"the delivery of Fund Deposits nor shall any of them incur any liability for failure to give such notification.","page_number":69,"box":{"x":116,"y":149,"width":771,"height":12}},{"id":"10871681-c9c4-4cb1-b3b4-d719d9f89620","block_type":"box","text":"Issuance of a Creation Unit.","page_number":69,"box":{"x":117,"y":180,"width":225,"height":10}},{"id":"97f39396-7cea-4f8c-b80b-fd37cfc3578a","block_type":"box","text":"Except as provided herein, a Creation Unit will not be issued until the","page_number":69,"box":{"x":344,"y":180,"width":515,"height":12}},{"id":"430ee6f5-5d41-4fe5-9df0-c48d035b649a","block_type":"box","text":"transfer of good title to the Fund of the Deposit Securities and the payment of the Cash Component","page_number":69,"box":{"x":116,"y":196,"width":743,"height":12}},{"id":"21475f89-7725-48b2-87cb-c4dcb3c3f649","block_type":"box","text":"have been completed. When the sub-custodian has confirmed to the custodian that the securities","page_number":69,"box":{"x":117,"y":211,"width":726,"height":12}},{"id":"508d4043-8d40-460c-9981-e4fe4c822b31","block_type":"box","text":"included in the Fund Deposit (or the cash value thereof) have been delivered to the account of the","page_number":69,"box":{"x":117,"y":227,"width":731,"height":12}},{"id":"e3cd7000-135e-460a-872d-47f95f5c95ed","block_type":"box","text":"relevant sub-custodian or sub-custodians, the Distributor or its agent and BFA shall be notified of such","page_number":69,"box":{"x":117,"y":242,"width":763,"height":12}},{"id":"613f0e9f-f9b2-4f8e-8af7-62dffe9ef566","block_type":"box","text":"delivery and the Fund will issue and cause the delivery of the Creation Unit. Creation Units are","page_number":69,"box":{"x":116,"y":258,"width":706,"height":12}},{"id":"a7e7a7b8-494c-45a1-ad32-18e50f516991","block_type":"box","text":"generally issued on a “T+1 basis” (","page_number":69,"box":{"x":116,"y":273,"width":258,"height":12}},{"id":"da5d7d76-fde7-41e9-9f8d-c8286ecbb231","block_type":"box","text":"i.e.","page_number":69,"box":{"x":375,"y":273,"width":20,"height":10}},{"id":"69fd3418-0743-4d7c-8bee-4ca7e11c6c45","block_type":"box","text":", one Business Day after trade date). The Fund reserves the right","page_number":69,"box":{"x":398,"y":273,"width":489,"height":12}},{"id":"09935ccb-1f2d-487f-9005-f540bad9ac3d","block_type":"box","text":"to settle Creation Unit transactions on a basis other than T+1, as applicable. For example, the Fund","page_number":69,"box":{"x":116,"y":289,"width":744,"height":12}},{"id":"cfc96e04-b0ce-450f-a13f-d04a84bbfd98","block_type":"box","text":"reserves the right to settle Creation Unit transactions on a basis other than T+1 in order to","page_number":69,"box":{"x":117,"y":304,"width":672,"height":12}},{"id":"0da586f3-d9cc-4225-9571-de5e647fe59e","block_type":"box","text":"accommodate non-U.S. market holiday schedules, the occurrence of a holiday in the U.S. bond market","page_number":69,"box":{"x":116,"y":320,"width":769,"height":12}},{"id":"3fafe707-d841-4852-845a-e21eb00e7904","block_type":"box","text":"that is not a holiday observed in the U.S. equity market, to account for different treatment among","page_number":69,"box":{"x":116,"y":335,"width":722,"height":12}},{"id":"6394fb35-ec04-4350-bd14-a479462a9844","block_type":"box","text":"non-U.S. and U.S. markets of dividend record dates and dividend ex-dates (i.e., the last date the","page_number":69,"box":{"x":117,"y":351,"width":720,"height":12}},{"id":"8754017f-0aa6-44fa-a3ba-34f61ea616a8","block_type":"box","text":"holder of a security can sell the security and still receive dividends payable on the security sold) and in","page_number":69,"box":{"x":117,"y":366,"width":764,"height":12}},{"id":"7d61e991-e61f-491a-a21f-6a7191607381","block_type":"box","text":"certain other circumstances consistent with applicable law.","page_number":69,"box":{"x":116,"y":382,"width":440,"height":12}},{"id":"c34e55c1-86e3-4a69-bda5-bf2a119219d3","block_type":"box","text":"To the extent contemplated by an Authorized Participant Agreement with the Distributor, the Fund will","page_number":69,"box":{"x":116,"y":413,"width":759,"height":12}},{"id":"44fdd89c-3bf4-4281-9046-bc15a613f35a","block_type":"box","text":"issue Creation Units to such Authorized Participant, notwithstanding the fact that the corresponding","page_number":69,"box":{"x":117,"y":428,"width":741,"height":12}},{"id":"736f9e9a-606e-4fc0-a8fe-61d6e1b34b8d","block_type":"box","text":"Fund Deposits have not been received in part or in whole, in reliance on the undertaking of the","page_number":69,"box":{"x":117,"y":444,"width":706,"height":12}},{"id":"5eae2019-084b-426f-bed8-a1711920f8a6","block_type":"box","text":"Authorized Participant to deliver the missing Deposit Securities as soon as possible, which undertaking","page_number":69,"box":{"x":116,"y":459,"width":769,"height":12}},{"id":"94f2e555-5818-4d1e-85fa-251968c8ae07","block_type":"box","text":"shall be secured by such Authorized Participant’s delivery and maintenance of collateral as set forth in","page_number":69,"box":{"x":116,"y":475,"width":764,"height":12}},{"id":"d002c468-2de8-464d-9770-d2d3bdda46ae","block_type":"box","text":"the handbook for Authorized Participants. The Trust may use such collateral at any time to buy Deposit","page_number":69,"box":{"x":116,"y":490,"width":770,"height":12}},{"id":"8311ae8c-b3f4-4483-bf30-ef1e3f470612","block_type":"box","text":"Securities for the Fund. Such collateral must be delivered no later than the time specified by the Fund","page_number":69,"box":{"x":116,"y":506,"width":759,"height":12}},{"id":"20f31e21-cb6d-48e0-a15e-25e11130381e","block_type":"box","text":"or its custodian on the contractual settlement date. Information concerning the Fund’s current","page_number":69,"box":{"x":116,"y":521,"width":697,"height":12}},{"id":"0bda3327-e33f-45f1-a1b1-6ed0aa1e9bdd","block_type":"box","text":"procedures for collateralization of missing Deposit Securities is available from the Distributor or its","page_number":69,"box":{"x":117,"y":537,"width":730,"height":12}},{"id":"6f8651ad-64c0-4386-9e07-4f84674f567f","block_type":"box","text":"agent. The Authorized Participant Agreement will permit the Fund to buy the missing Deposit","page_number":69,"box":{"x":116,"y":552,"width":694,"height":12}},{"id":"ade97591-ff4e-4622-b8f0-b94a0f227875","block_type":"box","text":"Securities at any time and will subject the Authorized Participant to liability for any shortfall between the","page_number":69,"box":{"x":116,"y":568,"width":771,"height":12}},{"id":"d8613e34-5315-4d43-bb80-5a6c5af1b7d5","block_type":"box","text":"cost to the Fund of purchasing such securities and the collateral including, without limitation, liability for","page_number":69,"box":{"x":116,"y":583,"width":769,"height":12}},{"id":"e399ea73-bd76-476e-b984-cb4d9156bee4","block_type":"box","text":"related brokerage, borrowings and other charges.","page_number":69,"box":{"x":117,"y":599,"width":372,"height":12}},{"id":"ade5273f-fd99-45e4-9dba-e7b5845fa64b","block_type":"box","text":"In certain cases, Authorized Participants may create and redeem Creation Units on the same trade","page_number":69,"box":{"x":117,"y":630,"width":738,"height":12}},{"id":"2ba3dd2e-9ef0-44b4-957b-865a906f2975","block_type":"box","text":"date and in these instances, the Fund reserves the right to settle these transactions on a net basis or","page_number":69,"box":{"x":116,"y":645,"width":754,"height":12}},{"id":"c8784969-775c-4e63-b86c-d51b06a4d279","block_type":"box","text":"require a representation from the Authorized Participants that the creation and redemption transactions","page_number":69,"box":{"x":117,"y":661,"width":764,"height":12}},{"id":"4cb6e0cb-a9c8-4b14-ae63-0d5b228515e6","block_type":"box","text":"are for separate beneficial owners. All questions as to the number of shares of each security in the","page_number":69,"box":{"x":116,"y":676,"width":731,"height":12}},{"id":"77e3cade-9680-4216-ab5d-f543ab96dcfc","block_type":"box","text":"Deposit Securities and the validity, form, eligibility and acceptance for deposit of any securities to be","page_number":69,"box":{"x":117,"y":692,"width":742,"height":12}},{"id":"33077787-54fa-4be8-875f-6388e927e49e","block_type":"box","text":"delivered shall be determined by the Fund and the Fund’s determination shall be final and binding.","page_number":69,"box":{"x":116,"y":707,"width":729,"height":12}},{"id":"5fb677a1-dc37-4e9c-96f0-c182c5547e19","block_type":"box","text":"Costs Associated with Creation Transactions.","page_number":69,"box":{"x":116,"y":738,"width":358,"height":10}},{"id":"900bb961-9b88-4ed5-8ad3-c86e8585afdb","block_type":"box","text":"A standard creation transaction fee is imposed to offset","page_number":69,"box":{"x":480,"y":738,"width":401,"height":12}},{"id":"c2554021-a853-4256-86ac-55940baf7fad","block_type":"box","text":"the transfer and other transaction costs associ","page_number":69,"box":{"x":116,"y":754,"width":335,"height":9}},{"id":"67d502d3-8404-4fc2-aafc-000bc21f105a","block_type":"box","text":"ated with the issuance of Creation Units.","page_number":69,"box":{"x":453,"y":754,"width":292,"height":9}},{"id":"f0c3d879-08c0-46ba-9362-7ca2fc47c62c","block_type":"box","text":"Under an ETF Services Agreement, the Fund has retained BRIL, an affiliate of BFA, to perform certain","page_number":69,"box":{"x":117,"y":785,"width":742,"height":12}},{"id":"7ea08dfc-1a05-4117-a5b4-55a25104bda1","block_type":"box","text":"ETF Services. BRIL will receive from an Authoriz","page_number":69,"box":{"x":117,"y":800,"width":353,"height":10}},{"id":"010fbcc2-5f0b-4d05-98a8-29a3e88cd644","block_type":"box","text":"ed Participant a standard transaction fee on each","page_number":69,"box":{"x":471,"y":800,"width":357,"height":12}},{"id":"d8aa7073-9fc5-4d5b-9384-feec2caae1d8","block_type":"box","text":"creation order, which consists of (1) a fee for providing the ETF Services (the “ETF Servicing Fee”) and","page_number":69,"box":{"x":116,"y":816,"width":748,"height":12}},{"id":"f388988f-16ac-4f86-aa1f-4f04c862e773","block_type":"box","text":"(2) transfer, processing and other transaction costs","page_number":69,"box":{"x":117,"y":831,"width":375,"height":12}},{"id":"280bc448-b8c0-49c9-8393-96edf802bc70","block_type":"box","text":"charged by the Fund custodian in connection with the","page_number":69,"box":{"x":492,"y":831,"width":393,"height":12}},{"id":"19698937-f02b-4e58-89f0-24f8cd0b347b","block_type":"box","text":"issuance of Creation Units for such creation order","page_number":69,"box":{"x":117,"y":847,"width":365,"height":9}},{"id":"bf08ac5a-5c6f-4fc2-bec7-3acbdf00d949","block_type":"box","text":"(“Custody Transaction Costs”). BRIL is entitled to","page_number":69,"box":{"x":482,"y":847,"width":362,"height":12}},{"id":"b2688824-e290-47fe-a7aa-6ade100ee6d4","block_type":"box","text":"retain the ETF Servicing Fee pursuant to the E","page_number":69,"box":{"x":117,"y":862,"width":337,"height":12}},{"id":"6580618a-5619-40bc-98ae-2eeac0953e6d","block_type":"box","text":"TF Services Agreement, but BRIL will reimburse any","page_number":69,"box":{"x":455,"y":862,"width":387,"height":12}},{"id":"8bde396d-6a59-4ce7-a64b-07d63ae1af85","block_type":"box","text":"Custody Transaction Costs to the Fund custodian accord","page_number":69,"box":{"x":117,"y":878,"width":412,"height":12}},{"id":"84b1e3d7-7cf5-4c43-b9eb-02539efb74c1","block_type":"box","text":"ing to the amounts invoiced by such custodian.","page_number":69,"box":{"x":532,"y":878,"width":344,"height":12}},{"id":"366c4233-218b-4b50-8026-b506ffad0576","block_type":"box","text":"64","page_number":69,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"b45ed4bd-0db8-4b66-9b82-eb27bb0afcd5","block_type":"box","text":"NM0926U-5926888-69/257","page_number":69,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"54fe4d70-b31d-4a9d-ad81-987f53a2d14d","block_type":"box","text":"The ETF Servicing Fee is a flat fee per order regardless of the number of Creation Units being","page_number":70,"box":{"x":116,"y":87,"width":704,"height":12}},{"id":"f1b9eeee-143a-49c5-baba-d2ae1b018209","block_type":"box","text":"purchased, which amount will vary among different BlackRock-advised funds based on a number of","page_number":70,"box":{"x":117,"y":102,"width":743,"height":13}},{"id":"eb8ca61d-cf6e-44a3-abfd-c5a09251cad8","block_type":"box","text":"factors, including the complexity of the order and the types of securities or instruments included in a","page_number":70,"box":{"x":116,"y":118,"width":745,"height":12}},{"id":"e1643786-21ae-49e3-8b82-55918ecfaffe","block_type":"box","text":"fund’s Creation Basket, among other variables. The ETF Servicing Fee may be equal to zero in certain","page_number":70,"box":{"x":116,"y":134,"width":767,"height":12}},{"id":"64e27529-60a8-469c-9d1c-6547701ae86a","block_type":"box","text":"instances, such as for creation transactions that consist solely of cash. The actual Custody Transaction","page_number":70,"box":{"x":117,"y":149,"width":770,"height":12}},{"id":"740ccf1b-b346-4c81-b426-3a93fc5c0be3","block_type":"box","text":"Costs vary per order based on the number of trades, underlying markets and settlement locations","page_number":70,"box":{"x":117,"y":165,"width":728,"height":12}},{"id":"6cd54f54-2b59-4e03-bcdb-b0bca3511866","block_type":"box","text":"associated with the issuance of a Creation Unit. The following table sets forth for the Fund an estimate","page_number":70,"box":{"x":116,"y":180,"width":765,"height":12}},{"id":"ab6608e0-28bb-4828-89d8-18d87fdb1bcd","block_type":"box","text":"of the creation transaction fee that would have been charged as of July 31, 2026, if the Fund had","page_number":70,"box":{"x":116,"y":196,"width":724,"height":12}},{"id":"c0b3a4f0-c2a4-4265-bda2-8c8762ec8e74","block_type":"box","text":"issued a Creation Unit on that date. The actual fee that would have been charged to an Authorized","page_number":70,"box":{"x":117,"y":211,"width":736,"height":12}},{"id":"77ac1127-a171-4466-ac7d-d3cc170b4e54","block_type":"box","text":"Participant in connection with a creation order will vary over time depending on the factors discussed","page_number":70,"box":{"x":117,"y":227,"width":752,"height":12}},{"id":"647c594d-6b81-4081-9e7d-2bd075a6ea5b","block_type":"box","text":"above, and may be higher than the fee set forth below.","page_number":70,"box":{"x":116,"y":242,"width":412,"height":12}},{"id":"1b2b71bb-2b31-4313-8ff8-a41cc4391234","block_type":"box","text":"In order to defray transaction expenses for the Fund and protect against possible shareholder dilution,","page_number":70,"box":{"x":117,"y":271,"width":761,"height":12}},{"id":"ee1201db-d4f9-496e-ae55-e1dfed3c3389","block_type":"box","text":"if a creation transaction consists solely or partially of cash, the Authorized Participant may also be","page_number":70,"box":{"x":117,"y":286,"width":729,"height":12}},{"id":"45bb938b-3e89-441f-8b9c-116abe8d9f4a","block_type":"box","text":"required to cover (up to the maximum amount shown below) certain brokerage, tax, foreign exchange,","page_number":70,"box":{"x":117,"y":302,"width":762,"height":12}},{"id":"c0fe7ef4-81c4-4624-9564-6e9bac789cff","block_type":"box","text":"execution and other costs and expenses related to the execution of trades resulting from such","page_number":70,"box":{"x":116,"y":317,"width":703,"height":12}},{"id":"695a8725-75c0-4208-bdbd-e371834829e2","block_type":"box","text":"transaction (which may, in certain instances, be based on a good faith estimate of transaction costs","page_number":70,"box":{"x":116,"y":333,"width":743,"height":12}},{"id":"ebf392cf-8608-464f-b2c2-84cabdfe9dd7","block_type":"box","text":"based on historical data or other inputs, at BlackRock’s discretion, and may include part or all of the","page_number":70,"box":{"x":117,"y":348,"width":743,"height":12}},{"id":"d488b98d-744f-4be7-a1d8-3d881173676e","block_type":"box","text":"spread between the expected bid and offer side of the market and anticipated market impact).","page_number":70,"box":{"x":116,"y":364,"width":702,"height":12}},{"id":"0cbc4787-2120-4063-80ba-97ebd9f96d33","block_type":"box","text":"However, the Fund is not obligated to trade identical securities to the securities identified by BlackRock","page_number":70,"box":{"x":117,"y":379,"width":769,"height":12}},{"id":"5d1a3b56-7e87-4d61-84f8-fa6a6b10fde6","block_type":"box","text":"in estimating these transaction and other costs and expenses. In certain cases, BlackRock or an","page_number":70,"box":{"x":117,"y":395,"width":719,"height":12}},{"id":"6a881d24-aad6-433b-b636-25ece48e48de","block_type":"box","text":"affiliate may determine in its discretion to deviate from the regular charge, subject to the maximum","page_number":70,"box":{"x":116,"y":410,"width":734,"height":12}},{"id":"68684430-d90d-4bc3-b492-6e7cccb00d76","block_type":"box","text":"amounts shown below.","page_number":70,"box":{"x":116,"y":426,"width":176,"height":9}},{"id":"c0445646-f3c6-45fa-a411-6cd4d05a8159","block_type":"box","text":"The following table sets forth the Fund’s estimated creation transaction fee as of July 31, 2026 and","page_number":70,"box":{"x":116,"y":454,"width":738,"height":12}},{"id":"885e3c70-1371-4ca6-a425-179ba95f1f74","block_type":"box","text":"maximum additional charge (as described above):","page_number":70,"box":{"x":117,"y":470,"width":376,"height":12}},{"id":"1d6c9937-9d38-44dc-8492-bca17e7ea005","block_type":"box","text":"Standard","page_number":70,"box":{"x":380,"y":495,"width":57,"height":8}},{"id":"329a2e03-71dc-436a-9db6-84a50426851b","block_type":"box","text":"Creation","page_number":70,"box":{"x":382,"y":505,"width":53,"height":8}},{"id":"c9889504-b9ac-4e9b-8b07-417e38ad13c4","block_type":"box","text":"Transaction Fee*","page_number":70,"box":{"x":355,"y":516,"width":108,"height":7}},{"id":"c1900677-7e9d-4e68-bf27-36ad5e46778d","block_type":"box","text":"Maximum Additional","page_number":70,"box":{"x":526,"y":506,"width":129,"height":7}},{"id":"474140ea-4b4c-43c7-b02c-73cfb1f4f6c4","block_type":"box","text":"Charge**","page_number":70,"box":{"x":563,"y":516,"width":56,"height":9}},{"id":"b112aa84-3164-4229-a51c-ecdfefb4c332","block_type":"box","text":"$0.00 3%","page_number":70,"box":{"x":388,"y":534,"width":219,"height":11}},{"id":"321c282b-ab29-477d-b410-6506980a56d6","block_type":"box","text":"* The standard creation transaction fee consists of the ETF Servicing Fee and Custody Transaction Costs. The standard","page_number":70,"box":{"x":143,"y":580,"width":732,"height":9}},{"id":"017cb339-8190-4486-90ea-035d6b4f5289","block_type":"box","text":"creation transaction fee may vary over time depending on the factors discussed above, and may be higher than the fee","page_number":70,"box":{"x":170,"y":592,"width":706,"height":10}},{"id":"540887b6-7a55-4728-a0a1-8d085efd6cbb","block_type":"box","text":"set forth above.","page_number":70,"box":{"x":170,"y":605,"width":91,"height":8}},{"id":"e1cf026b-e7f9-4e95-9b01-cf7b6677eac0","block_type":"box","text":"** As a percentage of the net asset value per Creation Unit.","page_number":70,"box":{"x":143,"y":620,"width":364,"height":10}},{"id":"7378f117-d74b-4e48-bc61-1c05fab39411","block_type":"box","text":"Redemption of Creation Units.","page_number":70,"box":{"x":117,"y":647,"width":240,"height":12}},{"id":"811138e2-5c08-4511-813d-e33c0ca6cbfb","block_type":"box","text":"Shares of the Fund may be redeemed by Authorized Participants only","page_number":70,"box":{"x":358,"y":647,"width":529,"height":12}},{"id":"e92fb952-573b-42e6-8fa2-6e9669d409f1","block_type":"box","text":"in Creation Units at their NAV next determined after receipt of a redemption request in proper form by","page_number":70,"box":{"x":117,"y":663,"width":752,"height":12}},{"id":"5286a32e-4362-4d27-86f2-6f2c65f19a88","block_type":"box","text":"the Distributor or its agent and only on a Business Day. The Fund will not redeem shares in amounts","page_number":70,"box":{"x":116,"y":678,"width":747,"height":12}},{"id":"2bca69ac-bcca-40bc-8d25-37ed45dfefbd","block_type":"box","text":"less than Creation Units. There can be no assurance, however, that there will be sufficient liquidity in","page_number":70,"box":{"x":117,"y":694,"width":745,"height":12}},{"id":"1092986c-bedb-4b08-8b79-a50ddd9859c7","block_type":"box","text":"the secondary market at any time to permit assembly of a Creation Unit. Investors should expect to","page_number":70,"box":{"x":116,"y":709,"width":735,"height":12}},{"id":"26595554-11d7-40dd-b6df-228d0fc44ac1","block_type":"box","text":"incur brokerage and other costs in connection with assembling a sufficient number of shares to","page_number":70,"box":{"x":117,"y":725,"width":703,"height":12}},{"id":"94f5f79b-a0c3-4f49-b0f6-91aa6a5c5770","block_type":"box","text":"constitute a Creation Unit that could be redeemed by an Authorized Participant. Beneficial owners also","page_number":70,"box":{"x":116,"y":740,"width":762,"height":12}},{"id":"6bcc7d95-c995-4bfe-983e-9e1a24cbfd57","block_type":"box","text":"may sell shares in the secondary market.","page_number":70,"box":{"x":117,"y":756,"width":303,"height":12}},{"id":"cbf505ef-06b7-40c8-832e-3b77cfb66429","block_type":"box","text":"The Fund generally redeems Creation Units solely for cash. However, the Fund reserves the right to","page_number":70,"box":{"x":116,"y":784,"width":743,"height":12}},{"id":"791bacc0-993c-43dc-9c39-40b470435ab5","block_type":"box","text":"distribute securities in-kind as payment for Creation Units being redeemed at any time. For example,","page_number":70,"box":{"x":116,"y":800,"width":745,"height":12}},{"id":"c20b21e3-cacf-47b5-9a73-2972742ba53c","block_type":"box","text":"the Fund may determine to offer in-kind redemptions instead of cash redemptions in response to","page_number":70,"box":{"x":116,"y":815,"width":716,"height":12}},{"id":"166a4f00-51ea-4733-8692-4b8a240df8bc","block_type":"box","text":"changing market conditions or during periods of volatility. The Fund is permitted to offer either cash or","page_number":70,"box":{"x":116,"y":831,"width":760,"height":12}},{"id":"3a2e0527-a36e-4ecd-bc11-56c7275c6771","block_type":"box","text":"in-kind redemptions, which may vary throughout the trading day, in the discretion of the Fund. Please","page_number":70,"box":{"x":117,"y":846,"width":755,"height":12}},{"id":"7d2c6942-0899-4b0a-aa47-8f0fb0d16d68","block_type":"box","text":"see the Cash Redemption Method section below and the following discussion summarizing the in-kind","page_number":70,"box":{"x":116,"y":862,"width":763,"height":12}},{"id":"5588197b-f38f-4dc8-b716-7ac14be1d5ca","block_type":"box","text":"method for further information on redeeming Creation Units of the Fund.","page_number":70,"box":{"x":117,"y":877,"width":539,"height":12}},{"id":"90e39c34-937d-4e04-b08b-b556fc64d06a","block_type":"box","text":"65","page_number":70,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"10929bc5-3d78-424b-aaec-92f5d0920c7b","block_type":"box","text":"NM0926U-5926888-70/257","page_number":70,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"68e359f4-6579-48b7-81cd-f50699b8e7cb","block_type":"box","text":"The Fund publishes the designated portfolio of securities (including any portion of such securities for","page_number":71,"box":{"x":116,"y":87,"width":750,"height":12}},{"id":"9fc50eef-90fe-4d59-bfe8-cb364736839a","block_type":"box","text":"which cash may be substituted) that will be applicable to redemption requests received in proper form","page_number":71,"box":{"x":116,"y":102,"width":758,"height":13}},{"id":"d4bf1052-ccba-47ed-a13a-9fd5db7bc54c","block_type":"box","text":"(as defined below) on that day (“Fund Securities” or “Redemption Basket”), and an amount of cash (the","page_number":71,"box":{"x":117,"y":118,"width":770,"height":12}},{"id":"50d3dbec-7fcf-40d7-a229-4c643e6755bf","block_type":"box","text":"“Cash Amount,” as described below) in order to effect redemptions of Creation Units of the Fund. Such","page_number":71,"box":{"x":116,"y":134,"width":768,"height":12}},{"id":"25951c07-7c57-4337-abfc-d478042663c1","block_type":"box","text":"Fund Securities and Cash Amount will remain in effect until such time as the next announced","page_number":71,"box":{"x":117,"y":149,"width":695,"height":10}},{"id":"1e016cc4-9789-44cd-adb2-9a966783dc31","block_type":"box","text":"composition of the Fund Securities and Cash Amount is made available. The Fund Securities and","page_number":71,"box":{"x":116,"y":165,"width":729,"height":11}},{"id":"020a845c-bf5a-43c5-a5c1-604cfd10be4f","block_type":"box","text":"Cash Amount are subject to possible amendment or correction. Procedures and requirements","page_number":71,"box":{"x":117,"y":180,"width":700,"height":12}},{"id":"67840adc-a787-41b4-98a6-72e4f894bbe4","block_type":"box","text":"governing redemption transactions are set forth in the handbook for Authorized Participants and may","page_number":71,"box":{"x":116,"y":196,"width":753,"height":12}},{"id":"6389ac99-b921-4c00-bfb5-fab2d393f91c","block_type":"box","text":"change from time to time.","page_number":71,"box":{"x":116,"y":211,"width":194,"height":12}},{"id":"816027e1-7bec-4f1e-aed3-8d2fa869aff6","block_type":"box","text":"Unless cash redemptions are available or specified for the Fund, the redemption proceeds for a","page_number":71,"box":{"x":117,"y":242,"width":713,"height":12}},{"id":"939caa64-e21e-462a-a2d5-77dfc07aa647","block_type":"box","text":"Creation Unit generally consist of Fund Securities, plus the Cash Amount, which is an amount equal to","page_number":71,"box":{"x":117,"y":258,"width":765,"height":12}},{"id":"7ee462eb-2b45-4826-84b7-8aa563739c86","block_type":"box","text":"the difference between the net asset value of the shares being redeemed, as next determined after the","page_number":71,"box":{"x":116,"y":273,"width":768,"height":12}},{"id":"d1ff6349-c5c8-4f6d-92cc-fb9327e96467","block_type":"box","text":"receipt of a redemption request in proper form, and the value of Fund Securities, less a redemption","page_number":71,"box":{"x":117,"y":289,"width":739,"height":12}},{"id":"2ef04fe3-76df-4b30-8286-cf62f9a4d4ee","block_type":"box","text":"transaction fee (as described below).","page_number":71,"box":{"x":116,"y":304,"width":279,"height":12}},{"id":"1127518e-8abf-43d1-b622-744ab08ac81c","block_type":"box","text":"The Trust may, in its sole discretion, substitute a “cash in lieu” amount to replace any Fund Security in","page_number":71,"box":{"x":116,"y":335,"width":762,"height":12}},{"id":"3de76b16-0730-4ac6-afe0-be08d38d341c","block_type":"box","text":"certain circumstances, including: (i) when the delivery of a Fund Security to the Authorized Participant","page_number":71,"box":{"x":116,"y":351,"width":760,"height":12}},{"id":"3471eb9d-5645-4a8c-86e8-639a487aa4af","block_type":"box","text":"(or to an investor on whose behalf the Authorized Participant is acting) would be restricted under","page_number":71,"box":{"x":117,"y":366,"width":720,"height":12}},{"id":"65c88553-f044-4136-bffa-f729470e3944","block_type":"box","text":"applicable securities or other local laws or due to a trading restriction; (ii) when the delivery of a Fund","page_number":71,"box":{"x":116,"y":382,"width":755,"height":12}},{"id":"705f11f0-fb53-4929-a3e5-e540fa6094eb","block_type":"box","text":"Security to the Authorized Participant would result in the disposition of the Fund Security by the","page_number":71,"box":{"x":116,"y":397,"width":712,"height":12}},{"id":"aa7d4396-99ec-47b2-909d-f459485f87a1","block_type":"box","text":"Authorized Participant due to restrictions under applicable securities or other local laws; (iii) when the","page_number":71,"box":{"x":116,"y":413,"width":755,"height":12}},{"id":"84ae6065-d95b-4759-9adc-34cc9246f1a2","block_type":"box","text":"delivery of a Fund Security to the Authorized Participant would result in unfavorable tax treatment;","page_number":71,"box":{"x":116,"y":428,"width":732,"height":12}},{"id":"61ba4a8b-b23a-468d-b921-0be1cd6333af","block_type":"box","text":"(iv) when a Fund Security cannot be settled or otherwise delivered in time to facilitate an in-kind","page_number":71,"box":{"x":117,"y":444,"width":714,"height":12}},{"id":"4db634f2-0229-47ac-b92b-fe4a61ba69d7","block_type":"box","text":"redemption; or (v) in certain other situations. The amount of cash paid out in such cases will be","page_number":71,"box":{"x":117,"y":459,"width":709,"height":12}},{"id":"41b9b800-e08d-4491-bf63-7aee75ecbef9","block_type":"box","text":"equivalent to the value of the substituted security listed as a Fund Security. In the event that the Fund","page_number":71,"box":{"x":116,"y":475,"width":759,"height":12}},{"id":"4263f57f-4057-4a24-bbf8-72202bcd289d","block_type":"box","text":"Securities have a value greater than the NAV of the shares, a compensating cash payment equal to","page_number":71,"box":{"x":116,"y":490,"width":745,"height":12}},{"id":"e9cb85ea-75e5-4815-a646-229abbb6028a","block_type":"box","text":"the difference is required to be made by or through an Authorized Participant by the redeeming","page_number":71,"box":{"x":116,"y":506,"width":710,"height":12}},{"id":"c0306bb4-1b31-4a18-a3d3-d3e21b6b269e","block_type":"box","text":"shareholder. The Fund generally redeems Creation Units for cash and/or in-kind. The Redemption","page_number":71,"box":{"x":116,"y":521,"width":734,"height":12}},{"id":"c9b25080-e8c9-4a41-b591-59ad4fe8a20b","block_type":"box","text":"Basket may also be modified to minimize the Cash Component by redistributing the cash to the Fund","page_number":71,"box":{"x":117,"y":537,"width":754,"height":12}},{"id":"3bde1fd3-d383-4862-b6af-99130e3c22db","block_type":"box","text":"Securities portion of the Redemption Basket through systematically rounding. The rounding","page_number":71,"box":{"x":116,"y":552,"width":683,"height":12}},{"id":"ceb78b19-20cc-4169-a531-a10f75ef6260","block_type":"box","text":"methodology allows position sizes of securities in the Fund Securities to be “rounded up,” while limiting","page_number":71,"box":{"x":117,"y":568,"width":767,"height":12}},{"id":"8b40992a-2642-4789-a13e-afd3c50518da","block_type":"box","text":"the maximum allowed percentage change in weight and share quantity of any given security in the","page_number":71,"box":{"x":116,"y":583,"width":734,"height":12}},{"id":"354e9ffc-7901-45db-8edb-c0197c96d6a8","block_type":"box","text":"Redemption Basket. Redemption Baskets may also be modified to position a fund towards a forward","page_number":71,"box":{"x":117,"y":599,"width":750,"height":12}},{"id":"f98ea4e8-ad0b-4b2f-8a12-fb791d67a7c8","block_type":"box","text":"index rebalance to reflect revisions that account for index additions, deletions, and re-weights.","page_number":71,"box":{"x":117,"y":614,"width":701,"height":12}},{"id":"dd0ce2b8-069a-4836-9241-0ffdc6f7a8b1","block_type":"box","text":"Cash Redemption Method.","page_number":71,"box":{"x":116,"y":645,"width":211,"height":12}},{"id":"a8edc31a-425b-4fb2-9b81-9c620611c44e","block_type":"box","text":"Partial or full cash redemptions will be effected in essentially the same","page_number":71,"box":{"x":328,"y":645,"width":531,"height":12}},{"id":"1af56320-b859-4904-be6b-6f97762df9c2","block_type":"box","text":"manner as in-kind redemptions thereof. In the case of partial or full cash redemption, the Authorized","page_number":71,"box":{"x":117,"y":661,"width":740,"height":12}},{"id":"b511d075-967d-4003-97bb-3f34789b4137","block_type":"box","text":"Participant receives the cash equivalent of the Fund Securities it would otherwise receive through an","page_number":71,"box":{"x":117,"y":676,"width":745,"height":12}},{"id":"f0674042-9f4a-4e1c-92ab-941b7c42b2ef","block_type":"box","text":"in-kind redemption, plus the same Cash Amount to be paid to an in-kind redeemer.","page_number":71,"box":{"x":117,"y":692,"width":613,"height":12}},{"id":"9ba8e7a3-ec0a-4e1e-85d0-2211d005fa60","block_type":"box","text":"Costs Associated with Redemption Transactions.","page_number":71,"box":{"x":116,"y":723,"width":394,"height":12}},{"id":"e60fb939-8e55-49a4-aaf8-ef572ad6c6df","block_type":"box","text":"A standard redemption transaction fee is","page_number":71,"box":{"x":516,"y":723,"width":302,"height":12}},{"id":"f538bf11-039d-4fac-8e37-1139992b8343","block_type":"box","text":"imposed to offset transfer and other transaction costs that may be incurred by the Fund. As described","page_number":71,"box":{"x":117,"y":738,"width":753,"height":12}},{"id":"0d26bb0c-4515-46ce-b5a1-207ca7ec2099","block_type":"box","text":"above, under an ETF Services Agreement, the Fund has retained BRIL, an affiliate of BFA, to perform","page_number":71,"box":{"x":116,"y":754,"width":757,"height":12}},{"id":"9f8d1a30-070d-4b0e-a99d-b5f0a6b913d9","block_type":"box","text":"certain ETF Services. BRIL will receive from an Authorized Participant a standard transaction fee on","page_number":71,"box":{"x":116,"y":769,"width":742,"height":12}},{"id":"5c06f22e-4046-471a-b504-0f7787271b67","block_type":"box","text":"each redemption order, which consists of (1) the ETF Servicing Fee and (2) Custody Transaction","page_number":71,"box":{"x":116,"y":785,"width":719,"height":12}},{"id":"a2ef0734-d80a-47af-924d-f1315f5f8c7f","block_type":"box","text":"Costs. BRIL is entitled to retain the ETF Servicing Fee pursuant to the ETF Services Agreement, but","page_number":71,"box":{"x":117,"y":800,"width":744,"height":12}},{"id":"26a6c8cc-51db-4936-a98d-3f35287ec172","block_type":"box","text":"BRIL will reimburse any Custody Transaction Costs to the Fund custodian according to the amounts","page_number":71,"box":{"x":117,"y":816,"width":742,"height":12}},{"id":"4d08ff8c-a332-44b8-9115-31ff22768db2","block_type":"box","text":"invoiced by such custodian.","page_number":71,"box":{"x":117,"y":831,"width":209,"height":12}},{"id":"b835c04a-f0ce-4be5-969e-a8b8ee933399","block_type":"box","text":"The ETF Servicing Fee is a flat fee per order regardless of the number of Creation Units being","page_number":71,"box":{"x":116,"y":862,"width":704,"height":12}},{"id":"2a46df0a-f9b6-4521-89b3-d07bfd15f5db","block_type":"box","text":"redeemed, which amount will vary among different BlackRock-advised funds based on a number of","page_number":71,"box":{"x":117,"y":878,"width":741,"height":12}},{"id":"a287a402-fa15-476f-9b59-a63037301c42","block_type":"box","text":"66","page_number":71,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"4c873516-e970-4b11-b29f-6ab46c92e0ab","block_type":"box","text":"NM0926U-5926888-71/257","page_number":71,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"03c051bf-23d5-4e76-9296-44b2752c8348","block_type":"box","text":"factors, including the complexity of the order and the types of securities or instruments included in a","page_number":72,"box":{"x":116,"y":87,"width":745,"height":12}},{"id":"a8207db5-9e18-4ced-b17a-1de463a2c167","block_type":"box","text":"fund’s Redemption Basket, among other variables. The ETF Servicing Fee may be equal to zero in","page_number":72,"box":{"x":116,"y":102,"width":739,"height":13}},{"id":"3b9a93b7-2c20-4733-9a75-5045f6396ef0","block_type":"box","text":"certain instances, such as for redemption transactions that consist solely of cash. The actual Custody","page_number":72,"box":{"x":116,"y":118,"width":758,"height":12}},{"id":"6a6b3f2e-5f49-45eb-82d0-8c1b8ac90c77","block_type":"box","text":"Transaction Costs vary per order based on the number of trades, underlying markets, and settlement","page_number":72,"box":{"x":116,"y":134,"width":755,"height":12}},{"id":"3a991202-e3f1-48e6-a72f-0bce7759825c","block_type":"box","text":"locations associated with the redemption of a Creation Unit. The following table sets forth for the Fund","page_number":72,"box":{"x":117,"y":149,"width":761,"height":12}},{"id":"6908d0c0-e853-45dc-9fca-c9df81e2469e","block_type":"box","text":"an estimate of the redemption transaction fee that would have been charged as of July 31, 2026, if the","page_number":72,"box":{"x":116,"y":165,"width":764,"height":12}},{"id":"94dbd8ed-3790-497b-b4e4-ba5057c8ad29","block_type":"box","text":"Fund had redeemed a Creation Unit on that date. The actual fee charged to an Authorized Participant","page_number":72,"box":{"x":117,"y":180,"width":759,"height":12}},{"id":"1c178598-cdc5-4ed9-8692-191ca524a514","block_type":"box","text":"in connection with a redemption order will vary over time depending on the factors discussed above,","page_number":72,"box":{"x":117,"y":196,"width":747,"height":12}},{"id":"000b7432-fc70-40dc-8c46-5fe880e7633d","block_type":"box","text":"and may be higher than the fee set forth below.","page_number":72,"box":{"x":116,"y":211,"width":356,"height":12}},{"id":"699f3b1a-29b3-4dc2-8386-240bcaaba395","block_type":"box","text":"In order to defray transaction expenses for the Fund and protect against possible shareholder dilution,","page_number":72,"box":{"x":117,"y":242,"width":761,"height":12}},{"id":"85a30a9f-be9c-4f5a-b8b5-4a4eabcc6ff7","block_type":"box","text":"if a redemption transaction consists solely or partially of cash, the Authorized Participant may also be","page_number":72,"box":{"x":117,"y":257,"width":754,"height":12}},{"id":"a819851b-d2b2-4439-8b53-64d6574a5d67","block_type":"box","text":"required to cover (up to the maximum amount shown below) certain brokerage, tax, foreign exchange,","page_number":72,"box":{"x":117,"y":273,"width":762,"height":12}},{"id":"24762c88-e745-4ae8-8c5f-6b9e02507fa2","block_type":"box","text":"execution and other costs and expenses related to the execution of trades resulting from such","page_number":72,"box":{"x":116,"y":288,"width":703,"height":12}},{"id":"9a04c886-fb48-4ad7-a1eb-0bded08e6935","block_type":"box","text":"transaction (which may, in certain instances, be based on a good faith estimate of transaction costs","page_number":72,"box":{"x":116,"y":304,"width":743,"height":12}},{"id":"7528b0d8-1857-4111-8a63-04366fc9fae3","block_type":"box","text":"based on historical data or other inputs, at BlackRock’s discretion, and may include part or all of the","page_number":72,"box":{"x":117,"y":319,"width":743,"height":12}},{"id":"d6038ee8-8991-4dd7-b698-167206748773","block_type":"box","text":"spread between the expected bid and offer side of the market and anticipated market impact).","page_number":72,"box":{"x":116,"y":335,"width":702,"height":12}},{"id":"589f254c-6425-4bd0-b0da-7aef3a8aed95","block_type":"box","text":"However, the Fund is not obligated to trade identical securities to the securities identified by BlackRock","page_number":72,"box":{"x":117,"y":350,"width":769,"height":12}},{"id":"88d35a49-8ddf-4810-8b1e-7a98e28ff3b1","block_type":"box","text":"in estimating these transaction and other costs and expenses. In certain cases, BlackRock or an","page_number":72,"box":{"x":117,"y":366,"width":719,"height":12}},{"id":"1d6ca084-f9df-4270-97be-be05a5f13462","block_type":"box","text":"affiliate may determine in its discretion to deviate from the regular charge, subject to the maximum","page_number":72,"box":{"x":116,"y":381,"width":734,"height":12}},{"id":"682ccc9a-c8df-469d-b712-02e55bd1edb2","block_type":"box","text":"amounts shown below.","page_number":72,"box":{"x":116,"y":397,"width":176,"height":9}},{"id":"d669c624-c1cf-4f49-a07b-642394fc6cef","block_type":"box","text":"The following table sets forth the Fund’s estimated redemption transaction fee as of July 31, 2026 and","page_number":72,"box":{"x":116,"y":428,"width":762,"height":12}},{"id":"e1b327ad-b786-42f8-9392-d880c9209f42","block_type":"box","text":"maximum additional charge (as described above):","page_number":72,"box":{"x":117,"y":443,"width":376,"height":12}},{"id":"b7cae088-74f5-472e-bd90-edc1f0c219a8","block_type":"box","text":"Standard","page_number":72,"box":{"x":380,"y":471,"width":57,"height":7}},{"id":"a37ced15-5b78-40d5-a652-a25f6d448b93","block_type":"box","text":"Redemption","page_number":72,"box":{"x":371,"y":481,"width":76,"height":10}},{"id":"b05721a2-83a2-4dda-ab21-6bc9a53bd9de","block_type":"box","text":"Transaction Fee*","page_number":72,"box":{"x":355,"y":491,"width":108,"height":8}},{"id":"e29d1e63-7a5e-49c9-91bf-aab56d5c674a","block_type":"box","text":"Maximum Additional","page_number":72,"box":{"x":526,"y":481,"width":129,"height":8}},{"id":"112fe8de-b4cd-4647-8a81-78982b4b272c","block_type":"box","text":"Charge**","page_number":72,"box":{"x":563,"y":491,"width":56,"height":10}},{"id":"5c24d5af-8c2e-4768-9ddb-6287a57d7c99","block_type":"box","text":"$0.00 2%","page_number":72,"box":{"x":388,"y":509,"width":219,"height":12}},{"id":"8ded43db-705c-4360-b41e-081e89103fbf","block_type":"box","text":"* The standard redemption transaction fee consists of the ETF Servicing Fee and Custody Transaction Costs. The","page_number":72,"box":{"x":143,"y":559,"width":695,"height":10}},{"id":"0fb60fa2-2ce1-4645-9f3c-fd38418fdc41","block_type":"box","text":"standard redemption transaction fee may vary over time depending on the factors discussed above, and may be higher","page_number":72,"box":{"x":170,"y":572,"width":707,"height":10}},{"id":"59f12f9c-2373-416a-9f35-5a7e2a7b64f3","block_type":"box","text":"than the fee set forth above.","page_number":72,"box":{"x":170,"y":585,"width":166,"height":8}},{"id":"d2fc1d14-f955-443b-b0b6-6972ad27b574","block_type":"box","text":"** As a percentage of the net asset value per Creation Unit.","page_number":72,"box":{"x":143,"y":601,"width":364,"height":9}},{"id":"b5cf926c-832f-44a4-87f0-0de7d0dec414","block_type":"box","text":"Placement of Redemption Orders.","page_number":72,"box":{"x":117,"y":630,"width":269,"height":12}},{"id":"0546d227-6976-41f1-aecb-e2004116dccb","block_type":"box","text":"Redemption requests for Creation Units of the Fund must be","page_number":72,"box":{"x":387,"y":630,"width":460,"height":12}},{"id":"31b038e5-40b7-4087-9670-14c206c02594","block_type":"box","text":"submitted to the Distributor or its agent by or through an Authorized Participant. An Authorized","page_number":72,"box":{"x":116,"y":645,"width":705,"height":12}},{"id":"c816a965-31b2-4dee-9d2d-5aa1312e2688","block_type":"box","text":"Participant must submit an irrevocable request to redeem shares of the Fund generally before","page_number":72,"box":{"x":117,"y":661,"width":695,"height":12}},{"id":"cc5c6225-dd79-4811-9ea7-953564f27ccc","block_type":"box","text":"4:00 p.m., Eastern time on any Business Day","page_number":72,"box":{"x":116,"y":676,"width":337,"height":12}},{"id":"a09c2490-e9b5-4e30-8401-19eb1217ec88","block_type":"box","text":",","page_number":72,"box":{"x":454,"y":684,"width":2,"height":4}},{"id":"92d3a8f0-3a47-4522-a66a-5aa3c2006e0e","block_type":"box","text":"in order to receive that day’s NAV. On days when the","page_number":72,"box":{"x":463,"y":676,"width":394,"height":12}},{"id":"65958138-8548-4721-97ae-6ff2caa62cc2","block_type":"box","text":"Listing Exchange closes earlier than normal, the Fund may require orders to redeem Creation Units to","page_number":72,"box":{"x":117,"y":692,"width":756,"height":12}},{"id":"bf0a8e6d-623b-424d-a2f2-ccf52b85db7b","block_type":"box","text":"be placed earlier that day. Investors, other than Authorized Participants, are responsible for making","page_number":72,"box":{"x":117,"y":707,"width":735,"height":12}},{"id":"ac2e7901-be63-4ffb-aab6-d24784efe840","block_type":"box","text":"arrangements for a redemption request to be made through an Authorized Participant. The Distributor","page_number":72,"box":{"x":116,"y":723,"width":755,"height":12}},{"id":"b1507cf5-87b9-4d2b-9b9f-0993eafdc156","block_type":"box","text":"or its agent will provide a list of current Authorized Participants upon request.","page_number":72,"box":{"x":116,"y":738,"width":570,"height":12}},{"id":"72e48b61-dc08-4b42-a4d5-1ccc56b20821","block_type":"box","text":"The Authorized Participant must transmit the request for redemption in the form required by the Fund","page_number":72,"box":{"x":116,"y":769,"width":749,"height":12}},{"id":"e62ecd7f-1517-404b-8eca-7ea609adca95","block_type":"box","text":"to the Distributor or its agent in accordance with procedures set forth in the Authorized Participant","page_number":72,"box":{"x":116,"y":785,"width":725,"height":12}},{"id":"eba93de4-019a-4889-8e3b-1b58866b2fa2","block_type":"box","text":"Agreement. Investors should be aware that their particular broker may not have executed an","page_number":72,"box":{"x":116,"y":800,"width":686,"height":12}},{"id":"267e2c57-5c6d-4cd1-93b8-8e337d366c94","block_type":"box","text":"Authorized Participant Agreement and that, therefore, requests to redeem Creation Units may have to","page_number":72,"box":{"x":116,"y":816,"width":755,"height":12}},{"id":"ecd27202-8835-47f3-8dbb-50b708deaea1","block_type":"box","text":"be placed by the investor’s broker through an Authorized Participant who has executed an Authorized","page_number":72,"box":{"x":117,"y":831,"width":758,"height":12}},{"id":"73c21fc3-2704-43c0-a821-d74ac13864bd","block_type":"box","text":"Participant Agreement. At any time, only a limited number of broker-dealers will have an Authorized","page_number":72,"box":{"x":117,"y":847,"width":743,"height":12}},{"id":"3db108d6-8ae9-4d5f-a406-3ea186a8a99b","block_type":"box","text":"Participant Agreement in effect. Investors making a redemption request should be aware that such","page_number":72,"box":{"x":117,"y":862,"width":735,"height":12}},{"id":"6f53e40a-1704-4610-a283-a350af25714d","block_type":"box","text":"request must be in the form specified by such Authorized Participant. Investors making a request to","page_number":72,"box":{"x":117,"y":878,"width":742,"height":12}},{"id":"000e34a0-a1cd-4615-9aba-6c15a938c514","block_type":"box","text":"67","page_number":72,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"5d752243-92d9-4b11-b912-da2892dec97b","block_type":"box","text":"NM0926U-5926888-72/257","page_number":72,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"e5e8bb29-8a9a-4d2c-9a2b-3f5c0db55332","block_type":"box","text":"redeem Creation Units should allow sufficient time to permit proper submission of the request by an","page_number":73,"box":{"x":117,"y":87,"width":743,"height":12}},{"id":"ffdb3656-1b21-465b-98f9-58f5d3c0a054","block_type":"box","text":"Authorized Participant and transfer of the shares to the Fund’s transfer agent; such investors should","page_number":73,"box":{"x":116,"y":102,"width":748,"height":13}},{"id":"e116c778-deeb-4ba6-9372-a813ae6f5b83","block_type":"box","text":"allow for the additional time that may be required to effect redemptions through their banks, brokers or","page_number":73,"box":{"x":116,"y":118,"width":764,"height":12}},{"id":"d23c3de5-0bbb-4786-87d2-0bb16f182ca7","block_type":"box","text":"other financial intermediaries if such intermediaries are not Authorized Participants.","page_number":73,"box":{"x":116,"y":134,"width":623,"height":11}},{"id":"0965ef0f-b442-41db-a6a7-2235e0fb8bb2","block_type":"box","text":"A redemption request is considered to be in “proper form” if: (i) an Authorized Participant has","page_number":73,"box":{"x":116,"y":165,"width":694,"height":12}},{"id":"bdc5055d-d415-44c3-a494-b8bfaa670cdf","block_type":"box","text":"transferred or caused to be transferred to the Fund’s transfer agent the Creation Unit redeemed","page_number":73,"box":{"x":116,"y":180,"width":715,"height":12}},{"id":"bcdd3911-e423-4ca5-9b59-d54f345c805b","block_type":"box","text":"through the book-entry system of DTC so as to be effective by the Listing Exchange closing time on","page_number":73,"box":{"x":116,"y":196,"width":745,"height":12}},{"id":"0a43bd89-5a7f-49e5-ba8f-55bd289e06c6","block_type":"box","text":"any Business Day on which the redemption request is submitted; (ii) a request in form satisfactory to","page_number":73,"box":{"x":116,"y":211,"width":750,"height":12}},{"id":"d03ee28a-5f68-4b72-945b-d8595a99ecba","block_type":"box","text":"the Fund is received by the Distributor or its agent from the Authorized Participant on behalf of itself or","page_number":73,"box":{"x":116,"y":227,"width":763,"height":12}},{"id":"abb19486-774a-4e07-be68-b3f1b8853444","block_type":"box","text":"another redeeming investor within the time periods specified above; and (iii) all other procedures set","page_number":73,"box":{"x":116,"y":242,"width":748,"height":12}},{"id":"49515505-412e-4822-a2f8-f0996973aa29","block_type":"box","text":"forth in the Authorized Participant Agreement are properly followed.","page_number":73,"box":{"x":116,"y":258,"width":506,"height":12}},{"id":"a9a21ea2-3992-4b72-9e7f-cbe8076d852a","block_type":"box","text":"Upon receiving a redemption request, the Distributor or its agent shall notify the Fund and the Fund’s","page_number":73,"box":{"x":117,"y":289,"width":753,"height":12}},{"id":"8d110c32-fa31-4158-8cf6-80ed725e6ce4","block_type":"box","text":"transfer agent of such redemption request. The tender of an investor’s shares for redemption and the","page_number":73,"box":{"x":116,"y":304,"width":755,"height":12}},{"id":"6eef630c-7b77-44a6-83f3-f310d83264df","block_type":"box","text":"distribution of the securities and/or cash included in the redemption payment made in respect of","page_number":73,"box":{"x":116,"y":320,"width":716,"height":12}},{"id":"fb834d96-f205-4d45-bd0a-f1c1f48c92ad","block_type":"box","text":"Creation Units redeemed will be made through DTC and the relevant Authorized Participant to the","page_number":73,"box":{"x":117,"y":335,"width":731,"height":12}},{"id":"4d1bfe64-d86e-4f9e-9f66-1e44a9c02a47","block_type":"box","text":"Beneficial Owner thereof as recorded on the book-entry system of DTC or the DTC Participant through","page_number":73,"box":{"x":117,"y":351,"width":766,"height":12}},{"id":"0ffe1c8e-2af7-4e21-807f-5f24fe4d1a29","block_type":"box","text":"which such investor holds, as the case may be, or by such other means specified by the Authorized","page_number":73,"box":{"x":116,"y":366,"width":744,"height":12}},{"id":"5ea9655e-af01-49c7-9376-c35436768dd8","block_type":"box","text":"Participant submitting the redemption request.","page_number":73,"box":{"x":117,"y":382,"width":347,"height":12}},{"id":"a412b995-46db-4802-af79-1f041bf44dce","block_type":"box","text":"A redeeming Authorized Participant, whether on its own account or acting on behalf of a Beneficial","page_number":73,"box":{"x":116,"y":413,"width":736,"height":12}},{"id":"f0a52794-67b0-439e-9ad3-3c8b090217c2","block_type":"box","text":"Owner, must maintain appropriate security arrangements with a qualified broker-dealer, bank or other","page_number":73,"box":{"x":116,"y":428,"width":759,"height":12}},{"id":"1005cb78-e987-48cb-88db-57227946413c","block_type":"box","text":"custody providers in each jurisdiction in which any of the portfolio securities are customarily traded, to","page_number":73,"box":{"x":116,"y":444,"width":758,"height":12}},{"id":"5c857699-1222-438f-9136-be36831d30cf","block_type":"box","text":"which account such portfolio securities will be delivered.","page_number":73,"box":{"x":116,"y":459,"width":421,"height":12}},{"id":"511a0882-0781-4f51-8fea-3b7ef9bb7f7a","block_type":"box","text":"Deliveries of redemption proceeds by the Fund are generally made within two Business Days (i.e.,","page_number":73,"box":{"x":117,"y":490,"width":733,"height":12}},{"id":"25d3f93d-c0a8-44e2-952a-ce0ab881dc9e","block_type":"box","text":"“T+2”). However, the Fund reserves the right to settle redemption transactions on a basis other than","page_number":73,"box":{"x":116,"y":506,"width":747,"height":12}},{"id":"76ba92c1-d8bd-4e48-9297-a69f9a61a970","block_type":"box","text":"T+2, including a shorter settlement period, if necessary or appropriate under the circumstances and","page_number":73,"box":{"x":116,"y":521,"width":744,"height":12}},{"id":"b9dde6d0-a657-4050-aa6b-9214ad40c9a8","block_type":"box","text":"compliant with applicable law. Delayed settlement may occur due to a number of different reasons,","page_number":73,"box":{"x":116,"y":537,"width":738,"height":12}},{"id":"a9e51572-8ee8-40f3-9a21-59cbe4f0b5d2","block_type":"box","text":"including, without limitation, settlement cycles for the underlying securities, unscheduled market","page_number":73,"box":{"x":117,"y":552,"width":713,"height":12}},{"id":"d04e5b20-ab4d-4d7c-97d6-4bbf1543a9bd","block_type":"box","text":"closings, an effort to link distribution to dividend record dates and ex-dates and newly announced","page_number":73,"box":{"x":116,"y":568,"width":726,"height":12}},{"id":"3c7860d5-0532-44a7-98e1-6707580d0e1b","block_type":"box","text":"holidays. For example, the Fund reserves the right to settle redemption transactions on a basis other","page_number":73,"box":{"x":117,"y":583,"width":751,"height":12}},{"id":"2476b59f-7f2a-48d5-9187-3caeccef9f66","block_type":"box","text":"than T+2 in order to accommodate non-U.S. market holiday schedules, the occurrence of a holiday in","page_number":73,"box":{"x":116,"y":599,"width":757,"height":12}},{"id":"7a6773e9-0799-42c1-9368-0bc1d2a6deb2","block_type":"box","text":"the U.S. bond market that is not a holiday observed in the U.S. equity market, to account for different","page_number":73,"box":{"x":116,"y":614,"width":753,"height":12}},{"id":"fa799525-c1a2-47f0-bdee-4925664104d6","block_type":"box","text":"treatment among non-U.S. and U.S. markets of dividend record dates and dividend ex-dates (i.e., the","page_number":73,"box":{"x":116,"y":630,"width":757,"height":12}},{"id":"6ee79bd0-96b9-44d9-be03-8bd4edb9910b","block_type":"box","text":"last date the holder of a security can sell the security and still receive dividends payable on the security","page_number":73,"box":{"x":117,"y":645,"width":769,"height":12}},{"id":"b1e6b271-fd24-4281-b3e1-939a59d4a5a9","block_type":"box","text":"sold) and in certain other circumstances consistent with applicable law.","page_number":73,"box":{"x":116,"y":661,"width":526,"height":12}},{"id":"1036a9f1-ca04-4b51-ae63-30f69c525198","block_type":"box","text":"If the Fund includes a foreign investment in its basket, and if a local market holiday, or series of","page_number":73,"box":{"x":117,"y":692,"width":707,"height":12}},{"id":"7819a2a0-7eb1-412b-880d-9f8294345f8e","block_type":"box","text":"consecutive holidays, or the extended delivery cycles for transferring foreign investments to redeeming","page_number":73,"box":{"x":116,"y":707,"width":762,"height":12}},{"id":"0d90bf2d-cfda-4b2c-a426-521dcaa5ac6e","block_type":"box","text":"Authorized Participants prevents timely delivery of the foreign investment in response to a redemption","page_number":73,"box":{"x":116,"y":723,"width":755,"height":12}},{"id":"74972655-0126-4f80-b2b3-5a7a04417b9c","block_type":"box","text":"request, the Fund may delay delivery of the foreign investment more than seven days if the Fund","page_number":73,"box":{"x":117,"y":738,"width":717,"height":12}},{"id":"0b7183af-4b94-480f-8b14-02bb0d0673c4","block_type":"box","text":"delivers the foreign investment as soon as practicable, but in no event later than 15 days.","page_number":73,"box":{"x":116,"y":754,"width":662,"height":12}},{"id":"a4cfb122-60ee-4de7-b6b4-d00f5859ba17","block_type":"box","text":"If neither the Authorized Participant nor the Beneficial Owner on whose behalf the Authorized","page_number":73,"box":{"x":117,"y":785,"width":690,"height":12}},{"id":"87678b5f-5821-479e-8a1c-90ed2d7545fc","block_type":"box","text":"Participant is acting has appropriate arrangements to take delivery of Fund Securities in the applicable","page_number":73,"box":{"x":117,"y":800,"width":759,"height":12}},{"id":"6844784c-4306-439f-9a82-b57f8db806f9","block_type":"box","text":"non-U.S. jurisdiction and it is not possible to make other such arrangements, or if it is not possible to","page_number":73,"box":{"x":117,"y":816,"width":743,"height":12}},{"id":"3a3bf6d6-2569-4d09-a9e8-68599e75129f","block_type":"box","text":"effect deliveries of Fund Securities in such jurisdiction, the Fund may in its discretion exercise its option","page_number":73,"box":{"x":116,"y":831,"width":771,"height":12}},{"id":"f79763a3-eb69-4e60-b9eb-629c6cb8eab1","block_type":"box","text":"to redeem such shares in cash, and the Beneficial Owner will be required to receive its redemption","page_number":73,"box":{"x":116,"y":847,"width":737,"height":12}},{"id":"6ae2c21f-918c-46f2-b944-498ee1b24e52","block_type":"box","text":"proceeds in cash. In such case, the investor will receive a cash payment equal to the net asset value of","page_number":73,"box":{"x":117,"y":862,"width":771,"height":12}},{"id":"74b75083-afd2-4335-b22a-3fb4c2f9e086","block_type":"box","text":"its shares based on the NAV of the Fund next determined after the redemption request is received in","page_number":73,"box":{"x":117,"y":878,"width":751,"height":12}},{"id":"7a49bf40-c282-44d5-8182-eab584987beb","block_type":"box","text":"68","page_number":73,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"67c1ddf7-9bc3-42b6-83c1-ddbae8569079","block_type":"box","text":"NM0926U-5926888-73/257","page_number":73,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"cb45d1e9-8ac8-482b-a095-ef29b7655b4a","block_type":"box","text":"proper form (minus a redemption transaction fee and additional charges specified above to offset the","page_number":74,"box":{"x":117,"y":87,"width":752,"height":12}},{"id":"0a277c72-0714-46e8-b40d-71805ab35474","block_type":"box","text":"Fund’s brokerage and other transaction costs associated with the disposition of Fund Securities).","page_number":74,"box":{"x":117,"y":102,"width":724,"height":13}},{"id":"46e5cb21-ea91-43cd-a94a-557d1a1607ca","block_type":"box","text":"Redemptions of shares for Fund Securities will be subject to compliance with applicable U.S. federal","page_number":74,"box":{"x":117,"y":118,"width":749,"height":12}},{"id":"b4e5f0cb-828e-46e6-b4a7-74f404a3fa8f","block_type":"box","text":"and state securities laws and the Fund (whether or not it otherwise permits cash redemptions) reserves","page_number":74,"box":{"x":116,"y":134,"width":772,"height":12}},{"id":"58aa96ee-8df6-4436-8519-ac01f3d43615","block_type":"box","text":"the right to redeem Creation Units for cash to the extent that the Fund cannot lawfully deliver specific","page_number":74,"box":{"x":116,"y":149,"width":753,"height":12}},{"id":"fe92b847-18d2-45e0-8dd0-ba435c59ef7e","block_type":"box","text":"Fund Securities upon redemptions or cannot do so without first registering the Fund Securities under","page_number":74,"box":{"x":117,"y":165,"width":751,"height":12}},{"id":"abcecffa-6031-4bff-addb-ab63d513b989","block_type":"box","text":"such laws.","page_number":74,"box":{"x":116,"y":180,"width":83,"height":10}},{"id":"92a9ab43-8f51-4dfe-8f46-fc6030120ee8","block_type":"box","text":"To the extent contemplated by an Authorized Participant’s agreement with the Distributor or its agent,","page_number":74,"box":{"x":116,"y":211,"width":758,"height":12}},{"id":"001f17bf-61b9-40aa-b2d5-5a903fca9f60","block_type":"box","text":"in the event an Authorized Participant has submitted a redemption request in proper form but is unable","page_number":74,"box":{"x":117,"y":227,"width":766,"height":11}},{"id":"9204f947-4306-4295-9d11-2b34555322fd","block_type":"box","text":"to transfer all or part of the Creation Unit to be redeemed to the Fund, at or prior to the time specified","page_number":74,"box":{"x":116,"y":242,"width":754,"height":12}},{"id":"aeae386c-d86c-4f08-9498-61740c32e3ba","block_type":"box","text":"by the Fund or its custodian on the Business Day after the date of submission of redemption request,","page_number":74,"box":{"x":117,"y":258,"width":754,"height":12}},{"id":"50b72ce7-7777-4430-b398-5b52c585ac8d","block_type":"box","text":"the Distributor or its agent will accept the redemption request in reliance on the undertaking by the","page_number":74,"box":{"x":116,"y":273,"width":733,"height":12}},{"id":"3099e745-06da-4f71-b230-38324444162e","block_type":"box","text":"Authorized Participant to deliver the missing shares as soon as possible. Such undertaking shall be","page_number":74,"box":{"x":116,"y":289,"width":742,"height":12}},{"id":"e613fe7e-a8a1-4eea-a869-f34f8970cd61","block_type":"box","text":"secured by the Authorized Participant’s delivery and maintenance of collateral as set forth in the","page_number":74,"box":{"x":116,"y":304,"width":717,"height":12}},{"id":"7f73445d-221f-41e9-a9ea-f52baf8dfd5c","block_type":"box","text":"handbook for Authorized Participants. Such collateral must be delivered no later than the time specified","page_number":74,"box":{"x":117,"y":320,"width":771,"height":12}},{"id":"38484fb8-cb86-4667-9519-67ae804ba28a","block_type":"box","text":"by the Fund or its custodian on the Business Day after the date of submission of such redemption","page_number":74,"box":{"x":117,"y":335,"width":729,"height":12}},{"id":"c3702af6-1005-40f9-a81a-c2217a0108f8","block_type":"box","text":"request and shall be held by JPMorgan and marked-to-market daily. The fees of JPMorgan and any","page_number":74,"box":{"x":117,"y":351,"width":745,"height":12}},{"id":"98752ff3-4f02-49da-9f68-d50691c64ab8","block_type":"box","text":"sub-custodians in respect of the delivery, maintenance and redelivery of the collateral shall be payable","page_number":74,"box":{"x":116,"y":366,"width":766,"height":12}},{"id":"b1c96735-cfc5-41b0-905d-f9d861b46cbb","block_type":"box","text":"by the Authorized Participant. The Authorized Participant Agreement permits the Fund to acquire","page_number":74,"box":{"x":117,"y":382,"width":723,"height":12}},{"id":"8ecdbfb0-5de5-4c40-af1c-d472c6597d6d","block_type":"box","text":"shares of the Fund at any time and subjects the Authorized Participant to liability for any shortfall","page_number":74,"box":{"x":116,"y":397,"width":722,"height":12}},{"id":"db6a87df-d5e4-4508-8cc4-50a9f664822e","block_type":"box","text":"between the aggregate of the cost to the Fund of purchasing such shares, plus the value of the Cash","page_number":74,"box":{"x":117,"y":413,"width":753,"height":12}},{"id":"0ec0e578-04e4-4a67-8667-2269d25910e0","block_type":"box","text":"Amount, and the value of the collateral together with liability for related brokerage and other charges.","page_number":74,"box":{"x":116,"y":428,"width":754,"height":12}},{"id":"4c73a343-0762-4962-bbd8-0d1f8f045775","block_type":"box","text":"Because the portfolio securities of the Fund may trade on exchange(s) on days that the Listing","page_number":74,"box":{"x":117,"y":459,"width":705,"height":12}},{"id":"383471cd-68e2-4a12-9420-0b61c3174430","block_type":"box","text":"Exchange is closed or are otherwise not Business Days for the Fund, shareholders may not be able to","page_number":74,"box":{"x":117,"y":475,"width":763,"height":12}},{"id":"de5344f5-d33c-454c-b5cc-e535214aac8a","block_type":"box","text":"redeem their shares of the Fund, or purchase or sell shares of the Fund on the Listing Exchange on","page_number":74,"box":{"x":117,"y":490,"width":744,"height":12}},{"id":"4c6010b3-9623-40e4-9692-74398fdc0584","block_type":"box","text":"days when the NAV of the Fund could be significantly affected by events in the relevant non-U.S.","page_number":74,"box":{"x":116,"y":506,"width":725,"height":12}},{"id":"ad78b228-c443-4e6d-b512-d50799f47580","block_type":"box","text":"markets.","page_number":74,"box":{"x":117,"y":521,"width":68,"height":10}},{"id":"462f6dd1-4c42-4323-93fa-1e3955e5fc21","block_type":"box","text":"The right of redemption may be suspended or the date of payment postponed with respect to the Fund:","page_number":74,"box":{"x":116,"y":552,"width":771,"height":12}},{"id":"9dfbbad5-889f-46a8-9df4-88f3e77825b6","block_type":"box","text":"(i) for any period during which the Listing Exchange is closed (other than customary weekend and","page_number":74,"box":{"x":117,"y":568,"width":729,"height":12}},{"id":"d518f035-f0f2-411e-912f-587f0368bd2e","block_type":"box","text":"holiday closings); (ii) for any period during which trading on the Listing Exchange is suspended or","page_number":74,"box":{"x":117,"y":583,"width":726,"height":12}},{"id":"984f4354-2462-4488-b7e2-bab44de91844","block_type":"box","text":"restricted; (iii) for any period during which an emergency exists as a result of which disposal of the","page_number":74,"box":{"x":117,"y":599,"width":732,"height":12}},{"id":"9940930f-0d88-40d7-b2b6-512af1a5168a","block_type":"box","text":"shares of the Fund’s portfolio securities or determination of its NAV is not reasonably practicable; or","page_number":74,"box":{"x":116,"y":614,"width":745,"height":12}},{"id":"0d4bfeee-8c03-45d8-bfa2-5e723cb65e71","block_type":"box","text":"(iv) in such other circumstance as is permitted by the SEC.","page_number":74,"box":{"x":117,"y":630,"width":441,"height":12}},{"id":"ef6682eb-e701-4a5a-8906-3fbac38476c1","block_type":"box","text":"Custom Baskets.","page_number":74,"box":{"x":116,"y":661,"width":133,"height":9}},{"id":"9cb988b2-912f-4357-b213-a0029e429617","block_type":"box","text":"Creation and Redemption baskets may differ and the Fund will accept “custom","page_number":74,"box":{"x":255,"y":661,"width":570,"height":12}},{"id":"71a4f245-65e7-4916-a37c-732c1e571a7c","block_type":"box","text":"baskets.” A custom basket may include any of the following: (i) a basket that is composed of a","page_number":74,"box":{"x":117,"y":676,"width":681,"height":12}},{"id":"6175133c-31d0-4580-8a9d-56234333002d","block_type":"box","text":"non-representative selection of the Fund’s portfolio holdings","page_number":74,"box":{"x":117,"y":692,"width":433,"height":12}},{"id":"1e672b42-cbab-4089-86ae-7a42994ed9c0","block_type":"box","text":"; (ii) a representative basket that is different","page_number":74,"box":{"x":552,"y":692,"width":314,"height":12}},{"id":"2ca6ae1e-1ec8-431d-a968-1d96477a3ca0","block_type":"box","text":"from the initial basket used in transactions on the sa","page_number":74,"box":{"x":116,"y":707,"width":378,"height":10}},{"id":"d6b0f42f-dc1a-4dfa-b1f7-1871713b248f","block_type":"box","text":"me business day; or (iii) a basket that contains","page_number":74,"box":{"x":495,"y":707,"width":337,"height":12}},{"id":"2b94f945-e75f-4013-be62-33f2664a8c02","block_type":"box","text":"bespoke cash substitutions for a single Authorized Participant. The Fund has adopted policies and","page_number":74,"box":{"x":117,"y":723,"width":712,"height":12}},{"id":"df536412-905b-4500-8c93-3b58d2317cbd","block_type":"box","text":"procedures that govern the construction and acc","page_number":74,"box":{"x":117,"y":738,"width":351,"height":12}},{"id":"4aea527e-8ec3-49ea-b6bd-c267aaa74217","block_type":"box","text":"eptance of baskets, including heightened requirements","page_number":74,"box":{"x":469,"y":738,"width":398,"height":12}},{"id":"b2f46531-7de3-4de6-91a2-0e35aa5c04c7","block_type":"box","text":"for certain types of custom baskets. Such polic","page_number":74,"box":{"x":116,"y":754,"width":339,"height":12}},{"id":"106450a9-740d-4080-9f9a-fd637c2cbe40","block_type":"box","text":"ies and procedures provide the parameters for the","page_number":74,"box":{"x":456,"y":754,"width":364,"height":12}},{"id":"aea4f741-3d7c-43c5-b0d9-7e1e1c9a4b2c","block_type":"box","text":"construction and acceptance of custom baskets t","page_number":74,"box":{"x":116,"y":769,"width":356,"height":12}},{"id":"23cd5d00-b5a8-42d0-b26a-170667fbe6e1","block_type":"box","text":"hat are in the best interests of the Fund and its","page_number":74,"box":{"x":473,"y":769,"width":338,"height":10}},{"id":"4549c3ca-05e2-4188-957a-81ed7330b1c6","block_type":"box","text":"shareholders, establish processes for revisions to,","page_number":74,"box":{"x":116,"y":785,"width":363,"height":12}},{"id":"acb3ca3a-1e87-4747-9391-c0e0a432496e","block_type":"box","text":"or deviations from, such parameters, and specify the","page_number":74,"box":{"x":486,"y":785,"width":381,"height":12}},{"id":"3dd043c2-2c59-4e66-9778-1c4570737553","block_type":"box","text":"titles and roles of the employees of BFA who are r","page_number":74,"box":{"x":116,"y":800,"width":364,"height":12}},{"id":"7f8d41f3-28e6-406b-8dab-21815a01d53a","block_type":"box","text":"equired to review each custom basket for compliance","page_number":74,"box":{"x":480,"y":800,"width":388,"height":12}},{"id":"98cb077c-c744-484f-8ec1-c86b7174a310","block_type":"box","text":"with those parameters. In addition, when constructing","page_number":74,"box":{"x":116,"y":816,"width":388,"height":12}},{"id":"d21163e1-e10b-4c8c-abda-06938a878176","block_type":"box","text":"custom baskets for redemptions, the tax efficiency","page_number":74,"box":{"x":510,"y":816,"width":364,"height":12}},{"id":"05750e4e-b2c5-400f-95c6-d489413d346f","block_type":"box","text":"of the Fund may be taken into account. The policies and","page_number":74,"box":{"x":116,"y":831,"width":413,"height":12}},{"id":"929174e7-bb93-4a56-b880-46e7b2804271","block_type":"box","text":"procedures distinguish among different types of","page_number":74,"box":{"x":530,"y":831,"width":350,"height":12}},{"id":"5c804794-446c-4bea-8c63-7c3573768fb4","block_type":"box","text":"custom baskets that may be used for the Fund and impos","page_number":74,"box":{"x":116,"y":847,"width":419,"height":12}},{"id":"021efd98-ef47-4d49-99f6-43b6dd68b7b8","block_type":"box","text":"e different requirements for different types of","page_number":74,"box":{"x":536,"y":847,"width":328,"height":12}},{"id":"490f6ab3-dce9-408c-a40e-12c1ac9ef536","block_type":"box","text":"custom baskets in order to seek to mitigate agains","page_number":74,"box":{"x":116,"y":862,"width":365,"height":12}},{"id":"6ce3d8b9-538e-42b5-9672-c7d9518fc3bc","block_type":"box","text":"t potential risks of conflicts and/or overreaching by an","page_number":74,"box":{"x":482,"y":862,"width":392,"height":12}},{"id":"51e24384-95b6-40c8-b769-3df772b5b436","block_type":"box","text":"69","page_number":74,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"ec5a2bb8-c243-4c28-9f0c-1c52d0d64ee4","block_type":"box","text":"NM0926U-5926888-74/257","page_number":74,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"fa75f320-1be6-461a-a3ba-c50d8bce83a8","block_type":"box","text":"Authorized Participant. BlackRock has established a governance process to oversee basket compliance","page_number":75,"box":{"x":116,"y":87,"width":760,"height":12}},{"id":"7204501d-26bb-4135-8d6b-f49e244df103","block_type":"box","text":"for the Fund, as set forth in the Fund’s policies and procedures.","page_number":75,"box":{"x":116,"y":102,"width":465,"height":12}},{"id":"080356df-707d-472e-a9a5-7cbe7d07b682","block_type":"box","text":"Taxation on Creations and Redemptions of Creation Units.","page_number":75,"box":{"x":116,"y":132,"width":466,"height":12}},{"id":"43ee569b-701b-41a9-b082-4230cb3514e6","block_type":"box","text":"An Authorized Participant generally will","page_number":75,"box":{"x":583,"y":132,"width":301,"height":12}},{"id":"69cf5b68-4ba3-4651-b50b-14e709ead99d","block_type":"box","text":"recognize either gain or loss upon the exchange of Deposit Securities for Creation Units. This gain or","page_number":75,"box":{"x":117,"y":147,"width":754,"height":13}},{"id":"9fdad6b1-7dd4-44bb-8eb5-3e6aa345d077","block_type":"box","text":"loss is calculated by taking the market value of the Creation Units purchased over the Authorized","page_number":75,"box":{"x":117,"y":163,"width":724,"height":12}},{"id":"69014909-f1cd-4e4d-85f9-c7d2d7b01579","block_type":"box","text":"Participant’s aggregate basis in the Deposit Securities exchanged therefor. However, the IRS may","page_number":75,"box":{"x":117,"y":178,"width":733,"height":13}},{"id":"b42d5845-bd81-464d-84f8-e7e82bfa62bc","block_type":"box","text":"apply the wash sales rules to determine that any loss realized upon the exchange of Deposit Securities","page_number":75,"box":{"x":116,"y":194,"width":770,"height":12}},{"id":"f3273cb5-6fab-4358-ad80-40dc8b815242","block_type":"box","text":"for Creation Units is not currently deductible. Authorized Participants should consult their own tax","page_number":75,"box":{"x":116,"y":209,"width":726,"height":13}},{"id":"d28bb7c5-b2ca-4cb3-bb9f-15b8e61af6e6","block_type":"box","text":"advisors.","page_number":75,"box":{"x":116,"y":225,"width":72,"height":9}},{"id":"c144c71a-f826-4a61-aaff-acebb653aa35","block_type":"box","text":"Similarly, an Authorized Participant generally will recognize either gain or loss upon the redemption of","page_number":75,"box":{"x":116,"y":254,"width":759,"height":12}},{"id":"cc94ca98-b65c-40b3-97f8-e5ed9223168f","block_type":"box","text":"the Creation Units. If the Creation Units are held as capital assets, current U.S. federal income tax laws","page_number":75,"box":{"x":116,"y":270,"width":772,"height":12}},{"id":"f3e6976b-57aa-4425-a332-84d10e3b8826","block_type":"box","text":"dictate that capital gain or loss realized from the redemption of the Creation Units will generally create","page_number":75,"box":{"x":116,"y":285,"width":760,"height":12}},{"id":"a74578e5-d78d-465a-aed5-e969fea415ae","block_type":"box","text":"long-term capital gain or loss if the Authorized Participant held the Creation Units for more than one","page_number":75,"box":{"x":117,"y":301,"width":743,"height":12}},{"id":"a19faf3d-648d-4f37-b460-19c14e8c440a","block_type":"box","text":"year and short-term capital gain or loss if the Authorized Participant held the Creation Units for one","page_number":75,"box":{"x":116,"y":316,"width":739,"height":12}},{"id":"bb85881e-23c3-4bba-9738-469609888ac9","block_type":"box","text":"year or less.","page_number":75,"box":{"x":116,"y":332,"width":96,"height":12}},{"id":"f231fefa-317a-452c-bfac-16e5572fedf1","block_type":"box","text":"Taxes","page_number":75,"box":{"x":117,"y":380,"width":120,"height":23}},{"id":"4158b95b-de0e-4f50-ab8b-1c40b7541601","block_type":"box","text":"The following is a summary of certain material U.S. federal income tax considerations regarding the","page_number":75,"box":{"x":116,"y":430,"width":743,"height":12}},{"id":"09911e04-0d7e-48c5-a241-114d576eb449","block_type":"box","text":"purchase, ownership and disposition of shares of the Fund. This summary does not address all of the","page_number":75,"box":{"x":117,"y":445,"width":757,"height":12}},{"id":"aa792f96-10a5-43aa-8df3-6107321d42d6","block_type":"box","text":"potential U.S. federal income tax consequences that may be applicable to the Fund or to all categories","page_number":75,"box":{"x":117,"y":461,"width":765,"height":12}},{"id":"8df0fb28-cd70-4f14-b190-ea8edd673654","block_type":"box","text":"of investors, some of which may be subject to special tax rules. Current and prospective shareholders","page_number":75,"box":{"x":116,"y":476,"width":761,"height":12}},{"id":"d4e75abf-f777-4ef5-b53e-e720e289097b","block_type":"box","text":"are urged to consult their own tax advisors with respect to the specific federal, state, local and","page_number":75,"box":{"x":116,"y":492,"width":702,"height":12}},{"id":"316e38d8-c9f0-4ffd-8f8f-4131592ff5ee","block_type":"box","text":"non-U.S. tax consequences of investing in the Fund. The summary is based on the laws and judicial","page_number":75,"box":{"x":117,"y":507,"width":747,"height":12}},{"id":"b65b2e46-ec0c-44e2-959f-140568b01ca5","block_type":"box","text":"and administrative interpretations thereof in effect on the date of this SAI, all of which are subject to","page_number":75,"box":{"x":116,"y":523,"width":742,"height":12}},{"id":"2e8c2709-7cb0-44f2-b9a3-485cf3c97a02","block_type":"box","text":"change, possibly with retroactive effect.","page_number":75,"box":{"x":116,"y":538,"width":298,"height":12}},{"id":"d830a586-8ed9-4c45-8be9-ae141b5854a2","block_type":"box","text":"Regulated Investment Company Qualifications.","page_number":75,"box":{"x":117,"y":567,"width":374,"height":13}},{"id":"ce77ec6f-0409-4c1f-862f-c1ec294490fc","block_type":"box","text":"The Fund intends to continue to qualify for and to","page_number":75,"box":{"x":493,"y":567,"width":375,"height":13}},{"id":"db7b8673-c6b5-4be9-9d92-5a8cd58dc599","block_type":"box","text":"elect treatment as a separate RIC under Subchapter M of the Internal Revenue Code. To qualify for","page_number":75,"box":{"x":116,"y":583,"width":745,"height":12}},{"id":"3f9f6461-8d5a-40c8-89a1-3ec2ac3cbc43","block_type":"box","text":"treatment as a RIC, the Fund must annually distribute at least 90% of its investment company taxable","page_number":75,"box":{"x":116,"y":598,"width":759,"height":13}},{"id":"472157c4-fbdc-4273-a844-47362f04e796","block_type":"box","text":"income (which includes dividends, interest and net short-term capital gains) and meet several other","page_number":75,"box":{"x":117,"y":614,"width":741,"height":12}},{"id":"4ba4f6bc-e641-4de1-88d3-22c30191db46","block_type":"box","text":"requirements. Among such other requirements are the following: (i) at least 90% of the Fund’s annual","page_number":75,"box":{"x":117,"y":629,"width":757,"height":13}},{"id":"06023942-8bd8-4bc1-af27-55e292c43302","block_type":"box","text":"gross income must be derived from dividends, interest, payments with respect to securities loans,","page_number":75,"box":{"x":116,"y":645,"width":729,"height":12}},{"id":"713b6672-fcfc-4423-8689-693575b6f1bb","block_type":"box","text":"gains from the sale or other disposition of stock or securities or non-U.S. currencies, other income","page_number":75,"box":{"x":116,"y":661,"width":726,"height":12}},{"id":"cba5fb45-3df4-47fb-b034-f000034d4652","block_type":"box","text":"(including, but not limited to, gains from options, futures or forward contracts) derived with respect to its","page_number":75,"box":{"x":117,"y":676,"width":765,"height":12}},{"id":"88313f1e-6e98-4e0f-ac58-0e717ba8e59e","block_type":"box","text":"business of investing in such stock, securities or currencies, and net income derived from interests in","page_number":75,"box":{"x":117,"y":692,"width":747,"height":12}},{"id":"ce49726e-f82c-4adc-8a80-c1db8d4dcc78","block_type":"box","text":"qualified publicly-traded partnerships (i.e., partnerships that are traded on an established securities","page_number":75,"box":{"x":116,"y":707,"width":734,"height":12}},{"id":"1a88646e-20f9-48b7-bbc5-011e4cb43a42","block_type":"box","text":"market or tradable on a secondary market, other than a partnership that derives at least 90% of its","page_number":75,"box":{"x":117,"y":723,"width":728,"height":12}},{"id":"cad89bae-adc8-411c-be50-70e67184a0ae","block_type":"box","text":"income from interest, dividends, capital gains and other traditionally permitted RIC income); and (ii) at","page_number":75,"box":{"x":117,"y":738,"width":753,"height":12}},{"id":"6818870d-5929-4f35-9dc6-eb27761bb696","block_type":"box","text":"the close of each quarter of the Fund’s taxable year, (a) at least 50% of the market value of the Fund’s","page_number":75,"box":{"x":116,"y":754,"width":760,"height":12}},{"id":"c910badd-02ab-4ebe-ac54-003591fcb67b","block_type":"box","text":"total assets must be represented by cash and cash items, U.S. government securities, securities of","page_number":75,"box":{"x":116,"y":769,"width":736,"height":12}},{"id":"84c7b680-f30e-4371-8b02-b72e59466daa","block_type":"box","text":"other RICs and other securities, with such other securities limited for purposes of this calculation in","page_number":75,"box":{"x":116,"y":785,"width":732,"height":12}},{"id":"d80b20dc-e893-4efd-b43b-50f7dbb743b3","block_type":"box","text":"respect of any one issuer to an amount not greater than 5% of the value of the Fund’s assets and not","page_number":75,"box":{"x":117,"y":800,"width":750,"height":12}},{"id":"1624efb5-eebc-470d-8083-f0d2a82edf2c","block_type":"box","text":"greater than 10% of the outstanding voting securities of such issuer, and (b) not more than 25% of the","page_number":75,"box":{"x":116,"y":816,"width":758,"height":12}},{"id":"d153a86e-2bca-4d9a-8044-889b87c69631","block_type":"box","text":"value of the Fund’s total assets may be invested in the securities of any one issuer, of two or more","page_number":75,"box":{"x":116,"y":831,"width":735,"height":12}},{"id":"6034492b-bec2-4a59-b87b-95699515bf6c","block_type":"box","text":"issuers of which 20% or more of the voting stock is held by the Fund and that are engaged in the same","page_number":75,"box":{"x":117,"y":847,"width":768,"height":12}},{"id":"a09628cf-301a-415d-8e1f-07337ae6285f","block_type":"box","text":"or similar trades or businesses or related trades or businesses (other than the securities of other RICs)","page_number":75,"box":{"x":116,"y":862,"width":768,"height":12}},{"id":"48d5d627-8f38-4188-9a0d-66d69dab6cf2","block_type":"box","text":"or the securities of one or more qualified publicly-traded partnerships.","page_number":75,"box":{"x":116,"y":878,"width":521,"height":12}},{"id":"62abe36e-5a27-4140-bb52-fb7572fc8731","block_type":"box","text":"70","page_number":75,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"f6b072f6-8f6c-4fe3-93de-9a72e32f3400","block_type":"box","text":"NM0926U-5926888-75/257","page_number":75,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"ea28ffff-942c-40e0-b767-29cb8f8ff7b8","block_type":"box","text":"The Fund may be able to cure a failure to derive at least 90% of its income from the sources specified","page_number":76,"box":{"x":116,"y":87,"width":761,"height":12}},{"id":"e242c1d8-c260-4f85-90a3-639d9e2c3f84","block_type":"box","text":"above or a failure to diversify its holdings in the manner described above by paying a tax and/or by","page_number":76,"box":{"x":116,"y":102,"width":737,"height":13}},{"id":"e721aeb8-24a8-4f4f-8d96-39f7ca954a61","block_type":"box","text":"disposing of certain assets. If, in any taxable year, the Fund fails one of these tests and does not timely","page_number":76,"box":{"x":116,"y":118,"width":771,"height":12}},{"id":"85521df7-f895-4b5a-8c8c-a1ae522ba4e9","block_type":"box","text":"cure the failure, that Fund will be taxed in the same manner as an ordinary corporation and","page_number":76,"box":{"x":116,"y":134,"width":680,"height":12}},{"id":"542daf40-8758-4d22-97b5-c92e64f40e98","block_type":"box","text":"distributions to its shareholders will not be deductible by that Fund in computing its taxable income.","page_number":76,"box":{"x":116,"y":149,"width":740,"height":12}},{"id":"c1117662-a2c0-49a0-8894-2336038f162b","block_type":"box","text":"Although in general the passive loss rules of the Internal Revenue Code do not apply to RICs, such","page_number":76,"box":{"x":116,"y":183,"width":742,"height":12}},{"id":"1027e0c7-8836-4770-9454-a341fb97839b","block_type":"box","text":"rules do apply to a RIC with respect to items attributable to an interest in a qualified publicly-traded","page_number":76,"box":{"x":117,"y":199,"width":736,"height":12}},{"id":"af784ac3-39a1-4ff0-9b6d-ecafd080de40","block_type":"box","text":"partnership. The Fund’s investments in partnerships, including in qualified publicly-traded partnerships,","page_number":76,"box":{"x":117,"y":214,"width":767,"height":12}},{"id":"3a59e646-304a-433a-b9d0-0891609b1515","block_type":"box","text":"may result in the Fund being subject to state, local, or non-U.S. income, franchise or withholding tax","page_number":76,"box":{"x":117,"y":230,"width":745,"height":12}},{"id":"1164c86e-0711-458a-99c7-1a0ed982aae3","block_type":"box","text":"liabilities.","page_number":76,"box":{"x":117,"y":245,"width":72,"height":10}},{"id":"7fbd0a55-e236-4179-93ab-ef720f50e6c9","block_type":"box","text":"Taxation of RICs.","page_number":76,"box":{"x":116,"y":279,"width":136,"height":10}},{"id":"be244057-5637-49b5-95bf-9a8ff1263e76","block_type":"box","text":"As a RIC, the Fund will not be subject to U.S. federal income tax on the portion of","page_number":76,"box":{"x":253,"y":279,"width":615,"height":12}},{"id":"d5b3e2f3-4579-4519-bd92-9fdfeec6e642","block_type":"box","text":"its taxable investment income and capital gains that it distributes to its shareholders, provided that it","page_number":76,"box":{"x":117,"y":295,"width":744,"height":12}},{"id":"25fd7d8d-1a8b-4296-8164-655c93a72cab","block_type":"box","text":"satisfies a minimum distribution requirement. To satisfy the minimum distribution requirement, the Fund","page_number":76,"box":{"x":116,"y":310,"width":772,"height":12}},{"id":"700131ab-b42e-4903-b4a9-920763403d59","block_type":"box","text":"must distribute to its shareholders at least the sum of (i) 90% of its “investment company taxable","page_number":76,"box":{"x":117,"y":326,"width":720,"height":12}},{"id":"15eaef7c-55e1-4047-bb11-9a34a7c0e647","block_type":"box","text":"income” (i.e., income other than the excess of its net realized long-term capital gain over its net","page_number":76,"box":{"x":117,"y":341,"width":710,"height":12}},{"id":"c0d166d2-bb3b-4cc4-acae-11ae1070ffee","block_type":"box","text":"realized short-term capital loss), plus or minus certain adjustments, and (ii) 90% of its net tax-exempt","page_number":76,"box":{"x":117,"y":357,"width":753,"height":12}},{"id":"5cf82ade-d3da-400a-badb-e2ac779b8525","block_type":"box","text":"income for the taxable year. The Fund will be subject to income tax at regular corporate rates on any","page_number":76,"box":{"x":117,"y":372,"width":751,"height":12}},{"id":"def1810a-4400-4cb3-87f8-66d003387543","block_type":"box","text":"taxable income or gains that it does not distribute to","page_number":76,"box":{"x":116,"y":388,"width":389,"height":12}},{"id":"a62c4fa2-a5cb-41c7-9086-cbdc95aedb81","block_type":"box","text":"its shareholders. If the Fund fails to qualify for any","page_number":76,"box":{"x":506,"y":388,"width":375,"height":12}},{"id":"fe2504f7-371e-417c-abd4-32a2baeb3553","block_type":"box","text":"taxable year as a RIC or fails to meet the distribution requirement, all of its taxable income will be","page_number":76,"box":{"x":116,"y":403,"width":726,"height":12}},{"id":"31436e5f-2e18-455e-b221-71f90f5435b6","block_type":"box","text":"subject to tax at regular corporate income tax rates without any deduction for distributions to","page_number":76,"box":{"x":116,"y":419,"width":689,"height":12}},{"id":"5fb1ea14-3d7d-4a66-aab9-220c285c2a5b","block_type":"box","text":"shareholders, and such distributions generally will be taxable to shareholders as ordinary dividends to","page_number":76,"box":{"x":116,"y":434,"width":760,"height":12}},{"id":"7af41264-9c4a-4f02-b526-68ace33528f8","block_type":"box","text":"the extent of the Fund’s current and accumulated earnings and profits. In such event, distributions to","page_number":76,"box":{"x":116,"y":450,"width":750,"height":12}},{"id":"c162e6a2-92fd-41be-b9c3-f505838542b4","block_type":"box","text":"individuals should be eligible to be treated as qualified dividend income and distributions to corporate","page_number":76,"box":{"x":117,"y":465,"width":753,"height":12}},{"id":"21cefcd8-c939-4cb6-be02-297ee995bc96","block_type":"box","text":"shareholders generally should be eligible for the dividends-received deduction. Although the Fund","page_number":76,"box":{"x":116,"y":481,"width":731,"height":12}},{"id":"f74258d7-9370-4ac9-b355-e95eb660a03b","block_type":"box","text":"intends to distribute substantially all of its net investment income and its capital gains for each taxable","page_number":76,"box":{"x":117,"y":496,"width":758,"height":12}},{"id":"614521bb-9d4b-47ad-acbf-a796468b8a14","block_type":"box","text":"year, the Fund may decide to retain a portion of its income or gains. The Fund will be subject to U.S.","page_number":76,"box":{"x":116,"y":512,"width":750,"height":12}},{"id":"d6e5e57d-66c3-499c-a77d-18d9570819fb","block_type":"box","text":"federal income taxation and excise taxation (as described below) to the extent it does not distribute all","page_number":76,"box":{"x":116,"y":527,"width":761,"height":12}},{"id":"b7e69d8e-ada7-4c59-bd9a-2ac2586091e7","block_type":"box","text":"(or, in the case of the excise tax, substantially all) of such income or gains. In certain circumstances,","page_number":76,"box":{"x":117,"y":543,"width":748,"height":12}},{"id":"1c516806-3a6d-40a6-9129-9aefe4bede53","block_type":"box","text":"including in instances where the operational cost of the distribution would exceed the amount of the","page_number":76,"box":{"x":117,"y":558,"width":741,"height":12}},{"id":"51b4d4c5-0a03-4a9f-8520-b9008adaa0fe","block_type":"box","text":"income or excise tax, BFA or an affiliate may voluntarily pay the tax on behalf of the Fund or reimburse","page_number":76,"box":{"x":117,"y":574,"width":767,"height":12}},{"id":"948fefff-802f-4414-9d83-1f8cfa974c4d","block_type":"box","text":"the Fund for the tax. Moreover, if the Fund fails to qualify","page_number":76,"box":{"x":116,"y":589,"width":427,"height":12}},{"id":"8fbd880f-6a02-48a3-931d-62ae4fdc7bd4","block_type":"box","text":"as a RIC in any year, it must pay out its","page_number":76,"box":{"x":543,"y":589,"width":297,"height":12}},{"id":"7ef688ba-8c36-473d-8968-c79206481f82","block_type":"box","text":"earnings and profits accumulated in that year in order to","page_number":76,"box":{"x":116,"y":605,"width":421,"height":12}},{"id":"6913cc68-5ee6-4044-8fd1-e2976f230589","block_type":"box","text":"qualify again as a RIC. If the Fund fails to","page_number":76,"box":{"x":538,"y":605,"width":311,"height":12}},{"id":"5527ed68-0fa2-4012-9e6f-442aade7325e","block_type":"box","text":"qualify as a RIC for a period greater than two taxable years, the Fund may be required to recognize","page_number":76,"box":{"x":116,"y":620,"width":743,"height":12}},{"id":"5a518a03-e15b-49ce-9f0b-6e9f2171fce4","block_type":"box","text":"any net built-in gains with respect to certain of its assets (i.e., the excess of the aggregate gains,","page_number":76,"box":{"x":116,"y":636,"width":721,"height":12}},{"id":"d77cdd18-bb78-424c-8083-dcf27304e6b2","block_type":"box","text":"including items of income, over aggregate losses that would have been realized with respect to such","page_number":76,"box":{"x":117,"y":651,"width":749,"height":12}},{"id":"80009933-fc91-4897-a74a-929ce956c6d6","block_type":"box","text":"assets if the Fund had been liquidated) if it qualifies as a RIC in a subsequent year.","page_number":76,"box":{"x":116,"y":667,"width":617,"height":12}},{"id":"db4e11f8-21df-4bc9-991b-6e66ddc249b4","block_type":"box","text":"Net Capital Loss Carryforwards.","page_number":76,"box":{"x":117,"y":701,"width":254,"height":12}},{"id":"efb69e4b-fd5c-4126-b0ec-8381b35b6af5","block_type":"box","text":"Net capital loss carryforwards may be applied against any net","page_number":76,"box":{"x":378,"y":701,"width":457,"height":12}},{"id":"70995877-74eb-43e8-87ad-42b827168dac","block_type":"box","text":"realized capital gains in each succeeding year, until they have been reduced to zero.","page_number":76,"box":{"x":117,"y":717,"width":627,"height":12}},{"id":"9d8fa914-7a67-454d-a599-8ac7972b95a9","block_type":"box","text":"In the event that the Fund were to experience an ownership change as defined under the Internal","page_number":76,"box":{"x":117,"y":751,"width":720,"height":12}},{"id":"6505b34e-2f74-47f6-b66f-8a5745dcad2c","block_type":"box","text":"Revenue Code, the loss carryforwards and other favorable tax attributes of the Fund, if any, may be","page_number":76,"box":{"x":117,"y":766,"width":740,"height":12}},{"id":"c93f793e-7a2b-49c3-8882-bde5e4cf51b8","block_type":"box","text":"subject to limitation.","page_number":76,"box":{"x":116,"y":782,"width":146,"height":12}},{"id":"4ff579b0-dd9f-459c-b850-999c1afce828","block_type":"box","text":"Excise Tax.","page_number":76,"box":{"x":117,"y":816,"width":89,"height":9}},{"id":"36ed21ac-9d61-4650-a30e-dec3e1dafbb8","block_type":"box","text":"The Fund will be subject to a 4% excise tax on certain undistributed income if it does not","page_number":76,"box":{"x":212,"y":816,"width":657,"height":12}},{"id":"0f66426f-1cc3-457e-9204-e230a555c79c","block_type":"box","text":"distribute to its shareholders in each calendar year at least 98% of its ordinary income for the calendar","page_number":76,"box":{"x":116,"y":831,"width":764,"height":12}},{"id":"b96798fd-7782-4d2a-ac05-e9b188cdd459","block_type":"box","text":"year plus at least 98.2% of its capital gain net","page_number":76,"box":{"x":116,"y":847,"width":342,"height":12}},{"id":"394d619f-95fc-436c-afdd-a612c5bc07e2","block_type":"box","text":"income for the 12 months ended October 31 of such","page_number":76,"box":{"x":459,"y":847,"width":393,"height":9}},{"id":"3fcaf15a-3c9c-400a-8124-ea348d040b6d","block_type":"box","text":"year. For this purpose, however, any ordinary income or capital gain net income retained by the Fund","page_number":76,"box":{"x":116,"y":862,"width":758,"height":12}},{"id":"74e87293-09f2-41fa-b900-34d9752ee71e","block_type":"box","text":"that is subject to corporate income tax will be considered to have been distributed by year-end. In","page_number":76,"box":{"x":116,"y":878,"width":728,"height":12}},{"id":"57931e4c-73c7-487c-bb39-bf5342bb74a8","block_type":"box","text":"71","page_number":76,"box":{"x":491,"y":909,"width":15,"height":9}},{"id":"101f32ba-097a-4f64-88cd-86451fa885bf","block_type":"box","text":"NM0926U-5926888-76/257","page_number":76,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"b5b5c105-e4f7-4690-8f0e-561ae94d4062","block_type":"box","text":"addition, the minimum amounts that must be distributed in any year to avoid the excise tax will be","page_number":77,"box":{"x":116,"y":87,"width":728,"height":12}},{"id":"8a1d404c-74af-41ab-907f-e504d8e6ced3","block_type":"box","text":"increased or decreased to reflect any underdistribution or overdistribution, as the case may be, from","page_number":77,"box":{"x":117,"y":102,"width":746,"height":13}},{"id":"04397f7b-f095-4a5f-bb49-34f1428c3c55","block_type":"box","text":"the previous year.","page_number":77,"box":{"x":116,"y":118,"width":138,"height":12}},{"id":"304bc2ce-b19c-4159-bb65-221f3cf08f6e","block_type":"box","text":"Taxation of U.S. Shareholders.","page_number":77,"box":{"x":116,"y":146,"width":243,"height":9}},{"id":"b58b0b60-1736-414b-a2ff-4d4ff76bf162","block_type":"box","text":"Dividends and other distributions by the Fund are generally treated","page_number":77,"box":{"x":360,"y":146,"width":506,"height":12}},{"id":"f029c74f-0e95-40ef-aab2-49659dfc61da","block_type":"box","text":"under the Internal Revenue Code as received by the shareholders at the time the dividend or","page_number":77,"box":{"x":117,"y":161,"width":694,"height":13}},{"id":"5a662d31-ed1c-4ce7-88e5-9c5c72cb78de","block_type":"box","text":"distribution is made. However, any dividend or capital gain distribution declared by the Fund in","page_number":77,"box":{"x":116,"y":177,"width":705,"height":12}},{"id":"846d673f-dfca-4192-a76d-3f17a2c8c6df","block_type":"box","text":"October, November or December of any calendar year and payable to shareholders of record on a","page_number":77,"box":{"x":116,"y":192,"width":736,"height":13}},{"id":"4074d431-4039-49dc-872b-a6ff006927c6","block_type":"box","text":"specified date in such a month shall be deemed to have been received by each shareholder on","page_number":77,"box":{"x":116,"y":208,"width":711,"height":12}},{"id":"3716b687-e83e-442e-99ee-43dd9fb740e5","block_type":"box","text":"December 31 of such calendar year and to have been paid by the Fund not later than such","page_number":77,"box":{"x":117,"y":223,"width":678,"height":13}},{"id":"a8cc3be1-8800-40d2-aac1-7c9cc9fd2700","block_type":"box","text":"December 31, provided such dividend is actually paid by the Fund during January of the following","page_number":77,"box":{"x":117,"y":239,"width":727,"height":12}},{"id":"97c01ceb-eda3-4510-be8a-1219c827412c","block_type":"box","text":"calendar year.","page_number":77,"box":{"x":116,"y":255,"width":111,"height":12}},{"id":"cc51f41b-5030-47a2-a141-a6dbc9bb361a","block_type":"box","text":"The Fund intends to distribute annually to its shareholders substantially all of its net tax-exempt","page_number":77,"box":{"x":116,"y":282,"width":712,"height":12}},{"id":"eabe6c5b-7231-442b-a840-6b7861afc475","block_type":"box","text":"income, investment company taxable income and any net realized long-term capital gains in excess of","page_number":77,"box":{"x":117,"y":298,"width":763,"height":12}},{"id":"0c51f08a-3d57-4b0b-8ffa-35d058533ee5","block_type":"box","text":"net realized short-term capital losses (including any capital loss carryovers). However, if the Fund","page_number":77,"box":{"x":117,"y":313,"width":728,"height":12}},{"id":"13db1ee3-4a30-4713-a5ea-ea9330c283ae","block_type":"box","text":"retains for investment an amount equal to all or a portion of its net long-term capital gains in excess of","page_number":77,"box":{"x":117,"y":329,"width":761,"height":12}},{"id":"87ee1ffe-0f9b-4ce0-8043-010f3488953c","block_type":"box","text":"its net short-term capital losses (including any capital loss carryovers), it will be subject to a corporate","page_number":77,"box":{"x":117,"y":344,"width":757,"height":12}},{"id":"56f68ff6-d1d6-4c32-8a93-1405ff8c83d2","block_type":"box","text":"tax (at a flat rate of 21%) on the amount retained. In that event, unless the retained amount is deemed","page_number":77,"box":{"x":116,"y":360,"width":764,"height":12}},{"id":"51f28539-3964-4e9a-a295-a3317aec850d","block_type":"box","text":"to be de minimis or the applicable tax is otherwise reimbursed by BFA or an affiliate, the Fund will","page_number":77,"box":{"x":116,"y":375,"width":729,"height":12}},{"id":"ce956652-412a-4e4e-913a-047efb13b5b2","block_type":"box","text":"generally report such retained amounts as undistributed capital gains in a notice to its shareholders","page_number":77,"box":{"x":116,"y":391,"width":742,"height":12}},{"id":"58fb7b06-cafe-4876-acbf-52a41ecaf893","block_type":"box","text":"who (a) will be required to include in income for U.S. federal income tax purposes, as long-term capital","page_number":77,"box":{"x":116,"y":406,"width":766,"height":12}},{"id":"ae250935-6ca0-4396-ad50-7342b3d34c7d","block_type":"box","text":"gains, their proportionate shares of the undistributed amount, (b) will be entitled to credit their","page_number":77,"box":{"x":116,"y":422,"width":697,"height":12}},{"id":"442dbcf2-9fc9-47d1-a8a0-f1c4343b947d","block_type":"box","text":"proportionate shares of the tax paid by the Fund on the undistributed amount against their U.S. federal","page_number":77,"box":{"x":117,"y":437,"width":765,"height":12}},{"id":"1cb58dfc-f11a-40bc-8348-f13121dfcb08","block_type":"box","text":"income tax liabilities, if any, and to claim refunds to the extent their credits exceed their liabilities, if","page_number":77,"box":{"x":117,"y":453,"width":735,"height":12}},{"id":"49e924a9-3258-4c0b-9dfa-a375411cf9a7","block_type":"box","text":"any, and (c) will be entitled to increase their tax basis, for U.S. federal income tax purposes, in their","page_number":77,"box":{"x":116,"y":468,"width":742,"height":12}},{"id":"8c8a850a-e42c-408f-8573-1dd0594d3bee","block_type":"box","text":"shares by an amount equal to the excess of the amount in clause (a) over the amount in clause (b).","page_number":77,"box":{"x":116,"y":484,"width":743,"height":12}},{"id":"63bf414f-9bc1-40b7-87ae-6b3ae39b98e1","block_type":"box","text":"Organizations or persons not subject to U.S. federal income tax on such capital gains will be entitled to","page_number":77,"box":{"x":116,"y":499,"width":768,"height":13}},{"id":"b44e9ca2-9639-469d-86ed-5560e41d73b4","block_type":"box","text":"a refund of their pro rata share of such taxes paid by the Fund upon filing appropriate returns or claims","page_number":77,"box":{"x":116,"y":515,"width":766,"height":12}},{"id":"4c788532-7662-4073-ac59-daab61cdcc0a","block_type":"box","text":"for refund with the IRS.","page_number":77,"box":{"x":116,"y":530,"width":177,"height":10}},{"id":"36793e88-43eb-424f-9110-c4b3b6a0cb43","block_type":"box","text":"Distributions of net realized long-term capital gains, if any, that the Fund reports as capital gain","page_number":77,"box":{"x":117,"y":558,"width":708,"height":12}},{"id":"16aeb385-52e5-49d5-831e-cb054b743abd","block_type":"box","text":"dividends are taxable as long- term capital gains, whether paid in cash or in shares and regardless of","page_number":77,"box":{"x":116,"y":574,"width":756,"height":12}},{"id":"8878fe29-803a-43cf-8e80-56ddc9556ca1","block_type":"box","text":"how long a shareholder has held shares of the Fund. All other dividends of the Fund (including","page_number":77,"box":{"x":117,"y":589,"width":705,"height":12}},{"id":"7a7b3bbd-59c4-4d98-977f-092f7fc2c040","block_type":"box","text":"dividends from short-term capital gains) from its current and accumulated earnings and profits (“regular","page_number":77,"box":{"x":116,"y":605,"width":770,"height":12}},{"id":"56fe883a-f9d9-4602-9fba-6c050ec9bba0","block_type":"box","text":"dividends”) are generally subject to tax as ordinary income. Long-term capital gains are eligible for","page_number":77,"box":{"x":116,"y":620,"width":734,"height":12}},{"id":"9c838434-e966-481a-aeb7-f74dc3183953","block_type":"box","text":"taxation at a maximum rate of 15% or 20% for non-corporate shareholders, depending on whether their","page_number":77,"box":{"x":116,"y":636,"width":772,"height":12}},{"id":"5a427644-6efd-424f-a4e8-2010e6f86310","block_type":"box","text":"income exceeds certain threshold amounts.","page_number":77,"box":{"x":117,"y":651,"width":328,"height":10}},{"id":"283cf347-8592-4d24-8cb3-cf1f91d0dfc2","block_type":"box","text":"If an individual receives a regular dividend qualifying for the long-term capital gain rates and such","page_number":77,"box":{"x":117,"y":679,"width":720,"height":12}},{"id":"47a0b91d-60b0-440e-9d35-73806619a6f2","block_type":"box","text":"dividend constitutes an “extraordinary dividend,” and the individual subsequently recognizes a loss on","page_number":77,"box":{"x":116,"y":695,"width":753,"height":12}},{"id":"247f4a6d-7c83-4c70-a759-39ad77a6487a","block_type":"box","text":"the sale or exchange of stock in respect of which the extraordinary dividend was paid, then the loss will","page_number":77,"box":{"x":116,"y":710,"width":764,"height":12}},{"id":"f677e416-0dde-4edc-83e5-0b6eabb80fa8","block_type":"box","text":"be long-term capital loss to the extent of such extraordinary dividend. An “extraordinary dividend” on","page_number":77,"box":{"x":117,"y":726,"width":742,"height":12}},{"id":"e54f12a0-aca5-49ce-a875-bd667c6e265e","block_type":"box","text":"common stock for this purpose is generally a dividend (i) in an amount greater than or equal to 10% of","page_number":77,"box":{"x":116,"y":741,"width":759,"height":12}},{"id":"b3f5055a-084e-4afc-b766-353c1d26c503","block_type":"box","text":"the taxpayer’s tax basis (or trading value) in a share of stock, aggregating dividends with ex-dividend","page_number":77,"box":{"x":116,"y":757,"width":747,"height":12}},{"id":"799d9cda-1559-4acf-9073-1a50cd2613e4","block_type":"box","text":"dates within an 85-day period, or (ii) in an amount greater than 20% of the taxpayer’s tax basis (or","page_number":77,"box":{"x":116,"y":772,"width":728,"height":12}},{"id":"9317c9fa-60a5-4ad8-9b79-204eb7d3fbb5","block_type":"box","text":"trading value) in a share of stock, aggregating dividends with ex-dividend dates within a 365-day","page_number":77,"box":{"x":116,"y":788,"width":715,"height":12}},{"id":"1ebed0d0-995b-4881-9a9d-55108fd4815d","block_type":"box","text":"period.","page_number":77,"box":{"x":117,"y":803,"width":49,"height":12}},{"id":"c2585fe3-b09d-4ae9-822a-e5a22cbe423f","block_type":"box","text":"Distributions in excess of the Fund’s current and accumulated earnings and profits will, as to each","page_number":77,"box":{"x":117,"y":831,"width":730,"height":12}},{"id":"4aab5db3-afa4-4821-8f7b-cc09fd57bf93","block_type":"box","text":"shareholder, be treated as a tax-free return of capital to the extent of a shareholder’s basis in shares of","page_number":77,"box":{"x":116,"y":847,"width":769,"height":12}},{"id":"a790d0a4-0695-445c-a7a6-77f5ac12ea64","block_type":"box","text":"the Fund, and as a capital gain thereafter (if the shareholder holds shares of the Fund as capital","page_number":77,"box":{"x":116,"y":862,"width":718,"height":12}},{"id":"ce520fd1-4a04-4b72-a131-5764d6555e0a","block_type":"box","text":"assets). Distributions in excess of the Fund’s minimum distribution requirements, but not in excess of","page_number":77,"box":{"x":116,"y":878,"width":754,"height":12}},{"id":"785a8ad1-4203-4f67-916b-972a449afa3a","block_type":"box","text":"72","page_number":77,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"b682d17b-c9a9-4f8a-9744-0f4e157a7eb3","block_type":"box","text":"NM0926U-5926888-77/257","page_number":77,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"04621133-913f-4548-861b-06b3928ddb53","block_type":"box","text":"the Fund’s earnings and profits, will be taxable to shareholders and will not constitute nontaxable","page_number":78,"box":{"x":116,"y":87,"width":724,"height":12}},{"id":"cb1e7a10-a9d5-4c00-8c1f-6bfdaeb98b6f","block_type":"box","text":"returns of capital. Shareholders receiving dividends or distributions in the form of additional shares","page_number":78,"box":{"x":117,"y":102,"width":734,"height":13}},{"id":"20ce55be-5c5d-49db-8e21-b1abf3c0e9bd","block_type":"box","text":"should be treated for U.S. federal income tax purposes as receiving a distribution in an amount equal","page_number":78,"box":{"x":116,"y":118,"width":755,"height":12}},{"id":"06aac533-2304-4bd2-958f-099693650aed","block_type":"box","text":"to the amount of money that the shareholders receiving cash dividends or distributions will receive and","page_number":78,"box":{"x":116,"y":134,"width":766,"height":12}},{"id":"6b7d5bf6-ac49-4b04-8b32-f8e846bbb667","block_type":"box","text":"should have a cost basis in the shares received equal to such amount. No deduction would be allowed","page_number":78,"box":{"x":116,"y":149,"width":766,"height":12}},{"id":"caa7472d-cd4d-45f5-9611-70ea18fd6ba4","block_type":"box","text":"to an investor for interest on indebtedness incurred or continued to purchase or carry shares of the","page_number":78,"box":{"x":116,"y":165,"width":737,"height":12}},{"id":"6faab145-8ff9-4486-866e-02269d09fdf2","block_type":"box","text":"Fund to the extent the interest deduction would relate to exempt-interest dividends received.","page_number":78,"box":{"x":117,"y":180,"width":688,"height":12}},{"id":"477ed9eb-16fb-438c-88c0-3bded99e1b55","block_type":"box","text":"A 3.8% U.S. federal Medicare contribution tax is imposed on net investment income, including, but not","page_number":78,"box":{"x":116,"y":211,"width":763,"height":12}},{"id":"6a688ed5-2ef8-40f8-95c6-249f55461246","block_type":"box","text":"limited to, interest, dividends, and net gain from investments, of U.S. individuals with income exceeding","page_number":78,"box":{"x":117,"y":227,"width":770,"height":12}},{"id":"d50c55bd-a04a-40f3-ac3a-c035f0d8acc3","block_type":"box","text":"$200,000 (or $250,000 if married and filing jointly), and of estates and trusts.","page_number":78,"box":{"x":116,"y":241,"width":573,"height":13}},{"id":"7fb94ab8-8dbe-4319-9c07-67aced18060e","block_type":"box","text":"Investors considering buying shares just prior to a dividend or capital gain distribution should be aware","page_number":78,"box":{"x":117,"y":273,"width":765,"height":12}},{"id":"28015ad0-0cff-4f19-b91e-8e595445e917","block_type":"box","text":"that, although the price of shares purchased at that time may reflect the amount of the forthcoming","page_number":78,"box":{"x":116,"y":289,"width":737,"height":12}},{"id":"cc19e2ca-ccd9-49d0-afb0-9bd5881865ed","block_type":"box","text":"distribution, such dividend or distribution may nevertheless be taxable to them. If the Fund is the holder","page_number":78,"box":{"x":116,"y":304,"width":770,"height":12}},{"id":"2401f39a-3fe3-4e24-8aaa-85bdc595b7c5","block_type":"box","text":"of record of any security on the record date for any dividends payable with respect to such security,","page_number":78,"box":{"x":116,"y":320,"width":742,"height":12}},{"id":"f66fb77e-b2de-430f-ae8b-1ed735827c0d","block_type":"box","text":"such dividends will be included in the Fund’s gross income not as of the date received but as of the","page_number":78,"box":{"x":116,"y":335,"width":741,"height":12}},{"id":"1c5cf3ff-f4df-492b-ad8e-c8628483f993","block_type":"box","text":"later of (i) the date such security became ex-dividend with respect to such dividends (i.e., the date on","page_number":78,"box":{"x":117,"y":351,"width":754,"height":12}},{"id":"63a6c159-f9ec-43b2-be9d-732df8d96d9a","block_type":"box","text":"which a buyer of the security would not be entitled to receive the declared, but unpaid, dividends); or","page_number":78,"box":{"x":116,"y":366,"width":750,"height":12}},{"id":"88b796af-f446-4ce8-93ca-99e05da3f4b2","block_type":"box","text":"(ii) the date the Fund acquired such security. Accordingly, in order to satisfy its income distribution","page_number":78,"box":{"x":117,"y":382,"width":731,"height":12}},{"id":"099cb5ed-593d-47f6-8324-d0e384ffb7e0","block_type":"box","text":"requirements, the Fund may be required to pay dividends based on anticipated earnings, and","page_number":78,"box":{"x":117,"y":397,"width":697,"height":12}},{"id":"de988c6a-fbc0-4fc5-befb-aa1e94da3f35","block_type":"box","text":"shareholders may receive dividends in an earlier year than would otherwise be the case.","page_number":78,"box":{"x":116,"y":413,"width":662,"height":12}},{"id":"5d086a68-d496-48b4-951d-927bc395a30a","block_type":"box","text":"In certain situations, the Fund may, for a taxable year, defer all or a portion of its net capital loss (or if","page_number":78,"box":{"x":117,"y":444,"width":754,"height":12}},{"id":"6e170111-ec61-4e6d-895f-c7c5c3ec2bfe","block_type":"box","text":"there is no net capital loss, then any net long-term or short-term capital loss) realized after October and","page_number":78,"box":{"x":116,"y":459,"width":771,"height":12}},{"id":"88f230f9-0bfe-48d0-b52e-080091900a1b","block_type":"box","text":"its late-year ordinary loss (defined as the sum of the excess of post-October foreign currency and","page_number":78,"box":{"x":117,"y":475,"width":726,"height":12}},{"id":"b7384307-83ef-41f8-957e-202d71d2553c","block_type":"box","text":"passive foreign investment company (“PFIC”) losses over post- October foreign currency and PFIC","page_number":78,"box":{"x":117,"y":490,"width":739,"height":12}},{"id":"4f2b142d-81d3-4725-b482-280370dc2ad2","block_type":"box","text":"gains, plus the excess of post-December ordinary losses over post-December ordinary income) until","page_number":78,"box":{"x":116,"y":506,"width":749,"height":12}},{"id":"57c485dd-59ed-45d2-8532-b38487c07771","block_type":"box","text":"the next taxable year in computing its investment company taxable income and net capital gain, which","page_number":78,"box":{"x":116,"y":521,"width":762,"height":12}},{"id":"62a7fdb7-61f6-4c93-8a23-ab8de98798fc","block_type":"box","text":"will defer the recognition of such realized losses. Such deferrals and other rules regarding gains and","page_number":78,"box":{"x":116,"y":537,"width":749,"height":12}},{"id":"e2e9f583-48dd-4784-8809-c422ead6d005","block_type":"box","text":"losses realized after October (or December) may affect the tax character of shareholder distributions.","page_number":78,"box":{"x":117,"y":552,"width":755,"height":12}},{"id":"4b1e0283-4696-441a-97d5-bff0dd8a9298","block_type":"box","text":"Sales of Shares.","page_number":78,"box":{"x":116,"y":583,"width":129,"height":10}},{"id":"c1c9fcf5-0fcf-4ead-87a0-62220e8bb911","block_type":"box","text":"Upon the sale or exchange of shares of the Fund, a shareholder will realize a taxable","page_number":78,"box":{"x":246,"y":583,"width":642,"height":12}},{"id":"c7034111-bd87-4b07-b44b-c7d5381bbc1d","block_type":"box","text":"gain or loss equal to the difference between the amount realized and the shareholder’s basis in shares","page_number":78,"box":{"x":116,"y":599,"width":766,"height":12}},{"id":"ef75e7a0-204a-4baf-8cdb-4c0b04464ab3","block_type":"box","text":"of the Fund. A redemption of shares by the Fund will be treated as a sale for this purpose. Such gain or","page_number":78,"box":{"x":116,"y":614,"width":772,"height":12}},{"id":"49bdcfde-861c-418f-a9a1-6b8da014c06b","block_type":"box","text":"loss will be treated as capital gain or loss if the shares are capital assets in the shareholder’s hands","page_number":78,"box":{"x":117,"y":630,"width":742,"height":12}},{"id":"a2c11f10-47c4-4f7a-aa2c-22a0255e9474","block_type":"box","text":"and will be long-term capital gain or loss if the shares","page_number":78,"box":{"x":116,"y":645,"width":400,"height":12}},{"id":"eff5ab94-bd59-4260-972e-573745192296","block_type":"box","text":"are held for more than one year and short- term","page_number":78,"box":{"x":517,"y":645,"width":359,"height":12}},{"id":"1247df1c-5a64-4196-8528-cadfe4f48a2c","block_type":"box","text":"capital gain or loss if the shares are held for one year or less. Any loss realized on a sale or exchange","page_number":78,"box":{"x":116,"y":661,"width":756,"height":12}},{"id":"484b57ec-1524-461b-9dc4-192f2d0aef8a","block_type":"box","text":"will be disallowed to the extent the shares disposed of are replaced, including replacement through the","page_number":78,"box":{"x":116,"y":676,"width":762,"height":12}},{"id":"56c42f28-8315-43af-b6cb-78b3fcd60102","block_type":"box","text":"reinvesting of dividends or capital gains distributions, or by an option, or contract to acquire","page_number":78,"box":{"x":117,"y":692,"width":675,"height":12}},{"id":"c95a80e1-5fc2-4ba0-be99-aa0202c22ab4","block_type":"box","text":"substantially identical shares, within a 61-day period beginning 30 days before and ending 30 days","page_number":78,"box":{"x":116,"y":707,"width":732,"height":12}},{"id":"608f71a9-ee5d-482e-bc74-56b4ff21c817","block_type":"box","text":"after the disposition of the shares. In such a case, the basis of the shares acquired will be increased to","page_number":78,"box":{"x":116,"y":723,"width":761,"height":12}},{"id":"d197de3e-cbdb-441f-8123-5b7e12868757","block_type":"box","text":"reflect the disallowed loss. Any loss realized by a shareholder on the sale of Fund shares held by the","page_number":78,"box":{"x":117,"y":738,"width":747,"height":12}},{"id":"a34d0917-48c5-4f8b-85d8-27f7eb2f5a76","block_type":"box","text":"shareholder for six months or less will be treated for U.S. federal income tax purposes as a long-term","page_number":78,"box":{"x":116,"y":754,"width":750,"height":12}},{"id":"efac4194-90b1-48ab-8d8d-b5933f8a535b","block_type":"box","text":"capital loss to the extent of any distributions or deemed distributions of long-term capital gains received","page_number":78,"box":{"x":116,"y":769,"width":765,"height":12}},{"id":"1dcb5a10-8965-4c2b-97f8-930f2a2f9d48","block_type":"box","text":"by the shareholder with respect to such share. The Medicare contribution tax described above will","page_number":78,"box":{"x":117,"y":785,"width":725,"height":12}},{"id":"13d1f73a-73a8-4edb-8c32-aafbdb0343d3","block_type":"box","text":"apply to the sale of Fund shares.","page_number":78,"box":{"x":116,"y":800,"width":242,"height":12}},{"id":"f5d045c1-0611-4a39-b98c-099de799df5d","block_type":"box","text":"If a shareholder incurs a sales charge in acquiring shares of the Fund, disposes of those shares within","page_number":78,"box":{"x":117,"y":831,"width":763,"height":12}},{"id":"4207af7f-da24-4f07-ad19-c54afd2903e2","block_type":"box","text":"90 days and then, on or before January 31 of the following calendar year, acquires shares in a mutual","page_number":78,"box":{"x":116,"y":847,"width":761,"height":12}},{"id":"438c7042-a6b0-4616-bd5d-2ecd3ff74d75","block_type":"box","text":"fund for which the otherwise applicable sales charge is reduced by reason of a reinvestment right (e.g.,","page_number":78,"box":{"x":116,"y":862,"width":770,"height":12}},{"id":"5cf37719-4b59-4ffa-8a96-7b249a8bc2af","block_type":"box","text":"an exchange privilege), the original sales charge will not be taken into account in computing gain/loss","page_number":78,"box":{"x":116,"y":878,"width":757,"height":12}},{"id":"5b5378e8-5fef-4c36-9f71-b75d5c2ea086","block_type":"box","text":"73","page_number":78,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"a80e82c0-bf43-4fe3-ad13-c18b3e42672e","block_type":"box","text":"NM0926U-5926888-78/257","page_number":78,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"18af4461-8fba-48a2-8fc1-9f14fa6f4209","block_type":"box","text":"on the original shares to the extent the subsequent sales charge is reduced. Instead, the disregarded","page_number":79,"box":{"x":116,"y":87,"width":756,"height":12}},{"id":"917b9f06-4833-4919-a716-5c9381e54713","block_type":"box","text":"portion of the original sales charge will be added to the tax basis of the newly acquired shares.","page_number":79,"box":{"x":117,"y":102,"width":705,"height":13}},{"id":"8b92efdc-deb0-4b71-ab8f-abcb32c4c389","block_type":"box","text":"Furthermore, the same rule also applies to a disposition of the newly acquired shares made within 90","page_number":79,"box":{"x":117,"y":118,"width":755,"height":12}},{"id":"7741849a-7906-464c-967d-7c0411dfd390","block_type":"box","text":"days of the second acquisition. This provision prevents a shareholder from immediately deducting the","page_number":79,"box":{"x":116,"y":134,"width":758,"height":12}},{"id":"c0a7446e-c90b-4c51-9d10-cafa7456721b","block_type":"box","text":"sales charge by shifting his or her investment within a family of mutual funds.","page_number":79,"box":{"x":116,"y":149,"width":576,"height":12}},{"id":"a2ac24c6-b93e-43dc-b7af-175a1d9aa94f","block_type":"box","text":"Backup Withholding.","page_number":79,"box":{"x":117,"y":176,"width":165,"height":12}},{"id":"4bd6d086-6d2d-4237-b166-a08a6acc6573","block_type":"box","text":"In certain cases, the Fund will be required to withhold at a 24% rate and remit to","page_number":79,"box":{"x":283,"y":176,"width":605,"height":12}},{"id":"e071da58-f0e7-4405-b19f-ab5243278f6e","block_type":"box","text":"the U.S. Treasury such amounts withheld from any distributions paid to a shareholder who: (i) has","page_number":79,"box":{"x":116,"y":192,"width":731,"height":12}},{"id":"3346b636-64e4-4089-ab71-490155c88540","block_type":"box","text":"failed to provide a correct taxpayer identification number; (ii) is subject to backup withholding by the","page_number":79,"box":{"x":116,"y":207,"width":743,"height":12}},{"id":"17aa2746-f971-4114-b917-3e1413b0ef9c","block_type":"box","text":"IRS; (iii) has failed to certify to the Fund that such shareholder is not subject to backup withholding; or","page_number":79,"box":{"x":117,"y":223,"width":759,"height":12}},{"id":"4195e22a-6074-4a83-8e53-d9d7863d5977","block_type":"box","text":"(iv) has not certified that such shareholder is a U.S. person (including a U.S. resident alien). Backup","page_number":79,"box":{"x":117,"y":238,"width":745,"height":12}},{"id":"e4268c2d-02b3-4981-ac74-c7d869ba1cdb","block_type":"box","text":"withholding is not an additional tax and any amount withheld may be credited against a shareholder’s","page_number":79,"box":{"x":116,"y":254,"width":755,"height":12}},{"id":"7975a94e-21f3-4efd-a4f7-917d2159e1d9","block_type":"box","text":"U.S. federal income tax liability.","page_number":79,"box":{"x":117,"y":269,"width":238,"height":12}},{"id":"c2834a9e-fdf0-4038-8d9d-8c795bdfd212","block_type":"box","text":"Sections 351 and 362.","page_number":79,"box":{"x":116,"y":296,"width":173,"height":10}},{"id":"047c7db6-47e3-46dd-8942-b3995d434cbf","block_type":"box","text":"The Trust, on behalf of the Fund, has the right to reject an order for a purchase","page_number":79,"box":{"x":291,"y":296,"width":596,"height":12}},{"id":"89bb96ff-20b0-4c8e-904f-baf96199b3ec","block_type":"box","text":"of shares of the Fund if the purchaser (or group of purchasers) would, upon obtaining the shares so","page_number":79,"box":{"x":116,"y":312,"width":744,"height":12}},{"id":"40a0e22d-a645-4641-b0bf-cb8780239f47","block_type":"box","text":"ordered, own 80% or more of the outstanding shares of a given Fund and if, pursuant to Sections 351","page_number":79,"box":{"x":116,"y":327,"width":760,"height":12}},{"id":"ed486ec2-c725-439e-9836-76485dd487f3","block_type":"box","text":"and 362 of the Internal Revenue Code, that Fund would have a basis in the securities different from the","page_number":79,"box":{"x":116,"y":343,"width":772,"height":11}},{"id":"4bfb568d-4d44-4152-926e-c13b0cec9e2d","block_type":"box","text":"market value of such securities on the date of deposit. If the Fund’s basis in such securities on the date","page_number":79,"box":{"x":117,"y":358,"width":770,"height":12}},{"id":"acd22f39-c8fb-4ad5-8f8e-5cff8652510a","block_type":"box","text":"of deposit was less than market value on such date, the Fund, upon disposition of the securities, would","page_number":79,"box":{"x":116,"y":374,"width":769,"height":12}},{"id":"b3c1e120-5699-4a4e-8384-5d3dd311533b","block_type":"box","text":"recognize more taxable gain or less taxable loss than if its basis in the securities had been equal to","page_number":79,"box":{"x":117,"y":389,"width":740,"height":12}},{"id":"13ec2c0a-2e8b-45f2-8267-26909fb76eb6","block_type":"box","text":"market value. It is not anticipated that the Trust will exercise the right of rejection except in a case","page_number":79,"box":{"x":117,"y":405,"width":728,"height":12}},{"id":"dc40b74c-81ea-4920-8226-da974e9caee2","block_type":"box","text":"where the Trust determines that accepting the order could result in material adverse tax consequences","page_number":79,"box":{"x":116,"y":420,"width":769,"height":12}},{"id":"acc17bbd-6324-4498-9450-d7ba29a0ce6b","block_type":"box","text":"to the Fund or its shareholders. The Trust also has the right to require information necessary to","page_number":79,"box":{"x":116,"y":436,"width":711,"height":12}},{"id":"8f7d5057-ca5d-470d-961c-80728851be8c","block_type":"box","text":"determine beneficial share ownership for purposes of the 80% determination.","page_number":79,"box":{"x":116,"y":451,"width":578,"height":12}},{"id":"d799d381-f84d-41d3-bad0-ecece9c34bc4","block_type":"box","text":"Taxation of Certain Derivatives.","page_number":79,"box":{"x":116,"y":478,"width":250,"height":10}},{"id":"4a0e1333-a425-46ba-a992-fa89a871c989","block_type":"box","text":"The Fund’s transactions in zero coupon securities, non-U.S.","page_number":79,"box":{"x":367,"y":478,"width":456,"height":12}},{"id":"926ea56a-b116-4981-a596-6da18ef5a556","block_type":"box","text":"currencies, forward contracts, options and futures contracts (including options and futures contracts on","page_number":79,"box":{"x":116,"y":494,"width":767,"height":12}},{"id":"df884887-352a-462e-975c-a1e803efd931","block_type":"box","text":"non-U.S. currencies), to the extent permitted, will be subject to special provisions of the Internal","page_number":79,"box":{"x":117,"y":509,"width":713,"height":13}},{"id":"bc64fdc8-01b8-4a6c-b9a2-8bef90f7c576","block_type":"box","text":"Revenue Code (including provisions relating to “hedging transactions” and “straddles”) that, among","page_number":79,"box":{"x":117,"y":525,"width":739,"height":12}},{"id":"ea1a7b0a-86b8-413a-9fe7-12bd82229e02","block_type":"box","text":"other consequences, may affect the character of gains and losses realized by the Fund (i.e., may affect","page_number":79,"box":{"x":116,"y":540,"width":772,"height":13}},{"id":"2371855a-2d15-4eb4-8228-0f5216fc264b","block_type":"box","text":"whether gains or losses are ordinary or capital), accelerate recognition of income to the Fund and defer","page_number":79,"box":{"x":116,"y":556,"width":772,"height":12}},{"id":"80f7cd13-1cdb-4f60-bff1-4a7390992158","block_type":"box","text":"Fund losses. These rules could therefore affect the character, amount and timing of distributions to","page_number":79,"box":{"x":117,"y":571,"width":737,"height":13}},{"id":"6c496d4f-646a-4baf-8cad-002137f331a4","block_type":"box","text":"shareholders. These provisions also (a) will require the Fund to mark-to-market certain types of the","page_number":79,"box":{"x":116,"y":587,"width":740,"height":12}},{"id":"7dd54a84-72d4-4d7f-9cc9-760a278b18e0","block_type":"box","text":"positions in its portfolio (i.e., treat them as if they were","page_number":79,"box":{"x":117,"y":602,"width":405,"height":13}},{"id":"54853e21-575f-470b-b023-d19af110ea19","block_type":"box","text":"closed out at the end of each year) and (b) may","page_number":79,"box":{"x":523,"y":602,"width":358,"height":13}},{"id":"71c0d8d8-435d-4fab-af42-537ce47f8825","block_type":"box","text":"cause the Fund to recognize income without receiving cash with which to pay dividends or make","page_number":79,"box":{"x":116,"y":618,"width":720,"height":12}},{"id":"1581e0c9-b619-4b94-8662-6b05e84b2d3d","block_type":"box","text":"distributions in amounts necessary to satisfy the distribution requirements for avoiding income and","page_number":79,"box":{"x":116,"y":634,"width":734,"height":12}},{"id":"7be92c64-bc87-440e-aa81-44a80d18f429","block_type":"box","text":"excise taxes. The Fund will monitor its transactions, will make the appropriate tax elections and will","page_number":79,"box":{"x":116,"y":649,"width":740,"height":12}},{"id":"7a9c7b8d-ce5a-4694-b9e5-80df5103f9a5","block_type":"box","text":"make the appropriate entries in its books and records when it acquires any zero coupon security,","page_number":79,"box":{"x":117,"y":665,"width":717,"height":12}},{"id":"9f1a7031-caa9-4ec8-8a58-14dcecc35762","block_type":"box","text":"non-U.S. currency, forward contract, option, futures contract or hedged investment in order to mitigate","page_number":79,"box":{"x":117,"y":680,"width":756,"height":12}},{"id":"f92c5121-2cee-419a-bcb0-d48a8b05a45f","block_type":"box","text":"the effect of these rules and prevent disqualification of the Fund as a RIC.","page_number":79,"box":{"x":116,"y":696,"width":547,"height":11}},{"id":"4eb62709-9e73-42b2-b1b2-f0344b191ef3","block_type":"box","text":"The Fund’s investments in so-called “section 1256 contracts,” such as regulated futures contracts,","page_number":79,"box":{"x":116,"y":723,"width":727,"height":12}},{"id":"da99306e-d690-436e-a78d-23747f5b4d26","block_type":"box","text":"most non-U.S. currency forward contracts traded in the interbank market and options on most security","page_number":79,"box":{"x":117,"y":738,"width":757,"height":12}},{"id":"397a7923-ff56-4921-83fc-c5c248963c6a","block_type":"box","text":"indexes, are subject to special tax rules. All section 1256 contracts held by the Fund at the end of its","page_number":79,"box":{"x":117,"y":754,"width":743,"height":12}},{"id":"241fc1f8-a040-4727-a23c-4eb609fc171a","block_type":"box","text":"taxable year are required to be marked to their market value, and any unrealized gain or loss on those","page_number":79,"box":{"x":116,"y":769,"width":758,"height":12}},{"id":"28b817f9-433f-4bd0-bcbd-f01cfba88e7c","block_type":"box","text":"positions will be included in the Fund’s income as if each position had been sold for its fair market","page_number":79,"box":{"x":117,"y":785,"width":723,"height":12}},{"id":"5b54720d-ea3e-4c67-9ba4-e36d310192b9","block_type":"box","text":"value at the end of the taxable year. The resulting gain","page_number":79,"box":{"x":116,"y":800,"width":405,"height":12}},{"id":"f6ff0bcd-755d-4204-9172-a30ace6e5623","block_type":"box","text":"or loss will be combined with any gain or loss","page_number":79,"box":{"x":527,"y":800,"width":335,"height":12}},{"id":"4be7d3db-4676-4662-8bc3-10e62e60a027","block_type":"box","text":"realized by the Fund from positions in section 1256 contracts closed during the taxable year. Provided","page_number":79,"box":{"x":117,"y":816,"width":755,"height":12}},{"id":"9a5129d5-c631-40d4-87fa-a88e37dd8b0c","block_type":"box","text":"such positions were held as capital assets and were not","page_number":79,"box":{"x":116,"y":831,"width":420,"height":12}},{"id":"6f3bf88a-68b2-4d21-9da5-a921ee826fc6","block_type":"box","text":"part of a “hedging transaction” nor part of a","page_number":79,"box":{"x":537,"y":831,"width":324,"height":12}},{"id":"56dc0211-a327-4751-9f86-f162d0d9c3a7","block_type":"box","text":"“straddle,” 60% of the resulting net gain or loss will be treated as long-term capital gain or loss, and","page_number":79,"box":{"x":116,"y":847,"width":741,"height":12}},{"id":"3d0de76a-bb42-4d9a-a9d8-535ef63c62ba","block_type":"box","text":"40% of such net gain or loss will be treated as short-term capital gain or loss, regardless of the period","page_number":79,"box":{"x":116,"y":862,"width":759,"height":12}},{"id":"427c6b8c-4262-4ff1-8298-6d6b05d56db4","block_type":"box","text":"of time the positions were actually held by the Fund.","page_number":79,"box":{"x":116,"y":878,"width":392,"height":12}},{"id":"8ad730b0-7168-4f16-b638-0814ffd37371","block_type":"box","text":"74","page_number":79,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"ac232f3b-0acf-44b0-895f-e4fbe698db45","block_type":"box","text":"NM0926U-5926888-79/257","page_number":79,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"b2b20db8-30b7-40e9-851e-d112cf08099d","block_type":"box","text":"As a result of entering into swap contracts, the Fund may make or receive periodic net payments. The","page_number":80,"box":{"x":116,"y":87,"width":762,"height":12}},{"id":"fb25f5bb-0700-42c5-8438-b3be9913b25e","block_type":"box","text":"Fund may also make or receive a payment when a swap is terminated prior to maturity through an","page_number":80,"box":{"x":117,"y":103,"width":732,"height":12}},{"id":"832aad39-c4d1-4e2d-8fef-0e1927678800","block_type":"box","text":"assignment of the swap or other closing transaction. Periodic net payments will generally constitute","page_number":80,"box":{"x":116,"y":118,"width":742,"height":12}},{"id":"65205e39-033d-4736-b68e-68b7c89a9fbe","block_type":"box","text":"ordinary income or deductions, while termination of a swap will generally result in capital gain or loss","page_number":80,"box":{"x":116,"y":134,"width":751,"height":12}},{"id":"102ced32-3473-417f-8b1f-150c28841ea9","block_type":"box","text":"(which will be a long-term capital gain or loss if the Fund has been a party to the swap for more than","page_number":80,"box":{"x":117,"y":149,"width":747,"height":12}},{"id":"5a9af2e7-1fcc-4d48-aeed-1b01040ad31d","block_type":"box","text":"one year). The cost of any payments made by the Fund on a swap transaction will be netted pro rata","page_number":80,"box":{"x":116,"y":165,"width":752,"height":12}},{"id":"a6f1c8ae-202b-4b5f-969b-79953082387c","block_type":"box","text":"against both tax exempt and taxable gross income. With respect to certain types of swaps, the Fund","page_number":80,"box":{"x":116,"y":180,"width":749,"height":12}},{"id":"12cc4c1d-d82b-4b8e-a193-91730298b87f","block_type":"box","text":"may be required to currently recognize income or loss with respect to future payments on such swaps","page_number":80,"box":{"x":117,"y":196,"width":759,"height":12}},{"id":"78eb3c31-68ad-40dd-bb27-2c4454cd3f7b","block_type":"box","text":"or may elect under certain circumstances to mark such swaps to market annually for tax purposes as","page_number":80,"box":{"x":116,"y":211,"width":755,"height":12}},{"id":"96b29edc-0383-48f5-b1dc-f6e7d586913f","block_type":"box","text":"ordinary income or loss.","page_number":80,"box":{"x":116,"y":227,"width":183,"height":12}},{"id":"b331f868-2ea6-44e0-8414-91910fd5c3e2","block_type":"box","text":"Qualified Dividend Income.","page_number":80,"box":{"x":116,"y":258,"width":215,"height":10}},{"id":"2174fb32-c65e-48c2-b658-576b7e2c5315","block_type":"box","text":"Distributions by the Fund of investment company taxable income","page_number":80,"box":{"x":332,"y":258,"width":491,"height":12}},{"id":"de0462c8-3eba-4de6-be45-3b290bd12ad2","block_type":"box","text":"(including any short-term capital gains), whether received in cash or shares, will be taxable either as","page_number":80,"box":{"x":117,"y":273,"width":747,"height":12}},{"id":"155323b1-93dd-48ec-88d5-ccd3d58f9a0e","block_type":"box","text":"ordinary income or as qualified dividend income, which is eligible to be taxed at long-term capital gain","page_number":80,"box":{"x":116,"y":289,"width":758,"height":12}},{"id":"a536b8ba-84b9-487b-aadd-c52a4f84d3f4","block_type":"box","text":"rates to the extent the Fund receives qualified dividend income on the securities it holds and the Fund","page_number":80,"box":{"x":117,"y":304,"width":759,"height":12}},{"id":"ef9428c9-73ac-4ce4-a63b-2dbcecc39e2c","block_type":"box","text":"reports the distribution as qualified dividend income. Qualified dividend income is, in general, dividend","page_number":80,"box":{"x":117,"y":320,"width":760,"height":12}},{"id":"c6f568c4-0625-443b-936b-273df5f10953","block_type":"box","text":"income from taxable U.S. corporations (but generally not from U.S. REITs) and certain non-U.S.","page_number":80,"box":{"x":117,"y":335,"width":717,"height":12}},{"id":"451c8993-e406-463e-8555-eaf0b1948e6d","block_type":"box","text":"corporations (e.g., non-U.S. corporations that are not PFICs and which are incorporated in a","page_number":80,"box":{"x":116,"y":351,"width":689,"height":12}},{"id":"eeae3928-3413-45c1-abc8-15e2d71feb7b","block_type":"box","text":"possession of the U.S. or in certain countries with a comprehensive tax treaty with the U.S., or the","page_number":80,"box":{"x":117,"y":366,"width":732,"height":12}},{"id":"e44fdbb2-6112-445d-9973-5747e0920bcb","block_type":"box","text":"stock of which is readily tradable on an established securities market in the U.S. (where the dividends","page_number":80,"box":{"x":116,"y":382,"width":759,"height":12}},{"id":"bea06e7a-f05d-4ac8-a949-5ce5881e67dc","block_type":"box","text":"are paid with respect to such stock)). Substitute payments received by the Fund for securities lent out","page_number":80,"box":{"x":116,"y":397,"width":758,"height":12}},{"id":"7b9cfc3a-994c-4ecb-a34b-87353a8f2390","block_type":"box","text":"by the Fund will not be qualified dividend income.","page_number":80,"box":{"x":117,"y":413,"width":370,"height":12}},{"id":"61c18236-9bbf-4586-850b-f81a83685688","block_type":"box","text":"A dividend from the Fund will not be treated as qualified dividend income to the extent that: (i) the","page_number":80,"box":{"x":116,"y":444,"width":728,"height":12}},{"id":"64459a3a-30b7-4fb1-a3d7-371a25b7dc41","block_type":"box","text":"shareholder has not held the shares on which the dividend was paid for 61 days during the 121-day","page_number":80,"box":{"x":116,"y":459,"width":743,"height":12}},{"id":"26995f57-a11a-46d9-8e54-af2cdb9f1c29","block_type":"box","text":"period that begins on the date that is 60 days before the date on which the shares become ex-dividend","page_number":80,"box":{"x":117,"y":475,"width":767,"height":12}},{"id":"d6bbe56d-8bfc-41eb-bc9f-0625190ee101","block_type":"box","text":"with respect to such dividend or the Fund fails to satisfy those holding period requirements with respect","page_number":80,"box":{"x":116,"y":490,"width":771,"height":12}},{"id":"842543be-53fd-4749-b5cc-bf9a9cf61e38","block_type":"box","text":"to the securities it holds that paid the dividends distributed to the shareholder (or, in the case of certain","page_number":80,"box":{"x":116,"y":506,"width":766,"height":12}},{"id":"bb641c6e-c46c-4c2d-945f-ea7368579c43","block_type":"box","text":"preferred stocks, the holding requirement of 91 days during the 181-day period beginning on the date","page_number":80,"box":{"x":117,"y":521,"width":756,"height":12}},{"id":"02a75b16-cfb7-406d-98d1-999930c39a3c","block_type":"box","text":"that is 90 days before the date on which the stock becomes ex-dividend with respect to such dividend);","page_number":80,"box":{"x":116,"y":537,"width":769,"height":12}},{"id":"5d22dd87-a1ac-48b0-ad88-128b148fb20e","block_type":"box","text":"(ii) the Fund or the shareholder is under an obligation (whether pursuant to a short sale or otherwise) to","page_number":80,"box":{"x":117,"y":552,"width":771,"height":12}},{"id":"52a5e93b-f050-4eab-8252-f26d424e935c","block_type":"box","text":"make related payments with respect to substantially similar or related property; or (iii) the shareholder","page_number":80,"box":{"x":117,"y":568,"width":758,"height":12}},{"id":"feb2ba2f-8c9d-45cd-a7f6-bbdcf0acb486","block_type":"box","text":"elects to treat such dividend as investment income under Section 163(d)(4)(B) of the Internal Revenue","page_number":80,"box":{"x":116,"y":583,"width":765,"height":12}},{"id":"26dd1434-f5a3-4538-ab64-ad3868028f75","block_type":"box","text":"Code. Dividends received by the Fund from a REIT or another RIC may be treated as qualified","page_number":80,"box":{"x":117,"y":599,"width":706,"height":12}},{"id":"9c9cbce4-7e4e-4fbb-9d4a-3d755d4c3969","block_type":"box","text":"dividend income only to the extent the dividend distributions are attributable to qualified dividend","page_number":80,"box":{"x":116,"y":614,"width":719,"height":12}},{"id":"33873e21-0cb7-4bda-b16a-3423ead845f6","block_type":"box","text":"income received by such REIT or other RIC. It is expected that dividends received by the Fund from a","page_number":80,"box":{"x":117,"y":630,"width":760,"height":12}},{"id":"cac80621-090d-4869-a0b4-cbd26577e86a","block_type":"box","text":"REIT and distributed to a shareholder generally will be taxable to the shareholder as ordinary income.","page_number":80,"box":{"x":117,"y":645,"width":758,"height":12}},{"id":"c5e3171f-b75d-4211-8eb2-daccee763ce8","block_type":"box","text":"However, a non-corporate taxpayer who is a direct REIT shareholder may claim a 20% “qualified","page_number":80,"box":{"x":117,"y":661,"width":716,"height":12}},{"id":"ebe3a0e4-7f04-4f34-b17d-1c70e3cdf644","block_type":"box","text":"business income” deduction for ordinary REIT dividends, and regulations permit a RIC to report","page_number":80,"box":{"x":117,"y":676,"width":707,"height":12}},{"id":"24ec1543-22fa-409e-9fc4-8776dfdd9174","block_type":"box","text":"dividends as eligible for this deduction to the extent the RIC’s income is derived from ordinary REIT","page_number":80,"box":{"x":116,"y":692,"width":737,"height":12}},{"id":"c3149bd3-ca67-48d5-b9e3-268486634e6f","block_type":"box","text":"dividends (reduced by allocable RIC expenses). A shareholder may treat the dividends as such","page_number":80,"box":{"x":116,"y":707,"width":706,"height":12}},{"id":"a7c22b8b-a153-4ecc-b78e-ea0427dfa640","block_type":"box","text":"provided the RIC and the shareholder satisfy applicable holding period requirements, provided such","page_number":80,"box":{"x":117,"y":723,"width":738,"height":12}},{"id":"198a1e9f-913d-419f-93f6-5fdf1a475ffa","block_type":"box","text":"shareholders satisfy the applicable holding period requirement. Distributions by the Fund of its net","page_number":80,"box":{"x":116,"y":738,"width":726,"height":12}},{"id":"53df3528-98dd-4e55-9ea3-8930556eda35","block_type":"box","text":"short-term capital gains will be taxable as ordinary income.","page_number":80,"box":{"x":116,"y":754,"width":435,"height":12}},{"id":"b00f545c-7a56-46b9-8aa5-f5464924547f","block_type":"box","text":"Market Discount.","page_number":80,"box":{"x":117,"y":785,"width":133,"height":9}},{"id":"896ad130-a6da-4319-81ba-256986f3b63b","block_type":"box","text":"Any market discount recognized on a bond is taxable as ordinary income. A market","page_number":80,"box":{"x":256,"y":785,"width":618,"height":12}},{"id":"51b41cc6-f4fb-468f-a865-ae393f0406c9","block_type":"box","text":"discount bond is a bond acquired in the secondary market at a price below redemption value or","page_number":80,"box":{"x":116,"y":800,"width":707,"height":12}},{"id":"c47bb63e-a964-4057-86b4-19d57bf530a3","block_type":"box","text":"adjusted issue price if issued with original issue discount (“OID”). To the extent the Fund does not","page_number":80,"box":{"x":116,"y":816,"width":725,"height":12}},{"id":"e9bc7080-5964-4cf0-b1f0-f7807e4f961f","block_type":"box","text":"include the market discount in income as it accrues, gain on the Fund’s disposition of such an","page_number":80,"box":{"x":117,"y":831,"width":698,"height":12}},{"id":"dfea4242-df1a-4c44-96cc-def24a48a6c6","block_type":"box","text":"obligation will be treated as ordinary income rather than capital gain to the extent of the accrued","page_number":80,"box":{"x":116,"y":847,"width":716,"height":12}},{"id":"dbd0f97a-8a02-4b11-85a2-4fc0cf24004e","block_type":"box","text":"market discount.","page_number":80,"box":{"x":117,"y":862,"width":127,"height":10}},{"id":"5dbb14e1-a62d-4718-bc46-cf8cb74118b1","block_type":"box","text":"75","page_number":80,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"5b78f67b-5a1a-48bc-a13a-806f5a71eff7","block_type":"box","text":"NM0926U-5926888-80/257","page_number":80,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"f6d2a495-95a1-4267-b889-268f4accd97a","block_type":"box","text":"Non-U.S. Investments.","page_number":81,"box":{"x":117,"y":87,"width":182,"height":10}},{"id":"d77516c1-86eb-49f0-9b0f-6811a23ebd08","block_type":"box","text":"Income (including, in some cases, capital gains) received by the Fund from","page_number":81,"box":{"x":301,"y":87,"width":560,"height":12}},{"id":"23a1b3f6-3f1c-44a5-8ece-bdd349303251","block_type":"box","text":"investments in non-U.S. securities may be subject to withholding and other taxes imposed by non-U.S.","page_number":81,"box":{"x":117,"y":102,"width":766,"height":13}},{"id":"3085f6f9-c05f-49bf-8090-00f96641b493","block_type":"box","text":"countries. Tax conventions between certain countries and the U.S. may reduce or eliminate such taxes","page_number":81,"box":{"x":116,"y":118,"width":769,"height":12}},{"id":"ac048b44-910b-4d3e-b046-8964864dc996","block_type":"box","text":"in some cases. If more than 50% of the Fund’s total assets at the close of its taxable year consists of","page_number":81,"box":{"x":117,"y":134,"width":752,"height":12}},{"id":"48aa72cc-daec-4193-90f2-965c4c9a1922","block_type":"box","text":"securities of non-U.S. corporations, the Fund may elect for U.S. income tax purposes to treat non-U.S.","page_number":81,"box":{"x":116,"y":149,"width":765,"height":12}},{"id":"adb36de2-f903-4e6c-b580-83d9367c1b3e","block_type":"box","text":"income taxes paid by it as paid by its shareholders. The Fund may qualify for and make this election in","page_number":81,"box":{"x":117,"y":165,"width":765,"height":12}},{"id":"f6c4c849-5c26-4c87-971d-55e442d151fe","block_type":"box","text":"some, but not necessarily all, of its taxable years. If the Fund were to make an election, shareholders","page_number":81,"box":{"x":116,"y":180,"width":755,"height":12}},{"id":"5ef38719-d5ad-4c36-8ca4-e59d552e6e86","block_type":"box","text":"of the Fund would be required to take into account an amount equal to their pro rata portions of such","page_number":81,"box":{"x":116,"y":196,"width":751,"height":11}},{"id":"bbffb114-329f-4b11-bf21-8308bede9030","block_type":"box","text":"non-U.S. taxes in computing their taxable income and then treat an amount equal to those non-U.S.","page_number":81,"box":{"x":117,"y":211,"width":745,"height":12}},{"id":"72302583-9bae-47cf-952b-6a6a73d6450a","block_type":"box","text":"taxes as a U.S. federal income tax deduction or as a foreign tax credit against their U.S. federal","page_number":81,"box":{"x":116,"y":227,"width":714,"height":12}},{"id":"5fd1bcea-7120-4bd1-864d-2716cbcdac3f","block_type":"box","text":"income taxes. Shortly after any year for which it makes such an election, the Fund will report to its","page_number":81,"box":{"x":117,"y":242,"width":731,"height":12}},{"id":"d91c2d8f-f84c-4a50-a90e-658420f22d41","block_type":"box","text":"shareholders the amount per share of such non-U.S. income tax that must be included in each","page_number":81,"box":{"x":116,"y":258,"width":706,"height":11}},{"id":"2a5f60c3-a359-4f4e-bebd-b7b8054139f0","block_type":"box","text":"shareholder’s gross income and the amount which will be available for the deduction or credit. No","page_number":81,"box":{"x":116,"y":273,"width":728,"height":12}},{"id":"47013991-e500-415e-b9f2-dbe52dd9d0f3","block_type":"box","text":"deduction for non-U.S. taxes may be claimed by a shareholder who does not itemize deductions.","page_number":81,"box":{"x":116,"y":289,"width":724,"height":12}},{"id":"7ec25590-3dc8-4c5b-867f-b8f76da1586e","block_type":"box","text":"Certain limitations will be imposed on the extent to which the credit (but not the deduction) for non-U.S.","page_number":81,"box":{"x":117,"y":304,"width":768,"height":12}},{"id":"2f54772e-9d78-4e57-86d9-750ee56e37de","block_type":"box","text":"taxes may be claimed.","page_number":81,"box":{"x":116,"y":320,"width":172,"height":12}},{"id":"8513db78-51af-4f05-aa5d-fa20973cabab","block_type":"box","text":"Under Section 988 of the Internal Revenue Code, gains or losses attributable to fluctuations in","page_number":81,"box":{"x":117,"y":351,"width":703,"height":12}},{"id":"3f84c958-9570-4509-8af9-f43be83cea89","block_type":"box","text":"exchange rates between the time the Fund accrues income or receivables or expenses or other","page_number":81,"box":{"x":116,"y":366,"width":715,"height":12}},{"id":"c4b13039-4e8a-4d80-a54f-b6c8f98c14d7","block_type":"box","text":"liabilities denominated in a non-U.S. currency and the time the Fund actually collects such income or","page_number":81,"box":{"x":117,"y":382,"width":751,"height":12}},{"id":"05e9571c-904f-4c84-a18e-28acf3e8c98d","block_type":"box","text":"pays such liabilities are generally treated as ordinary income or ordinary loss. In general, gains (and","page_number":81,"box":{"x":117,"y":397,"width":745,"height":12}},{"id":"c2de8026-5d2b-40e3-95a0-57b67039c706","block_type":"box","text":"losses) realized on debt instruments will be treated as Section 988 gain (or loss) to the extent","page_number":81,"box":{"x":117,"y":413,"width":697,"height":12}},{"id":"f938da47-ae03-48a6-b0df-a65bb2c62940","block_type":"box","text":"attributable to changes in exchange rates between the U.S. dollar and the currencies in which the","page_number":81,"box":{"x":116,"y":428,"width":729,"height":12}},{"id":"8db860f7-964a-4bae-9f01-ee89ffaf9ce4","block_type":"box","text":"instruments are denominated. Similarly, gain or losses on non-U.S. currency, non-U.S. currency","page_number":81,"box":{"x":117,"y":444,"width":716,"height":12}},{"id":"5b1221fa-656e-4b11-a80f-987dd34caf7a","block_type":"box","text":"forward contracts, certain non-U.S. currency options or futures contracts and the disposition of debt","page_number":81,"box":{"x":116,"y":459,"width":743,"height":12}},{"id":"fa354e3f-c577-4873-9f8f-cbb5b41ed4bb","block_type":"box","text":"securities denominated in non-U.S. currency, to the extent attributable to fluctuations in exchange rates","page_number":81,"box":{"x":116,"y":475,"width":772,"height":12}},{"id":"942030ea-a617-4aec-8be6-0c9a17a46ddf","block_type":"box","text":"between the acquisition and disposition dates, are also treated as ordinary income or loss unless the","page_number":81,"box":{"x":117,"y":490,"width":751,"height":12}},{"id":"10cbf3ac-8dc7-4950-824d-e89d6c28f09a","block_type":"box","text":"Fund were to elect otherwise.","page_number":81,"box":{"x":117,"y":506,"width":223,"height":9}},{"id":"44de0140-a0b0-4bcb-a93f-23ffd30e2cf6","block_type":"box","text":"Original Issue Discount.","page_number":81,"box":{"x":116,"y":537,"width":191,"height":12}},{"id":"30f94c7f-d74b-4d72-8b25-2ff2d0a0ae39","block_type":"box","text":"OID on tax-exempt bonds is recognized over the term of the bond and is","page_number":81,"box":{"x":309,"y":537,"width":547,"height":12}},{"id":"57fea710-f952-40d3-be28-7353a03a5b36","block_type":"box","text":"tax-exempt to the holder of the bond. Special U.S. federal income tax rules apply to inflation-indexed","page_number":81,"box":{"x":116,"y":552,"width":751,"height":12}},{"id":"0c58c698-dfeb-4e37-9b87-5a62eba34f62","block_type":"box","text":"bonds. Generally, all stated interest on such bonds is taken into income by the Fund under its regular","page_number":81,"box":{"x":117,"y":568,"width":755,"height":12}},{"id":"998013a9-a0e6-4f33-a193-27c1a2378033","block_type":"box","text":"method of accounting for interest income. The amount of a positive inflation adjustment, which results","page_number":81,"box":{"x":117,"y":583,"width":758,"height":12}},{"id":"a288eb14-1f45-44a4-9feb-e52eee48369f","block_type":"box","text":"in an increase in the inflation-adjusted principal amount of the bond, is treated as OID. The OID is","page_number":81,"box":{"x":117,"y":599,"width":729,"height":12}},{"id":"bfd1004a-45b3-4496-b602-d56917c7d30e","block_type":"box","text":"included in the Fund’s gross income ratably during the period ending with the maturity of the bond,","page_number":81,"box":{"x":117,"y":614,"width":734,"height":12}},{"id":"e9e40d6d-0cff-4155-bb5d-004943d98cf4","block_type":"box","text":"under the general OID inclusion rules. The amount of the Fund’s OID in a taxable year with respect to","page_number":81,"box":{"x":117,"y":630,"width":759,"height":12}},{"id":"e3b48914-e68c-4fbc-920a-073c77610812","block_type":"box","text":"a bond will increase the Fund’s taxable income for such year without a corresponding receipt of cash,","page_number":81,"box":{"x":116,"y":645,"width":757,"height":12}},{"id":"6672e7b1-9c51-4f2b-aa07-431f4f825449","block_type":"box","text":"until the bond matures. As a result, the Fund may need to use other sources of cash to satisfy its","page_number":81,"box":{"x":117,"y":661,"width":717,"height":12}},{"id":"f32a50dd-a074-4a9b-96ff-dbd26ea7fca4","block_type":"box","text":"distributions for such year. The amount of negative inflation adjustment, which results in a decrease in","page_number":81,"box":{"x":116,"y":676,"width":757,"height":12}},{"id":"625b4760-a668-40af-ad2e-cdf76fd3d2cf","block_type":"box","text":"the inflation-adjusted principal amount of the bond, reduces the amount of interest (including stated,","page_number":81,"box":{"x":116,"y":692,"width":739,"height":12}},{"id":"84883b3b-a904-46c4-8459-f6709973c771","block_type":"box","text":"interest, OID, and market discount, if any) otherwise includible in the Fund’s income with respect to the","page_number":81,"box":{"x":117,"y":707,"width":762,"height":12}},{"id":"1d08697f-c4cd-4d6b-94ec-0fbd31adca35","block_type":"box","text":"bond for the taxable year.","page_number":81,"box":{"x":117,"y":723,"width":188,"height":12}},{"id":"4e5d53b0-5c61-4426-ac44-3374fbee02ec","block_type":"box","text":"Reporting.","page_number":81,"box":{"x":117,"y":754,"width":82,"height":12}},{"id":"2637c541-f113-4aaa-89a4-e28a6759d5eb","block_type":"box","text":"If a shareholder recognizes a loss with respect to the Fund’s shares of $2 million or more","page_number":81,"box":{"x":206,"y":753,"width":659,"height":13}},{"id":"7c08ef92-8b22-456d-88ed-71bf804e4d98","block_type":"box","text":"for an individual shareholder or $10 million or more for a corporate shareholder, the shareholder must","page_number":81,"box":{"x":116,"y":768,"width":754,"height":13}},{"id":"cf76fc9d-3d2f-4d70-8fb6-669dec72c5dc","block_type":"box","text":"file with the IRS a disclosure statement on IRS Form 8886. Direct shareholders of portfolio securities","page_number":81,"box":{"x":116,"y":785,"width":746,"height":12}},{"id":"4bb2b966-68e0-4d03-bff8-63f8d9e9ec84","block_type":"box","text":"are in many cases exempted from this reporting requirement, but under current guidance, shareholders","page_number":81,"box":{"x":116,"y":800,"width":767,"height":12}},{"id":"103c5020-e147-4b2b-8166-60b36f761f2e","block_type":"box","text":"of a RIC are not exempted. The fact that a loss is reportable under these regulations does not affect","page_number":81,"box":{"x":116,"y":816,"width":742,"height":12}},{"id":"d025d3db-87b3-4f82-a382-7975fd8bc526","block_type":"box","text":"the legal determination of whether the taxpayer’s treatment of the loss is proper. Shareholders should","page_number":81,"box":{"x":116,"y":831,"width":759,"height":12}},{"id":"e671ea33-9477-42cd-adec-4fa11db51907","block_type":"box","text":"consult their tax advisors to determine the applicability of these regulations in light of their individual","page_number":81,"box":{"x":116,"y":847,"width":744,"height":12}},{"id":"c3225954-cd65-4498-965d-e508a1a7d60f","block_type":"box","text":"circumstances.","page_number":81,"box":{"x":116,"y":862,"width":117,"height":10}},{"id":"71b6a078-5a60-4f40-a3c1-df36dcf7836c","block_type":"box","text":"76","page_number":81,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"a0556e99-411f-46a9-ac1d-95e271ff6162","block_type":"box","text":"NM0926U-5926888-81/257","page_number":81,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"d506e4d5-a9ea-4f99-aa8a-6008a1ed7b18","block_type":"box","text":"Other Taxes.","page_number":82,"box":{"x":116,"y":87,"width":100,"height":10}},{"id":"3b513f4a-08f2-417f-ae4a-01c469d2ba77","block_type":"box","text":"Dividends, distributions and redemption proceeds may also be subject to additional","page_number":82,"box":{"x":218,"y":87,"width":627,"height":12}},{"id":"f976ce0c-a68d-4344-bdfb-ace3c216a96d","block_type":"box","text":"state, local and non-U.S. taxes depending on each shareholder’s particular situation.","page_number":82,"box":{"x":116,"y":102,"width":633,"height":13}},{"id":"1378d71e-296a-4aa3-bacd-266bb99fab9d","block_type":"box","text":"Taxation of Non-U.S. Shareholders.","page_number":82,"box":{"x":116,"y":134,"width":281,"height":9}},{"id":"8c65a722-ce3f-4d69-a931-ffe72c143308","block_type":"box","text":"Dividends paid by the Fund to non-U.S. shareholders are","page_number":82,"box":{"x":398,"y":134,"width":434,"height":12}},{"id":"43892bcf-768c-4cba-85de-178f176ee829","block_type":"box","text":"generally subject to withholding tax at a 30% rate or a reduced rate specified by an applicable income","page_number":82,"box":{"x":116,"y":149,"width":759,"height":12}},{"id":"1fb15fea-3c3f-416c-9127-e83b5fcf4519","block_type":"box","text":"tax treaty to the extent derived from investment income and short-term capital gains. Dividends paid by","page_number":82,"box":{"x":116,"y":165,"width":769,"height":12}},{"id":"6e5e9a27-ee07-42ed-a5e1-6bb6526643f7","block_type":"box","text":"the Fund from net tax-exempt income or long-term capital gains are generally not subject to such","page_number":82,"box":{"x":116,"y":180,"width":725,"height":12}},{"id":"39167c46-a29c-4787-b9b4-0c1a36eb3e3f","block_type":"box","text":"withholding tax. In order to obtain a reduced rate of withholding, a non-U.S. shareholder will be","page_number":82,"box":{"x":116,"y":196,"width":708,"height":12}},{"id":"1b42b452-e086-44c7-8d2d-1430c2b037f8","block_type":"box","text":"required to provide an IRS Form W-8BEN or IRS Form W-8BEN-E certifying its entitlement to benefits","page_number":82,"box":{"x":117,"y":211,"width":760,"height":12}},{"id":"3c5177b8-5957-4ae7-a890-83a2fc738333","block_type":"box","text":"under a treaty. The withholding tax does not apply to regular dividends paid to a non-U.S. shareholder","page_number":82,"box":{"x":117,"y":227,"width":761,"height":12}},{"id":"24efe10f-205c-47dd-83dd-3e315cc12ee5","block_type":"box","text":"who provides an IRS Form W-8ECI, certifying that the dividends are effectively connected with the","page_number":82,"box":{"x":116,"y":242,"width":734,"height":12}},{"id":"fbf1da2d-cd33-4b9f-a6bc-cd683e10e52b","block_type":"box","text":"non-U.S. shareholder’s conduct of a trade or business within the U.S. Instead, the effectively","page_number":82,"box":{"x":117,"y":258,"width":691,"height":12}},{"id":"8f2f8afa-94c1-4c7e-a9ea-22cb9ccd0e56","block_type":"box","text":"connected dividends will be subject to regular U.S. income tax as if the non-U.S. shareholder were a","page_number":82,"box":{"x":116,"y":273,"width":750,"height":12}},{"id":"1bbbaf3e-03c1-4a4c-aa52-c8c4924a6fba","block_type":"box","text":"U.S. shareholder. A non-U.S. corporation receiving effectively connected dividends may also be","page_number":82,"box":{"x":117,"y":289,"width":715,"height":12}},{"id":"76752275-621c-4b51-a6d2-0e013086f8da","block_type":"box","text":"subject to additional “branch profits tax” imposed at a rate of 30% (or lower treaty rate). A non-U.S.","page_number":82,"box":{"x":116,"y":304,"width":738,"height":12}},{"id":"ddeba3e0-16fa-4331-a777-378563fd9593","block_type":"box","text":"shareholder who fails to provide an IRS Form W-8BEN, IRS Form W-8BEN-E or other applicable form","page_number":82,"box":{"x":116,"y":320,"width":762,"height":12}},{"id":"2701049d-24fe-4b5f-881a-572d40a89877","block_type":"box","text":"may be subject to backup withholding at the appropriate rate.","page_number":82,"box":{"x":117,"y":335,"width":458,"height":12}},{"id":"985c6055-d32a-48a8-811d-c42540d8a2e1","block_type":"box","text":"Properly-reported dividends are generally exempt from U.S. federal withholding tax where they (i) are","page_number":82,"box":{"x":117,"y":366,"width":756,"height":12}},{"id":"557493f3-0ad5-4be9-ad30-e10a2ee39473","block_type":"box","text":"paid in respect of the Fund’s “qualified net interest income” (generally, the Fund’s U.S. source interest","page_number":82,"box":{"x":117,"y":382,"width":759,"height":12}},{"id":"cad682d3-ff64-4be5-994c-1f547d160f80","block_type":"box","text":"income, other than certain contingent interest and interest from obligations of a corporation or","page_number":82,"box":{"x":117,"y":397,"width":698,"height":12}},{"id":"70befd16-6616-425b-a222-1b483d2539cd","block_type":"box","text":"partnership in which the Fund is at least a 10% shareholder or partner, reduced by expenses that are","page_number":82,"box":{"x":117,"y":413,"width":755,"height":12}},{"id":"3b4ccf32-735d-4449-bcf6-8b3cfd9f5285","block_type":"box","text":"allocable to such income); or (ii) are paid in respect of the Fund’s “qualified short-term capital gains”","page_number":82,"box":{"x":116,"y":428,"width":745,"height":12}},{"id":"5f9d3348-dca6-47a6-9f8d-4e673f21b1d1","block_type":"box","text":"(generally, the excess of the Fund’s net short-term capital gain over the Fund’s long-term capital loss","page_number":82,"box":{"x":117,"y":444,"width":753,"height":12}},{"id":"02fcafd4-62f7-47fb-828f-cca21794e622","block_type":"box","text":"for such taxable year). However, depending on its circumstances, the Fund may report all, some or","page_number":82,"box":{"x":116,"y":459,"width":740,"height":12}},{"id":"3dab48f3-7776-48da-8b9d-45fec1c2f348","block_type":"box","text":"none of its potentially eligible dividends as such qualified net interest income or as qualified short-term","page_number":82,"box":{"x":117,"y":475,"width":762,"height":12}},{"id":"e1d74fd9-0d4f-46cb-84a2-965adeafe9bf","block_type":"box","text":"capital gains and/or treat such dividends, in whole or in part, as ineligible for this exemption from","page_number":82,"box":{"x":116,"y":490,"width":720,"height":12}},{"id":"f420bfca-ff76-4ae3-bce4-0898e5b553b4","block_type":"box","text":"withholding. In order to qualify for this exemption from withholding, a non-U.S. shareholder will need to","page_number":82,"box":{"x":116,"y":506,"width":765,"height":12}},{"id":"24eeeb2e-5811-4d20-bc54-3f40855b9de8","block_type":"box","text":"comply with applicable certification requirements relating to its non-U.S. status (including, in general,","page_number":82,"box":{"x":116,"y":521,"width":751,"height":12}},{"id":"62346b85-8189-427c-8582-99e1a230683f","block_type":"box","text":"furnishing an IRS Form W-8BEN, IRS Form W-8BEN-E or substitute Form). In the case of shares held","page_number":82,"box":{"x":116,"y":537,"width":764,"height":12}},{"id":"a9d81495-e433-43a4-8830-53d0690777f3","block_type":"box","text":"through an intermediary, the intermediary may withhold even if the Fund reports the payment as","page_number":82,"box":{"x":116,"y":552,"width":718,"height":12}},{"id":"307f6974-3f1c-4fba-9c06-e2efd2404298","block_type":"box","text":"qualified net interest income or qualified short-term capital gain. Non-U.S. shareholders should contact","page_number":82,"box":{"x":116,"y":568,"width":766,"height":12}},{"id":"9d981200-bd07-4e72-940e-817913a25a87","block_type":"box","text":"their intermediaries with respect to the application of these rules to their accounts.","page_number":82,"box":{"x":116,"y":583,"width":613,"height":12}},{"id":"3e1e6736-7c42-4e0d-a393-3122e0e74353","block_type":"box","text":"Special rules may apply to a foreign shareholder receiving the Fund distribution if at least 50% of the","page_number":82,"box":{"x":116,"y":614,"width":751,"height":12}},{"id":"ff9e51ee-5f0b-4517-84dd-283a348c5b47","block_type":"box","text":"Fund’s assets consist of interests in U.S. real property interests, including certain REITs and U.S. real","page_number":82,"box":{"x":117,"y":630,"width":759,"height":12}},{"id":"e8feb538-9056-4615-b7f0-4d079cdceb33","block_type":"box","text":"property holding corporations (as defined in the Internal Revenue Code and Treasury regulations).","page_number":82,"box":{"x":117,"y":645,"width":734,"height":12}},{"id":"deb90a5f-7304-41fa-9360-5e54216b3b36","block_type":"box","text":"Fund distributions that are attributable to gain from the disposition of a U.S. real property interest will","page_number":82,"box":{"x":117,"y":676,"width":744,"height":12}},{"id":"76517976-4777-498d-b4df-b7774399a422","block_type":"box","text":"be taxable as ordinary dividends and subject to withholding at a 30% or lower treaty rate if the foreign","page_number":82,"box":{"x":117,"y":692,"width":751,"height":12}},{"id":"85e3bfdc-5001-48f1-81cb-019c8858d823","block_type":"box","text":"shareholder held no more than 5% of the Fund’s shares at any time during the one-year period ending","page_number":82,"box":{"x":116,"y":707,"width":759,"height":12}},{"id":"66caa74a-ec6c-4f68-a727-02895883f21b","block_type":"box","text":"on the date of the distribution. If the foreign shareholder held at least 5% of the Fund’s shares, the","page_number":82,"box":{"x":116,"y":723,"width":727,"height":12}},{"id":"bfd72761-e3b2-4f46-9b1f-bc0d97dcc066","block_type":"box","text":"distribution would be treated as income effectively connected with a trade or business within the U.S.","page_number":82,"box":{"x":116,"y":738,"width":748,"height":12}},{"id":"ce51566e-4978-4d5f-899a-0088710ceeeb","block_type":"box","text":"and the foreign shareholder would be subject to withholding tax at a rate of 21% and would generally","page_number":82,"box":{"x":116,"y":754,"width":748,"height":12}},{"id":"9b47d569-f10d-4c7a-99fb-0de9cc47cda5","block_type":"box","text":"be required to file a U.S. federal income tax return.","page_number":82,"box":{"x":117,"y":769,"width":374,"height":12}},{"id":"d1ca218d-4169-4b4c-ab09-8c8cae5e4ac7","block_type":"box","text":"Similar consequences would generally apply to a foreign shareholder’s gain on the sale of Fund shares","page_number":82,"box":{"x":116,"y":800,"width":765,"height":12}},{"id":"57fe6b9f-f81a-4f6b-8d87-f4673f55044f","block_type":"box","text":"unless the Fund is domestically controlled (meaning that more than 50% of the value of the Fund’s","page_number":82,"box":{"x":117,"y":816,"width":730,"height":12}},{"id":"61fdcf53-12bb-4aba-b7b0-5b8ec6822e3f","block_type":"box","text":"shares is held by U.S. shareholders) or the foreign shareholder owns no more than 5% of the Fund’s","page_number":82,"box":{"x":116,"y":831,"width":752,"height":12}},{"id":"ad11f5d9-d9e6-4170-aa90-efbc4c807d41","block_type":"box","text":"shares at any time during the five-year period ending on the date of sale. Finally, a domestically","page_number":82,"box":{"x":116,"y":847,"width":715,"height":12}},{"id":"602ef719-41b4-4dea-9508-4a8204a1da55","block_type":"box","text":"controlled Fund may be required to recognize a portion of its gain on the in-kind distribution of certain","page_number":82,"box":{"x":116,"y":862,"width":756,"height":12}},{"id":"23ead3fc-18ff-4def-8920-8c4d522adae1","block_type":"box","text":"U.S. real property interests.","page_number":82,"box":{"x":117,"y":878,"width":208,"height":12}},{"id":"4fc5a097-b394-4400-aa93-7bcb124a2f01","block_type":"box","text":"77","page_number":82,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"7cfe63c2-f600-41d4-b64d-5d2fc3001f91","block_type":"box","text":"NM0926U-5926888-82/257","page_number":82,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"e9c56bbe-0127-401c-9443-94a751d5b989","block_type":"box","text":"The rules laid out in the previous paragraph, other than the withholding rules, will apply notwithstanding","page_number":83,"box":{"x":116,"y":87,"width":771,"height":12}},{"id":"18821e78-d03b-4afe-b412-cd19d98fdf75","block_type":"box","text":"the Fund’s participation in a wash sale transaction or its payment of a substitute dividend.","page_number":83,"box":{"x":116,"y":102,"width":669,"height":13}},{"id":"c48b4234-00ca-49f5-9e0f-e0b8b589f019","block_type":"box","text":"Shareholders that are nonresident aliens or foreign entities are urged to consult their own tax advisors","page_number":83,"box":{"x":116,"y":134,"width":762,"height":12}},{"id":"a2a8a50f-55b9-43ef-a7b7-b10f1dff453c","block_type":"box","text":"concerning the particular tax consequences to them of an investment in the Fund.","page_number":83,"box":{"x":116,"y":150,"width":612,"height":12}},{"id":"78c96f9e-017b-4c1d-b7a8-fdf8ca7a363e","block_type":"box","text":"Separately, a 30% withholding tax is currently imposed on U.S.-source dividends, interest and other","page_number":83,"box":{"x":116,"y":181,"width":745,"height":12}},{"id":"8de570c9-c7f8-4ad1-a9ce-c3062fb34dc7","block_type":"box","text":"income items paid to: (i) foreign financial institutions, including non-U.S. investment funds, unless they","page_number":83,"box":{"x":117,"y":197,"width":762,"height":12}},{"id":"e67b5def-fc40-450e-b413-71b3b54d2e51","block_type":"box","text":"agree to collect and disclose to the IRS information regarding their direct and indirect U.S. account","page_number":83,"box":{"x":116,"y":212,"width":736,"height":12}},{"id":"a882425c-f454-4632-bcab-ad9fd37b6e4c","block_type":"box","text":"holders and (ii) certain other foreign entities, unless they certify certain information regarding their","page_number":83,"box":{"x":117,"y":228,"width":728,"height":12}},{"id":"9e415bf8-97ea-43b0-a4cd-41f275f98873","block_type":"box","text":"direct and indirect U.S. owners. To avoid withholding, foreign financial institutions will need to: (i) enter","page_number":83,"box":{"x":116,"y":243,"width":764,"height":12}},{"id":"8716234a-c928-43c2-b98c-8e36e3e547e7","block_type":"box","text":"into agreements with the IRS that state that they will provide the IRS information including the names,","page_number":83,"box":{"x":117,"y":259,"width":759,"height":12}},{"id":"cb38c912-7814-4f7a-9eb5-226b74e9bd8d","block_type":"box","text":"addresses and taxpayer identification numbers of direct and indirect U.S. account holders; comply with","page_number":83,"box":{"x":116,"y":274,"width":767,"height":12}},{"id":"969adcd2-b7e2-405f-adaa-e70bb6f083fa","block_type":"box","text":"due diligence procedures with respect to the identification of U.S. accounts; report to the IRS certain","page_number":83,"box":{"x":116,"y":290,"width":748,"height":12}},{"id":"3c18f9e9-8b49-4040-af41-a4e855b38a7c","block_type":"box","text":"information with respect to U.S. accounts maintained; agree to withhold tax on certain payments made","page_number":83,"box":{"x":117,"y":305,"width":764,"height":12}},{"id":"9dac33f5-6fa4-496e-bad5-ff58402a9674","block_type":"box","text":"to non-compliant foreign financial institutions or to account holders who fail to provide the required","page_number":83,"box":{"x":116,"y":321,"width":732,"height":12}},{"id":"b978fded-b40f-4353-8693-d2685e29a84a","block_type":"box","text":"information; and determine certain other information as to their account holders, or (ii) in the event that","page_number":83,"box":{"x":117,"y":336,"width":764,"height":12}},{"id":"c6b72aec-46cc-4472-b200-1cd4974342ad","block_type":"box","text":"an applicable intergovernmental agreement and implementing legislation are adopted, provide local","page_number":83,"box":{"x":116,"y":352,"width":743,"height":12}},{"id":"31fd16f4-743c-470e-ad08-7401945f441c","block_type":"box","text":"revenue authorities with similar account holder information. Other foreign entities will need to provide","page_number":83,"box":{"x":117,"y":367,"width":752,"height":12}},{"id":"04b4b4c1-aee0-4bc8-afb8-adb54dc3a1b8","block_type":"box","text":"the name, address and taxpayer identification number of each substantial U.S. owner or provide","page_number":83,"box":{"x":116,"y":383,"width":718,"height":12}},{"id":"9ee214b4-7f97-4fae-865f-6dca6f092b4a","block_type":"box","text":"certifications of no substantial U.S. ownership, unless certain exceptions apply.","page_number":83,"box":{"x":116,"y":398,"width":592,"height":12}},{"id":"c13d747d-bc52-4114-a92f-736987f02921","block_type":"box","text":"Shares of the Fund held by a non-U.S. shareholder at death will be considered situated within the U.S.","page_number":83,"box":{"x":116,"y":430,"width":766,"height":12}},{"id":"28f0cb50-1b88-4696-9bee-f94948236a79","block_type":"box","text":"and subject to the U.S. estate tax.","page_number":83,"box":{"x":116,"y":445,"width":257,"height":12}},{"id":"dae52d7e-b324-4073-a410-838f7ae51c39","block_type":"box","text":"The foregoing discussion is a summary of certain material U.S. federal income tax considerations only","page_number":83,"box":{"x":116,"y":477,"width":763,"height":12}},{"id":"2e12168d-d906-4db0-8c17-168b99be311e","block_type":"box","text":"and is not intended as a substitute for careful tax planning. Purchasers of shares should consult their","page_number":83,"box":{"x":116,"y":492,"width":753,"height":12}},{"id":"da6fc2ba-7c40-4f2a-9ce3-d196e5a5aead","block_type":"box","text":"own tax advisors as to the tax consequences of investing in such shares, including consequences","page_number":83,"box":{"x":116,"y":508,"width":731,"height":12}},{"id":"82d8089f-9cce-404d-a66d-5034c011eeb0","block_type":"box","text":"under state, local and non-U.S. tax laws. Finally, the foregoing discussion is based on applicable","page_number":83,"box":{"x":117,"y":523,"width":721,"height":12}},{"id":"b71420e6-cf12-4ef4-b7d6-7c873bd2d01c","block_type":"box","text":"provisions of the Internal Revenue Code, regulations, judicial authority and administrative","page_number":83,"box":{"x":117,"y":539,"width":667,"height":12}},{"id":"0e0923a2-aaa0-471c-ab3f-34e565aa83e8","block_type":"box","text":"interpretations in effect on the date of this SAI. Changes in applicable authority could materially affect","page_number":83,"box":{"x":117,"y":554,"width":756,"height":12}},{"id":"4ff2ebef-7a61-4508-9aac-b1efdd56ca1e","block_type":"box","text":"the conclusions discussed above, and such changes often occur.","page_number":83,"box":{"x":116,"y":570,"width":489,"height":12}},{"id":"3493753f-2714-41b4-b1ce-5a827a73621c","block_type":"box","text":"Miscellaneous Information","page_number":83,"box":{"x":119,"y":622,"width":477,"height":23}},{"id":"e70e267c-7f22-4ad5-b0ff-75288f8d587c","block_type":"box","text":"Counsel.","page_number":83,"box":{"x":116,"y":675,"width":69,"height":9}},{"id":"0ce14d92-1165-4d56-b1c4-b19a74a8fb47","block_type":"box","text":"Willkie Farr & Gallagher LLP, located at 787 Seventh Avenue, New York, NY 10019, is","page_number":83,"box":{"x":192,"y":675,"width":642,"height":12}},{"id":"595f36db-1460-44cb-906f-0580e8f39902","block_type":"box","text":"counsel to the Trust.","page_number":83,"box":{"x":116,"y":691,"width":151,"height":9}},{"id":"609435e6-f01f-401f-a9b9-a5d0faf7a19e","block_type":"box","text":"Independent Registered Public Accounting Firm.","page_number":83,"box":{"x":117,"y":722,"width":388,"height":12}},{"id":"3d89d11e-ea5b-4af4-a340-5099c6e48237","block_type":"box","text":"Deloitte & Touche LLP, located at 115 Federal","page_number":83,"box":{"x":512,"y":722,"width":343,"height":11}},{"id":"aec4037b-3267-4303-9ba4-aa6b0ddbb9b7","block_type":"box","text":"Street, Boston, Massachusetts 02110, serves as the Trust’s independent registered public accounting","page_number":83,"box":{"x":116,"y":737,"width":755,"height":12}},{"id":"b6ebeb74-216d-40d6-b574-f1b8af4e5ab1","block_type":"box","text":"firm, audits the Fund’s financial statements, and may perform other services. Deloitte & Touche LLP,","page_number":83,"box":{"x":116,"y":753,"width":746,"height":12}},{"id":"42e6901c-d636-4188-a394-655be520742d","block_type":"box","text":"with offices located at 115 Federal Street, Boston, Massachusetts 02110, served as the Predecessor","page_number":83,"box":{"x":116,"y":768,"width":750,"height":12}},{"id":"5c6a8f26-35ec-4e31-a2b9-d2daecadb868","block_type":"box","text":"Fund’s independent registered public accounting firm.","page_number":83,"box":{"x":117,"y":784,"width":396,"height":12}},{"id":"e65775db-08d4-428d-a3eb-b92055fcbd83","block_type":"box","text":"Investors’ Rights.","page_number":83,"box":{"x":117,"y":816,"width":139,"height":12}},{"id":"f01fd0cc-b5d1-46a8-b3ed-97e7b4a1819f","block_type":"box","text":"The Fund relies on the services of BFA and its other service providers, including","page_number":83,"box":{"x":262,"y":815,"width":595,"height":13}},{"id":"a0ca8a68-9c6e-46ae-bec9-0d817a020ac2","block_type":"box","text":"the Distributor, administrator, custodian and transfer agent. Further information about the duties and","page_number":83,"box":{"x":116,"y":831,"width":748,"height":12}},{"id":"51f436b1-7f51-42b2-9763-f95f7473c66c","block_type":"box","text":"roles of these service providers is set out in this SAI. Investors who acquire shares of the Fund are not","page_number":83,"box":{"x":117,"y":846,"width":764,"height":12}},{"id":"ac1b9853-31a1-4028-a0c4-bcc3a5bdf248","block_type":"box","text":"parties to the relevant agreement with these service providers and do not have express contractual","page_number":83,"box":{"x":117,"y":862,"width":739,"height":12}},{"id":"8c0eb83c-887c-4ad5-b0c0-579b9fed04cd","block_type":"box","text":"rights against the Fund or its service providers, except certain institutional investors that are Authorized","page_number":83,"box":{"x":117,"y":878,"width":770,"height":12}},{"id":"fdb156bb-1bda-45e5-bac0-87b1ab7f4ecb","block_type":"box","text":"78","page_number":83,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"cad05955-2bbd-4e03-bd2f-7eaf279dce5d","block_type":"box","text":"NM0926U-5926888-83/257","page_number":83,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"80a1fe99-c361-4bc6-a6df-07d9f7b4be8c","block_type":"box","text":"Participants may have certain express contractual rights with respect to the Distributor under the terms","page_number":84,"box":{"x":117,"y":87,"width":766,"height":12}},{"id":"33f6b329-804e-4c51-8054-b62f40f89709","block_type":"box","text":"of the relevant Authorized Participant Agreement. Investors may have certain legal rights under federal","page_number":84,"box":{"x":116,"y":102,"width":768,"height":13}},{"id":"c38294fa-92d0-4ff3-b650-95f071546c97","block_type":"box","text":"or state law against the Fund or its service providers. In the event that an investor considers that it may","page_number":84,"box":{"x":116,"y":118,"width":770,"height":12}},{"id":"cfca95a8-20b0-4416-8578-2f17dd538202","block_type":"box","text":"have a claim against the Fund, or against any service provider in connection with its investment in the","page_number":84,"box":{"x":117,"y":134,"width":758,"height":12}},{"id":"0c65d803-1bdf-48aa-bcc5-5cf6f3943ffa","block_type":"box","text":"Fund, such investor should consult its own legal advisor.","page_number":84,"box":{"x":117,"y":149,"width":423,"height":12}},{"id":"fc298311-1731-49a0-9ce6-185c3cc1eb96","block_type":"box","text":"By contract, Authorized Participants irrevocably submit to the non-exclusive jurisdiction of any New","page_number":84,"box":{"x":117,"y":180,"width":738,"height":12}},{"id":"cf06eefe-4632-414d-99ca-a95bf951f590","block_type":"box","text":"York State or U.S. federal court sitting in New York City over any suit, action or proceeding arising out","page_number":84,"box":{"x":116,"y":196,"width":760,"height":12}},{"id":"abb5eccc-708b-4110-9bef-024093c7d3b8","block_type":"box","text":"of or relating to the Authorized Participant Agreement. Jurisdiction over other claims, whether by","page_number":84,"box":{"x":116,"y":211,"width":719,"height":12}},{"id":"3ce90eeb-d10e-41d6-8bc3-1cc54f67a9a8","block_type":"box","text":"investors or Authorized Participants, will turn on the facts of the particular case and the law of the","page_number":84,"box":{"x":117,"y":227,"width":725,"height":11}},{"id":"8850f14c-8c63-47f2-852d-0fe6cd14d8fb","block_type":"box","text":"jurisdiction in which the proceeding is brought.","page_number":84,"box":{"x":115,"y":242,"width":349,"height":12}},{"id":"cd375e8d-7791-4320-ab65-4acfa4541dd5","block_type":"box","text":"Financial Statements","page_number":84,"box":{"x":119,"y":293,"width":385,"height":23}},{"id":"52d9ea26-2389-4c46-8b37-eb2c28e9ed49","block_type":"box","text":"The audited financial statements, financial highlights and notes thereto in the Fund’s Annual Financial","page_number":84,"box":{"x":116,"y":345,"width":759,"height":12}},{"id":"b32f8480-1e3d-4f1a-a512-8cc5d9c182cb","block_type":"box","text":"Statements and Additional Information for the fiscal year ended April 30, 2026, as filed with the SEC on","page_number":84,"box":{"x":116,"y":361,"width":771,"height":12}},{"id":"d2c37797-485e-45a9-96a0-221c2fd089fd","block_type":"box","text":"Form N-CSR (the “2026 Annual Financial Statements”), are incorporated in this SAI by reference. No","page_number":84,"box":{"x":117,"y":376,"width":754,"height":13}},{"id":"6461795b-2825-4663-87f9-e183c5ff6744","block_type":"box","text":"other parts of the 2026 Annual Financial Statements are incorporated by reference herein. The 2026","page_number":84,"box":{"x":116,"y":392,"width":750,"height":12}},{"id":"1a68ebaf-cc6a-49ab-befa-d296cc9db418","block_type":"box","text":"Annual Financial Statements have been audited by Deloitte & Touche LLP. The report of Deloitte &","page_number":84,"box":{"x":116,"y":407,"width":741,"height":13}},{"id":"9784674a-758d-485f-b5b4-3ba8c94a2cb2","block_type":"box","text":"Touche LLP is incorporated herein by reference. Such 2026 Annual Financial Statements have been","page_number":84,"box":{"x":116,"y":423,"width":752,"height":12}},{"id":"8af03efc-4777-4447-94aa-d2ac28f0477b","block_type":"box","text":"incorporated herein in reliance upon the report of such firm given their authority as experts in","page_number":84,"box":{"x":117,"y":438,"width":692,"height":13}},{"id":"b929566a-3860-4db5-b419-71d6a98f21b6","block_type":"box","text":"accounting and auditing. Additional copies of the Fund’s Annual and Semi-Annual Reports to","page_number":84,"box":{"x":116,"y":454,"width":693,"height":12}},{"id":"c9970a33-44d6-4f83-bfc0-e45661e9b620","block_type":"box","text":"shareholders and the Fund’s Annual and Semi-Annual Financial Statements and Additional Information","page_number":84,"box":{"x":116,"y":469,"width":770,"height":10}},{"id":"51375502-1114-4b58-9bd9-d822d60a7d9e","block_type":"box","text":"may be obtained at no charge by telephoning the Distributor at the telephone number appearing on the","page_number":84,"box":{"x":117,"y":485,"width":768,"height":12}},{"id":"2fe2307c-757e-42a2-bd78-196f6cf36446","block_type":"box","text":"front page of this SAI.","page_number":84,"box":{"x":116,"y":500,"width":166,"height":13}},{"id":"3a1dfe78-f364-4960-9d6d-6ef5c7d81b71","block_type":"box","text":"79","page_number":84,"box":{"x":491,"y":909,"width":17,"height":9}},{"id":"06b56189-d930-4f63-b53c-df333c385d14","block_type":"box","text":"NM0926U-5926888-84/257","page_number":84,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"45992cbe-60fd-4d88-b026-4885bda639f4","block_type":"box","text":"PART II","page_number":85,"box":{"x":432,"y":92,"width":149,"height":22}},{"id":"b771b0d8-d1f3-4340-9785-47da2e131da7","block_type":"box","text":"Throughout this Statement of Additional Information (“SAI”), each BlackRock-advised fund may be","page_number":85,"box":{"x":116,"y":143,"width":734,"height":12}},{"id":"cb8c95bd-c4fe-4272-9810-d931a91c145c","block_type":"box","text":"referred to as a “Fund” or collectively with others as the “Funds.” Certain Funds may also be referred to","page_number":85,"box":{"x":117,"y":158,"width":770,"height":13}},{"id":"cd22e02d-d5b8-469f-bab5-654a3fc820f6","block_type":"box","text":"as “Municipal Funds” if they invest certain of their assets in municipal investments described below.","page_number":85,"box":{"x":116,"y":174,"width":743,"height":12}},{"id":"4963d695-a42b-4b74-aec4-5c7daf071a02","block_type":"box","text":"Each Fund is organized either as a Maryland corporation, a Massachusetts business trust or a","page_number":85,"box":{"x":117,"y":205,"width":704,"height":11}},{"id":"874c8504-2ccb-46ba-bf16-91d560d8c7c2","block_type":"box","text":"Delaware statutory trust. In each jurisdiction, nomenclature varies. For ease and clarity of presentation,","page_number":85,"box":{"x":117,"y":220,"width":769,"height":12}},{"id":"42905bb4-0619-4b8a-9050-aff47c386597","block_type":"box","text":"shares of common stock and shares of beneficial interest are referred to herein as “shares” or","page_number":85,"box":{"x":116,"y":235,"width":701,"height":10}},{"id":"841a76ae-ba96-443b-b344-5665acd809cb","block_type":"box","text":"“Common Stock,” holders of shares of Common Stock are referred to as “shareholders,” the trustees","page_number":85,"box":{"x":116,"y":251,"width":752,"height":11}},{"id":"9990b748-f5a8-4091-b170-e1babbe476c3","block_type":"box","text":"or directors of each Fund are referred to as “Directors,” the boards of trustees/directors of each Fund","page_number":85,"box":{"x":116,"y":266,"width":754,"height":12}},{"id":"ca5162b2-37df-417b-8a7b-56c141585a18","block_type":"box","text":"are referred to as the “Board of Directors” or the “Board,” BlackRock Advisors, LLC, BlackRock Fund","page_number":85,"box":{"x":116,"y":282,"width":752,"height":11}},{"id":"04299474-4dbc-417f-9590-222f2ae25faf","block_type":"box","text":"Advisors or their respective affiliates is the investment adviser or manager of each Fund and is referred","page_number":85,"box":{"x":116,"y":297,"width":771,"height":12}},{"id":"c0464f80-8729-41da-9b4a-04efdf9d3795","block_type":"box","text":"to herein as the “Manager” or “BlackRock,” and the investment advisory agreement or management","page_number":85,"box":{"x":116,"y":313,"width":745,"height":12}},{"id":"25083091-a7f7-4e2d-89fe-926c1007d075","block_type":"box","text":"agreement applicable to each Fund is referred to as the “Management Agreement.” Each Fund’s","page_number":85,"box":{"x":116,"y":328,"width":722,"height":13}},{"id":"16e567bf-813f-4b4d-9961-66ea10211416","block_type":"box","text":"Articles of Incorporation or Declaration of Trust, together with all amendments thereto, is referred to as","page_number":85,"box":{"x":116,"y":344,"width":765,"height":12}},{"id":"426eba24-caee-49d9-9037-540e00ef85fe","block_type":"box","text":"its “charter.” The Investment Company Act of 1940, as amended, is referred to herein as the","page_number":85,"box":{"x":117,"y":359,"width":689,"height":13}},{"id":"a3d3b59a-fe1c-4c9b-9bdf-add3f8f2c6a1","block_type":"box","text":"“Investment Company Act.” The Securities Act of 1933, as amended, is referred to herein as the","page_number":85,"box":{"x":116,"y":375,"width":719,"height":12}},{"id":"a9c870b9-1560-42f0-99f7-26e6b60f9e1c","block_type":"box","text":"“Securities Act.” The Securities and Exchange Commission is referred to herein as the “Commission”","page_number":85,"box":{"x":116,"y":390,"width":755,"height":13}},{"id":"9dd0da67-93c8-41ab-8828-0427eb03c383","block_type":"box","text":"or the “SEC.”","page_number":85,"box":{"x":116,"y":406,"width":103,"height":9}},{"id":"5a26b4f9-e7eb-4ac1-95c0-905e87106f23","block_type":"box","text":"Certain Funds are “feeder” funds (each, a “Feeder Fund”) that invest all or a portion of their assets in a","page_number":85,"box":{"x":117,"y":436,"width":765,"height":12}},{"id":"bce13b3d-4bdc-4a70-9357-e532231dc527","block_type":"box","text":"corresponding “master” portfolio (each, a “Master Portfolio”) of a master limited liability company (each,","page_number":85,"box":{"x":116,"y":452,"width":770,"height":12}},{"id":"4429552e-dac0-4001-9b56-e6ceec6e2941","block_type":"box","text":"a “Master LLC”), a mutual fund that has the same objective and strategies as the Feeder Fund. All","page_number":85,"box":{"x":116,"y":467,"width":734,"height":12}},{"id":"18b2c396-7dd9-4773-bed2-8a816dce2a29","block_type":"box","text":"investments are generally made at the level of the Master Portfolio. This structure is sometimes called","page_number":85,"box":{"x":117,"y":483,"width":761,"height":12}},{"id":"ac750e42-9504-4b05-95f3-2bf47a015128","block_type":"box","text":"a “master/feeder” structure. A Feeder Fund’s investment results will correspond directly to the","page_number":85,"box":{"x":116,"y":498,"width":700,"height":12}},{"id":"649a91ad-864b-4da3-8531-2ac1465f7be6","block_type":"box","text":"investment results of the underlying Master Portfolio in which it invests. For simplicity, this SAI uses the","page_number":85,"box":{"x":117,"y":514,"width":770,"height":12}},{"id":"33120841-c203-4635-8833-f4c5420dd255","block_type":"box","text":"term “Fund” to include both a Feeder Fund and its Master Portfolio.","page_number":85,"box":{"x":116,"y":529,"width":503,"height":10}},{"id":"1a478df8-38ee-4e97-9dec-b4b57814a257","block_type":"box","text":"Certain information contained herein may not be relevant to a particular Fund.","page_number":85,"box":{"x":117,"y":560,"width":582,"height":12}},{"id":"7b22c45a-e02c-4953-b553-1353a3f44115","block_type":"box","text":"Investment Risks and Considerations","page_number":85,"box":{"x":119,"y":610,"width":675,"height":23}},{"id":"1af4b7c3-6d44-4ceb-b71a-985538e4be0f","block_type":"box","text":"Set forth below are descriptions of some of the types of investments and investment strategies that one","page_number":85,"box":{"x":116,"y":661,"width":767,"height":12}},{"id":"c4329d03-7264-4120-8351-865ddeda4b5e","block_type":"box","text":"or more of the Funds may use, and the risks and considerations associated with those investments","page_number":85,"box":{"x":116,"y":677,"width":735,"height":12}},{"id":"c6d5f9e7-764a-464f-be57-21d0e58280be","block_type":"box","text":"and investment strategies. Please see each Fund’s prospectuses (the “Prospectus”) and the","page_number":85,"box":{"x":116,"y":692,"width":685,"height":12}},{"id":"14cfd7a9-4ecd-49d1-b06a-c30ca7921372","block_type":"box","text":"“Investment Objective and Policies,” “Investment Objectives and Policies” or “Investment Strategies","page_number":85,"box":{"x":116,"y":708,"width":737,"height":12}},{"id":"54a3658a-dc82-4fc2-a58e-b59c755a5ea6","block_type":"box","text":"and Risks of the Fund” section, as applicable, of Part I of this SAI for further information on each","page_number":85,"box":{"x":116,"y":723,"width":714,"height":12}},{"id":"5baf9ffa-292d-48d5-850b-3a14226b54b2","block_type":"box","text":"Fund’s investment policies and risks. Information contained in this section about the risks and","page_number":85,"box":{"x":117,"y":739,"width":692,"height":12}},{"id":"83257f82-02b1-44f7-b810-0e1f159751f8","block_type":"box","text":"considerations associated with a Fund’s investments and/or investment strategies applies only to those","page_number":85,"box":{"x":116,"y":754,"width":765,"height":12}},{"id":"daa7cec2-566b-473f-af3a-8803422393e5","block_type":"box","text":"Funds specifically identified in Part I of this SAI as making each type of investment or using each","page_number":85,"box":{"x":117,"y":770,"width":716,"height":12}},{"id":"993660b8-3933-4b79-809e-de42ccf4e1ae","block_type":"box","text":"investment strategy (each, a “Covered Fund”). Information that does not apply to a Covered Fund does","page_number":85,"box":{"x":117,"y":785,"width":764,"height":12}},{"id":"23003153-1317-47ab-a25d-d6e9074fc838","block_type":"box","text":"not form a part of that Covered Fund’s SAI and should not be relied on by investors in that Covered","page_number":85,"box":{"x":117,"y":801,"width":735,"height":12}},{"id":"172b86b9-6fee-4920-b05c-9c0fbd41ee71","block_type":"box","text":"Fund. Only information that is clearly identified as applicable to a Covered Fund is considered to form a","page_number":85,"box":{"x":117,"y":816,"width":765,"height":12}},{"id":"07a11401-68f2-451c-a566-af7cab43bd4d","block_type":"box","text":"part of that Covered Fund’s SAI.","page_number":85,"box":{"x":117,"y":832,"width":244,"height":12}},{"id":"17596126-e22d-4ede-95de-849195768c5d","block_type":"box","text":"Asset-Backed Securities.","page_number":85,"box":{"x":116,"y":862,"width":200,"height":10}},{"id":"e60bca28-7d69-4706-a529-f2f5f2105910","block_type":"box","text":"Asset-backed securities are securities backed by home equity loans,","page_number":85,"box":{"x":317,"y":862,"width":519,"height":12}},{"id":"9a23bd26-16f7-40c0-86f0-2e2ee4825bd7","block_type":"box","text":"installment sale contracts, credit card receivables or other assets. Asset-backed securities are","page_number":85,"box":{"x":117,"y":878,"width":702,"height":11}},{"id":"6583cb63-834d-4661-b284-a3621af2c621","block_type":"box","text":"II-1","page_number":85,"box":{"x":489,"y":909,"width":20,"height":9}},{"id":"dfc0d2ae-6ff9-410f-bd74-c1c940f73084","block_type":"box","text":"NM0926U-5926888-85/257","page_number":85,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"3a9f38e3-4c6d-40e5-971a-2cf14e87d737","block_type":"box","text":"“pass-through” securities, meaning that principal and interest payments — net of expenses — made by","page_number":86,"box":{"x":116,"y":87,"width":770,"height":12}},{"id":"cb491be9-d920-43ab-ab89-40bc94a9ed1b","block_type":"box","text":"the borrower on the underlying assets (such as credit card receivables) are passed through to a Fund.","page_number":86,"box":{"x":116,"y":102,"width":763,"height":13}},{"id":"8ac1d11a-9104-4bd7-b6f9-219651230b74","block_type":"box","text":"The value of asset-backed securities, like that of traditional fixed-income securities, typically increases","page_number":86,"box":{"x":116,"y":118,"width":763,"height":12}},{"id":"591346ab-7c0e-46cf-83a5-9ac91a9b4a26","block_type":"box","text":"when interest rates fall and decreases when interest rates rise. However, asset-backed securities differ","page_number":86,"box":{"x":116,"y":134,"width":770,"height":11}},{"id":"015ec8d8-0d07-458b-9fce-ee55c6458e41","block_type":"box","text":"from traditional fixed-income securities because of their potential for prepayment. The price paid by a","page_number":86,"box":{"x":116,"y":149,"width":755,"height":12}},{"id":"01bb1176-dafa-4558-919a-0d6d6c37f641","block_type":"box","text":"Fund for its asset-backed securities, the yield the Fund expects to receive from such securities and the","page_number":86,"box":{"x":117,"y":165,"width":767,"height":12}},{"id":"bc57058e-99f8-4d93-885b-be78a419df3b","block_type":"box","text":"average life of the securities are based on a number of factors, including the anticipated rate of","page_number":86,"box":{"x":116,"y":180,"width":709,"height":12}},{"id":"c994583e-ca08-4b7e-b67f-614c76b8d4fc","block_type":"box","text":"prepayment of the underlying assets. In a period of declining interest rates, borrowers may prepay the","page_number":86,"box":{"x":117,"y":196,"width":761,"height":12}},{"id":"c1749868-b30f-4ff6-8b93-eaee96181243","block_type":"box","text":"underlying assets more quickly than anticipated, thereby reducing the yield to maturity and the average","page_number":86,"box":{"x":117,"y":211,"width":769,"height":12}},{"id":"9de81983-18ed-4541-b857-76ad4f46cb8c","block_type":"box","text":"life of the asset-backed securities. Moreover, when a Fund reinvests the proceeds of a prepayment in","page_number":86,"box":{"x":117,"y":227,"width":758,"height":12}},{"id":"e837b714-a7e1-46b9-8a2a-13165cc1d23f","block_type":"box","text":"these circumstances, it will likely receive a rate of interest that is lower than the rate on the security that","page_number":86,"box":{"x":116,"y":242,"width":772,"height":12}},{"id":"7eae2cdf-54f7-4507-8c21-a3a059055ebd","block_type":"box","text":"was prepaid. To the extent that a Fund purchases asset-backed securities at a premium, prepayments","page_number":86,"box":{"x":116,"y":258,"width":765,"height":12}},{"id":"eb37e2e9-3631-44cf-9529-9ae8fd2a870f","block_type":"box","text":"may result in a loss to the extent of the premium paid. If a Fund buys such securities at a discount,","page_number":86,"box":{"x":117,"y":273,"width":736,"height":12}},{"id":"051d707a-da8c-464f-8e99-f131e8538881","block_type":"box","text":"both scheduled payments and unscheduled prepayments will increase current and total returns and","page_number":86,"box":{"x":117,"y":289,"width":742,"height":12}},{"id":"7f2b1c7d-e998-46f5-8ab8-0a20c417952c","block_type":"box","text":"unscheduled prepayments will also accelerate the recognition of income which, when distributed to","page_number":86,"box":{"x":117,"y":304,"width":738,"height":12}},{"id":"417bb87c-4f82-45a7-95fe-93d60468bfca","block_type":"box","text":"shareholders, will be taxable as ordinary income. In a period of rising interest rates, prepayments of the","page_number":86,"box":{"x":116,"y":320,"width":772,"height":12}},{"id":"35f07bcc-0f31-42ce-ae86-159d487b9504","block_type":"box","text":"underlying assets may occur at a slower than expected rate, creating maturity extension risk. This","page_number":86,"box":{"x":117,"y":335,"width":730,"height":12}},{"id":"cc5c2ad4-0a80-4665-b882-09e04ab70bf2","block_type":"box","text":"particular risk may effectively change a security that was considered short- or intermediate-term at the","page_number":86,"box":{"x":117,"y":351,"width":762,"height":12}},{"id":"d19e38c2-a757-4c5e-be7f-7e78ea451370","block_type":"box","text":"time of purchase into a longer term security. Since the value of longer-term securities generally","page_number":86,"box":{"x":116,"y":366,"width":710,"height":12}},{"id":"4258364f-cf61-4fc7-8f02-0dc9b0da305b","block_type":"box","text":"fluctuates more widely in response to changes in interest rates than does the value of shorter-term","page_number":86,"box":{"x":116,"y":382,"width":736,"height":12}},{"id":"4091ec7a-2667-49ea-8555-03c912f76051","block_type":"box","text":"securities, maturity extension risk could increase the volatility of the Fund. When interest rates decline,","page_number":86,"box":{"x":116,"y":397,"width":766,"height":12}},{"id":"2abe551d-ca69-4786-9b3e-ba37fd88fa14","block_type":"box","text":"the value of an asset-backed security with prepayment features may not increase as much as that of","page_number":86,"box":{"x":116,"y":413,"width":751,"height":12}},{"id":"cf34828e-c04a-40a5-adb9-766bfea3eb23","block_type":"box","text":"other fixed-income securities, and, as noted above, changes in market rates of interest may accelerate","page_number":86,"box":{"x":116,"y":428,"width":767,"height":12}},{"id":"223f0efe-7d70-49e8-a28e-37dc455a892a","block_type":"box","text":"or retard prepayments and thus affect maturities.","page_number":86,"box":{"x":116,"y":444,"width":368,"height":12}},{"id":"a8f21b06-73f1-4cd1-8eaa-e53d9f94a32d","block_type":"box","text":"Asset-Based Securities.","page_number":86,"box":{"x":116,"y":475,"width":190,"height":9}},{"id":"b504753f-57e2-4971-8031-e5d2419f2a31","block_type":"box","text":"Certain Funds may invest in debt, preferred or convertible securities, the","page_number":86,"box":{"x":307,"y":475,"width":548,"height":12}},{"id":"a6e3d128-e085-449b-a879-432247377c07","block_type":"box","text":"principal amount, redemption terms or conversion terms of which are related to the market price of","page_number":86,"box":{"x":117,"y":490,"width":734,"height":12}},{"id":"2582c190-8c8b-4928-b9ee-cf30eb85bb7a","block_type":"box","text":"some natural resource asset such as gold bullion. These securities are referred to as “asset-based","page_number":86,"box":{"x":116,"y":506,"width":737,"height":12}},{"id":"ab4fc569-b026-40d1-b39e-6b56499b5a68","block_type":"box","text":"securities.” A Fund will purchase only asset-based securities that are rated, or are issued by issuers","page_number":86,"box":{"x":116,"y":521,"width":746,"height":12}},{"id":"7466c861-7bd6-48d0-bba2-c323722a9204","block_type":"box","text":"that have outstanding debt obligations rated, investment grade (for example, AAA, AA, A or BBB by","page_number":86,"box":{"x":116,"y":537,"width":744,"height":12}},{"id":"9b6a5a6b-ee40-48a5-8fd0-b87c765b78ec","block_type":"box","text":"S&P Global Ratings (“S&P”) or Fitch Ratings (“Fitch”), or Baa by Moody’s Investors Service, Inc.","page_number":86,"box":{"x":116,"y":552,"width":719,"height":12}},{"id":"9051cd39-bea8-4368-b840-df19228be4e1","block_type":"box","text":"(“Moody’s”) or commercial paper rated A-1 by S&P or Prime-1 by Moody’s) or by issuers that the","page_number":86,"box":{"x":117,"y":568,"width":721,"height":12}},{"id":"a223165c-8c66-4b37-912e-1422a1618a17","block_type":"box","text":"Manager has determined to be of similar creditworthiness. Obligations ranked in the fourth highest","page_number":86,"box":{"x":117,"y":583,"width":733,"height":12}},{"id":"00111f27-8bcd-4cba-8305-a5516f2cd5f1","block_type":"box","text":"rating category, while considered “investment grade,” may have certain speculative characteristics and","page_number":86,"box":{"x":117,"y":599,"width":766,"height":12}},{"id":"08cc6524-66f7-4e22-8b77-09f52b15f840","block_type":"box","text":"may be more likely to be downgraded than securities rated in the three highest rating categories. If an","page_number":86,"box":{"x":117,"y":614,"width":759,"height":12}},{"id":"567d33bc-1aaa-4e8e-9075-126fa32fb1ff","block_type":"box","text":"asset-based security is backed by a bank letter of credit or other similar facility, the Manager may take","page_number":86,"box":{"x":116,"y":630,"width":764,"height":12}},{"id":"cffe40b3-f7fc-4063-9d66-1c2b38f90290","block_type":"box","text":"such backing into account in determining the creditworthiness of the issuer. While the market prices for","page_number":86,"box":{"x":116,"y":645,"width":769,"height":12}},{"id":"7d0656bb-7195-4be7-ada7-97f1117d2ecd","block_type":"box","text":"an asset-based security and the related natural resource asset generally are expected to move in the","page_number":86,"box":{"x":116,"y":661,"width":751,"height":12}},{"id":"5383d33e-e98b-4629-865d-287d3a0a8250","block_type":"box","text":"same direction, there may not be perfect correlation in the two price movements. Asset-based","page_number":86,"box":{"x":116,"y":676,"width":696,"height":12}},{"id":"b70675dc-a0d7-4fef-964c-bcaad9a1ede3","block_type":"box","text":"securities may not be secured by a security interest in or claim on the underlying natural resource","page_number":86,"box":{"x":116,"y":692,"width":723,"height":12}},{"id":"bae2eaa0-88e7-453f-998c-ee2871712fdf","block_type":"box","text":"asset. The asset-based securities in which a Fund may invest may bear interest or pay preferred","page_number":86,"box":{"x":116,"y":707,"width":716,"height":12}},{"id":"42180419-989d-48a2-9427-036458d4f355","block_type":"box","text":"dividends at below market (or even relatively nominal) rates. Certain asset-based securities may be","page_number":86,"box":{"x":116,"y":723,"width":738,"height":12}},{"id":"7ef68d44-7ea0-475b-a708-acbc54f80622","block_type":"box","text":"payable at maturity in cash at the stated principal amount or, at the option of the holder, directly in a","page_number":86,"box":{"x":117,"y":738,"width":738,"height":12}},{"id":"cab611eb-e999-4b5c-bcd2-d98746fd010c","block_type":"box","text":"stated amount of the asset to which it is related. In such instance, because no Fund presently intends","page_number":86,"box":{"x":116,"y":754,"width":753,"height":12}},{"id":"7b99e9df-4c3e-456c-b358-55765541b101","block_type":"box","text":"to invest directly in natural resource assets, a Fund would sell the asset-based security in the","page_number":86,"box":{"x":116,"y":769,"width":691,"height":12}},{"id":"3ccbdc75-5f82-4892-ab8c-c8f8d762ac57","block_type":"box","text":"secondary market, to the extent one exists, prior to maturity if the value of the stated amount of the","page_number":86,"box":{"x":116,"y":785,"width":733,"height":12}},{"id":"14fa21cf-d952-42ef-b511-e117f5d012ba","block_type":"box","text":"asset exceeds the stated principal amount and thereby realize the appreciation in the underlying asset.","page_number":86,"box":{"x":116,"y":800,"width":763,"height":12}},{"id":"c70edcfe-ed79-4eb9-86ec-da307f923145","block_type":"box","text":"Precious Metal-Related Securities.","page_number":86,"box":{"x":116,"y":831,"width":256,"height":10}},{"id":"0b623652-0883-4fb0-ba07-8461eec85d5b","block_type":"box","text":"A Fund may invest in the equity and other securities of companies","page_number":86,"box":{"x":374,"y":831,"width":500,"height":12}},{"id":"7f0130a0-bb89-47eb-86ef-5a9c99c3b9ce","block_type":"box","text":"that explore for, extract, process or deal in precious metals (","page_number":86,"box":{"x":116,"y":847,"width":447,"height":12}},{"id":"f20edf7f-efa5-4a90-b87f-f78a6472fa66","block_type":"box","text":"e.g.","page_number":86,"box":{"x":564,"y":849,"width":26,"height":10}},{"id":"872d763a-0e33-4b04-ae2a-ec69ceeb71af","block_type":"box","text":", gold, silver and platinum), and in","page_number":86,"box":{"x":593,"y":847,"width":255,"height":12}},{"id":"ecb43940-0d67-4a7b-a8d3-f2c5041f0593","block_type":"box","text":"asset-based securities indexed to the value of such metals. Such securities may be purchased when","page_number":86,"box":{"x":116,"y":862,"width":752,"height":12}},{"id":"8190c77a-5035-41e2-bafc-074a738152f8","block_type":"box","text":"they are believed to be attractively priced in relation to the value of a company’s precious metal-related","page_number":86,"box":{"x":116,"y":878,"width":769,"height":12}},{"id":"8878ea64-c39f-4633-90d9-9d2aa433745d","block_type":"box","text":"II-2","page_number":86,"box":{"x":489,"y":909,"width":22,"height":9}},{"id":"839b997c-e687-4356-bd09-df54cc570440","block_type":"box","text":"NM0926U-5926888-86/257","page_number":86,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"65bc3c0d-8cf9-4910-8368-a753300a7b51","block_type":"box","text":"assets or when the values of precious metals are expected to benefit from inflationary pressure or","page_number":87,"box":{"x":116,"y":87,"width":731,"height":12}},{"id":"1aacef24-2633-4ff9-bbb5-2e733b5414d5","block_type":"box","text":"other economic, political or financial uncertainty or instability. Based on historical experience, during","page_number":87,"box":{"x":116,"y":102,"width":746,"height":13}},{"id":"b4a71e97-191c-49d0-b51c-066dde30cd66","block_type":"box","text":"periods of economic or financial instability the securities of companies involved in precious metals may","page_number":87,"box":{"x":117,"y":118,"width":766,"height":12}},{"id":"10f15adb-ab63-4df3-b2a4-3eb7c77984c5","block_type":"box","text":"be subject to extreme price fluctuations, reflecting the high volatility of precious metal prices during","page_number":87,"box":{"x":117,"y":134,"width":736,"height":12}},{"id":"a3b29d1c-3af5-4c8e-bacc-24949b1d741d","block_type":"box","text":"such periods. In addition, the instability of precious metal prices may result in volatile earnings of","page_number":87,"box":{"x":116,"y":149,"width":721,"height":12}},{"id":"1e9b11dc-9a29-4139-9442-8a9961deffcf","block_type":"box","text":"precious metal-related companies, which may, in turn, adversely affect the financial condition of such","page_number":87,"box":{"x":117,"y":165,"width":754,"height":12}},{"id":"8e06a0a8-85bf-4f4a-b7b1-371e2de38280","block_type":"box","text":"companies. The major producers of gold include the Republic of South Africa, Russia, Canada, the","page_number":87,"box":{"x":116,"y":180,"width":739,"height":12}},{"id":"1278d64f-697d-4a14-bb87-c298ef681e51","block_type":"box","text":"United States, Brazil and Australia. Sales of gold by Russia are largely unpredictable and often relate","page_number":87,"box":{"x":117,"y":196,"width":754,"height":12}},{"id":"6e247327-4a7c-4e5b-bc58-e5215d34163f","block_type":"box","text":"to political and economic considerations rather than to market forces. Economic, financial, social and","page_number":87,"box":{"x":116,"y":211,"width":753,"height":12}},{"id":"3c4b45df-da41-4d55-83c6-86c78acf6de1","block_type":"box","text":"political factors within South Africa may significantly affect South African gold production.","page_number":87,"box":{"x":117,"y":227,"width":663,"height":12}},{"id":"83c15cab-7054-4646-8def-749039017958","block_type":"box","text":"Borrowing and Leverage.","page_number":87,"box":{"x":116,"y":258,"width":201,"height":12}},{"id":"6fd9d2d2-aa47-4d8b-bb1d-cfc1de65ca51","block_type":"box","text":"Each Fund may borrow as a temporary measure for extraordinary or","page_number":87,"box":{"x":318,"y":258,"width":517,"height":12}},{"id":"014c08f9-6dca-4698-ab4f-57e2180591e8","block_type":"box","text":"emergency purposes, including to meet redemptions or to settle securities transactions. Certain Funds","page_number":87,"box":{"x":116,"y":273,"width":765,"height":12}},{"id":"8a23e3f5-0d1d-4ec3-b9a5-a9abf17227db","block_type":"box","text":"will not purchase securities at any time when borrowings exceed 5% of their total assets, except (a) to","page_number":87,"box":{"x":116,"y":289,"width":761,"height":12}},{"id":"a6fecccc-9443-46fe-b8b2-4121bccc1f50","block_type":"box","text":"honor prior commitments or (b) to exercise subscription rights when outstanding borrowings have been","page_number":87,"box":{"x":117,"y":304,"width":768,"height":12}},{"id":"19c8097e-0aee-4f8d-93c4-a65079387bee","block_type":"box","text":"obtained exclusively for settlements of other securities transactions.","page_number":87,"box":{"x":116,"y":320,"width":508,"height":12}},{"id":"608f984b-223c-451f-9137-4c8361278570","block_type":"box","text":"Certain Funds may also borrow in order to make investments, to the extent disclosed in such Fund’s","page_number":87,"box":{"x":117,"y":351,"width":748,"height":12}},{"id":"7e95bf7a-b971-472a-b122-9518603b669a","block_type":"box","text":"Prospectus. The purchase of securities while borrowings are outstanding will have the effect of","page_number":87,"box":{"x":117,"y":366,"width":707,"height":12}},{"id":"52b50364-040f-4ee3-b97b-08f63aeba94a","block_type":"box","text":"leveraging the Fund. Such leveraging increases the Fund’s exposure to capital risk, and borrowed","page_number":87,"box":{"x":117,"y":382,"width":731,"height":12}},{"id":"8114e38e-4adc-41d1-84e7-f6fa2a7a23f5","block_type":"box","text":"funds are subject to interest costs that will reduce net income. The use of leverage by a Fund creates","page_number":87,"box":{"x":116,"y":397,"width":757,"height":12}},{"id":"4fbfc626-d4c8-418b-80c1-fbdeda1f7c6d","block_type":"box","text":"an opportunity for greater total return, but, at the same time, creates special risks. For example,","page_number":87,"box":{"x":116,"y":413,"width":714,"height":12}},{"id":"fbc6da89-9fa8-4dcb-880b-b09b867cdf1d","block_type":"box","text":"leveraging may exaggerate changes in the net asset value (“NAV”) of Fund shares and in the yield on","page_number":87,"box":{"x":117,"y":428,"width":758,"height":12}},{"id":"d5a26480-00a8-4d03-b9c5-90764acc5957","block_type":"box","text":"the Fund’s portfolio. Although the principal of such borrowings will be fixed, the Fund’s assets may","page_number":87,"box":{"x":116,"y":444,"width":734,"height":12}},{"id":"7cd60123-1247-4a3a-8f70-f21fdbddc80f","block_type":"box","text":"change in value during the time the borrowings are outstanding. Borrowings will create interest","page_number":87,"box":{"x":116,"y":459,"width":707,"height":12}},{"id":"a5f75c32-b7d3-4f70-b665-6694931a4844","block_type":"box","text":"expenses for the Fund that can exceed the income from the assets purchased with the borrowings. To","page_number":87,"box":{"x":116,"y":475,"width":764,"height":12}},{"id":"44cca406-ab0e-45bb-b0aa-a8e0ec334b6b","block_type":"box","text":"the extent the income or capital appreciation derived from securities purchased with borrowed funds","page_number":87,"box":{"x":116,"y":490,"width":747,"height":12}},{"id":"24396e69-8f26-4789-a54e-7149697831f7","block_type":"box","text":"exceeds the interest the Fund will have to pay on the borrowings, the Fund’s return will be greater than","page_number":87,"box":{"x":116,"y":506,"width":768,"height":12}},{"id":"012160e8-a8ad-400b-a1e8-9700d9fb8bef","block_type":"box","text":"if leverage had not been used. Conversely, if the income or capital appreciation from the securities","page_number":87,"box":{"x":117,"y":521,"width":735,"height":12}},{"id":"a2cb8165-6dec-4053-9255-eaf74e8d5504","block_type":"box","text":"purchased with such borrowed funds is not sufficient to cover the cost of borrowing, the return to the","page_number":87,"box":{"x":117,"y":537,"width":748,"height":12}},{"id":"04ac76bc-cd37-41ab-a0e6-86255b803353","block_type":"box","text":"Fund will be less than if leverage had not been used and, therefore, the amount available for","page_number":87,"box":{"x":117,"y":552,"width":690,"height":12}},{"id":"43abd2e4-7bfa-4218-b2a1-5bb18747d507","block_type":"box","text":"distribution to shareholders as dividends will be reduced. In the latter case, the Manager in its best","page_number":87,"box":{"x":116,"y":568,"width":735,"height":12}},{"id":"95119e3f-83a8-4d3a-ada1-333fb2426413","block_type":"box","text":"judgment nevertheless may determine to maintain the Fund’s leveraged position if it expects that the","page_number":87,"box":{"x":115,"y":583,"width":752,"height":12}},{"id":"10bf1844-a021-47f1-a44c-46765ef1692f","block_type":"box","text":"benefits to the Fund’s shareholders of maintaining the leveraged position will outweigh the current","page_number":87,"box":{"x":117,"y":599,"width":730,"height":12}},{"id":"19eb929d-c065-483a-aba9-2910ff521f53","block_type":"box","text":"reduced return.","page_number":87,"box":{"x":117,"y":614,"width":117,"height":10}},{"id":"7cf0ac54-2173-4ed4-b994-3ba3a46aa829","block_type":"box","text":"Certain types of borrowings by a Fund may result in the Fund being subject to covenants in credit","page_number":87,"box":{"x":117,"y":645,"width":727,"height":12}},{"id":"100c25df-434c-4056-90c5-823411ee6630","block_type":"box","text":"agreements relating to asset coverage, portfolio composition requirements and other matters. It is not","page_number":87,"box":{"x":116,"y":661,"width":753,"height":12}},{"id":"2e6be897-5762-4b9e-9944-f6c705030f2f","block_type":"box","text":"anticipated that observance of such covenants would impede the Manager from managing a Fund’s","page_number":87,"box":{"x":116,"y":676,"width":739,"height":12}},{"id":"faed82f4-0e02-466e-989a-c8e035d8d06e","block_type":"box","text":"portfolio in accordance with the Fund’s investment objectives and policies. However, a breach of any","page_number":87,"box":{"x":117,"y":692,"width":746,"height":12}},{"id":"a94606c0-085e-4cc1-b4cc-b3c81b87e1ff","block_type":"box","text":"such covenants not cured within the specified cure period may result in acceleration of outstanding","page_number":87,"box":{"x":116,"y":707,"width":732,"height":12}},{"id":"0a3fc18b-e693-4d5d-8f8e-24cf71ca442d","block_type":"box","text":"indebtedness and require the Fund to dispose of portfolio investments at a time when it may be","page_number":87,"box":{"x":117,"y":723,"width":706,"height":12}},{"id":"49a4fde8-843d-43bb-a350-1a1751585059","block_type":"box","text":"disadvantageous to do so.","page_number":87,"box":{"x":116,"y":738,"width":195,"height":12}},{"id":"7e976719-f679-464f-86e9-072bc0c2f2bb","block_type":"box","text":"Each Fund may at times borrow from affiliates of the Manager, provided that the terms of such","page_number":87,"box":{"x":117,"y":769,"width":699,"height":12}},{"id":"da67e54d-318c-44bf-8466-ee92f083fe11","block_type":"box","text":"borrowings are no less favorable than those available from comparable sources of funds in the","page_number":87,"box":{"x":117,"y":785,"width":701,"height":12}},{"id":"caa4f4b8-246b-431b-a9d5-16e3958d31b3","block_type":"box","text":"marketplace.","page_number":87,"box":{"x":117,"y":800,"width":94,"height":12}},{"id":"9d828951-153e-4ff7-8bd5-cffe3ec0e66c","block_type":"box","text":"Cash Management.","page_number":87,"box":{"x":117,"y":831,"width":151,"height":12}},{"id":"5a37ad74-2eed-4e25-be34-cc3bf5fd28f5","block_type":"box","text":"Generally, the Manager will employ futures and options on futures to provide","page_number":87,"box":{"x":269,"y":831,"width":578,"height":12}},{"id":"c5ff782c-82f9-4bbd-9052-18e1fe65f41a","block_type":"box","text":"liquidity necessary to meet anticipated redemptions or for day-to-day operating purposes. However, if","page_number":87,"box":{"x":117,"y":847,"width":756,"height":12}},{"id":"faac85a1-f369-4776-963c-6156a0e7568a","block_type":"box","text":"considered appropriate in the opinion of the Manager, a portion of a Fund’s assets may be invested in","page_number":87,"box":{"x":116,"y":862,"width":760,"height":12}},{"id":"1e9fda9a-62c7-4196-ba9a-18a45030394a","block_type":"box","text":"certain types of instruments with remaining maturities of 397 days or less for liquidity purposes. Such","page_number":87,"box":{"x":116,"y":878,"width":754,"height":12}},{"id":"b3b8e2f8-692f-49a2-940a-7549e126573f","block_type":"box","text":"II-3","page_number":87,"box":{"x":489,"y":909,"width":22,"height":9}},{"id":"3794679e-5e95-4413-a868-4838770b6399","block_type":"box","text":"NM0926U-5926888-87/257","page_number":87,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"9d6a0beb-5ff0-4ad4-aa0c-97ca2979c221","block_type":"box","text":"instruments would consist of: (i) obligations of the U.S. Government, its agencies, instrumentalities,","page_number":88,"box":{"x":117,"y":87,"width":740,"height":12}},{"id":"3ccebf04-8b14-4641-8e66-f32a707a01cc","block_type":"box","text":"authorities or political subdivisions (“U.S. Government Securities”); (ii) other fixed-income securities","page_number":88,"box":{"x":116,"y":102,"width":742,"height":13}},{"id":"c0e9ee08-275d-4076-b7af-66e2842af0d8","block_type":"box","text":"rated Aa or higher by Moody’s or AA or higher by S&P or, if unrated, of comparable quality in the","page_number":88,"box":{"x":117,"y":118,"width":721,"height":12}},{"id":"e0887c31-313e-44cb-b0e5-727c017da426","block_type":"box","text":"opinion of the Manager; (iii) commercial paper; (iv) bank obligations, including negotiable certificates of","page_number":88,"box":{"x":116,"y":134,"width":768,"height":12}},{"id":"5c9d0148-ba0a-4408-beda-c4235e75210e","block_type":"box","text":"deposit, time deposits and bankers’ acceptances; and (v) repurchase agreements. At the time the","page_number":88,"box":{"x":116,"y":149,"width":730,"height":12}},{"id":"1292c8ae-5fae-4818-a673-695c02a6cfc3","block_type":"box","text":"Fund invests in commercial paper, bank obligations or repurchase agreements, the issuer or the","page_number":88,"box":{"x":117,"y":165,"width":718,"height":12}},{"id":"5b8a6afe-260e-42a2-85a0-54018dbece72","block_type":"box","text":"issuer’s parent must have outstanding debt rated Aa or higher by Moody’s or AA or higher by S&P or","page_number":88,"box":{"x":117,"y":180,"width":752,"height":12}},{"id":"52131f4d-68ef-4a3b-8453-6f7c830f3712","block_type":"box","text":"outstanding commercial paper, bank obligations or other short-term obligations rated Prime-1 by","page_number":88,"box":{"x":116,"y":196,"width":719,"height":12}},{"id":"74e275fb-7f40-4a87-b1f3-e77b328d0eaa","block_type":"box","text":"Moody’s or A-1 by S&P; or, if no such ratings are available, the instrument must be of comparable","page_number":88,"box":{"x":117,"y":211,"width":731,"height":12}},{"id":"ccc241d9-3cd4-4641-8ef8-e2e23c7b30ec","block_type":"box","text":"quality in the opinion of the Manager. For more information on money market instruments, see “Money","page_number":88,"box":{"x":116,"y":227,"width":765,"height":12}},{"id":"460ca70a-adc7-44c0-ad9a-e49ac5abb051","block_type":"box","text":"Market Securities” below.","page_number":88,"box":{"x":117,"y":242,"width":192,"height":10}},{"id":"a6f34026-45b7-49b6-ae7f-8f3298d30399","block_type":"box","text":"Collateralized Debt Obligations.","page_number":88,"box":{"x":117,"y":273,"width":251,"height":12}},{"id":"42f9433a-c11a-4f32-ac2c-76fca7c20efa","block_type":"box","text":"Certain Funds may invest in collateralized debt obligations","page_number":88,"box":{"x":369,"y":273,"width":444,"height":12}},{"id":"5e858fe6-886d-4a77-ade7-ab69662d1cc8","block_type":"box","text":"(“CDOs”), which include collateralized bond obligations (“CBOs”), collateralized loan obligations","page_number":88,"box":{"x":117,"y":289,"width":713,"height":12}},{"id":"f987e447-4fc2-479f-9091-eb1116ba390b","block_type":"box","text":"(“CLOs”) and other similarly structured securities. CDOs are types of asset-backed securities. A CBO","page_number":88,"box":{"x":117,"y":304,"width":756,"height":12}},{"id":"67af35a6-d8cc-4d8a-8148-953d63474b56","block_type":"box","text":"is ordinarily issued by a trust or other special purpose entity (“SPE”) and is typically backed by a","page_number":88,"box":{"x":117,"y":320,"width":716,"height":12}},{"id":"cf7506cd-377e-4bcd-8272-709c443146f3","block_type":"box","text":"diversified pool of fixed-income securities (which may include high risk, below investment grade","page_number":88,"box":{"x":116,"y":335,"width":713,"height":12}},{"id":"112cce55-9ad4-4814-b4f9-111841f400ae","block_type":"box","text":"securities) held by such issuer. A CLO is ordinarily issued by a trust or other SPE and is typically","page_number":88,"box":{"x":116,"y":351,"width":722,"height":12}},{"id":"ac329d11-eb43-4ca2-ab69-2a45a347f405","block_type":"box","text":"collateralized by a pool of loans, which may include, among others, domestic and non-U.S. senior","page_number":88,"box":{"x":116,"y":366,"width":729,"height":12}},{"id":"9f194ff7-caa5-4655-9aef-e97d32dd158d","block_type":"box","text":"secured loans, senior unsecured loans, and subordinate corporate loans, including loans that may be","page_number":88,"box":{"x":116,"y":382,"width":756,"height":12}},{"id":"31942916-3dc6-4db7-a5f1-92cf2ec5931c","block_type":"box","text":"rated below investment grade or equivalent unrated loans, held by such issuer. Investments in a CLO","page_number":88,"box":{"x":117,"y":397,"width":757,"height":12}},{"id":"a9015c9a-4779-4fe3-b1df-ed31d0125e06","block_type":"box","text":"organized outside of the United States may not be deemed to be foreign securities if the CLO is","page_number":88,"box":{"x":116,"y":413,"width":715,"height":12}},{"id":"e93cc261-ef74-4f3a-ab23-ed2826d16735","block_type":"box","text":"collateralized by a pool of loans, a substantial portion of which are U.S. loans. Although certain CDOs","page_number":88,"box":{"x":116,"y":428,"width":758,"height":12}},{"id":"eecbee3c-6a0e-4ea1-8856-547c98288d77","block_type":"box","text":"may benefit from credit enhancement in the form of a senior-subordinate structure, over","page_number":88,"box":{"x":117,"y":444,"width":655,"height":12}},{"id":"90290fbb-401a-49ce-ba40-32e554571b7f","block_type":"box","text":"collateralization or bond insurance, such enhancement may not always be present, and may fail to","page_number":88,"box":{"x":116,"y":459,"width":735,"height":12}},{"id":"8ab91ac6-ac6d-490c-b92c-6c1a62cd5b92","block_type":"box","text":"protect a Fund against the risk of loss on default of the collateral. Certain CDO issuers may use","page_number":88,"box":{"x":117,"y":475,"width":713,"height":12}},{"id":"ddee3cd4-5a50-4492-a837-cf01db7b3d3b","block_type":"box","text":"derivatives contracts to create “synthetic” exposure to assets rather than holding such assets directly,","page_number":88,"box":{"x":116,"y":490,"width":758,"height":12}},{"id":"7034f0f1-6f6f-4b92-b9e1-34d0fd3db3f9","block_type":"box","text":"which entails the risks of derivative instruments described elsewhere in this SAI. CDOs may charge","page_number":88,"box":{"x":116,"y":506,"width":742,"height":12}},{"id":"1d46b0dc-3181-43d2-9b7f-802212941ccd","block_type":"box","text":"management fees and administrative expenses, which are in addition to those of a Fund.","page_number":88,"box":{"x":117,"y":521,"width":664,"height":12}},{"id":"7c00a38f-c64e-4557-9f4c-38c7bc5c49b7","block_type":"box","text":"For both CBOs and CLOs, the cash flows from the SPE are split into two or more portions, called","page_number":88,"box":{"x":117,"y":552,"width":724,"height":12}},{"id":"a3712cfd-5608-4b51-ab3f-340617c0fd41","block_type":"box","text":"tranches, varying in risk and yield. The riskiest portion is the “equity” tranche, which bears the first loss","page_number":88,"box":{"x":116,"y":568,"width":765,"height":12}},{"id":"aa0eddf9-519e-49e1-b36b-52f0eb1a2e23","block_type":"box","text":"from defaults from the bonds or loans in the SPE and serves to protect the other, more senior tranches","page_number":88,"box":{"x":116,"y":583,"width":768,"height":12}},{"id":"9f3e871e-512d-4ce0-863d-b844ead28157","block_type":"box","text":"from default (though such protection is not complete). Since it is partially protected from defaults, a","page_number":88,"box":{"x":116,"y":599,"width":737,"height":12}},{"id":"4fd8901b-cdfa-4242-8ad2-1953b7e1f54f","block_type":"box","text":"senior tranche from a CBO or CLO typically has higher ratings and lower yields than its underlying","page_number":88,"box":{"x":116,"y":614,"width":733,"height":12}},{"id":"7d4f29d7-7605-403e-9e16-2007c9ae4f2d","block_type":"box","text":"securities, and may be rated investment grade. Despite the protection from the equity tranche, CBO or","page_number":88,"box":{"x":116,"y":630,"width":765,"height":12}},{"id":"c4b8365f-2cf3-43a8-8f5b-2af4d829dc51","block_type":"box","text":"CLO tranches can experience substantial losses due to actual defaults, downgrades of the underlying","page_number":88,"box":{"x":117,"y":645,"width":758,"height":12}},{"id":"d08a9911-4546-4212-a1c0-aff8de0dd656","block_type":"box","text":"collateral by rating agencies, forced liquidation of the collateral pool due to a failure of coverage tests,","page_number":88,"box":{"x":116,"y":661,"width":752,"height":12}},{"id":"ea933e30-8514-482d-bed0-52484fea2b22","block_type":"box","text":"increased sensitivity to defaults due to collateral default and disappearance of protecting tranches,","page_number":88,"box":{"x":117,"y":676,"width":728,"height":12}},{"id":"74a85b2b-a19f-402c-9717-27a8b64df6ba","block_type":"box","text":"market anticipation of defaults as well as investor aversion to CBO or CLO securities as a class.","page_number":88,"box":{"x":117,"y":692,"width":710,"height":12}},{"id":"29106762-9c94-4e39-a069-ef6e7e15784e","block_type":"box","text":"Interest on certain tranches of a CDO may be paid in kind or deferred and capitalized (paid in the form","page_number":88,"box":{"x":117,"y":707,"width":757,"height":12}},{"id":"fcb9a384-b7f0-4a71-94ca-8f222567cedb","block_type":"box","text":"of obligations of the same type rather than cash), which involves continued exposure to default risk","page_number":88,"box":{"x":116,"y":723,"width":734,"height":12}},{"id":"832a10fe-d91a-49ff-80e9-47a72f49b257","block_type":"box","text":"with respect to such payments.","page_number":88,"box":{"x":116,"y":738,"width":229,"height":12}},{"id":"2cdfed39-fadf-4d3c-acbf-5464667e1e70","block_type":"box","text":"The risks of an investment in a CDO depend largely on the type of the collateral securities and the","page_number":88,"box":{"x":116,"y":769,"width":728,"height":12}},{"id":"8dd019dd-f4b9-46d6-b128-44904d1a1149","block_type":"box","text":"class of the CDO in which a Fund invests. Normally, CBOs, CLOs and other CDOs are privately","page_number":88,"box":{"x":116,"y":785,"width":712,"height":12}},{"id":"27bc7ff9-7f22-43b9-9413-b5351f4e62b6","block_type":"box","text":"offered and sold, and thus are not registered under the securities laws. However, an active dealer","page_number":88,"box":{"x":116,"y":800,"width":725,"height":12}},{"id":"259f029b-ab14-474d-b7be-cbefb48330f2","block_type":"box","text":"market may exist for CDOs, allowing a CDO to qualify for Rule 144A transactions. In addition to the","page_number":88,"box":{"x":117,"y":816,"width":736,"height":12}},{"id":"b7a5935b-1e1d-4119-a0e5-b1276da5ed72","block_type":"box","text":"normal risks associated with fixed-income securities and asset-backed securities generally discussed","page_number":88,"box":{"x":117,"y":831,"width":755,"height":12}},{"id":"677bdc7a-17f3-44e4-85bc-c2aac0c0d7f0","block_type":"box","text":"elsewhere in this SAI, CDOs carry additional risks including, but not limited to: (i) the possibility that","page_number":88,"box":{"x":116,"y":847,"width":742,"height":12}},{"id":"7dfdfe4f-c9f0-481d-909d-3be4ac0914a7","block_type":"box","text":"distributions from collateral securities will not be adequate to make interest or other payments; (ii) the","page_number":88,"box":{"x":116,"y":862,"width":756,"height":12}},{"id":"790f20ce-285c-4bd9-989e-9673233b25ba","block_type":"box","text":"risk that the collateral may default or decline in value or be downgraded, if rated by a nationally","page_number":88,"box":{"x":117,"y":878,"width":708,"height":12}},{"id":"e6ff3b6d-22f5-4952-b41c-3e612e202c78","block_type":"box","text":"II-4","page_number":88,"box":{"x":489,"y":909,"width":22,"height":9}},{"id":"ce37cabe-3555-463b-bbd8-e0e57fb92a3a","block_type":"box","text":"NM0926U-5926888-88/257","page_number":88,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"b2e96a1f-21d8-475b-a46d-f8ce74b935ce","block_type":"box","text":"recognized statistical rating organization (“NRSRO”); (iii) a Fund may invest in tranches of CDOs that","page_number":89,"box":{"x":117,"y":87,"width":754,"height":12}},{"id":"9056d902-b862-47f6-acc3-2387a48bd813","block_type":"box","text":"are subordinate to other tranches; (iv) the structure and complexity of the transaction and the legal","page_number":89,"box":{"x":116,"y":102,"width":736,"height":13}},{"id":"48a421de-72bc-402c-805a-1fdcf2fd41b8","block_type":"box","text":"documents could lead to disputes among investors regarding the characterization of proceeds; (v) the","page_number":89,"box":{"x":116,"y":118,"width":760,"height":12}},{"id":"e63e5565-e714-469f-8d3e-93319c1eb7b5","block_type":"box","text":"investment return achieved by the Fund could be significantly different than those predicted by financial","page_number":89,"box":{"x":117,"y":134,"width":771,"height":12}},{"id":"25c9f695-003f-4f14-8aeb-3d57de39bb07","block_type":"box","text":"models; (vi) the lack of a readily available secondary market for CDOs; (vii) the risk of forced “fire sale”","page_number":89,"box":{"x":117,"y":149,"width":765,"height":12}},{"id":"a1d3dca0-eaef-4424-bf85-e82b4ce26044","block_type":"box","text":"liquidation due to technical defaults such as coverage test failures; and (viii) the CDO’s manager may","page_number":89,"box":{"x":117,"y":165,"width":756,"height":12}},{"id":"28e67878-d2d1-402f-906e-a73dfaa8f9d8","block_type":"box","text":"perform poorly.","page_number":89,"box":{"x":117,"y":180,"width":117,"height":12}},{"id":"0ddbbc29-570a-44f1-bfa0-a51531ecf745","block_type":"box","text":"Commercial Paper.","page_number":89,"box":{"x":117,"y":211,"width":150,"height":12}},{"id":"77d7d7ab-51c7-4229-91e4-ca7ecf940804","block_type":"box","text":"Certain Funds may purchase commercial paper. Commercial paper purchasable","page_number":89,"box":{"x":268,"y":211,"width":607,"height":12}},{"id":"d6155bdd-17b4-4cca-b646-0d114e8adbc6","block_type":"box","text":"by each Fund includes “Section 4(a)(2) paper,” a term that includes debt obligations issued in reliance","page_number":89,"box":{"x":117,"y":227,"width":760,"height":12}},{"id":"1c1a2675-2b82-4e99-890c-4b7f00f6d58d","block_type":"box","text":"on the “private placement” exemption from registration afforded by Section 4(a)(2) of the Securities","page_number":89,"box":{"x":116,"y":242,"width":739,"height":12}},{"id":"4e278d8e-5484-4afb-9cc0-46dad459e815","block_type":"box","text":"Act. Section 4(a)(2) paper is restricted as to disposition under the Federal securities laws, and is","page_number":89,"box":{"x":116,"y":258,"width":719,"height":12}},{"id":"a7ccca3f-de05-4a88-9476-686970293578","block_type":"box","text":"frequently sold (and resold) to institutional investors such as the Fund through or with the assistance of","page_number":89,"box":{"x":116,"y":273,"width":769,"height":12}},{"id":"c65a1b34-6e2d-4566-a0f9-47321231eb95","block_type":"box","text":"investment dealers who make a market in the Section 4(a)(2) paper, thereby providing liquidity. Certain","page_number":89,"box":{"x":117,"y":289,"width":769,"height":12}},{"id":"5b4aea81-8c65-4782-9c18-ffc8a3b80f91","block_type":"box","text":"transactions in Section 4(a)(2) paper may qualify for the registration exemption provided in Rule 144A","page_number":89,"box":{"x":116,"y":304,"width":759,"height":12}},{"id":"105f1e43-2eae-4382-9e03-dac8e79551f2","block_type":"box","text":"under the Securities Act. Most Funds can purchase commercial paper rated (at the time of purchase)","page_number":89,"box":{"x":117,"y":320,"width":754,"height":12}},{"id":"b239f37c-064b-47f7-a557-2c562d4e08b8","block_type":"box","text":"“A-1” by S&P or “Prime-1” by Moody’s or when deemed advisable by a Fund’s Manager or sub-adviser,","page_number":89,"box":{"x":116,"y":335,"width":772,"height":12}},{"id":"99dfd08b-6c5f-45c4-a352-ef1d8b98e444","block_type":"box","text":"“high quality” issues rated “A-2”, “Prime-2” or “F-2” by S&P, Moody’s or Fitch, respectively.","page_number":89,"box":{"x":116,"y":351,"width":675,"height":12}},{"id":"67b3dff1-0a3c-41ce-acea-28d3d2b977f5","block_type":"box","text":"Commercial paper is generally considered to be short-term unsecured debt of corporations. Like all","page_number":89,"box":{"x":117,"y":382,"width":740,"height":12}},{"id":"539b72a2-e745-47d7-a101-1a33a286aaf6","block_type":"box","text":"fixed income securities, commercial paper prices are susceptible to fluctuations in interest rates. If","page_number":89,"box":{"x":116,"y":397,"width":732,"height":12}},{"id":"7b6ce792-ec35-46ae-a07b-b003187ac474","block_type":"box","text":"interest rates rise, commercial paper prices will decline and vice versa. However, the short-term nature","page_number":89,"box":{"x":117,"y":413,"width":767,"height":12}},{"id":"d1e12f50-0040-4bfd-8c65-16e1eff138c3","block_type":"box","text":"of a commercial paper investment generally makes it less susceptible to volatility than many other fixed","page_number":89,"box":{"x":116,"y":428,"width":771,"height":12}},{"id":"43bcbaa8-93a2-4c28-9a35-dfab0e7320bb","block_type":"box","text":"income securities because interest rate risk typically increases as maturity lengths increase.","page_number":89,"box":{"x":117,"y":444,"width":686,"height":12}},{"id":"8ad90a8b-0854-492b-b75f-639ee9125472","block_type":"box","text":"Commercial paper tends to yield smaller returns than longer-term corporate debt because securities","page_number":89,"box":{"x":117,"y":459,"width":746,"height":12}},{"id":"58db9bc4-4850-4177-b025-12e644e66309","block_type":"box","text":"with shorter maturities typically have lower effective yields than those with longer maturities.","page_number":89,"box":{"x":116,"y":475,"width":686,"height":12}},{"id":"1d7ea347-6402-42df-aa74-1acf8bd45876","block_type":"box","text":"Commodity-Linked Derivative Instruments and Hybrid Instruments.","page_number":89,"box":{"x":117,"y":506,"width":535,"height":12}},{"id":"9a0b2cf4-dfbe-430f-8834-7252e4429614","block_type":"box","text":"Certain Funds seek to gain","page_number":89,"box":{"x":653,"y":506,"width":210,"height":12}},{"id":"3425e9c9-1c15-4a60-9e94-858f8bf90417","block_type":"box","text":"exposure to the commodities markets primarily through investments in hybrid instruments. Hybrid","page_number":89,"box":{"x":116,"y":521,"width":727,"height":12}},{"id":"53dac6e0-2365-4da2-bd4c-e60c326f905c","block_type":"box","text":"instruments are either equity or debt derivative securities with one or more commodity-dependent","page_number":89,"box":{"x":117,"y":537,"width":727,"height":12}},{"id":"f81543a6-9e3b-436d-bddc-118a24ae1435","block_type":"box","text":"components that have payment features similar to a commodity futures contract, a commodity option","page_number":89,"box":{"x":116,"y":552,"width":753,"height":12}},{"id":"40a71774-dc8f-4fb0-b9b0-1cf2741f6ed5","block_type":"box","text":"contract, or a combination of both. Therefore, these instruments are “commodity-linked.” They are","page_number":89,"box":{"x":116,"y":568,"width":731,"height":12}},{"id":"04dbdf10-edd8-48a2-b36c-800b0ba32841","block_type":"box","text":"considered “hybrid” instruments because they have both commodity-like and security-like","page_number":89,"box":{"x":116,"y":583,"width":667,"height":12}},{"id":"23559a1e-919c-48c6-92cf-6f8bbdc7508b","block_type":"box","text":"characteristics. Hybrid instruments are derivative instruments because at least part of their value is","page_number":89,"box":{"x":116,"y":599,"width":738,"height":12}},{"id":"2dd5f2ac-0c55-42d9-bf2f-5ab48459db50","block_type":"box","text":"derived from the value of an underlying commodity, futures contract, index or other readily measurable","page_number":89,"box":{"x":116,"y":614,"width":766,"height":12}},{"id":"f0d840cf-eab5-47c2-8d29-e2cc636f1e38","block_type":"box","text":"economic variable.","page_number":89,"box":{"x":116,"y":630,"width":145,"height":9}},{"id":"52ef8730-aad4-4456-a5a8-4a2f283bcfd5","block_type":"box","text":"The prices of commodity-linked derivative instruments may move in different directions than","page_number":89,"box":{"x":116,"y":661,"width":680,"height":12}},{"id":"1e282773-8298-43ec-999c-1e5f66b1533f","block_type":"box","text":"investments in traditional equity and debt securities when the value of those traditional securities is","page_number":89,"box":{"x":117,"y":676,"width":731,"height":12}},{"id":"3a7cf5f2-af9f-47d7-ac6a-5c5ec6c9e93d","block_type":"box","text":"declining due to adverse economic conditions. As an example, during periods of rising inflation, debt","page_number":89,"box":{"x":116,"y":692,"width":744,"height":12}},{"id":"bb24ae3d-957a-4215-94a0-8058d67368ef","block_type":"box","text":"securities have historically tended to decline in value due to the general increase in prevailing interest","page_number":89,"box":{"x":116,"y":707,"width":753,"height":12}},{"id":"41af1d6c-5391-4218-ac31-49982b25c3a4","block_type":"box","text":"rates. Conversely, during those same periods of rising inflation, the prices of certain commodities, such","page_number":89,"box":{"x":117,"y":723,"width":763,"height":12}},{"id":"d84cb874-4db9-42a0-adfa-70d23fe7dd26","block_type":"box","text":"as oil and metals, have historically tended to increase. Of course, there cannot be any guarantee that","page_number":89,"box":{"x":116,"y":738,"width":752,"height":12}},{"id":"f90579f0-fc0a-486d-b2c2-0336b58fc0d0","block_type":"box","text":"these investments will perform in that manner in the future, and at certain times the price movements","page_number":89,"box":{"x":116,"y":754,"width":749,"height":12}},{"id":"3f5bd0fb-5d71-4894-ae92-ac3e8a085a91","block_type":"box","text":"of commodity-linked instruments have been parallel to those of debt and equity securities.","page_number":89,"box":{"x":116,"y":769,"width":665,"height":12}},{"id":"4537b2e9-a799-4d94-9f19-102e29b95330","block_type":"box","text":"Commodities have historically tended to increase and decrease in value during different parts of the","page_number":89,"box":{"x":117,"y":785,"width":739,"height":12}},{"id":"f291a7ef-1e00-4ff1-966e-b54df0c08c00","block_type":"box","text":"business cycle than financial assets. Nevertheless, at various times, commodities prices may move in","page_number":89,"box":{"x":117,"y":800,"width":753,"height":12}},{"id":"bf86e44d-0aaa-4ac7-8f7a-39023a677140","block_type":"box","text":"tandem with the prices of financial assets and thus may not provide overall portfolio diversification","page_number":89,"box":{"x":116,"y":816,"width":725,"height":12}},{"id":"241a7a33-9128-4a54-9d4b-b89d064ed7b1","block_type":"box","text":"benefits. Under favorable economic conditions, the Fund’s investments may be expected to under","page_number":89,"box":{"x":117,"y":831,"width":731,"height":12}},{"id":"774c5a85-bc37-441d-bc4d-8b6bea159a07","block_type":"box","text":"perform an investment in traditional securities. Over the long term, the returns on the Fund’s","page_number":89,"box":{"x":117,"y":847,"width":688,"height":12}},{"id":"fbcc7ed8-3c3e-47c6-9411-d23cd3622409","block_type":"box","text":"investments are expected to exhibit low or negative correlation with stocks and bonds.","page_number":89,"box":{"x":117,"y":862,"width":643,"height":12}},{"id":"cdf4c730-13a5-4662-95d4-d0fb803159db","block_type":"box","text":"II-5","page_number":89,"box":{"x":489,"y":909,"width":22,"height":9}},{"id":"2e21869d-beb5-4f1f-bdfc-d5c0a772d8f0","block_type":"box","text":"NM0926U-5926888-89/257","page_number":89,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"ff4325aa-6e31-4a93-9574-4342336cd77f","block_type":"box","text":"Qualifying Hybrid Instruments.","page_number":90,"box":{"x":117,"y":87,"width":218,"height":12}},{"id":"82538b1d-6b68-47d6-a5e0-ec665f0fce7f","block_type":"box","text":"Certain Funds may invest in hybrid instruments that qualify for exclusion","page_number":90,"box":{"x":336,"y":87,"width":533,"height":12}},{"id":"b8402bc1-ac84-4230-9199-50809ba1d5cc","block_type":"box","text":"from regulation under the Commodity Exchange Act","page_number":90,"box":{"x":116,"y":102,"width":383,"height":13}},{"id":"a68390e9-e21a-4e9f-a0a2-7a3d65307cc4","block_type":"box","text":"and the regulations adopted thereunder. A hybrid","page_number":90,"box":{"x":499,"y":103,"width":362,"height":12}},{"id":"9c25f4fa-7450-4c1a-9aaf-aca79a55f909","block_type":"box","text":"instrument that qualifies for this exclusion from r","page_number":90,"box":{"x":117,"y":118,"width":347,"height":12}},{"id":"d2b5a4d3-5d0c-44ee-92c1-fb773428b857","block_type":"box","text":"egulation must be “predominantly a security.” A hybrid","page_number":90,"box":{"x":464,"y":118,"width":398,"height":12}},{"id":"2db5d3f2-cc11-4336-adca-6921ee5fcbba","block_type":"box","text":"instrument is considered to be predominantly a security if","page_number":90,"box":{"x":117,"y":134,"width":415,"height":12}},{"id":"bbea4a8c-3052-4349-b85c-d108c7580f14","block_type":"box","text":"f (a) the issuer of the hybrid instrument receives","page_number":90,"box":{"x":531,"y":134,"width":347,"height":12}},{"id":"c77cca80-964d-4db9-8bf8-dd247789ad27","block_type":"box","text":"payment in full of the purchase price of the hybr","page_number":90,"box":{"x":117,"y":149,"width":346,"height":12}},{"id":"c5274fb1-ef12-4f8c-9d6c-e1597a2ebfef","block_type":"box","text":"id instrument, substantially contemporaneously with","page_number":90,"box":{"x":463,"y":149,"width":380,"height":12}},{"id":"e0cd0272-0dfe-469a-af51-803e5b50afd0","block_type":"box","text":"delivery of the hybrid instrument; (b) the purchaser or","page_number":90,"box":{"x":116,"y":165,"width":387,"height":12}},{"id":"31ecaf5b-f3bf-43db-a909-8f579893ced6","block_type":"box","text":"r holder of the hybrid instrument is not required to","page_number":90,"box":{"x":502,"y":165,"width":359,"height":12}},{"id":"b4ff4aa5-1568-40fe-8fa2-69eb300cf7f7","block_type":"box","text":"make any payment to the issuer in addition to t","page_number":90,"box":{"x":117,"y":180,"width":335,"height":12}},{"id":"befc9879-86dd-4d61-a19b-29ebe34de72d","block_type":"box","text":"the purchase price paid under subparagraph (a), whether","page_number":90,"box":{"x":452,"y":180,"width":421,"height":12}},{"id":"b47f9e30-80b3-4004-bcf3-17e28d33b7f7","block_type":"box","text":"as margin, settlement payment, or otherwise, during the life","page_number":90,"box":{"x":116,"y":196,"width":423,"height":12}},{"id":"1a68ccf0-b750-4b58-ac49-b52fc344ba37","block_type":"box","text":"fe of the hybrid instrument or at maturity; (c) the","page_number":90,"box":{"x":539,"y":196,"width":346,"height":12}},{"id":"4c726531-8793-40bf-97cd-2c1e4fb41ab4","block_type":"box","text":"issuer of the hybrid instrument is not subject by t","page_number":90,"box":{"x":117,"y":211,"width":351,"height":12}},{"id":"06f44b8e-1f36-4535-97c2-98e479d29260","block_type":"box","text":"he terms of the instrument to mark-to-market margining","page_number":90,"box":{"x":469,"y":211,"width":406,"height":12}},{"id":"101b1b2e-ecc8-4b3c-bcd5-7282ee09197f","block_type":"box","text":"requirements; and (d) the hybrid instrument is not ma","page_number":90,"box":{"x":117,"y":227,"width":385,"height":12}},{"id":"2abe5f91-bfaf-415f-9608-f5614a520a07","block_type":"box","text":"rketed as a contract of sale of a commodity for","page_number":90,"box":{"x":504,"y":227,"width":341,"height":12}},{"id":"d32db3f3-8164-410f-8bbc-2a53cb073339","block_type":"box","text":"future delivery (or option on such a contract) subjec","page_number":90,"box":{"x":116,"y":242,"width":374,"height":12}},{"id":"0c0fab7a-0b8d-4337-af85-02ea19b77a24","block_type":"box","text":"t to applicable provisions of the Commodity Exchange","page_number":90,"box":{"x":490,"y":242,"width":396,"height":12}},{"id":"ac9a750a-7a8d-438b-8f2f-a233c16d947f","block_type":"box","text":"Act. Hybrid instruments may be principal protected, parti","page_number":90,"box":{"x":116,"y":258,"width":408,"height":12}},{"id":"39acdc91-5ea7-4530-8a50-6d724b234c27","block_type":"box","text":"ally protected, or offer no principal protection. A","page_number":90,"box":{"x":525,"y":258,"width":349,"height":12}},{"id":"354f2d23-8ef2-407e-94f8-7ad462441325","block_type":"box","text":"principal protected hybrid instrument means that t","page_number":90,"box":{"x":117,"y":273,"width":359,"height":12}},{"id":"c950315c-5f54-4b19-9f61-d2f4b7269efa","block_type":"box","text":"he issuer will pay, at a minimum, the par value of the","page_number":90,"box":{"x":477,"y":273,"width":387,"height":12}},{"id":"50abd2a1-84c5-4886-8270-8197e17b80d9","block_type":"box","text":"note at maturity. Therefore, if the commodity value to w","page_number":90,"box":{"x":117,"y":289,"width":389,"height":12}},{"id":"a8d53b09-45ad-4dd8-8cf7-b84747f80645","block_type":"box","text":"which the hybrid instrument is linked declines over","page_number":90,"box":{"x":505,"y":289,"width":371,"height":12}},{"id":"e5812f5f-6f2e-4b1c-8e7e-e97e68fae75a","block_type":"box","text":"the life of the note, the Fund will receive","page_number":90,"box":{"x":116,"y":304,"width":294,"height":11}},{"id":"d523fb8a-2fda-4617-ac97-1946794a0a22","block_type":"box","text":"at maturity the face or stated value of the note. With a principal","page_number":90,"box":{"x":410,"y":304,"width":461,"height":12}},{"id":"c066b56b-9691-4942-a1aa-c3b9dda33b88","block_type":"box","text":"protected hybrid instrument, the Fund will receive at matu","page_number":90,"box":{"x":117,"y":320,"width":416,"height":12}},{"id":"b1cf8e07-dd86-4502-a6e1-b366b572cfc2","block_type":"box","text":"rity the greater of the","page_number":90,"box":{"x":535,"y":320,"width":155,"height":12}},{"id":"e1504d9f-e39b-4a1b-945c-e523f9b9e562","block_type":"box","text":"par value of the note or","page_number":90,"box":{"x":691,"y":320,"width":173,"height":12}},{"id":"c77399b1-d357-444e-a2a5-f43eab898bed","block_type":"box","text":"the increase in its value based on the underlying comm","page_number":90,"box":{"x":116,"y":335,"width":400,"height":12}},{"id":"be41da4e-6b1c-495d-ab6d-e56f5f0b1990","block_type":"box","text":"odity or index. This protection is, in effect, an","page_number":90,"box":{"x":518,"y":335,"width":329,"height":12}},{"id":"ac35fee7-1f6c-48ba-9ef6-274169451d79","block_type":"box","text":"option whose value is subject to the volatility and","page_number":90,"box":{"x":116,"y":351,"width":359,"height":12}},{"id":"d1cd25ba-b9b3-487f-bbab-2908df4a594d","block_type":"box","text":"price level of the underlying commodity. The Manager’s","page_number":90,"box":{"x":476,"y":351,"width":407,"height":12}},{"id":"3a3435a9-3e73-416f-ac72-fe46e77ae9e5","block_type":"box","text":"decision whether to use principal protection depends in","page_number":90,"box":{"x":116,"y":366,"width":405,"height":12}},{"id":"59674406-42ad-4e9d-9821-e41cc9812fad","block_type":"box","text":"part on the cost of the protection. In addition, the","page_number":90,"box":{"x":522,"y":366,"width":356,"height":12}},{"id":"24bc2225-5c89-4102-ad0a-e1d5f279241e","block_type":"box","text":"protection feature depends upon the ability","page_number":90,"box":{"x":117,"y":382,"width":314,"height":12}},{"id":"a2649d52-02bd-4291-93c8-6375bb08b0ca","block_type":"box","text":"of the issuer to meet its obligation to buy back the security,","page_number":90,"box":{"x":432,"y":382,"width":431,"height":12}},{"id":"a71e397e-f6c3-43f6-8b6a-1f2e4f07f490","block_type":"box","text":"and, therefore, depends on the creditworthiness of the","page_number":90,"box":{"x":116,"y":397,"width":399,"height":12}},{"id":"a10ffcb0-f72b-48ba-a87a-d8208b8fa6ce","block_type":"box","text":"issuer. With full principal protection, the Fund will","page_number":90,"box":{"x":516,"y":397,"width":358,"height":12}},{"id":"b3eebee9-4b87-41e9-b02f-bf12b6087aa4","block_type":"box","text":"receive at maturity of the hybrid instrument either","page_number":90,"box":{"x":117,"y":413,"width":356,"height":12}},{"id":"5be1975d-0b67-40d0-961e-9a982cbb4b12","block_type":"box","text":"r the stated par value of the hybrid instrument, or","page_number":90,"box":{"x":472,"y":413,"width":354,"height":12}},{"id":"addc21ad-b192-4c34-b67e-2a6ae5065a57","block_type":"box","text":"potentially, an amount greater than","page_number":90,"box":{"x":117,"y":428,"width":258,"height":12}},{"id":"d6a5b6c5-13bd-4ca0-b2cb-2ab00548a489","block_type":"box","text":"the stated par value if the underlying commodity, index, futures","page_number":90,"box":{"x":375,"y":428,"width":461,"height":12}},{"id":"0617fc8b-afb4-40fa-a71c-a53fc5a795e2","block_type":"box","text":"contract or economic variable to which the hybrid in","page_number":90,"box":{"x":116,"y":444,"width":373,"height":12}},{"id":"68faa6b9-53de-4364-ad96-fd648f2294b0","block_type":"box","text":"strument is linked has increased in value. Partially","page_number":90,"box":{"x":490,"y":444,"width":368,"height":12}},{"id":"7f90b5b4-45c7-4f08-ac26-1b9d8c76ae2f","block_type":"box","text":"protected hybrid instruments may suffer some loss of","page_number":90,"box":{"x":117,"y":459,"width":386,"height":12}},{"id":"1bcba13d-fe45-45e8-9b74-100c734c3aec","block_type":"box","text":"f principal if the underlying commodity, index, futures","page_number":90,"box":{"x":502,"y":459,"width":383,"height":12}},{"id":"614755a6-d139-47fd-a659-601342715430","block_type":"box","text":"contract or economic variable to which the hybrid ins","page_number":90,"box":{"x":116,"y":475,"width":381,"height":12}},{"id":"aa1c1fa2-b81c-4c7a-876c-786bdde09e09","block_type":"box","text":"trument is linked declines in value during the term of","page_number":90,"box":{"x":498,"y":475,"width":384,"height":12}},{"id":"12312654-0fd6-49b0-a168-259d77da8633","block_type":"box","text":"the hybrid instrument. However, partially protected hy","page_number":90,"box":{"x":116,"y":490,"width":388,"height":12}},{"id":"002e589f-22df-4bc0-b14d-27d0894c6d43","block_type":"box","text":"brid instruments have a specified limit as to the","page_number":90,"box":{"x":505,"y":490,"width":346,"height":12}},{"id":"6ced5ce3-153d-4209-b49a-64a52da6f442","block_type":"box","text":"amount of principal that they may lose.","page_number":90,"box":{"x":116,"y":506,"width":286,"height":12}},{"id":"fc512a9d-449f-437f-84a4-d6fda9b26edc","block_type":"box","text":"Hybrid Instruments Without Principal Protection.","page_number":90,"box":{"x":116,"y":537,"width":355,"height":12}},{"id":"accb377d-42f9-4675-ae68-cb72241ff78f","block_type":"box","text":"Certain Funds may invest in hybrid instruments that","page_number":90,"box":{"x":473,"y":537,"width":393,"height":12}},{"id":"0de8e1f8-aced-413a-97d5-f99bec9b0968","block_type":"box","text":"offer no principal protection. At maturity, there is a risk that the underlying commodity price, futures","page_number":90,"box":{"x":116,"y":552,"width":738,"height":12}},{"id":"30c4cc7f-adbc-47ff-bbb1-730dca5f9563","block_type":"box","text":"contract, index or other economic variable may have declined sufficiently in value such that some or all","page_number":90,"box":{"x":116,"y":568,"width":768,"height":12}},{"id":"a3c96573-8e5d-459a-8ae6-5ff2df9eaf6a","block_type":"box","text":"of the face value of the hybrid instrument might not be returned. The Manager, at its discretion, may","page_number":90,"box":{"x":116,"y":583,"width":746,"height":12}},{"id":"32026256-8a98-4193-97e3-150f1a09db6a","block_type":"box","text":"invest in a partially protected principal structured note or a note without principal protection. In deciding","page_number":90,"box":{"x":117,"y":599,"width":767,"height":12}},{"id":"60e39dd4-dd12-40f0-9b14-6d991e555185","block_type":"box","text":"to purchase a note without principal protection, the Manager may consider, among other things, the","page_number":90,"box":{"x":116,"y":614,"width":743,"height":12}},{"id":"b53ea88e-072e-494e-95b2-f329617df0a6","block_type":"box","text":"expected performance of the underlying commodity futures contract, index or other economic variable","page_number":90,"box":{"x":116,"y":630,"width":761,"height":12}},{"id":"5617809f-4369-484d-873f-36a31fdcc7f5","block_type":"box","text":"over the term of the note, the cost of the note, and any other economic factors that the Manager","page_number":90,"box":{"x":116,"y":645,"width":717,"height":12}},{"id":"7cf14958-507a-4fb0-a070-bcb5d563a977","block_type":"box","text":"believes are relevant.","page_number":90,"box":{"x":117,"y":661,"width":157,"height":9}},{"id":"ca85bc59-5bc2-41b1-a822-4a97902b6311","block_type":"box","text":"Limitations on Leverage.","page_number":90,"box":{"x":116,"y":692,"width":177,"height":12}},{"id":"90bb74da-4c72-4a35-b4de-353bc66be43e","block_type":"box","text":"Some of the hybrid instruments in which a Fund may invest may involve","page_number":90,"box":{"x":300,"y":692,"width":522,"height":12}},{"id":"1423056b-70cd-4fe8-8674-1145b3656c18","block_type":"box","text":"leverage. To avoid being subject to undue leverage risk,","page_number":90,"box":{"x":117,"y":707,"width":405,"height":12}},{"id":"c0b6f486-d8eb-4f17-89c8-866bb877c8de","block_type":"box","text":"a Fund will seek to limit the amount of economic","page_number":90,"box":{"x":529,"y":707,"width":349,"height":10}},{"id":"d47d542e-85ec-4000-ba79-b88210e09191","block_type":"box","text":"leverage it has under any one hybrid instrument t","page_number":90,"box":{"x":117,"y":723,"width":356,"height":12}},{"id":"a0f7809b-101e-4fe1-b5a4-dc84ba26997e","block_type":"box","text":"hat it buys and the leverage of the Fund’s overall","page_number":90,"box":{"x":474,"y":723,"width":352,"height":12}},{"id":"d485ba96-6494-4025-b565-84a30fab9c7b","block_type":"box","text":"portfolio. A Fund will not invest in a hybrid instrument i","page_number":90,"box":{"x":117,"y":738,"width":390,"height":12}},{"id":"f76618bb-b77b-4a3b-a687-2cccd72cbf7c","block_type":"box","text":"f, at the time of purchase: (i) that instrument’s","page_number":90,"box":{"x":508,"y":738,"width":330,"height":12}},{"id":"2c9a5413-4da3-47b3-8cfc-d948c76f5bc2","block_type":"box","text":"“leverage ratio” exceeds 300% of the price increase","page_number":90,"box":{"x":116,"y":754,"width":375,"height":12}},{"id":"92f75be4-4ccf-4abe-a6da-f7f18007903c","block_type":"box","text":"in the underlying commodity, futures contract, index","page_number":90,"box":{"x":497,"y":754,"width":375,"height":12}},{"id":"7f6e2c94-78d8-4291-9e0a-ec0073df6c18","block_type":"box","text":"or other economic variable or (ii) the Fund’s “portfo","page_number":90,"box":{"x":116,"y":769,"width":369,"height":12}},{"id":"e90b3e76-c965-4d9f-bb30-f2dd93ff6cd2","block_type":"box","text":"lio leverage ratio” exceeds 150%, measured at the","page_number":90,"box":{"x":486,"y":769,"width":366,"height":12}},{"id":"936b161f-fabe-4aeb-9b81-9f6fcfc677d1","block_type":"box","text":"time of purchase. “Leverage ratio” is the expected in","page_number":90,"box":{"x":116,"y":785,"width":378,"height":12}},{"id":"70730833-380f-4c31-b300-728d5742b553","block_type":"box","text":"crease in the value of a hybrid instrument, assuming","page_number":90,"box":{"x":496,"y":785,"width":379,"height":12}},{"id":"f3dd8b8a-f781-4cb1-b8eb-e940445caff4","block_type":"box","text":"a one percent price increase in the underlying commodi","page_number":90,"box":{"x":116,"y":800,"width":403,"height":12}},{"id":"314d2f61-221b-4c4f-9919-51b0de037e58","block_type":"box","text":"ty, futures contract, index or other economic","page_number":90,"box":{"x":520,"y":800,"width":320,"height":12}},{"id":"b605765a-3277-4aed-a6d3-378248f50f82","block_type":"box","text":"factor. In other words, for a hybrid instrument wit","page_number":90,"box":{"x":116,"y":816,"width":352,"height":12}},{"id":"d9a7a418-27f3-4889-b480-d3cf422e6599","block_type":"box","text":"h a leverage factor of 150%, a 1% gain in the underlying","page_number":90,"box":{"x":469,"y":816,"width":407,"height":12}},{"id":"8234ba38-2663-4d91-a6c9-8aa69d228861","block_type":"box","text":"economic variable would be expected to result in a","page_number":90,"box":{"x":116,"y":831,"width":373,"height":12}},{"id":"b0cda24a-0339-450e-a90a-344431c33bba","block_type":"box","text":"1.5% gain in value for the hybrid instrument.","page_number":90,"box":{"x":491,"y":831,"width":323,"height":12}},{"id":"d6001a12-c426-4154-a525-3abc6296d6a2","block_type":"box","text":"Conversely, a hybrid instrument with a leverage fact","page_number":90,"box":{"x":117,"y":847,"width":376,"height":12}},{"id":"115678e5-55b8-4d4e-a9df-b2611cd6ac8a","block_type":"box","text":"or of 150% would suffer a 1.5% loss if the underlying","page_number":90,"box":{"x":494,"y":847,"width":387,"height":12}},{"id":"bb05494e-38cb-4533-ba7b-1ab795d2ae6d","block_type":"box","text":"economic variable lost 1% of its value. “Portfolio","page_number":90,"box":{"x":116,"y":862,"width":348,"height":10}},{"id":"780ea913-c11f-4f3b-9ac7-82fff29974cf","block_type":"box","text":"leverage ratio” is defined as the average (mean)","page_number":90,"box":{"x":465,"y":862,"width":359,"height":12}},{"id":"2db16cfb-6412-4781-a2d5-0d30bbe616eb","block_type":"box","text":"leverage ratio of all instruments in a Fund’s portfolio, we","page_number":90,"box":{"x":117,"y":878,"width":405,"height":12}},{"id":"9fde1957-032d-4054-b43c-0efdc5bd7051","block_type":"box","text":"ighted by the market values of such instruments","page_number":90,"box":{"x":523,"y":878,"width":353,"height":12}},{"id":"b7ec319b-ad78-41fc-8560-5329c5470f1d","block_type":"box","text":"II-6","page_number":90,"box":{"x":489,"y":909,"width":22,"height":9}},{"id":"6a191c4d-462d-4b21-b1e9-074154d322d0","block_type":"box","text":"NM0926U-5926888-90/257","page_number":90,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"ebabc59b-beaa-48bf-ac77-d51126080e64","block_type":"box","text":"or, in the case of futures contracts, their notional v","page_number":91,"box":{"x":116,"y":87,"width":355,"height":11}},{"id":"046cbbb4-fd67-4254-bcd1-ec754a578d7d","block_type":"box","text":"values. A Fund may at times or from time to time decide","page_number":91,"box":{"x":471,"y":87,"width":412,"height":12}},{"id":"dd273d68-5cee-418f-9363-e7100a95e34d","block_type":"box","text":"not to use leverage in its investments or us","page_number":91,"box":{"x":117,"y":103,"width":310,"height":12}},{"id":"8268bcd8-0196-436b-abcb-fe5702e42a35","block_type":"box","text":"e less leverage than may otherwise be allowable.","page_number":91,"box":{"x":428,"y":103,"width":363,"height":12}},{"id":"b8d3efb9-ccf1-4964-a341-2a515eb44baa","block_type":"box","text":"Counterparty Risk.","page_number":91,"box":{"x":117,"y":134,"width":136,"height":12}},{"id":"8b6de445-2f0f-4e60-b48a-3df987bf2058","block_type":"box","text":"A significant risk of hybrid instruments is counterparty risk. Unlike exchange-traded","page_number":91,"box":{"x":255,"y":134,"width":625,"height":12}},{"id":"3e2ed2c1-5d2d-4326-be36-d7db60336a1b","block_type":"box","text":"futures and options, which are standard contracts, hybrid instruments are customized securities, tailor","page_number":91,"box":{"x":116,"y":149,"width":760,"height":12}},{"id":"8590394d-989e-449d-996a-f52c0b7fd89e","block_type":"box","text":"made by a specific issuer. With a listed futures or options contract, an investor’s counterparty is the","page_number":91,"box":{"x":117,"y":165,"width":740,"height":12}},{"id":"d076866d-491f-4a49-b1e3-dcf90f330889","block_type":"box","text":"exchange clearinghouse. Exchange clearinghouses are capitalized by the exchange members and","page_number":91,"box":{"x":116,"y":180,"width":738,"height":12}},{"id":"c39cc253-d4aa-47de-a623-8427f5bfb90e","block_type":"box","text":"typically have high investment grade ratings (","page_number":91,"box":{"x":116,"y":196,"width":336,"height":12}},{"id":"0f3d547a-142b-4b9c-8d70-064a4e112821","block_type":"box","text":"e.g.","page_number":91,"box":{"x":453,"y":198,"width":26,"height":10}},{"id":"6363d293-e1ef-4fd0-850c-1f4237695e85","block_type":"box","text":", ratings of AAA or AA by S&P). Therefore, the risk is","page_number":91,"box":{"x":482,"y":196,"width":396,"height":12}},{"id":"4a4cdecb-72db-4a77-ad91-7be037f4ef8c","block_type":"box","text":"small that an exchange clearinghouse might be unable to meet its obligations at maturity. However,","page_number":91,"box":{"x":116,"y":211,"width":743,"height":12}},{"id":"c097722d-f05c-4b85-8b8c-7bd4d90e4682","block_type":"box","text":"with a hybrid instrument, a Fund will take on the counterparty credit risk of the issuer. That is, at","page_number":91,"box":{"x":116,"y":227,"width":715,"height":12}},{"id":"8bf11a5a-a811-4208-84fd-294f66b0ab6e","block_type":"box","text":"maturity of the hybrid instrument, there is a risk that the issuer may be unable to perform its obligations","page_number":91,"box":{"x":117,"y":242,"width":767,"height":12}},{"id":"e1b5cf63-7f8b-4f08-aeee-646e40511d84","block_type":"box","text":"under the structured note.","page_number":91,"box":{"x":117,"y":258,"width":196,"height":9}},{"id":"6897a35d-1e85-42f2-a501-7418ff528f6d","block_type":"box","text":"Convertible Securities.","page_number":91,"box":{"x":117,"y":289,"width":180,"height":9}},{"id":"f8d5eb01-5f79-4229-8f52-c4e4703449de","block_type":"box","text":"A convertible security is a bond, debenture, note, preferred stock or other","page_number":91,"box":{"x":298,"y":289,"width":554,"height":12}},{"id":"d08158fc-7f0b-4d76-9425-0d821ec1c0c1","block_type":"box","text":"security that may be converted into or exchanged for a prescribed amount of common stock or other","page_number":91,"box":{"x":116,"y":304,"width":750,"height":12}},{"id":"6d4d1b70-0808-4da6-b414-022d977b610b","block_type":"box","text":"equity security of the same or a different issuer within a particular period of time at a specified price or","page_number":91,"box":{"x":116,"y":320,"width":761,"height":12}},{"id":"3bb7c296-ea31-4b0a-bf94-d52e51c8742a","block_type":"box","text":"formula. A convertible security entitles the holder to receive interest paid or accrued on debt or the","page_number":91,"box":{"x":116,"y":335,"width":734,"height":12}},{"id":"a28270b4-3cd8-4ecc-a229-14a652d11f77","block_type":"box","text":"dividend paid on preferred stock until the convertible security matures or is redeemed, converted or","page_number":91,"box":{"x":116,"y":351,"width":742,"height":12}},{"id":"02b9e780-f79e-4ded-89ab-5af4da8d6eb1","block_type":"box","text":"exchanged. Before conversion, convertible securities have characteristics similar to nonconvertible","page_number":91,"box":{"x":116,"y":366,"width":738,"height":12}},{"id":"9ce4777c-ee39-4b40-8476-35ec59eb4d82","block_type":"box","text":"income securities in that they ordinarily provide a stable stream of income with generally higher yields","page_number":91,"box":{"x":117,"y":382,"width":757,"height":12}},{"id":"f1ced80b-2315-4fcf-b14d-d6c980c6c423","block_type":"box","text":"than those of common stocks of the same or similar issuers, but lower yields than comparable","page_number":91,"box":{"x":116,"y":397,"width":703,"height":12}},{"id":"65407cb3-205d-4670-9079-5ce37680b5f8","block_type":"box","text":"nonconvertible securities. The value of a convertible security is influenced by changes in interest rates,","page_number":91,"box":{"x":117,"y":413,"width":767,"height":12}},{"id":"344f4571-715f-4700-a331-52f633b8e94f","block_type":"box","text":"with investment value declining as interest rates increase and increasing as interest rates decline. The","page_number":91,"box":{"x":116,"y":428,"width":764,"height":12}},{"id":"40aeede4-ff5d-4e82-8917-53f7dd6723b0","block_type":"box","text":"credit standing of the issuer and other factors also may have an effect on the convertible security’s","page_number":91,"box":{"x":116,"y":444,"width":736,"height":12}},{"id":"c1c25ca5-61e7-4053-be98-b07eed820841","block_type":"box","text":"investment value. Convertible securities rank senior to common stock in a corporation’s capital","page_number":91,"box":{"x":117,"y":459,"width":706,"height":12}},{"id":"f23de80b-fab5-4011-92ed-7de8f28bb79b","block_type":"box","text":"structure but are usually subordinated to comparable nonconvertible securities. Convertible securities","page_number":91,"box":{"x":116,"y":475,"width":757,"height":12}},{"id":"2f301195-4b46-493f-81c8-6c1024f9286b","block_type":"box","text":"may be subject to redemption at the option of the issuer at a price established in the convertible","page_number":91,"box":{"x":117,"y":490,"width":714,"height":12}},{"id":"15020fd5-9bf4-4b57-8bf7-fd3dd6334e5a","block_type":"box","text":"security’s governing instrument.","page_number":91,"box":{"x":116,"y":506,"width":241,"height":12}},{"id":"879b6541-b20e-4391-ae41-386c93298f2a","block_type":"box","text":"The characteristics of convertible securities make them potentially attractive investments for an","page_number":91,"box":{"x":116,"y":537,"width":710,"height":12}},{"id":"842f9646-4863-4439-8828-9f1196f0f6d0","block_type":"box","text":"investment company seeking a high total return from capital appreciation and investment income.","page_number":91,"box":{"x":117,"y":552,"width":727,"height":12}},{"id":"ee4a3db1-db65-44bf-ab80-c6e2e363490c","block_type":"box","text":"These characteristics include the potential for capital appreciation as the value of the underlying","page_number":91,"box":{"x":116,"y":568,"width":716,"height":12}},{"id":"6dbbf84d-e08e-4c3f-b41b-3a6df8c0c399","block_type":"box","text":"common stock increases, the relatively high yield received from dividend or interest payments as","page_number":91,"box":{"x":116,"y":583,"width":723,"height":12}},{"id":"d6239ef8-34cb-45f1-940f-3973279addb9","block_type":"box","text":"compared to common stock dividends and decreased risks of decline in value relative to the underlying","page_number":91,"box":{"x":116,"y":599,"width":770,"height":12}},{"id":"702aac48-975c-4e0b-9a63-0395851a31d7","block_type":"box","text":"common stock due to their fixed-income nature. As a result of the conversion feature, however, the","page_number":91,"box":{"x":116,"y":614,"width":739,"height":11}},{"id":"f0e2e72b-671d-454a-a280-7ce79a543e17","block_type":"box","text":"interest rate or dividend preference on a convertible security is generally less than would be the case if","page_number":91,"box":{"x":117,"y":630,"width":766,"height":12}},{"id":"8b90f4df-4b7e-452f-b912-18092d137fbc","block_type":"box","text":"the securities were issued in nonconvertible form.","page_number":91,"box":{"x":116,"y":645,"width":373,"height":10}},{"id":"1a24cb74-0d99-4518-a323-a09d609f3803","block_type":"box","text":"In analyzing convertible securities, the Manager will consider both the yield on the convertible security","page_number":91,"box":{"x":117,"y":676,"width":755,"height":12}},{"id":"f37ea539-b78a-4ab4-a11c-b69e03dd6fd0","block_type":"box","text":"relative to its credit quality and the potential capital appreciation that is offered by the underlying","page_number":91,"box":{"x":117,"y":692,"width":710,"height":12}},{"id":"1098e027-b509-45fe-881f-94de37d1c098","block_type":"box","text":"common stock, among other things.","page_number":91,"box":{"x":116,"y":707,"width":265,"height":12}},{"id":"ae9d0068-7fad-441f-8025-4ccded5867f7","block_type":"box","text":"Convertible securities are issued and traded in a number of securities markets. Even in cases where a","page_number":91,"box":{"x":117,"y":738,"width":758,"height":10}},{"id":"a1be9949-a373-40b4-9704-f4dbb4897a40","block_type":"box","text":"substantial portion of the convertible securities held by a Fund are denominated in U.S. dollars, the","page_number":91,"box":{"x":116,"y":754,"width":734,"height":12}},{"id":"a4683c70-523c-45ee-90a5-905995247513","block_type":"box","text":"underlying equity securities may be quoted in the currency of the country where the issuer is domiciled.","page_number":91,"box":{"x":117,"y":769,"width":764,"height":12}},{"id":"ccd49c84-222d-478c-be7c-a227fcc454b2","block_type":"box","text":"As a result, fluctuations in the exchange rate between the currency in which the debt security is","page_number":91,"box":{"x":116,"y":785,"width":707,"height":12}},{"id":"dbec9132-cade-465d-8a1a-87f85d9bc427","block_type":"box","text":"denominated and the currency in which the share price is quoted will affect the value of the convertible","page_number":91,"box":{"x":116,"y":800,"width":761,"height":12}},{"id":"22d15689-c819-4451-8386-86648b577d63","block_type":"box","text":"security. With respect to convertible securities denominated in a currency different from that of the","page_number":91,"box":{"x":116,"y":816,"width":728,"height":12}},{"id":"322564fd-7fe3-4b34-bc10-970ff38e90e8","block_type":"box","text":"underlying equity securities, the conversion price may be based on a fixed exchange rate established","page_number":91,"box":{"x":117,"y":831,"width":756,"height":12}},{"id":"31486cb9-7cf9-4ee4-a7ce-0da22e32581b","block_type":"box","text":"at the time the security is issued, which may increase the effects of currency risk. As described below,","page_number":91,"box":{"x":116,"y":847,"width":763,"height":12}},{"id":"f2938f59-a43b-40e8-88a7-a3a32e69c65d","block_type":"box","text":"a Fund is authorized to enter into foreign currency hedging transactions in which it may seek to reduce","page_number":91,"box":{"x":116,"y":862,"width":766,"height":12}},{"id":"4ba49e0b-e5f3-4139-9029-415b27999622","block_type":"box","text":"the effect of exchange rate fluctuations.","page_number":91,"box":{"x":116,"y":878,"width":298,"height":12}},{"id":"ff08f29a-f02d-440b-ace9-82125990cc27","block_type":"box","text":"II-7","page_number":91,"box":{"x":489,"y":909,"width":22,"height":9}},{"id":"3e95156f-145a-419c-8eb6-05616f0c578c","block_type":"box","text":"NM0926U-5926888-91/257","page_number":91,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"1278b3ad-4b67-4d42-9e41-5dcea4f1575d","block_type":"box","text":"Apart from currency considerations, the value of convertible securities is influenced by both the yield","page_number":92,"box":{"x":116,"y":87,"width":749,"height":12}},{"id":"1b3bc7dc-1bdb-4d64-994e-c22295970276","block_type":"box","text":"on nonconvertible securities of comparable issuers and by the value of the underlying common stock.","page_number":92,"box":{"x":116,"y":102,"width":757,"height":13}},{"id":"d6de0eb2-c064-48ed-bea7-7ebd387efe60","block_type":"box","text":"The value of a convertible security viewed without regard to its conversion feature (","page_number":92,"box":{"x":116,"y":118,"width":617,"height":12}},{"id":"bd018aac-48e6-47e5-9b33-91122a00eb7c","block_type":"box","text":"i.e.","page_number":92,"box":{"x":734,"y":118,"width":20,"height":10}},{"id":"d1592fde-6b59-4503-8334-cf01a9886b9d","block_type":"box","text":", strictly on the","page_number":92,"box":{"x":757,"y":118,"width":112,"height":12}},{"id":"2677e010-0805-46f6-b621-c149173b2fb9","block_type":"box","text":"basis of its yield) is sometimes referred to as its “investment value.” To the extent interest rates","page_number":92,"box":{"x":117,"y":134,"width":709,"height":12}},{"id":"95d07a4d-d0c3-4f8c-86d3-9a9880c88283","block_type":"box","text":"change, the investment value of the convertible security typically will fluctuate. At the same time,","page_number":92,"box":{"x":116,"y":149,"width":720,"height":12}},{"id":"fa9d83b3-53ce-424e-a90b-567860b5ec91","block_type":"box","text":"however, the value of the convertible security will be influenced by its “conversion value,” which is the","page_number":92,"box":{"x":117,"y":165,"width":756,"height":12}},{"id":"9cec3abd-d135-4e2b-9216-a84e6ff2cd66","block_type":"box","text":"market value of the underlying common stock that would be obtained if the convertible security were","page_number":92,"box":{"x":117,"y":180,"width":747,"height":12}},{"id":"4edf1469-2092-452c-8516-4e701b791cd9","block_type":"box","text":"converted. Conversion value fluctuates directly with the price of the underlying common stock. If the","page_number":92,"box":{"x":116,"y":196,"width":746,"height":12}},{"id":"6235bb05-650b-4587-ab5d-f56ab3c60750","block_type":"box","text":"conversion value of a convertible security is substantially below its investment value, the price of the","page_number":92,"box":{"x":116,"y":211,"width":748,"height":12}},{"id":"0d3931c7-6486-4b21-ae7c-ce3c4cbb56a7","block_type":"box","text":"convertible security is governed principally by its investment value. To the extent the conversion value","page_number":92,"box":{"x":116,"y":227,"width":761,"height":12}},{"id":"bc1704d1-88bd-4f11-bf6f-32392138a707","block_type":"box","text":"of a convertible security increases to a point that approximates or exceeds its investment value, the","page_number":92,"box":{"x":116,"y":242,"width":743,"height":12}},{"id":"4c65d701-ee84-4203-86b4-758f14bcb710","block_type":"box","text":"price of the convertible security will be influenced principally by its conversion value. A convertible","page_number":92,"box":{"x":117,"y":258,"width":729,"height":12}},{"id":"8080419d-cb6b-404f-b27e-09f70b590956","block_type":"box","text":"security will sell at a premium over the conversion value to the extent investors place value on the right","page_number":92,"box":{"x":116,"y":273,"width":768,"height":12}},{"id":"2de5abad-4c8e-4e7d-9f6b-97e1fc01b4b2","block_type":"box","text":"to acquire the underlying common stock while holding a fixed-income security. The yield and","page_number":92,"box":{"x":116,"y":289,"width":691,"height":12}},{"id":"facd8ce9-6c3c-4c3b-b020-80f8920606b4","block_type":"box","text":"conversion premium of convertible securities issued in Japan and the Euromarket are frequently","page_number":92,"box":{"x":116,"y":304,"width":718,"height":12}},{"id":"b8311abc-bc7c-42b1-9e0b-911af47c870d","block_type":"box","text":"determined at levels that cause the conversion value to affect their market value more than the","page_number":92,"box":{"x":116,"y":320,"width":708,"height":9}},{"id":"95af080f-4324-4531-a1c9-2794f2c17207","block_type":"box","text":"securities’ investment value.","page_number":92,"box":{"x":116,"y":335,"width":215,"height":10}},{"id":"1ac60580-11c2-4bfa-b5ec-26e3b47e4b18","block_type":"box","text":"Holders of convertible securities generally have a claim on the assets of the issuer prior to the common","page_number":92,"box":{"x":117,"y":362,"width":770,"height":12}},{"id":"dc53df86-a54d-4258-a6b9-9ad59fe47c8c","block_type":"box","text":"stockholders but may be subordinated to other debt securities of the same issuer. A convertible","page_number":92,"box":{"x":116,"y":378,"width":713,"height":12}},{"id":"9b748d24-a827-4964-ad92-33e6e71a0617","block_type":"box","text":"security may be subject to redemption at the option of the issuer at a price established in a charter","page_number":92,"box":{"x":116,"y":393,"width":734,"height":12}},{"id":"9a263274-82a5-49d5-8a57-f9c90642686b","block_type":"box","text":"provision, indenture or other governing instrument pursuant to which the convertible security was","page_number":92,"box":{"x":117,"y":409,"width":723,"height":12}},{"id":"0727ccb4-b159-4bdc-9821-2fbaa082d73d","block_type":"box","text":"issued. If a convertible security held by a Fund is called for redemption, the Fund will be required to","page_number":92,"box":{"x":117,"y":424,"width":741,"height":12}},{"id":"0f1874e0-4bce-4aa8-b04f-a8ea237ba973","block_type":"box","text":"redeem the security, convert it into the underlying common stock or sell it to a third party. Certain","page_number":92,"box":{"x":117,"y":440,"width":723,"height":12}},{"id":"cd20f0c0-5756-4866-9f4c-5ae709b307de","block_type":"box","text":"convertible debt securities may provide a put option to the holder, which entitles the holder to cause","page_number":92,"box":{"x":116,"y":455,"width":745,"height":12}},{"id":"e14f33f9-6a73-4a20-bc0e-233d7c01dc38","block_type":"box","text":"the security to be redeemed by the issuer at a premium over the stated principal amount of the debt","page_number":92,"box":{"x":116,"y":471,"width":745,"height":12}},{"id":"05dcb051-3256-4ff8-9a96-cd4c5fb148ea","block_type":"box","text":"security under certain circumstances.","page_number":92,"box":{"x":116,"y":486,"width":282,"height":12}},{"id":"55c3bbaf-a86f-42d9-9a7c-a3f84d2ff19d","block_type":"box","text":"A Fund may also invest in synthetic convertible securities. Synthetic convertible securities may include","page_number":92,"box":{"x":116,"y":513,"width":765,"height":12}},{"id":"151ffb0e-f4df-4f2a-9adb-05018a7e3354","block_type":"box","text":"either Cash-Settled Convertibles or Manufactured Convertibles. “Cash-Settled Convertibles” are","page_number":92,"box":{"x":116,"y":529,"width":717,"height":9}},{"id":"c7f61edd-b9af-4682-b481-113ee8d6aeee","block_type":"box","text":"instruments that are created by the issuer and have the economic characteristics of traditional","page_number":92,"box":{"x":117,"y":544,"width":701,"height":12}},{"id":"034e40f5-2938-43f6-bd0c-060a180031ba","block_type":"box","text":"convertible securities but may not actually permit conversion into the underlying equity securities in all","page_number":92,"box":{"x":116,"y":560,"width":760,"height":12}},{"id":"2f317555-6dad-42e2-b4fe-6dc1aa5288b2","block_type":"box","text":"circumstances. As an example, a private company may issue a Cash-Settled Convertible that is","page_number":92,"box":{"x":116,"y":575,"width":715,"height":12}},{"id":"da19bcd4-c53b-404d-9e3a-6775567e06df","block_type":"box","text":"convertible into common stock only if the company successfully completes a public offering of its","page_number":92,"box":{"x":116,"y":591,"width":721,"height":12}},{"id":"2766d260-aab0-435e-a213-c50fc16bf859","block_type":"box","text":"common stock prior to maturity and otherwise pays a cash amount to reflect any equity appreciation.","page_number":92,"box":{"x":116,"y":606,"width":751,"height":12}},{"id":"01f8439c-915d-4c28-ab77-31e886bd1ef2","block_type":"box","text":"“Manufactured Convertibles” are created by the Manager or another party by combining separate","page_number":92,"box":{"x":116,"y":622,"width":726,"height":12}},{"id":"9f94edc5-e628-44a1-8a66-7281366d160d","block_type":"box","text":"securities that possess one of the two principal characteristics of a convertible security,","page_number":92,"box":{"x":116,"y":637,"width":651,"height":12}},{"id":"3ee8250a-5b3b-4f20-b2d0-6582ad1afbf0","block_type":"box","text":"i.e.","page_number":92,"box":{"x":767,"y":638,"width":21,"height":9}},{"id":"ecb94bce-c46a-44a9-9574-b006bca0a7fb","block_type":"box","text":", fixed","page_number":92,"box":{"x":791,"y":637,"width":49,"height":12}},{"id":"7646e09f-5df3-450a-ba53-d0ddec681ec3","block_type":"box","text":"income (“fixed-income component”) or a right to acquire equity securities (“convertibility component”).","page_number":92,"box":{"x":117,"y":653,"width":756,"height":12}},{"id":"e3a8212e-0029-4630-b131-08903231c4f0","block_type":"box","text":"The fixed-income component is achieved by investing in nonconvertible fixed-income securities, such","page_number":92,"box":{"x":116,"y":668,"width":751,"height":12}},{"id":"bc36095e-f61f-46a8-978f-2b7861443c40","block_type":"box","text":"as nonconvertible bonds, preferred stocks and money market instruments. The convertibility","page_number":92,"box":{"x":116,"y":684,"width":684,"height":12}},{"id":"9e54cd52-3702-46e4-8be3-89e539cd1ec3","block_type":"box","text":"component is achieved by investing in call options, warrants, or other securities with equity conversion","page_number":92,"box":{"x":116,"y":700,"width":758,"height":12}},{"id":"e5b8b8a3-a8b5-4266-9927-19a3c7fa27f9","block_type":"box","text":"features (“equity features”) granting the holder the right to purchase a specified quantity of the","page_number":92,"box":{"x":116,"y":715,"width":697,"height":12}},{"id":"7b84c1e5-ce50-428f-af51-26883aa2ef45","block_type":"box","text":"underlying stocks within a specified period of time at a specified price or, in the case of a stock index","page_number":92,"box":{"x":117,"y":730,"width":745,"height":13}},{"id":"2afe826a-87a8-41ef-93d7-354bf4cf7814","block_type":"box","text":"option, the right to receive a cash payment based on the value of the underlying stock index.","page_number":92,"box":{"x":116,"y":746,"width":685,"height":12}},{"id":"c8deb713-23b2-4b88-8ed3-445ad72a9bca","block_type":"box","text":"A Manufactured Convertible differs from traditional convertible securities in several respects. Unlike a","page_number":92,"box":{"x":116,"y":773,"width":751,"height":12}},{"id":"83a97890-69a5-4c8b-a7ac-1648fa445b1b","block_type":"box","text":"traditional convertible security, which is a single security that has a unitary market value, a","page_number":92,"box":{"x":116,"y":789,"width":669,"height":12}},{"id":"dc46100d-5df7-4c6b-a682-f44bc3cec30d","block_type":"box","text":"Manufactured Convertible is comprised of two or more separate securities, each with its own market","page_number":92,"box":{"x":117,"y":804,"width":742,"height":12}},{"id":"0cb17830-2af6-46de-a2c2-87c26152f5ad","block_type":"box","text":"value. Therefore, the total “market value” of such a Manufactured Convertible is the sum of the values","page_number":92,"box":{"x":116,"y":820,"width":755,"height":11}},{"id":"a984e78a-f37c-40d6-b2f4-a734d2c4ae14","block_type":"box","text":"of its fixed-income component and its convertibility component.","page_number":92,"box":{"x":116,"y":835,"width":472,"height":12}},{"id":"1fb2b8e9-47d4-4fd5-9f82-f339f19a5d91","block_type":"box","text":"More flexibility is possible in the creation of a Manufact","page_number":92,"box":{"x":117,"y":862,"width":382,"height":12}},{"id":"e5e78783-5471-4065-a4cc-b38d41c41eee","block_type":"box","text":"ctured Convertible than in the purchase of a traditional","page_number":92,"box":{"x":499,"y":862,"width":382,"height":12}},{"id":"8b709371-f693-4a51-9206-acdd883baed5","block_type":"box","text":"convertible security. Because many corporations hav","page_number":92,"box":{"x":116,"y":878,"width":377,"height":12}},{"id":"0c706901-0e3d-44aa-97c8-704de72fecd3","block_type":"box","text":"e not issued convertible securities, the Manager may","page_number":92,"box":{"x":493,"y":878,"width":380,"height":12}},{"id":"d519de68-226c-4b4f-86ed-a14a7d511877","block_type":"box","text":"II-8","page_number":92,"box":{"x":489,"y":909,"width":22,"height":9}},{"id":"63fe00b5-0d3c-4889-a4c2-220bdc5c3ac1","block_type":"box","text":"NM0926U-5926888-92/257","page_number":92,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"8996ea20-a6d5-4c79-a6e3-2fe18dcd13d0","block_type":"box","text":"combine a fixed-income instrument and an equity feature wit","page_number":93,"box":{"x":116,"y":87,"width":429,"height":12}},{"id":"e1085efc-3f79-4354-9c43-d93d697ec448","block_type":"box","text":"h respect to the stock of the issuer of the fixed","page_number":93,"box":{"x":546,"y":87,"width":332,"height":12}},{"id":"200f598d-bde0-4b74-9a85-82150afedfa5","block_type":"box","text":"income instrument to create a synthetic converti","page_number":93,"box":{"x":117,"y":103,"width":338,"height":12}},{"id":"e0c5333d-b287-431b-8893-d231e466af28","block_type":"box","text":"ble security otherwise unavailable in the market. The","page_number":93,"box":{"x":457,"y":103,"width":378,"height":12}},{"id":"e91999b2-4a42-456e-bb8b-31232e0db975","block_type":"box","text":"Manager may also combine a fixed-income instrument of","page_number":93,"box":{"x":117,"y":118,"width":405,"height":12}},{"id":"71d86061-b9af-4c54-9516-3bde1b60d608","block_type":"box","text":"f an issuer with an equity feature with respect to the","page_number":93,"box":{"x":521,"y":118,"width":366,"height":12}},{"id":"226439a6-97ee-44d4-9749-f30f12163864","block_type":"box","text":"stock of a different issuer when the Manager belie","page_number":93,"box":{"x":116,"y":134,"width":354,"height":12}},{"id":"ee5a1fd4-ddab-40a4-abf7-f2807d4d47b1","block_type":"box","text":"ves such a Manufactured Convertible would better","page_number":93,"box":{"x":471,"y":134,"width":362,"height":9}},{"id":"3122273f-a4e1-44e4-aa1f-4e8a45d0ba47","block_type":"box","text":"promote a Fund’s objective than alternative investment","page_number":93,"box":{"x":117,"y":149,"width":389,"height":12}},{"id":"430285b5-5521-48c4-966a-815848bf1ae4","block_type":"box","text":"s. For example, the Manager may combine an equity","page_number":93,"box":{"x":506,"y":149,"width":381,"height":12}},{"id":"4c4ba4ed-0900-4f25-bf73-eee30d84cebb","block_type":"box","text":"feature with respect to an issuer’s stock with a fixed-in","page_number":93,"box":{"x":116,"y":165,"width":383,"height":11}},{"id":"d1a7844d-74da-4fcf-9081-536c5602cd15","block_type":"box","text":"come security of a different issuer in the same","page_number":93,"box":{"x":500,"y":165,"width":332,"height":12}},{"id":"7b89cabc-1447-420c-814d-d17607e30ab2","block_type":"box","text":"industry to diversify the Fund’s credit exposure, or","page_number":93,"box":{"x":117,"y":180,"width":353,"height":12}},{"id":"7e5e713d-7ed8-4e88-8728-a83bede7f78c","block_type":"box","text":"r with a U.S. Treasury instrument to create a","page_number":93,"box":{"x":470,"y":180,"width":315,"height":12}},{"id":"b6365d02-e1f6-4251-bf7f-94cd51101e79","block_type":"box","text":"Manufactured Convertible with a higher credit profile t","page_number":93,"box":{"x":117,"y":196,"width":379,"height":12}},{"id":"6b3201da-d79f-40a4-9c03-684f53824a43","block_type":"box","text":"han a traditional convertible security issued by that","page_number":93,"box":{"x":497,"y":196,"width":363,"height":12}},{"id":"7f7b9336-034f-4f76-88b1-af4229938691","block_type":"box","text":"issuer. A Manufactured Convertible also is a more fl","page_number":93,"box":{"x":117,"y":211,"width":366,"height":10}},{"id":"c3d62d28-fba4-4ab8-bb1a-d72f171ccb67","block_type":"box","text":"exible investment in that its two components may be","page_number":93,"box":{"x":484,"y":211,"width":377,"height":12}},{"id":"ae83940d-aa76-4032-925f-106f7bdee529","block_type":"box","text":"purchased separately and, upon purchasi","page_number":93,"box":{"x":117,"y":227,"width":293,"height":12}},{"id":"f86483c6-6d3e-4be5-bbe1-b8afefc94469","block_type":"box","text":"ng the separate securities, “combined” to create a Manufactured","page_number":93,"box":{"x":412,"y":227,"width":461,"height":12}},{"id":"e3dd6ae1-14e3-451d-8343-e68a505df32c","block_type":"box","text":"Convertible. For example, the Fund may purchase a w","page_number":93,"box":{"x":117,"y":242,"width":375,"height":12}},{"id":"ad4514af-d82f-457a-ab6b-edecd6ef7b7f","block_type":"box","text":"warrant for eventual inclusion in a Manufactured","page_number":93,"box":{"x":492,"y":242,"width":347,"height":10}},{"id":"1cbdc3ee-edac-4ea8-b76a-b286fd271555","block_type":"box","text":"Convertible while postponing the purchase of a su","page_number":93,"box":{"x":117,"y":258,"width":354,"height":12}},{"id":"003e4a72-4584-4844-88d4-631e32d701e2","block_type":"box","text":"itable bond to pair with the warrant pending development","page_number":93,"box":{"x":473,"y":258,"width":407,"height":12}},{"id":"305665cb-9822-4834-b0ff-b5cec3c05d38","block_type":"box","text":"of more favorable market conditions.","page_number":93,"box":{"x":116,"y":273,"width":265,"height":10}},{"id":"2c1edbb1-b0d0-4341-9ee4-78353c12c3cc","block_type":"box","text":"The value of a Manufactured Convertible may respond to certain market fluctuations differently from a","page_number":93,"box":{"x":116,"y":304,"width":761,"height":12}},{"id":"edabc681-0bb9-4ce2-93d2-7184a31f1250","block_type":"box","text":"traditional convertible security with similar characteristics. For example, in the event a Fund created a","page_number":93,"box":{"x":116,"y":320,"width":758,"height":12}},{"id":"0284bf7a-45d8-47fb-a5c2-b444b75cb089","block_type":"box","text":"Manufactured Convertible by combining a short-term U.S. Treasury instrument and a call option on a","page_number":93,"box":{"x":117,"y":335,"width":752,"height":12}},{"id":"5d859b59-b3b0-491e-a4b4-fe6f0a9987d3","block_type":"box","text":"stock, the Manufactured Convertible would be expected to outperform a traditional convertible of","page_number":93,"box":{"x":116,"y":351,"width":720,"height":12}},{"id":"87cab6e5-94bc-400e-825c-937189e01ef0","block_type":"box","text":"similar maturity that is convertible into that stock during periods when Treasury instruments outperform","page_number":93,"box":{"x":116,"y":366,"width":767,"height":12}},{"id":"07c1e697-9811-48e8-a220-f8a128d4588a","block_type":"box","text":"corporate fixed-income securities and underperform during periods when corporate fixed-income","page_number":93,"box":{"x":116,"y":382,"width":722,"height":12}},{"id":"b503c165-f972-4553-86bd-71cc17385ba6","block_type":"box","text":"securities outperform Treasury instruments.","page_number":93,"box":{"x":116,"y":397,"width":329,"height":12}},{"id":"6faa5b80-cf9c-4304-ab33-9bb1cd4d7996","block_type":"box","text":"Corporate Loans.","page_number":93,"box":{"x":117,"y":428,"width":137,"height":12}},{"id":"1111227e-1327-4b10-a8f1-ce81f034c33d","block_type":"box","text":"Certain Funds may invest in corporate loans. Corporate loans are generally","page_number":93,"box":{"x":255,"y":428,"width":570,"height":12}},{"id":"2c69acdc-957c-4469-83bf-571b17a48c2e","block_type":"box","text":"non-investment grade floating rate instruments. Usually, they are freely callable at the issuer’s option.","page_number":93,"box":{"x":117,"y":444,"width":757,"height":12}},{"id":"a9e7086f-944f-4a15-92aa-b62a1a90926c","block_type":"box","text":"Certain Funds may invest in fixed and floating rate loans (“Loans”) arranged through private","page_number":93,"box":{"x":117,"y":459,"width":685,"height":12}},{"id":"2b4a3b11-4455-4f58-aa93-3399b6b755a9","block_type":"box","text":"negotiations between a corporate borrower or a foreign sovereign entity and one or more financial","page_number":93,"box":{"x":117,"y":475,"width":730,"height":12}},{"id":"eb8baa9a-00a8-4020-bd94-92bb98c8c250","block_type":"box","text":"institutions or institutional investors (“Lenders”). A Fund may invest in such Loans in the form of","page_number":93,"box":{"x":117,"y":490,"width":712,"height":12}},{"id":"4e0eaedb-5f8e-402b-be1c-91b78b17a9cc","block_type":"box","text":"participations in Loans (“Participations”) and assignments of all or a portion of Loans from third parties","page_number":93,"box":{"x":117,"y":506,"width":761,"height":12}},{"id":"e696632f-fe11-47db-93f6-598669b41571","block_type":"box","text":"(“Assignments”). A Fund considers these investments to be investments in debt securities for purposes","page_number":93,"box":{"x":117,"y":521,"width":769,"height":12}},{"id":"eaa8e495-33ea-49fb-beb7-55634c80b91f","block_type":"box","text":"of its investment policies. Participations typically will result in the Fund having a contractual relationship","page_number":93,"box":{"x":116,"y":537,"width":770,"height":12}},{"id":"c1acbd28-56ca-4f10-832c-5a33a9f870bc","block_type":"box","text":"only with the Lender, not with the borrower. The Fund will have the right to receive payments of","page_number":93,"box":{"x":116,"y":552,"width":712,"height":12}},{"id":"1f4a751f-21e6-400b-966f-cd077dd4054d","block_type":"box","text":"principal, interest and any fees to which it is entitled only from the Lender selling the Participation and","page_number":93,"box":{"x":117,"y":568,"width":756,"height":12}},{"id":"6ea3ef9d-e6c1-45b0-bf4a-5cea43a044a3","block_type":"box","text":"only upon receipt by the Lender of the payments from the borrower. In connection with purchasing","page_number":93,"box":{"x":116,"y":583,"width":734,"height":12}},{"id":"a2283fbf-126c-4bd1-801a-782eaee8cc8d","block_type":"box","text":"Participations, the Fund generally will have no right to enforce compliance by the borrower with the","page_number":93,"box":{"x":117,"y":599,"width":737,"height":12}},{"id":"16a19b10-51e1-4496-bdf0-2bd8bb2459d0","block_type":"box","text":"terms of the loan agreement relating to the Loans, nor any rights of set-off against the borrower, and","page_number":93,"box":{"x":116,"y":614,"width":750,"height":12}},{"id":"d72697d2-6f62-4f7c-9f2d-eec23c947d4a","block_type":"box","text":"the Fund may not benefit directly from any collateral supporting the Loan in which it has purchased the","page_number":93,"box":{"x":116,"y":630,"width":766,"height":12}},{"id":"ae01058f-53ed-439a-958d-62672f27738e","block_type":"box","text":"Participation. As a result, the Fund will assume the credit risk of both the borrower and the Lender that","page_number":93,"box":{"x":117,"y":645,"width":763,"height":12}},{"id":"f0f480fb-88e7-4c99-9850-719725ceb4cd","block_type":"box","text":"is selling the Participation. In the event of the insolvency of the Lender selling the Participation, the","page_number":93,"box":{"x":117,"y":661,"width":730,"height":12}},{"id":"0d5b31a4-9e48-41a7-b0f7-7da6c1dfae32","block_type":"box","text":"Fund may be treated as a general creditor of the Lender and may not benefit from any set-off between","page_number":93,"box":{"x":117,"y":676,"width":758,"height":12}},{"id":"fb5b7b8a-0ddf-4151-b55d-fd8c68628145","block_type":"box","text":"the Lender and the borrower. The Fund will acquire Participations only if the Lender interpositioned","page_number":93,"box":{"x":116,"y":692,"width":734,"height":12}},{"id":"772d0fb7-21e7-4d5c-8fb1-012bee6f1edd","block_type":"box","text":"between the Fund and the borrower is determined by the Fund’s manager to be creditworthy. When","page_number":93,"box":{"x":117,"y":707,"width":738,"height":12}},{"id":"473e889d-65eb-47a2-bfe8-970a0cb14ae8","block_type":"box","text":"the Fund purchases Assignments from Lenders, the Fund will acquire direct rights against the borrower","page_number":93,"box":{"x":116,"y":723,"width":767,"height":12}},{"id":"3a3ad77d-23ce-4655-bd3d-a279c0d2565d","block_type":"box","text":"on the Loan, and will not have exposure to a counterparty’s credit risk. The Funds may enter into","page_number":93,"box":{"x":116,"y":738,"width":718,"height":12}},{"id":"239fc0bc-3d7d-4991-81a3-4c3f084ef92f","block_type":"box","text":"Participations and Assignments on a forward commitment or “when-issued” basis, whereby a Fund","page_number":93,"box":{"x":117,"y":754,"width":731,"height":12}},{"id":"fd5ee1dd-6820-4565-acda-9104fbccaa27","block_type":"box","text":"would agree to purchase a Participation or Assignment at set terms in the future. For more information","page_number":93,"box":{"x":116,"y":769,"width":759,"height":12}},{"id":"9da8a197-2365-4667-8c62-63a512d5dba1","block_type":"box","text":"on forward commitments and when-issued securities, see “When-Issued Securities, Delayed Delivery","page_number":93,"box":{"x":116,"y":785,"width":753,"height":12}},{"id":"efe508b9-45e4-4064-9646-0bf3dbae7209","block_type":"box","text":"Securities and Forward Commitments” below.","page_number":93,"box":{"x":116,"y":800,"width":339,"height":10}},{"id":"b2ccad86-e364-45c1-b582-2f26d1bbaa75","block_type":"box","text":"A Fund may have difficulty disposing of Assignments and Participations. In certain cases, the market","page_number":93,"box":{"x":116,"y":831,"width":752,"height":12}},{"id":"0490870a-5add-4ebc-9b34-7608a90a3010","block_type":"box","text":"for such instruments may lack sufficient liquidity, and therefore the Fund anticipates that in such cases","page_number":93,"box":{"x":116,"y":847,"width":764,"height":12}},{"id":"52d6a669-0530-4d13-b732-2b9666f35892","block_type":"box","text":"such instruments could be sold only to a limited number of institutional investors. The lack of a","page_number":93,"box":{"x":116,"y":862,"width":704,"height":12}},{"id":"52519bda-f877-44a0-9d16-db9267975ff7","block_type":"box","text":"sufficiently liquid secondary market may have an adverse impact on the value of such instruments and","page_number":93,"box":{"x":116,"y":878,"width":765,"height":12}},{"id":"eaa74efe-fe7d-42db-ae3b-87f71fa950b1","block_type":"box","text":"II-9","page_number":93,"box":{"x":489,"y":909,"width":22,"height":9}},{"id":"7faa822d-18bd-445b-b028-fd048c7245cd","block_type":"box","text":"NM0926U-5926888-93/257","page_number":93,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"3e502b3d-574d-448f-879a-635cd37ba0ca","block_type":"box","text":"on the Fund’s ability to dispose of particular Assignments or Participations in response to a specific","page_number":94,"box":{"x":116,"y":87,"width":740,"height":12}},{"id":"8ddc6b1d-a440-40a1-b3a3-9a9ebdcedee0","block_type":"box","text":"economic event, such as deterioration in the creditworthiness of the borrower.","page_number":94,"box":{"x":116,"y":102,"width":583,"height":12}},{"id":"97f8e535-0ee8-4b27-8e6b-88d1f0a4b13e","block_type":"box","text":"Leading financial institutions often act as agent for a broader group of Lenders, generally referred to as","page_number":94,"box":{"x":117,"y":132,"width":768,"height":12}},{"id":"26eb051f-3b51-4845-8631-b8d571f03197","block_type":"box","text":"a syndicate. The syndicate’s agent arranges the loans, holds collateral and accepts payments of","page_number":94,"box":{"x":116,"y":147,"width":720,"height":12}},{"id":"8f9c199e-d3cf-445c-a887-dd00c69f29e6","block_type":"box","text":"principal and interest. Failure by the syndicate agent to fulfill its obligations may delay or adversely","page_number":94,"box":{"x":117,"y":163,"width":734,"height":12}},{"id":"7cd1e21f-6be9-4cec-a1e3-aaf642d4baab","block_type":"box","text":"affect receipt of payment by the Fund.","page_number":94,"box":{"x":116,"y":178,"width":287,"height":12}},{"id":"30ad5ad1-0693-43d1-a2f7-3afd910c8f2d","block_type":"box","text":"The Loans in which the Fund may invest are subject to the risk of loss of principal and income.","page_number":94,"box":{"x":116,"y":207,"width":706,"height":12}},{"id":"efe9f5c4-2ef4-4408-85ca-7259942e7611","block_type":"box","text":"Although borrowers frequently provide collateral to secure repayment of these obligations they do not","page_number":94,"box":{"x":116,"y":223,"width":757,"height":12}},{"id":"b6e30e55-cda2-4900-951d-898373aef55d","block_type":"box","text":"always do so. If they do provide collateral, the value of the collateral may not completely cover the","page_number":94,"box":{"x":116,"y":238,"width":732,"height":12}},{"id":"f2c49421-fd74-4922-8be0-1ba933470add","block_type":"box","text":"borrower’s obligations at the time of a default. If a borrower files for protection from its creditors under","page_number":94,"box":{"x":117,"y":254,"width":757,"height":12}},{"id":"1fe89b07-aa0f-43ba-bcb0-3990c3ba9328","block_type":"box","text":"the U.S. bankruptcy laws, these laws may limit a Fund’s rights to its collateral. In addition, the value of","page_number":94,"box":{"x":116,"y":269,"width":761,"height":12}},{"id":"fd0dce99-ac03-469e-9757-5c48a29e02d3","block_type":"box","text":"collateral may erode during a bankruptcy case. In the event of a bankruptcy, the holder of a Loan may","page_number":94,"box":{"x":116,"y":285,"width":762,"height":12}},{"id":"5c0ea8d0-035f-4b24-8fdd-0f24b544a97d","block_type":"box","text":"not recover its principal, may experience a long delay in recovering its investment and may not receive","page_number":94,"box":{"x":117,"y":300,"width":765,"height":12}},{"id":"8f8e8cae-aea9-45cf-a51d-b2f0e83be7a2","block_type":"box","text":"interest during the delay.","page_number":94,"box":{"x":117,"y":316,"width":188,"height":12}},{"id":"80ce7983-0719-4ce5-a099-bd2b40d42858","block_type":"box","text":"Transactions in corporate loans may settle on a delayed basis. As a result, the proceeds from the sale","page_number":94,"box":{"x":116,"y":345,"width":763,"height":12}},{"id":"253d0611-8ded-430c-bd38-e10544bb8dab","block_type":"box","text":"of corporate loans may not be readily available to make additional investments or to meet a Fund’s","page_number":94,"box":{"x":116,"y":360,"width":738,"height":12}},{"id":"c7d1727a-ac0d-4f2d-97f2-dfda6cbffda9","block_type":"box","text":"redemption obligations. To the extent the extended settlement process gives rise to short-term liquidity","page_number":94,"box":{"x":117,"y":376,"width":765,"height":12}},{"id":"a05735ca-7684-45a1-a71e-b9ababa7a991","block_type":"box","text":"needs, a Fund may hold additional cash, sell investments or temporarily borrow from banks and other","page_number":94,"box":{"x":117,"y":391,"width":758,"height":12}},{"id":"fd8fbea0-07ec-44f6-bb3c-663665c8e27c","block_type":"box","text":"lenders.","page_number":94,"box":{"x":117,"y":407,"width":63,"height":9}},{"id":"00de00a5-5687-4b83-9f3b-1c61181d9940","block_type":"box","text":"In certain circumstances, Loans may not be deemed to be securities under certain federal securities","page_number":94,"box":{"x":117,"y":436,"width":746,"height":12}},{"id":"a0036b50-0ce3-4f2a-aa3d-3f0d7123602f","block_type":"box","text":"laws. Therefore, in the event of fraud or misrepresentation by a borrower or an arranger, Lenders and","page_number":94,"box":{"x":117,"y":451,"width":758,"height":12}},{"id":"04f0c2f8-d3d2-412a-8604-8227b2e44066","block_type":"box","text":"purchasers of interests in Loans, such as the Funds, may not have the protection of the anti-fraud","page_number":94,"box":{"x":117,"y":467,"width":729,"height":12}},{"id":"b1c6046b-5972-4a96-a611-96b7d874114d","block_type":"box","text":"provisions of the federal securities laws as would otherwise be available for bonds or stocks. Instead,","page_number":94,"box":{"x":117,"y":482,"width":755,"height":12}},{"id":"c9332078-496e-4213-ae37-d2687d06f6e0","block_type":"box","text":"in such cases, parties generally would rely on the contractual provisions in the Loan agreement itself","page_number":94,"box":{"x":117,"y":498,"width":750,"height":12}},{"id":"bc59d7d0-087d-4b24-a651-035960efbe02","block_type":"box","text":"and common-law fraud protections under applicable state law.","page_number":94,"box":{"x":116,"y":513,"width":467,"height":12}},{"id":"a8fc683d-2c99-4c3f-84c5-7828c11b826d","block_type":"box","text":"Direct Lending.","page_number":94,"box":{"x":116,"y":543,"width":109,"height":11}},{"id":"01a7fcbd-bee0-4ccb-8cfd-12892f879eb9","block_type":"box","text":"The Fund may act as the originator for direct loans and engage in direct lending. Direct","page_number":94,"box":{"x":226,"y":542,"width":641,"height":13}},{"id":"8a9691ad-c2fb-4a7e-815d-99468a397e3b","block_type":"box","text":"loans between the Fund and a borrower may not be adm","page_number":94,"box":{"x":117,"y":558,"width":412,"height":12}},{"id":"68445508-1d84-4c81-828a-d328fe4af56b","block_type":"box","text":"inistered by an underwriter or agent bank. The","page_number":94,"box":{"x":531,"y":558,"width":340,"height":12}},{"id":"f872915f-c923-4c84-b511-a0b932898f60","block_type":"box","text":"Fund may provide financing to commercial borrowers di","page_number":94,"box":{"x":117,"y":573,"width":402,"height":13}},{"id":"7f386997-4408-4b1a-a800-4c83e45756dc","block_type":"box","text":"rectly or through companies acquired (or created)","page_number":94,"box":{"x":521,"y":573,"width":364,"height":13}},{"id":"1275d3e7-9790-415a-8eb5-7567de355bfa","block_type":"box","text":"and owned by or otherwise affiliat","page_number":94,"box":{"x":116,"y":589,"width":244,"height":12}},{"id":"de021b4d-9f5e-434d-9f5c-6dc2af4be25c","block_type":"box","text":"ed with the Fund. The terms of the","page_number":94,"box":{"x":360,"y":589,"width":255,"height":9}},{"id":"619961e9-497d-4eb4-a949-2a71b44af2d3","block_type":"box","text":"direct loans are negotiated with","page_number":94,"box":{"x":616,"y":589,"width":231,"height":12}},{"id":"1b43707e-4fb7-4abd-a10b-638f0034da46","block_type":"box","text":"borrowers in private transactions. Furthermore, a direct loan may be secured or unsecured.","page_number":94,"box":{"x":117,"y":605,"width":667,"height":12}},{"id":"6de00a7e-bc8c-4b96-973f-aa969fc454ff","block_type":"box","text":"In determining whether to make a direct loan, the Fund will rely primarily upon the creditworthiness of","page_number":94,"box":{"x":117,"y":634,"width":755,"height":12}},{"id":"e94137f3-725a-40d7-931e-3b1cd44154dd","block_type":"box","text":"the borrower and/or any collateral for payment of interest and repayment of principal. The risks","page_number":94,"box":{"x":116,"y":649,"width":708,"height":12}},{"id":"14fb5420-ab17-4def-89d9-12f7ff3dbef1","block_type":"box","text":"associated with direct loans are substantially similar to those associated with investing in corporate","page_number":94,"box":{"x":116,"y":665,"width":733,"height":12}},{"id":"73d3eb4d-db3e-46c8-991f-aec285480092","block_type":"box","text":"loans. In making a direct loan, the Fund is exposed to the risk that the borrower may default or become","page_number":94,"box":{"x":117,"y":680,"width":764,"height":12}},{"id":"8da337ae-7d9b-4c55-b422-b79aed11f534","block_type":"box","text":"insolvent and, consequently, that the Fund will lose money on the loan. Furthermore, direct loans may","page_number":94,"box":{"x":117,"y":696,"width":755,"height":12}},{"id":"03beae92-84b2-422c-af58-2ad4e3a26f4f","block_type":"box","text":"subject the Fund to liquidity and interest rate risk and certain direct loans may be deemed illiquid.","page_number":94,"box":{"x":116,"y":711,"width":720,"height":12}},{"id":"104c32db-0ec3-4425-88cf-c5fe27871fc4","block_type":"box","text":"Direct loans are not publicly traded and may not have a secondary market. The lack of a secondary","page_number":94,"box":{"x":117,"y":727,"width":737,"height":12}},{"id":"5f2f913f-117a-4c2a-963c-f12753711208","block_type":"box","text":"market for direct loans may have an adverse impact on the ability of the Fund to dispose of a direct","page_number":94,"box":{"x":117,"y":742,"width":734,"height":12}},{"id":"879f28ed-6c13-465b-8525-cc0afe4f0614","block_type":"box","text":"loan and/or to value the direct loan.","page_number":94,"box":{"x":117,"y":758,"width":260,"height":9}},{"id":"1534eaec-1680-4baa-80f6-816c44561d5f","block_type":"box","text":"When engaging in direct lending, the Fund’s performance may depend, in part, on the ability of the","page_number":94,"box":{"x":116,"y":787,"width":731,"height":12}},{"id":"60f03e55-b0c6-47e0-afd1-a2547b4dcb23","block_type":"box","text":"Fund to originate loans on advantageous terms. In originating loans, the Fund will compete with a","page_number":94,"box":{"x":117,"y":802,"width":722,"height":12}},{"id":"4eb05fdb-63fd-4a08-8583-8756adf43c9e","block_type":"box","text":"broad spectrum of lenders. Increased competition for, or a diminishment in the available supply of,","page_number":94,"box":{"x":117,"y":818,"width":727,"height":12}},{"id":"c81b0b03-8d22-43b1-93d1-ed07d56781ad","block_type":"box","text":"qualifying loans could result in lower yields on such loans, which could reduce Fund performance.","page_number":94,"box":{"x":116,"y":833,"width":730,"height":12}},{"id":"be6d3a5f-5149-4753-ad8a-f9dcaaadf54e","block_type":"box","text":"As part of its lending activities, the Fund may originate loans to companies that are experiencing","page_number":94,"box":{"x":116,"y":862,"width":719,"height":12}},{"id":"f8adfccc-1207-49f6-8823-e6c2d25cd991","block_type":"box","text":"significant financial or business difficulties, including companies involved in bankruptcy or other","page_number":94,"box":{"x":116,"y":878,"width":710,"height":12}},{"id":"be7546dd-c44f-4901-a7ba-8d95a1105b23","block_type":"box","text":"II-10","page_number":94,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"e7d1608b-9e79-4567-90bc-562b8468d35b","block_type":"box","text":"NM0926U-5926888-94/257","page_number":94,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"72263e8f-7f48-4e84-b00f-7db1f7a58994","block_type":"box","text":"reorganization and liquidation proceedings. Although the terms of such financing may result in","page_number":95,"box":{"x":117,"y":87,"width":701,"height":12}},{"id":"7d2c9e9b-456c-4345-a55a-7b957badb7ff","block_type":"box","text":"significant financial returns to the Fund, they involve a substantial degree of risk. The level of analytical","page_number":95,"box":{"x":116,"y":102,"width":768,"height":13}},{"id":"e463f146-f43b-46d3-8bf6-74f45bf9ff45","block_type":"box","text":"sophistication, both financial and legal, necessary for successful financing to companies experiencing","page_number":95,"box":{"x":116,"y":118,"width":758,"height":12}},{"id":"62fcce71-7b39-487f-8b8a-a26ddd3d02b7","block_type":"box","text":"significant business and financial difficulties is unusually high.","page_number":95,"box":{"x":116,"y":134,"width":461,"height":12}},{"id":"82ba9907-5c8c-45f2-bdd6-336b5255940b","block_type":"box","text":"Credit Linked Securities.","page_number":95,"box":{"x":117,"y":162,"width":195,"height":10}},{"id":"0f9aee45-e168-4a30-a420-bc7d2221c7e2","block_type":"box","text":"Among the income producing securities in which a Fund may invest are","page_number":95,"box":{"x":313,"y":162,"width":541,"height":12}},{"id":"8fa95545-3eaf-4c58-8e73-ca130104fd94","block_type":"box","text":"credit linked securities, which are issued by a limited purpose trust or other vehicle that, in turn, invests","page_number":95,"box":{"x":116,"y":178,"width":768,"height":12}},{"id":"690d99ba-90c4-4043-9861-e9c96d949d19","block_type":"box","text":"in a derivative instrument or basket of derivative instruments, such as credit default swaps, interest rate","page_number":95,"box":{"x":117,"y":193,"width":771,"height":12}},{"id":"4e561421-1b8c-4da8-af12-2390452b13be","block_type":"box","text":"swaps and other securities, in order to provide exposure to certain fixed-income markets. For instance,","page_number":95,"box":{"x":116,"y":209,"width":768,"height":12}},{"id":"8c5dc271-2826-4bda-a499-b75e8b82f5f6","block_type":"box","text":"a Fund may invest in credit linked securities as a cash management tool in order to gain exposure to a","page_number":95,"box":{"x":116,"y":224,"width":765,"height":12}},{"id":"972dfa49-242b-4166-9aca-ad39c4cbf495","block_type":"box","text":"certain market and/or to remain fully invested when more traditional income producing securities are","page_number":95,"box":{"x":116,"y":240,"width":748,"height":12}},{"id":"e86864b5-980b-439f-a78c-ebf90ae40e23","block_type":"box","text":"not available.","page_number":95,"box":{"x":117,"y":255,"width":103,"height":10}},{"id":"7f0512b6-7e0b-4662-99cb-aadcf0f5786c","block_type":"box","text":"Like an investment in a bond, investments in these credit linked securities represent the right to receive","page_number":95,"box":{"x":117,"y":284,"width":770,"height":12}},{"id":"0e0a1d21-3d08-4826-bebc-ca95c179ea4f","block_type":"box","text":"periodic income payments (in the form of distributions) and payment of principal at the end of the term","page_number":95,"box":{"x":117,"y":300,"width":761,"height":12}},{"id":"6dd2d26b-aae6-47c9-a5a8-74f73419461d","block_type":"box","text":"of the security.","page_number":95,"box":{"x":116,"y":315,"width":114,"height":12}},{"id":"eb7da3da-a8f0-422d-b4f5-fbccbda420d9","block_type":"box","text":"However, these payments are conditioned on the issuer’s receipt of payments from, and the issuer’s","page_number":95,"box":{"x":117,"y":344,"width":748,"height":12}},{"id":"d34160b4-e803-4dc2-be05-b1ec028af990","block_type":"box","text":"potential obligations to, the counterparties to the derivative instruments and other securities in which","page_number":95,"box":{"x":117,"y":359,"width":747,"height":12}},{"id":"88f0b266-68c5-450d-b7b6-41b287b3e910","block_type":"box","text":"the issuer invests. For instance, the issuer may sell one or more credit default swaps, under which the","page_number":95,"box":{"x":116,"y":375,"width":762,"height":12}},{"id":"5eb18022-2102-44fb-9fe0-183b9d66048b","block_type":"box","text":"issuer would receive a stream of payments over the term of the swap agreements provided that no","page_number":95,"box":{"x":117,"y":390,"width":736,"height":12}},{"id":"b79ff5bd-f3ca-436c-8100-d3a4be2d84d9","block_type":"box","text":"event of default has occurred with respect to the referenced debt obligation upon which the swap is","page_number":95,"box":{"x":116,"y":406,"width":741,"height":12}},{"id":"2e2741f1-8fb2-4cdd-b3d2-2f14ab087531","block_type":"box","text":"based. If a default occurs, the stream of payments may stop and the issuer would be obligated to pay","page_number":95,"box":{"x":117,"y":421,"width":756,"height":12}},{"id":"407c27db-abdf-4661-b3ac-15ab54e34ec3","block_type":"box","text":"the counterparty the par (or other agreed upon value) of the referenced debt obligation. This, in turn,","page_number":95,"box":{"x":116,"y":437,"width":749,"height":12}},{"id":"4f8dba5f-2fd8-4d93-9d8a-09f72da02ea2","block_type":"box","text":"would reduce the amount of income and principal that","page_number":95,"box":{"x":116,"y":452,"width":404,"height":12}},{"id":"766f3e54-3366-4edd-bc7a-590c491c71fd","block_type":"box","text":"a Fund would receive. A Fund’s investments in","page_number":95,"box":{"x":521,"y":452,"width":351,"height":10}},{"id":"74d10e5f-a9be-4e1d-974a-9ff6d19a94f8","block_type":"box","text":"these instruments are indirectly subject to the risks associated with derivative instruments, including,","page_number":95,"box":{"x":116,"y":468,"width":750,"height":12}},{"id":"c8d1cd95-29d5-4e59-b40b-f14ad9ea4e89","block_type":"box","text":"among others, credit risk, default or similar event risk, counterparty risk, interest rate risk, leverage risk","page_number":95,"box":{"x":116,"y":483,"width":766,"height":12}},{"id":"bce1ad78-33ea-45bf-b0cd-629a0932fa63","block_type":"box","text":"and management risk. It is also expected that the securities will be exempt from registration under the","page_number":95,"box":{"x":116,"y":499,"width":761,"height":12}},{"id":"a50cf6d1-d2d5-42b2-8eb0-0086febeb5e9","block_type":"box","text":"Securities Act. Accordingly, there may be no established trading market for the securities and they may","page_number":95,"box":{"x":116,"y":514,"width":771,"height":12}},{"id":"fd85077d-364a-49e9-be66-c56edb5c9ae0","block_type":"box","text":"constitute illiquid investments.","page_number":95,"box":{"x":116,"y":530,"width":227,"height":12}},{"id":"bfaf45f0-9def-4e01-ac2d-5cdfa3c7a8d1","block_type":"box","text":"Debt Securities.","page_number":95,"box":{"x":116,"y":559,"width":126,"height":9}},{"id":"26fa73f8-51f2-429d-a736-2fb857a39136","block_type":"box","text":"Debt securities, such as bonds, involve credit risk. This is the risk that the issuer will","page_number":95,"box":{"x":243,"y":559,"width":633,"height":11}},{"id":"ef981ee0-ec08-475e-a9ed-4917b056eeeb","block_type":"box","text":"not make timely payments of principal and interest. The degree of credit risk depends on the issuer’s","page_number":95,"box":{"x":117,"y":574,"width":751,"height":12}},{"id":"139da090-b788-4d96-aecd-9499d51c32d6","block_type":"box","text":"financial condition and on the terms of the debt securities. Changes in an issuer’s credit rating or the","page_number":95,"box":{"x":116,"y":590,"width":749,"height":12}},{"id":"d6b3e222-bf5c-4ab9-b2d2-386f0e3dd020","block_type":"box","text":"market’s perception of an issuer’s creditworthiness may also affect the value of a Fund’s investment in","page_number":95,"box":{"x":117,"y":605,"width":763,"height":12}},{"id":"e20a7576-f702-4d5d-a175-5d6b2f44bb69","block_type":"box","text":"that issuer. Credit risk is reduced to the extent a Fund limits its debt investments to U.S. Government","page_number":95,"box":{"x":116,"y":621,"width":754,"height":9}},{"id":"62ed4454-9682-4817-b6a9-e703c8d6f3e2","block_type":"box","text":"Securities.","page_number":95,"box":{"x":116,"y":636,"width":83,"height":10}},{"id":"1e1f70e9-697a-40c8-b7eb-8c2bd6a7904c","block_type":"box","text":"All debt securities, however, are subject to interest rate risk. This is the risk that the value of the","page_number":95,"box":{"x":116,"y":665,"width":709,"height":12}},{"id":"4e606e31-927f-4d2b-9f0a-90c39a50281a","block_type":"box","text":"security may fall when interest rates rise. If interest rates move sharply in a manner not anticipated by","page_number":95,"box":{"x":116,"y":680,"width":755,"height":12}},{"id":"8c4a621a-81a3-4506-a745-2e9ca5b79f42","block_type":"box","text":"Fund management, a Fund’s investments in debt securities could be adversely affected and the Fund","page_number":95,"box":{"x":117,"y":696,"width":752,"height":12}},{"id":"93b1237b-41a0-4808-a72c-9fbbdbfdaebd","block_type":"box","text":"could lose money. In general, the market price of debt securities with longer maturities will go up or","page_number":95,"box":{"x":116,"y":711,"width":735,"height":12}},{"id":"3b4f506e-17a7-412b-b84a-25d75a41ff27","block_type":"box","text":"down more in response to changes in interest rates than will the market price of shorter-term debt","page_number":95,"box":{"x":116,"y":727,"width":725,"height":12}},{"id":"7fd67a0c-25ad-4043-9d4c-5c2d3793712c","block_type":"box","text":"securities.","page_number":95,"box":{"x":116,"y":743,"width":74,"height":9}},{"id":"8b8b0193-b802-493d-bef4-f775601ae3ec","block_type":"box","text":"During periods of rising interest rates, the average life of certain fixed-income securities is extended","page_number":95,"box":{"x":117,"y":771,"width":738,"height":12}},{"id":"3921a18e-f08f-4055-b2cb-7bb708633ed1","block_type":"box","text":"because of slower than expected principal payments. This may lock in a below-market interest rate and","page_number":95,"box":{"x":117,"y":787,"width":765,"height":12}},{"id":"8faa23db-1a1d-4454-a782-9fc47b502382","block_type":"box","text":"extend the duration of these fixed-income securities, especially mortgage-related securities, making","page_number":95,"box":{"x":116,"y":802,"width":739,"height":12}},{"id":"506f0313-c9d5-460c-a677-f0f7a38da03a","block_type":"box","text":"them more sensitive to changes in interest rates. As a result, in a period of rising interest rates, these","page_number":95,"box":{"x":116,"y":818,"width":750,"height":12}},{"id":"df4b2319-fe82-4cbb-81e9-8a80a32a67ac","block_type":"box","text":"securities may exhibit additional volatility and lose value. This is known as extension risk.","page_number":95,"box":{"x":116,"y":833,"width":665,"height":12}},{"id":"f52634df-75a3-4ea4-af78-8c67d55b220a","block_type":"box","text":"The value of fixed-income securities in the Funds can be expected to vary inversely with changes in","page_number":95,"box":{"x":116,"y":862,"width":745,"height":12}},{"id":"047079ae-9584-4ce1-a4a5-fc9f7ef77ac5","block_type":"box","text":"prevailing interest rates. Fixed-income securities with longer maturities, which tend to produce higher","page_number":95,"box":{"x":117,"y":878,"width":753,"height":11}},{"id":"178a3b82-06e3-4edd-84fc-0af3e72486bd","block_type":"box","text":"II-11","page_number":95,"box":{"x":484,"y":909,"width":29,"height":9}},{"id":"936739db-eee3-493b-bdcd-82790a7e6817","block_type":"box","text":"NM0926U-5926888-95/257","page_number":95,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"5c7007f5-09fe-4ec9-bcb9-bc95e393b210","block_type":"box","text":"yields, are subject to potentially greater capital appreciation and depreciation than securities with","page_number":96,"box":{"x":116,"y":87,"width":723,"height":12}},{"id":"6c86f898-fd38-4da7-9393-4f94c1b33937","block_type":"box","text":"shorter maturities. The Funds are not restricted to any maximum or minimum time to maturity in","page_number":96,"box":{"x":116,"y":103,"width":714,"height":12}},{"id":"476961f9-7099-40e4-901f-997e4094a8bd","block_type":"box","text":"purchasing individual portfolio securities, and the average maturity of a Fund’s assets will vary.","page_number":96,"box":{"x":117,"y":118,"width":707,"height":12}},{"id":"1fda7d40-ba59-49f3-87e0-44b6beb69582","block_type":"box","text":"Floating and Variable Rate Securities","page_number":96,"box":{"x":116,"y":149,"width":277,"height":12}},{"id":"e154af8c-ff94-4a06-aa44-ce53e369482a","block_type":"box","text":". Certain Funds may invest in debt instruments that pay a variable","page_number":96,"box":{"x":395,"y":149,"width":493,"height":12}},{"id":"bbf26382-fe0d-49c1-a127-8e34a24d10b1","block_type":"box","text":"coupon rate. Securities with floating or variable interest rates can be less sensitive to interest rate","page_number":96,"box":{"x":116,"y":165,"width":728,"height":12}},{"id":"4bb79d3b-52a6-4f63-a06e-dc8f68f43fb6","block_type":"box","text":"changes than securities with fixed interest rates, but may decline in value if their interest rates do not","page_number":96,"box":{"x":116,"y":180,"width":752,"height":12}},{"id":"e4d87fc2-5801-41ef-942e-6dcad0e0cd22","block_type":"box","text":"rise as much, or as quickly, as interest rates in general. Conversely, floating rate securities will not","page_number":96,"box":{"x":117,"y":196,"width":732,"height":12}},{"id":"8e5299ad-9de4-4caf-a73f-53d498762fcb","block_type":"box","text":"generally increase in value if interest rates decline. The","page_number":96,"box":{"x":116,"y":211,"width":415,"height":12}},{"id":"3c297dd5-01ae-4f45-8aeb-36134d805a5e","block_type":"box","text":"impact of interest rate changes on floating rate","page_number":96,"box":{"x":532,"y":211,"width":350,"height":12}},{"id":"828adb95-2958-420b-8e1b-560e5b11bc7e","block_type":"box","text":"investments is typically mitigated by the periodic interest rate reset of the investments. Benchmark","page_number":96,"box":{"x":117,"y":227,"width":733,"height":12}},{"id":"e0faff0b-c206-4c1e-b10b-60fb9c395d71","block_type":"box","text":"interest rates used for floating and variable rate securities may not accurately track market interest","page_number":96,"box":{"x":117,"y":242,"width":734,"height":12}},{"id":"068c4ef6-c5ff-4fa2-8788-d9b1fb0ccceb","block_type":"box","text":"rates.","page_number":96,"box":{"x":117,"y":258,"width":45,"height":9}},{"id":"6e780141-88ad-44a7-afa0-aadd2715e45b","block_type":"box","text":"Inflation-Indexed Bonds.","page_number":96,"box":{"x":117,"y":289,"width":179,"height":9}},{"id":"1d6dfc9e-0efd-4d3b-94cc-81ebab98b352","block_type":"box","text":"Certain Funds may invest in inflation-indexed bonds, which are fixed-income","page_number":96,"box":{"x":297,"y":289,"width":577,"height":12}},{"id":"7308d5a2-e5a1-4a27-8292-b2c9b25d114e","block_type":"box","text":"securities or other instruments whose principal value is periodically adjusted according to the rate of","page_number":96,"box":{"x":116,"y":304,"width":746,"height":12}},{"id":"b44caccd-4e41-45ce-8d97-b1fa136facfd","block_type":"box","text":"inflation. Two structures are common. The U.S. Treasury and some other issuers use a structure that","page_number":96,"box":{"x":117,"y":320,"width":755,"height":12}},{"id":"9f74633e-0160-461f-811c-8860c52388d6","block_type":"box","text":"accrues inflation into the principal value of the bond. Most other issuers pay out the Consumer Price","page_number":96,"box":{"x":116,"y":335,"width":747,"height":12}},{"id":"496c7629-dcbe-4463-9d71-6481c9138a50","block_type":"box","text":"Index (“CPI”) accruals as part of a semi-annual coupon.","page_number":96,"box":{"x":117,"y":351,"width":417,"height":12}},{"id":"30893689-b7f5-4ec8-9415-89dc2716d7c7","block_type":"box","text":"Inflation-indexed securities issued by the U.S. Treasury have maturities of five, ten or thirty years,","page_number":96,"box":{"x":117,"y":382,"width":728,"height":12}},{"id":"39ad0238-6f7e-4b64-8cd5-427dfb0e77b8","block_type":"box","text":"although it is possible that securities with other maturities will be issued in the future. The U.S.","page_number":96,"box":{"x":116,"y":397,"width":703,"height":12}},{"id":"4f509caf-2139-44a0-ba17-2f223895bb2b","block_type":"box","text":"Treasury securities pay interest on a semi-annual basis, equal to a fixed percentage of the inflation","page_number":96,"box":{"x":116,"y":413,"width":738,"height":12}},{"id":"8a703b60-6207-4a1a-876c-6d2abd1aee60","block_type":"box","text":"adjusted principal amount. For example, if a Fund purchased an inflation-indexed bond with a par","page_number":96,"box":{"x":116,"y":428,"width":727,"height":12}},{"id":"b975101d-fb59-4b29-a7ca-4a775263bfc4","block_type":"box","text":"value of $1,000 and a 3% real rate of return coupon (payable 1.5% semi-annually), and inflation over","page_number":96,"box":{"x":116,"y":443,"width":753,"height":13}},{"id":"fdaa9d21-8107-4bfd-9999-63cb1c07f436","block_type":"box","text":"the first six months was 1%, the mid-year par value of the bond would be $1,010 and the first semi","page_number":96,"box":{"x":116,"y":458,"width":736,"height":13}},{"id":"511f5912-e3bb-4b02-86ae-090085cc2aec","block_type":"box","text":"annual interest payment would be $15.15 ($1,010 times 1.5%). If inflation during the second half of the","page_number":96,"box":{"x":116,"y":474,"width":766,"height":13}},{"id":"801628fe-8783-4f6c-883e-45623ec365b0","block_type":"box","text":"year resulted in the whole year’s inflation equaling 3%, the end-of-year par value of the bond would be","page_number":96,"box":{"x":116,"y":490,"width":764,"height":12}},{"id":"07a29513-1989-4486-8e4f-10db403f1c9d","block_type":"box","text":"$1,030 and the second semi-annual interest payment would be $15.45 ($1,030 times 1.5%).","page_number":96,"box":{"x":116,"y":505,"width":689,"height":13}},{"id":"f6a99471-d7c3-4aff-82a5-9dade9198d6f","block_type":"box","text":"If the periodic adjustment rate measuring inflation falls, the principal value of inflation-indexed bonds","page_number":96,"box":{"x":117,"y":537,"width":747,"height":12}},{"id":"64af6811-46b8-45c6-88b2-8ccd791e923d","block_type":"box","text":"will be adjusted downward, and, consequently, the interest payable on these securities (calculated with","page_number":96,"box":{"x":116,"y":552,"width":769,"height":12}},{"id":"e55c34af-e1bc-453d-931c-6588334dc597","block_type":"box","text":"respect to a smaller principal amount) will be reduced. Repayment of the original bond principal upon","page_number":96,"box":{"x":117,"y":568,"width":754,"height":12}},{"id":"f2d0a66b-7a03-40f8-a1ce-c11e7b61f214","block_type":"box","text":"maturity (as adjusted for inflation) is guaranteed in the case of U.S. Treasury inflation-indexed bonds,","page_number":96,"box":{"x":117,"y":583,"width":755,"height":12}},{"id":"0ad6a54e-fe29-4b61-8c4c-9303550f840b","block_type":"box","text":"even during a period of deflation. However, the current market value of the bonds is not guaranteed,","page_number":96,"box":{"x":116,"y":599,"width":748,"height":12}},{"id":"0fffa4ba-a62b-41ae-8278-1f0637973d08","block_type":"box","text":"and will fluctuate. Certain Funds may also invest in other inflation related bonds which may or may not","page_number":96,"box":{"x":116,"y":614,"width":763,"height":12}},{"id":"267a7efc-6e83-4218-befa-6dfa2188265b","block_type":"box","text":"provide a similar guarantee. If a guarantee of principal is not provided, the adjusted principal value of","page_number":96,"box":{"x":117,"y":630,"width":752,"height":12}},{"id":"01e24cd4-fbdc-4cde-a827-d725a10dd39d","block_type":"box","text":"the bond repaid at maturity may be less than the original principal. In addition, if the Fund purchases","page_number":96,"box":{"x":116,"y":645,"width":749,"height":12}},{"id":"41af2182-2674-401a-9251-1e98b0189031","block_type":"box","text":"inflation-indexed bonds offered by foreign issuers, the rate of inflation measured by the foreign inflation","page_number":96,"box":{"x":117,"y":661,"width":761,"height":12}},{"id":"bc485a44-114e-4f1a-b3e1-d61965ec2392","block_type":"box","text":"index may not be correlated to the rate of inflation in the United States.","page_number":96,"box":{"x":117,"y":676,"width":523,"height":12}},{"id":"20f39a60-00ca-4749-a5a1-99cb3186d7a0","block_type":"box","text":"The value of inflation-indexed bonds is expected to change in response to changes in real interest","page_number":96,"box":{"x":116,"y":707,"width":727,"height":12}},{"id":"37ee72ac-6a99-452e-86ae-4f941b3bb84b","block_type":"box","text":"rates. Real interest rates, in turn, are tied to the relationship between nominal interest rates and the","page_number":96,"box":{"x":117,"y":723,"width":736,"height":12}},{"id":"3182c78a-358a-4916-a8a9-3e552f0e94b0","block_type":"box","text":"rate of inflation. Therefore, if inflation were to rise at a faster rate than nominal interest rates, real","page_number":96,"box":{"x":117,"y":738,"width":717,"height":11}},{"id":"3badf186-c365-43e2-9b0c-1d315d283cc0","block_type":"box","text":"interest rates might decline, leading to an increase in value of inflation-indexed bonds. In contrast, if","page_number":96,"box":{"x":117,"y":754,"width":739,"height":12}},{"id":"7987f828-b60b-4d9f-8cf1-9b31e1e315fb","block_type":"box","text":"nominal interest rates increased at a faster rate than inflation, real interest rates might rise, leading to a","page_number":96,"box":{"x":117,"y":769,"width":764,"height":12}},{"id":"1555469a-2271-47b2-9878-4faeccbb735d","block_type":"box","text":"decrease in value of inflation-indexed bonds. There can be no assurance, however, that the value of","page_number":96,"box":{"x":116,"y":785,"width":745,"height":11}},{"id":"4ff4e8e7-bf63-432b-bdd9-d75dff94c081","block_type":"box","text":"inflation-indexed bonds will be directly correlated to changes in interest rates.","page_number":96,"box":{"x":117,"y":800,"width":570,"height":12}},{"id":"bcafd869-9e8e-4fe7-927e-c200f8d2a909","block_type":"box","text":"While these securities are expected to be protected from long-term inflationary trends, short-term","page_number":96,"box":{"x":116,"y":831,"width":725,"height":12}},{"id":"8a952022-746d-4b11-9321-87c48be8b072","block_type":"box","text":"increases in inflation may lead to a decline in value. If interest rates rise due to reasons other than","page_number":96,"box":{"x":117,"y":847,"width":731,"height":12}},{"id":"86a0eb01-2a5e-4467-81a0-35b90949daa0","block_type":"box","text":"inflation (for example, due to changes in currency exchange rates), investors in these securities may","page_number":96,"box":{"x":117,"y":862,"width":749,"height":12}},{"id":"1f7a4082-5487-475e-b944-d259ee561001","block_type":"box","text":"not be protected to the extent that the increase is not reflected in the bond’s inflation measure.","page_number":96,"box":{"x":117,"y":878,"width":704,"height":12}},{"id":"24198456-ac99-44fc-bfbc-8acbd74785d1","block_type":"box","text":"II-12","page_number":96,"box":{"x":484,"y":909,"width":31,"height":9}},{"id":"5949fb4b-b0b3-47f1-997a-d3a230aa1d5a","block_type":"box","text":"NM0926U-5926888-96/257","page_number":96,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"33b5f843-7eab-460b-9f39-87cf32e58cd4","block_type":"box","text":"In general, the measure used to determine the periodic adjustment of U.S. inflation-indexed bonds is","page_number":97,"box":{"x":117,"y":87,"width":750,"height":12}},{"id":"73ec3a9e-c322-42a2-8192-86d09ae51cc4","block_type":"box","text":"the Consumer Price Index for Urban Consumers (“CPI-U”), which is calculated monthly by the U.S.","page_number":97,"box":{"x":116,"y":102,"width":739,"height":13}},{"id":"5bc40dd8-4779-4151-ade8-1a57a5670724","block_type":"box","text":"Bureau of Labor Statistics. The CPI-U is a measurement of changes in the cost of living, made up of","page_number":97,"box":{"x":117,"y":118,"width":747,"height":12}},{"id":"569b2259-7d48-4ab4-9112-f57e3112d136","block_type":"box","text":"components such as housing, food, transportation and energy. Inflation-indexed bonds issued by a","page_number":97,"box":{"x":116,"y":134,"width":739,"height":12}},{"id":"a734937a-1ccc-482a-a3b3-29e5782c0bad","block_type":"box","text":"foreign government are generally adjusted to reflect a comparable inflation index, calculated by that","page_number":97,"box":{"x":116,"y":149,"width":743,"height":12}},{"id":"a54a300d-1718-4593-9ea3-094ddbc54331","block_type":"box","text":"government. There can be no assurance that the CPI-U or any foreign inflation index will accurately","page_number":97,"box":{"x":116,"y":165,"width":744,"height":12}},{"id":"37ab13e2-2240-42e8-aadd-02095c1d67c5","block_type":"box","text":"measure the real rate of inflation in the prices of goods and services. Moreover, there can be no","page_number":97,"box":{"x":117,"y":180,"width":716,"height":12}},{"id":"ed4e2b78-a4b2-4e16-bffd-355501ea8197","block_type":"box","text":"assurance that the rate of inflation in a foreign country will be correlated to the rate of inflation in the","page_number":97,"box":{"x":116,"y":196,"width":745,"height":12}},{"id":"80ae72a3-024c-406d-b5f2-db064db3e215","block_type":"box","text":"United States.","page_number":97,"box":{"x":117,"y":211,"width":109,"height":10}},{"id":"75cc30a9-911f-42a7-be47-73aaf922eebc","block_type":"box","text":"Any increase in the principal amount of an inflation-indexed bond will be considered taxable ordinary","page_number":97,"box":{"x":116,"y":242,"width":750,"height":12}},{"id":"7aad277f-0781-473e-9db4-f9bb7ca98204","block_type":"box","text":"income, even though investors do not receive their principal until maturity.","page_number":97,"box":{"x":117,"y":258,"width":552,"height":12}},{"id":"956f4c72-fa9d-49d6-9726-c95fa5b9d08e","block_type":"box","text":"Investment Grade Debt Obligations.","page_number":97,"box":{"x":117,"y":289,"width":265,"height":12}},{"id":"180c52f2-2342-4bc2-9d8b-043ee0f9be4b","block_type":"box","text":"Certain Funds may invest in “investment grade securities,” which","page_number":97,"box":{"x":383,"y":289,"width":492,"height":12}},{"id":"c24d289a-8a5c-4166-8fa6-f9291e928ab0","block_type":"box","text":"are securities rated in the four highest rating categories of an NRSRO or deemed to be of equivalent","page_number":97,"box":{"x":116,"y":304,"width":750,"height":12}},{"id":"c3081002-58dd-47da-b409-99aac1e58a8d","block_type":"box","text":"quality by a Fund’s Manager. Certain Funds may invest in debt securities rated Aaa by Moody’s or","page_number":97,"box":{"x":116,"y":320,"width":734,"height":12}},{"id":"2da76886-3d80-4dd5-bc85-4cbb8fd31d64","block_type":"box","text":"AAA by S&P. It should be noted that debt obligations rated in the lowest of the top four ratings (","page_number":97,"box":{"x":116,"y":335,"width":708,"height":12}},{"id":"3b8d9893-efc9-439d-ba19-b6b009fce3b9","block_type":"box","text":"i.e.","page_number":97,"box":{"x":825,"y":335,"width":20,"height":10}},{"id":"55ae44b7-1ae7-4f2f-b182-6f2b37ef8c67","block_type":"box","text":",","page_number":97,"box":{"x":848,"y":343,"width":8,"height":3}},{"id":"92facf55-7dc2-4011-9947-f450a3394e99","block_type":"box","text":"“Baa” by Moody’s or “BBB” by S&P) are considered to have some speculative characteristics and are","page_number":97,"box":{"x":116,"y":351,"width":756,"height":12}},{"id":"8b2f0aeb-34dd-4f97-a1ad-d0c4a3f6c7fa","block_type":"box","text":"more sensitive to economic change than higher rated securities. If an investment grade security of a","page_number":97,"box":{"x":117,"y":366,"width":747,"height":12}},{"id":"1ea91ffb-3f15-4ad1-81d9-c6ac731302cb","block_type":"box","text":"Fund is subsequently downgraded below investment grade, the Fund’s Manager will consider such an","page_number":97,"box":{"x":117,"y":382,"width":761,"height":12}},{"id":"ca55afb1-ea6d-4bb9-ab66-09784f4648b2","block_type":"box","text":"event in determining whether the Fund should continue to hold the security. Subject to its investment","page_number":97,"box":{"x":116,"y":397,"width":752,"height":12}},{"id":"4bfc8c18-30df-46a8-9fea-9e32c4f7090c","block_type":"box","text":"strategies, there is no limit on the amount of such downgraded securities a Fund may hold.","page_number":97,"box":{"x":116,"y":413,"width":679,"height":12}},{"id":"bb28e616-21fc-4dbd-8c99-3c951816221d","block_type":"box","text":"See Appendix A to this SAI for a description of applicable securities ratings.","page_number":97,"box":{"x":116,"y":444,"width":566,"height":12}},{"id":"220f3e83-ecc5-4312-aa63-39a3aac3e321","block_type":"box","text":"High Yield Investments (“Junk Bonds”).","page_number":97,"box":{"x":116,"y":475,"width":296,"height":12}},{"id":"5e394a2b-95c4-4cba-8321-2364f9a3625c","block_type":"box","text":"Non-investment grade or “high yield” fixed-income or convertible securities commonly known to","page_number":97,"box":{"x":117,"y":498,"width":711,"height":12}},{"id":"58ba37d6-3ebe-4a86-a5b9-233512ac304d","block_type":"box","text":"investors as “junk bonds” are debt securities that are rated below investment grade by the major rating","page_number":97,"box":{"x":117,"y":513,"width":764,"height":12}},{"id":"657a0bb5-c4fa-4dac-b3ef-6ce160262ac3","block_type":"box","text":"agencies or are securities that Fund management believes are of comparable quality. While generally","page_number":97,"box":{"x":116,"y":529,"width":759,"height":12}},{"id":"a48d597d-0cae-43e3-a40e-b131a0e64134","block_type":"box","text":"providing greater income and opportunity for gain, non-investment grade debt securities may be","page_number":97,"box":{"x":117,"y":544,"width":715,"height":12}},{"id":"56b63cc6-93f5-446a-aed3-cf226aebf2de","block_type":"box","text":"subject to greater risks than securities which have higher credit ratings, including a high risk of default,","page_number":97,"box":{"x":116,"y":560,"width":764,"height":12}},{"id":"0beec72a-a11b-4de0-9517-f45be38a7eeb","block_type":"box","text":"and their yields will fluctuate over time. High yield securities will generally be in the lower rating","page_number":97,"box":{"x":116,"y":575,"width":709,"height":12}},{"id":"b49d9699-2e06-4354-9f56-118375b6375e","block_type":"box","text":"categories of recognized rating agencies (rated “Ba” or lower by Moody’s or “BB” or lower by S&P) or","page_number":97,"box":{"x":116,"y":591,"width":755,"height":12}},{"id":"b330a0af-7216-42e7-8ebb-865dad505383","block_type":"box","text":"will be non-rated. The credit rating of a high yield security does not necessarily address its market","page_number":97,"box":{"x":116,"y":606,"width":730,"height":12}},{"id":"9f902e9e-7636-4fe0-8c61-71a8d43e6540","block_type":"box","text":"value risk, and ratings may from time to time change, positively or negatively, to reflect developments","page_number":97,"box":{"x":116,"y":622,"width":757,"height":12}},{"id":"243c9417-4d41-4918-a597-248ea7fe08b4","block_type":"box","text":"regarding the issuer’s financial condition. High yield securities are considered to be speculative with","page_number":97,"box":{"x":117,"y":637,"width":743,"height":12}},{"id":"7801b2f4-c770-4d7b-8f87-7ea094b7e9ac","block_type":"box","text":"respect to the capacity of the issuer to timely repay principal and pay interest or dividends in","page_number":97,"box":{"x":117,"y":653,"width":687,"height":12}},{"id":"f1b823ea-9790-4c44-b192-7b59978deb1a","block_type":"box","text":"accordance with the terms of the obligation and may have more credit risk than higher rated securities.","page_number":97,"box":{"x":116,"y":668,"width":761,"height":12}},{"id":"4758a72a-19cc-4b60-ac1f-6af272a65fed","block_type":"box","text":"The major risks in junk bond investments include the following:","page_number":97,"box":{"x":116,"y":699,"width":464,"height":13}},{"id":"3648c7bd-e300-4b70-b58e-d90c9a3f5e17","block_type":"box","text":"• Junk bonds may be issued by less creditworthy companies. These securities are vulnerable to","page_number":97,"box":{"x":117,"y":731,"width":731,"height":12}},{"id":"132f3e67-3083-4c40-87b9-e7a845a94ef4","block_type":"box","text":"adverse changes in the issuer’s industry and to general economic conditions. Issuers of junk","page_number":97,"box":{"x":150,"y":746,"width":686,"height":12}},{"id":"af08abb8-b250-4f97-8399-686550fddd85","block_type":"box","text":"bonds may be unable to meet their interest or principal payment obligations because of an","page_number":97,"box":{"x":150,"y":761,"width":669,"height":13}},{"id":"6bf5e3cc-7525-40ab-a656-a9a719862397","block_type":"box","text":"economic downturn, specific issuer developments or the unavailability of additional financing.","page_number":97,"box":{"x":150,"y":777,"width":689,"height":12}},{"id":"5444341c-f350-42bb-a766-45104085ecad","block_type":"box","text":"• The issuers of junk bonds may have a larger amount of outstanding debt relative to their assets","page_number":97,"box":{"x":117,"y":800,"width":740,"height":12}},{"id":"6f49fbbb-87f6-470f-a284-54f3ca126ffb","block_type":"box","text":"than issuers of investment grade bonds. If the issuer experiences financial stress, it may be","page_number":97,"box":{"x":150,"y":816,"width":678,"height":12}},{"id":"373d90f4-5f4d-4eb5-a9a7-b7b7c08211aa","block_type":"box","text":"unable to meet its debt obligations. The issuer’s ability to pay its debt obligations also may be","page_number":97,"box":{"x":150,"y":831,"width":697,"height":12}},{"id":"a74c1487-bf60-4985-b163-98a565a2dc23","block_type":"box","text":"lessened by specific issuer developments, or the unavailability of additional financing. Issuers of","page_number":97,"box":{"x":150,"y":847,"width":717,"height":12}},{"id":"4df92937-be13-46e6-99c5-7cd043b88d19","block_type":"box","text":"high yield securities are often in the growth stage of their development and/or involved in a","page_number":97,"box":{"x":150,"y":862,"width":677,"height":12}},{"id":"8710c617-5fd8-457f-be37-7f6f4d7ebc0f","block_type":"box","text":"reorganization or takeover.","page_number":97,"box":{"x":150,"y":878,"width":204,"height":12}},{"id":"f3eb9cc5-6cc7-4df7-ba27-44c857293fec","block_type":"box","text":"II-13","page_number":97,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"104de3c2-e0c6-4218-b83c-cd0cb8ae6d6a","block_type":"box","text":"NM0926U-5926888-97/257","page_number":97,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"c26a7c21-7a84-4119-82cc-c5ffc067786f","block_type":"box","text":"• Junk bonds are frequently ranked junior to claims by other creditors. If the issuer cannot meet its","page_number":98,"box":{"x":117,"y":87,"width":754,"height":12}},{"id":"b7006885-0120-46b4-9e56-417646068287","block_type":"box","text":"obligations, the senior obligations are generally paid off before the junior obligations, which will","page_number":98,"box":{"x":150,"y":102,"width":706,"height":13}},{"id":"4fe25a4d-24bd-4bca-8d52-7ee8ff97cec0","block_type":"box","text":"potentially limit a Fund’s ability to fully recover principal or to receive interest payments when","page_number":98,"box":{"x":150,"y":118,"width":693,"height":12}},{"id":"02567d5a-3094-44fc-bb6e-dd2b1da122bb","block_type":"box","text":"senior securities are in default. Thus, investors in high yield securities have a lower degree of","page_number":98,"box":{"x":150,"y":134,"width":696,"height":12}},{"id":"4af81fc9-e0c9-44f6-85ec-ab27f5339d5e","block_type":"box","text":"protection with respect to principal and interest payments than do investors in higher rated","page_number":98,"box":{"x":150,"y":149,"width":674,"height":12}},{"id":"4d0b3cfe-4d20-4f9a-a0cd-cf7a924754b4","block_type":"box","text":"securities.","page_number":98,"box":{"x":150,"y":165,"width":80,"height":9}},{"id":"2757a97d-6f6d-452b-9025-23231f920de5","block_type":"box","text":"• Junk bonds frequently have redemption features that permit an issuer to repurchase the security","page_number":98,"box":{"x":117,"y":188,"width":753,"height":12}},{"id":"b23a4a80-9134-42a7-8d8a-83726f5b7019","block_type":"box","text":"from a Fund before it matures. If an issuer redeems the junk bonds, a Fund may have to invest the","page_number":98,"box":{"x":149,"y":203,"width":738,"height":12}},{"id":"97aaebd7-13bc-46e1-8bc3-9395fb6ba179","block_type":"box","text":"proceeds in bonds with lower yields and may lose income.","page_number":98,"box":{"x":150,"y":219,"width":437,"height":12}},{"id":"2e4c7cb5-934f-43dc-9b44-69c321259a23","block_type":"box","text":"• Prices of junk bonds are subject to extreme price fluctuations. Negative economic developments","page_number":98,"box":{"x":117,"y":242,"width":753,"height":12}},{"id":"80795ac2-02d6-4a61-a371-7901a894b3b1","block_type":"box","text":"may have a greater impact on the prices of junk bonds than on those of other higher rated fixed","page_number":98,"box":{"x":150,"y":258,"width":713,"height":12}},{"id":"d88251a1-9931-4032-96ae-9343c54af63d","block_type":"box","text":"income securities.","page_number":98,"box":{"x":150,"y":273,"width":139,"height":10}},{"id":"7d43f11f-5f1e-4734-a185-83a9ac61657b","block_type":"box","text":"• Junk bonds may be less liquid than higher rated fixed-income securities even under normal","page_number":98,"box":{"x":117,"y":296,"width":714,"height":12}},{"id":"10a9cf1e-7373-429c-9feb-1d12993c7afd","block_type":"box","text":"economic conditions. Under certain economic and/or market conditions, a Fund may have difficulty","page_number":98,"box":{"x":150,"y":312,"width":738,"height":12}},{"id":"40072a47-5c96-42ce-9d8e-9f51961e0b13","block_type":"box","text":"disposing of certain high yield securities due to the limited number of investors in that sector of the","page_number":98,"box":{"x":150,"y":327,"width":734,"height":12}},{"id":"06742b2f-1b09-4ee8-b1d8-d19a47e2a077","block_type":"box","text":"market. There are fewer dealers in the junk bond market, and there may be significant differences","page_number":98,"box":{"x":150,"y":343,"width":730,"height":12}},{"id":"9847ab7d-f621-47a6-bc99-37513f06c18c","block_type":"box","text":"in the prices quoted for junk bonds by the dealers, and such quotations may not be the actual","page_number":98,"box":{"x":150,"y":358,"width":698,"height":12}},{"id":"cd8dbda8-1a7c-4b7c-bbd2-dfd1483579b9","block_type":"box","text":"prices available for a purchase or sale. Because junk bonds are less liquid than higher rated","page_number":98,"box":{"x":150,"y":374,"width":688,"height":12}},{"id":"ad04a3af-d44a-42d0-968d-84e9b0457838","block_type":"box","text":"bonds, judgment may play a greater role in valuing certain of a Fund’s portfolio securities than in","page_number":98,"box":{"x":150,"y":389,"width":720,"height":12}},{"id":"b1d2a80b-03ca-4a14-996a-c4fea24509fb","block_type":"box","text":"the case of securities trading in a more liquid market.","page_number":98,"box":{"x":150,"y":405,"width":398,"height":12}},{"id":"1c4e9f8d-6c9d-41f0-9b7b-0b9acada6fc6","block_type":"box","text":"• The secondary markets for high yield securities are not as liquid as the secondary markets for","page_number":98,"box":{"x":117,"y":428,"width":734,"height":12}},{"id":"e14a3b4a-26e6-458d-b6b5-c594a4339cdc","block_type":"box","text":"higher rated securities. The secondary markets for high yield securities are concentrated in","page_number":98,"box":{"x":150,"y":444,"width":680,"height":12}},{"id":"3a17c327-5c70-4e29-851c-165ddf096b11","block_type":"box","text":"relatively few market makers and participants in the markets are mostly institutional investors,","page_number":98,"box":{"x":150,"y":459,"width":699,"height":12}},{"id":"18bc2ffb-dcf0-46f9-b29b-6003f7d605ea","block_type":"box","text":"including insurance companies, banks, other financial institutions and mutual funds. In addition,","page_number":98,"box":{"x":150,"y":475,"width":712,"height":12}},{"id":"ffbcb5d5-2b33-4401-9045-38d4982925a1","block_type":"box","text":"the trading volume for high yield securities is generally lower than that for higher rated securities","page_number":98,"box":{"x":150,"y":490,"width":718,"height":12}},{"id":"54ad612c-81a3-4430-bbee-546dca1ee1f7","block_type":"box","text":"and the secondary markets could contract under adverse market or economic conditions","page_number":98,"box":{"x":150,"y":506,"width":662,"height":12}},{"id":"fa6a2fc8-ee7c-4b4c-a6e5-872f87098f90","block_type":"box","text":"independent of any specific adverse changes in the condition of a particular issuer. Under certain","page_number":98,"box":{"x":150,"y":521,"width":725,"height":12}},{"id":"4c1521c9-8816-4dc1-a685-b9fa834995c1","block_type":"box","text":"economic and/or market conditions, a Fund may have difficulty disposing of certain high yield","page_number":98,"box":{"x":150,"y":537,"width":695,"height":12}},{"id":"db7ca56e-9e9c-47a7-8202-438ab270da95","block_type":"box","text":"securities due to the limited number of investors in that sector of the market. An illiquid secondary","page_number":98,"box":{"x":150,"y":552,"width":728,"height":12}},{"id":"6445e1e7-c56a-4ec5-8700-c9f45fe34f64","block_type":"box","text":"market may adversely affect the market price of the high yield security, which may result in","page_number":98,"box":{"x":150,"y":568,"width":678,"height":12}},{"id":"30fe147a-6d56-4601-99db-24b2a15c7051","block_type":"box","text":"increased difficulty selling the particular issue and obtaining accurate market quotations on the","page_number":98,"box":{"x":150,"y":583,"width":706,"height":12}},{"id":"b00a50c2-4269-4865-a6c3-214871822518","block_type":"box","text":"issue when valuing a Fund’s assets. Market quotations on high yield securities are available only","page_number":98,"box":{"x":150,"y":599,"width":722,"height":12}},{"id":"7ba57f13-1c34-49fd-8fe5-a208b8251021","block_type":"box","text":"from a limited number of dealers, and such quotations may not be the actual prices available for a","page_number":98,"box":{"x":149,"y":614,"width":731,"height":12}},{"id":"f8f5b392-b1cf-498b-832b-b4f6a1039841","block_type":"box","text":"purchase or sale. When the secondary market for high yield securities becomes more illiquid, or in","page_number":98,"box":{"x":150,"y":630,"width":734,"height":12}},{"id":"f968d5e6-27b8-462b-bc38-c74305af8d77","block_type":"box","text":"the absence of readily available market quotations for such securities, the relative lack of reliable","page_number":98,"box":{"x":150,"y":645,"width":723,"height":12}},{"id":"d5d95f63-3896-4a4b-bfe9-ffa15e883da8","block_type":"box","text":"objective data makes it more difficult to value a Fund’s securities, and judgment plays a more","page_number":98,"box":{"x":150,"y":661,"width":691,"height":12}},{"id":"785cf9bd-a829-4b2a-84e0-1415c88b8236","block_type":"box","text":"important role in determining such valuations.","page_number":98,"box":{"x":150,"y":676,"width":337,"height":12}},{"id":"f92a4d7e-4215-4cf6-9cbd-a68a9bbe9f37","block_type":"box","text":"• A Fund may incur expenses to the extent necessary to seek recovery upon default or to negotiate","page_number":98,"box":{"x":117,"y":699,"width":757,"height":13}},{"id":"239aedb9-bc6a-4e7c-bd94-ee116b835f2f","block_type":"box","text":"new terms with a defaulting issuer.","page_number":98,"box":{"x":150,"y":715,"width":256,"height":12}},{"id":"01cbe15b-776b-4167-a893-90c7ec9f3435","block_type":"box","text":"• The junk bond markets may react strongly to adverse news about an issuer or the economy, or to","page_number":98,"box":{"x":117,"y":738,"width":756,"height":12}},{"id":"7817f3a0-fefc-46da-afe0-f70878b991cc","block_type":"box","text":"the perception or expectation of adverse news, whether or not it is based on fundamental analysis.","page_number":98,"box":{"x":150,"y":754,"width":731,"height":12}},{"id":"8e30aa48-6ae8-4e8d-9abd-4b3f79889346","block_type":"box","text":"Additionally, prices for high yield securities may be affected by legislative and regulatory","page_number":98,"box":{"x":149,"y":769,"width":654,"height":12}},{"id":"1877c355-c7b8-4a87-9dc7-47a543cc8700","block_type":"box","text":"developments. These developments could adversely affect a Fund’s NAV and investment","page_number":98,"box":{"x":150,"y":785,"width":664,"height":12}},{"id":"a1db15de-6af2-4cf9-8d88-caa081739c10","block_type":"box","text":"practices, the secondary market for high yield securities, the financial condition of issuers of these","page_number":98,"box":{"x":150,"y":800,"width":726,"height":12}},{"id":"54d62af6-ddc6-41c3-b083-8852c920fb4b","block_type":"box","text":"securities and the value and liquidity of outstanding high yield securities, especially in a thinly","page_number":98,"box":{"x":150,"y":816,"width":690,"height":12}},{"id":"51a5ebde-064d-4e39-bfc7-556b0455b834","block_type":"box","text":"traded market. For example, federal legislation requiring the divestiture by federally insured","page_number":98,"box":{"x":150,"y":831,"width":681,"height":12}},{"id":"33a6ec68-1f40-4434-ad6b-bd02a449f5de","block_type":"box","text":"savings and loan associations of their investments in high yield bonds and limiting the deductibility","page_number":98,"box":{"x":150,"y":847,"width":733,"height":12}},{"id":"75f94ff2-e490-4e68-8c67-2b707cf93bf0","block_type":"box","text":"of interest by certain corporate issuers of high yield bonds adversely affected the market in the","page_number":98,"box":{"x":150,"y":862,"width":706,"height":12}},{"id":"fff5f00a-0d83-44b4-b60f-b30f198c320c","block_type":"box","text":"past.","page_number":98,"box":{"x":150,"y":878,"width":41,"height":12}},{"id":"1da78dea-2e2b-4d5d-9750-8ece7e63ed5a","block_type":"box","text":"II-14","page_number":98,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"5cc37965-0ec2-4238-8269-0a4569eb22e9","block_type":"box","text":"NM0926U-5926888-98/257","page_number":98,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"38dc0f3f-b892-422b-88ed-f795edc5fa11","block_type":"box","text":"• The rating assigned by a rating agency evaluates the issuing agency’s assessment of the safety of","page_number":99,"box":{"x":117,"y":87,"width":770,"height":12}},{"id":"e70484cd-ecb1-4b73-b1c7-dd4426b948db","block_type":"box","text":"a non-investment grade security’s principal and interest payments, but does not address market","page_number":99,"box":{"x":150,"y":103,"width":716,"height":12}},{"id":"fc56d30c-718a-4daf-b5a7-5531ff77823d","block_type":"box","text":"value risk. Because such ratings of the ratings agencies may not always reflect current conditions","page_number":99,"box":{"x":150,"y":118,"width":728,"height":12}},{"id":"ccf7d1d1-c452-4fdd-9c39-dae939f03a67","block_type":"box","text":"and events, in addition to using recognized rating agencies and other sources, the Manager or","page_number":99,"box":{"x":150,"y":134,"width":705,"height":12}},{"id":"deb6e015-62f9-4c91-b310-e48cb336fd3f","block_type":"box","text":"sub-adviser performs its own analysis of the issuers whose non-investment grade securities a","page_number":99,"box":{"x":150,"y":149,"width":700,"height":12}},{"id":"733861f6-275d-4420-abde-a70519f652e8","block_type":"box","text":"Fund holds. Because of this, the Fund’s performance may depend more on the Manager’s or","page_number":99,"box":{"x":151,"y":165,"width":693,"height":12}},{"id":"40a2ffe6-071a-4ecb-b169-fa6bb79e4be8","block_type":"box","text":"sub-adviser’s own credit analysis than in the case of mutual funds investing in higher-rated","page_number":99,"box":{"x":150,"y":180,"width":678,"height":12}},{"id":"947868a7-e420-437f-a00e-9769d4bf2379","block_type":"box","text":"securities.","page_number":99,"box":{"x":150,"y":196,"width":80,"height":9}},{"id":"c6f32315-8813-4db1-94ea-3770e7324a86","block_type":"box","text":"In selecting non-investment grade securities, the Manager or sub-adviser considers factors such as","page_number":99,"box":{"x":117,"y":227,"width":742,"height":12}},{"id":"c68b9f02-6c8d-45a6-87b8-5f9909cdda36","block_type":"box","text":"those relating to the creditworthiness of issuers, the ratings and performance of the securities, the","page_number":99,"box":{"x":116,"y":242,"width":731,"height":12}},{"id":"79d39928-8003-46bd-81d8-c1027512d41c","block_type":"box","text":"protections afforded the securities and the diversity of the Fund. The Manager or sub-adviser","page_number":99,"box":{"x":117,"y":258,"width":694,"height":12}},{"id":"79da00c8-99f5-477e-a4a1-d1ce54abe117","block_type":"box","text":"continuously monitors the issuers of non-investment grade securities held by the Fund for their ability","page_number":99,"box":{"x":116,"y":273,"width":755,"height":12}},{"id":"cb04f46e-ec85-49de-aa8e-afb3176e91cc","block_type":"box","text":"to make required principal and interest payments, as well as in an effort to control the liquidity of the","page_number":99,"box":{"x":116,"y":289,"width":746,"height":12}},{"id":"2804709d-9e34-46c6-822f-08b3d866be7d","block_type":"box","text":"Fund so that it can meet redemption requests. If a security’s rating is reduced below the minimum","page_number":99,"box":{"x":117,"y":304,"width":729,"height":12}},{"id":"41e122d5-08c2-48b5-acd6-f2c4a3ba9591","block_type":"box","text":"credit rating that is permitted for a Fund, the Fund’s adviser or sub-adviser will consider whether the","page_number":99,"box":{"x":116,"y":320,"width":745,"height":12}},{"id":"3db94eba-1498-469d-ab7d-09c08b19b15e","block_type":"box","text":"Fund should continue to hold the security.","page_number":99,"box":{"x":117,"y":335,"width":315,"height":12}},{"id":"1632ab21-2858-4ed3-b1ac-a308b574d7c1","block_type":"box","text":"In the event that a Fund investing in high yield securities experiences an unexpected level of net","page_number":99,"box":{"x":117,"y":366,"width":718,"height":12}},{"id":"ad45ec1b-5a91-4e7b-9c02-c7c47a9f2ed7","block_type":"box","text":"redemptions, the Fund could be forced to sell its holdings without regard to the investment merits,","page_number":99,"box":{"x":117,"y":382,"width":729,"height":12}},{"id":"2d47314a-a8d3-4884-bf3e-9dc7cfebf0f8","block_type":"box","text":"thereby decreasing the assets upon which the Fund’s rate of return is based.","page_number":99,"box":{"x":116,"y":397,"width":575,"height":12}},{"id":"ddcb0d1b-cbf8-4170-a1af-822a06205fdd","block_type":"box","text":"The costs attributable to investing in the junk bond markets are usually higher for several reasons,","page_number":99,"box":{"x":116,"y":428,"width":733,"height":12}},{"id":"4c071279-5c8f-483a-b085-87cb08e5c7a5","block_type":"box","text":"such as higher investment research costs and higher commission costs.","page_number":99,"box":{"x":116,"y":444,"width":540,"height":12}},{"id":"f1be752c-63c0-494a-8828-d6792983b62c","block_type":"box","text":"Mezzanine Investments.","page_number":99,"box":{"x":116,"y":475,"width":179,"height":9}},{"id":"c3ccea33-41b0-4a46-840c-63744d08049b","block_type":"box","text":"Certain Funds, consistent with their restrictions on investing in securities of a","page_number":99,"box":{"x":297,"y":475,"width":579,"height":12}},{"id":"76ee68bb-54b8-4d6e-a8af-e3070845b04d","block_type":"box","text":"specific credit quality, may invest in certain high yield securities known as mezzanine investments,","page_number":99,"box":{"x":116,"y":490,"width":735,"height":12}},{"id":"9369561b-b5cd-4c6b-9fd8-861e56ce3147","block_type":"box","text":"which are subordinated debt securities which are generally issued in private placements in connection","page_number":99,"box":{"x":116,"y":506,"width":762,"height":12}},{"id":"67b221a1-ff70-4c7e-9f60-abb3af488863","block_type":"box","text":"with an equity security (","page_number":99,"box":{"x":116,"y":521,"width":175,"height":12}},{"id":"6692d700-b01b-49c3-8048-0aba265b57b9","block_type":"box","text":"e.g.","page_number":99,"box":{"x":292,"y":524,"width":26,"height":9}},{"id":"04fdd3e7-8e63-4ec0-b629-4c48e930ce1f","block_type":"box","text":", with attached warrants). Such mezzanine investments may be issued with","page_number":99,"box":{"x":321,"y":521,"width":563,"height":12}},{"id":"7d8f5580-4e0e-43d6-8f7b-6d1776f2a799","block_type":"box","text":"or without registration rights. Similar to other high yield securities, maturities of mezzanine investments","page_number":99,"box":{"x":116,"y":537,"width":767,"height":12}},{"id":"dac84c41-0be1-4ecd-874b-16d3271d9502","block_type":"box","text":"are typically seven to ten years, but the expected average life is significantly shorter at three to five","page_number":99,"box":{"x":116,"y":552,"width":738,"height":12}},{"id":"e641112e-c433-4a0a-b4a3-bf1ac248dd90","block_type":"box","text":"years. Mezzanine investments are usually unsecured and subordinate to other obligations of the","page_number":99,"box":{"x":116,"y":568,"width":719,"height":12}},{"id":"b6b8eca1-aab6-4f06-b134-6d9bca978ee2","block_type":"box","text":"issuer.","page_number":99,"box":{"x":117,"y":583,"width":53,"height":10}},{"id":"2fea9ef9-424a-404a-9f4d-9c990566091c","block_type":"box","text":"Pay-in-kind Bonds.","page_number":99,"box":{"x":116,"y":614,"width":139,"height":12}},{"id":"5a05521b-8202-461e-8f64-d858f202fb09","block_type":"box","text":"Certain Funds may invest in pay-in-kind, or PIK, bonds. PIK bonds are bonds which","page_number":99,"box":{"x":257,"y":614,"width":631,"height":12}},{"id":"06bd4626-2d34-463b-860b-c8c1d6527b95","block_type":"box","text":"pay interest through the issuance of additional debt or equity securities. Similar to zero coupon","page_number":99,"box":{"x":117,"y":630,"width":706,"height":12}},{"id":"ee3e58ab-10ec-4af0-9dfb-9f15ec055d7e","block_type":"box","text":"obligations, pay-in-kind bonds also carry additional risk as holders of these types of securities realize","page_number":99,"box":{"x":116,"y":645,"width":753,"height":12}},{"id":"0d90c2ff-823e-4c98-baf7-7fc16246c1ea","block_type":"box","text":"no cash until the cash payment date unless a portion of such securities is sold and, if the issuer","page_number":99,"box":{"x":117,"y":661,"width":707,"height":12}},{"id":"2b874ffa-8681-4ffc-bd27-579179be3502","block_type":"box","text":"defaults, a Fund may obtain no return at all on its investment. The market price of pay-in-kind bonds is","page_number":99,"box":{"x":116,"y":676,"width":759,"height":12}},{"id":"333844d5-f29d-40da-91b8-3eaba252cc12","block_type":"box","text":"affected by interest rate changes to a greater extent, and therefore tends to be more volatile, than that","page_number":99,"box":{"x":116,"y":692,"width":758,"height":12}},{"id":"60d04e00-a628-4de3-9539-dca739929d96","block_type":"box","text":"of securities which pay interest in cash. Additionally, current U.S. federal tax law requires the holder of","page_number":99,"box":{"x":116,"y":707,"width":759,"height":12}},{"id":"bef8088a-00c5-417b-b3e7-31bad9b85504","block_type":"box","text":"pay-in-kind bonds to accrue income with respect to these securities prior to the receipt of cash","page_number":99,"box":{"x":117,"y":723,"width":698,"height":12}},{"id":"9cd285aa-f9ba-46a0-af1c-fb7a2c3512d2","block_type":"box","text":"payments. To maintain its qualification as a regulated investment company and avoid liability for U.S.","page_number":99,"box":{"x":117,"y":738,"width":747,"height":12}},{"id":"1fa25279-4c96-4e59-b1b3-c80b3a126c3c","block_type":"box","text":"federal income and excise taxes, each Fund may be required to distribute income accrued with respect","page_number":99,"box":{"x":116,"y":754,"width":765,"height":12}},{"id":"c316218f-ad92-4045-ae37-baf1323da485","block_type":"box","text":"to these securities and may have to dispose of portfolio securities under disadvantageous","page_number":99,"box":{"x":116,"y":769,"width":665,"height":12}},{"id":"96b0a28b-4582-4e88-8bad-131ea8ca2da2","block_type":"box","text":"circumstances in order to generate cash to satisfy these distribution requirements.","page_number":99,"box":{"x":116,"y":785,"width":608,"height":12}},{"id":"e56207dd-51c2-4e9c-894b-09dd7d547075","block_type":"box","text":"Supranational Entities.","page_number":99,"box":{"x":117,"y":816,"width":165,"height":12}},{"id":"539269ac-77f6-4857-b3f4-76e96c728392","block_type":"box","text":"A Fund may invest in debt securities of supranational entities. Examples of","page_number":99,"box":{"x":289,"y":816,"width":555,"height":12}},{"id":"d78bed9c-d2a2-40ce-a710-474a7ca0a365","block_type":"box","text":"such entities include the International Bank for Reconstruction and Development (the World Bank), the","page_number":99,"box":{"x":116,"y":831,"width":766,"height":12}},{"id":"274e613e-9182-4dd2-a20c-0735eca35b2b","block_type":"box","text":"European Steel and Coal Community, the Asian Development Bank and the Inter-American","page_number":99,"box":{"x":117,"y":847,"width":683,"height":12}},{"id":"90676ea1-4562-48ab-baa0-8cfd102541c8","block_type":"box","text":"Development Bank. The government members, or “stockholders,” usually make initial capital","page_number":99,"box":{"x":117,"y":862,"width":691,"height":12}},{"id":"f2e8f6c8-1836-4e2e-b4b6-0c290b5a0eaa","block_type":"box","text":"contributions to the supranational entity and in many cases are committed to make additional capital","page_number":99,"box":{"x":116,"y":878,"width":748,"height":12}},{"id":"1294441a-f874-4bab-8ad9-c3a0b06a7cae","block_type":"box","text":"II-15","page_number":99,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"3488781e-000d-49cc-a642-bd38ed99fca3","block_type":"box","text":"NM0926U-5926888-99/257","page_number":99,"box":{"x":757,"y":969,"width":151,"height":7}},{"id":"fbea96bc-3419-4c46-bd5f-8d3cc5112700","block_type":"box","text":"contributions if the supranational entity is unable to repay its borrowings. There is no guarantee that","page_number":100,"box":{"x":116,"y":87,"width":744,"height":12}},{"id":"2bb9a123-3adc-4ae4-a001-be4e7785673c","block_type":"box","text":"one or more stockholders of a supranational entity will continue to make any necessary additional","page_number":100,"box":{"x":116,"y":102,"width":729,"height":13}},{"id":"c60b9c9e-1dba-4339-bf01-f8ddedc395b4","block_type":"box","text":"capital contributions. If such contributions are not made, the entity may be unable to pay interest or","page_number":100,"box":{"x":116,"y":118,"width":739,"height":12}},{"id":"4d107360-10ea-4dd4-94cb-7d7181c2393d","block_type":"box","text":"repay principal on its debt securities, and a Fund may lose money on such investments.","page_number":100,"box":{"x":117,"y":134,"width":655,"height":12}},{"id":"5801bb38-995f-4e5f-bd21-41f9ce377702","block_type":"box","text":"Depositary Receipts (ADRs, EDRs and GDRs).","page_number":100,"box":{"x":116,"y":167,"width":367,"height":12}},{"id":"1c66eeac-3972-42c1-98bd-7b7277cbcaa7","block_type":"box","text":"Certain Funds may invest in the securities of foreign","page_number":100,"box":{"x":484,"y":167,"width":397,"height":12}},{"id":"e130a152-bce3-4201-9171-aa001cf8d40d","block_type":"box","text":"issuers in the form of Depositary Receipts or other securities convertible into securities of foreign","page_number":100,"box":{"x":117,"y":182,"width":722,"height":12}},{"id":"5de9c8b8-f246-4477-8c9f-cb3f89df637f","block_type":"box","text":"issuers. Depositary Receipts may not necessarily be denominated in the same currency as the","page_number":100,"box":{"x":117,"y":198,"width":707,"height":12}},{"id":"c111cf14-9e67-4d62-98dc-afff12e3dfae","block_type":"box","text":"underlying securities into which they may be converted. The Fund may invest in both sponsored and","page_number":100,"box":{"x":117,"y":213,"width":749,"height":12}},{"id":"dda6149d-aa83-4845-9e4b-7c96fa085331","block_type":"box","text":"unsponsored American Depositary Receipts (“ADRs”), European Depositary Receipts (“EDRs”), Global","page_number":100,"box":{"x":117,"y":229,"width":769,"height":12}},{"id":"ae216fee-9749-4b0b-b20e-dc14155492fa","block_type":"box","text":"Depositary Receipts (“GDRs”) and other similar global instruments. ADRs typically are issued by an","page_number":100,"box":{"x":117,"y":244,"width":743,"height":12}},{"id":"42873a17-5859-4a11-ba54-184d6cb4901f","block_type":"box","text":"American bank or trust company and evidence ownership of underlying securities issued by a foreign","page_number":100,"box":{"x":116,"y":260,"width":756,"height":12}},{"id":"9f8f51ca-23a5-4caf-9a9c-8a755d9584f4","block_type":"box","text":"corporation. EDRs, which are sometimes referred to as Continental Depositary Receipts, are receipts","page_number":100,"box":{"x":116,"y":275,"width":757,"height":12}},{"id":"feaf1511-f8ac-45c3-8a79-666059775480","block_type":"box","text":"issued in Europe, typically by foreign banks and trust companies, that evidence ownership of either","page_number":100,"box":{"x":117,"y":291,"width":739,"height":12}},{"id":"6d10d5b6-ab2f-4f49-95f6-b9bbc2cbc4e4","block_type":"box","text":"foreign or domestic underlying securities. GDRs are depositary receipts structured like global debt","page_number":100,"box":{"x":116,"y":306,"width":732,"height":12}},{"id":"30723dea-c48d-4e5b-85aa-5d2a8ed0cd03","block_type":"box","text":"issues to facilitate trading on an international basis. In addition to investment risks associated with the","page_number":100,"box":{"x":117,"y":322,"width":758,"height":12}},{"id":"8fb18711-7c62-4b29-b986-796467ea6e9d","block_type":"box","text":"underlying issuer, Depositary Receipts expose a Fund to additional risks associated with the","page_number":100,"box":{"x":117,"y":337,"width":689,"height":12}},{"id":"27e83bb7-39e1-4fed-a27b-270e1951cb09","block_type":"box","text":"non-uniform terms that apply to Depositary Receipt programs, credit exposure to the depository bank","page_number":100,"box":{"x":117,"y":353,"width":754,"height":12}},{"id":"d171db26-7b59-49b0-b5a8-641b79675f73","block_type":"box","text":"and to the sponsors and other parties with whom the depository bank establishes the programs,","page_number":100,"box":{"x":116,"y":368,"width":716,"height":12}},{"id":"5927e514-4d77-4c40-8709-4de3caf3561d","block_type":"box","text":"currency risk and the risk of an illiquid market for Depositary Receipts. Unsponsored ADR, EDR and","page_number":100,"box":{"x":116,"y":384,"width":748,"height":12}},{"id":"75c8bc03-03b0-408b-bcd1-b2953f7fb29f","block_type":"box","text":"GDR programs are organized independently and without the cooperation of the issuer of the underlying","page_number":100,"box":{"x":117,"y":399,"width":771,"height":12}},{"id":"8baec554-0e87-4e69-b7b2-bfe5978b713a","block_type":"box","text":"securities. Unsponsored programs generally expose investors to greater risks than sponsored","page_number":100,"box":{"x":116,"y":415,"width":701,"height":12}},{"id":"558f7525-bb50-4cbe-8250-bf1fade5d2ca","block_type":"box","text":"programs and do not provide holders with many of the shareholder benefits that come from investing in","page_number":100,"box":{"x":117,"y":430,"width":769,"height":12}},{"id":"a7407346-f355-4b05-9ca1-7b5d46cec774","block_type":"box","text":"a sponsored Depositary Receipt. Available information concerning the issuer may not be as current as","page_number":100,"box":{"x":116,"y":446,"width":764,"height":12}},{"id":"eec1d739-48c4-460e-acb4-2b98bdeb12bd","block_type":"box","text":"for sponsored ADRs, EDRs and GDRs, and the prices of unsponsored ADRs, EDRs and GDRs may","page_number":100,"box":{"x":116,"y":461,"width":750,"height":12}},{"id":"e428114e-1fe3-43db-8055-411c28e51328","block_type":"box","text":"be more volatile than if such instruments were sponsored by the issuer. Depositary Receipts are","page_number":100,"box":{"x":117,"y":477,"width":718,"height":12}},{"id":"7715e301-0bfe-4297-a3f9-6353dd4cf3b7","block_type":"box","text":"generally subject to the same risks as the foreign securities that they evidence or into which they may","page_number":100,"box":{"x":116,"y":492,"width":759,"height":12}},{"id":"77bef90f-a6a2-4807-8435-d1516e64cd27","block_type":"box","text":"be converted. Investments in ADRs, EDRs and GDRs present additional investment considerations as","page_number":100,"box":{"x":117,"y":508,"width":763,"height":12}},{"id":"8929c252-ae67-4f2a-b7c5-aa75cf707e61","block_type":"box","text":"described under “Foreign Investment Risks.”","page_number":100,"box":{"x":116,"y":523,"width":336,"height":12}},{"id":"ff528032-a5cf-4070-be4a-87a41bd1f40f","block_type":"box","text":"Derivatives.","page_number":100,"box":{"x":116,"y":557,"width":99,"height":9}},{"id":"4535b1f5-273e-4754-b526-7f6cc0a8960e","block_type":"box","text":"General.","page_number":100,"box":{"x":117,"y":581,"width":68,"height":9}},{"id":"ae23c55e-ad42-4a87-9456-25681f30122d","block_type":"box","text":"Each Fund may use instruments referred to as derivatives, which are financial instruments","page_number":100,"box":{"x":186,"y":581,"width":675,"height":12}},{"id":"1bc3af9e-0be8-49f2-a318-979290c02343","block_type":"box","text":"that derive their value from one or more securities, commodities (such as gold or oil), currencies,","page_number":100,"box":{"x":116,"y":596,"width":722,"height":12}},{"id":"16824d71-4b5a-49ac-845a-27665e64f001","block_type":"box","text":"interest rates, credit events or indices (a measure of value or rates, such as the S&P 500 Index or the","page_number":100,"box":{"x":117,"y":612,"width":758,"height":12}},{"id":"eaa10f92-b530-43a8-96a1-c0ce041c6776","block_type":"box","text":"prime lending rate) or other reference asset. Derivatives may allow a Fund to increase or decrease the","page_number":100,"box":{"x":117,"y":627,"width":765,"height":12}},{"id":"b07171ae-4942-46e2-b4c0-cc2d1e89e2fe","block_type":"box","text":"level of risk to which the Fund is exposed more quickly and efficiently than with other transactions.","page_number":100,"box":{"x":117,"y":643,"width":732,"height":12}},{"id":"c56cf9ec-1039-4072-8787-2bccba96ff9e","block_type":"box","text":"Certain Funds may use derivatives to maintain a portion of their long and short positions. Unless","page_number":100,"box":{"x":117,"y":658,"width":719,"height":12}},{"id":"f7028926-23c1-43b3-b43c-456f2316d0d6","block_type":"box","text":"otherwise permitted, no Fund may use derivatives to gain exposure to an asset or asset class it is","page_number":100,"box":{"x":116,"y":674,"width":724,"height":12}},{"id":"140702eb-eab3-4ebb-a4ca-d710c5046f83","block_type":"box","text":"prohibited by its investment restrictions from purchasing directly. As described below, derivatives can","page_number":100,"box":{"x":117,"y":689,"width":748,"height":12}},{"id":"5ec27e91-2c88-4629-acf5-82e3c3ffecc1","block_type":"box","text":"be used for hedging or speculative purposes. Funds will engage in transaction-level payment netting,","page_number":100,"box":{"x":117,"y":705,"width":747,"height":12}},{"id":"bdd3393f-44d5-485e-bce6-f1c2a8ef0990","block_type":"box","text":"i.e.","page_number":100,"box":{"x":116,"y":721,"width":20,"height":9}},{"id":"431b9f38-f83b-42f7-845a-317a81489620","block_type":"box","text":", the payment obligations of derivatives contracts are netted against one another with the Fund","page_number":100,"box":{"x":140,"y":720,"width":701,"height":12}},{"id":"5976f396-5a6b-4d5e-8513-a60f0623f110","block_type":"box","text":"receiving or paying, as the case may be, only the net amount of the two payment streams.","page_number":100,"box":{"x":117,"y":736,"width":667,"height":12}},{"id":"fac51be8-923c-4179-a9f5-f3a5c63bceb6","block_type":"box","text":"Hedging.","page_number":100,"box":{"x":116,"y":769,"width":65,"height":12}},{"id":"f9cd8903-78b7-4d4f-acdc-21037242bffd","block_type":"box","text":"Each Fund may use derivatives for hedging purposes, in which a derivative is used to offset","page_number":100,"box":{"x":189,"y":769,"width":680,"height":12}},{"id":"ac9c459e-fbc3-4f0d-9b7e-0ba416e9433c","block_type":"box","text":"the risks associated with other Fund holdings. Losses on other investments may be substantially","page_number":100,"box":{"x":116,"y":785,"width":716,"height":12}},{"id":"050d2b53-3c0a-42b5-8e72-675ef27daa51","block_type":"box","text":"reduced by gains on a derivative that reacts in an opposite manner to market movements. Although","page_number":100,"box":{"x":117,"y":800,"width":737,"height":12}},{"id":"2abdf861-6098-42c7-92b1-d1822e761fd5","block_type":"box","text":"hedging may reduce losses, it may also reduce or eliminate gains. In addition, hedging may cause","page_number":100,"box":{"x":117,"y":816,"width":728,"height":12}},{"id":"866b9953-f00b-444d-ae96-8debf17ba675","block_type":"box","text":"losses if the market moves in an unanticipated manner, or if the cost of the derivative outweighs the","page_number":100,"box":{"x":117,"y":831,"width":744,"height":12}},{"id":"b197bf4f-1752-43d0-b884-c5feb3d4e6f4","block_type":"box","text":"benefit of the hedge. The effectiveness of hedging may be reduced by correlation risk,","page_number":100,"box":{"x":117,"y":847,"width":643,"height":12}},{"id":"be838c09-ab10-432f-bac1-0b68cb6ff23a","block_type":"box","text":"i.e.","page_number":100,"box":{"x":761,"y":847,"width":20,"height":9}},{"id":"2a632fc4-be4e-48bc-bb62-7e1b6e1edb81","block_type":"box","text":",","page_number":100,"box":{"x":784,"y":855,"width":2,"height":3}},{"id":"9f2e1eb8-9699-4f72-b8d4-dd69a6128850","block_type":"box","text":"the risk that","page_number":100,"box":{"x":793,"y":847,"width":91,"height":9}},{"id":"c94b30a0-729c-46b3-ba7a-64ea1ac4d4aa","block_type":"box","text":"changes in the value of the derivative will not match those of the holdings being hedged as expected","page_number":100,"box":{"x":116,"y":862,"width":751,"height":12}},{"id":"21868b08-4684-4512-bb3a-330f5f5b8b24","block_type":"box","text":"by a Fund, which may result in additional losses to the Fund. The inability to close or offset derivatives","page_number":100,"box":{"x":117,"y":878,"width":762,"height":12}},{"id":"c34b88dc-fc5e-43fc-bce7-c18f11cd4d5d","block_type":"box","text":"II-16","page_number":100,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"e4a4c527-0ac4-472a-82ea-a4b2b117f836","block_type":"box","text":"NM0926U-5926888-100/257","page_number":100,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"fe75d0e9-042f-4115-a36b-fa211529458b","block_type":"box","text":"could also reduce the effectiveness of a Fund’s hedging. There is no assurance that a Fund’s hedging","page_number":101,"box":{"x":116,"y":87,"width":762,"height":12}},{"id":"ce65015a-c69e-4d97-81df-0431f7f65549","block_type":"box","text":"will be effective. No Fund is required to use derivatives to hedge.","page_number":101,"box":{"x":116,"y":102,"width":486,"height":13}},{"id":"5f0f925c-6f73-4abd-ac0c-9dcf1943dbc4","block_type":"box","text":"Speculation.","page_number":101,"box":{"x":117,"y":132,"width":90,"height":12}},{"id":"1ca22858-bb27-49e6-8642-2f13dd0988d2","block_type":"box","text":"Certain Funds may also use derivatives for speculative purposes to seek to enhance","page_number":101,"box":{"x":208,"y":132,"width":638,"height":13}},{"id":"def6e302-0c0f-45d2-aa38-69e7c9cd5924","block_type":"box","text":"returns. The use of a derivative is speculative if the Fund is primarily seeking to achieve gains, rather","page_number":101,"box":{"x":117,"y":148,"width":753,"height":12}},{"id":"49c05427-3ff4-4c38-a1eb-6cbcacf4f927","block_type":"box","text":"than offset the risk of other positions. To the extent a Fund invests in a derivative for speculative","page_number":101,"box":{"x":116,"y":163,"width":719,"height":12}},{"id":"a95d1087-a0c6-486f-9f0d-8c36cf2ec2e6","block_type":"box","text":"purposes, the Fund will be fully exposed to the risks of loss of that derivative, which may sometimes be","page_number":101,"box":{"x":117,"y":179,"width":769,"height":12}},{"id":"7d417506-8991-491a-a287-5b990c07bbbc","block_type":"box","text":"greater than the derivative’s cost, and the potential for loss in certain cases may be unlimited.","page_number":101,"box":{"x":116,"y":194,"width":699,"height":13}},{"id":"cdef2e7c-34e5-4dee-a1e5-85532bcf5c58","block_type":"box","text":"Regulation of Derivatives.","page_number":101,"box":{"x":116,"y":224,"width":196,"height":12}},{"id":"d9765ecf-c883-40e2-af2a-66b9e489e3b4","block_type":"box","text":"Rule 18f-4 Under the Investment Company Act.","page_number":101,"box":{"x":116,"y":247,"width":352,"height":12}},{"id":"d4d1177a-b598-4473-a616-5b9ab3866774","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits","page_number":101,"box":{"x":469,"y":247,"width":416,"height":12}},{"id":"c77bcf74-25a6-4fad-83c3-9c9f3c5a9fdb","block_type":"box","text":"a Fund to enter into Derivatives Transactions (as defined below) and certain other transactions","page_number":101,"box":{"x":116,"y":263,"width":708,"height":12}},{"id":"9cdedafa-df86-4124-8491-277cdf466329","block_type":"box","text":"notwithstanding the restrictions on the issuance of “senior securities” under Section 18 of the","page_number":101,"box":{"x":117,"y":278,"width":692,"height":12}},{"id":"79694c0e-729e-4447-8993-23dec4faebd0","block_type":"box","text":"Investment Company Act. Section 18 of the Investment Company Act, among other things, prohibits","page_number":101,"box":{"x":117,"y":294,"width":747,"height":12}},{"id":"87ebb678-2a4b-4fa8-865b-adc2eed21b07","block_type":"box","text":"open-end funds, including the Funds, from issuing or selling any “senior security,” other than borrowing","page_number":101,"box":{"x":116,"y":309,"width":769,"height":12}},{"id":"98b59d42-9b93-49b1-aa75-481a7947085f","block_type":"box","text":"from a bank (subject to a requirement to maintain 300% “asset coverage”).","page_number":101,"box":{"x":116,"y":325,"width":560,"height":12}},{"id":"ac2c8957-6ea1-482d-881f-ec27aa27a55b","block_type":"box","text":"Under Rule 18f-4, “Derivatives Transactions” include the following: (1) any swap, security-based swap","page_number":101,"box":{"x":117,"y":354,"width":761,"height":13}},{"id":"4569e69d-feec-438d-855f-f221e6503665","block_type":"box","text":"(including a contract for differences), futures contract, forward contract, option (excluding purchased","page_number":101,"box":{"x":117,"y":370,"width":747,"height":12}},{"id":"58325ac0-5b7d-4e2a-a097-1142e904bf18","block_type":"box","text":"options), any combination of the foregoing, or any similar instrument, under which a Fund is or may be","page_number":101,"box":{"x":116,"y":385,"width":764,"height":13}},{"id":"7718a6cd-03a5-43a2-9997-dd85371e9149","block_type":"box","text":"required to make any payment or delivery of cash or other assets during the life of the instrument or at","page_number":101,"box":{"x":117,"y":401,"width":763,"height":12}},{"id":"45333ef4-984b-4d48-931d-fd24af5300c6","block_type":"box","text":"maturity or early termination, whether as margin or settlement payment or otherwise; (2) any short sale","page_number":101,"box":{"x":117,"y":416,"width":767,"height":13}},{"id":"e9855f09-4c0a-4817-a26a-746f20de1dc6","block_type":"box","text":"borrowing; (3) reverse repurchase agreements and similar financing transactions (e.g., recourse and","page_number":101,"box":{"x":117,"y":432,"width":750,"height":12}},{"id":"82ea0017-5e58-4205-9cc4-dbe7c87c79de","block_type":"box","text":"non-recourse tender option bonds, and borrowed bonds), if a Fund elects to treat all of these","page_number":101,"box":{"x":117,"y":447,"width":691,"height":13}},{"id":"901a4a39-7700-474e-b9cc-a7244a50d9df","block_type":"box","text":"transactions as Derivatives Transactions under Rule 18f-4; and (4) when-issued or forward-settling","page_number":101,"box":{"x":116,"y":463,"width":738,"height":12}},{"id":"c1e9727c-117c-4876-b686-4f0e29cc87c2","block_type":"box","text":"securities (e.g., firm and standby commitments, including to-be-announced (“TBA”) commitments, and","page_number":101,"box":{"x":116,"y":478,"width":763,"height":13}},{"id":"61151bb5-d87b-4e10-8625-33c20cfdd82b","block_type":"box","text":"dollar rolls) and non-standard settlement cycle securities, unless such transactions meet the Delayed","page_number":101,"box":{"x":116,"y":494,"width":755,"height":12}},{"id":"07642488-7d03-4358-8bf2-8d0795d09c5d","block_type":"box","text":"Settlement Securities Provision (as defined below under “— When-Issued Securities, Delayed Delivery","page_number":101,"box":{"x":116,"y":509,"width":768,"height":13}},{"id":"124369c9-e374-4bcf-a179-ecf46fc1e4ec","block_type":"box","text":"Securities and Forward Commitments”).","page_number":101,"box":{"x":116,"y":525,"width":302,"height":12}},{"id":"cf89e1f7-3d70-4da7-9724-d903db001ea6","block_type":"box","text":"Unless a Fund is relying on the Limited Derivatives User Exception (as defined below), the Fund must","page_number":101,"box":{"x":117,"y":555,"width":759,"height":12}},{"id":"cf4864d1-f6b0-4784-87fc-7f55ee51cb08","block_type":"box","text":"comply with Rule 18f-4 with respect to its Derivatives Transactions. Rule 18f-4, among other things,","page_number":101,"box":{"x":116,"y":570,"width":744,"height":12}},{"id":"3baf3921-5c77-4f75-864d-4e30a0c076e6","block_type":"box","text":"requires a Fund to adopt and implement a comprehensive written derivatives risk management","page_number":101,"box":{"x":117,"y":586,"width":708,"height":12}},{"id":"f653742c-1eed-49c5-98d1-18c653b1fca7","block_type":"box","text":"program (“DRMP”) and comply with a relative or absolute limit on Fund leverage risk calculated based","page_number":101,"box":{"x":117,"y":601,"width":761,"height":13}},{"id":"7d0677c4-3635-4e9e-a588-1c55bd9c133c","block_type":"box","text":"on value-at-risk (“VaR”). The DRMP is administered by a “derivatives risk manager,” who is appointed","page_number":101,"box":{"x":116,"y":617,"width":760,"height":12}},{"id":"628c5777-97a1-4526-8a37-c710c2091e24","block_type":"box","text":"by the Fund’s Board, including a majority of the independent Directors, and periodically reviews the","page_number":101,"box":{"x":117,"y":632,"width":739,"height":13}},{"id":"b67f3b66-d283-4715-8b5d-8010a4fa6ab0","block_type":"box","text":"DRMP and reports to the Fund’s Board.","page_number":101,"box":{"x":117,"y":648,"width":299,"height":12}},{"id":"6995b016-1505-4fc1-91cb-63487bf7ab8f","block_type":"box","text":"Rule 18f-4 provides an exception from the DRMP, VaR limit and certain other requirements if a Fund’s","page_number":101,"box":{"x":117,"y":678,"width":758,"height":12}},{"id":"bb15bdb5-8215-4c98-87a4-dca802c74952","block_type":"box","text":"“derivatives exposure” is limited to 10% of its net assets (as calculated in accordance with Rule 18f-4)","page_number":101,"box":{"x":116,"y":693,"width":754,"height":12}},{"id":"8c1b4b04-53ae-4a1b-a120-0e100909d275","block_type":"box","text":"and the Fund adopts and implements written policies and procedures reasonably designed to manage","page_number":101,"box":{"x":116,"y":709,"width":758,"height":12}},{"id":"c2d3a4d8-a8e8-435a-bc4c-7a227f8c66ce","block_type":"box","text":"its derivatives risks (the “Limited Derivatives User Exception”).","page_number":101,"box":{"x":117,"y":724,"width":459,"height":12}},{"id":"e838288f-d8da-42b5-9dca-cc813895cd07","block_type":"box","text":"Dodd-Frank Regulations.","page_number":101,"box":{"x":116,"y":754,"width":185,"height":12}},{"id":"88ebc617-29d0-4c4a-b7a2-7a8d2dcca412","block_type":"box","text":"The Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd","page_number":101,"box":{"x":308,"y":754,"width":555,"height":12}},{"id":"a042c4af-c9d7-4bc1-8c17-5379f4b75d31","block_type":"box","text":"Frank”), enacted in July 2010, includes provisions that comprehensively regulate the over-the-counter","page_number":101,"box":{"x":117,"y":770,"width":754,"height":12}},{"id":"57efeacd-3825-488f-b30b-4ce47e68ca0d","block_type":"box","text":"(“OTC”) derivatives markets for the first time. While the Commodity Futures Trading Commission","page_number":101,"box":{"x":117,"y":785,"width":716,"height":12}},{"id":"478ca5ab-b325-4952-9535-f0a24fef6e8b","block_type":"box","text":"(“CFTC”) and other U.S. regulators have adopted many of the required Dodd-Frank regulations, certain","page_number":101,"box":{"x":117,"y":801,"width":764,"height":12}},{"id":"4d0c6229-3932-4b44-b22b-5d2b8ca14e8a","block_type":"box","text":"regulations have only recently become effective and other regulations remain to be adopted. The full","page_number":101,"box":{"x":117,"y":816,"width":743,"height":12}},{"id":"95ed7e36-9a5a-4f40-81e8-7700f62cab9d","block_type":"box","text":"impact of Dodd-Frank on the Funds remains uncertain.","page_number":101,"box":{"x":117,"y":832,"width":411,"height":12}},{"id":"a9c863ad-9c79-482a-b58d-02f9a5f700e8","block_type":"box","text":"Many OTC derivatives dealers are required to register with the CFTC as “swap dealers” and/or with the","page_number":101,"box":{"x":117,"y":862,"width":770,"height":12}},{"id":"94902243-f977-4af7-8a97-addba212fd47","block_type":"box","text":"SEC as “security-based swap dealers”. Registered swap dealers and security-based swap dealers are","page_number":101,"box":{"x":116,"y":877,"width":765,"height":12}},{"id":"27bffc1b-7744-487c-a4fc-3d713eca0c2a","block_type":"box","text":"II-17","page_number":101,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"46a04326-7cf0-4e94-86a5-6b75b781c833","block_type":"box","text":"NM0926U-5926888-101/257","page_number":101,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"235b146e-4bf9-4865-91dd-7a695aa8fd0c","block_type":"box","text":"subject to various regulatory requirements, including, but not limited to, margin, recordkeeping,","page_number":102,"box":{"x":116,"y":87,"width":708,"height":12}},{"id":"5691defa-8841-4511-89f3-e607b11b681a","block_type":"box","text":"reporting, transparency, position limits, limitations on conflicts of interest, business conduct standards,","page_number":102,"box":{"x":117,"y":102,"width":761,"height":13}},{"id":"bb8630da-0efc-4622-b417-e15e3fa54472","block_type":"box","text":"minimum capital requirements and other regulatory requirements, which indirectly impact the Funds","page_number":102,"box":{"x":117,"y":118,"width":743,"height":12}},{"id":"e2c01de7-bbd2-41f4-aa85-e3dee88788aa","block_type":"box","text":"that enter into transactions with them.","page_number":102,"box":{"x":116,"y":134,"width":284,"height":9}},{"id":"054c102e-13e1-41a9-a685-369f2e08e6ec","block_type":"box","text":"The CFTC requires that certain interest rate swaps and certain credit default swaps must be executed","page_number":102,"box":{"x":116,"y":165,"width":761,"height":11}},{"id":"220070f7-3008-4dee-9e82-7ca935e0b4db","block_type":"box","text":"in regulated markets and be submitted for clearing to regulated clearinghouses. The SEC is also","page_number":102,"box":{"x":117,"y":180,"width":719,"height":12}},{"id":"e755fab0-29db-49aa-9764-3f70b892e94f","block_type":"box","text":"expected to impose similar requirements on certain security-based derivatives in the future. OTC","page_number":102,"box":{"x":116,"y":196,"width":723,"height":12}},{"id":"ffea8f69-f43a-4db2-b8dd-88c4f655274f","block_type":"box","text":"derivatives trades submitted for clearing are subject to minimum initial and variation margin","page_number":102,"box":{"x":116,"y":211,"width":681,"height":12}},{"id":"a66d09eb-28fc-4ad7-a8c8-9c45ae9c71cb","block_type":"box","text":"requirements set by the relevant clearinghouse, as well as margin requirements mandated by the","page_number":102,"box":{"x":117,"y":227,"width":726,"height":12}},{"id":"04eece4d-659b-44f3-b4ac-e7f5325ac5b2","block_type":"box","text":"CFTC, SEC and/or federal prudential regulators. In addition, futures commission merchants (“FCMs”),","page_number":102,"box":{"x":117,"y":242,"width":760,"height":12}},{"id":"45f1b3be-4157-4142-92f5-4ed95fa9ddd0","block_type":"box","text":"who act as clearing members on behalf of customers for cleared OTC derivatives and futures","page_number":102,"box":{"x":116,"y":258,"width":697,"height":12}},{"id":"dc37328c-729a-4634-959d-53443eb3b698","block_type":"box","text":"contracts, also have discretion to increase a Fund’s margin requirements for these transactions beyond","page_number":102,"box":{"x":116,"y":273,"width":772,"height":12}},{"id":"15e1cb4b-a248-4a28-90e6-eb0b0452d965","block_type":"box","text":"any regulatory and clearinghouse minimums subject to any restrictions on such discretion in the","page_number":102,"box":{"x":116,"y":289,"width":715,"height":12}},{"id":"3b9d8e3a-4c63-4875-91f1-f8e8a335cd26","block_type":"box","text":"documentation between the FCM and the customer. These regulatory requirements may make it more","page_number":102,"box":{"x":116,"y":304,"width":764,"height":12}},{"id":"cc63958b-a645-4345-a000-737cb4e577aa","block_type":"box","text":"difficult and costly for the Funds to enter into highly tailored or customized transactions, potentially","page_number":102,"box":{"x":116,"y":320,"width":733,"height":12}},{"id":"78b58b8e-e2ae-4712-80f4-067369667065","block_type":"box","text":"rendering certain investment strategies impossible or not economically feasible. If a Fund decides to","page_number":102,"box":{"x":117,"y":335,"width":747,"height":12}},{"id":"b663c93d-b1bf-4112-8663-7cc3a00e9761","block_type":"box","text":"execute and clear cleared OTC derivatives and/or futures contracts through execution facilities,","page_number":102,"box":{"x":116,"y":351,"width":712,"height":12}},{"id":"ff2d940c-a72c-48a7-9523-bc6cd36f3763","block_type":"box","text":"exchanges or clearinghouses, either indirectly through an executing broker, clearing member FCM or","page_number":102,"box":{"x":116,"y":366,"width":756,"height":12}},{"id":"12b1a016-2988-440b-b169-c65603edb7e5","block_type":"box","text":"as a direct member, a Fund would be required to comply with the rules of the execution facility,","page_number":102,"box":{"x":116,"y":382,"width":709,"height":12}},{"id":"ffe58691-3c19-475a-b57f-a763ac47f695","block_type":"box","text":"exchange or clearinghouse and other applicable law.","page_number":102,"box":{"x":116,"y":397,"width":397,"height":12}},{"id":"07d894ad-fa02-4471-9140-9fbdeadcde04","block_type":"box","text":"With respect to cleared OTC derivatives and futures contracts and options on futures, a Fund will not","page_number":102,"box":{"x":116,"y":428,"width":753,"height":12}},{"id":"fe02b795-59a0-4a1a-b601-497b19ac460b","block_type":"box","text":"face a clearinghouse directly but rather will do so through a FCM that is registered with the CFTC and/","page_number":102,"box":{"x":116,"y":444,"width":759,"height":12}},{"id":"bb6dac6f-cc01-49fb-94b5-04816c7511e3","block_type":"box","text":"or SEC and that acts as a clearing member. A Fund may face the indirect risk of the failure of another","page_number":102,"box":{"x":116,"y":459,"width":759,"height":12}},{"id":"37583d8e-7e00-49b4-87aa-d632fe86b573","block_type":"box","text":"clearing member customer to meet its obligations to its clearing member. Such scenario could arise","page_number":102,"box":{"x":116,"y":475,"width":744,"height":12}},{"id":"026eb407-1f02-4490-ac90-5c67837de538","block_type":"box","text":"due to a default by the clearing member on its obligations to the clearinghouse simultaneously with a","page_number":102,"box":{"x":116,"y":490,"width":752,"height":12}},{"id":"51bf4b4a-f478-4806-a0a0-dac9ba3ac094","block_type":"box","text":"customer’s failure to meet its obligations to the clearing member.","page_number":102,"box":{"x":116,"y":506,"width":485,"height":12}},{"id":"7425b881-0425-450c-a431-71209ce63d47","block_type":"box","text":"Clearing member FCMs are required to post initial margin to the clearinghouses through which they","page_number":102,"box":{"x":117,"y":537,"width":742,"height":12}},{"id":"abbeb18f-2816-4d86-a712-c7ecd1f3955a","block_type":"box","text":"clear their customers’ cleared OTC derivatives and futures contracts, instead of using such initial","page_number":102,"box":{"x":116,"y":552,"width":722,"height":12}},{"id":"c31240d3-9fce-4643-b2a1-03c0f8cd76a4","block_type":"box","text":"margin in their businesses, as was widely permitted for OTC derivatives before Dodd-Frank. While an","page_number":102,"box":{"x":117,"y":568,"width":757,"height":12}},{"id":"3d46adb0-17d7-43a1-bf7d-f20c79da608f","block_type":"box","text":"FCM may require its customer to post initial margin in excess of clearinghouse requirements, and","page_number":102,"box":{"x":117,"y":583,"width":727,"height":12}},{"id":"276d5008-92d3-448f-91e7-387bd4772dd6","block_type":"box","text":"certain clearinghouses may share a portion of their earnings on initial margin with their clearing","page_number":102,"box":{"x":116,"y":599,"width":710,"height":12}},{"id":"c242dd56-bfd7-4a8e-b133-6ea50c543f03","block_type":"box","text":"members, some portion of the initial margin that is passed through to the clearinghouse does not","page_number":102,"box":{"x":117,"y":614,"width":722,"height":12}},{"id":"edd50ff5-3235-44b7-ba13-9e596eea6069","block_type":"box","text":"generate earnings for the FCM. The inability of FCMs to earn the same levels of returns on initial","page_number":102,"box":{"x":116,"y":630,"width":722,"height":12}},{"id":"806cafca-ac69-4740-8fda-421836dbefc6","block_type":"box","text":"margin for cleared OTC derivatives as they could earn with respect to non-cleared OTC derivatives","page_number":102,"box":{"x":117,"y":645,"width":739,"height":12}},{"id":"48739a6e-85af-41a8-9a4d-b4415131b7c0","block_type":"box","text":"may cause FCMs to charge higher fees, or provide less favorable pricing on cleared OTC derivatives","page_number":102,"box":{"x":117,"y":661,"width":747,"height":12}},{"id":"087afc33-093e-425c-a337-9b59bddd9d99","block_type":"box","text":"than swap dealers will provide for non-cleared OTC derivatives. Furthermore, customers, including the","page_number":102,"box":{"x":116,"y":676,"width":760,"height":12}},{"id":"68736530-d61e-4375-92d2-d3c49ec99875","block_type":"box","text":"Funds, are subject to additional fees payable to FCMs with respect to cleared OTC derivatives, which","page_number":102,"box":{"x":117,"y":692,"width":751,"height":12}},{"id":"9e6050f3-8489-494c-8236-bb083a613479","block_type":"box","text":"may raise the cost to Funds of clearing as compared to trading non-cleared OTC derivatives bilaterally.","page_number":102,"box":{"x":117,"y":707,"width":763,"height":12}},{"id":"ac0a65cf-b2bb-48d1-80e8-88da49472082","block_type":"box","text":"With respect to uncleared swaps, registered swap dealers and security-based swap dealers are","page_number":102,"box":{"x":116,"y":738,"width":710,"height":12}},{"id":"a3d617c5-a28b-4d35-b742-aac3a0f50d87","block_type":"box","text":"required to exchange variation margin with a Fund and may be required by applicable regulations to","page_number":102,"box":{"x":117,"y":754,"width":740,"height":12}},{"id":"c7794ce2-2b06-4ef0-8b2f-ecd0edf85377","block_type":"box","text":"collect (and in some cases exchange) initial margin with a Fund. Both initial and variation margin may","page_number":102,"box":{"x":116,"y":769,"width":753,"height":12}},{"id":"14896fe3-040e-4cfa-8392-ea68fa6d2666","block_type":"box","text":"be comprised of cash and/or securities, subject to applicable regulatory haircuts and other restrictions.","page_number":102,"box":{"x":117,"y":785,"width":757,"height":12}},{"id":"5096ad43-e1a7-4273-a057-9acc7d351381","block_type":"box","text":"Shares of investment companies (other than certain money market funds) may not be posted as","page_number":102,"box":{"x":116,"y":800,"width":713,"height":12}},{"id":"b86a2442-059b-488a-8e06-448c49e6732e","block_type":"box","text":"collateral under applicable regulations.","page_number":102,"box":{"x":116,"y":816,"width":285,"height":12}},{"id":"c376b747-eb5c-4756-9876-fea8d6540845","block_type":"box","text":"The CFTC, certain foreign regulators, and many futures exchanges have established (and continue to","page_number":102,"box":{"x":116,"y":847,"width":760,"height":12}},{"id":"f4bbffaf-4e29-49fb-8818-0e5264ecad30","block_type":"box","text":"evaluate and monitor) speculative position limits (“position limits”) on the maximum speculative position","page_number":102,"box":{"x":116,"y":862,"width":771,"height":12}},{"id":"7ad8d604-2981-4750-91e1-36419acfcdb5","block_type":"box","text":"which any person, or group of persons acting in concert, may hold or control in particular contracts. In","page_number":102,"box":{"x":116,"y":878,"width":759,"height":12}},{"id":"69df626a-9ce0-446b-a689-fa9f01bc1089","block_type":"box","text":"II-18","page_number":102,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"7e21033a-59c4-4fed-bf7a-87b2fcc11d54","block_type":"box","text":"NM0926U-5926888-102/257","page_number":102,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"cb57614b-9aea-4867-8b75-96fefcdc074d","block_type":"box","text":"addition, U.S. federal position limits apply to swaps that are economically equivalent to futures","page_number":103,"box":{"x":116,"y":87,"width":703,"height":12}},{"id":"7023dafd-4dff-49b6-8ec5-90614b3d189e","block_type":"box","text":"contracts on certain agricultural, metals and energy commodities. All positions owned or controlled by","page_number":103,"box":{"x":116,"y":103,"width":758,"height":12}},{"id":"4f16cc15-bad5-411f-a566-b67d84e4d621","block_type":"box","text":"the same person or entity, even if in different accounts, must be aggregated for purposes of complying","page_number":103,"box":{"x":116,"y":118,"width":766,"height":12}},{"id":"b797bc47-2df1-443e-90d3-668379a095cb","block_type":"box","text":"with the speculative limits. Thus, even if a Fund does not intend to exceed applicable position limits, it","page_number":103,"box":{"x":116,"y":134,"width":758,"height":11}},{"id":"3aa80987-1515-43f9-ae28-c85d20837315","block_type":"box","text":"is possible that different clients managed by the Manager and its affiliates may be aggregated for this","page_number":103,"box":{"x":117,"y":149,"width":755,"height":12}},{"id":"ddf9f128-f4bd-4562-a294-6617294cb269","block_type":"box","text":"purpose. Therefore, the trading decisions of the Manager may have to be modified and positions held","page_number":103,"box":{"x":117,"y":165,"width":757,"height":12}},{"id":"f73d2f21-b0c1-48cc-b4e4-fc7059bd9f5d","block_type":"box","text":"by a Fund liquidated in order to avoid exceeding such limits. The modification of investment decisions","page_number":103,"box":{"x":117,"y":180,"width":757,"height":12}},{"id":"d2558a85-8bb1-4cce-8823-b4d95e064b80","block_type":"box","text":"or the elimination of open positions, if it occurs, may adversely affect the profitability of a Fund. A","page_number":103,"box":{"x":116,"y":196,"width":723,"height":12}},{"id":"74332c22-3f66-470f-97b6-857d6108efda","block_type":"box","text":"violation of position limits could also lead to regulatory action materially adverse to a Fund’s investment","page_number":103,"box":{"x":116,"y":211,"width":770,"height":12}},{"id":"0f9f91b7-076d-4f10-b53c-fba2dfae283c","block_type":"box","text":"strategy. A Fund may also be affected by other regimes, including those of the European Union and","page_number":103,"box":{"x":116,"y":227,"width":746,"height":12}},{"id":"60d43c68-9d95-460b-98f5-dcdb03bb5573","block_type":"box","text":"United Kingdom, and trading venues that impose position limits on commodity derivative contracts.","page_number":103,"box":{"x":117,"y":242,"width":737,"height":12}},{"id":"c872beca-6a10-42f6-a98d-61d8f4319a58","block_type":"box","text":"Additional Regulation of Derivatives.","page_number":103,"box":{"x":115,"y":275,"width":269,"height":12}},{"id":"2cefda19-240c-4771-ac7f-1b4be67fd1ec","block_type":"box","text":"Regulatory bodies outside the U.S. have also passed, proposed,","page_number":103,"box":{"x":386,"y":275,"width":489,"height":12}},{"id":"a8cb9dcf-e400-464b-87f8-f4fed1b18596","block_type":"box","text":"or may propose in the future, legislation similar to Dodd-Frank or other legislation that could increase","page_number":103,"box":{"x":116,"y":290,"width":753,"height":12}},{"id":"27700cf0-2df6-4eab-bfc8-53f88280cd08","block_type":"box","text":"the costs of participating in, or otherwise adversely impact the liquidity of, participating in the","page_number":103,"box":{"x":116,"y":306,"width":689,"height":12}},{"id":"f81b16f5-518d-4d3b-aba9-1ccd814c3224","block_type":"box","text":"commodities markets. For example, the European Market Infrastructure Regulation (Regulation (EU)","page_number":103,"box":{"x":116,"y":321,"width":752,"height":12}},{"id":"cce0dfa3-fdb8-45e0-984a-1b9fcaa2ce8a","block_type":"box","text":"No 648/2012) (“EMIR”) introduced certain requirements in respect of OTC derivatives including: (i) the","page_number":103,"box":{"x":117,"y":337,"width":761,"height":12}},{"id":"20ab4e15-dbe3-4a06-a367-fe7d33d0deff","block_type":"box","text":"mandatory clearing of OTC derivative contracts declared subject to the clearing obligation; (ii) risk","page_number":103,"box":{"x":117,"y":352,"width":728,"height":12}},{"id":"008df7c7-a8e2-4212-ac2b-2d9e8be715f3","block_type":"box","text":"mitigation techniques in respect of uncleared OTC derivative contracts, including the mandatory","page_number":103,"box":{"x":117,"y":368,"width":714,"height":12}},{"id":"321989d0-3615-4c94-8e5b-047f84fa175d","block_type":"box","text":"margining of uncleared OTC derivative contracts; and (iii) reporting and recordkeeping requirements in","page_number":103,"box":{"x":117,"y":383,"width":765,"height":12}},{"id":"6b5a0176-9359-463d-b600-1392b64c2e6f","block_type":"box","text":"respect of all derivatives contracts. By way of further example, the European Union Markets in","page_number":103,"box":{"x":117,"y":399,"width":703,"height":12}},{"id":"9928c9f6-9950-41d9-ba2c-7da9897248ab","block_type":"box","text":"Financial Instruments Directive (Directive 2014/65/EU) and Markets in Financial Instruments","page_number":103,"box":{"x":117,"y":414,"width":688,"height":12}},{"id":"80901d62-5c8c-4f69-be9c-c09f655db79b","block_type":"box","text":"Regulation (Regulation (EU) No 600/2014) (together “MiFID II”), which have applied since January 3,","page_number":103,"box":{"x":117,"y":430,"width":753,"height":12}},{"id":"daad020d-e72d-4ac4-a816-07e6b30ba384","block_type":"box","text":"2018, govern the provision of investment services and activities in relation to, as well as the organized","page_number":103,"box":{"x":116,"y":445,"width":762,"height":12}},{"id":"4761ecf5-128e-4b74-8d91-ecfdec00003d","block_type":"box","text":"trading of, financial instruments such as shares, bonds, units in collective investment schemes and","page_number":103,"box":{"x":116,"y":461,"width":738,"height":12}},{"id":"a3a54f71-67fa-47a0-ad31-dfd17c181454","block_type":"box","text":"derivatives. In particular, MiFID II requires European Union Member States to apply position limits to","page_number":103,"box":{"x":116,"y":476,"width":749,"height":12}},{"id":"10abb47a-6144-458c-8454-bd8cfc1d2950","block_type":"box","text":"the size of a net position a person can hold at any time in commodity derivatives traded on European","page_number":103,"box":{"x":116,"y":492,"width":754,"height":12}},{"id":"8d180339-8e09-4828-96f2-771abac37437","block_type":"box","text":"Union trading venues and in “economically equivalent” OTC contracts. If the requirements of EMIR and","page_number":103,"box":{"x":117,"y":507,"width":769,"height":12}},{"id":"0cb784e6-2d93-442c-b06a-a1631f5b1f8c","block_type":"box","text":"MiFID II apply, the cost of derivatives transactions is expected to increase.","page_number":103,"box":{"x":117,"y":523,"width":550,"height":12}},{"id":"746a58ce-b44f-440e-82d1-375852a5cf8b","block_type":"box","text":"In addition, regulations adopted by global prudential regulators that are now in effect require certain","page_number":103,"box":{"x":117,"y":555,"width":742,"height":13}},{"id":"67dbb6b5-d6fc-4ea9-a31b-066e730840e0","block_type":"box","text":"prudentially regulated entities and certain of their affiliates and subsidiaries (including swap dealers) to","page_number":103,"box":{"x":117,"y":571,"width":764,"height":12}},{"id":"0d3f7cd9-aba0-45a1-9a2a-187f1a4394ec","block_type":"box","text":"include in their derivatives contracts and certain other financial contracts, terms that delay or restrict","page_number":103,"box":{"x":117,"y":586,"width":745,"height":13}},{"id":"03986a27-e218-404f-8092-7de7992cba15","block_type":"box","text":"the rights of counterparties (such as the Funds) to terminate such contracts, foreclose upon collateral,","page_number":103,"box":{"x":116,"y":602,"width":761,"height":12}},{"id":"85265a57-9b37-4d55-9fcc-2e1dc9f63ad5","block_type":"box","text":"exercise other default rights or restrict transfers of credit support in the event that the prudentially","page_number":103,"box":{"x":116,"y":617,"width":725,"height":13}},{"id":"7b40786c-76d5-4688-9941-46252ee1ab09","block_type":"box","text":"regulated entity and/or its affiliates are subject to certain types of resolution or insolvency proceedings.","page_number":103,"box":{"x":117,"y":633,"width":765,"height":12}},{"id":"ac919ecb-e43b-4146-a330-51790fd80278","block_type":"box","text":"Similar regulations and laws have been adopted in non-U.S. jurisdictions that may apply to a Fund’s","page_number":103,"box":{"x":116,"y":648,"width":746,"height":13}},{"id":"a6bd08f8-f4f7-44a2-a850-c6e51bad4a0a","block_type":"box","text":"counterparties located in those jurisdictions. In particular, in the United Kingdom and the European","page_number":103,"box":{"x":116,"y":664,"width":731,"height":12}},{"id":"110c77f8-5e19-43cb-b9b9-2dcc33a813bf","block_type":"box","text":"Union, governmental authorities could reduce, eliminate or convert to equity the liabilities to a Fund of","page_number":103,"box":{"x":117,"y":680,"width":753,"height":12}},{"id":"15808f00-fe7b-4f4d-9005-53f39aeb79be","block_type":"box","text":"a counterparty experiencing financial difficulties (sometimes referred to as a “bail in”). It is possible that","page_number":103,"box":{"x":116,"y":695,"width":763,"height":12}},{"id":"fbb6d4a8-05ed-488c-8fcf-070c18cc55a3","block_type":"box","text":"these requirements, as well as potential additional related government regulation, could adversely","page_number":103,"box":{"x":116,"y":711,"width":726,"height":12}},{"id":"859da6d7-ddff-479c-babe-5cbdd05bb86f","block_type":"box","text":"affect a Fund’s ability to terminate existing derivatives contracts, exercise default rights or satisfy","page_number":103,"box":{"x":116,"y":726,"width":716,"height":12}},{"id":"f9b49a20-d99b-49b0-81e4-9771d9e8b398","block_type":"box","text":"obligations owed to it with collateral received under such contracts.","page_number":103,"box":{"x":116,"y":742,"width":496,"height":12}},{"id":"213e31d6-76d4-4835-ab73-c097cc17bbb1","block_type":"box","text":"Risk Factors in Derivatives.","page_number":103,"box":{"x":116,"y":774,"width":202,"height":10}},{"id":"f9509dd4-2ba2-4191-bd6f-893694b169d0","block_type":"box","text":"There are significant risks that apply generally to derivatives transactions, including:","page_number":103,"box":{"x":116,"y":798,"width":620,"height":12}},{"id":"2f1b9474-9bea-4e56-bf81-6e8e2aa219b8","block_type":"box","text":"Correlation Risk —","page_number":103,"box":{"x":117,"y":831,"width":123,"height":10}},{"id":"d3666f47-801e-4dee-976b-04a8cae2840d","block_type":"box","text":"— the risk that changes in the value of a derivative will not match the changes in the","page_number":103,"box":{"x":240,"y":831,"width":631,"height":12}},{"id":"1dc286ab-b077-41f0-9203-b8a414c51131","block_type":"box","text":"value of the portfolio holdings that are being hedged or of the particular market or security to which the","page_number":103,"box":{"x":116,"y":846,"width":765,"height":13}},{"id":"0b1d6233-4bc1-4e04-ad10-1e15686a5822","block_type":"box","text":"Fund seeks exposure. There are a number of factors which may prevent a derivative instrument from","page_number":103,"box":{"x":117,"y":862,"width":754,"height":12}},{"id":"c7fc1919-3220-472c-b9f8-2f771ae652e3","block_type":"box","text":"achieving the desired correlation (or inverse correlation) with an underlying asset, rate or index, such","page_number":103,"box":{"x":116,"y":877,"width":753,"height":13}},{"id":"4326bc8d-e7a1-4ade-acfd-683e568b58a6","block_type":"box","text":"II-19","page_number":103,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"c8d5ec16-52fc-4fcb-901d-8024ef8ae801","block_type":"box","text":"NM0926U-5926888-103/257","page_number":103,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"1a74660d-1f4e-4c5b-a2f7-605075841c9b","block_type":"box","text":"as the impact of fees, expenses and transaction costs, the timing of pricing, and disruptions or illiquidity","page_number":104,"box":{"x":116,"y":87,"width":772,"height":12}},{"id":"478cf5dc-2ae5-40a0-af7e-e0493e4125c2","block_type":"box","text":"in the markets for such derivative instrument.","page_number":104,"box":{"x":117,"y":102,"width":338,"height":10}},{"id":"2a7f90f7-0ab1-4220-90bb-3320cc86141d","block_type":"box","text":"Counterparty Risk —","page_number":104,"box":{"x":117,"y":134,"width":138,"height":12}},{"id":"9b8361a9-5bbc-4e80-8a05-249c7a4c6c15","block_type":"box","text":"—","page_number":104,"box":{"x":255,"y":139,"width":22,"height":4}},{"id":"2f3d1b97-82e5-4f02-a6fe-321d01e60f5d","block_type":"box","text":"the risk that a derivatives transaction counterparty will be unable or unwilling to","page_number":104,"box":{"x":277,"y":134,"width":590,"height":12}},{"id":"05cc4600-9c4c-4313-9689-8128c6750e67","block_type":"box","text":"make payments or otherwise honor its obligations to a Fund and the related risks of having","page_number":104,"box":{"x":117,"y":149,"width":678,"height":12}},{"id":"91ba877f-e2cd-4b44-b4b9-3b660989f044","block_type":"box","text":"concentrated exposure to such a counterparty. In particular, derivatives traded in OTC markets often","page_number":104,"box":{"x":116,"y":165,"width":751,"height":12}},{"id":"b052f0c4-965e-4205-bd69-5dd7d36e9c0b","block_type":"box","text":"are not guaranteed by an exchange or clearing corporation and often do not require payment of","page_number":104,"box":{"x":116,"y":180,"width":714,"height":12}},{"id":"5200e5e8-c720-477d-9a6c-5ddd6c5ad3ce","block_type":"box","text":"margin, and to the extent that the Fund has unrealized gains in such instruments or has deposited","page_number":104,"box":{"x":117,"y":196,"width":732,"height":12}},{"id":"fe81a558-f3c2-4b5b-9b54-34e07f8d886e","block_type":"box","text":"collateral with its counterparties the Fund is at risk that its counterparties will become bankrupt or","page_number":104,"box":{"x":116,"y":211,"width":725,"height":12}},{"id":"b282636b-ce60-4972-9c78-e1bc7a20b9b6","block_type":"box","text":"otherwise fail to honor their obligations. A Fund will typically attempt to minimize counterparty risk by","page_number":104,"box":{"x":116,"y":227,"width":750,"height":12}},{"id":"4548781a-617f-4801-a0a4-20b6f53454d4","block_type":"box","text":"engaging in OTC derivatives transactions only with creditworthy entities that have substantial capital or","page_number":104,"box":{"x":116,"y":242,"width":768,"height":12}},{"id":"ac71eef5-202d-4a40-8ec0-9e535df115b2","block_type":"box","text":"that have provided the Fund with a third-party guaranty or other credit support. When a Fund enters","page_number":104,"box":{"x":116,"y":258,"width":745,"height":12}},{"id":"cb3cd0ee-9d74-4d6f-b097-eff3e901c3b0","block_type":"box","text":"into a derivatives transaction that is centrally cleared (whether mandatorily or voluntarily), the Fund is","page_number":104,"box":{"x":117,"y":273,"width":754,"height":12}},{"id":"72470981-ae56-422a-8c1b-49ec89fc7b30","block_type":"box","text":"subject to the credit risk of the clearing house and the clearing member through which it holds its","page_number":104,"box":{"x":116,"y":289,"width":722,"height":12}},{"id":"9d3f8d84-cb39-4e1e-a034-8ea90bcacce4","block_type":"box","text":"cleared position. Credit risk of market participants with respect to derivatives that are centrally cleared","page_number":104,"box":{"x":116,"y":304,"width":761,"height":12}},{"id":"7196a137-2be2-4a3f-b03f-cfaa3eb39d35","block_type":"box","text":"is concentrated in a few clearing houses and increasingly fewer clearing members. It is not clear how","page_number":104,"box":{"x":117,"y":320,"width":754,"height":12}},{"id":"bed05dd6-c5c4-48d4-85ca-a20445e50ee1","block_type":"box","text":"an insolvency proceeding of a clearing house would be conducted and what impact an insolvency of a","page_number":104,"box":{"x":116,"y":335,"width":762,"height":12}},{"id":"2d4faa98-1528-483d-ad6f-1f473160fa62","block_type":"box","text":"clearing house would have on the financial system. Also, a Fund will not be fully protected in the event","page_number":104,"box":{"x":116,"y":351,"width":764,"height":12}},{"id":"52ae0f28-40aa-4b09-850d-641a9c49a06b","block_type":"box","text":"of the bankruptcy of a Fund’s clearing member because the Fund would be limited to recovering only a","page_number":104,"box":{"x":116,"y":366,"width":768,"height":12}},{"id":"2c8527e5-1adf-4c6d-bf4d-bc44743c3123","block_type":"box","text":"pro rata share of the funds held by the clearing member on behalf of customers by account class for","page_number":104,"box":{"x":117,"y":382,"width":747,"height":12}},{"id":"bd36dba5-5527-4632-8d0c-9a646b1c79b1","block_type":"box","text":"cleared derivatives. Although a clearing member is required to segregate assets from customers with","page_number":104,"box":{"x":116,"y":397,"width":755,"height":12}},{"id":"0c0a21f4-0514-4393-b567-a5ed39ff1b0c","block_type":"box","text":"respect to cleared derivatives positions from the clearing member’s proprietary assets, if a clearing","page_number":104,"box":{"x":117,"y":413,"width":736,"height":12}},{"id":"7fc6a712-d358-4e13-812e-69cc91c8226e","block_type":"box","text":"member does not comply with the applicable regulations, or in the event of fraud or misappropriation of","page_number":104,"box":{"x":117,"y":428,"width":768,"height":12}},{"id":"8fb640f3-2051-4fe8-afef-8e63b9ac4eed","block_type":"box","text":"customer assets by a clearing member, a Fund could have only an unsecured creditor claim in an","page_number":104,"box":{"x":116,"y":444,"width":730,"height":12}},{"id":"4c67d73c-a4d9-4fbd-aea0-ebfc6cc84ab7","block_type":"box","text":"insolvency of the clearing member with respect to the assets held by the clearing member.","page_number":104,"box":{"x":117,"y":459,"width":675,"height":12}},{"id":"38c9af9e-c92e-48f8-b877-478f364e4633","block_type":"box","text":"Credit Risk —","page_number":104,"box":{"x":117,"y":490,"width":86,"height":10}},{"id":"f9cd1aef-b190-4c94-bffe-5a87ce4732ff","block_type":"box","text":"— the risk that the reference entity in a credit default swap or similar derivative will not be","page_number":104,"box":{"x":203,"y":490,"width":668,"height":12}},{"id":"11395352-6516-4e75-8c24-644a9b0781f5","block_type":"box","text":"able to honor its financial obligations.","page_number":104,"box":{"x":116,"y":506,"width":280,"height":12}},{"id":"f30835bd-fc2d-434a-a2e1-f262ad805e17","block_type":"box","text":"Currency Risk —","page_number":104,"box":{"x":117,"y":537,"width":109,"height":12}},{"id":"1bb09cca-aaf2-4cfb-8abf-bab80b1bebef","block_type":"box","text":"— the risk that changes in the exchange rate between two currencies will adversely","page_number":104,"box":{"x":226,"y":537,"width":625,"height":12}},{"id":"8392f32b-2a1b-455b-bbaf-a6745b4c6e1d","block_type":"box","text":"affect the value (in U.S. dollar terms) of a derivative.","page_number":104,"box":{"x":116,"y":552,"width":392,"height":12}},{"id":"560fa072-61fc-4fa8-9fe3-817353f772ec","block_type":"box","text":"Illiquidity Risk —","page_number":104,"box":{"x":117,"y":583,"width":105,"height":12}},{"id":"50ec7616-3c66-4719-b9c9-2675b76c9c03","block_type":"box","text":"— the risk that certain securities or instruments may be difficult or impossible to sell at","page_number":104,"box":{"x":222,"y":583,"width":644,"height":12}},{"id":"924bb546-adbe-4505-8855-f5d746f1df47","block_type":"box","text":"the time or at the price desired by a Fund in connection with payments of margin, collateral, or","page_number":104,"box":{"x":116,"y":599,"width":704,"height":12}},{"id":"96207d15-7e05-489c-a387-de3af2fc6dc8","block_type":"box","text":"settlement payments. There can be no assurance that a Fund will be able to unwind or offset a","page_number":104,"box":{"x":116,"y":614,"width":708,"height":12}},{"id":"dd3f8caa-5617-4835-b129-2d5e172ed76c","block_type":"box","text":"derivative at its desired price, in a secondary market or otherwise. It may, therefore, not be possible for","page_number":104,"box":{"x":116,"y":630,"width":768,"height":12}},{"id":"7232b2e3-775e-4e19-8852-f6312b513a67","block_type":"box","text":"the Fund to unwind its position in a derivative without incurring substantial losses (if at all). Certain","page_number":104,"box":{"x":116,"y":645,"width":733,"height":12}},{"id":"66d49b51-e35e-4a6d-9290-14b67f38fe47","block_type":"box","text":"OTC derivatives, including swaps and OTC options, involve substantial illiquidity risk. Illiquidity may","page_number":104,"box":{"x":116,"y":661,"width":736,"height":12}},{"id":"7e44761a-cea0-4ee3-b51a-80105ebba070","block_type":"box","text":"also make it more difficult for a Fund to ascertain a market value for such derivatives. A Fund will,","page_number":104,"box":{"x":116,"y":676,"width":723,"height":11}},{"id":"a0d29c6a-d2ea-4b57-8270-4afeb6b8e521","block_type":"box","text":"therefore, acquire illiquid OTC derivatives (i) if the agreement pursuant to which the instrument is","page_number":104,"box":{"x":116,"y":692,"width":719,"height":12}},{"id":"743cc2da-0e3a-4cfa-8f04-5db6e3954c86","block_type":"box","text":"purchased contains a formula price at which the instrument may be terminated or sold, or (ii) for which","page_number":104,"box":{"x":117,"y":707,"width":757,"height":12}},{"id":"2faff559-afe9-4db3-bef5-986819a689ab","block_type":"box","text":"the Manager anticipates the Fund can receive on each business day at least two independent bids or","page_number":104,"box":{"x":116,"y":723,"width":751,"height":12}},{"id":"423d6f8d-6e7d-4c5d-abe8-aa3e3fd93258","block_type":"box","text":"offers, unless a quotation from only one dealer is available, in which case that dealer’s quotation may","page_number":104,"box":{"x":116,"y":738,"width":751,"height":12}},{"id":"f1fb194f-30e7-454d-9505-20ac3648bfaf","block_type":"box","text":"be used. The illiquidity of the derivatives markets may be due to various factors, including congestion,","page_number":104,"box":{"x":117,"y":754,"width":752,"height":12}},{"id":"b2f7d77b-c6e9-4fb4-b5e1-eb4ed6abed15","block_type":"box","text":"disorderly markets, limitations on deliverable supplies, the participation of speculators, government","page_number":104,"box":{"x":116,"y":769,"width":733,"height":12}},{"id":"dff5db7a-4a0e-4371-8225-f161755e9995","block_type":"box","text":"regulation and intervention, and technical and operational or system failures. In addition, the liquidity of","page_number":104,"box":{"x":117,"y":785,"width":763,"height":12}},{"id":"eec4b3e4-594e-4ca7-884e-65f4e1e2e1b5","block_type":"box","text":"a market in an exchange-traded derivative contract may be adversely affected by “daily price","page_number":104,"box":{"x":116,"y":800,"width":688,"height":12}},{"id":"72b146e4-3e2d-4079-ae1e-3924c1228b29","block_type":"box","text":"fluctuation limits” established by the exchanges which limit the amount of fluctuation in an exchange","page_number":104,"box":{"x":116,"y":816,"width":747,"height":12}},{"id":"bde5b658-0d4d-44a0-b151-b6d9c8dc80ef","block_type":"box","text":"traded contract price during a single trading day. Once the daily limit has been reached in the contract,","page_number":104,"box":{"x":116,"y":831,"width":766,"height":12}},{"id":"4334b5bd-e482-44b0-a2b1-8b4f8b3b3615","block_type":"box","text":"no trades may be entered into at a price beyond the limit, thus preventing the liquidation of open","page_number":104,"box":{"x":117,"y":847,"width":717,"height":12}},{"id":"85bbcdea-47a8-4299-ad92-daf5f302fe2d","block_type":"box","text":"positions. Prices have in the past moved to the daily limit on a number of consecutive trading days with","page_number":104,"box":{"x":117,"y":862,"width":768,"height":12}},{"id":"cdb0b36e-65bf-4583-9607-846301041db9","block_type":"box","text":"little to no trading. If it is not possible to close an open derivative position entered into by the Fund, the","page_number":104,"box":{"x":117,"y":878,"width":762,"height":12}},{"id":"f50f8d9e-0a2d-411d-8d84-cafc2bd2a648","block_type":"box","text":"II-20","page_number":104,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"c69b3da9-fb85-40f0-bff1-e2ebdc5e4820","block_type":"box","text":"NM0926U-5926888-104/257","page_number":104,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"bd1f1bce-a980-4d8f-a9a5-766cab5c0aa3","block_type":"box","text":"Fund would continue to be required to make daily cash payments of variation margin in the event of","page_number":105,"box":{"x":117,"y":87,"width":743,"height":12}},{"id":"91e05131-86e2-403a-8248-80c8adee53fa","block_type":"box","text":"adverse price movements. In such a situation, if the Fund has insufficient cash, it may have to sell","page_number":105,"box":{"x":116,"y":102,"width":732,"height":13}},{"id":"b8116a74-4095-43a6-bbe4-19946b4954c6","block_type":"box","text":"portfolio securities to meet daily variation margin requirements at a time when it may be","page_number":105,"box":{"x":117,"y":118,"width":654,"height":12}},{"id":"cb3ef7b7-443b-49a4-93dc-6cce116ce076","block_type":"box","text":"disadvantageous to do so.","page_number":105,"box":{"x":116,"y":134,"width":201,"height":12}},{"id":"7b3b2b13-d907-4fd5-9012-bac78c6138b7","block_type":"box","text":"Index Risk","page_number":105,"box":{"x":117,"y":166,"width":78,"height":9}},{"id":"5ba39766-d4d8-4b6a-8702-e7187b5792d4","block_type":"box","text":"k — if the derivative is linked to the performance of an index, it will be subject to the risks","page_number":105,"box":{"x":194,"y":166,"width":656,"height":12}},{"id":"5245c171-f8ae-4e3d-af28-01faaeb8af1d","block_type":"box","text":"associated with changes in that index. If the index changes, the Fund could receive lower interest","page_number":105,"box":{"x":116,"y":181,"width":728,"height":12}},{"id":"ddd6e72d-5e10-4ccf-863f-99acf3ec450b","block_type":"box","text":"payments or experience a reduction in the value of the derivative to below the price that the Fund paid","page_number":105,"box":{"x":117,"y":197,"width":762,"height":12}},{"id":"76f8257e-3d90-45cf-82a4-8f8788bc6070","block_type":"box","text":"for such derivative.","page_number":105,"box":{"x":116,"y":212,"width":146,"height":10}},{"id":"0404e775-56b5-419f-8f2f-9d4481eca835","block_type":"box","text":"Legal Risk","page_number":105,"box":{"x":116,"y":245,"width":79,"height":12}},{"id":"5fbbb82f-231a-45bf-b2ee-abb60010654b","block_type":"box","text":"k — the risk of insufficient documentation, insufficient capacity or authority of counterparty, or","page_number":105,"box":{"x":194,"y":245,"width":689,"height":12}},{"id":"b05a965e-8649-4c60-a4fe-fd15e4d1cf1d","block_type":"box","text":"legality or enforceability of a contract.","page_number":105,"box":{"x":117,"y":260,"width":281,"height":12}},{"id":"f8cba809-846a-469d-90b0-9cbb96fab03b","block_type":"box","text":"Leverage Risk —","page_number":105,"box":{"x":116,"y":293,"width":112,"height":12}},{"id":"e1fcd553-059e-406b-82ba-911d2e73411a","block_type":"box","text":"— the risk that a Fund’s derivatives transactions can magnify the Fund’s gains and","page_number":105,"box":{"x":228,"y":293,"width":619,"height":12}},{"id":"bf1bb018-af81-4e40-ab51-d0b228a84a23","block_type":"box","text":"losses. Relatively small market movements may result in large changes in the value of a derivatives","page_number":105,"box":{"x":117,"y":308,"width":744,"height":12}},{"id":"ee639ccd-81df-43f0-9139-51d5431eda93","block_type":"box","text":"position and can result in losses that greatly exceed the amount originally invested.","page_number":105,"box":{"x":117,"y":324,"width":621,"height":12}},{"id":"e2455b3e-af37-4b43-a545-f69360c1603f","block_type":"box","text":"Market Risk —","page_number":105,"box":{"x":116,"y":356,"width":93,"height":10}},{"id":"27ea2ea8-8ade-4f64-ad4b-80dc82affa28","block_type":"box","text":"— the risk that changes in the value of one or more markets or changes with respect to","page_number":105,"box":{"x":209,"y":356,"width":653,"height":12}},{"id":"7e36b3b0-74d3-42cc-9e28-572e75fe089d","block_type":"box","text":"the value of the underlying asset will adversely affect the value of a derivative. In the event of an","page_number":105,"box":{"x":116,"y":371,"width":719,"height":13}},{"id":"ac45f67b-2cc9-41fc-b59e-192fcfe4fbd2","block_type":"box","text":"adverse movement, a Fund may be required to pay substantial additional margin to maintain its","page_number":105,"box":{"x":116,"y":387,"width":713,"height":12}},{"id":"2b35d2bb-e2d8-431c-8878-67aee25273f9","block_type":"box","text":"position or the Fund’s returns may be adversely affected.","page_number":105,"box":{"x":117,"y":402,"width":427,"height":13}},{"id":"43dba939-e3ed-4581-bbe6-52a0e0b94a14","block_type":"box","text":"Operational Risk","page_number":105,"box":{"x":117,"y":435,"width":124,"height":12}},{"id":"ae08e01a-d495-4ed2-b865-5a5d19cceead","block_type":"box","text":"k — the risk related to potential operational issues, including documentation issues,","page_number":105,"box":{"x":240,"y":435,"width":616,"height":12}},{"id":"773cfefd-ef22-4ac0-92f5-bcb27ea882a3","block_type":"box","text":"settlement issues, systems failures, inadequate controls and human error.","page_number":105,"box":{"x":116,"y":450,"width":555,"height":12}},{"id":"dcb6c006-6fcd-46d5-8ea0-5e5d2559e499","block_type":"box","text":"Valuation Risk —","page_number":105,"box":{"x":118,"y":483,"width":110,"height":9}},{"id":"f4c497df-55dc-48ce-9890-b474155c3ea9","block_type":"box","text":"— the risk that valuation sources for a derivative will not be readily available in the","page_number":105,"box":{"x":228,"y":483,"width":614,"height":12}},{"id":"3902ee51-d6c7-406f-b080-73463f474a94","block_type":"box","text":"market. This is possible especially in times of market distress, since many market participants may be","page_number":105,"box":{"x":117,"y":498,"width":760,"height":12}},{"id":"0b5ce2e9-aa11-4c29-a26c-9c1ff4b37d3b","block_type":"box","text":"reluctant to purchase complex instruments or quote prices for them.","page_number":105,"box":{"x":117,"y":514,"width":507,"height":12}},{"id":"fead5acf-88ce-498e-88a4-71142f562d07","block_type":"box","text":"Volatility Risk —","page_number":105,"box":{"x":118,"y":546,"width":102,"height":12}},{"id":"d7d8524a-6d33-4820-bb2e-0fc487e2fd67","block_type":"box","text":"— the risk that the value of derivatives will fluctuate significantly within a short time","page_number":105,"box":{"x":220,"y":546,"width":619,"height":12}},{"id":"cae02351-c856-44ab-83ef-9591611989b0","block_type":"box","text":"period.","page_number":105,"box":{"x":117,"y":562,"width":55,"height":12}},{"id":"a590dd9e-2042-40dc-b460-e3792bad88be","block_type":"box","text":"Types of Derivatives Transactions.","page_number":105,"box":{"x":118,"y":594,"width":261,"height":12}},{"id":"3da41acf-1cb6-4fc8-ada6-d4bf1c5cad75","block_type":"box","text":"A Fund may enter into derivatives transactions in accordance with its investment guidelines and","page_number":105,"box":{"x":116,"y":618,"width":715,"height":12}},{"id":"4671f21a-c16f-402f-97dc-d0760fb681a5","block_type":"box","text":"restrictions, including the following:","page_number":105,"box":{"x":117,"y":633,"width":263,"height":12}},{"id":"2b054ce1-25bf-41a4-bacd-d01fdc133101","block_type":"box","text":"Futures.","page_number":105,"box":{"x":116,"y":666,"width":60,"height":9}},{"id":"85e307dd-a98b-4cb2-b705-5e8b8a7d3398","block_type":"box","text":"A Fund may enter into futures contracts (“futures”) and options on futures contracts. Futures are","page_number":105,"box":{"x":116,"y":690,"width":713,"height":12}},{"id":"32bfcbc9-b0f5-4790-94bc-a147f1e26952","block_type":"box","text":"standardized, exchange-traded contracts that require a purchaser to take delivery, and a seller to make","page_number":105,"box":{"x":116,"y":705,"width":767,"height":12}},{"id":"9cbbeab8-88a1-4b21-9e8c-d97b9218fb22","block_type":"box","text":"delivery, of a specified amount of an asset at a specified future date and price. Upon purchasing or","page_number":105,"box":{"x":116,"y":721,"width":734,"height":12}},{"id":"067de45f-b105-4fbe-8b57-f3e878d80d9b","block_type":"box","text":"selling a futures contract, a Fund is required to deposit initial margin equal to a percentage of the","page_number":105,"box":{"x":116,"y":736,"width":718,"height":12}},{"id":"e01df226-e8ee-486f-94ac-183468e798bc","block_type":"box","text":"contract value. Futures contracts are marked to market daily for the duration of the contract, and the","page_number":105,"box":{"x":116,"y":752,"width":743,"height":12}},{"id":"522cb2b8-ea1b-4936-ae92-e720588f15d4","block_type":"box","text":"Fund will either post additional margin or be entitled to a payment, as applicable, based on the","page_number":105,"box":{"x":117,"y":767,"width":699,"height":12}},{"id":"9f2bd473-faaa-4c6d-8fce-d457b6509ab1","block_type":"box","text":"mark-to-market movement of the contract.","page_number":105,"box":{"x":117,"y":783,"width":311,"height":9}},{"id":"cebc9714-40a0-47e4-848a-c90f8ff03cea","block_type":"box","text":"A Fund may sell a futures contract prior to the completion","page_number":105,"box":{"x":116,"y":815,"width":425,"height":12}},{"id":"83ac90b6-dfc8-4c44-ad51-24cbd20d0f4a","block_type":"box","text":"of its term to limit its risk of loss from a","page_number":105,"box":{"x":548,"y":815,"width":284,"height":10}},{"id":"ea05c6d0-1910-46a6-a820-0c52299f8940","block_type":"box","text":"decline in the market value of portfolio holdings correlated with the futures contract. However, in the","page_number":105,"box":{"x":116,"y":831,"width":745,"height":12}},{"id":"b6c7f4a8-2290-47b2-9be4-90024af631c9","block_type":"box","text":"event the market value of the portfolio holdings correlated with the futures contract increases rather","page_number":105,"box":{"x":116,"y":846,"width":742,"height":12}},{"id":"742a31c1-974f-4616-befb-128f35f64f62","block_type":"box","text":"than decreases, a Fund will realize a loss on the futures position and a lower return on the portfolio","page_number":105,"box":{"x":116,"y":862,"width":739,"height":12}},{"id":"efc0811d-a3a0-40ec-8537-50bc11b6f6e4","block_type":"box","text":"holdings than would have been realized without the purchase of the futures contract.","page_number":105,"box":{"x":117,"y":877,"width":631,"height":12}},{"id":"48da536a-d1cc-4360-9c5c-d6bd2debd12d","block_type":"box","text":"II-21","page_number":105,"box":{"x":484,"y":909,"width":29,"height":9}},{"id":"09fce700-c4cd-4ea5-b7ce-c95d32f6344c","block_type":"box","text":"NM0926U-5926888-105/257","page_number":105,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"d28da621-749a-4664-b80f-420b69531c58","block_type":"box","text":"The purchase of a futures contract may provide a Fund a lower cost alternative to purchasing","page_number":106,"box":{"x":116,"y":87,"width":697,"height":12}},{"id":"6ebbb280-81b5-4de1-b56b-a584642245d8","block_type":"box","text":"securities or commodities directly. In the event that such securities or commodities decline in value or a","page_number":106,"box":{"x":116,"y":103,"width":772,"height":12}},{"id":"562eb7a3-bcb7-4f50-988e-d2d767f8adb7","block_type":"box","text":"Fund determines not to complete an anticipatory hedge transaction relating to a futures contract,","page_number":106,"box":{"x":117,"y":118,"width":720,"height":12}},{"id":"156dfd62-66f8-4b65-9eed-f67148bc7505","block_type":"box","text":"however, the Fund may realize a loss relating to the futures position.","page_number":106,"box":{"x":117,"y":134,"width":512,"height":12}},{"id":"d99a0d3e-986e-470c-b474-0266ace3138d","block_type":"box","text":"Futures contracts are also subject to position limits. In order to comply with position limits, a Fund may","page_number":106,"box":{"x":117,"y":166,"width":763,"height":12}},{"id":"3b4825af-7783-464a-988d-fa05c19b6e36","block_type":"box","text":"be required to liquidate positions or may not be able to fully implement trading instructions. Any such","page_number":106,"box":{"x":117,"y":181,"width":750,"height":12}},{"id":"e7d75a85-007f-4bc6-96fa-731c88194ea2","block_type":"box","text":"liquidation or limited implementation could result in substantial costs to a Fund. See “— Regulation of","page_number":106,"box":{"x":117,"y":196,"width":754,"height":13}},{"id":"bda7b753-2efc-4f1d-84c9-c8732ddb1659","block_type":"box","text":"Derivatives — Dodd-Frank Regulations” above.","page_number":106,"box":{"x":117,"y":212,"width":356,"height":12}},{"id":"7b04783b-062b-42b6-a783-2a31c82ad4fd","block_type":"box","text":"A Fund is also permitted to purchase or sell call and put options on futures contracts, including","page_number":106,"box":{"x":116,"y":244,"width":706,"height":12}},{"id":"8f914fad-474f-4789-8939-686078f5cfba","block_type":"box","text":"financial futures and stock indices. Generally, these strategies would be used under the same market","page_number":106,"box":{"x":116,"y":259,"width":757,"height":13}},{"id":"7cf09603-017b-4bd0-8e5b-fd41ac3f616a","block_type":"box","text":"and market sector conditions (","page_number":106,"box":{"x":116,"y":275,"width":225,"height":12}},{"id":"28efb37c-17b6-419c-af30-930eb655324d","block_type":"box","text":"i.e.","page_number":106,"box":{"x":342,"y":275,"width":20,"height":10}},{"id":"5d2ad579-eb71-4121-bfcf-014dd9624a75","block_type":"box","text":", conditions relating to specific types of investments) in which the","page_number":106,"box":{"x":365,"y":275,"width":485,"height":12}},{"id":"b8337376-7e72-48b2-abc8-a88f8c83b959","block_type":"box","text":"Fund entered into futures transactions. A Fund may purchase put options or write call options on","page_number":106,"box":{"x":117,"y":290,"width":720,"height":13}},{"id":"033ccc4e-dcfc-4273-a5b5-435fb243f3d7","block_type":"box","text":"futures contracts and stock indices in lieu of selling the underlying futures contract in anticipation of a","page_number":106,"box":{"x":116,"y":306,"width":754,"height":12}},{"id":"ab32a45b-fbfb-4258-8f7b-e2875bfb574d","block_type":"box","text":"decrease in the market value of its securities. Similarly, a Fund can purchase call options, or write put","page_number":106,"box":{"x":116,"y":321,"width":759,"height":13}},{"id":"206b0a9c-a0b8-45a0-9e67-6d85d138afb1","block_type":"box","text":"options on futures contracts and stock indices, as a substitute for the purchase of such futures","page_number":106,"box":{"x":116,"y":337,"width":705,"height":12}},{"id":"4320d224-0fa4-41a5-a58f-a10ffce0fbc0","block_type":"box","text":"contracts to hedge against the increased cost resulting from an increase in the market value of","page_number":106,"box":{"x":116,"y":352,"width":707,"height":13}},{"id":"6f40592d-bcef-49e4-b36f-bc19d1528fe3","block_type":"box","text":"securities which the Fund intends to purchase.","page_number":106,"box":{"x":116,"y":368,"width":350,"height":12}},{"id":"4b197197-fe14-4555-98d0-ae0e85e5c60f","block_type":"box","text":"To maintain greater flexibility, a Fund may invest in instruments which have characteristics similar to","page_number":106,"box":{"x":116,"y":400,"width":748,"height":12}},{"id":"2224d324-4a66-48ef-9f20-9d8e6e36c110","block_type":"box","text":"futures contracts. These instruments may take a variety of forms, such as debt securities with interest","page_number":106,"box":{"x":116,"y":415,"width":759,"height":13}},{"id":"5285696f-3f2c-4e26-b1f3-3d830de820e7","block_type":"box","text":"or principal payments determined by reference to the value of a security, an index of securities or a","page_number":106,"box":{"x":116,"y":431,"width":740,"height":12}},{"id":"b3367eaa-5126-4132-8b66-9802cae49e4f","block_type":"box","text":"commodity at a future point in time. The risks of such investments could reflect the risks of investing in","page_number":106,"box":{"x":116,"y":446,"width":764,"height":13}},{"id":"10e5245f-3fcb-4af4-9de2-603d17f8da85","block_type":"box","text":"futures and securities, including volatility and illiquidity.","page_number":106,"box":{"x":116,"y":462,"width":410,"height":12}},{"id":"6e2a692c-5327-41c2-ae8f-8eaed16f4bd9","block_type":"box","text":"Futures contracts and options on futures contracts are subject to significant correlation risk, leverage","page_number":106,"box":{"x":117,"y":494,"width":751,"height":12}},{"id":"415ca48d-f862-4e0f-ae30-5d10dbbe048c","block_type":"box","text":"risk, illiquidity risk, market risk and counterparty risk with respect to a Fund’s futures broker or the","page_number":106,"box":{"x":117,"y":509,"width":726,"height":13}},{"id":"830ea648-0c86-4128-bb6e-64285d28d1f2","block_type":"box","text":"clearinghouse. See “— Risk Factors in Derivatives” above.","page_number":106,"box":{"x":116,"y":525,"width":440,"height":12}},{"id":"856a810f-6aa8-4bd3-88fa-7407a08e30f0","block_type":"box","text":"Certain Funds may invest in futures based on carbon “allowances.” Under certain regulatory regimes, a","page_number":106,"box":{"x":117,"y":557,"width":771,"height":12}},{"id":"4c592345-826a-4641-afb3-81239f26325d","block_type":"box","text":"limit is set by a regulator, such as a government entity, on the total amount of specific greenhouse","page_number":106,"box":{"x":117,"y":572,"width":732,"height":13}},{"id":"5ce7e2be-c826-4978-aed1-82ff407120c8","block_type":"box","text":"gases, such as CO2, that can be emitted by regulated entities, such as manufacturers or energy","page_number":106,"box":{"x":116,"y":588,"width":720,"height":12}},{"id":"ac6de3ef-f779-4f02-8995-9fd189206591","block_type":"box","text":"producers. The regulator then may issue or sell individual “emission allowances” to regulated entities,","page_number":106,"box":{"x":117,"y":603,"width":756,"height":13}},{"id":"3e8c82ae-0513-4305-89dc-c5e6e7d2e510","block_type":"box","text":"which can then be traded on the open market. Commodity futures contracts linked to the value of","page_number":106,"box":{"x":116,"y":619,"width":725,"height":12}},{"id":"6f5102d7-5a41-4fa3-8642-b92e1fab30ed","block_type":"box","text":"emission allowances are known as “carbon futures.”","page_number":106,"box":{"x":116,"y":634,"width":392,"height":10}},{"id":"ab329878-c155-4589-a6ba-8c6a8bd4a4b1","block_type":"box","text":"The price for carbon futures contracts is based on a number of factors, including the supply of and the","page_number":106,"box":{"x":116,"y":666,"width":756,"height":13}},{"id":"d3574272-6c91-49f6-b221-8a808efbac22","block_type":"box","text":"demand for carbon futures contracts. Changes in law, market conditions and expectations, position","page_number":106,"box":{"x":116,"y":682,"width":734,"height":12}},{"id":"d370ba4b-72cc-4961-a674-dbff4b81b9eb","block_type":"box","text":"limits, collateral requirements, and other factors each can impact the supply of and demand for carbon","page_number":106,"box":{"x":117,"y":697,"width":758,"height":13}},{"id":"eeaa33df-96b4-44cb-8c4c-ba7a2a71d6bb","block_type":"box","text":"futures contracts. The market for carbon futures contracts is still developing and may be subject to","page_number":106,"box":{"x":116,"y":713,"width":729,"height":12}},{"id":"ad916ff7-a2ea-4dc3-8343-82161e2a468e","block_type":"box","text":"periods of illiquidity. During such times it may be difficult or impossible to buy or sell a position at the","page_number":106,"box":{"x":117,"y":728,"width":742,"height":13}},{"id":"b33938f4-4815-466c-b44c-7ac045fb6742","block_type":"box","text":"desired price. Market disruptions or volatility can also make it difficult to find a counterparty willing to","page_number":106,"box":{"x":116,"y":744,"width":742,"height":12}},{"id":"118bb33e-bb81-41f3-b23d-23f22befdf7a","block_type":"box","text":"transact at a reasonable price and sufficient size.","page_number":106,"box":{"x":116,"y":759,"width":363,"height":12}},{"id":"de0f028c-87a8-485c-9d7d-0f6ab8071a3d","block_type":"box","text":"Swap Agreements.","page_number":106,"box":{"x":117,"y":791,"width":139,"height":13}},{"id":"d19f596d-ee86-47f5-8ef2-0ecf7e9853e4","block_type":"box","text":"A Fund may enter into swap agreements for hedging purposes or speculative purposes. Swap","page_number":106,"box":{"x":116,"y":815,"width":699,"height":12}},{"id":"3ddfa0d4-f314-4029-ab4b-978e24c19e3a","block_type":"box","text":"agreements are OTC contracts entered into primarily by financial institutions and institutional investors","page_number":106,"box":{"x":116,"y":831,"width":764,"height":12}},{"id":"55d388cd-afd6-49aa-bfb3-ebebedaa8703","block_type":"box","text":"which may or may not be cleared by a central clearinghouse. In a standard “swap” transaction, two","page_number":106,"box":{"x":116,"y":846,"width":738,"height":12}},{"id":"e7fc0924-3db7-4fb2-9b83-52045f0f41e5","block_type":"box","text":"parties agree to exchange the returns earned or realized from one or more underlying assets or rates","page_number":106,"box":{"x":117,"y":862,"width":755,"height":12}},{"id":"d1d88f6b-7a35-49e0-89a8-f94520f44e8c","block_type":"box","text":"of return, which may be adjusted for an interest factor. The gross returns to be exchanged or","page_number":106,"box":{"x":116,"y":877,"width":693,"height":12}},{"id":"83796838-73e3-4591-970e-3a08af6ec6fa","block_type":"box","text":"II-22","page_number":106,"box":{"x":484,"y":909,"width":31,"height":9}},{"id":"902a8c0b-7cdd-4c35-ae10-b910f57f9466","block_type":"box","text":"NM0926U-5926888-106/257","page_number":106,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"3caa48e1-5ca8-47e4-9709-9beb99a0c5f0","block_type":"box","text":"“swapped” between the parties are generally calculated with respect to a “notional amount,”","page_number":107,"box":{"x":116,"y":87,"width":684,"height":12}},{"id":"5ae78101-8579-4062-9e19-9be4d8684ec3","block_type":"box","text":"e.g.","page_number":107,"box":{"x":801,"y":90,"width":26,"height":9}},{"id":"4c570fcc-f51d-4021-8094-d1b46871715a","block_type":"box","text":", the","page_number":107,"box":{"x":830,"y":87,"width":36,"height":11}},{"id":"5450fd95-0d6a-484f-8f17-95de5a206a48","block_type":"box","text":"return or increase in value of a particular dollar amount invested at a particular interest rate, in a","page_number":107,"box":{"x":117,"y":102,"width":716,"height":12}},{"id":"14aa7fca-4f57-486f-ba4b-8e2401d36a95","block_type":"box","text":"particular foreign currency, or in a “basket” of securities representing a particular index. The notional","page_number":107,"box":{"x":117,"y":118,"width":747,"height":12}},{"id":"527af93f-2ca2-4c02-8e55-a7e24d2f267b","block_type":"box","text":"amount of the swap agreement is only used to calculate the obligations that the parties to a swap","page_number":107,"box":{"x":116,"y":134,"width":726,"height":12}},{"id":"f5e652c8-8669-4c23-91a1-d023f010257e","block_type":"box","text":"agreement have agreed to exchange. A Fund’s obligations (or rights) under a swap agreement will","page_number":107,"box":{"x":116,"y":149,"width":736,"height":12}},{"id":"66b09876-7311-4138-936e-47114df93734","block_type":"box","text":"generally be equal only to the net amount to be paid or received under the agreement based on the","page_number":107,"box":{"x":116,"y":165,"width":743,"height":12}},{"id":"b7916d17-0e3c-4282-b341-0e6b0d71566f","block_type":"box","text":"relative values of the positions held by each party to the agreement. Swaps that are not cleared involve","page_number":107,"box":{"x":117,"y":180,"width":770,"height":12}},{"id":"68cdf973-ec26-4153-83bc-5b0f746381ea","block_type":"box","text":"substantial counterparty risk. A Fund will typically attempt to mitigate this counterparty risk by entering","page_number":107,"box":{"x":116,"y":196,"width":761,"height":12}},{"id":"f87fc611-e342-4dde-878c-ba29c1163bba","block_type":"box","text":"into swap agreements only with creditworthy entities that have substantial capital or that have provided","page_number":107,"box":{"x":117,"y":211,"width":767,"height":12}},{"id":"509b6301-fcd1-42f0-a4a7-43535211c486","block_type":"box","text":"the Fund with a third-party guaranty or other credit support. A Fund’s ability to use swap agreements","page_number":107,"box":{"x":116,"y":227,"width":751,"height":12}},{"id":"b0d16bf0-d5dc-42ef-82bb-bb0a5db31073","block_type":"box","text":"may be restricted by the tax rules applicable to registered investment companies.","page_number":107,"box":{"x":117,"y":242,"width":607,"height":12}},{"id":"d19c1391-2576-47ee-9b45-912eed15e909","block_type":"box","text":"Credit Default Swaps and Similar Instruments.","page_number":107,"box":{"x":117,"y":273,"width":333,"height":12}},{"id":"2282ebc3-997e-4b0b-bb79-4f7f461fb3e9","block_type":"box","text":"Certain Funds may enter into credit default swaps and","page_number":107,"box":{"x":450,"y":273,"width":389,"height":12}},{"id":"35b45689-6ed6-431e-bd8c-384b5960714e","block_type":"box","text":"similar instruments. Credit default swaps are standardi","page_number":107,"box":{"x":116,"y":289,"width":386,"height":12}},{"id":"a7c4af0d-bd6c-4c97-9631-448e9ecacf47","block_type":"box","text":"zed agreements in which the protection “buyer” pays","page_number":107,"box":{"x":503,"y":289,"width":378,"height":12}},{"id":"58865cce-fb44-4082-960e-a3113e4838a6","block_type":"box","text":"the protection “seller” an up-front payment, or a periodic","page_number":107,"box":{"x":116,"y":304,"width":400,"height":12}},{"id":"baf4896d-87b5-4fca-9f8f-cb3b7439fab4","block_type":"box","text":"stream of payments, over the term of the contract,","page_number":107,"box":{"x":517,"y":304,"width":360,"height":12}},{"id":"74ec829e-ae90-4982-8798-195d8aea8234","block_type":"box","text":"provided generally that no credit event on a reference ob","page_number":107,"box":{"x":117,"y":320,"width":401,"height":12}},{"id":"aaa1d638-9caa-45b7-89b0-9ae54cb3ca55","block_type":"box","text":"ligation has occurred. If a credit event occurs, the","page_number":107,"box":{"x":520,"y":320,"width":353,"height":12}},{"id":"0f13aecd-7e87-4606-8fc9-3198170f6159","block_type":"box","text":"seller generally must pay the buyer the difference","page_number":107,"box":{"x":116,"y":335,"width":355,"height":12}},{"id":"3fa4f994-31f8-48bf-9df7-ef3a02465fb3","block_type":"box","text":"between the notional amount of the contract and the","page_number":107,"box":{"x":472,"y":335,"width":375,"height":10}},{"id":"8e20da8d-1057-4d0e-9347-027a1b56aaa1","block_type":"box","text":"value of a portfolio of securities issued by the refere","page_number":107,"box":{"x":116,"y":351,"width":357,"height":12}},{"id":"a27117c6-dbce-4ae0-ab8d-218b711a636b","block_type":"box","text":"rence entity. A Fund may be either the buyer or seller in","page_number":107,"box":{"x":473,"y":351,"width":395,"height":12}},{"id":"b3f86634-cd54-4f35-91e4-63488811fae6","block_type":"box","text":"the transaction. The Funds may enter into credit default","page_number":107,"box":{"x":116,"y":366,"width":398,"height":12}},{"id":"6ebe57c7-7514-4053-bb81-d78277df5f05","block_type":"box","text":"swaps that reference the obligations of a single","page_number":107,"box":{"x":515,"y":366,"width":338,"height":12}},{"id":"1b19fd05-5c74-4217-985f-4de39bc26af8","block_type":"box","text":"entity (“single-name CDS”) or the obli","page_number":107,"box":{"x":116,"y":382,"width":264,"height":12}},{"id":"2b17bfdd-fff1-419f-a46b-c30b2fd93712","block_type":"box","text":"gations of entities that make up an index (“index CDS”). References to","page_number":107,"box":{"x":381,"y":382,"width":504,"height":12}},{"id":"bdcf20d4-26ae-44cf-bae2-f11cf875b304","block_type":"box","text":"“credit default swaps” shall collectively refer to single-name CDS and index CDS.","page_number":107,"box":{"x":116,"y":397,"width":579,"height":12}},{"id":"23cafa08-a328-4c9e-b1f2-eb41d20275f4","block_type":"box","text":"Credit default swaps have as reference obligations one or more securities or loans that are not","page_number":107,"box":{"x":117,"y":428,"width":706,"height":12}},{"id":"0e2609a6-bea0-47bd-8c7b-cc245de0e3d0","block_type":"box","text":"currently held by a Fund. In circumstances in which a Fund does not own the securities or loans that","page_number":107,"box":{"x":116,"y":444,"width":749,"height":12}},{"id":"6cfe7580-0c75-46c2-986e-0015bf2d754d","block_type":"box","text":"are deliverable under a credit default swap, the Fund is exposed to the risk that deliverable securities","page_number":107,"box":{"x":116,"y":459,"width":755,"height":12}},{"id":"942cc621-117b-423e-bf73-8aa4884ea30b","block_type":"box","text":"will not be available in the market, or will be available only at unfavorable prices, as would be the case","page_number":107,"box":{"x":116,"y":475,"width":763,"height":12}},{"id":"bfe975a8-5755-4906-aee7-f1bef88c7219","block_type":"box","text":"in a so-called “short squeeze.” In certain instances of issuer defaults or restructurings, it has been","page_number":107,"box":{"x":117,"y":490,"width":729,"height":12}},{"id":"95560d04-60e7-4d5d-b4e6-bee4d58517d5","block_type":"box","text":"unclear under the standard industry documentation for credit default swaps whether or not a “credit","page_number":107,"box":{"x":117,"y":506,"width":739,"height":12}},{"id":"0c6ec8b2-eaf4-4382-a45a-fc03d09e5a4e","block_type":"box","text":"event” triggering the seller’s payment obligation had occurred. Certain initiatives adopted by derivatives","page_number":107,"box":{"x":116,"y":521,"width":771,"height":12}},{"id":"42442f9c-ffa8-487b-8929-9d7601473967","block_type":"box","text":"market participants, including the International Swaps and Derivatives Association (“ISDA”), are","page_number":107,"box":{"x":117,"y":537,"width":713,"height":12}},{"id":"06d8d6d0-236c-49d2-b879-6a68dad3735d","block_type":"box","text":"designed to implement uniform settlement terms into standard credit default swap documentation, as","page_number":107,"box":{"x":116,"y":552,"width":753,"height":12}},{"id":"605687f1-e088-4e02-9b75-618310353dae","block_type":"box","text":"well as refine the practices for the transparent conduct of the credit default swap market generally.","page_number":107,"box":{"x":116,"y":568,"width":735,"height":12}},{"id":"5e148fef-4b5f-4683-a526-23295910ce09","block_type":"box","text":"Among these initiatives are the ISDA Credit Derivatives Determination Committee and the","page_number":107,"box":{"x":116,"y":583,"width":672,"height":12}},{"id":"00abb9c9-b242-4087-8bcb-378e6c9bdda0","block_type":"box","text":"implementation of market-wide cash settlement protocols applicable to all market-standard credit","page_number":107,"box":{"x":117,"y":599,"width":722,"height":12}},{"id":"7f2e972b-9c26-4ca5-9b21-9c6742220aed","block_type":"box","text":"default swaps. These initiatives are intended to reduce both the uncertainty as to the occurrence of","page_number":107,"box":{"x":116,"y":614,"width":739,"height":12}},{"id":"4eaaeea3-932b-465a-a428-05aac60e06d5","block_type":"box","text":"credit events and the risk of a “short squeeze” by providing that the ISDA Credit Derivatives","page_number":107,"box":{"x":116,"y":630,"width":684,"height":12}},{"id":"51ef4cda-0672-4eb7-9418-46424315e0d7","block_type":"box","text":"Determinations Committee will make determinations as to whether a credit event has occurred,","page_number":107,"box":{"x":117,"y":645,"width":710,"height":11}},{"id":"70939013-9442-4ee6-be09-d314eed673e8","block_type":"box","text":"establish an auction to determine a settlement price and identify the deliverable securities for purposes","page_number":107,"box":{"x":116,"y":661,"width":763,"height":12}},{"id":"bedbf1ba-2c5c-404c-aba4-7f3d583dc931","block_type":"box","text":"of the auction, although the ISDA Credit Derivatives Determinations Committee may in certain limited","page_number":107,"box":{"x":116,"y":676,"width":750,"height":12}},{"id":"0e55eb25-1109-4b73-a663-6cf95145e564","block_type":"box","text":"circumstances refrain from doing so. In the event the ISDA Credit Derivatives Determinations","page_number":107,"box":{"x":116,"y":692,"width":691,"height":12}},{"id":"9c2bdb12-49da-44ac-8852-bb15c5754b96","block_type":"box","text":"Committee cannot reach a timely resolution with respect to a “credit event” or otherwise does not","page_number":107,"box":{"x":117,"y":707,"width":718,"height":12}},{"id":"e85fff52-97c6-443c-85c4-32b643ccd7b1","block_type":"box","text":"establish a cash settlement auction, a Fund may not be able to realize the full value of the credit","page_number":107,"box":{"x":116,"y":723,"width":713,"height":12}},{"id":"3041f14b-a833-45cf-b8a1-2a6d67414aa4","block_type":"box","text":"default swap upon a default by the reference entity. Furthermore, a Fund may enter into certain credit","page_number":107,"box":{"x":116,"y":738,"width":753,"height":12}},{"id":"85730596-85f2-4d7d-93ed-65e364f6fb7d","block_type":"box","text":"default swaps or similar instruments that may not be covered by these initiatives.","page_number":107,"box":{"x":116,"y":754,"width":598,"height":12}},{"id":"fffa4af8-19a3-4c07-a58d-7c7d5440daef","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","page_number":107,"box":{"x":117,"y":785,"width":723,"height":12}},{"id":"d5e6be91-b44d-4f4d-9bd1-c8fe3c3a2061","block_type":"box","text":"recover nothing should no credit event occur. If a Fund is a seller and a credit event occurs, the value","page_number":107,"box":{"x":117,"y":800,"width":752,"height":12}},{"id":"50e529bd-9514-42d1-810e-f51951de5abc","block_type":"box","text":"of any deliverable obligation received by the Fund or the amount of cash settlement received by the","page_number":107,"box":{"x":116,"y":816,"width":738,"height":12}},{"id":"6a5d961d-91f1-4998-a9e9-0ffae3ae9db6","block_type":"box","text":"Fund pursuant to the relevant cash settlement auction, together with the up-front or periodic payments","page_number":107,"box":{"x":117,"y":831,"width":763,"height":12}},{"id":"ed77150d-257b-4e06-ac9c-3e9688c608f8","block_type":"box","text":"previously received, may be less than the amount it pays to the buyer, resulting in a loss of value to the","page_number":107,"box":{"x":117,"y":847,"width":770,"height":12}},{"id":"b2d42291-ad00-4672-b22e-550ff13a8ce0","block_type":"box","text":"Fund. A Fund that sells credit default swaps incurs leveraged exposure to the credit of one or more","page_number":107,"box":{"x":117,"y":862,"width":739,"height":12}},{"id":"6ccd0580-f52f-47cd-a13d-dbca2ec92e78","block_type":"box","text":"reference entities and is subject to many of the same risks it would incur if it were holding debt","page_number":107,"box":{"x":117,"y":878,"width":703,"height":12}},{"id":"f2a32791-e58e-4453-8ff9-8cd53daf154d","block_type":"box","text":"II-23","page_number":107,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"d07f4a62-712b-45cf-8b0d-5a4bba8adb32","block_type":"box","text":"NM0926U-5926888-107/257","page_number":107,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"c7b9f9b3-a1d1-4f86-bca4-0a9c121f9d4f","block_type":"box","text":"securities issued by the relevant reference entity. However, a Fund will not have any legal recourse","page_number":108,"box":{"x":116,"y":87,"width":742,"height":12}},{"id":"5d8e9787-554a-44a4-8e87-07fe5cdf6e87","block_type":"box","text":"against any reference entity and will not benefit from any collateral securing the reference entity’s debt","page_number":108,"box":{"x":116,"y":102,"width":764,"height":13}},{"id":"4f4c15f7-87c1-400a-874c-a3b4841413d8","block_type":"box","text":"obligations. In the event the ISDA Credit Derivatives Determinations Committee does not establish a","page_number":108,"box":{"x":116,"y":118,"width":750,"height":12}},{"id":"0a9ad7e0-c75d-4f58-9bf5-07e249b7242a","block_type":"box","text":"cash settlement auction and identify the relevant deliverable securities or loans, the credit default swap","page_number":108,"box":{"x":116,"y":134,"width":769,"height":12}},{"id":"293709ab-0067-4bf8-9504-23e460688648","block_type":"box","text":"buyer will have broad discretion to select which of the reference entity’s debt obligations to deliver to","page_number":108,"box":{"x":117,"y":149,"width":748,"height":12}},{"id":"d46c5b58-0818-4d9a-afb4-90e98a451369","block_type":"box","text":"the Fund following a credit event and will likely choose the obligations with the lowest market value in","page_number":108,"box":{"x":116,"y":165,"width":755,"height":12}},{"id":"a73c005a-72f4-41b7-a913-858d31908c99","block_type":"box","text":"order to maximize the payment obligations of the Fund. In addition, credit default swaps generally trade","page_number":108,"box":{"x":116,"y":180,"width":772,"height":12}},{"id":"c171b536-ea55-46fb-b7d2-825c7cac645d","block_type":"box","text":"on the basis of theoretical pricing and valuation models, which may not accurately value such swap","page_number":108,"box":{"x":116,"y":196,"width":742,"height":12}},{"id":"eb456313-d4ef-4995-88ee-bcc970445352","block_type":"box","text":"positions when established or when subsequently traded or unwound under actual market conditions.","page_number":108,"box":{"x":117,"y":211,"width":756,"height":12}},{"id":"ce200b5a-b1eb-495b-acdc-71e2ae3262b5","block_type":"box","text":"Dodd-Frank requires that certain index CDS be executed in regulated markets and submitted for","page_number":108,"box":{"x":117,"y":242,"width":719,"height":12}},{"id":"fc72d6f1-1b17-4fbc-9d8a-ce17f0076e29","block_type":"box","text":"clearing to regulated clearinghouses. See “— Derivatives — Regulation of Derivatives — Dodd-Frank","page_number":108,"box":{"x":116,"y":258,"width":757,"height":12}},{"id":"5f3cd679-1b24-437a-9d3e-8b9e8efe585f","block_type":"box","text":"Regulations” above. Other single-name CDS and index CDS are permitted, although not required, to","page_number":108,"box":{"x":117,"y":273,"width":750,"height":12}},{"id":"7fd7a808-fc86-4289-a0e1-29d27295696f","block_type":"box","text":"be cleared through regulated clearinghouses. The Funds clear all credit default swaps that are subject","page_number":108,"box":{"x":117,"y":289,"width":762,"height":12}},{"id":"de72725b-5b37-4835-8179-2c97bf828c28","block_type":"box","text":"to mandatory clearing and may voluntarily clear some, but not all, of the other credit default swaps not","page_number":108,"box":{"x":116,"y":304,"width":762,"height":12}},{"id":"a348dbe7-eef9-4412-a6d5-7e55a592f321","block_type":"box","text":"subject to mandatory clearing. The Funds face counterparty risk with respect to the clearinghouse","page_number":108,"box":{"x":116,"y":320,"width":731,"height":12}},{"id":"e7ed31a1-aa7d-4019-8734-4d3c17ec8c06","block_type":"box","text":"when entering into cleared single-name CDS and cleared index CDS. The Funds face significant","page_number":108,"box":{"x":116,"y":335,"width":722,"height":12}},{"id":"b5f8bb77-6ac9-4c7e-8f40-dc9c64dc5ffb","block_type":"box","text":"counterparty risk with respect to their counterparties to non-cleared credit default swaps and similar","page_number":108,"box":{"x":116,"y":351,"width":743,"height":12}},{"id":"390decc4-5d86-44ce-a980-0ab981bc28d7","block_type":"box","text":"instruments. A Fund typically will enter into non-cleared credit default swaps and similar instruments","page_number":108,"box":{"x":117,"y":366,"width":746,"height":12}},{"id":"01ff3316-df3c-4a41-9ffc-e73082697ac1","block_type":"box","text":"with swap dealers and creditworthy entities that have substantial capital or that have provided the Fund","page_number":108,"box":{"x":116,"y":382,"width":771,"height":12}},{"id":"f1d00b4f-af81-4b36-af60-19921ea0fe4e","block_type":"box","text":"with a third-party guaranty or other credit support.","page_number":108,"box":{"x":116,"y":397,"width":373,"height":12}},{"id":"3d5b8352-578a-4a6e-89b5-8c17deb33990","block_type":"box","text":"In certain instances, a Fund may enter into bespoke credit default swaps or similar instruments either","page_number":108,"box":{"x":117,"y":428,"width":755,"height":12}},{"id":"2df0002a-d86e-4517-9155-0979c5e0e473","block_type":"box","text":"as protection buyer or protection seller. While these contracts are similar in their operation to the","page_number":108,"box":{"x":116,"y":444,"width":720,"height":12}},{"id":"10e24759-978e-4aff-b67d-6e9261fe0875","block_type":"box","text":"market-standard credit default swaps described above, they are less standardized and instead have","page_number":108,"box":{"x":117,"y":459,"width":746,"height":12}},{"id":"24becd13-93b4-4d19-a960-a0e7aab2878a","block_type":"box","text":"bespoke or tailored features. For example, as compared to market-standard credit defaults, the range","page_number":108,"box":{"x":117,"y":475,"width":758,"height":12}},{"id":"2664d305-6c53-4823-a8a7-2f2d9d673d50","block_type":"box","text":"of “credit events” triggering settlement of such bespoke contracts may be narrower or broader, any","page_number":108,"box":{"x":116,"y":490,"width":737,"height":12}},{"id":"9e483ca9-c893-4417-a376-5ab3e00aeb82","block_type":"box","text":"such triggered contracts are settled by physical delivery of the underlying security or loan to or by the","page_number":108,"box":{"x":116,"y":506,"width":755,"height":12}},{"id":"9596922b-4fc3-4ffa-b3ec-79e81e34da4e","block_type":"box","text":"Fund rather than by way of cash settlement, and there may be a wider range of securities as the","page_number":108,"box":{"x":117,"y":521,"width":719,"height":12}},{"id":"f461ad68-bb65-4b55-a9c7-09ff840b6bd9","block_type":"box","text":"reference obligations and/or deliverable obligations.","page_number":108,"box":{"x":117,"y":537,"width":388,"height":12}},{"id":"2a3ab545-bb99-4855-a1bf-46fc6829cca6","block_type":"box","text":"In addition, credit default swaps and similar instruments generally involve greater risks than if a Fund","page_number":108,"box":{"x":117,"y":568,"width":752,"height":12}},{"id":"5e2e311d-09e3-4b4e-900e-6d8acfce6b7b","block_type":"box","text":"had invested in the reference obligation directly and are subject to significant credit risk, correlation","page_number":108,"box":{"x":117,"y":583,"width":738,"height":12}},{"id":"c3a588e2-62f6-47bc-8e0e-f9f79b6fd51a","block_type":"box","text":"risk, leverage risk, illiquidity risk and market risk. See “— Risk Factors in Derivatives” above.","page_number":108,"box":{"x":117,"y":599,"width":689,"height":12}},{"id":"a3d017d4-f36d-4c52-9aff-b722a7bc3a34","block_type":"box","text":"Interest Rate Swaps, Floors and Caps.","page_number":108,"box":{"x":117,"y":630,"width":292,"height":12}},{"id":"f1f1876e-2a4b-49b5-9f79-46e5eed22e97","block_type":"box","text":"Certain Funds may enter into OTC derivatives in the form of","page_number":108,"box":{"x":410,"y":630,"width":450,"height":12}},{"id":"c0b2503f-11c1-4432-bbe7-fb93522dc202","block_type":"box","text":"interest rate swaps and interest rate caps and floors. As described in further detail below, a Fund may","page_number":108,"box":{"x":117,"y":645,"width":760,"height":12}},{"id":"f1135769-f0d7-4da4-9208-29818e888159","block_type":"box","text":"enter into these transactions primarily to preserve a return or spread on a particular investment or","page_number":108,"box":{"x":116,"y":661,"width":724,"height":12}},{"id":"7737d6a7-b143-4398-8657-7c37824d9ed2","block_type":"box","text":"portion of its holdings, as a duration management technique, to protect against an increase in the price","page_number":108,"box":{"x":117,"y":676,"width":762,"height":12}},{"id":"c62f09f8-a3c6-4acf-bd5c-0495f9576bd7","block_type":"box","text":"of securities a Fund anticipates purchasing at a later date, or for speculation to increase returns.","page_number":108,"box":{"x":116,"y":692,"width":712,"height":12}},{"id":"071e2045-4f22-436e-a6b1-08f8f397063d","block_type":"box","text":"Dodd-Frank requires that certain interest rate swaps be executed in regulated markets and submitted","page_number":108,"box":{"x":117,"y":723,"width":750,"height":12}},{"id":"6b5a4fc9-f34f-4772-ae35-651d1984a95b","block_type":"box","text":"for clearing to regulated clearinghouses. See “— Regulation of Derivatives — Dodd-Frank Regulations”","page_number":108,"box":{"x":116,"y":738,"width":766,"height":12}},{"id":"778ab7d4-69f7-42d6-afa8-971769806ccd","block_type":"box","text":"above. Other interest rate swaps are permitted, although not required, to be cleared. Most of the","page_number":108,"box":{"x":116,"y":754,"width":715,"height":12}},{"id":"c034a5ee-5cf4-4b37-a74d-0a873c2bafb3","block_type":"box","text":"interest rate swaps entered into by the Funds are cleared. The Funds face counterparty risk with","page_number":108,"box":{"x":117,"y":769,"width":714,"height":12}},{"id":"88d46278-b4c5-4ea2-a8a6-25e43f88ee9d","block_type":"box","text":"respect to the clearinghouse when entering into cleared interest rate swaps.","page_number":108,"box":{"x":117,"y":785,"width":561,"height":12}},{"id":"68cc7dbb-0714-4743-8ca1-8d7830f8dad6","block_type":"box","text":"The Funds face significant counterparty risk with respect to their counterparties to non-cleared interest","page_number":108,"box":{"x":116,"y":816,"width":759,"height":12}},{"id":"fd23edf4-f9c5-4b2a-b670-73efe2eb223f","block_type":"box","text":"rate swaps and interest rate caps and floors. The typical counterparties for a Fund’s non-cleared","page_number":108,"box":{"x":117,"y":831,"width":719,"height":12}},{"id":"a309e953-b0d7-4690-93dc-f737be2e3e51","block_type":"box","text":"interest rate derivatives transactions are swap dealers and other creditworthy entities that have","page_number":108,"box":{"x":117,"y":847,"width":709,"height":12}},{"id":"6093c14f-c839-412e-8f0c-7ed5909caccc","block_type":"box","text":"substantial capital or that have provided the Fund with a third-party guaranty or other credit support. If","page_number":108,"box":{"x":116,"y":862,"width":760,"height":12}},{"id":"2b7eaaa8-4d6b-4823-badf-c49ec19583ee","block_type":"box","text":"the Fund’s counterparty defaults on such a transaction, a Fund will have contractual remedies with","page_number":108,"box":{"x":116,"y":878,"width":736,"height":12}},{"id":"f76bba9e-749b-4f0e-9f8f-179c3543c8a6","block_type":"box","text":"II-24","page_number":108,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"08f96045-b4af-4277-9c47-9a23525d1dbf","block_type":"box","text":"NM0926U-5926888-108/257","page_number":108,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"aad93be6-d5e5-409f-9c1d-16b2f9918df3","block_type":"box","text":"respect to the transaction, but there can be no guarantee that the Fund will be successful in enforcing","page_number":109,"box":{"x":117,"y":87,"width":758,"height":12}},{"id":"124f37fe-936c-4dee-a0f5-0df448fdd2d4","block_type":"box","text":"such remedies. The market for interest rate swaps is relatively liquid in comparison with other similar","page_number":109,"box":{"x":116,"y":102,"width":751,"height":13}},{"id":"634251ee-9626-4ebb-b107-377cc74868dc","block_type":"box","text":"instruments traded in the interbank market. A Fund may be limited in its ability to enter into certain","page_number":109,"box":{"x":117,"y":118,"width":732,"height":12}},{"id":"c6ed0a48-5fb2-4b62-a6fb-d4caeb20d5af","block_type":"box","text":"interest rate derivatives due to applicable income tax requirements.","page_number":109,"box":{"x":117,"y":134,"width":503,"height":11}},{"id":"feaa7550-0491-451d-8e30-b1514903c270","block_type":"box","text":"Interest rate swaps are transactions in which each party makes periodic interest payments based on a","page_number":109,"box":{"x":117,"y":163,"width":762,"height":12}},{"id":"686fa1e1-3c64-4917-b6b2-a73e53250820","block_type":"box","text":"fixed or variable interest rate, index or asset in return for periodic payments from its counterparty based","page_number":109,"box":{"x":116,"y":178,"width":772,"height":12}},{"id":"9c465ec7-f6d4-462b-8817-85cff677f2d9","block_type":"box","text":"on a different fixed or variable interest rate, index or asset.","page_number":109,"box":{"x":116,"y":194,"width":439,"height":11}},{"id":"c9ce1820-9e02-4379-a1db-f4e16e832076","block_type":"box","text":"The purchase of an interest rate floor entitles the purchaser, to the extent that a specified index falls","page_number":109,"box":{"x":116,"y":223,"width":746,"height":12}},{"id":"7b2da02b-55a7-4ece-bee9-299920afbe41","block_type":"box","text":"below a predetermined interest rate, to receive payments of interest on a notional principal amount","page_number":109,"box":{"x":117,"y":239,"width":736,"height":12}},{"id":"cc6e58e5-0906-42ad-8a69-f32364788459","block_type":"box","text":"from the party selling such interest rate floor.","page_number":109,"box":{"x":116,"y":254,"width":337,"height":12}},{"id":"3f7e5834-aff3-4d94-adaa-0de20a9377be","block_type":"box","text":"The purchase of an interest rate cap entitles the purchaser, to the extent that a specified index rises","page_number":109,"box":{"x":116,"y":283,"width":746,"height":12}},{"id":"9883988d-658b-45e3-8447-987befa799dd","block_type":"box","text":"above a predetermined interest rate, to receive payments of interest on a notional principal amount","page_number":109,"box":{"x":116,"y":299,"width":739,"height":12}},{"id":"4554069c-1189-4520-8f00-0233be810639","block_type":"box","text":"from the party selling such interest rate cap.","page_number":109,"box":{"x":116,"y":314,"width":331,"height":12}},{"id":"6d590e72-5998-40ad-978e-8fa31ce406f3","block_type":"box","text":"A Fund may enter into an interest rate swap to effectively exchange with another party their respective","page_number":109,"box":{"x":116,"y":344,"width":764,"height":12}},{"id":"3bc5aeb4-62d0-4785-b08f-958d4d6148aa","block_type":"box","text":"commitments to pay or receive interest,","page_number":109,"box":{"x":116,"y":359,"width":298,"height":12}},{"id":"f4b88452-d45b-4a44-a591-2cb62fb6df18","block_type":"box","text":"e.g.","page_number":109,"box":{"x":415,"y":362,"width":26,"height":9}},{"id":"7a77a83f-c8af-43b1-aaa0-155245f272c6","block_type":"box","text":", an exchange of fixed rate payments for floating rate","page_number":109,"box":{"x":444,"y":359,"width":396,"height":12}},{"id":"7c9b0f29-1b64-406c-ba56-5c04556b36a9","block_type":"box","text":"payments. For example, if a Fund holds a mortgage-backed security with an interest rate that is reset","page_number":109,"box":{"x":117,"y":375,"width":755,"height":12}},{"id":"9d95a189-17a6-4737-9efb-33b8264e512d","block_type":"box","text":"only once each year, it may swap the right to receive interest at this fixed rate for the right to receive","page_number":109,"box":{"x":116,"y":390,"width":748,"height":12}},{"id":"8c26e5df-c2ef-4704-9f02-45bff756f7e6","block_type":"box","text":"interest at a rate that is reset every week. This would enable a Fund to offset a decline in the value of","page_number":109,"box":{"x":117,"y":406,"width":755,"height":12}},{"id":"e5875e73-9b4d-4222-93e6-bacd1115100c","block_type":"box","text":"the mortgage-backed security due to rising interest rates but would also limit its ability to benefit from","page_number":109,"box":{"x":116,"y":421,"width":753,"height":12}},{"id":"cd05cfbc-4858-4a8e-ab7a-25109fb99fbf","block_type":"box","text":"falling interest rates. Conversely, if a Fund holds a mortgage-backed security with an interest rate that","page_number":109,"box":{"x":116,"y":437,"width":761,"height":12}},{"id":"31c75ac2-ba93-4569-9977-3cbb04c884ee","block_type":"box","text":"is reset every week and it would like to lock in what","page_number":109,"box":{"x":117,"y":452,"width":383,"height":12}},{"id":"6da31a55-ed7b-4e7b-bdc9-383e88b3f97f","block_type":"box","text":"it believes to be a high interest rate for one year, it","page_number":109,"box":{"x":501,"y":452,"width":377,"height":12}},{"id":"c0e9e38e-999c-4a8d-a580-807a9bc26ae3","block_type":"box","text":"may swap the right to receive interest at this variable weekly rate for the right to receive interest at a","page_number":109,"box":{"x":117,"y":468,"width":746,"height":12}},{"id":"03d86a6a-25c3-4112-bf8a-2f372fcbae3d","block_type":"box","text":"rate that is fixed for one year. Such a swap would protect the Fund from a reduction in yield due to","page_number":109,"box":{"x":117,"y":483,"width":733,"height":12}},{"id":"baf6ba0b-702c-4ab8-9227-996e16ea74a5","block_type":"box","text":"falling interest rates and may permit the Fund to enhance its income through the positive differential","page_number":109,"box":{"x":116,"y":499,"width":745,"height":12}},{"id":"897f4b22-f67d-4211-ae32-3e975079c4cc","block_type":"box","text":"between one week and one year interest rates, but would preclude it from taking full advantage of","page_number":109,"box":{"x":117,"y":514,"width":729,"height":12}},{"id":"47e22d85-7575-4bb9-9daf-9ee7333a4e6c","block_type":"box","text":"rising interest rates.","page_number":109,"box":{"x":117,"y":530,"width":150,"height":12}},{"id":"ac1caf25-55fe-4fd1-80ec-4f1f50449a59","block_type":"box","text":"Gains from transactions in interest rate swaps distributed to shareholders will be taxable as ordinary","page_number":109,"box":{"x":117,"y":559,"width":746,"height":12}},{"id":"809c35de-9184-42a5-95e7-7fc01ff5eeaf","block_type":"box","text":"income or, in certain circumstances, as long term capital gains to shareholders.","page_number":109,"box":{"x":117,"y":575,"width":593,"height":12}},{"id":"c98a00fb-4090-4ac9-9079-2c9f64b8cec8","block_type":"box","text":"Interest rate swaps and interest rate caps and floors may be subject to correlation risk, leverage risk,","page_number":109,"box":{"x":117,"y":604,"width":751,"height":12}},{"id":"52a49ed0-0286-4361-b096-8a12ab7d2b30","block_type":"box","text":"illiquidity risk and market risk. See “— Risk Factors in Derivatives” above.","page_number":109,"box":{"x":117,"y":619,"width":549,"height":12}},{"id":"e1ccea45-9dd9-4140-aa80-b69f12d9eb0b","block_type":"box","text":"Total Return Swaps.","page_number":109,"box":{"x":118,"y":648,"width":155,"height":12}},{"id":"c98279a3-316e-4144-b551-11b97a82d9d2","block_type":"box","text":"Total return swaps are contracts in which one party agrees to make periodic","page_number":109,"box":{"x":273,"y":649,"width":570,"height":12}},{"id":"8bd10af5-52a5-4dd1-8c6b-29ce08d7de44","block_type":"box","text":"payments to the other party based on the return of the assets underlying the contract in exchange for","page_number":109,"box":{"x":117,"y":664,"width":750,"height":12}},{"id":"34b208b6-0c15-4022-9e06-67d82a384da7","block_type":"box","text":"periodic payments based on a fixed or variable interest rate or the total return from different underlying","page_number":109,"box":{"x":117,"y":679,"width":759,"height":13}},{"id":"de5f58a5-5415-49ae-8d6a-7a6c8c1ae959","block_type":"box","text":"assets. The return of the assets underlying the contract includes both the income generated by the","page_number":109,"box":{"x":116,"y":695,"width":732,"height":12}},{"id":"f49a2054-f695-4d3b-ac39-5444029c42b6","block_type":"box","text":"asset and the change in market value of the asset. The asset underlying the contract may include a","page_number":109,"box":{"x":116,"y":710,"width":737,"height":13}},{"id":"d9fe57a9-718c-4e25-ad78-d3065baa49e1","block_type":"box","text":"specified security, basket of securities or securities indices. Total return swaps on a specified security,","page_number":109,"box":{"x":116,"y":726,"width":757,"height":12}},{"id":"e15d19d6-bc9d-4e47-a9d6-bafb785d4314","block_type":"box","text":"basket of securities or securities indices may sometimes be referred to as “contracts for difference.”","page_number":109,"box":{"x":117,"y":741,"width":738,"height":13}},{"id":"3876c31c-c1fa-4332-8f63-76d07884a7b0","block_type":"box","text":"Total return swaps may be used to obtain exposure to a security or market without owning or taking","page_number":109,"box":{"x":116,"y":771,"width":738,"height":12}},{"id":"a5b60170-d185-4f81-ab2a-c31c62dd10a7","block_type":"box","text":"physical custody of such security or investing directly in such market. Upon entering into a total return","page_number":109,"box":{"x":117,"y":786,"width":752,"height":12}},{"id":"a147ac3c-9f91-4694-aceb-05733f0e2fb1","block_type":"box","text":"swap, a Fund is required to deposit initial margin but the parties do not exchange the notional amount.","page_number":109,"box":{"x":116,"y":802,"width":757,"height":12}},{"id":"9bcd5241-e0b9-4ebd-bcc4-b7b21e19389c","block_type":"box","text":"As a result, total return swaps may effectively add leverage to the Fund’s portfolio because the Fund","page_number":109,"box":{"x":116,"y":817,"width":744,"height":12}},{"id":"fc631a6d-fa4f-444b-9372-f0f3e6829a6a","block_type":"box","text":"would be subject to investment exposure on the notional amount of the swap.","page_number":109,"box":{"x":116,"y":833,"width":580,"height":12}},{"id":"f00ec87d-117a-4b78-868b-961e2b9c7c90","block_type":"box","text":"Total return swaps are subject to significant correlation risk, leverage risk, illiquidity risk, market risk","page_number":109,"box":{"x":116,"y":862,"width":743,"height":12}},{"id":"41a5d559-b468-4958-a03d-1d4648b45cb1","block_type":"box","text":"and counterparty risk. See “— Risk Factors in Derivatives” above.","page_number":109,"box":{"x":116,"y":877,"width":493,"height":13}},{"id":"11139d9e-3f6a-4d55-bf54-c0077d8dfe30","block_type":"box","text":"II-25","page_number":109,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"8e185c9c-af03-4985-a363-0e264bd383eb","block_type":"box","text":"NM0926U-5926888-109/257","page_number":109,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"531cf1e4-ba4a-4e36-a286-356ab85b52d2","block_type":"box","text":"Options.","page_number":110,"box":{"x":117,"y":87,"width":66,"height":12}},{"id":"4c9e7728-eb01-44dd-a0aa-694ca65ef72a","block_type":"box","text":"Options on Securities and Securities Indices.","page_number":110,"box":{"x":117,"y":110,"width":337,"height":12}},{"id":"2bd52253-a28c-403f-b920-fbc1887b213e","block_type":"box","text":"A Fund may engage in transactions in options on","page_number":110,"box":{"x":454,"y":110,"width":370,"height":12}},{"id":"7b75bac0-b3d3-4959-92cf-dc00e3d19bf1","block_type":"box","text":"individual securities, baskets of securities or securities indices, or particular measurements of value or","page_number":110,"box":{"x":117,"y":126,"width":761,"height":12}},{"id":"e1297c55-91f2-40a4-b7fe-e6bf596f0d5a","block_type":"box","text":"rates, such as an index of the price of treasury securities or an index representative of short-term","page_number":110,"box":{"x":117,"y":141,"width":724,"height":12}},{"id":"3d2008c0-ed3f-4f98-b4b9-02b21a945eeb","block_type":"box","text":"interest rates. Such investments may be made on exchanges and in the OTC markets. In general,","page_number":110,"box":{"x":117,"y":157,"width":732,"height":12}},{"id":"923b7f45-e879-44d0-b8f1-9a834cfcb80f","block_type":"box","text":"exchange-traded options have standardized exercise prices and expiration dates and require the","page_number":110,"box":{"x":116,"y":172,"width":723,"height":12}},{"id":"891d2b5c-debe-4037-8b34-321ef1a2f825","block_type":"box","text":"parties to post margin against their obligations, and the performance of the parties’ obligations in","page_number":110,"box":{"x":117,"y":188,"width":720,"height":12}},{"id":"4e739873-441c-4c61-b7a1-564c239099b7","block_type":"box","text":"connection with such options is guaranteed by the exchange or a related clearing corporation. OTC","page_number":110,"box":{"x":116,"y":203,"width":742,"height":12}},{"id":"9155cbc1-74d9-4c5d-b63d-84079b950c16","block_type":"box","text":"options have more flexible terms negotiated between the buyer and the seller, but are subject to","page_number":110,"box":{"x":116,"y":219,"width":717,"height":12}},{"id":"979928ee-ab06-4e3f-9ac1-b995834eb316","block_type":"box","text":"greater credit risk. OTC options also involve greater illiquidity risk.","page_number":110,"box":{"x":116,"y":234,"width":493,"height":12}},{"id":"9909a8fb-73d5-45d3-b001-8bb17dadb47a","block_type":"box","text":"A Fund may also engage in transactions in options which have additional features that result in","page_number":110,"box":{"x":116,"y":265,"width":709,"height":12}},{"id":"e514397e-bf2c-4d84-a462-bd02a728aae1","block_type":"box","text":"different payment structures and/or expirations (commonly referred to as exotic options). For example,","page_number":110,"box":{"x":116,"y":281,"width":765,"height":12}},{"id":"7173ddc9-18e6-46c3-80cc-8ad9652f97aa","block_type":"box","text":"barrier options are exotic options that can only be exercised (or automatically expire) if the price of the","page_number":110,"box":{"x":117,"y":296,"width":761,"height":12}},{"id":"66c9d01a-af20-4f2e-a664-079ddea13412","block_type":"box","text":"underlying asset reaches one or more predetermined levels on or before expiration. Binary options are","page_number":110,"box":{"x":117,"y":312,"width":765,"height":12}},{"id":"9b752eb0-cddc-469b-9ac1-9e8b4b50a234","block_type":"box","text":"another example of exotic options which have a fixed all-or-nothing payout if one or more","page_number":110,"box":{"x":116,"y":327,"width":666,"height":12}},{"id":"7b4917ce-e1f4-4de8-bba0-214009068daa","block_type":"box","text":"predetermined conditions are met. Exotic options are typically traded in OTC markets.","page_number":110,"box":{"x":117,"y":343,"width":641,"height":12}},{"id":"05c58fbd-736f-47b9-b98e-799df2bdb06d","block_type":"box","text":"There are several risks associated with transactions in options on securities and indexes. For example,","page_number":110,"box":{"x":116,"y":374,"width":770,"height":12}},{"id":"1d9f3f0c-b7e9-487d-b803-a9c3a4b022c8","block_type":"box","text":"there are significant differences between the securities and options markets that could result in an","page_number":110,"box":{"x":116,"y":389,"width":731,"height":12}},{"id":"a52089b8-67d4-4639-8add-14b631ba0a2b","block_type":"box","text":"imperfect correlation between these markets, causing a given transaction not to achieve its objectives.","page_number":110,"box":{"x":117,"y":405,"width":763,"height":12}},{"id":"4375974a-659a-4cdc-a0fa-9c1145285656","block_type":"box","text":"In addition, a liquid market for particular options, whether traded OTC or on a national securities","page_number":110,"box":{"x":117,"y":420,"width":716,"height":12}},{"id":"76908ea8-c3f4-4fd0-aeb4-9a4cf08c73e1","block_type":"box","text":"exchange (“Exchange”) may be absent for reasons which include the following: there may be","page_number":110,"box":{"x":116,"y":436,"width":695,"height":12}},{"id":"05edf8c8-67b1-436c-a4ac-1f233dc8f864","block_type":"box","text":"insufficient trading interest in certain options; restrictions may be imposed by an Exchange on opening","page_number":110,"box":{"x":117,"y":451,"width":763,"height":12}},{"id":"80e6e967-cd37-4d37-9c36-613343a36e56","block_type":"box","text":"transactions or closing transactions or both; trading halts, suspensions or other restrictions may be","page_number":110,"box":{"x":116,"y":467,"width":737,"height":12}},{"id":"ce305d22-62bf-4bb6-bd7e-4af394976f49","block_type":"box","text":"imposed with respect to particular classes or series of options or underlying securities; unusual or","page_number":110,"box":{"x":117,"y":482,"width":727,"height":12}},{"id":"7847c09d-c272-4d27-a509-c6f176808ad4","block_type":"box","text":"unforeseen circumstances may interrupt normal operations on an Exchange; the facilities of an","page_number":110,"box":{"x":117,"y":498,"width":708,"height":12}},{"id":"9a9fec4f-e843-47af-b249-1f63c8d57106","block_type":"box","text":"Exchange or the Options Clearing Corporation may not at all times be adequate to handle current","page_number":110,"box":{"x":117,"y":513,"width":728,"height":12}},{"id":"7cf57ca8-e9ae-4346-b134-54deb06d43ac","block_type":"box","text":"trading volume; or one or more Exchanges could, for economic or other reasons, decide or be","page_number":110,"box":{"x":116,"y":529,"width":703,"height":12}},{"id":"76861fd0-5763-4437-82d6-f5eb9567c356","block_type":"box","text":"compelled at some future date to discontinue the trading of options (or a particular class or series of","page_number":110,"box":{"x":116,"y":544,"width":746,"height":12}},{"id":"8afe4652-303d-4632-a0bc-ad559251c5ab","block_type":"box","text":"options), in which event the market on that Exchange (or in that class or series of options) would cease","page_number":110,"box":{"x":116,"y":560,"width":770,"height":12}},{"id":"d8f1499a-54cc-4baa-9774-68569d82831a","block_type":"box","text":"to exist, although outstanding options that had been issued by the Options Clearing Corporation as a","page_number":110,"box":{"x":116,"y":575,"width":753,"height":12}},{"id":"73745375-38a4-486d-be05-19eacee6fa74","block_type":"box","text":"result of trades on that Exchange would continue to be exercisable in accordance with their terms.","page_number":110,"box":{"x":117,"y":591,"width":732,"height":12}},{"id":"e6421878-a22b-405e-8261-ab7b2c2f2e0b","block_type":"box","text":"Each of the options exchanges has established limitations governing the maximum number of call or","page_number":110,"box":{"x":117,"y":622,"width":749,"height":12}},{"id":"814b8101-1d48-45ca-8c5e-cbb9bd0c088b","block_type":"box","text":"put options on the same asset that may be bought or written by a single investor, whether acting alone","page_number":110,"box":{"x":117,"y":638,"width":764,"height":11}},{"id":"4c6bc9ff-0ad6-4260-83fa-9843449d7c63","block_type":"box","text":"or in concert with others (regardless of whether such options are written on the same or different","page_number":110,"box":{"x":116,"y":653,"width":720,"height":12}},{"id":"921e4290-75b6-45f1-b886-c86d45e59b5a","block_type":"box","text":"exchanges or are held or written on one or more accounts or through one or more brokers). Under","page_number":110,"box":{"x":116,"y":668,"width":730,"height":12}},{"id":"c58f5533-a604-4e52-8a21-4d0ea4775e3a","block_type":"box","text":"these limitations, option positions of all investment companies advised by the Manager are combined","page_number":110,"box":{"x":116,"y":684,"width":749,"height":12}},{"id":"bcd91711-4c7c-417b-a07a-006e07906b55","block_type":"box","text":"for purposes of these limits. Pursuant to these limitations, an exchange may order the liquidation of","page_number":110,"box":{"x":116,"y":699,"width":736,"height":13}},{"id":"3b2b7fb7-486c-4db0-a6e8-2a216111cd50","block_type":"box","text":"positions and may impose other sanctions or restrictions. These position limits may restrict the number","page_number":110,"box":{"x":117,"y":715,"width":762,"height":12}},{"id":"a02546a3-c2d8-4130-a55b-c5b45a4c71bd","block_type":"box","text":"of listed options that a Fund may buy or sell.","page_number":110,"box":{"x":116,"y":730,"width":328,"height":13}},{"id":"847a75b8-d820-4ae0-8c05-184ebaaaa085","block_type":"box","text":"Call Options.","page_number":110,"box":{"x":117,"y":761,"width":93,"height":12}},{"id":"2da3ab52-4e27-4b35-b62e-927b5bd9e9bd","block_type":"box","text":"A Fund may purchase call options on any of the types of securities or instruments in","page_number":110,"box":{"x":217,"y":761,"width":623,"height":13}},{"id":"137d3573-e199-4351-a3fb-fdbe61ed45ba","block_type":"box","text":"which it may invest. A purchased call option gives a Fund the right to buy, and obligates the seller to","page_number":110,"box":{"x":116,"y":777,"width":743,"height":12}},{"id":"412e6b93-3699-498e-bb74-910e5e5b007d","block_type":"box","text":"sell, the underlying security at the exercise price at any time during the option period. A Fund also may","page_number":110,"box":{"x":116,"y":793,"width":762,"height":12}},{"id":"878f77ec-2041-4be5-a322-8f88dbeabff4","block_type":"box","text":"purchase and sell call options on indices. Index options are similar to options on securities except that,","page_number":110,"box":{"x":117,"y":808,"width":759,"height":12}},{"id":"1b7dabd9-6cce-403f-b08b-0e5652d0d03e","block_type":"box","text":"rather than taking or making delivery of securities underlying the option at a specified price upon","page_number":110,"box":{"x":117,"y":823,"width":712,"height":13}},{"id":"8ad28725-2de0-4442-af17-870829a0750f","block_type":"box","text":"exercise, an index option gives the holder the right to receive cash upon exercise of the option if the","page_number":110,"box":{"x":116,"y":839,"width":745,"height":12}},{"id":"bf70031e-2713-4974-9c39-e5b4c5035a5e","block_type":"box","text":"level of the index upon which the option is based is greater than the exercise price of the option.","page_number":110,"box":{"x":117,"y":854,"width":716,"height":13}},{"id":"92abed9d-2974-4b70-a098-88fd45670997","block_type":"box","text":"II-26","page_number":110,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"94b15baa-cce8-4f81-a5b7-02e4a1590e89","block_type":"box","text":"NM0926U-5926888-110/257","page_number":110,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"0394d94a-f4c2-40ed-9ac0-0edc1f0f4450","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","page_number":111,"box":{"x":116,"y":87,"width":750,"height":12}},{"id":"fe5ad668-9f2c-4657-a246-4ba103e9838c","block_type":"box","text":"where the exercise price of the call held is (i) equal to or less than the exercise price of the call written,","page_number":111,"box":{"x":116,"y":102,"width":765,"height":13}},{"id":"e1f71b14-7980-43e2-846e-f2d3b2cdd92b","block_type":"box","text":"or (ii) greater than the exercise price of the call written provided the difference is maintained by the","page_number":111,"box":{"x":116,"y":118,"width":736,"height":12}},{"id":"4052d849-dd0d-4dbd-b941-88b866aa43f2","block_type":"box","text":"Fund in assets which are not considered illiquid investments under the Funds’ Liquidity Program (as","page_number":111,"box":{"x":117,"y":134,"width":745,"height":12}},{"id":"04f7707c-d37b-4df6-987a-337894076d42","block_type":"box","text":"defined below) (“liquid assets”) designated on the Manager’s or the sub-adviser’s books and records to","page_number":111,"box":{"x":116,"y":149,"width":769,"height":12}},{"id":"a4dfd398-f933-45ab-8381-950a7c341944","block_type":"box","text":"the extent required by Commission guidelines.","page_number":111,"box":{"x":116,"y":165,"width":350,"height":12}},{"id":"c1547359-ff62-4edd-bb1d-34f692133d56","block_type":"box","text":"A Fund may write (","page_number":111,"box":{"x":116,"y":196,"width":140,"height":12}},{"id":"f3867448-109b-4edd-a441-98dfb7e5cd00","block_type":"box","text":"i.e.","page_number":111,"box":{"x":257,"y":196,"width":21,"height":9}},{"id":"dd03cef1-2ad7-4afc-8713-48e62cc96a72","block_type":"box","text":", sell) covered call options on the securities or instruments in which it may invest","page_number":111,"box":{"x":281,"y":196,"width":599,"height":12}},{"id":"76592748-4f7c-48ff-81cb-57fdd79283e6","block_type":"box","text":"and to enter into closing purchase transactions with respect to certain of such options. A covered call","page_number":111,"box":{"x":116,"y":211,"width":754,"height":12}},{"id":"bab5c8c7-b87e-4ca8-a4a3-88ec90689701","block_type":"box","text":"option is an option in which a Fund, in return for a premium, gives another party a right to buy specified","page_number":111,"box":{"x":116,"y":227,"width":769,"height":12}},{"id":"c79990f1-8b60-4b81-b404-2ea9c9b3164b","block_type":"box","text":"securities owned by the Fund at a specified future date and price set at the time of the contract. The","page_number":111,"box":{"x":116,"y":242,"width":747,"height":12}},{"id":"1cd81789-ed2f-4b35-ac44-1b540d8e57d9","block_type":"box","text":"principal reason for writing call options is the attempt to realize, through the receipt of premiums, a","page_number":111,"box":{"x":117,"y":258,"width":733,"height":12}},{"id":"6dac7a4e-ed3f-4e86-afe7-65723d392813","block_type":"box","text":"greater return than would be realized on the securities alone. By writing covered call options, a Fund","page_number":111,"box":{"x":116,"y":273,"width":750,"height":12}},{"id":"0e88fa61-06a8-45fd-b6fb-eba2a8da7206","block_type":"box","text":"gives up the opportunity, while the option is in effect, to profit from any price increase in the underlying","page_number":111,"box":{"x":116,"y":289,"width":763,"height":12}},{"id":"46c204d7-1a7b-4d8c-aa7a-048bae63df2f","block_type":"box","text":"security above the option exercise price. In addition, a Fund’s ability to sell the underlying security will","page_number":111,"box":{"x":116,"y":304,"width":758,"height":12}},{"id":"b17ab1b5-2714-4e1e-b9d6-7e2109669853","block_type":"box","text":"be limited while the option is in effect unless the Fund enters into a closing purchase transaction. A","page_number":111,"box":{"x":117,"y":320,"width":738,"height":12}},{"id":"e84cf33e-beb8-41db-b43b-9f945388b642","block_type":"box","text":"closing purchase transaction cancels out a Fund’s position as the writer of an option by means of an","page_number":111,"box":{"x":116,"y":335,"width":748,"height":12}},{"id":"d2f38aac-09e3-4f9d-aa80-31308d552143","block_type":"box","text":"offsetting purchase of an identical option prior to the expiration of the option it has written. Covered call","page_number":111,"box":{"x":116,"y":351,"width":768,"height":12}},{"id":"de1730e4-41be-4d79-a2ea-a5bb463fa904","block_type":"box","text":"options also serve as a partial hedge to the extent of the premium received against the price of the","page_number":111,"box":{"x":116,"y":366,"width":736,"height":12}},{"id":"c6264c17-a39a-4e4c-81b6-315ca1be3e33","block_type":"box","text":"underlying security declining.","page_number":111,"box":{"x":117,"y":382,"width":219,"height":12}},{"id":"9c809057-0e37-47c7-8ad1-3db525506274","block_type":"box","text":"A Fund may write (","page_number":111,"box":{"x":116,"y":413,"width":140,"height":12}},{"id":"1b505063-7ddc-4ce8-aa60-55d1ef6c4dce","block_type":"box","text":"i.e.","page_number":111,"box":{"x":257,"y":413,"width":21,"height":9}},{"id":"7fc63f85-240b-46fe-aaf9-e6ac8863189a","block_type":"box","text":", sell) uncovered call options on securities or instruments in which it may invest","page_number":111,"box":{"x":281,"y":413,"width":590,"height":12}},{"id":"02610620-a897-4b4f-8f74-964c73064353","block_type":"box","text":"but that are not currently held by the Fund. The principal reason for writing uncovered call options is to","page_number":111,"box":{"x":117,"y":428,"width":763,"height":12}},{"id":"5c980d92-1484-4774-8997-417caeb0c6ae","block_type":"box","text":"realize income without committing capital to the ownership of the underlying securities or instruments.","page_number":111,"box":{"x":117,"y":444,"width":758,"height":12}},{"id":"22280396-7088-429c-aeaa-c2ae6c1a4403","block_type":"box","text":"When writing uncovered call options, a Fund must deposit and maintain sufficient margin with the","page_number":111,"box":{"x":116,"y":459,"width":727,"height":12}},{"id":"7ce53fb0-c6a0-4013-8a58-aaf72b26c90b","block_type":"box","text":"broker-dealer through which it made the uncovered call option as collateral to ensure that the securities","page_number":111,"box":{"x":117,"y":475,"width":771,"height":12}},{"id":"861d9151-f63f-4d34-91ef-cc59256026bc","block_type":"box","text":"can be purchased for delivery if and when the option is exercised. During periods of declining","page_number":111,"box":{"x":116,"y":490,"width":697,"height":12}},{"id":"36c7b0b9-254d-4a64-975e-345b48ce5d87","block_type":"box","text":"securities prices or when prices are stable, writing uncovered calls can be a profitable strategy to","page_number":111,"box":{"x":116,"y":506,"width":724,"height":12}},{"id":"defe0488-7684-433d-bf3c-65009ac68bdf","block_type":"box","text":"increase a Fund’s income with minimal capital risk. Uncovered calls are riskier than covered calls","page_number":111,"box":{"x":117,"y":521,"width":724,"height":12}},{"id":"b1454e19-2ce4-4f32-8b9a-5a040ddd41db","block_type":"box","text":"because there is no underlying security held by a Fund that can act as a partial hedge. Uncovered calls","page_number":111,"box":{"x":117,"y":537,"width":771,"height":12}},{"id":"683ddf51-e37f-44b5-8add-563da5f8e527","block_type":"box","text":"have speculative characteristics and the potential for loss is unlimited. When an uncovered call is","page_number":111,"box":{"x":117,"y":552,"width":725,"height":12}},{"id":"adc67a74-5ae5-4bc5-9bcf-75904941e3af","block_type":"box","text":"exercised, a Fund must purchase the underlying security to meet its call obligation. There is also a risk,","page_number":111,"box":{"x":116,"y":568,"width":771,"height":12}},{"id":"6cd039aa-fef9-47b5-be56-24925cae8dc9","block_type":"box","text":"especially with preferred and debt securities that lack sufficient liquidity, that the securities may not be","page_number":111,"box":{"x":116,"y":583,"width":760,"height":12}},{"id":"1eaef7a0-d4b0-4d7b-b010-0b51fbe80d8c","block_type":"box","text":"available for purchase. If the purchase price exceeds the exercise price, a Fund will lose the difference.","page_number":111,"box":{"x":116,"y":599,"width":772,"height":12}},{"id":"75da2615-86cf-4a0d-ac2b-d1ab194d49ff","block_type":"box","text":"Put Options.","page_number":111,"box":{"x":116,"y":630,"width":97,"height":12}},{"id":"fbeadded-afce-4130-b9eb-8a76db7eb1b2","block_type":"box","text":"A Fund may purchase put options to seek to hedge against a decline in the value of its","page_number":111,"box":{"x":213,"y":630,"width":648,"height":12}},{"id":"f3255b86-a926-47a2-9bf2-d538ed5f265f","block_type":"box","text":"securities or to enhance its return. By buying a put option, a Fund acquires a right to sell the underlying","page_number":111,"box":{"x":116,"y":645,"width":770,"height":12}},{"id":"529d2dec-b327-468a-ac08-315aafeaa4b8","block_type":"box","text":"securities or instruments at the exercise price, thus limiting the Fund’s risk of loss through a decline in","page_number":111,"box":{"x":116,"y":661,"width":754,"height":12}},{"id":"bf0820ad-2b93-41fb-b9a5-6db393342a5d","block_type":"box","text":"the market value of the securities or instruments until the put option expires. The amount of any","page_number":111,"box":{"x":116,"y":676,"width":709,"height":12}},{"id":"1938aa10-3c96-4430-a2e1-7c4680387614","block_type":"box","text":"appreciation in the value of the underlying securities or instruments will be partially offset by the","page_number":111,"box":{"x":116,"y":692,"width":708,"height":12}},{"id":"ad8d854d-b0c9-415b-a1c0-fc7a21e09044","block_type":"box","text":"amount of the premium paid for the put option and any related transaction costs. Prior to its expiration,","page_number":111,"box":{"x":116,"y":707,"width":758,"height":12}},{"id":"2db8b218-09ef-4bbe-8c73-c390f3ddd045","block_type":"box","text":"a put option may be sold in a closing sale transaction and profit or loss from the sale will depend on","page_number":111,"box":{"x":116,"y":723,"width":737,"height":12}},{"id":"3cc41f4f-bcf3-49ee-86f0-3fd83e4e36df","block_type":"box","text":"whether the amount received is more or less than the premium paid for the put option plus the related","page_number":111,"box":{"x":116,"y":738,"width":753,"height":12}},{"id":"000a083e-e170-4044-945a-3643127b782a","block_type":"box","text":"transaction costs. A closing sale transaction cancels out a Fund’s position as the purchaser of an","page_number":111,"box":{"x":116,"y":754,"width":719,"height":12}},{"id":"8716cdeb-64b4-4484-8c80-98e8eab7f31f","block_type":"box","text":"option by means of an offsetting sale of an identical option prior to the expiration of the option it has","page_number":111,"box":{"x":116,"y":769,"width":737,"height":12}},{"id":"f303fefa-ddaf-4d11-89a8-d3eb5ce4b5ba","block_type":"box","text":"purchased. A Fund also may purchase uncovered put options.","page_number":111,"box":{"x":117,"y":785,"width":460,"height":12}},{"id":"069b9705-3a0b-419c-87e8-68b23760c351","block_type":"box","text":"A Fund also may write (","page_number":111,"box":{"x":116,"y":816,"width":176,"height":12}},{"id":"42858876-fddb-421d-959d-0237197b3c09","block_type":"box","text":"i.e.","page_number":111,"box":{"x":293,"y":816,"width":20,"height":9}},{"id":"53cd57ec-e345-4964-a460-5d53463ea030","block_type":"box","text":", sell) put options on the types of securities or instruments that may be held","page_number":111,"box":{"x":316,"y":816,"width":557,"height":12}},{"id":"5b00ca0a-18b7-4cc3-9379-a27a67bb9b1d","block_type":"box","text":"by the Fund. A Fund will receive a premium for writing a put option, which increases the Fund’s return.","page_number":111,"box":{"x":117,"y":831,"width":763,"height":12}},{"id":"a6bd0720-9ad3-408d-b964-63db27d95732","block_type":"box","text":"A Fund also may write (","page_number":111,"box":{"x":116,"y":862,"width":172,"height":12}},{"id":"6271707b-f6d6-44cf-bc3b-52f15d5bd9aa","block_type":"box","text":"i.e.","page_number":111,"box":{"x":289,"y":862,"width":20,"height":10}},{"id":"70d90464-4518-4ddb-9fc8-3c91871b7b0f","block_type":"box","text":", sell) uncovered put options on securities or instruments in which it may invest","page_number":111,"box":{"x":312,"y":862,"width":575,"height":12}},{"id":"328c0dd5-4857-4ee4-b2e4-daff2690133c","block_type":"box","text":"but with respect to which the Fund does not current","page_number":111,"box":{"x":117,"y":878,"width":372,"height":12}},{"id":"9c0668d7-3a02-468c-b8e4-e1662b6bf45e","block_type":"box","text":"ly have a corresponding short position or has not","page_number":111,"box":{"x":490,"y":878,"width":359,"height":12}},{"id":"03f875f1-039b-465b-8be5-0511d3034e0a","block_type":"box","text":"II-27","page_number":111,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"4acf326b-a105-4717-b095-2b821ef0ea98","block_type":"box","text":"NM0926U-5926888-111/257","page_number":111,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"3e752a90-97f2-4681-9c1c-5b633f94a80c","block_type":"box","text":"deposited as collateral cash equal to the exercise va","page_number":112,"box":{"x":116,"y":87,"width":380,"height":12}},{"id":"62ae33d8-189a-4f4d-8ac9-422c1fc5f4e6","block_type":"box","text":"lue of the put option with","page_number":112,"box":{"x":498,"y":87,"width":182,"height":12}},{"id":"9b951889-98cc-4eca-a300-27b047749089","block_type":"box","text":"the broker-dealer through","page_number":112,"box":{"x":680,"y":87,"width":190,"height":12}},{"id":"af432212-41b8-4e78-9303-d8334b136011","block_type":"box","text":"which it made the uncovered put opt","page_number":112,"box":{"x":116,"y":103,"width":264,"height":11}},{"id":"5e163a57-021d-4bc8-9fe6-e7be438a3cfd","block_type":"box","text":"ion. The principal reason for writing uncovered put options is to","page_number":112,"box":{"x":381,"y":102,"width":461,"height":13}},{"id":"dfd4eaaa-b9c7-4324-97c4-56d83c5bd3f7","block_type":"box","text":"receive premium income and to acquire such securities","page_number":112,"box":{"x":117,"y":118,"width":400,"height":12}},{"id":"7d4e53da-ddee-4c10-94d2-23da87fcfadf","block_type":"box","text":"or instruments at a net cost below the current","page_number":112,"box":{"x":517,"y":118,"width":339,"height":10}},{"id":"d493bee6-87be-4605-bfb4-77d010a68023","block_type":"box","text":"market value. A Fund has the obligation to buy the","page_number":112,"box":{"x":117,"y":134,"width":370,"height":12}},{"id":"e1e0441f-eed4-43a4-bd15-1d575e9f080a","block_type":"box","text":"securities or instruments at an agreed upon price if","page_number":112,"box":{"x":488,"y":134,"width":373,"height":12}},{"id":"598fb759-1b1d-4f75-b660-b28d23e3be42","block_type":"box","text":"the price of the securities or instruments decreases bel","page_number":112,"box":{"x":116,"y":149,"width":397,"height":12}},{"id":"947fe1ea-df11-4b14-a1e3-da22a09d2065","block_type":"box","text":"ow the exercise price. If the price of the securities","page_number":112,"box":{"x":515,"y":149,"width":364,"height":12}},{"id":"8ee3e2a3-8551-4eba-b026-b3708becb139","block_type":"box","text":"or instruments increases during the option period,","page_number":112,"box":{"x":116,"y":165,"width":360,"height":12}},{"id":"c7b14856-62ee-4e35-8fc7-5f7a7de97c31","block_type":"box","text":"the option will expire worthless and a Fund will retain","page_number":112,"box":{"x":477,"y":165,"width":393,"height":11}},{"id":"062d0aac-1ba3-4b19-9cea-85e4c3ae0a7f","block_type":"box","text":"the premium and will not have to purchase the securiti","page_number":112,"box":{"x":116,"y":180,"width":392,"height":12}},{"id":"4a1fc226-e427-4191-95fd-edd2aaf2f4b4","block_type":"box","text":"es or instruments at the exercise price.","page_number":112,"box":{"x":510,"y":180,"width":286,"height":12}},{"id":"1f6a6072-a945-4036-a038-32e937da9190","block_type":"box","text":"Options on Government National Mortgage Association (“GNMA”) Certificates.","page_number":112,"box":{"x":117,"y":211,"width":586,"height":12}},{"id":"173e305f-fb3f-4dc9-8be4-c839a70f5e63","block_type":"box","text":"The following","page_number":112,"box":{"x":704,"y":211,"width":103,"height":12}},{"id":"c3104946-c1c9-42e0-87b8-748b7956cc4c","block_type":"box","text":"information relates to the unique characteristics of options on GNMA Certificates. Since the remaining","page_number":112,"box":{"x":117,"y":227,"width":759,"height":12}},{"id":"7f949971-d88e-441a-a1ca-e6452f703c0b","block_type":"box","text":"principal balance of GNMA Certificates declines each month as a result of mortgage payments, a","page_number":112,"box":{"x":117,"y":242,"width":725,"height":12}},{"id":"c8d60459-1863-4d39-b98c-20d9a721240a","block_type":"box","text":"Fund, as a writer of a GNMA call holding GNMA Certificates as “cover” to satisfy its delivery obligation","page_number":112,"box":{"x":117,"y":258,"width":761,"height":12}},{"id":"9df78cd8-67fa-42df-a16f-0f5f201dd3e0","block_type":"box","text":"in the event of exercise, may find that the GNMA Certificates it holds no longer have a sufficient","page_number":112,"box":{"x":117,"y":273,"width":714,"height":12}},{"id":"6103aacb-cd4a-4abc-b00a-1cbe161e6033","block_type":"box","text":"remaining principal balance for this purpose. Should this occur, a Fund will purchase additional GNMA","page_number":112,"box":{"x":117,"y":289,"width":763,"height":12}},{"id":"17ab5337-cb2a-4af5-bb75-e1bcc1c5474c","block_type":"box","text":"Certificates from the same pool (if obtainable) or other GNMA Certificates in the cash market in order","page_number":112,"box":{"x":117,"y":304,"width":754,"height":12}},{"id":"bd99da98-771b-4bb0-ad24-725aec7e3980","block_type":"box","text":"to maintain its “cover.”","page_number":112,"box":{"x":116,"y":320,"width":170,"height":9}},{"id":"1f443dfc-23b7-4357-afb1-ae484bfd569a","block_type":"box","text":"A GNMA Certificate held by a Fund to cover an option position in any but the nearest expiration month","page_number":112,"box":{"x":116,"y":351,"width":764,"height":12}},{"id":"56182bc0-e477-45f9-9762-c2797a36b424","block_type":"box","text":"may cease to represent cover for the option in the event of a decline in the GNMA coupon rate at","page_number":112,"box":{"x":117,"y":366,"width":724,"height":12}},{"id":"3ae219a5-12e7-4ea0-8b5d-7499c39edeb5","block_type":"box","text":"which new pools are originated under the FHA/VA loan ceiling in effect at any given time. If this should","page_number":112,"box":{"x":116,"y":382,"width":765,"height":12}},{"id":"36fbc836-4b96-43df-97e6-f13c5e3b286d","block_type":"box","text":"occur, a Fund will no longer be covered, and the Fund will either enter into a closing purchase","page_number":112,"box":{"x":116,"y":397,"width":701,"height":12}},{"id":"0b6ec8f8-7edc-4f6e-8eb2-91b3c521e380","block_type":"box","text":"transaction or replace such Certificate with a certificate that represents cover. When a Fund closes its","page_number":112,"box":{"x":116,"y":413,"width":760,"height":12}},{"id":"869f2d8b-8bf0-4949-9a1b-6caeb4993e47","block_type":"box","text":"position or replaces such Certificate, it may realize an unanticipated loss and incur transaction costs.","page_number":112,"box":{"x":117,"y":428,"width":751,"height":12}},{"id":"46d27189-15fe-4636-aa82-b3fda6da1992","block_type":"box","text":"Options on Swaps (“Swaptions”).","page_number":112,"box":{"x":117,"y":459,"width":243,"height":12}},{"id":"dc097116-c968-46a6-8c92-544f066a7930","block_type":"box","text":"A swaption gives a counterparty the option (but not the obligation) to","page_number":112,"box":{"x":362,"y":459,"width":517,"height":12}},{"id":"3c0029d2-3adb-4f44-a288-44ca69f78958","block_type":"box","text":"enter into a new swap agreement or to shorten, extend, cancel or otherwise modify an existing swap","page_number":112,"box":{"x":116,"y":475,"width":750,"height":12}},{"id":"09ad5f5a-b6f9-482b-8d17-58127f4830df","block_type":"box","text":"agreement, at a designated future time on specified terms. A Fund may write (","page_number":112,"box":{"x":116,"y":490,"width":580,"height":12}},{"id":"97d141f0-ed49-4be7-9e34-7aca3596efdb","block_type":"box","text":"i.e.","page_number":112,"box":{"x":698,"y":490,"width":20,"height":10}},{"id":"a0b8de49-eb23-464c-ab42-ba408ce8d9ed","block_type":"box","text":", sell) and purchase","page_number":112,"box":{"x":721,"y":490,"width":150,"height":12}},{"id":"08f1444f-dbef-49ad-b866-6463739afe4f","block_type":"box","text":"put and call swaptions. Depending on the terms of the particular option agreement, a Fund will","page_number":112,"box":{"x":117,"y":506,"width":704,"height":12}},{"id":"47eccc9f-2a6d-4f20-8a9c-b68024d4c183","block_type":"box","text":"generally incur a greater degree of risk when it writes a swaption than it will incur when it purchases a","page_number":112,"box":{"x":116,"y":521,"width":758,"height":12}},{"id":"bf1812e8-24a3-47a8-884c-c9825630ac68","block_type":"box","text":"swaption. When a Fund purchases a swaption, it risks losing only the amount of the premium it has","page_number":112,"box":{"x":116,"y":537,"width":741,"height":12}},{"id":"97dad79c-e66b-452e-9283-956f91f701f2","block_type":"box","text":"paid should it decide to let the option expire unexercised. However, when a Fund writes a swaption,","page_number":112,"box":{"x":117,"y":552,"width":743,"height":12}},{"id":"80957e43-3e0b-449f-b57f-33b20f6ad71c","block_type":"box","text":"upon exercise of the option the Fund will become obligated according to the terms of the underlying","page_number":112,"box":{"x":117,"y":568,"width":743,"height":12}},{"id":"01df2a6e-3c53-4d6d-9287-0a485f98e7cc","block_type":"box","text":"agreement and the potential for loss may be unlimited. Certain swaptions are permitted, although not","page_number":112,"box":{"x":116,"y":583,"width":754,"height":12}},{"id":"320d0a36-8049-4d96-8703-897329ddb3b7","block_type":"box","text":"required, to be cleared.","page_number":112,"box":{"x":117,"y":599,"width":177,"height":12}},{"id":"454c4250-42fb-4e8c-ac69-274427024aee","block_type":"box","text":"A Fund will likely enter into these transactions to preserve a return or spread on a particular investment","page_number":112,"box":{"x":116,"y":630,"width":770,"height":12}},{"id":"6658b041-6f2a-4e69-bd75-6dee29e13558","block_type":"box","text":"or portion of its portfolio or to protect against any increase in the price of securities the Fund anticipates","page_number":112,"box":{"x":116,"y":645,"width":772,"height":12}},{"id":"c2a04a91-a724-467f-8f2f-7575353a0662","block_type":"box","text":"purchasing at a later date. A Fund generally will use these transactions for hedging purposes, not for","page_number":112,"box":{"x":117,"y":661,"width":746,"height":12}},{"id":"b4c2f8ed-fd9e-44ae-96e9-d13da3bf8d0b","block_type":"box","text":"speculation.","page_number":112,"box":{"x":116,"y":676,"width":88,"height":12}},{"id":"8ffafd6e-416c-479b-9627-381f7834bf69","block_type":"box","text":"Swaptions may be subject to correlation risk, leverage risk, illiquidity risk and market risk. See “— Risk","page_number":112,"box":{"x":116,"y":707,"width":760,"height":12}},{"id":"1ffd917c-c2ec-46f1-bc0a-7991cc354101","block_type":"box","text":"Factors in Derivatives” above.","page_number":112,"box":{"x":117,"y":723,"width":220,"height":9}},{"id":"99c6efad-8056-4f5b-bae3-9a8ae63a5341","block_type":"box","text":"FLEX Options.","page_number":112,"box":{"x":116,"y":754,"width":107,"height":12}},{"id":"00ceb2a2-dba1-493d-8401-eac0d7a86ef2","block_type":"box","text":"FLEX Options are customized option contracts available through national securities","page_number":112,"box":{"x":231,"y":754,"width":617,"height":12}},{"id":"9f6e9db0-2797-49d2-9bf0-d0128f1383b4","block_type":"box","text":"exchanges that are guaranteed for settlement by the Options Clearing Corporation (“OCC”). FLEX","page_number":112,"box":{"x":116,"y":769,"width":729,"height":12}},{"id":"bd5f3c9f-7fca-4388-bce7-24a401607011","block_type":"box","text":"Options are listed on a U.S. national securities exchange. FLEX Options provide investors with the","page_number":112,"box":{"x":116,"y":785,"width":731,"height":12}},{"id":"8cb16e2d-6523-4bee-8ca8-aeb1b631599b","block_type":"box","text":"ability to customize assets referenced by the options, exercise prices, exercise styles (","page_number":112,"box":{"x":116,"y":800,"width":641,"height":12}},{"id":"86d0ee75-39ce-454d-bc3b-33c930d749e7","block_type":"box","text":"i.e.","page_number":112,"box":{"x":758,"y":800,"width":20,"height":10}},{"id":"f74a5d4f-d623-4084-b077-b740a406d7ed","block_type":"box","text":", American","page_number":112,"box":{"x":782,"y":800,"width":84,"height":11}},{"id":"3f447ed9-67b5-4ac5-becc-8d9c01c60b1b","block_type":"box","text":"style, exercisable any time prior to the expiration date, or European-style, exercisable only on the","page_number":112,"box":{"x":116,"y":816,"width":721,"height":12}},{"id":"0897c883-a253-49f6-a328-bc3833b1c78b","block_type":"box","text":"option expiration date) and expiration dates, while achieving price discovery in competitive, transparent","page_number":112,"box":{"x":116,"y":831,"width":769,"height":12}},{"id":"fcef2b79-2753-4403-b69d-6fd924004e7b","block_type":"box","text":"auctions markets and avoiding the counterparty exposure of OTC options positions. Each option","page_number":112,"box":{"x":116,"y":847,"width":719,"height":12}},{"id":"a0abbaa8-6bca-4a6b-b094-be0ecc4faae4","block_type":"box","text":"contract entitles the holder thereof to purchase (for the","page_number":112,"box":{"x":116,"y":862,"width":410,"height":12}},{"id":"182afb0e-e7c5-42c6-ae4d-5fe44043b8a7","block_type":"box","text":"call options) or sell (for the put options) shares","page_number":112,"box":{"x":527,"y":862,"width":349,"height":12}},{"id":"71a62596-64ef-47bb-aff2-472da5debd49","block_type":"box","text":"of the reference asset at the strike price. A Fund’s portfolio may include several types of FLEX Options,","page_number":112,"box":{"x":116,"y":878,"width":772,"height":12}},{"id":"5e3cbe5f-e859-4eb8-81cd-ff88c2321a11","block_type":"box","text":"II-28","page_number":112,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"fb9d1193-6fcf-4869-837e-a095f403f4f9","block_type":"box","text":"NM0926U-5926888-112/257","page_number":112,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"808d3f0f-306d-495e-ac45-fff617abb86c","block_type":"box","text":"including both purchased and written put and call options (as further described below). The FLEX","page_number":113,"box":{"x":117,"y":87,"width":726,"height":12}},{"id":"b8fb4cdd-6406-46d5-9db9-3dfca653ff09","block_type":"box","text":"Options are all European style options, which means that they are exercisable at a predetermined","page_number":113,"box":{"x":116,"y":102,"width":730,"height":13}},{"id":"1e0ac5d2-cf77-4040-8548-cc62cd52a35b","block_type":"box","text":"specified price (the “strike price”) only on the FLEX Option’s expiration date.","page_number":113,"box":{"x":116,"y":118,"width":569,"height":12}},{"id":"729656b7-3cf8-4314-934d-59b06be95a83","block_type":"box","text":"The OCC guarantees performance by each of the counterparties to the FLEX Options, becoming the","page_number":113,"box":{"x":116,"y":149,"width":752,"height":12}},{"id":"8e4abdc3-6863-4914-a369-e47aa908310e","block_type":"box","text":"“buyer for every seller and the seller for every buyer”, reducing counterparty risk for clearing members","page_number":113,"box":{"x":116,"y":165,"width":762,"height":12}},{"id":"25fadab7-6296-402e-b152-ff34465bd7b9","block_type":"box","text":"and options traders. Although guaranteed for settlement by the OCC, FLEX Options are still subject to","page_number":113,"box":{"x":116,"y":180,"width":762,"height":12}},{"id":"e529f581-8c1f-4c7f-bc34-59acced5175a","block_type":"box","text":"counterparty risk with the OCC and subject to the risk that the OCC may fail to perform the settlement","page_number":113,"box":{"x":116,"y":196,"width":760,"height":12}},{"id":"4d024068-1dc4-4293-908b-de82650423b2","block_type":"box","text":"of the FLEX Options due to bankruptcy or other adverse reasons. A Fund bears the risk that the OCC","page_number":113,"box":{"x":116,"y":211,"width":759,"height":12}},{"id":"ffccc5ee-a84e-44e2-98e7-1d3d763f4c9b","block_type":"box","text":"will be unable or unwilling to perform its obligations under the FLEX Options contracts.","page_number":113,"box":{"x":116,"y":227,"width":646,"height":12}},{"id":"4d78e5b8-3e06-4112-83b5-a07214fcbd67","block_type":"box","text":"Subject to determination by the Securities Committee of the OCC, adjustments may be made to the","page_number":113,"box":{"x":116,"y":258,"width":744,"height":12}},{"id":"e80d4ce5-85b4-4b73-a1c6-f507fedd3f31","block_type":"box","text":"FLEX Options for certain events (collectively, “Corporate Actions”) specified in the OCC’s by-laws and","page_number":113,"box":{"x":117,"y":273,"width":760,"height":12}},{"id":"b484b35b-b9c8-478b-a0e7-1c35e4f93739","block_type":"box","text":"rules: certain stock dividends or distributions, stock splits, reverse stock splits, rights offerings,","page_number":113,"box":{"x":117,"y":289,"width":702,"height":12}},{"id":"6700b3cd-66c1-4fc5-a54f-74cea2af4dc6","block_type":"box","text":"distributions, reorganizations, recapitalizations, or reclassifications with respect to an underlying","page_number":113,"box":{"x":116,"y":304,"width":715,"height":12}},{"id":"7467af4d-1041-4331-9199-f5fd8f332682","block_type":"box","text":"security, or a merger, consolidation, dissolution or liquidation of the issuer of the underlying security.","page_number":113,"box":{"x":116,"y":320,"width":748,"height":12}},{"id":"e533a68b-90c5-4fc3-aeff-cee6286e7b7f","block_type":"box","text":"According to the OCC’s by-laws, the nature and extent of any such adjustment is to be determined by","page_number":113,"box":{"x":116,"y":335,"width":759,"height":12}},{"id":"eff71335-3477-4938-a538-8460df472476","block_type":"box","text":"the OCC’s Securities Committee, in light of the circumstances known to it at the time such","page_number":113,"box":{"x":116,"y":351,"width":673,"height":12}},{"id":"59d91d5d-0a95-45c5-9c5f-7970071b8aca","block_type":"box","text":"determination is made, based on its judgment as to what is appropriate for the protection of investors","page_number":113,"box":{"x":116,"y":366,"width":754,"height":12}},{"id":"73ca77ac-de31-4c14-811d-c0f7e7d36bbe","block_type":"box","text":"and the public interest, taking into account such factors as fairness to holders and writers (or","page_number":113,"box":{"x":116,"y":382,"width":691,"height":12}},{"id":"dd121165-1fc7-4803-96f8-1e53e63bfe90","block_type":"box","text":"purchasers and sellers) of the affected options, the maintenance of a fair and orderly market in the","page_number":113,"box":{"x":117,"y":397,"width":734,"height":12}},{"id":"f9e66496-c6a5-4f26-b115-7c7ef823f8b2","block_type":"box","text":"affected options, consistency of interpretation and practice, efficiency of exercise settlement","page_number":113,"box":{"x":116,"y":413,"width":687,"height":12}},{"id":"54201b47-8684-4787-a696-b2b56d681713","block_type":"box","text":"procedures, and the coordination with other clearing agencies of the clearance and settlement of","page_number":113,"box":{"x":117,"y":428,"width":721,"height":12}},{"id":"af76f2ee-8b69-4a23-85e2-36bf2a061091","block_type":"box","text":"transactions in the underlying interest.","page_number":113,"box":{"x":116,"y":444,"width":288,"height":12}},{"id":"2ed5f772-00f9-4875-98cd-4437798aadb9","block_type":"box","text":"Certain Considerations Regarding Options","page_number":113,"box":{"x":151,"y":475,"width":314,"height":12}},{"id":"cfe0691e-a427-4f8d-ae63-f2d554261a6c","block_type":"box","text":". The FLEX Options in which each Fund may invest will","page_number":113,"box":{"x":467,"y":475,"width":414,"height":12}},{"id":"149db4a1-79c4-49da-bf86-a7159aa28177","block_type":"box","text":"be options on an exchange-traded fund (“ETF”) or the S&P 500 Index (together with such ETF, a","page_number":113,"box":{"x":150,"y":490,"width":723,"height":12}},{"id":"ea73a8ce-c960-448a-bb64-01ebcec1adef","block_type":"box","text":"“Reference Asset”). As such, the value of a Fund’s FLEX Options will fluctuate with changes in the","page_number":113,"box":{"x":150,"y":506,"width":735,"height":12}},{"id":"33244972-14e2-4979-adac-32912db949c9","block_type":"box","text":"value of the securities held by the ETF, and thus the ETF’s share price. In addition to the value of","page_number":113,"box":{"x":150,"y":521,"width":726,"height":12}},{"id":"a8e39bab-ec3e-482d-bfc9-28c98241c0d1","block_type":"box","text":"the ETF, the value of an option, in general, will reflect, among other things, the time remaining until","page_number":113,"box":{"x":150,"y":537,"width":738,"height":12}},{"id":"a464e36b-38b8-41f3-be19-62e4d4bf2ca2","block_type":"box","text":"expiration (the end of the Outcome Period), the relationship of the exercise price to the market","page_number":113,"box":{"x":150,"y":552,"width":704,"height":12}},{"id":"caf364bb-5f67-4762-abe4-73d22e97e60c","block_type":"box","text":"price of the Reference Asset, and general market conditions. Options that expire unexercised","page_number":113,"box":{"x":150,"y":568,"width":698,"height":12}},{"id":"22be0bef-2ed2-4b82-a4d7-4af007fce0b9","block_type":"box","text":"have no value.","page_number":113,"box":{"x":150,"y":583,"width":113,"height":10}},{"id":"281404e5-1846-445c-ac90-c73269deb813","block_type":"box","text":"The puts and calls on the Reference Asset entitle the purchaser of the option the right to purchase","page_number":113,"box":{"x":150,"y":606,"width":734,"height":12}},{"id":"166049f0-0eb0-4bf9-b072-60d0ca8a2047","block_type":"box","text":"(for a call option) or sell (for a put option) the Reference Asset at a predetermined specified price","page_number":113,"box":{"x":150,"y":622,"width":723,"height":12}},{"id":"ae715c8b-7395-44a3-ac79-e6d3cf596c79","block_type":"box","text":"(the “strike price”). When a Fund writes a call on the Reference Asset, it receives a premium and","page_number":113,"box":{"x":150,"y":637,"width":722,"height":12}},{"id":"d531c282-226c-4e7b-a440-9a098039cec9","block_type":"box","text":"agrees that the purchaser of the call, upon exercise of the call, will receive from the Fund the","page_number":113,"box":{"x":150,"y":653,"width":693,"height":12}},{"id":"4f2f375e-92b1-4767-9034-4a3d4097c816","block_type":"box","text":"delivery of a specified number of shares of the ETF in exchange for the strike price. When a Fund","page_number":113,"box":{"x":150,"y":668,"width":724,"height":12}},{"id":"f1de6c52-4a33-4521-9db8-1277079a005d","block_type":"box","text":"buys a call on the Reference Asset, it pays a premium and has the same rights to such call as","page_number":113,"box":{"x":150,"y":684,"width":697,"height":12}},{"id":"a701b0f8-9d5f-4b1c-9944-87bd2daedd4d","block_type":"box","text":"indicated above. When a Fund buys a put on the Reference Asset, it pays a premium and has the","page_number":113,"box":{"x":150,"y":699,"width":725,"height":13}},{"id":"c6b0dcca-0c02-4ca9-a9a3-f46be08926e4","block_type":"box","text":"right to require the seller of the put, upon the Fund’s exercise of the put, to deliver the specified","page_number":113,"box":{"x":150,"y":715,"width":704,"height":12}},{"id":"a0549603-8b69-46b4-8cc3-0612f88191bb","block_type":"box","text":"number of shares of the ETF in exchange for the strike price. When a Fund writes a put on the","page_number":113,"box":{"x":150,"y":730,"width":700,"height":13}},{"id":"559c88a3-d675-4888-bd82-68cd6905420f","block_type":"box","text":"Reference Asset, it receives a premium and the purchaser of the put has the right to require the","page_number":113,"box":{"x":151,"y":746,"width":708,"height":12}},{"id":"06cef120-b340-4c47-aca4-9dd98d65087f","block_type":"box","text":"Fund to deliver the specified number of shares of the ETF in exchange for the strike price.","page_number":113,"box":{"x":151,"y":761,"width":665,"height":13}},{"id":"5ccf9f83-6f1f-4b8d-87fd-5429dc1ea188","block_type":"box","text":"Although each Fund will generally utilize FLEX Options that are physically settled, a Fund may","page_number":113,"box":{"x":149,"y":785,"width":701,"height":12}},{"id":"c40efe3f-c680-4482-b181-fc132d4b6a12","block_type":"box","text":"also utilize FLEX Options that are cash-settled. Cash-settled options give the holder the right to","page_number":113,"box":{"x":150,"y":800,"width":706,"height":12}},{"id":"cc478e7c-c3d6-4c71-8d69-2eb3aa495e4d","block_type":"box","text":"receive an amount (or owe an amount) of cash upon the exercise of the option. Gain or loss","page_number":113,"box":{"x":150,"y":816,"width":681,"height":12}},{"id":"7794e408-b45c-40f3-87ff-f57a430ad27d","block_type":"box","text":"depends on changes in the value of the ETF’s share price relative to the strike price for a given","page_number":113,"box":{"x":150,"y":831,"width":710,"height":12}},{"id":"97170285-bdf9-4c45-864b-86a3e4d04068","block_type":"box","text":"option contract. The amount of cash is equal to the difference between the closing price of the","page_number":113,"box":{"x":150,"y":847,"width":702,"height":12}},{"id":"cea6419a-bf27-4c28-a0a7-bf13ae2a72ce","block_type":"box","text":"ETF’s share price and the exercise price of the option contract times a specified multiple","page_number":113,"box":{"x":151,"y":862,"width":659,"height":12}},{"id":"5ce68164-56a4-4d42-8b58-b377058ad720","block_type":"box","text":"(“multiplier”), which determines the total value for each point of such difference.","page_number":113,"box":{"x":150,"y":878,"width":593,"height":12}},{"id":"2f535d36-6fe8-41d4-8614-ac7bd1f80fca","block_type":"box","text":"II-29","page_number":113,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"b36e8209-f7e2-4e75-b7a7-24df982d7518","block_type":"box","text":"NM0926U-5926888-113/257","page_number":113,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"75cb6708-0c05-440c-b06e-1637779e7712","block_type":"box","text":"Risks of Options on the Reference Assets","page_number":114,"box":{"x":150,"y":87,"width":311,"height":12}},{"id":"c65a8b13-2038-4e3b-ae38-1960e15405c9","block_type":"box","text":". If a Fund has purchased an option and exercises it","page_number":114,"box":{"x":462,"y":87,"width":390,"height":12}},{"id":"5116cecd-bc61-4926-a421-a886859e71a3","block_type":"box","text":"before the closing value for that day is available, it runs the risk that the level of the Reference","page_number":114,"box":{"x":150,"y":102,"width":702,"height":13}},{"id":"facec4ac-ed32-4c47-bc8f-2c9f69174355","block_type":"box","text":"Asset may subsequently change. If such a change causes the exercised option to fall out of the","page_number":114,"box":{"x":149,"y":118,"width":714,"height":12}},{"id":"a9e7b4ee-24f1-411a-8755-1175e64f6933","block_type":"box","text":"money, the applicable Fund will be required to pay the difference between the closing Reference","page_number":114,"box":{"x":150,"y":134,"width":721,"height":12}},{"id":"117027df-bb85-483c-a80e-59dd558caabc","block_type":"box","text":"Asset value and the exercise price of the option (times the applicable multiplier) to the assigned","page_number":114,"box":{"x":149,"y":149,"width":714,"height":12}},{"id":"db893591-16c0-4597-8242-c7ba8b2a5006","block_type":"box","text":"writer.","page_number":114,"box":{"x":149,"y":165,"width":51,"height":9}},{"id":"eafc2bbe-71d0-4c15-9849-26f79a29e4d9","block_type":"box","text":"Foreign Exchange Transactions.","page_number":114,"box":{"x":116,"y":196,"width":247,"height":12}},{"id":"3573bf08-b7cf-4590-91f7-ae469a57ab32","block_type":"box","text":"A Fund may enter into spot foreign exchange transactions, forward foreign exchange transactions (“FX","page_number":114,"box":{"x":116,"y":219,"width":768,"height":12}},{"id":"21e0727c-3220-4466-b70d-dc86726bc302","block_type":"box","text":"forwards”) and currency swaps, purchase and sell currency options, currency futures and related","page_number":114,"box":{"x":116,"y":234,"width":723,"height":12}},{"id":"2a768bd0-71dc-4300-972b-82591ee751e9","block_type":"box","text":"options thereon (collectively, “Currency Instruments”) for purposes of hedging against the decline in the","page_number":114,"box":{"x":116,"y":250,"width":772,"height":12}},{"id":"b85887cf-dcf6-4376-bc90-1f9c3e91a8df","block_type":"box","text":"value of currencies in which its portfolio holdings are denominated against the U.S. dollar or, with","page_number":114,"box":{"x":116,"y":265,"width":725,"height":12}},{"id":"1d67b2fe-7c18-486b-8804-111bcb2a7076","block_type":"box","text":"respect to certain Funds, to seek to enhance returns.","page_number":114,"box":{"x":117,"y":281,"width":397,"height":12}},{"id":"dc8d2d13-4ece-4c32-bf4e-877090216a46","block_type":"box","text":"Such transactions could be effected to hedge with respect to foreign dollar denominated securities","page_number":114,"box":{"x":116,"y":312,"width":734,"height":12}},{"id":"f8bd8420-1164-48a4-946b-b109ccf63c17","block_type":"box","text":"owned by a Fund, sold by a Fund but not","page_number":114,"box":{"x":116,"y":327,"width":309,"height":12}},{"id":"0aaaec3f-1c81-4858-ae61-5c9f33b8d672","block_type":"box","text":"yet delivered, or committed or anticipated to be purchased by","page_number":114,"box":{"x":426,"y":327,"width":460,"height":12}},{"id":"511565e6-384b-480d-b4c2-fdb6c4beab73","block_type":"box","text":"a Fund. As an illustration, a Fund may use such techniques to hedge the stated value in U.S. dollars of","page_number":114,"box":{"x":116,"y":343,"width":768,"height":12}},{"id":"0a661cac-1715-4055-8322-eab979b9f46f","block_type":"box","text":"an investment in a yen-denominated security. For example, the Fund may purchase a foreign currency","page_number":114,"box":{"x":116,"y":358,"width":767,"height":12}},{"id":"45ebb63f-504d-4b3b-aeae-136a03a061a7","block_type":"box","text":"put option enabling it to sell a specified amount of yen","page_number":114,"box":{"x":117,"y":374,"width":404,"height":12}},{"id":"fae91733-c0d5-408c-8209-e41a71b14595","block_type":"box","text":"for dollars at a specified price by a future date.","page_number":114,"box":{"x":521,"y":374,"width":350,"height":12}},{"id":"ae572def-acd6-4bb6-a552-1aa2dfb91b43","block_type":"box","text":"To the extent the hedge is successful, a loss in the value of the yen relative to the dollar will tend to be","page_number":114,"box":{"x":116,"y":389,"width":764,"height":12}},{"id":"1cdde5a7-bca1-451e-a9dc-6c1465953fa5","block_type":"box","text":"offset by an increase in the value of the put option. To offset, in whole or in part, the cost of acquiring","page_number":114,"box":{"x":116,"y":405,"width":753,"height":12}},{"id":"7b9b629b-4e7e-4072-89a4-95fb5d52f408","block_type":"box","text":"such a put option, the Fund may also sell a call option which, if exercised, requires it to sell a specified","page_number":114,"box":{"x":116,"y":420,"width":764,"height":12}},{"id":"30ed62e0-6f4e-421d-aa21-20ed016d0854","block_type":"box","text":"amount of yen for dollars at a specified price by a future date (a technique called a “straddle”). By","page_number":114,"box":{"x":116,"y":436,"width":727,"height":12}},{"id":"a7f5806d-7609-4d37-9947-ae90f095c5a2","block_type":"box","text":"selling such a call option in this illustration, the Fund gives up the opportunity to profit without limit from","page_number":114,"box":{"x":116,"y":451,"width":767,"height":12}},{"id":"3165bfda-ea78-4f8c-8305-57bfd35d1804","block_type":"box","text":"increases in the relative value of the yen to the dollar. “Straddles” of the type that may be used by a","page_number":114,"box":{"x":117,"y":467,"width":742,"height":12}},{"id":"81a136d5-95cd-42c1-9cfa-d34fc72a0968","block_type":"box","text":"Fund are considered hedging transactions. Certain Funds have a fundamental investment restriction","page_number":114,"box":{"x":117,"y":482,"width":749,"height":12}},{"id":"590ad866-cc36-479d-b1e3-84f83b4f92c0","block_type":"box","text":"that restricts currency option strategies.","page_number":114,"box":{"x":116,"y":498,"width":298,"height":12}},{"id":"e2d286e6-1079-403f-89a0-2d4490d72553","block_type":"box","text":"Hedging transactions involving Currency Instruments involve substantial risks, including correlation","page_number":114,"box":{"x":117,"y":529,"width":737,"height":12}},{"id":"16abd6d5-a2f6-4c45-a1c8-b27496f3b9d8","block_type":"box","text":"risk. A Fund’s use of Currency Instruments to effect hedging strategies is intended to reduce the","page_number":114,"box":{"x":117,"y":544,"width":718,"height":12}},{"id":"91869cee-c2af-47fd-bb25-e27b6a302093","block_type":"box","text":"volatility of the NAV of the Fund’s shares; however, the use of such hedging strategies will not prevent","page_number":114,"box":{"x":116,"y":560,"width":763,"height":12}},{"id":"857eb138-3f48-4029-bb87-cf3e598dea50","block_type":"box","text":"the NAV of the Fund’s shares from fluctuating. Moreover, although Currency Instruments will be used","page_number":114,"box":{"x":116,"y":575,"width":757,"height":12}},{"id":"73eda61d-1a4d-4496-9465-4be39cec2f63","block_type":"box","text":"with the intention of hedging against adverse currency movements, transactions in Currency","page_number":114,"box":{"x":116,"y":591,"width":689,"height":12}},{"id":"2af950f2-5b13-4fb0-a3d8-374b9c243dd8","block_type":"box","text":"Instruments involve the risk that anticipated currency movements will not be accurately predicted and","page_number":114,"box":{"x":117,"y":607,"width":755,"height":11}},{"id":"40baf0c6-f095-4337-9824-a53f9a1560a8","block_type":"box","text":"that the Fund’s hedging strategies will be ineffective. To the extent that a Fund hedges against","page_number":114,"box":{"x":116,"y":622,"width":706,"height":12}},{"id":"03367307-b356-4c00-81b9-ebdc351f5256","block_type":"box","text":"anticipated currency movements that do not occur, the Fund may realize losses and decrease its total","page_number":114,"box":{"x":116,"y":638,"width":761,"height":11}},{"id":"175813cf-2484-47a3-9f8f-0dc72c4d030d","block_type":"box","text":"return. Furthermore, a Fund will only engage in hedging activities from time to time and may not be","page_number":114,"box":{"x":117,"y":653,"width":738,"height":12}},{"id":"b834ad0e-9f73-4892-87a1-be8764b3531c","block_type":"box","text":"engaging in hedging activities when movements in currency exchange rates actually occur.","page_number":114,"box":{"x":116,"y":669,"width":674,"height":11}},{"id":"a5f9c356-1659-4ae1-8e5b-e50345ec3b2f","block_type":"box","text":"In connection with its trading in forward foreign currency contracts, a Fund will contract with a foreign","page_number":114,"box":{"x":117,"y":699,"width":746,"height":13}},{"id":"8792f07d-7767-4c3b-be5c-d57f5799a99c","block_type":"box","text":"or domestic bank, or foreign or domestic securities dealer, to make or take future delivery of a specified","page_number":114,"box":{"x":116,"y":715,"width":766,"height":12}},{"id":"b99a5f72-47e3-487c-a4b5-b7f9f59b1059","block_type":"box","text":"amount of a particular currency. There are no limitations on daily price moves in such forward","page_number":114,"box":{"x":116,"y":730,"width":693,"height":13}},{"id":"f770fe74-ccfd-40ac-9dab-bb7436dee010","block_type":"box","text":"contracts, and banks and dealers are not required to continue to make markets in such contracts.","page_number":114,"box":{"x":116,"y":746,"width":722,"height":12}},{"id":"c28ec634-4483-4e22-b868-6af6b095fab6","block_type":"box","text":"There have been periods during which certain banks or dealers have refused to quote prices for such","page_number":114,"box":{"x":116,"y":761,"width":751,"height":13}},{"id":"e56f8b85-ae48-464e-8a36-ce9e303871f3","block_type":"box","text":"forward contracts or have quoted prices with an unusually wide spread between the price at which the","page_number":114,"box":{"x":116,"y":777,"width":756,"height":12}},{"id":"4eca3dba-0fe9-4ea8-9dd7-8f5a36ca8824","block_type":"box","text":"bank or dealer is prepared to buy and that at which it is prepared to sell. Governmental imposition of","page_number":114,"box":{"x":117,"y":792,"width":743,"height":13}},{"id":"57b3dd6a-ddae-445d-b235-4acb4293902c","block_type":"box","text":"currency controls might limit any such forward contract trading. With respect to its trading of forward","page_number":114,"box":{"x":116,"y":808,"width":740,"height":12}},{"id":"738bc380-f41f-4fd4-b955-9ad9dff1eb48","block_type":"box","text":"contracts, if any, a Fund will be subject to counterparty risk. Any such failure to perform by a","page_number":114,"box":{"x":116,"y":823,"width":683,"height":13}},{"id":"04f20348-cf93-47c8-a1be-2a906a3ae1fd","block_type":"box","text":"counterparty would deprive the Fund of any profit potential or force the Fund to cover its commitments","page_number":114,"box":{"x":116,"y":839,"width":762,"height":12}},{"id":"b6c3c523-25f1-4eff-a673-08d5813fc961","block_type":"box","text":"for resale, if any, at the then market price and could result in a loss to the Fund.","page_number":114,"box":{"x":116,"y":854,"width":595,"height":13}},{"id":"df0374de-ba2d-4948-9454-349c0f5abb45","block_type":"box","text":"II-30","page_number":114,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"100c6108-e512-402c-993b-8927b3a89a97","block_type":"box","text":"NM0926U-5926888-114/257","page_number":114,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"2fa0610d-e09b-4595-8bb0-81b3908bfcd2","block_type":"box","text":"It may not be possible for a Fund to hedge against currency exchange rate movements, even if","page_number":115,"box":{"x":117,"y":87,"width":709,"height":12}},{"id":"9dba243d-653e-4cd3-a5ef-4732cefd74b0","block_type":"box","text":"correctly anticipated, in the event that (i) the currency exchange rate movement is so generally","page_number":115,"box":{"x":116,"y":102,"width":707,"height":13}},{"id":"f5ce6920-6173-4e60-9916-afd3e111dab5","block_type":"box","text":"anticipated that the Fund is not able to enter into a hedging transaction at an effective price, or (ii) the","page_number":115,"box":{"x":116,"y":118,"width":757,"height":12}},{"id":"d0e47074-a6ec-41b0-bab4-9ab9c3b62ac3","block_type":"box","text":"currency exchange rate movement relates to a market with respect to which Currency Instruments are","page_number":115,"box":{"x":116,"y":134,"width":764,"height":12}},{"id":"86d98eb2-d00b-44da-8aa7-aeded8071ea3","block_type":"box","text":"not available and it is not possible to engage in effective foreign currency hedging. The cost to a Fund","page_number":115,"box":{"x":117,"y":149,"width":759,"height":12}},{"id":"62e31882-6afc-4124-b0c3-6c2706459c38","block_type":"box","text":"of engaging in foreign currency transactions varies with such factors as the currencies involved, the","page_number":115,"box":{"x":116,"y":165,"width":743,"height":12}},{"id":"df301816-e384-455f-abc9-8bcdd516cb46","block_type":"box","text":"length of the contract period and the market conditions then prevailing. Since transactions in foreign","page_number":115,"box":{"x":117,"y":180,"width":744,"height":12}},{"id":"e5a0b281-2781-48ea-b877-c89c07a2f5ed","block_type":"box","text":"currency exchange usually are conducted on a principal basis, no fees or commissions are involved.","page_number":115,"box":{"x":116,"y":196,"width":750,"height":12}},{"id":"ad47a8a3-3230-4ef3-ae03-cbd2428321c6","block_type":"box","text":"A Fund will not hedge a currency in excess of the aggregate market value of the securities that it owns","page_number":115,"box":{"x":116,"y":227,"width":765,"height":12}},{"id":"619b214b-02f9-4c23-8c87-e8d37f8a8461","block_type":"box","text":"(including receivables for unsettled securities sales), or has committed to purchase or anticipates","page_number":115,"box":{"x":117,"y":242,"width":724,"height":12}},{"id":"84c66b7a-5d7c-488a-8164-2ffe1675a5da","block_type":"box","text":"purchasing, which are denominated in such currency.","page_number":115,"box":{"x":117,"y":258,"width":401,"height":12}},{"id":"e19328de-a5a3-4a72-96ec-c15362ba5a9e","block_type":"box","text":"Spot Transactions and FX Forwards.","page_number":115,"box":{"x":117,"y":289,"width":271,"height":12}},{"id":"ac9ebe21-b2c8-4b10-9ffa-df5456bf1f8e","block_type":"box","text":"FX forwards are OTC contracts to purchase or sell a specified","page_number":115,"box":{"x":390,"y":289,"width":470,"height":12}},{"id":"b6a19e9d-11c4-409f-8aa7-c9a0601c60ae","block_type":"box","text":"amount of a specified currency or multinational currency unit at a specified price and specified future","page_number":115,"box":{"x":116,"y":304,"width":750,"height":12}},{"id":"b79d2d18-c742-4fe3-95d6-ec8befa114ac","block_type":"box","text":"date. Spot foreign exchange transactions are similar but are settled in the current, or “spot”, market. A","page_number":115,"box":{"x":116,"y":320,"width":761,"height":12}},{"id":"6ee6decb-bbeb-4f6f-a9a6-2e013f1ed466","block_type":"box","text":"Fund will enter into foreign exchange transactions for purposes of hedging either a specific transaction","page_number":115,"box":{"x":117,"y":335,"width":764,"height":12}},{"id":"09255a93-e33e-43e1-ab6e-67a2ed2560fd","block_type":"box","text":"or a portfolio position, or, with respect to certain Funds, to seek to enhance returns. FX forwards","page_number":115,"box":{"x":116,"y":351,"width":719,"height":12}},{"id":"58a9319b-b130-4dea-b402-9a9566b81717","block_type":"box","text":"involve substantial currency risk, credit risk and liquidity risk. A Fund may enter into a foreign exchange","page_number":115,"box":{"x":117,"y":366,"width":770,"height":12}},{"id":"2593e3ae-c574-49d7-b3a4-40c0aac87962","block_type":"box","text":"transaction for purposes of hedging a specific transaction by, for example, purchasing a currency","page_number":115,"box":{"x":116,"y":382,"width":725,"height":12}},{"id":"654bf82a-21eb-4708-85af-c328d542e575","block_type":"box","text":"needed to settle a security transaction or selling a currency in which the Fund has received or","page_number":115,"box":{"x":117,"y":397,"width":699,"height":12}},{"id":"2bf76d25-c7c2-4493-8ad8-913080606d11","block_type":"box","text":"anticipates receiving a dividend or distribution. A Fund may enter into a foreign exchange transaction","page_number":115,"box":{"x":116,"y":413,"width":754,"height":12}},{"id":"7310feb4-4210-435b-a229-30ab127a73a4","block_type":"box","text":"for purposes of hedging a portfolio position by selling forward a currency in which a portfolio position of","page_number":115,"box":{"x":116,"y":428,"width":767,"height":12}},{"id":"083a31ee-be9c-443f-af50-d87c724e829f","block_type":"box","text":"the Fund is denominated or by purchasing a currency in which the Fund anticipates acquiring a","page_number":115,"box":{"x":116,"y":444,"width":711,"height":12}},{"id":"b255fbf4-fbb0-4531-813b-5143bb601687","block_type":"box","text":"portfolio position in the near future. A Fund may also hedge a currency by entering into a transaction in","page_number":115,"box":{"x":117,"y":459,"width":767,"height":12}},{"id":"203b8571-60f0-4ecb-9b09-4721a181139e","block_type":"box","text":"a Currency Instrument denominated in a currency other than the currency being hedged (a “cross","page_number":115,"box":{"x":116,"y":475,"width":729,"height":12}},{"id":"9500198a-4ac0-4819-92d7-680262f3b689","block_type":"box","text":"hedge”). A Fund will only enter into a cross-hedge if the Manager believes that (i) there is a","page_number":115,"box":{"x":117,"y":490,"width":680,"height":12}},{"id":"404d33ef-863e-469c-89f3-71d1a59732f2","block_type":"box","text":"demonstrably high correlation between the currency in which the cross-hedge is denominated and the","page_number":115,"box":{"x":116,"y":506,"width":761,"height":12}},{"id":"3d3033b0-494f-47ca-af0c-23b7e1222d31","block_type":"box","text":"currency being hedged, and (ii) executing a cross-hedge through the currency in which the cross","page_number":115,"box":{"x":116,"y":521,"width":722,"height":12}},{"id":"10ee82a7-6003-49b0-bff8-54f334df9d54","block_type":"box","text":"hedge is denominated will be significantly more cost-effective or provide substantially greater liquidity","page_number":115,"box":{"x":117,"y":537,"width":755,"height":12}},{"id":"de528f94-320f-4b9e-b2ea-a28840b6f519","block_type":"box","text":"than executing a similar hedging transaction by means of the currency being hedged.","page_number":115,"box":{"x":116,"y":552,"width":638,"height":12}},{"id":"58d0dba4-1203-4e36-b907-44e128a001de","block_type":"box","text":"A Fund may also engage in proxy hedging transactions to reduce the effect of currency fluctuations on","page_number":115,"box":{"x":116,"y":583,"width":765,"height":12}},{"id":"7f9b1bfe-b29d-4573-8710-1f021b5347ff","block_type":"box","text":"the value of existing or anticipated holdings of portfolio securities. Proxy hedging is often used when","page_number":115,"box":{"x":116,"y":599,"width":747,"height":12}},{"id":"3d28388e-29d5-4da8-b45c-f24f5f51b2de","block_type":"box","text":"the currency to which the Fund is exposed is difficult to hedge, or to hedge against the U.S. dollar.","page_number":115,"box":{"x":116,"y":614,"width":733,"height":12}},{"id":"bc2b511f-32c4-450a-9b68-1735d3f165f6","block_type":"box","text":"Proxy hedging entails entering into a forward contract to sell a currency whose changes in value are","page_number":115,"box":{"x":117,"y":630,"width":746,"height":12}},{"id":"c9816162-b9d8-49fb-8428-cd025b04a236","block_type":"box","text":"generally considered to be linked to a currency or currencies in which some or all of the Fund’s","page_number":115,"box":{"x":116,"y":645,"width":709,"height":12}},{"id":"f45fd54b-1bfd-4719-8bc2-7a9583484248","block_type":"box","text":"securities are, or are expected to be, denominated, and to buy U.S. dollars. Proxy hedging involves","page_number":115,"box":{"x":116,"y":661,"width":736,"height":12}},{"id":"43f14751-c263-48bc-aa34-1f89928ee186","block_type":"box","text":"some of the same risks and considerations as other transactions with similar instruments. Currency","page_number":115,"box":{"x":116,"y":676,"width":737,"height":12}},{"id":"b0d4a1a5-9111-497e-9e59-2b687fbdb68a","block_type":"box","text":"transactions can result in losses to the Fund if the currency being hedged fluctuates in value to a","page_number":115,"box":{"x":116,"y":692,"width":717,"height":12}},{"id":"4b23852a-f5fd-4ac1-b1a5-8f213614477d","block_type":"box","text":"degree or in a direction that is not anticipated. In addition, there is the risk that the perceived linkage","page_number":115,"box":{"x":116,"y":707,"width":742,"height":12}},{"id":"00c1dfb9-a217-4f09-8397-34dd7fae853d","block_type":"box","text":"between various currencies may not be present, including during the particular time that a Fund is","page_number":115,"box":{"x":117,"y":723,"width":724,"height":12}},{"id":"5c64308c-31c6-4238-bed9-af5ade282bac","block_type":"box","text":"engaging in proxy hedging.","page_number":115,"box":{"x":116,"y":738,"width":200,"height":12}},{"id":"1b19252a-c8fb-4612-9447-a1c13f9f8262","block_type":"box","text":"A Fund may also cross-hedge currencies by entering into forward contracts to sell one or more","page_number":115,"box":{"x":116,"y":769,"width":703,"height":12}},{"id":"1e2121fd-dd73-4801-8a28-796208097dda","block_type":"box","text":"currencies that are expected to decline in value relative to other currencies to which the Fund has or in","page_number":115,"box":{"x":116,"y":785,"width":760,"height":12}},{"id":"1dacbfb1-f0ba-4572-a133-1454c15e849f","block_type":"box","text":"which the Fund expects to have portfolio exposure. For example, a Fund may hold both Canadian","page_number":115,"box":{"x":116,"y":800,"width":726,"height":12}},{"id":"0e047c2b-ee01-4221-9af4-c93ebe3646f3","block_type":"box","text":"government bonds and Japanese government bonds, and the Manager or sub-adviser may believe","page_number":115,"box":{"x":116,"y":816,"width":736,"height":12}},{"id":"41771dc9-b097-4169-8a7e-c1d6c4566f7f","block_type":"box","text":"that Canadian dollars will deteriorate against Japanese yen. The Fund would sell Canadian dollars to","page_number":115,"box":{"x":116,"y":831,"width":754,"height":12}},{"id":"60f8fc16-7c7a-4358-87a5-d45c13872760","block_type":"box","text":"reduce its exposure to that currency and buy Japanese yen. This strategy would be a hedge against a","page_number":115,"box":{"x":117,"y":847,"width":761,"height":12}},{"id":"6bfba922-ee72-4e1d-baaa-a8457bcff581","block_type":"box","text":"decline in the value of Canadian dollars, although it would expose the Fund to declines in the value of","page_number":115,"box":{"x":116,"y":862,"width":758,"height":12}},{"id":"3b3b1ced-7412-42b8-9fd7-9b627e933bfc","block_type":"box","text":"the Japanese yen relative to the U.S. dollar.","page_number":115,"box":{"x":116,"y":878,"width":331,"height":12}},{"id":"56814f56-dd2c-4df6-9c81-31dea05aa9a7","block_type":"box","text":"II-31","page_number":115,"box":{"x":484,"y":909,"width":29,"height":9}},{"id":"37644f51-7fff-4f2c-836f-9f99a09ba8ea","block_type":"box","text":"NM0926U-5926888-115/257","page_number":115,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"d5079b99-b27b-4a1f-bed3-94ae72f72cfc","block_type":"box","text":"Some of the forward non-U.S. currency contracts entered into by the Funds are classified as","page_number":116,"box":{"x":116,"y":87,"width":690,"height":12}},{"id":"7d798f7b-63d3-458b-b5d8-b4bc81a70082","block_type":"box","text":"non-deliverable forwards (“NDFs”). NDFs are cash-settled, short-term forward contracts that may be","page_number":116,"box":{"x":117,"y":102,"width":748,"height":13}},{"id":"04e46839-edf2-4b4b-ba12-5398772dd70a","block_type":"box","text":"thinly traded or are denominated in non-convertible foreign currency, where the profit or loss at the","page_number":116,"box":{"x":116,"y":118,"width":736,"height":12}},{"id":"2bb7793f-e79f-4146-9f63-f919de85689b","block_type":"box","text":"time at the settlement date is calculated by taking the difference between the agreed upon exchange","page_number":116,"box":{"x":116,"y":134,"width":752,"height":12}},{"id":"2bf00fad-b0c3-41a2-9411-38a9db76c242","block_type":"box","text":"rate and the spot rate at the time of settlement, for an agreed upon notional amount of funds. All NDFs","page_number":116,"box":{"x":117,"y":149,"width":765,"height":12}},{"id":"665250a7-84bc-4b97-9ec3-774dcf32f43e","block_type":"box","text":"have a fixing date and a settlement date. The fixing date is the date at which the difference between","page_number":116,"box":{"x":117,"y":165,"width":746,"height":12}},{"id":"c9e060a2-79f0-4e94-85d2-435acaf85e59","block_type":"box","text":"the prevailing market exchange rate and the agreed upon exchange rate is calculated. The settlement","page_number":116,"box":{"x":116,"y":180,"width":761,"height":12}},{"id":"fcb6aebf-7a00-4f0a-a720-0f30bcd3df54","block_type":"box","text":"date is the date by which the payment of the difference is due to the party receiving payment. NDFs","page_number":116,"box":{"x":116,"y":196,"width":745,"height":12}},{"id":"46202bd6-9e3f-4c9d-8b35-5b8b3b07dbb8","block_type":"box","text":"are commonly quoted for time periods of one month up to two years, and are normally quoted and","page_number":116,"box":{"x":116,"y":211,"width":733,"height":12}},{"id":"f0db49ee-423e-4259-a811-c806e71cddf0","block_type":"box","text":"settled in U.S. dollars. They are often used to gain exposure to and/or hedge exposure to foreign","page_number":116,"box":{"x":116,"y":227,"width":723,"height":12}},{"id":"5f29e330-7920-4756-88b2-13e28e95cc4f","block_type":"box","text":"currencies that are not internationally traded.","page_number":116,"box":{"x":116,"y":242,"width":337,"height":12}},{"id":"906b66f3-05ca-46e0-9466-773bbaa767ef","block_type":"box","text":"Currency Futures.","page_number":116,"box":{"x":117,"y":273,"width":132,"height":12}},{"id":"495cc1cd-540e-4ad2-8c1e-5b8f403b608c","block_type":"box","text":"A Fund may seek to enhance returns or hedge against the decline in the value of a","page_number":116,"box":{"x":250,"y":273,"width":626,"height":12}},{"id":"264a0998-17f9-4019-90fc-efbccd751fad","block_type":"box","text":"currency through use of currency futures or options on currency futures. Currency futures are similar to","page_number":116,"box":{"x":116,"y":289,"width":769,"height":12}},{"id":"86657f23-a6ee-48b1-97fa-d42e67899166","block_type":"box","text":"forward foreign exchange transactions except that futures are standardized, exchange-traded contracts","page_number":116,"box":{"x":116,"y":304,"width":772,"height":12}},{"id":"2195d0de-2b01-42f9-8adf-c57eea3415bd","block_type":"box","text":"while forward foreign exchange transactions are traded in the OTC market. Currency futures involve","page_number":116,"box":{"x":116,"y":320,"width":747,"height":12}},{"id":"d5dc80e6-ef38-4c3b-9806-7faf7d7b198c","block_type":"box","text":"substantial currency risk as well as the risks discussed above in “— Futures.”","page_number":116,"box":{"x":116,"y":335,"width":578,"height":12}},{"id":"b054edde-1622-4bea-8540-85370a1471cf","block_type":"box","text":"Currency Options.","page_number":116,"box":{"x":117,"y":366,"width":133,"height":12}},{"id":"371e4b9d-4fa2-4ddf-b177-5109e2a2a5f1","block_type":"box","text":"A Fund may seek to enhance returns or hedge against the decline in the value of a","page_number":116,"box":{"x":251,"y":366,"width":626,"height":12}},{"id":"1fcbea54-f126-443e-a9f4-c67888e0ebe6","block_type":"box","text":"currency through the use of currency options. Certain Funds have fundamental investment restrictions","page_number":116,"box":{"x":116,"y":382,"width":763,"height":12}},{"id":"2ebb2b19-0f08-4b2d-b2d4-b2428f1f7a69","block_type":"box","text":"that permit the purchase of currency options, but prohibit the writing of currency options. Currency","page_number":116,"box":{"x":116,"y":397,"width":732,"height":12}},{"id":"ead08a37-80e1-475d-adcb-0724f25114da","block_type":"box","text":"options are similar to options on securities. For example, in consideration for an option premium the","page_number":116,"box":{"x":116,"y":413,"width":745,"height":12}},{"id":"70e9f2a8-f8ad-46cc-b21a-6e25aa09cc7d","block_type":"box","text":"writer of a currency option is obligated to sell (in the case of a call option) or purchase (in the case of a","page_number":116,"box":{"x":116,"y":428,"width":765,"height":12}},{"id":"660ecdc9-006a-4825-8827-f64041e9edec","block_type":"box","text":"put option) a specified amount of a specified currency on or before the expiration date for a specified","page_number":116,"box":{"x":117,"y":444,"width":750,"height":12}},{"id":"9eb22d4f-885a-486d-ba2d-f170ea7b83f6","block_type":"box","text":"amount of another currency. A Fund may engage in transactions in options on currencies either on","page_number":116,"box":{"x":116,"y":459,"width":737,"height":12}},{"id":"8b03ff47-cf0b-4f5d-8b8d-9255ed4bcdf1","block_type":"box","text":"exchanges or OTC markets. Such transactions in options may include exotic options on currencies,","page_number":116,"box":{"x":116,"y":475,"width":743,"height":12}},{"id":"d30836e0-59f2-40e6-8efb-07d070d67131","block_type":"box","text":"which are typically traded in OTC markets and have additional features that result in different payment","page_number":116,"box":{"x":116,"y":490,"width":763,"height":12}},{"id":"f05f28fd-6df2-4684-b11e-bd50e7799f66","block_type":"box","text":"structures and/or expirations. Where a Fund is permitted to write currency options, it may write covered","page_number":116,"box":{"x":116,"y":506,"width":771,"height":12}},{"id":"6c666d50-5462-4419-a26a-16720ddd2b50","block_type":"box","text":"call options on up to 100% of the currencies in its portfolio. See “— Options” above. Currency options","page_number":116,"box":{"x":116,"y":521,"width":757,"height":12}},{"id":"1db08458-5c93-4755-92de-e281ddc1437f","block_type":"box","text":"involve substantial currency risk, and may also involve credit, leverage or illiquidity risk.","page_number":116,"box":{"x":117,"y":537,"width":651,"height":12}},{"id":"c9461d08-5a74-4ecd-9fd7-46648040dcbe","block_type":"box","text":"Currency Swaps.","page_number":116,"box":{"x":117,"y":568,"width":131,"height":12}},{"id":"6f33e599-cd9d-4c48-8ca4-db805e388b4f","block_type":"box","text":"A Fund may enter into currency swaps in order to protect against currency","page_number":116,"box":{"x":248,"y":568,"width":557,"height":12}},{"id":"1e16fc80-2688-460c-9cef-4f8f06bd735d","block_type":"box","text":"fluctuations or to hedge portfolio positions. Currency swaps are transactions in which one currency is","page_number":116,"box":{"x":116,"y":583,"width":754,"height":12}},{"id":"3cbbb792-473a-484d-91a8-f25ce78b215d","block_type":"box","text":"simultaneously bought for a second currency on a spot basis and sold for the second currency on a","page_number":116,"box":{"x":116,"y":599,"width":743,"height":12}},{"id":"536105b4-afc3-437d-beb4-b60fe9a500a8","block_type":"box","text":"forward basis. Currency swaps involve the exchange of the rights of a Fund and another party to make","page_number":116,"box":{"x":116,"y":614,"width":767,"height":12}},{"id":"1602bae4-3522-4860-a6ee-74056780d69f","block_type":"box","text":"or receive payments in specified currencies, and typically require the delivery of the entire principal","page_number":116,"box":{"x":116,"y":630,"width":738,"height":12}},{"id":"f59c3d51-b219-430f-a9e9-da9d6df7025f","block_type":"box","text":"value of one designated currency in exchange for the other designated currency. As a result, the entire","page_number":116,"box":{"x":116,"y":645,"width":768,"height":12}},{"id":"95cd66f2-ab1f-4c2a-870c-79c7c53867f2","block_type":"box","text":"principal value of a currency swap is subject to the risk that the other party to the swap will default on","page_number":116,"box":{"x":117,"y":661,"width":747,"height":12}},{"id":"6497e8c2-a602-4741-b849-9f8ee190ad08","block_type":"box","text":"its contractual delivery obligations.","page_number":116,"box":{"x":117,"y":676,"width":254,"height":12}},{"id":"da3d6814-df4a-4e8e-9a1c-2a64ba5fe535","block_type":"box","text":"Distressed Securities.","page_number":116,"box":{"x":116,"y":707,"width":174,"height":10}},{"id":"3c5c3f58-ca2c-4974-ba4a-73a20f5339dd","block_type":"box","text":"A Fund may invest in securities, including loans purchased in the secondary","page_number":116,"box":{"x":296,"y":707,"width":565,"height":12}},{"id":"56bf6dc5-1d22-4c55-b6d0-b782a18f03f7","block_type":"box","text":"market, that are the subject of bankruptcy proceedings or otherwise in default or in risk of being in","page_number":116,"box":{"x":117,"y":723,"width":724,"height":12}},{"id":"3ed18490-a811-4708-bbad-d1660b5e69cc","block_type":"box","text":"default as to the repayment of principal and/or interest at the time of acquisition by the Fund or that are","page_number":116,"box":{"x":116,"y":738,"width":763,"height":12}},{"id":"923054ed-7e59-43f1-9a29-e3b30aaf334b","block_type":"box","text":"rated in the lower rating categories by one or more nationally recognized statistical rating organizations","page_number":116,"box":{"x":117,"y":754,"width":762,"height":12}},{"id":"f5906a58-2fe2-4ce0-be30-a86bf149781f","block_type":"box","text":"(for example, Ca or lower by Moody’s and CC or lower by S&P or Fitch) or, if unrated, are in the","page_number":116,"box":{"x":117,"y":769,"width":709,"height":12}},{"id":"931fe2b5-7432-4593-b633-457e27ef1fa0","block_type":"box","text":"judgment of the Manager of equivalent quality (“Distressed Securities”). Investment in Distressed","page_number":116,"box":{"x":115,"y":785,"width":719,"height":12}},{"id":"bd7f5b55-9414-42cd-8eb3-7839ef1037be","block_type":"box","text":"Securities is speculative and involves significant risks.","page_number":116,"box":{"x":116,"y":800,"width":399,"height":12}},{"id":"2c8a7d16-9f41-4042-9f7c-b6623a966341","block_type":"box","text":"A Fund will generally make such investments only when the Manager believes it is reasonably likely","page_number":116,"box":{"x":116,"y":831,"width":745,"height":12}},{"id":"418c325f-e52a-40cf-83f0-f897e4c7fd59","block_type":"box","text":"that the issuer of the Distressed Securities will make an exchange offer or will be the subject of a plan","page_number":116,"box":{"x":116,"y":847,"width":760,"height":12}},{"id":"d8fccb0e-eb35-4e1b-9d38-525689367b32","block_type":"box","text":"of reorganization pursuant to which the Fund will receive new securities in return for the Distressed","page_number":116,"box":{"x":116,"y":862,"width":739,"height":12}},{"id":"6ca860ee-55e1-4e68-8870-446ccfd05749","block_type":"box","text":"Securities. However, there can be no assurance that such an exchange offer will be made or that such","page_number":116,"box":{"x":116,"y":878,"width":766,"height":12}},{"id":"a1237f06-ee7c-4ac8-b705-0a2b165c576c","block_type":"box","text":"II-32","page_number":116,"box":{"x":484,"y":909,"width":31,"height":9}},{"id":"5dbfb102-420a-4587-9754-6039ab4d9154","block_type":"box","text":"NM0926U-5926888-116/257","page_number":116,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"f7390817-01bd-475c-b3ca-9cccfb9a1ab6","block_type":"box","text":"a plan of reorganization will be adopted. In addition, a significant period of time may pass between the","page_number":117,"box":{"x":116,"y":87,"width":762,"height":12}},{"id":"3ce3b519-aaf8-40b9-846f-a9f3edd716e2","block_type":"box","text":"time at which a Fund makes its investment in Distressed Securities and the time that any such","page_number":117,"box":{"x":116,"y":102,"width":704,"height":13}},{"id":"0ee9ded1-c6d6-4930-96c3-41af66aede9e","block_type":"box","text":"exchange offer or plan of reorganization is completed. During this period, it is unlikely that a Fund will","page_number":117,"box":{"x":116,"y":118,"width":756,"height":12}},{"id":"6f0f2f9c-5d08-425f-a343-75a53d806acb","block_type":"box","text":"receive any interest payments on the Distressed Securities, the Fund will be subject to significant","page_number":117,"box":{"x":117,"y":134,"width":725,"height":12}},{"id":"10652bf2-6a74-4e7b-bbd0-fed13604c271","block_type":"box","text":"uncertainty as to whether or not the exchange offer or plan of reorganization will be completed and the","page_number":117,"box":{"x":117,"y":149,"width":764,"height":12}},{"id":"d5a6ba2e-df6b-4c76-9872-0fb764ec3b94","block_type":"box","text":"Fund may be required to bear certain extraordinary expenses to protect and recover its investment.","page_number":117,"box":{"x":117,"y":165,"width":741,"height":12}},{"id":"4bc670bf-eafb-4090-b841-974fd5c8d54a","block_type":"box","text":"Therefore, to the extent the Fund seeks capital appreciation through investment in distressed","page_number":117,"box":{"x":116,"y":180,"width":696,"height":12}},{"id":"26d5f7ac-57a4-412e-8b46-a9db00d7e37f","block_type":"box","text":"securities, the Fund’s ability to achieve current income for its shareholders may be diminished. The","page_number":117,"box":{"x":116,"y":196,"width":740,"height":12}},{"id":"a40bb1a8-f6e4-445c-8dc7-40ccdde9f273","block_type":"box","text":"Fund also will be subject to significant uncertainty as to when and in what manner and for what value","page_number":117,"box":{"x":117,"y":211,"width":753,"height":12}},{"id":"e0f3d211-6521-4490-ba86-5935e88b59a8","block_type":"box","text":"the obligations evidenced by the distressed securities will eventually be satisfied (","page_number":117,"box":{"x":116,"y":227,"width":605,"height":12}},{"id":"b5442dd3-dc8c-4f9a-8764-088f4bfa7950","block_type":"box","text":"e.g.","page_number":117,"box":{"x":723,"y":229,"width":25,"height":10}},{"id":"048ef251-54bc-49fc-b22c-da3e33e877c3","block_type":"box","text":", through a","page_number":117,"box":{"x":751,"y":227,"width":84,"height":12}},{"id":"e7851a13-77f4-43fe-945b-0e24a6092a18","block_type":"box","text":"liquidation of the obligor’s assets, an exchange offer or plan of reorganization involving the distressed","page_number":117,"box":{"x":117,"y":242,"width":756,"height":12}},{"id":"6468b43b-35bd-46c9-a7dc-94104856d47f","block_type":"box","text":"securities or a payment of some amount in satisfaction of the obligation). Even if an exchange offer is","page_number":117,"box":{"x":116,"y":258,"width":757,"height":12}},{"id":"c26d18f2-9acf-426a-a432-69fc3a5072c7","block_type":"box","text":"made or plan of reorganization is adopted with respect to Distressed Securities held by a Fund, there","page_number":117,"box":{"x":117,"y":273,"width":754,"height":12}},{"id":"ca581049-4a9e-438e-b9f9-cb8c11014d2c","block_type":"box","text":"can be no assurance that the securities or other assets received by a Fund in connection with such","page_number":117,"box":{"x":116,"y":289,"width":740,"height":12}},{"id":"0b6b30c3-46b2-47d5-a59c-ff85ee0d2805","block_type":"box","text":"exchange offer or plan of reorganization will not have a lower value or income potential than may have","page_number":117,"box":{"x":116,"y":304,"width":765,"height":12}},{"id":"5952d23d-36ef-4d9a-bca4-50128286d951","block_type":"box","text":"been anticipated when the investment was made or no value. Moreover, any securities received by a","page_number":117,"box":{"x":117,"y":320,"width":753,"height":12}},{"id":"ade47535-e324-4cd6-92ab-d8fc6bf3ec61","block_type":"box","text":"Fund upon completion of an exchange offer or plan of reorganization may be restricted as to resale.","page_number":117,"box":{"x":117,"y":335,"width":745,"height":12}},{"id":"2a87a09a-3003-4e10-89cc-d75a3a1b05e3","block_type":"box","text":"Similarly, if a Fund participates in negotiations with respect to any exchange offer or plan of","page_number":117,"box":{"x":116,"y":351,"width":683,"height":12}},{"id":"f1d06dc9-e164-4480-b22e-70ff0b19abfc","block_type":"box","text":"reorganization with respect to an issuer of Distressed Securities, the Fund may be restricted from","page_number":117,"box":{"x":117,"y":366,"width":726,"height":12}},{"id":"ce93c81c-6258-4a9b-9770-96dace82d277","block_type":"box","text":"disposing of such securities. To the extent that a Fund becomes involved in such proceedings, the","page_number":117,"box":{"x":116,"y":382,"width":734,"height":12}},{"id":"870a3d43-160e-45eb-96b1-e60bfac181ad","block_type":"box","text":"Fund may have a more active participation in the affairs of the issuer than that assumed generally by","page_number":117,"box":{"x":117,"y":397,"width":752,"height":12}},{"id":"cfbbae7d-c8eb-4aa0-9faf-d03c415a4c6a","block_type":"box","text":"an investor. The Fund, however, will not make investments for the purpose of exercising day-to-day","page_number":117,"box":{"x":116,"y":413,"width":744,"height":12}},{"id":"4abeabb8-2588-4afe-912f-6bd20e82c029","block_type":"box","text":"management of any issuer’s affairs.","page_number":117,"box":{"x":117,"y":428,"width":269,"height":12}},{"id":"07756ba3-a4f2-405c-a16a-9bc2530d6bf6","block_type":"box","text":"Environmental, Social and Governance (“ESG”) Integration.","page_number":117,"box":{"x":116,"y":459,"width":476,"height":12}},{"id":"7b757b18-aedc-4360-a664-6eff5f38ce5a","block_type":"box","text":"Although a Fund does not seek to","page_number":117,"box":{"x":593,"y":459,"width":261,"height":12}},{"id":"5f853e92-acb6-4b0d-bc4d-35adcd8d60c4","block_type":"box","text":"implement a specific sustainability objective, strategy or process unless disclosed in its Prospectus,","page_number":117,"box":{"x":117,"y":475,"width":741,"height":12}},{"id":"5fbfcadf-b3ed-4ff4-9d89-6824bf359bad","block_type":"box","text":"Fund management will consider ESG factors as part of the investment process for the Fund. Fund","page_number":117,"box":{"x":117,"y":490,"width":733,"height":12}},{"id":"db6b9f81-8e10-4688-af7f-8612aee7905d","block_type":"box","text":"management views ESG integration as the practice of incorporating financially material ESG data or","page_number":117,"box":{"x":117,"y":506,"width":747,"height":12}},{"id":"4b37d430-175d-457c-9768-b234ca47cb1c","block_type":"box","text":"information into investment processes with the objective of enhancing risk-adjusted returns. These","page_number":117,"box":{"x":117,"y":521,"width":734,"height":12}},{"id":"fc2fe598-6092-40f4-b80f-6727619d535e","block_type":"box","text":"ESG considerations will vary depending on a Fund’s particular investment strategies and may include","page_number":117,"box":{"x":117,"y":537,"width":757,"height":12}},{"id":"6bb175f9-463e-42da-ad62-e49cf94d541b","block_type":"box","text":"consideration of third-party research as well as consideration of proprietary BlackRock research across","page_number":117,"box":{"x":116,"y":552,"width":770,"height":12}},{"id":"43e0dde1-d237-45b2-8424-cde9978b63cc","block_type":"box","text":"the ESG risks and opportunities regarding an issuer. The ESG characteristics utilized in a Fund’s","page_number":117,"box":{"x":116,"y":568,"width":725,"height":12}},{"id":"d201790a-8c88-4499-a078-a90d1403c049","block_type":"box","text":"investment process are anticipated to evolve over time and one or more characteristics may not be","page_number":117,"box":{"x":117,"y":583,"width":738,"height":12}},{"id":"f038339a-f563-444c-bf57-0b4047a6e7f7","block_type":"box","text":"relevant with respect to all issuers that are eligible for investment.","page_number":117,"box":{"x":117,"y":599,"width":490,"height":12}},{"id":"f53d1adc-7072-4563-8773-f6edf942940d","block_type":"box","text":"Certain of these considerations may affect a Fund’s exposure to certain companies or industries. While","page_number":117,"box":{"x":117,"y":630,"width":769,"height":12}},{"id":"abbdce2a-b94c-4239-afff-877edf94e3c0","block_type":"box","text":"Fund management views ESG considerations as having the potential to contribute to a Fund’s long","page_number":117,"box":{"x":117,"y":645,"width":740,"height":12}},{"id":"27572494-6b6f-4a17-ac13-1232d2e55e08","block_type":"box","text":"term performance, there is no guarantee that such results will be achieved.","page_number":117,"box":{"x":116,"y":661,"width":555,"height":12}},{"id":"91dbbbac-df8d-47d0-8411-a823853a714b","block_type":"box","text":"Equity Securities.","page_number":117,"box":{"x":116,"y":692,"width":140,"height":12}},{"id":"beced108-d032-4093-9c3f-12e1cff04d21","block_type":"box","text":"Certain Funds may invest in equity securities, which include common stock and, for","page_number":117,"box":{"x":263,"y":692,"width":618,"height":12}},{"id":"c38cf270-ed1b-4915-95b2-406ff848dbff","block_type":"box","text":"certain Funds, preferred stock (including convertible preferred stock); bonds; stock purchase warrants","page_number":117,"box":{"x":116,"y":707,"width":755,"height":12}},{"id":"d66bb768-ffa9-44d9-b6c5-fefa2c78c769","block_type":"box","text":"and rights; equity interests in trusts; general and limited partnerships and limited liability companies;","page_number":117,"box":{"x":116,"y":723,"width":739,"height":12}},{"id":"48d9836e-cd20-47ad-af98-54a41282ad1a","block_type":"box","text":"and depositary receipts. Stock markets are volatile. The price of equity securities will fluctuate and can","page_number":117,"box":{"x":116,"y":738,"width":759,"height":12}},{"id":"e14fe172-1111-4f73-9656-15f2a1530a6b","block_type":"box","text":"decline and reduce the value of a portfolio investing in equities. The price of equity securities fluctuates","page_number":117,"box":{"x":116,"y":754,"width":763,"height":12}},{"id":"d6539984-f1e7-4660-aa23-430448c36456","block_type":"box","text":"based on changes in a company’s financial condition and overall market and economic conditions. The","page_number":117,"box":{"x":117,"y":769,"width":762,"height":12}},{"id":"95c30385-bbcb-4183-b8e7-b87e4489bdeb","block_type":"box","text":"value of equity securities purchased by the Fund could decline if the financial condition of the","page_number":117,"box":{"x":116,"y":785,"width":689,"height":12}},{"id":"c202b84e-91ee-47d8-bbb7-867ff91ff474","block_type":"box","text":"companies the Fund invests in decline or if overall market and economic conditions deteriorate. They","page_number":117,"box":{"x":116,"y":800,"width":750,"height":12}},{"id":"e59dbbe8-8326-4c64-b707-68e2bbf088d5","block_type":"box","text":"may also decline due to factors that affect a particular industry or industries, such as labor shortages or","page_number":117,"box":{"x":117,"y":816,"width":766,"height":12}},{"id":"fd367fbc-13cb-4665-abd9-bb888286a3ea","block_type":"box","text":"increase in production costs and competitive conditions within an industry. In addition, they may","page_number":117,"box":{"x":117,"y":831,"width":714,"height":12}},{"id":"34f248e2-0264-4d75-9c48-ce909e81f831","block_type":"box","text":"decline due to general market conditions that are not specifically related to a company or industry,","page_number":117,"box":{"x":116,"y":847,"width":732,"height":12}},{"id":"205b0c9d-5499-45f1-bf2c-5c30b1fa8ca6","block_type":"box","text":"such as real or perceived adverse economic conditions, changes in the general outlook for corporate","page_number":117,"box":{"x":116,"y":862,"width":753,"height":12}},{"id":"571efdcc-a1c8-426f-956f-44c196ee7fb4","block_type":"box","text":"earnings, changes in interest or currency rates or generally adverse investor sentiment.","page_number":117,"box":{"x":116,"y":878,"width":654,"height":12}},{"id":"e43da30e-6490-4e20-aa35-05468cc83bc3","block_type":"box","text":"II-33","page_number":117,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"3b473d0a-0cd6-44f6-8641-cec5aaba682c","block_type":"box","text":"NM0926U-5926888-117/257","page_number":117,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"c096eb13-68ba-4e50-bf1d-07e7486c920d","block_type":"box","text":"From time to time certain of the Funds may invest in","page_number":118,"box":{"x":117,"y":87,"width":368,"height":12}},{"id":"ecfeb96f-e8dd-4fa4-8233-d6be3a7e6c3b","block_type":"box","text":"shares of companies through initial public offerings","page_number":118,"box":{"x":486,"y":87,"width":369,"height":12}},{"id":"faaf3815-8098-47f5-9fdb-1ecc70fd53c2","block_type":"box","text":"(“IPOs”). IPOs have the potential to produce, and have in fact produced, substantial gains for certain Funds.","page_number":118,"box":{"x":117,"y":102,"width":769,"height":13}},{"id":"f66928b4-cb4a-4b24-bdca-56f070ec98cb","block_type":"box","text":"There is no assurance that any Fund will have continued a","page_number":118,"box":{"x":116,"y":118,"width":415,"height":12}},{"id":"056b05f0-6d04-41bc-a004-72580d3fe9f7","block_type":"box","text":"ccess to profitable IPOs and therefore investors","page_number":118,"box":{"x":532,"y":118,"width":343,"height":12}},{"id":"ac4491ff-6444-4c0b-9e51-40473c609632","block_type":"box","text":"should not rely on these past gains as an indication of future performance. The investment performance of","page_number":118,"box":{"x":116,"y":134,"width":759,"height":12}},{"id":"e10836bc-1d27-4e22-bb5c-a318707bfc5b","block_type":"box","text":"a Fund during periods when it is unable to invest signifi","page_number":118,"box":{"x":116,"y":149,"width":389,"height":12}},{"id":"0313760c-b250-423c-bc37-e404fcc023fd","block_type":"box","text":"cantly or at all in IPOs may be lower than during","page_number":118,"box":{"x":506,"y":149,"width":345,"height":12}},{"id":"049ce1c0-d332-44b2-a65a-08139a23d7e6","block_type":"box","text":"periods when it is able to do so. In addition, as a Fund increases in size, the impact of IPOs on its","page_number":118,"box":{"x":117,"y":165,"width":694,"height":11}},{"id":"8c9e2048-f1c9-4762-b910-2b83edab2f0f","block_type":"box","text":"performance will generally decrease. Securities issued in IPOs are subject to many of the same risks as","page_number":118,"box":{"x":117,"y":180,"width":741,"height":12}},{"id":"f198383c-3403-42db-ae21-8cdc94b853cc","block_type":"box","text":"investing in companies with smaller market capita","page_number":118,"box":{"x":117,"y":196,"width":351,"height":12}},{"id":"64bf69c4-1e89-47c5-b3cb-d2d087b09822","block_type":"box","text":"lizations. Securities issued in IPOs have no trading","page_number":118,"box":{"x":470,"y":196,"width":364,"height":12}},{"id":"e670cdfe-b353-45dd-8955-98db48b68966","block_type":"box","text":"history, and information about the companies may be av","page_number":118,"box":{"x":117,"y":211,"width":399,"height":12}},{"id":"08523d21-b0af-4f5b-8df3-e53da950acb6","block_type":"box","text":"ailable for very limited periods. In addition, the","page_number":118,"box":{"x":516,"y":211,"width":330,"height":12}},{"id":"4c6da6f0-a144-4d2d-9015-ad875ec3a4d3","block_type":"box","text":"prices of securities sold in IPOs may be highly volatile","page_number":118,"box":{"x":117,"y":227,"width":380,"height":12}},{"id":"212f22d0-270a-40d0-82fe-781239bb34bd","block_type":"box","text":"or may decline shortly after the initial public offering.","page_number":118,"box":{"x":497,"y":227,"width":377,"height":12}},{"id":"375b644d-42c3-422c-8214-1b78b3f86ee0","block_type":"box","text":"The Funds may invest in companies that have relatively small market capitalizations. These","page_number":118,"box":{"x":116,"y":258,"width":685,"height":12}},{"id":"49108ad4-7df3-4e05-8375-de996bd8c0c9","block_type":"box","text":"organizations will normally have more limited product lines, markets and financial resources and will be","page_number":118,"box":{"x":116,"y":273,"width":769,"height":12}},{"id":"9fe8c7be-c187-41a9-a913-62fdca4cf2d7","block_type":"box","text":"dependent upon a more limited management group than larger capitalized companies. In addition, it is","page_number":118,"box":{"x":116,"y":289,"width":764,"height":12}},{"id":"1f408ba8-cf0e-44d2-b347-6daa70a594f9","block_type":"box","text":"more difficult to get information on smaller companies, which tend to be less well known, have shorter","page_number":118,"box":{"x":117,"y":304,"width":758,"height":12}},{"id":"90241302-cda7-43b5-a2e5-02bc26ec5e5b","block_type":"box","text":"operating histories, do not have significant ownership by large investors and are followed by relatively","page_number":118,"box":{"x":116,"y":320,"width":758,"height":12}},{"id":"400a0cdf-3d67-4ac0-8b82-b35a21898bfa","block_type":"box","text":"few securities analysts. The securities of smaller capitalized companies are often traded in the OTC","page_number":118,"box":{"x":116,"y":335,"width":744,"height":12}},{"id":"b62d414d-275d-4892-8961-ac83d4b481b0","block_type":"box","text":"markets and may have fewer market makers and wider price spreads. This may result in greater price","page_number":118,"box":{"x":117,"y":351,"width":760,"height":12}},{"id":"656021a7-da1b-42a7-b1d0-6b9aff5acb98","block_type":"box","text":"movements and less ability to sell a Fund’s investment than if the Fund held the securities of larger,","page_number":118,"box":{"x":117,"y":366,"width":743,"height":12}},{"id":"29f95b90-3f7d-4a32-af78-33ee78a8076e","block_type":"box","text":"more established companies.","page_number":118,"box":{"x":117,"y":382,"width":222,"height":12}},{"id":"b1426e62-47e3-4ecb-b684-91938b1b055e","block_type":"box","text":"For a discussion of the types of equity securities in which your Fund may invest and the risks","page_number":118,"box":{"x":117,"y":413,"width":693,"height":12}},{"id":"29185988-a08c-4349-8046-31fc16755460","block_type":"box","text":"associated with investing in such equity securities, see your Fund’s Prospectus. Certain of the Funds","page_number":118,"box":{"x":116,"y":428,"width":754,"height":12}},{"id":"d9e9d771-cb50-4f87-af7a-d360eb7f2c12","block_type":"box","text":"may also invest in shares of private companies, which are subject to the risks of “Illiquid Investments”","page_number":118,"box":{"x":117,"y":444,"width":756,"height":12}},{"id":"fa1c61a1-792b-4cb7-a2c2-ccdde7b38ef9","block_type":"box","text":"and “Restricted Securities” described below.","page_number":118,"box":{"x":116,"y":459,"width":334,"height":10}},{"id":"a2ab8da5-cb77-489c-afd6-4c8505e88e5b","block_type":"box","text":"Real Estate-Related Securities.","page_number":118,"box":{"x":116,"y":490,"width":232,"height":10}},{"id":"d5b6e3a5-f52d-4940-965d-73d3aaac56d8","block_type":"box","text":"Although no Fund may invest directly in real estate, certain Funds may","page_number":118,"box":{"x":349,"y":490,"width":535,"height":12}},{"id":"6dfd46c6-23a1-4fef-89d9-92c2aca1eb8e","block_type":"box","text":"invest in equity securities of issuers that are principally engaged in the real estate industry. Such","page_number":118,"box":{"x":117,"y":506,"width":719,"height":12}},{"id":"a5972935-b9b6-4127-81f7-c20d18402299","block_type":"box","text":"investments are subject to certain risks associated with the ownership of real estate and with the real","page_number":118,"box":{"x":117,"y":521,"width":753,"height":12}},{"id":"c2676065-d3d8-4806-a980-1f6682cbbe0a","block_type":"box","text":"estate industry in general. These risks include, among others: possible declines in the value of real","page_number":118,"box":{"x":116,"y":537,"width":738,"height":12}},{"id":"e84e1d34-4565-4a16-9b1e-c073fc0da91d","block_type":"box","text":"estate; risks related to general and local economic conditions; possible lack of availability of mortgage","page_number":118,"box":{"x":116,"y":552,"width":760,"height":12}},{"id":"66a1afb6-5cf5-40b0-ac86-a3bad7bca703","block_type":"box","text":"funds or other limitations on access to capital; overbuilding; risks associated with leverage; market","page_number":118,"box":{"x":116,"y":568,"width":734,"height":12}},{"id":"926edce8-c873-48e0-8079-98bc1db9f162","block_type":"box","text":"illiquidity; extended vacancies of properties; increase in competition, property taxes, capital","page_number":118,"box":{"x":117,"y":583,"width":679,"height":12}},{"id":"723774e6-d138-4a98-9b9d-a4aa3bf5f348","block_type":"box","text":"expenditures and operating expenses; changes in zoning laws or other governmental regulation; costs","page_number":118,"box":{"x":116,"y":599,"width":765,"height":12}},{"id":"23dc8dac-8dcd-4147-9303-7bf12f0eb90b","block_type":"box","text":"resulting from the clean-up of, and liability to third parties for damages resulting from, environmental","page_number":118,"box":{"x":117,"y":614,"width":746,"height":12}},{"id":"0f8d47e6-6b1e-4077-a4d3-af054943bd6b","block_type":"box","text":"problems; tenant bankruptcies or other credit problems; casualty or condemnation losses; uninsured","page_number":118,"box":{"x":117,"y":630,"width":748,"height":12}},{"id":"f598b04e-0dbf-4bbd-b666-cd81f5016f95","block_type":"box","text":"damages from floods, earthquakes or other natural disasters; limitations on and variations in rents,","page_number":118,"box":{"x":116,"y":645,"width":736,"height":12}},{"id":"0c1b9032-4b73-435c-b913-2baa612d8fb8","block_type":"box","text":"including decreases in market rates for rents; investment in developments that are not completed or","page_number":118,"box":{"x":117,"y":661,"width":740,"height":12}},{"id":"0bb1464a-0df1-411c-b1bc-a4f6187c8a35","block_type":"box","text":"that are subject to delays in completion; and changes in interest rates. To the extent that assets","page_number":118,"box":{"x":116,"y":676,"width":710,"height":12}},{"id":"c7775d46-4046-49f8-abc7-0ab9a53187c7","block_type":"box","text":"underlying a Fund’s investments are concentrated geographically, by property type or in certain other","page_number":118,"box":{"x":117,"y":692,"width":750,"height":12}},{"id":"3bf60435-23cf-42e4-8ad5-e1256da2974d","block_type":"box","text":"respects, the Fund may be subject to certain of the foregoing risks to a greater extent. Investments by","page_number":118,"box":{"x":117,"y":707,"width":755,"height":12}},{"id":"44d30c7a-d2d6-4486-ac6a-22d4ca7cbb4d","block_type":"box","text":"a Fund in securities of companies providing mortgage servicing will be subject to the risks associated","page_number":118,"box":{"x":116,"y":723,"width":750,"height":12}},{"id":"4d0dc449-6c3b-483a-a131-9764b3d01d8b","block_type":"box","text":"with refinancings and their impact on servicing rights.","page_number":118,"box":{"x":116,"y":738,"width":393,"height":12}},{"id":"571e053f-7d1a-4439-b53d-717172247e0d","block_type":"box","text":"In addition, if a Fund receives rental income or income from the disposition of real property acquired as","page_number":118,"box":{"x":117,"y":769,"width":763,"height":12}},{"id":"91287aff-5337-4adf-ba03-0d3bec5ab779","block_type":"box","text":"a result of a default on securities the Fund owns, the receipt of such income may adversely affect the","page_number":118,"box":{"x":116,"y":785,"width":750,"height":12}},{"id":"e029b5fb-ab5b-408b-830a-1c9002c04a5f","block_type":"box","text":"Fund’s ability to retain its tax status as a regulated investment company because of certain income","page_number":118,"box":{"x":117,"y":800,"width":732,"height":12}},{"id":"60f42890-2cda-421f-baaa-0cac0e5551fe","block_type":"box","text":"source requirements applicable to regulated investment companies under the Internal Revenue Code","page_number":118,"box":{"x":116,"y":816,"width":752,"height":12}},{"id":"0f050c71-d6b0-43e3-8cf0-9aa5e4f57d79","block_type":"box","text":"of 1986, as amended (the “Code”).","page_number":118,"box":{"x":116,"y":831,"width":263,"height":12}},{"id":"9e2aa922-41d7-490d-bf0b-4a40026aaae8","block_type":"box","text":"Securities of Smaller or Emerging Growth Companies.","page_number":118,"box":{"x":117,"y":862,"width":401,"height":12}},{"id":"334f2688-ebc6-4ddd-be91-fb08964a3006","block_type":"box","text":"Investment in smaller or emerging growth","page_number":118,"box":{"x":520,"y":862,"width":318,"height":12}},{"id":"0f0ce806-4f7b-4597-86f9-656691f85d85","block_type":"box","text":"companies involves greater risk than is customarily associated with investments in more established","page_number":118,"box":{"x":116,"y":878,"width":749,"height":12}},{"id":"f60e0e72-847c-45ea-85ad-9cc1250c1bb0","block_type":"box","text":"II-34","page_number":118,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"22de570b-3853-4a0e-9afc-27aa667eb4fc","block_type":"box","text":"NM0926U-5926888-118/257","page_number":118,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"d00acf3a-31a7-4317-9c3d-235603a1ff8c","block_type":"box","text":"companies. The securities of smaller or emerging growth companies may be subject to more abrupt or","page_number":119,"box":{"x":116,"y":87,"width":765,"height":12}},{"id":"8dba1ee0-b7b6-44c8-af5f-780e0fd15db6","block_type":"box","text":"erratic market movements than larger, more established companies or the market average in general.","page_number":119,"box":{"x":116,"y":103,"width":761,"height":12}},{"id":"d1977bc7-ad85-4446-9aaa-1004aa1b801d","block_type":"box","text":"These companies may have limited product lines, markets or financial resources, or they may be","page_number":119,"box":{"x":116,"y":118,"width":723,"height":12}},{"id":"dbd8feaa-a2e3-4402-993d-091e6b12f62f","block_type":"box","text":"dependent on a limited management group.","page_number":119,"box":{"x":116,"y":134,"width":330,"height":12}},{"id":"63978919-0acb-4727-8532-3ba4b3fe6a9c","block_type":"box","text":"Investments in smaller or emerging growth companies may involve greater risks and thus may be","page_number":119,"box":{"x":117,"y":163,"width":771,"height":12}},{"id":"fc08414f-7425-4876-8ca0-ae5ab07f17b5","block_type":"box","text":"considered speculative. Full development of these companies and trends frequently takes time.","page_number":119,"box":{"x":116,"y":178,"width":713,"height":12}},{"id":"e7732e49-b725-49b8-b99c-0c5370401f4c","block_type":"box","text":"Small cap and emerging growth securities will often be traded only in the OTC market or on a regional","page_number":119,"box":{"x":116,"y":207,"width":762,"height":12}},{"id":"8a731261-4c90-4633-8685-a57b8e84616a","block_type":"box","text":"securities exchange and may not be traded every day or in the volume typical of trading on a national","page_number":119,"box":{"x":116,"y":223,"width":757,"height":12}},{"id":"3bfb1bef-e615-47db-97c7-88248af1c235","block_type":"box","text":"securities exchange. As a result, the disposition by a Fund of portfolio securities to meet redemptions","page_number":119,"box":{"x":116,"y":238,"width":756,"height":12}},{"id":"8bb2d0a3-2c70-40ef-af4e-e4fbc9fc57f6","block_type":"box","text":"or otherwise may require the Fund to make many small sales over a lengthy period of time, or to sell","page_number":119,"box":{"x":116,"y":254,"width":749,"height":12}},{"id":"23d90963-48de-4c09-8878-c3c602cbef77","block_type":"box","text":"these securities at a discount from market prices or during periods when, in Fund management’s","page_number":119,"box":{"x":116,"y":269,"width":722,"height":12}},{"id":"98e2ef02-4f4f-4fa9-9daa-ce3471eb2cb5","block_type":"box","text":"judgment, such disposition is not desirable.","page_number":119,"box":{"x":115,"y":285,"width":326,"height":12}},{"id":"68bd5d1e-1c1b-4915-bae5-87dae9ad9b92","block_type":"box","text":"The process of selection and continuous supervision by Fund management does not guarantee","page_number":119,"box":{"x":116,"y":314,"width":714,"height":12}},{"id":"ced5b889-d452-47a4-97c3-fb573c1d821a","block_type":"box","text":"successful investment results. Careful initial selection is particularly important in this area as many new","page_number":119,"box":{"x":116,"y":329,"width":770,"height":12}},{"id":"c2f76756-2a26-4122-ab81-979d7047b21a","block_type":"box","text":"enterprises have promise but lack certain of the fundamental factors necessary to prosper. Investing in","page_number":119,"box":{"x":116,"y":345,"width":767,"height":12}},{"id":"91277c52-76cb-4c49-b94a-967373adb9b0","block_type":"box","text":"small cap and emerging growth companies requires specialized research and analysis.","page_number":119,"box":{"x":116,"y":360,"width":651,"height":12}},{"id":"015e090a-763a-4a71-b708-8c42df7d0626","block_type":"box","text":"Fund management believes that relatively small companies may have the opportunity to develop into","page_number":119,"box":{"x":117,"y":389,"width":753,"height":12}},{"id":"49180619-5b30-46a5-9d82-7e10ac1b876a","block_type":"box","text":"significant business enterprises. A Fund may invest in securities of small issuers in the relatively early","page_number":119,"box":{"x":116,"y":405,"width":759,"height":12}},{"id":"e274068e-33dc-49e1-aaad-185e32c9d24f","block_type":"box","text":"stages of business development that have a new technology, a unique or proprietary product or","page_number":119,"box":{"x":116,"y":420,"width":714,"height":12}},{"id":"feea8bd9-0bcb-42f3-a109-741b4ea01362","block_type":"box","text":"service, or a favorable market position.","page_number":119,"box":{"x":116,"y":436,"width":294,"height":12}},{"id":"203b3f5c-d80a-4a37-9fff-7c2554136263","block_type":"box","text":"Equity securities of specific small cap issuers may present different opportunities for long-term capital","page_number":119,"box":{"x":117,"y":465,"width":757,"height":12}},{"id":"753d2a8c-5563-4455-bec3-a675e5395c24","block_type":"box","text":"appreciation during varying portions of economic or securities market cycles, as well as during varying","page_number":119,"box":{"x":116,"y":480,"width":763,"height":13}},{"id":"5462d66f-b6c2-4269-8e7a-ea781f408004","block_type":"box","text":"stages of their business development. The market valuation of small cap issuers tends to fluctuate","page_number":119,"box":{"x":116,"y":496,"width":734,"height":12}},{"id":"cd3a7e24-285d-4b08-8c1b-80cb232fea36","block_type":"box","text":"during economic or market cycles.","page_number":119,"box":{"x":116,"y":512,"width":260,"height":12}},{"id":"1ea0da63-f518-44ca-92f4-158aa625d6f9","block_type":"box","text":"Tracking Stocks","page_number":119,"box":{"x":118,"y":540,"width":117,"height":13}},{"id":"357e35c3-8295-4946-858a-ef0f72b2ba95","block_type":"box","text":". A tracking stock is a separate class of common stock whose value is linked to a","page_number":119,"box":{"x":237,"y":540,"width":604,"height":13}},{"id":"29486fdb-d6f6-4ef0-a161-b57a774db037","block_type":"box","text":"specific business unit or operating division within a larger company and is designed to “track” the","page_number":119,"box":{"x":116,"y":556,"width":723,"height":12}},{"id":"5d458b1f-0dcb-42f5-b57e-a8c6592e9435","block_type":"box","text":"performance of such business unit or division. The tracking stock may pay dividends to shareholders","page_number":119,"box":{"x":117,"y":571,"width":751,"height":13}},{"id":"aec4c54b-fb49-4cad-827c-3f27a8d93f59","block_type":"box","text":"independent of the parent company. The parent company, rather than the business unit or division,","page_number":119,"box":{"x":117,"y":587,"width":739,"height":12}},{"id":"e86cf8ec-5b67-472f-b7d7-cf33edc93c85","block_type":"box","text":"generally is the issuer of tracking stock. However, holders of the tracking stock may not have the same","page_number":119,"box":{"x":116,"y":602,"width":768,"height":13}},{"id":"585944ed-3830-4989-b94e-868d3192206e","block_type":"box","text":"rights as holders of the company’s common stock.","page_number":119,"box":{"x":117,"y":618,"width":377,"height":12}},{"id":"7cc16d0c-7e58-49d2-835d-7bd7e8e22a2b","block_type":"box","text":"Exchange-Traded Notes (“ETNs”).","page_number":119,"box":{"x":116,"y":647,"width":271,"height":12}},{"id":"529895d5-5e86-41f8-8770-ea88f4277614","block_type":"box","text":"Certain Funds may invest in ETNs. ETNs are generally notes","page_number":119,"box":{"x":389,"y":647,"width":464,"height":12}},{"id":"b7a7c864-0179-4042-a409-43f89add86da","block_type":"box","text":"representing debt of the issuer, usually a financial institution. ETNs combine aspects of both bonds and","page_number":119,"box":{"x":117,"y":663,"width":765,"height":12}},{"id":"7b55581c-d47c-41c8-978d-1b22d1bf4ebe","block_type":"box","text":"ETFs. An ETN’s returns are based on the performance of one or more underlying assets, reference","page_number":119,"box":{"x":117,"y":678,"width":737,"height":12}},{"id":"277b0e5c-f5c2-4b4a-b82b-95f5252b0c24","block_type":"box","text":"rates or indexes, minus fees and expenses. Similar to ETFs, ETNs are listed on an exchange and","page_number":119,"box":{"x":117,"y":694,"width":724,"height":12}},{"id":"02df0163-2641-4cee-ad96-54dad43764a6","block_type":"box","text":"traded in the secondary market. However, unlike an ETF, an ETN can be held until the ETN’s maturity,","page_number":119,"box":{"x":116,"y":709,"width":761,"height":12}},{"id":"de27b1bc-2a5b-43f5-80fa-4ce90ddb6028","block_type":"box","text":"at which time the issuer will pay a return linked to the performance of the specific asset, index or rate","page_number":119,"box":{"x":116,"y":725,"width":748,"height":12}},{"id":"c6799ff6-892b-413b-bdea-9777b0234aca","block_type":"box","text":"(“reference instrument”) to which the ETN is linked minus certain fees. Unlike regular bonds, ETNs do","page_number":119,"box":{"x":117,"y":740,"width":753,"height":12}},{"id":"8f9ddcb7-a147-44f9-a66e-b61ff68cbf8a","block_type":"box","text":"not make periodic interest payments, and principal is not protected.","page_number":119,"box":{"x":117,"y":756,"width":497,"height":12}},{"id":"72639382-adb3-424f-a9a9-c2457a5fc02d","block_type":"box","text":"The value of an ETN may be influenced by, among other things, time to maturity, level of supply and","page_number":119,"box":{"x":116,"y":785,"width":743,"height":12}},{"id":"c427d4b8-49c6-4cc4-b070-2ebd75415e28","block_type":"box","text":"demand for the ETN, volatility and lack of liquidity in underlying markets, changes in the applicable","page_number":119,"box":{"x":116,"y":800,"width":731,"height":12}},{"id":"bc4e69df-e1b8-4c89-83a5-8f3c5451dcf5","block_type":"box","text":"interest rates, the performance of the reference instrument, changes in the issuer’s credit rating and","page_number":119,"box":{"x":117,"y":816,"width":739,"height":12}},{"id":"92843135-1b73-4cfa-a3df-566d5e27d6ff","block_type":"box","text":"economic, legal, political or geographic events that affect the reference instrument. ETNs are subject to","page_number":119,"box":{"x":116,"y":831,"width":772,"height":12}},{"id":"b951bc33-2c5c-45c5-897a-5b42fc026e31","block_type":"box","text":"credit risk and the value of the ETN may drop due to a downgrade in an issuer’s credit rating, despite","page_number":119,"box":{"x":116,"y":847,"width":755,"height":12}},{"id":"fab0a4ba-1fda-45af-bf10-e71940446e4d","block_type":"box","text":"the underlying reference instrument remaining unchanged. When a Fund invests in ETNs, it will bear","page_number":119,"box":{"x":116,"y":862,"width":752,"height":12}},{"id":"148812b0-a57e-400c-a033-5212ac8c944b","block_type":"box","text":"its proportionate share of any fees and expenses borne by the ETN.","page_number":119,"box":{"x":117,"y":878,"width":509,"height":12}},{"id":"ace52201-af6e-4723-aa79-a975bac100e1","block_type":"box","text":"II-35","page_number":119,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"c0eb6ff4-525c-4b25-8b2c-8af7ad4b6aa8","block_type":"box","text":"NM0926U-5926888-119/257","page_number":119,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"45a1c11d-ea88-4714-9af0-4df5cc362ea7","block_type":"box","text":"An ETN that is tied to a reference instrument may not replicate the performance of the reference","page_number":120,"box":{"x":116,"y":87,"width":720,"height":12}},{"id":"deaa90b4-63b4-46ff-b828-debc9e4f4a3e","block_type":"box","text":"instrument. ETNs also incur certain expenses not incurred by their applicable reference instrument.","page_number":120,"box":{"x":117,"y":102,"width":740,"height":13}},{"id":"0fe9c101-5227-495f-b355-a4e5be5702f1","block_type":"box","text":"Some ETNs that use leverage may, at times, be illiquid and","page_number":120,"box":{"x":116,"y":118,"width":446,"height":12}},{"id":"f84c1276-e183-4d6c-ae2b-d82723404a29","block_type":"box","text":"may be difficult to purchase or sell at a fair","page_number":120,"box":{"x":563,"y":118,"width":319,"height":12}},{"id":"924e9ba7-f38a-4e25-92ba-aa7b23cc4b11","block_type":"box","text":"price. Levered ETNs are subject to the same risk as other instruments that use leverage in any form.","page_number":120,"box":{"x":117,"y":134,"width":751,"height":12}},{"id":"efa4386a-c77a-4afc-b805-23e2e509e0d7","block_type":"box","text":"While leverage allows for greater potential return, the potential for loss is also greater. 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The market value of ETN shares may differ from the","page_number":120,"box":{"x":116,"y":241,"width":744,"height":12}},{"id":"fa67cb76-6f30-4574-bae1-9edd6475bf1f","block_type":"box","text":"value of the reference instrument. This difference in price may be due to the fact that the supply and","page_number":120,"box":{"x":116,"y":257,"width":748,"height":12}},{"id":"c52739e0-7262-4a82-864e-4bc7f5d4f9fe","block_type":"box","text":"demand in the market for ETN shares at any point in time is not always identical to the supply and","page_number":120,"box":{"x":116,"y":272,"width":732,"height":12}},{"id":"8c64d1da-0ad1-40aa-a6fd-49bf7f48d266","block_type":"box","text":"demand in the market for the assets underlying the reference instrument that the ETN seeks to track.","page_number":120,"box":{"x":116,"y":288,"width":755,"height":12}},{"id":"a47b3dd7-25e0-426b-aef4-7203d0d8623c","block_type":"box","text":"There may be restrictions on the Fund’s right to redeem its investment in an ETN, which are generally","page_number":120,"box":{"x":116,"y":318,"width":761,"height":12}},{"id":"2da955a9-ea74-4d02-95e9-11697c2962fc","block_type":"box","text":"meant to be held until maturity. The Fund’s decision to sell its ETN holdings may be limited by the","page_number":120,"box":{"x":117,"y":333,"width":728,"height":12}},{"id":"b9401788-5d69-4169-8370-605607bc2fdd","block_type":"box","text":"availability of a secondary market. An investor in an ETN could lose some or all of the amount","page_number":120,"box":{"x":116,"y":349,"width":701,"height":12}},{"id":"be8794e0-c153-4627-80b6-39381af344c3","block_type":"box","text":"invested.","page_number":120,"box":{"x":117,"y":364,"width":71,"height":10}},{"id":"a6738af2-4382-425b-90f0-e8bcdb090b8b","block_type":"box","text":"ETNs are also subject to tax risks. The Internal Revenue Service (the “IRS”) may not accept, and a","page_number":120,"box":{"x":117,"y":394,"width":739,"height":12}},{"id":"d358a7a6-cfe4-4433-bf35-16a7961ad83b","block_type":"box","text":"court may not uphold, how the Funds characterize and treat ETNs for tax purposes. The timing and","page_number":120,"box":{"x":116,"y":410,"width":742,"height":12}},{"id":"36bac249-d178-4ef9-8f8a-1ded8d5b113e","block_type":"box","text":"character of income and gains derived by a Fund from investments in ETNs may be affected by future","page_number":120,"box":{"x":116,"y":425,"width":762,"height":12}},{"id":"8b6d6466-1ab2-4189-b61c-d7f8a5b9e036","block_type":"box","text":"legislation.","page_number":120,"box":{"x":117,"y":441,"width":83,"height":12}},{"id":"0493db27-6aab-482f-9dd4-7d09587b34ba","block_type":"box","text":"Foreign Investments.","page_number":120,"box":{"x":116,"y":471,"width":174,"height":12}},{"id":"ea64c27d-9333-4ba3-88e3-b8db6b779a47","block_type":"box","text":"Foreign Investment Risks.","page_number":120,"box":{"x":116,"y":494,"width":193,"height":12}},{"id":"fffb7d5f-c273-4e2e-8748-de67352095eb","block_type":"box","text":"Certain Funds may invest in foreign securities, including securities from","page_number":120,"box":{"x":310,"y":493,"width":540,"height":13}},{"id":"b3073658-8725-48c9-bfac-bb79b7cf9fb0","block_type":"box","text":"issuers located in emerging market countries. These securities may be denominated in U.S. dollars or","page_number":120,"box":{"x":117,"y":509,"width":760,"height":12}},{"id":"76b0399e-df71-4d02-8800-a99de2478b6f","block_type":"box","text":"in a foreign currency. Investing in foreign securities involves risks not typically associated with investing","page_number":120,"box":{"x":117,"y":524,"width":770,"height":13}},{"id":"65e54e83-86a5-401b-ae5a-8362fd1e2e02","block_type":"box","text":"in securities of companies organized and operated in the United States that can increase the chances","page_number":120,"box":{"x":117,"y":540,"width":759,"height":12}},{"id":"21e3a15c-cc0c-4517-8d3a-1a82bf88614e","block_type":"box","text":"that a Fund will lose money.","page_number":120,"box":{"x":116,"y":556,"width":213,"height":12}},{"id":"790943c6-3b38-4127-9219-1ee5add1c203","block_type":"box","text":"Securities issued by certain companies organized outside the United States may not be deemed to be","page_number":120,"box":{"x":116,"y":586,"width":762,"height":12}},{"id":"a6c49be2-dadd-4e60-a2d5-2fa2607987d5","block_type":"box","text":"foreign securities (but rather deemed to be U.S. securities) if (i) the company’s principal operations are","page_number":120,"box":{"x":116,"y":601,"width":766,"height":12}},{"id":"5355381b-b364-4ae2-8f7e-378485156b47","block_type":"box","text":"conducted from the U.S., (ii) the company’s equity securities trade principally on a U.S. stock","page_number":120,"box":{"x":116,"y":617,"width":694,"height":12}},{"id":"b82b6b5d-4d06-4cc7-aeda-b2ad55ed15b7","block_type":"box","text":"exchange, (iii) the company does a substantial amount of business in the U.S. or (iv) the issuer of","page_number":120,"box":{"x":116,"y":632,"width":729,"height":12}},{"id":"984367d2-1ae8-4313-acb0-33383b51b935","block_type":"box","text":"securities is included in the Fund’s primary U.S. benchmark index.","page_number":120,"box":{"x":116,"y":648,"width":496,"height":12}},{"id":"6a28c10b-642a-412f-a866-0e9e47d80f9a","block_type":"box","text":"In addition to equity securities, foreign investments of the Funds may include: (a) debt obligations","page_number":120,"box":{"x":117,"y":678,"width":721,"height":12}},{"id":"4b543bef-b152-4663-8af1-f96209e3fa8b","block_type":"box","text":"issued or guaranteed by foreign sovereign governments or their agencies, authorities, instrumentalities","page_number":120,"box":{"x":117,"y":693,"width":762,"height":12}},{"id":"d77a8a22-63b9-4351-b123-bb6669580128","block_type":"box","text":"or political subdivisions, including a foreign state, province or municipality; (b) debt obligations of","page_number":120,"box":{"x":116,"y":709,"width":716,"height":12}},{"id":"30dd773f-76cc-47ff-8afd-7d8f92b3bf52","block_type":"box","text":"supranational organizations; (c) debt obligations of foreign banks and bank holding companies;","page_number":120,"box":{"x":116,"y":724,"width":703,"height":12}},{"id":"1f330071-fc54-43b3-97d5-6e21cf8e6c2f","block_type":"box","text":"(d) debt obligations of domestic banks and corporations issued in foreign currencies; (e) debt","page_number":120,"box":{"x":117,"y":740,"width":689,"height":12}},{"id":"197a77af-56b8-46f3-a229-c01e0b55c19c","block_type":"box","text":"obligations denominated in the Euro; and (f) foreign corporate debt securities and commercial paper.","page_number":120,"box":{"x":116,"y":755,"width":746,"height":12}},{"id":"e58a7566-5021-484b-99dc-ede621a95189","block_type":"box","text":"Such securities may include loan participations and assignments, convertible securities and","page_number":120,"box":{"x":116,"y":771,"width":678,"height":12}},{"id":"f1364c29-64b1-4836-9ed6-7f4cc01d7d97","block_type":"box","text":"zero-coupon securities.","page_number":120,"box":{"x":116,"y":786,"width":172,"height":12}},{"id":"3c5b2c8f-2d35-43ba-a388-616a0e359c5c","block_type":"box","text":"Dividends or interest on, or proceeds from the sale of, foreign securities may be subject to foreign","page_number":120,"box":{"x":117,"y":816,"width":723,"height":12}},{"id":"6dec8e42-86cd-4150-978a-efd208f61ced","block_type":"box","text":"withholding taxes.","page_number":120,"box":{"x":116,"y":832,"width":138,"height":12}},{"id":"cc9b9ba4-c64e-441c-bc48-072342acf7b5","block_type":"box","text":"To the extent that the underlying securities or other instruments held by a Fund trade on foreign","page_number":120,"box":{"x":116,"y":862,"width":715,"height":12}},{"id":"0c697de0-df04-4fa6-9134-8cb846d31a45","block_type":"box","text":"exchanges or in foreign markets that are closed when the securities exchange on which the Fund’s","page_number":120,"box":{"x":116,"y":877,"width":740,"height":12}},{"id":"d7026094-bf2c-4db1-afa1-e37165e02def","block_type":"box","text":"II-36","page_number":120,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"d21e8631-65ad-454a-b04a-aa08c7d9624c","block_type":"box","text":"NM0926U-5926888-120/257","page_number":120,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"23a1ee3d-edec-4806-b33b-6f7caa1ff0d9","block_type":"box","text":"shares trade is open, there are likely to be deviations between the current price of such an underlying","page_number":121,"box":{"x":116,"y":87,"width":758,"height":12}},{"id":"c293c096-c67b-4cb9-b0c8-645168ea7afc","block_type":"box","text":"security and the last quoted price for the underlying security (","page_number":121,"box":{"x":116,"y":102,"width":454,"height":13}},{"id":"1b4ce298-f2d5-4294-8aab-13b2c48b1fa1","block_type":"box","text":"i.e.","page_number":121,"box":{"x":571,"y":103,"width":20,"height":9}},{"id":"6efbf813-8128-4d7f-b513-34aca05e731a","block_type":"box","text":", the Fund’s quote from the closed","page_number":121,"box":{"x":594,"y":102,"width":258,"height":12}},{"id":"55fd7edf-4323-450b-a6fd-a85033d0c92f","block_type":"box","text":"foreign market). The impact of a closed foreign market on a Fund is likely to be greater where a large","page_number":121,"box":{"x":116,"y":118,"width":755,"height":12}},{"id":"e0ab9bfe-f81f-4319-81e5-411ffc4c8424","block_type":"box","text":"portion of the Fund’s underlying securities or other instruments trade on that closed foreign market or","page_number":121,"box":{"x":117,"y":134,"width":754,"height":12}},{"id":"048537d8-a0fd-4dbc-a70d-80b1016498d8","block_type":"box","text":"when the foreign market is closed for unscheduled reasons. These deviations may result in premiums","page_number":121,"box":{"x":116,"y":149,"width":759,"height":12}},{"id":"546c0daf-9afc-4409-b977-5f7082a4e2fc","block_type":"box","text":"or discounts to certain Funds’ NAVs that may be greater than those experienced by other ETFs.","page_number":121,"box":{"x":116,"y":165,"width":718,"height":12}},{"id":"69a9f619-5e42-4f76-9a0b-35e8f42db2e0","block_type":"box","text":"Foreign Market Risk.","page_number":121,"box":{"x":116,"y":196,"width":152,"height":12}},{"id":"ec6684ed-4edc-46d2-a1b9-fdf58b14ab9e","block_type":"box","text":"Funds that may invest in foreign securities offer the potential for more","page_number":121,"box":{"x":269,"y":196,"width":521,"height":12}},{"id":"2b72ad5e-9258-43a4-b057-1fbac5137569","block_type":"box","text":"diversification than a Fund that invests only in the United States because securities traded on foreign","page_number":121,"box":{"x":116,"y":211,"width":746,"height":12}},{"id":"c3ef5a5f-2228-40b3-90d4-ff624e28cdbd","block_type":"box","text":"markets have often (though not always) performed differently from securities traded in the United","page_number":121,"box":{"x":117,"y":227,"width":715,"height":12}},{"id":"5245735a-df65-4598-80db-8174b9c5b892","block_type":"box","text":"States. However, such investments often involve risks not present in U.S. investments that can increase","page_number":121,"box":{"x":116,"y":242,"width":769,"height":12}},{"id":"6729a693-8f25-4a7e-a3d0-b0a56775b7c4","block_type":"box","text":"the chances that a Fund will lose money. In particular, a Fund is subject to the risk that, because there","page_number":121,"box":{"x":116,"y":258,"width":756,"height":12}},{"id":"a674c881-b524-4ac1-b0e0-e56936e05407","block_type":"box","text":"are generally fewer investors on foreign exchanges and a smaller number of shares traded each day, it","page_number":121,"box":{"x":116,"y":273,"width":762,"height":12}},{"id":"e298248e-1b3f-4308-8ae6-ae06d2561bd9","block_type":"box","text":"may be difficult for the Fund to buy and sell securities on those exchanges. In addition, prices of foreign","page_number":121,"box":{"x":117,"y":289,"width":763,"height":12}},{"id":"bc3e56a9-4e53-468d-b398-b47d5f061314","block_type":"box","text":"securities may fluctuate more than prices of securities traded in the United States. Investments in","page_number":121,"box":{"x":116,"y":304,"width":719,"height":12}},{"id":"4041f00c-e9d8-4bb2-b47e-ba3e5907ca72","block_type":"box","text":"foreign markets may also be adversely affected by governmental actions such as the imposition of","page_number":121,"box":{"x":116,"y":320,"width":727,"height":12}},{"id":"f5f7636d-aa89-4f26-a985-cce934d99b0d","block_type":"box","text":"punitive taxes or tariffs. In addition, economic conditions, such as volatile currency exchange rates and","page_number":121,"box":{"x":117,"y":335,"width":759,"height":12}},{"id":"90422dfe-5b87-4f7b-a990-1213b1545682","block_type":"box","text":"interest rates, political events, military action and other conditions may, without prior warning, lead to the","page_number":121,"box":{"x":117,"y":351,"width":770,"height":12}},{"id":"93df730c-246c-458e-a500-848fc7cd4002","block_type":"box","text":"governments of certain countries, or the U.S. Government with respect to certain countries, prohibiting","page_number":121,"box":{"x":116,"y":366,"width":756,"height":12}},{"id":"4ffa2884-eff4-4a00-b887-43bc86e2a68f","block_type":"box","text":"or imposing substantial restrictions through capital controls and/or sanctions on foreign investing in the","page_number":121,"box":{"x":116,"y":382,"width":758,"height":12}},{"id":"7d4b1fec-7334-499f-b574-a43a1f360f73","block_type":"box","text":"capital markets or certain industries in those countries. Capital controls and/or sanctions may include","page_number":121,"box":{"x":116,"y":397,"width":746,"height":12}},{"id":"c7391599-cd6c-45be-90ca-88f4b7738a95","block_type":"box","text":"the prohibition of, or restrictions on, the ability to own or transfer currency, securities, derivatives or","page_number":121,"box":{"x":116,"y":413,"width":730,"height":12}},{"id":"7df83380-e343-4a1d-9309-abb36465b7c7","block_type":"box","text":"other assets and may also include retaliatory actions of one government against another government,","page_number":121,"box":{"x":116,"y":428,"width":752,"height":12}},{"id":"6712fd31-8bab-41d4-af85-1f9c3aa6b285","block_type":"box","text":"such as seizure of assets. Any of these actions could severely impair a Fund’s ability to purchase, sell,","page_number":121,"box":{"x":116,"y":444,"width":758,"height":12}},{"id":"e69a1a73-ffc4-43df-a21d-c44da4965b43","block_type":"box","text":"transfer, receive, deliver or otherwise obtain exposure to foreign securities and assets, including the","page_number":121,"box":{"x":116,"y":459,"width":738,"height":12}},{"id":"4429238b-bd12-46be-8af5-a6d2e2716a13","block_type":"box","text":"ability to transfer the Fund’s assets or income back into the United States, and could negatively impact","page_number":121,"box":{"x":116,"y":475,"width":758,"height":12}},{"id":"5aaa5848-8057-456d-a8c3-2d08e8da3ec5","block_type":"box","text":"the value and/or liquidity of such assets or otherwise adversely affect a Fund’s operations, causing the","page_number":121,"box":{"x":116,"y":490,"width":757,"height":12}},{"id":"895bfe84-d8f7-4db1-88fd-5980b89ea1f8","block_type":"box","text":"Fund to decline in value. Other potential foreign market risks include exchange controls, difficulties in","page_number":121,"box":{"x":117,"y":506,"width":745,"height":12}},{"id":"d9d9c44b-a3b7-4298-980b-e7afa5dac8da","block_type":"box","text":"pricing securities, defaults on foreign government securities, difficulties in enforcing favorable legal","page_number":121,"box":{"x":117,"y":521,"width":727,"height":12}},{"id":"18d6d140-205c-4bd1-b0e7-8aa4326f553a","block_type":"box","text":"judgments in foreign courts, and political and social conditions, such as diplomatic relations,","page_number":121,"box":{"x":115,"y":537,"width":680,"height":12}},{"id":"f0ac780d-d293-4c17-aa13-ff61f0db962f","block_type":"box","text":"confiscatory taxation, expropriation, limitation on the removal of funds or assets, or imposition of (or","page_number":121,"box":{"x":116,"y":552,"width":735,"height":12}},{"id":"86984b3f-b9ce-46fa-a094-976d269900ec","block_type":"box","text":"change in) exchange control regulations. Legal remedies available to investors in certain foreign","page_number":121,"box":{"x":116,"y":568,"width":711,"height":12}},{"id":"71ea3b02-9370-4689-bc5e-03ca4dfca150","block_type":"box","text":"countries may be less extensive than those available to investors in the United States or other foreign","page_number":121,"box":{"x":116,"y":583,"width":751,"height":12}},{"id":"a2165bf3-ca3c-4b0d-b354-ee8a672aaa60","block_type":"box","text":"countries. In addition, changes in government administrations or economic or monetary policies in the","page_number":121,"box":{"x":116,"y":599,"width":752,"height":12}},{"id":"878eda27-df9b-4b90-b8a7-2a924ea04e87","block_type":"box","text":"United States or abroad could result in appreciation or depreciation of portfolio securities and could","page_number":121,"box":{"x":117,"y":614,"width":731,"height":12}},{"id":"dd5f44d0-079a-4e08-9f3f-5876511cb845","block_type":"box","text":"favorably or adversely affect a Fund’s operations.","page_number":121,"box":{"x":116,"y":630,"width":368,"height":12}},{"id":"5deaa5ca-c097-4108-bb35-27609d7abc8f","block_type":"box","text":"Foreign Economy Risk.","page_number":121,"box":{"x":116,"y":661,"width":172,"height":12}},{"id":"404b90f7-60df-4223-a46b-c94d8cfa609b","block_type":"box","text":"The economies of certain foreign markets often do not compare favorably with","page_number":121,"box":{"x":295,"y":661,"width":579,"height":12}},{"id":"633fb8db-5092-4ad0-b02b-fbff54b9f075","block_type":"box","text":"that of the United States with respect to such issues as growth of gross national product, reinvestment","page_number":121,"box":{"x":116,"y":676,"width":759,"height":12}},{"id":"cbc59252-d6f1-4e15-a8f6-413e9ccd443e","block_type":"box","text":"of capital, resources, and balance of payments position. Certain such economies may rely heavily on","page_number":121,"box":{"x":116,"y":692,"width":748,"height":12}},{"id":"e9e48cc9-9497-4c18-ac5f-fb4ab9a9cfa0","block_type":"box","text":"particular industries or foreign capital and are more vulnerable to diplomatic developments, the","page_number":121,"box":{"x":117,"y":707,"width":702,"height":12}},{"id":"30172341-bfaf-4f2c-98e9-1f23b01a5a15","block_type":"box","text":"imposition of economic sanctions against a particular country or countries, changes in international","page_number":121,"box":{"x":117,"y":723,"width":731,"height":12}},{"id":"f8f76869-e97d-4587-9af4-a66a44cc73e4","block_type":"box","text":"trading patterns, trade barriers, and other protectionist or retaliatory measures.","page_number":121,"box":{"x":116,"y":738,"width":582,"height":12}},{"id":"28fb1715-575f-4c89-a673-d0ec03ee5455","block_type":"box","text":"Currency Risk and Exchange Risk.","page_number":121,"box":{"x":117,"y":769,"width":257,"height":12}},{"id":"e0cb67c7-046d-4418-a0d3-a2350644f67e","block_type":"box","text":"Because foreign securities generally are denominated and pay","page_number":121,"box":{"x":382,"y":769,"width":464,"height":12}},{"id":"47ba231b-11ac-4e15-b6a5-056a0d5938ea","block_type":"box","text":"dividends or interest in foreign currencies, the value of a Fund that invests in foreign securities as","page_number":121,"box":{"x":116,"y":785,"width":721,"height":12}},{"id":"6cd250d9-c172-49ba-8467-e54016496c06","block_type":"box","text":"measured in U.S. dollars will be affected favorably or unfavorably by changes in exchange rates.","page_number":121,"box":{"x":117,"y":800,"width":715,"height":12}},{"id":"5c6c1e2d-ed99-48c2-936b-e8a90ec0e1e5","block_type":"box","text":"Generally, when the U.S. dollar rises in value against a foreign currency, a security denominated in","page_number":121,"box":{"x":117,"y":816,"width":733,"height":12}},{"id":"4ade46f3-9c70-4518-8ce8-cdfc0d511a4e","block_type":"box","text":"that currency loses value because the currency is worth fewer U.S. dollars. Conversely, when the U.S.","page_number":121,"box":{"x":116,"y":831,"width":765,"height":12}},{"id":"949b9cb7-be62-4719-aced-0a77a7948895","block_type":"box","text":"dollar decreases in value against a foreign currency, a security denominated in that currency gains","page_number":121,"box":{"x":116,"y":847,"width":737,"height":12}},{"id":"b2765b99-0332-440a-bd73-7674d0ee15f1","block_type":"box","text":"value because the currency is worth more U.S. dollars. This risk, generally known as “currency risk,”","page_number":121,"box":{"x":116,"y":862,"width":749,"height":12}},{"id":"07170260-5b37-4412-ae6f-d01657583c43","block_type":"box","text":"means that a stronger U.S. dollar will reduce returns for U.S. investors while a weak U.S. dollar will","page_number":121,"box":{"x":117,"y":878,"width":738,"height":12}},{"id":"e2ce13fe-5f01-44b8-b7b0-0586031ecb21","block_type":"box","text":"II-37","page_number":121,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"918fe9b8-3cc5-46f0-b819-5540a878bce0","block_type":"box","text":"NM0926U-5926888-121/257","page_number":121,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"4e44cf70-70a8-44b3-b9cf-9a227b6e950c","block_type":"box","text":"increase those returns. Currency exchange rates can also be affected unpredictably by intervention by","page_number":122,"box":{"x":117,"y":87,"width":764,"height":12}},{"id":"94a2b9c0-5cde-40e3-92b7-33bd8702a3dc","block_type":"box","text":"U.S. or foreign governments or central banks, or the failure to intervene, or buy currency controls or","page_number":122,"box":{"x":117,"y":102,"width":743,"height":13}},{"id":"7de2f21e-a4e0-43fd-b4e5-ca3114326325","block_type":"box","text":"political developments in the United States or abroad.","page_number":122,"box":{"x":117,"y":118,"width":402,"height":12}},{"id":"6b6118e1-b850-4962-82ba-43c57a5dc861","block_type":"box","text":"Governmental Supervision and Regulation/Accounting Standards. Many foreign governments","page_number":122,"box":{"x":117,"y":149,"width":697,"height":12}},{"id":"3ec84839-5b95-4065-a2c2-bc8d7fba4526","block_type":"box","text":"supervise and regulate stock exchanges, brokers and the sale of securities less than does the United","page_number":122,"box":{"x":116,"y":165,"width":756,"height":12}},{"id":"5f5833bc-cf25-473d-b3e0-1494a0ff0c2d","block_type":"box","text":"States. Some countries may not have laws to protect investors comparable to the U.S. securities laws.","page_number":122,"box":{"x":116,"y":180,"width":765,"height":12}},{"id":"cd9db1c6-88fa-4fa2-ae27-53a14a347932","block_type":"box","text":"For example, some foreign countries may have no laws or rules against insider trading. Insider trading","page_number":122,"box":{"x":117,"y":196,"width":762,"height":12}},{"id":"d1a576f8-2167-4d28-b41c-3855372abc46","block_type":"box","text":"occurs when a person buys or sells a company’s securities based on nonpublic information about that","page_number":122,"box":{"x":116,"y":211,"width":760,"height":12}},{"id":"13b50d6c-fe0e-4afb-8938-b923268ed0ae","block_type":"box","text":"company. Accounting standards in other countries are not necessarily the same as in the United","page_number":122,"box":{"x":116,"y":227,"width":719,"height":12}},{"id":"bb4db333-494e-4945-921d-5c1abb987440","block_type":"box","text":"States. If the accounting standards in another country do not require as much detail as U.S. accounting","page_number":122,"box":{"x":116,"y":242,"width":771,"height":12}},{"id":"00e5d77b-e587-40d5-a6a3-57ea0fcb69e9","block_type":"box","text":"standards, it may be harder for Fund management to completely and accurately determine a","page_number":122,"box":{"x":116,"y":258,"width":691,"height":12}},{"id":"05a9152b-d164-4777-8cc7-505fd80677a7","block_type":"box","text":"company’s financial condition. In addition, the U.S. Government has from time to time in the past","page_number":122,"box":{"x":116,"y":273,"width":722,"height":12}},{"id":"c4bb54ca-1dc6-4461-be98-2c8c63df176b","block_type":"box","text":"imposed restrictions, through penalties and otherwise, on foreign investments by U.S. investors such","page_number":122,"box":{"x":117,"y":289,"width":752,"height":12}},{"id":"34f82b30-e256-4363-8027-571a7a23fe8e","block_type":"box","text":"as the Fund. If such restrictions should be reinstituted, it might become necessary for the Fund to","page_number":122,"box":{"x":116,"y":304,"width":727,"height":12}},{"id":"318ce8de-186c-46fc-8276-29e918102dcc","block_type":"box","text":"invest all or substantially all of its assets in U.S. securities. Also, brokerage commissions and other","page_number":122,"box":{"x":117,"y":320,"width":737,"height":12}},{"id":"3c5d021e-2401-4cc5-a9a5-566aa4bcbb7f","block_type":"box","text":"costs of buying or selling securities often are higher in foreign countries than they are in the United","page_number":122,"box":{"x":116,"y":335,"width":736,"height":12}},{"id":"7610e13c-4933-40b6-8815-ff4792148999","block_type":"box","text":"States. This reduces the amount the Fund can earn on its investments.","page_number":122,"box":{"x":116,"y":351,"width":532,"height":9}},{"id":"b1a7ca8b-af4b-41f1-b564-dc8aec2476f2","block_type":"box","text":"Certain Risks of Holding Fund Assets Outside the United States.","page_number":122,"box":{"x":117,"y":382,"width":477,"height":12}},{"id":"25f7f526-100d-447a-a7e2-41e54ba41f84","block_type":"box","text":"A Fund generally holds its foreign","page_number":122,"box":{"x":596,"y":382,"width":259,"height":12}},{"id":"08ca7293-5892-48b1-9513-dea899f6c5d5","block_type":"box","text":"securities and cash in foreign banks and securities depositories. Some foreign banks and securities","page_number":122,"box":{"x":116,"y":397,"width":743,"height":12}},{"id":"6c6d57a4-7c1a-48ce-b2a7-5f1cf30a639e","block_type":"box","text":"depositories may be recently organized or new to the foreign custody business. In addition, there may","page_number":122,"box":{"x":116,"y":413,"width":760,"height":12}},{"id":"87568046-9f80-445a-907a-6e393a00f6be","block_type":"box","text":"be limited or no regulatory oversight over their operations. Also, the laws of certain countries may put","page_number":122,"box":{"x":117,"y":428,"width":754,"height":12}},{"id":"574956ab-111d-4aa4-8ede-9a179fa01f48","block_type":"box","text":"limits on a Fund’s ability to recover its assets if a foreign bank or depository or issuer of a security or","page_number":122,"box":{"x":117,"y":444,"width":747,"height":12}},{"id":"1163e911-4ac3-4406-b5ee-7c7f5aa393ee","block_type":"box","text":"any of their agents goes bankrupt. In addition, it is often more expensive for a Fund to buy, sell and","page_number":122,"box":{"x":116,"y":459,"width":741,"height":12}},{"id":"1b342f78-d2ae-439b-82e5-a60fa24487bc","block_type":"box","text":"hold securities in certain foreign markets than in the United States. The increased expense of investing","page_number":122,"box":{"x":117,"y":475,"width":768,"height":12}},{"id":"35177494-3da8-46fc-9039-e839374e7eda","block_type":"box","text":"in foreign markets reduces the amount a Fund can earn on its investments and typically results in a","page_number":122,"box":{"x":117,"y":490,"width":741,"height":12}},{"id":"be053831-e5de-49eb-8a1a-81a60e20980a","block_type":"box","text":"higher operating expense ratio for the Fund as compared to investment companies that invest only in","page_number":122,"box":{"x":117,"y":506,"width":754,"height":12}},{"id":"d42d6e50-200b-4a6d-99d1-87f102ea0474","block_type":"box","text":"the United States.","page_number":122,"box":{"x":116,"y":521,"width":138,"height":10}},{"id":"9d1c4c14-fb42-443a-941b-a9c03ac266bf","block_type":"box","text":"Publicly Available Information.","page_number":122,"box":{"x":116,"y":552,"width":222,"height":12}},{"id":"227a6cc1-42b1-445c-b6d0-e9e47c0cca4c","block_type":"box","text":"In general, less information is publicly available with respect to foreign","page_number":122,"box":{"x":340,"y":552,"width":529,"height":12}},{"id":"8baa7016-ad81-4df4-84c7-7ffba1da4954","block_type":"box","text":"issuers than is available with respect to U.S. companies. Most foreign companies are also not subject","page_number":122,"box":{"x":117,"y":568,"width":758,"height":12}},{"id":"5817ab5f-d5d9-46b1-a5d3-3fc46c6a7595","block_type":"box","text":"to the uniform accounting and financial reporting requirements applicable to issuers in the United","page_number":122,"box":{"x":116,"y":583,"width":723,"height":12}},{"id":"812d011a-ef39-4129-882c-73a8aa2fcba7","block_type":"box","text":"States. While the volume of transactions effected on foreign stock exchanges has increased in recent","page_number":122,"box":{"x":116,"y":599,"width":758,"height":12}},{"id":"e9bcd750-d7bd-4f26-a98d-10dd9064e01c","block_type":"box","text":"years, it remains appreciably below that of the New York Stock Exchange. Accordingly, a Fund’s","page_number":122,"box":{"x":116,"y":614,"width":721,"height":12}},{"id":"073607f9-cc61-4afa-9ad4-78259e077bba","block_type":"box","text":"foreign investments may be less liquid than, and their prices may be more volatile than, comparable","page_number":122,"box":{"x":116,"y":630,"width":745,"height":12}},{"id":"c98d58a8-4f06-4b75-a462-08a2bccd296b","block_type":"box","text":"investments in securities in U.S. companies. In addition, there is generally less government supervision","page_number":122,"box":{"x":117,"y":645,"width":771,"height":12}},{"id":"00df2e2f-a0e9-45e6-b162-b205cbf06a9d","block_type":"box","text":"and regulation of securities exchanges, brokers and issuers in foreign countries than in the United","page_number":122,"box":{"x":116,"y":661,"width":726,"height":12}},{"id":"5f2031c4-70b2-4db8-b64e-bd9e32072525","block_type":"box","text":"States.","page_number":122,"box":{"x":116,"y":676,"width":51,"height":10}},{"id":"1e6066f4-bbbc-4cd7-9c0e-606a4cc51020","block_type":"box","text":"Settlement Risk.","page_number":122,"box":{"x":117,"y":707,"width":120,"height":10}},{"id":"4585b751-3ddb-4ea4-89d6-426d4398629a","block_type":"box","text":"Settlement and clearance procedures in certain foreign markets differ significantly","page_number":122,"box":{"x":244,"y":707,"width":606,"height":12}},{"id":"5ae68519-09b0-4917-8a23-cc69fe3dc029","block_type":"box","text":"from those in the United States. Supervisory authorities may also be unable to apply standards which","page_number":122,"box":{"x":116,"y":723,"width":751,"height":12}},{"id":"ea01886d-b63d-47ca-9241-e99ae6dc4b35","block_type":"box","text":"are comparable with those in the United States. Foreign settlement procedures and trade regulations","page_number":122,"box":{"x":116,"y":738,"width":749,"height":12}},{"id":"8b835c43-525f-437a-9b55-8f1db86c3f41","block_type":"box","text":"also may involve certain risks (such as delays in payment for or delivery of securities) not typically","page_number":122,"box":{"x":116,"y":754,"width":727,"height":12}},{"id":"8fe7af5b-e50e-4b03-a263-ea601d66de7d","block_type":"box","text":"generated by the settlement of U.S. investments.","page_number":122,"box":{"x":116,"y":769,"width":362,"height":12}},{"id":"e0059043-cac6-4d5f-9bf9-39a5041dc1b9","block_type":"box","text":"Communications between the United States and emerging market countries may be unreliable,","page_number":122,"box":{"x":117,"y":800,"width":704,"height":12}},{"id":"aafe723f-56ae-4678-ac10-2e64a74d0e88","block_type":"box","text":"increasing the risk of delayed settlements or losses of security certificates in markets that still rely on","page_number":122,"box":{"x":117,"y":816,"width":744,"height":12}},{"id":"b8f5ea14-8c91-4520-b761-c4e785e5c5c8","block_type":"box","text":"physical settlement. Settlements in certain foreign countries at times have not kept pace with the","page_number":122,"box":{"x":117,"y":831,"width":720,"height":12}},{"id":"4b350d9f-fae5-4ade-b182-4a5c49d785ce","block_type":"box","text":"number of securities transactions; these problems may make it difficult for a Fund to carry out","page_number":122,"box":{"x":117,"y":847,"width":698,"height":12}},{"id":"3ba2effc-26ba-4b51-a13f-d2980e1a10ab","block_type":"box","text":"transactions. If a Fund cannot settle or is delayed in settling a purchase of securities, it may miss","page_number":122,"box":{"x":116,"y":862,"width":723,"height":12}},{"id":"f459589f-efc9-470b-8055-11fae5681cb8","block_type":"box","text":"attractive investment opportunities and certain of its assets may be uninvested with no return earned","page_number":122,"box":{"x":116,"y":878,"width":751,"height":12}},{"id":"15e175d5-bd2e-4790-b232-c5850b83b244","block_type":"box","text":"II-38","page_number":122,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"49851c4b-05f1-47ca-afaf-793a556a4e15","block_type":"box","text":"NM0926U-5926888-122/257","page_number":122,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"049ac69c-67fa-4c4e-a06e-59d2761771d5","block_type":"box","text":"thereon for some period. If a Fund cannot settle or is delayed in settling a sale of securities, it may lose","page_number":123,"box":{"x":116,"y":87,"width":769,"height":12}},{"id":"763029b8-4f42-4dbc-8aae-0a849a039397","block_type":"box","text":"money if the value of the security then declines or, if it has contracted to sell the security to another","page_number":123,"box":{"x":117,"y":102,"width":739,"height":13}},{"id":"b35db03a-70cf-414c-9441-75d4d9996847","block_type":"box","text":"party, the Fund could be liable to that party for any losses incurred.","page_number":123,"box":{"x":117,"y":118,"width":501,"height":12}},{"id":"5fb96be4-5dd3-4a80-96a1-1072face5c9a","block_type":"box","text":"Because of uncertainties in the operation of settlement systems in individual markets, competing","page_number":123,"box":{"x":117,"y":149,"width":720,"height":12}},{"id":"8accad12-a501-46c4-a02a-4fbe34db0f5f","block_type":"box","text":"claims may arise in respect of securities held by or to be transferred to a Fund. Compensation","page_number":123,"box":{"x":116,"y":165,"width":703,"height":12}},{"id":"0b3dfbb8-5f7c-4d9d-9cff-94223f42989a","block_type":"box","text":"schemes may not exist or may otherwise be limited or inadequate to meet the Fund’s claims in case of","page_number":123,"box":{"x":116,"y":180,"width":766,"height":12}},{"id":"525ff690-4ebc-426e-9dac-5baccc6c1cfb","block_type":"box","text":"such event.","page_number":123,"box":{"x":116,"y":196,"width":90,"height":9}},{"id":"eede17d9-29b6-4d3d-9c33-cabc82554218","block_type":"box","text":"Sovereign Debt.","page_number":123,"box":{"x":117,"y":227,"width":115,"height":12}},{"id":"91f51e90-6df4-4a72-9d70-931a2cc2bc31","block_type":"box","text":"Investment in sovereign debt can involv","page_number":123,"box":{"x":234,"y":227,"width":293,"height":12}},{"id":"ddd95753-1988-443f-b3af-e486707e5584","block_type":"box","text":"e a high degree of risk. The governmental entity","page_number":123,"box":{"x":527,"y":227,"width":353,"height":12}},{"id":"6d70c425-e086-4978-b869-a0193e4f479b","block_type":"box","text":"that controls the repayment of sovereign debt ma","page_number":123,"box":{"x":116,"y":242,"width":357,"height":12}},{"id":"1af23877-227e-41ed-a0cc-3f5dcd8d8ee6","block_type":"box","text":"y not be able or willing to repay the principal and/or","page_number":123,"box":{"x":474,"y":242,"width":375,"height":12}},{"id":"bf005130-ee13-4486-88e7-1a20672cfadc","block_type":"box","text":"interest when due in accordance with the terms of","page_number":123,"box":{"x":117,"y":258,"width":362,"height":9}},{"id":"cd90957e-02f6-45f7-aacc-d752dda96b2e","block_type":"box","text":"f such debt. A governmental entity’s willingness or","page_number":123,"box":{"x":478,"y":258,"width":364,"height":12}},{"id":"6b749836-9975-4827-9846-1da54116637f","block_type":"box","text":"ability to repay principal and interest due in a timely","page_number":123,"box":{"x":116,"y":273,"width":372,"height":12}},{"id":"910f75b0-510a-4f60-ba02-968d3d14fe97","block_type":"box","text":"y manner may be affected by, among other factors, its","page_number":123,"box":{"x":488,"y":273,"width":390,"height":12}},{"id":"615816c6-9f10-4a14-819e-a5c805f06470","block_type":"box","text":"cash flow situation, the extent of its foreign rese","page_number":123,"box":{"x":116,"y":289,"width":346,"height":12}},{"id":"bc370ca9-bc66-454c-890f-22221f509cd0","block_type":"box","text":"rves, the availability of sufficient foreign exchange on the","page_number":123,"box":{"x":463,"y":289,"width":415,"height":12}},{"id":"5e13b428-336d-4f70-b370-1aa3a4c0823e","block_type":"box","text":"date a payment is due, the relative size of the","page_number":123,"box":{"x":116,"y":304,"width":335,"height":12}},{"id":"d8aa518d-3d90-4502-9fec-309187ca33d3","block_type":"box","text":"debt service burden to the economy as a whole, the","page_number":123,"box":{"x":452,"y":304,"width":381,"height":12}},{"id":"fe274a08-9705-4bec-8c5e-a85128fa0d8e","block_type":"box","text":"governmental entity’s policy towards the Internati","page_number":123,"box":{"x":116,"y":320,"width":354,"height":12}},{"id":"669e1611-68b2-403d-8edd-e4f1c6e4efbe","block_type":"box","text":"onal Monetary Fund and the political constraints to","page_number":123,"box":{"x":472,"y":320,"width":372,"height":12}},{"id":"8e347479-0f94-4894-a7e7-126c200bd73f","block_type":"box","text":"which a governmental entity may be subject. Gove","page_number":123,"box":{"x":116,"y":335,"width":367,"height":12}},{"id":"518ce01a-789d-4f73-b239-cba3e85b3500","block_type":"box","text":"rnmental entities may also be dependent on expected","page_number":123,"box":{"x":485,"y":335,"width":395,"height":12}},{"id":"b8181df8-d05b-4a06-b662-f9f871bc8543","block_type":"box","text":"disbursements from foreign governments, multila","page_number":123,"box":{"x":116,"y":351,"width":355,"height":12}},{"id":"c8e3739e-d27e-4328-8f08-c1f73031c07f","block_type":"box","text":"teral agencies and others abroad to reduce principal","page_number":123,"box":{"x":472,"y":351,"width":384,"height":12}},{"id":"608d189f-de3c-4329-b618-8d13030424b8","block_type":"box","text":"and interest arrearages on their debt. The commitment","page_number":123,"box":{"x":116,"y":366,"width":398,"height":12}},{"id":"21af2d33-21ba-4005-8f37-87c4375d846f","block_type":"box","text":"t on the part of these governments, agencies and","page_number":123,"box":{"x":514,"y":366,"width":358,"height":12}},{"id":"6cd7369e-1c01-4465-ad9d-f1124e6e217c","block_type":"box","text":"others to make such disbursements may be condi","page_number":123,"box":{"x":116,"y":382,"width":362,"height":12}},{"id":"7d5af0b8-4789-4ea3-9c19-963eeb089dd9","block_type":"box","text":"tioned on the implementation of economic reforms and/","page_number":123,"box":{"x":479,"y":382,"width":402,"height":12}},{"id":"14ec7f27-7bad-4353-9466-e16f8ce094ea","block_type":"box","text":"or economic performance and the timely service of such","page_number":123,"box":{"x":116,"y":397,"width":407,"height":12}},{"id":"ab513e33-0335-4789-85cf-6e1cf1d7d741","block_type":"box","text":"debtor’s obligations. Failure to implement such","page_number":123,"box":{"x":524,"y":397,"width":349,"height":12}},{"id":"850b8a11-ad1b-41dc-ad21-fa575e1fa9fc","block_type":"box","text":"reforms, achieve such levels of economic performance","page_number":123,"box":{"x":117,"y":413,"width":402,"height":12}},{"id":"1d5fb91f-a992-4f2b-81b1-b3b3d129258d","block_type":"box","text":"or repay principal or interest when due may result","page_number":123,"box":{"x":519,"y":413,"width":365,"height":12}},{"id":"af54143b-843a-450a-bedc-09e9adfa8fcf","block_type":"box","text":"in the cancellation of such third parties’ commitments","page_number":123,"box":{"x":117,"y":428,"width":389,"height":12}},{"id":"7e455acd-f79e-45ca-b633-7faced591fc0","block_type":"box","text":"to lend funds to the governmental entity, which may","page_number":123,"box":{"x":506,"y":428,"width":380,"height":12}},{"id":"7fc4dda5-e447-4329-955f-d6b1dd73fb4d","block_type":"box","text":"further impair such debtor’s ability or willingness to t","page_number":123,"box":{"x":116,"y":444,"width":372,"height":12}},{"id":"4320c62f-0fb4-4721-ac34-0e669685415f","block_type":"box","text":"timely service its debts. Consequently, governmental","page_number":123,"box":{"x":487,"y":444,"width":389,"height":12}},{"id":"84305b6f-2f72-444d-98e8-3e8004eb8714","block_type":"box","text":"entities may default on their sovereign debt.","page_number":123,"box":{"x":116,"y":459,"width":323,"height":12}},{"id":"95e13568-21df-43c2-a01e-08fabb09c1c2","block_type":"box","text":"Holders of sovereign debt may be requested to participate in the rescheduling of such debt and to","page_number":123,"box":{"x":117,"y":490,"width":730,"height":12}},{"id":"0ae977de-9173-476f-8eb5-675b7c814226","block_type":"box","text":"extend further loans to governmental entities. In the event of a default by a governmental entity, there","page_number":123,"box":{"x":116,"y":506,"width":758,"height":12}},{"id":"d48a3b4f-a1f0-4f06-a201-404abb327cea","block_type":"box","text":"may be few or no effective legal remedies for collecting on such debt.","page_number":123,"box":{"x":117,"y":521,"width":519,"height":12}},{"id":"f7fe7cba-3424-41fc-90fe-a9632f894adf","block_type":"box","text":"Withholding Tax Reclaims Risk","page_number":123,"box":{"x":118,"y":552,"width":226,"height":12}},{"id":"5f52f4db-f7b6-4b45-b80b-ebda63aef67f","block_type":"box","text":". A Fund may file claims to recover foreign withholding taxes on dividend","page_number":123,"box":{"x":344,"y":552,"width":530,"height":12}},{"id":"b1d9e6b5-432c-44ab-a76a-28e2c72b52bf","block_type":"box","text":"and interest income (if any) received from issuers in","page_number":123,"box":{"x":116,"y":568,"width":381,"height":12}},{"id":"b8e1a4e4-f0bd-4bbb-b034-0ed3cf834c66","block_type":"box","text":"certain countries and capital gains on the disposition","page_number":123,"box":{"x":498,"y":568,"width":385,"height":12}},{"id":"4a3f5e39-45b4-4f22-bd68-12e2aeea2591","block_type":"box","text":"of stocks or securities where such withholding ta","page_number":123,"box":{"x":116,"y":583,"width":351,"height":12}},{"id":"15024b10-6b96-4189-b336-e11f02908e8e","block_type":"box","text":"x reclaim is possible. Whether or when a Fund will","page_number":123,"box":{"x":468,"y":583,"width":369,"height":12}},{"id":"1e912bba-ab06-4ea7-add2-c5bb82be162e","block_type":"box","text":"receive a withholding tax refund is within the control","page_number":123,"box":{"x":117,"y":599,"width":379,"height":12}},{"id":"a6bff4e2-378d-450d-8ef2-5303c885b79c","block_type":"box","text":"of the tax authorities in such countries. Where a","page_number":123,"box":{"x":496,"y":599,"width":352,"height":9}},{"id":"3b2b5b13-f05c-415f-a12a-db76b0344c43","block_type":"box","text":"Fund expects to recover withholding taxes, the net asset value of the Fund generally includes accruals","page_number":123,"box":{"x":117,"y":614,"width":748,"height":12}},{"id":"bd3ca300-a947-4e12-a65f-e36da750b34c","block_type":"box","text":"for such tax refunds. Each Fund regularly evaluates","page_number":123,"box":{"x":116,"y":630,"width":375,"height":12}},{"id":"3c53eb56-1bb5-4198-8938-dd32f2d5bcaa","block_type":"box","text":"the probability of recovery. If the likelihood of","page_number":123,"box":{"x":492,"y":630,"width":334,"height":12}},{"id":"a458aa7f-ad55-445c-8590-4f4dc549c093","block_type":"box","text":"recovery materially decreases, due to, for example,","page_number":123,"box":{"x":117,"y":645,"width":377,"height":12}},{"id":"addbef59-d52b-45fb-8600-5eebe775067d","block_type":"box","text":"a change in tax regulation or approach in the foreign","page_number":123,"box":{"x":494,"y":645,"width":385,"height":12}},{"id":"15e3efe4-3e54-4580-a347-19b79b781381","block_type":"box","text":"country, accruals in a Fund’s net asset value for such","page_number":123,"box":{"x":116,"y":661,"width":387,"height":12}},{"id":"e5f9b3d2-b3f7-4e90-b250-a47f034fdc4e","block_type":"box","text":"refunds may be written down partially or in full,","page_number":123,"box":{"x":509,"y":661,"width":336,"height":12}},{"id":"7320cea4-a188-4f28-b081-d861a81eba19","block_type":"box","text":"which will adversely affect the Fund’s net asset value.","page_number":123,"box":{"x":116,"y":676,"width":389,"height":12}},{"id":"c0d0a129-2ae6-43f7-83ba-ecc5187088af","block_type":"box","text":"Shareholders in a Fund at the time an accrual is","page_number":123,"box":{"x":511,"y":676,"width":348,"height":10}},{"id":"7f916ae0-480e-43b3-a41a-2abaef6d041c","block_type":"box","text":"written down will bear the impact of t","page_number":123,"box":{"x":116,"y":692,"width":265,"height":12}},{"id":"39e4bb82-1a28-49cf-b172-a1b699dbc8df","block_type":"box","text":"he resulting reduction in net asset","page_number":123,"box":{"x":382,"y":692,"width":244,"height":12}},{"id":"049b635e-3191-459f-81f2-8229f1a58c68","block_type":"box","text":"value regardless of whether they","page_number":123,"box":{"x":631,"y":692,"width":238,"height":12}},{"id":"8e8845c3-d2b7-41dd-ab61-d3ffedc2f158","block_type":"box","text":"were shareholders during the accrual period. Converse","page_number":123,"box":{"x":116,"y":707,"width":400,"height":12}},{"id":"28bbc78a-b495-44a8-a784-4e833d0717ca","block_type":"box","text":"ly, if a Fund receives a tax refund that has not","page_number":123,"box":{"x":518,"y":707,"width":331,"height":12}},{"id":"dac63437-1529-4bfc-84b5-d918f4b1944c","block_type":"box","text":"been previously accrued, shareholders in the Fund at t","page_number":123,"box":{"x":117,"y":723,"width":396,"height":12}},{"id":"b98b1d6b-a601-4ee2-bea8-af540893fb62","block_type":"box","text":"he time of the successful recovery will benefit from","page_number":123,"box":{"x":514,"y":723,"width":365,"height":12}},{"id":"0d485ceb-df16-401c-b967-842c8149a3cb","block_type":"box","text":"the resulting increase in the Fund’s net asset value.","page_number":123,"box":{"x":116,"y":738,"width":373,"height":12}},{"id":"70eb08bc-db5d-4bb7-b771-2c06a186d374","block_type":"box","text":"Shareholders who sold their shares prior to such","page_number":123,"box":{"x":496,"y":738,"width":351,"height":12}},{"id":"29c34047-0851-401d-bde2-525a886b47f0","block_type":"box","text":"time will not benefit from such increase in the Fund’s net asset value.","page_number":123,"box":{"x":116,"y":754,"width":500,"height":9}},{"id":"e756ad2f-1b19-42c2-a4d7-744d693ebd81","block_type":"box","text":"U.S. Economic Trading Partners Risk.","page_number":123,"box":{"x":117,"y":785,"width":280,"height":12}},{"id":"d2d21bf1-ce9b-4197-8490-12c5741f4e25","block_type":"box","text":"The United States is a significant, and in some cases the most","page_number":123,"box":{"x":404,"y":785,"width":464,"height":12}},{"id":"baafb374-b613-4bde-8c2b-fc76b7701570","block_type":"box","text":"significant, trading partner of, or foreign investor in, certain countries in which a Fund may invest. As a","page_number":123,"box":{"x":116,"y":800,"width":757,"height":12}},{"id":"470a44c1-c840-4f09-b6f7-d09b9e395af6","block_type":"box","text":"result, economic conditions of such countries may be particularly affected by changes in the U.S.","page_number":123,"box":{"x":117,"y":816,"width":717,"height":12}},{"id":"c3018f49-9bf1-4bdb-a5b5-54707054903a","block_type":"box","text":"economy. A decrease in U.S. imports or exports, new trade and financial regulations or tariffs, changes","page_number":123,"box":{"x":116,"y":831,"width":770,"height":12}},{"id":"469a4cf4-cfdb-41c9-915e-a2fde2710846","block_type":"box","text":"in the U.S. dollar exchange rate or an economic slowdown in the United States may have a material","page_number":123,"box":{"x":117,"y":847,"width":745,"height":12}},{"id":"19a2a7f4-ee3e-4f3b-a660-44aec20bc281","block_type":"box","text":"adverse effect on a country’s economic conditions and, as a result, securities to which the Fund has","page_number":123,"box":{"x":116,"y":862,"width":746,"height":12}},{"id":"88fc1240-bc27-4d17-9777-53e62e169677","block_type":"box","text":"exposure. Circumstances could arise that could prevent the timely payment of interest or principal on","page_number":123,"box":{"x":116,"y":878,"width":754,"height":12}},{"id":"024a17a4-71c4-4994-a020-8657a502d31d","block_type":"box","text":"II-39","page_number":123,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"c09798be-4feb-4630-bc0a-dbd7f4332d8c","block_type":"box","text":"NM0926U-5926888-123/257","page_number":123,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"af08b0fc-d6e1-4070-8c8e-7ed7143f3420","block_type":"box","text":"U.S. Government debt, such as reaching the legislative “debt ceiling.” Such non-payment would result","page_number":124,"box":{"x":117,"y":87,"width":760,"height":12}},{"id":"95d4dc7c-b52c-46af-b203-0765485874f5","block_type":"box","text":"in substantial negative consequences for the U.S. economy and the global financial system.","page_number":124,"box":{"x":117,"y":102,"width":685,"height":13}},{"id":"494db23a-94d9-4a3a-afdb-de69b24d39cc","block_type":"box","text":"There are strained relations between the United States and a number of foreign countries, including","page_number":124,"box":{"x":116,"y":135,"width":745,"height":12}},{"id":"917cb55e-d1df-439e-982f-1d7477ab48b1","block_type":"box","text":"traditional allies, such as certain European countries, and historical adversaries, such as North Korea,","page_number":124,"box":{"x":116,"y":151,"width":761,"height":11}},{"id":"9ff5abed-2ede-41e9-bfc2-c10e4d38aee3","block_type":"box","text":"Iran, China and Russia. If these relations were to worsen, it could adversely affect U.S. issuers as well","page_number":124,"box":{"x":117,"y":166,"width":763,"height":12}},{"id":"c8d9a819-2691-4435-b777-21b59ef8fa30","block_type":"box","text":"as non-U.S. issuers that rely on the United States for trade. The United States has also experienced","page_number":124,"box":{"x":116,"y":181,"width":748,"height":12}},{"id":"f004dcad-2c14-4e4d-9ce8-57fe9a7d9881","block_type":"box","text":"increased internal unrest and discord. If these trends were to continue, it may have an adverse impact","page_number":124,"box":{"x":117,"y":197,"width":761,"height":12}},{"id":"9c91c3f8-837b-47a5-80b1-ed0f7852120e","block_type":"box","text":"on the U.S. economy and many of the issuers in which a Fund may invest.","page_number":124,"box":{"x":116,"y":212,"width":557,"height":12}},{"id":"0aa1744d-b25f-42af-88bd-937c06e72b72","block_type":"box","text":"Funding Agreements.","page_number":124,"box":{"x":116,"y":245,"width":171,"height":12}},{"id":"7553be0d-bafe-46b5-969e-3b588f864505","block_type":"box","text":"Certain Funds may invest in Guaranteed Investment Contracts and similar","page_number":124,"box":{"x":289,"y":245,"width":561,"height":12}},{"id":"cfe56840-e269-4f35-964f-a27b4ad47f5c","block_type":"box","text":"funding agreements. In connection with these investments, a Fund makes cash contributions to a","page_number":124,"box":{"x":116,"y":260,"width":727,"height":12}},{"id":"92149098-79cd-4aa1-88bd-29fa4b5010bf","block_type":"box","text":"deposit fund of an insurance company’s general account. The insurance company then credits to the","page_number":124,"box":{"x":116,"y":276,"width":753,"height":12}},{"id":"7dc5e310-4cdb-4db3-8e11-bb408e300cc7","block_type":"box","text":"Fund on a monthly basis guaranteed interest, which is based on an index. The funding agreements","page_number":124,"box":{"x":117,"y":291,"width":740,"height":12}},{"id":"c8f74857-e68d-4d5a-b985-e0ee26e3df6f","block_type":"box","text":"provide that this guaranteed interest will not be less than a certain minimum rate. The purchase price","page_number":124,"box":{"x":117,"y":307,"width":753,"height":12}},{"id":"f9dd30cf-ba88-4783-869c-b3da68d55feb","block_type":"box","text":"paid for a funding agreement becomes part of the general assets of the insurance company, and the","page_number":124,"box":{"x":117,"y":322,"width":749,"height":12}},{"id":"a7558a2d-8d24-481e-857f-7a02eab0b8da","block_type":"box","text":"contract is paid from the general assets of the insurance company. Generally, funding agreements are","page_number":124,"box":{"x":116,"y":338,"width":764,"height":12}},{"id":"220dd606-4212-4606-9aa8-0632ea7cf59c","block_type":"box","text":"not assignable or transferable without the permission of the issuing insurance companies, and an","page_number":124,"box":{"x":117,"y":353,"width":726,"height":12}},{"id":"91ec2bb2-4a77-4637-aa7b-effabf517116","block_type":"box","text":"active secondary market in some funding agreements does not currently exist.","page_number":124,"box":{"x":116,"y":369,"width":586,"height":12}},{"id":"b8a08976-00e4-4dbe-a1a3-7cc7cf8e10bc","block_type":"box","text":"Guarantees","page_number":124,"box":{"x":117,"y":401,"width":91,"height":10}},{"id":"5d84828c-7828-47a4-b6ff-a22668467b40","block_type":"box","text":".","page_number":124,"box":{"x":209,"y":409,"width":3,"height":2}},{"id":"5353925a-7b97-4808-9c20-a7ed8101b5aa","block_type":"box","text":"A Fund may purchase securities which contain guarantees issued by an entity separate","page_number":124,"box":{"x":213,"y":401,"width":660,"height":12}},{"id":"ecd3aaed-c50f-4114-9070-85f9baef9686","block_type":"box","text":"from the issuer of the security. Generally, the guarantor of a security (often an affiliate of the issuer) will","page_number":124,"box":{"x":116,"y":417,"width":771,"height":12}},{"id":"bb265654-e25e-4ebe-9ceb-5351e7f8a0de","block_type":"box","text":"fulfill an issuer’s payment obligations under a security if the issuer is unable to do so.","page_number":124,"box":{"x":116,"y":432,"width":634,"height":12}},{"id":"01c238df-322f-49a6-8abb-ac86ce3863b8","block_type":"box","text":"Illiquid Investments.","page_number":124,"box":{"x":116,"y":465,"width":160,"height":11}},{"id":"261759f9-edc4-43a9-aea5-f88ea807d370","block_type":"box","text":"Each Fund may not acquire any illiquid investment if, immediately after the","page_number":124,"box":{"x":278,"y":465,"width":563,"height":12}},{"id":"b1622edb-af43-448f-afd3-987370f2741c","block_type":"box","text":"acquisition, a Fund would have invested more than 15% of its net assets in illiquid investments. An","page_number":124,"box":{"x":116,"y":480,"width":737,"height":12}},{"id":"e1809bb0-12e4-4c65-bbcb-c3d05270d921","block_type":"box","text":"illiquid investment is any investment that a Fund reasonably expects cannot be sold or disposed of in","page_number":124,"box":{"x":117,"y":496,"width":753,"height":12}},{"id":"0a2d9c36-c89f-41d9-b0be-04f1ae24c36d","block_type":"box","text":"current market conditions in seven calendar days or less without the sale or disposition significantly","page_number":124,"box":{"x":116,"y":511,"width":742,"height":12}},{"id":"6fd44b27-447b-4500-9fe2-c5ab27bc10fc","block_type":"box","text":"changing the market value of the investment. Liquid investments may become illiquid after purchase by","page_number":124,"box":{"x":116,"y":527,"width":771,"height":12}},{"id":"2d6c635f-2676-4e61-b4e2-82f0e81e4f2d","block_type":"box","text":"a Fund, particularly during periods of market turmoil. There can be no assurance that a security or","page_number":124,"box":{"x":116,"y":542,"width":733,"height":12}},{"id":"e7c0cc95-6d09-47d8-bca4-02c1e949d5f9","block_type":"box","text":"instrument that is deemed to be liquid when purchased will continue to be liquid for as long as it is held","page_number":124,"box":{"x":117,"y":558,"width":766,"height":12}},{"id":"7276ee86-a82b-4ca7-8ff3-3882100891c6","block_type":"box","text":"by a Fund, and any security or instrument held by the Fund may be deemed an illiquid investment","page_number":124,"box":{"x":117,"y":573,"width":729,"height":12}},{"id":"068d4f18-d0c9-43df-ba44-819aebc422ab","block_type":"box","text":"pursuant to the Fund’s liquidity risk management program. A Fund’s illiquid investments may reduce","page_number":124,"box":{"x":117,"y":589,"width":747,"height":12}},{"id":"04313f85-54bd-4f0f-b381-4e6f445a9ab6","block_type":"box","text":"the returns of the Fund because it may be difficult to sell the illiquid investments at an advantageous","page_number":124,"box":{"x":116,"y":604,"width":748,"height":12}},{"id":"57ec03f8-3511-4cbf-b980-4326fc4260ad","block_type":"box","text":"time or price. In addition, if a Fund is limited in its ability to dispose of illiquid investments during","page_number":124,"box":{"x":116,"y":620,"width":713,"height":12}},{"id":"261ea07b-cff3-459b-9147-93f2f6d4433c","block_type":"box","text":"periods when shareholders are redeeming or selling their shares or the Fund’s net assets otherwise","page_number":124,"box":{"x":117,"y":635,"width":744,"height":12}},{"id":"46c1dcb8-c810-417e-afe6-1b1379b0993f","block_type":"box","text":"shrink, the Fund will need to dispose of liquid securities to meet redemption requests and illiquid","page_number":124,"box":{"x":116,"y":651,"width":718,"height":12}},{"id":"4da6a564-5f81-408a-9f8e-584e201e5ea5","block_type":"box","text":"securities will become a larger portion of the Fund’s holdings. If illiquid investments exceed 15% of a","page_number":124,"box":{"x":116,"y":666,"width":745,"height":12}},{"id":"fb5df507-257e-4d64-979d-a87ee9d1b612","block_type":"box","text":"Fund’s net assets, the Liquidity Rule (as defined below) and the Liquidity Program (as defined below)","page_number":124,"box":{"x":117,"y":682,"width":749,"height":12}},{"id":"3134d383-84ee-494b-853e-9bb6f9591f16","block_type":"box","text":"will require that certain remedial actions be taken. Illiquid investments may trade at a discount from","page_number":124,"box":{"x":116,"y":697,"width":733,"height":12}},{"id":"4e7f19ae-a2a4-4aae-baad-329c9855440a","block_type":"box","text":"comparable liquid investments. Investment of a Fund’s assets in illiquid investments may restrict the","page_number":124,"box":{"x":116,"y":713,"width":742,"height":12}},{"id":"1e391e3a-6744-419c-a212-a4fd74615934","block_type":"box","text":"ability of the Fund to dispose of its investments in a timely fashion and for a fair price as well as its","page_number":124,"box":{"x":116,"y":728,"width":728,"height":12}},{"id":"2d7ab46f-8a85-4fac-8783-e0816b2d01d4","block_type":"box","text":"ability to take advantage of market opportunities. The risks associated with illiquidity will be particularly","page_number":124,"box":{"x":116,"y":744,"width":760,"height":12}},{"id":"a270fd26-725d-4bd0-bbe5-19e5ed1b9f91","block_type":"box","text":"acute where a Fund’s operations require cash, such as when the Fund redeems shares or pays","page_number":124,"box":{"x":116,"y":759,"width":709,"height":12}},{"id":"bc7e5e76-5ea9-42f4-b150-29ea4afb4751","block_type":"box","text":"dividends, and could result in the Fund borrowing to meet short-term cash requirements or incurring","page_number":124,"box":{"x":116,"y":775,"width":740,"height":12}},{"id":"4aa3a394-f82d-4e2d-8c4a-3db6f29c6f8d","block_type":"box","text":"capital losses on the sale of illiquid investments.","page_number":124,"box":{"x":116,"y":790,"width":355,"height":12}},{"id":"dbd9d532-cb8b-430a-bc88-3a7c31dfa92c","block_type":"box","text":"Index Funds.","page_number":124,"box":{"x":116,"y":823,"width":102,"height":9}},{"id":"651c880c-afbc-4f70-b162-e0b3ded49242","block_type":"box","text":"Cash Flows; Expenses.","page_number":124,"box":{"x":117,"y":846,"width":173,"height":12}},{"id":"f9f7fbdc-f754-4873-ab2d-29e6fb0613a9","block_type":"box","text":"The ability of each Fund to satisfy its investment objective depends to some","page_number":124,"box":{"x":291,"y":846,"width":573,"height":12}},{"id":"3c5a860c-7d67-4053-92a8-e2f3ae843876","block_type":"box","text":"extent on the Manager’s ability to manage cash flow (primarily from purchases and redemptions and","page_number":124,"box":{"x":116,"y":862,"width":749,"height":12}},{"id":"474834e7-bb16-487c-92b5-98bc6b822f5b","block_type":"box","text":"distributions from the Fund’s investments). The Manager will make investment changes to a Fund’s","page_number":124,"box":{"x":116,"y":877,"width":742,"height":12}},{"id":"147ca1b2-0438-491b-8698-53893987af84","block_type":"box","text":"II-40","page_number":124,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"ef91e7fb-9db9-4eaa-9c46-5327b9f49277","block_type":"box","text":"NM0926U-5926888-124/257","page_number":124,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"89469557-8d8d-45d4-a047-a7807a208129","block_type":"box","text":"portfolio to accommodate cash flow while continuing to seek to replicate the total return of the Fund’s","page_number":125,"box":{"x":117,"y":87,"width":753,"height":12}},{"id":"daad0906-9b13-4c5b-bfa8-473af461649c","block_type":"box","text":"target index. Investors should also be aware that the investment performance of each index is a","page_number":125,"box":{"x":116,"y":102,"width":716,"height":13}},{"id":"c4013a96-a948-4f57-88b9-148581b08dfe","block_type":"box","text":"hypothetical number which does not take into account brokerage commissions and other transaction","page_number":125,"box":{"x":117,"y":118,"width":749,"height":12}},{"id":"1136e315-5847-4859-895f-3d43b941aff5","block_type":"box","text":"costs, custody and other costs of investing, and any incremental operating costs (e.g., transfer agency","page_number":125,"box":{"x":116,"y":134,"width":765,"height":12}},{"id":"3fbb9460-dca6-476b-a244-a306aa24a0d4","block_type":"box","text":"and accounting costs) that will be borne by the Funds. Finally, since each Fund seeks to replicate the","page_number":125,"box":{"x":116,"y":149,"width":757,"height":12}},{"id":"2666151d-a283-4b8d-84ea-529ca964a626","block_type":"box","text":"total return of its target index, the Manager generally will not attempt to judge the merits of any","page_number":125,"box":{"x":116,"y":165,"width":706,"height":12}},{"id":"d27edbdd-1c5f-4643-8a09-5c52f73d4181","block_type":"box","text":"particular security as an investment.","page_number":125,"box":{"x":117,"y":180,"width":272,"height":12}},{"id":"16b3560a-3ada-4355-9a27-14f99242acec","block_type":"box","text":"Tracking Error Risk","page_number":125,"box":{"x":118,"y":211,"width":143,"height":12}},{"id":"f1755afd-4baf-47ea-a428-65312dc02d50","block_type":"box","text":". A Fund may be subject to tracking error, which is the divergence of the Fund’s","page_number":125,"box":{"x":261,"y":211,"width":594,"height":12}},{"id":"e9aa4bc7-2153-4796-82b5-a49a247cd735","block_type":"box","text":"performance from that of the Underlying Index. 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Inflation rates may change frequently and significantly due to a number","page_number":128,"box":{"x":116,"y":552,"width":764,"height":12}},{"id":"443f181b-65e3-4844-bf5d-b28900b90705","block_type":"box","text":"of potential factors, including, among others, unexpected economic shifts or changes in fiscal or","page_number":128,"box":{"x":116,"y":568,"width":716,"height":12}},{"id":"00f030c3-b7dc-4f5c-b58d-0cd24feb1afa","block_type":"box","text":"monetary policies.","page_number":128,"box":{"x":117,"y":583,"width":139,"height":12}},{"id":"080c8ebf-9d74-443b-bd97-665366422192","block_type":"box","text":"Initial Public Offering (“IPO”) Risk.","page_number":128,"box":{"x":116,"y":614,"width":275,"height":12}},{"id":"8aeb69c8-e107-49f8-9087-b02c9f0be379","block_type":"box","text":"The volume of IPOs and the levels at which the newly issued","page_number":128,"box":{"x":392,"y":614,"width":462,"height":12}},{"id":"103fa4b5-0f86-4ace-8b35-ce9d4fd2afb8","block_type":"box","text":"stocks trade in the secondary market are affected by the performance of the stock market overall. If","page_number":128,"box":{"x":116,"y":630,"width":743,"height":12}},{"id":"c75dbe91-9aaa-4091-ae93-a8c57cac0fa5","block_type":"box","text":"IPOs are brought to the market, availability may be limited and a Fund may not be able to buy any","page_number":128,"box":{"x":117,"y":645,"width":732,"height":12}},{"id":"af68ca02-1428-4340-a4fd-29862e115bc2","block_type":"box","text":"shares at the offering price, or if it is able to buy shares, it may not be able to buy as many shares at","page_number":128,"box":{"x":116,"y":661,"width":744,"height":12}},{"id":"887615bf-df42-4101-adfb-62f1ac111109","block_type":"box","text":"the offering price as it would like. In addition, the prices of securities involved in IPOs are often subject","page_number":128,"box":{"x":116,"y":676,"width":758,"height":12}},{"id":"6f0209cb-7fe5-4d98-9467-44e5a6a6edfb","block_type":"box","text":"to greater and more unpredictable price changes than more established stocks. IPOs have the","page_number":128,"box":{"x":116,"y":692,"width":701,"height":12}},{"id":"77dc9a6a-edca-4eb9-97bf-98eae7edce07","block_type":"box","text":"potential to produce substantial gains. A Fund may hold shares from an IPO for only a short period of","page_number":128,"box":{"x":117,"y":707,"width":751,"height":12}},{"id":"3218b368-858c-4837-9144-7a9d9baa49e6","block_type":"box","text":"time given possible price volatility. This may result in increased portfolio turnover and expenses, such","page_number":128,"box":{"x":116,"y":723,"width":752,"height":12}},{"id":"70fff2d3-8254-4070-a82f-4e99ac3a2d52","block_type":"box","text":"as commissions and transaction costs, and potentially result in taxable gains that the Fund will","page_number":128,"box":{"x":116,"y":738,"width":699,"height":12}},{"id":"7c342045-78f3-40d2-b687-1718efd1846e","block_type":"box","text":"subsequently distribute to shareholders. There is no assurance that any Fund will have access to","page_number":128,"box":{"x":116,"y":754,"width":720,"height":12}},{"id":"10c65642-0d8f-47d5-9c6d-be4eadd663c0","block_type":"box","text":"profitable IPOs and therefore investors should not rely on any past gains from IPOs as an indication of","page_number":128,"box":{"x":117,"y":769,"width":759,"height":12}},{"id":"bde02d37-18b4-4be9-80c5-d9950e5c2a55","block_type":"box","text":"future performance. The investment performance of a Fund during periods when it is unable to invest","page_number":128,"box":{"x":116,"y":785,"width":750,"height":12}},{"id":"8d6f176b-45e2-44f5-8532-2b06ec6d527f","block_type":"box","text":"significantly or at all in IPOs may be lower than during periods when it is able to do so. In addition, as a","page_number":128,"box":{"x":116,"y":800,"width":763,"height":12}},{"id":"f431a0ae-bf92-4797-bccd-f2c3189956da","block_type":"box","text":"Fund increases in size, the impact of IPOs on its performance will generally decrease. Securities","page_number":128,"box":{"x":117,"y":816,"width":716,"height":12}},{"id":"5eca7dcb-ad20-4fe1-bbd1-f0b9578eb9c0","block_type":"box","text":"issued in IPOs are subject to many of the same risks as investing in companies with smaller market","page_number":128,"box":{"x":117,"y":831,"width":743,"height":12}},{"id":"5d0a5a9b-4de8-44ec-a000-321f042dce25","block_type":"box","text":"capitalizations. Securities issued in IPOs have no trading history, and information about the companies","page_number":128,"box":{"x":116,"y":847,"width":768,"height":12}},{"id":"5bd84808-434f-4001-b5d0-61b285c6cf15","block_type":"box","text":"may be available for very limited periods.","page_number":128,"box":{"x":117,"y":862,"width":308,"height":12}},{"id":"cdf5ed6c-b93d-4265-a913-6ea9197bf230","block_type":"box","text":"II-44","page_number":128,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"5a06114f-272d-4394-a7df-527341d1b183","block_type":"box","text":"NM0926U-5926888-128/257","page_number":128,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"b935bd77-9bdc-4a55-ba04-2340cf53bad5","block_type":"box","text":"Investment in Emerging Markets.","page_number":129,"box":{"x":116,"y":87,"width":268,"height":12}},{"id":"b1cb97da-85ca-4328-8468-128d4dbeddde","block_type":"box","text":"General.","page_number":129,"box":{"x":117,"y":110,"width":68,"height":10}},{"id":"b66d197d-5f03-42f5-9ab1-9b1f0a17ef13","block_type":"box","text":"Certain Funds may invest in the securities of issuers domiciled in various countries with emerging","page_number":129,"box":{"x":117,"y":134,"width":727,"height":12}},{"id":"1c64a476-a628-434c-ae9e-51a7a173cffc","block_type":"box","text":"capital markets. Unless otherwise provided in a Fund’s Prospectus, a country with an emerging capital","page_number":129,"box":{"x":116,"y":149,"width":765,"height":12}},{"id":"70bbc849-921d-4622-8193-941d184b55ac","block_type":"box","text":"market is any country that is (i) generally recognized to be an emerging market country by the","page_number":129,"box":{"x":117,"y":165,"width":700,"height":12}},{"id":"1602b1f2-399b-44e0-aa24-7d9f5c04d2cb","block_type":"box","text":"international financial community, such as the International Finance Corporation, or","page_number":129,"box":{"x":117,"y":180,"width":617,"height":12}},{"id":"bbdda6f7-374f-4927-945c-979651a8c8bc","block_type":"box","text":"determined by the","page_number":129,"box":{"x":739,"y":180,"width":139,"height":12}},{"id":"93558da0-c813-427e-80af-e33812f06eb0","block_type":"box","text":"World Bank to have a low, middle or middle upper income economy; (ii) classified by the United","page_number":129,"box":{"x":116,"y":196,"width":714,"height":12}},{"id":"99cc2c8f-bd91-4d79-9a82-8dc81b4f61aa","block_type":"box","text":"Nations or its authorities to be developing; and/or (iii) included in a broad-based index that is generally","page_number":129,"box":{"x":117,"y":211,"width":762,"height":12}},{"id":"7f9e625f-ba6b-440b-8128-7f96b735ca54","block_type":"box","text":"representative of emerging markets. Countries with emerging markets can be found in regions such as","page_number":129,"box":{"x":117,"y":227,"width":766,"height":12}},{"id":"0fbd02aa-cc91-416e-b4b7-ebcc236f64de","block_type":"box","text":"Asia, Latin America, Eastern Europe and Africa.","page_number":129,"box":{"x":116,"y":242,"width":361,"height":12}},{"id":"3a299303-85b1-41cd-a9db-084c688ffbc3","block_type":"box","text":"Investments in the securities of issuers domiciled in countries with emerging capital markets involve","page_number":129,"box":{"x":117,"y":273,"width":743,"height":12}},{"id":"dd94c7f8-0869-4be8-b0f7-725f3553394c","block_type":"box","text":"certain additional risks that do not generally apply to investments in securities of issuers in more","page_number":129,"box":{"x":116,"y":289,"width":717,"height":12}},{"id":"75d9438a-97e1-4c5f-a6ba-97753c6c23fa","block_type":"box","text":"developed capital markets, such as (i) low or non-existent trading volume, resulting in market illiquidity","page_number":129,"box":{"x":116,"y":304,"width":763,"height":12}},{"id":"81fe6585-cec1-41ca-9dd6-a0bb4a161112","block_type":"box","text":"and increased volatility in prices for such securities, as compared to securities of comparable issuers in","page_number":129,"box":{"x":116,"y":320,"width":771,"height":12}},{"id":"1e9e5974-9f99-4617-9eec-10e4cba5e5bc","block_type":"box","text":"more developed capital markets; (ii) uncertain national policies and social, political and economic","page_number":129,"box":{"x":117,"y":335,"width":723,"height":12}},{"id":"97da5e31-09df-4049-bf8d-8b7be3ab4701","block_type":"box","text":"instability, increasing the potential for expropriation of assets, confiscatory taxation, high rates of","page_number":129,"box":{"x":117,"y":351,"width":718,"height":12}},{"id":"e2618988-c499-486a-9729-ce306e289109","block_type":"box","text":"inflation or unfavorable diplomatic developments; (iii) possible fluctuations in exchange rates, differing","page_number":129,"box":{"x":117,"y":366,"width":758,"height":12}},{"id":"a411ff02-0245-4fd2-a468-6d8d46b60bbe","block_type":"box","text":"legal systems and the existence or possible imposition of exchange controls, custodial restrictions or","page_number":129,"box":{"x":117,"y":382,"width":750,"height":12}},{"id":"5ad3790d-114f-4532-b299-2fc4715dcad0","block_type":"box","text":"other foreign or U.S. Governmental laws or restrictions applicable to such investments; (iv) national","page_number":129,"box":{"x":116,"y":397,"width":741,"height":12}},{"id":"ecae459f-1de7-4fc7-9508-ab208770f9b1","block_type":"box","text":"policies that may limit a Fund’s investment opportunities such as restrictions on investment in issuers","page_number":129,"box":{"x":117,"y":413,"width":754,"height":12}},{"id":"386f6bb6-ba73-4b9b-96cf-d15707092eb2","block_type":"box","text":"or industries deemed sensitive to national interests; and (v) the lack or relatively early development of","page_number":129,"box":{"x":116,"y":428,"width":759,"height":12}},{"id":"d56be482-3ab3-4843-8d5e-877985340e33","block_type":"box","text":"legal structures governing private and foreign investments and private property. In addition to","page_number":129,"box":{"x":117,"y":444,"width":695,"height":12}},{"id":"7a5b395c-084e-4dba-9f82-aead1b9ccd68","block_type":"box","text":"withholding taxes on investment income, some countries with emerging markets may impose","page_number":129,"box":{"x":116,"y":459,"width":695,"height":12}},{"id":"adb21fa4-30c0-4466-92a7-49adf3a02b1d","block_type":"box","text":"differential capital gains taxes on foreign investors.","page_number":129,"box":{"x":116,"y":475,"width":381,"height":12}},{"id":"54531a0d-0034-453d-9d4f-d78b2ce0b703","block_type":"box","text":"Political and economic structures in emerging market countries may be undergoing significant","page_number":129,"box":{"x":117,"y":506,"width":699,"height":12}},{"id":"5c1445fc-a678-448f-9841-d3b302d57d60","block_type":"box","text":"evolution and rapid development, and these countries may lack the social, political and economic","page_number":129,"box":{"x":116,"y":521,"width":726,"height":12}},{"id":"a2af9a28-e1c2-4a9a-a088-7cce769114e4","block_type":"box","text":"stability characteristic of more developed countries. In such a dynamic environment, there can be no","page_number":129,"box":{"x":116,"y":537,"width":750,"height":12}},{"id":"5dd71bbe-d9af-41f9-8996-6b02319a004e","block_type":"box","text":"assurance that any or all of these capital markets will continue to present viable investment","page_number":129,"box":{"x":116,"y":552,"width":681,"height":12}},{"id":"b70e22fb-da8d-4090-a18e-163e181ef750","block_type":"box","text":"opportunities for a Fund. In the past, governments of such nations have expropriated substantial","page_number":129,"box":{"x":116,"y":568,"width":719,"height":12}},{"id":"89800a31-5785-4fcc-967f-bb68b40efe93","block_type":"box","text":"amounts of private property, and most claims of the property owners have never been fully settled.","page_number":129,"box":{"x":116,"y":583,"width":736,"height":12}},{"id":"80333309-0b00-4c14-82d0-8b0edf30a753","block_type":"box","text":"There is no assurance that such expropriations will not reoccur. In such an event, it is possible that a","page_number":129,"box":{"x":116,"y":599,"width":752,"height":12}},{"id":"d9b0df0d-a405-446f-b70f-f6e09c059aa1","block_type":"box","text":"Fund could lose the entire value of its investments in the affected market. As a result the risks","page_number":129,"box":{"x":117,"y":614,"width":700,"height":10}},{"id":"41404b08-24e0-44a0-bc48-4236e49c7428","block_type":"box","text":"described above, including the risks of nationalization or expropriation of assets, may be heightened. In","page_number":129,"box":{"x":116,"y":630,"width":772,"height":12}},{"id":"9d25150c-452a-4201-9a26-51d529f6b954","block_type":"box","text":"addition, unanticipated political or social developments may affect the value of investments in these","page_number":129,"box":{"x":116,"y":645,"width":742,"height":12}},{"id":"570ea52f-911f-4aff-8bae-c1d8eed84896","block_type":"box","text":"countries and the availability to a Fund of additional investments. The small size and inexperience of","page_number":129,"box":{"x":116,"y":661,"width":746,"height":12}},{"id":"fd3ed31b-dfae-4d65-b208-23b9d4dd4308","block_type":"box","text":"the securities markets in certain of these countries and the limited volume of trading in securities in","page_number":129,"box":{"x":116,"y":676,"width":732,"height":12}},{"id":"0b6804c3-86ce-4b40-a7ae-0a41410a4aa2","block_type":"box","text":"these countries may make investments in the countries illiquid and more volatile than investments in","page_number":129,"box":{"x":116,"y":692,"width":742,"height":12}},{"id":"0c2db25f-cd3f-4b87-957b-11b8fef8d415","block_type":"box","text":"more established markets.","page_number":129,"box":{"x":117,"y":707,"width":195,"height":10}},{"id":"733526af-0dbe-4930-9b1a-d326c9b72a02","block_type":"box","text":"Also, there may be less publicly available information about issuers in emerging markets than would be","page_number":129,"box":{"x":116,"y":738,"width":765,"height":12}},{"id":"7df3723c-20fa-409f-8e3d-0dd9bd5a8016","block_type":"box","text":"available about issuers in more developed capital markets, and such issuers may not be subject to","page_number":129,"box":{"x":116,"y":754,"width":732,"height":12}},{"id":"36b7750c-4332-4f94-96da-564ded8716f6","block_type":"box","text":"accounting, auditing and financial reporting standards and requirements comparable to those to which","page_number":129,"box":{"x":116,"y":769,"width":756,"height":12}},{"id":"9fdecff2-58ad-455f-9dc4-d96d4838def6","block_type":"box","text":"U.S. companies are subject. In certain countries with emerging capital markets, reporting standards","page_number":129,"box":{"x":117,"y":785,"width":737,"height":12}},{"id":"22e48438-ce4a-40fd-b62f-1ba1c60222d3","block_type":"box","text":"vary widely. As a result, traditional investment measurements used in the United States, such as price/","page_number":129,"box":{"x":116,"y":800,"width":762,"height":12}},{"id":"14835261-051f-420c-a535-1d75db0e0e28","block_type":"box","text":"earnings ratios, may not be applicable. Emerging market securities may be substantially less liquid","page_number":129,"box":{"x":116,"y":816,"width":731,"height":12}},{"id":"fd6a9295-f20e-4b1d-b22b-7ea6201f0a4b","block_type":"box","text":"than, and more volatile than, those of mature markets, and company shares may be held by a limited","page_number":129,"box":{"x":116,"y":831,"width":755,"height":12}},{"id":"c7b4356e-54c8-48f0-b3f7-9cfa1847f543","block_type":"box","text":"number of persons. This may adversely affect the timing and pricing of the Fund’s acquisition or","page_number":129,"box":{"x":117,"y":847,"width":715,"height":12}},{"id":"23eb7d2d-97c0-470d-829f-680bf14def21","block_type":"box","text":"disposal of securities.","page_number":129,"box":{"x":116,"y":862,"width":165,"height":12}},{"id":"fca20a08-0a31-4695-ac25-d851d8c9a541","block_type":"box","text":"II-45","page_number":129,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"863d886d-865c-4b73-aaa1-f7ec65148e8c","block_type":"box","text":"NM0926U-5926888-129/257","page_number":129,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"f7af4c29-3e5f-4d84-af62-ee56306e2b6e","block_type":"box","text":"Practices in relation to settlement of securities transactions in emerging markets involve higher risks","page_number":130,"box":{"x":117,"y":87,"width":746,"height":12}},{"id":"4ee5981c-8bc7-4e8d-af1a-30f79ccdf07d","block_type":"box","text":"than those in developed markets, in part because a Fund will need to use brokers and counterparties","page_number":130,"box":{"x":116,"y":103,"width":755,"height":11}},{"id":"1fdcf779-043b-4aab-89c2-083758d07a3e","block_type":"box","text":"that are less well capitalized, and custody and registration of assets in some countries may be","page_number":130,"box":{"x":116,"y":118,"width":703,"height":12}},{"id":"50b340e2-f2a4-4895-b318-25258d518fee","block_type":"box","text":"unreliable. The possibility of fraud, negligence, undue influence being exerted by the issuer or refusal","page_number":130,"box":{"x":117,"y":134,"width":754,"height":12}},{"id":"ba025704-1fb0-4bdc-ab12-c60c1e0448bb","block_type":"box","text":"to recognize ownership exists in some emerging markets, and, along with other factors, could result in","page_number":130,"box":{"x":116,"y":149,"width":762,"height":12}},{"id":"22738fb4-4460-4e37-bb9d-ba46148aea66","block_type":"box","text":"ownership registration being completely lost. A Fund would absorb any loss resulting from such","page_number":130,"box":{"x":116,"y":165,"width":712,"height":12}},{"id":"30541ee7-faa8-4003-93b2-2c3e54980686","block_type":"box","text":"registration problems and may have no successful claim for compensation.","page_number":130,"box":{"x":117,"y":180,"width":560,"height":12}},{"id":"4ec13de8-8bc8-4e3e-a07e-d07e2537d5a2","block_type":"box","text":"Investment in non-dollar denominated securities including securities from issuers located in emerging","page_number":130,"box":{"x":117,"y":211,"width":755,"height":12}},{"id":"6d2f70b0-3545-4caa-b908-86496839967d","block_type":"box","text":"market countries may be on either a currency hedged or unhedged basis, and the Funds may hold","page_number":130,"box":{"x":117,"y":227,"width":735,"height":12}},{"id":"20a798ea-9ef2-41f9-9480-650a0a5dbfd7","block_type":"box","text":"from time to time various foreign currencies pending investment or conversion into U.S. dollars. Some","page_number":130,"box":{"x":116,"y":242,"width":761,"height":12}},{"id":"e330567e-16c1-42cc-ab7a-a6ef3e78e2eb","block_type":"box","text":"of these instruments may have the characteristics of futures contracts. In addition, certain Funds may","page_number":130,"box":{"x":116,"y":258,"width":757,"height":12}},{"id":"28d6252b-8fbd-40f5-bc4c-680f17ede110","block_type":"box","text":"engage in foreign currency exchange transactions to seek to protect against changes in the level of","page_number":130,"box":{"x":116,"y":273,"width":742,"height":12}},{"id":"e52c3c3e-cd71-4755-bc8c-790dd26c0b34","block_type":"box","text":"future exchange rates which would adversely affect the Fund’s performance. These investments and","page_number":130,"box":{"x":116,"y":289,"width":752,"height":12}},{"id":"664d3672-e1c3-459f-a26d-4a2afe888d71","block_type":"box","text":"transactions involving foreign securities, currencies, options (including options that relate to foreign","page_number":130,"box":{"x":116,"y":304,"width":738,"height":12}},{"id":"f808a0cc-1712-4068-b8f2-2aa7ff8db174","block_type":"box","text":"currencies), futures, hedging and cross-hedging are described under “Derivatives.”","page_number":130,"box":{"x":116,"y":320,"width":619,"height":12}},{"id":"ee93dddf-0cf5-4a16-8425-c1a103cbdf0d","block_type":"box","text":"Risks of Investing in Asia-Pacific Countries.","page_number":130,"box":{"x":116,"y":351,"width":328,"height":12}},{"id":"6c5ec26a-5c4b-4f90-8890-942373172e8f","block_type":"box","text":"In addition to the risks of foreign investing and the risks of","page_number":130,"box":{"x":445,"y":351,"width":432,"height":12}},{"id":"71af2d93-5330-480b-9838-962f3e2b0810","block_type":"box","text":"investing in developing markets, the developing market Asia-Pacific countries in which a Fund may","page_number":130,"box":{"x":117,"y":366,"width":738,"height":12}},{"id":"42ce2965-0690-4abf-8f5a-ce39d3f75cef","block_type":"box","text":"invest are subject to certain additional or specific risks. Certain Funds may make substantial","page_number":130,"box":{"x":117,"y":382,"width":687,"height":12}},{"id":"25ca8b51-04dd-478e-b3dc-584bce13f91b","block_type":"box","text":"investments in Asia-Pacific countries. In many of these markets, there is a high concentration of market","page_number":130,"box":{"x":117,"y":397,"width":771,"height":12}},{"id":"41bf7be2-c85e-41ea-9871-8a0108187094","block_type":"box","text":"capitalization and trading volume in a small number of issuers representing a limited number of","page_number":130,"box":{"x":116,"y":413,"width":710,"height":12}},{"id":"e18429f7-379d-4f76-9a63-c30a1719d70d","block_type":"box","text":"industries, as well as a high concentration of investors and financial intermediaries. Many of these","page_number":130,"box":{"x":117,"y":428,"width":730,"height":12}},{"id":"a8056c8a-a16a-4ea7-8e0d-991e91a96c7d","block_type":"box","text":"markets also may be affected by developments with respect to more established markets in the region","page_number":130,"box":{"x":117,"y":444,"width":763,"height":12}},{"id":"d6fd0b94-fad7-422a-b971-7a9b44b4f207","block_type":"box","text":"such as in Japan and Hong Kong. Brokers in developing market Asia-Pacific countries typically are","page_number":130,"box":{"x":116,"y":459,"width":739,"height":12}},{"id":"a66fc2d1-1507-40cc-822f-5e4f5b13e9b0","block_type":"box","text":"fewer in number and less well capitalized than brokers in the United States. These factors, combined","page_number":130,"box":{"x":116,"y":475,"width":754,"height":12}},{"id":"1324d728-454b-4f22-8125-daa71ccd1445","block_type":"box","text":"with the U.S. regulatory requirements for open-end investment companies and the restrictions on","page_number":130,"box":{"x":116,"y":490,"width":725,"height":12}},{"id":"27732fca-4891-46b4-8fd6-c5bed9b8b138","block_type":"box","text":"foreign investment discussed below, result in potentially fewer investment opportunities for a Fund and","page_number":130,"box":{"x":116,"y":506,"width":766,"height":12}},{"id":"a7bfc4d2-b299-40eb-b176-a256f63fd869","block_type":"box","text":"may have an adverse impact on the investment performance of the Fund.","page_number":130,"box":{"x":117,"y":521,"width":550,"height":12}},{"id":"844a1a83-65a8-4f0b-a815-a503ec185fce","block_type":"box","text":"Many of the developing market Asia-Pacific countries may be subject to a greater degree of economic,","page_number":130,"box":{"x":117,"y":552,"width":757,"height":12}},{"id":"f75b2ec0-cd49-42e8-98aa-fa5a5d104057","block_type":"box","text":"political and social instability than is the case in the United States and Western European countries.","page_number":130,"box":{"x":117,"y":568,"width":736,"height":12}},{"id":"f4b6debd-42d9-425f-bfc0-9ea95bd9f24b","block_type":"box","text":"Such instability may result from, among other things: (i) authoritarian governments or military","page_number":130,"box":{"x":116,"y":583,"width":686,"height":12}},{"id":"d49a8b75-2e04-4628-a46e-29937efb4d68","block_type":"box","text":"involvement in political and economic decision-making, including changes in government through extra","page_number":130,"box":{"x":117,"y":599,"width":759,"height":12}},{"id":"266775c6-5191-40ea-924c-7e330fd2afa5","block_type":"box","text":"constitutional means; (ii) popular unrest associated with demands for improved political, economic and","page_number":130,"box":{"x":116,"y":614,"width":757,"height":12}},{"id":"5d14ebe0-3247-41ce-98e6-d03280ff22d6","block_type":"box","text":"social conditions; (iii) internal insurgencies; (iv) hostile relations with neighboring countries; and","page_number":130,"box":{"x":116,"y":630,"width":703,"height":12}},{"id":"795a8814-ecd7-436d-a7a7-585bc5ee8f62","block_type":"box","text":"(v) ethnic, religious and racial disaffection. In addition, the governments of many of such countries, such","page_number":130,"box":{"x":117,"y":645,"width":767,"height":12}},{"id":"19568080-d394-4653-9bbc-ab7ba65883e8","block_type":"box","text":"as Indonesia, have a substantial role in regulating and supervising the economy. Another risk common","page_number":130,"box":{"x":116,"y":661,"width":752,"height":12}},{"id":"d0f56f9e-2471-49c2-913c-dfbfedf3c653","block_type":"box","text":"to most such countries is that the economy is heavily export oriented and, accordingly, is dependent","page_number":130,"box":{"x":116,"y":676,"width":735,"height":12}},{"id":"c989a3e6-50fd-48b6-a09c-cf8bf519bc51","block_type":"box","text":"upon international trade. The existence of overburdened infrastructure and obsolete financial systems","page_number":130,"box":{"x":117,"y":692,"width":745,"height":12}},{"id":"4172fbaf-ff53-4554-a6f3-a8e073abc9e3","block_type":"box","text":"also presents risks in certain countries, as do environmental problems. Certain economies also depend","page_number":130,"box":{"x":116,"y":707,"width":757,"height":12}},{"id":"2c2855fb-c223-4177-b2d6-c88a1853e3d4","block_type":"box","text":"to a significant degree upon exports of primary commodities and, therefore, are vulnerable to changes in","page_number":130,"box":{"x":116,"y":723,"width":766,"height":12}},{"id":"8b75dcb0-7f74-46b3-a416-8fe6e3394059","block_type":"box","text":"commodity prices that, in turn, may be affected by a variety of factors.","page_number":130,"box":{"x":116,"y":738,"width":511,"height":12}},{"id":"b6f1de8f-9671-4de6-a159-2e4415269a9a","block_type":"box","text":"The legal systems in certain developing market Asia-Pacific countries also may have an adverse","page_number":130,"box":{"x":116,"y":769,"width":717,"height":12}},{"id":"a93d7676-de1c-4660-8ed4-ecf3e1b37dcd","block_type":"box","text":"impact on the Fund. For example, while the potential liability of a shareholder in a U.S. corporation with","page_number":130,"box":{"x":117,"y":785,"width":763,"height":12}},{"id":"84f2aabc-5d68-426a-bac4-15f01e737882","block_type":"box","text":"respect to acts of the corporation is generally limited to the amount of the shareholder’s investment, the","page_number":130,"box":{"x":117,"y":800,"width":766,"height":12}},{"id":"e301d448-b203-4d10-8ab3-a5065c27e936","block_type":"box","text":"notion of limited liability is less clear in certain emerging market Asia-Pacific countries. Similarly, the","page_number":130,"box":{"x":117,"y":816,"width":739,"height":12}},{"id":"6e6b9625-e2ed-4c7d-adbb-30c363f526aa","block_type":"box","text":"rights of investors in developing market Asia-Pacific companies may be more limited than those of","page_number":130,"box":{"x":117,"y":831,"width":732,"height":12}},{"id":"8aaf862b-0f7f-4c08-80a1-add8b8a287bb","block_type":"box","text":"shareholders of U.S. corporations. It may be difficult or impossible to obtain and/or enforce a judgment","page_number":130,"box":{"x":116,"y":847,"width":765,"height":12}},{"id":"12790aad-9f19-4c4a-96f5-8d03776e751b","block_type":"box","text":"in a developing market Asia-Pacific country.","page_number":130,"box":{"x":117,"y":862,"width":330,"height":12}},{"id":"05f8a1ed-7185-4da4-9ab1-d7c536d0a6e4","block_type":"box","text":"II-46","page_number":130,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"d61c2e06-44a7-432d-ae7e-feb9e1e2cb1c","block_type":"box","text":"NM0926U-5926888-130/257","page_number":130,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9e59a880-251c-41d8-8ea1-91782be9c2ef","block_type":"box","text":"Governments of many developing market Asia-Pacific countries have exercised and continue to","page_number":131,"box":{"x":117,"y":87,"width":714,"height":12}},{"id":"efec5c30-d88d-4aa9-8e15-5c4681fe5467","block_type":"box","text":"exercise substantial influence over many aspects of the private sector. In certain cases, the","page_number":131,"box":{"x":116,"y":102,"width":683,"height":13}},{"id":"6a64e512-e8f3-4026-a303-02aa6cf9087e","block_type":"box","text":"government owns or controls many companies, including the largest in the country. Accordingly,","page_number":131,"box":{"x":116,"y":118,"width":718,"height":12}},{"id":"67e56c51-1c4d-41c8-8bcc-170bd5c08c37","block_type":"box","text":"government actions in the future could have a significant effect on economic conditions in developing","page_number":131,"box":{"x":116,"y":134,"width":755,"height":12}},{"id":"d5101371-79a8-4b8b-a908-a802e08834a0","block_type":"box","text":"market Asia-Pacific countries, which could affect private sector companies and a Fund itself, as well as","page_number":131,"box":{"x":117,"y":149,"width":768,"height":12}},{"id":"39df3c7b-3b48-45ed-affb-a9a6f000ef77","block_type":"box","text":"the value of securities in the Fund’s portfolio. In addition, economic statistics of developing market","page_number":131,"box":{"x":116,"y":165,"width":731,"height":12}},{"id":"4d59cb90-4e71-41c0-b47c-0f7ce37d42f8","block_type":"box","text":"Asia-Pacific countries may be less reliable than economic statistics of more developed nations.","page_number":131,"box":{"x":116,"y":180,"width":710,"height":12}},{"id":"67556958-ecca-4b7a-bb4c-6dfd9ddf034a","block_type":"box","text":"In addition to the relative lack of publicly available information about developing market Asia-Pacific","page_number":131,"box":{"x":117,"y":211,"width":741,"height":12}},{"id":"a40e62ba-9696-4d00-87bc-dfc53f964e5c","block_type":"box","text":"issuers and the possibility that such issuers may not be subject to the same accounting, auditing and","page_number":131,"box":{"x":117,"y":227,"width":752,"height":12}},{"id":"a0ae41bc-38ce-4eed-a878-5c79e304bc4d","block_type":"box","text":"financial reporting standards as U.S. companies, inflation accounting rules in some developing market","page_number":131,"box":{"x":116,"y":242,"width":762,"height":12}},{"id":"98f7d1fd-fe39-4a68-890c-5cc8f694c6f6","block_type":"box","text":"Asia-Pacific countries require companies that keep accounting records in the local currency, for both","page_number":131,"box":{"x":116,"y":258,"width":750,"height":12}},{"id":"9bb0381d-d90c-4c7e-85ad-a5f2adc8c754","block_type":"box","text":"tax and accounting purposes, to restate certain assets and liabilities on the company’s balance sheet","page_number":131,"box":{"x":116,"y":273,"width":755,"height":12}},{"id":"7294cf5d-18f5-498f-a587-1e17ccc9580f","block_type":"box","text":"in order to express items in terms of currency of constant purchasing power. Inflation accounting may","page_number":131,"box":{"x":117,"y":289,"width":756,"height":12}},{"id":"d6e8632a-c113-4d0c-a5ef-9d5012228b30","block_type":"box","text":"indirectly generate losses or profits for certain developing market Asia-Pacific companies.","page_number":131,"box":{"x":117,"y":304,"width":669,"height":12}},{"id":"abddd370-5f91-487e-836c-9b52a9689d8a","block_type":"box","text":"Satisfactory custodial services for investment securities may not be available in some developing Asia","page_number":131,"box":{"x":116,"y":335,"width":762,"height":12}},{"id":"0992dd31-9d3d-479b-8514-87e66e903bb5","block_type":"box","text":"Pacific countries, which may result in the Fund incurring additional costs and delays in providing","page_number":131,"box":{"x":117,"y":351,"width":716,"height":12}},{"id":"582dbf94-1d1b-44b0-b14c-249d6a3ae379","block_type":"box","text":"transportation and custody services for such securities outside such countries.","page_number":131,"box":{"x":116,"y":366,"width":586,"height":12}},{"id":"e2a8a7dd-4a94-41d9-80bb-97efd59833c4","block_type":"box","text":"Certain developing Asia-Pacific countries, such as the Philippines, India and Turkey, are especially","page_number":131,"box":{"x":117,"y":397,"width":738,"height":12}},{"id":"f218cacb-87ab-4584-8ee1-986962fc0ebe","block_type":"box","text":"large debtors to commercial banks and foreign governments.","page_number":131,"box":{"x":117,"y":413,"width":456,"height":12}},{"id":"131a245c-8f16-4294-b1f7-97bd9e452850","block_type":"box","text":"Natural disasters in Asia-Pacific countries, and the resulting damage, could have a severe and","page_number":131,"box":{"x":117,"y":444,"width":705,"height":12}},{"id":"3c43c727-b756-47b6-b5c5-414696976dd4","block_type":"box","text":"negative impact on a Fund’s investment portfolio and, in the longer term, could impair the ability of","page_number":131,"box":{"x":117,"y":459,"width":732,"height":12}},{"id":"422b3f70-2f2a-4828-b584-ce3c0867374d","block_type":"box","text":"issuers in which the Fund invests to conduct their businesses in the manner normally conducted.","page_number":131,"box":{"x":117,"y":475,"width":722,"height":12}},{"id":"f15e5f05-5822-480a-8a67-1dc4b18a2df2","block_type":"box","text":"Fund management may determine that, notwithstanding otherwise favorable investment criteria, it may","page_number":131,"box":{"x":117,"y":506,"width":766,"height":12}},{"id":"49dbf904-d06c-4f24-bc82-f7f68314d9ab","block_type":"box","text":"not be practicable or appropriate to invest in a particular developing Asia-Pacific country. A Fund may","page_number":131,"box":{"x":117,"y":521,"width":757,"height":12}},{"id":"20fc0970-9b11-48aa-aab8-7dae31aa047a","block_type":"box","text":"invest in countries in which foreign investors, including management of the Fund, have had no or","page_number":131,"box":{"x":117,"y":537,"width":722,"height":12}},{"id":"00c47079-f064-4e66-97c3-6cf5a601be86","block_type":"box","text":"limited prior experience.","page_number":131,"box":{"x":117,"y":552,"width":182,"height":12}},{"id":"f3da1487-55a1-4ae6-914e-2877a0a8b567","block_type":"box","text":"Restrictions on Foreign Investments in Asia-Pacific Countries.","page_number":131,"box":{"x":116,"y":583,"width":458,"height":12}},{"id":"608cff30-1f7b-4777-9bee-776f18885a5b","block_type":"box","text":"Some developing Asia-Pacific countries","page_number":131,"box":{"x":576,"y":583,"width":305,"height":12}},{"id":"67f6a4e8-697c-4aff-adae-5ae0f2ebba26","block_type":"box","text":"prohibit or impose substantial restrictions on investments in their capital markets, particularly their","page_number":131,"box":{"x":117,"y":599,"width":728,"height":12}},{"id":"a20ac2af-a909-42fb-bb0d-a5181cfd66ca","block_type":"box","text":"equity markets, by foreign entities such as a Fund. As illustrations, certain countries may require","page_number":131,"box":{"x":116,"y":614,"width":719,"height":12}},{"id":"52da23fe-c394-4b8f-a9ad-d00cc98fb00b","block_type":"box","text":"governmental approval prior to investments by foreign persons or limit the amount of investment by","page_number":131,"box":{"x":116,"y":630,"width":741,"height":12}},{"id":"25bf9ff2-d493-4c97-aea6-245b886235d4","block_type":"box","text":"foreign persons in a particular company or limit the investment by foreign persons to only a specific","page_number":131,"box":{"x":116,"y":645,"width":740,"height":12}},{"id":"d5414010-c78f-45c7-949c-0795eab34ccd","block_type":"box","text":"class of securities of a company which may have less advantageous terms (including price and","page_number":131,"box":{"x":116,"y":661,"width":705,"height":12}},{"id":"231cd942-14e7-4bb4-8ed8-56c938a9d9f5","block_type":"box","text":"shareholder rights) than securities of the company available for purchase by nationals. There can be","page_number":131,"box":{"x":116,"y":676,"width":745,"height":12}},{"id":"f7c5795f-54de-4dd9-a28d-3624e23a4144","block_type":"box","text":"no assurance that a Fund will be able to obtain required governmental approvals in a timely manner. In","page_number":131,"box":{"x":117,"y":692,"width":762,"height":12}},{"id":"0c6a6299-d1fa-4b85-bf08-94b3515c5ad8","block_type":"box","text":"addition, changes to restrictions on foreign ownership of securities subsequent to a Fund’s purchase of","page_number":131,"box":{"x":116,"y":707,"width":765,"height":12}},{"id":"be6c4add-233c-4b24-9375-7018374c7bcb","block_type":"box","text":"such securities may have an adverse effect on the value of such shares. Certain countries may restrict","page_number":131,"box":{"x":116,"y":723,"width":761,"height":12}},{"id":"54b4cd42-bfec-4d64-9021-7198daa06ab5","block_type":"box","text":"investment opportunities in issuers or industries deemed important to national interests.","page_number":131,"box":{"x":117,"y":738,"width":647,"height":12}},{"id":"0efe57b1-f997-4494-8090-47288e219055","block_type":"box","text":"The manner in which foreign investors may invest in companies in certain developing Asia-Pacific","page_number":131,"box":{"x":116,"y":769,"width":724,"height":12}},{"id":"ceef751d-bc99-4e49-89c7-26755cc4164b","block_type":"box","text":"countries, as well as limitations on such investments, also may have an adverse impact on the","page_number":131,"box":{"x":116,"y":785,"width":700,"height":12}},{"id":"a16239ae-b05c-4f2a-bb30-2e7511a3bd6a","block_type":"box","text":"operations of a Fund. For example, a Fund may be required in certain of such countries to invest","page_number":131,"box":{"x":116,"y":800,"width":717,"height":12}},{"id":"0072df60-8cbd-4a5b-8676-eff23b1791e4","block_type":"box","text":"initially through a local broker or other entity and then have the shares purchased re-registered in the","page_number":131,"box":{"x":117,"y":816,"width":748,"height":12}},{"id":"7263b8d5-6b9e-41c8-8b7a-e371b6fabf67","block_type":"box","text":"name of the Fund. Re-registration may in some instances not be able to occur on a timely basis,","page_number":131,"box":{"x":117,"y":831,"width":718,"height":12}},{"id":"aec2a716-0df5-4dd3-b705-773372c5e784","block_type":"box","text":"resulting in a delay during which a Fund may be denied certain of its rights as an investor, including","page_number":131,"box":{"x":117,"y":847,"width":742,"height":12}},{"id":"799dbb11-5aee-4495-a745-ef7d3eec3b67","block_type":"box","text":"rights as to dividends or to be made aware of certain corporate actions. There also may be instances","page_number":131,"box":{"x":117,"y":862,"width":753,"height":12}},{"id":"61776d36-6e7f-44a5-b9ba-0f152db6634b","block_type":"box","text":"where a Fund places a purchase order but is subsequently informed, at the time of re-registration, that","page_number":131,"box":{"x":116,"y":878,"width":764,"height":12}},{"id":"de9e3ae1-7283-4cca-80ca-9e9b0c3a37db","block_type":"box","text":"II-47","page_number":131,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"291582a3-3317-48eb-966e-60d5a54d5e82","block_type":"box","text":"NM0926U-5926888-131/257","page_number":131,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"1a1c2804-4f0a-4748-a019-85a72a80b553","block_type":"box","text":"the permissible allocation of the investment to foreign investors has been filled, depriving the Fund of","page_number":132,"box":{"x":116,"y":87,"width":754,"height":12}},{"id":"4ae4613e-76ab-4b5a-9e4c-64ceb0af2728","block_type":"box","text":"the ability to make its desired investment at that time.","page_number":132,"box":{"x":116,"y":103,"width":400,"height":12}},{"id":"de208578-8932-433a-9743-a44e6acca6e3","block_type":"box","text":"Substantial limitations may exist in certain countries with respect to a Fund’s ability to repatriate","page_number":132,"box":{"x":116,"y":131,"width":714,"height":12}},{"id":"9246f0ff-9027-41cb-a6cf-0aa14a0f4172","block_type":"box","text":"investment income, capital or the proceeds of sales of securities by foreign investors. A Fund could be","page_number":132,"box":{"x":117,"y":146,"width":763,"height":12}},{"id":"1d62650c-75e3-4d29-aedd-821c7e445289","block_type":"box","text":"adversely affected by delays in, or a refusal to grant, any required governmental approval for","page_number":132,"box":{"x":116,"y":162,"width":693,"height":12}},{"id":"ea2c3bd3-3c01-41b9-803b-9c1bb323edcc","block_type":"box","text":"repatriation of capital, as well as by the application to the Fund of any restrictions on investments. It is","page_number":132,"box":{"x":117,"y":177,"width":759,"height":12}},{"id":"8f3a5df6-3c6f-4746-b22d-f67331b9066e","block_type":"box","text":"possible that certain countries may impose currency controls or other restrictions relating to their","page_number":132,"box":{"x":117,"y":193,"width":719,"height":12}},{"id":"90760336-8dbd-4adc-90f6-1b9d95132198","block_type":"box","text":"currencies or to securities of issuers in those countries. To the extent that such restrictions have the","page_number":132,"box":{"x":116,"y":208,"width":746,"height":10}},{"id":"18c2f766-fe48-440d-98ce-98ee5f0b191a","block_type":"box","text":"effect of making certain investments illiquid, securities may not be available for sale to meet","page_number":132,"box":{"x":116,"y":224,"width":685,"height":12}},{"id":"da239782-99df-46f4-818f-55ce1516ed78","block_type":"box","text":"redemptions. Depending on a variety of financial factors, the percentage of a Fund’s portfolio subject to","page_number":132,"box":{"x":117,"y":239,"width":770,"height":12}},{"id":"43872cd1-f76a-43db-bda5-fafdac907f52","block_type":"box","text":"currency controls may increase. In the event other countries impose similar controls, the portion of the","page_number":132,"box":{"x":116,"y":255,"width":763,"height":12}},{"id":"b8f8c54d-7733-44c0-9e70-3cae5ae233b0","block_type":"box","text":"Fund’s assets that may be used to meet redemptions may be further decreased. Even where there is","page_number":132,"box":{"x":117,"y":270,"width":754,"height":12}},{"id":"c58860c3-cec8-4fae-9732-4de17569a41e","block_type":"box","text":"no outright restriction on repatriation of capital, the mechanics of repatriation may affect certain aspects","page_number":132,"box":{"x":117,"y":286,"width":771,"height":12}},{"id":"ee42f389-82ce-4b27-bc46-ea1fadddcaf4","block_type":"box","text":"of the operations of a Fund (for example, if funds may be withdrawn only in certain currencies and/or","page_number":132,"box":{"x":116,"y":301,"width":751,"height":13}},{"id":"f55f386e-1167-4a87-a037-6ec64d513011","block_type":"box","text":"only at an exchange rate established by the government).","page_number":132,"box":{"x":116,"y":317,"width":433,"height":12}},{"id":"c33d290d-712b-45c3-8862-a3c346c3751e","block_type":"box","text":"In certain countries, banks or other financial institutions may be among the leading companies or have","page_number":132,"box":{"x":117,"y":345,"width":763,"height":12}},{"id":"02e62bef-d371-4009-941a-2d7e07c9e9ce","block_type":"box","text":"actively traded securities available for investment. The Investment Company Act restricts a Fund’s","page_number":132,"box":{"x":116,"y":361,"width":734,"height":12}},{"id":"aa5b43b9-de0c-4020-80f5-c2e89ec64721","block_type":"box","text":"investments in any equity securities of an issuer that, in its most recent fiscal year, derived more than","page_number":132,"box":{"x":117,"y":376,"width":755,"height":12}},{"id":"48989e98-3304-4240-bd5d-b369fb2b7c39","block_type":"box","text":"15% of its revenues from “securities related activities,” as defined by the rules thereunder. These","page_number":132,"box":{"x":118,"y":392,"width":722,"height":12}},{"id":"0d56fa12-8d75-46d1-b376-e693f9cf6ab2","block_type":"box","text":"provisions may restrict a Fund’s investments in certain foreign banks and other financial institutions.","page_number":132,"box":{"x":117,"y":407,"width":744,"height":12}},{"id":"b8a76e8c-bbe1-473e-8c19-579f4fd98d5a","block_type":"box","text":"Political and economic structures in emerging market countries may be undergoing significant","page_number":132,"box":{"x":117,"y":436,"width":699,"height":12}},{"id":"32a28eb8-dcc5-4c55-a7f7-efd1599e3836","block_type":"box","text":"evolution and rapid development, and these countries may lack the social, political and economic","page_number":132,"box":{"x":116,"y":451,"width":726,"height":12}},{"id":"71bf7513-60ab-4759-a9ae-98ae769acd34","block_type":"box","text":"stability characteristic of more developed countries. Some of these countries may have in the past","page_number":132,"box":{"x":116,"y":467,"width":732,"height":12}},{"id":"8084d03f-7cd5-4115-8868-ec93610a0511","block_type":"box","text":"failed to recognize private property rights and have at times nationalized or expropriated the assets of","page_number":132,"box":{"x":116,"y":482,"width":759,"height":12}},{"id":"3a4de126-c1c6-446d-a8ec-579d9aa3d33c","block_type":"box","text":"private companies. As a result the risks described above, including the risks of nationalization or","page_number":132,"box":{"x":117,"y":498,"width":718,"height":12}},{"id":"53c66fc9-1e0c-44ac-b94f-8ece77392fa3","block_type":"box","text":"expropriation of assets, may be heightened. 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The small size and inexperience of the securities markets in","page_number":132,"box":{"x":117,"y":544,"width":770,"height":12}},{"id":"f98928c2-e4b3-49f2-a3e3-734ad55d2cfb","block_type":"box","text":"certain of these countries and the limited volume of trading in securities in these countries may make","page_number":132,"box":{"x":116,"y":560,"width":753,"height":12}},{"id":"c9386108-00a7-4ebf-8e7f-8878462f51f0","block_type":"box","text":"investments in the countries illiquid and more volatile than investments in Japan or most Western","page_number":132,"box":{"x":117,"y":575,"width":725,"height":12}},{"id":"b9c86bf0-0583-4b44-bb6e-428038acd611","block_type":"box","text":"European countries. There may be little financial or accounting information available with respect to","page_number":132,"box":{"x":117,"y":591,"width":741,"height":12}},{"id":"116e5fd2-f451-40a2-9957-53cf96538160","block_type":"box","text":"issuers located in certain emerging market countries, and it may be difficult to assess the value or","page_number":132,"box":{"x":117,"y":606,"width":729,"height":12}},{"id":"ef540f24-94b9-4a8f-ade3-fb1eccf9723e","block_type":"box","text":"prospects of an investment in such issuers.","page_number":132,"box":{"x":117,"y":622,"width":325,"height":12}},{"id":"37fb69e8-1a0b-4ada-a6a5-3a3eb7279bd0","block_type":"box","text":"The expense ratios of the Funds investing significantly in foreign securities can be expected to be","page_number":132,"box":{"x":116,"y":650,"width":728,"height":12}},{"id":"0612d3be-194b-4dc8-bac2-2b8ea88660ff","block_type":"box","text":"higher than those of Funds investing primarily in domestic securities. 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The Russian securities market suffers from a variety of problems","page_number":132,"box":{"x":116,"y":756,"width":704,"height":12}},{"id":"33d1a65a-079c-45e6-9b18-d2905b12d37f","block_type":"box","text":"described above in “Investment in Emerging Markets” not encountered in more developed markets.","page_number":132,"box":{"x":116,"y":771,"width":736,"height":13}},{"id":"2578a5b6-46c4-4662-90e1-46e8a2ca12be","block_type":"box","text":"The Russian securities market is relatively new, and a substantial portion of securities transactions in","page_number":132,"box":{"x":116,"y":787,"width":749,"height":12}},{"id":"7088f6b1-a98e-43d8-a067-99562b9506c3","block_type":"box","text":"Russia are privately negotiated outside of stock exchanges. The inexperience of the Russian securities","page_number":132,"box":{"x":117,"y":802,"width":763,"height":13}},{"id":"cc72dae1-b226-495f-b1c0-33c4cae7f78e","block_type":"box","text":"market and the limited volume of trading in securities in the market may make obtaining accurate","page_number":132,"box":{"x":117,"y":818,"width":718,"height":12}},{"id":"56b43aa7-5488-4063-a045-645452114ff1","block_type":"box","text":"prices on portfolio securities from independent sources more difficult than in more developed markets.","page_number":132,"box":{"x":117,"y":833,"width":761,"height":12}},{"id":"0e89517c-57db-45c9-b0a7-2b2dcdf78c56","block_type":"box","text":"Because of the underdeveloped state of Russia’s se","page_number":132,"box":{"x":117,"y":862,"width":378,"height":12}},{"id":"d9bdeacf-3828-42b8-a179-11160799c60c","block_type":"box","text":"curities markets and banking and telecommunication","page_number":132,"box":{"x":496,"y":862,"width":388,"height":12}},{"id":"d95a6711-4d8a-45e1-9eb1-34d1612d1229","block_type":"box","text":"systems, settlement, clearing and registration of securi","page_number":132,"box":{"x":116,"y":877,"width":396,"height":12}},{"id":"5b979316-ed34-470b-9f41-53b3ae359048","block_type":"box","text":"ties transactions are subject to additional risks.","page_number":132,"box":{"x":513,"y":877,"width":344,"height":12}},{"id":"d88cb7cb-a0dd-4ecd-95c1-ca2806d692b2","block_type":"box","text":"II-48","page_number":132,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"43769f87-c195-4697-be47-9e652c8ed560","block_type":"box","text":"NM0926U-5926888-132/257","page_number":132,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"21410780-2f9e-4315-83ad-eb1189ed45d0","block_type":"box","text":"Prior to 2013, there was no central registration","page_number":133,"box":{"x":117,"y":87,"width":341,"height":12}},{"id":"a5bb7142-c4f3-46ab-aa6c-9a0d32ec73b1","block_type":"box","text":"system for equity share registration in Russia and","page_number":133,"box":{"x":458,"y":87,"width":365,"height":12}},{"id":"91054c1b-c41f-4cdd-a96a-b91a5a5e3411","block_type":"box","text":"registration was carried out either by the issuers them","page_number":133,"box":{"x":117,"y":103,"width":388,"height":12}},{"id":"e9ac05a8-19da-4608-b19b-85155c6cc41d","block_type":"box","text":"selves or by registrars located throughout Russia.","page_number":133,"box":{"x":507,"y":103,"width":365,"height":12}},{"id":"14430ae7-d042-437a-a7dd-0698c3f58e76","block_type":"box","text":"These registrars may not have been subject to effective state supervision or licensed with any","page_number":133,"box":{"x":116,"y":118,"width":686,"height":12}},{"id":"345f142b-5246-4b7e-b3f9-25b65c1c0dc7","block_type":"box","text":"governmental entity. 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Alt","page_number":133,"box":{"x":499,"y":165,"width":162,"height":12}},{"id":"42c091d0-ce6d-4e8f-989c-cc2d6604236a","block_type":"box","text":"hough the implementation of","page_number":133,"box":{"x":662,"y":165,"width":211,"height":12}},{"id":"f8250db5-f1cc-42c4-b5af-f64f8a91cd58","block_type":"box","text":"the NSD has enhanced the efficiency and transparency of the Russian securities market, loss still can","page_number":133,"box":{"x":116,"y":180,"width":743,"height":12}},{"id":"fcd91d26-2d9c-47d4-96d0-6ffa89bec09a","block_type":"box","text":"occur. Additionally, issuers and registrars remain","page_number":133,"box":{"x":116,"y":196,"width":353,"height":12}},{"id":"5cfec77f-beb5-4f14-ba6b-b6d23018a400","block_type":"box","text":"prominent in the validation and approval of","page_number":133,"box":{"x":470,"y":196,"width":320,"height":11}},{"id":"94f55c12-043b-4efe-9db5-3e0c5c341970","block_type":"box","text":"documentation requirements for corporate action pr","page_number":133,"box":{"x":116,"y":211,"width":374,"height":12}},{"id":"ac05599a-ecec-463b-8357-bff4da4065b2","block_type":"box","text":"ocessing in Russia, and, because the documentation","page_number":133,"box":{"x":491,"y":211,"width":389,"height":12}},{"id":"0d20bb46-2723-4c2f-aab1-9c748f965528","block_type":"box","text":"requirements and approval criteria vary between registra","page_number":133,"box":{"x":117,"y":227,"width":410,"height":12}},{"id":"7fbefed4-c5d6-4333-bb0a-e905c2267936","block_type":"box","text":"rs and issuers, there remain inconsistent market","page_number":133,"box":{"x":528,"y":227,"width":354,"height":11}},{"id":"6a60cca0-9c6b-4085-98f5-876cb00a0b81","block_type":"box","text":"standards in the Russian market with respect to t","page_number":133,"box":{"x":116,"y":242,"width":351,"height":12}},{"id":"cb9ffe13-2ce8-4893-8eda-2cabc344d3f6","block_type":"box","text":"the completion and submission of corporate action","page_number":133,"box":{"x":467,"y":242,"width":372,"height":12}},{"id":"c32d9304-0e99-49ec-a851-b28e1c028625","block_type":"box","text":"elections. 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Russia","page_number":133,"box":{"x":117,"y":366,"width":735,"height":12}},{"id":"ee81411a-97fb-4a08-8745-9189c1e771bd","block_type":"box","text":"launched a large-scale invasion of Ukraine on February 24, 2022. The extent and duration of the","page_number":133,"box":{"x":117,"y":382,"width":720,"height":12}},{"id":"cdbf2e1e-b997-4318-949a-69774b81d878","block_type":"box","text":"military action, resulting sanctions and resulting future market disruptions, including declines in its","page_number":133,"box":{"x":117,"y":397,"width":727,"height":12}},{"id":"41655dbd-533c-449f-a553-d3e54951fadf","block_type":"box","text":"stock markets and the value of the ruble against the U.S. dollar, are impossible to predict. 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Actual and threatened responses to such","page_number":133,"box":{"x":117,"y":537,"width":726,"height":12}},{"id":"965a360b-463d-4f28-ad60-e7066cd262e8","block_type":"box","text":"military action may also impact the markets for certain Russian commodities, such as oil and natural","page_number":133,"box":{"x":117,"y":552,"width":747,"height":12}},{"id":"afaa60d9-1585-4527-b9e4-8351e0f05763","block_type":"box","text":"gas, as well as other sectors of the Russian economy, and may likely have collateral impacts on such","page_number":133,"box":{"x":116,"y":568,"width":758,"height":12}},{"id":"dffd73d3-e764-4222-babd-90cd865eb8b6","block_type":"box","text":"sectors globally.","page_number":133,"box":{"x":116,"y":583,"width":125,"height":12}},{"id":"1e80dc9b-69a2-4255-ad22-a1542923b3df","block_type":"box","text":"Governments in the United States and many other countries (collectively, the “Sanctioning Bodies”)","page_number":133,"box":{"x":117,"y":614,"width":741,"height":12}},{"id":"b832ab10-f384-480b-8896-56f44d338755","block_type":"box","text":"have imposed economic sanctions, which can consist of prohibiting certain securities trades, certain","page_number":133,"box":{"x":117,"y":630,"width":745,"height":12}},{"id":"ca2925e4-8568-42cc-b71f-f2260b70b5da","block_type":"box","text":"private transactions in the energy sector, asset freezes and prohibition of all business, against certain","page_number":133,"box":{"x":117,"y":645,"width":757,"height":12}},{"id":"0e511b9b-5d60-4275-b9d8-c5c0211e631d","block_type":"box","text":"Russian individuals, including politicians, and Russian corporate and banking entities. 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Such ability could be restricted or revoked by the Saudi Arabian","page_number":133,"box":{"x":116,"y":831,"width":757,"height":12}},{"id":"29400efb-fdca-4e60-91db-28c36282e099","block_type":"box","text":"government at any time, and unforeseen risks could materialize due to foreign ownership in such","page_number":133,"box":{"x":116,"y":847,"width":724,"height":12}},{"id":"4aaf2430-01f1-4068-bd0c-b77c0c9482f9","block_type":"box","text":"securities. In addition, the Capital Market Authority (“CMA”) places investment limitations on the","page_number":133,"box":{"x":116,"y":862,"width":715,"height":12}},{"id":"3da67f8d-2ef2-437a-96f9-1cd00829721b","block_type":"box","text":"ownership of Saudi Arabian issuers by foreign investors, including a limitation on a Fund’s ownership","page_number":133,"box":{"x":116,"y":878,"width":753,"height":12}},{"id":"7adcd55e-eb35-4eb7-bb89-0d9cb51856e0","block_type":"box","text":"II-49","page_number":133,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"6ad6133c-4045-4d1a-ad30-9b549023fb12","block_type":"box","text":"NM0926U-5926888-133/257","page_number":133,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"0522b71a-1303-48ab-8f70-b6c1b62dd5e9","block_type":"box","text":"of any single issuer listed on the Saudi Arabian Stock Exchange, which may prevent a Fund from","page_number":134,"box":{"x":116,"y":87,"width":726,"height":12}},{"id":"cf6fb69f-f43e-4fa5-b7e9-d74f224360f1","block_type":"box","text":"investing in accordance with its strategy and contribute to tracking error against the Underlying Index.","page_number":134,"box":{"x":117,"y":103,"width":757,"height":12}},{"id":"706c055d-7803-4b61-ae88-83b88cd79b5d","block_type":"box","text":"These restrictions may be changed or new restrictions, such as licensing requirements, special","page_number":134,"box":{"x":116,"y":118,"width":710,"height":12}},{"id":"30230389-72da-4929-ade6-b82251503233","block_type":"box","text":"approvals or additional foreign taxes, may be instituted at any time. A Fund may not be able to obtain","page_number":134,"box":{"x":116,"y":134,"width":756,"height":12}},{"id":"f968e55d-6a2e-4977-b524-6016108071df","block_type":"box","text":"or maintain any such licenses or approvals and may not be able to buy and sell securities at full value.","page_number":134,"box":{"x":116,"y":149,"width":763,"height":12}},{"id":"b313dab1-d9e7-4d88-bfb6-47aad10614fc","block_type":"box","text":"Major disruptions or regulatory changes could occur in the Saudi Arabian market, any of which could","page_number":134,"box":{"x":117,"y":165,"width":750,"height":12}},{"id":"fe353f2e-3e8c-4b2b-9e65-191eef3a8fcd","block_type":"box","text":"negatively impact a Fund. These risks may be exacerbated, compared to more developed markets,","page_number":134,"box":{"x":117,"y":180,"width":741,"height":12}},{"id":"08875090-6acd-4e74-a49e-b8e221c2fc5a","block_type":"box","text":"given the limited history of foreign investment in the Saudi Arabian market. Investments in Saudi","page_number":134,"box":{"x":116,"y":196,"width":719,"height":12}},{"id":"b9ee030e-65a2-41b9-a985-150e01d41aa2","block_type":"box","text":"Arabia may also be subject to loss due to expropriation or nationalization of assets and property or the","page_number":134,"box":{"x":116,"y":211,"width":764,"height":12}},{"id":"e1502a1b-0f7e-451a-9388-f361553376d2","block_type":"box","text":"imposition of restrictions on additional foreign investments and repatriation of capital. Such heightened","page_number":134,"box":{"x":117,"y":227,"width":764,"height":12}},{"id":"69e95d39-2749-4638-999f-0720ffb30481","block_type":"box","text":"risks may include, among others, restrictions on and government intervention in international trade,","page_number":134,"box":{"x":117,"y":242,"width":739,"height":12}},{"id":"42139f1f-e335-4590-a9da-1f2784f7da84","block_type":"box","text":"confiscatory taxation, political instability, including authoritarian and/or military involvement in","page_number":134,"box":{"x":116,"y":258,"width":694,"height":12}},{"id":"b7b306f8-bc97-4f6b-a4a0-2369f0414a53","block_type":"box","text":"governmental decision making, armed conflict, crime and instability as a result of religious, ethnic and/","page_number":134,"box":{"x":116,"y":273,"width":758,"height":12}},{"id":"dbc48ed7-0401-4019-83e9-511ced93290f","block_type":"box","text":"or socioeconomic unrest. Saudi Arabia has privatized, or has begun the process of privatizing, certain","page_number":134,"box":{"x":116,"y":289,"width":759,"height":12}},{"id":"72b48d70-5ca3-44dd-bf1e-78ec7785b1e5","block_type":"box","text":"entities and industries. Newly privatized companies may face strong competition from government","page_number":134,"box":{"x":116,"y":304,"width":733,"height":12}},{"id":"51aafafc-6e4b-4db4-8877-18d95fdb0a9a","block_type":"box","text":"sponsored competitors that have not been privatized. In some instances, investors in newly privatized","page_number":134,"box":{"x":116,"y":320,"width":760,"height":12}},{"id":"2859db7c-d1ba-4718-b4d1-19249c5c45f0","block_type":"box","text":"entities have suffered losses due to the inability of the newly privatized entities to adjust quickly to a","page_number":134,"box":{"x":116,"y":335,"width":744,"height":12}},{"id":"4bea403c-e656-48a9-baf6-047ca4926a9f","block_type":"box","text":"competitive environment or changing regulatory and legal standards or, in some cases, due to","page_number":134,"box":{"x":116,"y":351,"width":703,"height":12}},{"id":"cdb3bdc9-dc4e-42b8-b4a1-344cd2d09e05","block_type":"box","text":"re-nationalization of such privatized entities. There is no assurance that similar losses will not recur.","page_number":134,"box":{"x":117,"y":366,"width":743,"height":12}},{"id":"895ea71c-bf89-4907-aa0f-b2bbcad5dfdf","block_type":"box","text":"Further, under income tax laws imposed by the Department of Zakat and Income Tax, dividends paid","page_number":134,"box":{"x":117,"y":382,"width":754,"height":12}},{"id":"5b3db0bb-d13e-4ccc-a958-a5ed32536fb7","block_type":"box","text":"by a Saudi Arabian company to foreign stockholders are generally subject to a 5% withholding tax","page_number":134,"box":{"x":117,"y":397,"width":730,"height":12}},{"id":"2eabff37-c740-4f06-8dee-07527a59e985","block_type":"box","text":"(different tax rates may apply pursuant to an applicable treaty). Saudi Arabia is highly reliant on income","page_number":134,"box":{"x":117,"y":413,"width":770,"height":12}},{"id":"88cbd203-e294-4e60-af6e-fdb9b8447fe3","block_type":"box","text":"from the sale of petroleum and trade with other countries involved in the sale of petroleum, and its","page_number":134,"box":{"x":116,"y":428,"width":732,"height":12}},{"id":"7aab9636-6e02-4fc9-bcf5-70ddbe945755","block_type":"box","text":"economy is therefore vulnerable to changes in foreign currency values and the market for petroleum.","page_number":134,"box":{"x":116,"y":444,"width":753,"height":12}},{"id":"05813846-00fc-4df2-8ab2-2527087d3e53","block_type":"box","text":"As global demand for petroleum fluctuates, Saudi Arabia may be significantly impacted.","page_number":134,"box":{"x":116,"y":459,"width":655,"height":12}},{"id":"5af71d8b-d575-4399-9d5e-8b1d84f6c51b","block_type":"box","text":"Like most Middle Eastern governments, the government of Saudi Arabia exercises substantial","page_number":134,"box":{"x":117,"y":490,"width":701,"height":12}},{"id":"897f76fa-57d3-4d7e-adfb-7b0544b05020","block_type":"box","text":"influence over many aspects of the private sector. Although liberalization in the wider economy is","page_number":134,"box":{"x":117,"y":506,"width":724,"height":12}},{"id":"b7cb35b6-2f8d-4e64-aedf-eb882c5743ff","block_type":"box","text":"underway, in many areas it has lagged significantly: restrictions on foreign ownership persist, and the","page_number":134,"box":{"x":117,"y":521,"width":755,"height":12}},{"id":"570022c1-cc03-495f-940c-22d770e4afdb","block_type":"box","text":"government has an ownership stake in many key industries. The situation is exacerbated by the fact","page_number":134,"box":{"x":116,"y":537,"width":748,"height":12}},{"id":"70f44daf-9cba-4c3d-a3f2-1ef1e0dd0a72","block_type":"box","text":"that Saudi Arabia is governed by an absolute monarchy. Saudi Arabia has historically experienced","page_number":134,"box":{"x":116,"y":552,"width":735,"height":12}},{"id":"49777043-886a-4d2f-af85-c66819140e57","block_type":"box","text":"strained relations with economic partners worldwide, including other countries in the Middle East due to","page_number":134,"box":{"x":116,"y":568,"width":771,"height":12}},{"id":"1b04f177-6575-4731-9506-b6aa603894cb","block_type":"box","text":"geopolitical events. Incidents involving a Middle Eastern country’s or the region’s security, including","page_number":134,"box":{"x":116,"y":583,"width":742,"height":12}},{"id":"c9892b11-a41a-4dde-9d35-8879c6effe0f","block_type":"box","text":"terrorism, may cause uncertainty in their markets and may adversely affect its economy and a Fund’s","page_number":134,"box":{"x":116,"y":599,"width":757,"height":12}},{"id":"fbabea15-2e39-4129-8419-53ccc2ae3b4d","block_type":"box","text":"investments. Governmental actions in the future could have a significant effect on economic conditions","page_number":134,"box":{"x":117,"y":614,"width":766,"height":12}},{"id":"ce2fe1e4-c913-42b0-bdaa-63a86ebafdd1","block_type":"box","text":"in Saudi Arabia, which could affect private sector companies and a Fund, as well as the value of","page_number":134,"box":{"x":117,"y":630,"width":717,"height":12}},{"id":"6667d123-172e-4cb4-849b-e692601e9078","block_type":"box","text":"securities in a Fund’s portfolio. Any economic sanctions on Saudi Arabian individuals or Saudi Arabian","page_number":134,"box":{"x":116,"y":645,"width":765,"height":12}},{"id":"3efdce6a-b540-4819-aa2f-545a09fa6ce3","block_type":"box","text":"corporate entities, or even the threat of sanctions, may result in the decline of the value and liquidity of","page_number":134,"box":{"x":116,"y":661,"width":760,"height":12}},{"id":"43718ad3-48ca-4eb6-bedc-90231bb0a4c1","block_type":"box","text":"Saudi Arabian securities, a weakening of the Saudi riyal or other adverse consequences to the Saudi","page_number":134,"box":{"x":116,"y":676,"width":749,"height":12}},{"id":"d5198d48-e5d5-4555-bcba-334b66e48f2c","block_type":"box","text":"Arabian economy. In addition, Saudi Arabia’s economy relies heavily on cheap, foreign labor, and","page_number":134,"box":{"x":116,"y":692,"width":723,"height":12}},{"id":"1f6741db-d315-421b-9bfc-c24492d97862","block_type":"box","text":"changes in the availability of this labor supply could have an adverse effect on the economy.","page_number":134,"box":{"x":116,"y":707,"width":684,"height":12}},{"id":"e7a26518-5f75-4ad7-9241-010f718a2546","block_type":"box","text":"The securities markets in Saudi Arabia may not be as developed as those in other countries. As a","page_number":134,"box":{"x":116,"y":738,"width":725,"height":12}},{"id":"95347c46-00d7-4525-81e0-09f115a640e5","block_type":"box","text":"result, securities markets in Saudi Arabia are subject to greater risks associated with market volatility,","page_number":134,"box":{"x":117,"y":754,"width":751,"height":12}},{"id":"2bcbea78-8c4f-46d9-869f-0b8b6f752514","block_type":"box","text":"lower market capitalization, lower trading volume, illiquidity, inflation, greater price fluctuations,","page_number":134,"box":{"x":117,"y":769,"width":699,"height":12}},{"id":"1b5aa021-f37b-4ae9-be45-85ed73c97526","block_type":"box","text":"uncertainty regarding the existence of trading markets, governmental control and heavy regulation of","page_number":134,"box":{"x":117,"y":785,"width":747,"height":12}},{"id":"9751e51e-30e8-4ad2-850b-be89cd971906","block_type":"box","text":"labor and industry. Shares of certain Saudi Arabian companies tend to trade less frequently than those","page_number":134,"box":{"x":117,"y":800,"width":761,"height":12}},{"id":"efa7ae22-61fe-4cf6-a4ff-d216981f3ea4","block_type":"box","text":"of companies on exchanges in more developed markets. Such infrequent trading may adversely affect","page_number":134,"box":{"x":116,"y":816,"width":759,"height":12}},{"id":"79364684-7097-42ee-ad13-1e79e0b908ac","block_type":"box","text":"the pricing of these securities and a Fund’s ability to sell these securities in the future. Current","page_number":134,"box":{"x":116,"y":831,"width":701,"height":12}},{"id":"9700d7dc-f4d6-4ecb-89bc-2cf51423b142","block_type":"box","text":"regulations in Saudi Arabian markets may require a Fund to execute trades of securities through a","page_number":134,"box":{"x":117,"y":847,"width":733,"height":12}},{"id":"3cf9d702-9020-4494-958f-f6e0776b6d5c","block_type":"box","text":"single broker. As a result, the Manager will have less flexibility to choose among brokers on behalf of a","page_number":134,"box":{"x":116,"y":862,"width":767,"height":12}},{"id":"9b334686-d5ea-49bf-a2c5-0f036e2e2cb2","block_type":"box","text":"Fund than is typically the case for investment managers.","page_number":134,"box":{"x":117,"y":878,"width":424,"height":12}},{"id":"47385e18-5eb6-4eb0-a1fb-40bc9298b788","block_type":"box","text":"II-50","page_number":134,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"addfe032-db8f-4063-a1d6-4587dc4063be","block_type":"box","text":"NM0926U-5926888-134/257","page_number":134,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"176f0e5b-6b3f-478a-93a1-6ed5d8d224a5","block_type":"box","text":"Although the political situation in Saudi Arabia is largely stable, Saudi Arabia has historically","page_number":135,"box":{"x":116,"y":87,"width":687,"height":12}},{"id":"043dd1f0-12ff-44bb-a1b5-3aae7f80de0d","block_type":"box","text":"experienced political instability, and there remains the possibility that the stability will not hold in the","page_number":135,"box":{"x":116,"y":103,"width":741,"height":12}},{"id":"06bf7d03-a38b-448f-b8b3-d2e74a5cd8c5","block_type":"box","text":"future or that instability in the larger Middle East region could adversely impact the economy of Saudi","page_number":135,"box":{"x":116,"y":118,"width":755,"height":12}},{"id":"4f5914a3-9223-45c3-b335-4faca001aa84","block_type":"box","text":"Arabia. Instability may be caused by military developments, government interventions in the","page_number":135,"box":{"x":116,"y":134,"width":686,"height":12}},{"id":"7b3de5ce-9190-495a-85b4-629b765d9a5d","block_type":"box","text":"marketplace, terrorism, extremist attitudes, attempted social or political reforms, religious differences,","page_number":135,"box":{"x":117,"y":149,"width":755,"height":12}},{"id":"882dd932-9bdf-4c91-8877-9d6efc16acbe","block_type":"box","text":"or other factors. Additionally, anti-Western views held by certain groups in the Middle East may","page_number":135,"box":{"x":116,"y":165,"width":710,"height":12}},{"id":"f608144d-a01d-431e-bf48-da4cf0d9eb49","block_type":"box","text":"influence government policies regarding foreign investment. Further developments in U.S. relations","page_number":135,"box":{"x":117,"y":180,"width":740,"height":12}},{"id":"712943ed-08ed-4e22-b213-b36487071b3e","block_type":"box","text":"with Saudi Arabia and other Middle-Eastern countries may affect these attitudes and policies. The U.S.","page_number":135,"box":{"x":116,"y":196,"width":768,"height":12}},{"id":"88bc1897-8de6-4cc9-8439-7164721964b6","block_type":"box","text":"is a significant, and in some cases the most significant, trading partner of, or foreign investor in, Saudi","page_number":135,"box":{"x":117,"y":211,"width":760,"height":12}},{"id":"b23c49a8-3260-4a57-9ebb-627431e2b567","block_type":"box","text":"Arabia. As a result, economic conditions of Saudi Arabia may be particularly affected by changes in the","page_number":135,"box":{"x":116,"y":227,"width":771,"height":12}},{"id":"6d7fed6c-9209-44fb-9daf-17435738bbf5","block_type":"box","text":"U.S. economy. A decrease in U.S. imports or exports, new trade and financial regulations or tariffs,","page_number":135,"box":{"x":117,"y":242,"width":738,"height":12}},{"id":"1d5bdd14-c9a2-4922-bfa6-d6cdf85b678c","block_type":"box","text":"changes in the U.S. dollar exchange rate or an economic slowdown in the U.S. may have a material","page_number":135,"box":{"x":116,"y":258,"width":746,"height":12}},{"id":"d51c3ec5-8e20-49b7-a456-d994564fcfc1","block_type":"box","text":"adverse effect on the economic conditions of Saudi Arabia and, as a result, securities to which the","page_number":135,"box":{"x":116,"y":273,"width":733,"height":11}},{"id":"bafc1aad-516a-4126-8503-5d3cfce928de","block_type":"box","text":"Fund has exposure. Political instability in North Africa and the larger Middle East region has caused","page_number":135,"box":{"x":117,"y":289,"width":743,"height":12}},{"id":"8ab1d39e-ae1a-4f53-a85d-99025cb58886","block_type":"box","text":"significant disruptions to many industries. Continued political and social unrest in these areas may","page_number":135,"box":{"x":116,"y":304,"width":732,"height":12}},{"id":"072b0346-8294-44d8-8051-61ea153a6ed5","block_type":"box","text":"negatively affect the value of securities in a Fund’s portfolio.","page_number":135,"box":{"x":117,"y":320,"width":449,"height":12}},{"id":"aeee5c6a-99de-49cb-99d8-6ca55356ee4f","block_type":"box","text":"Certain issuers located in Saudi Arabia may operate in, or have dealings with, countries subject to","page_number":135,"box":{"x":117,"y":351,"width":731,"height":12}},{"id":"4a23a1b6-9fc4-4c55-942d-83afe60cf248","block_type":"box","text":"sanctions and/or embargoes imposed by the U.S. Government and the United Nations and/or countries","page_number":135,"box":{"x":116,"y":366,"width":772,"height":12}},{"id":"eaf33797-9ee7-4bbb-93de-7abc0f46c251","block_type":"box","text":"identified by the U.S. Government as state sponsors of terrorism. As a result, an issuer may sustain","page_number":135,"box":{"x":117,"y":382,"width":744,"height":12}},{"id":"774fd1e2-7688-46bf-acff-2e8bf7b1ae3f","block_type":"box","text":"damage to its reputation if it is identified as an issuer which operates in, or has dealings with, such","page_number":135,"box":{"x":116,"y":397,"width":734,"height":12}},{"id":"953aedc8-6bd7-47f5-94fa-116ad6864730","block_type":"box","text":"countries. A Fund, as an investor in such issuers will be indirectly subject to those risks.","page_number":135,"box":{"x":116,"y":413,"width":655,"height":12}},{"id":"4456c347-e3cd-4ad9-ad3b-766768307811","block_type":"box","text":"Risks of Investing in Venezuela.","page_number":135,"box":{"x":116,"y":444,"width":237,"height":12}},{"id":"d9beefa3-51a6-4e9d-9af6-cadd44119bc1","block_type":"box","text":"Investment in Venezuela may subject a Fund to legal, regulatory,","page_number":135,"box":{"x":354,"y":444,"width":493,"height":12}},{"id":"c439edf7-77b9-4204-a685-1ef90e64660e","block_type":"box","text":"political, currency, security, expropriation and/or nationalization of assets and economic risk specific to","page_number":135,"box":{"x":117,"y":459,"width":764,"height":12}},{"id":"bc930de8-3d4a-4f80-ade5-1ea53111e7f8","block_type":"box","text":"Venezuela. Venezuela is extremely well endowed with natural resources, including oil and natural gas,","page_number":135,"box":{"x":116,"y":475,"width":765,"height":12}},{"id":"fa36ee9d-6a20-4561-9173-a530b4c2425c","block_type":"box","text":"and its economy is heavily dependent on export of natural resources to key trading partners. Any act of","page_number":135,"box":{"x":116,"y":490,"width":770,"height":12}},{"id":"bdb84e73-a098-4e47-8de0-be9d0071dd4c","block_type":"box","text":"terrorism, an armed conflict or a breakdown of a key trading relationship that disrupts the production or","page_number":135,"box":{"x":116,"y":506,"width":767,"height":12}},{"id":"0a4891de-723d-46ff-9c49-eacd861a67f7","block_type":"box","text":"export of natural resources will likely negatively affect the Venezuelan economy. The government","page_number":135,"box":{"x":116,"y":521,"width":727,"height":12}},{"id":"3d9ed8f5-bdee-4ca0-8eeb-07ac204d4403","block_type":"box","text":"continues to control key sectors of the economy, including upstream oil and gas production, and has","page_number":135,"box":{"x":116,"y":537,"width":749,"height":12}},{"id":"a2ba3493-a092-4515-afc6-1234c72d64b2","block_type":"box","text":"sought to increase its role in key sectors, such as telecommunications and steel. Meanwhile,","page_number":135,"box":{"x":116,"y":552,"width":692,"height":12}},{"id":"e103f752-9d52-403b-ab43-74b93d3afecb","block_type":"box","text":"ambiguities in the investment environment remain, such as continued high levels of bureaucracy and","page_number":135,"box":{"x":116,"y":568,"width":753,"height":12}},{"id":"33d1c85c-fc88-4a65-b039-480efb49b8b5","block_type":"box","text":"corruption, large macroeconomic imbalances, and political and policy uncertainty. Friction continues","page_number":135,"box":{"x":116,"y":583,"width":746,"height":12}},{"id":"f7931e14-13c8-4660-9f8a-12877a809a7b","block_type":"box","text":"between the governments of the U.S. and Venezuela. The U.S. has imposed economic sanctions,","page_number":135,"box":{"x":117,"y":599,"width":731,"height":12}},{"id":"8c9db19b-e636-4d93-9160-333850334cfc","block_type":"box","text":"which consist of asset freezes and sectoral sanctions, on certain Venezuelan individuals and","page_number":135,"box":{"x":116,"y":614,"width":693,"height":11}},{"id":"eebbf203-ab0e-4cc7-84af-f3bbfedb6282","block_type":"box","text":"Venezuelan corporate entities, and on the Venezuelan government. The U.S. could also institute","page_number":135,"box":{"x":116,"y":630,"width":722,"height":12}},{"id":"089fdeee-a906-43a1-97bc-8a0eebe746ee","block_type":"box","text":"broader sanctions on Venezuela. The U.S. has also taken military action against Venezuela in an effort","page_number":135,"box":{"x":117,"y":645,"width":769,"height":12}},{"id":"030cbf36-c484-43f9-88a8-869a94718f1d","block_type":"box","text":"to effect regime change. Military action, sanctions, or even the threat of further military action and","page_number":135,"box":{"x":116,"y":661,"width":721,"height":12}},{"id":"c5255ded-325d-4b18-8f82-f197c7506b30","block_type":"box","text":"sanctions, may result in the decline of the value and liquidity of Venezuelan securities, a weakening of","page_number":135,"box":{"x":116,"y":676,"width":758,"height":12}},{"id":"447a7a3d-598b-4626-a1d1-448a6084559a","block_type":"box","text":"the bolivar or other adverse consequences to the Venezuelan economy. These sanctions impair the","page_number":135,"box":{"x":116,"y":692,"width":741,"height":12}},{"id":"245ad531-cfca-45da-bb00-2961abf1e29b","block_type":"box","text":"ability of a Fund to buy, sell, receive or deliver those securities and/or assets. Additional sanctions","page_number":135,"box":{"x":116,"y":707,"width":727,"height":12}},{"id":"8ae55af5-e9c5-47d2-b0a1-78fb9ecbc57d","block_type":"box","text":"against Venezuela may in the future be imposed by the U.S. or other countries. These factors, among","page_number":135,"box":{"x":116,"y":723,"width":755,"height":12}},{"id":"8ff2e256-ca66-4048-94bf-331478b5f2f4","block_type":"box","text":"others, can have a negative impact on a Fund’s investments.","page_number":135,"box":{"x":116,"y":738,"width":451,"height":12}},{"id":"0ac656ce-0e08-475c-819b-14d44911a7fa","block_type":"box","text":"Brady Bonds.","page_number":135,"box":{"x":116,"y":769,"width":99,"height":12}},{"id":"8a457f76-5680-43be-b1c3-a32f175bfca8","block_type":"box","text":"Certain Funds may invest in Brady Bonds. A Fund’s emerging market debt securities","page_number":135,"box":{"x":222,"y":769,"width":628,"height":12}},{"id":"7d34ec74-8c7d-47d1-ae66-3c3da220566a","block_type":"box","text":"may include emerging market governmental debt obligations commonly referred to as Brady Bonds.","page_number":135,"box":{"x":117,"y":785,"width":739,"height":12}},{"id":"d17436f6-aeb8-44f1-8783-71d9b833d30b","block_type":"box","text":"Brady Bonds are securities created through the exchange of existing commercial bank loans to","page_number":135,"box":{"x":117,"y":800,"width":704,"height":12}},{"id":"0f51168c-d5d0-4661-98a1-f5aac4efbed7","block_type":"box","text":"sovereign entities for new obligations in connection with debt restructurings under a debt restructuring","page_number":135,"box":{"x":116,"y":816,"width":755,"height":12}},{"id":"9bad7077-ddbb-439a-bef1-9f7e4656b6c8","block_type":"box","text":"plan introduced by former U.S. Secretary of the Treasury, Nicholas F. Brady (the “Brady Plan”). Brady","page_number":135,"box":{"x":117,"y":831,"width":760,"height":12}},{"id":"3feeafcd-60bd-4d19-b9d0-b9550fff6f1c","block_type":"box","text":"Plan debt restructurings have been implemented in a number of countries, including: Argentina,","page_number":135,"box":{"x":117,"y":847,"width":713,"height":12}},{"id":"73a635cc-a7a8-4d38-a537-6cfc9529c8ce","block_type":"box","text":"Bolivia, Brazil, Bulgaria, Costa Rica, the Dominican Republic, Ecuador, Jordan, Mexico, Niger, Nigeria,","page_number":135,"box":{"x":117,"y":862,"width":766,"height":12}},{"id":"9dafa4e0-25ab-4d36-a00d-e2a04c41195a","block_type":"box","text":"Panama, Peru, the Philippines, Poland, Uruguay, Venezuela, and Vietnam. 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Brady Bonds are not considered to","page_number":136,"box":{"x":117,"y":149,"width":756,"height":12}},{"id":"f16708fb-322b-4a77-a224-9ec94ed73f1c","block_type":"box","text":"be U.S. Government Securities. U.S. dollar-denominated, collateralized Brady Bonds, which may be","page_number":136,"box":{"x":117,"y":165,"width":747,"height":12}},{"id":"d951522a-6825-4013-a573-212e29eb4e5e","block_type":"box","text":"fixed rate par bonds or floating rate discount bonds, are generally collateralized in full as to principal by","page_number":136,"box":{"x":116,"y":180,"width":768,"height":12}},{"id":"5a52e914-6fda-4179-8fcc-34fdac9208fc","block_type":"box","text":"U.S. Treasury zero-coupon bonds having the same maturity as the Brady Bonds. Interest payments on","page_number":136,"box":{"x":117,"y":196,"width":767,"height":12}},{"id":"58dfcf96-e916-46e8-9843-a5dc7a450664","block_type":"box","text":"these Brady Bonds generally are collateralized on a one-year or longer rolling-forward basis by cash or","page_number":136,"box":{"x":116,"y":211,"width":769,"height":12}},{"id":"d0ab038a-062f-4a32-98ad-91b65be849b6","block_type":"box","text":"securities in an amount that, in the case of fixed rate bonds, is equal to at least one year of interest","page_number":136,"box":{"x":116,"y":227,"width":738,"height":12}},{"id":"0185b0e4-1e34-4926-b701-57703a1b7d23","block_type":"box","text":"payments or, in the case of floating rate bonds, initially is equal to at least one year’s interest payments","page_number":136,"box":{"x":117,"y":242,"width":769,"height":12}},{"id":"86d4a483-be60-4d1f-9a3f-392c0a06b17f","block_type":"box","text":"based on the applicable interest rate at that time and is adjusted at regular intervals thereafter. Certain","page_number":136,"box":{"x":117,"y":258,"width":764,"height":12}},{"id":"a6300f98-039a-40c2-a762-3f92767bf194","block_type":"box","text":"Brady Bonds are entitled to “value recovery payments” in certain circumstances, which in effect","page_number":136,"box":{"x":117,"y":273,"width":711,"height":12}},{"id":"5c0107c2-907b-4149-963f-653ad14587a0","block_type":"box","text":"constitute supplemental interest payments but generally are not collateralized. Brady Bonds are often","page_number":136,"box":{"x":116,"y":289,"width":757,"height":12}},{"id":"40452eb9-8f0c-4be0-966e-1fac280cd26b","block_type":"box","text":"viewed as having three or four valuation components: (i) the collateralized repayment of principal at","page_number":136,"box":{"x":116,"y":304,"width":743,"height":12}},{"id":"ebcc3a2f-75e5-4068-9290-7f4723c3b7ae","block_type":"box","text":"final maturity; (ii) the collateralized interest payments; (iii) the uncollateralized interest payments; and","page_number":136,"box":{"x":116,"y":320,"width":753,"height":12}},{"id":"dd44a7a1-ecd7-46c6-9d91-0a320449989e","block_type":"box","text":"(iv) any uncollateralized repayment of principal at maturity (the uncollateralized amounts constitute the","page_number":136,"box":{"x":117,"y":335,"width":763,"height":12}},{"id":"74deb93b-1b5a-4435-8de3-e5ccc8bc0603","block_type":"box","text":"“residual risk”).","page_number":136,"box":{"x":116,"y":351,"width":116,"height":12}},{"id":"51023c75-8280-4eec-9354-30607dbfad82","block_type":"box","text":"Brady Bonds involve various risk factors described above associated with investing in foreign","page_number":136,"box":{"x":117,"y":382,"width":695,"height":12}},{"id":"49d6a0ac-3b10-4398-ac3f-fbbfedbec10f","block_type":"box","text":"securities, including the history of defaults with respect to commercial bank loans by public and private","page_number":136,"box":{"x":116,"y":397,"width":765,"height":12}},{"id":"e72e78ab-7f7d-44f1-a1b2-a5167e4cc2b6","block_type":"box","text":"entities of countries issuing Brady Bonds. In light of the residual risk of Brady Bonds and, among other","page_number":136,"box":{"x":116,"y":413,"width":764,"height":12}},{"id":"62e8bd2b-5985-4b8c-941f-6179178adce1","block_type":"box","text":"factors, the history of defaults, investments in Brady Bonds are considered speculative. There can be","page_number":136,"box":{"x":116,"y":428,"width":756,"height":12}},{"id":"e86957bc-f9f1-4aad-a1ee-634e06e44e8b","block_type":"box","text":"no assurance that Brady Bonds in which the Funds may invest will not be subject to restructuring","page_number":136,"box":{"x":117,"y":444,"width":723,"height":12}},{"id":"d3e4c85a-2f3c-4404-b811-e05e46437d9d","block_type":"box","text":"arrangements or to requests for new credit, which may cause the Funds to suffer a loss of interest or","page_number":136,"box":{"x":116,"y":459,"width":752,"height":12}},{"id":"c6076e4f-b8eb-4802-8865-b92c54f0fc66","block_type":"box","text":"principal on any of its holdings.","page_number":136,"box":{"x":117,"y":475,"width":234,"height":12}},{"id":"7568c499-c91c-41de-a6f8-a044bf33e140","block_type":"box","text":"China Investments Risk.","page_number":136,"box":{"x":117,"y":506,"width":185,"height":9}},{"id":"fb491257-3850-4151-9f6a-da67ffd558de","block_type":"box","text":"Investments in securities of companies domiciled in the People’s Republic of China (“China” or the","page_number":136,"box":{"x":117,"y":529,"width":734,"height":12}},{"id":"d02e432a-e771-4856-a559-f7f29079ff2c","block_type":"box","text":"“PRC”), including certain Hong Kong-listed and U.S.-listed securities, involve a high degree of risk and","page_number":136,"box":{"x":116,"y":544,"width":764,"height":12}},{"id":"da61ee10-fd18-4577-bb4d-3a3d4f181bae","block_type":"box","text":"special considerations not typically associated with investing in the U.S. securities markets. Such","page_number":136,"box":{"x":116,"y":560,"width":725,"height":12}},{"id":"f8e6312c-38af-4dad-8f80-5ef949848c04","block_type":"box","text":"heightened risks include, among others, an authoritarian government, popular unrest associated with","page_number":136,"box":{"x":117,"y":576,"width":753,"height":11}},{"id":"4d0062fe-dd11-4c42-b964-e794dcf1b52d","block_type":"box","text":"demands for improved political, economic and social conditions, the impact of regional conflict on the","page_number":136,"box":{"x":116,"y":591,"width":754,"height":12}},{"id":"4d561800-0326-459f-a426-012fd062a4fe","block_type":"box","text":"economy and hostile relations with other countries.","page_number":136,"box":{"x":116,"y":607,"width":382,"height":11}},{"id":"8bdf2f6d-c7e2-444b-9c9b-fa847cb48d55","block_type":"box","text":"Military conflicts, either in response to internal social unrest or conflicts with other countries, could","page_number":136,"box":{"x":117,"y":637,"width":729,"height":12}},{"id":"ce76f9b5-dff8-404a-9b09-d56083927bdf","block_type":"box","text":"disrupt economic development. The Chinese economy is vulnerable to the long-running disagreements","page_number":136,"box":{"x":116,"y":653,"width":769,"height":12}},{"id":"55a89ce9-44d2-43fe-9869-f1f3529e5601","block_type":"box","text":"and religious and nationalist disputes with Tibet and the Xinjiang region. Since 1997, there have been","page_number":136,"box":{"x":116,"y":668,"width":752,"height":12}},{"id":"a4273ef1-a8b5-43de-83dd-06ce69e7298f","block_type":"box","text":"tensions between the Chinese government and many people in Hong Kong who perceive China as","page_number":136,"box":{"x":116,"y":684,"width":733,"height":12}},{"id":"a34d0f09-8c86-4c58-a1aa-f3103ce1e98c","block_type":"box","text":"tightening control over Hong Kong’s semi-autonomous liberal political, economic, legal, and social","page_number":136,"box":{"x":116,"y":700,"width":725,"height":12}},{"id":"febd5dcf-cc17-4805-ac7a-a8976b8c7c57","block_type":"box","text":"framework. Protests and unrest have increased tensions even further. Due to the interconnected","page_number":136,"box":{"x":116,"y":715,"width":716,"height":9}},{"id":"607b77f3-9e07-460c-abc0-394965904995","block_type":"box","text":"nature of the Hong Kong and Chinese economies, this instability in Hong Kong may cause uncertainty","page_number":136,"box":{"x":117,"y":730,"width":756,"height":13}},{"id":"412411b9-fd36-4182-b7d4-29bfa0a69499","block_type":"box","text":"in the Hong Kong and Chinese markets. China has a complex territorial dispute regarding the","page_number":136,"box":{"x":117,"y":746,"width":691,"height":12}},{"id":"0c0e1360-31e7-4c56-b4b7-ab5555d19261","block_type":"box","text":"sovereignty of Taiwan and has made threats of invasion. Taiwan-based companies and individuals are","page_number":136,"box":{"x":116,"y":761,"width":761,"height":13}},{"id":"b6848402-0dc0-41b9-956f-289a4b255ea7","block_type":"box","text":"significant investors in China. The continuing hostility between China and Taiwan may have an adverse","page_number":136,"box":{"x":116,"y":777,"width":767,"height":12}},{"id":"760bc4f4-f9d6-4d9c-99ad-030863dae1e8","block_type":"box","text":"impact on the value of the Fund’s investments in China or Taiwan, may cause a suspension in a","page_number":136,"box":{"x":117,"y":792,"width":712,"height":13}},{"id":"ed97bd10-18f1-4805-bb22-fd4c05b3094d","block_type":"box","text":"Fund’s ability to trade in certain securities or other assets or may otherwise make such investments","page_number":136,"box":{"x":117,"y":808,"width":736,"height":12}},{"id":"3fd616ad-d4df-4243-a884-0edfe15d3b40","block_type":"box","text":"impracticable or impossible. Any escalation of hostility between China and Taiwan would likely have a","page_number":136,"box":{"x":117,"y":823,"width":753,"height":13}},{"id":"561ec4e2-8bcd-4d60-930b-daa4f0c788f0","block_type":"box","text":"significant adverse impact on the value of the Fund’s investments in both countries and the region. In","page_number":136,"box":{"x":116,"y":839,"width":755,"height":12}},{"id":"2e9487e6-1716-412d-a16b-5944b0769417","block_type":"box","text":"addition, China has strained international relations with Japan, India, the Philippines and other","page_number":136,"box":{"x":116,"y":854,"width":703,"height":12}},{"id":"452a3410-9c97-46e8-b69d-90851e61800c","block_type":"box","text":"neighbors due to territorial disputes, historical animosities and other defense concerns. Frictions","page_number":136,"box":{"x":117,"y":870,"width":717,"height":12}},{"id":"cc6d991d-ea47-4a22-82dd-49ddcd9f6755","block_type":"box","text":"II-52","page_number":136,"box":{"x":484,"y":909,"width":31,"height":9}},{"id":"0c5d9c6b-5066-4f2d-8b73-0b0dff8f2b7a","block_type":"box","text":"NM0926U-5926888-136/257","page_number":136,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"1d4a7c79-2c5b-4c7d-be9f-327529db7e1a","block_type":"box","text":"between China and the Philippines in the South China Sea pose a risk of escalation potentially leading","page_number":137,"box":{"x":117,"y":87,"width":765,"height":12}},{"id":"bc895191-25e5-4d79-b4fa-e49416544377","block_type":"box","text":"to military conflict. Additionally, China is alleged to have participated in state-sponsored cyberattacks","page_number":137,"box":{"x":116,"y":102,"width":752,"height":13}},{"id":"b39248b5-3202-4534-a543-0f3e95ed1e1c","block_type":"box","text":"against foreign companies and foreign governments. Actual and threatened responses to such activity","page_number":137,"box":{"x":116,"y":118,"width":763,"height":12}},{"id":"5779f9b7-e4b0-42dc-8b38-f26b60975583","block_type":"box","text":"and strained international relations, including purchasing restrictions, sanctions, tariffs or cyberattacks","page_number":137,"box":{"x":116,"y":134,"width":760,"height":12}},{"id":"5f70c278-3e8c-48ad-9ff7-936e2cbf8d75","block_type":"box","text":"on the Chinese government or Chinese companies, may impact China’s economy and Chinese issuers","page_number":137,"box":{"x":116,"y":149,"width":769,"height":12}},{"id":"e8d49b2a-ee96-49c7-a7c7-449b106ddecc","block_type":"box","text":"of securities in which a Fund invests. China could be affected by military events on the Korean","page_number":137,"box":{"x":116,"y":165,"width":705,"height":12}},{"id":"138f64c5-e817-4840-9633-730f724fd9cb","block_type":"box","text":"peninsula or internal instability within North Korea. These situations may cause uncertainty in the","page_number":137,"box":{"x":117,"y":180,"width":723,"height":12}},{"id":"9cc95f9f-1875-484f-976d-63b792397efd","block_type":"box","text":"Chinese market and may adversely affect the performance of the Chinese economy.","page_number":137,"box":{"x":117,"y":196,"width":631,"height":12}},{"id":"8793e4ea-44ee-45ba-9612-9e99f5fcabf2","block_type":"box","text":"The Chinese government has implemented economic reforms in order to liberalize trade policy,","page_number":137,"box":{"x":116,"y":227,"width":712,"height":12}},{"id":"a7305187-a77b-47b6-8fc1-1c83d45a8b7f","block_type":"box","text":"promote foreign investment in the economy, reduce government control of the economy and develop","page_number":137,"box":{"x":117,"y":242,"width":752,"height":12}},{"id":"a3afbdbb-8298-4c22-95e2-f6ce0a0ada25","block_type":"box","text":"market mechanisms. However, the Chinese government still exercises substantial influence over many","page_number":137,"box":{"x":117,"y":258,"width":768,"height":12}},{"id":"3d84b6dc-7e17-4fb2-9d36-3c71205b7d7b","block_type":"box","text":"aspects of the private sector and may own or control many companies. Chinese companies, such as","page_number":137,"box":{"x":116,"y":273,"width":751,"height":12}},{"id":"3e9ffa67-005d-4c43-b9fe-e96be21c327c","block_type":"box","text":"those in the financial services or technology sectors, and potentially other sectors in the future, are","page_number":137,"box":{"x":116,"y":289,"width":736,"height":12}},{"id":"250293f1-271f-4919-a0ff-74dae1284ada","block_type":"box","text":"subject to the risk that Chinese authorities can intervene in their operations and structure. The Chinese","page_number":137,"box":{"x":116,"y":304,"width":769,"height":12}},{"id":"1bdc61ed-f809-4b01-9a35-645125e03353","block_type":"box","text":"government continues to maintain a major role in economic policymaking and investing in China","page_number":137,"box":{"x":116,"y":320,"width":717,"height":12}},{"id":"70f725fe-edf8-43f7-8305-45441ccd26ef","block_type":"box","text":"involves risk of loss due to expropriation, nationalization, confiscation of assets and property or the","page_number":137,"box":{"x":117,"y":335,"width":736,"height":12}},{"id":"14ec5c8a-ef6b-4d89-b2a6-696bb0010c17","block_type":"box","text":"imposition of restrictions on foreign investments and on repatriation of capital invested.","page_number":137,"box":{"x":117,"y":351,"width":647,"height":12}},{"id":"803b27fe-4b23-4fcf-bfe1-9e4aff9aed68","block_type":"box","text":"The Chinese government may intervene in the Chinese financial markets, such as by the imposition of","page_number":137,"box":{"x":116,"y":382,"width":764,"height":12}},{"id":"ff402eb2-fe82-43d8-8328-ba29f230d406","block_type":"box","text":"trading restrictions, a ban on “naked” short selling or the suspension of short selling for certain stocks.","page_number":137,"box":{"x":116,"y":397,"width":761,"height":12}},{"id":"cf985db8-a788-4a25-aef0-23fdb231227e","block_type":"box","text":"This may affect market price and liquidity of these stocks, and may have an unpredictable impact on","page_number":137,"box":{"x":116,"y":413,"width":748,"height":12}},{"id":"1dbab6b3-0026-49bd-9b7d-e61db638f71c","block_type":"box","text":"the investment activities of the Funds. Furthermore, such market interventions may have a negative","page_number":137,"box":{"x":116,"y":428,"width":745,"height":12}},{"id":"1b693b90-e4bb-421d-a844-213c695f4d37","block_type":"box","text":"impact on market sentiment which may in turn affect the performance of the securities markets and as","page_number":137,"box":{"x":117,"y":444,"width":762,"height":12}},{"id":"f6c09072-5ade-4a0f-9b6f-24eac6491274","block_type":"box","text":"a result the performance of the Funds.","page_number":137,"box":{"x":116,"y":459,"width":290,"height":12}},{"id":"4fe0c3c1-8838-4b53-be00-b771db706d5d","block_type":"box","text":"In addition, there is less regulation and monitoring of Chinese securities markets and the activities of","page_number":137,"box":{"x":117,"y":490,"width":749,"height":12}},{"id":"91e02098-2b1d-4882-8b99-940c0038d5ed","block_type":"box","text":"investors, brokers and other participants than in the United States. Accordingly, issuers of securities in","page_number":137,"box":{"x":117,"y":506,"width":763,"height":12}},{"id":"2053dfb7-4a1d-43b7-94f4-347011ce5c22","block_type":"box","text":"China, including Chinese companies that are listed on U.S. exchanges, are not subject to the same","page_number":137,"box":{"x":117,"y":521,"width":741,"height":12}},{"id":"9c2c87cb-f34a-4ebb-873d-adcbdcd921e9","block_type":"box","text":"degree of regulation as are U.S. issuers with respect to such matters as insider trading rules, tender","page_number":137,"box":{"x":116,"y":537,"width":747,"height":12}},{"id":"0ca35656-0f44-4cef-ae63-df02386c8136","block_type":"box","text":"offer regulation, accounting standards or auditor oversight, stockholder proxy requirements and the","page_number":137,"box":{"x":116,"y":552,"width":740,"height":12}},{"id":"b7259aaa-4440-4bf3-9fbc-fdc079a44f6e","block_type":"box","text":"requirements mandating timely and accurate disclosure of information. Securities markets in China are","page_number":137,"box":{"x":117,"y":568,"width":766,"height":12}},{"id":"18d4d9da-f6a6-4842-b12e-09c0b154b7a9","block_type":"box","text":"in the process of change and further development. This may lead to trading volatility, difficulty in the","page_number":137,"box":{"x":117,"y":583,"width":744,"height":12}},{"id":"9e17461d-c765-4022-bc41-074ff8c23f92","block_type":"box","text":"settlement and recording of transactions and difficulty in interpreting and applying the relevant","page_number":137,"box":{"x":116,"y":599,"width":701,"height":12}},{"id":"83bc2819-7c72-4a19-a60f-d78b5db2b09d","block_type":"box","text":"regulation. Custodians may not be able to offer the level of service and safe-keeping in relation to the","page_number":137,"box":{"x":117,"y":614,"width":755,"height":12}},{"id":"4fe58c28-05eb-4483-9bdc-31228b75fd33","block_type":"box","text":"settlement and administration of securities in China that is customary in more developed markets. In","page_number":137,"box":{"x":116,"y":630,"width":748,"height":12}},{"id":"86b09a68-56f2-46bf-bed2-ba818510d6a4","block_type":"box","text":"particular, there is a risk that a Fund may not be recognized as the owner of securities that are held on","page_number":137,"box":{"x":117,"y":645,"width":764,"height":12}},{"id":"7d4e2c48-61f3-469d-9103-15fe120bd56b","block_type":"box","text":"behalf of the Fund by a subcustodian.","page_number":137,"box":{"x":117,"y":661,"width":278,"height":12}},{"id":"0c6cad4e-02ae-4b5c-9d96-3c779fa9dcd2","block_type":"box","text":"There may be significant obstacles to obtaining information necessary for investigations into or","page_number":137,"box":{"x":116,"y":692,"width":702,"height":12}},{"id":"5e53d212-34ec-4893-9148-d8e4e87b46ca","block_type":"box","text":"litigation against Chinese companies, and shareholders may have limited legal remedies. The Funds","page_number":137,"box":{"x":117,"y":707,"width":745,"height":12}},{"id":"03ea6875-ec72-4eee-b1c0-c7dd01188087","block_type":"box","text":"do not select investments based on investor protection considerations.","page_number":137,"box":{"x":116,"y":723,"width":522,"height":12}},{"id":"e25d2361-d79c-4c82-916c-f8510d4c57ca","block_type":"box","text":"The Chinese government historically took positions that prevented the U.S. Public Company","page_number":137,"box":{"x":116,"y":754,"width":684,"height":12}},{"id":"415c8ddf-bbe8-41a1-bcd5-7b872e8de83a","block_type":"box","text":"Accounting Oversight Board (“PCAOB”) from inspecting the audit work and practices of accounting","page_number":137,"box":{"x":116,"y":769,"width":732,"height":12}},{"id":"63cf3ee5-441e-4589-805c-3cfeec6c6372","block_type":"box","text":"firms in mainland China and Hong Kong for compliance with U.S. law and professional standards. On","page_number":137,"box":{"x":116,"y":785,"width":751,"height":12}},{"id":"bebd1f03-e52e-49d0-80b9-5e465b8d6a2f","block_type":"box","text":"August 26, 2022, the PCAOB signed a Statement of Protocol with the China Securities Regulatory","page_number":137,"box":{"x":116,"y":800,"width":729,"height":12}},{"id":"28d308a7-8b92-4bae-9725-ef475f2dde9f","block_type":"box","text":"Commission and the Ministry of Finance of the PRC, which marked the first step toward opening","page_number":137,"box":{"x":117,"y":816,"width":714,"height":12}},{"id":"85c5a204-464d-4b69-b25a-79bd28c6b85d","block_type":"box","text":"access for the PCAOB to inspect and investigate registered public accounting firms headquartered in","page_number":137,"box":{"x":116,"y":831,"width":755,"height":12}},{"id":"8f33f923-68af-4cf7-8c89-61d2864236ef","block_type":"box","text":"mainland China and Hong Kong completely in accordance with U.S. law. However, as this","page_number":137,"box":{"x":117,"y":847,"width":672,"height":12}},{"id":"b8f39b4f-8d39-4fcb-af68-0e62d56f9eb9","block_type":"box","text":"development is relatively recent, the implementation of the Statement of Protocol remains to be tested.","page_number":137,"box":{"x":116,"y":862,"width":767,"height":12}},{"id":"e62b5d10-2e36-442f-9aac-c3d52ab2f6b5","block_type":"box","text":"Audits performed by PCAOB-registered accounting firms in mainland China and Hong Kong may be","page_number":137,"box":{"x":116,"y":878,"width":747,"height":12}},{"id":"ab99b7cb-3e36-4172-b9ea-c8075b592e5f","block_type":"box","text":"II-53","page_number":137,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"a2b33a5c-0832-4a3c-b9b0-0ce1ff639468","block_type":"box","text":"NM0926U-5926888-137/257","page_number":137,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"6fbc0111-63cb-4162-8644-f479ea3cf898","block_type":"box","text":"less reliable than those performed by firms subject to PCAOB inspection. Accordingly, information","page_number":138,"box":{"x":117,"y":87,"width":730,"height":12}},{"id":"8c4fe8c0-2e1b-4126-8e95-c35b9b2b11ed","block_type":"box","text":"about the Chinese securities in which the Funds invest may be less reliable or complete. Under","page_number":138,"box":{"x":116,"y":102,"width":712,"height":13}},{"id":"8d54589a-e2d5-4429-9134-42ce2dcfa26f","block_type":"box","text":"amendments to the Sarbanes-Oxley Act enacted in December 2020, which requires that the PCAOB","page_number":138,"box":{"x":116,"y":118,"width":752,"height":12}},{"id":"1e1f28cb-3118-4058-b7c3-8d0c878694cf","block_type":"box","text":"be permitted to inspect the accounting firm of a U.S.-listed Chinese issuer, Chinese companies with","page_number":138,"box":{"x":117,"y":134,"width":743,"height":12}},{"id":"37f7fe4c-846d-43df-b98d-2196c446363c","block_type":"box","text":"securities listed on U.S. exchanges may be delisted if the PCAOB is unable to inspect the","page_number":138,"box":{"x":116,"y":149,"width":670,"height":12}},{"id":"f6d50980-7428-46a5-8778-826f55e7b48d","block_type":"box","text":"accounting firm.","page_number":138,"box":{"x":116,"y":165,"width":123,"height":12}},{"id":"4a2557e4-cdb0-4799-bcfb-c8721f86d775","block_type":"box","text":"The Renminbi (“RMB”) is currently not a freely convertible currency and is subject to foreign exchange","page_number":138,"box":{"x":116,"y":196,"width":763,"height":12}},{"id":"d9a50076-2d20-4261-8d85-66293a184bc3","block_type":"box","text":"control policies and repatriation restrictions imposed by the Chinese government. The imposition of","page_number":138,"box":{"x":116,"y":211,"width":740,"height":12}},{"id":"222d09a8-98d9-4e14-97dd-0179a1977381","block_type":"box","text":"currency controls may negatively impact performance and liquidity of the Funds as capital may become","page_number":138,"box":{"x":116,"y":227,"width":772,"height":12}},{"id":"08c51ae8-53ae-4005-b778-89ac2a0a7d3c","block_type":"box","text":"trapped in the PRC. The Funds could be adversely affected by delays in, or a refusal to grant, any","page_number":138,"box":{"x":116,"y":242,"width":732,"height":12}},{"id":"01a84144-1be3-466f-b050-1243e93c0ec1","block_type":"box","text":"required governmental approval for repatriation of capital, as well as by the application to the Funds of","page_number":138,"box":{"x":117,"y":258,"width":762,"height":12}},{"id":"59eab4dd-214d-4a88-9079-742cdba8a798","block_type":"box","text":"any restrictions on investments. Investing in entities either in, or which have a substantial portion of","page_number":138,"box":{"x":116,"y":273,"width":740,"height":12}},{"id":"05620584-4d11-4c6c-aecf-ab7ac184689b","block_type":"box","text":"their operations in, the PRC may require the Funds to adopt special procedures, seek local","page_number":138,"box":{"x":116,"y":289,"width":680,"height":12}},{"id":"c81bc64c-61e7-4427-bf88-9ebfbee7ec85","block_type":"box","text":"government approvals or take other actions, each of which may involve additional costs and delays to","page_number":138,"box":{"x":116,"y":304,"width":759,"height":12}},{"id":"e2b9efaa-a9b0-42fc-b52f-58a138845ebd","block_type":"box","text":"the Funds. The Fund may also incur costs in connection with conversions between U.S. dollars and","page_number":138,"box":{"x":116,"y":320,"width":743,"height":12}},{"id":"ed10d534-a680-4130-bccd-15e624e846ae","block_type":"box","text":"RMB, as well as in connection with conversions between the two separate types of RMB, the onshore","page_number":138,"box":{"x":117,"y":335,"width":758,"height":12}},{"id":"2d9868fa-d480-4f8c-b61b-350d62e99eaa","block_type":"box","text":"RMB (“CNY”) and the offshore RMB (“CNH”).","page_number":138,"box":{"x":117,"y":351,"width":340,"height":12}},{"id":"dd32b478-8a5b-41fe-b0d8-94f8975b3f2b","block_type":"box","text":"Many Chinese companies listed on U.S. exchanges use variable interest entities or “VIEs” in their","page_number":138,"box":{"x":117,"y":382,"width":727,"height":12}},{"id":"62e9526b-9217-4f5c-a36f-ec19aae1b38e","block_type":"box","text":"structure as a result of foreign ownership restrictions. In a VIE structure, a Chinese operating company","page_number":138,"box":{"x":116,"y":397,"width":767,"height":12}},{"id":"c6f9869b-5170-48aa-a9c7-a898f0c327d7","block_type":"box","text":"establishes a shell company in another jurisdiction to issue stock to public shareholders. When a VIE","page_number":138,"box":{"x":116,"y":413,"width":754,"height":12}},{"id":"2c02c2f9-34ff-4358-a38c-aa2e8c908fcf","block_type":"box","text":"structure is used by a Chinese company to list its stock in the U.S., instead of owning the equity","page_number":138,"box":{"x":116,"y":428,"width":715,"height":12}},{"id":"e3362ca0-5ea1-4d07-80a9-4abe486b3b33","block_type":"box","text":"securities of the Chinese company, the U.S.-listed shell company directly or indirectly enters into","page_number":138,"box":{"x":116,"y":444,"width":721,"height":12}},{"id":"96077d41-f067-4c51-83c8-c0619bacbdb0","block_type":"box","text":"contracts with the Chinese operating company under Chinese law. These contracts provide the U.S.-","page_number":138,"box":{"x":116,"y":459,"width":749,"height":12}},{"id":"1ca51f88-6806-46a0-9b14-3f4951d8ac45","block_type":"box","text":"listed shell company with only economic exposure to the Chinese company and do not represent","page_number":138,"box":{"x":117,"y":475,"width":722,"height":12}},{"id":"17a85f49-f1eb-466c-986a-92850b0c3eea","block_type":"box","text":"equity ownership in the operating company.","page_number":138,"box":{"x":116,"y":490,"width":329,"height":12}},{"id":"9b34fcc2-e874-4040-8517-206add5579a3","block_type":"box","text":"While VIEs are a longstanding practice that is well known to Chinese officials and regulators, they have","page_number":138,"box":{"x":116,"y":521,"width":770,"height":12}},{"id":"75e7b369-7fab-4691-8277-4411646cfb24","block_type":"box","text":"not been formally recognized under Chinese law. The Chinese government has provided guidance to","page_number":138,"box":{"x":117,"y":537,"width":754,"height":12}},{"id":"32de6856-c66f-421d-9fab-2e8c36c4d005","block_type":"box","text":"and placed restrictions on Chinese-based companies raising capital offshore, including through VIEs.","page_number":138,"box":{"x":116,"y":552,"width":755,"height":12}},{"id":"5f9c28b2-bc88-4a77-bb13-b41a2d2e419a","block_type":"box","text":"In 2023, the China Securities Regulatory Commission (“CSRC”) released new rules that permit the use","page_number":138,"box":{"x":117,"y":568,"width":768,"height":12}},{"id":"b241a10d-95c8-42a8-9ee8-6c0f71540794","block_type":"box","text":"of VIE structures, provided they abide by Chinese laws and register with the CSRC. The rules,","page_number":138,"box":{"x":116,"y":583,"width":705,"height":12}},{"id":"8e0587b4-be94-4009-9c0e-a485b99ff24e","block_type":"box","text":"however, may cause Chinese companies to undergo greater scrutiny and add costs to VIE structures.","page_number":138,"box":{"x":117,"y":599,"width":759,"height":12}},{"id":"5c40c749-1eee-4dfd-b418-476fcc8072f8","block_type":"box","text":"Intervention, rulemaking or guidance by the Chinese government with respect to VIE structures or the","page_number":138,"box":{"x":117,"y":614,"width":758,"height":12}},{"id":"cfbd8cd0-533b-46ed-8813-dfef3f4e6627","block_type":"box","text":"non-enforcement of VIE-related contractual rights could significantly affect the operating company’s","page_number":138,"box":{"x":117,"y":630,"width":742,"height":12}},{"id":"e06dfce0-158d-4197-9dbf-9f239a5b5256","block_type":"box","text":"business in China, the enforceability of the U.S.-listed shell company’s contractual arrangements with","page_number":138,"box":{"x":117,"y":645,"width":756,"height":12}},{"id":"b9e0d845-4d0e-4ee0-b412-e00b5a3e9f19","block_type":"box","text":"the Chinese company and the value of the U.S.-listed stock. Further, the VIE contractual arrangement","page_number":138,"box":{"x":116,"y":661,"width":757,"height":12}},{"id":"b3d2fd75-2674-4d89-b660-747e43676f04","block_type":"box","text":"would likely be subject to Chinese law and jurisdiction, and remedies available to the U.S.-listed shell","page_number":138,"box":{"x":116,"y":676,"width":748,"height":12}},{"id":"0c07c5a3-2b47-4795-88d4-8b6cb7c54e73","block_type":"box","text":"company are uncertain and could be ineffective. In addition to the risk of government intervention,","page_number":138,"box":{"x":116,"y":692,"width":724,"height":12}},{"id":"e2dd8768-2a89-46bf-88ba-f255eeca2c61","block_type":"box","text":"investments through a VIE structure are subject to the risk that the China-based company (or its","page_number":138,"box":{"x":117,"y":707,"width":711,"height":12}},{"id":"a6e6a539-5dea-451c-bba9-6f0201178557","block_type":"box","text":"officers, directors, or Chinese equity owners) may breach those contractual arrangements, or Chinese","page_number":138,"box":{"x":116,"y":723,"width":757,"height":12}},{"id":"f8d6ddb4-2727-49d6-a782-50f5295b2dae","block_type":"box","text":"law changes in a way that adversely affects the enforceability of these arrangements, or those","page_number":138,"box":{"x":117,"y":738,"width":697,"height":12}},{"id":"511c631a-0a82-4724-a97c-b2e48a49f64a","block_type":"box","text":"contracts are otherwise not enforceable under Chinese law, in which case the Fund may suffer","page_number":138,"box":{"x":116,"y":754,"width":703,"height":12}},{"id":"fc794fe6-649a-4c00-8bc3-f63b953ac90e","block_type":"box","text":"significant losses on its investments through a VIE structure with little or no recourse available. Any","page_number":138,"box":{"x":116,"y":769,"width":736,"height":12}},{"id":"a529052a-8b0c-4593-80c4-499472d62439","block_type":"box","text":"change in the operations of entities in a VIE structure, the status of VIE contractual arrangements or","page_number":138,"box":{"x":116,"y":785,"width":743,"height":12}},{"id":"2631d61c-ea5b-4ca0-a8eb-73bd81f41956","block_type":"box","text":"the legal or regulatory environment in China, generally or with respect to specific industries, could","page_number":138,"box":{"x":116,"y":800,"width":723,"height":12}},{"id":"20b58a2b-55bd-4378-b868-aac8d407f33e","block_type":"box","text":"result in significant, and possibly permanent and/or total, losses to a Fund.","page_number":138,"box":{"x":117,"y":816,"width":550,"height":12}},{"id":"abf686bd-6dcc-4c99-ace5-e5b67cbf760a","block_type":"box","text":"While the Chinese economy has experienced past periods of rapid growth, there is no assurance that","page_number":138,"box":{"x":116,"y":847,"width":758,"height":12}},{"id":"8ac44a61-1f2a-4828-9d6b-2bddae266436","block_type":"box","text":"such growth rates will recur. Other economic challenges for China include indebtedness, weak","page_number":138,"box":{"x":116,"y":862,"width":706,"height":12}},{"id":"5c88d452-c27c-4ba3-98e6-55bc743e1154","block_type":"box","text":"consumer demand, trade tensions, and an aging population. China continues to face pressure from its","page_number":138,"box":{"x":116,"y":878,"width":763,"height":12}},{"id":"105e629b-3372-48c4-8478-ea0c38df327a","block_type":"box","text":"II-54","page_number":138,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"d1f9c525-8c13-493c-add0-d8fc83f2a6cb","block_type":"box","text":"NM0926U-5926888-138/257","page_number":138,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"6e02a4a2-8524-46ce-8ac7-0971373fb012","block_type":"box","text":"trading partners over its exporting of its excess industrial capacity and overall approach to economic","page_number":139,"box":{"x":116,"y":87,"width":748,"height":12}},{"id":"bc5c13e8-ed92-4943-87b2-6e54b5f135ed","block_type":"box","text":"management. China’s economy is heavily dependent on export growth. Reduction in spending on","page_number":139,"box":{"x":117,"y":102,"width":727,"height":13}},{"id":"b210ef09-d33d-48cc-be12-df34c3753d2d","block_type":"box","text":"Chinese products and services, supply chain diversification, institution of additional tariffs, sanctions or","page_number":139,"box":{"x":117,"y":118,"width":765,"height":12}},{"id":"8f1baf4d-c7b9-4fa4-93e0-5639fbfc0ce7","block_type":"box","text":"other trade barriers (including as a result of heightened trade tensions between China and the United","page_number":139,"box":{"x":116,"y":134,"width":755,"height":12}},{"id":"b5363537-180a-498b-87b6-4b2eff4a2bb2","block_type":"box","text":"States or in response to actual or alleged Chinese cyber activity) or a downturn in any of the","page_number":139,"box":{"x":116,"y":149,"width":688,"height":12}},{"id":"10dd8ad5-86de-4848-ad3a-4c0c0aaa9a26","block_type":"box","text":"economies of China’s key trading partners may have an adverse impact on the Chinese economy and","page_number":139,"box":{"x":116,"y":165,"width":762,"height":12}},{"id":"cab5d0a3-79f0-4b99-8a67-7b0f8e3dcede","block_type":"box","text":"the companies in which a Fund invests. Certain Chinese companies (which may change from time to","page_number":139,"box":{"x":116,"y":180,"width":753,"height":12}},{"id":"9ed7aa14-90c9-42f3-8643-ccc6f512bb68","block_type":"box","text":"time) are directly or indirectly subject to economic or trade restrictions imposed by the U.S. or other","page_number":139,"box":{"x":116,"y":196,"width":741,"height":12}},{"id":"0bebc867-427f-47da-9921-25b14cb4d965","block_type":"box","text":"governments due to national security, human rights or other concerns of such government. For","page_number":139,"box":{"x":116,"y":211,"width":709,"height":12}},{"id":"acde56d0-157a-49bb-92fa-2523a9b7a05f","block_type":"box","text":"example, certain foreign technology companies are subject to U.S. export controls as those companies","page_number":139,"box":{"x":116,"y":227,"width":769,"height":12}},{"id":"81a477fa-3325-4650-b142-51b64f5d08ad","block_type":"box","text":"are believed to pose a risk to U.S. interests. The U.S. also bans imports of goods produced in certain","page_number":139,"box":{"x":116,"y":242,"width":755,"height":12}},{"id":"da88b13d-a9d0-40ed-9326-a15197f199cc","block_type":"box","text":"regions of China or by certain Chinese companies due to concerns about forced labor. Such","page_number":139,"box":{"x":117,"y":258,"width":688,"height":12}},{"id":"85a1cf8f-7339-4394-a4e4-03c5e86a44aa","block_type":"box","text":"restrictions may have unanticipated and adverse effects on the Chinese economy and companies. Any","page_number":139,"box":{"x":117,"y":273,"width":767,"height":12}},{"id":"f4a686ed-0ba5-4732-b91b-26404a5e2e58","block_type":"box","text":"action that targets Chinese financial markets or securities exchanges could interfere with orderly","page_number":139,"box":{"x":116,"y":289,"width":719,"height":12}},{"id":"7f33c7da-7169-4d69-9be4-c4dc18e58ea1","block_type":"box","text":"trading, delay settlement or cause market disruptions. Certain companies may be subject to economic","page_number":139,"box":{"x":116,"y":304,"width":762,"height":12}},{"id":"71e85117-9bce-4545-aaa2-026a00b6c708","block_type":"box","text":"or trade restrictions (but not investment restrictions) imposed by the U.S. or other governments due to","page_number":139,"box":{"x":116,"y":320,"width":761,"height":12}},{"id":"70c61993-af29-4c82-bd11-24c6963a57a7","block_type":"box","text":"national security, human rights or other concerns of such government. So long as these restrictions do","page_number":139,"box":{"x":117,"y":335,"width":764,"height":12}},{"id":"1bf23821-f418-4e26-8cac-580d04546986","block_type":"box","text":"not include restrictions on investments, the Fund may invest in such companies.","page_number":139,"box":{"x":117,"y":351,"width":599,"height":12}},{"id":"dcb3433e-e4a5-402c-80f0-751ba65174cf","block_type":"box","text":"The tax laws and regulations in the PRC are subject to change, including the issuance of authoritative","page_number":139,"box":{"x":116,"y":383,"width":760,"height":12}},{"id":"59755b21-a20e-4e4b-947f-54b020a6e16e","block_type":"box","text":"guidance or enforcement, possibly with retroactive effect. The interpretation, applicability and","page_number":139,"box":{"x":116,"y":399,"width":695,"height":12}},{"id":"4458083f-1ad7-442a-aced-d61d1737bc31","block_type":"box","text":"enforcement of such laws by PRC tax authorities are not as consistent and transparent as those of","page_number":139,"box":{"x":116,"y":414,"width":737,"height":12}},{"id":"99c64abe-7efc-467e-8a89-3bf42a2d101d","block_type":"box","text":"more developed nations, and may vary over time and from region to region. The application and","page_number":139,"box":{"x":117,"y":430,"width":716,"height":12}},{"id":"00910b2f-663c-4702-b490-7a23b4e312c3","block_type":"box","text":"enforcement of PRC tax rules could have a significant adverse effect on a Fund and its investors,","page_number":139,"box":{"x":116,"y":445,"width":727,"height":12}},{"id":"3dea20fd-72a4-48c8-a673-b59ca48ba9c6","block_type":"box","text":"particularly in relation to capital gains withholding tax imposed upon non-residents. In addition, the","page_number":139,"box":{"x":117,"y":461,"width":732,"height":12}},{"id":"2387e584-3337-4e08-b763-7d841d294836","block_type":"box","text":"accounting, auditing and financial reporting standards and practices applicable to Chinese companies","page_number":139,"box":{"x":116,"y":476,"width":759,"height":12}},{"id":"5cfe830e-338e-4b23-bca6-3f822240a511","block_type":"box","text":"may be less rigorous, and may result in significant differences between financial statements prepared","page_number":139,"box":{"x":117,"y":492,"width":757,"height":12}},{"id":"7f551bd6-ca1d-47af-b8d2-2966ac754436","block_type":"box","text":"in accordance with PRC accounting standards and practice and those prepared in accordance with","page_number":139,"box":{"x":117,"y":507,"width":739,"height":12}},{"id":"d7bf68bd-00eb-4126-bd90-231745dafe8e","block_type":"box","text":"international accounting standards.","page_number":139,"box":{"x":117,"y":523,"width":264,"height":12}},{"id":"ad234f9c-f202-42be-94f9-934a33abefe1","block_type":"box","text":"From time to time and in recent years, China has experienced outbreaks of infectious illnesses and the","page_number":139,"box":{"x":117,"y":555,"width":767,"height":13}},{"id":"96e17c0f-c02d-464a-9511-35e6b58fe210","block_type":"box","text":"country may be subject to other public health threats, infectious illnesses, diseases or similar issues in","page_number":139,"box":{"x":116,"y":571,"width":763,"height":12}},{"id":"96d60d87-bd45-4dca-896d-af3c0cb058b8","block_type":"box","text":"the future. Any spread of an infectious illness, public health threat or similar issue could reduce","page_number":139,"box":{"x":116,"y":586,"width":709,"height":13}},{"id":"d9016094-0063-446c-a12a-f48240701e84","block_type":"box","text":"consumer demand or economic output, result in market closures, travel restrictions or quarantines, and","page_number":139,"box":{"x":116,"y":602,"width":770,"height":12}},{"id":"500937e4-2699-4b10-824e-d55921271785","block_type":"box","text":"generally have a significant impact on the Chinese economy, which in turn could adversely affect a","page_number":139,"box":{"x":116,"y":617,"width":738,"height":13}},{"id":"9b7f4d2b-1554-4e99-adb9-9a029636eff1","block_type":"box","text":"Fund’s investments.","page_number":139,"box":{"x":117,"y":633,"width":153,"height":10}},{"id":"c923a80f-d5e9-4482-b10a-492266474946","block_type":"box","text":"Risk of Investing through Stock Connect.","page_number":139,"box":{"x":116,"y":666,"width":302,"height":12}},{"id":"c86f98ae-0d89-472a-a4a5-8c16cccb8c08","block_type":"box","text":"General.","page_number":139,"box":{"x":117,"y":690,"width":62,"height":9}},{"id":"e4dced3f-1b0a-4225-a83d-9d37bfb72e56","block_type":"box","text":"China A-shares are equity securities of companies domiciled in China that trade on Chinese","page_number":139,"box":{"x":186,"y":690,"width":681,"height":12}},{"id":"6f5afaec-7836-4e2e-aabc-a29660d7d788","block_type":"box","text":"stock exchanges such as the Shanghai Stock Exchange (“SSE”), the Shenzhen Stock Exchange","page_number":139,"box":{"x":116,"y":705,"width":718,"height":12}},{"id":"b424aa26-603e-47a5-9216-f990d55d7f8d","block_type":"box","text":"(“SZSE”) and the Beijing Stock Exchange (“BSE”) (“A-shares”). Foreign investment in A-shares on the","page_number":139,"box":{"x":117,"y":721,"width":756,"height":12}},{"id":"4e9fa1fd-3c5e-4729-9c01-7b3b94d39ab6","block_type":"box","text":"SSE and SZSE is not permitted, other than pursuant to available exceptions, such as through a","page_number":139,"box":{"x":116,"y":736,"width":707,"height":12}},{"id":"0b09a285-f1e5-4ebe-be75-fc071b8907c0","block_type":"box","text":"qualified foreign investor approved pursuant to the relevant mainland China laws and regulations as","page_number":139,"box":{"x":116,"y":752,"width":740,"height":12}},{"id":"36b3aaca-cba6-426a-a43d-0faf759a475b","block_type":"box","text":"may be promulgated and/or amended from time to time (“QFI”).","page_number":139,"box":{"x":117,"y":767,"width":468,"height":12}},{"id":"9884eb9f-9a7e-45c5-9213-31d2003f574f","block_type":"box","text":"Investment in eligible exchange traded funds and A-shares listed and traded on the SSE or SZSE","page_number":139,"box":{"x":117,"y":800,"width":723,"height":12}},{"id":"65e3f05e-5431-437b-8348-48aa271e86a4","block_type":"box","text":"(“Stock Connect Securities”) is also permitted through the Shanghai-Hong Kong Stock Connect","page_number":139,"box":{"x":117,"y":815,"width":706,"height":13}},{"id":"d40d719f-8ae5-489f-af2a-a02a008e6f6d","block_type":"box","text":"program or the Shenzhen-Hong Kong Stock Connect program, as applicable (each, a “Stock Connect”","page_number":139,"box":{"x":117,"y":831,"width":764,"height":12}},{"id":"5f73c40b-1ba3-4a72-ac28-24f9b725b0d8","block_type":"box","text":"and collectively, “Stock Connects”). Each Stock Connect is a securities trading and clearing links","page_number":139,"box":{"x":116,"y":846,"width":722,"height":13}},{"id":"e6c4a351-94b1-4c53-8e3d-1080ab9240f6","block_type":"box","text":"program established by The Stock Exchange of Hong Kong Limited (“SEHK”), the Hong Kong","page_number":139,"box":{"x":117,"y":862,"width":699,"height":12}},{"id":"b893f225-7995-46b9-a04d-13a418860b39","block_type":"box","text":"Securities Clearing Company Limited (“HKSCC”), the SSE or SZSE, as applicable, and China","page_number":139,"box":{"x":116,"y":877,"width":700,"height":13}},{"id":"f49cca9e-3eab-49b2-9771-027949a8407f","block_type":"box","text":"II-55","page_number":139,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"78c87b4f-cef1-4810-82be-42a14a5d67c3","block_type":"box","text":"NM0926U-5926888-139/257","page_number":139,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"93c3d993-bf92-42ff-a27f-cdbb13f5ba45","block_type":"box","text":"Securities Depository and Clearing Corporation Limited (“CSDCC”) that aims to provide mutual stock","page_number":140,"box":{"x":116,"y":87,"width":753,"height":12}},{"id":"5f4e9820-3622-4ecf-be9a-bc56e26767e0","block_type":"box","text":"market access between the PRC and Hong Kong by permitting investors to trade and settle shares on","page_number":140,"box":{"x":117,"y":102,"width":761,"height":13}},{"id":"28a46b2f-40b3-4b77-9bf5-c7186f9f89ae","block_type":"box","text":"each market through their local securities brokers. Under Stock Connects, a Fund’s trading of Stock","page_number":140,"box":{"x":116,"y":118,"width":746,"height":12}},{"id":"33514962-cece-4da9-b223-8db73dc624ae","block_type":"box","text":"Connect Securities listed on the SSE or SZSE, as applicable, would be effectuated through its Hong","page_number":140,"box":{"x":117,"y":134,"width":747,"height":12}},{"id":"e124fbc9-4b5f-41b3-864e-d2212fbb5e3d","block_type":"box","text":"Kong broker and a securities trading service company established by SEHK.","page_number":140,"box":{"x":117,"y":149,"width":572,"height":12}},{"id":"43ff1d9f-1655-4bff-9bdc-f8ab6734e6ac","block_type":"box","text":"Although no individual investment quotas or licensing requirements apply to investors in Stock","page_number":140,"box":{"x":116,"y":180,"width":703,"height":12}},{"id":"125beac9-ebfe-4d2e-9923-5a0f8c4c6f41","block_type":"box","text":"Connect, trading through a Stock Connect’s Northbound Trading Link is subject to daily investment","page_number":140,"box":{"x":117,"y":196,"width":738,"height":12}},{"id":"feb59748-d962-4b78-9c8e-cc19ca30e020","block_type":"box","text":"quota limitations which require that buy orders for Stock Connect Securities be rejected once the daily","page_number":140,"box":{"x":116,"y":211,"width":761,"height":12}},{"id":"e2e49547-1b06-4e9f-baba-9e54eafe3fd4","block_type":"box","text":"quota is exceeded (although a Fund will be permitted to sell their Stock Connect Securities regardless","page_number":140,"box":{"x":116,"y":227,"width":761,"height":12}},{"id":"6472e860-f083-412d-975a-b9b170b88e51","block_type":"box","text":"of the quota). These limitations may restrict a Fund from investing in Stock Connect Securities on a","page_number":140,"box":{"x":116,"y":242,"width":741,"height":12}},{"id":"96eb67be-d8e7-418f-8809-acefbb765f94","block_type":"box","text":"timely basis, which could affect the Fund’s ability to effectively pursue its investment strategy.","page_number":140,"box":{"x":116,"y":258,"width":698,"height":12}},{"id":"869c382c-bf9b-47e5-aafe-3f93d7818f8d","block_type":"box","text":"Investment quotas are also subject to change. Investment in Stock Connect Securities through a Stock","page_number":140,"box":{"x":117,"y":273,"width":767,"height":12}},{"id":"3db63cfa-cb4f-4036-921f-4cd6f78661e1","block_type":"box","text":"Connect is subject to trading, clearance and settlement procedures that could pose risks to a Fund.","page_number":140,"box":{"x":117,"y":289,"width":741,"height":12}},{"id":"dc788660-c3f7-49ea-8be5-66769258031a","block_type":"box","text":"Stock Connect Securities purchased through Stock Connects generally may not be sold or otherwise","page_number":140,"box":{"x":116,"y":304,"width":753,"height":12}},{"id":"46167483-a801-4031-bc2f-c023c3979cd9","block_type":"box","text":"transferred other than through Stock Connects in accordance with applicable rules. For example, the","page_number":140,"box":{"x":116,"y":320,"width":752,"height":12}},{"id":"bd99266a-826e-4ca4-a4d1-83319c090012","block_type":"box","text":"PRC regulations require that in order for an investor to sell any Stock Connect Securities on a certain","page_number":140,"box":{"x":117,"y":335,"width":755,"height":12}},{"id":"6c39dcc5-c331-48de-93b4-756eb9931123","block_type":"box","text":"trading day, there must be sufficient Stock Connect Securities in the investor’s account before the","page_number":140,"box":{"x":116,"y":351,"width":730,"height":12}},{"id":"dd3e9f4f-57d6-480b-9985-0b402342af18","block_type":"box","text":"market opens on that day. If there are insufficient Stock Connect Securities in the investor’s account,","page_number":140,"box":{"x":117,"y":366,"width":751,"height":12}},{"id":"a5eca3eb-27b5-4141-8631-1f63307ece0a","block_type":"box","text":"the sell order will be rejected by the SSE or SZSE, as applicable. SEHK carries out pre-trade checking","page_number":140,"box":{"x":116,"y":382,"width":765,"height":12}},{"id":"18f379ba-cb12-4de8-9085-7b2e2f002ecb","block_type":"box","text":"on sell orders of certain stocks listed on the SSE market (“SSE Securities”) or SZSE market (“SZSE","page_number":140,"box":{"x":116,"y":397,"width":746,"height":12}},{"id":"51631b70-435a-4c92-9bd8-ec211874610b","block_type":"box","text":"Securities”) of its participants (","page_number":140,"box":{"x":116,"y":413,"width":226,"height":12}},{"id":"0329c71d-775a-433a-91d8-e72cab6ec89a","block_type":"box","text":"i.e.","page_number":140,"box":{"x":343,"y":413,"width":20,"height":9}},{"id":"dea8877c-212d-4e33-8e03-718a045025e8","block_type":"box","text":", stock brokers) to ensure that this requirement is satisfied. While","page_number":140,"box":{"x":366,"y":413,"width":486,"height":12}},{"id":"13f5b172-b81f-4b94-af84-bd4ea13ef88b","block_type":"box","text":"shares must be designated as eligible to be traded under a Stock Connect, those shares may also lose","page_number":140,"box":{"x":116,"y":428,"width":770,"height":12}},{"id":"93dc8d19-562a-4eb2-8e9b-9a955adf37e3","block_type":"box","text":"such designation, and if this occurs, such shares may be sold but cannot be purchased through a","page_number":140,"box":{"x":116,"y":444,"width":728,"height":12}},{"id":"40d747e3-7459-4d50-829e-d77282c2ca08","block_type":"box","text":"Stock Connect. In addition, Stock Connects will only operate on days when both the Chinese and Hong","page_number":140,"box":{"x":116,"y":459,"width":771,"height":12}},{"id":"780e5069-a390-4e93-b690-e15ab3d5ce78","block_type":"box","text":"Kong markets are open for trading, and banking services are available in both markets on the","page_number":140,"box":{"x":117,"y":475,"width":698,"height":12}},{"id":"a9580191-52ad-443d-ae2e-35b7ca21edef","block_type":"box","text":"corresponding settlement days. Therefore, an investment in Stock Connect Securities through a Stock","page_number":140,"box":{"x":116,"y":490,"width":763,"height":12}},{"id":"a041d0b1-db8a-4010-b0ee-c5817ada0d36","block_type":"box","text":"Connect may subject a Fund to a risk of price fluctuations on days when the Chinese market is open,","page_number":140,"box":{"x":117,"y":506,"width":754,"height":12}},{"id":"04bb8629-57d2-41ca-8387-a8e2a9046089","block_type":"box","text":"but a Stock Connect is not trading. Moreover, day (turnaround) trading is not permitted on the Stock","page_number":140,"box":{"x":117,"y":521,"width":745,"height":12}},{"id":"2998da8b-6f40-4bff-aa70-b818b202b8ab","block_type":"box","text":"Connect Securities market. If an investor buys Stock Connect Securities on day “T,” the investor will","page_number":140,"box":{"x":117,"y":537,"width":746,"height":12}},{"id":"e54b606c-353b-4c76-8596-734bd3aba6b8","block_type":"box","text":"only be able to sell the Stock Connect Securities on or after day T+1. Further, since all trades of Stock","page_number":140,"box":{"x":116,"y":552,"width":763,"height":12}},{"id":"853e4b74-fa3e-4d38-92ad-c14dafa2caec","block_type":"box","text":"Connect Securities must be settled in RMB, investors must have timely access to a reliable supply of","page_number":140,"box":{"x":117,"y":568,"width":752,"height":12}},{"id":"9979a5cd-f80f-4092-9830-c6308c70d9d7","block_type":"box","text":"offshore RMB, which cannot be guaranteed. There is also no assurance that RMB will not be subject to","page_number":140,"box":{"x":116,"y":583,"width":771,"height":12}},{"id":"423d9c2c-0829-4975-879c-5497c068dc74","block_type":"box","text":"devaluation. Any devaluation of RMB could adversely affect a Fund’s investments. If a Fund holds a","page_number":140,"box":{"x":116,"y":599,"width":746,"height":12}},{"id":"e5ac8314-83f4-40a7-853b-cbff13320fb2","block_type":"box","text":"class of shares denominated in a local currency other than RMB, the Fund will be exposed to currency","page_number":140,"box":{"x":116,"y":614,"width":765,"height":12}},{"id":"89cebdd6-9a1d-4867-861b-5be8ac72adfb","block_type":"box","text":"exchange risk if the Fund converts the local currency into RMB for investments in Stock Connect","page_number":140,"box":{"x":116,"y":630,"width":722,"height":12}},{"id":"fa84c922-3fb4-4c2d-a855-1bb0be0be31c","block_type":"box","text":"Securities. A Fund may also incur conversion costs.","page_number":140,"box":{"x":116,"y":645,"width":390,"height":12}},{"id":"e9fe5356-3ede-4057-96d7-3e79afc9b378","block_type":"box","text":"Stock Connect Securities held through the nominee structure under a Stock Connect will be held","page_number":140,"box":{"x":116,"y":676,"width":716,"height":12}},{"id":"69b788df-9b2b-4a56-9ffe-100772420b62","block_type":"box","text":"through HKSCC as nominee on behalf of investors. The precise nature and rights of a Fund as the","page_number":140,"box":{"x":116,"y":692,"width":731,"height":12}},{"id":"192b56f9-780f-4a3a-bb35-3e38a2880cbd","block_type":"box","text":"beneficial owner of the SSE Securities or SZSE Securities through HKSCC as nominee is not well","page_number":140,"box":{"x":117,"y":707,"width":725,"height":12}},{"id":"f9af4765-658b-4819-9cee-05577fd72cb8","block_type":"box","text":"defined under the PRC laws. There is a lack of a clear definition of, and distinction between, legal","page_number":140,"box":{"x":116,"y":723,"width":722,"height":12}},{"id":"9bcc93a8-6195-4415-8e95-76d536fe57e0","block_type":"box","text":"ownership and beneficial ownership under the PRC laws and there have been few cases involving a","page_number":140,"box":{"x":116,"y":738,"width":742,"height":12}},{"id":"b8ae28f2-5a84-431a-a216-dbd42c245c98","block_type":"box","text":"nominee account structure in the PRC courts. The exact nature and methods of enforcement of the","page_number":140,"box":{"x":117,"y":754,"width":735,"height":9}},{"id":"9161e1d1-8693-4206-86f6-29befe3f29ff","block_type":"box","text":"rights and interests of a Fund under the PRC laws is also uncertain. In the unlikely event that HKSCC","page_number":140,"box":{"x":117,"y":769,"width":751,"height":12}},{"id":"f57f25dd-db17-4718-88d1-bf5e06f98ccc","block_type":"box","text":"becomes subject to winding up proceedings in Hong Kong, there is a risk that the SSE Securities or","page_number":140,"box":{"x":117,"y":785,"width":739,"height":12}},{"id":"4dffec4b-292f-404f-8892-a20dba89510a","block_type":"box","text":"SZSE Securities may not be regarded as held for the beneficial ownership of a Fund or as part of the","page_number":140,"box":{"x":116,"y":800,"width":749,"height":12}},{"id":"752294b8-03f0-46e7-90be-79f40dbdb4e2","block_type":"box","text":"general assets of HKSCC available for general distribution to its creditors. Notwithstanding the fact that","page_number":140,"box":{"x":116,"y":816,"width":765,"height":12}},{"id":"06b744d3-97f9-4fb9-a3ad-8451d4af22ce","block_type":"box","text":"HKSCC does not claim proprietary interests in the SSE Securities or SZSE Securities held in its","page_number":140,"box":{"x":117,"y":831,"width":714,"height":12}},{"id":"8ae4667c-873a-46ee-b89c-9a5ba295e3d0","block_type":"box","text":"omnibus stock account in the CSDCC, the CSDCC as the share registrar for SSE- or SZSE-listed","page_number":140,"box":{"x":116,"y":847,"width":729,"height":12}},{"id":"5bb7b620-5454-4c47-807f-3c02c839c7d4","block_type":"box","text":"companies will still treat HKSCC as one of the shareholders when it handles corporate actions in","page_number":140,"box":{"x":116,"y":862,"width":722,"height":12}},{"id":"a1e09a58-9e62-4f4b-b265-49b699b9ff82","block_type":"box","text":"respect of such SSE Securities or SZSE Securities. HKSCC monitors the corporate actions affecting","page_number":140,"box":{"x":117,"y":878,"width":749,"height":12}},{"id":"2e986061-bab4-4b81-b994-e1fa21a66291","block_type":"box","text":"II-56","page_number":140,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"ecf155e0-a38a-4de6-b8e9-77634436af77","block_type":"box","text":"NM0926U-5926888-140/257","page_number":140,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"f743f2c0-32c1-4856-acd3-5aa0c68f3b92","block_type":"box","text":"SSE Securities and SZSE Securities and keeps participants of Central Clearing and Settlement","page_number":141,"box":{"x":116,"y":87,"width":712,"height":12}},{"id":"48f36876-b415-4e7f-b20a-0da2d523fcc0","block_type":"box","text":"System (“CCASS”) informed of all such corporate actions that require CCASS participants to take","page_number":141,"box":{"x":116,"y":102,"width":729,"height":13}},{"id":"212eb62e-9492-458d-aeee-f6589a363720","block_type":"box","text":"steps in order to participate in them. Investors may only exercise their voting rights by providing their","page_number":141,"box":{"x":116,"y":118,"width":750,"height":12}},{"id":"e6db0ee6-a0c7-47ee-87b5-6661b6458fcd","block_type":"box","text":"voting instructions to HKSCC through participants of CCASS. All voting instructions from CCASS","page_number":141,"box":{"x":116,"y":134,"width":724,"height":12}},{"id":"72ad1152-5d2e-4ca8-9c26-da5b961088e5","block_type":"box","text":"participants will be consolidated by HKSCC, who will then submit a combined single voting instruction","page_number":141,"box":{"x":117,"y":149,"width":757,"height":12}},{"id":"c3281bd0-ca79-497f-8e5c-24c9d3c39d62","block_type":"box","text":"to the relevant SSE- or SZSE-listed company. As a result, a Fund may suffer difficulties or delays in","page_number":141,"box":{"x":116,"y":165,"width":745,"height":12}},{"id":"11b40775-f1e2-4303-a6e9-47e21493c4b3","block_type":"box","text":"enforcing its rights in SSE Securities or SZSE Securities.","page_number":141,"box":{"x":116,"y":180,"width":427,"height":12}},{"id":"1ab8763b-b8b8-4fd5-8135-c5688332f118","block_type":"box","text":"Hong Kong’s Investor Compensation Fund is established to pay compensation to investors of any","page_number":141,"box":{"x":117,"y":211,"width":728,"height":12}},{"id":"5ae015f0-83ba-486d-b265-38c7e803d1b9","block_type":"box","text":"nationality who suffer pecuniary losses as a result of default of a licensed intermediary or authorized","page_number":141,"box":{"x":117,"y":227,"width":747,"height":12}},{"id":"a0c05955-e86e-4958-9f3e-cf616abd554e","block_type":"box","text":"financial institution in relation to exchange-traded products in Hong Kong. For defaults occurring on or","page_number":141,"box":{"x":116,"y":242,"width":760,"height":12}},{"id":"21b94064-44cf-482d-9121-a2f7cdda3947","block_type":"box","text":"after January 1, 2020, Hong Kong’s Investor Compensation Fund covers investors’ losses in relation to","page_number":141,"box":{"x":116,"y":258,"width":769,"height":12}},{"id":"a1d79d6c-acef-4e07-9476-5f83a6c73a9a","block_type":"box","text":"securities (i) that are traded on the SSE or the SZSE and (ii) in respect of which an order for sale or","page_number":141,"box":{"x":116,"y":273,"width":743,"height":12}},{"id":"4f3c708b-2fa3-4106-ba75-313cd32d69e4","block_type":"box","text":"purchase is permitted to be routed through the Northbound Trading Link of a Stock Connect. On the","page_number":141,"box":{"x":117,"y":289,"width":746,"height":12}},{"id":"060da0b5-dac0-4eee-a3ef-ecf3f7a869fb","block_type":"box","text":"other hand, since a Fund carries out Northbound trading through securities brokers in Hong Kong but","page_number":141,"box":{"x":116,"y":304,"width":756,"height":12}},{"id":"ee62a29f-bffb-4899-b04f-81569c681120","block_type":"box","text":"not PRC brokers, it is not protected by the China Securities Investor Protection Fund in the PRC.","page_number":141,"box":{"x":117,"y":320,"width":722,"height":12}},{"id":"f95737c9-fc93-4477-86c5-205691bc2b39","block_type":"box","text":"Market participants are able to participate in Stock Connects subject to meeting certain information","page_number":141,"box":{"x":117,"y":351,"width":737,"height":12}},{"id":"36a4ff68-7162-4af6-95c7-1597211a039c","block_type":"box","text":"technology capability, risk management and other requirements as may be specified by the relevant","page_number":141,"box":{"x":116,"y":366,"width":746,"height":12}},{"id":"848db031-e8bd-4e71-8c40-83d37c6133cf","block_type":"box","text":"exchange and/or clearing house. Further, the “connectivity” in Stock Connects requires routing of","page_number":141,"box":{"x":116,"y":382,"width":725,"height":12}},{"id":"bce61973-cfa5-4fd7-801d-6d92e6692aaa","block_type":"box","text":"orders across the border of Hong Kong and the PRC. This requires the development of new","page_number":141,"box":{"x":116,"y":397,"width":687,"height":12}},{"id":"f78fbd7e-43e4-48ce-ae5f-dd6d271643ad","block_type":"box","text":"information technology systems on the part of SEHK and exchange participants. There is no assurance","page_number":141,"box":{"x":117,"y":413,"width":771,"height":12}},{"id":"2799aa4b-ba28-4d4b-947f-302386b5f89c","block_type":"box","text":"that the systems of SEHK and market participants will function properly or will continue to be adapted","page_number":141,"box":{"x":116,"y":428,"width":757,"height":12}},{"id":"7b9f7ccc-9a33-4aba-81cf-aaee3de4f4f6","block_type":"box","text":"to changes and developments in both markets. In the event that the relevant systems fail to function","page_number":141,"box":{"x":116,"y":444,"width":747,"height":12}},{"id":"4b6d95d2-d9c2-4833-8c6c-5e70e507ebec","block_type":"box","text":"properly, trading in Stock Connect Securities through Stock Connects could be disrupted.","page_number":141,"box":{"x":117,"y":459,"width":667,"height":12}},{"id":"b9efd0d9-8d23-4fb8-8274-efc62559bb08","block_type":"box","text":"The Shanghai-Hong Kong Stock Connect program launched in November 2014 and the Shenzhen","page_number":141,"box":{"x":116,"y":490,"width":737,"height":12}},{"id":"61c7e8d7-1e76-4a35-91f4-8fd5bb2960c8","block_type":"box","text":"Hong Kong Stock Connect program launched in December 2016. Each program does not have an","page_number":141,"box":{"x":117,"y":506,"width":733,"height":12}},{"id":"307cd2d2-9c57-4bca-bf06-2b55ae092a5e","block_type":"box","text":"extensive operating history. New or revised regulations may be issued from time to time by the","page_number":141,"box":{"x":116,"y":521,"width":707,"height":12}},{"id":"212a601f-6993-4d4e-8ea5-f3cdb983b956","block_type":"box","text":"regulators and stock exchanges in China and Hong Kong in connection with operations, legal","page_number":141,"box":{"x":117,"y":537,"width":695,"height":12}},{"id":"ebf2fceb-c32c-4892-ad37-16404b73e1d7","block_type":"box","text":"enforcement and cross-border trades under Stock Connects. In addition, there can be no assurance","page_number":141,"box":{"x":116,"y":552,"width":748,"height":11}},{"id":"222b7b23-2639-457d-ae12-29921e5f26c2","block_type":"box","text":"that Stock Connect will not be discontinued. A Fund may be adversely affected as a result of such","page_number":141,"box":{"x":116,"y":568,"width":731,"height":12}},{"id":"27e0a5f6-116a-4709-a318-557ece970197","block_type":"box","text":"changes. Furthermore, the securities regimes and legal systems of China and Hong Kong differ","page_number":141,"box":{"x":116,"y":583,"width":714,"height":12}},{"id":"fe4cd543-06da-4fc3-b413-81cb5e9ba071","block_type":"box","text":"significantly and issues may arise from the differences on an on-going basis. In the event that the","page_number":141,"box":{"x":116,"y":599,"width":727,"height":12}},{"id":"0c7f29c3-e13b-431f-acb2-093dfc6fc7f0","block_type":"box","text":"relevant systems fail to function properly, trading in both markets through Stock Connects could be","page_number":141,"box":{"x":117,"y":614,"width":737,"height":12}},{"id":"09c35b5b-5e25-4af4-8a7c-d63ca0b43944","block_type":"box","text":"disrupted and a Fund’s ability to achieve its investment objective may be adversely affected. In","page_number":141,"box":{"x":116,"y":630,"width":708,"height":12}},{"id":"d7b5bbc2-548b-48ed-a21a-aa0f1c728ff9","block_type":"box","text":"addition, a Fund’s investments in Stock Connect Securities through Stock Connects are generally","page_number":141,"box":{"x":116,"y":645,"width":728,"height":12}},{"id":"e0665644-087d-4109-b08e-e693e4548e7b","block_type":"box","text":"subject to Chinese securities regulations and listing rules, among other restrictions. Further, different","page_number":141,"box":{"x":116,"y":661,"width":746,"height":12}},{"id":"4d59119d-2c82-478b-8769-c8320189dac6","block_type":"box","text":"fees, costs and taxes are imposed on foreign investors acquiring Stock Connect Securities through","page_number":141,"box":{"x":116,"y":676,"width":733,"height":12}},{"id":"91b899f4-704e-4d26-b6d8-2c9c44836e38","block_type":"box","text":"Stock Connects, and these fees, costs and taxes may be higher than comparable fees, costs and","page_number":141,"box":{"x":116,"y":692,"width":722,"height":12}},{"id":"0e36cf91-6001-40c4-850b-b129a823c595","block_type":"box","text":"taxes imposed on owners of other securities providing similar investment exposure.","page_number":141,"box":{"x":116,"y":707,"width":618,"height":12}},{"id":"dacebc7b-7236-4b0c-951f-4468bde68376","block_type":"box","text":"Suspension Risk.","page_number":141,"box":{"x":117,"y":738,"width":127,"height":12}},{"id":"13501af0-7fe6-4d38-a4cf-f0891dd636ae","block_type":"box","text":"SSE Securities and SZSE Securities may only be bought from, or sold to, a Fund at","page_number":141,"box":{"x":251,"y":738,"width":620,"height":12}},{"id":"55ec87ce-02ba-44ab-af1d-26bb3cd55dff","block_type":"box","text":"times when the relevant SSE Securities and SZSE Securities may be sold or purchased on the","page_number":141,"box":{"x":116,"y":754,"width":704,"height":12}},{"id":"e264c34e-8273-4632-86eb-346e0e753eee","block_type":"box","text":"relevant Chinese stock exchange. The SSE Securities and SZSE Securities markets have a higher","page_number":141,"box":{"x":117,"y":769,"width":733,"height":12}},{"id":"c86a1374-79bb-4cea-86b0-7204edc7d906","block_type":"box","text":"propensity for trading suspensions than many other global equity markets. Each of the SEHK, SSE and","page_number":141,"box":{"x":117,"y":785,"width":765,"height":12}},{"id":"e21e22dc-d25f-4651-8fa9-7ea85bd2870f","block_type":"box","text":"SZSE reserves the right to suspend trading of SSE Securities and SZSE Securities purchased on the","page_number":141,"box":{"x":116,"y":800,"width":751,"height":12}},{"id":"74d71c16-a367-44d3-a330-3bd428a2046f","block_type":"box","text":"Stock Connects if necessary for ensuring an orderly and fair market and ensuring that risks are","page_number":141,"box":{"x":116,"y":816,"width":705,"height":12}},{"id":"d3c9ec8b-2389-4e31-bed3-72510e0ae409","block_type":"box","text":"managed prudently. Consent from the relevant regulator would be sought before a suspension of","page_number":141,"box":{"x":117,"y":831,"width":724,"height":12}},{"id":"8320e900-c8ef-48f5-82bb-b92c68d40c95","block_type":"box","text":"Northbound trading is triggered. The relevant PRC government authority may also impose “circuit","page_number":141,"box":{"x":117,"y":847,"width":727,"height":12}},{"id":"0b39c033-7cc7-4eda-80f9-b565f2eab5dd","block_type":"box","text":"breakers” and other measures to halt or suspend Northbound trading. Where a suspension in the","page_number":141,"box":{"x":117,"y":862,"width":725,"height":12}},{"id":"bcafd101-114f-4230-aca0-d04fc07c9795","block_type":"box","text":"Northbound trading through Stock Connect is effected, the Fund’s ability to access the PRC market will","page_number":141,"box":{"x":117,"y":878,"width":769,"height":12}},{"id":"425e5952-8df2-4508-a03b-26480dd82fcb","block_type":"box","text":"II-57","page_number":141,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"849777c3-deb5-4372-8f99-c4c14abde445","block_type":"box","text":"NM0926U-5926888-141/257","page_number":141,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"5fd33ed0-3fc5-42e6-a902-931b83a74d3d","block_type":"box","text":"be adversely affected. Trading suspensions in certain stocks could lead to greater market execution","page_number":142,"box":{"x":117,"y":87,"width":745,"height":12}},{"id":"9a26132e-92e7-449a-ba27-236c962a9515","block_type":"box","text":"risk and costs for a Fund. The SSE and SZSE currently","page_number":142,"box":{"x":117,"y":102,"width":415,"height":13}},{"id":"ee49ed93-0f80-45f0-9dd2-4d0acd94d50c","block_type":"box","text":"apply a daily price limit, generally set at 10%,","page_number":142,"box":{"x":533,"y":102,"width":340,"height":13}},{"id":"4871f5f6-9a28-4097-8bbe-d675242691a0","block_type":"box","text":"of the amount of fluctuation permitted in the prices of the relevant SSE Securities and SZSE Securities","page_number":142,"box":{"x":116,"y":118,"width":766,"height":12}},{"id":"a2748974-6f3a-443c-add8-6baf3b2f944c","block_type":"box","text":"during a single trading day. The daily price limit refers to price movements only and does not restrict","page_number":142,"box":{"x":116,"y":134,"width":747,"height":12}},{"id":"bdc59b95-1af5-44c1-a290-9a5c56cfffd2","block_type":"box","text":"trading within the relevant limit. There can be no assurance that a liquid market on an exchange will","page_number":142,"box":{"x":116,"y":149,"width":744,"height":12}},{"id":"69e0105c-ff65-418b-bdaf-aeba44cf24f5","block_type":"box","text":"exist for any particular SSE Security or SZSE Security or for any particular time.","page_number":142,"box":{"x":116,"y":165,"width":598,"height":12}},{"id":"c03a2900-99e4-485d-a2b5-33f5b2bff2b7","block_type":"box","text":"Risk of Investing in the China Interbank Bond Market through Bond Connect.","page_number":142,"box":{"x":116,"y":192,"width":575,"height":12}},{"id":"eaa92686-6117-4223-886c-c038b97911e8","block_type":"box","text":"A Fund may invest","page_number":142,"box":{"x":691,"y":192,"width":144,"height":12}},{"id":"6903b963-5a96-4bf3-9f9e-3db25914afee","block_type":"box","text":"directly in the domestic bond market in the PRC (the “China Interbank Bond Market”) through the","page_number":142,"box":{"x":116,"y":207,"width":724,"height":12}},{"id":"40e3dcd1-eb6d-4619-bdba-16165a24e966","block_type":"box","text":"northbound trading of Bond Connect (“Bond Connect”). Bond Connect is an initiative launched in July","page_number":142,"box":{"x":117,"y":223,"width":755,"height":12}},{"id":"08efc42e-a195-4e42-850b-b3c4c8285ccd","block_type":"box","text":"2017 for mutual bond market access between the PRC and Hong Kong, established by the China","page_number":142,"box":{"x":116,"y":238,"width":729,"height":12}},{"id":"213da143-df4c-4ce0-b62e-4c30f056f3fd","block_type":"box","text":"Foreign Exchange Trade System & National Interbank Funding Centre (“CFETS”), China Central","page_number":142,"box":{"x":117,"y":254,"width":722,"height":12}},{"id":"e034bd17-e467-4c61-b85e-1e8901d9c862","block_type":"box","text":"Depository & Clearing Co., Ltd (“CDCC”), Shanghai Clearing House (“SCH”), Hong Kong Exchanges","page_number":142,"box":{"x":117,"y":269,"width":752,"height":12}},{"id":"2ad52ff1-8f14-41b9-b511-4cb7b504b274","block_type":"box","text":"and Clearing Limited (“HKEX”) and Central Moneymarkets Unit (“CMU”). Under the prevailing","page_number":142,"box":{"x":116,"y":285,"width":699,"height":12}},{"id":"ec797bd4-8f42-444c-99b3-e66a60a9fd27","block_type":"box","text":"regulations in the PRC, eligible foreign investors are allowed to invest in the bonds circulated in the","page_number":142,"box":{"x":117,"y":300,"width":738,"height":12}},{"id":"d61a8a89-0fec-43d1-a664-3111d0ba4401","block_type":"box","text":"China Interbank Bond Market through Bond Connect. Eligible foreign investors may submit trade","page_number":142,"box":{"x":117,"y":316,"width":721,"height":12}},{"id":"27819641-422f-490d-9f6c-2de8da13b64f","block_type":"box","text":"requests for bonds circulated in the China Interbank Bond Market through offshore electronic bond","page_number":142,"box":{"x":117,"y":331,"width":735,"height":12}},{"id":"807658c3-2296-461e-b25e-bb4b05026051","block_type":"box","text":"trading platforms (such as Tradeweb), which will in turn transmit their requests for quotation to CFETS.","page_number":142,"box":{"x":116,"y":347,"width":768,"height":12}},{"id":"77f4093f-e072-4c3a-a75d-88282e902579","block_type":"box","text":"CFETS will send the requests for quotation to a number of approved onshore dealers (including market","page_number":142,"box":{"x":117,"y":362,"width":770,"height":12}},{"id":"903945eb-040e-4953-a091-3bbb51b375bc","block_type":"box","text":"makers and others engaged in the market making business) in the PRC. The approved onshore","page_number":142,"box":{"x":117,"y":378,"width":715,"height":12}},{"id":"3c5e16a1-5dfe-4190-aa67-34f99c86acda","block_type":"box","text":"dealer(s) will respond to the requests for quotation via CFETS and CFETS will send their responses to","page_number":142,"box":{"x":116,"y":393,"width":765,"height":12}},{"id":"a669135c-b828-4091-ab87-6061c8764b57","block_type":"box","text":"those eligible foreign investors through the same offshore electronic bond trading platforms. Once the","page_number":142,"box":{"x":116,"y":409,"width":759,"height":12}},{"id":"47f3d47d-16ed-4df1-b6ef-b0de171ac70b","block_type":"box","text":"eligible foreign investor accepts the quotation, the trade is concluded on CFETS.","page_number":142,"box":{"x":116,"y":424,"width":603,"height":12}},{"id":"02472bfc-67cd-47c2-8b61-636f12e7b75d","block_type":"box","text":"The settlement and custody of bonds traded in the China Interbank Bond Market under Bond Connect","page_number":142,"box":{"x":116,"y":451,"width":761,"height":12}},{"id":"b5e62c64-5a5e-424e-a862-8a64716e0447","block_type":"box","text":"will be effected through the settlement and custody link between CMU, as an offshore custody agent,","page_number":142,"box":{"x":116,"y":467,"width":755,"height":12}},{"id":"c811ef83-8e73-45cf-9cf7-8f3e63d69cd0","block_type":"box","text":"and CDCC and SCH, as onshore custodians and clearing institutions in the PRC. Under the settlement","page_number":142,"box":{"x":116,"y":482,"width":768,"height":12}},{"id":"569ec56d-0acc-4de6-a45c-83f69052b261","block_type":"box","text":"link, CDCC or SCH will effect gross settlement of confirmed trades onshore and CMU will process","page_number":142,"box":{"x":117,"y":498,"width":730,"height":12}},{"id":"79d2f2fb-8c75-4663-b33b-3cde5c531c44","block_type":"box","text":"bond settlement instructions from CMU members on behalf of eligible foreign investors in accordance","page_number":142,"box":{"x":117,"y":513,"width":757,"height":12}},{"id":"22931cff-c73a-4111-80c6-8ce032c45b5f","block_type":"box","text":"with its relevant rules. Since the introduction in August 2018 of delivery versus payment (DVP)","page_number":142,"box":{"x":116,"y":529,"width":705,"height":12}},{"id":"c020c56b-eb39-46eb-93af-050cc36c6290","block_type":"box","text":"settlement in respect of Bond Connect, the movement of cash and securities is carried out","page_number":142,"box":{"x":116,"y":544,"width":675,"height":12}},{"id":"e0a96052-6232-4c48-af33-63639b46983d","block_type":"box","text":"simultaneously on a real-time basis. Pursuant to the prevailing regulations in the PRC, CMU, as the","page_number":142,"box":{"x":116,"y":560,"width":743,"height":12}},{"id":"f1501073-5c03-40fd-8aa4-65d642d8f274","block_type":"box","text":"offshore custody agent recognized by the Hong Kong Monetary Authority, will open omnibus nominee","page_number":142,"box":{"x":116,"y":575,"width":759,"height":12}},{"id":"623d0215-b8ba-42b2-91ba-0732c7735d53","block_type":"box","text":"accounts with the onshore custody agent recognized by the People’s Bank of China (","page_number":142,"box":{"x":116,"y":591,"width":631,"height":12}},{"id":"e3b15065-d40f-4544-b349-f7d114a413d9","block_type":"box","text":"i.e.","page_number":142,"box":{"x":749,"y":591,"width":20,"height":9}},{"id":"dce8e8a8-74c8-45c7-81df-1dd2a181bb58","block_type":"box","text":", CDCC and","page_number":142,"box":{"x":772,"y":591,"width":94,"height":11}},{"id":"eb7aadd1-21ec-4322-9125-08252c2b81cb","block_type":"box","text":"SCH). All bonds traded by eligible foreign investors through Bond Connect will be registered in the","page_number":142,"box":{"x":116,"y":606,"width":734,"height":12}},{"id":"563414c2-4674-4ca1-97cf-a28ab1ace8e6","block_type":"box","text":"name of CMU, which will hold such bonds as a nominee owner. Therefore, a Fund will be exposed to","page_number":142,"box":{"x":117,"y":622,"width":754,"height":12}},{"id":"bc3d370d-8f0c-40b2-8fe8-ad564665d069","block_type":"box","text":"custody risks with respect to CMU. In the remote event of a CDCC or SCH default, CMU’s liabilities in","page_number":142,"box":{"x":116,"y":637,"width":759,"height":12}},{"id":"cfbc8b83-7aba-4dc0-9592-fdede636d41b","block_type":"box","text":"Bond Connect bonds under its market contracts with clearing participants will be limited to assisting","page_number":142,"box":{"x":117,"y":653,"width":741,"height":12}},{"id":"7bc8ddce-b324-4227-b008-a6b54bb2c146","block_type":"box","text":"clearing participants in pursuing their claims against CDCC or SCH. The Fund may suffer delay in the","page_number":142,"box":{"x":116,"y":668,"width":753,"height":12}},{"id":"4a4ecf2e-be64-4a05-9ef8-edde9a1589a8","block_type":"box","text":"recovery process or may not fully recover its losses from CDCC or SCH. In addition, as the relevant","page_number":142,"box":{"x":117,"y":684,"width":739,"height":12}},{"id":"fb3ffdc2-1185-40dc-91b1-d55d17274849","block_type":"box","text":"filings, registration with the People’s Bank of China, and account opening have to be carried out by","page_number":142,"box":{"x":116,"y":699,"width":733,"height":13}},{"id":"dd874229-d2a0-4eb3-99b7-30aeb522c16c","block_type":"box","text":"third parties, including CMU, CDCC, SCH, and CFETS, a Fund is subject to the risks of default or","page_number":142,"box":{"x":116,"y":715,"width":723,"height":12}},{"id":"4aeea771-f890-4d58-b43b-f4f41d7b6c1d","block_type":"box","text":"errors on the part of such third parties.","page_number":142,"box":{"x":116,"y":730,"width":284,"height":12}},{"id":"82effa95-8972-4c24-b4f4-167a9edb911a","block_type":"box","text":"The precise nature and rights of a Fund as the beneficial owner of the bonds traded in the China","page_number":142,"box":{"x":116,"y":758,"width":715,"height":12}},{"id":"9b16b3e9-b2c0-484f-9d6b-35a99f7eb186","block_type":"box","text":"Interbank Bond Market through CMU as nominee is not well-defined under PRC law. There is a lack of","page_number":142,"box":{"x":117,"y":773,"width":761,"height":12}},{"id":"d51d5fc3-139a-4835-8024-dd60f426d005","block_type":"box","text":"a clear definition of, and distinction between, legal ownership and beneficial ownership under PRC law","page_number":142,"box":{"x":116,"y":789,"width":760,"height":12}},{"id":"979d00e5-1607-4ede-9aef-5b9069cae10b","block_type":"box","text":"and there have been few cases involving a nominee account structure in the PRC courts. The exact","page_number":142,"box":{"x":116,"y":804,"width":741,"height":12}},{"id":"5d3af951-a9cb-4d59-86be-1fc87d61a3cd","block_type":"box","text":"nature and methods of enforcement of the rights and interests of a Fund under PRC law are also","page_number":142,"box":{"x":117,"y":820,"width":717,"height":12}},{"id":"e5253d3f-3453-457a-81db-8035fa53cd4d","block_type":"box","text":"uncertain.","page_number":142,"box":{"x":117,"y":835,"width":77,"height":10}},{"id":"2ce13fe3-0348-4bc0-9dca-1ffc293f04be","block_type":"box","text":"Market volatility and potential lack of liquidity due to low trading volume of certain bonds in the China","page_number":142,"box":{"x":117,"y":862,"width":750,"height":12}},{"id":"f343c91d-3113-449c-ad45-fe40c98e0dd5","block_type":"box","text":"Interbank Bond Market may result in prices of certain bonds traded on such market fluctuating","page_number":142,"box":{"x":117,"y":878,"width":702,"height":12}},{"id":"bfd67c5b-8980-4c86-9136-9197324fbbbc","block_type":"box","text":"II-58","page_number":142,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"faec366e-1884-4f68-9f95-42f1cd327176","block_type":"box","text":"NM0926U-5926888-142/257","page_number":142,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"d4b04ee9-4e81-4457-b550-32da3cb47a6f","block_type":"box","text":"significantly. A Fund investing in such market is therefore subject to liquidity and volatility risks. The","page_number":143,"box":{"x":116,"y":87,"width":742,"height":12}},{"id":"06e2abb5-c6a4-4329-858c-c85fcaf5169b","block_type":"box","text":"bid-ask spreads of the prices of such securities may be large, and a Fund may therefore incur","page_number":143,"box":{"x":117,"y":102,"width":700,"height":13}},{"id":"29f7ce5e-9bc1-4756-b646-4cbe12d72ba5","block_type":"box","text":"significant costs and may suffer losses when selling such investments. The bonds traded in the China","page_number":143,"box":{"x":116,"y":118,"width":759,"height":12}},{"id":"9b2dda5c-c8c7-40af-8ddd-dcab46c0506e","block_type":"box","text":"Interbank Bond Market may be difficult or impossible to sell, which may impact a Fund’s ability to","page_number":143,"box":{"x":117,"y":134,"width":722,"height":12}},{"id":"4a2643f7-c2b4-4d88-b707-3d9c65cc4e4d","block_type":"box","text":"acquire or dispose of such securities at their expected prices.","page_number":143,"box":{"x":116,"y":149,"width":460,"height":12}},{"id":"f70f2f48-9bd7-455d-a24d-41b0c0a479d5","block_type":"box","text":"Investing in the China Interbank Bond Market through Bond Connect is also subject to regulatory risks.","page_number":143,"box":{"x":117,"y":177,"width":766,"height":12}},{"id":"e552abe6-d85b-49bc-abed-151c4779481b","block_type":"box","text":"The relevant rules and regulations are subject to change, which may have potential retrospective","page_number":143,"box":{"x":116,"y":193,"width":724,"height":12}},{"id":"0e3b57f6-896a-4cd6-b9cf-2479da6ae92c","block_type":"box","text":"effect, and there can be no assurance that Bond Connect will not be discontinued or abolished.","page_number":143,"box":{"x":116,"y":208,"width":711,"height":11}},{"id":"d4cb7901-da8e-4edc-a710-a8156dcf0416","block_type":"box","text":"Furthermore, the securities regimes and legal systems of China and Hong Kong differ significantly and","page_number":143,"box":{"x":117,"y":223,"width":764,"height":13}},{"id":"a685369d-e423-4061-a5f5-d021d5e270d2","block_type":"box","text":"issues may arise based on these differences. In the event that the relevant authorities suspend","page_number":143,"box":{"x":117,"y":239,"width":709,"height":12}},{"id":"b8709ef2-cdb5-4e68-bbb0-a8c3f3f61357","block_type":"box","text":"account opening or trading on the China Interbank Bond Market, a Fund’s ability to invest in the China","page_number":143,"box":{"x":116,"y":254,"width":762,"height":13}},{"id":"2a886d3c-11dd-45e0-ab63-4a08dc042e93","block_type":"box","text":"Interbank Bond Market will be adversely affected and limited. In such event, the Fund’s ability to","page_number":143,"box":{"x":117,"y":270,"width":716,"height":12}},{"id":"0a616800-4e5c-4812-810e-dbf6f82fbdde","block_type":"box","text":"achieve its investment objective will be negatively affected and, after exhausting other trading","page_number":143,"box":{"x":116,"y":285,"width":699,"height":13}},{"id":"113f9d1a-1d3a-45f4-8217-567906e509e8","block_type":"box","text":"alternatives, the Fund may suffer substantial losses as a result. Further, if Bond Connect is not","page_number":143,"box":{"x":116,"y":301,"width":707,"height":12}},{"id":"1a4db1a2-149c-4188-bf8f-3b63df535654","block_type":"box","text":"operating, a Fund may not be able to acquire or dispose of bonds through Bond Connect in a timely","page_number":143,"box":{"x":116,"y":316,"width":745,"height":13}},{"id":"c046cf1d-090f-495a-8052-bdc74d0cacdf","block_type":"box","text":"manner, which could adversely affect the Fund’s performance.","page_number":143,"box":{"x":117,"y":332,"width":467,"height":12}},{"id":"9de3fac6-a541-483d-81ac-19b4dcba2e1e","block_type":"box","text":"Trading through Bond Connect is performed through newly developed trading platforms and","page_number":143,"box":{"x":116,"y":360,"width":687,"height":12}},{"id":"0f9dc49c-50f9-4cd9-9285-073eec30f784","block_type":"box","text":"operational systems. There is no assurance that such systems will function properly or will continue to","page_number":143,"box":{"x":116,"y":375,"width":761,"height":12}},{"id":"a3ad1ca3-b937-404d-a116-69b373f1e730","block_type":"box","text":"be adapted to changes and developments in the market. In the event that the relevant systems fail to","page_number":143,"box":{"x":117,"y":391,"width":753,"height":12}},{"id":"88ae54cf-2ed2-40e8-b035-d717fb7bbb95","block_type":"box","text":"function properly, trading through Bond Connect may be disrupted. A Fund’s ability to trade through","page_number":143,"box":{"x":116,"y":406,"width":744,"height":12}},{"id":"8803370c-fd01-4bcf-b4d1-d66417e2150c","block_type":"box","text":"Bond Connect (and hence to pursue its investment strategy) may therefore be adversely affected. In","page_number":143,"box":{"x":117,"y":422,"width":749,"height":12}},{"id":"4914ce2b-d2e7-401e-914f-ca6f37ab60ae","block_type":"box","text":"addition, where a Fund invests in the China Interbank Bond Market through Bond Connect, it may be","page_number":143,"box":{"x":116,"y":437,"width":753,"height":12}},{"id":"7b08dfa4-d95f-4b52-9381-b65396c6db05","block_type":"box","text":"subject to risks of delays inherent in the order placing and/or settlement systems.","page_number":143,"box":{"x":116,"y":453,"width":607,"height":12}},{"id":"ab35f24d-7ec2-43a5-8d20-3984a2b67d51","block_type":"box","text":"Bond Connect trades are settled in Chinese currency, the RMB, which is currently restricted and not","page_number":143,"box":{"x":117,"y":481,"width":746,"height":12}},{"id":"b2cda866-2202-4c32-9274-9c6adedfffa2","block_type":"box","text":"freely convertible. As a result, a Fund will be exposed to currency risk, and it cannot be guaranteed","page_number":143,"box":{"x":116,"y":496,"width":740,"height":12}},{"id":"46330e75-2767-42b4-ac0d-82b33d9192ff","block_type":"box","text":"that investors will have timely access to a reliable supply of RMB.","page_number":143,"box":{"x":116,"y":512,"width":490,"height":12}},{"id":"533e03b5-4e7e-4200-ad1a-7171ede9d50f","block_type":"box","text":"Tax Risk — Withholding Income Tax Risk.","page_number":143,"box":{"x":118,"y":540,"width":317,"height":12}},{"id":"45c3c746-9469-450e-8dfc-d6652f30c8c4","block_type":"box","text":"According to PRC tax regulations, a 10% withholding income tax is imposed on PRC sourced","page_number":143,"box":{"x":116,"y":561,"width":697,"height":13}},{"id":"9f8674f4-d11d-42f3-b71a-eca816ca2333","block_type":"box","text":"dividends and interests from non-government bonds paid to a non-PRC tax resident enterprise, unless","page_number":143,"box":{"x":116,"y":577,"width":765,"height":12}},{"id":"4bbdf159-487c-4c03-b69f-b3c934ff3d7c","block_type":"box","text":"the rate is reduced under an applicable tax treaty. From a technical perspective, withholding income","page_number":143,"box":{"x":116,"y":593,"width":746,"height":12}},{"id":"bd9f08a4-bcf5-4929-a34b-6d97e81935c4","block_type":"box","text":"tax is also applicable to capital gains realized by foreign investors on the disposal of PRC equity","page_number":143,"box":{"x":116,"y":608,"width":717,"height":12}},{"id":"71e7324e-5ced-436a-9c87-84de16e8fbd9","block_type":"box","text":"interests.","page_number":143,"box":{"x":117,"y":624,"width":72,"height":9}},{"id":"a7ba3281-a669-4e8a-a032-10e1002a0495","block_type":"box","text":"There are however certain tax exemptions available, some temporary in nature, highlighted below.","page_number":143,"box":{"x":116,"y":651,"width":735,"height":12}},{"id":"14712252-f238-43e9-92d3-953a1f1fe7f0","block_type":"box","text":"On November 14, 2014, the Ministry of Finance (“MoF”), China Securities Regulatory Commission and","page_number":143,"box":{"x":116,"y":679,"width":761,"height":12}},{"id":"a940969c-de92-422a-8378-07c41b1e3325","block_type":"box","text":"the State Taxation Administration (“STA”), acting with State Council’s approval, jointly released Circular","page_number":143,"box":{"x":116,"y":695,"width":767,"height":12}},{"id":"2d1687d3-b630-41d1-b499-d3257501f77d","block_type":"box","text":"79, which temporarily exempts Qualified Foreign Institutional Investors (“QFIIs”) and Renminbi","page_number":143,"box":{"x":116,"y":710,"width":699,"height":12}},{"id":"21b77952-5476-493a-a4af-e22cdb957c14","block_type":"box","text":"Qualified Foreign Institutional Investors (“RQFIIs”) from tax on capital gains derived from the trading of","page_number":143,"box":{"x":116,"y":726,"width":760,"height":12}},{"id":"f14a2014-2017-4e71-b0eb-6705349693c6","block_type":"box","text":"shares and other equity interest investments on or after November 17, 2014. Subsequently, Circulars","page_number":143,"box":{"x":116,"y":741,"width":751,"height":12}},{"id":"7730a3a2-d615-46e0-b94d-04444068bddf","block_type":"box","text":"81 and 127 were issued to temporarily exempt tax on capital gains derived from trading of equity","page_number":143,"box":{"x":116,"y":757,"width":716,"height":12}},{"id":"2bad92ce-ca3f-4c55-af77-8dd1ebf3d8c4","block_type":"box","text":"securities of companies domiciled in the PRC that trade on Chinese stock exchanges (“A-Shares”)","page_number":143,"box":{"x":116,"y":772,"width":729,"height":12}},{"id":"36351160-b504-458a-959c-c09a978d9061","block_type":"box","text":"through the Shanghai-Hong Kong Stock Connect program or the Shenzhen-Hong Kong Stock Connect","page_number":143,"box":{"x":116,"y":788,"width":764,"height":12}},{"id":"b509bf41-947c-48ed-9d6b-5d85091b8708","block_type":"box","text":"program, as applicable (each, a “Stock Connect” and collectively, “Stock Connects”). The duration of","page_number":143,"box":{"x":117,"y":803,"width":746,"height":12}},{"id":"dc29592a-534f-44aa-a872-1b4035f54196","block_type":"box","text":"the temporary exemptions is not stated in the circulars and is subject to termination by the PRC tax","page_number":143,"box":{"x":116,"y":819,"width":735,"height":12}},{"id":"4b6ac959-2af5-4587-89fa-ded8ea197c56","block_type":"box","text":"authorities with or without notice.","page_number":143,"box":{"x":116,"y":834,"width":249,"height":10}},{"id":"39584146-b506-4468-99e5-20279089c633","block_type":"box","text":"On November 22, 2018, the MoF and STA jointly issued Circular 108 which states that foreign","page_number":143,"box":{"x":116,"y":862,"width":703,"height":12}},{"id":"7aac58d5-e277-48d3-9ad2-09a2b40066c4","block_type":"box","text":"institutional investors are temporarily exempt from withholding income tax with respect to interest","page_number":143,"box":{"x":117,"y":878,"width":723,"height":12}},{"id":"f4ae310e-3707-4475-99cb-e1022b3bcd7c","block_type":"box","text":"II-59","page_number":143,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"629a86f5-ec4b-4f76-bb77-c4b2a409841c","block_type":"box","text":"NM0926U-5926888-143/257","page_number":143,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"fc798982-4b88-4825-ad32-4a49a865c08b","block_type":"box","text":"income on bonds derived from the PRC bond market from November 7, 2018 to November 6, 2021.","page_number":144,"box":{"x":117,"y":87,"width":745,"height":11}},{"id":"2f6ace2b-9743-47db-82c9-8251cf74ca0e","block_type":"box","text":"On November 22, 2021, the MoF and STA issued Public Notice 34 to extend the temporary exemption","page_number":144,"box":{"x":116,"y":102,"width":765,"height":13}},{"id":"007f9a9f-247a-4212-b9d2-f282e85084d1","block_type":"box","text":"from November 7, 2021 to December 31, 2025. On January 15, 2026, it was announced via Public","page_number":144,"box":{"x":116,"y":118,"width":736,"height":12}},{"id":"410240ce-67d8-4d00-a011-76619f1174ac","block_type":"box","text":"Notice No. 5 of 2026 that the exemption was extended through December 31, 2027.","page_number":144,"box":{"x":117,"y":134,"width":628,"height":12}},{"id":"f5fd6be8-85ab-46e2-b1f5-334495d1afd2","block_type":"box","text":"Value Added Tax (“VAT”) Risk—","page_number":144,"box":{"x":118,"y":165,"width":225,"height":12}},{"id":"4c762f48-b6c2-46f3-a7cd-0620d29f2391","block_type":"box","text":"k—From May 1, 2016, VAT applies to certain income derived by the","page_number":144,"box":{"x":342,"y":165,"width":501,"height":12}},{"id":"718e8f8b-5dfe-4f3f-a87a-b0b0ca6fe792","block_type":"box","text":"Fund, including PRC sourced interest income on non-government bonds and trading gains.","page_number":144,"box":{"x":117,"y":180,"width":681,"height":12}},{"id":"6745be0c-19a9-4a00-bd3e-d0900bb97d6e","block_type":"box","text":"There are however certain tax exemptions available, some temporary in nature, highlighted below.","page_number":144,"box":{"x":116,"y":211,"width":735,"height":12}},{"id":"b3ede363-2339-41a2-9c1d-38cb9b175a02","block_type":"box","text":"VAT exemptions currently apply to capital gains from trading of QFII and RQFII products, A-Shares","page_number":144,"box":{"x":116,"y":242,"width":741,"height":12}},{"id":"09a9a983-906c-4905-b1a3-9d6b804adeb3","block_type":"box","text":"traded on the Stock Connects and debt securities traded in the China Interbank Bond Market.","page_number":144,"box":{"x":116,"y":258,"width":699,"height":9}},{"id":"ee5eb91b-36bf-43b3-97bb-8d581b8c450f","block_type":"box","text":"On November 7, 2018, the MoF and STA jointly issued Circular 108 which states that foreign","page_number":144,"box":{"x":116,"y":289,"width":694,"height":12}},{"id":"04a472ce-2009-418f-9571-c599cf5dcaaa","block_type":"box","text":"institutional investors are temporarily exempt from VAT with respect to interest income on bonds","page_number":144,"box":{"x":117,"y":304,"width":718,"height":12}},{"id":"495055a7-1728-4e2a-90a2-7d07988ea90d","block_type":"box","text":"derived from the PRC bond market from November 7, 2018 to November 6, 2021. On November 22,","page_number":144,"box":{"x":116,"y":320,"width":750,"height":11}},{"id":"1c0199bf-1907-4cf8-afea-606ec91c1ac3","block_type":"box","text":"2021, the MoF and STA jointly issued Public Notice 34 to extend the temporary exemption from","page_number":144,"box":{"x":116,"y":335,"width":714,"height":12}},{"id":"81c7a686-5566-42f3-ac7f-39fcef2af243","block_type":"box","text":"November 7, 2021 to December 31, 2025. However, on July 31, 2025, the MoF and STA jointly issued","page_number":144,"box":{"x":117,"y":351,"width":764,"height":12}},{"id":"56c26bb4-b2fd-4e15-94b7-a24d004ca2f5","block_type":"box","text":"Public Notice No 4 of 2025, stating that VAT will apply with respect to interest income derived from","page_number":144,"box":{"x":117,"y":366,"width":735,"height":12}},{"id":"8505fa33-feb9-4459-be23-9143b8ea2fc0","block_type":"box","text":"treasury bonds, local government bonds and financial bonds issued on or after August 8, 2025. It is","page_number":144,"box":{"x":116,"y":382,"width":742,"height":12}},{"id":"c63009c4-95bd-46b5-adaa-081731864246","block_type":"box","text":"understood that Public Notice No 4 of 2025 does not supersede the afore-mentioned exemption for","page_number":144,"box":{"x":117,"y":397,"width":739,"height":12}},{"id":"0a1dc399-c8b7-4909-bc6d-58ba46bd87a4","block_type":"box","text":"foreign institutional investors. This exemption was extended through December 31, 2027.","page_number":144,"box":{"x":116,"y":413,"width":668,"height":12}},{"id":"470831c2-8096-4533-9446-32141f9cea2f","block_type":"box","text":"Any changes in PRC tax law, future clarifications thereof, and/or subsequent retroactive enforcement","page_number":144,"box":{"x":116,"y":444,"width":754,"height":12}},{"id":"f595b1bc-820c-4db5-85e6-9ba9c226b404","block_type":"box","text":"by the PRC tax authorities may result in a loss which could be material to the Fund. There is a risk the","page_number":144,"box":{"x":117,"y":459,"width":761,"height":12}},{"id":"65f3379b-127c-4f4d-a9ed-2bf0bc0290c7","block_type":"box","text":"PRC tax authorities may withdraw the temporary tax exemptions in the future and seek to collect taxes","page_number":144,"box":{"x":117,"y":475,"width":765,"height":12}},{"id":"3eab763b-57d1-42f0-9383-8a91b6a3ca67","block_type":"box","text":"realized on the sale of A-Shares or PRC sourced interest income on non-government bonds received","page_number":144,"box":{"x":117,"y":490,"width":756,"height":12}},{"id":"afa5d96d-99a9-45d3-bc36-d1a309f5e188","block_type":"box","text":"by the Fund without giving any prior notice. If the temporary tax exemptions are withdrawn, any taxes","page_number":144,"box":{"x":117,"y":506,"width":755,"height":12}},{"id":"059119f8-8d67-4df9-8a2e-19737b6dc64c","block_type":"box","text":"may be directly borne by or indirectly passed on to the Fund and may result in a substantial impact to","page_number":144,"box":{"x":117,"y":521,"width":755,"height":12}},{"id":"cbc8a933-c3a7-4452-8cd1-5ddcae0a89ab","block_type":"box","text":"its net asset value. As with any net asset value adjustment, investors may be advantaged or","page_number":144,"box":{"x":117,"y":537,"width":687,"height":12}},{"id":"4e850a5a-4643-4a57-89b8-3aeb84ed2af7","block_type":"box","text":"disadvantaged depending on when the investors purchased and/or sold the shares of the Fund. There","page_number":144,"box":{"x":116,"y":552,"width":763,"height":12}},{"id":"bbe2b1dc-9f33-4e18-bdd7-4d40126b7e38","block_type":"box","text":"will be no retrospective restatement of the Fund’s net asset value.","page_number":144,"box":{"x":116,"y":568,"width":494,"height":12}},{"id":"80be00b2-4399-4a41-b565-02fbee97063e","block_type":"box","text":"BlackRock will keep the provisioning policy for tax liability under review and may, in its discretion from","page_number":144,"box":{"x":117,"y":599,"width":758,"height":12}},{"id":"9442d6d5-f1c5-4d1d-a4f1-f86f768308ee","block_type":"box","text":"time to time, make a provision for potential tax liabilities if in its opinion such provision is warranted or","page_number":144,"box":{"x":116,"y":614,"width":756,"height":12}},{"id":"beef3404-4407-497c-a79e-2e2e48042f82","block_type":"box","text":"as further clarified by the PRC in notifications.","page_number":144,"box":{"x":116,"y":630,"width":345,"height":12}},{"id":"f8a7497f-a4c9-4017-8bc0-035147c49d20","block_type":"box","text":"Investment in Other Investment Companies.","page_number":144,"box":{"x":116,"y":661,"width":350,"height":12}},{"id":"2525a41c-65b9-48b2-b676-08fc3db850ce","block_type":"box","text":"Each Fund may, subject to applicable law, invest in","page_number":144,"box":{"x":474,"y":661,"width":378,"height":12}},{"id":"a3f847b7-459f-4332-928e-7fdd84311e67","block_type":"box","text":"other investment companies (including investment companies managed by BlackRock and its","page_number":144,"box":{"x":116,"y":676,"width":694,"height":12}},{"id":"0a925839-8e01-4e95-817c-9b405f72f606","block_type":"box","text":"affiliates), including money market funds and ETFs, which are typically open-end funds or unit","page_number":144,"box":{"x":116,"y":692,"width":697,"height":12}},{"id":"341ed3f5-02c4-45a5-baf7-582f6210eca2","block_type":"box","text":"investment trusts listed on a stock exchange. Under Section 12(d)(1)(A) of the Investment Company","page_number":144,"box":{"x":117,"y":707,"width":743,"height":12}},{"id":"b0d488b5-6f58-4ec7-b304-aad99da86866","block_type":"box","text":"Act, however, a Fund may invest up to 10% of its total assets in securities of other investment","page_number":144,"box":{"x":116,"y":723,"width":696,"height":12}},{"id":"3e02febc-809e-45d5-bbd5-2f35bd68fd00","block_type":"box","text":"companies (measured at the time of such investment). In addition, under Section 12(d)(1)(A) of the","page_number":144,"box":{"x":116,"y":738,"width":734,"height":12}},{"id":"56156d04-2a26-4009-8e66-65fdb1e23c29","block_type":"box","text":"Investment Company Act a Fund may not acquire securities of an investment company if such","page_number":144,"box":{"x":117,"y":754,"width":698,"height":12}},{"id":"42fe055f-7390-4d8a-a716-59183a7d31b7","block_type":"box","text":"acquisition would cause the Fund to own more than 3% of the total outstanding voting stock of such","page_number":144,"box":{"x":116,"y":769,"width":739,"height":12}},{"id":"22fe4e2b-ce1f-4a52-b18e-394b4799c0e4","block_type":"box","text":"investment company and a Fund may not invest in another investment company if such investment","page_number":144,"box":{"x":117,"y":785,"width":734,"height":12}},{"id":"fe0c86a9-a93f-4c36-9ae1-4fcfd0cda503","block_type":"box","text":"would cause more than 5% of the value of the Fund’s total assets to be invested in securities of such","page_number":144,"box":{"x":116,"y":800,"width":747,"height":10}},{"id":"4572431c-fd41-4ab4-8e5d-c65a578ff251","block_type":"box","text":"investment company. (These limits do not restrict a Feeder Fund from investing all of its assets in","page_number":144,"box":{"x":117,"y":816,"width":721,"height":12}},{"id":"02195d45-feea-46d7-be05-118f8d78c604","block_type":"box","text":"shares of its Master Portfolio.) In addition to the restrictions on investing in other investment companies","page_number":144,"box":{"x":116,"y":831,"width":771,"height":12}},{"id":"e2ceba84-9731-43e9-ad61-99a3c91ff7d8","block_type":"box","text":"discussed above, under Section 12(d)(1)(C) of the Investment Company Act a Fund may not invest in","page_number":144,"box":{"x":116,"y":847,"width":759,"height":12}},{"id":"d62f2d02-8094-4f23-9de2-af449b8b87f1","block_type":"box","text":"a registered closed-end investment company if such investment would cause the Fund and other","page_number":144,"box":{"x":116,"y":862,"width":724,"height":12}},{"id":"4b0c976c-7abb-49e1-aa90-b7eb6a493a04","block_type":"box","text":"BlackRock-advised investment companies to own more than 10% of the total outstanding voting stock","page_number":144,"box":{"x":117,"y":878,"width":760,"height":12}},{"id":"7de958d4-cb83-4502-9cfe-333b7eac03b7","block_type":"box","text":"II-60","page_number":144,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"22106243-38f1-45cb-91c8-631cb0ea7ff0","block_type":"box","text":"NM0926U-5926888-144/257","page_number":144,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"a82b2444-5665-4a4f-9599-a9697f7dec68","block_type":"box","text":"of such closed-end investment company. Pursuant to Section 12(d)(1)(G) of the Investment Company","page_number":145,"box":{"x":116,"y":87,"width":761,"height":12}},{"id":"d08c71c0-8719-48ef-acd4-0514d7e2bdca","block_type":"box","text":"Act, these percentage limitations do not apply to investments in affiliated investment companies,","page_number":145,"box":{"x":116,"y":102,"width":719,"height":13}},{"id":"f3482ddf-5f71-492d-90b1-8743fbd92399","block_type":"box","text":"including ETFs, subject to certain conditions. In addition, a Fund may be able to rely on certain rules","page_number":145,"box":{"x":117,"y":118,"width":747,"height":12}},{"id":"36754236-f731-425d-bd5b-bb7836038dcf","block_type":"box","text":"under the Investment Company Act to invest in shares of money market funds or other investment","page_number":145,"box":{"x":117,"y":134,"width":733,"height":12}},{"id":"2ef4b262-355c-4add-bbb1-ed9a8f4ad6c1","block_type":"box","text":"companies beyond the statutory limits noted above, but subject to certain conditions.","page_number":145,"box":{"x":116,"y":149,"width":633,"height":12}},{"id":"64cc8d49-6ab6-445c-83e8-a5a4fd0e9a99","block_type":"box","text":"As with other investments, investments in other investment companies are subject to market and","page_number":145,"box":{"x":116,"y":180,"width":723,"height":12}},{"id":"74737ffb-38f0-47c6-9fdb-f59943f0c6f6","block_type":"box","text":"selection risk.","page_number":145,"box":{"x":116,"y":196,"width":106,"height":9}},{"id":"4b8396a2-5fe2-4143-8893-95334bd50803","block_type":"box","text":"Shares of investment companies, such as closed-end fund investment companies, that trade on an","page_number":145,"box":{"x":116,"y":227,"width":740,"height":11}},{"id":"17ac898f-7536-46df-ac43-101f3374ba4b","block_type":"box","text":"exchange may at times be acquired at market prices representing premiums to their NAVs. In addition,","page_number":145,"box":{"x":116,"y":242,"width":767,"height":12}},{"id":"0300a955-b940-4e4e-b6de-172057bcb336","block_type":"box","text":"investment companies held by a Fund that trade on an exchange could trade at a discount from NAV,","page_number":145,"box":{"x":117,"y":258,"width":758,"height":12}},{"id":"3ed4e853-2906-4577-89a8-82cdde720cd1","block_type":"box","text":"and such discount could increase while the Fund holds the shares. If the market price of shares of an","page_number":145,"box":{"x":116,"y":273,"width":756,"height":12}},{"id":"c97effa5-7898-404c-86cd-b40f5d3aaeda","block_type":"box","text":"exchange-traded investment company decreases below the price that the Fund paid for the shares and","page_number":145,"box":{"x":116,"y":289,"width":771,"height":12}},{"id":"830dc1a2-c451-450c-97cb-2881622a97c5","block_type":"box","text":"the Fund were to sell its shares of such investment company at a time when the market price is lower","page_number":145,"box":{"x":116,"y":304,"width":757,"height":12}},{"id":"385a345a-0565-4685-a43e-98f96a180f57","block_type":"box","text":"than the price at which it purchased the shares, the Fund would experience a loss.","page_number":145,"box":{"x":116,"y":320,"width":617,"height":12}},{"id":"b1709fe6-6b8f-41c9-9f77-06914bac52c8","block_type":"box","text":"In addition, if a Fund acquires shares in investment companies, including affiliated investment","page_number":145,"box":{"x":117,"y":351,"width":698,"height":12}},{"id":"71fbc6ac-c044-4958-9e99-2e918a9cb7f4","block_type":"box","text":"companies, shareholders would bear both their proportionate share of expenses in the Fund and,","page_number":145,"box":{"x":116,"y":366,"width":727,"height":12}},{"id":"f93e9996-d869-4ef7-9dd4-8e771a54bad1","block_type":"box","text":"indirectly, the expenses of such investment companies. Such expenses, both at the Fund level and","page_number":145,"box":{"x":117,"y":382,"width":739,"height":12}},{"id":"e8cccfaf-1b39-4407-a320-ec0eb0a79cd5","block_type":"box","text":"acquired investment company level, would include management and advisory fees, unless such fees","page_number":145,"box":{"x":116,"y":397,"width":753,"height":12}},{"id":"062e3ff4-712d-4350-b738-b2b712c53157","block_type":"box","text":"have been waived by BlackRock. Please see the relevant Fund’s Prospectus to determine whether any","page_number":145,"box":{"x":117,"y":413,"width":769,"height":12}},{"id":"dc3f0a92-9972-4310-942c-732d90caeaec","block_type":"box","text":"such management and advisory fees have been waived by BlackRock. Investments by a Fund in","page_number":145,"box":{"x":116,"y":428,"width":724,"height":12}},{"id":"76ab6df5-e91a-4ba6-8a42-b3f34ae94bc7","block_type":"box","text":"wholly owned investment entities created under the laws of certain countries will not be deemed an","page_number":145,"box":{"x":116,"y":444,"width":740,"height":12}},{"id":"271322a5-f656-4627-9167-8a21e49fcc53","block_type":"box","text":"investment in other investment companies. Pursuant to guidance issued by the staff of the","page_number":145,"box":{"x":117,"y":459,"width":674,"height":12}},{"id":"8d89f6f0-d36a-47bf-878e-642b0bdb2da4","block_type":"box","text":"Commission, fees and expenses of money market funds used for the investment of cash collateral","page_number":145,"box":{"x":117,"y":475,"width":733,"height":12}},{"id":"c33cb777-61e1-4188-b7cd-615958e9d219","block_type":"box","text":"received in connection with loans of Fund securities are not treated as “acquired fund fees and","page_number":145,"box":{"x":117,"y":490,"width":706,"height":12}},{"id":"bb7933f2-9ce1-4e22-b568-6d2436233b14","block_type":"box","text":"expenses,” which are fees and expenses charged by other investment companies and pooled","page_number":145,"box":{"x":116,"y":506,"width":701,"height":12}},{"id":"e5e6333f-479a-4b09-9a59-10f04d2ba64c","block_type":"box","text":"investment vehicles in which a Fund invests a portion of its assets.","page_number":145,"box":{"x":117,"y":521,"width":498,"height":12}},{"id":"91ad7854-18eb-4d49-bad0-5865a85e5c22","block_type":"box","text":"To the extent shares of a Fund are held by another f","page_number":145,"box":{"x":116,"y":552,"width":380,"height":12}},{"id":"90a29d8a-26fe-4d95-bd72-0ee205df74f5","block_type":"box","text":"und, the ability of the Fund it","page_number":145,"box":{"x":497,"y":552,"width":205,"height":12}},{"id":"2eea00fc-fb9b-49a4-8b2d-794764ca8900","block_type":"box","text":"self to purchase other","page_number":145,"box":{"x":702,"y":552,"width":163,"height":12}},{"id":"f916d485-b761-4832-813c-a7acd79377b2","block_type":"box","text":"funds may be limited. In addition, a fund of funds (","page_number":145,"box":{"x":116,"y":568,"width":363,"height":12}},{"id":"22b329bb-d760-44b8-8eab-fa4ad4050d12","block_type":"box","text":"e.g.","page_number":145,"box":{"x":480,"y":570,"width":25,"height":10}},{"id":"efd31eef-6e48-4b5d-968c-de6320f86f6c","block_type":"box","text":", an investment company that seeks to meet its","page_number":145,"box":{"x":508,"y":568,"width":347,"height":12}},{"id":"78e8411d-a925-4a78-b0cf-a6657b302152","block_type":"box","text":"investment objective by investing significantly in","page_number":145,"box":{"x":117,"y":583,"width":350,"height":12}},{"id":"f810a83b-06ca-4377-8fed-fdb28d40f817","block_type":"box","text":"other investment companies)","page_number":145,"box":{"x":468,"y":583,"width":215,"height":12}},{"id":"13dd9afc-7850-468d-9c55-e3053036e562","block_type":"box","text":"may be limited in its ability","page_number":145,"box":{"x":684,"y":583,"width":195,"height":12}},{"id":"fea64082-e0d5-427e-8c75-6027fea80ab7","block_type":"box","text":"to purchase underlying funds if such underlying f","page_number":145,"box":{"x":116,"y":599,"width":353,"height":12}},{"id":"527dd24a-b7e4-4341-9596-ff52ed1dd796","block_type":"box","text":"unds themselves own shares of underlying funds.","page_number":145,"box":{"x":470,"y":599,"width":364,"height":12}},{"id":"bad949df-dc1c-4e4c-a22e-dcde86e61709","block_type":"box","text":"A number of publicly traded closed-end investment companies have been organized to facilitate","page_number":145,"box":{"x":116,"y":630,"width":715,"height":12}},{"id":"067445fe-8173-478f-9c4a-9c191b6d2316","block_type":"box","text":"indirect foreign investment in developing countries, and certain of such countries, such as Thailand,","page_number":145,"box":{"x":117,"y":645,"width":743,"height":12}},{"id":"b63cdca0-4630-4aa6-888d-eb1768217d0c","block_type":"box","text":"South Korea, Chile and Brazil, have specifically authorized such funds. There also are investment","page_number":145,"box":{"x":116,"y":661,"width":725,"height":12}},{"id":"0cdee867-175a-4555-ba18-4efaa3079fdf","block_type":"box","text":"opportunities in certain of such countries in pooled vehicles that resemble open-end investment","page_number":145,"box":{"x":116,"y":676,"width":708,"height":12}},{"id":"44e74780-4536-4f2a-8cc5-422a67e5881d","block_type":"box","text":"companies. The restrictions on investments in securities of investment companies set forth above may","page_number":145,"box":{"x":116,"y":692,"width":760,"height":12}},{"id":"e10f9a64-9c7d-490f-81f2-239036bb5148","block_type":"box","text":"limit opportunities for a Fund to invest indirectly in certain developing countries.","page_number":145,"box":{"x":117,"y":707,"width":585,"height":12}},{"id":"c2cf1c68-f9fe-461c-bc87-e1c4dc4dbc5a","block_type":"box","text":"Issuer Insolvency Risk.","page_number":145,"box":{"x":116,"y":738,"width":185,"height":12}},{"id":"8b716a70-07e9-47a2-ae02-e8c21b8ffcc9","block_type":"box","text":"Certain Funds’ potential exposure to financially or operationally troubled","page_number":145,"box":{"x":307,"y":738,"width":532,"height":12}},{"id":"ed6db7a8-2894-45c1-97da-483141d3a947","block_type":"box","text":"issuers involves a high degree of credit and market risk, which may be heightened during an economic","page_number":145,"box":{"x":117,"y":754,"width":761,"height":12}},{"id":"a9250397-4b94-4e7f-8e4b-cc6d11112015","block_type":"box","text":"downturn or recession. Should an issuer of securities held by a Fund become involved in a bankruptcy","page_number":145,"box":{"x":116,"y":769,"width":760,"height":12}},{"id":"32aa2ee0-221d-4f1b-81e3-97fb4b9f42de","block_type":"box","text":"proceeding, reorganization or financial restructuring, a wide variety of considerations make an","page_number":145,"box":{"x":117,"y":785,"width":695,"height":12}},{"id":"533265c9-f59e-40da-95ca-7e1e01e21fb8","block_type":"box","text":"evaluation of the outcome of the Fund’s exposure to the issuer uncertain.","page_number":145,"box":{"x":116,"y":800,"width":542,"height":12}},{"id":"ec35e58a-5a46-4247-b8b7-187b7b82cc17","block_type":"box","text":"During the period of a bankruptcy proceeding, reorganization or financial restructuring, it is unlikely that","page_number":145,"box":{"x":117,"y":831,"width":769,"height":12}},{"id":"8fc586bb-fcbe-4904-9f16-730a56c4f1b6","block_type":"box","text":"a Fund will receive any interest payments on the securities of the issuer. A Fund will be subject to","page_number":145,"box":{"x":116,"y":847,"width":728,"height":12}},{"id":"3a9aefcb-f017-4c23-a1b3-a1d9b254f4c1","block_type":"box","text":"significant uncertainty as to whether the reorganization or restructuring will be completed, and the Fund","page_number":145,"box":{"x":116,"y":862,"width":772,"height":12}},{"id":"7eac1686-c8ce-41b4-82cb-58e67c24cc07","block_type":"box","text":"may bear certain extraordinary expenses to protect and recover its investment. A Fund will also be","page_number":145,"box":{"x":117,"y":878,"width":735,"height":12}},{"id":"96b6d589-9c51-418a-befa-47a22685fac1","block_type":"box","text":"II-61","page_number":145,"box":{"x":484,"y":909,"width":29,"height":9}},{"id":"b5fc0850-9ae3-44d4-a7b1-704a84be2947","block_type":"box","text":"NM0926U-5926888-145/257","page_number":145,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"164766f1-e41c-4d64-aa7c-65669400c5fc","block_type":"box","text":"subject to significant uncertainty as to when and in what manner and for what value the obligations","page_number":146,"box":{"x":116,"y":87,"width":737,"height":12}},{"id":"e0c6e6c4-6fb6-4893-a359-8b6dbfcb9f72","block_type":"box","text":"evidenced by the securities of the issuer held by the Fund will eventually be satisfied.","page_number":146,"box":{"x":116,"y":102,"width":637,"height":13}},{"id":"39f7db36-ed3d-4bf3-acb7-045ba93149b7","block_type":"box","text":"Even if a plan of reorganization or restructuring is adopted with respect to the securities of the issuer","page_number":146,"box":{"x":117,"y":134,"width":741,"height":12}},{"id":"2712a06b-85ae-4c82-85ba-00042b8307eb","block_type":"box","text":"held by the Fund, there can be no assurance that the securities or other assets received by a Fund in","page_number":146,"box":{"x":117,"y":149,"width":748,"height":12}},{"id":"4f4dcaf3-8828-49ae-9c15-c95a6d1c9a70","block_type":"box","text":"connection with such plan of reorganization or restructuring will not have a lower value or income","page_number":146,"box":{"x":116,"y":165,"width":717,"height":12}},{"id":"6fd1670d-aa32-4038-95e0-b95b47374fbe","block_type":"box","text":"potential than may have been anticipated or no value. A Fund may be unable to enforce its claims or","page_number":146,"box":{"x":117,"y":180,"width":742,"height":12}},{"id":"034f5b2f-4165-449a-9c79-61a9e43b9941","block_type":"box","text":"rights in any collateral or may have its claims or security interest in any collateral challenged, disallowed","page_number":146,"box":{"x":117,"y":196,"width":767,"height":12}},{"id":"1fd1727c-5e9b-4200-bb4e-fdf33abb2f91","block_type":"box","text":"or subordinated to the claims or security interests of other creditors. In addition, amendments to the U.S.","page_number":146,"box":{"x":116,"y":211,"width":772,"height":12}},{"id":"e98eb4b7-0c9e-499a-9232-510013e72521","block_type":"box","text":"Bankruptcy Code or other relevant laws could alter the expected outcome or introduce greater","page_number":146,"box":{"x":117,"y":227,"width":695,"height":12}},{"id":"17763c4f-c813-442c-a0ea-1c7398b39b28","block_type":"box","text":"uncertainty regarding the outcome of the Fund’s securities holdings in the issuer. In a bankruptcy","page_number":146,"box":{"x":117,"y":242,"width":716,"height":12}},{"id":"8748c2bb-3481-435c-9c2e-8228081a5094","block_type":"box","text":"proceeding, a reorganization or restructuring, the securities of the issuer held by a Fund could be","page_number":146,"box":{"x":117,"y":258,"width":716,"height":12}},{"id":"a71f361b-b7f3-4a67-8c8d-4e766c731d0e","block_type":"box","text":"re-characterized or a Fund may receive different securities or other assets, including equity securities.","page_number":146,"box":{"x":117,"y":273,"width":752,"height":12}},{"id":"b8e78bba-1ab3-4c25-b399-90c9d602da90","block_type":"box","text":"These types of equity securities include, but are not limited to: common stock; preferred stock (including","page_number":146,"box":{"x":116,"y":289,"width":768,"height":12}},{"id":"785b8c63-e8bf-4817-87f3-64e54eb55b68","block_type":"box","text":"convertible preferred stock); bonds, notes and debentures convertible into common or preferred stock;","page_number":146,"box":{"x":116,"y":304,"width":756,"height":12}},{"id":"972c1ce3-29f7-44a8-b577-8ac442402210","block_type":"box","text":"stock purchase warrants and rights; equity interests in trusts; and depositary receipts. Equity securities","page_number":146,"box":{"x":116,"y":320,"width":759,"height":12}},{"id":"186494a8-19c4-49e5-b379-84a8c9a30653","block_type":"box","text":"are subject to changes in value, and their value may be more volatile than those of other asset classes.","page_number":146,"box":{"x":116,"y":335,"width":764,"height":12}},{"id":"04588b37-ed86-4ea5-9983-60f3dd040cf5","block_type":"box","text":"Holders of equity securities are subject to more risk than holders of debt securities because the status of","page_number":146,"box":{"x":117,"y":351,"width":771,"height":12}},{"id":"ba78a5c3-6e4a-492a-ac56-642fbd8c9947","block_type":"box","text":"equity holders is subordinate to debtholders in an issuer’s capital structure. The value of equity","page_number":146,"box":{"x":116,"y":366,"width":701,"height":12}},{"id":"32338180-1a0c-4d8c-94a3-11becc3b65d2","block_type":"box","text":"securities received by a Fund could decline if the financial condition of the issuer deteriorates or if","page_number":146,"box":{"x":116,"y":382,"width":721,"height":12}},{"id":"ded23bfc-b32f-440c-b3e7-0fdc9b5d112a","block_type":"box","text":"overall market and economic conditions, or conditions within the issuer’s region or industry, deteriorate.","page_number":146,"box":{"x":116,"y":397,"width":764,"height":12}},{"id":"0d8d3d9d-0801-4b45-bd11-a1e92c5242fb","block_type":"box","text":"To the extent that a Fund receives other assets in connection with a bankruptcy proceeding,","page_number":146,"box":{"x":116,"y":428,"width":681,"height":12}},{"id":"a28c1cf4-cc89-4267-8ef5-24fb44d217b8","block_type":"box","text":"reorganization or financial restructuring, the Fund may also be subject to additional risks associated with","page_number":146,"box":{"x":117,"y":444,"width":770,"height":12}},{"id":"a231d1a2-da6e-401f-9f34-c3f68d5a5a2d","block_type":"box","text":"the assets received. One example of assets that a Fund could receive is an interest in one or more","page_number":146,"box":{"x":116,"y":459,"width":730,"height":12}},{"id":"7886809e-bf58-4ed1-863f-9ffc67cd9d41","block_type":"box","text":"loans made to the issuer as part of a workout agreed to by a consortium of lienholders and creditors of","page_number":146,"box":{"x":117,"y":475,"width":756,"height":12}},{"id":"3ac36c06-98c7-4a00-b3e6-43a1f6f50019","block_type":"box","text":"the issuer. A Fund may receive such interests in loans to the extent permitted by the Investment","page_number":146,"box":{"x":116,"y":490,"width":710,"height":12}},{"id":"095e180a-5fb9-40a5-8074-915d2b1c7bfc","block_type":"box","text":"Company Act.","page_number":146,"box":{"x":117,"y":506,"width":108,"height":12}},{"id":"90864aa6-7ebb-403b-bd0f-6df925c0ea9f","block_type":"box","text":"Securities or other assets received in a reorganization or restructuring typically entail a higher degree","page_number":146,"box":{"x":116,"y":537,"width":756,"height":12}},{"id":"16c620f4-1a84-48f6-be03-e96b7fddc128","block_type":"box","text":"of risk than investments in securities of issuers that have not undergone a reorganization or","page_number":146,"box":{"x":116,"y":552,"width":684,"height":12}},{"id":"df85ab17-5b3f-4d30-9750-3781e6f11846","block_type":"box","text":"restructuring and may be subject to heavy selling or downward pricing pressure after completion of the","page_number":146,"box":{"x":117,"y":568,"width":765,"height":12}},{"id":"f0d1850e-e205-43f3-99a7-32c68ae52c68","block_type":"box","text":"reorganization or restructuring. The post-reorganization/restructuring assets and securities may also be","page_number":146,"box":{"x":117,"y":583,"width":771,"height":12}},{"id":"77478534-aa43-4eff-b9f5-ccafdb33b9e0","block_type":"box","text":"illiquid and difficult to sell or value. If a Fund participates in negotiations with respect to a plan of","page_number":146,"box":{"x":117,"y":599,"width":715,"height":12}},{"id":"2d3b189f-f9b0-4a03-8775-f63bedd6db7e","block_type":"box","text":"reorganization or restructuring with respect to securities of the issuer held by a Fund, the Fund also","page_number":146,"box":{"x":117,"y":614,"width":741,"height":12}},{"id":"eeed45f4-ffe0-4af2-8990-78e0b0ccf957","block_type":"box","text":"may be restricted from disposing such securities for a period of time. If a Fund becomes involved in","page_number":146,"box":{"x":117,"y":630,"width":741,"height":12}},{"id":"b8ff11e2-bdad-4a26-99fb-7da63dcfb998","block_type":"box","text":"such proceedings, the Fund may have more active participation in the affairs of the issuer than that","page_number":146,"box":{"x":116,"y":645,"width":740,"height":12}},{"id":"bbaf13e5-b91b-4609-b734-d3f37f7047f2","block_type":"box","text":"assumed generally by an investor.","page_number":146,"box":{"x":116,"y":661,"width":254,"height":12}},{"id":"46cbb400-00b0-42dd-9950-693f35de826f","block_type":"box","text":"Lease Obligations.","page_number":146,"box":{"x":116,"y":692,"width":148,"height":12}},{"id":"9d9ea3bc-9e8c-4eec-8acd-a8c78a143bc1","block_type":"box","text":"A Fund may hold participation certificates in a lease, an installment purchase","page_number":146,"box":{"x":270,"y":692,"width":571,"height":12}},{"id":"c61fd9d6-f0d9-45ee-b51f-4c17bbdd0aba","block_type":"box","text":"contract, or a conditional sales contract (“lease obligations”). The Manager will monitor the credit","page_number":146,"box":{"x":116,"y":707,"width":716,"height":12}},{"id":"3fb7815f-3202-4592-a6f7-9e679de91442","block_type":"box","text":"standing of each borrower and each entity providing credit support and/or a put option relating to lease","page_number":146,"box":{"x":116,"y":723,"width":761,"height":12}},{"id":"d65aeb47-b4db-488f-8b6b-5394fa8f345c","block_type":"box","text":"obligations.","page_number":146,"box":{"x":116,"y":738,"width":83,"height":12}},{"id":"6cc276eb-9db7-465f-838e-3b9640becf39","block_type":"box","text":"Life Settlement Investments.","page_number":146,"box":{"x":116,"y":769,"width":227,"height":10}},{"id":"8db5573e-b0d8-42a2-a5c9-de37032b3235","block_type":"box","text":"A Fund may invest in life settlements, which are sales to third parties,","page_number":146,"box":{"x":349,"y":769,"width":514,"height":12}},{"id":"6e4f56a4-8b85-4b00-9094-5ad1c9819ff8","block_type":"box","text":"such as the Fund, of existing life insurance contracts for more than their cash surrender value but less","page_number":146,"box":{"x":116,"y":785,"width":757,"height":12}},{"id":"c924ecf1-4343-4dd4-93e0-4b8254652021","block_type":"box","text":"than the net benefits to be paid under the policies. When a Fund acquires such a contract, it pays the","page_number":146,"box":{"x":116,"y":800,"width":751,"height":12}},{"id":"ade540bf-4405-436f-b37e-4af9d5381165","block_type":"box","text":"policy premiums in return for the expected receipt of the net benefit as the beneficiary under the policy.","page_number":146,"box":{"x":117,"y":816,"width":761,"height":12}},{"id":"5bf7db89-228a-4723-be0d-1bbdf50c0716","block_type":"box","text":"Investments in these contracts involve certain risks, including liquidity risk, credit risk of the insurance","page_number":146,"box":{"x":117,"y":831,"width":756,"height":12}},{"id":"8340975e-47be-4787-b2dd-2dd99c62bbee","block_type":"box","text":"company, and inaccurate estimations of life expectancy of the insured individuals (viators). These","page_number":146,"box":{"x":116,"y":847,"width":729,"height":12}},{"id":"109f2618-9197-41ff-9d8f-eda9d376d858","block_type":"box","text":"policies may be considered illiquid because they are bought and sold in a secondary market through","page_number":146,"box":{"x":117,"y":862,"width":748,"height":12}},{"id":"64bf8874-026c-4875-b199-4283bd07328d","block_type":"box","text":"life settlement agents. Also, in the event of a bankruptcy of the insurance carrier for a policy, the Fund","page_number":146,"box":{"x":117,"y":878,"width":760,"height":12}},{"id":"0ffb17db-a9ce-4eaf-9956-faf83ea85057","block_type":"box","text":"II-62","page_number":146,"box":{"x":484,"y":909,"width":31,"height":9}},{"id":"4820bc82-b5e2-402a-9916-8787462b11fa","block_type":"box","text":"NM0926U-5926888-146/257","page_number":146,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"3b426834-ff44-4021-b72a-669cfe40df5a","block_type":"box","text":"may receive reduced or no benefits under the contract. A Fund seeks to minimize credit risk by","page_number":147,"box":{"x":117,"y":87,"width":708,"height":12}},{"id":"f5c4f381-fac0-4b47-b215-296640c04d97","block_type":"box","text":"investing in policies issued by a diverse range of highly-rated insurance carriers. Furthermore, a Fund","page_number":147,"box":{"x":117,"y":102,"width":758,"height":13}},{"id":"f362cc1c-c6b2-4d8d-8c78-314728d1fc06","block_type":"box","text":"may encounter losses on its investments if there is an inaccurate estimation of the life expectancies of","page_number":147,"box":{"x":117,"y":118,"width":761,"height":12}},{"id":"4cc68f68-bb92-4cff-aa3d-e5d42892452d","block_type":"box","text":"viators. A Fund intends to reduce this life expectancy risk by investing only in contracts where the life","page_number":147,"box":{"x":116,"y":134,"width":754,"height":12}},{"id":"ae5276e9-82bb-49b7-a537-64aa6328ddd4","block_type":"box","text":"expectancy was reviewed by an experienced actuary, as well as by diversifying its investments across","page_number":147,"box":{"x":116,"y":149,"width":763,"height":12}},{"id":"d2b2f6bc-d02f-4818-b7d3-15b59d47743a","block_type":"box","text":"viators of varying ages and medical profiles. In addition, it is unclear whether the income from life","page_number":147,"box":{"x":116,"y":165,"width":725,"height":12}},{"id":"e2e759fb-9d2e-4c3e-8e2a-ac0257d3a759","block_type":"box","text":"settlements is qualifying income for purposes of the IRS 90% gross income test a Fund must satisfy","page_number":147,"box":{"x":116,"y":180,"width":746,"height":12}},{"id":"8896cf5d-a778-4d56-8c58-dd2bd0b1fb6a","block_type":"box","text":"each year to qualify as a regulated investment company. A Fund intends to monitor its investments to","page_number":147,"box":{"x":116,"y":196,"width":758,"height":12}},{"id":"d308ed65-4964-444a-8062-a4f59ceacd57","block_type":"box","text":"ensure that the Fund remains qualified as a regulated investment company.","page_number":147,"box":{"x":116,"y":211,"width":567,"height":12}},{"id":"4234e328-fd63-478a-9b9f-069e3223f53f","block_type":"box","text":"Liquidity Risk Management.","page_number":147,"box":{"x":116,"y":242,"width":221,"height":12}},{"id":"b01f51c4-96ee-4b50-bbbf-0c37c418e03b","block_type":"box","text":"Rule 22e-4 under the Investment Company Act (the “Liquidity Rule”)","page_number":147,"box":{"x":338,"y":242,"width":517,"height":12}},{"id":"e79bc06b-60e7-496e-b5e6-47a5bdd25619","block_type":"box","text":"requires open-end funds, such as the Funds, to adopt a liquidity risk management program and","page_number":147,"box":{"x":117,"y":258,"width":712,"height":12}},{"id":"463b6e57-9589-4cdc-8197-308efbd3be36","block_type":"box","text":"enhance disclosures regarding fund liquidity. As required by the Liquidity Rule, the Funds have","page_number":147,"box":{"x":116,"y":273,"width":709,"height":12}},{"id":"9718c752-47a7-4148-a388-6b4dd1bddc5d","block_type":"box","text":"implemented a liquidity risk management program (the “Liquidity Program”), and the Boards of","page_number":147,"box":{"x":117,"y":289,"width":704,"height":12}},{"id":"0762e056-5fd6-419f-8f18-399259e02243","block_type":"box","text":"Directors of the Funds, including a majority of the independent Directors, have appointed the Manager","page_number":147,"box":{"x":117,"y":304,"width":762,"height":12}},{"id":"8a3e4974-1c28-414c-8166-68db0fbe7f62","block_type":"box","text":"as the liquidity risk program administrator of the Liquidity Program. Under the Liquidity Program, the","page_number":147,"box":{"x":116,"y":320,"width":745,"height":12}},{"id":"7135dd55-8a78-4e0f-8321-6282e0ee5545","block_type":"box","text":"Manager assesses, manages, and periodically reviews each Fund’s liquidity risk and classifies each","page_number":147,"box":{"x":117,"y":335,"width":746,"height":12}},{"id":"1dfb3b4f-1930-43f0-a4ab-6df100be8160","block_type":"box","text":"investment held by a Fund as a “highly liquid investment,” “moderately liquid investment,” “less liquid","page_number":147,"box":{"x":117,"y":351,"width":750,"height":12}},{"id":"a9cfd28e-1c38-4c81-93db-b73f96b10357","block_type":"box","text":"investment” or “illiquid investment.” The Liquidity Rule defines “liquidity risk” as the risk that a Fund","page_number":147,"box":{"x":117,"y":366,"width":736,"height":12}},{"id":"5d0af63b-4354-48c6-b20e-51785b780e5d","block_type":"box","text":"could not meet requests to redeem shares issued by the Fund without significant dilution of the","page_number":147,"box":{"x":116,"y":382,"width":709,"height":12}},{"id":"9e014db6-a1ea-4384-bf97-06b56ef8fd3b","block_type":"box","text":"remaining investors’ interests in the Fund. The liquidity of a Fund’s portfolio investments is determined","page_number":147,"box":{"x":117,"y":397,"width":762,"height":12}},{"id":"0ca97646-80e6-4e18-9ebc-613caabb7ef4","block_type":"box","text":"based on relevant market, trading and investment-specific considerations under the Liquidity Program.","page_number":147,"box":{"x":117,"y":413,"width":764,"height":12}},{"id":"949c275d-c08f-4a8a-85c4-79141b7c2942","block_type":"box","text":"To the extent that an investment is deemed to be an illiquid investment or a less liquid investment, a","page_number":147,"box":{"x":116,"y":428,"width":747,"height":12}},{"id":"58ad921e-b55a-468c-9e0b-77f8e9909062","block_type":"box","text":"Fund can expect to be exposed to greater liquidity risk.","page_number":147,"box":{"x":117,"y":444,"width":411,"height":12}},{"id":"4e0482f0-8747-4da2-bbd3-4c6fa9f51dbd","block_type":"box","text":"Master Limited Partnerships.","page_number":147,"box":{"x":116,"y":475,"width":230,"height":12}},{"id":"90e95c9e-7aad-4dac-b90f-ab4ffc276eb0","block_type":"box","text":"Certain Funds may invest in publicly traded master limited partnerships","page_number":147,"box":{"x":347,"y":475,"width":538,"height":12}},{"id":"34322002-e31f-44e0-9ef1-3b42f89dfc32","block_type":"box","text":"(“MLPs”) which are limited partnerships or limited liability companies taxable as partnerships. MLPs","page_number":147,"box":{"x":117,"y":490,"width":741,"height":12}},{"id":"b2b2c5d1-4ce7-4a40-96f2-c705c5c2f498","block_type":"box","text":"may derive income and gains from the exploration, development, mining or production, processing,","page_number":147,"box":{"x":117,"y":506,"width":739,"height":12}},{"id":"e2a3acd9-e5a9-4873-b6bd-92f20fc91769","block_type":"box","text":"refining, transportation (including pipelines transporting gas, oil, or products thereof), or the marketing","page_number":147,"box":{"x":117,"y":521,"width":758,"height":12}},{"id":"91ceb42b-b40d-40de-892b-4da85847355f","block_type":"box","text":"of any mineral or natural resources. MLPs generally have two classes of owners, the general partner","page_number":147,"box":{"x":116,"y":537,"width":752,"height":12}},{"id":"2a59032d-739e-4140-b3e5-9061fac54f97","block_type":"box","text":"and limited partners. When investing in an MLP, a Fund intends to purchase publicly traded common","page_number":147,"box":{"x":116,"y":552,"width":753,"height":12}},{"id":"ab1793ba-df8b-4a52-ab8d-f53463629bdc","block_type":"box","text":"units issued to limited partners of the MLP. The general partner is typically owned by a major energy","page_number":147,"box":{"x":117,"y":568,"width":749,"height":12}},{"id":"b856e17e-3b49-439e-b6ad-85fb923beb56","block_type":"box","text":"company, an investment fund, the direct management of the MLP or is an entity owned by one or more","page_number":147,"box":{"x":116,"y":583,"width":769,"height":12}},{"id":"5816ac5d-f4be-43ca-9e99-4961e697e77f","block_type":"box","text":"of such parties. The general partner may be structured as a private or publicly traded corporation or","page_number":147,"box":{"x":116,"y":599,"width":744,"height":12}},{"id":"187ea3f2-ce47-441d-95ff-453dfd6ca5e5","block_type":"box","text":"other entity. The general partner typically controls the operations and management of the MLP through","page_number":147,"box":{"x":116,"y":614,"width":768,"height":12}},{"id":"8ed1c86c-b59c-42e1-ac20-dff704015a1c","block_type":"box","text":"an up to 2% equity interest in the MLP plus, in many cases, ownership of common units and","page_number":147,"box":{"x":116,"y":630,"width":689,"height":12}},{"id":"13896666-b1cb-42d9-8bbe-c97e763df31c","block_type":"box","text":"subordinated units. Limited partners own the remainder of the partnership, through ownership of","page_number":147,"box":{"x":116,"y":645,"width":718,"height":12}},{"id":"83283c3e-af8f-4cab-9a41-f6bd5e7b6bc6","block_type":"box","text":"common units, and have a limited role in the partnership’s operations and management.","page_number":147,"box":{"x":116,"y":661,"width":652,"height":12}},{"id":"03c72c75-950b-40cc-a0e3-066ba457413d","block_type":"box","text":"MLPs are typically structured such that common units and general partner interests have first priority to","page_number":147,"box":{"x":117,"y":692,"width":764,"height":12}},{"id":"f11ada4d-eb28-41ef-9d5d-f8109a4bec6c","block_type":"box","text":"receive quarterly cash distributions up to an established minimum amount (“minimum quarterly","page_number":147,"box":{"x":117,"y":707,"width":701,"height":12}},{"id":"ea42b702-b28e-4012-911c-885772c449c2","block_type":"box","text":"distributions” or “MQD”). Common and general partner interests also accrue arrearages in distributions","page_number":147,"box":{"x":116,"y":723,"width":762,"height":12}},{"id":"3a2f66ae-84d5-4466-9d95-a6873f97139b","block_type":"box","text":"to the extent the MQD is not paid. Once common and general partner interests have been paid,","page_number":147,"box":{"x":116,"y":738,"width":708,"height":12}},{"id":"455fe619-d4a1-4a82-bf47-86599f3d4078","block_type":"box","text":"subordinated units receive distributions of up to the MQD; however, subordinated units do not accrue","page_number":147,"box":{"x":116,"y":754,"width":750,"height":12}},{"id":"cc870817-0151-444f-992b-c5e32ad4c18c","block_type":"box","text":"arrearages. Distributable cash in excess of the MQD paid to both common and subordinated units is","page_number":147,"box":{"x":116,"y":769,"width":743,"height":12}},{"id":"c90f5c1f-ca98-46e0-8076-e6dfe0552620","block_type":"box","text":"distributed to both common and subordinated units generally on a pro rata basis. The general partner","page_number":147,"box":{"x":116,"y":785,"width":752,"height":12}},{"id":"b45d216c-44a8-4d63-b37e-bb7817141320","block_type":"box","text":"is also eligible to receive incentive distributions if the general partner operates the business in a","page_number":147,"box":{"x":117,"y":800,"width":707,"height":12}},{"id":"c52231c9-22b1-4e95-85c9-bb85ff6aaf50","block_type":"box","text":"manner which results in distributions paid per common unit surpassing specified target levels. As the","page_number":147,"box":{"x":117,"y":816,"width":746,"height":12}},{"id":"d61dca3b-0cba-4e9e-bb0d-0579e38f0cd8","block_type":"box","text":"general partner increases cash distributions to the limited partners, the general partner receives an","page_number":147,"box":{"x":116,"y":831,"width":739,"height":12}},{"id":"8c546d02-4ecf-423b-a252-d2cc2977f791","block_type":"box","text":"increasingly higher percentage of the incremental cash distributions. A common arrangement provides","page_number":147,"box":{"x":117,"y":847,"width":764,"height":12}},{"id":"0038b75a-4c9e-47f5-96b3-8e12a06580ee","block_type":"box","text":"that the general partner can reach a tier where it receives 50% of every incremental dollar paid to","page_number":147,"box":{"x":116,"y":862,"width":727,"height":12}},{"id":"5e08739d-15e9-4ca0-9af0-045fd03777d8","block_type":"box","text":"common and subordinated unit holders. These incentive distributions encourage the general partner to","page_number":147,"box":{"x":116,"y":878,"width":767,"height":12}},{"id":"89305d66-f9f8-4e9a-877b-6523298d8df8","block_type":"box","text":"II-63","page_number":147,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"3a762c11-23e3-491a-a1de-40e99272ac09","block_type":"box","text":"NM0926U-5926888-147/257","page_number":147,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"6e66b459-8c30-40f5-9610-27b686c7aae3","block_type":"box","text":"streamline costs, increase capital expenditures and acquire assets in order to increase the","page_number":148,"box":{"x":116,"y":87,"width":676,"height":12}},{"id":"dd48636f-421c-425f-833f-99a316a69aff","block_type":"box","text":"partnership’s cash flow and raise the quarterly cash distribution in order to reach higher tiers. Such","page_number":148,"box":{"x":117,"y":102,"width":736,"height":13}},{"id":"7a3b4d60-c065-4a07-97ea-0e3017416727","block_type":"box","text":"results benefit all security holders of the MLP.","page_number":148,"box":{"x":117,"y":118,"width":343,"height":12}},{"id":"5e2eabe4-aa6a-4c4e-886d-3b604fc5fa00","block_type":"box","text":"MLP common units represent a limited partnership interest in the MLP. Common units are listed and","page_number":148,"box":{"x":117,"y":148,"width":748,"height":12}},{"id":"0132ac29-2ed0-4b68-97e6-368e932f7365","block_type":"box","text":"traded on U.S. securities exchanges, with their value fluctuating predominantly based on prevailing","page_number":148,"box":{"x":116,"y":163,"width":739,"height":13}},{"id":"15e1ce8d-7074-4319-9548-930b94c0f906","block_type":"box","text":"market conditions and the success of the MLP. Certain Funds intend to purchase common units in","page_number":148,"box":{"x":117,"y":179,"width":733,"height":12}},{"id":"38cee2fd-55ea-4b20-a719-1d8c7557430f","block_type":"box","text":"market transactions. Unlike owners of common stock of a corporation, owners of common units have","page_number":148,"box":{"x":117,"y":194,"width":752,"height":12}},{"id":"c5ec0587-44c3-4296-bfa9-fabac3a98749","block_type":"box","text":"limited voting rights and have no ability to annually elect directors. In the event of liquidation, common","page_number":148,"box":{"x":117,"y":210,"width":758,"height":12}},{"id":"ef1fff3d-d4aa-4c97-b194-a56d6cdb4e06","block_type":"box","text":"units have preference over subordinated units, but not over debt or preferred units, to the remaining","page_number":148,"box":{"x":117,"y":225,"width":744,"height":13}},{"id":"2cc7b2d7-75f0-41e5-a26a-24fa45697757","block_type":"box","text":"assets of the MLP.","page_number":148,"box":{"x":116,"y":241,"width":144,"height":9}},{"id":"06b5f7f6-fce1-443e-80aa-60a7f5348d66","block_type":"box","text":"Merger Transaction Risk.","page_number":148,"box":{"x":116,"y":271,"width":200,"height":12}},{"id":"bb2cb7f0-b814-4a5e-8b0b-541a03bfc102","block_type":"box","text":"A Fund may buy stock of the target company in an announced merger","page_number":148,"box":{"x":317,"y":271,"width":531,"height":12}},{"id":"53c1be69-9e39-4edb-998f-de5d1c8ad994","block_type":"box","text":"transaction prior to the consummation of such transaction. In that circumstance, a Fund would expect","page_number":148,"box":{"x":116,"y":286,"width":757,"height":12}},{"id":"ce6a83fe-1e54-4ca5-b1bc-c9b7732023ee","block_type":"box","text":"to receive an amount (whether in cash, stock of the acquiring company or a combination of both) in","page_number":148,"box":{"x":116,"y":302,"width":740,"height":12}},{"id":"bd267c6e-a918-4c8f-ad13-8737e2d285d2","block_type":"box","text":"excess of the purchase price paid by the Fund for the target company’s stock. However, a Fund is","page_number":148,"box":{"x":116,"y":317,"width":733,"height":12}},{"id":"d2ad3ee4-af97-4896-b38d-86947f15af34","block_type":"box","text":"subject to the risk that the merger transaction may be canceled, delayed or restructured, in which case","page_number":148,"box":{"x":116,"y":333,"width":766,"height":12}},{"id":"b46bf079-59e3-49ff-992f-cf93b6ca4eeb","block_type":"box","text":"a Fund’s holding of the target company’s stock may not result in any profit for the Fund and may lose","page_number":148,"box":{"x":116,"y":348,"width":754,"height":12}},{"id":"f79af1e3-c9de-44c9-8bb9-7f710003c819","block_type":"box","text":"significant value.","page_number":148,"box":{"x":116,"y":364,"width":129,"height":12}},{"id":"43041eae-71ab-4874-a66b-a325dc1e95a5","block_type":"box","text":"Money Market Obligations of Domestic Banks, Foreign Banks and Foreign Branches of U.S.","page_number":148,"box":{"x":116,"y":394,"width":737,"height":12}},{"id":"b6341f4f-0302-4a99-9b88-755eb1c376ad","block_type":"box","text":"Banks.","page_number":148,"box":{"x":116,"y":409,"width":54,"height":10}},{"id":"5bc4db12-8542-4cda-a007-eb4e6d80d564","block_type":"box","text":"Certain Funds may purchase bank obligations, such as certificates of deposit, notes, bankers’","page_number":148,"box":{"x":171,"y":409,"width":705,"height":12}},{"id":"ea0877bc-43a4-4954-b655-9f15e4519a7b","block_type":"box","text":"acceptances and time deposits, including instruments issued or supported by the credit of U.S. or","page_number":148,"box":{"x":116,"y":425,"width":728,"height":12}},{"id":"9ea3d701-4d13-4fe0-aa75-a9e6d1603f91","block_type":"box","text":"foreign banks or savings institutions having total assets at the time of purchase in excess of $1 billion.","page_number":148,"box":{"x":116,"y":440,"width":761,"height":12}},{"id":"90128e18-9a7b-4c8f-888d-1c1a994761e4","block_type":"box","text":"These obligations may be general obligations of the parent bank or may be limited to the issuing","page_number":148,"box":{"x":116,"y":456,"width":719,"height":12}},{"id":"164d87a5-43e3-4336-b912-d631d425688a","block_type":"box","text":"branch or subsidiary by the terms of a specific obligation or by government regulation. The assets of a","page_number":148,"box":{"x":117,"y":471,"width":761,"height":12}},{"id":"de56a393-52a7-4cee-b198-4ac3de633276","block_type":"box","text":"bank or savings institution will be deemed to include the assets of its domestic and foreign branches","page_number":148,"box":{"x":117,"y":487,"width":747,"height":12}},{"id":"c324b182-f312-4a3f-b719-25e98c6f4d22","block_type":"box","text":"for purposes of a Fund’s investment policies. Investments in short-term bank obligations may include","page_number":148,"box":{"x":116,"y":502,"width":753,"height":12}},{"id":"f61d3003-55a6-4582-9142-3012a5a40cc7","block_type":"box","text":"obligations of foreign banks and domestic branches of foreign banks, and also foreign branches of","page_number":148,"box":{"x":116,"y":518,"width":734,"height":12}},{"id":"26eda370-28d8-4dea-9498-b22c24667470","block_type":"box","text":"domestic banks.","page_number":148,"box":{"x":116,"y":533,"width":126,"height":10}},{"id":"9315d856-669d-459f-aec5-114a47a48363","block_type":"box","text":"To the extent consistent with their investment objectives, a Fund may invest in debt obligations of","page_number":148,"box":{"x":116,"y":563,"width":727,"height":12}},{"id":"43c0a15e-75de-4cb5-bf47-e1b42673a324","block_type":"box","text":"domestic or foreign corporations and banks, and may acquire commercial obligations issued by","page_number":148,"box":{"x":116,"y":579,"width":713,"height":12}},{"id":"33128d65-74ea-4856-9c04-b947e19a4563","block_type":"box","text":"Canadian corporations and Canadian counterparts of U.S. corporations, as well as Europaper, which is","page_number":148,"box":{"x":117,"y":594,"width":769,"height":12}},{"id":"8d19e7fd-f445-44bd-9a81-974e783dfacc","block_type":"box","text":"U.S. dollar-denominated commercial paper of a foreign issuer.","page_number":148,"box":{"x":117,"y":610,"width":466,"height":12}},{"id":"f360bbaa-75f3-480e-9ee1-a6f719feb1c1","block_type":"box","text":"Money Market Securities.","page_number":148,"box":{"x":116,"y":640,"width":201,"height":12}},{"id":"51626b0f-8be9-4634-99d1-c34c93308aab","block_type":"box","text":"Certain Funds may invest in a broad range of short-term, high quality, U.S.","page_number":148,"box":{"x":318,"y":640,"width":564,"height":12}},{"id":"de5c02dc-07e1-4d37-abd8-6e7b80f250c9","block_type":"box","text":"dollar-denominated instruments, such as government, bank, commercial and other obligations that are","page_number":148,"box":{"x":116,"y":655,"width":765,"height":12}},{"id":"cfb8d324-d4fd-410a-a847-f337d30a8f54","block_type":"box","text":"available in the money markets. In particular, the Funds may invest in:","page_number":148,"box":{"x":116,"y":671,"width":519,"height":12}},{"id":"75e9dc50-21ce-4a3b-b094-6516bd980460","block_type":"box","text":"(a) U.S. dollar-denominated obligations issued or supported by the credit of U.S. or foreign banks","page_number":148,"box":{"x":150,"y":701,"width":729,"height":12}},{"id":"e074a9ce-c1f9-43d9-b9da-6faf49cb3853","block_type":"box","text":"or savings institutions with total assets in excess of $1 billion (including obligations of foreign","page_number":148,"box":{"x":184,"y":715,"width":684,"height":13}},{"id":"a7115d1a-001e-4524-a71a-8ecf23146e2f","block_type":"box","text":"branches of such banks);","page_number":148,"box":{"x":184,"y":732,"width":186,"height":12}},{"id":"fe5b90f2-d938-481b-bd7d-97fae7ea53a1","block_type":"box","text":"(b) high quality commercial paper and other obligations issued or guaranteed by U.S. and foreign","page_number":148,"box":{"x":150,"y":754,"width":728,"height":12}},{"id":"416f4d42-e780-4965-a6b7-7b50288d4a8e","block_type":"box","text":"corporations and other issuers rated (at the time of purchase) A-2 or higher by S&P, Prime-2","page_number":148,"box":{"x":184,"y":770,"width":686,"height":12}},{"id":"c5d04e91-9e31-481d-9049-e7931f988c4a","block_type":"box","text":"or higher by Moody’s or F-2 or higher by Fitch, as well as high quality corporate bonds rated","page_number":148,"box":{"x":184,"y":785,"width":681,"height":12}},{"id":"671fb3c9-6d43-4abf-bca2-15e14e4b2a5d","block_type":"box","text":"(at the time of purchase) A or higher by those rating agencies;","page_number":148,"box":{"x":184,"y":801,"width":459,"height":12}},{"id":"464b90f1-d6b3-4227-8d71-3de5015e40c9","block_type":"box","text":"(c) unrated notes, paper and other instruments that are of comparable quality to the instruments","page_number":148,"box":{"x":150,"y":823,"width":720,"height":13}},{"id":"d43bae5e-e5ad-454a-83dc-de54f06298db","block_type":"box","text":"described in (b) above as determined by the Fund’s Manager;","page_number":148,"box":{"x":184,"y":839,"width":463,"height":12}},{"id":"b8bba7fe-86fd-4dfe-a808-82f453ac8043","block_type":"box","text":"(d) asset-backed securities (including interests in pools of assets such as mortgages, installment","page_number":148,"box":{"x":150,"y":862,"width":730,"height":12}},{"id":"361d6ac5-2773-481e-80c9-e2fbf2206844","block_type":"box","text":"purchase obligations and credit card receivables);","page_number":148,"box":{"x":184,"y":877,"width":374,"height":12}},{"id":"dad85bf3-d052-40fb-8489-81985c0370f0","block_type":"box","text":"II-64","page_number":148,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"8cbdb93d-cdc6-4223-928e-ed56ea23954f","block_type":"box","text":"NM0926U-5926888-148/257","page_number":148,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"3de6f2da-6dbd-4239-84cd-c4b150ea8554","block_type":"box","text":"(e) securities issued or guaranteed as to principal and interest by the U.S. Government or by its","page_number":149,"box":{"x":150,"y":87,"width":722,"height":12}},{"id":"d3a5c9a0-eb36-47de-a6d7-2b21d1f9c222","block_type":"box","text":"agencies or authorities and related custodial receipts;","page_number":149,"box":{"x":184,"y":103,"width":401,"height":12}},{"id":"e33fee4b-702c-4f6b-b78e-3b83c279f6f6","block_type":"box","text":"(f) dollar-denominated securities issued or guaranteed by foreign governments or their political","page_number":149,"box":{"x":150,"y":126,"width":719,"height":12}},{"id":"bd543d6c-1a85-4be9-a977-812cfc1d6079","block_type":"box","text":"subdivisions, agencies or authorities;","page_number":149,"box":{"x":184,"y":141,"width":279,"height":12}},{"id":"2f79cbd7-010a-474d-a353-de0f04624dbf","block_type":"box","text":"(g) funding agreements issued by highly-rated U.S. insurance companies;","page_number":149,"box":{"x":150,"y":165,"width":561,"height":12}},{"id":"6ed7c970-b87d-4dfe-ba91-60e4f5d92264","block_type":"box","text":"(h) securities issued or guaranteed by state or local governmental bodies;","page_number":149,"box":{"x":150,"y":188,"width":560,"height":12}},{"id":"b2578cb3-87fd-4392-9801-dc38e30baaa1","block_type":"box","text":"(i) repurchase agreements relating to the above instruments;","page_number":149,"box":{"x":150,"y":211,"width":469,"height":12}},{"id":"f1d5853f-3bb6-4253-ab08-39060ca55cb0","block_type":"box","text":"(j) municipal bonds and notes whose principal and interest payments are guaranteed by the U.S.","page_number":149,"box":{"x":150,"y":234,"width":736,"height":12}},{"id":"0039c3e8-61fd-4875-ac57-81cd5ada7352","block_type":"box","text":"Government or one of its agencies or authorities or which otherwise depend directly or","page_number":149,"box":{"x":184,"y":250,"width":646,"height":12}},{"id":"b3701ea3-7642-4c7b-bf41-69895041c4e1","block_type":"box","text":"indirectly on the credit of the United States;","page_number":149,"box":{"x":184,"y":265,"width":325,"height":12}},{"id":"bff4c275-3bdb-416f-8fe5-9c87048dcf02","block_type":"box","text":"(k) fixed and variable rate notes and similar debt instruments rated MIG-2, VMIG-2 or Prime-2 or","page_number":149,"box":{"x":150,"y":289,"width":730,"height":12}},{"id":"74cc5d21-34ac-490f-9d16-a7bab979c3bf","block_type":"box","text":"higher by Moody’s, SP-2 or A-2 or higher by S&P, or F-2 or higher by Fitch;","page_number":149,"box":{"x":184,"y":304,"width":563,"height":12}},{"id":"dfdd8e56-b4d2-468b-b5e8-7bbc33730b03","block_type":"box","text":"(l) tax-exempt commercial paper and similar debt instruments rated Prime-2 or higher by","page_number":149,"box":{"x":150,"y":327,"width":675,"height":12}},{"id":"ab49ed3f-be8c-4eb3-9712-bfd04410b3a2","block_type":"box","text":"Moody’s, A-2 or higher by S&P, or F-2 or higher by Fitch;","page_number":149,"box":{"x":184,"y":343,"width":428,"height":12}},{"id":"64214d7f-02fa-4ecc-973a-100f062bbe02","block_type":"box","text":"(m) municipal bonds rated A or higher by Moody’s, S&P or Fitch;","page_number":149,"box":{"x":150,"y":366,"width":488,"height":12}},{"id":"7a1023f2-4d0e-458a-b3ee-798c3dd86760","block_type":"box","text":"(n) unrated notes, paper or other instruments that are of comparable quality to the instruments","page_number":149,"box":{"x":150,"y":389,"width":713,"height":12}},{"id":"8bf6c016-6b04-46c8-8f62-ffb504a9431f","block_type":"box","text":"described above, as determined by the Fund’s Manager under guidelines established by the","page_number":149,"box":{"x":184,"y":405,"width":688,"height":12}},{"id":"9bd87acf-e52d-480e-a51f-d4dd9b8c54d9","block_type":"box","text":"Board; and","page_number":149,"box":{"x":184,"y":420,"width":86,"height":12}},{"id":"c603dd17-a400-4a61-b0e1-c3e9a84e9a9d","block_type":"box","text":"(o) municipal bonds and notes which are guaranteed as to principal and interest by the U.S.","page_number":149,"box":{"x":150,"y":444,"width":693,"height":12}},{"id":"fb43e6d9-2dfe-4ffa-96d0-29512bf9bbec","block_type":"box","text":"Government or an agency or instrumentality thereof or which otherwise depend directly or","page_number":149,"box":{"x":184,"y":459,"width":671,"height":12}},{"id":"0eaba150-7214-4816-8ae1-ccb6d3499374","block_type":"box","text":"indirectly on the credit of the United States.","page_number":149,"box":{"x":184,"y":475,"width":325,"height":12}},{"id":"0969deef-b372-4dc2-b8f3-e601c82ea7ba","block_type":"box","text":"Mortgage-Related Securities.","page_number":149,"box":{"x":116,"y":506,"width":236,"height":12}},{"id":"919caa0e-cd70-4c2b-88d2-6e3a0246a4c8","block_type":"box","text":"Mortgage-Backed Securities.","page_number":149,"box":{"x":116,"y":529,"width":214,"height":12}},{"id":"5bfe3207-384a-4f69-ba31-111b06e51cb2","block_type":"box","text":"Mortgage-backed securities represent interests in pools of mortgages in","page_number":149,"box":{"x":332,"y":529,"width":544,"height":12}},{"id":"7e3f85dc-1d41-4510-86f0-346a9ae64f87","block_type":"box","text":"which payments of both principal and interest on the securities are generally made monthly, in effect","page_number":149,"box":{"x":116,"y":544,"width":749,"height":12}},{"id":"eec5f362-3fdc-4e69-8671-fb6cb11a8146","block_type":"box","text":"“passing through” monthly payments made by borrowers on the residential or commercial mortgage","page_number":149,"box":{"x":116,"y":560,"width":745,"height":12}},{"id":"056add9c-9d88-4403-a047-b0cef0a8a790","block_type":"box","text":"loans that underlie the securities (net of any fees paid to the issuer or guarantor of the securities).","page_number":149,"box":{"x":117,"y":575,"width":728,"height":12}},{"id":"67a372b3-6eae-41db-8f3e-664abfd85d9f","block_type":"box","text":"Mortgage-backed securities differ from other forms of debt securities, which normally provide for","page_number":149,"box":{"x":117,"y":591,"width":718,"height":12}},{"id":"60efbbb5-07b2-4769-ac35-6705f0f06f6a","block_type":"box","text":"periodic payment of interest in fixed amounts with principal payments at maturity or specified call","page_number":149,"box":{"x":117,"y":606,"width":721,"height":12}},{"id":"391588a5-9797-4676-b024-745a88ac58fc","block_type":"box","text":"dates.","page_number":149,"box":{"x":116,"y":622,"width":50,"height":9}},{"id":"ab8ef83d-060c-4eb3-ae51-43b48f227617","block_type":"box","text":"Mortgage-backed securities are subject to the general risks associated with investing in real estate","page_number":149,"box":{"x":117,"y":653,"width":736,"height":12}},{"id":"0dc6d1ae-baff-4618-b12b-ff06646b3e94","block_type":"box","text":"securities; that is, they may lose value if the value of the underlying real estate to which a pool of","page_number":149,"box":{"x":116,"y":668,"width":718,"height":12}},{"id":"ffe7961b-22e6-4825-b25f-04b720c32274","block_type":"box","text":"mortgages relates declines. In addition, investments in mortgage-backed securities involve certain","page_number":149,"box":{"x":117,"y":684,"width":726,"height":12}},{"id":"c5346032-3352-4880-a86d-a5378bb68f57","block_type":"box","text":"specific risks. These risks include the failure of a party to meet its commitments under the related","page_number":149,"box":{"x":116,"y":699,"width":720,"height":13}},{"id":"cb869aca-2949-46a3-9510-85c49ce60e27","block_type":"box","text":"operative documents, adverse interest rate changes and the effects of prepayments on mortgage cash","page_number":149,"box":{"x":116,"y":715,"width":762,"height":12}},{"id":"e0928d1f-0737-4ef0-9b88-0d593f8adefa","block_type":"box","text":"flows. Mortgage-backed securities are “pass-through” securities, meaning that principal and interest","page_number":149,"box":{"x":116,"y":730,"width":740,"height":13}},{"id":"1cd61aa1-fb70-4d90-ad62-bc4be5d9700c","block_type":"box","text":"payments made by the borrower on the underlying mortgages are passed through to a Fund.","page_number":149,"box":{"x":117,"y":746,"width":687,"height":12}},{"id":"99765daf-588a-4e9a-82cf-2731c7bb92ea","block_type":"box","text":"Accordingly, the value of mortgage-backed securities in which a Fund invests may be particularly","page_number":149,"box":{"x":116,"y":761,"width":720,"height":13}},{"id":"781f6b15-6c36-4aec-8181-9a342351945b","block_type":"box","text":"sensitive to changes in prevailing interest rates, and, like other fixed income investments, the ability of","page_number":149,"box":{"x":116,"y":777,"width":757,"height":12}},{"id":"a7a19334-e090-4c5c-b231-02d94aee935b","block_type":"box","text":"a Fund to utilize these instruments successfully may depend in part upon the ability of the Manager to","page_number":149,"box":{"x":116,"y":792,"width":754,"height":13}},{"id":"c67099a7-b6e3-48d2-9887-ff1bddc01729","block_type":"box","text":"forecast interest rates and other economic factors correctly. The value of mortgage-backed securities,","page_number":149,"box":{"x":116,"y":808,"width":755,"height":12}},{"id":"866972fa-835e-4de5-838d-4045623eb043","block_type":"box","text":"like that of traditional fixed-income securities, typically increases when interest rates fall and decreases","page_number":149,"box":{"x":117,"y":823,"width":762,"height":13}},{"id":"90547ae3-2786-4702-9ca4-3625d100d645","block_type":"box","text":"when interest rates rise. However, mortgage-backed securities differ from traditional fixed-income","page_number":149,"box":{"x":116,"y":839,"width":729,"height":12}},{"id":"b5ef2d12-d922-4c12-9cce-66dccca9d696","block_type":"box","text":"securities because of their potential for prepayment without penalty. The price paid by a Fund for its","page_number":149,"box":{"x":116,"y":854,"width":745,"height":13}},{"id":"c7926a21-e226-4980-8dce-09a028d3ba2b","block_type":"box","text":"mortgage-backed securities, the yield the Fund expects to receive from such securities and the","page_number":149,"box":{"x":117,"y":870,"width":709,"height":12}},{"id":"da2656ec-e82c-4f81-9f73-0f51ab757ee8","block_type":"box","text":"II-65","page_number":149,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"16a664e3-ca26-4af0-a726-03ace46a4154","block_type":"box","text":"NM0926U-5926888-149/257","page_number":149,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"df266da1-17d4-47f1-a4ab-9a65fe4b4778","block_type":"box","text":"weighted average life of the securities are based on a number of factors, including the anticipated rate","page_number":150,"box":{"x":116,"y":87,"width":762,"height":12}},{"id":"651b5106-7a0d-494b-8cac-a3bae92b4764","block_type":"box","text":"of prepayment of the underlying mortgages. In a period of declining interest rates, borrowers may","page_number":150,"box":{"x":116,"y":102,"width":727,"height":13}},{"id":"29cf4fdd-8754-4c32-a73d-e2c55d908e65","block_type":"box","text":"prepay the underlying mortgages more quickly than anticipated, thereby reducing the yield to maturity","page_number":150,"box":{"x":117,"y":118,"width":757,"height":12}},{"id":"6f908652-49d7-4034-9774-189661bccdab","block_type":"box","text":"and the average life of the mortgage-backed securities. Moreover, when a Fund reinvests the proceeds","page_number":150,"box":{"x":116,"y":134,"width":772,"height":12}},{"id":"a684848b-6398-4f6f-86cc-665faf7a90b4","block_type":"box","text":"of a prepayment in these circumstances, it will likely receive a rate of interest that is lower than the rate","page_number":150,"box":{"x":116,"y":149,"width":769,"height":12}},{"id":"e0dc7977-d09d-48fc-ae10-c60468797441","block_type":"box","text":"on the security that was prepaid.","page_number":150,"box":{"x":116,"y":165,"width":247,"height":12}},{"id":"9da08ce3-f3a1-44a6-8a63-5563f9688180","block_type":"box","text":"To the extent that a Fund purchases mortgage-backed securities at a premium, mortgage foreclosures","page_number":150,"box":{"x":116,"y":196,"width":766,"height":12}},{"id":"d2e7126b-c2ac-416f-8c9d-3a4efcd87090","block_type":"box","text":"and principal prepayments may result in a loss to the extent of the premium paid. If a Fund buys such","page_number":150,"box":{"x":116,"y":211,"width":758,"height":12}},{"id":"fd97c38a-cb31-4956-be26-6e41bb2ecb02","block_type":"box","text":"securities at a discount, both scheduled payments of principal and unscheduled prepayments will","page_number":150,"box":{"x":116,"y":227,"width":726,"height":12}},{"id":"ace837de-9a62-48d8-8f69-5de5acd886c2","block_type":"box","text":"increase current and total returns and will accelerate the recognition of income, which, when distributed","page_number":150,"box":{"x":117,"y":242,"width":771,"height":12}},{"id":"978e89c8-c01f-457f-8e87-ed8320430e2d","block_type":"box","text":"to shareholders, will be taxable as ordinary income. In a period of rising interest rates, prepayments of","page_number":150,"box":{"x":116,"y":258,"width":762,"height":12}},{"id":"15640352-7eca-405e-b3d6-433657be0da5","block_type":"box","text":"the underlying mortgages may occur at a slower than expected rate, creating maturity extension risk.","page_number":150,"box":{"x":116,"y":273,"width":753,"height":12}},{"id":"befed98f-4ce5-4e01-9448-26fcd27fecdd","block_type":"box","text":"This particular risk may effectively change a security that was considered short- or intermediate-term at","page_number":150,"box":{"x":116,"y":289,"width":771,"height":12}},{"id":"f7a880c8-9710-4e98-82f0-12317f912da7","block_type":"box","text":"the time of purchase into a long-term security. Since the value of long-term securities generally","page_number":150,"box":{"x":116,"y":304,"width":709,"height":12}},{"id":"8af0d152-0998-4264-b29a-9a9e3809f73f","block_type":"box","text":"fluctuates more widely in response to changes in interest rates than that of shorter-term securities,","page_number":150,"box":{"x":116,"y":320,"width":736,"height":12}},{"id":"4cd94225-21b0-4e0c-97d9-852c2f84953f","block_type":"box","text":"maturity extension risk could increase the inherent volatility of the Fund. Under certain interest rate and","page_number":150,"box":{"x":117,"y":335,"width":769,"height":12}},{"id":"1339a505-66af-488d-afe3-7c29a7abeb47","block_type":"box","text":"prepayment scenarios, a Fund may fail to recoup fully its investment in mortgage-backed securities","page_number":150,"box":{"x":117,"y":351,"width":740,"height":12}},{"id":"d2aadf9b-479f-4ee7-98ed-7934e721e3b4","block_type":"box","text":"notwithstanding any direct or indirect governmental or agency guarantee.","page_number":150,"box":{"x":117,"y":366,"width":547,"height":12}},{"id":"6c188326-b398-4ac6-b77c-e471f03ad537","block_type":"box","text":"There are currently three types of mortgage pass-through securities: (1) those issued by the U.S.","page_number":150,"box":{"x":116,"y":397,"width":725,"height":12}},{"id":"232d4330-a287-4b0a-9bf6-7d7a41425632","block_type":"box","text":"Government or one of its agencies or instrumentalities, such as the Government National Mortgage","page_number":150,"box":{"x":117,"y":413,"width":742,"height":12}},{"id":"61c6985b-74ee-4c4d-aeed-778502911128","block_type":"box","text":"Association (“Ginnie Mae”), the Federal National Mortgage Association (“Fannie Mae”) and the Federal","page_number":150,"box":{"x":116,"y":428,"width":770,"height":12}},{"id":"a13698b4-be24-43ff-9919-40b0408c471a","block_type":"box","text":"Home Loan Mortgage Corporation (“Freddie Mac”); (2) those issued by private issuers that represent","page_number":150,"box":{"x":117,"y":444,"width":753,"height":12}},{"id":"83eaa953-e45b-44a4-9d36-9d01d64364b1","block_type":"box","text":"an interest in or are collateralized by pass-through securities issued or guaranteed by the U.S.","page_number":150,"box":{"x":116,"y":459,"width":704,"height":12}},{"id":"a6f2aa85-36f2-4683-83f7-b043c148259e","block_type":"box","text":"Government or one of its agencies or instrumentalities; and (3) those issued by private issuers that","page_number":150,"box":{"x":117,"y":475,"width":737,"height":12}},{"id":"91c3c981-0729-4f27-a473-a3f702cfe7bb","block_type":"box","text":"represent an interest in or are collateralized by whole mortgage loans or pass-through securities","page_number":150,"box":{"x":117,"y":490,"width":717,"height":12}},{"id":"4f6755ec-57d6-4da7-bf0f-deb831051d1d","block_type":"box","text":"without a government guarantee but that usually have some form of private credit enhancement.","page_number":150,"box":{"x":116,"y":506,"width":720,"height":12}},{"id":"f4f5bbff-b110-401d-92db-fcea56f74286","block_type":"box","text":"Ginnie Mae is a wholly owned U.S. Government corporation within the Department of Housing and","page_number":150,"box":{"x":117,"y":537,"width":736,"height":12}},{"id":"a3fb4719-f04d-4fa5-a51f-585749de1821","block_type":"box","text":"Urban Development. Ginnie Mae is authorized to guarantee, with the full faith and credit of the U.S.","page_number":150,"box":{"x":117,"y":552,"width":741,"height":12}},{"id":"61b1898e-ad54-4f7e-a049-dbfe78817240","block_type":"box","text":"Government, the timely payment of principal and interest on securities issued by the institutions","page_number":150,"box":{"x":117,"y":568,"width":713,"height":12}},{"id":"35cbadd2-5b60-410a-9d87-b0f877c72d06","block_type":"box","text":"approved by Ginnie Mae (such as savings and loan institutions, commercial banks and mortgage","page_number":150,"box":{"x":116,"y":583,"width":725,"height":12}},{"id":"a7ed71f8-6db6-4ce2-bb91-551434f7b48b","block_type":"box","text":"banks), and backed by pools of Federal Housing Administration (“FHA”)-insured or Veterans’","page_number":150,"box":{"x":117,"y":599,"width":693,"height":12}},{"id":"4b119a87-4dde-4b89-af42-9fcd516aeaad","block_type":"box","text":"Administration (“VA”)-guaranteed mortgages. Pass-through certificates guaranteed by Ginnie Mae","page_number":150,"box":{"x":116,"y":614,"width":733,"height":12}},{"id":"582c73f0-716d-4540-997d-cb49947c9147","block_type":"box","text":"(such certificates are also known as “Ginnie Maes”) are guaranteed as to the timely payment of","page_number":150,"box":{"x":117,"y":630,"width":711,"height":12}},{"id":"7bfb414b-a95f-47fa-973c-cc6c74d6e158","block_type":"box","text":"principal and interest by Ginnie Mae, whose guarantee is backed by the full faith and credit of the","page_number":150,"box":{"x":117,"y":645,"width":725,"height":12}},{"id":"48c9019b-47cc-4a53-ac52-af7328e497b1","block_type":"box","text":"United States. Ginnie Mae certificates also are supported by the authority of Ginnie Mae to borrow","page_number":150,"box":{"x":117,"y":661,"width":729,"height":12}},{"id":"1ecb23e2-8015-4540-8794-8e8cbbba95d2","block_type":"box","text":"funds from the U.S. Treasury Department to make payments under its guarantee. Mortgage-related","page_number":150,"box":{"x":116,"y":676,"width":737,"height":12}},{"id":"1ede687f-da17-4b3e-9e21-3fbf7ed6dfd5","block_type":"box","text":"securities issued by Fannie Mae include Fannie Mae guaranteed Mortgage Pass-Through Certificates","page_number":150,"box":{"x":116,"y":692,"width":756,"height":12}},{"id":"fc5f4eba-e56d-43ab-8559-0e18fb98d831","block_type":"box","text":"(also known as “Fannie Maes”), which are guaranteed as to timely payment of principal and interest by","page_number":150,"box":{"x":117,"y":707,"width":761,"height":12}},{"id":"aa3bb1fb-bf0a-43cf-958b-daa539b52aff","block_type":"box","text":"Fannie Mae. They are not backed by or entitled to the full faith and credit of the United States, but are","page_number":150,"box":{"x":117,"y":723,"width":754,"height":12}},{"id":"08faf029-3914-425b-9232-57df4a147e05","block_type":"box","text":"supported by the right of Fannie Mae to borrow from the U.S. Treasury Department. Fannie Mae was","page_number":150,"box":{"x":116,"y":738,"width":750,"height":12}},{"id":"2cc53f0c-c5e6-4aab-9680-4890c2cc046d","block_type":"box","text":"established as a federal agency in 1938 and in 1968 was chartered by Congress as a private","page_number":150,"box":{"x":116,"y":754,"width":690,"height":12}},{"id":"a874df61-d55b-45bb-9191-118ee83c671f","block_type":"box","text":"shareholder-owned company. Mortgage-related securities issued by Freddie Mac include Freddie Mac","page_number":150,"box":{"x":116,"y":769,"width":760,"height":12}},{"id":"ff801fe1-1f51-42f7-98d7-204180116dca","block_type":"box","text":"Mortgage Participation Certificates (also known as “Freddie Macs” or “PCs”). Freddie Mac is a","page_number":150,"box":{"x":117,"y":785,"width":697,"height":12}},{"id":"d660cae4-45d2-4fc0-bc81-761c71810348","block_type":"box","text":"stockholder-owned corporation chartered by Congress in 1970. Freddie Macs are not guaranteed by","page_number":150,"box":{"x":116,"y":800,"width":745,"height":12}},{"id":"115e4602-143a-4dc1-89f7-9e2cea13513e","block_type":"box","text":"the United States or by any Federal Home Loan Banks and do not constitute a debt or obligation of the","page_number":150,"box":{"x":116,"y":816,"width":763,"height":12}},{"id":"b3bf8c2f-7ee1-4fdd-8c94-3e217728830c","block_type":"box","text":"United States or of any Federal Home Loan Bank. Freddie Macs entitle the holder to timely payment of","page_number":150,"box":{"x":117,"y":831,"width":767,"height":12}},{"id":"fb052665-d8e4-4721-99ec-1e7043c2ba7e","block_type":"box","text":"interest, which is guaranteed by Freddie Mac. Freddie Mac guarantees either ultimate collection or","page_number":150,"box":{"x":117,"y":847,"width":735,"height":12}},{"id":"013ef3b0-a012-4f9f-89e4-e222a275e999","block_type":"box","text":"timely payment of all principal payments on the underlying mortgage loans. While Freddie Mac","page_number":150,"box":{"x":116,"y":862,"width":707,"height":12}},{"id":"676908cf-f8ed-4177-81b3-049e398f0363","block_type":"box","text":"generally does not guarantee timely payment of principal, Freddie Mac may remit the amount due on","page_number":150,"box":{"x":116,"y":878,"width":753,"height":12}},{"id":"858bafb1-251b-4c04-9cb4-53d3652c81ba","block_type":"box","text":"II-66","page_number":150,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"59fef979-3000-42cb-b531-8e96c1c6e01c","block_type":"box","text":"NM0926U-5926888-150/257","page_number":150,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"7747e7f8-7da7-4e05-a3ee-8f380062a473","block_type":"box","text":"account of its guarantee of ultimate payment of principal at any time after default on an underlying","page_number":151,"box":{"x":116,"y":87,"width":732,"height":12}},{"id":"5100c446-5dc7-496c-afee-c2f01c0efd8d","block_type":"box","text":"mortgage, but in no event later than one year after it becomes payable.","page_number":151,"box":{"x":117,"y":102,"width":532,"height":13}},{"id":"9df2c773-ff92-4905-b8bc-4c3cf84fa03c","block_type":"box","text":"Private mortgage pass-through securities are structured similarly to Ginnie Mae, Fannie Mae, and","page_number":151,"box":{"x":117,"y":134,"width":730,"height":12}},{"id":"95511caf-cac6-4f2d-8d2c-f146a0c5a13f","block_type":"box","text":"Freddie Mac mortgage pass-through securities and are issued by originators of and investors in","page_number":151,"box":{"x":117,"y":149,"width":714,"height":12}},{"id":"3901cfc6-5282-4f62-b578-4f59f019ec40","block_type":"box","text":"mortgage loans, including depository institutions, mortgage banks, investment banks and special","page_number":151,"box":{"x":117,"y":165,"width":722,"height":12}},{"id":"16f3c2ac-1908-43f9-b8cd-9a30c15f9159","block_type":"box","text":"purpose subsidiaries of the foregoing.","page_number":151,"box":{"x":117,"y":180,"width":284,"height":12}},{"id":"d493b0d2-6bf2-4983-bbd7-92781b68686e","block_type":"box","text":"Pools created by private mortgage pass-through issuers generally offer a higher rate of interest than","page_number":151,"box":{"x":117,"y":211,"width":747,"height":12}},{"id":"3d29f0af-92ef-484c-9cec-a9bbb34c65a8","block_type":"box","text":"government and government-related pools because there are no direct or indirect government or","page_number":151,"box":{"x":116,"y":227,"width":723,"height":12}},{"id":"77d6e4a2-274c-46d6-aa6f-4fd6772a4ec5","block_type":"box","text":"agency guarantees of payments in the private pools. However, timely payment of interest and principal","page_number":151,"box":{"x":116,"y":242,"width":767,"height":12}},{"id":"1691dc0e-cf04-42b7-a8c4-99e8387bbfa0","block_type":"box","text":"of these pools may be supported by various forms of insurance or guarantees, including individual","page_number":151,"box":{"x":116,"y":258,"width":732,"height":12}},{"id":"d3d327f6-2c20-44c1-ac4e-0827b318f781","block_type":"box","text":"loan, title, pool and hazard insurance and letters of credit. The insurance and guarantees are issued by","page_number":151,"box":{"x":117,"y":273,"width":769,"height":12}},{"id":"fdb94cfa-c2ec-4f99-b489-69f7866dc32c","block_type":"box","text":"governmental entities, private insurers and the mortgage poolers. The insurance and guarantees and","page_number":151,"box":{"x":116,"y":289,"width":756,"height":12}},{"id":"f4ad73e7-bb1f-4282-9cc8-e55ff039915e","block_type":"box","text":"the creditworthiness of the issuers thereof will be considered in determining whether a mortgage","page_number":151,"box":{"x":116,"y":304,"width":720,"height":12}},{"id":"0f464027-4245-485b-981f-573f8dc31b40","block_type":"box","text":"related security meets a Fund’s investment quality standards. There can be no assurance that the","page_number":151,"box":{"x":117,"y":320,"width":731,"height":12}},{"id":"7a9c4516-b4c7-47d6-9909-70c7bb1abad6","block_type":"box","text":"private insurers or guarantors can meet their obligations under the insurance policies or guarantee","page_number":151,"box":{"x":117,"y":335,"width":734,"height":12}},{"id":"c7e369e2-b343-4d29-a0e0-c4fd2caa18e2","block_type":"box","text":"arrangements. Private mortgage pass-through securities may be bought without insurance or","page_number":151,"box":{"x":116,"y":351,"width":696,"height":12}},{"id":"6454a0ed-da5e-4bfd-9912-e8a0c6db6e0f","block_type":"box","text":"guarantees if, through an examination of the loan experience and practices of the originator/servicers","page_number":151,"box":{"x":116,"y":366,"width":756,"height":12}},{"id":"1d735983-9c68-49cc-aa51-64cad449191f","block_type":"box","text":"and poolers, the Manager determines that the securities meet a Fund’s quality standards. Any","page_number":151,"box":{"x":116,"y":382,"width":703,"height":12}},{"id":"6c43fac1-be2a-495d-8353-e061ff373a2b","block_type":"box","text":"mortgage-related securities that are issued by private issuers have some exposure to subprime loans","page_number":151,"box":{"x":117,"y":397,"width":757,"height":12}},{"id":"9f770da8-f511-49d0-85c4-641e2e5a7300","block_type":"box","text":"as well as to the mortgage and credit markets generally.","page_number":151,"box":{"x":116,"y":413,"width":422,"height":12}},{"id":"18875019-8310-44ac-a709-3c34ef2efe3c","block_type":"box","text":"In addition, mortgage-related securities that are issued by private issuers are not subject to the","page_number":151,"box":{"x":117,"y":444,"width":707,"height":12}},{"id":"10b3bbf9-36be-4e4e-8d7d-dc9b5dc18b88","block_type":"box","text":"underwriting requirements for the underlying mortgages that are applicable to those mortgage-related","page_number":151,"box":{"x":117,"y":459,"width":757,"height":12}},{"id":"19212890-7aaf-4baa-810b-050879f638a5","block_type":"box","text":"securities that have a government or government-sponsored entity guarantee. As a result, the","page_number":151,"box":{"x":116,"y":475,"width":702,"height":12}},{"id":"6a8a93b9-645a-4ca0-a077-8b8e98305701","block_type":"box","text":"mortgage loans underlying private mortgage-related securities may, and frequently do, have less","page_number":151,"box":{"x":117,"y":490,"width":722,"height":12}},{"id":"0463b0c8-d05a-426d-8f59-defd39e12d9c","block_type":"box","text":"favorable collateral, credit risk or other underwriting characteristics than government or government","page_number":151,"box":{"x":116,"y":506,"width":743,"height":12}},{"id":"9185b196-5bc1-4876-ae3d-8e46d6e943fd","block_type":"box","text":"sponsored mortgage-related securities and have wider variances in a number of terms including","page_number":151,"box":{"x":116,"y":521,"width":717,"height":12}},{"id":"f77737d7-037c-4849-a970-75c56255b244","block_type":"box","text":"interest rate, term, size, purpose and borrower characteristics. Privately issued pools more frequently","page_number":151,"box":{"x":117,"y":537,"width":755,"height":12}},{"id":"ce82c97f-5840-4ea9-8c61-6d2cd27301f1","block_type":"box","text":"include second mortgages, high loan-to-value mortgages and manufactured housing loans. The","page_number":151,"box":{"x":117,"y":552,"width":714,"height":12}},{"id":"9cd7825b-1f02-44b9-98ef-14dea31b07ef","block_type":"box","text":"coupon rates and maturities of the underlying mortgage loans in a private-label mortgage-related","page_number":151,"box":{"x":116,"y":568,"width":723,"height":12}},{"id":"5842b054-af09-45ea-a78c-10742ffe5e20","block_type":"box","text":"securities pool may vary to a greater extent than those included in a government guaranteed pool, and","page_number":151,"box":{"x":116,"y":583,"width":766,"height":12}},{"id":"bd4ba410-2ca3-409c-8682-47c22786af7a","block_type":"box","text":"the pool may include subprime mortgage loans. Subprime loans refer to loans made to borrowers with","page_number":151,"box":{"x":116,"y":599,"width":762,"height":12}},{"id":"6441b94f-47a2-48a4-8a27-7ae001307152","block_type":"box","text":"weakened credit histories or with a lower capacity to make timely payments on their loans. For these","page_number":151,"box":{"x":116,"y":614,"width":751,"height":12}},{"id":"26f0b025-bf56-43ea-bd02-2211bd5151d3","block_type":"box","text":"reasons, the loans underlying these securities have had in many cases higher default rates than those","page_number":151,"box":{"x":117,"y":630,"width":763,"height":12}},{"id":"09e65c93-b4f1-4ceb-9f5b-53d2e3ce08d0","block_type":"box","text":"loans that meet government underwriting requirements.","page_number":151,"box":{"x":117,"y":645,"width":416,"height":12}},{"id":"19a0c318-fbda-44e8-a9f3-5bb07254d792","block_type":"box","text":"The risk of non-payment is greater for mortgage-related securities that are backed by mortgage pools","page_number":151,"box":{"x":116,"y":676,"width":753,"height":12}},{"id":"18e8ff2d-dbf1-4a82-89dc-f5ab65edd182","block_type":"box","text":"that contain subprime loans, but a level of risk exists for all loans. Market factors adversely affecting","page_number":151,"box":{"x":116,"y":692,"width":740,"height":12}},{"id":"c76b29fa-47e8-4ebf-99e8-2643a12a9ef4","block_type":"box","text":"mortgage loan repayments may include a general economic turndown, high unemployment, a general","page_number":151,"box":{"x":117,"y":707,"width":754,"height":12}},{"id":"bd4c25f1-7f60-4d0a-91fb-d725d05db824","block_type":"box","text":"slowdown in the real estate market, a drop in the market prices of real estate, or an increase in interest","page_number":151,"box":{"x":116,"y":723,"width":763,"height":12}},{"id":"5d1a2319-defa-4b07-879f-dd0fdb88ff24","block_type":"box","text":"rates resulting in higher mortgage payments by holders of adjustable rate mortgages.","page_number":151,"box":{"x":117,"y":738,"width":631,"height":12}},{"id":"d7a32b4a-4c6b-4938-91e4-bff7c4c818b8","block_type":"box","text":"Privately issued mortgage-related securities are not traded on an exchange and there may be a limited","page_number":151,"box":{"x":117,"y":769,"width":761,"height":12}},{"id":"d32331e0-e8b5-4a5c-9ea5-fce4ddca4fcf","block_type":"box","text":"market for the securities, especially when there is a perceived weakness in the mortgage and real","page_number":151,"box":{"x":117,"y":785,"width":724,"height":12}},{"id":"70f9928d-82d3-4584-bde4-0dd2f3b65b09","block_type":"box","text":"estate market sectors. Without an active trading market, mortgage-related securities held in a Fund’s","page_number":151,"box":{"x":116,"y":800,"width":748,"height":12}},{"id":"033930a2-6b7e-49ac-9c2d-392063191307","block_type":"box","text":"portfolio may be particularly difficult to value because of the complexities involved in assessing the","page_number":151,"box":{"x":117,"y":816,"width":729,"height":12}},{"id":"21a3292f-27b5-4505-b44d-e41b1c9c5c54","block_type":"box","text":"value of the underlying mortgage loans.","page_number":151,"box":{"x":116,"y":831,"width":299,"height":12}},{"id":"9b0eda14-df55-445d-80d7-fb0e53249489","block_type":"box","text":"Collateralized Mortgage Obligations (“CMOs”).","page_number":151,"box":{"x":117,"y":862,"width":343,"height":12}},{"id":"bf857b5e-2cd9-4600-9a5b-e40b955fd749","block_type":"box","text":"CMOs are debt obligations collateralized by residential","page_number":151,"box":{"x":462,"y":862,"width":415,"height":12}},{"id":"d5388ca2-5245-4aed-ba72-30c78513dd86","block_type":"box","text":"or commercial mortgage loans or residential or commercial mortgage pass-through securities. Interest","page_number":151,"box":{"x":116,"y":878,"width":762,"height":12}},{"id":"80c19bed-41bf-4d33-a2ab-c7e5ba420764","block_type":"box","text":"II-67","page_number":151,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"71404c97-a85e-4a84-b963-7da2300bec0f","block_type":"box","text":"NM0926U-5926888-151/257","page_number":151,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"c30079e3-3835-46e2-9646-7bf2b9357c42","block_type":"box","text":"and prepaid principal are generally paid monthly. CMOs may be collateralized by whole mortgage","page_number":152,"box":{"x":116,"y":87,"width":729,"height":12}},{"id":"31959dee-1269-405b-8297-8b044afc88a4","block_type":"box","text":"loans or private mortgage pass-through securities but are more typically collateralized by portfolios of","page_number":152,"box":{"x":117,"y":102,"width":755,"height":13}},{"id":"a240dff1-a64b-4af2-888b-9ac180b00104","block_type":"box","text":"mortgage pass-through securities guaranteed by Ginnie Mae, Freddie Mac, or Fannie Mae. The issuer","page_number":152,"box":{"x":117,"y":118,"width":765,"height":12}},{"id":"29b5cd23-de6c-4ac6-8eea-792fa838568b","block_type":"box","text":"of a series of CMOs may elect to be treated as a Real Estate Mortgage Investment Conduit (“REMIC”).","page_number":152,"box":{"x":116,"y":134,"width":769,"height":12}},{"id":"adba0ba3-0cea-4602-ab8f-8bfa598d214b","block_type":"box","text":"All future references to CMOs also include REMICs.","page_number":152,"box":{"x":116,"y":149,"width":392,"height":10}},{"id":"d25886eb-96c7-4903-b771-92ae1d88d5b1","block_type":"box","text":"CMOs are structured into multiple classes, often referred to as a “tranche,” each issued at a specific","page_number":152,"box":{"x":117,"y":180,"width":746,"height":12}},{"id":"179af0b2-f182-4fb5-8c77-a7bfe02e2dab","block_type":"box","text":"adjustable or fixed interest rate, and bearing a different stated maturity date and each must be fully","page_number":152,"box":{"x":116,"y":196,"width":738,"height":12}},{"id":"b2cdf45c-fbfc-4297-b973-f4cfba2e812a","block_type":"box","text":"retired no later than its final distribution date. Actual maturity and average life will depend upon the","page_number":152,"box":{"x":117,"y":211,"width":734,"height":12}},{"id":"a3050466-6972-4b8f-abe9-c0f3a3b725ac","block_type":"box","text":"prepayment experience of the collateral, which is ordinarily unrelated to the stated maturity date.","page_number":152,"box":{"x":117,"y":227,"width":719,"height":12}},{"id":"a67d2c2d-0c8d-49e0-8f58-2338dc62cff3","block_type":"box","text":"CMOs often provide for a modified form of call protection through a de facto breakdown of the","page_number":152,"box":{"x":117,"y":242,"width":700,"height":12}},{"id":"e70552bb-0cc8-4b9d-a32b-5915b3f296fd","block_type":"box","text":"underlying pool of mortgages according to how quickly the loans are repaid. Monthly payment of","page_number":152,"box":{"x":117,"y":258,"width":718,"height":12}},{"id":"c8e5cf24-39c6-449b-bc13-ddc3b6fbf00a","block_type":"box","text":"principal received from the pool of underlying mortgages, including prepayments, is first returned to","page_number":152,"box":{"x":117,"y":273,"width":740,"height":12}},{"id":"142bd672-8203-4450-9b0f-dbc4f2e0b947","block_type":"box","text":"investors holding the shortest maturity class. Investors holding the longer maturity classes usually","page_number":152,"box":{"x":117,"y":289,"width":729,"height":12}},{"id":"e1a7e580-4437-4d11-8e4f-694f4d210d7b","block_type":"box","text":"receive principal only after the first class has been retired. An investor may be partially protected","page_number":152,"box":{"x":117,"y":304,"width":719,"height":12}},{"id":"6af25978-dc60-4633-bae7-34772dc50adb","block_type":"box","text":"against a sooner than desired return of principal because of the sequential payments.","page_number":152,"box":{"x":116,"y":320,"width":640,"height":12}},{"id":"3c42f22f-4ebd-4997-8f84-ca85e248d567","block_type":"box","text":"Certain issuers of CMOs are not considered investment companies pursuant to a rule adopted by the","page_number":152,"box":{"x":117,"y":351,"width":755,"height":12}},{"id":"ce35edc3-7317-4f0f-9a2f-5f6e74e9326c","block_type":"box","text":"Commission, and a Fund may invest in the securities of such issuers without the limitations imposed by","page_number":152,"box":{"x":117,"y":366,"width":771,"height":12}},{"id":"dc559661-79ae-466c-b727-e96657578c12","block_type":"box","text":"the Investment Company Act on investments by a Fund in other investment companies. In addition, in","page_number":152,"box":{"x":116,"y":382,"width":761,"height":12}},{"id":"1285e18f-d772-4645-b9d0-aae1433b38c0","block_type":"box","text":"reliance on an earlier Commission interpretation, a Fund’s investments in certain other qualifying","page_number":152,"box":{"x":117,"y":397,"width":721,"height":12}},{"id":"d214bf3e-82b9-40ad-8cdd-ce8729910ce0","block_type":"box","text":"CMOs, which cannot or do not rely on the rule, are also not subject to the limitation of the Investment","page_number":152,"box":{"x":117,"y":413,"width":753,"height":12}},{"id":"df7ba0bf-cb89-441f-b8bc-54ff581c6977","block_type":"box","text":"Company Act on acquiring interests in other investment companies. In order to be able to rely on the","page_number":152,"box":{"x":117,"y":428,"width":750,"height":12}},{"id":"b2556986-2850-4599-82ed-3b8b743d0e2b","block_type":"box","text":"Commission’s interpretation, these CMOs must be unmanaged, fixed asset issuers, that: (1) invest","page_number":152,"box":{"x":117,"y":444,"width":736,"height":12}},{"id":"dc07bd66-20dc-45bb-a3df-468ea6e5f5b9","block_type":"box","text":"primarily in mortgage-backed securities; (2) do not issue redeemable securities; (3) operate under","page_number":152,"box":{"x":117,"y":459,"width":730,"height":12}},{"id":"6e326d07-faa2-48ff-87f7-06d83711f3cf","block_type":"box","text":"general exemptive orders exempting them from all provisions of the Investment Company Act; and","page_number":152,"box":{"x":116,"y":475,"width":736,"height":12}},{"id":"1115b14c-fbbc-414c-9cb1-a11036fc7a09","block_type":"box","text":"(4) are not registered or regulated under the Investment Company Act as investment companies. To","page_number":152,"box":{"x":117,"y":490,"width":748,"height":12}},{"id":"c23e386e-b878-4a8a-9071-67a1e57d98cf","block_type":"box","text":"the extent that a Fund selects CMOs that cannot rely on the rule or do not meet the above","page_number":152,"box":{"x":116,"y":506,"width":674,"height":12}},{"id":"f8255343-58b0-43bd-b4ba-5c67439a92bb","block_type":"box","text":"requirements, the Fund may not invest more than 10% of its assets in all such entities and may not","page_number":152,"box":{"x":117,"y":521,"width":738,"height":12}},{"id":"968bd37c-3f55-405c-af03-ed1bbd4d1e5e","block_type":"box","text":"acquire more than 3% of the voting securities of any single such entity.","page_number":152,"box":{"x":116,"y":537,"width":530,"height":12}},{"id":"e5cee749-8822-4d0d-9610-ac3b52f94ad2","block_type":"box","text":"A Fund may also invest in, among other things, parallel pay CMOs, sequential pay CMOs, and floating","page_number":152,"box":{"x":116,"y":568,"width":765,"height":12}},{"id":"11a648f9-9a29-45ab-ab66-67c7bfcdf2d2","block_type":"box","text":"rate CMOs. Parallel pay CMOs are structured to provide payments of principal on each payment date","page_number":152,"box":{"x":117,"y":583,"width":757,"height":12}},{"id":"9e9901c0-3a42-4b75-9e9d-82c1c9ddc0af","block_type":"box","text":"to more than one class, concurrently on a proportionate or disproportionate basis. These simultaneous","page_number":152,"box":{"x":116,"y":599,"width":766,"height":12}},{"id":"fb9d1b4d-a953-49a5-ad25-6b5c234085bb","block_type":"box","text":"payments are taken into account in calculating the final distribution date of each class. Sequential pay","page_number":152,"box":{"x":117,"y":614,"width":759,"height":12}},{"id":"4c9ff02b-73b6-4e5b-aaea-554b0ab16762","block_type":"box","text":"CMOs generally pay principal to only one class at a time while paying interest to several classes. A","page_number":152,"box":{"x":117,"y":630,"width":739,"height":12}},{"id":"8a105876-3cb7-4dce-a178-6095b6eecbee","block_type":"box","text":"wide variety of REMIC Certificates may be issued in the parallel pay or sequential pay structures.","page_number":152,"box":{"x":116,"y":645,"width":726,"height":12}},{"id":"a2ea9844-1a06-4e65-9e2f-6b7b136e7d4f","block_type":"box","text":"These securities include accrual certificates (also known as “Z-Bonds”), which only accrue interest at a","page_number":152,"box":{"x":116,"y":661,"width":761,"height":12}},{"id":"59b9bc08-5489-4ff3-a295-76fae765c98b","block_type":"box","text":"specified rate until all other certificates having an earlier final distribution date have been retired and","page_number":152,"box":{"x":116,"y":676,"width":740,"height":12}},{"id":"e7047f52-6e14-4bfd-8c18-096c422ebdb5","block_type":"box","text":"are converted thereafter to an interest-paying security. Floating rate CMOs are securities whose","page_number":152,"box":{"x":116,"y":692,"width":712,"height":12}},{"id":"b38c3eda-af26-424c-aa8a-ee6ef3eb1b21","block_type":"box","text":"coupon rate fluctuates according to some formula related to an existing market index or rate. Typical","page_number":152,"box":{"x":116,"y":707,"width":745,"height":12}},{"id":"397eaaf6-a725-4068-8441-bb6753d20d7b","block_type":"box","text":"indices would include the eleventh district cost-of-funds index (“COFI”), one-year Treasury yields, and","page_number":152,"box":{"x":117,"y":723,"width":753,"height":12}},{"id":"8086b489-b11a-4d40-9a4d-20fab2480064","block_type":"box","text":"ten-year Treasury yields.","page_number":152,"box":{"x":116,"y":738,"width":184,"height":12}},{"id":"627edd56-906e-4da7-afc8-ce431b36448f","block_type":"box","text":"Classes of CMOs also include planned amortization classes (“PACs”) and targeted amortization classes","page_number":152,"box":{"x":117,"y":769,"width":763,"height":12}},{"id":"c2685adb-d797-4baa-a3d3-2d22ad1c7bdb","block_type":"box","text":"(“TACs”). PAC bonds generally require payments of a specified amount of principal on each payment","page_number":152,"box":{"x":117,"y":785,"width":742,"height":12}},{"id":"1d11eed6-c623-4041-b519-9a839effca4b","block_type":"box","text":"date. The scheduled principal payments for PAC Certificates generally have the highest priority on each","page_number":152,"box":{"x":116,"y":800,"width":762,"height":12}},{"id":"ad0ce105-8353-492f-b6fb-7e34070a305f","block_type":"box","text":"payment date after interest due has been paid to all classes entitled to receive interest currently.","page_number":152,"box":{"x":117,"y":816,"width":705,"height":12}},{"id":"bc27dbf9-adad-42de-9922-5fc57205de92","block_type":"box","text":"Shortfalls, if any, are added to the amount payable on the next payment date. The PAC Certificate","page_number":152,"box":{"x":116,"y":831,"width":726,"height":12}},{"id":"7acbb54e-ba8e-4082-955f-5c2ecaec04dd","block_type":"box","text":"payment schedule is taken into account in calculating the final distribution date of each class of PAC. In","page_number":152,"box":{"x":117,"y":847,"width":763,"height":12}},{"id":"1133492d-7d33-4c74-9af5-b9ed044ab45d","block_type":"box","text":"order to create PAC tranches, one or more tranches generally must be created that absorb most of the","page_number":152,"box":{"x":116,"y":862,"width":759,"height":12}},{"id":"0bbb7883-6aea-4f6c-a068-2db7db3b05fd","block_type":"box","text":"II-68","page_number":152,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"867291b9-9fff-4c02-a97c-046fb42a16e6","block_type":"box","text":"NM0926U-5926888-152/257","page_number":152,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"fe72205a-582c-45b6-8645-d7c88614cec9","block_type":"box","text":"volatility in the underlying mortgage assets. These tranches (often called “supports” or “companion”","page_number":153,"box":{"x":116,"y":87,"width":734,"height":12}},{"id":"1fa3dac1-f25d-49a4-b571-0910205672ad","block_type":"box","text":"tranches) tend to have market prices and yields that are more volatile than the PAC classes.","page_number":153,"box":{"x":116,"y":102,"width":683,"height":13}},{"id":"9e7b77b1-861f-4a34-b1aa-9589d6dbf668","block_type":"box","text":"TACs are similar to PACs in that they require that specified amounts of principal be applied on each","page_number":153,"box":{"x":116,"y":131,"width":745,"height":12}},{"id":"9e27d290-4770-42bb-b408-5072bffca8dd","block_type":"box","text":"payment date to one or more classes of REMIC Certificates. A PAC’s payment schedule, however,","page_number":153,"box":{"x":117,"y":146,"width":738,"height":12}},{"id":"34910d71-4b86-42dd-9b79-b28da6c64f0d","block_type":"box","text":"remains in effect as long as prepayment rates on the underlying mortgages do not exceed certain","page_number":153,"box":{"x":117,"y":162,"width":728,"height":12}},{"id":"56569342-7674-4382-a2e7-852238fd9217","block_type":"box","text":"ranges. In contrast, a TAC provides investors with protection, to a certain level, against either faster","page_number":153,"box":{"x":117,"y":177,"width":743,"height":12}},{"id":"be702f98-bb44-4e48-a067-36df0d11d5bd","block_type":"box","text":"than expected or slower than expected prepayment rates, but not both. TACs thus provide more cash","page_number":153,"box":{"x":116,"y":193,"width":759,"height":12}},{"id":"b0737dac-35d1-4b0d-8fe9-31b0c7198244","block_type":"box","text":"flow stability than a regular sequential paying class, but less than a PAC. TACs also tend to have","page_number":153,"box":{"x":116,"y":208,"width":725,"height":12}},{"id":"e7ab8c59-5cd5-4fb6-a792-1506120e4108","block_type":"box","text":"market prices and yields that are more volatile than PACs.","page_number":153,"box":{"x":117,"y":224,"width":437,"height":12}},{"id":"cafca23e-8b16-4630-a4f3-06392b042410","block_type":"box","text":"Adjustable Rate Mortgage Securities.","page_number":153,"box":{"x":115,"y":252,"width":277,"height":12}},{"id":"713587cd-2979-4766-9922-89fb1442b789","block_type":"box","text":"Adjustable rate mortgage securities (“ARMs”) are pass-through","page_number":153,"box":{"x":393,"y":252,"width":479,"height":12}},{"id":"3e46af77-e37f-482e-ad44-5248eb2f1604","block_type":"box","text":"securities collateralized by mortgages with adjustable rather than fixed rates. ARMs eligible for","page_number":153,"box":{"x":116,"y":268,"width":706,"height":12}},{"id":"a9b38d80-164b-49d0-a773-5e11e5a2d872","block_type":"box","text":"inclusion in a mortgage pool generally provide for a fixed initial mortgage interest rate for a set number","page_number":153,"box":{"x":117,"y":283,"width":764,"height":12}},{"id":"aefbe707-2f3f-4e95-853c-e83b23724237","block_type":"box","text":"of scheduled monthly payments. After that schedule of payments has been completed, the interest","page_number":153,"box":{"x":116,"y":299,"width":736,"height":12}},{"id":"2a6dbd9e-42a0-448c-8fed-67748889dda9","block_type":"box","text":"rates are subject to periodic adjustment based on changes to a designated benchmark index.","page_number":153,"box":{"x":117,"y":314,"width":697,"height":12}},{"id":"cdaa6a74-1aec-45f5-8c51-e43981d9d8b5","block_type":"box","text":"ARMs contain maximum and minimum rates beyond which the mortgage interest rate may not vary","page_number":153,"box":{"x":116,"y":343,"width":741,"height":12}},{"id":"8fe5bac5-ad96-4ab4-af69-25f90f3f89e1","block_type":"box","text":"over the lifetime of the security. In addition, certain ARMs provide for additional limitations on the","page_number":153,"box":{"x":116,"y":358,"width":722,"height":12}},{"id":"fd9f89db-0283-4443-bafb-cfc73201e901","block_type":"box","text":"maximum amount by which the mortgage interest rate may adjust for any single adjustment period. In","page_number":153,"box":{"x":117,"y":374,"width":758,"height":12}},{"id":"315ab21d-1d03-41e3-a80f-f5b4e97965cd","block_type":"box","text":"the event that market rates of interest rise more rapidly to levels above that of the ARM’s maximum","page_number":153,"box":{"x":116,"y":389,"width":741,"height":12}},{"id":"fb430347-ada4-48e1-8c07-219a448c6a00","block_type":"box","text":"rate, the ARM’s coupon may represent a below market rate of interest. In these circumstances, the","page_number":153,"box":{"x":117,"y":405,"width":737,"height":12}},{"id":"2107f493-9aaf-47a9-b87f-f4c5105d4a84","block_type":"box","text":"market value of the ARM security will likely have fallen.","page_number":153,"box":{"x":117,"y":420,"width":412,"height":12}},{"id":"509b89f6-6cfa-4367-b7e0-4cbe508d51fd","block_type":"box","text":"Certain ARMs contain limitations on changes in the required monthly payment. In the event that a","page_number":153,"box":{"x":117,"y":448,"width":728,"height":13}},{"id":"d8c5e519-4f15-46aa-93f1-192aef08a8d6","block_type":"box","text":"monthly payment is not sufficient to pay the interest accruing on an ARM, any such excess interest is","page_number":153,"box":{"x":117,"y":464,"width":754,"height":12}},{"id":"ba1bbbdd-029a-447e-a97f-0a175cc34af5","block_type":"box","text":"added to the principal balance of the mortgage loan, which is repaid through future monthly payments.","page_number":153,"box":{"x":116,"y":480,"width":764,"height":12}},{"id":"b48b0b33-80a9-42db-91a7-9d57e2319a78","block_type":"box","text":"If the monthly payment for such an instrument exceeds the sum of the interest accrued at the","page_number":153,"box":{"x":117,"y":495,"width":695,"height":12}},{"id":"0aa6b58a-200b-4acb-9548-682742652147","block_type":"box","text":"applicable mortgage interest rate and the principal payment required at such point to amortize the","page_number":153,"box":{"x":116,"y":511,"width":730,"height":12}},{"id":"4d91505e-8c23-4075-9240-06d879ff9c4c","block_type":"box","text":"outstanding principal balance over the remaining term of the loan, the excess is then used to reduce","page_number":153,"box":{"x":116,"y":526,"width":748,"height":12}},{"id":"73f51d30-e0cd-47b2-8f84-fb293fae8512","block_type":"box","text":"the outstanding principal balance of the ARM.","page_number":153,"box":{"x":116,"y":542,"width":344,"height":12}},{"id":"dccb820a-b0a8-4923-af30-323fb569e265","block_type":"box","text":"CMO Residuals.","page_number":153,"box":{"x":117,"y":570,"width":120,"height":9}},{"id":"2fa76dc5-306f-4356-a0da-966625b8d8cc","block_type":"box","text":"CMO residuals are derivative mortgage securities issued by agencies or","page_number":153,"box":{"x":238,"y":570,"width":546,"height":12}},{"id":"3383a903-5bc4-4a9c-aa32-68a8c3d30bc1","block_type":"box","text":"instrumentalities of the U.S. Government or by private originators of, or investors in, mortgage loans,","page_number":153,"box":{"x":117,"y":585,"width":750,"height":12}},{"id":"976cb783-74ee-41d0-874e-6f4f7ed2b780","block_type":"box","text":"including savings and loan associations, homebuilders, mortgage banks, commercial banks,","page_number":153,"box":{"x":117,"y":601,"width":688,"height":12}},{"id":"d7d0992b-de96-4383-b3b4-d3b761e7cacc","block_type":"box","text":"investment banks, and special purpose entities of the foregoing. The cash flow generated by the","page_number":153,"box":{"x":117,"y":616,"width":718,"height":12}},{"id":"bdd56673-7e94-4bd7-9de0-771921c2d7cb","block_type":"box","text":"mortgage assets underlying a series of CMOs is applied first to make required payments of principal","page_number":153,"box":{"x":117,"y":632,"width":747,"height":12}},{"id":"09a9cf74-8140-420d-aa94-56519818097f","block_type":"box","text":"and interest on the CMOs and second to pay the related administrative expenses and any","page_number":153,"box":{"x":116,"y":647,"width":673,"height":13}},{"id":"9fa6bbad-08d3-4aa2-9a49-226802036c63","block_type":"box","text":"management fees of the issuer. The residual in a CMO structure generally represents the interest in","page_number":153,"box":{"x":117,"y":663,"width":740,"height":12}},{"id":"b3945fa5-5db6-45fe-af34-6191f3cfefc6","block_type":"box","text":"any excess cash flow remaining after making the foregoing payments. Each payment of such excess","page_number":153,"box":{"x":116,"y":678,"width":748,"height":13}},{"id":"82f9c598-1e77-48ce-bb7b-4e63b6fcc097","block_type":"box","text":"cash flow to a holder of the related CMO residual represents income and/or a return of capital. The","page_number":153,"box":{"x":116,"y":694,"width":733,"height":12}},{"id":"7e7fc2e3-779c-4493-8e8a-57efb207602b","block_type":"box","text":"amount of residual cash flow resulting from a CMO will depend on, among other things, the","page_number":153,"box":{"x":116,"y":709,"width":676,"height":13}},{"id":"4fd84a48-5e66-4278-b5e5-cb0a0ce0acbb","block_type":"box","text":"characteristics of the mortgage assets, the coupon rate of each class of CMO, prevailing interest rates,","page_number":153,"box":{"x":116,"y":725,"width":762,"height":12}},{"id":"5c8fd0a8-c267-4c07-9c3a-5e1b2885ede7","block_type":"box","text":"the amount of administrative expenses and the prepayment experience on the mortgage assets. In","page_number":153,"box":{"x":116,"y":740,"width":732,"height":13}},{"id":"dfce7b65-1ec6-41c8-9f90-7aaad5a6bc80","block_type":"box","text":"part, the yield to maturity on the CMO residuals is extremely sensitive to prepayments on the related","page_number":153,"box":{"x":117,"y":756,"width":743,"height":12}},{"id":"557d6b8e-cc39-4c92-a1ca-71e8e8790c9a","block_type":"box","text":"underlying mortgage assets, in the same manner as an interest-only class of stripped mortgage-related","page_number":153,"box":{"x":117,"y":771,"width":764,"height":13}},{"id":"4881ac11-a14a-4809-a883-84c6adbea404","block_type":"box","text":"securities. In addition, if a series of a CMO includes a class that bears interest at an adjustable rate,","page_number":153,"box":{"x":116,"y":787,"width":739,"height":12}},{"id":"8d2c89c6-5d6f-4ca3-a8ab-0af5f74b89c7","block_type":"box","text":"the yield to maturity on the related CMO residual will also be extremely sensitive to changes in the","page_number":153,"box":{"x":116,"y":802,"width":728,"height":13}},{"id":"5f1efce7-6199-4f48-98a8-53c3e0c2ca11","block_type":"box","text":"level of the index upon which interest rate adjustments are based. In certain circumstances, a Fund","page_number":153,"box":{"x":117,"y":818,"width":735,"height":12}},{"id":"fa9add77-02e8-42bd-b4f6-08077af86e68","block_type":"box","text":"may fail to recoup fully its initial investment in a CMO residual.","page_number":153,"box":{"x":117,"y":833,"width":466,"height":13}},{"id":"fd2a457e-4c49-451f-8659-bcb97beb4001","block_type":"box","text":"CMO residuals are generally purchased and sold by institutional investors through one or more","page_number":153,"box":{"x":117,"y":862,"width":709,"height":12}},{"id":"99bd3c18-4a11-4304-94f5-5bec7a1b07b6","block_type":"box","text":"investment banking firms acting as brokers or dealers. Transactions in CMO residuals are generally","page_number":153,"box":{"x":117,"y":877,"width":744,"height":12}},{"id":"765da311-fdae-4a69-a0fb-3c78be68bb35","block_type":"box","text":"II-69","page_number":153,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"fea94f36-46b0-446f-8ee1-971c19cfc0c5","block_type":"box","text":"NM0926U-5926888-153/257","page_number":153,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"38ce5c8f-92a3-41cf-9edf-468495d3063f","block_type":"box","text":"completed only after careful review of the characteristics of the securities in question. In addition, CMO","page_number":154,"box":{"x":116,"y":87,"width":768,"height":12}},{"id":"61d326f8-4b0d-4ed0-8770-4c7925d72be0","block_type":"box","text":"residuals may or, pursuant to an exemption therefrom, may not have been registered under the","page_number":154,"box":{"x":117,"y":102,"width":711,"height":13}},{"id":"be96511e-106d-473f-b8d2-0f3fa4e509b6","block_type":"box","text":"Securities Act. Residual interests generally are junior to, and may be significantly more volatile than,","page_number":154,"box":{"x":116,"y":118,"width":748,"height":12}},{"id":"e08a4461-0183-4393-83cd-ce7cf9203ea3","block_type":"box","text":"“regular” CMO and REMIC interests. CMO residuals, whether or not registered under the Securities","page_number":154,"box":{"x":116,"y":134,"width":744,"height":12}},{"id":"430f2a18-4609-42d6-9b40-314172261c48","block_type":"box","text":"Act, may be subject to certain restrictions on transferability.","page_number":154,"box":{"x":116,"y":149,"width":444,"height":12}},{"id":"787d73e9-2908-47e5-8453-db0cb7cb738c","block_type":"box","text":"Stripped Mortgage-Backed Securities.","page_number":154,"box":{"x":117,"y":180,"width":280,"height":12}},{"id":"0233b6bf-3b2b-472b-9bbf-5cf087598b42","block_type":"box","text":"A Fund may invest in stripped mortgage-backed securities","page_number":154,"box":{"x":399,"y":180,"width":443,"height":12}},{"id":"bd96259a-d6b1-40ff-96a7-1031b8ee78b6","block_type":"box","text":"(“SMBSs”) issued by agencies or instrumentalities of the United States. SMBSs are derivative multi","page_number":154,"box":{"x":117,"y":196,"width":740,"height":12}},{"id":"d937c598-1015-44de-ad53-9072ae64bc2c","block_type":"box","text":"class mortgage-backed securities. SMBS arrangements commonly involve two classes of securities","page_number":154,"box":{"x":116,"y":211,"width":744,"height":12}},{"id":"5ef7a7b1-cff5-4470-8b6e-04aaa912f3ab","block_type":"box","text":"that receive different proportions of the interest and principal distributions on a pool of mortgage","page_number":154,"box":{"x":116,"y":227,"width":716,"height":12}},{"id":"fa7f7bf1-8719-43be-9f5d-827a0c76165c","block_type":"box","text":"assets. A common variety of SMBS is where one class (the principal only or PO class) receives some","page_number":154,"box":{"x":116,"y":242,"width":759,"height":12}},{"id":"499bccda-17db-4bca-aebb-8eded5023002","block_type":"box","text":"of the interest and most of the principal from the underlying assets, while the other class (the interest","page_number":154,"box":{"x":116,"y":258,"width":752,"height":12}},{"id":"c6727ebf-0473-4595-a04e-5b903e46d333","block_type":"box","text":"only or IO class) receives most of the interest and the remainder of the principal. In the most extreme","page_number":154,"box":{"x":116,"y":273,"width":755,"height":12}},{"id":"6773e4d5-ae73-4ed7-9849-0e3511e32f6a","block_type":"box","text":"case, the IO class receives all of the interest, while","page_number":154,"box":{"x":116,"y":289,"width":382,"height":11}},{"id":"2d7f70b4-4d25-46a7-9459-1e0d01d60aac","block_type":"box","text":"the PO class receives all of the principal. While a","page_number":154,"box":{"x":498,"y":289,"width":368,"height":12}},{"id":"6c393ce8-2d4e-4318-b219-8d5adacad982","block_type":"box","text":"Fund may purchase securities of a PO class, a Fund is more likely to purchase the securities of an IO","page_number":154,"box":{"x":117,"y":304,"width":758,"height":12}},{"id":"7b322bed-174f-4ff3-a175-7b6549da52d3","block_type":"box","text":"class. The yield to maturity of an IO class is extremely sensitive to the rate of principal payments","page_number":154,"box":{"x":116,"y":320,"width":720,"height":12}},{"id":"f5122216-d5a7-4d9a-9823-972e85d84149","block_type":"box","text":"(including prepayments) on the related underlying assets, and a rapid rate of principal prepayments in","page_number":154,"box":{"x":117,"y":335,"width":759,"height":12}},{"id":"c9a01eef-5b47-47c6-a440-dee579c0026a","block_type":"box","text":"excess of that considered in pricing the securities will have a material adverse effect on an IO","page_number":154,"box":{"x":116,"y":351,"width":699,"height":12}},{"id":"e19b71ed-c34b-41f6-b06b-1e64b9793c36","block_type":"box","text":"security’s yield to maturity. If the underlying mortgage assets experience greater than anticipated","page_number":154,"box":{"x":116,"y":366,"width":724,"height":12}},{"id":"37f39413-e11f-4082-9dc0-7dae31eec209","block_type":"box","text":"payments of principal, a Fund may fail to recoup fully its initial investment in IOs. In addition, there are","page_number":154,"box":{"x":117,"y":382,"width":760,"height":12}},{"id":"8cefb2b1-8486-4b2d-9bab-181ba9f3de3d","block_type":"box","text":"certain types of IOs that represent the interest portion of a particular class as opposed to the interest","page_number":154,"box":{"x":116,"y":397,"width":751,"height":12}},{"id":"269893e9-35a6-4d8d-8711-ad06a26ed18b","block_type":"box","text":"portion of the entire pool. The sensitivity of this type of IO to interest rate fluctuations may be increased","page_number":154,"box":{"x":117,"y":413,"width":768,"height":12}},{"id":"f610b0f6-34e5-4ee4-80e6-9e752d113a5f","block_type":"box","text":"because of the characteristics of the principal portion to which they relate. As a result of the above","page_number":154,"box":{"x":117,"y":428,"width":733,"height":12}},{"id":"e8cf0c39-2c2b-49ea-929a-5d9b4aa1f6fe","block_type":"box","text":"factors, a Fund generally will purchase IOs only as a component of so called “synthetic” securities. This","page_number":154,"box":{"x":116,"y":444,"width":772,"height":12}},{"id":"32f195ce-7360-4d70-a004-f301ecbc8eed","block_type":"box","text":"means that purchases of IOs will be matched with certain purchases of other securities, such as POs,","page_number":154,"box":{"x":117,"y":459,"width":759,"height":12}},{"id":"b83d809c-4abf-4747-b52e-7f7a7df72032","block_type":"box","text":"inverse floating rate CMOs or fixed rate securities; as interest rates fall, presenting a greater risk of","page_number":154,"box":{"x":117,"y":475,"width":737,"height":12}},{"id":"76d4b83e-4b3c-4d63-82ba-98cd77d18d19","block_type":"box","text":"unanticipated prepayments of principal, the negative effect on a Fund because of its holdings of IOs","page_number":154,"box":{"x":117,"y":490,"width":744,"height":12}},{"id":"7481f518-19a5-4185-a801-e8bf79ea671d","block_type":"box","text":"should be diminished somewhat because of the increased yield on the inverse floating rate CMOs or","page_number":154,"box":{"x":116,"y":506,"width":751,"height":12}},{"id":"fcf83786-046f-47af-b724-959d74f939ca","block_type":"box","text":"the increased appreciation on the POs or fixed rate securities.","page_number":154,"box":{"x":116,"y":521,"width":465,"height":12}},{"id":"e78f7a7b-04f7-42a7-a1ad-c8a43e83bbf2","block_type":"box","text":"Tiered Index Bonds.","page_number":154,"box":{"x":118,"y":552,"width":147,"height":10}},{"id":"acb85d5b-c779-40e3-9fdf-7b2adbf88226","block_type":"box","text":"Tiered index bonds are forms of mortgage-related securities. The interest rate on","page_number":154,"box":{"x":266,"y":552,"width":612,"height":12}},{"id":"319e1cda-6144-426b-95d2-a336cbb53ef3","block_type":"box","text":"a tiered index bond is tied to a specified index or","page_number":154,"box":{"x":116,"y":568,"width":365,"height":12}},{"id":"2dba930b-e249-4086-bb6b-daf0e5cc991e","block_type":"box","text":"market rate. So long as this index or market rate is","page_number":154,"box":{"x":482,"y":568,"width":380,"height":12}},{"id":"b6bee6b3-77d7-46c0-8612-41014b8b1919","block_type":"box","text":"below a predetermined “strike” rate, the interest rate on the tiered index bond remains fixed. If,","page_number":154,"box":{"x":117,"y":583,"width":704,"height":12}},{"id":"4d88d38b-cfde-4c82-9e9a-56b0b4263641","block_type":"box","text":"however, the specified index or market rate rises above the “strike” rate, the interest rate of the tiered","page_number":154,"box":{"x":117,"y":599,"width":754,"height":12}},{"id":"2f4a7f33-243c-4112-8ec9-84659f42e00f","block_type":"box","text":"index bond will decrease. Thus, under these circumstances, the interest rate on a tiered index bond,","page_number":154,"box":{"x":117,"y":614,"width":747,"height":11}},{"id":"17c263ea-f9a2-4102-ab73-0de7dab48162","block_type":"box","text":"like an inverse floater, will move in the opposite direction of prevailing interest rates, with the result that","page_number":154,"box":{"x":117,"y":630,"width":767,"height":12}},{"id":"4f98e9ea-2ebe-440b-a88e-18baef98acbc","block_type":"box","text":"the price of the tiered index bond may be considerably more volatile than that of a fixed-rate bond.","page_number":154,"box":{"x":116,"y":645,"width":733,"height":12}},{"id":"0b3b8226-4fd8-4535-b426-dd9690c2ef7c","block_type":"box","text":"TBA Commitments.","page_number":154,"box":{"x":118,"y":676,"width":142,"height":10}},{"id":"b1058862-613e-47d5-8c48-52cd0391173f","block_type":"box","text":"Certain Funds may enter into “to be announced” or “TBA” commitments. TBA","page_number":154,"box":{"x":267,"y":676,"width":573,"height":12}},{"id":"a393d59f-508f-4242-9491-d3fcd6e2c7c4","block_type":"box","text":"commitments are forward agreements for the purchase or sale of securities, including mortgage","page_number":154,"box":{"x":116,"y":692,"width":716,"height":12}},{"id":"58ebf5c9-703d-48ae-9f70-ffa8136d66de","block_type":"box","text":"backed securities for a fixed price, with payment and delivery on an agreed upon future settlement","page_number":154,"box":{"x":117,"y":707,"width":728,"height":12}},{"id":"22e224cd-df66-4ebf-a3c0-173f3cdd5e61","block_type":"box","text":"date. The specific securities to be delivered are not identified at the trade date. However, delivered","page_number":154,"box":{"x":116,"y":723,"width":731,"height":12}},{"id":"655b15ac-0570-463e-96fa-efca6cf010af","block_type":"box","text":"securities must meet specified terms, including issuer, rate and mortgage terms. When the Fund enters","page_number":154,"box":{"x":116,"y":738,"width":767,"height":12}},{"id":"be564ccd-7f29-45a7-95da-eb07addd01ab","block_type":"box","text":"into a TBA commitment for the sale of mortgage-backed securities for a fixed price, with payment and","page_number":154,"box":{"x":117,"y":754,"width":752,"height":12}},{"id":"c3adb036-fffa-4c13-a66b-fac22e5b6434","block_type":"box","text":"delivery on an agreed upon future settlement date (which may be referred to as having a short position","page_number":154,"box":{"x":116,"y":769,"width":761,"height":12}},{"id":"28668767-a883-4736-bfe5-bc6601b9ea53","block_type":"box","text":"in such TBA securities), the Fund may or may not hold the types of mortgage-backed securities","page_number":154,"box":{"x":117,"y":785,"width":707,"height":12}},{"id":"ae4bf9f9-2132-452c-bc61-9ed4884b7c7d","block_type":"box","text":"required to be delivered. See “— When-Issued Securities, Delayed Delivery Securities and Forward","page_number":154,"box":{"x":117,"y":800,"width":737,"height":12}},{"id":"e9705a1f-4d40-4da0-87d0-051dd8f779d6","block_type":"box","text":"Commitments” below.","page_number":154,"box":{"x":117,"y":816,"width":160,"height":9}},{"id":"e0a7788b-3593-4775-a2ff-cd8a86c8960e","block_type":"box","text":"Mortgage Dollar Rolls.","page_number":154,"box":{"x":116,"y":847,"width":164,"height":12}},{"id":"f062ebf8-3fa7-424d-8033-81f924edeb18","block_type":"box","text":"Certain Funds may invest in mortgage dollar rolls. In a mortgage dollar roll","page_number":154,"box":{"x":282,"y":847,"width":562,"height":12}},{"id":"28e932e9-c5ce-45f5-88e2-defebb4a473c","block_type":"box","text":"transaction, a Fund sells mortgage-backed securities for delivery in the current month and","page_number":154,"box":{"x":116,"y":862,"width":673,"height":12}},{"id":"4b5968fe-9e98-403e-babb-8b1de9072e9b","block_type":"box","text":"simultaneously contracts to repurchase substantially similar securities on a specified future date. The","page_number":154,"box":{"x":116,"y":878,"width":755,"height":12}},{"id":"38b2720e-3fee-4d74-ba1a-db170a1fffd3","block_type":"box","text":"II-70","page_number":154,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"2679611b-e86a-42a5-9d69-269b8de2ae39","block_type":"box","text":"NM0926U-5926888-154/257","page_number":154,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"356c1b27-cb90-4f4a-963e-58e487f8ed56","block_type":"box","text":"securities that are repurchased will bear the same interest rate and a similar maturity as those sold, but","page_number":155,"box":{"x":116,"y":87,"width":771,"height":12}},{"id":"3385138b-89c8-4a32-9001-3ab9f388c54d","block_type":"box","text":"pools of mortgages collateralizing those securities may have different prepayment histories than those","page_number":155,"box":{"x":117,"y":102,"width":762,"height":13}},{"id":"c0f58762-f90c-466b-b389-d6ccdc1f84ea","block_type":"box","text":"sold. During the period between the sale and repurchase, a Fund will not be entitled to receive interest","page_number":155,"box":{"x":116,"y":118,"width":765,"height":12}},{"id":"949d5fb5-f888-410d-9f36-342fda79f53b","block_type":"box","text":"and principal payments on the securities sold. Proceeds of the sale will be invested in additional","page_number":155,"box":{"x":116,"y":134,"width":716,"height":12}},{"id":"a2b2510d-e8ec-4341-909e-7334ce6b6b2c","block_type":"box","text":"instruments for the Fund, and the income from these investments will generate income for the Fund. If","page_number":155,"box":{"x":117,"y":149,"width":762,"height":12}},{"id":"c82c3d88-d5b6-465f-ae42-4176a38fed0f","block_type":"box","text":"such income does not exceed the income, capital appreciation and gain or loss that would have been","page_number":155,"box":{"x":116,"y":165,"width":757,"height":12}},{"id":"c7da4b40-721e-48ba-9b6e-1607efaa2574","block_type":"box","text":"realized on the securities sold as part of the dollar roll, the use of this technique will diminish the","page_number":155,"box":{"x":117,"y":180,"width":715,"height":12}},{"id":"8a3c4ed6-e04a-4ce9-bf37-37a10c8d5eec","block_type":"box","text":"investment performance of a Fund compared with what the performance would have been without the","page_number":155,"box":{"x":117,"y":196,"width":759,"height":11}},{"id":"8528e7a4-6cd3-4ee0-8f20-322d7d063921","block_type":"box","text":"use of dollar rolls.","page_number":155,"box":{"x":117,"y":211,"width":135,"height":10}},{"id":"dac4b823-16f2-4bab-95e3-f84310918a78","block_type":"box","text":"Each mortgage dollar roll transaction is accounted for as a sale or purchase of a portfolio security and","page_number":155,"box":{"x":117,"y":242,"width":760,"height":12}},{"id":"0871ff59-9d42-478d-95f7-aa954db13566","block_type":"box","text":"a subsequent purchase or sale of a substantially similar security in the forward market. Transactions in","page_number":155,"box":{"x":116,"y":258,"width":767,"height":12}},{"id":"3203fe0d-583e-4127-aaa2-1f448499a073","block_type":"box","text":"mortgage dollar rolls may increase trading costs and portfolio turnover.","page_number":155,"box":{"x":117,"y":273,"width":529,"height":12}},{"id":"390e5d69-91dd-4e0a-9f95-3a419235824c","block_type":"box","text":"In the event the buyer of the securities under a mortgage dollar roll files for bankruptcy or becomes","page_number":155,"box":{"x":117,"y":304,"width":738,"height":12}},{"id":"a673a261-99d9-4244-b517-aad8142eadb5","block_type":"box","text":"insolvent, a Fund’s use of the proceeds of the current sale portion of the transaction may be restricted","page_number":155,"box":{"x":117,"y":320,"width":760,"height":12}},{"id":"23b6bd76-f0ce-46f0-9b81-919bd914ef07","block_type":"box","text":"pending a determination by the other party, or its trustee or receiver, whether to enforce the Fund’s","page_number":155,"box":{"x":117,"y":335,"width":738,"height":12}},{"id":"7691cae5-9d56-4c2c-80f0-82d102e3aab7","block_type":"box","text":"obligation to purchase the similar securities in the forward transaction.","page_number":155,"box":{"x":116,"y":351,"width":525,"height":12}},{"id":"e4772c60-c99b-490a-b5b8-a5dd90dc8624","block_type":"box","text":"A Fund may engage in dollar roll transactions to enhance returns. Successful use of mortgage dollar","page_number":155,"box":{"x":116,"y":382,"width":750,"height":12}},{"id":"60ad5638-b964-41a1-a351-895e17f21116","block_type":"box","text":"rolls may depend upon the Manager’s ability to correctly predict interest rates and prepayments. Dollar","page_number":155,"box":{"x":117,"y":397,"width":765,"height":12}},{"id":"0bd21d01-39bd-48ac-a41a-ea547e9cf4a7","block_type":"box","text":"rolls involve the risk that the market value of the securities subject to a Fund’s forward purchase","page_number":155,"box":{"x":117,"y":413,"width":716,"height":12}},{"id":"cb8301c7-f1c4-4d44-8c36-2ab163cf639d","block_type":"box","text":"commitment may decline below, or the market value of the securities subject to a Fund’s forward sale","page_number":155,"box":{"x":116,"y":428,"width":758,"height":12}},{"id":"4e59f1f0-fd24-439c-94af-3d7aec322347","block_type":"box","text":"commitment may increase above, the exercise price of the forward commitment. Dollar rolls are","page_number":155,"box":{"x":116,"y":444,"width":715,"height":12}},{"id":"e21388e8-de73-41e6-82d5-26a5afa2ab3c","block_type":"box","text":"speculative techniques that can be deemed to involve leverage. There is no assurance that dollar rolls","page_number":155,"box":{"x":116,"y":459,"width":763,"height":12}},{"id":"2adb34a5-074d-4bc3-b939-535e0b9ffe7d","block_type":"box","text":"can be successfully employed.","page_number":155,"box":{"x":116,"y":475,"width":233,"height":12}},{"id":"7e615718-c745-43b0-899e-0f849a6681c8","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into when-issued or forward","page_number":155,"box":{"x":117,"y":506,"width":740,"height":12}},{"id":"4475d2fe-2d25-45c6-abde-8d243af027e3","block_type":"box","text":"settling securities (e.g., dollar rolls and firm and standby commitments, including TBA commitments)","page_number":155,"box":{"x":116,"y":521,"width":748,"height":12}},{"id":"a4c0020e-7d55-421c-9bf2-e8f8793eebfa","block_type":"box","text":"and non-standard settlement cycle securities notwithstanding the limitation on the issuance of senior","page_number":155,"box":{"x":116,"y":537,"width":750,"height":12}},{"id":"354402ff-726d-4b34-a15c-73a3df8b1792","block_type":"box","text":"securities in Section 18 of the Investment Company Act, provided that the transaction meets the","page_number":155,"box":{"x":116,"y":552,"width":718,"height":12}},{"id":"e886b97c-2c1d-4ff5-ac8f-99219bed9905","block_type":"box","text":"Delayed-Settlement Securities Provision (as defined below under “— When-Issued Securities, Delayed","page_number":155,"box":{"x":117,"y":568,"width":768,"height":12}},{"id":"57c67bb7-17d7-4120-9060-ba7d0a517f4e","block_type":"box","text":"Delivery Securities and Forward Commitments”). If a when-issued, forward-settling or non-standard","page_number":155,"box":{"x":117,"y":583,"width":742,"height":12}},{"id":"509f7804-ae49-4a3c-a17d-5886146ed50a","block_type":"box","text":"settlement cycle security does not satisfy the Delayed-Settlement Securities Provision, then it is treated","page_number":155,"box":{"x":116,"y":599,"width":772,"height":12}},{"id":"52ace3f9-46ea-407b-8a09-e9066c373ff4","block_type":"box","text":"as a Derivatives Transaction under Rule 18f-4. See “— Derivatives — Regulation of Derivatives —","page_number":155,"box":{"x":116,"y":614,"width":736,"height":12}},{"id":"90d2f105-3869-4449-9ed6-bed7952622a9","block_type":"box","text":"Rule 18f-4 under the Investment Company Act” above.","page_number":155,"box":{"x":117,"y":630,"width":411,"height":12}},{"id":"233b9e89-bb2f-41c3-9615-7f770ea0e907","block_type":"box","text":"Net Interest Margin (NIM) Securities.","page_number":155,"box":{"x":117,"y":661,"width":270,"height":12}},{"id":"5e461e46-3009-4abe-af01-8897d59af4b9","block_type":"box","text":"A Fund may invest in net interest margin (“NIM”) securities.","page_number":155,"box":{"x":394,"y":661,"width":438,"height":12}},{"id":"e2639d68-06cb-42dc-ac20-f0d62ba55e70","block_type":"box","text":"These securities are derivative interest-only mortgage securities structured off home equity loan","page_number":155,"box":{"x":116,"y":676,"width":711,"height":12}},{"id":"62c84812-a7ce-4dab-8acd-0011c5d00191","block_type":"box","text":"transactions. NIM securities receive any “excess” interest computed after paying coupon costs,","page_number":155,"box":{"x":116,"y":692,"width":704,"height":12}},{"id":"921fa08a-fb97-4bb5-bf5b-f5e8d799283b","block_type":"box","text":"servicing costs and fees and any credit losses associated with the underlying pool of home equity","page_number":155,"box":{"x":116,"y":707,"width":724,"height":12}},{"id":"21320d24-41c7-4319-86f0-c792fabd8c19","block_type":"box","text":"loans. Like traditional stripped mortgage-backed securities, the yield to maturity on a NIM security is","page_number":155,"box":{"x":117,"y":723,"width":740,"height":12}},{"id":"38c1cea5-ed45-495a-8bef-5db3c8cef21b","block_type":"box","text":"sensitive not only to changes in prevailing interest rates but also to the rate of principal payments","page_number":155,"box":{"x":116,"y":738,"width":720,"height":12}},{"id":"a06cb248-0a24-489d-9378-1f858221ba45","block_type":"box","text":"(including prepayments) on the underlying home equity loans. NIM securities are highly sensitive to","page_number":155,"box":{"x":117,"y":754,"width":735,"height":12}},{"id":"5fa1a2b2-2206-4d99-93a6-0f9df07def1a","block_type":"box","text":"credit losses on the underlying collateral and the timing in which those losses are taken.","page_number":155,"box":{"x":116,"y":769,"width":651,"height":12}},{"id":"ebf430db-2610-4870-bfa9-355361d9c96c","block_type":"box","text":"Municipal Investments.","page_number":155,"box":{"x":116,"y":800,"width":177,"height":12}},{"id":"a48ba36a-8c28-476a-adef-d32468ea99ec","block_type":"box","text":"Certain Funds may invest in obligations issued by or on behalf of states, territories and possessions of","page_number":155,"box":{"x":117,"y":823,"width":759,"height":13}},{"id":"00394e60-b677-4b8a-b83d-391612963471","block_type":"box","text":"the United States and the District of Columbia and their political subdivisions, agencies and","page_number":155,"box":{"x":116,"y":839,"width":681,"height":12}},{"id":"4f1eb58e-b456-4f7e-a1c2-d73d7855a6d9","block_type":"box","text":"instrumentalities, the payments from which, in the opinion of bond counsel to the issuer, are excludable","page_number":155,"box":{"x":117,"y":854,"width":770,"height":13}},{"id":"24201f56-4bc0-43dc-bd90-08878ce953be","block_type":"box","text":"from gross income for U.S. federal income tax purposes (“Municipal Bonds”). Certain of the Municipal","page_number":155,"box":{"x":116,"y":870,"width":758,"height":12}},{"id":"584220a3-c4fe-48a2-b04c-17214e237550","block_type":"box","text":"II-71","page_number":155,"box":{"x":484,"y":909,"width":29,"height":9}},{"id":"e2bb3716-3721-4776-ad62-2ed673fb74a6","block_type":"box","text":"NM0926U-5926888-155/257","page_number":155,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"32cc332d-c691-4022-bf01-430abe83f3ab","block_type":"box","text":"Funds may also invest in Municipal Bonds that pay interest excludable from gross income for purposes","page_number":156,"box":{"x":117,"y":87,"width":768,"height":12}},{"id":"7ddf23a0-ce94-48dc-9d00-b4713f929467","block_type":"box","text":"of state and local income taxes of the designated state and/or allow the value of a Fund’s shares to be","page_number":156,"box":{"x":116,"y":102,"width":764,"height":13}},{"id":"5414486d-caa3-4440-a2dc-6080e0dd5ca1","block_type":"box","text":"exempt from state and local taxes of the designated state (“State Municipal Bonds”). The Municipal","page_number":156,"box":{"x":116,"y":118,"width":740,"height":12}},{"id":"b4ed7978-dcb4-4c14-9791-19d8cdbad70f","block_type":"box","text":"Funds may also invest in securities not issued by or on behalf of a state or territory or by an agency or","page_number":156,"box":{"x":117,"y":134,"width":762,"height":12}},{"id":"6de3aec1-49df-4aa3-8ba9-cba62298ff9b","block_type":"box","text":"instrumentality thereof, if the Manager believes such securities to pay interest excludable from gross","page_number":156,"box":{"x":117,"y":149,"width":748,"height":12}},{"id":"d5e449f4-15f6-4373-a62b-77cf3b372bff","block_type":"box","text":"income for purposes of U.S. federal income tax and state and local income taxes of the designated","page_number":156,"box":{"x":117,"y":165,"width":738,"height":12}},{"id":"2823be29-8705-4c93-909b-4e2c4c743cba","block_type":"box","text":"state and/or state and local personal property taxes of the designated state (“Non-Municipal","page_number":156,"box":{"x":116,"y":180,"width":686,"height":12}},{"id":"6c335ed8-3a1a-4e7b-87af-6935cacb0474","block_type":"box","text":"Tax-Exempt Securities”). Non-Municipal Tax-Exempt Securities could include trust certificates or other","page_number":156,"box":{"x":116,"y":196,"width":764,"height":12}},{"id":"a77025f6-62ee-455d-bb77-e22e7615fd2f","block_type":"box","text":"instruments evidencing interest in one or more long-term municipal securities. Non-Municipal","page_number":156,"box":{"x":117,"y":211,"width":693,"height":12}},{"id":"c05da495-2c96-436a-883c-24624ae3054a","block_type":"box","text":"Tax-Exempt Securities also may include securities issued by other investment companies that invest in","page_number":156,"box":{"x":116,"y":227,"width":770,"height":12}},{"id":"3f366bba-f42e-4f8f-8f33-a3b8f5d215a1","block_type":"box","text":"municipal bonds, to the extent such investments are permitted by applicable law. Non-Municipal","page_number":156,"box":{"x":117,"y":242,"width":715,"height":12}},{"id":"1f0036ca-2052-4485-8890-906564238c1d","block_type":"box","text":"Tax-Exempt Securities that pay interest excludable from gross income for U.S. federal income tax","page_number":156,"box":{"x":116,"y":258,"width":731,"height":12}},{"id":"dfc50fc2-5c50-4216-8522-3320f231ec87","block_type":"box","text":"purposes will be considered “Municipal Bonds” for purposes of a Municipal Fund’s investment objective","page_number":156,"box":{"x":117,"y":273,"width":769,"height":12}},{"id":"133de663-ef84-445c-92a9-13556898dbc4","block_type":"box","text":"and policies. Non-Municipal Tax-Exempt Securities that pay interest excludable from gross income for","page_number":156,"box":{"x":116,"y":289,"width":761,"height":12}},{"id":"ffa70391-cf59-4718-8c0e-2a73bc31c3f3","block_type":"box","text":"purposes of U.S. federal income tax and state and local income taxes of a designated state and/or","page_number":156,"box":{"x":117,"y":304,"width":734,"height":12}},{"id":"b72d892a-da6b-4228-90ef-62867608cba8","block_type":"box","text":"allow the value of a Fund’s shares to be exempt from state and local personal property taxes of that","page_number":156,"box":{"x":116,"y":320,"width":745,"height":12}},{"id":"24c16e50-d937-4494-b3da-7d0540c16601","block_type":"box","text":"state will be considered “State Municipal Bonds” for purposes of the investment objective and policies","page_number":156,"box":{"x":116,"y":335,"width":758,"height":12}},{"id":"ff69f518-8928-4b87-8173-6ba95b406fc7","block_type":"box","text":"of each of California Municipal Opportunities Fund, New Jersey Municipal Bond Fund, New York","page_number":156,"box":{"x":116,"y":351,"width":720,"height":12}},{"id":"6721f373-ddcc-4fe1-9c1d-08d3b1d1de08","block_type":"box","text":"Municipal Opportunities Fund and Pennsylvania Municipal Bond Fund.","page_number":156,"box":{"x":117,"y":366,"width":527,"height":12}},{"id":"59d322d5-1e0e-4a80-9440-ce99ec84dc0a","block_type":"box","text":"Risk Factors and Special Considerations Relating to Municipal Bonds.","page_number":156,"box":{"x":116,"y":397,"width":519,"height":12}},{"id":"681924e3-1a85-4dcb-a91e-be31b0b28bbc","block_type":"box","text":"The risks and special","page_number":156,"box":{"x":636,"y":397,"width":168,"height":12}},{"id":"00c21e5b-bc43-4335-95f1-20c999f7d5f1","block_type":"box","text":"considerations involved in investment in Municipal Bonds vary with the types of instruments being","page_number":156,"box":{"x":116,"y":413,"width":729,"height":12}},{"id":"0ace9035-30de-410e-a86d-aec64ad7a25d","block_type":"box","text":"acquired. Investments in Non-Municipal Tax-Exempt Securities may present similar risks, depending","page_number":156,"box":{"x":116,"y":428,"width":751,"height":12}},{"id":"aa5e1201-4831-4fa4-8b08-f877a3e2af0e","block_type":"box","text":"on the particular product. Certain municipal instruments in which a Fund may invest may be","page_number":156,"box":{"x":116,"y":444,"width":685,"height":12}},{"id":"dba304bd-2aeb-4249-9921-aa832d5472e1","block_type":"box","text":"characterized as derivatives.","page_number":156,"box":{"x":116,"y":459,"width":218,"height":10}},{"id":"e415f89e-3cca-41b5-97df-dc24b7e4d4a6","block_type":"box","text":"The value of Municipal Bonds generally may be affected by uncertainties in the municipal markets as a","page_number":156,"box":{"x":116,"y":490,"width":768,"height":12}},{"id":"50d4f4eb-14b4-4c0d-8322-69958e7f2a89","block_type":"box","text":"result of legislation or litigation, including legislation or litigation that changes the taxation of Municipal","page_number":156,"box":{"x":117,"y":506,"width":757,"height":12}},{"id":"fbf25a90-abef-412d-9235-31e4890e1892","block_type":"box","text":"Bonds or the rights of Municipal Bond holders in the event of a bankruptcy. Municipal bankruptcies are","page_number":156,"box":{"x":117,"y":521,"width":764,"height":12}},{"id":"ba4dca71-1ca1-457c-ba2c-a6addd2ed488","block_type":"box","text":"rare and certain provisions of the U.S. Bankruptcy Code governing such bankruptcies are unclear.","page_number":156,"box":{"x":117,"y":537,"width":732,"height":12}},{"id":"6b737bb5-2e66-412c-bf6b-8239538cbe91","block_type":"box","text":"Further, the application of state law to Municipal Bond issuers could produce varying results among the","page_number":156,"box":{"x":117,"y":552,"width":770,"height":12}},{"id":"03e2d76b-1484-44de-8327-69cfdb77b513","block_type":"box","text":"states or among Municipal Bond issuers within a state. These uncertainties could have a significant","page_number":156,"box":{"x":116,"y":568,"width":742,"height":12}},{"id":"9c720b2d-cdb9-48cb-914c-c047fd57f32d","block_type":"box","text":"impact on the prices of the Municipal Bonds in which a Fund invests.","page_number":156,"box":{"x":117,"y":583,"width":513,"height":12}},{"id":"5d035e90-6987-467f-8e41-f606b8a7f1e9","block_type":"box","text":"Description of Municipal Bonds.","page_number":156,"box":{"x":116,"y":614,"width":240,"height":12}},{"id":"dd56a287-920f-4dad-85d4-b408aaee6637","block_type":"box","text":"Municipal Bonds include debt obligations issued to obtain funds for various public purposes, including","page_number":156,"box":{"x":117,"y":637,"width":757,"height":12}},{"id":"14875353-6aaa-4260-a4e1-21e58d53ab8f","block_type":"box","text":"the construction of a wide range of public facilities, refunding of outstanding obligations and obtaining","page_number":156,"box":{"x":116,"y":653,"width":756,"height":12}},{"id":"c041a24d-f5c6-4158-893a-8066620bef67","block_type":"box","text":"funds for general operating expenses and loans to other public institutions and facilities. In addition,","page_number":156,"box":{"x":116,"y":668,"width":737,"height":12}},{"id":"4b566357-7473-4f1d-950d-70cf5830ee41","block_type":"box","text":"certain types of bonds are issued by or on behalf of public authorities to finance various privately","page_number":156,"box":{"x":116,"y":684,"width":716,"height":12}},{"id":"032d9572-5e6c-4a45-ab09-dd366117a705","block_type":"box","text":"owned or operated facilities, including certain facilities for the local furnishing of electric energy or gas,","page_number":156,"box":{"x":116,"y":699,"width":757,"height":13}},{"id":"8455a3d8-e45d-4a1b-b30f-db1b639fd48f","block_type":"box","text":"sewage facilities, solid waste disposal facilities and other specialized facilities. Such obligations are","page_number":156,"box":{"x":116,"y":715,"width":735,"height":12}},{"id":"c4159902-e83a-4c6f-b076-a846d3317b6f","block_type":"box","text":"included within the term Municipal Bonds if the interest paid thereon is excluded from gross income for","page_number":156,"box":{"x":117,"y":730,"width":760,"height":13}},{"id":"16af86dc-c050-4105-9c64-28187517edcf","block_type":"box","text":"U.S. federal income tax purposes and any applicable state and local taxes. Other types of private","page_number":156,"box":{"x":117,"y":746,"width":721,"height":12}},{"id":"ed188493-f2e3-4483-9cce-1a9283e09595","block_type":"box","text":"activity bonds, the proceeds of which are used for the construction, equipment or improvement of","page_number":156,"box":{"x":116,"y":761,"width":722,"height":13}},{"id":"bc57f82a-82c5-45b1-af48-c2b62eea7fc5","block_type":"box","text":"privately operated industrial or commercial facilities, may constitute Municipal Bonds, although the","page_number":156,"box":{"x":117,"y":777,"width":727,"height":12}},{"id":"7b811efa-6445-412f-bcb2-42fc298b6038","block_type":"box","text":"current U.S. federal tax laws place substantial limitations on the size of such issues. The interest on","page_number":156,"box":{"x":116,"y":792,"width":739,"height":12}},{"id":"0a2d15c4-67f3-4433-b3af-63d4fc9338f5","block_type":"box","text":"Municipal Bonds may bear a fixed rate or be payable at a variable or floating rate. The two principal","page_number":156,"box":{"x":117,"y":808,"width":736,"height":12}},{"id":"df0172dc-46bc-4adc-a5ab-749a5d9b666f","block_type":"box","text":"classifications of Municipal Bonds are “general obligation” and “revenue” or “special obligation” bonds,","page_number":156,"box":{"x":116,"y":823,"width":756,"height":13}},{"id":"241dd3cb-428c-4ab4-a37f-0ebbe7db94e9","block_type":"box","text":"which latter category includes private activity bonds (“PABs”) (or “industrial development bonds” under","page_number":156,"box":{"x":116,"y":839,"width":764,"height":12}},{"id":"505bc6ba-d7f9-45ca-a1dc-4d702445003e","block_type":"box","text":"pre-1986 law).","page_number":156,"box":{"x":117,"y":854,"width":111,"height":13}},{"id":"b0246feb-7889-4bd2-a104-9d1236e6f72f","block_type":"box","text":"II-72","page_number":156,"box":{"x":484,"y":909,"width":31,"height":9}},{"id":"077a24f7-3f31-4743-b028-d7a49e271973","block_type":"box","text":"NM0926U-5926888-156/257","page_number":156,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"34c42f4e-76da-4e22-b627-aef207fb3d2f","block_type":"box","text":"General Obligation Bonds.","page_number":157,"box":{"x":117,"y":87,"width":194,"height":12}},{"id":"9eb8c68e-fc39-46a5-a075-0fc110b98d56","block_type":"box","text":"General obligation bonds are secured by the issuer’s pledge of its full faith,","page_number":157,"box":{"x":313,"y":87,"width":565,"height":12}},{"id":"8998523c-b8f5-49f8-a13c-bd24b62df8c3","block_type":"box","text":"credit and taxing power for the payment of principal and interest. The taxing power of any","page_number":157,"box":{"x":116,"y":102,"width":668,"height":13}},{"id":"21666dcb-b907-430b-894f-3c8bb2f62784","block_type":"box","text":"governmental entity may be limited, however, by provisions of its state constitution or laws, and an","page_number":157,"box":{"x":116,"y":118,"width":735,"height":12}},{"id":"28f9acaf-28c7-440a-8f15-97c032b93419","block_type":"box","text":"entity’s creditworthiness will depend on many factors, including potential erosion of its tax base due to","page_number":157,"box":{"x":116,"y":134,"width":760,"height":12}},{"id":"2151b8de-9a7f-45ce-848b-79c610cb9b24","block_type":"box","text":"population declines, natural disasters, declines in the state’s industrial base or inability to attract new","page_number":157,"box":{"x":117,"y":149,"width":750,"height":12}},{"id":"16cef8c2-1939-4000-a54d-4e5615c75203","block_type":"box","text":"industries, economic limits on the ability to tax without eroding the tax base, state legislative proposals","page_number":157,"box":{"x":117,"y":165,"width":762,"height":12}},{"id":"0582de26-5ca2-4995-981d-352568d7c9eb","block_type":"box","text":"or voter initiatives to limit ad valorem real property taxes and the extent to which the entity relies on","page_number":157,"box":{"x":116,"y":180,"width":740,"height":12}},{"id":"823bcc1e-a48f-4b86-b970-5825751a08ce","block_type":"box","text":"federal or state aid, access to capital markets or other factors beyond the state’s or entity’s control.","page_number":157,"box":{"x":116,"y":196,"width":738,"height":12}},{"id":"c6c6a73c-fa20-429a-841d-89e0b102ffc8","block_type":"box","text":"Accordingly, the capacity of the issuer of a general obligation bond as to the timely payment of interest","page_number":157,"box":{"x":116,"y":211,"width":765,"height":12}},{"id":"6816642d-ac4d-4a27-8f71-59f4449fb23e","block_type":"box","text":"and the repayment of principal when due is affected by the issuer’s maintenance of its tax base.","page_number":157,"box":{"x":116,"y":227,"width":717,"height":12}},{"id":"4e4b44ad-b80c-4ca4-a2b9-02b9bdb61695","block_type":"box","text":"Revenue Bonds.","page_number":157,"box":{"x":116,"y":258,"width":122,"height":9}},{"id":"742edded-6c98-4fac-be25-e58ad018f17e","block_type":"box","text":"Revenue bonds are payable only from the revenues derived from a particular facility","page_number":157,"box":{"x":240,"y":258,"width":634,"height":12}},{"id":"1c96747f-305a-4e61-b8fc-ebb509d291be","block_type":"box","text":"or class of facilities or, in some cases, from the proceeds of a special excise tax or other specific","page_number":157,"box":{"x":116,"y":273,"width":720,"height":12}},{"id":"9594eb4b-3430-4576-814e-980445430664","block_type":"box","text":"revenue source such as payments from the user of the facility being financed; accordingly, the timely","page_number":157,"box":{"x":117,"y":289,"width":752,"height":12}},{"id":"d4e07322-1bad-4b49-8d6a-e03211abde2d","block_type":"box","text":"payment of interest and the repayment of principal in accordance with the terms of the revenue or","page_number":157,"box":{"x":117,"y":304,"width":729,"height":12}},{"id":"d388d30c-a08c-4cdd-a672-7ef0eea2084e","block_type":"box","text":"special obligation bond is a function of the economic viability of such facility or such revenue source.","page_number":157,"box":{"x":116,"y":320,"width":749,"height":12}},{"id":"64e79efa-93ad-402d-af4b-60ea9a3ab2b1","block_type":"box","text":"Revenue bonds issued by state or local agencies to finance the development of low-income, multi","page_number":157,"box":{"x":117,"y":351,"width":730,"height":12}},{"id":"1eb63a9a-1811-419c-8674-b054cd0e0b0c","block_type":"box","text":"family housing involve special risks in addition to those associated with municipal bonds generally,","page_number":157,"box":{"x":116,"y":366,"width":735,"height":12}},{"id":"ef637203-d00b-4775-844b-17ae3fc6ca04","block_type":"box","text":"including that the underlying properties may not generate sufficient income to pay expenses and","page_number":157,"box":{"x":117,"y":382,"width":718,"height":12}},{"id":"9c65f9ae-a21a-4966-820d-36d47b4c8e83","block_type":"box","text":"interest costs. Such bonds are generally non-recourse against the property owner, may be junior to the","page_number":157,"box":{"x":117,"y":397,"width":768,"height":12}},{"id":"1ea058f6-f742-4a98-a070-95d31cee2438","block_type":"box","text":"rights of others with an interest in the properties, may pay interest that changes based in part on the","page_number":157,"box":{"x":117,"y":413,"width":746,"height":12}},{"id":"5ba8d368-923e-4b4b-a2aa-e367ea725431","block_type":"box","text":"financial performance of the property, may be prepayable without penalty and may be used to finance","page_number":157,"box":{"x":116,"y":428,"width":760,"height":12}},{"id":"d947a805-6743-484e-814b-068bc4941779","block_type":"box","text":"the construction of housing developments which, until completed and rented, do not generate income","page_number":157,"box":{"x":116,"y":444,"width":757,"height":12}},{"id":"97a28913-908f-4471-ab7d-2390b2e8df2c","block_type":"box","text":"to pay interest. Increases in interest rates payable on senior obligations may make it more difficult for","page_number":157,"box":{"x":116,"y":459,"width":755,"height":12}},{"id":"d6b60a26-cfc6-43d3-b819-01255b7c7f85","block_type":"box","text":"issuers to meet payment obligations on subordinated bonds.","page_number":157,"box":{"x":117,"y":475,"width":452,"height":12}},{"id":"e97c961a-b0ab-423d-804e-6e1cc301be1d","block_type":"box","text":"PABs.","page_number":157,"box":{"x":116,"y":506,"width":45,"height":9}},{"id":"5d6d3f37-42e3-415d-9869-294036553db5","block_type":"box","text":"PABs are, in most cases, tax-exempt securities issued by states, municipalities or public","page_number":157,"box":{"x":162,"y":506,"width":666,"height":12}},{"id":"9834bc0c-fd42-43f6-9c4e-fbfa0103cb1d","block_type":"box","text":"authorities to provide funds, usually through a loan or lease arrangement, to a private entity for the","page_number":157,"box":{"x":116,"y":521,"width":735,"height":12}},{"id":"47f07f7e-5a62-4320-9cba-8756d5c8a1e7","block_type":"box","text":"purpose of financing construction or improvement of a facility to be used by the entity. Such bonds are","page_number":157,"box":{"x":117,"y":537,"width":762,"height":12}},{"id":"44eb1617-e3e9-4d1e-b660-a2da09e33e76","block_type":"box","text":"secured primarily by revenues derived from loan repayments or lease payments due from the entity,","page_number":157,"box":{"x":116,"y":552,"width":747,"height":12}},{"id":"0ac005b8-c6bc-4488-8952-e77bdd4bc393","block_type":"box","text":"which may or may not be guaranteed by a parent company or otherwise secured. PABs generally are","page_number":157,"box":{"x":116,"y":568,"width":758,"height":12}},{"id":"be0c1554-a07b-4a5a-bd4b-f26daf13393e","block_type":"box","text":"not secured by a pledge of the taxing power of the issuer of such bonds. Therefore, an investor should","page_number":157,"box":{"x":117,"y":583,"width":764,"height":12}},{"id":"d0b6a79a-3bad-4213-bac8-b8c1104266ac","block_type":"box","text":"understand that repayment of such bonds generally depends on the revenues of a private entity and be","page_number":157,"box":{"x":117,"y":599,"width":771,"height":12}},{"id":"4407e973-ee15-43ab-bc3a-015cfc1017e6","block_type":"box","text":"aware of the risks that such an investment may entail. The continued ability of an entity to generate","page_number":157,"box":{"x":116,"y":614,"width":741,"height":12}},{"id":"5a3233db-e6e1-44ea-aaf1-095a7cc43f5c","block_type":"box","text":"sufficient revenues for the payment of principal and interest on such bonds will be affected by many","page_number":157,"box":{"x":116,"y":630,"width":744,"height":12}},{"id":"164d2309-25a5-4f39-b4c6-8da82dd80acd","block_type":"box","text":"factors including the size of the entity, its capital structure, demand for its products or services,","page_number":157,"box":{"x":116,"y":645,"width":707,"height":12}},{"id":"8e94f6c1-c076-42c3-9599-33bc4710e428","block_type":"box","text":"competition, general economic conditions, government regulation and the entity’s dependence on","page_number":157,"box":{"x":116,"y":661,"width":723,"height":12}},{"id":"fa769318-2f10-4862-b550-c54059757863","block_type":"box","text":"revenues for the operation of the particular facility being financed.","page_number":157,"box":{"x":117,"y":676,"width":485,"height":12}},{"id":"cdea6246-9fa8-4ce0-98a2-5418ae0fd0e5","block_type":"box","text":"Moral Obligation Bonds.","page_number":157,"box":{"x":116,"y":707,"width":178,"height":12}},{"id":"97715719-27cc-452e-8487-ca7de458a424","block_type":"box","text":"“Moral obligation” bonds are normally issued by special purpose public","page_number":157,"box":{"x":301,"y":707,"width":523,"height":12}},{"id":"d4f8b920-b8df-4631-8452-9c2047ddcf89","block_type":"box","text":"authorities. If an issuer of moral obligation bonds is unable to meet its obligations, the repayment of","page_number":157,"box":{"x":116,"y":723,"width":738,"height":12}},{"id":"31902eaf-5419-4785-82ee-879e87ab29cc","block_type":"box","text":"such bonds becomes a moral commitment but not a legal obligation of the state or municipality that","page_number":157,"box":{"x":116,"y":738,"width":736,"height":12}},{"id":"5e6eb5bd-44f9-4835-8911-dd01c5ab7432","block_type":"box","text":"created the special purpose public authority that issued the bonds.","page_number":157,"box":{"x":116,"y":754,"width":492,"height":12}},{"id":"f3855872-0a94-4ff1-97f7-b57a4b9ac61e","block_type":"box","text":"Municipal Notes.","page_number":157,"box":{"x":116,"y":785,"width":122,"height":12}},{"id":"9e4cd46b-c7f3-465a-87d9-520921859ed2","block_type":"box","text":"Municipal notes are shorter term municipal debt obligations. They may provide interim","page_number":157,"box":{"x":246,"y":785,"width":636,"height":12}},{"id":"f1ac2078-4b0e-4e07-b580-f0cfb1e396d2","block_type":"box","text":"financing in anticipation of tax collection, bond sales or revenue receipts. If there is a shortfall in the","page_number":157,"box":{"x":116,"y":800,"width":737,"height":12}},{"id":"7bc2214e-47f0-45e9-8d9b-0e4c2bdeb8cc","block_type":"box","text":"anticipated proceeds, repayment on the note may be delayed or the note may not be fully repaid, and a","page_number":157,"box":{"x":116,"y":816,"width":766,"height":12}},{"id":"c6e9338b-b974-45ef-af0e-b7d450c497ca","block_type":"box","text":"Fund may lose money.","page_number":157,"box":{"x":117,"y":831,"width":174,"height":12}},{"id":"630b4d7d-f1b7-47c1-a88f-f4010b05e908","block_type":"box","text":"Municipal Commercial Paper.","page_number":157,"box":{"x":116,"y":862,"width":218,"height":12}},{"id":"bc7ff5d4-ffe5-46a1-a387-7e01d0bca871","block_type":"box","text":"Municipal commercial paper is generally unsecured and issued to meet","page_number":157,"box":{"x":335,"y":862,"width":539,"height":12}},{"id":"8f293e69-820a-4404-8724-54455f45964d","block_type":"box","text":"short-term financing needs. The lack of security presents some risk of loss to a Fund since, in the","page_number":157,"box":{"x":116,"y":878,"width":728,"height":12}},{"id":"91c3d361-7590-4a73-9e6d-aefcd178e626","block_type":"box","text":"II-73","page_number":157,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"74a054d5-9bbd-4068-83c1-cd17ad37a9e7","block_type":"box","text":"NM0926U-5926888-157/257","page_number":157,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"3919eea7-b797-478f-af8a-3869fbca6660","block_type":"box","text":"event of an issuer’s bankruptcy, unsecured creditors are repaid only after the secured creditors out of","page_number":158,"box":{"x":116,"y":87,"width":757,"height":12}},{"id":"7eb7d13b-fc1c-4353-91f6-28a11f198fe3","block_type":"box","text":"the assets, if any, that remain.","page_number":158,"box":{"x":116,"y":102,"width":229,"height":13}},{"id":"0efe6ea8-0078-4902-a9db-f50835fe5210","block_type":"box","text":"Municipal Lease Obligations.","page_number":158,"box":{"x":116,"y":134,"width":213,"height":12}},{"id":"8968b31b-7b1a-4338-ba70-44b3ae0cc81d","block_type":"box","text":"Also included within the general category of Municipal Bonds are","page_number":158,"box":{"x":331,"y":134,"width":491,"height":12}},{"id":"66adc386-833f-4924-b0a3-ae0a8a1ca011","block_type":"box","text":"certificates of participation (“COPs”) issued by government authorities or entities to finance the","page_number":158,"box":{"x":116,"y":149,"width":706,"height":12}},{"id":"f46162ce-66b1-4a1f-b294-3637fb351471","block_type":"box","text":"acquisition or construction of equipment, land and/or facilities. The COPs represent participations in a","page_number":158,"box":{"x":116,"y":165,"width":758,"height":11}},{"id":"b6a786ff-2099-4bfb-b605-1de1157ece33","block_type":"box","text":"lease, an installment purchase contract or a conditional sales contract (hereinafter collectively called","page_number":158,"box":{"x":117,"y":180,"width":748,"height":12}},{"id":"10299d03-a8f6-40b5-8645-218b6ea296b7","block_type":"box","text":"“lease obligations”) relating to such equipment, land or facilities. Municipal leases, like other municipal","page_number":158,"box":{"x":116,"y":196,"width":761,"height":12}},{"id":"98702811-b492-4c91-97f6-4ec9bed68a5d","block_type":"box","text":"debt obligations, are subject to the risk of non-payment. Although lease obligations do not constitute","page_number":158,"box":{"x":116,"y":211,"width":747,"height":12}},{"id":"9f979ca0-9ec0-4ea6-afe5-e80e0bc5007b","block_type":"box","text":"general obligations of the issuer for which the issuer’s unlimited taxing power is pledged, a lease","page_number":158,"box":{"x":116,"y":227,"width":721,"height":12}},{"id":"beed27fc-c423-4814-ab44-867b564fde5e","block_type":"box","text":"obligation is frequently backed by the issuer’s covenant to budget for, appropriate and make the","page_number":158,"box":{"x":116,"y":242,"width":716,"height":12}},{"id":"7ff7571d-f559-456e-ac61-bab7aeb7dcd4","block_type":"box","text":"payments due under the lease obligation. However, certain lease obligations contain","page_number":158,"box":{"x":117,"y":258,"width":631,"height":12}},{"id":"e06c1b04-bf7d-4135-8e5b-b79cd116c1dd","block_type":"box","text":"“non-appropriation” clauses, which provide that the issuer has no obligation to make lease or","page_number":158,"box":{"x":116,"y":273,"width":693,"height":12}},{"id":"15d1cff7-b3d1-4ee1-aff3-abdb26fec5fc","block_type":"box","text":"installment purchase payments in future years unless money is appropriated for such purpose on a","page_number":158,"box":{"x":117,"y":289,"width":739,"height":12}},{"id":"f47f2bb6-44fc-4c9c-a5b0-8139d36fa7d5","block_type":"box","text":"yearly basis. Although “non-appropriation” lease obligations are secured by the leased property,","page_number":158,"box":{"x":116,"y":304,"width":716,"height":12}},{"id":"702ddf8c-f230-48bf-89ac-64a97ec8a23b","block_type":"box","text":"disposition of the property in the event of foreclosure might prove difficult. These securities represent a","page_number":158,"box":{"x":116,"y":320,"width":767,"height":12}},{"id":"0091b4fa-66f2-453e-8e64-8c8c13cda940","block_type":"box","text":"type of financing that has not yet developed the depth of marketability associated with more","page_number":158,"box":{"x":116,"y":335,"width":685,"height":12}},{"id":"9c3b9aa4-77b4-4628-8ea3-412c78e94a71","block_type":"box","text":"conventional securities. Certain investments in lease obligations may be illiquid.","page_number":158,"box":{"x":116,"y":351,"width":596,"height":12}},{"id":"cf377a08-635c-4e73-9450-a99ab250a3e8","block_type":"box","text":"The ability of issuers of municipal leases to make timely lease payments may be adversely impacted in","page_number":158,"box":{"x":116,"y":382,"width":769,"height":12}},{"id":"5c26a054-9f87-4ebd-a425-0aed475df3b4","block_type":"box","text":"general economic downturns and as relative governmental cost burdens are allocated and reallocated","page_number":158,"box":{"x":116,"y":397,"width":762,"height":12}},{"id":"6c58d783-2e0b-42ab-a763-b2e446172111","block_type":"box","text":"among federal, state and local governmental units. Such non-payment would result in a reduction of","page_number":158,"box":{"x":116,"y":413,"width":746,"height":12}},{"id":"6ce92bfa-beeb-4561-b509-2a249af77901","block_type":"box","text":"income to a Fund, and could result in a reduction in the value of the municipal lease experiencing","page_number":158,"box":{"x":117,"y":428,"width":726,"height":12}},{"id":"30300109-20f2-4f74-a8a8-b9f8e1b65b71","block_type":"box","text":"non-payment and a potential decrease in the NAV of a Fund. Issuers of municipal securities might","page_number":158,"box":{"x":117,"y":444,"width":731,"height":12}},{"id":"adf38572-5d7e-4181-a20d-1c32d69be221","block_type":"box","text":"seek protection under the bankruptcy laws. In the event of bankruptcy of such an issuer, a Fund could","page_number":158,"box":{"x":116,"y":459,"width":762,"height":12}},{"id":"e33217e7-1bae-44f8-a56f-52ab3b6b0046","block_type":"box","text":"experience delays and limitations with respect to the collection of principal and interest on such","page_number":158,"box":{"x":116,"y":475,"width":711,"height":12}},{"id":"da681bc2-74a8-4899-b47d-72a4a16184ac","block_type":"box","text":"municipal leases and a Fund may not, in all circumstances, be able to collect all principal and interest","page_number":158,"box":{"x":117,"y":490,"width":755,"height":12}},{"id":"7f9c564c-fadb-4509-af74-311326a4509a","block_type":"box","text":"to which it is entitled. To enforce its rights in the event of a default in lease payments, a Fund might","page_number":158,"box":{"x":116,"y":506,"width":740,"height":12}},{"id":"505c0b12-e662-4daf-97c7-c78c14e5d0ca","block_type":"box","text":"take possession of and manage the assets securing the issuer’s obligations on such securities, which","page_number":158,"box":{"x":116,"y":521,"width":758,"height":12}},{"id":"c9816f8c-07bc-4fa5-be3e-5d7b81f75371","block_type":"box","text":"may increase a Fund’s operating expenses and adversely affect the NAV of a Fund. When the lease","page_number":158,"box":{"x":117,"y":537,"width":749,"height":12}},{"id":"5998eaf6-7594-4eca-bf02-f6175102ea41","block_type":"box","text":"contains a non-appropriation clause, however, the failure to pay would not be a default and a Fund","page_number":158,"box":{"x":116,"y":552,"width":737,"height":12}},{"id":"297bb994-cf93-419a-a651-c5554139512f","block_type":"box","text":"would not have the right to take possession of the assets. Any income derived from a Fund’s","page_number":158,"box":{"x":116,"y":568,"width":692,"height":12}},{"id":"29ce572b-f5c6-422c-b6b7-94c131f6676e","block_type":"box","text":"ownership or operation of such assets may not be tax-exempt. In addition, a Fund’s intention to qualify","page_number":158,"box":{"x":116,"y":583,"width":765,"height":12}},{"id":"96c3c63b-0b05-4b40-b518-3efdf548d70e","block_type":"box","text":"as a “regulated investment company” under the Code, may limit the extent to which a Fund may","page_number":158,"box":{"x":116,"y":599,"width":717,"height":12}},{"id":"3a56a167-9a69-4ef2-9369-6b4cf6cac74e","block_type":"box","text":"exercise its rights by taking possession of such assets, because as a regulated investment company a","page_number":158,"box":{"x":116,"y":614,"width":765,"height":12}},{"id":"38714836-2fca-4041-86b9-1139143738c3","block_type":"box","text":"Fund is subject to certain limitations on its investments and on the nature of its income.","page_number":158,"box":{"x":117,"y":630,"width":650,"height":12}},{"id":"02e53a83-1e04-4616-a2af-b43fd717dd6a","block_type":"box","text":"Tender Option Bonds.","page_number":158,"box":{"x":118,"y":661,"width":161,"height":12}},{"id":"374d0085-671a-4659-838a-e8d88d43a2a3","block_type":"box","text":"Certain Funds may invest in residual inverse floating rate interest tender option","page_number":158,"box":{"x":286,"y":661,"width":585,"height":12}},{"id":"5a27d083-c030-48bb-95df-0c41b7040b3a","block_type":"box","text":"bonds (“TOB Residuals”), which are derivative interests in Municipal Bonds. The TOB Residuals in","page_number":158,"box":{"x":117,"y":676,"width":730,"height":12}},{"id":"ab21d7e0-6a54-4a0e-b180-fab058e926a6","block_type":"box","text":"which the Funds will invest pay interest or income that, in the opinion of counsel to the issuer, is","page_number":158,"box":{"x":116,"y":692,"width":710,"height":12}},{"id":"dae988e7-9506-4414-966a-ca7a1c641cdd","block_type":"box","text":"exempt from regular U.S. federal income tax. BlackRock will not conduct its own analysis of the tax","page_number":158,"box":{"x":116,"y":707,"width":735,"height":12}},{"id":"1d640fed-6325-444f-8b60-a77098bfb783","block_type":"box","text":"status of the interest or income paid by TOB Residuals held by the Funds, but will rely on the opinion of","page_number":158,"box":{"x":116,"y":723,"width":767,"height":12}},{"id":"2301dd24-0df1-4f19-9dd5-19292100252f","block_type":"box","text":"counsel to the issuer. Although volatile, TOB Residuals typically offer the potential for yields exceeding","page_number":158,"box":{"x":116,"y":738,"width":761,"height":12}},{"id":"6c1fff40-b800-47f0-8cd1-a56c52476259","block_type":"box","text":"the yields available on fixed rate Municipal Bonds with comparable credit quality. The Funds may","page_number":158,"box":{"x":116,"y":754,"width":720,"height":12}},{"id":"4bbb11f0-633c-4df4-be98-3702e6f321da","block_type":"box","text":"invest in TOB Residuals for the purpose of using economic leverage.","page_number":158,"box":{"x":117,"y":769,"width":509,"height":12}},{"id":"455c8b9c-82d6-4edd-b14e-c2d94adca24c","block_type":"box","text":"TOB Residuals represent beneficial interests in a special purpose trust formed for the purpose of","page_number":158,"box":{"x":116,"y":800,"width":719,"height":12}},{"id":"08e51f9c-5f3c-4eb8-bc33-cb31ee1f3d56","block_type":"box","text":"holding Municipal Bonds contributed by one or more funds (a “TOB Trust”). A TOB Trust typically","page_number":158,"box":{"x":117,"y":816,"width":719,"height":12}},{"id":"2ad53b55-20c3-4c65-8ae1-b47250d0cd6b","block_type":"box","text":"issues two classes of beneficial interests: short-term floating rate interests (“TOB Floaters”), which are","page_number":158,"box":{"x":117,"y":831,"width":762,"height":12}},{"id":"045fe185-59fe-4a8b-aab1-24dec23eb62a","block_type":"box","text":"sold to third-party investors, and TOB Residuals, which are generally issued to the fund(s) that","page_number":158,"box":{"x":116,"y":847,"width":706,"height":12}},{"id":"c50b41b3-7840-4892-9dbd-fde4f934189c","block_type":"box","text":"transferred Municipal Bonds to the TOB Trust. The Funds may invest in both TOB Floaters and TOB","page_number":158,"box":{"x":116,"y":862,"width":750,"height":12}},{"id":"4f25da69-e74f-4798-b9bb-44d025f28345","block_type":"box","text":"Residuals. TOB Floaters may have first priority on the cash flow from the Municipal Bonds held by the","page_number":158,"box":{"x":117,"y":878,"width":759,"height":12}},{"id":"a7353919-2581-4747-8cac-091eac625c88","block_type":"box","text":"II-74","page_number":158,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"e1d35d70-e2cb-4dd9-9a0f-13d3f9fd0047","block_type":"box","text":"NM0926U-5926888-158/257","page_number":158,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"e3d89509-a465-41e9-8fe8-df760c660aac","block_type":"box","text":"TOB Trust and are enhanced with a liquidity support arrangement from a third-party Liquidity Provider","page_number":159,"box":{"x":116,"y":87,"width":760,"height":12}},{"id":"04ff7d92-24b6-4b00-ab15-ad3613aae323","block_type":"box","text":"(defined below) which allows holders to tender their position at par (plus accrued interest). A Fund, as","page_number":159,"box":{"x":117,"y":102,"width":758,"height":13}},{"id":"81d736d4-4767-403c-b792-90beb80775fc","block_type":"box","text":"a holder of TOB Residuals, is paid the residual cash flow from the TOB Trust. A Fund that contributes","page_number":159,"box":{"x":116,"y":118,"width":759,"height":12}},{"id":"11e2f450-78b1-41cc-b86c-ab5f76d4a23c","block_type":"box","text":"the Municipal Bonds to the TOB Trust is paid the cash received by the TOB Trust from the sale of the","page_number":159,"box":{"x":116,"y":134,"width":757,"height":12}},{"id":"ac16665c-274c-4e08-9a37-44453c111d1f","block_type":"box","text":"TOB Floaters, less certain transaction costs, and typically will invest the cash to purchase additional","page_number":159,"box":{"x":116,"y":149,"width":746,"height":12}},{"id":"8290123f-4756-4de1-909a-13692ae3fee4","block_type":"box","text":"Municipal Bonds or other investments permitted by its investment policies. If a Fund ever purchases all","page_number":159,"box":{"x":117,"y":165,"width":767,"height":12}},{"id":"7505bf04-8a74-4b0e-be30-c913be391264","block_type":"box","text":"or a portion of the TOB Floaters sold by the TOB Trust, it may surrender those TOB Floaters together","page_number":159,"box":{"x":116,"y":180,"width":758,"height":12}},{"id":"dd5ad966-a7ac-4678-a642-75afb6d33b42","block_type":"box","text":"with a proportionate amount of TOB Residuals to the TOB Trust in exchange for a proportionate","page_number":159,"box":{"x":116,"y":196,"width":717,"height":12}},{"id":"5831cf8d-2c23-43ff-848d-55e55c9b6cd1","block_type":"box","text":"amount of the Municipal Bonds owned by the TOB Trust.","page_number":159,"box":{"x":116,"y":211,"width":427,"height":12}},{"id":"cb41dcc3-6188-46d9-8b2b-a498d9323da3","block_type":"box","text":"Other BlackRock-advised funds may contribute Municipal Bonds to a TOB Trust into which a Fund has","page_number":159,"box":{"x":116,"y":242,"width":767,"height":12}},{"id":"ae25cd3e-8ec4-4b85-b6fd-96b6977da055","block_type":"box","text":"contributed Municipal Bonds. If multiple BlackRock-advised funds participate in the same TOB Trust,","page_number":159,"box":{"x":116,"y":258,"width":752,"height":11}},{"id":"6e717008-6c2d-4e0f-a0a0-8fc3d44b79c3","block_type":"box","text":"the economic rights and obligations under the TOB Residual will generally be shared among the funds","page_number":159,"box":{"x":116,"y":273,"width":764,"height":12}},{"id":"82c33942-2157-4641-9407-bdbbe522bba4","block_type":"box","text":"ratably in proportion to their participation in the TOB Trust.","page_number":159,"box":{"x":117,"y":289,"width":437,"height":12}},{"id":"f9b83c0e-2dff-418c-baf2-b91aa31b9b6a","block_type":"box","text":"The Municipal Bonds transferred to a TOB Trust typically are high grade Municipal Bonds. In certain","page_number":159,"box":{"x":116,"y":320,"width":747,"height":12}},{"id":"2fbdb7e5-0b30-4e0a-abc5-4cd30e68e871","block_type":"box","text":"cases, when Municipal Bonds transferred are lower grade Municipal Bonds, the TOB Trust transaction","page_number":159,"box":{"x":116,"y":335,"width":764,"height":12}},{"id":"0f4ef9af-081d-4871-aff1-b3550d08ea75","block_type":"box","text":"includes a credit enhancement feature that provides for the timely payment of principal and interest on","page_number":159,"box":{"x":117,"y":351,"width":762,"height":12}},{"id":"152126ff-dcd9-4d61-8f08-29ade435187a","block_type":"box","text":"the bonds to the TOB Trust by a credit enhancement provider. The TOB Trust would be responsible for","page_number":159,"box":{"x":116,"y":366,"width":770,"height":12}},{"id":"9af2ac19-07a7-4b9a-aed5-69c005799995","block_type":"box","text":"the payment of the credit enhancement fee and a Fund, as a TOB Residual holder, would be","page_number":159,"box":{"x":116,"y":382,"width":693,"height":12}},{"id":"3c82a7f0-946d-4d02-9a42-e413e2bcc99f","block_type":"box","text":"responsible for reimbursement of any payments of principal and interest made by the credit","page_number":159,"box":{"x":117,"y":397,"width":681,"height":12}},{"id":"c1b0853c-9c47-4285-9d1b-82303338edf0","block_type":"box","text":"enhancement provider.","page_number":159,"box":{"x":116,"y":413,"width":176,"height":12}},{"id":"74d7ed89-3fd7-456e-b558-7d625a4710ec","block_type":"box","text":"The TOB Residuals held by a Fund generally provide the Fund with the right to cause the holders of a","page_number":159,"box":{"x":116,"y":444,"width":760,"height":12}},{"id":"e7c193d8-7393-436b-ba02-4de9d6e6bdf9","block_type":"box","text":"proportional share of the TOB Floaters to tender their notes to the TOB Trust at par plus accrued","page_number":159,"box":{"x":117,"y":459,"width":722,"height":12}},{"id":"0adf7f93-3b6c-4c7e-8683-e779125c121a","block_type":"box","text":"interest. Thereafter, the Fund may withdraw a corresponding share of the Municipal Bonds from the","page_number":159,"box":{"x":117,"y":475,"width":743,"height":12}},{"id":"d8adf7fd-da0d-4763-bb46-c2b8f680baf3","block_type":"box","text":"TOB Trust. This transaction, in effect, creates exposure for the Fund to the entire return of the","page_number":159,"box":{"x":116,"y":490,"width":702,"height":12}},{"id":"85c6d252-7d38-4071-9b4c-13723c093267","block_type":"box","text":"Municipal Bonds in the TOB Trust, with a net cash investment by the Fund that is less than the value of","page_number":159,"box":{"x":117,"y":506,"width":770,"height":12}},{"id":"128458cb-7673-4637-85e4-2f429e12b421","block_type":"box","text":"the Municipal Bonds in the TOB Trust. This multiplies the positive or negative impact of the Municipal","page_number":159,"box":{"x":116,"y":521,"width":755,"height":12}},{"id":"383709b1-2bf3-45ab-95c5-e00c54274cd0","block_type":"box","text":"Bonds’ return within the Fund (thereby creating leverage). The leverage within a TOB Trust depends","page_number":159,"box":{"x":117,"y":537,"width":749,"height":12}},{"id":"69d3b0ca-63fe-447b-9098-ed9fcd1cf0d7","block_type":"box","text":"on the value of the Municipal Bonds deposited in the TOB Trust relative to the value of the TOB","page_number":159,"box":{"x":116,"y":552,"width":714,"height":12}},{"id":"de76959d-064d-4235-88b9-255509d29695","block_type":"box","text":"Floaters it issues.","page_number":159,"box":{"x":117,"y":568,"width":134,"height":9}},{"id":"78cd2f1e-82db-4f06-a797-a228b6cc19e5","block_type":"box","text":"A Fund may invest in highly leveraged TOB Residuals. A TOB Residual generally is considered highly","page_number":159,"box":{"x":116,"y":599,"width":762,"height":12}},{"id":"00404b5f-5aaf-4208-8d58-3a2c8fd26760","block_type":"box","text":"leveraged if the principal amount of the TOB Floaters issued by the related TOB Trust exceeds 75% of","page_number":159,"box":{"x":117,"y":614,"width":765,"height":12}},{"id":"35c5c1bd-c234-4702-8535-d81c45af1e3f","block_type":"box","text":"the principal amount of the Municipal Bonds owned by the TOB Trust.","page_number":159,"box":{"x":116,"y":630,"width":523,"height":12}},{"id":"ec1c5117-7b56-42ad-b028-a00288c9d251","block_type":"box","text":"The TOB Trust may be collapsed without the consent of a Fund upon the occurrence of tender option","page_number":159,"box":{"x":116,"y":661,"width":751,"height":12}},{"id":"7f735e0d-8b38-436f-abde-a95ef299fdd0","block_type":"box","text":"termination events (“TOTEs”) and mandatory termination events (“MTEs”), as defined in the TOB Trust","page_number":159,"box":{"x":116,"y":676,"width":763,"height":12}},{"id":"954158ea-771f-49de-9414-5b4f03e2d928","block_type":"box","text":"agreements. TOTEs include the bankruptcy or default of the issuer of the Municipal Bonds held in the","page_number":159,"box":{"x":116,"y":692,"width":752,"height":12}},{"id":"2d6f12ba-85e2-48b6-a2dd-938f6e9ff9ec","block_type":"box","text":"TOB Trust, a substantial downgrade in the credit quality of the issuer of the Municipal Bonds held in","page_number":159,"box":{"x":116,"y":707,"width":739,"height":12}},{"id":"917521fb-574a-439b-9195-877f3497d46c","block_type":"box","text":"the TOB Trust, failure of any scheduled payment of principal or interest on the Municipal Bonds, and a","page_number":159,"box":{"x":116,"y":723,"width":758,"height":12}},{"id":"69ef41a6-b11b-40f2-9e0a-ec5f62f568b6","block_type":"box","text":"judgment or ruling that interest on the Municipal Bonds is subject to U.S. federal income taxation.","page_number":159,"box":{"x":115,"y":738,"width":721,"height":12}},{"id":"000ee1bc-6364-4046-b90d-296ccb35eb0a","block_type":"box","text":"MTEs may include, among other things, a failed remarketing of the TOB Floaters, the inability of the","page_number":159,"box":{"x":117,"y":754,"width":739,"height":12}},{"id":"4d45c981-01b4-4849-9f1b-90333db72909","block_type":"box","text":"TOB Trust to obtain renewal of the liquidity support agreement, and a substantial decline in the market","page_number":159,"box":{"x":116,"y":769,"width":760,"height":12}},{"id":"3db554ec-a192-4ce8-851e-ba21006010f7","block_type":"box","text":"value of the Municipal Bonds held in the TOB Trust. Upon the occurrence of a TOTE or an MTE, a","page_number":159,"box":{"x":116,"y":785,"width":729,"height":12}},{"id":"254a8d2e-b85f-4ce8-ab36-184e9c27f9f6","block_type":"box","text":"TOB Trust would be liquidated with the proceeds applied first to any accrued fees owed to the trustee","page_number":159,"box":{"x":116,"y":800,"width":752,"height":12}},{"id":"8b8c92eb-4d67-4401-a7e8-364021e5f31a","block_type":"box","text":"of the TOB Trust, the remarketing agent of the TOB Floaters and the Liquidity Provider (defined","page_number":159,"box":{"x":116,"y":816,"width":708,"height":12}},{"id":"52fe4fd6-e585-4506-9b33-b98e81761d09","block_type":"box","text":"below). In the case of an MTE, after the payment of fees, the holders of the TOB Floaters would be","page_number":159,"box":{"x":117,"y":831,"width":739,"height":12}},{"id":"a11e3845-b5bc-4fa5-b86a-6e518bf985f7","block_type":"box","text":"paid senior to the TOB Residual holders (","page_number":159,"box":{"x":117,"y":847,"width":307,"height":12}},{"id":"ec474a77-56cc-4b18-a9f0-b6416597fbbe","block_type":"box","text":"i.e.","page_number":159,"box":{"x":425,"y":847,"width":20,"height":9}},{"id":"b336d33e-6e05-4ec9-ba19-41dad2866009","block_type":"box","text":", the Fund). In contrast, in the case of a TOTE, after","page_number":159,"box":{"x":448,"y":847,"width":389,"height":12}},{"id":"f797131d-d896-4937-b2f0-48c278729bf8","block_type":"box","text":"payment of fees, the holders of TOB Floaters and the TOB Residual holders would be paid pro rata in","page_number":159,"box":{"x":117,"y":862,"width":759,"height":12}},{"id":"2a379af7-9c12-4d63-979f-fe65dd9a3c82","block_type":"box","text":"proportion to the respective face values of their certificates.","page_number":159,"box":{"x":117,"y":878,"width":443,"height":12}},{"id":"634328ce-26fa-477e-9613-682de7efe319","block_type":"box","text":"II-75","page_number":159,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"d31fc294-1d14-4b88-a812-0a0f863d2d57","block_type":"box","text":"NM0926U-5926888-159/257","page_number":159,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"d72fe987-e534-44e2-92be-ab7c391633c8","block_type":"box","text":"A Fund may invest in a TOB Trust on either a non-recourse or recourse basis. TOB Trusts are typically","page_number":160,"box":{"x":116,"y":87,"width":769,"height":12}},{"id":"2ddcc4bd-d39c-4074-ba3f-2de355bc9c9f","block_type":"box","text":"supported by a liquidity facility provided by a third-party bank or other financial institution (the “Liquidity","page_number":160,"box":{"x":116,"y":102,"width":766,"height":13}},{"id":"cfc43c3b-da35-4f4a-a29c-c0c7ab29f887","block_type":"box","text":"Provider”) that allows the holders of the TOB Floaters to tender their TOB Floaters in exchange for","page_number":160,"box":{"x":117,"y":118,"width":734,"height":12}},{"id":"131fea65-203e-40ba-bb97-bd0d33abe093","block_type":"box","text":"payment of par plus accrued interest on any business day (subject to the non-occurrence of a TOTE","page_number":160,"box":{"x":117,"y":134,"width":748,"height":12}},{"id":"fac2259f-9f51-4188-8269-8b32eaf7ae55","block_type":"box","text":"described above). Depending on the structure of the TOB Trust, the Liquidity Provider may purchase","page_number":160,"box":{"x":116,"y":149,"width":752,"height":12}},{"id":"f2e368c2-f30a-4278-b6a7-6a3d42786abc","block_type":"box","text":"the tendered TOB Floaters, or the TOB Trust may draw upon a loan from the Liquidity Provider to","page_number":160,"box":{"x":116,"y":165,"width":728,"height":12}},{"id":"f6cf290a-ebee-451f-90a2-199e566d4496","block_type":"box","text":"purchase the tendered TOB Floaters.","page_number":160,"box":{"x":117,"y":180,"width":281,"height":12}},{"id":"49653234-d440-420c-9884-6f0a1847312e","block_type":"box","text":"When a Fund invests in TOB Trusts on a non-recourse basis, and the Liquidity Provider is required to","page_number":160,"box":{"x":116,"y":211,"width":758,"height":12}},{"id":"007a4baf-0e10-4eb5-aca6-8c40cba05917","block_type":"box","text":"make a payment under the liquidity facility, the Liquidity Provider will typically liquidate all or a portion","page_number":160,"box":{"x":117,"y":227,"width":753,"height":12}},{"id":"17480c7a-6b01-422d-b5e6-0260d0f3a107","block_type":"box","text":"of the Municipal Bonds held in the TOB Trust and then fund the balance, if any, of the amount owed","page_number":160,"box":{"x":116,"y":242,"width":746,"height":12}},{"id":"143f3d5a-5842-4e1c-b6a7-0f648d66c7d0","block_type":"box","text":"under the liquidity facility over the liquidation proceeds (the “Liquidation Shortfall”). If a Fund invests in","page_number":160,"box":{"x":117,"y":258,"width":760,"height":12}},{"id":"6d25bda2-2e0a-4703-aa1f-b7da20bf8b7f","block_type":"box","text":"a TOB Trust on a recourse basis, it will typically enter into a reimbursement agreement with the","page_number":160,"box":{"x":116,"y":273,"width":712,"height":12}},{"id":"df5c2b8a-f719-4eea-8705-abde6beb281f","block_type":"box","text":"Liquidity Provider pursuant to which the Fund is required to reimburse the Liquidity Provider the","page_number":160,"box":{"x":117,"y":289,"width":712,"height":12}},{"id":"59c99099-5e01-49ac-8ca0-ea8aaec605a7","block_type":"box","text":"amount of any Liquidation Shortfall. As a result, if the Fund invests in a recourse TOB Trust, the Fund","page_number":160,"box":{"x":116,"y":304,"width":759,"height":12}},{"id":"b9af162b-eb7c-4d51-ac60-df0d8066bbb6","block_type":"box","text":"will bear the risk of loss with respect to any Liquidation Shortfall. If multiple BlackRock-advised funds","page_number":160,"box":{"x":116,"y":320,"width":751,"height":12}},{"id":"91994dec-05c4-4514-8e46-291c0bc538bf","block_type":"box","text":"participate in any such TOB Trust, these losses will be shared ratably, in proportion to their","page_number":160,"box":{"x":117,"y":335,"width":678,"height":12}},{"id":"74cdefa0-d10a-4d33-aac8-3a01f7f00ea4","block_type":"box","text":"participation in the TOB Trust.","page_number":160,"box":{"x":117,"y":351,"width":227,"height":12}},{"id":"619e608e-76be-498f-9083-f03668c12b60","block_type":"box","text":"Under accounting rules, Municipal Bonds of a Fund that are deposited into a TOB Trust are","page_number":160,"box":{"x":117,"y":382,"width":682,"height":12}},{"id":"e8a2514d-89dc-4c40-985f-ba82a45bc630","block_type":"box","text":"investments of the Fund and are presented on the Fund’s Schedule of Investments and outstanding","page_number":160,"box":{"x":117,"y":397,"width":745,"height":12}},{"id":"9d22749d-980f-4d26-a491-fbc767db2bf2","block_type":"box","text":"TOB Floaters issued by a TOB Trust are presented as liabilities in the Fund’s Statement of Assets and","page_number":160,"box":{"x":116,"y":413,"width":765,"height":12}},{"id":"e2563812-f746-476d-acc1-f86d3afb51b7","block_type":"box","text":"Liabilities. Interest income from the underlying Municipal Bonds is recorded by a Fund on an accrual","page_number":160,"box":{"x":117,"y":428,"width":747,"height":12}},{"id":"96205b1e-0d0d-46d6-8e48-4d6c1aa405dd","block_type":"box","text":"basis. Interest expense incurred on the","page_number":160,"box":{"x":117,"y":444,"width":288,"height":12}},{"id":"c423344a-d3da-40f3-8a33-1fd4984c39a1","block_type":"box","text":"TOB Floaters and other expenses related to remarketing,","page_number":160,"box":{"x":409,"y":444,"width":430,"height":12}},{"id":"974a18b0-9b13-41a9-93be-8638463e971d","block_type":"box","text":"administration, trustee and other services to a TOB Trust are reported as expenses of a Fund. In","page_number":160,"box":{"x":116,"y":459,"width":722,"height":12}},{"id":"3b11ffcc-5d31-47ee-8308-c31b5395f565","block_type":"box","text":"addition, under accounting rules, loans made to a TOB Trust sponsored by a Fund may be presented","page_number":160,"box":{"x":116,"y":475,"width":757,"height":12}},{"id":"7ea885be-7ede-4b8b-839f-94ce27e31464","block_type":"box","text":"as loans of the Fund in the Fund’s financial statements even if there is no recourse to the Fund’s","page_number":160,"box":{"x":116,"y":490,"width":721,"height":10}},{"id":"d94a4bce-b617-41c1-8f57-dff2cde816ff","block_type":"box","text":"assets.","page_number":160,"box":{"x":116,"y":506,"width":58,"height":9}},{"id":"148747d9-8d14-44ae-a0b8-b7b2d599dde4","block_type":"box","text":"For TOB Floaters, generally, the interest rate earned will be based upon the market rates for Municipal","page_number":160,"box":{"x":117,"y":537,"width":765,"height":12}},{"id":"b22b5b3c-54f7-409e-a6a3-0d306f6fbf96","block_type":"box","text":"Bonds with maturities or remarketing provisions that are comparable in duration to the periodic interval","page_number":160,"box":{"x":117,"y":552,"width":764,"height":12}},{"id":"6dc95f2f-e483-4069-a535-49899f38e460","block_type":"box","text":"of the tender option. Since the tender option feature has a shorter term than the final maturity or first","page_number":160,"box":{"x":116,"y":568,"width":748,"height":12}},{"id":"0ecdeeb4-83ec-4d1a-a0d2-0b426b19270c","block_type":"box","text":"call date of the underlying Municipal Bonds deposited in the TOB Trust, the holder of the TOB Floaters","page_number":160,"box":{"x":116,"y":583,"width":766,"height":12}},{"id":"de4c6af4-d708-4646-b3e9-dbc1a85674d2","block_type":"box","text":"relies upon the terms of the agreement with the financial institution furnishing the liquidity facility as","page_number":160,"box":{"x":117,"y":599,"width":738,"height":12}},{"id":"fd36c26d-b087-4f21-abaa-eee48cc608bd","block_type":"box","text":"well as the credit strength of that institution. The risk associated with TOB Floaters, however, may be","page_number":160,"box":{"x":116,"y":614,"width":754,"height":12}},{"id":"d1db6b93-bc05-4d73-be3b-03380dbc071a","block_type":"box","text":"increased in the current market environment as a result of recent downgrades to the credit ratings, and","page_number":160,"box":{"x":117,"y":630,"width":767,"height":12}},{"id":"25b37fca-1233-405a-a64b-6ddd65be6ba0","block_type":"box","text":"thus the perceived reliability and creditworthiness, of many major financial institutions, some of which","page_number":160,"box":{"x":116,"y":645,"width":755,"height":12}},{"id":"59d2a33e-af37-4527-b716-71ea911f4a2a","block_type":"box","text":"sponsor and/or provide liquidity support to TOB Trusts. This in turn may reduce the desirability of TOB","page_number":160,"box":{"x":116,"y":661,"width":758,"height":12}},{"id":"e2ea9b09-6598-4a12-9531-2f454b394064","block_type":"box","text":"Floaters as investments, which could impair the viability or availability of TOB Trusts.","page_number":160,"box":{"x":117,"y":676,"width":627,"height":12}},{"id":"ac9b6a06-a165-4399-801e-aa841835799c","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into TOB Trust transactions,","page_number":160,"box":{"x":117,"y":707,"width":737,"height":12}},{"id":"5c50da80-2de4-456e-9f8d-bbe2baf8abe9","block_type":"box","text":"reverse repurchase agreements and similar financing transactions (e.g., borrowed bonds)","page_number":160,"box":{"x":117,"y":723,"width":664,"height":12}},{"id":"5f715fab-64d5-4dbe-ac8e-6d05b629e003","block_type":"box","text":"notwithstanding the limitation on the issuance of senior securities in Section 18 of the Investment","page_number":160,"box":{"x":117,"y":738,"width":718,"height":12}},{"id":"aec9acbd-6625-4e54-a22c-28a1b3b2f0c3","block_type":"box","text":"Company Act, provided that the Fund either (i) complies with the 300% asset coverage ratio with","page_number":160,"box":{"x":117,"y":754,"width":715,"height":12}},{"id":"d58c011f-5246-4453-a51d-5b68b0244047","block_type":"box","text":"respect to such transactions and any other borrowings in the aggregate, or (ii) treats such transactions","page_number":160,"box":{"x":117,"y":769,"width":759,"height":12}},{"id":"5310e81a-47f7-46c4-8156-6c19bb6d41f9","block_type":"box","text":"as Derivatives Transactions under Rule 18f-4. See “— Derivatives — Regulation of Derivatives —","page_number":160,"box":{"x":116,"y":785,"width":726,"height":12}},{"id":"d14ad99e-f3c2-4f9d-bcb0-ed7b74d97bdc","block_type":"box","text":"Rule 18f-4 under the Investment Company Act” above.","page_number":160,"box":{"x":117,"y":800,"width":404,"height":12}},{"id":"b8946914-1ac8-4972-847b-6ea3dfd3f601","block_type":"box","text":"Developments in the TOB Trust Market.","page_number":160,"box":{"x":116,"y":831,"width":301,"height":12}},{"id":"f2b1a52b-8834-4f9f-b824-2cb67e05e51b","block_type":"box","text":"In response to the restrictions imposed by section 619 of the","page_number":160,"box":{"x":419,"y":831,"width":452,"height":12}},{"id":"9186d17e-721f-4cde-9466-7edd95668f34","block_type":"box","text":"Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Volcker Rule”), market participants","page_number":160,"box":{"x":117,"y":847,"width":766,"height":12}},{"id":"aa3cdc37-09e3-4353-8209-e4e444998f39","block_type":"box","text":"have developed a structure for TOB Trusts designed to ensure that no banking entity is sponsoring the","page_number":160,"box":{"x":117,"y":862,"width":766,"height":12}},{"id":"df1a30e8-59a7-40f6-8304-ae2fd05e227c","block_type":"box","text":"TOB Trust for purposes of the Volcker Rule. Specifically, a Fund will establish, structure and “sponsor”","page_number":160,"box":{"x":116,"y":878,"width":765,"height":12}},{"id":"1df71e9d-7a12-4abe-a47e-0de5fc64a515","block_type":"box","text":"II-76","page_number":160,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"72f48570-8fb3-40ca-ac89-c83a2c0d18af","block_type":"box","text":"NM0926U-5926888-160/257","page_number":160,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9a7eb60e-7cd0-4923-b5c1-ba1b47471dce","block_type":"box","text":"the TOB Trusts in which it holds TOB Residuals. In such a structure, certain responsibilities that","page_number":161,"box":{"x":116,"y":87,"width":715,"height":12}},{"id":"aca60ce2-98be-4b65-9a5f-614876ae3ec6","block_type":"box","text":"previously belonged to the sponsor bank will be performed by, or on behalf of, a Fund. A Fund may","page_number":161,"box":{"x":117,"y":102,"width":740,"height":13}},{"id":"dd760d7c-efc0-4f1a-845a-3f484dfda23e","block_type":"box","text":"utilize service providers in meeting these responsibilities. It is possible that regulators could take","page_number":161,"box":{"x":117,"y":118,"width":717,"height":12}},{"id":"afbf8669-b188-4e33-a446-132f453e465a","block_type":"box","text":"positions that could limit the market for such structured TOB Trust transactions or a Fund’s ability to","page_number":161,"box":{"x":117,"y":134,"width":744,"height":12}},{"id":"d96fec63-e0bb-438c-87e3-558df71b46e6","block_type":"box","text":"hold TOB Residuals. Under this TOB Trust structure, a Fund has certain additional duties and","page_number":161,"box":{"x":117,"y":149,"width":699,"height":11}},{"id":"186fa6f4-cae0-4bef-b316-863f8064b84f","block_type":"box","text":"responsibilities, which may give rise to certain additional risks including","page_number":161,"box":{"x":117,"y":165,"width":525,"height":12}},{"id":"2dcec80f-d71c-4a2e-a05f-c3123741430c","block_type":"box","text":",","page_number":161,"box":{"x":643,"y":173,"width":3,"height":3}},{"id":"61917b17-e05b-4b75-9009-7651ddcef66b","block_type":"box","text":"but not limited to, compliance,","page_number":161,"box":{"x":648,"y":165,"width":232,"height":11}},{"id":"054072ab-5daf-4c66-aa75-98745713857f","block_type":"box","text":"securities law and operational risks.","page_number":161,"box":{"x":116,"y":180,"width":270,"height":12}},{"id":"dac3bec1-8bb6-45c3-9608-5694f7a73864","block_type":"box","text":"Under this structure, service providers to a TOB Trust, such as administrators, liquidity providers,","page_number":161,"box":{"x":117,"y":208,"width":724,"height":12}},{"id":"e438843c-fc9f-4ed5-a9cd-7d188e0e7aa3","block_type":"box","text":"trustees, and remarketing agents, act at the direction of, and as agent of, a Fund as the TOB Residual","page_number":161,"box":{"x":116,"y":223,"width":764,"height":13}},{"id":"a8520065-f292-454d-b593-a3022b123a6d","block_type":"box","text":"holder. Similar to the traditional tender option bond structure, a Fund deposits Municipal Bonds into the","page_number":161,"box":{"x":117,"y":239,"width":768,"height":12}},{"id":"af46ee71-384d-4c85-bac4-eb617c936ddc","block_type":"box","text":"TOB Trust in exchange for TOB Residuals, the TOB Trust then issues and sells TOB Floaters to third","page_number":161,"box":{"x":116,"y":254,"width":757,"height":13}},{"id":"390f1d6c-4f5d-4814-b8cd-68c24428fcf0","block_type":"box","text":"party investors, and the proceeds of the sale of the TOB Floaters is distributed to such TOB Residual","page_number":161,"box":{"x":117,"y":270,"width":754,"height":12}},{"id":"6989bd4c-8d2a-49a4-87b3-3be643eadad1","block_type":"box","text":"holders (","page_number":161,"box":{"x":117,"y":285,"width":64,"height":13}},{"id":"ff3248a2-3058-44c4-b887-3e164732822e","block_type":"box","text":"i.e.","page_number":161,"box":{"x":182,"y":286,"width":20,"height":9}},{"id":"c513a904-df4b-45d6-a869-90a5446ee747","block_type":"box","text":", the Fund). Tendered TOB Floaters continue to be supported by a remarketing agent and","page_number":161,"box":{"x":205,"y":285,"width":671,"height":13}},{"id":"3927ea8b-194b-447f-b6df-9cdbec948890","block_type":"box","text":"a liquidity facility. However, the remarketing agent does not purchase tendered TOB Floaters for its","page_number":161,"box":{"x":116,"y":301,"width":740,"height":12}},{"id":"0422c62e-674c-4cf9-976e-142a5c30ac15","block_type":"box","text":"own account in the event of a failed remarketing, which may increase the likelihood that a TOB Trust","page_number":161,"box":{"x":116,"y":316,"width":751,"height":13}},{"id":"79808a5c-7bd8-4a02-a66c-6b96474bce86","block_type":"box","text":"will need to be collapsed and liquidated in order to purchase the tendered TOB Floaters. In the event of","page_number":161,"box":{"x":116,"y":332,"width":772,"height":12}},{"id":"79a3eeb1-7f42-4a56-a661-a61cdead8e43","block_type":"box","text":"a failed remarketing of TOB Floaters, the Liquidity Provider, at its option, may advance a loan to the","page_number":161,"box":{"x":116,"y":347,"width":745,"height":13}},{"id":"f510fb46-b233-4536-8325-747e72998c98","block_type":"box","text":"TOB Trust the proceeds of which would be used by the TOB Trust to purchase the tendered TOB","page_number":161,"box":{"x":116,"y":363,"width":728,"height":12}},{"id":"91881738-1726-4547-8642-6f89bb848b76","block_type":"box","text":"Floaters. The Liquidity Provider is not obligated to advance such a loan. The TOB Trust would be the","page_number":161,"box":{"x":117,"y":378,"width":753,"height":13}},{"id":"131e6ced-b1f8-466c-b426-4e63dbae512f","block_type":"box","text":"borrower with respect to any such loan. Any loans made by a Liquidity Provider will be secured by the","page_number":161,"box":{"x":117,"y":394,"width":758,"height":12}},{"id":"54fa8ce8-4b94-47ab-8333-fe2734d67d84","block_type":"box","text":"purchased TOB Floaters held by the TOB Trust.","page_number":161,"box":{"x":117,"y":409,"width":361,"height":13}},{"id":"7023d068-2e47-49a5-9d56-2de8cb6fd72d","block_type":"box","text":"Similar to the traditional structure for TOB Trusts, a Fund may hold either non-recourse TOB Residuals","page_number":161,"box":{"x":116,"y":437,"width":769,"height":12}},{"id":"8b052979-b127-4ba2-9e49-428898db1c35","block_type":"box","text":"or recourse TOB Residuals under this structure. In the event of a Liquidation Shortfall, there would","page_number":161,"box":{"x":116,"y":453,"width":735,"height":12}},{"id":"1aad3c10-78e6-4bef-8a43-a575c160df47","block_type":"box","text":"generally be no contractual recourse to the Fund’s assets if the Fund holds a non-recourse TOB","page_number":161,"box":{"x":116,"y":468,"width":718,"height":12}},{"id":"de2c0cfb-01d5-4bd2-a525-c7a99cd3fa69","block_type":"box","text":"Residual. However, as described above, a Fund would bear the risk of loss with respect to any","page_number":161,"box":{"x":117,"y":484,"width":706,"height":12}},{"id":"e0cbc50e-b67e-4f65-8f24-38992ea21799","block_type":"box","text":"Liquidation Shortfall if it holds a recourse TOB Residual.","page_number":161,"box":{"x":117,"y":499,"width":420,"height":12}},{"id":"312a16e9-4a64-432a-8b80-a4b77d5eaa22","block_type":"box","text":"The SEC and various federal banking and housing agencies adopted credit risk retention rules for","page_number":161,"box":{"x":116,"y":527,"width":730,"height":12}},{"id":"9357b916-3e9f-4d40-ae87-0b39f14c64e3","block_type":"box","text":"securitizations (the “Risk Retention Rules”), which took effect in December 2016. The Risk Retention","page_number":161,"box":{"x":116,"y":543,"width":753,"height":12}},{"id":"ca020011-d2bb-47a2-92ce-c55ffbf4c130","block_type":"box","text":"Rules require the sponsor of a TOB Trust to retain at least 5% of the credit risk of the underlying assets","page_number":161,"box":{"x":117,"y":558,"width":771,"height":12}},{"id":"474b20a2-961e-4bed-9927-4e64d6b8ecd1","block_type":"box","text":"supporting the TOB Trust’s Municipal Bonds. The Risk Retention Rules may adversely affect the","page_number":161,"box":{"x":116,"y":574,"width":721,"height":12}},{"id":"cbe1e97f-be9a-4a56-96d7-39aa588e5100","block_type":"box","text":"Fund’s ability to engage in TOB Trust transactions or increase the costs of such transactions in certain","page_number":161,"box":{"x":117,"y":589,"width":764,"height":12}},{"id":"68987e84-b1d2-4008-b1a9-aa4e3f788144","block_type":"box","text":"circumstances.","page_number":161,"box":{"x":116,"y":605,"width":117,"height":9}},{"id":"ba30ef4f-d39f-4214-9f9a-cbade245bc9c","block_type":"box","text":"TOB Trust transactions constitute an important component of the municipal bond market. Accordingly,","page_number":161,"box":{"x":116,"y":633,"width":763,"height":12}},{"id":"dfbbf582-3596-40d3-9845-fa83cf407195","block_type":"box","text":"implementation of the Volcker Rule may adversely impact the municipal market, including through","page_number":161,"box":{"x":117,"y":648,"width":729,"height":12}},{"id":"7d6346b6-edc9-490f-bcf9-cf585e5297b2","block_type":"box","text":"reduced demand for and liquidity of municipal bonds and increased financing costs for municipal","page_number":161,"box":{"x":117,"y":664,"width":713,"height":12}},{"id":"37a45346-367b-4dfc-ab64-fc7ac614755b","block_type":"box","text":"issuers. Any such developments could adversely affect the Funds. The ultimate impact of these rules","page_number":161,"box":{"x":117,"y":679,"width":749,"height":12}},{"id":"2199245f-b538-4235-a75c-c0064cfe9e4b","block_type":"box","text":"on the TOB market and the overall municipal market is not yet certain.","page_number":161,"box":{"x":116,"y":695,"width":520,"height":12}},{"id":"bfe8b0d6-2561-4279-aa94-021b94a29241","block_type":"box","text":"Yields.","page_number":161,"box":{"x":118,"y":723,"width":47,"height":9}},{"id":"8422b288-5d87-40e5-856b-4a91dd88cac5","block_type":"box","text":"Yields on Municipal Bonds are dependent on a variety of factors, including the general","page_number":161,"box":{"x":171,"y":723,"width":639,"height":12}},{"id":"d98aeecf-666c-4c6c-964e-c0bef43ecc04","block_type":"box","text":"condition of the money market and of the municipal bond market, the size of a particular offering, the","page_number":161,"box":{"x":116,"y":738,"width":746,"height":12}},{"id":"8091ea0c-7395-4287-8a1c-790b343e7a75","block_type":"box","text":"financial condition of the issuer, the maturity of the obligation and the rating of the issue. The ability of","page_number":161,"box":{"x":116,"y":754,"width":754,"height":12}},{"id":"4777b200-89ec-44f3-8be9-9f7c421edd08","block_type":"box","text":"a Fund to achieve its investment objective is also dependent on the continuing ability of the issuers of","page_number":161,"box":{"x":116,"y":769,"width":753,"height":12}},{"id":"d1bc5144-2dc8-49dd-a01e-28c4acf1e460","block_type":"box","text":"the securities in which the Fund invests to meet their obligations for the payment of interest and","page_number":161,"box":{"x":116,"y":785,"width":708,"height":12}},{"id":"fe0e34a8-d33a-41f5-bb8d-56a7563e4a6b","block_type":"box","text":"principal when due. There are variations in the risks involved in holding Municipal Bonds, both within a","page_number":161,"box":{"x":117,"y":800,"width":757,"height":12}},{"id":"77c4a5b0-2b96-4d2c-884c-741f0abd8cd8","block_type":"box","text":"particular classification and between classifications, depending on numerous factors. Furthermore, the","page_number":161,"box":{"x":117,"y":816,"width":758,"height":12}},{"id":"c1ec505c-1b0e-41d7-ba07-86ffba325873","block_type":"box","text":"rights of owners of Municipal Bonds and the obligations of the issuer of such Municipal Bonds may be","page_number":161,"box":{"x":117,"y":831,"width":758,"height":12}},{"id":"a8182c0e-0c42-4f3c-91bb-f936c731ad0a","block_type":"box","text":"subject to applicable bankruptcy, insolvency and similar laws and court decisions affecting the rights of","page_number":161,"box":{"x":116,"y":847,"width":767,"height":12}},{"id":"1c979548-be9b-4aed-9d07-a05c1b35f6b8","block_type":"box","text":"creditors generally and to general equitable principles, which may limit the enforcement of certain","page_number":161,"box":{"x":116,"y":862,"width":727,"height":12}},{"id":"1e748c9d-f240-42e5-9d98-8788a3a49bea","block_type":"box","text":"remedies.","page_number":161,"box":{"x":117,"y":878,"width":77,"height":9}},{"id":"788b7d71-2ee7-41d1-b470-527d4aac52fc","block_type":"box","text":"II-77","page_number":161,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"5dde4ab8-a2a7-4776-8f3b-e857e65d82ae","block_type":"box","text":"NM0926U-5926888-161/257","page_number":161,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"b42e9e9b-af6b-47c7-b375-97089c4f0f43","block_type":"box","text":"Variable Rate Demand Obligations (“VRDOs”).","page_number":162,"box":{"x":118,"y":87,"width":344,"height":12}},{"id":"185e7418-3f43-4a80-a99e-55a6703bb665","block_type":"box","text":"VRDOs are tax-exempt obligations that contain a","page_number":162,"box":{"x":464,"y":87,"width":374,"height":12}},{"id":"6d547483-7501-44d8-91d4-53d2c5c6e0ec","block_type":"box","text":"floating or variable interest rate adjustment formula and a right of demand on the part of the holder","page_number":162,"box":{"x":116,"y":102,"width":736,"height":13}},{"id":"a23ac4b4-65b4-4494-90af-e90c5adc3548","block_type":"box","text":"thereof to receive payment of the unpaid principal balance plus accrued interest upon a short notice","page_number":162,"box":{"x":116,"y":118,"width":745,"height":12}},{"id":"89e44361-b826-4703-a930-d37e61ecf328","block_type":"box","text":"period not to exceed seven days.","page_number":162,"box":{"x":117,"y":134,"width":250,"height":12}},{"id":"b8897ed1-5542-4a9b-ac83-60255033f786","block_type":"box","text":"There is the possibility that because of default or insolvency the demand feature of VRDOs may not be","page_number":162,"box":{"x":116,"y":162,"width":768,"height":12}},{"id":"d642fcac-83aa-443f-a42f-ed58898ac97a","block_type":"box","text":"honored. The interest rates are adjustable at periodic intervals to some prevailing market rate for","page_number":162,"box":{"x":117,"y":177,"width":721,"height":12}},{"id":"2c28adb0-a22a-43c0-8625-54e732e47ef1","block_type":"box","text":"similar investments, such adjustment formula being calculated to maintain the market rate of the","page_number":162,"box":{"x":116,"y":193,"width":718,"height":12}},{"id":"11a58254-d06a-4202-8e89-b1139b765050","block_type":"box","text":"VRDOs at approximately the par value of the VRDOs on the adjustment date. The adjustments","page_number":162,"box":{"x":116,"y":208,"width":710,"height":12}},{"id":"8fc0c144-eaff-4fc9-8dea-d6e71a963e9e","block_type":"box","text":"typically are based upon the Securities Industry and Financial Markets Association (“SIFMA”) Index.","page_number":162,"box":{"x":116,"y":224,"width":746,"height":12}},{"id":"87d5cea7-66fc-44a8-a7d5-ee85bd03e15f","block_type":"box","text":"Because of the interest rate adjustment formula on VRDOs, VRDOs are not comparable to fixed rate","page_number":162,"box":{"x":117,"y":252,"width":751,"height":12}},{"id":"c05d3ede-c001-4893-8ff6-ae0906bb793d","block_type":"box","text":"securities. During periods of declining interest rates, a Fund’s yield on a VRDO will decrease and its","page_number":162,"box":{"x":116,"y":268,"width":746,"height":12}},{"id":"17ba4698-3bfb-4e97-a8ee-5de1cd0040ac","block_type":"box","text":"shareholders will forego the opportunity for capital appreciation. During periods of rising interest rates,","page_number":162,"box":{"x":116,"y":283,"width":761,"height":12}},{"id":"5ad703dd-0197-45f2-96ef-59909eb26c1e","block_type":"box","text":"however, a Fund’s yield on a VRDO will increase and the Fund’s shareholders will have a reduced risk","page_number":162,"box":{"x":117,"y":299,"width":764,"height":12}},{"id":"c9e5ca3f-c816-4f16-a170-a6acfe5724fd","block_type":"box","text":"of capital depreciation.","page_number":162,"box":{"x":116,"y":314,"width":173,"height":12}},{"id":"4f3785c0-9b0e-4ae9-b5bd-6e94ee2294b5","block_type":"box","text":"Transactions in Financial Futures Contracts on Municipal Indexes.","page_number":162,"box":{"x":118,"y":343,"width":488,"height":12}},{"id":"05e6d85a-fd06-4941-8256-7f3177110431","block_type":"box","text":"The Municipal Funds and certain","page_number":162,"box":{"x":608,"y":343,"width":253,"height":12}},{"id":"91e79d0c-c97c-42f1-ac27-2af11c475094","block_type":"box","text":"other funds deal in financial futures contracts based on a long-term municipal bond index developed by","page_number":162,"box":{"x":116,"y":358,"width":770,"height":12}},{"id":"a1b518c8-2a0e-4f90-870b-ae945182fb30","block_type":"box","text":"the Chicago Board of Trade (“CBT”) and The Bond Buyer (the “Municipal Bond Index”). The Municipal","page_number":162,"box":{"x":116,"y":374,"width":761,"height":12}},{"id":"7fcfda4a-383a-4039-b2d3-5640782c00f9","block_type":"box","text":"Bond Index is comprised of 40 long-term, actively traded tax-exempt municipal revenue and general","page_number":162,"box":{"x":117,"y":389,"width":746,"height":12}},{"id":"2c44c069-7ae7-4c26-ac13-7ae3d71bbb28","block_type":"box","text":"obligation bonds. Each bond included in the Municipal Bond Index must be rated A or higher by","page_number":162,"box":{"x":116,"y":405,"width":712,"height":12}},{"id":"8f92073b-0d55-4bc1-bed3-c252e0dd0cb8","block_type":"box","text":"Moody’s or S&P and must have a remaining maturity of 19 years or more. Twice a month new issues","page_number":162,"box":{"x":117,"y":420,"width":754,"height":12}},{"id":"ab4aa213-2d75-4532-9a6f-b51a2a283355","block_type":"box","text":"satisfying the eligibility requirements are added to, and an equal number of old issues are deleted from,","page_number":162,"box":{"x":116,"y":436,"width":771,"height":12}},{"id":"7c6aa3ed-6106-4f55-9da8-1462241b2560","block_type":"box","text":"the Municipal Bond Index. The value of the Municipal Bond Index is computed daily according to a","page_number":162,"box":{"x":116,"y":451,"width":734,"height":12}},{"id":"7114dfe2-4331-4b0b-93ca-b9cbc4d1f10e","block_type":"box","text":"formula based on the price of each bond in the Municipal Bond Index, as evaluated by six","page_number":162,"box":{"x":116,"y":467,"width":670,"height":12}},{"id":"faa4def4-d5a4-44c7-9c95-be39c06d992d","block_type":"box","text":"dealer-to-dealer brokers.","page_number":162,"box":{"x":116,"y":482,"width":189,"height":10}},{"id":"e5bfe2ed-9fa7-4455-915b-6a6a3e14b10d","block_type":"box","text":"The Municipal Bond Index futures contract is traded only on the CBT. Like other contract markets, the","page_number":162,"box":{"x":116,"y":511,"width":760,"height":12}},{"id":"3cab6a7f-bf3e-48f0-b50c-42dfccc286cd","block_type":"box","text":"CBT assures performance under futures contracts through a clearing corporation, a nonprofit","page_number":162,"box":{"x":117,"y":526,"width":694,"height":12}},{"id":"c8da3cf2-fa00-40a9-8e04-ce35112e2247","block_type":"box","text":"organization managed by the exchange membership that is also responsible for handling daily","page_number":162,"box":{"x":116,"y":542,"width":704,"height":12}},{"id":"c8cdf4e0-5dbc-4bb9-942c-6eb6343f38c1","block_type":"box","text":"accounting of deposits or withdrawals of margin.","page_number":162,"box":{"x":116,"y":557,"width":364,"height":12}},{"id":"d043777d-0d80-49c8-96e8-aec3bb7d5174","block_type":"box","text":"The particular municipal bonds comprising the index underlying the Municipal Bond Index financial","page_number":162,"box":{"x":116,"y":585,"width":735,"height":12}},{"id":"e24ed802-541a-420f-ac5f-f48926a5d6b6","block_type":"box","text":"futures contract may vary from the bonds held by a Municipal Fund. As a result, a Municipal Fund’s","page_number":162,"box":{"x":116,"y":601,"width":741,"height":12}},{"id":"cead0fd2-be9a-45eb-8f3f-d74260180bd1","block_type":"box","text":"ability to hedge effectively all or a portion of the value of its Municipal Bonds through the use of such","page_number":162,"box":{"x":116,"y":616,"width":749,"height":12}},{"id":"d9d07ddb-ccef-48df-98d6-ccd0e34acf78","block_type":"box","text":"financial futures contracts will depend in part on the degree to which price movements in the index","page_number":162,"box":{"x":116,"y":632,"width":734,"height":12}},{"id":"58f59a7b-8676-4080-91ac-989ee918b394","block_type":"box","text":"underlying the financial futures contract correlate with the price movements of the Municipal Bonds","page_number":162,"box":{"x":117,"y":647,"width":737,"height":13}},{"id":"67a51f12-9113-4715-be03-1e1e8d3aabd1","block_type":"box","text":"held by the Fund. The correlation may be affected by disparities in the average maturity, ratings,","page_number":162,"box":{"x":117,"y":663,"width":712,"height":12}},{"id":"485c3e3a-2402-4b78-a921-252f82d08987","block_type":"box","text":"geographical mix or structure of a Municipal Fund’s investments as compared to those comprising the","page_number":162,"box":{"x":116,"y":678,"width":755,"height":13}},{"id":"3d13ff05-7fd8-46a7-beaf-540dccd4adc0","block_type":"box","text":"Municipal Bond Index and general economic or political factors. In addition, the correlation between","page_number":162,"box":{"x":117,"y":694,"width":736,"height":12}},{"id":"e7c1a87d-95d6-49d8-9ce6-a10ca58138c4","block_type":"box","text":"movements in the value of the Municipal Bond Index may be subject to change over time as additions","page_number":162,"box":{"x":117,"y":709,"width":753,"height":13}},{"id":"1d79ab3a-1efc-4191-9de1-9662cba965b8","block_type":"box","text":"to and deletions from the Municipal Bond Index alter its structure. The correlation between futures","page_number":162,"box":{"x":116,"y":725,"width":725,"height":12}},{"id":"1a074c2f-98d0-44a7-a8b3-559f158538f3","block_type":"box","text":"contracts on U.S. Government Securities and the Municipal Bonds held by a Municipal Fund may be","page_number":162,"box":{"x":116,"y":740,"width":745,"height":13}},{"id":"1fddee6c-5b4a-4047-8251-11ac6cfb6abe","block_type":"box","text":"adversely affected by similar factors and the risk of imperfect correlation between movements in the","page_number":162,"box":{"x":116,"y":756,"width":740,"height":12}},{"id":"16922d99-afc5-44aa-ae28-77fb45ee9f8c","block_type":"box","text":"prices of such futures contracts and the prices of Municipal Bonds held by a Municipal Fund may be","page_number":162,"box":{"x":117,"y":771,"width":740,"height":13}},{"id":"d68381cd-1bf2-4443-94b8-a267267795f5","block_type":"box","text":"greater. Municipal Bond Index futures contracts were approved for trading in 1985. Trading in such","page_number":162,"box":{"x":116,"y":787,"width":732,"height":12}},{"id":"7930b05a-06b8-47e6-adce-bd50cd31fca6","block_type":"box","text":"futures contracts may tend to be less liquid than trading in other futures contracts. The trading of","page_number":162,"box":{"x":116,"y":802,"width":716,"height":13}},{"id":"bae432e6-5182-48db-853f-94a0d3b1ddcf","block_type":"box","text":"futures contracts also is subject to certain market risks, such as inadequate trading activity, which","page_number":162,"box":{"x":116,"y":818,"width":723,"height":12}},{"id":"fe00d68c-d700-4055-96be-b04649a7c185","block_type":"box","text":"could at times make it difficult or impossible to liquidate existing positions.","page_number":162,"box":{"x":116,"y":833,"width":552,"height":13}},{"id":"48dc1edf-18df-42ac-b001-adbb715c3e9c","block_type":"box","text":"Call Rights.","page_number":162,"box":{"x":117,"y":862,"width":83,"height":12}},{"id":"c84b4d0e-42bc-472e-b9e2-577ba18a4d6a","block_type":"box","text":"A Fund may purchase a Municipal Bond issuer’s right to call all or a portion of such","page_number":162,"box":{"x":202,"y":862,"width":626,"height":12}},{"id":"0cce5b54-ce17-4c1d-b8e0-31cfee7b7f6a","block_type":"box","text":"Municipal Bond for mandatory tender for purchase (a “Call Right”). A holder of a Call Right may","page_number":162,"box":{"x":117,"y":877,"width":711,"height":12}},{"id":"aac13411-c9c1-49c7-8b05-e493e974f14d","block_type":"box","text":"II-78","page_number":162,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"3250cb7b-0c16-445a-97e2-978ac9ac9b60","block_type":"box","text":"NM0926U-5926888-162/257","page_number":162,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"c00ce019-e3b7-4a43-8f81-5bdbc6778e39","block_type":"box","text":"exercise such right to require a mandatory tender for the purchase of related Municipal Bonds, subject","page_number":163,"box":{"x":116,"y":87,"width":763,"height":12}},{"id":"01c15ba2-8d87-4604-908a-e553ffb82985","block_type":"box","text":"to certain conditions. A Call Right that is not exercised prior to maturity of the related Municipal Bond","page_number":163,"box":{"x":116,"y":102,"width":751,"height":13}},{"id":"0cebd173-24c0-4828-9d3c-5c4d1e26fa67","block_type":"box","text":"will expire without value. The economic effect of holding both the Call Right and the related Municipal","page_number":163,"box":{"x":116,"y":118,"width":756,"height":12}},{"id":"7b3973b7-1584-4672-bc01-27fe9346f622","block_type":"box","text":"Bond is identical to holding a Municipal Bond as a non-callable security. Certain investments in such","page_number":163,"box":{"x":117,"y":134,"width":748,"height":12}},{"id":"d9bce754-247d-4096-8124-dc09f1ea32bb","block_type":"box","text":"obligations may be illiquid.","page_number":163,"box":{"x":116,"y":149,"width":201,"height":12}},{"id":"87293335-4637-4106-9557-11d175309f3a","block_type":"box","text":"Municipal Interest Rate Swap Transactions.","page_number":163,"box":{"x":116,"y":180,"width":323,"height":12}},{"id":"530fd2ea-9db1-4d8c-adbf-bc853c1cf886","block_type":"box","text":"In order to hedge the value of a Fund against interest rate","page_number":163,"box":{"x":440,"y":180,"width":439,"height":12}},{"id":"07633fdf-f993-46b8-be3b-22fbaa1c443c","block_type":"box","text":"fluctuations or to enhance a Fund’s income, a Fund may enter into interest rate swap transactions such","page_number":163,"box":{"x":116,"y":196,"width":772,"height":12}},{"id":"33123b4d-db5e-4eb4-9f64-2175e00b6c00","block_type":"box","text":"as Municipal Market Data AAA Cash Curve swaps (“MMD Swaps”) or Securities Industry and Financial","page_number":163,"box":{"x":116,"y":211,"width":769,"height":12}},{"id":"7df9610c-911b-4efe-84b4-bf28621dfe96","block_type":"box","text":"Markets Association Municipal Swap Index swaps (“SIFMA Swaps”). To the extent that a Fund enters","page_number":163,"box":{"x":117,"y":227,"width":758,"height":12}},{"id":"bb5bcf78-1f4c-43d4-9381-ad36cef88446","block_type":"box","text":"into these transactions, the Fund expects to do so primarily to preserve a return or spread on a","page_number":163,"box":{"x":117,"y":242,"width":708,"height":12}},{"id":"aade7811-a204-4d10-8e06-a41377f5ff83","block_type":"box","text":"particular investment or portion of its portfolio or to protect against any increase in the price of","page_number":163,"box":{"x":117,"y":258,"width":699,"height":12}},{"id":"dbdd1c4e-5897-4434-8e42-5e5931690dcb","block_type":"box","text":"securities the Fund anticipates purchasing at a later date. A Fund intends to use these transactions","page_number":163,"box":{"x":116,"y":273,"width":741,"height":12}},{"id":"4160045c-c20c-48bd-90e6-6a76a2706241","block_type":"box","text":"primarily as a hedge rather than as a speculative investment. However, a Fund also may invest in","page_number":163,"box":{"x":117,"y":289,"width":729,"height":12}},{"id":"60403e4e-a274-49a6-a0a8-3d8c2fd4cd21","block_type":"box","text":"MMD Swaps and SIFMA Swaps to enhance income or gain or to increase the Fund’s yield, for","page_number":163,"box":{"x":117,"y":304,"width":704,"height":12}},{"id":"750dc1d5-6f15-4c9f-b513-67ec170a0298","block_type":"box","text":"example, during periods of steep interest rate yield curves (","page_number":163,"box":{"x":116,"y":320,"width":441,"height":12}},{"id":"123a7527-2ad3-46c3-a5d2-555fc1319b8b","block_type":"box","text":"i.e.","page_number":163,"box":{"x":558,"y":320,"width":20,"height":9}},{"id":"957d5e68-6d01-4208-84a2-aaed53ed0809","block_type":"box","text":", wide differences between short-term","page_number":163,"box":{"x":581,"y":320,"width":284,"height":11}},{"id":"6f44210d-421d-4311-9c1f-81e44ec5cfe5","block_type":"box","text":"and long-term interest rates).","page_number":163,"box":{"x":116,"y":335,"width":221,"height":12}},{"id":"155725d4-0ca8-4334-ad13-6b132375127d","block_type":"box","text":"A Fund may purchase and sell SIFMA Swaps in the SIFMA swap market. In a SIFMA Swap, a Fund","page_number":163,"box":{"x":116,"y":366,"width":747,"height":12}},{"id":"844e53b9-d4cb-4eb3-81b0-d9ac0b9fa1e8","block_type":"box","text":"exchanges with another party their respective commitments to pay or receive interest (","page_number":163,"box":{"x":116,"y":382,"width":642,"height":12}},{"id":"63187654-cf10-4148-bb5d-479b98a6c482","block_type":"box","text":"e.g.","page_number":163,"box":{"x":760,"y":384,"width":25,"height":10}},{"id":"29e9c57e-6fe3-49ab-b4ab-0374ccb55ff6","block_type":"box","text":", an","page_number":163,"box":{"x":788,"y":384,"width":32,"height":9}},{"id":"f64933b2-e508-4c25-bf59-edaac6f2c009","block_type":"box","text":"exchange of fixed rate payments for floating rate payments linked to the SIFMA Municipal Swap","page_number":163,"box":{"x":116,"y":397,"width":717,"height":12}},{"id":"960baa8e-ac2c-493c-ade3-d7b9123fbb73","block_type":"box","text":"Index). Because the underlying index is a tax-exempt index, SIFMA Swaps may reduce cross-market","page_number":163,"box":{"x":117,"y":413,"width":755,"height":12}},{"id":"7d0d7a7a-bdc0-45d8-addb-bb718536ccf5","block_type":"box","text":"risks incurred by a Fund and increase a Fund’s ability to hedge effectively. SIFMA Swaps are typically","page_number":163,"box":{"x":117,"y":428,"width":760,"height":12}},{"id":"ecec89f4-638e-4d92-9563-98538fde7b52","block_type":"box","text":"quoted for the entire yield curve, beginning with a seven day floating rate index out to 30 years. The","page_number":163,"box":{"x":116,"y":444,"width":745,"height":12}},{"id":"2a5e0561-246b-433c-ad5a-0aad02e7a2e7","block_type":"box","text":"duration of a SIFMA Swap is approximately equal to the duration of a fixed-rate Municipal Bond with","page_number":163,"box":{"x":116,"y":459,"width":747,"height":12}},{"id":"8a511f0e-29fe-49eb-b1f7-6a0b3e295029","block_type":"box","text":"the same attributes as the swap (","page_number":163,"box":{"x":116,"y":475,"width":247,"height":12}},{"id":"cba34e21-54d4-4858-a19f-571583f55720","block_type":"box","text":"e.g.","page_number":163,"box":{"x":365,"y":477,"width":25,"height":10}},{"id":"9944ced2-440d-4bbe-89bb-15d7fffb7b80","block_type":"box","text":", coupon, maturity, call feature).","page_number":163,"box":{"x":393,"y":475,"width":240,"height":12}},{"id":"02fad39e-85e8-4038-9a0a-bbc2f9d51b32","block_type":"box","text":"A Fund may also purchase and sell MMD Swaps, also known as MMD rate locks. An MMD Swap","page_number":163,"box":{"x":116,"y":506,"width":727,"height":12}},{"id":"271c5c3c-7efa-45fa-b529-2a7ce526d1f3","block_type":"box","text":"permits a Fund to lock in a specified municipal interest rate for a portion of its portfolio to preserve a","page_number":163,"box":{"x":117,"y":521,"width":744,"height":12}},{"id":"2eebbbb7-db37-45d3-850f-ec503f3589e5","block_type":"box","text":"return on a particular investment or a portion of its portfolio as a duration management technique or to","page_number":163,"box":{"x":117,"y":537,"width":761,"height":12}},{"id":"8110654a-9147-4f74-8fee-6185e18045c7","block_type":"box","text":"protect against any increase in the price of securities to be purchased at a later date. By using an MMD","page_number":163,"box":{"x":117,"y":552,"width":771,"height":12}},{"id":"1c9801a2-ec3c-4bbe-b75d-366ac2ef0a0b","block_type":"box","text":"Swap, a Fund can create a synthetic long or short position, allowing the Fund to select the most","page_number":163,"box":{"x":116,"y":568,"width":715,"height":12}},{"id":"f3857c01-c9a5-4c8e-bd7c-9db9609bdb73","block_type":"box","text":"attractive part of the yield curve. An MMD Swap is a contract between a Fund and an MMD Swap","page_number":163,"box":{"x":116,"y":583,"width":729,"height":12}},{"id":"df4d30e4-48bb-49a3-936a-b5d37f7984ed","block_type":"box","text":"provider pursuant to which the parties agree to make payments to each other on a notional amount,","page_number":163,"box":{"x":117,"y":599,"width":744,"height":12}},{"id":"ba9d1fd6-0ddb-425d-b7b2-fdbc62c00c2b","block_type":"box","text":"contingent upon whether the Municipal Market Data AAA General Obligation Scale is above or below a","page_number":163,"box":{"x":116,"y":614,"width":769,"height":12}},{"id":"cea66d8b-80b3-4226-94e3-a7c91d88313f","block_type":"box","text":"specified level on the expiration date of the contract. For example, if a Fund buys an MMD Swap and","page_number":163,"box":{"x":116,"y":630,"width":754,"height":12}},{"id":"e4a0ac43-003e-4b30-912f-2f9f1f2701ec","block_type":"box","text":"the Municipal Market Data AAA General Obligation Scale is below the specified level on the expiration","page_number":163,"box":{"x":116,"y":645,"width":763,"height":12}},{"id":"05caeee8-04d8-4144-8305-670e667be7b7","block_type":"box","text":"date, the counterparty to the contract will make a payment to the Fund equal to the specified level","page_number":163,"box":{"x":116,"y":661,"width":724,"height":12}},{"id":"19cb34a3-28c8-4e5c-ad10-580afc13440d","block_type":"box","text":"minus the actual level, multiplied by the notional amount of the contract. If the Municipal Market Data","page_number":163,"box":{"x":117,"y":676,"width":746,"height":12}},{"id":"5f4a8e64-280f-44d0-a618-3f0be7ff3205","block_type":"box","text":"AAA General Obligation Scale is above the specified level on the expiration date, a Fund will make a","page_number":163,"box":{"x":116,"y":692,"width":746,"height":12}},{"id":"799f6c3f-a8da-4d97-8a57-54109fd698cc","block_type":"box","text":"payment to the counterparty equal to the actual level minus the specified level, multiplied by the","page_number":163,"box":{"x":117,"y":707,"width":708,"height":12}},{"id":"be92f29b-6b87-4ab5-bfe9-cc331bf4ca45","block_type":"box","text":"notional amount of the contract.","page_number":163,"box":{"x":117,"y":723,"width":233,"height":9}},{"id":"78e0cc46-2960-4212-8413-3093653944b9","block_type":"box","text":"In connection with investments in SIFMA and MMD Swaps,","page_number":163,"box":{"x":117,"y":754,"width":438,"height":12}},{"id":"6b72faae-928d-4677-a733-b33bb5136404","block_type":"box","text":"there is a risk that municipal yields will","page_number":163,"box":{"x":561,"y":754,"width":283,"height":12}},{"id":"6669ba43-a16b-479d-9fd8-ff7747438662","block_type":"box","text":"move in the opposite direction than anticipated by a Fund, which would cause the Fund to make","page_number":163,"box":{"x":117,"y":769,"width":711,"height":12}},{"id":"393938b7-866d-4943-b6ab-f813f165c658","block_type":"box","text":"payments to its counterparty in the transaction that could adversely affect the Fund’s performance.","page_number":163,"box":{"x":117,"y":785,"width":729,"height":12}},{"id":"8524e5e9-e69d-47d7-8471-cfc94b416c9f","block_type":"box","text":"Insured Municipal Bonds.","page_number":163,"box":{"x":117,"y":816,"width":186,"height":12}},{"id":"b3927dae-fc28-47c7-9b65-6b456b9a1938","block_type":"box","text":"Bonds purchased by a Fund may be covered by insurance that guarantees","page_number":163,"box":{"x":310,"y":816,"width":555,"height":12}},{"id":"609d3b79-5582-4c9f-bfb3-4ff2b8428d32","block_type":"box","text":"that interest payments on the bond will be made on time and the principal will be repaid when the bond","page_number":163,"box":{"x":116,"y":831,"width":768,"height":12}},{"id":"21e00e2f-aded-4ab2-b6df-520e6384669f","block_type":"box","text":"matures. Either the issuer of the bond or the Fund purchases the insurance. Insurance is expected to","page_number":163,"box":{"x":117,"y":847,"width":755,"height":12}},{"id":"30313d72-f8d8-4817-9285-cca5dc10c7c3","block_type":"box","text":"protect the Fund against losses caused by a bond issuer’s failure to make interest or principal","page_number":163,"box":{"x":117,"y":862,"width":699,"height":12}},{"id":"7f0ff700-b308-43ac-9b3b-e78332314d39","block_type":"box","text":"payments. However, insurance does not protect the Fund or its shareholders against losses caused by","page_number":163,"box":{"x":117,"y":878,"width":767,"height":12}},{"id":"6fad6542-4c76-4909-9cfa-b80f4efc08a2","block_type":"box","text":"II-79","page_number":163,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"f81f121f-e4b4-4858-a997-7feace0f6b28","block_type":"box","text":"NM0926U-5926888-163/257","page_number":163,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"da17e3c4-c13f-4add-9b39-881b44881808","block_type":"box","text":"declines in a bond’s market value. Also, the Fund cannot be certain that any insurance company does","page_number":164,"box":{"x":116,"y":87,"width":761,"height":12}},{"id":"df4228f9-8ee3-4655-8871-b0fb52e36b46","block_type":"box","text":"not make these payments. In addition, if the Fund purchases the insurance, it may pay the premiums,","page_number":164,"box":{"x":117,"y":102,"width":758,"height":13}},{"id":"3aec2e2b-4178-4fb9-aa84-e5d51e1d29ea","block_type":"box","text":"which will reduce the Fund’s yield. The Fund seeks to use only insurance companies with claims","page_number":164,"box":{"x":116,"y":118,"width":721,"height":12}},{"id":"c830feeb-0a55-4da9-89ed-5c7416ccd171","block_type":"box","text":"paying ability, financial strength, or equivalent ratings of at least investment grade. However, if","page_number":164,"box":{"x":117,"y":134,"width":703,"height":12}},{"id":"87453ed1-ddd3-4c6a-97d4-8cdf1d1dd53e","block_type":"box","text":"insurance from insurers with these ratings is not available, the Fund may use insurance companies","page_number":164,"box":{"x":117,"y":149,"width":739,"height":12}},{"id":"23da2def-371a-4b79-a933-b6cca2922f7b","block_type":"box","text":"with lower ratings or stop purchasing insurance or insured bonds. If a bond’s insurer fails to fulfill its","page_number":164,"box":{"x":116,"y":165,"width":742,"height":12}},{"id":"721c3368-be31-4654-93cc-7ea20d2ff95b","block_type":"box","text":"obligations or loses its credit rating, the value of the bond could drop.","page_number":164,"box":{"x":116,"y":180,"width":517,"height":12}},{"id":"f22a51f9-b712-404a-a377-4d461c089f31","block_type":"box","text":"Build America Bonds.","page_number":164,"box":{"x":116,"y":211,"width":159,"height":10}},{"id":"743f1234-9af4-49d2-b95f-9b784881ef29","block_type":"box","text":"If a Fund holds Build America Bonds, the Fund may be eligible to receive a U.S.","page_number":164,"box":{"x":276,"y":211,"width":604,"height":12}},{"id":"613b5f4c-7d4a-46fb-8932-10c68f1c3555","block_type":"box","text":"federal income tax credit; however, the issuer of a Build America Bond may instead elect to receive a","page_number":164,"box":{"x":116,"y":227,"width":756,"height":12}},{"id":"772c72e1-10f2-490f-86fd-954f5c5b2130","block_type":"box","text":"cash payment directly from the federal government in lieu of holders such as the fund receiving a tax","page_number":164,"box":{"x":116,"y":242,"width":752,"height":12}},{"id":"96a3a050-056b-4a75-ade3-49fd0b256b24","block_type":"box","text":"credit. The interest on Build America Bonds is taxable for U.S. federal income tax purposes. If the Fund","page_number":164,"box":{"x":116,"y":258,"width":772,"height":11}},{"id":"0eab9fed-2fe6-4f50-88f0-d5327ee06534","block_type":"box","text":"does receive tax credits from Build America Bonds or other tax credit bonds on one or more specified","page_number":164,"box":{"x":116,"y":273,"width":757,"height":12}},{"id":"ffcb3434-1d9e-43a7-afd1-d3b8346a3854","block_type":"box","text":"dates during the fund’s taxable year, and the Fund satisfies the minimum distribution requirement, the","page_number":164,"box":{"x":116,"y":289,"width":760,"height":12}},{"id":"265f6c0c-ffb4-4ad0-b09c-c8b64ad47074","block_type":"box","text":"Fund may elect for U.S. federal income tax purposes to pass through to shareholders tax credits","page_number":164,"box":{"x":117,"y":304,"width":719,"height":12}},{"id":"15b218f6-c43b-4916-9405-40cc08c6e769","block_type":"box","text":"otherwise allowable to the Fund for that year with respect to such bonds. A tax credit bond is defined in","page_number":164,"box":{"x":116,"y":320,"width":770,"height":12}},{"id":"af5c305f-ee1f-40bf-8c63-02977abab19d","block_type":"box","text":"the Code as a “qualified tax credit bond” (which includes a qualified forestry conservation bond, a new","page_number":164,"box":{"x":116,"y":335,"width":761,"height":12}},{"id":"67064ae4-f482-419d-994b-6e6238c7315a","block_type":"box","text":"clean renewable energy bond, a qualified energy conservation bond, or a qualified zone academy","page_number":164,"box":{"x":116,"y":351,"width":729,"height":12}},{"id":"67ffb31e-95c8-4a39-8ed3-fa53e8750f66","block_type":"box","text":"bond, each of which must meet certain requirements specified in the Code), a “Build America Bond”","page_number":164,"box":{"x":117,"y":366,"width":744,"height":12}},{"id":"fb0301ad-8e9a-4cb0-b5c4-78386f694f18","block_type":"box","text":"(which includes certain qualified bonds issued before January 1, 2011) or certain other specified","page_number":164,"box":{"x":117,"y":382,"width":717,"height":12}},{"id":"6b6b2762-a34c-4d9f-a2cd-5821405de047","block_type":"box","text":"bonds. If the Fund were to so elect, a shareholder would be required to include in income and would be","page_number":164,"box":{"x":117,"y":397,"width":771,"height":12}},{"id":"cce4b1df-512b-42e7-a81e-537ecd6aca48","block_type":"box","text":"entitled to claim as a tax credit an amount equal to a proportionate share of such credits, and such","page_number":164,"box":{"x":116,"y":413,"width":735,"height":12}},{"id":"30548c1b-e8cd-4145-8368-74935836182f","block_type":"box","text":"amount would be subject to withholding provisions of the Code. Certain limitations may apply on the","page_number":164,"box":{"x":116,"y":428,"width":746,"height":12}},{"id":"78694420-df11-4d84-9f4b-e234bc45f9b9","block_type":"box","text":"extent to which the credit may be claimed.","page_number":164,"box":{"x":116,"y":444,"width":318,"height":12}},{"id":"2ca0c549-5f4d-40d5-811f-7a57eda2d956","block_type":"box","text":"Tax-Exempt Municipal Investments.","page_number":164,"box":{"x":118,"y":475,"width":263,"height":12}},{"id":"f7ef4ba2-4dcb-4096-9c6f-1d52cf6b0def","block_type":"box","text":"Certain Funds may hold tax-exempt municipal investments which","page_number":164,"box":{"x":382,"y":475,"width":494,"height":12}},{"id":"01ee836a-0ea7-4a74-9305-ae05d6e55af3","block_type":"box","text":"may be in the form of tender option bonds, variable rate demand obligations, participations, beneficial","page_number":164,"box":{"x":117,"y":490,"width":757,"height":12}},{"id":"ac621e06-1194-400a-9193-ac2d3fcb3985","block_type":"box","text":"interests in a trust, partnership interests or other forms. These investments are described in greater","page_number":164,"box":{"x":117,"y":506,"width":741,"height":12}},{"id":"a68aee89-1eaf-42ee-9bbf-e620c1aa6db8","block_type":"box","text":"detail above in this section. Some of the structures used by certain Funds include interests in long-term","page_number":164,"box":{"x":116,"y":521,"width":771,"height":12}},{"id":"91ad9f55-31ba-4694-a5d3-411a76d56ffd","block_type":"box","text":"fixed-rate municipal debt obligations, held by a trustee or custodian, that are coupled with tender","page_number":164,"box":{"x":116,"y":537,"width":720,"height":12}},{"id":"b9523295-9049-46ad-b74f-e9d6601c7e40","block_type":"box","text":"option, demand and other features when the tax-exempt municipal investments are created. Together,","page_number":164,"box":{"x":116,"y":552,"width":764,"height":12}},{"id":"e1461eec-3331-4028-b55a-1b7d324291ed","block_type":"box","text":"these features entitle the holder of the interest to tender (or put) the underlying municipal debt","page_number":164,"box":{"x":116,"y":568,"width":701,"height":12}},{"id":"fe76d384-b4b7-4738-b19b-420c626f0e16","block_type":"box","text":"obligation to a third party at periodic intervals and to receive the principal amount thereof.","page_number":164,"box":{"x":116,"y":583,"width":667,"height":12}},{"id":"05673031-c493-4165-a76d-c86308653678","block_type":"box","text":"In some cases, municipal debt obligations are represented by custodial receipts evidencing rights to","page_number":164,"box":{"x":117,"y":614,"width":745,"height":12}},{"id":"d6b5cc39-6c7f-4d13-9c6b-961b13e7052a","block_type":"box","text":"receive specific future interest payments, principal payments, or both, on the underlying securities held","page_number":164,"box":{"x":117,"y":630,"width":766,"height":12}},{"id":"28e7a771-376d-499c-b164-12b99b02b1fc","block_type":"box","text":"by the custodian. Under such arrangements, the holder of the custodial receipt has the option to tender","page_number":164,"box":{"x":117,"y":645,"width":769,"height":12}},{"id":"2c42f43c-d994-492b-b5d6-73e852d4751b","block_type":"box","text":"the underlying securities at their face value to the sponsor (","page_number":164,"box":{"x":116,"y":661,"width":440,"height":12}},{"id":"251cf30d-9e4f-46a3-9e88-5e1e70a38475","block_type":"box","text":"e.g.","page_number":164,"box":{"x":557,"y":663,"width":26,"height":10}},{"id":"97ddd5b0-bd9e-45cb-badb-e10c3e4b11df","block_type":"box","text":", a Fund, or a bank or broker-dealer or","page_number":164,"box":{"x":586,"y":661,"width":284,"height":11}},{"id":"0c1779d5-83e2-45c4-b7a2-25873f5b1e12","block_type":"box","text":"other financial institution), which is paid periodic fees equal to the difference between the securities’","page_number":164,"box":{"x":116,"y":676,"width":738,"height":12}},{"id":"f9b3267d-04db-49a8-8aff-22e213580fcf","block_type":"box","text":"fixed coupon rate and the rate that would cause the securities, coupled with the tender option, to trade","page_number":164,"box":{"x":116,"y":692,"width":758,"height":12}},{"id":"825c6f81-ef7d-47d1-948c-a18b7615e450","block_type":"box","text":"at par on the date of a rate adjustment.","page_number":164,"box":{"x":116,"y":707,"width":289,"height":12}},{"id":"69449fdc-7aed-4baf-847b-f59bf0497098","block_type":"box","text":"A participation interest gives the Fund an undivided interest in a Municipal Bond in the proportion the","page_number":164,"box":{"x":116,"y":738,"width":747,"height":12}},{"id":"94811f1c-39b7-47f3-8f01-8975e5609a0c","block_type":"box","text":"Fund’s participation bears to the total principal amount of the Municipal Bond, and typically provides for","page_number":164,"box":{"x":117,"y":754,"width":764,"height":12}},{"id":"4f8d70f9-5c39-4213-9061-8c3db64f98ee","block_type":"box","text":"a repurchase feature for all or any part of the full principal amount of the participation interest, plus","page_number":164,"box":{"x":116,"y":769,"width":729,"height":12}},{"id":"14e27b5c-f0d4-4b04-8268-9f28096be11e","block_type":"box","text":"accrued interest. Trusts and partnerships are typically used to convert long-term fixed rate high quality","page_number":164,"box":{"x":116,"y":785,"width":759,"height":12}},{"id":"ef7cabc5-85f5-4cfe-b7d8-2bbf57664ae7","block_type":"box","text":"bonds of a single state or municipal issuer into variable or floating rate demand instruments.","page_number":164,"box":{"x":117,"y":800,"width":680,"height":12}},{"id":"3ded54f0-ed91-4f46-9ad7-450f273ac5fe","block_type":"box","text":"The Municipal Bond Funds may hold participation interests and custodial receipts for municipal debt","page_number":164,"box":{"x":116,"y":831,"width":746,"height":12}},{"id":"cdd85980-6f06-49bf-9ec1-55cccfc8a838","block_type":"box","text":"obligations which give the holder the right to receive payment of principal subject to the conditions","page_number":164,"box":{"x":116,"y":847,"width":731,"height":12}},{"id":"dc589e97-3481-47d3-ae62-cf49d0de9954","block_type":"box","text":"described above. The IRS has not ruled on whether the interest received on tax-exempt municipal","page_number":164,"box":{"x":116,"y":862,"width":732,"height":12}},{"id":"5b252a90-46d5-4a3f-a39a-9e7132724e3b","block_type":"box","text":"investments in the form of participation interests or custodial receipts is tax-exempt, and accordingly,","page_number":164,"box":{"x":117,"y":878,"width":751,"height":12}},{"id":"7bf89c4a-3a63-43b6-9b99-cfa2ef4117dc","block_type":"box","text":"II-80","page_number":164,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"f263c1ba-2900-4023-af8d-86b81cee09ae","block_type":"box","text":"NM0926U-5926888-164/257","page_number":164,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"5fe43751-5f60-4482-8320-aedd512ca5d2","block_type":"box","text":"purchases of any such interests or receipts are based on the opinions of counsel to the sponsors of","page_number":165,"box":{"x":117,"y":87,"width":742,"height":12}},{"id":"8febb811-23cd-4de2-8d31-721cc85b2d6a","block_type":"box","text":"such derivative securities. Neither a Fund nor its investment adviser or sub-advisers will review the","page_number":165,"box":{"x":116,"y":103,"width":738,"height":9}},{"id":"fa98437d-78fe-4706-ba09-e9be32774f35","block_type":"box","text":"proceedings related to the creation of any tax-exempt municipal investments or the basis for such","page_number":165,"box":{"x":117,"y":118,"width":728,"height":12}},{"id":"1d683c3c-8eee-425e-ae67-60a1f8d1cba7","block_type":"box","text":"opinions.","page_number":165,"box":{"x":116,"y":134,"width":72,"height":11}},{"id":"1e5b45d4-4b23-4889-a4f1-4f84e1957e47","block_type":"box","text":"Operational and Technology Risks.","page_number":165,"box":{"x":117,"y":165,"width":279,"height":12}},{"id":"5328912d-7fd0-4380-93a9-5932499aa9a6","block_type":"box","text":"The Fund and the entities with which it interacts directly or","page_number":165,"box":{"x":397,"y":165,"width":442,"height":12}},{"id":"9df447ba-5222-42ae-9e56-9e5043402510","block_type":"box","text":"indirectly are susceptible to operational and technology risks, including those related to human errors,","page_number":165,"box":{"x":117,"y":180,"width":758,"height":12}},{"id":"f350bfe5-cd79-4ee4-acec-904dbfb7c97c","block_type":"box","text":"processing errors, communication errors, systems failures, cybersecurity incidents, and the use of","page_number":165,"box":{"x":117,"y":196,"width":731,"height":12}},{"id":"4c81e53f-57ae-46a3-963a-698765e1a5c0","block_type":"box","text":"artificial intelligence and machine learning (“AI”), which may result in losses for the Fund and its","page_number":165,"box":{"x":116,"y":211,"width":713,"height":12}},{"id":"13dfcbaa-def0-496b-8522-1736520e1100","block_type":"box","text":"shareholders or impair the Fund’s operations. These entities include, but are not limited to, the Fund’s","page_number":165,"box":{"x":116,"y":227,"width":760,"height":11}},{"id":"778070be-dee4-42e3-90aa-aa86295da02d","block_type":"box","text":"adviser, administrator, distributor, other service providers (e.g., index and benchmark providers,","page_number":165,"box":{"x":116,"y":242,"width":716,"height":12}},{"id":"ec16e815-c34a-4d21-8281-372d8c9dfe80","block_type":"box","text":"accountants, custodians, and transfer agents), financial intermediaries, counterparties, market makers,","page_number":165,"box":{"x":116,"y":258,"width":768,"height":12}},{"id":"004c2353-aa42-4ee2-a7f4-6cf3a9c8f09b","block_type":"box","text":"Authorized Participants, listing exchanges, other financial market operators, and governmental","page_number":165,"box":{"x":116,"y":273,"width":706,"height":12}},{"id":"63f97673-2194-4791-97c1-6e360cab3db4","block_type":"box","text":"authorities, as applicable. Operational and technology risks for the issuers in which the Fund invests","page_number":165,"box":{"x":116,"y":289,"width":748,"height":12}},{"id":"8c900aee-5085-41b2-86c6-2fb89e705f68","block_type":"box","text":"could also result in material adverse consequences for such issuers and may cause the Fund’s","page_number":165,"box":{"x":116,"y":304,"width":711,"height":12}},{"id":"18c67d9e-587b-485c-bffb-d9100085eaf4","block_type":"box","text":"investments in such issuers to lose value. The Fund may incur substantial costs in order to mitigate","page_number":165,"box":{"x":117,"y":320,"width":741,"height":12}},{"id":"01278fd9-18ed-43fa-b653-171b1c1075ba","block_type":"box","text":"operational and technology risks.","page_number":165,"box":{"x":116,"y":335,"width":250,"height":12}},{"id":"058ec2d5-1a25-40bb-893e-a0cc5db935fb","block_type":"box","text":"Cybersecurity incidents can result from deliberate attacks or unintentional events against an issuer in","page_number":165,"box":{"x":117,"y":366,"width":754,"height":12}},{"id":"01a04af5-27bb-4306-b689-404cbe719b51","block_type":"box","text":"which the Fund invests, the Fund or any of its service providers. They include, but are not limited to,","page_number":165,"box":{"x":116,"y":382,"width":746,"height":12}},{"id":"3fbba7cd-9f7b-4ce2-bba3-2cc6862f19d9","block_type":"box","text":"gaining unauthorized access to systems, misappropriating assets or sensitive information, corrupting or","page_number":165,"box":{"x":116,"y":397,"width":772,"height":12}},{"id":"d2f95439-b430-495f-8c0e-04511e8de545","block_type":"box","text":"destroying data, and causing operational disruption. Geopolitical tension may increase the scale and","page_number":165,"box":{"x":116,"y":413,"width":751,"height":12}},{"id":"ea8f4ea4-1082-4dd5-9537-baf9cd18f0d0","block_type":"box","text":"sophistication of deliberate attacks, particularly those from nation states or from entities with nation","page_number":165,"box":{"x":116,"y":428,"width":738,"height":12}},{"id":"04217161-9858-4ee3-8243-8368e249e283","block_type":"box","text":"state backing. Cybersecurity incidents may result in any of the following: financial losses; interference","page_number":165,"box":{"x":116,"y":444,"width":757,"height":12}},{"id":"ddf44522-31a9-44c4-8186-e59c0a50c7b0","block_type":"box","text":"with the Fund’s ability to calculate its NAV; disclosure of confidential information; impediments to","page_number":165,"box":{"x":116,"y":459,"width":721,"height":12}},{"id":"4a73d4e1-c70f-41f0-84bf-ee336b5dd83c","block_type":"box","text":"trading; submission of erroneous trades by the Fund or erroneous subscription or redemption orders;","page_number":165,"box":{"x":116,"y":475,"width":754,"height":12}},{"id":"3b183ec5-aa12-44d1-8d19-a05a9120f270","block_type":"box","text":"the inability of the Fund or its service providers to transact business; violations of applicable privacy","page_number":165,"box":{"x":116,"y":490,"width":743,"height":12}},{"id":"dfd1dbf3-66a8-4fb6-bc41-2f403f347832","block_type":"box","text":"and other laws; regulatory fines; penalties; reputational damage; reimbursement or other compensation","page_number":165,"box":{"x":116,"y":506,"width":772,"height":12}},{"id":"7b48aa4a-d1c4-46b6-a27e-ddf863354f82","block_type":"box","text":"costs; and other legal and compliance expenses. Furthermore, cybersecurity incidents may render","page_number":165,"box":{"x":116,"y":521,"width":735,"height":12}},{"id":"aa2ec6b6-02d9-4400-950f-dbd2c449b4cb","block_type":"box","text":"records of the Fund, including records relating to its assets and transactions, shareholder ownership of","page_number":165,"box":{"x":117,"y":537,"width":766,"height":12}},{"id":"8b4b31c0-3439-48e1-914f-23c27a2db80d","block_type":"box","text":"Fund shares, and other data integral to the Fund’s functioning, inaccessible, inaccurate or incomplete.","page_number":165,"box":{"x":117,"y":552,"width":761,"height":12}},{"id":"dd483d28-51b3-448a-bed2-73f52b5940a9","block_type":"box","text":"Power outages, natural disasters, equipment malfunctions and processing errors that threaten","page_number":165,"box":{"x":117,"y":568,"width":702,"height":12}},{"id":"bc88673f-dd87-4058-94e8-4be3e748334f","block_type":"box","text":"information and technology systems relied upon by the Fund or its service providers, as well as market","page_number":165,"box":{"x":117,"y":583,"width":766,"height":12}},{"id":"ac4a26c4-4e68-4864-97b0-de54f62aac67","block_type":"box","text":"events that occur at a pace that overloads these systems, may also disrupt business operations or","page_number":165,"box":{"x":116,"y":599,"width":735,"height":12}},{"id":"5001c92f-7132-456d-8d07-edfe8f1425dc","block_type":"box","text":"impact critical data. Recent advances in AI technology pose risks to the Fund and its portfolio","page_number":165,"box":{"x":117,"y":614,"width":696,"height":12}},{"id":"e24a62b3-2181-470a-a1dd-f41a4dc042ce","block_type":"box","text":"investments. These advancements could harm the Fund and its portfolio investments by reducing the","page_number":165,"box":{"x":117,"y":630,"width":756,"height":12}},{"id":"821c0406-a0b7-41f2-a75b-8bda0f9c3158","block_type":"box","text":"demand for both the technology and software offerings of the Fund’s portfolio investments.","page_number":165,"box":{"x":116,"y":645,"width":677,"height":12}},{"id":"1a78e247-1ed3-4317-9213-26693d8dab7b","block_type":"box","text":"Additionally, these advancements could significantly disrupt the Fund’s portfolio investments and","page_number":165,"box":{"x":116,"y":661,"width":716,"height":12}},{"id":"e62d8625-2b50-41a7-8133-51c51348ba22","block_type":"box","text":"subject them to increased competition, which could have a material adverse effect on business,","page_number":165,"box":{"x":116,"y":676,"width":708,"height":12}},{"id":"05962bea-ed42-44ec-9b7c-7e4707ec1caa","block_type":"box","text":"financial condition, and results of operations. AI technology advancements, including efficiency","page_number":165,"box":{"x":116,"y":692,"width":703,"height":12}},{"id":"46e7134a-842d-4dd6-9720-b837441ec35d","block_type":"box","text":"improvements, without related increases in the adoption and development of such technologies, could","page_number":165,"box":{"x":117,"y":707,"width":755,"height":12}},{"id":"33e81ea5-328b-4c75-a1ae-6788ee1eb2e8","block_type":"box","text":"also negatively impact demand for, and the valuation of, digital infrastructure assets.","page_number":165,"box":{"x":116,"y":723,"width":624,"height":12}},{"id":"1fa56419-a364-401e-ab3b-3105256cd577","block_type":"box","text":"The Fund and its portfolio investments could be exposed to the risks of AI technology if third-party","page_number":165,"box":{"x":116,"y":754,"width":727,"height":12}},{"id":"37365ac1-6211-4342-b921-fcee2610dbe1","block_type":"box","text":"service providers or any counterparties, whether or not known to the Fund, also use AI technology in","page_number":165,"box":{"x":116,"y":769,"width":745,"height":12}},{"id":"8ef9f25e-dc99-4807-986b-22e7c6e42b80","block_type":"box","text":"their business activities. The Fund and its service providers may not be in a position to control the use","page_number":165,"box":{"x":116,"y":785,"width":756,"height":12}},{"id":"1ea821be-5bff-4a5d-b23a-4902dc335826","block_type":"box","text":"of AI technology in third-party products or services.","page_number":165,"box":{"x":116,"y":800,"width":377,"height":12}},{"id":"16164b7a-2c0b-4daa-9052-ca2a5615974d","block_type":"box","text":"Use of AI technology could include the input of confidential information in contravention of applicable","page_number":165,"box":{"x":117,"y":831,"width":750,"height":12}},{"id":"7a8d49be-05d9-41db-80da-0e14f90996ec","block_type":"box","text":"policies, contractual or other obligations or restrictions, resulting in such confidential information","page_number":165,"box":{"x":117,"y":847,"width":713,"height":12}},{"id":"92ba1e64-a3da-412e-80b6-8a4a71343e5b","block_type":"box","text":"becoming accessible by other third-party AI technology applications and users.","page_number":165,"box":{"x":117,"y":862,"width":589,"height":12}},{"id":"6d6dfa74-73c6-4452-8610-fb2840201f37","block_type":"box","text":"II-81","page_number":165,"box":{"x":484,"y":909,"width":29,"height":9}},{"id":"ba7b5014-1a3d-4a12-a834-a1374aad5e70","block_type":"box","text":"NM0926U-5926888-165/257","page_number":165,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"00324bf6-30ac-4cde-b64f-dc8df8e07dcf","block_type":"box","text":"Independent of its context of use, AI technology is generally highly reliant on the collection and","page_number":166,"box":{"x":117,"y":87,"width":706,"height":12}},{"id":"e2227e94-941e-44c0-8c8e-d3f77263811a","block_type":"box","text":"analysis of large amounts of data, may incorporate biased or inaccurate data, and it is not possible or","page_number":166,"box":{"x":116,"y":102,"width":757,"height":13}},{"id":"3b8e7e95-f311-4988-9a47-c0e97fa3ba86","block_type":"box","text":"practicable to incorporate all relevant data into the models that AI technology utilizes to operate.","page_number":166,"box":{"x":117,"y":118,"width":715,"height":12}},{"id":"8f8492cf-3ff1-418d-91bc-17dde6fb4991","block_type":"box","text":"Certain data in such models will inevitably contain a degree of inaccuracy and error, or could otherwise","page_number":166,"box":{"x":117,"y":134,"width":768,"height":12}},{"id":"8dda16bc-9a70-4f7b-aba2-3c32a1c045c9","block_type":"box","text":"be inadequate or flawed, which would be likely to degrade the effectiveness of AI technology. The","page_number":166,"box":{"x":117,"y":149,"width":729,"height":12}},{"id":"5039cba4-e018-462a-83dc-215b8715f0f9","block_type":"box","text":"output or results of any such AI technologies may therefore be incomplete, erroneous, distorted or","page_number":166,"box":{"x":116,"y":165,"width":733,"height":12}},{"id":"43184098-ff9d-43d5-8b63-1d44d7056d27","block_type":"box","text":"misleading. Further, AI tools may lack transparency as to how data is utilized and how outputs are","page_number":166,"box":{"x":117,"y":180,"width":731,"height":12}},{"id":"fa567fab-0c02-4b5b-b918-994f80925001","block_type":"box","text":"generated. AI technologies may also allow the unintended introduction of vulnerabilities into","page_number":166,"box":{"x":116,"y":196,"width":684,"height":12}},{"id":"1ea49693-6ee8-420e-84b1-681d25783b2e","block_type":"box","text":"infrastructures and applications. To the extent that the Fund or its portfolio investments are exposed to","page_number":166,"box":{"x":117,"y":211,"width":764,"height":12}},{"id":"dc322edb-4509-43f8-ace5-d106fcd264ad","block_type":"box","text":"the risks of AI technology use, any such inaccuracies or errors could have adverse impacts on the","page_number":166,"box":{"x":116,"y":227,"width":732,"height":12}},{"id":"21e2f3e6-312d-41c4-b143-46d1ecca4b30","block_type":"box","text":"Fund or its investments.","page_number":166,"box":{"x":117,"y":242,"width":182,"height":10}},{"id":"61db0aa3-f9ef-4342-9474-76a9a4a1a254","block_type":"box","text":"Regulations related to AI technology could also impose certain obligations and costs related to","page_number":166,"box":{"x":117,"y":273,"width":705,"height":12}},{"id":"99541662-514e-4ad2-bd84-dc7013b97a96","block_type":"box","text":"monitoring and compliance. For example, in April 2023, the Federal Trade Commission, U.S.","page_number":166,"box":{"x":117,"y":289,"width":693,"height":12}},{"id":"74c3af3b-2164-4414-8698-cbc291cd6b9f","block_type":"box","text":"Department of Justice, Consumer Financial Protection Bureau, and U.S. Equal Employment","page_number":166,"box":{"x":117,"y":304,"width":686,"height":12}},{"id":"6ee393db-ae39-4dfe-b68a-217a8cf5e779","block_type":"box","text":"Opportunity Commission released a joint statement on artificial intelligence demonstrating interest in","page_number":166,"box":{"x":116,"y":320,"width":749,"height":12}},{"id":"371a5f04-b72e-4f2a-9112-01d1360826e3","block_type":"box","text":"monitoring the development and use of automated systems and enforcement of their respective laws","page_number":166,"box":{"x":117,"y":335,"width":752,"height":12}},{"id":"89a5b205-c82d-4a8e-84be-735df4c32bf5","block_type":"box","text":"and regulations. In October 2023, an executive order established new standards for AI safety and","page_number":166,"box":{"x":116,"y":351,"width":729,"height":12}},{"id":"8754f9c4-4f78-46ea-bdb0-11258d90267d","block_type":"box","text":"security. In addition to the U.S. regulatory framework, in 2024, the EU adopted the Artificial Intelligence","page_number":166,"box":{"x":116,"y":366,"width":769,"height":12}},{"id":"e53b6716-fd6e-4d6f-b181-c4f5a4f8965e","block_type":"box","text":"Act, which applies to certain AI technology and the","page_number":166,"box":{"x":116,"y":382,"width":380,"height":12}},{"id":"2fa1fa41-d8da-4d22-bfb0-abdb0c5b1324","block_type":"box","text":"data used to train, test, and deploy them, which","page_number":166,"box":{"x":497,"y":382,"width":357,"height":12}},{"id":"4205fe27-2404-466f-9785-66de2bbaec40","block_type":"box","text":"may create additional compliance burdens, higher administrative costs, and significant penalties should","page_number":166,"box":{"x":117,"y":397,"width":770,"height":12}},{"id":"c39a646a-e2ff-46b9-a08a-366d8525b68d","block_type":"box","text":"the Fund, the adviser, or the Fund’s portfolio investments fail to comply.","page_number":166,"box":{"x":116,"y":413,"width":537,"height":12}},{"id":"5fe565be-187c-43fa-9e2b-cebb3bb2cbab","block_type":"box","text":"AI technology and its applications, including in the investment and financial sectors, continue to","page_number":166,"box":{"x":116,"y":444,"width":711,"height":12}},{"id":"dbffc4d5-d0ae-416c-b7e9-577747d1eb64","block_type":"box","text":"develop rapidly, and it is impossible to predict the future risks that may arise from such developments.","page_number":166,"box":{"x":116,"y":459,"width":762,"height":12}},{"id":"4dd73046-0f9c-424d-8c52-a573fa5b8a50","block_type":"box","text":"The full extent of current or future risks related thereto is not possible to predict, and the Fund may not","page_number":166,"box":{"x":116,"y":475,"width":765,"height":12}},{"id":"71a2a7b8-655b-4bef-932a-6b2bd05231c8","block_type":"box","text":"be able to anticipate, prevent, mitigate, or remediate all of the potential risks, challenges, or impacts of","page_number":166,"box":{"x":117,"y":490,"width":763,"height":12}},{"id":"738e7809-bbfa-4584-a441-3a9667b66638","block_type":"box","text":"such changes.","page_number":166,"box":{"x":116,"y":506,"width":113,"height":12}},{"id":"7e29d002-73e3-43d7-a57d-4b5365723ed4","block_type":"box","text":"While the Fund’s service providers are required to have appropriate operational, information security","page_number":166,"box":{"x":116,"y":537,"width":750,"height":12}},{"id":"d3c53b5a-fb9c-4d28-aed9-d4627a595848","block_type":"box","text":"and cybersecurity risk management policies and procedures, their methods of risk management may","page_number":166,"box":{"x":116,"y":552,"width":753,"height":12}},{"id":"089cecd7-22c3-4bf9-9118-308f9bbccc06","block_type":"box","text":"differ from those of the Fund in the setting of priorities, the personnel and resources available or the","page_number":166,"box":{"x":116,"y":568,"width":745,"height":12}},{"id":"9a968090-2651-4637-aecb-83b0a5c3079c","block_type":"box","text":"effectiveness of relevant controls. The Fund and its adviser seek to reduce these risks through","page_number":166,"box":{"x":116,"y":583,"width":706,"height":12}},{"id":"5975b5ed-1f65-471b-8abf-5a659a83a4dc","block_type":"box","text":"controls, procedures and oversight, including establishing business continuity plans and risk","page_number":166,"box":{"x":116,"y":599,"width":687,"height":12}},{"id":"ffaf2e27-414b-4200-bdea-b7b55589e659","block_type":"box","text":"management systems. However, there are inherent limitations in such plans and systems, including","page_number":166,"box":{"x":117,"y":614,"width":744,"height":12}},{"id":"61f6f3bd-3583-472e-b0b4-c59062fa33c4","block_type":"box","text":"the possibility that certain risks that may affect the Fund have not been identified or may emerge in the","page_number":166,"box":{"x":116,"y":630,"width":766,"height":12}},{"id":"f1e2534d-2145-4f8b-ac47-557268c29cb5","block_type":"box","text":"future; that such plans and systems may not completely eliminate the occurrence or mitigate the","page_number":166,"box":{"x":116,"y":645,"width":719,"height":12}},{"id":"8e34a4d1-2ab5-4716-af60-ae581d240e70","block_type":"box","text":"effects of operational or information security disruptions or failures or of cybersecurity incidents; or that","page_number":166,"box":{"x":116,"y":661,"width":761,"height":12}},{"id":"393ef645-0870-4354-97e2-9b1d2a09a6cf","block_type":"box","text":"prevention and remediation efforts will not be successful or that incidents will go undetected. The Fund","page_number":166,"box":{"x":117,"y":676,"width":760,"height":12}},{"id":"b69c9420-6613-4564-a9fd-d0c075e20fa6","block_type":"box","text":"cannot control the systems, information security or other cybersecurity of the issuers in which it invests","page_number":166,"box":{"x":116,"y":692,"width":762,"height":12}},{"id":"6be7190d-f194-4b44-80e2-afce0df55407","block_type":"box","text":"or its service providers, counterparties, and other third parties whose activities affect the Fund.","page_number":166,"box":{"x":116,"y":707,"width":700,"height":12}},{"id":"d6c6be74-96e2-4c8b-8afd-3f7619d8efda","block_type":"box","text":"Lastly, the regulatory climate governing cybersecurity and data protection is developing quickly and","page_number":166,"box":{"x":117,"y":738,"width":735,"height":12}},{"id":"c89f1cbd-7083-460a-95f3-b9cd0f04f925","block_type":"box","text":"may vary considerably across jurisdictions. Regulators continue to develop new rules and standards","page_number":166,"box":{"x":117,"y":754,"width":742,"height":12}},{"id":"211b9ac3-4716-47fe-926d-abd0277b13db","block_type":"box","text":"related to cybersecurity and data protection. Compliance with evolving regulations can be demanding","page_number":166,"box":{"x":117,"y":769,"width":750,"height":12}},{"id":"4224c915-b5d7-4dfa-aed6-4bb57e9469a4","block_type":"box","text":"and costly, requiring substantial resources to monitor and implement required changes.","page_number":166,"box":{"x":116,"y":785,"width":647,"height":12}},{"id":"6a82abae-ab60-445d-84d6-f525f52b68fc","block_type":"box","text":"Participation Notes.","page_number":166,"box":{"x":116,"y":816,"width":157,"height":12}},{"id":"16a88d50-f93f-442b-a1e5-de982f6cc0f2","block_type":"box","text":"A Fund may buy participation notes from a bank or broker-dealer (“issuer”) that","page_number":166,"box":{"x":279,"y":816,"width":586,"height":12}},{"id":"834e6308-871a-4f2a-9afe-8f6bb46bd830","block_type":"box","text":"entitle the Fund to a return measured by the change in value of an identified underlying security or","page_number":166,"box":{"x":116,"y":831,"width":733,"height":12}},{"id":"56fcaf50-4304-4bd3-a808-f484a9c1d843","block_type":"box","text":"basket of securities (collectively, the “underlying security”). Participation notes are typically used when","page_number":166,"box":{"x":117,"y":847,"width":761,"height":12}},{"id":"7b2779ee-3310-439c-b433-de9785d73c21","block_type":"box","text":"a direct investment in the underlying security is restricted due to country-specific regulations.","page_number":166,"box":{"x":116,"y":862,"width":692,"height":12}},{"id":"d4d6a4b9-188f-4114-a917-7a168193aee2","block_type":"box","text":"II-82","page_number":166,"box":{"x":484,"y":909,"width":31,"height":9}},{"id":"94442b44-3303-40ff-be46-1fbfc41e37cb","block_type":"box","text":"NM0926U-5926888-166/257","page_number":166,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"ed7e9fdb-cbb1-4b5e-baf7-b791cfbd1df8","block_type":"box","text":"The Fund is subject to counterparty risk associated with each issuer. Investment in a participation note","page_number":167,"box":{"x":116,"y":87,"width":766,"height":12}},{"id":"888b31b3-32df-4565-b27b-c700f002e01c","block_type":"box","text":"is not the same as investment in the constituent shares of the company. A participation note represents","page_number":167,"box":{"x":117,"y":102,"width":771,"height":13}},{"id":"428f4aca-899a-4941-9ac3-844f29c07bbc","block_type":"box","text":"only an obligation of the issuer to provide the Fund the economic performance equivalent to holding","page_number":167,"box":{"x":116,"y":118,"width":744,"height":12}},{"id":"493076a8-e299-46b3-ada9-a67da707618e","block_type":"box","text":"shares of an underlying security. A participation note does not provide any beneficial or equitable","page_number":167,"box":{"x":116,"y":134,"width":725,"height":12}},{"id":"6be08e01-d904-4601-9066-93722e823069","block_type":"box","text":"entitlement or interest in the relevant underlying security. In other words, shares of the underlying","page_number":167,"box":{"x":116,"y":149,"width":727,"height":12}},{"id":"b5b8f09d-3b3e-4c38-b378-0bdd378920d0","block_type":"box","text":"security are not in any way owned by the Fund. However, each participation note synthetically","page_number":167,"box":{"x":116,"y":165,"width":702,"height":12}},{"id":"f3fff6be-a372-4d89-8f04-68effa5dfbe6","block_type":"box","text":"replicates the economic benefit of holding shares in the underlying security. Because a participation","page_number":167,"box":{"x":117,"y":180,"width":743,"height":12}},{"id":"7466709a-d199-4135-936d-51229848f2cc","block_type":"box","text":"note is an obligation of the issuer, rather than a direct investment in shares of the underlying security, a","page_number":167,"box":{"x":117,"y":196,"width":770,"height":12}},{"id":"f4ffe7cc-5647-484e-9eb8-7cbb9e319d51","block_type":"box","text":"Fund may suffer losses potentially equal to the full value of the participation note if the issuer fails to","page_number":167,"box":{"x":117,"y":211,"width":745,"height":12}},{"id":"30801b04-bfe1-4449-9d2c-534268f92fe7","block_type":"box","text":"perform its obligations. A Fund attempts to mitigate that risk by purchasing only from issuers","page_number":167,"box":{"x":117,"y":227,"width":689,"height":12}},{"id":"8ae3710e-f61f-43b3-97ec-ec26c0315359","block_type":"box","text":"determined to be creditworthy.","page_number":167,"box":{"x":116,"y":242,"width":231,"height":12}},{"id":"7a496cff-09e2-445a-b4db-c1c1fbfef3b2","block_type":"box","text":"The counterparty may, but is not required to, purchase the shares of the underlying security to hedge","page_number":167,"box":{"x":116,"y":273,"width":755,"height":12}},{"id":"da45e371-2450-4485-bb18-75535b3c7847","block_type":"box","text":"its obligation. A Fund may, but is not required to, purchase credit protection against the default of the","page_number":167,"box":{"x":117,"y":289,"width":752,"height":12}},{"id":"3152a415-e4b7-4438-b3de-fee3bcf3d935","block_type":"box","text":"issuer. When the participation note expires or a Fund exercises the participation note and closes its","page_number":167,"box":{"x":117,"y":304,"width":742,"height":12}},{"id":"4d068473-2be2-4ee0-b1f0-c6e0dde0fdc3","block_type":"box","text":"position, the Fund receives a payment that is based upon the then-current value of the underlying","page_number":167,"box":{"x":117,"y":320,"width":728,"height":12}},{"id":"d9d36cd3-f450-4bde-94bb-baca4b476e58","block_type":"box","text":"security converted into U.S. dollars (less transaction costs). The price, performance and liquidity of a","page_number":167,"box":{"x":116,"y":335,"width":751,"height":12}},{"id":"abd81238-b054-4eaf-85e7-98e7f0b8cbd0","block_type":"box","text":"participation note are all linked directly to the underlying security. A Fund’s ability to redeem or","page_number":167,"box":{"x":117,"y":351,"width":704,"height":12}},{"id":"6ac59102-9dec-4ea1-942f-38fff1aa095e","block_type":"box","text":"exercise a participation note generally is dependent on the liquidity in the local trading market for the","page_number":167,"box":{"x":116,"y":366,"width":750,"height":12}},{"id":"3dfe8a3a-799f-4a27-aa45-f8b9d1b7c67c","block_type":"box","text":"security underlying the participation note.","page_number":167,"box":{"x":116,"y":382,"width":310,"height":12}},{"id":"958d7161-13d5-4b4e-9be3-3babd9b69756","block_type":"box","text":"Portfolio Turnover Rates.","page_number":167,"box":{"x":116,"y":413,"width":201,"height":9}},{"id":"a0482782-9856-45db-98b1-c6b57405194f","block_type":"box","text":"A Fund’s annual portfolio turnover rate will not be a factor preventing a sale","page_number":167,"box":{"x":318,"y":413,"width":569,"height":12}},{"id":"932f87cd-f5fa-4712-a2e2-7cc132d63240","block_type":"box","text":"or purchase when the Manager believes investment considerations warrant such sale or purchase.","page_number":167,"box":{"x":116,"y":428,"width":738,"height":12}},{"id":"445a53a7-9a0c-43ee-804f-9dfac2f90b76","block_type":"box","text":"Although certain Funds will use an approach to investing that is largely a passive, indexing approach,","page_number":167,"box":{"x":116,"y":444,"width":756,"height":12}},{"id":"d69c22d2-7cfc-4e76-a79b-67ef9d4c31c0","block_type":"box","text":"such Funds may engage in a substantial number of portfolio transactions. With respect to these Funds,","page_number":167,"box":{"x":116,"y":459,"width":770,"height":12}},{"id":"8c638d2e-b561-4b32-a904-6924053e78ec","block_type":"box","text":"the rate of portfolio turnover will be a limiting factor when the Manager considers whether to purchase","page_number":167,"box":{"x":116,"y":475,"width":759,"height":12}},{"id":"6fc87d5a-141f-45dc-9a63-39b8acd9c3fb","block_type":"box","text":"or sell securities for a Fund only to the extent that the Manager will consider the impact of transaction","page_number":167,"box":{"x":116,"y":490,"width":756,"height":12}},{"id":"ab353e68-ff56-4972-b44f-073366c920e2","block_type":"box","text":"costs on a Fund’s tracking error. Portfolio turnover may vary greatly from year to year as well as within","page_number":167,"box":{"x":116,"y":506,"width":765,"height":12}},{"id":"89259225-ed7d-4674-a7a3-fd49053d0f66","block_type":"box","text":"a particular year. High portfolio turnover (","page_number":167,"box":{"x":116,"y":521,"width":305,"height":12}},{"id":"7d98867b-ea03-4fe7-b476-c2cce19d0ffd","block_type":"box","text":"i.e.","page_number":167,"box":{"x":422,"y":521,"width":21,"height":10}},{"id":"1cb693b6-e536-46d9-a969-7a87d7dd5bb9","block_type":"box","text":", 100% or more) may result in increased transaction costs","page_number":167,"box":{"x":446,"y":521,"width":433,"height":12}},{"id":"ae078563-5a12-4402-b63e-d758a29ac609","block_type":"box","text":"to a Fund, including brokerage commissions, dealer mark-ups and other transaction costs on the sale","page_number":167,"box":{"x":116,"y":537,"width":759,"height":12}},{"id":"739fd548-320b-49c4-8623-43ebc4e0fcf5","block_type":"box","text":"of the securities and reinvestment in other securities. The sale of a Fund’s securities may result in the","page_number":167,"box":{"x":116,"y":552,"width":759,"height":12}},{"id":"45b11ebe-9d8d-4b31-a338-997ba2fc4635","block_type":"box","text":"recognition of capital gain or loss. Given the frequency of sales, such gain or loss will likely be short","page_number":167,"box":{"x":117,"y":568,"width":743,"height":12}},{"id":"f5994cef-ac1a-4a7c-bbff-e021674c8fc5","block_type":"box","text":"term capital gain or loss. These effects of higher than normal portfolio turnover may adversely affect a","page_number":167,"box":{"x":116,"y":583,"width":761,"height":12}},{"id":"7bbc15ff-f0c5-41f6-b054-52b77276d5d2","block_type":"box","text":"Fund’s performance.","page_number":167,"box":{"x":117,"y":599,"width":158,"height":12}},{"id":"18079822-4d76-4889-8019-739b979d8292","block_type":"box","text":"Preferred Stock.","page_number":167,"box":{"x":116,"y":630,"width":129,"height":9}},{"id":"a01d2b78-02c3-40bb-91a7-cf4c4a4944e4","block_type":"box","text":"Certain Funds may invest in preferred stocks. Preferred stock has a preference over","page_number":167,"box":{"x":246,"y":630,"width":635,"height":12}},{"id":"e52e48b6-6b65-46ed-9f4e-5a3109fd4104","block_type":"box","text":"common stock in liquidation (and generally dividends as well) but is subordinated to bond holders and","page_number":167,"box":{"x":116,"y":645,"width":760,"height":12}},{"id":"d930962c-8c34-41fa-a369-b788ad094c90","block_type":"box","text":"other creditors in all respects. As a general rule,","page_number":167,"box":{"x":116,"y":661,"width":355,"height":12}},{"id":"4bf1eda9-45c2-4e26-96aa-9ea8181a97f0","block_type":"box","text":"the market value of preferred stock with a fixed","page_number":167,"box":{"x":477,"y":661,"width":348,"height":12}},{"id":"5736cead-9e1a-44d3-9cc6-04f49fd7020a","block_type":"box","text":"dividend rate and no conversion element varies inversely with interest rates and perceived credit risk,","page_number":167,"box":{"x":116,"y":676,"width":750,"height":12}},{"id":"b7ece576-1e05-49cc-849a-fc26efd5b45d","block_type":"box","text":"while the market price of convertible preferred stock generally also reflects some element of","page_number":167,"box":{"x":116,"y":692,"width":682,"height":12}},{"id":"5f64b9f7-0b8f-4f7f-9b95-3244ecb5cddb","block_type":"box","text":"conversion value. Because preferred stock is junior to debt securities and other obligations of the","page_number":167,"box":{"x":116,"y":707,"width":720,"height":12}},{"id":"7825b187-5bbf-44bf-83cd-ca710b2a32a8","block_type":"box","text":"issuer, deterioration in the credit quality of the issuer will cause greater changes in the value of a","page_number":167,"box":{"x":117,"y":723,"width":715,"height":12}},{"id":"5951f611-a403-4704-992d-32b43a31cc4d","block_type":"box","text":"preferred stock than in a more senior debt security with similar stated yield characteristics. Unlike","page_number":167,"box":{"x":117,"y":738,"width":720,"height":12}},{"id":"13ad482f-a641-4954-9c44-6d067d8c3807","block_type":"box","text":"interest payments on debt securities, preferred stock dividends are payable only if declared by the","page_number":167,"box":{"x":117,"y":754,"width":726,"height":12}},{"id":"035322bb-f99d-4a92-947a-f143714e3c53","block_type":"box","text":"issuer’s board of directors. Preferred stock also may be subject to optional or mandatory redemption","page_number":167,"box":{"x":117,"y":769,"width":743,"height":12}},{"id":"ef310d9f-0654-4aab-8951-0e65fcba93af","block_type":"box","text":"provisions.","page_number":167,"box":{"x":117,"y":785,"width":78,"height":12}},{"id":"27495123-28ee-440a-8f86-4b2206001268","block_type":"box","text":"Tax-Exempt Preferred Shares.","page_number":167,"box":{"x":118,"y":816,"width":224,"height":12}},{"id":"6a23e85f-d5f6-4264-af2d-438a2e716891","block_type":"box","text":"Certain Funds may invest in preferred interests of other investment","page_number":167,"box":{"x":350,"y":816,"width":497,"height":12}},{"id":"cba9cfc7-50c5-4b75-a5d2-e9edac9c270c","block_type":"box","text":"funds that pay dividends that are exempt from regular U.S. federal income tax. Such funds in turn","page_number":167,"box":{"x":116,"y":831,"width":728,"height":12}},{"id":"2dae51f0-98f4-4b9f-912d-2116da902673","block_type":"box","text":"invest in municipal bonds and other assets that pay interest or make distributions that are exempt from","page_number":167,"box":{"x":117,"y":847,"width":765,"height":12}},{"id":"5802ae1e-6465-416a-b998-5d5a4575febf","block_type":"box","text":"regular U.S. federal income tax, such as revenue bonds issued by state or local agencies to fund the","page_number":167,"box":{"x":117,"y":862,"width":751,"height":12}},{"id":"8a83f36e-64b5-4ebe-bbc0-314b837d5c81","block_type":"box","text":"development of low-income, multi-family housing. Investment in such tax-exempt preferred shares","page_number":167,"box":{"x":116,"y":878,"width":733,"height":12}},{"id":"2408c6c7-13f6-455e-adfd-2b1b0cfb1a25","block_type":"box","text":"II-83","page_number":167,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"f6051b18-4dbe-463b-86ea-2eecf79c2fef","block_type":"box","text":"NM0926U-5926888-167/257","page_number":167,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"6659d0ac-e172-4c6c-aca3-da3c8415b111","block_type":"box","text":"involves many of the same issues as investing in other investment companies. These investments also","page_number":168,"box":{"x":117,"y":87,"width":768,"height":12}},{"id":"dcb64ea5-d64d-4d4c-8357-aa17adef269c","block_type":"box","text":"have additional risks, including illiquid investments risk, the absence of regulation governing","page_number":168,"box":{"x":117,"y":102,"width":685,"height":13}},{"id":"a0cbc2d1-b761-459c-9c8f-89fbd816e99a","block_type":"box","text":"investment practices, capital structure and leverage, affiliated transactions and other matters, and","page_number":168,"box":{"x":117,"y":118,"width":729,"height":12}},{"id":"0f51fa6b-907c-48cb-a04c-e9b49291a2b7","block_type":"box","text":"concentration of investments in particular issuers or industries. The Municipal Bond Funds will treat","page_number":168,"box":{"x":116,"y":134,"width":740,"height":11}},{"id":"345ba621-7c52-4b1a-88a6-12d70dc487f5","block_type":"box","text":"investments in tax-exempt preferred shares as investments in municipal bonds.","page_number":168,"box":{"x":117,"y":149,"width":593,"height":12}},{"id":"fd2cf29b-2e7c-415e-8555-c69238dc3ae6","block_type":"box","text":"Trust Preferred Securities.","page_number":168,"box":{"x":118,"y":180,"width":193,"height":10}},{"id":"8198831d-9d1f-40ec-8d5b-dc1f644371a1","block_type":"box","text":"Certain Funds may invest in trust preferred securities. Trust preferred","page_number":168,"box":{"x":312,"y":180,"width":525,"height":12}},{"id":"2500bb1d-425c-42e8-90bc-5cbb67cc0c11","block_type":"box","text":"securities are typically issued by corporations, generally in the form of interest bearing notes with","page_number":168,"box":{"x":116,"y":196,"width":724,"height":12}},{"id":"b88d00f2-9fcb-41d4-9597-3e3c76c4308e","block_type":"box","text":"preferred securities characteristics, or by an affiliated business trust of a corporation, generally in the","page_number":168,"box":{"x":117,"y":211,"width":751,"height":12}},{"id":"9907a095-dafb-4843-b82c-8fec0eb401f4","block_type":"box","text":"form of beneficial interests in subordinated debentures or similarly structured securities. The trust","page_number":168,"box":{"x":116,"y":227,"width":726,"height":12}},{"id":"4bd6e1b9-85c9-483b-a6c5-6f521d72770d","block_type":"box","text":"preferred securities market consists of both fixed and adjustable coupon rate securities that are either","page_number":168,"box":{"x":117,"y":242,"width":758,"height":12}},{"id":"e81f2929-db9f-459c-a0d2-3139bb7e86fa","block_type":"box","text":"perpetual in nature or have stated maturity dates.","page_number":168,"box":{"x":117,"y":258,"width":370,"height":12}},{"id":"360755c8-c0f1-4aab-9255-5708d30c5ce4","block_type":"box","text":"Trust preferred securities are typically junior and fully subordinated liabilities of an issuer and benefit","page_number":168,"box":{"x":116,"y":289,"width":748,"height":12}},{"id":"a6136c98-5701-4780-ba6f-e8353b324b4f","block_type":"box","text":"from a guarantee that is junior and fully subordinated to the other liabilities of the guarantor. In addition,","page_number":168,"box":{"x":116,"y":304,"width":771,"height":12}},{"id":"5964db48-c2b6-408d-88e5-7d9f4b1c2d09","block_type":"box","text":"trust preferred securities typically permit an issuer to defer the payment of income for five years or","page_number":168,"box":{"x":116,"y":320,"width":733,"height":12}},{"id":"e6b908ac-f54d-4be7-b524-8dbe1b3fdcb3","block_type":"box","text":"more without triggering an event of default. Because of their subordinated position in the capital","page_number":168,"box":{"x":117,"y":335,"width":713,"height":12}},{"id":"dd21290b-1863-4391-a785-29e3839b4411","block_type":"box","text":"structure of an issuer, the ability to defer payments for extended periods of time without default","page_number":168,"box":{"x":116,"y":351,"width":708,"height":12}},{"id":"732b02cd-1a2c-47ff-b371-2fdfbcc404d8","block_type":"box","text":"consequences to the issuer, and certain other features (such as restrictions on common dividend","page_number":168,"box":{"x":116,"y":366,"width":725,"height":12}},{"id":"02bc31e8-a25c-4125-9613-573d413321b6","block_type":"box","text":"payments by the issuer or ultimate guarantor when full cumulative payments on the trust preferred","page_number":168,"box":{"x":117,"y":382,"width":733,"height":12}},{"id":"7db6a691-4234-4251-a213-65eaa0fa9877","block_type":"box","text":"securities have not been made), these trust preferred securities are often treated as close substitutes","page_number":168,"box":{"x":116,"y":397,"width":756,"height":12}},{"id":"2a004802-ef58-4171-aca4-d3dd90933d05","block_type":"box","text":"for traditional preferred securities, both by issuers and investors.","page_number":168,"box":{"x":116,"y":413,"width":483,"height":12}},{"id":"4dede285-8748-4097-af15-fe9f76dc349b","block_type":"box","text":"Trust preferred securities include but are not limited to trust originated preferred securities (“TOPRS","page_number":168,"box":{"x":116,"y":444,"width":740,"height":12}},{"id":"8a9586eb-6e35-4313-9dfb-630fbd1a409b","block_type":"box","text":"®","page_number":168,"box":{"x":857,"y":443,"width":9,"height":7}},{"id":"a9b939d6-9aad-4abc-bd62-ff1715411289","block_type":"box","text":"”);","page_number":168,"box":{"x":867,"y":444,"width":20,"height":12}},{"id":"14525531-bc32-4873-9a46-ea2a68152362","block_type":"box","text":"monthly income preferred securities (“MIPS","page_number":168,"box":{"x":117,"y":459,"width":322,"height":12}},{"id":"65f58ade-a558-4f93-9de3-82e84beaf710","block_type":"box","text":"®","page_number":168,"box":{"x":439,"y":458,"width":10,"height":7}},{"id":"96bcacf9-e97f-4b5a-91a2-ba0878b37c75","block_type":"box","text":"”); quarterly income bond securities (“QUIBS","page_number":168,"box":{"x":449,"y":459,"width":330,"height":12}},{"id":"84dad3ab-ee14-4efc-901d-00f7cf59a443","block_type":"box","text":"®","page_number":168,"box":{"x":780,"y":458,"width":9,"height":7}},{"id":"cc1f3aef-4d20-45ba-851e-0ea9b53a04fd","block_type":"box","text":"” ); quarterly","page_number":168,"box":{"x":790,"y":459,"width":95,"height":12}},{"id":"a9a6cdbe-5da4-47b1-8bda-edea7f122150","block_type":"box","text":"income debt securities (“QUIDS","page_number":168,"box":{"x":117,"y":475,"width":234,"height":12}},{"id":"992c5389-5707-4e7b-9c94-1ce542204b52","block_type":"box","text":"®","page_number":168,"box":{"x":352,"y":474,"width":10,"height":7}},{"id":"f90c3509-bb10-4da8-bbdf-ca38bfb8e67a","block_type":"box","text":"”); quarterly income preferred securities (“QUIPS","page_number":168,"box":{"x":362,"y":475,"width":361,"height":12}},{"id":"273cc46e-dd14-4dc8-a130-417dc7141b25","block_type":"box","text":"SM","page_number":168,"box":{"x":724,"y":475,"width":16,"height":6}},{"id":"90b2e266-dbe5-4d01-a6eb-2cf0c8246442","block_type":"box","text":"”); corporate trust","page_number":168,"box":{"x":741,"y":475,"width":133,"height":12}},{"id":"168b8eb9-2c40-471f-aeb8-7346819de3c9","block_type":"box","text":"securities (“CORTS","page_number":168,"box":{"x":116,"y":490,"width":145,"height":12}},{"id":"bfb54410-0842-4778-aba3-c7d73c80111e","block_type":"box","text":"®","page_number":168,"box":{"x":262,"y":489,"width":9,"height":7}},{"id":"7767bd96-4599-4c27-bf7d-db274e6dc86a","block_type":"box","text":"”); public income notes (“PINES","page_number":168,"box":{"x":271,"y":490,"width":235,"height":12}},{"id":"1b0dc0a4-ca6c-4af4-bb9a-a05917488fc6","block_type":"box","text":"®","page_number":168,"box":{"x":507,"y":489,"width":9,"height":7}},{"id":"251edec2-bc9d-40a2-8a94-d27bb34da248","block_type":"box","text":"”); and other trust preferred securities.","page_number":168,"box":{"x":517,"y":490,"width":287,"height":12}},{"id":"f3dd73b0-093c-4c0c-ba30-005c2bd1ba09","block_type":"box","text":"Trust preferred securities are typically issued with a final maturity date, although some are perpetual in","page_number":168,"box":{"x":116,"y":521,"width":766,"height":12}},{"id":"434b88f2-c656-48d4-bb14-dd2e34773830","block_type":"box","text":"nature. In certain instances, a final maturity date may be extended and/or the final payment of principal","page_number":168,"box":{"x":117,"y":537,"width":767,"height":12}},{"id":"dd948b9c-2756-4e86-92b9-a74cd831bcf0","block_type":"box","text":"may be deferred at the issuer’s option for a specified time without default. No redemption can typically","page_number":168,"box":{"x":117,"y":552,"width":760,"height":12}},{"id":"f5515d1a-cfb9-4e0b-9bbc-f191b35a5884","block_type":"box","text":"take place unless all cumulative payment obligations have been met, although issuers may be able to","page_number":168,"box":{"x":116,"y":568,"width":758,"height":12}},{"id":"0afb7e6c-7485-43da-b483-6150c498f892","block_type":"box","text":"engage in open-market repurchases without regard to whether all payments have been paid.","page_number":168,"box":{"x":116,"y":583,"width":693,"height":12}},{"id":"65fbb503-aafe-44c9-a5fe-96143016f893","block_type":"box","text":"Many trust preferred securities are issued by trusts or other special purpose entities established by","page_number":168,"box":{"x":117,"y":614,"width":737,"height":12}},{"id":"f81a7de5-1721-42f8-85ba-61ee4a2d4fb0","block_type":"box","text":"operating companies and are not a direct obligation of an operating company. At the time the trust or","page_number":168,"box":{"x":116,"y":630,"width":752,"height":12}},{"id":"f756483f-a1e9-4223-a1c2-2228931ea76b","block_type":"box","text":"special purpose entity sells such preferred securities to investors, it purchases debt of the operating","page_number":168,"box":{"x":116,"y":645,"width":745,"height":12}},{"id":"e0feae87-33da-4e06-a4ec-997c85d2e047","block_type":"box","text":"company (with terms comparable to those of the trust or special purpose entity securities), which","page_number":168,"box":{"x":116,"y":661,"width":717,"height":12}},{"id":"ab64da50-cd7b-4d2a-a176-ee2e498bbe5f","block_type":"box","text":"enables the operating company to deduct for tax purposes the interest paid on the debt held by the","page_number":168,"box":{"x":116,"y":676,"width":734,"height":12}},{"id":"acb36b87-7076-457d-bc74-1b1a94f7959b","block_type":"box","text":"trust or special purpose entity. The trust or special purpose entity is generally required to be treated as","page_number":168,"box":{"x":116,"y":692,"width":760,"height":12}},{"id":"2375cb95-0f44-4b24-b74f-dc670f143c6d","block_type":"box","text":"transparent for U.S. federal income tax purposes such that the holders of the trust preferred securities","page_number":168,"box":{"x":116,"y":707,"width":757,"height":12}},{"id":"aabf691b-3ca9-4f1f-9f42-fec36f4ad21d","block_type":"box","text":"are treated as owning beneficial interests in the underlying debt of the operating company. Accordingly,","page_number":168,"box":{"x":116,"y":723,"width":765,"height":12}},{"id":"b694a567-bf0e-406b-b44f-f933101c849e","block_type":"box","text":"payments on the trust preferred securities are treated as interest rather than dividends for U.S. federal","page_number":168,"box":{"x":117,"y":738,"width":757,"height":12}},{"id":"7e426c29-c5f4-48aa-a96b-300705c600e8","block_type":"box","text":"income tax purposes. The trust or special purpose entity in turn would be a holder of the operating","page_number":168,"box":{"x":117,"y":754,"width":727,"height":12}},{"id":"72ad34b7-c72b-4001-9d82-8f2ca6a547b4","block_type":"box","text":"company’s debt and would have priority with respect to the operating company’s earnings and profits","page_number":168,"box":{"x":116,"y":769,"width":748,"height":12}},{"id":"946aa9c6-23fe-4d12-8b1f-2424a316429e","block_type":"box","text":"over the operating company’s common shareholders, but would typically be subordinated to other","page_number":168,"box":{"x":116,"y":785,"width":725,"height":12}},{"id":"ab079f1d-13b6-4fe0-9102-839e09aa54a4","block_type":"box","text":"classes of the operating company’s debt. Typically a preferred share has a rating that is slightly below","page_number":168,"box":{"x":116,"y":800,"width":756,"height":12}},{"id":"67b2a7cc-7553-47c4-b266-4a079c6559a9","block_type":"box","text":"that of its corresponding operating company’s senior debt securities.","page_number":168,"box":{"x":116,"y":816,"width":506,"height":12}},{"id":"56a52d4d-9626-4ce8-812c-c78f3c960299","block_type":"box","text":"Real Estate Investment Trusts (“REITs”).","page_number":168,"box":{"x":116,"y":847,"width":324,"height":12}},{"id":"6a15f7cf-2e9a-4468-bf65-97621c52ca3d","block_type":"box","text":"In pursuing its investment strategy, a Fund may invest in","page_number":168,"box":{"x":441,"y":847,"width":430,"height":12}},{"id":"8525ee2c-9d4c-4915-865e-122a982e00af","block_type":"box","text":"shares of REITs. REITs possess certain risks which differ from an investment in common stocks.","page_number":168,"box":{"x":116,"y":862,"width":724,"height":12}},{"id":"5b36f121-0dc0-4ff8-a29d-5136519074b8","block_type":"box","text":"REITs are financial vehicles that pool investor’s capital to purchase or finance real estate. REITs may","page_number":168,"box":{"x":117,"y":878,"width":756,"height":12}},{"id":"e56975b5-aa61-4050-b81b-1e9f0ae1977c","block_type":"box","text":"II-84","page_number":168,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"f5876ad3-5d57-4124-b0f8-a8b2d728ea69","block_type":"box","text":"NM0926U-5926888-168/257","page_number":168,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"46422242-3aad-4973-9ad8-0bc5b30cda46","block_type":"box","text":"concentrate their investments in specific geographic areas or in specific property types,","page_number":169,"box":{"x":116,"y":87,"width":652,"height":12}},{"id":"c4e6d7f4-c7dc-4166-8ba9-1e4cd4a6a530","block_type":"box","text":"i.e.","page_number":169,"box":{"x":768,"y":87,"width":21,"height":10}},{"id":"d08ad670-98e0-4587-9624-9215adab2074","block_type":"box","text":", hotels,","page_number":169,"box":{"x":792,"y":87,"width":62,"height":11}},{"id":"61ff2252-85c5-4613-8049-569254d3a4d5","block_type":"box","text":"shopping malls, residential complexes and office buildings.","page_number":169,"box":{"x":116,"y":102,"width":441,"height":13}},{"id":"179b76e1-4456-46e4-970f-18faaad49c0a","block_type":"box","text":"REITs are subject to management fees and other expenses, and so a Fund that invests in REITs will","page_number":169,"box":{"x":117,"y":134,"width":752,"height":12}},{"id":"106e6096-7367-489b-b747-4b1cf97f0e08","block_type":"box","text":"bear its proportionate share of the costs of the REITs’ operations. There are three general categories","page_number":169,"box":{"x":117,"y":149,"width":754,"height":12}},{"id":"ab394a51-43ce-4e22-8053-bfc45ef71843","block_type":"box","text":"of REITs: Equity REITs, Mortgage REITs and Hybrid REITs. Equity REITs invest primarily in direct fee","page_number":169,"box":{"x":116,"y":165,"width":763,"height":12}},{"id":"fd1b619a-bfc7-4881-8237-7b3dde500a52","block_type":"box","text":"ownership or leasehold ownership of real property, which derive most of their income from rents.","page_number":169,"box":{"x":116,"y":180,"width":721,"height":12}},{"id":"bb254790-10b5-429b-9ea0-154b00331b4b","block_type":"box","text":"Mortgage REITs invest mostly in mortgages on real estate, which may secure construction,","page_number":169,"box":{"x":117,"y":196,"width":681,"height":12}},{"id":"bd379b0b-0291-4af3-be0f-731fa6b38b74","block_type":"box","text":"development or long-term loans; the main source of their income is mortgage interest payments.","page_number":169,"box":{"x":116,"y":211,"width":720,"height":12}},{"id":"e22a5120-3c0c-4e23-87b6-3af45d045680","block_type":"box","text":"Hybrid REITs hold both ownership and mortgage interests in real estate.","page_number":169,"box":{"x":117,"y":227,"width":541,"height":12}},{"id":"300ad8fd-20d6-43a4-95bd-b9c78fa81977","block_type":"box","text":"Investing in REITs involves certain unique risks in addition to those risks associated with investing in","page_number":169,"box":{"x":117,"y":258,"width":749,"height":12}},{"id":"93e58459-148e-492a-bdcf-e0761d26fc15","block_type":"box","text":"the real estate industry in general. The market value of REIT shares and the ability of the REITs to","page_number":169,"box":{"x":116,"y":273,"width":735,"height":12}},{"id":"b8cf1cf9-d67c-4203-afd4-39a1c9355a26","block_type":"box","text":"distribute income may be adversely affected by several factors, including rising interest rates, changes","page_number":169,"box":{"x":116,"y":289,"width":765,"height":12}},{"id":"5a833a6d-26e8-4b9a-b5c7-c22375561ad1","block_type":"box","text":"in the national, state and local economic climate and real estate conditions, occupancy and rental","page_number":169,"box":{"x":117,"y":304,"width":727,"height":12}},{"id":"884d377d-886a-4049-a8e7-58c3b99e3e78","block_type":"box","text":"rates, perceptions of prospective tenants of the safety, convenience and attractiveness of the","page_number":169,"box":{"x":117,"y":320,"width":695,"height":12}},{"id":"06efd3ed-6ad1-4a9c-b42a-1cad77bfbf06","block_type":"box","text":"properties, the ability of the owners to provide adequate management, maintenance and insurance, the","page_number":169,"box":{"x":117,"y":335,"width":770,"height":12}},{"id":"cf3d8f0b-8bdb-4a31-984d-522cbf0c60b7","block_type":"box","text":"cost of complying with the Americans with Disabilities Act, increased competition from new properties,","page_number":169,"box":{"x":116,"y":351,"width":761,"height":12}},{"id":"e702969e-a37f-44e9-bdb1-376721d47b21","block_type":"box","text":"the impact of present or future environmental legislation and compliance with environmental laws,","page_number":169,"box":{"x":116,"y":366,"width":729,"height":12}},{"id":"39718b27-22fc-43b9-8cf5-b04b18692b2e","block_type":"box","text":"failing to maintain their exemptions from registration under the Investment Company Act, changes in","page_number":169,"box":{"x":116,"y":382,"width":749,"height":12}},{"id":"beb9a358-24c3-4974-bde5-b7bdd73c9a84","block_type":"box","text":"real estate taxes and other operating expenses, adverse changes in governmental rules and fiscal","page_number":169,"box":{"x":117,"y":397,"width":733,"height":12}},{"id":"1507b6dd-feb7-46ab-ae3f-5a6cb8089310","block_type":"box","text":"policies, adverse changes in zoning laws and other factors beyond the control of the issuers of the","page_number":169,"box":{"x":117,"y":413,"width":733,"height":12}},{"id":"fc0d91a4-1718-407a-a11e-4d2850cdd584","block_type":"box","text":"REITs. To the extent that assets underlying a REIT are concentrated geographically, by property type,","page_number":169,"box":{"x":117,"y":428,"width":762,"height":12}},{"id":"1df391bf-5819-4907-a134-6aaaa083f94c","block_type":"box","text":"or in certain other respects, these risks may be heightened.","page_number":169,"box":{"x":116,"y":444,"width":446,"height":12}},{"id":"18bd440d-2e56-4977-bf05-bca2ce7f7489","block_type":"box","text":"In addition, distributions received by a Fund from REITs may consist of dividends, capital gains and/or","page_number":169,"box":{"x":117,"y":475,"width":761,"height":12}},{"id":"de2b2322-046f-48f8-828f-6c8c30a7c6e3","block_type":"box","text":"return of capital. As REITs generally pay a higher rate of dividends (on a pre-tax basis) than operating","page_number":169,"box":{"x":117,"y":490,"width":760,"height":12}},{"id":"b7e4037b-0b15-491f-b1e7-c51c16167c17","block_type":"box","text":"companies, to the extent application of the Fund’s investment strategy results in the Fund investing in","page_number":169,"box":{"x":116,"y":506,"width":758,"height":12}},{"id":"856c397f-a529-414d-b325-9ca22bff2651","block_type":"box","text":"REIT shares, the percentage of the Fund’s dividend income received from REIT shares will likely","page_number":169,"box":{"x":117,"y":521,"width":722,"height":12}},{"id":"53943d96-5f60-452f-a495-1f07639d0b47","block_type":"box","text":"exceed the percentage of the Fund’s portfolio which is comprised of REIT shares. Ordinary REIT","page_number":169,"box":{"x":116,"y":537,"width":723,"height":12}},{"id":"af5d7592-3ee6-42ef-91ea-9f9a372cefed","block_type":"box","text":"dividends received by the Fund and distributed to the Fund’s shareholders will generally be taxable as","page_number":169,"box":{"x":116,"y":552,"width":762,"height":12}},{"id":"34299fed-53c9-4d89-9776-bb1457b98ac1","block_type":"box","text":"ordinary income and will not constitute “qualified dividend income.” However, a non-corporate taxpayer","page_number":169,"box":{"x":116,"y":568,"width":768,"height":12}},{"id":"2f410b9d-ecb5-4a51-8755-6dd0064722e7","block_type":"box","text":"who is a direct REIT shareholder may claim a 20% “qualified business income” deduction for ordinary","page_number":169,"box":{"x":116,"y":583,"width":757,"height":12}},{"id":"bea1fefa-3be3-4740-9b46-6cc5d20769f6","block_type":"box","text":"REIT dividends, and a regulated investment company may report dividends as eligible for this","page_number":169,"box":{"x":117,"y":599,"width":698,"height":12}},{"id":"7d98ec88-659e-4378-96ae-51b666a81e4e","block_type":"box","text":"deduction to the extent the regulated investment company’s income is derived from ordinary REIT","page_number":169,"box":{"x":116,"y":614,"width":731,"height":12}},{"id":"ae82a56f-7254-4b5f-869f-6970fe02acd0","block_type":"box","text":"dividends (reduced by allocable regulated investment company expenses). A shareholder may treat","page_number":169,"box":{"x":116,"y":630,"width":745,"height":12}},{"id":"b9e4ca85-3d47-4e83-be3d-d366798b8549","block_type":"box","text":"the dividends as such provided the regulated investment company and the shareholder satisfy","page_number":169,"box":{"x":116,"y":645,"width":704,"height":12}},{"id":"4110c98e-8f01-4134-84a8-ecf15e35cecc","block_type":"box","text":"applicable holding period requirements.","page_number":169,"box":{"x":116,"y":661,"width":292,"height":12}},{"id":"f7a9ee98-e58c-4622-bb80-478df0db6d2d","block_type":"box","text":"REITs (especially mortgage REITs) are also subject to interest rate risk. Rising interest rates may","page_number":169,"box":{"x":117,"y":692,"width":723,"height":12}},{"id":"537f4667-59fa-4b4c-b3be-dd4a802a85b5","block_type":"box","text":"cause REIT investors to demand a higher annual yield, which may, in turn, cause a decline in the","page_number":169,"box":{"x":116,"y":707,"width":720,"height":12}},{"id":"686a27e1-f9f2-4f41-b8f3-3c111be8d573","block_type":"box","text":"market price of the equity securities issued by a REIT. Rising interest rates also generally increase the","page_number":169,"box":{"x":117,"y":723,"width":759,"height":12}},{"id":"11fd4191-02a5-4e29-a607-5470c81a0ceb","block_type":"box","text":"costs of obtaining financing, which could cause the value of a Fund’s REIT investments to decline.","page_number":169,"box":{"x":116,"y":738,"width":728,"height":12}},{"id":"f41e4494-d400-47e4-a869-e196a9efafe6","block_type":"box","text":"During periods when interest rates are declining, mortgages are often refinanced. Refinancing may","page_number":169,"box":{"x":117,"y":754,"width":733,"height":12}},{"id":"dcaca8ca-7fb9-4b15-ab37-e4da9caaaa1b","block_type":"box","text":"reduce the yield on investments in mortgage REITs. In addition, since REITs depend on payment","page_number":169,"box":{"x":117,"y":769,"width":721,"height":12}},{"id":"9fd10236-4824-4649-8cae-2584002d7bbd","block_type":"box","text":"under their mortgage loans and leases to generate cash to make distributions to their shareholders,","page_number":169,"box":{"x":117,"y":785,"width":737,"height":12}},{"id":"e8671079-6769-4e2a-959d-d74587061c55","block_type":"box","text":"investments in REITs may be adversely affected by defaults on such mortgage loans or leases.","page_number":169,"box":{"x":117,"y":800,"width":706,"height":12}},{"id":"0b6e6ab8-22e1-4a12-b197-06d88370670c","block_type":"box","text":"Investing in certain REITs, which often have small market capitalizations, may also involve the same","page_number":169,"box":{"x":117,"y":831,"width":741,"height":12}},{"id":"0bb99ea1-56c3-49b9-bce5-c1b87e398f69","block_type":"box","text":"risks as investing in other small capitalization companies. REITs may have limited financial resources","page_number":169,"box":{"x":117,"y":847,"width":749,"height":12}},{"id":"2662ca97-15bc-4a1c-b727-ed1b45120e07","block_type":"box","text":"and their securities may trade less frequently and in limited volume and may be subject to more abrupt","page_number":169,"box":{"x":116,"y":862,"width":758,"height":12}},{"id":"c07ab2dd-0d06-415a-a1f8-57a943afa534","block_type":"box","text":"or erratic price movements than larger company securities. Historically, small capitalization stocks, such","page_number":169,"box":{"x":116,"y":878,"width":768,"height":12}},{"id":"cba2a62c-9b4c-4d69-9bcc-6b4f9edba77d","block_type":"box","text":"II-85","page_number":169,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"3f08477e-1b23-4722-88fd-446942cd6bd9","block_type":"box","text":"NM0926U-5926888-169/257","page_number":169,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"a480335b-c480-45b9-97b1-b952a99b45a6","block_type":"box","text":"as REITs, have been more volatile in price than the larger capitalization stocks such as those included","page_number":170,"box":{"x":116,"y":87,"width":756,"height":12}},{"id":"ffbdfcf2-1102-4752-9b37-dd678f7ed2f6","block_type":"box","text":"in the S&P 500 Index. The management of a REIT may be subject to conflicts of interest with respect to","page_number":170,"box":{"x":117,"y":102,"width":764,"height":13}},{"id":"4c8cf210-197c-4218-ae1b-fb28ffa7de95","block_type":"box","text":"the operation of the business of the REIT and may be involved in real estate activities competitive with","page_number":170,"box":{"x":116,"y":118,"width":756,"height":12}},{"id":"059b5c1e-f4b8-45b3-bd26-8c455dbc21a0","block_type":"box","text":"the REIT. REITs may own properties through joint ventures or in other circumstances in which the REIT","page_number":170,"box":{"x":116,"y":134,"width":766,"height":12}},{"id":"380ebfab-f5e4-4316-8034-9892d1b5f238","block_type":"box","text":"may not have control over its investments. REITs may incur significant amounts of leverage.","page_number":170,"box":{"x":117,"y":149,"width":681,"height":12}},{"id":"d0014bfa-719f-49b2-b70c-b32627377fca","block_type":"box","text":"Market Risks/Recent Market Events.","page_number":170,"box":{"x":116,"y":180,"width":293,"height":10}},{"id":"0b11c583-932f-4a04-b177-445fbbab5bec","block_type":"box","text":"Securities may decline in value due to factors affecting","page_number":170,"box":{"x":409,"y":180,"width":410,"height":12}},{"id":"391f0249-1bce-4005-bc0e-ef3f2286eaab","block_type":"box","text":"securities markets generally or particular industries represented in the markets. The value of a security","page_number":170,"box":{"x":116,"y":196,"width":767,"height":12}},{"id":"0430fa56-9635-48e3-9a48-edc6734e488c","block_type":"box","text":"may decline due to general market conditions, economic trends or events that are not specifically","page_number":170,"box":{"x":117,"y":211,"width":725,"height":12}},{"id":"49cc22ff-5281-4aa0-a823-418a50383c0d","block_type":"box","text":"related to a company or to factors that affect a particular industry or industries, or factors that affect a","page_number":170,"box":{"x":117,"y":227,"width":754,"height":12}},{"id":"e89e75e0-120a-4d3b-98b0-e4f546c33b50","block_type":"box","text":"particular issuer or issuers, exchange, country, group of countries, region, market, industry, group of","page_number":170,"box":{"x":117,"y":242,"width":748,"height":12}},{"id":"1fe12a11-06d5-43ac-b484-535a3b844832","block_type":"box","text":"industries, sector or asset class. The success of a Fund’s activities could be affected by interest rates,","page_number":170,"box":{"x":117,"y":258,"width":761,"height":12}},{"id":"b2cb4928-d3bd-47ec-a51f-ddffb2174908","block_type":"box","text":"availability of credit, inflation rates, economic uncertainty, changes in laws, trade barriers, economic","page_number":170,"box":{"x":116,"y":273,"width":744,"height":12}},{"id":"ec0c883d-82ed-46ae-aae4-28b8361008f3","block_type":"box","text":"sanctions, currency exchange controls, and local, regional or global events such as war, acts of","page_number":170,"box":{"x":116,"y":289,"width":714,"height":12}},{"id":"e038fdbd-b69a-4bfe-b3f3-88d797c266ce","block_type":"box","text":"terrorism, natural and environmental disasters, the spread of infectious illness or other public health","page_number":170,"box":{"x":116,"y":304,"width":744,"height":12}},{"id":"95e03302-31ab-45e8-a4b3-a80611e91100","block_type":"box","text":"issues, recessions, or other events could have a significant impact on a Fund and its investments.","page_number":170,"box":{"x":117,"y":320,"width":730,"height":12}},{"id":"004a5f9c-b9d7-434e-abb7-e12a95c4ad75","block_type":"box","text":"During a general economic downturn in the securities markets, multiple asset classes may be","page_number":170,"box":{"x":117,"y":335,"width":698,"height":12}},{"id":"4097846d-b499-4679-87dd-6a59528e45bc","block_type":"box","text":"negatively affected. These factors may affect the level and volatility of securities prices and the liquidity","page_number":170,"box":{"x":117,"y":351,"width":768,"height":12}},{"id":"bfdafa1b-5a7f-4bf4-b8bf-a3b6a67d0151","block_type":"box","text":"of a Fund’s investments, which could impair the Fund’s profitability or result in losses. A Fund may","page_number":170,"box":{"x":116,"y":366,"width":734,"height":12}},{"id":"48f8754e-750a-4c60-8483-266e39915507","block_type":"box","text":"maintain substantial trading positions that can be adversely affected by the level of volatility in the","page_number":170,"box":{"x":117,"y":382,"width":728,"height":12}},{"id":"986051be-45d1-46d3-938f-4a035647b164","block_type":"box","text":"financial markets; the larger the positions, the greater the potential for loss. Unpredictable or unstable","page_number":170,"box":{"x":116,"y":397,"width":758,"height":12}},{"id":"7cbe5e9a-2fde-49f3-a6a2-7eafebd02e00","block_type":"box","text":"market conditions may result in reduced opportunities to find suitable investments to deploy capital or","page_number":170,"box":{"x":117,"y":413,"width":756,"height":12}},{"id":"3cd77e70-be5c-4a53-aaff-6bfe3afa38d0","block_type":"box","text":"make it more difficult to exit and realize value","page_number":170,"box":{"x":117,"y":428,"width":339,"height":10}},{"id":"4a1572eb-9d31-4528-bc55-593c8714d38c","block_type":"box","text":"from a Fund’s existing investments. It is important to","page_number":170,"box":{"x":456,"y":428,"width":394,"height":12}},{"id":"e466dd77-b209-4a87-9b0e-56d0271df1e7","block_type":"box","text":"understand that a Fund can incur material losses even if it reacts quickly to difficult market conditions","page_number":170,"box":{"x":117,"y":444,"width":754,"height":12}},{"id":"b593eb2e-2a0e-4e7e-8cbd-d14f43597aff","block_type":"box","text":"and there can be no assurance that a Fund will not suffer material adverse effects from broad and","page_number":170,"box":{"x":116,"y":459,"width":732,"height":10}},{"id":"96495cbd-7a89-4d82-9cad-3b706773c4d9","block_type":"box","text":"rapid changes in market conditions.","page_number":170,"box":{"x":117,"y":475,"width":268,"height":12}},{"id":"2259e2a6-a8d9-46ce-98ac-20b5bb31d0af","block_type":"box","text":"Periods of unusually high volatility in the financial","page_number":170,"box":{"x":117,"y":506,"width":359,"height":12}},{"id":"8e70b8ad-b35f-443f-9dfe-1fffcc1e7065","block_type":"box","text":"markets and restrictive credit conditions, sometimes","page_number":170,"box":{"x":477,"y":506,"width":381,"height":11}},{"id":"29e3c4b4-f0b4-4459-8b23-bcad26563163","block_type":"box","text":"limited to a particular sector or a geography, can o","page_number":170,"box":{"x":117,"y":521,"width":364,"height":12}},{"id":"2f8ac39e-5629-49f5-9981-b2f589f2405e","block_type":"box","text":"ccur. Some countries, including the United States,","page_number":170,"box":{"x":482,"y":521,"width":368,"height":12}},{"id":"9288a1f2-19a5-4a1d-949c-8f70fb264809","block_type":"box","text":"have adopted and/or are considering the adoption of more","page_number":170,"box":{"x":117,"y":537,"width":422,"height":12}},{"id":"6e7a698b-4e81-4cc5-b05e-efd306635b2f","block_type":"box","text":"protectionist trade policies, a move away from","page_number":170,"box":{"x":539,"y":537,"width":344,"height":12}},{"id":"2b9a89a0-03cc-4d4d-ae50-27b998cd2aa3","block_type":"box","text":"the tighter financial industry regulations that follow","page_number":170,"box":{"x":116,"y":552,"width":363,"height":12}},{"id":"254931f8-819c-4fb0-b8ec-f5fdce6640f1","block_type":"box","text":"ed the financial crisis of","page_number":170,"box":{"x":480,"y":552,"width":174,"height":10}},{"id":"e063995d-1f7a-4f24-b40e-243a8747e4df","block_type":"box","text":"2008, and/or substantially","page_number":170,"box":{"x":654,"y":552,"width":192,"height":12}},{"id":"6bd936da-eead-444b-b634-8c2f99305f5d","block_type":"box","text":"reducing corporate taxes. The exact shape of these","page_number":170,"box":{"x":117,"y":568,"width":379,"height":12}},{"id":"05eb7e95-97df-4463-9c3b-9cc751c9cece","block_type":"box","text":"policies is still being considered, but the equity and","page_number":170,"box":{"x":497,"y":568,"width":372,"height":12}},{"id":"4f830103-472c-4df4-9994-854107d7467f","block_type":"box","text":"debt markets may react strongly to expectations of c","page_number":170,"box":{"x":116,"y":583,"width":381,"height":12}},{"id":"172b9832-1e62-4f36-aa30-6ed8bc00fc5e","block_type":"box","text":"hange, which could increase volatility, especially if","page_number":170,"box":{"x":498,"y":583,"width":367,"height":12}},{"id":"cf1933a9-54db-477a-9aba-adc1d5095219","block_type":"box","text":"the market’s expectations are not borne out. A rise in","page_number":170,"box":{"x":116,"y":599,"width":384,"height":12}},{"id":"531b1661-545d-4b71-9481-6c7aa1348151","block_type":"box","text":"protectionist trade policies, and the possibility of","page_number":170,"box":{"x":501,"y":599,"width":357,"height":12}},{"id":"df6cf835-92eb-41e0-9c9e-cbf43c092ef9","block_type":"box","text":"changes to some international trade agreements, coul","page_number":170,"box":{"x":116,"y":614,"width":392,"height":12}},{"id":"42f38c3e-e038-44e8-b5c2-757e46c8b9d8","block_type":"box","text":"d affect the economies of many nations in ways","page_number":170,"box":{"x":509,"y":614,"width":350,"height":12}},{"id":"87e6a6a7-d900-4e3f-a950-2ecffad80dfe","block_type":"box","text":"that cannot necessarily be foreseen at the present","page_number":170,"box":{"x":116,"y":630,"width":370,"height":12}},{"id":"68fc961d-f7cb-4913-b0f4-36c2bce508c6","block_type":"box","text":"time. In addition, geopolitical and other risks, including","page_number":170,"box":{"x":486,"y":630,"width":398,"height":12}},{"id":"d9a11665-0317-4eeb-8b6f-3e1d473eb07b","block_type":"box","text":"environmental and public health, may add to instability in world economies and markets generally.","page_number":170,"box":{"x":116,"y":645,"width":716,"height":12}},{"id":"d5878d06-258a-4faa-b008-c982b95400b4","block_type":"box","text":"Economies and financial markets throughout the world","page_number":170,"box":{"x":117,"y":661,"width":394,"height":12}},{"id":"5732cdb6-653c-45fd-868d-4810265fc712","block_type":"box","text":"are increasingly interconnected. As a result,","page_number":170,"box":{"x":517,"y":661,"width":317,"height":12}},{"id":"20df857b-5463-4e25-8db1-c9b5b04cdbf3","block_type":"box","text":"whether or not a Fund invests in securities of issuers","page_number":170,"box":{"x":116,"y":676,"width":382,"height":10}},{"id":"8d403e72-3b9b-40e0-afce-f26de033990a","block_type":"box","text":"located in or with significant exposure to countries","page_number":170,"box":{"x":504,"y":676,"width":361,"height":12}},{"id":"ee59f53a-17b3-4681-9505-78b1503de00f","block_type":"box","text":"experiencing economic, political and/or financial di","page_number":170,"box":{"x":116,"y":692,"width":364,"height":12}},{"id":"ed239ff0-ae76-40c7-8f05-d7918570cb9b","block_type":"box","text":"fficulties, the value and liquidity of the Fund’s","page_number":170,"box":{"x":481,"y":692,"width":325,"height":12}},{"id":"61d485fe-d498-4c87-b47a-2ee8faa515e9","block_type":"box","text":"investments may be negatively affected by such events.","page_number":170,"box":{"x":117,"y":707,"width":405,"height":12}},{"id":"ed8b34e8-256f-48d9-b2bd-524db2b5d3bd","block_type":"box","text":"Governments and regulators may take actions that affect the regulation of the Fund or the instruments","page_number":170,"box":{"x":117,"y":738,"width":749,"height":12}},{"id":"dade93ec-a6f1-48b1-adae-4cf8b4f6110e","block_type":"box","text":"in which the Fund invests, or the issuers of such instruments, in ways that are unforeseeable. Future","page_number":170,"box":{"x":117,"y":754,"width":737,"height":12}},{"id":"de20e1fe-598c-4875-8e68-54c83ec50394","block_type":"box","text":"legislation or regulation or other governmental actions could limit or preclude the Fund’s abilities to","page_number":170,"box":{"x":117,"y":769,"width":722,"height":12}},{"id":"63d52d35-7d99-4442-bad9-838d2b04e366","block_type":"box","text":"achieve its investment objectives or otherwise adversely impact an investment in the Fund. Recent","page_number":170,"box":{"x":116,"y":785,"width":725,"height":12}},{"id":"259a9171-ec8b-43f6-84e1-d35ba536c040","block_type":"box","text":"policy initiatives undertaken by the U.S. government have the potential to impact international relations,","page_number":170,"box":{"x":117,"y":800,"width":756,"height":12}},{"id":"da6b2ff8-14ff-472d-a1c7-11115cd3dfe7","block_type":"box","text":"trade agreements and the overall regulatory environment in ways that could create uncertainty and","page_number":170,"box":{"x":116,"y":816,"width":724,"height":12}},{"id":"0c43b4f7-a9ec-487c-8e8a-ddc74875c51a","block_type":"box","text":"instability in domestic and global markets, and could adversely affect the investment performance of the","page_number":170,"box":{"x":117,"y":831,"width":766,"height":12}},{"id":"901c455d-b639-4a5e-be18-bff810b3deca","block_type":"box","text":"Fund. In particular, actions taken by the U.S. government in respect of international trade relations could","page_number":170,"box":{"x":117,"y":847,"width":770,"height":12}},{"id":"f3eb1430-4f35-4b61-85b8-3885c5a1eab4","block_type":"box","text":"lead to trade wars, increased costs for imported goods, disruptions in supply chains, reduced foreign","page_number":170,"box":{"x":117,"y":862,"width":742,"height":12}},{"id":"d9fa054e-90af-4a83-9e3d-41f6c70ceb2b","block_type":"box","text":"investment, and instability in regions where the Fund invests. Political and diplomatic events within the","page_number":170,"box":{"x":117,"y":878,"width":755,"height":12}},{"id":"e9fd1d0d-ad08-407e-b695-60e4d99531a9","block_type":"box","text":"II-86","page_number":170,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"37851d89-a094-4419-9255-8ae950fd45db","block_type":"box","text":"NM0926U-5926888-170/257","page_number":170,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"4b1bf104-fc3b-4a0b-a4b6-b2584fd65534","block_type":"box","text":"United States, including a contentious domestic political environment, changes in political party control","page_number":171,"box":{"x":117,"y":87,"width":756,"height":12}},{"id":"9c553741-ceaa-4d9f-8c8f-f926620b3155","block_type":"box","text":"of one or more branches of the U.S. Government, the U.S. Government’s inability at times to agree on a","page_number":171,"box":{"x":116,"y":102,"width":769,"height":13}},{"id":"06ae5420-8a21-4f30-bd42-f9b1b9a342ff","block_type":"box","text":"long-term budget and deficit reduction plan, the threat of a U.S. Government shutdown, and","page_number":171,"box":{"x":117,"y":118,"width":677,"height":12}},{"id":"8d05f673-eaba-4f2f-b6f2-50f38dc44a2a","block_type":"box","text":"disagreements over, or threats not to increase, the U.S. Government’s borrowing limit (or “debt ceiling”),","page_number":171,"box":{"x":116,"y":134,"width":769,"height":12}},{"id":"1eb80ad6-2d85-4787-b37d-c1813ee98c39","block_type":"box","text":"as well as political and diplomatic events abroad, may affect investor and consumer confidence and","page_number":171,"box":{"x":116,"y":149,"width":737,"height":12}},{"id":"d20b538d-9ab2-47e1-8f46-904e0a1c72ce","block_type":"box","text":"may adversely impact financial markets and the broader economy, perhaps suddenly and to a","page_number":171,"box":{"x":117,"y":165,"width":694,"height":12}},{"id":"761e1968-4916-4df7-a5a8-4c7adaae97f2","block_type":"box","text":"significant degree. A downgrade of the ratings of U.S. Government debt obligations, or concerns about","page_number":171,"box":{"x":116,"y":180,"width":759,"height":12}},{"id":"98a3bdd2-f894-4c31-8e45-470ecd888186","block_type":"box","text":"the U.S. Government’s credit quality in general, could have a substantial negative effect on the U.S. and","page_number":171,"box":{"x":116,"y":196,"width":770,"height":12}},{"id":"69304c15-2e3b-45ae-90c0-2336999b61ab","block_type":"box","text":"global economies. For example, concerns about the U.S. Government’s credit quality may cause","page_number":171,"box":{"x":116,"y":211,"width":715,"height":12}},{"id":"4614bfe4-b200-46e8-9f3f-2622fe01a501","block_type":"box","text":"increased volatility in the stock and bond markets, higher interest rates, reduced prices and liquidity of","page_number":171,"box":{"x":117,"y":227,"width":752,"height":12}},{"id":"64bc89b4-a7f3-416f-a0e4-f11b4db4c226","block_type":"box","text":"U.S. Treasury securities, and/or increased costs of various kinds of debt. Moreover, although the U.S.","page_number":171,"box":{"x":117,"y":242,"width":751,"height":12}},{"id":"83a661ab-95b9-41ed-9f50-11a4feaabc38","block_type":"box","text":"Government has honored its credit obligations, there remains a possibility that the United States could","page_number":171,"box":{"x":117,"y":258,"width":754,"height":12}},{"id":"775cb928-a977-4036-b1a1-4c1a0f01c254","block_type":"box","text":"default on its obligations. The consequences of such an unprecedented event are impossible to predict,","page_number":171,"box":{"x":116,"y":273,"width":765,"height":12}},{"id":"12354013-7a27-4e29-93a2-13898f2d23c9","block_type":"box","text":"but it is likely that a default by the United States would be highly disruptive to the U.S. and global","page_number":171,"box":{"x":117,"y":289,"width":714,"height":12}},{"id":"75f349b6-5383-4f94-ba92-a213c1b4221b","block_type":"box","text":"securities markets and could significantly impair the value of the Fund’s investments.","page_number":171,"box":{"x":116,"y":304,"width":627,"height":12}},{"id":"e68d0d3e-0e31-4268-b618-912af58b3ab6","block_type":"box","text":"The COVID-19 pandemic resulted in significant market volatility, exchange suspensions and closures,","page_number":171,"box":{"x":116,"y":335,"width":761,"height":12}},{"id":"610d7dd2-0734-4254-9c08-409d342fc5a6","block_type":"box","text":"declines in global financial markets, higher default rates, supply chain disruptions, and a substantial","page_number":171,"box":{"x":116,"y":351,"width":743,"height":12}},{"id":"dce212cb-3512-40e6-b80a-7bb933168ceb","block_type":"box","text":"economic downturn in economies throughout the world. The impact of this coronavirus, and other","page_number":171,"box":{"x":116,"y":366,"width":727,"height":12}},{"id":"16b6c118-6f4c-4b04-a3c9-7e0d7d35ee21","block_type":"box","text":"epidemics and pandemics that may arise in the future, could affect the economies of many nations,","page_number":171,"box":{"x":116,"y":382,"width":741,"height":12}},{"id":"a4cbfe72-1fe5-44cd-828b-bad990e4e03f","block_type":"box","text":"individual companies and the market in general in ways that cannot necessarily be foreseen at the","page_number":171,"box":{"x":117,"y":397,"width":733,"height":12}},{"id":"7f23759b-8a54-4859-8b99-bc4260a6c3c9","block_type":"box","text":"present time. These health crises may be short term or long term, and may exacerbate other pre","page_number":171,"box":{"x":117,"y":413,"width":721,"height":12}},{"id":"26fad3fe-15cf-46d5-8ec0-d01d379e2e55","block_type":"box","text":"existing political, social and economic risks, disrupt normal market conditions and operations, and","page_number":171,"box":{"x":116,"y":428,"width":729,"height":12}},{"id":"d50a92d9-7810-4432-8766-e420bfd04926","block_type":"box","text":"negatively impact performance. In addition, the impact of infectious diseases in emerging developing or","page_number":171,"box":{"x":117,"y":444,"width":771,"height":12}},{"id":"ae55ac04-20eb-4d92-b05f-1d5a4baf23cd","block_type":"box","text":"emerging market countries may be greater due to less established health care systems.","page_number":171,"box":{"x":116,"y":459,"width":657,"height":12}},{"id":"0fa7b750-60b5-48db-8654-252697e2a43f","block_type":"box","text":"Legal and Regulatory Risks.","page_number":171,"box":{"x":116,"y":490,"width":208,"height":12}},{"id":"b110e395-f836-4296-a96f-a77ed2c15b55","block_type":"box","text":"The Manager is part of a larger firm with multiple business lines active in","page_number":171,"box":{"x":326,"y":490,"width":547,"height":12}},{"id":"912777de-b49a-4e75-9c04-4516251e6353","block_type":"box","text":"multiple jurisdictions that are governed by a multitude of legal systems and regulatory regimes, some","page_number":171,"box":{"x":117,"y":506,"width":753,"height":12}},{"id":"a725ab8a-e771-4580-bae9-6283e3be5d7b","block_type":"box","text":"of which are new and evolving. As a result, the Funds and the Manager and its affiliates are subject to","page_number":171,"box":{"x":116,"y":521,"width":761,"height":12}},{"id":"0f46ebe8-cba9-458c-8b92-33d84b614ed7","block_type":"box","text":"extensive and sophisticated legal, tax and regulatory risks, including changing laws and regulations,","page_number":171,"box":{"x":116,"y":537,"width":746,"height":12}},{"id":"b5efef7f-9e6c-4316-94e6-f0a472fc8b31","block_type":"box","text":"developing interpretations of such laws and regulations, as well as existing laws, and increased","page_number":171,"box":{"x":116,"y":552,"width":712,"height":12}},{"id":"e8a5e565-7e71-468a-8a57-a1bb3cf5fd11","block_type":"box","text":"scrutiny by regulators and law enforcement authorities. Unexpected economic, political, regulatory and","page_number":171,"box":{"x":116,"y":568,"width":766,"height":12}},{"id":"34c5b039-0046-4a1b-974e-d68baf091520","block_type":"box","text":"diplomatic events within the United States and abroad can trigger new and complex regulations that","page_number":171,"box":{"x":116,"y":583,"width":745,"height":12}},{"id":"48b921b9-a1be-4805-b84c-bb5314de824d","block_type":"box","text":"the Manager and/or the Funds may need to comply with. The implementation of changes to comply","page_number":171,"box":{"x":116,"y":599,"width":742,"height":12}},{"id":"4a758dc7-c9de-48f1-a652-5dd620c33240","block_type":"box","text":"with current and/or new regulations applicable to the Funds and/or the Manager could have a material","page_number":171,"box":{"x":116,"y":614,"width":761,"height":12}},{"id":"5f36dcfe-10b3-4ade-b27a-101385d7ec73","block_type":"box","text":"adverse effect on the Funds (including by imposing material costs on the Funds, reducing profit","page_number":171,"box":{"x":116,"y":630,"width":712,"height":12}},{"id":"4808cc27-72a9-4186-bc06-3a1c8eeef454","block_type":"box","text":"margins, reducing investment opportunities or by otherwise restricting the Funds and/or the Manager).","page_number":171,"box":{"x":117,"y":645,"width":762,"height":12}},{"id":"b076715c-4e2a-4e2a-a6b9-3e381693a314","block_type":"box","text":"Tariff and Trade Policy Risks","page_number":171,"box":{"x":118,"y":676,"width":213,"height":12}},{"id":"09097fad-4006-4d3e-8d4d-fcd0f1e3a4cb","block_type":"box","text":".","page_number":171,"box":{"x":331,"y":684,"width":3,"height":2}},{"id":"23f2dc0f-43b3-4322-bcea-34d729dd0218","block_type":"box","text":"Some countries, including the U.S., have adopted more protectionist","page_number":171,"box":{"x":341,"y":676,"width":507,"height":12}},{"id":"49270ea6-67ea-4812-a2d9-75c94e378787","block_type":"box","text":"trade policies. The U.S. government recently altered its approach to international trade policy, resulting","page_number":171,"box":{"x":116,"y":692,"width":762,"height":12}},{"id":"666e0672-b85a-44c9-8fb7-1917d70e2b33","block_type":"box","text":"in significant impacts on international trade relations, certain tax and immigration policies, and other","page_number":171,"box":{"x":117,"y":707,"width":738,"height":12}},{"id":"75ed6f06-cb7c-406c-890c-68eda66d42c4","block_type":"box","text":"aspects of the national and international political and financial landscape. The rise in protectionist trade","page_number":171,"box":{"x":116,"y":723,"width":764,"height":12}},{"id":"ee9691b3-fe98-4488-983a-3f72cdcd0f58","block_type":"box","text":"policies, slowing economic growth, changes to some major international trade agreements, risks","page_number":171,"box":{"x":117,"y":738,"width":713,"height":12}},{"id":"d9ce6675-b923-4e4f-bb3a-7293a2f0b6b3","block_type":"box","text":"associated with trade agreements between the U.S. and the European Union, and the risks associated","page_number":171,"box":{"x":116,"y":754,"width":761,"height":12}},{"id":"23a8209d-5710-4f88-a282-d8ba9abc66cd","block_type":"box","text":"with trade negotiations between the U.S. and China, could affect the economies of many nations in","page_number":171,"box":{"x":116,"y":769,"width":733,"height":12}},{"id":"c6cb344d-ac99-466c-acb2-e5f5b19ba560","block_type":"box","text":"ways that cannot necessarily be foreseen at the present time.","page_number":171,"box":{"x":116,"y":785,"width":456,"height":12}},{"id":"f2779a48-9c02-4b1e-8428-5a18bab25ee0","block_type":"box","text":"Global trade disruption, significant introductions of trade barriers, and bilateral trade frictions, together","page_number":171,"box":{"x":117,"y":816,"width":754,"height":12}},{"id":"79e83585-d752-4208-adca-e05d5f3ecbfb","block_type":"box","text":"with any future downturns in the global economy resulting therefrom, could adversely affect the","page_number":171,"box":{"x":116,"y":831,"width":710,"height":12}},{"id":"87fc0ca6-b0b2-435d-9e0e-bf9968759782","block_type":"box","text":"financial performance of a Fund and its investments. Trade policy may be an ongoing source of","page_number":171,"box":{"x":116,"y":847,"width":713,"height":12}},{"id":"7a2c2724-d06b-4695-84a2-f3e4a22caaea","block_type":"box","text":"instability, potentially resulting in significant currency fluctuations and/or having other adverse effects","page_number":171,"box":{"x":117,"y":862,"width":751,"height":12}},{"id":"628fdf84-29bb-49f4-a488-b06f17ded180","block_type":"box","text":"on international markets, international trade agreements, and/or other existing cross-border","page_number":171,"box":{"x":116,"y":878,"width":683,"height":12}},{"id":"e0171246-4f62-401a-b5d3-80a5b12f454a","block_type":"box","text":"II-87","page_number":171,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"7dad7361-224e-41ff-9282-773cf3747102","block_type":"box","text":"NM0926U-5926888-171/257","page_number":171,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"6d9459cc-ce46-42ef-a07a-671217ee1044","block_type":"box","text":"cooperation arrangements (whether economic, tax, fiscal, legal, regulatory, or otherwise). To the extent","page_number":172,"box":{"x":116,"y":87,"width":771,"height":12}},{"id":"fcd244ae-7e63-4c92-b59f-61ea9eb2ada3","block_type":"box","text":"trade disputes escalate globally, there could be additional significant impacts on the sectors or","page_number":172,"box":{"x":116,"y":102,"width":704,"height":13}},{"id":"fe7b7865-af6e-46c6-a9fd-bd8d3d25d1ac","block_type":"box","text":"industries in which a Fund invests and other adverse impacts on a Fund’s overall performance.","page_number":172,"box":{"x":117,"y":118,"width":709,"height":12}},{"id":"79e38a5c-0ad0-4cca-9593-9ad1a72e06a5","block_type":"box","text":"Geographic Risks","page_number":172,"box":{"x":117,"y":149,"width":131,"height":12}},{"id":"c95c9668-9a70-4236-9aa0-33104995ce13","block_type":"box","text":". Some of the companies in which the Fund invests may be located in, or otherwise","page_number":172,"box":{"x":250,"y":149,"width":621,"height":12}},{"id":"ee440016-7a86-4243-8d1f-5139c787585a","block_type":"box","text":"connected to, parts of the world affected by natural disasters such as severe heat, earthquakes,","page_number":172,"box":{"x":116,"y":165,"width":717,"height":12}},{"id":"26d1da37-7ef0-4870-8dc2-ca4ef6c95336","block_type":"box","text":"tornadoes, volcanic eruptions, wildfires, droughts, floods, hurricanes or tsunamis, and are economically","page_number":172,"box":{"x":116,"y":180,"width":771,"height":12}},{"id":"0482d9b6-5ba8-472b-a4e3-c54b67c64682","block_type":"box","text":"sensitive to environmental events. In addition, issuers may be impacted by security concerns with","page_number":172,"box":{"x":116,"y":196,"width":729,"height":12}},{"id":"baf55268-dd85-4305-b16c-c2d16f06c00f","block_type":"box","text":"respect to a country or region, such as war and other types of conflict, terrorism, strained international","page_number":172,"box":{"x":117,"y":211,"width":760,"height":12}},{"id":"67628eb9-d1e3-4c51-9054-44cdcf52dc71","block_type":"box","text":"relations and territorial disputes. Any of these events may adversely affect the issuers, markets and","page_number":172,"box":{"x":117,"y":227,"width":742,"height":12}},{"id":"c005f48d-51a6-4124-99e6-6bce24955358","block_type":"box","text":"economies to which a Fund is exposed, which may adversely affect the value of the Fund.","page_number":172,"box":{"x":116,"y":242,"width":673,"height":12}},{"id":"820946f9-74e1-4fa1-86a5-7035df32be6e","block_type":"box","text":"Reference Rate Replacement Risk.","page_number":172,"box":{"x":116,"y":273,"width":275,"height":12}},{"id":"1357b411-99b8-45c9-8202-7162be210b38","block_type":"box","text":"A Fund’s investments, payment obligations and financing terms","page_number":172,"box":{"x":393,"y":273,"width":480,"height":12}},{"id":"577fa73e-8178-43df-9f62-a1258c6dad98","block_type":"box","text":"may be based on floating rates, such as the Secured Overnight Financing Rate (“SOFR”), Sterling","page_number":172,"box":{"x":117,"y":289,"width":732,"height":12}},{"id":"7f60ac87-a91e-4987-9273-0908a9fcfa8f","block_type":"box","text":"Overnight Interbank Average Rate (“SONIA”), and other similar types of reference rates (“Reference","page_number":172,"box":{"x":116,"y":304,"width":749,"height":12}},{"id":"d4174baa-9fc2-4638-8b1b-7282bc547215","block_type":"box","text":"Rates”). The elimination of a Reference Rate or any other changes or reforms to the determination or","page_number":172,"box":{"x":117,"y":320,"width":755,"height":12}},{"id":"229f3044-b0de-4e3c-ae46-b893cf6b0333","block_type":"box","text":"supervision of a Reference Rate could have an adverse impact on the market for, or value of, any","page_number":172,"box":{"x":116,"y":335,"width":730,"height":12}},{"id":"50cb3505-d239-4c17-aa5e-4971e7510a43","block_type":"box","text":"instruments (including debt instruments and certain derivative instruments) or payments linked to those","page_number":172,"box":{"x":117,"y":351,"width":769,"height":12}},{"id":"44fb28e6-9179-47b7-9efc-fe37c74be97f","block_type":"box","text":"Reference Rates. In addition, any substitute Reference Rate and any pricing adjustments imposed by","page_number":172,"box":{"x":117,"y":366,"width":758,"height":12}},{"id":"e1946ff3-cb63-452c-b7bb-a1e383e074d2","block_type":"box","text":"a regulator or by counterparties or otherwise may adversely affect a Fund’s performance and/or net","page_number":172,"box":{"x":116,"y":382,"width":743,"height":12}},{"id":"a19df401-b19c-42a3-a19b-ef167991ba7f","block_type":"box","text":"asset value.","page_number":172,"box":{"x":116,"y":397,"width":94,"height":10}},{"id":"658493f2-9baa-4c38-b23b-37d19f6f21c9","block_type":"box","text":"The London Interbank Offered Rate (“LIBOR”) had historically been used extensively in the U.S. and","page_number":172,"box":{"x":116,"y":428,"width":751,"height":12}},{"id":"01dcab47-2268-4d61-aed9-74a198a269f2","block_type":"box","text":"globally as a “benchmark” or “reference rate” for various commercial and financial contracts, including","page_number":172,"box":{"x":116,"y":444,"width":760,"height":12}},{"id":"422dbedc-3a24-47c4-ab5b-22b0ac80cb82","block_type":"box","text":"corporate and municipal bonds, bank loans, asset-backed and mortgage-related securities, interest","page_number":172,"box":{"x":116,"y":459,"width":741,"height":12}},{"id":"f32e527e-8012-4a26-82cf-d850b0a8adb6","block_type":"box","text":"rate swaps and other derivatives. Instruments in which a Fund may have historically paid interest at","page_number":172,"box":{"x":117,"y":475,"width":742,"height":12}},{"id":"69903fcb-067b-4328-9738-b6d80fab0592","block_type":"box","text":"floating rates based on LIBOR or may have been subject to interest caps or floors based on LIBOR.","page_number":172,"box":{"x":116,"y":490,"width":746,"height":12}},{"id":"aa01358d-ab23-4c6b-92f8-6d8c069bba3c","block_type":"box","text":"The Funds and issuers of instruments in which a Fund invests may have also historically obtained","page_number":172,"box":{"x":116,"y":506,"width":731,"height":12}},{"id":"62c1c3f7-d27a-46c7-a356-3cdf71ba0488","block_type":"box","text":"financing at floating rates based on LIBOR. In connection with the global transition away from LIBOR","page_number":172,"box":{"x":116,"y":521,"width":753,"height":12}},{"id":"02b14b93-0f42-42e3-b267-3fc1d9caab1e","block_type":"box","text":"led by regulators and market participants as a result of benchmark reforms, LIBOR was last published","page_number":172,"box":{"x":117,"y":537,"width":761,"height":12}},{"id":"3494c7dc-691a-4139-a477-0f80e1216ee7","block_type":"box","text":"on a representative basis at the end of June 2023. Alternative Reference Rates to LIBOR have been","page_number":172,"box":{"x":116,"y":552,"width":751,"height":12}},{"id":"0185eb14-a583-4c1e-9858-816c0525e1bd","block_type":"box","text":"established in most major currencies and markets in these alternative rates are continuing to develop","page_number":172,"box":{"x":116,"y":568,"width":756,"height":12}},{"id":"6cd92f9d-b6fe-4af4-b434-f9f30d95463a","block_type":"box","text":"(","page_number":172,"box":{"x":117,"y":583,"width":4,"height":12}},{"id":"0cbf3fd9-a0a8-4aaf-ad49-e2fe466abd58","block_type":"box","text":"e.g.","page_number":172,"box":{"x":122,"y":586,"width":26,"height":9}},{"id":"a1a43340-88b2-4beb-99c1-5140764b3cf6","block_type":"box","text":", SOFR for USD-LIBOR and SONIA for GBP-LIBOR). While the transition from LIBOR has gone","page_number":172,"box":{"x":151,"y":583,"width":716,"height":12}},{"id":"aa4d9193-f924-4ee8-adee-4f27b4408223","block_type":"box","text":"relatively smoothly, residual risks associated with the transition may remain that may impact markets or","page_number":172,"box":{"x":117,"y":599,"width":771,"height":12}},{"id":"565bd435-c74c-4111-b8c5-c28255c59cc2","block_type":"box","text":"particular investments and, as such, the full impact of the transition on the Funds or the financial","page_number":172,"box":{"x":117,"y":614,"width":718,"height":12}},{"id":"1f7e85ad-b7f1-44d9-9914-fa982c744c7c","block_type":"box","text":"instruments in which the Funds invest cannot yet be fully determined.","page_number":172,"box":{"x":117,"y":630,"width":518,"height":12}},{"id":"87bd70f2-4e08-440f-8f03-6f7327162e1f","block_type":"box","text":"SOFR is intended to be a broad measure of the cost of borrowing funds overnight in transactions that","page_number":172,"box":{"x":116,"y":661,"width":752,"height":12}},{"id":"a759e1e2-f030-481d-9664-78ee01b73951","block_type":"box","text":"are collateralized by U.S. Treasury securities . SOFR is calculated based on transaction-level repo","page_number":172,"box":{"x":116,"y":676,"width":731,"height":12}},{"id":"a3272d1e-ad62-49c2-a55a-7d2cae9ecd0f","block_type":"box","text":"data collected from various sources. For each trading day, SOFR is calculated as a volume-weighted","page_number":172,"box":{"x":116,"y":692,"width":749,"height":12}},{"id":"9bbb582a-16f7-4d1f-b9e9-9e4e8061ebc6","block_type":"box","text":"median rate derived from such data. Because SOFR is a financing rate based on overnight secured","page_number":172,"box":{"x":117,"y":707,"width":738,"height":12}},{"id":"7e656b73-3e97-47ef-ac29-aa3f781d24e1","block_type":"box","text":"funding transactions, it differs fundamentally from LIBOR. LIBOR is intended to be an unsecured rate","page_number":172,"box":{"x":116,"y":723,"width":750,"height":12}},{"id":"ca778cc4-8804-4000-8c2b-f957dd25ec29","block_type":"box","text":"that represents interbank funding costs for different short-term maturities or tenors. It is a forward","page_number":172,"box":{"x":116,"y":738,"width":726,"height":12}},{"id":"3850a7ba-42ad-46e0-b9cc-92d7226fae66","block_type":"box","text":"looking rate reflecting expectations regarding interest rates for the applicable tenor. Thus, LIBOR is","page_number":172,"box":{"x":117,"y":754,"width":734,"height":12}},{"id":"2165a057-6315-4c1a-add8-7379ce4bc58f","block_type":"box","text":"intended to be sensitive, in certain respects, to bank credit risk and to term interest rate risk. In","page_number":172,"box":{"x":117,"y":769,"width":700,"height":12}},{"id":"0cb40d3a-3512-419c-926b-a451b4f172ea","block_type":"box","text":"contrast, SOFR is a secured overnight rate reflecting the credit of U.S. Treasury securities as","page_number":172,"box":{"x":116,"y":785,"width":691,"height":12}},{"id":"60e9e4c8-2247-4477-b7d3-b63b457330c5","block_type":"box","text":"collateral. Thus, it is largely insensitive to credit-risk considerations and to short-term interest rate risks.","page_number":172,"box":{"x":116,"y":800,"width":765,"height":12}},{"id":"912edc85-ed2d-4f81-addb-04b9068d7317","block_type":"box","text":"SOFR is a transaction-based rate, and it has been more volatile than other benchmark or market rates,","page_number":172,"box":{"x":116,"y":816,"width":764,"height":11}},{"id":"b011a899-4607-4506-9c55-83d9d24fca16","block_type":"box","text":"such as three-month LIBOR, during certain periods. For these reasons, among others, there is no","page_number":172,"box":{"x":116,"y":831,"width":730,"height":12}},{"id":"cbc11781-a0ad-49c1-a156-6c137a4453e8","block_type":"box","text":"assurance that SOFR, or rates derived from SOFR, will perform in the same or similar way as LIBOR","page_number":172,"box":{"x":116,"y":847,"width":755,"height":12}},{"id":"8458c677-131d-40fb-a3b2-3a34a9298dc4","block_type":"box","text":"would have performed at any time, and there is no assurance that SOFR-based rates will be a suitable","page_number":172,"box":{"x":116,"y":862,"width":767,"height":12}},{"id":"022fd759-fd47-455d-a0a0-3165a48af000","block_type":"box","text":"substitute for LIBOR. SOFR has a relatively limited history, having been first published in April 2018.","page_number":172,"box":{"x":116,"y":878,"width":749,"height":12}},{"id":"dba99b54-d26d-4448-999a-2d3c739aa103","block_type":"box","text":"II-88","page_number":172,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"09bbc6ff-6837-4966-998f-a073e737ae8c","block_type":"box","text":"NM0926U-5926888-172/257","page_number":172,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"e2d2fe22-214f-4e7b-b743-526332d5cf64","block_type":"box","text":"The future performance of SOFR, and SOFR-based","page_number":173,"box":{"x":116,"y":87,"width":383,"height":12}},{"id":"5d6588f1-10cb-4ea7-afb2-792e5208e309","block_type":"box","text":"Reference Rates, cannot be predicted based on","page_number":173,"box":{"x":501,"y":87,"width":353,"height":12}},{"id":"1dc3563e-128e-4b92-a509-329bc2648c63","block_type":"box","text":"SOFR’s history or otherwise. Levels of SOFR in the futu","page_number":173,"box":{"x":116,"y":102,"width":406,"height":13}},{"id":"c64de5a2-c49c-4d0e-ad67-7a8357b25eb5","block_type":"box","text":"re may bear little or no relation to historical levels","page_number":173,"box":{"x":524,"y":103,"width":359,"height":12}},{"id":"743fa858-df6a-4b1d-a7b9-0e2ddbffc8d1","block_type":"box","text":"of SOFR, LIBOR or other rates. There can also","page_number":173,"box":{"x":116,"y":118,"width":348,"height":11}},{"id":"7b55b606-6930-4d75-8921-2614707d9c5e","block_type":"box","text":"be no assurance that SOFR will not be discontinued or","page_number":173,"box":{"x":465,"y":118,"width":401,"height":10}},{"id":"75cc348e-32f2-4ec8-a34c-cc7efc0fb2f5","block_type":"box","text":"fundamentally altered in a manner that is mate","page_number":173,"box":{"x":116,"y":134,"width":338,"height":12}},{"id":"56966a56-92d0-499f-ba2b-ccde107fa8b6","block_type":"box","text":"rially adverse to the interests of the Fund.","page_number":173,"box":{"x":455,"y":134,"width":306,"height":12}},{"id":"59aee407-be90-408d-a61e-4b47454072f6","block_type":"box","text":"In addition, interest rates or other types of rates and indices which are classified as “benchmarks” have","page_number":173,"box":{"x":117,"y":161,"width":768,"height":13}},{"id":"191b84ac-9cac-4e00-a273-050c58db62cd","block_type":"box","text":"been the subject of ongoing national and international regulatory reform, including under the European","page_number":173,"box":{"x":117,"y":177,"width":765,"height":12}},{"id":"721524bc-0b90-480d-904f-0d2d46171003","block_type":"box","text":"Union (“EU”) regulation on indices used as benchmarks in financial instruments and financial contracts","page_number":173,"box":{"x":117,"y":192,"width":765,"height":13}},{"id":"7d7826f2-5253-4f1d-bb8c-246bb445782a","block_type":"box","text":"(known as the “Benchmarks Regulation”). The Benchmarks Regulation has been enacted into United","page_number":173,"box":{"x":117,"y":208,"width":754,"height":12}},{"id":"4ff2789a-c264-447b-a6ce-c29a6ead32be","block_type":"box","text":"Kingdom (“UK”) law by virtue of the EU (Withdrawal) Act 2018 (as amended), subject to amendments","page_number":173,"box":{"x":117,"y":223,"width":756,"height":13}},{"id":"686b4559-710c-4150-8d03-b7fdad9d6881","block_type":"box","text":"made by the Benchmarks (Amendment and Transitional Provision) (EU Exit) Regulations 2019 (SI","page_number":173,"box":{"x":117,"y":239,"width":733,"height":12}},{"id":"ed72c76b-1d1d-4d6a-af6b-b015232a99aa","block_type":"box","text":"2019/657) and other statutory instruments. Following the implementation of these reforms, the manner","page_number":173,"box":{"x":116,"y":254,"width":765,"height":13}},{"id":"fae55930-4441-4429-b9c8-fd2e83c52dbe","block_type":"box","text":"of administration of benchmarks has changed and may further change in the future, with the result that","page_number":173,"box":{"x":116,"y":270,"width":766,"height":12}},{"id":"206490dc-0a84-4ff5-97a7-ffc7dd44541c","block_type":"box","text":"relevant benchmarks may perform differently than in the past, the use of benchmarks that are not","page_number":173,"box":{"x":117,"y":285,"width":726,"height":13}},{"id":"1a51f04b-4052-4aeb-be27-25b48bdc3814","block_type":"box","text":"compliant with the new standards by certain supervised entities may be restricted, and certain","page_number":173,"box":{"x":116,"y":301,"width":702,"height":12}},{"id":"a3a48ffa-c0e1-417b-9581-ae7c49557f60","block_type":"box","text":"benchmarks may be eliminated entirely. Such changes could cause increased market volatility and","page_number":173,"box":{"x":117,"y":316,"width":737,"height":13}},{"id":"78a7c631-b95f-4ab9-92e9-9c4ecf5497c8","block_type":"box","text":"disruptions in liquidity for instruments that rely on or are impacted by such benchmarks. Additionally,","page_number":173,"box":{"x":116,"y":332,"width":749,"height":12}},{"id":"8e3c7b59-0ec8-481c-b51c-44f29379b6c2","block_type":"box","text":"there could be other consequences which cannot be predicted.","page_number":173,"box":{"x":116,"y":348,"width":472,"height":11}},{"id":"28c5b860-4182-44e6-a99a-fbd597c2922c","block_type":"box","text":"Repurchase Agreements and Purchase and Sale Contracts.","page_number":173,"box":{"x":116,"y":375,"width":479,"height":12}},{"id":"93707f28-a36e-4f31-8695-11bceb82ee15","block_type":"box","text":"Under repurchase agreements and","page_number":173,"box":{"x":597,"y":376,"width":264,"height":11}},{"id":"b5b674bb-f969-49cb-b2b2-642504c37e8c","block_type":"box","text":"purchase and sale contracts, the other party agrees, upon entering into the contract with a Fund, to","page_number":173,"box":{"x":117,"y":391,"width":740,"height":12}},{"id":"445b3e8c-8255-46cf-ad07-a0cf8b501d47","block_type":"box","text":"repurchase a security sold to the Fund at a mutually agreed-upon time and price in a specified","page_number":173,"box":{"x":117,"y":406,"width":703,"height":12}},{"id":"899ad8cd-a9d1-43f7-bdfb-2133d974ea21","block_type":"box","text":"currency, thereby determining the yield during the term of the agreement.","page_number":173,"box":{"x":116,"y":422,"width":549,"height":12}},{"id":"51dfe734-0dc0-4f54-b18b-214267bdeb99","block_type":"box","text":"A purchase and sale contract differs from a repurchase agreement in that the contract arrangements","page_number":173,"box":{"x":116,"y":450,"width":751,"height":12}},{"id":"bac25ffa-2ce2-488f-aec4-a83b2132f1d1","block_type":"box","text":"stipulate that securities are owned by the Fund and the purchaser receives any interest on the security","page_number":173,"box":{"x":116,"y":465,"width":766,"height":12}},{"id":"5fde4919-da16-4ef7-8b4e-4bbd2a9d1213","block_type":"box","text":"paid during the period. In the case of repurchase agreements, the prices at which the trades are","page_number":173,"box":{"x":117,"y":481,"width":717,"height":12}},{"id":"80c39a08-1bd8-4409-b9ee-2d7b5bcf7f5b","block_type":"box","text":"conducted do not reflect accrued interest on the underlying obligation; whereas, in the case of","page_number":173,"box":{"x":116,"y":496,"width":701,"height":12}},{"id":"838beba9-1cbb-4617-aa72-587d7ceb49ee","block_type":"box","text":"purchase and sale contracts, the prices take into account accrued interest. A Fund may enter into","page_number":173,"box":{"x":117,"y":512,"width":728,"height":12}},{"id":"6554dfe6-77a3-49f5-ba5e-766397aebff3","block_type":"box","text":"“tri-party” repurchase agreements. In “tri-party” repurchase agreements, an unaffiliated third-party","page_number":173,"box":{"x":116,"y":527,"width":729,"height":12}},{"id":"122b97ae-1cab-4b09-92a5-a91bfc3cfe30","block_type":"box","text":"custodian maintains accounts to hold collateral for the Fund and its counterparties and, therefore, the","page_number":173,"box":{"x":116,"y":543,"width":756,"height":12}},{"id":"3be97af6-02b9-4f1b-8ad2-5e0d83b0188a","block_type":"box","text":"Fund may be subject to the credit risk of those custodians.","page_number":173,"box":{"x":117,"y":558,"width":438,"height":12}},{"id":"20503cdf-d8ad-40c2-b8bc-8e36f4b08fe4","block_type":"box","text":"Some repurchase agreements and purchase and sale contracts are structured to result in a fixed rate","page_number":173,"box":{"x":116,"y":586,"width":758,"height":12}},{"id":"6f705e03-f3c7-460b-9719-4f00ba540d2c","block_type":"box","text":"of return insulated from market fluctuations during the term of the agreement, although such return","page_number":173,"box":{"x":116,"y":602,"width":737,"height":12}},{"id":"a0721ef4-62e8-4f1b-9b65-b745a99d8051","block_type":"box","text":"may be affected by currency fluctuations. However, in the event of a default under a repurchase","page_number":173,"box":{"x":117,"y":617,"width":716,"height":12}},{"id":"15b5a703-21f0-4d7b-91ac-68e7cbd8c749","block_type":"box","text":"agreement or under a purchase and sale contract, instead of the contractual fixed rate, the rate of","page_number":173,"box":{"x":116,"y":633,"width":730,"height":12}},{"id":"b99ada76-93a1-4e57-96f9-4e52b1c12bfc","block_type":"box","text":"return to the Fund would be dependent upon intervening fluctuations of the market values of the","page_number":173,"box":{"x":117,"y":648,"width":716,"height":12}},{"id":"5ca4c501-203a-4b71-90be-9a5d38049e5f","block_type":"box","text":"securities underlying the contract and the accrued interest on those securities. In such event, the Fund","page_number":173,"box":{"x":116,"y":664,"width":760,"height":12}},{"id":"8780cf14-9c73-4aa1-b70d-e77f3c107136","block_type":"box","text":"would have rights against the seller for breach of contract with respect to any losses arising from","page_number":173,"box":{"x":116,"y":679,"width":715,"height":12}},{"id":"28056c4c-7401-4abe-b95d-b6bac679e8e8","block_type":"box","text":"market fluctuations following the default.","page_number":173,"box":{"x":117,"y":695,"width":297,"height":12}},{"id":"1830cc1e-fb2c-4913-8da3-548856c2e9b7","block_type":"box","text":"Both types of agreement usually cover short periods, such as less than one week, although they may","page_number":173,"box":{"x":117,"y":723,"width":742,"height":12}},{"id":"aec721a4-2624-49b6-8d9f-55cada0572f1","block_type":"box","text":"have longer terms, and may be construed to be collateralized loans by the purchaser to the seller","page_number":173,"box":{"x":117,"y":738,"width":714,"height":12}},{"id":"b09e3c11-9229-4812-8ed4-144e394c609c","block_type":"box","text":"secured by the securities transferred to the purchaser. In the case of a repurchase agreement, as a","page_number":173,"box":{"x":116,"y":754,"width":730,"height":12}},{"id":"53715e0a-4d49-49b5-b10d-8cd5a510c171","block_type":"box","text":"purchaser, a Fund’s Manager or sub-adviser will monitor the creditworthiness of the seller, and a Fund","page_number":173,"box":{"x":117,"y":769,"width":750,"height":12}},{"id":"d14e0f8d-3c92-4d9c-925e-5022beabc446","block_type":"box","text":"will require the seller to provide additional collateral if the market value of the securities falls below the","page_number":173,"box":{"x":116,"y":785,"width":748,"height":12}},{"id":"f4601599-02f6-4151-b826-9cd754abe964","block_type":"box","text":"repurchase price at any time during the term of the repurchase agreement. The Fund does not have this","page_number":173,"box":{"x":117,"y":800,"width":764,"height":12}},{"id":"ceaf6fa2-cd93-4faa-9794-0139e685fadc","block_type":"box","text":"right to seek additional collateral as a purchaser in the case of purchase and sale contracts. The Fund’s","page_number":173,"box":{"x":117,"y":816,"width":760,"height":12}},{"id":"a363f8bd-026c-498b-8c0d-ed432c2624cb","block_type":"box","text":"Manager or sub-adviser will mark-to-market daily the value of the securities. Securities subject to","page_number":173,"box":{"x":117,"y":831,"width":715,"height":12}},{"id":"aba7223f-21bb-43ac-a3df-fffc56ed8c04","block_type":"box","text":"repurchase agreements (other than tri-party repurchase agreements) and purchase and sale contracts","page_number":173,"box":{"x":117,"y":847,"width":757,"height":12}},{"id":"8e2efadd-7078-43b6-8ea7-b2b31c9cb0ef","block_type":"box","text":"will be held by the Fund’s custodian (or sub-custodian) in the Federal Reserve/Treasury book-entry","page_number":173,"box":{"x":116,"y":862,"width":733,"height":12}},{"id":"86aee986-63f9-40a0-b015-663a31cb97ab","block_type":"box","text":"system or by another authorized securities depository.","page_number":173,"box":{"x":116,"y":878,"width":403,"height":12}},{"id":"1dab8d2b-723e-4e23-bb70-90a08d06446e","block_type":"box","text":"II-89","page_number":173,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"ccbb4d4b-4a7e-4524-8bad-623d8e7513f2","block_type":"box","text":"NM0926U-5926888-173/257","page_number":173,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"48c91b29-02fe-4df2-a89f-b6cb30fd4222","block_type":"box","text":"In the event of default by the seller under a repurchase agreement construed to be a collateralized loan,","page_number":174,"box":{"x":117,"y":87,"width":750,"height":12}},{"id":"07801c82-6548-4ec1-9e29-a939c923277a","block_type":"box","text":"the underlying securities are not owned by the Fund but only constitute collateral for the seller’s obligation","page_number":174,"box":{"x":116,"y":102,"width":763,"height":13}},{"id":"05b50337-37d9-4324-aee1-91dba04f1144","block_type":"box","text":"to pay the repurchase price. Therefore, the Fund may suffer time delays and incur costs or possible losses","page_number":174,"box":{"x":116,"y":118,"width":770,"height":12}},{"id":"f843a04d-92e4-4859-932c-eb941e9dc11c","block_type":"box","text":"in connection with disposition of the collateral. If the seller becomes insolvent and subject to liquidation or","page_number":174,"box":{"x":117,"y":134,"width":759,"height":12}},{"id":"07752af3-1d0d-427b-94ef-b2ceca1cb5be","block_type":"box","text":"reorganization under applicable bankruptcy or other laws, a Fund’s ability to dispose of the underlying","page_number":174,"box":{"x":117,"y":149,"width":733,"height":12}},{"id":"fdd79005-1714-4b36-8140-7591e7496807","block_type":"box","text":"securities may be restricted. Finally, it is possible that a Fund may not be able to substantiate its interest in","page_number":174,"box":{"x":116,"y":165,"width":769,"height":12}},{"id":"b65cd2e6-75f6-4c50-8578-8ea838dc775f","block_type":"box","text":"the underlying securities. To minimize this risk, the securities underlying the repurchase agreement will be","page_number":174,"box":{"x":116,"y":180,"width":766,"height":12}},{"id":"d0e5020b-c1e7-46e0-9e7b-a8ddd48fcc08","block_type":"box","text":"held by the applicable custodian at all times in an amount at least equal to the repurchase price, including","page_number":174,"box":{"x":117,"y":196,"width":761,"height":12}},{"id":"3dad519c-8caa-4996-91c8-544c7a292571","block_type":"box","text":"accrued interest. If the seller fails to repurchase the securities, a Fund may suffer a loss to the extent","page_number":174,"box":{"x":116,"y":211,"width":727,"height":12}},{"id":"47c56eab-ae98-48ae-b119-ba377a12fe22","block_type":"box","text":"proceeds from the sale of the underlying securities are less than the repurchase price.","page_number":174,"box":{"x":117,"y":227,"width":622,"height":12}},{"id":"dca43d4e-a8d2-49fd-b78f-44a09ee293bb","block_type":"box","text":"In any repurchase transaction to which a Fund is a party, collateral for a repurchase agreement may","page_number":174,"box":{"x":117,"y":258,"width":747,"height":12}},{"id":"e9d57069-2d08-41d3-b4f1-9c9fe8437cae","block_type":"box","text":"include cash items and obligations issued by the U.S. Government or its agencies or instrumentalities.","page_number":174,"box":{"x":117,"y":273,"width":762,"height":12}},{"id":"2728ee03-9eaa-4b1d-840a-35560b5116ee","block_type":"box","text":"For certain Funds, however, collateral may include instruments other than cash items and obligations","page_number":174,"box":{"x":117,"y":289,"width":755,"height":12}},{"id":"b6e61682-d277-4857-873c-69f54784c463","block_type":"box","text":"issued by the U.S. Government or its agencies or instrumentalities, including securities that the Fund","page_number":174,"box":{"x":117,"y":304,"width":752,"height":12}},{"id":"63176974-d5b8-4664-925d-22e1b4f793ef","block_type":"box","text":"could not hold directly under its investment strategies without the repurchase obligation.","page_number":174,"box":{"x":116,"y":320,"width":657,"height":12}},{"id":"b1dc0103-54b1-4d8f-b75d-8eb1b80f6e4e","block_type":"box","text":"The type of collateral underlying repurchase agreements may also pose certain risks for a Fund. Lower","page_number":174,"box":{"x":116,"y":351,"width":770,"height":12}},{"id":"fe2ceb93-c968-4e7f-a9ea-6a954bdb9dfa","block_type":"box","text":"quality collateral and collateral with longer maturities may be subject to greater price fluctuations than","page_number":174,"box":{"x":116,"y":366,"width":757,"height":12}},{"id":"a70de7d7-21e6-454c-a79d-49ce1e8c148e","block_type":"box","text":"higher quality collateral and collateral with shorter maturities. If the repurchase agreement counterparty","page_number":174,"box":{"x":117,"y":382,"width":769,"height":12}},{"id":"00d1bac3-d51e-43e6-b0f2-c5ea53b8c26a","block_type":"box","text":"were to default, lower quality collateral may be more difficult to liquidate than higher quality collateral.","page_number":174,"box":{"x":116,"y":397,"width":755,"height":12}},{"id":"a7d0179b-19df-4aaa-aa70-37c101d10d50","block_type":"box","text":"Should the counterparty default and the amount of collateral not be sufficient to cover the","page_number":174,"box":{"x":116,"y":413,"width":666,"height":12}},{"id":"d4bb76af-eda8-4883-bf61-677dc997a4f1","block_type":"box","text":"counterparty’s repurchase obligation, a Fund would retain the status of an unsecured creditor of the","page_number":174,"box":{"x":116,"y":428,"width":744,"height":12}},{"id":"9b1514d4-d4c8-4777-8b15-09e4e31b3e05","block_type":"box","text":"counterparty (","page_number":174,"box":{"x":116,"y":444,"width":103,"height":12}},{"id":"7f83366c-dc00-47a6-aa77-f035a2eb7086","block_type":"box","text":"i.e.","page_number":174,"box":{"x":220,"y":444,"width":20,"height":9}},{"id":"c21acf71-e5b0-4505-a0db-84b242133626","block_type":"box","text":", the position the Fund would normally be in if it were to hold, pursuant to its","page_number":174,"box":{"x":244,"y":444,"width":565,"height":12}},{"id":"8797bf8f-d2a5-44eb-aa04-c98c3b940e89","block_type":"box","text":"investment policies, other unsecured debt securities of the defaulting counterparty) with respect to the","page_number":174,"box":{"x":117,"y":459,"width":760,"height":12}},{"id":"b588e9b1-443b-4d7f-b698-5b9460ea7d7f","block_type":"box","text":"amount of the shortfall. As an unsecured creditor, a Fund would be at risk of losing some or all of the","page_number":174,"box":{"x":116,"y":475,"width":752,"height":12}},{"id":"6ea096c9-ca0e-4b2c-8d00-4c7d54598105","block_type":"box","text":"principal and income involved in the transaction.","page_number":174,"box":{"x":117,"y":490,"width":361,"height":12}},{"id":"1be7cba5-4228-438a-92fe-70003b5487fe","block_type":"box","text":"Regulations adopted by global prudential regulators require certain bank-regulated counterparties and","page_number":174,"box":{"x":117,"y":521,"width":761,"height":12}},{"id":"b26a4fe5-402d-41f6-9138-c7f7f310111d","block_type":"box","text":"certain of their affiliates to include in certain financial contracts, including many repurchase agreements","page_number":174,"box":{"x":116,"y":537,"width":771,"height":12}},{"id":"464b8859-fa1e-41f8-9e20-f22946a7e655","block_type":"box","text":"and purchase and sale contracts, terms that delay or restrict the rights of counterparties, such as a","page_number":174,"box":{"x":116,"y":552,"width":738,"height":12}},{"id":"be9627a3-d367-4925-b3de-8370527a11b4","block_type":"box","text":"Fund, to terminate such agreements, take foreclosure action, exercise other default rights or restrict","page_number":174,"box":{"x":117,"y":568,"width":744,"height":12}},{"id":"5cdb0682-25df-4b33-a478-e914c0399ffd","block_type":"box","text":"transfers of credit support in the event that the counterparty and/or its affiliates are subject to certain","page_number":174,"box":{"x":116,"y":583,"width":748,"height":12}},{"id":"4e7fda19-b218-4d7a-90d4-02c18bacf635","block_type":"box","text":"types of resolution or insolvency proceedings. It is possible that these requirements, as well as","page_number":174,"box":{"x":116,"y":599,"width":707,"height":12}},{"id":"f46cad37-5c49-4b3f-b778-f6a8c2b99551","block_type":"box","text":"potential additional government regulation and other developments in the market, could adversely","page_number":174,"box":{"x":117,"y":614,"width":729,"height":12}},{"id":"6b1053d9-3e05-46aa-8576-91c84c953f37","block_type":"box","text":"affect a Fund’s ability to terminate existing repurchase agreements and purchase and sale contracts or","page_number":174,"box":{"x":116,"y":630,"width":768,"height":12}},{"id":"2b836410-db7d-4da0-b776-cc7727057ee0","block_type":"box","text":"to realize amounts to be received under such agreements. The SEC has also finalized rules that will","page_number":174,"box":{"x":116,"y":645,"width":747,"height":12}},{"id":"991283e0-9d57-42be-8a29-f04121207abe","block_type":"box","text":"require certain transactions involving U.S. Treasuries, including repurchase agreements, to be centrally","page_number":174,"box":{"x":117,"y":661,"width":766,"height":12}},{"id":"02076d4a-b32d-42de-99ff-ebb2bbdd28a4","block_type":"box","text":"cleared. Compliance with these rules is expected to be required by the middle of 2027. Although the","page_number":174,"box":{"x":116,"y":676,"width":742,"height":12}},{"id":"3aca865b-fc67-4c3b-b857-465e1f2f2f2e","block_type":"box","text":"impact of these rules on the Funds is difficult to predict, they may reduce the availability or increase the","page_number":174,"box":{"x":117,"y":692,"width":765,"height":12}},{"id":"51c3b08e-50e8-484a-9a33-563a91b4272a","block_type":"box","text":"costs of such transactions and may adversely affect a Fund’s performance.","page_number":174,"box":{"x":116,"y":707,"width":557,"height":12}},{"id":"8ac56081-5cb6-4744-a351-d8897c1d5fb8","block_type":"box","text":"Restricted Securities.","page_number":174,"box":{"x":116,"y":738,"width":171,"height":10}},{"id":"91865c76-f15a-4522-90fe-f73a9d1286fb","block_type":"box","text":"A Fund may invest in or hold securities that are not registered under the","page_number":174,"box":{"x":293,"y":738,"width":533,"height":12}},{"id":"a557f943-e1a8-4291-b644-70399c0665df","block_type":"box","text":"Securities Act (“restricted securities”), which may include securities in private companies and Rule","page_number":174,"box":{"x":116,"y":754,"width":728,"height":12}},{"id":"70303be6-6f31-4843-a2d5-9cd7a0ff8c08","block_type":"box","text":"144A Securities. Restricted securities may be sold in private placement transactions between issuers","page_number":174,"box":{"x":118,"y":769,"width":748,"height":12}},{"id":"f8047e54-2643-47aa-9273-542d967ff4b7","block_type":"box","text":"and their purchasers, including through private negotiated transactions between the issuer and their","page_number":174,"box":{"x":116,"y":785,"width":741,"height":12}},{"id":"cf59655f-8b99-421d-a42a-1079daad1e21","block_type":"box","text":"purchasers, such as the Funds, and may be neither listed on an exchange nor traded in other","page_number":174,"box":{"x":117,"y":800,"width":693,"height":12}},{"id":"554d9323-dd10-46d0-b4ed-c0195af77fb3","block_type":"box","text":"established markets. In many cases, privately placed securities may not be freely transferable under","page_number":174,"box":{"x":116,"y":816,"width":745,"height":12}},{"id":"87369572-d431-4cee-9065-d6322481be39","block_type":"box","text":"the laws of the applicable jurisdiction or due to contractual restrictions on resale. Some of these","page_number":174,"box":{"x":116,"y":831,"width":714,"height":12}},{"id":"9d832457-52a5-4b2e-ba6b-e8b042ffb827","block_type":"box","text":"securities are new and complex, and trade only among institutions; the markets for these securities are","page_number":174,"box":{"x":116,"y":847,"width":769,"height":12}},{"id":"80c6b0ff-3187-46f4-9acc-a77d555d0f68","block_type":"box","text":"still developing and may not function as efficiently as established markets. 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There can be","page_number":175,"box":{"x":117,"y":103,"width":376,"height":12}},{"id":"757a822e-c751-478e-abc2-15c4bddf63b7","block_type":"box","text":"no assurance that a Fund will be able to realize the","page_number":175,"box":{"x":494,"y":103,"width":375,"height":9}},{"id":"5036bf03-9b5d-4134-bf7f-33d78b0c92a9","block_type":"box","text":"value of such restricted securities in a timely manner","page_number":175,"box":{"x":116,"y":118,"width":382,"height":12}},{"id":"101e5540-68e7-404a-bf66-695d36109532","block_type":"box","text":"r or at all. As a result of the absence of a public","page_number":175,"box":{"x":498,"y":118,"width":342,"height":12}},{"id":"7f0c51a7-5ee4-4e63-9f9c-5127ad8eccf6","block_type":"box","text":"trading market and the potential bespoke nature on certa","page_number":175,"box":{"x":116,"y":134,"width":413,"height":12}},{"id":"6b915b93-d2f6-4c29-a0a3-933189ce913c","block_type":"box","text":"in transactions, restricted securities may be","page_number":175,"box":{"x":530,"y":134,"width":319,"height":12}},{"id":"e16f47b9-6a58-4148-9b88-64c206916abd","block_type":"box","text":"deemed to be illiquid investments or less liquid inve","page_number":175,"box":{"x":116,"y":149,"width":373,"height":12}},{"id":"0b6f91ae-5541-42ce-af65-d31b797b1ff9","block_type":"box","text":"stments and may be more difficult to value than","page_number":175,"box":{"x":490,"y":149,"width":349,"height":12}},{"id":"d2d7ac4b-92b4-483e-b677-c2bbc4969d28","block_type":"box","text":"publicly traded securities. To the extent that restrict","page_number":175,"box":{"x":117,"y":165,"width":369,"height":12}},{"id":"482925b7-e4c2-42e0-9e43-686047b64f2d","block_type":"box","text":"ed securities may be resold in privately negotiated","page_number":175,"box":{"x":487,"y":165,"width":369,"height":12}},{"id":"9caeb3bb-46a5-4651-9827-2380d204f62f","block_type":"box","text":"transactions, the prices realized from the sales, due to","page_number":175,"box":{"x":116,"y":180,"width":398,"height":12}},{"id":"e7805940-67fa-4ee3-8dc7-8d412e9cf69d","block_type":"box","text":"lack of liquidity, could be less than those originally","page_number":175,"box":{"x":515,"y":180,"width":366,"height":12}},{"id":"938f0932-a3f8-4312-863a-db4ca3ce8713","block_type":"box","text":"paid by the Fund or less than their fair market va","page_number":175,"box":{"x":117,"y":196,"width":351,"height":12}},{"id":"dea8cf5b-7c6b-4ebc-90d5-f7c30e0f81f0","block_type":"box","text":"lue. The amount of any discount may vary depending on","page_number":175,"box":{"x":470,"y":196,"width":414,"height":12}},{"id":"b768543b-8ccc-45f0-ab1a-6e81391efe33","block_type":"box","text":"the security type, the character of the issuer, whic","page_number":175,"box":{"x":116,"y":211,"width":361,"height":12}},{"id":"3cb7c7f9-03d3-446e-892d-e617aecb46af","block_type":"box","text":"h party (if any) will bear the expenses of registering the","page_number":175,"box":{"x":478,"y":211,"width":403,"height":12}},{"id":"b6e6a079-4ac1-4f4f-81a6-7f1ec7325ba8","block_type":"box","text":"restricted security, and prevailing market conditions. In","page_number":175,"box":{"x":117,"y":227,"width":394,"height":12}},{"id":"86687bbd-4d65-4cfe-b1a3-fde1fa461795","block_type":"box","text":"addition, issuers whose securities are not publicly","page_number":175,"box":{"x":512,"y":227,"width":369,"height":12}},{"id":"ce968291-fd2f-4411-9426-9715767b7760","block_type":"box","text":"traded or who are not otherwise publicly listed may not","page_number":175,"box":{"x":116,"y":242,"width":397,"height":12}},{"id":"e28043e8-7f09-40c7-b856-7cdd0aef48f5","block_type":"box","text":"t be subject to the disclosure and other investor","page_number":175,"box":{"x":512,"y":242,"width":345,"height":12}},{"id":"2833ba3e-c72c-4a63-99c8-838266efde43","block_type":"box","text":"protection requirements that may be","page_number":175,"box":{"x":117,"y":258,"width":267,"height":12}},{"id":"650bd4af-c1d8-43c9-b187-732d27b69e4f","block_type":"box","text":"applicable if their securities were publicly traded. If any privately","page_number":175,"box":{"x":385,"y":258,"width":467,"height":12}},{"id":"0cb4498d-ddf6-488e-9fc7-734e15adbe34","block_type":"box","text":"placed securities held by a Fund are required to be r","page_number":175,"box":{"x":117,"y":273,"width":379,"height":12}},{"id":"3ebb61f4-e836-4168-9885-be583d729e68","block_type":"box","text":"egistered under the securities laws of one or more","page_number":175,"box":{"x":497,"y":273,"width":369,"height":12}},{"id":"2c96d657-2a22-42f5-a648-4b302571a2f0","block_type":"box","text":"jurisdictions before being resold, the Fund may be requi","page_number":175,"box":{"x":115,"y":289,"width":405,"height":12}},{"id":"a1c2407e-2370-455c-b084-d1ae9be3ec8a","block_type":"box","text":"red to bear the expenses of registration. Where","page_number":175,"box":{"x":522,"y":289,"width":348,"height":12}},{"id":"a8fa1424-bc69-4a4e-bb74-c954a0225c16","block_type":"box","text":"registration is required for restricted securities, a","page_number":175,"box":{"x":117,"y":304,"width":354,"height":12}},{"id":"cb837063-d4fb-46da-b2f2-16876d4a0537","block_type":"box","text":"considerable time period may elapse between the time","page_number":175,"box":{"x":471,"y":304,"width":403,"height":12}},{"id":"b2f08fd9-c958-4ef7-aff1-bd193cfe667a","block_type":"box","text":"the Fund decides to sell the security and the time it is actually permitted to sell the security under an","page_number":175,"box":{"x":116,"y":320,"width":730,"height":12}},{"id":"704bbca8-43ea-4a52-812c-f229262f05b7","block_type":"box","text":"effective registration statement. If during such period,","page_number":175,"box":{"x":116,"y":335,"width":385,"height":12}},{"id":"c9c339ad-10ec-4ed6-9463-4491bd95f5bf","block_type":"box","text":"adverse market conditions were to develop, the","page_number":175,"box":{"x":502,"y":335,"width":355,"height":12}},{"id":"c54a6529-906a-446f-82c9-f4bdd08154a3","block_type":"box","text":"Fund might obtain less favorable pricing terms than when","page_number":175,"box":{"x":117,"y":351,"width":421,"height":12}},{"id":"c5ec74bb-eda5-4fe1-836f-890721506ac4","block_type":"box","text":"it decided to sell the security. In addition, the","page_number":175,"box":{"x":539,"y":351,"width":326,"height":12}},{"id":"f7dc5fef-29ac-4f8b-bea1-e7d46424edfb","block_type":"box","text":"Fund may be deemed to be an “underwriter” for purposes","page_number":175,"box":{"x":117,"y":366,"width":422,"height":12}},{"id":"4f981049-57fd-45d7-890c-82ecec8db667","block_type":"box","text":"of the Securities Act when selling restricted","page_number":175,"box":{"x":539,"y":366,"width":318,"height":12}},{"id":"3474a26a-54de-4faa-b8ae-e6b4dfe16a69","block_type":"box","text":"securities. If so, the Fund may be liable to purchasers","page_number":175,"box":{"x":116,"y":382,"width":394,"height":12}},{"id":"0cc218f8-010d-4633-9f73-d22d3a50ee99","block_type":"box","text":"of the restricted securities if the registration","page_number":175,"box":{"x":510,"y":382,"width":317,"height":12}},{"id":"bc90b2df-a138-43b0-a381-e67483094e49","block_type":"box","text":"statement prepared by the issuer, or the correspondi","page_number":175,"box":{"x":116,"y":397,"width":381,"height":12}},{"id":"f90ec4b8-5128-4a4b-b3a6-638f323a3ddc","block_type":"box","text":"ng prospectus, is materially inaccurate or","page_number":175,"box":{"x":499,"y":397,"width":303,"height":12}},{"id":"033f1b34-d2e8-4540-a53a-fce2bd901141","block_type":"box","text":"misleading. Transactions in restricted securities ma","page_number":175,"box":{"x":117,"y":413,"width":371,"height":12}},{"id":"f7687f2f-9f0f-4cde-afae-92b713af3c83","block_type":"box","text":"y entail other transaction co","page_number":175,"box":{"x":489,"y":413,"width":200,"height":12}},{"id":"e499f97f-15da-46ac-9137-1e55542ce540","block_type":"box","text":"sts that are higher than","page_number":175,"box":{"x":690,"y":413,"width":173,"height":12}},{"id":"35d74505-0c0d-45ee-bf2c-30868f601f34","block_type":"box","text":"those for transactions in unrestricted securities. Certa","page_number":175,"box":{"x":116,"y":428,"width":388,"height":10}},{"id":"3249f35e-37aa-4b4b-b544-4ae101671a0e","block_type":"box","text":"in of the Fund’s investments in private placements","page_number":175,"box":{"x":505,"y":428,"width":369,"height":12}},{"id":"5ac90314-0b62-4273-b577-16ac7d75effc","block_type":"box","text":"may consist of direct investments and may include in","page_number":175,"box":{"x":117,"y":444,"width":382,"height":12}},{"id":"81012453-7fe0-4cda-bb92-d3e250be8734","block_type":"box","text":"vestments in smaller, less seasoned issuers, which","page_number":175,"box":{"x":500,"y":444,"width":377,"height":11}},{"id":"3a6b9030-e945-43c7-b599-459e020267c0","block_type":"box","text":"may involve greater risks. Issuers of restrict","page_number":175,"box":{"x":117,"y":459,"width":315,"height":12}},{"id":"f0186d93-ceba-445a-8ac4-35502fcd3adc","block_type":"box","text":"ed securities may not be subject to SEC reporting","page_number":175,"box":{"x":433,"y":459,"width":365,"height":12}},{"id":"b64d88dd-3d7a-4de0-8b4b-1d336bbeb7e7","block_type":"box","text":"requirements, may not be required to maintain t","page_number":175,"box":{"x":117,"y":475,"width":345,"height":12}},{"id":"dc4d4227-a7f1-46f0-9bfa-8930d9f1ece3","block_type":"box","text":"heir accounting records in accordance with generally","page_number":175,"box":{"x":463,"y":475,"width":386,"height":12}},{"id":"17a13e8e-f3d1-43e4-ba2e-97af4a4fbf67","block_type":"box","text":"accepted accounting principles, and may not be required","page_number":175,"box":{"x":116,"y":490,"width":417,"height":12}},{"id":"8f065c27-8cb0-4c52-9840-4eb035e7ff19","block_type":"box","text":"to maintain effective internal controls over","page_number":175,"box":{"x":533,"y":490,"width":308,"height":10}},{"id":"628b0f30-d0b3-44ee-8630-310452bd625f","block_type":"box","text":"financial reporting. As a result, BlackRock may not","page_number":175,"box":{"x":116,"y":506,"width":366,"height":12}},{"id":"63760124-93bf-4fb1-a650-467a8f0d3cf1","block_type":"box","text":"t have timely or accurate information about the","page_number":175,"box":{"x":482,"y":506,"width":339,"height":12}},{"id":"a3c4160d-9709-4f00-a770-bfe82480bdf3","block_type":"box","text":"business, financial condition and results of operations of","page_number":175,"box":{"x":117,"y":521,"width":407,"height":12}},{"id":"33205b17-408b-4f25-b2b8-2444924b48fa","block_type":"box","text":"f such issuers, and investments in securities of","page_number":175,"box":{"x":523,"y":521,"width":340,"height":11}},{"id":"e67157a5-d764-4c4f-9162-43030ef89bb6","block_type":"box","text":"such issuers may involve a high degree of business and financial risk and may result in substantial losses","page_number":175,"box":{"x":116,"y":537,"width":771,"height":12}},{"id":"3c860dfc-f3ae-4377-9140-ec2cd6ab08e0","block_type":"box","text":"to the Fund. Such issuers may also have limited produc","page_number":175,"box":{"x":116,"y":552,"width":404,"height":12}},{"id":"d2b8389d-e618-4a1e-b020-89e7bbfe4ffb","block_type":"box","text":"t lines, markets or financial resources, or they","page_number":175,"box":{"x":520,"y":552,"width":336,"height":12}},{"id":"4decae2d-b7b2-4b5c-8979-9f346c757227","block_type":"box","text":"may be dependent on a limited management group.","page_number":175,"box":{"x":117,"y":568,"width":381,"height":12}},{"id":"3d815d45-fc27-42d1-9194-973177a178ad","block_type":"box","text":"Certain restricted securities may represent limited investment opportunities and each shareholder’s","page_number":175,"box":{"x":117,"y":599,"width":740,"height":12}},{"id":"3f6687f0-e283-48d4-9e29-f0c564a38b6c","block_type":"box","text":"proportionate investment exposure to such limited investment opportunities may be reduced","page_number":175,"box":{"x":117,"y":614,"width":687,"height":12}},{"id":"563a9048-6f1b-4f68-b690-d467f4164f31","block_type":"box","text":"proportionately as the Fund’s net assets grow from new or additional investments made in the Fund by","page_number":175,"box":{"x":117,"y":630,"width":766,"height":12}},{"id":"96cb0194-9778-413e-99b4-7fab774a6ba8","block_type":"box","text":"other shareholders. The issuer of a private placement may later register those shares for public sale in","page_number":175,"box":{"x":116,"y":645,"width":765,"height":12}},{"id":"6700620f-5894-4548-87cc-298cf5a74038","block_type":"box","text":"an IPO, but there is no guarantee that an IPO will ever be completed. Even after an IPO, there may be","page_number":175,"box":{"x":116,"y":661,"width":760,"height":12}},{"id":"6defb239-6203-42fc-8edf-0aaf500f893c","block_type":"box","text":"a limited trading market for securities of that issuer, including any direct investment by a Fund, or the","page_number":175,"box":{"x":116,"y":676,"width":747,"height":12}},{"id":"59eab2b3-31c0-4504-bd1a-6840461ebf87","block_type":"box","text":"Fund may be subject to contractual limitations on its ability to resell its existing securities following an","page_number":175,"box":{"x":117,"y":692,"width":748,"height":12}},{"id":"d89eae37-69ad-4056-ae7e-85f9c365402c","block_type":"box","text":"IPO. The inability of an applicable issuer of a restricted security to complete an IPO or offer other","page_number":175,"box":{"x":117,"y":707,"width":719,"height":12}},{"id":"66e46b67-f5ac-4343-a78b-40892755a550","block_type":"box","text":"liquidity opportunities to the Fund and other investors will extend the holding period of a Fund’s","page_number":175,"box":{"x":117,"y":723,"width":702,"height":12}},{"id":"2954d197-c167-40d1-808c-b2c065064fe2","block_type":"box","text":"investments, potentially indefinitely, and may adversely affect the value of the investments. In making","page_number":175,"box":{"x":117,"y":738,"width":750,"height":12}},{"id":"4be33bf6-c99d-49c9-931f-97a964cbb082","block_type":"box","text":"investments in such securities, a Fund may obtain access to material nonpublic information, which may","page_number":175,"box":{"x":117,"y":754,"width":765,"height":12}},{"id":"f1ff0288-9998-4f2c-9b60-a1993961550d","block_type":"box","text":"restrict the Fund’s ability to conduct portfolio transactions in such securities. The activity of identifying,","page_number":175,"box":{"x":117,"y":769,"width":753,"height":12}},{"id":"ab0af20f-f3e3-4b35-9552-3d3eab71f1a8","block_type":"box","text":"completing, and realizing upon attractive investments in restricted securities is highly competitive and","page_number":175,"box":{"x":116,"y":785,"width":750,"height":12}},{"id":"e17273cd-cc20-4b5c-8f8c-9a64598262cc","block_type":"box","text":"involves a high degree of uncertainty. A Fund will be competing for investments against other similarly","page_number":175,"box":{"x":117,"y":800,"width":756,"height":12}},{"id":"fe7b302b-8f17-4c29-b37c-9ca60a524431","block_type":"box","text":"situated investors. It is possible that competition for appropriate investment opportunities may increase,","page_number":175,"box":{"x":116,"y":816,"width":766,"height":12}},{"id":"e40400aa-d651-405a-8b68-c7909ec0a7ee","block_type":"box","text":"thus potentially reducing the number of investment opportunities available to a Fund and adversely","page_number":175,"box":{"x":116,"y":831,"width":738,"height":12}},{"id":"ea71b931-8c8b-4aa7-b57a-545766fd8d4e","block_type":"box","text":"affecting the terms upon which investments can be made. There is no assurance that investment","page_number":175,"box":{"x":116,"y":847,"width":724,"height":12}},{"id":"9bab8bed-3235-4ae1-a6aa-068d7b1a026d","block_type":"box","text":"opportunities for restricted securities will be available at any given time or at a level desired by a Fund,","page_number":175,"box":{"x":116,"y":862,"width":765,"height":12}},{"id":"e230a9e2-7fbf-45df-8589-d10a6ddf7ef8","block_type":"box","text":"especially as that Fund grows in size.","page_number":175,"box":{"x":116,"y":878,"width":283,"height":12}},{"id":"55fc6b05-2fca-400d-a2ce-0fb8647022fc","block_type":"box","text":"II-91","page_number":175,"box":{"x":484,"y":909,"width":29,"height":9}},{"id":"25ed8aec-1cd5-4e02-97bd-8ec400e015a9","block_type":"box","text":"NM0926U-5926888-175/257","page_number":175,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"ce552665-815b-41e1-b899-01250fb3b0ed","block_type":"box","text":"There may not be a readily available market value for a Fund’s restricted securities (in particular,","page_number":176,"box":{"x":116,"y":87,"width":722,"height":12}},{"id":"60bec2ae-089d-4d1a-9546-8dd3970984c4","block_type":"box","text":"restricted securities issued by private companies), and thus may be considered “illiquid.” Each Fund","page_number":176,"box":{"x":117,"y":102,"width":745,"height":13}},{"id":"6fc23b43-2171-4163-9391-f0ee17091623","block_type":"box","text":"values restricted securities in accordance with BlackRock’s valuation policies and procedures, which","page_number":176,"box":{"x":116,"y":118,"width":750,"height":12}},{"id":"562c0b22-52ff-48c1-acac-bdd1d8cfb176","block_type":"box","text":"are designed to value investments such that they accurately reflect fair value. Due to the inherent","page_number":176,"box":{"x":116,"y":134,"width":727,"height":12}},{"id":"a68dcd47-0376-4d40-91a6-a8c2c16c1f45","block_type":"box","text":"uncertainty and subjectivity of determining the fair value of investments that do not have a readily","page_number":176,"box":{"x":117,"y":149,"width":725,"height":12}},{"id":"937c6d58-22e3-4160-807a-f1ef03171236","block_type":"box","text":"available market value, the fair value of a Fund’s private investments may differ significantly from the","page_number":176,"box":{"x":116,"y":165,"width":752,"height":12}},{"id":"0f380432-f2b8-4725-a272-11f6f7e91c3a","block_type":"box","text":"values that would have been used had a readily available market value existed for such investments","page_number":176,"box":{"x":116,"y":180,"width":749,"height":12}},{"id":"f9dfa32a-c351-484b-b6f3-a7187ed23bb3","block_type":"box","text":"and may differ materially from the amounts the Fund may realize on any dispositions of such","page_number":176,"box":{"x":116,"y":196,"width":692,"height":12}},{"id":"c4a03753-6490-43f6-98e1-ad12fc153101","block_type":"box","text":"investments. Differences in the value of the Fund’s private investments could result in the Fund’s","page_number":176,"box":{"x":117,"y":211,"width":722,"height":12}},{"id":"c2cbba6b-3696-457d-8183-bc3e6a7a9767","block_type":"box","text":"shareholder transactions being effected at a NAV that does not accurately reflect the underlying value","page_number":176,"box":{"x":116,"y":227,"width":761,"height":12}},{"id":"279d6e5b-bd85-495b-8d85-deb6a39c1d4a","block_type":"box","text":"of the Fund’s portfolio, potentially resulting in the dilution of shareholder interests and increasing","page_number":176,"box":{"x":116,"y":242,"width":718,"height":12}},{"id":"797a85f5-04c2-46a3-97f6-6cfaa1417537","block_type":"box","text":"opportunities for shareholder arbitrage. The values used by the Fund to price its restricted securities","page_number":176,"box":{"x":116,"y":258,"width":747,"height":12}},{"id":"f84b52c3-36ab-4089-bb4b-af00413b3c2c","block_type":"box","text":"may also differ from those used by other investment companies and investors to price the same","page_number":176,"box":{"x":117,"y":273,"width":715,"height":12}},{"id":"542068a3-e30e-4e3e-9fba-ab96b7046211","block_type":"box","text":"restricted securities. In addition, the impact of changes in the market environment and other events on","page_number":176,"box":{"x":117,"y":289,"width":763,"height":12}},{"id":"cf306146-8579-4298-9aa7-d9847b934794","block_type":"box","text":"the fair values of a Fund’s investments that have no readily available market values may differ from the","page_number":176,"box":{"x":116,"y":304,"width":769,"height":12}},{"id":"88c1b93c-c41a-496c-ab96-c6cecff2ef4a","block_type":"box","text":"impact of such changes on the readily available market values for the Fund’s other investments. A","page_number":176,"box":{"x":117,"y":320,"width":732,"height":12}},{"id":"72ac2574-59e5-4877-9d22-0fb9f0010049","block_type":"box","text":"Fund’s NAV could be adversely affected if the Fund’s determinations regarding the fair value of the","page_number":176,"box":{"x":117,"y":335,"width":738,"height":12}},{"id":"267bb9f0-1f5f-4661-a711-9c88c02c6176","block_type":"box","text":"Fund’s investments were materially higher than the investment’s actual market or fair value or the","page_number":176,"box":{"x":117,"y":351,"width":728,"height":12}},{"id":"76863655-f046-4b65-b535-863458f5b988","block_type":"box","text":"values that the Fund ultimately realizes upon the disposal of such investments.","page_number":176,"box":{"x":116,"y":366,"width":590,"height":12}},{"id":"dd7fad9e-b45a-4ce5-a8be-1318a5e32beb","block_type":"box","text":"See also risks discussed under “Illiquid Investments.”","page_number":176,"box":{"x":116,"y":394,"width":400,"height":12}},{"id":"104d0c27-f64f-4daf-82e1-fc1e9b8208ab","block_type":"box","text":"Reverse Repurchase Agreements.","page_number":176,"box":{"x":116,"y":422,"width":271,"height":12}},{"id":"01a8fc44-f5e7-4cee-a8d1-c71d87eba84a","block_type":"box","text":"A Fund may enter into reverse repurchase agreements with the","page_number":176,"box":{"x":389,"y":422,"width":481,"height":12}},{"id":"35a45219-89eb-4231-91e4-79ec6453a030","block_type":"box","text":"same parties with whom it may enter into repurchase agreements. Under a reverse repurchase","page_number":176,"box":{"x":116,"y":438,"width":711,"height":11}},{"id":"19d479c4-1fbd-45b9-bf3c-e5d85c42302b","block_type":"box","text":"agreement, a Fund sells securities to another party and agrees to repurchase them at a particular date","page_number":176,"box":{"x":116,"y":453,"width":766,"height":12}},{"id":"774e5f92-f2a1-4bfb-be20-a84c1bc9b200","block_type":"box","text":"and price. A Fund may enter into a reverse repurchase agreement when it is anticipated that the","page_number":176,"box":{"x":116,"y":469,"width":719,"height":11}},{"id":"0be6bbea-b79d-466f-aec9-3c85c40c23c0","block_type":"box","text":"interest income to be earned from the investment of the proceeds of the transaction is greater than the","page_number":176,"box":{"x":117,"y":484,"width":765,"height":12}},{"id":"8cf92d84-7917-415c-a7ac-ac4a64f71eff","block_type":"box","text":"interest expense of the transaction.","page_number":176,"box":{"x":117,"y":499,"width":265,"height":12}},{"id":"87823605-665d-4cf0-8122-e3113d45a312","block_type":"box","text":"The use of reverse repurchase agreements may be regarded as leveraging and, therefore, speculative.","page_number":176,"box":{"x":116,"y":527,"width":772,"height":12}},{"id":"216912ff-0aab-408b-b326-97cb7d19285a","block_type":"box","text":"Furthermore, reverse repurchase agreements involve the risks that (i) the interest income earned in the","page_number":176,"box":{"x":117,"y":543,"width":771,"height":12}},{"id":"36cddf8f-1e04-4066-b076-1257a25f55f9","block_type":"box","text":"investment of the proceeds will be less than the interest expense, (ii) the market value of the securities","page_number":176,"box":{"x":117,"y":558,"width":765,"height":12}},{"id":"1d4dbf0c-c893-4129-9201-c296a2bea97e","block_type":"box","text":"retained in lieu of sale by a Fund may decline below","page_number":176,"box":{"x":117,"y":574,"width":390,"height":12}},{"id":"32babbb7-a8d9-4eb3-8096-b199da9f1c19","block_type":"box","text":"the price of the securities the Fund has sold but is","page_number":176,"box":{"x":507,"y":574,"width":375,"height":12}},{"id":"61fb6871-7461-419c-906f-699ba314b22d","block_type":"box","text":"obligated to repurchase, (iii) the market value of the securities sold will decline below the price at which","page_number":176,"box":{"x":116,"y":589,"width":770,"height":12}},{"id":"58936319-6408-4018-83f1-925353064b9f","block_type":"box","text":"the Fund is required to repurchase them and (iv) the securities will not be returned to the Fund.","page_number":176,"box":{"x":116,"y":605,"width":710,"height":12}},{"id":"33c43100-e287-4e58-b4e1-dedf976221d1","block_type":"box","text":"In addition, if the buyer of securities under a reverse repurchase agreement files for bankruptcy or","page_number":176,"box":{"x":117,"y":633,"width":731,"height":12}},{"id":"c5d69b8c-0abc-4c18-86cf-f894d4ed29fd","block_type":"box","text":"becomes insolvent, such buyer or its trustee or receiver may receive an extension of time to determine","page_number":176,"box":{"x":117,"y":648,"width":765,"height":12}},{"id":"63183fd8-af6b-4e9f-bff8-17ba6bc880dd","block_type":"box","text":"whether to enforce a Fund’s obligations to repurchase the securities and the Fund’s use of the","page_number":176,"box":{"x":116,"y":664,"width":699,"height":12}},{"id":"b976da4f-a9f3-4250-b675-120c74144c78","block_type":"box","text":"proceeds of the reverse repurchase agreement may effectively be restricted pending such decision.","page_number":176,"box":{"x":117,"y":679,"width":737,"height":12}},{"id":"26208939-aa92-436c-b3e8-b084162b013b","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into reverse repurchase","page_number":176,"box":{"x":117,"y":707,"width":705,"height":12}},{"id":"ff33b88d-d0e6-4acf-b67a-e14b6caab373","block_type":"box","text":"agreements and similar financing transactions (e.g., recourse and non-recourse tender option bonds,","page_number":176,"box":{"x":116,"y":723,"width":749,"height":12}},{"id":"8149977c-88a6-4aff-acc9-bd47727118b8","block_type":"box","text":"borrowed bonds) notwithstanding the limitation on the issuance of senior securities in Section 18 of the","page_number":176,"box":{"x":117,"y":738,"width":762,"height":12}},{"id":"25240c04-51c2-4c69-b947-7dcbe30860fb","block_type":"box","text":"Investment Company Act, provided that the Fund either (i) complies with the 300% asset coverage","page_number":176,"box":{"x":117,"y":754,"width":731,"height":12}},{"id":"42a67863-5e86-4be0-925e-6f6f92fef545","block_type":"box","text":"ratio with respect to all such transactions and any","page_number":176,"box":{"x":117,"y":769,"width":366,"height":12}},{"id":"5a2f30e0-b1a5-4f43-82f9-340a9f8737af","block_type":"box","text":"other borrowings in the aggregate, or (ii) treats all","page_number":176,"box":{"x":489,"y":769,"width":366,"height":12}},{"id":"bb575530-b754-46a3-a4ec-57f5b941a06a","block_type":"box","text":"such transactions as Derivatives Transactions under Rule 18f-4. See “— Derivatives — Regulation of","page_number":176,"box":{"x":116,"y":785,"width":752,"height":12}},{"id":"6b14d94b-62cc-4929-b75a-8a5fe9a63a67","block_type":"box","text":"Derivatives — Rule 18f-4 under the Investment Company Act” above. The SEC has also finalized rules","page_number":176,"box":{"x":117,"y":800,"width":762,"height":12}},{"id":"ccac94b8-460b-4fae-99b6-a23969a6b2a7","block_type":"box","text":"that will require certain transactions involving U.S. Treasuries, including reverse repurchase","page_number":176,"box":{"x":116,"y":816,"width":680,"height":12}},{"id":"2599a146-5530-4093-97bd-35f56262b4a1","block_type":"box","text":"agreements, to be centrally cleared. Compliance with these rules is expected to be required by the","page_number":176,"box":{"x":116,"y":831,"width":736,"height":12}},{"id":"5cd204d1-818c-4bdd-a82c-a7e3625ba7e2","block_type":"box","text":"middle of 2027. Although the impact of these rules on the Funds is difficult to predict, they may reduce","page_number":176,"box":{"x":117,"y":847,"width":762,"height":12}},{"id":"9b1ee49f-79d6-4fb8-8586-5d7a2eb4fbe1","block_type":"box","text":"the availability or increase the costs of such transactions and may adversely affect a Fund’s","page_number":176,"box":{"x":116,"y":862,"width":686,"height":12}},{"id":"5f1c0620-5276-4ae9-b266-d429892dcaf0","block_type":"box","text":"performance.","page_number":176,"box":{"x":117,"y":878,"width":103,"height":12}},{"id":"d366447b-f1f9-48f6-b7ab-0ad652cb0865","block_type":"box","text":"II-92","page_number":176,"box":{"x":484,"y":909,"width":31,"height":9}},{"id":"9bd1c7a1-7856-4fa0-a564-103f297bbbfe","block_type":"box","text":"NM0926U-5926888-176/257","page_number":176,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"c2632206-421f-44c6-8508-891fe593a72c","block_type":"box","text":"Additionally, regulations adopted by global prudential regulators require certain bank-regulated","page_number":177,"box":{"x":116,"y":87,"width":707,"height":12}},{"id":"063b4b75-cf50-4a82-b221-ae9674f395ea","block_type":"box","text":"counterparties and certain of their affiliates to include in certain financial contracts, including many","page_number":177,"box":{"x":116,"y":102,"width":732,"height":13}},{"id":"ea2e4a1d-930a-41d3-a429-507291c1ffbc","block_type":"box","text":"reverse repurchase agreements, terms that delay or restrict the rights of counterparties, such as a","page_number":177,"box":{"x":117,"y":118,"width":732,"height":12}},{"id":"44a82ee1-dede-4fd8-8570-31d623a64fed","block_type":"box","text":"Fund, to terminate such agreements, take foreclosure action, exercise other default rights or restrict","page_number":177,"box":{"x":117,"y":134,"width":744,"height":12}},{"id":"80a54b32-3e27-45c6-87ee-c3d7cf587acd","block_type":"box","text":"transfers of credit support in the event that the counterparty and/or its affiliates are subject to certain","page_number":177,"box":{"x":116,"y":149,"width":748,"height":12}},{"id":"df5ee64c-f555-4e82-ab4f-e57776df8d2f","block_type":"box","text":"types of resolution or insolvency proceedings. It is possible that these requirements, as well as","page_number":177,"box":{"x":116,"y":165,"width":707,"height":12}},{"id":"5074351e-151a-4d98-8a35-5deff72c85a7","block_type":"box","text":"potential additional government regulation and other developments in the market, could adversely","page_number":177,"box":{"x":117,"y":180,"width":729,"height":12}},{"id":"5a01d37d-f716-405f-a267-11222167ada8","block_type":"box","text":"affect a Fund’s ability to terminate existing reverse repurchase agreements or to realize amounts to be","page_number":177,"box":{"x":116,"y":196,"width":765,"height":12}},{"id":"cf093eac-c9ff-45ee-b610-e02a87ea0397","block_type":"box","text":"received under such agreements.","page_number":177,"box":{"x":117,"y":211,"width":253,"height":12}},{"id":"e6846561-dee3-42c9-a9c9-f334a4417c5f","block_type":"box","text":"Rights Offerings and Warrants to Purchase.","page_number":177,"box":{"x":116,"y":242,"width":349,"height":12}},{"id":"dbe38b9f-a927-4102-94a4-99ec6b184acb","block_type":"box","text":"Certain Funds may participate in rights offerings and","page_number":177,"box":{"x":466,"y":242,"width":399,"height":12}},{"id":"e4bc73df-d029-4c13-88d6-2b3921882ea4","block_type":"box","text":"may purchase warrants, which are privileges issued by corporations enabling the owners to subscribe","page_number":177,"box":{"x":117,"y":258,"width":759,"height":12}},{"id":"79d20955-61f9-446a-90b7-10553bb36045","block_type":"box","text":"to and purchase a specified number of shares of the corporation at a specified price during a specified","page_number":177,"box":{"x":116,"y":273,"width":763,"height":12}},{"id":"5fa794d9-476c-4e7c-b839-6c1af57b86ca","block_type":"box","text":"period of time. Subscription rights normally have a short life span to expiration. The purchase of rights","page_number":177,"box":{"x":117,"y":289,"width":759,"height":12}},{"id":"e53c86e8-1086-4830-a555-11bf53522b52","block_type":"box","text":"or warrants involves the risk that a Fund could lose the purchase value of a right or warrant if the right","page_number":177,"box":{"x":116,"y":304,"width":760,"height":12}},{"id":"1252edfe-7760-4776-a2fd-571583017903","block_type":"box","text":"to subscribe to additional shares is not exercised prior to the rights’ and warrants’ expiration. Also, the","page_number":177,"box":{"x":116,"y":320,"width":760,"height":12}},{"id":"a3b153cb-b218-47dc-b420-58fea809b310","block_type":"box","text":"purchase of rights and/or warrants involves the risk that the effective price paid for the right and/or","page_number":177,"box":{"x":117,"y":335,"width":732,"height":12}},{"id":"b5f0d9c1-7317-4a08-b244-4f13c4059489","block_type":"box","text":"warrant added to the subscription price of the related security may exceed the value of the subscribed","page_number":177,"box":{"x":116,"y":351,"width":762,"height":12}},{"id":"87980a92-e9d8-4948-9434-9887f420e55d","block_type":"box","text":"security’s market price such as when there is no movement in the level of the underlying security.","page_number":177,"box":{"x":116,"y":366,"width":728,"height":12}},{"id":"296e21ae-344f-454e-bf71-44dcfffb782c","block_type":"box","text":"Buying a warrant does not make the Fund a shareholder of the underlying stock. The warrant holder","page_number":177,"box":{"x":117,"y":382,"width":747,"height":12}},{"id":"b7598a40-9747-4b40-97d2-8628190b73a6","block_type":"box","text":"has no voting or dividend rights with respect to the underlying stock. A warrant does not carry any right","page_number":177,"box":{"x":117,"y":397,"width":766,"height":12}},{"id":"251d294a-d567-4315-9771-fcde072aa6fb","block_type":"box","text":"to assets of the issuer, and for this reason investments in warrants may be more speculative than other","page_number":177,"box":{"x":116,"y":413,"width":771,"height":12}},{"id":"8f4c6f26-c5cc-461e-ae36-b24ab5337a17","block_type":"box","text":"equity-based investments.","page_number":177,"box":{"x":116,"y":428,"width":200,"height":12}},{"id":"9347e8fc-62d2-4ec1-ad45-7572f6ac3e0f","block_type":"box","text":"Rule 144A Securities.","page_number":177,"box":{"x":116,"y":459,"width":170,"height":10}},{"id":"96edfd2b-34bf-4b93-b4fc-c0c3e00afc3a","block_type":"box","text":"A Fund may purchase securities that can be offered and sold only to “qualified","page_number":177,"box":{"x":287,"y":459,"width":590,"height":12}},{"id":"6d62eb36-5c44-4b32-81fb-7e313cc0bcd7","block_type":"box","text":"institutional buyers” pursuant to Rule 144A under the Securities Act. See “Restricted Securities” above.","page_number":177,"box":{"x":117,"y":475,"width":769,"height":12}},{"id":"85329a94-9cfa-476f-9d2f-a13f56d11f55","block_type":"box","text":"Securities Lending.","page_number":177,"box":{"x":117,"y":506,"width":153,"height":12}},{"id":"263c1b0b-4069-4ea0-8248-4f5747c350d0","block_type":"box","text":"Each Fund may lend portfolio securities to certain borrowers that BlackRock","page_number":177,"box":{"x":271,"y":506,"width":575,"height":12}},{"id":"718af2da-c3de-4960-b17e-6f5e35b17478","block_type":"box","text":"determines to be creditworthy, including borrowers affiliated with BlackRock. The borrowers provide","page_number":177,"box":{"x":116,"y":521,"width":744,"height":12}},{"id":"67eff292-531f-4e2b-8da5-90ac08473637","block_type":"box","text":"collateral that is maintained in an amount at least","page_number":177,"box":{"x":116,"y":537,"width":369,"height":9}},{"id":"17ed0f97-1512-4ccf-811f-fc945b87d491","block_type":"box","text":"equal to the current market value of the securities","page_number":177,"box":{"x":486,"y":537,"width":373,"height":12}},{"id":"37083f06-76f2-4048-94c5-a7ceb00b368a","block_type":"box","text":"loaned. No securities loan shall be made on behalf of a Fund if, as a result, the aggregate value of all","page_number":177,"box":{"x":117,"y":552,"width":755,"height":12}},{"id":"53cecf59-f5f5-4940-97c0-7debf9ea9558","block_type":"box","text":"securities loans of the particular Fund exceeds one-third of the value of such Fund’s total assets","page_number":177,"box":{"x":116,"y":568,"width":718,"height":12}},{"id":"1eb72b7f-7ca9-4de6-93ba-88197e20ca18","block_type":"box","text":"(including the value of the collateral received). A Fund may terminate a loan at any time and obtain the","page_number":177,"box":{"x":117,"y":583,"width":765,"height":12}},{"id":"a2f80c1e-a60f-438c-97fc-b2f469fc452b","block_type":"box","text":"return of the securities loaned. Each Fund receives, by way of substitute payment, the value of any","page_number":177,"box":{"x":117,"y":599,"width":738,"height":12}},{"id":"6e0d2bcb-0728-45f6-9fa6-1b64011c74a3","block_type":"box","text":"interest or cash or non-cash distributions paid on the loaned securities that it would have otherwise","page_number":177,"box":{"x":117,"y":614,"width":738,"height":12}},{"id":"c88b7049-b873-4d4e-af7d-ad92b6241766","block_type":"box","text":"received if the securities were not on loan.","page_number":177,"box":{"x":117,"y":630,"width":318,"height":9}},{"id":"f555f429-6ca0-493a-b00e-a561fbf43669","block_type":"box","text":"With respect to loans that are collateralized by cash, the borrower may be entitled to receive a fee","page_number":177,"box":{"x":116,"y":661,"width":726,"height":12}},{"id":"9ce9ca7f-55d9-44bd-a1c8-6a36562c6f39","block_type":"box","text":"based on the amount of cash collateral. The Funds are compensated by any positive difference","page_number":177,"box":{"x":117,"y":676,"width":707,"height":12}},{"id":"d757e531-4736-4cd2-aefd-ac358d84512c","block_type":"box","text":"between the amount earned on the reinvestment of cash collateral and the fee paid to the borrower. In","page_number":177,"box":{"x":117,"y":692,"width":758,"height":12}},{"id":"f71a5701-81e4-44a4-8e50-dbf1b5d065bf","block_type":"box","text":"the case of collateral other than cash, a Fund is compensated by a fee paid by the borrower equal to a","page_number":177,"box":{"x":116,"y":707,"width":760,"height":12}},{"id":"62224a95-4983-4964-88e0-0e885de370fa","block_type":"box","text":"percentage of the market value of the loaned securities. Any cash collateral received by the Fund for","page_number":177,"box":{"x":117,"y":723,"width":746,"height":12}},{"id":"ca7d199b-dbd2-458b-8425-02df83860f78","block_type":"box","text":"such loans, and uninvested cash, may be reinvested in certain short-term instruments either directly on","page_number":177,"box":{"x":116,"y":738,"width":764,"height":12}},{"id":"a77e928a-4015-4bb1-ac11-85c2730daf0f","block_type":"box","text":"behalf of the Fund or through one or more joint accounts or money market funds, including those","page_number":177,"box":{"x":117,"y":754,"width":717,"height":12}},{"id":"e0a8ca50-ac1c-4712-ae74-9c5941331588","block_type":"box","text":"affiliated with BlackRock; such investments are subject to investment risk.","page_number":177,"box":{"x":116,"y":769,"width":546,"height":12}},{"id":"7f7766c5-b7af-4338-9036-66514e33ac47","block_type":"box","text":"Securities lending involves exposure to certain risks, including operational risk (","page_number":177,"box":{"x":116,"y":800,"width":589,"height":12}},{"id":"1cf5f7f1-5500-4dff-a9a6-89372d44df76","block_type":"box","text":"i.e.","page_number":177,"box":{"x":706,"y":800,"width":21,"height":10}},{"id":"dff1059f-9988-4c28-90eb-fb97aea90714","block_type":"box","text":", the risk of losses","page_number":177,"box":{"x":730,"y":800,"width":132,"height":11}},{"id":"cbd044bf-21d9-4ff7-9062-eb21f36853ae","block_type":"box","text":"resulting from problems in the settlement and accounting process), “gap” risk (","page_number":177,"box":{"x":117,"y":816,"width":580,"height":12}},{"id":"7b0711b3-9350-4283-a33d-6e006974d810","block_type":"box","text":"i.e.","page_number":177,"box":{"x":698,"y":816,"width":21,"height":9}},{"id":"f38a5e16-080f-45f6-bec2-d81063080554","block_type":"box","text":", the risk of a","page_number":177,"box":{"x":722,"y":816,"width":94,"height":11}},{"id":"cef2638a-7cc8-4819-b49b-ef134c5adf69","block_type":"box","text":"mismatch between the return on cash collateral reinvestments and the fees each Fund has agreed to","page_number":177,"box":{"x":117,"y":831,"width":755,"height":12}},{"id":"994af2b8-3fa4-42e7-8f82-001c3f20f1f8","block_type":"box","text":"pay a borrower), foreign exchange risk (","page_number":177,"box":{"x":117,"y":847,"width":296,"height":12}},{"id":"6cfa4ca2-1116-4ab4-89ed-ebcbd3f5d51c","block_type":"box","text":"i.e.","page_number":177,"box":{"x":414,"y":847,"width":20,"height":9}},{"id":"e1bc5be1-3054-4271-9f04-ec0dc100ec31","block_type":"box","text":", the risk of a shortfall at default when a cash collateral","page_number":177,"box":{"x":437,"y":847,"width":409,"height":11}},{"id":"6a45423c-ee99-424b-a1d4-3e69deac19ca","block_type":"box","text":"investment is denominated in a currency other than the currency of the assets being loaned due to","page_number":177,"box":{"x":117,"y":862,"width":735,"height":12}},{"id":"db371a27-a041-47c3-ad41-caa7b8472f61","block_type":"box","text":"movements in foreign exchange rates), and credit, legal, counterparty and market risks (including the","page_number":177,"box":{"x":117,"y":878,"width":754,"height":12}},{"id":"f06fae45-3800-4abf-8190-ec39703dcaf7","block_type":"box","text":"II-93","page_number":177,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"cc932eec-002d-4c67-963f-f45a8b59adba","block_type":"box","text":"NM0926U-5926888-177/257","page_number":177,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"b9cabe8a-80b8-4970-aeb6-e6b4fdc21756","block_type":"box","text":"risk that market events, including but not limited to corporate actions, could lead a Fund to lend","page_number":178,"box":{"x":117,"y":87,"width":709,"height":12}},{"id":"31103335-5561-4a68-b783-80a212cbf48a","block_type":"box","text":"securities that are trading at a premium due to increased demand, or to recall loaned securities or to","page_number":178,"box":{"x":116,"y":103,"width":748,"height":12}},{"id":"d3266a11-59f9-4d35-b14a-9e52cb3d926f","block_type":"box","text":"lend less or not at all, which could lead to reduced securities lending revenue). If a Fund were to lend","page_number":178,"box":{"x":117,"y":118,"width":754,"height":12}},{"id":"efeab5e7-bf60-497a-bfc0-323e951b389f","block_type":"box","text":"out securities that are subject to a corporate action and commit to the borrower a particular election as","page_number":178,"box":{"x":116,"y":134,"width":764,"height":12}},{"id":"471c9133-5aaa-4d18-b237-7994b51623c5","block_type":"box","text":"determined by the Fund’s investment adviser, the benefit the Fund would receive in respect of","page_number":178,"box":{"x":116,"y":149,"width":702,"height":12}},{"id":"4629f571-3f77-40a1-a4ed-7e2d9bd80d68","block_type":"box","text":"committing to such election may or may not be less than the benefit the Fund would have received","page_number":178,"box":{"x":116,"y":165,"width":736,"height":12}},{"id":"6cea4b2b-f47a-4736-a964-83e058028655","block_type":"box","text":"from making a different election in such corporate action. If a securities lending counterparty were to","page_number":178,"box":{"x":116,"y":180,"width":748,"height":12}},{"id":"d2a3b453-2483-4123-bbb0-cb818a0b3196","block_type":"box","text":"default, a Fund would be subject to the risk of a possible delay in receiving collateral or in recovering","page_number":178,"box":{"x":116,"y":196,"width":751,"height":12}},{"id":"7c0b5807-6c8a-45d5-9e4e-53628365d883","block_type":"box","text":"the loaned securities, or to a possible loss of rights in the collateral. In the event a borrower does not","page_number":178,"box":{"x":116,"y":211,"width":751,"height":12}},{"id":"4d411eaf-3695-451d-9c9a-637b6f34c91e","block_type":"box","text":"return a Fund’s securities as agreed, the Fund’s ability to participate in a corporate action event may","page_number":178,"box":{"x":117,"y":227,"width":748,"height":12}},{"id":"b1edf5f2-bf74-4084-9ab4-6da59db2ec66","block_type":"box","text":"be impacted, or the Fund may experience losses if the proceeds received from liquidating the collateral","page_number":178,"box":{"x":117,"y":242,"width":769,"height":12}},{"id":"7086fd07-295a-4329-baf7-fbc437dae07e","block_type":"box","text":"do not at least equal the value of the loaned security at the time the collateral is liquidated, plus the","page_number":178,"box":{"x":116,"y":258,"width":739,"height":12}},{"id":"882e12be-e1f5-4eb4-aa1d-324dd3e59807","block_type":"box","text":"transaction costs incurred in purchasing replacement securities. This latter event could trigger adverse","page_number":178,"box":{"x":116,"y":273,"width":765,"height":12}},{"id":"ef0cb037-e62e-4459-931d-5adb9d4f7ca6","block_type":"box","text":"tax consequences for a Fund. A Fund could lose money if its short-term investment of the collateral","page_number":178,"box":{"x":116,"y":289,"width":742,"height":12}},{"id":"83408183-4e09-4e28-9967-d2028194300f","block_type":"box","text":"declines in value over the period of the loan. Substitute payments received by a Fund representing","page_number":178,"box":{"x":116,"y":304,"width":737,"height":12}},{"id":"a5d2ef89-8d74-46bd-ae00-f9be09f08217","block_type":"box","text":"dividends paid on securities loaned out by the Fund will not be considered qualified dividend income,","page_number":178,"box":{"x":116,"y":320,"width":752,"height":12}},{"id":"e98c7a98-a151-4899-91f2-58d52fa7a4f5","block_type":"box","text":"and distributions by the Fund of such substitute payments will not constitute qualified dividend income.","page_number":178,"box":{"x":116,"y":335,"width":765,"height":12}},{"id":"878d2fcf-2873-4553-9401-0a61fa72f6d3","block_type":"box","text":"Additionally, substitute payments received by a Fund representing qualified REIT dividends paid on","page_number":178,"box":{"x":116,"y":351,"width":741,"height":12}},{"id":"46ae41a7-5830-40e0-95a2-b22b560ab6f9","block_type":"box","text":"REIT securities loaned out by the Fund will not be considered qualified REIT dividends, and","page_number":178,"box":{"x":117,"y":366,"width":684,"height":12}},{"id":"d983ff27-7d07-4979-976f-68b9e3ea321c","block_type":"box","text":"distributions by the Fund of such substitute payments will not be eligible for a 20% deduction currently","page_number":178,"box":{"x":116,"y":382,"width":761,"height":12}},{"id":"6a104988-1dee-478c-8a7d-d36c74337ee9","block_type":"box","text":"available for ordinary REIT dividends paid to non-corporate shareholders provided certain other","page_number":178,"box":{"x":116,"y":397,"width":713,"height":12}},{"id":"a1c6e3cb-a250-4a22-8942-947b9b5f3866","block_type":"box","text":"requirements are satisfied. The securities lending agent will take into account the tax effects on","page_number":178,"box":{"x":117,"y":413,"width":710,"height":12}},{"id":"9ccf561b-ba35-4ee6-a787-ab93089a4be8","block_type":"box","text":"shareholders caused by these differences in connection with a Fund’s securities lending program.","page_number":178,"box":{"x":116,"y":428,"width":730,"height":12}},{"id":"5db8347e-fdc2-41ec-8e15-01e23e508816","block_type":"box","text":"Substitute payments received on tax-exempt securities loaned out will not be tax-exempt income.","page_number":178,"box":{"x":116,"y":444,"width":727,"height":12}},{"id":"4dd3f745-872b-4c54-ab81-b7387ebea4f7","block_type":"box","text":"There could also be changes in the status of issuers under applicable laws and regulations, including","page_number":178,"box":{"x":116,"y":459,"width":755,"height":12}},{"id":"b70b6857-1f8e-4c4b-a2c6-a879619bf731","block_type":"box","text":"tax regulations, that may impact the regulatory or tax treatment of loaned securities and could, for","page_number":178,"box":{"x":116,"y":475,"width":729,"height":12}},{"id":"b2baf54f-80cc-4d33-8c37-3f61a1a4b29a","block_type":"box","text":"example, result in a delay in the payment of dividend equivalent payments owed to a Fund (as","page_number":178,"box":{"x":116,"y":490,"width":704,"height":12}},{"id":"79a7da83-427d-4476-9fb5-419d766d53fa","block_type":"box","text":"permitted by applicable law).","page_number":178,"box":{"x":117,"y":506,"width":217,"height":12}},{"id":"a66eda1f-761d-4960-a915-e5c27e4283f2","block_type":"box","text":"Regulations adopted by global prudential regulators require certain bank-regulated counterparties and","page_number":178,"box":{"x":117,"y":537,"width":761,"height":12}},{"id":"b4c128b1-b83a-48d1-99b4-e0aad7d2330e","block_type":"box","text":"certain of their affiliates to include in certain financial contracts, including many securities lending","page_number":178,"box":{"x":116,"y":552,"width":723,"height":12}},{"id":"3b381f64-fee1-4415-81a9-e4569f24a421","block_type":"box","text":"agreements, terms that delay or restrict the rights of counterparties, such as the Fund, to terminate","page_number":178,"box":{"x":116,"y":568,"width":739,"height":12}},{"id":"296b2731-1be7-4bd7-8aaf-4cbf1e33e50a","block_type":"box","text":"such agreements, foreclose upon collateral, exercise other default rights or restrict transfers of credit","page_number":178,"box":{"x":116,"y":583,"width":751,"height":12}},{"id":"9f70a23c-939e-40e3-b8d3-3fb184716acb","block_type":"box","text":"support in the event that the counterparty and/or its affiliates are subject to certain types of resolution","page_number":178,"box":{"x":116,"y":599,"width":754,"height":12}},{"id":"73e4a353-6c4c-4857-8f6f-d18827668d02","block_type":"box","text":"or insolvency proceedings. It is possible that these requirements, as well as potential additional","page_number":178,"box":{"x":116,"y":614,"width":711,"height":12}},{"id":"6f27fb1c-e036-4231-8db8-bad85cec6626","block_type":"box","text":"government regulation and other developments in the market, could adversely affect the Fund’s ability","page_number":178,"box":{"x":116,"y":630,"width":762,"height":12}},{"id":"3e164a99-8a0b-498c-8a84-4250d7d6cb61","block_type":"box","text":"to terminate existing securities lending agreements or to realize amounts to be received under such","page_number":178,"box":{"x":116,"y":645,"width":744,"height":12}},{"id":"9ba309ba-4da8-481b-914a-68b70c70d60b","block_type":"box","text":"agreements. Prudential regulation may also favor lenders that can provide additional protections, such","page_number":178,"box":{"x":116,"y":661,"width":758,"height":12}},{"id":"a00d2b73-eec0-49e7-830b-6155b12c270a","block_type":"box","text":"as liens that are exercisable upon lender default, to bank borrowers. Certain Funds expect to provide","page_number":178,"box":{"x":116,"y":676,"width":749,"height":12}},{"id":"a6e2313f-b16a-4176-ae58-1592efc09a28","block_type":"box","text":"additional protections to bank borrowers, where permitted pursuant to a Fund’s investment policies and","page_number":178,"box":{"x":116,"y":692,"width":765,"height":12}},{"id":"4f13c26c-bae0-4f50-8f9b-f39f0e8963e1","block_type":"box","text":"if BlackRock believes doing so is in the best interest of the Fund.","page_number":178,"box":{"x":117,"y":707,"width":478,"height":12}},{"id":"eb99c8e0-b5eb-4311-8a9e-4b59322110bd","block_type":"box","text":"The SEC has adopted a rule that will require reporting and public disclosure of securities loan","page_number":178,"box":{"x":116,"y":738,"width":693,"height":12}},{"id":"67a0ae6b-2338-4a39-b621-40167ee176fd","block_type":"box","text":"transaction","page_number":178,"box":{"x":116,"y":754,"width":81,"height":9}},{"id":"a5ab9a77-dd91-4adc-8fac-85805ebeba06","block_type":"box","text":"information (not including party names); this may include, but is not limited to, information","page_number":178,"box":{"x":204,"y":754,"width":661,"height":12}},{"id":"bff24a81-0d29-4910-85b3-e0eba01bdcb0","block_type":"box","text":"about securities","page_number":178,"box":{"x":116,"y":769,"width":117,"height":10}},{"id":"4d3ddd71-5c51-4785-80e8-ddbd253cdf41","block_type":"box","text":"loans entered into in connection with short sales. Compliance with this rule is expected","page_number":178,"box":{"x":239,"y":769,"width":643,"height":12}},{"id":"fddfbcb9-f9b4-4ad6-b09e-01138ecfde37","block_type":"box","text":"to be required in late 2028, although in response to the outcome of a legal challenge against the rule,","page_number":178,"box":{"x":116,"y":785,"width":750,"height":12}},{"id":"c725aa31-f7a6-4b06-b74d-9badc0bea18f","block_type":"box","text":"the SEC may amend the rule and/or delay the current expected compliance date.","page_number":178,"box":{"x":116,"y":800,"width":602,"height":12}},{"id":"9964e310-9981-481e-9b6f-4c45931bf78e","block_type":"box","text":"Short Sales.","page_number":178,"box":{"x":117,"y":831,"width":95,"height":10}},{"id":"5aeb7896-cd2a-4a3b-ae22-7b1f8cd776b7","block_type":"box","text":"Certain Funds may make short sales of securities, either as a hedge against potential","page_number":178,"box":{"x":213,"y":831,"width":645,"height":12}},{"id":"f53cb696-bfcc-483e-ab35-ae142100e26d","block_type":"box","text":"declines in value of a portfolio security or to realize appreciation when a security that the Fund does","page_number":178,"box":{"x":116,"y":847,"width":744,"height":12}},{"id":"74a6e50b-965e-4b6c-9169-42686727d9f2","block_type":"box","text":"not own declines in value. Certain Funds have a fundamental investment restriction prohibiting short","page_number":178,"box":{"x":117,"y":862,"width":747,"height":12}},{"id":"0b67a6db-1feb-4810-85dd-3d63651fb9c7","block_type":"box","text":"sales of securities unless they are “against-the-box.” In a short sale “against-the-box,” at the time of the","page_number":178,"box":{"x":116,"y":878,"width":771,"height":12}},{"id":"de2d8e36-42c4-4457-8978-f730849dc980","block_type":"box","text":"II-94","page_number":178,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"22fe3a9c-6414-4e94-b4cf-ac56c6a85e66","block_type":"box","text":"NM0926U-5926888-178/257","page_number":178,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"9ac35601-23a9-406b-848e-eda5e11cb38e","block_type":"box","text":"sale, the Fund owns or has the immediate and unconditional right to acquire the identical security at no","page_number":179,"box":{"x":116,"y":87,"width":769,"height":12}},{"id":"4f4f9338-9263-49fe-ac0c-24160e971726","block_type":"box","text":"additional cost. When a Fund makes a short sale, it borrows the security sold short and delivers it to","page_number":179,"box":{"x":116,"y":103,"width":746,"height":12}},{"id":"36e48925-53a5-4e7c-abe8-d03edf1a0b2a","block_type":"box","text":"the broker-dealer through which it made the short sale. A Fund may have to pay a fee to borrow","page_number":179,"box":{"x":116,"y":118,"width":717,"height":12}},{"id":"76ffb3c0-13db-4e01-a8a6-54ac8f1afd8d","block_type":"box","text":"particular securities and is often obligated to turn over any payments received on such borrowed","page_number":179,"box":{"x":117,"y":134,"width":719,"height":12}},{"id":"75b810de-4c54-459b-93cd-e060b5087814","block_type":"box","text":"securities to the lender of the securities.","page_number":179,"box":{"x":116,"y":149,"width":301,"height":10}},{"id":"f3f0fc2c-e4f3-4716-8522-07526b296da4","block_type":"box","text":"A Fund secures its obligation to replace the borrowed security by depositing collateral with the broker","page_number":179,"box":{"x":116,"y":180,"width":756,"height":12}},{"id":"53a15bb4-6295-4d66-b171-46de6a2e2e10","block_type":"box","text":"dealer, usually in cash, U.S. Government Securities or other liquid securities similar to those borrowed.","page_number":179,"box":{"x":116,"y":196,"width":769,"height":12}},{"id":"57b66640-c29b-449d-8903-4f81c4ed5c62","block_type":"box","text":"With respect to uncovered short positions, a Fund is required to deposit similar collateral with its","page_number":179,"box":{"x":116,"y":211,"width":717,"height":12}},{"id":"533ce727-4093-44fa-bbeb-424a2f2b2251","block_type":"box","text":"custodian, if necessary, to the extent that the value of both collateral deposits in the aggregate is at all","page_number":179,"box":{"x":116,"y":227,"width":763,"height":12}},{"id":"ed5b779a-5d1b-482a-9e8a-2f9233ca5a40","block_type":"box","text":"times equal to at least 100% of the current market value of the security sold short. Depending on","page_number":179,"box":{"x":116,"y":242,"width":722,"height":12}},{"id":"f5a6c918-93da-418c-b79e-cd81ce2567a8","block_type":"box","text":"arrangements made with the broker-dealer from which the Fund borrowed the security, regarding","page_number":179,"box":{"x":116,"y":258,"width":726,"height":12}},{"id":"00309c01-50df-46c2-b246-fead1e34e3b3","block_type":"box","text":"payment received by the Fund on such security, a Fund may not receive any payments (including","page_number":179,"box":{"x":117,"y":273,"width":728,"height":12}},{"id":"3a7b11c0-8a07-43e1-a57c-5c9477b8328d","block_type":"box","text":"interest) on its collateral deposited with such broker-dealer.","page_number":179,"box":{"x":117,"y":289,"width":443,"height":12}},{"id":"dd1313d2-8e24-4927-b0aa-c9dd1f78114b","block_type":"box","text":"Because making short sales in securities that it does not own exposes a Fund to the risks associated","page_number":179,"box":{"x":117,"y":320,"width":754,"height":12}},{"id":"843c3c85-bcdd-4582-a01a-35174d293a48","block_type":"box","text":"with those securities, such short sales involve speculative exposure risk. A Fund will incur a loss as a","page_number":179,"box":{"x":116,"y":335,"width":755,"height":12}},{"id":"f8add363-f4bf-4a99-8731-ad393512e4d0","block_type":"box","text":"result of a short sale if the price of the security increases between the date of the short sale and the","page_number":179,"box":{"x":117,"y":351,"width":743,"height":12}},{"id":"7ea56ac4-adfd-495b-9f8c-55a90995f293","block_type":"box","text":"date on which the Fund replaces the borrowed security. As a result, if a Fund makes short sales in","page_number":179,"box":{"x":116,"y":366,"width":735,"height":12}},{"id":"e63f5bea-9f9d-45ed-8bef-79a8d09d9960","block_type":"box","text":"securities that increase in value, it will likely underperform similar mutual funds that do not make short","page_number":179,"box":{"x":116,"y":382,"width":759,"height":12}},{"id":"af249dfd-7538-458b-ad65-6d808a651471","block_type":"box","text":"sales in securities. A Fund will realize a gain on a short sale if the security declines in price between","page_number":179,"box":{"x":116,"y":397,"width":746,"height":12}},{"id":"9600672a-5b54-4495-a74a-e228f4b8a21e","block_type":"box","text":"those dates. There can be no assurance that a Fund will be able to close out a short sale position at","page_number":179,"box":{"x":116,"y":413,"width":747,"height":12}},{"id":"415f0646-be86-429d-8efa-5f2c039afe3e","block_type":"box","text":"any particular time or at an acceptable price. Although a Fund’s gain is limited to the price at which it","page_number":179,"box":{"x":116,"y":428,"width":750,"height":12}},{"id":"198b3b32-4cfd-497d-a81f-a3e8c10646d5","block_type":"box","text":"sold the security short, its potential loss is limited only by the maximum attainable price of the security,","page_number":179,"box":{"x":116,"y":444,"width":764,"height":12}},{"id":"8ccd81d1-ac42-468f-ae03-ec71d3acf169","block_type":"box","text":"less the price at which the security was sold and may, theoretically, be unlimited.","page_number":179,"box":{"x":117,"y":459,"width":603,"height":12}},{"id":"3f525e85-fa30-4799-8f79-ffd5dec67841","block_type":"box","text":"A Fund may also make short sales “against the box” without being subject to such limitations.","page_number":179,"box":{"x":116,"y":490,"width":698,"height":12}},{"id":"b8edb08b-5124-41d0-ac5e-8876eb690185","block_type":"box","text":"A Fund must comply with Rule 18f-4 under the Investment Company Act with respect to its short sale","page_number":179,"box":{"x":116,"y":521,"width":756,"height":12}},{"id":"1ccd34ac-b1fb-49af-9c44-6ffd5e074e0e","block_type":"box","text":"borrowings, which are considered Derivatives Transactions under the Rule. See “— Derivatives —","page_number":179,"box":{"x":117,"y":537,"width":734,"height":12}},{"id":"a6ea9d6a-ce13-4001-91ed-e0e78a386e6d","block_type":"box","text":"Regulation of Derivatives — Rule 18f-4 under the Investment Company Act” above.","page_number":179,"box":{"x":117,"y":552,"width":624,"height":12}},{"id":"8cc6c0aa-8eae-4210-a844-e49cb0078d2a","block_type":"box","text":"Short sales are also subject to certain SEC regulations and certain European Union and United","page_number":179,"box":{"x":116,"y":583,"width":712,"height":12}},{"id":"22adbfb7-e0b2-444d-96b1-c8a1286b9b99","block_type":"box","text":"Kingdom regulations (under which there are restrictions on net short sales in certain securities). If the","page_number":179,"box":{"x":117,"y":599,"width":755,"height":12}},{"id":"9048ce31-a459-44eb-a2d9-f672deec481b","block_type":"box","text":"SEC or regulatory authorities in other jurisdictions were to adopt additional restrictions regarding short","page_number":179,"box":{"x":116,"y":614,"width":761,"height":12}},{"id":"78344ecc-818e-4194-be23-35a40ef1416c","block_type":"box","text":"sales, they could restrict a Fund’s ability to engage in short sales in certain circumstances, and the","page_number":179,"box":{"x":116,"y":630,"width":736,"height":12}},{"id":"886b1f4c-e0b0-430e-878e-5cde20da48ca","block_type":"box","text":"Fund may be unable to execute its investment strategy as a result. In response to market events, the","page_number":179,"box":{"x":117,"y":645,"width":753,"height":12}},{"id":"307b100b-b870-4aee-9795-c40210410adb","block_type":"box","text":"SEC and regulatory authorities in other jurisdictions may adopt (and in certain cases, have adopted)","page_number":179,"box":{"x":116,"y":661,"width":742,"height":12}},{"id":"8d5bd581-b149-4fe0-b20a-ece40d1dc2bb","block_type":"box","text":"bans or other restrictions on short sales of certain securities or on derivatives and other hedging","page_number":179,"box":{"x":117,"y":676,"width":711,"height":12}},{"id":"588bf860-8cb6-4211-81bf-c521d0f29cb1","block_type":"box","text":"instruments used to achieve a similar economic effect. Such bans or other restrictions may make it","page_number":179,"box":{"x":117,"y":692,"width":731,"height":12}},{"id":"60fc2251-8708-4f11-a22a-b61a9505f7d0","block_type":"box","text":"impossible for a Fund to execute certain investment strategies and may have a material adverse effect","page_number":179,"box":{"x":117,"y":707,"width":760,"height":12}},{"id":"8cbe27c7-9f9d-47b9-bc81-c140a0695f60","block_type":"box","text":"on the Fund’s ability to generate returns.","page_number":179,"box":{"x":116,"y":723,"width":299,"height":12}},{"id":"7902e3c2-a18e-4a31-ab23-b61a49dfde2c","block_type":"box","text":"Special Purpose Acquisition Companies.","page_number":179,"box":{"x":117,"y":754,"width":325,"height":12}},{"id":"79fd8a5a-2e90-48fb-85eb-dd7f880aa0d5","block_type":"box","text":"A Fund may invest in stock, warrants, rights and other","page_number":179,"box":{"x":448,"y":754,"width":402,"height":12}},{"id":"f76747d6-6f7c-403e-aab0-348f3dd2b95b","block_type":"box","text":"interests issued by special purpose acquisition companies (“SPACs”) or similar special purpose entities","page_number":179,"box":{"x":117,"y":769,"width":765,"height":12}},{"id":"c12bb453-8457-40d4-9b5f-f0f7f2bf714f","block_type":"box","text":"that pool funds to seek potential acquisition opportunities, including the “founder’s” shares and","page_number":179,"box":{"x":116,"y":785,"width":698,"height":12}},{"id":"924edef8-3204-4fc0-8e5f-3c8f547c22a7","block_type":"box","text":"warrants described below. A SPAC is a publicly traded company that raises investment capital via an","page_number":179,"box":{"x":116,"y":800,"width":749,"height":12}},{"id":"4a132e02-29bb-4a62-9d49-aa92ef3dc450","block_type":"box","text":"IPO for the purpose of identifying and acquiring one or more operating businesses or assets. In","page_number":179,"box":{"x":117,"y":816,"width":705,"height":12}},{"id":"f00df5ed-ef7b-4dae-b600-b28925797fed","block_type":"box","text":"connection with forming a SPAC, the SPAC’s sponsors acquire “founder’s” shares, generally for","page_number":179,"box":{"x":116,"y":831,"width":716,"height":12}},{"id":"2c81b67a-1921-4e5d-a249-c857d4f05db3","block_type":"box","text":"nominal consideration, and warrants that will result in the sponsors owning a specified percentage","page_number":179,"box":{"x":117,"y":847,"width":731,"height":12}},{"id":"57b3800c-a360-4dd4-9311-7c800d1b8216","block_type":"box","text":"(typically 20%) of the SPAC’s outstanding common stock upon completion of the IPO. At the time a","page_number":179,"box":{"x":117,"y":862,"width":740,"height":12}},{"id":"87ab671d-6b92-4419-b028-cca98e081c74","block_type":"box","text":"SPAC conducts an IPO, it has selected a management team but has not yet identified a specific","page_number":179,"box":{"x":116,"y":878,"width":718,"height":12}},{"id":"5f97f82e-8f6f-4fbb-947b-8f4437b51538","block_type":"box","text":"II-95","page_number":179,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"f368695f-b927-4ffd-8b50-727895b60bd7","block_type":"box","text":"NM0926U-5926888-179/257","page_number":179,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"38200609-bb13-4328-8602-48ec7759314f","block_type":"box","text":"acquisition opportunity. Unless and until an acquisition is completed, a SPAC generally invests its","page_number":180,"box":{"x":116,"y":87,"width":728,"height":12}},{"id":"53824653-a0d2-4c56-8521-6499fae19ecd","block_type":"box","text":"assets in U.S. Government securities, money market securities and cash. If an acquisition that meets","page_number":180,"box":{"x":116,"y":102,"width":756,"height":13}},{"id":"f57d5550-f023-4976-866d-03697f28586f","block_type":"box","text":"the requirements for the SPAC is not completed within a pre-established period of time, the invested","page_number":180,"box":{"x":116,"y":118,"width":749,"height":12}},{"id":"2bbad3ac-53d1-4564-a72b-55c924d86d27","block_type":"box","text":"funds are returned to the SPAC’s public shareholders, the warrants expire, and the “founder’s” shares","page_number":180,"box":{"x":116,"y":134,"width":761,"height":11}},{"id":"501132bf-a46f-46c2-9c46-b9db49a40c95","block_type":"box","text":"and such warrants become worthless. Because SPACs and similar entities are in essence “blank","page_number":180,"box":{"x":116,"y":149,"width":725,"height":10}},{"id":"cea17377-d133-4331-ba1a-a946aad84991","block_type":"box","text":"check” companies without operating histories or ongoing business operations (other than identifying","page_number":180,"box":{"x":116,"y":165,"width":745,"height":12}},{"id":"7fb29759-ce25-4a9d-b81c-53beb3ee6dc9","block_type":"box","text":"and pursuing acquisitions), the potential for the long-term capital appreciation of their securities is","page_number":180,"box":{"x":116,"y":180,"width":728,"height":12}},{"id":"17077328-0f51-4786-b023-4b556b97a83e","block_type":"box","text":"particularly dependent on the ability of the SPAC’s management to identify and complete a profitable","page_number":180,"box":{"x":117,"y":196,"width":751,"height":12}},{"id":"01cfae68-edc3-4645-be5a-01fc07ccb31d","block_type":"box","text":"acquisition. There is no guarantee that the SPACs in which a Fund invests will complete an acquisition","page_number":180,"box":{"x":116,"y":211,"width":766,"height":12}},{"id":"44aa2342-a944-47ff-98b6-6c09094d87cd","block_type":"box","text":"or that any acquisitions completed by the SPACs in which the Fund invests will be profitable. Some","page_number":180,"box":{"x":116,"y":227,"width":740,"height":12}},{"id":"d2b5ed59-f84e-4776-9f9e-c0f31bddb49c","block_type":"box","text":"SPACs may pursue acquisitions only within certain industries or regions, which may ultimately lead to","page_number":180,"box":{"x":116,"y":242,"width":758,"height":12}},{"id":"08c7d57f-8fca-4095-8fe7-6327b4feea69","block_type":"box","text":"an increase in the volatility of their prices following the acquisition. In addition, some of these securities","page_number":180,"box":{"x":116,"y":258,"width":768,"height":12}},{"id":"27d15870-a3d6-4fc8-9b36-396345bb3e6c","block_type":"box","text":"may be considered illiquid and/or subject to restrictions on resale.","page_number":180,"box":{"x":117,"y":273,"width":491,"height":12}},{"id":"e1baaf9e-41a4-4792-93cf-bb293a7ab293","block_type":"box","text":"Standby Commitment Agreements.","page_number":180,"box":{"x":117,"y":301,"width":278,"height":12}},{"id":"5beae574-87d2-4849-ae55-fc42e4aa37b4","block_type":"box","text":"Standby commitment agreements commit a Fund, for a stated","page_number":180,"box":{"x":396,"y":301,"width":471,"height":12}},{"id":"3e0e5085-451e-4d5e-857e-732853d69e56","block_type":"box","text":"period of time, to purchase a stated amount of securities that may be issued and sold to that Fund at","page_number":180,"box":{"x":117,"y":316,"width":750,"height":13}},{"id":"2026c8ff-8a17-444c-af32-23dd6272e303","block_type":"box","text":"the option of the issuer. The price of the security is fixed at the time of the commitment. At the time of","page_number":180,"box":{"x":116,"y":332,"width":756,"height":12}},{"id":"f4d35761-2426-43eb-9584-921db40ba2f2","block_type":"box","text":"entering into the agreement, a Fund is paid a commitment fee, regardless of whether or not the","page_number":180,"box":{"x":116,"y":347,"width":711,"height":13}},{"id":"e2fdeb5f-ae7a-4bbc-abc5-1b4192942039","block_type":"box","text":"security is ultimately issued. A Fund will enter into such agreements for the purpose of investing in the","page_number":180,"box":{"x":116,"y":363,"width":762,"height":12}},{"id":"916a2d38-0b58-4134-b311-a3aa5bb90992","block_type":"box","text":"security underlying the commitment at a price that is considered advantageous to the Fund.","page_number":180,"box":{"x":116,"y":379,"width":685,"height":12}},{"id":"c744f6c8-bd26-47c7-b76a-dea179f7ee85","block_type":"box","text":"There can be no assurance that the securities subject to a standby commitment will be issued, and the","page_number":180,"box":{"x":116,"y":407,"width":767,"height":11}},{"id":"be67d0c1-5d23-4932-8b36-b3a20e1dfa2f","block_type":"box","text":"value of the security, if issued, on the delivery date may be more or less than its purchase price. Since","page_number":180,"box":{"x":116,"y":422,"width":764,"height":12}},{"id":"5af02ed1-fc5c-4cf7-859a-e45ed5307e0c","block_type":"box","text":"the issuance of the security underlying the commitment is at the option of the issuer, the Fund may","page_number":180,"box":{"x":116,"y":437,"width":738,"height":12}},{"id":"8d282538-e7ee-4939-96d5-80913c7b2e85","block_type":"box","text":"bear the risk of a decline in the value of such security and may not benefit from an appreciation in the","page_number":180,"box":{"x":117,"y":453,"width":756,"height":12}},{"id":"f2ec7f74-f6e6-4d49-b3c3-f06d9a8a4fa9","block_type":"box","text":"value of the security during the commitment period.","page_number":180,"box":{"x":116,"y":468,"width":386,"height":12}},{"id":"2a912844-8c89-4191-afad-1fa2acda1e5e","block_type":"box","text":"The purchase of a security pursuant to a standby commitment agreement and the related commitment","page_number":180,"box":{"x":116,"y":496,"width":756,"height":12}},{"id":"7b3bac90-95be-4d84-91d9-67eb5a3b2283","block_type":"box","text":"fee will be recorded on the date on which the security can reasonably be expected to be issued, and the","page_number":180,"box":{"x":116,"y":512,"width":769,"height":12}},{"id":"0c5e05a2-e1b5-4032-b931-90b5e09071e8","block_type":"box","text":"value of the security thereafter will be reflected in the calculation of a Fund’s NAV. The cost basis of the","page_number":180,"box":{"x":116,"y":527,"width":765,"height":12}},{"id":"d2c39f1c-6e4f-440a-822d-93eed7f7ff45","block_type":"box","text":"security will be adjusted by the amount of the commitment fee. In the event the security is not issued,","page_number":180,"box":{"x":116,"y":543,"width":748,"height":12}},{"id":"2b7d60c2-1d1d-473a-987f-03dcaf96b7fb","block_type":"box","text":"the commitment fee will be recorded as income on the expiration date of the standby commitment.","page_number":180,"box":{"x":116,"y":558,"width":727,"height":12}},{"id":"7e5289f3-b3e4-44f8-a88a-96c585c7f8a6","block_type":"box","text":"Standby commitments will only be entered into with dealers, banks and broker-dealers which, in the","page_number":180,"box":{"x":116,"y":586,"width":744,"height":12}},{"id":"70f258b9-a16e-4a16-9498-c7537e02fc49","block_type":"box","text":"Manager’s or sub-adviser’s opinion, present minimal credit risks. A Fund will acquire standby","page_number":180,"box":{"x":117,"y":602,"width":693,"height":12}},{"id":"2d05cc82-ac45-4018-814d-bb53458db221","block_type":"box","text":"commitments solely to facilitate portfolio liquidity and not to exercise its rights thereunder for trading","page_number":180,"box":{"x":116,"y":617,"width":744,"height":12}},{"id":"94cd0ef1-6c90-4d09-b022-32e7ebf3f507","block_type":"box","text":"purposes. Standby commitments will be valued at zero in determining NAV. Accordingly, where a Fund","page_number":180,"box":{"x":117,"y":633,"width":769,"height":12}},{"id":"eb6cc709-8ead-4686-8c49-fa29a803c9b0","block_type":"box","text":"pays directly or indirectly for a standby commitment, its cost will be reflected as an unrealized loss for","page_number":180,"box":{"x":117,"y":648,"width":756,"height":12}},{"id":"b81fe77a-3d06-4cec-b522-6faec101c26f","block_type":"box","text":"the period during which the commitment is held by such Fund and will be reflected as a realized gain or","page_number":180,"box":{"x":116,"y":664,"width":767,"height":12}},{"id":"d6dd97d7-7464-4cd5-86a6-3d66db525f0e","block_type":"box","text":"loss when the commitment is exercised or expires.","page_number":180,"box":{"x":117,"y":679,"width":373,"height":12}},{"id":"06f3284a-f6cc-4762-b7f7-46f084e4816c","block_type":"box","text":"Stripped Securities.","page_number":180,"box":{"x":117,"y":707,"width":156,"height":12}},{"id":"4e4c3a8e-c908-44a1-8749-4cbbd594de2d","block_type":"box","text":"Stripped securities are created when the issuer separates the interest and","page_number":180,"box":{"x":279,"y":707,"width":549,"height":12}},{"id":"40ae6106-6e0c-4575-9b14-c0e74183f75a","block_type":"box","text":"principal components of an instrument and sells them as separate securities. In general, one security is","page_number":180,"box":{"x":117,"y":723,"width":765,"height":12}},{"id":"0bf73f01-ef17-4ca7-b817-f3e32b0d234d","block_type":"box","text":"entitled to receive the interest payments on the underlying assets (the interest only or “IO” security)","page_number":180,"box":{"x":116,"y":738,"width":734,"height":12}},{"id":"05e3099a-e446-4602-9013-739e15b27d9b","block_type":"box","text":"and the other to receive the principal payments (the principal only or “PO” security). Some stripped","page_number":180,"box":{"x":116,"y":754,"width":731,"height":12}},{"id":"dad87b75-7730-4457-9e16-2b3ce5a616f0","block_type":"box","text":"securities may receive a combination of interest and principal payments. The yields to maturity on IOs","page_number":180,"box":{"x":116,"y":769,"width":755,"height":12}},{"id":"4d84f3e4-1a68-41b6-8c66-bca1941b7730","block_type":"box","text":"and POs are sensitive to the expected or anticipated rate of principal payments (including","page_number":180,"box":{"x":116,"y":785,"width":663,"height":12}},{"id":"a2b8cbf7-6ab7-4cf8-a5d0-db1268ec0400","block_type":"box","text":"prepayments) on the related underlying assets, and principal payments may have a material effect on","page_number":180,"box":{"x":117,"y":800,"width":752,"height":12}},{"id":"04753efe-3c85-49df-8ded-33502df88fd3","block_type":"box","text":"yield to maturity. If the underlying assets experience greater than anticipated prepayments of principal,","page_number":180,"box":{"x":116,"y":816,"width":760,"height":12}},{"id":"ab593399-230b-4d54-9053-cd142f2b0940","block_type":"box","text":"a Fund may not fully recoup its initial investment in IOs. Conversely, if the underlying assets","page_number":180,"box":{"x":116,"y":831,"width":686,"height":12}},{"id":"6a9fe935-3f9b-4c46-89fe-773d2664ecb5","block_type":"box","text":"experience less than anticipated prepayments of principal, the yield on POs could be adversely","page_number":180,"box":{"x":116,"y":847,"width":711,"height":12}},{"id":"6a7074a5-e6d1-4edf-95be-30cbf8bee563","block_type":"box","text":"affected. Stripped securities may be highly sensitive to changes in interest rates and rates of","page_number":180,"box":{"x":116,"y":862,"width":691,"height":12}},{"id":"f17af19f-6b5e-422e-8d85-573e8cf1401a","block_type":"box","text":"prepayment.","page_number":180,"box":{"x":117,"y":878,"width":97,"height":12}},{"id":"ae778b81-e83f-4172-b79c-dffefea98cca","block_type":"box","text":"II-96","page_number":180,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"ac1c3d65-2c32-473b-9de4-c480b2209aaf","block_type":"box","text":"NM0926U-5926888-180/257","page_number":180,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"c740a521-c945-4b40-af6b-f5d52e47fcb4","block_type":"box","text":"Structured Notes.","page_number":181,"box":{"x":117,"y":87,"width":139,"height":10}},{"id":"3457a543-ed04-4be3-a770-8cdbbaf8b57f","block_type":"box","text":"Structured notes and other related instruments purchased by a Fund are generally","page_number":181,"box":{"x":257,"y":87,"width":621,"height":12}},{"id":"b675e31f-7768-471f-adcd-9f794d522560","block_type":"box","text":"privately negotiated debt obligations where the principal and/or interest is determined by reference to","page_number":181,"box":{"x":117,"y":102,"width":753,"height":13}},{"id":"d1482752-eb47-4f95-8256-58eb9eebd026","block_type":"box","text":"the performance of a specific asset, benchmark asset, market or interest rate (“reference measure”).","page_number":181,"box":{"x":116,"y":118,"width":751,"height":12}},{"id":"e359ba5d-4c6b-49c8-9a30-1064242ad8ab","block_type":"box","text":"Issuers of structured notes generally include corporations and banks. The interest rate or the principal","page_number":181,"box":{"x":117,"y":134,"width":760,"height":12}},{"id":"c0f4726a-3e10-4fe7-95af-ad4c9fcd61bc","block_type":"box","text":"amount payable upon maturity or redemption may increase or decrease, depending upon changes in","page_number":181,"box":{"x":116,"y":149,"width":754,"height":12}},{"id":"bbd5091f-93f7-46a9-aa4d-cddd750b88c6","block_type":"box","text":"the value of the reference measure. The terms of a structured note may provide that, in certain","page_number":181,"box":{"x":116,"y":165,"width":708,"height":12}},{"id":"793043d1-3b2c-4a9b-8b3c-28268f395295","block_type":"box","text":"circumstances, no principal is due at maturity and, therefore, may result in a loss of invested capital by","page_number":181,"box":{"x":116,"y":180,"width":765,"height":12}},{"id":"2d109478-8fed-4bd1-8aee-b2cfa12a25bc","block_type":"box","text":"a Fund. The interest and/or principal payments that may be made on a structured product may vary","page_number":181,"box":{"x":116,"y":196,"width":743,"height":12}},{"id":"96d40add-71bf-474a-948f-e741560dcd43","block_type":"box","text":"widely, depending on a variety of factors, including the volatility of the reference measure.","page_number":181,"box":{"x":116,"y":211,"width":671,"height":12}},{"id":"9c4aa65d-b8f7-4fa3-b9ba-b17606179a2d","block_type":"box","text":"Structured notes may be positively or negatively indexed, so the appreciation of the reference measure","page_number":181,"box":{"x":116,"y":242,"width":770,"height":12}},{"id":"303f9877-0596-4648-b285-f85a67bb68e1","block_type":"box","text":"may produce an increase or a decrease in the interest rate or the value of the principal at maturity. The","page_number":181,"box":{"x":117,"y":258,"width":768,"height":12}},{"id":"e0a8f6b7-8e0b-4913-b6bf-75d0659f0838","block_type":"box","text":"rate of return on structured notes may be determined by applying a multiplier to the performance or","page_number":181,"box":{"x":117,"y":273,"width":739,"height":12}},{"id":"c27b23a1-fcfc-4d06-b788-9ee38db68fc7","block_type":"box","text":"differential performance of reference measures. Application of a multiplier involves leverage that will","page_number":181,"box":{"x":116,"y":289,"width":746,"height":12}},{"id":"4c7c15f4-7000-4a03-bbc9-bb23b0e18caf","block_type":"box","text":"serve to magnify the potential for gain and the risk of loss.","page_number":181,"box":{"x":116,"y":304,"width":435,"height":12}},{"id":"7bd8ab2b-03da-4052-9f54-343a0fe10df7","block_type":"box","text":"The purchase of structured notes exposes a Fund to the credit risk of the issuer of the structured","page_number":181,"box":{"x":116,"y":335,"width":722,"height":12}},{"id":"9ca81d7e-0654-4402-8c80-ad9710f308a2","block_type":"box","text":"product. Structured notes may also be more volatile, less liquid, and more difficult to price accurately","page_number":181,"box":{"x":117,"y":351,"width":750,"height":12}},{"id":"6828d790-2589-40fd-8b22-e198b2980a6c","block_type":"box","text":"than less complex securities and instruments or more traditional debt securities. The secondary market","page_number":181,"box":{"x":116,"y":366,"width":770,"height":12}},{"id":"5b7c9c7e-7f3d-4a62-93c4-04e4b0731c66","block_type":"box","text":"for structured notes could be illiquid making them difficult to sell when the Fund determines to sell","page_number":181,"box":{"x":116,"y":382,"width":729,"height":12}},{"id":"5622ec23-e76e-4f16-aaf5-40297cecf8b6","block_type":"box","text":"them. The possible lack of a liquid secondary market for structured notes and the resulting inability of","page_number":181,"box":{"x":116,"y":397,"width":755,"height":12}},{"id":"95ef48e8-5976-46ea-bef7-98c9dce20424","block_type":"box","text":"the Fund to sell a structured note could expose the Fund to losses and could make structured notes","page_number":181,"box":{"x":116,"y":413,"width":746,"height":12}},{"id":"b2871a22-08e8-487b-89ca-4062f155dfc1","block_type":"box","text":"more difficult for the Fund to value accurately.","page_number":181,"box":{"x":117,"y":428,"width":344,"height":12}},{"id":"c3b68591-3a14-4f88-a1d1-37422c83810e","block_type":"box","text":"Taxability Risk.","page_number":181,"box":{"x":118,"y":459,"width":119,"height":12}},{"id":"0bf357e8-1722-4670-b3f7-922a1add4bf7","block_type":"box","text":"Certain of the Funds intend to minimize the payment of taxable income to","page_number":181,"box":{"x":238,"y":459,"width":555,"height":12}},{"id":"7f65452b-2ec2-4158-a07c-11985abe2204","block_type":"box","text":"shareholders by investing in tax-exempt or municipal securities in reliance at the time of purchase on","page_number":181,"box":{"x":116,"y":475,"width":753,"height":12}},{"id":"1986f9f5-b7a1-4e13-9b2b-542b3329fade","block_type":"box","text":"an opinion of bond counsel to the issuer and, in the case of derivative securities, sponsors’ counsel,","page_number":181,"box":{"x":116,"y":490,"width":745,"height":12}},{"id":"33cf084b-1f3a-4f53-a2d8-a1b13649fea7","block_type":"box","text":"that the interest paid on those securities will be excludable from gross income for U.S. federal income","page_number":181,"box":{"x":116,"y":506,"width":759,"height":12}},{"id":"5cbbda69-c1e2-4433-8a4d-eee5b01db03f","block_type":"box","text":"tax purposes. Such securities, however, may be determined to pay, or have paid, taxable income","page_number":181,"box":{"x":116,"y":521,"width":726,"height":12}},{"id":"378150fc-d066-4803-9b9d-23136a81d24c","block_type":"box","text":"subsequent to the Fund’s acquisition of the securities. In that event, the IRS may demand that the","page_number":181,"box":{"x":116,"y":537,"width":731,"height":12}},{"id":"2db32f36-ab03-43a9-ada9-2d820107ea8a","block_type":"box","text":"Fund pay U.S. federal income taxes on the affected interest income, and, if the Fund agrees to do so,","page_number":181,"box":{"x":117,"y":552,"width":758,"height":12}},{"id":"3fcb5a51-7c0d-4539-8921-238d74ff20b7","block_type":"box","text":"the Fund’s yield could be adversely affected. In addition, the treatment of dividends previously paid or","page_number":181,"box":{"x":116,"y":568,"width":758,"height":12}},{"id":"28f43b75-2ddf-4b27-9ee6-f8f11c6f1154","block_type":"box","text":"to be paid by the Fund as “exempt interest dividends” could be adversely affected, subjecting the","page_number":181,"box":{"x":116,"y":583,"width":724,"height":12}},{"id":"a472b7c1-30cd-4e43-a3b3-3d9f7ad6d6a5","block_type":"box","text":"Fund’s shareholders to increased U.S. federal income tax liabilities. If the interest paid on any","page_number":181,"box":{"x":117,"y":599,"width":699,"height":12}},{"id":"eac7f27d-8260-4941-9def-2cba88d141b9","block_type":"box","text":"tax-exempt or municipal security held by the Fund is subsequently determined to be taxable, the Fund","page_number":181,"box":{"x":116,"y":614,"width":762,"height":12}},{"id":"a1875fa4-1534-4e07-aa23-9c4665d2b34c","block_type":"box","text":"will dispose of that security as soon as reasonably practicable. In addition, future laws, regulations,","page_number":181,"box":{"x":116,"y":630,"width":738,"height":12}},{"id":"5d989120-9fe5-4d94-bfcc-e30821e7630a","block_type":"box","text":"rulings or court decisions may cause interest on municipal securities to be subject, directly or indirectly,","page_number":181,"box":{"x":117,"y":645,"width":769,"height":12}},{"id":"71526e4e-91ef-4cda-ab31-0dcfd97194f6","block_type":"box","text":"to U.S. federal income taxation or interest on state municipal securities to be subject to state or local","page_number":181,"box":{"x":116,"y":661,"width":744,"height":12}},{"id":"8ef38dc8-0400-41d7-b8ff-a3c0da1ced6c","block_type":"box","text":"income taxation, or the value of state municipal securities to be subject to state or local intangible","page_number":181,"box":{"x":117,"y":676,"width":721,"height":12}},{"id":"585e0b97-4559-486e-b802-5b0c7c631b0f","block_type":"box","text":"personal property tax, or may otherwise prevent the Fund from realizing the full current benefit of the","page_number":181,"box":{"x":117,"y":692,"width":745,"height":12}},{"id":"2b25b7f2-e119-403f-a37f-f70f3588f957","block_type":"box","text":"tax-exempt status of such securities. Any such change could also affect the market price of such","page_number":181,"box":{"x":116,"y":707,"width":716,"height":12}},{"id":"00af4645-4b47-4921-938b-43927b22571c","block_type":"box","text":"securities, and thus the value of an investment in the Fund.","page_number":181,"box":{"x":116,"y":723,"width":438,"height":11}},{"id":"bc5d1585-9ba0-491a-966c-0c12514626b1","block_type":"box","text":"Temporary Defensive Measures.","page_number":181,"box":{"x":118,"y":754,"width":255,"height":12}},{"id":"214838d4-7a1b-450e-8dfe-2094371b8856","block_type":"box","text":"As a temporary defensive measure, including to respond to adverse","page_number":181,"box":{"x":379,"y":754,"width":503,"height":12}},{"id":"6b398719-32c6-4555-9f61-45200c4c21b4","block_type":"box","text":"market, economic, political or other conditions, a Fund may depart from its principal investment","page_number":181,"box":{"x":117,"y":769,"width":704,"height":12}},{"id":"136c2b97-8ed2-488a-84cc-711227016ef6","block_type":"box","text":"strategies and may invest without limitation in cash, high quality money market instruments, or other","page_number":181,"box":{"x":116,"y":785,"width":743,"height":12}},{"id":"235f6c47-5cda-4095-8849-84b3148c7ee3","block_type":"box","text":"short term investments. Certain Funds may also invest in cash and other such instruments pending","page_number":181,"box":{"x":116,"y":800,"width":735,"height":12}},{"id":"142cfd02-ed42-4488-9f6a-ea5a3d8a7866","block_type":"box","text":"investment or to meet anticipated redemption requests. High quality money market instruments include","page_number":181,"box":{"x":117,"y":816,"width":763,"height":12}},{"id":"2bbe7b12-7381-420d-bfcc-ef8adb355d18","block_type":"box","text":"U.S. Government obligations, U.S. Government agency obligations, dollar denominated obligations of","page_number":181,"box":{"x":117,"y":831,"width":758,"height":12}},{"id":"379cd22e-5484-4ec4-b3c4-8b8fd466aeb5","block_type":"box","text":"foreign issuers, bank obligations, including U.S. subsidiaries and branches of foreign banks, corporate","page_number":181,"box":{"x":116,"y":847,"width":763,"height":12}},{"id":"5c28583f-62b9-45be-b84b-373dccdc80a3","block_type":"box","text":"obligations, commercial paper, repurchase agreements and obligations of supranational organizations.","page_number":181,"box":{"x":116,"y":862,"width":767,"height":12}},{"id":"17fe3b6d-9a2d-498d-baa9-83cbe0416910","block_type":"box","text":"Generally, such obligations will mature within one year from the date of settlement but may mature","page_number":181,"box":{"x":117,"y":878,"width":735,"height":12}},{"id":"f0826f41-4d82-4305-8cde-b2a9fc3f09a5","block_type":"box","text":"II-97","page_number":181,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"c37019e8-15c8-4c95-a533-8288944aa49e","block_type":"box","text":"NM0926U-5926888-181/257","page_number":181,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"13e8e0de-bbe0-4d70-9064-d4c2071b0834","block_type":"box","text":"within two years from the date of settlement. Temporary defensive measures may affect a Fund’s","page_number":182,"box":{"x":116,"y":87,"width":727,"height":12}},{"id":"34e1f26f-3fe5-4f1e-9cc3-067be3b50ec2","block_type":"box","text":"ability to achieve its investment objective.","page_number":182,"box":{"x":116,"y":103,"width":312,"height":12}},{"id":"b5a14f60-efba-49bb-bd72-5409de1b4ee4","block_type":"box","text":"U.S. Government Obligations.","page_number":182,"box":{"x":117,"y":134,"width":236,"height":12}},{"id":"d098d704-a51a-4d2b-a5af-0a461ab8fa99","block_type":"box","text":"A Fund may purchase obligations issued or guaranteed by the U.S.","page_number":182,"box":{"x":354,"y":134,"width":510,"height":12}},{"id":"c0e065fe-4073-4d28-8116-a37fdd0ba597","block_type":"box","text":"Government and U.S. Government agencies and instrumentalities. Obligations of certain agencies and","page_number":182,"box":{"x":117,"y":149,"width":767,"height":12}},{"id":"39d8f153-131d-4a8a-8ebf-c69f8b5a5c6e","block_type":"box","text":"instrumentalities of the U.S. Government are supported by the full faith and credit of the U.S. Treasury.","page_number":182,"box":{"x":117,"y":165,"width":767,"height":12}},{"id":"12da2759-91b6-4673-9530-cb317700d5bb","block_type":"box","text":"Others are supported by the right of the issuer to borrow from the U.S. Treasury; and still others are","page_number":182,"box":{"x":116,"y":180,"width":745,"height":12}},{"id":"6224d4e0-c3c8-4066-9c6a-16d0419e85e8","block_type":"box","text":"supported only by the credit of the agency or instrumentality issuing the obligation. No assurance can","page_number":182,"box":{"x":116,"y":196,"width":757,"height":12}},{"id":"91e7c21f-d162-4932-a648-6a13c99734d9","block_type":"box","text":"be given that the U.S. Government will provide financial support to U.S. Government-sponsored","page_number":182,"box":{"x":117,"y":211,"width":715,"height":12}},{"id":"fe73e749-d7de-41b4-95e7-aa8bcf2ff7c4","block_type":"box","text":"instrumentalities if it is not obligated to do so by law. Certain U.S. Treasury and agency securities may","page_number":182,"box":{"x":117,"y":227,"width":762,"height":12}},{"id":"e82d57d7-d167-4da2-b62e-2bde5632418b","block_type":"box","text":"be held by trusts that issue participation certificates (such as Treasury income growth receipts and","page_number":182,"box":{"x":117,"y":242,"width":734,"height":12}},{"id":"1b31c25f-7f86-4f64-8442-acd5890c7675","block_type":"box","text":"certificates of accrual on Treasury certificates). These certificates, as well as Treasury receipts and","page_number":182,"box":{"x":116,"y":258,"width":740,"height":12}},{"id":"81f305c7-2280-4a39-b7ca-df7bd3244158","block_type":"box","text":"other stripped securities, represent beneficial ownership interests in either future interest payments or","page_number":182,"box":{"x":116,"y":273,"width":759,"height":12}},{"id":"150f53b8-1e86-49a3-a6e4-0790eee21305","block_type":"box","text":"the future principal payments on U.S. Government obligations. These instruments are issued at a","page_number":182,"box":{"x":116,"y":289,"width":727,"height":12}},{"id":"3982a5e8-47ea-4199-8f36-133cecb5dd2c","block_type":"box","text":"discount to their “face value” and may (particularly in the case of stripped mortgage-backed securities)","page_number":182,"box":{"x":116,"y":304,"width":763,"height":12}},{"id":"c1f281b0-db82-4d69-a996-e9c931fececf","block_type":"box","text":"exhibit greater price volatility than ordinary debt securities because of the manner in which their","page_number":182,"box":{"x":116,"y":320,"width":713,"height":12}},{"id":"ec80d39e-8b42-4caa-97f0-7051722e59bb","block_type":"box","text":"principal and interest are returned to investors.","page_number":182,"box":{"x":117,"y":335,"width":351,"height":12}},{"id":"f97a8f38-5f4c-4d26-8dbf-927e1a4b16ea","block_type":"box","text":"Examples of the types of U.S. Government obligations that may be held by the Funds include U.S.","page_number":182,"box":{"x":117,"y":366,"width":734,"height":12}},{"id":"2ca936b0-a13d-4e63-89e7-c2ff9939197e","block_type":"box","text":"Treasury Bills, Treasury Notes and Treasury Bonds and the obligations of the Federal Housing","page_number":182,"box":{"x":116,"y":382,"width":708,"height":12}},{"id":"24e22b6a-6a9b-4024-bc79-e7661a5e1027","block_type":"box","text":"Administration, Farmers Home Administration, Export-Import Bank of the United States, Small","page_number":182,"box":{"x":116,"y":397,"width":703,"height":12}},{"id":"09b510d9-3427-4718-af44-ace761ff42ed","block_type":"box","text":"Business Administration, Ginnie Mae, Fannie Mae, Federal Financing Bank, General Services","page_number":182,"box":{"x":117,"y":413,"width":702,"height":12}},{"id":"cec6ed38-5cde-4bd0-a166-08da815ea6b1","block_type":"box","text":"Administration, Student Loan Marketing Association, Central Bank for Cooperatives, Federal Home","page_number":182,"box":{"x":116,"y":428,"width":741,"height":12}},{"id":"f9206c61-4de5-4f81-bf67-9a45642e480f","block_type":"box","text":"Loan Banks, Freddie Mac, Federal Intermediate Credit Banks, Federal Land Banks, Farm Credit Banks","page_number":182,"box":{"x":117,"y":444,"width":771,"height":11}},{"id":"d39d2a54-c706-4f33-b584-f82fcc71cb37","block_type":"box","text":"System, Maritime Administration, Tennessee Valley Authority and Washington D.C. Armory Board. The","page_number":182,"box":{"x":116,"y":459,"width":772,"height":12}},{"id":"c687f40c-54c8-436d-bd19-aa79cbb58cdf","block_type":"box","text":"Funds may also invest in mortgage-related securities issued or guaranteed by U.S. Government","page_number":182,"box":{"x":117,"y":475,"width":717,"height":12}},{"id":"b8ce83f0-3b5f-4483-8eac-705fd4ef5166","block_type":"box","text":"agencies and instrumentalities, including such instruments as obligations of Ginnie Mae, Fannie Mae","page_number":182,"box":{"x":116,"y":490,"width":754,"height":12}},{"id":"692556ac-4d00-400b-899f-2bb10779b8ef","block_type":"box","text":"and Freddie Mac.","page_number":182,"box":{"x":116,"y":506,"width":135,"height":9}},{"id":"a93c9856-22a7-46d7-a62f-cef0ee1cc1f5","block_type":"box","text":"U.S. Treasury Obligations.","page_number":182,"box":{"x":117,"y":537,"width":194,"height":12}},{"id":"eb71d6b1-d3ec-4743-b232-f6d6f3465a8e","block_type":"box","text":"Treasury obligations may differ in their interest rates, maturities, times of","page_number":182,"box":{"x":313,"y":537,"width":548,"height":12}},{"id":"2fadfc3f-3e27-44c8-98c7-c5db528b7bf2","block_type":"box","text":"issuance and other characteristics. Obligations of U.S. Government agencies and authorities are","page_number":182,"box":{"x":117,"y":552,"width":721,"height":12}},{"id":"2c42be72-4559-41d4-abae-507062bf8568","block_type":"box","text":"supported by varying degrees of credit but generally are not backed by the full faith and credit of the","page_number":182,"box":{"x":116,"y":568,"width":747,"height":12}},{"id":"f94ec014-f20b-499b-9fb4-379a0537b0e0","block_type":"box","text":"U.S. Government. No assurance can be given that the U.S. Government will provide financial support","page_number":182,"box":{"x":117,"y":583,"width":758,"height":12}},{"id":"9cd896b9-4853-4390-aad8-fcaf37301260","block_type":"box","text":"to its agencies and authorities if it is not obligated by law to do so.","page_number":182,"box":{"x":116,"y":599,"width":493,"height":12}},{"id":"b256c858-466b-4d82-a6b7-82b668164d44","block_type":"box","text":"U.S. Treasury Rolls.","page_number":182,"box":{"x":117,"y":630,"width":153,"height":12}},{"id":"a51f542e-e214-44b0-adb8-71d0004a2c19","block_type":"box","text":"Certain Funds may invest in U.S. Treasury","page_number":182,"box":{"x":271,"y":630,"width":320,"height":12}},{"id":"47668592-3cc8-43bf-9267-7d17a9d07163","block_type":"box","text":"rolls. In a U.S. Treasury roll transaction,","page_number":182,"box":{"x":592,"y":630,"width":292,"height":12}},{"id":"08d1eebe-c617-40ab-ae24-07d4c2fb556a","block_type":"box","text":"the Fund sells a treasury security to a counterpa","page_number":182,"box":{"x":116,"y":645,"width":350,"height":12}},{"id":"2502acf6-82c5-4e6e-a546-1bcca79f2733","block_type":"box","text":"rty with a simultaneous agreement to repurchase the","page_number":182,"box":{"x":468,"y":645,"width":387,"height":12}},{"id":"e25e35ac-ac7b-4c0b-8265-904e6658601c","block_type":"box","text":"same security at an agreed upon price and future settl","page_number":182,"box":{"x":116,"y":661,"width":392,"height":12}},{"id":"53baf4d9-f263-4eea-a93e-20eb0249caf2","block_type":"box","text":"ement date. U.S. Treasury roll transactions may","page_number":182,"box":{"x":510,"y":661,"width":348,"height":12}},{"id":"70f3a89a-6677-4226-8536-46fd027de8bd","block_type":"box","text":"incrementally adjust the average maturity of a Fund’","page_number":182,"box":{"x":117,"y":676,"width":376,"height":12}},{"id":"e307099d-8ab2-4465-b8bf-686d73c4dd37","block_type":"box","text":"s portfolio and increase the interest yield on the","page_number":182,"box":{"x":494,"y":676,"width":343,"height":12}},{"id":"fac9db94-7cce-4e0e-b98a-2eebd2ab7d9e","block_type":"box","text":"Fund’s portfolio by extending the average maturity of the portfolio in a normal yield curve environment.","page_number":182,"box":{"x":117,"y":692,"width":740,"height":12}},{"id":"b39dd068-616d-454a-839c-932bff262ca5","block_type":"box","text":"During the period before the settlement","page_number":182,"box":{"x":117,"y":707,"width":284,"height":12}},{"id":"0df39d87-6bd4-45e5-87d9-8a03be727854","block_type":"box","text":"date of a U.S. Treasury roll, a","page_number":182,"box":{"x":406,"y":707,"width":214,"height":12}},{"id":"82f3e271-e384-4727-a50a-08af125073b7","block_type":"box","text":"Fund continues to earn interest on","page_number":182,"box":{"x":626,"y":707,"width":248,"height":10}},{"id":"f8c788fd-8985-4c99-88e9-3b4018a4b4bb","block_type":"box","text":"the securities it is selling; however, it does not earn in","page_number":182,"box":{"x":116,"y":723,"width":387,"height":12}},{"id":"579e7105-10fd-407d-8c6f-e66621d98021","block_type":"box","text":"terest on the securities it is purchasing until after the","page_number":182,"box":{"x":504,"y":723,"width":378,"height":12}},{"id":"d88995c8-d5a3-4e83-81aa-bd31b004dd23","block_type":"box","text":"settlement date. A Fund could suffer an opportunity loss","page_number":182,"box":{"x":116,"y":738,"width":406,"height":12}},{"id":"d0b62c4e-373c-4c02-9698-7554b16149a4","block_type":"box","text":"if the counterparty to the U.S. Treasury roll","page_number":182,"box":{"x":528,"y":738,"width":308,"height":12}},{"id":"a5c6c8ba-61a8-4ff3-88a7-ef7e37322dbd","block_type":"box","text":"transaction failed to perform its obligations on the settlement date.","page_number":182,"box":{"x":116,"y":754,"width":478,"height":12}},{"id":"2d819c73-d8c6-42b8-b960-5d2b5bf5697c","block_type":"box","text":"The market value of the securities that a Fund is required to purchase may decline below the agreed","page_number":182,"box":{"x":116,"y":785,"width":745,"height":12}},{"id":"dc858bc2-b0b7-4af5-ab4f-5cc93279cb5e","block_type":"box","text":"upon purchase price of those securities. U.S. Treasury rolls are speculative techniques that can be","page_number":182,"box":{"x":117,"y":800,"width":732,"height":12}},{"id":"297397f7-d659-4c85-94ba-83e74abf165a","block_type":"box","text":"deemed to involve leverage. There is no assurance that U.S. Treasury rolls can be successfully","page_number":182,"box":{"x":116,"y":816,"width":709,"height":12}},{"id":"29c45e40-adae-433f-9db9-987127ffb6f4","block_type":"box","text":"employed.","page_number":182,"box":{"x":116,"y":831,"width":82,"height":12}},{"id":"1b872087-4fdd-4130-8336-c67adf282f02","block_type":"box","text":"Utility Industries.","page_number":182,"box":{"x":117,"y":862,"width":140,"height":12}},{"id":"ad1fd775-9fff-4a89-9bad-d14faec4b6ae","block_type":"box","text":"Risks that are intrinsic to the utility industries include difficulty in obtaining an","page_number":182,"box":{"x":259,"y":862,"width":572,"height":12}},{"id":"da6b2a05-da86-47bc-97ea-dfa49d1c2a9f","block_type":"box","text":"adequate return on invested capital, difficulty in financing large construction programs during an","page_number":182,"box":{"x":116,"y":878,"width":715,"height":12}},{"id":"537fefd4-ae92-4c05-9c76-ee56f6eb76bc","block_type":"box","text":"II-98","page_number":182,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"435ee3ec-bca7-40d7-acd0-65e8a004ad0f","block_type":"box","text":"NM0926U-5926888-182/257","page_number":182,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"4be47f7a-117a-4e2e-ab75-404e65d87403","block_type":"box","text":"inflationary period, restrictions on operations and increased cost and delays attributable to","page_number":183,"box":{"x":117,"y":87,"width":672,"height":12}},{"id":"c67dc886-6177-4373-85b2-2e20c2a6e2b7","block_type":"box","text":"environmental considerations and regulation, difficulty in raising capital in adequate amounts on","page_number":183,"box":{"x":116,"y":102,"width":715,"height":13}},{"id":"479118f7-ad51-47c8-837d-8eaa8a723358","block_type":"box","text":"reasonable terms in periods of high inflation and unsettled capital markets, technological innovations","page_number":183,"box":{"x":117,"y":118,"width":750,"height":12}},{"id":"915a9c85-f0d3-4ff3-8fd3-60b143633d9f","block_type":"box","text":"that may render existing plants, equipment or products obsolete, the potential impact of natural or","page_number":183,"box":{"x":116,"y":134,"width":729,"height":12}},{"id":"37f3b58c-e796-416a-9f17-5dc5474537bd","block_type":"box","text":"man-made disasters, increased costs and reduced availability of certain types of fuel, occasional","page_number":183,"box":{"x":117,"y":149,"width":721,"height":12}},{"id":"8839613e-22e8-4e40-aacb-9d788289548d","block_type":"box","text":"reduced availability and high costs of natural gas for resale, the effects of energy conservation, the","page_number":183,"box":{"x":117,"y":165,"width":736,"height":12}},{"id":"4febe9e1-ba28-4c1b-892c-1667e6c93c99","block_type":"box","text":"effects of a national energy policy and lengthy delays and greatly increased costs and other problems","page_number":183,"box":{"x":116,"y":180,"width":759,"height":12}},{"id":"7dab908e-4b4e-4941-a3d3-ee867af4f6df","block_type":"box","text":"associated with the design, construction, licensing, regulation and operation of nuclear facilities for","page_number":183,"box":{"x":116,"y":196,"width":735,"height":12}},{"id":"6ff19d91-e826-4ecf-86f4-f3b5c663cce1","block_type":"box","text":"electric generation, including, among other considerations, the problems associated with the use of","page_number":183,"box":{"x":116,"y":211,"width":740,"height":12}},{"id":"277f4868-a5b5-4546-8b8f-6ab6b5f8bd18","block_type":"box","text":"radioactive materials and the disposal of radioactive wastes. There are substantial differences among","page_number":183,"box":{"x":117,"y":227,"width":757,"height":12}},{"id":"5b0f242a-ef1d-4a58-8c8d-fab7e324a39f","block_type":"box","text":"the regulatory practices and policies of various jurisdictions, and any given regulatory agency may","page_number":183,"box":{"x":116,"y":242,"width":732,"height":12}},{"id":"b6cd9373-e994-4412-ad8e-3376e69dfff1","block_type":"box","text":"make major shifts in policy from time to time. There is no assurance that regulatory authorities will, in","page_number":183,"box":{"x":117,"y":258,"width":752,"height":12}},{"id":"baf797f3-f50f-48bf-a428-c05d5eeff959","block_type":"box","text":"the future, grant rate increases or that such increases will be adequate to permit the payment of","page_number":183,"box":{"x":116,"y":273,"width":716,"height":12}},{"id":"3d61713b-f3f5-4bd3-9a70-015c2b15a974","block_type":"box","text":"dividends on common stocks issued by a utility company. Additionally, existing and possible future","page_number":183,"box":{"x":116,"y":289,"width":735,"height":12}},{"id":"a876d986-5f44-4d1b-b1d0-2dbfd43fc14a","block_type":"box","text":"regulatory legislation may make it even more difficult for utilities to obtain adequate relief. Certain of the","page_number":183,"box":{"x":117,"y":304,"width":771,"height":12}},{"id":"77ff76bb-80be-418f-a8df-0fd445d3bccc","block_type":"box","text":"issuers of securities held in the Fund’s portfolio may own or operate nuclear generating facilities.","page_number":183,"box":{"x":117,"y":320,"width":720,"height":12}},{"id":"e12666c5-5455-46c7-9a4c-a363949eaae6","block_type":"box","text":"Governmental authorities may from time to time review existing policies and impose additional","page_number":183,"box":{"x":117,"y":335,"width":702,"height":12}},{"id":"6685feff-de09-4af5-80cb-f3ed378e0e0a","block_type":"box","text":"requirements governing the licensing, construction and operation of nuclear power plants. Prolonged","page_number":183,"box":{"x":117,"y":351,"width":751,"height":12}},{"id":"7af59a68-dd2a-4c41-91a8-65973c8b4a25","block_type":"box","text":"changes in climatic conditions can also have a significant impact on both the revenues of an electric","page_number":183,"box":{"x":116,"y":366,"width":746,"height":12}},{"id":"97f01eb5-8562-476d-9c55-b43408e6f824","block_type":"box","text":"and gas utility as well as the expenses of a utility, particularly a hydro-based electric utility.","page_number":183,"box":{"x":116,"y":382,"width":675,"height":12}},{"id":"b49b9a96-b241-4957-819e-a2e3869c6a72","block_type":"box","text":"Companies in the utilities sector may be adversely affected by changes in exchange rates, domestic","page_number":183,"box":{"x":117,"y":413,"width":747,"height":12}},{"id":"0b3e3fce-6052-4b87-9745-94347487d689","block_type":"box","text":"and international competition, and governmental limitations on rates charged to customers. The value","page_number":183,"box":{"x":116,"y":428,"width":759,"height":12}},{"id":"a4aa678c-4cd9-4282-a4c5-7eef22edfb74","block_type":"box","text":"of regulated utility debt securities and, to a lesser extent, equity securities, tends to have an inverse","page_number":183,"box":{"x":116,"y":444,"width":743,"height":12}},{"id":"7b3aa421-1942-493b-8dd6-47d455ad6c9f","block_type":"box","text":"relationship to the movement of interest rates and therefore may lead to volatility in performance.","page_number":183,"box":{"x":117,"y":459,"width":723,"height":12}},{"id":"c7fedbf0-46cf-47f3-8884-d61917c17869","block_type":"box","text":"Utility companies in the United States and in foreign countries are generally subject to regulation. In the","page_number":183,"box":{"x":117,"y":490,"width":771,"height":12}},{"id":"9637b0cc-3c7f-4b72-a762-b45e659eb76f","block_type":"box","text":"United States, most utility companies are regulated by state and/or federal authorities. Such regulation","page_number":183,"box":{"x":117,"y":506,"width":764,"height":12}},{"id":"91acb0ac-d011-416d-b822-5fc8287f81ec","block_type":"box","text":"is intended to ensure appropriate standards of service and adequate capacity to meet public demand.","page_number":183,"box":{"x":117,"y":521,"width":759,"height":12}},{"id":"43787aa3-0dcc-4bd5-bb62-147d0c5dc2fd","block_type":"box","text":"Generally, prices are also regulated in the United States and in foreign countries with the intention of","page_number":183,"box":{"x":117,"y":537,"width":750,"height":12}},{"id":"b1518b55-eb18-4cee-a172-b66c9db007e6","block_type":"box","text":"protecting the public while ensuring that the rate of return earned by utility companies is sufficient to","page_number":183,"box":{"x":117,"y":552,"width":744,"height":12}},{"id":"ffbc86d9-d61e-4d68-bba6-a7fca947f530","block_type":"box","text":"allow them to attract capital in order to grow and continue to provide appropriate services. There can","page_number":183,"box":{"x":116,"y":568,"width":751,"height":12}},{"id":"89d430e7-3c59-4df8-9079-9eba394a5e97","block_type":"box","text":"be no assurance that such pricing policies or rates of return will continue in the future.","page_number":183,"box":{"x":117,"y":583,"width":640,"height":12}},{"id":"245d2ecb-8b3f-4413-9e53-517d026eef62","block_type":"box","text":"The nature of regulation of the utility industries continues to evolve both in the United States and in","page_number":183,"box":{"x":116,"y":614,"width":738,"height":12}},{"id":"1976898d-62a3-4c46-96b0-29635096bce5","block_type":"box","text":"foreign countries. In recent years, changes in regulation in the United States increasingly have allowed","page_number":183,"box":{"x":116,"y":630,"width":767,"height":12}},{"id":"56c6020c-bc8a-4ac7-bc98-031e483c4c7f","block_type":"box","text":"utility companies to provide services and products outside their traditional geographic areas and lines","page_number":183,"box":{"x":117,"y":645,"width":755,"height":12}},{"id":"92ef4602-bffe-484a-a2f9-99e2a0464e06","block_type":"box","text":"of business, creating new areas of competition within the industries. In some instances, utility","page_number":183,"box":{"x":116,"y":661,"width":691,"height":12}},{"id":"db37de5a-376a-44fe-adf2-db93b4ae91a9","block_type":"box","text":"companies are operating on an unregulated basis. Because of trends toward deregulation and the","page_number":183,"box":{"x":116,"y":676,"width":727,"height":12}},{"id":"c7316031-7223-4f12-9ee9-d86c4dba6dae","block_type":"box","text":"evolution of independent power producers as well as new entrants to the field of telecommunications,","page_number":183,"box":{"x":116,"y":692,"width":750,"height":12}},{"id":"96fcb3a7-a783-40b4-80f1-fae87a6b81d9","block_type":"box","text":"non-regulated providers of utility services have become a significant part of their respective industries.","page_number":183,"box":{"x":117,"y":707,"width":755,"height":12}},{"id":"64e69da8-30c1-4d5f-81c8-5ac83f78c2db","block_type":"box","text":"The Manager believes that the emergence of competition and deregulation will result in certain utility","page_number":183,"box":{"x":116,"y":723,"width":745,"height":12}},{"id":"84229865-5c72-4e6a-85f1-17e6f6eaf5c8","block_type":"box","text":"companies being able to earn more than their traditional regulated rates of return, while others may be","page_number":183,"box":{"x":116,"y":738,"width":759,"height":12}},{"id":"d09cb8e7-9b77-407f-a1f5-b65e5803770e","block_type":"box","text":"forced to defend their core business from increased competition and may be less profitable. Reduced","page_number":183,"box":{"x":116,"y":754,"width":751,"height":12}},{"id":"2da6bf51-b0cf-4df9-96ab-24e03e82ec32","block_type":"box","text":"profitability, as well as new uses of funds (such as for expansion, operations or stock buybacks) could","page_number":183,"box":{"x":117,"y":769,"width":754,"height":12}},{"id":"1448ce83-9138-4329-90be-41a81898b603","block_type":"box","text":"result in cuts in dividend payout rates. As deregulation allows utility companies to diversify outside of","page_number":183,"box":{"x":117,"y":785,"width":746,"height":12}},{"id":"eb81773e-e932-4cd7-989c-25037cad657f","block_type":"box","text":"their original geographic regions and their traditional lines of business, utilities companies may engage","page_number":183,"box":{"x":116,"y":800,"width":760,"height":12}},{"id":"84e1f214-7c16-41e6-b744-63ac312d870a","block_type":"box","text":"in riskier ventures. Therefore, deregulation may eliminate restrictions on the maximum level of profits of","page_number":183,"box":{"x":117,"y":816,"width":767,"height":12}},{"id":"c722fd23-9718-48fc-9c20-96e0d54c9b2b","block_type":"box","text":"certain utility companies, but may also subject these companies to greater risk of loss. The Manager","page_number":183,"box":{"x":116,"y":831,"width":749,"height":12}},{"id":"eec6a576-2bee-4946-b9cb-6638c821f5e0","block_type":"box","text":"seeks to take advantage of favorable investment opportunities that may arise from these structural","page_number":183,"box":{"x":116,"y":847,"width":735,"height":12}},{"id":"a57eb58b-62b4-4b4e-a5a3-0d57a761c218","block_type":"box","text":"changes. Of course, there can be no assurance that favorable developments will occur in the future.","page_number":183,"box":{"x":116,"y":862,"width":747,"height":12}},{"id":"40c1ef03-010f-4804-90a3-08b4ffdc21cc","block_type":"box","text":"II-99","page_number":183,"box":{"x":484,"y":909,"width":32,"height":9}},{"id":"96bd9607-a888-4aed-b6ea-3359ed61f98a","block_type":"box","text":"NM0926U-5926888-183/257","page_number":183,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"7098df0b-8258-43f4-9044-d03a88f54688","block_type":"box","text":"Foreign utility companies are also subject to regulation, although such regulations may or may not be","page_number":184,"box":{"x":117,"y":87,"width":755,"height":12}},{"id":"9e039326-cc0e-4b62-851e-dcce1a212cfd","block_type":"box","text":"comparable to those in the United States. Foreign utility companies may be more heavily regulated by","page_number":184,"box":{"x":116,"y":102,"width":761,"height":13}},{"id":"ede5cd07-bf31-4343-be24-b92054877ac1","block_type":"box","text":"their respective governments than utilities in the United States and, as in the United States, generally","page_number":184,"box":{"x":116,"y":118,"width":755,"height":12}},{"id":"6dca8be3-8051-4839-9f85-ee0f279d5bf7","block_type":"box","text":"are required to seek government approval for rate increases. In addition, many foreign utilities use","page_number":184,"box":{"x":116,"y":134,"width":733,"height":12}},{"id":"f7533b87-125a-4037-a035-e5db121605a3","block_type":"box","text":"fuels that may cause more pollution than those used in the United States, which may require such","page_number":184,"box":{"x":116,"y":149,"width":731,"height":12}},{"id":"aa3fb818-e551-40f8-a649-805798605f6c","block_type":"box","text":"utilities to invest in pollution control equipment to meet any proposed pollution restrictions. Foreign","page_number":184,"box":{"x":117,"y":165,"width":733,"height":12}},{"id":"fb9a177d-6ea0-4527-b6df-123f592024db","block_type":"box","text":"regulatory systems vary from country to country and may evolve in ways different from regulation in the","page_number":184,"box":{"x":117,"y":180,"width":770,"height":12}},{"id":"6d596561-7f14-4772-bb7f-a9a214501b05","block_type":"box","text":"United States.","page_number":184,"box":{"x":117,"y":196,"width":109,"height":9}},{"id":"5749434d-c392-424b-b185-c817e3854b62","block_type":"box","text":"A Fund’s investment policies are designed to enable it to capitalize on evolving investment opportunities","page_number":184,"box":{"x":116,"y":227,"width":769,"height":12}},{"id":"d6c75318-bd69-4e22-b71d-4ed4c075b50e","block_type":"box","text":"throughout the world. For example, the rapid growth of certain foreign economies will necessitate","page_number":184,"box":{"x":116,"y":242,"width":717,"height":12}},{"id":"d50880ec-16f9-430d-b095-6975807b38a1","block_type":"box","text":"expansion of capacity in the utility industries in those countries. Although many foreign utility companies","page_number":184,"box":{"x":116,"y":258,"width":767,"height":12}},{"id":"b9c9fa5e-ce80-47c0-a482-5cf13dfca583","block_type":"box","text":"currently are government-owned, thereby limiting current investment opportunities for a Fund, the","page_number":184,"box":{"x":116,"y":273,"width":720,"height":12}},{"id":"dad81e85-c282-4f41-8355-2dcb0746978d","block_type":"box","text":"Manager believes that, in order to attract significant capital for growth, foreign governments are likely to","page_number":184,"box":{"x":117,"y":289,"width":763,"height":12}},{"id":"5cf28155-5fd5-4c38-ae74-4c92a833997a","block_type":"box","text":"seek global investors through the privatization of their utility industries. Privatization, which refers to the","page_number":184,"box":{"x":116,"y":304,"width":762,"height":12}},{"id":"9aa78c4e-8a29-4482-856d-00ab806dcc8b","block_type":"box","text":"trend toward investor ownership of assets rather than government ownership, is expected to occur in","page_number":184,"box":{"x":116,"y":320,"width":745,"height":12}},{"id":"f980970e-24ea-4835-97e7-22f6c3543612","block_type":"box","text":"newer, faster-growing economies and in mature economies. Of course, there is no assurance that such","page_number":184,"box":{"x":117,"y":335,"width":763,"height":12}},{"id":"d2e1a5f8-843a-4abf-92ab-5b5e52f3c044","block_type":"box","text":"favorable developments will occur or that investment opportunities in foreign markets will increase.","page_number":184,"box":{"x":116,"y":351,"width":728,"height":12}},{"id":"86162dfe-0cd7-4ec1-8204-bf78bae55969","block_type":"box","text":"The revenues of domestic and foreign utility companies generally reflect the economic growth and","page_number":184,"box":{"x":116,"y":382,"width":732,"height":12}},{"id":"97fc03f0-570a-4c8f-930b-c65dc7b4ce3c","block_type":"box","text":"development in the geographic areas in which they do business. The Manager will take into account","page_number":184,"box":{"x":116,"y":397,"width":747,"height":12}},{"id":"528cf9dc-3b06-4440-a0a9-71dedd7a9867","block_type":"box","text":"anticipated economic growth rates and other economic developments when selecting securities of","page_number":184,"box":{"x":116,"y":413,"width":732,"height":12}},{"id":"675f6737-5678-4f20-a6c4-7b219c80a2f1","block_type":"box","text":"utility companies.","page_number":184,"box":{"x":117,"y":428,"width":132,"height":12}},{"id":"baa49c7c-baac-4f3a-abe5-3363547cba04","block_type":"box","text":"Electric.","page_number":184,"box":{"x":116,"y":459,"width":58,"height":10}},{"id":"61761f21-d580-42e0-9678-cfb123d062cf","block_type":"box","text":"The electric utility industry consists of companies that are engaged principally in the","page_number":184,"box":{"x":176,"y":459,"width":630,"height":12}},{"id":"636e57bd-2fdf-4fcb-a839-ce68ce2b5381","block_type":"box","text":"generation, transmission and sale of electric energy, although many also provide other energy-related","page_number":184,"box":{"x":116,"y":475,"width":760,"height":12}},{"id":"5ff016a6-6a75-41c2-922f-a7f73e6785a0","block_type":"box","text":"services. In the past, electric utility companies, in general, have been favorably affected by lower fuel","page_number":184,"box":{"x":116,"y":490,"width":754,"height":12}},{"id":"a9d9df69-a77c-4cf6-8d10-07e2f3da2315","block_type":"box","text":"and financing costs and the full or near completion of major construction programs. In addition, many","page_number":184,"box":{"x":116,"y":506,"width":754,"height":12}},{"id":"476a50f0-e557-43ef-8845-f383b3129bd8","block_type":"box","text":"of these companies have generated cash flows in excess of current operating expenses and","page_number":184,"box":{"x":116,"y":521,"width":690,"height":12}},{"id":"b3860d48-7f90-477c-bc2d-222cb8431ef1","block_type":"box","text":"construction expenditures, permitting some degree of diversification into unregulated businesses.","page_number":184,"box":{"x":116,"y":537,"width":727,"height":12}},{"id":"98bbbe80-6be2-4a7c-8381-6aef7b8684b7","block_type":"box","text":"Some electric utilities have also taken advantage of the right to sell power outside of their traditional","page_number":184,"box":{"x":116,"y":552,"width":744,"height":12}},{"id":"c29ce762-0a3d-4ffe-8e0a-0a0a6932015c","block_type":"box","text":"geographic areas. Electric utility companies have historically been subject to the risks associated with","page_number":184,"box":{"x":116,"y":568,"width":758,"height":12}},{"id":"f794b36e-1cad-4861-a0dc-7939d152d9b7","block_type":"box","text":"increases in fuel and other operating costs, high interest costs on borrowings needed for capital","page_number":184,"box":{"x":117,"y":583,"width":714,"height":12}},{"id":"3a8999e0-b293-45ca-b5b8-dbe98b2b6ceb","block_type":"box","text":"construction programs, costs associated with compliance with environmental and safety regulations","page_number":184,"box":{"x":116,"y":599,"width":744,"height":12}},{"id":"0c376787-41c3-4a44-8db8-7645f6cd218e","block_type":"box","text":"and changes in the regulatory climate. As interest rates declined, many utilities refinanced high cost","page_number":184,"box":{"x":116,"y":614,"width":744,"height":12}},{"id":"c947d62c-fb79-44ce-b242-6730972241b8","block_type":"box","text":"debt and in doing so improved their fixed charges coverage. Regulators, however, lowered allowed","page_number":184,"box":{"x":116,"y":630,"width":740,"height":12}},{"id":"89b7ef1a-cc93-4b66-a2ed-5264bf8e0a07","block_type":"box","text":"rates of return as interest rates declined and thereby caused the benefits of the rate declines to be","page_number":184,"box":{"x":117,"y":645,"width":734,"height":12}},{"id":"a53ebe80-d368-4f4c-a8fd-9c8955963987","block_type":"box","text":"shared wholly or in part with customers. In a period of rising interest rates, the allowed rates of return","page_number":184,"box":{"x":116,"y":661,"width":748,"height":12}},{"id":"1b7fd981-be6d-4c61-9748-8d8ed368a694","block_type":"box","text":"may not keep pace with the utilities’ increased costs. The construction and operation of nuclear power","page_number":184,"box":{"x":117,"y":676,"width":756,"height":12}},{"id":"ef940351-282e-467b-9f40-471ba5124d7a","block_type":"box","text":"facilities are subject to strict scrutiny by, and evolving regulations of, the Nuclear Regulatory","page_number":184,"box":{"x":116,"y":692,"width":682,"height":12}},{"id":"248e54e6-3986-4859-91a2-c7888dbe93ac","block_type":"box","text":"Commission and state agencies which have comparable jurisdiction. Strict scrutiny might result in","page_number":184,"box":{"x":117,"y":707,"width":722,"height":12}},{"id":"03ce41ea-47f6-4914-95f0-117ab23b5565","block_type":"box","text":"higher operating costs and higher capital expenditures, with the risk that the regulators may disallow","page_number":184,"box":{"x":117,"y":723,"width":743,"height":12}},{"id":"91a42e57-8b7e-427c-a43e-6e0041ff5c04","block_type":"box","text":"inclusion of these costs in rate authorizations or the risk that a company may not be permitted to","page_number":184,"box":{"x":117,"y":738,"width":713,"height":12}},{"id":"5e9cfe8b-56fa-4ff4-a57e-1c24d350ed50","block_type":"box","text":"operate or complete construction of a facility. In addition, operators of nuclear power plants may be","page_number":184,"box":{"x":116,"y":754,"width":735,"height":12}},{"id":"15aaf7f5-25c3-41e8-9463-15322fa09fcd","block_type":"box","text":"subject to significant costs for disposal of nuclear fuel and for decommissioning such plants.","page_number":184,"box":{"x":116,"y":769,"width":681,"height":12}},{"id":"9fad4844-c049-4025-af36-f51506b85150","block_type":"box","text":"The rating agencies look closely at the business profile of utilities. Ratings for companies are expected","page_number":184,"box":{"x":116,"y":800,"width":760,"height":12}},{"id":"6348164c-3f36-4a94-af61-462448b400f4","block_type":"box","text":"to be impacted to a greater extent in the future by the division of their asset base. Electric utility","page_number":184,"box":{"x":116,"y":816,"width":706,"height":12}},{"id":"2e3f596a-cdf6-41a0-8b72-459c6b77df21","block_type":"box","text":"companies that focus more on the generation of electricity may be assigned less favorable ratings as","page_number":184,"box":{"x":116,"y":831,"width":754,"height":12}},{"id":"8adfdff8-9af0-47af-b449-e6bf5093b631","block_type":"box","text":"this business is expected to be competitive and the least regulated. On the other hand, companies that","page_number":184,"box":{"x":116,"y":847,"width":768,"height":12}},{"id":"0ee9ef4f-3c6b-4259-81ef-eb93875d5883","block_type":"box","text":"focus on transmission and distribution, which is expected to be the least competitive and the more","page_number":184,"box":{"x":116,"y":862,"width":732,"height":12}},{"id":"a1cc60bd-9828-455e-a7e7-005f1a36a81d","block_type":"box","text":"regulated part of the business, may see higher ratings given the greater predictability of cash flow.","page_number":184,"box":{"x":117,"y":878,"width":732,"height":12}},{"id":"f8e436b6-7521-4588-a5b4-2888b4ec08ce","block_type":"box","text":"II-100","page_number":184,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"9a220da5-4cd4-413f-9e3c-13f375ee1946","block_type":"box","text":"NM0926U-5926888-184/257","page_number":184,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"c7fc6631-758a-4dc9-93fb-968d39486240","block_type":"box","text":"A number of states are considering or have enacted deregulation proposals. The introduction of","page_number":185,"box":{"x":116,"y":87,"width":715,"height":12}},{"id":"63d83da4-7294-455c-a015-6059b57e7279","block_type":"box","text":"competition into the industry as a result of such deregulation has at times resulted in lower revenue,","page_number":185,"box":{"x":116,"y":102,"width":746,"height":13}},{"id":"897020fc-aef0-4828-a49f-4e0c7c18c963","block_type":"box","text":"lower credit ratings, increased default risk, and lower electric utility security prices. Such increased","page_number":185,"box":{"x":117,"y":118,"width":734,"height":12}},{"id":"3cc7d936-9c53-43ff-8f04-7768f0c5ddfd","block_type":"box","text":"competition may also cause long-term contracts, which electric utilities previously entered into to buy","page_number":185,"box":{"x":116,"y":134,"width":752,"height":12}},{"id":"efe3e284-1919-41f2-9ba4-05c1a1d30484","block_type":"box","text":"power, to become “stranded assets” which have no economic value. Any loss associated with such","page_number":185,"box":{"x":117,"y":149,"width":739,"height":12}},{"id":"cef66ff7-4b7c-4f9a-a040-242d7a7ba7c7","block_type":"box","text":"contracts must be absorbed by ratepayers and investors. In addition, some electric utilities have","page_number":185,"box":{"x":116,"y":165,"width":717,"height":12}},{"id":"5b4883d3-617a-4011-91bf-b27e6f24fa71","block_type":"box","text":"acquired electric utilities overseas to diversify, enhance earnings and gain experience in operating in a","page_number":185,"box":{"x":116,"y":180,"width":765,"height":12}},{"id":"b0c23e81-f396-49ab-8884-3050a6e90030","block_type":"box","text":"deregulated environment. In some instances, such acquisitions have involved significant borrowings,","page_number":185,"box":{"x":116,"y":196,"width":752,"height":12}},{"id":"f58a5afb-7985-41f2-a748-580372ccbdd9","block_type":"box","text":"which have burdened the acquirer’s balance sheet. There is no assurance that current deregulation","page_number":185,"box":{"x":116,"y":211,"width":743,"height":12}},{"id":"2edbca86-ccf3-44ac-94ba-dc2acb3cb836","block_type":"box","text":"proposals will be adopted. However, deregulation in any form could significantly impact the electric","page_number":185,"box":{"x":117,"y":227,"width":736,"height":12}},{"id":"12bfd579-204f-4351-940a-a563c13ce416","block_type":"box","text":"utilities industry.","page_number":185,"box":{"x":117,"y":242,"width":123,"height":12}},{"id":"9f24f5b6-97eb-4fbb-b040-7c04b6121ae7","block_type":"box","text":"Telecommunications.","page_number":185,"box":{"x":118,"y":273,"width":155,"height":10}},{"id":"5d834447-abef-445c-851c-cb8624c9a01e","block_type":"box","text":"The telecommunications industry today includes both traditional telephone","page_number":185,"box":{"x":275,"y":273,"width":561,"height":12}},{"id":"efbfbab1-7088-443f-8a41-ef01f47a0198","block_type":"box","text":"companies, with a history of broad market coverage and highly regulated businesses, and cable","page_number":185,"box":{"x":116,"y":289,"width":717,"height":12}},{"id":"780eef5a-dcc5-44ef-b591-9c9236f73449","block_type":"box","text":"companies, which began as small, lightly regulated businesses focused on limited markets. Today","page_number":185,"box":{"x":116,"y":304,"width":733,"height":12}},{"id":"b10a297b-4af3-435e-a36d-94f16cd6b866","block_type":"box","text":"these two historically different businesses are converging in an industry that is trending toward larger,","page_number":185,"box":{"x":116,"y":320,"width":758,"height":12}},{"id":"a28ac449-7e22-45d9-9c18-7971d722d3b1","block_type":"box","text":"competitive national and international markets with an emphasis on deregulation. Companies that","page_number":185,"box":{"x":116,"y":335,"width":729,"height":12}},{"id":"fe180eb3-9b4b-4fe5-b098-419788a4af84","block_type":"box","text":"distribute telephone services and provide access to the telephone networks still comprise the greatest","page_number":185,"box":{"x":116,"y":351,"width":760,"height":12}},{"id":"2cb9b8da-0b88-4005-b865-0dcbbf813344","block_type":"box","text":"portion of this segment, but non-regulated activities such as wireless telephone services, paging, data","page_number":185,"box":{"x":117,"y":366,"width":759,"height":12}},{"id":"3a91231d-e45b-4eb6-bd2f-43efdb99a858","block_type":"box","text":"transmission and processing, equipment retailing, computer software and hardware and internet","page_number":185,"box":{"x":116,"y":382,"width":718,"height":12}},{"id":"fd7dab82-a053-494f-9f4c-ae2208e6a4be","block_type":"box","text":"services are becoming increasingly significant components as well. In particular, wireless and internet","page_number":185,"box":{"x":116,"y":397,"width":759,"height":12}},{"id":"7d9b389f-4b54-41ae-9c27-dee077b438e4","block_type":"box","text":"telephone services continue to gain market share at the expense of traditional telephone companies.","page_number":185,"box":{"x":116,"y":413,"width":752,"height":12}},{"id":"e54f7edd-fccd-4645-ac8a-3d732597755a","block_type":"box","text":"The presence of unregulated companies in this industry and the entry of traditional telephone","page_number":185,"box":{"x":116,"y":428,"width":696,"height":12}},{"id":"5d25ed59-a82a-42b2-9d68-00f0ea7266f5","block_type":"box","text":"companies into unregulated or less regulated businesses provide significant investment opportunities","page_number":185,"box":{"x":116,"y":444,"width":755,"height":12}},{"id":"cc2a202d-f372-445c-90d0-183261374244","block_type":"box","text":"with companies that may increase their earnings at faster rates than had been allowed in traditional","page_number":185,"box":{"x":116,"y":459,"width":742,"height":12}},{"id":"ec25e2b3-3a9c-4530-b6af-a3501819159a","block_type":"box","text":"regulated businesses. Still, increasing competition, technological innovations and other structural","page_number":185,"box":{"x":117,"y":475,"width":722,"height":12}},{"id":"32434dd0-c28d-499b-8b55-7c52beb30887","block_type":"box","text":"changes could adversely affect the profitability of such utilities and the growth rate of their dividends.","page_number":185,"box":{"x":116,"y":490,"width":750,"height":12}},{"id":"d0993074-3548-439b-be53-f00b9b2e8494","block_type":"box","text":"Given mergers and proposed legislation and enforcement changes, it is likely that both traditional","page_number":185,"box":{"x":117,"y":506,"width":725,"height":12}},{"id":"70452f4e-d611-4d9c-b541-c520404cc4ef","block_type":"box","text":"telephone companies and cable companies will continue to provide an expanding range of utility","page_number":185,"box":{"x":116,"y":521,"width":718,"height":12}},{"id":"7f4e13d2-93f8-4a9e-8bae-01cc34a66ed6","block_type":"box","text":"services to both residential, corporate and governmental customers.","page_number":185,"box":{"x":116,"y":537,"width":511,"height":12}},{"id":"124ae9c0-6786-4592-ad94-6ec9bd72f487","block_type":"box","text":"Gas.","page_number":185,"box":{"x":117,"y":568,"width":33,"height":9}},{"id":"e648840b-a333-4941-9f2e-1022306b0477","block_type":"box","text":"Gas transmission companies and gas distribution companies are undergoing significant changes.","page_number":185,"box":{"x":151,"y":568,"width":733,"height":12}},{"id":"ed41920d-a7a2-43d9-b331-c893103d9696","block_type":"box","text":"In the United States, interstate transmission companies are regulated by the Federal Energy","page_number":185,"box":{"x":117,"y":583,"width":689,"height":12}},{"id":"17a3ce0d-2136-461a-a906-07be42624ae9","block_type":"box","text":"Regulatory Commission, which is reducing its regulation of the industry. Many companies have","page_number":185,"box":{"x":117,"y":599,"width":709,"height":12}},{"id":"b2932304-e3f5-4b02-9914-a8345489cac2","block_type":"box","text":"diversified into oil and gas exploration and development, making returns more sensitive to energy","page_number":185,"box":{"x":116,"y":614,"width":728,"height":12}},{"id":"0ac5381c-6901-4384-8080-25a52758fc72","block_type":"box","text":"prices. In the recent decade, gas utility companies have been adversely affected by disruptions in the","page_number":185,"box":{"x":117,"y":630,"width":756,"height":12}},{"id":"2fa9364f-254e-486f-8607-dcc62fa42dee","block_type":"box","text":"oil industry and have also been affected by increased concentration and competition. In the opinion of","page_number":185,"box":{"x":116,"y":645,"width":759,"height":12}},{"id":"2b095edc-457f-4498-b918-30a01fd851e8","block_type":"box","text":"the Manager, however, environmental considerations could improve the gas industry outlook in the","page_number":185,"box":{"x":116,"y":661,"width":733,"height":12}},{"id":"f0177351-e9c4-4704-a683-b74dc9a270b2","block_type":"box","text":"future. For example, natural gas is the cleanest of the hydrocarbon fuels, and this may result in","page_number":185,"box":{"x":116,"y":676,"width":703,"height":12}},{"id":"c1c243a7-f7da-48f7-a091-d2eeb99828ae","block_type":"box","text":"incremental shifts in fuel consumption toward natural gas and away from oil and coal, even for","page_number":185,"box":{"x":117,"y":692,"width":698,"height":12}},{"id":"6032f2d5-76bf-4705-8d27-92a32cc15282","block_type":"box","text":"electricity generation. However, technological or regulatory changes within the industry may delay or","page_number":185,"box":{"x":116,"y":707,"width":745,"height":12}},{"id":"cf945880-9dad-4d16-8484-d330ced05976","block_type":"box","text":"prevent this result.","page_number":185,"box":{"x":117,"y":723,"width":135,"height":12}},{"id":"12de8ac7-87d7-4124-9dc0-be52beb7b2bd","block_type":"box","text":"Water.","page_number":185,"box":{"x":118,"y":754,"width":46,"height":9}},{"id":"19173f6b-6aeb-4d40-b271-c5fd826ec4a1","block_type":"box","text":"Water supply utilities are companies that collect, purify, distribute and sell water. In the United","page_number":185,"box":{"x":170,"y":754,"width":695,"height":12}},{"id":"17e83e37-0ec3-4216-952e-c47a09dccfc5","block_type":"box","text":"States and around the world the industry is highly fragmented because most of the supplies are owned","page_number":185,"box":{"x":116,"y":769,"width":762,"height":12}},{"id":"4bf497f9-2714-4517-b006-262940b4a6da","block_type":"box","text":"by local authorities. Companies in this industry are generally mature and are experiencing little or no","page_number":185,"box":{"x":117,"y":785,"width":743,"height":12}},{"id":"06d54270-62b9-4964-9905-3a00b0d706ce","block_type":"box","text":"per capita volume growth. In the opinion of the Manager, there may be opportunities for certain","page_number":185,"box":{"x":117,"y":800,"width":702,"height":12}},{"id":"e312b26e-50d3-4233-a026-521b1c721f8b","block_type":"box","text":"companies to acquire other water utility companies and for foreign acquisition of domestic companies.","page_number":185,"box":{"x":116,"y":816,"width":755,"height":12}},{"id":"0ba74bc2-8d15-4014-ba6d-780f1b7420d5","block_type":"box","text":"The Manager believes that favorable investment opportunities may result from consolidation of this","page_number":185,"box":{"x":116,"y":831,"width":738,"height":12}},{"id":"44da0172-ad11-4233-9e01-4ce6f1a2045d","block_type":"box","text":"segment. As with other utilities, however, increased regulation, increased costs and potential","page_number":185,"box":{"x":116,"y":847,"width":693,"height":12}},{"id":"890850f5-f540-4b1e-9052-ca17bab4df49","block_type":"box","text":"disruptions in supply may adversely affect investments in water supply utilities.","page_number":185,"box":{"x":116,"y":862,"width":588,"height":12}},{"id":"71a91410-ef2b-41b3-bee3-9579c56ef4e9","block_type":"box","text":"II-101","page_number":185,"box":{"x":480,"y":909,"width":38,"height":9}},{"id":"f83041fb-15f1-4195-bac7-7ffc36e45257","block_type":"box","text":"NM0926U-5926888-185/257","page_number":185,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"7f21b993-a1f0-4012-a791-2bd3340b3b7a","block_type":"box","text":"Utility Industries Generally.","page_number":186,"box":{"x":117,"y":87,"width":197,"height":12}},{"id":"a44fbe6a-19d1-4c2f-967d-2882a4ef8d9b","block_type":"box","text":"There can be no assurance that the positive developments noted above,","page_number":186,"box":{"x":316,"y":87,"width":548,"height":12}},{"id":"7033ee3b-afd9-474a-a3ef-7971e203664e","block_type":"box","text":"including those relating to privatization and changing regulation, will occur or that risk factors other than","page_number":186,"box":{"x":117,"y":102,"width":771,"height":13}},{"id":"5746215a-4fc5-42d7-9aca-6fc3cb13febe","block_type":"box","text":"those noted above will not develop in the future.","page_number":186,"box":{"x":116,"y":118,"width":361,"height":12}},{"id":"a2fbbd7d-2bb5-4bd0-bed8-27b0766ddec7","block_type":"box","text":"When-Issued Securities, Delayed Delivery Securities and Forward Commitments.","page_number":186,"box":{"x":118,"y":149,"width":643,"height":12}},{"id":"bff5a615-557b-4bae-8b5c-ab13058d3d6c","block_type":"box","text":"A Fund may","page_number":186,"box":{"x":762,"y":149,"width":100,"height":12}},{"id":"c1811b5a-3d1c-46d6-ad24-656944a7b4c1","block_type":"box","text":"purchase or sell securities that it is entitled to receive on a when-issued basis. A Fund may also","page_number":186,"box":{"x":117,"y":165,"width":713,"height":12}},{"id":"fadcc4a3-ab1d-4784-b5d2-0cce941c1841","block_type":"box","text":"purchase or sell securities on a delayed delivery basis or through a forward commitment (including on","page_number":186,"box":{"x":117,"y":180,"width":758,"height":12}},{"id":"5c5e4f35-dbd9-49fa-9e5e-d3c48dbe597d","block_type":"box","text":"a TBA (to be announced) basis). These transactions involve the purchase or sale of securities by a","page_number":186,"box":{"x":116,"y":196,"width":739,"height":12}},{"id":"3b19a554-0fa7-414f-9475-302163030856","block_type":"box","text":"Fund at an established price with payment and delivery taking place in the future. The Fund enters into","page_number":186,"box":{"x":117,"y":211,"width":767,"height":12}},{"id":"9cf4e7c3-c329-4de2-acc8-41506be5a26d","block_type":"box","text":"these transactions to obtain what is considered an advantageous price to the Fund at the time of","page_number":186,"box":{"x":116,"y":227,"width":721,"height":12}},{"id":"af8636eb-f043-49c6-ae73-08d7da9db2c9","block_type":"box","text":"entering into the transaction.","page_number":186,"box":{"x":116,"y":242,"width":217,"height":12}},{"id":"84a35f96-e67e-4b49-b181-ef281cb7c66e","block_type":"box","text":"Pursuant to recommendations of the Treasury Market Practices Group, which is sponsored by the","page_number":186,"box":{"x":117,"y":273,"width":731,"height":12}},{"id":"d4c0e6c8-4148-4dca-8400-8e05ff395efd","block_type":"box","text":"Federal Reserve Bank of New York, a Fund or its counterparty generally will be required to post","page_number":186,"box":{"x":117,"y":289,"width":714,"height":12}},{"id":"9d56927d-9674-4bb4-8d8e-9d4736f7fd5f","block_type":"box","text":"collateral when entering into certain forward-settling transactions, including without limitation TBA","page_number":186,"box":{"x":116,"y":304,"width":726,"height":12}},{"id":"6866b19f-3d1d-43ab-b729-fab284d04980","block_type":"box","text":"transactions. FINRA rules have also been implemented that include mandatory margin requirements","page_number":186,"box":{"x":116,"y":320,"width":750,"height":12}},{"id":"fd943902-6a2c-42e2-b21b-1dbca32d1ea4","block_type":"box","text":"for the TBA market with limited exceptions. The collateralization of TBA trades is intended to mitigate","page_number":186,"box":{"x":116,"y":335,"width":754,"height":12}},{"id":"f0700e6b-27c1-4b7e-828e-8ace3fd4d9aa","block_type":"box","text":"counterparty credit risk between trade and settlement, but could increase the cost of TBA transactions","page_number":186,"box":{"x":116,"y":351,"width":763,"height":12}},{"id":"b388fb64-65f7-4277-aa18-24cde2be903b","block_type":"box","text":"and impose added operational complexity.","page_number":186,"box":{"x":116,"y":366,"width":320,"height":12}},{"id":"45255c66-ddd8-4a54-af1f-0982304b01b5","block_type":"box","text":"There can be no assurance that a security purchased on a when-issued basis will be issued or that a","page_number":186,"box":{"x":116,"y":397,"width":754,"height":12}},{"id":"78f26457-713f-485a-ae0d-1d54496bd62a","block_type":"box","text":"security purchased or sold on a delayed delivery basis or through a forward commitment will be","page_number":186,"box":{"x":116,"y":413,"width":713,"height":12}},{"id":"c83d13e7-7429-4e45-b30f-03c69e0bd0bd","block_type":"box","text":"delivered. Also, the value of securities in these transactions on the delivery date may be more or less","page_number":186,"box":{"x":116,"y":428,"width":755,"height":12}},{"id":"36eeafd5-6311-4eef-af77-2be93798d7b9","block_type":"box","text":"than the price paid by the Fund to purchase the securities. The Fund will lose money if the value of the","page_number":186,"box":{"x":116,"y":444,"width":766,"height":12}},{"id":"eb236db1-023c-4337-898c-b0ed076cdeee","block_type":"box","text":"security in such a transaction declines below the purchase price and will not benefit if the value of the","page_number":186,"box":{"x":116,"y":459,"width":757,"height":12}},{"id":"2afb21f8-0169-4244-bd06-51d2032f2bbd","block_type":"box","text":"security appreciates above the sale price during the commitment period.","page_number":186,"box":{"x":116,"y":475,"width":542,"height":12}},{"id":"0b4604a4-e00e-4f5a-b74c-f7f46d3498b3","block_type":"box","text":"If deemed advisable as a matter of investment strategy, a Fund may dispose of or renegotiate a","page_number":186,"box":{"x":117,"y":506,"width":715,"height":12}},{"id":"18101025-2c47-41cd-9eff-bd147c4dbca8","block_type":"box","text":"commitment after it has been entered into, and may sell securities it has committed to purchase before","page_number":186,"box":{"x":116,"y":521,"width":767,"height":12}},{"id":"1c90e8f1-b805-4f3b-99c9-1f62779c16ee","block_type":"box","text":"those securities are delivered to the Fund on the settlement date. In these cases the Fund may realize","page_number":186,"box":{"x":116,"y":537,"width":764,"height":12}},{"id":"97e1be63-4fa2-4a9b-8907-a36c9947512b","block_type":"box","text":"a taxable capital gain or loss.","page_number":186,"box":{"x":116,"y":552,"width":221,"height":12}},{"id":"d3c56dc7-5f44-4d46-aec1-8d551ec6508c","block_type":"box","text":"When a Fund engages in when-issued, TBA or forward commitment transactions, it relies on the other","page_number":186,"box":{"x":116,"y":583,"width":763,"height":12}},{"id":"1fa96014-ec96-4679-a19a-283a277c92e2","block_type":"box","text":"party to consummate the trade. Failure of such party to do so may result in the Fund’s incurring a loss","page_number":186,"box":{"x":117,"y":599,"width":760,"height":12}},{"id":"7e9d939d-42ad-42dd-ae78-8ef193ab1595","block_type":"box","text":"or missing an opportunity to obtain a price considered to be advantageous.","page_number":186,"box":{"x":116,"y":614,"width":561,"height":12}},{"id":"a291934a-4655-4909-b336-891116420010","block_type":"box","text":"The market value of the securities underlying a commitment to purchase securities, and any","page_number":186,"box":{"x":116,"y":645,"width":688,"height":12}},{"id":"75ad821c-ac1d-4548-9962-85d17a57ce9f","block_type":"box","text":"subsequent fluctuations in their market value, is taken into account when determining the market value","page_number":186,"box":{"x":116,"y":661,"width":762,"height":12}},{"id":"8ee41d3c-d597-4871-9e10-7c78b18ad783","block_type":"box","text":"of a Fund starting on the day the Fund agrees to purchase the securities. The Fund does not earn","page_number":186,"box":{"x":116,"y":676,"width":726,"height":12}},{"id":"545d5cec-d7c1-4b5b-a0c5-55dda127c908","block_type":"box","text":"interest on the securities it has committed to purchase until they are paid for and delivered on the","page_number":186,"box":{"x":117,"y":692,"width":720,"height":12}},{"id":"993f0e85-54ab-4d23-97a7-22bde39504cd","block_type":"box","text":"settlement date.","page_number":186,"box":{"x":116,"y":707,"width":118,"height":10}},{"id":"e0ecdfaa-e46c-4b76-8321-dea566425b90","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into when-issued or forward","page_number":186,"box":{"x":117,"y":738,"width":740,"height":12}},{"id":"811f9094-0f7c-4b28-afd4-40058cc358c8","block_type":"box","text":"settling securities (e.g., firm and standby commitments, including TBA commitments, and dollar rolls)","page_number":186,"box":{"x":116,"y":754,"width":747,"height":12}},{"id":"53e7461e-6ded-4960-a0a5-275fa7c9a00b","block_type":"box","text":"and non-standard settlement cycle securities notwithstanding the limitation on the issuance of senior","page_number":186,"box":{"x":116,"y":769,"width":746,"height":12}},{"id":"905626b3-42e9-49fb-97de-875b85096285","block_type":"box","text":"securities in Section 18 of the Investment Company Act, provided that the Fund intends to physically","page_number":186,"box":{"x":116,"y":785,"width":745,"height":12}},{"id":"a4412011-88c3-4fa6-8fe9-6dbfb134f2ac","block_type":"box","text":"settle the transaction and the transaction will settle within 35 days of its trade date (the “Delayed","page_number":186,"box":{"x":116,"y":800,"width":719,"height":12}},{"id":"ad990b8e-2af4-40ef-8f37-e311fa8fda13","block_type":"box","text":"Settlement Securities Provision”). If a when-issued, forward-settling or non-standard settlement cycle","page_number":186,"box":{"x":116,"y":816,"width":749,"height":12}},{"id":"45f88da2-c795-476e-b76c-bba3ec0bdf78","block_type":"box","text":"security does not satisfy the Delayed-Settlement Securities Provision, then it is treated as a Derivatives","page_number":186,"box":{"x":116,"y":831,"width":771,"height":12}},{"id":"828a1078-3c45-4325-8506-f0670fc1c45a","block_type":"box","text":"Transaction under Rule 18f-4. See “— Derivatives — Regulation of Derivatives — Rule 18f-4 under the","page_number":186,"box":{"x":116,"y":847,"width":770,"height":12}},{"id":"409400fa-b8ce-4d59-921f-c051e6466a58","block_type":"box","text":"Investment Company Act” above.","page_number":186,"box":{"x":117,"y":862,"width":252,"height":12}},{"id":"68228a8d-bb51-4792-be44-7bfa3d35ac99","block_type":"box","text":"II-102","page_number":186,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"ddecd8a4-0c23-47cb-aa8e-cb009d65f799","block_type":"box","text":"NM0926U-5926888-186/257","page_number":186,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"de6e117c-41b3-46b4-8be3-22afd350f46f","block_type":"box","text":"Regulations adopted by global prudential regulators require certain bank-regulated counterparties and","page_number":187,"box":{"x":117,"y":87,"width":761,"height":12}},{"id":"c81015c6-8b96-4b30-a753-e6d2af7ae696","block_type":"box","text":"certain of their affiliates to include in certain financial contracts, including many agreements with","page_number":187,"box":{"x":116,"y":102,"width":716,"height":13}},{"id":"1d942274-67ee-43b4-bfd0-d563d629a606","block_type":"box","text":"respect to when-issued, TBA and forward commitment transactions, terms that delay or restrict the","page_number":187,"box":{"x":117,"y":118,"width":736,"height":12}},{"id":"69f4afc5-968a-4b5a-8a44-e3b57b183955","block_type":"box","text":"rights of counterparties, such as a Fund, to terminate such agreements, foreclose upon collateral,","page_number":187,"box":{"x":117,"y":134,"width":728,"height":12}},{"id":"e58cedf4-b422-4d03-b294-4751856db90b","block_type":"box","text":"exercise other default rights or restrict transfers of credit support in the event that the counterparty and/","page_number":187,"box":{"x":116,"y":149,"width":766,"height":12}},{"id":"fc265c46-89d3-45d8-8456-2882de802a59","block_type":"box","text":"or its affiliates are subject to certain types of resolution or insolvency proceedings. It is possible that","page_number":187,"box":{"x":116,"y":165,"width":744,"height":12}},{"id":"2a52c766-89d8-4fad-a8a6-3a9fc3b4ab39","block_type":"box","text":"these requirements, as well as potential additional government regulation and other developments in","page_number":187,"box":{"x":116,"y":180,"width":752,"height":12}},{"id":"34bf9141-eb70-4d33-8cc2-58376b0e84f0","block_type":"box","text":"the market, could adversely affect a Fund’s ability to terminate existing agreements with respect to","page_number":187,"box":{"x":116,"y":196,"width":735,"height":12}},{"id":"e8c93164-3e94-42fd-8bdb-b4e5d1b163f6","block_type":"box","text":"these transactions or to realize amounts to be received under such agreements.","page_number":187,"box":{"x":116,"y":211,"width":600,"height":12}},{"id":"f3815844-c307-4fdf-bd65-ef96357ccac4","block_type":"box","text":"Yields and Ratings.","page_number":187,"box":{"x":118,"y":242,"width":152,"height":12}},{"id":"f856eaf0-acbb-4ba5-aaf5-9c36c34715c3","block_type":"box","text":"The yields on certain obligations are dependent on a variety of factors, including","page_number":187,"box":{"x":271,"y":242,"width":604,"height":12}},{"id":"3313705a-af80-4adf-92f6-9b136903e9b5","block_type":"box","text":"general market conditions, conditions in the particular market for the obligation, the financial condition","page_number":187,"box":{"x":116,"y":258,"width":759,"height":12}},{"id":"c50810ad-566b-46cd-91eb-213ce1b704ba","block_type":"box","text":"of the issuer, the size of the offering, the maturity of the obligation and the ratings of the issue. The","page_number":187,"box":{"x":116,"y":273,"width":738,"height":12}},{"id":"31f96b67-c022-48b9-b1ca-9a92d6c8872e","block_type":"box","text":"ratings of Moody’s, Fitch and S&P represent their respective opinions as to the quality of the","page_number":187,"box":{"x":117,"y":289,"width":688,"height":12}},{"id":"1e4e40d6-3265-40c1-93ab-5e89f5f6a17a","block_type":"box","text":"obligations they undertake to rate. Ratings, however, are general and are not absolute standards of","page_number":187,"box":{"x":116,"y":304,"width":743,"height":12}},{"id":"3f74da5b-2441-4b53-a7bb-80f97c5b0db1","block_type":"box","text":"quality. Consequently, obligations with the same rating, maturity and interest rate may have different","page_number":187,"box":{"x":116,"y":320,"width":749,"height":12}},{"id":"f1c10991-67db-4f47-b617-01ec36cc0110","block_type":"box","text":"market prices. Subsequent to its purchase by a Fund, a rated security may cease to be rated. A Fund’s","page_number":187,"box":{"x":117,"y":335,"width":769,"height":12}},{"id":"d755ba52-9636-47e0-93af-b9aa2570ca8d","block_type":"box","text":"Manager or sub-adviser will consider such an event in determining whether the Fund should continue","page_number":187,"box":{"x":117,"y":351,"width":755,"height":12}},{"id":"00769f5d-6809-42e3-9b0c-846b4e19b982","block_type":"box","text":"to hold the security.","page_number":187,"box":{"x":116,"y":366,"width":150,"height":12}},{"id":"5b795d11-574d-4c32-a0b9-a48e35091f10","block_type":"box","text":"Zero Coupon Securities.","page_number":187,"box":{"x":116,"y":397,"width":193,"height":12}},{"id":"405a5191-a1ed-4ce1-a54c-e0b997cac591","block_type":"box","text":"Zero coupon securities are securities that are sold at a discount to par value","page_number":187,"box":{"x":310,"y":397,"width":575,"height":12}},{"id":"811d38ce-b85b-4ff6-ad3b-b13a5c997ae7","block_type":"box","text":"and do not pay interest during the life of the security. The discount approximates the total amount of","page_number":187,"box":{"x":116,"y":413,"width":747,"height":12}},{"id":"41c5f9cb-fbbf-4c57-a8d7-7cfbd8acdfd8","block_type":"box","text":"interest the security will accrue and compound over the period until maturity at a rate of interest","page_number":187,"box":{"x":117,"y":428,"width":711,"height":12}},{"id":"2d5de882-a475-420d-9859-1c2ecb9e4a78","block_type":"box","text":"reflecting the market rate of the security at the time of issuance. Upon maturity, the holder of a zero","page_number":187,"box":{"x":117,"y":444,"width":741,"height":12}},{"id":"4a958bc2-a902-42f0-89e2-4401f8f476e4","block_type":"box","text":"coupon security is entitled to receive the par value of the security.","page_number":187,"box":{"x":116,"y":459,"width":492,"height":12}},{"id":"dcc82eeb-9982-451d-b7fd-dcfeb4adb6dc","block_type":"box","text":"While interest payments are not made on such securities, holders of such securities are deemed to","page_number":187,"box":{"x":116,"y":490,"width":740,"height":12}},{"id":"499ed485-82ec-4c28-a8eb-3b50d7ead51e","block_type":"box","text":"have received income (“phantom income”) annually, notwithstanding that cash may not be received","page_number":187,"box":{"x":117,"y":506,"width":742,"height":12}},{"id":"d84e1ed9-330a-41b0-8bc8-75d3aa850518","block_type":"box","text":"currently. The effect of owning instruments that do not make current interest payments is that a fixed","page_number":187,"box":{"x":116,"y":521,"width":751,"height":12}},{"id":"369b97f0-a7a7-48e0-9188-fced523dea37","block_type":"box","text":"yield is earned not only on the original investment but also, in effect, on all discount accretion during","page_number":187,"box":{"x":116,"y":537,"width":746,"height":12}},{"id":"86aea1e6-af94-4dce-ba5e-317d4e5197cb","block_type":"box","text":"the life of the obligations. This implicit reinvestment of earnings at a fixed rate eliminates the risk of","page_number":187,"box":{"x":116,"y":552,"width":737,"height":12}},{"id":"493ffbd7-79b9-475d-8492-2dd4db790fea","block_type":"box","text":"being unable to invest distributions at a rate as high as the implicit yield on the zero coupon bond, but","page_number":187,"box":{"x":117,"y":568,"width":757,"height":12}},{"id":"0b530d38-f844-4e2d-90a2-caba21ef34c7","block_type":"box","text":"at the same time eliminates the holder’s ability to reinvest at higher rates in the future. For this reason,","page_number":187,"box":{"x":116,"y":583,"width":764,"height":12}},{"id":"00471a0e-8e59-48ec-a0ee-99bb6dc7a267","block_type":"box","text":"some of these securities may be subject to substantially greater price fluctuations during periods of","page_number":187,"box":{"x":116,"y":599,"width":739,"height":12}},{"id":"035e59b2-3e5d-4e12-b115-8d45921eb773","block_type":"box","text":"changing market interest rates than are comparable securities that pay interest currently. Longer term","page_number":187,"box":{"x":116,"y":614,"width":760,"height":12}},{"id":"452e8cd1-3673-458c-bdd7-43c252bda61c","block_type":"box","text":"zero coupon bonds are more exposed to interest rate risk than shorter term zero coupon bonds. These","page_number":187,"box":{"x":116,"y":630,"width":768,"height":12}},{"id":"9468df2e-06aa-40a9-8a7e-756326b029bb","block_type":"box","text":"investments benefit the issuer by mitigating its need for cash to meet debt service, but also require a","page_number":187,"box":{"x":117,"y":645,"width":749,"height":12}},{"id":"d7fac85e-70f2-4270-9caf-62f6d3fa5483","block_type":"box","text":"higher rate of return to attract investors who are willing to defer receipt of cash.","page_number":187,"box":{"x":117,"y":661,"width":583,"height":12}},{"id":"c8969a06-a1c4-46e8-89f8-0246036d5a69","block_type":"box","text":"A Fund accrues income with respect to these securities for U.S. federal income tax and accounting","page_number":187,"box":{"x":116,"y":692,"width":733,"height":12}},{"id":"625e9030-3160-4941-a459-1454a68b341e","block_type":"box","text":"purposes prior to the receipt of cash payments. Zero coupon securities may be subject to greater","page_number":187,"box":{"x":117,"y":707,"width":720,"height":12}},{"id":"6130b07d-801a-45e6-892d-6d199ed889e5","block_type":"box","text":"fluctuation in value and less liquidity in the event of adverse market conditions than comparably rated","page_number":187,"box":{"x":116,"y":723,"width":750,"height":12}},{"id":"d405d104-d4b4-4107-8be7-b51687d2be76","block_type":"box","text":"securities that pay cash interest at regular intervals.","page_number":187,"box":{"x":116,"y":738,"width":382,"height":12}},{"id":"899daa81-03ad-4a49-b1a9-746575790786","block_type":"box","text":"Further, to maintain its qualification for pass-through treatment under the U.S. federal tax laws, a Fund","page_number":187,"box":{"x":117,"y":769,"width":759,"height":12}},{"id":"cfdac297-0466-4b8a-a675-28996f5e9a2b","block_type":"box","text":"is required to distribute income to its shareholders and, consequently, may have to dispose of other,","page_number":187,"box":{"x":117,"y":785,"width":740,"height":12}},{"id":"0c5afacc-875e-49d5-a722-065141e52dd2","block_type":"box","text":"more liquid portfolio securities under disadvantageous circumstances or may have to leverage itself by","page_number":187,"box":{"x":117,"y":800,"width":760,"height":12}},{"id":"87135553-bd62-4c39-8dc9-ab52e16f8b84","block_type":"box","text":"borrowing in order to generate the cash to satisfy these distributions. The required distributions may","page_number":187,"box":{"x":117,"y":816,"width":740,"height":12}},{"id":"c02e8963-2ca8-4bac-b219-8ca2a5d6dcf2","block_type":"box","text":"result in an increase in a Fund’s exposure to zero coupon securities.","page_number":187,"box":{"x":117,"y":831,"width":511,"height":12}},{"id":"4fb7394b-2d2b-467d-bdbb-ab731ab15ebc","block_type":"box","text":"In addition to the above-described risks, there are certain other risks related to investing in zero","page_number":187,"box":{"x":117,"y":862,"width":712,"height":12}},{"id":"f40f7f77-6e62-4b15-b950-700d492ebfe5","block_type":"box","text":"coupon securities. During a period of severe market conditions, the market for such securities may","page_number":187,"box":{"x":116,"y":878,"width":736,"height":12}},{"id":"4d757582-fee4-4bd4-aa83-ec3c8198d3b4","block_type":"box","text":"II-103","page_number":187,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"83f45afa-d241-45af-bffc-71cd3730122a","block_type":"box","text":"NM0926U-5926888-187/257","page_number":187,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"53cb980a-0016-4a23-8af9-75476a062814","block_type":"box","text":"become even less liquid. In addition, as these securities do not pay cash interest, a Fund’s investment","page_number":188,"box":{"x":117,"y":87,"width":762,"height":12}},{"id":"06cbf5fd-ee9d-48f4-b917-2433fe657852","block_type":"box","text":"exposure to these securities and their risks, including credit risk, will increase during the time these","page_number":188,"box":{"x":116,"y":103,"width":739,"height":12}},{"id":"b0f9627d-061d-4f92-b70e-b9e4a1e59fb2","block_type":"box","text":"securities are held in the Fund’s portfolio.","page_number":188,"box":{"x":116,"y":118,"width":311,"height":12}},{"id":"1f349dd5-9da0-44ef-b704-7c53d2cb0b49","block_type":"box","text":"Suitability. (All Funds)","page_number":188,"box":{"x":117,"y":149,"width":181,"height":12}},{"id":"7bbf9f91-3925-40a9-9a70-4e0729ac84bb","block_type":"box","text":"The economic benefit of an investment in any Fund depends upon many factors beyond the control of","page_number":188,"box":{"x":116,"y":172,"width":760,"height":12}},{"id":"2a574286-a5f8-4f0a-8335-ec98947c6215","block_type":"box","text":"the Fund, the Manager and its affiliates. Each Fund should be considered a vehicle for diversification","page_number":188,"box":{"x":116,"y":188,"width":753,"height":12}},{"id":"9130750a-a231-4954-b912-c86bd9919dc5","block_type":"box","text":"and not as a balanced investment program. The suitability for any particular investor of a purchase of","page_number":188,"box":{"x":116,"y":203,"width":755,"height":12}},{"id":"0d3c9833-a5cb-4afe-9bca-2aff1457bf56","block_type":"box","text":"shares in a Fund will depend upon, among other things, such investor’s investment objectives and","page_number":188,"box":{"x":116,"y":219,"width":733,"height":12}},{"id":"2650e042-f798-43a7-b737-28062f4a6561","block_type":"box","text":"such investor’s ability to accept the risks associated with investing in securities, including the risk of","page_number":188,"box":{"x":116,"y":234,"width":741,"height":12}},{"id":"d7c9430e-efaf-4751-93de-05c66dfac0f8","block_type":"box","text":"loss of principal.","page_number":188,"box":{"x":117,"y":250,"width":124,"height":12}},{"id":"3d246dae-fc71-4580-aabf-7e933b3501bc","block_type":"box","text":"Investment Restrictions. (All Funds)","page_number":188,"box":{"x":116,"y":281,"width":293,"height":12}},{"id":"1e5b96a6-b579-4235-86b0-fd7caab8e6cb","block_type":"box","text":"See “Investment Restrictions” or “Investment Policies,” as applicable in each Fund’s SAI for the","page_number":188,"box":{"x":116,"y":304,"width":712,"height":12}},{"id":"1d0f9d92-2316-483c-b93e-73c9179cdbb2","block_type":"box","text":"specific fundamental and non-fundamental investment restrictions adopted by each Fund. In addition to","page_number":188,"box":{"x":116,"y":320,"width":772,"height":12}},{"id":"81f5443f-b8cc-4646-9cf8-9a6979e6663e","block_type":"box","text":"those investment restrictions, each Fund is also subject to the restrictions discussed below.","page_number":188,"box":{"x":116,"y":335,"width":683,"height":12}},{"id":"8934ccb7-8d14-4c98-80d3-e9585f8b0ada","block_type":"box","text":"Each Fund’s investments will be limited in order to","page_number":188,"box":{"x":117,"y":366,"width":376,"height":10}},{"id":"fc62e8d0-89af-4bbd-a09f-d7b859e72565","block_type":"box","text":"allow the Fund to qualify as a “regulated investment","page_number":188,"box":{"x":494,"y":366,"width":389,"height":12}},{"id":"72939c6f-014f-4964-9776-7dec524cda9a","block_type":"box","text":"company” for purposes of the Code. See “Dividends and Taxes — Taxes” or “Taxes.” To qualify,","page_number":188,"box":{"x":116,"y":382,"width":721,"height":12}},{"id":"db17dd21-ecf7-4ac1-a441-403ad80814b2","block_type":"box","text":"among other requirements, each Fund will limit its investments so that, at the close of each quarter of","page_number":188,"box":{"x":116,"y":397,"width":757,"height":12}},{"id":"78f9bdbf-ae3a-4391-954b-4ba8387f7e46","block_type":"box","text":"the taxable year, (i) at least 50% of the market value of each Fund’s assets is represented by cash,","page_number":188,"box":{"x":116,"y":413,"width":741,"height":12}},{"id":"101489e9-6b51-4e40-adaf-a3c37b6755e3","block_type":"box","text":"securities of other regulated investment companies, U.S. Government Securities and other securities,","page_number":188,"box":{"x":116,"y":428,"width":759,"height":12}},{"id":"4fb721f3-8589-41ad-9ba5-4fc7795d78a2","block_type":"box","text":"with such other securities limited, in respect of any one issuer, to an amount not greater in value than","page_number":188,"box":{"x":116,"y":444,"width":756,"height":12}},{"id":"18088ba7-f03a-4cb3-9832-9a51adb8fc04","block_type":"box","text":"5% of the Fund’s assets and not greater than 10% of the outstanding voting securities of such issuer","page_number":188,"box":{"x":116,"y":459,"width":751,"height":12}},{"id":"22e94bcf-0beb-479d-a05b-cdd8c4fa9b48","block_type":"box","text":"and (ii) not more than 25% of the value of its assets is invested in the securities (other than U.S.","page_number":188,"box":{"x":116,"y":475,"width":718,"height":12}},{"id":"c945bb06-f373-424c-b264-41ae3ad6bcc9","block_type":"box","text":"Government Securities or securities of other regulated investment companies) of any one issuer, any","page_number":188,"box":{"x":117,"y":490,"width":754,"height":12}},{"id":"99ed3997-86fb-4a83-95b0-993030a3e26f","block_type":"box","text":"two or more issuers that the Fund controls and that are determined to be engaged in the same or","page_number":188,"box":{"x":116,"y":506,"width":726,"height":12}},{"id":"0522d6cf-a75e-4d8a-9d01-967bc6a740ed","block_type":"box","text":"similar trades or businesses or related trades or businesses or in the securities of one or more qualified","page_number":188,"box":{"x":116,"y":521,"width":772,"height":12}},{"id":"fb30dab0-6925-42ea-9b47-e48e7666723a","block_type":"box","text":"publicly traded partnerships (","page_number":188,"box":{"x":117,"y":537,"width":214,"height":12}},{"id":"733d1c33-1c42-40f1-a50e-e2b42c913b66","block_type":"box","text":"i.e.","page_number":188,"box":{"x":332,"y":537,"width":21,"height":9}},{"id":"c8585e43-5b49-4ce7-8995-bfcc2ac69ebe","block_type":"box","text":", partnerships that are traded on an established securities market or","page_number":188,"box":{"x":356,"y":537,"width":507,"height":12}},{"id":"0958fb2d-22c8-4248-ac4c-c763d9427230","block_type":"box","text":"tradable on a secondary market, other than partnerships that derive 90% of their income from interest,","page_number":188,"box":{"x":116,"y":552,"width":764,"height":12}},{"id":"e40a2695-3b63-4312-a3c0-793d166e846b","block_type":"box","text":"dividends, capital gains and other traditionally permitted mutual fund income). For purposes of this","page_number":188,"box":{"x":116,"y":568,"width":734,"height":12}},{"id":"139a1b52-c7b3-4c67-a920-3acd34f19a1f","block_type":"box","text":"restriction, the Municipal Funds generally will regard each state and each of its political subdivisions,","page_number":188,"box":{"x":117,"y":583,"width":749,"height":12}},{"id":"6642faa7-e6a6-4ea0-9d98-a7e835afa20b","block_type":"box","text":"agencies or instrumentalities and each multi-state agency of which the state is a member as a","page_number":188,"box":{"x":116,"y":599,"width":703,"height":12}},{"id":"30f2ae69-db24-4e8b-b902-384dc869c8da","block_type":"box","text":"separate issuer. Each public authority that issues securities on behalf of a private entity generally will","page_number":188,"box":{"x":116,"y":614,"width":754,"height":12}},{"id":"f5bd0840-f860-45d6-b0e8-0d08a0aa1795","block_type":"box","text":"also be regarded as a separate issuer, except that if the security is backed only by the assets and","page_number":188,"box":{"x":116,"y":630,"width":731,"height":12}},{"id":"16cb004d-70b8-4f50-88b8-ba7079a63e59","block_type":"box","text":"revenues of a non-government entity, then the entity with the ultimate responsibility for the payment of","page_number":188,"box":{"x":117,"y":645,"width":762,"height":12}},{"id":"cc95a0bb-6af0-4229-9e46-4b9e5ac249f0","block_type":"box","text":"interest and principal may be regarded as the sole issuer.","page_number":188,"box":{"x":117,"y":661,"width":425,"height":12}},{"id":"53a7027a-a90b-47f4-9ba9-f77b31cdde1f","block_type":"box","text":"Foreign government securities (unlike U.S. Government Securities) are not exempt from the 5%, 10%","page_number":188,"box":{"x":117,"y":692,"width":753,"height":12}},{"id":"1366c213-9bcb-4987-b695-41da8beba0ff","block_type":"box","text":"and 25% diversification requirements of the Code discussed above and the securities of each foreign","page_number":188,"box":{"x":116,"y":707,"width":749,"height":12}},{"id":"b18d388f-55c5-4868-84dc-72ef055ec3b8","block_type":"box","text":"government issuer are considered to be obligations of a single issuer. These tax-related limitations","page_number":188,"box":{"x":116,"y":723,"width":732,"height":12}},{"id":"3c0e5e4d-c20d-4dc3-8f8a-caee425d5983","block_type":"box","text":"may be changed by the Directors of a Fund to the extent necessary to comply with changes to the U.S.","page_number":188,"box":{"x":117,"y":738,"width":763,"height":12}},{"id":"dc074bf1-e349-4de9-addf-999c5e60669b","block_type":"box","text":"federal tax requirements. A Fund that is “diversified” under the Investment Company Act must satisfy","page_number":188,"box":{"x":116,"y":754,"width":748,"height":12}},{"id":"0bfa4868-4a76-4974-9270-3012fa0cfa24","block_type":"box","text":"the foregoing 5% and 10% requirements with respect to 75% of its total assets.","page_number":188,"box":{"x":116,"y":769,"width":586,"height":12}},{"id":"418c8a5d-3408-47ac-9da7-a431b9054fa2","block_type":"box","text":"II-104","page_number":188,"box":{"x":480,"y":909,"width":40,"height":9}},{"id":"a50c7f1c-1041-44c7-9435-038f4488831d","block_type":"box","text":"NM0926U-5926888-188/257","page_number":188,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"4019a4cd-e9d6-480e-8430-1ca6f7e762ab","block_type":"box","text":"APPENDIX A","page_number":189,"box":{"x":448,"y":87,"width":108,"height":9}},{"id":"aed3dfee-d1e2-4fd1-99c4-b5e62cc6052f","block_type":"box","text":"Description of Bond Ratings","page_number":189,"box":{"x":387,"y":117,"width":231,"height":12}},{"id":"5a154a7a-60ea-40ec-a70b-3ac47029600a","block_type":"box","text":"A rating is generally assigned to a fixed-income security at the time of issuance by a credit rating","page_number":189,"box":{"x":116,"y":154,"width":722,"height":12}},{"id":"ae0a9b83-51f8-4edf-ac68-2f56b972203f","block_type":"box","text":"agency designated as a nationally recognized statistical rating organization (“NRSRO”) by the","page_number":189,"box":{"x":116,"y":170,"width":700,"height":12}},{"id":"eea6b480-38ff-4c2d-afe8-0aac027e7c9a","block_type":"box","text":"Securities and Exchange Commission (“SEC”). While NRSROs may from time to time revise such","page_number":189,"box":{"x":116,"y":185,"width":731,"height":12}},{"id":"2cf7adcd-9aa0-4838-8a44-aad837d49e0a","block_type":"box","text":"ratings, they undertake no obligation to do so, and the ratings given to securities at issuance do not","page_number":189,"box":{"x":117,"y":201,"width":741,"height":12}},{"id":"45274892-d2b1-44f7-a77a-2a366046f44d","block_type":"box","text":"necessarily represent ratings which would be given to these securities on a particular subsequent date.","page_number":189,"box":{"x":117,"y":216,"width":769,"height":12}},{"id":"b8cc0737-e3a1-407c-9648-c303c9c2bfd7","block_type":"box","text":"NRSROs may rate specific investments (e.g., bonds), issuers (e.g., corporations, governments and","page_number":189,"box":{"x":117,"y":246,"width":740,"height":12}},{"id":"eaf62ca8-ba30-484e-bd6c-d500084a4b39","block_type":"box","text":"financial institutions) and/or programs (e.g., commercial paper programs). However, certain types of","page_number":189,"box":{"x":116,"y":261,"width":747,"height":13}},{"id":"636b65fb-7be3-40b7-a7f2-9bb0a8556337","block_type":"box","text":"investments may not be rated by NRSROs, such as certain government/sovereign obligations, US","page_number":189,"box":{"x":117,"y":277,"width":732,"height":12}},{"id":"c5014860-f3c5-4e6c-a199-b17162ba9a07","block_type":"box","text":"agency securities, commercial paper, time deposits at financial institutions, and derivative instruments","page_number":189,"box":{"x":116,"y":292,"width":761,"height":13}},{"id":"cfb87ef8-ce13-4d78-bc63-0caef66dbe79","block_type":"box","text":"such as credit default swaps. For these types of investments, as well as US Treasury securities (some","page_number":189,"box":{"x":116,"y":308,"width":764,"height":12}},{"id":"4aa1b312-efb1-4060-98f0-549d436f8ecd","block_type":"box","text":"of which are not rated), where an NRSRO has not rated the specific investment but has rated the","page_number":189,"box":{"x":116,"y":323,"width":725,"height":13}},{"id":"7eaf2b2b-86db-4a79-a457-46a486be6d13","block_type":"box","text":"investment’s issuer, program, financial institution or underlying reference asset, BlackRock Advisors,","page_number":189,"box":{"x":117,"y":339,"width":751,"height":12}},{"id":"632adf04-8b35-4bc3-bf98-4991fc935db7","block_type":"box","text":"LLC, BlackRock Fund Advisors or their respective affiliates (“BlackRock”) may consider the investment","page_number":189,"box":{"x":117,"y":355,"width":766,"height":12}},{"id":"5c5c374f-f575-4b79-9c0d-7b7646872fc5","block_type":"box","text":"to have the same NRSRO rating as its issuer, program, financial institution or underlying reference","page_number":189,"box":{"x":116,"y":370,"width":736,"height":12}},{"id":"403aab9b-e556-420e-a7b4-23475e8970b6","block_type":"box","text":"asset, as applicable. In the case of municipal securities, where one NRSRO provides multiple ratings","page_number":189,"box":{"x":116,"y":386,"width":754,"height":12}},{"id":"d4e64310-7300-4a70-b675-d3cc25adea7e","block_type":"box","text":"for the same security (e.g., “underlying,” “insured” and/or “enhanced” ratings), BlackRock may consider","page_number":189,"box":{"x":116,"y":401,"width":770,"height":12}},{"id":"74047dbc-6346-469a-9a2f-e9329aa1125f","block_type":"box","text":"the security to have the highest of the multiple ratings.","page_number":189,"box":{"x":116,"y":417,"width":407,"height":12}},{"id":"39853a23-1116-4347-b5f8-7ce9f62af215","block_type":"box","text":"New issue securities (regardless of type) may not be rated by an NRSRO at the time of their initial","page_number":189,"box":{"x":117,"y":446,"width":732,"height":13}},{"id":"b66642b4-cf38-4628-bde0-e95f50cd1d11","block_type":"box","text":"offering. Preliminary prospectuses or term sheets for new issue securities may include an expected","page_number":189,"box":{"x":116,"y":462,"width":742,"height":12}},{"id":"6a9be1a1-58fe-4dc0-a721-290e7d258f44","block_type":"box","text":"rating for the security (as determined by the underwriter and/or issuer) or an NRSRO rating for the","page_number":189,"box":{"x":117,"y":477,"width":733,"height":13}},{"id":"f723939a-f458-4961-b350-e6611bbe61e8","block_type":"box","text":"issuer of the security. If applicable, when deciding whether to purchase a new issue security that has","page_number":189,"box":{"x":117,"y":493,"width":752,"height":12}},{"id":"76d41ba7-c38d-44f0-bdfe-ee4ef4ff849e","block_type":"box","text":"not yet been rated by an NRSRO, BlackRock may attribute an expected rating to the security based","page_number":189,"box":{"x":117,"y":508,"width":745,"height":13}},{"id":"740e919f-6cc3-4bcd-8707-6b7c28f8175d","block_type":"box","text":"on: (i) the expected rating of the security set forth in the preliminary prospectus or term sheet for the","page_number":189,"box":{"x":116,"y":524,"width":747,"height":12}},{"id":"126b5a34-d040-4b25-8f38-bdbbea2412e9","block_type":"box","text":"security; (ii) the NRSRO’s rating for the issuer of the security set forth in the preliminary prospectus or","page_number":189,"box":{"x":116,"y":539,"width":760,"height":13}},{"id":"881924bc-1ef2-4ab2-b46d-cf5ff353992c","block_type":"box","text":"term sheet for the security; or (iii) with respect to asset-backed securities, the rating of a prior issuance","page_number":189,"box":{"x":116,"y":555,"width":767,"height":12}},{"id":"b9f75a12-a765-4a64-b9d9-d9189c791f88","block_type":"box","text":"having a similar structure or the same sponsor.","page_number":189,"box":{"x":117,"y":571,"width":353,"height":12}},{"id":"072f14c3-ffe7-4fd7-9dfc-9a31dcbfb8a3","block_type":"box","text":"Where the investment objective of a fund is to track the performance of an index that includes credit","page_number":189,"box":{"x":116,"y":600,"width":746,"height":12}},{"id":"9441939a-31b9-4697-9b80-c19ceacf2e4b","block_type":"box","text":"ratings eligibility criteria as part of its index methodology, the fund may purchase any security within the","page_number":189,"box":{"x":117,"y":616,"width":771,"height":12}},{"id":"d3884a9f-d687-45d4-9c50-6d498b2a6ee0","block_type":"box","text":"index, such security having been determined by the index provider as meeting its credit ratings","page_number":189,"box":{"x":117,"y":632,"width":707,"height":11}},{"id":"0ba7a8fd-0c4b-4a2b-8b46-15bfbb9fb68b","block_type":"box","text":"eligibility criteria. The credit ratings practices of an index provider may differ from BlackRock’s","page_number":189,"box":{"x":116,"y":647,"width":701,"height":12}},{"id":"6d916e05-8e67-4895-bf1f-6db6f622804d","block_type":"box","text":"practices, as described above. Further, the fund may invest, directly or indirectly, in securities that are","page_number":189,"box":{"x":117,"y":662,"width":754,"height":12}},{"id":"27b683e2-40f1-4bfc-a834-8f09f43ff870","block_type":"box","text":"not rated by a rating agency or securities with a credit rating that differs from the credit rating specified","page_number":189,"box":{"x":117,"y":678,"width":757,"height":12}},{"id":"15335cd7-8e08-485b-ab98-a798e862c496","block_type":"box","text":"in its index methodology in various circumstances, including where a security is downgraded but not","page_number":189,"box":{"x":117,"y":694,"width":741,"height":11}},{"id":"2072a867-7146-48ec-a8fb-8e69c50213ff","block_type":"box","text":"yet removed from an index, following the removal of a security from an index prior to its sale by the","page_number":189,"box":{"x":116,"y":709,"width":733,"height":12}},{"id":"ac6047e8-a5d1-4f88-a120-afeb5c3f6a0d","block_type":"box","text":"fund or as a result of a corporate action or restructuring affecting an issuer of a security held by the","page_number":189,"box":{"x":116,"y":724,"width":734,"height":13}},{"id":"73af1855-ec5b-42fe-ae19-4a9a631f78ff","block_type":"box","text":"fund.","page_number":189,"box":{"x":116,"y":740,"width":36,"height":9}},{"id":"587726f4-98ac-4978-8336-39b289ae39fa","block_type":"box","text":"Fixed-income securities which are unrated may expose the investor to risks with respect to capacity to","page_number":189,"box":{"x":117,"y":770,"width":757,"height":12}},{"id":"a81f6d4f-faf7-49e8-9186-deaa69f55c83","block_type":"box","text":"pay interest or repay principal which are similar to the risks of lower-rated speculative bonds (although","page_number":189,"box":{"x":117,"y":785,"width":756,"height":12}},{"id":"d9145d28-e887-457d-a7ff-34f79aa86225","block_type":"box","text":"BlackRock may deem such unrated securities to be of higher quality). Evaluation of these securities is","page_number":189,"box":{"x":117,"y":801,"width":755,"height":12}},{"id":"8f8fed1d-654a-4b66-b6ce-3a7eece6b334","block_type":"box","text":"dependent on BlackRock’s judgment, analysis and experience in the evaluation of such securities.","page_number":189,"box":{"x":116,"y":816,"width":728,"height":12}},{"id":"b68edfd9-df7b-460b-a411-2da0dc9176a8","block_type":"box","text":"Investors should note that the assignment of a rating to a security by an NRSRO may not reflect the","page_number":189,"box":{"x":117,"y":846,"width":745,"height":12}},{"id":"4232dd95-8b76-4b30-bbb0-beba40f07f8b","block_type":"box","text":"effect of recent developments on the issuer’s ability to make interest and principal payments or on the","page_number":189,"box":{"x":116,"y":862,"width":760,"height":12}},{"id":"c81bb162-bb01-4ec3-ab31-36e6de50d7a1","block_type":"box","text":"likelihood of default.","page_number":189,"box":{"x":117,"y":877,"width":152,"height":10}},{"id":"83c406e6-b009-4623-b01e-006033f0e420","block_type":"box","text":"A-1","page_number":189,"box":{"x":486,"y":909,"width":24,"height":9}},{"id":"6030d445-3f33-4938-b1ca-0b8d8b35f9f3","block_type":"box","text":"NM0926U-5926888-189/257","page_number":189,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"4dafc5be-bdf1-4939-8705-b7cb18ccc6bc","block_type":"box","text":"Securities deemed to be high yield are rated below Baa3 by Moody’s and below BBB- by S&P Global","page_number":190,"box":{"x":116,"y":87,"width":755,"height":12}},{"id":"3d73d548-2941-48e6-91af-f8ad7ba43553","block_type":"box","text":"Ratings and Fitch. Other terms used to describe such securities include “lower rated bonds,” “non","page_number":190,"box":{"x":117,"y":102,"width":728,"height":13}},{"id":"907d5787-5907-4206-99df-22d50d15a65b","block_type":"box","text":"investment grade bonds,” “below investment grade bonds,” and “junk bonds.”","page_number":190,"box":{"x":117,"y":118,"width":577,"height":12}},{"id":"d25feaab-ed4c-45d4-a645-07fb85fcfc7a","block_type":"box","text":"The descriptions below relate to general long-term and short-term obligations of an issuer.","page_number":190,"box":{"x":116,"y":148,"width":674,"height":12}},{"id":"8801c905-2173-420c-b813-d0bcadb5db96","block_type":"box","text":"A Description of Moody’s Investors Service, Inc.’s (“Moody’s”) Global Rating Scales","page_number":190,"box":{"x":116,"y":177,"width":677,"height":12}},{"id":"56553030-88f9-486a-85e1-567d0cd1f1d2","block_type":"box","text":"Credit ratings are assigned on Moody’s global long-term and short-term rating scales and are forward","page_number":190,"box":{"x":117,"y":207,"width":757,"height":12}},{"id":"69b39355-edbe-4cfb-b86f-2e48703c6e9c","block_type":"box","text":"looking opinions of the relative credit risks of financial obligations issued by non-financial corporates,","page_number":190,"box":{"x":117,"y":222,"width":750,"height":13}},{"id":"61f9f592-7494-4fd6-8052-f57d26249965","block_type":"box","text":"financial institutions, structured finance vehicles, project finance vehicles, and public sector entities.","page_number":190,"box":{"x":116,"y":238,"width":742,"height":12}},{"id":"85d8f39d-5f3b-435f-af4f-329323b78a0e","block_type":"box","text":"Moody’s defines credit risk as the risk that an entity may not meet its contractual financial obligations","page_number":190,"box":{"x":117,"y":253,"width":751,"height":13}},{"id":"5997ff73-8aba-4d99-8881-de8aa52c45c6","block_type":"box","text":"as they come due and any estimated financial loss in the event of default or impairment. The","page_number":190,"box":{"x":116,"y":269,"width":692,"height":12}},{"id":"776482aa-56b4-4c88-831c-cb12eaf93519","block_type":"box","text":"contractual financial obligations addressed by Moody’s ratings are those that call for, without regard to","page_number":190,"box":{"x":116,"y":284,"width":763,"height":13}},{"id":"4face9b7-7990-4510-b84f-c315f4a4d13e","block_type":"box","text":"enforceability, the payment of an ascertainable amount, which may vary based upon standard sources","page_number":190,"box":{"x":116,"y":300,"width":765,"height":12}},{"id":"5e1f2953-082b-4b69-b9b1-ec188dec31f7","block_type":"box","text":"of variation (e.g., floating interest rates), by an ascertainable date. Moody’s rating addresses the","page_number":190,"box":{"x":116,"y":315,"width":719,"height":13}},{"id":"45c75e03-03ba-4df5-bf85-9facc21edb38","block_type":"box","text":"issuer’s ability to obtain cash sufficient to service the obligation, and its willingness to pay. Moody’s","page_number":190,"box":{"x":117,"y":331,"width":738,"height":12}},{"id":"450529b5-8c54-4d59-918c-7ba034fe0883","block_type":"box","text":"ratings do not address non-standard sources of variation in the amount of the principal obligation (e.g.,","page_number":190,"box":{"x":117,"y":346,"width":765,"height":13}},{"id":"b818ee7f-fa99-4ad4-8062-fbd08ca1162d","block_type":"box","text":"equity indexed), absent an express statement to the contrary in a press release accompanying an","page_number":190,"box":{"x":116,"y":362,"width":731,"height":12}},{"id":"40791961-58fd-42d8-834e-1fc609bcbcce","block_type":"box","text":"initial rating. Long-term ratings are assigned to issuers or obligations with an original maturity of eleven","page_number":190,"box":{"x":117,"y":377,"width":767,"height":13}},{"id":"0157f28e-43fd-4fdd-8a42-d93d6ea94fda","block_type":"box","text":"months or more and reflect both on the likelihood of a default or impairment on contractual financial","page_number":190,"box":{"x":117,"y":393,"width":741,"height":12}},{"id":"7dec66f0-5a46-4cf9-8eba-e9004a603ab3","block_type":"box","text":"obligations and the expected financial loss suffered in the event of default or impairment. Short-term","page_number":190,"box":{"x":116,"y":409,"width":747,"height":12}},{"id":"911d1e59-ce96-4f7c-bd78-a76cecebfd40","block_type":"box","text":"ratings are assigned for obligations with an original maturity of thirteen months or less and reflect both","page_number":190,"box":{"x":117,"y":424,"width":760,"height":12}},{"id":"8de2c5a3-36cb-4610-b833-6634bfb672f0","block_type":"box","text":"on the likelihood of a default or impairment on contractual financial obligations and the expected","page_number":190,"box":{"x":116,"y":440,"width":717,"height":12}},{"id":"7cffab5a-7fdc-48ea-a761-c961eb3126e2","block_type":"box","text":"financial loss suffered in the event of default or impairment. Moody’s issues ratings at the issuer level","page_number":190,"box":{"x":116,"y":455,"width":755,"height":12}},{"id":"6b0401aa-f2d7-4d7c-b943-436042add38c","block_type":"box","text":"and instrument level on both the long-term scale and the short-term scale. Typically, ratings are made","page_number":190,"box":{"x":116,"y":471,"width":761,"height":12}},{"id":"24e6c9d7-920c-46e5-aba9-720a04a27120","block_type":"box","text":"publicly available although private and unpublished ratings may also be assigned.","page_number":190,"box":{"x":117,"y":486,"width":610,"height":12}},{"id":"9fddab1f-6298-4054-a2ee-517b01d336af","block_type":"box","text":"Moody’s differentiates structured finance ratings from fundamental ratings (i.e., ratings on nonfinancial","page_number":190,"box":{"x":117,"y":516,"width":763,"height":12}},{"id":"811d492c-8862-44ae-930b-a7584eae4ff4","block_type":"box","text":"corporate, financial institution, and public sector entities) on the global long-term scale by adding (sf) to","page_number":190,"box":{"x":116,"y":531,"width":769,"height":12}},{"id":"8fd5c3db-22b5-4bff-ac48-032fc4c33677","block_type":"box","text":"all structured finance ratings. The addition of (sf) to structured finance ratings should eliminate any","page_number":190,"box":{"x":116,"y":547,"width":735,"height":12}},{"id":"7e53809a-088c-4d6d-b449-46a2778b6bbd","block_type":"box","text":"presumption that such ratings and fundamental ratings at the same letter grade level will behave the","page_number":190,"box":{"x":117,"y":562,"width":747,"height":12}},{"id":"26be6183-a0bc-413e-acb5-78905c8efd81","block_type":"box","text":"same. The (sf) indicator for structured finance security ratings indicates that otherwise similarly rated","page_number":190,"box":{"x":116,"y":578,"width":751,"height":12}},{"id":"0533d793-f182-4683-aaf4-b751bb9838e4","block_type":"box","text":"structured finance and fundamental securities may have different risk characteristics. Through its","page_number":190,"box":{"x":116,"y":593,"width":724,"height":12}},{"id":"901a45fb-1a0c-43f8-ab51-96ed3504888c","block_type":"box","text":"current methodologies, however, Moody’s aspires to achieve broad expected equivalence in structured","page_number":190,"box":{"x":116,"y":609,"width":769,"height":12}},{"id":"35d18e00-f03d-414d-a8ad-c359a5337bcf","block_type":"box","text":"finance and fundamental rating performance when measured over a long period of time.","page_number":190,"box":{"x":116,"y":624,"width":658,"height":12}},{"id":"271e7e8b-4f06-4f17-97ad-c9e362b49235","block_type":"box","text":"Description of Moody’s Global Long-Term Rating Scale","page_number":190,"box":{"x":117,"y":654,"width":445,"height":12}},{"id":"4cf59acb-0e36-4a8d-8b27-d113ed6fd9ed","block_type":"box","text":"Aaa Obligations rated Aaa are judged to be of the highest quality, subject to the lowest level","page_number":190,"box":{"x":116,"y":684,"width":756,"height":12}},{"id":"6b964265-53f6-4ab8-995c-cf86485bef51","block_type":"box","text":"of credit risk.","page_number":190,"box":{"x":226,"y":699,"width":93,"height":10}},{"id":"9e2b69b7-562e-449a-9687-50a08b4cb7eb","block_type":"box","text":"Aa Obligations rated Aa are judged to be of high quality and are subject to very low credit","page_number":190,"box":{"x":116,"y":722,"width":747,"height":12}},{"id":"93225f81-7075-4565-8724-7f77059c23e1","block_type":"box","text":"risk.","page_number":190,"box":{"x":226,"y":738,"width":28,"height":9}},{"id":"db19764e-55ba-47c9-91a9-cb14719c04b9","block_type":"box","text":"A Obligations rated A are judged to be upper-medium grade and are subject to low credit","page_number":190,"box":{"x":116,"y":761,"width":754,"height":12}},{"id":"0de7a5b0-e652-436c-8508-f90704c3069c","block_type":"box","text":"risk.","page_number":190,"box":{"x":226,"y":777,"width":28,"height":9}},{"id":"bec54673-9f4c-49e4-b6ca-9711f3db3f6a","block_type":"box","text":"Baa Obligations rated Baa are judged to be medium-grade and subject to moderate credit","page_number":190,"box":{"x":117,"y":800,"width":741,"height":12}},{"id":"1e2b5787-4f54-4455-94b2-01ed3d6005be","block_type":"box","text":"risk and as such may possess certain speculative characteristics.","page_number":190,"box":{"x":226,"y":815,"width":483,"height":12}},{"id":"9de6338d-7f95-4076-8f94-8cc43530a798","block_type":"box","text":"Ba Obligations rated Ba are judged to be speculative and are subject to substantial credit","page_number":190,"box":{"x":117,"y":839,"width":750,"height":12}},{"id":"5cb48171-9df2-492b-90c1-e17b750a9970","block_type":"box","text":"risk.","page_number":190,"box":{"x":226,"y":854,"width":35,"height":10}},{"id":"7f3329c0-5287-48bc-8b3d-af8439d3e693","block_type":"box","text":"B Obligations rated B are considered speculative and are subject to high credit risk.","page_number":190,"box":{"x":117,"y":877,"width":717,"height":12}},{"id":"e964cda8-aab0-49cb-8911-1f7a62cf00fb","block_type":"box","text":"A-2","page_number":190,"box":{"x":486,"y":909,"width":26,"height":9}},{"id":"aff08f96-6811-425e-b3be-a3422f47a2df","block_type":"box","text":"NM0926U-5926888-190/257","page_number":190,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"18e41f48-3e31-4348-8043-884f3a818b0d","block_type":"box","text":"Caa Obligations rated Caa are judged to be speculative of poor standing and are subject to","page_number":191,"box":{"x":117,"y":87,"width":755,"height":12}},{"id":"2cf6c098-63f9-4309-8032-fea25809627a","block_type":"box","text":"very high credit risk.","page_number":191,"box":{"x":225,"y":103,"width":154,"height":12}},{"id":"788343bd-5af3-40b6-909e-9b26bd707d19","block_type":"box","text":"Ca Obligations rated Ca are highly speculative and are likely in, or very near, default, with","page_number":191,"box":{"x":117,"y":126,"width":753,"height":12}},{"id":"425e0b16-542a-4d91-8686-94e66ae461b9","block_type":"box","text":"some prospect of recovery of principal and interest.","page_number":191,"box":{"x":226,"y":141,"width":386,"height":12}},{"id":"49b3c8e6-a0e2-4470-b766-64f23dc1d122","block_type":"box","text":"C Obligations rated C are the lowest rated and are typically in default, with little prospect","page_number":191,"box":{"x":117,"y":165,"width":752,"height":12}},{"id":"537c9b79-0c0e-4cae-8ffe-ef786c0cc10f","block_type":"box","text":"for recovery of principal or interest.","page_number":191,"box":{"x":225,"y":180,"width":264,"height":12}},{"id":"f32c5df9-7d8f-4949-b2c9-4fedbbcffe1e","block_type":"box","text":"Note:","page_number":191,"box":{"x":117,"y":210,"width":39,"height":9}},{"id":"84ccf700-6b10-4a19-ba15-a513dde53d40","block_type":"box","text":"Moody’s appends numerical modifiers 1, 2, and 3 to each generic rating classification from Aa","page_number":191,"box":{"x":156,"y":210,"width":706,"height":12}},{"id":"5f9614ad-3fc3-40ee-93d4-29364338bfd0","block_type":"box","text":"through Caa. The modifier 1 indicates that the obligation ranks in the higher end of its generic rating","page_number":191,"box":{"x":116,"y":225,"width":745,"height":12}},{"id":"61fd25c3-cd70-4336-821b-0ceab4652bf8","block_type":"box","text":"category; the modifier 2 indicates a mid-range ranking; and the modifier 3 indicates a ranking in the","page_number":191,"box":{"x":116,"y":241,"width":741,"height":12}},{"id":"fe3af3ea-359f-44ea-b33f-75b09a711b3e","block_type":"box","text":"lower end of that generic rating category. Additionally, a “(hyb)” indicator is appended to all ratings of","page_number":191,"box":{"x":117,"y":256,"width":751,"height":12}},{"id":"e57505ea-88d7-4cf0-89f4-74b983ba2696","block_type":"box","text":"hybrid securities issued by banks, insurers, finance companies, and securities firms.","page_number":191,"box":{"x":117,"y":272,"width":628,"height":12}},{"id":"05134398-48fa-44a1-8585-a2d79044ba56","block_type":"box","text":"By their terms, hybrid securities allow for the omission of scheduled dividends, interest, or principal","page_number":191,"box":{"x":117,"y":301,"width":737,"height":12}},{"id":"10055758-6e4a-4ced-af16-72b7d238410a","block_type":"box","text":"payments, which can potentially result in impairment if such an omission occurs. Hybrid securities may","page_number":191,"box":{"x":117,"y":317,"width":765,"height":12}},{"id":"c9de8f06-a24e-4331-951f-d0ab9b203400","block_type":"box","text":"also be subject to contractually allowable write-downs of principal that could result in impairment.","page_number":191,"box":{"x":116,"y":332,"width":724,"height":12}},{"id":"9771d706-7494-4e6e-8901-aca13aca66ad","block_type":"box","text":"Together with the hybrid indicator, the long-term obligation rating assigned to a hybrid security is an","page_number":191,"box":{"x":116,"y":348,"width":744,"height":12}},{"id":"32c03ef8-485e-42af-92db-05613ed738c8","block_type":"box","text":"expression of the relative credit risk associated with that security.","page_number":191,"box":{"x":116,"y":363,"width":488,"height":12}},{"id":"fa32a252-52fd-4c69-b94d-1885ae184461","block_type":"box","text":"Description of Moody’s Global Short-Term Rating Scale","page_number":191,"box":{"x":117,"y":393,"width":448,"height":12}},{"id":"2c9b8029-97ec-4021-8649-b7401ba5fdfa","block_type":"box","text":"P-1 Ratings of Prime-1 reflect a superior ability to repay short-term obligations.","page_number":191,"box":{"x":117,"y":422,"width":667,"height":13}},{"id":"d8b8faca-c65b-43bf-84fc-93a15173f323","block_type":"box","text":"P-2 Ratings of Prime-2 reflect a strong ability to repay short-term obligations.","page_number":191,"box":{"x":117,"y":446,"width":653,"height":12}},{"id":"cc63c581-1dc0-4ec0-b6ed-0e0c09c0ed64","block_type":"box","text":"P-3 Ratings of Prime-3 reflect an acceptable ability to repay short-term obligations.","page_number":191,"box":{"x":117,"y":469,"width":697,"height":12}},{"id":"2c2b5bb5-ecc8-4da1-a98a-5e29be2483ea","block_type":"box","text":"NP Issuers (or supporting institutions) rated Not Prime do not fall within any of the Prime","page_number":191,"box":{"x":117,"y":492,"width":741,"height":12}},{"id":"34567ca5-911d-49fc-a358-c7441f909166","block_type":"box","text":"rating categories.","page_number":191,"box":{"x":226,"y":508,"width":133,"height":12}},{"id":"6d60f122-f3f1-4521-9838-3a9d8963ae97","block_type":"box","text":"Description of Moody’s U.S. Municipal Short-Term Debt and Demand Obligation Ratings","page_number":191,"box":{"x":117,"y":537,"width":707,"height":12}},{"id":"45996835-5ff0-4233-b329-649f6bfc226d","block_type":"box","text":"Moody’s uses the global short-term Prime rating scale for commercial paper issued by U.S.","page_number":191,"box":{"x":117,"y":567,"width":681,"height":12}},{"id":"f8744f65-4a1e-4ff6-813e-239033c010af","block_type":"box","text":"municipalities and nonprofits. These commercial paper programs may be backed by external letters of","page_number":191,"box":{"x":117,"y":582,"width":761,"height":12}},{"id":"a25485ae-a61b-408e-a0c1-86d12e2c220d","block_type":"box","text":"credit or liquidity facilities, or by an issuer’s self-liquidity.","page_number":191,"box":{"x":116,"y":598,"width":420,"height":12}},{"id":"112818f6-5c05-4fd2-923e-e4c30d9cf540","block_type":"box","text":"For other short-term municipal obligations, Moody’s uses one of two other short-term rating scales, the","page_number":191,"box":{"x":117,"y":627,"width":765,"height":13}},{"id":"5b1ae948-5ab1-49c7-ba1b-0cea582645cf","block_type":"box","text":"Municipal Investment Grade (“MIG”) and Variable Municipal Investment Grade (“VMIG”) scales","page_number":191,"box":{"x":117,"y":643,"width":708,"height":12}},{"id":"e0c66509-d496-40ee-9fae-149082f785c2","block_type":"box","text":"discussed below.","page_number":191,"box":{"x":116,"y":659,"width":132,"height":9}},{"id":"5a2bc859-628c-414a-88fb-1f4cc2ffc7bb","block_type":"box","text":"MIG Ratings","page_number":191,"box":{"x":117,"y":688,"width":96,"height":12}},{"id":"a5ed3cb5-1931-4429-bc85-9848f360b714","block_type":"box","text":"Moody’s uses the MIG scale for U.S. municipal cash flow notes, bond anticipation notes and certain","page_number":191,"box":{"x":117,"y":718,"width":738,"height":12}},{"id":"2e6792ce-0d63-4966-a5e6-0bd6a233d86d","block_type":"box","text":"other short-term obligations, which typically mature in three years or less. Under certain circumstances,","page_number":191,"box":{"x":116,"y":733,"width":766,"height":12}},{"id":"9f21e190-b6ba-470b-ab7d-70740edd9055","block_type":"box","text":"Moody’s uses the MIG scale for bond anticipation notes with maturities of up to five years.","page_number":191,"box":{"x":117,"y":749,"width":665,"height":12}},{"id":"180cff0a-7988-4570-b671-b8ac68e5b6fd","block_type":"box","text":"MIG Scale","page_number":191,"box":{"x":117,"y":778,"width":77,"height":10}},{"id":"1075ca4a-ea0d-4c7e-ac20-e53639590792","block_type":"box","text":"MIG 1 This designation denotes superior credit quality. Excellent protection is afforded by","page_number":191,"box":{"x":117,"y":808,"width":722,"height":12}},{"id":"ddf832bb-20be-40db-a1fa-931dd14b1421","block_type":"box","text":"established cash flows, highly reliable liquidity support, or demonstrated broad-based","page_number":191,"box":{"x":226,"y":823,"width":631,"height":12}},{"id":"e850993d-733a-48ad-8a46-0a31e25a451f","block_type":"box","text":"access to the market for refinancing.","page_number":191,"box":{"x":226,"y":839,"width":275,"height":12}},{"id":"a08d4c5e-c43a-4096-9fd0-a57900ab69f1","block_type":"box","text":"MIG 2 This designation denotes strong credit quality. Margins of protection are ample, although","page_number":191,"box":{"x":117,"y":862,"width":771,"height":12}},{"id":"894ee51a-ab73-423f-9271-5a3dca31c89e","block_type":"box","text":"not as large as in the preceding group.","page_number":191,"box":{"x":226,"y":878,"width":291,"height":12}},{"id":"0f2eb8e4-a62a-49d1-9927-a9554fcf3256","block_type":"box","text":"A-3","page_number":191,"box":{"x":486,"y":909,"width":26,"height":9}},{"id":"a6c6da76-0459-4765-8698-ea5e8bb34a29","block_type":"box","text":"NM0926U-5926888-191/257","page_number":191,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"d736a7c0-983f-4c58-909d-a7c896aed659","block_type":"box","text":"MIG 3 This designation denotes acceptable credit quality. Liquidity and cash-flow protection","page_number":192,"box":{"x":117,"y":87,"width":743,"height":12}},{"id":"4ece183d-d575-441b-80fe-b14eaba99c48","block_type":"box","text":"may be narrow, and market access for refinancing is likely to be less well-established.","page_number":192,"box":{"x":226,"y":102,"width":642,"height":13}},{"id":"f22199ff-db60-4ac5-a507-45f980af6519","block_type":"box","text":"SG This designation denotes speculative-grade credit quality. Debt instruments in this","page_number":192,"box":{"x":116,"y":126,"width":723,"height":12}},{"id":"1f06490b-4ca0-4715-b367-134be29fd009","block_type":"box","text":"category may lack sufficient margins of protection.","page_number":192,"box":{"x":226,"y":141,"width":377,"height":12}},{"id":"935b08a5-f89b-4f24-9660-e7fcfb1ae773","block_type":"box","text":"VMIG Ratings","page_number":192,"box":{"x":116,"y":168,"width":114,"height":12}},{"id":"735c7037-6941-4b59-a629-a082032fd2a4","block_type":"box","text":"In the case of variable rate demand obligations (“VRDOs”), a two-component rating is assigned. The","page_number":192,"box":{"x":117,"y":196,"width":749,"height":12}},{"id":"ae9ea6cf-08de-4f02-b84b-3d23c94ba5b8","block_type":"box","text":"components are a long-term rating and a short-term payment obligation rating. The long-term rating","page_number":192,"box":{"x":116,"y":211,"width":744,"height":12}},{"id":"e00db986-dcd4-4250-bd43-baa3761d0fad","block_type":"box","text":"addresses the issuer’s ability to meet scheduled principal and interest payments. The short-term","page_number":192,"box":{"x":116,"y":227,"width":719,"height":12}},{"id":"5ba22837-55de-4a76-bc9c-3382150ecefb","block_type":"box","text":"payment obligation rating addresses the ability of the issuer or the liquidity provider to meet any","page_number":192,"box":{"x":117,"y":242,"width":713,"height":12}},{"id":"bb647e67-ef83-4b36-98af-3f8eda713759","block_type":"box","text":"purchase-price payment obligation resulting from optional tenders (“on demand”) and/or mandatory","page_number":192,"box":{"x":117,"y":258,"width":740,"height":12}},{"id":"30a08e19-f690-4262-adf7-452973df637c","block_type":"box","text":"tenders of the VRDO. The short-term demand obligation rating uses the VMIG scale. VMIG ratings with","page_number":192,"box":{"x":116,"y":273,"width":772,"height":12}},{"id":"3cfa3022-842c-499c-8890-512cd4d1cab7","block_type":"box","text":"liquidity support use as an input the short-term Counterparty Risk Assessment of the support provider,","page_number":192,"box":{"x":117,"y":289,"width":762,"height":12}},{"id":"5a4a96f7-ea0c-4706-b01d-0f8b79ea873d","block_type":"box","text":"or the long-term rating of the underlying obligor in the absence of third party liquidity support.","page_number":192,"box":{"x":116,"y":304,"width":693,"height":12}},{"id":"22a7d3a5-b2b7-481e-a9dd-450d723e6276","block_type":"box","text":"Transitions of VMIG ratings of demand obligations with conditional liquidity support differ from","page_number":192,"box":{"x":116,"y":320,"width":699,"height":12}},{"id":"b3a4582d-5af8-45fb-85ad-5a16e108e02f","block_type":"box","text":"transitions on the Prime scale to reflect the risk that external liquidity support will terminate if the","page_number":192,"box":{"x":116,"y":335,"width":717,"height":12}},{"id":"fbd949a2-2ffe-4ef4-941b-c9e2467bfda9","block_type":"box","text":"issuer’s long-term rating drops below investment grade.","page_number":192,"box":{"x":117,"y":351,"width":417,"height":12}},{"id":"827ccaa1-8691-457c-837d-e920e9e5df19","block_type":"box","text":"Moody’s typically assigns the VMIG short-term demand obligation rating if the frequency of the demand","page_number":192,"box":{"x":117,"y":378,"width":771,"height":12}},{"id":"5d947b32-07dd-4d4f-bb3c-1f6e5a4502d6","block_type":"box","text":"feature is less than every three years. If the frequency of the demand feature is less than three years","page_number":192,"box":{"x":116,"y":393,"width":753,"height":12}},{"id":"ab667c26-f7f1-45e7-bbbe-49b991b7d441","block_type":"box","text":"but the purchase price is payable only with remarketing proceeds, the short-term demand obligation","page_number":192,"box":{"x":117,"y":409,"width":745,"height":12}},{"id":"247d6dd2-6f95-4e4f-84d3-ad4272a91a7a","block_type":"box","text":"rating is “NR”.","page_number":192,"box":{"x":117,"y":424,"width":107,"height":12}},{"id":"26fb03ce-2af8-472a-b73b-4ff77b6713a7","block_type":"box","text":"Industrial development bonds in the US where the obligor is a corporate may carry a VMIG rating that","page_number":192,"box":{"x":117,"y":451,"width":758,"height":12}},{"id":"2f779b40-aa88-4c05-8fbb-3c04aa87ced3","block_type":"box","text":"reflects Moody’s view of the relative likelihood of default and loss. In these cases, liquidity assessment","page_number":192,"box":{"x":117,"y":467,"width":763,"height":12}},{"id":"4b61117b-7bc4-48e4-be9b-4e21cf903168","block_type":"box","text":"is based on the liquidity of the corporate obligor.","page_number":192,"box":{"x":117,"y":482,"width":361,"height":12}},{"id":"2eb78f48-c8e5-4865-ac56-a9fe9c63b32e","block_type":"box","text":"VMIG Scale","page_number":192,"box":{"x":116,"y":509,"width":94,"height":10}},{"id":"5d9f17f1-a7b0-4ad2-ad4b-6e988e0f2135","block_type":"box","text":"VMIG 1 This designation denotes superior credit quality. Excellent protection is afforded by the","page_number":192,"box":{"x":116,"y":537,"width":756,"height":12}},{"id":"8b07f0b9-ffcb-43db-be53-93eb79c965f2","block_type":"box","text":"superior short-term credit strength of the liquidity provider and structural and legal","page_number":192,"box":{"x":226,"y":552,"width":610,"height":12}},{"id":"61f63877-5730-4175-9475-1c5457f59dd2","block_type":"box","text":"protections.","page_number":192,"box":{"x":226,"y":568,"width":91,"height":12}},{"id":"73c2b337-98fb-470d-b782-44f22c4afffa","block_type":"box","text":"VMIG 2 This designation denotes strong credit quality. Good protection is afforded by the strong","page_number":192,"box":{"x":116,"y":591,"width":766,"height":12}},{"id":"9c3f4161-1514-4bad-b5c8-f37af665d379","block_type":"box","text":"short-term credit strength of the liquidity provider and structural and legal protections.","page_number":192,"box":{"x":226,"y":606,"width":636,"height":12}},{"id":"67aca70e-c544-4087-8dd4-9f15702f4ea6","block_type":"box","text":"VMIG 3 This designation denotes acceptable credit quality. Adequate protection is afforded by","page_number":192,"box":{"x":116,"y":630,"width":752,"height":12}},{"id":"f54f6b01-17c1-422a-a794-8ecd9d69c401","block_type":"box","text":"the satisfactory short-term credit strength of the liquidity provider and structural and","page_number":192,"box":{"x":225,"y":645,"width":624,"height":12}},{"id":"2f91beb2-a616-4605-a082-1dba00eec1bd","block_type":"box","text":"legal protections.","page_number":192,"box":{"x":226,"y":661,"width":125,"height":12}},{"id":"b2889430-dbb4-41f1-bc80-41a6ae1eca48","block_type":"box","text":"SG This designation denotes speculative-grade credit quality. Demand features rated in this","page_number":192,"box":{"x":116,"y":684,"width":762,"height":12}},{"id":"ad9abcb4-b45e-4a9e-8339-06642f758712","block_type":"box","text":"category may be supported by a liquidity provider that does not have a sufficiently","page_number":192,"box":{"x":226,"y":699,"width":606,"height":13}},{"id":"dc70fb3f-c5e9-4299-8113-744c27e43b5a","block_type":"box","text":"strong short-term rating or may lack the structural or legal protections.","page_number":192,"box":{"x":226,"y":715,"width":517,"height":12}},{"id":"fed85cb3-ca92-45cc-a652-fd9f5bd102a3","block_type":"box","text":"Description of S&P Global Ratings (“S&P”), a Division of S&P Global Inc., Issue Credit Ratings","page_number":192,"box":{"x":117,"y":742,"width":753,"height":12}},{"id":"c1576eed-61ae-4c1b-9837-cb21e0c7d4fd","block_type":"box","text":"An S&P issue credit rating is a forward-looking opinion about the creditworthiness of an obligor with","page_number":192,"box":{"x":116,"y":769,"width":737,"height":12}},{"id":"d8053fde-79af-4082-9b0a-ae3ca574d418","block_type":"box","text":"respect to a specific financial obligation, a specific class of financial obligations, or a specific financial","page_number":192,"box":{"x":117,"y":785,"width":748,"height":12}},{"id":"26e377d9-4944-4722-81b2-9b2a06265284","block_type":"box","text":"program (including ratings on medium-term note programs and commercial paper programs). It takes","page_number":192,"box":{"x":117,"y":800,"width":750,"height":12}},{"id":"858aa640-6df4-47ef-93e9-4d4a8c15b3fe","block_type":"box","text":"into consideration the creditworthiness of guarantors, insurers, or other forms of credit enhancement","page_number":192,"box":{"x":117,"y":816,"width":744,"height":12}},{"id":"a8c76ea5-7304-4081-918d-57fbf8432682","block_type":"box","text":"on the obligation and takes into account the currency in which the obligation is denominated. The","page_number":192,"box":{"x":116,"y":831,"width":726,"height":12}},{"id":"a9dac561-7d95-4eff-9d29-6fb8429873c2","block_type":"box","text":"opinion reflects S&P’s view of the obligor’s capacity and willingness to meet its financial commitments","page_number":192,"box":{"x":116,"y":847,"width":759,"height":12}},{"id":"0056a00f-1e83-4b11-9c52-065026499b46","block_type":"box","text":"as they come due, and this opinion may assess terms, such as collateral security and subordination,","page_number":192,"box":{"x":116,"y":862,"width":750,"height":12}},{"id":"524168c3-52fe-40a0-a391-670db19d4ff0","block_type":"box","text":"which could affect ultimate payment in the event of default.","page_number":192,"box":{"x":116,"y":878,"width":441,"height":12}},{"id":"2792dce1-950a-40d1-b5cc-a96566aed56c","block_type":"box","text":"A-4","page_number":192,"box":{"x":486,"y":909,"width":26,"height":9}},{"id":"8b52d71d-429d-47f0-91c6-a8e2d570a98e","block_type":"box","text":"NM0926U-5926888-192/257","page_number":192,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"6af4c62e-7733-471d-b246-44850f3a706a","block_type":"box","text":"Issue credit ratings can be either long-term or short-term. Short-term issue credit ratings are generally","page_number":193,"box":{"x":117,"y":87,"width":760,"height":12}},{"id":"14c4cee9-419f-47b7-8749-1baaeeeda4dd","block_type":"box","text":"assigned to those obligations considered short-term in the relevant market, typically with an original","page_number":193,"box":{"x":116,"y":103,"width":743,"height":12}},{"id":"41b0c869-f0f1-4102-96f3-56b81cb7f898","block_type":"box","text":"maturity of no more than 365 days. Short-term issue credit ratings are also used to indicate the","page_number":193,"box":{"x":117,"y":118,"width":708,"height":12}},{"id":"93a07eb0-ff74-4bcd-ac39-349592d1c16e","block_type":"box","text":"creditworthiness of an obligor with respect to put features on long-term obligations. S&P would typically","page_number":193,"box":{"x":116,"y":134,"width":771,"height":12}},{"id":"3108f0f7-292e-488c-91f7-f0a2398cbb11","block_type":"box","text":"assign a long-term issue credit rating to an obligation with an original maturity of greater than 365 days.","page_number":193,"box":{"x":116,"y":149,"width":772,"height":12}},{"id":"5a1c5929-4e4b-43b9-aaa4-5a9e34579fcb","block_type":"box","text":"However, the ratings S&P assigns to certain instruments may diverge from these guidelines based on","page_number":193,"box":{"x":117,"y":165,"width":758,"height":12}},{"id":"1a57c9dc-c587-4126-b629-f6a80cd6f4fb","block_type":"box","text":"market practices.","page_number":193,"box":{"x":117,"y":180,"width":132,"height":12}},{"id":"cc50644c-4403-49ac-bd8a-36de55998214","block_type":"box","text":"Issue credit ratings are based, in varying degrees, on S&P’s analysis of the following considerations:","page_number":193,"box":{"x":117,"y":208,"width":750,"height":12}},{"id":"6067d2dd-9061-48f9-a432-bb6cc78fe9ff","block_type":"box","text":"• The likelihood of payment — the capacity and willingness of the obligor to meet its financial","page_number":193,"box":{"x":117,"y":237,"width":714,"height":12}},{"id":"d697ab21-32ae-455c-b40f-c26d22f05f56","block_type":"box","text":"commitments on an obligation in accordance with the terms of the obligation;","page_number":193,"box":{"x":150,"y":252,"width":575,"height":12}},{"id":"8576102c-04bc-4a1e-8106-d9247804c857","block_type":"box","text":"• The nature and provisions of the financial obligation, and the promise S&P imputes; and","page_number":193,"box":{"x":117,"y":274,"width":691,"height":12}},{"id":"8c946e81-be37-472d-9411-17050b3bd875","block_type":"box","text":"• The protection afforded by, and relative position of, the financial obligation in the event of a","page_number":193,"box":{"x":117,"y":296,"width":712,"height":12}},{"id":"2443a529-a815-4be5-8b3e-eb8d01125d00","block_type":"box","text":"bankruptcy, reorganization, or other arrangement under the laws of bankruptcy and other laws","page_number":193,"box":{"x":150,"y":312,"width":704,"height":12}},{"id":"68733687-0a2a-49ca-a37b-7e4bcd4e2455","block_type":"box","text":"affecting creditors’ rights.","page_number":193,"box":{"x":150,"y":327,"width":191,"height":12}},{"id":"c055dee2-b0d7-4c5e-b89f-de6f99400576","block_type":"box","text":"An issue rating is an assessment of default risk but may incorporate an assessment of relative seniority","page_number":193,"box":{"x":116,"y":355,"width":772,"height":13}},{"id":"4f7b1cb9-7d66-47c1-adef-976673417e36","block_type":"box","text":"or ultimate recovery in the event of default. Junior obligations are typically rated lower than senior","page_number":193,"box":{"x":116,"y":371,"width":728,"height":12}},{"id":"30c21882-e20e-489e-b17e-18e956fdcaca","block_type":"box","text":"obligations, to reflect lower priority in bankruptcy, as noted above. (Such differentiation may apply","page_number":193,"box":{"x":116,"y":386,"width":729,"height":13}},{"id":"d4817af9-caa8-412c-ab54-83af3111011b","block_type":"box","text":"when an entity has both senior and subordinated obligations, secured and unsecured obligations, or","page_number":193,"box":{"x":116,"y":402,"width":747,"height":12}},{"id":"f8b9e035-e9d9-4888-97f6-11a78ea27e07","block_type":"box","text":"operating company and holding company obligations.)","page_number":193,"box":{"x":116,"y":417,"width":407,"height":13}},{"id":"be9b6cab-15a9-4cb0-9d67-89985e126cef","block_type":"box","text":"Long-Term Issue Credit Ratings*","page_number":193,"box":{"x":117,"y":446,"width":265,"height":12}},{"id":"b3d422b0-efc1-483a-8531-7d75968be6fd","block_type":"box","text":"AAA An obligation rated ‘AAA’ has the highest rating assigned by S&P. The obligor’s capacity","page_number":193,"box":{"x":116,"y":474,"width":770,"height":12}},{"id":"7cec7653-9b29-4952-8f0b-4e3096bec437","block_type":"box","text":"to meet its financial commitments on the obligation is extremely strong.","page_number":193,"box":{"x":225,"y":490,"width":533,"height":12}},{"id":"e0ebbe70-f223-452a-b4bb-07cbd5ecb9b9","block_type":"box","text":"AA An obligation rated ‘AA’ differs from the highest-rated obligations only to a small degree.","page_number":193,"box":{"x":116,"y":513,"width":768,"height":12}},{"id":"e020ce94-b1c8-477b-adac-5e3138ca3590","block_type":"box","text":"The obligor’s capacity to meet its financial commitments on the obligation is very strong.","page_number":193,"box":{"x":225,"y":528,"width":659,"height":13}},{"id":"82c11e52-f35a-46bf-85b3-dd3ad0b39fbd","block_type":"box","text":"A An obligation rated ‘A’ is somewhat more susceptible to the adverse effects of changes","page_number":193,"box":{"x":116,"y":552,"width":760,"height":12}},{"id":"be5f9e1f-0544-47e4-974f-e734a9504177","block_type":"box","text":"in circumstances and economic conditions than obligations in higher-rated categories.","page_number":193,"box":{"x":226,"y":567,"width":642,"height":12}},{"id":"38bba6e2-e4d0-4dc8-83a2-a469975157e6","block_type":"box","text":"However, the obligor’s capacity to meet its financial commitments on the obligation is","page_number":193,"box":{"x":226,"y":583,"width":635,"height":12}},{"id":"6d0b2075-a940-4642-bc98-07b7e7131eed","block_type":"box","text":"still strong.","page_number":193,"box":{"x":226,"y":598,"width":84,"height":12}},{"id":"3d934636-052e-47ff-bc75-3d23a161a798","block_type":"box","text":"BBB An obligation rated ‘BBB’ exhibits adequate protection parameters. However, adverse","page_number":193,"box":{"x":117,"y":621,"width":749,"height":13}},{"id":"34ae3fab-71ec-45a3-8237-798ee7e8768d","block_type":"box","text":"economic conditions or changing circumstances are more likely to weaken the obligor’s","page_number":193,"box":{"x":226,"y":637,"width":652,"height":12}},{"id":"87cadc75-e3b0-40f2-9230-c8bd9941eb24","block_type":"box","text":"capacity to meet its financial commitments on the obligation.","page_number":193,"box":{"x":226,"y":652,"width":452,"height":13}},{"id":"2ba0dd91-fa91-4ffd-849d-438e32ab6e8a","block_type":"box","text":"BB, B,","page_number":193,"box":{"x":117,"y":676,"width":45,"height":11}},{"id":"e43b8bad-b27e-4c8c-af77-78e09b681b62","block_type":"box","text":"CCC, CC,","page_number":193,"box":{"x":117,"y":691,"width":72,"height":11}},{"id":"708cb02c-fbcd-4022-b835-167371d39821","block_type":"box","text":"and C","page_number":193,"box":{"x":116,"y":707,"width":44,"height":9}},{"id":"663ab19b-6546-4347-9863-5965f5dbb949","block_type":"box","text":"Obligations rated ‘BB’, ‘B’, ‘CCC’, ‘CC’, and ‘C’ are regarded as having significant","page_number":193,"box":{"x":226,"y":676,"width":602,"height":12}},{"id":"2be15854-8707-4bcf-9e64-9d44fea4ee69","block_type":"box","text":"speculative characteristics. ‘BB’ indicates the least degree of speculation and ‘C’ the","page_number":193,"box":{"x":226,"y":691,"width":624,"height":12}},{"id":"7b4ef52f-10bb-414e-9d5a-836b959cdee5","block_type":"box","text":"highest. While such obligations will likely have some quality and protective","page_number":193,"box":{"x":226,"y":707,"width":550,"height":12}},{"id":"c4478ca5-8ff4-4160-a93f-76666e99bed5","block_type":"box","text":"characteristics, these may be outweighed by large uncertainties or major exposure to","page_number":193,"box":{"x":226,"y":722,"width":631,"height":12}},{"id":"5aaa3a69-0326-42e6-9fa7-3754b39c34c1","block_type":"box","text":"adverse conditions.","page_number":193,"box":{"x":226,"y":738,"width":143,"height":9}},{"id":"61b66553-7bd3-44e4-a558-c7a0fe36b46f","block_type":"box","text":"BB An obligation rated ‘BB’ is less vulnerable to nonpayment than other speculative issues.","page_number":193,"box":{"x":117,"y":761,"width":758,"height":12}},{"id":"cac89431-0dd4-493b-ba52-e9eea86b0e99","block_type":"box","text":"However, it faces major ongoing uncertainties or exposure to adverse business,","page_number":193,"box":{"x":226,"y":776,"width":591,"height":13}},{"id":"13ad302a-fb00-4ba8-a8c3-90d664e58147","block_type":"box","text":"financial, or economic conditions that could lead to the obligor’s inadequate capacity to","page_number":193,"box":{"x":225,"y":792,"width":644,"height":12}},{"id":"e8a019f9-946a-4277-b712-0c8534f47e70","block_type":"box","text":"meet its financial commitments on the obligation.","page_number":193,"box":{"x":226,"y":807,"width":361,"height":13}},{"id":"47b44278-e8f4-4927-9454-3c646ca07235","block_type":"box","text":"B An obligation rated ‘B’ is more vulnerable to nonpayment than obligations rated ‘BB’, but","page_number":193,"box":{"x":117,"y":831,"width":767,"height":12}},{"id":"61500ba6-c709-41de-8d43-8b2620729c1f","block_type":"box","text":"the obligor currently has the capacity to meet its financial commitments on the","page_number":193,"box":{"x":225,"y":846,"width":584,"height":12}},{"id":"a3e7ae61-e9e6-49f9-a8b4-ac3c5c83676d","block_type":"box","text":"obligation. Adverse business, financial, or economic conditions will likely impair the","page_number":193,"box":{"x":226,"y":862,"width":619,"height":12}},{"id":"258cca4a-2fa5-41d0-a783-7ba3aee122f4","block_type":"box","text":"obligor’s capacity or willingness to meet its financial commitments on the obligation.","page_number":193,"box":{"x":226,"y":877,"width":625,"height":12}},{"id":"b0523573-b629-4e5a-b7e5-e1a19e3a0c18","block_type":"box","text":"A-5","page_number":193,"box":{"x":486,"y":909,"width":26,"height":9}},{"id":"ca2e7ab9-b348-40eb-a5e7-859755da9910","block_type":"box","text":"NM0926U-5926888-193/257","page_number":193,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"91cff802-6032-4ff2-a699-fe2999cd5439","block_type":"box","text":"CCC An obligation rated ‘CCC’ is currently vulnerable to nonpayment and is dependent upon","page_number":194,"box":{"x":117,"y":87,"width":762,"height":12}},{"id":"8632ad57-8310-4b65-a2ff-a02442c6ffe3","block_type":"box","text":"favorable business, financial, and economic conditions for the obligor to meet its","page_number":194,"box":{"x":225,"y":102,"width":601,"height":13}},{"id":"1b2691bf-2942-45ea-8853-c02e29de00d7","block_type":"box","text":"financial commitments on the obligation. In the event of adverse business, financial, or","page_number":194,"box":{"x":225,"y":118,"width":647,"height":12}},{"id":"7c0e9786-e103-4174-b1ec-e3eb8c308c71","block_type":"box","text":"economic conditions, the obligor is not likely to have the capacity to meet its financial","page_number":194,"box":{"x":226,"y":134,"width":634,"height":12}},{"id":"117c3e0b-f2d4-459c-a3bc-d6e489ff3d90","block_type":"box","text":"commitments on the obligation.","page_number":194,"box":{"x":226,"y":149,"width":237,"height":12}},{"id":"6b35968a-89c9-4f3f-a9b4-10bbf4ae2450","block_type":"box","text":"CC An obligation rated ‘CC’ is currently highly vulnerable to nonpayment. The ‘CC’ rating is","page_number":194,"box":{"x":117,"y":172,"width":761,"height":12}},{"id":"28209755-c971-4552-9f8c-32e8be79688b","block_type":"box","text":"used when a default has not yet occurred but S&P expects default to be a virtual","page_number":194,"box":{"x":226,"y":188,"width":602,"height":12}},{"id":"d7f0f551-8b1b-40a6-b1f8-9c38cfb2feed","block_type":"box","text":"certainty, regardless of the anticipated time to default.","page_number":194,"box":{"x":226,"y":203,"width":404,"height":12}},{"id":"bc9a4ff8-3036-4be8-8132-d01a9c4ceb22","block_type":"box","text":"C An obligation rated ‘C’ is currently highly vulnerable to nonpayment, and the obligation is","page_number":194,"box":{"x":117,"y":227,"width":769,"height":12}},{"id":"24d3995f-1d30-4755-a38b-ad0fe65ee190","block_type":"box","text":"expected to have lower relative seniority or lower ultimate recovery compared with","page_number":194,"box":{"x":226,"y":242,"width":615,"height":12}},{"id":"ab213b05-cdc5-423e-b7fa-4dda9a00b2f9","block_type":"box","text":"obligations that are rated higher.","page_number":194,"box":{"x":226,"y":258,"width":245,"height":12}},{"id":"25fac425-a44c-4709-85b8-9364b850eb0f","block_type":"box","text":"D An obligation rated ‘D’ is in default or in breach of an imputed promise. For non-hybrid","page_number":194,"box":{"x":117,"y":281,"width":751,"height":12}},{"id":"6db2b7f0-f63a-4090-b953-1a8042ef869d","block_type":"box","text":"capital instruments, the ‘D’ rating category is used when payments on an obligation are","page_number":194,"box":{"x":226,"y":296,"width":650,"height":12}},{"id":"3368ba43-3301-4f84-9900-9206ce8fa8db","block_type":"box","text":"not made on the date due, unless S&P believes that such payments will be made within","page_number":194,"box":{"x":226,"y":312,"width":655,"height":12}},{"id":"f620912d-047e-4e37-befc-08c2882a4941","block_type":"box","text":"five business days in the absence of a stated grace period or within the earlier of the","page_number":194,"box":{"x":225,"y":327,"width":632,"height":12}},{"id":"1006bfe3-a337-4e32-88da-32c341438906","block_type":"box","text":"stated grace period or 30 calendar days. The ‘D’ rating also will be used upon the filing","page_number":194,"box":{"x":226,"y":343,"width":647,"height":12}},{"id":"fb096721-0e00-4748-a6c2-0005961f0158","block_type":"box","text":"of a bankruptcy petition or the taking of similar action and where default on an obligation","page_number":194,"box":{"x":226,"y":358,"width":659,"height":12}},{"id":"7850c0be-ffab-4f20-b69e-4e1c1d00be5b","block_type":"box","text":"is a virtual certainty, for example due to automatic stay provisions. A rating on an","page_number":194,"box":{"x":226,"y":374,"width":605,"height":12}},{"id":"79e97086-e721-4b8c-a135-9783e7148ea7","block_type":"box","text":"obligation is lowered to ‘D’ if it is subject to a distressed debt restructuring.","page_number":194,"box":{"x":226,"y":389,"width":555,"height":12}},{"id":"c0b7f5ac-ac8a-4e98-98ad-a7effc278e39","block_type":"box","text":"* Ratings from ‘AA’ to ‘CCC’ may be modified by the addition of a plus (+) or minus (-) sign to show relative standing","page_number":194,"box":{"x":143,"y":420,"width":705,"height":9}},{"id":"aab44cd6-12a2-4fac-811b-7fdcbf0d5fe2","block_type":"box","text":"within the rating categories.","page_number":194,"box":{"x":170,"y":433,"width":162,"height":9}},{"id":"25a13ada-dc59-4db6-8ddf-3c1670f8ef5a","block_type":"box","text":"Short-Term Issue Credit Ratings","page_number":194,"box":{"x":116,"y":462,"width":263,"height":12}},{"id":"97efcf4a-377c-4482-8187-bef4c5dbd808","block_type":"box","text":"A-1 A short-term obligation rated ‘A-1’ is rated in the highest category by S&P. The obligor’s","page_number":194,"box":{"x":116,"y":493,"width":765,"height":12}},{"id":"df721468-6b16-45bd-b509-30f57ec60eac","block_type":"box","text":"capacity to meet its financial commitments on the obligation is strong. Within this","page_number":194,"box":{"x":226,"y":508,"width":603,"height":12}},{"id":"97961ea2-dfce-4f89-9156-a18630f65d14","block_type":"box","text":"category, certain obligations are designated with a plus sign (+). This indicates that the","page_number":194,"box":{"x":226,"y":524,"width":648,"height":12}},{"id":"9b030a21-1e39-4226-bf50-6d2a8c4bd694","block_type":"box","text":"obligor’s capacity to meet its financial commitments on these obligations is extremely","page_number":194,"box":{"x":226,"y":539,"width":635,"height":12}},{"id":"0156e738-7a65-45c7-a6e3-cd64c4b1d2a5","block_type":"box","text":"strong.","page_number":194,"box":{"x":226,"y":555,"width":55,"height":12}},{"id":"c4e93813-55aa-4717-b652-97b3407dd7f9","block_type":"box","text":"A-2 A short-term obligation rated ‘A-2’ is somewhat more susceptible to the adverse effects","page_number":194,"box":{"x":116,"y":578,"width":760,"height":12}},{"id":"26c4f6b0-4174-4213-9e40-d8b45500685c","block_type":"box","text":"of changes in circumstances and economic conditions than obligations in higher rating","page_number":194,"box":{"x":226,"y":593,"width":644,"height":13}},{"id":"7d1cd0f0-76ee-4fa9-b8f2-b0f6528ba427","block_type":"box","text":"categories. However, the obligor’s capacity to meet its financial commitments on the","page_number":194,"box":{"x":226,"y":609,"width":629,"height":12}},{"id":"1a89c1c8-03e6-4bf6-a41a-f3ca182b9b00","block_type":"box","text":"obligation is satisfactory.","page_number":194,"box":{"x":226,"y":624,"width":187,"height":13}},{"id":"8a847b79-22f7-45fd-97b3-3e03fa0a5abf","block_type":"box","text":"A-3 A short-term obligation rated ‘A-3’ exhibits adequate protection parameters. However,","page_number":194,"box":{"x":116,"y":648,"width":750,"height":12}},{"id":"89b249d8-c117-4fe2-ba0d-9f7b54c4db1f","block_type":"box","text":"adverse economic conditions or changing circumstances are more likely to weaken an","page_number":194,"box":{"x":226,"y":663,"width":639,"height":12}},{"id":"af0b7977-0039-4788-a91f-5db9bbc19f91","block_type":"box","text":"obligor’s capacity to meet its financial commitments on the obligation.","page_number":194,"box":{"x":226,"y":679,"width":513,"height":12}},{"id":"6591e521-6f51-49ab-877b-dd7b522c4b94","block_type":"box","text":"B A short-term obligation rated ‘B’ is regarded as vulnerable and has significant","page_number":194,"box":{"x":117,"y":702,"width":681,"height":12}},{"id":"41e2b152-ad98-43ed-8caf-580f6952b2e1","block_type":"box","text":"speculative characteristics. The obligor currently has the capacity to meet its financial","page_number":194,"box":{"x":226,"y":717,"width":632,"height":13}},{"id":"faa1ac10-74a8-4105-bb1c-1f7b440e6cb9","block_type":"box","text":"commitments; however, it faces major ongoing uncertainties that could lead to the","page_number":194,"box":{"x":226,"y":733,"width":607,"height":12}},{"id":"b8bfacea-d72d-48bb-8bdb-6e78edd4315a","block_type":"box","text":"obligor’s inadequate capacity to meet its financial commitments.","page_number":194,"box":{"x":226,"y":748,"width":473,"height":13}},{"id":"0c3bbc21-d66d-4706-bf11-e66ff110c303","block_type":"box","text":"C A short-term obligation rated ‘C’ is currently vulnerable to nonpayment and is dependent","page_number":194,"box":{"x":117,"y":772,"width":763,"height":12}},{"id":"e11d02af-c309-46d0-a0d1-d04f66ab0df4","block_type":"box","text":"upon favorable business, financial, and economic conditions for the obligor to meet its","page_number":194,"box":{"x":226,"y":787,"width":636,"height":12}},{"id":"83462a93-e4b9-46b4-b34a-48aa46db1920","block_type":"box","text":"financial commitments on the obligation.","page_number":194,"box":{"x":225,"y":803,"width":298,"height":12}},{"id":"5f55dc79-37c7-468f-9c0f-fd8426680f33","block_type":"box","text":"A-6","page_number":194,"box":{"x":486,"y":909,"width":26,"height":9}},{"id":"e5953b1a-d4bf-4771-89b4-adf9236d6008","block_type":"box","text":"NM0926U-5926888-194/257","page_number":194,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"60a14573-5c4a-4df2-8b5b-25038635ed98","block_type":"box","text":"D A short-term obligation rated ‘D’ is in default or in breach of an imputed promise. For","page_number":195,"box":{"x":117,"y":87,"width":739,"height":12}},{"id":"a6e6c9d0-3deb-46a1-82d0-0367b083be89","block_type":"box","text":"non-hybrid capital instruments, the ‘D’ rating category is used when payments on an","page_number":195,"box":{"x":226,"y":102,"width":629,"height":13}},{"id":"cbf75db8-1dfc-4d61-b40d-09f18b190d85","block_type":"box","text":"obligation are not made on the date due, unless S&P believes that such payments will","page_number":195,"box":{"x":226,"y":118,"width":643,"height":12}},{"id":"9e6e0014-9dd0-411e-8728-e444ed8814d9","block_type":"box","text":"be made within any stated grace period. However, any stated grace period longer than","page_number":195,"box":{"x":226,"y":134,"width":648,"height":12}},{"id":"c3fcdb42-c5c4-410c-842b-8e173f720d97","block_type":"box","text":"five business days will be treated as five business days. The ‘D’ rating also will be used","page_number":195,"box":{"x":225,"y":149,"width":653,"height":12}},{"id":"b915f76e-e1b0-4382-aa64-4f42068974f0","block_type":"box","text":"upon the filing of a bankruptcy petition or the taking of a similar action and where default","page_number":195,"box":{"x":226,"y":165,"width":659,"height":12}},{"id":"291158b6-641d-45f2-ae67-114b1b1185be","block_type":"box","text":"on an obligation is a virtual certainty, for example due to automatic stay provisions. A","page_number":195,"box":{"x":226,"y":180,"width":635,"height":12}},{"id":"81c0e323-548a-4b5f-a6f7-626c08fc6cef","block_type":"box","text":"rating on an obligation is lowered to ‘D’ if it is subject to a distressed debt restructuring.","page_number":195,"box":{"x":226,"y":196,"width":648,"height":12}},{"id":"a0e6d99c-ab41-4b20-bff8-4319eeff291f","block_type":"box","text":"Description of S&P’s Municipal Short-Term Note Ratings","page_number":195,"box":{"x":117,"y":223,"width":456,"height":12}},{"id":"583cd59c-f0a2-4e2f-a552-685b686b3db2","block_type":"box","text":"An S&P U.S. municipal note rating reflects S&P’s opinion about the liquidity factors and market access","page_number":195,"box":{"x":116,"y":250,"width":766,"height":12}},{"id":"02384925-9997-4f46-9545-eebf39cef0a7","block_type":"box","text":"risks unique to the notes. Notes due in three years or less will likely receive a note rating. Notes with","page_number":195,"box":{"x":117,"y":265,"width":748,"height":12}},{"id":"acd30472-e966-419f-9363-4d7694f3098f","block_type":"box","text":"an original maturity of more than three years will most likely receive a long-term debt rating. In","page_number":195,"box":{"x":116,"y":281,"width":703,"height":12}},{"id":"514546a0-740e-4840-b290-bb48830fa22d","block_type":"box","text":"determining which type of rating, if any, to assign, S&P’s analysis will review the following","page_number":195,"box":{"x":116,"y":296,"width":668,"height":12}},{"id":"b9df105b-e441-4af2-9cee-b1220d3f2b19","block_type":"box","text":"considerations:","page_number":195,"box":{"x":116,"y":312,"width":118,"height":9}},{"id":"2acf2f5e-10d5-4193-9629-a0bd692657a1","block_type":"box","text":"• Amortization schedule — the larger the final maturity relative to other maturities, the more likely it","page_number":195,"box":{"x":125,"y":339,"width":750,"height":12}},{"id":"168525d8-6410-48d5-8fa9-e3c7c9a70a7d","block_type":"box","text":"will be treated as a note; and","page_number":195,"box":{"x":149,"y":355,"width":220,"height":11}},{"id":"89e39f69-6aeb-44e0-ba9e-8736177c2752","block_type":"box","text":"• Source of payment — the more dependent the issue is on the market for its refinancing, the more","page_number":195,"box":{"x":125,"y":376,"width":753,"height":12}},{"id":"07a87770-1bab-4ede-867f-a67e4e8056b2","block_type":"box","text":"likely it will be treated as a note.","page_number":195,"box":{"x":150,"y":391,"width":242,"height":12}},{"id":"98ebc864-764a-434e-8359-08e6adb166b2","block_type":"box","text":"S&P’s municipal short-term note rating symbols are as follows:","page_number":195,"box":{"x":116,"y":418,"width":470,"height":12}},{"id":"72e67ca9-7a37-45ba-908e-bd6da489cc38","block_type":"box","text":"SP-1 Strong capacity to pay principal and interest. An issue determined to possess a very","page_number":195,"box":{"x":116,"y":444,"width":739,"height":12}},{"id":"19a2f65c-76e8-449d-9d11-0896601fc391","block_type":"box","text":"strong capacity to pay debt service is given a plus (+) designation.","page_number":195,"box":{"x":226,"y":458,"width":496,"height":12}},{"id":"dea88f89-5963-4402-ae51-ff48fad53179","block_type":"box","text":"SP-2 Satisfactory capacity to pay principal and interest, with some vulnerability to adverse","page_number":195,"box":{"x":116,"y":480,"width":741,"height":12}},{"id":"6f56f9bb-b30f-40f6-8e8d-55f55bc36f90","block_type":"box","text":"financial and economic changes over the term of the notes.","page_number":195,"box":{"x":225,"y":494,"width":446,"height":12}},{"id":"378f0a82-c555-47e7-b2fd-f55ba876c36f","block_type":"box","text":"SP-3 Speculative capacity to pay principal and interest.","page_number":195,"box":{"x":116,"y":515,"width":482,"height":12}},{"id":"a582ab57-c09e-47ef-ae1a-ea334d8402ea","block_type":"box","text":"D ‘D’ is assigned upon failure to pay the note when due, completion of a distressed debt","page_number":195,"box":{"x":117,"y":537,"width":750,"height":12}},{"id":"cca56677-d590-4e75-ac75-128fbe744293","block_type":"box","text":"restructuring, or the filing of a bankruptcy petition or the taking of similar action and","page_number":195,"box":{"x":226,"y":551,"width":620,"height":12}},{"id":"d1ffd93c-2326-4297-966c-e154c16cb33c","block_type":"box","text":"where default on an obligation is a virtual certainty, for example due to automatic stay","page_number":195,"box":{"x":225,"y":565,"width":640,"height":12}},{"id":"d084b759-73fb-4cef-8e02-bebe57d102e1","block_type":"box","text":"provisions.","page_number":195,"box":{"x":226,"y":579,"width":84,"height":12}},{"id":"a2a76bfe-1d1b-485f-a4d0-8ee23ad366de","block_type":"box","text":"Description of Fitch Ratings’ (“Fitch”) Credit Ratings Scales","page_number":195,"box":{"x":117,"y":606,"width":483,"height":12}},{"id":"96ac3bae-44bf-441c-a045-ffc3ff7e8e49","block_type":"box","text":"Fitch publishes credit ratings that are forward-looking opinions on the relative ability of an entity or","page_number":195,"box":{"x":117,"y":633,"width":730,"height":12}},{"id":"34a9b1b2-236c-4d48-8a82-21cec67072f4","block_type":"box","text":"obligation to meet financial commitments. Issuer default ratings (IDRs) are assigned to corporations,","page_number":195,"box":{"x":116,"y":649,"width":749,"height":12}},{"id":"91fa09f8-bd71-404d-9df3-732665937b4b","block_type":"box","text":"sovereign entities, financial institutions such as banks, leasing companies and insurers, and public","page_number":195,"box":{"x":116,"y":664,"width":730,"height":12}},{"id":"9d05133a-3027-4f2f-a998-bba3c1b292f8","block_type":"box","text":"finance entities (local and regional governments). Issue level ratings are also assigned, often include","page_number":195,"box":{"x":116,"y":680,"width":747,"height":12}},{"id":"23906966-910c-44c2-b8fd-ed426a32914b","block_type":"box","text":"an expectation of recovery and may be notched above or below the issuer level rating. Issue ratings","page_number":195,"box":{"x":116,"y":695,"width":741,"height":12}},{"id":"d4bb653b-2caf-4caf-88f0-6e7a9ca39247","block_type":"box","text":"are assigned to secured and unsecured debt securities, loans, preferred stock and other instruments,","page_number":195,"box":{"x":116,"y":711,"width":751,"height":12}},{"id":"1f2d3ff9-4998-48a3-a608-0914d0e570c3","block_type":"box","text":"Structured finance ratings are issue ratings to securities backed by receivables or other financial","page_number":195,"box":{"x":116,"y":726,"width":713,"height":12}},{"id":"e93ad349-6d2a-4535-b60b-735cccf2b0c7","block_type":"box","text":"assets that consider the obligations’ relative vulnerability to default.","page_number":195,"box":{"x":116,"y":742,"width":496,"height":12}},{"id":"5a122ae2-fd00-4c2b-adc8-42081ad50377","block_type":"box","text":"Fitch’s credit ratings relating to issuers are an opinion on the relative ability of an entity to meet","page_number":195,"box":{"x":117,"y":769,"width":702,"height":12}},{"id":"7717bde9-c362-45eb-82fe-46a7b438ef39","block_type":"box","text":"financial commitments, such as interest, preferred dividends, repayment of principal, insurance claims","page_number":195,"box":{"x":116,"y":784,"width":756,"height":12}},{"id":"1ae36dba-7dd6-4cbf-9590-cc2ced124ffa","block_type":"box","text":"or counterparty obligations. Credit ratings relating to securities and obligations of an issuer can include","page_number":195,"box":{"x":116,"y":800,"width":761,"height":12}},{"id":"599c4ee9-2b3c-4cba-ba01-ab628d3d6cea","block_type":"box","text":"a recovery expectation. Credit ratings are used by investors as indications of the likelihood of receiving","page_number":195,"box":{"x":116,"y":815,"width":761,"height":12}},{"id":"668a60dd-9904-4e88-a735-d7e134a88167","block_type":"box","text":"the money owed to them in accordance with the terms on which they invested. The agency’s credit","page_number":195,"box":{"x":116,"y":831,"width":738,"height":12}},{"id":"78a5314e-92e0-4957-9aec-5e1c45775c7d","block_type":"box","text":"ratings cover the global spectrum of corporate, sovereign financial, bank, insurance, and public finance","page_number":195,"box":{"x":117,"y":846,"width":768,"height":12}},{"id":"4041a67c-67bb-49db-872a-16fad9bfaa98","block_type":"box","text":"entities (including supranational and sub-national entities) and the securities or other obligations they","page_number":195,"box":{"x":116,"y":862,"width":754,"height":12}},{"id":"197fca5b-716e-43ba-8c56-a8466bd404bd","block_type":"box","text":"issue, as well as structured finance securities backed by receivables or other financial assets.","page_number":195,"box":{"x":117,"y":877,"width":698,"height":12}},{"id":"4be83d11-2971-455c-a010-fe78b40f0785","block_type":"box","text":"A-7","page_number":195,"box":{"x":486,"y":909,"width":26,"height":9}},{"id":"67136d1c-631f-4d3f-9b0e-74c327602d93","block_type":"box","text":"NM0926U-5926888-195/257","page_number":195,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"b5d31c1e-b542-42ce-bca3-664d1a378288","block_type":"box","text":"The terms “investment grade” and “speculative grade” have established themselves over time as","page_number":196,"box":{"x":116,"y":87,"width":723,"height":12}},{"id":"7fb2f9d7-2930-462c-a925-8eaf61863b57","block_type":"box","text":"shorthand to describe the categories ‘AAA’ to ‘BBB’ (investment grade) and ‘BB’ to ‘D’ (speculative","page_number":196,"box":{"x":116,"y":102,"width":737,"height":13}},{"id":"5f37f08a-3a41-4644-847b-fd0e88958398","block_type":"box","text":"grade). The terms investment grade and speculative grade are market conventions and do not imply","page_number":196,"box":{"x":116,"y":118,"width":749,"height":12}},{"id":"7bb78a2d-dfc7-4a69-8569-98a3d4a65a5c","block_type":"box","text":"any recommendation or endorsement of a specific security for investment purposes. Investment grade","page_number":196,"box":{"x":116,"y":134,"width":764,"height":12}},{"id":"4886b6fa-d797-4deb-ab0a-a0e4a35e180e","block_type":"box","text":"categories indicate relatively low to moderate credit risk, while ratings in the speculative categories","page_number":196,"box":{"x":116,"y":149,"width":737,"height":12}},{"id":"1436bd17-0b61-453c-99cf-441a8985e422","block_type":"box","text":"either signal a higher level of credit risk or that a default has already occurred.","page_number":196,"box":{"x":116,"y":165,"width":584,"height":12}},{"id":"81714c6e-e121-4268-90b6-b9863c8480ec","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_number":196,"box":{"x":117,"y":196,"width":765,"height":12}},{"id":"ac225a83-29db-43e4-8e92-b8409dbf06de","block_type":"box","text":"page. Such issues are also denoted as ‘NR’.","page_number":196,"box":{"x":117,"y":211,"width":335,"height":12}},{"id":"0cd1709b-a076-4a3b-ba29-9701365cee5d","block_type":"box","text":"Credit ratings express risk in relative rank order, which is to say they are ordinal measures of credit risk","page_number":196,"box":{"x":117,"y":242,"width":770,"height":12}},{"id":"1ad2bd56-3869-4a25-bd8a-7781b08dcbdd","block_type":"box","text":"and are not predictive of a specific frequency of default or loss.","page_number":196,"box":{"x":116,"y":258,"width":471,"height":12}},{"id":"589b1d0d-e680-481e-954f-362afca10cae","block_type":"box","text":"Fitch’s credit ratings do not directly address any risk other than credit risk. In particular, ratings do not","page_number":196,"box":{"x":117,"y":289,"width":756,"height":12}},{"id":"ebf444c1-bad1-44c2-a440-8dd8b148c76c","block_type":"box","text":"deal with the risk of a market value loss on a rated security due to changes in interest rates, liquidity","page_number":196,"box":{"x":116,"y":304,"width":747,"height":12}},{"id":"09eccfe1-8955-46cb-b816-64d9d6dc25cd","block_type":"box","text":"and other market considerations. However, in terms of payment obligation on the rated liability, market","page_number":196,"box":{"x":116,"y":320,"width":765,"height":12}},{"id":"b5c15455-08d0-40dc-98d3-4e8a044079b4","block_type":"box","text":"risk may be considered to the extent that it influences the ability of an issuer to pay upon a","page_number":196,"box":{"x":117,"y":335,"width":674,"height":12}},{"id":"d6879ffd-6a3f-45fd-8bf0-647526e10144","block_type":"box","text":"commitment.","page_number":196,"box":{"x":116,"y":351,"width":101,"height":9}},{"id":"96f0f7e3-73d2-4acb-a6ba-502fc6d3a556","block_type":"box","text":"Ratings nonetheless do not reflect market risk to the extent that they influence the size or other","page_number":196,"box":{"x":117,"y":382,"width":709,"height":12}},{"id":"a5e3f7fd-7b1a-4921-aa5c-f8bf3a682a00","block_type":"box","text":"conditionality of the obligation to pay upon a commitment (for example, in the case of index-linked","page_number":196,"box":{"x":116,"y":397,"width":731,"height":12}},{"id":"b6be1955-0b8c-451c-a3c9-1d1bd441a3c7","block_type":"box","text":"bonds).","page_number":196,"box":{"x":117,"y":413,"width":59,"height":12}},{"id":"e41e57d3-2e85-462d-9dc5-d9a10e98c102","block_type":"box","text":"In the default components of ratings assigned to individual obligations or instruments, the agency","page_number":196,"box":{"x":117,"y":444,"width":725,"height":12}},{"id":"8287c1fb-ba8b-4f0f-a30f-e4613ff102ef","block_type":"box","text":"typically rates to the likelihood of non-payment or default in accordance with the terms of that","page_number":196,"box":{"x":116,"y":459,"width":695,"height":12}},{"id":"0a48c055-7034-4429-b554-dd508054aab0","block_type":"box","text":"instrument’s documentation. In limited cases, Fitch may include additional considerations (","page_number":196,"box":{"x":117,"y":475,"width":670,"height":12}},{"id":"6c9dd5e8-1f06-49fc-bfee-85101bf231ce","block_type":"box","text":"i.e.","page_number":196,"box":{"x":788,"y":475,"width":20,"height":9}},{"id":"2a042412-c511-4fa6-80be-7600dad07981","block_type":"box","text":"rate to a","page_number":196,"box":{"x":810,"y":475,"width":71,"height":9}},{"id":"f6dd5b84-bb5a-4504-a930-b3650d7d33b2","block_type":"box","text":"higher or lower standard than that implied in the obligation’s documentation).","page_number":196,"box":{"x":117,"y":490,"width":573,"height":12}},{"id":"f6895d18-6329-495c-aded-d118cec468b6","block_type":"box","text":"The primary credit rating scales can be used to provide a rating of privately issued obligations or","page_number":196,"box":{"x":116,"y":521,"width":719,"height":12}},{"id":"9d93974e-815c-4eec-94f5-70fab60a606e","block_type":"box","text":"certain note issuance programs or for private ratings. In this case the rating is not published, but only","page_number":196,"box":{"x":116,"y":537,"width":753,"height":12}},{"id":"ffd9449e-5838-4ed9-9690-7b0cd8297dab","block_type":"box","text":"provided to the issuer or its agents in the form of a rating letter.","page_number":196,"box":{"x":117,"y":552,"width":472,"height":12}},{"id":"412e774e-75ac-4eb9-86cc-03e6888379a2","block_type":"box","text":"The primary credit rating scales may also be used to provide ratings for a more narrow scope,","page_number":196,"box":{"x":116,"y":583,"width":702,"height":12}},{"id":"09c58d77-2f18-4f8b-b4b0-9f65725e8c6f","block_type":"box","text":"including interest strips and return of principal or in other forms of opinions such as credit opinions or","page_number":196,"box":{"x":117,"y":599,"width":751,"height":12}},{"id":"d4a01d14-736e-4cca-bbcb-775f832ba0d9","block_type":"box","text":"rating assessment services. Credit opinions are either a notch- or category-specific view using the","page_number":196,"box":{"x":117,"y":614,"width":731,"height":12}},{"id":"e6e05b95-bde1-4342-9fca-101a482378ad","block_type":"box","text":"primary rating scale and omit one or more characteristics of a full rating or meet them to a different","page_number":196,"box":{"x":117,"y":630,"width":736,"height":12}},{"id":"89418685-dd85-4604-a362-df1aac73d1d8","block_type":"box","text":"standard. Credit opinions will be indicated using a lower case letter symbol combined with either an ‘*’","page_number":196,"box":{"x":116,"y":645,"width":760,"height":12}},{"id":"4bef8d05-b30f-440a-99cc-aeaae1a2f000","block_type":"box","text":"(e.g. ‘bbb+*’) or (cat) suffix to denote the opinion status. Credit opinions will be point-in-time typically","page_number":196,"box":{"x":117,"y":661,"width":743,"height":12}},{"id":"d90f81f5-75d0-4e8e-a19e-80af869326d0","block_type":"box","text":"but may be monitored if the analytical group believes information will be sufficiently available. Rating","page_number":196,"box":{"x":117,"y":676,"width":742,"height":12}},{"id":"d6663fa1-b745-47c0-acef-1c5e02710c44","block_type":"box","text":"assessment services are a notch-specific view using the primary rating scale of how an existing or","page_number":196,"box":{"x":116,"y":692,"width":729,"height":12}},{"id":"d300382c-975b-4226-bf23-2166c416e21b","block_type":"box","text":"potential rating may be changed by a given set of hypothetical circumstances. While credit opinions","page_number":196,"box":{"x":117,"y":707,"width":736,"height":12}},{"id":"a8ad3251-2f9c-4740-ab3e-9ded400777ab","block_type":"box","text":"and rating assessment services are point-in-time and are not monitored, they may have a directional","page_number":196,"box":{"x":116,"y":723,"width":745,"height":12}},{"id":"0f8dae2e-ee65-4090-8515-239670fa9f88","block_type":"box","text":"watch or outlook assigned, which can signify the trajectory of the credit profile.","page_number":196,"box":{"x":116,"y":738,"width":579,"height":12}},{"id":"7a06be24-bcba-4c5c-8fc8-db79c990d701","block_type":"box","text":"Description of Fitch’s Long-Term Corporate Finance Obligations Rating Scales","page_number":196,"box":{"x":117,"y":769,"width":629,"height":12}},{"id":"5893652c-e9bc-4354-a387-1b58bdfe4718","block_type":"box","text":"Ratings of individual securities or financial obligations of a corporate issuer address relative","page_number":196,"box":{"x":117,"y":800,"width":677,"height":12}},{"id":"c7768347-73fc-44b2-9fdf-c5f2e8fa400e","block_type":"box","text":"vulnerability to default on an ordinal scale. In addition, for financial obligations in corporate finance, a","page_number":196,"box":{"x":116,"y":816,"width":746,"height":12}},{"id":"9a70951f-fabe-40ce-b413-bdbd340846eb","block_type":"box","text":"measure of recovery given default on that liability is also included in the rating assessment. This","page_number":196,"box":{"x":117,"y":831,"width":716,"height":12}},{"id":"51e8e64b-3de8-4ed6-8bd7-fc3e3cb79feb","block_type":"box","text":"notably applies to covered bonds ratings, which incorporate both an indication of the probability of","page_number":196,"box":{"x":117,"y":847,"width":729,"height":12}},{"id":"05579b39-5c33-4ee8-a968-94feb1c7c743","block_type":"box","text":"default and of the recovery given a default of this debt instrument. 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Individual obligations can be assigned ratings higher, lower, or the same as that entity’s","page_number":197,"box":{"x":117,"y":103,"width":728,"height":12}},{"id":"ce3d438b-7e3a-4502-8b36-5bda1a7ae0f0","block_type":"box","text":"issuer rating or issuer default rating (“IDR”), based on their relative ranking, relative vulnerability to","page_number":197,"box":{"x":117,"y":118,"width":733,"height":12}},{"id":"113aabce-a848-492a-9eae-14bc6ca9a901","block_type":"box","text":"default or based on explicit Recovery Ratings.","page_number":197,"box":{"x":116,"y":134,"width":347,"height":12}},{"id":"db33daf9-e09f-4de1-8e70-12b260197c52","block_type":"box","text":"As a result, individual obligations of entities, such as corporations, are assigned ratings higher, lower,","page_number":197,"box":{"x":116,"y":165,"width":756,"height":12}},{"id":"94e28c33-f6e0-4601-801f-d7172bcf510e","block_type":"box","text":"or the same as that entity’s issuer rating or IDR, except DIP obligation ratings that are not based off an","page_number":197,"box":{"x":116,"y":180,"width":766,"height":12}},{"id":"200429e4-e0a9-436e-a200-d000e55c3939","block_type":"box","text":"IDR. At the lower end of the ratings scale, Fitch publishes explicit Recovery Ratings in many cases to","page_number":197,"box":{"x":117,"y":196,"width":756,"height":12}},{"id":"03adf8d9-1fdf-4a08-bec8-e64b4fab2993","block_type":"box","text":"complement issuer and obligation ratings.","page_number":197,"box":{"x":116,"y":211,"width":315,"height":12}},{"id":"67522f6e-3bca-4494-ade7-12ce18c3b846","block_type":"box","text":"Fitch long-term obligations rating scales are as follows:","page_number":197,"box":{"x":117,"y":242,"width":412,"height":12}},{"id":"0e3727b5-e0ee-4ea3-9fa1-5182343575bc","block_type":"box","text":"AAA Highest Credit Quality. ‘AAA’ ratings denote the lowest expectation of default risk. They","page_number":197,"box":{"x":116,"y":273,"width":762,"height":12}},{"id":"a1288d85-f977-4f6f-8367-17ce5764bf2f","block_type":"box","text":"are assigned only in cases of exceptionally strong capacity for payment of financial","page_number":197,"box":{"x":226,"y":288,"width":619,"height":12}},{"id":"95c77be3-4bb4-4789-918c-f17a240dae93","block_type":"box","text":"commitments. This capacity is highly unlikely to be adversely affected by foreseeable","page_number":197,"box":{"x":226,"y":302,"width":636,"height":13}},{"id":"bb773f16-b88d-45b1-8cf5-576316273b1a","block_type":"box","text":"events.","page_number":197,"box":{"x":226,"y":318,"width":58,"height":9}},{"id":"ca3ee90c-762f-4650-9393-664d1d8fd030","block_type":"box","text":"AA Very High Credit Quality. ‘AA’ ratings denote expectations of very low default risk. They","page_number":197,"box":{"x":116,"y":340,"width":762,"height":13}},{"id":"1e0cb10f-5965-4218-b66a-083ede0151e0","block_type":"box","text":"indicate very strong capacity for payment of financial commitments. This capacity is not","page_number":197,"box":{"x":226,"y":355,"width":652,"height":13}},{"id":"317cfc4b-773b-4184-8972-bdd20176174d","block_type":"box","text":"significantly vulnerable to foreseeable events.","page_number":197,"box":{"x":226,"y":370,"width":343,"height":12}},{"id":"748cc6bf-468d-4bba-8c02-0c2fc1b30517","block_type":"box","text":"A High Credit Quality. ‘A’ ratings denote expectations of low default risk. The capacity for","page_number":197,"box":{"x":116,"y":393,"width":757,"height":12}},{"id":"08e37f38-3669-40eb-9354-3edb68b24d40","block_type":"box","text":"payment of financial commitments is considered strong. This capacity may,","page_number":197,"box":{"x":226,"y":408,"width":562,"height":12}},{"id":"e87644bb-b8e5-4e3b-a0b7-4a61789f1c58","block_type":"box","text":"nevertheless, be more vulnerable to adverse business or economic conditions than is","page_number":197,"box":{"x":226,"y":423,"width":638,"height":11}},{"id":"fb42ecb4-cb08-4507-8cd9-e42d07c89053","block_type":"box","text":"the case for higher ratings.","page_number":197,"box":{"x":225,"y":438,"width":204,"height":12}},{"id":"3c78999a-ad0a-45ec-b268-d4c5caeea675","block_type":"box","text":"BBB Good Credit Quality. ‘BBB’ ratings indicate that expectations of default risk are currently","page_number":197,"box":{"x":117,"y":461,"width":764,"height":12}},{"id":"b447e011-bb69-4e23-8177-4ac8a23eb1b5","block_type":"box","text":"low. The capacity for payment of financial commitments is considered adequate, but","page_number":197,"box":{"x":226,"y":476,"width":629,"height":12}},{"id":"4c9ce6b5-524b-44ba-891d-8c6fdbc1f087","block_type":"box","text":"adverse business or economic conditions are more likely to impair this capacity.","page_number":197,"box":{"x":226,"y":491,"width":597,"height":12}},{"id":"d63fa861-d109-4463-9406-ab09c32a3224","block_type":"box","text":"BB Speculative. ‘BB’ ratings indicate an elevated vu","page_number":197,"box":{"x":117,"y":514,"width":457,"height":12}},{"id":"69758e48-637a-4522-803b-df6cdc64e423","block_type":"box","text":"lnerability to default risk, particularly in the","page_number":197,"box":{"x":576,"y":514,"width":308,"height":12}},{"id":"b67a129f-0da5-443a-8ced-3b1a415a6349","block_type":"box","text":"event of adverse changes in business or economic conditions over time; however,","page_number":197,"box":{"x":226,"y":529,"width":601,"height":12}},{"id":"d0350741-e542-4300-bc1c-cc8eb084f527","block_type":"box","text":"business or financial flexibility exists that s","page_number":197,"box":{"x":226,"y":544,"width":305,"height":12}},{"id":"d40af4e9-4329-4934-abf7-6d81a95f6c24","block_type":"box","text":"upports the servicing of financial commitments.","page_number":197,"box":{"x":533,"y":544,"width":345,"height":12}},{"id":"58d884de-4cb3-4daa-991f-76c860bd488c","block_type":"box","text":"B Highly Speculative. ‘B’ ratings indicate that","page_number":197,"box":{"x":117,"y":567,"width":417,"height":12}},{"id":"d0010533-b834-43a4-88e7-cde46efb13df","block_type":"box","text":"t material default risk is present, but a limited","page_number":197,"box":{"x":534,"y":567,"width":326,"height":12}},{"id":"3b09e4f8-cec4-4b53-a435-d3679eb17f39","block_type":"box","text":"margin of safety remains. Financial co","page_number":197,"box":{"x":226,"y":582,"width":276,"height":12}},{"id":"f8f22284-a468-4a13-bd2e-8a8aefa25645","block_type":"box","text":"mmitments are currently being met; however,","page_number":197,"box":{"x":503,"y":582,"width":334,"height":12}},{"id":"1294afc9-b7d2-4aa4-aff7-266321705e38","block_type":"box","text":"capacity for continued payment is vulner","page_number":197,"box":{"x":226,"y":597,"width":293,"height":12}},{"id":"fd30b446-5f8e-4093-9b08-a9a637039f5c","block_type":"box","text":"able to deterioration in the business and","page_number":197,"box":{"x":519,"y":597,"width":296,"height":9}},{"id":"7a88b780-8646-4af6-96b2-0d809d5f4aa5","block_type":"box","text":"economic environment.","page_number":197,"box":{"x":226,"y":612,"width":174,"height":9}},{"id":"f46f9630-bd06-4314-87e1-87d8df309032","block_type":"box","text":"CCC Substantial Credit Risk. ‘CCC’ ratings indicate very low margin for safety. Default is a","page_number":197,"box":{"x":117,"y":635,"width":744,"height":12}},{"id":"1a295886-69cd-45a7-95b5-ade846ad2c4d","block_type":"box","text":"real possibility.","page_number":197,"box":{"x":226,"y":650,"width":114,"height":12}},{"id":"a16195d5-9517-4816-bf56-ebc88c7c84c8","block_type":"box","text":"CC Very High Levels of Credit Risk. ‘CC’ ratings indicate default of some kind appears","page_number":197,"box":{"x":117,"y":673,"width":720,"height":12}},{"id":"c8fd5db6-5e52-4d5d-b1fc-972836d1c70b","block_type":"box","text":"probable.","page_number":197,"box":{"x":226,"y":688,"width":68,"height":11}},{"id":"3c041785-7261-4e2a-9af3-6d571d02b458","block_type":"box","text":"C Exceptionally High Levels of Credit Risk. ‘C’ ratings indicate default or default-like","page_number":197,"box":{"x":117,"y":710,"width":713,"height":12}},{"id":"f99a157e-62ee-4b1f-a501-7005fff1c22c","block_type":"box","text":"process has begun, or for a closed funding vehicle, payment capacity is irrevocably","page_number":197,"box":{"x":226,"y":725,"width":617,"height":12}},{"id":"f8acc604-13cc-46d5-924a-e0dd292484c1","block_type":"box","text":"impaired.","page_number":197,"box":{"x":226,"y":740,"width":67,"height":12}},{"id":"486f5e30-2c18-43dc-8ab2-607157ee160c","block_type":"box","text":"RD Restricted Default. ‘RD’ ratings indicate an i","page_number":197,"box":{"x":117,"y":763,"width":416,"height":12}},{"id":"7c1c8473-6680-4fd2-a246-2fc18a6f8fbe","block_type":"box","text":"ssuer that in Fitch’s opinion has experienced an","page_number":197,"box":{"x":535,"y":763,"width":338,"height":12}},{"id":"535f3589-93a3-4482-a110-a647f7121372","block_type":"box","text":"uncured payment default or distressed debt","page_number":197,"box":{"x":226,"y":778,"width":309,"height":12}},{"id":"83baf209-8141-4cd4-b8d8-0616c8e533a1","block_type":"box","text":"exchange on a bond, loan or other material","page_number":197,"box":{"x":540,"y":778,"width":305,"height":12}},{"id":"3871bf1b-9ae6-4d86-b3a8-1dd132cc527e","block_type":"box","text":"financial obligation, but has not entered into","page_number":197,"box":{"x":225,"y":793,"width":309,"height":12}},{"id":"4e9eeedf-e701-4eb9-8369-403aa9fd9675","block_type":"box","text":"bankruptcy filings, administration, receivership,","page_number":197,"box":{"x":540,"y":793,"width":330,"height":12}},{"id":"fea91627-55fb-4e45-8ee6-4ddb8284eb90","block_type":"box","text":"liquidation, or other formal winding-up proc","page_number":197,"box":{"x":226,"y":808,"width":303,"height":12}},{"id":"0fdd3c5f-a275-4d56-bf41-ff5a93924cf7","block_type":"box","text":"edure, and has not otherwise ceased operating.","page_number":197,"box":{"x":529,"y":808,"width":338,"height":12}},{"id":"05852ae9-7709-4195-8443-3048554e2dee","block_type":"box","text":"D Default. ‘D’ ratings indicate an issuer that in Fitch’s opinion has entered into bankruptcy","page_number":197,"box":{"x":117,"y":831,"width":761,"height":12}},{"id":"9a47d33d-5aa7-4f03-9a58-daa830a4f6c3","block_type":"box","text":"filings, administration, receivership, liquidation or other formal winding-up procedure or","page_number":197,"box":{"x":225,"y":846,"width":647,"height":12}},{"id":"77b0f32e-2154-4629-9ad3-08631c83d0af","block_type":"box","text":"that has otherwise ceased business and debt is still outstanding.","page_number":197,"box":{"x":225,"y":861,"width":484,"height":12}},{"id":"be9e358e-8be9-4561-8795-fcfea5cac76d","block_type":"box","text":"A-9","page_number":197,"box":{"x":486,"y":909,"width":26,"height":9}},{"id":"4c780d4f-2a82-4300-9f32-66550d465cb8","block_type":"box","text":"NM0926U-5926888-197/257","page_number":197,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"bfee70be-c768-4e21-9df0-a19af657db71","block_type":"box","text":"Within rating categories, Fitch may use modifiers. The modifiers “+” or “-” may be appended to a rating","page_number":198,"box":{"x":116,"y":87,"width":765,"height":12}},{"id":"595b1f3d-fa9d-440d-b3bb-3104ba59c0f4","block_type":"box","text":"to denote relative status within major rating categories.","page_number":198,"box":{"x":116,"y":103,"width":411,"height":12}},{"id":"35255aab-797d-48bf-a15b-f347aa0e6a1b","block_type":"box","text":"For example, the rating category ‘AA’ has three notch-specific rating levels (‘AA+’; ‘AA’; ‘AA–’; each a","page_number":198,"box":{"x":117,"y":134,"width":755,"height":12}},{"id":"d3c2f27b-9f8c-4357-aa4e-1125f9605405","block_type":"box","text":"rating level). Such suffixes are not added to ‘AAA’ ratings and ratings below the ‘CCC’ category. 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Short-term deposit ratings may be adjusted for loss","page_number":198,"box":{"x":116,"y":258,"width":753,"height":12}},{"id":"829b74bf-f6fa-4921-ba5c-04f28410eb20","block_type":"box","text":"severity. Short-term ratings are assigned to obligations whose initial maturity is viewed as “short term”","page_number":198,"box":{"x":116,"y":273,"width":760,"height":12}},{"id":"c0664619-7343-47a3-95a7-195ec18c2894","block_type":"box","text":"based on market convention. Typically, this means up to 13 months for corporate, sovereign, and","page_number":198,"box":{"x":117,"y":289,"width":726,"height":12}},{"id":"5075f798-cbad-416e-a8f7-48ef2cdf07b8","block_type":"box","text":"structured obligations and up to 36 months for obligations in U.S. public finance markets.","page_number":198,"box":{"x":116,"y":304,"width":664,"height":12}},{"id":"d0200246-c721-4854-b0d4-62ee79713701","block_type":"box","text":"Fitch short-term ratings are as follows:","page_number":198,"box":{"x":117,"y":335,"width":289,"height":12}},{"id":"83aa8543-4920-4210-9912-528ba2ac299e","block_type":"box","text":"F1 Highest Short-Term Credit Quality. Indicates the strongest intrinsic capacity for timely","page_number":198,"box":{"x":117,"y":366,"width":746,"height":12}},{"id":"7d20b803-b149-40a5-9ca9-bf4855d11f5c","block_type":"box","text":"payment of financial commitments; may have an added “+” to denote any exceptionally","page_number":198,"box":{"x":226,"y":382,"width":650,"height":12}},{"id":"63fe1628-6008-4b20-9da2-dd891b04c933","block_type":"box","text":"strong credit feature.","page_number":198,"box":{"x":226,"y":397,"width":158,"height":12}},{"id":"e770f6ac-0e13-4cf4-a64f-8f0c487f70a8","block_type":"box","text":"F2 Good Short-Term Credit Quality. Good intrinsic capacity for timely payment of financial","page_number":198,"box":{"x":117,"y":420,"width":757,"height":12}},{"id":"67e8dd0a-9c54-416f-a32e-b35ba778d9fe","block_type":"box","text":"commitments.","page_number":198,"box":{"x":226,"y":436,"width":109,"height":9}},{"id":"1f55f71e-49e4-40d2-8c0f-681fc76e06db","block_type":"box","text":"F3 Fair Short-Term Credit Quality. The intrinsic capacity for timely payment of financial","page_number":198,"box":{"x":117,"y":459,"width":732,"height":12}},{"id":"f0fc9683-23ad-4364-95db-b09dbd14460d","block_type":"box","text":"commitments is adequate.","page_number":198,"box":{"x":226,"y":475,"width":200,"height":12}},{"id":"9ee1de12-1010-42d3-9d1d-5b8b84ffa64f","block_type":"box","text":"B Speculative Short-Term Credit Quality. Minimal capacity for timely payment of financial","page_number":198,"box":{"x":117,"y":498,"width":758,"height":12}},{"id":"dd2e1acc-4430-4d49-ad16-d2bd6690f12c","block_type":"box","text":"commitments, plus heightened vulnerability to near term adverse changes in financial","page_number":198,"box":{"x":226,"y":513,"width":638,"height":12}},{"id":"6d717df1-70a6-40e8-ae79-673449860d3d","block_type":"box","text":"and economic conditions.","page_number":198,"box":{"x":226,"y":529,"width":194,"height":9}},{"id":"c700753b-d89e-425a-8790-e388b516dab2","block_type":"box","text":"C High Short-Term Default Risk. Default is a real possibility.","page_number":198,"box":{"x":117,"y":552,"width":541,"height":12}},{"id":"9b521eba-398d-45fb-bb18-a9ad4971a83a","block_type":"box","text":"RD Restricted Default. 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Indicates a broad-based default event for an entity, or the default of a short","page_number":198,"box":{"x":117,"y":630,"width":733,"height":12}},{"id":"c74a3a9f-3243-486d-ad1c-777756357683","block_type":"box","text":"term obligation.","page_number":198,"box":{"x":225,"y":645,"width":120,"height":12}},{"id":"bd0c0cfe-4090-4f89-8a3e-71d7abbae001","block_type":"box","text":"A-10","page_number":198,"box":{"x":482,"y":909,"width":35,"height":9}},{"id":"15fff206-121e-4e82-827a-bf5d2b4e0bb7","block_type":"box","text":"NM0926U-5926888-198/257","page_number":198,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"09be756d-ca90-4c89-be20-289121b7dd50","block_type":"box","text":"Open-End Active and Fixed Income Index Fund Proxy Voting Policy","page_number":199,"box":{"x":380,"y":87,"width":508,"height":12}},{"id":"5e906dd0-009d-4a04-a46b-d320f7afd274","block_type":"box","text":"APPENDIX 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We aim","page_number":205,"box":{"x":116,"y":620,"width":770,"height":12}},{"id":"0bd6e487-a04d-475b-86a8-0ad5165a8cae","block_type":"box","text":"to build and maintain strong relationships with company leadership based on open dialogue and","page_number":205,"box":{"x":116,"y":635,"width":717,"height":12}},{"id":"3e633234-f2d7-4f50-94eb-30c46333c279","block_type":"box","text":"mutual respect.","page_number":205,"box":{"x":117,"y":651,"width":118,"height":12}},{"id":"547d798c-5006-4dde-8a47-f66ad7f67666","block_type":"box","text":"Different active equity strategies may implement these voting guidelines differently, as a result of the","page_number":205,"box":{"x":117,"y":681,"width":744,"height":12}},{"id":"af63b21c-8806-4eef-a478-72e491f2e4d9","block_type":"box","text":"latitude each portfolio manager has to make independent voting decisions on their holdings. For","page_number":205,"box":{"x":117,"y":697,"width":711,"height":12}},{"id":"ea5bfd86-c0eb-4443-aeff-7c09f9222568","block_type":"box","text":"example, BAIS will generally vote the holdings in Systematic Active Equity portfolios in accordance","page_number":205,"box":{"x":116,"y":712,"width":732,"height":12}},{"id":"63a9d71f-31ad-47f4-91a9-491d00a78ace","block_type":"box","text":"with these guidelines. We provide voting recommendations to fundamental equity portfolio managers,","page_number":205,"box":{"x":116,"y":728,"width":751,"height":12}},{"id":"26d7eb6e-7132-4ec4-a431-7d166d82f283","block_type":"box","text":"who may determine to vote differently based on each portfolio’s investment objectives and strategy.","page_number":205,"box":{"x":116,"y":743,"width":737,"height":12}},{"id":"0bff805e-2ba2-46bc-bc80-087f50575062","block_type":"box","text":"These guidelines discuss BAIS’ views on corporate governance topics on which we may engage with","page_number":205,"box":{"x":116,"y":774,"width":749,"height":12}},{"id":"67e75b89-6b40-4f3e-8a19-c9e655c1cf8e","block_type":"box","text":"management teams and board directors","page_number":205,"box":{"x":117,"y":790,"width":297,"height":12}},{"id":"9dc4388b-580c-46e4-8068-85af455aa5b2","block_type":"box","text":"4","page_number":205,"box":{"x":414,"y":790,"width":6,"height":6}},{"id":"96a1e22f-4c14-4b8e-b049-0e06f4ee7a37","block_type":"box","text":"and on matters that routinely come to a shareholder vote. We","page_number":205,"box":{"x":424,"y":790,"width":456,"height":12}},{"id":"6ba5a6c8-47e9-415a-9707-cd62075bba59","block_type":"box","text":"3","page_number":205,"box":{"x":143,"y":815,"width":4,"height":5}},{"id":"8d176d26-1d9e-4ae0-b323-025f5bf6760c","block_type":"box","text":"On February 11, 2025, the U.S. Securities and Exchange Commission (SEC) staff issued updated guidance for","page_number":205,"box":{"x":170,"y":815,"width":660,"height":9}},{"id":"445a951a-18f6-41f0-a88f-53414bf44bda","block_type":"box","text":"shareholders to maintain their eligibility to report their beneficial ownership under Schedule 13G of the Exchange Act.","page_number":205,"box":{"x":170,"y":828,"width":695,"height":9}},{"id":"2dede33a-580e-4c62-9284-266d923b6dd4","block_type":"box","text":"We comply fully with these requirements and do not engage with portfolio companies for the purpose, or with the effect,","page_number":205,"box":{"x":170,"y":840,"width":707,"height":10}},{"id":"1a9d91e3-a405-4fe0-bb17-8e1b21c47365","block_type":"box","text":"of changing or influencing control of the company.","page_number":205,"box":{"x":170,"y":853,"width":295,"height":10}},{"id":"ca8edb2c-746c-44c8-8396-84dd2d6dac43","block_type":"box","text":"4","page_number":205,"box":{"x":143,"y":866,"width":4,"height":5}},{"id":"9b1479f5-e372-44e5-a324-be3e77b42202","block_type":"box","text":"References to the board, board directors or non-executive directors should be understood to include supervisory boards","page_number":205,"box":{"x":171,"y":866,"width":710,"height":10}},{"id":"618d17f3-e8d9-4f78-a776-d9ce03962773","block_type":"box","text":"and their members, where relevant.","page_number":205,"box":{"x":170,"y":879,"width":210,"height":9}},{"id":"48288d9f-d833-42a3-972d-08f2de95e14d","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":205,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"84e48d5d-88bc-439c-8254-11045be5dd72","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":205,"box":{"x":539,"y":909,"width":324,"height":12}},{"id":"fe94edc9-17d6-47bd-8df8-556c08cdd3cd","block_type":"box","text":"4","page_number":205,"box":{"x":874,"y":909,"width":9,"height":9}},{"id":"a3a48dfc-6d1d-4213-a82f-294e6175e42e","block_type":"box","text":"NM0926U-5926888-205/257","page_number":205,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"fc96d1e3-6e26-471a-9fb8-9e85c07861ac","block_type":"box","text":"recognize that accepted corporate governance norms can differ across markets, and believe these","page_number":206,"box":{"x":117,"y":87,"width":736,"height":12}},{"id":"8c5a5bdb-ce31-45e6-b62f-b3a66f73429b","block_type":"box","text":"guidelines represent globally applicable elements of governance that support a company’s ability to","page_number":206,"box":{"x":116,"y":102,"width":741,"height":13}},{"id":"9c6c9c48-43d1-4181-a8c4-d521bc31daa5","block_type":"box","text":"manage material risks and opportunities and deliver financial returns to investors. Generally, we","page_number":206,"box":{"x":117,"y":118,"width":715,"height":12}},{"id":"b91cc1da-cbe2-4875-8d37-6450fab44628","block_type":"box","text":"believe companies should observe accepted corporate governance norms within their local markets or,","page_number":206,"box":{"x":117,"y":134,"width":768,"height":12}},{"id":"3d64d9de-36e8-4d21-85df-961825130dd8","block_type":"box","text":"particularly in markets without well-established norms, aspire to widely recognized international best","page_number":206,"box":{"x":117,"y":149,"width":746,"height":12}},{"id":"a71ede64-c10d-4b6b-99c6-74ba9f1981e0","block_type":"box","text":"practices. As one of many minority shareholders, BlackRock cannot – and does not try to – direct a","page_number":206,"box":{"x":117,"y":165,"width":739,"height":12}},{"id":"dde18b19-e182-41aa-8135-cb228a23781a","block_type":"box","text":"company’s strategy or its implementation. We look to companies to provide disclosures that explain","page_number":206,"box":{"x":116,"y":180,"width":743,"height":12}},{"id":"8dbeebd1-f974-4e67-b849-63b4c461ee97","block_type":"box","text":"how their approach to corporate governance best aligns with the financial interests of their investors.","page_number":206,"box":{"x":117,"y":196,"width":749,"height":12}},{"id":"8b2e8ecc-8819-469c-b286-b6b5dac3e604","block_type":"box","text":"Our approach to stewardship within active equities","page_number":206,"box":{"x":296,"y":234,"width":412,"height":12}},{"id":"feb31bf1-5826-45f1-a261-9ba163aedf4d","block_type":"box","text":"Voting at a company’s shareholder meeting is a right of share ownership and a core principle of","page_number":206,"box":{"x":116,"y":265,"width":713,"height":12}},{"id":"cc810f37-79af-4c5e-b388-c938af2df4b3","block_type":"box","text":"corporate governance. The voting rights attached to clients’ holdings are an important mechanism for","page_number":206,"box":{"x":116,"y":281,"width":756,"height":12}},{"id":"7e809a25-c404-412a-bf88-2dbeeb7fa22f","block_type":"box","text":"investors to express support for, or concern about, a company’s performance. As a fiduciary,","page_number":206,"box":{"x":117,"y":296,"width":692,"height":12}},{"id":"267d5efb-4ae3-4816-94d3-0b0d9a863972","block_type":"box","text":"BlackRock is legally required to make proxy voting determinations, on behalf of clients who have","page_number":206,"box":{"x":117,"y":312,"width":720,"height":12}},{"id":"5a905c09-9cfa-4228-977b-055462fbbe5b","block_type":"box","text":"delegated voting authority to us, in a manner consistent with BlackRock’s contractual arrangements","page_number":206,"box":{"x":116,"y":327,"width":743,"height":12}},{"id":"163bda99-9edd-4c0f-a901-39acde349d16","block_type":"box","text":"with clients and funds.","page_number":206,"box":{"x":116,"y":343,"width":170,"height":9}},{"id":"d3c16ee3-03eb-4bd3-a351-bd0a12a52cc5","block_type":"box","text":"In general, we tend to support the recommendations of the board of directors and management. As","page_number":206,"box":{"x":117,"y":374,"width":740,"height":12}},{"id":"04a88fe6-92a7-4980-9768-4565af2b9070","block_type":"box","text":"indicated below, we may vote against management recommendations when we have concerns about","page_number":206,"box":{"x":117,"y":389,"width":755,"height":12}},{"id":"dbdea6ea-47d3-4ac3-9355-55ac9b15bc09","block_type":"box","text":"how companies are serving the financial interests of our clients as their shareholders. BAIS takes a","page_number":206,"box":{"x":117,"y":405,"width":740,"height":12}},{"id":"4c4f70d0-5570-45eb-85aa-97a05bcae8be","block_type":"box","text":"globally consistent approach to voting but considers the different corporate governance regulations and","page_number":206,"box":{"x":116,"y":420,"width":772,"height":12}},{"id":"cab3bd35-bc21-4196-8f04-e776ceeabefe","block_type":"box","text":"norms across markets. Votes are determined on a case-by-case basis, in the context of a company’s","page_number":206,"box":{"x":117,"y":436,"width":753,"height":12}},{"id":"4810b094-732e-4097-b6f4-63f18312c4f8","block_type":"box","text":"situation and the investment mandate we have from clients. Please see page 19 for more information","page_number":206,"box":{"x":116,"y":451,"width":756,"height":12}},{"id":"e0d8ff87-80b7-4c4d-94c6-2142444d69be","block_type":"box","text":"about how we fulfill and oversee our investment stewardship responsibilities for BlackRock’s non-index","page_number":206,"box":{"x":116,"y":467,"width":768,"height":12}},{"id":"03346b36-92c2-4c31-80ab-3854988d5978","block_type":"box","text":"equity strategies.","page_number":206,"box":{"x":116,"y":482,"width":125,"height":12}},{"id":"3e52490c-e77f-4f9c-9072-34da36dfa87c","block_type":"box","text":"5","page_number":206,"box":{"x":243,"y":483,"width":6,"height":6}},{"id":"cd96ecf1-16d5-4549-9281-0f7dab4490f1","block_type":"box","text":"Our approach to stewardship within fixed income","page_number":206,"box":{"x":303,"y":521,"width":399,"height":12}},{"id":"815d0690-0710-41c0-b617-8b25f0520a2b","block_type":"box","text":"Although fixed income investors do not have the right to vote at shareholder meetings, issuer","page_number":206,"box":{"x":116,"y":552,"width":695,"height":12}},{"id":"c767cff7-0b88-4f87-8704-de0e08d47953","block_type":"box","text":"engagement is a component of fixed income investment strategies at BlackRock, particularly for those","page_number":206,"box":{"x":116,"y":568,"width":762,"height":12}},{"id":"a68d5fcc-857f-403b-a7f0-bd7a3b2507a9","block_type":"box","text":"with sustainability objectives in addition to financial objectives. Most corporate governance-related","page_number":206,"box":{"x":116,"y":583,"width":732,"height":12}},{"id":"aa96b89b-fd74-4cc5-9860-9c9f309bce60","block_type":"box","text":"fixed income engagements are undertaken in conjunction with the active investment stewardship team,","page_number":206,"box":{"x":116,"y":599,"width":770,"height":12}},{"id":"0c93ddad-28f0-4b15-bcbf-fa3844f53572","block_type":"box","text":"and often active equity investors. In addition to the topics listed below, engagement with fixed income","page_number":206,"box":{"x":116,"y":614,"width":757,"height":12}},{"id":"5b9c6fe8-9fa2-4a09-8e33-0dec1c3ff80c","block_type":"box","text":"investment teams may help inform an issuer’s approach to structuring specialist issuances and the","page_number":206,"box":{"x":117,"y":630,"width":736,"height":12}},{"id":"1427c320-081f-4a22-acda-ecf4fdd06d0d","block_type":"box","text":"standard terms and information in bond documentation.","page_number":206,"box":{"x":116,"y":645,"width":417,"height":10}},{"id":"dffc7045-1913-463e-93b3-2f4940c33dbc","block_type":"box","text":"5","page_number":206,"box":{"x":143,"y":854,"width":4,"height":5}},{"id":"9de5105e-3ac7-4bc2-b0d5-0762bb0385c3","block_type":"box","text":"Non-index equity strategies include active equity holdings in BlackRock’s fundamental equity, systematic equity and","page_number":206,"box":{"x":171,"y":854,"width":685,"height":9}},{"id":"37f262a0-a2e8-484c-86e7-8e7b8004cb8c","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":206,"box":{"x":170,"y":867,"width":678,"height":9}},{"id":"ffab9c16-551e-4580-81ac-02cd2b1b94e3","block_type":"box","text":"extent those strategies hold voting securities or conduct issuer engagements.","page_number":206,"box":{"x":170,"y":880,"width":458,"height":9}},{"id":"4dcf7870-8a30-4a17-8fac-3cbf4ecfe6ab","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":206,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"3b3198cb-1442-47a1-b25f-6b1d7172313d","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":206,"box":{"x":539,"y":909,"width":324,"height":12}},{"id":"c041cc46-4fda-4d7b-b2f2-4ecb4ab31b18","block_type":"box","text":"5","page_number":206,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"5a5f4556-3a7f-48ed-b87b-c1df2a013185","block_type":"box","text":"NM0926U-5926888-206/257","page_number":206,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"96f721d1-84a3-402c-a587-7de5ae942f77","block_type":"box","text":"Boards of Directors","page_number":207,"box":{"x":422,"y":113,"width":161,"height":9}},{"id":"967c225d-6a53-44eb-89a6-0c43548fc013","block_type":"box","text":"Roles and responsibilities","page_number":207,"box":{"x":117,"y":146,"width":212,"height":11}},{"id":"6e3041f4-34bc-4138-8352-005b1f5b3123","block_type":"box","text":"There is widespread consensus that the foundation of good corporate governance is an effective board","page_number":207,"box":{"x":116,"y":178,"width":770,"height":12}},{"id":"fea2db58-c7db-481c-9bbf-eb74f1ce8d16","block_type":"box","text":"of directors that is able to advise and supervise management in an independent and objective","page_number":207,"box":{"x":116,"y":194,"width":700,"height":12}},{"id":"19555ee9-b101-4a84-bbfe-4c0b8302b274","block_type":"box","text":"manner.","page_number":207,"box":{"x":117,"y":212,"width":59,"height":7}},{"id":"86e0a88d-043b-4899-bfe0-beadef45c6c7","block_type":"box","text":"6","page_number":207,"box":{"x":178,"y":209,"width":5,"height":6}},{"id":"fedca569-2f98-4892-bba2-f0d20d4935d4","block_type":"box","text":"We look to the board of directors (hereafter the “board”) to have an oversight role in the establishment","page_number":207,"box":{"x":116,"y":242,"width":762,"height":12}},{"id":"aa34b3d2-ed44-496b-9119-777e27e8a444","block_type":"box","text":"and realization of a company’s strategy, purpose and culture. These constructs are interdependent","page_number":207,"box":{"x":116,"y":257,"width":738,"height":12}},{"id":"6a5e7ef0-1da4-4c6a-a9bc-3a1d042f4f6c","block_type":"box","text":"and, when aligned, can better position a company to be resilient in the face of a changing business","page_number":207,"box":{"x":116,"y":273,"width":739,"height":12}},{"id":"48c09bc8-2fba-445a-9e70-011d5ae9c529","block_type":"box","text":"environment, help reduce the risks of corporate or employee misconduct, and attract and retain the","page_number":207,"box":{"x":116,"y":288,"width":740,"height":12}},{"id":"f8373c39-d8d5-4b20-8f16-a1d6ff388a77","block_type":"box","text":"caliber of workers necessary to deliver financial performance over time.","page_number":207,"box":{"x":116,"y":304,"width":535,"height":12}},{"id":"dd497b89-3102-4e16-ab84-08f3d211842d","block_type":"box","text":"In overseeing the management of the company, the board ensures the necessary resources, policies","page_number":207,"box":{"x":117,"y":337,"width":754,"height":12}},{"id":"adf49ff9-e0a3-49bc-88f1-56fa97df609c","block_type":"box","text":"and procedures are in place to help management meet its strategic objectives within an agreed risk","page_number":207,"box":{"x":116,"y":352,"width":742,"height":12}},{"id":"dc994d01-95b7-48b1-9c29-88f14c772903","block_type":"box","text":"tolerance.","page_number":207,"box":{"x":116,"y":368,"width":78,"height":9}},{"id":"857abe84-f878-40a2-b799-beb9306ab195","block_type":"box","text":"One of the most important responsibilities of the board is to appoint, and remove as necessary, the","page_number":207,"box":{"x":116,"y":400,"width":739,"height":12}},{"id":"da916f2e-22fc-4323-86a4-aa02588c3b90","block_type":"box","text":"chief executive officer (“CEO”). In addition, the board plays a meaningful role in monitoring the","page_number":207,"box":{"x":116,"y":416,"width":704,"height":12}},{"id":"4fac8d1a-c03a-4034-9b54-479da6272a09","block_type":"box","text":"performance of the CEO and other key executives, determining executive compensation, ensuring a","page_number":207,"box":{"x":117,"y":431,"width":747,"height":12}},{"id":"de5553cf-f201-4e2f-8645-493f4449270f","block_type":"box","text":"rigorous audit, overseeing strategy execution and risk management and engaging with shareholders,","page_number":207,"box":{"x":117,"y":447,"width":753,"height":12}},{"id":"a26b05a9-3e97-4e15-bfa2-21e5b66776aa","block_type":"box","text":"and other stakeholders, as necessary.","page_number":207,"box":{"x":116,"y":462,"width":289,"height":12}},{"id":"61def08e-24bd-4e35-88a3-976eb09c429f","block_type":"box","text":"Composition and effectiveness","page_number":207,"box":{"x":116,"y":495,"width":253,"height":12}},{"id":"c21db9a7-05ba-40e5-aabd-1edbf962caeb","block_type":"box","text":"Appointment process","page_number":207,"box":{"x":116,"y":528,"width":177,"height":12}},{"id":"51adb7fe-e6cf-4e9d-bdd8-027c860b53cd","block_type":"box","text":"A formal and transparent process for identifying and appointing director candidates is critical to","page_number":207,"box":{"x":116,"y":560,"width":708,"height":12}},{"id":"22337e2a-a1f5-4f4f-8816-fef9d97a9341","block_type":"box","text":"ensuring the board is composed of directors with the appropriate mix of skills and experience.","page_number":207,"box":{"x":116,"y":576,"width":700,"height":12}},{"id":"49dfa0d0-e224-4190-a354-21c6e5591b04","block_type":"box","text":"Generally, the board or a sub-committee determines the general criteria given the company’s","page_number":207,"box":{"x":117,"y":591,"width":695,"height":12}},{"id":"282c60e5-6ec0-413c-9f93-6298200a8336","block_type":"box","text":"circumstances (e.g., sector, maturity, geographic footprint) and any additional criteria for a specific role","page_number":207,"box":{"x":116,"y":607,"width":767,"height":12}},{"id":"21efedc6-22f9-492c-af03-c08fbda07e86","block_type":"box","text":"being filled (e.g., financial expertise, industry track record). To inform the process, we encourage","page_number":207,"box":{"x":117,"y":622,"width":721,"height":12}},{"id":"6cea048c-2ab0-4a01-b4b3-7b459f210ffc","block_type":"box","text":"companies to review the skills and experience of incumbent directors to identify any gaps and whether","page_number":207,"box":{"x":116,"y":638,"width":764,"height":12}},{"id":"ca0a8f3e-05cb-4d51-b1b7-826d2ac7e636","block_type":"box","text":"the skills and experience of a director candidate would be additive. We welcome disclosures that","page_number":207,"box":{"x":116,"y":653,"width":722,"height":12}},{"id":"06a656a8-ccfd-4bfe-ae2d-d5c1375d5d3d","block_type":"box","text":"explain how the board considered different skills and experience to ensure that the directors","page_number":207,"box":{"x":116,"y":669,"width":682,"height":12}},{"id":"4309e215-2130-42ac-b4af-ef5d52d28499","block_type":"box","text":"collectively can be effective in fulfilling their responsibilities. We assess a company’s board","page_number":207,"box":{"x":116,"y":684,"width":672,"height":12}},{"id":"9662e72a-df6e-4f78-badc-2e056cd46505","block_type":"box","text":"composition against that of its peer group and local market requirements.","page_number":207,"box":{"x":116,"y":700,"width":542,"height":12}},{"id":"3cf1dd88-29a2-49e7-94fc-84c9f2f53d94","block_type":"box","text":"Shareholders periodically vote to elect directors to serve on the board. We do not prescribe any","page_number":207,"box":{"x":116,"y":733,"width":709,"height":12}},{"id":"8ade557f-e2c0-4b39-ad67-115fbbf0552f","block_type":"box","text":"particular board composition in our engagements or voting but seek to understand how well placed a","page_number":207,"box":{"x":117,"y":748,"width":746,"height":12}},{"id":"52fb8ccf-9c80-4b2c-b79c-7b149a3064a2","block_type":"box","text":"board is to act in investors’ interests. We may vote against the election of the most senior independent","page_number":207,"box":{"x":117,"y":764,"width":760,"height":12}},{"id":"4aab46d7-f01e-4060-b860-e0057cdcae64","block_type":"box","text":"director, or the chair of the relevant committee, where a company has not demonstrated it has an","page_number":207,"box":{"x":116,"y":779,"width":720,"height":12}},{"id":"d36eb2f7-cfdd-41f9-9bbc-24abda891428","block_type":"box","text":"appointment process that results in a high functioning board with the appropriate complement of skills","page_number":207,"box":{"x":116,"y":795,"width":753,"height":12}},{"id":"af5e0b93-a68a-46a3-8dbd-891a52c78318","block_type":"box","text":"and experience amongst the directors to support strong financial performance over time. We may vote","page_number":207,"box":{"x":116,"y":810,"width":759,"height":12}},{"id":"5c2b512e-6a1f-4f6c-bc91-5f517588c2e8","block_type":"box","text":"against newly nominated directors who do not seem to have the appropriate skills or experience to","page_number":207,"box":{"x":116,"y":826,"width":736,"height":12}},{"id":"554023fb-ec5d-41ce-8458-29589c9be6b2","block_type":"box","text":"contribute to the board’s effectiveness.","page_number":207,"box":{"x":116,"y":841,"width":293,"height":10}},{"id":"166aaa5a-9b40-4771-a450-3241463b8d15","block_type":"box","text":"6","page_number":207,"box":{"x":143,"y":866,"width":4,"height":5}},{"id":"91b2a1b6-b336-4c98-9a71-168e286de98e","block_type":"box","text":"See the Corporate Governance Codes of Germany, Japan, and the UK, as well as the corporate governance principles","page_number":207,"box":{"x":170,"y":866,"width":706,"height":10}},{"id":"e6413672-4fc5-4511-9d9d-059464705541","block_type":"box","text":"of the US Business Roundtable as examples.","page_number":207,"box":{"x":170,"y":879,"width":268,"height":10}},{"id":"08d4f821-3514-4ebf-befc-d6ff8e755d21","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":207,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"3a9f3304-a499-4fcd-94b9-d72bcc94ea12","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":207,"box":{"x":539,"y":909,"width":324,"height":12}},{"id":"7906f480-c8be-467f-bb97-4cf26ddb364e","block_type":"box","text":"6","page_number":207,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"53dd36c2-5e34-45dd-9b4e-bc13afbe8ea8","block_type":"box","text":"NM0926U-5926888-207/257","page_number":207,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"fe2fd9b2-385c-4571-bc3c-932541ba0622","block_type":"box","text":"Independence","page_number":208,"box":{"x":116,"y":87,"width":118,"height":12}},{"id":"4337086e-38ba-4c21-9a23-6daf11becb89","block_type":"box","text":"Director independence from management, significant shareholders or other stakeholders (e.g.,","page_number":208,"box":{"x":117,"y":116,"width":706,"height":12}},{"id":"c8734018-e2af-42ae-9fbf-507dfdf3e446","block_type":"box","text":"government or employees) is of paramount importance to the protection of the interests of minority","page_number":208,"box":{"x":116,"y":132,"width":736,"height":12}},{"id":"0c5e3430-9eeb-4ddb-ab23-2cdebf1b17e0","block_type":"box","text":"shareholders such as BlackRock’s clients. We consider it good practice for at least half the directors to","page_number":208,"box":{"x":116,"y":147,"width":766,"height":12}},{"id":"2febd560-9a33-40e1-ac82-232c632a18ee","block_type":"box","text":"be independent and free from conflicts of interest or undue influence.","page_number":208,"box":{"x":117,"y":163,"width":510,"height":12}},{"id":"c3d219ff-faad-4a18-8893-e2afb43f60ab","block_type":"box","text":"7","page_number":208,"box":{"x":629,"y":163,"width":5,"height":6}},{"id":"8b062d5e-b61c-490b-bb2b-91c251fc2cb9","block_type":"box","text":"This also helps to ensure that","page_number":208,"box":{"x":635,"y":163,"width":229,"height":12}},{"id":"f5b64c3b-0e83-4813-851c-47615ef9aa4b","block_type":"box","text":"board committees are composed of a sufficient number of independent directors. Companies domiciled","page_number":208,"box":{"x":117,"y":178,"width":770,"height":12}},{"id":"2323cc5c-dcf8-4462-b408-a23f56749d36","block_type":"box","text":"in markets with a higher threshold for board independence should meet those local requirements.","page_number":208,"box":{"x":117,"y":194,"width":727,"height":12}},{"id":"07c0cd49-1a67-4eb0-b48b-6a4e6a0e7134","block_type":"box","text":"We may vote against the election of non-independent directors if the board does not have a sufficient","page_number":208,"box":{"x":116,"y":223,"width":756,"height":12}},{"id":"2205edc3-f3c5-4b71-9546-0e6ba1bae550","block_type":"box","text":"balance of independence. We may also vote against the election of the chair of the committee","page_number":208,"box":{"x":117,"y":239,"width":701,"height":12}},{"id":"b23e5cfa-4912-4ff6-adeb-ff5848d6e7d1","block_type":"box","text":"responsible for board composition if this is a perennial issue.","page_number":208,"box":{"x":117,"y":254,"width":453,"height":12}},{"id":"43391ab3-3dad-44f4-b075-576d291f7fb1","block_type":"box","text":"Independent board leadership","page_number":208,"box":{"x":116,"y":283,"width":245,"height":12}},{"id":"2ac865ac-68fc-49dd-8550-0acd3eaff5b0","block_type":"box","text":"Practices across markets differ, as do board structures, but we observe two main approaches to","page_number":208,"box":{"x":117,"y":312,"width":718,"height":12}},{"id":"2ba48200-dddf-4148-b054-fa5b9853fbc7","block_type":"box","text":"independent board leadership. One is a non-executive, independent chair of the board who is","page_number":208,"box":{"x":117,"y":327,"width":697,"height":12}},{"id":"5d07df10-61c4-4bd2-9722-1ba5ba2f18be","block_type":"box","text":"responsible for leading the board in the effective exercise of its duties. The other is a lead or senior","page_number":208,"box":{"x":117,"y":342,"width":738,"height":12}},{"id":"3218b9fa-f841-4671-a39f-cb99377f5f11","block_type":"box","text":"independent director, who is responsible for coordinating with the other non-executive directors and","page_number":208,"box":{"x":117,"y":357,"width":742,"height":12}},{"id":"5fb301b9-046b-43eb-969a-0f44197cfab4","block_type":"box","text":"working closely with the executive chair on the board agenda and other board procedures. In this case,","page_number":208,"box":{"x":116,"y":372,"width":770,"height":11}},{"id":"2a796e07-63c1-4bd3-8f8e-d365176c9152","block_type":"box","text":"the executive chair and the lead independent director work together to ensure the board is effectively","page_number":208,"box":{"x":116,"y":386,"width":754,"height":12}},{"id":"4faf8bb5-536c-4343-9699-7dddabb30c76","block_type":"box","text":"fulfilling its responsibilities. In our view, the independent leader of the board, and/or the chair of a","page_number":208,"box":{"x":116,"y":401,"width":723,"height":12}},{"id":"801f9264-fccd-462b-ac0b-5beb897f52ed","block_type":"box","text":"relevant committee, should be available to investors to discuss governance matters such as CEO","page_number":208,"box":{"x":117,"y":416,"width":727,"height":12}},{"id":"5d477a29-ca19-483b-b477-3dc755f1031f","block_type":"box","text":"succession, executive pay, and board performance. We look to boards to explain their board","page_number":208,"box":{"x":116,"y":431,"width":691,"height":12}},{"id":"95d66fa0-9156-491c-99db-4851de562266","block_type":"box","text":"leadership model and how it serves the interests of shareholders.","page_number":208,"box":{"x":117,"y":446,"width":489,"height":12}},{"id":"07dbc8f0-6218-417e-bdbd-ec3ce4907d7f","block_type":"box","text":"We may vote against the election of the chair of the committee responsible for board composition if","page_number":208,"box":{"x":116,"y":475,"width":740,"height":12}},{"id":"f3349171-59b4-4eba-8a77-f92722b1655a","block_type":"box","text":"there is not an identified independent leader of the board with clear responsibilities for board","page_number":208,"box":{"x":116,"y":490,"width":689,"height":12}},{"id":"1fd79387-2e6b-420f-8195-ca18fccb44c2","block_type":"box","text":"performance. We may vote against the most senior independent director if the board has a policy of","page_number":208,"box":{"x":117,"y":506,"width":744,"height":12}},{"id":"07715fbe-d1af-46e0-b82f-fbdca2ed4799","block_type":"box","text":"not engaging with shareholders.","page_number":208,"box":{"x":117,"y":522,"width":242,"height":12}},{"id":"9495495a-0003-4ef0-bf4f-2182d3d5aa20","block_type":"box","text":"Tenure and succession","page_number":208,"box":{"x":118,"y":551,"width":189,"height":9}},{"id":"3c8bd4b1-f528-406c-a5e8-ba4969c56362","block_type":"box","text":"In our view, it is good practice for boards to establish the length of time a director would normally be","page_number":208,"box":{"x":117,"y":580,"width":745,"height":12}},{"id":"19a19f0f-a96c-4092-898b-e5c97160c1cc","block_type":"box","text":"expected to serve, in line with market norms where those exist. We find it helpful when companies","page_number":208,"box":{"x":116,"y":595,"width":733,"height":12}},{"id":"648f9a04-3993-4ea3-8d16-0432735c304a","block_type":"box","text":"disclose their approach to director tenure particularly around the contributions of directors who have","page_number":208,"box":{"x":116,"y":611,"width":745,"height":12}},{"id":"9c74ecf9-b335-4907-8d4b-393c423bee3f","block_type":"box","text":"served for longer periods than typically provided for under local practice. In our experience, long","page_number":208,"box":{"x":116,"y":626,"width":718,"height":13}},{"id":"5844d450-a802-419e-8726-c4d17a519e37","block_type":"box","text":"serving directors could become less independent given their long-term relationship with management","page_number":208,"box":{"x":116,"y":642,"width":755,"height":12}},{"id":"af707bbe-7898-4316-b319-e66a281d647f","block_type":"box","text":"and involvement in past board decisions.","page_number":208,"box":{"x":116,"y":658,"width":308,"height":11}},{"id":"88e80b93-81c1-4216-840a-552c271a97b7","block_type":"box","text":"Succession planning for board roles helps achieve the appropriate cadence of turnover that balances","page_number":208,"box":{"x":116,"y":687,"width":750,"height":12}},{"id":"cc5db284-0809-4bad-a769-e92b94a7575f","block_type":"box","text":"renewal through the regular introduction of directors with fresh perspectives and expertise with","page_number":208,"box":{"x":117,"y":702,"width":699,"height":12}},{"id":"b2db5beb-4415-4684-9325-1a83693c5b69","block_type":"box","text":"continuity through the retention of directors with long-term knowledge of the board and company.","page_number":208,"box":{"x":116,"y":718,"width":718,"height":12}},{"id":"a09ed63b-9e83-4920-9801-c87b05b2ab94","block_type":"box","text":"In markets where there is not specific director tenure guidance from regulation or corporate","page_number":208,"box":{"x":117,"y":746,"width":675,"height":12}},{"id":"1688c448-9202-4271-8020-ab74fe455975","block_type":"box","text":"governance best practices, we may vote against the election of the chair of the committee responsible","page_number":208,"box":{"x":116,"y":760,"width":757,"height":12}},{"id":"7ef1613e-e896-4268-bff8-8eed453df5f9","block_type":"box","text":"for board composition if a company does not clearly disclose its approach to director tenure and board","page_number":208,"box":{"x":116,"y":774,"width":757,"height":12}},{"id":"2a70eec6-3391-4283-9ded-9d5a9cc562e0","block_type":"box","text":"renewal. We may vote against the election of directors who have served for more years than is typical","page_number":208,"box":{"x":117,"y":788,"width":754,"height":12}},{"id":"6691a689-871d-4bfd-87fc-a8e4debb6aad","block_type":"box","text":"in markets with specific guidance, where the case for their continued service is not evident.","page_number":208,"box":{"x":117,"y":803,"width":673,"height":12}},{"id":"70f8fbe9-b393-4dfe-8525-61b796927eae","block_type":"box","text":"7","page_number":208,"box":{"x":143,"y":828,"width":4,"height":5}},{"id":"d1593015-c381-478c-bcc5-a45bcc00f5d7","block_type":"box","text":"Common impediments to independence may include but are not limited to: current or recent employment at the","page_number":208,"box":{"x":170,"y":828,"width":659,"height":9}},{"id":"eb1c765f-c016-4edb-95e1-de4cdec47aac","block_type":"box","text":"company or a subsidiary; being, or representing, a shareholder with a substantial shareholding in the company;","page_number":208,"box":{"x":170,"y":841,"width":659,"height":9}},{"id":"a8ef084b-a51b-41ab-b013-12726ae463fd","block_type":"box","text":"interlocking directorships; lengthy tenure, and having any other interest, business, or other relationship which could, or","page_number":208,"box":{"x":170,"y":854,"width":702,"height":9}},{"id":"7791f9c5-dceb-4d1b-b913-3104712ee317","block_type":"box","text":"could reasonably be perceived to, materially interfere with a director’s ability to act in the best interests of the company","page_number":208,"box":{"x":170,"y":866,"width":703,"height":10}},{"id":"84c71345-499a-4497-b862-168632c99fa9","block_type":"box","text":"and shareholders.","page_number":208,"box":{"x":170,"y":880,"width":106,"height":7}},{"id":"5eef1dca-3367-408e-a456-a8cd231a0d94","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":208,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"fce3a97e-5169-413b-a716-00607f53b0f7","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":208,"box":{"x":539,"y":909,"width":324,"height":12}},{"id":"91454a87-f604-4e25-89c7-50ac89c3f26c","block_type":"box","text":"7","page_number":208,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"89d51ced-5f84-4579-893d-4e2e569223c0","block_type":"box","text":"NM0926U-5926888-208/257","page_number":208,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"1b9b3b6b-4d2c-45e3-a173-adcb7eb6d054","block_type":"box","text":"Capacity","page_number":209,"box":{"x":117,"y":87,"width":74,"height":12}},{"id":"29e0b5a1-c7cb-4d59-8d84-29f5713dcfae","block_type":"box","text":"To be effective and engaged, directors need to have the time and energy to commit to the role. In our","page_number":209,"box":{"x":116,"y":118,"width":757,"height":13}},{"id":"1505545e-909c-4f2f-ad53-dd681480ef1d","block_type":"box","text":"view, an effective board will assess the ability of its members to maintain an appropriate focus on","page_number":209,"box":{"x":116,"y":134,"width":726,"height":12}},{"id":"e864de83-d0b1-4628-92d4-aedb346b0649","block_type":"box","text":"board matters and the company taking into consideration competing responsibilities. We recognize that","page_number":209,"box":{"x":117,"y":150,"width":770,"height":12}},{"id":"2a07961a-a9a0-4985-9462-36f5119c2b80","block_type":"box","text":"board leadership roles vary across markets in responsibilities and required time commitment but note","page_number":209,"box":{"x":117,"y":165,"width":756,"height":12}},{"id":"d72c8088-9835-42de-9269-dfde2dab723c","block_type":"box","text":"that they are generally more intensive than a standard directorship. We will take local norms and","page_number":209,"box":{"x":116,"y":181,"width":721,"height":12}},{"id":"2c888e4d-163c-40d3-b9e1-e6f2b9f01510","block_type":"box","text":"practices into consideration when making our voting determinations across markets.","page_number":209,"box":{"x":117,"y":196,"width":628,"height":12}},{"id":"51e011b9-abdb-45a2-af26-9a1f5c533ca8","block_type":"box","text":"We may vote against the election of directors who do not seem to have sufficient capacity to effectively","page_number":209,"box":{"x":116,"y":227,"width":769,"height":13}},{"id":"1c6e9eed-8e06-4cf9-a93d-616b3910044d","block_type":"box","text":"fulfil their duties to the board and company.","page_number":209,"box":{"x":116,"y":243,"width":326,"height":12}},{"id":"480983c1-f02e-462b-a13d-e01049813ed5","block_type":"box","text":"Director elections","page_number":209,"box":{"x":116,"y":275,"width":147,"height":9}},{"id":"ff7b05b3-ffb2-4fbf-95eb-43142fa5a501","block_type":"box","text":"Regular election of directors, ideally annually, supports director accountability to shareholders. A","page_number":209,"box":{"x":117,"y":306,"width":720,"height":12}},{"id":"767c7596-52b0-4b47-ab24-5b9e74681793","block_type":"box","text":"classified board structure","page_number":209,"box":{"x":116,"y":321,"width":186,"height":10}},{"id":"3d4a5bd8-cb75-42ef-a486-30dd09de444f","block_type":"box","text":"8","page_number":209,"box":{"x":303,"y":321,"width":5,"height":7}},{"id":"1c0ec1e6-e995-43c3-a53d-1b86cfee69a7","block_type":"box","text":"may be justified by a company when it needs consistency and stability","page_number":209,"box":{"x":309,"y":321,"width":530,"height":12}},{"id":"9b5decec-1ed0-451a-995c-85c084504bb5","block_type":"box","text":"during a time of transition, or on the basis of its business model (e.g., a non-operating company such","page_number":209,"box":{"x":116,"y":337,"width":754,"height":12}},{"id":"e9fc3c66-0bd3-409e-836e-d0bdc8fca07b","block_type":"box","text":"as closed-end funds).","page_number":209,"box":{"x":116,"y":352,"width":165,"height":12}},{"id":"b7614ffc-8499-4ec3-80a0-b7d66a9b9ce4","block_type":"box","text":"Shareholders should have the opportunity to evaluate nominated directors individually rather than in","page_number":209,"box":{"x":116,"y":384,"width":746,"height":12}},{"id":"cd09648a-8e04-4ae9-90df-1ba463eecae3","block_type":"box","text":"bundled slates. We look to companies to provide sufficient information on each director standing for","page_number":209,"box":{"x":117,"y":399,"width":743,"height":12}},{"id":"20af6bdf-b94e-413f-a966-33f78a9e32d1","block_type":"box","text":"election so that shareholders can assess their capabilities and suitability. We will generally not support","page_number":209,"box":{"x":116,"y":415,"width":765,"height":12}},{"id":"911c4018-8092-4e46-88e2-c934d9996573","block_type":"box","text":"the election of directors whose names and biographical details have not been disclosed sufficiently in","page_number":209,"box":{"x":116,"y":430,"width":755,"height":12}},{"id":"a6644c21-2ed4-4551-b85b-f579363125c4","block_type":"box","text":"advance of the shareholder meeting.","page_number":209,"box":{"x":116,"y":446,"width":278,"height":12}},{"id":"96aba05e-5327-426b-bfd5-7b62740e3272","block_type":"box","text":"Each director’s appointment should be dependent on receiving a simple majority of the votes cast at","page_number":209,"box":{"x":117,"y":477,"width":746,"height":12}},{"id":"20a16f9e-1738-41e0-b55c-8b079cff6c27","block_type":"box","text":"the shareholder meeting. Where a company’s practices differ, we look to the board to provide a","page_number":209,"box":{"x":116,"y":493,"width":712,"height":12}},{"id":"091e61ca-b150-41de-b34d-b16f73ff588e","block_type":"box","text":"detailed explanation as to how its approach best serves investors’ interests.","page_number":209,"box":{"x":116,"y":508,"width":567,"height":12}},{"id":"1b1c8ee8-a54e-4656-b67b-16e952f36cac","block_type":"box","text":"We may vote for shareholder or management proposals seeking to establish annual election of","page_number":209,"box":{"x":116,"y":540,"width":710,"height":12}},{"id":"90c2dfb4-df77-4501-865d-ad493930d22b","block_type":"box","text":"directors and/or a simple majority vote standard for director elections. We may vote against all the","page_number":209,"box":{"x":116,"y":555,"width":732,"height":12}},{"id":"dc8ace50-0793-4478-990e-659e49f4746b","block_type":"box","text":"directors standing for election as part of a single slate if we have concerns about the profile or","page_number":209,"box":{"x":116,"y":571,"width":701,"height":12}},{"id":"4b63d9e3-3cae-4fd1-a246-bfefee952389","block_type":"box","text":"performance of an individual director.","page_number":209,"box":{"x":117,"y":586,"width":280,"height":12}},{"id":"0bb45cbc-49a0-4ee9-975a-34c29f3b677c","block_type":"box","text":"Committees","page_number":209,"box":{"x":117,"y":618,"width":100,"height":9}},{"id":"21f0cdba-f3a7-40b7-87f9-bdaea2dd4fd5","block_type":"box","text":"Many boards establish committees to focus on specific responsibilities of the board such as audit and","page_number":209,"box":{"x":117,"y":649,"width":757,"height":12}},{"id":"b2fafc8e-37ae-4d77-b1f6-e0426aa5cd25","block_type":"box","text":"risk, governance and human capital, and executive compensation, amongst other matters. We do not","page_number":209,"box":{"x":117,"y":665,"width":751,"height":12}},{"id":"ad256507-91e2-4260-9ac4-389545b058be","block_type":"box","text":"prescribe to companies what committees they should establish, but we seek to understand the board’s","page_number":209,"box":{"x":117,"y":680,"width":760,"height":12}},{"id":"638d477f-ef89-4bdf-aede-ccc7f2da0d7c","block_type":"box","text":"rationale for the committee structure it determines is appropriate. We note that, in some markets,","page_number":209,"box":{"x":117,"y":696,"width":717,"height":12}},{"id":"3abb3777-3087-4ec8-8ef4-c4319d7b33b1","block_type":"box","text":"regulation requires such committees. The responsibilities of each committee should be clear, and the","page_number":209,"box":{"x":117,"y":711,"width":748,"height":12}},{"id":"edb69b90-17a3-4a35-a796-bc6e94a1577f","block_type":"box","text":"board should ensure that all critical matters are assigned either to the full board or to one of the","page_number":209,"box":{"x":117,"y":727,"width":706,"height":12}},{"id":"a6255298-8ba4-4b70-8dcb-e3de79bd61b2","block_type":"box","text":"committees. It is helpful to investor understanding when the board discloses the structure,","page_number":209,"box":{"x":116,"y":742,"width":665,"height":12}},{"id":"f91f19a2-9068-4594-a053-d6ad2d656be4","block_type":"box","text":"membership, proportion of independent directors, and responsibilities of each committee. The","page_number":209,"box":{"x":117,"y":758,"width":694,"height":12}},{"id":"d88f26f1-d440-4acf-9cb0-7aeb9ec215a6","block_type":"box","text":"responsibilities we typically see assigned to the three most common committees include:","page_number":209,"box":{"x":117,"y":773,"width":656,"height":12}},{"id":"d8fc8ae8-0186-4e8f-8859-61e0254bbdb6","block_type":"box","text":"• Audit and risk – oversight responsibilities for the integrity of financial reporting, risk management","page_number":209,"box":{"x":117,"y":805,"width":747,"height":12}},{"id":"bf5765c0-896d-4ce1-8f5e-9c59c19c5c43","block_type":"box","text":"and compliance with legal and regulatory requirements; may also play an oversight role in relation","page_number":209,"box":{"x":150,"y":820,"width":725,"height":12}},{"id":"0644b5df-138c-4086-8893-93157b1f499e","block_type":"box","text":"to the internal audit function and whistleblowing mechanisms.","page_number":209,"box":{"x":150,"y":836,"width":460,"height":12}},{"id":"32fe2032-52f6-4b74-87bf-554520646988","block_type":"box","text":"8","page_number":209,"box":{"x":116,"y":862,"width":5,"height":6}},{"id":"9f30c2bf-a580-4676-bca5-a18ccdf8312f","block_type":"box","text":"A classified board divides the directors into classes with different overlapping terms. As a result,","page_number":209,"box":{"x":122,"y":862,"width":744,"height":12}},{"id":"fb2911e6-9a78-4c48-82b0-af103794ef38","block_type":"box","text":"only one class of directors stands for election in any one year.","page_number":209,"box":{"x":150,"y":877,"width":464,"height":12}},{"id":"563a3c17-e3c2-455d-ba8d-386c15248571","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":209,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"c9d89861-bb3b-4896-bad2-17e592e3ea7d","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":209,"box":{"x":539,"y":909,"width":324,"height":12}},{"id":"63081017-0186-4482-8f52-76e277a16742","block_type":"box","text":"8","page_number":209,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"f377e4f1-fab6-4d0f-8a07-c0d755e813d0","block_type":"box","text":"NM0926U-5926888-209/257","page_number":209,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"62c84a8c-d67f-45b8-a379-1df356c1e9fc","block_type":"box","text":"• Nominating, governance and human capital – oversight responsibilities for corporate governance","page_number":210,"box":{"x":117,"y":87,"width":756,"height":12}},{"id":"c9f1f285-eb4b-45cc-a76c-341c6c6bbd96","block_type":"box","text":"principles and practices of the company, including the periodic review of board performance;","page_number":210,"box":{"x":150,"y":102,"width":691,"height":13}},{"id":"98f0fa11-c719-48cd-992e-06a3a9bcd104","block_type":"box","text":"responsibility for succession planning for CEO and key board roles, as well as the director","page_number":210,"box":{"x":150,"y":118,"width":672,"height":12}},{"id":"9976559b-7918-4f22-8f9f-6691fb4070e6","block_type":"box","text":"appointment process; may also have oversight responsibilities for human capital management","page_number":210,"box":{"x":150,"y":134,"width":703,"height":12}},{"id":"ffa682d5-902c-4319-8da9-dd434ef52374","block_type":"box","text":"strategies, including corporate culture and purpose.","page_number":210,"box":{"x":150,"y":149,"width":387,"height":12}},{"id":"d263a060-574a-48e8-afb7-510f9ee04da7","block_type":"box","text":"• Executive compensation – determines the compensation policies and programs for the CEO and","page_number":210,"box":{"x":117,"y":174,"width":755,"height":12}},{"id":"206bafd3-061b-4b82-9d01-6bc59b49b185","block_type":"box","text":"other executive officers, approves annual awards and payments under the policies; may also have","page_number":210,"box":{"x":150,"y":189,"width":735,"height":12}},{"id":"6af9bd70-ec80-45f3-b8d0-f0ee5f0d1cb7","block_type":"box","text":"oversight responsibilities for firm-wide compensation policies.","page_number":210,"box":{"x":150,"y":205,"width":460,"height":12}},{"id":"a56c7c03-d5c4-4aa8-a150-596651b5a199","block_type":"box","text":"We may vote against the election of the chair of the committee or other directors serving as committee","page_number":210,"box":{"x":116,"y":239,"width":765,"height":12}},{"id":"88ec23eb-e662-4d69-b31d-3c1603aa117b","block_type":"box","text":"members to convey concerns about how a committee has undertaken its responsibilities. We may vote","page_number":210,"box":{"x":117,"y":255,"width":767,"height":12}},{"id":"22b9e355-90b1-47ea-a59b-0c03127bb0d7","block_type":"box","text":"against the election of the most senior non-executive director if there is not a clearly disclosed","page_number":210,"box":{"x":116,"y":270,"width":702,"height":12}},{"id":"472de2ab-9ccb-49c8-a27d-d5fef0a2c78c","block_type":"box","text":"approach to board committees.","page_number":210,"box":{"x":116,"y":286,"width":236,"height":11}},{"id":"66220b20-6ac7-43f3-a05c-c0fcb5bbbb73","block_type":"box","text":"Board and director evaluation","page_number":210,"box":{"x":116,"y":320,"width":243,"height":9}},{"id":"e05f0002-2dc0-445b-9e13-f20945869632","block_type":"box","text":"We consider it best practice for companies to conduct an annual review of the performance of the","page_number":210,"box":{"x":116,"y":354,"width":729,"height":12}},{"id":"b3334e8e-6bfd-4112-8ab2-c76c885c7cc4","block_type":"box","text":"board, the committees, the chair and individual directors. Periodically, this review could be undertaken","page_number":210,"box":{"x":117,"y":369,"width":762,"height":12}},{"id":"f37638d0-31db-4ada-9fae-5a03517c5518","block_type":"box","text":"by an independent third party able to bring objective perspectives to the board on governance and","page_number":210,"box":{"x":117,"y":385,"width":732,"height":12}},{"id":"b48a9851-57d8-4a32-a45b-2698f86817fd","block_type":"box","text":"performance. We encourage companies to disclose their approach to and the objectives of","page_number":210,"box":{"x":117,"y":400,"width":677,"height":12}},{"id":"e321584f-04e5-4a38-95c6-b2d74ab98700","block_type":"box","text":"evaluations, including any changes made to the board’s approach as a result.","page_number":210,"box":{"x":116,"y":416,"width":581,"height":12}},{"id":"1a956de4-3182-4717-b468-8bf47660c1e9","block_type":"box","text":"Access to independent advice","page_number":210,"box":{"x":116,"y":450,"width":246,"height":12}},{"id":"e18a77e6-ca7f-4d1e-85f4-3fca49939a43","block_type":"box","text":"To support the directors in effectively fulfilling their duties to the company and shareholders, they","page_number":210,"box":{"x":116,"y":484,"width":723,"height":12}},{"id":"658484ed-ae26-4f3a-ad91-0aace80f49b4","block_type":"box","text":"should have access to independent advice. In certain circumstances, it may be helpful to boards to","page_number":210,"box":{"x":116,"y":499,"width":738,"height":13}},{"id":"3a45c158-27c0-421a-a15a-3e2de3105772","block_type":"box","text":"retain independent third parties to advise on critical matters. These might include new industry","page_number":210,"box":{"x":117,"y":515,"width":703,"height":12}},{"id":"144361db-26be-48a2-9548-d5cbda136e03","block_type":"box","text":"developments such as emergent and disruptive technology, operating events with material","page_number":210,"box":{"x":116,"y":531,"width":676,"height":12}},{"id":"a8571779-9874-4c28-9a14-a74afaf29c62","block_type":"box","text":"consequences for the company’s reputation and/or performance, or significant transactions. Board","page_number":210,"box":{"x":116,"y":546,"width":735,"height":12}},{"id":"1efc64c0-9fed-40d2-9d03-442179b7830b","block_type":"box","text":"committees may similarly retain third parties to advise them on specialist matters such as audit,","page_number":210,"box":{"x":116,"y":562,"width":713,"height":12}},{"id":"0f29354c-1ffa-43ce-a424-a175f2ebd083","block_type":"box","text":"compensation and succession planning.","page_number":210,"box":{"x":116,"y":577,"width":303,"height":12}},{"id":"2c2d1ce6-a51d-405f-9750-ff098c323fff","block_type":"box","text":"Executive compensation","page_number":210,"box":{"x":402,"y":620,"width":201,"height":12}},{"id":"011f7829-a9d5-48a3-81c7-3c80ce8e3a69","block_type":"box","text":"Boards play an important role in establishing compensation arrangements that enable the company to","page_number":210,"box":{"x":117,"y":655,"width":760,"height":12}},{"id":"134e2775-fe93-43b5-94e7-884f1f304c18","block_type":"box","text":"recruit, retain and reward the caliber of executive management necessary to lead and operate the","page_number":210,"box":{"x":117,"y":670,"width":724,"height":12}},{"id":"52f94148-dbc0-4ced-bcb2-25ca89d96735","block_type":"box","text":"company to deliver superior financial returns over time. We focus on alignment between variable pay","page_number":210,"box":{"x":116,"y":685,"width":748,"height":13}},{"id":"3dcbf47d-b80f-4e85-8730-1e4bf458c255","block_type":"box","text":"and a company’s financial performance.","page_number":210,"box":{"x":116,"y":701,"width":296,"height":12}},{"id":"7ea5eaf3-ecbd-4ff2-ad29-587562301cbc","block_type":"box","text":"Generally, executive compensation arrangements have four components: base salary, annual bonus","page_number":210,"box":{"x":117,"y":735,"width":746,"height":12}},{"id":"75b79432-5e2e-44a7-847e-f4a8d85a564e","block_type":"box","text":"that rewards performance against short-term metrics, incentives—most often share-based- that reward","page_number":210,"box":{"x":116,"y":751,"width":762,"height":12}},{"id":"b7a552ae-d4e1-45c5-9d9f-fbb840f6781b","block_type":"box","text":"performance against long-term metrics, and pensions and benefits. In our observation, base salary,","page_number":210,"box":{"x":117,"y":766,"width":736,"height":12}},{"id":"c59cf52c-264c-442d-b186-d703b2b1da78","block_type":"box","text":"pensions and benefits are largely set relative to market norms and benchmarks. The annual bonus and","page_number":210,"box":{"x":117,"y":782,"width":763,"height":12}},{"id":"d0a8988b-63a7-4cf4-80ee-2af7fe4d8ec8","block_type":"box","text":"share-based incentive, or variable pay plans, tend to be tailored to the company, its sector and long","page_number":210,"box":{"x":116,"y":797,"width":744,"height":12}},{"id":"97de8f24-1a59-46c5-ab2d-8a5bb80a3584","block_type":"box","text":"term strategy, as well as the individuals the board is seeking to recruit and motivate.","page_number":210,"box":{"x":116,"y":813,"width":622,"height":12}},{"id":"a8d722ce-1548-4e27-b9d2-0d3dae9eb6ea","block_type":"box","text":"Recognizing the unique circumstances of each company, we determine whether to support a","page_number":210,"box":{"x":117,"y":847,"width":693,"height":12}},{"id":"c3450595-6d2b-4b21-8903-37dda6c05ccd","block_type":"box","text":"company’s approach to executive compensation on a case-by-case basis. We rely on companies","page_number":210,"box":{"x":116,"y":862,"width":726,"height":12}},{"id":"6d7de43a-2474-4e38-9237-aff3b588cfea","block_type":"box","text":"providing sufficient quantitative and qualitative information in their disclosures to enable shareholders","page_number":210,"box":{"x":117,"y":878,"width":754,"height":12}},{"id":"f77e7802-d9ee-4ecd-841a-631cee84a401","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":210,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"cec3f584-a11e-4efb-9019-994ccd0c5bbf","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":210,"box":{"x":539,"y":909,"width":324,"height":12}},{"id":"cf6afcb5-0877-406c-97b5-e9e4d70be187","block_type":"box","text":"9","page_number":210,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"bc1af957-091f-43d5-8dd2-359660aa1bcd","block_type":"box","text":"NM0926U-5926888-210/257","page_number":210,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"457d299d-51fd-4950-a025-ea524d35c615","block_type":"box","text":"to understand the compensation arrangements and assess the alignment with investors’ interests.","page_number":211,"box":{"x":116,"y":87,"width":732,"height":12}},{"id":"44a6984f-9c78-4b39-9985-7029427246c0","block_type":"box","text":"Features we look for in compensation arrangements include:","page_number":211,"box":{"x":117,"y":102,"width":454,"height":13}},{"id":"4fe92f67-ed7e-4a30-a26b-fdd5be25bb62","block_type":"box","text":"• Fixed pay components, including base salary, benefits and prerequisites that are appropriate in","page_number":211,"box":{"x":117,"y":133,"width":744,"height":12}},{"id":"42070948-752c-4219-a174-7e0a545454fb","block_type":"box","text":"the context of the company’s size, sector and market.","page_number":211,"box":{"x":150,"y":148,"width":402,"height":12}},{"id":"f2a8f4f0-5d5d-4a35-9a2b-0519f246ffe4","block_type":"box","text":"• Variable pay subject to performance metrics that are closely linked to the company’s short- and","page_number":211,"box":{"x":117,"y":171,"width":745,"height":12}},{"id":"6874b6bc-e3c1-40a3-ac9b-e685822f7c25","block_type":"box","text":"long-term strategic objectives.","page_number":211,"box":{"x":150,"y":187,"width":228,"height":12}},{"id":"4e305bf5-f479-442d-bda2-655c4b2a9499","block_type":"box","text":"• Long-term incentives that motivate sustained performance across a multi-year period.","page_number":211,"box":{"x":117,"y":210,"width":674,"height":12}},{"id":"6b7668ce-190f-45fb-a881-91ce81530f5e","block_type":"box","text":"• A balance between fixed and variable pay, short- and long-term incentives, and specific","page_number":211,"box":{"x":117,"y":233,"width":687,"height":12}},{"id":"97d1d0a2-37f2-4bea-91cf-4a2309b1d6e6","block_type":"box","text":"instruments (cash and equity awards) that promotes pay program durability and seldom","page_number":211,"box":{"x":150,"y":248,"width":654,"height":12}},{"id":"98db5087-e64a-4df5-b301-7fb450bda527","block_type":"box","text":"necessitates one-off, discretionary payments.","page_number":211,"box":{"x":150,"y":264,"width":342,"height":12}},{"id":"52342f8b-2d75-4a52-828b-944536025dc4","block_type":"box","text":"• Pay outcomes that are consistent with the returns to investors over the relevant time period.","page_number":211,"box":{"x":117,"y":287,"width":720,"height":12}},{"id":"b656d04b-1fd5-4c54-8667-cccfb6a7d553","block_type":"box","text":"• Board discretion, if allowed within the variable pay arrangements, to be used sparingly,","page_number":211,"box":{"x":117,"y":310,"width":683,"height":12}},{"id":"10ac999b-67c7-4a1d-a035-6a0600e0c004","block_type":"box","text":"responsibly and transparently.","page_number":211,"box":{"x":150,"y":325,"width":228,"height":12}},{"id":"f90bf8c0-1076-4db0-b34b-c2c0e902cef1","block_type":"box","text":"• A requirement, that participants in long-term share-based incentive plans build a meaningful","page_number":211,"box":{"x":117,"y":348,"width":720,"height":12}},{"id":"e4949a83-62b3-4f44-a2d7-e79e221ec4dc","block_type":"box","text":"shareholding in the company within a defined time period, as determined by the board or relevant","page_number":211,"box":{"x":150,"y":363,"width":727,"height":13}},{"id":"db34ef94-d5de-409c-904b-e08209b7c345","block_type":"box","text":"board committee.","page_number":211,"box":{"x":150,"y":379,"width":134,"height":10}},{"id":"3120d2de-c0c2-449d-bac9-0df96d8136e5","block_type":"box","text":"• Change of control provisions that appropriately balance the interests of executives and","page_number":211,"box":{"x":117,"y":402,"width":681,"height":12}},{"id":"7c157b87-2eb1-4b1d-894d-defc9070f1dc","block_type":"box","text":"shareholders.","page_number":211,"box":{"x":150,"y":418,"width":106,"height":9}},{"id":"35aba284-9920-4974-9909-129f84469eed","block_type":"box","text":"• Clawback or malus provisions that allow the company to recoup or hold back variable","page_number":211,"box":{"x":117,"y":440,"width":671,"height":12}},{"id":"33ff2707-c843-4bad-bc80-53ca5e6fc94c","block_type":"box","text":"compensation from individuals whose awards were based on fraudulent activities, misstated","page_number":211,"box":{"x":150,"y":456,"width":688,"height":12}},{"id":"dfe188c6-6c79-4eb3-985e-f9627e1ca0c0","block_type":"box","text":"financial reports, or executive misconduct.","page_number":211,"box":{"x":149,"y":471,"width":318,"height":12}},{"id":"215ad61f-c0f7-41c5-87a6-f71b27db9f25","block_type":"box","text":"• Severance arrangements that protect the company’s interests but do not cost more than is","page_number":211,"box":{"x":117,"y":494,"width":709,"height":12}},{"id":"5248c812-e2b9-4794-8c76-9f3728835e4f","block_type":"box","text":"contractual.","page_number":211,"box":{"x":150,"y":510,"width":91,"height":9}},{"id":"f3b78a67-ce29-4fb4-958c-ffa49a4b4191","block_type":"box","text":"We may vote against proposals to introduce new share-based incentives, approve existing policies or","page_number":211,"box":{"x":116,"y":540,"width":757,"height":12}},{"id":"826b6911-530e-4913-b5a3-93faa06c7d56","block_type":"box","text":"plans, or approve the compensation report where we do not see alignment between executive","page_number":211,"box":{"x":117,"y":556,"width":701,"height":12}},{"id":"9c406651-b8df-471a-886c-142aa35264f2","block_type":"box","text":"compensation arrangements and our clients’ financial interests. When there is not an alternative, or","page_number":211,"box":{"x":116,"y":571,"width":742,"height":12}},{"id":"a2d58d9f-50cf-4a9f-ac9e-d80165089276","block_type":"box","text":"where there have been multi-year issues with compensation misaligned with performance, we may","page_number":211,"box":{"x":116,"y":587,"width":738,"height":12}},{"id":"3ab48235-e587-4202-81a8-405cb04b6327","block_type":"box","text":"vote against the election of the chair of the responsible committee, or the most senior independent","page_number":211,"box":{"x":116,"y":602,"width":735,"height":12}},{"id":"2a9e7237-ffb8-4b1f-b2a3-5b5972d77a6e","block_type":"box","text":"director.","page_number":211,"box":{"x":116,"y":618,"width":65,"height":9}},{"id":"f0c1afc2-6639-4ba3-8161-de52f1825e00","block_type":"box","text":"Non-executive director compensation","page_number":211,"box":{"x":350,"y":656,"width":305,"height":11}},{"id":"5631f820-f916-4c74-8071-ccbb12819493","block_type":"box","text":"Companies generally pay non-executive directors an annual retainer or fee in cash, shares or a","page_number":211,"box":{"x":117,"y":686,"width":706,"height":12}},{"id":"9b6e98ee-605f-4646-8a06-245d9393bd30","block_type":"box","text":"combination of the two. Some companies also pay additional fees for service on board committees or","page_number":211,"box":{"x":116,"y":701,"width":752,"height":12}},{"id":"98c89f44-cd88-46fc-bef0-12bf4bac5cb0","block_type":"box","text":"in board leadership roles. We do not support non-executive directors participating in performance","page_number":211,"box":{"x":117,"y":717,"width":726,"height":12}},{"id":"85dcb5ee-ec5e-463d-b8c2-f1d42d42f204","block_type":"box","text":"based incentive plans as doing so may create a conflict of interest and undermine their independence","page_number":211,"box":{"x":117,"y":732,"width":753,"height":12}},{"id":"783b6fa3-63ef-4630-9dd0-ce67e4934e43","block_type":"box","text":"from management, whom they oversee.","page_number":211,"box":{"x":116,"y":748,"width":295,"height":12}},{"id":"1e6e27bd-8b67-4b00-82b0-e6ce1a2315dc","block_type":"box","text":"Capital structure","page_number":211,"box":{"x":433,"y":786,"width":133,"height":12}},{"id":"c33133f3-437a-4afd-9b56-aa441ba9e67f","block_type":"box","text":"Boards are responsible for ensuring senior executive leadership has established a capital strategy that","page_number":211,"box":{"x":117,"y":816,"width":760,"height":12}},{"id":"623af560-ce32-4650-b9a7-a66fa953139a","block_type":"box","text":"achieves appropriate capital allocation in support of long-term financial resilience.","page_number":211,"box":{"x":116,"y":832,"width":610,"height":12}},{"id":"78e8eaee-487b-4195-8b7e-ada7fdb04303","block_type":"box","text":"Where company practices diverge from those set out below, we look for companies to disclose why","page_number":211,"box":{"x":116,"y":862,"width":743,"height":12}},{"id":"4d5f37f1-d46b-42d6-938b-8d079dd18fd3","block_type":"box","text":"they view these practices to be aligned with shareholders’ interests. We may vote against management","page_number":211,"box":{"x":116,"y":878,"width":772,"height":11}},{"id":"e3f7168e-092e-4e97-9661-ca1330f11136","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":211,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"8457eb70-ce12-428a-968c-496c99f7da19","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":211,"box":{"x":530,"y":909,"width":324,"height":12}},{"id":"b93a0eb4-367b-461b-b820-564a7df60001","block_type":"box","text":"10","page_number":211,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"a0791be2-2204-47ac-ba86-f257ef8f0df5","block_type":"box","text":"NM0926U-5926888-211/257","page_number":211,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"b77791c7-c0e1-45d1-a58e-4d50fa4bb05f","block_type":"box","text":"proposals seeking capital-related authorities, or the election of the most senior independent director, if","page_number":212,"box":{"x":117,"y":87,"width":761,"height":12}},{"id":"f382fde3-613a-410a-a6ac-5b2f00f0d4d8","block_type":"box","text":"we have concerns about a company’s approach. We may also support a shareholder proposal seeking","page_number":212,"box":{"x":116,"y":103,"width":768,"height":12}},{"id":"cdea0a02-5341-445c-8e58-5313197fba63","block_type":"box","text":"conversion of shares with differentiated voting rights to a one-share, one-vote standard.","page_number":212,"box":{"x":116,"y":118,"width":655,"height":12}},{"id":"3a5cec4d-3616-43f2-8790-80a390c705eb","block_type":"box","text":"Share","page_number":212,"box":{"x":116,"y":148,"width":46,"height":10}},{"id":"2a9b8f82-3c9d-4a94-ba90-827d44649733","block_type":"box","text":"issuance","page_number":212,"box":{"x":168,"y":149,"width":76,"height":9}},{"id":"4a96b66a-f648-44a8-9e9a-aa7a89b19e1f","block_type":"box","text":"We assess requests for share issuance for particular transactions on a case-by-case basis. We will","page_number":212,"box":{"x":116,"y":179,"width":741,"height":12}},{"id":"ee9c3b9e-4f9e-4e3c-9e09-063be934f677","block_type":"box","text":"generally support authorities to issue shares when subject to pre-emptive rights, and up to 20% absent","page_number":212,"box":{"x":116,"y":194,"width":768,"height":12}},{"id":"fc5a1053-f41a-449a-8e1c-f860e66e48e2","block_type":"box","text":"pre-emptive rights. We consider it good practice for companies to seek regular approval of these","page_number":212,"box":{"x":117,"y":210,"width":720,"height":12}},{"id":"ed1a063d-6787-47e5-aaa8-2c45a6ca0573","block_type":"box","text":"authorities to allow shareholders to take into consideration how prior authorities were used, as well as","page_number":212,"box":{"x":116,"y":226,"width":759,"height":11}},{"id":"61f40bb6-0b55-4688-9f9d-7b09fcb1c1f2","block_type":"box","text":"the current circumstances of the company and the market environment.","page_number":212,"box":{"x":116,"y":241,"width":536,"height":12}},{"id":"aeb35342-7dc0-443d-b1d3-7cfc528bbec8","block_type":"box","text":"Share buybacks","page_number":212,"box":{"x":116,"y":271,"width":133,"height":12}},{"id":"5105357d-2dac-4519-9c70-48717cbad82e","block_type":"box","text":"We assess share buyback proposals in the context of the company’s disclosed capital management","page_number":212,"box":{"x":116,"y":302,"width":746,"height":12}},{"id":"085a1374-6892-469f-90a1-1a5f928d42eb","block_type":"box","text":"strategy and management’s determination of the appropriate balance between investment that","page_number":212,"box":{"x":116,"y":317,"width":706,"height":12}},{"id":"1a8d652f-e19a-4a37-b7d7-24a69cc8d953","block_type":"box","text":"supports the long-term growth of the company and returning cash to investors. We also take into","page_number":212,"box":{"x":116,"y":333,"width":721,"height":12}},{"id":"365ab825-9e54-45b1-8e44-cc42c27e6115","block_type":"box","text":"consideration the effect of a buyback program on the company’s balance sheet and executive","page_number":212,"box":{"x":116,"y":348,"width":701,"height":12}},{"id":"afe53ba5-ab07-4972-b87a-d256a7a06ed3","block_type":"box","text":"compensation arrangements and the price at which shares are repurchased relative to market price.","page_number":212,"box":{"x":116,"y":364,"width":748,"height":12}},{"id":"12a4e931-1735-4b01-826b-9264269fa894","block_type":"box","text":"We consider it good practice for companies to seek regular approval of these authorities to allow","page_number":212,"box":{"x":116,"y":379,"width":721,"height":12}},{"id":"56bb375c-edd8-4667-acb7-da5989767be8","block_type":"box","text":"shareholders to take into consideration how prior authorities were used, as well as the current","page_number":212,"box":{"x":116,"y":395,"width":700,"height":12}},{"id":"e9370f88-ecf7-452a-94c6-1a2bbcf3978b","block_type":"box","text":"circumstances of the company and the market environment.","page_number":212,"box":{"x":116,"y":410,"width":451,"height":12}},{"id":"c2df85aa-3a30-4973-af68-c5ca7529b3ed","block_type":"box","text":"Dividends","page_number":212,"box":{"x":117,"y":441,"width":84,"height":9}},{"id":"45de2738-a8ba-4bb2-892b-b6459ebc22eb","block_type":"box","text":"We generally defer to management and the board on dividend policy but may engage to seek further","page_number":212,"box":{"x":116,"y":471,"width":752,"height":12}},{"id":"711958ba-acc2-4ff0-a954-f994a5075c48","block_type":"box","text":"clarification where a proposed dividend appears out of line with the company’s financial position.","page_number":212,"box":{"x":116,"y":487,"width":720,"height":12}},{"id":"9c248e49-772e-4f02-94c4-5555506a5fec","block_type":"box","text":"Differentiated voting rights","page_number":212,"box":{"x":117,"y":517,"width":219,"height":12}},{"id":"bb88e706-d427-45ab-9c35-a53d8028454b","block_type":"box","text":"We prefer companies to adopt a one-share, one-vote structure for share classes with the same","page_number":212,"box":{"x":116,"y":547,"width":710,"height":12}},{"id":"e3ac33d3-947d-4546-92db-82c44897c14b","block_type":"box","text":"economic exposure. Certain companies, particularly those new to public markets, could make the case","page_number":212,"box":{"x":116,"y":563,"width":768,"height":12}},{"id":"cbb003d6-28eb-4ee1-a5e1-803b4daa9933","block_type":"box","text":"to adopt a differentiated voting rights structure, or dual class stock. In those situations, we encourage","page_number":212,"box":{"x":116,"y":578,"width":755,"height":13}},{"id":"1d6cea78-96e7-4c86-acd4-6191989e5924","block_type":"box","text":"companies to evaluate and seek approval for their capital structure on a periodic basis.","page_number":212,"box":{"x":116,"y":594,"width":650,"height":12}},{"id":"0e714d60-778d-4df7-98a9-fd18e04c06e8","block_type":"box","text":"Transactions and special situations","page_number":212,"box":{"x":357,"y":632,"width":290,"height":12}},{"id":"07f82364-6005-4dec-8f9b-5656f385d92e","block_type":"box","text":"We monitor developments in transactions and special situations closely and undertake our own","page_number":212,"box":{"x":116,"y":662,"width":706,"height":12}},{"id":"69618a63-b7e2-4cb5-9074-73e3cb5de943","block_type":"box","text":"detailed analyses of proposals.","page_number":212,"box":{"x":116,"y":678,"width":229,"height":12}},{"id":"d38e19d3-5fed-44c6-a35e-5fb7dcaf6b38","block_type":"box","text":"Mergers and acquisitions","page_number":212,"box":{"x":117,"y":708,"width":201,"height":12}},{"id":"4ad236ea-422a-46a9-9990-686612a0a055","block_type":"box","text":"We evaluate proposed mergers or acquisitions by assessing the financial outcome for our clients as","page_number":212,"box":{"x":116,"y":739,"width":740,"height":12}},{"id":"f7c9f80e-898c-487b-9a89-c6810dfbc806","block_type":"box","text":"minority shareholders. Management should provide an assessment of the proposed transaction’s","page_number":212,"box":{"x":117,"y":754,"width":719,"height":12}},{"id":"6f78fac8-74e1-4cf6-bfdf-cd34ba9c28c5","block_type":"box","text":"strategic and financial rationale, along with its execution and operational risks. We review each","page_number":212,"box":{"x":116,"y":770,"width":703,"height":12}},{"id":"cd9f05dc-7c57-4510-94ef-485e2dc90261","block_type":"box","text":"transaction independently based on these factors and the degree to which the transaction enhances","page_number":212,"box":{"x":116,"y":785,"width":743,"height":12}},{"id":"f574e514-e331-485b-b6cb-82026b50010d","block_type":"box","text":"shareholder value. The board might consider establishing an ad hoc transaction committee to","page_number":212,"box":{"x":116,"y":801,"width":693,"height":12}},{"id":"9e5fa85f-901c-4768-be8d-b3cc5400f9ef","block_type":"box","text":"undertake an independent assessment of a significant merger or acquisition, in advance of making its","page_number":212,"box":{"x":117,"y":816,"width":752,"height":12}},{"id":"94998711-54b4-4771-b602-90e8e87cdb58","block_type":"box","text":"recommendation to shareholders.","page_number":212,"box":{"x":117,"y":832,"width":254,"height":9}},{"id":"b61f12c9-bf3e-421a-a175-b32c61e09f98","block_type":"box","text":"We will vote against transactions that, in our assessment, do not advance our clients’ financial","page_number":212,"box":{"x":116,"y":862,"width":703,"height":12}},{"id":"ca9ae9bc-cc3d-4030-b17d-a8eabf7e890d","block_type":"box","text":"interests.","page_number":212,"box":{"x":117,"y":878,"width":72,"height":9}},{"id":"9ce37b49-904a-4166-a094-796787c9f16a","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":212,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"46974ef7-df16-4192-a83a-df927393f094","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":212,"box":{"x":530,"y":909,"width":324,"height":12}},{"id":"d5054cc6-7f90-48c3-a0c1-ffad7269768f","block_type":"box","text":"11","page_number":212,"box":{"x":866,"y":909,"width":15,"height":9}},{"id":"9391becc-4652-4148-8407-8f6425719ecd","block_type":"box","text":"NM0926U-5926888-212/257","page_number":212,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"5fe321d0-518a-4ff9-8785-41f4121eb0fb","block_type":"box","text":"Anti-takeover defenses","page_number":213,"box":{"x":116,"y":87,"width":190,"height":10}},{"id":"168ed06f-c7d7-4375-a6ab-a33f4af287d2","block_type":"box","text":"In principle, we do not support companies using anti-takeover defenses, also known as poison pills or","page_number":213,"box":{"x":117,"y":119,"width":757,"height":12}},{"id":"b93d871d-2881-4e1a-878a-a4893b6914ac","block_type":"box","text":"shareholder rights plans, as they can entrench management and boards which have not delivered","page_number":213,"box":{"x":116,"y":134,"width":731,"height":12}},{"id":"873e4d8f-326a-422b-ad59-ee9a718405ea","block_type":"box","text":"long-term shareholder value. By exception, a poison pill may be supported if its purpose is to delay a","page_number":213,"box":{"x":117,"y":150,"width":751,"height":12}},{"id":"5462aef0-f063-4bf6-aa18-ea18e491e852","block_type":"box","text":"takeover that is considered sub-optimal and enable management to seek an improved offer. Similarly,","page_number":213,"box":{"x":116,"y":165,"width":761,"height":12}},{"id":"a9fd15c9-4917-4524-bafe-56a560eca7d7","block_type":"box","text":"management could make the case to use a poison pill to block a shareholder activism campaign that","page_number":213,"box":{"x":117,"y":181,"width":751,"height":12}},{"id":"2b601306-b433-480c-8b78-b9880c32e335","block_type":"box","text":"may be counter to the interests of other investors. Defense mechanisms introduced in these","page_number":213,"box":{"x":117,"y":196,"width":687,"height":12}},{"id":"544256f6-ab3c-4672-9ad5-0912ae327218","block_type":"box","text":"circumstances should be limited in term and threshold, and also be closely monitored by the","page_number":213,"box":{"x":116,"y":212,"width":688,"height":12}},{"id":"5b38b5fc-aa15-4b4e-9996-dfbe0ebac853","block_type":"box","text":"independent members of the board. We consider it good practice for companies to put to a shareholder","page_number":213,"box":{"x":117,"y":227,"width":771,"height":12}},{"id":"c0832aca-7b94-4c1f-b51b-9b6443409ee0","block_type":"box","text":"vote any mechanisms expected to be in place for more than 12 months.","page_number":213,"box":{"x":116,"y":243,"width":538,"height":12}},{"id":"f0085696-6139-4c9d-84dd-e41f547f6ea8","block_type":"box","text":"Shareholder activism","page_number":213,"box":{"x":116,"y":274,"width":175,"height":10}},{"id":"16caf1a1-1863-4a28-8019-89217be0d5f6","block_type":"box","text":"When companies are the focus of an activism campaign, we may communicate with the activist to","page_number":213,"box":{"x":116,"y":306,"width":732,"height":12}},{"id":"2c8bac36-2275-492a-a27c-ccdd237579ca","block_type":"box","text":"understand their analysis and objectives, once they have publicly disclosed their campaign. We may","page_number":213,"box":{"x":117,"y":322,"width":748,"height":12}},{"id":"d5615556-312e-41ab-a6a2-d825455d7051","block_type":"box","text":"also engage with company management and possibly board members, especially those the activist","page_number":213,"box":{"x":116,"y":337,"width":741,"height":12}},{"id":"1920d836-c676-4425-9c95-49888e6cea1b","block_type":"box","text":"may be seeking to replace. In our assessment, we evaluate various factors, including the concerns","page_number":213,"box":{"x":117,"y":353,"width":737,"height":12}},{"id":"e2fa61e7-6056-4489-a98c-a9c95c63b5de","block_type":"box","text":"raised by the activist and the case for change; the quality of both the activist’s and management’s","page_number":213,"box":{"x":117,"y":368,"width":728,"height":12}},{"id":"d23741e8-8344-41ed-9e86-800763753876","block_type":"box","text":"plans; and the qualifications of each party’s candidates. We evaluate each contested situation by","page_number":213,"box":{"x":117,"y":384,"width":723,"height":12}},{"id":"7e47df2d-658a-42d7-b0eb-ef752f89bd91","block_type":"box","text":"assessing the potential financial outcome for our clients as minority shareholders.","page_number":213,"box":{"x":116,"y":399,"width":610,"height":12}},{"id":"d0415c1a-2039-468a-ad6a-3744e0eddfbd","block_type":"box","text":"We may support board candidates nominated by a shareholder activist if BAIS, in its independent","page_number":213,"box":{"x":116,"y":431,"width":728,"height":12}},{"id":"401fabc7-fb58-4794-8ec4-cc1f1b1e9882","block_type":"box","text":"judgment, or the relevant portfolio manager has determined that there is a case for change to enhance","page_number":213,"box":{"x":115,"y":446,"width":767,"height":13}},{"id":"7e63f548-2804-4d65-8f6d-e1bba725342c","block_type":"box","text":"shareholder value, or if the incumbent board members do not demonstrate the relevant skills and","page_number":213,"box":{"x":116,"y":462,"width":725,"height":11}},{"id":"feab6ecc-6734-4f45-8e57-287796c36d9c","block_type":"box","text":"expertise or have a poor track record of protecting shareholders’ interests.","page_number":213,"box":{"x":116,"y":477,"width":556,"height":13}},{"id":"3b030c6d-1e81-4a8c-a2ff-7a8064ffda0d","block_type":"box","text":"Significant shareholders and related party transactions","page_number":213,"box":{"x":116,"y":509,"width":446,"height":12}},{"id":"53b14bd8-831a-4734-9325-3361e8d5951c","block_type":"box","text":"Boards of companies with affiliated shareholders or directors should give equitable consideration to the","page_number":213,"box":{"x":117,"y":541,"width":768,"height":12}},{"id":"63d891a6-f9ee-47ea-91e7-34b9299e667f","block_type":"box","text":"interests of all shareholders when evaluating related party transactions.","page_number":213,"box":{"x":117,"y":556,"width":534,"height":12}},{"id":"a6bf4c1a-d7ff-4026-96dd-2b674517eb83","block_type":"box","text":"We consider it good practice for transactions with related parties, such as significant shareholders or","page_number":213,"box":{"x":116,"y":588,"width":751,"height":12}},{"id":"1d246aab-4e69-454d-9357-d23ea9a5338b","block_type":"box","text":"companies affiliated with the public company, to be disclosed in detail and conducted on terms similar","page_number":213,"box":{"x":116,"y":604,"width":760,"height":12}},{"id":"d021be9c-4efe-4aad-8cbc-5307af532ddf","block_type":"box","text":"to what would objectively have been agreed with a non-related party. In our view, such transactions","page_number":213,"box":{"x":116,"y":619,"width":743,"height":12}},{"id":"f182c587-b9de-4c7e-bb94-37205ed323d2","block_type":"box","text":"should be reviewed and approved by the independent members of the board, and if voted on, only","page_number":213,"box":{"x":116,"y":635,"width":734,"height":12}},{"id":"3c68bfdc-8df6-4ad1-8931-539a53497afb","block_type":"box","text":"disinterested shareholders should vote.","page_number":213,"box":{"x":116,"y":650,"width":297,"height":10}},{"id":"8af9cb8f-0fd3-4a62-a576-4aced16921e4","block_type":"box","text":"Corporate reporting, risk management and audit","page_number":213,"box":{"x":307,"y":690,"width":385,"height":12}},{"id":"b064380f-3317-4724-bd24-d709710c66bb","block_type":"box","text":"Investors depend on corporate reporting, both regulatory and voluntary, to understand a company’s","page_number":213,"box":{"x":117,"y":722,"width":737,"height":12}},{"id":"a40ff3ce-5893-4cb5-88e2-8af594976855","block_type":"box","text":"strategy, its implementation and financial performance, as well as to assess the quality of management","page_number":213,"box":{"x":116,"y":737,"width":765,"height":12}},{"id":"fb8e1f04-a3e9-418a-8e41-213b983f663f","block_type":"box","text":"and operations and potential for the company to create shareholder value over time. We consider it","page_number":213,"box":{"x":116,"y":753,"width":736,"height":12}},{"id":"a6b64655-283b-4302-8aa9-ef1b3fd2db9b","block_type":"box","text":"good practice for the board to oversee corporate reporting and the policies and procedures","page_number":213,"box":{"x":116,"y":768,"width":674,"height":12}},{"id":"eb62234e-d12a-419e-894d-400f0f18f9d2","block_type":"box","text":"underpinning the internal audit function and external audit.","page_number":213,"box":{"x":117,"y":784,"width":430,"height":12}},{"id":"3cbf6862-1c13-4b95-a9a9-242d67d2b245","block_type":"box","text":"A company’s financial reporting should provide decision-useful information for investors, and other","page_number":213,"box":{"x":116,"y":815,"width":730,"height":13}},{"id":"2f19508d-1901-4a81-b23c-d6a1052d4b43","block_type":"box","text":"stakeholders, on its financial performance and position. It should provide an accurate and balanced","page_number":213,"box":{"x":116,"y":831,"width":742,"height":12}},{"id":"70e750bd-63b7-40aa-baa3-e84660e5db82","block_type":"box","text":"assessment of the risks and opportunities the company faces in realizing its long-term strategy.","page_number":213,"box":{"x":116,"y":846,"width":712,"height":13}},{"id":"fa2f27dd-e078-4c72-afe8-cf154844fa4d","block_type":"box","text":"Accordingly, the assumptions made by management and reviewed by the auditor in preparing the","page_number":213,"box":{"x":116,"y":862,"width":729,"height":12}},{"id":"b14a29a6-934b-4580-be15-108e448e04a8","block_type":"box","text":"financial statements should be reasonable and justified. Financial statements should be prepared in","page_number":213,"box":{"x":116,"y":877,"width":744,"height":13}},{"id":"189c5da4-8a39-4789-a512-ec85fb474d0a","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":213,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"bc3a1186-de72-4281-be9b-dd136d36698a","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":213,"box":{"x":530,"y":909,"width":324,"height":12}},{"id":"876a821f-a4f7-4594-91bf-d0b2cf84753b","block_type":"box","text":"12","page_number":213,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"27adb32c-128f-4ddc-94cb-f55b37c056a7","block_type":"box","text":"NM0926U-5926888-213/257","page_number":213,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"42ec69d1-8add-49a3-82d5-c7efbaab30b2","block_type":"box","text":"accordance with globally developed reporting standards and any divergence from generally accepted","page_number":214,"box":{"x":116,"y":87,"width":755,"height":12}},{"id":"38370b6d-9c05-4cd7-8c9b-141adbcb0341","block_type":"box","text":"accounting principles should be explained in detail and justified. Accounting restatements should be","page_number":214,"box":{"x":116,"y":102,"width":745,"height":13}},{"id":"7164748d-71e8-4d13-9331-3ae90b299c5c","block_type":"box","text":"explained in detail and any remedial actions, and the implications of these, disclosed.","page_number":214,"box":{"x":116,"y":118,"width":638,"height":12}},{"id":"2a55e466-a61a-4cdc-ac0c-98b5ddefb6b1","block_type":"box","text":"In this context, audit committees play a vital role in a company’s financial reporting system by providing","page_number":214,"box":{"x":117,"y":149,"width":769,"height":12}},{"id":"9897a291-13a1-480a-a09f-dcf72dec792a","block_type":"box","text":"independent oversight of the accounts, material financial and, where appropriate to the jurisdiction,","page_number":214,"box":{"x":117,"y":165,"width":737,"height":12}},{"id":"58f18e93-1287-4be2-95c2-c51b80dd6235","block_type":"box","text":"non-financial information, internal control frameworks and Enterprise Risk Management systems. In","page_number":214,"box":{"x":117,"y":180,"width":743,"height":12}},{"id":"e4ac535d-0325-451a-be32-df5871ce504b","block_type":"box","text":"our view, effective audit committee oversight strengthens the quality and reliability of a company’s","page_number":214,"box":{"x":116,"y":196,"width":730,"height":12}},{"id":"976d0820-92ce-401e-b114-c04381b78762","block_type":"box","text":"financial statements and provides an important level of reassurance to shareholders. Audit committees","page_number":214,"box":{"x":116,"y":211,"width":767,"height":12}},{"id":"bdb283a4-7cf1-4da3-9ce9-6e7ae56663cc","block_type":"box","text":"should have a procedure in place for assessing the independence of the auditor and the quality of the","page_number":214,"box":{"x":116,"y":227,"width":758,"height":12}},{"id":"5bf04203-d2ff-4531-a705-ad5f16d5cc0c","block_type":"box","text":"external audit process annually.","page_number":214,"box":{"x":116,"y":242,"width":241,"height":12}},{"id":"35f3d526-dc4b-40bd-99c9-c4e910d4391f","block_type":"box","text":"Similarly, we encourage companies to disclose material sustainability-related factors that are integral to","page_number":214,"box":{"x":116,"y":273,"width":771,"height":12}},{"id":"7be5681d-10fe-462b-98ab-9f4c2b1bd039","block_type":"box","text":"how a company manages risks or generates revenue. BAIS finds it helpful to our understanding when","page_number":214,"box":{"x":117,"y":289,"width":758,"height":12}},{"id":"ec84ec8c-a790-41fb-a59d-9563005fec24","block_type":"box","text":"companies provide robust, standardized disclosures on their material sustainability-related risks and","page_number":214,"box":{"x":116,"y":304,"width":747,"height":12}},{"id":"ced2ac88-f38d-4e9d-8069-4f343b7f79c7","block_type":"box","text":"opportunities. The International Sustainability Standards Board (ISSB) is one entity working to meet","page_number":214,"box":{"x":116,"y":320,"width":743,"height":12}},{"id":"350cc313-43e3-4ee4-999c-9a6a7ad6ce9b","block_type":"box","text":"these objectives through its reporting standards, which may be helpful to companies in preparing such","page_number":214,"box":{"x":116,"y":335,"width":763,"height":12}},{"id":"b815cebe-1ab3-4c6b-8982-d7d78a0d18cd","block_type":"box","text":"reports.","page_number":214,"box":{"x":117,"y":351,"width":54,"height":12}},{"id":"e371cca4-cfa8-44fc-b8a0-8d615cf62143","block_type":"box","text":"9","page_number":214,"box":{"x":173,"y":351,"width":5,"height":6}},{"id":"8074dcf1-c8b9-4e65-9de7-7a5ca28ac190","block_type":"box","text":"However, we do not mandate any specific disclosure framework, and note that companies in","page_number":214,"box":{"x":179,"y":351,"width":696,"height":12}},{"id":"dfe9e267-10a4-4daa-bc57-2c972794d661","block_type":"box","text":"certain jurisdictions are subject to mandatory reporting requirements under standards specified by","page_number":214,"box":{"x":116,"y":366,"width":731,"height":12}},{"id":"bcd0f68f-f973-4c2c-baf1-7932715077ed","block_type":"box","text":"policy makers.","page_number":214,"box":{"x":117,"y":382,"width":105,"height":12}},{"id":"76bad83b-108c-4ad0-a2b3-1145e8bf796b","block_type":"box","text":"10","page_number":214,"box":{"x":224,"y":382,"width":11,"height":6}},{"id":"ce48e4cf-2dde-4ac4-9117-bf3da388623e","block_type":"box","text":"Companies should establish robust risk management and internal control processes appropriate to the","page_number":214,"box":{"x":117,"y":413,"width":765,"height":12}},{"id":"19a028c3-463d-48c3-91a6-af52e037b5dd","block_type":"box","text":"company’s business, risk tolerance, and regulatory environment. A credible whistleblowing system for","page_number":214,"box":{"x":116,"y":428,"width":759,"height":12}},{"id":"d92965e5-85fa-425a-8dec-ae967e8de438","block_type":"box","text":"employees, and potentially other stakeholders, can be a useful mechanism for ensuring that senior","page_number":214,"box":{"x":116,"y":444,"width":738,"height":12}},{"id":"57f550e0-a800-4f4d-ab3c-c4dfabf3d8c5","block_type":"box","text":"management and the board are aware of potential misconduct or breaches in risk management and","page_number":214,"box":{"x":117,"y":459,"width":745,"height":12}},{"id":"36e51b07-75a8-47b2-975b-b800e7e58774","block_type":"box","text":"internal control processes.","page_number":214,"box":{"x":117,"y":475,"width":200,"height":12}},{"id":"b55ed787-a705-44da-861c-e89cb4133f59","block_type":"box","text":"A comprehensive audit conducted by an independent audit firm contributes to investor confidence in","page_number":214,"box":{"x":116,"y":506,"width":748,"height":12}},{"id":"aa29556c-24b3-445a-8b66-0f5d895248a5","block_type":"box","text":"the quality of corporate reporting. It is helpful when the audit report gives some insight into the scope","page_number":214,"box":{"x":116,"y":521,"width":752,"height":12}},{"id":"be5bf0aa-616e-4903-8a4c-bd984cb0de30","block_type":"box","text":"and focus of the audit, as well as any critical audit matters identified and how these were resolved. A","page_number":214,"box":{"x":116,"y":537,"width":751,"height":12}},{"id":"d0c82bf0-6ba3-49d9-aa92-82cbe6a125f9","block_type":"box","text":"comprehensive and effective audit is time and resource intensive, and the audit fee should be","page_number":214,"box":{"x":116,"y":552,"width":700,"height":12}},{"id":"aa60f4b4-7b67-46ed-a55c-0466841dbf3e","block_type":"box","text":"commensurate. Fees paid to the audit firm for non-audit consulting should not exceed the audit fee to a","page_number":214,"box":{"x":116,"y":568,"width":771,"height":12}},{"id":"599757d4-c9cd-4de6-b95e-68717d0a21e9","block_type":"box","text":"degree that may prompt concerns about the independence of the audit. The audit committee should","page_number":214,"box":{"x":116,"y":583,"width":746,"height":12}},{"id":"770a756e-f459-45b6-a37f-9d50bbc08aad","block_type":"box","text":"explain its position on auditor tenure and how it confirmed that the auditor remained independent.","page_number":214,"box":{"x":116,"y":599,"width":728,"height":12}},{"id":"865a0339-5591-43e6-8fe8-cf29f358c1d0","block_type":"box","text":"We may vote against the election of the responsible directors if corporate reporting is insufficient or","page_number":214,"box":{"x":116,"y":630,"width":740,"height":12}},{"id":"cd3913b6-8186-47ce-b62c-fa51df3205f0","block_type":"box","text":"there are material misstatements in financial reports. In markets where relevant, we may vote against a","page_number":214,"box":{"x":116,"y":645,"width":771,"height":12}},{"id":"c7ecf47b-a511-4fd0-adeb-9565cd76b101","block_type":"box","text":"proposal to approve the financial statements or the discharge of the board when we are concerned","page_number":214,"box":{"x":117,"y":661,"width":731,"height":12}},{"id":"8d7e7008-8158-45b2-9a91-9599f394260f","block_type":"box","text":"about the quality of corporate reporting or the audit. We may vote against proposals to appoint the","page_number":214,"box":{"x":116,"y":676,"width":728,"height":12}},{"id":"5e059b78-6304-4285-a214-77e06fdda1fd","block_type":"box","text":"auditor, ratify the audit report, or approve the audit fee if we are concerned about the auditor’s","page_number":214,"box":{"x":116,"y":692,"width":697,"height":12}},{"id":"d43d03e8-bcf8-4a75-a187-a520d2964326","block_type":"box","text":"independence, the quality of the audit, or there are material misstatements in financial reports and the","page_number":214,"box":{"x":117,"y":707,"width":754,"height":12}},{"id":"0baaa58c-272c-46f1-919a-4efa3824bb4c","block_type":"box","text":"board has not established reasonable remediation plans.","page_number":214,"box":{"x":117,"y":723,"width":420,"height":12}},{"id":"6fb1a12f-5bca-46e4-a43b-cd29b560ce80","block_type":"box","text":"9","page_number":214,"box":{"x":143,"y":815,"width":4,"height":5}},{"id":"2fab0536-0582-44d0-a8de-a756fa61c0f1","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Reporting Standards (IFRS)","page_number":214,"box":{"x":170,"y":815,"width":666,"height":10}},{"id":"7181b5c6-c01f-4647-b5b0-f6634eb8f773","block_type":"box","text":"Foundation. Please refer to the IFRS website to learn more about the framework and standards S1 “General","page_number":214,"box":{"x":171,"y":828,"width":641,"height":8}},{"id":"202a8217-d8da-4622-b42a-1283416bb6ec","block_type":"box","text":"Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related Disclosures.”","page_number":214,"box":{"x":171,"y":841,"width":672,"height":9}},{"id":"b5921cde-6ac7-40fe-8891-e3e95b3cb436","block_type":"box","text":"10","page_number":214,"box":{"x":144,"y":854,"width":8,"height":5}},{"id":"87147a66-7d16-470b-9006-85f0e6f80610","block_type":"box","text":"See, for examples, https://www.ifrs.org/news-and-events/news/2025/06/ifrs-foundation-publishes-jurisdictional-profiles","page_number":214,"box":{"x":170,"y":854,"width":705,"height":9}},{"id":"824641a0-bc18-4949-916a-ad4927d85f5f","block_type":"box","text":"issb-standards/ and https://finance.ec.europa.eu/capital-markets-union-and-financial-markets/company","page_number":214,"box":{"x":170,"y":867,"width":615,"height":9}},{"id":"1d88baf7-1ed2-4d90-9686-2593fa6509c8","block_type":"box","text":"reporting-and-auditing/company-reporting/corporate-sustainability-reporting_en","page_number":214,"box":{"x":170,"y":880,"width":468,"height":9}},{"id":"b5b137bb-26f3-45b0-8267-09c885e4c689","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":214,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"3af7a0dd-37a4-463e-9cde-5107fac6d695","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":214,"box":{"x":530,"y":909,"width":324,"height":12}},{"id":"28b1b9c8-a605-4e58-8851-295ba3ab8af8","block_type":"box","text":"13","page_number":214,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"a92aa05a-dae5-4e41-9875-b58a51cc8313","block_type":"box","text":"NM0926U-5926888-214/257","page_number":214,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"e1606483-af8f-4d54-8642-861b9885d260","block_type":"box","text":"Shareholder rights and protections","page_number":215,"box":{"x":360,"y":87,"width":285,"height":12}},{"id":"b4ffdf79-91c5-41f0-a6c3-322d165a5149","block_type":"box","text":"General shareholder meetings","page_number":215,"box":{"x":116,"y":116,"width":247,"height":12}},{"id":"1d2bad8f-cc2e-4049-a918-a9f1cfa1a42c","block_type":"box","text":"Companies normally have an annual general meeting of shareholders at which routine and non-routine","page_number":215,"box":{"x":117,"y":144,"width":768,"height":13}},{"id":"2c7f9758-8703-4ab1-8fe4-2b2ead9c8196","block_type":"box","text":"items of business are discussed and voted on by shareholders in attendance or submitting proxy votes.","page_number":215,"box":{"x":117,"y":160,"width":771,"height":12}},{"id":"d61e2ca7-88fa-4424-807a-f3178d68a7ee","block_type":"box","text":"Companies should disclose materials relevant to the shareholder meeting sufficiently in advance so","page_number":215,"box":{"x":117,"y":175,"width":742,"height":13}},{"id":"3beee89f-bf97-4fd2-9435-be24da57054f","block_type":"box","text":"that shareholders can take them into consideration in their voting decisions. Many companies offer","page_number":215,"box":{"x":116,"y":191,"width":736,"height":12}},{"id":"ed4cce9e-e229-448a-8008-9dca8a74f48e","block_type":"box","text":"shareholders the option of participating in the meeting virtually which, whilst welcome, should not limit","page_number":215,"box":{"x":116,"y":207,"width":758,"height":12}},{"id":"bc9e99bc-7fed-44b6-b0a5-4e0dca04030e","block_type":"box","text":"the rights of shareholders to participate as they would during an in-person meeting.","page_number":215,"box":{"x":116,"y":222,"width":622,"height":12}},{"id":"2d6f0f21-bcfc-4a1c-84ba-f813d93f0228","block_type":"box","text":"We may vote against directors when materials related to the business of the shareholder meeting are","page_number":215,"box":{"x":116,"y":251,"width":757,"height":12}},{"id":"f0ff680f-8da8-4090-b8e2-5aaa8fee1d40","block_type":"box","text":"not provided in a timely manner or do not provide sufficient information for us to make an informed","page_number":215,"box":{"x":117,"y":266,"width":733,"height":12}},{"id":"054c4795-6948-4e0a-a370-716633bd50bf","block_type":"box","text":"voting decision. We may vote against directors if the format of the shareholder meeting does not","page_number":215,"box":{"x":116,"y":282,"width":719,"height":12}},{"id":"ec103b39-791a-4901-82a6-bcdf5a882518","block_type":"box","text":"accommodate reasonable shareholder participation.","page_number":215,"box":{"x":116,"y":297,"width":392,"height":12}},{"id":"3835b9af-75a0-4d3b-87df-f73e5c8420be","block_type":"box","text":"Bylaw amendments","page_number":215,"box":{"x":117,"y":326,"width":161,"height":12}},{"id":"636c3593-2084-4a82-9658-2ae96295b187","block_type":"box","text":"We review bylaw amendments proposed by management on a case-by-case basis and will generally","page_number":215,"box":{"x":116,"y":355,"width":753,"height":12}},{"id":"3694faff-2936-40b2-990b-f4c80e807862","block_type":"box","text":"support those that are aligned with the interests of minority shareholders. Any material changes to the","page_number":215,"box":{"x":116,"y":370,"width":761,"height":12}},{"id":"811fee16-2112-4158-9bb0-0aa4a5368764","block_type":"box","text":"bylaws should be explained in detail and put to a shareholder vote.","page_number":215,"box":{"x":117,"y":386,"width":500,"height":12}},{"id":"f5c5305e-3eba-499c-a4ed-daa8f6168cc0","block_type":"box","text":"We may vote against bylaw amendments that reduce shareholder rights and protections or introduce","page_number":215,"box":{"x":116,"y":415,"width":753,"height":12}},{"id":"518c9a35-68d5-41ac-bb37-fc505059fb11","block_type":"box","text":"additional burdens. We may vote against directors if material changes are made to the bylaws without","page_number":215,"box":{"x":116,"y":430,"width":760,"height":12}},{"id":"819ccb0d-44a9-4d45-9e7f-44e160ad7c20","block_type":"box","text":"shareholder approval.","page_number":215,"box":{"x":116,"y":446,"width":167,"height":11}},{"id":"28a0c4af-e74a-4766-b9ce-808e66c221d0","block_type":"box","text":"If not provided for in the relevant corporate law, company bylaws should allow shareholders,","page_number":215,"box":{"x":117,"y":474,"width":688,"height":12}},{"id":"76afc49e-1927-49ba-9831-f4ceabc9b3e8","block_type":"box","text":"individually or as a group, with a meaningful shareholding, the right to call a special meeting of","page_number":215,"box":{"x":117,"y":490,"width":704,"height":12}},{"id":"0a040941-dbae-4697-9957-ea32ed8a7063","block_type":"box","text":"shareholders. The shareholding required to exercise this right should balance its utility with the cost to","page_number":215,"box":{"x":116,"y":505,"width":761,"height":12}},{"id":"af27817f-8a05-4887-a190-788c85c38e5f","block_type":"box","text":"the company of holding special meetings.","page_number":215,"box":{"x":116,"y":521,"width":307,"height":12}},{"id":"f4bb21b8-05a3-4487-a90a-b0d2ca823f5f","block_type":"box","text":"If not provided for in the relevant corporate law, company bylaws should allow shareholders,","page_number":215,"box":{"x":117,"y":550,"width":688,"height":12}},{"id":"4e9d975a-b792-4c27-b71e-561c6bfae5ad","block_type":"box","text":"individually or as a group, with a meaningful shareholding, the right to nominate directors to the","page_number":215,"box":{"x":117,"y":565,"width":710,"height":12}},{"id":"fdc19562-dff4-4e5d-b0bf-3041ac349aed","block_type":"box","text":"company’s board. The threshold for this right should be set so that shareholders can exercise it without","page_number":215,"box":{"x":116,"y":581,"width":770,"height":12}},{"id":"09e12c6e-988f-4437-ba22-e32384b96579","block_type":"box","text":"being unduly disruptive to the board’s own nomination process.","page_number":215,"box":{"x":117,"y":596,"width":473,"height":12}},{"id":"746eb228-39b1-42a5-9946-2b4428aa6625","block_type":"box","text":"Whilst we would not use either of these rights ourselves, we see them as important accountability","page_number":215,"box":{"x":116,"y":625,"width":728,"height":12}},{"id":"7a5d08b2-0855-42fd-a7ae-c7e9735a71a6","block_type":"box","text":"mechanisms. We may vote for a shareholder proposal seeking the addition of either of these","page_number":215,"box":{"x":117,"y":640,"width":691,"height":12}},{"id":"6d54f39f-6e66-4edf-bec6-51631d36299b","block_type":"box","text":"provisions to a company’s bylaws.","page_number":215,"box":{"x":117,"y":656,"width":258,"height":12}},{"id":"c73774b0-04b0-4837-87ff-544b9763e6d4","block_type":"box","text":"Change of domicile","page_number":215,"box":{"x":116,"y":685,"width":154,"height":12}},{"id":"2038d3a9-6a17-4a2b-8389-db55cda805cf","block_type":"box","text":"We generally defer to management on proposals to change a company’s domicile as long as the","page_number":215,"box":{"x":116,"y":713,"width":717,"height":12}},{"id":"4cefe7b0-30a2-486a-a2cd-3b669a84f9da","block_type":"box","text":"rationale for doing so is consistent with the company’s long-term strategy and business model and the","page_number":215,"box":{"x":117,"y":729,"width":756,"height":12}},{"id":"6aad85ca-da51-4b8b-9745-046960153bf9","block_type":"box","text":"related costs are immaterial.","page_number":215,"box":{"x":117,"y":744,"width":209,"height":10}},{"id":"4f35086b-911e-4824-a802-247113583c62","block_type":"box","text":"We may vote against directors or a proposal to change a company’s domicile where it does not seem","page_number":215,"box":{"x":116,"y":773,"width":751,"height":12}},{"id":"d396131a-3eb4-4473-bac2-211ee5f0abca","block_type":"box","text":"aligned with our clients’ financial interests.","page_number":215,"box":{"x":116,"y":789,"width":311,"height":12}},{"id":"7fe39a97-7a3e-460b-ba53-aecd1101cc65","block_type":"box","text":"Changes to a company’s purpose or the nature of its business","page_number":215,"box":{"x":116,"y":817,"width":499,"height":12}},{"id":"1d3f01dc-aed1-497b-a543-a60f93281021","block_type":"box","text":"Plans to materially change the nature of a company’s business or its purpose should be disclosed and","page_number":215,"box":{"x":117,"y":846,"width":762,"height":12}},{"id":"ed51e325-d1eb-46b9-b176-d0fa77433a95","block_type":"box","text":"explained in the context of long-term strategy and business dynamics. Such changes may significantly","page_number":215,"box":{"x":116,"y":862,"width":764,"height":12}},{"id":"1510664a-ebdc-4632-8ff9-8af06382c878","block_type":"box","text":"alter an investor’s views on the suitability of a company for their investment strategy or portfolio.","page_number":215,"box":{"x":116,"y":877,"width":716,"height":12}},{"id":"1b8399f5-c2d2-4e27-a236-4cd05f71114a","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":215,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"999e1b94-0059-4b5c-ac05-30735bf508de","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":215,"box":{"x":530,"y":909,"width":324,"height":12}},{"id":"be4bde4f-7582-467b-90ce-4a6eedcf6596","block_type":"box","text":"14","page_number":215,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"1ff83f75-393a-460b-8bbb-d239d2fc598c","block_type":"box","text":"NM0926U-5926888-215/257","page_number":215,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"b8240f93-c57d-418d-9ac7-d443400b8c7a","block_type":"box","text":"Where relevant, we may vote against proposals to change a company’s purpose or the nature of its","page_number":216,"box":{"x":116,"y":87,"width":743,"height":12}},{"id":"6f11ef51-397f-4c69-9878-9d22ccd38097","block_type":"box","text":"business if the board has not provided a credible argument for change.","page_number":216,"box":{"x":117,"y":102,"width":530,"height":13}},{"id":"fe567a00-3621-4a63-b75c-6f1d2e8d5918","block_type":"box","text":"Shareholder proposals","page_number":216,"box":{"x":409,"y":141,"width":187,"height":12}},{"id":"b9f46a42-f08c-483a-9f1d-906fe897e46a","block_type":"box","text":"Shareholders in many markets, who meet certain eligibility criteria, have the right to submit proposals","page_number":216,"box":{"x":116,"y":172,"width":756,"height":12}},{"id":"0a0c0656-b0a6-441f-a769-f9e51e823f0a","block_type":"box","text":"to the general shareholder meeting asking a company to take a particular course of action subject to","page_number":216,"box":{"x":116,"y":188,"width":749,"height":12}},{"id":"38545736-2ec8-4bb8-9220-2cbc17eed0d8","block_type":"box","text":"the proposal being supported by a majority of votes cast at the meeting. The topics raised can address","page_number":216,"box":{"x":116,"y":203,"width":767,"height":12}},{"id":"fa5e97ad-ad1f-42e4-bd73-590d1e4a2234","block_type":"box","text":"a range of matters that may be relevant to a company’s business.","page_number":216,"box":{"x":116,"y":219,"width":492,"height":12}},{"id":"d6222148-7c63-4d31-9172-f690392a33de","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":216,"box":{"x":116,"y":250,"width":767,"height":12}},{"id":"63ea8832-76bc-4f9e-ba72-61f33bea87bd","block_type":"box","text":"company’s business and its current approach, whether the actions sought are consistent with","page_number":216,"box":{"x":116,"y":265,"width":697,"height":12}},{"id":"30c08c85-312d-4037-9dab-f1d69e7c8fe0","block_type":"box","text":"shareholders’ interests, and what impact the proposal being acted upon might have on financial","page_number":216,"box":{"x":116,"y":281,"width":714,"height":12}},{"id":"126e937f-a8fe-4cf4-927e-508083c72ce3","block_type":"box","text":"performance.","page_number":216,"box":{"x":117,"y":296,"width":103,"height":12}},{"id":"eda25b50-6d84-4460-abe8-245de753e39c","block_type":"box","text":"Our general approach where we have concerns about","page_number":216,"box":{"x":116,"y":327,"width":393,"height":12}},{"id":"4415c8eb-8c11-4570-8822-53f319426304","block_type":"box","text":"t a company’s governance, disclosures or","page_number":216,"box":{"x":509,"y":327,"width":303,"height":12}},{"id":"c9796b8e-33c3-4ef6-b5c7-5ba97476f678","block_type":"box","text":"performance is to engage to understand the apparent diffe","page_number":216,"box":{"x":117,"y":343,"width":423,"height":12}},{"id":"8c5f55fb-2e4b-4cbc-88cf-63708ac4bc11","block_type":"box","text":"rence in perspective. If we are concerned a","page_number":216,"box":{"x":541,"y":343,"width":319,"height":12}},{"id":"e2059b6f-63b2-4bd5-b195-ce8a6146355c","block_type":"box","text":"company is not acting in shareholders’ financial interest","page_number":216,"box":{"x":116,"y":358,"width":403,"height":12}},{"id":"fae4d9c0-f8fc-44e9-a9e2-5546d9ac1d92","block_type":"box","text":"s, we may vote against the election of directors.","page_number":216,"box":{"x":519,"y":358,"width":351,"height":12}},{"id":"11eca86c-b318-4436-b044-e6372eb94940","block_type":"box","text":"We may support a relevant shareholder proposal if doing","page_number":216,"box":{"x":116,"y":374,"width":418,"height":12}},{"id":"90913b7a-fa65-4f9e-a5a6-33000f703491","block_type":"box","text":"so is aligned with our clients’ financial interests.","page_number":216,"box":{"x":534,"y":374,"width":348,"height":12}},{"id":"0334fdf1-40fa-4cc2-87ad-8dd9e3db38a0","block_type":"box","text":"We generally do not support shareholder proposals that","page_number":216,"box":{"x":116,"y":389,"width":410,"height":12}},{"id":"77b5f2ae-62c5-42be-8dcd-52f7ce4a9fb3","block_type":"box","text":"are legally binding on the company, seek to alter","page_number":216,"box":{"x":526,"y":389,"width":357,"height":12}},{"id":"531c7a2b-a250-4a03-aca4-9f03270dd9d9","block_type":"box","text":"a company’s strategy or direct its operations,","page_number":216,"box":{"x":116,"y":405,"width":331,"height":12}},{"id":"f7695341-ccc8-4f49-a25a-516f25893568","block_type":"box","text":"or are unrelated to how a company manages risk or","page_number":216,"box":{"x":447,"y":405,"width":381,"height":12}},{"id":"7bf94f17-ef92-45fe-ba51-961abc0308d1","block_type":"box","text":"generates financial returns.","page_number":216,"box":{"x":116,"y":420,"width":203,"height":12}},{"id":"cb8ff49f-32cb-46bf-9cc7-111fd948dcf8","block_type":"box","text":"BlackRock is subject to rules, regulations, agency guidance and contractual agreements that place","page_number":216,"box":{"x":117,"y":451,"width":737,"height":12}},{"id":"19b0214a-106f-4fd7-a575-4aff0c1ca21e","block_type":"box","text":"restrictions and limitations on how we can interact with the companies in which we invest on behalf of","page_number":216,"box":{"x":117,"y":467,"width":755,"height":12}},{"id":"fa9fc3ca-8ffc-4666-8f77-5117d087e0f2","block_type":"box","text":"our clients, including our ability to submit shareholder proposals. We do not submit shareholder","page_number":216,"box":{"x":116,"y":482,"width":712,"height":12}},{"id":"7d11bf81-093e-4ee8-b89c-9dde0f528483","block_type":"box","text":"proposals but can vote, on behalf of clients who authorize us to do so, on proposals put forth by others.","page_number":216,"box":{"x":117,"y":498,"width":770,"height":12}},{"id":"23072640-df20-4f62-bd15-20d6530cf4b9","block_type":"box","text":"Corporate political activities","page_number":216,"box":{"x":387,"y":537,"width":230,"height":12}},{"id":"4545ff37-05db-4655-ad1c-a5fa4e7298d4","block_type":"box","text":"A corporation’s ability to engage in the policy process is subject to rules and regulations set by the","page_number":216,"box":{"x":116,"y":568,"width":733,"height":12}},{"id":"56880fb3-b277-4daa-b5dc-f293996b5564","block_type":"box","text":"jurisdictions in which they engage. When a corporation reports material financial risk related to policy","page_number":216,"box":{"x":115,"y":583,"width":754,"height":12}},{"id":"40b8b4df-8ebe-41c5-89e8-adba054fc1a7","block_type":"box","text":"and or regulatory changes, BAIS may seek to understand how it is addressing the material risk","page_number":216,"box":{"x":116,"y":599,"width":708,"height":12}},{"id":"7c6c5c3d-ed41-4ab9-bec7-e14c73421ea4","block_type":"box","text":"identified. We seek to understand how companies engage in corporate political activities and ensure","page_number":216,"box":{"x":117,"y":614,"width":748,"height":12}},{"id":"41b17699-73ef-4e86-a609-f962ee875f50","block_type":"box","text":"that their participation is consistent with their public statements on policy matters material to the","page_number":216,"box":{"x":116,"y":630,"width":714,"height":12}},{"id":"57ea806c-67b9-4c24-b144-fa460089d9ee","block_type":"box","text":"company’s long-term strategy. The board should be aware of the approach taken by management on","page_number":216,"box":{"x":116,"y":645,"width":756,"height":12}},{"id":"72ee7049-d62e-4c7c-938c-e39c8c429ac7","block_type":"box","text":"corporate political activities as there can be reputational risks arising from inconsistencies between a","page_number":216,"box":{"x":116,"y":661,"width":746,"height":12}},{"id":"c1cad4f3-d1b1-4423-ba5a-320ac02a4791","block_type":"box","text":"company’s policy engagement and stated policy positions. Companies should, as a minimum, meet all","page_number":216,"box":{"x":116,"y":676,"width":758,"height":12}},{"id":"d229de8d-b66e-47b3-9722-8a52a181a668","block_type":"box","text":"regulatory disclosure requirements on political activities. We may engage a company where we would","page_number":216,"box":{"x":117,"y":692,"width":753,"height":12}},{"id":"ec7e5bf4-cc52-4403-8504-a584bc857e4a","block_type":"box","text":"like to better understand its approach to policy engagement, where relevant.","page_number":216,"box":{"x":117,"y":707,"width":563,"height":12}},{"id":"4ac58da0-ecf1-4934-b67f-c84c26b875da","block_type":"box","text":"To mitigate the risk of inconsistencies, companies may wish to assess the alignment between their","page_number":216,"box":{"x":116,"y":738,"width":732,"height":12}},{"id":"b9e56bec-b198-4efc-bf86-26a7e90024fb","block_type":"box","text":"policy priorities and the policy positions of the trade associations of which they are active members and","page_number":216,"box":{"x":117,"y":754,"width":764,"height":12}},{"id":"8897f466-73a3-4cbc-a3b8-154b887fdaf3","block_type":"box","text":"any engagements undertaken by trade associations on behalf of members.","page_number":216,"box":{"x":116,"y":769,"width":556,"height":12}},{"id":"1bf36bb4-0b65-45ce-9d84-42238de47e35","block_type":"box","text":"We may support a relevant shareholder proposal, or vote against directors, where a company’s","page_number":216,"box":{"x":116,"y":800,"width":707,"height":12}},{"id":"82e95565-89c7-4bd5-b40d-d22b8c02db7f","block_type":"box","text":"disclosures are insufficient to address the material risk it has identified.","page_number":216,"box":{"x":116,"y":816,"width":524,"height":9}},{"id":"a90a38f4-9a54-418b-a6bb-e8d282bb876c","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":216,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"9f803fba-e19c-4a5f-98b5-ac0a64609768","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":216,"box":{"x":530,"y":909,"width":324,"height":12}},{"id":"34b1f0e1-8e02-431f-9d69-de6e8dff3422","block_type":"box","text":"15","page_number":216,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"47ff8013-76c4-4578-9004-661440d05e93","block_type":"box","text":"NM0926U-5926888-216/257","page_number":216,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"6f8febdb-7128-4b66-a331-7242977a780c","block_type":"box","text":"Material sustainability-related risks and opportunities","page_number":217,"box":{"x":287,"y":87,"width":431,"height":12}},{"id":"be195687-34e2-4426-93fd-a311134e3af4","block_type":"box","text":"We seek to understand how companies manage the material risks and opportunities inherent in their","page_number":217,"box":{"x":116,"y":118,"width":751,"height":12}},{"id":"9b9fb9f4-7419-48d5-83f7-3265c1a4a4aa","block_type":"box","text":"business operations. In our experience, sustainability-related factors","page_number":217,"box":{"x":117,"y":133,"width":505,"height":12}},{"id":"299ee5ff-f482-4d91-b7cf-03feb25f2714","block_type":"box","text":"11","page_number":217,"box":{"x":624,"y":133,"width":9,"height":6}},{"id":"bfd9cb2b-25f8-4738-82fb-e22e4f5f14c2","block_type":"box","text":"that are relevant to a company’s","page_number":217,"box":{"x":635,"y":133,"width":249,"height":12}},{"id":"34745eab-f333-40dd-8ee4-f464c64bce2e","block_type":"box","text":"business or material to its financial performance, are generally operational considerations embedded","page_number":217,"box":{"x":117,"y":149,"width":752,"height":12}},{"id":"d1c026a3-93a7-4be6-931f-060ab67f0a1f","block_type":"box","text":"into day-to-day management systems. Certain sustainability issues may also inform long-term strategic","page_number":217,"box":{"x":117,"y":164,"width":769,"height":12}},{"id":"1695a5d8-30dd-439a-98eb-676d8f803c3f","block_type":"box","text":"planning, for example, investing in product innovation in anticipation of changing consumer demand or","page_number":217,"box":{"x":117,"y":180,"width":763,"height":12}},{"id":"d9986ba9-df31-43d6-80c7-2bc0645d4bc9","block_type":"box","text":"adapting supply chains in response to changing regulatory requirements.","page_number":217,"box":{"x":116,"y":195,"width":546,"height":12}},{"id":"2d7f1495-dcbf-4d6b-b24a-2624ee037d4f","block_type":"box","text":"We recognize that the specific sustainability-related factors that may be financially material or business","page_number":217,"box":{"x":116,"y":226,"width":769,"height":12}},{"id":"4a615b11-47fe-49c8-b279-85f59da6dd9e","block_type":"box","text":"relevant will vary by company business model, sector, key markets, and time horizon, amongst other","page_number":217,"box":{"x":117,"y":241,"width":751,"height":12}},{"id":"f434ee07-2749-4ef4-8299-a8e4cd610ff8","block_type":"box","text":"considerations. From company disclosures and our engagement, we aim to understand how","page_number":217,"box":{"x":116,"y":257,"width":689,"height":12}},{"id":"84d70ee9-f24e-45bd-aedc-feaa6cb29282","block_type":"box","text":"management is identifying, assessing and integrating material sustainability-related risks and","page_number":217,"box":{"x":117,"y":272,"width":694,"height":12}},{"id":"0b236909-23db-4fc7-8783-87d3ef93e823","block_type":"box","text":"opportunities into their business decision-making and practices. Doing so helps us undertake a more","page_number":217,"box":{"x":116,"y":288,"width":752,"height":12}},{"id":"5ab9e12b-dd4f-4c83-bb37-8d5a74289ba6","block_type":"box","text":"holistic assessment of a company’s potential financial performance and the likely risk-adjusted returns","page_number":217,"box":{"x":117,"y":303,"width":761,"height":12}},{"id":"f4ff4782-3516-4a35-a425-f4728f1f1a9f","block_type":"box","text":"of an investment.","page_number":217,"box":{"x":116,"y":319,"width":133,"height":9}},{"id":"063a7f47-e0f4-4b98-b26d-2289198b489d","block_type":"box","text":"We may vote against directors or support a relevant shareholder proposal if we have concerns about","page_number":217,"box":{"x":116,"y":349,"width":753,"height":13}},{"id":"afe0f7fd-9171-4923-afd0-3b2509f527ef","block_type":"box","text":"how a company is managing or disclosing its approach to material sustainability-related risks that may","page_number":217,"box":{"x":117,"y":365,"width":761,"height":12}},{"id":"5cff94fd-10fe-4ea5-8f87-ce9c6d5539b6","block_type":"box","text":"impact financial returns.","page_number":217,"box":{"x":117,"y":380,"width":181,"height":12}},{"id":"49e78d46-156c-47b8-a995-5e295a372240","block_type":"box","text":"Key stakeholders","page_number":217,"box":{"x":431,"y":419,"width":143,"height":12}},{"id":"a38b8ec7-1326-47b6-9f43-009167a62026","block_type":"box","text":"In our view, companies should understand and take into consideration the interests of the various","page_number":217,"box":{"x":117,"y":449,"width":727,"height":12}},{"id":"0b1adca9-b22b-43af-99c3-af79f5b3f8ae","block_type":"box","text":"parties on whom they depend for their success over time. It is for each company to determine their key","page_number":217,"box":{"x":117,"y":465,"width":766,"height":12}},{"id":"663b4b83-2684-4334-b717-44cb153db2ec","block_type":"box","text":"stakeholders based on what is material to their business and long-term financial performance. For","page_number":217,"box":{"x":116,"y":480,"width":731,"height":12}},{"id":"c44e3a6b-8d83-4315-8645-a054a4c234b9","block_type":"box","text":"many companies, key stakeholders include employees, business partners (such as suppliers and","page_number":217,"box":{"x":117,"y":496,"width":726,"height":12}},{"id":"ac11b34d-6c9a-48a5-9b40-43f531a58087","block_type":"box","text":"distributors), clients and consumers, regulators, and the communities in which they operate.","page_number":217,"box":{"x":116,"y":511,"width":687,"height":12}},{"id":"49ebc6fc-099d-4bf3-a445-969326029af6","block_type":"box","text":"Companies that appropriately balance the interests of investors and other stakeholders are, in our","page_number":217,"box":{"x":117,"y":527,"width":730,"height":12}},{"id":"f1e25143-d1a6-4c47-bfa7-34ebf9d6d2ca","block_type":"box","text":"experience, more likely to be financially resilient over time.","page_number":217,"box":{"x":116,"y":542,"width":438,"height":12}},{"id":"83904635-2f5e-4c9f-8a17-9f5981f0f39b","block_type":"box","text":"Climate and decarbonization investment objectives","page_number":217,"box":{"x":295,"y":581,"width":414,"height":12}},{"id":"f770764a-ee32-449a-a6ad-c21b39d9ef70","block_type":"box","text":"Certain active BlackRock funds have climate and decarbonization objectives in addition to financial","page_number":217,"box":{"x":117,"y":611,"width":737,"height":12}},{"id":"74ed0bfb-4d0c-4a64-8da2-e4566470e194","block_type":"box","text":"objectives. Consistent with the objectives of those investment strategies, our stewardship activity in","page_number":217,"box":{"x":116,"y":627,"width":741,"height":12}},{"id":"134b1b08-8b4a-4f2a-a463-b62336f385c7","block_type":"box","text":"relation to the holdings in those funds differs in some respects from BAIS’ benchmark guidelines, which","page_number":217,"box":{"x":117,"y":642,"width":771,"height":12}},{"id":"427c9ca8-17d4-4a93-98d5-a3affd31eb31","block_type":"box","text":"are described above. Specifically, for those funds’ holdings, we look to investee companies to","page_number":217,"box":{"x":116,"y":658,"width":699,"height":12}},{"id":"1b111418-23c9-4a5e-864d-7242c4c78cc1","block_type":"box","text":"demonstrate that they are aligned with a decarbonization pathway that means their business model","page_number":217,"box":{"x":116,"y":673,"width":736,"height":12}},{"id":"8a30b05e-add8-4c55-bb7c-6d9dd7737c88","block_type":"box","text":"would be viable in a low-carbon economy, i.e., one in which global temperature rise is limited to 1.5°C","page_number":217,"box":{"x":116,"y":689,"width":754,"height":12}},{"id":"bedaec74-2d10-4d8c-b3bb-94b064df7a9a","block_type":"box","text":"above pre-industrial levels. In addition, clients in separately managed accounts may instruct BlackRock","page_number":217,"box":{"x":116,"y":704,"width":766,"height":12}},{"id":"44c27472-59b4-45f2-a681-18fa0d9dc4f5","block_type":"box","text":"to apply these guidelines to their holdings. Both in the case of funds and separately managed","page_number":217,"box":{"x":116,"y":720,"width":692,"height":12}},{"id":"67bf87ae-459f-4f21-b475-8732114e929a","block_type":"box","text":"accounts, these guidelines are only implemented upon explicit selection and approval by the applicable","page_number":217,"box":{"x":116,"y":735,"width":765,"height":12}},{"id":"dbfcdd6e-ca54-41ec-860d-47b934ca685e","block_type":"box","text":"fund board or client.","page_number":217,"box":{"x":116,"y":751,"width":147,"height":9}},{"id":"5e1daa10-93a7-4e21-8ff3-7f2b84971278","block_type":"box","text":"11","page_number":217,"box":{"x":144,"y":776,"width":7,"height":5}},{"id":"b8be2907-228e-4048-ac6d-20c97117f019","block_type":"box","text":"By material sustainability-related risks and opportunities, we mean the drivers of risk and financial value creation in a","page_number":217,"box":{"x":171,"y":776,"width":691,"height":10}},{"id":"10e81858-97d1-4d59-975c-22544d036f7d","block_type":"box","text":"company’s business model that have an environmental or social dependency or impact. Examples of environmental","page_number":217,"box":{"x":170,"y":789,"width":686,"height":9}},{"id":"da19e3df-604d-4522-84af-a18db28fec53","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":217,"box":{"x":170,"y":802,"width":682,"height":9}},{"id":"9387c35d-4dcd-4051-916f-f44388ad97e6","block_type":"box","text":"issues include, but are not limited to, human capital management, impacts on the communities in which a company","page_number":217,"box":{"x":170,"y":815,"width":683,"height":9}},{"id":"e223e72a-524c-43e1-acd4-716f3f294890","block_type":"box","text":"operates, customer loyalty, and relationships with regulators. It is our view that well-managed companies will effectively","page_number":217,"box":{"x":170,"y":828,"width":708,"height":9}},{"id":"822669ee-d023-40be-9bc5-fb346977eac1","block_type":"box","text":"evaluate and manage material sustainability-related risks and opportunities relevant to their businesses. Governance is","page_number":217,"box":{"x":170,"y":840,"width":707,"height":10}},{"id":"6b79ec2d-5caa-43af-b8f2-fd717465741b","block_type":"box","text":"the core means by which boards can oversee the creation of durable financial value over time. Appropriate risk","page_number":217,"box":{"x":170,"y":853,"width":658,"height":10}},{"id":"a9cb4174-7cb9-472f-848d-bad8697e6f72","block_type":"box","text":"oversight of business-relevant and material sustainability-related considerations is a component of a sound governance","page_number":217,"box":{"x":170,"y":866,"width":708,"height":10}},{"id":"edf7af37-8a30-4253-b0c1-42fbed5121ef","block_type":"box","text":"framework.","page_number":217,"box":{"x":170,"y":879,"width":65,"height":8}},{"id":"f0d738e0-cbc0-4b0e-ae0f-10055d6be893","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":217,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"5150d77f-072e-47d5-ac38-d049e51725dd","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":217,"box":{"x":530,"y":909,"width":324,"height":12}},{"id":"bccf64dd-caa4-4c02-a2fa-74420b38bcf2","block_type":"box","text":"16","page_number":217,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"fba9059f-a352-47c6-995f-65e77bd27cf9","block_type":"box","text":"NM0926U-5926888-217/257","page_number":217,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"323da6e0-c12c-4b34-947c-bb076b25bf03","block_type":"box","text":"These decarbonization stewardship guidelines focus on companies which produce goods and services","page_number":218,"box":{"x":116,"y":87,"width":766,"height":12}},{"id":"985f06ab-0bd1-42eb-a679-e17a87fb9124","block_type":"box","text":"that contribute to real world decarbonization or have a carbon intensive business model and face","page_number":218,"box":{"x":116,"y":102,"width":724,"height":10}},{"id":"36dea97e-85ca-49d3-a6fe-70aa7f179ef2","block_type":"box","text":"outsized impacts from the low carbon transition, based on reported and estimated scopes 1, 2, and 3","page_number":218,"box":{"x":116,"y":118,"width":754,"height":12}},{"id":"d856c44d-24f7-45ba-8904-c6f1cb8ef4b2","block_type":"box","text":"greenhouse gas emissions. These companies should provide disclosures that set out their","page_number":218,"box":{"x":116,"y":134,"width":675,"height":12}},{"id":"3d77eb35-554e-45c4-8817-00e93b008635","block_type":"box","text":"governance, strategy, risk management processes and metrics and targets relevant to","page_number":218,"box":{"x":116,"y":149,"width":646,"height":12}},{"id":"9ddbce4a-7ae8-4d4f-843d-ab7270fc0af6","block_type":"box","text":"decarbonization. It is helpful to investors’ understanding when these disclosures include an explanation","page_number":218,"box":{"x":116,"y":165,"width":770,"height":12}},{"id":"2d3c2cad-0177-4bcb-971b-71d6dc49ec61","block_type":"box","text":"of the decarbonization scenarios a company is using in its near- and long-term planning, as well as its","page_number":218,"box":{"x":116,"y":180,"width":760,"height":12}},{"id":"16020649-62fe-411d-8501-807ae42a8f1c","block_type":"box","text":"scope 1, scope 2 and material scope 3 greenhouse gas (GHG) emissions and reduction targets for","page_number":218,"box":{"x":116,"y":196,"width":739,"height":12}},{"id":"22ca5a93-c6b2-488c-87d8-6e7e6476015e","block_type":"box","text":"scope 1 and 2 emissions.","page_number":218,"box":{"x":116,"y":211,"width":194,"height":12}},{"id":"f6550abf-4656-48f2-8cab-0cf8c1dfaf00","block_type":"box","text":"Under these climate- and decarbonization-specific guidelines, BAIS may recommend a vote against","page_number":218,"box":{"x":117,"y":242,"width":744,"height":12}},{"id":"b03f987e-48c6-44eb-bcc8-0ae2d394563a","block_type":"box","text":"directors or support for a relevant shareholder proposal if a company does not appear to be adequately","page_number":218,"box":{"x":116,"y":258,"width":771,"height":12}},{"id":"eb76ec7a-486f-4006-86c2-d75b9c29674f","block_type":"box","text":"acting to address or disclosing material climate-related risks, consistent with the parameters set out in","page_number":218,"box":{"x":116,"y":273,"width":761,"height":12}},{"id":"9babe4e7-6df1-4e78-8527-ee64f25374df","block_type":"box","text":"these climate- and decarbonization-specific guidelines. We may recommend supporting shareholder","page_number":218,"box":{"x":116,"y":289,"width":749,"height":12}},{"id":"506eadc8-476b-4d0e-95e8-33cf4d9c1da6","block_type":"box","text":"proposals seeking information relevant to a company’s stated low-carbon transition strategy or targets","page_number":218,"box":{"x":117,"y":304,"width":760,"height":12}},{"id":"032f1eb2-3feb-4760-99fa-23ff7d6304fb","block_type":"box","text":"that the company does not currently provide and that would be helpful to investment decision-making.","page_number":218,"box":{"x":116,"y":320,"width":760,"height":12}},{"id":"52d52131-feb7-4618-ad77-7009cf7fc396","block_type":"box","text":"We would not recommend support for shareholder proposals that seek to constrain board or","page_number":218,"box":{"x":116,"y":335,"width":689,"height":12}},{"id":"d6b067ea-91ad-40d7-8064-fc0acd5c7b4b","block_type":"box","text":"management decision-making or direct specific business or strategic decisions. As under the BAIS","page_number":218,"box":{"x":117,"y":351,"width":736,"height":12}},{"id":"55cbba4b-fd28-4ec8-b5fc-155c60ed561e","block_type":"box","text":"benchmark approach, the active portfolio managers are ultimately responsible for voting consistent","page_number":218,"box":{"x":117,"y":366,"width":737,"height":12}},{"id":"48dd2603-6b74-47dd-b613-ad7d950e1c70","block_type":"box","text":"with their investment mandate and fund objectives. For the funds and accounts in scope, voting on","page_number":218,"box":{"x":116,"y":382,"width":736,"height":12}},{"id":"86676fb3-3078-4503-8a17-e8eaacbe4f6d","block_type":"box","text":"matters not related to climate risk and the energy transition is undertaken in line with BAIS’ benchmark","page_number":218,"box":{"x":117,"y":397,"width":765,"height":12}},{"id":"541f6c36-5f4e-42c5-a016-f5f7051249ab","block_type":"box","text":"guidelines.","page_number":218,"box":{"x":116,"y":413,"width":85,"height":12}},{"id":"8203c35d-71f0-4493-9040-1222880c96ee","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":218,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"cb4421b1-393c-4dab-be54-eaa5aa9634db","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":218,"box":{"x":530,"y":909,"width":324,"height":12}},{"id":"e86d1e5b-dfac-471d-990d-0861bac30e02","block_type":"box","text":"17","page_number":218,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"a0cbf538-970c-4b70-9d5f-c9625a16dee2","block_type":"box","text":"NM0926U-5926888-218/257","page_number":218,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"792a42c7-5ea7-4d20-915e-7560ff52767d","block_type":"box","text":"Appendix 1: How we fulfil and oversee our investment stewardship responsibilities","page_number":219,"box":{"x":168,"y":87,"width":668,"height":12}},{"id":"07c62669-4bea-49b0-bbb0-2adbc62ee85b","block_type":"box","text":"Oversight","page_number":219,"box":{"x":116,"y":118,"width":83,"height":12}},{"id":"ee74f446-7cde-49c8-a797-3e6ae5744ffa","block_type":"box","text":"The Global Head of BAIS has primary oversight of and responsibility for the team’s activities, including","page_number":219,"box":{"x":116,"y":149,"width":764,"height":12}},{"id":"bf2efad5-0e43-41a7-b404-bcd6fdb5b138","block_type":"box","text":"voting in accordance with the BlackRock Active Investment Stewardship Global Engagement and","page_number":219,"box":{"x":116,"y":165,"width":726,"height":12}},{"id":"24f67b62-1d2a-48ff-aad2-84eca7109ff2","block_type":"box","text":"Voting Guidelines (the “Guidelines”), which require the application of professional judgment and","page_number":219,"box":{"x":116,"y":180,"width":714,"height":12}},{"id":"cf834efc-88df-4861-8572-24217d074326","block_type":"box","text":"consideration of each company’s unique circumstances, as well as input from active investors. BAIS is","page_number":219,"box":{"x":116,"y":196,"width":765,"height":12}},{"id":"1cc1fffc-94af-4b20-b3f1-5340657c6d91","block_type":"box","text":"independent from BlackRock Investment Stewardship in our engagement and voting activities,","page_number":219,"box":{"x":117,"y":211,"width":704,"height":12}},{"id":"6554531f-bf16-429b-a7dd-09ecb9816bef","block_type":"box","text":"reporting lines, and oversight.","page_number":219,"box":{"x":117,"y":227,"width":224,"height":12}},{"id":"793489a2-2c70-470a-b4e7-7f5423f6dc70","block_type":"box","text":"The Stewardship Leaders Group, comprised of senior active investors and other relevant stakeholders","page_number":219,"box":{"x":116,"y":258,"width":765,"height":11}},{"id":"3c863b35-c592-4394-a5fe-78427c3f3add","block_type":"box","text":"in BlackRock’s legal, public policy, sustainability and communications teams, helps shape the firm’s","page_number":219,"box":{"x":117,"y":273,"width":742,"height":12}},{"id":"f20b6293-afec-4cf3-9e2b-bcf889146088","block_type":"box","text":"approach to investment stewardship on non-index equity investment strategies. The Group may advise","page_number":219,"box":{"x":116,"y":289,"width":769,"height":12}},{"id":"524484da-fc9f-497f-bca3-82076eefd357","block_type":"box","text":"on and review amendments to BAIS’ policies and practices. It does not determine voting decisions,","page_number":219,"box":{"x":116,"y":304,"width":739,"height":12}},{"id":"60c639d5-9920-40b4-8a8e-a128ac56f20a","block_type":"box","text":"which are the responsibility of BAIS and the relevant active equity investors.","page_number":219,"box":{"x":116,"y":320,"width":568,"height":12}},{"id":"dd590379-23ec-460e-9e90-1185aefea2f0","block_type":"box","text":"BAIS carries out engagement with companies in collaboration with active investment colleagues,","page_number":219,"box":{"x":117,"y":351,"width":721,"height":12}},{"id":"f3d71fd1-0122-472e-a447-6ac1cac2d926","block_type":"box","text":"executes proxy votes, and conducts vote operations (including maintaining records of votes cast) in a","page_number":219,"box":{"x":116,"y":366,"width":757,"height":12}},{"id":"e1f39847-c50e-440c-a557-f6831d6bbf70","block_type":"box","text":"manner consistent with the Guidelines. BAIS also conducts research on corporate governance issues","page_number":219,"box":{"x":117,"y":382,"width":757,"height":12}},{"id":"5c4116d9-c3ee-49bf-8ce8-790e42ed9b64","block_type":"box","text":"and participates in industry discussions to contribute to and keep abreast of important developments in","page_number":219,"box":{"x":116,"y":397,"width":768,"height":12}},{"id":"0d341480-4ce4-4335-9693-8daae3785fa7","block_type":"box","text":"the corporate governance field. BAIS may use third parties for certain of the foregoing activities and","page_number":219,"box":{"x":116,"y":413,"width":744,"height":12}},{"id":"7d36c54c-46da-4035-9fca-b15058796608","block_type":"box","text":"performs oversight of those third parties (see “Use and oversight of third-party vote services providers”","page_number":219,"box":{"x":117,"y":428,"width":765,"height":12}},{"id":"398082e1-f666-4327-b58e-09733137a442","block_type":"box","text":"below).","page_number":219,"box":{"x":117,"y":444,"width":58,"height":12}},{"id":"96cd71fa-7a13-4d71-8772-77caf3dfb563","block_type":"box","text":"Voting guidelines and vote execution","page_number":219,"box":{"x":116,"y":475,"width":302,"height":12}},{"id":"9767687e-84ed-42b9-b746-37c4a7a9a359","block_type":"box","text":"BlackRock votes on proxy issues when our clients authorize us to do so. We carefully consider the","page_number":219,"box":{"x":117,"y":506,"width":735,"height":12}},{"id":"1731bc18-e70b-4217-9dcf-9f7f0ae1acf1","block_type":"box","text":"voting items submitted to funds and other fiduciary account(s) (Fund or Funds) for which we have","page_number":219,"box":{"x":116,"y":521,"width":728,"height":12}},{"id":"f853a8cd-a632-44da-b045-cec6ebad8081","block_type":"box","text":"voting authority. BlackRock votes (or refrains from voting) for each Fund for which we have voting","page_number":219,"box":{"x":116,"y":537,"width":730,"height":12}},{"id":"7998c21d-e0e0-430d-a18b-ebd9fd894e93","block_type":"box","text":"authority based on our evaluation of the alignment of the voting items with the long-term economic","page_number":219,"box":{"x":116,"y":552,"width":734,"height":12}},{"id":"18f343c0-5bd4-469b-afba-07220ebca29e","block_type":"box","text":"interests of our clients, in the exercise of our independent business judgment, and without regard to the","page_number":219,"box":{"x":117,"y":568,"width":771,"height":12}},{"id":"9033abdb-68a4-491e-ba80-653175a8a7a3","block_type":"box","text":"relationship of the issuer (or any shareholder proponent or dissident shareholder) to the Fund, the","page_number":219,"box":{"x":117,"y":583,"width":730,"height":12}},{"id":"b262ab8d-b3b7-4331-956d-1cad0a8ca4a2","block_type":"box","text":"Fund’s affiliates (if any), BlackRock or BlackRock’s affiliates, or BlackRock employees (see “Conflicts","page_number":219,"box":{"x":117,"y":599,"width":754,"height":12}},{"id":"9d7ca04f-bcca-48b5-ac96-58f7f1a298b4","block_type":"box","text":"management policies and procedures,” below).","page_number":219,"box":{"x":117,"y":614,"width":353,"height":12}},{"id":"b7ac095e-ea9f-4931-aa05-5cad55fcc192","block_type":"box","text":"When exercising voting rights, BAIS will normally vote on specific proxy issues in accordance with the","page_number":219,"box":{"x":116,"y":645,"width":759,"height":12}},{"id":"0cbf97a2-7951-4ad4-85d0-94cecebab8a9","block_type":"box","text":"Guidelines, although portfolio managers have the right to vote differently on their holdings if they","page_number":219,"box":{"x":117,"y":661,"width":713,"height":12}},{"id":"79d6f863-ab0d-49f0-838f-f021245ca6c5","block_type":"box","text":"determine doing so is more aligned with the investment objective and financial interests of clients","page_number":219,"box":{"x":116,"y":676,"width":719,"height":12}},{"id":"fff0f5da-20dd-451c-96b3-0f7b81485966","block_type":"box","text":"invested in the funds they manage.","page_number":219,"box":{"x":117,"y":692,"width":258,"height":12}},{"id":"67a9e7bc-1e32-48ff-90fa-5279743cda3d","block_type":"box","text":"The Guidelines are not intended to be exhaustive. BAIS applies the Guidelines on a case-by-case","page_number":219,"box":{"x":116,"y":723,"width":726,"height":12}},{"id":"cae16478-a0b0-4184-b7db-0df2228f2bf0","block_type":"box","text":"basis, in the context of the individual circumstances of each company and the specific issue under","page_number":219,"box":{"x":117,"y":738,"width":728,"height":12}},{"id":"1881db5f-0855-4121-a8b2-cba989540a0f","block_type":"box","text":"review. As such, the Guidelines do not indicate how BAIS will vote in every instance. Rather, they","page_number":219,"box":{"x":117,"y":754,"width":723,"height":12}},{"id":"a8d5f81f-5f51-446c-bcfb-c0356040c02f","block_type":"box","text":"reflect our view about corporate governance issues generally, and provide insight into how we typically","page_number":219,"box":{"x":117,"y":769,"width":761,"height":12}},{"id":"683772b6-7a3f-47c6-8aac-1417d88db069","block_type":"box","text":"approach issues that are commonly put to a shareholder vote. The Guidelines are reviewed annually","page_number":219,"box":{"x":116,"y":785,"width":747,"height":12}},{"id":"aeb6f0c0-2584-4eb4-9311-817f96aebf63","block_type":"box","text":"and updated as necessary to reflect changes in market practices, developments in corporate","page_number":219,"box":{"x":116,"y":800,"width":688,"height":12}},{"id":"7f5263af-094a-4827-9a62-ad82951c4f50","block_type":"box","text":"governance and feedback from companies and clients. In this way, BAIS aims to maintain policies that","page_number":219,"box":{"x":116,"y":816,"width":760,"height":12}},{"id":"e42a2c95-6ecd-43f0-8e24-34aac6b21b77","block_type":"box","text":"explain our approach to governance practices most aligned with clients’ long-term financial interests.","page_number":219,"box":{"x":116,"y":831,"width":751,"height":12}},{"id":"e1a70516-3778-4226-9065-f455d7cb8a1a","block_type":"box","text":"In certain markets, proxy voting involves logistical issues which can affect BAIS’ ability to vote such","page_number":219,"box":{"x":117,"y":862,"width":740,"height":12}},{"id":"e525551e-2fe8-4112-a70d-64be3f389c63","block_type":"box","text":"proxies, as well as the desirability of voting such proxies. These issues include, but are not limited to: i)","page_number":219,"box":{"x":117,"y":878,"width":768,"height":12}},{"id":"474b2c32-7e49-4fc8-a1ba-3cd80368a169","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":219,"box":{"x":117,"y":909,"width":338,"height":12}},{"id":"89493d37-1a57-4fd7-ba64-ffadeef9ec41","block_type":"box","text":"Global Engagement and Voting Guidelines |","page_number":219,"box":{"x":530,"y":909,"width":324,"height":12}},{"id":"ec3e1f2e-282c-45e8-9f9a-dd8d969924c3","block_type":"box","text":"18","page_number":219,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"afb33630-ee2f-48ee-839f-5fb553687a3e","block_type":"box","text":"NM0926U-5926888-219/257","page_number":219,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"decacc0d-e46b-45b3-ac30-b3befc267e0f","block_type":"box","text":"untimely notice of shareholder meetings; ii) restrictions on a foreigner’s ability to exercise votes; iii)","page_number":220,"box":{"x":117,"y":87,"width":735,"height":12}},{"id":"f275db13-f9c1-4bf9-80fb-dba38c84858e","block_type":"box","text":"requirements to vote proxies in person; iv) “share-blocking” (requirements that investors who exercise","page_number":220,"box":{"x":117,"y":102,"width":759,"height":13}},{"id":"185449c9-3e2c-4f87-8915-d0116df98a4d","block_type":"box","text":"their voting rights surrender the right to dispose of their holdings from the point at which votes are","page_number":220,"box":{"x":116,"y":118,"width":728,"height":12}},{"id":"286a7a01-0d68-4e47-b10e-72b4422177cc","block_type":"box","text":"submitted until after the after the shareholder meeting has occurred); v) potential difficulties in","page_number":220,"box":{"x":116,"y":134,"width":700,"height":12}},{"id":"8705d695-d29b-4aff-b681-b3910407e558","block_type":"box","text":"translating the proxy; vi) regulatory constraints; and vii) requirements to provide local agents with","page_number":220,"box":{"x":116,"y":149,"width":723,"height":12}},{"id":"341f6299-00bf-4aac-a2ad-331c64671167","block_type":"box","text":"powers of attorney to facilitate voting instructions. We are not supportive of impediments to the","page_number":220,"box":{"x":117,"y":165,"width":706,"height":12}},{"id":"d1d38160-ecb3-46dd-8f6b-51c851bd0c03","block_type":"box","text":"exercise of voting rights such as share-blocking or overly burdensome administrative requirements.","page_number":220,"box":{"x":116,"y":180,"width":742,"height":12}},{"id":"2816c660-3a84-49f6-b44b-b42816f64ec8","block_type":"box","text":"BlackRock votes proxies in these situations on a “best-efforts” basis. 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Reliance upon this","page_number":223,"box":{"x":116,"y":769,"width":748,"height":12}},{"id":"48d1564e-f050-43fa-a000-d207bb5ea800","block_type":"box","text":"information is at the sole discretion of the reader.","page_number":223,"box":{"x":117,"y":785,"width":361,"height":9}},{"id":"0ffc8742-127e-4306-b258-af89b7bac6fd","block_type":"box","text":"Prepared by BlackRock, Inc.","page_number":223,"box":{"x":117,"y":816,"width":209,"height":12}},{"id":"ad09e14e-8ae9-4b89-8be9-28b1d93fabc9","block_type":"box","text":"©","page_number":223,"box":{"x":116,"y":846,"width":9,"height":7}},{"id":"f0d2f7af-2301-4dac-97a1-550f4f9b243c","block_type":"box","text":"2025 BlackRock, Inc. All rights reserved. BLACKROCK is a trademark of BlackRock, Inc., or its","page_number":223,"box":{"x":125,"y":847,"width":712,"height":12}},{"id":"fbdfa17b-a9b0-48e2-88ae-b59b3779a796","block_type":"box","text":"subsidiaries in the United States and elsewhere. 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Reporting on our activities to inform clients","page_number":229,"box":{"x":150,"y":383,"width":382,"height":12}},{"id":"72f3f1ab-4d2e-4760-a0d3-ca64c93a9721","block_type":"box","text":"about our stewardship efforts on their behalf","page_number":229,"box":{"x":532,"y":383,"width":338,"height":12}},{"id":"b2629917-0a15-4a43-a27f-e0f76e655592","block_type":"box","text":"through a range of publications on our website and direct client communications.","page_number":229,"box":{"x":183,"y":398,"width":603,"height":12}},{"id":"a4fcd218-f8b2-45d2-9b3b-b41e23b2680f","block_type":"box","text":"This document provides an overarching explanation of the principles that guide our approach to","page_number":229,"box":{"x":116,"y":426,"width":713,"height":12}},{"id":"1213c629-6443-4e98-92bb-c5740ba9c1a9","block_type":"box","text":"engaging and voting on corporate governance matters and other material risks and opportunities under","page_number":229,"box":{"x":116,"y":441,"width":770,"height":12}},{"id":"94370fc8-0e08-4a86-90c7-c39ae5ea8403","block_type":"box","text":"BIS’ Benchmark Policies. 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We maintain","page_number":229,"box":{"x":488,"y":564,"width":352,"height":12}},{"id":"4d1daddf-3d3a-4aab-b079-d817270e2e0f","block_type":"box","text":"global principles on corporate governance, which gui","page_number":229,"box":{"x":116,"y":580,"width":382,"height":12}},{"id":"fb756d3d-aa86-45a3-b055-77e3f5a7fae7","block_type":"box","text":"de our approach to stewardship across jurisdictions,","page_number":229,"box":{"x":499,"y":580,"width":383,"height":12}},{"id":"cf746d89-949c-43c1-b234-2afd7f364e0b","block_type":"box","text":"while recognizing the unique characteristics of t","page_number":229,"box":{"x":116,"y":595,"width":344,"height":12}},{"id":"d615a6c7-4bfb-48c9-8260-d951f3d99f9b","block_type":"box","text":"he different markets where companies operate.","page_number":229,"box":{"x":461,"y":595,"width":348,"height":12}},{"id":"bcaab6bf-3ac9-4657-83df-2e12d24f7d8d","block_type":"box","text":"Setting, executing, and overseeing strategy are the responsibility of management and the board. As","page_number":229,"box":{"x":116,"y":623,"width":746,"height":12}},{"id":"8503625f-9b65-475d-997a-22580dc8163d","block_type":"box","text":"one of many minority shareholders in public companies, BlackRock does not direct a company’s","page_number":229,"box":{"x":116,"y":638,"width":718,"height":12}},{"id":"241385dd-aca0-47aa-8bbe-59b9d02a759c","block_type":"box","text":"strategy or its implementation, nor how they should manage material business risks. Our role, on","page_number":229,"box":{"x":116,"y":654,"width":723,"height":12}},{"id":"7bc31d82-e7fd-44c1-b0f5-d159e553ce41","block_type":"box","text":"behalf of clients as long-term investors, is to better understand how corporate leadership is managing","page_number":229,"box":{"x":117,"y":669,"width":751,"height":12}},{"id":"f6bcc301-ccbe-4472-84f6-0c9e72b00499","block_type":"box","text":"material risks and capitalizing on opportunities to help protect and enhance the company’s ability to","page_number":229,"box":{"x":117,"y":685,"width":735,"height":12}},{"id":"03f00949-4a91-4747-ac0b-3538dbd64967","block_type":"box","text":"deliver long-term financial returns.","page_number":229,"box":{"x":116,"y":700,"width":252,"height":12}},{"id":"f681e2b5-b3eb-4868-b82b-e69063e3f867","block_type":"box","text":"Stewardship in practice","page_number":229,"box":{"x":406,"y":734,"width":187,"height":12}},{"id":"a38b9b5c-d8c4-4df9-862e-0dbe0374db1f","block_type":"box","text":"The assets BlackRock manages belong to our clients, which include public and private pension","page_number":229,"box":{"x":116,"y":761,"width":705,"height":12}},{"id":"d79f610a-9695-45d1-b9c0-97b3311d0738","block_type":"box","text":"plans, insurers, official institutions, endowments, universities, charities, family offices, wealth","page_number":229,"box":{"x":117,"y":777,"width":683,"height":12}},{"id":"2993e3b3-b6d3-4846-87ee-674352742b2b","block_type":"box","text":"1","page_number":229,"box":{"x":144,"y":802,"width":2,"height":5}},{"id":"4f83ca38-cdfa-4e4b-bb91-058aaeace557","block_type":"box","text":"On February 11, 2025, the U.S. Securities and Exchange Commission (SEC) staff issued updated guidance for","page_number":229,"box":{"x":170,"y":802,"width":660,"height":9}},{"id":"d182fcb1-0d6d-42c2-8546-6be37416957e","block_type":"box","text":"shareholders to maintain their eligibility to report their beneficial ownership under Schedule 13G of the Exchange Act.","page_number":229,"box":{"x":170,"y":815,"width":695,"height":9}},{"id":"93a0d517-e3b5-45bb-8ec2-95eb4ce3cb2e","block_type":"box","text":"We comply fully with these requirements and do not engage with portfolio companies for the purpose, or with the effect,","page_number":229,"box":{"x":170,"y":828,"width":707,"height":9}},{"id":"45264301-aea3-41b8-99e5-31f40152b157","block_type":"box","text":"of changing or influencing control of any company.","page_number":229,"box":{"x":170,"y":840,"width":298,"height":10}},{"id":"a6b7cc54-28f4-4c77-ab01-92ef6ff92de0","block_type":"box","text":"2","page_number":229,"box":{"x":143,"y":853,"width":4,"height":5}},{"id":"d087c046-86e3-470c-860b-312d46e823c0","block_type":"box","text":"Alongside the Global Principles and regional voting guidelines, BIS publishes Engagement Priorities which reflect the","page_number":229,"box":{"x":170,"y":853,"width":695,"height":10}},{"id":"7a6f5a3c-17c4-464f-803f-5327d6c04fb9","block_type":"box","text":"five themes on which we most frequently engage companies, where they are relevant, as these can be a source of","page_number":229,"box":{"x":170,"y":866,"width":680,"height":10}},{"id":"a6c7eb1a-9ced-4308-8459-1fccc9ff18fd","block_type":"box","text":"material business risk or opportunity.","page_number":229,"box":{"x":170,"y":879,"width":218,"height":10}},{"id":"a5ee18ae-2a3b-41b9-8084-4d6cbf0a6d67","block_type":"box","text":"BlackRock Investment Stewardship","page_number":229,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"b6a22a76-59a5-415d-879b-d9c760fd8aea","block_type":"box","text":"Global Principles |","page_number":229,"box":{"x":735,"y":909,"width":133,"height":12}},{"id":"c3d828b0-7f83-4a4a-8d64-179cbab72906","block_type":"box","text":"3","page_number":229,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"c4b4738e-118a-41b9-8bae-fd3bb8066318","block_type":"box","text":"NM0926U-5926888-229/257","page_number":229,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"41872a01-b408-409a-8380-de3b1cede4af","block_type":"box","text":"managers, and ultimately, the individual investors that they serve. 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Our stewardship program – including when engaging with","page_number":230,"box":{"x":116,"y":118,"width":730,"height":12}},{"id":"bc17a90b-d1ea-4e5b-bba1-90d7eb40f5d8","block_type":"box","text":"companies and voting at shareholder meetings on behalf of clients – is conducted from a long-term","page_number":230,"box":{"x":116,"y":134,"width":740,"height":12}},{"id":"ee8158de-8a82-47c4-92b1-4b4aa5619837","block_type":"box","text":"investor perspective and takes a financial materiality-based approach, focused solely on advancing","page_number":230,"box":{"x":117,"y":149,"width":740,"height":12}},{"id":"6a7639f6-87cb-4610-b275-066a30c7ce57","block_type":"box","text":"clients’ long-term financial interests.","page_number":230,"box":{"x":116,"y":165,"width":271,"height":12}},{"id":"80653e73-9c72-479e-ae64-31f616a08999","block_type":"box","text":"BIS engages with the boards and management of companies in which clients are invested to deepen","page_number":230,"box":{"x":117,"y":192,"width":753,"height":13}},{"id":"ccac865a-6fe5-4631-a517-d1b0fbd90448","block_type":"box","text":"our understanding of a company’s business model, including how they are overseeing material","page_number":230,"box":{"x":116,"y":208,"width":708,"height":12}},{"id":"263e342d-8cdd-47d6-ac0c-a8c78d6cc2cd","block_type":"box","text":"business risks and opportunities over time, and to help inform our voting on behalf of clients.","page_number":230,"box":{"x":117,"y":223,"width":689,"height":13}},{"id":"18a26e49-2113-44f3-a011-c5d8726e4885","block_type":"box","text":"Engagements provide companies with the opportunity to share their perspectives on topics that, in BIS’","page_number":230,"box":{"x":117,"y":239,"width":769,"height":12}},{"id":"16d1ea63-4cb4-4ead-a9e2-30dfe032ad00","block_type":"box","text":"experience, impact the long-term financial returns BlackRock’s clients depend on to meet their financial","page_number":230,"box":{"x":116,"y":254,"width":771,"height":13}},{"id":"43da8e95-c124-450d-9a86-168019b6808d","block_type":"box","text":"goals.","page_number":230,"box":{"x":116,"y":270,"width":49,"height":12}},{"id":"471a9300-26f8-4523-b5f0-f389203cec0b","block_type":"box","text":"Voting at a company’s shareholder meeting is a right of share ownership and a core principle of","page_number":230,"box":{"x":116,"y":298,"width":713,"height":12}},{"id":"2f55feab-279d-4ca7-9f0b-4c1ba03f5b2d","block_type":"box","text":"corporate governance. 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Our vote decisions are often informed by several factors, including in-depth","page_number":230,"box":{"x":117,"y":375,"width":706,"height":12}},{"id":"76365202-7fe4-44c4-a93c-dd2957242681","block_type":"box","text":"analysis of company disclosures, comparisons against industry peers, third-party research, and, where","page_number":230,"box":{"x":116,"y":391,"width":768,"height":12}},{"id":"efbeb383-626d-4dd2-a413-afa378d949ae","block_type":"box","text":"appropriate, engagement with companies.","page_number":230,"box":{"x":116,"y":407,"width":318,"height":11}},{"id":"be6eb298-0282-4e59-ac4a-23c776927407","block_type":"box","text":"Generally, BIS supports the vote recommendations of the board of directors and management at","page_number":230,"box":{"x":117,"y":434,"width":721,"height":12}},{"id":"c565d324-978d-49f8-b8ad-fb602bbc40c8","block_type":"box","text":"companies which have sound corporate governance and deliver strong financial returns over time.","page_number":230,"box":{"x":116,"y":450,"width":734,"height":12}},{"id":"1160cc10-e798-47a6-8c7d-8e1924cf24e3","block_type":"box","text":"When we determine it is in our clients’ financial interests to convey concern to companies through","page_number":230,"box":{"x":116,"y":465,"width":729,"height":12}},{"id":"2736afb4-2ba8-4797-a2dc-aae2166dc910","block_type":"box","text":"voting, we may do so in two forms: we might not support the election of directors or other management","page_number":230,"box":{"x":116,"y":481,"width":768,"height":12}},{"id":"8add1fd2-d000-458a-aaa9-17eb0f974f76","block_type":"box","text":"proposals, or we might not support management’s voting recommendation on a shareholder proposal.","page_number":230,"box":{"x":117,"y":496,"width":761,"height":12}},{"id":"16c934c2-0e09-441b-bcc2-f11d0fbcdd31","block_type":"box","text":"Shareholder 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to:","page_number":230,"box":{"x":163,"y":590,"width":468,"height":11}},{"id":"164fea1b-b313-4f41-bc31-58431cf4cf7a","block_type":"box","text":"• Vote to elect, remove, and nominate directors, approve the appointment of the auditor, and","page_number":230,"box":{"x":159,"y":617,"width":705,"height":12}},{"id":"e9f6aa9c-6daa-4804-8bad-0b8b907e723b","block_type":"box","text":"amend the corporate charter or bylaws.","page_number":230,"box":{"x":184,"y":633,"width":297,"height":12}},{"id":"415df30e-eba0-4bc9-a75a-36395dc8a7d2","block_type":"box","text":"• Vote on key board decisions that are material to","page_number":230,"box":{"x":159,"y":655,"width":377,"height":12}},{"id":"d6c7d75a-c7af-4283-b68a-17278d9e61af","block_type":"box","text":"the protection of their investment, including but","page_number":230,"box":{"x":536,"y":655,"width":345,"height":12}},{"id":"4f88398a-8f06-4b35-a043-ec5e8ade44ec","block_type":"box","text":"not limited to, changes to the purpose of the busi","page_number":230,"box":{"x":184,"y":670,"width":353,"height":12}},{"id":"d189e18f-eb61-4655-9d68-9d06ecbbc4a0","block_type":"box","text":"ness, dilution levels, and pre-emptive rights.","page_number":230,"box":{"x":539,"y":670,"width":317,"height":12}},{"id":"a4df6ae7-d064-430c-8d86-e37b74161d92","block_type":"box","text":"• Access sufficient and timely information on governance, strategic, and business matters –","page_number":230,"box":{"x":159,"y":692,"width":691,"height":12}},{"id":"fc1ed077-e99a-487e-80ec-71b777116680","block_type":"box","text":"where such matters are material – to make informed decisions.","page_number":230,"box":{"x":183,"y":707,"width":468,"height":10}},{"id":"dc683c78-95e1-4b09-b0c4-9abf0ff0126c","block_type":"box","text":"Key governance topics","page_number":230,"box":{"x":409,"y":742,"width":182,"height":11}},{"id":"f3a4b98d-4f72-432b-b87e-f782f0e85213","block_type":"box","text":"In our experience, there are certain globally applicable elements of corporate governance that","page_number":230,"box":{"x":117,"y":769,"width":696,"height":12}},{"id":"19c7d9fc-641e-4868-a050-a0fa37ce0a80","block_type":"box","text":"contribute to a company’s ability to create long-term financial value for shareholders. These are topics","page_number":230,"box":{"x":116,"y":785,"width":756,"height":12}},{"id":"c8835729-a9a8-4431-a84f-ae0e4e141f0c","block_type":"box","text":"that shareholders may have the ability to vote on at shareholder meetings. These areas include:","page_number":230,"box":{"x":116,"y":800,"width":711,"height":12}},{"id":"35d875a4-1d93-46ad-9b77-bb4fa6d0f2f1","block_type":"box","text":"• Boards and directors","page_number":230,"box":{"x":117,"y":828,"width":192,"height":10}},{"id":"2f13565a-da20-4cc1-bc5b-5da9f53e9439","block_type":"box","text":"3","page_number":230,"box":{"x":143,"y":853,"width":4,"height":5}},{"id":"a0d3d219-ba0d-4d8a-abc1-6c66cca998e3","block_type":"box","text":"Examples include: Government of Canada, “Canada Business Corporations Act,” amended 2024; European Union,","page_number":230,"box":{"x":171,"y":853,"width":682,"height":10}},{"id":"109372b5-450e-44ea-94a8-fdbb432d5d48","block_type":"box","text":"“Shareholder Rights Directive II,” 2017; and the China Securities Regulatory Commission, “Code of Corporate","page_number":230,"box":{"x":170,"y":866,"width":651,"height":10}},{"id":"df10f1e4-51d4-497a-8ef5-e3918ddd9342","block_type":"box","text":"Governance for Listed Companies in China,” 2001. Websites accessed in December 2025.","page_number":230,"box":{"x":170,"y":879,"width":538,"height":10}},{"id":"e1291b77-d53f-497b-abc4-d5a0001b7a65","block_type":"box","text":"BlackRock Investment Stewardship","page_number":230,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"64161580-ad70-4aec-bf02-56541b6fd2ea","block_type":"box","text":"Global Principles |","page_number":230,"box":{"x":735,"y":909,"width":133,"height":12}},{"id":"22db08b1-0f36-48a4-a6c8-4ff71b95a66b","block_type":"box","text":"4","page_number":230,"box":{"x":874,"y":909,"width":9,"height":9}},{"id":"52ad79c6-e0eb-4aba-b2b0-0944bd5f9ab9","block_type":"box","text":"NM0926U-5926888-230/257","page_number":230,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"23b1be47-7d09-4bac-a9a8-b0d9add15dd3","block_type":"box","text":"• Auditors and audit-related issues","page_number":231,"box":{"x":117,"y":87,"width":282,"height":10}},{"id":"2e6b607e-4bad-4238-8e5e-7742d7a21d65","block_type":"box","text":"• Capital structure, mergers, acquisitions, asset sales, and other special situations","page_number":231,"box":{"x":117,"y":109,"width":635,"height":12}},{"id":"c6d99cdc-3129-40aa-b2bf-ef51cd1092f7","block_type":"box","text":"• Executive compensation","page_number":231,"box":{"x":117,"y":130,"width":219,"height":12}},{"id":"72b90431-a098-47b2-b81b-a6aa2f032c6d","block_type":"box","text":"• Shareholder protections and other significant corporate governance matters","page_number":231,"box":{"x":117,"y":152,"width":600,"height":12}},{"id":"48e2fe37-4c37-4d15-b2da-c35fac418a05","block_type":"box","text":"• Shareholder proposals","page_number":231,"box":{"x":117,"y":173,"width":206,"height":12}},{"id":"9a3b0cb9-b639-4a57-9675-747f68b24681","block_type":"box","text":"The BIS Benchmark Policies are not prescriptive but rather are applied on a pragmatic basis, taking","page_number":231,"box":{"x":116,"y":201,"width":744,"height":12}},{"id":"dfcd95a2-bd98-4627-9e5b-efe54aabff00","block_type":"box","text":"into consideration a number of company-specific factors, including the sector, market, and business","page_number":231,"box":{"x":117,"y":216,"width":744,"height":12}},{"id":"93b3aca0-4115-4fe3-ac04-fb2a274ba40f","block_type":"box","text":"environment within which companies operate.","page_number":231,"box":{"x":116,"y":232,"width":345,"height":12}},{"id":"326800e2-4518-480e-8a0d-a5ff01c59288","block_type":"box","text":"At the regional level, it is our view that companies should observe the accepted corporate governance","page_number":231,"box":{"x":116,"y":259,"width":761,"height":12}},{"id":"b59067bc-93af-4ddb-b413-f5b39a63b37f","block_type":"box","text":"standards in their domestic market at a minimum, and we ask that, if they do not, they explain how","page_number":231,"box":{"x":116,"y":275,"width":736,"height":12}},{"id":"9ac26da6-8370-44f9-b08c-7bc135d9f9dc","block_type":"box","text":"their approach better supports durable, long-term financial value creation. Our regional voting","page_number":231,"box":{"x":116,"y":290,"width":698,"height":12}},{"id":"07625ec1-0a53-4616-9d91-39e9d5d579c4","block_type":"box","text":"guidelines explain how the BIS Global Principles inform our voting decisions in relation to common","page_number":231,"box":{"x":116,"y":306,"width":735,"height":12}},{"id":"92abe8f7-97b9-4bef-84a7-0ecebc882fd7","block_type":"box","text":"ballot items for shareholder meetings in those markets.","page_number":231,"box":{"x":117,"y":321,"width":406,"height":12}},{"id":"356c4f91-358e-4577-907b-e1dd01e92cf5","block_type":"box","text":"4","page_number":231,"box":{"x":525,"y":321,"width":5,"height":6}},{"id":"efdd8016-f8c0-454c-a8b8-be12490e4c77","block_type":"box","text":"Boards and directors","page_number":231,"box":{"x":416,"y":355,"width":173,"height":9}},{"id":"0ba3d2da-bac0-475a-8544-4380c2f480f5","block_type":"box","text":"Oversight role of the board","page_number":231,"box":{"x":117,"y":382,"width":220,"height":13}},{"id":"042acd0d-a002-450e-9bd6-324fe6d1799e","block_type":"box","text":"Companies whose boards are comprised of appropriately qualified, engaged directors with","page_number":231,"box":{"x":117,"y":410,"width":676,"height":12}},{"id":"9f8ed63a-48fb-4905-9cbc-96eeaa8fca26","block_type":"box","text":"professional characteristics relevant to a company’s business enhance the board’s ability to add long","page_number":231,"box":{"x":117,"y":426,"width":753,"height":12}},{"id":"002a703b-6690-4136-a6d5-834daa20ac6d","block_type":"box","text":"term financial value and serve as the voice of shareholders in board discussions. In our view, a strong","page_number":231,"box":{"x":116,"y":441,"width":761,"height":12}},{"id":"4b3fcb34-7a1e-449b-a0e3-355488fda63c","block_type":"box","text":"board gives a company a competitive advantage, providing valuable oversight and contributing to the","page_number":231,"box":{"x":117,"y":457,"width":754,"height":12}},{"id":"fc5b16bb-b3e7-4ba3-9042-6d498d12b772","block_type":"box","text":"most important management decisions that support long-term financial performance.","page_number":231,"box":{"x":117,"y":472,"width":632,"height":12}},{"id":"fd199d25-5fc8-49b6-bb0d-1fff4a8ff39b","block_type":"box","text":"For this reason, our investment stewardship efforts focus on the effectiveness of the board of directors.","page_number":231,"box":{"x":117,"y":500,"width":768,"height":12}},{"id":"5bc6133f-084e-4a1e-a665-d20fb6e5247c","block_type":"box","text":"We engage, as necessary, with members of the board’s nominating and/or governance committee to","page_number":231,"box":{"x":116,"y":515,"width":753,"height":12}},{"id":"3baf4e3c-fe68-4f45-923f-4cd675bb8c09","block_type":"box","text":"assess whether governance practices and board composition are effective given a company’s","page_number":231,"box":{"x":116,"y":531,"width":701,"height":12}},{"id":"383255d2-0a0e-44f1-a1f8-cb67062b0e06","block_type":"box","text":"business model, sector, market, and the business environment in which a company is operating.","page_number":231,"box":{"x":117,"y":546,"width":719,"height":12}},{"id":"e07b4794-78c5-4f79-8ae1-35739df73a29","block_type":"box","text":"We consider it good practice when the board establishes and maintains a framework of robust and","page_number":231,"box":{"x":116,"y":574,"width":736,"height":12}},{"id":"2cf19a88-1334-44c8-970b-d4bfbcea6c5f","block_type":"box","text":"effective governance mechanisms that supports its oversight of the company’s strategy and","page_number":231,"box":{"x":116,"y":589,"width":685,"height":12}},{"id":"f710d49e-8485-4234-b9f2-6e69384cf11f","block_type":"box","text":"operations, consistent with the long-term financial interests of investors. This includes having clear","page_number":231,"box":{"x":116,"y":605,"width":735,"height":12}},{"id":"47e42795-4739-4e41-a271-fd0e22f65183","block_type":"box","text":"descriptions of the role of the board and the committees of the board and how directors engage with","page_number":231,"box":{"x":116,"y":620,"width":748,"height":12}},{"id":"c42e9677-1a06-4547-93e1-aa5f5f0cc923","block_type":"box","text":"and oversee management, as well as disclosure of material risks that may affect a company’s long","page_number":231,"box":{"x":116,"y":636,"width":738,"height":12}},{"id":"710e913c-0aa4-41f5-8e95-6330614c7865","block_type":"box","text":"term strategy and how management is effectively identifying, managing, and mitigating such risks.","page_number":231,"box":{"x":116,"y":651,"width":732,"height":12}},{"id":"eab146fc-43a5-4107-aebd-6d0531486ba0","block_type":"box","text":"Understanding management’s long-term strategy and the milestones against which investors should","page_number":231,"box":{"x":117,"y":679,"width":741,"height":12}},{"id":"c1569a1c-acb1-4355-816b-e631fce9302d","block_type":"box","text":"assess its implementation is central to our approach. If any strategic targets are significantly missed or","page_number":231,"box":{"x":116,"y":694,"width":761,"height":12}},{"id":"336a2d30-f3ae-4694-8404-811068011a6e","block_type":"box","text":"materially restated, we find it helpful when company disclosures provide a detailed explanation of the","page_number":231,"box":{"x":117,"y":710,"width":747,"height":12}},{"id":"ba454d6a-547d-48fb-ab73-31cf07e8eed5","block_type":"box","text":"changes and an indication of the board’s role in reviewing the revised targets. We look to the board to","page_number":231,"box":{"x":116,"y":725,"width":754,"height":12}},{"id":"547271e5-c996-49b3-aea9-608945cbc335","block_type":"box","text":"articulate the effectiveness of these mechanisms in overseeing the management of business risks and","page_number":231,"box":{"x":116,"y":741,"width":759,"height":12}},{"id":"0acf0577-8d32-4104-bc80-00abb7e9e9fd","block_type":"box","text":"opportunities and the fulfillment of the company’s strategy.","page_number":231,"box":{"x":116,"y":756,"width":432,"height":12}},{"id":"03004d0f-52d6-4984-a6ce-a5a50100b7c2","block_type":"box","text":"Where a company has not adequately disclosed or demonstrated that its board has fulfilled these","page_number":231,"box":{"x":116,"y":784,"width":722,"height":12}},{"id":"ca116b0d-2b25-481e-b863-590e85b58ab0","block_type":"box","text":"corporate governance and risk oversight responsibilities, we may consider not supporting the election","page_number":231,"box":{"x":116,"y":800,"width":752,"height":12}},{"id":"2287dc62-c3a4-4ecf-b7bd-aeee0bdabe32","block_type":"box","text":"of directors who, in our assessment, have particular responsibility for the issues.","page_number":231,"box":{"x":116,"y":815,"width":594,"height":12}},{"id":"d724d3a1-466f-414c-874c-c612c5246ba6","block_type":"box","text":"4","page_number":231,"box":{"x":143,"y":840,"width":4,"height":5}},{"id":"2dd14f83-a03b-422c-aec3-4d20f18a422a","block_type":"box","text":"Our regional voting guidelines reflect these different market standards and norms. Depending on the market, generally","page_number":231,"box":{"x":170,"y":840,"width":702,"height":10}},{"id":"7e3b007c-c6d1-4cde-ac81-06e4505b139f","block_type":"box","text":"accepted practice is informed by corporate law, market regulation, best practices, and industry initiatives, amongst other","page_number":231,"box":{"x":170,"y":853,"width":712,"height":10}},{"id":"4533e750-7cea-4b96-ba6e-a6ecdca80650","block_type":"box","text":"factors. BIS carries out engagement with companies, executes proxy votes, and conducts vote operations (including","page_number":231,"box":{"x":170,"y":866,"width":688,"height":10}},{"id":"0cc46d95-3f61-4865-8071-4f32b3fc6d35","block_type":"box","text":"maintaining records of votes cast) in a manner consistent with the relevant regional voting guidelines.","page_number":231,"box":{"x":170,"y":879,"width":600,"height":10}},{"id":"f6b917f5-4350-4184-97dc-9fed33867643","block_type":"box","text":"BlackRock Investment Stewardship","page_number":231,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"4f0ac95f-e1f7-4a5c-85c6-92549fc654a2","block_type":"box","text":"Global Principles |","page_number":231,"box":{"x":735,"y":909,"width":133,"height":12}},{"id":"18f3ff42-1d0f-4c65-b115-f62c8c5bf231","block_type":"box","text":"5","page_number":231,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"4597d997-d72c-490e-a299-d6ef89dc9740","block_type":"box","text":"NM0926U-5926888-231/257","page_number":231,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"a7724c68-6c24-4f68-ac99-58c579bd1893","block_type":"box","text":"When casting vote decisions on behalf of clients on the election of directors, some of the factors that","page_number":232,"box":{"x":116,"y":87,"width":750,"height":12}},{"id":"4c87cca3-5c13-4282-81ae-8b939772d85c","block_type":"box","text":"speak to the board’s effectiveness as a group include the relevance of individual directors’","page_number":232,"box":{"x":116,"y":102,"width":673,"height":13}},{"id":"8c2435db-42ae-4cdf-a85a-abf3a41244b5","block_type":"box","text":"qualifications and skillsets, as well as directors’ capacity and other time commitments, and how these","page_number":232,"box":{"x":116,"y":118,"width":757,"height":12}},{"id":"ed45ec83-1694-4569-88e0-f08dadf33de9","block_type":"box","text":"factors may contribute to the company’s financial performance. We look to boards to establish formal","page_number":232,"box":{"x":116,"y":134,"width":754,"height":12}},{"id":"ad467ff7-2dd5-468b-96e0-d0804eca84a2","block_type":"box","text":"and transparent processes for nominating directors that reflect the company’s long-term strategy and","page_number":232,"box":{"x":116,"y":149,"width":754,"height":12}},{"id":"b0f4e8b4-24e1-4903-bf22-718af7c971aa","block_type":"box","text":"business model.","page_number":232,"box":{"x":117,"y":165,"width":125,"height":9}},{"id":"0f7bdffc-a08e-4ad9-95e2-125dafd51c12","block_type":"box","text":"In the section titled “Board quality and effectiveness” below, we provide more detail about our","page_number":232,"box":{"x":117,"y":193,"width":697,"height":12}},{"id":"1d02ef69-0088-4167-bdce-74d0cb83332b","block_type":"box","text":"approach to board composition and how it underpins board effectiveness and long-term financial value","page_number":232,"box":{"x":116,"y":209,"width":766,"height":12}},{"id":"4fbd107b-5b88-40d4-ad57-b07e2c83478e","block_type":"box","text":"creation.","page_number":232,"box":{"x":116,"y":224,"width":69,"height":10}},{"id":"9909b9bb-9207-4c58-a731-d27295579156","block_type":"box","text":"Regular accountability through director elections","page_number":232,"box":{"x":116,"y":253,"width":398,"height":12}},{"id":"3a9501b8-5b91-49f9-a8aa-3b7b2271f2b5","block_type":"box","text":"The election of directors to the board is a right of shareholders and an important signal of support for,","page_number":232,"box":{"x":116,"y":281,"width":756,"height":12}},{"id":"554ad652-d023-4d7e-a214-3c5802cf6d41","block_type":"box","text":"or concern about, the performance of the board in overseeing and advising management. To ensure","page_number":232,"box":{"x":116,"y":297,"width":749,"height":12}},{"id":"aff60403-cbc7-490b-adc1-262964feff52","block_type":"box","text":"accountability for their decisions on behalf of shareholders, directors should stand for election on a","page_number":232,"box":{"x":116,"y":312,"width":736,"height":12}},{"id":"7428ecad-3d98-4767-9c60-8e74ed8726b8","block_type":"box","text":"regular basis, ideally annually.","page_number":232,"box":{"x":117,"y":328,"width":223,"height":12}},{"id":"babcfdfe-14bd-49b1-94f9-8b0af74f8d86","block_type":"box","text":"5","page_number":232,"box":{"x":341,"y":328,"width":6,"height":6}},{"id":"e4082e04-52a9-429e-8bf2-e1b86646d12c","block_type":"box","text":"Annual director elections allow shareholders to reaffirm their support","page_number":232,"box":{"x":347,"y":328,"width":517,"height":12}},{"id":"caf701c4-8abe-4e75-9181-4a6eece68340","block_type":"box","text":"for, or concerns about, board members’ decisions in a timely manner. When board members are not","page_number":232,"box":{"x":116,"y":343,"width":749,"height":12}},{"id":"739d4904-33fe-4d9c-a554-365c3fffba67","block_type":"box","text":"elected annually, we consider it good practice for boards to have a rotation policy to ensure that,","page_number":232,"box":{"x":116,"y":359,"width":719,"height":12}},{"id":"0e4af4c7-1c9f-4c55-91d7-486d2fc0e7ff","block_type":"box","text":"through a board cycle, all directors have had their appointment re-confirmed, with a proportion of","page_number":232,"box":{"x":116,"y":374,"width":722,"height":12}},{"id":"15e831d3-6ca7-425e-a06f-c8bb2a84628c","block_type":"box","text":"directors being put forward for election at each shareholder meeting.","page_number":232,"box":{"x":116,"y":390,"width":513,"height":12}},{"id":"c2e6f74d-3c82-4509-ba7d-fe056e2b8b7c","block_type":"box","text":"Board quality and effectiveness","page_number":232,"box":{"x":116,"y":418,"width":258,"height":12}},{"id":"0eb77dfc-192a-477b-aab8-51ed2558e009","block_type":"box","text":"Regular director elections also give boards the opportunity to adjust their composition in an orderly way","page_number":232,"box":{"x":117,"y":447,"width":770,"height":12}},{"id":"e004a777-0a50-4519-b940-aa8b23e1373c","block_type":"box","text":"to reflect developments in the company’s strategy and the market environment. In our view, it is","page_number":232,"box":{"x":116,"y":462,"width":714,"height":12}},{"id":"1ee323c0-f478-4431-90c4-ed6e2492ac8b","block_type":"box","text":"beneficial for new directors to be brought onto the board periodically to refresh the group’s thinking,","page_number":232,"box":{"x":117,"y":478,"width":741,"height":12}},{"id":"9224c21e-22ec-4f9c-a279-571a999c0afd","block_type":"box","text":"while supporting both continuity and appropriate succession planning. We consider the average overall","page_number":232,"box":{"x":116,"y":493,"width":768,"height":12}},{"id":"0d8ff289-b25c-4b55-89bb-039326b9276a","block_type":"box","text":"tenure of the board and seek a balance between the knowledge and experience of longer-serving","page_number":232,"box":{"x":116,"y":509,"width":728,"height":12}},{"id":"b8827aec-b9d6-41c3-a408-42a1f337a54c","block_type":"box","text":"directors and the fresh perspectives of directors who joined more recently.","page_number":232,"box":{"x":116,"y":524,"width":556,"height":12}},{"id":"a9fa20cc-aa4b-4bb2-a841-bddbed1bcca5","block_type":"box","text":"We appreciate when companies regularly review and assess how directors nominated for election","page_number":232,"box":{"x":116,"y":553,"width":731,"height":12}},{"id":"898a3ee0-1347-4339-8467-c06952ef69f4","block_type":"box","text":"contribute to the effectiveness of the board. In our view, the company’s assessment should consider a","page_number":232,"box":{"x":116,"y":568,"width":763,"height":12}},{"id":"04df78f3-6dce-4f65-9480-2a2caa3b927d","block_type":"box","text":"number of factors, including each director’s independence and time commitments, as well as the","page_number":232,"box":{"x":117,"y":584,"width":720,"height":12}},{"id":"67a39c40-c866-42e5-a5e5-9b5182c73cf3","block_type":"box","text":"breadth and relevance of director experiences and skillsets, and how these collectively contribute to","page_number":232,"box":{"x":117,"y":599,"width":744,"height":13}},{"id":"77e28329-520d-4401-a393-cbc65ed680a4","block_type":"box","text":"the board’s effectiveness in advising and overseeing management in delivering long-term financial","page_number":232,"box":{"x":116,"y":615,"width":734,"height":12}},{"id":"2b38156f-6956-4088-a399-a3093470b072","block_type":"box","text":"returns.","page_number":232,"box":{"x":117,"y":631,"width":60,"height":9}},{"id":"e6e21a19-530b-4202-8164-c828d53afe14","block_type":"box","text":"Director independence","page_number":232,"box":{"x":116,"y":659,"width":187,"height":12}},{"id":"2e62980a-f210-40fc-96be-31d3ec1e4600","block_type":"box","text":"Director independence – from management, significant shareholders, or other related parties – is a","page_number":232,"box":{"x":117,"y":688,"width":733,"height":12}},{"id":"0a2b10d1-62b0-445e-a838-b5d5fbfe8707","block_type":"box","text":"central tenet of sound corporate governance across markets.","page_number":232,"box":{"x":116,"y":703,"width":452,"height":12}},{"id":"3d2b6f48-621d-4859-b56d-c6bece754a94","block_type":"box","text":"6","page_number":232,"box":{"x":570,"y":703,"width":5,"height":6}},{"id":"8bdab060-59ac-4af9-855d-14655e2c6615","block_type":"box","text":"We look to boards to have a sufficient","page_number":232,"box":{"x":581,"y":703,"width":280,"height":10}},{"id":"411e7a03-4b78-4bf7-81ba-4465701187a7","block_type":"box","text":"number of independent directors, free from conflicts of interest or undue influence, to ensure objectivity","page_number":232,"box":{"x":117,"y":719,"width":763,"height":12}},{"id":"67a29f4e-6fb7-4e47-8b39-3a59d173f826","block_type":"box","text":"in the decision-making of the board and its ability to oversee management. We generally consider it","page_number":232,"box":{"x":117,"y":734,"width":738,"height":12}},{"id":"ab46d2db-a922-4698-9a6a-cefd7f37f689","block_type":"box","text":"good practice for independent directors to make a majority of the board, or in the case of controlled","page_number":232,"box":{"x":116,"y":750,"width":734,"height":12}},{"id":"cec91606-ebc0-48bd-8a1d-892047b124e8","block_type":"box","text":"companies, at least one-third.","page_number":232,"box":{"x":116,"y":765,"width":219,"height":12}},{"id":"abcfd369-a53d-4399-abf6-efc15ccfb3bd","block_type":"box","text":"Common impediments to independence may include but are not limited to:","page_number":232,"box":{"x":117,"y":794,"width":551,"height":12}},{"id":"abb8b252-2b4e-4afa-9d09-80a48374b6c8","block_type":"box","text":"• Current or recent employment at the company or a subsidiary","page_number":232,"box":{"x":117,"y":816,"width":490,"height":12}},{"id":"22e4621c-78b5-4f5a-b749-4cbc79787a56","block_type":"box","text":"5","page_number":232,"box":{"x":143,"y":841,"width":4,"height":5}},{"id":"bfda1a5c-549d-4299-9100-995a0a64ca44","block_type":"box","text":"In most markets, directors stand for re-election on an annual or triennial basis, as determined by corporate law, market","page_number":232,"box":{"x":171,"y":841,"width":703,"height":9}},{"id":"f2ba0495-d757-4e51-9708-5d83c478b4ff","block_type":"box","text":"regulation or voluntary best practice.","page_number":232,"box":{"x":170,"y":854,"width":215,"height":9}},{"id":"f77adff1-2517-482c-9c98-9277ff1c80ba","block_type":"box","text":"6","page_number":232,"box":{"x":143,"y":867,"width":4,"height":5}},{"id":"725138f7-c4b2-474e-a39e-01f87f909cf6","block_type":"box","text":"For example, please see: Tokyo Stock Exchange, “Japan’s Corporate Governance Code,” June 11, 2021; Financial","page_number":232,"box":{"x":171,"y":867,"width":683,"height":9}},{"id":"77a82904-c84e-4cba-acc8-12194878bddb","block_type":"box","text":"Reporting Council, “UK Corporate Governance Code,” January 2024, accessed in December 2025.","page_number":232,"box":{"x":171,"y":880,"width":587,"height":9}},{"id":"40db5061-0a6a-4939-8fa6-0849d8226b38","block_type":"box","text":"BlackRock Investment Stewardship","page_number":232,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"3ea6fbaf-36dd-4234-8aa2-b83531fe44e7","block_type":"box","text":"Global Principles |","page_number":232,"box":{"x":735,"y":909,"width":133,"height":12}},{"id":"bace2fea-38f6-4633-b4e9-c853a07295f7","block_type":"box","text":"6","page_number":232,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"e84b790a-2510-41f9-8c5c-c48a0446085d","block_type":"box","text":"NM0926U-5926888-232/257","page_number":232,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"8c3a6853-690f-4946-9d3d-b85647ffd096","block_type":"box","text":"• Being, or representing, a shareholder with a substantial shareholding in the company","page_number":233,"box":{"x":117,"y":87,"width":668,"height":12}},{"id":"bad171c6-002f-4bd8-8ad0-e3851ebdac29","block_type":"box","text":"• Interlocking directorates","page_number":233,"box":{"x":117,"y":110,"width":216,"height":12}},{"id":"7d13880e-8567-4c25-a770-96b1b0da94e0","block_type":"box","text":"• Having any other interest, business, or other relationship which could, or could reasonably be","page_number":233,"box":{"x":117,"y":134,"width":730,"height":12}},{"id":"8cc990a7-8ea5-4f59-8a5f-87805976d6c0","block_type":"box","text":"perceived to, materially interfere with a director’s ability to act in the best interests of the company","page_number":233,"box":{"x":150,"y":149,"width":729,"height":12}},{"id":"fc39bc8e-1697-4e38-87ac-424f5bcf7c15","block_type":"box","text":"and shareholders","page_number":233,"box":{"x":150,"y":165,"width":134,"height":9}},{"id":"62a4d3b3-2378-4820-b094-fcbe44890eba","block_type":"box","text":"In our experience, boards are most effective at overseeing and advising management when there is a","page_number":233,"box":{"x":117,"y":196,"width":759,"height":12}},{"id":"b0f56433-0cf1-43d4-a517-0d6f197af72d","block_type":"box","text":"senior, independent board leader. This director may chair the board, or, where the chair is also the","page_number":233,"box":{"x":116,"y":211,"width":736,"height":12}},{"id":"8b722711-792c-435b-a461-1a0a550a2622","block_type":"box","text":"CEO (or is otherwise not independent), be designated as a lead independent director. The role of this","page_number":233,"box":{"x":117,"y":227,"width":757,"height":12}},{"id":"a7bd6c1f-3bbf-4d86-8062-138c6fcf36d6","block_type":"box","text":"director is to support independent board members in fulfilling their oversight responsibilities effectively","page_number":233,"box":{"x":116,"y":242,"width":760,"height":12}},{"id":"12fced98-5b23-4453-9af8-768c4deeff8a","block_type":"box","text":"by shaping the agenda, ensuring adequate information is provided to the board, and encouraging","page_number":233,"box":{"x":117,"y":258,"width":726,"height":12}},{"id":"659553f0-3107-4e96-8adc-3c8c3d279cbf","block_type":"box","text":"independent director participation in board deliberations. We appreciate when the lead independent","page_number":233,"box":{"x":117,"y":273,"width":742,"height":12}},{"id":"922139a1-a749-4df9-bc4a-7e52b311a17e","block_type":"box","text":"director or another appropriate director is available to meet with shareholders to explain and","page_number":233,"box":{"x":116,"y":289,"width":687,"height":12}},{"id":"206f68f2-e38e-4eb5-ac7e-6ee75251fbf9","block_type":"box","text":"contextualize a company’s approach as a situation warrants.","page_number":233,"box":{"x":116,"y":304,"width":454,"height":12}},{"id":"2d75598f-2da5-458e-9408-79df5334f48b","block_type":"box","text":"Boards may face matters that could involve conflicts of interest for executives or affiliated directors, or","page_number":233,"box":{"x":117,"y":335,"width":759,"height":12}},{"id":"7b3f4226-52b7-48ae-ad1c-651b00514d21","block_type":"box","text":"that require additional focus. It is our view that objective oversight of such matters is best achieved","page_number":233,"box":{"x":116,"y":351,"width":736,"height":12}},{"id":"b64e189c-fa3d-408e-b740-19b974a96e77","block_type":"box","text":"when the board forms committees with a majority of independent directors, depending on market","page_number":233,"box":{"x":116,"y":366,"width":723,"height":12}},{"id":"ac256972-27fc-48d1-af72-7d6a6edf7bab","block_type":"box","text":"norms and a company’s ownership structure. In many markets, these committees of the board","page_number":233,"box":{"x":117,"y":382,"width":704,"height":12}},{"id":"e8731c29-b930-4a61-952d-4c794d2aad79","block_type":"box","text":"specialize in audit, director nominations, and compensation matters, among others. An ad hoc","page_number":233,"box":{"x":116,"y":397,"width":703,"height":12}},{"id":"9adf942c-e12c-4ef2-91d3-5705bf0cf0fb","block_type":"box","text":"committee might also be formed to decide on a special transaction, particularly one involving a related","page_number":233,"box":{"x":116,"y":413,"width":762,"height":12}},{"id":"dd122f30-8f3a-4292-b571-cdd2e3487e4e","block_type":"box","text":"party, or to investigate a significant adverse event.","page_number":233,"box":{"x":117,"y":428,"width":378,"height":12}},{"id":"85522196-d812-4ac2-8eda-c57c0f70aa39","block_type":"box","text":"Sufficient capacity","page_number":233,"box":{"x":117,"y":459,"width":152,"height":12}},{"id":"e05e1700-6664-4016-8a39-fa8e5e3d7e38","block_type":"box","text":"As the role and expectations of a director are increasingly demanding, directors must be able to","page_number":233,"box":{"x":116,"y":490,"width":715,"height":12}},{"id":"d96a6a44-dc92-46f3-9a93-097dfb79d944","block_type":"box","text":"commit an appropriate amount of time to board and committee matters. It is important that directors","page_number":233,"box":{"x":116,"y":506,"width":743,"height":12}},{"id":"841a3594-4d3d-4cb5-a968-ad9039690943","block_type":"box","text":"have the capacity to meet all of their responsibilities – including when there are unforeseen events –","page_number":233,"box":{"x":117,"y":521,"width":747,"height":12}},{"id":"99571eaf-74ee-4b81-9804-2d7576aa22a2","block_type":"box","text":"and therefore, we consider it best practice when they don’t take on an excessive number of roles that","page_number":233,"box":{"x":116,"y":537,"width":756,"height":12}},{"id":"b4e61d2c-7e0d-4dbd-98dd-817488c183a5","block_type":"box","text":"would impair their ability to fulfill their duties.","page_number":233,"box":{"x":116,"y":552,"width":333,"height":12}},{"id":"efb9ef92-4354-4eb7-8b9d-df2fb592395b","block_type":"box","text":"Board composition","page_number":233,"box":{"x":116,"y":583,"width":158,"height":12}},{"id":"feeab885-9e72-45f0-aadc-247cf76c577f","block_type":"box","text":"In assessing board composition, we take into account a company’s board size, business model,","page_number":233,"box":{"x":117,"y":614,"width":714,"height":12}},{"id":"8fa7f923-50f7-42f9-9d73-8718a31ab656","block_type":"box","text":"strategy, market capitalization, and ownership structure, as well as the market in which the company","page_number":233,"box":{"x":116,"y":630,"width":750,"height":12}},{"id":"d5e56998-13c9-4553-9f2c-42ff2163496a","block_type":"box","text":"operates. We find it helpful when companies explain how their approach to board composition supports","page_number":233,"box":{"x":116,"y":645,"width":771,"height":12}},{"id":"d11aa069-fad1-4a95-b91b-f1b419f85068","block_type":"box","text":"the company’s governance practices.","page_number":233,"box":{"x":116,"y":661,"width":276,"height":12}},{"id":"88989cf3-b1e2-47ee-b990-7c123c6f4977","block_type":"box","text":"When nominating directors to the board, we look to companies to provide sufficient information on the","page_number":233,"box":{"x":116,"y":692,"width":754,"height":12}},{"id":"2e53a950-57dd-4e79-a06d-404f96d70c61","block_type":"box","text":"individual candidates so that shareholders can assess the capabilities and suitability of each individual","page_number":233,"box":{"x":117,"y":707,"width":757,"height":12}},{"id":"f8c9d9e2-1653-403d-93e9-7f68eca54418","block_type":"box","text":"nominee and their fit within overall board composition. These disclosures should explain how the","page_number":233,"box":{"x":117,"y":723,"width":715,"height":12}},{"id":"fe958067-2caf-4641-aca6-a260d1881ae5","block_type":"box","text":"collective experience and expertise of the board, as well as the particular skillsets of individual","page_number":233,"box":{"x":116,"y":738,"width":697,"height":12}},{"id":"914e8b09-71a6-4895-b858-b0176a93153c","block_type":"box","text":"directors, aligns with the company’s long-term strategy. Highly qualified, engaged directors with","page_number":233,"box":{"x":116,"y":754,"width":707,"height":12}},{"id":"c4126a1a-c805-402a-8891-3d7a1ccda6e5","block_type":"box","text":"professional characteristics relevant to a company’s business and strategy enhance the ability of the","page_number":233,"box":{"x":117,"y":769,"width":744,"height":12}},{"id":"100332ca-f552-4507-98ff-7c54191c8d30","block_type":"box","text":"board to add value and be the voice of shareholders in board discussions.","page_number":233,"box":{"x":117,"y":785,"width":547,"height":9}},{"id":"ffe1e843-d254-4caf-ba75-f6d36241d0e7","block_type":"box","text":"It is in this context that we are interested in a variety of experiences, perspectives, and skillsets in the","page_number":233,"box":{"x":117,"y":816,"width":750,"height":12}},{"id":"37c20b00-fb2f-49d9-a0c8-db762f35dfca","block_type":"box","text":"board room. We see it as a means of avoiding “group think” in the board’s exercise of its","page_number":233,"box":{"x":117,"y":831,"width":659,"height":12}},{"id":"dd734dd3-7eee-4536-87b7-01f391e4eda0","block_type":"box","text":"responsibilities to advise and oversee management. We note that in many markets, policymakers have","page_number":233,"box":{"x":117,"y":847,"width":768,"height":12}},{"id":"416c5213-ce93-4717-89f1-176828153a3f","block_type":"box","text":"set board gender diversity goals which we may discuss with companies, particularly if there is a risk","page_number":233,"box":{"x":116,"y":862,"width":743,"height":12}},{"id":"2d634f41-a7f0-4191-b4c3-cc36f0ff4605","block_type":"box","text":"their board composition may be misaligned.","page_number":233,"box":{"x":116,"y":878,"width":329,"height":12}},{"id":"ef4842ef-b18c-4673-823a-18e539e850bc","block_type":"box","text":"BlackRock Investment Stewardship","page_number":233,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"eae9d58f-1131-444d-8281-1e3e1e29049f","block_type":"box","text":"Global Principles |","page_number":233,"box":{"x":735,"y":909,"width":133,"height":12}},{"id":"d2bdb9f6-ef4f-4c6f-8a76-14c99370569a","block_type":"box","text":"7","page_number":233,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"9b6399fc-b02c-492d-896f-9676583edbad","block_type":"box","text":"NM0926U-5926888-233/257","page_number":233,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"91ff94c7-5f70-41ca-993d-472da425d569","block_type":"box","text":"Auditors and audit-related issues","page_number":234,"box":{"x":366,"y":87,"width":272,"height":10}},{"id":"86436af9-aa3b-48b2-8372-3728a215f7ea","block_type":"box","text":"BIS recognizes the critical importance of financial statements to provide a complete and accurate","page_number":234,"box":{"x":117,"y":117,"width":725,"height":12}},{"id":"ac196598-1186-4683-b7cd-97605169520c","block_type":"box","text":"portrayal of a company’s financial condition. Accordingly, we look for the assumptions made by","page_number":234,"box":{"x":117,"y":133,"width":709,"height":12}},{"id":"f6bef362-e51e-43e1-8a15-0947c5561055","block_type":"box","text":"management, and reviewed by the auditor in preparing the financial statements, to be reasonable and","page_number":234,"box":{"x":117,"y":148,"width":760,"height":12}},{"id":"72aa63e0-2ccc-4487-b288-d0e3a4484a38","block_type":"box","text":"justified.","page_number":234,"box":{"x":115,"y":164,"width":67,"height":12}},{"id":"f5dc3b04-9b2a-4456-9559-3b976a5178c8","block_type":"box","text":"We view the audit committee, or its equivalent, as responsible for overseeing the management of the","page_number":234,"box":{"x":116,"y":194,"width":754,"height":12}},{"id":"f389fab4-bb44-4e63-82aa-d3134aafdf09","block_type":"box","text":"independent auditor and the internal audit function at a company. The committee plays an important","page_number":234,"box":{"x":117,"y":210,"width":746,"height":12}},{"id":"4518b3be-e73d-408c-8bfe-49e54b369659","block_type":"box","text":"role in a company’s financial reporting system by providing independent oversight of the accounts,","page_number":234,"box":{"x":117,"y":225,"width":733,"height":12}},{"id":"88b915d1-b3dd-41fd-94ea-2f9366a2a80e","block_type":"box","text":"material financial, and, where appropriate to the jurisdiction, non-financial information and internal","page_number":234,"box":{"x":117,"y":241,"width":728,"height":12}},{"id":"15bc937f-5680-418a-8eb8-8bad95fa3a26","block_type":"box","text":"control frameworks. Moreover, in the absence of a dedicated risk committee, these committees can","page_number":234,"box":{"x":116,"y":256,"width":743,"height":11}},{"id":"96aeaf9a-cb27-45de-8a20-390ad2df797c","block_type":"box","text":"provide oversight of Enterprise Risk Management systems.","page_number":234,"box":{"x":117,"y":272,"width":437,"height":12}},{"id":"b78e0226-2f7c-447d-872b-201ab7db5750","block_type":"box","text":"7","page_number":234,"box":{"x":556,"y":272,"width":5,"height":6}},{"id":"91368a96-1e3f-466f-8ff7-cedc80cd5067","block_type":"box","text":"In our view, effective audit committee","page_number":234,"box":{"x":562,"y":272,"width":286,"height":11}},{"id":"683b11f2-ba65-4b28-b8d3-e3496f965c7f","block_type":"box","text":"oversight strengthens the quality and reliability of a company’s financial statements and provides an","page_number":234,"box":{"x":116,"y":287,"width":745,"height":12}},{"id":"cd69c182-63bf-4758-a53c-578aa1a2e8cd","block_type":"box","text":"important level of reassurance to shareholders.","page_number":234,"box":{"x":117,"y":303,"width":354,"height":12}},{"id":"ff207315-c465-4565-8018-0b3099677e04","block_type":"box","text":"We look to audit committees, or their equivalent, to have clearly articulated charters that set out their","page_number":234,"box":{"x":116,"y":333,"width":750,"height":12}},{"id":"bc9f5dd3-a3c4-4522-8328-03ac4d086c5e","block_type":"box","text":"responsibilities. Additionally, having a rotation plan can periodically refresh the committee membership","page_number":234,"box":{"x":117,"y":349,"width":765,"height":12}},{"id":"45228f09-05d8-446a-a9a7-d858394fc160","block_type":"box","text":"and introduce new perspectives. We recognize that audit committees will rely on management, internal","page_number":234,"box":{"x":116,"y":364,"width":769,"height":12}},{"id":"40d62a72-90c2-476e-9dda-5da9fb373b3f","block_type":"box","text":"audit, and the independent auditor to fulfill their responsibilities. However, we look to committee","page_number":234,"box":{"x":116,"y":380,"width":712,"height":12}},{"id":"a3e4e600-97cf-4593-a111-7af118998405","block_type":"box","text":"members to demonstrate they have relevant expertise to monitor and oversee the audit process and","page_number":234,"box":{"x":117,"y":395,"width":749,"height":12}},{"id":"db83366b-b39b-495c-a72a-b987cdba40e4","block_type":"box","text":"related activities.","page_number":234,"box":{"x":117,"y":411,"width":129,"height":9}},{"id":"8e725f97-b3ec-4be7-95fd-7998646619b7","block_type":"box","text":"We take particular note of unexplained changes in reporting methodology, cases involving significant","page_number":234,"box":{"x":116,"y":441,"width":753,"height":12}},{"id":"2e279781-1ef0-4f2e-aab9-0d62f13b9c4f","block_type":"box","text":"financial restatements, or ad hoc notifications of material financial weakness. In this respect, we look to","page_number":234,"box":{"x":116,"y":457,"width":770,"height":11}},{"id":"e7840101-d2cb-4e87-a1a7-274057f2ed85","block_type":"box","text":"audit committees to provide timely disclosure on the remediation of key and critical audit matters","page_number":234,"box":{"x":116,"y":472,"width":720,"height":12}},{"id":"b9cc6d79-d203-48ec-a7f0-1986c86587fd","block_type":"box","text":"identified either by the external auditor or internal audit function.","page_number":234,"box":{"x":117,"y":488,"width":478,"height":12}},{"id":"68e2d616-c1f9-4849-aa59-5c560178a671","block_type":"box","text":"The integrity of financial statements depends on the auditor being free of any impediments that could","page_number":234,"box":{"x":116,"y":518,"width":754,"height":12}},{"id":"9bf1e105-70a1-4b0c-b34f-10bef7aeb817","block_type":"box","text":"compromise its ability to serve as an effective check on management. To that end, it is important that","page_number":234,"box":{"x":116,"y":533,"width":755,"height":12}},{"id":"8ec182fa-c0d5-4027-97c8-c449a3a54d73","block_type":"box","text":"auditors are, and are seen to be, independent. Where an audit firm provides services to the company","page_number":234,"box":{"x":116,"y":549,"width":756,"height":12}},{"id":"bed14596-79bc-4005-b50a-f942548aa422","block_type":"box","text":"in addition to the audit, we look for the fees","page_number":234,"box":{"x":117,"y":564,"width":323,"height":12}},{"id":"83465795-0fb7-467b-8b9e-3fe1ab1f1b20","block_type":"box","text":"earned to be disclosed and explained. We look for audit","page_number":234,"box":{"x":441,"y":564,"width":419,"height":12}},{"id":"75fec6f5-6c90-4b09-82db-a664defdb225","block_type":"box","text":"committees to have in place a procedure for assessing the independence of the auditor and the quality","page_number":234,"box":{"x":116,"y":580,"width":767,"height":12}},{"id":"7cf4a259-416b-4a15-a286-893cd3f5fb04","block_type":"box","text":"of the external audit process on an annual basis.","page_number":234,"box":{"x":116,"y":595,"width":366,"height":12}},{"id":"11331503-ffda-4dff-afe6-f778a12f773d","block_type":"box","text":"Comprehensive disclosure provides investors with an understanding of the company’s long-term","page_number":234,"box":{"x":117,"y":626,"width":719,"height":12}},{"id":"1c2be05a-35fc-446f-823c-bd7f15702364","block_type":"box","text":"operational risk management practices and, more broadly, the quality of the board’s oversight. We look","page_number":234,"box":{"x":116,"y":641,"width":770,"height":12}},{"id":"a3e3f237-f5e9-4e09-8071-5510d4952ca5","block_type":"box","text":"to the audit or risk committee to periodically review the company’s risk assessment and risk","page_number":234,"box":{"x":116,"y":657,"width":684,"height":12}},{"id":"93726ac8-6063-42a7-8677-6a163cdda8e7","block_type":"box","text":"management policies and the significant risks and exposures identified by management, the internal","page_number":234,"box":{"x":117,"y":672,"width":741,"height":12}},{"id":"12323f3b-e1ae-4371-a3fb-e15024e303a9","block_type":"box","text":"auditors or the independent auditors, and management’s steps to address them. In the absence of","page_number":234,"box":{"x":116,"y":688,"width":731,"height":12}},{"id":"2bd16dfc-a92e-4094-bbe1-2c4717b47ee1","block_type":"box","text":"detailed disclosures, we may conclude that companies are not adequately managing risk.","page_number":234,"box":{"x":116,"y":703,"width":662,"height":12}},{"id":"d75118a7-cb6c-445e-9f53-512692ecfbb6","block_type":"box","text":"Capital structure, mergers, acquisitions, asset sales, and other special situations","page_number":234,"box":{"x":176,"y":741,"width":647,"height":12}},{"id":"69491cb3-84f9-44a0-a712-f3c9e0bd51d2","block_type":"box","text":"The capital structure of a company is critical to shareholders as it impacts the value of their investment","page_number":234,"box":{"x":116,"y":771,"width":761,"height":13}},{"id":"3f9d498d-ac45-42d3-8b91-713b20c2fbcb","block_type":"box","text":"and the priority of their interest in the company relative to that of other equity or debt investors.","page_number":234,"box":{"x":116,"y":787,"width":700,"height":12}},{"id":"9268b5af-9a33-48c2-a555-f2c975f9cdd6","block_type":"box","text":"Pre-emptive rights are a key protection for shareholders against the dilution of their interests.","page_number":234,"box":{"x":117,"y":802,"width":687,"height":13}},{"id":"e8a98bcd-3bbc-4d00-8c05-0b914a98d295","block_type":"box","text":"7","page_number":234,"box":{"x":143,"y":828,"width":4,"height":5}},{"id":"7baf2ba3-e0f9-423e-9f47-f11a3ef8590e","block_type":"box","text":"Enterprise Risk Management is a process, effected by the entity’s board of directors, management, and other","page_number":234,"box":{"x":171,"y":828,"width":648,"height":9}},{"id":"c6d4d983-84cd-4e58-8b1b-6e21d698f4d8","block_type":"box","text":"personnel, applied in strategy setting and across the enterprise, designed to identify potential events that may affect the","page_number":234,"box":{"x":170,"y":840,"width":709,"height":10}},{"id":"c2970e5b-fd14-4656-ae4c-b062e958d75b","block_type":"box","text":"entity, and manage risk to be within the risk appetite, to provide reasonable assurance regarding the achievement of","page_number":234,"box":{"x":170,"y":853,"width":690,"height":10}},{"id":"a4d608a3-5cac-408e-9503-a92ce421b865","block_type":"box","text":"objectives. Please see: The Committee of Sponsoring Organizations of the Treadway Commission (COSO), “Enterprise","page_number":234,"box":{"x":170,"y":866,"width":710,"height":10}},{"id":"c5f32e64-68f6-4542-ae44-a1403c91f5c6","block_type":"box","text":"Risk Management,” 2023, accessed in December 2025.","page_number":234,"box":{"x":171,"y":879,"width":329,"height":10}},{"id":"6015e451-d6cd-440e-b95d-503648e31d1e","block_type":"box","text":"BlackRock Investment Stewardship","page_number":234,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"efe92b43-3f9c-46cb-a858-d7337db90763","block_type":"box","text":"Global Principles |","page_number":234,"box":{"x":735,"y":909,"width":133,"height":12}},{"id":"a6de7833-c32e-48dd-b9ba-49e235f9b04a","block_type":"box","text":"8","page_number":234,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"c9ab06c3-ab7b-4aa4-89e5-f347be42ba8f","block_type":"box","text":"NM0926U-5926888-234/257","page_number":234,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"aa6530fd-5f9e-42ff-a595-10974470e37f","block_type":"box","text":"In principle, we have concerns with the creation of a share class with equivalent economic exposure","page_number":235,"box":{"x":117,"y":87,"width":746,"height":12}},{"id":"65a92ef1-ecab-42d2-8ea4-23fc1bb3570e","block_type":"box","text":"and differentiated voting rights. As a result, BIS generally supports bylaw amendments that introduce","page_number":235,"box":{"x":116,"y":102,"width":754,"height":13}},{"id":"fd59ad06-9998-4498-beb0-610fda67e101","block_type":"box","text":"the adoption of “one share, one vote” for registered shareholders.","page_number":235,"box":{"x":116,"y":118,"width":491,"height":12}},{"id":"3ce99901-8177-409d-9584-bb3c78485c2e","block_type":"box","text":"However, we recognize that in certain markets, at least for a period of time, companies may have a","page_number":235,"box":{"x":117,"y":149,"width":740,"height":13}},{"id":"b1cb7fad-d19e-4fc2-bb3f-db5fada6046d","block_type":"box","text":"valid reason for listing dual classes of shares with differentiated voting rights. In our view, such","page_number":235,"box":{"x":116,"y":165,"width":706,"height":12}},{"id":"55a4662d-3f3a-42b4-be46-dd2f58eca828","block_type":"box","text":"companies should review these share class structures on a regular basis or as company","page_number":235,"box":{"x":116,"y":181,"width":661,"height":12}},{"id":"1b195822-a60c-43e5-84b3-51ef762e1a62","block_type":"box","text":"circumstances change. Additionally, they should seek shareholder approval of their capital structure on","page_number":235,"box":{"x":116,"y":196,"width":769,"height":12}},{"id":"547a300e-0f8d-4c73-a78f-a90aa2bdf876","block_type":"box","text":"a periodic basis via a management proposal at the company’s shareholder meeting. The proposal","page_number":235,"box":{"x":116,"y":212,"width":731,"height":12}},{"id":"987165a3-f070-41d4-9cb2-49f8be8d0bae","block_type":"box","text":"should give unaffiliated shareholders the opportunity to affirm the current structure or establish","page_number":235,"box":{"x":116,"y":227,"width":705,"height":12}},{"id":"e7dae4ad-30e0-4a74-b08c-51e248771d09","block_type":"box","text":"mechanisms to end or phase out controlling structures at the appropriate time, while minimizing costs","page_number":235,"box":{"x":117,"y":243,"width":757,"height":12}},{"id":"2ca92a41-9b37-4da1-9a3f-295b2bf4bbfb","block_type":"box","text":"to shareholders.","page_number":235,"box":{"x":116,"y":258,"width":125,"height":9}},{"id":"de4d7d8f-f1fb-40a6-81ff-154f8cc1426c","block_type":"box","text":"In assessing mergers, asset sales, or other special situations, BIS’ primary consideration is the long","page_number":235,"box":{"x":117,"y":289,"width":745,"height":12}},{"id":"d0c6dfc1-76ab-47b3-946e-4b7be46d00d4","block_type":"box","text":"term financial interests of our clients as shareholders, and so we will review any proposed transaction","page_number":235,"box":{"x":116,"y":305,"width":758,"height":12}},{"id":"901d22fb-389f-49f7-a708-5de5f6744c47","block_type":"box","text":"with that objective in mind. Typically, we review factors such as whether the proposed transaction has","page_number":235,"box":{"x":116,"y":320,"width":760,"height":12}},{"id":"cd732aa6-b85a-40e3-80cb-50a13e2c3483","block_type":"box","text":"the unanimous support of the board and has been negotiated at arm’s length, and whether the board","page_number":235,"box":{"x":116,"y":336,"width":753,"height":12}},{"id":"1f575c05-0409-4e14-820a-c06bade53a09","block_type":"box","text":"or management has clearly explained its economic and strategic rationale. We may also seek","page_number":235,"box":{"x":116,"y":351,"width":699,"height":12}},{"id":"7f012c7e-39f6-434f-be45-34a88a18328b","block_type":"box","text":"reassurance from the board that the financial interests of executives and/or board members in a given","page_number":235,"box":{"x":117,"y":367,"width":761,"height":12}},{"id":"64b80793-70fc-4529-b92f-ebb97065737b","block_type":"box","text":"transaction have not adversely affected their ability to place shareholders’ interests before their own.","page_number":235,"box":{"x":116,"y":382,"width":750,"height":12}},{"id":"b94bda39-f52a-47b4-b892-09f5bc755d0f","block_type":"box","text":"Where the transaction involves related parties, the recommendation to support should come from the","page_number":235,"box":{"x":116,"y":398,"width":755,"height":12}},{"id":"704a6780-d303-4529-a8cf-a1cf4d8b8bbe","block_type":"box","text":"independent directors, a best practice in most markets, and ideally, the terms should have been","page_number":235,"box":{"x":117,"y":414,"width":715,"height":11}},{"id":"13c6ce96-f573-403f-8f40-74344a5be239","block_type":"box","text":"assessed through an independent appraisal process. In addition, it is good practice that it be approved","page_number":235,"box":{"x":116,"y":429,"width":766,"height":12}},{"id":"4e2ab1b2-933e-4e21-af1d-a4d530bf4280","block_type":"box","text":"by a separate vote of the non-conflicted parties.","page_number":235,"box":{"x":117,"y":444,"width":358,"height":12}},{"id":"08645baa-1e51-4241-b294-9362bb6c4b6f","block_type":"box","text":"As a matter of sound governance practice, shareholders should have a right to dispose of company","page_number":235,"box":{"x":116,"y":476,"width":743,"height":12}},{"id":"0a3e068f-9ac5-465c-99fe-7ee6e5de4219","block_type":"box","text":"shares in the open market without unnecessary restriction. In our view, corporate mechanisms","page_number":235,"box":{"x":116,"y":491,"width":705,"height":12}},{"id":"6281be0e-0b6d-4b72-b442-89f3ac26429e","block_type":"box","text":"designed to limit shareholders’ ability to sell their shares are contrary to basic property rights. Such","page_number":235,"box":{"x":116,"y":507,"width":738,"height":12}},{"id":"5f39556f-f291-4ac3-94cd-b606c768f796","block_type":"box","text":"mechanisms can serve to protect and entrench interests other than those of the shareholders. In our","page_number":235,"box":{"x":117,"y":522,"width":750,"height":12}},{"id":"b0cf3bf9-0c50-4a0f-9b07-5c2b55bcb9d1","block_type":"box","text":"view, shareholders are broadly capable of making decisions in their own best interests. We encourage","page_number":235,"box":{"x":116,"y":538,"width":764,"height":12}},{"id":"04237282-f33d-4b2f-a299-10791eaffb2e","block_type":"box","text":"any shareholder rights plans proposed by a board to be subject to shareholder approval upon","page_number":235,"box":{"x":116,"y":553,"width":699,"height":12}},{"id":"f65b284f-0e21-4168-b96d-a62c47c158ed","block_type":"box","text":"introduction and periodically thereafter.","page_number":235,"box":{"x":117,"y":569,"width":293,"height":12}},{"id":"c24a750e-5c6b-4f4e-9291-fbcd1cb40f91","block_type":"box","text":"Executive compensation and benefits","page_number":235,"box":{"x":350,"y":608,"width":305,"height":12}},{"id":"8afdcdda-fbf5-466e-9488-440c66ecd001","block_type":"box","text":"Executive compensation is an important tool used by companies to support long-term financial value","page_number":235,"box":{"x":117,"y":640,"width":749,"height":12}},{"id":"6a43417a-5801-4239-a933-e4a67e0403d0","block_type":"box","text":"creation. A well-structured compensation policy rewards the successful delivery of strategic,","page_number":235,"box":{"x":116,"y":655,"width":686,"height":12}},{"id":"f0a24a33-0c94-4cdb-8697-84e18bcede51","block_type":"box","text":"operational, and/or financial goals; encourages an appropriate risk appetite; and aligns the interests of","page_number":235,"box":{"x":116,"y":671,"width":759,"height":12}},{"id":"771b4d0b-4108-4a7c-8e4d-db2f655ea13a","block_type":"box","text":"shareholders and executives through equity ownership.","page_number":235,"box":{"x":116,"y":686,"width":410,"height":12}},{"id":"9a592622-4fa6-44d9-81d9-14b866c764bf","block_type":"box","text":"8","page_number":235,"box":{"x":528,"y":686,"width":5,"height":6}},{"id":"c584c28d-7b61-460c-86c7-e5cf2642dc27","block_type":"box","text":"We look for a clear link between variable pay and operational and financial performance that support","page_number":235,"box":{"x":116,"y":717,"width":746,"height":13}},{"id":"d4698fbb-d1de-4028-9d4c-c90ee3a37323","block_type":"box","text":"sustained financial value creation for our clients as shareholders. We appreciate when performance","page_number":235,"box":{"x":116,"y":733,"width":739,"height":12}},{"id":"a79bd879-0435-4c01-a8d1-cff05eb65704","block_type":"box","text":"targets incorporate ambitious objectives, and the corresponding metrics are aligned with the","page_number":235,"box":{"x":116,"y":749,"width":682,"height":12}},{"id":"83a5c57e-4056-415c-a9b2-fabf7b02078f","block_type":"box","text":"company’s strategy and business model. BIS does not have a position on whether companies choose","page_number":235,"box":{"x":116,"y":764,"width":755,"height":12}},{"id":"ece79c19-cc0f-4bbc-b7fb-91eb9b369bdf","block_type":"box","text":"to use sustainability-related criteria in compensation structures, but, where they are included, we look","page_number":235,"box":{"x":116,"y":780,"width":752,"height":12}},{"id":"0d04bd19-28a9-4129-ad21-cbd4b3d42f2a","block_type":"box","text":"to companies to be as rigorous as they would be in setting other financial or operational targets. We","page_number":235,"box":{"x":116,"y":795,"width":740,"height":12}},{"id":"2113b93d-3e86-450f-ba5b-a18f1d7ad9ab","block_type":"box","text":"appreciate when long-term incentive plans encompass timeframes that: 1) are distinct from annual","page_number":235,"box":{"x":116,"y":810,"width":730,"height":13}},{"id":"e1374074-cbab-4966-9ad3-329047b785b0","block_type":"box","text":"executive compensation structures and metrics, and 2) encourage the delivery of strong financial","page_number":235,"box":{"x":116,"y":826,"width":724,"height":12}},{"id":"c8d334c0-e782-460e-a479-3ac37d782efb","block_type":"box","text":"results over a period of years.","page_number":235,"box":{"x":117,"y":841,"width":225,"height":13}},{"id":"6a247f0c-c464-440f-9fd9-6a7acdcc22c7","block_type":"box","text":"8","page_number":235,"box":{"x":143,"y":867,"width":4,"height":5}},{"id":"8755a937-3beb-45b2-9041-9e1b93e737ce","block_type":"box","text":"The terms “compensation,” “remuneration,” and “pay” are used interchangeably to describe the same concept in","page_number":235,"box":{"x":170,"y":867,"width":664,"height":9}},{"id":"1764d2fb-eeff-4692-bf1c-823a98df340a","block_type":"box","text":"different markets.","page_number":235,"box":{"x":170,"y":880,"width":102,"height":7}},{"id":"2ff5f957-b990-49b3-ba07-745506b9db93","block_type":"box","text":"BlackRock Investment Stewardship","page_number":235,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"ccee6e0f-0edb-4f83-867e-f8a596073c7e","block_type":"box","text":"Global Principles |","page_number":235,"box":{"x":735,"y":909,"width":133,"height":12}},{"id":"e204a249-078d-4f73-95c4-60eff7fe7699","block_type":"box","text":"9","page_number":235,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"63d539d4-479a-4774-bdbe-8ae9b5a0d3d0","block_type":"box","text":"NM0926U-5926888-235/257","page_number":235,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"a493c8b6-88bc-4d3e-b739-bd16600bd9b7","block_type":"box","text":"We consider it best practice when board members responsible for designing and approving executive","page_number":236,"box":{"x":116,"y":87,"width":757,"height":12}},{"id":"a813e4ea-dff2-4168-b044-779fde49d9a8","block_type":"box","text":"compensation carefully consider the company’s specific circumstances. Factors to consider may","page_number":236,"box":{"x":116,"y":102,"width":720,"height":13}},{"id":"99e99b18-7849-4481-ae19-738b9540a714","block_type":"box","text":"include the company’s risk profile, the environment it operates in, and the individuals the board is trying","page_number":236,"box":{"x":117,"y":118,"width":770,"height":12}},{"id":"e0f649ff-0dea-404f-8b5b-48b536ac5c45","block_type":"box","text":"to attract and retain. We look to the compensation committees to guard against contractual","page_number":236,"box":{"x":116,"y":134,"width":679,"height":12}},{"id":"75d1a1da-b25a-4fa2-b661-eda6bb265fc7","block_type":"box","text":"arrangements that would entitle executives to material compensation for early termination of their","page_number":236,"box":{"x":116,"y":149,"width":726,"height":12}},{"id":"fa94a8e0-13f6-424b-a937-056324be4384","block_type":"box","text":"employment. Finally, we look for pension contributions and other deferred compensation arrangements","page_number":236,"box":{"x":116,"y":165,"width":770,"height":12}},{"id":"362b4ca7-9072-450c-9498-b605fad4c1fd","block_type":"box","text":"to be reasonable in light of market practices or the company’s business and executive compensation","page_number":236,"box":{"x":116,"y":180,"width":752,"height":12}},{"id":"a050a0b0-64f7-47d5-a645-b35e5b0a6759","block_type":"box","text":"strategies.","page_number":236,"box":{"x":116,"y":196,"width":82,"height":12}},{"id":"3873a16d-8d06-406f-8344-e016e7dedf28","block_type":"box","text":"We are not supportive of one-off or special bonuses unrelated to company or individual performance.","page_number":236,"box":{"x":116,"y":227,"width":755,"height":12}},{"id":"e22decd6-b3e0-4375-89f0-76d02e8df528","block_type":"box","text":"Where discretion has been used by the compensation committee, or its equivalent, we appreciate","page_number":236,"box":{"x":116,"y":242,"width":730,"height":12}},{"id":"48eda3b6-6c5a-4f3c-8173-2ffd250e1a8c","block_type":"box","text":"disclosure relating to how and why the discretion was used, and how the adjusted outcome is aligned","page_number":236,"box":{"x":116,"y":258,"width":757,"height":12}},{"id":"3fc53d87-0ecb-4a1d-bbbb-126755743cf6","block_type":"box","text":"with the interests of shareholders. In addition, we acknowledge that the use of peer group evaluation","page_number":236,"box":{"x":116,"y":273,"width":751,"height":12}},{"id":"c6ca67f3-2019-4417-bf1d-d3f9bb2e9ff6","block_type":"box","text":"by compensation committees can help ensure competitive pay. However, we encourage companies to","page_number":236,"box":{"x":117,"y":289,"width":763,"height":12}},{"id":"aeda74c4-7dda-4324-9995-52ca6eb97958","block_type":"box","text":"clearly explain how compensation outcomes have rewarded performance rather than solely base","page_number":236,"box":{"x":116,"y":304,"width":724,"height":12}},{"id":"cce4d49d-0438-4025-9ad3-bc8e47284938","block_type":"box","text":"increases in total compensation on peer benchmarking.","page_number":236,"box":{"x":117,"y":320,"width":416,"height":12}},{"id":"8c03a17e-01e8-482b-a9cc-372a395ee873","block_type":"box","text":"We consider the inclusion of building clawback provisions into incentive plans as good practice. Such","page_number":236,"box":{"x":116,"y":351,"width":755,"height":12}},{"id":"a884bf33-d26f-41b9-872e-151dcab35df6","block_type":"box","text":"provisions could require executives to forgo awards when compensation was based on faulty financial","page_number":236,"box":{"x":117,"y":366,"width":760,"height":12}},{"id":"20ac14f9-c0f8-49b0-a5f1-894ef075994c","block_type":"box","text":"statements or deceptive business practices, or when their behavior caused material financial harm to","page_number":236,"box":{"x":116,"y":382,"width":754,"height":12}},{"id":"fd5d2d88-ee22-437d-bfc0-b41f308b6da3","block_type":"box","text":"shareholders, material reputational risk to the company, or resulted in a criminal investigation.","page_number":236,"box":{"x":116,"y":397,"width":701,"height":12}},{"id":"0465e2b6-390f-49fa-84ce-8ac806d7db48","block_type":"box","text":"In our view, non-executive directors should be compensated in a manner that is commensurate with","page_number":236,"box":{"x":117,"y":428,"width":745,"height":12}},{"id":"bc3bd87e-da8d-4dc2-ab67-ce3a386b78cd","block_type":"box","text":"the time and effort expended in fulfilling their professional responsibilities. Additionally, these","page_number":236,"box":{"x":116,"y":444,"width":691,"height":12}},{"id":"9f411a87-3154-42aa-8398-0347781f2c50","block_type":"box","text":"compensation arrangements should not risk compromising directors’ independence or aligning their","page_number":236,"box":{"x":116,"y":459,"width":743,"height":12}},{"id":"bc77d5b7-bf69-4d7a-8048-24c3e4f8ca21","block_type":"box","text":"interests too closely with those of the management, whom they are charged with overseeing.","page_number":236,"box":{"x":117,"y":475,"width":693,"height":12}},{"id":"9adcd08d-cf57-4fd5-9dc3-7a7b29b437d0","block_type":"box","text":"When assessing compensation proposals, BIS reviews companies’ disclosures to determine whether","page_number":236,"box":{"x":116,"y":506,"width":754,"height":12}},{"id":"9f9cee53-7e72-4208-ae8f-0d7b87d7e0bb","block_type":"box","text":"the board’s approach to executive compensation is rigorous in light of the company’s stated long-term","page_number":236,"box":{"x":116,"y":521,"width":760,"height":12}},{"id":"96cc7ccd-a943-47d2-b105-172be491fc05","block_type":"box","text":"corporate strategy and specific circumstances, as well as local market and policy developments.","page_number":236,"box":{"x":116,"y":537,"width":719,"height":12}},{"id":"4f65e3a1-89d4-4404-92e2-06c72ad01c75","block_type":"box","text":"When our analysis indicates that executive compensation is misaligned with company performance,","page_number":236,"box":{"x":116,"y":568,"width":745,"height":12}},{"id":"7cf89a33-5323-4b52-8ecd-c109a1cedeaf","block_type":"box","text":"BIS may not support management’s proposals to approve compensation, where they are on the","page_number":236,"box":{"x":117,"y":583,"width":715,"height":12}},{"id":"fa7de452-512e-485e-bd95-27afded4be63","block_type":"box","text":"agenda. We may also not support members of the compensation committee or equivalent board","page_number":236,"box":{"x":116,"y":599,"width":719,"height":12}},{"id":"eec914de-647d-440f-821b-128d12d4642e","block_type":"box","text":"members for poor compensation practices or structures.","page_number":236,"box":{"x":117,"y":614,"width":421,"height":12}},{"id":"b87c1df2-8fad-4310-b5b6-f194a292f97f","block_type":"box","text":"Shareholder protections and other corporate governance matters","page_number":236,"box":{"x":239,"y":653,"width":527,"height":12}},{"id":"883b9c08-fb41-4c63-afd0-854e7be48dd8","block_type":"box","text":"Corporate form","page_number":236,"box":{"x":117,"y":684,"width":121,"height":12}},{"id":"63722947-3130-4272-a0f9-b6b86d1871d0","block_type":"box","text":"In our view, it is the responsibility of the board to determine the corporate form that is most appropriate","page_number":236,"box":{"x":117,"y":715,"width":760,"height":12}},{"id":"a076bf56-7b65-496f-8bda-a4c8295e18a3","block_type":"box","text":"given the company’s purpose and business model.","page_number":236,"box":{"x":116,"y":731,"width":376,"height":12}},{"id":"b80e87bc-a16c-4506-8537-b3b8089e9713","block_type":"box","text":"9","page_number":236,"box":{"x":494,"y":731,"width":5,"height":6}},{"id":"1a77ee74-7c0e-43fc-a6fc-f8cdddbba694","block_type":"box","text":"We look to companies proposing to change their","page_number":236,"box":{"x":504,"y":731,"width":361,"height":12}},{"id":"cacb5b09-48df-41eb-90bd-403d7e541f09","block_type":"box","text":"corporate form to a public benefit corporation, or similar entity, to put it to a shareholder vote if not","page_number":236,"box":{"x":116,"y":746,"width":726,"height":12}},{"id":"5f3b0fad-d294-45ba-b248-fd81d727eb17","block_type":"box","text":"already required to do so under applicable law. We appreciate when supporting documentation from","page_number":236,"box":{"x":116,"y":761,"width":742,"height":13}},{"id":"c27e3dd3-dace-43b2-afa3-db4324cc5cc4","block_type":"box","text":"companies or shareholders proposing to alter the corporate form clearly explains how the interests of","page_number":236,"box":{"x":116,"y":777,"width":751,"height":12}},{"id":"70e4e22c-a836-461e-9dc7-a3b6d4772496","block_type":"box","text":"shareholders and different stakeholders would be impacted as well as the accountability and voting","page_number":236,"box":{"x":116,"y":792,"width":735,"height":13}},{"id":"8704eef3-e4cb-4cbb-a4de-620b006ee944","block_type":"box","text":"mechanisms that would be available to shareholders. We generally support management proposals if","page_number":236,"box":{"x":117,"y":808,"width":752,"height":12}},{"id":"8ee5a7c0-51b6-42c9-9bd2-7f8bdfcc558e","block_type":"box","text":"our analysis indicates that shareholders’ financial interests are adequately protected. Corporate form","page_number":236,"box":{"x":116,"y":823,"width":746,"height":13}},{"id":"d93fbb9c-60ef-41db-ac8c-995d658e20d6","block_type":"box","text":"shareholder proposals are evaluated on a case-by-case basis.","page_number":236,"box":{"x":116,"y":839,"width":468,"height":12}},{"id":"5d09c45c-625f-475e-9637-1d2c08d1401d","block_type":"box","text":"9","page_number":236,"box":{"x":143,"y":880,"width":4,"height":5}},{"id":"9dd41182-407c-4790-9af6-8fc4c3f1f517","block_type":"box","text":"Corporate form refers to the legal structure by which a business is organized.","page_number":236,"box":{"x":170,"y":880,"width":457,"height":9}},{"id":"f76d934e-c507-4a95-ac74-b444f0ee90ba","block_type":"box","text":"BlackRock Investment Stewardship","page_number":236,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"44c78d90-4182-427c-9ac3-be7a56b00579","block_type":"box","text":"Global Principles |","page_number":236,"box":{"x":726,"y":909,"width":132,"height":12}},{"id":"2806e3c6-1705-40ad-b4e2-651eff590329","block_type":"box","text":"10","page_number":236,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"00742628-28e1-474c-9878-3dadc99c9352","block_type":"box","text":"NM0926U-5926888-236/257","page_number":236,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"4c1ab607-e4f9-4b77-948d-cf715015bb73","block_type":"box","text":"Shareholder proposals","page_number":237,"box":{"x":409,"y":87,"width":187,"height":12}},{"id":"413c4727-545e-406f-bb15-acb8e3a78dea","block_type":"box","text":"In most markets, shareholders can submit proposals to be voted on at a company’s shareholder","page_number":237,"box":{"x":117,"y":120,"width":717,"height":11}},{"id":"ebc8e03a-a2c8-4b7e-9d65-2c7a8dadbcc0","block_type":"box","text":"meeting, as long as certain requirements are met. Shareholder proposals span a wide range of topics,","page_number":237,"box":{"x":117,"y":135,"width":762,"height":12}},{"id":"3337e431-aac3-4f6c-b57e-3918812374eb","block_type":"box","text":"including governance reforms, capital management, and changes in the management or disclosure of","page_number":237,"box":{"x":117,"y":150,"width":758,"height":12}},{"id":"d6f3393a-749e-4e0d-985c-cd5b0b4390fa","block_type":"box","text":"sustainability-related risks. These proposals have a varying degree of relevance for companies across","page_number":237,"box":{"x":116,"y":166,"width":763,"height":12}},{"id":"f0bcee5b-50ae-4289-9d41-a6b89018ad24","block_type":"box","text":"sectors, locations, and business models.","page_number":237,"box":{"x":116,"y":182,"width":307,"height":11}},{"id":"47685835-ba39-4493-896c-59960fd0f900","block_type":"box","text":"BIS takes a case-by-case approach to voting on shareholder proposals and maintains a singular focus","page_number":237,"box":{"x":117,"y":214,"width":764,"height":12}},{"id":"b185f94b-6512-4ba2-b818-3c31518e32d1","block_type":"box","text":"on the proposal’s implications for long-term financial value creation for shareholders. Our analysis","page_number":237,"box":{"x":116,"y":229,"width":730,"height":12}},{"id":"a582f27a-9457-44d8-b10b-a44b62251a05","block_type":"box","text":"considers whether a shareholder proposal addresses a material risk that may impact a company’s","page_number":237,"box":{"x":116,"y":245,"width":732,"height":12}},{"id":"5375e98b-3b11-4bd4-9853-a28185432deb","block_type":"box","text":"long-term financial performance. BIS may support shareholder proposals that request disclosures that","page_number":237,"box":{"x":117,"y":260,"width":760,"height":12}},{"id":"b806282d-3a97-42f6-8e49-2a327f51fd22","block_type":"box","text":"help us, as long-term investors on behalf of our clients, better understand the material risks and","page_number":237,"box":{"x":117,"y":276,"width":713,"height":12}},{"id":"1aff9e10-7821-4205-8df9-4a97e1e67c21","block_type":"box","text":"opportunities companies face and how they are managing them, especially where this information is","page_number":237,"box":{"x":116,"y":291,"width":747,"height":12}},{"id":"4dee3f18-f92a-4f16-a45d-940a69417e64","block_type":"box","text":"additive given the company’s existing disclosures. We look for consistency between the specific","page_number":237,"box":{"x":116,"y":307,"width":715,"height":12}},{"id":"e532b80a-f740-4a75-b058-0228617574e6","block_type":"box","text":"request formally made in the proposal, the supporting documentation, and the proponents’ other","page_number":237,"box":{"x":117,"y":322,"width":717,"height":12}},{"id":"ad9f1d70-350b-42d6-ad90-f2eb4ca95eb9","block_type":"box","text":"communications on the issues. We also assess the company’s practices and disclosures and the costs","page_number":237,"box":{"x":116,"y":338,"width":769,"height":12}},{"id":"d05bac8c-ae34-40f5-9fbf-eb7fc4023e53","block_type":"box","text":"and benefits to the company of meeting the request made in the proposal. We take into consideration a","page_number":237,"box":{"x":116,"y":353,"width":772,"height":12}},{"id":"dc0d63c6-fff6-4c76-9d75-f8a0e0458033","block_type":"box","text":"company’s governance practices and disclosures against those of their peers.","page_number":237,"box":{"x":116,"y":369,"width":583,"height":12}},{"id":"b46a8eb5-cac2-469e-9e3b-92451cfa3501","block_type":"box","text":"BIS does not support shareholder proposals that we view as inconsistent with long-term financial value","page_number":237,"box":{"x":117,"y":401,"width":767,"height":12}},{"id":"c0a290da-3ee1-46bf-b663-78329f751de3","block_type":"box","text":"or that seek to micromanage companies. We take into consideration the legal effect of the proposal, as","page_number":237,"box":{"x":116,"y":417,"width":769,"height":12}},{"id":"99338e36-6523-4ad9-8dc1-9497d6b7242c","block_type":"box","text":"shareholder proposals may be advisory or legally binding depending on the jurisdiction, while others","page_number":237,"box":{"x":116,"y":432,"width":747,"height":12}},{"id":"aa09ad0b-5794-450e-bbef-d4dca68f1f81","block_type":"box","text":"may make requests that would be deemed illegal in a given jurisdiction.","page_number":237,"box":{"x":117,"y":448,"width":534,"height":12}},{"id":"6a5b4f64-7de7-4315-809f-328a4cf85708","block_type":"box","text":"In our experience, it is helpful when companies disclose the names of the proponent or organization","page_number":237,"box":{"x":117,"y":480,"width":745,"height":12}},{"id":"e17808c3-f9c9-469a-a5b9-368686c54d8f","block_type":"box","text":"that has submitted or advised on the proposal. We recognize that some shareholder proposals bundle","page_number":237,"box":{"x":116,"y":496,"width":762,"height":12}},{"id":"c1d22a28-c7c7-43be-a853-da5a580d75c4","block_type":"box","text":"topics and/or specific requests. Further, the proponent’s supporting statement may refer to topics that","page_number":237,"box":{"x":116,"y":511,"width":758,"height":12}},{"id":"ea91c881-7948-43c3-88d0-7ba0267130f0","block_type":"box","text":"are not directly related to the request made in the proposal. In voting on behalf of clients, we must vote","page_number":237,"box":{"x":116,"y":527,"width":767,"height":12}},{"id":"f9c7db9d-4ff8-405a-aef0-0e0dfad4dce0","block_type":"box","text":"yes or no on the proposal as phrased by the proponent. Therefore, when we vote in support of a","page_number":237,"box":{"x":116,"y":542,"width":720,"height":12}},{"id":"85635f75-9573-4f08-ae31-58792332943f","block_type":"box","text":"proposal, we are not necessarily endorsing every element of the proposal or the reasoning, objectives,","page_number":237,"box":{"x":117,"y":558,"width":765,"height":12}},{"id":"57a311f1-ae3e-459a-868b-4b73ed8ad029","block_type":"box","text":"or supporting statement of the proponent. We may support a proposal for different reasons than those","page_number":237,"box":{"x":116,"y":573,"width":762,"height":12}},{"id":"1a46b190-b8d6-412e-a4d8-bc3724fb7601","block_type":"box","text":"put forth by the proponent, when we believe that overall it may advance our clients’ long-term financial","page_number":237,"box":{"x":117,"y":589,"width":762,"height":12}},{"id":"5b9b3286-f7a8-4738-adc1-8663ba47dc79","block_type":"box","text":"interests.","page_number":237,"box":{"x":117,"y":604,"width":72,"height":10}},{"id":"052bee93-2676-4840-95c3-67179e406f12","block_type":"box","text":"BlackRock is subject to certain rules, regulations, agency guidance, and contractual agreements that","page_number":237,"box":{"x":117,"y":637,"width":752,"height":12}},{"id":"e644dfa1-5714-47dd-a54c-d1ddddac190c","block_type":"box","text":"place restrictions and limitations on how BlackRock can interact with the companies in which we invest","page_number":237,"box":{"x":117,"y":652,"width":766,"height":12}},{"id":"1af46765-3ff4-4ef4-9d72-0a4b6ba99aeb","block_type":"box","text":"on behalf of our clients. BlackRock does not nominate directors for board elections or submit","page_number":237,"box":{"x":116,"y":667,"width":687,"height":10}},{"id":"82e5d77f-69a5-436f-9129-9864ef535e43","block_type":"box","text":"shareholder proposals to companies. Non-compliance with these requirements could adversely affect","page_number":237,"box":{"x":116,"y":683,"width":752,"height":12}},{"id":"042e82e3-1a08-42bf-8e9f-a0367033b794","block_type":"box","text":"BlackRock’s ability to serve its clients’ interests.","page_number":237,"box":{"x":117,"y":699,"width":352,"height":12}},{"id":"1a353e94-2140-455a-9c99-b1af69bf2fa8","block_type":"box","text":"Material sustainability-related risks and opportunities","page_number":237,"box":{"x":287,"y":739,"width":426,"height":12}},{"id":"19aa557e-9b48-44ff-bbbe-f5af7fb9b55f","block_type":"box","text":"Appropriate oversight of material risks and opportunities, including material sustainability-related risks","page_number":237,"box":{"x":116,"y":772,"width":753,"height":12}},{"id":"c9450a18-6fea-4f90-b50d-1834c139517d","block_type":"box","text":"and opportunities, is an important component of having an effective governance framework that","page_number":237,"box":{"x":116,"y":787,"width":709,"height":12}},{"id":"61e677ad-d0c1-4500-b71b-399a46487ba7","block_type":"box","text":"supports durable, long-term financial value creation.","page_number":237,"box":{"x":116,"y":803,"width":385,"height":12}},{"id":"e6403b0f-73bd-46f7-8962-dceb8f408a7f","block_type":"box","text":"10","page_number":237,"box":{"x":503,"y":803,"width":11,"height":6}},{"id":"edf89193-d06e-47c4-95cf-7f71f342ff7a","block_type":"box","text":"10","page_number":237,"box":{"x":144,"y":828,"width":8,"height":5}},{"id":"b620b39c-ea67-4695-9db8-4e09a32fd71a","block_type":"box","text":"By material sustainability-related risks and opportunities, we mean the drivers of risk and financial value creation in a","page_number":237,"box":{"x":171,"y":828,"width":691,"height":9}},{"id":"a5a72b32-d784-440f-bb14-c85448cf6deb","block_type":"box","text":"company’s business model that have an environmental or social dependency or impact. Examples of environmental","page_number":237,"box":{"x":170,"y":841,"width":686,"height":9}},{"id":"77997a62-3fcf-4de1-a20c-a27d88a6f409","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":237,"box":{"x":170,"y":854,"width":682,"height":9}},{"id":"d0fa0d3c-b127-45b4-bc7d-aef646ae7def","block_type":"box","text":"issues include, but are not limited to, human capital management, impacts on the communities in which a company","page_number":237,"box":{"x":170,"y":867,"width":683,"height":9}},{"id":"cc1c325a-5c1a-4b79-bb57-049c7df83887","block_type":"box","text":"operates, customer loyalty, and relationships with regulators.","page_number":237,"box":{"x":170,"y":880,"width":360,"height":9}},{"id":"b5f17f41-55e8-4581-ad42-5a8568e02f5e","block_type":"box","text":"BlackRock Investment Stewardship","page_number":237,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"873e37f7-65a7-4d54-9615-2b48b1ddf0d7","block_type":"box","text":"Global Principles |","page_number":237,"box":{"x":726,"y":909,"width":132,"height":12}},{"id":"8477bdb2-0e16-4610-acb8-6df6533a3d1d","block_type":"box","text":"11","page_number":237,"box":{"x":866,"y":909,"width":15,"height":9}},{"id":"0ecf9f3b-20d3-44a4-a457-7b6c8a51ff1d","block_type":"box","text":"NM0926U-5926888-237/257","page_number":237,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"99115a6d-196f-4360-bd94-94c008281fff","block_type":"box","text":"We look to companies to provide robust disclosure that allows investors to effectively evaluate","page_number":238,"box":{"x":116,"y":87,"width":703,"height":12}},{"id":"b00647c7-5806-44c5-aa70-298835636009","block_type":"box","text":"companies’ strategy and business practices related to material sustainability-related risks and","page_number":238,"box":{"x":116,"y":103,"width":699,"height":12}},{"id":"cb8db354-8e99-4c7d-ae87-c0a48ddc1a40","block_type":"box","text":"opportunities. We find it helpful when companies’ disclosures demonstrate that they have a resilient","page_number":238,"box":{"x":116,"y":118,"width":743,"height":12}},{"id":"4cf4de64-30de-49ac-b4dc-e60e05c73734","block_type":"box","text":"business model that integrates material sustainability-related risks and opportunities into their strategy,","page_number":238,"box":{"x":117,"y":134,"width":766,"height":12}},{"id":"a0f0526c-409e-4b6f-a87a-9d6b3ecabef1","block_type":"box","text":"risk management, and metrics and targets, including industry-specific metrics.","page_number":238,"box":{"x":117,"y":149,"width":583,"height":12}},{"id":"c0a0df62-fd91-49b4-9ae0-3edeac15706f","block_type":"box","text":"Standardized disclosure of sustainability-related data supports investors in making informed decisions.","page_number":238,"box":{"x":116,"y":177,"width":766,"height":12}},{"id":"cea61f02-fe62-4aae-9c62-d994abcefd28","block_type":"box","text":"The International Sustainability Standards Board (ISSB) standards, IFRS S1 and S2, represent one","page_number":238,"box":{"x":116,"y":193,"width":743,"height":12}},{"id":"ce1905fc-0c95-4e83-bc39-425317001661","block_type":"box","text":"such approach to standardization that we find useful in our analysis.","page_number":238,"box":{"x":116,"y":208,"width":503,"height":12}},{"id":"22cc3c8f-7989-48f7-abd4-ea90525e41c2","block_type":"box","text":"11","page_number":238,"box":{"x":622,"y":209,"width":9,"height":6}},{"id":"00472700-76b1-443d-9ba2-94351d7f9636","block_type":"box","text":"However, we do not mandate","page_number":238,"box":{"x":633,"y":209,"width":228,"height":11}},{"id":"c2ec4e0a-515d-4c91-9964-eefd684cc666","block_type":"box","text":"any specific disclosure framework companies should use, and recognize that companies may report","page_number":238,"box":{"x":116,"y":224,"width":747,"height":12}},{"id":"04ead572-c1bc-4b9a-b0e7-bba037e80ac0","block_type":"box","text":"using different standards, some of which may be required by regulation. In such cases, we ask that","page_number":238,"box":{"x":117,"y":239,"width":739,"height":12}},{"id":"f263d519-9d7c-4a47-bfbe-cad253bf5851","block_type":"box","text":"companies highlight the metrics that are industry- or company-specific.","page_number":238,"box":{"x":116,"y":255,"width":530,"height":12}},{"id":"3f07ee1d-2dbd-4139-b4b0-ad79593a363c","block_type":"box","text":"We also recognize that companies may be phasing in reporting over several years. We do not","page_number":238,"box":{"x":116,"y":283,"width":702,"height":12}},{"id":"bb74767d-3527-4a2b-955c-93c7ab49606d","block_type":"box","text":"prescribe timelines regarding when companies should make sustainability-related disclosures but","page_number":238,"box":{"x":117,"y":299,"width":725,"height":12}},{"id":"e26b5081-4882-4f5d-8349-6ba5cdbd6bff","block_type":"box","text":"appreciate it when companies produce them sufficiently in advance of their shareholder meeting, to the","page_number":238,"box":{"x":116,"y":314,"width":770,"height":12}},{"id":"2d44b192-3f8b-4c60-bc5f-dca99161137a","block_type":"box","text":"best of their abilities, to provide investors with time to assess the data and make informed voting","page_number":238,"box":{"x":117,"y":330,"width":718,"height":12}},{"id":"84def753-33a7-45db-b5b8-966fea0cb9ae","block_type":"box","text":"decisions.","page_number":238,"box":{"x":116,"y":345,"width":79,"height":10}},{"id":"3cdc9c59-8cb2-473a-b40e-41b07c065012","block_type":"box","text":"Industry initiatives on managing specific operational risks may also provide useful guidance to","page_number":238,"box":{"x":117,"y":374,"width":700,"height":12}},{"id":"89011480-d986-4481-8adc-88da14f896a3","block_type":"box","text":"companies on best practices and disclosures. While not a voting item, we find it helpful to our","page_number":238,"box":{"x":116,"y":389,"width":697,"height":12}},{"id":"f001af6e-d03d-43fe-9d97-e3e6db221b9e","block_type":"box","text":"understanding of investment risk when companies disclose any relevant global sustainability-related","page_number":238,"box":{"x":117,"y":405,"width":746,"height":12}},{"id":"40098fad-62fe-4b24-b075-afd8d16edff4","block_type":"box","text":"standards adopted, the industry initiatives in which they participate, any peer group benchmarking","page_number":238,"box":{"x":116,"y":420,"width":731,"height":12}},{"id":"a0c922f8-17e8-4ce6-924d-c43a1e4bc97e","block_type":"box","text":"undertaken, and any assurance processes to help investors understand their approach to sustainable","page_number":238,"box":{"x":117,"y":436,"width":758,"height":12}},{"id":"37a5f10d-ca79-4402-b9b0-099e50744da0","block_type":"box","text":"and responsible business practices.","page_number":238,"box":{"x":116,"y":451,"width":271,"height":12}},{"id":"21610299-9926-49cb-9b68-f207e0aacdb4","block_type":"box","text":"Climate and nature-related risk","page_number":238,"box":{"x":117,"y":480,"width":250,"height":9}},{"id":"c98c9ddf-38ed-4cf6-a32e-fd6238f352c2","block_type":"box","text":"Many companies are assessing how to navigate the low-carbon transition while delivering long-term","page_number":238,"box":{"x":117,"y":508,"width":745,"height":12}},{"id":"1f37b93b-64ec-4ebf-b1b2-f4f9e83e3657","block_type":"box","text":"financial value to investors. For companies facing material climate-related risks, we find it helpful when","page_number":238,"box":{"x":116,"y":523,"width":766,"height":12}},{"id":"5b0964c2-5ad6-4fe4-a02d-1af1c9fbd217","block_type":"box","text":"they publicly disclose, consistent with their business model and sector, how they intend to deliver long","page_number":238,"box":{"x":116,"y":539,"width":762,"height":12}},{"id":"afb975f4-6480-4b1a-bce3-9754aaa9b4f2","block_type":"box","text":"term financial performance through the low-carbon transition, including where available, their transition","page_number":238,"box":{"x":116,"y":554,"width":766,"height":12}},{"id":"d40dcea9-a7af-4108-8d20-640a7a19311e","block_type":"box","text":"plan.","page_number":238,"box":{"x":117,"y":570,"width":34,"height":12}},{"id":"126057a4-c0e2-400f-ba45-545a9ef021b6","block_type":"box","text":"12, 13","page_number":238,"box":{"x":153,"y":570,"width":29,"height":7}},{"id":"8cc2d91a-f18b-426b-b746-75844d94a9c8","block_type":"box","text":"From company disclosures and engagement, we seek to understand the strategies","page_number":238,"box":{"x":182,"y":570,"width":626,"height":12}},{"id":"c0fd3679-7bf2-4376-b5ef-0bb9f9c757dc","block_type":"box","text":"companies have in place to manage material risks to, and opportunities for, their long-term business","page_number":238,"box":{"x":116,"y":585,"width":748,"height":12}},{"id":"554103cd-c062-4537-b774-0ee2548dda10","block_type":"box","text":"model associated with a range of climate-related scenarios.","page_number":238,"box":{"x":117,"y":601,"width":446,"height":12}},{"id":"ced1936c-7efb-4fe8-824c-51fb1fce6cbb","block_type":"box","text":"Recognizing the value of these disclosures, certain markets such as the European Union mandate","page_number":238,"box":{"x":117,"y":629,"width":734,"height":12}},{"id":"c5f416a7-775d-49d4-82b7-f2d23bfd7adf","block_type":"box","text":"large companies to disclose such climate-related financial information, while in other jurisdictions these","page_number":238,"box":{"x":117,"y":645,"width":767,"height":12}},{"id":"ba706323-be70-49ec-a58f-91bb857bb47b","block_type":"box","text":"disclosures are viewed as best practice in the market.","page_number":238,"box":{"x":116,"y":660,"width":398,"height":12}},{"id":"3f9f57ce-ec4c-4389-bf15-3e6e745bfb4b","block_type":"box","text":"11","page_number":238,"box":{"x":144,"y":685,"width":7,"height":5}},{"id":"6da22880-cb04-41c8-b843-31648920a9c2","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Reporting Standards (IFRS)","page_number":238,"box":{"x":170,"y":685,"width":666,"height":10}},{"id":"602e6a01-bc04-4be3-9def-c4b0d4a2b3dc","block_type":"box","text":"Foundation. The standards build on the Task Force on Climate-related Financial Disclosures (TCFD) framework and the","page_number":238,"box":{"x":171,"y":698,"width":712,"height":10}},{"id":"dad2a747-83df-497f-98e2-a53608dd1ee1","block_type":"box","text":"standards and metrics developed by the Sustainability Accounting Standards Board (SASB), which have both","page_number":238,"box":{"x":170,"y":711,"width":649,"height":10}},{"id":"eb247c6e-c59e-4393-a435-5933b68a630d","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":238,"box":{"x":170,"y":724,"width":674,"height":10}},{"id":"1ce95dab-8563-46b3-8375-e86ec62b066f","block_type":"box","text":"“General Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related","page_number":238,"box":{"x":170,"y":737,"width":647,"height":10}},{"id":"a2c93545-70d9-412b-97e5-57f1f5fcfb7f","block_type":"box","text":"Disclosures.” Websites accessed in December 2025.","page_number":238,"box":{"x":171,"y":750,"width":312,"height":8}},{"id":"c423fc2c-b393-420e-ba0d-c7a8c9aa3b84","block_type":"box","text":"12","page_number":238,"box":{"x":144,"y":763,"width":8,"height":5}},{"id":"7d46669f-a161-46bf-bb39-261d88513710","block_type":"box","text":"We have observed that more companies are developing such plans, and public policymakers in certain markets are","page_number":238,"box":{"x":170,"y":763,"width":685,"height":10}},{"id":"fd987e4d-3ed5-40d6-a529-b4f99a9583d1","block_type":"box","text":"signaling their intentions to require them or already have requirements in place, such as Australia, Brazil, and the","page_number":238,"box":{"x":170,"y":776,"width":670,"height":10}},{"id":"676ebf3e-2e60-4ec3-94d1-db9769c152d3","block_type":"box","text":"European Union (please see the International Transition Plan Network for information). We view transition plans as a","page_number":238,"box":{"x":171,"y":789,"width":691,"height":9}},{"id":"0a291d62-76a7-48db-af22-682f176903a9","block_type":"box","text":"method for a company to both internally assess and externally communicate its long-term strategy, ambition, objectives,","page_number":238,"box":{"x":170,"y":802,"width":710,"height":9}},{"id":"e5ebea37-b401-41aa-a110-3abc3c6fa2ba","block_type":"box","text":"and actions to create financial value through the global transition towards a low-carbon economy. Across the landscape","page_number":238,"box":{"x":170,"y":815,"width":709,"height":9}},{"id":"9ae233ce-602f-48e3-b17e-11d42348d121","block_type":"box","text":"there remains divergence on the objectives of such plans and the details they should contain. While transition plans can","page_number":238,"box":{"x":170,"y":828,"width":710,"height":9}},{"id":"443ad674-11b0-484f-be83-e55bfb6990d2","block_type":"box","text":"be helpful disclosure, BIS does not make the preparation and production of transition plans a voting issue. BIS may","page_number":238,"box":{"x":170,"y":840,"width":684,"height":10}},{"id":"0fc4d242-9e4c-47c5-9b49-c006efd44a24","block_type":"box","text":"engage companies that have chosen to publish a transition plan to understand their planned actions and resource","page_number":238,"box":{"x":170,"y":853,"width":675,"height":10}},{"id":"56b4e3cd-ad4a-4ecd-86a5-f90669c491bc","block_type":"box","text":"implications. Website accessed in December 2025.","page_number":238,"box":{"x":170,"y":866,"width":303,"height":10}},{"id":"9fc5b1d0-0f71-4249-953f-2e72395081ba","block_type":"box","text":"13","page_number":238,"box":{"x":144,"y":879,"width":8,"height":5}},{"id":"c1ac49e5-214a-4260-bbbc-6f013e53c8e1","block_type":"box","text":"For more information, please see our commentary “Climate-related risks and a low-carbon transition,” December 2025.","page_number":238,"box":{"x":171,"y":879,"width":703,"height":10}},{"id":"1b82d7dc-d19f-4bf5-b59b-d2e5ae900469","block_type":"box","text":"BlackRock Investment Stewardship","page_number":238,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"5b299ff0-dcd2-4611-8a20-40f9c64b82a6","block_type":"box","text":"Global Principles |","page_number":238,"box":{"x":726,"y":909,"width":132,"height":12}},{"id":"5bda67f0-6211-4a62-9346-e0e243170138","block_type":"box","text":"12","page_number":238,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"1fa0d0a4-71c4-48cf-bce2-19fd67fa0f9a","block_type":"box","text":"NM0926U-5926888-238/257","page_number":238,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"ac02a8af-f89a-44c8-b15f-10490669fb2b","block_type":"box","text":"The ISSB standards provide one such framework that can assist investors in assessing company","page_number":239,"box":{"x":116,"y":87,"width":726,"height":12}},{"id":"bcbcb8ea-83df-4d3b-b76a-08357b610b34","block_type":"box","text":"specific climate-related risks and opportunities, and informing investment decisions. Such disclosures","page_number":239,"box":{"x":116,"y":102,"width":757,"height":13}},{"id":"912e6728-6b23-4f23-b07f-d61aa78d0f34","block_type":"box","text":"also provide investors with insights into how companies are managing the risks associated with a","page_number":239,"box":{"x":116,"y":118,"width":726,"height":12}},{"id":"84fceeee-f1ef-4fe9-a9de-3fd33857ce7f","block_type":"box","text":"transition to a low-carbon economy by managing their own carbon emissions or emissions intensities","page_number":239,"box":{"x":116,"y":134,"width":754,"height":12}},{"id":"786a875c-82a2-4ea9-a368-67e9bd8ce390","block_type":"box","text":"to the extent financially practicable.","page_number":239,"box":{"x":116,"y":149,"width":266,"height":12}},{"id":"1bb9d1c9-98b3-47e4-b48b-4d1db6004956","block_type":"box","text":"The ISSB standards, for example, contemplate disclosures on how companies are setting short-,","page_number":239,"box":{"x":116,"y":177,"width":723,"height":12}},{"id":"47f52e7d-c64c-466d-b726-ce7a4f693fbb","block_type":"box","text":"medium- and long-term targets, ideally science-based where these are available for their sector, for","page_number":239,"box":{"x":117,"y":193,"width":742,"height":12}},{"id":"1e08111b-d1df-460e-862c-68bb2dd0030f","block_type":"box","text":"scope 1 and 2 greenhouse gas emissions (GHG) reductions and to demonstrate how their targets are","page_number":239,"box":{"x":116,"y":208,"width":760,"height":12}},{"id":"d9208241-578d-4ed6-a91a-88a99a9bfc20","block_type":"box","text":"consistent with the long-term financial interests of their investors.","page_number":239,"box":{"x":116,"y":224,"width":486,"height":12}},{"id":"b41c89fc-24a4-4a6e-934b-55c341691adc","block_type":"box","text":"While we recognize that regulators in some markets are moving to mandate certain disclosures, at this","page_number":239,"box":{"x":116,"y":252,"width":766,"height":12}},{"id":"d8a718a3-b877-492e-960d-d72e3749ed09","block_type":"box","text":"stage, we view scope 3 emissions differently from scopes 1 and 2, given methodological complexity,","page_number":239,"box":{"x":116,"y":268,"width":749,"height":12}},{"id":"d7d74f46-d048-4a1f-8419-88cc5bece33d","block_type":"box","text":"regulatory uncertainty, concerns about double-counting, and lack of direct control by companies. We","page_number":239,"box":{"x":117,"y":283,"width":749,"height":12}},{"id":"466f439c-8175-4719-b0ca-073452681d57","block_type":"box","text":"welcome disclosures and commitments that companies choose to make regarding material scope 3","page_number":239,"box":{"x":116,"y":299,"width":744,"height":12}},{"id":"3ef65df3-98c2-496d-9acd-e5eae8d136c3","block_type":"box","text":"emissions and recognize that these are provided on a good-faith basis as methodology develops.","page_number":239,"box":{"x":116,"y":314,"width":728,"height":12}},{"id":"c6a213c9-c5c8-4899-ab8a-de76c86f23b9","block_type":"box","text":"In addition to climate-related risks and opportunities, for companies whose strategies, operations or","page_number":239,"box":{"x":117,"y":343,"width":742,"height":12}},{"id":"4b207e4b-a118-4fdc-a1a5-bfc240c078db","block_type":"box","text":"supply chains are materially reliant on natural capital, nature-related risks and opportunities may affect","page_number":239,"box":{"x":116,"y":358,"width":765,"height":12}},{"id":"3fd1aa03-a073-4a94-93d2-861488a1b046","block_type":"box","text":"their ability to generate long-term financial returns.","page_number":239,"box":{"x":116,"y":374,"width":372,"height":12}},{"id":"a5bdfd08-757c-41ad-9aa9-419d724a69d4","block_type":"box","text":"14","page_number":239,"box":{"x":491,"y":374,"width":11,"height":6}},{"id":"ce6cf8ce-3be2-472e-8741-42577294118f","block_type":"box","text":"For these companies, we rely on disclosures to","page_number":239,"box":{"x":502,"y":374,"width":360,"height":12}},{"id":"cdfcac08-670a-40d5-85e3-0e419401697c","block_type":"box","text":"understand how their strategies consider nature-related impacts and dependencies and to assess how","page_number":239,"box":{"x":117,"y":389,"width":765,"height":12}},{"id":"01f55a27-40ea-4f15-9ab1-775ac836eca0","block_type":"box","text":"the board oversees these risks.","page_number":239,"box":{"x":116,"y":405,"width":232,"height":9}},{"id":"bf6bc360-89fd-4ae3-98da-a0a804adfb9f","block_type":"box","text":"15","page_number":239,"box":{"x":351,"y":405,"width":10,"height":6}},{"id":"2377a5e7-1bea-474a-9c41-1fa6e36310d8","block_type":"box","text":"Companies’ impact on their workforce, supply chains, and communities","page_number":239,"box":{"x":117,"y":433,"width":579,"height":12}},{"id":"e3909532-9a98-41e9-9598-5ee38f916be0","block_type":"box","text":"Companies determine their key stakeholders based on what is material to their business and long-term","page_number":239,"box":{"x":117,"y":461,"width":768,"height":12}},{"id":"0f0ef20b-e5f1-4b27-9791-556dee96c765","block_type":"box","text":"financial performance. For many companies, key stakeholders include employees, business supply","page_number":239,"box":{"x":116,"y":477,"width":741,"height":12}},{"id":"51a7008f-72e9-4d26-bd78-f8f96eb18ba8","block_type":"box","text":"chains, clients and consumers, regulators, and the communities in which they operate.","page_number":239,"box":{"x":116,"y":493,"width":647,"height":11}},{"id":"27595d5a-e0e5-450b-a625-9ea2b38573c7","block_type":"box","text":"In our experience, companies that invest in the relationships that are critical to their strategic objectives","page_number":239,"box":{"x":117,"y":521,"width":769,"height":12}},{"id":"32facb35-7ecb-46f1-bf75-fa405e923a2d","block_type":"box","text":"are more likely to deliver durable, long-term financial performance. By contrast, we have found that","page_number":239,"box":{"x":116,"y":536,"width":739,"height":12}},{"id":"b933a774-88b6-4337-a67a-e22473a1e9b1","block_type":"box","text":"poor relationships may create adverse impacts that could expose companies to legal, regulatory,","page_number":239,"box":{"x":117,"y":552,"width":722,"height":12}},{"id":"9319293a-2735-4021-a460-7ddc0db45201","block_type":"box","text":"operational, and reputational risks. This is particularly relevant to a company’s workforce, which is","page_number":239,"box":{"x":116,"y":567,"width":730,"height":12}},{"id":"eff093f1-15da-494e-874c-621e71a23ade","block_type":"box","text":"central to long-term financial value creation.","page_number":239,"box":{"x":116,"y":583,"width":324,"height":12}},{"id":"1ced1708-cc1e-4986-9fec-6de25c65215d","block_type":"box","text":"16","page_number":239,"box":{"x":442,"y":583,"width":11,"height":6}},{"id":"f8796c39-f3f0-43eb-8469-2f60fbf89aec","block_type":"box","text":"As a long-term shareholder on behalf of our clients, we find it helpful when companies disclose how","page_number":239,"box":{"x":116,"y":611,"width":743,"height":12}},{"id":"7c6a3925-0b34-428c-ab73-64eeec0de8e1","block_type":"box","text":"they have identified their key stakeholders and considered their interests in business decision-making.","page_number":239,"box":{"x":116,"y":627,"width":763,"height":12}},{"id":"3d288829-fea7-4102-bbaa-e486a624e990","block_type":"box","text":"In addition to understanding broader stakeholder relationships, BIS finds it helpful when companies","page_number":239,"box":{"x":117,"y":642,"width":740,"height":12}},{"id":"54cf043e-5bb1-4daf-be6d-893c74ba4a20","block_type":"box","text":"discuss how they consider the needs of their workforce today, and the skills required for their future","page_number":239,"box":{"x":116,"y":658,"width":742,"height":12}},{"id":"d4359f5d-4c32-4779-b828-0e39032cb203","block_type":"box","text":"business strategy. We are also interested in understanding how the board monitors and engages on","page_number":239,"box":{"x":117,"y":673,"width":741,"height":12}},{"id":"f8533bdd-2aca-4f07-8ead-02d429f4e965","block_type":"box","text":"these matters, given it is well positioned to ensure that the approach taken by management is informed","page_number":239,"box":{"x":116,"y":689,"width":764,"height":12}},{"id":"068d1ba2-6080-4d2d-b95c-81bd0c941745","block_type":"box","text":"by and aligns with the company’s strategy. BIS does not direct a company’s policies or practices, which","page_number":239,"box":{"x":117,"y":704,"width":765,"height":12}},{"id":"03ef31cb-be16-46c5-999c-0ec8f2cb5a41","block_type":"box","text":"are the responsibility of management and the board.","page_number":239,"box":{"x":116,"y":720,"width":387,"height":12}},{"id":"7e70f465-73b5-4b74-be30-913e91120b4f","block_type":"box","text":"In addition, we find it helpful when companies disclose their approach to addressing material adverse","page_number":239,"box":{"x":117,"y":748,"width":749,"height":12}},{"id":"c28ec876-291c-48fd-8123-e0d6bdc16ec4","block_type":"box","text":"impacts that could arise from their business practices and affect critical relationships with their","page_number":239,"box":{"x":117,"y":763,"width":697,"height":12}},{"id":"e23fb2ce-2b87-478d-87f4-2c4796711336","block_type":"box","text":"14","page_number":239,"box":{"x":144,"y":789,"width":8,"height":5}},{"id":"a49904b0-b8eb-4911-a8b2-c6212fbb26c5","block_type":"box","text":"For more information, please see our commentary “Our approach to engagement on natural capital,” December 2025.","page_number":239,"box":{"x":171,"y":789,"width":697,"height":9}},{"id":"f292b09d-3063-4a28-888a-3283c089de17","block_type":"box","text":"15","page_number":239,"box":{"x":144,"y":802,"width":8,"height":5}},{"id":"7a3a0954-e72d-437c-a7da-e802c6ba2c7e","block_type":"box","text":"Given the growing awareness of the materiality of these issues for certain businesses, enhanced reporting on a","page_number":239,"box":{"x":170,"y":802,"width":660,"height":9}},{"id":"b3a55ca6-573c-4b90-b8bd-1e2875746b99","block_type":"box","text":"company’s natural capital dependencies and impacts would aid investors’ understanding. The recommendations of the","page_number":239,"box":{"x":170,"y":814,"width":704,"height":10}},{"id":"88eba386-a08c-41cd-bfb9-164183399fdd","block_type":"box","text":"Taskforce on Nature-related Financial Disclosures (TNFD) may prove useful to some companies. We recognize that","page_number":239,"box":{"x":170,"y":827,"width":689,"height":10}},{"id":"58289037-6a02-4deb-94fc-a0b3b3d29c72","block_type":"box","text":"some companies may report using different standards, which may be required by regulation, or one of a number of","page_number":239,"box":{"x":170,"y":840,"width":680,"height":10}},{"id":"dcb996a0-56cb-4c51-95d4-f5ec38b13f81","block_type":"box","text":"other private sector standards. TNFD-aligned reporting is not a voting issue. Website accessed in December 2025.","page_number":239,"box":{"x":170,"y":853,"width":680,"height":10}},{"id":"7268892f-1ada-4856-9b36-ffbe60ca3d3c","block_type":"box","text":"16","page_number":239,"box":{"x":144,"y":866,"width":8,"height":5}},{"id":"06878e99-d20b-4e27-90d2-55c137c48ede","block_type":"box","text":"For more information, please see our commentary “Our approach to engagement on human capital management,”","page_number":239,"box":{"x":171,"y":866,"width":677,"height":10}},{"id":"71c57518-e7bd-487b-8265-8405cf762d7f","block_type":"box","text":"December 2025.","page_number":239,"box":{"x":171,"y":879,"width":97,"height":8}},{"id":"196958a6-a69e-40fc-99eb-5c3ec0866d8d","block_type":"box","text":"BlackRock Investment Stewardship","page_number":239,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"f8aac6b7-a4b5-493f-9ee1-8e7cbfc71896","block_type":"box","text":"Global Principles |","page_number":239,"box":{"x":726,"y":909,"width":132,"height":12}},{"id":"5e5ee541-dc87-4d9f-8621-a171c8170678","block_type":"box","text":"13","page_number":239,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"778a47d8-2483-492b-bff0-abce0f329eb3","block_type":"box","text":"NM0926U-5926888-239/257","page_number":239,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"d0be27fe-68da-4cf6-8ebf-40eaafa529db","block_type":"box","text":"stakeholders. We encourage companies to implement, to the extent appropriate, monitoring processes","page_number":240,"box":{"x":116,"y":87,"width":767,"height":12}},{"id":"0b52a969-f78b-4285-a21e-bd710bccc64d","block_type":"box","text":"(often referred to as due diligence) to identify and mitigate potential adverse impacts and grievance","page_number":240,"box":{"x":117,"y":102,"width":740,"height":13}},{"id":"c97a5189-5260-4ec3-a1ab-dd3d4f6f730e","block_type":"box","text":"mechanisms to remediate any actual adverse material impacts.","page_number":240,"box":{"x":117,"y":118,"width":474,"height":12}},{"id":"20379569-d5d2-45a0-ac62-d16166e8c071","block_type":"box","text":"We look to boards to oversee management’s approach to addressing material risks related to key","page_number":240,"box":{"x":116,"y":148,"width":729,"height":12}},{"id":"3c649537-f9f8-48dc-8c6e-b26abd35b71c","block_type":"box","text":"stakeholders and may convey concerns about board oversight in our voting on director elections or","page_number":240,"box":{"x":116,"y":164,"width":739,"height":12}},{"id":"77e6ca2e-484e-469b-b794-d044a8865cac","block_type":"box","text":"supporting a business relevant shareholder proposal when, in our assessment, the board is not acting","page_number":240,"box":{"x":116,"y":179,"width":761,"height":12}},{"id":"bde33df1-6d90-4970-a8ae-296027bf9b92","block_type":"box","text":"in shareholders’ long-term financial interests.","page_number":240,"box":{"x":117,"y":195,"width":337,"height":12}},{"id":"e30e43f8-8719-4c62-bb34-e238f995c6ed","block_type":"box","text":"BlackRock’s oversight of its investment stewardship activities","page_number":240,"box":{"x":251,"y":232,"width":503,"height":12}},{"id":"ee057c7f-1c36-4ffd-b2a8-239b9b363e67","block_type":"box","text":"BIS’ governance structure supports oversight and accountability of stewardship-related activities on","page_number":240,"box":{"x":117,"y":262,"width":742,"height":12}},{"id":"62a2ed97-7afa-424c-89ec-83e6e0a55ddd","block_type":"box","text":"behalf of clients at the global and regional level.","page_number":240,"box":{"x":117,"y":278,"width":358,"height":12}},{"id":"8cbad01c-951d-4ac4-95e4-af2043180647","block_type":"box","text":"At the top of this governance structure, the risk-focused BIS Global Oversight Committee (the","page_number":240,"box":{"x":116,"y":308,"width":699,"height":12}},{"id":"4e5345dc-c83f-4c98-9fa0-16d741efe0c7","block_type":"box","text":"Committee) supports BIS’ regulatory responsibilities in relation to proxy voting, including adherence to","page_number":240,"box":{"x":117,"y":324,"width":760,"height":12}},{"id":"1a172dc1-6031-4655-8b40-f26a96689df7","block_type":"box","text":"policies and procedures as well as market-level stewardship requirements. The Committee reviews","page_number":240,"box":{"x":117,"y":339,"width":740,"height":12}},{"id":"c1b04f32-7bad-431e-9407-e4f711c1af3c","block_type":"box","text":"and approves amendments to the Global Principles and regional voting guidelines. The Committee","page_number":240,"box":{"x":116,"y":355,"width":738,"height":12}},{"id":"0adc2154-4ddb-4b94-9d6c-37fd65483f37","block_type":"box","text":"also reviews periodic reports regarding the votes cast by BIS on behalf of clients, as well as updates","page_number":240,"box":{"x":116,"y":370,"width":749,"height":12}},{"id":"775a6a34-fd79-4ef2-8e7a-5b4d39a7bd1b","block_type":"box","text":"on material process issues, procedural changes, and other risk oversight considerations. The","page_number":240,"box":{"x":116,"y":386,"width":697,"height":12}},{"id":"124d603b-13e4-45c3-8f35-41b11f99a478","block_type":"box","text":"Committee is chaired by the Global Heads of the Investment Stewardship function and its members","page_number":240,"box":{"x":117,"y":401,"width":743,"height":12}},{"id":"e30b0364-8eac-4f2e-9ad3-966835eea60f","block_type":"box","text":"include senior BlackRock executives with legal, risk, and other experience relevant to team oversight","page_number":240,"box":{"x":117,"y":417,"width":752,"height":12}},{"id":"8ec873cf-1e4b-42a6-a021-479d81a408de","block_type":"box","text":"who are independent from the investment stewardship function.","page_number":240,"box":{"x":116,"y":432,"width":477,"height":12}},{"id":"766b53f7-dfe0-48c8-aef3-6d5566e69e80","block_type":"box","text":"The Global Heads have primary oversight of BIS’ activities globally, including voting in accordance with","page_number":240,"box":{"x":116,"y":462,"width":769,"height":12}},{"id":"565d1447-2929-4812-9b45-d70f3ea25ac0","block_type":"box","text":"the Global Principles and regional voting guidelines. At the regional level, three regional Heads for the","page_number":240,"box":{"x":116,"y":478,"width":761,"height":12}},{"id":"110b2adb-8b51-4c96-bbab-d6ac1643d62c","block_type":"box","text":"Americas, APAC, and EMEA oversee BIS’ activities for their specific markets.","page_number":240,"box":{"x":116,"y":493,"width":581,"height":12}},{"id":"acb93e52-f304-4512-88cf-653d98245e4f","block_type":"box","text":"Vote execution","page_number":240,"box":{"x":118,"y":524,"width":122,"height":9}},{"id":"bd5834e4-45f2-4d22-905d-af8fa9a8570d","block_type":"box","text":"BIS votes proxies on behalf of index equity funds and accounts when authorized by our clients. We","page_number":240,"box":{"x":117,"y":554,"width":739,"height":12}},{"id":"1fac1ed7-67a5-45da-abd6-d73162c971bb","block_type":"box","text":"have processes in place to consider all proxies for which we have voting authority, and submit voting","page_number":240,"box":{"x":117,"y":569,"width":751,"height":12}},{"id":"35dbbb25-16a9-44c4-8cff-62008a79925e","block_type":"box","text":"decisions, or refrain from voting when logistical issues arise (see below). The BIS Benchmark","page_number":240,"box":{"x":116,"y":585,"width":698,"height":12}},{"id":"d3bef326-6de3-4096-88ba-751bf4c3d441","block_type":"box","text":"Policies – and the vote decisions made consistent with those policies – reflect our reasonable and","page_number":240,"box":{"x":117,"y":600,"width":730,"height":12}},{"id":"fc35a7b6-0cfc-4d0c-9331-49d57f333787","block_type":"box","text":"independent judgment and are made without regard to the relationship between the issuer of the proxy","page_number":240,"box":{"x":117,"y":616,"width":766,"height":12}},{"id":"6bfb3b0f-ba80-46da-b4a5-daadc5d1204e","block_type":"box","text":"(or any shareholder proponent or dissident shareholder) and the Fund, the Fund’s affiliates (if any),","page_number":240,"box":{"x":117,"y":631,"width":739,"height":12}},{"id":"3189dd17-4ab5-47ba-ab18-d92c431b1eb6","block_type":"box","text":"BlackRock or BlackRock’s affiliates, or BlackRock employees (see “Conflicts management policies and","page_number":240,"box":{"x":117,"y":647,"width":768,"height":12}},{"id":"68d757fd-c5e8-4d3c-8b66-643a5dbf6272","block_type":"box","text":"procedures,” below).","page_number":240,"box":{"x":117,"y":662,"width":151,"height":12}},{"id":"4e54a922-863f-4ffe-aa7b-ed439f712be0","block_type":"box","text":"In certain markets, proxy voting involves logistical issues which can affect BIS’ ability to vote, as well","page_number":240,"box":{"x":117,"y":692,"width":743,"height":12}},{"id":"134fd233-fd58-4c12-b4ef-fe68982061a8","block_type":"box","text":"as the cost of voting such proxies on behalf of our clients. These issues include, but are not limited to:","page_number":240,"box":{"x":116,"y":708,"width":754,"height":12}},{"id":"8e5a96a4-cb93-455a-98b7-c764565937f5","block_type":"box","text":"1) untimely notice of shareholder meetings; 2) restrictions on a foreigner’s ability to exercise votes; 3)","page_number":240,"box":{"x":118,"y":723,"width":748,"height":12}},{"id":"42e89038-20a6-4b31-8172-623d8bd8b6fb","block_type":"box","text":"requirements to vote proxies in person; 4) “share-blocking” (requirements that investors who exercise","page_number":240,"box":{"x":117,"y":739,"width":751,"height":12}},{"id":"a0ce6f0a-a80e-4e9b-8bb2-82fb52e6217d","block_type":"box","text":"their voting rights surrender the right to dispose of their holdings from the point at which votes are","page_number":240,"box":{"x":116,"y":754,"width":723,"height":12}},{"id":"c5da7027-c4e6-49d9-aa09-8487235dfb65","block_type":"box","text":"submitted until after the after the shareholder meeting has occurred); 5) potential difficulties in","page_number":240,"box":{"x":116,"y":770,"width":695,"height":12}},{"id":"3279b2de-a9e1-4bed-a646-5dbd7a14c44e","block_type":"box","text":"translating the proxy; 6) regulatory constraints; and 7) requirements to provide local agents with","page_number":240,"box":{"x":116,"y":785,"width":708,"height":12}},{"id":"2a77e679-4c39-4829-b888-c05e2cefec28","block_type":"box","text":"powers of attorney to facilitate voting instructions. We are not supportive of impediments to the","page_number":240,"box":{"x":117,"y":801,"width":701,"height":12}},{"id":"e5c3e239-b192-4375-9206-43cc960b2926","block_type":"box","text":"exercise of voting rights such as share-blocking or overly burdensome administrative requirements.","page_number":240,"box":{"x":116,"y":816,"width":735,"height":12}},{"id":"1ee2cc60-48f0-4fc6-a51d-ddf658b11d17","block_type":"box","text":"BIS votes proxies in these situations on a “best-efforts” basis. In addition, BIS may determine that it is","page_number":240,"box":{"x":117,"y":846,"width":758,"height":13}},{"id":"3b8c1393-3339-4eac-975f-a6ee6b21433d","block_type":"box","text":"generally in the interests of BlackRock’s clients not to vote proxies (or not to vote our full allocation) if","page_number":240,"box":{"x":116,"y":862,"width":755,"height":12}},{"id":"fabac5ec-1c3d-4db1-ad59-d527ec0dd586","block_type":"box","text":"the costs (including but not limited to opportunity costs associated with share-blocking constraints)","page_number":240,"box":{"x":116,"y":877,"width":734,"height":13}},{"id":"1fd9cc43-015d-464d-9231-7adb9b933104","block_type":"box","text":"BlackRock Investment Stewardship","page_number":240,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"1b5c78bf-9d27-41b0-9b01-ab2ab617ab89","block_type":"box","text":"Global Principles |","page_number":240,"box":{"x":726,"y":909,"width":132,"height":12}},{"id":"1a1ae24d-9a75-4b68-b429-801dc70ddbf4","block_type":"box","text":"14","page_number":240,"box":{"x":866,"y":909,"width":17,"height":9}},{"id":"238ae38f-9839-4d8e-8736-d0e3e14b3177","block_type":"box","text":"NM0926U-5926888-240/257","page_number":240,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"c76c55da-eceb-446b-953c-7be19f6e2173","block_type":"box","text":"associated with exercising a vote are expected to outweigh the benefit the client would derive by voting","page_number":241,"box":{"x":116,"y":87,"width":770,"height":12}},{"id":"52f73cea-8800-4b2b-bb59-5d5da55573b3","block_type":"box","text":"on the proposal.","page_number":241,"box":{"x":116,"y":103,"width":125,"height":11}},{"id":"72ff1a09-e468-48fc-9c66-4ffce7ee0a91","block_type":"box","text":"Conflicts management policies and procedures","page_number":241,"box":{"x":117,"y":134,"width":382,"height":12}},{"id":"f6517dd9-af6b-4e32-ae69-b2d84741d8e9","block_type":"box","text":"BIS is a dedicated function whose responsibilities are separate from BlackRock’s sales, business","page_number":241,"box":{"x":117,"y":165,"width":724,"height":11}},{"id":"3da7a6ea-56fe-4168-b166-0193c26b4fc9","block_type":"box","text":"partnership or enterprise-level vendor management activities.","page_number":241,"box":{"x":117,"y":180,"width":460,"height":12}},{"id":"bd365891-b213-403a-a5eb-959009afe94b","block_type":"box","text":"BlackRock maintains policies and procedures that are designed to prevent undue influence on BIS’","page_number":241,"box":{"x":117,"y":211,"width":739,"height":12}},{"id":"c20386ed-56dc-4dc2-af9f-fa7c4c080147","block_type":"box","text":"proxy voting activity. Such influence might stem from any relationship between the investee company","page_number":241,"box":{"x":117,"y":227,"width":755,"height":12}},{"id":"cee3f26e-500c-40a1-9130-0b0e69865adb","block_type":"box","text":"(or any shareholder proponent or dissident shareholder) and BlackRock, BlackRock’s affiliates, a Fund","page_number":241,"box":{"x":117,"y":242,"width":766,"height":12}},{"id":"82ca2682-ba53-4e43-858c-8741a40026ea","block_type":"box","text":"or a Fund’s affiliates, or BlackRock employees.","page_number":241,"box":{"x":116,"y":258,"width":354,"height":12}},{"id":"a4495b70-1c09-4b99-85f8-bca2fc9ba4fa","block_type":"box","text":"For information on how BIS manages conflicts of interest, please see our disclosure.","page_number":241,"box":{"x":117,"y":289,"width":630,"height":12}},{"id":"82984094-1af6-4f53-ba05-3f9d968d59aa","block_type":"box","text":"Securities lending","page_number":241,"box":{"x":117,"y":320,"width":148,"height":12}},{"id":"940b9844-056e-4bc9-a674-4cd54acee5ca","block_type":"box","text":"When authorized, BlackRock acts as a securities lending agent on behalf of its clients. Lending","page_number":241,"box":{"x":116,"y":351,"width":710,"height":12}},{"id":"d386384c-c6c5-4dfa-987a-bdafb9e54aa6","block_type":"box","text":"securities enables BlackRock to increase the returns in clients’ portfolios, and BlackRock’s lending","page_number":241,"box":{"x":116,"y":366,"width":735,"height":12}},{"id":"feee6ce6-037d-49c7-8d4d-4ca2ac705577","block_type":"box","text":"agreements allow it to recall securities out on loan at any time. BlackRock (or any other lender) does","page_number":241,"box":{"x":116,"y":382,"width":751,"height":12}},{"id":"3a16ed16-2dfa-4e90-ab47-ad2663c665b6","block_type":"box","text":"not retain voting rights for securities out on loan. Entitlements associated with the lent securities","page_number":241,"box":{"x":117,"y":397,"width":715,"height":12}},{"id":"fef29590-c9dc-4157-963b-6417237c8672","block_type":"box","text":"(dividends, coupons, etc.), while on loan are paid back to the lender of the security as stipulated in","page_number":241,"box":{"x":117,"y":413,"width":733,"height":12}},{"id":"db5da58b-a0ab-4c73-9a72-af6dd0f1db31","block_type":"box","text":"industry standard legal agreements.","page_number":241,"box":{"x":117,"y":428,"width":271,"height":12}},{"id":"77a5f832-78fc-4fec-b7c6-71431f79fb3b","block_type":"box","text":"With regard to the relationship between securities lending and proxy voting, BlackRock cannot vote","page_number":241,"box":{"x":116,"y":459,"width":741,"height":12}},{"id":"ac3527e5-6969-4087-8cd2-aab95474372f","block_type":"box","text":"shares on loan and may determine to recall them for voting, as guided by our fiduciary duty as an asset","page_number":241,"box":{"x":116,"y":475,"width":772,"height":12}},{"id":"4c010d0b-26d8-455e-bdc6-2705ef75284f","block_type":"box","text":"manager to our clients in helping them achieve their investment goals. While this has occurred in a","page_number":241,"box":{"x":117,"y":490,"width":736,"height":12}},{"id":"3e8c3cd2-b8db-4374-95c3-cd679d63135f","block_type":"box","text":"limited number of cases, the decision to recall securities on loan as part of BlackRock’s securities","page_number":241,"box":{"x":117,"y":506,"width":727,"height":12}},{"id":"fdfde844-05b2-4e54-8d4a-7ad2955893c3","block_type":"box","text":"lending program in order to vote is based on an evaluation of various factors that include, but are not","page_number":241,"box":{"x":117,"y":521,"width":751,"height":12}},{"id":"024946a9-8e05-4ee3-9d24-6babec3ccb1a","block_type":"box","text":"limited to, assessing potential securities lending revenue alongside the potential long-term financial","page_number":241,"box":{"x":117,"y":537,"width":739,"height":12}},{"id":"b6fdd08e-2b72-40ef-9ce1-1325097f048e","block_type":"box","text":"value to clients of voting those securities (based on the information available at the time of recall","page_number":241,"box":{"x":116,"y":552,"width":719,"height":12}},{"id":"d957e8ec-d04b-4c1c-bf96-868aba906509","block_type":"box","text":"consideration).","page_number":241,"box":{"x":116,"y":568,"width":109,"height":12}},{"id":"a4d62938-654b-4127-bef1-ab2c4923f8a3","block_type":"box","text":"17","page_number":241,"box":{"x":227,"y":568,"width":11,"height":6}},{"id":"5f5e0b0e-f1bf-490d-b739-9944866524d5","block_type":"box","text":"BIS works with colleagues in the Securities Lending and Risk and Quantitative","page_number":241,"box":{"x":238,"y":568,"width":591,"height":12}},{"id":"fd2100c8-ade2-430a-b034-2794d1f8ab91","block_type":"box","text":"Analysis teams to evaluate the costs and benefits to clients of recalling shares on loan.","page_number":241,"box":{"x":116,"y":583,"width":650,"height":12}},{"id":"d7f1ee9b-718d-4e84-8221-524c1a7eed08","block_type":"box","text":"In almost all instances, BlackRock anticipates that the potential long-term financial value to clients of","page_number":241,"box":{"x":117,"y":614,"width":749,"height":12}},{"id":"6a0bc5c2-bd3b-4376-888d-15e226a0fa9a","block_type":"box","text":"voting shares would be less than the potential revenue the loan may provide clients. However, in","page_number":241,"box":{"x":116,"y":630,"width":722,"height":12}},{"id":"1ac06f66-043a-453a-b558-2bbc8e8366ad","block_type":"box","text":"certain instances, BlackRock may determine, in our independent business judgment as a fiduciary, that","page_number":241,"box":{"x":116,"y":645,"width":771,"height":12}},{"id":"7d197bbb-3037-40ef-a084-347388a23122","block_type":"box","text":"the value of voting outweighs the securities lending revenue loss to clients and would therefore recall","page_number":241,"box":{"x":116,"y":661,"width":748,"height":12}},{"id":"4ab022b2-12b3-48b6-9294-ad46a564fc60","block_type":"box","text":"shares to be voted in those instances. It is important to note that the majority of lendable assets in the","page_number":241,"box":{"x":116,"y":676,"width":755,"height":12}},{"id":"6c3b86c0-9628-4e1e-9017-e6260ce7cd71","block_type":"box","text":"market at any given time are not out on loan.","page_number":241,"box":{"x":117,"y":692,"width":331,"height":12}},{"id":"5bdde99a-6f31-4a87-89dd-f4fb179163e1","block_type":"box","text":"Periodically, BlackRock reviews our process for determining whether to recall securities on loan in","page_number":241,"box":{"x":117,"y":723,"width":725,"height":12}},{"id":"62eeb894-43e4-4651-a4e8-2da1c23dfc0d","block_type":"box","text":"order to vote and may modify it as necessary.","page_number":241,"box":{"x":116,"y":738,"width":338,"height":12}},{"id":"85e9d168-10dd-48e5-aba3-be940cfac985","block_type":"box","text":"17","page_number":241,"box":{"x":144,"y":789,"width":8,"height":5}},{"id":"c748eb11-a5b4-47dd-83e0-0cd734d908ea","block_type":"box","text":"Recalling securities on loan can be impacted by the timing of record dates. 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As a","page_number":249,"box":{"x":116,"y":129,"width":740,"height":12}},{"id":"7aad7439-56ca-44a2-aaf7-103e346fe5fd","block_type":"box","text":"general point, the team looks to companies that are important to the transition to a low-carbon","page_number":249,"box":{"x":116,"y":145,"width":702,"height":12}},{"id":"0803ca5f-df0c-4197-b04d-6c9d7f86ac8a","block_type":"box","text":"economy to explain the strategy and governance frameworks that they have determined most","page_number":249,"box":{"x":116,"y":160,"width":700,"height":12}},{"id":"d41e30ea-9590-4a8d-bff7-f333adaddac2","block_type":"box","text":"appropriate, which may include:","page_number":249,"box":{"x":116,"y":176,"width":241,"height":12}},{"id":"054fdad5-6815-49e7-95ad-32506169dc03","block_type":"box","text":"(1) a low-carbon transition strategy to demonstrate their alignment with the ambition to limit","page_number":249,"box":{"x":150,"y":202,"width":688,"height":12}},{"id":"457de9a5-16da-4641-b73e-cc167ac4863b","block_type":"box","text":"average global temperature rise to 1.5°C above pre-industrial levels. This would typically","page_number":249,"box":{"x":184,"y":218,"width":661,"height":12}},{"id":"1852c323-b362-43fb-a0da-16a19d014095","block_type":"box","text":"include a long-term strategy to achieve net-zero GHG emissions by 2050, with appropriate","page_number":249,"box":{"x":184,"y":233,"width":676,"height":12}},{"id":"459c8edf-3d0a-4906-8107-ef030a7ea2ee","block_type":"box","text":"near- and medium-term milestones to assess their progress.","page_number":249,"box":{"x":184,"y":249,"width":453,"height":12}},{"id":"3e4f639d-9595-4288-9ad1-7a98b800f5cc","block_type":"box","text":"(2) low-carbon transition-related reporting. Standardized disclosure of sustainability-related data","page_number":249,"box":{"x":150,"y":270,"width":724,"height":12}},{"id":"553e1e65-a093-4a44-ae5e-1c372a21b7e8","block_type":"box","text":"supports investors in making informed decisions. The International Sustainability Standards","page_number":249,"box":{"x":184,"y":285,"width":683,"height":13}},{"id":"34c1dedf-c155-4d83-b041-de29005f5ebe","block_type":"box","text":"Board (ISSB) standards, IFRS S1 and S2, represent one such approach to standardization","page_number":249,"box":{"x":184,"y":301,"width":678,"height":12}},{"id":"1bb73367-1cc4-4908-967b-347157f2d8b0","block_type":"box","text":"that the dedicated team finds useful in its analysis.","page_number":249,"box":{"x":183,"y":316,"width":374,"height":13}},{"id":"091401cd-d659-44eb-9e94-c61b10e47443","block_type":"box","text":"14","page_number":249,"box":{"x":559,"y":317,"width":11,"height":6}},{"id":"da1666f0-749e-4e47-a4f8-fe2dbed20962","block_type":"box","text":",","page_number":249,"box":{"x":572,"y":325,"width":8,"height":3}},{"id":"d2b0d6b0-5e43-43c2-aa1a-ee25e23a1b16","block_type":"box","text":"15","page_number":249,"box":{"x":581,"y":317,"width":11,"height":6}},{"id":"c04f89c7-4987-4c24-a1ee-5b26277d925a","block_type":"box","text":"IFRS S1 addresses the general","page_number":249,"box":{"x":592,"y":316,"width":244,"height":13}},{"id":"4a5f1445-2dc1-4c3a-90fb-b6b321fad7f6","block_type":"box","text":"requirements of sustainability reporting and IFRS S2 sets out the disclosures that provide","page_number":249,"box":{"x":184,"y":332,"width":667,"height":12}},{"id":"a1470104-afd1-490a-ba62-08333f9d7a37","block_type":"box","text":"investors with decision-useful information about a company’s most significant climate- and","page_number":249,"box":{"x":184,"y":347,"width":674,"height":13}},{"id":"a313d697-bf39-40be-8211-b33ffb55742a","block_type":"box","text":"low-carbon transition-related risks and opportunities. This includes receiving independent,","page_number":249,"box":{"x":184,"y":363,"width":671,"height":12}},{"id":"94edf378-e45c-47aa-9fc4-5a67633ff547","block_type":"box","text":"third-party assurances, as audit and assurance standards are developed.","page_number":249,"box":{"x":183,"y":379,"width":549,"height":12}},{"id":"0ed25323-0ffb-4ee9-8000-13f672fc9393","block_type":"box","text":"(3) scope 1 and scope 2, and most significant scope 3 GHG emissions.","page_number":249,"box":{"x":150,"y":400,"width":536,"height":12}},{"id":"d636e5d8-5e32-4cf9-9f6d-5d07bcf702ba","block_type":"box","text":"16","page_number":249,"box":{"x":689,"y":400,"width":10,"height":6}},{"id":"a32416c0-b537-4c61-8f83-dc85e9e4d176","block_type":"box","text":",","page_number":249,"box":{"x":701,"y":408,"width":8,"height":3}},{"id":"572fc399-f0d3-4c1a-a300-01b55b47e18f","block_type":"box","text":"17","page_number":249,"box":{"x":710,"y":400,"width":11,"height":6}},{"id":"ea8bc8d5-bdd3-45fb-bc9a-2a93240c9e68","block_type":"box","text":"In addition, the","page_number":249,"box":{"x":721,"y":400,"width":120,"height":11}},{"id":"834c318a-e2a5-4725-a321-8fe235f0f9cb","block_type":"box","text":"dedicated team looks to companies to disclose their emissions reduction targets for scope 1","page_number":249,"box":{"x":184,"y":415,"width":687,"height":12}},{"id":"559df444-45ee-4b53-a73a-5ab65cb489a2","block_type":"box","text":"and 2 emissions, science-based where possible. The team welcomes disclosure of targets or","page_number":249,"box":{"x":184,"y":431,"width":695,"height":12}},{"id":"343e3195-c516-480b-821d-d8177e3b418c","block_type":"box","text":"indicative goals, where companies have set them, for scope 3 emissions reductions. Scope 3","page_number":249,"box":{"x":184,"y":446,"width":696,"height":12}},{"id":"95eaadfe-eeab-4c72-99e6-a83acd090d17","block_type":"box","text":"information, including how a company is working with its value chain to accelerate reductions","page_number":249,"box":{"x":184,"y":462,"width":694,"height":12}},{"id":"b5632b0c-6b31-4ddb-b91d-196e942f1aac","block_type":"box","text":"in GHG intensity, provides useful insight to investors focused on investing in the low-carbon","page_number":249,"box":{"x":184,"y":477,"width":684,"height":12}},{"id":"128c02a5-457d-4c58-b3f9-e7892be3db2f","block_type":"box","text":"transition and understanding the impact of their investments on their decarbonization goals.","page_number":249,"box":{"x":183,"y":493,"width":678,"height":12}},{"id":"4294b9fe-7691-46f5-86ad-9e70e9f62a40","block_type":"box","text":"18","page_number":249,"box":{"x":864,"y":493,"width":10,"height":6}},{"id":"0eb8af2e-c029-42f9-962c-d402002848ff","block_type":"box","text":"13","page_number":249,"box":{"x":144,"y":518,"width":8,"height":5}},{"id":"ae8ad815-0d04-4fce-b21f-0b06f7890c85","block_type":"box","text":"Given data and measurement limitations, companies may need to provide estimated GHG emissions where reporting","page_number":249,"box":{"x":170,"y":518,"width":695,"height":9}},{"id":"7c190474-0a36-415b-a0a0-9a1bb26aa28f","block_type":"box","text":"methodologies are nascent. In addition, certain disclosures related to a company’s plans for adapting their business","page_number":249,"box":{"x":170,"y":531,"width":686,"height":9}},{"id":"312b04a6-6074-4cdc-90bc-fbd55250d7e0","block_type":"box","text":"models through the low-carbon transition may require forward-looking statements.","page_number":249,"box":{"x":170,"y":544,"width":485,"height":9}},{"id":"e80241a7-c3b2-4c22-8a8a-d5cacd690645","block_type":"box","text":"14","page_number":249,"box":{"x":144,"y":557,"width":8,"height":4}},{"id":"e984cd29-6dda-4e57-9d87-3a299ed48623","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Reporting Standards (IFRS)","page_number":249,"box":{"x":170,"y":556,"width":666,"height":10}},{"id":"385f7c8e-78c7-4d10-95c5-d6bae3c22170","block_type":"box","text":"Foundation. The standards build on the Task Force on Climate-related Financial Disclosures (TCFD) framework and the","page_number":249,"box":{"x":171,"y":569,"width":712,"height":10}},{"id":"8591631c-0630-4429-9243-4ad813e67883","block_type":"box","text":"standards and metrics developed by the Sustainability Accounting Standards Board (SASB), which have both","page_number":249,"box":{"x":170,"y":582,"width":649,"height":10}},{"id":"a1a5bc67-c64f-4d65-970f-d43d45fa6245","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":249,"box":{"x":170,"y":595,"width":674,"height":10}},{"id":"e64d5a70-233a-410d-bbc4-0e41a5a05f09","block_type":"box","text":"“General Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related","page_number":249,"box":{"x":170,"y":608,"width":647,"height":10}},{"id":"f5711547-b7b3-4d3c-a561-e39543e8f6da","block_type":"box","text":"Disclosures.” Websites accessed in December 2025.","page_number":249,"box":{"x":171,"y":621,"width":312,"height":8}},{"id":"d785e10e-8f66-484e-89b4-04c42f26d028","block_type":"box","text":"15","page_number":249,"box":{"x":144,"y":634,"width":8,"height":5}},{"id":"d7e23de9-6262-4f57-b681-e55e305422bf","block_type":"box","text":"A number of jurisdictions are consulting on adopting the standards issued to date or have already committed to doing","page_number":249,"box":{"x":170,"y":634,"width":694,"height":10}},{"id":"34acd5c3-efdb-4b8a-b988-20abaa6a3b72","block_type":"box","text":"so. BIS does not mandate any specific disclosure framework companies should use, and recognize that some","page_number":249,"box":{"x":170,"y":647,"width":651,"height":10}},{"id":"96e7dcc9-bcd9-4aae-9105-2a67a6739b86","block_type":"box","text":"companies may report using different standards, some of which may be required by regulation. In such cases, we ask","page_number":249,"box":{"x":170,"y":660,"width":698,"height":9}},{"id":"4c4af247-088a-4f55-906b-a57af38af5d3","block_type":"box","text":"that companies highlight the metrics that are industry- or company-specific. We also recognize that companies may be","page_number":249,"box":{"x":170,"y":673,"width":703,"height":9}},{"id":"e69a9b58-167d-4c1e-9894-8036a01d87b5","block_type":"box","text":"phasing in reporting over several years. We do not prescribe timelines regarding when companies should make","page_number":249,"box":{"x":170,"y":686,"width":661,"height":9}},{"id":"e8b38ccf-1cac-4046-a9b9-38c54f4e1cfa","block_type":"box","text":"sustainability-related disclosures but appreciate it when companies produce them sufficiently in advance of their","page_number":249,"box":{"x":170,"y":699,"width":664,"height":9}},{"id":"a4d618cf-a5bb-4fb7-b307-9dea62c63cbf","block_type":"box","text":"shareholder meeting, to the best of their abilities, to provide investors with time to assess the data and make informed","page_number":249,"box":{"x":170,"y":711,"width":698,"height":10}},{"id":"34871ac6-ad02-437e-86be-ea78aece963a","block_type":"box","text":"voting decisions.","page_number":249,"box":{"x":170,"y":725,"width":98,"height":9}},{"id":"1ad3550f-e36c-4e85-8968-a1ea4a1ceb8b","block_type":"box","text":"16","page_number":249,"box":{"x":144,"y":737,"width":8,"height":5}},{"id":"3a1d8338-6452-4ec0-8dee-86ab8e307313","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":249,"box":{"x":171,"y":737,"width":685,"height":10}},{"id":"add31e7c-9045-4063-8930-77621fb2fbe4","block_type":"box","text":"paper: FTSE Russel, “Scope for improvement: Solving the Scope 3 conundrum,” January 2024, accessed in December","page_number":249,"box":{"x":170,"y":750,"width":708,"height":10}},{"id":"7eb3ffee-1333-4432-a2c2-152675f56efe","block_type":"box","text":"2025.","page_number":249,"box":{"x":170,"y":763,"width":32,"height":8}},{"id":"3cf511d0-cd70-4801-b6ea-5d3574cde5f1","block_type":"box","text":"17","page_number":249,"box":{"x":144,"y":776,"width":8,"height":5}},{"id":"24515f0e-7acf-498d-aaff-23b66364cd08","block_type":"box","text":"Under this policy, the dedicated team looks for GHG emissions disclosures to be aligned with the Greenhouse Gas","page_number":249,"box":{"x":171,"y":776,"width":680,"height":10}},{"id":"4a1c82d3-dbc8-47f8-a6ad-c2c3a3f0b9b8","block_type":"box","text":"Protocol (GHG Protocol). The Protocol Standards and Guidance are currently being updated to ensure they continue to","page_number":249,"box":{"x":171,"y":789,"width":706,"height":10}},{"id":"71d61a6f-b270-4539-8d8e-ad315a9f4e49","block_type":"box","text":"provide “a rigorous and credible accounting foundation for businesses to measure, plan and track progress toward","page_number":249,"box":{"x":170,"y":802,"width":677,"height":10}},{"id":"3e0beaef-e790-4dcf-b020-ffd68955a0e9","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":249,"box":{"x":170,"y":815,"width":650,"height":10}},{"id":"e9de1f7c-afa7-4cd8-8558-1c3ce1773bcb","block_type":"box","text":"18","page_number":249,"box":{"x":144,"y":828,"width":8,"height":5}},{"id":"61dd7c3b-9799-41ba-9c6a-e390dd33b400","block_type":"box","text":"The dedicated team does not believe the purpose of scope 3 disclosure requirements should be to push publicly traded","page_number":249,"box":{"x":170,"y":828,"width":707,"height":9}},{"id":"2c4e07b0-6f59-46da-8bc2-8667fe0b4645","block_type":"box","text":"companies into the role of enforcing emission reduction targets outside of their control. Given methodological","page_number":249,"box":{"x":170,"y":841,"width":645,"height":9}},{"id":"cc970678-3e26-4341-bdb1-3c6a5ab9ba37","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":249,"box":{"x":170,"y":854,"width":686,"height":9}},{"id":"bf3c73b7-ad1c-4d48-ae36-fef8aedd0d77","block_type":"box","text":"useful when companies focus their disclosures on those of the fifteen scope 3 GHG Protocol categories that are","page_number":249,"box":{"x":170,"y":867,"width":663,"height":9}},{"id":"6b7e97c9-0a6b-43c6-b903-0ee3e83f2283","block_type":"box","text":"material to their business models.","page_number":249,"box":{"x":170,"y":880,"width":199,"height":7}},{"id":"c21ef3d3-efed-4eb6-af81-347431acf01d","block_type":"box","text":"BlackRock Investment Stewardship","page_number":249,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"505f702c-ede0-4ac5-814f-65d94b3faa60","block_type":"box","text":"Climate and Decarbonization St","page_number":249,"box":{"x":504,"y":909,"width":213,"height":9}},{"id":"696622ff-249d-4d7d-abae-7a68078a37b7","block_type":"box","text":"ewardship Guidelines |","page_number":249,"box":{"x":717,"y":909,"width":152,"height":12}},{"id":"4522e365-f060-4ff4-9362-d2c36ae793ce","block_type":"box","text":"6","page_number":249,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"7d5cf45b-93ed-452e-9c8f-0bb3f2d17dfc","block_type":"box","text":"NM0926U-5926888-249/257","page_number":249,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"eeacd339-9dc6-414f-9518-dac627cb8d99","block_type":"box","text":"However, the team recognizes that companies have varying ability to influence the emissions","page_number":250,"box":{"x":184,"y":87,"width":696,"height":12}},{"id":"fec9dfec-e6ff-4433-83b8-91f8082ac2fe","block_type":"box","text":"across the different parts of their value chain and, therefore, it is helpful when disclosures","page_number":250,"box":{"x":184,"y":102,"width":667,"height":12}},{"id":"fc3ee84c-7bd7-4f2b-af1a-436aa32a9cd0","block_type":"box","text":"explain the implications for the achievement of their decarbonization targets. For some","page_number":250,"box":{"x":184,"y":118,"width":647,"height":12}},{"id":"c6d3366c-b400-4c2b-a680-9cf14d9eb97b","block_type":"box","text":"companies that play an important role in the low-carbon transition, scope 3 may represent","page_number":250,"box":{"x":184,"y":134,"width":671,"height":12}},{"id":"cf7a07b5-6ada-46aa-bd99-9c87bbbb6bd1","block_type":"box","text":"their only significant source of GHG emissions in the value chain. 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This may include plans and targets to grow businesses that","page_number":250,"box":{"x":183,"y":196,"width":636,"height":12}},{"id":"eb9a2abf-11b1-46c0-944f-32117d110523","block_type":"box","text":"contribute to real world decarbonization, forward-looking capital or procurement allocation","page_number":250,"box":{"x":184,"y":211,"width":670,"height":12}},{"id":"4ccb7113-b81b-48dc-bcce-6f28e628c5ab","block_type":"box","text":"plans to net-zero aligned activities or suppliers, and strategies to mitigate material transition","page_number":250,"box":{"x":184,"y":227,"width":684,"height":12}},{"id":"db449c51-b50d-43fc-90c7-c49cd5be900d","block_type":"box","text":"risks.","page_number":250,"box":{"x":184,"y":242,"width":43,"height":10}},{"id":"07ddc331-63e2-4cbe-b011-cef39b1c5776","block_type":"box","text":"(4) where relevant, disclosures that describe the company’s exposure to climate-related physical","page_number":250,"box":{"x":150,"y":265,"width":729,"height":12}},{"id":"dc7242ab-423d-43d6-b863-02a082af1f36","block_type":"box","text":"risks – such as acute risks from extreme weather events or chronic risks from long-term shifts","page_number":250,"box":{"x":184,"y":280,"width":699,"height":13}},{"id":"faeb77df-3b1d-4e12-a807-0b3e7f217285","block_type":"box","text":"in climate patterns – and how these risks could reasonably be expected to affect the","page_number":250,"box":{"x":184,"y":296,"width":629,"height":12}},{"id":"a173adb0-70d8-4fdd-9d09-4d336db2a5a7","block_type":"box","text":"company’s operations, assets, or supply chains.","page_number":250,"box":{"x":184,"y":312,"width":361,"height":12}},{"id":"229d01d9-dba8-4802-a6dd-754ffbba4e94","block_type":"box","text":"Transition plans","page_number":250,"box":{"x":150,"y":342,"width":134,"height":12}},{"id":"e29ff819-f715-4b30-8936-fe457c4d790c","block_type":"box","text":"Some companies have published transition plans outlining how they intend to implement their","page_number":250,"box":{"x":150,"y":372,"width":698,"height":12}},{"id":"1931a4a4-105f-410f-9832-559824b78596","block_type":"box","text":"low-carbon transition strategies. 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In assessing the role and effectiveness of the board in this","page_number":250,"box":{"x":116,"y":633,"width":766,"height":12}},{"id":"874d20e9-d26d-47fc-8b08-d4e9a5930192","block_type":"box","text":"regard, the dedicated team seeks to understand whether:","page_number":250,"box":{"x":117,"y":649,"width":430,"height":12}},{"id":"948bf434-e5cf-4484-bad4-805116a20769","block_type":"box","text":"• The board has clear oversight responsibilities for climate and low-carbon transition-related","page_number":250,"box":{"x":150,"y":679,"width":702,"height":12}},{"id":"5488434a-09a6-417b-9676-93a8d61ff1fb","block_type":"box","text":"risks and opportunities in the company’s business model. 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Given forthcoming regulatory requirements in certain jurisdictions,","page_number":251,"box":{"x":184,"y":299,"width":684,"height":12}},{"id":"f4aff595-3958-4dd2-a3e4-c8d56784e364","block_type":"box","text":"some companies are voluntarily disclosing scope 3 emissions reductions targets and plans,","page_number":251,"box":{"x":184,"y":315,"width":683,"height":12}},{"id":"440cf185-079a-461f-b0d2-8de466fa891e","block_type":"box","text":"setting out how they are working on decarbonization with the different constituents in their","page_number":251,"box":{"x":184,"y":330,"width":670,"height":12}},{"id":"eab870d2-4a06-4a8c-a001-d2176193edc0","block_type":"box","text":"value chain.","page_number":251,"box":{"x":183,"y":346,"width":94,"height":9}},{"id":"8b5af382-89f8-48ce-9fa1-854610a490fb","block_type":"box","text":"21","page_number":251,"box":{"x":278,"y":346,"width":10,"height":6}},{"id":"20738a97-c5f5-44bb-8504-fcda0d81837f","block_type":"box","text":"• The company’s governance and oversight processes for managing material risks associated","page_number":251,"box":{"x":150,"y":368,"width":723,"height":12}},{"id":"338e94a7-96e9-4a2d-9e47-1fe2da901ab2","block_type":"box","text":"with corporate political activities including applicable policies and procedures where","page_number":251,"box":{"x":183,"y":383,"width":624,"height":12}},{"id":"6adc8b74-c661-49b6-b58a-45c0bba665c2","block_type":"box","text":"relevant.","page_number":251,"box":{"x":184,"y":399,"width":62,"height":9}},{"id":"7fbb5966-bbad-4871-a810-27565d654034","block_type":"box","text":"22","page_number":251,"box":{"x":248,"y":399,"width":11,"height":6}},{"id":"e80fc6e2-e41b-4915-a1ee-8b67e725e554","block_type":"box","text":"The dedicated team looks for public policy engagement to be consistent with a","page_number":251,"box":{"x":260,"y":399,"width":592,"height":12}},{"id":"35007811-9c54-4f0d-aaa0-4e4b1c22ac97","block_type":"box","text":"company’s stated strategic policy objectives, including those related to the low-carbon","page_number":251,"box":{"x":184,"y":414,"width":642,"height":12}},{"id":"51551b64-60a9-43f5-a331-48327429018e","block_type":"box","text":"transition.","page_number":251,"box":{"x":183,"y":430,"width":78,"height":9}},{"id":"4c893bb0-c336-4893-983e-aae157a40f43","block_type":"box","text":"Voting against directors over concerns about climate risk","page_number":251,"box":{"x":118,"y":458,"width":424,"height":12}},{"id":"efcd24c0-c09d-40a5-9f88-a6700af8fcbd","block_type":"box","text":"In implementing these Guidelines, the dedicated team generally supports non-executive directors","page_number":251,"box":{"x":117,"y":487,"width":726,"height":12}},{"id":"363900a8-2c29-48d1-8992-481bf6c31392","block_type":"box","text":"standing for election where, in its assessment based on company disclosures and engagement, a","page_number":251,"box":{"x":116,"y":502,"width":729,"height":13}},{"id":"f0fa2800-2e45-48c4-a1db-97aecdcdace8","block_type":"box","text":"company is executing on its commitment to align with the transition to a low-carbon economy, as","page_number":251,"box":{"x":116,"y":518,"width":722,"height":12}},{"id":"e77644f9-1135-47e9-b583-2fcff2bf9a2c","block_type":"box","text":"defined above. Where the dedicated team determines this is not the case, it may vote against the","page_number":251,"box":{"x":116,"y":533,"width":727,"height":13}},{"id":"4123496b-1123-47b2-953c-5d947e35d599","block_type":"box","text":"election of one or more directors who the team identifies as having the most responsibility for the issue.","page_number":251,"box":{"x":116,"y":549,"width":772,"height":12}},{"id":"6d87b0c3-5828-472b-acdd-75d6ccc384cc","block_type":"box","text":"The directors most likely to be in focus are the chair of the board committee with low-carbon transition,","page_number":251,"box":{"x":116,"y":564,"width":765,"height":13}},{"id":"d4b34042-4fac-4dcd-af21-7e6b0908e2c6","block_type":"box","text":"climate or sustainability risk oversight responsibilities, other members of the relevant committee, the","page_number":251,"box":{"x":116,"y":580,"width":746,"height":12}},{"id":"0e1948cd-de27-4d71-aad1-b10b16e5bdbf","block_type":"box","text":"lead independent director or the non-executive chair of the board. In certain markets, the team may","page_number":251,"box":{"x":117,"y":595,"width":741,"height":13}},{"id":"dd74db89-0bbc-48e5-bf43-ae85e5bb3c29","block_type":"box","text":"withhold support for the discharge of the supervisory board or equivalent and/or board reports.","page_number":251,"box":{"x":116,"y":611,"width":699,"height":12}},{"id":"059129b4-6a87-4b07-9558-0af117658ea1","block_type":"box","text":"23","page_number":251,"box":{"x":817,"y":611,"width":11,"height":6}},{"id":"36c6fe7f-504b-44f1-8364-b5eb372bf94e","block_type":"box","text":"Where the dedicated team has not supported director elections over climate concerns in a prior year,","page_number":251,"box":{"x":116,"y":640,"width":754,"height":12}},{"id":"b7da66c6-8760-499b-b733-a95a07b619e7","block_type":"box","text":"and the company has not subsequently made progress towards aligning with the transition to a","page_number":251,"box":{"x":116,"y":655,"width":709,"height":12}},{"id":"56562ac1-f474-4f52-bcc1-d47d32266454","block_type":"box","text":"low-carbon economy, the team may escalate by not supporting the re-election of additional responsible","page_number":251,"box":{"x":117,"y":671,"width":764,"height":12}},{"id":"bf7fc32b-1927-4007-acb2-beaa9266d89f","block_type":"box","text":"directors.","page_number":251,"box":{"x":116,"y":686,"width":67,"height":10}},{"id":"c222c2d9-e03a-4620-a156-e0d10beb3146","block_type":"box","text":"24","page_number":251,"box":{"x":185,"y":686,"width":12,"height":6}},{"id":"b2ddd85b-b1a0-4f54-ab78-d4b8d3ed1817","block_type":"box","text":"21","page_number":251,"box":{"x":143,"y":711,"width":8,"height":5}},{"id":"6ff6484a-1197-465b-95ac-61963fe14697","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":251,"box":{"x":171,"y":711,"width":685,"height":10}},{"id":"d03380ed-7353-4644-99d0-c1da75a02d73","block_type":"box","text":"paper “Scope for improvement: Solving the Scope 3 conundrum.” Their research indicates that there are 2-3 material","page_number":251,"box":{"x":170,"y":724,"width":692,"height":10}},{"id":"998ffcab-70ea-4f91-9d32-625454a9d025","block_type":"box","text":"scope 3 GHG emissions categories by sector. The research uses a definition of materiality from the GHG Protocol,","page_number":251,"box":{"x":170,"y":737,"width":679,"height":10}},{"id":"c9b62eae-fddc-4e82-b00b-428fee3e0afa","block_type":"box","text":"which “encourages companies to maintain a representative inventory of the “most significant GHG emissions, [that]","page_number":251,"box":{"x":170,"y":750,"width":682,"height":10}},{"id":"d7a7e76f-22bb-4617-93fa-56e5feacb727","block_type":"box","text":"offer the most significant GHG reduction opportunities and are most relevant to the company’s business goals.” Website","page_number":251,"box":{"x":170,"y":763,"width":712,"height":10}},{"id":"5d3cb089-6695-498d-8f15-a38f241ed7f4","block_type":"box","text":"accessed in December 2025.","page_number":251,"box":{"x":170,"y":776,"width":173,"height":7}},{"id":"1d7366f0-3620-4e03-9bfd-e9f3eea1f7bb","block_type":"box","text":"22","page_number":251,"box":{"x":143,"y":789,"width":9,"height":5}},{"id":"2ae1a091-3311-4bbf-b598-8e495f364197","block_type":"box","text":"Corporate political activities may include lobbying as defined by local regulations, policy engagement (including trade","page_number":251,"box":{"x":170,"y":789,"width":694,"height":9}},{"id":"5cad192e-0935-41b3-9034-edddfc194ddb","block_type":"box","text":"association memberships), and corporate political contributions.","page_number":251,"box":{"x":170,"y":802,"width":378,"height":9}},{"id":"9aca7388-c921-4f48-8f87-6e72a71770b2","block_type":"box","text":"23","page_number":251,"box":{"x":143,"y":815,"width":9,"height":5}},{"id":"2ea19b30-84ab-47e9-b69a-adc8406ceea3","block_type":"box","text":"Board report votes are generally advisory and relate to reports issued by the board of directors that may contain","page_number":251,"box":{"x":171,"y":815,"width":661,"height":9}},{"id":"cf898f54-5aa8-4344-872e-482d916cad2c","block_type":"box","text":"information on a company’s sustainability efforts, operational resilience, or financial condition, among others.","page_number":251,"box":{"x":170,"y":828,"width":643,"height":9}},{"id":"2991b36e-4d7d-428d-bcab-2680d93a3ca5","block_type":"box","text":"24","page_number":251,"box":{"x":143,"y":841,"width":9,"height":4}},{"id":"f65a18af-22e5-4c8c-8c84-c7249c5c3acf","block_type":"box","text":"While the dedicated team may escalate voting by not supporting additional management proposals, principally director","page_number":251,"box":{"x":170,"y":841,"width":703,"height":9}},{"id":"10adf778-81c9-4bf2-8959-f05f3a505fbe","block_type":"box","text":"elections, the team does not consider filing shareholder proposals, preannouncing voting intentions or using the media","page_number":251,"box":{"x":170,"y":853,"width":702,"height":10}},{"id":"eff0ed95-06e5-4a7f-ba27-8765a8960779","block_type":"box","text":"to amplify concerns as appropriate courses of action. The dedicated team will continue to take a constructive, long-term","page_number":251,"box":{"x":170,"y":866,"width":708,"height":10}},{"id":"6fbb7953-b466-4d71-be46-b3c0af61f3e7","block_type":"box","text":"focused approach, to engagement and voting on behalf of clients under these Guidelines.","page_number":251,"box":{"x":170,"y":879,"width":530,"height":10}},{"id":"cedaa0c8-34a7-44ae-9fb5-80a911b166e9","block_type":"box","text":"BlackRock Investment Stewardship","page_number":251,"box":{"x":117,"y":909,"width":282,"height":12}},{"id":"5fa7bb71-f9f3-48a9-8d46-8cd27a69ea01","block_type":"box","text":"Climate and Decarbonization St","page_number":251,"box":{"x":504,"y":909,"width":213,"height":9}},{"id":"0924608d-8233-490e-a769-6284ab62fa78","block_type":"box","text":"ewardship Guidelines |","page_number":251,"box":{"x":717,"y":909,"width":152,"height":12}},{"id":"527cf0f9-9012-47c4-a25a-ee7150ef2f75","block_type":"box","text":"8","page_number":251,"box":{"x":875,"y":909,"width":8,"height":9}},{"id":"f094c28f-7ff8-40ad-b92b-10c774a1605e","block_type":"box","text":"NM0926U-5926888-251/257","page_number":251,"box":{"x":757,"y":969,"width":158,"height":7}},{"id":"4732302b-0508-4dc0-aff5-783fae30ba42","block_type":"box","text":"Management proposals to approve a climate strategy or progress report","page_number":252,"box":{"x":116,"y":87,"width":582,"height":12}},{"id":"4c41844a-e767-4ecd-aefc-fb0eb68644dd","block_type":"box","text":"In certain markets, company management may submit proposals – commonly referred to as “Say on","page_number":252,"box":{"x":117,"y":120,"width":749,"height":12}},{"id":"3b6a4e6b-adb6-4911-9953-0de98891de56","block_type":"box","text":"Climate” – seeking shareholder approval of their climate action plans or progress reports. 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The team notes that assurance of","page_number":253,"box":{"x":116,"y":320,"width":744,"height":12}},{"id":"2e2224d8-870c-4fe9-9cc2-a414f01af418","block_type":"box","text":"corporate disclosures related to climate risk and the transition to a low-carbon economy is still nascent.","page_number":253,"box":{"x":116,"y":335,"width":769,"height":12}},{"id":"87d504f6-b5cf-4d16-80d3-ffe6bcaf7a6a","block_type":"box","text":"Mergers, acquisitions, asset sales, and other special situations","page_number":253,"box":{"x":116,"y":366,"width":509,"height":12}},{"id":"0b94b439-2a83-44e2-90f5-18c346179c4e","block_type":"box","text":"Special situations will be considered on their financial merits, but the dedicated team may engage on","page_number":253,"box":{"x":116,"y":397,"width":753,"height":12}},{"id":"9ee6dcf2-c2f5-42a9-a04d-9b5d0e2727a3","block_type":"box","text":"climate-related factors under these Guidelines where a transaction may significantly alter a company’s","page_number":253,"box":{"x":116,"y":413,"width":764,"height":12}},{"id":"4cdc3457-e0ab-4ded-b998-d9e271c09be8","block_type":"box","text":"climate strategy or a shareholder activist has proposed governance, strategic or operational changes","page_number":253,"box":{"x":116,"y":428,"width":754,"height":12}},{"id":"02455b5c-3cea-4b0e-a414-99dc2595846f","block_type":"box","text":"that may impact its climate strategy. 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We develop standards,","page_number":254,"box":{"x":170,"y":801,"width":702,"height":10}},{"id":"6d2b9139-4bd5-43a3-9e86-64f683234e3b","block_type":"box","text":"tools and guidance which allow companies to set greenhouse gas (GHG) emissions reductions targets in line with what","page_number":254,"box":{"x":170,"y":814,"width":707,"height":10}},{"id":"9f787ad6-8622-44ff-bde5-e4c32e9f230e","block_type":"box","text":"is needed to keep global heating below catastrophic levels and reach net-zero by 2050 at latest.” Source: Science","page_number":254,"box":{"x":170,"y":827,"width":675,"height":10}},{"id":"10ee3578-7a7f-4302-88b1-f425019898e4","block_type":"box","text":"Based Targets initiative, “About Us.” Websites accessed in December 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